exv10w1






Exhibit 10.1




MASSACHUSETTS INSTITUTE OF TECHNOLOGY




EXCLUSIVE PATENT LICENSE AGREEMENT



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




 









 





Ver. EQ.5/8/00




MASSACHUSETTS INSTITUTE OF TECHNOLOGY

EXCLUSIVE PATENT LICENSE AGREEMENT




     This Agreement, effective as of the date set forth above the signatures of the parties below
(the “EFFECTIVE DATE”), is between the Massachusetts Institute of Technology (“M.I.T.”), a
Massachusetts corporation, with a principal office at 77 Massachusetts Avenue, Cambridge, MA
02139-4307 and BioTrove, Inc., a corporation having its principal office at 620 Memorial Drive,
Cambridge, MA 02139 (“COMPANY”).



R E C I T A L S




     WHEREAS, M.I.T. is the owner of certain PATENT RIGHTS (as later defined herein) relating to
M.I.T. Case No. 7967, “Method And Apparatus For Performing Microassays” by Ian Hunter and M.I.T.
Case No. 9118, “Molecular Screening In An Array Of Through-holes”, by Colin J. Brenan And Tanya S.
Kanigan and has the right to grant licenses under said PATENT RIGHTS;



     WHEREAS, Ian Hunter is an inventor of the PATENT RIGHTS and a current employee of M.I.T., and
has or will shortly acquire equity in COMPANY, the Conflict of Interest Avoidance Statement of Ian
Hunter is attached as Exhibit A hereto;



     WHEREAS, Ian Hunter, an inventor of the PATENT RIGHTS, has or will shortly acquire equity in
COMPANY not resulting from this Agreement, the Waiver of Participation in M.I.T.’s institutional
equity share of Ian Hunter is attached as Exhibit B hereto;



     WHEREAS, M.I.T.’s Vice President for Research has approved that Ian Hunter, an inventor of the
PATENT RIGHTS, now holds or shall shortly acquire equity in COMPANY and that M.I.T. is accepting
equity as partial consideration for the rights and licenses granted under this Agreement;



     WHEREAS, M.I.T. desires to have the PATENT RIGHTS developed and commercialized to benefit the
public and is willing to grant a license thereunder;


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




 









 





     WHEREAS, COMPANY has represented to M.I.T., to induce M.I.T. to enter into this Agreement,
that COMPANY shall commit itself to a thorough, vigorous and diligent program of exploiting the
PATENT RIGHTS so that public utilization shall result therefrom; and



     WHEREAS, COMPANY desires to obtain a license under the PATENT RIGHTS upon the terms and
conditions hereinafter set forth.



     NOW, THEREFORE, M.I.T. and COMPANY hereby agree as follows:



1. DEFINITIONS.




     1.1 “AFFILIATE” shall mean any legal entity (such as a corporation, partnership, or
limited liability company) that is controlled by COMPANY. For the purposes of this definition, the
term “control” means (i) beneficial ownership of at least fifty percent (50%) of the voting
securities of a corporation or other business organization with voting securities or (ii) a fifty
percent (50%) or greater interest in the net assets or profits of a partnership or other business
organization without voting securities.



     1.2 “EXCLUSIVE PERIOD” shall mean the period of time set forth in Section 2.2.



     1.3 “FIELD” shall mean for use in devices or methods for storage or processing,
analysis or synthesis of chemicals or materials such as DNA, proteins, peptides, probes, solutions,
small molecules, cells, or tissues, polymers, inorganics, catalysts, crystals or solution
conditions;



     1.4 “LICENSED PRODUCT” shall mean any product or part thereof that:



          (i) absent the license granted hereunder, would infringe one or more claims of the PATENT
RIGHTS; or




          (ii) is manufactured by using a LICENSED PROCESS or that, when used, practices a LICENSED
PROCESS.



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




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     1.5 “LICENSED PROCESS” shall mean any process that, absent the license granted
hereunder, would infringe one or more claims of the PATENT RIGHTS or which uses a LICENSED PRODUCT.



     1.6 “NET SALES” shall mean the gross amount billed by COMPANY and its AFFILIATES and
SUBLICENSEES for LICENSED PRODUCTS and LICENSED PROCESSES, less the following:



          (i) customary trade, quantity, or cash discounts appropriate for that market segment to the
extent actually allowed and taken;




          (ii) amounts repaid or credited by reason of rejection, damaged goods, claims or shortages or
return;




          (iii) to the extent separately stated on purchase orders, invoices, or other documents of
sale, any taxes, tariffs, duties or other governmental charges levied on the production, sale,
transportation, delivery, or use of a LICENSED PRODUCT or LICENSED PROCESS which is paid by or on
behalf of COMPANY; and




          (iv) outbound transportation and freight costs prepaid or allowed and costs of insurance in
transit.




          (v) bad debts provided that such debts do not exceed 2% of NET SALES where bad debts are
defined as amounts billed but unpaid after 180 days.




     No deductions shall be made for commissions paid to individuals whether they are with
independent sales agencies or regularly employed by COMPANY and on its payroll, or for cost of
collections. NET SALES shall occur on the date of billing for a LICENSED PRODUCT or LICENSED
PROCESS. If a LICENSED PRODUCT or a LICENSED PROCESS is distributed at a discounted price that is
substantially lower than the customary price charged by COMPANY, or distributed for non-cash
consideration (whether or not at a discount), NET SALES shall be calculated based on the
non-discounted amount of the LICENSED PRODUCT


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




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or LICENSED PROCESS charged to an independent third party during the same REPORTING PERIOD or,
in the absence of such sales, on the fair market value of the LICENSED PRODUCT or LICENSED PROCESS.



     If COMPANY, any AFFILIATE, or any SUBLICENSEE accepts non-monetary consideration for any
LICENSED PRODUCTS or LICENSED PROCESSES, COMPANY shall:



          (i) calculate the fair market equivalent value for such non-monetary consideration, and




          (ii) add such value to the NET SALES figure used to calculate the royalty due in Section
4.1(c) in the REPORTING PERIOD, and




          (iii) include a written justification for such fair market equivalent value as part of the
reporting required by Section 5.2(v). M.I.T. shall retain the right to dispute such justification
as provided by Section 5.4 of this Agreement.




     1.7 “PATENT RIGHTS” shall mean:



          (a) the United States and international patents listed on Appendix A;




          (b) the United States and international patent applications and/or provisional applications
listed on Appendix A and the resulting patents;




          (c) any patent applications resulting from the provisional applications listed on Appendix
A, and any divisionals, continuations, continuation-in-part applications, and continued
prosecution applications (and their relevant international equivalents) of the patent applications
listed on Appendix A and of such patent applications that result from the provisional
applications listed on Appendix A, to the extent the claims are directed to subject matter
specifically described in the patent applications listed on Appendix A, and the resulting
patents;




          (d) any patents resulting from reissues, reexaminations, or extensions (and their relevant
international equivalents) of the patents described in (a), (b), and (c) above;



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




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          (e) international (non-United States) patent applications and provisional applications filed
after the EFFECTIVE DATE and the relevant international equivalents to divisionals, continuations,
continuation-in-part applications and continued prosecution applications of the patent applications
to the extent the claims are directed to subject matter specifically described in the patents or
patent applications referred to in (a), (b), (c), and (d) above, and the resulting patents.




     1.8 “REPORTING PERIOD” shall begin on the first day of each calendar quarter and end
on the last day of such calendar quarter.



     1.9 “SUBLICENSE INCOME” shall mean any payments that COMPANY or an AFFILIATE actually
receives from a SUBLICENSEE for the sublicense of the rights granted COMPANY and AFFILIATES under
Section 2.1, including without limitation license fees, milestone payments other than DEVELOPMENTAL
MILESTONE PAYMENTS, license maintenance fees, and other payments, but specifically excluding
RESEARCH COST REIMBURSEMENTS, DISCOVERY PAYMENTS, DEVELOPMENTAL MILESTONE PAYMENTS, and royalties
on NET SALES.



     1.10 “SUBLICENSEE” shall mean any non-AFFILIATE sublicensee of the rights Granted
COMPANY under Section 2.1.



     1.11 “TERM” shall mean the term of this Agreement, which shall commence on the
EFFECTIVE DATE and shall remain in effect until the expiration or abandonment of all issued patents
and filed patent applications within the PATENT RIGHTS, unless earlier terminated in accordance
with the provisions of this Agreement.



     1.12 DEVELOPMENTAL MILESTONE PAYMENTS shall mean any payment for the demonstration of
substantial technical progress, performance, capability or discovery as relates to progress toward
implementing a LICENSED PRODUCT or LICENSED PROCESS under a research, development, testing,
collaboration or co-development arrangement as documented by delivery to the payor of a written
report including payments for introduction of products to market and completion of clinical trials which is in excess of RESEARCH COST
REIMBURSEMENTS.


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




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     1.13 RESEARCH COST REIMBURSEMENTS shall mean any payment for research and/or
development that used PATENT RIGHTS under a research, development, testing, collaboration or
co-development arrangement as documented by delivery to the payor of a written report which is not
in excess of reimbursement for the costs, APPORTIONED OVERHEAD and salaries and fees required to
conduct such research or development.



     1.14 DISCOVERY PAYMENTS shall mean any payment received by COMPANY from a third party
or SUBLICENSEE related to sales by a third party or AFFILIATE or SUBLICENSEE of products identified
by the use of LICENSED PRODUCTS or LICENSED processes. DISCOVERY payments may be received from
either a customer or SUBLICENSEE.



     1.15 APPORTIONED OVERHEAD shall mean actual pro-rata costs related to the development
of a LICENSED PRODUCT or LICENSED PROCESS such as employee benefits, rent, utilities, insurance,
taxes, etc but in any case no greater than 150% of salary and benefits, provided however that
COMPANY may request that the 150% cap be increased based on COMPANY providing M.I.T. with the
detailed costs actually incurred over a twelve month period.



2. GRANT OF RIGHTS.




     2.1 License Grants. Subject to the terms of this Agreement, M.I.T. hereby grants to
COMPANY and its AFFILIATES for the TERM a royalty-bearing worldwide license under the PATENT RIGHTS
to develop, make, have made, use, sell, offer to sell, lease, and import LICENSED PRODUCTS in the
FIELD and to develop and perform LICENSED PROCESSES in the FIELD.



     2.2 Exclusivity. In order to establish an EXCLUSIVE PERIOD for COMPANY, M.I.T. agrees
that it shall not grant any other license to make, have made, use, sell, lease and import LICENSED
PRODUCTS in the FIELD or to perform LICENSED PROCESSES in the FIELD during the period of time commencing on the EFFECTIVE DATE and terminating as follows:


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.



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          (a) at the end of the TERM if the total of cumulative payments made by COMPANY to M.I.T.
required by paragraphs 4.1 (c), (d), (e), and (f) exceed
six hundred thousand dollars ($600,000) prior to
seven (7) years from the EFFECTIVE
DATE;




          (b) if the total of cumulative payments made by COMPANY to M.I.T. as required by paragraphs
4.1 (c), (d), (e), and (f) are less than six hundred
thousand dollars ($600,000) as of seven (7) years from the EFFECTIVE DATE then the
exclusive period shall terminate on the earlier of the following dates:




               (i) the expiration of seven (7) years after the first accrual of NET SALES or SUBLICENSE
INCOME for a LICENSED PRODUCT or LICENSED PROCESS; or



               (ii) the expiration of ten (10) years after the EFFECTIVE DATE.



          If the EXCLUSIVE PERIOD shall expire in accordance with the terms hereof, the license granted
hereunder shall become nonexclusive and shall extend to the end of the TERM, unless sooner
terminated as provided in this Agreement.




     2.3 Sublicenses. COMPANY shall have the right to grant sublicenses of its rights
under Section 2.1 only during the EXCLUSIVE PERIOD. Such sublicenses may extend past the
expiration date of the EXCLUSIVE PERIOD, but any exclusivity of such sublicense shall expire upon
the expiration of the EXCLUSIVE PERIOD. COMPANY shall incorporate terms and conditions into its
sublicense agreements sufficient to enable COMPANY to comply with this Agreement. COMPANY shall
promptly furnish M.I.T. with a fully signed photocopy of any sublicense agreement, which shall be
deemed to be confidential information of the COMPANY. Should COMPANY’s license be terminated for
any reason, made non-exclusive or otherwise modified to the extent that COMPANY is no longer
permitted to grant rights to sublicensees set out in COMPANY’s sublicense agreements, and should
sublicensees not be in material default of COMPANY’s sublicensee agreements at the time of such
termination, change to non-exclusivity


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




7













 




or modification; then M.I.T. agrees, upon receipt of written notice from sublicensees, to
grant licenses to sublicensees on the same terms and conditions as are set out in their Biotrove
sublicense agreement, or on such other terms and conditions as are agreed upon by M.I.T. and
sublicensees following good faith negotiations; provided, however, that the sublicense agreements
comply, or are amended in a manner requested by sublicenses to bring the sublicense agreements into
compliance with the terms of this Agreement for any sublicenses granted thereunder; and provided
further, upon entering into new sublicenses with sublicensees, that M.I.T. will not be responsible
in any way whatsoever for any of the representations, warranties or obligations of COMPANY under
Biotrove sublicense agreements.


     2.4 Retained Rights.



     (a) M.I.T. M.I.T. retains the right to practice under the PATENT RIGHTS for
research, teaching, and educational purposes.


     2.5 No Additional Rights. Nothing in this Agreement shall be construed to confer any
rights upon COMPANY by implication, estoppel, or otherwise as to any technology or patent rights of
M.I.T. or any other entity other than the PATENT RIGHTS, regardless of whether such technology or
patent rights shall be dominant or subordinate to any PATENT RIGHTS.


3. COMPANY DILIGENCE OBLIGATIONS.



     3.1 Diligence Requirements. COMPANY shall use diligent efforts, or shall use
reasonable efforts to cause its AFFILIATES and SUBLICENSEES to use diligent efforts, to develop
LICENSED PRODUCTS or LICENSED PROCESSES and to introduce LICENSED PRODUCTS or LICENSED PROCESSES
into the commercial market; thereafter, COMPANY or its AFFILIATES or SUBLICENSEES shall make
LICENSED PRODUCTS or LICENSED PROCESSES reasonably available to the public. Specifically, COMPANY
or AFFILIATE or SUBLICENSEE shall fulfill the following obligations:

Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.



8








 





          (a) Within six months after the EFFECTIVE DATE, COMPANY shall furnish M.I.T. with a written
research and development plan describing the major tasks to be achieved in order to bring to market
a LICENSED PRODUCT or a LICENSED PROCESS, specifying the number of staff and other resources to be
devoted to such commercialization effort.




          (b) Within 120 days after the end of each calendar year, COMPANY shall furnish M.I.T. with a
written report (consistent with Section 5.1(a)) on the progress of its efforts during the
immediately preceding calendar year to develop and commercialize LICENSED PRODUCTS or LICENSED
PROCESSES. The report shall also contain a discussion of intended efforts and sales projections
for the year in which the report is submitted.




          (c) COMPANY shall develop a working model within 18 months of the EFFECTIVE DATE and permit an
in-plant inspection by M.I.T. on or before three years from the EFFECTIVE DATE and thereafter
permit in-plant inspections by M.I.T. at regular intervals with at least one year between each such
inspection.




          (d) COMPANY shall raise in the aggregate [***] by January 1, 2002 of unrestricted funds.




          (e) COMPANY shall raise in the aggregate [***] by January 1, 2004 of unrestricted funds.




          (f) COMPANY anticipates that it will need to fund research and development of LICENSED
PRODUCTS and/or LICENSED PROCESSES as follows:




	 	 	 	 	 
	2001 through end of 2002
	 	$[***]	 
	2003 and each subsequent year until NET SALES reach
	 	$[***] per year
	 
	 	$[***] per year





 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




9









 




          (g) COMPANY shall make a first commercial sale of a LICENSED PRODUCT and/or a first commercial
performance of a LICENSED PROCESS within three (3) years from the EFFECTIVE DATE.




          (h) COMPANY shall make NET SALES and receiving SUBLICENSEE INCOME and DEVELOPMENTAL MILESTONE
PAYMENTS and DISCOVERY PAYMENTS that in the aggregate are at least the following amounts according
to the following schedule:




	 	 	 	 	 
	2004
	 	$	750,000;	 
	2005
	 	$	1,500,000;	 
	2006 and each year thereafter
	 	$3,250,000 	 





Should COMPANY decide to pursue a drug discovery business model for a majority of the business
activities of COMPANY, and should that model make it difficult for COMPANY to comply with the
provisions of this paragraph (3.1(h) COMPANY and M.I.T. agree to meet and develop an appropriate
milestone to substitute for this paragraph based on the new drug discovery business model.




     In the event that M.I.T. determines that COMPANY (or an AFFILIATE or SUBLICENSEE) has failed
to fulfill any of its obligations under this Section 3.1, then M.I.T. may treat such failure as a
material breach in accordance with Section 12.3(b).



4. ROYALTIES AND PAYMENT TERMS.




     4.1 Consideration for Grant of Rights.



          (a) License Issue Fee and Patent Cost Reimbursement. COMPANY shall pay to M.I.T.
within thirty (30) days of the EFFECTIVE DATE, a license issue fee of [***], and in accordance with
Section 6.3, shall reimburse M.I.T for its actual expenses incurred as of the EFFECTIVE DATE in
connection with obtaining the PATENT RIGHTS. These payments are nonrefundable.



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




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          (b) License Maintenance Fees. COMPANY shall pay to M.I.T. the following license
maintenance fees on the dates set forth below:




	 	 	 	 	 
	January 1, 2002
	 	$	[***]	 
	January 1, 2003
	 	$	[***]	 
	January 1, 2004
	 	$	[***]	 
	January 1, 2005
	 	$	[***]	 
	Each January 1st thereafter
	 	$	[***]	 





This annual license maintenance fee is nonrefundable; however, the license maintenance fee shall be
credited to running royalties subsequently due on NET SALES earned during the same calendar year,
if any. License maintenance fees paid in excess of running royalties due in such calendar year
shall not be creditable to amounts due for future years.




          (c) Running Royalties. COMPANY shall pay to M.I.T. a running royalty of [***] of NET
SALES. Running royalties shall be payable for each REPORTING PERIOD and shall be due to M.I.T.
within sixty (60) days of the end of each REPORTING PERIOD. In the event that the PATENT RIGHTS
are determined to be dominated by any patent held by a third party and COMPANY therefore pays any
monies (including but not limited to lump sums or on an ongoing basis) to such third party to
obtain the right to practice under the dominating patent, COMPANY shall be entitled to deduct
one-half (1/2) of such payments from the royalties due under this Section 4.1(c) provided, however,
that the Running Royalty paid to M.I.T. shall in no event be less than [***] of NET SALES.




          (d) Sharing of SUBLICENSE INCOME. COMPANY shall pay M.I.T. a total of [***] of all
SUBLICENSE INCOME received by COMPANY or AFFILIATES, excluding running royalties on NET SALES of
SUBLICENSEES, DEVELOPMENTAL MILESTONE PAYMENTS and DISCOVERY PAYMENTS. Such amount shall be
payable for each REPORTING PERIOD and shall be due to M.I.T. within sixty (60) days of the end of
each REPORTING PERIOD.



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




11









 








          (e) Sharing of DISCOVERY PAYMENTS. COMPANY shall pay M.I.T. a total of [***] of all
DISCOVERY PAYMENTS.




          (f) Sharing of DEVELOPMENTAL MILESTONE PAYMENTS. COMPANY shall pay M.I.T. a total of
[***] of all DEVELOPMENTAL MILESTONE PAYMENTS.




          (g) No Multiple Royalties. If the manufacture, use, lease, or sale of any LICENSED
PRODUCT or the performance of any LICENSED PROCESS is covered by more than one of the PATENT
RIGHTS, multiple royalties shall not be due.




          (h) Combination Sales. If COMPANY sells a LICENSED PRODUCT or PRODUCTS in combination
with other products that are not LICENSED PRODUCTS (“OTHER ITEMS”), the NET SALES for purposes of
Royalty payments on the combination shall be calculated as follows:




          If all LICENSED PRODUCTS and OTHER ITEMS contained in the combination are available
separately, the NET SALES for purposes of the royalty payments will be calculated by multiplying
the NET SALES of the combination by the fraction A/(A+B), where A is the selling price of all
LICENSED PRODUCTS in the combination, and B is the selling price of all OTHER ITEMS in the
combination.




          If the combination includes OTHER ITEMS which are not sold separately (but all LICENSED
PRODUCTS are available separately), the NET SALES for purposes of royalty payments is the selling
price of all LICENSED PRODUCTS in the combination.




          (i) Equity.




          
COMPANY shall issue a total of [***] shares of Common Stock of COMPANY, $[.01] par value per
share, (the “Shares”) in the name of M.I.T. COMPANY represents to M.I.T. that, as of the Effective
Date, the aggregate number of Shares equals [***] of the COMPANY’s issued and outstanding Common
Stock calculated on a “Fully Diluted Basis.” For purposes of



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




12









 




this Section 4.1(i), “Fully Diluted Basis” shall mean that the total number of issued and
outstanding shares of the COMPANY’s Common Stock shall be calculated to include conversion of all
issued and outstanding securities then convertible into common stock, the exercise of all then
outstanding options and warrants to purchase shares of common stock, whether or not then
exercisable, and shall assume the issuance or grant of all securities reserved for issuance
pursuant to any COMPANY stock or stock option plan in effect on the date of the calculation.




          (j) Anti-Dilution Protection. COMPANY shall issue additional shares of Common Stock
to M.I.T., such that M.I.T.’s ownership of outstanding Common Stock shall not fall below [***] on a
Fully Diluted Basis, as calculated after giving effect to the anti-dilutive issuance. Such
calculations shall be made each time the COMPANY receives cash for equity. Such issuances shall
continue until and including the date upon which a total of [***] in cash in exchange for COMPANY’s
capital stock (the “Funding Threshold”) shall be received by COMPANY. Thereafter, no additional
shares shall be due to M.I.T. or any M.I.T. Holder pursuant to this section




     4.2 Payments.



          (a) Method of Payment. All payments under this Agreement should be made payable to
“Massachusetts Institute of Technology” and sent to the address identified in Section 14.1. Each
payment should reference this Agreement and identify the obligation under this Agreement that the
payment satisfies.




          (b) Payments in U.S. Dollars. All payments due under this Agreement shall be drawn on
a United States bank and shall be payable in United States dollars. Conversion of foreign currency
to U.S. dollars shall be made at the conversion rate existing in the United States (as reported in
the Wall Street Journal) on the last working day of the calendar quarter of the applicable
REPORTING PERIOD. Such payments shall be without deduction of exchange, collection, or other
charges, and, specifically, without deduction of withholding or similar taxes or other government
imposed fees or taxes, except as permitted in the definition of NET SALES.



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




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          (c) Late Payments. Any payments by COMPANY that are not paid on or before the date
such payments are due under this Agreement shall bear interest, to the extent permitted by law, at
two percentage points above the Prime Rate of interest as reported in the Wall Street
Journal on the date payment is due.




5. REPORTS AND RECORDS.




     5.1 Frequency of Reports.



          (a) Before First Commercial Sale. Prior to the first commercial sale of any LICENSED
PRODUCT or first commercial performance of any LICENSED PROCESS, COMPANY shall deliver reports to
M.I.T. annually, within sixty (60) days of the end of each calendar year, containing information
concerning the immediately preceding calendar year, as further described in Section 5.2.




          (b) Upon First Commercial Sale of a LICENSED PRODUCT or Commercial Performance of a
LICENSED PROCESS. COMPANY shall report to M.I.T. the date of first commercial sale of a
LICENSED PRODUCT and the date of first commercial performance of a LICENSED PROCESS within sixty
(60) days of occurrence in each country.




          (c) After First Commercial Sale. After the first commercial sale of a LICENSED
PRODUCT or first commercial performance of a LICENSED PROCESS, COMPANY shall deliver reports to
M.I.T. within sixty (60) days of the end of each REPORTING PERIOD, containing information
concerning the immediately preceding REPORTING PERIOD, as further described in Section 5.2.




     5.2 Content of Reports and Payments. Each report delivered by COMPANY to M.I.T. shall
contain at least the following information for the immediately preceding REPORTING PERIOD:



          (i) the number of LICENSED PRODUCTS sold, leased or distributed by COMPANY, its AFFILIATES and
SUBLICENSEES to independent third parties in each



 Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




14









 



country, and, if applicable, the number of LICENSED PRODUCTS used by COMPANY, its AFFILIATES
and SUBLICENSEES in the provision of services in each country;




          (ii) a description of LICENSED PROCESSES performed by COMPANY, its AFFILIATES and SUBLICENSEES
in each country as may be pertinent to a royalty accounting hereunder;




          (iii) the range of gross prices charged by COMPANY, its AFFILIATES and SUBLICENSEES for each
LICENSED PRODUCT and, if applicable, the range of gross prices charged for each LICENSED PRODUCT
used to provide services in each country; and the gross price charged for each LICENSED PROCESS
performed by COMPANY, its AFFILIATES and SUBLICENSEES in each country;




          (iv) calculation of NET SALES for the applicable REPORTING PERIOD in each country, including a
listing of applicable deductions;




          (v) total royalty payable on NET SALES in U.S. dollars, together with the exchange rates used
for conversion;




          (vi) the amount of SUBLICENSE INCOME received by COMPANY from each SUBLICENSEE and the amount
due to M.I.T. from such SUBLICENSE INCOME, including an itemized breakdown of the sources of income
comprising the SUBLICENSE INCOME; and




          (vii) the number of sublicenses entered into for the PATENT RIGHTS, LICENSED PRODUCTS and/or
LICENSED PROCESSES.




     If no amounts are due to M.I.T. for any REPORTING PERIOD, the report shall so state.



     5.3 Financial Statements. On or before the 120th day following the close of COMPANY’s
fiscal year, COMPANY shall provide M.I.T. with COMPANY’s regularly prepared financial statements
for the preceding fiscal year including, at a minimum, a balance sheet and an income statement, certified by COMPANY’s treasurer or chief financial officer or
by an independent auditor.


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




15









 




     5.4 Records. COMPANY shall maintain, and shall use reasonable efforts to cause its
AFFILIATES and SUBLICENSEES to maintain, complete and accurate records relating to the rights and
obligations under this Agreement and any amounts payable to M.I.T. in relation to this Agreement,
which records shall contain sufficient information to permit M.I.T. to confirm the accuracy of any
reports delivered to M.I.T. and compliance in other respects with this Agreement. The relevant
party shall retain such records for at least five (5) years following the end of the calendar year
to which they pertain. Once each year, M.I.T., or M.I.T.’s appointed certified public accountants,
shall have the right, at M.I.T.’s expense, to inspect the COMPANY’s records during normal business
hours in a manner so as not to unreasonably interfere with the operations of the COMPANY, to verify
any reports and payments made or compliance in other respects under this Agreement. In the event
that any audit performed under this Section reveals that there has been an underpayment or
overpayment, then MIT shall notify the COMPANY in writing along with such additional detail so as
to allow the COMPANY to make an independent assessment of the alleged error. If the COMPANY does
not agree with the audit of MIT then it shall notify MIT in writing within 45 days after receipt of
the notice from MIT required hereunder, whereupon both MIT and the COMPANY shall appoint a mutually
agreeable certified public accountant to perform an audit of the COMPANY’s books and records to
determine if there was an overpayment or a underpayment. If such audit reveals an underpayment in
excess of five percent (5%) (the “Audit payment Trigger”), MIT shall notify COMPANY, which shall
bear the full cost of such audit and shall remit any amounts due to M.I.T. within thirty (30) days
of receiving notice thereof from M.I.T. In the event of an overpayment by COMPANY, M.I.T. shall pay
such excess back to COMPANY within thirty (30) days of receiving notice thereof from COMPANY. If
the Audit Payment Trigger is not met, then all costs of the Audit shall be borne 50/50 between MIT
and Company.


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




16









 





6. PATENT PROSECUTION.




     6.1 Responsibility for PATENT RIGHTS. Provided that COMPANY seeks and maintains the
strongest and broadest patent claims practicable in the best interest of M.I.T. and uses patent
attorneys acceptable to M.I.T., such acceptance not to be unreasonably withheld, M.I.T. appoints
COMPANY as its agent to prepare, file, prosecute, and maintain all of the PATENT RIGHTS during the
TERM. COMPANY shall copy M.I.T. on all patent prosecution documents and give M.I.T. reasonable
opportunities to advise COMPANY on such filing, prosecution and maintenance. In the event COMPANY
desires to abandon any patent or patent application within the PATENT RIGHTS, COMPANY shall provide
M.I.T. with reasonable prior written notice of such intended abandonment or decline of
responsibility, and the right to prepare, file, prosecute, and maintain the relevant PATENT RIGHTS,
at M.I.T.’s expense, shall revert to M.I.T. In such event, such M.I.T. paid-for rights shall be
removed from the definition of PATENT RIGHTS under this Agreement and the licenses granted to
COMPANY and its AFFILIATES as to such rights shall terminate.



     6.2 International (non-United States) Filings. Appendix B is a list of
countries in which patent applications corresponding to the United States patent applications
listed in Appendix A shall be filed, prosecuted, and maintained. Appendix B may be
amended by mutual agreement of COMPANY and M.I.T.



     6.3 Payment of Expenses. Payment of all fees and costs, including attorneys fees,
relating to the filing, prosecution and maintenance of the PATENT RIGHTS shall be the
responsibility of COMPANY. As of March 1, 2001 M.I.T. has incurred approximately [***] for such
patent-related fees and costs that have not yet been reimbursed. COMPANY shall reimburse all such
[***] in accordance with Section 4.1(a).



7. INFRINGEMENT.




     7.1 Notification of Infringement. Each party agrees to provide written notice to the
other party promptly after becoming aware of any infringement of the PATENT RIGHTS.


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




17









 





     7.2 Right to Prosecute Infringements.



          (a) COMPANY Right to Prosecute. So long as COMPANY remains the exclusive licensee of
the PATENT RIGHTS in the FIELD, COMPANY, to the extent permitted by law, shall have the right,
under its own control and at its own expense, to prosecute any third party infringement of the
PATENT RIGHTS in the FIELD, subject to Sections 7.4 and 7.5. If required by law, M.I.T. shall
permit any action under this Section to be brought in its name, including being joined as a
party-plaintiff, provided that COMPANY shall hold M.I.T. harmless from, and indemnify M.I.T.
against, any costs, expenses, or liability that M.I.T. incurs in connection with such action.




          Prior to commencing any such action, COMPANY shall consult with M.I.T. and shall consider the
views of M.I.T. regarding the advisability of the proposed action and its effect on the public
interest. COMPANY shall not enter into any settlement, consent judgment, or other voluntary final
disposition of any infringement action under this Section without the prior written consent of
M.I.T.




          (b) M.I.T. Right to Prosecute. In the event that COMPANY is unsuccessful in
persuading the alleged infringer to desist or fails to have initiated an infringement action or
settle the infringement within a reasonable time after COMPANY first becomes aware of the basis for
such action, M.I.T. shall have the right, at its sole discretion, to prosecute such infringement
under its sole control and at its sole expense, and any recovery obtained shall belong to M.I.T.




     7.3 Declaratory Judgment Actions. In the event that a declaratory judgment action is
brought against M.I.T. or COMPANY by a third party alleging invalidity, unenforceability, or
non-infringement of the PATENT RIGHTS, M.I.T., at its option, shall have the right within twenty
(20) days after commencement of such action to take over the sole defense of the action at its own
expense. If M.I.T. does not exercise this right, COMPANY may take over the sole defense of the
action at COMPANY’s sole expense, subject to Sections 7.4 and 7.5.



     7.4 Offsets. COMPANY may offset a total of [***] of any expenses incurred under
Sections 7.2 and 7.3 against any payments due to M.I.T. under Article 4, provided that in no


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




18









 







event shall such payments under Article 4, when aggregated with any other offsets and credits
allowed under this Agreement, be reduced by more than [***] in any REPORTING PERIOD.



     7.5 Recovery. Any recovery obtained in an action brought by COMPANY under Sections
7.2 or 7.3 shall be distributed as follows: (i) each party shall be reimbursed for any expenses
incurred in the action (including the amount of any royalty or other payments withheld from M.I.T.
as described in Section 7.4), (ii) as to ordinary damages, COMPANY shall receive an amount equal to
its lost profits or a reasonable royalty on the infringing sales, or whichever measure of damages
the court shall have applied, and COMPANY shall pay to M.I.T. based upon such amount a reasonable
approximation of the royalties and other amounts that COMPANY would have paid to M.I.T. if COMPANY
had sold the infringing products, processes and services rather than the infringer, and (iii) as to
special or punitive damages, the parties shall share equally in any award.



     7.6 Cooperation. Each party agrees to cooperate in any action under this Article
which is controlled by the other party, provided that the controlling party reimburses the
cooperating party promptly for any costs and expenses incurred by the cooperating party in
connection with providing such assistance.



     7.7 Right to Sublicense. So long as COMPANY remains the exclusive licensee of the
PATENT RIGHTS in the FIELD, COMPANY shall have the sole right to sublicense any alleged infringer
in the FIELD for future use of the PATENT RIGHTS in accordance with the terms and conditions of
this Agreement relating to sublicenses. Any proceeds from such sublicense shall be shared between
COMPANY and M.I.T. as set forth in Article 4.



8. INDEMNIFICATION AND INSURANCE




     8.1 Indemnification.



          (a) Indemnity. COMPANY shall indemnify, defend, and hold harmless M.I.T. and its
trustees, officers, faculty, students, employees, and agents and their respective successors, heirs
and assigns (the “Indemnitees”), against any liability, damage, loss, or expense



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




19









 







(including reasonable attorneys fees and expenses) incurred by or imposed upon any of the
Indemnitees due to 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 such action has any factual basis) concerning any product, process, or
service that is made, used, sold, imported, or performed pursuant to any right or license granted
under this Agreement.




          (b) Procedures. The Indemnitees agree to provide COMPANY with prompt written notice
of any claim, suit, action, demand, or judgment for which indemnification is sought under this
Agreement. COMPANY agrees, at its own expense, to provide attorneys reasonably acceptable to
M.I.T. to defend against any such claim. The Indemnitees shall cooperate fully with COMPANY in
such defense and will permit COMPANY to conduct and control such defense and the disposition of
such claim, suit, or action (including all decisions relative to litigation, appeal, and
settlement); provided, however, that any Indemnitee shall have the right to retain its own counsel,
at the expense of COMPANY, if representation of such Indemnitee by the counsel retained by COMPANY
would be unavailable because of actual conflicts in the interests of such Indemnitee and any other
party represented by such counsel. COMPANY agrees to keep M.I.T. informed of the progress in the
defense and disposition of such claim and to consult with M.I.T. with regard to any proposed
settlement.




     8.2 Insurance. COMPANY shall obtain and carry in full force and effect commercial
general liability insurance, including product liability and errors and omissions insurance which
shall protect COMPANY and Indemnitees with respect to events covered by Section 8.1(a) above. Such
insurance (i) shall be issued by an insurer licensed to practice in the Commonwealth of
Massachusetts or an insurer pre-approved by M.I.T., such approval not to be unreasonably withheld
or delayed, (ii) shall list M.I.T. as an additional insured thereunder, (iii) shall be endorsed to
include product liability coverage prior to the first sale of a LICENSED PRODUCT, and (iv) shall
require thirty (30) days written notice to be given to M.I.T. prior to any cancellation or material
change thereof. The limits of such insurance shall not be less than One Million Dollars
($1,000,000) per occurrence with an aggregate of Three Million Dollars


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




20









 




($3,000,000) for bodily injury including death; One Million Dollars ($1,000,000) per
occurrence with an aggregate of Three Million Dollars ($3,000,000) for property damage, and One
Million Dollars ($1,000,000) per occurrence with an aggregate of One Million Dollars ($1,000,000)
for errors and omissions. In the alternative, COMPANY may self-insure but so long as the Company
is less than $50 Million in assets, such self insurance shall be subject to prior approval of
M.I.T., which shall not be unreasonably withheld or delayed. COMPANY shall provide M.I.T. with
Certificates of Insurance evidencing compliance with this Section. COMPANY shall continue to
maintain such insurance or self-insurance after the expiration or termination of this Agreement
during any period in which COMPANY or any AFFILIATE or SUBLICENSEE continues (i) to make, use, or
sell a product that was a LICENSED PRODUCT under this Agreement or (ii) to perform a service that
was a LICENSED PROCESS under this Agreement, and thereafter for a period of five (5) years.



9. NO REPRESENTATIONS OR WARRANTIES


     EXCEPT AS MAY OTHERWISE BE EXPRESSLY SET FORTH IN THIS AGREEMENT, M.I.T. MAKES NO
REPRESENTATIONS OR WARRANTIES OF ANY KIND CONCERNING THE PATENT RIGHTS, EXPRESS OR IMPLIED,
INCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NONINFRINGEMENT, VALIDITY OF PATENT RIGHTS CLAIMS, WHETHER ISSUED OR PENDING, AND THE ABSENCE OF
LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE. Specifically, and not to limit the
foregoing, M.I.T. makes no warranty or representation (i) regarding the validity or scope of the
PATENT RIGHTS, and (ii) that the exploitation of the PATENT RIGHTS or any LICENSED PRODUCT or
LICENSED PROCESS will not infringe any patents or other intellectual property rights of M.I.T. or
of a third party.



     IN NO EVENT SHALL M.I.T., ITS TRUSTEES, DIRECTORS, OFFICERS, EMPLOYEES AND AFFILIATES BE
LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ECONOMIC DAMAGES OR INJURY TO
PROPERTY AND LOST PROFITS, REGARDLESS OF WHETHER M.I.T. SHALL BE ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY OF THE
FOREGOING.


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




21









 




10. ASSIGNMENT.




     This Agreement may not be assigned by COMPANY without the prior written consent of M.I.T,
which shall not be unreasonably withheld or delayed, except that COMPANY shall be able to assign
this Agreement in connection with the sale of all or a major portion of the assets of the COMPANY
or in connection with the sale of the division of the COMPANY which is responsible for
commercializing the LICENSED PRODUCTS or LICENSED PROCESSES.



11. GENERAL COMPLIANCE WITH LAWS




     11.1 Compliance with Laws. COMPANY shall use reasonable commercial efforts to comply
with all commercially material local, state, federal, and international laws and regulations
relating to the development, manufacture, use, and sale of LICENSED PRODUCTS and LICENSED
PROCESSES.



     11.2 Export Control. COMPANY and its AFFILIATES and SUBLICENSEES shall comply with
all United States laws and regulations controlling the export of certain commodities and technical
data, including without limitation all Export Administration Regulations of the United States
Department of Commerce. Among other things, these laws and regulations prohibit or require a
license for the export of certain types of commodities and technical data to specified countries.
COMPANY hereby gives written assurance that it will comply with, and will cause its AFFILIATES and
SUBLICENSEES to comply with, all United States export control laws and regulations, that it bears
sole responsibility for any violation of such laws and regulations by itself or its AFFILIATES or
SUBLICENSEES, and that it will indemnify, defend, and hold M.I.T. harmless (in accordance with
Section 8.1) for the consequences of any such violation.



     11.3 Non-Use of M.I.T. Name. COMPANY and its AFFILIATES and SUBLICENSEES shall not
use the name of “Massachusetts Institute of Technology,” “Lincoln


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




22









 







Laboratory” or any variation, adaptation, or abbreviation thereof, or of any of its trustees,
officers, faculty, students, employees, or agents, or any trademark owned by M.I.T., or any terms
of this Agreement in any promotional material or other public announcement or disclosure without
the prior written consent of M.I.T. The foregoing notwithstanding, without the consent of M.I.T.,
COMPANY may state that it is licensed by M.I.T. under one or more of the patents and/or patent
applications comprising the PATENT RIGHTS.



     11.4 Marking of LICENSED PRODUCTS. To the extent commercially feasible and consistent
with prevailing business practices, COMPANY shall mark, and shall cause its AFFILIATES and
SUBLICENSEES to mark, all LICENSED PRODUCTS that are manufactured or sold under this Agreement with
the number of each issued patent under the. PATENT RIGHTS that applies to such LICENSED PRODUCT.



12. TERMINATION.




     12.1 Voluntary Termination by COMPANY. COMPANY shall have the right to terminate this
Agreement, for any reason, (i) upon at least three (3) months prior written notice to M.I.T., such
notice to state the date at least three (3) months in the future upon which termination is to be
effective, and (ii) upon payment of all amounts due to M.I.T. through such termination effective
date.



     12.2 Cessation of Business. If COMPANY ceases to carry on its business related to
this Agreement, M.I.T. shall have the right to terminate this Agreement immediately upon written
notice to COMPANY.



     12.3 Termination for Default.



          (a) Nonpayment. In the event COMPANY fails to pay any amounts due and payable to
M.I.T. hereunder, and fails to make such payments within thirty (30) days after receiving written
notice of such failure, M.I.T. may terminate this Agreement immediately upon written notice to
COMPANY.



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




23









 








          (b) Material Breach. In the event COMPANY commits a material breach of its
obligations under this Agreement, except for breach as described in Section 12.3(a), and fails to
cure that breach within ninety (90) days after receiving written notice thereof, M.I.T. may
terminate this Agreement immediately upon written notice to COMPANY.




     12.4 Effect of Termination.



          (a) Survival. The following provisions shall survive the expiration or termination of
this Agreement: Articles 1, 8, 9, 13 and 14, and Sections 4.1(f), 5.2 (obligation to provide final
report and payment), 5.4, 11.1, 11.2 and 12.4.




          (b) Inventory. Upon the early termination of this Agreement, COMPANY and its
AFFILIATES and SUBLICENSEES may complete and sell any work-in-progress and inventory of LICENSED
PRODUCTS that exist as of the effective date of termination, provided that (i) COMPANY pays M.I.T.
the applicable running royalty or other amounts due on such sales of LICENSED PRODUCTS in
accordance with the terms and conditions of this Agreement, and (ii) COMPANY and its AFFILIATES and
SUBLICENSEES shall complete and sell all work-in-progress and inventory of LICENSED PRODUCTS within
six (6) months after the effective date of termination.




          (c) Pre-termination Obligations. In no event shall termination of this Agreement
release COMPANY, AFFILIATES, or SUBLICENSEES from the obligation to pay any amounts that became due
on or before the effective date of termination.




13. DISPUTE RESOLUTION.




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


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




24









 





     13.2 Equitable Remedies. Although the procedures specified in this Article are the
sole and exclusive procedures for the resolution of disputes arising out of or relating to this
Agreement, either party may seek a preliminary injunction or other provisional equitable relief if,
in its reasonable judgment, such action is necessary to avoid irreparable harm to-itself or to
preserve its rights under this Agreement.



     13.3 Dispute Resolution Procedures.



          (a) Mediation. In the event any dispute arising out of or relating to this Agreement
remains unresolved within sixty (60) days from the date the affected party informed the other party
of such dispute, either party may initiate mediation upon written notice to the other party
(“Notice Date”), 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 (http://www.cpradr.org), except that specific provisions of this Article shall
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
fifteen (15) business 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 the first 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 sixty (60) days after the Notice Date.




          (b) Trial Without Jury. If the parties fail to resolve the dispute through mediation,
or if neither party elects to initiate mediation, each party shall have the right to pursue any
other remedies legally available to resolve the dispute, provided, however, that the parties
expressly waive any right to a jury trial in any legal proceeding under this Article.




     13.4 Performance to Continue. Each party shall continue to perform its undisputed
obligations under this Agreement pending final resolution of any dispute arising out of or relating
to this Agreement; provided, however, that a party may suspend performance of its


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




25









 




undisputed obligations during any period in which the other party fails or refuses to perform
its undisputed obligations. Nothing in this Article is intended to relieve COMPANY from its
obligation to make undisputed payments pursuant to Articles 4 and 6 of this Agreement.



     13.5 Statute of Limitations. The parties agree that all applicable statutes of
limitation and time-based defenses (such as estoppel and laches) shall be tolled while the
procedures set forth in Sections 13.3(a) are pending. The parties shall cooperate in taking any
actions necessary to achieve this result.



14. MISCELLANEOUS.




     14.1 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, 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 M.I.T., all matters relating to the license:



Technology Licensing Office, Room NE25-230

Massachusetts Institute of Technology

5 Cambridge Ctr.

R NE25-230

Cambridge, MA 02142

Attention: Director

Tel:     617-253-6966

Fax:    617-258-6790



If to M.I.T., relating to any equity action after the initial issuance of shares:



Massachusetts Institute of Technology

Treasurer’s Office 238 Main Street

Cambridge, MA 02142 Attention: Phillips B. Moore

Tel:     617-253-5422

Fax:    617-258-6676



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




26









 




If to COMPANY:      BioTrove, Inc.



620 Memorial Drive

Cambridge, MA 02139

Attention: Dr. Colin Brenan

Tel:     617-551-3415

Fax:    617-551-3400




          All notices under this Agreement shall be deemed 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.




     14.2 Governing Law. This Agreement and all disputes arising out of or related to this
Agreement, or the performance, enforcement, breach or termination hereof, and any remedies relating
thereto, shall be construed, governed, interpreted and applied in accordance with the laws of the
Commonwealth of Massachusetts, U.S.A., without regard to conflict of laws principles, except that
questions affecting the construction and effect of any patent shall be determined by the law of the
country in which the patent shall have been granted.



     14.3 Force Majeure. Neither party will be responsible for delays resulting from
causes beyond the reasonable control of such party, including without limitation fire, regulatory
delays, materials shortages, act of god, transportation shortages, explosion, flood, war, strike,
or riot, provided that the nonperforming party uses commercially reasonable efforts to avoid or
remove such causes of nonperformance and continues performance under this Agreement with reasonable
dispatch whenever such causes are removed.



     14.4 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 such 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.



     14.5 Severability. In the event that any provision of this Agreement shall be held
invalid or unenforceable for any reason, such invalidity or unenforceability 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


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




27









 







modified agreement within thirty (30) days after the relevant provision is held invalid or
unenforceable, then the dispute shall be resolved in accordance with the procedures set forth in
Article 13. While the dispute is pending resolution, this Agreement shall be construed as if such
provision were deleted by agreement of the parties.



     14.6 Binding Effect. This Agreement shall be binding upon and inure to the benefit of
the parties and their respective permitted successors and assigns.



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



     14.8 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.



     IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly
authorized representatives.



The EFFECTIVE DATE of this Agreement is May 11, 2001.




	 	 	 	 	 	 	 	 	 	 	 
	MASSACHUSETTS INSTITUTE OF
 TECHNOLOGY	 	 	 	BIOTROVE, INC	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Lita Nelson 	 	 	 	By:	 	/s/ Colin Brenan 	 	 
	 

	 	 

	 	 
	 	 	 	 

	 	 
	Name:

	 	Lita L. Nelson, Director 	 	 	 	Name:	 	Colin Brenan 	 	 
	 

	 	 

	 	 
	 	 	 	 

	 	 
	Title:

	 	Technology Licensing Office 	 	 	 	Title:	 	President and C.E.O. 	 	 
	 

	 	 

	 	 
	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	MASSACHUSETTS INSTITUTE OF
 TECHNOLOGY	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:
	 	/s/ J. David Litster 	 	 	 	 	 	 	 	 
	Name:

	 	 

J. David Litster, Ph.D.
	 	 	 	 	 	 	 	 
	Title:

	 	Vice President for Research	 	 	 	 	 	 	 	 





Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




28









 





APPENDIX A




List of Patent Applications and Patents




I. United States Patents and Applications



USA Patent Application Serial No. 09/225583, Filed January 5, 1999, Entitled “Method And Apparatus
For Performing Microassays”.



USA Patent Application Serial No. 09/225583, Filed January 5, 1999, Entitled “Method And Apparatus
For Performing Microassays”.



USA Patent Application Serial No. 09/710082, Filed November 10, 2000, Entitled “Method For
Performing Microassays”.



USA Patent Application Serial No. 60/071179, Filed January 12, 1998, Entitled “Method And Apparatus
For Performing Microassays”.




II. International (non-U.S.) Patents and Applications



PCT Patent Application Serial No. PCT/US99/00088, Filed January 5, 1999, Entitled “Method And
Apparatus For Performing Microassays” designating Australia, Canada, all member countries of the
EPC, Japan, Republic of Korea



EPC Patent Application Serial No. 99901294.1, Filed January 5, 1999, Entitled “Method And Apparatus
For Performing Microassays”, designating all member countries of the EPC



JP Patent Application Serial No. 2000-527355, Filed January 5, 1999, Entitled “Method And Apparatus
For Performing Microassays”.



CAN Patent Application Serial No. 2316912, Filed January 5, 1999, Entitled “Method And Apparatus
For Performing Microassays”.



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




29









 





APPENDIX B




List of Countries (excluding United States) for which 

PATENT RIGHTS Applications Will Be Filed, Prosecuted and Maintained



For all of the following jurisdictions for which PATENT RIGHTS applications are still valid as of
the EFFECTIVE DATE: Canada, France, Germany, Ireland, Italy, Japan, Republic of Korea, Spain,
Sweden, Switzerland and the United Kingdom.



Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.




30









 






	 	 	 	 	 	 	 
	Technology Licensing Office
	 	 	 		 	Massachusetts Institute of Technology
	 
	 	 	 	 	Five Cambridge Center, Kendall Square, Room NE25-230 
	 
	 	 	 	 	 	Cambridge, Massachusetts 02142-1493
	 
	 	 	 	 	 	 
	 	 	 

	 
	 	 	 	 	 	Phone 617-253-6966
	 
	 	 	 	 	 	Fax      617-258-6790
	 
	 	 	 	 	 	Email tlo@mit.edu
	 
	 	 	 	 	 	http://web.mit.edu/tlo/





December 21, 2004.




     Dear Alan:


Our recent discussions indicate that BioTrove is making progress toward first commercial sale of
product but may not be able to meet the impending deadline of December 31, 2004. In addition, we
have come to the conclusion that it is not necessary to have Errors & Omissions Insurance coverage
until this sale takes place. Therefore, M.I.T. is offering to amend Section 8.2, subsection (iii)
of the above referenced license agreement to read as follows: “...shall be endorsed to include
product liability coverage and errors and omissions coverage prior to the first commercial sale of
a LICENSED PRODUCT...” (emphasis added for convenience).



Section 3.1, subsection (g) shall be amended to read as follows: “COMPANY shall make a first
commercial sale of a LICENSED PRODUCT and/or a first commercial performance of a LICENSED PROCESS
by March 31, 2004”



Except as specifically modified or amended hereby, the Agreement shall remain in full force
and effect. The Effective Date of this Amendment is the latest date of the official signatures
below.



Please indicate your acceptance of this Amendment by countersigning both copies of this
letter and returning one to M.I.T.




	 	 	 	 	 
	 	Sincerely,

 	 
	 	/s/ Carl Berke
 	 
	 	Carl Berke 	 
	 	Technology Licensing Officer 	 
	 



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Agreed to for:

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Massachusetts Institute of Technology
	 	 	 	BioTroye, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By	 	/s/ John H. Turner, Jr.	 	 	 	By	 	/s/ Alan T. Barber	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Name
	 	John H. Turner, Jr.
	 	 	 	 	 	Name
	 	Alan T. Barber	 	 
	 

	 	Title
	 	Associate Director Technology Licencing Office
	 	 	 	 	 	Title
	 	CFO	 	 
	 

	 	Date
	 	21 Dec 2004
	 	 	 	 	 	Date
	 	12/30/04	 	 






 








 




February 8, 2005



Alan Barber

BioTrove, Inc.

12 Gill Street, Suite 4000

Woburn, MA 01801




			
	Re:	 	Amendment to Exclusive License Agreement #4908037 (effective 5/11/2001) for: 

M.I.T. Case No. 7967, “Method And Apparatus For Peforming Microassays,” by Ian W. Hunter 

M.I.T. Case No. 9118, “Molecular Screening In An Array Of Through-Holes,” by Colin J. 

Brenan, Ian W. Hunter and Tanya S. Kanigan




Dear Alan:


Our recent discussions indicate that BioTrove is making progress toward first commercial sale of
product but could not meet the deadline of December 31, 2004. In addition, we have come to the
conclusion that it is not necessary to have Errors & Omissions Insurance coverage until this sale
takes place. Therefore, M.I.T. is offering to amend Section 8.2, subsection (iii) of the above
referenced license agreement to read as follows: “...shall be endorsed to include product
liability coverage and errors and omissions coverage prior to the first commercial sale of a
LICENSED PRODUCT...” (emphasis added for convenience).


Section 3.1, subsection (g) shall be amended to read as follows: “COMPANY shall make a first
commercial sale of a LICENSED PRODUCT and/or a first commercial performance of a LICENSED PROCESS
by March 31, 2005.”


Section 3.1 subsection (h) shall be amended to read as follows: “COMPANY shall make NET SALES and
receiving SUBLICENSEE INCOME and DEVELOPMENTAL MILESTONE PAYMENTS and DISCOVERY PAYMENTS that in
the aggregate are at least the following amounts according to the following schedule:



	 	 	 	 	 	 	 	 	 
	Year Ending
	 	March 31, 2006	 	$	750,000;	 
	 
	 	March 31, 2007	 	$	1,500,000;	 
	 
	 	March 31, 2008 and each year thereafter	 	$3,250,000 	 




Should COMPANY decide to pursue a drug discovery business model for a majority of the business
activities of COMPANY that would make it difficult to comply with the provisions of this paragraph
(3.1(h) COMPANY and M.I.T. agree to meet and develop an appropriate milestone to substitute for
this paragraph based on the new drug discovery business model.”


Except as specifically modified or amended hereby, the Agreement shall remain in full force and
effect. The Effective Date of this Amendment is the latest date of the official signatures below.


Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.



 








 




Please indicate your acceptance of this Amendment by countersigning both copies of this letter and
returning one to M.I.T.



	 	 	 	 	 
	 	Sincerely,
 	 
	 	/s/ Carl Berke
 	 
	 	 	 
	 	Carl Berke

Technology Licensing Officer 	 
	 



Agreed to for:




	 	 	 	 	 	 	 	 	 	 	 
	Massachusetts Institute of

Technology	 	 	 	BioTrove, Inc.	 	 
	 
	By: 

Name:

	 	/s/ John H. Turner
 

John H. Turner
	 	 
	 	By:

Name:
	 	/s/ Alan T. Barber
 

Alan T. Barber
	 	 
	Title:	 	Associate Director Technology License Office	 	 	 	Title:
	 	Chief Financial Officer	 	 
	Date:

	 	June 30, 2005
	 	 	 	Date:
	 	2-8-05	 	 





Portions of this Exhibit were omitted and have been filed separately with the Secretary of the
Commission pursuant to the Company’s application requesting confidential treatment under Rule 406
of the Securities Act.





 











 






	 	 	 	 	 	 	 
	Technology Licensing Office
	 	 	 	 	 	Massachusetts Institute of Technology
	 
	 	 	 	 	 	Five Cambridge Center, Kendall Square, Room NE25-230 
	 
	 	 	 	 	 	Cambridge, Massachusetts 02142-1493
	 
	 	 	 	 	 	 
	 	 	 

	 
	 	 	 	Letter Amendment	Phone 617-253-6966
	 
	 	 	 	 	 	Fax     617-258-6790
	 
	 	 	 	 	 	Email tlo@mit.edu
	 
	 	 	 	 	 	http://web.mit.edu/tlo/






March 10, 2008




Mr. Colin Brenan

Chief Technology Officer

Vice President, Business Development

BioTrove Inc.

12 Gill Street Suite 4000

Woburn, MA 01801



Re: Amendment to Exclusive License Agreement #4908037 effective May 11, 2001, as amended by letters
dated November 17, 2004, December 21, 2004 and February 8, 2005 (the “License Agreement”) for:



M.I.T. Case No. 7967, “Method And Apparatus For Performing Microassays,” by Ian W. Hunter



M.I.T. Case No. 91 18, “Molecular Screening In An Array Of Through-Holes,” by Colin J.
Brenan, Ian W. Hunter and Tanya S. Kanigan



Dear Colin:



We appreciate BioTrove’s continued diligence in meeting the material and financial obligations of
its License Agreement with M.I.T. While is has made first commercial sales of products and is
making progress toward increasing those sales, progress to date has not been as rapid as
anticipated. Some provisions of Section 3.1(h) have not been met and further provisions of Sections
3.1(h) and 2.2 are not expected to be met, and, consequently, could potentially subject the company
to the termination provisions of Section 12.3(b). In view of continuing commercial progress and
anticipated future ability to obtain financing, we have agreed that it is in the mutual interest of
M.I.T. and BioTrove to amend our License Agreement in Sections 3.1(h) and 2.2.



The parties agree to amend the License Agreement as follows:




     The parties acknowledge that the previously amended requirement of Section 3.1(g) that COMPANY
make a first commercial sale of a LICENSED PRODUCT and/or a first commercial performance of a
LICENSED PROCESS by March 31, 2005 has been met.


Section 2.2 is deleted in its entirety and replaced with the following:




 








 







“2.2 Exclusivity. In order to establish an EXCLUSIVE PERIOD for COMPANY, M.I.T. agrees that
it shall not grant any other license to make, have made, use, sell, lease and import LICENSED
PRODUCTS in the FIELD or to perform LICENSED PROCESSES in the FIELD during the period of time
commencing on the EFFECTIVE DATE and terminating as follows:



(a) at the end of the TERM if the total of cumulative payments made by COMPANY to M.I.T.
required by paragraphs 4.1 (c), (d), (e), and (f) exceed
six hundred thousand ($600,000) prior to
eleven (11) years from the
EFFECTIVE DATE; or



(b) if the total of cumulative payments made by COMPANY to M.I.T. as required by paragraphs
4.1 (c), (d), (e), and (f) are less than six hundred
thousand  ($600,000) as of eleven (11) years from the EFFECTIVE DATE then the
exclusive period shall terminate on the earlier of the following dates:



(i) the expiration of ten (10) years after the first accrual of NET SALES or SUBLICENSE
INCOME for a LICENSED PRODUCT or LICENSED PROCESS; or




(ii) the expiration of thirteen (13) years after the EFFECTIVE DATE.



If the EXCLUSIVE PERIOD shall expire in accordance with the terms hereof, the license
granted hereunder shall become nonexclusive and shall extend to the end of the TERM, unless
sooner terminated as provided in this Agreement.”



Section 3.1(h) is deleted in its entirety and replaced with the following:



“COMPANY shall make NET SALES and receive SUBLICENSEE INCOME, DEVELOPMENTAL MILESTONE
PAYMENTS and DISCOVERY PAYMENTS that in the aggregate total at least
three million two hundred fifty thousand dollars ($3,250,000) in the year ended December 31, 2010 and each year
ending December 31 covered by this Agreement thereafter. Should COMPANY decide to pursue a
drug discovery business model for a majority of the business activities of COMPANY that
would make it difficult to comply with the provisions of this paragraph (3.1(h)), COMPANY
and M.I.T. agree to meet and attempt to develop an appropriate milestone to substitute for
this paragraph based on the new drug discovery business model.



In the event that M.I.T. determines that COMPANY (or an AFFILIATE or SUBLICENSEE) has
failed to fulfill any of its obligations arising under this Section 3.1(h) after December
31, 2010, then M.I.T. may treat such failure as a material breach in accordance with
Section 12.3(b).



For the purposes of clarity, after the AMENDMENT DATE (as defined below) this Amendment in no way
effects the paragraph following Section3.1(h), that states that In the event that M.I.T.
determines that COMPANY (or an AFFILIATE or SUBLICENSEE) has failed to fulfill any of its
obligations under this section 3.1, then M.I.T. may treat such failure as a material breach in
accordance with Section 12.3(b).”



 








 






     As of the Amendment Date, and having given effect to the changes included herein, M.I.T.
agrees that COMPANY has met the diligence obligations contained in Section 3 of the License
Agreement and waives any claim to the contrary.


Except as specifically modified or amended hereby, the Agreement shall remain in full force and
effect. This letter amending the License Agreement will take effect as an amendment complying with
the terms of Section 14.4 of the License Agreement as of the latest date of the official signatures
below (the “AMENDMENT DATE”).



Please indicate your acceptance of this Amendment by countersigning both copies of this letter and
returning one to M.I.T.




	 	 	 	 	 
	Best regards,

 	 	 
	/s/ James R. Freedman
 	 	 
	James R. Freedman 	 	 
	Technology Licensing Officer 	 	 
	 



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Agreed to for:

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Massachusetts Institute of Technology
	 	 	 	BioTroye, Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:	 	/s/ John H. Turner, Jr.	 	 	 	By:	 	/s/ Colin Brenan	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Name
	 	John H. Turner, Jr.
	 	 	 	 	 	Name
	 	Colin Brenan	 	 
	 

	 	Title
	 	Associate Director Technology Licencing Office
	 	 	 	 	 	Title
	 	Chief Technology Officer	 	 
	 

	 	Date
	 	March 13, 2008
	 	 	 	 	 	Date
	 	March 13, 2008