SurgX Corporation
and
Iriso Electronics Company
Supplemental Agreement For Amendment of
Intellectual Property Rights License Agreement
This Supplemental Agreement, dated the 1st day of April, 2003, and by
and between SurgX Corporation a corporation of Delaware, having an office and
place of business at 0000 Xxxxxxx Xxxxxxxxxx, Xxx 000, Xxx Xxxx, Xxxxxxxxxx
00000 (hereinafter referred to as "SurgX" ), and Iriso Electronics Company, a
Japanese corporation having its principal office located at 0-00-0 Xxxxxxxxxx
Xxxxxxx-Xx, Xxxxxxxx Xxxxxxxx, Xxxxx 213-0005 ("Iriso") either or both of which
may also hereinafter be referred to respectively as the "Party" or "Parties" to
this Supplemental Agreement,
WITNESSETH THAT:
WHEREAS, Iriso and SurgX have entered into the Intellectual Property Rights
License Agreement dated October 22, 1997 (the "License Agreement);
WHEREAS, Bussmann (XxXxxx-Xxxxxx) has allowed its corresponding license from
SurgX to convert from exclusive to nonexclusive;
WHEREAS, SurgX and Iriso desire to amend the terms of the License Agreement as
set forth in this Supplemental Agreement; and
WHEREAS, Iriso and SurgX each represents that it is fully authorized to deal
generally with and make an agreement respecting the subject matter hereof.
NOW, THEREFORE, in consideration of the above premises and mutual covenants
hereinafter contained, Iriso and SurgX agree as follows:
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1. The Grant under Paragraph 2.1 shall be and is hereby amended to a license to
use Intellectual Property and Technical Information for the manufacture, use and
sale of Licensed Products worldwide, which sales may be through distributors or
agents selected by IRISO, provided that IRISO shall be responsible for reporting
all such sales and for payment of royalty on such sales. The worldwide license
provided by this amendment shall be nonexclusive, without the right to
sublicense, except to the extent that the Licensed Products sold by IRISO shall
carry with them the right and license for the customer to use them for their
intended use.
2. The Royalty provisions of Paragraphs 5.1 and 5.2 and the Payment provisions
of Paragraph 6.1 shall be and are hereby replaced with the following new
Paragraphs 5.1 through 5.6 for Section 5:
5.1 The royalty shall be nine percent (9%) of Net Sales of Licensed Products
which are non-connector SurgX devices, such as component, board or chip devices.
5.2 The royalty shall be two percent (2%) of Net Sales of Licensed Products
which are SurgX connector devices.
5.3 There shall be no minimum royalties.
5.4 The term "Net Sales" shall mean total gross sales of Licensed Products
invoiced by IRISO, less only discounts shown on invoices, shipping charges shown
on invoices, taxes shown on invoices and returns of Licensed Products for which
customers are given credit.
5.5 Net Sales shall be reported and Royalties shall be paid for the previous
calendar quarter within 45 days following the last day of the previous calendar
quarter. Net Sales are to be reported and royalties paid based on invoiced
sales, without regard to product shipment or customer payment. Net Sales shall
include and Royalties shall be paid on any Licensed Product manufactured during
the term of this Supplemental Agreement reportable and due when invoiced,
without regard to when sold or shipped. Any Licensed Products bartered or
transfer priced below market price shall be reported as Net Sales on the earlier
of ship date or invoice date and royalties shall be calculated on prices charged
third parties for comparable products.
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5.6 In order to avoid double taxation, when IRISO submits royalty payments to
SurgX, IRISO will include documentation regarding any taxes withheld therefrom
because of government requirements, to enable SurgX to obtain tax treaty credit
for such withholding. Any taxes not required by the government to be withheld
from royalty payments shall be IRISO's responsibility and shall not be deducted
from or a credit claimed against royalties due.
3. The License Fee for the above grant of the worldwide license is $200,000.00
(US) payable by IRISO to SurgX upon signing of this Supplemental Agreement. This
Supplemental Agreement and the terms and provisions contained herein shall
become effective and in force upon the date of receipt by SurgX of said License
Fee ("Effective Date"). Said License Fee is nonrefundable and is not credited
against past or future royalties due SurgX.
4. This Supplemental Agreement shall be construed, interpreted and applied
consistent with the terms of the Intellectual Property Rights License Agreement
and in accordance with the laws of the State of California, USA. Except for
matters of urgent need to protect trade secret confidentiality and unauthorized
use of trade secrets of SurgX, disputes under this Agreement shall be subject to
Arbitration and such Arbitration shall be combined with and conducted consistent
with Section 10 of the License Agreement dated October 22, 1997.
5. This Supplemental Agreement shall continue in force and effect for the term
of the Intellectual Property Rights License Agreement dated October 22, 1997,
and shall terminate at the time said License Agreement is terminated for any
reason.
6. The Notice provision of Paragraph 9 shall be and is hereby amended to provide
that the address for SurgX shall be:
SurgX Corporation
0000 Xxxxxxx Xxxxxxxxxx, Xxx. 000
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx, President
7. This Supplemental Agreement constitutes the entire understanding and
agreement between the Parties relating to the item set forth herein and
supersedes and cancels any and all previous or collateral agreements,
negotiations, commitments, representations or understandings between the Parties
in respect thereto, and, except as specified herein, nothing in this
Supplemental Agreement shall supersede or in any way modify any of the terms and
conditions, or the rights and obligations of the Parties included in the
Intellectual Property Rights License Agreement between the Parties. This
Supplemental Agreement may not be changed, modified, released, discharged,
abandoned, or assigned (in whole or in part) except by an instrument in writing
signed by an authorized representative of each Party hereto.
8. This Supplemental Agreement is subject to all of the laws and regulations,
now in effect or hereafter in effect, of the United States Government and its
Departments and Agencies.
IN WITNESS WHEREOF, the Parties hereto have caused this Supplemental Agreement
to be executed by their duly authorized representatives dated as specified on
the first page of this Supplemental Agreement and effective as of the Effective
Date specified above in Paragraph 3 of this Supplemental Agreement.
Iriso Electronics Company SurgX Corporation
By: /s/ Xxxxx Xxxx By: /s/ Xxxxxx X. Xxxxxxxx
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Name: Xxxxx Xxxx Name: Xxxxxx X. Xxxxxxxx
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Title: President Title: CEO
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