/Docs/G/NVCA/2020/LifeScience-License-TermSheet/Form/0.md
| LawyersNote | = | I don't see that the "Effective Date" is defined or provided for, but it is used a lot. For demo purposes, could make the Effective Date the {ClosingDate.YMD}. |
| xlist | = |
|
| Ti | = | Term Sheet for University Life Science Startup License |
| Date.Ti | = | Date |
| CodersNote | = | This language of Date.sec is all mine, not the team. |
| Date.sec | = | The date of this Term Sheet is {EffectiveDate.YMD}. The "{_Effective_Date}" is the date on which the parties execute the definitive license agreement (the "{DefT.License_Agreement}") and close the financing round (the "Closing Date"), anticipated to be {ClosingDate.YMD}. |
| Date. | = | [G/Z/Base] |
| Licensor.Ti | = | {DefT.Licensor} |
| Licensor.sec | = | {Licensor.N,E,A} |
| Licensor. | = | [G/Z/Base] |
| Licensee.Ti | = | {DefT.Licensee} |
| Licensee.sec | = | {Company.US.N,E,A} and/or its {_Affiliate}(s). The term “{DefT.Licensee}” will only include {_Affiliate}(s) to the extent that the {_License} is assigned to such {_Affiliate} or an {_Affiliate} is granted a {_Sublicense}. |
| Licensee. | = | [G/Z/Base] |
| Territory.Ti | = | Territory |
| Territory.sec | = | “{DefT.Territory}” means worldwide. |
| Territory. | = | [G/Z/Base] |
| FieldOfUse.Ti | = | Field of Use |
| FieldOfUse.sec | = | [any and all uses [in humans]] |
| FieldOfUse. | = | [G/Z/Base] |
| Term.Ti | = | Term |
| Term.sec | = | The {_License_Agreement} will begin on the {_Effective_Date} and will expire upon expiration of the last remaining {_Royalty_Term}, unless earlier terminated in accordance with the termination provisions. On a {_Licensed_Product}-by-{_Licensed_Product} and country-by-country basis, upon expiration of the applicable {_Royalty_Term}, {_Licensee} will have a fully paid-up perpetual license to {_Licensed_Know-How} for such {_Licensed_Product} in such country (“country” shall also be deemed to refer to territories). |
| Term. | = | [G/Z/Base] |
| PatentRights.Ti | = | {DefT.Patent_Rights} |
| PatentRights.0.sec | = | means Licensor’s rights under the following: |
| PatentRights.1.sec | = | the patents and patent applications listed in Exhibit A; |
| PatentRights.2.sec | = | any non-provisional patent applications that claim priority to any provisional patent applications listed in Exhibit A; |
| PatentRights.3.sec | = | any foreign patent applications, foreign patents or related foreign patent documents that claim priority to a patent or patent application included in (a) or (b) above; |
| PatentRights.4.sec | = | any divisionals and continuations of patents or patent applications included in (a), (b), or (c) above (but not continuations-in-part, except as provided in (f) below); |
| PatentRights.5.sec | = | any patents, reissues, re-examinations, renewals, substitutions, and extensions issuing from the patent specification of any of the preceding; and |
| PatentRights.6.sec | = | any claims of continuation-in-part applications that claim priority to the U.S. patent applications listed in Exhibit A, but only to the extent such claims are directed specifically to subject matter described in at least one of the patents or patent applications identified in (a)-(e) above that meet the written description requirements of the first paragraph of 35 U.S.C. Section 112. |
| PatentRights.00.sec | = | {_Patent_Rights} do not include any inventions conceived (as determined under U.S. patent law) after the {_Effective_Date}, provided that to the extent a {_Patent_Right} is an {_Improvement}, such {_Improvement} will be added to Exhibit A by way of amendment. |
| PatentRights. | = | [G/Z/ol-a/s6] |
| LicenseToImprovements.Ti | = | License to Improvements |
| LawyersNote | = | It seems odd that the Principal Investigator is mentioned only at this late stage in the document. |
| LicenseToImprovements.1.sec | = | {_Licensor} shall disclose to {_Licensee} all {_Improvements} made in the laboratory of {PrincipalInvestigator.Name.Full} within [1-3] years of the {_Effective_Date} and disclosed to {_Licensor} by the [Principal Investigator]. |
| LicenseToImprovements.2.sec | = | Patentable {_Improvements} shall be added by amendment to the list of {_Patent_Rights} in Exhibit A of the {_License_Agreement} and {_Improvements} that are not patentable will be considered {_Licensed_Know-How} and shall be added to Exhibit B of the {_License_Agreement} [in both cases by mutual agreement of the parties] and shall be licensed on the same terms of the {_License}, with the option of minor additional economic terms (e.g., an upfront fee). |
| TeamsNote | = | (Note: add this language where an SRA is executed in conjunction with the {_License}:) |
| LicenseToImprovements.3.sec | = | In addition, any {_Improvements} that are developed under the SRA in the laboratory of {PrincipalInvestigator.Name.Full} shall be included in the {_License} as {_Patent_Rights}. |
| LicenseToImprovements.4.sec | = | “{DefT.Improvement}” means any invention, patentable or otherwise, conceived under the direction of the [Principal Investigator] where the invention is (a) not encumbered by any third party rights, (b) has been disclosed to Licensor’s technology licensing office, and (c) for patentable {_Improvements}, would necessarily infringe at least one {_Valid_Claim} in the Field of Use. |
| LicenseToImprovements. | = | [G/Z/paras/s4] |
| License.Ti | = | License |
| License.sec | = | {_Licensor} grants to {_Licensee} an exclusive license to the {_Patent_Rights}, and a non-exclusive license to use {_Licensed_Know-How}, to research, discover, develop, manufacture/make, have made, use, market, sell, offer to sell, have sold, import, export, distribute, rent, license to end-users or lease {_Licensed_Products} in the Field of Use and the {_Territory}. |
| License. | = | [G/Z/Base] |
| Sublicensing.Ti | = | Sublicensing Rights / Requirements |
| Sublicensing.1.sec | = | The {_License_Agreement} shall include the right to grant {_Sublicenses} through multiple tiers of {_Sublicensees}. Within 30 days after execution of each {_Sublicense}, {_Licensee} will furnish {_Licensor} a complete copy of the {_Sublicense} and any amendments to the {_Sublicense}; provided, however, that {_Licensee} has the right to redact any portion of the {_Sublicense} that does not relate to the {_Licensed_Products}, {_Patent_Rights} or {_Licensed_Know-How}. {_Licensee} will not be required to provide Subcontracts to {_Licensor}. |
| Sublicensing.2.sec | = | {_Licensee} will require that all {_Sublicenses} be consistent with the terms and conditions of the {_License_Agreement}, including e.g., the following duties: to keep records; to properly mark {_Licensed_Products} with patent numbers; to defend, hold harmless, and indemnify {_Licensor}; to maintain insurance; to restrict the use of Licensor’s name and to control exports. Sublicensing is permitted provided that {_Licensee} has exclusive {_Patent_Rights} under the {_License_Agreement}, {_Licensed_Know-How} is only being {_Sublicense}d in connection with Licensed {_Patent_Rights}, and that {_Licensee} is not in material breach of the {_License_Agreement}. |
| Sublicensing. | = | [G/Z/paras/s2] |
| SurvivalOfSublicenses.Ti | = | Survival of {_Sublicenses} |
| SurvivalOfSublicenses.1.sec | = | If the {_License_Agreement} terminates for any reason, {_Licensor} will provide to each {_Sublicensee} the right to enter into a license of the {_Licensed_Technology} in the applicable {_Sublicense} directly with {_Licensor}, under the same terms and conditions as the {_License_Agreement} (as reasonably applied to such {_Licensed_Technology}); provided that (a) {_Licensor} and {_Sublicensee} will discuss in good faith any appropriate modifications to such terms and conditions and (b) {_Licensor} is not obligated to enter into a license agreement having a scope of {_Licensed_Technology}, Field of Use, {_Territory}, or other obligation on the part of {_Licensor} that would exceed those in the applicable {_Sublicense}. |
| SurvivalOfSublicenses.2.sec | = | Licensor’s obligation above will apply only if (a) {_Licensor} is legally, contractually, and per its policies permitted to enter into such license at the time; (b) {_Sublicensee} provides written notice to both {_Licensor} and {_Licensee} within 90 days after such termination of its desire for such discussions, and {_Licensee} does not dispute the termination; (c) {_Sublicensee} is not an {_Affiliate} of {_Licensee}; and (d) {_Sublicensee} is not in material breach of the {_Sublicense} [in the two year period prior to the {_License_Agreement} termination]. The {_Sublicense} shall not be terminated during the 90 day notice period and the negotiation period between {_Licensor} and {_Sublicensee}. |
| SurvivalOfSublicenses. | = | [G/Z/paras/s2] |
| Subcontracts.Ti | = | Subcontracts |
| Subcontracts.sec | = | {_Licensee} may engage a subcontractor to perform, on behalf of {_Licensee}, research, development, and manufacturing services under the {_License}, provided that (i) any subcontract will not relieve {_Licensee} from any of its obligations under the {_License}; (ii) any act or omission by a subcontractor shall be deemed an act or omission of {_Licensee}; (iii) any subcontract provides for the automatic assignment to {_Licensee} of any and all intellectual property generated by the subcontractor, its employees, and consultants in the course of performing the subcontracted services to {_Licensee} (other than with respect to intellectual property generated that relates to such subcontractor’s platform or background intellectual property, ownership of which may remain with such subcontractor); and (iv) {_Licensee} shall be responsible for each of its subcontractors complying with all applicable obligations of {_Licensee} under the {_License}. A subcontractor that {_Licensee} has engaged through an agreement complying with the terms above shall not be deemed to be a {_Sublicensee} under the {_License}, regardless of whether such subcontract includes a grant of a sublicense under any {_Patent_Rights} or {_Licensed_Know-How}. |
| Subcontracts. | = | [G/Z/Base] |
| LicenseIssueFee.Ti | = | License Issue Fee |
| LicenseIssueFee.sec | = | {_Licensee} shall pay an up-front fee of $___ within [x] days of the {_Effective_Date}. |
| LicenseIssueFee. | = | [G/Z/Base] |
| Equity.Ti | = | Equity |
| Equity.0.sec | = | {_Licensee} shall issue to {_Licensor} shares of its common stock representing [x]% on a Fully Diluted Basis [[at the {_Effective_Date}] or [at the closing of Licensee’s next round of equity financing]]. |
| Equity.1.sec | = | “{DefT.Fully-Diluted_Basis}” means the total number of shares of Licensee’s issued and outstanding common stock, assuming (a) the conversion of all issued and outstanding securities convertible into common stock; (b) the exercise of all issued and outstanding warrants or options, regardless of whether then exercisable; and (c) the issuance, grant, and exercise of all securities reserved for issuance pursuant to any {_Licensee} stock or stock option plan then in effect. |
| Equity.2.sec | = | Anti-Dilution: {_Licensee} will issue {_Licensor}, without further consideration, additional shares of common stock as is necessary to ensure that the number of shares issued to {_Licensor} do not represent less than x% of the shares issued and outstanding on a {_Fully-Diluted_Basis}. This anti-dilution protection will continue until an amount of at least $X,000,000, when aggregated with prior closings, has been raised by {_Licensee} in bona fide financings through the sale of securities or by conversion of instruments convertible into equity (“{DefT.Dilution_Cap}”). If the {_Dilution_Cap} is reached or exceeded during a specific round of funding, anti-dilution protection [will] [will not] extend to the total amount of funding raised through the closing of that specific round of funding. |
| Equity.3.sec | = | Preemptive Rights: If {_Licensee} proposes to sell any equity securities or securities that are convertible into equity securities, {_Licensor} and/or its {_Assignee} may purchase up to [[their pro rata] or [x%]] of the securities issued in each financing on the same terms and conditions as are offered to the other purchasers in each such financing. {_Licensee} will provide [x] days advance written notice of each such financing, including reasonable detail regarding the terms and purchasers in the financing. |
| Equity.4.sec | = | “{DefT.Assignee}” means (a) [insert name of entity to which Licensor’s preemptive rights may be assigned] or (b) any entity that is controlled by {_Licensor}. |
| Equity. | = | [G/Z/paras/s4] |
| DevelopmentMilestonePayments.Ti | = | Development Milestone Payments |
| DevelopmentMilestonePayments.Intro.sec | = | Each of the following payments (each a “{DefT.Development_Milestone_Payment}”) will be due upon achieving the indicated milestone (each such milestone, a “{DefT.Development_Milestone}” for [each {_Licensed_Product}] [the first {_Licensed_Product}] [the first [2][3] {_Licensed_Products}]. {_Licensee} shall make each such payment irrespective of whether the associated {_Development_Milestone} was reached by {_Licensee} itself, by a {_Sublicensee} and/or by a third party acting on behalf of {_Licensee} or a {_Sublicensee}. |
| [Examples of typical {_Development_Milestones}] : | = | |
| DevelopmentMilestonePayment.1.sec | = | [First/third/fifth] subject dosed in Phase [1/2/3] clinical trial: [$____] |
| DevelopmentMilestonePayment.2.sec | = | Submission of the first IND for a {_Licensed_Product}: [$____] |
| DevelopmentMilestonePayment.3.sec | = | FDA approval of a {_Licensed_Product}: [$____] |
| DevelopmentMilestonePayment.4.sec | = | {_First_Commercial_Sale} of a {_Licensed_Product}: [$____] |
| DevelopmentMilestonePayment. | = | [G/Z/ol-II/s4] |
| DevelopmentMilestonePayments. | = | [G/Z/Base] |
| DevelopmentMilestonePayments.sec | = | {DevelopmentMilestonePayments.Intro.sec} {DevelopmentMilestonePayment.sec} |
| RoyaltyRate.Ti | = | Royalty Rate |
| ProofersNote | = | "regulatory exclusivity" is defined, but here is used in lower case. |
| RoyaltyRate.1.sec | = | For {_Patent_Products}, {_Licensee} shall pay {_Licensor} x% of Net Sales, with [50]% reduction for {_Patent_Products} that are no longer Covered by a {_Valid_Claim} [and are no longer under regulatory exclusivity], but are Covered by {_Licensed_Know-How}. |
| RoyaltyRate.2.sec | = | For {_Know-How_Products}, {_Licensee} shall pay {_Licensor} [½]x% of Net Sales. |
| RoyaltyRate. | = | [G/Z/paras/s2] |
| NetSales.Ti | = | Net Sales |
| ProofersNote | = | "Third Party Distributors" is used in initial caps as if it were a defined term. If it is, it should be defined in the Definitions section. If not to be defined, it should be used in lower case. |
| NetSales.1.0.sec | = | means, with respect to a {_Licensed_Product}, for any period, the total amount billed or invoiced on sales of such {_Licensed_Product} during such period by the {_Selling_Party} in the {_Territory} to third parties (including third party wholesalers and Third Party Distributors), in bona fide arm’s length transactions, less the following documented deductions , and in each case related specifically (or reasonably allocated by such {_Selling_Party} in accordance with its standard policies and procedures consistently applied across its products) to the {_Licensed_Product}, and not otherwise recovered by or reimbursed to the {_Selling_Party}: |
| NetSales.1.1.sec | = | trade, cash and quantity discounts, charge-back payments, and rebates actually granted to trade customers, managed health care organizations, pharmaceutical benefit managers, group purchasing organizations, and national, state, or local governments; |
| = | ||
| NetSales.1.2.sec | = | credits, rebates, or allowances actually allowed upon prompt payment or on account of claims, damaged goods, rejections, or returns of such {_Licensed_Product}, including in connection with recalls and retroactive price reductions; |
| = | ||
| NetSales.1.3.sec | = | taxes to the extent included in the gross amount invoiced (excluding income or franchise taxes of any kind), duties, tariffs, mandated contribution, or other governmental charges levied on the sale of such {_Licensed_Product}, including VAT (net of reimbursement of any value added taxes actually received), excise taxes and sales taxes, that the {_Selling_Party} allocates to sales of such {_Licensed_Product} in accordance with its standard policies and procedures consistently applied across its products, as applicable; |
| NetSales.1.4.sec | = | the portion of administrative fees paid during the relevant time period to group purchasing organizations, pharmaceutical benefit managers or Medicare Prescription Drug Plans relating to such {_Licensed_Product}; |
| = | ||
| NetSales.1.5.sec | = | any invoiced amounts from a prior period which are not collected and are written off by the {_Selling_Party}, including bad debts (provided that if the debt is thereafter paid, the corresponding amount shall be added to the Net Sales for the period during which it is paid); |
| = | ||
| NetSales.1.6.sec | = | that portion of the annual fee on prescription drug manufacturers imposed by the Patient Protection and Affordable Care Act, Pub. L. No. 111-148 (as amended) to the extent (a) reasonably allocable to sales of such {_Licensed_Product} and (b) the {_Selling_Party} actually includes such fee as a deduction from gross revenue in its publicly filed financial reports; |
| = | ||
| NetSales.1.7.sec | = | packaging, freight, postage, shipping, transportation, warehousing, handling, export/import and insurance charges, in each case, actually allowed or paid for delivery of such {_Licensed_Product}, and any customary payments with respect to such {_Licensed_Product} actually made to wholesalers or other {_Distributors}, in each case, actually allowed or paid for distribution and delivery of such {_Licensed_Product}, to the extent billed on actual invoices; |
| = | ||
| NetSales.1.8.sec | = | any sales, credits, or allowances given or made with respect to such {_Licensed_Product} for wastage replacement; and |
| NetSales.1.9.sec | = | any other similar and customary deductions that are consistent with GAAP as consistently applied by {_Selling_Party} to all of its products, but which may not be duplicative of the above deductions. |
| NetSales.1. | = | [G/Z/ol-a/s9] |
| NetSales.2.0.sec | = | For {_Combination_Products}, Net Sales will be calculated as follows: |
| NetSales.2.1.sec | = | If the {_Licensed_Product} and all {_Other_Components} of the {_Combination_Product} were sold separately during the same or immediately preceding calendar quarter, the proration factor will be determined by the formula [A / (A+B)], where A is the weighted average invoice price of all {_Licensed_Product} components during such period when sold separately from the {_Other_Component}(s), and B is the weighted average gross invoice price of the {_Other_Components} during such period when sold separately from the {_Licensed_Product} (as applicable); |
| = | ||
| NetSales.2.2.sec | = | If the {_Licensed_Product} components containing only the {_Licensed_Compound} as its Active Ingredient are sold separately from the {_Other_Components}, but the {_Other_Components} in such {_Combination_Product} are not sold separately, then the proration factor will be determined by the formula [A / C], where A is the average gross sales price of all {_Licensed_Product} components containing only the {_Licensed_Compound} as its Active Ingredient during such period when sold separately from the {_Other_Components}, and C is the average gross sales price of the {_Combination_Product} during such period; |
| = | ||
| NetSales.2.3.sec | = | If the {_Licensed_Product} components containing only the {_Licensed_Compound} as its Active Ingredient are not sold separately from the {_Other_Components}, but the {_Other_Components} in such {_Combination_Product} are sold separately, then the proration factor will be determined by the formula [(C- B) / C], where B is the average gross sales price of the {_Other_Components} included in such {_Combination_Product} if sold separately from the {_Other_Component}(s), and C is the average gross sales price of the {_Combination_Product} during such period; or |
| NetSales.2.4.sec | = | If neither the {_Licensed_Compound} nor the {_Other_Components} included in the {_Combination_Product} were sold or provided separately during the relevant period, then the proration factor will be mutually agreed upon by the parties in good faith based on the relative value contributed by each component and, to the extent the parties are unable to establish such proration factor, then such proration factor will be established by Standard Dispute Resolution. |
| NetSales.2.5.sec | = | In the event that such separate sales were not made or performed during the immediately preceding calendar year (“{DefT.CY}”), then the invoiced amounts for the {_Combination_Product} for purposes of calculating Net Sales will be multiplied by the fraction C/(C + D), where C is the average fully burdened cost of manufacture of the {_Licensed_Products} during the immediately preceding {_CY} and D is the average fully burdened cost of manufacture of the additional items during the immediately preceding {_CY}, in each case calculated in accordance with GAAP. |
| NetSales.2. | = | [G/Z/ol-a/s5] |
| NetSales.3.sec | = | Any allocation of revenue from the sale or other disposition of {_Combination_Products}, or any allocation of the costs of manufacture, shall be done in good faith, and will take into consideration revenue recognition guidance under GAAP which is applicable to multiple-deliverable revenue arrangements. |
| NetSales.4.sec | = | All allocations of discounts, allowance, credits, rebates and other deductions must be reasonable. Any amounts received or invoiced by a {_Selling_Party} will be accounted for only once. For purposes of determining Net Sales, a {_Licensed_Product} will be deemed to be sold when recorded as a sale by {_Selling_Party} in accordance with GAAP. |
| NetSales.5.sec | = | Amounts received or invoiced by {_Licensee} or a {_Sublicensee} for the sale of a {_Licensed_Product} among {_Licensee} or a {_Sublicensee} will not be included in the computation of Net Sales, unless the purchasing entity is the end-user of such {_Licensed_Product}. |
| NetSales.6.sec | = | Net Sales will exclude any {_Licensed_Product} transferred or disposed of as samples or for clinical trials or at or below costs of goods therefor for any so-called treatment investigational new drug sales, named patient sales, expanded access program, compassionate or emergency use sales or pre-license sales made for non-commercial, compassionate purpose, or any indigent program or promotional or educational purposes; in each case with respect to such {_Licensed_Product} and are reported on the royalty report for such period when such {_Licensed_Products} are so transferred or disposed of. |
| NetSales.7.sec | = | Net Sales will be calculated in accordance with the standard internal policies and procedures of the {_Selling_Party}. |
| NetSales.8.sec | = | For purposes of calculating Net Sales, all Net Sales shall be converted into U.S. dollars. |
| NetSales. | = | [G/Z/paras/s8] |
| RoyaltyTerm.Ti | = | “{DefT.Royalty_Term}” |
| RoyaltyTerm.sec | = | means, on a {_Licensed_Product}-by-{_Licensed_Product} and country-by-country basis, the royalty term will commence on the {_First_Commercial_Sale} of a {_Licensed_Product} in any country and continue until the latest of (a) the date on which such {_Licensed_Product} is no longer Covered by a {_Valid_Claim} in the country in which the manufacture or sale occurs; (b) the expiration of {_Regulatory_Exclusivity} for such {_Licensed_Product} in the country in which the sale occurs; and (c) the [x] year anniversary of the {_First_Commercial_Sale} of such {_Licensed_Product} in the country in which the sale occurs. |
| RoyaltyTerm. | = | [G/Z/Base] |
| MinimumAnnualRoyalty.Ti | = | Minimum Annual Royalty |
| MinimumAnnualRoyalty.0.sec | = | {_Licensee} shall pay {_Licensor} Minimum Annual Royalties as set forth below. Earned royalties paid during a given {_CY} may be used as credit against the Minimum Annual Royalty due for that same {_CY}, but cannot be used as credit against a Minimum Annual Royalty obligation owed for any other {_CY}. |
| MinimumAnnualRoyalty.1.sec | = | First full {_CY}] after {_Effective_Date}: {MAR.1.$} |
| MinimumAnnualRoyalty.2.sec | = | Second through fourth full {_CYs} after {_Effective_Date}: {MAR.2.$} |
| MinimumAnnualRoyalty.3.sec | = | Fifth full {_CY} after {_Effective_Date} and each {_CY} thereafter until {_First_Commercial_Sale}: {MAR.3.$} |
| MinimumAnnualRoyalty.4.sec | = | First {_CY} after {_First_Commercial_Sale} and each {_CY} thereafter: {MAR.4.$} |
| MinimumAnnualRoyalty. | = | [G/Z/ol-bullet/s4] |
| RoyaltyStacking.Ti | = | Royalty Stacking |
| RoyaltyStacking.sec | = | {_Licensee} will be entitled to deduct, from the cumulative royalties otherwise due {_Licensor} in respect of Net Sales of {_Licensed_Products}, [X%] of all such royalties paid or payable by {_Selling_Party}(ies) to one or more third parties in respect of such {_Licensed_Products} if, in the absence of a license, sublicense, acquisition or access to a third party’s intellectual property rights, the researching, discovering, developing, manufacturing/making, having made, using, marketing, selling, offering to sell, having sold, importing, exporting, distributing, renting, licensing to end-users or leasing of a {_Licensed_Product} would or is likely to infringe or misappropriate such intellectual property rights. In no event will such deduction reduce any royalty payments to be made by {_Licensee} by more than [X%] for any calendar quarter; and provided, further, that any reduction, or portion thereof, may be carried forward for use in a future calendar quarter. With respect to any third party exclusive licensors, the foregoing royalty stacking provisions will only apply in the event such third party exclusive licensors receiving royalties of [x]%] are also subject to similar royalty stacking provisions. |
| RoyaltyStacking. | = | [G/Z/Base] |
| SublicensingConsideration.Ti | = | Sublicensing Consideration |
| SublicensingConsideration.1.0.sec | = | {_Licensee} shall pay to {_Licensor} a portion of all {_Sublicensing_Income} as follows: |
| SublicensingConsideration.1.1.sec | = | W% of {_Sublicensing_Income} received as the result of any {_Sublicense} entered into prior to [event or date X]; |
| SublicensingConsideration.1.2.sec | = | X% of {_Sublicensing_Income} received as the result of any {_Sublicense} entered into after [event or date X] but before [event or date Y]; |
| SublicensingConsideration.1.3.sec | = | Y% of {_Sublicensing_Income} received as the result of any {_Sublicense} entered into after [event or date Y] but prior to [event or date Z]; and |
| SublicensingConsideration.1.4.sec | = | Z% of {_Sublicensing_Income} received as the result of any {_Sublicense} entered thereafter. |
| SublicensingConsideration.1. | = | [G/Z/ol-bullet/s4] |
| SublicensingConsideration.2.sec | = | {_Licensee} may apportion a commercially reasonable percentage of {_Sublicensing_Income} between the {_Patent_Rights} and patent rights owned or controlled by {_Licensee} and that are included in the same {_Sublicense}, provided that (a) {_Licensee} provides {_Licensor} with reasonably detailed information on the apportionment and justification no later than 60 days prior to the due date for amounts due and (b) {_Licensee} and {_Licensor} agree on the apportionment. If {_Licensee} and {_Licensor} cannot agree on the apportionment, the parties shall use Standard Dispute Resolution. |
| SublicensingConsideration. | = | [G/Z/paras/s2] |
| DiligenceMilestones.Ti | = | Diligence Milestones |
| CodersNote | = | Note the (fine?!) distinction between DiligenceMilestones for the section and DiligenceMilestone (singular) for the list items. |
| DiligenceMilestones.UseEffortToCommercialize.sec | = | {_Licensee} shall use {_Commercially_Reasonable_Efforts} to develop at least one {_Licensed_Product} in the {_Territory} and commercialize such {_Licensed_Product} following regulatory approval. |
| DiligenceMilestone.0.sec | = | In addition, {_Licensee} (either itself or through the acts of a {_Sublicensee}) is required to achieve the following due diligence milestones (the “{DefT.Diligence_Milestone}”) by the dates set forth below (the “{DefT.Achievement_Date}”): |
| [Examples of {_Diligence_Milestones}:] | = | |
| DiligenceMilestone.1.sec | = | Obtaining financing in an amount of at least [$] by [DATE] |
| DiligenceMilestone.2.sec | = | Nomination of a development candidate by [DATE] |
| DiligenceMilestone.3.sec | = | Initiation of GLP toxicity studies by [DATE] |
| DiligenceMilestone.4.sec | = | Submission of the first IND for a {_Licensed_Product} by [DATE] |
| DiligenceMilestone.5.sec | = | First subject dosed in Phase 1 clinical trial by [DATE] |
| DiligenceMilestone. | = | [G/Z/ol-II/s5] |
| DiligenceMilestones.sec | = | {DiligenceMilestones.UseEffortToCommercialize.sec} {DiligenceMilestone.sec} |
| DiligenceMilestones. | = | [G/Z/Base] |
| DeferralOfDiligenceMilestones.Ti | = | Deferral of {_Diligence_Milestones} |
| ProofersNote | = | "Extension Fee" is defined but not otherwise used. |
| DeferralOfDiligenceMilestones.sec | = | {_Licensor} acknowledges that due to long development times, scientific, potential safety and development hurdles and challenges and regulatory requirements and processes associated with Licensee’s industry, {_Licensee} may be unable to achieve a particular {_Diligence_Milestone} by a relevant {_Achievement_Date}. {_Licensee} will notify {_Licensor} in writing in advance of any such anticipated delay, and as long as {_Licensee} is fulfilling its obligations of {_Commercially_Reasonable_Efforts}, the parties will negotiate in good faith an extension of the relevant {_Achievement_Date} upon the payment of a fee (the “{DefT.Extension_Fee}”) equal to [$x/x% of the relevant {_Development_Milestone_Payment}], which extension {_Licensee} must exercise no later than [x days] before the relevant {_Achievement_Date}. [{_Licensee} may extend each {_Diligence_Milestone} as set forth above only [once/twice]]. |
| DeferralOfDiligenceMilestones. | = | [G/Z/Base] |
| PatentProsecution.Ti | = | Patent Prosecution |
| PatentProsecution.1.sec | = | {_Licensor} will have the right to control the preparation, filing, prosecution and maintenance of the {_Patent_Rights}, reexaminations, interferences, oppositions, and any other ex parte or inter partes matters (e.g., inter partes reviews) originating or conducted in a patent office (“{DefT.Patent_Actions}”), using outside counsel reasonably satisfactory to {_Licensee}. {_Licensor} will (a) instruct Licensor’s patent counsel to furnish to {_Licensee} copies of material documents relevant to such Patent Actions before any deadlines; (b) allow {_Licensee} a reasonable opportunity to comment on material documents filed with respect to such Patent Actions; and (c) take into reasonable consideration such comments from {_Licensee}. {_Licensee} will, to the fullest extent permitted by law, apply for and prosecute, or support in any reasonable way Licensor’s application for, any reasonable patent term extension for patents included in the {_Patent_Rights}. |
| PatentProsecution.2.sec | = | So long as {_Licensee} reimburses {_Licensor} for {_Patent_Costs}, {_Licensor} will continue to prosecute and maintain the {_Patent_Rights} in the countries selected by {_Licensee}. |
| PatentProsecution.3.sec | = | Subject to the terms of this section, with the consent of {_Licensor} (such consent not to be unreasonably withheld), {_Licensee} has the right, on a country-by-country basis, to elect to not reimburse {_Licensor} for {_Patent_Costs} related to a particular Patent Action. If {_Licensee} makes such an election, {_Licensee} will provide reasonable advance notice to {_Licensor} in writing, such notice to be at least 90 days prior to any such Patent Action. Upon such notice, such patent application(s) and patent(s) thereafter are and will be excluded from the definition of {_Patent_Rights} without further notice. Under such circumstances, {_Licensor} may elect to abandon or continue the prosecution and/or maintenance of such application(s) or patent(s) at its sole or subsequent partner’s expense. If {_Licensee} fails to provide such notice and {_Licensor} incurs {_Patent_Costs} in respect of such Patent Action, then {_Licensee} shall be responsible for such {_Patent_Costs}. |
| PatentProsecution. | = | [G/Z/paras/s3] |
| PatentExpenseReimbursement.Ti | = | Patent Expense Reimbursement |
| PatentExpenseReimbursement.sec | = | {_Licensee} will bear all out-of-pocket costs incurred by {_Licensor} for Patent Actions (“{DefT.Patent_Costs}”). {_Licensee} will reimburse {_Licensor} [within 30 days after Licensee’s receipt of an invoice from {_Licensor}] for {_Patent_Costs} incurred by {_Licensor} before the {_Effective_Date} and during the term of the {_License_Agreement}. Alternatively, if {_Licensor} requests, {_Licensee} will pay ongoing {_Patent_Costs} in advance or under a reasonable direct billing arrangement with Licensor’s patent counsel. {_Licensor} will provide {_Licensee} with documentation of the {_Patent_Costs}. |
| PatentExpenseReimbursement. | = | [G/Z/Base] |
| DisclaimWarranty.Ti | = | Disclaimer of Warranties and Limitation of Liabilities |
| DisclaimWarranty.1.sec | = | {_Licensed_Technology} is provided by {_Licensor} without warranty of merchantability or fitness for a particular purpose or any other warranty of any kind, express or implied. {_Licensor} makes no express or implied representation or warranty that use or commercialization of the patent rights or {_Licensed_Products} or non-patent technology will not infringe any patent, copyright, trademark or other rights. |
| DisclaimWarranty.2.sec | = | Except as otherwise provided in the {_License_Agreement}, the {_License_Agreement} does not imply (a) a warranty or representation as to the validity, enforceability, or scope of any {_Patent_Rights}; (b) by implication, estoppel or otherwise, any grant of any license under any patents other than the {_Patent_Rights} or under any other rights other than the {_Licensed_Know-How} of {_Licensor}, regardless of whether such patents or other rights are dominant or subordinate to {_Patent_Rights}. |
| DisclaimWarranty.3.sec | = | In no event will either party be responsible or liable for any indirect, special, incidental, or consequential damages or lost profits or other economic loss or damage regardless of legal or equitable theory. The above limitations on liability apply even if the other party may have been advised of the possibility of such damage. |
| DisclaimWarranty. | = | [G/Z/paras/s3] |
| NVCA-Note | = | These (Insure and Indemn) provisions are not included in the Term Sheet because each Licensor will be subject to the policies of its Office of General Counsel on these matters, and hence there are no “standard” terms. |
| Indemn-Insure.Ti | = | Indemnification and Insurance |
| Indemn-Insure. | = | [G/Z/Base] |
| PatentChallenges.Ti | = | {_Patent_Challenges} |
| PatentChallenges.0.sec | = | {_Licensee} will provide written notice to {_Licensor} at least 90 days before {_Licensee}, or {_Sublicensee} initiates or participates directly or indirectly in a {_Patent_Challenge}. {_Licensee} or such {_Sublicensee} will identify all prior art and other evidence material to the {_Patent_Challenge} in such written notice. If {_Licensee} or a {_Sublicensee} participates directly or indirectly in a {_Patent_Challenge}, the following applies: |
| PatentChallenges.1.Alt1.sec | = | {_Licensor} has the right to terminate the {_License_Agreement} at any time (including after the termination of such {_Patent_Challenge}) upon written notice delivered to {_Licensee}, and the {_License_Agreement} cure provisions for non-monetary breach will not apply; provided that if a {_Patent_Challenge} is initiated by a {_Sublicensee}, {_Licensor} will only be permitted to terminate the {_License_Agreement} if, within 30 days following receipt of notice that {_Sublicensee} has initiated a {_Patent_Challenge}, {_Licensee} has failed to terminate the {_Sublicense} or {_Sublicensee} has not vacated the {_Patent_Challenge}. |
| OR | = | |
| PatentChallenges.1.Alt2.sec | = | {_Licensor} will meet with {_Licensee} and any designee of {_Licensee} within three months after such notice from {_Licensee} and at least semi-annually at the request of {_Licensee}, in a good faith effort to resolve any {_Patent_Challenge}; |
| PatentChallenges.1. | = | [G/Z/Alt/2] |
| PatentChallenges.1.SecName | = | {SecName}PatentChallenges.1. |
| PatentChallenges.2.sec | = | during the pendency of such action or proceeding (including any appeals), the applicable royalty rate(s) will increase to double the applicable royalty rate(s); |
| PatentChallenges.3.sec | = | should the outcome of such action or proceeding determine that any such claim challenged by {_Licensee} or a {_Sublicensee} is valid, enforceable, and/or infringed by a Licensed Product, the royalty rate(s) will increase to triple the applicable royalty rate(s); |
| PatentChallenges.4.sec | = | {_Licensee} and any {_Sublicensee}(s) will have no right to recoup any royalties paid before such action or proceeding or during the period in which such action or proceeding is pending (including on appeal), no matter the outcome of such action or proceeding; and |
| PatentChallenges.5.sec | = | {_Licensee} shall pay all reasonable costs and expenses incurred by {_Licensor} (including, but not limited to, Licensor’s actual attorneys’ fees) in connection with such action or proceeding. {_Licensor} may bill {_Licensee} as frequently as monthly concerning such costs and expenses, and {_Licensee} shall make payment no later than 30 days after receiving an invoice from {_Licensor}. Notwithstanding any other provision of the Agreement, with respect to any such {_Patent_Challenge}, {_Licensor} will have full control and authority to defend the {_Patent_Rights} in the action or proceeding and will not be required to share any work product concerning such action or proceeding with {_Licensee} or the {_Sublicensee}(s). |
| PatentChallenges. | = | [G/Z/ol-a/s5] |
| 3PartyClaim.Ti | = | Third Party Claim |
| 3PartyClaim.sec | = | In the event of a third-party challenge (including inter partes reviews and declaratory judgements) to any of the {_Licensed_Technology}, {_Licensor} will have the first right to assume and control the defense of the claim at Licensor’s expense. If {_Licensor} fails to assume such defense within 60 days of becoming aware of such challenge, {_Licensee} may assume and control such defense at Licensee’s expense. The party controlling the defense may join the other party in any such action if a court of competent jurisdiction determines the other party is an indispensable party to such proceeding and the controlling party shall pay the expenses of the joined party. The party controlling the defense of such legal action will keep the other party reasonably informed of the proceedings and will not settle such action without the prior written consent of the other party, such consent not to be unreasonably withheld. |
| 3PartyClaim. | = | [G/Z/Base] |
| PatentEnfocement.Ti | = | Patent Enforcement |
| PatentEnfocement.sec | = | In the event that either party believes that a third party is infringing or misappropriating any of the {_Licensed_Technology}, [Licensee/Licensor] will have the first right to enforce the claim at {PatentEnforcement.Initiator.Licensee/Licensor}’s expense. If {PatentEnforcement.Initiator.Licensee/Licensor} fails to initiate such action within 90 days of becoming aware of such infringement or misappropriation, the other party may assume and control such action at the other party’s expense. The party controlling the action may require the other party to join in any such action if a court of competent jurisdiction determines the other party is an indispensable party to such proceeding and the controlling party will pay the expenses of the joined party. The party controlling such legal action will keep the other party reasonably informed of the proceedings and will not settle such action without the prior written consent of the other party, such consent not to be unreasonably withheld. |
| PatentEnfocement. | = | [G/Z/Base] |
| AwardSharing.Ti | = | Award Sharing |
| AwardSharing.sec | = | Any recovery, whether by way of settlement or judgment, from a third party pursuant to a legal proceeding shall first be used to reimburse the initiating party and the non-initiating party for their actual fees, costs and expenses incurred in connection with such proceeding. The initiating party shall divide any remaining amounts from any such settlement or judgment as follows: (i) any recovery reflecting lost profits damages and/or reasonable royalty damages, {_Licensee} retains or receives such recovery, and {_Licensor} retains or receives the amount of royalties due to {_Licensor} had those activities been performed by {_Licensee}, and (ii) all other remaining amounts (including any punitive or exemplary damages) are divided [75%] to the party who initiated or carried on the proceedings and [25%] to the other party. |
| AwardSharing. | = | [G/Z/Base] |
| UnmetNeeds.Ti | = | Unmet Needs |
| UnmetNeeds.sec | = | {_Licensor} would like {_Licensee} to address unmet needs, such as those of neglected patient populations or geographic areas, giving particular attention to improved therapeutics, diagnostics and agricultural technologies for low and middle income countries. If (a) {_Licensee} is unable or unwilling to serve an unmet need for which there is an adequately-resourced company willing to be a {_Sublicensee}, and (b) such potential {_Sublicensee} has provided {_Licensee} with a bona fide, detailed proposal to serve such unmet needs (which {_Licensee} will provide to {_Licensor}), then, unless {_Licensee} can demonstrate to Licensor’s reasonable satisfaction that {_Licensee} will serve such unmet need itself or through another third party, {_Licensee} will, at Licensor’s request, negotiate in good faith a {_Sublicense} with said potential {_Sublicensee} on reasonable commercial terms. If the {_Sublicense} is not executed within [12] months, then {_Licensor} has the right to grant a license to serve such unmet need exclusively or non-exclusively, on reasonable commercial terms that, in the judgement of {_Licensee}, will not impair its business, and {_Licensor} will notify {_Licensee} of such a license. Notwithstanding the foregoing, in no event will {_Licensee} be compelled to negotiate a {_Sublicense} [within the field of X/for X indications], it being understood and agreed that any such {_Sublicense} would be competitive with or otherwise materially impair {_Licensee}'s business as proposed to be conducted. |
| UnmetNeeds. | = | [G/Z/Base] |
| InstitutionReserveRights.Ti | = | Institution Reservation of Rights |
| InstitutionReserveRights.sec | = | Without limiting any other rights it may have, {_Licensor} retains, on behalf of itself, the right to practice or have practiced the {_Patent_Rights}, and to use or have used the {_Licensed_Know-How} for any research, public service, internal (excluding any studies that are required to be reported to the FDA under 21 CFR Parts 58 and/or 312) and/or educational purposes with non-profit research institutions, including sponsored research and collaborations with such non-profit research institutions, and to publish their respective results, and the right to grant the same limited rights to other non-profit research institutions; provided that {_Licensor} will, and will include in any grant of rights to such non-profit research institutions the obligation to, use its best efforts to provide a draft of any planned disclosure from the laboratory of [Principal Investigator] based upon the foregoing to {_Licensee} 45 days in advance, and if {_Licensee} determines new patent applications need to be filed in order to protect the {_Patent_Rights}, {_Licensed_Know-How} or {_Improvements}, then {_Licensor} agrees to delay such disclosure by an additional delay of 45 days during which the {_Licensee} will prepare and file patent applications with respect to the foregoing at its own cost. The grant of rights to the {_Licensed_Technology} is subject to any existing right of the U.S. Government under Title 35, United States Code, Section 200 et seq. and under 37 Code of Federal Regulations, Section 401 et seq., (the (“{DefT.Bayh_Dole_Act}”) including but not limited to the grant to the U.S. Government of a nonexclusive, nontransferable, irrevocable, paid-up license to practice or have practiced any invention conceived or first actually reduced to practice in the performance of work for or on behalf of the U.S. Government throughout the world. Licensed Products shall be substantially manufactured in the United States to the extent (if at all) required by 35 U.S.C. Section 204. |
| InstitutionReserveRights. | = | [G/Z/Base] |
| Audit.Ti | = | Audit |
| Audit.sec | = | No more than once per calendar year, {_Licensor} may appoint a qualified audit firm to audit Licensee’s books and records relating to Licensee’s payments under the {_License_Agreement}. Such audit shall be conducted during normal business hours without unreasonable disruption to Licensee’s business, upon 30 days’ advance written notice to {_Licensee}. In the event that the audit discloses an underpayment greater than [5-10%] of the amount due, {_Licensee} shall bear the costs of the audit. |
| Audit. | = | [G/Z/Base] |
| BoardObserver.Ti | = | Board Observer |
| BoardObserver.sec | = | Up until the {_Licensee} completes its first round of institutional investment [and thereafter by mutual agreement] {_Licensor} may have a Board observer seat. |
| BoardObserver. | = | [G/Z/Base] |
| Assign.Ti | = | Assignment |
| Assign.sec | = | Neither party may assign the {_License} to a third party without the prior consent of the other party; provided that {_Licensee} may assign the {_License} without the prior consent of {_Licensor} (i) to any {_Affiliate} and (ii) in connection with a {_Change_of_Control}. |
| Assign. | = | [G/Z/Base] |
| DisputeResolution.Ti | = | Dispute Resolution |
| DisputeResolution.sec | = | A senior representative of each party shall first engage in good faith efforts to resolve the dispute, for a period of 30 days from the date that one party notifies the other of its desire to commence Standard Dispute Resolution. If the dispute is not resolved within such time period, the parties shall submit the matter to arbitration under the AAA Commercial Arbitration Rules (with the option to use AAA Expedited Procedures by mutual agreement). The parties must agree to a single arbitrator, and if they cannot agree, one shall be appointed by the President of the City Bar Association of the city in which one of the parties is located (the choice of such city to be determined by a coin toss), provided that sole arbitrator must be experienced in the structuring and negotiation of licenses and commercial agreements in the life sciences industry and be impartial and independent. The arbitration will be conducted over a mutually agreed upon video conferencing platform, unless the parties agree to conduct it live in a mutually agreeable location. Except for the appointment of the arbitrator, which shall follow the timeline set forth in the AAA Road Map (www.adr.org/sites/default/files/document_repository/AAA197_Arbitration_Road_Map.pdf), all the other time periods specified therein shall be cut in half. The parties waive any rights to punitive damages. The parties shall evenly share all costs of such arbitration. This process is referred to as “{DefT.Standard_Dispute_Resolution}”. |
| DisputeResolution. | = | [G/Z/Base] |
| GoverningLaw.Ti | = | Governing Law |
| NVCA-Note | = | Certain institutions will be required by statute to use the laws of their state as governing law. Where the parties are not able to agree, they may expressly state: “the parties agree to remain silent with respect to choice of law”. |
| GoverningLaw. | = | [G/Z/Base] |
| 00.sec | = | Exhibit A{LicensedRights.sec} Defined Terms{DefinedTerms.sec} |
| = | [G/Z/Base] | |
| DefinedTerms. | = | [G/NVCA/2020/LifeScience-License-TermSheet/DefinedTerms/0.md] |
| DefT. | = | [G/NVCA/2020/LifeScience-License-TermSheet/Z/Def/Target.md] |
| _ | = | [G/NVCA/2020/LifeScience-License-TermSheet/Z/Def/Link.md] |
| !!! | = | # |
| SecName | = | |