**Exhibit 10.68**

 

CORNELL UNIVERSITY

 

OFFICE OF SPONSORED PROGRAMS

 

AGREEMENT NO. **38941**

 

THIS AGREEMENTis entered into by and between Advanced Cell Technology, Inc., acorporation organized under the laws of Delaware (hereinafter referred to asthe “Sponsor”) and Cornell University, a non-profit, educational institutionhaving corporate powers under the laws of the State of New York (hereinafterreferred to as the “University”).

 

WITNESSETH:

 

WHEREAS, the effortcontemplated by this Agreement is of mutual interest and benefit to theUniversity and to the Sponsor, will further instructional and/or researchobjectives of the University in a manner consistent with its status as anon-profit, tax-exempt, educational institution, and may derive benefits forboth the Sponsor and the University through inventions, improvements, and/ordiscoveries;

 

NOW THEREFORE, inconsideration of the premises and mutual covenants herein contained, theparties hereto agree to the following:

 

1.             Definitions.

 

1.1.          “Project” shall mean the work funded underthis Agreement as described in Exhibit A hereof.

 

1.2.          “Intellectual Property” shall meanindividually and collectively all inventions, improvements and/or discoveries,including deliverable software, if any, which are conceived and first reducedto practice in the performance of the Project.

 

1.3.          “Sponsor Intellectual Property” shall meanIntellectual Property conceived and first reduced to practice solely by one ormore employees of the Sponsor.

 

1.4.          “University Intellectual Property” shall meanIntellectual Property conceived and first reduced to practice solely by one ormore employees of the University.

 

1.5.          “Jointly Owned Intellectual Property” shallmean Intellectual Property conceived and first reduced to practice jointly byone or more employees of the University and by one or more employees of theSponsor.

 

2.             Work. The University agrees to use reasonable efforts to perform theProject.

 

3.             Key Personnel. The following individuals are identified askey personnel for the performance of the Project: **Jonathan R. Hill,**Principal Investigator

 

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**AgreementNo. 38941Sponsor: Advanced Cell Technology**

 

Iffor any reason the Principal Investigator or any other key personnel become unableto continue the Project the University and Sponsor shall attempt to agree upona successor. If the parties are unable to agree upon a successor, thisAgreement shall be terminated in accordance with Article 11., Terminationfor Convenience.

 

4.             Period of Performance. The period of performance of this Agreementwill begin the date this Agreement is executed, and will extend for a one-yearperiod from said date.

 

5.             Reports and Conferences.

 

5.1.          The University shall furnish the Sponsor letter reports at quarterlyintervals during the term of this Agreement, summarizing the work conducted. AtSponsor’s request, University shall provide Sponsor with all experimental protocolsdeveloped under the Project in sufficient written detail to permit Sponsor’spersonnel to employ such procedures in their own research. The University shallsubmit a final written report setting forth the Project accomplishments andsignificant findings within ninety (90) days of the expiration of thisAgreement.

 

5.2.          During the term of this Agreement,representatives of the University will meet with representatives of the Sponsorat times and places mutually agreed upon to discuss the progress and results,as well as ongoing plans, or changes therein, of the Project.

 

6.             Costs and Payments.

 

6.1.          It is agreed to and understood by the partiesthat the University shall be reimbursed for all costs incurred in connectionwith the Project up to the amount of **$ 25,480** (the “ProjectCost”) as established by the budget in Exhibit B which is incorporatedherein. It is estimated that the amount designated as the Project Cost issufficient to support Project expenses.

 

6.2.          The Sponsor shall not be liable for anypayment in excess of the Project Cost unless this Agreement is modified inwriting. Within ninety (90) days after the termination of this Agreement theUniversity shall submit a final financial report setting forth costs incurred.The report shall be accompanied by a check in the amount, if any, of the excessof funds advanced over costs incurred.

 

6.3.          All checks shall be made payable to CornellUniversity and sent to the address specified in Article 18, Notices*.* Payment shall be made by the Sponsor according to thefollowing schedule: Quarterly payments **($6,370.)** tobegin upon execution of this Agreement with the final payment being made uponreceipt of the final written report.

 

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6.4           University shall use the funds providedhereunder solely in support of activities by the Principal Investigator insupport of the Project. During the term of this Agreement, University shall notuse funds provided by a commercial entity, other than Sponsor,to support the Principal Investigator’s activities under this Agreement orwithin the scope of the Project if the use of such funds would provide any thirdparty with any rights in any Intellectual Property.

 

7.             Equipment. Title to any equipment purchased or manufactured in the performance ofthe Project shall vest in the University.

 

8.             Use of Name. Neither party shall make use of thisAgreement, or use the name of the other party, nor that of any member of theother’s staff, in any publicity, advertising, or news release without the priorwritten approval of the other party. This shall not include internal documentsavailable to the public that identify the existence of this agreement.

 

9.             Publications.

 

9.1.          The Sponsor recognizes that under University policy, the Universityshall have the right, at its discretion, to release information or to publishany material resulting from the Project. The University shall furnish theSponsor with a copy of any proposed publication thirty (30) days in advance ofthe proposed publication date. The Sponsor may request the University to delay releaseof such proposed publication for a maximum of an additional thirty (30) days inorder to protect Intellectual Property, or Confidential or Proprietary Datadescribed therein. Such delay shall not be imposed on the filing of any studentthesis or dissertation.

 

9.2.          The Sponsor will be given full credit and acknowledgment for thesupport provided to the University in any publication resulting from theProject.

 

10.           Intellectual Property.

 

10.1.        All rights and title to University Intellectual Property shall vest inthe University.

 

10.2.        All rights and title to Sponsor Intellectual Property shall vest in theSponsor.

 

10.3.        Allrights and title to JointlyOwned Intellectual Property shall vest jointly in the University and in theSponsor.

 

10.4.        Universityand Sponsor shall promptly provide a complete written disclosure to each otherof any Intellectual Property. The Sponsor shall, upon reviewing the disclosure,determine whether to request the University to file and prosecute any patentapplication, domestic or foreign, or application for other protection directedto University Intellectual Property or to Jointly

 

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Owned Intellectual Property described in such disclosure. The Sponsorshall bear all costs incurred in connection with such preparation, filing,prosecution, and maintenance of U.S. and foreign applications. The Sponsorshall cooperate with the University to assure that such applications willcover, to the best of the Sponsor’s knowledge, all items of commercial interestand importance. While the University shall be responsible for making decisionsregarding scope and content of applications to be filed and prosecuted, theSponsor shall be given an opportunity to review and provide input thereto. TheUniversity shall keep the Sponsor advised as to all developments with respectto such applications and shall promptly supply to the Sponsor copies of allpapers received and filed in connection with the prosecution thereof insufficient time for the Sponsor to comment.

 

10.5.        Universityhereby grants Sponsor a first option to obtain a worldwide, royalty-bearing,exclusive license (with the right to sublicense) under its commercial rights inany University Intellectual Property and Jointly Owned Intellectual Property(the “Option Right”). Sponsor may exercise the Option Right with respect to aparticular Intellectual Property by written notice to University not later thanthirty (30) days after the disclosureto Sponsor of the relevant Intellectual Property (the “Option Period”).”);provided, however, that, notwithstanding the foregoing, Sponsor may exercisethe Option Right for the invention disclosure entitled “Use of MajorHistocompatibility Complex (MHC) Compatible Pregnancies or Down Regulation ofTrophoblast MHC...” , as described in that certain letter dated June 22,2000 (Ref. No. CRF D-2647 – Hill et al.) from Richard S. Cahoon, CornellResearch Foundation, Inc. Vice President and Associate Director Patents andTechnology Marketing, to Dr. Jose B. Cibelli of Advanced Cell Technology, Inc.,at any time during the term of this Agreement. If Sponsor elects not toexercise the Option Right, or fails to exercise the Option Right during theOption Period, University shall be free to license its commercial rights underthe relevant Intellectual Property to any third party. If Sponsor does elect toexercise the Option Right, University and Sponsor shall negotiate in good faitha license agreement containing commercially reasonable terms and conditions. IfUniversity and Sponsor are unable to reach agreement within six (6) monthsafter Sponsor exercised the Option Right (the “Negotiation Period”), Universitymay offer its commercial rights in the relevant Intellectual Property to anythird parties; provided, however, that for a period of one (1) year after theNegotiation Period expires, University may only offer such rights to third partieson terms and conditions that are not more favorable than the last offer made byUniversity to Sponsor, unless University first provides Sponsor with writtennotice of the more favorable offer and Sponsor either (i) declines inwriting to accept the offer or (ii) fails to respond to the offer withinthirty (30) days after receiving such notice.

 

10.6.        ShouldSponsor not elect to pay for protection of University Intellectual Property orthe University’s rights in any Jointly Owned Intellectual Property, Sponsorshall have no further rights in such Intellectual Property.

 

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10.7.        To the extent that any Intellectual Property has been partially fundedby the federal government, this Agreement and the grant of any rights in suchIntellectual Property is subject to and governed by federal law as set forth in35 U.S.C. §§ 201-211, and the regulations promulgated there under, asamended, or any successor statutes or regulations. To the extent that anyIntellectual Property has been partially funded by a non-profit organization orstate or local agency, this Agreement and the grant of any rights in suchIntellectual Property is subject to and governed by the terms and conditions ofthe applicable research grant. At the request of Sponsor, University shall makeavailable to Sponsor the terms and conditions of any research grants that willpartially fund the Project.

 

11.           Termination for Convenience. This Agreement may be terminated at anytime by either party giving the other party at least sixty (60) days written noticeof termination. In the event of termination by the Sponsor, the University willbe reimbursed for all expenses and non-cancelable commitments incurred in accordancewith the terms of this Agreement prior to the date of the termination notice.In no event shall the liability of the Sponsor exceed the Project Cost.

 

12.           Independent Contractor.

 

12.1.        In the performance of the Project the University shall be deemed to bean independent contractor and, as such, the University shall not be entitled toany benefits applicable to employees of the Sponsor.

 

12.2.        Neither party is authorized or empowered to act as an agent for theother for any purpose and shall not on behalf of the other enter into anycontract, warranty, or representation as to any matter. Neither shall be boundby the acts or conduct of the other.

 

13.           Insurance.

 

13.1.        The University warrants and represents that the University has adequateliability insurance, such protection being applicable to officers, employees, andagents while acting within the scope of their employment by the University, andthat the University has no liability protection for any other person.

 

13.2.        Each party hereby assumes any and all risks of personal injury andproperty damage attributable to the negligent acts of that party and theofficers, employees, and agents thereof.

 

14.           Force Majeure. The University shall not be liable for anyfailure to perform as required by this Agreement to the extent such failure to performis reasonably beyond the University’s control, or by reason of any of thefollowing: labor disturbances or labor disputes of any kind, accidents, failureof any governmental

 

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approvalrequired for full performance, civil disorders or commotions, acts ofaggression, floods, earthquakes, acts of God, energy or other conservationmeasures, explosion, failure of utilities, mechanical breakdowns, materialshortages, disease or other such occurrences.

 

15.           Governing Law. This Agreement shall be governed andconstrued in accordance with the laws of the State of New York.

 

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

 

17.           Agreement Modification. Any agreement to change the terms of thisAgreement in any way shall be valid only if the change is made in writing andapproved by mutual agreement of authorized representatives of the partieshereto.

 

18.           Notices. Notices, invoices, communications, and payments hereunder shall be deemedmade if given by registered or certified envelope, postage prepaid and addressedto the party to receive such notice, invoice, or communication at the addressgiven below or such other address as may hereafter be designated by notice inwriting.

 
| If to the  Sponsor:                  |                                 |
|--------------------------------------|--------------------------------------|
| Contractual:                         | Michael D.  West Ph.D.               |
|                                 | C.E.O.                               |
|                                 | Advanced  Cell Technology, Inc. |
|                                 | One  Innovation Drive                |
|                                 | Worcester,  MA. 01605                |
|                                 | Phone: (508) 756-1212                |
|                                 | Fax: (508) 756-0931                  |
|                                 |                                 |
| Technical:                           | Jose Cibelli DVM, Ph.D.              |
|                                 | VP  of Research                      |
|                                 | Advanced  Cell Technology, Inc. |
|                                 | One  Innovation Drive                |
|                                 | Worcester, MA. 01605                 |
|                                 | Phone: (508) 756-1212                |
|                                 | Fax:  (508) 756-0931                 |
|                                 |                                 |
| If to the  University:  Contractual: | Robin  L. Cyr                        |
|                                 | Sr.  Grant and Contract Officer      |
|                                 | Office  of Sponsored Programs        |
|                                 | 120  Day Hall                        |
|                                 | Cornell  University                  |

 

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|       | Ithaca,  New York 14853                   |
|------------|-------------------------------------------|
|       | Phone:  (607) 255-1050                    |
|       | Fax:  (607) 255-1659                      |
|       | Email:  rlc21@cornell.edu                 |
|       |                                      |
| Payments:  | Cornell University                        |
|       | Sponsored Funds Accounting                |
|       | P.O. Box 22                               |
|       | Ithaca, NY 14851-0022                     |
|       |                                      |
| Technical: | Dr. Jonathan  R. Hill                |
|       | Section of  Theriogenology           |
|       | Department  of Clinical Sciences (Box 34) |
|       | Veterinary  Research Tower VRT 7-002      |
|       | College  of Veterinary Medicine           |
|       | Cornell University                        |
|       | Ithaca, NY 14853-6401                     |
|       | Phone: (607) 253-3091                     |
|       | Fax:  (607) 253-3531                      |
|       | Email:  jrh35@cornell.edu                 |

 

19.           SpecialProvisions.

 

Proprietaryor Confidential Data.The Confidentiality Agreement between the parties dated August 3, 2000, a copyof which is attached hereto as Exhibit C, shall govern the disclosure ofeach party’s proprietary or confidential information in connection with orduring the term of this Agreement.

 

This Agreement is thecomplete agreement of the Sponsor and Cornell and supersedes all priorunderstandings regarding the Project.

 

IN WITNESS WHEREOF, theparties have caused these presents to be executed in duplicate on the datesindicated below.

 
| **CORNELL  UNIVERSITY**         | **ADVANCED  CELL TECHNOLOGY** |
|---------------------------------|-------------------------------|
| ** **                      | ** **                    |
|                            |                          |
| /s/ Robin L. Cyr                |                          | /s/ Michael D. West |   |
| Robin L. Cyr                    | Michael D. West Ph.D.         |
| Sr. Grant and Contract  Officer | C.E.O.                        |
|                            |                          |
|                            |                          |
| 8/9/00                          |                          | 8-11-00 |   |
| Date                            | Date                          |
|                            |                          |
|                            |                          |

 

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