13. TERM, TERMINATION, AND MODIFICATION OF RIGHTS
13.1 This Agreement is effective when signed by all parties, unless the provisions of Paragraph 14.16 are not fulfilled, and shall extend to the expiration of the last to expire of the Licensed Patent Rights unless sooner terminated as provided in this Article 13.
13.2 In the event that the Licensee is in default in the performance of any material obligations under this Agreement, including but not limited to the obligations listed in Paragraph 13.5, and if the default has not been remedied within ninety (90) days after the date of notice in writing of the default, PHS may terminate this Agreement by written notice and pursue outstanding royalties owed through procedures provided by the Federal Debt Collection Act.
13.3 In the event that Licensee becomes insolvent, files a petition in bankruptcy, has such a petition filed against it that is not discharged within ninety (90) days, determines to file a petition in bankruptcy, Licensee shall immediately notify PHS in writing. Furthermore, PHS shall have the right to terminate this Agreement immediately upon Licensee ’s receipt of written notice.
13.4 The Licensee shall have a unilateral right to terminate this Agreement in any country or territory by giving PHS sixty (60) days written notice to that effect.
13.5 PHS shall specifically have the right to terminate or modify, at its option, this Agreement, if PHS determines that the Licensee:
(a) is not executing the Commercial Development Plan submitted with its request for a license and the Licensee cannot otherwise demonstrate to the PHS’ satisfaction that the Licensee has taken, or can be expected to take within a reasonable time, effective steps to achieve Practical Application of the Licensed Products or Licensed Processes;
(b) has not achieved the Benchmarks as may be modified under Paragraph 9.2;
(c) has willfully made a false statement of, or willfully omitted, a material fact in the license application or in any report required by this Agreement;
(d) has committed a material breach of a covenant or agreement contained in this Agreement;
(e) is not keeping Licensed Products or Licensed Processes reasonably available to the public after commercial use commences;
(f) cannot reasonably satisfy unmet health and safety needs; or
(g) cannot reasonably justify a failure to comply with the domestic production requirement of Paragraph 5.2, unless waived.
13.6 In making the determination referenced in Paragraph 13.5, PHS shall take into account the normal course of such commercial development programs conducted with sound and reasonable business practices and judgment and the annual reports submitted by the Licensee under Paragraph 9.2. Prior to invoking termination or modification of this Agreement under Paragraph 13.5, PHS shall give written notice to the Licensee providing the Licensee specific notice of, and a ninety (90) day opportunity to respond to, PHS’ concerns as to the items referenced in 13.5(a)-13.5(g). If the Licensee fails to alleviate the PHS’ concerns as to the items referenced in 13.5(a)-13.5(g) or fails to initiate corrective action to the PHS’ satisfaction, PHS may terminate this Agreement.
13.7 When the public health and safety so require, and after written notice to the Licensee providing the Licensee a sixty (60) day opportunity to respond, PHS shall have the right to require the Licensee to grant sublicenses to responsible applicants, on reasonable terms, in any Licensed Fields of Use under the Licensed Patent Rights, unless the Licensee can reasonably demonstrate that the granting of the sublicense would not materially increase the availability to the public of the subject matter of the Licensed Patent Rights. PHS shall not require the granting of a sublicense unless the responsible applicant has first negotiated in good faith with the Licensee.
13.8 PHS reserves the right according to 35 U.S.C. §209(d)(3) to terminate or modify this Agreement if it is determined that this action is necessary to meet the requirements for public use specified by federal regulations issued after the date of the license and these requirements are not reasonably satisfied by the Licensee.
13.9 Within thirty (30) days of receipt of written notice of the PHS’ unilateral decision to modify or terminate this Agreement, the Licensee may, consistent with the provisions of 37 C.F.R. §404.11, appeal the decision by written submission to the designated PHS official or designee. The decision of the designated PHS official or designee shall be the final agency decision. The Licensee may thereafter exercise any and all administrative or judicial remedies that may be accessible.
13.10 Within ninety (90) days of expiration or termination of this Agreement under this Article 13, a final report shall be submitted by the Licensee. Any royalty payments, including those incurred but not yet paid (such as the full minimum annual royalty), and those related to patent expenses, due to PHS shall become immediately due and payable upon termination or expiration. If terminated under this Article 13, sublicensees may elect to convert their sublicenses to direct licenses with PHSpursuant to Paragraph 4.3. Unless otherwise specifically provided for under this Agreement, upon termination or expiration of this Agreement, the Licensee shall return all Licensed Products or other materials included within the Licensed Patent Rights to PHS or provide PHS with certification of the destruction thereof. The Licensee may not be granted additional PHS licenses if the final reporting requirement is not fulfilled.
14. GENERAL PROVISIONS
14.15 Paragraphs 4.3, 8.1, 9.5-9.7 (in respects of sales carried out prior to termination), 12.1-12.4, 12.5 (in respects of acts carried out prior to termination), 13.9, 13.10, 14.12 and 14.15 of this Agreement shall survive termination of this Agreement.
14.16 14.16 The terms and conditions of this Agreement shall, at PHS’ sole option, be considered by PHS to be withdrawn from Licensee’s consideration and the terms and conditions of this Agreement, and the Agreement itself to be null and void, unless this Agreement is executed by the Licensee and a fully executed original is received by PHS within sixty (60) days from the date of PHS signature found at the Signature Page.