Exhibit 10.2
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
DEVELOPMENT AND LICENSE AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into as of the
Effective Date by and between OPTICAL SENSORS INCORPORATED, a Delaware
corporation ("Licensor" and sometimes "OSI"), with an address at 0000 Xxxxxx
Xxxxxxxx Xxxxx, Xxxxx X, Xxxxxxxxxxx, Xxxxxxxxx 00000, and NELLCOR PURITAN
XXXXXXX, INC., a Delaware corporation ("Licensee" and sometimes "NPB") and a
division of Tyco Healthcare Group LP, with an address at 0000 Xxxxxxxx Xxxxx,
Xxxxxxxxxx, Xxxxxxxxxx 00000.
RECITALS:
A. Licensor is the exclusive licensee of issued U.S. Patent No.
6,055,447 and U.S. Patent No. 6,216,024 B1, and related patents and applications
owned by the Institute of Critical Care Medicine ("ICCM"), a California
nonprofit corporation, with an address at 0000 Xxxxx Xxxxxxx Xxx, Xxxxxxxx #0,
Xxxx Xxxxxxx, Xxxxxxxxxx 00000, all such patents and applications relating to a
method and device for taking measurements in the alimentary canal region between
the stomach and the mouth, or in the respiratory canal region between the lungs
and face (including mouth and nasal regions) to assess or help assess systemic
hypoperfusion, each as listed in Exhibit A1 attached hereto; and OSI owns other
related patents and pending patent applications, each listed in Exhibit A2
attached hereto (collectively all patent and patent applications in Exhibits A1
and A2 being hereinafter referred to as "Patents" and "Patent Applications").
B. Licensee desires to obtain from Licensor, and Licensor desires to
grant to Licensee, an exclusive, worldwide Field of Use sublicense and license
under the Patent Rights (as defined below), including but not limited to the
Patents and Patent Applications listed in Exhibits A1 and A2, on the terms and
conditions set forth in this Agreement.
C. Licensee desires Licensor to complete development of the Model 3000,
to manufacture the Model 3000, and then transfer such manufacturing capability
to Licensee.
1
D. Licensor desires to retain exclusive, worldwide right and license,
with the right to grant sublicenses, to practice the Patent Rights and to have
made, use, promote, market and sell products in connection with practicing the
Patent Rights that are not covered within the Field of Use.
NOW THEREFORE, in consideration of the foregoing recitals and the
mutual representations, warranties, covenants and agreements contained herein,
the parties hereto agree as follows:
1. Definitions.
a. "Affiliate" as used in this Agreement with respect to a
person or entity means any corporation, company, partnership, joint
venture, entity and/or firm which controls, is controlled by or is
under common control with such person or entity.
b. "Average Selling Price" as used in this Agreement means
with respect to each country (i) the aggregate Net Sales of Sensors
during a particular period sold for use in each country divided by (ii)
the aggregate number of Sensors sold, net of returns, during the same
period for use in each country. Average Selling Price shall be
calculated separately for each country.
c. "Date of First Commercial Sale" shall mean that date on
which an initial transfer by Licensee of a Section 3.a(3)
"manufactured" Model 3000 Sensor and related Instrument is made to a
third party in exchange for value, which Sensor and Instrument shall
constitute "manufactured" product made after an "effective transfer"
from development to manufacturing and after the Section 3.a(3)
milestone has been met.
d. "Effective Date" shall mean the date of complete execution
of this Agreement.
e. "Field Forward Military Applications" means specially
hardened designs or products made to comply with non-civilian
specifications delineated by the U.S. or a
2
foreign military for the detection and monitoring of regional and/or
systemic hypoperfusion of military personnel prior to and during combat
from a location remote from a military critical care unit.
f. "Field of Use" means applications for taking measurements
in the alimentary canal region between the stomach and the mouth, or in
the respiratory canal region between the lungs and face (including
mouth and nasal regions) to assess or help assess systemic
hypoperfusion, and specifically excludes all Field Forward Military
Applications and all other applications not directly related to taking
measurements in the alimentary and respiratory regions referred to
herein to assess or help assess systemic hypoperfusion (e.g.,
measurements for regional tissue perfusion of any internal organ,
appendage, etc.).
g. "Gross Margin" as used in this Agreement means the
difference between Net Sales of Sensors or Instruments and Licensee's
direct cost of manufacturing Sensors or Instruments (i.e., direct
material cost, direct labor cost and manufacturing overhead) or having
third parties manufacture Instruments, as calculated in accordance with
generally accepted accounting principles consistently applied as
utilized by Licensee in its normal financial reporting. Freight costs
for product shipped from OSI to Licensee shall be included in
Licensee's direct cost of manufacturing regardless of Licensee's normal
financial reporting standards. As of the date of this Agreement,
Licensee calculates direct cost of manufacturing for its other products
in accordance with the methodology described in Exhibit B.
h. "ICCM License" shall mean the "patent license agreement"
entered into as of July 20, 1998, between Institute of Critical Care
Medicine and Licensor.
i. "Instrument" as used in this Agreement means any device
which connects to a Sensor and processes signals obtained therefrom to
assess or help assess systemic hypoperfusion, and which is covered by a
validly issued U.S. patent included in the Patent Rights. An Instrument
can comprise a standalone monitor, an OEM board for sale
3
to third parties who make monitors (which monitors shall not be
considered "Instruments", just the OEM boards), and that portion of any
multiparameter monitor dedicated to assessing or helping to assess
systemic hypoperfusion using signals obtained from the alimentary canal
region between the stomach and the mouth, or the respiratory canal
region between the lungs and face (including mouth and nasal regions).
j. "Know-How" shall mean any and all techniques, processes and
apparatus for designing and/or making Instruments and/or Sensors,
including but not limited to the Model 3000 system.
k. "Major Countries" as used in this Agreement means each of
the following geographic territories: United States, Japan, United
Kingdom, France, Germany and Italy.
l. "Model 3000" is a next generation Instrument and Sensor in
development at OSI which constitutes an improvement to a model 2000
Instrument and Sensor previously developed by OSI. The Model 2000 has
been cleared by OSI to market by the U.S. Food and Drug Administration
(FDA).
m. "Net Sales" as used in this Agreement means the amount
actually received by Licensee and its Affiliates from the sale of
Sensors or Instruments, as the case may be, less the sum of the
following deductions where applicable: cash, trade or quantity
discounts, sales, use, tariff, import/export duties or other excise or
similar taxes imposed upon particular sales, transportation and related
insurance charges and allowances or credits to customers because of
rejections or returns, as calculated in accordance with consistently
applied and generally accepted accounting principles as utilized by
Licensee in its normal financial reporting. In the event Sensors or
Instruments are bundled with or included as part of another product (a
"Combined Product"), the amount received by Licensee for the Sensor
and/or Instrument shall be deemed to be that portion of the total
amount received by Licensee for the Combined Product that the cost of
the Sensor and/or Instrument bears to the total cost of the Combined
Product. "Net Sales" shall not include any xxxx-up charged by sales
agents of Licensee which are not Affiliates and shall only
4
include amounts actually received by Licensee as specified herein.
n. "Patent Rights" as used in this Agreement means all right,
title and interest of Licensor and its Affiliates in (i) the Patents;
(ii) any patents that issue on the Patent Applications; (iii) any
patents issuing from any reissues, renewals, extensions, divisionals,
continuations and continuations-in-part of the Patents and Patent
Applications; (iv) any foreign patents corresponding to such patents;
and (v) any patents issuing on any and all improvements, modifications,
enhancements or new ideas developed or conceived by Licensor and/or
ICCM, and their respective Affiliates, and in which Licensor and/or
ICCM retain Field of Use rights in and to, and which is usable in
connection with the Patents and the Patent Applications for use in the
Field of Use.
o. "Sensor" as used in this Agreement means any device which
detects signals either in or around
(1) the alimentary canal between the stomach and the
mouth;
(2) the mouth;
(3) the nasal passages; or
(4) the respiratory region between the lungs and face
(nose/mouth),
to assess or help assess systemic hypoperfusion and that is covered by
a validly issued U.S. patent included in the Patent Rights. Sensors can
be disposable or reusable, and shall not include any part of an
Instrument, which may connect to the Sensor to process electrical or
optical signals from the Sensor.
p. "Supplemental Agreement" means the agreement being executed
contemporaneously herewith by Licensee and ICCM.
5
q. "Supply Agreement" means the supply agreement between
Licensor and Licensee being executed contemporaneously herewith.
r. "Third Party Infringement" shall mean any activity by any
third party that constitutes infringement of any of the Patent Rights.
s. "Year 1" shall extend for one year and shall begin on the
first day of the first calendar quarter after the Date of First
Commercial Sale.
t. "Year 2" shall extend for one year and begin upon
termination of Year 1.
u. "Year 3" shall extend for one year and begin upon
termination of Year 2.
v. "Year 4" shall extend for one year and begin upon
termination of Year 3.
2. License.
x. Xxxxx. Licensor hereby grants to Licensee an exclusive,
worldwide, right and license to practice the Patent Rights and Know-How
in the Field of Use to make, have made, develop, improve, use, promote,
market and sell Sensors and Instruments, including the right to have
third parties manufacture, sell and distribute on behalf of Licensee.
Licensee shall inform Licensor of the identities of third parties that
are selling Instruments or Sensors on behalf of Licensee, and Licensee
shall inform Licensor of the identities of third parties that are
manufacturing Instruments or Sensors on behalf of Licensee. Licensor
hereby reserves the right to practice the Patent Rights to make or have
made Sensors or Instruments in the Field of Use as necessary to perform
under the Supply Agreement to supply Sensors and Instruments
exclusively to Licensee. Licensor hereby reserves all rights to
practice the Patent Rights and the Know-How outside the Field of Use.
6
b. Conversion to Non-Exclusive License. If Licensee elects not
to make Minimum Royalty Payments to Licensor for an entire year as
permitted by Section 3.e, the license granted in Section 2.a may
become, at the option of Licensor, non-exclusive upon sixty (60) days
written notice if the past due Minimum Royalty Payments are not paid
during this sixty (60) day period.
c. Repurchase Rights. If Licensee elects not to make Minimum
Royalty Payments for two (2) consecutive years as permitted by Section
3.e, OSI, on thirty (30) days notice, may purchase back from Licensee
worldwide distribution, development and manufacturing rights for the
sum of two million dollars ($2,000,000) plus fifty percent (50%) of
Licensee's prior year's gross margin on worldwide Sensors and
Instruments. This repurchase right shall expire if not exercised within
six (6) months of Licensee's failure to make Minimum Royalty Payments
for two (2) consecutive years.
3. Payments; Royalties; Fees.
a. Manufacturing Milestone Payments. In the first year after
the Effective Date, Licensee shall pay Licensor the following product
development and manufacturing development milestone payment amounts
(which amounts are not license fees):
(1) Seven hundred fifty thousand dollars ($750,000)
upon complete execution of this Agreement (net ten (10) days).
(2) Five hundred thousand dollars ($500,000) upon
agreement in writing between Licensee and Licensor on detailed
Model 3000 customer functional requirements which are
consistent in detail with Nellcor's product development
process for customer requirements. The parties expect such
requirements to be agreed upon within one (1) month of the
Effective Date. If such agreement cannot be reached within
three (3) months of the Effective Date, Licensee may terminate
this Agreement on thirty (30) days written notice and owe no
additional
7
monies hereunder.
(3) Four hundred thousand dollars ($400,000) net
forty-five (45) days after effectively transferring the design
of the Model 3000 from the Licensor's development organization
to the Licensor's manufacturing operation. An effective
transfer will occur when the Licensor has demonstrated that
its quality system, the product design of the Model 3000, and
the processes involved in its manufacture are in compliance
with the Quality System Regulation (QSR, 21 CFR Part 820).
Evidence of compliance will include ***. An effective transfer
shall require that OSI pass all three audits referenced above,
and successfully demonstrate completion of OSI's QSR
procedure. If the Model 3000 as manufactured by Licensor is
subject to a quality recall, all costs associated with the
recall shall be borne *** percent (***%) by Licensor and ***
percent (***%) by Licensee. Licensee shall be entitled to take
a credit against Minimum Royalty Payments and running
royalties for any Licensor recall costs paid or incurred by
Licensee.
(4) Three hundred fifty thousand dollars ($350,000)
net forty-five (45) days after: the Date of First Commercial
Sale, Licensor has demonstrated to Licensee's reasonable
satisfaction a first pass yield of 95% while meeting the labor
and material costs specified in the Supply Agreement on
standard production lots of probes and monitors (minimum of
1,000 probes and 100 monitors required), Licensor obtains U.S.
clearance to market or documentation satisfying FDA letter to
file requirements, and Licensor has transferred all Know-How
associated with such Model 3000 manufacturing to Licensee.
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
8
b. License Percentage Royalty to ICCM. Licensee shall pay to
ICCM, on behalf of Licensor, a royalty on Net Sales of any Sensors and
Instruments sold by Licensee equal to the amounts owed by OSI under
Section 3(a) of the ICCM License.
c. Percentage Royalty to Licensor in Patented Countries.
Subject to royalty amounts being reduced as provided by subsection 3.d,
in Year 1 Licensee shall pay to Licensor a royalty on Net Sales of any
Sensors sold by Licensee equal to *** percent (***%) of Net Sales of
Sensors minus all amounts payable by Licensee to ICCM for Sensors under
Section 3.b. In Year 2 and thereafter, Licensee shall pay to Licensor a
royalty on Net Sales of any Sensors sold by Licensee equal to the
percentage set forth below (minus all amounts payable by Licensee to
ICCM for Sensors under Section 3.b) which is dependent on Licensee's
gross margin.
Nellcor Sensor Gross Margin %, before Licensor Royalty %
payment of Royalties to Licensor and ICCM on Sensors
----------------------------------------- ----------
***% + ***%
***% ***%
***% ***%
***% ***%
***% ***%
***% ***%
***% ***%
***% ***%
***% ***%
***% ***%
***% ***%
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
9
***% ***%
***% ***%
***% ***%
***% ***%
***% or less ***%
Subject to royalty amounts being reduced as provided by subsection 3.d,
royalties payable with respect to Net Sales of Sensors shall be
calculated separately for each country based on the Average Selling
Price in each country. Subject to royalty amounts being reduced as
provided by subsection 3.d, Licensee shall pay to Licensor a royalty on
Net Sales of any Instruments sold by Licensee equal to *** percent
(***%) of the aggregate Gross Margin with respect to Instruments that
are sold by Licensee minus all amounts payable by Licensee to ICCM for
Instruments under Section 3.b. Royalties under this Section 3.c shall
by payable with respect to sales of Sensors and related Instruments
only if a valid patent (or an application is pending as provided in
subsection 3.d), included in the Patent Rights with claims covering the
Sensor or Instruments, as the case may be, has issued (or is pending),
and is in force in the country where the sales occur, prior to the date
of sale.
d. Percentage Royalty to Licensor in Non-Patented Countries.
For sales of Sensors and Instruments in countries in which a valid
patent, included in the Patent Rights, with claims covering the Sensor
or Instruments, as the case may be, has not issued prior to the date of
sale, royalties to Licensor, but not ICCM, shall be *** those set forth
in Section 3.c. However, Licensor may file patent applications in
non-patented countries, and if it does so, Licensee shall pay Licensor
full royalties as defined in Section 3.c (rather than *** royalties) on
Net Sales in those countries where the application is pending, so long
as the Sensor or Instrument, as the case may be, is covered
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
10
by enforceable issued claims in a corresponding U.S. case. If, for some
reason, the application(s) never issues as a patent in a reasonable
period of time with claims covering the Sensor or Instruments, as the
case may be, in the non-patented country(ies), Licensee shall deduct
the *** percent (***%) overpayment, if any, in royalties for that
country from future royalty, minimum and/or milestone payments.
e. Minimum Royalty. Notwithstanding Sections 3.a-3.d, Licensee
shall pay to Licensor, or its designee, a minimum royalty equal to:
Year Minimum Royalty
---- ---------------
Year 2 $***
Year 3 $***
Year 4 $***
(hereinafter, "Minimum Royalty Payment"). Prior to October 1, 2003,
minimum royalties payable by Licensee during any year shall first be
paid by Licensee to ICCM on behalf of Licensor to fulfill Licensor's
minimum royalty payment obligation to ICCM under Section 3(b) of the
ICCM License, with any remainder then being paid to OSI. Minimum
royalties shall be paid in equal quarterly installments within
forty-five (45) days of the end of each calendar quarter, beginning
with the first calendar quarter of Year 2; provided that any royalties
paid pursuant to Sections 3.b-3.d with respect to Net Sales received or
Gross Margins earned by Licensee for any minimum royalty year shall be
applied as a credit against the Minimum Royalty Payment for such year.
Licensee may elect to stop making Minimum Royalty Payments. If Licensee
makes such election for an entire year, Licensor shall have the right
to convert the license granted to Licensee to a non-exclusive license
pursuant to Section 2.b, and if such election extends over two (2)
years Licensor shall have the right to repurchase the license rights
pursuant to Section 2.c.
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
11
f. Payments. All royalties payable to Licensor and ICCM under
this Agreement shall be paid within forty-five (45) days after the end
of each calendar quarter to which such royalty payment relates. The
Minimum Royalty Payment, if any, shall be paid within forty-five (45)
days after the end of each calendar quarter. Each royalty payment shall
be accompanied by a written statement, showing (i) aggregate Net Sales
received by Licensee during such quarter in connection with the sale of
Sensors; (ii) Gross Margin earned by Licensee during such quarter in
connection with the sale or placement of Instruments; (iii) any
sublicense fees received; and (iv) the amount of royalty and sublicense
fees, as the case may be, payable to Licensor and ICCM with respect to
each of the foregoing, on a country by country basis. Licensee shall
submit such quarterly statements beginning with the first royalty
payment made pursuant to Sections 3.b-3.d.
g. Books and Records. Licensee agrees to keep for three (3)
years complete and accurate books of account and records covering all
transactions relating to this Agreement. Licensor, at its expense,
shall have the right to have an independent accounting firm, mutually
agreeable to both parties, one time in each calendar year on reasonable
notice, to audit Licensee's books of account and records that related
to the subject matter and terms of this Agreement. Licensor shall not
have any right to audit any other books of account or records of
Licensee. Such firm shall only disclose to Licensor (and copy Licensee)
such information as is necessary to verify the accuracy of Licensee's
statements.
4. Licensee's Development and Commercialization Efforts.
So long as the license granted herein remains exclusive,
Licensee shall use reasonable commercial efforts to develop and
commercialize Sensors and Instruments. Licensee shall be responsible
for:
a. funding and monitoring any clinical trial and/or outcome
studies as Licensee in its sole discretion deems appropriate;
12
b. R&D support and redesign of Sensors and Instruments (but
not manufacturing engineering support during Year 1);
c. manufacturing Sensors and Instruments and engineering
manufacturing support after Year 1; and
d. developing sales and marketing infrastructure.
5. Licensor's Development and Commercialization Efforts.
a. Licensor shall use reasonable commercial efforts to create
Model 3000 customer functional requirements which are agreeable to
Licensee so as to complete the Section 3.a(2) milestone as soon as
possible after the Effective Date.
b. Licensor shall use reasonable commercial efforts to achieve
the Model 3000 development to manufacturing transfer milestone set
forth in Section 3.a(3).
c. Licensor shall use reasonable commercial efforts to supply
Licensee with manufactured Sensors and Instruments in accordance with
the terms of the Supply Agreement, and to effectively transfer
manufacturing equipment, processes and knowledge to Licensee during the
term of the Supply Agreement.
d. Other than the amounts set forth in Section 3 and in the
Supply Agreement, Licensor shall not be entitled to any compensation
whatsoever for development and manufacturing of Sensors and
Instruments, or for providing support therefor. All amounts payable
under Section 3.a are for development and manufacturing support, and
are not prepaid royalties.
6. Licensee's Representations and Warranties.
13
Licensee hereby represents and warrants to Licensor that as of
the date hereof:
a. Licensee is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware, and this
Agreement has been duly authorized by all necessary corporate action.
b. This Agreement is the legal, valid and binding obligation
of Licensee, enforceable against Licensee in accordance with its terms.
c. Neither the execution and delivery of this Agreement nor
the compliance with the terms and conditions hereof will conflict with,
result in a breach or violation by Licensee of or constitute a default
under any of the terms, conditions or provisions of any contract,
agreement or other instrument to which Licensee is or may be bound or
affected.
d. Licensee is under no obligation or subject to any judicial,
administrative or other proceeding which would limit licensee's ability
to fully perform its obligations hereunder.
7. Licensor's Representations and Warranties.
Licensor hereby represents and warrants to Licensee that as of
the date hereof:
a. Licensor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware, and this
Agreement has been duly authorized by all necessary corporate action.
b. This Agreement is the legal, valid and binding obligation
of Licensor, enforceable against Licensor in accordance with its terms.
14
c. Neither the execution and delivery of this Agreement nor
the compliance with the terms and conditions hereof will conflict with,
result in a breach or violation by Licensor of or constitute a default
under any of the terms, conditions or provisions of any contract,
agreement or other instrument to which Licensor is or may be bound or
affected.
d. The Patent Rights include all patents and patent
applications that Licensor has any interest in and which are useable in
connection with making, using or selling Sensors and/or Instruments in
the Field of Use.
e. Except for the non exclusive rights Nihon Kohden has in
U.S. Patent No. 5,579,763 and foreign equivalents in conjunction with
ISFET pCO2 and CO2 sensors, Licensor is the sole and exclusive licensee
of the Exhibit A1 Patent Rights and Licensor has not granted any
licenses or any other rights in the Exhibit A1 Patent Rights to any
party other than Licensee. Licensor is the sole and exclusive owner of
the Exhibit A2 Patent Rights, free and clear of any license, security
interests, known claims, encumbrances or known charges of any kind, and
has full right, power and authority to enter into this Agreement and to
grant to Licensee the rights to be granted hereunder. Licensor has not
granted to any third party any rights of first refusal with respect to
the licenses granted herein or any other rights to obtain a license
from Licensor to practice the Patent Rights, other than as set forth in
the ICCM License.
f. Licensor is not under any obligations inconsistent with the
provisions of this Agreement.
g. To the best of Licensor's knowledge, (i) the Patent Rights
are valid and enforceable, including inventorship, and (ii) the rights
granted under this Agreement do not infringe any patent, copyright,
trademark, license, trade secret or other intellectual property right
of any third party. Licensor is not aware of any information which
could render any of the claims of any of the Patent Rights invalid or
unenforceable.
h. There is no legal, administrative, arbitration, or other
proceeding, suit, claim or action of any nature, judgment, decree,
decision, injunction, writ or order pending or,
15
to the knowledge of Licensor, threatened or contemplated by or against
or involving Licensor or its shareholders, directors or officers (but
only in their capacity as such), pertaining to the Patent Rights or
this Agreement, whether at law or in equity, before or by any person,
entity governmental or quasi-governmental, administrative or regulatory
agency or any court, other than pending patent applications.
i. OSI is in compliance with all, and not in breach of any of,
the terms of the ICCM License, including but not limited to all royalty
payments and development and commercialization obligations.
8. Term and Termination.
a. Term. The term of this Agreement shall commence on the
Effective Date and shall remain in force, unless terminated earlier in
accordance with Section 8.b, until the latest expiration date of a
validly issued U.S. or foreign patent subject to this Agreement.
b. Termination. Notwithstanding the provisions of Section 8.a,
this Agreement may be terminated in accordance with the following
provisions:
(1) By Licensor under Section 3.a(2).
(2) Upon mutual written agreement of the parties.
(3) Either party may terminate this Agreement by
giving notice in writing to the other party in the event the
other party is in material breach of this Agreement, so long
as the other party does not, in good faith, dispute the
validity of the breach, and the other party shall have failed
to cure such breach within ninety (90) days of receipt of
written notice thereof from the first party, unless such
breach cannot reasonably be cured within ninety (90) days, in
which case the breaching party shall have undertaken good
faith efforts to cure such breach within ninety (90) days. If
the breach is disputed, in good faith, the Agreement
16
can only be terminated on ninety (90) days notice after the
dispute is resolved unless such breach cannot reasonably be
cured within ninety (90) days, in which case the breaching
party shall have undertaken good faith efforts to cure such
breach within ninety (90) days.
(4) Licensee may terminate this Agreement immediately
if any material claim of ***.
(5) Licensee may terminate this Agreement for any
reason upon one hundred eighty (180) days notice anytime after
December 31, 2002.
c. Rights and Obligation on Termination. In the event of
termination of this Agreement for any reason, the parties shall have
the following rights and obligation:
(1) Licensee shall remain responsible for any payment
due to Licensor that has accrued prior to the effective date
of termination.
(2) The license granted to Licensee hereunder shall
immediately terminate and be of no further force and effect
for products not yet manufactured.
(3) Sections 10, 11.a, 11.b and 12 shall survive
termination of this Agreement.
(4) Licensee, its Affiliates and sublicensees shall
be permitted to sell any inventory of Sensors and Instruments
on hand at the effective date of termination, provided that no
provision of this Agreement shall prevent Licensee, its
Affiliates or sublicensees from practicing the Patent Rights
or selling Sensors and Instruments after termination of this
Agreement if the relevant Patent Rights have expired.
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
17
9. Patent Prosecution and Maintenance.
a. Existing Patents and Patent Applications and Licensor
Improvements. Licensor shall pay when due all maintenance fees for the
Patent Rights in accordance with applicable law and regulation.
Licensor shall prosecute the Patent Applications and any other
applications comprising the Patent Rights, at Licensor's expense. If
Licensor prosecutes any such patent application and a valid patent
issues thereon, then Licensor shall maintain, including payment of any
maintenance fees, any patents that issue on such patent application
that Licensor prosecuted. If Licensor (and ICCM) fails to prosecute or
maintain any such patent or patent application, Licensor shall so
notify Licensee in a timely manner, and Licensee shall have the right,
but not the obligation, to prosecute and maintain any such patent or
patent application, at Licensee's expense, and Licensor shall then
promptly assign to Licensee ownership of such patent or patent
application if owned by Licensor or assign its license to Licensee if
the patent or patent application is licensed to Licensor. Licensor
shall provide Licensee with copies of all relevant documentation on a
confidential basis so that Licensee may undertake such prosecution or
maintenance it assumes, and both parties shall keep the other informed
and apprised of the continuing prosecution and maintenance with respect
to all Patent Rights.
b. Future Patents and Patent Applications Covering Licensee
Improvements. Licensee shall have the right, but not the obligation, to
prosecute and maintain any patent applications covering any
modifications or improvements it creates to the Sensors and
Instruments, at Licensee's expense. All such modifications and
improvements shall be solely owned by Licensee. Licensee shall
determine in its sole discretion whether any particular patent
application shall be filed or prosecuted or any patent shall be
maintained pursuant to this Section 9.b. Any such patent application
and patent shall be in the name of Licensee and shall not be part of
the Patent Rights.
18
10. Infringement.
a. Action by Licensor. When information comes to the attention
of Licensor or Licensee to the effect that any of the Patent Rights
have been or are threatened to be infringed by a third party, Licensor
shall have the initial right, but not the obligation, at its expense,
to take such action as Licensor may deem necessary to prosecute or
prevent such Third Party Infringement, including the right to bring any
suit, action or proceeding (or defend a declaratory judgement action)
involving any such Third Party Infringement. Licensor shall notify
Licensee promptly of the receipt of any such information and of the
commencement of any such suit, action or proceeding. If Licensor
determines that it is necessary or desirable for Licensee to join any
such suit, action or proceeding, Licensee shall execute all documents
and perform such other acts as may be reasonably required. In the event
that Licensor brings a suit, any sums recovered in such suit or in
settlement thereof shall be distributed as follows: (i) first to
Licensor for reimbursement for all costs and expenses, including
reasonable attorneys' fees, involved in such suit; (ii) second to
Licensor for accrued and unpaid royalties, if any; and (iii) the
balance, if any, *** percent (***%) to Licensee and *** percent (***%)
to Licensor.
b. Action by Licensee. If, within ninety (90) days after
receipt of infringement information described in Section 10.a or after
giving ninety (90) days notice to Licensee of such information,
Licensor does not notify Licensee that Licensor has commenced suit
against any infringer, Licensee shall have the right, but not the
obligation, to bring suit (or defend a declaratory judgement action)
for such alleged Third Party Infringement. Licensee may join Licensor
and/or ICCM as party plaintiff (or declaratory judgement defendant), if
appropriate, or if Licensor and/or ICCM is not joined Licensor and/or
ICCM shall assign the relevant Patent Rights to Licensee. Licensor and
ICCM shall execute all documents and take all other actions, including
giving testimony, which may reasonably be required in connection with
such suit, action or proceeding. Licensor hereby grants to Licensee the
right to exclusive control of any such suit, action or
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
19
proceeding and the exclusive right to compromise, litigate, settle or
otherwise dispose of any such suit, action or proceeding. In the event
that Licensee brings a suit, any sums recovered in such suit or in
settlement thereof shall be distributed as follows: (i) first to
Licensee for reimbursement for all costs and expenses, including
reasonable attorneys' fees, involved in such suit; (ii) second to
Licensor for accrued and unpaid royalties, if any; and (iii) the
balance, in any, *** percent (***%) to Licensee and *** percent (***%)
to Licensor.
c. Joint Action. If a third party infringes any Patent Rights
and any relevant patent owned by Licensee, Licensor and Licensee may
elect to jointly bring (or jointly defend in a declaratory judgement
action) a suit, action or proceeding to stop all Third Party
Infringement and infringement of patents owned by Licensee, and will
equally share all costs and expenses, including reasonable attorneys'
fees, involved in such suit. In the event that Licensor and Licensee
jointly bring a suit, any sums recovered in such suit or in settlement
thereof shall be distributed as follows: (i) first to Licensor and
Licensee for reimbursement for all costs and expenses, including
reasonable attorneys' fees, involved in such suit; (ii) second to
Licensor for accrued and unpaid royalties; if any; and (iii) the
balance, if any, *** percent (***%) to Licensee and *** percent (***%)
to Licensor. If one party hereto elects not to join in such suit after
ninety (90) days notice, the other party many proceed with the suit as
provided in Section 10.a or 10.b, as the case may be.
d. Enforcement of Licensee Patents. Licensee shall have sole
authority and responsibility for enforcing Licensee-owned patents
against infringement.
e. Reduction of License Payments Due to Competitive Product
and Suit. Notwithstanding the parties' efforts pursuant to Sections
10.a-10.c, if a competitor is selling or offering to sell a product
that infringes any of the independent claims of U.S. Patent No. *** (or
reissue or reexamination patents thereof) and which is competitive with
Sensors or Instruments, then:
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
20
(1) if the Third Party Infringement is in a Major
Country, the Minimum Royalty Payments shall be suspended as
long as the Third Party Infringement continues, and will only
resume when all such Third Party Infringement ceases in all
Major Countries, the resumption being at the minimum royalty
rate in effect at the time the suspension began;
(2) if the Third Party Infringement is anywhere in
the world and Licensee's fiscal annual Net Sales are decreased
in any given country by *** percent (***%) or more of any
prior fiscal annual level in the previous three (3) years in
such given country, then the royalties owed to Licensor under
Sections 3.c and 3.d for such country(ies) shall continue to
accrue but the amount that is payable shall be reduced by ***
with respect to sales in the country in which Net Sales have
so decreased by *** percent (***%) so long as the Third Party
Infringement continues in such country, and unpaid accrued
amounts shall only be payable out of any sums recovered from
actions brought under Sections 10.a-c, and in addition;
(3) if Licensee brings a suit, action or proceeding
(or defends a declaratory judgement action) associated with
the Third Party Infringement, all royalties thereafter
accruable to Licensor under Sections 3.c and 3.d (but not
including amounts payable under Section 3.b) shall be
creditable against all costs and expenses, including
reasonable attorneys' fees, and damages involved in such suit
(and to the extent so credited such royalties shall not be
payable to Licensor) until all such costs, expenses and
damages have been recovered by Licensee using credited
royalties and any settlement or judgement amount collected
from the infringer. Ongoing Licensor royalties shall only
restart and be payable to Licensor for Net Sales which result
in royalties which exceed all such Licensee costs, expenses
and damages.
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
21
f. Action Against Licensee. Licensor will cooperate with
Licensee in the defense of any suit, action or proceeding against
Licensee, or any Affiliate or sublicensee of Licensee, alleging the
infringement of a patent or other intellectual property right owned by
a third party by reason of the use of the Patent Rights in the
manufacture, use, promotion or sale of Sensors and/or Instruments.
Licensee shall give Licensor prompt notice of the commencement of any
such suit, action or proceeding or claim of infringement. Licensor
hereby grants to Licensee the right to exclusive control of any such
suit, action or proceeding and the exclusive right to compromise,
litigate, settle or otherwise dispose of any such suit, action or
proceeding and shall provide all information and assistance necessary
to defend or settle any such suit, action or proceeding. Licensee may
join Licensor as a defendant, if necessary or desirable, and Licensor
shall execute all documents and take all other actions, including
giving testimony, which may reasonably be required in connection with
the defense of such suit, action or proceeding. Licensee shall be
solely responsible for all out-of-pocket defense costs (including
attorney fees) incurred by Licensee with the defense of such suit,
action or proceeding, and Licensee shall be entitled to retain any
recovery associated with such suit, action or proceeding. Licensor
shall be responsible to Licensee for half of any damages awarded to
such third party in such suit, action or proceeding, or in settlement
thereof. Licensor shall pay Licensee its share of such damages as
follows:
Within thirty (30) days of a final judgement or settlement, an
amount not to exceed all royalties paid to Licensor during the
period the suit, action or proceeding was pending, and to the
extent any amount of Licensor's share of such damages remains,
Licensee shall take a credit against all royalties thereafter
payable to Licensor under Section 3.c (but not including
amounts payable under Section 3.b) until all such Licensor's
share of damages is paid.
g. ***
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
22
11. Indemnification and Insurance.
a. Indemnification by Licensor. Licensor shall indemnify, hold
harmless, defend and protect Licensee and its Affiliates, sublicensees,
successors, assigns, employees, representatives and agents from and
against any and all claims, causes of action, costs, expenses, losses,
damages and liabilities (including, without limitation, reasonable
attorneys' fees) arising out of or resulting from (i) any breach by
Licensor of this Agreement, (ii) any claim by ICCM that OSI is in
breach of the ICCM License and which breach is cured by Nellcor, (iii)
any claim that any rights within Patent Rights were granted by Licensor
to any third party, or (iv) any unlawful misappropriation by Licensor
of trade secrets or proprietary rights belonging to any third party.
Licensee shall have the right to deduct any amount to which it is
entitled to indemnification hereunder against royalties or other
payments due under Sections 3.a, 3.c and 3.d as long as Licensee pays
all such deducted amounts to a third party escrow agent, which is
reasonably satisfactory to Licensee and Licensor, to be held until the
indemnification claim is resolved.
b. Indemnification by Licensee. Licensee shall indemnify, hold
harmless, defend and protect Licensor and its Affiliates, successors,
assigns, employees, representatives and agents, from and against any
and all claims, causes of action, costs, expenses, losses, damages and
liabilities (including, without limitation, reasonable attorneys' fees)
arising out of or resulting from any breach by Licensee of this
Agreement.
c. OSI Breach of ICCM License. In addition to rights NPB has
under Section 11.a, if OSI breaches the ICCM License more than once,
and NPB chooses to cure such breaches, the ICCM License shall
immediately revert from OSI and be assigned to NPB by OSI and NPB shall
immediately assume all OSI rights and obligations under the ICCM
License. In addition, if the cure of any single breach by OSI costs NPB
one million dollars ($1,000,000) or more to correct, the ICCM License
shall immediately revert from OSI and be assigned to NPB by OSI and NPB
shall immediately assume all OSI rights and obligations under the ICCM
License. NPB may only exercise its rights under this Section 11.c only
if NPB is in compliance with this Agreement.
23
12. Confidentiality.
Each party agrees not to disclose to any third party or use
the other party's Confidential Information, as defined in this Section
12, other than for purposes of this Agreement. Upon termination of this
Agreement, all Confidential Information shall be returned to the
disclosing party. "Confidential Information" means any information
which is disclosed in any tangible form and is clearly labeled or
marked as confidential, proprietary or its equivalent, or information
which is disclosed orally or visually, is designated confidential,
proprietary or its equivalent at the time of its disclosure and is
reduced to writing and clearly marked or labeled as confidential,
proprietary or its equivalent within thirty (30) days of disclosure;
provided that "Confidential Information" shall not include information
that (i) was in the receiving party's possession or was known to it
prior to its receipt from the disclosing party; (ii) is or becomes
public knowledge without the fault of the receiving party; (iii) is or
becomes rightfully available on an unrestricted basis to the receiving
party from a source other than the disclosing party; (iv) becomes
available on an unrestricted basis to a third party from the disclosing
party or from someone acting under its control; (v) is independently
developed by the receiving party as demonstrated by its written
records.
13. Covenant Not to Compete
So long as Licensee's license is in force and is exclusive,
Licensor agrees not to compete with Licensee by making and/or selling
any product for any third party or providing any service to any third
party in the Field of Use. Licensor retains the right to make and/or
sell any existing or future product for any third party or to provide
service to any third party outside of the Field of Use.
14. Miscellaneous.
24
a. Public Announcements. Each of the parties hereto agrees
that it will not, without the prior written consent of the other party,
make any public announcement of this Agreement or any of the terms and
conditions of this Agreement, except for such disclosure to the public
or to governmental agencies as its counsel shall deem necessary to
comply with applicable law, rule or regulation. Notwithstanding the
foregoing, either party may disclose publicly that Licensor has granted
Licensee an exclusive, worldwide license to manufacture and sell
Sensors and Instruments within the Field of Use.
b. Assignment. Neither party may assign or otherwise transfer
its rights and obligations under this Agreement without the prior
written consent of the other party, except to (i) an Affiliate,
provided that the original party to the Agreement remains obligated to
perform under this Agreement or (ii) any successor in interest of all
or substantially all of the business of such party relating to the
licensed Patent Rights, whether by merger, operation of law,
assignment, purchase or otherwise. Any prohibited assignment shall be
null and void. All terms and conditions of this Agreement shall be
binding on and inure to the benefit of the successors and permitted
assigns of the parties.
c. Relationship. This Agreement shall not constitute either
party as the legal representative, partner, joint venturer or agent of
the other party hereto, nor shall either party have the right or
authority to assume, create or incur any liability or any obligation of
any kind, express or implied, against or in the name of or on behalf of
the other party hereto.
d. Entire Agreement; Amendment. This Agreement, the
Supplemental Agreement, the ICCM License and the Supplier Agreement
constitute the entire agreement between the parties hereto relative to
the subject matter hereof, and supersedes any and all prior agreements,
written or oral, between the parties relating to such subject matter.
No modifications or amendments of any of the terms hereof shall be
valid or binding unless made in writing and signed by Licensor and
Licensee.
e. Waiver. No waiver of any breach of any provision of this
Agreement shall constitute a waiver of any prior, concurrent or
subsequent breach of the same or any other
25
provision hereof, and no waiver shall be effective unless made in
writing.
f. Patent Recording. Licensor agrees to execute documents in
the form given in Exhibit C for recording (at Licensee's expense) with
the United States Patent Office for each patent included in the Patent
Rights which issues in the United States. Licensor will cause such
documents to be filed with the United States Patent Office for
recording within thirty (30) days of the Effective Date of this
Agreement or within thirty (30) days of issuance, whichever occurs
later. Licensor further agrees to cooperate in executing and filing any
additional forms necessary to perfect rights of Licensee granted
herein. Licensee agrees to cooperate in executing and filing any
additional forms desired by Licensor (at Licensor's expense) in the
event the license to Licensee becomes nonexclusive or is terminated.
g. Notices. Notice permitted or required to be given under
this Agreement shall be deemed sufficient if given in writing by
facsimile, commercial air delivery service or by registered or
certified air mail, postage prepaid, return receipt requested,
addressed to the respective addresses of the parties set forth below or
at such other address as the respective parties may designate by like
notice from time to time. Notices so given shall be effective upon the
earlier of: (i) receipt by the party to which notice is given (which,
in the instance of a facsimile, shall be deemed to have occurred at the
time that the machine transmitting the facsimile verifies a successful
transmission of the facsimile); (ii) on the fifth business day
following the date such notice was deposited in the mail; or (iii) on
the second business day following the date such notice was delivered to
a commercial air delivery service. Notices shall be given as follows:
If to Licensor: Optical Sensors Incorporated
0000 Xxxxxx Xxxxxxxx Xxxxx
Xxxxx X
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attn: Chief Executive Officer
Fax: (000) 000-0000
If to Licensee: Nellcor Puritan Xxxxxxx, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
26
Attn: President, Nellcor Business Unit
Fax: (000) 000-0000
With a copy to: Nellcor Puritan Xxxxxxx, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attn: General Counsel
Fax: (000) 000-0000
h. Severability. If any provision of this Agreement shall be
held invalid or unenforceable by any court of competent jurisdiction,
the remaining provisions of this Agreement shall remain in full force
and effect. Further, should any provision of this Agreement be deemed
unenforceable by virtue of its scope, such provision shall be deemed
limited to the extent necessary to render the same enforceable.
i. Governing Law. This Agreement will be construed in
accordance with, and governed by, the laws of the State of California
in all respects, including, without limitation, interpretation,
performance, effect and remedies (without regard to the laws of
conflict of any jurisdiction).
j. Headings. The headings of sections and subsections of this
Agreement have been inserted for the convenience of reference only and
shall in no way restrict or otherwise modify the terms on this
Agreement.
k. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but each
of which together shall constitute one and the same document.
27
IN WITNESS WHEREOF, the parties hereto have executed this License
Agreement as of the date and year written below.
OPTICAL SENSORS INCORPORATED
By /s/ Xxxxxxx X. XxXxxxxx
----------------------------
Xxxxxxx X. XxXxxxxx
President
Date: September 28, 2001
--------------------------
NELLCOR PURITAN XXXXXXX INCORPORATED
By /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Xxxxx X. Xxxxxxxx
President
Date: September 28, 2001
--------------------------
28
EXHIBIT A1
----------
Patents and Patent Applications
-----------------------------------------------------------------------------------------------------------------------------
OSI Country Patent No. or Title Status
Reference Appl. No.
No.
-----------------------------------------------------------------------------------------------------------------------------
0379-0046 US 5,579,763 MEASUREMENT OF SYSTEMIC PERFUSION Issued, 2nd Maintenance Fee due June 3,
2004, no foreign filings
-----------------------------------------------------------------------------------------------------------------------------
0379-0046.20 US 08/710,208 MINIMALLY INVASIVE MEASUREMENT OF Abandoned, Filed September 13, 1996.
SYSTEMIC PERFUSION
-----------------------------------------------------------------------------------------------------------------------------
0379-0046.21 US 08/939,591 MINIMALLY INVASIVE MEASUREMENT OF Abandoned, Filed September 29, 1997.
SYSTEMIC PERFUSION
-----------------------------------------------------------------------------------------------------------------------------
0379-0046.22 US 6,055,447 MINIMALLY INVASIVE MEASUREMENT OF Issued, 1st Maintenance Fee due October
SYSTEMIC PERFUSION 24, 2003
-----------------------------------------------------------------------------------------------------------------------------
0379-0046.23 US 6,216,024 METHOD AND DEVICE FOR ASSESSING Issued, 1st Maintenance Fee due March 24,
PERFUSION FAILURE IN A PATIENT 2002
-----------------------------------------------------------------------------------------------------------------------------
0379-0046.40 PCT Pub. PCT/US98/20118 MINIMALLY INVASIVE MEASUREMENT OF In National Phase in EPO, Australia,
from WO 99/16346 SYSTEMIC PERFUSION Canada, Japan, Filed September 25, 1998,
00379-0046.23 Published
-----------------------------------------------------------------------------------------------------------------------------
*** *** **** *** ***
-----------------------------------------------------------------------------------------------------------------------------
*** *** **** *** ***
-----------------------------------------------------------------------------------------------------------------------------
0379-0046.43 EPO 98948547.9 METHOD AND DEVICE FOR ASSESSING Pending, Filed September 25, 1998,
PERFUSION FAILURE IN A PATIENT Designated France, Germany, UK, Italy,
Netherlands, and Spain. Bibliographic
data published July 19, 2000 under
EP-A-1018933.
-----------------------------------------------------------------------------------------------------------------------------
0379-0046.44 Japan 2000-513493 METHOD AND DEVICE FOR ASSESSING Pending, Filed September 25, 1998
PERFUSION FAILURE IN A PATIENT
-----------------------------------------------------------------------------------------------------------------------------
0379-0046.24 US 6,258,046 METHOD AND DEVICE FOR ASSESSING Issued,
PERFUSION FAILURE IN A PATIENT BY
MEASUREMENT OF BLOOD FLOW
-----------------------------------------------------------------------------------------------------------------------------
*** *** **** *** ***
-----------------------------------------------------------------------------------------------------------------------------
0379-0046WO2 PCT Pub. PCT.US00/08683 METHOD AND DEVICE FOR ASSESSING In National Phase, entered during
WO 00/59372 PERFUSION FAILURE IN A PATIENT BY September 2001 designating EPO, Japan,
MEASUREMENT OF BLOOD FLOW Australia, and Canada
-----------------------------------------------------------------------------------------------------------------------------
TBD Austrailia NA METHOD AND DEVICE FOR ASSESSING NA
PERFUSION FAILURE IN A PATIENT BY
MEASUREMENT OF BLOOD FLOW
-----------------------------------------------------------------------------------------------------------------------------
TBD Canada NA METHOD AND DEVICE FOR ASSESSING NA
PERFUSION FAILURE IN A PATIENT BY
MEASUREMENT OF BLOOD FLOW
-----------------------------------------------------------------------------------------------------------------------------
TBD EPO NA METHOD AND DEVICE FOR ASSESSING NA
PERFUSION FAILURE IN A PATIENT BY
MEASUREMENT OF BLOOD FLOW
-----------------------------------------------------------------------------------------------------------------------------
TBD Japan NA METHOD AND DEVICE FOR ASSESSING NA
PERFUSION FAILURE IN A PATIENT BY
MEASUREMENT OF BLOOD FLOW
-----------------------------------------------------------------------------------------------------------------------------
0379-0048 US 6,071,237 pCO2 DETERMINATION IN THE TRACHEA Issued, 1st Maintenance Fee due December
6, 2003
-----------------------------------------------------------------------------------------------------------------------------
0379-0048.40 PCT Pub. PCT/US00/04305 pCO2 DETERMINATION IN THE TRACHEA In National Phase, entered during month of
August 2001 designating EPO, Japan,
Australia, and Canada
-----------------------------------------------------------------------------------------------------------------------------
TBD Austrailia NA pCO2 DETERMINATION IN THE TRACHEA NA
-----------------------------------------------------------------------------------------------------------------------------
TBD Canada NA pCO2 DETERMINATION IN THE TRACHEA NA
-----------------------------------------------------------------------------------------------------------------------------
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
29
-----------------------------------------------------------------------------------------------------------------------------
TBD EPO NA pCO2 DETERMINATION IN THE TRACHEA NA
-----------------------------------------------------------------------------------------------------------------------------
TBD Japan NA pCO2 DETERMINATION IN THE TRACHEA NA
-----------------------------------------------------------------------------------------------------------------------------
*** *** **** *** ***
-----------------------------------------------------------------------------------------------------------------------------
*** *** **** *** ***
-----------------------------------------------------------------------------------------------------------------------------
*** *** **** *** ***
-----------------------------------------------------------------------------------------------------------------------------
*** *** **** *** ***
-----------------------------------------------------------------------------------------------------------------------------
*** *** **** *** ***
-----------------------------------------------------------------------------------------------------------------------------
*** Portions of this Exhibit have been omitted pending a confidential
treatment request by the Company.
30
EXHIBIT A2
----------
Patents and Patent Applications
-----------------------------------------------------------------------------------------------------------------------------
OSI Country Patent No. or Title Status
Reference Appl. No.
No.
-----------------------------------------------------------------------------------------------------------------------------
0379-0031 US 5,672,515 SIMULTANEOUS DUAL EXCITATION / Issued, 2nd Maintenance fee due March 30th,
SINGLE EMISSION FLUORESCENT 2005.
SENSING TECHNIQUE FOR pH
-----------------------------------------------------------------------------------------------------------------------------
0379-0031.40 PCT Pub. PCT/US96/13791 SIMULTANEOUS DUAL EXCITATION / In National Phase in EPO, Canada, and Japan,
WO 97/10495 SINGLE EMISSION FLUORESCENT Filed August 27, 1996, Published
SENSING TECHNIQUE FOR pH
-----------------------------------------------------------------------------------------------------------------------------
0379-0031.41 Canada 2,231,771 SIMULTANEOUS DUAL EXCITATION / Pending, 1st Office Action Received
SINGLE EMISSION FLUORESCENT
SENSING TECHNIQUE FOR pH
-----------------------------------------------------------------------------------------------------------------------------
0379-0031.42 EPO 96929074.1 SIMULTANEOUS DUAL EXCITATION / Pending, August 27, 1996 Filing Date.
SINGLE EMISSION FLUORESCENT Designated France, Germany, UK, Italy,
SENSING TECHNIQUE FOR pH Netherlands, and Spain. Bibliographic data
published July 1, 1998 under EP-A-0850409
-----------------------------------------------------------------------------------------------------------------------------
0379-0031.43 Japan 9-511977 SIMULTANEOUS DUAL EXCITATION / Pending, August 27, 1996 Filing Date.
SINGLE EMISSION FLUORESCENT Published October 26, 1999 under 11-512521.
SENSING TECHNIQUE FOR pH Request for examination not filed.
-----------------------------------------------------------------------------------------------------------------------------
0379.0034 & US 5,714,121 OPTICAL CARBON DIOXIDE SENSOR AND Issued, 1st maintenance fee due August 3,
.10 ASSOCIATED METHODS OF MANUFACTURE 2001.
-----------------------------------------------------------------------------------------------------------------------------
0379.0034.40 PCT Pub. PCT/US96/15353 OPTICAL CARBON DIOXIDE SENSOR AND In National Phase in EPO, Australia, Canada,
WO 97/12227 ASSOCIATED METHODS OF MANUFACTURE and Japan, Filed September 25, 1996, Published
-----------------------------------------------------------------------------------------------------------------------------
0379.0034.41 Austrailia 715,086 OPTICAL CARBON DIOXIDE SENSOR AND Issued
ASSOCIATED METHODS OF MANUFACTURE
-----------------------------------------------------------------------------------------------------------------------------
0379.0034.42 Canada 2,233,284 OPTICAL CARBON DIOXIDE SENSOR AND Pending, Filed September 25, 1996, A Request
ASSOCIATED METHODS OF MANUFACTURE for Examination not filed.
-----------------------------------------------------------------------------------------------------------------------------
0379.0034.43 EPO 96933131.3 OPTICAL CARBON DIOXIDE SENSOR AND Pending, Filed September 25, 1996, Designated
ASSOCIATED METHODS OF MANUFACTURE France, Germany, UK, Italy, Netherlands, and
Spain. Bibliographic data published August 19,
1998 under EP-A-0858594. Response to 1st
office action filed September of 2000.
-----------------------------------------------------------------------------------------------------------------------------
0379.0034.44 Japan 9-513592 OPTICAL CARBON DIOXIDE SENSOR AND Pending, Filed September 25, 1996, Published
ASSOCIATED METHODS OF MANUFACTURE on November 2, 1999 under 11-512819. Request
for examination not filed.
-----------------------------------------------------------------------------------------------------------------------------
0379-0039 US 5,690,215 DEVICE FOR MAINTAING THE PARTIAL Issued, 2nd Maintenance Fee due May 25, 2005.
PRESSURE OF A DISSOLVED GAS IN A
FLUID AND RELATED METHODS OF USE
-----------------------------------------------------------------------------------------------------------------------------
0379-0039.40 PCT Pub. PCT/US97/08795 DEVICE FOR MAINTAING THE PARTIAL In National Phase in EPO, Australia, Canada,
WO 98/01365 PRESSURE OF A DISSOLVED GAS IN A Japan, Filed May 21, 1997, Published
FLUID AND RELATED METHODS OF USE
-----------------------------------------------------------------------------------------------------------------------------
0379-0039.41 Austrailia 712,791 DEVICE FOR MAINTAING THE PARTIAL Issued
PRESSURE OF A DISSOLVED GAS IN A
FLUID AND RELATED METHODS OF USE
-----------------------------------------------------------------------------------------------------------------------------
0379-0039.42 Canada 2,259,412 DEVICE FOR MAINTAING THE PARTIAL Pending, Filed September 21, 1997, A Request
PRESSURE OF A DISSOLVED GAS IN A for Examination filed May of 2001.
FLUID AND RELATED METHODS OF USE
-----------------------------------------------------------------------------------------------------------------------------
0379-0039.43 EPO 97928652.3 DEVICE FOR MAINTAING THE PARTIAL Pending, Filed September 21, 1997,
PRESSURE OF A DISSOLVED GAS IN A Designated France, Germany, UK, Italy,
FLUID AND RELATED METHODS OF USE Netherlands, and Spain. Bibliographic data
published July 21, 1999 under EP-A-0929470.
-----------------------------------------------------------------------------------------------------------------------------
0379-0039.44 Japan 10-505185 DEVICE FOR MAINTAING THE PARTIAL Pending, Filed September 21, 1997
PRESSURE OF A DISSOLVED GAS IN A
FLUID AND RELATED METHODS OF USE
-----------------------------------------------------------------------------------------------------------------------------
31
EXHIBIT B
---------
Methodology Currently Used for Calculating Direct Cost of Manufacturing
At the beginning of each calendar year, Licensee projects total
manufacturing overhead costs, total purchased materials cost, and total direct
labor hours to produce product for sale for such year. Manufacturing overhead
costs consist of the costs of facilities, utilities, staff, travel and expenses
related to the production of product as accumulated in individual departmental
budgets. Total purchased materials costs are estimated by suppliers. Total
direct labor hours are estimated by extending engineered per unit direct labor
hours multiplied by the projected unit production of products. Total
manufacturing overhead costs are then divided by total direct labor hours to
arrive at a per direct labor hour manufacturing overhead rate. The average cost
of any individual product is determined by applying a direct labor rate and a
manufacturing overhead rate against the estimated direct labor hours for that
product, plus direct material costs. Total cost of sales for that product for
the year is determined by multiplying unit sales by the per unit standard cost.
32
EXHIBIT C
---------
Notice of License
To Whom It May Concern
Notice is hereby given by Optical Sensors Incorporated, having its
principal office at 0000 Xxxxxx Xxxxxxxx Xxxxx, Xxxxx X, Xxxxxxxxxxx, Xxxxxxxxx
00000 ("OSI"), and Nellcor Puritan Xxxxxxx, Inc., having its principle office at
0000 Xxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxxx 00000 ("Nellcor"), wherein OSI
granted Nellcor an exclusive Field of Use license to practice the invention
claimed by the following patent:
__________________, which was issued on ______________, entitled
____________________, including all divisionals, continuations,
continuations-in-part, reissues, reexaminations or extensions thereof and any
letters of patent that issue thereon.
OPTICAL SENSORS INCORPORATED
By:
-------------------------------
Print Name:
-----------------------
Title:
----------------------------
Date:
-----------------------------
33
