UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 13, 2007
NEOSTEM, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-10909 22-2343568
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
420 Lexington Avenue, Suite 450
New York, New York 10170
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 584-4180
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
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Item 1.01. Entry into a Material Definitive Agreement.
On November 13, 2007, the Company entered into an acquisition agreement
with UTEK Corporation ("UTEK") and Stem Cell Technologies, Inc., a wholly-owned
subsidiary of UTEK ("SCTI"), pursuant to which the Company acquired all the
issued and outstanding common stock of SCTI in a stock-for-stock exchange.
Pursuant to a license agreement (the "License Agreement") between SCTI and the
University of Louisville Research Foundation ("ULRF"), SCTI owns an exclusive,
worldwide license to a technology developed by researchers at the University of
Louisville to identify and isolate rare stem cells from adult human bone marrow,
called VSELs (very small embryonic like) stem cells. Concurrent with the SCTI
acquisition, NeoStem entered into a sponsored research agreement (the "Sponsored
Research Agreement" or "SRA") with ULRF under which NeoStem will support further
research in the laboratory of Mariusz Ratajczak, M.D., Ph.D., a co-inventor of
the VSEL technology and head of the Stem Cell Biology Program at the James
Graham Brown Cancer Center at the University of Louisville. SCTI was funded by
UTEK in amounts sufficient to pay certain near-term costs under the License
Agreement and the SRA. In consideration for the acquisition, the Company issued
to UTEK 400,000 unregistered shares of its common stock, par value $0.001 per
share for all the issued and outstanding common stock of SCTI. The value of the
transaction is estimated to be $940,000.
VSELs have many characteristics typically found in embryonic stem cells,
including the ability to differentiate into specialized cells found in different
types of tissue that would be able to interact with the specific organ in order
to repair degenerated, damaged or diseased tissue (the three "Ds" of aging).
NeoStem has the ability to harvest and cryopreserve these VSELs from individual
patients, setting the stage for their use in personalized regenerative medicine.
If VSELs can be expanded from individual patients and their potential to develop
into different types of tissue cells maintained, it would represent a
significant step toward overcoming the two major limitations in the development
of stem cell therapies today, the ethical dilemma regarding use of embryonic
stem cells and the immunological problems associated with using cells from a
third party donor.
Under the License Agreement, SCTI agrees to engage in a diligent program to
develop the VSEL technology with the goal of public utilization resulting
therefrom. SCTI has the right to sublicense the VSEL technology in accordance
with the terms of the License Agreement. It further sets forth the parties
rights and obligations with regard to patent prosecution, including that SCTI
will take the lead in connection therewith. Certain license fees, royalties and
milestone payments are to be paid to ULRF from SCTI in connection with the
acquisition and development of the VSEL technology, and SCTI is responsible for
all payments for patent filings and related applications. The License Agreement
also contains certain provisions relating to "stacking," permitting SCTI to pay
royalties to ULRF at a reduced rate in the event it is required to also pay
royalties to third parties exceeding a specified threshold for other technology
in furtherance of the exercise of its patent rights or the manufacture of
products using the VSEL technology. ULRF retained the right under the License
Agreement to license and practice the VSEL Technology for noncommercial purposes
only, such as education, academic research, teaching and public service, and
also retained the right of publication subject to certain confidentiality
limitations. The License Agreement contains confidentiality and other standard
provisions, limits ULRF liability and provides for indemnification of ULRF and
to the extent allowed by law, indemnification of SCTI, and requires SCTI to
maintain certain minimum insurance levels.
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The License Agreement, which was entered into on November 12, 2007 as a
condition to the acquisition, has a term of twenty years, and may continue to be
in effect for a longer period of time if a valid claim under a patent or patent
pending application covered thereby still exists. SCTI can terminate the
agreement for any reason upon 60 days' prior written notice, and either party
can terminate the agreement upon 30 days' prior written notice upon certain
uncured material breaches of the agreement or immediately upon certain
bankruptcy related events. Additionally, portions of the license may be
converted to a non-exclusive license if SCTI does not diligently develop the
VSEL Technology or terminated entirely if SCTI chooses to not pay for the filing
and maintenance of any patents thereunder. Upon termination of the License
Agreement for any reason, certain obligations of the parties survive for periods
of time including confidentiality, limitation of liability and indemnification,
insurance obligations, accrued royalty reporting and accounting.
The License Agreement also contemplates that the Company and ULRF will
enter into an adult stem cell collection center agreement. Pursuant to this
agreement, stem cells would be provided to Dr. Ratajczak's laboratory in
connection with the performance of the research under the Sponsored Research
Agreement and certain of SCTI's diligence obligations with respect to developing
the VSEL Technology commence upon receipt of these cells.
Concurrently with the License Agreement, the Company entered into the
Sponsored Research Agreement with ULRF. Pursuant to the SRA, the Company will
support additional research relating to the VSEL technology to be carried out in
the laboratory of Mariusz Ratajczak, M.D., Ph.D. as principal investigator, a
co-inventor of the VSEL Technology and head of the Stem Cell Biology Program at
the James Graham Brown Cancer Center at the University of Louisville. In return,
the Company will receive the first option to negotiate a license to the research
results. The prior funding of SCTI by UTEK will pay for a portion of the
research costs.
Under the Sponsored Research Agreement, the Company agrees to support the
research as set forth in a research plan in an amount of $375,000. Such costs
are to be paid by the Company in accordance with a payment schedule which sets
forth the timing and condition of each such payment over the term of the SRA.
Under the SRA, ULRF retains the rights to intellectual property developed by its
employees in performance of the research relating to the VSEL Technology and the
Company and ULRF jointly own intellectual property developed jointly by
employees of ULRF and the Company in performance of the research. So long as the
Company continues to support and fund the filing of patent applications and
other intellectual property protection for the same, the Company has the first
option to negotiate for an exclusive, worldwide commercial license to ULRF's
interest in any such developed or jointly developed intellectual property. The
SRA also establishes rates for royalties and revenue sharing between the parties
in the event no license agreement is executed with regard to joint intellectual
property but one party chooses to develop or license it to a third party.
The term of the research is two and one-half years and shall commence after
all applicable institution (e.g., institutional review board ("IRB")) and
Federal approvals are obtained and upon the adult stem cell specimens required
for the research being provided to the laboratory.
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The SRA further sets out the parties respective rights and responsibilities
relating to patent prosecution, contains confidentiality provisions, limits ULRF
liability and provides for indemnification of ULRF. Either party may terminate
the SRA if Dr. Ratajczak is unable to perform the research and an acceptable
successor is not available, or if required approval of a review committee at the
University of Louisville or ULRF is not given or is withdrawn. The Company may
terminate the SRA upon 90 days' written notice to ULRF and either party may
terminate the SRA on 30 days' written notice in the event of uncured defaults or
breaches. Upon termination of the SRA for any reason, certain obligations of the
parties survive including confidentiality, disclosure, rights regarding
publications and ownership of intellectual property.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
Certain statements in this Form 8-K constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. For
this purpose, any statements contained herein that relate to future events or
conditions, including without limitation, statements regarding our financial
position, potential, business strategy, plans and objectives for future
operations, may be deemed to be forward-looking statements. All such statements,
which are all statements other than of historical fact, involve risks and
uncertainties. These statements are commonly identified by the use of such terms
and phrases as "intends," "expects," "anticipates," "estimates," "seeks" and
"believes." Additionally, statements concerning our ability to develop the adult
stem cell business, the future of regenerative medicine and the role of adult
stem cells in that future, the future use of adult stem cells as a treatment
option and the role of VSELs in that future, and the potential revenue growth of
such business are forward-looking statements. Our ability to enter the adult
stem cell arena and future operating results are dependent upon many factors,
including but not limited to: (i) our ability to obtain sufficient capital or a
strategic business arrangement to fund our expansion plans; (ii) our ability to
build the management and human resources and infrastructure necessary to support
the growth of our business; (iii) competitive factors and developments beyond
our control; (iv) scientific and medical developments beyond our control; (v)
our inability to obtain appropriate state licenses or any other adverse effect
or limitations caused by government regulation of the business; (vi) whether any
of the Company's current or future patent applications result in issued patents;
and (vii) other risk factors discussed in the Company's periodic filings with
the Securities and Exchange Commission which are available for review at
www.sec.gov under "Search for Company Filings." We cannot guarantee future
results or achievements, and readers are cautioned not to place undue reliance
on these forward-looking statements, which speak only as of the date hereof.
Except as required by law, the Company undertakes no obligation to update any
forward-looking statements, whether as a result of new information, future
events or otherwise.
Item 3.02 Unregistered Sales of Equity Securities
On November 13, 2007, the Company effected the issuance of 400,000 shares
of its unregistered common stock, par value $0.001 per share, to UTEK
Corporation in connection with the acquisition of SCTI described in Item 1.01
above.
The offer and sale by the Company of the securities described above were
made in reliance upon the exemption from registration provided by Section 4(2)
of the Securities Act of 1933, as amended (the "Securities Act"), for
transactions by an issuer not involving a public offering. The offer and sale of
such securities were made without general solicitation or advertising to an
"accredited investor," as such term is defined in Rule 501(a) of Regulation D
promulgated under the Securities Act.
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Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit 10.1 Agreement and Plan of Acquisition among NeoStem, Inc., Stem Cell
Technologies, Inc. and UTEK Corporation.
Exhibit 10.2 License Agreement between Stem Cell Technologies, Inc. and the
University of Louisville Research Foundation, Inc. (1)
Exhibit 10.3 Sponsored Research Agreement between NeoStem, Inc. and the
University of Louisville Research Foundation, Inc. (2)
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(1) Certain portions of Exhibit 10.2 were omitted based upon a request for
confidential treatment, and the omitted portions were filed separately with
the Securities and Exchange Commission on a confidential basis.
(2) Certain portions of Exhibit 10.3 were omitted based upon a request for
confidential treatment, and the omitted portions were filed separately with
the Securities and Exchange Commission on a confidential basis.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
NEOSTEM, INC.
By: /s/ Catherine M. Vaczy
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Catherine M. Vaczy
Vice President and General Counsel
Dated: November 19, 2007
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Exhibit 10.1
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ACQUISITION OF STEM CELL TECHNOLOGIES, INC.
by
NEOSTEM, INC.
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AGREEMENT AND PLAN OF ACQUISITION
This Agreement and Plan of Acquisition ("Agreement") is entered into by and
between Stem Cell Technologies, Inc., a Florida corporation, ("SCTI"), UTEK
CORPORATION, a Delaware corporation, ("UTEK"), and NeoStem, Inc., a Delaware
corporation, ("NBS").
WHEREAS, UTEK owns 100% of the issued and outstanding shares of common
stock of SCTI ("SCTI Shares"); and
WHEREAS, prior to the Closing Date, SCTI will acquire the license for the
fields of use as described in the License Agreement as described and which are
attached hereto as part of Exhibit A and made a part of this Agreement ("License
Agreement") and the rights to develop and market a proprietary technology for
the fields of uses specified in the License Agreement ("Technology").
WHEREAS, the parties desire to provide for the terms and conditions upon
which SCTI will be acquired by NBS in a stock-for-stock exchange ("Acquisition")
in accordance with the respective corporation laws of their state, upon
consummation of which all SCTI Shares will be owned by NBS, and all issued and
outstanding SCTI Shares will be exchanged for common stock of NBS with terms and
conditions as set forth in this Agreement; and
WHEREAS, for federal income tax purposes, it is intended that the
Acquisition qualifies within the meaning of Section 368 (a)(1)(B) of the
Internal Revenue Code of 1986, as amended.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt, adequacy and sufficiency of which are by
this Agreement acknowledged, the parties agree as follows:
ARTICLE 1
THE STOCK-FOR-STOCK ACQUISITION
1.01 The Exchange. At the closing of the transactions contemplated by this
Agreement ("Closing"), UTEK shall receive 400,000 common shares of the issued
and outstanding stock of NBS (the "NBS Shares") and in exchange, NBS shall
receive all of the SCTI Shares.
1.02 Closing Date. The Closing of the Acquisition shall take place at the
latest on November 15, 2007 or on such other date the parties hereto may
mutually agree; provided that the parties have complied with the obligations
required in Article 3 hereof and all conditions set forth in Article 4 have been
fulfilled or waived in writing. The Closing shall be held at the offices of NBS,
420 Lexington Avenue, Suite 450, New York, NY 10170 or such other place as the
parties may mutually agree. The date upon which such Closing shall occur shall
be referred to as the "Closing Date."
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ARTICLE 2
REPRESENTATIONS AND WARRANTIES
2.01 Representations and Warranties of UTEK and SCTI. UTEK and SCTI
represent and warrant to NBS that the facts set forth below are true and
correct:
(a) Organization. SCTI and UTEK are corporations duly organized,
validly existing and in good standing under the laws of their respective states
of incorporation, and they have the requisite power and authority to conduct
their business and consummate the transactions contemplated by this Agreement.
True, correct and complete copies of the articles of incorporation, bylaws and
all corporate minutes of SCTI have been provided to NBS and such documents are
presently in effect and have not been amended or modified. SCTI has no
subsidiaries and no interest in any other corporation, partnership, joint
venture or other entity.
(b) Authorization. The execution of this Agreement and the
consummation of the Acquisition and the transactions contemplated by this
Agreement have been duly authorized by the board of directors and shareholders
of SCTI and the board of directors of UTEK; no other corporate action by the
respective parties is necessary in order to execute, deliver, consummate and
perform their respective obligations hereunder; and SCTI and UTEK have all
requisite corporate and other authority to execute and deliver this Agreement
and consummate the transactions contemplated by this Agreement.
(c) Capitalization. The authorized capital of SCTI consists of
1,000,000 shares of common stock with a par value $0.01 per share. At the date
of this Agreement and at the Closing Date, all issued and outstanding shares of
SCTI have been duly and validly issued and are fully paid and non-assessable
shares and have not been issued in violation of any preemptive or other rights
of any other person or any applicable laws. SCTI is not authorized to issue any
preferred stock. All dividends on SCTI Shares which have been declared prior to
the date of this Agreement have been paid in full. There are no outstanding (i)
rights to purchase or subscribe for any shares, or other ownership interests of
SCTI, (ii) obligations of SCTI, whether absolute or contingent, to issue any
equity securities or other ownership interests, (iii) debt or equity securities
directly or indirectly convertible into any equity securities of SCTI or (iv)
any agreements, options, rights of first refusal or other similar rights with
respect to the shares of SCTI. None of the SCTI Shares are subject to any
change, claim, condition, interest, lien, pledge, option, security interest or
other encumbrance or restriction, including any restriction on use, voting,
transfer, receipt of income or exercise of any other attribute of ownership. At
the date of this Agreement, 1,000 SCTI Shares are issued and outstanding as
follows:
Shareholder Number of SCTI Shares
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Utek 1,000
Total 1,000
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(d) Binding Effect. The execution, delivery, performance and
consummation of this Agreement, the Acquisition and the transactions
contemplated by this Agreement will not violate any obligation to which SCTI or
UTEK is a party and will not create a default under any such obligation or under
any agreement to which SCTI or UTEK is a party. This Agreement constitutes a
legal, valid and binding obligation of SCTI, enforceable in accordance with its
terms, except as the enforcement may be limited by bankruptcy, insolvency,
moratorium, or similar laws affecting creditor's rights generally and by the
availability of injunctive relief, specific performance or other equitable
remedies.
(e) Litigation Relating to this Agreement. There are no suits,
actions or proceedings pending or to SCTI's and UTEK's knowledge threatened
which seek to enjoin the Acquisition or the transactions contemplated by this
Agreement or which, if adversely decided, would have a materially adverse effect
on its business, assets, prospects or the results of its operations of SCTI.
(f) No Conflicting Agreements. Neither the execution and delivery of
this Agreement nor the fulfillment of or compliance by SCTI or UTEK with the
terms or provisions of this Agreement nor all other documents or agreements
contemplated by this Agreement and the consummation of the transactions
contemplated by this Agreement will result in a breach of the terms, conditions
or provisions of, or constitute a default under, or result in a violation of,
SCTI or UTEK's articles of incorporation or bylaws, the Technology, the License
Agreement or any agreement, contract, instrument, order, judgment or decree to
which SCTI or UTEK is a party or by which SCTI or UTEK or any of their
respective assets is bound, or violate any provision of any applicable law, rule
or regulation or any order, decree, writ or injunction of any court or
government entity which materially affects their respective assets or
businesses.
(g) Consents. No consent from or approval of any court, governmental
entity or any other person is necessary in connection with execution and
delivery of this Agreement by SCTI and UTEK or performance of the obligations of
SCTI and UTEK hereunder or under any other agreement to which SCTI or UTEK is a
party; and the consummation of the transactions contemplated by this Agreement
will not require the approval of any entity or person in order to prevent the
termination of the Technology, the License Agreement or any other material
right, privilege, license or agreement relating to SCTI or its assets or
business.
(h) Title to Assets/SCTI Shares. SCTI has or has agreed to enter
into the agreements as listed on Exhibit A attached hereto. These agreements and
the assets shown on the balance sheet of attached Exhibit B are the sole assets
of SCTI. SCTI has or will by the Closing Date have good and marketable title to
its assets, free and clear of all liens, claims, charges, mortgages, options,
security agreements and other encumbrances of every kind or nature whatsoever.
As of the date hereof and the Closing Date, UTEK is the record and beneficial
owner of the SCTI Shares free and clear of all liens and restrictions of any
kind.
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(i) Intellectual Property
(1) The University of Louisville Research Foundation ("ULRF")
owns the Technology and has all right, power, authority and ownership and
entitlement to file, prosecute and maintain in effect the Patent application
with respect to the Inventions listed in Exhibit A hereto.
(2) The License Agreement between ULRF and SCTI covering the
Inventions is legal, valid, binding and will be enforceable in accordance with
its terms as contained in Exhibit A.
(3) Except as otherwise set forth in this Agreement, NBS
acknowledges and understands that SCTI and UTEK make no representations and
provide no assurances that the rights to the Technology and Intellectual
Property contained in the License Agreement do not, and will not in the future,
infringe or otherwise violate the rights of third parties.
(4) Except as otherwise expressly set forth in this Agreement,
SCTI and UTEK make no representations and extend no warranties of any kind,
either express or implied, including, but not limited to warranties of
merchantability, fitness for a particular purpose, non-infringement and validity
of the Intellectual Property.
(j) Liabilities of SCTI. SCTI has no assets (except as set forth in
Section 2.01(h)), no liabilities or obligations of any kind, character or
description except those listed on the attached exhibits.
(k) Financial Statements. The unaudited financial statements of
SCTI, including a balance sheet, attached as Exhibit B and made a part of this
Agreement, are, in all respects, complete and correct and present fairly SCTI's
financial position and the results of its operations on the dates and for the
periods shown in this Agreement; provided, however, that interim financial
statements are subject to customary year-end adjustments and accruals that will
not have a material adverse effect on the overall financial condition or results
of its operations. SCTI has not engaged in any business not reflected in its
financial statements. There have been no material adverse changes in the nature
of its business, prospects, the value of assets or the financial condition since
the date of its financial statements. There are no, and on the Closing Date
there will be no, outstanding obligations or liabilities of SCTI except as
specifically set forth in the financial statements and the other attached
schedules and exhibits. There is no information known to SCTI or UTEK that would
prevent the financial statements of SCTI from being audited in accordance with
generally accepted accounting principles.
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(l) Taxes. All returns, reports, statements and other similar
filings required to be filed by SCTI with respect to any federal, state, local
or foreign taxes, assessments, interests, penalties, deficiencies, fees and
other governmental charges or impositions have been timely filed with the
appropriate governmental agencies in all jurisdictions in which such tax returns
and other related filings are required to be filed; all such tax returns
properly reflect all liabilities of SCTI for taxes for the periods, property or
events covered by this Agreement; and all taxes, whether or not reflected on
those tax returns, and all taxes claimed to be due from SCTI by any taxing
authority, have been properly paid, except to the extent reflected on SCTI's
financial statements, where SCTI has contested in good faith by appropriate
proceedings and reserves have been established on its financial statements to
the full extent if the contest is adversely decided against it. SCTI has not
received any notice of assessment or proposed assessment in connection with any
tax returns, nor is SCTI a party to or to the best of its knowledge, expected to
become a party to any pending or threatened action or proceeding, assessment or
collection of taxes. SCTI has not extended or waived the application of any
statute of limitations of any jurisdiction regarding the assessment or
collection of any taxes. There are no tax liens (other than any lien which
arises by operation of law for current taxes not yet due and payable) on any of
its assets. There is no basis for any additional assessment of taxes, interest
or penalties. SCTI has made all deposits required by law to be made with respect
to employees' withholding and other employment taxes, including without
limitation the portion of such deposits relating to taxes imposed upon SCTI.
SCTI is not and has never been a party to any tax sharing agreements with any
other person or entity.
(m) Absence of Certain Changes or Events. From the date of the full
execution of the Term Sheet dated February 20, 2007 between UTEK and NBS until
the Closing Date, SCTI has not, and without the written consent of NBS, it will
not have:
(1) Sold, encumbered, assigned let lapsed or transferred any of
its assets, including without limitation the Intellectual Property, the License
Agreement or any other material asset;
(2) Amended or terminated the License Agreement or other material
agreement or done any act or omitted to do any act which would cause the breach
of the License Agreement or any other material agreement;
(3) Suffered any damage, destruction or loss whether or not in
control of SCTI;
(4) Made any commitments or agreements for capital expenditures
or otherwise;
(5) Entered into any transaction or made any commitment not
disclosed to NBS;
(6) Incurred any material obligation or liability for borrowed
money;
(7) Suffered any other event of any character, which is
reasonable to expect, would adversely affect the future condition (financial or
otherwise) assets or liabilities or business or prospects of SCTI; or
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(8) Taken any action, which could make any of the representations
or warranties made by SCTI or UTEK untrue as of the date of this Agreement or as
of the Closing Date.
(n) Material Agreements. Exhibit A attached contains a true and
complete list of all contemplated and executed agreements between SCTI and a
third party. A complete and accurate copy of all material agreements, contracts
and commitments of the following types, whether written or oral to which it is a
party or is bound (Contracts), has been provided to NBS and such agreements are
or will be at the Closing Date, in full force and effect without modifications
or amendment and constitute the legally valid and binding obligations of SCTI in
accordance with their respective terms and will continue to be valid and
enforceable following the Acquisition. SCTI is not in default of any of the
Contracts. In addition:
(1) There are no outstanding unpaid promissory notes, mortgages,
indentures, deed of trust, security agreements and other agreements and
instruments relating to the borrowing of money by or any extension of credit to
SCTI;
(2) There are no outstanding operating agreements, lease
agreements or similar agreements by which SCTI is bound;
(3) The complete final draft of the License Agreement has been
provided to NBS;
(4) Except as set forth in (3) above, there are no outstanding
licenses to or from others of any intellectual property and trade names;
(5) There are no outstanding agreements or commitments to sell,
lease or otherwise dispose of any of SCTI's property; and
(6) There are no breaches of any agreement to which SCTI is a
party.
(o) Compliance with Laws. SCTI is in compliance with all applicable
laws, rules, regulations and orders promulgated by any federal, state or local
government body or agency relating to its business and operations.
(p) Litigation. There is no suit, action or any arbitration,
administrative, legal or other proceeding of any kind or character, or any
governmental investigation pending or to the best knowledge of SCTI or UTEK,
threatened against SCTI, the Technology, or the License Agreement affecting its
assets or business (financial or otherwise) or prospects, and neither SCTI nor
UTEK is in violation of or in default with respect to any judgment, order,
decree or other finding of any court or government authority relating to the
assets, business or properties of SCTI or the transactions contemplated hereby.
There are no pending or threatened actions or proceedings before any court,
arbitrator or administrative agency, which would, if adversely determined,
individually or in the aggregate, materially and adversely affect the assets or
business of SCTI or the transactions contemplated.
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(q) Employees. SCTI has no and never had any employees. SCTI is not
a party to or bound by any employment agreement or any collective bargaining
agreement with respect to any employees. SCTI is not in violation of any law,
regulation relating to employment of employees.
(r) Adverse Effect. Neither SCTI nor UTEK has any knowledge of any
or threatened existing occurrence, action or development that could cause a
material adverse effect on SCTI or its business, assets or condition (financial
or otherwise) or prospects.
(s) Employee Benefit Plans. SCTI has never had any employee benefit
plans, and there are no commitments to create any, including without limitation
as such term is defined in the Employee Retirement Income Security Act of 1974,
as amended, in effect, and there are no outstanding or un-funded liabilities nor
will the execution of this Agreement and the actions contemplated in this
Agreement result in any obligation or liability to any present or former
employee.
(t) Books and Records. The books and records of SCTI are complete
and accurate in all material respects, fairly present its business and
operations, have been maintained in accordance with good business practices, and
applicable legal requirements, and accurately reflect in all material respects
its business, financial condition and liabilities.
(u) No Broker's Fees. Neither UTEK nor SCTI has incurred any
investment banking, advisory or other similar fees or obligations in connection
with this Agreement or the transactions contemplated by this Agreement.
(v) Full Disclosure. All representations or warranties of UTEK and
SCTI are true, correct and complete in all material respects on the date of this
Agreement and shall be true, correct and complete in all material respects as of
the Closing Date as if they were made on such date. No statement made by UTEK or
SCTI in this Agreement or in the exhibits to this Agreement or any document
delivered by them or on their behalf pursuant to this Agreement contains an
untrue statement of material fact or omits to state all material facts necessary
to make the statements in this Agreement not misleading in any material respect
in light of the circumstances in which they were made.
2.02 Representations and Warranties of NBS. NBS represents and warrants to
UTEK and SCTI that the facts set forth below are true and correct.
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(a) Organization. NBS is a corporation duly organized, validly
existing and in good standing under the laws of Delaware, is qualified to do
business as a foreign corporation in other jurisdictions in which the conduct of
its business or the ownership of its properties require such qualification, to
the extent that a failure to do so will have a Material Adverse Effect (as
defined below), and has all requisite power and authority to conduct its
business and operate properties. "Material Adverse Effect" means any event,
change or effect that, when taken individually or together with all other
adverse events, changes and effects, is likely to be materially adverse to the
condition (financial or otherwise), properties, assets, liabilities, business,
operations, results of operations or prospects of the business of NBS.
(b) Authorization. The execution of this Agreement and the
consummation of the Acquisition and the other transactions contemplated by this
Agreement have been duly authorized by the board of directors of NBS; no other
corporate action on their respective parts is necessary in order to execute,
deliver, consummate and perform their obligations hereunder; and they have all
requisite corporate and other authority to execute and deliver this Agreement
and consummate the transactions contemplated by this Agreement.
(c) Capitalization. The authorized capital of NBS consists of
500,000,000 (Five Hundred Million) shares of common stock with a par value
$0.001 per share (NBS Common Shares). All issued and outstanding shares of NBS
have been duly and validly issued and are fully paid and non-assessable shares
and have not been issued in violation of any preemptive or other rights of any
other person or any applicable laws.
(d) Binding Effect. The execution, delivery, performance and
consummation of the Acquisition and the transactions contemplated by this
Agreement will not violate any obligation to which NBS is a party and will not
create a default hereunder, and this Agreement constitutes a legal, valid and
binding obligation of NBS, enforceable in accordance with its terms, except as
the enforcement may be limited by bankruptcy, insolvency, moratorium, or similar
laws affecting creditor's rights generally and by the availability of injunctive
relief, specific performance or other equitable remedies.
(e) Litigation Relating to this Agreement. There are no suits,
actions or proceedings pending or to its knowledge threatened which seek to
enjoin the Acquisition or the transactions contemplated by this Agreement or
which, if adversely decided, would have a materially adverse effect on its
business, assets, prospects or the results of its operations of NBS.
(f) No Conflicting Agreements. Neither the execution and delivery of
this Agreement nor the fulfillment of or compliance by NBS with the terms or
provisions of this Agreement will result in a breach of the terms, conditions or
provisions of, or constitute default under, or result in a violation of, their
respective corporate charters or bylaws, or any agreement, contract, instrument,
order, judgment or decree to which it is a party or by which it or any of its
assets are bound, or violate any provision of any applicable law, rule or
regulation or any order, decree, writ or injunction of any court or governmental
entity which materially affects its assets or business.
8
(g) Consents. Assuming the correctness of UTEK and SCTI's
representations, no consent from or approval of any court, governmental entity
or any other person is necessary in connection with its execution and delivery
of this Agreement except as has already been obtained; and the consummation of
the transactions contemplated by this Agreement will not require the approval of
any entity or person in order to prevent the termination of any material right,
privilege, license or agreement relating to NBS or its assets or business.
(h) Financial Statements. The financial statements included in the
Form 8-K filed pursuant to the Securities Exchange Act of 1934, as amended on
September 11, 2007, are true and complete copies of the financial statements of
NBS. These financial statements (i) have been prepared from the books and
records of NBS in accordance with generally accepted accounting principles as
applicable in the United States, consistently applied with prior periods, and
(ii) are complete and correct and fairly reflect, in each case in all material
respects, the financial condition and results of operations of NBS as of the
dates and for the periods indicated thereon.
(i) Full Disclosure. All representations or warranties of NBS are
true, correct and complete in all material respects on the date of this
Agreement and shall be true, correct and complete in all material respects as of
the Closing Date as if they were made on such date. No statement made by them in
this Agreement or in the exhibits to this Agreement or any document delivered by
them or on their behalf pursuant to this Agreement contains an untrue statement
of material fact or omits to state all material facts necessary to make the
statements in this Agreement not misleading in any material respect in light of
the circumstances in which they were made.
(j) Compliance with Laws. NBS will comply with all applicable laws,
rules, regulations and orders promulgated by any federal, state or local
government body or agency relating to its business and operations, to the extent
that a failure to do so will have a Material Adverse Effect.
(k) Litigation. There is no suit, action or any arbitration,
administrative, legal or other proceeding of any kind or character, or any
governmental investigation pending or, to the best knowledge of NBS, threatened
against NBS materially affecting its assets or business (financial or
otherwise), and NBS is not in violation of or in default with respect to any
judgment, order, decree or other finding of any court or government authority.
There are no pending or threatened actions or proceedings before any court,
arbitrator or administrative agency, which would, if adversely determined,
individually or in the aggregate, materially and adversely affect its assets or
business.
(l) Investment Company Status. NBS is not an investment company,
either registered or unregistered.
9
2.03 Investment Representations of UTEK. UTEK represents and warrants to
NBS that:
(a) General. It has such knowledge and experience in financial and
business matters as to be capable of evaluating the risks and merits of an
investment in NBS Shares pursuant to the Acquisition. It is able to bear the
economic risk of the investment in NBS Shares, including the risk of a total
loss of the investment in NBS Shares. The acquisition of NBS Shares is for its
own account and is for investment and not with a view to the distribution of NBS
Shares. Except as permitted by law, it has a no present intention of selling,
transferring or otherwise disposing in any way of all or any portion of the
shares at the present time. All information that it has supplied to NBS is true
and correct. It has conducted all investigations and due diligence concerning
NBS to evaluate the risks inherent in accepting and holding the shares which it
deems appropriate, and it has found all such information obtained fully
acceptable. It has had an opportunity to ask questions of the officer and
directors of NBS concerning NBS Shares and the business and financial condition
of and prospects for NBS, and the officers and directors of NBS have adequately
answered all questions asked and made all relevant information available to
them. UTEK is an accredited investor, as the term is defined in Regulation D,
promulgated under the Securities Act of 1933, as amended, and the rules and
regulations thereunder.
(b) Stock Transfer Restrictions. UTEK acknowledges that the NBS
Shares will not be registered and UTEK will not be permitted to sell or
otherwise transfer the NBS Shares in any transaction in contravention of the
following legend, which will be imprinted in substantially the following form on
the stock certificate representing NBS Shares:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE ACT), OR UNDER THE SECURITIES LAWS
OF ANY STATE. THESE SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, ASSIGNED,
TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED PURSUANT TO THE
PROVISIONS OF THE ACT AND THE LAWS OF SUCH STATES UNDER WHOSE LAWS A TRANSFER OF
SECURITIES WOULD BE SUBJECT TO A REGISTRATION REQUIREMENT, UNLESS UTEK
CORPORATION HAS OBTAINED AN OPINION OF COUNSEL STATING THAT SUCH DISPOSITION IS
IN COMPLIANCE WITH AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION.
ARTICLE 3
TRANSACTIONS PRIOR TO CLOSING / COVENANTS
3.01. Corporate Approvals. Prior to the Closing Date, each of the parties
shall submit this Agreement to its board of directors and when necessary, its
respective shareholders and obtain approval of this Agreement. Copies of
corporate actions taken shall be provided to each party.
10
3.02 Access to Information. Each party agrees to permit, upon reasonable
notice, the attorneys, accountants, and other representatives of the other
party's reasonable access during normal business hours to its properties and its
books and records to make reasonable investigations with respect to its affairs,
and to make its officers and employees available to answer questions and provide
additional information as reasonably requested.
3.03 Expenses. Each party agrees to bear its own expenses in connection
with the negotiation and consummation of the Acquisition and the transactions
contemplated by this Agreement.
3.04 Covenants. Except as permitted in writing, each party agrees that it
will:
(a) Use its good faith efforts to obtain all requisite licenses,
permits, consents, approvals and authorizations necessary in order to consummate
the Acquisition; and
(b) Notify the other parties upon the occurrence of any event which
would have a materially adverse effect upon the Acquisition or the transactions
contemplated by this Agreement or upon the business, assets or results of
operations; and
(c) Not modify its corporate structure, except as necessary or
advisable in order to consummate the Acquisition and the transactions
contemplated by this Agreement.
ARTICLE 4
CONDITIONS PRECEDENT
The obligation of the parties to consummate the Acquisition and the
transactions contemplated by this Agreement are subject to the following
conditions that may be waived, to the extent permitted by law:
4.01. Each party must obtain the approval of its board of directors and
such approval shall not have been rescinded or restricted.
4.02. Each party shall obtain all requisite licenses, permits, consents,
authorizations and approvals required to complete the Acquisition and the
transactions contemplated by this Agreement.
4.03. There shall be no claim or litigation instituted or threatened in
writing by any person or government authority seeking to restrain or prohibit
any of the contemplated transactions contemplated by this Agreement or
challenges the right, title and interest of UTEK in the SCTI Shares or the right
of SCTI or UTEK to consummate the Acquisition contemplated hereunder.
11
4.04. The representations and warranties of the parties shall be true and
correct in all material respects at the date hereof and at the Closing Date.
4.05. The Technology and Intellectual Property has been prosecuted in good
faith with reasonable diligence.
4.06. NBS shall have received a certificate of the chief executive officer
of SCTI that the License Agreement: (i) is in full force and effect, (ii) has
not been amended in any way.
4.07. SCTI shall provide to NBS the written opinion of its legal counsel in
substantially the form of opinion attached hereto as Exhibit C.
4.08. All documents that are necessary to be filed prior to the closing of
the transactions contemplated hereby shall have been filed with the applicable
governmental and regulatory authorities, including, without limitation, the
United States Securities and Exchange Commission.
4.09. NBS shall have received, within five (5) business days of the Closing
Date, each of the following:
(a) the stock certificates representing the SCTI Shares, duly
endorsed (or accompanied by duly executed stock powers) by UTEK for
cancellation;
(b) all documentation relating to SCTI's business, all in a form and
substance satisfactory to NBS;
(c) such agreements, files and other data and documents pertaining
to SCTI's business as NBS may reasonably request;
(d) copies of the general ledgers and books of account of SCTI, and
all federal, state and local income, franchise, property and other tax returns
filed by SCTI since the inception of SCTI;
(e) certificates of the Secretary of State of the State of Florida
as to the legal existence and good standing, as applicable, (including tax) of
SCTI in Florida;
(f) the original corporate minute books of SCTI, including the
articles of incorporation and bylaws of SCTI, and all other documents filed in
this Agreement;
(g) all consents, assignments or related documents of conveyance to
give NBS the benefit of the transactions contemplated hereunder;
(h) such documents as may be needed to accomplish the Closing under
the corporate laws of the states of incorporation of NBS and SCTI, and
12
(i) such other documents, instruments or certificates as NBS, or
their counsel may reasonably request.
4.10. NBS shall have completed due diligence investigation of SCTI to NBS's
satisfaction in their sole discretion.
4.11. NBS shall receive the resignation effective the Closing Date of each
director and officer of SCTI.
ARTICLE 5
SURVIVAL OF REPRESENTATIONS AND WARRANTIES /
5.01. Survival of Representations and Warranties of UTEK and SCTI. The
representations and warranties made by UTEK and SCTI shall survive for a period
of one year after the Closing Date, and thereafter all such representation and
warranties shall be extinguished, except with respect to claims then pending for
which specific notice has been given during such one-year period.
5.02. Survival of Representations and Warranties of NBS. The
representations and warranties made by NBS shall survive for a period of one
year after the Closing Date, and thereafter all such representations and
warranties shall be extinguished, except with respect to claims then pending for
which specific notice has been given during such one-year period.
5.03. Limitations on Liability. NBS agrees that UTEK shall not be liable
under this agreement to NBS or their respective successor's, assigns or
affiliates except where damages result directly from the gross negligence or
willful misconduct of UTEK or its employees. In no event shall UTEK's liability
exceed the total amount of the fees paid to UTEK under this agreement, nor shall
UTEK be liable for incidental or consequential damages of any kind. NBS shall
indemnify UTEK, and hold UTEK harmless against any and all claims by third
parties for losses, damages or liabilities, including reasonable attorneys fees
and expenses ("Losses"), arising in any manner out of or in connection with the
rendering of services by UTEK under this Agreement, unless it is finally
judicially determined that such Losses resulted from the gross negligence or
willful misconduct of UTEK. The terms of this paragraph shall survive the
termination of this agreement and shall apply to any controlling person,
director, officer, employee or affiliate of UTEK.
5.04. Indemnification. NBS agrees to indemnify and hold harmless UTEK and
its subsidiaries and affiliates and each of its and their officers, directors,
principals, shareholders, agents, independent contactors and employees
(collectively "Indemnified Persons") from and against any and all claims,
liabilities, damages, obligations, costs and expenses (including reasonable
attorneys' fees and expenses and costs of investigation) arising out of or
relating to matters or arising from this Agreement, except to the extent that
any such claim, liability, obligation, damage, cost or expense shall have been
determined by final non-appealable order of a court of competent jurisdiction to
have resulted from the gross negligence or willful misconduct of the Indemnified
Person or Persons in respect of whom such liability is asserted.
13
5.05. Limitations on Liability. UTEK agrees that NBS shall not be liable
under this agreement to UTEK or their respective successor's, assigns or
affiliates except where damages result directly from the gross negligence or
willful misconduct of NBS or its employees. In no event shall NBS's liability
exceed the total amount of the fees paid to NBS under this agreement, nor shall
NBS be liable for incidental or consequential damages of any kind. UTEK shall
indemnify NBS, and hold NBS harmless against any and all claims by third parties
for losses, damages or liabilities, including reasonable attorneys fees and
expenses ("Losses"), arising in any manner out of or in connection with the
rendering of services by NBS under this Agreement, unless it is finally
judicially determined that such Losses resulted from the gross negligence or
willful misconduct of NBS. The terms of this paragraph shall survive the
termination of this agreement and shall apply to any controlling person,
director, officer, employee or affiliate of NBS.
5.06. Indemnification. UTEK agrees to indemnify and hold harmless NBS and
its subsidiaries and affiliates and each of its and their officers, directors,
principals, shareholders, agents, independent contactors and employees
(collectively "Indemnified Persons") from and against any and all claims,
liabilities, damages, obligations, costs and expenses (including reasonable
attorneys' fees and expenses and costs of investigation) arising out of or
relating to matters or arising from this Agreement, except to the extent that
any such claim, liability, obligation, damage, cost or expense shall have been
determined by final non-appealable order of a court of competent jurisdiction to
have resulted from the gross negligence or willful misconduct of the Indemnified
Person or Persons in respect of whom such liability is asserted.
(a) Limitation of Liability. UTEK agrees that no Indemnified Person
shall have any liability as a result of the execution and delivery of this
Agreement, or other matters relating to or arising from this Agreement, other
than liabilities that shall have been determined by final non-appealable order
of a court of competent jurisdiction to have resulted from the gross negligence
or willful misconduct of the Indemnified Person or Persons in respect of whom
such liability is asserted. Without limiting the generality of the foregoing, in
no event shall any Indemnified Person be liable for consequential, indirect or
punitive damages, damages for lost profits or opportunities or other like
damages or claims of any kind.
ARTICLE 6
REMEDIES
6.01 Specific Performance. Each party's obligations under this Agreement
are unique. If any party should default in its obligations under this agreement,
the parties each acknowledge that it would be extremely impracticable to measure
the resulting damages. Accordingly, the non-defaulting party, in addition to any
other available rights or remedies, may sue in equity for specific performance,
and the parties each expressly waive the defense that a remedy in damages will
be adequate.
14
6.02 Costs. If any legal action or any arbitration or other proceeding is
brought for the enforcement of this agreement or because of an alleged dispute,
breach, default, or misrepresentation in connection with any of the provisions
of this agreement, the successful or prevailing party or parties shall be
entitled to recover reasonable attorneys' fees and other costs incurred in that
action or proceeding, in addition to any other relief to which it or they may be
entitled.
ARTICLE 7
ARBITRATION
In the event a dispute arises with respect to the interpretation or effect
of this Agreement or concerning the rights or obligations of the parties to this
Agreement, the parties agree to negotiate in good faith with reasonable
diligence in an effort to resolve the dispute in a mutually acceptable manner.
Failing to reach a resolution of this Agreement, either party shall have the
right to submit the dispute to be settled by arbitration before one arbitrator
under the Commercial Rules of Arbitration of the American Arbitration
Association. The parties agree that, unless the parties mutually agree to the
contrary such arbitration shall be conducted in the State of New York. The cost
of arbitration shall be borne by the party against whom the award is rendered
or, if in the interest of fairness, as allocated in accordance with the judgment
of the arbitrators.
ARTICLE 8
MISCELLANEOUS
8.01. No party may assign this Agreement or any right or obligation of it
hereunder without the prior written consent of the other parties to this
Agreement. No permitted assignment shall relieve a party of its obligations
under this Agreement without the separate written consent of the other parties.
8.02. This Agreement shall be binding upon and inure to the benefit of the
parties and their respective permitted successors and assigns.
8.03. Each party agrees that it will comply with all applicable laws, rules
and regulations in the execution and performance of its obligations under this
Agreement.
8.04. This Agreement shall be governed by and construct in accordance with
the laws of the State of Delaware without regard to principles of conflicts of
law.
8.05. This document constitutes a complete and entire agreement among the
parties with reference to the subject matters set forth in this Agreement. No
statement or agreement, oral or written, made prior to or at the execution of
this Agreement and no prior course of dealing or practice by either party shall
vary or modify the terms set forth in this Agreement without the prior consent
of the other parties to this Agreement. This Agreement may be amended only by a
written document signed by the parties.
15
8.06. All notices, requests, demands, or other communications with respect
to this Agreement shall be in writing and shall be (a) sent by facsimile
transmission, (b) or with respect of notices from the United States sent by the
United States Postal Service, registered or certified mail, return receipt
requested, or (c) personally delivered by a nationally recognized express
overnight courier service, charges prepaid, to the following addresses (or such
other addresses as the parties may specify from time to time in accordance with
this Section):
(i) If to UTEK:
UTEK CORPORATION
Clifford M. Gross, Ph.D.
Chief Executive Officer
2109 East Palm Avenue
Tampa, Florida 33605
(ii) If to NBS or SCTI:
NEOSTEM, INC.
Catherine Vaczy
General Counsel
420 Lexington Ave, Suite 450
New York, New York 10170
8.07. The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other provision of this
Agreement.
8.08. This Agreement may be executed in multiple counterparts, each of
which shall constitute one and a single Agreement.
8.09. Any facsimile signature of any part to this Agreement or to any other
agreement or document executed in connection of this Agreement should constitute
a legal, valid and binding execution by such parties.
(SIGNATURES ON THE FOLLOWING PAGE)
16
NEOSTEM, INC. STEM CELL TECHNOLOGIES, INC.
By: /s/ Robin Smith By: /s/ Jennifer Willis
-------------- -------------------
Robin Smith, M.D. Jennifer Willis
Chief Executive Officer President
Address: Address:
420 Lexington Ave, Suite 450 2109 East Palm Avenue
New York, New York 10170 Tampa, Florida 33605
Date: November 12, 2007 Date: November 12, 2007
UTEK CORPORATION
By: /s/ Clifford M. Gross
---------------------
Clifford M. Gross, Ph.D.
Chief Executive Officer
Address:
2109 East Palm Avenue
Tampa, Florida 33605
Date: November 12, 2007
UTEK CORPORATION
By: /s/ Doug Schaedler
Doug Schaedler
Chief Compliance Officer
Address:
2109 East Palm Avenue
Tampa, Florida 33605
Date: November 12, 2007
17
Exhibit 10.2
* INDICATES A PORTION OF THIS EXHIBIT THAT WAS OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. THIS EXHIBIT INCLUDING SUCH OMITTED INFORMATION WAS
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION ON A CONFIDENTIAL
BASIS.
EXCLUSIVE LICENSE AGREEMENT
BETWEEN
UNIVERSITY OF LOUISVILLE RESEARCH FOUNDATION, INC.
AND
STEM CELL TECHNOLOGIES, INC.
This exclusive license agreement (the "Agreement") is entered into this
12 day of November 2007 (the "Effective Date") by and between the University of
Louisville Research Foundation, Inc. ("ULRF"), a Kentucky 501 (c) 3 non-profit
corporation having an office at Med Center Three, 201 E. Jefferson Street, Suite
215, Louisville, KY 40202 as the agent of the University of Louisville ( "UofL")
and Stem Cell Technologies, Inc. ("LICENSEE"), a Florida corporation with a
principal place of business located at 2109 E. Palm Avenue, Tampa, FL 33605.
RECITALS
1. ULRF was established by UofL to enter into and administer research
agreements with external funding sources in order to benefit the public
by the transfer of technology from UofL to the private sector for
development and commercialization;
2. ULRF owns the exclusive rights in certain Licensed Technology (as
defined below) including rights in any patent applications filed on,
and patents that issue on, such Licensed Technology;
3. The Inventors are employees of UofL and are obligated to assign all of
their right, interest and title in the Licensed Technology to ULRF;
4. Intentionally Omitted;
5. Intentionally Omitted;
6. ULRF desires to have the Licensed Technology perfected and marketed at
the earliest possible time to insure that products resulting therefrom
may be available for public use and benefit;
7. LICENSEE desires to obtain from ULRF certain rights for the commercial
development, use and sale of the Licensed Technology, and ULRF is
willing to grant such rights;
8. In consideration of the mutual promises contained herein and other good
and valuable consideration, the receipt and sufficiency thereof is
hereby acknowledged;
NOW, THEREFORE, ULRF and LICENSEE hereby agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
------------------------------
1.1 Definitions. Unless the context otherwise requires, the capitalized terms
used herein shall have the respective meanings specified or referred to in this
Section 1.1, or elsewhere in this Agreement.
1.1.1 "Affiliate" shall mean any corporation or other legal
entity which directly or indirectly controls, is
controlled by, or is under common control with
LICENSEE as of the Effective Date of this Agreement.
For the purpose of this Agreement, "control" shall
mean the direct or indirect ownership of greater than
fifty percent (50%) of the outstanding shares on a
fully diluted basis or other voting rights of the
subject entity to elect directors, or if not meeting
the preceding, any entity owned or controlled by or
owning or controlling at the maximum control or
ownership right permitted in the country where such
entity exists. For clarity, a party's status as an
Affiliate of LICENSEE shall terminate if and when
such control ceases to exist.
1.1.2 "Change of Control" shall mean: (a) the acquisition,
either directly or indirectly, by any third party of
more than fifty percent (50%) of the voting stock of
LICENSEE; (b) any merger or consolidation involving
LICENSEE that requires a vote of the stockholders of
LICENSEE; or (c) the transfer to any third party of
all or substantially all the assets of LICENSEE
relating to the subject matter of this Agreement.
1.1.3 "Field of Use" shall mean the field for which
Licensed Products may be designed, manufactured, used
or sold and shall be limited to the following field:
all fields, unless further restricted under Section
3.3 and excluding education, academic research,
teaching and public service.
1.1.4 "Net Sales" shall mean the gross sum which is
invoiced (and any revenues received but not billed)
to customers by LICENSEE or its Affiliates or
sublicensees for the use, sale or other transfer of
Licensed Products, less sales and/or use taxes
actually paid, import and/or export duties actually
paid, outbound transportation prepaid or allowed,
insurance agents' commissions and amounts allowed or
credited due to returns, rebates, discounts and the
like (not to exceed the original billing or invoice
amount). In the event Licensed Products are put into
use or otherwise disposed of, or if sales are made
other than by an arms-length transaction, or if
LICENSEE or its Affiliates or sublicensees receive
consideration other than cash for Licensed Products,
then the gross selling price shall not be less than
fair market value.
1.1.5 "Inventors" shall mean Drs. Mariusz Z. Ratajczak,
Magdalenda Kucia, and Janina Ratajczak.
1.1.6 "License Year" shall mean a year in which this
Agreement is in effect. The first License Year shall
begin on the Effective Date of this Agreement and run
until December 31 of the same calendar year.
Thereafter, each subsequent License Year shall mean
each subsequent calendar year, beginning January 1
and ending December 31, provided that the final
License Year shall end on the date of expiration or
termination of this Agreement.
2
1.1.7 "Licensed Patents" shall mean ULRF's United States
patents and patent applications identified in Exhibit
A, including any divisions, continuations (but not
continuations-in-part), and reissues and extensions
thereof, and any foreign counterparts and equivalents
thereof.
1.1.8 "Licensed Products" shall mean any product or service
in the Field of Use (i) that is covered by, or is
made by a process covered by, any Valid Claim, (ii)
for which the use, manufacture, import or sale would,
absent this license, infringe, induce infringement or
contribute to infringement of a Valid Claim, or (iii)
which is made with, uses or incorporates any Licensed
Technology. A Licensed Product may be marketed as a
separate single component or may be marketed as a
component of a more complex system or apparatus into
which it has been incorporated.
1.1.9 "Licensed Technology" shall mean collectively the
Licensed Patents identified in Exhibit A and any
unpatented inventions, discoveries or know-how as
further identified in Exhibit B.
1.1.10 "Licensed Territory" shall mean the world.
1.1.11 "Party" shall mean either LICENSEE or ULRF, and
"Parties" shall mean both LICENSEE and ULRF.
1.1.12 "Royalty Periods" shall mean the four (4) three month
periods during a License Year, the first beginning
January 1 and ending March 31, the second beginning
April 1 and ending June 30, the third beginning July
1 and ending September 30, the fourth beginning
October 1 and ending December 31; provided that the
first Royalty Period of this Agreement shall begin on
the Effective Date and end December 31 of that same
calendar year.
1.1.13 "Term" shall mean the term of this Agreement, which
shall begin on the Effective Date and continue until
the later of: (i) the latest date that a Valid Claim
exists; or (ii) twenty (20) years after the Effective
Date; or (iii) the date this Agreement is terminated
in accordance with the terms hereof.
1.1.14 "Valid Claim" shall mean:
(a) a claim of an issued patent within the Licensed
Patents that has not:
(i) expired or been canceled,
(ii) been finally adjudicated to be invalid
or unenforceable by a decision of a court or other
appropriate body of competent jurisdiction (and from
which no appeal is or can be taken),
(iii) been admitted to be invalid or
unenforceable through reissue, disclaimer or
otherwise, or
3
(iv) been abandoned in accordance with or as
permitted by the terms of this Agreement or by mutual
written agreement; or
(b) a claim included in a pending patent application
within the Licensed Patents, which claim is being
actively prosecuted in accordance with this Agreement
and which has not been:
(i) canceled,
(ii) withdrawn from consideration,
(iii) finally determined to be unallowable
by the applicable governmental authority (and from
which no appeal is or can be taken), or
(iv) abandoned in accordance with or as
permitted by the terms of this Agreement or by mutual
written agreement.
1.2 Interpretation. Each definition in this Agreement includes the singular
and the plural, and reference to the neuter gender includes the masculine and
feminine where appropriate. References to any statutes or regulations mean such
statutes or regulations as amended at the time of interpretation and include any
successor legislation or regulations. The headings to the Articles and Sections
hereof are for convenience of reference and shall not affect the meaning or
interpretation of this Agreement. Except as otherwise stated, reference to
Articles, Sections, and Exhibits mean the Articles, Sections and Exhibits of
this Agreement. Any Exhibits are hereby incorporated by reference into and shall
be deemed a part of this Agreement. Unless the context clearly indicates
otherwise, the word "including" means "including but not limited to." Any words
that are not defined within this Agreement shall have their ordinary dictionary
meaning.
ARTICLE 2
LICENSE GRANT AND RESERVATION OF RIGHTS
---------------------------------------
2.1 Exclusive License. Subject to LICENSEE's compliance with the terms and
conditions of this Agreement, ULRF hereby grants and LICENSEE hereby accepts an
exclusive, worldwide license under the Licensed Technology for the Term to make,
have made, develop, use, sell, offer to sell import and export Licensed Products
in the Fields of Use throughout the Licensed Territory.
2.2 Reservation of Rights.
2.2.1 ULRF and UofL reserve the right to license and
practice the Licensed Technology for noncommercial
purposes only, such as education, academic research,
teaching, and public service. Any transfer of
materials covered under the Licensed Patents shall be
accompanied by a material transfer agreement that
notifies the recipient of this License. The terms of
the material transfer agreement to be used by ULRF
for such transfers is attached to this Agreement as
Exhibit C; the terms of which may be modified upon
mutual agreement of the Parties. Upon request, ULRF
will provide LICENSEE with a list of its academic or
nonprofit recipients which have executed any such
material transfer agreement.
4
2.2.2 The Inventors of the Licensed Technology reserve the
right to practice the technology solely as provided
in Section 2.2.1 above, for their own noncommercial
educational and research purposes.
2.2.3 Nothing in this Agreement shall be construed as
granting any license, title or any interest, by
assumption, implication, estoppel or otherwise, to
any patent or other rights not specifically listed as
Licensed Technology.
2.2.4 LICENSEE understands and agrees that ULRF may publish
or otherwise disseminate information concerning the
Licensed Technology at any time in accordance with
the provisions of confidentiality set forth in
Article 11.
ARTICLE 3
DUE DILIGENCE BY LICENSEE
-------------------------
3.1 Due Diligence by LICENSEE. LICENSEE represents to ULRF, to induce ULRF
to enter into this Agreement for the licensing of Licensed Technology, that
LICENSEE will engage in a diligent program as herein set forth exploiting the
Licensed Technology with the goal of public utilization resulting therefrom.
LICENSEE represents and warrants that it will use reasonable commercial efforts
to obtain the expertise necessary to develop the Licensed Technology with the
goal of developing the Licensed Products in accordance with the terms of this
Agreement. If the Licensed Products are subject to United States regulatory
approval prior to marketing, LICENSEE shall use reasonable commercial efforts to
market the Licensed Products in the United States within * of receiving
regulatory approval to market such Licensed Products, subject to reasonable
extension as may be requested by Licensee. Following the first commercial sale
of the Licensed Products, LICENSEE shall use reasonable commercial efforts to
reasonably fill the market demand for Licensed Products at all times during the
Term.
3.2 Development Records. LICENSEE shall maintain documentation evidencing
that LICENSEE (including Affiliates and sublicensees) is pursuing development of
Licensed Products as required herein. Such documentation may include, but is not
limited to, invoices for studies advancing development of Licensed Products,
laboratory notebooks, internal job cost records, and filing made to the Internal
Revenue Service to obtain tax credits, if available, for research and
development of Licensed Products.
3.3 Development Plan. Upon execution of this Agreement, LICENSEE shall
submit an initial Development Plan outlining work to be completed during the
first * of the Research Period (as defined in the Sponsored Research Agreement
described in Section 3.6 herein), which shall also serve as the research plan of
the Sponsored Research Agreement. Within a reasonable time, but in no event
later than * from the commencement of the Research Period, LICENSEE shall
provide ULRF with a list of its desired, specific fields of use of the Licensed
Technology and the definition of Field of Use set forth in 1.1.3 shall be deemed
amended accordingly. In addition, within * from the commencement of the Research
Period, LICENSEE will provide ULRF with a draft Development Plan written in the
format set forth in Exhibit D for each specific field of use of the Licensed
Technology included on the aforementioned list, satisfactory to ULRF, in its
reasonable discretion and describing the steps it intends to take which it
believes in good faith will result in allowing the inventions of the Licensed
Patents to be utilized to provide Licensed Products for sale in the commercial
market, which shall further include those steps taken, or to be taken, by
Affiliates and sublicensees, as it may have been advised by Affiliates and
sublicensees. For each specified field of use included on the aforementioned
list for which ULRF does not receive a timely Development Plan from LICENSEE
satisfactory to ULRF in its reasonable discretion, ULRF may withdraw that field
of use from this Agreement the definition of Field of Use in 1.1.3 shall again
be deemed amended to reflect the narrowed fields of use and ULRF may license
such use to a third party, subject to prior notice to Licensee and an
opportunity to cure as set forth in Section 12.1.1.1. For each new field of use
desired by LICENSEE but not included on the list submitted to ULRF by LICENSEE
at the end of * from the commencement of the Research Period, LICENSEE may
request the addition of the new field(s) of use and its corresponding
Development Plan to this Agreement in accordance with Section 13.3 of this
Agreement.
5
3.4 Development Report. Annually, commencing on January 1, 2009, LICENSEE
shall provide ULRF with a written Development Report in order to keep ULRF
informed of its progress. Such report shall contain substantially the
information set forth in Exhibit E, including any relevant considerations
involving any Affiliates and sublicensees as well as any necessary adjustments
to the Development Plan. ULRF's review of LICENSEE's Development Report is
solely to verify the existence of LICENSEE's commitment to the development
activity and to assure compliance with LICENSEE's obligations to utilize the
Licensed Technology to commercialize the Licensed Products for the marketplace,
as set forth above.
3.5 Auditing and Review of Development Records. ULRF reserves the right to
audit LICENSEE's records relating to the development of Licensed Products as
required hereunder. Such requirements for LICENSEE's record keeping and ULRF's
audit thereof shall be subject to the same procedures and restrictions set forth
for audit of financial records of LICENSEE in Section 5.7.
3.6 Sponsored Research; Collection Center Agreement. LICENSEE recognizes
the expertise of the Inventors in the Licensed Technology. ULRF and LICENSEE
acknowledge that ULRF and NeoStem, Inc. ("NeoStem") shall execute a Sponsored
Research Agreement ("SRA") which will serve as a basis for LICENSEE's diligence
obligations hereunder. Furthermore, NeoStem and ULRF intend to enter into a
collection center agreement soon after the execution of this Agreement,
including making all filings and receiving all necessary approvals with respect
to an investigational new drug application and institutional review board for
the collection of stem cells as contemplated in the collection center agreement.
3.7 Conversion of License. If LICENSEE fails to perform in any material
respect its obligations specified in Article 3, then ULRF shall have the right
and option to either terminate this Agreement as provided in Section 12.1.1.1 or
convert LICENSEE's exclusive license to a non-exclusive license, subject to the
non-binding mediation and dispute resolution procedures provided in Section
13.10, subject to prior notice to Licensee and an opportunity to cure as set
forth in Section 12.1.1.1.
ARTICLE 4
SUBLICENSING BY LICENSEE
------------------------
4.1 Sublicenses. LICENSEE may not grant any sublicenses without the prior
written approval of ULRF which shall not be unreasonably witheld, unless the
following conditions are met: LICENSEE provides thirty (30) days advance written
notice to ULRF; LICENSEE has used good faith efforts to assure itself of the
integrity and financial responsibility of the sublicensee; the sublicensee has
received and executed a license agreement binding it to all of the obligations,
terms and conditions that obligate, bind or affect LICENSEE under this Agreement
to the extent that such obligations, terms and conditions are relevant given the
nature of the right to be granted by LICENSEE to the sublicensee; LICENSEE
remits to ULRF all royalties that become payable, under Sections 5.3 and 5.4;
and sublicensee is a publicly traded company, or if not a publicly traded
company, has annual sales exceeding One Million Dollars ($1,000,000). LICENSEE
agrees to provide ULRF with (i) the identity of any proposed sublicensee, and
(ii) a true, correct and complete copy of the terms of any proposed sublicense
at the time that LICENSEE seeks approval or provides notice. In the event that
the original license with ULRF is terminated, all sublicenses would survive
termination of the original license, and ULRF shall have the option to convert
sublicenses to nonexclusive licenses.
6
ARTICLE 5
CONSIDERATION
-------------
5.1 License Issue Fee. LICENSEE shall pay to ULRF a non-creditable,
non-refundable License Issue Fee of * . Said License Issue Fee shall be payable
by LICENSEE to ULRF upon the commencement of the Research Period as described in
Section 3.3.
5.2 License Maintenance Fee. LICENSEE shall pay ULRF a License Maintenance
Fee of * due by January 31 of each calendar year upon issuance of the Licensed
Patent in the United States. This annual maintenance fee payment will be
nonrefundable and will not be creditable against any other payments due to ULRF
under this Agreement.
5.3 Earned Royalty.
5.3.1 For any use or sale of Licensed Products, including
the Licensed Products used and/or sold in connection
with quantitating VSEL Stem Cells, LICENSEE shall pay
to ULRF a royalty of * of Net Sales. Royalties due
under this Section 5.3 shall be payable on a
country-by-country and Licensed Product-by-Licensed
Product basis until the expiration or termination of
this Agreement. Royalties shall accrue when the
Licensed Product is invoiced, or if not invoiced,
when delivered to a third party. For purposes of
clarity, ULRF is not entitled to a royalty payment on
NeoStem's current collection and processing services.
5.3.2 Stacking. In the event during any Royalty Period,
LICENSEE's total combined royalty burden for Licensed
Patents and Enabling Technology (the "Total Royalty
Stack") exceeds * of Net Sales (the "Royalty Stack
Cap") the Earned Royalty payable by LICENSEE to ULRF
for that Royalty Period shall be reduced such that
for every * paid for Enabling Technology, * may be
deducted from Earned Royalties owed to ULRF; provided
however, that under no circumstance shall the Earned
Royalty be less than * . For purposes of this Section
5.3.2, "Enabling Technology" means any and all
additional third party licenses and rights which are
required by LICENSEE for the practice of Licensed
Patents or the manufacture of Licensed Products
hereunder.
5.4 Sublicensing Consideration. In the event a sublicense is granted by
LICENSEE hereunder, LICENSEE shall pay to ULRF * of all consideration (other
than on Net Sales owed under Section 5.3) received by LICENSEE from the
sublicensing of any rights granted under Section 2.1 of the Agreement. Such
amounts shall be paid along with the earned royalties under Section 5.3.
5.5 Milestone Payments. For the specific fields of use identified on the
list due to ULRF by LICENSEE at the end of * from the commencement of the
Research Period as described in Section 3.3, LICENSEE shall pay to ULRF the
following milestone payments within thirty days of the event set forth below:
7
o *
o *
o *
5.6 Royalty Payment and Report. Within thirty (30) days after the end of
each Royalty Period, commencing with the date of the first commercial sale of
Licensed Products including the Licensed Products used and/or sold in connection
with quantitating VSEL Stem Cells, LICENSEE shall provide to ULRF a written
report (even if there are no sales) detailing LICENSEE's (and each Affiliate's
and sublicensee's) sales activities during such Royalty Period. Each report
shall contain the information specified in the form attached hereto as Exhibit
F. Concurrent with the making of each such report, LICENSEE shall include
payment due ULRF of royalties for the Royalty Period covered by such report. If
no payment is due for any such period, LICENSEE shall so state.
5.7 Accounting. LICENSEE shall keep and maintain records for a period of
six (6) years from the date of creation, which show the manufacture, sale,
lease, use, and other disposition of Licensed Products sold or otherwise
disposed of under the licenses herein granted. Such records will include general
ledger records showing cash receipts and expenses, and records which include
production records, customers, and related information, in sufficient detail to
enable the royalties payable hereunder by LICENSEE to be determined. LICENSEE
will permit an independent certified public accountant as well as an internal
ULRF auditor to have reasonable access annually upon reasonable notice and
within six (6) months after termination of this Agreement, to audit, during
ordinary business hours, such records as may be necessary to verify or determine
royalties or other payments paid or payable under this Agreement. Such auditor
or other person shall be instructed to report to ULRF only information related
to determining the amount of royalties or other payments due and payable.
LICENSEE shall reimburse ULRF all unpaid royalties, plus interest as set forth
in Section 5.8, within thirty (30) days after receiving a written audit report.
ULRF shall pay the cost of the audit unless the results of the audit reveal an
under-reporting or an underpayment of royalties due ULRF of five percent (5%) or
more, in which case LICENSEE shall pay the audit costs.
5.8 Interest. The royalty and other payments set forth in this Agreement
shall, if overdue, bear interest until payment at the monthly rate of [(P+2)/12]
%, where P is the prime rate quoted in the Wall Street Journal on the day such
royalty becomes due. The payment of such interest shall not foreclose ULRF from
exercising any other rights it may have as a consequence of the lateness of any
payment.
5.9 Payment Procedures. All payments due from LICENSEE to ULRF hereunder
shall be in U.S. currency by check or money order payable to the "University of
Louisville Research Foundation, Inc." With respect to sales in countries outside
the United States, royalties shall be payable in US dollars at the rate of
exchange published in the Wall Street Journal on the close of business on the
last banking day of each Royalty Period in which the royalty accrues. Royalties
shall be paid to the ULRF free and clear of all foreign taxes. Such payments
shall reference the UofL tax identification number #61-1029626 and shall be
remitted to the address for ULRF specified in Section 13.1 of this Agreement.
5.10 Non-U.S. Taxes. LICENSEE will pay all non-U.S. taxes related to
royalty payments. These payments are not deductible from any payments due to
ULRF.
8
ARTICLE 6
PATENT PROSECUTION
------------------
6.1 Prosecution and Maintenance of Licensed Patents and Payment of Patent
Costs. Upon execution of this Agreement, LICENSEE will assume responsibility of
taking the lead on patent drafting and prosecution activities for the Licensed
Patents as described below in this Article 6. Provided that LICENSEE timely
makes all of its payments under this ARTICLE, subject in each case to notice and
forty-five days to cure any nontimely payment as provided in Section 12.1, the
following shall apply:
6.1.1 Reimbursement of Prior Patent Expenses. Upon execution of this
Agreement, LICENSEE shall reimburse ULRF in the amount of *
for all expenses related to patent filing and prosecution
incurred prior to the Effective Date.
6.1.2 Future Patent Office Expenses. Future patent expenses
shall be borne as follows:
6.1.2.1 LICENSEE will bear all costs, including ULRF's
counsel fees (for reviewing and approving of filing
and prosecution as described below) incurred in
connection with such preparation, filing, prosecution
and maintenance of Licensed Patents. Any necessary
reimbursement by LICENSEE to ULRF for such costs
shall occur within thirty (30) days after receipt of
each invoice sent by ULRF to LICENSEE. ULRF shall use
reasonable efforts to minimize reimbursable expenses
by only utilizing external counsel on actions for
which ULRF requires expert advice.
6.1.2.2 Prepayment of Future Patent Office Expenses. Upon the
commencement of the Research Period, LICENSEE shall
pay a non-refundable * , which shall be creditable
against the first * of patent expenses incurred after
the Effective Date of this Agreement.
6.1.3 Counsel and Joint Representation. LICENSEE may choose counsel
from ULRF's pre-approved list of counsel, or any other counsel
subject to ULRF's final approval, such approval not to be
unreasonably withheld. Counsel shall provide concurrently to
both Parties copies of all drafts, prosecution documents and
correspondence for pending U.S. and foreign patent
applications.
6.1.4 Patent Prosecution. LICENSEE shall formally direct patent
prosecution and shall concurrently copy ULRF on all
communication with counsel related to the Licensed Patents.
LICENSEE will provide ULRF with ample opportunity to review
and approve patent drafts and prosecution activities (either
internally or with assistance from ULRF retained counsel, as
appropriate), and shall incorporate any suggestions or changes
made by ULRF.
6.1.5 Timing for Notice of Non-Election. In the event that LICENSEE
shall elect not to continue prosecution or pay for the
maintenance of any Licensed Patents, or for the filing,
prosecution and maintenance of patent applications and patents
which issue thereunder in accordance with this Agreement,
LICENSEE shall provide ULRF with written notice of
non-election at least thirty (30) days before the date patent
related actions or fees are due or such other period of time
as may be reasonable under the circumstances, and shall turn
over patent prosecution toULRF. In the event LICENSEE does not
provide sufficient notice, LICENSEE shall be responsible for
reasonable expenses incurred by ULRF as related to the
above-mentioned actions or fees that are due less than thirty
(30) days from the date LICENSEE's notice of non-election is
provided.
9
6.1.6 Recovery of Patents. In the event that LICENSEE shall elect
not to pay for the maintenance of any Licensed Patent, or for
the filing, prosecution and maintenance of patent applications
and patents which issue thereunder, then such Patent(s) and
patent applications shall cease to be considered Licensed
Technology and shall no longer be subject to the exclusive
license provisions of Article 2. LICENSEE shall cease
utilizing technology covered by such recovered patents and
ULRF shall be free to seek out a new licensee for the same
recovered patents in any field, including the Field of Use.
Non-payment of any material portion of patent expenses with
respect to the maintenance of any Licensed Patent, or for the
filing, prosecution and maintenance of patent applications and
patents which issue thereunder, shall be deemed by ULRF as an
election by LICENSEE to terminate its reimbursement
obligations regarding such patent or application and its
license rights thereto. LICENSEE shall cooperate with ULRF as
reasonably requested to facilitate ULRF's filing, prosecution
and maintenance of recovered patents.
6.2 Patent Term Extensions. If requested by LICENSEE, ULRF shall cooperate
with LICENSEE to apply for an extension of the term of any patent in the
Licensed Patents 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. ULRF shall assist LICENSEE, if so requested, in preparing all
documents for such application, and ULRF shall execute such documents and take
any other additional action as LICENSEE reasonably requests in connection
therewith. LICENSEE shall pay expenses incurred by the foregoing.
ARTICLE 7
EXCLUSIONS AND NEGATIONS OF WARRANTIES; LIMITATION OF LIABILITY;
----------------------------------------------------------------
REPRESENTATIONS
---------------
7.1 Negation of Warranties. ULRF provides LICENSEE the rights
granted in this Agreement AS IS and WITH ALL FAULTS. ULRF
makes no representations other than as set forth herein and
extends no warranties of any kind, either express or implied.
Among other things, ULRF disclaims any express or implied
warranty:
7.1.1 of merchantability, of fitness for a particular
purpose;
7.1.2 of non-infringement; or
7.1.3 arising out of any course of dealing.
7.2 No Representation of Licensed Patent. LICENSEE also acknowledges that
ULRF does not represent or warrant:
7.2.1 the validity or scope of any Licensed Patent; or
7.2.2 that the exploitation of Licensed Patent will be
successful.
7.3 Representations of ULRF and LICENSEE.
10
7.3.1 Representations of the Parties: The Parties represent
to the best of their knowledge that:
(a) the execution and delivery of this Agreement
and the performance of the transactions
contemplated hereby have been duly
authorized by all appropriate corporate
action of such party; and
(b) this Agreement is a legal and valid
obligation binding upon such Party and
enforceable in accordance with its terms,
and the execution, delivery and performance
of this Agreement by the Parties does not
conflict with any agreement, instrument or
understanding to which such Party is a party
or by which it is bound.
7.3.2 Additional Representations of ULRF. ULRF represents
to the best of its knowledge that:
(a) ULRF is the sole owner of the entire right,
title and interest in and to the Licensed
Patents and Licensed Technology;
(b) ULRF has the full right and legal capacity
to grant the rights granted to LICENSEE
hereunder without violating the rights of
any third party and there are no rights in
the Licensed Technology or Licensed Patents
held by any governmental authority; and
(c) to the best of ULRF's knowledge, Licensed
Patents have been properly filed and
prosecuted.
7.4 No Warranties to Third Parties. LICENSEE shall not make any
statements, representations or warranties or accept any liabilities or
responsibilities whatsoever to or with regard to any person or entity that are
inconsistent with any disclaimer or limitation included in this Article 7.
7.5 Limitation of Liability. THE ENTIRE RISK AS TO PERFORMANCE OF
LICENSED PRODUCTS IS ASSUMED BY LICENSEE. IN NO EVENT SHALL ULRF, INCLUDING ITS
TRUSTEES, FELLOWS, OFFICERS, EMPLOYEES, STUDENTS AND AGENTS, BE RESPONSIBLE OR
LIABLE FOR ANY DIRECT, INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL OR OTHER
DAMAGES WHATSOEVER, OR LOST PROFITS OR OTHER ECONOMIC LOSS OR DAMAGE WITH
RESPECT TO LICENSED PRODUCTS, WHETHER GROUNDED IN TORT (INCLUDING NEGLIGENCE AND
PRODUCT LIABILITY), STRICT LIABILITY, CONTRACT OR OTHERWISE. THE ABOVE
LIMITATIONS ON LIABILITY APPLY EVEN THOUGH ULRF, ITS TRUSTEES, FELLOWS,
OFFICERS, EMPLOYEES, STUDENTS OR AGENTS, MAY HAVE BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGE.
ARTICLE 8
INDEMNITY & INSURANCE
---------------------
8.1 Indemnity.
8.1.1 LICENSEE shall indemnify, hold harmless, and defend ULRF and its
trustees, fellows, officers, employees, students, and agents, from and against
any and all claims, suits, losses, damage, costs, fees, and expenses (including
attorneys' fees) resulting from or arising out of the exercise of the licenses
granted hereunder, or any sublicense thereof, by LICENSEE or its Affiliates or
sublicensees except to the extent such losses arise from ULRF's gross negligence
or willful misconduct. This indemnification shall include, but not be limited
to, any product liability.
11
8.1.2 To the extent allowed by applicable Kentucky law (Kentucky
Revised Statutes 44.070 et seq.), ULRF will defend, indemnify and hold harmless
LICENSEE, its officers, directors employees, agents and assigns from and against
any and all claims, suits, losses, damage, costs, fees and expenses (including
attorneys' fees) which may result from any error or omission arising out of
ULRF's performance under this Agreement.
8.2 Insurance. During the Term and for one year thereafter, LICENSEE shall
obtain and maintain at all times and shall require its Affiliates and
sublicensees, and any subcontractors of any of the foregoing, to obtain and
maintain (i) insurance for all statutory workers' compensation and employers'
liability requirements covering any and all employees with respect to activities
performed under this Agreement; and (ii) comprehensive general liability
insurance, including products liability insurance, with reputable and
financially secure insurance carriers to cover their respective activities. Such
insurance shall provide minimum limits of liability of $5,000,000 (which the
Parties believe to currently be an appropriate level of coverage for the
activities contemplated by this Agreement and which shall be reviewed from time
to time by Licensee to assess its continued appropriateness and increase such
levels should it consider it to be warranted) and shall include ULRF, its
trustees, fellows, officers, employees, students, and agents as additional
insureds. Such insurance shall be written to cover claims incurred, discovered,
manifested, or made at any time during or after the expiration or termination of
this Agreement. At ULRF's request, LICENSEE shall furnish a certificate of
insurance evidencing primary coverage, indicating that ULRF has been endorsed as
an additional insured under coverage referred to above, and requiring thirty
(30) days prior written notice to ULRF of cancellation or material change. All
such insurance of LICENSEE shall be primary coverage; the insurance of ULRF
shall be deemed to be excess and noncontributory. ULRF shall notify LICENSEE in
writing of any claim brought against ULRF in respect to which ULRF intends to
invoke the provisions of this Section. LICENSEE shall keep ULRF informed in
writing and on a current basis of LICENSEE's defense(s) of any known claim under
this Section.
ARTICLE 9
MARKING; USE OF NAMES AND TRADEMARKS
------------------------------------
9.1 Marking. Prior to the issuance of a Licensed Patent, LICENSEE shall
mark Licensed Products (or their containers or labels if the Licensed Products
are not capable of being marked) made, sold, or otherwise disposed of by
LICENSEE under the license granted in this Agreement with the words "Patent
Pending" if a patent application is pending. Following the issuance of Licensed
Patent(s), LICENSEE shall mark Licensed Products (or their containers or labels
if the Licensed Products are not capable of being marked) with the serial
numbers of the Licensed Patents. All Licensed Products shipped to or sold in
other countries shall be marked in such a manner as to conform with the patent
laws and best practices of the country of manufacture or sale.
9.2 Use of Names and Trademarks. Neither Party shall, without the prior
written consent of the other Party (which consent shall not be unreasonably
withheld), identify the other Party in any advertising or other promotional
materials to be disseminated to the public or use the name of any faculty member
(with the exception of any ULRF Inventors who are employed by, partners in, or
consultants of the LICENSEE), employee, or student of ULRF or UofL, or any
trademark, service mark, trade name, or symbol owned by or associated with the
other Party ULRF or UofL. The restrictions imposed by this Section shall not
prohibit either Party from making any disclosure identifying the other Party
that is required by applicable law or the requirements of a national securities
exchange or another similar regulatory body.
12
9.3 Notwithstanding the foregoing, either Party may state that LICENSEE is
licensed by ULRF under one or more of the patents or applications comprising the
Licensed Patents.
ARTICLE 10
INFRINGEMENT
------------
10.1 Infringement.
10.1.1 LICENSEE shall promptly notify ULRF of any suspected
infringement of any Licensed Patent by a third party and
furnish ULRF with any available evidence thereof.
10.1.2 ULRF shall have the right, but shall not be obligated, to
prosecute at its own expense all infringements of the Licensed
Patents, and, in furtherance of such right, LICENSEE hereby
agrees that ULRF may include LICENSEE as a party plaintiff in
any such suit, without expense to LICENSEE. ULRF shall notify
LICENSEE in writing in the event that ULRF decides to initiate
suit. The total cost of any such infringement action commenced
or defended solely by ULRF shall be borne by ULRF and from any
recovery or damages for past infringement derived therefrom,
ULRF shall be reimbursed its out-of-pocket costs and attorney
fees, then ULRF shall receive any sums of money that would
have been paid to ULRF if said infringement had not occurred,
then LICENSEE shall be reimbursed for any awards characterized
as lost profits to LICENSEE if said infringement had not
occurred, and then any remaining balance shall be retained by
ULRF. In the event that a non-cash cross license is awarded or
a non-cash settlement is reached, both Parties agree to
negotiate appropriate compensation in good faith.
10.1.3 If, four (4) months after having been notified of any alleged
infringement, ULRF is unsuccessful in persuading the alleged
infringer to desist and ULRF has not brought suit against the
alleged infringer, or if ULRF has notified LICENSEE at any
time prior thereto of its intention not to bring suit against
any alleged infringer, then, and in those events only,
LICENSEE shall have the right, but shall not be obligated, to
prosecute at its own expense any infringement of the Licensed
Patent. If LICENSEE chooses to prosecute such a suit, LICENSEE
shall notify ULRF in writing within forty-five (45) days after
the date ULRF notifies LICENSEE of ULRF's intention not to
bring suit. LICENSEE may, for such purposes, withhold up to
thirty percent (30%) of royalties otherwise payable to ULRF to
offset up to thirty percent (30%) of its infringement
litigation expenses. LICENSEE may use the name of ULRF as
party plaintiff; provided, however, that such right to bring
such an infringement action shall remain in effect only for so
long as the license granted herein remains in effect. No
settlement, consent judgment or other voluntary final
disposition of the suit may be entered into without the
consent of ULRF, which consent shall not be unreasonably
withheld. LICENSEE shall indemnify ULRF against any order for
costs that may be made against ULRF in such proceedings. Any
recovery of damages for past infringement delivered therefrom
shall first reimburse LICENSEE for any of its out-of-pocket
costs and attorney fees, then reimburse ULRF for the thirty
percent (30%) of royalties that LICENSEE withheld from ULRF,
then reimburse LICENSEE for its lost profits, then reimburse
ULRF for any sums of money that would have been paid to ULRF
if said infringement had not occurred, and then any balance
shall be equally divided between the Parties.
13
10.1.4 Both Parties shall use reasonable efforts and cooperation to
terminate infringement without litigation.
ARTICLE 11
CONFIDENTIALITY AND PUBLICATION
-------------------------------
11.1 Confidentiality. Each Party agrees to keep confidential any
Confidential Information disclosed by the other Party hereunder using methods at
least as stringent as such Party uses to protect its own confidential
information, and understands that this Section shall survive any termination of
this Agreement. "Confidential Information" means confidential or proprietary
information of a Party that shall be designated confidential at the time of
disclosure by the disclosing Party either orally or in writing. If designated
confidential orally, the disclosing Party shall within thirty (30) days of the
date of disclosure confirm in writing the confidential nature of such
information. In the case of LICENSEE, Confidential Information shall include
LICENSEE's Development Plan and Development Reports, Licensed Products and all
information concerning them. The receiving Party shall use reasonable efforts to
ensure said Confidential Information is kept confidential and shall promptly
return or destroy all originals and copies of Confidential Information at the
written request of the disclosing Party. Except as otherwise provided herein,
for a period of five (5) years following the date of such disclosure, the
receiving Party will not disclose the Confidential Information without the
consent of the disclosing Party and shall use such Confidential Information only
for the purposes of this Agreement. Not withstanding the foregoing and except as
may be authorized in advance in writing by the disclosing Party, the receiving
Party may transfer the disclosing Party's Confidential Information to those of
receiving Party's employees, students, officers, directors and agents as may be
reasonably necessary to carry out the performance of this Agreement. Each Party
agrees not to use any Confidential Information other than as provided hereunder.
The confidentiality and use obligations set forth above apply to all or any part
of the Confidential Information disclosed hereunder except to the extent that:
11.1.1 the receiving Party can show by written records that it
possessed the information prior to its receipt from the other
Party;
11.1.2 the information was already in the public domain or became so
through no fault of the receiving Party;
11.1.3 the information is subsequently disclosed to the receiving
Party by a third Party that has the right to disclose it free
of any obligations of confidentiality;
11.1.4 the information is required to be disclosed by law or court
order; or
14
11.1.5 five (5) years have elapsed from the expiration of this
Agreement.
Notwithstanding the foregoing, each Party shall have the right to disclose the
Confidential Information of the other Party to any actual or prospective
investors, acquirers, lenders and other potential financing sources who are
obligated to keep such information confidential.
ARTICLE 12
TERMINATION
-----------
12.1.1 Termination.
12.1.1.1 Either Party may terminate this Agreement immediately
upon notice to the other if the other Party is in
material breach of any provision of this Agreement,
including, but not limited to, failure to perform in
any material respect the due diligence obligations
specified in Article 3, failure to make any material
payments under any section of Articles 5 and 6,
failure to maintain levels of insurance specified
herein, and failures to maintain confidentiality and
representations and warranties and such breach is not
cured by such breaching Party within thirty (30) days
after written notice thereof by the non-breaching
Party.
12.1.1.2 Either Party may terminate this Agreement immediately
upon written notice to the other Party in the event
the other Party (i) files a petition under any
bankruptcy or insolvency act or has any such petition
filed against it which is not discharged within sixty
(60) days of the filing thereof; (ii) makes an
assignment for the benefit of its creditors or an
offer of settlement, extension, or composition to its
unsecured creditors generally; or (iii) appoints or
suffers an appointment of a trustee, conservator,
receiver, or similar fiduciary for substantially all
of the assets of such Party.
12.1.1.3 LICENSEE may terminate this Agreement for any reason
within sixty (60) days after written notice thereof
by LICENSEE.
12.2 Consequences of Termination. Upon termination of this Agreement for
any reason, nothing herein shall be construed to release either Party from any
obligation that matured prior to the effective date of such termination. ULRF
shall negotiate such license in good faith under reasonable terms and
conditions. Upon termination, LICENSEE shall remain obligated to provide, in the
form specified in Article 5 of this Agreement, an accounting for and pay
royalties earned up to the date of termination. Any such payments or reports due
to ULRF shall be sent to ULRF within thirty (30) days of termination. In the
event of such termination, ULRF shall have no obligation to refund any license
or royalty fees or other amounts paid by LICENSEE to ULRF under this Agreement
or any other agreement between the Parties. Additionally, in the event of
termination by ULRF for any reason provided herein or by LICENSEE pursuant to
Section 12.1.1.3, LICENSEE may for one (1) year following the date of
termination, sell inventoried Licensed Products, provided that LICENSEE shall
pay to ULRF the royalties thereon as required by Article 5 of this Agreement and
shall submit the related reports as required by Article 5 of this Agreement.
15
12.3 Survival upon termination. The following provisions shall survive any
termination or expiration of this Agreement: Articles 1, 7, 8, 11, and 13 and
Sections 5.6, 5.7, 5.8, 5.9, 5.10, 12.2 and 12.3.
ARTICLE 13
MISCELLANEOUS PROVISIONS
------------------------
13.1 Notices. All notices required or permitted to be given under this
Agreement shall be effective when given in writing, with reference to this
Agreement and when (a) delivered personally; (b) sent by confirmed facsimile;
(c) five (5) days after having been sent by United States mail, registered or
certified, return receipt requested, postage prepaid; or (d) two (2) days after
deposit with a commercial overnight carrier, with written verification of
receipt. All communications shall be sent to the applicable Party's address set
forth below or to such other address as may be designated by written notice.
To ULRF: If by Regular Postal Service:
University of Louisville
Office of Technology Transfer
Attn.: Director
201 E. Jefferson Street
Louisville, KY 40202
Phone (502) 852-2965
Fax (502) 852 2410
To LICENSEE:
Stem Cell Technologies, Inc.
2109 E. Palm Avenue
Tampa, FL 33605
Attention: Jennifer Willis, President
13.2 Assignment. While this Agreement is freely assignable by ULRF, this
Agreement is personal to LICENSEE and may not be assigned or delegated accept as
further described below, in whole or in part, by LICENSEE without the prior
written consent of ULRF, which shall not be unreasonably withheld. A Change in
Control shall not be considered an assignment for purposes of this Section 13.2
unless such Change in Control causes LICENSEE or its Affiliates to engage in any
morally objectionable activities including: activities designed to defame,
embarrass, harm, abuse, threaten, slander or harass third parties; activities
prohibited by the laws of the United States and/or foreign territories in which
LICENSEE conducts business; activities designed to encourage unlawful behavior
by others, such as hate crimes, terrorism and child pornography; activities that
are tortuous, vulgar, obscene, invasive of the privacy of a third party,
racially, ethnically, or otherwise objectionable; activities designed to harm
minors in any way Any attempted assignment in violation of this Section 13.2
shall be void and of no effect. It is understood that upon execution of this
Agreement, LICENSEE shall be acquired by NeoStem, Inc. and all rights and
responsibilities provided for in this Agreement shall be binding upon and inure
to the benefit of NeoStem, Inc.
13.3 Entire Agreement; Amendments. This Agreement contains the entire
understanding of the Parties with respect to the matter contained herein. The
Parties may, from time to time during the continuance of this Agreement, modify,
vary or alter any of the provisions of this Agreement, but only by an instrument
duly executed by authorized officials of both Parties hereto and only if such
instrument specifically states that it is an amendment to this Agreement.
16
13.4 Invalidity. In the event that any provision of this Agreement shall be
determined by a court of competent jurisdiction to be invalid, illegal or
unenforceable, that provision will be curtailed, limited or deleted, but only to
the extent necessary to remove such invalidity, illegality or unenforceability,
and the remaining provisions shall not in any way be affected or impaired
thereby. In the event that such curtailment, limitation or deletion is not
allowed by relevant law or if such curtailment, limitation or deletion changes
any essential basis of the bargain set forth in this Agreement, the Parties
agree to substitute a new provision as similar in effect to the deleted
provision as may be allowed by relevant law.
13.5 Force Majeure. Neither Party hereto shall be deemed to be in default
of any provision of this Agreement, or for any failure in performance, resulting
from acts or events beyond the reasonable control of such Party, such as Acts of
God, acts of civil or military authority, including denial or cancellation of
any export or other necessary license, civil disturbance, war, strikes, fires,
power failures, natural catastrophes or other "force majeure" events.
13.6 Waiver. No waiver by either Party of any breach of this Agreement, no
matter how long continuing or how often repeated, shall be deemed a waiver of
any subsequent breach thereof, nor shall any delay or omission on the part of
either Party to exercise any right, power, or privilege hereunder be deemed a
waiver of such right, power or privilege. All waivers must be in writing and
signed by the Party to be charged with such waiver.
13.7 No Agency. The relationship between the Parties is that of independent
contractors. Neither Party shall be deemed to be an agent of the other in
connection with the exercise of any rights hereunder, and neither shall have any
right or authority to assume or create any obligation or responsibility on
behalf of the other.
13.8 Jurisdiction and Forum. The state and federal courts located in the
Commonwealth of Kentucky shall have exclusive jurisdiction over any claim or
dispute concerning or arising out of this Agreement and shall apply the laws of
the Commonwealth of Kentucky (excluding its body of law controlling conflicts of
law) in construing and interpreting this Agreement. The Parties hereby
irrevocably consent to the exclusive jurisdiction of such courts and irrevocably
waive any claim of inconvenient forum; provided that, notwithstanding the
foregoing, either Party shall have the right to seek injunctive relief and the
enforcement of judgments in any court of competent jurisdiction, no matter where
located.
13.9 Laws and Regulations of the United States and Export. This Agreement
shall be subject to all United States laws and regulations now or hereafter
applicable to the subject matter of this Agreement. Each Party shall comply with
all provisions of any applicable laws, regulations, rules and orders relating to
the license herein granted and to the testing, production, transportation,
export, packaging, labeling, sale or use of Licensed Products, or otherwise
applicable to such Party's activities hereunder. LICENSEE hereby gives written
assurance that it will comply with, and will make reasonable commercial efforts
to cause its sublicensees to comply with, all United States export control laws
and regulations.
13.10 Dispute Resolution. In the event the Parties cannot resolve a
dispute, which arises under this Agreement, the Parties agree to submit the
dispute to non-binding mediation. Either Party may request mediation by sending
a written notice to the other Party, and the mediation shall be held in a
mutually agreeable place in Louisville, Kentucky, at a mutually agreeable time,
within thirty (30) days of the date of request for mediation. The Parties shall
select a mediator who is acceptable to both of them, and if they cannot agree on
a mediator, then each shall select their own mediator, and the two mediators
shall serve in tandem to mediate the dispute. If as a result of the mediation
the Parties do not resolve their dispute, then either Party shall have the right
to pursue any other legal or equitable remedies it may have. Should dispute
resolution be unsuccessful, the Parties agree that no written or oral
representation made during the course of the settlement shall constitute a party
admission.
17
THEREFORE, the Parties have executed this Agreement in duplicate
originals by their duly authorized officers or representatives.
UNIVERSITY OF LOUISVILLE Stem Cell Technologies Inc.
RESEARCH FOUNDATION, INC.
/s/ Manuel Martinez-Maldonado /s/ Jennifer Willis
Manuel Martinez-Maldonado, EVPR Jennifer Willis, President
Date November 12, 2007 Date November 12, 2007
----------------- -----------------
Attachments:
Exhibit A: Licensed Patents
Exhibit B: Licensed Technology
Exhibit C: Material Transfer Agreement
Exhibit D: Development Plan
Exhibit E: Development Report
Exhibit F: ULRF Royalty Report
18
Exhibit 10.3
* INDICATES A PORTION OF THIS EXHIBIT THAT WAS OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. THIS EXHIBIT INCLUDING SUCH OMITTED INFORMATION WAS
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION ON A CONFIDENTIAL
BASIS.
University of Louisville Research Foundation
Sponsored Research Agreement
THIS AGREEMENT made and effective as of the last date of signature below
("Effective Date"), by and between the University of Louisville Research
Foundation, Inc. (hereinafter "ULRF") a Kentucky non-profit corporation having
an office at MedCenter One, 501 E. Broadway, Suite 200, Louisville, KY
40202-1798 as the agent of the University of Louisville (hereinafter "UofL") for
receiving grants and research agreements from external funding sources and which
owns and controls intellectual property on behalf of UofL (collectively
"Institution") and NeoStem, Inc. with a principal place of business at 420
Lexington Avenue, Suite 450, New York, NY 10170 (hereinafter "SPONSOR").
WHEREAS, the research program contemplated by this Agreement is of mutual
interest and benefit to the ULRF and SPONSOR and will further the instructional,
research and public service objectives of the UofL in a manner consistent with
its status as a non-profit, tax-exempt, educational institution; and
WHEREAS, SPONSOR desires to provide research funding in support of the research
program in return for receiving certain rights in the research results.
NOW, THEREFORE, the parties hereto agree as follows:
1. DEFINITIONS
As used herein, the following terms shall have the following meanings:
1.1 "Principal Investigator" shall mean the investigator under whose
supervision the Research is performed and shall mean Dr. Mariusz Ratajczak,
Department of Medicine, Division of Hematology/Oncology.
1.2 "Research Period" commences with the date after the Effective Date of this
Agreement on which (i) all Approvals (as defined in Section 2.1) are
obtained, and (ii) the Principal Investigator has received the specimens
needed for the conduct of the Research, and continuing for two and one-half
years thereafter.
1.3 "Research" shall mean the description of the research in the Research Plan
which is attached hereto as Appendix "A" and hereby made a part of this
Agreement. Appendix A describes a collaborative effort between SPONSOR and
Institution, with specified portions of Institution's Research contingent
upon SPONSOR's activities.
1.4 "ULRF Intellectual Property" shall mean individually and collectively all
inventions, improvements, modifications and/or discoveries which are
conceived, invented, authored and/or first reduced to practice by one or
more employees of UofL in performance of the Research, and all United
States and foreign patent and copyright applications which may be filed at
any time thereon. ULRF Intellectual Property shall not include "Traditional
Works" as defined in Section 1.g. of Institution's Intellectual Property
Policy (http://louisville.edu/thinker/for-faculty-and-staff/ip-policy.html)
not specifically commissioned by Institution.
1.5 "JOINT Intellectual Property" shall mean individually and collectively all
inventions, improvements, modifications and/or discoveries which are
conceived, invented, authored and/or first reduced to practice jointly by
one or more employees of UofL and by one or more employees, consultants or
advisors of SPONSOR in performance of the Research, and all United States
and foreign patent and copyright applications which may be filed at any
time thereon. JOINT Intellectual Property shall not include "Traditional
Works" as defined in Section 1.g. of Institution's Intellectual Property
Policy (http://louisville.edu/thinker/for-faculty-and-staff/ip-policy.html)
not specifically commissioned by Institution.
Page 1
2. RESEARCH
2.1 ULRF and SPONSOR have executed this Agreement prior to all approvals
("Approvals") required by Institution and/or Federal regulation (e.g.
Institutional Review Board ("IRB") approval if human subjects are involved
in the Research, Institutional Animal Care and Use Committee ("IACUC")
approval for use of live vertebrate animals in the Research) having been
obtained for the Research described in Appendix A. Sponsor, Principal
Investigator and Institution, as applicable, shall cooperate in preparing
and fiing these documents, as applicable. ULRF shall commence the
performance of its activities as set forth in Appendix A promptly after the
start date of the Research Period as set forth in Section 1.2 above. ULRF
and/or SPONSOR, as applicable, shall use its best reasonable efforts to
obtain the Approvals promptly after the Effective Date of the Agreement.
ULRF shall use reasonable best efforts to perform the Research
substantially in accordance with the terms and conditions of this
Agreement, subject to SPONSOR's performance of the activities assigned to
it under Appendix A. Specimens from human subjects shall initially be
provided to ULRF for the Research by Sponsor; provided that in the event
the specimens are to be collected by the James Graham Brown Cancer Center
of University Hospital located in Louisville, Kentucky, for use in the
Research, then this Agreement shall be amended as appropriate in order to
reflect such arrangement.
2.2 SPONSOR will obtain the informed written consent and separate authorization
under HIPAA of each human subject from which a specimen is collected by
SPONSOR for the purpose of the Research such that collection and use of
Protected Health Information ("PHI") shall comply with all United States
and international privacy laws, regulations, rules, opinions or other
governmental and/or self-regulatory group requirements or statements of
position currently existing or later enacted during the term of this
Agreement. SPONSOR shall not provide any PHI to Institution or the
Principal Investigator.
2.3 If for any reason the Principal Investigator becomes unable to continue the
Research, and a successor acceptable to both parties is not available, ULRF
and/or SPONSOR shall have the option to terminate this Agreement pursuant
to Section 10 hereof.
2.4 If the nature of the Research is such that Institution and/or SPONSOR is
required to have approval of a review committee(s) (e.g. conflict of
interest, IRB, IACUC), Principal Investigator or SPONSOR investigator(s),
as appropriate, shall prepare and file the applicable protocol/outline of
work, and/or other required information and documents with the appropriate
review committee(s), including any (re)submissions to such review
committee(s) subsequently made necessary due to revision of Appendix A by
the parties.
2.5 Both parties acknowledge that each reserves the right to terminate this
Agreement and the Research if the applicable review committee(s) does not
approve or subsequently suspends or withdraws its approval of the specimen
collection protocol or Research.
3. REPORTING
3.1 The Principal Investigator will produce a brief progress report for each
Aim described in Appendix A, outlining the accomplishments and results of
the Research. Both parties agree to meet as may be necessary to discuss
progress of the Research and the results of each Aim and may agree to
modify future efforts based upon progress to date. In addition, Principal
Investigator shall provide written technical reports on the Research to
SPONSOR every six (6) months, and a final written technical report shall be
submitted by the Principal Investigator within sixty (60) days of the
conclusion of the Research Period. ULRF shall maintain records of the use
of the funds provided by SPONSOR and shall make such records available to
SPONSOR upon reasonable notice during regular ULRF business hours, but not
more frequently than once each calendar year.
3.2 Subject to the provisions for (i) non-use and non-disclosure of ULRF's
Confidential Information under Section 5 (CONFIDENTIALITY), (ii) the
prerogative of Research personnel to first publish Research results in
accordance with Section 7 (PUBLICATIONS), and (iii) filing of
application(s) for statutory protection of Intellectual Property prior to
enabling disclosure thereof in accordance with Section 8 (INTELLECTUAL
PROPERTY) herein, SPONSOR may use the information provided in written
technical reports submitted pursuant to this Section 3 and disclose such
information to any third party. Information contained in such written
technical reports which remains subject to the terms and conditions of
Section 5, Section 7, and/or Section 8 herein shall not be disclosed by
SPONSOR except on an "as needed" basis (a) to those parties with whom
SPONSOR has entered into written confidentiality agreements at least as
restrictive as the terms of Section 5 herein, or (b) in a submission to the
United States Food & Drug Administration or a similar foreign agency that
regulates approval of new drugs, provided that SPONSOR gives ULRF sixty
(60) days prior written notice of such disclosure and receives ULRF's prior
written permission, which shall not be unreasonably withheld.
4. PAYMENT OF COSTS
4.1 In consideration of ULRF's performance hereunder, SPONSOR agrees to support
costs incurred in performance of the Research in the amount of Three
Hundred Seventy Five Thousand U.S. Dollars (US$375,000), inclusive of
applicable Facilities & Administrative Costs calculated at Institution's
rate which is in effect as of the Effective Date of this Agreement. Unless
the funding total is subsequently increased by written amendment to this
Agreement made in accordance with Section 17.1, total costs to SPONSOR
shall not exceed said amount. SPONSOR shall make interim payments as set
forth in Appendix A provided this Agreement has not been terminated.
Payment will be due upon SPONSOR's receipt of invoice. Payment by SPONSOR
shall be sent to the address specified on the invoice. Invoices not paid
within thirty (30) days of the later of invoice date or receipt date of
invoice are subject to 1% per month interest on the unpaid balance for any
amounts not in dispute. ULRF reserves the right to discontinue the Research
if SPONSOR fails to make payments within thirty (30) days of the dates
specified in the invoice except for amounts which are in dispute and
subject to a thirty (30) day opportunity to resolve.
4.2 ULRF shall retain title to any equipment purchased with funds provided by
SPONSOR under this Agreement.
4.3 The determination of allowable cost for ULRF's activities will be made in
accordance with the applicable Federal Cost Principle inclusive of all
amendments in effect as of the date of this Agreement, and any subsequent
amendments: Institutions of Higher Education (OMB Circular A-21).
4.4 In the event of termination of this Agreement pursuant to Section 10,
SPONSOR shall reimburse ULRF for all costs incurred and non-cancelable
obligations made up to and including the effective date of such notice of
termination; provided, the total funding provided by SPONSOR to ULRF
hereunder shall not exceed the total funding amount set forth in Section
4.1.
5. CONFIDENTIALITY
5.1 In performance of the Research, either party may disclose information to
the other party which it considers to be proprietary and confidential
(hereinafter Confidential Information). All such information shall be
designated confidential at the time of disclosure by the disclosing party
either orally or in writing. If designated confidential orally, the
disclosing party shall within thirty (30) days of the date of disclosure
confirm in writing the confidential nature of such information. The
receiving party shall use reasonable efforts to ensure said Confidential
Information is kept confidential and shall promptly return or destroy all
originals and copies of Confidential Information at the written request of
the disclosing party. Except as otherwise provided herein, for a period of
five (5) years following the date of such disclosure, the receiving party
will not disclose the Confidential Information without the consent of the
disclosing party and shall use such Confidential Information only for the
purposes of this Agreement. Notwithstanding the foregoing, the receiving
party may transfer the disclosing party's Confidential Information to those
of receiving party's employees, students, officers, directors and agents as
may be reasonably necessary to carry out the performance of this Agreement.
Information shall not be subject to the aforementioned restrictions where
the:
(a) information was possessed by receiving party prior to receipt from
disclosing party other than through prior disclosure by the disclosing
party as evidenced by receiving party's business records;
(b) information published or available to the general public otherwise
than through a breach of this Agreement;
(c) information obtained by receiving party from a third party with a
valid right to disclose it, provided that said third party is not
under a confidentiality obligation to the disclosing party;
(d) information was independently developed by employees, agents or
consultants of receiving party who had no knowledge of or access to
the information as evidenced by receiving party's business records;
(e) information for which the receiving party obtains the disclosing
party's prior written permission to publish or which is disclosed in
the necessary course of the prosecution of patent applications upon
intellectual property developed pursuant to this Agreement; or
(f) information required to be disclosed by operation of law, regulation,
Attorney General decisions that carry the force of law, or court
order.
6. PUBLICITY
6.1 SPONSOR will not use the name of the ULRF, UofL, nor of any employee,
student, trustee or officer thereof, in advertising or publicity, including
news releases, without the prior written consent of the ULRF, which shall
not be unreasonably withheld; and ULRF will not use the name of the
SPONSOR, nor any employee of SPONSOR, in any advertising or publicity,
including news releases, without the prior written approval of SPONSOR,
which shall not be unreasonably withheld.
6.2 Nothwithstanding anything to the contrary in this Agreement, (i) the ULRF
may disclose the identity of the SPONSOR, the title of the Research, the
name of the Investigator, the Contract Period, and the amount being paid by
the SPONSOR for the Research, and (ii) the SPONSOR may disclose such
information as required by law or regulation.
7. PUBLICATIONS
7.1 SPONSOR recognizes that under UofL policies, the results of the Research
must be publishable and agrees that UofL and UofL investigators have the
right to publish and otherwise publicly disclose any information gained in
the course of the Research; provided, SPONSOR retains the right to preclude
publication or other public disclosure of SPONSOR's Confidential
Information. In order to permit SPONSOR an opportunity to determine if
patentable inventions or SPONSOR's Confidential Information are disclosed
therein, the Principal Investigator will provide SPONSOR with copies of any
proposed publication or presentation by project investigators no less than
thirty (30) days prior to submission for publication. Whenever possible,
efforts will be made by the Principal Investigator to provide copies of
drafts of intended articles or abstracts as soon as they reach a stage
suitable for distribution. SPONSOR shall have thirty (30) days after
receipt of said copies to object to such proposed presentation or proposed
publication because there is patentable subject matter which needs
protection and/or discloses SPONSOR's Confidential Information. In the
event that SPONSOR makes an objection because its Confidential Information
is disclosed in the proposed presentation or publication, such Confidential
Information will be deleted from the proposed presentation or publication
by the Principal Investigator and other Research personnel before
proceeding with publication or presentation. In the event that SPONSOR
makes an objection because potentially patentable subject matter is
disclosed in the proposed publication or presentation, the Principal
Investigator and other project investigators shall refrain from making such
publication or presentation for a reasonable time, not to exceed three (3)
months from the date of receipt of such objection, in order for the ULRF or
SPONSOR to file a patent application(s) directed to the patentable subject
matter contained in the proposed publication or presentation, in accordance
with Article 8 (INTELLECTUAL PROPERTY) below.
8. INTELLECTUAL PROPERTY
8.1 For the purposes of this Section 8, right and title to any intellectual
property, whether patented, copyrighted or maintained as know-how, shall be
determined in accordance with the provisions for determining authorship and
inventorship under Titles 17 and 35 of the United States Code,
respectively.
8.2 All rights and title to ULRF Intellectual Property shall belong to the ULRF
and shall be subject to the terms and conditions of this Agreement.
8.3 All rights and title to JOINT Intellectual Property shall jointly belong to
ULRF and SPONSOR, and shall be subject to the terms and conditions of this
Agreement.
8.4 ULRF will promptly notify SPONSOR of any ULRF Intellectual Property or
JOINT Intellectual Property and will supply SPONSOR with a copy of any
invention disclosure received from the Principal Investigator describing
said ULRF Intellectual Property or JOINT Intellectual Property. Likewise,
SPONSOR will promptly notify ULRF of any ULRF Intellectual Property or
JOINT Intellectual Property and will supply ULRF with a copy of any
invention disclosure thereon received from SPONSOR employee(s) describing
said ULRF Intellectual Property or JOINT Intellectual Property. SPONSOR
shall have thirty (30) days from the date of disclosure to decide whether a
patent application or application for other intellectual property
protection should be sought. If SPONSOR decides that a patent application
or application for other intellectual property protection should be filed
on ULRF Intellectual Property, the ULRF shall promptly prepare, file and
prosecute such U.S. and foreign application(s) in ULRF's name. If SPONSOR
decides that a patent application or application for other intellectual
property protection should be filed on JOINT Intellectual Property, then
SPONSOR shall direct ULRF to promptly prepare, file and prosecute such U.S.
and foreign application(s) in ULRF and SPONSOR's name. SPONSOR shall bear
all costs incurred in connection with such preparation, filing, prosecution
and maintenance of U.S. and foreign applications directed to said ULRF
Intellectual Property or JOINT Intellectual Property but may elect to
discontinue its financial support of such prosecution and/or maintenance,
provided, SPONSOR notifies ULRF in writing of such decision to discontinue
reasonably in advance of ULRF's need to respond to any statutory deadlines
of which SPONSOR has been made aware. SPONSOR and ULRF shall ensure that
such application(s) to the best of their knowledge, cover all items of
commercial interest and significance. With regard to all applications for
which SPONSOR is reimbursing ULRF for or directly paying the patent-related
expenses, SPONSOR shall be given reasonable opportunity to review and
contribute to the content of said ULRF Intellectual Property application(s)
being managed by ULRF. ULRF shall keep SPONSOR advised as to all
developments with regard to said application(s) and shall promptly provide
to SPONSOR copies of all documents received and/or filed in connection with
the filing, prosecution or maintenance thereof in reasonable time, subject
to statutory deadlines, for the SPONSOR to comment and contribute thereto.
Following execution of an exclusive license to ULRF Intellectual Property
or JOINT Intellectual Property, then prosecution responsibility of all
licensed ULRF Intellectual Property or JOINT Intellectual Property shall be
governed by the terms of such license, which shall be no less favorable to
Sponsor than the terms set forth in the license being entered into
concurrently with this Agreement.
8.5 If the SPONSOR elects not to support the filing of a patent application or
other intellectual property protection for any ULRF Intellectual Property
or Joint Intellectual Property disclosed to the SPONSOR or decides to
discontinue the financial support of the prosecution or maintenance of any
applications, ULRF shall have no further obligation to SPONSOR under this
Agreement with regard to such applications and the subject ULRF
Intellectual Property or JOINT Intellectual Property, and ULRF shall be
free to file or continue prosecution or maintain any such application(s),
and to maintain any issued patents thereon in the U.S. and any foreign
country at ULRF's expense. Such patent applications and issued patents
shall be excluded from SPONSOR's option under Section 9 hereof, however,
SPONSOR shall retain all of its own rights in Joint Intellectual Property.
9. GRANT OF RIGHTS
9.1 ULRF grants the SPONSOR the first option, at the SPONSOR's sole election,
to negotiate for an exclusive, worldwide commercial license to ULRF's
interest in any ULRF Intellectual Property or JOINT Intellectual Property.
Such license shall be for fair and valuable consideration and shall include
a reasonable royalty rate and, subject to ULRF's policies, shall include
other such terms as are typical in licenses of similar technology from
not-for-profit organizations to for-profit organizations. The option shall
extend for an option time period of * from the date of disclosure of the
ULRF Intellectual Property or JOINT Intellectual Property to SPONSOR.
9.2 If SPONSOR elects not to exercise its option pursuant to this Section or
fails to negotiate a license agreement to ULRF Intellectual Property or
Joint Intellectual Property during said * option period, then:
(a) ULRF shall have no further obligation and SPONSOR shall have no
further right to ULRF Intellectual Property and ULRF may license its
interest in ULRF Intellectual Property to any party upon terms ULRF
deems appropriate;
(b) SPONSOR shall pay to ULRF a royalty on any product that is covered by
JOINT Intellectual Property, such rate to be determined during the
option time period, or, if the parties fail to arrive at an agreement
on this point, shall be set at * the rate of the relevant industry
standard;
(c) ULRF and SPONSOR each shall be free to exploit the JOINT Intellectual
Property as it wishes, whether directly and/or through licensing under
its ownership interests to any third party(ies). ULRF and SPONSOR each
shall fully account to the other for compensation derived from such
exploitation, such accounting to be determined during the option time
period, or, if the parties fail to arrive at an agreement on this
point, shall be with * of the compensation to the licensing party and
* to the non-licensing party.
9.3 Any license granted to SPONSOR by ULRF shall be subject, if applicable, to
the rights of the United States government reserved under Public Laws
96-517, 97-256 and 98-620, codified at 35 U.S.C. 200-212, and any
regulations issued thereunder, and shall include a perpetual, paid-up,
royalty-free, non-exclusive license in favor of the ULRF and the Principal
Investigator(s) to use the inventions and/or discoveries for noncommercial,
educational and research purposes, including authorizing other entities to
use such ULRF Intellectual Property and JOINT Intellectual Property for
academic and non-commercial research purposes. For ULRF Intellectual
Property and JOINT Intellectual Property subject to SPONSOR's exclusive
option period as specified in Section 9.1 or to a subsequently executed
exclusive commercial license agreement between ULRF and SPONSOR, ULRF shall
notify SPONSOR of each other entity's use of such ULRF Intellectual
Property or JOINT Intellectual Property and include appropriate
restrictions (e.g., prohibit the third party from transferring the subject
ULRF Intellectual Property or JOINT Intellectual Property to any third
party, prohibit use of the subject ULRF Intellectual Property or JOINT
Intellectual Property by the third party for any commercial purposes) in
any such grant of research use rights to third parties. Unless restricted
during the term of SPONSOR's exclusive option period specified in Section
9.1 or unless subject to a subsequently executed exclusive commercial
license agreement between ULRF and SPONSOR, ULRF also reserves the right to
use ULRF Intellectual Property and JOINT Intellectual Property for any
purpose, including licensing ULRF Intellectual Property and JOINT
Intellectual Property to third parties, without any further obligation to
SPONSOR except as otherwise set forth herein (so long as such use does not
disclose SPONSOR Confidential Information).
10. TERMINATION
10.1 This Agreement shall become effective upon the date first hereinabove
written and shall continue in effect for the full duration of the Research
Period unless sooner terminated pursuant to this Section. Sponsor may
terminate this agreement upon ninety (90) days prior written notice to
ULRF.
10.2 In the event that either party hereto shall commit any breach of or default
in any of the terms or conditions of this Agreement, and also shall fail to
remedy such default or breach within thirty (30) days after receipt of
written notice thereof from the other party hereto, the party giving notice
may, at its option and in addition to any other remedies which it may have
at law or in equity, terminate this Agreement by sending notice of
termination in writing to the other party to such effect and such
termination shall be effective as of the date of receipt of such notice.
10.3 Termination of this agreement by either party for any reason shall not
affect the rights and obligations of the parties accrued prior to the
effective date of termination of this Agreement. No termination of this
Agreement, however effectuated, shall release either party from their
rights and obligations under Sections 5, 6, 7, 8 and 11.
11. INDEPENDENT PARTIES
11.1 For the purposes of this Agreement, the parties shall be independent
contractors. Nothing contained herein shall be deemed or construed to
create between the parties hereto a partnership or joint venture or the
relationship of agent and principal.
12. DISCLAIMER OF WARRANTIES, INDEMNIFICATION
12.1 ULRF makes no warranties, express or implied, as to any matter whatsoever,
including without limitation, warranties with respect to the conduct,
completion, success or particular results of the Research, or the
condition, ownership, merchantability, or fitness for a particular purpose
of the Research or any ULRF Intellectual Property or JOINT Intellectual
Property. ULRF shall not be liable for any direct, indirect, consequential,
punitive or other damages suffered by SPONSOR or any other person resulting
from the Research or use of the results of the Research or any ULRF
Intellectual Property or JOINT Intellectual Property.
12.2 SPONSOR shall defend, indemnify and hold harmless ULRF, UofL, the Principal
Investigator and any of ULRF or UofL's faculty, students, employees,
trustees, officers, affiliates and agents and their respective successors,
heirs and assigns (hereinafter referred to collectively as the " ULRF
Indemnified Persons") from and against any and all liability, claims,
lawsuits, losses, damages, costs or expenses (including attorney's fees)
(collectively "Losses") which the ULRF Indemnified Persons may hereafter
incur, or be required to pay as a result of SPONSOR's use of the results of
the Research or any ULRF Intellectual Property or Joint Intellectual
Property or any act or omission of SPONSOR, its employees, affiliates,
contractors, licensees or agents. Nothwithstanding the foregoing, SPONSOR's
indemnification obligations under this Section shall not apply to any
Losses to the extent such Losses are attributable to the gross negligence
or willful misconduct of any of the ULRF Indemnified Persons. ULRF shall
notify SPONSOR upon learning of the institution or threatened institution
of any such liability, claims, lawsuits, losses, damages, costs and
expenses.
12.3 SPONSOR hereby assumes any risks of personal injury and property damage
attributable to the negligent acts or omissions of SPONSOR in the
performance of the Research and SPONSOR's officers, employees, and agents
thereof. To the extent permitted by applicable law and its insurance
coverage, ULRF hereby assumes any risks of personal injury and property
damage attributable to the negligent acts or omissions of ULRF in the
performance of the Research and ULRF's officers, employees and agents
thereof.
13. ASSIGNMENT
13.1 This Agreement may not be assigned or delegated, in whole or in part, by
SPONSOR or ULRF without the prior written consent of the other party, which
shall not be unreasonably withheld. A change in control shall not be
considered an assignment for purposes of this Section 13.1 unless such
change in control causes SPONSOR or its Affiliates to engage in any morally
objectionable activities including: activities designed to defame,
embarrass, harm, abuse, threaten, slander or harass third parties;
activities prohibited by the laws of the United States and/or foreign
territories in which SPONSOR conducts business; activities designed to
encourage unlawful behavior by others, such as hate crimes, terrorism and
child pornography; activities that are tortuous, vulgar, obscene, invasive
of the privacy of a third party, racially, ethnically, or otherwise
objectionable; activities designed to harm minors in any way. Any attempted
assignment in violation of this Section 13.1 shall be void and of no
effect. "Affiliate" shall mean any corporation or other legal entity which
directly or indirectly controls, is controlled by, or is under common
control with SPONSOR as of the Effective Date of this Agreement. For the
purpose of this Agreement, "control" shall mean the direct or indirect
ownership of greater than fifty percent (50%) of the outstanding shares on
a fully diluted basis or other voting rights of the subject entity to elect
directors, or if not meeting the preceding, any entity owned or controlled
by or owning or controlling at the maximum control or ownership right
permitted in the country where such entity exists. For clarity, a party's
status as an Affiliate of SPONSOR shall terminate if and when such control
ceases to exist.
14. GOVERNING LAW
14.1 This Agreement shall be governed and construed in accordance with the laws
of the Commonwealth of Kentucky without giving effect to the conflict of
laws provisions.
15. NOTICES
15.1 Notices, invoices, communications and payments hereunder shall be deemed
made if given in writing and addressed to the party to receive such notice,
invoice, communication or payment at the address given below, or such other
address as may hereafter be designated by notice in writing. Notices shall
be delivered by certified or registered first class mail (airmail if not
domestic) or by commercial courier service, and shall be deemed to have
been given or made (a) when delivered personally; (b) when sent by
confirmed facsimile; (c) three (3) days after having been sent by
registered or certified mail, return receipt requested, postage prepaid; or
(d) two (2) days after deposit with a commercial overnight carrier with
confirmed verification of receipt.. All communications will be sent to the
addresses set forth below or to such other address as may be designated by
a party by giving written notice to the other party pursuant to this
Section.
If to SPONSOR:
NeoStem, Inc.
420 Lexington Avenue
Suite 450
New York, NY 10170
Attention: General Counsel
If to ULRF:
For administrative notice:
Director, Office of Industry Contracts
University of Louisville Research Foundation, Inc.
MedCenter One, Suite 200
501 East Broadway
Louisville, KY 40202-1798
For technical notice: For U.S. Postal Service:
Dr. Mariusz Ratajcak
Dept. of Medicine-Oncology
University of Louisville
Louisville, KY 40292
16. ADDITIONAL PROVISIONS
16.1 In the event any part, article, section, subsection, clause, paragraph or
subparagraph of this Agreement shall be held to be indefinite, invalid,
illegal or otherwise voidable or unenforceable, the entire Agreement shall
not fail on account thereof, and the balance of the Agreement shall
continue in full force and effect.
16.2 A waiver by either party of a breach or violation of any provision of this
Agreement will not constitute or be construed as a waiver of any subsequent
breach or violation of that provision or as a waiver of any breach or
violation of any other provision of this Agreement.
16.3 No exercise of a specific right or remedy by any party precludes it from or
prejudices it in exercising another remedy or maintaining an action to
which it may otherwise be entitled either at law or in equity.
16.4 During the performance of this Agreement, SPONSOR and ULRF shall not
discriminate against any employee or applicant for employment because of
race, color, sex, sexual preference, age, religion, national or ethnic
origin, handicap, or because he or she is a disabled veteran or veteran of
the Vietnam era.
16.5 Each party shall comply with all laws, regulations and other legal
requirements applicable to them in connection with this Agreement.
17. AGREEMENT MODIFICATION
17.1 This Agreement is the final and complete understanding of the parties with
respect to the subject matter hereof superseding all prior agreements,
understandings and discussions relating thereto. No amendments or changes
to this Agreement including, without limitation, changes to the field of
Research, total cost or Research Period, shall be valid unless the change
is made in writing and signed by authorized representatives of the parties
hereto. The appendices will be binding upon the parties hereto except to
the extent they may conflict with the terms and conditions contained within
this Agreement, in which case the terms and conditions of the Agreement
will govern.
[remainder of page left blank intentionally]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
THE UNIVERSITY OF LOUISVILLE NEOSTEM, INC.
RESEARCH FOUNDATION, INC.
Signature: /s/ David King Signature: /s/ Robin Smith
Printed Name: David D. King Printed Name: Robin Smith
------------- -----------
Title: Director, Office of Industry Contracts Title: Chairman and CEO
-------------------------------------- ----------------
Date: November 12, 2007 Date: November 13, 2007
----------------- -----------------
Principal Investigator, while not a party to this
Agreement, by his/her signature acknowledges that
he/she: (1) has read and agrees to abide by the terms
and conditions that apply to the Principal Investigator,
(2) agrees to conduct/perform the research as outlined
in the Research Statement of Work, and (3) if applicable,
will see that the work within the scope of this agreement
is performed in accordance with an approved University/
Institution management plan.(1)
Name: Mariusz Z. Ratajczak, M.D., Ph.D.
---------------------------------
Signature: /s/ Mariusz Ratajczak
Title: Professor, Medical Oncology
---------------------------
Date: November 12, 2007
-----------------
- ---------------
(1) "Management Plan" means a written plan for the management, reduction or
elimination of a potential financial conflict of interest relating to
research. It relies upon, and is therefore limited by, good faith
disclosures about significant financial interests made, and other
information provided by, a covered individual to the University.