Document:

License Agreement with Leland Stanford Jr. University

 EXHIBIT 10.13 
  
 [CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS AGREEMENT HAVE BEEN REDACTED AND HAVE BEEN SEPARATELY
FILED WITH THE COMMISSION.] 
  
 AGREEMENT 
  
 Effective as of May 5, 2000 (“Effective Date”), THE BOARD OF TRUSTEES OF THE LELAND
STANFORD JUNIOR UNIVERSITY, a body having corporate powers under the laws of the State of California (“STANFORD”), and Xenogen Corporation, a California corporation, having a principal place of business at 860 Atlantic Avenue, Alameda, CA
94501 (“LICENSEE”), agree as follows: 
  
 1. BACKGROUND 
  

	1.1	STANFORD has an assignment of the invention entitled “Using Light to Detect and Track Pathogens in Living Hosts”, from the laboratory of Dr. Christopher Contag
(“Invention[s]”), as described in Stanford Docket S94-044, and any Licensed Patent(s), as hereinafter defined, which may issue to such Invention(s). 

  

	1.2	STANFORD desires to have the Invention(s) perfected and marketed at the earliest possible time in order that products resulting therefrom may be available for public use and
benefit. 

  

	1.3	LICENSEE desires a license under said Invention(s), Licensed Materials and Licensed Patent(s) to develop, make, have made, use, import, offer for sale and sell Licensed Product(s)
in the Licensed Field of Use, and/or to sublicense said Invention(s), Licensed Materials and Licensed Patent(s) in the Licensed Field of Use. 

  

	1.4	LICENSEE and STANFORD have a prior agreement and amendments to the prior agreement for Invention(s), Licensed Materials and Licensed Patent(s). The parties acknowledge that pursuant
to the prior agreement, (i) LICENSEE has paid to STANFORD a noncreditable, nonrefundable license issue royalty of *** Dollars (***), and (ii) LICENSEE has paid to STANFORD *** for reimbursement of past patent expenses. The prior agreement and
amendments are superseded by this Agreement. 

  

	1.5	The Invention(s) was made in the course of research supported by one or more of the following: the American Foundation for AIDS Research, the National Institutes of Health, The
United States Public Health Service, and the Office of Naval Research. 

  
 2. DEFINITIONS 
  

	2.1	“Licensed Patent(s)” means any (i) U.S. patent application Serial Number 270,631 filed July 1, 1994 (issued on July 22, 1997 as U.S. Patent Number 5,650,135), (ii) all
divisions, substitutions, and continuations in whole or part of any of the preceding, (iii) all foreign patent applications corresponding to or claiming priority from (including International Application Number PCT/US95/15040 and all national
applications claiming priority therefrom), and (iv) all U.S. and foreign patents issuing on any of the preceding, including patents of addition, reexaminations, reissues and extensions. 

  
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	2.2	“Licensed Materials” means those biological materials listed in Exhibit A, and such other agreed materials as STANFORD may provide to LICENSEE during the term of this
Agreement, which shall be added to Exhibit A. 

  

	2.3	“Licensed Product(s)” means any product or part thereof in the Licensed Field of Use, the manufacture, use, or sale of which: 

  

	 	(a)	Is covered by a valid claim of an issued, unexpired Licensed Patent(s) directed to the Invention(s). A claim of an issued, unexpired Licensed Patent(s) shall be presumed to be valid
unless and until it has been held to be invalid or unenforceable by a final judgment of a court of competent jurisdiction from which no appeal can be or is taken or is disclaimed, or rejected or found invalid or unenforceable in a reissue
application or re- examination proceeding or otherwise; 

  

	 	(b)	Is covered by any claim being prosecuted in a pending application directed to the Invention(s); or 

  

	 	(c)	Incorporates any of the Licensed Materials. 

  

	2.4	“Net Sales” means the gross revenue derived by LICENSEE from Licensed Product(s), less the following items but only insofar as they actually pertain to the disposition of
such Licensed Product(s) by LICENSEE, are included in such gross revenue, and are separately billed: 

  

	 	(a)	Import, export, excise and sales taxes, and custom duties; 

  

	 	(b)	Costs of insurance, packing, and transportation from the place of manufacture to the customer’s premises or point of installation; 

  

	 	(c)	Costs of installation at the place of use; and 

  

	 	(d)	Credit for returns, allowances, or trades. 

  

	2.5	“Licensed Field of Use” means all uses. 

  

	2.6	“Licensed Territory” means worldwide. 

  

	2.7	“Exclusive” means that, subject to Article 4, STANFORD shall not grant further licenses in the Licensed Territory in the Licensed Field of Use. 

 
 3. GRANT 
  

	3.1	STANFORD hereby grants and LICENSEE hereby accepts an Exclusive license under the Licensed Patents and Licensed Materials to make, have made, import, use, lease, sell and offer for
sale and otherwise commercialize and exploit Licensed Products in the Licensed Territory, and practice any method process or procedure within the Licensed Patents in the Licensed Territory. 

  

	3.2	Said license is Exclusive, including the right to sublicense pursuant to Article 13, in the Licensed Field of Use for a term commencing as of July 1, 1997 and ending on the
expiration of the last to expire of the Licensed Patent(s). 

  

	3.3	STANFORD shall have the right to practice the Invention(s) and use the Technology for its own bona fide research, including sponsored research and collaborations. STANFORD shall
have the right to publish any information included in Licensed Materials and Licensed Patent(s). 

  

	3.4	Not withstanding Section 3.1 above, the license granted to XENOGEN for those Licensed Materials which are ***, shall be non-exclusive. This Section 3.4 shall have no effect on the
Exclusive License granted herein for (i) the Licensed Patents and (ii) all Licensed Materials and/or Licensed Product(s) other than the ***. 

  
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 4. GOVERNMENT RIGHTS 
  
 This Agreement is subject to all of the terms and conditions of Title 35 United States Code
Sections 200 through 204, including an obligation that Licensed Product(s) sold or produced in the United States be “manufactured substantially in the United States,” and LICENSEE agrees to take all reasonable action necessary on its part
as licensee to enable STANFORD to satisfy its obligation thereunder, relating to Invention(s), provided that STANFORD has provided LICENSEE with written notice of each such obligation STANFORD must meet and a description of each act LICENSEE must
take to comply with such obligation. 
  
 5.
DILIGENCE 
  

	5.1	As an inducement to STANFORD to enter into this Agreement, LICENSEE agrees to use all reasonable efforts and diligence to sublicense the Licensed Patent(s) and/or to proceed with
the development, manufacture, and sale or lease of Licensed
 Product(s). LICENSEE further agrees to diligently develop markets for the Licensed Patent(s) and/or Licensed Product(s). LICENSEE agrees that STANFORD may terminate this Agreement if,
prior to July 1, 2000, LICENSEE has neither sublicensed the Licensed Patent(s) nor made a Licensed Product(s) available for commercial sale. LICENSEE further agrees that STANFORD may terminate this Agreement if, for any period of one (1) full year
after first sublicense or commercial sale, LICENSEE has neither maintained at least one sublicense in force nor sold any Licensed Product(s). 

  

	5.2	Progress Report – On or before September 1 of each year until LICENSEE markets a Licensed Product(s) or grants a sublicense under the Licensed Patent(s), LICENSEE shall
make a written annual report to STANFORD covering the preceding year ending June 30, regarding the progress of LICENSEE toward commercial use of Licensed Product(s) or sublicensing of Licensed 

	 	Patent(s). Such report shall include, as a minimum, information sufficient to enable STANFORD to satisfy reporting requirements of the U.S. Government and for STANFORD to ascertain
progress by LICENSEE toward meeting the diligence requirements of this Article 5. 

  

	5.3	In the event that LICENSEE fails to make available for commercial sale a Licensed Product based on a particular Licensed Material listed in Exhibit A for any period of one (1) full
year after July 1, 2000, STANFORD may convert the Exclusive License granted to LICENSEE solely with respect to that particular Licensed Material (hereinafter, the “Uncommercialized Material”) to a non-exclusive license, provided that
STANFORD gives LICENSEE written notice of such intent and LICENSEE fails to commercialize the Uncommercialized Material within ninety (90) days of such notice. STANFORD agrees that nothing in this Section 5.3 shall have any effect on the Exclusive
License granted to LICENSEE under any Licensed Material(s) or Licensed Product(s) other than the Uncommercialized Material. STANFORD further agrees that nothing in this Section 5.3 shall have any effect on the Exclusive License granted to LICENSEE
under the Licensed Patent(s) in Article 3 herein. 

  
 6. ROYALTIES 
  

	6.1	Beginning July 1, 2000, and each July 1 thereafter, LICENSEE shall pay to STANFORD a yearly royalty of ***. Said yearly royalty payments are nonrefundable, but they are creditable
against earned royalties to the extent provided in Paragraph 6.4. 

  

	6.2	In addition, LICENSEE shall pay STANFORD earned royalties of *** of Net Sales. 

  

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	6.3	In the event that a Licensed Product is sold in combination with or containing one or more products or components, then Net Sales on the combination product shall be calculated
using one of the following methods: 

  

	 	(a)	By multiplying the net selling price of the combination product by the fraction A/A+B, where A is the gross selling price, during the royalty-paying period being considered, of the
Licensed Product sold separately, and B is the gross selling price, during the royalty period in question, of the other products or components sold separately; or 

  

	 	(b)	In the event that no such separate sales are made of the Licensed Product, Net Sales on the combination product for royalty determination shall be as reasonably allocated between
such Licensed Product and the other active products or components, based on their relative importance and proprietary protection, as agreed by the parties. If the parties fail to reach agreement such allocation shall be submitted to binding
arbitration. 

  

	6.4	Creditable payments under this Agreement shall be an offset to LICENSEE against up to *** of each earned royalty payment which LICENSEE would be required to pay pursuant to
Paragraph 6.2 until the entire credit is exhausted. 

  

	6.5	If this Agreement is not terminated in accordance with other provisions hereof, LICENSEE’s obligation to pay royalties hereunder shall continue for so long as LICENSEE, by its
activities would, but for the license granted herein, infringe a valid claim of an unexpired Licensed Patent(s) of STANFORD covering said activity. 

  

	6.6	The royalty on sales in currencies other than U.S. Dollars shall be calculated using the appropriate foreign exchange rate for such currency quoted by the Bank of America (San
Francisco) foreign exchange desk, on the close of business on the last banking day of each calendar quarter. Royalty payments to STANFORD shall be in U.S. Dollars. All non-U.S. taxes related to royalty payments shall be paid by LICENSEE and are not
deductible from the payments due STANFORD. 

  
 7. ROYALTY REPORTS, PAYMENTS, AND ACCOUNTING 
  

	7.1	Quarterly Earned Royalty Payment and Report – Beginning with the first sale of a Licensed Product(s) or the first sublicense, LICENSEE shall make written reports (even
if there are no sales or sublicenses) and earned royalty payments to STANFORD within thirty (30) days after the end of each calendar quarter. This report shall state the number, description, and aggregate Net Sales of Licensed Product(s) during such
completed calendar quarter, and resulting calculation pursuant to Paragraph 6.2 of earned royalty payment due STANFORD for such completed calendar quarter. The report shall also state the number and description of, and fees due under, sublicenses
issued by Xenogen during such completed calendar quarter, and resulting calculation pursuant to Paragraph 13.5 of earned royalty payment due STANFORD for such completed calendar quarter. Concurrent with the making of each such report, LICENSEE shall
include payment due STANFORD of royalties for the calendar quarter covered by such report. 

  

	7.2	Accounting – LICENSEE agrees to keep and maintain records for a period of three (3) years showing the sublicenses granted and the manufacture, sale, use, and other

  
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 disposition of products sold or otherwise disposed of under the license herein granted. Such records will
include general ledger records showing cash receipts and expenses, and records which include production records, customers, serial numbers, and related information in sufficient detail to enable the royalties payable hereunder by LICENSEE to be
determined. LICENSEE further agrees to permit its books and records to be examined by STANFORD from time to time to the extent necessary to verify reports provided for in Paragraph 7.1. Such examination is to be made by STANFORD or its designee, at
the expense of STANFORD, except in the event that the results of the audit reveal an underreporting of royalties due STANFORD of five percent (5%) or more, then the audit costs shall be paid by LICENSEE. 
  
 8. NEGATION OF WARRANTIES 
  

	8.1	Nothing in this Agreement is or shall be construed as: 

  

	 	(a)	A warranty or representation by STANFORD as to the validity or scope of any Licensed Patent(s); 

  

	 	(b)	A warranty or representation that anything made, used, sold, or otherwise disposed of under any license granted in this Agreement is or will be free from infringement of patents,
copyrights, and other rights of third parties; 

  

	 	(c)	An obligation to bring or prosecute actions or suits against third parties for infringement, except to the extent and in the circumstances described in Article 12;

  

	 	(d)	Granting by implication, estoppel, or otherwise any licenses or rights under patents or other rights of STANFORD or other persons other than Licensed Patent(s), regardless of
whether such patents or other rights are dominant or subordinate to any Licensed Patent(s); or 

  

	 	(e)	An obligation to furnish any technology or technological information. 

  

	8.2	Except as expressly set forth in this Agreement, STANFORD MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED. THERE ARE NO EXPRESS OR IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE OF THE LICENSED PRODUCT(S) WILL NOT INFRINGE ANY PATENT, COPYRIGHT, TRADEMARK, OR OTHER RIGHTS OR ANY OTHER EXPRESS OR IMPLIED WARRANTIES. 

 

	8.3	LICENSEE agrees that nothing in this Agreement grants LICENSEE any express or implied license or right under or to U.S. Patent 4,656,134 “Amplification of Eucaryotic
Genes” or any patent application corresponding thereto. 

  
 9. INDEMNITY 
  

	9.1	LICENSEE agrees to indemnify, hold harmless, and defend STANFORD, Stanford Hospital and Clinics and Stanford Health Services and their respective trustees, officers, employees,
students, and agents against any and all claims for death, illness, personal injury, property damage, and improper business practices arising out of the manufacture, use, sale, or other disposition of Invention(s), Licensed Patent(s), Licensed
Product(s), or Licensed Materials by LICENSEE or sublicensee(s), or their customers. 

  

	9.2	STANFORD shall not be liable for any indirect, special, consequential or other damages whatsoever, whether grounded in tort (including negligence), strict liability, contract or

  
  

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 otherwise. STANFORD shall not have any responsibilities or liabilities whatsoever with respect to
Licensed Products(s). 
  

	9.3	LICENSEE shall at all times comply, through insurance or self-insurance, with all statutory workers’ compensation and employers’ liability requirements covering any and
all employees with respect to activities performed under this Agreement. 

  

	9.4	In addition to the foregoing, LICENSEE shall maintain, during the term of this Agreement, Comprehensive General Liability Insurance, including Products Liability Insurance, with
reputable and financially secure insurance carrier(s) to cover the activities of LICENSEE and its sublicensee(s). Commencing with the introduction of Licensed Product(s) into humans for any purpose, including clinical trials, such insurance shall
provide minimum limits of liability of Five Million Dollars ($5,000,000) and shall include STANFORD, Stanford University Hospital, their trustees, directors, officers, employees, students, and agents as additional insureds. Such insurance shall be
written to cover claims incurred, discovered, manifested, or made during or after the expiration of this Agreement. At STANFORD’s request, LICENSEE shall furnish a Certificate of Insurance evidencing primary coverage and requiring thirty (30)
days prior written notice of cancellation or material change to STANFORD. LICENSEE shall advise STANFORD, in writing, that it maintains excess liability coverage (following form) over primary insurance for at least the minimum limits set forth
above. All such insurance of LICENSEE shall be primary coverage; insurance of STANFORD or Stanford Health Services shall be excess and noncontributory. 

  
 10. MARKING 
  

	10.1	Prior to the issuance of any patents on any Licensed Products, LICENSEE agrees to mark all Licensed Products (or their containers or labels) covered by such patents and made, sold,
or otherwise disposed of by LICENSEE under the license granted in this Agreement with the words “Patent Pending,” and following the issuance of one or more patents, with the numbers of such patent(s). 

  

	10.2	STANFORD agrees to provide LICENSEE with notice of all STANFORD patent applications filed (and all STANFORD patents issuing) on any Licensed Products based on Licensed Materials
listed in Exhibit A within 30 days of (i) the filing of such patent applications, and (ii) issuance of such patents. No such notice is required from STANFORD to LICENSEE for patents and patent applications that are included in the Licensed
Patent(s). 

  
 11. STANFORD
NAMES AND MARKS 
  
 Except in connection with the identification of the
source of Invention(s), Licensed Patent(s) and Licensed Products(s), LICENSEE agrees not to identify STANFORD in any promotional advertising or other promotional materials to be disseminated to the public or any portion thereof or to use the name of
any STANFORD faculty member, employee, or student or any trademark, service mark, trade name, or symbol of STANFORD or the Stanford Health Services, or that is associated with either of them, without STANFORD’s prior written consent.
Notwithstanding the above, LICENSEE may use in any manner it deems fit the name(s) of STANFORD faculty members or employees who are inventors on the Inventions, Licensed Patents and/or Licensed Products, and who are employees of or have a consulting
agreement with LICENSEE (“Affiliates”), provided that LICENSEE obtains the voluntary consent of the Affiliates for such 
  
  

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 use. STANFORD agrees that the names of the Affiliates and Affiliates’ connection with STANFORD will appear in
disclosure documents required by securities laws, and in other regulatory and administrative filings in the ordinary course of LICENSEE’S business. Any use of STANFORD’s name shall be limited to statements of fact and shall not imply
endorsement of LICENSEE’s products or services. 
  
 12. PATENT PROTECTION AND INFRINGEMENT 
  

	12.1	LICENSEE shall have the primary responsibility for the prosecution, filing and maintenance of all Licensed Patents, including the conduct of all interference, opposition, nullity
and revocation proceedings, using counsel of its choice; provided, however, that STANFORD shall have reasonable opportunity to advise and consult with LICENSEE on such matters and may instruct LICENSEE to take such action as STANFORD reasonably
believes necessary to protect the Licensed Patent(s). Should LICENSEE elect to abandon any patent or patent application in any country, it shall give timely notice to STANFORD, who may continue prosecution or maintenance, at its sole expense and
LICENSEE shall have not further rights with respect to such patent application or patent in such country. In the event that a conflict arises with respect to patent counsel selected by LICENSEE, STANFORD may, with just cause and after consulting
with LICENSEE, select new patent counsel reasonably acceptable to LICENSEE. 

  

	12.2	Payment of all reasonable fees and costs relating to the filing, prosecution and maintenance of all patent applications and patents within the Licensed Patent(s), including
interference and/or opposition, nullity and revocation proceedings, shall be the responsibility of LICENSEE. STANFORD shall direct the patent counsel to send invoices for such fees and costs directly to LICENSEE with a copy to STANFORD, and LICENSEE
shall pay such patent counsel directly amounts due. 

  

	12.3	STANFORD shall promptly inform LICENSEE of any suspected infringement of any Licensed Patent by a third party and any declaratory judgment filed with respect to any Licensed Patent.
LICENSEE shall have the initial right but not the obligation, at its expense, to initiate and control any proceeding relating to any infringement by a third party of any Licensed Patents, any declaratory action alleging invalidity or noninfringement
of any Licensed Patents, or any interference, opposition, nullity or revocation proceeding relating to any Licensed Patents (“a Protective Action”). In pursuing any such Protective Action, LICENSEE shall provide STANFORD with material
information related to the Protective Action, and shall have the right, but not the obligation, to join STANFORD as a party to the Protective Action, at LICENSEE’s expense. STANFORD shall have the right to participate in the Protective Action
with its own counsel at its own expense. If LICENSEE brings a Protective Action it may enter into a settlement, consent judgment or other voluntary final disposition of such Protective Action, at its sole option, and any damages recovered by a
Protective Action shall be used first to reimburse LICENSEE for the costs (including attorney’s and expert fees) of such Protective Action actually paid by LICENSEE, and the remainder, if any, shall be retained by LICENSEE, except LICENSEE
shall pay STANFORD two percent (2%) of said remainder, provided, if STANFORD joins in any Protective Action at its inception and shares equally in the costs (including attorney’s and expert fees) incurred in its 

  
  

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 conduct, in the event of any recovery each party shall be reimbursed for its expenses incurred in such
Protective Action and STANFORD and LICENSEE shall equally share any remainder. 
  

	12.4	If LICENSEE, or its sublicensee pursuant to Section 13.6, decides not to bring a Protective Action after LICENSEE receives notice from STANFORD pursuant to Section 12.3, LICENSEE
shall inform STANFORD and STANFORD may institute a Protective Action. In such event, STANFORD shall control such Protective Action, including any settlement, consent judgment or other voluntary final disposition thereof at its sole option, and shall
bear the entire cost of such Protective Action and shall be entitled to retain the entire amount of any recovery or settlement. STANFORD may, at its expense, join LICENSEE as a party to such a Protective Action and LICENSEE shall cooperate
reasonably with STANFORD in any such Protective Action, at STANFORD’s expense. 

  

	12.5	Should either party commence a Protective Action under this Section 12 and thereafter elect to abandon the same, it shall give timely notice to the other party who may continue
prosecution of such Protective Action; provided, however, that the sharing of past and future expenses and any recovery in such Protective Action shall be as mutually agreed by the parties. 

  

	12.6	In any Protective Action under this Section 12, the other party hereto shall, at the request and expense of the party initiating such Protective Action, cooperate in all respects
and, to the extent possible, have its employees testify when requested and make available relevant records, papers, information, samples and the like. 

  
 13. SUBLICENSE(S) 
  

	13.1	LICENSEE may grant sublicense(s) during the Exclusive period. LICENSEE may sublicense all or a portion of the rights granted to it pursuant to this Agreement, subject to the
conditions of this Article 13. A “Patent Sublicense” means a sublicense which grants all or a portion of the rights under the Licensed Patent(s) to practice any method, process or procedure claimed therein in all or a part of the Licensed
Territory. It is understood that a Patent Sublicense shall not grant any rights to lease, sublicense, sell, offer for sale, or otherwise commercially dispose of any Licensed Products in any part of the Licensed Territory. A “Products
Sublicense” means a sublicense which grants all or a portion of the rights to lease, sell, offer for sale and otherwise commercially exploit Licensed Products in all or a part of the Licensed Territory. It is understood that a Products
Sublicense may also include rights under the Licensed Patent(s). 

  

	13.2	If LICENSEE is unable or unwilling to serve or develop a potential market or market territory for which there is a willing sublicensee(s), LICENSEE will, at STANFORD’s request,
negotiate in good faith a sublicense(s) hereunder. 

  

	13.3	Any sublicense(s) granted by LICENSEE under this Agreement shall be subject and subordinate to terms and conditions of this Agreement, except: 

  

	 	(a)	Sublicense terms and conditions shall reflect that any sublicensee(s) shall not further sublicense without the written consent of STANFORD, which consent shall not be unreasonably
withheld; and 

  

	 	(b)	The earned royalty rate specified in the sublicense(s) may be at higher rates 

  

 

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 than the rates in this Agreement 
  
 Such sublicense(s) (including, without limitation, any non-exclusive sublicenses) shall remain in effect in the event of any
termination of this Agreement, provided that upon request by STANFORD, such sublicensee agrees in writing to be bound by the applicable terms of this Agreement. All Products Sublicenses shall expressly include the provisions of Articles 7, 8, and 9
for the benefit of STANFORD. All Patent Sublicenses granted to commercial or for-profit entities shall expressly include the provisions of Articles 8 and 9 for the benefit of STANFORD. 
  

	13.4	LICENSEE agrees to provide STANFORD a copy of any sublicense granted pursuant to this Article 13. 

  

	13.5	LICENSEE will pay to STANFORD *** of all non-equity payments received by LICENSEE from its sublicensee(s) for the grant of a sublicense to practice the Licensed Patent(s), excluding
those made under consulting or service agreements. In addition, LICENSEE shall pay to STANFORD *** of all earned royalty income received by LICENSEE from each sublicense from the sale of Licensed Product(s); provided however, that LICENSEE shall pay
to STANFORD no less than *** and no more than *** of such royalty income. 

  

	13.6	With the prior written consent of LICENSEE, and the prior written consent of STANFORD, which shall not be unreasonably withheld, a sublicensee may bring a Protective Action, subject
to the provisions of Section 12.3. 

  
 14. TERMINATION 
  

	14.1	LICENSEE may terminate this Agreement by giving STANFORD notice in writing at least thirty (30) days in advance of the effective date of termination selected by LICENSEE.

  

	14.2	STANFORD may terminate this Agreement if LICENSEE: 

  

	 	(a)	Is in default in payment of royalty or providing of reports; 

  

	 	(b)	Is in breach of any provision hereof; or 

  

	 	(c)	Provides any false report; 

  
 and LICENSEE fails to remedy any such default, breach, or false report within thirty (30) days after written notice thereof by STANFORD. 
  

	14.3	In the event of any termination of this Agreement, LICENSEE shall provide for the transfer to STANFORD of all obligations accrued or accruable after such termination in any active
sublicense(s) issued pursuant to Section 13. Such obligations shall include the payment of any royalties specified in such sublicense(s) that have accrued after termination of this Agreement. 

  

	14.4	Surviving any termination are: 

  

	 	(a)	LICENSEE’s obligation to pay royalties accrued or accruable; 

  

	 	(b)	Any cause of action or claim of LICENSEE or STANFORD, accrued or to accrue, because of any breach or default by the other party; and 

  

	 	(c)	The provisions of Articles 7, 8, 9, 16 and 20, Sections 13.3, 14.3, and 14.4 and any other provisions that by their nature are intended to survive. 

  
 15. ASSIGNMENT 
  
 Neither party may assign this Agreement or any part hereof without the express written
consent of the other, which consent shall not be unreasonably withheld; provided, however, LICENSEE 
  
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 may assign this Agreement or any portion hereof to an affiliate or to a successor of all or substantially all its
business relating to the Licensed Patent(s) without the written consent of STANFORD and shall provide STANFORD notice of any such assignment. 
  
 16. ARBITRATION 
  

	16.1	Any controversy arising under or related to this Agreement, and any disputed claim by either party against the other under this Agreement excluding any dispute relating to patent
validity or infringement arising under this Agreement, shall be settled by arbitration in accordance with the Licensing Agreement Arbitration Rules of the American Arbitration Association. 

  

	16.2	Upon request by either party, arbitration will be by a third party arbitrator mutually agreed upon in writing by LICENSEE and STANFORD within thirty (30) days of such arbitration
request. Judgment upon the award rendered by the arbitrator shall be final and nonappealable and may be entered in any court having jurisdiction thereof. 

  

	16.3	The parties shall be entitled to discovery in like manner as if the arbitration were a civil suit in the California Superior Court. The Arbitrator may limit the scope, time and/or
issues involved in discovery. 

  

	16.4	Any arbitration shall be held at Stanford, California, unless the parties hereto mutually agree in writing to another place. 

  
 17. NOTICES 
  
 All notices under this Agreement shall be deemed to have been fully given when done in
writing and deposited in the United States mail, registered or certified, and addressed as follows: 
  

			
	 To STANFORD:
	  	Office of Technology Licensing
	 	  	Stanford University
	 	  	900 Welch Road, Suite 350
	 	  	Palo Alto, CA 94304-1850
		
	 	  	Attention:    Director
		
	 To LICENSEE:
	  	Xenogen Corporation
	 	  	860 Atlantic Avenue
	 	  	Alameda, CA 94501
		
	 	  	Attention:    President

  
 Either party may change its address
upon written notice to the other party. 
  
 18. WAIVER 
  
 None of the terms of this Agreement can be waived
except by the written consent of the party waiving compliance. 
  
 19. APPLICABLE LAW 
  
 This Agreement
shall be governed by the laws of the State of California applicable to agreements negotiated, executed and performed wholly within California. 
  
  

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 20. CONFIDENTIALITY 
  
 STANFORD shall maintain this Agreement and the reports and any information provided by
LICENSEE to STANFORD pursuant to Articles 5, 7 and 13 in confidence and shall be treated with at least the same degree of care as used to maintain secrecy of STANFORD’s other confidential information. STANFORD may, however, disclose to third
parties total annual royalty payments and general statistical information regarding payments made hereunder in the context of disclosing statistical information pertaining to the performance of the STANFORD Office of Technology Licensing.

  
 21. Entire Agreement 
  
 This Agreement constitutes the entire agreement between LICENSEE and STANFORD and supersedes
all prior communications, understandings and agreements with respect to the subject matter of this Agreement. This Agreement may not be amended except with a written agreement signed by LICENSEE and STANFORD. 
  
  

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 IN WITNESS WHEREOF, the parties hereto have executed this Agreement in duplicate originals by their duly
authorized officers or representatives. 
  

			
	 THE BOARD OF TRUSTEES OF THE LELAND STANFORD JUNIOR UNIVERSITY

		
	 Signature
	 	 /s/    Katharine Ku        

	 	 	

	 Name
	 	 Katharine Ku

	 	 	

	 Title
	 	 Director, Technology Licensing

	 	 	

	 Date
	 	 May 8, 2000

	 	 	

	
	LICENSEE
		
	 Signature
	 	 /s/    David W. Carter        

	 	 	

	 Name
	 	 David W. Carter

	 	 	

	 Title
	 	 Chairman and Co-CEO

	 	 	

	 Date
	 	 
	 	 	

  
  

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 Exhibit A 
  
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 *** Confidential treatment requested 
  

 -13-License Agreement with Ohio University

 EXHIBIT 10.14 
  
 [CONFIDENTIAL TREATMENT GRANTED. CERTAIN PORTIONS OF THIS 
 AGREEMENT HAVE BEEN REDACTED AND SEPARATELY FILED WITH THE COMMISSION] 
  
 LICENSE AGREEMENT 
  
 This Agreement made this 13th day of June, 1985 between the Ohio University, a body politic incorporated under the laws of the State of Ohio having its
principal office at Athens, Ohio 45701 (hereinafter “Licensor”), and Embryogen, Inc., a corporation under the laws of the State of Ohio having its principal office at One President Street, Athens, Ohio 45701 (hereinafter
“licensee”). 
  
 WHEREAS, Licensor and Licensee have
entered into a License Agreement dated November 1, 1984, which granted a nonexclusive license to Licensee for the purpose of developing and commercializing the technology embodied in a patent application, U.S. Serial No. 273.239, filed June 12,
1981, entitled Genetic Transformation of Zygotes, and more specifically described as embryonic nuclear insertion gene transfer technology (hereinafter referred to as the “Invention”); 
  
 WHEREAS, Licensor and Licensee intend to terminate the November 1, 1984
License Agreement and enter into this Agreement in lieu thereof; 
  
 WHEREAS, Licensor desires to grant an exclusive license to Licensee, subject to a certain limited license heretofore granted to Genetic Engineering (hereinafter referred to as the “Genetic Engineering License”), and subject to
certain terms and conditions set forth below, for the purpose of developing the technology claimed in the patent application for commercial purposes; and 
  
 WHEREAS, Licensee desires to obtain an exclusive license from Licensor, excluding the rights granted under the Genetic 
  

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 Engineering License and subject to the terms and conditions set forth below. 
  
 NOW, THEREFORE, in consideration of the representations, warranties and
covenants herein contained and the sum of $10.00 paid by Licensee to Licensor, the receipt of which is hereby acknowledged, the parties hereto agree as follows: 
  

A. LICENSOR’S AND LICENSEE’S RIGHTS. 
  
 1. License. The Licensor grants to the Licensee the exclusive, nontransferable right and license to manufacture, use, market, sell, and otherwise
commercialize the Invention and its improvements throughout the world. Such license includes the right to grant sublicenses upon terms consistent with this Agreement. The exclusive right and license herein granted shall apply to all inventions,
improvements, patent applications, letters patent, trade secrets, know – how or proprietary information which the Licensor now owns or controls, or hereafter shall own or control, relating to the Invention, including the patent application,
U.S. Serial No. 273.239, filed June 12, 1981, entitled Genetic Transformation of Zygotes. 
  
 2. Exclusion. The exclusivity of this license is subject to the rights granted in the Genetic Engineering License, a copy of which is available for inspection at the offices of Licensor. This exclusion shall
apply to only such rights as are granted therein and Licensee shall have all other rights for its exclusive use and employment. 
  
 3. Improvements. Should Licensor make any improvements in the Invention or the manner of using the same, it is hereby agreed that Licensee shall be
entitled to use the same with all 
  

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 rights which are hereby granted with respect to the Invention. The term, “improvements”, shall mean all
modifications, enhancements and changes in or with respect to the Invention, including the manufacture, use and the application of the Invention. 
  
 4. Royalties. 
  
 (a) Licensee shall pay to Licensor the following royalty payments: 
  
 (i) A royalty equivalent to * * * of the net sales made, if any, by Licensee on any product produced from
Licensee’s use of the Invention referred to above for the term of this Agreement; and 
  
 (ii) A royalty equivalent to * * * of the royalties, rents, fixed payments or other payments actually received, if any, by Licensee, under
licenses, sublicenses, and distribution, marketing, or exploitation agreements with others regarding the Invention and any products produced therefrom. 
  
 (b) “Net Sales” shall refer to the invoice price and dollars charged by Licensee for all products sold using the information
contained in the Invention which is the subject matter of this Agreement, excluding the following: 
  
 (i) Any common carrier charge for transportation of said product, to the extent included in such invoice price as a separately stated
charge; 
  
 (ii) Credit given or allowances made
by Licensee on account of returns, replacement, defects or renegotiation of the invoice price of the product sold hereunder; 
  
 (iii) Any sales, excise, use or ad valorem taxes 
  

* * * CONFIDENTIAL TREATMENT REQUESTED 
  

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 and any direct governmental charges assessed on the manufacture, sales or delivery of said product and
included in such invoice price as a separately stated charge; 
  
 (iv) Any price paid by any subsidiary or affiliate controlled by Licensee, if said subsidiary or affiliate purchased the product; and 
  
 (v) Any insurance, packing charges, rate discounts, normal and customary trade, cash, and quantity discounts
actually allowed, or commissions to local or foreign agents to the extent that they are separately stated on the invoice. 
  
 (c) “Payments actually received” shall mean cash received or funds deposited to the account of Licensee in which Licensee has an
unrestricted right of access and right to use the funds so paid. 
  
 (d) Royalties shall be due and payable annually on or before April 30 for the previous fiscal year (December 31) and Licensee agrees to render with each royalty payment a written statement setting forth the total net
sales and payments actually received that are subject to the aforesaid royalty. 
  
 (e) Licensee shall keep, and cause to be kept, detailed accurate records and books of accounts showing the information necessary for
accurate determination of royalties to be paid under this Agreement. Licensee agrees to allow Licensor and its representatives to make reasonable inspections and examinations of Licensee’s operation, books and records as they relate to this
particular license, but no more than once per year. 
  

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 5. Disclosure. Promptly upon request by Licensee, Licensor shall fully disclose to Licensee all
available information concerning the practice of the Invention. 
  
 B. PATENT APPLICATION AND USE OF THE LICENSE 
  
 1.
Patent Prosecution. Licensor agrees to prosecute domestic and foreign patent applications at its expense concerning the Invention and any improvements hereto licensed to Licensee by Licensor pursuant to this Agreement. 
  
 2. Right to Sublicense. Licensee shall have the right to sublicense
any of its rights granted hereunder to any person, firm or corporation wheresoever situated. 
  
 3. Marketing Disclosure. From time to time, Licensee agrees to consult with Licensor concerning the plans relating to the proposed marketing of the subject matter of the Invention and to inform Licensor as to
the progress being made in the development for the ultimate commercial exploitation of the Invention. 
  
 4. Assignment. The Licensee shall not have the right to assign this Agreement without the prior written consent of the Licensor, unless such
assignment shall be to an entity in which Licensee owns a controlling interest. 
  
 C. LICENSOR’S RESERVED RIGHTS. 
  
 Licensor reserves the right to continue research and development of the Invention, including assigning research rights and engaging in other funded research regarding the Invention and the subject matter of the Invention. Licensor shall not
commercialize, sell, assign or otherwise transfer any right or information regarding the Invention for the purpose of commercial 
  

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 practice of the Invention without the prior written consent of Licensee, which consent may be withheld for any reason
whatsoever. Licensor shall prevent the disclosure of trade secrets and other proprietary information regarding the Invention and it shall require any person, firm or corporation to whom it shall make an authorized disclosure to enter into a
confidentiality agreement in form satisfactory to Licensee. 
  
 D.
TERM 
  
 1. Events of Termination. This Agreement shall
continue until the expiration of the last patent on the Invention and its improvements, subject to the following: 
  
 (a) The Invention shall enter the public domain due to any reason whatsoever; 
  
 (b) In the event of default or the breach of any term or condition of this Agreement by the Licensee, the Licensor may
terminate this Agreement on 90 days written notice provided that the Licensee shall have a period of 90 days from the date of receipt of such notice within which to cure any default or breach. In the event such default or breach is cured, the
termination shall be withdrawn by the Licensor; 
  
 (c) In the
event of default or breach by Licensor, the same provisions shall apply as for the Licensee in the foregoing subparagraph. 
  
 2. Termination Procedure. Upon termination of this Agreement for any cause, the Licensee shall duly account to the Licensor and shall transfer to
Licensor all rights which it may possess and sublicenses, letters patents, inventions, trade names, and trademarks relating to the Invention and improvements thereto. 
  

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 3. Effects of Termination. In the event of termination of this Agreement, the following shall
occur: 
  
 (a) Unless otherwise prohibited by
law, upon the termination of this Agreement, Licensee shall have the right to complete any and all contracts for the sales of products containing the Invention or improvements that it may have upon its book or that it has become obligated for, and
Licensee shall pay the royalties as herein provided; provided that all contracts and sales are completed within six (6) months after the termination of this Agreement; 
  
 (b) Licensee shall provide in any sublicense of the rights granted in this Agreement that, upon the request
of Licensor, Licensee shall have the right and power to assign, and shall forthwith assign to Licensor all rights, title and interest in, to and under the sublicense agreement between Licensee and its sublicensees and that after any such assignment
Licensor shall be entitled to the royalties and other compensation payable by the sublicensees pursuant to the terms of the sublicense and Licensor shall be subrogated to the rights and liabilities of Licensee. In the event such sublicense grants
rights to other inventions and improvements owned or controlled by other persons, firms or corporations in addition to the rights to the Inventions and improvements granted hereunder, Licensor shall only be assigned a share of the compensation
payable under such sublicense. Such share shall be in proportion to the ratio of the royalty amount Licensor would have received under this Agreement to the total amount payable by Licensee to all 
  

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 licensors, including Licensor, as a result of Licensee’s sublicense; 
  
 (c) Subject to the foregoing requirements regarding the
completion of contracts, upon the termination of this Agreement for whatever reason, Licensee shall return any and all information in its possession regarding the Invention or improvements; 
  
 (d) Due to the unique nature of the Invention and
improvements and the irreparable harm to the Licensor should Licensee continue to propagation of the Invention or improvements embodied in the Licensee’s products, Licensor is authorized and entitled to obtain from any court of competent
jurisdiction restraining orders and preliminary and permanent injunctive relief, as well as an equitable accounting of all profits and benefits arising out of any such occurrence, prohibiting Licensee from thereafter using, raising, selling,
propagating or otherwise disseminating the Invention or improvements. The restraining orders and injunctive relief shall allow Licensee to complete certain of its sales contracts as provided heretofore and to require Licensee and its sublicensees to
immediately sell, if possible without further propagation or use, all products containing the Invention or improvements or otherwise assure Licensor that there will be no further use or propagation of the Invention or improvements; 
  
 (e) At the option of Licensee, and in lieu of the foregoing
equitable remedy prohibiting the use and propagation of the Invention or improvements, Licensee may elect to pay liquidated damages in the amount of two and one half (2.5) times 
  

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 the present value of the stream of royalty income Paid to Licensor over a 5 year period and amortized at
a ten percent (10%) discount rate. The yearly royalty payment for the stream of income shall be the highest yearly royalty for any one calendar year during the preceding three (3) years. In such event, Licensee shall continue to receive the rights
and benefits granted under this Agreement. 
  
 E. INFRINGEMENT.

  
 1. Licensee to Defend. The Licensee shall defend
infringement suits that may be brought against Licensee or Licensor on account of the manufacture, use, or sale of-the-Invention and improvements thereto and when information is brought to its attention indicating that others, without license, are
unlawfully infringing on the rights granted in this Agreement, Licensee shall prosecute diligently the infringer. 
  
 2. Cooperation. Licensor shall cooperate and assist Licensee at the request of Licensee in the defense of any infringement or the prosecution of
any unlawful infringer. 
  
 3. Expenses. Licensor shall, to
the extent of the royalties to be received hereunder, indemnify Licensee for all expenses incurred for the defense of any infringement suits that may be brought against Licensee or Licensor on account of the manufacture, use, or sale of the
Invention. Licensee shall pay all expenses incurred with respect to prosecuting unlawful infringers of the Invention. 
  
 F. NOTICE. 
  
 Any notice or payment required under this Agreement shall be addressed as follows: 
  

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 If to Licensor: 
  

The Edison Animal Biotechnology Center 
 The Ohio University 
 Attention: Director of the Center 
 Athens, Ohio 45701 
  
 If to Licensee: 
  
 Embryogen, Inc. 
 Attention: President 
 One President Street 
 Athens, Ohio 45701 
  
 G. MISCELLANEOUS 
  
 1. Benefit. This Agreement shall be binding upon the parties, their successors and assigns, where permitted. 
  
 2. Waiver. Waiver of any breach of this Agreement by either party
hereto shall in no event constitute a waiver as to any future breach, whether or not similar in nature. 
  
 3. Covenant of Further Assurances. Each of the parties hereto, forthwith upon request from the other, shall execute and deliver such documents and
take such actions as may be reasonably requested in order to carry out the intent and purposes of this Agreement. 
  
 4. Construction and Governing Law. This Agreement shall be construed and interpreted in accordance with the laws of the State of Ohio. 

 
 5. Arbitration. Any dispute under this Agreement shall be settled
in Athens, Ohio, by arbitration pursuant to the rules then obtaining of the American Arbitration Association. 
  
 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized officer on the date and year first above
written. 
  

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	THE OHIO UNIVERSITY
		
	By:	 	/s/    James L. Bruning        
	 	 	

	 	 	 James L. Bruning, Provost

  

			
	EMBRYOGEN, INC
		
	By:	 	/s/    Wilfred R. Konneker        
	 	 	

	 	 	 Wilfred R. Konneker, President

  

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 AMENDMENT TO LICENSE AGREEMENT 
 DATED THE 13TH DAY OF JUNE, 1985 
  
 Licensee shall prosecute all continuation and improvements in the patent No 4,873,191, Genetic Transformation of Zygotes, covered by this License Agreement at its expense; and to report of any major developments with
such prosecution to the Licensor and provide a yearly written report of developments along with the fourth-quarter royalty report. 
  
 Dated and effective this 1st day of July 1991. 
  

					
	 LICENSEE
	 	 	 	 LICENSOR

			
	/s/    Steven Holtzman        	 	 	 	/s/    James L. Bruning        
	
	 	 	 	

	 Steven Holtzman
 Vice President, D.N.X.,
Inc.
	 	 	 	 James L. Bruning
 Provost of Ohio
University

  
  

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