Exclusive Variety License Agreement between her Majesty the Queen in Right of Canada, as represented by the Ministry of Agriculture and Agri-Food (AAFC), and the Company

 

Variety Name / Identifier

BETWEEN:

HER MAJESTY THE QUEEN IN RIGHT OF CANADA

(As Licensor)

AND

[ the COMPANY]

(As Licensee)

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TABLE OF CONTENTS

VARIETY LICENSE AGREEMENT FOR [technology]

INTRODUCTION:

1.0 DEFINITIONS
1.1 "ADR"
1.2 "Dispute"
1.3 "Execution Date"
1.4 "Field of Use"
1.5 "License "
1.6 "Licensed Product(s)"
1.7 "Party"
1.8 "PBR"
1.9 "Pedigreed, Breeder, Select. Foundation, Registered, and Certified Seed"
1.10 "Sale" or "Sell"
1.11 "Sales Price"
1.12 "Taxes"
1.13 "Term" 1.14 "Territory"

2.0 GRANT & RESERVATIONS
2.1 Grant:
2.2 Carve Out
2.3 Sublicensing Permitted
2.4 Sublicensing Conditions
2.5 Sub-Licensee Consideration
2.6 Termination
2.7 The Company Shall Obtain Regulatory Permissions
2.8 Her Majesty Not Obligated

3.0 TERM
3.1 Initial Term
3.2 Renewal of License

4.0 EXPLOITATION OF LICENSED PRODUCT
4.1 Best Efforts to Sell
4.2 Use of the Prefix "AC"
4.2.1 Notice that "AC" Under License
4.2.2 Standards for use of "AC"
4.2.3 Character and Quality of the Variety
4.2.4 Non Exclusive Rights
4.3 Failure to Meet Demand
4.4 Quality Control

5.0 FEES AND ROYALTIES
5.1 Reimbursement for Registration Fees
5.2 Royalty Percentage Rate
5.3 Minimum Royalty
5.4 Execution Fees
5.5 Sub-Licensing Consideration
5.6 Sub-Licensee's Fees
5.7 Taxes
5.8 Payment to Canada
5.8.1 Time & Mode
5.8.2 Currency & Address
5.8.3 Accompanying Documentation
5.9 Payments to Canada after Termination
5.10 No Set-off

6.0 RECORDS, Quality Control, AUDIT
6.1 Reports & Records
6.1.1 Marketing Efforts and Production
6.1.2 Marketing Conditions
6.1.3 Tonnage Sold / Planted
6.1.4 Sub-License(s) Details
6.2 Canadian Seed Growers Association Records
6.3 Quality Control Obligations
6.4 Quality Control Spot Audits by Canada
6.5 Quality Control Spot Audits on behalf of Canada
6.6 Material terms
6.7 Sales Efforts Audit Rights
6.8 Audit Confidentiality
6.9 No Waiver
6.10 Discrepancy Percentage

7.0 Licensed Product Supply
7.1 Provisions of Seed
7.2 Use of Seed
7.3 Seed for Research and Development
7.4 Seed for Provincial Adaptation Trials
7.5 Improvements

8.0 DISCLAIMERS
8.1 Disclaimer of Express / Implied Warranties
8.2 Disclaimer of Statutorily Implied Warranties
8.3 No Liability to Canada from Exercise of Rights

9.0 CORPORATE REPRESENTATIONS & WARRANTIES
9.1 The Company Incorporated & Authorized & Bound
9.1.1 Ability
9.1.2 Authorization
9.1.3 Incorporation Jurisdiction
9.1.4 Extra-Provincial Registration
9.1.5 Enforceable
9.1.6 Litigation
9.1.7 Veracity Of Statements
9.1.8 Inconsistent Agreements / Obligations
9.1.9 No March In Rights
9.1.10 No Breach of Third Party Agreements
9.2 Canada Authorized
9.2.1 Authorization

10.0 INDEMNITY, INSURANCE and LIABILITY ALLOCATION & CAPS
10.1 The Company's Indemnification
10.2 Indemnity Separate / Continuing
10.3 Insurance
10.4 Canada's Indemnity
10.5 Canada's Liability Cap
10.6 Excluded Heads of Damage
10.7 No Actions Against Employees
10.8 Notifications

11.0 INFRINGEMENT
11.1 Third Party Suit
11.2 Infringement Uncovered
11.3 Company May Sue
11.4 Distribution of Company's Recovery
11.5 Canada May Sue
11.6 Thresholds

12.0 TERMINATION
12.1 By Canada for Cause
12.1.1 No Best Efforts
12.1.2 No Payment
12.1.3 Quality Control & Audit
12.1.4 Ceases Business
12.1.5 Multiple Breaches
12.1.6 Cross-Termination
12.1.7 Criminal Conviction
12.1.8 General Breach
12.1.9 Repudiates
12.1.10 Aggregate Royalty Quantum
12.2 Automatic Termination
12.2.1 Assignment
12.2.2 Bankruptcy
12.3 Termination Not A Penalty
12.4 Procedure
12.5 Effect on Sub-licensees
12.6 The Company's Duties on Termination
12.7 Surviving Obligations

13.0 ALTERNATE DISPUTE RESOLUTION (ADR)
13.1 Negotiations
13.1.1 Informal Negotiations
13.1.2 Formal Negotiations
13.2 Mediation
13.3 Skip Mediation - Direct to Arbitration
13.4 Mediation Process
13.4.1 Appointment Of Mediator
13.4.2 Good Faith Efforts
13.4.3 Empowered Representatives
13.4.4 Costs
13.4.5 Full Disclosure
13.4.6 Location
13.5 Unsuccessful Mediation Remit to Arbitration
13.6 Arbitration - Structure
13.6.1 Forum Laws / Procedural Rules
13.6.2 Number of Arbitrators
13.6.3 Issue before Arbitrator
13.6.4 Applicable Substantive Law
13.6.5 No Equity
13.6.6 Arbitral Interim Orders
13.6.7 Location
13.6.8 Language
13.6.9 Notices
13.6.10 Costs
13.7 Emergencies / Judicial Jurisdiction
13.8 Final & Binding
13.9 Arbitral Decision Deadline
13.10 Power to Settle
13.11 Adjournment to Empower Representative
13.12 Deemed Abandonment
13.13 General ADR Conditions
13.13.1 No Litigation
13.13.2 Obligations During Alternate Dispute Resolution (ADR)
13.13.3 Privilege
13.13.4 Confidentiality
13.13.5 ADR Disclosures Not Admissible in Subsequent Proceedings
13.13.6 Normally Admissible Evidence
13.14 Limitation
13.15 Material Breach

14.0 INTENT AND INTERPRETATION
14.1 Entire Agreement
14.2 No Third Parties
14.3 No Pre-Contractual Inducing Representations
14.4 Due Diligence Search
14.5 Independent Legal Advice
14.6 No Adverse Presumption in Case of Ambiguity
14.7 Severability
14.7.1 Non-Material
14.7.2 Material or fundamental
14.8 Successors and Assigns
14.9 Plurality and Gender
14.10 Not a Joint Venture
14.11 Minister Not Fettered
14.12 Federal Legislation
14.13 Right to Legislate
14.14 Compliance with Law
14.15 No Implied Obligations
14.16 Access to Information
14.17 Forum Conveniens & Applicable Laws
14.18 Attornment
14.19 USA Jury Trial Addendum
14.20 Waiver of Counterclaims
14.21 Due Diligence Audits
14.22 Recitals Accurate
14.23 Force Majeure
14.23.1 Events
14.23.2 Duty to Notify
14.23.3 Commencement of Relief
14.23.4 Termination of Agreement
14.23.5 Postponement of Obligations
14.24 Waiver
14.25 No Estoppel Due to Third Party Practices
14.26 Contract Always Speaks
14.27 Time is of the Essence
14.28 Headings
14.29 Internal References
14.30 Precedence Over Appendices
14.31 Appendices

15.0 LEGAL RIGHTS
15.1 Amendments
15.2 Assignment
15.3 Mode of Assignment / Approval Conditions
15.4 No Consent  Material Breach
15.5 Subcontracting
15.6 No Third Party Rights
15.7 Remedies Cumulative
15.8 Mutual Assistance

16.0 CROWN GENERAL
16.1 No Bribes
16.2 No Share to Members of Parliament
16.3 Public Office Holders

17.0 NOTICE
17.1 Addresses / Contacts
17.2 Deemed Delivery
17.3 Change of Address

18.0 Execution Page
18.1 APPENDIX "A"
18.2 APPENDIX "B"
18.3 APPENDIX "C"

 

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EXCLUSIVE LICENSE AGREEMENT

[technology]

BETWEEN:

HER MAJESTY THE QUEEN IN RIGHT OF CANADA

as represented by the Minister of Agriculture and Agri-Food

("Canada")

AND:

THE COMPANY CANADA INC.,

a company incorporated under the laws of _________,

having its registered office at ___________________ .

("The Company")

INTRODUCTION:

A. WHEREAS Canada is one of the major performers in Canada of agricultural research, including livestock, crop, genetics and land resources research;

B. Whereas AAFC has developed the Variety officially known as.............. of the species (............... );

C. The Variety traits include ;

D. AAFC wishes to make Certified Seed of the Variety widely available in sufficient quantities to meet the needs of Canadian agriculture;

E. AAFC conducted a Request for Proposals in ..............2001 seeking a proponent who gave the overall best value to AAFC in exchange for a sole license for the Sale of the Variety in the Licensed Territory,

F. The Company's proposal was accepted by AAFC for the Variety; and

G. The Parties have incorporated the salient elements of the Company's proposal into this license.

NOW THEREFORE in consideration of the premises, the terms and conditions hereinafter contained and other good and valuable consideration, the receipt of which is hereby acknowledged by each party, the Parties hereto covenant and agree as follows:

 

1.0 DEFINITIONS

1.1 "ADR"

means alternate dispute resolution.

1.2 "Dispute"

for purposes of Article 17 (Alternate Dispute Resolution (ADR)), and paragraph 18.17 (Forum Conveniens)

1.2.1 includes without limitation any controversy, conflict, claim, disagreement or difference of opinion arising out of the License, (irrespective of whether it is premised on contract, tort or trust / equity), including, without limitation, any issues concerning the breach, interpretation, rectification, termination, performance,.enforcement or validity of the License or the rights and liabilities of the Parties in relation to the License;

1.2.2 irrespective of the fact that there is no arguable defence under the License, or that the facts or law are undisputable and subject to judicial summary proceedings;

but Dispute does not encompass any controversy, conflict, claim, disagreement or difference of opinion or the rights and liabilities of the Parties

1.2.3 under any collateral or antecedent agreements independent of the License :; or

1.2.4 with any emanation of Her Majesty the Queen in Right of Canada, other than Agriculture and Agri-Food Canada, Research Branch, ] Research Centre.

1.3 "Execution Date"

means the......day of the month of..........In the year...........;

1.4 "Field of Use"

means the Sale of the Licensed Product and for no other purposes whatsoever.

1.5 "License "

means this agreement that includes attached appendices and future amendments, and refers to the whole of this agreement, not to any particular section or portion thereof.

1.6 "Licensed Product(s)"

means the exercise of the PBR rights as authorized in the License with respect to Pedigreed, Breeder, Select, Foundation, Registered, and Certified Seed of the Variety.

1.7 "Party"

means any one of the signatories to the License and "Parties" means both of them and their respective servants, agents, and employees.

1.8 "PBR"

means Plants Breeders Rights.

1.9 "Pedigreed, Breeder, Select. Foundation, Registered, and Certified Seed"

have the meaning prescribed in the "Regulations and Procedures for the Pedigreed Seed Crop Production", Circular No. 6-94 of the Canadian Seed Growers' Association (CSGA). Grade standards for all classes shall be as defined under Schedule A of Regulations made pursuant to the Seeds Act. For countries where these Regulations do not apply, the equivalent terms and definitions used in those countries shall apply. The purity of Breeder Seed will be at least equivalent to Foundation No. 1 Seed.

1.10"Sale" or "Sell"

means

1.10.1 the multiplication, promotion, marketing, distribution of, or the Sale or offering to Sell, to exchange, to dispose of the Licensed Product;

1.10.2 within the Territory only (without right of export);

1.10.3 within the Field of Use;

1.10.4 for the maximum commercial return to the Company and Canada in accordance with the License.

1.11 "Sales Price"

means the suggested retail market price of certified seed of the Licensed Product(s) as determined by the Company but within the parameters set in the request for proposals.

1.12 "Taxes"

means taxes (including, without limitation, sales taxes, goods & services taxes, value added taxes, however described), levies, imposts, deductions, charges, license and registration fees, assessments, withholdings / withholding taxes and duties imposed by any jurisdiction or authority (including stamp and transaction taxes and duties) together with any related interest, penalties, fines and expenses in connection with them.

1.13 "Term"

means the period prescribed in Article 3 (Term), including any extensions or renewals.

1.14"Territory"

means exclusively in the countries of [ ................... ] without right of export therefrom, always subject to the

1.14.1 United Nations Act, R.S.C. 1985, Chap. U-2;

1.14.2 Export & Import Permits Act, R.S.C. 1985, Chap. E-19;

1.14.3 Special Economic Measures Act, S.C. 1992, Chap. 17,

and any other pertinent Canadian statutory or regulatory strictures. For greater clarity Territory means the aggregate of the countries and jurisdictions cited, and not each country or individual jurisdiction.

 

2.0 GRANT & RESERVATIONS

2.1 Grant:

Subject to both the Company fulfilling the provisions of the License and any third party peremptory rights, Canada grants to the Company a personal, non-transferable, sole, fixed term, revocable, royalty-bearing license for the Sale. Nothing herein shall constitute in any manner whatsoever an assignment or similar transfer of proprietary rights in the Licensed Product to the Company.

2.2 Carve Out

Notwithstanding any other provision of the License, Canada shall retain from the License, any and all absolute and unfettered rights necessary for bona fide research and development and other activities related to the Variety.

2.3 Sublicensing Permitted

The Company is permitted to sub-license non-affiliated or non-controlled Parties on the same terms and conditions of this License. The Company has no right to encumber any contractual, legal or equitable rights the Company may have against any sublicensee in favour of any financial institution or any third party whatsoever.

2.4 Sublicensing Conditions

Any sub-license or any amendment to any sub-license granted by the Company shall:

2.4.1 be royalty-bearing, revocable, without the right to sub-sub-license;

2.4.2 carry a royalty rate no less than that prescribed in the License;

2.4.3 be only within the Territory or any portion thereof,

2.4.4 be only within the Field of Use or a subset thereof;

2.4.5 be subject to the same obligations and restrictions as those required of the Company under the License;

2.4.6 prescribe a royalty of not less than that prescribed in the License;

2.4.7 be in a form determined by the Company but approved by Canada prior to execution;

2.4.8 be copied to Canada immediately following execution; and

2.4.9 not be a de facto assignment.

For greater clarity Canada shall receive from the sub-licensees not less than the same amount of consideration Canada would have received from The Company, had the Company conducted the Sale rather than the sub-licensees. The Company shall ensure that any monies owing to Canada from the sublicensee are paid to Canada when due, and shall be liable for any such monies irrespective of whether or not the sublicensee paid The Company.

2.5 Sub-Licensee Consideration

In addition for the royalties payable by the sub-licensees to Canada as contemplated in paragraph 2.4 (Sub-licensing Conditions), The Company shall also pay to Canada half of the additional consideration paid by the sub-licensees to the Company.

2.6 Termination

Termination of the License shall also terminate any subsisting sub-licenses, but any consideration due or owing to Canada shall be paid promptly thereafter, and any and all unsatisfied obligations and rights shall subsist until satisfied.

2.7 The Company Shall Obtain Regulatory Permissions

The Company shall obtain any registrations, authorizations, permits, certificates or other regulatory permissions which may be required in order for the Company to legally carry out all of its activities under the License, at the Company's sole cost and expense without right of set-off.

2.8 Her Majesty Not Obligated

Nothing in the License shall obligate any emanation of Her Majesty the Queen in Right of Canada to grant any required authorizations, permits, certificates or other regulatory permissions. Conversely there is no implication by the execution of the License that the Company will be granted any required authorization, permits, certificates or other regulatory permissions necessary for the effective Sale of the Licensed Product.

 

3.0 TERM

3.1 Initial Term

The License shall remain in force for five (5) years from April 1, unless terminated pursuant to the provisions of Article 12 (Termination).

3.2 Renewal of License

The License shall be renewed for an additional five (5) year term on the same terms and conditions (excepting renewal) contained herein unless:

3.2.1 the Company is in breach of the License;

3.2.2 the Company is involved in a Dispute with Canada; or

3.2.3 either Party provides sixty (60) days notice as per Article 19 (Notices) prior to the date of expiration, of that Party's unfettered intention to withdraw from the License.

 

4.0 EXPLOITATION OF LICENSED PRODUCT

4.1 Best Efforts to Sell

The Company shall use its best efforts to Sell the Licensed Product(s) to the end-users and sub-licensees. This obligation includes the twin duties of filling demand and creating demand for the Licensed Product(s). Nothing in the License Agreement authorizes the "shelving", deferral of, or otherwise enfeebled sales efforts or other activities which neither create demand nor fill demand for the Licensed Products, and any such activities are a material breach of the License Agreement.

4.2 Use of the Prefix "AC"

Canada retains the right to name the Variety. The Company shall market and advertise the Variety under the Variety's PBR approved denomination name in association with the official mark "AC". The Company shall ensure that the denomination name remains easily recognizable, and cannot be construed as a brand name.

4.2.1 Notice that "AC" Under License

The Company shall give a footnote notice on any material using the "AC" mark that the mark is used under license and with the permission of Canada (i.e. "AC" is an official mark used under license from Agriculture and Agri-Food Canada).

4.2.2 Standards for use of "AC"

The Company acknowledges that it is fundamental importance to Canada that the Company maintain the integrity of the official mark "AC" to a level deemed appropriate by Canada in Her unfettered discretion. The Company shall scrupulously follow any specification and policies issued by Canada concerning the use of "AC".

4.2.3 Character and Quality of the Variety

The Company shall ensure that any sale of the Variety shall comply with all applicable regulatory and contractual standards. In addition to any other rights under the License Agreement, in order to ensure compliance with this and other obligations under the License Agreement, Canada has the right to carry out spot audits and any time at any location without notice, where the Company is selling or delivering the Variety.

4.2.4 Non Exclusive Rights

The Company acknowledges that any rights to the "AC" mark under the License Agreement are non-exclusive, and solely for use in association with the Variety as prescribed hereinbefore.

4.3 Failure to Meet Demand

If the Company is unable, refuses or neglects to create and meet demand for the Licensed Product(s), and does not remedy the situation within 60 days following notification from Canada, then the License shall be deemed to be a non-exclusive License at Canada's written election. Canada shall then have the right to license a third party to Sell the Licensed Product(s). All other terms and conditions of the License shall continue unmodified notwithstanding the conversion to a non-exclusive License.

4.4 Quality Control

Canada shall have the right to inspect the Licensed Product(s) at any time anywhere within the Territory to ensure the Licensed Product(s) satisfies all quality control or other standards, including without limitation shipping, storage and handling requirements pursuant to the federal Seeds Act whether or not the Seeds Act applies.

4.4.1 The Company shall release any Canadian Food Inspection Agency reports on seed quality to Canada immediately upon written notice by Canada.

4.4.2 The Company shall ensure that this provision is in any sub-License and brought to the attention of the sub-Licensee.

These quality control requirements are a material term of this License Agreement.

 

5.0 FEES AND ROYALTIES

5.1 Reimbursement for Registration Fees

The Company shall reimburse Canada within thirty days of written notice, for all third party and registry fees and costs, incurred by Canada for securing or maintaining PBR, patent or any other statutory protections for the Variety, whether incurred before the Execution Date or during the term of the License.

5.2 Royalty Percentage Rate

The Company shall pay to Canada a royalty of five percent (5%) of the Sale Price of Certified Seed of the Variety.

5.3 Minimum Royalty

The Company shall pay the minimum royalty amount in accordance with the following schedule:

5.4 Execution Fees

Within seven (7) days of the Execution Date, the Company shall pay to Canada the one sum of $.......... .

5.5 Sub-Licensing Consideration

The Company shall pay to Canada fifty percent (50%) of all consideration paid by the sub-licensee to the Company above the royalty rate paragraph 5.2 (Royalty Rate) (whether or not such consideration was directly, indirectly or derivatively paid or provided); including without limitation any equity.

5.6 Sub-Licensee's Fees

The Company shall ensure that royalties payable to Canada from sub-licenses shall be remitted directly to the Receiver General for Canada, at the address provided in the Article 17 (Notice). The Company shall take any necessary actions (at The Company's cost) to collect, enforce and remit royalties or other consideration owing to Canada by the sub-licensees. If a licensee has royalties or other consideration owing to Canada under a sub-license for a period in excess of thirty (30) days, then The Company shall pay to Canada that amount owing within the next fourteen (14) days immediately following the aforementioned thirty (30) days.

5.7 Taxes

The Company shall pay Taxes at the applicable prevailing rates exigible on the Company's activities under the License, including any Sales or on the payment of royalties.

5.8 Payment to Canada

The Company shall pay any monies and consideration owing to Canada as follows:

5.8.1 Time & Mode

quarterly, by cheque or money order, commencing on [ .............] 200 and thereafter on [................ ];

5.8.2 Currency & Address

except for royalties generated from Commercialization within Canada, cheques for the payment of royalties shall be in U.S. funds (at the conversion rate stated in the Wall Street Journal on the day the payment is due) and made payable to the "Receiver General for Canada". They shall be sent to:

Director
Agriculture and Agri-Food Canada
Research Centre
[Address]
[Centre/Province]
[Postal Code];

5.8.3 Accompanying Documentation

each cheque shall be accompanied by a statement bearing the Financial Coding of this License and the Licensed Product name/identification, and showing the period covered, the total sales, per country sales, the per country royalty applicable and the total royalty paid or consideration paid, as applicable.

5.9 Payments to Canada after Termination

The Company shall pay to Canada any consideration due and payable under the License, or sub-licenses whether incurred prior to termination or after, in accordance with Article 12 (Termination).

5.10 No Set-off

Notwithstanding any other provision of the License, any consideration payable to Canada by The Company under the License is unconditional and non-cancellable. Further, The Company shall not have the right of set-off, deduct or counter-claim against any such consideration.

 

6.0 RECORDS, Quality Control, AUDIT

6.1 Reports & Records

The Company shall on or before the 31st of December of each calendar year during the Term, submit to Canada written reports as to the Company's activities with respect to the Variety during the twelve (12) month period ending the previous 30th day of November. Such reports shall contain:

6.1.1 Marketing Efforts and Production

a detailed description of the steps taken by the Company to Sell the Variety which description shall have separate entries for seed multiplication or production, indicating the quantities of seed produced in each seed class, making an estimate when precise figures are not available, marketing, sub-licensing and sales;

6.1.2 Marketing Conditions

a description of the marketing conditions for the Variety;

6.1.3 Tonnage Sold / Planted

a statement including the tonnage of the Variety sold or used for planting purposes by the Company, and amount of royalties payable;

6.1.4 Sub-License(s) Details

a statement including the names and addresses of all sub-licenses to whom the Variety has been sub-licensed, a full account of all revenues generated by such sub-licenses, including the number of tonnes of Variety sold, and a calculation of the amount due to Canada for the consideration stipulated therein.

6.2 Canadian Seed Growers Association Records

Canada authorizes the Canadian Seed Growers Association (and any similar organization or institution in other countries as identified by the Company) to disclose to the Company any information it might have with respect to the production of the Licensed Product(s) in the Territory by the Company, including acreage planted.

6.2.1 Canada shall inform the said Association of this contractual obligation upon the written or oral request of the Company.

6.2.2 The Company shall provide all information with respect to the production of the Licensed Product(s) in the Territory, including acreage planted, received from the Canadian Seed Growers Association, to Canada, upon the written or oral request of Canada.

6.2.3 The Company shall ensure that its representatives, contractors, sub-contractors or members (as the case may be) make a full and frank manner disclosure to the Canadian Seed Growers Association all information normally kept by or requested by the Canadian Seed Growers Association.

All costs associated with such disclosure are the responsibility of the Company and shall be paid forthwith by the Company, whether the Company is invoiced by the Canadian Seed Growers Association (and any similar organization or institution in other countries) or Canada.

6.3 Quality Control Obligations

The Company shall comply with all quality requirements for the Licensed Product that are prescribed by:

6.3.1 Canada from time to time in writing; and

6.3.2 any regulatory or statutory authority.

6.4 Quality Control Spot Audits by Canada

The Company shall allow Canada to conduct spot audits of the Company production and sales sites during operating hours anywhere in the Territory to ensure compliance with the prescribed quality standards.

6.5 Quality Control Spot Audits on behalf of Canada

Canada may ask The Company to conduct spot audits of the Company production and sales sites anywhere in the Territory and to disclose those results to Canada within [...... ] days of each audit.

6.6 Material terms

These reporting and quality requirements are a material term of the License.

6.7 Sales Efforts Audit Rights

Upon the written request of Canada, the Company shall permit an independent accountant, retained by Canada to inspect all relevant records (whether held internally by the Company or at the offices of professional advisors or elsewhere) Canada shall have the right to conduct the audit during regular business hours on not less than twenty four (24) hours notice. The audit shall focus on the Company's efforts to, and results in Selling the Licensed Product(s) as well as the accuracy of any reports previously submitted to Canada. This right shall survive for twelve (12) months immediately following the License's termination or expiration.

6.8 Audit Confidentiality

The independent accountants retained by Canada shall inform Canada whether or not the Company has complied with its obligations under the License, including without limitation whether all royalties and consideration due and payable were paid as prescribed to Canada. Subject to the information contained in the foregoing audit reports, the independent accountants shall not reveal to Canada any of the Company's internal documentation or records

6.9 No Waiver

Any royalty payment or report accepted by Canada shall not constitute a waiver by or estoppel against Canada concerning the contractual right to audit The Company, and Canada shall continue to have the right to audit as prescribed in the License. Furthermore, an audit shall not preclude Canada from conducting subsequent audit or audits.

6.10 Discrepancy Percentage

In the event of any discrepancy uncovered by the audit, in excess of [three] 3.0% or $ [............. ] whichever is the lesser, the Company shall pay forthwith to Canada both the discrepancy and the cost of the audit. Any overpayments shall be paid forthwith to the Company.

 

7.0 Licensed Product – Supply

7.1 Provisions of Seed

Canada shall:

7.1.1 provide the Company with .............. (.............. ) Kg of Pedigreed Seed within thirty (30) days of the Execution Date;

7.1.2 provide the Company, at its request, further quantities of Breeder Seed and other classes of Pedigreed Seed that may be available at a fee established by Canada;

7.1.3 maintain a supply of Breeder Seed of the Variety for the Term;

7.1.4 provide the Company, from time to time, with new Breeder Seed or other classes of Pedigreed Seed of the Variety that may be available for a fee established by Canada;

7.1.5 make the Breeder Seed available at the Seed Increase Unit of the Research Farm, Indian Head, Saskatchewan, S0G 2K0, or at such other location as may be designated by Canada. The Company shall obtain the Breeder Seed promptly upon notification from Canada. If the Company wants Canada to deliver the Breeder Seed to the Company's premises, then Canada shall do so at the Company's expense and at the Company's risk.

7.2 Use of Seed

The Company shall only use the seed received from Canada for the production of Pedigreed Seed. It shall not assign, sell, give, or in any manner whatsoever dispose of any of the Breeder, Select, Foundation, or Registered Seed of the Variety received from Canada or produced from seed supplied by Canada without the written permission of Canada except as provided in the License.

7.3 Seed for Research and Development

The Company shall provide Canada or his designate, on the first of March of each calendar year of the License, upon Canada's request and at no cost to Canada, up to fifty (100) kilograms of Certified or higher quality untreated seed for research and development purposes only.

7.4 Seed for Provincial Adaptation Trials

The Company agrees to provide to provincial variety testing agencies seed for provincial adaptation trials, subject to the availability of suitable seed.

7.5 Improvements

Any improvements of any kind or manner whatsoever, including without limitation, reselection, derivative, clonal variant or gene insertion may be the subject of a separate license, if Canada decides to license the improved Variety or derivative, in Canada's unfettered discretion.

 

8.0 DISCLAIMERS

8.1 Disclaimer of Express / Implied Warranties

Canada makes no warranties, representations or conditions, express or implied, of any nature, and Canada disclaims all warranties, representations or conditions, for the Licensed Product including, without limitation:

8.1.1 merchantability;

8.1.2 quality (either as discussed or with respect to a sample);

8.1.3 fitness for any or a particular purpose;

8.1.4 commercial utility or practical purpose;

8.1.5 susceptibility of yielding valuable results or results are free of defects or otherwise harmless;

8.1.6 latent or other defects;

8.1.7 infringement or non-infringement of PBR, Patent or other third party rights;

8.1.8 conformity with the laws of any jurisdictions; or

8.1.9 fitness for the Company's corporate objectives (whether or not expressly or impliedly communicated to Canada).

For greater certainty, no information or advice given by Canada shall create a warranty or representation or condition other than as expressly stated in the License. The Company accepts the Licensed Product "as is", with all faults, and the entire risk as to satisfactory quality, performance, accuracy and effort is with the Company.

8.2 Disclaimer of Statutorily Implied Warranties

No legal or equitable warranties or conditions implied by law or convention under any domestic, foreign or international legal regime, or from a course of dealing or usage of trade, shall apply to the License. The Company acknowledges this disclaimer and is estopped from relying on any such representations, warranties or conditions against Canada.

8.3 No Liability to Canada from Exercise of Rights

The Company agrees to Sell the Licensed Product entirely at its own risk and under its own responsibility. The Company will have no recourse against Canada with respect to any consequences of such action.

 

9.0 CORPORATE REPRESENTATIONS & WARRANTIES

9.1 The Company Incorporated & Authorized & Bound

The Company represents and warrants to Canada that as of the Execution Date:

9.1.1 Ability

it can Sell the Licensed Product, and the Company has the necessary access to funds, resources, knowledge, facilities and personnel to perform its obligations under the License:

9.1.2 Authorization

it is authorized and has the corporate power and authority to negotiate, execute, comply with and satisfy its obligations, without qualification, under the License;

9.1.3 Incorporation Jurisdiction

it has been duly incorporated and organized under the laws of [ ................. ], and is validly existing under the laws of [............ ];

9.1.4 Extra-Provincial Registration

it is duly qualified, licensed or registered to carry on business in the Province

of [ ............... ] and [ ........................ ].

9.1.5 Enforceable

it is bound by the License, upon execution, and the License constitutes a legal, valid and binding obligation on The Company, enforceable against The Company in accordance with the terms of the License, except as those terms may be limited by applicable bankruptcy laws and general principles of equity;

9.1.6 Litigation

it has no knowledge of any legal proceeding or order pending against or, to the knowledge of The Company, threatened against or affecting, The Company or any of its properties or otherwise that could adversely affect or restrict the ability of The Company to consummate fully the transactions contemplated by this License, or that in any manner draws into question the validity of this License;

9.1.7 Veracity Of Statements

no representation or warranty by the Company contained in this License and no statement contained in any certificate, schedule or other instrument furnished to Canada pursuant hereto or in connection with the transactions contemplated hereby, contains any untrue statement of a material fact or omits to state a material fact;

9.1.8 Inconsistent Agreements / Obligations

it has not given any understanding, express or implied, to any third party which would;

9.1.8.1 preclude the Company from fulfilling the Company's obligations under the License; or

9.1.8.2 cause the Company to breach an agreement with a third party;

9.1.9 No March In Rights

it is not subject any "march in" or third party rights, (contractual or statutory, contingent or vested) which would give that third party any rights to the Licensed Product not otherwise explicitly described in the License;

9.1.10 No Breach of Third Party Agreements

it's execution of the License does not contravene its constituent documents or any law, regulation or official directive or any of its obligations or undertakings by which it or any of its assets are bound or cause a limitation on its powers or the powers of its directors to be exceeded;

9.2 Canada Authorized

Canada represents and warrants to The Company as of the Execution Date:

9.2.1 Authorization

Canada has the power and authority to negotiate, execute and comply with the License, subject to all applicable laws and the royal prerogative; and

9.2.1.1 no further action is required by or in respect of any governmental or regulatory authority;

9.2.1.2 to the best of Canada's knowledge the License does not contravene, violate or constitute a breach or default under, any requirement of law applicable to Canada or any contract to which Canada is bound is subject; and

9.2.1.3 the License is legal, binding and enforceable in accordance with its terms.

 

10.0 INDEMNITY, INSURANCE and LIABILITY ALLOCATION & CAPS

10.1 The Company's Indemnification

The Company shall:

10.1.1 indemnify;

10.1.2 save harmless; and

10.1.3 defend at its own costs;

Canada (and her employees, servants and agents),

10.1.4 from and against all claims, demands, losses, penalties, damages, costs, (including reasonable solicitor and own-client costs and expert witness costs), actions, suits or other proceedings whatsoever, whether groundless or otherwise,

10.1.5 brought or prosecuted in any manner which heretofore or hereafter may be made by whomever against Canada or her employees, servants and agents;

10.1.6 however and whenever arising out of, relating to, occasioned by or attributed to,

any acts or conduct (including, without limitation, omissions, misrepresentations, errors and offences) of The Company, its employees, servants, agents, or advisors or sub-licensees (whether by reason of negligence or otherwise) in the performance by the Company of the provisions of the License or any activity undertaken or purported to be undertaken under the authority or pursuant to the terms of the License.

10.2 Indemnity Separate / Continuing

The foregoing indemnity is a continuing obligation, separate and independent from the other obligations of The Company and survives termination of, expiration of, or the acceptance of repudiation of the License. It is not necessary for Canada to incur expense or make payment before enforcing a right of indemnity conferred hereunder.

10.3 Insurance

The Company shall ensure that both the Company and each of its sub-licensees shall obtain and maintain, throughout the term of the Licensor duration of the sub-licenses (as the case may be), comprehensive general liability insurance for any and all claims, actions, liabilities and expenses resulting from the of the Licensed Product, including but not limited to product liability.

10.4 Canada's Indemnity

Canada shall indemnify, save harmless and defend at its own costs the Company (and her employees, servants and agents) for damages to property or death of or injury to any person caused sustained or incurred due to the negligence of Canada. Notwithstanding the foregoing, Canada shall not be required to indemnify The Company hereunder to the extent arising out of or which would not have arisen but for

10.4.1 the negligence, fraud or wilful misconduct on the part of the Company, its employees or agents;

10.4.2 a breach by the Company of its obligations, representations and warranties hereunder; or

10.4.3 an unauthorized assignment by The Company of the License.

10.5 Canada's Liability Cap

Canada's liability for:

10.5.1 breach of the representations, conditions or warranties contained herein or any of the other provisions of the License or any other breach giving rise to liability, including a breach of a condition or fundamental term or fundamental breach or breaches; or

10.5.2 in any other way arising out of or related to the License; or

10.5.3 for any cause of action whatsoever and regardless of the form of action (including breach of contract, trust, strict liability, tort [including negligence and misrepresentation], or any other legal or equitable theory);

shall be limited to the Company's actual direct (immediate and foreseeable at the time of negotiation to both Parties), provable damages in an amount not to exceed in the aggregate a sum equal to or less than the net consideration received by Canada from the Company under paragraph 5.2 (royalty rate) for the time period commencing from the Execution Date up to and including the date of judicial judgement or arbitrator's decision.

10.6 Excluded Heads of Damage

Canada shall not be liable to the Company, its successors, assigns, or sublicenses for damages in respect of:

10.6.1 incidental, indirect, special, punitive, exemplary damages;

10.6.2 any economic loss, consequential damages, relational loss, including but not limited to lost business revenue, lost profits, business interruption, failure to realize expected savings, loss of data, loss of business opportunity suffered by The Company or any claim whatsoever and whenever made against The Company by any other party;

(whether grounded in tort [including negligence], strict liability, contract, trust or otherwise,) even if:

10.6.3 Canada was advised of the possibility of such damages, or

10.6.4 the damages encompassed by subparagraphs 10.6.1 and 10.6.2 were foreseeable by Canada, or

10.6.5 such damages resulted from a fundamental breach of the License.

Further, Canada shall have no duty to warn the Company for matters arising directly or indirectly under the License.

10.7 No Actions Against Employees

The Company acknowledges and estopped from and waives any rights the Company might have to commence and prosecute any action whatsoever, regardless of form or grounds (including without limitation negligence, misrepresentation, fiduciary, deceit ) against any of Canada's employees, servants, agents or officers, arising out of any claimed breach of the License or transactions under the License or negotiations leading to the License, or in any other way related to the License. For greater clarity, The Company's remedies for any breach of or Dispute under the License, lies only against Canada, and only within the aforementioned parameters prescribed by the License.

10.8 Notifications

The indemnified party shall notify the indemnifying party of any claim that falls within the parameters of the respective indemnification obligations as soon as practical. In any case such notice shall be made forthwith upon notice that a claim may be prosecuted or a cause of action exists.

 

11.0 INFRINGEMENT

11.1 Third Party Suit

Subject to Article 10 (Indemnification), in the event of any threatened or actual suit against the Company in consequence of the exercise right and license granted herein, the Company shall promptly inform Canada and the Parties will jointly decide on the steps to be taken in the circumstances.

11.2 Infringement Uncovered

Each Party will notify the other promptly in writing when any infringement is uncovered or suspected.

11.3 Company May Sue

The Company shall have the right to enforce the PBR against any infringement or alleged infringement thereof, and shall at all times keep Canada informed as to the status thereof. Subject to Canada's prior written approval (which will not be unreasonably withheld), the Company may, at its own expense, institute suit against any such infringer or alleged infringer and prosecute such suit in a manner consistent with the terms and provisions hereof. Canada shall reasonably cooperate in any such litigation at Company's expense, and Company shall keep Canada apprised in a timely manner of all litigation activities. In any litigation under this article, the Company shall not have the right to settle or otherwise compromise Canada's position as a licensor or owner of the PBR without Canada's prior written consent.

11.4 Distribution of Company's Recovery

In the event of a recovery by the Company of compensatory damages (i.e. non-punitive damages net of legal fees and out of pocket costs of the action) under paragraph 5.2 for a royalty-bearing Licensed Product, The Company shall pay to Canada the applicable royalty rate on infringing Sales. Infringing Sales shall be determined by, and calculated from, the amount of infringing sales on which the award of compensatory damages is based. With respect to any recovery of punitive damages with respect to royalty bearing products, The Company shall pay to Canada an amount equal to 15% thereof.

11.5 Canada May Sue

If Company elects not to enforce the PBR rights, then the Company shall so notify Canada in writing within six (6) months of receiving notice that an infringement exists, and Canada may, in its sole judgment and at its own expense, take steps to enforce the Patent and control, settle, and defend such suit in a manner consistent with the terms and provisions hereof, and recover for its own account any damages, awards or settlements resulting therefrom.

11.6 Thresholds

The Parties acknowledge that the mere fact of an infringement in a jurisdiction is insufficient to merit enforcement proceedings, unless such infringement in a material and significant way negatively affects Sales.

 

12.0 TERMINATION

12.1 By Canada for Cause

The License, at the option of Canada, without prejudice to any other rights in law of equity held by Canada (including any right of indemnity),may be terminated forthwith by Canada without compensation to the Company if:

12.1.1 No Best Efforts

the Company fails to use its best efforts to Sell the Licensed Product;

12.1.2 No Payment

the Company fails to make any payment provided for herein and does not make such payment within sixty (60) days of the due date irrespective of whether or not a reminder or other notification was send to the Company;

12.1.3 Quality Control & Audit

the Company refuses, neglects or fails to meet quality standards or allow access for quality audit purposes contrary to Article 6 (Records, Quality Control & Audit); or provide or allow the audit of the reports and records as required under Article 6 (Records, Quality Control & Audit);

12.1.4 Ceases Business

the Company ceases to actively carry on business;

12.1.5 Multiple Breaches

the Company breaches three or more provisions of the License within any consecutive twelve (12) month period, notwithstanding that such breaches were subsequently cured.

12.1.6 Cross-Termination

the Company breached a provision of another agreement with Canada that was executed with an AAFC Research Centre, and that breach occurred during the term of the License;

12.1.7 Criminal Conviction

the Company was convicted of a criminal or regulatory offence, the nature of which directly or indirectly affects the ability of the Company to conduct itself under the License, or to Sell the Licensed Product in an effective and timely manner, or otherwise prejudices Sales;

12.1.8 General Breach

the Company commits or permits a breach of any of the other terms and conditions herein contained and does not remedy such breach within sixty (60) days after being required in writing to do so by Canada; and

12.1.9 Repudiates

the Company expressly or implicitly repudiates the License by refusing or threatening to refuse to comply with any of the provisions of the License.

12.1.10 Aggregate Royalty Quantum

the Company has not paid in the aggregate any royalties in excess of the minimum annual payment prescribed under paragraph 5.3 (Minimum Royalty) for three (3) consecutive years.

12.2 Automatic Termination

The License and all rights granted to the Company pursuant to the License shall immediately terminate and revert to Canada by operation of contract, without prejudice to any other rights in law of equity held by Canada (including any right of indemnity) and without compensation to the Company, effective the business day prior to the applicable triggering event, namely if:

12.2.1 Assignment

the Company assigns the License without the prior written consent of Canada, contrary to the provisions of paragraph 15.2 (Assignment); or

12.2.2 Bankruptcy

The Company becomes bankrupt or insolvent or otherwise

12.2.2.1 has a receiving or winding up order made or sought against it;

12.2.2.2 has a meeting proposed or convened, seeking or actually passing a resolution to appoint a trustee or official manager;

12.2.2.3 has a receiver, receiver-manager, liquidator, trustee in bankruptcy, custodian or any other officer with similar powers appointed for The Company or such an order is sought;

12.2.2.4 has any or all of its assets seized or otherwise attached for the benefit of creditors, or

12.2.2.5 proposes or convenes a meeting to seek or passes a resolution for winding up,

12.2.2.6 takes the benefit of any statute, at the time in force, relating to bankrupt or insolvent debtors for the orderly payment of debts;

12.2.2.7 makes a general assignment for the benefit of creditors;

12.2.2.8 submits a proposal or arrangement under any debtor/creditor legislation;

12.2.2.9 is the subject of a petition or files an assignment under the Bankruptcy Act or any successor legislation;

12.2.2.10 does or attempts anything analogous to the aforementioned events or having a substantially similar effect to any of the aforementioned events under the laws of any jurisdiction.

12.3 Termination Not A Penalty

The Company acknowledges, and is estopped from alleging otherwise, that the termination provisions in paragraph 12.1 do not constitute a penalty, and are otherwise fair, just and proportional given the nature of the Parties, their respective mandates and corporate objectives, the allocation of risks under the License; the goals of the Parties, nature of the Licensed Product; and the consequences to Canada if the Company commits the aforementioned breaches.

12.4 Procedure

Termination shall be implemented by a notice effective as of the date stated therein, but termination shall be subject to paragraph 12.6 (The Company's Duties on Termination) and be without prejudice:

12.4.1 to the right of Canada to sue for and recover any royalties or other sums due Canada; and

12.4.2 to the remedy of either Party in respect of any previous breach of the License.

12.5 Effect on Sub-licensees

All sub-licensees shall terminate with the License.

12.6 The Company's Duties on Termination

Upon termination or expiration of the License, the Company shall at its own cost:

12.6.1 return immediately to Canada all Licensed Product;

12.6.2 deliver a detailed statement to Canada of the inventory of the Licensed Product then existing, but not sold by the Company, as of the date of expiration or termination;

12.6.3 provide Canada the right of first refusal to purchase from the Company any Licensed Product inventory at fair market value;

12.6.4 dispose of any remaining Licensed Product inventory as specified by Canada;

12.6.5 pay all costs due under the License either by the Company on its behalf or a sub-licensee, up to and including the termination date, within thirty (30) days of the termination;

12.6.6 pay all costs due under the License, subsequent to the termination, for any Licensed Product sold after termination, within seven (7) days of the liability being incurred;

12.6.7 grant back to Canada any technology rights, clinical or research data arising from the Licensed Product or otherwise under the License; and

12.6.8 assign to Canada (or her nominee) any equities, goodwill, or other rights which The Company has or alleges to have acquired in the Licensed Product or derived in the Selling. The Company shall also execute such further documentation as Canada may reasonably request in order to confirm such assignment.

12.7 Surviving Obligations

All obligations of the Parties which expressly or by their nature survive termination or expiration, shall continue in full force and effect subsequent to and notwithstanding such termination or expiration, until they are satisfied or by their nature expire, including but not limited to indemnification, records, quality control & audit, Royalties.

 

13.0 ALTERNATE DISPUTE RESOLUTION (ADR)

13.1 Negotiations

13.1.1 Informal Negotiations

If a Dispute arises between the Parties, then : within 6 months from when the allegedly aggrieved Party knows or should know of the Dispute, the contact individuals in Article 21 (Notice) shall,

13.1.1.1 contact their counterpart, and attempt bona fide efforts to diligently resolve the Dispute through amicable negotiations;

13.1.1.2 provide full, frank and timely disclosure of all relevant facts, information and documents to facilitate those negotiations;

13.1.1.3 resolve the Dispute within 7 days, failing which;

13.1.1.4 reduce the Dispute to writing, and if the contact persons cannot agree on the wording of the Dispute, both contact persons shall submit to each other their written version of the Dispute.

13.1.2 Formal Negotiations

If the Parties are unable to resolve the Dispute within fourteen (14) calendar days from the receipt by the other Party of the written version of the Dispute, then within the following thirty (30) days the Dispute shall be referred to the Director General of the Western Region (or the Director of the [...... ] Centre), on behalf of Canada, and to the CEO (or directly reporting designate), on behalf of The Company, to negotiate a resolution.

13.1.2.1 These individuals may not delegate, substitute or direct, surrogates for them at these negotiations.

13.1.2.2 These individuals shall meet in person to negotiate and the Parties shall bear their own costs.

13.1.2.3 Unless otherwise agreed, the meetings shall alternate between Company, HQ, and [..... ] (Research Centre), commencing in [..... ] for the first meeting for the first Dispute. There shall be one meeting only per Dispute, which meeting shall not exceed one (1) business day in length.

13.1.2.4 The Parties may bring no more than two consultants to a meeting. The two consultants shall not have a right of audience or otherwise to negotiate the Dispute.

13.2 Mediation

If, within thirty (30) days following the close of the meeting under paragraph 13.1.2 (Formal Negotiations), the Parties have not succeeded in negotiating a resolution, then the Parties shall jointly submit the Dispute to mediation.

13.3 Skip Mediation - Direct to Arbitration

If the Parties cannot agree to jointly submit the Dispute to mediation, then either Party may submit the Dispute to binding arbitration.

13.4 Mediation Process

The Parties shall:

13.4.1 Appointment Of Mediator

appoint a mutually acceptable mediator with sixty (60) days from the close of the formal negotiation meeting under sub-paragraph 13.1.2 (Formal Negotiations);

13.4.2 Good Faith Efforts

participate in good faith in the mediation and negotiations related thereto;

13.4.3 Empowered Representatives

representatives sent to the mediation shall be empowered or have sufficient delegated authority to resolve, compromise, negotiate or settle the Dispute submitted to mediation, without seeking further instructions or approvals from any superiors or committees / corporate structures, unless the nature, seriousness or financial quantum of the Dispute by law or corporate policies or practices requires approval from the respective corporate or government structure. In such event, such approval shall be obtained within five (5) business days of the proffer of any settlement offer;

13.4.4 Costs

bear the costs of the mediation equally, except that each Party shall bear its own personal costs of the mediation; and

13.4.5 Full Disclosure

a full, frank and timely manner all relevant facts, information and documents to facilitate the mediation.

13.4.6 Location

The mediation shall take place in the city that was not the site of the formal negotiations for the Dispute.

13.5 Unsuccessful Mediation - Remit to Arbitration

The Dispute shall be referred to binding arbitration by either or both Parties if the Parties are not successful in resolving the Dispute through mediation.

13.6 Arbitration - Structure

After negotiation (and if applicable, mediation), any subsisting Dispute between the Parties, shall be referred to arbitration by a written submission signed by either Canada or The Company.

13.6.1 Forum Laws / Procedural Rules

The arbitration tribunal shall be governed by the UN Commercial Arbitration Code, referred to in the Commercial Arbitration Act, R.S.C. 1985, c. C-34.6 ("Code") and unless the Parties otherwise agree, the Rules in Appendix D ("Rules").

13.6.2 Number of Arbitrators

The arbitration tribunal shall consist of one arbitrator chosen by the Parties.

13.6.3 Issue before Arbitrator

The scope of the arbitration shall be limited to the resolution of the Dispute submitted to arbitration.

13.6.4 Applicable Substantive Law

The arbitration tribunal shall decide the Dispute (including limitations, set-off claims) in accordance with the laws in force in the Province of [ ] and any applicable federal laws.

13.6.5 No Equity

The arbitration tribunal shall not be authorized to decide ex aequo et bono or as amiable compositeur.

13.6.6 Arbitral Interim Orders

Subject to subparagraph 13.6.5 (no equity) the arbitration tribunal shall have all the powers of a court at law or in equity, including the power to make interim orders, orders of injunction (either mandatory or prohibitory), rectification, expungement and orders for interest. However in no case will the final decision breach the strictures of subparagraph 13.6.5 (no equity).

13.6.7 Location

The proceedings shall take place in the city that was not the site of the mediation (or if there was no mediation, in the city that was not the site of the negotiation meeting), unless the Parties agree otherwise.

13.6.8 Language

The language used in the proceedings shall be English.

13.6.9 Notices

All written communication shall be delivered to the Parties hereto in the manner provided for in Article 17 (Notice).

13.6.10 Costs

The Parties shall equally share the costs of the tribunal's fees and expenses. The Parties shall bear their own costs with one exception. The losing Party shall pay all costs, fees, levies and Taxes arising from and necessitated by the enforcement of the arbitration tribunal's award, including, without limitation, registration enforcement charges or other judicial levies.

13.7 Emergencies / Judicial Jurisdiction

The Parties are not precluded from bringing an application to a Court having jurisdiction for interim or interlocutory relief, in law or in equity, including, without limitation, injunctive relief, if such relief is urgently required to preserve the rights or property of either or both of the Parties, pending the final determination of those rights in a subsequent arbitral proceeding as contemplated in this Article.

13.8 Final & Binding

Subject to the Code, the Parties hereto agree that the award and determination of the arbitration tribunal shall be:

13.8.1 final and binding on both Parties;

13.8.2 without right of appeal;

13.8.3 the exclusive remedy between the Parties, regarding any claims, counterclaims, issues or accountings presented or pled to the arbitration tribunal, and

the judgement upon the award rendered by the arbitration tribunal may be entered in any Court having jurisdiction thereof or having jurisdiction over either of the Parties.

13.9 Arbitral Decision Deadline

The arbitration tribunal retainer shall contain the obligation that the arbitration tribunal render a written decision with reasons within thirty (30) days from the close of the hearing or submission of written argument.

13.9.1 If the facts and law are either too complicated or voluminous to allow a properly considered decision within thirty (30) days, then the decision shall be rendered in not less than one hundred and eighty (180) days, but the arbitrator shall notify the Parties of the longer decision period by not later than the close of final arguments.

13.10 Power to Settle

The Parties' representatives at any arbitration throughout the arbitration shall be empowered or have sufficient delegated authority to resolve, compromise, negotiate or settle the Dispute submitted to arbitration, without seeking further instructions or approvals from any superiors or committees / corporate structures. The representatives shall either be the same persons as in paragraph 13.1.2 ( Formal Negotiations ) or their immediate subordinates.

13.10.1 Notwithstanding the foregoing, if the nature, seriousness or financial quantum of the Dispute in law or corporate policies/practices requires approval from the Board of Directors, or Deputy Minister, as the case may be, then, such approval shall be obtained within five (5) business days of the proffer of any settlement offer.

13.10.2 If applicable, the arbitration tribunal shall withhold its final decision until the Parties have ceased negotiating a settlement.

13.11 Adjournment to Empower Representative

Breach of paragraph 13.10 (Power to Settle, [Duly empowered representative]) shall entitle the other Party to seek an adjournment of the arbitration proceedings, to give the breaching Party time to appoint a duly empowered representative within the thirty (30) days. All costs directly traceable to such delay, including arbitration tribunal costs and the non-breaching Party's costs, shall be paid forthwith by the breaching Party.

13.12 Deemed Abandonment

Failure of the breaching Party to appoint such a representative within the thirty (30) day period shall be deemed a withdrawal or abandonment of the Dispute by the breaching Party and the arbitrator shall render a formal decision, finding in favour of the non-breaching Party.

13.13 General ADR Conditions

13.13.1 No Litigation

If either Party has submitted the Dispute to court, which Dispute should properly have been submitted for resolution by arbitration, then the court filing Party shall discontinue the court proceedings forthwith, upon notice from the other Party, and both Parties shall remit the Dispute to arbitration hereunder.

13.13.2 Obligations During Alternate Dispute Resolution (ADR)

During the progress of ADR, the Parties hereto shall continue to diligently perform their obligations under the License.

13.13.3 Privilege

Neither Party shall be required to disclose documents that are privileged or created in contemplation of litigation. If a Party does disclose such a document during ADR, that disclosure shall not be construed as a waiver of any privilege unless the disclosing Party so elects in writing.

13.13.4 Confidentiality

The Parties shall keep confidential the existence of the proceeding under this article, and any element of the ADR (including, without limitation, all conduct, statements, promises, offers, views, pleadings, briefs, documents, testimonies, identity of witnesses, submissions, awards and opinions, whether oral or written), made in the course of the ADR, except as may be lawfully required in judicial or regulatory proceedings relating to the arbitration or otherwise. Without limiting the generality of the foregoing, and for greater clarity, neither Party may make any publicly accessible statements / publications nor any shareholder or press announcements concerning any element of the ADR beyond the fact of the ADR.

13.13.5 ADR Disclosures Not Admissible in Subsequent Proceedings

Subject to subparagraph 13.13.6 (Normally Admissible Evidence), all conduct, statements, promises, offers, views and opinions, whether oral or written, made in the course of the ADR by either Party, or the mediator or arbitrator, are not discoverable or admissible for any purposes, including impeachment, in any subsequent litigation or other proceedings involving the Parties.

13.13.6 Normally Admissible Evidence

Evidence that would otherwise be discoverable or admissible and was not created for an ADR, is not excluded from discovery or admission solely as a result of its use in the ADR.

13.14 Limitation

All Disputes must be submitted to ADR within one (1) year from the time of the facts giving rise to the Dispute. Failure to submit the Dispute within the one (1) year period means a loss of all rights to submit the Dispute to ADR or litigation.

13.15 Material Breach

The failure, neglect or unwillingness of a Party to use or diligently participate in and prosecute a Dispute through ADR is a material breach of the License.

 

14.0 INTENT AND INTERPRETATION

14.1 Entire Agreement

The License constitutes the entire and exclusive agreement between the Parties pertaining to the Sale of the Licensed Product, and supersedes all prior agreements, conditions, obligations, understandings, and negotiations both written and oral. The License sets forth all obligations, undertakings, conditions, representations and warranties forming part of, or in any way affecting or relating to the Sale of the Licensed Product. The Parties acknowledge that with respect to the Sale of the Licensed Product, there are no agreements, obligations, undertakings, representations or warranties whether collateral, oral or written, between The Company and Canada other than those expressly set out in the License.

14.2 No Third Parties

The License is not intended to confer upon any person other than the Parties, any rights or remedies hereunder.

14.3 No Pre-Contractual Inducing Representations

The License supersedes and revokes all negotiations, arrangements, letters of intent, offers, proposals, brochures, term sheets, representations, memoranda of understandings and information conveyed, whether oral or in writing or electronically, between the Parties, or any other person purporting to represent The Company or Canada. The Parties agree that:

14.3.1 neither has been induced to enter into the License by any representations whatsoever not set expressly forth in the License;

14.3.2 neither has relied on any such representations;

14.3.3 no such representations shall be used in the interpretation or construction of the License; and

14.3.4 no claims (including, without limitation, loss of profits, indirect, incidental, consequential damages and economic loss) arising directly or indirectly, from any such representation, negligent or otherwise, shall accrue in law or equity, or be pursued by The Company, and Canada shall have no liability for any such claims.

14.4 Due Diligence Search

The Company agrees that it has conducted its own due diligence examinations in order to satisfy itself of the full, true and plain disclosure of all facts pertinent to the Licensed Product and all representations made by Canada.

14.5 Independent Legal Advice

It is acknowledged by the Parties that each has had legal advice to the full extent deemed necessary by each Party. Furthermore, the Parties acknowledge that neither acted under any duress in negotiating, drafting and executing the License.

14.6 No Adverse Presumption in Case of Ambiguity

There shall be no presumption that any ambiguity in the License be resolved in favour of either of the Parties. For greater certainty, the contra proferentum rule shall not be applied in any interpretation of the License.

14.7 Severability

If any part of the License is declared or held any or all of invalid, void, or contrary to public policy for any other reason, then:

14.7.1 Non-Material

if the invalid provision is not material or fundamental to the License, the invalid provision shall not affect the validity of the remainder which remainder shall continue if full force and effect and be construed as if the License had been executed without the invalid provision; and

14.7.2 Material or fundamental

if the invalid provision is material or fundamental to the License then the License shall terminate effective the 31 days from either the final judicial judgement or arbitral tribunal award.

14.8 Successors and Assigns

The License will be for the benefit of and be binding upon the heirs, executors, administrators, permitted successors, and permitted assigns of the Company and other legal representatives, as the case may be, of each of the Parties. Every reference in the License to any Party includes the heirs, executors, permitted administrators, permitted successors, and permitted assigns, and other permitted legal representatives of the Party.

14.9 Plurality and Gender

Reference to a Party will be read as if all required changes in the singular and plural and all grammatical changes rendered necessary by gender had been made.

14.10 Not a Joint Venture

The Parties expressly disclaim any intention to create a partnership, joint venture or joint enterprise. The Parties acknowledge and agree that:

14.10.1 nothing contained in the License nor any acts of any Party shall constitute or be deemed to constitute the Parties as partners, joint venturers or principal and agent in any way or for any purpose;

14.10.2 no Party has the authority to act for, or to assume any obligation or responsibility on behalf of any other Party; and

14.10.3 the relationship between the Parties is that of licensor and licensee.

14.11 Minister Not Fettered

Nothing in the License shall derogate or otherwise fetter the ability of Canada to regulate, administer, manage or otherwise deal with agriculture and all attendant matters thereto.

14.12 Federal Legislation

The application to the License of any Federal act or regulation includes any subsequent amendment, revision, substitution, consolidation to that act or regulation, notwithstanding that such amendment, revision or substitution occurred after the execution of the License or may have a retroactive effect.

14.13 Right to Legislate

Nothing in the License shall prohibit, restrict or affect the right or power of the Parliament of Canada to enact any laws whatsoever with respect to any area of law for which the Parliament of Canada has legislative jurisdiction, even if the enactment of any such law affects the License, its interpretation, or the rights, obligations, liabilities, vested or not, accrued or accruing, of the Parties.

14.14 Compliance with Law

The Parties shall comply with all applicable laws, as those laws may be amended, revised, consolidated, substituted, from time to time, even if such amendment, revision, consolidation, substitution derogates prospectively or retroactivity from the Parties' vested or accrued rights, obligations and liabilities under the License.

14.15 No Implied Obligations

No implied terms or obligations of any kind, by or on behalf of either of the Parties, shall arise from anything in the License. The express covenants and agreements herein contained and made by the Parties are the only covenants and agreements upon which any rights against either of the Parties may be founded.

14.16 Access to Information

Notwithstanding any provision to the contrary in the License, The Company acknowledges that Canada is subject to the Access to Information Act, R.S.C. 1985, c.A-1 and related acts, and may be required to release, in whole or in part, the License and any other information or documents in Canada's possession or control relating to the License and the Parties.

14.17 Forum Conveniens & Applicable Laws

Subject to Article 13 (ADR) any Dispute, shall be governed firstly by applicable Canadian Federal laws, and secondly by the laws of the Province of [......] (excluding any conflict of laws, venue or forum non conveniens criteria, or other rules or principles that might refer such construction to laws of another jurisdiction). The Parties expressly exclude from the License:

14.17.1 application of the United Nations Convention on Contracts for the International Sale of Goods; and

14.17.2 any conflict of laws, rules or principles which might refer Disputes to the laws of another jurisdiction;

14.18 Attornment

The License shall be treated in all respect as a [Province], Canada contract. Subject to Article 13 (Alternate Dispute Resolution (ADR)) the Parties irrevocably and unconditionally attorn to and submit to the non-exclusive jurisdiction of the courts of [Province], Canada and all courts competent to hear appeals therefrom with respect to any Dispute now or hereinafter arising under the License. The Parties waive any right each may have has to object to an action being brought in those courts including, without limitation, by claiming that the action has been brought in an inconvenient forum or that those courts do not have jurisdiction.

14.19 USA Jury Trial Addendum

The Company waives any right to a trial by jury of any claim, demand action or caution of action

14.19.1 arising under the License;or

14.19.2 in any way connect with or related or incidental to the dealings of the Parties in respect of the License or any other agreements or the transactions related hereto or thereto in each case whether now existing or hereafter;

14.19.3 whether in contract, tort, equity or otherwise.

The Company agrees and consents that any such claim, demand, action or cause of action shall be decided by a court without a jury. Canada may file an original counterpart of the License with any court as written evidence of the consent of the Parties to the waiver of their right to a trial by jury.

14.20 Waiver of Counterclaims

The Company waives any and all of its rights to interpose any claims, deductions, setoffs or counterclaims of any nature in any Dispute with respect to the License.

14.21 Due Diligence Audits

If in a subsequent transaction a third Party requires to review this License as part of a due diligence chain of title search, The Company hereby authorizes the release of this License subject to deleting any financial or proprietary or other Confidential Information contained herein.

14.22 Recitals Accurate

The Parties acknowledge the truth and accuracy of the recitals and acknowledge that the recitals may be used by a court, mediator or arbitrator to help resolve any Dispute.

14.23 Force Majeure

14.23.1 Events

Subject to making all payments required under the License, neither Party shall be in breach of any of its obligations under the License where the failure to perform or delay in performing any obligation is due, wholly or in part, directly or indirectly to the occurrence of a force majeure event including, without limitation:

14.23.1.1 war, whether declared or not, civil war, revolution, acts of piracy / terrorism, acts of sabotage;

14.23.1.2 natural disasters such as violent or destructive storms, cyclones, earthquakes, tidal waves floods, destruction by lightning;

14.23.1.3 explosions, fires, destruction of machines, factories, and any ind of installation;

14.23.1.4 boycotts, strikes and lock-outs of all kinds, go-slows, occupation of factories and premises, and work stoppages which occur in the enterprise of the Party seeking relief;

14.23.1.5 acts of governmental bodies, agencies, boards, whether lawful or unlawful other than those of the Research Centre.

but does not include:

14.23.1.6 the lack of regulatory or other approvals, licenses, permits and authorizations necessary for the performance of the License which are issued by a public authority of any kind whatsoever for which The Company did not apply for or diligently prosecute;

14.23.1.7 the inability of the affected Party to obtain financing or any other financial inability on the part of either Party to meet its obligations under the License;

14.23.1.8 force majeure events that the affected Party knew or should have reasonably known at the time of negotiating the License were probable or avoidable or the effects of which could be minimized, and the affected Party took no steps to deal with such force majeure events, including without limitation obtaining the appropriate insurance, using updated machinery;

14.23.1.9 the portion of the breach or delay due to the failure of the affected Party to take all necessary reasonable steps to minimize, overcome or control the effects of the force majeure event.

14.23.2 Duty to Notify

The Party affected by a force majeure event as contemplated in paragraph 14.23.1 (Force Majeure - Event) shall:

14.23.2.1 give notice to the other Party of such force majeure and its effects on the affected Party's ability to perform as soon as practicable after the force majeure and its effects upon the affected Party's ability to perform become known to that Party;

14.23.2.2 take all reasonable efforts to correct, compensate or minimize the effect of the force majeure event.

14.23.3 Commencement of Relief

The affected Party shall:

14.23.3.1 be excused of its obligations under the License to the extent necessitated by the force majeure event from the time of the force majeure event or if notice was not given as soon as practical, from the receipt of such notice. Failure to give notice makes the failing Party liable in damages for losses suffered by the other Party which otherwise could have been avoided; and

14.23.3.2 complete or continue performance of its obligations and duties under the License as soon as practical after the cessation, removal, or overcoming of the force majeure event.

14.23.4 Termination of Agreement

If the force majeure event continues in excess of sixty (60) consecutive days, or in the aggregate 60 days over any consecutive 200 days, then at any time thereafter Canada shall have the option to renegotiate the License with The Company. If the Parties are unable to agree to the terms of the proposed amended License within 60 days from the notice to negotiate, then the License shall terminate on the 61^st day.

14.23.5 Postponement of Obligations

Any obligations of a Party under the License shall be postponed automatically to the extent and for the period that the affected Party is prevented from meeting those obligations by reason of any cause beyond its reasonable control (other than lack of funds and applicable regulatory approval). The affected Party shall immediately notify the other Party of the commencement, nature of such cause and probable consequence. The affected Party shall also use its reasonable best efforts to render performance in a timely manner, utilizing all resources reasonably required in the circumstances.

14.24 Waiver

No condoning, excusing, or overlooking by either of the Parties of any default by the other Party, at any time or times, in performing or observing any of the Parties' respective covenants, will operate as a waiver renunciation, surrender, of or otherwise affect the rights of the Parties in respect of any continuing or subsequent default. No waiver of these rights will be inferred from anything done or omitted by the Parties, except by an express waiver in writing.

14.25 No Estoppel Due to Third Party Practices

No custom, practice or usage regarding other Licenses between Canada and other Parties shall preclude at any time the strict enforcement of the License by Canada or The Company.

14.26 Contract Always Speaks

Where a matter or thing is expressed in the present tense, it shall be applied to the circumstances as they arise, so that effect may be given to the License according to its true spirit, intent and meaning.

14.27 Time is of the Essence

Time shall be of the essence in the License with respect to the financial and Sale obligations of the Company.

14.28 Headings

14.28.1 All headings in the License have been inserted as a matter of convenience and for reference only, and in no way define, limit, enlarge, modify, the scope or meaning of the License or any of its provisions.

14.28.2 Nevertheless an arbitrator or judge may use any or all of the table of contents, recitals, and headings when reviewing the covenants, statements, representations & warranties and conditions subsequent to better understand the commercial and legal intent of the License's provisions.

14.29 Internal References

Any reference in the License to an Article, paragraph, sub-paragraph, will mean an Article, paragraph or sub-paragraph of the License, unless otherwise expressly provided.

14.30 Precedence Over Appendices

If there is a conflict or ambiguity between the License proper and any appendix thereto, the interpretation consistent with Licenseproper(taking into consideration the statements in the recitals and headings) shall prevail and apply, notwithstanding any wording to the contrary in the applicable appendix.

14.31 Appendices

Subject to paragraph 14.30 (Precedent Over Appendices) the documents attached hereto as Appendix "A" to " " form an integral part of this License as fully as if they were set forth herein in extenso, and consist of:

Appendix "A" - Licensed Product

Appendix "B" - Schedule of Payments

Appendix "C" - (Arbitration) Rules.

 

15.0 LEGAL RIGHTS

15.1 Amendments

No modification or waiver of any provision of the License will be inferred from anything done or omitted by either of the Parties, except by an express amendment in writing, duly executed by the Parties in advance.

15.2 Assignment

The License is personal to the Company.

15.3 Mode of Assignment / Approval Conditions

Without derogating from paragraph 15.2 (Assignment), the Company shall not assign (or transfer, sell, encumber, pledge, grant a security interest sub-license or otherwise deal) or permit any such assignment, in whole or in part, of the License or any of its interest, rights or obligations hereunder, whether such assignment takes place by way of:

15.3.1 sale of assets;

15.3.2 sale of shares;

15.3.3 amalgamation, merger or other reorganization of The Company;

15.3.4 merger, transfer, conversion, assignment, redemption, issuance, sale, cancellation, pledge, conversion or other dealings with any securities of The Company;

15.3.5 operation of law;

15.3.6 acquisition by a person or persons acting in concert of a majority interest of the securities of The Company by a person or persons acting in concert who did not hold such a majority interest at the time of the initial public offering (IPO) or at any time after the IPO.

15.3.7 operation of contract; or

15.3.8 otherwise in any manner or structure whatsoever;

without the prior written consent of Canada, which consent subject to subparagraph

15.3.9 will not be unreasonably withheld.

15.3.9 Any consent from Canada shall be contingent and effective only upon receipt by Canada of payment of five percent (5%) of all consideration involved in the assignment, transfer, sale, encumbrance or other transaction.

15.3.10 Consent to any assignment will not be construed as consent to any other assignment.

15.4 No Consent – Material Breach

Failure of The Company to obtain the prior written consent of Canada to any assignment shall be deemed to be a material breach of the License.

15.5 Subcontracting

The Company has the right to subcontract any portion, but not all, of the License, subject to the following:

15.5.1 The Company shall notify Canada in writing of any significant subcontracts or subcontractors who may have an interest in the technology or a collaboration with Canada;

15.5.2 the subcontract cannot be a de facto assignment; and

15.5.3 no rights, obligations, power or control vested in The Company shall be contingently or otherwise transferred to any third party.

15.6 No Third Party Rights

Nothing expressed or implied in the License is intended to, or shall be construed to confer on or give to, any person other than the Parties, any rights or remedies under or by reason of the License.

15.7 Remedies Cumulative

All rights, powers and remedies provided by the License are cumulative with, and not exclusive of, the rights, powers or remedies provided by law independently of the License.

15.8 Mutual Assistance

The Parties will at all times hereafter, upon every reasonable request of the other, make, do, and execute or cause to be procured, made, done, and executed, all such further acts, deeds and assurances for the carrying out of the terms, covenants and agreements of the License, according to the true intent and meaning of the License. These obligations shall continue post termination or expiry until all pre and post termination obligations are satisfied.

 

16.0 CROWN GENERAL

16.1 No Bribes

The Company warrants that no bribe, gift, or other inducement has been paid, given, promised or offered to any Government official or employee for the obtaining of this License.

16.2 No Share to Members of Parliament

Pursuant to the Parliament of Canada Act, R.S.C. 1985, c.P-1, no member of the House of Commons or Senate will be admitted to any share or part of the License or to any benefit arises from the License.

16.3 Public Office Holders

It is a term of this License that no former public Office holder, who is not in compliance with the post employment provisions of the Conflict of Interest and Post-Employment Code for Public Office Holders, shall derive a direct benefit from this License.

 

17.0 NOTICE

17.1 Addresses / Contacts

Wherever in this License it is required or permitted that notice or demand be given, or served by either Party to or on the other Party, such notice or demand will be in writing and will be validly given or sufficiently communicated if hand delivered or forwarded by certified mail, priority post mail, telegram, or facsimile or sent by overnight delivery by a nationally recognized courier as follows:

The addresses for delivery are:

To The Company:

__________________________________
(Name)

__________________________________
(Title)
{Physical Address}
Telephone: ( )
Facsimile: ( )

To Canada:

Director
Agriculture and Agri-Food Canada
Research Centre
[Address]
[City / Province]
[Postal Code]
[Telephone]
[Facsimile]

17.2 Deemed Delivery

Notice will be deemed to have been delivered:

17.2.1 if delivered by hand, upon receipt;

17.2.2 if sent by electronic transmission, forty-eight (48) hours after the time of confirmed transmission, excluding from the calculation weekends and public holidays;

17.2.3 if sent by certified mail, four (4) days after the mailing thereof, provided that if there is a postal strike or other disruption, such notice will be delivered by hand or electronic transmission.

17.3 Change of Address

The Parties may change their respective addresses for delivery by delivering the notice of change of address to the above noted address, in which case the change will take effect 30 days from that delivery.

 

18.0 Execution Page

IN WITNESS WHEREOF this License has been executed by duly authorized representatives of the Parties.

Executed in triplicate and effective this ..........day of .................., 2001 .

 

- FOR HER MAJESTY THE QUEEN IN RIGHT OF CANADA:

__________________________
(Witness)

__________________________
(Signature)

Director
[Centre] Research Centre

 

- FOR THE COMPANY:

__________________________
(Witness)

__________________________
(Signature)

__________________________
(Name in block letters)

__________________________
(Title)

__________________________
(Title)

FINANCIAL CODE:

 

18.1 APPENDIX "A"

Licensed Product

18.2 APPENDIX "B"

Schedule of Payments

18.3 APPENDIX "C"

Arbitration Rules

 

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REPLY TO QUESTIONNAIRE WIPO/GRTKF/IC/Q.2

PRACTICAL GUIDANCE AND LESSONS LEARNED

Question 21: Please share any practical advice that you may have arising out of the drafting, negotiation and conclusion of the contract in question, in particular, any advice relating to the intellectual property aspects of the contract.

Response:
Model Contracts/Clauses: AAFC uses templates for licenses. A template currently used is attached for convenience.

Question 22: Please share any "lessons learned" arising from your work in the field of contractual agreements for access to genetic resources and benefit-sharing.

Response:

NOTE: The royalties for germplasm vary according to the circumstances. The general rule of thumb is the parent is about one third of a potential royalty for the variety, and is lower when it's non-exclusive - generally about one half the exclusive royalty rate. Therefore, if the line was exclusive to the Company, 7 to10 cents per pound of certified seed would be expected in a parent line with hybrid breeding.

Another way of looking at the royalty is 2.5% of retail price of the certified seed sold by the company for an exclusive license to the line (parent).

Royalty rates would also go higher if certain traits are of higher value to the Company. Rates will be somewhat lower when a Company has been involved in a collaborative research agreement to develop the germplasm. Crown IP is always owned by the Crown. The collaborative agreement does not grant the Company ownership of Crown IP. Overall, rates vary according to the circumstances. One has to be careful in stating rates for germplasm unless all the circumstances are factored into the royalty rate.

As a note, sign a confidentiality agreement with the Company before developing the license.

Also, a Material Transfer Agreement may be needed if there is an evaluation required of the line in the Company's breeding program so they can assess the results of crosses with the line.