LICENSE AGREEMENT-MASS. INSTITUTE OF TECHNOLOGY

EXHIBIT 10.15



ADDENDUM CSI

"Cardiovascular System Identification"





MASSACHUSETTS INSTITUTE OF TECHNOLOGY



LICENSE AGREEMENT



(EXCLUSIVE)











Date: September 28, 1993

(i)



Vers 11/1/91 LP/:to CardioDynamics lic agt.CSI. 9/28 Patent/Ex Date: September 28, 1993





TABLE OF CONTENTS





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PREAMBLE........................................................1

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1 - DEFINITIONS.................................................1



2 - GRANT.......................................................3



3 - DUE DILIGENCE...............................................5



4 - ROYALTIES...................................................6



5 - REPORTS AND RECORDS.........................................7



6 - PATENT PROSECUTION..........................................8



7 - INFRINGEMENT................................................8



8 - PRODUCT LIABILITY...........................................10



9 - EXPORT CONTROLS.............................................11



10 - NON-USE OF NAMES...........................................11



11 - ASSIGNMENT.................................................11



12 - DISPUTE RESOLUTION.........................................11



13 - TERMINATION................................................12



14 - PAYMENTS, NOTICES..........................................13



15 - MOST FAVORED LICENSEE......................................13



16 - MISCELLANEOUS PROVISIONS...................................14



APPENDIX CSI-A..................................................15



APPENDIX CSI-B..................................................16



APPENDIX CSI-C..................................................17



This Agreement is made and entered into this day of , 199 , (the "Effective Date") by and between MASSACHUSETTS INSTITUTE OF TECHNOLOGY, a corporation duly organized and existing under the laws of the Commonwealth of Massachusetts and having its principal office at 77 Massachusetts Avenue, Cambridge, Massachusetts 02139, U.S.A. (hereinafter referred to as "M.I.T."), and CAMBRIDGE HEART, INC., a corporation duly organized under the laws of Delaware and having its principal office at 645 Madison Avenue, 14th Floor, New York, NY 10022 (hereinafter referred to as "LICENSEE").



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WHEREAS, M.I.T. hereby represents that it is the owner of certain PATENT RIGHTS and IMPROVEMENTS (as both terms are later defined herein) relating to M.I.T. Case No.4227, U.S. Patent 4,777,960, "Method and Apparatus for the Assessment of Autonomic Response by Broad-Band Excitation" by Ronald Berger, Jerome P. Saul, Ming Hui Chen, and Richard J. Cohen; M.I.T. Case No.4738, U.S. Patent 4,930,517, "Method and Apparatus for Physiologic System Identification" by Richard J. Cohen, Marvin Appel, and Ronald Berger; and M.I.T. Case No.4820, U.S. Patent 4,979,110, "Characterizing the Statistical Properties of a Biological Signal" by Richard J. Cohen and Paul Albrecht; and has the right to grant licenses under said PATENT RIGHTS, subject only to a royalty-free, nonexclusive license heretofore granted to the United States Government;



WHEREAS, M.I.T. desires to have the PATENT RIGHTS utilized in the public interest and is willing to grant a license thereunder;



WHEREAS, LICENSEE has represented to M.I.T., to induce M.I.T. to enter into this Agreement, that LICENSEE shall commit itself to a thorough, vigorous and diligent program of exploiting the PATENT RIGHTS so that public utilization shall result therefrom; and



WHEREAS, LICENSEE desires to obtain a license under the PATENT RIGHTS upon the terms and conditions hereinafter set forth.



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





ARTICLE I - DEFINITIONS

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



1.1 "LICENSEE" shall include a related company of CAMBRIDGE HEART, INC., the voting stock of which is directly or indirectly at least fifty percent (50%) owned or controlled by



CAMBRIDGE HEART, INC.



1.2 "PATENT RIGHTS" shall mean all of the following M.I.T. intellectual property:



(a) the United States and foreign patents and/or patent applications

listed in Appendices CS I-A and CS I-B;



(b) United States and foreign patents issued from the applications of (a)

above and from divisionals and continuations of these applications;



(c) claims of U.S. and foreign continuation-in-part applications, and of

the resulting patents, which are directed to subject matter

specifically described in the disclosure of (a) above;



(d) claims of all foreign patent applications, and of the resulting

patents, which are directed to subject matter specifically described

in the United States patents and/or patent applications described in

(a), (b) or (c) above; and



(e) any reissues of patents described in (a), (b), (c) or (d) above;



(f) COPYRIGHTABLE MATERIAL and TANGIBLE PROPERTY listed in Appendix CSI-C,

including:



i) Computer Code



ii) Drawings and Circuit Diagrams







1.3 A "LICENSED PRODUCT" shall mean any product or part thereof which:



(a) is covered in whole or in part by an issued, unexpired claim or a

pending claim contained in IMPROVEMENTS or the PATENT RIGHTS in the

country in which any LICENSED PRODUCT is made, used or sold; and/or



(b) is manufactured by using a process which is covered in whole or in

part by an issued, unexpired claim or a pending claim contained in

IMPROVEMENTS or the PATENT RIGHTS in the country in which any LICENSED

PROCESS is used or in which such product or part thereof is used or





1.4 A "LICENSED PROCESS" shall mean any process which is covered in whole or in part by an issued, unexpired claim or a pending claim contained in IMPROVEMENTS or the PATENT RIGHTS.



1.5 "NET SALES" shall mean LICENSEE's (and its sublicensees') billings for LICENSED PRODUCTS and LICENSED PROCESSES produced hereunder less the sum of the following:



(a) discounts allowed in amounts customary in the trade;



(b) sales, tariff duties and/or use taxes directly imposed and with

reference to particular sales;



(c) outbound transportation prepaid or allowed; and



(d) amounts allowed or credited on returns.



No deductions shall be made for commissions paid to individuals whether they be with independent sales agencies or regularly employed by LICENSEE and on its payroll, or for cost of collections. LICENSED PRODUCTS shall be considered "sold" when billed out or invoiced.



1.6 "TERRITORY" shall be worldwide except for those countries in which LICENSEE was asked to pay the cost of filing, prosecuting and maintaining the PATENT RIGHTS pursuant to Article 6.2, and elected not to pay those costs.



1.7 "FIELD OF USE" shall mean all.



1.8 "PRODUCT AREAS" shall mean: Cardiovascular System Identification.



1.9 "SUBLICENSEE" shall mean a third party sublicensed by LICENSEE to make, have made, use, lease and sell the LICENSED PRODUCT(S) and LICENSED PROCESS(ES).



1.10 "IMPROVEMENTS" shall mean any and all modifications, refinements, etc. dominated by the PATENT RIGHTS claims and conceived or reduced to practice over the next three (3) years by Richard Cohen and his subordinates at M.I.T; provided, however, that any rights to such IMPROVEMENTS granted herein are subject to M.I.T. contractual commitments to third party sponsors of research under which IMPROVEMENTS are made.



1.11 LICENSE AGREEMENTS shall mean "Assessing Myocardial Electrical Stability", "Cardiac Electrical Imaging", "Cardiovascular System Identification", and "Pacing Technology for Prevention of Cardiac Dysrhythmias."



1.12 "EFFECTIVE DATE" shall mean the day on which all four LICENSE AGREEMENTS were executed.



ARTICLE 2 - GRANT

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2.1 M.I.T. hereby grants to LICENSEE the right and license to make, have made, use, lease and sell the LICENSED PRODUCTS and to practice the LICENSED PROCESSES in the TERRITORY for the FIELD OF USE to the end of the term for which the PATENT RIGHTS are granted unless this Agreement shall be sooner terminated according to the terms hereof.



2.2 LICENSEE agrees that LICENSED PRODUCTS leased or sold in the United States shall be manufactured substantially in the United States, as required by 35 U.S.C.204.



2.3 In order to establish a period of exclusivity for LICENSEE, M.I.T. hereby agrees that it shall not grant any other license to make, have made, use, lease and sell LICENSED PRODUCTS or to utilize LICENSED PROCESSES in the TERRITORY for the FIELD OF USE during the period of time commencing with the EFFECTIVE DATE of this Agreement and terminating with the first to occur of:



(a) the expiration of twelve (12) years after the first commercial sale of

a LICENSED PRODUCT; or



(b) the expiration of fifteen (15) years after the EFFECTIVE DATE of this

Agreement; provided, however, that if an application for premarket

approval has been submitted to the FDA for a LICENSED PRODUCT prior to

the expiration of that fifteen (15) year period, then the time spent

by that application in the FDA shall be added to the fifteen (15) year





2.4 At the end of the exclusive period, the license granted hereunder shall become nonexclusive and shall extend to the end of the term or terms for which any PATENT RIGHTS are issued, unless sooner terminated as hereinafter provided. The period of exclusivity may be extended upon the written consent of M.I.T., which consent, subject to LICENSEE's diligent and successful commercialization of the PATENT RIGHTS, shall not unreasonably be withheld.



2.5 M.I.T. reserves the right to practice under the PATENT RIGHTS and to use and distribute to third parties for noncommercial research purposes.



2.6 LICENSEE shall have the right to enter into sublicensing agreements for the rights, privileges and licenses granted hereunder only during the exclusive period of this Agreement. Such sublicenses may extend past the expiration date of the exclusive period of this Agreement, but any exclusivity of such sublicenses shall expire upon the expiration of LICENSEE's exclusivity. Upon any termination of this Agreement, sublicensees' rights shall also terminate, subject to Paragraph 13.6 hereof.



2.7 LICENSEE agrees that any sublicenses granted by it shall provide that the obligations to M.I.T. of Articles 2, 5, 7, 8, 9, 10, 12, 13, and 15 of this Agreement shall be binding upon the sublicensee as if it were a party to this Agreement. LICENSEE further agrees to attach copies of these Articles to sublicense agreements.



2.8 LICENSEE agrees to forward to M.I.T. a copy of any and all sublicense agreements promptly upon execution by the parties.



2.9 LICENSEE shall not receive from sublicensees anything of value in lieu of cash payments in consideration for any sublicense under this Agreement, without the express prior written permission of M.I.T. In the event LICENSEE and M.I.T. agree on a cash equivalent value for the transaction and appropriate royalty payments to M.I.T., M.I.T. shall provide its written consent.



2.10 The license granted hereunder shall not be construed to confer any rights upon LICENSEE by implication, estoppel or otherwise as to any technology not specifically set forth in Appendices CSI-A, CSI-B, and CSI-C hereof.



ARTICLE 3 - DUE DILIGENCE

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3.1 LICENSEE either directly or through its SUBLICENSEES shall use its best efforts to bring one or more LICENSED PRODUCTS or LICENSED PROCESSES to market through an ongoing, thorough, vigorous and diligent program for exploitation of the PATENT RIGHTS and



to continue vigorous, ongoing, active, diligent marketing efforts for one or more LICENSED PRODUCTS or LICENSED PROCESSES throughout the life of this Agreement. Such efforts shall include, but shall not be limited to, conducting clinical trials and evaluations necessary to obtain premarket FDA approval.



3.2 In addition, LICENSEE shall adhere to the following milestones:



(a) LICENSEE shall deliver to M.I.T. on or before three (3) month after

the EFFECTIVE DATE a business plan showing the amount of money, number

and kind of personnel and time budgeted and planned for each phase of

development of the LICENSED PRODUCTS and LICENSED PROCESSES in the

PRODUCT AREA and shall provide similar reports to M.I.T. on or before

December 31 of each year.



(b) LICENSEE shall raise and hold a minimum of Two Million Dollars

($2,000,000) aggregate in investment capital on or before the

EFFECTIVE DATE.



(c) LICENSEE shall have raised a total of Three Million Dollars

($3,000,000) cumulative in investment capital on or before one year

after the EFFECTIVE



(d) LICENSEE and/or SUBLICENSEE shall have developed a working commercial

prototype of a LICENSED PRODUCT and, if needed for commercial sale,

shall have filed an application for premarket FDA approval before six

(6) years after the EFFECTIVE DATE of this License Agreement.



3.3 LICENSEE and/or SUBLICENSEE shall make commercial sales of LICENSED PROCESSES at least according to the following schedule:



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