FIRST AMENDMENT TO TECHNOLOGY TRANSFER AGREEMENT
Exhibit
10.40
FIRST
AMENDMENT TO TECHNOLOGY TRANSFER AGREEMENT
This
First Amendment to Technology Transfer Agreement (this “Amendment”)
is entered into as of January 28, 2009 by and among Micrus Endovascular
Corporation, a Delaware corporation (“Buyer”)
and Vascular FX, LLC, a Delaware limited liability company (“Seller”).
WHEREAS, on July 28, 2005,
Buyer and Seller entered into a Technology Transfer Agreement pursuant to which
Buyer purchased from Seller all of the right, title, and interest in and to
certain intellectual property assets (the “Technology
Transfer Agreement”); and
WHEREAS, Buyer and Seller wish
to amend the Technology Transfer Agreement to modify the earn-out provisions and
eliminate the claw-back provisions thereof;
NOW THEREFORE, in
consideration of these premises and the representations, warranties and
agreements set forth in this Amendment, Buyer, and Seller agree as
follows:
AMENDMENT
1. Buyer and
Seller agree that the Technology Transfer Agreement shall be amended as follows:
(a) Clause
(c) of Section 2.4 is deleted and replaced with the following:
“Earn-out. Buyer
will pay an earn-out based on the aggregate Net Selling Price of Deflectable
Catheter Products whether such sale is made by Buyer or its affiliates or by any
third party directly or indirectly authorized by Buyer to sell Deflectable
Catheter Products, which Net Selling Price will be calculated based on sales of
Deflectable Catheter Products to non-affiliated third parties. Buyer
will pay (the “Earn-Out
Payment”) Seller or its assigns an amount equal to 25% of the Net Selling
Price of Deflectable Catheter Product(s) sold by Buyer during the Earn-Out
Period subject to the Mandatory Minimum provisions below. The Earn-out Period
for Deflectable Catheter Products is six (6) years beginning at the Start
Date. The Start Date is November 1, 2007, and the Finish Date shall
be October 31, 20013.
Notwithstanding
the foregoing, the
parties agree that the aggregate Earn-Out payment payable by Buyer to Seller
with respect to all Deflectable Catheter Products shall be not less than
$250,000 per year (the “Mandatory Minimum”). No payments shall be
made with respect to sales of Deflectable Catheter Products that occur after the
Finish Date.
Buyer
shall calculate and pay the Earn-Out Payment on a quarterly basis, with each
payment made within sixty (60) days following the close of the applicable
quarter. Payment shall be made by wire transfer of US dollar
denominated funds to a bank account designated by Seller or its designees or, if
Seller or its designees fails to give Buyer written wire instructions, by
delivery of a check payable in immediately available funds to the order of
Seller or its designees.
In
connection with the foregoing, Buyer agrees to maintain adequate documentation
and accounting records for demonstration of compliance with Earn-Out Payments
and to make such records available to Seller on Seller’s reasonable
request. Buyer shall, upon written request of Seller, make such
records available for audit to an independent certified public accounting firm
chosen and compensated by Seller (provided that if such audit finds that there
has been an under-calculation of the Earn-Out Payment in excess of 5% (but in
any event greater than $5,000), then such fees shall instead be paid by
Buyer). Seller may request such audit no more frequently than once
per calendar year; provided however, that if any substantial accounting
irregularities or discrepancies are found, then Seller may request additional
audits relating to the year during which the irregularities or discrepancies
occurred.”
(b) Section
6 (License Back to Seller) is deleted and shall be of no effect.
2. Expenses;
Notices. Each party shall bear its own expenses incurred in
connection with the preparation and execution of this Amendment. Each
party acknowledges for purposes of 8.3 of the Technology Agreement that the
parties’ respective addresses are currently those set forth on the signature
page to this Amendment.
3. No Other
Modifications. Except as expressly set forth in this
Amendment, the Technology Transfer Agreement has not been modified or
amended.
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The
parties have signed below to indicate their acceptance of the terms of this
First Amendment to Technology Transfer Agreement.
BUYER SELLER
Micrus
Endovascular
Corporation Vascular
FX, LLC
By: _____________________________ By:
____________________________
Xxxxxx
Xxxxx, Executive Vice
President Xxxx
Xxxxxxxx, Managing Member
000 Xxx
Xxxx 0000 X. Xxxxxxxx
Xx
Xxx Xxxx,
XX
00000 Xxxxx
000
Xxxx Xxxx,
XX 00000
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