LICENSE AGREEMENT
This Agreement, effective the 28th day of February, 1997, is by and between THE
SPECTRANETICS CORPORATION, 00 Xxxxxxxx Xxxxx, Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
("Spectranetics") and MEDTRONIC, INC. 0000 Xxxxxxx Xxx. X.X., Xxxxxxxxxxx,
Xxxxxxxxx 00000 ("Medtronic").
RECITALS
A. Medtronic has developed technology relating to laser lead extraction and
owns intellectual property related thereto.
B. Medtronic wishes to grant and Spectranetics wishes to obtain an exclusive
license to commercialize products using the Medtronic technology.
Now, therefore, the parties agree as follows:
ARTICLE 1
DEFINITIONS
The following definitions and terms shall have the designated meanings:
"Lead Extractor" means a device for aiding in removal of medical devices such as
pacing and defibrillation leads or catheters.
"Licensed Intellectual Property" means (1) All U.S. patents and patent
applications owned by or licensed to, with the right to sublicense, Medtronic
which are now or during the term of this Agreement developed for use in the
laser extraction of leads or catheters, including U.S. Patent 5,423,806
entitled "Laser Extractor for an Implanted Object" and U.S. Patent Application
08/153,715 entitled "Heart Synchronized Extractor for an Implanted Object"; (2)
all patent rights derived from such patents and patent applications, including
but not limited to foreign rights, divisionals, continuations, continuations in
part, re-issues, and reexaminations; and (3) any confidential information
provided to Spectranetics by Medtronic (a) under the terms of the Agreement for
Mutual Exchange of Confidential Information between Spectranetics and Medtronic
dated May 21, 1991 (the "Confidentiality Agreement"), (b) in written form and
marked as "proprietary", "confidential" or the like, before and during the
development of Spectranetics products, including but not limited to the original
concept drawings and information disclosures (collectively the "Medtronic
Confidential Information"). Medtronic Confidential Information shall not,
however, include information which:
(i) is or was known to Spectranetics prior to receipt thereof under this
Agreement or the Confidentiality Agreement, as evidenced by written
records;
(ii) is disclosed without restriction to Spectranetics in good faith by a
third party who is in lawful possession thereof and who has the right
to make such disclosure;
(iii) is or shall have become public knowledge, by publication or
otherwise, through no fault of Spectranetics;
(iv) is discovered by Spectranetics completely without reference to
Medtronic Confidential Information; or
(v) is transmitted to Spectranetics by Medtronic after Medtronic received
notification in writing from Spectranetics that Spectranetics did not
desire to receive any further Medtronic Confidential information.
"Net Sales" means the amounts received by Spectranetics from any third party
(not including any transactions with Medtronic) for sales of Royalty Products,
excluding sales taxes, use taxes, occupation taxes, excise taxes, freight, duty
or insurance, returns, discounts, credits, or repayments for returns. If Royalty
Products are sold packaged with products which are not Royalty Products, the Net
Sales of such products would be the number of such units multiplied by the
average net selling price for similar Royalty Products individually packaged
during the period for which the royalties are computed.
"Quarter" means each quarter of the Spectranetics fiscal year.
"Royalty Product" means any Lead Extractor covered by a claim of an unexpired
patent in the Licensed Intellectual Property or employing Medtronic Confidential
Information in the Licensed Intellectual Property; provided that the laser
generators and other capital equipment of Spectranetics will not be considered
Royalty Product. Lead Extractors sold for the purpose of clinical trials
required for obtaining government approval to market in any country shall not be
deemed Royalty Product.
ARTICLE 2
LICENSE GRANT
2.1 License
Medtronic grants to Spectranetics a worldwide, exclusive license to make, have
made, use and sell Royalty Products.
2.2 Term
Unless otherwise terminated under provisions of this Agreement, the license
granted under this Agreement shall continue until the expiration of the last
patent in the Licensed Intellectual Property in any country.
2.3 Spectranetics Intellectual Property
Except as provided in Article 6 below, no license is granted hereunder to
Medtronic in any Spectranetics intellectual property.
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ARTICLE 3
ROYALTIES AND REPORTS
3.1 License Fee
Spectranetics shall issue to Medtronic warrants for Two Hundred Thousand
(200,000) shares of its common stock. Any warrants issued under this Agreement
shall be exercisable for the longer of five years after the effective date of
this Agreement or three years after FDA permission to market Royalty Products.
The exercise price on the warrants shall be fixed at the stock closing price on
the date of execution of this Agreement.
3.2 Royalties
Spectranetics shall pay Medtronic a royalty of * of Net Sales of Royalty
Products (except for Royalty Products sold through an independent distributor,
for which the royalty shall be set at *) until the last U.S. patent expires.
After the last U.S. patent expires then the * royalty will be payable only on
sales into countries in which there are valid patents, in such country, relating
to the Royalty Products. No royalties shall be paid by Spectranetics for
Royalty Products sold to Medtronic under this Agreement.
3.3 Reports and Payments
Spectranetics shall provide Medtronic, within sixty (60) days of the end of each
Quarter, a written report indicating the amount of Net Sales, the number of
units sold and the amount of royalties due for the Quarter. At the time of the
report, Spectranetics shall pay Medtronic the reported due royalties by check or
wire transfer.
3.4 Records
Spectranetics agrees to keep accurate written records in sufficient detail to
allow Medtronic to verify Spectranetics' determinations of unit sales, Net Sales
and royalties due. These records shall be kept for at least five years following
the end of the Quarter to which they apply.
3.5 Audit of Records
Medtronic may audit the records referred to in Section 3.4, at reasonable times
and upon reasonable notice, not more than once per year. Such audit shall be at
Medtronic's expense.
* THIS PORTION MARKED WITH AN ASTERISK HAS BEEN OMITTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT AND FILED SEPARATELY WITH THE COMMISSION.
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ARTICLE 4
REGULATORY
Spectranetics shall be responsible for obtaining all regulatory approvals needed
to market Royalty Products. Spectranetics agrees to use reasonable efforts and
diligence to obtain such approvals from the FDA. All regulatory expenses shall
be the responsibility of Spectranetics. Spectranetics shall own all such
regulatory approvals, except as specified in Article 6. Medtronic shall have the
right to access and utilize such regulatory approvals, including any supplements
thereto, in connection with any distribution of Royalty Products pursuant to
Article 6 below.
ARTICLE 5
INTELLECTUAL PROPERTY
5.1 Enforcement
During the term of this license Spectranetics shall notify Medtronic of
information received by Spectranetics indicating that a third party has
infringed any patent rights or has improperly obtained or disclosed any
confidential information in the Licensed Intellectual Property. Medtronic shall
have the first opportunity to enforce rights in the Licensed Intellectual
Property. Should Spectranetics wish to enforce the Licensed Intellectual
Property it shall notify Medtronic. Medtronic shall have 120 days in which to
elect whether to enforce on its own, enforce together with Spectranetics, or
allow Spectranetics to act alone in enforcement. Should Medtronic elect not to
enforce, Spectranetics may enforce the Licensed Intellectual Property at its
sole expense and retain any award of damages, royalties or any other monetary
award to Spectranetics. If the parties agree to jointly enforce rights in the
Licensed Intellectual Property, then each party shall share in any award of
damages, royalties or any other monetary award on a prorated basis determined by
the direct expense paid by each party in enforcing such rights.
5.2 Patent Protection
Should any inventions be made jointly between personnel of the parties, the
parties shall meet to agree on whether to seek patent protection. If agreement
is reached, the parties shall divide equally the cost of filing and prosecution.
If no agreement is reached and one party wishes to proceed, the
non-participating party agrees to assign its rights to the filing party, but
shall retain a paid up nonexclusive license in any resulting patent, without
the right to sublicense.
5.3 Marking
At Medtronic's request, Spectranetics shall xxxx all Royalty Product with
numbers of Medtronic patents covering the Lead Extractor and a legend indicating
that the device is manufactured under license from Medtronic.
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ARTICLE 6
MARKETING
6.1 Cessation of production
If Spectranetics ceases producing lead extraction devices for more than one
hundred eighty (180) days for any reason, including but not limited to
bankruptcy or voluntary cessation of manufacture, Medtronic may notify
Spectranetics of its intent to terminate this license. Spectranetics shall have
30 days to cure by restarting manufacture or by making a credible argument of
its rights claiming that its performance was prevented by force majeure under
Section 10.13 of this Agreement, coupled with its plan for restarting
manufacture as soon as the force majeure is removed. If Spectranetics does not
cure within the 30 day period, Medtronic may terminate this license Agreement
and Spectranetics shall grant to Medtronic a nonexclusive, paid up license under
any Spectranetics patents or other intellectual property needed for Medtronic to
make, use or sell Lead Extractor catheters, but not laser generators. Medtronic
is granted access to any drawings, specifications or other information required
to continue the manufacture of Lead Extractor catheters. Medtronic is granted
the right to use any government approvals, such as FDA pre-market approval for
the Lead Extractor. This includes as many rights as needed to effect Medtronic
use of such approvals, including assignment of the approvals if that is legally
required. Medtronic is granted a license under such FDA, CE or other applicable
approvals sufficient to manufacture and distribute said Royalty Products,
contingent upon bankruptcy of Spectranetics. Spectranetics will assist Medtronic
in the transfer of any government approvals for the Lead Extractor.
6.2 Minimum Sales
Spectranetics shall be targeted to sell a minimum of 500 units per year
beginning one year after the grant of pre-market approval by the FDA. In each
successive year Spectranetics shall be targeted to sell a minimum of 1000 units
per year. Should Spectranetics fail to sell the targeted units in any year,
Medtronic may elect to purchase units from Spectranetics for its own
distribution at * of the average selling price in accordance with the provisions
of Sections 6.4 and 6.5 below but failure to sell targeted amounts shall not be
a breach of this Agreement for purposes of Article 9.
6.3 Worldwide Marketing
Following the initial grant of marketing rights by the FDA, for any country of
the world in which (a) Spectranetics has not submitted an application for
regulatory approval in such country within 12 months, or (b) after obtaining
that country's regulatory approvals, Spectranetics is not marketing the Lead
Extractor or has not sold 100 units in the preceding 12 months, Medtronic may
notify Spectranetics of its intent to seek such marketing rights. Unless
Spectranetics submits for the applicable regulatory approvals or begins actively
marketing within 90 days after Medtronic has so requested marketing rights for a
country, Medtronic shall have the right to
* THIS PORTION MARKED WITH AN ASTERISK HAS BEEN OMITTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT AND FILED SEPARATELY WITH THE COMMISSION.
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market in that country. The transfer price from Spectranetics to Medtronic
shall be * for lead extraction devices in that country. Medtronic shall be
responsible for obtaining regulatory approval in any country in which it
sells Lead Extractors, at Medtronic's expense. Medtronic shall own any such
approval.
6.4 Parallel Distribution
Medtronic may elect to market Lead Extractors in parallel to the distribution of
Spectranetics. This right to distribute Lead Extractors may not be exercised
until three years after approval of such Lead Extractors by the FDA. In case of
exercising its rights under this Section 6.4, Medtronic shall surrender any
unexercised warrants which have been granted under this Agreement and except as
otherwise provided pursuant to Section 6.1 above, Medtronic shall continue to
purchase catheters exclusively from Spectranetics in accordance with the
provisions of Sections 6.5, 6.6 and 6.7 below.
6.5 Transfer Price
In cases where Medtronic is to distribute Lead Extractors in parallel under
Section 6.4, the transfer price from Spectranetics shall be based on the
Spectranetics United States sales volume in the preceding twelve calendar months
as follows:
Less than * units * of Spectranetics' avg. U.S. selling price
Between * and * units * of Spectranetics' avg. U.S. selling price
Between * and * units * of Spectranetics' avg. U.S. selling price
Over * units * of Spectranetics' avg. U.S. selling price
In no event will Spectranetics be required to sell Medtronic Lead Extractors
below Spectranetics' manufacturing cost, which cost shall include, but shall not
be limited to, all material included in the product and the packaging of the
Lead Extractor product, all direct labor expended in the manufacturing and
assembly of the product, manufacturing burden which includes appropriately
allocated manufacturing supervision, manufacturing engineering support, quality,
material handling, depreciation of equipment, material procurement and
facilities, which are specific to the Lead Extractor product. These costs are
reflected in the standard cost used for inventory valuation and are audited by
independent auditors. In addition to standard cost, any direct royalty expense
associated with such Lead Extractor products will be added to standard cost in
the determination of total manufacturing cost for the purpose of determining the
minimum price of Lead Extractors to Medtronic. If Spectranetics applies
manufacturing cost to the determination of transfer price, Medtronic shall have
the right, at its expense, to have the manufacturing costs audited by an
independent auditor.
Any time before acquiring distribution rights in the United States, Medtronic
may purchase Lead Extractors from Spectranetics for * of the Spectranetics
average selling price. Medtronic may not
* THIS PORTION MARKED WITH AN ASTERISK HAS BEEN OMITTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT AND FILED SEPARATELY WITH THE COMMISSION.
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in any calendar year purchase more than * of the number of Lead Extractor units
that Spectranetics sells in that calendar year in which Medtronic purchases such
units, but Medtronic may purchase at least * Lead Extractor units per year.
6.6 Supply of Product
Spectranetics expressly agrees to supply Lead Extractors to Medtronic as
indicated in the various sections of this Agreement giving Medtronic rights to
distribute. Such supply shall be based on an initial twelve month forecast upon
exercise of distribution rights. Lead time for orders shall be ninety (90) days.
The minimum order shall be 100 units of Lead Extractors. The maximum order will
be twice the forecast for the prior ninety (90) day period. Any order greater
than twice than this maximum shall be subject to Spectranetics' acceptance and
shall have delivery time set by Spectranetics in its discretion at time of
acceptance of the order.
For sales to Medtronic not under distribution rights under the terms specified
in the last paragraph of Article 6.5, the lead time for orders is sixty days.
The minimum order shall be ten (10) units. The maximum order accepted under
these terms shall be twice the amount ordered in the previous ninety (90) days.
Any demand greater than this maximum shall have the lead time confirmed by
Spectranetics at the time of order.
All payment terms are net 30 days from date of shipment to Medtronic. Sterility
dating if these devices shall be at least one year from the date of shipment to
Medtronic. The package shall be standard Spectranetics packaging for its normal
customers. Spectranetics agrees to package to Medtronic specifications under
Medtronic's label at Medtronic's request if Medtronic is distributing under this
Agreement. Any cost of such Medtronic package, beyond the usual cost of
Spectranetics' packaging, shall be borne by Medtronic.
6.7 Supply of Lasers
Spectranetics agrees to sell (subject to availability), install and maintain,
under its normal contracts, laser generators, at its prevailing prices, to
customers buying Lead Extractors from Medtronic.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
7.1 Representations of Spectranetics
Spectranetics represents, warrants and covenants to Medtronic that:
* THIS PORTION MARKED WITH AN ASTERISK HAS BEEN OMITTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT AND FILED SEPARATELY WITH THE COMMISSION.
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(a) Spectranetics is a corporation duly organized, validly existing, and
in good standing under the laws of the State of Delaware and has full corporate
power to conduct the business in which it is presently engaged and to enter into
and perform its obligations under this Agreement.
(b) Spectranetics has taken all necessary corporate action under the laws
of the state of its incorporation and its certificate of incorporation and
by-laws to authorize the execution and consummation of this Agreement and, when
executed and delivered by Spectranetics, this Agreement shall constitute the
valid and legally binding agreement of enforceable against Spectranetics in
accordance with the terms hereof, to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
(c) Neither the execution and delivery of this Agreement nor the consummation
the transactions contemplated herein will violate any provision of the
certificate of incorporation or bylaws of Spectranetics or any law, rule,
regulation, writ, judgment, injunction, decree, determination, award or other
order of any court or governmental agency or instrumentality, domestic or
foreign, or conflict with or result in any breach of any of the terms of or
constitute a default under or result in termination of or the creation or
imposition of any mortgage, deed of trust, pledge, lien, security interest or
other charge or encumbrance of any nature pursuant to the terms of any contract
or agreement to which Spectranetics is a party or by which Spectranetics or any
of its assets is bound.
7.2 Representations of Medtronic
Medtronic represents, warrants and covenants to Spectranetics that:
(a) Medtronic, Inc. is a corporation duly organized, validly existing, and
in good standing under the laws of the State of Minnesota and has full corporate
power to conduct the business in which it is presently engaged and to enter into
and perform its obligations under this Agreement.
(b) Medtronic has taken all necessary corporate action under the laws of
the state of its incorporation and its articles of incorporation and bylaws to
authorize the execution and consummation of this Agreement and, when executed
and delivered by Medtronic, this Agreement shall constitute the valid and
legally binding agreement of Medtronic enforceable against Medtronic in
accordance with the terms hereof, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
(c) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated herein will violate any provision
of the articles and bylaws of Medtronic or any law, rule, regulation, writ,
judgment, injunction, decree, determination, award or other order of any court
or governmental agency or instrumentality, domestic or foreign, or conflict with
or result in any breach of any of the terms of or constitute a default under or
result in
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termination of or the creation or imposition of any mortgage, deed of trust,
pledge, lien, security interest or other charge or encumbrance of any nature
pursuant to the terms of any contract or agreement to which Medtronic is a
party or by which Medtronic or any of its assets is bound.
(d) Medtronic warrants that, to the best of its knowledge, it knows of no
prior art or other prior art basis upon which it can be reasonably asserted
which would render any patents in the Medtronic Intellectual Property invalid.
ARTICLE 8
INDEMNIFICATION
8.1 Indemnification by Spectranetics
Spectranetics shall indemnify, defend and hold harmless Medtronic and each of
its subsidiaries, officers, directors, shareholder, employees, agents and
affiliates (collectively, all such indemnities are referred to in this
Section as "Medtronic") against and in respect of any and all claims,
demands, losses, obligations, liabilities, damages, deficiencies, actions,
settlements, judgments, costs and expenses which Medtronic may incur or
suffer or with which it may be faced (including reasonable costs and legal
fees incident thereto or in seeking indemnification therefor), (referred to
as "Costs") arising out of or based upon the breach by Spectranetics of any
of its representations, warranties, covenants or agreements contained or
incorporated in this Agreement, and any costs arising out of a claim of
patent infringement against Spectranetics arising out of Royalty Products or
Costs arising out of injury to person or property arising out of use or sale
of Royalty Products. An amount for which Medtronic is entitled to
indemnification pursuant hereto is referred to as an "Indemnified Amount."
8.2 Indemnification by Medtronic.
Medtronic shall indemnify, defend and hold harmless Spectranetics and each of
its subsidiaries, officers, directors, shareholder, employees, agents and
affiliates (collectively, all such indemnities are referred to in this Section
as "Spectranetics") against and in respect of any and all claims, demands,
losses, obligations, liabilities, damages, deficiencies, actions, settlements,
judgments, costs and expenses which Spectranetics may incur or suffer or with
which it may be faced (including reasonable costs and legal fees incident
thereto or in seeking indemnification therefor), (referred to as "Costs")
arising out of or based upon the breach by Medtronic of any of its
representations, warranties, covenants or agreements contained or incorporated
in this Agreement or any agreement, certificate or document executed and
delivered to Spectranetics by Medtronic in connection with the transactions
hereunder. An amount for which Spectranetics is entitled to indemnification
pursuant hereto is referred to as an "Indemnified Amount."
8.3 Third Party Claims.
If a claim by a third party is made against any indemnified party, and if the
indemnified party intends to seek indemnity with respect thereto under this
Article 8, such indemnified party shall promptly notify the indemnifying party
of such claim; provided, however, that failure to give timely notice shall not
affect the rights of the indemnified party except to the extent, if any, that
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the failure to give timely notice adversely affects the indemnifying party's
ability to defend such claim against a third party. The indemnifying party shall
be entitled to settle or assume the defense of such claim, including the
employment of counsel reasonably satisfactory to the indemnified party. If the
indemnifying party elects to settle or defend such claim, the indemnifying party
shall notify the indemnified party within thirty (30) days (but in no event less
than twenty (20) days before any pleading, filing or response on behalf of the
indemnified party is due) of the indemnifying party's intent to do so. If the
indemnifying party elects not to settle or defend such claim or fails to notify
the indemnified party of the election within thirty (30) days (or such shorter
period provided above) after receipt of the indemnified party's notice of a
claim of indemnity hereunder, the indemnified party shall have the right to
contest, settle or compromise the claim without prejudice to any rights to
indemnification hereunder. Regardless of which party is controlling the
settlement or defense of any claim, (a) both the indemnified party and
indemnifying party shall act in good faith, (b) the indemnifying party shall not
thereby permit to exist any lien, encumbrance or other adverse charge upon any
asset of any indemnified party or of its subsidiaries, (c) the indemnifying
party shall permit the indemnified party to participate in such settlement or
defense through counsel chosen by the indemnified party, provided that all fees,
costs and expenses of such counsel in an action controlled by the indemnifying
party shall be borne by the indemnified party, unless the indemnifying party and
indemnified party have different available defenses to such third party claim,
in which case such fees, costs and expenses shall be borne by the indemnifying
party, (d) no entry of judgment or settlement of a claim may be agreed to
without the written consent of the indemnified party, which consent shall not be
unreasonably withheld, and (e) the indemnifying party shall promptly reimburse
the indemnified party for the full amount of such claim and the related expenses
as incurred by the indemnified party pursuant to this Article 8. So long as the
indemnifying party is reasonably contesting any such third party claim in good
faith and the foregoing clause (b) is being complied with, the indemnified party
shall not pay or settle any such claim. The controlling party shall upon request
deliver, or cause to be delivered, to the other party copies of all
correspondence, pleadings, motions, briefs, appeals or other written statements
relating to or submitted in connection with the settlement or defense of any
such claim, and timely notices of any hearing or other court proceeding relating
to such claim.
ARTICLE 9
TERMINATION
9.1 Termination
(a) If either party breaches any of the material terms, conditions or
agreements of this Agreement, then the other party may terminate this Agreement,
at its option and without prejudice to any of its other legal and equitable
rights and remedies, by giving the breaching party ninety (90) days notice in
writing, particularly specifying the breach. Such notice of termination shall
not be effective if the other party cures the specified breach within such
ninety (90) day period, or, in the case of breaches not reasonably curable
within such ninety (90) days, if such party commences the cure thereof within
such ninety (90) days and diligently thereafter prosecutes such cure.
(b) Medtronic may, by written notice to Spectranetics, terminate this
Agreement, including the license granted pursuant to Section 2.1, at any time,
in the event of a material failure
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by Spectranetics to pay timely any payments that are required to be made to
Medtronic hereunder within 30 days of notice by Medtronic to Spectranetics of
such failure. If such payments are contested by Spectranetics, Medtronic's
right to terminate may not be executed until the right to collect has been
determined by the competent court or arbitrator and Spectranetics has failed
to pay such amount within 30 days after such determination.
(c) Either party may, by written notice to the other party (which
notice shall be effective upon dispatch), terminate this Agreement in the
event that such other party becomes insolvent, makes an assignment for the
benefit of creditors, goes into liquidation or receivership or otherwise
loses legal control of its business.
(d) Either party may, by written notice to the other party terminate
this Agreement if such other party's performance has been suspended by an
event of Force Majeure, as defined in Article 10 below, for more than one
hundred eighty (180) days in any consecutive twelve (12) month period.
(e) If any part of the Licensed Intellectual Property has been finally
found to be invalid by a court of competent jurisdiction, then Spectranetics
shall have no further obligations under this Agreement as to Royalty Products,
where the obligation arose because of that part of the Licensed Intellectual
Property, in the country of that court.
9.2 Effect of Termination
(a) The rights and obligations of the parties as to confidentiality
and shall survive any termination of this Agreement.
(b) Except as otherwise provided herein regarding Joint Inventions,
upon termination of this Agreement, each party will, within thirty (30) days,
return to the other party all tangible "Confidential Information" of the
other party (as defined in the agreements between the parties relating to
confidentiality)(except one copy which may be retained by party's legal
counsel solely for evidentiary purposes in the event of a dispute), and each
party will deliver to the other a copy of any documentation in its possession
or control specifically relating to the Joint Inventions.
ARTICLE 10
MISCELLANEOUS
10.1 Non-Disclosure
Each party agrees not to disclose or use any Confidential Information of the
other party during the during the term of this Agreement until the expiration of
three (3) after the termination or expiration of this Agreement. Each party
further agrees to take appropriate measures to prevent any such prohibited
disclosure by its present and future employees, officers, agents, subsidiaries,
or consultants during the term of this and for a period of three (3) years
thereafter.
10.2 Assignment
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This Agreement shall be binding upon and inure to the benefit of the parties
hereto and the or assigns of the parties hereto provided:
(a) The rights and obligations of Spectranetics herein may not be
assigned except to person or entity who succeeds to substantially all of
Spectranetics' business to which this Agreement relates.
(b) Notwithstanding the provisions of subparagraph (a) to the contrary,
in the event any successor to the Spectranetics business is a competitor of
Medtronic in the "cardiac rhythm management or monitoring" business (as
defined on the attached Exhibit A), Medtronic shall have the right to
immediately exercise its rights under Sections 6.3 or 6.4 above, and elect to
(i) receive a non-exclusive license from Spectranetics to manufacture Lead
Extractors utilizing all applicable Spectranetics patents and associated
know-how, with royalty payment equal to * of Medtronic's Net Sales of Lead
Extractors covered by claims of the applicable Spectranetics patents; or
(ii) continue to purchase Lead Extractors from Spectranetics, provided that the
transfer price for lead Extractors purchased from Spectranetics shall be
equal to * of Spectranetics average U.S. selling price for purposes of
Sections 6.3 or 6.5. In no event will Spectranetics be required to sell
Medtronic Lead Extractors below Spectranetics' manufacturing cost as
defined in Article 6.5.
(c) The rights and obligations of Medtronic herein may not be assigned
except to a person or entity who succeeds to all or a substantial portion of
Medtronic's business to which this Agreement relates.
(d) Except as expressly modified herein, the remaining rights and
obligations of the parties under this Agreement would remain in full force and
effect in the event of any such assignment. Any attempted assignment of this
Agreement in violation of this Section 10.2 shall be null and void.
10.3 Entire Agreement
This Agreement constitutes the entire agreement of the parties with respect to
the subject matter of such agreement and supersedes all previous proposals or
agreements, oral or written, and all negotiations, conversations or discussions
heretofore had between the parties related to the subject matter of such
agreements. This Agreements supersedes agreements between Medtronic and
Spectranetics dated May 2, 1991, May 21, 1991, August 12, 1994, and March 10,
1995, except that any confidentiality obligation under such agreements shall
survive according to the terms of those agreements.
* THIS PORTION MARKED WITH AN ASTERISK HAS BEEN OMITTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT AND FILED SEPARATELY WITH THE COMMISSION.
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10.4 Survival
All of the representations, warranties, and indemnifications made in this
Agreement, and all terms and provisions hereof intended to be observed and
performed by the parties after termination hereof (to the extent specified
herein), shall survive such termination and continue thereafter in full force
and effect, subject to applicable statutes of limitations.
10.5 Amendment, Waiver, Discharge, etc.
This Agreement may not be amended, released, discharged, abandoned, changed or
modified in any manner, except by an instrument in writing signed on behalf of
each of the parties to this Agreement by their duly authorized representatives.
The failure of either party to enforce at any time any of the provisions of this
Agreement shall in no way be construed to be a waiver of any such provision, nor
in any way to affect the validity of this Agreement or any part of it or the
right of either party after any such failure to enforce each and every such
provision. No waiver of any breach of this Agreement shall be held to be a
waiver of any other or subsequent breach.
10.6 Execution in Counterparts
This Agreement may be executed in one or more counterparts, all of which shall
be considered one and the same agreement, and shall become a binding agreement
when one or more counterparts have been signed by each party and delivered to
the other party.
10.7 Titles and Headings; Construction
The titles and headings to Sections and Articles herein are inserted for the
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement. This Agreement shall be
construed without regard to any presumption or other rule requiring construction
hereof against the party causing this Agreement to be drafted.
10.8 Benefit
Nothing in this Agreement, expressed or implied, is intended to confer on any
person other than the parties to this Agreement or their respective successors
or permitted assigns, or sublicense any rights, remedies, obligations or
liabilities under or by reason of this Agreement.
10.9 Notices
All notices or other communications to a party required or permitted hereunder
shall be in writing and shall be delivered personally or by telecopy (receipt
confirmed) to such party or shall be sent by a reputable express delivery
service or by certified mail, postage prepaid with return receipt requested,
addressed as follows:
if to Medtronic to:
Medtronic, Inc.
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0000 Xxxxxxx Xxxxxx X.X.
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: General Manager Xxxxx Leads
FAX (000) 000-0000
and to:
Medtronic, Inc.
0000 Xxxxxxx Xxxxxx X.X.
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Law Department
FAX (000) 000-0000
if to Spectranetics to:
The Spectranetics Corporation
00 Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, XX 00000
Attention: President/CEO
FAX (000) 000-0000
Spectranetics or Medtronic may change their respective above-specified
recipient and/or mailing address by notice to the other party given in the
manner herein prescribed. All notices shall be deemed given on the day when
actually delivered as provided above (if delivered personally or by telecopy)
or on the day shown on the return receipt (if delivered by express delivery
service or by mail).
10.10 Severability
If any provision of this Agreement is held invalid by a court of competent
jurisdiction, such provision shall be enforced to the maximum extent permissible
and the remaining provisions shall nonetheless be enforceable according to their
terms.
10.11 Execution of Further Documents
Each party agrees to execute and deliver without further consideration any
further applications, licenses, assignments or other documents, and to perform
such other lawful acts as the other party may reasonably request to fully secure
and/or evidence the rights or interests herein.
10.12 Relationship
The relationship of Medtronic and Spectranetics with respect to this Agreement
will be that of independent contractors. Neither party has, and will not,
represent, without the prior written consent of the other party, that it has any
power, right or authority to bind or to incur any charges or expenses on behalf
of the other party or in the other party's name. Nothing stated in this
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Agreement will be construed as constituting Medtronic and Spectranetics, or
their Affiliates, as partners or as creating the relationships of
employer/employee, franchisor/franchisee, or principal/agent between them.
Neither party nor its Affiliates nor its or their employees or agents are, or
will act, as employees of the other party within the meaning or application of
any unemployment insurance laws, social security laws, workers' compensation or
industrial accident laws, social security laws, workers' compensation or
industrial accident laws, or under any other laws or regulations which may
impute any obligations or liability to the other by reason of an employment
relationship. The parties will indemnify and reimburse each other for and hold
the other harmless from any liabilities or obligations imposed or attempted to
be imposed upon a party by virtue of any such law in performance by a party of
this Agreement.
10.13 Force Majeure
Neither party shall be in default because of any failure to perform such party's
obligations under this Agreement if such failure arises from causes beyond the
reasonable control of such party ("the first party") and without the fault or
negligence of such first party, including without limitation, Acts of God or of
the public enemy, acts of the Government in either its sovereign or contractual
capacity, fires, floods, earthquakes, epidemics, quarantine restrictions,
strikes, or freight embargoes. In each instance, the failure to perform must be
beyond the reasonable control and without the fault or negligence of the first
party. If it appears that performance under this Agreement may be delayed by an
event of Force Majeure, the first party will immediately notify the other party
as soon as practicable in writing at the address specified in this Agreement.
During the period that the performance by one of the parties of its obligations
under this Agreement has been suspended by reason of an event of Force Majeure,
the other party may likewise suspend the performance of all or part of its
obligations hereunder to the extent that such suspension is commercially
reasonable.
10.15 Compliance with Laws
The parties, and any permitted sublicense of the parties, will comply with all
applicable international, national, state, regional and local laws and
regulations, including all applicable import and export control laws, in
exercising their rights or performing their duties under this Agreement.
10.16 Governing Law
This Agreement shall be governed by, and interpreted and constructed in
accordance with, the laws of the State of Minnesota.
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IN WITNESS WHEREOF, each of the parties has caused this License and Development
Agreement to be executed in the manner appropriate to each.
THE SPECTRANETICS CORPORATION
By: /s/ Xxxxx X. XxXxxxxxx
------------------------------------
Its: Chief Financial Officer
-------------------------------
MEDTRONIC, INC.
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Its: Vice President
-----------------------------------
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