TRADEMARK LICENSE AGREEMENT
Exhibit 10.2
CONFIDENTIAL
THIS TRADEMARK LICENSE AGREEMENT (the “Agreement”) is effective as of January 28, 2011 (the
“Effective Date”) by and between Xxxxxx Medical Technology Inc., a Delaware corporation located at
0000 Xxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxx, 00000 (“Licensor”) and KCI Medical Resources, an unlimited
company organized and existing under the laws of Ireland, but resident in the Cayman Islands, with
its principal place of business located at Zephyr House, Xxxx Street, P.O. Box 709 GT, Grand
Cayman, Cayman Islands (“Licensee”).
WHEREAS, Licensor is the owner of all right, title and interest in, to and under the marks
listed on Exhibit A attached hereto and any variants thereof and any application and registrations
therefor, together with any foreign counterparts thereof (the “Licensed Marks”);
WHEREAS, Licensee is desirous of using the Licensed Marks identified in the attached Exhibit A
in connection with its wound care business;
NOW THEREFORE, for and in full consideration of the mutual promises contained herein, and
other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
the parties mutually agree as follows:
1. License Right Granted.
A. Licensor hereby grants to Licensee, and Licensee accepts, upon the terms and conditions set
forth herein, a non-transferable, non-sublicensable, worldwide,
exclusive, perpetual license (the
“License”) to use the Licensed Marks in connection with the marketing, sale, distribution and
provision of any of Licensee’s soft tissue graft containment products, excluding all such products
that are [***], commercialized in the Wound Care Field (the “Licensed Goods”). The “Wound Care
Field” shall mean the care and treatment of acute, surgical, and chronic wounds, such as, by
non-limiting example, diabetic foot ulcers, venous leg ulcers, and pressure ulcers. Subject to the
provisions of Section 3 below, Licensee may change the branding of any of its products in the Wound
Care Field without the consent of Licensor. Any use by Licensee of the Licensed Marks outside of
the Wound Care Field or in connection with soft tissue graft containment products that are [***],
shall require prior written approval of Licensor, which consent may be withheld by Licensor for any
reason in its sole discretion. Any use by Licensor of the Licensed Marks inside of the Wound Care
Field or in connection with soft tissue graft containment products that are [***] shall require
prior written approval of Licensee, which consent may be withheld by Licensee for any reason in its
sole discretion. Subject to the provisions of Section 10 below, Licensee’s rights to use the
Licensed Marks shall extend beyond the end of the royalty period.
B. Licensor shall not promote, market, solicit or otherwise participate in the sale of soft tissue
graft containment products in the Wound Care Field during the period from June 30, 2011, until
December 31, 2021; provided, however, that Licensee acknowledges that Licensor shall have the right
to continue to promote, market, solicit or otherwise participate in the sale of current and future
products based on its [***] platform currently marketed
and sold under the name Biotape (the “WMT Porcine Platform”) to the hospital market, provided that
Licensor will not, and will not permit, authorize, or license any third party to, begin commercial
sales of any new products based on the WMT Porcine Platform (i.e. products not sold by Licensor as
of the Effective Date) that are specifically indicated for the Wound Care Field to the hospital
market prior to the second anniversary of the Effective Date (the “Exclusion Period”). For the
avoidance of doubt, the “hospital market” shall not
| [***] | Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment. |
include the post acute wound care market, including, without limitation, wound care facilities,
outpatient facilities, or ambulatory surgical centers. Notwithstanding the provisions of this
Section, it is understood and agreed that if Licensor or Licensor’s orthopedic human derived tissue
product line or business is acquired by an entity that is already engaged (either directly or
through one or more of its affiliates) in the business of manufacturing, marketing, selling,
distributing or providing human derived tissue products in the Wound Care Field at the time of the
acquisition, the restrictions set forth in this paragraph will not apply to such acquirer or its
other affiliates after the closing date of such acquisition, but all other rights and obligations
of Licensor and Licensee shall continue under this Agreement except that Licensee shall have no
obligation to make payment of any amounts due to Licensor under Sections 5 and 6 that become due
after the closing date of such acquisition.
C. (i) Each party shall promptly notify the other party in writing if it becomes aware of any
infringement, or suspected or threatened infringement of the Licensed Marks in the Wound Care
Field.
(ii) In the event of any infringement, or suspected or threatened infringement of the Licensed
Marks in the Wound Care Field, Licensee shall have the right and option (but not the obligation) to
institute and control a legal action to prosecute, settle or compromise such infringement (an
“Infringement Action”); provided, however, that Licensee shall not settle or compromise any
Infringement Action for which it assumes responsibility pursuant to this Section that imposes any
obligation on Licensor or that would legally impair the Licensed Marks, without the prior written
consent of Licensor, which consent shall not be unreasonably withheld or delayed. In furtherance
of the foregoing, Licensee may include Licensor as a party in any such Infringement Action, and
Licensor shall (at Licensee’s expense) join such Infringement Action at the direction of Licensee
and provide reasonable cooperation to Licensee in any such Infringement Action. Licensee shall
bear all costs and expenses of any Infringement Action for which it assumes responsibility pursuant
to Section.
(iii) If Licensee fails or elects not to commence or continue prosecution or defense of an
Infringement Action within thirty (30) days after a written request from Licensor, Licensor may do
so at any time thereafter upon written notice thereof to Licensee; provided, however, that Licensor
shall not settle or compromise any Infringement Action for which it assumes responsibility pursuant
to this Section that imposes any obligation on Licensee or that impairs Licensee’s exclusive rights
under this Agreement to use the Licensed Marks in the Wound Care Field, without the prior written
consent of Licensee, which consent shall not be unreasonably withheld or delayed. Licensee shall
cooperate fully in any such Infringement Action controlled by Licensor, including, if requested by
Licensor, being named as a party in any such Infringement Action. Licensor shall bear all costs
and expenses of any Infringement Action for which it assumes responsibility pursuant to Section.
(iv) Any and all recoveries or reimbursements from any Infringement Action, if any, shall be
divided between the parties as follows:
| (a) | first, each party shall be reimbursed for any and all costs and expenses it incurred in connection with such action; | ||
| (b) | next, as to any compensatory or punitive or willful damages or any award of attorneys’ fees in excess of the amount paid to the parties as reimbursement of costs and expenses pursuant to the preceding subparagraph, (1) Licensor shall retain any such excess in any Infringement Action for which it assumes responsibility pursuant to this Section, and (2) Licensee shall retain any such excess in any |
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| Infringement Action for which it assumes responsibility pursuant to this Section. |
D. Without limiting the restrictions applicable to the Licensor during the Exclusion Period as
set forth in Section 1B above, Licensor hereby grants to Licensee a right of first refusal to
obtain exclusive rights to market, sell and distribute in the Wound Care Field any new products
developed by Licensor after the Effective Date based on the WMT Porcine Platform for
commercialization in the Wound Care Field (each a “New Porcine Product”) as follows:
(i) If
at any time prior to the earlier of December 31, 2021 or the termination of this
Agreement, Licensor undertakes to commercialize any New Porcine Product in the Wound Care Field,
Licensor shall give Licensee written notice of such commercialization (the “New Product Notice”)
not less than 90 days prior to the first commercial sale of such New Porcine Product in the Wound
Care Field. If Licensee in interested in obtaining exclusive rights to market, sell and distribute
such New Porcine Product in the Wound Care Field, Licensee shall give written notice thereof to the
Licensor within 30 days following its receipt of the New Product Notice (the “Notice of Interest”),
and Licensor and Licensee shall thereafter use reasonable, good faith efforts to negotiate a
Distribution Agreement granting Licensee exclusive distribution rights with respect to such New
Porcine Product in the Wound Care Field on mutually agreeable terms and conditions. If Licensee
fails to deliver a Notice of Interest within 30 days following its receipt of the New Product
Notice, Licensee will be deemed to have irrevocably waived its right of first refusal hereunder
with respect to such New Porcine Product.
(ii) If
Licensee delivers a Notice of Interest with respect to a New Porcine
Product within 30 days following its receipt of the New Product Notice but the parties are unable, after good faith
efforts, to negotiate a Distribution Agreement with respect to such New Porcine Product on mutually
agreeable terms and conditions pursuant to Section 1D(i) above
within 60 days after Licensee’s
receipt of the Notice of Interest, Licensor shall be free to commercialize such New Porcine Product
in the Wound Care Field without granting distribution rights to Licensee; provided, however, that
prior to granting distribution rights with respect to any such New Porcine Product in the Wound
Care Field to any unaffiliated third party, Licensee shall have a right of first refusal with
respect to such distribution rights as provided in Section 1D(iii) below.
(iii) Unless Licensee’s right of first refusal hereunder has been waived pursuant to the last
sentence of Section 1D(i) above, the Licensor shall, prior to entering into any agreement with an
unaffiliated third party granting to such party distribution rights with respect to a New Porcine
Product in the Wound Care Field, deliver a written notice to the Licensee setting forth in
reasonable detail the terms and conditions of the proposed agreement with such third party and
offering to enter into a distribution agreement with Licensee on substantially the same terms and
conditions (the “ROFR Notice”). If the Licensee desires to accept such offer, it must deliver
written notice of acceptance to Licensor within 30 days following its receipt of the ROFR Notice.
If Licensee delivers notice of acceptance of such offer within the
prescribed 30 day period, the
Licensor and the Licensee shall enter into a distribution agreement on substantially the same terms
and conditions set forth in the ROFR Notice. If Licensee declines such offer or fails to deliver
written notice of acceptance within the prescribed 30 days period, then Licensee’s right of first
refusal hereunder shall be deemed to have been waived and Licensor shall have the right thereafter
to proceed with and enter into a distribution agreement with any unaffiliated third party with
respect to the subject New Porcine Product in the Wound Care Field on terms and conditions no less
favorable to such third party than those described in the ROFR Notice. If at any time subsequent
to Licensee’s rejection of or failure to accept such offer Licensor proposes to enter into a
distribution agreement with an unaffiliated third party with respect to the subject New Porcine
Product in the Wound Care Field on terms and conditions more favorable to such third party than
those set forth in the ROFR
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Notice, Licensor shall be required to offer such more favorable terms and conditions to
Licensee in accordance with the provisions of this paragraph.
For the avoidance of doubt, should Licensee waive its right of first refusal as set forth
above during the Exclusion Period, the restriction against Licensor commercializing, or permitting,
licensing, or authorizing a third party to commercialize, any new products based on the WMT Porcine
Platform that are specifically indicated for the Wound Care Field to the hospital market shall
continue in full force and effect through the Exclusion Period.
2. Ownership of the Licensed Marks. Licensee acknowledges that Licensor is the owner of
the Licensed Marks and of the goodwill associated therewith, and that Licensee has acquired and
will acquire no right, title, interest or claim of ownership in or to the Licensed Marks, apart
from the specific license granted herein. All use of the Licensed Marks by Licensee including any
goodwill in connection with the Licensed Marks shall inure to the benefit of Licensor.
3. Quality Standards for Licensed Marks. Licensor shall have the right to exercise
commercially reasonable quality control over Licensee’s use of the Licensed Marks to protect the
goodwill associated with the Licensed Marks. Licensee shall use commercially reasonable efforts to
ensure that all Licensed Goods bearing the Licensed Marks (i) shall be of a standard of quality
that is no less than the standard of quality of Licensed Goods offered by Licensee in the Wound
Care Field as of the date of execution of this Agreement, and (ii) comply with all legal
requirements applicable thereto. Any and all usage of the Licensed Marks by Licensee shall comply
with the trademark usage guidelines and requirements attached hereto as Exhibit B, which may not be
modified or supplemented by the Licensor without the prior written approval of Licensee, unless
required by law to preserve the Licensed Marks or Licensor’s rights therein (the “Usage
Guidelines”). Upon the request of Licensee, Licensor shall use commercially reasonable efforts to
register with the United States Patent and Trademark Office any representation of the Licensed
Marks or derivative or compound thereof which is created by Licensee and consistent with the Usage
Guidelines (the “Derivative Marks”), provided that Licensee pays or reimburses Licensor (at
Licensor’s option) for all costs and expenses thereof, each of which shall be licensed under this
Agreement pursuant to Section 1. Any and all use of the Licensed Marks, in any representation,
form or format, shall inure to Licensor’s benefit, and shall be the sole property of the Licensor;
provided, however, that Licensor shall not have any right to use, license, or exercise any rights
under the Derivative Marks during the term of this Agreement in the Wound Care Field. Licensee
shall use commercially reasonable efforts to maintain or enhance the quality, style and
presentation associated with the Licensed Marks. Licensee shall comply with all notice and marking
requirements of any law or regulation applicable to its use of the Licensed Marks.
4. Marketing/Training Support and Sales Data. Licensor shall, during the period from the
Effective Date through December 31, 2011 (the “Transition Period”), use commercially reasonable
efforts to transition sales activity associated with products branded with the Licensed Marks in
the Wound Care Field to Licensee, as more particularly described in Exhibit D attached hereto and
incorporated herein for all purposes. During the Transition Period, Licensor and Licensee shall
collaborate on sales activity for products branded with the Licensed Marks in the Wound Care Field
with a view toward transitioning Licensor’s customers of products branded with the Licensed Marks
in the Wound Care Field to Licensee. Such collaboration shall not prevent: (i) either party from
independently making sales during the period from the Effective Date through [***] (the
“Wind Down Period”); or (ii) Licensee from independently making sales for the remainder of the
Transition Period and thereafter. Licensor makes no representations or warranties that any of its
customers will transition to Licensee. Licensor will have no obligation to Licensee if any or all
of such customers elect not to do so. For avoidance of doubt, Licensor may continue to make sales
of products branded with the Licensed Marks in the Wound Care Field during the Wind Down Period;
provided, however, that Licensor may not sell any products branded with the
| [***] | Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment. |
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Licensed Marks in the Wound Care Field to any new customers or accounts after the [***] following the Effective Date. Following the [***] after the Effective Date,
Licensor agrees to promptly communicate any new customer and sales leads to Licensee for human soft
tissue graft containment products in the Wound Care Field. Except as set forth in Section 1B,
after [***], Licensor shall not, and shall not authorize its distributors to, promote,
market, solicit or participate in any sales of soft tissue graft containment products, whether
branded with the Licensed Marks or otherwise, in the Wound Care Field, and shall not call on
podiatrists or wound care centers in connection with any sales of products branded with the
Licensed Marks for use in the Wound Care Field. For the avoidance of doubt, Licensor shall cease
selling the product SKUs identified in Exhibit C and Licensor shall not knowingly sell any [***]
product SKUs in the Wound Care Field, except as set forth in Section 1B.
Licensor agrees to provide Licensee with copies of all materials and data in its possession
associated with the use of products branded with the Licensed Marks in the Wound Care Field
according to the transition plan set forth in Exhibit D, and shall cease all use of such materials
in the Wound Care Field on or before [***]. Any updates to such materials created by
Licensor during the Transition Period shall be promptly provided to Licensee upon creation. All
rights to use, copy, distribute, and create derivative works of such materials and data in the
Wound Care Field are hereby assigned by Licensor to Licensee.
5. License Payment/Milestone.
A. In further consideration for the licensed rights granted herein and the Licensor’s
agreement to perform its transition related obligations set forth in Section 4 hereof, the parties
agree that Licensee shall pay $8,500,000.00 (U.S. Dollars) to Licensor by wire transfer of
immediately available funds to an account designated by Licensor as follows:
(i)
$5,500,000.00 (U.S. Dollars) shall be paid to the Licensor on the Effective Date; and
(ii)
$3,000,000.00 (U.S. Dollars) on the one year anniversary of the Effective Date, provided
Licensor does not breach its obligations under this Agreement in any material respect and
fail to remedy such breach within thirty (30) days after written notice thereof from
Licensee specifying in reasonable detail the nature of the alleged breach, or if such breach
cannot reasonably be remedied within thirty (30) days, as soon as practical, so long as
Licensor is diligently pursuing such remedy.
B. Further, Licensee shall make an additional license payment to Licensor of $[***] (U.S.
Dollars) if Licensee achieves annual sales of Licensed Goods that Licensee brands with the Licensed
Marks representing Gross Revenue (as defined in Section 6) in the amount of $[***] (U.S. Dollars)
during [***], which amount shall be paid to the Licensor on or before February 1,
[***], by wire transfer of immediately available funds to an account designated by Licensor.
6. Royalty.
A. In further consideration for the licensed rights granted herein, the parties agree that
Licensee shall make the following royalty payments to Licensor for Licensee’s use of the Licensed
Marks. In each case, the royalty for any period shall be calculated based on Gross Revenue (as
defined below) from sales made by Licensee or its affiliates during such period of Licensed Goods
that Licensee brands
| [***] | Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment. |
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with one or more of the Licensed Marks:
| (i) | [***]% of Gross Revenue during the calendar years 2011 through 2015; | ||
| (ii) | [***]% of Gross Revenue in the calendar year 2016; | ||
| (iii) | [***]% of Gross Revenue in the calendar year 2017; | ||
| (iv) | [***]% of Gross Revenue in the calendar year 2018; | ||
| (v) | [***]% of Gross Revenue in the calendar year 2019 through the term of the Agreement. |
As used herein, Gross Revenue means the gross sales price of Licensed Goods invoiced by
Licensee or its affiliates to the purchasers of such of Licensed Goods, less the following amounts
to the extent appropriately documented and actually paid out by Licensee or credited against the
amounts received by Licensee in connection therewith: (1) royalties required to be paid by Licensee
to unaffiliated third parties in connection with intellectual property rights in the subject
Licensed Goods licensed by Licensee pursuant to a written license agreement between Licensee and
such unaffiliated third party; (2) industry standard discounts, rebates and deductions actually
given to customers (including group purchasing organizations) based on volumes and/or revenues
commercialized, or any other deductions or the like allowed to wholesalers or distributors or to
other customers for quantity purchases, prompt payments or other industry standard special
conditions; (3) credits, allowances or refunds actually allowed or taken, not exceeding the
original invoice amount, for returned or deficient goods or services, in each case only to the
extent reasonable and standard in the industry; (4) transportation expenses, including any and all
carriage or insurance charges, packaging, freight, and costs of delivery, to the extent separately
identified on the applicable invoice and actually paid by the purchaser; and (5) sales and use
taxes and other fees or taxes imposed by any government or governmental agency, including, but not
limited to any import, export or customs duties but excluding any taxes on the income of Licensee,
in each case to the extent separately identified on the applicable invoice and actually paid by the
purchaser. For purposes of calculating royalties due hereunder, sales will be deemed to have been
made on the date of invoice..
B. Royalties shall be due and payable on a quarterly basis within forty-five (45) days after
the last day of each calendar quarter, based on the Gross Revenue for Licensed Goods invoiced by
Licensee during the applicable period. With each royalty payment, the Licensee shall deliver to
the Licensor a full, accurate and detailed written accounting showing the sales (by customer) on
which the royalty payment for the subject period was based, and such other information as Licensee
may reasonably require to calculate or verify the amount of royalties due to it hereunder.
C. The Licensee shall maintain complete and accurate books and records with respect to all
sales for which royalties are due hereunder in sufficient detail to enable the Licensor to compute
and verify such royalties. The Licensor or its representative or agent shall have the right, at
Licensor’s own expense but no more than once during any twelve-month period, to examine and copy,
upon not less than three (3) business days prior written notice and during normal business hours,
such books and records for the purpose of verifying Licensee’s compliance with the provisions of
this Section. In the event that any such audit reveals that Licensee failed to pay any amount due
hereunder, Licensee shall promptly pay Licensor the full amount of such shortfall. If such audit
reveals an underpayment by Licensee of more than, five percent (5%) for the period under audit,
Licensee will also reimburse Licensor for the reasonable out-of-pocket costs of such audit.
| [***] | Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment. |
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D. Notwithstanding the foregoing, Licensee may terminate its obligation to pay royalties
pursuant to this Section 6 if Licensor breaches in any material respect its obligations under
Section 1B above and fails to remedy such material breach within thirty (30) days after written
notice thereof from the Licensee describing in reasonable detail the nature of the alleged breach,
which termination will be effective upon Licensee’s giving written notice thereof after said thirty
(30) day cure period while such breach is continuing. For avoidance of doubt, Licensee’s
termination of its obligation to pay royalties pursuant to this paragraph will not operate as a
termination of Licensee’s license to use the Licensed Marks hereunder or any other provision of
this Agreement.
7. Warranties.
A. Licensor represents and warrants that it is the sole and exclusive owner of the Licensed
Marks and that, to its knowledge, any registration of the Licensed Marks is valid and
subsisting. Licensor represents and warrants that Licensee’s use of the Licensed Marks as
permitted under this Agreement will not infringe the rights of any third party. Licensor
represents and warrants that it has the authority to enter into this Agreement, license the
rights granted hereunder, and to otherwise perform its obligations hereunder, and Licensor’s
entry into this Agreement or performance of obligations hereunder is not in violation of any
agreement or other instrument to which it is a party or by which it may be bound. Licensor
further warrants that no consent from any third party is necessary for Licensee to license
the rights granted hereunder or use the materials provided by Licensor pursuant to Section
4.
B. Licensee represents and warrants that it has the authority to enter into this Agreement
and to perform its obligations hereunder, and Licensee’s entry into this Agreement or
performance of its obligations hereunder is not in violation of any agreement or other
instrument to which it is a party or by which it may be bound.
C. Licensor represents and warrants that, as of the date of this Agreement: (i) the clinical
study that supports reimbursement of Licensor’s soft tissue graft containment products sold
by Licensor as of the Effective Date, in the Wound Care Field does not rely upon fraudulent
data; and (ii) the submissions made to third parties by Licensor to obtain reimbursement for
Licensor’s soft tissue graft containment products sold by Licensor as of the Effective Date,
in the Wound Care Field do not contain any misstatements of a material nature, in either
case in such a manner or to such an extent that would cause Medicare or private insurers to
discontinue reimbursement for purchases of Licensed Goods. The sole and exclusive remedy
for breach of this warranty shall be for Licensor to provide reasonable assistance to
Licensee to remedy the breach, but in no event shall such reasonable
assistance exceed Five Hundred Thousand and 00/100 Dollars ($500,000)
in the aggregate for all such breaches.
8. Assignment.
Licensee may not assign, transfer, or otherwise dispose of any of its rights or obligations under
this Agreement, by operation of law or otherwise, without the prior written consent of Licensor;
provided, however, that Licensee (A) may freely assign this Agreement to a current or future
“Affiliate” (as hereinafter defined), provided that Licensee will remain jointly and severally
liable for any breach of this Agreement by such Affiliate following any such assignment; and (B)
may assign this Agreement to and have this Agreement assumed by an unaffiliated acquirer or
successor of Licensee in connection with a merger, acquisition, reorganization or restructuring of
the Licensee, or sale by the Licensee of substantially all assets related to this Agreement. As
used herein, the term “Affiliate” means, with respect
| [***] | Indicates portions of this exhibit that have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment. |
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to any specified person or entity at any time, any person or entity who is directly or indirectly
controlling, controlled by or under common control with such specified person or entity at such
time.
9. Confidential Information.
A. Definition. Licensor and Licensee may from time to time provide to the other party
(each, a “Recipient”) certain advice, technical information, know-how and other proprietary data
and information that they respectively own to aid each other in the performance of their respective
obligations under this Agreement. Inasmuch as various of these materials and advice may contain
confidential information and/or trade secrets (all of which will be referred to herein as the
“Confidential Information”), it is hereby agreed that any Confidential Information which is
disclosed by one party to the other is valuable, proprietary property belonging to the party making
such disclosure, and the Recipient agrees that it will neither use nor disclose any Confidential
Information to any third party (except if necessary in the performance of its duties hereunder),
except with the prior written consent of the other party, provided, however, that any written
Confidential Information shall be marked “Confidential”. Information and materials assigned and
provided by Licensor to Licensee under Section 4 shall be deemed to be Confidential Information of
Licensee.
B. Limitation. The Recipient agrees to make copies of that Confidential Information
received by the Recipient as is authorized by the other party and which is necessary to the
performance of Recipient’s obligations under this Agreement. Recipient also agrees to limit
disclosure of the Confidential Information to only those employees of Recipient with a need to know
such Confidential Information in connection with the performance of Recipient’s obligations under
this Agreement.
C. Exclusions. Notwithstanding any other provision in this Section, the term
“Confidential Information” does not include information which (i) came into the Recipient’s
possession prior to execution of this Agreement, provided that such information is not known by the
Recipient to be subject to another confidentiality agreement with or other obligation of secrecy to
the other party, or (ii) becomes generally available to the public other than as a result of a
disclosure by the Recipient or any of the Recipient’s directors, officers, employees, agents or
advisors, or (iii) becomes available to the Recipient on a non-confidential basis from a source
other than the other party or the other party’s advisors, provided that such source is not bound by
a confidentiality agreement with or other obligation of secrecy to the other party; or (iv) was
independently developed by the Recipient without reference to or use of any Confidential
Information of the other party.
10. Termination.
A. The Licensor shall have the right, effective upon the giving of written notice of
termination to the Licensee, to terminate this agreement and the rights and license granted to
Licensee hereunder in any of the following events:
| (i) | if the Licensee breaches this Agreement in any material respect, and fails to remedy such breach within thirty (30) days after written notice thereof from the Licensor specifying in reasonable detail the nature of the alleged breach, or, in the event that such breach cannot reasonably be remedied within thirty (30) days, as soon as practical, so long as Licensee is diligently pursuing such remedy, and solely provided that Licensor first goes through the resolution procedure set forth in Section 10.D; or | ||
| (ii) | (a) solely provided LifeCell Corporation and Licensee remain Affiliates, if LifeCell Corporation (or any successor to LifeCell Corporation’s rights and obligations under the Supply Agreement that is an Affiliate of Licensee): |
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| (1) | materially and intentionally breaches Section 3.1(i) (Exclusivity) of the Supply Agreement, and fails to remedy such material breach within thirty (30) days after written notice thereof from the Licensor specifying in reasonable detail the nature of the alleged material breach, or, in the event that such breach cannot reasonably be remedied within thirty (30) days, as soon as practical, so long as Licensee is diligently pursuing such remedy, as each of the foregoing is determined by final judgment of an arbitrator pursuant to Section 17 of the Supply Agreement which is no longer subject to appeal, and provided that Licensor first goes through the resolution procedure set forth in Section 10.D; or | ||
| (2) | intentionally and materially breaches its obligation to supply Product (as defined in the Supply Agreement) to Licensor in accordance with the Supply Agreement on a repeated or continuing basis, and fails to remedy such breach within thirty (30) days after written notice thereof, or, in the event that such breach cannot reasonably be remedied within thirty (30) days, as soon as practical, so long as Licensee is diligently pursuing such remedy, as each of the foregoing is determined by final judgment of an arbitrator pursuant to Section 17 of the Supply Agreement which is no longer subject to appeal and provided that Licensor first goes through the resolution procedure set forth in Section 10.D (provided, however, that Licensor shall not be entitled to terminate this Agreement pursuant to this Section 10A(i)(2) if the reason for LifeCell Corporation’s failure to supply Product is due to a significant interruption in its production activities which is the result of causes that are beyond LifeCell’s reasonable control (e.g. unavailability of raw materials or regulatory intervention) and Licensor’s supply of Products is not impacted any worse than any other customer of LifeCell purchasing comparable products). |
B. The Licensee shall have the right, effective upon the giving of written notice of
termination to the Licensor, to terminate this agreement in any of the following events:
| (i) | if the Licensor breaches this Agreement in any material respect, and fails to remedy such breach within thirty (30) days after written notice thereof from the Licensee specifying in reasonable detail the nature of the alleged breach, or, in the event that such breach cannot reasonably be remedied within thirty (30) days, as soon as practical, so long as Licensee is diligently pursuing such remedy, and solely provided that Licensee first goes through the resolution procedure set forth in Section 10.D. |
C. Upon termination of this Agreement, all rights and licenses granted to the Licensee
pursuant to this Agreement and all other rights and obligations of the parties shall terminate,
except that: (i) the parties shall not be relieved of any obligations accruing before the effective
date of termination, and (ii) the rights and obligations of the parties under Sections 2, 5, 6C, 9,
10C, 11, 12 and 13 will survive the termination or expiration of this Agreement in accordance with
their respective terms.
D. If either party believes the other party has breached this Agreement or if a dispute
otherwise arises under this Agreement, a party may deliver a written notice of a dispute to the
other party. If such dispute has not been resolved within thirty (30) days of receipt of such
written notice, an executive of each party shall meet in person at the facilities of the party
receiving such written notice in an attempt to resolve such dispute. If such dispute is not
resolved within a further thirty (30) days, the chief executive officer of each party shall meet in
person at the facilities of the party delivering such notice in a further attempt to resolve such
dispute. If such dispute remains unresolved for a further thirty (30) days, the non-breaching
party may terminate this Agreement pursuant to this Section 10.
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11. Indemnification.
A. By Licensor. Licensor shall indemnify, defend and hold harmless Licensee and its
subsidiaries and affiliates and each of their respective directors, officers, employees and agents
for, from and against all claims, demands, actions, suits, proceedings, losses, damages,
liabilities, costs and expenses (including but not limited to reasonable attorneys’ fees) arising
out any breach of a warranty hereunder or any product bearing a Licensed Xxxx that is sold or
distributed by Licensor or its affiliates, including but not limited to any failure of such product
to comply with applicable laws or regulations, or from bodily injury, personal injury or product
liability claims resulting from the use of such product, excluding only any claims caused by the
Licensee.
B. By Licensee. Licensee shall indemnify, defend and hold harmless Licensor and its
subsidiaries and affiliates and each of their respective directors, officers, employees and agents
for, from and against all claims, demands, actions, suits, proceedings, losses, damages,
liabilities, costs and expenses (including but not limited to reasonable attorneys’ fees) arising
out any product bearing a Licensed Xxxx that is sold or distributed by Licensee or its affiliates,
including but not limited to any failure of such product to comply with applicable laws or
regulations, or from bodily injury, personal injury or product liability claims resulting from the
use of such product, excluding only (i) any third party claims that any use by Licensee of the
Licensed Marks in accordance with the provisions of this Agreement violates or infringes such third
party’s rights; or (ii) any claims caused by the Licensor.
C. Indemnification Procedures. The indemnified party shall provide the indemnifying party
with prompt written notice upon becoming aware of any claim subject to indemnification hereunder,
and shall provide reasonable cooperation to the indemnifying party in the defense of such claim;
provided that no failure or delay in providing the notice referred to above shall relieve the
indemnifying party of its indemnification obligations hereunder unless (and then only to the extent
that) the indemnified party is prejudiced thereby. So long as the indemnifying party is diligently
defending such claim, the indemnifying party shall have the right, through counsel of its choice,
to control the investigation and defense of such claim, and shall have sole authority to defend
and/or settle or compromise such claim at its expense and discretion; provided, however, that any
settlement of such a claim by the indemnifying party which does not include an unconditional
release of the indemnified party must be approved by the indemnified party (which approval shall
not to be unreasonably withheld or delayed). The indemnified party may participate in the defense
and/or settlement of any such claim at its own expense using counsel of its own choosing; provided,
however, that so long as the indemnifying is diligently defending such claim the indemnified party
shall not make or enter into any compromise or settlement of said claim without prior written
consent of the indemnifying party, which consent shall not be unreasonably withheld or delayed.
12. Arbitration.
A. Agreement. Any dispute, controversy, claim or other matter in question between the
parties hereto arising out of or relating to this Agreement or any other document or instrument
executed by the parties hereto in connection with this Agreement contemplated in any of the
foregoing, including all issues of fact and law (for the purposes of this Section, the “Claim”),
shall be settled by arbitration in accordance with the Commercial Arbitration Rules of the American
Arbitration Association (the “Commercial Arbitration Rules”), except as otherwise expressly set
forth herein. Without limiting the generality of the foregoing, “Claims” shall also include any
dispute, controversy, claim or other matter in question arising out of or related to this Agreement
or any document or instrument executed by the parties hereto in connection herewith, it being the
purpose and intent hereof to evidence the agreement of all the parties hereto to submit all Claims
to arbitration. Notice of demand for arbitration shall be filed in writing with all parties to
this Agreement as to whom the Claim is alleged and with the American Arbitration Association (the
“AAA”). The arbitration proceeding shall be conducted by one disinterested
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neutral arbitrator who shall be appointed from a panel in accordance with the Commercial
Arbitration Rules of the AAA; provided, however, that if a neutral arbitrator cannot be selected
and appointed by the parties to the dispute from the first list of names submitted by the AAA, then
the AAA shall submit to each party to the dispute a second list of names of persons chosen from the
panel, and if a neutral disinterested arbitrator cannot be appointed for any reason from said
second list, then the AAA shall then be deemed authorized and directed to and shall select and
appoint, on behalf of all parties to the dispute, one disinterested neutral arbitrator (but in no
event shall the AAA appoint an arbitrator whose name has previously been rejected by the parties to
the dispute). All persons submitted as prospective arbitrators by the AAA shall be persons having
substantial knowledge of substantive commercial laws and the general issues in question for
arbitration.
B. Proceedings. The arbitrator shall conduct the arbitration proceeding in the State
of New Jersey if the Licensor initiates the dispute and in Memphis, Tennessee if Licensee initiates
the dispute, as provided hereinabove and in the Commercial Arbitration Rules. The arbitrator
rendering the judgment or award shall deliver a brief written opinion explaining such judgment or
award and the legal and factual reasons therefor. This agreement to arbitrate shall be
specifically enforceable under applicable law in any court having jurisdiction thereof. The award
rendered by the arbitrator shall be final, such judgment shall be entered upon it in accordance
with applicable law in a court hearing jurisdiction thereof and any such award or judgment shall be
subject to appeal in accordance with the same procedures and an the same legal basis as a final
judgment of the trial court in which such judgment is entered. The parties hereto agree to
expedite and cooperate in obtaining the entry of judgment with respect to such award. A demand for
arbitration shall be made within a reasonable time after the Claim or other matter in question has
arisen. In no event shall the demand for arbitration be made after the date when institution of
legal or equitable proceedings based on such Claim or the matter would be barred by applicable
statutes of limitation.
13. General.
A. Amendment, Modification and Waiver. The failure of either party to enforce its
rights or to require performance by the other party of any term or condition of this
Agreement shall not be construed as a waiver of such rights or of its right to require
future performance of that term or condition. Any amendment of modification of this
Agreement or any waiver of any breach of any term or condition of this Agreement must be in
a writing signed by both parties in order to be effective. Unless expressly provided
therein, a waiver of any breach of any term or condition of this Agreement shall not be
construed as a waiver of any continuing or subsequent breach of such term or condition, or a
waiver of any other right under this Agreement.
B. Governing Law. This Agreement and all matters arising directly and indirectly
from this Agreement (collectively “Agreement Matters”) shall be governed and interpreted
under the laws of the State of Delaware and the United States without regard to the
conflicts of laws provisions thereof. Subject to the provisions of Section 12 hereof, the
parties hereby irrevocably submit to the exclusive personal jurisdiction of the State and
Federal courts located in Delaware for the purpose of any suit, action, proceeding or
judgment which, directly or indirectly, arises out of any Agreement Matters; provided that a
party to this Agreement shall be entitled to enforce an order or judgment of a Delaware
court (or a federal appellate court of competent jurisdiction issuing the same on appeal
from a Delaware court) in any other court having jurisdiction over the other party hereto.
Each of the parties hereby irrevocably waives, to the fullest extent permitted by applicable
law, any objection that it may now or hereafter have to the laying of the venue of any such
proceeding brought in such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum.
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C. Headings. Headings and captions are for convenience of reference only and shall
not be deemed to interpret, supersede or modify any provisions of this Agreement.
D. Severability. In the event that any provision of this Agreement shall be
determined by a court of competent jurisdiction to be illegal or unenforceable, that
provision will be limited or eliminated to minimum extent necessary so that this Agreement
shall otherwise remain in full force and effect and enforceable.
E. Entire Agreement. Upon execution by both parties, this Agreement and the
attached Exhibits shall constitute the entire agreement between the parties with respect to
the subject matter hereof and supersede all discussions, negotiations, agreements and past
dealings, either oral or written, between or among the parties relating to the subject
matter hereof.
F. Nonexclusive Remedies. The rights and remedies of a party set forth herein are
not exclusive, the exercise thereof shall not constitute an election of remedies and the
aggrieved party shall in all events be entitled to seek whatever additional remedies may be
available in law or in equity.
G. Counterparts; Evidence of Signatures. For the convenience of the parties, any
number of counterparts of this License Agreement may be executed, and each such counterpart
shall be deemed to be an original instrument. Signatures transmitted by facsimile or
electronic mail (including, without limitation, electronic mailing of a so-called portable
document format or “pdf” of a scanned counterpart) shall be treated as and deemed to be
original signatures for all purposes, and will have the same binding effect as if they were
original, signed instruments delivered in person
H. Notices. Any notice, transmittal of documents, correspondence or other
communication between the parties to this Agreement required or permitted hereunder shall be
in writing, addressed to the party to whom sent and transmitted by certified mail, courier
or by facsimile with signed written original to follow by certified mail or courier. All
such notices in compliance with this provision shall be deemed received by the other party
on the next business day after transmission. For purposes of this Agreement, the addresses
of the parties are as follows until changed by written notice from the party desiring to
change its address to the other party.
If to Licensee:
|
If to Licensor: | |
KCI Medical Resources
|
Xxxxxx Medical Technology, Xxx.Xxxxxx Xxxxx, | |
Xxxx Xxxxxx
|
0000 Xxxxxxx Xxxx X.X. Xxx 000 XX | |
| Xxxxxxxxx, XX 00000 Grand Cayman, Cayman | ||
Islands
|
Attn: President Attn: Legal Department | |
| Telephone: 000-000-0000 Facsimile: 000-000-0000 | ||
With a copy to: |
||
KCI USA, Inc.
|
Xxxxxx Medical Technology, Inc.Vantage Way 5677 Airline Road |
|
San Antonio, TX
|
Arlington: TN 38002 | |
Attn: President
|
Attn: General Counsel | |
Telephone:
|
Telephone: 000-000-0000 | |
Facsimile:
|
Facsimile: 000-000-0000 |
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IN WITNESS WHEREOF, the parties hereto have each caused this Trademark License Agreement to be
executed by their authorized representatives as of the Effective Date.
| Xxxxxx Medical Technology, Inc. | KCI Medical Resources | |||||||
By:
|
/s/ Xxxx X. Xxxxxx | By: | /s/ Adriano Cito | |||||
Printed Name: Xxxx X. Xxxxxx
|
Printed Name: Adriano Cito | |||||||
Title
|
CEO | Title | Vice President, Finance | |||||
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EXHIBIT A
| Trademark | Application/Registration No. | |
| GRAFTJACKET | 2,765,465 | |
| GRAFTJACKET XENO | 77192169 | |
| GRAFTJACKET XPRESS |
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EXHIBIT B
Trademark Usage Guidelines
1. For purposes of these Usage Guidelines, Licensed Marks are defined in accordance with the
License Agreement and shown on Exhibit A.
2. Wherever possible, the Licensed Marks shall be used as adjectives. The Licensed Marks must
not be used as nouns, verbs, or any other form.
3. The following are examples of correct and incorrect trademark use:
Never use a Licensed Xxxx as a noun:
Wrong: The GRAFTJACKET™ is used for human implantation
Correct: GRAFTJACKET™ biological tissue for human implantation
Correct: GRAFTJACKET™ biological tissue for human implantation
Never use a Licensed Xxxx in the possessive form:
Wrong: GRAFTJACKET’s™ biological tissue replacement function
Correct: GRAFTJACKET™ biological tissue’s replacement function
For avoidance of doubt, Licensee may compound a trademark with another term or use it to
coin another word or phrase.
Licensee is permitted to use the Licensed Marks in varying forms, formats, colors,
stylizations, and with designs or logos, provided that any such variant of the Licensed
Marks does not constitute a mutilation of any Licensed Xxxx.
4. Use the Generic Description in Association with the Trademark
The generic product name should ALWAYS be used with the trademark, which is the name applied
to the class of products or services identified by the trademark. For example, the owners
of the KLEENEX trademark always refer to it as KLEENEX brand facial tissues or KLEENEX
facial tissues, with facial tissues being the generic product name.
In printed matter of all types, particularly in advertising copy, the generic name should
accompany the first or most prominent use of each xxxx on each page, and should usually
appear in all lower case letters. The generic name need not be used every time the
trademark appears, but it should be used often enough to make it obvious that the trademark
is not the generic name.
The following are rules of thumb to follow for using the generic product name when placing a
trademark on a product or using the trademark in any type of print or electronic materials:
a) On the product or in connection with the services. When a trademark is applied directly
to a product, or to print or electronic materials advertising a service, the generic name
should always be placed after the trademark. In certain situations, such as if the
appearance of the product conveys its own generic description, the generic name need not be
placed on the product.
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For example, use of the trademark “Cadillac” on a car does not require the generic product
name “car” after the trademark, as it is clear the xxxx is being used on a car.
b) In print and electronic materials. Here, it is very important to use the generic product
or service name with a trademark, since using only the trademark will not clearly convey the
generic product or service name. The generic product or service name should accompany the
first or most prominent use of each xxxx on each print or electronic page, and should
usually appear in all lower case letters. The generic name need not be used every time the
trademark appears, but it should be used often enough to make it obvious that the trademark
is not the generic name.
5. Proper Notice of Trademarks in the U.S.
Whether a trademark has been registered or not, proper marking is essential to protect
valuable rights in the marks. Without such notice, some of these valuable rights may not be
enforceable.
Federally Registered Trademarks®
One of the following forms of notice should be used if a trademark is federally registered:
| • | The statutory symbol ® placed on the “shoulder” or the “heel” of the trademark, as in: |
| GRAFTJACKET® | GRAFTJACKET® |
Alternatively, an asterisk or footnote placed on the shoulder of the trademark with a footnote
reading “Registered in the U.S. Patent and Trademark Office” or “Reg. U.S. Xxx. & Tm. Off.”
NOTE: NEVER USE THE SYMBOL ® WITH AN UNREGISTERED TRADEMARK OR WITH A TRADEMARK WHERE
FEDERAL REGISTRATION HAS BEEN REQUESTED BUT NOT YET GRANTED.
| • | A notation that the trademark is owned by Xxxxxx Medical Technology, Inc., as in “GRAFTJACKET is a Xxxxxx Medical Technology, Inc. Trademark” or “The GRAFTJACKET trademark is a registered trademark of Xxxxxx Medical Technology, Inc.” |
Place the notation on the page where the trademark appears or at the front or back of a
brochure.
Common Law Xxxx or Xxxx Pending at the Trademark Office
TM or SM
If a trademark is being used and has not been federally registered, one of the following
forms of notice should be used:
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| • | The initials “TM” or “SM” on the shoulder or heel of each xxxx. The “TM” symbol is used to identify tangible goods, where as the “SM” symbol is used to identify intangible services. |
| • | A notation that Xxxxxx Medical Technology, Inc. claims trademark rights, as in “The GRAFTJACKET ZENO trademark is a trademark of Xxxxxx Medical Technology, Inc.” or “The GRAFTJACKET XPRESS trademark is a trademark of Xxxxxx Medical Technology, Inc.,” etc. Place this notation in the same location as for registered trademarks. |
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EXHIBIT C
Product SKUs
| LifeCell SKU | Description | WMT SKU | ||
| 663002 | GRAFTJACKET XPRESS, 2CC | 86GL2000 | ||
| 702032 | GRAFTJACKET, Ulcer Repair, 4x8 cm, ..38-1.02 (mm) | 86TM4X08 | ||
| 712016 | GRAFTJACKET, Ulcer Repair, 4x4 cm, ..38-.76 (mm) | 86TM4X4S |
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EXHIBIT D
Transition Plan
Licensor shall use commercially reasonable efforts to complete the following tasks by the dates set
forth below:
By January 31, 2011
Transfer to KCI priority marketing, training, reimbursement, and other transition materials of the
following types:
A. Marketing materials;
B. Available primary and secondary market research conducted or analyzed;
C. Promotional and scientific marketing materials including, but not limited to, the transfer of
complete files from any promotion agency for Licensor’s assets, copy of the pivotal DFU study
article from the Intl Wound Journal, spreadsheet with raw data from the pivotal DFU study and
report with graphs and analyses that were performed in preparation of the Intl Wound Journal
manuscript, all web assets and materials, and all KOL contacts;
D. Electronic and print training materials including, but not limited to, training presentation,
documents hosted by a third party, application videos and similar materials;
E. Summary institutional and product performance tracking data including, but not limited to, sales
force targeting information and ICD-9 information; (i.e. performance reports of overall wound line,
coverage vs. non-coverage areas, etc.)
F. Information relating to the method or manner in which the Licensed Goods are distributed by
Licensor; and
G. A comprehensive overview of Licensor’s reimbursement programs for their products branded with
the Licensed Marks in the Wound Care Field, including information regarding the coverage of such
products under Medicare. All non-privileged materials associated with reimbursement programs to be
transferred.
H. Initiate transfer of branding assets and website assets to KCI, including proper introduction
and directive to relevant vendors to transition assets.
I. WMT to cease all medical education and promotional efforts at medical meetings and cease
promotion in medical journals related to wound applications of GraftJacket products.
By March 15, 2011
Introduce KCI to current KOLs for GraftJacket wound applications.
Complete transfer of all items, in addition to priority materials, related to topics included in A
— I above.
Provide to KCI a complete customer list, excluding the Top 150 WMT Accounts, of past and current
customers of products branded with the Licensed Marks in the Wound Care Field, together with
contact names where available, facility locations, purchase history, average selling price (current
and in the past) at which Licensor or its distributors sell Products to various facilities, and
other customer data associated with such customers that are maintained by Licensor in the normal
course of business.
Develop & send formal announcement letter from WMT to all accounts, excluding the Top 150 WMT
Accounts, providing introduction of KCI as new sales channel for all wound sales of GraftJacket
product and introducing KCI sales reps to relevant personnel (e.g., Surgeons, purchasing
department, etc) at Xxxxxx wound care accounts. KCI to review proposed letters to accounts and
receive copies of the letters sent to WMT accounts to assist KCI representatives in communicating
change to WMT accounts.
Formal announcement letter detailing KCI — WMT partnership to be sent to all accounts, excluding
Top 150 WMT Accounts, by or on March 15, 2011.
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By April 30, 2011
Provide to KCI a complete customer list of the Top 150 WMT Accounts, of past and current customers
of products branded with the Licensed Marks in the Wound Care Field, together with contact names
where available, facility locations, purchase history, average selling price (current and in the
past) at which Licensor or its distributors sell Products to various facilities, and other customer
data associated with such customers that are maintained by Licensor in the normal course of
business.
Develop & send formal announcement letter from WMT to the Top 150 WMT Accounts, providing
introduction of KCI as new sales channel for all wound sales of GraftJacket product and introducing
KCI sales reps to relevant personnel (e.g., Surgeons, purchasing department, etc) at Xxxxxx wound
care accounts, by or on April 30, 2011. KCI to review proposed letters to accounts and receive
copies of the letters sent to WMT accounts to assist KCI representatives in communicating change to
WMT accounts.
By June 30, 2011
Remove all information relating to GraftJacket for wound applications from its website.
Through remainder of Transition Period (December 31, 2011)
Provide ongoing sales training support, reimbursement and product MAC coverage support during the
Transition Period. KCI shall provide reasonable notice when support is needed.
For the duration of the Agreement, WMT and KCI to jointly coordinate on reporting ASP details for
GraftJacket.
Exceptions
Notwithstanding the foregoing, Licensor shall not be required to deliver to KCI or provide KCI
access to any correspondence with its legal counsel or any other documents or materials provided to
or by its legal counsel which Licensor reasonably believes is subject to or qualifies for the
attorney client privilege.
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