Document:

Exhibit 10.16

 

NON-EXCLUSIVE LICENSE AGREEMENT

 

This
Non-Exclusive License Agreement (“Agreement”) is made and entered into this 3rd
day of February, 2004 (the “Effective Date”), by and between Advanced
Cell Technology, Inc., a Delaware corporation with offices located at One
Innovation Drive, Worcester, Massachusetts 01605 (“ACT”), and First Degree
Genetics LLC, a Delaware limited liability company with offices located at 18 Plimpton
Road, Westerly, R.I. 02891 (“LICENSEE”) (ACT and LICENSEE sometimes hereinafter
referred to as the “parties”).

 

WITNESSETH

 

WHEREAS,
Robert Saglio, the principal of LICENSEE (“Saglio”), has been employed by ACT’s
parent company A.C.T. Group, Inc. (“Group”) as an executive; and

 

WHEREAS,
Saglio’s employment with Group terminated on August 8, 2002; and

 

WHEREAS,
in connection with the termination of Saglio’s employment by Group Saglio and
Group entered into a letter agreement dated July 22, 2002 (the “Letter
Agreement”), a copy of which is attached hereto as Exhibit A; and

 

WHEREAS,
in connection with the termination of Saglio’s employment by Group Saglio and
Group entered into a General Release and Indemnification Agreement dated February 3,
2004 (the “Release”), a copy of which is attached hereto as Exhibit B;
and

 

WHEREAS,
ACT owns or has licensed with a sublicensable interest the PATENT RIGHTS (as
defined below) and KNOW-HOW (as defined below); and

 

WHEREAS,
Saglio owns directly more than fifty percent (50%) of LICENSEE; and

 

WHEREAS,
Saglio desires to obtain for LICENSEE a nonexclusive license from ACT in and
under the PATENT RIGHTS and KNOW-HOW; and

 

WHEREAS,
the Letter Agreement contemplates that ACT will grant such a license to
LICENSEE; and

 

WHEREAS,
ACT is willing to grant such a license to LICENSEE upon the terms and conditions
set forth below; and

 

NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
herein, the parties hereto agree as follows:

 

ARTICLE 1 - DEFINITIONS

 

For
the purposes of this Agreement, the following words and phrases shall have the
following meanings:

 

1.1                                 “DEVELOPMENTS”
means inventions, patents and patent rights not included in the

 

 

PATENT RIGHTS that are
conceived, discovered, invented, developed, created, made or reduced to
practice by ACT during the term of this Agreement.  For the avoidance of doubt, the term
DEVELOPMENTS does not include inventions, patents and patent rights obtained by
ACT from any third party.

 

1.2                                 “FIELD
OF COMPANION ANIMALS” means the cloning, development, making, using, selling,
offering to sell or importing of animals of the canine or feline species for
DOMESTIC PURPOSES.  For purposes of
illustration but not by way of limitation, the FIELD OF COMPANION ANIMALS does
not include laboratory animals or animals intended for research purposes.

 

1.3                                 “KNOW-HOW”
means all compositions of matter, techniques and data and other know-how and
technical information including inventions (whether or not patentable),
improvements and developments, practices, methods, concepts, trade secrets,
documents, computer data, computer code, apparatus, clinical and regulatory
strategies, test data, analytical and quality control data, formulation,
manufacturing, patent data or descriptions, development information, drawings,
specifications, designs, plans, proposals and technical data and manuals and
all other proprietary information that is owned or controlled by ACT as of the
Effective Date that relates to cloning technology or to any of the subject
matter described in or claimed by the PATENT RIGHTS and is relevant to the
FIELD OF COMPANION ANIMALS.

 

1.4                                 “LICENSED
PROCESS” means any process or method, the researching, developing, using,
practicing, selling, offering for sale, importing or exporting of which by
LICENSEE would, but for the licenses granted to LICENSEE in Article 2
of this Agreement, infringe a VALID CLAIM of the PATENT RIGHTS in the country
in which such process or method is researched, developed, practiced, sold,
offered for sale, imported or exported.

 

1.5                                 “LICENSED
PRODUCT” means (a) any product, the making, using, selling, offering for
sale, importing or exporting of which by LICENSEE, would, but for the licenses
granted to LICENSEE in Article 2 of this Agreement, infringe a
VALID CLAIM of the PATENT RIGHTS in the country in which any such product is so
made, used, sold, offered for sale, imported or exported by LICENSEE or (b) any
product that is made by LICENSEE using a process or method that would, but for
the licenses granted to LICENSEE in Article 2 of this Agreement,
infringe a VALID CLAIM of the PATENT RIGHTS in the country in which any such
process or method is used.

 

1.6                                 “LICENSED
SERVICES” means any service, the developing, using, performing, selling,
offering for sale, importing or exporting of which by LICENSEE would, but for
the licenses granted to LICENSEE in Article 2 of this Agreement,
infringe a VALID CLAIM of the PATENT RIGHTS in the country in which any such
service is so developed, used, performed, sold, offered for sale, imported or
exported by LICENSEE.

 

1.7                                 “LICENSEE”
means First Degree Genetics LLC, a Delaware limited liability company with
offices located at 18 Plimpton Road, Westerly, R.I. 02891.

 

1.8                                 “NET
SALES” shall mean the amount billed or invoiced by LICENSEE for the sale or
provision of LICENSED PRODUCTS or LICENSED PROCESSES or LICENSED SERVICES less:

 

(a)                                  discounts
allowed;

 

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(b)                                 sales,
tariff duties, use and other taxes directly imposed with reference to
particular sales;

 

(c)                                  special
packaging, transportation and insurance prepaid or allowed; and

 

(d)                                 amounts
allowed or credited on returns.

 

1.9                                 “PATENT
RIGHTS” means (a) the patent applications and patents identified on Exhibit C
attached hereto and any patents that issue on said applications and (b) any
divisions, continuations, continuations-in-part, extensions, reissues or
reexaminations of any of the patents identified in the foregoing clause (a).  The parties agree that Exhibit C
may be revised from time to time after the Effective Date to reflect changes
thereto.

 

1.10                           “TERM”
has the meaning set forth in Section 8.1.

 

1.11                           “TERRITORY”
means the entire world.

 

1.12                           “UMASS
LICENSE” means the Exclusive License Agreement between ACT and the University
of Massachusetts, dated April 16, 1996, as amended by the Amendment to Exclusive
License Agreement dated September 1, 1999, the Second Amendment to
Exclusive License Agreement dated May 31, 2000, and the Third Amendment to
Exclusive License Agreement dated September 19, 2002.

 

1.13                           “VALID
CLAIM” means a claim of any issued and unexpired patent within the PATENT
RIGHTS which has not lapsed, become abandoned or been held revoked, invalid, or
unenforceable by a decision of a court or administrative or government
authority or agency of competent jurisdiction from which no appeal can be or
has been taken within the time allowed for such appeal, and which has not been
admitted to be invalid or unenforceable through reissue, disclaimer or
otherwise.

 

Additional
terms may be defined throughout this Agreement.

 

ARTICLE 2 - GRANT

 

2.1                                 ACT
hereby grants to LICENSEE, and LICENSEE hereby accepts, subject to the terms
and conditions hereof, a royalty bearing, nonexclusive license in the TERRITORY
in the FIELD OF COMPANION ANIMALS and under the PATENT RIGHTS and KNOW-HOW to (a) research,
develop, make, have made, use, sell, have sold, offer for sale, have offered
for sale, import, have imported, export and have exported LICENSED PRODUCTS, (b) research,
develop, use, practice, sell, have sold, offer for sale, have offered for sale,
import, have imported, export and have exported LICENSED PROCESSES and (c) develop,
use, perform, sell, have sold, offer for sale, have offered for sale, import,
have imported, export and have exported LICENSED SERVICES.  LICENSEE shall have the right, in connection
with the licenses to “have made,” “have sold,” “have offered for sale,” “have
imported” and “have exported” to sublicense the rights granted in this Section 2.1
to third parties in connection with contracting with such third parties to (x)
provide LICENSED PRODUCT marketing and distribution services to LICENSEE on
behalf of LICENSEE, (y) provide Licensed Services

 

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marketing services to
LICENSEE on behalf of LICENSEE or (z) manufacture for LICENSEE LICENSED PRODUCTS
for sale by LICENSEE or a third party pursuant to the foregoing clause (x).

 

2.2                                 Except
as expressly provided by Section 2.1 above, LICENSEE shall not have the
right to grant sublicenses without the express prior written approval of ACT,
which approval shall be granted or denied in ACT’s sole discretion.

 

2.3                                 Within
thirty (30) business days of the Effective Date, ACT shall provide and transfer
to LICENSEE all information and data relating to the PATENT RIGHTS and KNOW-HOW
as may be reasonably necessary to allow LICENSEE to exploit the licenses
granted hereunder.

 

2.4                                 LICENSEE
acknowledges that a portion of the PATENT RIGHTS licensed to LICENSEE hereunder
is owned by the University and is licensed to ACT under the UMASS LICENSE.  In the event the UMASS LICENSE expires or is
terminated for any reason pursuant to the provisions of the UMASS LICENSE or
otherwise, the terms of the letter agreement attached hereto as Exhibit D
between ACT, LICENSEE and the University shall apply to this Agreement.

 

ARTICLE 3 - LICENSEE OBLIGATIONS

RELATING TO COMMERCIALIZATION

 

3.1                                 LICENSEE
shall use its commercially reasonable and diligent efforts to bring one or more
LICENSED PRODUCTS, LICENSED PROCESSES or LICENSED SERVICES to market through an
active and diligent program for exploitation of the PATENT RIGHTS and to
continue active, diligent marketing efforts for one or more LICENSED PRODUCTS,
LICENSED PROCESSES or LICENSED SERVICES throughout the Term of this Agreement.

 

3.2                                 LICENSEE
shall maintain complete and accurate records of LICENSED PRODUCTS, LICENSED
PROCESSES and LICENSED SERVICES that are made, used, sold or performed by
LICENSEE under this Agreement.  Not later
than May 1st of each year following the Effective Date,
LICENSEE shall furnish ACT with a summary report on the progress of its efforts
during the prior year to develop and commercialize LICENSED PRODUCTS, LICENSED
PROCESSES or LICENSED SERVICES, including without limitation research and
development efforts, efforts to obtain regulatory approval, marketing efforts
(including LICENSED PRODUCTS, LICENSED PROCESSES and LICENSED SERVICES made,
used, sold or performed) and sales figures, provided that such reports shall be
deemed Confidential Information (as defined in Section 10.1 herein)
subject to the provisions of Article 10 of this Agreement.

 

3.3                                 In
the event that ACT determines that LICENSEE has not fulfilled its obligations
under this Article 3, ACT shall furnish LICENSEE with written notice of
such determination.  Within sixty (60)
days after receipt of such notice, LICENSEE shall either (i) fulfill the
relevant obligation or (ii) negotiate with ACT a mutually acceptable schedule of
revised obligations; failing which ACT shall have the right, immediately upon
written notice to ACT, to terminate this Agreement.

 

ARTICLE 4 - CONSIDERATION

 

4.1                                 Initial
Payment.  In partial consideration of
the license granted to LICENSEE from ACT in Article 2 of this Agreement,
LICENSEE agrees to pay a “License Fee” to ACT, by delivery by

 

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LICENSEE within thirty
(30) days after the Effective Date, of a convertible promissory note in the
form attached hereto as Exhibit E.

 

4.2                                 Royalties.

 

(a)                                  In
partial consideration of the license in the FIELD OF COMPANION ANIMALS granted
by ACT to LICENSEE in Article 2 of this Agreement, LICENSEE agrees to pay
to ACT an earned royalty equal to five percent (5%) of the NET SALES in the
FIELD OF COMPANION ANIMALS made, used, sold, imported, exported or performed by
LICENSEE in the TERRITORY.

 

(b)                                 No
multiple royalties shall be payable because any LICENSED PRODUCT, LICENSED
PROCESS or LICENSED SERVICE in the FIELD OF COMPANION ANIMALS, its manufacture,
use, lease, sale or performance are or shall be covered by more than one patent
or patent application within the PATENT RIGHTS.

 

(c)                                  The
obligation of LICENSEE to pay royalties or Sublicense Income (as defined in Section 4.3
herein) hereunder shall terminate for each country in the TERRITORY
concurrently with the expiration or termination of the last applicable VALID
CLAIM within the PATENT RIGHTS in such country in which the LICENSED PRODUCT,
LICENSED PROCESS or LICENSED SERVICE is, (as applicable), used, practiced,
performed, sold, offered for sale, imported, exported or manufactured.

 

4.3                                 Sublicense
Income.  LICENSEE shall pay to ACT a
total of twenty-seven and one-half percent (27.5%) of all Sublicense Income.  “Sublicense Income” means consideration that
LICENSEE receives for the sublicense of rights that are granted LICENSEE under Article 2,
approved in writing by ACT, including without limitation license fees,
milestone payments, equity payments, up front fees, success fees, and license
maintenance fees.

 

4.4                                 Payments
in U.S. Currency.  All payments due
under this Agreement shall be paid in cash to ACT and all payments shall be
made in United States currency.  Conversion
of foreign currency to U.S. dollars shall be made at the conversion rate
reported in The Wall Street Journal on the last working day of the
calendar quarter to which the payment relates.

 

4.5                                 Taxes.
 All payments due hereunder shall be paid
in full without deduction of taxes or other fees which may be imposed by any
government and which shall be paid by LICENSEE; provided, however, that any
withholding tax required to be withheld by LICENSEE on royalty payments under
the laws of any country in the TERRITORY on behalf of ACT will be timely paid
by LICENSEE to the appropriate governmental authority, and LICENSEE will
furnish ACT with proof of payment of such tax.  Any such tax actually withheld may be deducted
from royalty payments due to ACT under this Agreement.  If at any time legal restrictions prevent the
prompt remittance of part or all of any payments owed by LICENSEE to ACT
hereunder with respect to any country in the TERRITORY, payment shall be made
through any lawful means or methods that may be available, and as LICENSEE
shall reasonably determine is appropriate.

 

4.6                                 Overdue
Payments.  Any payments to be made by
LICENSEE hereunder that are not paid on or before the date such payments are
due under this Agreement shall bear interest, to the extent permitted by law,
at two percentage points above the Prime Rate of interest as reported in The
Wall

 

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Street Journal
on the date payment is due, with interest calculated based on the number of
days that payment is delinquent.

 

ARTICLE 5 - REPORTS AND RECORDS

 

5.1                                 LICENSEE
shall keep full, true and accurate books of account containing all particulars
that may be necessary for the purpose of showing the amounts payable to ACT
hereunder and to enable the reports provided under Section 5.2 to
be verified.  Said books of account shall
be kept at LICENSEE’s principal place of business.  Said books and the supporting data shall be
open upon reasonable advance notice (but not less than five (5) business
days notice and no more frequently than once per calendar year) for three (3) years
following the end of the calendar year to which they pertain, to the inspection
of ACT or its agents for the purpose of verifying LICENSEE’s royalty and
Sublicense Income statement or compliance in other respects with this Agreement.
 If any such audit determines an error in
any royalty or Sublicense Income payment, LICENSEE shall pay to ACT, within
thirty (30) days of the discovery of the error, (a) all deficiencies in
royalty or Sublicense Income payments, (b) interest on such deficiencies
from the date such royalty or Sublicense Income payment was due until the date
paid at the rate set forth in Section 4.6 above, and (c) if such
error is in excess of five percent (5%) of any royalty or Sublicense Income
payment, the cost of the audit.  In all
other cases, the costs of the audit shall be paid for by ACT.  All information disclosed pursuant to an audit
shall be treated as Confidential Information (as defined in Section 10.1
herein) and shall not be disclosed to any third party or used for any purpose
other than to determine the correctness of LICENSEE’s royalty and Sublicense
Income statement or compliance in other respects with this Agreement.

 

5.2                                 After
the first commercial sale of a LICENSED PRODUCT or LICENSED PROCESS, LICENSEE,
within forty-five (45) days after March 31, June 30, September 30
and December 31 of each year, shall deliver to ACT a true and accurate
report, giving such particulars of the business conducted by LICENSEE and its
permitted sublicensees during the preceding three-month period under this
Agreement as shall be pertinent to a royalty and Sublicense Income accounting
hereunder.  Without limiting the
generality of the foregoing, these reports shall include at least the
following:

 

(a)                                  the
number of LICENSED PRODUCTS manufactured and sold by LICENSEE and all
sublicensees;

 

(b)                                 total
billings and the amounts actually received for LICENSED PRODUCTS sold by
LICENSEE and all sublicensees;

 

(c)                                  an
accounting for all LICENSED PROCESSES or LICENSED SERVICES used in the
provision of services to others or sold by LICENSEE;

 

(d)                                 the
deductions applicable as provided in Section 1.11; and

 

(e)                                  the
names and addresses of all parties making LICENSED PRODUCTS on behalf of
LICENSEE.

 

The reports shall provide
the above-identified information by animal.

 

5.3                                 With
each such report submitted, LICENSEE shall pay to ACT the royalties and

 

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Sublicense Income due and
payable for such three-month period. If no royalties or Sublicense Income shall
be due, LICENSEE shall so report.

 

ARTICLE 6 - PATENT PROSECUTION

 

6.1                                 ACT
shall be solely responsible for the continued prosecution of pending patent
applications included in the PATENT RIGHTS and the issuance of such
applications after allowance.  Additionally,
ACT shall pay all government fees in any given country required to maintain the
PATENT RIGHTS; and shall submit evidence to LICENSEE upon request that such
fees have been timely paid.  The
prosecution, filing and maintenance of all patents and applications shall be
the primary responsibility of ACT. LICENSEE agrees to cooperate fully with ACT,
as requested by ACT and at ACT’s expense, in the preparation, filing,
prosecution, and maintenance of the patent applications and patents included in
the PATENT RIGHTS.

 

ARTICLE 7 - PROSECUTION OF INFRINGERS

AND DEFENSE OF PATENT RIGHTS

 

The
parties agree to notify each other in writing of any actual or threatened
infringement by a third party of Patent Rights or of any claim of invalidity,
unenforceability, or non-infringement of the Patent Rights.  ACT shall have the sole responsibility to
prosecute or defend such claims, as applicable.  LICENSEE shall if requested provide reasonable
assistance to ACT, at ACT’s expense, in connection with the prosecution or
defense of such claims.

 

ARTICLE 8 - INDEMNIFICATION

 

8.1                                 LICENSEE
shall at all times during the term of this Agreement and thereafter, indemnify,
defend and hold harmless ACT and the University and their trustees, directors,
officers, employees and affiliates (collectively, the “Indemnified Parties”)
against all liabilities of any kind whatsoever, including legal expenses and
reasonable attorneys’ fees (excluding, pursuant to Article 13 hereof, any
special, indirect, reliance, incidental, exemplary, cover or consequent damages
suffered or incurred by any of the Indemnified Parties directly (as opposed to
any special, indirect, reliance, incidental, exemplary, cover or consequential
damages suffered or incurred by third parties who are, in turn, seeking the
same from the Indemnified Parties, which shall be covered by the indemnity set
forth herein)), incurred or imposed upon any of the Indemnified Parties in
connection with or as a consequence of any claims (including third party
claims), suits, actions, demands or judgments arising out of the death of or
injury to any person or persons or out of any damage to property resulting from
the development, production, manufacture, sale, use, performance, rendering,
consumption or advertisement of the LICENSED PRODUCT(s) and/or LICENSED
PROCESS(es) or arising from any obligation, act or omission performed or failed
to be performed hereunder, or from a breach of any representation or warranty
of LICENSEE hereunder, excepting only claims that the PATENT RIGHTS or the
exercise thereof infringe third party intellectual property or claims that
result from any breach by ACT of this Agreement.

 

8.2                                 If
the exercise of LICENSEE’s rights under this Agreement in any country in the
TERRITORY is the subject of a bona fide claim by a third party, filed in a
court of competent jurisdiction after the date hereof, that the exercise of
such rights infringes or conflicts with any intellectual property rights of
such third party (a “Third Party Infringement Claim”), then LICENSEE

 

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shall not have any of the
rights granted herein in such country and shall have no obligation to pay ACT
any further payments under Article 4 of this Agreement with respect to any
country of the TERRITORY until such claim is resolved by proper adjudication or
settlement permitting LICENSEE to exercise LICENSEE’s rights under this
Agreement in the applicable country of the TERRITORY.  Notwithstanding anything herein to the
contrary, ACT covenants that it will not (a) assert or bring any suit,
action, claim or other proceeding against LICENSEE based on, in whole or in
part, LICENSEE’s exercise of LICENSEE’s rights, in accordance with the terms
and conditions of this Agreement, with respect to the PATENT RIGHTS and/or KNOW_HOW
and/or (b) join in any third party suit, action, claim or other proceeding
against LICENSEE based on, in whole or in part, any intellectual property
rights (including without limitation, patent rights and/or know how) owned by
the applicable third party, so long as LICENSEE is not in violation of this
Agreement.

 

8.3                                 Any
indemnification obligations set forth in this Agreement shall be subject to the
following conditions: (i) the indemnified party shall notify the
indemnifying party in writing promptly upon learning of any claim or suit for
which indemnification is sought; (ii) the indemnifying party shall have
control of the defense or settlement, provided that the indemnified
party shall have the right (but not the obligation) to participate in such
defense or settlement with counsel at its selection and at its sole expense;
and (iii) the indemnified party shall reasonably cooperate with the
defense, at the indemnifying party’s expense.

 

8.4                                 LICENSEE
agrees to maintain insurance or self-insurance that is reasonably adequate to
fulfill any potential obligation to the indemnified parties.  LICENSEE shall continue to maintain such
insurance or self-insurance during the term of this Agreement and after the
expiration or termination of this Agreement for a period of five (5) years.
 LICENSEE shall provide to ACT, upon
request, proof of any such insurance policy maintained by LICENSEE.

 

ARTICLE 9 - TERMINATION

 

9.1                                 The
term of this Agreement (“TERM”) shall commence on the Effective Date and
continue until the expiration of the last VALID CLAIM within the PATENT RIGHTS
to expire, unless sooner terminated as provided in this Article 9; provided
that LICENSEE’s obligation to pay royalties or Sublicense Income on NET SALES
in any country will terminate pursuant to Section 4.2(c) (subject to
LICENSEE’s obligations under Section 9.4 herein).

 

9.2                                 If
either party commits a material breach of a material term of this Agreement
(including any failure to make any payment due under this Agreement), the
non-breaching party shall have the right to terminate this Agreement effective
on thirty (30) days prior written notice to the party in breach, unless such
breach is cured prior to the expiration of such thirty (30) day period.

 

9.3                                 LICENSEE
shall have the right to terminate this Agreement at any time on thirty (30)
days prior notice to ACT, and upon payment of all amounts due ACT through the
effective date of the termination.

 

9.4.                              Notwithstanding
anything herein to the contrary, in the event that this Agreement is terminated
by ACT pursuant to Section 9.2 or by LICENSEE pursuant to Sections
9.2 or 9.3, LICENSEE shall retain a license to rights granted in Article 2
to the extent reasonably necessary to sell any LICENSED PRODUCTS existing or
under production and to perform LICENSED PROCESSES

 

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or LICENSED SERVICES
related to such LICENSED PRODUCTS or that are in process, subject to the terms
of this Agreement (including without limitation the obligation to pay royalties
under Article 4), provided that LICENSEE shall complete and sell
all such work-in-progress and inventory within six (6) months after the effective
date of termination.

 

9.5                                 Upon
the expiration of the TERM of this Agreement LICENSEE shall have a fully
paid-up, non-exclusive, irrevocable, royalty free license under the rights
granted in Article 2.

 

9.6                                 Nothing
herein shall be construed to release either party from any obligation that
accrued prior to expiration or any termination of this Agreement.  The following provisions shall survive any
termination of this Agreement: this Section 9.6 and Articles/Sections 1,
2, 4, 7, 8, 9.4, 10, 11, 12, 13,
14.3, 14.4, 14.7, 14.8, 14.9, 14.11 and 14.14, and any other provision which by
its nature is intended to survive any such termination.  The following provisions shall survive any
expiration of the TERM of this Agreement: this Section 9.6 and Articles/Sections
1, 2, 8, 9.4, 9.5, 10, 11, 12, 13, 14.3, 14.4, 14.7, 14.8, 14.9, 14.11 and
14.14, and any other provision which by its nature is intended to survive any
such expiration.

 

ARTICLE 10 - CONFIDENTIALITY AND NON-DISCLOSURE

 

10.1                           Confidential
Information; Non-Disclosure.  “Confidential
Information” shall mean any technical, business, financial, customer or other
information disclosed by one party (the “disclosing party”) to the other party
(the “receiving party”) pursuant to this Agreement which is marked “Confidential”
or “Proprietary,” or which, under all of the given circumstances, ought
reasonably to be treated as confidential information of the disclosing party.  Such information may be disclosed in oral,
visual or written form (including magnetic, optical or other media).  Except as expressly provided in Section 10.2
below, each party’s Confidential Information specifically includes without
limitation the respective party’s business plans and business practices, the
terms of this Agreement, scientific knowledge, research and development or
know-how, processes, inventions, techniques, formulae, products and product
plans, business operations, customer requirements, designs, sketches,
photographs, drawings, specifications, reports, studies, findings, data, plans
or other records, biological materials, software, margins, payment terms and
sales forecasts, volumes and activities, designs, computer code, technical
information, costs, pricing, financing, business opportunities, personnel, and
information of ACT or LICENSEE relating to the LICENSED PROCESSES, LICENSED
PRODUCTS or LICENSED SERVICES whether or not such information is marked,
identified or confirmed. Except to the extent expressly authorized by this
Agreement or by other prior written consent by the disclosing party, the
receiving party, during the term of this Agreement, and thereafter, shall: (i) treat
as confidential all Confidential Information of the other party; (ii) use
Confidential Information only for exercising the rights and fulfilling the
obligations set forth in this Agreement, (iii) implement reasonable
procedures to prohibit the disclosure, unauthorized duplication, misuse or
removal of the disclosing party’s Confidential Information; (iv) not
disclose Confidential Information to any third party, and (v) only
disclose the Confidential Information to (a) those of its employees who
have a need to know Confidential Information in order to exercise the rights
and fulfill the obligations set forth in this Agreement and (b) legal and
professional advisors and existing and potential investors and their legal and
professional advisors, each of which is bound by a written agreement (or in the
case of attorneys or other professional advisors, formal ethical duties)
requiring such advisors and investors to treat, hold and maintain such
Confidential Information in accordance with the terms and conditions of this
Agreement.  Without limiting the
foregoing, the receiving party shall protect the disclosing

 

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party’s Confidential
Information using at least the same procedures and degree of care that it uses
to prevent the disclosure of its own confidential information of like
importance, but in no event less than reasonable care.

 

10.2                           Exceptions.
 The receiving party shall have no
obligation or liability to the disclosing party with regard to any Confidential
Information of the disclosing party: (i) that was publicly known and
available at the time it was disclosed or becomes publicly known and available through
no fault, action, or inaction of the receiving party; (ii) was known to
the receiving party, without restriction, at the time of disclosure as shown by
the files of the receiving party in existence at the time of disclosure; (iii) is
disclosed with the prior written approval of the disclosing party; (iv) was
independently developed by the receiving party without any use of the
disclosing party’s Confidential Information, provided, that the receiving party
can demonstrate such independent development by documented evidence prepared
contemporaneously with such independent development; (v) is disclosed
pursuant to the order or requirement of a court, administrative agency, or
other governmental body, provided that the receiving party shall provide prompt
notice thereof and reasonable assistance to the disclosing party to enable the
disclosing party to seek a protective order or otherwise prevent such
disclosure, and provided further that such disclosure is limited to the extent
necessary to comply with such order and the information shall otherwise be
treated as Confidential Information; or (vi) that is provided to the
receiving party by an independent third party without violating any
confidentiality obligation to the disclosing party.

 

10.3                           Injunctive
Relief.  ACT and LICENSEE acknowledge
and agree that any breach of the confidentiality obligations imposed by this Section 10
will constitute immediate and irreparable harm to the disclosing party and/or
its successors and assigns, which cannot adequately and fully be compensated by
money damages and will warrant, in addition to all other rights and remedies
afforded by law, injunctive relief, specific performance, and/or other
equitable relief.  The disclosing party’s
rights and remedies hereunder are cumulative and not exclusive.  The disclosing party shall also be entitled to
receive from the receiving party the costs of enforcing this Article 10,
including reasonable attorneys’ fees and expenses of litigation.

 

10.4                           Termination.
 Upon termination or expiration of this
Agreement, or upon the request of the disclosing party at any time, the
receiving party shall promptly return to the disclosing party, at its request,
all copies of Confidential Information received from the disclosing party, and
shall return or destroy, and document the destruction of, all summaries,
abstracts, extracts, or other documents which contain any Confidential
Information of the disclosing party in any form.  Notwithstanding the foregoing to the contrary,
LICENSEE shall have no obligation (even upon a request by ACT) to return or
destroy any KNOW-HOW (including tangible embodiments of KNOW-HOW) during the
Term of this Agreement.

 

10.5                           Survival.
 The obligations of ACT and LICENSEE
under this Article 10 shall survive any expiration or termination of this
Agreement.

 

ARTICLE 11 - PAYMENTS, NOTICES, AND OTHER
COMMUNICATIONS

 

Any
payment, notice or other communication pursuant to this Agreement shall be in
writing and sent by certified first class mail, postage prepaid, return receipt
requested, or by nationally recognized overnight carrier addressed to the
parties at the following addresses or such other addresses

 

10

 

as such party furnishes
to the other party in accordance with this paragraph.  Such notices, payments, or other
communications shall be effective upon receipt.

 

In
the case of ACT:

 

Advanced
Cell Technology, Inc.

One
Innovation Drive

Worcester,
MA 01605

Attention:
Michael D. West, Ph.D., President

 

With
a copy to:

 

Pierce
Atwood

One
Monument Square

Portland,
ME 04101

Attention:
William L. Worden, Esq.

 

In
the case of LICENSEE:

 

First
Degree Genetics, LLC

18
Plimpton Road

Westerly,
R.I.02891

Attention:
Robert Saglio

 

With a copy to:                                     Goodwin
Procter LLP

Exchange
Place

53
State Street

Boston,
MA 02109

Attention:
Andrew F. Viles, P.C.

 

ARTICLE 12 - RESPRESENTATIONS AND WARRANTIES;
DISCLAIMER

 

12.1                           ACT
represents and warrants that it owns or has licensed with a sublicensable
interest the PATENT RIGHTS and KNOW-HOW, that it has the full legal right and
power to grant the licenses granted hereunder, that this Agreement constitutes
the binding legal obligation of ACT, enforceable in accordance with its terms
and that the execution and performance of this Agreement by ACT will not violate,
contravene or conflict with any other agreement to which ACT is a party or by
which it is bound or with any law, rule or regulation applicable to ACT.

 

12.2                           LICENSEE
represents and warrants that it has full corporate power and authority to enter
into this Agreement, that this Agreement constitutes the binding legal
obligation of LICENSEE and that execution and performance of this Agreement by
LICENSEE will not violate, contravene or conflict with any other agreement to
which LICENSEE is a party or by which it is bound or with any law, rule or
regulation applicable to LICENSEE.

 

12.3                           EXCEPT
AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, ACT, ITS DIRECTORS,
OFFICERS, EMPLOYEES, AND AFFILIATES MAKE NO REPRESENTATIONS AND EXTEND NO
WARRANTIES OF ANY KIND, EITHER EXPRESS OR

 

11

 

IMPLIED, INCLUDING BUT
NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
VALIDITY OF PATENT RIGHTS, ISSUED OR PENDING, AND THE ABSENCE OF LATENT OR
OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE.  NOTHING IN THIS AGREEMENT SHALL BE CONSTRUED
AS A REPRESENTATION MADE OR WARRANTY GIVEN BY ACT THAT THE PRACTICE BY LICENSEE
OF THE LICENSE GRANTED HEREUNDER SHALL NOT INFRINGE THE PATENT RIGHTS OF ANY
THIRD PARTY.

 

ARTICLE 13 - LIMITATION OF LIABILITY

 

13.1                           EXCEPT
FOR ANY LIABILITY TO ANY THIRD PARTIES PURSUANT TO ARTICLE 8 OF THIS
AGREEMENT, IN NO EVENT SHALL ACT OR LICENSEE OR THEIR, ITS DIRECTORS, OFFICERS,
EMPLOYEES OR AFFILIATES BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF
ANY KIND, INCLUDING ECONOMIC DAMAGE OR INJURY TO PROPERTY AND LOST PROFITS,
REGARDLESS OF WHETHER ACT OR LICENSEE SHALL BE ADVISED, SHALL HAVE OTHER REASON
TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY OF SUCH DAMAGES.

 

ARTICLE 14 - MISCELLANEOUS PROVISIONS

 

14.1                           LICENSEE
shall comply with all local, state, federal and international laws and
regulations relating to the development, manufacture, use, provision, and sale
of LICENSED PRODUCTS, LICENSED PROCESSES and LICENSED SERVICES.  Without limiting the generality of the
foregoing, LICENSEE agrees to comply with the following:

 

(a)                                  LICENSEE
shall obtain all necessary approvals from the FDA, USDA, or any similar
governmental authorities of any foreign jurisdiction in which LICENSEE intends
to make, use, or sell LICENSED PRODUCTS or to perform LICENSED PROCESSES or
LICENSED SERVICES.

 

(b)                                 LICENSEE
shall comply fully with any and all applicable local, state, federal and
international laws and regulations relating to the LICENSED PRODUCTS, LICENSED
PROCESSES and LICENSED SERVICES, and the PATENT RIGHTS, in the TERRITORY,
including without limitation all export or import regulations and rules now
in effect or as may be issued from time to time by any governmental authority
which has jurisdiction relating to the export of LICENSED PRODUCTS, LICENSED
PROCESSES or LICENSED SERVICES and any technology relating thereto.  LICENSEE hereby gives written assurance that
it will comply with all such import or export laws and regulations (including
without limitation all Export Administration Regulations of the United States
Department of Commerce), that it bears sole responsibility for any violation of
such laws and regulations, and that it will indemnify, defend, and hold ACT and
the University harmless (in accordance with Article 8) for the
consequences of any such violation.

 

(c)                                  To
the extent that any invention claimed in the PATENT RIGHTS has been partially
funded by the United States Government, and only to the extent required by
applicable laws and regulations, LICENSEE agrees that any LICENSED PRODUCTS
used or sold in the United States will be manufactured substantially in the
United States or its territories.  Current
law provides that if a domestic manufacturer is not commercially feasible under
the circumstances, ACT and/or the University may seek a waiver of this
requirement from the relevant federal agency on behalf of

 

12

 

LICENSEE and, upon
LICENSEE’S request, shall cooperate with LICENSEE in seeking such a waiver.

 

14.2                           LICENSEE
shall not create or incur or cause to be incurred or to exist any lien,
encumbrance, pledge, charge, restriction or other security interest of any kind
upon the PATENT RIGHTS.

 

14.3                           Neither
party shall originate any publicity, news release or other public announcement
(“Announcements”), written or oral, relating to this Agreement or the existence
of an arrangement between the parties, without the prior written approval of
the other party, which approval shall not be unreasonably withheld or delayed,
except as otherwise required by law.  Any
references to the University in such Announcements shall be subject to the
approval of the University.  The
foregoing notwithstanding, ACT and LICENSEE shall have the right to make such Announcements
without the consent of the other party or the University, as applicable, in any
prospectus, offering memorandum, or other document or filing required by
applicable securities laws or other applicable law or regulation, provided that
such party shall have given the other party or the University, as applicable,
at least ten (10) days prior written notice of the proposed text for the
purpose of giving the other party or the University, as applicable, the
opportunity to comment on such text.

 

14.4                           No
implied licenses are granted pursuant to the terms of this Agreement.  No licensed rights shall be created by
implication or estoppel.

 

14.5                           Nothing
herein shall be deemed to constitute either party as the agent or
representative of the party, or both parties as joint venturers or partners for
any purpose.  Each party shall be an
independent contractor, not an employee or partner of the other party, and the
manner in which each party renders its services under this Agreement shall be
within its sole discretion.  Neither
party shall be responsible for the acts or omissions of the other party, nor
shall either party have authority to speak for, represent or obligate the other
party in any way without prior written authority from the other party.

 

14.6                           To the
extent commercially feasible, and consistent with prevailing business practices
and applicable law, all LICENSED PRODUCTS sold pursuant to this Agreement will
be marked with the number of each issued patent that applies to such LICENSED
PRODUCTS.

 

14.7                           This
Agreement shall be construed, governed, interpreted and applied in accordance
with the laws of the Commonwealth of Massachusetts, U.S.A. without regard to
principles of conflicts of law thereof, except that questions affecting the
construction and effect of any patent shall be determined by the law of the
country in which the patent was granted.

 

14.8                           The
parties hereto acknowledge that this Agreement sets forth the entire Agreement
and understanding of the parties hereto as to the subject matter hereof, and
shall not be subject to any change or modification except by the execution of a
written instrument signed by the parties hereto.

 

14.9                           The provisions
of this Agreement are severable, and in the event that any provision of this
Agreement shall be determined to be invalid or unenforceable under any
controlling body of the law, such invalidity or unenforceability shall not in
any way affect the validity or enforceability of the remaining provisions
hereof.

 

13

 

14.10                     The failure
of either party to assert a right hereunder or to insist upon compliance with
any term or condition of this Agreement shall not constitute a waiver of that
right or excuse a similar subsequent failure to perform any such term or condition
by the other party.

 

14.11                     This
Agreement may not be assigned by LICENSEE without the prior written consent of
ACT, which consent shall be granted or denied in ACT’s sole discretion.  ACT may not assign this Agreement without the
consent of LICENSEE, which consent shall not be unreasonably withheld or
delayed, except that ACT may assign this Agreement to an affiliate or to a
successor in connection with the merger, consolidation, or sale of all or
substantially all of its assets or that portion of its business to which this
Agreement relates.  Notwithstanding the
foregoing to the contrary, this restriction on the assignment by LICENSEE of
this Agreement shall not prevent the assignment of this Agreement in connection
with a sale of all or substantially all of the assets of LICENSEE, so long as
the purchaser of the assets agrees to assume any and all outstanding
liabilities to LICENSOR under this Agreement, including but not limited to any
outstanding amounts under the promissory note referred to in paragraph 4.1.

 

14.12                     This
Agreement has been prepared jointly and no rule of strict construction
shall be applied against either party.  In
this Agreement, the singular shall include the plural and vice versa and the
word “including” shall be deemed to be followed by the phrase “without
limitation.”  The section headings
contained in this Agreement are inserted for convenience only and shall not
affect in any way the meaning or interpretation of this Agreement.

 

14.13                     This
Agreement may be executed in counterparts, each of which together shall
constitute one and the same Agreement.

 

14.14                     All rights
and licenses granted under or pursuant to this Agreement by ACT to LICENSEE
are, and shall otherwise be deemed to be, for purposes of Paragraph 365(n) of
the U.S. Bankruptcy Code (the “Code”), licenses to rights in “intellectual
property” as defined in the Code.  The
parties hereto agree that LICENSEE, as a licensee of such rights under this
Agreement, shall retain and may fully exercise all of its rights and elections
under the Code.  The parties hereto
further agree that, in the event of the commencement of a bankruptcy proceeding
by or against ACT including a proceeding under the Code, LICENSEE shall be
entitled to a complete duplicate of (or complete access to, as appropriate) any
such intellectual property and all embodiments of such intellectual property,
including the PATENT RIGHTS and KNOW-HOW, and the same, if not already in
LICENSEE’s possession, shall be promptly delivered to LICENSEE upon any such
commencement of a bankruptcy proceeding upon written request therefore by
LICENSEE.

 

IN
WITNESS WHEREOF, the parties have duly executed this Agreement on the EFFECTIVE
DATE.

 

	
  ADVANCED CELL
  TECHNOLOGY, INC.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Michael D. West

  	
   

  
	
  Printed Name:

  	
  Michael D. West, Ph.D.

  
	
  Title:

  	
  President &
  Chief Executive Officer

  
					

 

14

 

	
  FIRST DEGREE GENETICS,
  LLC

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Robert Saglio

  	
   

  
	
  Printed Name:

  	
  Robert Saglio

  
	
  Title:

  	
  President

  
					

 

15Exhibit 10.17

 

NON-EXCLUSIVE
LICENSE AGREEMENT

 

This
Non-Exclusive License Agreement (“Agreement”) is made and entered into this 3rd
day of February, 2004 (the “Effective Date”), by and between Advanced Cell
Technology, Inc., a Delaware corporation with offices located at One
Innovation Drive, Worcester, Massachusetts 01605 (“ACT”), and One Degree
Genetics LLC, a Delaware limited liability company with offices located at 18
Plimpton Road, Westerly, R.I. 02891 (“LICENSEE”) (ACT and LICENSEE sometimes
hereinafter referred to as the “parties”).

 

WITNESSETH

 

WHEREAS,
Robert Saglio, the principal of LICENSEE (“Saglio”), has been employed by ACT’s
parent company A.C.T. Group, Inc. (“Group”) as an executive; and

 

WHEREAS,
Saglio’s employment with Group terminated on August 8, 2002; and

 

WHEREAS,
in connection with the termination of Saglio’s employment by Group Saglio and
Group entered into a letter agreement dated July 22, 2002 (the “Letter
Agreement”), a copy of which is attached hereto as Exhibit A; and

 

WHEREAS,
in connection with the termination of Saglio’s employment by Group Saglio and
Group entered into a General Release and Indemnification Agreement dated February 3,
2004 (the “Release”), a copy of which is attached hereto as Exhibit B;
and

 

WHEREAS,
ACT owns or has licensed with a sublicensable interest the PATENT RIGHTS (as
defined below) and KNOW-HOW (as defined below); and

 

WHEREAS,
Saglio owns directly more than fifty percent (50%) of LICENSEE; and

 

WHEREAS,
Saglio desires to obtain for LICENSEE a nonexclusive license from ACT in and
under the PATENT RIGHTS and KNOW-HOW; and

 

WHEREAS,
the Letter Agreement contemplates that ACT will grant such a license to
LICENSEE; and

 

WHEREAS,
ACT is willing to grant such a license to LICENSEE upon the terms and conditions
set forth below; and

 

NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
herein, the parties hereto agree as follows:

 

ARTICLE 1 - DEFINITIONS

 

For
the purposes of this Agreement, the following words and phrases shall have the
following meanings:

 

 

1.1                                 “FIELD
OF NUTRACEUTICALS” means the developing, making, using, selling, offering to
sell or importing of products that are composed of, made in or derived,
extracted or isolated from transgenic animals (including transgenic animals
which have been cloned) containing one or more genes not naturally present in
such animal, where such gene’s product serves to prevent or treat a human
disease, for all purposes related to medical therapies (i.e., therapies for the prevention or
treatment of human disease), including but not limited to the production of
biopharmaceutical agents, proteins, peptides and polypeptides for
pharmaceutical, nutraceutical or other use.

 

1.2                                 “KNOW-HOW”
means all compositions of matter, techniques and data and other know-how and
technical information including inventions (whether or not patentable),
improvements and developments, practices, methods, concepts, trade secrets,
documents, computer data, computer code, apparatus, clinical and regulatory
strategies, test data, analytical and quality control data, formulation,
manufacturing, patent data or descriptions, development information, drawings,
specifications, designs, plans, proposals and technical data and manuals and
all other proprietary information that is owned or controlled by ACT as of the
Effective Date that relates to cloning technology or to any of the subject
matter described in or claimed by the PATENT RIGHTS and is relevant to the
FIELD OF NUTRACEUTICALS.

 

1.3                                 “LICENSED
PROCESS” means any process or method, the researching, developing, using,
practicing, selling, offering for sale, importing or exporting of which by
LICENSEE would, but for the licenses granted to LICENSEE in Article 2
of this Agreement, infringe a VALID CLAIM of the PATENT RIGHTS in the country
in which such process or method is researched, developed, practiced, sold,
offered for sale, imported or exported.

 

1.4                                 “LICENSED
PRODUCT” means (a) any product, the making, using, selling, offering for
sale, importing or exporting of which by LICENSEE, would, but for the licenses
granted to LICENSEE in Article 2 of this Agreement, infringe a
VALID CLAIM of the PATENT RIGHTS in the country in which any such product is so
made, used, sold, offered for sale, imported or exported by LICENSEE or (b) any
product that is made by LICENSEE using a process or method that would, but for
the licenses granted to LICENSEE in Article 2 of this Agreement,
infringe a VALID CLAIM of the PATENT RIGHTS in the country in which any such
process or method is used.

 

1.5                                 “LICENSED
SERVICES” means any service, the developing, using, performing, selling,
offering for sale, importing or exporting of which by LICENSEE would, but for
the licenses granted to LICENSEE in Article 2 of this Agreement,
infringe a VALID CLAIM of the PATENT RIGHTS in the country in which any such
service is so developed, used, performed, sold, offered for sale, imported or
exported by LICENSEE.

 

1.6                                 “LICENSEE”
means One Degree Genetics LLC, a Delaware limited liability company with
offices located at         18 Plimpton Road,
Westerly, R.I. 02891.

 

1.7                                 “NET
SALES” shall mean the amount billed or invoiced by LICENSEE for the sale or
provision of LICENSED PRODUCTS or LICENSED PROCESSES or LICENSED SERVICES less:

 

(a)                                  discounts
allowed;

 

(b)                                 sales,
tariff duties, use and other taxes directly imposed with reference to

 

2

 

particular sales;

 

(c)                                  special
packaging, transportation and insurance prepaid or allowed; and

 

(d)                                 amounts
allowed or credited on returns.

 

1.8                                 “PATENT
RIGHTS” means (a) the patent applications and patents identified on Exhibit C
attached hereto and any patents that issue on said applications and (b) any
divisions, continuations, continuations-in-part, extensions, reissues or reexaminations
of any of the patents identified in the foregoing clause (a).  The parties agree that Exhibit C
may be revised from time to time after the Effective Date to reflect changes
thereto.

 

1.9                                 “TERM”
has the meaning set forth in Section 8.1.

 

1.10                           “TERRITORY”
means the entire world.

 

1.11                           “UMASS
LICENSE” means the Exclusive License Agreement between ACT and the University
of Massachusetts, dated April 16, 1996, as amended by the Amendment to
Exclusive License Agreement dated September 1, 1999, the Second Amendment
to Exclusive License Agreement dated May 31, 2000, and the Third Amendment
to Exclusive License Agreement dated September 19, 2002.

 

1.12                           “VALID
CLAIM” means a claim of any issued and unexpired patent within the PATENT
RIGHTS which has not lapsed, become abandoned or been held revoked, invalid, or
unenforceable by a decision of a court or administrative or government
authority or agency of competent jurisdiction from which no appeal can be or
has been taken within the time allowed for such appeal, and which has not been
admitted to be invalid or unenforceable through reissue, disclaimer or
otherwise.

 

Additional
terms may be defined throughout this Agreement

 

ARTICLE 2 - GRANT

 

2.1                                 ACT
hereby grants to LICENSEE, and LICENSEE hereby accepts, subject to the terms
and conditions hereof, a royalty bearing, nonexclusive license in the TERRITORY
in the FIELD OF NUTRACEUTICALS and under the PATENT RIGHTS and KNOW-HOW to (a) research,
develop, make, have made, use, sell, have sold, offer for sale, have offered
for sale, import, have imported, export and have exported LICENSED PRODUCTS, (b) research,
develop, use, practice, sell, have sold, offer for sale, have offered for sale,
import, have imported, export and have exported LICENSED PROCESSES and (c) develop,
use, perform, sell, have sold, offer for sale, have offered for sale, import,
have imported, export and have exported LICENSED SERVICES.  LICENSEE shall have the right, in connection
with the licenses to “have made,” “have sold,” “have offered for sale,” “have
imported” and “have exported” to sublicense the rights granted in this Section 2.1
to third parties in connection with contracting with such third parties to (x)
provide LICENSED PRODUCT marketing and distribution services to LICENSEE on
behalf of LICENSEE, (y) provide Licensed Services marketing services to
LICENSEE on behalf of LICENSEE or (z) manufacture for LICENSEE LICENSED
PRODUCTS for sale by LICENSEE or a third party pursuant to the foregoing clause
(x).

 

3

 

2.2                                 Except
as expressly provided by Section 2.1 above, LICENSEE shall not have the
right to grant sublicenses without the express prior written approval of ACT,
which approval shall be granted or denied in ACT’s sole discretion.

 

2.3                                 Within
thirty (30) business days of the Effective Date, ACT shall provide and transfer
to LICENSEE all information and data relating to the PATENT RIGHTS and KNOW-HOW
as may be reasonably necessary to allow LICENSEE to exploit the licenses
granted hereunder.

 

2.4                                 LICENSEE
acknowledges that a portion of the PATENT RIGHTS licensed to LICENSEE hereunder
is owned by the University and is licensed to ACT under the UMASS LICENSE.  In the event the UMASS LICENSE expires or is
terminated for any reason pursuant to the provisions of the UMASS LICENSE or
otherwise, the terms of the letter agreement attached hereto as Exhibit D
between ACT, LICENSEE and the University shall apply to this Agreement.

 

ARTICLE 3 - LICENSEEE OBLIGATIONS

RELATING TO COMMERCIALIZATION

 

3.1                                 LICENSEE
shall use its commercially reasonable and diligent efforts to bring one or more
LICENSED PRODUCTS, LICENSED PROCESSES or LICENSED SERVICES to market through an
active and diligent program for exploitation of the PATENT RIGHTS and to
continue active, diligent marketing efforts for one or more LICENSED PRODUCTS,
LICENSED PROCESSES or LICENSED SERVICES throughout the Term of this Agreement.

 

3.2                                 LICENSEE
shall maintain complete and accurate records of LICENSED PRODUCTS, LICENSED
PROCESSES and LICENSED SERVICES that are made, used, sold or performed by
LICENSEE under this Agreement.  Not later
than May 1st of each year following the Effective Date,
LICENSEE shall furnish ACT with a summary report on the progress of its efforts
during the prior year to develop and commercialize LICENSED PRODUCTS, LICENSED
PROCESSES or LICENSED SERVICES, including without limitation research and
development efforts, efforts to obtain regulatory approval, marketing efforts
(including LICENSED PRODUCTS, LICENSED PROCESSES and LICENSED SERVICES made,
used, sold or performed) and sales figures, provided that such reports shall be
deemed Confidential Information (as defined in Section 10.1 herein)
subject to the provisions of Article 10 of this Agreement.

 

3.3                                 In
the event that ACT determines that LICENSEE has not fulfilled its obligations
under this Article 3, ACT shall furnish LICENSEE with written notice of
such determination.  Within sixty (60)
days after receipt of such notice, LICENSEE shall either (i) fulfill the
relevant obligation or (ii) negotiate with ACT a mutually acceptable schedule of
revised obligations; failing which ACT shall have the right, immediately upon
written notice to ACT, to terminate this Agreement.

 

ARTICLE 4 - CONSIDERATION

 

4.1                                 Initial
Payment.  In partial consideration of
the license granted to LICENSEE from ACT in Article 2 of this Agreement,
LICENSEE agrees to pay a “License Fee” to ACT, by delivery by

 

4

 

LICENSEE within thirty
(30) days after the Effective Date, of a convertible promissory note in the
form attached hereto as Exhibit E

 

4.2                                 Royalties.

 

(a)                                  In
partial consideration of the license in the FIELD OF NUTRACEUTICALS granted by
ACT to LICENSEE in Article 2 of this Agreement, LICENSEE agrees to pay to
ACT an earned royalty equal to five percent (5%) of the NET SALES in the FIELD
OF NUTRACEUTICALS made, used, sold, imported, exported or performed by LICENSEE
in the TERRITORY.

 

(b)                                 No
multiple royalties shall be payable because any LICENSED PRODUCT, LICENSED
PROCESS or LICENSED SERVICE in the FIELD OF NUTRACEUTICALS, its manufacture,
use, lease, sale or performance are or shall be covered by more than one patent
or patent application within the PATENT RIGHTS.

 

(c)                                  The
obligation of LICENSEE to pay royalties or Sublicense Income (as defined in Section 4.3
herein) hereunder shall terminate for each country in the TERRITORY
concurrently with the expiration or termination of the last applicable VALID
CLAIM within the PATENT RIGHTS in such country in which the LICENSED PRODUCT,
LICENSED PROCESS or LICENSED SERVICE is, (as applicable), used, practiced,
performed, sold, offered for sale, imported, exported or manufactured.

 

4.3                                 Sublicense
Income.  LICENSEE shall pay to ACT a
total of twenty-seven and one-half percent (27.5%) of all Sublicense Income.  “Sublicense Income” means consideration that
LICENSEE receives for the sublicense of rights that are granted LICENSEE under Article 2,
approved in writing by ACT, including without limitation license fees, milestone
payments, equity payments, up front fees, success fees, and license maintenance
fees.

 

4.4                                 Payments
in U.S. Currency.  All payments due
under this Agreement shall be paid in cash to ACT and all payments shall be
made in United States currency.  Conversion
of foreign currency to U.S. dollars shall be made at the conversion rate reported
in The Wall Street Journal on the last working day of the calendar
quarter to which the payment relates.

 

4.5                                 Taxes.
 All payments due hereunder shall be paid
in full without deduction of taxes or other fees which may be imposed by any
government and which shall be paid by LICENSEE; provided, however, that any
withholding tax required to be withheld by LICENSEE on royalty payments under
the laws of any country in the TERRITORY on behalf of ACT will be timely paid
by LICENSEE to the appropriate governmental authority, and LICENSEE will
furnish ACT with proof of payment of such tax.  Any such tax actually withheld may be deducted
from royalty payments due to ACT under this Agreement.  If at any time legal restrictions prevent the
prompt remittance of part or all of any payments owed by LICENSEE to ACT
hereunder with respect to any country in the TERRITORY, payment shall be made
through any lawful means or methods that may be available, and as LICENSEE
shall reasonably determine is appropriate.

 

4.6                                 Overdue
Payments.  Any payments to be made by
LICENSEE hereunder that are not paid on or before the date such payments are
due under this Agreement shall bear interest, to the extent permitted by law,
at two percentage points above the Prime Rate of interest as reported in The
Wall

 

5

 

Street Journal
on the date payment is due, with interest calculated based on the number of
days that payment is delinquent.

 

ARTICLE 5 - REPORTS AND RECORDS

 

5.1                                 LICENSEE
shall keep full, true and accurate books of account containing all particulars
that may be necessary for the purpose of showing the amounts payable to ACT
hereunder and to enable the reports provided under Section 5.2 to
be verified.  Said books of account shall
be kept at LICENSEE’s principal place of business.  Said books and the supporting data shall be
open upon reasonable advance notice (but not less than five (5) business
days notice and no more frequently than once per calendar year) for three (3) years
following the end of the calendar year to which they pertain, to the inspection
of ACT or its agents for the purpose of verifying LICENSEE’s royalty and
Sublicense Income statement or compliance in other respects with this Agreement.
 If any such audit determines an error in
any royalty or Sublicense Income payment, LICENSEE shall pay to ACT, within
thirty (30) days of the discovery of the error, (a) all deficiencies in
royalty or Sublicense Income payments, (b) interest on such deficiencies
from the date such royalty or Sublicense Income payment was due until the date
paid at the rate set forth in Section 4.6 above, and (c) if such
error is in excess of five percent (5%) of any royalty or Sublicense Income
payment, the cost of the audit.  In all
other cases, the costs of the audit shall be paid for by ACT.  All information disclosed pursuant to an audit
shall be treated as Confidential Information (as defined in Section 10.1
herein) and shall not be disclosed to any third party or used for any purpose
other than to determine the correctness of LICENSEE’s royalty and Sublicense
Income statement or compliance in other respects with this Agreement.

 

5.2                                 After
the first commercial sale of a LICENSED PRODUCT or LICENSED PROCESS, LICENSEE,
within forty-five (45) days after March 31, June 30, September 30
and December 31 of each year, shall deliver to ACT a true and accurate
report, giving such particulars of the business conducted by LICENSEE and its
permitted sublicensees during the preceding three-month period under this
Agreement as shall be pertinent to a royalty and Sublicense Income accounting
hereunder.  Without limiting the
generality of the foregoing, these reports shall include at least the
following:

 

(a)                                  the
number of LICENSED PRODUCTS manufactured and sold by LICENSEE and all
sublicensees;

 

(b)                                 total
billings and the amounts actually received for LICENSED PRODUCTS sold by
LICENSEE and all sublicensees;

 

(c)                                  an
accounting for all LICENSED PROCESSES or LICENSED SERVICES used in the
provision of services to others or sold by LICENSEE;

 

(d)                                 the
deductions applicable as provided in Section 1.11; and

 

(e)                                  the
names and addresses of all parties making LICENSED PRODUCTS on behalf of
LICENSEE.

 

The reports shall provide
the above-identified information by animal.

 

5.3                                 With
each such report submitted, LICENSEE shall pay to ACT the royalties and

 

6

 

Sublicense Income due and
payable for such three-month period.  If
no royalties or Sublicense Income shall be due, LICENSEE shall so report.

 

ARTICLE 6 - PATENT PROSECUTION

 

6.1                                 ACT
shall be solely responsible for the continued prosecution of pending patent
applications included in the PATENT RIGHTS and the issuance of such
applications after allowance.  Additionally,
ACT shall pay all government fees in any given country required to maintain the
PATENT RIGHTS; and shall submit evidence to LICENSEE upon request that such
fees have been timely paid.  The prosecution,
filing and maintenance of all patents and applications shall be the primary
responsibility of ACT.  LICENSEE agrees
to cooperate fully with ACT, as requested by ACT and at ACT’s expense, in the
preparation, filing, prosecution, and maintenance of the patent applications
and patents included in the PATENT RIGHTS.

 

ARTICLE 7 - PROSECUTION OF INFRINGERS

AND DEFENSE OF PATENT RIGHTS

 

The
parties agree to notify each other in writing of any actual or threatened
infringement by a third party of Patent Rights or of any claim of invalidity,
unenforceability, or non-infringement of the Patent Rights.  ACT shall have the sole responsibility to
prosecute or defend such claims, as applicable.  LICENSEE shall if requested provide reasonable
assistance to ACT, at ACT’s expense, in connection with the prosecution or
defense of such claims.

 

ARTICLE 8 - INDEMNIFICATION

 

8.1                                 LICENSEE
shall at all times during the term of this Agreement and thereafter, indemnify,
defend and hold harmless ACT and the University and their trustees, directors,
officers, employees and affiliates (collectively, the “Indemnified Parties”)
against all liabilities of any kind whatsoever, including legal expenses and
reasonable attorneys’ fees (excluding, pursuant to Article 13 hereof, any
special, indirect, reliance, incidental, exemplary, cover or consequent damages
suffered or incurred by any of the Indemnified Parties directly (as opposed to
any special, indirect, reliance, incidental, exemplary, cover or consequential
damages suffered or incurred by third parties who are, in turn, seeking the
same from the Indemnified Parties, which shall be covered by the indemnity set
forth herein)), incurred or imposed upon any of the Indemnified Parties in
connection with or as a consequence of any claims (including third party
claims), suits, actions, demands or judgments arising out of the death of or
injury to any person or persons or out of any damage to property resulting from
the development, production, manufacture, sale, use, performance, rendering,
consumption or advertisement of the LICENSED PRODUCT(s) and/or LICENSED
PROCESS(es) or arising from any obligation, act or omission performed or failed
to be performed hereunder, or from a breach of any representation or warranty
of LICENSEE hereunder, excepting only claims that the PATENT RIGHTS or the
exercise thereof infringe third party intellectual property or claims that
result from any breach by ACT of this Agreement.

 

8.2                                 If
the exercise of LICENSEE’s rights under this Agreement in any country in the
TERRITORY is the subject of a bona fide claim by a third party, filed in a
court of competent jurisdiction after the date hereof, that the exercise of
such rights infringes or conflicts with any intellectual property rights of
such third party (a “Third Party Infringement Claim”), then LICENSEE

 

7

 

shall not have any of the
rights granted herein in such country and shall have no obligation to pay ACT
any further payments under Article 4 of this Agreement with respect to any
country of the TERRITORY until such claim is resolved by proper adjudication or
settlement permitting LICENSEE to exercise LICENSEE’s rights under this
Agreement in the applicable country of the TERRITORY.  Notwithstanding anything herein to the
contrary, ACT covenants that it will not (a) assert or bring any suit,
action, claim or other proceeding against LICENSEE based on, in whole or in
part, LICENSEE’s exercise of LICENSEE’s rights, in accordance with the terms
and conditions of this Agreement, with respect to the PATENT RIGHTS and/or KNOW_HOW
and/or (b) join in any third party suit, action, claim or other proceeding
against LICENSEE based on, in whole or in part, any intellectual property
rights (including without limitation, patent rights and/or know how) owned by
the applicable third party, so long as LICENSEE is not in violation of this
Agreement.

 

8.3                                 Any
indemnification obligations set forth in this Agreement shall be subject to the
following conditions: (i) the indemnified party shall notify the
indemnifying party in writing promptly upon learning of any claim or suit for
which indemnification is sought; (ii) the indemnifying party shall have
control of the defense or settlement, provided that the indemnified
party shall have the right (but not the obligation) to participate in such
defense or settlement with counsel at its selection and at its sole expense;
and (iii) the indemnified party shall reasonably cooperate with the
defense, at the indemnifying party’s expense.

 

8.4                                 LICENSEE
agrees to maintain insurance or self-insurance that is reasonably adequate to
fulfill any potential obligation to the indemnified parties.  LICENSEE shall continue to maintain such
insurance or self-insurance during the term of this Agreement and after the
expiration or termination of this Agreement for a period of five (5) years.
 LICENSEE shall provide to ACT, upon
request, proof of any such insurance policy maintained by LICENSEE.

 

ARTICLE 9 – TERMINATION

 

9.1                                 The
term of this Agreement (“TERM”) shall commence on the Effective Date and
continue until the expiration of the last VALID CLAIM within the PATENT RIGHTS
to expire, unless sooner terminated as provided in this Article 9;
provided that LICENSEE’s obligation to pay royalties or Sublicense Income on
NET SALES in any country will terminate pursuant to Section 4.2(c) (subject
to LICENSEE’s obligations under Section 9.4 herein).

 

9.2                                 If
either party commits a material breach of a material term of this Agreement
(including any failure to make any payment due under this Agreement), the
non-breaching party shall have the right to terminate this Agreement effective
on thirty (30) days prior written notice to the party in breach, unless such
breach is cured prior to the expiration of such thirty (30) day period.

 

9.3                                 LICENSEE
shall have the right to terminate this Agreement at any time on thirty (30)
days prior notice to ACT, and upon payment of all amounts due ACT through the
effective date of the termination.

 

9.4.                              Notwithstanding
anything herein to the contrary, in the event that this Agreement is terminated
by ACT pursuant to Section 9.2 or by LICENSEE pursuant to Sections
9.2 or 9.3, LICENSEE shall retain a license to rights granted in Article 2
to the extent reasonably necessary to sell any LICENSED PRODUCTS existing or
under production and to perform LICENSED PROCESSES

 

8

 

or LICENSED SERVICES
related to such LICENSED PRODUCTS or that are in process, subject to the terms
of this Agreement (including without limitation the obligation to pay royalties
under Article 4), provided that LICENSEE shall complete and sell
all such work-in-progress and inventory within six (6) months after the
effective date of termination.

 

9.5                                 Upon
the expiration of the TERM of this Agreement LICENSEE shall have a fully
paid-up, non-exclusive, irrevocable, royalty free license under the rights
granted in Article 2.

 

9.6                                 Nothing
herein shall be construed to release either party from any obligation that
accrued prior to expiration or any termination of this Agreement.  The following provisions shall survive any
termination of this Agreement: this Section 9.6 and Articles/Sections 1, 2,
4, 7, 8, 9.4, 10, 11, 12, 13, 14.3, 14.4, 14.7, 14.8, 14.9, 14.11 and 14.14,
and any other provision which by its nature is intended to survive any such
termination.  The following provisions
shall survive any expiration of the TERM of this Agreement: this Section 9.6
and Articles/Sections 1, 2, 8, 9.4, 9.5, 10, 11, 12, 13, 14.3, 14.4, 14.7,
14.8, 14.9, 14.11 and 14.14, and any other provision which by its nature is
intended to survive any such expiration.

 

ARTICLE 10 – CONFIDENTIALITY AND NON-DISCLOSURE

 

10.1                           Confidential
Information; Non-Disclosure.  “Confidential
Information” shall mean any technical, business, financial, customer or other
information disclosed by one party (the “disclosing party”) to the other party
(the “receiving party”) pursuant to this Agreement which is marked “Confidential”
or “Proprietary,” or which, under all of the given circumstances, ought
reasonably to be treated as confidential information of the disclosing party.  Such information may be disclosed in oral,
visual or written form (including magnetic, optical or other media).  Except as expressly provided in Section 10.2
below, each party’s Confidential Information specifically includes without
limitation the respective party’s business plans and business practices, the
terms of this Agreement, scientific knowledge, research and development or
know-how, processes, inventions, techniques, formulae, products and product
plans, business operations, customer requirements, designs, sketches,
photographs, drawings, specifications, reports, studies, findings, data, plans
or other records, biological materials, software, margins, payment terms and
sales forecasts, volumes and activities, designs, computer code, technical
information, costs, pricing, financing, business opportunities, personnel, and
information of ACT or LICENSEE relating to the LICENSED PROCESSES, LICENSED
PRODUCTS or LICENSED SERVICES whether or not such information is marked,
identified or confirmed.  Except to the
extent expressly authorized by this Agreement or by other prior written consent
by the disclosing party, the receiving party, during the term of this Agreement,
and thereafter, shall: (i) treat as confidential all Confidential
Information of the other party; (ii) use Confidential Information only for
exercising the rights and fulfilling the obligations set forth in this
Agreement, (iii) implement reasonable procedures to prohibit the
disclosure, unauthorized duplication, misuse or removal of the disclosing party’s
Confidential Information; (iv) not disclose Confidential Information to
any third party, and (v) only disclose the Confidential Information to (a) those
of its employees who have a need to know Confidential Information in order to
exercise the rights and fulfill the obligations set forth in this Agreement and
(b) legal and professional advisors and existing and potential investors
and their legal and professional advisors, each of which is bound by a written
agreement (or in the case of attorneys or other professional advisors, formal
ethical duties) requiring such advisors and investors to treat, hold and
maintain such Confidential Information in accordance with the terms and
conditions of this Agreement. Without limiting the foregoing, the receiving
party shall protect the disclosing

 

9

 

party’s Confidential
Information using at least the same procedures and degree of care that it uses
to prevent the disclosure of its own confidential information of like
importance, but in no event less than reasonable care.

 

10.2                           Exceptions.
 The receiving party shall have no
obligation or liability to the disclosing party with regard to any Confidential
Information of the disclosing party; (i) that was publicly known and
available at the time it was disclosed or becomes publicly known and available
through no fault, action, or inaction of the receiving party; (ii) was known
to the receiving party, without restriction, at the time of disclosure as shown
by the files of the receiving party in existence at the time of disclosure; (iii) is
disclosed with the prior written approval of the disclosing party; (iv) was
independently developed by the receiving party without any use of the
disclosing party’s Confidential Information, provided, that the receiving party
can demonstrate such independent development by documented evidence prepared
contemporaneously with such independent development; (v) is disclosed
pursuant to the order or requirement of a court, administrative agency, or
other governmental body, provided that the receiving party shall provide prompt
notice thereof and reasonable assistance to the disclosing party to enable the
disclosing party to seek a protective order or otherwise prevent such
disclosure, and provided further that such disclosure is limited to the extent
necessary to comply with such order and the information shall otherwise be
treated as Confidential Information; or (vi) that is provided to the
receiving party by an independent third party without violating any
confidentiality obligation to the disclosing party.

 

10.3                           Injunctive
Relief.  ACT and LICENSEE acknowledge
and agree that any breach of the confidentiality obligations imposed by this Section 10
will constitute immediate and irreparable harm to the disclosing party and/or
its successors and assigns, which cannot adequately and fully be compensated by
money damages and will warrant, in addition to all other rights and remedies
afforded by law, injunctive relief, specific performance, and/or other
equitable relief.  The disclosing party’s
rights and remedies hereunder are cumulative and not exclusive.  The disclosing party shall also be entitled to
receive from the receiving party the costs of enforcing this Article 10,
including reasonable attorneys’ fees and expenses of litigation.

 

10.4                           Termination.
 Upon termination or expiration of this
Agreement, or upon the request of the disclosing party at any time, the
receiving party shall promptly return to the disclosing party, at its request,
all copies of Confidential Information received from the disclosing party, and
shall return or destroy, and document the destruction of, all summaries,
abstracts, extracts, or other documents which contain any Confidential
Information of the disclosing party in any form.  Notwithstanding the foregoing to the contrary,
LICENSEE shall have no obligation (even upon a request by ACT) to return or
destroy any KNOW-HOW (including tangible embodiments of KNOW-HOW) during the
Term of this Agreement.

 

10.5                           Survival.
 The obligations of ACT and LICENSEE
under this Article 10 shall survive any expiration or termination of this
Agreement.

 

ARTICLE 11 - PAYMENTS, NOTICES, AND OTHER
COMMUNICATIONS

 

Any
payment, notice or other communication pursuant to this Agreement shall be in
writing and sent by certified first class mail, postage prepaid, return receipt
requested, or by nationally recognized overnight carrier addressed to the parties
at the following addresses or such other addresses

 

10

 

as such party furnishes
to the other party in accordance with this paragraph.  Such notices, payments, or other
communications shall be effective upon receipt.

 

In
the case of ACT:

 

Advanced
Cell Technology, Inc.

One
Innovation Drive

Worcester,
MA 01605

Attention:
Michael D. West, Ph.D., President

 

With
a copy to:

 

Pierce
Atwood

One
Monument Square

Portland,
ME 04101

Attention:
William L. Worden, Esq.

 

In
the case of LICENSEE:

 

One
Degree Genetics LLC

18
Plimpton Road

Westerly,
R.I. 02891

Attention:
Robert Saglio, President

 

With a copy to:                                     Goodwin
Procter LLP

Exchange
Place

53
State Street

Boston,
MA 02109

Attention:
Andrew F. Viles, P.C.

 

ARTICLE 12 - RESPRESENTATIONS AND WARRANTIES:
DISCLAIMER

 

12.1                           ACT
represents and warrants that it owns or has licensed with a sublicensable
interest the PATENT RIGHTS and KNOW-HOW, that it has the full legal right and
power to grant the licenses granted hereunder, that this Agreement constitutes
the binding legal obligation of ACT, enforceable in accordance with its terms
and that the execution and performance of this Agreement by ACT will not
violate, contravene or conflict with any other agreement to which ACT is a
party or by which it is bound or with any law, rule or regulation
applicable to ACT.

 

12.2                           LICENSEE
represents and warrants that it has full corporate power and authority to enter
into this Agreement, that this Agreement constitutes the binding legal obligation
of LICENSEE and that execution and performance of this Agreement by LICENSEE
will not violate, contravene or conflict with any other agreement to which
LICENSEE is a party or by which it is bound or with any law, rule or
regulation applicable to LICENSEE.

 

12.3                           EXCEPT
AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, ACT, ITS DIRECTORS,
OFFICERS, EMPLOYEES, AND AFFILIATES MAKE NO REPRESENTATIONS AND EXTEND NO
WARRANTIES OF ANY KIND, EITHER EXPRESS OR

 

11

 

IMPLIED, INCLUDING BUT
NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
VALIDITY OF PATENT RIGHTS, ISSUED OR PENDING, AND THE ABSENCE OF LATENT OR
OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE.  NOTHING IN THIS AGREEMENT SHALL BE CONSTRUED
AS A REPRESENTATION MADE OR WARRANTY GIVEN BY ACT THAT THE PRACTICE BY LICENSEE
OF THE LICENSE GRANTED HEREUNDER SHALL NOT INFRINGE THE PATENT RIGHTS OF ANY
THIRD PARTY.

 

ARTICLE 13 – LIMITATION OF LIABILITY

 

13.1                           EXCEPT
FOR ANY LIABILITY TO ANY THIRD PARTIES PURSUANT TO ARTICLE 8 OF THIS
AGREEMENT, IN NO EVENT SHALL ACT OR LICENSEE OR THEIR, ITS DIRECTORS, OFFICERS,
EMPLOYEES OR AFFILIATES BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF
ANY KIND, INCLUDING ECONOMIC DAMAGE OR INJURY TO PROPERTY AND LOST PROFITS,
REGARDLESS OF WHETHER ACT OR LICENSEE SHALL BE ADVISED, SHALL HAVE OTHER REASON
TO KNOW, OR IN FACT SHALL KNOW OF THE POSSIBILITY OF SUCH DAMAGES.

 

ARTICLE 14 - MISCELLANEOUS PROVISIONS

 

14.1                           LICENSEE
shall comply with all local, state, federal and international laws and
regulations relating to the development, manufacture, use, provision, and sale
of LICENSED PRODUCTS, LICENSED PROCESSES and LICENSED SERVICES.  Without limiting the generality of the
foregoing, LICENSEE agrees to comply with the following:

 

(a)                                  LICENSEE
shall obtain all necessary approvals from the FDA, USDA, or any similar
governmental authorities of any foreign jurisdiction in which LICENSEE intends
to make, use, or sell LICENSED PRODUCTS or to perform LICENSED PROCESSES or
LICENSED SERVICES.

 

(b)                                 LICENSEE
shall comply fully with any and all applicable local, state, federal and
international laws and regulations relating to the LICENSED PRODUCTS, LICENSED
PROCESSES and LICENSED SERVICES, and the PATENT RIGHTS, in the TERRITORY,
including without limitation all export or import regulations and rules now
in effect or as may be issued from time to time by any governmental authority
which has jurisdiction relating to the export of LICENSED PRODUCTS, LICENSED
PROCESSES or LICENSED SERVICES and any technology relating thereto.  LICENSEE hereby gives written assurance that
it will comply with all such import or export laws and regulations (including
without limitation all Export Administration Regulations of the United States
Department of Commerce), that it bears sole responsibility for any violation of
such laws and regulations, and that it will indemnify, defend, and hold ACT and
the University harmless (in accordance with Article 8) for the
consequences of any such violation.

 

(c)                                  To
the extent that any invention claimed in the PATENT RIGHTS has been partially
funded by the United States Government, and only to the extent required by
applicable laws and regulations, LICENSEE agrees that any LICENSED PRODUCTS
used or sold in the United States will be manufactured substantially in the
United States or its territories.  Current
law provides that if a domestic manufacturer is not commercially feasible under
the circumstances, ACT and/or the University may seek a waiver of this
requirement from the relevant federal agency on behalf of

 

12

 

LICENSEE and, upon
LICENSEE’S request, shall cooperate with LICENSEE in seeking such a waiver.

 

14.2                           LICENSEE
shall not create or incur or cause to be incurred or to exist any lien,
encumbrance, pledge, charge, restriction or other security interest of any kind
upon the PATENT RIGHTS.

 

14.3                           Neither
party shall originate any publicity, news release or other public announcement
(“Announcements”), written or oral, relating to this Agreement or the existence
of an arrangement between the parties, without the prior written approval of
the other party, which approval shall not be unreasonably withheld or delayed,
except as otherwise required by law.  Any
references to the University in such Announcements shall be subject to the
approval of the University.  The
foregoing notwithstanding, ACT and LICENSEE shall have the right to make such
Announcements without the consent of the other party or the University, as
applicable, in any prospectus, offering memorandum, or other document or filing
required by applicable securities laws or other applicable law or regulation,
provided that such party shall have given the other party or the University, as
applicable, at least ten (10) days prior written notice of the proposed
text for the purpose of giving the other party or the University, as
applicable, the opportunity to comment on such text.

 

14.4                           No
implied licenses are granted pursuant to the terms of this Agreement.  No licensed rights shall be created by
implication or estoppel.

 

14.5                           Nothing
herein shall be deemed to constitute either party as the agent or
representative of the party, or both parties as joint venturers or partners for
any purpose.  Each party shall be an
independent contractor, not an employee or partner of the other party, and the
manner in which each party renders its services under this Agreement shall be
within its sole discretion.  Neither
party shall be responsible for the acts or omissions of the other party, nor
shall either party have authority to speak for, represent or obligate the other
party in any way without prior written authority from the other party.

 

14.6                           To the
extent commercially feasible, and consistent with prevailing business practices
and applicable law, all LICENSED PRODUCTS sold pursuant to this Agreement will
be marked with the number of each issued patent that applies to such LICENSED
PRODUCTS.

 

14.7                           This
Agreement shall be construed, governed, interpreted and applied in accordance
with the laws of the Commonwealth of Massachusetts, U.S.A. without regard to
principles of conflicts of law thereof, except that questions affecting the
construction and effect of any patent shall be determined by the law of the
country in which the patent was granted.

 

14.8                           The
parties hereto acknowledge that this Agreement sets forth the entire Agreement
and understanding of the parties hereto as to the subject matter hereof, and
shall not be subject to any change or modification except by the execution of a
written instrument signed by the parties hereto.

 

14.9                           The
provisions of this Agreement are severable, and in the event that any provision
of this Agreement shall be determined to be invalid or unenforceable under any
controlling body of the law, such invalidity or unenforceability shall not in
any way affect the validity or enforceability of the remaining provisions
hereof.

 

13

 

14.10                     The failure
of either party to assert a right hereunder or to insist upon compliance with
any term or condition of this Agreement shall not constitute a waiver of that
right or excuse a similar subsequent failure to perform any such term or
condition by the other party.

 

14.11                     This
Agreement may not be assigned by LICENSEE without the prior written consent of
ACT, which consent shall be granted or denied in ACT’s sole discretion.  ACT may not assign this Agreement without the
consent of LICENSEE, which consent shall not be unreasonably withheld or
delayed, except that ACT may assign this Agreement to an affiliate or to a
successor in connection with the merger, consolidation, or sale of all or
substantially all of its assets or that portion of its business to which this
Agreement relates.  Notwithstanding the foregoing
to the contrary, this restriction on the assignment by LICENSEE of this
Agreement shall not prevent the assignment of this Agreement in connection with
a sale of all or substantially all of the assets of LICENSEE, so long as the
purchaser of the assets agrees to assume any and all outstanding liabilities to
LICENSOR under this Agreement, including but not limited to any outstanding
amounts under the promissory note referred to in paragraph 4.1.

 

14.12                     This
Agreement has been prepared jointly and no rule of strict construction
shall be applied against either party.  In
this Agreement, the singular shall include the plural and vice versa and the
word “including” shall be deemed to be followed by the phrase “without
limitation.”  The section headings contained
in this Agreement are inserted for convenience only and shall not affect in any
way the meaning or interpretation of this Agreement.

 

14.13                     This
Agreement may be executed in counterparts, each of which together shall
constitute one and the same Agreement.

 

14.14                     All rights
and licenses granted under or pursuant to this Agreement by ACT to LICENSEE
are, and shall otherwise be deemed to be, for purposes of Paragraph 365(n) of
the U.S. Bankruptcy Code (the “Code”), licenses to rights in “intellectual
property” as defined in the Code.  The
parties hereto agree that LICENSEE, as a licensee of such rights under this
Agreement, shall retain and may fully exercise all of its rights and elections
under the Code.  The parties hereto
further agree that, in the event of the commencement of a bankruptcy proceeding
by or against ACT including a proceeding under the Code, LICENSEE shall be
entitled to a complete duplicate of (or complete access to, as appropriate) any
such intellectual property and all embodiments of such intellectual property,
including the PATENT RIGHTS and KNOW-HOW, and the same, if not already in
LICENSEE’s possession, shall be promptly delivered to LICENSEE upon any such
commencement of a bankruptcy proceeding upon written request therefore by
LICENSEE.

 

IN
WITNESS WHEREOF, the parties have duly executed this Agreement on the EFFECTIVE
DATE.

 

	
  ADVANCED CELL
  TECHNOLOGY, INC.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Michael D. West

  	
   

  
	
  Printed Name:

  	
  Michael D. West, Ph.D.

  
	
  Title:

  	
  President &
  Chief Executive Officer

  
					

 

14

 

	
  ONE DEGREE GENETICS LLC

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Robert Saglio

  	
   

  
	
  Printed Name:

  	
  Robert Saglio

  
	
  Title:

  	
  President

  
					

 

15

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