Exhibit 10.63


 


RESEARCH COLLABORATION AGREEMENT


— INVENTIONS AND MATERIALS —


 


This
Agreement, effective as of September 21, 2005 (the “Effective Date”), is
between the University of Massachusetts Lowell (“UML” or “Institution”), a
public institution of higher education of the Commonwealth of Massachusetts,
and MFIC Corporation, a Delaware corporation (“Sponsor”),


 


WHEREAS: UML has identified Sponsor’s proprietary
Microfluidizer® processor and Microfluidizer® Mixer/Reactor technology as a
potentially important sizing and reaction process component to its
nanomanufacturing initiative,


 


WHEREAS: UML desires to evaluate this premise via
research and development using Microfluidizer equipment,


 


WHEREAS: MIFC desires to evaluate their Microfluidizer®
materials processor and Microfluidizer® Mixer/Reactor technologies for
nanomanufacturing opportunities,


 


THEN:  Institution and Sponsor hereby agree to this
Research Collaboration Agreement as defined by the following terms:


 


1.     Definitions.


 


1.1.       “Confidential Information” means confidential or proprietary
information furnished by one party (the “Disclosing Party”) to the other party
(the “Receiving Party”) in connection with the performance of the Research
Project, provided that the information is specifically designated as
confidential. Confidential Information includes, without limitation, trade
secrets, know-how, inventions, technical data or specifications, testing
methods, and research and development activities.1.2.  “Indemnitees” means either Institution
and its trustees, officers, faculty, students, employees, and agents and their
respective successors, heirs and assigns of Sponsor and its directors,
officers, employees, and agents and their respective successors, heirs and
assigns.


 


1.3.       “Inventions” means any potentially patentable or copyrightable
innovation based on the Research Results, which is conceived during the term of
this Agreement by employees of Institution or Sponsor.


 


1.4.       “Materials” means any tangible materials, including recorded data,
writings, etc.


 


1.5.       “Patent Rights” means all United States and foreign patent
applications claiming an Invention, including any divisional, continuation,
continuation-in-part (to the extent that the


 

















 


claims are directed to an Invention), and foreign
equivalents thereof, as well as any patents issued thereon or reissues or
reexaminations thereof. “Institution Patent Rights” means Patent Rights
claiming Inventions that are conceived or reduced to practice solely by
employees of Institution or by employees of Sponsor utilizing Institution facilities,
as determined under the patent laws of the United States, and assigned to
Institution. “Joint Patent Rights” means Patent Rights claiming
Inventions that are conceived or reduced to practice jointly by employees of Institution
and employees of Sponsor, as determined under the patent laws of the United
States, and assigned to institution or Sponsor.


 


1.6.       “Principal Investigator” means an employee of Institution who has
primary responsibility for the performance of the Research Project. The
Principal Investigator is identified in Section 2.1 below.


 


1.7.       “Proprietary Materials” means any proprietary Materials other than
Project Materials that are furnished by one party (the “Supplier”) to the other
party (the “Recipient”) in connection with performance of the Research Project.


 


1.8.       “Research Project” means the activities described on Exhibit A
(“Description of Research Project”), which Institution agrees to perform under
the terms and conditions of this Agreement.


 


1.9.       “Research Results” means all data, test results, laboratory notes,
techniques, know-how, and any other information obtained in the performance of
the Research Project. The term “Research Results” does not include Project
Materials, patentable inventions, copyrighted or copyrightable works,
trademarks or service marks, or other intellectual property based on the
Research Results. As a matter of policy, Institution ordinarily will not assert
trade secret protection for Research Results.


 


1.10.     “Technical Representative” means an individual designated by
Sponsor as its principal contact for consultation and communications with
Institution and the Principal Investigator. The Technical Representative is
identified in Section 2.1 below.


 


2.     Performance of Research Project.


 


2.1.       Principal Investigator and Technical Representative. Dr. Robert Nicolosi, who shall serve as
the Project Manager, will have overall responsibility for the Research Project
and will be one of the three faculty representatives that serve on the Advisory
Committee. The Principal Investigator shall be Dr. Julie Chen, Director –
UML Nanomanufacturing Center. She will manage the interaction required to
identify specific research initiatives recommended by the Advisory Committee to
be set up under this agreement. This Advisory Committee will be composed of Dr. Chen,
Dr. Nicolosi and one other faculty representative and two Technical
Representatives of Sponsor. When
a project is identified, Dr. Chen will recommend a specific Principal
Investigator for that project. If Dr. Chen ceases to serve as Principal
Investigator for any reason, Institution will promptly notify Sponsor and
Institution and Sponsor shall use good faith efforts to identify a mutually
acceptable replacement within sixty (60) days. If a suitable replacement
Principal Investigator cannot be identified within the sixty-day period,
Sponsor may


 

















 


terminate this Agreement as provided in Section 6.2.
The Sponsor may change its Technical Representative upon thirty (30) days
written notice to Institution.


 


2.2.       Performance of Research Project. Institution shall use reasonable efforts to complete the Research
Project; however, Institution makes no warranties regarding the completion of
the Research Project or the achievement of any particular results. The
Technical Representative may consult informally with the Principal
Investigator, both in person and by telephone, regarding the performance of the
Research Project. The Institution shall provide the Technical Representative
reasonable access to Institution facilities where the Research Project is being
conducted.


 


2.3        Records, Materials, and Reports. The Project Manager shall prepare and maintain
records containing all Research Results, including laboratory notebooks
maintained in accordance with customary academic practice. During the term of
this Agreement, at his/her convenience, the Principal Investigator shall
provide the Technical Representative reasonable access to research records, and
the Project Manager shall furnish Sponsor, upon request, reasonable amounts of
any Project Materials, subject to availability. Within ninety (90) days after
the expiration or termination of this Agreement, the Principal Investigator
shall deliver to sponsor a final report describing all significant Research
Results in reasonable detail. However, the Principal Investigator may extend
this ninety-day deadline for a period of up to an additional thirty (30) days
with the consent of Sponsor, which consent shall not be unreasonably withheld.


 


3.     Responsibilities of Sponsor.


 


3.1.       Contributions to Research Project. Sponsor shall contribute to the Research Project the support,
equipment, personnel, technology, and other resources listed on Exhibit B
(“Sponsor Contributions”). Sponsor may also furnish Institution and the
Principal Investigator with certain Confidential Information or Proprietary
Materials, which shall remain the property of Sponsor. Institution and the
Principal Investigator reserve the right to refuse to accept any Confidential
Information or Proprietary Materials offered by Sponsor. Exhibit C
(“Sponsor Value Contribution to the Research Collaboration Agreement”) provides
an estimated value of $545,000 as Sponsor’s contribution to this collaboration.


 


3.2.       Consideration to Institution. The primary consideration is related to access to the Microfluidizer
technologies for purposes of evaluation in UML’s Nanomanufacturing program
directed towards new product applications and formulations.


 


In
addition, for each project approved by the Advisory Committee, MFIC will
bear the first $3,000 for each discrete project. Any additional monies required
for the project will be provided by UML if the monies are available. A Project will proceed only if the Scope of
Work, appropriate joint UML and MFIC personnel, a budget, and funds are
available.


 


4.     Confidential Information: Proprietary Materials:
Publications.


 


4.1.       Confidential information.


 


(a)     Designation. Confidential
Information that is disclosed in writing shall be marked with a legend (such
as, “Confidential” or “Proprietary”), indicating its


 

















 


confidential status. Confidential Information
that is disclosed orally or visually shall be designated as such at the time of
its disclosure and shall be documented in a written notice prepared by the
Disclosing Party and delivered as soon as possible to the Receiving Party but
at latest within thirty (30) days of the date of
disclosure; the notice shall summarize the Confidential Information disclosed
to the Receiving Party and reference the time and place of disclosure.


 


(b)     Obligations. During the
term of this Agreement and thereafter for a period of five (5) years, the
Receiving Party shall (i) maintain all Confidential Information in
confidence, except that the Receiving Party may disclose or permit the
disclosure of Confidential Information to its directors, officers, employees,
consultants, and advisors who are obligated to maintain the confidential nature
of Confidential Information and who need to know Confidential Information for
the performance of the Research Project; (ii) use all Confidential
Information solely for the performance or furtherance of the Research Project;
and (iii) allow its directors, officers, employees, consultants, and
advisors to reproduce the Confidential Information only to the extent necessary
for performance of the Research Project, with all reproductions being
considered Confidential Information.


 


(c)     Exceptions. The obligations of the Receiving Party under Section 4.1.(b) above
do not apply to the extent that the Receiving Party can demonstrate that
Confidential Information (i) was in the public domain prior to the time of
its disclosure under this Agreement; however this exception shall not apply to any specific information merely
because it is included in more general non-confidential information, nor to any
specific combination of information merely because individual elements, but not
the combination, are included in non-confidential information, (ii) entered the public domain after the
time of its disclosure under this Agreement through means other than an
unauthorized disclosure resulting from an act or omission by the Receiving
Party; (iii) was independently developed or discovered by the Receiving Party
without use of the Confidential Information, (iv) is or was disclosed to
the Receiving Party at any time by a third party having no fiduciary
relationship with the Disclosing Party and having no obligation of
confidentiality with respect to the Confidential Information; or (v) is,
in the opinion of legal counsel to the Receiving Party required to be disclosed
to comply with applicable laws or regulations, or with a court or
administrative order, provided that the Disclosing Party receives reasonable prior
written notice of that disclosure in order to afford the Disclosing Party the opportunity, at election and expense of the Disclosing Party, to respond to such
request and /or to attempt to block such disclosure. Further, if such
disclosure is compelled the Receiving Party
shall disclose only the minimum of the Confidential Information that is
required to be disclosed to comply with such order, law or regulation.


 


(d)     Ownership and Return. The
Receiving Party acknowledges that the Disclosing Party (or any third party
entrusting its own information to the Disclosing Party) owns its Confidential
Information in the possession of the Receiving Party. Upon the expiration or
termination of this Agreement or at the request of the Disclosing Party, the
Receiving party shall return to the Disclosing Party all originals, copies, and
summaries of documents, materials, and other tangible manifestations of
Confidential Information in


 

















 


the possession or control of the
Receiving Party, except that the Receiving Party may retain one (1) copy
of the Confidential Information in the possession of its legal counsel solely
for the purpose of monitoring its obligations under this Agreement.


 


4.2.       Proprietary Materials.


 


(a)     Limited Use and Transfer.
The Recipient shall use Proprietary Materials only for the performance of the
Research Project. The Recipient shall use the Proprietary Materials only in
compliance with all applicable federal, state, and local laws and regulations.
The Recipient shall not use the Proprietary Materials in any in vivo experiments
on human subjects. The Recipient shall not transfer any Proprietary Materials
to any third party without the prior written consent of the Supplier.


 


(b)     Warranty Disclaimer. THE
SUPPLIER MAKES NO REPRESENTATIONS, AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, WITH
RESPECT TO PROPRIETARY MATERIALS. THERE ARE NO
EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE, OR THAT THE USE OF PROPRIETARY MATERIALS WILL NOT INFRINGE ANY PATENT
RIGHTS OR OTHER PROPRIETARY RIGHTS OF A THIRD PARTY.


 


(c)     The Recipient acknowledges that the Supplier (or any third party
entrusting its Materials to the Supplier) claims ownership of its Proprietary
Materials in the possession of the Recipient. The Recipient agrees to cause its
employees to execute and deliver any documents of assignment or conveyance to
effectuate the ownership rights of the Supplier in Proprietary Materials. Upon
the expiration or termination of this Agreement, the Recipient shall at the
instruction of Supplier either destroy or return any unused Proprietary Materials.


 


4.3.       Publications. Institution
and its employees may publicly disclose (through journals, lectures, or
otherwise) the Research Results, provided that the Institution shall have
provided a copy of the proposed disclosure to Sponsor at least sixty (60) days
prior to the submission of any written publication and at least thirty (30)
days prior to any oral public disclosure (the “Review Period”) to allow Sponsor
to determine whether any Invention or its Confidential Information would be
disclosed. The parties expressly agree that research grant proposals submitted
to federal, state, or local agencies or non-profit organizations should not be
subject to review under this Section. If Sponsor reasonably determines that the
proposed disclosure would reveal an Invention or Sponsor Confidential
Information, then Sponsor shall notify Institution and the Principal
Investigator of the determination and its basis prior to the expiration of the
Review Period. With respect to disclosure of an Invention, upon receipt of
timely notice by Sponsor, the Institution agrees to delay submission of the
written publication or presentation of the oral public disclosure until one (1) of
the following events occurs: (i) Sponsor and Institution agree that no
patentable Invention exists; (ii) Institution or Sponsor files a patent
application claiming the relevant Invention pursuant to Article 5; (iii) Sponsor
and Institution jointly agree upon deletions that prevent disclosure of any
Invention; or (iv) a period of sixty (60) days elapses commencing with the
effective date of notice to Institution. With respect to disclosure of Sponsor
Confidential


 

















 


Information, upon receipt of timely notice by Sponsor,
the Institution shall use reasonable efforts to cause its employees to delete the
Confidential Information from any proposed disclosure.


 


5.0        Intellectual Property.


 


The parties agree to the following:


 


5.1.       Assignment of Rights in Inventions and Project Materials. Either the Principal Investigator or the
Project Manager, as appropriate, shall assign to Institution all rights in
Inventions and commercial rights in Project Materials. The Principal
Investigator shall certify that every person involved in the Research Project
shall have signed the University Participation Agreement, which assigns to
Institution all rights in Inventions and commercial rights in Project
Materials. Sponsor represents and warrants that all of its employees and
consultants who may be involved in the Research Project shall have agreed
to assign to Sponsor all rights in Inventions and all commercial rights in
Project Materials.


 


5.2.       0wnership of Patent Rights and Project Materials. In accordance with United States patent law,
Institution shall have sole ownership of all Institution Patent Rights and
Institution and Sponsor shall have joint, undivided ownership of all Joint
Patent Rights. Institution shall have sole ownership of commercial rights in
Project Materials not claimed in the Patent Rights; however, if a Project
Material incorporates one or more Sponsor Proprietary Materials, Institution may not
exploit commercial rights in that Project Material without the written consent
of Sponsor.


 


5.3.       Notice of Inventions and Project Materials. The Principal Investigator or the Project
Manager, as appropriate, shall promptly disclose to Institution the conception
or reduction to practice of any Invention and the development or discovery of
any commercially valuable Project Material that is not otherwise disclosed as
an Invention. Institution and Sponsor shall provide prompt written notice to
the other of the internal disclosure by its employees of any Invention.
Institution and Sponsor shall discuss whether to obtain Patent Rights for the
Invention and whether the Patent Rights would constitute Institution Patent Rights
or Joint Patent Rights. Institution shall provide prompt written notice to
Sponsor of the internal disclosure of any commercially valuable Project
Material that is not otherwise disclosed as an Invention.


 


5.4.       Responsibility for Patent Rights.


 


Subject to any Inter-Institutional Patent Management
Agreement resulting from joint inventions, the following procedures will be
followed.


 


(a)     Primary Responsibility with Institution. Institution shall have primary responsibility for the preparation,
filing, prosecution, and maintenance of all Institution Patent Rights, using
patent counsel reasonably acceptable to Sponsor. Institution shall consult with
Sponsor as to the preparation, filing, prosecution and maintenance of Patent
Rights reasonably prior to any deadline or action with the United States Patent &
Trademark Office or any foreign patent office and shall furnish Sponsor with
copies of all relevant documents reasonably in advance of such consultation.


 

















 


(b)     Cooperation. Institution
and Sponsor shall cooperate fully in the preparation, filing, prosecution, and
maintenance of all Institution Patent Rights and Joint Patent Rights.
Cooperation includes, without limitation, (i) promptly executing all
papers and instruments or requiring employees of Institution or Sponsor to
execute papers and instruments as reasonable and appropriate so as to enable
Institution or Sponsor to file, prosecute, and maintain such Patent Rights in
any country; and (ii) promptly informing the other party of matters that may affect
the preparation, filing, prosecution, or maintenance of any such Patent Rights.


 


(c)     Payment of Expenses.
Within thirty (30) days after Institution invoices Sponsor for patent expenses
related to Section 5.5 or from the Inter-Institutional Patent Management
Agreement, Sponsor shall reimburse Institution for all reasonable
patent-related expenses incurred by Institution pursuant to Subsection 5.4(a).
Sponsor may elect, upon sixty (60) days written notice to Institution, to
cease payment of the expenses associated with obtaining or maintaining patent
protection of or one or more Patent Rights in one or more countries. In that
event, Sponsor will lose all rights under this Agreement with respect to Patent
Rights in those countries.


 


5.5.       Option
for Exclusive License. For work funded by the Sponsor, Institution grants
Sponsor a first option to obtain a
worldwide, royalty-bearing, exclusive license (with the right to sublicense)
under its commercial rights in any Institution Patent Rights and Joint Patent
Rights in the Field (the “Option Right”). Sponsor may exercise the Option
Right with respect to a particular Patent Right by written notice to
Institution, which is received by Institution not later than sixty (60) days
after the disclosure to Sponsor of the relevant Invention (the “Option Period”).
If sponsor elects not to exercise the Option Right, or fails to exercise the
Option Right during the Option Period, Institution is free to license its
commercial rights under the relevant Patent Right to any third party. If
Sponsor does elect to exercise the Option Right, Institution and Sponsor shall
negotiate in good faith a license agreement containing commercially reasonable
terms. Institution and Sponsor are unable to reach agreement within six (6) months
after Sponsor exercised the Option Right (the “Negotiation Period”),
Institution may offer its commercial rights in the relevant Patent Right
to any third parties. However, for a period of one (l) year after the
Negotiation Period expires, Institution may only offer those rights to
third parties on terms that are not more favorable than the last offer made by
Institution to Sponsor, unless Institution first provides Sponsor with written
notice of the more favorable offer and Sponsor either (i) declines in
writing to accept the offer or (ii) fails to respond to the offer within
thirty (30) days alter receiving the notice.


 


5.6        Joint Inventions. In the case of joint inventions, the parties
agree to execute an Inter-Institutional Patent Management Agreement using the
University’s Agreement in which the following terms will apply:


 


•           For new product applications in the areas related
to nanoemulsions, nanosuspensions, other formats involving drugs,
nutraceuticals, coatings, etc., the Institution will be named as the patent
manager, will receive a fee of 15% for marketing and licensing these potential
inventions before patent expenses and will distribute to Sponsor 15% of the
revenue, which sum shall paid from the Chancellor’s share.


 

















 


•           For new process improvements in MFZR and MMR
technologies, related to materials, design, etc., the Sponsor will be named as
the patent manager, will receive a fee of 15% for marketing and licensing these
potential inventions before patent expenses and will distribute 5% of the
remaining applicable revenue to the Institution.


 


5.7        Use of Research Results and Project Materials. Each party may use Research Results for any purpose and to use Project Materials for internal research (but not in a commercial product or in connection with a commercial service); provided, however, that in the case of Sponsor, the use does not infringe any claim of a patent application or an issued patent
included in the Institution Patent Rights for which Sponsor has failed to obtain a license as provided in Section 5.5. above. If Sponsor desires to obtain a license under the commercial
rights of Institution in any Project Materials, Institution agrees to discuss the possibility of granting a license, provided that commercial rights are available for licensing when Sponsor makes its request.


 


5.8.       Copyrightable Works. Institution or its employees own any copyrighted or copyrightable works (including reports and publications) that are created by Institution employees in the performance of the Research Project. Institution and the Principal Investigator hereby grant Sponsor an irrevocable, royalty-free, nontransferable, nonexclusive right to copy and distribute any research reports furnished to Sponsor under this Agreement and to prepare, copy, and distribute derivative works based on these research reports.


 


6.          Term and Termination.


 


6.1.       Term. This Agreement commences on the Effective Date and remains in effect for 12 months, unless earlier terminated in accordance with the provisions of this Agreement.


 


6.2.      Loss of Principal Investigator. If either the Principal Investigator or
the Project Manager shall leave Institution or otherwise terminates his or her involvement in the Research Project, and if Institution and Sponsor fail to identity a mutually acceptable substitute as provided in Section 2. 1., Sponsor may terminate this Agreement upon sixty (60) days prior written notice to Institution.


 


6.3.       Termination for Default. If either party commits a material breach of its
obligations under this Agreement and fails to cure that breach within sixty (60) days after
receiving written notice thereof, the other party may terminate this Agreement immediately upon written notice to the party in breach.


 


6.4.      Force Majeure. Neither party will be responsible for delays resulting from causes beyond its reasonable, including without limitation fire, explosion, flood, war, strike, or riot, Provided that the non-performing party uses commercially reasonable efforts to avoid or remove those causes of nonperformance and continues performance under this Agreement with reasonable dispatch whenever the causes are removed.


 

















 


6.5.      Effect of Termination. The following provisions survive the expiration or termination of this Agreement: Articles 1, 4, and 7; Sections 2.3. (obligation to deliver final report), 3.2. (obligation to deliver final accounting), 6.5,8.2. 8.3., 8.5., 8. 14. And 8. 15. In addition, the provisions of Article 5
survive termination of this Agreement, as necessary to effectuate the rights of Sponsor, unless Institution has terminated this Agreement because of a material breach by Sponsor pursuant to Section 6.3.


 


7.          Dispute Resolution.


 


7.1.      Procedures Mandatory. The parties shall resolve disputes arising out of or relating to this Agreement solely by means of the procedures set forth in this Article. These procedures constitute legally binding obligations that are an essential provision of this Agreement.
However, all procedures and deadlines specified in this Article may be modified by written agreement of the parties. If either party fails to observe the procedures of this Article, as modified by their written agreement, the other party may bring an action for specific
performance in any court of competent jurisdiction.


 


7.2.      Dispute Resolution Procedures.


 


(a)     Negotiation. If there is a dispute arising out of or relating to this Agreement, the affected party shall notify the other party, and the parties shall attempt in good faith to resolve the matter within ten (10) days after the date notice is received (the “Notice Date”). Any disputes not resolved by good faith discussions shall be referred to senior executives of each party, who shall meet at a mutually acceptable time and location within thirty (30) days after the Notice Date and attempt to negotiate a settlement.


 


(b)     Mediation. If the matter remains unresolved within sixty (60) days after the Notice Date, or if the senior executives fail to meet within thirty (30) days after the Notice Date, either party may initiate mediation upon written notice to the other party, whereupon both parties shall be obligated to engage in a mediation proceeding under the then current Center for Public Resources (“CPR”) Model Procedure for Mediation of Business Disputes, except that specific provisions of this Section override
inconsistent provisions of the CPR Model Procedure. The mediator will be
selected from the CPR Panels of Neutrals. If the parties cannot agree upon the
selection of a mediator within ninety (90) days after the Notice Date, then
upon the request of either party, the CPR shall appoint the mediator. The
parties shall attempt to resolve the dispute through mediation until one of the
following occurs: (i) the parties reach a written settlement; (ii) the
mediator notifies the parties in writing that they have reached an impasse; (iii) the
parties agree in writing that they have reached an impasse; or (iv) the
parties have not reached a settlement within one hundred and twenty (l20) days
after the Notice Date.


 


(c)     Trial Without Jury. If the
parties fail to resolve the dispute through the procedures of this Article 7,
or if neither party elects to initiate mediation, either party may pursue
any other remedies legally available to resolve the dispute. However, the
parties waive any right to a jury trial in any legal proceeding under this
Section.


 


7.3.      Preservation of Rights Pending Resolution.


 

















 


(a)     Performance to Continue.
Each party shall continue to perform its obligations under this Agreement
pending final resolution of any dispute arising out of or relating to this
Agreement. However, either party may suspend performance of its
obligations during any period in which the other party fails or refuses to perform its
obligations.


 


(b)     Provisional Remedies.
Although the procedures specified in this Article 7 are the exclusive procedures
for resolution of disputes arising out of or relating to this Agreement, either
party may seek a preliminary injunction or other provisional equitable
relief its reasonable judgment, that action is necessary to avoid irreparable
harm to itself or to preserve its rights under this Agreement.


 


(c)     Statute of Limitations.
The parties agree that all applicable statutes of limitation and time-based
defenses (such as, estoppel and laches) will be tolled while the procedures set
forth in Subsections 7.2. (a) and 7.2. (b) are pending. The parties
shall take any actions necessary to effectuate this result.


 


8.          Miscellaneous.


 


8.1.       Compliance with Law and Policies. Sponsor
agrees to comply with applicable law and the policies of Institution in the
area of technology transfer, including the University of Massachusetts Policy
on Conflicts of Interest Relating to Intellectual Property and Commercial
Ventures, the University of Massachusetts Intellectual Property Policy, and the
University of Massachusetts Policy on Faculty Consulting and Outside Activities
and shall promptly notify Institution of any violation that Sponsor knows or
has reason to believe has occurred or is likely to occur.


 


8.2.       Indemnification.


 


(a)     Indemnity. Sponsor shall
indemnify, defend, and hold harmless Indemnities against any liability, damage,
loss, or expense (including reasonable attorneys fees and expenses of
litigation) incurred by or imposed upon any of the Indemnities in connection
with any claims suits, actions, demands or judgments arising out of any theory
of liability (including without limitation actions in the form of tort,
warranty, or strict liability and regardless of whether the action has any
factual basis) relating to this Agreement or concerning any product, process,
or service that is made, used, or sold pursuant to any right or license granted
under this Agreement. However, indemnification shall not apply to any
liability, damage, loss or expense to the extent directly attributable to (i) the
negligent activities, gross, wanton or willful conduct or intentional
misconduct of the Indemnitees or (ii) the settlement of a claim, suit,
action, or demand by Indemnitees without the prior written approval of Sponsor.
To the extent allowed by law, institution shall indemnify Sponsor
against any suit, claim or proceeding brought against Institution or Sponsor in
which and to the extent that: (i) any alleged patent infringement arises
from the use by Institution, without advance written approval or consent of
Sponsor, of a combination of the Sponsor’s MFZR or MMR equipment with products
not supplied by Sponsor, (ii) any material violation of any affirmative
covenant or restriction including but not limited to not use the Proprietary Materials in any in vivo experiments on
human subjects, non- permitted
disclosure of Sponsors trade secrets and customer identities, or the use of .To the extent allowed by law, institution shall indemnify and hold
Sponsor, its officers, directors and agents


 

















 


harmless in such suit, claim or proceeding and any
damages arising from any of the foregoing acts.


 


(b)     Procedures. To the extent allowed by law, any
of the Indemnities agree to provide the indemnifying party with prompt written
notice of any claim, suit, action, demand, or judgment for which indemnification
is sought from the indemnifying party under this Agreement. the indemnifying party
agrees, at its own expense, to provide attorneys reasonably acceptable to Indemnitees
to defend against a claim. To the
extent allowed by law, the Indemnities shall cooperate
fully with the indemnifying party in any defense and will permit the
indemnifying party to conduct and control the defense and the disposition of
the claim, suit, or action (including, all decisions relative to litigation,
appeal, and settlement). However, to the
extent allowed by law, any Indemnitee may retain its own
counsel, at the expense of the indemnifying party, if representation by the
counsel retained by the indemnifying party would be inappropriate because of
actual or potential differences in the interests of the Indemnitee and any
other party represented by that counsel. To the extent allowed by law, the
indemnifying party agrees to keep Indemnitees informed of the progress in the
defense and disposition of the claim and to consult with Indemnitees with
regard to any proposed settlement.


 


8.3.       Publicity Restrictions.
Sponsor shall not use the name of Institution or any of its trustees, officers,
faculty, students, employees, or agents, or any adaptation of their names, or
any terms of this Agreement in any promotional material or other public
announcement or disclosure without the prior written consent of Institution.
The foregoing notwithstanding, Sponsor shall have the right to disclose that
information without the consent of Institution in any prospectus, offering
memorandum, or other document or filing required by applicable securities laws
or other applicable law or regulation, provided that Sponsor gives Institution
at least ten

(lO) days prior written notice of the proposed text for the purpose of allowing
Institution to comment on the text.


 


8.4.       Warranty Disclaimer.
Institution makes no express warranties and disclaims any implied warranties as
to any matter relating to this Agreement, including without limitation the
performance or results of the Research Project; the availability of legal
protection for any Research Results, Project Materials, Inventions,
copyrightable works, or any other product of the Research Project; or the
validity or enforceability of any Patent Right that may be obtained
pursuant to this Agreement. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES OF
MERCHANTABILTTY OR FITNESS FOR A PARTICULAR PURPOSE FOR ANY PROJECT MATERTALS
OR RESEARCH RESULTS, OR THAT THE USE OF PROJECT MATERIALS OR RESEARCH RESULTS
WILL NOT INFRINGE ANY PATENT RIGHTS OR OTHER PROPRIETARY RIGHTS OF A THIRD
PARTY.


 


8.5.       Notice to Other Investigators. The Principal Investigator shall furnish all investigators involved in
the Research Project, including faculty, staff, students, and postdoctoral fellows,
with written notice of their obligations under Articles 4 and 5 of this
Agreement.


 


8.6.       Research Partially Funded by Grants.


 


(a)     Federal Government. To the
extent that any Invention has been funded by the federal government, this
Agreement and the grant of any rights in that Invention is subject to


 

















 


and governed by federal law as
set forth in 35 U.S.C. 9~ 201-21 i, and the regulations promulgated thereunder,
as amended, or any successor statutes or regulations. If any term of this
Agreement fails to conform to those laws and regulations, the relevant
term shall be invalid and modified by the parties pursuant to Section 8.16.


 


(b)     Other Organizations. To
the extent that any Invention has been partially funded by a non-profit
organization or state or local agency, this Agreement and the grant of any
rights in that Invention is subject to and governed by the terms of the
applicable research grant. If any term of this Agreement fails to conform to
those terms, the relevant term shall be deemed an invalid provision and
modified by the parties pursuant to Section 8.16. At the request of
Sponsor, Institution shall make available to Sponsor the terms of any research
grants that will partially fund the Research Project.


 


8.7.       Tax-Exempt Status. Sponsor
acknowledges that Institution, as a public institution of the Commonwealth of
Massachusetts, is an exempt organization under the United States Internal
Revenue Code of 2986, as amended. Sponsor also acknowledges that certain
facilities in which the Research Project may be performed were financed
through offerings of tax-exempt bonds. If the Internal Revenue Service
determines, or if counsel to Institution reasonably determines, that any term
of this Agreement jeopardizes the tax-exempt status of Institution or the bonds
used to finance Institution facilities, the relevant term or provision therein
shall be invalid and modified by the parties pursuant to Section 8. 16.


 


8.8.       Relations, Parties. Each
party is an independent contractor and not an agent or employee of the other
party. Neither party may make any statements, representations, or
commitments of any kind, or take any action, which is binding on the other
party, except as may be explicitly provided for in this Agreement or
authorized in writing by the other party.


 


8.9.       Counterparts. This Agreement may be executed in one or more counterparts, each
of which is deemed an original, and all of which together are deemed to be one
and the same instrument.


 


8.10.     Headings. All headings are
for convenience only and do not affect the meaning of any provision of this
Agreement.


 


8.11.     Binding Effect. This
Agreement is binding upon and inures to the benefit of the parties and their
respective permitted successors and assigns.


 


8.12.     Assignment. This Agreement
may not be assigned by either party without the prior written consent of
the other party, except that Sponsor may assign this Agreement to an
affiliate or to a successor in connection with the merger, consolidation, or
sale of all or substantially all of its assets or that portion of its business
to which this Agreement relates.


 


8.13.     Amendment and Waiver. This
Agreement may be amended, supplemented, or otherwise modified only by
means of a written instrument signed by both parties. Any waiver of any rights
or failure to act in a specific instance shall relate only to that instance and
shall not be construed as an agreement to waive any rights or fail to act in
any other instance, whether or not


 

















 


similar.


 


8.14.     Governing Law. This
Agreement shall be governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts irrespective of any conflicts of law principles.


 


8.15.     Notice. Any notices
required or permitted under this Agreement shall be in writing, shall
specifically refer to this Agreement, and shall be sent by hand confirmed in
writing, recognized national overnight courier, confirmed facsimile
transmission, confirmed electronic mail, or registered or certified mail,
postage prepaid, return receipt requested, to the following addresses or
facsimile numbers of the parties:


 


If to Institution:


 


Office of Commercial Ventures and Intellectual Property
University of Massachusetts Lowell


600 Suffolk Street, 2nd Floor South


Lowell, MA 01854


 


	
  Attention:

  	
  Louis J. Petrovic

  
	
  Title:

  	
  Director, CVIP/Lowell

  
	
  Tel:

  	
  978-934-2577

  
	
  Fax:

  	
  978-934-4043

  



 


If to Sponsor:


 


	
  MFIC Corporation

  
	
  30 Ossipee Road

  
	
  Newton, MA 02464-9101

  
	
  Attention:

  	
  Irwin
  J. Gruveman, P.E.

  
	
  Title:

  	
  Chairman &
  CEO

  
	
  Tel:

  	
  617-969-5452

  
	
  Fax:

  	
  617-965-1213

  



 


All notices under this Agreement are effective upon
receipt. A party may change its contact information immediately upon
written notice to the other party in the manner provided in this Section.


 


8.16.     Severability. In the event
that any provision of this Agreement: (i) is held invalid or unenforceable
for any reason, or (ii) jeopardizes the tax-exempt status of Institution
or the bonds used to finance Institution facilities under circumstances set for
the in Section 8.7, the invalidity, unenforceability, or offending
language or provision shall not affect any other provision of this Agreement,
and the parties shall negotiate in good faith to modify the Agreement to
preserve (to the extent possible) their original intent. If the parties fail to
reach a modified agreement within sixty (60) days after the relevant provision
is held invalid or unenforceable, then the dispute shall be resolved according
to Article 7. While the dispute is


 

















 


pending resolution, this Agreement shall be construed as
if the provision were deleted by agreement of the parties.


 


8.17.     Entire Agreement. This
Agreement constitutes the entire agreement between the parties with respect to
its subject matter and supersedes all prior agreements or understandings
between the parties relating to its subject matter.


 


The parties have caused this Agreement to be executed by
their duly authorized representatives as of the date first written above.


 


	
  UNIVERSITY OF MASSACHUSETTS,

  
	
  LOWELL

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  William Hogan

  
	
   

  	
  Chancellor

  



 


	
  MIFC CORPORATION

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Irwin J. Gruveman, P.E.

  
	
   

  	
  Chairman & CEO

  



 

















 


Exhibit A


 


The UML Nanomanufacturing
research initiative will investigate in a series of research projects the
sizing, encapsulation, reaction, and other potential applications of Microfluidizer® technology. Initial projects will be focused on the Sponsor’s
Microfluidizer® Processor (MFZR) and Microfluidizer®
Mixer/Reactor (MMR) technologies.


 


Projects
for this research collaboration will be chosen after review of an Advisory
Committee composed of Dr. Julie Chen, Dr. Robert Nicolosi and one
other Institution faculty representative and two Technical Representatives of Sponsor.


 

















 


Exhibit B


 


For this research
collaboration, Sponsor will:


 


1.       Consign an MMR
lab system to be installed and located at UML.


 


2.       Train users,
consult on proposed uses, and advise on development.


 


3.       Share MMR
technology and MFZR technology/database subject to the confidentiality terms of
this Research Collaboration Agreement.


 


4.       Develop
chamber design and optimization technology, and optimize process and post-process
procedures, both general and specific, jointly with UML research investigators.


 


5.       If additional
MFZR and MMR equipment is needed, it will be provided at 70% of best third
party price. Acquisition is dependent on UML’s ability to pay for the equipment.


 


6.       For each
project recommended by the Advisory Committee that is specifically oriented
towards Sponsor’s research objectives, Sponsor will bear the first $3,000 for
each discrete project. Any further monies needed will be provided by UML if the
monies are available. Sponsor’s
commitment to fund $3000 for recommended discrete projects in any twelve month
period shall be capitated at $36,000. Sponsor shall not be obligated to fund
additional projects in such timeframe, except as Sponsor in its sole discretion
shall deem reasonable and appropriate.


 


7.       Sponsor will support
UML’s efforts to obtain funding from Federal, Massachusetts, Foundation, and
commercial (strategic partner) sources. Such support could be in the form of
subcontract, consignment of equipment, matching funds, in kind contributions,
and other as required on a case by case basis, but only to the extent that
Sponsor, in its sole discretion, shall determine is reasonable and warranted
under the circumstances.


 


8.       When needed, Sponsor
will provide marketing inputs needed and required by the Advisory Committee and
undertaken by various units (CVIP, College of Management, other) of UML. Such
marketing inputs shall be provided in such reasonable amounts and at such times
as shall be reasonably convenient to MFIC as shall not unduly interfere with Sponsor’s
business, in Sponsor’s sole judgment.


 

















 


Appendix C


 


MFIC
(Sponsor) Value Contribution to Research Collaboration Agreement


 


MFIC
Corporation, together with its subsidiary, Microfluidics
Corporation, collectively “Sponsor”, has been in discussions since the summer,
2004 with the University of Massachusetts Lowell (the “University”) regarding
the proposed Research Collaboration. During this period of time, Sponsor has
devoted considerable time and attention to identifying and evaluating key terms
and conditions to meet the University’s objectives in this collaboration.


 


As an indication of good
faith and seriousness regarding the proposed Research Collaboration, Sponsor
has already committed and proposes to commit significant monetary value and
resources, including but not limited to:


 


1.     A Microfluidizer®
processor, valued at almost $100,000 has already been on loan to Professor
Robert Nicolosi. This Microfluidizer processor resides in Dr. Nicolosi’s
lab on the University’s South Campus.


 


2.     Sponsor has
already supported the ongoing operation of the Microfluidizer processor in Dr. Nicolosi’s lab, including provision
of technical support, spare parts and service support. This work to date is
valued at ~$10,000.


 


3.     As part of
the proposed future Research Collaboration, Sponsor has already agreed to
provide one of only two state-of-the-art MMR systems, equipped with dual feed
and chamber capability. The MMR has a current value of over $350,000 and Sponsor
has agreed to having this MMR system physically reside on the campus of the
University.


 


4.     In support of
the MMR system on campus at the University, Sponsor has also agreed to support
with technical capability, spare parts and service to ensure full and
continuous operation of the MMR system. This service component offering if sold
commercially has a value of ~10% or $35,000 of the MMR system’s sale value over
2005.


 


5.     The proposed
Research Collaboration calls for the formation, assembly and participation of
key members of both Sponsor and University to identify and evaluate ongoing
research and development product applications using both Sponsor’s
Microfluidizer processor and the MMR system. To this end, senior management at Sponsor
are anticipating spending some days per month ensuring that the Research
Collaboration is proceeding according to the agreed to plan, milestones and
timeframe. We estimate the monetary value of this personnel effort and
contribution by Sponsor to be worth in excess of $50,000 over 2005. Such
valuation of Sponsor’s contribution is predicated upon the appropriate
expenditure of time to the Research Collaboration activities by MFIC’s Vice
President of R&D, Dr. Thomai Panagiotou.


 


Therefore, we estimate Sponsor’s
monetary value to the Research Collaboration to be in excess of $545,000, and
during 2005, in excess of the likely time and materials effort on the part of
the University.