LICENSEAND COMMERCIALIZATION AGREEMENT

 

(i)

(A)

patents, patent applications, inventions, discoveries, machines, manufacturers, compositions or matter, processes, formulae, designs, methods, techniques, procedures, concepts, developments, technology, new and useful improvements thereof and know-how relating thereto, whether or not patented or patentable, specifically including the Patent Rights (as hereinafter defined);

 

(ii)

all registrations, applications, recordings and other legal protections or rights related to any of the foregoing, and all rights to sue and recover damages and obtain appropriate injunctive relief for past and future infringement, dilution, misappropriation, violation or breach of such rights; and

all improvements to any of the foregoing.

 

 

(a)

United States and foreign patents and patent applications listed in Schedule 1;

 

(b)

United States and foreign patents issued from the applications listed in Schedule 1 and from divisionals and continuations of these applications;

 

(c)

United States continuation-in-part applications and foreign continuation-in-part applications, and the resulting patents, based on the United States and foreign applications listed in Schedule 1;

 

(a)

are manufactured by using a process, or is otherwise covered by, in whole or in part,  the Intellectual Property Rights;

 

(b)

are derived, in whole or in part, from the Intellectual Property Rights; or

 

(c)

are sold, manufactured or used in any country under this Agreement.

 

(a)

License Territory.  The license granted to PARI pursuant to this Section 3.1 extends worldwide.  Notwithstanding the foregoing, both PARI and ALRT acknowledge that the Patent Rights identified on Schedule 1 specifically cover the corresponding country(ies) noted thereon.

 

(b)

Patent Prosecution and Maintenance.

 

(i)

Patent Rights in Protection Countries.  During the term of this Agreement ALRT shall take all steps necessary to apply for, seek issuance of, and maintain during the term of this Agreement, Patent Rights for the Products in the countries set forth in Schedule 2 attached hereto and incorporated by reference herein (the “Protection Countries”); provided, however, that ALRT shall not be required to file for the Patent Rights in the countries

 

listed on Schedule 2 (except for the United States) until the expiration of the Trial Period and PARI has not terminated this Agreement prior to the end of the Trial Period.  Prior to filing for a Patent Right in a country listed on Schedule 2, PARI and ALRT agree to review PARI’s commercialization plan for such country to ensure PARI plans to commercialize.  In the event PARI does not yet have a commercialization plan for the Products in a country listed on Schedule 2, no filing for a Patent Right will then be required in that country.  However, PARI may nevertheless request ALRT to file for a Patent Right without a current commercialization plan, upon which time PARI and ALRT shall split the costs of filing for a Patent Right in that country until such time as PARI finalizes its commercialization plan for that country and ALRT shall then cover all associated costs.  Such filing for a Patent Right will not need to take place immediately, but must proceed in a manner and within a time period to ensure rights are not lost based on priority of related US applications (for example, filing at least a PCT patent application with the US Receiving Office within one year of the filing of the US application and subsequent filing of national applications within 30 months of the filing of the US application).  Following such filings for a Patent Right, PARI shall be responsible for 50% of all maintenance fees related to the Patent Rights in such other countries for the period from the issuance of such Patent Rights in a country listed on Schedule 2 until the commercial launch of the Products by, or on behalf of, PARI in such country.  The prosecution, filing and maintenance of all Patent Rights for Products in the Protection Countries shall be the primary responsibility of ALRT.  ALRT shall keep PARI timely advised with respect to the progress and status of such Patent Rights and shall supply to PARI copies of all material correspondence and papers received in connection therewith.  ALRT shall take all steps to provide such correspondence to and advise PARI in a timely manner in order to permit PARI to comment on all actions before they are taken by patent counsel.  Any additional countries that PARI agrees with ALRT to be included in Schedule 2 in accordance with (b)(ii) below, and the Patent Rights therein, shall be governed by the terms and conditions of this Agreement.  All final decisions with respect to prosecution of the Patent Rights shall be reasonably made by ALRT, taking into account PARI’s comments.  Notwithstanding anything to the contrary in this Agreement, if PARI reasonably believes that ALRT may fail to make any required payments or take any action required for the preparation, filing, prosecution or maintenance of the Patent Rights within a reasonable time, PARI shall provide ALRT with written notice of such deficiency.  If ALRT fails to take the required action within 30 days of the date of such notice, PARI shall have the right to thereafter make any such required payments or take any such required action and ALRT shall promptly reimburse PARI for any costs and expenses incurred with respect to the foregoing.

 

(ii)

Additional Countries.  The parties may, by mutual written agreement, amend Schedule 2 from time to time during the term of this Agreement to add additional countries to the list of Protection Countries as (i) ALRT applies for protection in such additional countries, and (ii) needed by the parties for commercialization of Products.  In the event that PARI proposes that one or more countries be added to the list of Protection Countries in Schedule 2 and ALRT fails or refuses to agree to the addition of the country(ies) proposed by PARI within thirty (30) days of its receipt of such proposal, then PARI shall have the  right to require ALRT to apply for, seek issuance of, and maintain Patent Rights in such country(ies) at PARI’s expense, and ALRT shall promptly comply with the foregoing.  In all cases, the license and rights granted to PARI hereunder shall include the rights to all such additional country(ies).

 

(iii)

Expenses of Patent Rights Prosecution.  Subject to Section 3.1 (ii), during the term of this Agreement ALRT shall pay all fees and costs incurred by ALRT in connection with the Patent Rights, including, without limitation, attorney fees relating to the filing, prosecution, and maintenance of such Patent Rights.  In addition to any other rights or remedies that PARI may have, in the event that ALRT fails to pay for the filing, prosecution or maintenance of such Patent Rights or any portion thereof, or otherwise fails to prosecute the Patent Rights in the United States or in any country included in the Protection Countries, PARI shall have the right, but not the obligation, to do so, and ALRT shall reimburse PARI for all costs and expenses incurred in connection therewith.

 

(a)

Presentations.  Upon PARI’s request from time to time during the Term, a principal officer or a knowledgeable employee of ALRT shall make himself/herself available to make four (4) formal presentations per year concerning the Products, the Intellectual Property Rights and any research findings related thereto at no charge, provided that PARI shall pay all reasonable travel expenses relating thereto that have been pre-approved by PARI prior to such expenses being incurred.  To the extent PARI desires ALRT to make more than four presentations, ALRT shall do so on the same basis provided that if ALRT does not have the staff available for such presentations it may use qualified and knowledgeable consultants and its reasonable out of pocket expenses, including the fees and expenses of such consultants, each of which will require pre-approval from PARI in writing, shall be reimbursed to ALRT by PARI.

 

(b)

Scientific Papers.  ALRT and PARI shall work together concerning any materials that are to be published that relate to the Products or the Intellectual Property Rights.

 

(c)

Miscellaneous.  Upon PARI’s request, from time to time during the term of this Agreement, ALRT shall assist PARI, at PARI’s expense, with any marketing, advertising, or promotional matters that relate to the Products or the Intellectual Property Rights.

 

(a)

With respect to the Connectivity, the CHC Unit and the Software, ALRT shall control all regulatory activities in accordance with this Section 3.10; provided that ALRT shall (v) consult with PARI with respect to the regulatory strategy related to any Product or any component thereof and otherwise keep PARI reasonably involved in good faith discussions with respect to such activities, (w) provide PARI with copies of correspondence received from and to be provided to, regulatory authorities concerning any Product or any component, (x) consider in good faith all reasonable suggestions and comments provided by PARI with respect to such correspondence and other communications with regulatory authorities, and specifically, use best efforts to allow PARI reasonable advance opportunity to comment on those portions of the initial submissions and subsequent amendments with respect to the regulatory approvals related to any Product or any component thereof, (y) use best efforts to respond to all requests for information received from regulatory authorities with respect to any Product or any component thereof in a timely and complete manner, and (z) not voluntarily take any action or fail to take any action which would be reasonably likely to have an adverse effect on the development of any Product and related approvals.  ALRT hereby gives PARI the full right to access, use and reference

 

(and provide PARI with copies of) all regulatory applications and approvals that ALRT obtains, directly or indirectly, with respect to the Connectivity, the CHC Unit and the Software, including, but not limited to, 510(k) approvals.

 

 

(b)

PARI shall control all regulatory activities relating to its medical devices and systems and shall own all regulatory approvals relating to the forgoing.

 

(a)

Implementation.  ALRT agrees to provide personnel, its expertise and the professional, technical and project management services as are necessary to manage the administration and operation of the Software as used in connection with Products, including offering a complete hosting environment for the Software (from servers to backup technology).  All Software shall at all times comply with all applicable laws and regulations, including, but not limited to HIPPA, COPPA and similar requirements. To the extent PARI recommends any modifications to the Software as used in connection with the CHC Unit and/or the Connectivity, ALRT shall use commercially reasonable efforts to implement such recommended modifications.

 

(b)

Product Developments. ALRT shall from time to time provide PARI with such up-to-date information concerning the Software as ALRT has available and as PARI may from time to time reasonably request.

 

(c)

Support and Training. Upon request, ALRT shall make available to PARI (at such time and place as agreed to by the parties) one or more suitably qualified employees of ALRT for training PARI employees in matters relating to the Software, including without limitation installation, support and operation with Products. The duration, location, and other aspects of the training, as well as the number of PARI employees to be trained, shall be determined by mutual agreement.

 

(d)

Maintenance.  ALRT agrees to provide bug-fixes, patches and other updates with respect to the Software for so long as a subscription for Monitoring activated through the physicians and/or patients to whom PARI sells the CHC Unit via the PARI Network endures and otherwise as PARI may from time to time reasonably request.  ALRT shall further correct any errors or defects in the Software that cause it not to operate properly with the Products, as well as any errors or defects in the documentation that render such documentation inaccurate, erroneous or unreliable.

(e)  

Warranty. ALRT shall warrant the operation of the Software, in its original unaltered form, against system failures, error or bugs. This warranty shall include, with respect to system failures, errors or bugs, ALRT using its best efforts to promptly correct any such failures, errors or bugs, to supply the correction in a timely fashion, and to answer all questions that any physician, patient, any person in the PARI Network or PARI may have regarding such failures, errors or bugs.

 

(a)

if the Monitoring services fee charged by ALRT (or its agent) is more than $30 per month per patient (or the equivalent if the Monitoring services fee is based on a different frequency), then, in the case of Option 1, the Individual Subscription Amount shall be 16.67% of the Monitoring services fee, and in the case of Option 2, the Individual Subscription Amount shall be the sum of (i) 10% of the Monitoring services fee plus (ii) $0.50 as long as no reimbursement code for the CHC Unit has been established by a governmental agency; provided, however, that any increase in the Monitoring services fee as a direct result solely of (x) the increased cost of the outsourcing in case of Option 2 in excess of $5.00 or (y) any add-ons to the Services, such as dial-up modems or other disbursements or out-of-pocket expenses of ALRT requested and agreed to by PARI or (y), shall not give right to an increase of the Individual Subscription Amount; and

 

 

(b)

if  the Monitoring services fee charged by ALRT (or its agent) is less than $30 per patient per month (or equivalent if the  Monitoring services fee is based on a different frequency), then the Individual Subscription Amount shall be as set forth in Section 4.2, unless otherwise agreed to by the parties in writing.

 

(i)

number of subscriptions for Monitoring activated through the physicians and/or patients to whom PARI sells the CHC Units via the PARI Network;

 

(ii)

total billing for subscriptions for Monitoring activated through the physicians and/or patients to whom PARI sells the CHC Units via the PARI Network; and

 

(iii)

total payment due.

 

(a)

ALRT is duly authorized to enter into this Agreement and perform its obligations hereunder and the performance of its obligations hereunder does not conflict with or result in a breach of any other agreement to which ALRT, its shareholders, directors or employees is a party;

 

(b)

Schedule 1 sets forth a true, correct and complete list of (i) all of the Intellectual Property Rights related to the Products that have been filed with the United States Patent and Trademark Office, the United States Copyright Office, or any other national or foreign agency administering formal protection for proprietary rights, and (ii) all material unregistered rights related to the Intellectual Property Rights;

 

(c)

ALRT exclusively owns the entire right, title, and interest in and to all of the Intellectual Property Rights relating to the Products free and clear from all encumbrances including, without limitation, the exclusive right to use and license the same.  ALRT further represents and warrants that the Intellectual Property

 

Rights do not infringe or otherwise constitute an unauthorized use of the proprietary rights of any third party;

 

(d)

the Intellectual Property Rights constitute all of the intellectual property necessary to promote, make, have made, use, distribute and sell the Products, on a worldwide basis;

no third party has any right, title or interest in or to any of the Intellectual Property Rights relating to the Products with the sole exceptions of PGB Medical and Aspen;

ALRT has taken commercially reasonable measures to protect the secrecy, confidentiality and value of the trade secrets and know-how included in the Intellectual Property Rights.  ALRT is not nor has it received any notice that it is, in default (or with the giving of notice or lapse of time or both, would be in default) under any license with respect to the Intellectual Property Rights;

neither ALRT nor its Affiliates have never received any Claim alleging that ALRT’s development or use of the Intellectual Property Rights interferes with, infringes, or misappropriates any intellectual property rights of any third party (including any claim that ALRT must license or refrain from using any intellectual property rights of any third party in order to exploit the Connectivity, CHC Unit and/or the Software).

no third party has interfered with, infringed upon, or misappropriated the Intellectual Property Rights and there are no facts which would form a reasonable basis for any claim of such interference, infringement, or misappropriation;

no claim is pending or, to the knowledge of ALRT, threatened which challenges the legality, validity, enforceability, use, or ownership of any Intellectual Property Rights, and there are no facts which would form a reasonable basis for any such claim; and

the exploitation of the Products does not interfere with, infringe upon, or misappropriate, any intellectual property rights of any third party

 

(a)

PARI agrees to be responsible for, and to defend, indemnify, and hold ALRT, and any of its parents, successors, shareholders, officers, directors and Affiliates, harmless against any and all claims, actions, suits, liabilities, demands, expenses (including reasonable attorney fees and disbursements), losses, costs, or damages (collectively, “Claims”) actually incurred by ALRT, and any of its parents, successors, shareholders, officers, directors or Affiliates, whether such Claim exists directly between the parties hereto or relates to a third party, arising out of or in connection with:

 

(i)

the use of the Intellectual Property Rights in a manner that is inconsistent with the terms and conditions of this Agreement;

 

(ii)

any breach of PARI’s obligations hereunder; and

 

(iii)

any breach by PARI of its representations and warranties set forth in Section 7.2.

 

(b)

ALRT agrees to be responsible for, and to defend, indemnify, and hold PARI, and any of its parents, successors, shareholders, officers, directors and Affiliates harmless, against any and all Claims actually incurred by PARI, and any of its parents, successors, shareholders, officers, directors or Affiliates, whether such Claim exists directly between the parties hereto or relates to a third party, arising out of or in connection with:

 

(i)

the use of the Intellectual Property Rights in a manner that is consistent with the terms and conditions of this Agreement;

any breach of ALRT’s obligations hereunder;

any failure of or breach by ALRT of the representations and warranties set forth in Section 7.1.;

any product liability claim relating to the Connectivity, CHC Unit or Software; and

a claim of infringement or misappropriation of the proprietary rights of any third party by ALRT or its Affiliates.

 

(a)

Termination for Cause.  If either PARI or ALRT is in breach of any of its obligations under this Agreement and fails to remedy such breach within thirty (30) days after receipt of written notice thereof from the other party, the party not in breach shall have the option of terminating this Agreement by giving written notice of termination in accordance with Section 10.8.

 

(b)

Termination of Agreement by PARI.  PARI may terminate this Agreement for any reason or no reason (i) at any time during the Trial Period by giving written notice to ALRT, in which case this Agreement shall immediately terminate, and (ii) following the Trial Period, upon not less than ninety (90) days’ written notice to ALRT, in which case this Agreement shall terminate on the 90th day.

 

(a)

PARI’s right to receive or recover and ALRT’s obligation to make payments accrued as of the effective date of termination or as may become due and payable after the effective date of termination as set forth in Article 4 above;

 

(b)

Each party’s indemnification rights and obligations set forth in Article 7 above;

 

(c)

ALRT’s obligation to maintain records hereunder as set forth in Section 4.3 above;

 

(d)

Each party’s obligation to maintain insurance on behalf of the other party hereto.  Such obligation shall extend for so long as a subscription for Monitoring activated through the physicians to whom PARI sells the CHC Unit via the PARI Network endures.

 

(e)

The confidentiality obligation of both parties set forth in Article 9; and

 

(a)

Either party filing a voluntary petition for bankruptcy, reorganization, or an arrangement under any bankruptcy or insolvency law, or an involuntary petition under any such law being filed against a party hereto and not dismissed within ninety (90) days; and

 

(a)

was in recipient’s rightful possession on a non-confidential basis prior to receipt from the disclosing party;

 

(b)

is or becomes, through no fault of the recipient, publicly known;

 

(c)

is furnished to the recipient by a third party without breach of a duty to the disclosing party;

 

(d)

is independently developed by the recipient without access to the disclosing party’s Confidential Information; or

 

(e)

such disclosure is required by applicable law, provided that the recipient shall apply for confidential treatment of this Agreement and/or the proposed disclosure to the fullest extent permitted by law, shall provide the disclosing party a copy of the confidential treatment request far enough in advance of its filing, if reasonably practical, to give the disclosing party a meaningful opportunity to comment thereon, and shall use reasonable efforts to incorporate in such confidential treatment request any reasonable comments of the disclosing party.

 

(a)

Neither ALRT nor PARI shall assign this Agreement or its rights and obligations hereunder to a third party without the other party’s prior written consent; and

 

(b)

Either ALRT or PARI may assign this Agreement, without the other party’s consent, to an Affiliate.

 

(b)

one (1) business day following the date sent when sent by overnight delivery; or

 

(c)

three (3) business days following the date mailed when mailed by registered or certified mail return receipt requested and postage prepaid to the following address:

 

 

 

 

 

US

Medical Reminder Device Suited for Use with Nebulizers

11/351,432

02/10/2006

 

 

 

 

 

US

Medical Reminder Device Suited for Use with Nebulizers

11/351,432

02/10/2006

US

Patient Care Coordination System Including Home Use of

Doc 09041

07/27/2009

Medical Apparatus  (Primarily the Software System, but some

Coverage of connectivity may be possible)

 

 

 

 

 

US

Patient Care Coordination System Including Home Use of

Doc 09041

07/27/2009

Medical Apparatus

Product: Constant Health Companion BOM

Item

Usage

USDe U/P with Scrap

USD Amount

100 ohm (0805)

1

0.00107

0.00107

150 ohm (0805)

2

0.00107

0.00213

680 ohm (0805)

2

0.00107

0.00213

4K7 ohm (0805)

4

0.00107

0.00426

10K ohm (0805)

1

0.00107

0.00107

15K ohm (0805)

1

0.00107

0.00107

39K ohm (0805)

1

0.00107

0.00107

56K ohm (0805)

9

0.00107

0.00959

120K ohm (0805)

2

0.00107

0.00213

270K ohm (0805)

1

0.00107

0.00107

1.8M ohm (0805)

1

0.00107

0.00107

CHIP CAP 20P (0805)

1

0.00386

0.00386

CHIP CAP 820P (0805)

2

0.00386

0.00773

CHIP CAP 0.1uF (0805)

10

0.00386

0.03864

GOLD CAP 0.33F

1

0.47969

0.47969

1N4148

11

0.00799

0.08794

CRYSTAL 32.768KHZ

1

0.04131

0.04131

TRAN. 2222A

1

0.01599

0.01599

TRAN. 3906

2

0.01332

0.02665

TRAN. 3904

2

0.01332

0.02665

BAR43FILM

5

0.04264

0.21320

BU4325F

1

0.09994

0.09994

74HC00N

1

0.09860

0.09860

EEPROM 24LC02

1

0.09194

0.09194

OKI MCU MSM63188A-607 (DICE)

1

0.00000

0.00000

BSI SRAM 32K X 8 (BS62LV256SC)

1

0.88343

0.88343

PCB (OLD VERSION)

1

0.46903

0.46903

DB9 FEMALE CONNECTOR

1

0.17589

0.17589

BATTERY INSULATION RING

1

0.00666

0.00666

T704 STN LCD

1

0.97137

0.97137

TACT SWITCH

3

0.03065

0.09194

RESET KEY

1

0.00933

0.00933

SLIDE SWITCH

1

0.03864

0.03864

CR2032 LITHIUM BATTERY - "SONY"

1

0.17589

0.17589

ZEBRA CONNECTOR

1

0.01865

0.01865

BUZZER 27 MM

1

0.03331

0.03331

TOP CABINET (3 SILKSCREEN)

1

0.20387

0.20387

BOTTOM CABINET

1

0.13724

0.13724

BATTERY DOOR

1

0.03864

0.03864

SLIDE SWITCH HOLDER

1

0.03864

0.03864

SMALL KEY TOP (1 SILKSCREEN)

2

0.06796

0.13591

LARGE KEY TOP (2 SILKSCREEN)

1

0.08661

0.08661

BACK HOOK

1

0.03864

0.03864

BACK BASE

1

0.06662

0.06662

COVER FOR BACK BASE

1

0.03864

0.03864

LENS

1

0.15856

0.15856

BATTERY PLATE +

1

0.01865

0.01865

BATTERY PLATE -

1

0.01732

0.01732

WEIGHT

1

0.02132

0.02132

CUSHION

4

0.00666

0.02665

WIRE

2

0.00187

0.00373

M2 NUT

1

0.00613

0.00613

SCREW 2 X 5.0 PMT

1

0.00693

0.00693

SCREW PA 1.7 x 5 mm

9

0.00133

0.01199

SCREW PB 2 x 6 mm

4

0.00160

0.00640

SCREW PB 2.3 x 4 mm 6.0 HEAD

2

0.00133

0.00266

USB CABLE

1

4.38000

4.38000

BATTERY SEPARATOR SHEET

1

0.01079

0.01079

GIFT BOX for CHC

1

0.29448

0.29448

INSTRUCTION MANUAL (A4, 1C+1C)

1

0.04131

0.04131

TRAY - BOTTOM for CHC

1

0.10793

0.10793

TRAY - TOP for CHC

1

0.10793

0.10793

INNER CARTON for CHC

0.1

0.32379

0.03238

OUTER CARTON for CHC

0.05

0.66624

0.03331

Total

10.21

Material Cost with Scarp

10.21

Manufacturing Cost & Overhead

6.19

Total Cost in USD FOB HK

16.40

(Testing jig and testing time cost not included)

Remarks:

1. Total cost DOES NOT include OKI IC Cost

2. Total cost INCLUDES USB-Serial Adaptor & Cable Cost @ US$4.38

3. CHC Minimum Order Quantity is 4,000pcs