OPTION AGREEMENT

This OPTION AGREEMENT (referred to as “Agreement”) made as of the [Day] of [Month], [Year] (the “Effective Date”), is entered into by and between [Company Name], a [Type of Company] duly organized under the laws of the state of [State of Incorporation], having its principal place of business at [Address] (hereinafter referred to as “COMPANY”), and the Board of Trustees of Southern Illinois University, a body politic and corporate of the State of Illinois, by and on behalf of [SIU Campus], located at [Campus Location] (hereinafter referred to as “UNIVERSITY”).

RECITALS

WHEREAS, UNIVERSITY is the owner of the IP Rights defined below;

WHEREAS, COMPANY is in the business of designing, manufacturing, marketing, and selling products and services related to the Field of Use defined below;

WHEREAS COMPANY desires to obtain an exclusive option to negotiate and acquire a license from UNIVERSITY to the IP Rights; and

WHEREAS UNIVERSITY is willing to grant such an option to the IP Rights upon the terms and conditions contained in this Agreement;

NOW, THEREFORE, in consideration of the premises and the faithful performance of the mutual promises contained in this Agreement, the Parties agree as follows:

ARTICLE 1. DEFINITIONS

1.1	“Affiliate” means an entity that controls, is controlled by or is under common control with a Party. For purposes of this definition, “control” shall mean the possession directly or indirectly, of a majority of the voting power of such entity (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise); provided that such entity shall be deemed an Affiliate only so long as such control continues.

1.2	“Confidential Information” means proprietary information, know-how and other information disclosed by one Party, or by any Affiliates of a Party, to the other Party pursuant to its rights or obligations under this Agreement. In order to be deemed confidential, Confidential Information must be supplied to the other Party in written form and identified as being confidential or, if disclosed orally, shall be confirmed in writing within forty-five (45) days of its oral disclosure, provided, however, that failure to do so shall not constitute a designation of non-confidentiality, particularly when the confidential nature is apparent from the context and subject matter, all of which a reasonable person would conclude is proprietary and confidential in nature. Confidential Information includes, but is not limited to, information and correspondence relating to the Patent Rights received from UNIVERSITY or UNIVERSITY's patent counsel and all Technology Rights.

1.3	“Field of Use” means any and all fields covered by the IP Rights.

1.4	“Improvement” means any new, improved or modified product, method or process conceived, invented, or developed by UNIVERSITY or its employees during the course of research and relating to the Field of Use.

1.5	“IP Rights” means Patent Rights and Technology Rights.

1.6	“Licensed Products” means products or portions of a product manufactured, caused to be manufactured, sold, offered for sale, used, imported, or exported by COMPANY, that but for the license granted herein would infringe a Valid Claim of the Patent Rights by virtue of such manufacture, caused manufacture, sale, offer for sale, use, importation or exportation.

1.7	“Licensed Services” means any and all services performed for consideration by or for COMPANY and/or an Affiliate of COMPANY which employs a Licensed Product in their performance.

1.8	“Parties” means both COMPANY and UNIVERSITY, and the term “Party” shall mean either of them.

1.9	“Patent Rights” means United States Patent No. [Patent Numbers], as well as any reissues, reexaminations, extensions, divisions, continuations, continuations-in-part and foreign counterparts of any of the foregoing, and any patented Improvements thereto. A list of patents comprising the Patent Rights as of the Effective Date is attached hereto as Exhibit A.

1.10	“Technology Rights” means all unpatented products, methods, inventions, innovations, know-how, discoveries, designs, techniques and/or improvement otherwise conceived in whole or in part by UNIVERSITY or its employees, including without limitation [UNIVERSITY Inventor(s)] or a person working under their joint or individual direction, in the course of conducting research in the Field of Use while employed by UNIVERSITY.

1.11	“Territory” means worldwide.

1.12	“Third Party” means any person or entity other than the Parties, or an Affiliate of the Parties.

1.13	“Valid Claim” means: (i) a claim of an issued and unexpired patent within the Patent Rights which has not been held unpatentable, invalid or unenforceable by a court or other government agency of competent jurisdiction and has not been admitted to be invalid or unenforceable through reissue, re-examination, disclaimer or otherwise; or (ii) a claim of a pending patent application within the Patent Rights being prosecuted in good faith that has not been abandoned or finally rejected.

ARTICLE 2. GRANT OF OPTION

2.1	Option Grant. UNIVERSITY hereby grants COMPANY an exclusive option to acquire an exclusive license to the IP Rights in the Territory within the Field of Use. During the Term of this Agreement, UNIVERSITY shall not offer IP Rights to any Third Party. Subject to all applicable law and subject to UNIVERSITY’s written approval, which shall not be unreasonably withheld, the exclusive license contemplated pursuant to this Article 2.1 shall include the right to sublicense such IP Rights to any Third Party and is contemplated to contain terms substantially similar to those included in Exhibit B. [Note: the highlighted portion may be deleted for licenses that will include worldwide rights in all fields.]

2.2	Exercise of Option. COMPANY may exercise its option at any time during the Term of this Agreement by notifying UNIVERSITY in writing of its intent to exercise this option.

2.3	Restrictions on Other Grants. COMPANY understands that the Patent Rights have been developed in whole or in part through funding from the United States Government and that the Government has certain rights in the Patent Rights. This Agreement and any license contemplated hereunder are subject to any rights the Government has under such funding. [Note: This entire section should be deleted if there is no applicable government funding.]

ARTICLE 3. CONSIDERATION

In consideration for the option granted herein, COMPANY agrees to pay UNIVERSITY [Upfront Amount]. Such payment shall be due within thirty (30) days of the Effective Date of this Agreement and shall be paid in U.S. dollars, by check or other instrument representing immediately available funds payable to “Southern Illinois University”.

ARTICLE 4. IMPROVEMENTS

UNIVERSITY may from time to time make and/or acquire Improvements. Any such Improvements will be promptly disclosed to COMPANY. COMPANY shall have a right of first refusal in unpatented Improvements and patented Improvements for the term of this Agreement. Consideration for intellectual property rights beyond what has been granted above in unpatented Improvements and patented Improvements will be negotiated independently from this Agreement.

ARTICLE 5. REPRESENTATIONS AND WARRANTIES

5.1	UNIVERSITY Representations and Warranties. UNIVERSITY represents and warrants that UNIVERSITY, to the best of UNIVERSITY’s knowledge, is the exclusive owner of the entire right, title and interest in and to the IP Rights subject to any reserved rights outlined in Article 2.3 and that UNIVERSITY has full legal right, authority and power to enter into this Agreement and to grant the exclusive option to COMPANY as set forth herein.

5.2	Limitation of Representations and Warranties. Except as expressly set forth in this Agreement, UNIVERSITY MAKES NO REPRESENTATIONS NOR EXTENDS ANY WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE OF IP RIGHTS WILL NOT INFRINGE ANY PATENT, COPYRIGHT, TRADEMARK, OR OTHER RIGHTS OF THIRD PARTIES.

5.3	COMPANY Representations and Warranties. COMPANY represents and warrants that COMPANY has the full legal right, authority and power to enter into this Agreement.

ARTICLE 6. LIABILITY

6.1	Indemnification. COMPANY agrees to indemnify, hold harmless, and defend UNIVERSITY and its respective trustees, officers, employees, students, and agents against any liability, damage, loss or expense (including reasonable attorneys’ fees and expenses of litigation) arising from any and all claims for death, illness, personal injury, property damage, and improper business practices arising out of the sale or use of Licensed Products by COMPANY and/or its Affiliates or sublicensees, or the performance of Licensed Services by COMPANY and/or its Affiliates or sublicensees whether grounded in tort (including negligence), strict liability, contract or otherwise, except to the extent that such claims for death, illness, personal injury, property damage, or improper business practices arises out of or results from the gross negligence or willful misconduct of UNIVERSITY or its respective trustees, officers, employees, students, and agents, either collectively or individually.

6.2	Insurance. COMPANY shall be required to obtain an appropriate amount of insurance coverage as may be reasonably determined by UNIVERSITY to be necessary to cover all claims, liability, expenses, damages, and costs due to injury to persons or damage to property arising or resulting from IP Rights made, used, sold, or imported worldwide by COMPANY, its Affiliates, or its sublicensees pursuant to this Agreement.

ARTICLE 7. PATENT PROSECUTION AND COST RECOVERY

7.1	Patent Prosecution. UNIVERSITY or its designee will have sole control over the filing, prosecution, and maintenance of any and all patent applications and issued patents in Patent Rights.

7.2	Cost Recovery. COMPANY shall reimburse UNIVERSITY for all reasonable expenses incurred during the term of this Agreement for the preparation, filing, prosecution and maintenance of Patent Rights. If COMPANY fails to reimburse these costs within thirty (30) days of invoicing for these costs, it automatically relinquishes all rights granted under this Agreement.

ARTICLE 8. CONFIDENTIAL INFORMATION

8.1	Confidential Obligations.

8.1.1	Neither Party shall, directly or indirectly, deal with, use, exploit or disclose Confidential Information of the other Party to any person or entity for any purpose except as described or permitted herein or unless and until expressly authorized in writing to do so by the other Party.

8.1.2	Each Party may disclose the Confidential Information only to those employees and agents who shall have a need to know the Confidential Information for the purpose of the activities contemplated by this Agreement. Each Party shall, prior to disclosing the Confidential Information or portion thereof to such designated employees or agents issue appropriate instructions to them to satisfy the obligations herein and obtain their agreement to receive and use the Confidential Information as confidential and subject to non-disclosure on the same conditions as contained herein.

8.2	Exceptions to Obligations. A Party shall not be liable for disclosure of the Confidential Information or any portion thereof upon the occurrence of one or more of the following events:

8.2.1	the Confidential Information or any portion thereof is or becomes publicly available, other than through a breach of this Agreement;

8.2.2	the Confidential Information or any portion thereof is subsequently lawfully obtained by a Party from a Third Party or parties without breach of this Agreement by such Party as shown by documentation sufficient to establish the Third Party as a source of the Confidential Information;

8.2.3	the Confidential Information or any portion thereof was known to a Party prior to its disclosure by the other Party as shown by documentation kept in the ordinary course of business sufficient to establish such knowledge;

8.2.4	a Party has provided its prior written consent for such disclosure;

8.2.5	the Confidential Information is required to be disclosed by law, regulation or legal process; provided that the other Party shall be advised as to the nature of the information to be disclosed prior to such disclosure to enable it to seek a protective order or other appropriate remedy to prevent such disclosure;

8.2.6	the Confidential Information is independently developed by a Party, as shown by written documentation kept in the ordinary course of business.

8.4	Term of Confidential Obligations. The obligations of confidentiality shall survive the expiration or earlier termination of this Agreement for a period of five (5) years.

8.5	Return of Confidential Information. Each Party shall, upon request of the other Party, return all Confidential Information and copies thereof or shall destroy such Confidential Information and copies as directed by a Party; provided that COMPANY may retain a copy of all Confidential Information disclosed to COMPANY pursuant to this Agreement for the duration of this Agreement for archival purposes and UNIVERSITY may retain all Confidential Information disclosed to UNIVERSITY for use outside the Field of Use in perpetuity.

ARTICLE 9. TERM AND TERMINATION

9.1	Term. The Term of this Agreement shall commence on the Effective Date and extend for nine (9) months. Additional time periods may be negotiated between the Parties within a thirty (30) day period from the end of the Term.

9.2	Termination. Notwithstanding any other provisions herein to the contrary, this Agreement may be terminated as follows:

9.2.1	For Breach. In addition to and notwithstanding the termination rights stated elsewhere in this Agreement, this Agreement may be terminated in the event a breaching Party fails to cure a breach of this Agreement within ninety (90) days of its receipt of written notice thereof from the other Party.

9.2.2	Termination for Insolvency of COMPANY. UNIVERSITY may terminate this Agreement immediately upon delivery of written notice to COMPANY: (i) upon the institution by or against COMPANY of insolvency, receivership or bankruptcy proceedings; (ii) upon COMPANY making an assignment for the benefit of creditors; or (iii) upon COMPANY’s dissolution or ceasing to do business.

9.3	Survival. The obligations of Articles 5, 6, 8 and 10 shall survive expiration or termination of this Agreement.

ARTICLE 10. GOVERNING LAW

This Agreement, and any dispute arising thereunder, shall be governed by and construed under the laws of the State of Illinois, without regard to the conflict of laws provisions thereof. The Parties agree that the jurisdiction and venue for any legal controversy arising hereunder shall lie exclusively in a court of competent jurisdiction sitting within the State of Illinois. All claims against SIU arising from this Agreement are subject to the Illinois Court of Claims Act and the exclusive jurisdiction of the Illinois Court of Claims.

ARTICLE 11. NOTICES

11.1	Any notices or communications required or permitted to be given by this Agreement must be (i) given in writing and (ii) personally delivered or mailed, by prepaid, certified mail or overnight courier, or transmitted by facsimile or electronic mail transmission (including PDF), to the Party to whom such notice or communication is directed, to the mailing address or regularly-monitored electronic mail address of such Party as follows:

11.1.1	To UNIVERSITY:	Attention: Director

Office of Technology Transfer

SIU School of Medicine

913 North Rutledge Street

P.O. Box 19631

Springfield, IL 62794-9631

Telephone: (217) 545-8168

Email: rpatino@siumed.edu

11.1.2	To COMPANY:	[Company Contact]

[Company Name]

[Street Address]

[City, State, Zip Code]

Telephone: [Phone Number]

Fax: [Fax Number]

Email: [Email Address]

11.2	Any such notice or communication shall be deemed to have been given on (i) the day such notice or communication is personally delivered, (ii) three (3) days after such notice or communication is mailed by prepaid certified or registered mail, (iii) one (1) working day after such notice or communication is sent by overnight courier, or (iv) the day such notice or communication is faxed or sent electronically, provided that the sender has received a confirmation of such fax or electronic transmission. A Party may, for purposes of this Agreement, change his, her or its address, fax number, email address or the person to whom a notice or other communication is marked to the attention of, by giving notice of such change to the other Party pursuant to this Article. For purposes of this Article a “regularly monitored electronic mail address” shall include the email address provided for each Party hereinabove.

ARTICLE 12. MISCELLANEOUS

12.1	Complete Agreement. This Agreement, including any appendices, exhibits, or schedules hereto, constitutes the entire agreement of the Parties concerning the subject matter hereof and supersedes all prior written and oral agreements, understandings and negotiations with regard to the subject matter hereof.

12.2	Amendment. This Agreement, including this provision, may not be amended except by a written instrument signed by duly authorized representatives of both Parties.

12.3	Partial Invalidity. If any of the provisions of this Agreement shall be found to be invalid or unenforceable, such invalidity or unenforceability shall not invalidate or render unenforceable the entire agreement, but rather the entire Agreement shall be construed as if not containing the particular invalid or unenforceable provision or provisions, and the rights and obligations of the Party shall be construed and enforced accordingly. The Parties agree to negotiate in good faith respecting any term held invalid in an effort to give the most approximate effect intended by the Parties.

12.4	Compliance with Laws. In performing this Agreement, each Party shall comply with all applicable laws and government regulations at all times.

12.4.1	Export Controls. COMPANY agrees to strictly comply, and shall require its Affiliates and sublicensees to strictly comply, with any and all applicable United States export control and trade laws and regulations, including but not limited to the U.S. Department of Commerce’s Export Administration Regulations and the regulations administered by the Office of Foreign Assets Control. COMPANY hereby gives written assurance that it will comply with, and will cause its sublicensees/Affiliates to comply with all United States export control laws and regulations, that it bears sole responsibility for any violation of such laws and regulations by itself or its sublicensees/Affiliates, and that it will indemnify, defend and hold UNIVERSITY harmless for the consequences of any such violation. COMPANY will not disclose export controlled items or information unless and until a plan for the transfer, use, dissemination and control of the items or information has been approved by UNIVERSITY’S Export Control Director.

12.5	Headings. The Article and section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

12.6	Force Majeure. No Party shall be considered in default of performance of its obligations under this Agreement to the extent that performance of such obligations is delayed by force majeure or contingencies or causes beyond the reasonable control of such Party or its suppliers, including but not limited to strike, fire, flood, earthquake, windstorm, governmental acts or orders or restrictions, failure of suppliers, or any other reason to the extent that the failure to perform is beyond the reasonable control and not caused by the negligence or willful misconduct of the non-performing Party.

12.7	Nonassignability and Binding Effect. Neither Party shall assign or transfer this Agreement or any rights or obligations hereunder (whether by operation of law or otherwise) without the prior written consent of the other Party, which consent shall not be unreasonably withheld. Notwithstanding the foregoing, either Party may assign or transfer this Agreement upon thirty (30) day advance written notice to the other Party in connection with: (i) an assignment or transfer of this Agreement by either Party to its Affiliate(s); (ii) the merger of a Party with or into another entity; (iii) the sale of a Party’s stock to a Third Party in a single transaction or a series of related transactions, where that Party’s shareholders immediately prior to such merger or sale do not own at least fifty percent (50%) of the voting stock of the surviving entity after such transaction; or (iv) a transfer of all or substantially all of the assets of a Party pertaining to the IP Rights. Any attempted assignment contrary to the provisions of this Article 12.7 shall be null and void.

12.8	No Waiver. No waiver of any term or condition of this Agreement shall be valid or binding on any Party unless agreed in writing by the Party to be charged with waiver. The failure of any Party to enforce at any time any of the provisions of this Agreement, or the failure to require at any time performance by the other Party of any of the provisions of this Agreement, shall in no way be construed to be a present or future waiver of such provisions, nor in any way affect the right of any Party to enforce each and every such provision thereafter.

12.9	Independent Contractors. The Parties to this Agreement are independent contractors. There is no relationship of agency, partnership, joint venture, employment or franchise between the Parties, and no Party shall have any authority to bind the other Party or incur any obligation on the other Party’s behalf.

12.10	Public Relations and Announcements. Except as otherwise required by law, no Party shall issue a press release or any other published statement that refers to another Party or the other Party’s products without first obtaining the agreement of such other Party as to the form and content of the statement, which approval shall be timely and not unreasonably withheld.

12.11	Counterparts and Electronic Signature. This Agreement may be executed in multiple counterparts by the Parties hereto. All counterparts so executed shall constitute one agreement binding upon all Parties, notwithstanding that all Parties are not signatories to the original or the same counterpart. Each counterpart shall be deemed an original to this Agreement, all of which shall constitute one agreement to be valid as of the date of this Agreement. Documents executed, scanned and transmitted electronically and electronic signatures shall be deemed original signatures for purposes of this Agreement and all matters related thereto, with such scanned and electronic signatures having the same legal effect as original signatures.

IN WITNESS WHEREOF, the undersigned have executed this Agreement effective as of the Effective Date.

[Company Name] (“COMPANY”) By: ________________________________ Name: [Signing Official Name] Title: [Signing Official Title] Date: ____________________________	BOARD OF TRUSTEES OF SOUTHERN ILLINOIS UNIVERSITY (“UNIVERSITY”) By: ________________________________ Name: [Signing Official Name] Title: [Signing Official Title] Date: ____________________________

Exhibit A

Patent Rights

[Patent Application Title]

[Type of Application] Patent Application Serial number: [Serial Number]

Filed: [Filing Date]

[Patent Application Title]

[Type of Application] Patent Application Serial number: [Serial Number]

Filed: [Filing Date]

[Patent Application Title]

[Type of Application] Patent Application Serial number: [Serial Number]

Filed: [Filing Date]

[Patent Title]

Issued Patent number: [Serial Number]

Issued: [Issuance Date]

[Patent Title]

Issued Patent number: [Serial Number]

Issued: [Issuance Date]

[Patent Title]

Issued Patent number: [Serial Number]

Issued: [Issuance Date]

Exhibit B

Proposed Licensing Terms

Exclusivity	[Enter Term Value]
Field of Use	[Enter Term Value]
Reservation of Rights	[Enter Term Value]
Rights in Data	[Enter Term Value]
IP Rights	[Enter Term Value]
Territory	[Enter Term Value]
Sublicensing Rights	[Enter Term Value]
License Transactions	[Enter Term Value]
Upfront Consideration	[Enter Term Value]
Patent Cost Reimbursement	[Enter Term Value]
Royalty Rate	[Enter Term Value]
Equity Consideration	[Enter Term Value]
Minimum Annual Royalty/ Maintenance fee	[Enter Term Value]
Milestones	[Enter Term Value]
Milestone Dates	[Enter Term Value]
Cure Payments	[Enter Term Value]
Cost of Challenging Patent Validity	[Enter Term Value]
Term/duration	[Enter Term Value]
Insurance	[Enter Term Value]