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EXCLUSIVE LICENSE AGREEMENT
dated _____________, 20__
between
[COMPANY NAME]
and
UNIVERSITY OF KANSAS
DRAFT
FOR DISCUSSION PURPOSES ONLY
The submission of this draft for review or its negotiation, or the negotiation of the transaction described
herein does not constitute an offer and the execution of this Agreement by [Licensee] does not constitute a
binding contract until such time as it has been executed by an authorized officer of the University of Kansas.
Rev. 4-14-21
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TABLE OF CONTENTS
ARTICLE l. DEFINITIONS ............................................................................................................................................................................ 4
ARTICLE 2. LICENSE GRANT..................................................................................................................................................................... 6
ARTICLE 3. TERM OF AGREEMENT ....................................................................................................................................................... 8
ARTICLE 4. FEES & ROYALTIES ............................................................................................................................................................... 8
ARTICLE 5. COMMERCIAL DILIGENCE & MILESTONES ............................................................................................................... 9
ARTICLE 6. SUCCESS FEE .......................................................................................................................................................................... 10
ARTICLE 7. CONFIDENTIALITY ............................................................................................................................................................. 10
ARTICLE 8. QUARTERLY & ANNUAL REPORTS ............................................................................................................................... 10
ARTICLE 9. PAYMENTS, RECORDS and AUDITS ............................................................................................................................... 11
ARTICLE 10. PATENT MARKING ............................................................................................................................................................ 12
ARTICLE 11. PATENT PROSECUTION AND MAINTENANCE ..................................................................................................... 12
ARTICLE 12. TERMINATION BY LICENSOR ...................................................................................................................................... 13
ARTICLE 13. TERMINATION BY LICENSEE ....................................................................................................................................... 14
ARTICLE 14. DISPOSITION OF LICENSED PRODUCTS ON HAND ........................................................................................... 14
ARTICLE 15. WARRANTY BY LICENSOR ............................................................................................................................................. 14
ARTICLE 16. INFRINGEMENT ................................................................................................................................................................. 15
ARTICLE 17. INSURANCE .......................................................................................................................................................................... 15
ARTICLE 18. WAIVER .................................................................................................................................................................................. 16
ARTICLE 19. ASSIGNABILITY .................................................................................................................................................................. 16
ARTICLE 20. INDEMNIFICATION BY LICENSEE ............................................................................................................................. 16
ARTICLE 21. NOTICES ................................................................................................................................................................................ 17
ARTICLE 22. REGULATORY COMPLIANCE ......................................................................................................................................... 17
ARTICLE 23. GOVERNING LAW ............................................................................................................................................................. 18
ARTICLE 24. RELATIONSHIP OF PARTIES ......................................................................................................................................... 18
ARTICLE 25. USE OF NAMES .................................................................................................................................................................... 18
ARTICLE 26. DISPUTE RESOLUTION.................................................................................................................................................... 18
ARTICLE 27. GENERAL PROVISIONS ................................................................................................................................................... 19
EXHIBIT “A” .................................................................................................................................................................................................... 21
EXHIBIT “B” .................................................................................................................................................................................................... 22
EXHIBIT “C” .................................................................................................................................................................................................... 23
EXHIBIT “D”.................................................................................................................................................................................................... 24
EXHIBIT “E” .................................................................................................................................................................................................... 27
EXHIBIT “F”..................................................................................................................................................................................................... 29
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LICENSE AGREEMENT
This license agreement (“Agreement”) is entered into this ______ day of __________, 20__ (Effective Date) by
and between the University of Kansas, a public research university having its principal place of business at 1450 Jayhawk
Blvd., Lawrence, KS 66045, hereinafter referred to as “KU” or “Licensor,” and [Company Name], having its principal
place of business at _____________________________, hereinafter referred to as “Licensee.”
SUMMARY OF TERMS
The terms set forth below shall apply to this Agreement:
• Field of Use:
• Territory:
• Patent royalty rate: 2% of Net Sales
• Success Fee Rate: 0.95%
• Financial Diligence Milestones:
o Licensee will raise no less than $____________, in startup funding by [Date]
o Licensee will raise no less than $____________, in second round of funding by [Date]
• Non-Financial Commercial Diligence Milestones:
o Technical Milestone 1:
o Technical Milestone 2:
o Technical Milestone 3:
o Technical Milestone 4:
o Technical Milestone 5:
WITNESSETH
WHEREAS, certain inventions, generally characterized as [Invention Title] and assigned KU Ref # ______,
hereinafter collectively referred to as “the Invention”, have been made in the course of research at the University of
Kansas conducted by [Inventors] and are Covered By Patent Rights (as defined below);
WHEREAS, the University of Kansas and the University of Kansas Medical Center (hereinafter collectively referred to
as “KU”) and KU Center for Technology Commercialization Inc. , a Kansas non-profit § 501(c)(3) corporation, and an
affiliate of KU, having its principal place of business at 2029 Becker Drive, Suite 142, Lawrence, KS 66047 (hereinafter
referred to as “KUCTC”) have an agreement wherein KUCTC is the manager of intellectual property owned by KU;
WHEREAS, Licensor desires that the Patent Rights be developed and utilized to the fullest extent so that their benefits
can be enjoyed by the general public;
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WHEREAS, Licensee wishes to obtain from Licensor a license under the Patent Rights for the commercial development,
production, manufacture, use and sale of Licensed Products and/or Licensed Methods, and Licensor is willing to grant
such a license upon the terms and conditions hereinafter set forth;
[If federal funding used-WHEREAS, the Patent Rights were developed in the course of research sponsored in part
by the U.S. Government, and as a consequence are subject to overriding obligations of Licensor to the U.S. Government;]
NOW THEREFORE, for and in consideration of the covenants, conditions and undertakings hereinafter set
forth, the parties hereby agree as follows:
ARTICLE l. DEFINITIONS
1.1 “Affiliate” means any company or other business entity that, directly or indirectly, controls, or is controlled by,
or is under common control by Licensee. Solely for purposes of this definition, the term “control” means the
possession of the power to direct or cause the direction of the management and policies of the entity, whether
through ownership of voting securities or by contract. Control will be presumed if an entity owns, either of
record or beneficially, at least fifty percent (50%) of the voting stock of the other entity. An entity will be deemed
an Affiliate only while such ownership or control relationship continues.
1.2 “…Covered By…” means a claim or claims within any pending or issued patent included in the Patent Rights
claiming all, a portion, or a component, or step of a Licensed Product or Licensed Method.
1.3 “Commercially Diligent Efforts” means, with respect to a Licensed Product and/or Licensed Method, the
diligent exercise, dedication and expenditure of efforts, money, personnel, and resources as reasonably needed
to develop, manufacture, market, and sell the Licensed Product and/or Licensed Method. Such efforts shall be
documented and must be consistent with those utilized by companies of similar size and type that have
successfully developed products and services similar to the Licensed Product and/or Licensed Method. At a
minimum, Commercially Diligent Efforts shall be based upon the commercialization plan, attached as Exhibit G
and incorporated by reference, submitted to Licensor by Licensee as required under Article 5. In determining
Commercially Diligent Efforts with respect to a particular Licensed Product and/or Licensed Method, Licensee
may not reduce such efforts due to the competitive, regulatory, or other impact of any other product or method
that it owns, licenses, or is developing or commercializing.
1.4 “Effective Date” means the date identified above.
1.5 “Entity” means a corporation, an association, a joint venture, a partnership, a trust, a business, an institution, an
individual, a government or political subdivision thereof, including an agency, or any other organization that can
exercise independent legal standing.
1.6 “Fair Market Value” means the cash consideration which Licensee or its Sublicensee would realize from an
unaffiliated, unrelated buyer in an arm’s length sale of an identical item sold in the same quantity, under the same
terms, and at the same time and place.
1.7 “Field of Use” means _____________________.
1.8 “Insolvent” means being unable to meet one’s debt obligations to another Entity as such debt obligations
become due and not being able to provide reasonable financial assurances of becoming able to meet such
obligations.
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1.9 “Licensed Product” means any product, apparatus, kit or component part thereof, or any other subject matter,
the manufacture, design, creation, use, importation, distribution, or sale of which is Covered By any claim or
claims included within the Patent Rights.
1.10 “Licensed Method” means any method, procedure, process or other subject matter, the practice, manufacture,
use, or sale of which is Covered By any claim or claims included within the Patent Rights.
1.11 “Net Sales” means the gross revenue and other consideration paid or given to Licensee or its Affiliates or
Sublicensees for Licensed Products and/or Licensed Method which are sold, leased, or otherwise
commercialized by or for Licensee or any of its Affiliates or Sublicensees; however, sales or other transfers of
Licensed Products and/or practice of Licensed Methods between Licensee and its Affiliates shall be excluded
from the computation of Net Sales, and no payments will be payable to Licensor on such sales or transfers
except where such Affiliates are end users or consumers; less the following deductions, directly attributable to
the sale of such Licensed Product and/or Licensed Method and specifically identified on the invoice, and
borne by the seller to the extent they are included in such gross revenue or other consideration:
a) cash and/or quantity discounts actually granted to purchases of a Licensed Product and/or Licensed
Method;
b) allowances or credits to third parties for rejections or returns;
c) excise taxes, tariffs and duties applicable to sales of Licensed Product in finished package form that the
Licensee has to pay on such sales; and,
d) outbound transportation charges prepaid or allowed.
A Licensed Product and/or Licensed Method shall be considered sold when it is shipped, delivered, or invoiced,
whichever is earlier. No deductions shall be made from Net Sales for commission paid to individuals whether
they are with independent sales agencies or are regularly employed by Licensee or its Affiliates or Sublicensees
and are on its or their payroll, or for the cost of collections. In the event Licensee transfers a Licensed Product
to and/or transfers or performs a Licensed Method for a third party in a bona fide arm’s length transaction, for
consideration, in whole or in part, other than cash, then the Net Sales price for such Licensed Product and/or
Licensed Method shall be deemed to be the standard invoice price then being invoiced by Licensee in an arm’s
length transaction with similar companies and in the absence of such standard invoice price, then the reasonable
Fair Market Value of the Licensed Product and/or Licensed Method. Components of Net Sales shall be
determined in the ordinary course of business using the accrual method of accounting in accordance with
generally accepted accounting practices.
If Licensee or any Affiliate or Sublicensee sells, leases or otherwise commercializes any Licensed Product and/or
Licensed Method at a reduced fee or price for the purpose of promoting other products, goods or services or for
the purpose of facilitating the sale, license or lease of other products, goods or services, then Licensee shall pay
to Licensor, and each such Affiliate and Sublicensee shall be obligated to pay to Licensor, a royalty under Article
4 based upon the Fair Market Value of the License Product and/or Licensed Method.
1.12 “Patent Rights” means and includes all of the following Licensor intellectual property: The United States
patents and/or patent applications listed in Exhibit “A”; United States patents issued from the applications
listed in Exhibit “A” and from divisionals and continuations (other than continuations-in-part) of these
applications and any reissues of such United States patents; claims of continuation-in-part applications and
patents directed to subject matter specifically described in the patent(s) and/or patent application(s) listed in
Exhibit “A”; claims of all foreign applications and patents which are directed to subject matter specifically
described in the United States patents and/or patent applications listed in Exhibit “A”; and term extensions,
supplementary protection certificates and other governmental actions which provide exclusive rights to a
product beyond the original patent expiration date.
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1.13 “Regulatory Exclusivity” means any exclusive marketing rights or data exclusivity rights conferred by any
Regulatory Authority (e.g. FDA etc.) with respect to a product other than Patents, including orphan drug
exclusivity, new chemical entity exclusivity, data exclusivity, or pediatric exclusivity.
1.14 “Sublicensee” means any party other than an Affiliate which enters into an agreement or arrangement with
Licensee or receives a license grant from Licensee under the Patent Rights, to manufacture, have manufactured,
offer for sale, sell, lease, use, practice, and/or import the Licensed Product or Licensed Method, subject to the
then-current applicable article, item, service, technology, and technical data-specific requirements of the U.S.
export laws and regulations.
1.15 “Success Fee Rate” means the rate (0.95%) that will be used to calculate the amount the Licensee
shall pay to Licensor upon a Liquidation Event or Initial Public Offering in accordance to Exhibit E
1.16 “Tangible Research Property” means the materials and other property that Licensor provides to
Licensee pursuant to this Agreement, as listed in Exhibit A.
1.17 “Technical Information” means the information, know-how, data, and methods not available in the
public domain, which Licensor provides to Licensee pursuant to this Agreement, as listed in Exhibit A.
1.18 “Territory” means the countries and other territories set forth under Summary of Terms, but
excluding those countries and territories to which export of technology or goods is prohibited by
applicable U.S. export control laws and regulations.
1.19 "USD" or "$" means the lawful currency of the United States of America
ARTICLE 2. LICENSE GRANT
2.1 License Grants and Restrictions
2.1.1 Subject to the terms and conditions set forth herein, Licensor hereby grants to Licensee, and Licensee hereby
accepts, a non-transferable (subject to Article 19), royalty-bearing exclusive license to make, have made, use
and sell any Licensed Product and to practice any Licensed Method in the Field of Use under Licensor’s Patent
Rights throughout the Territory. This grant is subject to the payment by Licensee to Licensor of all
consideration required under this Agreement, and subject to any rights of the Government of the United States
as set forth in Section (2.2).
2.1.2 Subject to the terms and conditions of this Agreement, Licensor hereby grants to Licensee, and Licensee
hereby accepts, a non-transferable (subject to Article 19), non-exclusive license, in the Field of Use and in the
Territory, for the Term (as defined below) of this Agreement, to use the Technical Information and Tangible
Research Property solely for the purpose of exploiting the license granted to Licensee in 2.1.1 above.
2.1.3 The grant in 2.1.1 & 2.1.2 is further subject to rights retained by Licensor and KU to:
a. publish the general scientific findings from research conducted in whole or in part at KU related to the
Patent Rights;
b. manufacture, have manufactured, use, practice, or transfer the Patent Rights for research, teaching, and
other educationally-related purposes;
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c. to permit all other non-profit and/or academic research institutions the right to use the Patent Rights,
to make, have made, and use any Licensed Product, and to practice any Licensed Method for such
organizations' internal non-commercial research purposes;
d. KU retains the right to use Patent Rights, Technical Information, and Tangible Research Property for
research and educational purposes; and
e. KU retains all ownership rights in the Patent Rights, Technical Information, and Tangible Research
Property. Licensee agrees that it will not do any act or thing which would in any way contest KU’s
ownership in, or otherwise derogate from the ownership by KU, of any rights in the Patent Rights,
Tangible Research Property, and/or Technical Information.
2.2 [If federally funded-The license granted in Section 2.1 hereof is expressly made subject to a non-exclusive,
irrevocable, royalty-free license heretofore granted to the U.S. Government and in the general form as attached
hereto as Exhibit “B” and incorporated herein by reference.]
2.3 Affiliates
Licensee may extend the license granted herein to any Affiliate if the Affiliate consents in writing to be bound by
this Agreement to the same extent as Licensee; provided, however, that any fee or other consideration paid to
Licensee in consideration of such extension will be subject to the provisions of Section 2.4 as if the Affiliate were
a Sublicensee. Other agreements or arrangements with Affiliates relating to Patent Rights which result in the sale
of Licensed Product(s)/and or Licensed Method(s) will be subject to the royalty payment and other applicable
payment provisions of this Agreement
2.4 Sublicensing
Licensor hereby grants to Licensee the right to enter into sublicensing agreements with Sublicensees, provided
that Licensee has current exclusive rights thereto in the Territory being sublicensed pursuant to Section 2.1 and
subject to the following:
a. Any sublicense granted by Licensee to a Sublicensee shall incorporate all of the terms and conditions of
this Agreement, which shall be binding upon each Sublicensee as if such Sublicensee were a party to this
Agreement. Licensee shall collect and guarantee all payments due Licensor from Sublicensee(s). In each
such sublicense, the Sublicensee will be prohibited from granting further sublicenses;
b. If Licensee becomes Insolvent, Licensor’s proportionate share of all payments then or thereafter due
and owing to Licensee from its Sublicensees for the sublicense of the Patent Rights will, upon written
notice from Licensor to any such Sublicensee, become payable directly to Licensor by Sublicensee for
the account of Licensee;
c. Licensee shall within thirty (30) days of: (a) execution, provide Licensor with a copy of each sublicense
granted by Licensee hereunder, and any amendments thereto or terminations thereof; and (b) receipt,
summarize, and deliver copies of all reports due to Licensee from Sublicensee(s); and
d. If this Agreement is terminated for any reason, Licensor shall have the sole option to (a) terminate any
or all sublicense(s) and all rights granted thereunder, or (b) require Licensee to immediately assign all of
its right, title, and interest to all sublicense(s) to Licensor, including the right to receive all income from
the sublicense(s). Licensee shall, prior to execution of each sublicense, make the intended Sublicensee(s)
aware of this contingency.
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ARTICLE 3. TERM OF AGREEMENT
This Agreement shall be in full force and effect from the Effective Date until the end of the term of the last-to-
expire of Licensor’s Patent Rights licensed under this Agreement or Regulatory Exclusivity (“Term”), unless otherwise
terminated by operation of law or by acts of the parties pursuant to the terms of this Agreement.
ARTICLE 4. FEES & ROYALTIES
4.1 License Issue Fee:
There is no License Issue Fee.
4.2 License Maintenance Fee :
There is no License Maintenance Fee.
4.3 Running Royalty
As consideration for the license under this Agreement, Licensee shall pay to Licensor an earned royalty of two
percent (2.0%) of Net Sales. Earned royalties shall accrue in each country for the duration of Patent Rights or
Regulatory Exclusivity in that country.
4.4 Minimum Royalty
There will be no minimum royalties due.
4.5 Sublicense Fees and Royalties
(a) Licensee shall pay to Licensor thirty five percent (35%) of any lump sum fee that is not an earned royalty,
including but not limited to any fixed fee, license fee, milestone payment, unearned portion of any minimum
royalty payment, equity, joint marketing fee, intellectual property cross license, research and development
funding in excess of Licensee’s cost of performing such research and development, and any other property,
consideration, or thing of value given or exchanged for a sublicense regardless of how the Licensee and
Sublicensee characterize such payments or consideration (collectively, “Sublicense Income”). Once Licensee
has raised over ten million dollars ($10M) in funding or five years have passed from the Effective Date,
whichever occurs first, the sublicensing rate in this Section 4.5(a) shall decrease from thirty five percent
(35%) to fifteen percent (15%).
(b) All such consideration received by Licensee shall be fully auditable by Licensor. Licensee shall not receive
from Sublicensee(s) anything of value in lieu of cash payments in consideration for any sublicense under this
Agreement without the express prior written permission of Licensor. Any non-cash consideration, including,
without limitation, equity in other companies or equity investments in Licensee, received by the Licensee
from any Sublicensee(s) will be valued at its Fair Market Value as of the date of receipt by Licensee.
(c) In addition, Licensee shall pay to Licensor a royalty on Net Sales made under any sublicense which royalty
rate shall be fifty percent (50%) of the royalty rate charged by Licensee on Net Sales by such Sublicensee;
and in no event shall the royalty rate be less than one percent (1%) of Net Sales by Sublicensee.
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4.6 Past and Future Patent Expenses
Licensor will pay past patent expenses incurred by Licensor, before the Effective Date, which are related to filing
and prosecuting the patent application included in the Patents Rights in Exhibit A, up to a maximum of twenty
thousand dollars ($20,000). In the event past patent expenses exceed $20,000, Licensee shall reimburse Licensor
the amount in excess of $20,000. As of the Effective Date, Licensee shall reimburse Licensor for all future patent
expenses as set forth in Article 11 hereof.
ARTICLE 5. COMMERCIAL DILIGENCE & MILESTONES
5.1 Commercial Diligence
Upon execution of this Agreement, Licensee shall diligently proceed with Commercially Diligent Efforts to
develop, manufacture, practice, sell, and use the Licensed Products and/or Licensed Methods in order to make
them readily available to the general public as soon as possible on commercially reasonable terms. Licensee shall
continue active, Commercially Diligent Efforts for one or more Licensed Product(s) and/or Licensed Method(s)
throughout the term of this Agreement (“Actively Commercializing”). In addition, Licensee shall perform at
least the following obligations as part of its due diligence activities hereunder:
[NOTE: The specific Due Diligence milestones in Section 5.1 are representative only; others may be substituted as long as they are
objective and related to successful commercialization]
(a) Licensee commercialization plan detailing each phase of development, the target markets and time
frames toward first sale of the Licensed Products and Licensed Methods is attached in Exhibit F.
Licensee shall keep Licensor apprised on any changes in the commercialization plan;
(b) Licensee shall secure its startup round of funding which shall be no less than $_______, on or before
____________;
(c) Licensee shall secure its second round of funding which shall be no less than $_______, on or before
____________;
(d) Technical Milestone 1;
(e) Technical Milestone 2;
(f) Technical Milestone 3;
(g) Technical Milestone 4;
(h) Technical Milestone 5;
(i) Licensee shall develop a working model on or before ______________;
(j) Licensee shall spend at least ___________ dollars ($_________) on research, development, and
commercialization of Licensed Products and/or Licensed Methods during the ____-year period
following the Effective Date of this Agreement; and
(k) Licensee shall have Net Sales by ________________.
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ARTICLE 6. SUCCESS FEE
6.1 In the event that Licensee becomes subject to a Liquidation Event or Initial Public Offering (as defined in
Exhibit E), Licensee shall pay Licensor a Success Fee at a Success Fee Rate of 0.95%, which shall be
calculated in accordance to Exhibit E.
ARTICLE 7. CONFIDENTIALITY
7.1 Licensee and Licensor acknowledge that either party may provide certain information to the other with regard to
the Invention that is considered to be confidential. Licensee and Licensor shall take all reasonable precautions
to protect such confidential information. Such precautions shall involve at least the same degree of care and
precaution that the recipient customarily uses to protect its own confidential information, but in no circumstance
less than reasonable care.
7.2 Licensee acknowledges that Licensor is subject to the Kansas Open Records Act, K.S.A. 45-215 et seq. Licensor
shall keep confidential any information provided to Licensor by Licensee that Licensee considers confidential, to
the extent allowable under the Kansas Open Records Act.
ARTICLE 8. QUARTERLY & ANNUAL REPORTS
8.1 Quarterly and Annual Royalty Report
Within thirty (30) days after the calendar year in which Net Sales first occur, and within 30 days after each calendar
quarter thereafter, Licensee shall provide Licensor with a written report detailing all sales and uses, if any, made
of Licensed Products and/or Licensed Methods during the preceding calendar quarter, and detailing the amount
of Net Sales made during such quarter and calculating the royalties due to Licensor pursuant to Article 4 hereof.
Each report shall include at least the following:
a. number or volume of Licensed Products manufactured, leased, and sold by and/or for Licensee,
Affiliates and all Sublicensees;
b. accounting for all Licensed Methods used or sold by and/or for Licensee, Affiliates, and all Sublicensees;
c. accounting for Net Sales, noting the deductions applicable as provided in Section 1.11;
d. royalties, earned royalties, royalties due on other payments from Sublicensees, Affiliates, and assignees
due under Articles 4 and 19;
e. total royalties due to Licensor;
f. names and addresses of all Sublicensees;
g. the amount spent on product development; and
h. the number of full-time equivalent employees working on the Licensed Products and/or Licensed
Methods.
Each report shall be in substantially similar form as Exhibit “C” attached hereto. Each such report shall be
signed by an officer of Licensee (or the officer’s designee). With each such report submitted, Licensee shall pay
to Licensor the royalties and fees due and payable under this Agreement. If no royalties shall be due, Licensee
shall so report. Licensee’s failure to submit a royalty report in the required form will constitute a breach of this
Agreement. Licensee will continue to deliver royalty reports to Licensor after the termination or expiration of
this Agreement until such time as all Licensed Product(s) and/or Licensed Method(s) permitted to be sold after
termination have been sold or destroyed.
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8.2 Progress Report and Commercialization Plan
Commencing on January 1, 20__, and on each January 1 thereafter, Licensee shall submit to Licensor a written
report covering Licensee’s (and any Sublicensee’s) progress in (a) development and testing of all Licensed
Products and Licensed Methods; (b) achieving the due diligence milestones specified herein; (c) preparing, filing,
and obtaining of any approvals necessary for marketing the Licensed Products and Licensed Methods; and (d)
plans for the upcoming year in commercializing the Licensed Product(s) and Licensed Method(s). Each report
shall be in substantially similar form and contain at least the information required by Exhibit “D” attached hereto
and incorporated herein by this reference.
8.3 On or before the ninetieth (90
th
) day following the close of Licensee’s fiscal year, Licensee shall provide Licensor
with Licensee’s certified financial statements for the preceding fiscal year including, at a minimum, a balance
sheet and income statement.
8.4 In addition to the regular reports required by Section 8.1, 8.2, and 8.3 hereof, Licensee shall provide a written
report to Licensor of the date of first occurrence of Net Sales in each country within sixty (60) days of the
occurrence thereof.
ARTICLE 9. PAYMENTS, RECORDS and AUDITS
9.1 Payments
Licensee shall pay all royalties accruing to Licensor in U.S. Dollars, without deduction of exchange, collection,
wiring fees, bank fees, or any other charges, within thirty (30) days following the calendar quarter in which Net
Sales occur. Each payment will reference KUCTC Technology ID #___________. All payments to Licensor
will be made in United States Dollars by wire transfer or check payable to the KU Center for Technology
Commercialization, Inc.., and sent to:
KUMC Research Institute, Inc.
Attn: KUCTC
3901 Rainbow Blvd, Mail Stop 1039
Kansas City, KS, 66160
(913) 588-1261
Tax Identification Number: 26-2838693
ACH or Wire Transfer Information:
Commerce Bank of Kansas City
1000 Walnut P.O. Box 13686
Kansas City, MO 64199-3686
Routing #: 101000019
Account#:700046965
Account Type: Checking
Swift # CBKC US 44
For converting any Net Sales made in a currency other than United States Dollars, the parties will use the
conversion rate published in the Wall Street Journal, or other industry standard conversion rate approved in writing
by Licensor for the last day of the calendar quarter for which such royalty payment is due or, if the last day is not
a business day, the closest preceding business day.
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9.2 Late Payments
In the event royalty payments or other fees are not received by Licensor when due hereunder, Licensee shall pay
to Licensor interest charges at the rate of twelve percent (12%) per annum on the total royalties or fees due for
the reporting period.
9.3 Records
Licensee shall keep, and cause its Sublicensees and Affiliates to keep, complete, true, and accurate records and
books containing all particulars that may be necessary for the purpose of showing the amounts payable to
Licensor hereunder. Records and books shall be kept at Licensee’s principal place of business or the principal
place of business of the appropriate division of Licensee to which this Agreement relates.
9.4 Audit
Such books and the supporting data shall be open to inspection by Licensor or its agents, upon reasonable prior
notice to Licensee, at all reasonable terms for a term of five (5) years following the end of the calendar year to
which they pertain, upon reasonable prior notice to Licensee, for the purpose of verifying Licensee’s royalty
statement or compliance in other respects with this Agreement. Such access will be available to Licensor upon
not less than ten (10) days written notice to Licensee, not more than once each calendar year of the Term, during
normal business hours, and once a year for three (3) years after the expiration or termination of this Agreement.
Should such inspection lead to the discovery of a greater than five percent (5%) or five thousand US dollars
($5,000), discrepancy in reporting to Licensor’s detriment, Licensee agrees to pay the full cost of such inspection.
Whenever Licensee has its books and records audited by an independent certified public accountant, Licensee
will, within thirty (30) days of the conclusion of such audit, provide Licensor with a written statement, certified
by said auditor, setting forth the calculation of royalties, fees, and other payments due to Licensor over the time
period audited as determined from the books and records of Licensee.
ARTICLE 10. PATENT MARKING
Licensee shall permanently and legibly mark all Licensed Products made, used, or sold under the terms of this
Agreement, or their containers, in accordance with all applicable patent-marking and notice provisions under
Title 35, United States Code.
ARTICLE 11. PATENT PROSECUTION AND MAINTENANCE
11.1 Future Patent Expenses
Licensee will pay, within thirty (30) days of invoice, all future expenses for filing, prosecuting, enforcing, and
maintaining the Patent Rights that are licensed to Licensee hereunder, including without limitation, any taxes on
such Patent Rights. Licensee will receive such invoices directly from patent counsel; Licensor will receive a copy
of such invoice. Licensee shall pay such invoices directly to patent counsel with written confirmation of payment
to Licensor.
In the event that Licensee fails to pay any patent expenses required under this Agreement within sixty (60) days
of receipt of notification that such expenses are due, Licensee will be required within the following thirty (30)
day period to establish with a leading and first class bank, subject to approval by Licensor, an irrevocable and, if
so requested by Licensor, confirmed letter of credit (not restricted, unless otherwise jointly agreed upon) in the
amount of US$20,000 in favor of Licensor available immediately to secure the payment of patent expenses due
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Page 13 of 29
under this Agreement. Licensor may draw upon such letter of credit upon presentation of the letter notifying
Licensee of patent expenses due and payable and a statement from Licensor of Licensee’s failure to pay. In the
event that Licensee does not establish such letter of credit within such thirty (30) day period, Licensor may
unilaterally terminate this Agreement. Should Licensee decline or fail to pay the costs and legal fees for the
preparation, prosecution, and maintenance of any patent or patent application under this Agreement, Licensor
may at its discretion, either (i) exclude by written notice the patent or patent application from this Agreement,
without terminating the Agreement in its entirety and Licensee shall have no further rights thereto, or (ii) Licensor
may terminate this Agreement in full pursuant to Section 12.1 hereof. Any exclusion pursuant to this section
shall not relieve Licensee of any obligation or liability accrued hereunder prior to such exclusion, or rescind or
give rise to any right to rescind any payments made or other consideration given to Licensor hereunder prior to
the time such exclusion becomes effective. Such exclusion shall not affect in any manner any obligation due
Licensor by Licensee, arising under this Agreement prior to the date of such exclusion.
11.2 Patent Counsel
Licensor will work closely with Licensee to develop a suitable strategy for the prosecution and maintenance of
all Patents Rights; provided that Licensor will maintain final authority in all decisions regarding the prosecution
and maintenance of the Patent Rights. Licensor will confer with Licensee regarding the choice of patent counsel
and will identify to Licensee the patent attorney selected to file and prosecute the Patent Rights. It is intended
that Licensee will interact directly with the selected patent counsel in all phases of patent prosecution: preparation,
office action responses, filing strategies for continuation or divisional applications, and other related activities.
Licensor will request that copies of all documents prepared by the selected patent counsel be provided by patent
counsel to Licensee for review and comment prior to filing, to the extent practicable under the circumstances.
Licensee will be billed and will pay all documented costs and fees and other charges incident to the preparation,
prosecution, and maintenance of the Patent Rights within thirty (30) days of receipt of invoice from the selected
patent attorney. All patent applications and patents will be in the name of Licensor, owned by Licensor and
included as part of the Patent Rights licensed pursuant to this Agreement.
11.3 If Licensor agrees to allow Licensee to select the patent attorney, Licensor must consent, in writing, to such
selected patent attorney, or any subsequent or new patent attorney, which consent shall not be unreasonably
withheld. The selected patent attorney will agree to keep both Licensee and Licensor, as co-clients, equally
informed and involved as to all material information, material communications with governmental patent
offices, material issues and decisions, and related matters applicable to prosecuting the patent applications for
the Patent Rights and for maintaining the Patent Rights in good standing. Decisions for prosecuting the patent
applications will be made so as to obtain as broad of patent protection as is reasonable and practical under the
circumstances. Licensee will request that copies of all documents prepared by the patent attorney selected by
Licensee be provided to Licensor for review and comment prior to filing to the extent practicable under the
circumstances. Licensee will promptly notify Licensor of its plans to file, revise, or drop any patent application
or claim which may adversely affect the Patent Rights or the rights or royalties of Licensor in the Licensed
Product(s) under this Agreement. Licensee and the selected patent attorney shall not change any inventorship
designations and shall not drop or reduce any claim in a pending patent application which may adversely affect
the Patent Rights or royalties of Licensor.
ARTICLE 12. TERMINATION BY LICENSOR
12.1 If Licensee should: (a) fail to deliver to Licensor any statement or report required hereunder when due; (b) fail
to make any payment at the time that the same should be due; (c) violate or fail to perform any covenant,
condition, or undertaking of this Agreement to be performed by it hereunder; (d) cease active Commercially
Diligent Efforts to commercialize a Licensed Product(s); (e) file a bankruptcy action, or have a bankruptcy action
against it, or become Insolvent; or (f) enter into a composition with creditors, or have a receiver appointed for
it; then Licensor may give written notice of such default to Licensee. If Licensee should fail to cure such default
within thirty (30) days of such notice, the rights, privileges, and license granted hereunder shall automatically
terminate.
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12.2 If Licensee shall cease to carry on its business with respect to the rights granted in this Agreement, this Agreement
shall terminate upon thirty (30) days written notice by Licensor.
12.3 No termination of this Agreement by Licensor shall relieve Licensee of its obligation to pay any monetary
obligation due or owing at the time of such termination and shall not impair any accrued right of Licensor.
Licensee shall pay all attorneys’ fees and costs incurred by Licensor in enforcing any obligation of Licensee or
accrued right of Licensor. Articles 1, 7, 9, 14, 20, 21, 22, 23, 25, 26, and Sections 2.4, 8.1, 12.3, 15.2, 15.3, 17.3,
27.5, and 27.7 hereof shall survive any termination of this Agreement.
ARTICLE 13. TERMINATION BY LICENSEE
13.1 Licensee may terminate this Agreement, in whole or as to any specified patent, at any time and from time to time
without cause, by giving written notice thereof to Licensor. Such termination shall be effective one hundred
twenty (120) days after such notice and all Licensee’s rights associated therewith shall cease as of that date.
13.2 Any termination pursuant to Section 13.1 hereof shall not relieve Licensee of any obligation or liability accrued
hereunder prior to such termination, or rescind or give rise to any right to rescind any payments made or other
consideration given to Licensor hereunder prior to the time such termination becomes effective. Such
termination shall not affect in any manner any rights of Licensor arising under this Agreement prior to the date
of such termination.
13.3 No termination of this Agreement by Licensor shall relieve Licensee of its obligation to pay any monetary
obligation due or owing at the time of such termination and shall not impair any accrued right of Licensor.
Licensee shall pay all attorneys’ fees and costs incurred by Licensor in enforcing any obligation of Licensee or
accrued right of Licensor. Articles 1, 7, 9, 14, 20, 21, 22, 23, 25, 26, and Sections 2.4, 8.1, 13.3, 15.2, 15.3, 17.3,
27.5, and 27.7 hereof shall survive any termination of this Agreement.
ARTICLE 14. DISPOSITION OF LICENSED PRODUCTS ON HAND
Upon expiration or termination of this Agreement by either party, Licensee shall provide Licensor with a
written inventory of all Licensed Products in process of manufacture, in use, or in stock. Licensee may dispose
of any such Licensed Products within the ninety (90) day period following such expiration or termination,
provided, however, that Licensee shall pay royalties and render reports to Licensor thereon in the manner
specified herein.
ARTICLE 15. WARRANTY BY LICENSOR
15.1 Licensor warrants that it has the lawful right to grant the license set forth in this Agreement.
15.2 EXCEPT AS EXPRESSLY PROVIDED IN SECTION 15.1, THE PARTIES ACKNOWLEDGE AND
AGREE LICENSOR, ITS AFFILIATES, AGENTS, EMPLOYEES, AND THE INVENTORS HAVE
MADE NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, INCLUDING
BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT
DISCOVERABLE, ON THE VALIDITY OR ENFORCEABILITY OF PATENT RIGHTS. IN NO
EVENT SHALL LICENSOR, ITS AFFILIATES, AGENTS, EMPLOYEES, AND THE
INVENTORS BE HELD RESPONSIBLE FOR ANY DIRECT, SPECIAL, INDIRECT OR
CONSEQUENTIAL DAMAGES ARISING OUT OF OR IN CONNECTION WITH THE
EXERCISE OF PATENT RIGHTS, EVEN IF LICENSOR IS ADVISED IN ADVANCE OF THE
POSSIBILITY OF SUCH DAMAGES.
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Page 15 of 29
15.3 Nothing in this Agreement shall be construed as:
a. a warranty or representation by Licensor as to the validity, enforceability, or scope of any Patent Rights;
b. a warranty or representation by Licensor that the exercise or practice by the Licensee of the license
granted herein (including making, using, selling, offering for sale, or importing the Licensed Product or
Licensed Method) is or will be free from infringement of intellectual property rights of third parties;
c. an obligation by Licensor or KU to bring or prosecute actions or suits against third parties for patent
infringement, except as expressly provided in Article 15 hereof;
d. an obligation to furnish any know-how not provided in the Patent Rights or Technical Information;
and
e. conferring by implication, estoppel, or otherwise any license or rights under any patents of Licensor
other than Patent Rights.
15.4 Licensor’s total cumulative liability in connection with this Agreement and the Patent Rights, whether in contract
or tort or otherwise, will not exceed the amount of fees paid to Licensor under this Agreement within the twelve
months preceding the claim.
ARTICLE 16. INFRINGEMENT
16.1 If either party learns of a claim of infringement of any of Licensor’s Patent Rights licensed under this Agreement,
that party shall give prompt written notice of such claim to the other party. Licensor shall then use reasonable
efforts to terminate such infringement. In the event Licensor fails to abate the infringing activity within ninety
(90) days after such written notice or to bring legal action against the third party, Licensee may bring suit for
patent infringement. No settlement, consent judgment, or other voluntary final disposition of the suit may be
entered into without the consent of Licensor, which consent shall not be unreasonably withheld.
16.2 Any such legal action shall be at the expense of the party by whom suit is filed, hereinafter referred to as the
“Litigating Party.” Any damages or costs recovered by the Litigating Party in connection with a legal action filed
by it hereunder, and provided that the Litigating Party is reimbursed for its costs and expenses reasonably
incurred in the lawsuit, and after any royalties or other payments due to Licensor under Article 4 are paid, shall
be equally divided between Licensee and Licensor.
16.3 Licensee and Licensor shall cooperate with each other in litigation proceedings instituted hereunder, provided
that such cooperation shall be at the expense of the Litigating Party, and such litigation shall be controlled by the
Litigating Party.
ARTICLE 17. INSURANCE
17.1 Insurance Requirements
Beginning at the time any Licensed Product and/or Licensed Method is being distributed or sold (including for
the purpose of obtaining any required regulatory approvals) by Licensee, Affiliate, or a Sublicensee, Licensee will,
at its sole cost and expense, procure and maintain commercial general liability insurance issued by an insurance
carrier with an A.M. Best rating of “A” or better in amounts not less than $1,000,000 per incident and $2,000,000
annual aggregate. Licensee will have Licensor, KUCTC, and their respective officers, employees and agents,
named as additional insureds. All rights of subrogation will be waived against Licensor and its insurers. Such
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Page 16 of 29
commercial general liability insurance will provide (i) product liability coverage; (ii) broad form contractual
liability coverage for Licensee’s indemnification under this Agreement; and (iii) coverage for litigation costs. The
specified minimum insurance amounts will not constitute a limitation on Licensee’s obligation to indemnify
Licensor, KU, and their respective officers, employees and agents, under this Agreement.
17.2 Evidence of Insurance and Notice of Changes
Licensee will provide Licensor with written evidence of such insurance upon request by Licensor. Licensee will
provide Licensor with written notice of at least thirty (30) days prior to the cancellation, non-renewal, or material
change in such insurance.
17.3 Continuing Insurance Obligations
Licensee will maintain such commercial general liability insurance beyond the expiration or termination of this
Agreement during (i) the period that any Licensed Product(s) and/or Licensed Service(s) developed pursuant to
this Agreement is being commercially distributed or sold by Licensee, any Affiliate, or any Sublicensee or agent
of Licensee; and (ii) for five (5) years after such period.
ARTICLE 18. WAIVER
No waiver by either party hereto of any breach or default of any of the covenants or agreements herein set
forth shall be deemed a waiver as to any subsequent and/or similar breach or default.
ARTICLE 19. ASSIGNABILITY
This Agreement is not assignable or otherwise transferable by Licensee without the prior written consent of
Licensor. Notwithstanding the foregoing, Licensee shall be free to assign this Agreement and its rights and obligations
hereunder without Licensor’s consent (a) to any Affiliate or (b) in connection with any sale of substantially all of Licensee’s
assets or business (or that portion of its assets or business related to the subject matter of this Agreement), merger,
acquisition, consolidation, reorganization, or other similar transaction, provided that (i) Licensee shall not be released of
its obligation existing at the time of such assignment and (ii) the assignee or successor to this Agreement confirms, in
writing, that it will be subject to and must comply with all terms, conditions, and obligations of this Agreement. The
failure of Licensee to comply with the terms of this paragraph shall be grounds for termination of the Agreement by
Licensor under Article 12.
ARTICLE 20. INDEMNIFICATION BY LICENSEE
Licensee shall indemnify, hold harmless, and defend Licensor, Licensor’s Affiliates, KUCTC, and their respective
officers, employees, inventors, affiliates, and agents, against any and all claims, suits, losses, damages, costs, liabilities, fees,
and expenses (including reasonable fees of attorneys) resulting from or arising out of or in connection with: (a) the exercise
of any license granted under this Agreement; (b) the breach of this Agreement by Licensee; (c) Licensee’s failure to comply
with any applicable laws, rules, or regulations, or (d) any act, error, or omission of Licensee, its officers, agents, employees,
Affiliates, or Sublicensees, except where such claims, suits, losses, damages, costs, fees, or expenses result solely from the
gross negligence, fraud, or intentional misconduct of the Licensor, its affiliates, officers, employees, or agents. Licensee
shall give Licensor prompt and timely written notice of any claim or suit instituted of which Licensee has knowledge that
in any way, directly or indirectly, affects or might affect Licensor, and Licensor shall have the right at its own expense to
participate in the defense of the same.
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ARTICLE 21. NOTICES
Any payment, notice, or other communication required or permitted to be given to either party hereto shall be
in writing and shall be deemed to have been properly given and effective: (a) on the date of delivery if delivered in person
during recipient’s normal business hours; or (b) on the date of attempted delivery if delivered by courier, express mail
service, or first-class mail, registered or certified. Such notice shall be sent or delivered to the respective addresses given
below, or to such other address as either party shall designate by written notice given to the other party as follows:
In the case of Licensee:
[COMPANY NAME]
____________________________________________
____________________________________________
In the case of Licensor:
KU Center for Technology Commercialization, Inc.
Attn: Director, KUCTC
2029 Becker Drive, #142
Lawrence, Kansas 66047
ARTICLE 22. REGULATORY COMPLIANCE
22.1 When required by local/national law, Licensee shall register this Agreement, pay all costs and legal fees connected
therewith, and otherwise ensure that the local/national laws affecting this Agreement are fully satisfied.
22.2 Licensee shall comply with all applicable U.S. laws dealing with the export and/or management of technology or
information. Licensee understands that the Arms Export Control Act (AECA), including its implementing
International Traffic In Arms Regulations (ITAR), and the Export Administration Act (EAA), including its
Export Administration Regulations (EAR), are some (but not all) of the laws and regulations that comprise the
U.S. export laws and regulations. Licensee further understands that the U.S. export laws and regulations include
(but are not limited to): (1) ITAR and EAR product/service/data-specific requirements; (2) ITAR and EAR
ultimate destination-specific requirements; (3) ITAR and EAR end user-specific requirements; (4) ITAR and
EAR end use-specific requirements; (5) Foreign Corrupt Practices Act; and (6) anti-boycott laws and regulations.
Licensee will comply with all then-current applicable export laws and regulations of the U.S. Government (and
other applicable U.S. laws and regulations) pertaining to the Licensed Product(s) and/or Licensed Method(s)
(including any associated products, items, articles, computer software, media, services, technical data, and other
information). Licensee certifies that it will not, directly or indirectly, export (including any deemed export), nor
re-export (including any deemed re-export) the Licensed Product(s) and/or Licensed Method(s) (including any
associated products, items, articles, computer software, media, services, technical data, and other information) in
violation of U.S. export laws and regulations or other applicable U.S. laws and regulations. Licensee will include
an appropriate provision in its agreements with its authorized Sublicensees to assure that these parties comply
with all then-current applicable U.S. export laws and regulations and other applicable U.S. laws and regulations.
22.3 [If federally funded-Licensee agrees that products used or sold in the United States embodying Licensed Products
or produced through use of the Licensed Method shall be manufactured substantially in the United States, unless
a written waiver is obtained in advance from the sponsoring federal agency.]
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ARTICLE 23. GOVERNING LAW
This Agreement shall be interpreted and construed in accordance with the laws of the State of Kansas, without
application of any principles of choice of laws.
ARTICLE 24. RELATIONSHIP OF PARTIES
In assuming and performing the respective obligations under this Agreement, Licensee and Licensor are each
acting as independent parties and neither shall be considered or represent itself as a joint venture, partner, agent, or
employee of the other.
ARTICLE 25. USE OF NAMES
25.1 By Licensee
Licensee shall not, without prior written consent of the Licensor, use the name or any trademark or trade name
owned by Licensor, KU, or by an affiliate of KU, in any publication, publicity, advertising, or otherwise, except
that Licensee may identify KUCTC as licensor of the Patent Rights and Licensed Products.
25.2 By Licensor
Licensor may use Licensee’s name in connection with Licensor’s publicity related to Licensor’s intellectual
property and commercialization achievements.
ARTICLE 26. DISPUTE RESOLUTION
Except for the right of either party to apply to a court of competent jurisdiction for a temporary restraining order,
a preliminary injunction, or other equitable relief to preserve the status quo or prevent irreparable harm, any and all claims,
disputes or controversies arising under, out of, or in connection with the Agreement, including but not limited to any
dispute relating to patent validity or infringement, which the parties shall be unable to resolve within sixty (60) days, shall
be mediated in good faith. The party raising such dispute shall promptly advise the other party in writing of such dispute.
By no later than five (5) business days after the recipient has received such written notice of a dispute, each party shall
have selected for itself a representative who shall have the authority to bind such party, and shall additionally have advised
the other party in writing of the name and title of such representative. By no later than ten (10) days after the date of
such written notice of a dispute, the party against whom the dispute shall be raised shall select a mediator in the Kansas
City area and such representatives shall schedule a date with such mediator for a hearing. The parties shall enter into
good faith mediation and shall share the costs equally. If the representatives of the parties have not been able to resolve
the dispute within fifteen (15) business days after such mediation hearing, then any and all claims, disputes, or
controversies arising under, out of, or in connection with this Agreement, including any dispute relating to patent validity
or infringement, shall be resolved through arbitration if the parties mutually consent, or through any judicial proceeding
either in the courts of the State of Kansas or in the United States District Court for the District of Kansas, to whose
jurisdiction for such purposes Licensee and Licensor each hereby irrevocably consents and submits. All costs and
expenses, including reasonable attorneys’ fees, of the prevailing party in connection with resolution of a dispute by
arbitration or litigation of such controversy or claim shall be borne by the other party.
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ARTICLE 27. GENERAL PROVISIONS
27.1 The headings of the sections are inserted for convenience of reference only and are not intended to be a part of
or to affect the meaning or interpretation of this Agreement.
27.2 This Agreement shall not be binding upon the parties until it has been signed below by or on behalf of each
party.
27.3 No amendment or modification of this Agreement shall be valid or binding upon the parties unless made in
writing and signed by both parties hereto.
27.4 This Agreement embodies the entire understanding of the parties and supersedes all previous communications,
representations or understandings, either oral or written, between the parties relating to the subject matter
thereof.
27.5 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.
27.6 This Agreement may be executed in any number of counterparts (electronic transmission of PDF documents
included), each constituting an original, but all such counterparts together constituting one and the same
instrument. Any party may also execute this Agreement using electronic signatures, and each party agrees that
any electronic signature will have the same legal significance as handwritten signatures. Each individual executing
this Agreement on behalf of a legal Entity does hereby represent and warrant to each other person so signing
that he or she has been duly authorized to execute this Agreement on behalf of such Entity.
27.7 In the event of any litigation, arbitration, judicial reference, or other legal proceeding involving the parties to this
Agreement to enforce any provision of this Agreement, to enforce any remedy available upon default under this
Agreement, or seeking a declaration of the rights of either party under this Agreement, the prevailing party shall
be entitled to recover from the other such attorneys’ fees and costs as may be reasonably incurred, including the
costs of reasonable investigation, preparation, and professional or expert consultation incurred by reason of such
litigation, arbitration, judicial reference, or other legal proceeding.
27.8 Except as required by law, neither party may disclose the financial terms of this Agreement without the prior
written consent of the other party, such consent not to be unreasonably withheld.
27.9 Licensee acknowledges that Licensor is a 501c(3) corporation; Licensee will exercise necessary precautions to
ensure that Licensor’s 501c(3) status is not jeopardized by Licensee’s activity under this Agreement by refraining
from engaging in prohibited activity, including, but not limited to, making political contributions or engaging in
substantial lobbying of legislators for or on behalf of Licensor.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, Licensor and Licensee have executed this Agreement by their respective officers hereunto
duly authorized, on the day and year hereinafter written.
“Licensee” “Licensor”
[COMPANY NAME]
THE UNIVERSITY OF KANSAS
By
By
(Signature)
(Signature)
Name
Name
Simon J. Atkinson, PhD
Title
Title
Vice Chancellor for Research
Date
Date
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Page 21 of 29
EXHIBIT “A”
PATENT RIGHTS
KU Ref No.
Matter
Application No.
Date of Filing
Title
Inventor(s)
TANGIBLE RESEARCH PROPERTY
TECHNICAL INFORMATION
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Page 22 of 29
EXHIBIT “B”
LICENSE TO THE UNITED STATES GOVERNMENT
This instrument confers to the United States Government, as represented by the _______________, a non-
exclusive, non-transferable, irrevocable, paid-up license to practice or have practiced on its behalf throughout
the world the following subject invention. This license will extend to all divisions or continuations of the patent
application and all patents or reissues, which may be granted thereon:
Invention Title:
Inventor(s):
Patent Application Serial No.:
Filing Date:
Country, if other than United States:
This subject invention was conceived and/or first actually reduced to practice in performance of a government-
funded project, Grant No.: __________________________
Principal rights to this subject invention have been left with the University of Kansas, subject to the provisions
of 37 CFR 401 and 45 CFR 8.
Signed: __________________________ Date: _________________________
Name: Simon J. Atkinson, PhD
Title: Vice Chancellor for Research
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EXHIBIT “C”
20__ ROYALTY REPORT
LICENSEE:____________________________________________ KUCTC Technology ID # _______________
Period Covered: From____________ Through: _____________
Prepared By: ___________________________________________ Date: _____________
Approved By: __________________________________________ Date: _____________
If Licensee has several licensed products, please prepare separate reports for each. Then, compile all licensed products into a
summary report.
Country and
Patent
Product or
Tradename
Quantity
Sold
Unit
Price
Gross
Sales
* Less
Allowances
Net
Sales
Royalty
Rate
Period Royalty Amount
This Year
Last Year
USA
$
$
$
$
$
#
Canada
#
Europe:
#
#
#
#
#
#
Japan
#
Other:
#
#
Sublicense #1
(name)
#
Sublicense #2
(name)
#
TOTAL:
$
$
$
$
$
Total Royalty Due: $___________________________
The following royalty forecast is non-binding and for internal planning only:
Royalty Forecast Under This Agreement: Qtr 1:________ Qtr 2:________ Qtr 3:________ Qtr 4:________
* On a separate page, please indicate the reasons for adjustments, if significant. Please refer to the following examples as
applicable: (1) cash, trade or quantity discounts actually allowed; (2) sales, use, tariff, customs duties or other excise taxes
directly imposed upon particular sales; (3) outbound transportation charges--prepaid or allowed, and (4) allowances or credits
to third parties for rejections or returns.
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EXHIBIT “D”
COMMERCIALIZATION REPORT
[Company Name]
[Tech Title and KUCTC Tech ID#] (if several, use oldest)
For period beginning ________________ and ending ___________ (“Period”)
Date: _________________
Contact Person: _______________ Phone: ____________ Email: ________________
1. Commercialization Efforts
Attach all requested documentation and attach additional pages as necessary. For all requirements include
efforts of all Sublicensees. If not applicable, please so indicate by N/A.
COMMERCIALIZATION REPORT
Net Sales Forecast
Country
Licensee’s
Licensed
Product and
Tradename
Sublicensee’s
Licensed
Product and
Tradename
Royalty
Rate
Current
Period Net
Sales
Year 1
after
current
Period
Year 2
after
current
Period
Year 3
after current
Period
eg: US
Product A
N/A
2%
$800.000
1.2M
1.8M
2M
Estimated number of jobs created as a result of this Licensed Product/Licensed Method:
____________
____ Yes ____ No In the designated reporting period, did your company or any Sublicensee of the
above-referenced technology have 500 or more employees? (This information is
required to determine and report large or small entity status in the United States.)
2. Product Development
Attach all requested documentation and attach additional pages as necessary. For all requirements include
efforts of all Sublicensees. If not applicable, please so indicate by N/A.
A. Provide the commercial name of any FDA-approved products, incorporating, using or that
are Licensed Products/Licensed Methods that have first reached the market during the
designated reporting Period. (This information is necessary for federal funding reporting
requirements)
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Pharmaceutical
Licensed Product (Name):
Estimated Date of First Sale:
FDA approval stage
Contact Person
Estimated Start Time
Estimated End Time
Estimated Budget
Preclinical
NDA
Phase I
Phase II
Phase III
Animal Studies
Mfg./Production Facility
Medical Devices (PMA or 510(k))
Licensed Product (Name):
Estimated Date of First Sale:
Class Type:
Completion Type:
FDA Approval Stage
Estimated Start Time
Estimated End Time
Estimated Budget
PMA
501(k)
IDE
HDE
Preclinical
Phase I
Phase II
Phase III
Mfg./Production Facility
Software
Licensed Product (Name):
Estimated Date of First Sale:
Contact Person
Estimated Start Time
Estimated End Time
Estimated Budget
Alpha Version
Beta Version
Commercial Version
3. Intellectual Property
Please provide type of intellectual property protection covering or related to the identified licensed
product.
Licensed Product (Name):
Country
Patent No./Patent Appl. No
/Copyright Registration No.
or Related IP
Owner
(Licensor/Licensee/Third
Party)
Inventor Name(s)/
Author(s)
Title(s)
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4. Marketing Activities
A. Provide an update covering Licensee’s projected marketing, manufacturing and operations
_________________________________________________________________________
_________________________________________________________________________
__________________________________________________________
Licensed
Product
Competitor’s
name
Competing
technology
Licensed
Product
Available/
Development
Stage
Marketing
Budget
Current
Marketing
Partner
Potential
Marketing
Partner
eg: Product A
Company B
$500,000
Company C
Company C
5. Additional efforts including, but not limited to, Due Diligence or Milestones specific to
licensee’s Agreement.
______________________________________________________________________
______________________________________________________________________
_______________________________________________________
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EXHIBIT “E”
Success Fee
Definitions
1. “Aggregate Consideration” means the amount equal to: (a) in the case of an Asset Sale, the sum of all cash and the
fair market value of all securities or other property transferred to Licensee at the time of the transaction, less all current
and long-term liabilities (but not contingent liabilities) of Licensee that are not discharged or assumed by the buyer (or
its affiliates) in connection with the Asset Sale, and all cash and the fair market value of all securities and other property
for Trailing Consideration payable to Licensee, when and if actually paid; or (b) in the case of a Merger or Stock Sale,
the sum of (i) all cash and the fair market value of all securities and other property transferred to the stockholders of the
Licensee (and any option holders or warrant holders) in return for their stock (or options or warrants) in the Licensee at
the time of the transaction, and (ii) all cash and the fair market value of all securities and other property transferred to
the stockholders of the Licensee (and any option holders or warrant holders) for Trailing Consideration payable to the
holders of Licensee’s securities, when and if actually paid.
2. “Initial Public Offering” means the effectiveness of a registration statement for the first sale of Licensee’s common
stock in a public offering registered under the Securities Act of 1933, as amended.
3. “Liquidation Event” means (a) a merger, share exchange or other reorganization (“Merger”), (b) the sale by one or
more stockholders of a majority of the voting power of the Licensee (“Stock Sale”) or (c) a sale of all or substantially all
of the assets of the Licensee (or that portion of its assets related to the subject matter of this Agreement) (“Asset Sale”)
in which for (a), (b), and (c) above, the stockholders of the Licensee prior to such transaction do not own a majority of
the voting power of the acquiring, surviving or successor entity, as the case may be. Notwithstanding the foregoing, a
Liquidation Event shall not include a bona fide financing transaction in which voting control of the Licensee transfers
to one or more persons or entities who acquire shares of Licensee capital stock from Licensee in exchange for either an
investment in Licensee or the cancellation of indebtedness owed by Licensee, or a combination thereof.
4. “Pre-Money Valuation” means the amount equal to the product of (a) the price per share of common stock sold in
the Initial Public Offering and (b) the total number of outstanding shares of common stock of Licensee immediately
prior to the closing of the Initial Public Offering, determined on a fully diluted, as converted into common stock basis,
giving effect to any stock split, stock dividend, stock combination, recapitalization or similar action impacting Licensee’s
capitalization that occurs, or is deemed to occur, upon consummation of the Initial Public Offering.
5. “Trailing Consideration” means any payments due for any deferred or contingent consideration payable to Licensee
or its security holders including, without limitation, any post-closing milestone payment, escrow or holdback of
consideration
Success Fee Calculation
6. Licensee shall pay Licensor an amount equal to the Success Fee Rate, as listed in the Summary of Terms, applied to
the (a) Aggregate Consideration (and Trailing Consideration, if any) for a Liquidation Event or (b) Pre-Money Valuation
for an Initial Public Offering (the “Success Fee”). The Success Fee shall be paid after only the first to occur of either a
Liquidation Event or Initial Public Offering. The Success Fee, when and if payable, shall be paid upon closing of the
event; except for Trailing Consideration which shall be payable within thirty (30) days after the actual receipt of such
Trailing Consideration by Licensee or its security holders.
7. For a Liquidation Event, the Success Fee shall be payable in the form of the proceeds payable to either Licensee or
its security holders, whether in cash, securities or other property, and in the same proportion such form of
consideration is payable to the Licensee or its security holders. Notwithstanding the foregoing, in the event the form of
consideration includes securities for which there is not an active public market, in lieu of paying that portion of the fee
with such securities, Licensee will make a cash payment to Licensor equal to the fair market value of such securities.
The valuation of such securities shall be determined in accordance with paragraph 9 below.
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8. For an Initial Public Offering, the Success Fee shall be payable in the form of cash.
9. The valuation of any securities or other property shall be determined by reference to the operative transaction
agreement for a respective Merger, Stock Sale or Asset Sale, provided that, if no such valuation is readily determinable
from such operative transaction agreement, then for securities for which there is an active public market: (a) if traded
on a securities exchange or market, the value shall be deemed to be the average of the closing prices of the securities on
such exchange or market over the 30-day period ending three days prior to the closing of such transaction; or (b) if
actively traded over-the-counter, the value shall be deemed to be the average of the closing bid prices over the 30-day
period ending three days prior to the closing of such transaction. For securities for which there is no active public
market, the value shall be the fair market value thereof as either (i) determined in good faith by the board of directors of
Licensee, which must be approved by Licensor, such approval not to be unreasonably withheld; or (ii) determined by a
third party appraiser appointed and paid for by Licensee.
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EXHIBIT “F”
COMMERCIALIZATION PLAN
