Document:

exv10w31

Exhibit 10.31

August 6, 2009

Ken Stratton

774 Knoll Drive

San Carlos, CA 94070

Re: Amendment to Existing Employment Agreement

Dear Ken:

I am pleased to amend your existing Employment Agreement to include the following provision:

If your employment with StemCells is involuntarily terminated without cause at any time, you will
be provided with salary continuation and benefits continuation under COBRA from the date of
termination until the date six (6) months after the effective date of termination equal to the
salary which you were receiving at the time of such termination; payments shall be paid in
accordance with the Company’s standard payroll practices upon the Company’s receipt of a signed
general release of any claims, whether known or unknown, against the Company and its agents.

In the event of termination associated with a change of control, you will be provided with salary
continuation and benefits continuation under COBRA from the date of termination until the date
twelve (12) months after the effective date of termination equal to the salary which you were
receiving at the time of such termination; payments shall be paid in accordance with the Company’s
standard payroll practices upon the Company’s receipt of a signed general release of any claims,
whether known or unknown, against the Company and its agents. Additionally, termination associated
with a change of control will also trigger immediate vesting of any unvested stock options and any
other stock award held by you on the date of termination.

If your employment is terminated for cause or you choose to resign without good cause, you would
not be entitled to any severance payments or other benefits.

Your contributions and efforts over the past year have helped move the Company closer to our vision
of being the number one stem cell company in the world. Thank you for your continued support!

Regards,

/s/ Martin McGlynn

Martin McGlynn

3155
Porter Dr. • Palo Alto, CA 94304

(650) 475-3100 • (650) 475-3101 FAXexv10w32

Exhibit 10.32

BETWEEN

UNIVERSITY OF EDINBURGH

(“the Licensor”)

- and -

STEM CELL SCIENCES LIMITED

(formerly known as STEM CELL SCIENCES PTY LTD)

ACN 063 293 130

(“the Licensee”)

AGREEMENT

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	 	1.	 	 	DEFINITIONS AND INTERPRETATIONS	 	 	1	 
	 	 	 	 	1.1

	 	Definitions
	 	 	1	 
	 	 	 	 	1.2

	 	Interpretation
	 	 	5	 
	 	2.	 	 	GRANT OF LICENCE	 	 	5	 
	 	 	 	 	2.1

	 	Exclusive Licence to Licensee
	 	 	5	 
	 	 	 	 	2.2

	 	Notification and Copies of Sub-licences
	 	 	5	 
	 	 	 	 	2.3

	 	Contents of Sub-licences
	 	 	6	 
	 	 	 	 	2.4

	 	Exploitation of Licence
	 	 	6	 
	 	 	 	 	2.5

	 	Licensor’s Acknowledgement
	 	 	6	 
	 	3.	 	 	ROYALTY	 	 	6	 
	 	 	 	 	3.1

	 	Royalty
	 	 	6	 
	 	 	 	 	3.2

	 	Royalty Stacking
	 	 	6	 
	 	 	 	 	3.3

	 	Time of Computing Royalty
	 	 	8	 
	 	 	 	 	3.4

	 	Payment of Royalty
	 	 	8	 
	 	 	 	 	3.5

	 	Currency and Exchange Rate
	 	 	8	 
	 	 	 	 	3.6

	 	Taxation on Royalties
	 	 	8	 
	 	 	 	 	3.7

	 	Statements with Royalties
	 	 	8	 
	 	 	 	 	3.8

	 	Auditing of Statements
	 	 	9	 
	 	 	 	 	3.9

	 	Records
	 	 	9	 
	 	 	 	 	3.10

	 	Auditing of Records
	 	 	9	 
	 	 	 	 	3.11

	 	Auditing of Sub-licences Records
	 	 	9	 
	 	 	 	 	3.12

	 	Use of Royalties by Licensor
	 	 	9	 
	 	 	 	 	3.13

	 	[****]
	 	 	10	 
	 	 	 	 	3.14

	 	Licensee’s Warranty
	 	 	10	 
	 	4.	 	 	MINIMUM PERFORMANCE REQUIREMENTS	 	 	10	 
	 	 	 	 	4.1

	 	Royalty Guarantee
	 	 	10	 
	 	5.	 	 	PATENT APPLICATIONS	 	 	11	 
	 	 	 	 	5.1

	 	Patent Prosecution
	 	 	11	 

i

[****]
Certain information has been omitted and filed separately with the
Commission.  Confidential treatment has been requested with respect
to the omitted portions.

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	 	 	 	 	5.2

	 	Patents in name of Licensor
	 	 	11	 
	 	 	 	 	5.3

	 	Due Diligence in Prosecuting Applications
	 	 	11	 
	 	 	 	 	5.4

	 	Costs of Patent Prosecution
	 	 	11	 
	 	 	 	 	5.5

	 	Parties to Assist In Prosecution
	 	 	11	 
	 	6.	 	 	REGISTRATION	 	 	12	 
	 	 	 	 	6.1

	 	Registration of Licensee
	 	 	12	 
	 	 	 	 	6.2

	 	Cost of Registration
	 	 	12	 
	 	7.	 	 	CONSULTATION AND CO-OPERATION	 	 	12	 
	 	 	 	 	7.1

	 	Project consultation
	 	 	12	 
	 	 	 	 	7.2

	 	Co-operation generally
	 	 	12	 
	 	8.	 	 	ADDITIONAL LICENCES	 	 	12	 
	 	 	 	 	8.1

	 	Licensee’s Enhancements Property of Licensee
	 	 	12	 
	 	 	 	 	8.2

	 	Non- Exclusive Licenses to Licensor
	 	 	13	 
	 	 	 	 	8.3

	 	Revenues from third parties
	 	 	13	 
	 	9.	 	 	STANDARDS OF MANUFACTURE AND LABELLING	 	 	13	 
	 	 	 	 	9.1

	 	Compliance with Standards
	 	 	13	 
	 	 	 	 	9.2

	 	Indemnity
	 	 	13	 
	 	 	 	 	9.3

	 	Insurance
	 	 	13	 
	 	10.	 	 	SECRECY OBLIGATIONS	 	 	13	 
	 	 	 	 	10.1

	 	Confidentiality
	 	 	13	 
	 	 	 	 	10.2

	 	Exceptions
	 	 	14	 
	 	11.	 	 	LICENSOR’S WARRANTIES	 	 	14	 
	 	 	 	 	11.1

	 	Warranties
	 	 	14	 
	 	 	 	 	11.2

	 	Indemnity
	 	 	15	 
	 	12.	 	 	FAILURE TO GRANT OR SUBSEQUENT REVOCATION OF PATENT	 	 	15	 
	 	 	 	 	12.1

	 	Royalties to be Reduced
	 	 	15	 
	 	 	 	 	12.2

	 	Reduction of Royalty Guarantee
	 	 	15	 
	 	13.	 	 	PATENT INFRINGEMENT	 	 	16	 
	 	 	 	 	13.1

	 	Licensee to take Infringement Action
	 	 	16	 
	 	 	 	 	13.2

	 	Licensee to Notify Licensor
	 	 	16	 

ii

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page
	 	 	 	 	13.3

	 	Licensor to Assist Licensee
	 	 	16	 
	 	 	 	 	13.4

	 	Licensee to Indemnify Licensor
	 	 	16	 
	 	 	 	 	13.5

	 	Proceeds
	 	 	16	 
	 	14.	 	 	TERMINATION	 	 	17	 
	 	 	 	 	14.1

	 	Termination by Licensor
	 	 	17	 
	 	 	 	 	14.2

	 	Termination by Licensee
	 	 	17	 
	 	15.	 	 	EFFECTS OF TERMINATION	 	 	18	 
	 	 	 	 	15.1

	 	Effects of Termination
	 	 	18	 
	 	 	 	 	15.2

	 	Accrued Rights
	 	 	18	 
	 	16.	 	 	GENERAL	 	 	18	 
	 	 	 	 	16.1

	 	Waiver
	 	 	18	 
	 	 	 	 	16.2

	 	Entire Agreement
	 	 	18	 
	 	 	 	 	16.3

	 	Assignment
	 	 	19	 
	 	 	 	 	16.4

	 	Applicable Law
	 	 	19	 
	 	 	 	 	16.5

	 	Amendments
	 	 	19	 
	 	 	 	 	16.6

	 	Severability
	 	 	19	 
	 	 	 	 	16.7

	 	Notices
	 	 	19	 
	 	 	 	 	16.8

	 	Further Agreements
	 	 	20	 
	 	 	 	 	16.9

	 	Changes
	 	 	20	 

iii

 

THIS AGREEMENT is made on the 31st day of January 2006.

	 	 	 
	BETWEEN:

	 	UNIVERSITY OF EDINBURGH operating through its INSTITUTE FOR STEM
CELL RESEARCH (formerly the CENTRE FOR GENOME RESEARCH), of The
Roger Land Building, King’s Building’s, West Mains Road,
Edinburgh EH9 3JQ, United Kingdom (the “Licensor”) of the first
part
	 
	 	 
	AND:

	 	STEM CELL SCIENCES LIMITED (formerly known as STEM CELL SCIENCES
PTY LTD) ACN 063 293 130 of 1st Floor, 28 Riddell
Parade, Elsternwick, 3185, Australia (the “Licensee”) of the
second part.

BACKGROUND

	(A)	 	Under the Option Agreement, the Licensor granted to Dr. Peter Scott Mountford an option for a
licence under the Original Patent Applications.
	 
	(B)	 	Dr. Peter Scott Mountford, with the consent of the Licensor, assigned his rights and benefits
under the Option Agreement to the Licensee in accordance with the terms of the Option
Agreement.
	 
	(C)	 	The Licensee then validly exercised the option granted pursuant to the Option Agreement and
assigned to it and accordingly, on 31 March 1994, the Licensor and the Licensee entered into
the 1994 Agreement.
	 
	(D)	 	The Licensor and the Licensee have agreed to vary the terms of the 1994 Agreement in certain
respects, including by the grant of a licence to use certain additional rights to the License.
Accordingly, the parties have agreed to vary the terms of the 1994 Agreement in accordance
with this Agreement, it being the intent of the parties that this Agreement will be effective
to replace the terms of the 1994 Agreement with effect from the Agreed Date, as identified
above.

NOW THE PARTIES AGREE AS follows:

	1.	 	DEFINITIONS AND INTERPRETATIONS
	 
	1.1	 	Definitions
	 
	 	 	In this Agreement and in the Background unless the context otherwise requires, the following
words and expressions have the following meanings:
	 
	 	 	“1994 Agreement” means the agreement entered into between the Licensor and the Licensee,
dated 31 March 1994, following the Licensee’s valid exercise of the option granted pursuant
to the Option Agreement, and pursuant to the terms of which the licensor licensed certain
rights to the Licensee.

 

 

	 	 	“Affiliate” means an entity that directly or indirectly controls or is controlled by or is
under common control with the Licensee (and for this purpose “control” shall mean (i)
holding a fifty per cent (50%) voting interest in the voting shares or capital stock of the
relevant entity (or such lesser percentage which is the maximum allowed to be owned by a
foreign corporation in a particular jurisdiction); or (ii) that the affairs of the relevant
entity are conducted in accordance with the wishes of the other entity as a result of the
holding of voting shares or capital stock, voting partnership shares or other similar
ownership medium or by virtue of powers conferred by the articles of association, by-laws,
constitution or any other document or agreement regulating the affairs of the relevant
entity), and in the case of the Licensee shall include Stem Cell Sciences KK and any Former
Affiliate.
	 
	 	 	“Agreed Date” means 31 January 2006.
	 
	 	 	“Centre” means the Institute for Stern Cell Research (formerly the Centre for Genome
Research) of the University of Edinburgh and includes any person who becomes, in whole or in
part, its successors, substitute or assignee (which includes a person taking by way of
novation).
	 
	 	 	“Confidential Information” means all information, material and technology provided in any
form by either Party to the other under this Agreement and includes all drafts, copies,
exempts, notes and summaries thereof.
	 
	 	 	“Cross Licensed Rights” means any intellectual property rights granted to the Licensee or an
Affiliate of the Licensee by a sub-licensee in consideration of the grant of a Sub- licence
of the Licensed Rights.
	 
	 	 	“Existing Rights” means:

	 	(a)	 	the Patent Applications;
	 
	 	(b)	 	the Patents; and
	 
	 	(c)	 	Improvements, Inventions, Information and Know-how now possessed or invented,
developed or acquired by the Centre prior to Agreed Date.

	 	 	“Field” means the isolation and propagation of human and large animal stem cells including
the objectives of and the subject matter in or relating to the patent specifications
disclosed its the Original Patent Applications.
	 
	 	 	“Former Affiliate” means any entity which ceases to be an Affiliate.
	 
	 	 	“Information” means all secret processes, formulas and technical information relating to the
Field but not included in the patent specifications of the Patents.
	 
	 	 	“Inventions” means and includes all patentable and unpatentable inventions relating to the
Field other than the inventions included in the patent specifications of the Patents or the
Patent Applications.

2

 

	 	 	“Improvements” means any enhancement, modification, development, alteration or technical
advance in, of, or relating to any Patent, Patent Application, Invention, Information or
Know-how relating to the Field.
	 
	 	 	“Know-how” means all the expertise, practice, experience, skill and technical knowledge
relating to the Field.
	 
	 	 	“Licensed Rights” means the Existing Rights and the Project Results;
	 
	 	 	“Net Sales Price” means the arms length net selling price of gross invoiced sales of the
Products less all discounts, allowances, transportation charges, packaging costs, insurance
and taxes directly based on sale and/or time of payment.
	 
	 	 	“Option Agreement” means the option agreement dated 24 February 1994 between the Licensor
and Dr. Peter Mountford.
	 
	 	 	“Original Patent Applications” means (i) Patent Application GB 9308271.7 relating to the
invention of Peter Mountford and Austin Smith, Expression Vectors for In Vitro Derivation of
Stem Cells, and (ii) Patent Application GB 9401011.3 relating to the invention of Peter
Mountford, Austin Smith and Richard Lathe, Expression of Heterogonous Genes.
	 
	 	 	“Parties” means each of the University of Edinburgh and Stem Cell Sciences Limited and
“Party” means either of the University of Edinburgh and Stem Cell Sciences Limited.
	 
	 	 	“Patent Applications” means the patent applications, short particulars of which are given in
Schedule 1 and any divisions, continuation, continuation in part, supplemental disclosure
and reissues of any of them.
	 
	 	 	“Patent Rights” means patent applications and patents and any divisions, continuation,
continuation in part, supplemental disclosure and reissues of any of them.
	 
	 	 	“Patents” means the granted patents, short particulars of which are given in Schedule 1, all
present and future patents issued in respect of any Patent Application and any divisions,
continuation, continuation in part, supplemental disclosure and reissues of any of them.
	 
	 	 	“Product” means any product or process sold by or on behalf of the Licensee, by any
Affiliate of the Licensee under a Sub-licence, which is an application of or incorporates;

	 	(a)	 	one or more claims of a Patent, Patent Application, Project Patent or Project
Application; and/or
	 
	 	(b)	 	any Cross Licensed Rights.

	 	 	“Project Application” means all present and future patent applications and any divisions,
continuation, continuation in part, supplemental disclosure and reissues of any of them, in
respect of Project Results filed in any part of the Territory;

3

 

	 	 	“Project Patents” all present and future patents issued in respect of any Project
Applications and any divisions, continuation, continuation in part, supplemental disclosure
and reissues of any of them.
	 
	 	 	“Project Results” means (i) patentable or unpatentable inventions, secret processes,
formulae and technical information, expertise, practice, skill, technical knowledge, (ii)
Project Applications, or (iii) Project Patents invented or developed by the Centre, in the
conduct of the Projects (or any of them) which the University is not prevented by a Third
Party from making available to the Licensee under this Agreement by virtue of the terms and
conditions of funding imposed by the Third Party funding the relevant Project.
	 
	 	 	“Projects” means the programmes of scientific research listed in Schedule 2 (or any part
thereof) but only for so long as and to the extent that any programme (or any part thereof)
is being carried out by the Centre, together with such additional projects as the parties
may mutually agree in writing from time to time.
	 
	 	 	“Royalty” means the payments to be paid by the Licensee to the Licensor pursuant to Clause
3.1(a)(i) and 3.1(a)(ii).
	 
	 	 	“Royalty Period” means each period of one (1) year commencing on the date of this Agreement
or the anniversary of the date of this Agreement as the case may be or, if this Agreement is
terminated for any reason, the period commencing on the most recent anniversary of the date
of this Agreement and ending on the date of termination.
	 
	 	 	“Royalty Report” means the royalty examination report undertaken by PricewaterhouseCoopers
LLP dated 18 January 2006 (a copy of which has been provided to the Licensor and receipt of
which is hereby acknowledged by the Licensee).
	 
	 	 	“Sub-licence” means:

	 	(a)	 	any sub-licence of the Licensed Rights granted by the Licensee, or granted by
sub-licensee of the Licensee under a Sub-licence, pursuant to Clause 2.1(b); and
	 
	 	(b)	 	any sub-license of Cross Licensed Rights granted by the Licensee or an
Affiliate of the Licensee (which sub-license may also comprise the grant of a
sub-licence of the Licensed Rights).

	 	 	“Term” means the period commencing on 31 March, 1994 and concluding on the earlier of the
date on which the last of the Patents expires or the date on which this Agreement is
terminated pursuant to Clause 14, whichever is earlier.
	 
	 	 	“Territory” means all the countries of the world and includes any one or more of any part of
those countries.
	 
	 	 	“Third Party” means any entity or person other than the Licensor and the Licensee.

4

 

	1.2	 	Interpretation
	 
	 	 	In this Agreement, unless the contrary intention appears:

	 	(a)	 	a reference to person will include a natural person, corporation, incorporated
association, statutory corporation, the Crown and any other type of legal entity; words
including singular number will include a plural number and vice versa; words including
a gender will include all other genders;
	 
	 	(b)	 	a reference in this Agreement to a statute or a section of a statute includes
all amendments to that statute or section passed in substitution for the statute or
section referred to or incorporating any of its provisions;
	 
	 	(c)	 	Clause headings have been inserted for the purpose of guidance only, and will
not be part of this Agreement;
	 
	 	(d)	 	a reference to a Clause, Recital or paragraph is a reference to a clause,
recital or paragraph of this Agreement;
	 
	 	(e)	 	a reference to a person includes that person’s personal representatives,
successors and permitted assigns; and
	 
	 	(f)	 	“Agreement” means this licence agreement.

	2.	 	GRANT OF LICENCE
	 
	2.1	 	Exclusive Licence to Licensee
	 
	 	 	In consideration of the payment of the Royalty the Licensor hereby grants to the Licensee
the following:

	 	(a)	 	an exclusive licence in the Territory for the Term to enjoy, commercialise and
exploit the Licensed Rights and to manufacture, have manufactured, use, market, sell
and have sold the Products; and
	 
	 	(b)	 	the right to grant sub-licences of any of the rights (including the right to
sub-licence) referred to in paragraph (a) of this Clause 2.1, provided that any such
sub-licence is on terms not inconsistent with the Licensor’s rights under this
Agreement.

	2.2	 	Notification and Copies of Sub-licences
	 
	 	 	The Licensee will notify the Licensor of the name and address of the sub-licensee promptly
upon the Licensee entering into a Sub-licence and provide to the Licensor a copy of that
Sublicence within thirty (30) days of receiving a copy of that Sub-licence from the relevant
sub-licensee.

5

 

	2.3	 	Contents of Sub-licences
	 
	 	 	The Licensee will ensure that:

	 	(a)	 	provisions with the effect of Clauses 3.7(a), 3.9, 3.10, 9 and 15.1; and
	 
	 	(b)	 	the provisions of Clause 10 with the necessary changes being made, are
incorporated in each Sub-licence.

	2.4	 	Exploitation of Licence
	 
	 	 	The Licensee at its expense will use its best endeavours to commercialise and exploit the
Licensed Rights and to manufacture, have manufactured, use, market and sell the Products or
to appoint sub-licensees for the purpose of such commercialisation and exploitation.
	 
	2.5	 	Licensor’s Acknowledgement
	 
	 	 	Notwithstanding Clause 2.4, the Licensor acknowledges that not all of the Licensed Rights
are as at the date of this Agreement at a stage which are capable of commercialisation or
exploitation. The Licensor further acknowledges that it may be necessary for the Licensee
to conduct research in relation to some of the Licensed Rights before the Licensee can
fulfil its obligations under Clause 2.4.
	 
	3.	 	ROYALTY
	 
	3.1	 	Royalty

	 	(a)	 	In consideration of the licences granted in Clause 2, but subject always to
Clauses 3.2 and 4, the Licensee must pay to the Licensor:

	 	(i)	 	an amount equal to [****] of the Net Sales Price of any Product
sold by the Licensee or any Affiliate under a Sub-licence on or after the
Agreed Date; and
	 
	 	(ii)	 	an amount equal to [****].

	 	(b)	 	The Licensee will use all reasonable endeavours to ensure that Products are
sold, leased, hired or otherwise disposed of at normal commercial rates.

	3.2	 	Royalty Stacking

	 	(a)	 	Where in order to manufacture, use, market or sell Products it is legally necessary
for the Licensee to also have a licence from a Third Party (other than an Affiliate)
under any Patent Rights and by reason of an agreement with such Third Party a
royalty on the Net Sales Price (or similarly defined amount) is payable to such
Third Party, [****]:

	 	(i)	 	[****]

6

 

	 	(ii)	 	the Licensee shall make available to the Licensor appropriate
documentary and other evidence to verify the amount of royalties being paid
under the licences giving rise to a reduction of the Royalty payable to the
Licensor under Clause 3.1(a)(i);
	 
	 	(iii)	 	the foregoing shall apply only if any Third Party from whom it
is legally necessary for the Licensee to obtain a licence in order to
manufacture, sell, use or otherwise dispose of the Products and with whom the
licensee enters into an agreement following the Agreed Date agrees that the
provisions of equivalent effect to this Clause 3.2(a) apply in respect of the
sums payable to such Third Party; and
	 
	 	(iv)	 	in calculating whether the Total Royalty exceeds the Royalty
Cap for the purposes of this Clause 3.2(a), any royalties payable to
sub-licensees in respect of the manufacture, use, marketing or sale of Products
containing Cross Licensed Rights are to be disregarded.

	 	(b)	 	Where the Licensed Rights and/or Cross Licensed Rights are sub-licensed by the
Licensee (or any Affiliate under a Sub-licence) together with other patents, patent
applications, know-how, technology, material and/or resources owned by or under the
control of the Licensee (the “Other Technology”) and the relevant Sub-licence does not
apportion the amounts to be paid under that Sub-licence between the Licensed Rights
and/or the Cross Licensed Rights (on the one hand) and the Other Technology being
licensed or sub-licensed to the sub-licensee (on the other hand), the amount received
from the sub-licensee under the relevant Sub-licence in respect of exploitation of the
Licensed Rights and/or the Cross Licensed Rights shall for the purposes of calculating
the amounts payable to the Licensor under Clause 3.1(a)(ii) be deemed to be such
proportion of the total consideration payable thereunder as the parties shall agree is
fair and reasonable taking into account the relative values of the licensed Rights
and/or the Cross Licensed Rights (on the one hand) and the Other Technology being
sub-licensed or licensed to the relevant sublicence (on the other hand). If at any
time a dispute arises under this Clause 3.2(b) (including without limitation a failure
to reach agreement in relation to the relative values of the Licensed Rights and/or the
Cross Licensed Rights (on the one hand) and the Other Technology being sub-licensed or
licensed to the relevant sub-licensee (on the other hand)) and the parties are not able
to resolve such dispute within thirty (30) days of the dispute first arising, either
party may elect by serving a written notice on the other party to refer such dispute
for determination to the Principal of the Licensor and the Chief Executive Officer of
the Licensee.
	 
	 	(c)	 	The Licensee will use all reasonable endeavours to ensure that the Licensed
Rights and the Cross Licensed Rights are sub-licensed by the Licensee (or any Affiliate
under a Sub-licence) at normal commercial rates.

7

 

	3.3	 	Time of Computing Royalty
	 
	 	 	The Royalty for each year will be computed at the end of each Royalty Period.
	 
	3.4	 	Payment of Royalty
	 
	 	 	Subject to Clause 3.5, the Licensee will pay the Royalty for each Royalty Period free of all
taxes or charges within thirty (30) days of the end of the Royalty Period.
	 
	3.5	 	Currency and Exchange Rate
	 
	 	 	Each payment provided for in Clause 3.1 shall be paid in pounds sterling and the rate of
exchange will be that prevailing between the Australian dollar and the pound sterling
published in the Australian Financial Review on the last day of the relevant Royalty Period.
	 
	3.6	 	Taxation on Royalties

	 	(a)	 	All income taxes levied in accordance with the tax laws in specific countries
within the Territory on the Royalty payments to be made by the Licensee under this
Agreement shall be borne by the Licensor.
	 
	 	(b)	 	The Licensee will pay such taxes to the competent taxation office on the
Licensor’s behalf, it being agreed and understood that the Licensor authorises the
Licensee to withhold such taxes from Royalty payments.
	 
	 	(c)	 	The Licensee will furnish the Licensor with tax receipts or other certificates
issued by the competent taxation office showing the payment of the income taxes.

	3.7	 	Statements with Royalties
	 
	 	 	The Licensee will:

	 	(a)	 	with each Royalty payment under Clause 3.1(a)(i) and Clause 4.1 provide the
Licensor with a statement including the following information:

	 	(i)	 	the number of Products manufactured and/or sold during the
Royalty Period;
	 
	 	(ii)	 	the Net Sales Price of each of the Products sold during the
Royalty Period;
	 
	 	(iii)	 	the manner in which the Net Sales Price is calculated
including discounts, transportation charges, purchasing costs, insurance and
taxes; and
	 
	 	(iv)	 	if Clause 3.2(a) applies, all papers, documents, information
and other evidence reasonably requested by the Licensor to verify the reduced
Royalty payable; and

	 	(b)	 	with each Royalty payment under Clause 3.1(a)(ii) provide to the Licensor:

8

 

	 	(i)	 	copies of all statements delivered to the Licensee by its
sub-licensees in respect of royalty payments made to the Licensee under any
Sub-licence; and
	 
	 	(ii)	 	if Clause 3.2(b) applies, all papers, documents, information
and other evidence reasonably requested by the Licensor to verify the reduced
Royalty payable.

	3.8	 	Auditing of Statements
	 
	 	 	Any statement provided under Clause 3.7 will, if required by the Licensor, be certified as
correct by the auditor of the Licensee, or if the Licensee does not have an auditor, by a
person approved by the Licensor for this purpose.
	 
	3.9	 	Records
	 
	 	 	The Licensee shall maintain for a period of seven (7) years in a manner approved by the
Licensor separate and accurate records and accounts of the manufacture and sale of the
Products, the Net Sales Price at which the Products are sold and any other information
reasonably required by the Licensor relevant to the Products manufactured and sold and the
determination of Net Sales Price and, if applicable, the reduced Royalty payable pursuant to
Clause 3.2. Such separate and accurate records and accounts shall be in sufficient detail
so that the Licensor need not refer to the other records and accounts of the Licensee.
	 
	3.10	 	Auditing of Records
	 
	 	 	The Licensee will upon reasonable notice and during ordinary business hours, permit and give
all reasonable assistance to an accountant or auditor of the Licensor to inspect, audit and
copy on a confidential basis all or any records required to be maintained by the Licensee
under this Clause.
	 
	3.11	 	Auditing of Sub-licences Records
	 
	 	 	The Licensee will, if requested by the Licensor, inspect, audit and copy records kept by any
sub-licensee pursuant to any Sub-licence for the purpose of verifying Royalty payments and,
if applicable, the reduced Royalty payable pursuant to Clause 3.2.
	 
	3.12	 	Use of Royalties by Licensor
	 
	 	 	The Licensee acknowledges that the licensor shall be free to implement any policies it may
have for an equitable sharing of any Royalties paid to it with those inventors responsible
for generating the intellectual property which lead to the Royalty being paid. The balance
of any such Royalties not so distributed shall be applied by the Licensor to further its
aims and objectives.

9

 

	3.13	 	[****]
	 
	3.14	 	Licensee’s Warranty
	 
	 	 	The Licensee hereby represents, warrants and undertakes to the Licensor that:

	 	(a)	 	it has not knowingly withheld any papers, documents, information and/or other
evidence relevant to the undertaking of the Royalty Report; and
	 
	 	(b)	 	the papers, documents, information and other materials provided by the Licensee
to PricewaterhouseCoopers LLP in connection with its preparation of the Royalty Report
relating to Products sold by the Licensee (including information about the Net Sales
Prices of Products sold by the Licensee) and Sub-licences entered into by the Licensee
(including information provided by the Licensee about royalties, sub-licensing fees and
other payments paid to the Licensee pursuant to such Sub-licences) are to the best of
the knowledge and belief of the Licensee true, accurate, reliable and complete in all
material respects.

	4.	 	MINIMUM PERFORMANCE REQUIREMENTS
	 
	4.1	 	Royalty Guarantee
	 
	 	 	If for any Royalty Period the amount of Royalties paid to the Licensor under this Agreement
is:

	 	(i)	 	less than [****]; or
	 
	 	(ii)	 	if the Royalty Period is less than one year, less than the
proportion [****] which reflects the ratio of that royalty Period to one year,

	 	 	the Licensee will, within thirty (30) days of the end of the relevant Royalty Period, pay to
the Licensor the difference between the amount set down in paragraph (i) or (ii) of this
Clause 4.1 (as the case may be) and the amount of Royalties actually paid to the Licensor in
that Royalty Period.

10

 

	5.	 	PATENT APPLICATIONS
	 
	5.1	 	Patent Prosecution
	 
	 	 	For so long as the Licensee claims the exclusive license granted under Clause 2.1, the
Licensor and the Licensee will consult together on action to be taken with regard to filing
and the prosecution of Patent Applications and Project Applications in the Territory. The
Parties will decide between them which Party will be responsible for conducting the
prosecution of Patent Applications and Project Applications in each country within the
Territory in which Patent Applications and Project Applications have been or may be made.
	 
	5.2	 	Patents in name of Licensor
	 
	 	 	Unless otherwise agreed between the Parties or unless otherwise required by the legislation
of a particular country in which a Patent Application or Project Applications may be made,
all patents will, unless otherwise agreed in writing between the parties, be prosecuted in
the name of the Licensor and the Parties will make all reasonable efforts to ensure that all
documents and things are executed and done by the Parties or their employees, agents or
representatives to secure the grant of patent in the name of the Licensor.
	 
	5.3	 	Due Diligence in Prosecuting Applications
	 
	 	 	Each Party will use all reasonable efforts and exercise due diligence in prosecuting any
Patent Application and Project Application for which it may have responsibility under Clause
5.1 in full accordance with all the relevant laws and requirements of the country concerned
and each will keep the other informed of all official actions and responses arising out of
the prosecution of that Patent Application and Project Application.
	 
	5.4	 	Costs of Patent Prosecution
	 
	 	 	For so long as the Licensee retains the exclusive licence granted under Clause 2.1, the
Licensor will have the right to reimbursement of all expenses it may incur after the date of
this Agreement in connection with the prosecution of ally Patent Application, Patent,
Project Application and Project Patent in the Territory, unless otherwise agreed by the
parties in writing or the Licensee has previously notified the Licensor of the Licensee’s
objection to a course of action to which such expenditure may relate.
	 
	5.5	 	Parties to Assist In Prosecution
	 
	 	 	The Licensor and Licensee each agree to give the other all reasonable assistance in
prosecuting Patent Applications and Project Applications for which the other may be
responsible.

11

 

	6.	 	REGISTRATION
	 
	6.1	 	Registration of Licensee
	 
	 	 	The Licensee may at any time during the currency of this Agreement request the Licensor to
grant or procure the registered patentee to grant to the Licensee formal licences in respect
of any of the Patents and Project Patents in a form that complies with the requirements of
law and public authorities in each part of the Territory to enable the Licensee at its
expense, to become duly registered as the Licensee under the Patents and Project Patents.
	 
	6.2	 	Cost of Registration
	 
	 	 	The Licensee hereby undertakes to bear all costs and expenses incurred in the grant and
registration of formal licences in respect of the Patents and Project Patents to the
Licensee pursuant to Clause 6.1.
	 
	7.	 	CONSULTATION AND CO-OPERATION
	 
	7.1	 	Project consultation
	 
	 	 	On and from the Agreed Date and during the conduct of the Projects the Parties will meet on
a regular basis (at least twice yearly), at a time and place to be mutually agreed between
the parties, to discuss progress with respect to the Projects. During the period
intervening between such meetings of the Parties in relation to the Projects, each Party
will use its reasonable endeavours to keep the other Party informed of any arising Project
Results as soon as reasonably practicable following the invention or discovery of any
Project Results relevant to any Project.
	 
	7.2	 	Co-operation generally
	 
	 	 	On and from the Agreed Date, the parties will co-operate in good faith with a view to
developing a mutually beneficial relationship between the parties on an ongoing basis.
	 
	8.	 	ADDITIONAL LICENCES
	 
	8.1	 	Licensee’s Enhancements Property of Licensee
	 
	 	 	All enhancements and improvements to the Licensed Rights originated, developed or invented
by the Licensee, and all unpatentable and patentable inventions, secret processes, formulae,
technical information, expertise, practice, experience, skill and technical knowledge
relating to the Field which is originated, developed or invented by the Licensee and which
the Licensee is entitled to own (the “Licensee’s technology”) will vest in and be the
property of the Licensee.

12

 

	8.2	 	Non- Exclusive Licenses to Licensor

	 	(a)	 	In consideration of the agreements of the Licensor in this Agreement, the
Licensee by this Agreement hereby grants to the Licensor, with effect from 31 March
1994 and for the duration of the Term: [****].

	8.3	 	Revenues from third parties
	 
	 	 	In the event that Licensor receives a request from a commercial entity regarding use of the
Licensed Rights, the Licensor shall make them aware of the nature of the terms of this
Agreement in advance of any research being conducted. In the event that such commercial
entity requires a licence to the Licensed Rights, the Licensor shall promptly advise the
relevant third party to contact Hugh Ilyine (or such replacement Chief Operating Officer of
the Licensee as may be notified to the Licensor in writing from time to time), of the
Licensee.
	 
	9.	 	STANDARDS OF MANUFACTURE AND LABELLING
	 
	9.1	 	Compliance with Standards
	 
	 	 	The Licensee will manufacture the Products so that each one meets the requirements and
specifications of any applicable standards set forth by the country and the part of the
Territory where the particular Product is to be sold and the Licensee shall not sell any
Products that do not meet such specifications and requirements.
	 
	9.2	 	Indemnity
	 
	 	 	The Licensee will keep the Licensor indemnified against all damages, costs or expenses,
including legal costs, in respect of all claims, demands, actions, proceedings or
prosecutions which may be brought, commenced or prosecuted against the Licensor in
consequence or relating to or arising out of the manufacture, sale or commercial utilisation
of the Products.
	 
	9.3	 	Insurance
	 
	 	 	In the event that such insurance is available at commercially reasonable rates, the Licensee
will at all times following first commercial sale of Product maintain and keep current in
respect of its manufacture and sale of the Products, product liability insurance obtained
from a reputable insurer and shall make available to the Licensor such policy for inspection
upon request by the Licensor.
	 
	10.	 	SECRECY OBLIGATIONS
	 
	10.1	 	Confidentiality
	 
	 	 	Subject to Clause 10.2 each Party undertakes to the other Party to maintain in confidence
all Confidential Information received from the other and to ensure that its employees,

13

 

	 	 	agents, contractors, sub-contractors, solicitors and other advisers keep such Confidential
Information confidential.
	 
	10.2	 	Exceptions
	 
	 	 	A Party (the “recipient”) may reveal Confidential Information of the other Party (the
“provider”) which the recipient establishes:

	 	(a)	 	if required by law to be revealed, provided that the recipient immediately
provides the provider of the requirement and takes lawful steps and permits the
provider to oppose or restrict such disclosure to preserve as far as possible the
confidentiality of the Confidential Information;
	 
	 	(b)	 	which is in or enters the public domain other than through a breach of this
Agreement; or
	 
	 	(c)	 	is revealed to a sub-licensee under a Sub-licence which complies in all
respects with the provisions of this Agreement including, without limitation, the
provisions of Clause 2.3; and
	 
	 	(d)	 	was known to the recipient before its disclosure by the provider; or
	 
	 	(e)	 	is furnished to the recipient by a Third Party legally entitled to furnish such
information and not under an obligation of confidentiality to the provider.

	11.	 	LICENSOR’S WARRANTIES
	 
	11.1	 	Warranties
	 
	 	 	The Licensor hereby represents, warrants and undertakes to the Licensee that:

	 	(a)	 	neither the execution of this Agreement, nor the performance by the Licensor of
its obligations will cause it to be in breach of any agreement to which it is a party
or is subject;
	 
	 	(b)	 	except as may otherwise be expressly notified to the Licensee in writing, the
Licensor has and for the duration of this Agreement will continue to have full right
and title to the Existing Rights;
	 
	 	(c)	 	the Licensor is entitled to make all Patent Applications which it has made, and
the Licensor has not made knowing use of any intellectual property or other rights of
any Third Party in the making of the Patent Applications;
	 
	 	(d)	 	all Patent Applications filed by the Licensor at the date of this Agreement
have to the best of the knowledge of the Licensor been made in the prescribed form and
in the prescribed manner;

14

 

	 	(e)	 	the Existing Rights include or will include all technology owned by or
registered in the name of the Licensor or to which the Licensor is beneficially
entitled in or relating to the Field and possessed, invented, developed or acquired by
or for the Centre; and
	 
	 	(f)	 	all Inventions, Information, Know-how and Improvements comprised in the
Existing Rights and supplied to the Licensee by the Licensor will be to the best of the
knowledge and belief of the Licensor true, accurate, reliable and up-to-date.

	11.2	 	Indemnity
	 
	 	 	The Licensor will indemnify the Licensee (including its employees, agents and
representatives) throughout the Term against all legal liability, and against the costs of
any claims or actions arising under this Agreement to the extent that that liability is
directly caused by negligent acts or by omissions of the Licensor in the carrying out of its
obligations under this Agreement or is caused by a breach of any warranty or representation
given by the Licensor under this Agreement.
	 
	12.	 	FAILURE TO GRANT OR SUBSEQUENT REVOCATION OF PATENT
	 
	12.1	 	Royalties to be Reduced
	 
	 	 	If as a result of the refusal to grant any Patent Application or the subsequent invalidity,
revocation or expiration of any Patent in any part of the Territory, the profitability of
the Licensee or any of the Licensee’s sub-licensees in that part of the Territory is
significantly and materially adversely affected with regard to the manufacture, use and sale
of Product: [****].

	12.2	 	Reduction of Royalty Guarantee
	 
	 	 	If the Royalty is reduced under Clause 12.1, there will be a corresponding reduction in the
amount required to be paid by the Licensee to the Licensor under Clause 4.1 and Clause 4.1
will be read accordingly.

15

 

	13.	 	PATENT INFRINGEMENT
	 
	13.1	 	Licensee to take Infringement Action
	 
	 	 	The Licensor appoints and constitutes the Licensee its agent and attorney during the Term,
to assert from time to time in the name of and for the account of the Licensor but for the
benefit of and at the expense of the Licensee whatever claims and rights the Licensor may
have arising from any actual or apparent infringement of any Patent, Patent Application,
Project Patent, Project Application or unauthorised use of any Project Results or Invention,
Information, Know-how or Improvement, and the Licensee will promptly assert and enforce all
such claims and rights and institute and prosecute an action against such infringement.
	 
	13.2	 	Licensee to Notify Licensor
	 
	 	 	In the event the Licensee asserts a claim or institutes an action as a result of an actual
or apparent infringement of any Patent, Patent Application, Project Patent, Project
Application or unauthorised use of any Project Results, Invention, Information, Know-how or
Improvement, the Licensee will immediately notify the Licensor.
	 
	13.3	 	Licensor to Assist Licensee
	 
	 	 	The Licensor will, if required by the Licensee and if necessary for the purposes of Clause
13.1, lend its name and will otherwise do all acts and things the Licensee may reasonably
require to assist the Licensee in performing its obligations under Clause 13.1. Without
limiting the preceding sentence, the Licensor will execute all documents and do all things
reasonably necessary to aid and co-operate in the prosecution of any action brought by the
Licensee pursuant to Clause 13.1.
	 
	13.4	 	Licensee to Indemnify Licensor
	 
	 	 	The Licensee will keep the Licensor indemnified from and against all loss costs and damage
suffered or incurred by the Licensor arising out of the Licensee exercising its powers and
performing its obligations under this Clause 13.
	 
	13.5	 	Proceeds
	 
	 	 	The proceeds from any judgement or settlement made by the Licensee in any action brought by
it pursuant to Clause 13.1 will be used first to reimburse the Licensee’s costs and expenses
incurred in the action, second, to reimburse the Licensor for all expenses incurred by it in
assisting the Licensee in prosecuting such action and the remainder shall be the Licensee’s.

16

 

	14.	 	TERMINATION
	 
	14.1	 	Termination by Licensor
	 
	 	 	The Licensor may at any time, immediately terminate this Agreement upon the happening of any
of the following events:

	 	(a)	 	If an order is made or a resolution passed for the winding up or the
dissolution without winding up of the Licensee, provided always that default shall not
be deemed to have occurred where the winding up is for the purpose of reconstruction or
amalgamation and the scheme for reconstruction or amalgamation has the Licensor’s prior
written consent (which consent shall not be unreasonably withheld);
	 
	 	(b)	 	If without the Licensor’s prior written consent the Licensee enters into an
arrangement reconstruction or composition with its creditors or any of them;
	 
	 	(c)	 	if a receiver is appointed to the Licensee;
	 
	 	(d)	 	if pursuant to the provisions of the Corporations Law the Licensee is placed
under voluntary administration, official management or an inspector is appointed to
investigate the affairs of the Licensee;
	 
	 	(e)	 	if without the Licensor’s prior written consent (which consent shall not be
unreasonably withheld) the Licensee assigns, transfers or parts with possession of any
material undertaking or assets to a person who is not an Affiliate of the Licensee,
otherwise than in the ordinary course of business of the Licensee;
	 
	 	(f)	 	if default is made by the Licensee in payment of a Royalty, and such default is
not remedied within thirty (30) days after notice specifying such default and requiring
the Licensee to remedy the same has been given by the Licensor to the Licensee; or
	 
	 	(g)	 	if default is made by the Licensee in performance or observance of any material
provision of this Agreement other than a default referred to in paragraph (f) of this
Clause 14.1 and where such default is capable of remedy such default is not remedied
within thirty (30) days after notice specifying such default and requiring the Licensee
to remedy the same has been given by the Licensor or the Licensee.

	14.2	 	Termination by Licensee
	 
	 	 	The Licensee may at any time terminate this Agreement by notice if material default is made
by the Licensor in the performance or observance of any provision of this Agreement, and
where such default is capable of remedy such default is not remedied within thirty (30) days
after notice specifying such default and requiring the Licensor to remedy the same has been
given by the Licensee to the Licensor.

17

 

	15.	 	EFFECTS OF TERMINATION
	 
	15.1	 	Effects of Termination
	 
	 	 	Upon termination of this Agreement for any reason whatsoever:

	 	(a)	 	each Party will return to the other Party all of the second mentioned Party’s
Confidential Information in the possession or under the control, or in the possession
or under the control of the servants or agents of the first mentioned Party;
	 
	 	(b)	 	subject to paragraph (c) of this Clause 15.1 neither Party will have any
further rights in relation to the other Party’s Confidential Information whether under
common or other law, statute or otherwise and, each Party will at its own expense
execute and deliver to the other Party such instructions and take all other action as
the other Party deems reasonably necessary to ensure the termination of any such
rights, and to vest every interest in the Confidential Information in the Party owning
that Confidential Information;
	 
	 	(c)	 	any Sub-license will remain in full force and effect provided the sub-licensee
is not in breach of the sub-license and performs all actions required by the Licensor
to effect a novation of the Sub-license to the Licensor;
	 
	 	(d)	 	Clauses 3.8, 9.2, 10, 15.2 and this Clause 15.1 will continue to bind the
Parties;
	 
	 	(e)	 	Clause 3 will continue to bind the Parties until the Licensor is satisfied that
all Royalties payable under this Agreement are paid.

	15.2	 	Accrued Rights
	 
	 	 	The termination of this Agreement will not affect any right of action which may have accrued
to either Party in respect of any breach prior to the date of such termination.
	 
	16.	 	GENERAL
	 
	16.1	 	Waiver
	 
	 	 	Any waiver or other indulgence by either Party in respect of any obligation of the other
Party under this Agreement will operate only if in writing and will apply only to the
specified instance, and will not constitute a waiver of or an indulgence in respect of any
other right or obligation under this Agreement.
	 
	16.2	 	Entire Agreement
	 
	 	 	This Agreement constitutes the whole and entire agreement between the Parties and replaces
all previous representations, understandings or arrangements given or made by the Parties,
whether oral or in writing.

18

 

	16.3	 	Assignment

	 	(a)	 	Subject to Clauses 16.3(b) and 16.3(c), neither Party will assign all or any of
its rights under this Agreement without the prior written consent of the other Party,
which consent must not he unreasonably withheld.
	 
	 	(b)	 	The Licensee may assign all or any of its rights and obligations under this
Agreement to an Affiliate (other than SCS KK) without the prior consent of the
Licensor.
	 
	 	(c)	 	The Licensee may assign all or any of its rights and obligations under this
Agreement to SCS KK with the prior written consent of the Licensor which consent must
not be unreasonably withheld.

	16.4	 	Applicable Law
	 
	 	 	This Agreement is governed by and to be construed according to the laws of the State of
Victoria, Australia and the Parties submit to the jurisdiction of that State.
	 
	16.5	 	Amendments
	 
	 	 	This Agreement may not be varied except in writing signed by the Parties.
	 
	16.6	 	Severability
	 
	 	 	If any provision of this Agreement is held by a court to be unlawful, invalid, unenforceable
or in conflict with any rule of law, statute, ordinance or regulation, the validity and
enforceability of the remaining provisions will not be thereby affected.
	 
	16.7	 	Notices
	 
	 	 	Any notice or other communication to be given under this Agreement:

	 	(a)	 	will be in writing;
	 
	 	(b)	 	may be given by hand, mail or facsimile;
	 
	 	(c)	 	will be given to the address of the recipient which is set out below unless the
recipient notifies the sender of another address to which notices or communications are
to be given:

	 	 	 
	Licensor:

	 	Edinburgh Research and Innovation Limited

University of Edinburgh
	 
	 	 
	Address:

	 	1-7 Roxburgh Street

Edinburgh EH8 9TA

United Kingdom
	 
	 	 
	Facsimile:

	 	(31) 651 4020

19

 

	 	 	 
	Licensee:

	 	Stem Cell Sciences Limited
	 
	 	 
	Address:

	 	1st Floor

Riddel Parade

Elsternwick

Victoria 3185

Australia
	 
	 	 
	Facsimile:

	 	(03) 347 3804

	 	(d)	 	if given by hand, will be deemed to have been given on the day it was so
delivered;
	 
	 	(e)	 	if given by mail, will be deemed to have been given seven clear business days
after being sent by pre-paid mail; and
	 
	 	(f)	 	if given by facsimile, will be deemed to have been given on the day on which
the facsimile is sent and the sender’s machine records that the transmission has been
received by the recipient’s facsimile machine and, if a hard copy of the relevant
notice is sent to the recipient by pre-paid mail within 24 hours of a successful
transmission report by the sender’s facsimile machine.

	16.8	 	Further Agreements
	 
	 	 	Each Party shall execute such agreements, deeds and documents and do or cause to be executed
or done all such acts and things as than be necessary to give effect to this Agreement.
	 
	16.9	 	Changes
	 
	 	 	All stamp duties and governmental charges arising out of or incidental to this Agreement
shall be the responsibility of and payable by the Licensee.

20

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00170-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00170-of-00352.parquet"}]]