EXHIBIT 10.2 TO FORM 8-K OF LANDEC CORPORATION
TECHNOLOGY LICENSE AGREEMENT
TECHNOLOGY LICENSE AGREEMENT
This Technology Agreement ("Agreement"), dated as of the 28th day of
August, 1997 ("Effective Date"), is by and between LANDEC CORPORATION, a
California corporation ("Licensor") and BISSELL HEALTHCARE CORPORATION, d/b/a
XXXXXXX(TM) XXXXXXX, a Michigan corporation ("Licensee").
WHEREAS, Licensor is the owner of record of the complete right and title of
and to several United States and foreign patents relating to the QuickCast(R)
casting and splinting products.
WHEREAS, Licensor is selling to Licensee the QuickCast(TM)(R) product line,
including exclusive worldwide licensing rights to the patents and related trade
secrets knowhow and technology Licensor owns for all [****] applications,
including, but not limited to the Products (as defined below).
WHEREAS, Licensor is willing to provide Licensee with technical support
during the term of this Agreement, including support and consulting services
relating to the machinery and equipment ("Machinery") used to manufacture the
Products.
WHEREAS, Licensee wishes to license from Licensor certain intellectual
property rights of Licensor for use in making the Products and future [****]
applications.
NOW, THEREFORE, Licensor and Licensee (collectively, the "Parties") agree
as follows:
Section 1. Definitions.
1.1 "Products" means the QuickCast(R) product line and all products involving
a fabric coated with a sharp melting point polymer to shrink to fit for
[ **** ] applications.
1.2 "Patents" means the patents listed on Table I, including all reissues and
reexaminations of and/or continuations-in-part, continuations and
divisionals, and all foreign equivalents concerning the patents listed in
Table I that are needed by Licensee to make, have made, use, sell and
offer for sale the Products or any other [****] applications of the
patents listed in Table I anywhere in the world; (ii) any improvements or
modifications of the technology set forth in the patents listed in Table
I developed or acquired by Licensor;
1.3 "Licensed Technology" means the proprietary technology of Licensor
relating to fabric coated with a sharp melting point polymer to shrink to
fit for [****] applications, including (i) the Patents; and (ii) all
current trade secrets and knowhow owned, developed or acquired by
Licensor and used or useful in connection with the
Products or other uses of the Licensed Technology in [****] applications.
Section 2. License.
2.1 Subject to the further terms of this Agreement, Licensor hereby grants to
Licensee and its subsidiaries, affiliates, and controlled companies, the
exclusive, worldwide right and license in the Licensed Technology to use
the same in connection with its efforts to have made, import, make, use,
sell, and offer for sale the Products or other products or services
incorporating the Licensed Technology in the [****] applications,
including, but not limited to, the manufacture and sale of the Products
("License").
2.2 Licensee may grant sublicenses of the exclusive rights granted under
Section 2.1. Upon termination of this Agreement, all sublicense
agreements will automatically terminate.
2.3 Licensor agrees that it will not manufacture, have manufactured,
distribute or sell the Products or any other [****] products
incorporating the Licensed Technology.
2.4 Licensor shall retain such rights to the Licensed Technology as are
necessary for it to perform its obligations under that certain Supply
Agreement of even date between the parties hereto (the "Supply
Agreement").
Section 3 Consideration.
3.1 In consideration for the grant set forth in Section 2, Licensee shall pay
to Licensor a License Fee on Net Sales for a period of ten (10) years
from the date hereof according to the following schedule:
(a) On the first [****] Dollars ($[****]) of Net Sales (on a cumulative
basis), [****]% of Net Sales; and
(b) On all sales in excess of [****] Dollars ($[****]) (on a cumulative
basis), [****]% of Net Sales.
As of the tenth anniversary of the Effective Date, the License Fee shall
be fully paid and Licensee shall continue to have all the rights granted
hereunder for the remainder of the term of this Agreement.
3.2 For purposes hereof{ Net Sales shall mean the gross sales for the
Products and any other products or services incorporating the Licensed
Technology sold by Licensee, its affiliates, controlled companies or
sub-licensees as reflected on the invoice (or other documentation of
amount owed) for the Products or such other products or services
incorporating the Licensed Technology, exclusive of taxes, insurance,
shipping or similar charges less discounts, returns and allowances.
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3.3 The License Fee shall be payable in quarterly installments on or before
the 30th day following each calendar quarter, commencing October 30,
1997, with respect to the period ended September 30, 1997, through a
final payment on October 30, 2007 for the period ending August 27, 2007.
Each quarterly payment shall be accompanied by a statement showing the
Net Sales for the preceding calendar quarter and the computation of the
License Fee. All payments shall be in United States dollars. For purposes
of Net Sales denominated in a currency other than United States dollars,
the exchange ratio in effect as of the last day of each calendar quarter
shall be used for purposes of conversion to U.S. dollars. Licensor shall
have the right no less often than annually to have the License Fees paid
during the preceding two years audited by an accounting firm of national
standing selected by Licensor and Licensee agrees to provide such
accounting firm with such information as it may request to perform such
audit. Licensor shall pay all costs and expenses of such accounting firm,
unless such audit determines that License Fees have been underpaid by
more than five percent (5 %) of the total License Fees during any period
of twelve months or more, in which event, Licensee shall pay all costs
and expenses of such accounting firm.
3.4 Licensee agrees to pay all maintenance fees and annuities as they become
due. Licensee shall determine, in its sole discretion, in which
jurisdictions to maintain registration of the Patents.
Section 4. Technical Support Services. Licensor shall, at Licensee's request,
provide Licensee with reasonable technical assistance and guidance in the use of
the Licensed Technology by making relevant personnel of the Licensor available
during ordinary business hours and at times and places mutually agreed upon by
the parties, to facilitate and implement the transfer of the Licensed Technology
and to provide such other advice and assistance in the technical development of
the Products for the commercial market provided, that Licensor shall not be
obligated to provide such personnel for more than [****] days per year. Licensee
shall reimburse Licensor for such technical assistance at the rate of [****]
Dollars ($[****]) per working day and shall reimburse Licensor in the amount of
all costs of transportation, lodging and meals incurred in connection with the
provision of such technical assistance pursuant to this Section 4. The
obligation of Licensor under this Section 4 shall terminate on August 27, 2007.
Section 5. Representations and Warranties.
5.1 Licensor represents and warrants that it: (i) is the owner of record of
the complete right and title of and to the Patents and the Licensed
Technology, except such rights the inventor may have in the Patents
notwithstanding a complete assignment of the Patents to Licensor, (ii)
has the legal power and right to extend the rights granted to Licensee in
this Agreement, and (iii) that it has not made and will not make any
grants of licenses or other commitments to third parties with respect to
intellectual property in the field of [****] applications.
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5.2 Licensor represents and warrants to Licensee that the Licensed Technology
does not infringe upon any U.S. or foreign patent, trade secret, or other
proprietary rights of any third party.
5.3 Licensor represents and warrants that it will not assert against Licensee
any patent or other proprietary rights, now owned or later acquired, that
would interfere with Licensee's exercise of the rights granted in this
Agreement with respect to use of the Licensed Technology in [****]
applications.
5.4 EXCEPT AS SPECIFICALLY PROVIDED IN THIS AGREEMENT, THERE ARE NO OTHER
WARRANTIES, EXPRESS OR IMPLIED, MADE BY ANY PARTY, INCLUDING WITHOUT
LIMITATION, ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE.
Section 6. Indemnification.
6.1 Licensor shall defend, indemnify and hold harmless Licensee, its
subsidiaries, affiliates, and controlled companies, including their
respective officers and other employees, as well as their distributors,
agents, or dealers (collectively, "Indemnitees" and, individually, as
applicable, "Indemnitee"), against any claim ("Claim") for losses,
damages or other liabilities made by third parties alleging that the
Patents or Licensed Technology infringes any third party proprietary
rights.
6.2 Upon any assertion of any such Claim against any Indemnitee, Licensee
shall promptly notify Licensor of such Claim. Licensor shall control the
investigation, defense, and settlement of any such Claim.
6.3 Licensee may, at its election, after assertion of any Claim, deposit
License Fees payable to Licensor under this Agreement in an
interest-bearing reserve fund ("Reserve Fund") with a bank or trust
company of Licensee's choosing, until resolution of such Claim. Upon
resolution of the Claim, Licensee shall have the right to apply the
amounts in the Reserve Fund to (i) any lump sum to be made in settlement
of such Claim, (ii) all costs and damages assessed in a final and
unappealed judgment entered against any Indemnitee as a result of such
Claim, and (iii) all legal fees and other expenses incurred in the
defense of such Claim. Any remainder shall be paid to Licensor in full
and complete payment for all past due License Fees.
6.4 To the extent that the amounts in the Reserve Fund are insufficient,
Licensor agrees to reimburse Licensee for (i) any sum to be made in
settlement of such Claim, (ii) all costs and damages assessed in a final
and unappealed judgment entered against any Indemnitee as a result of
such Claim, and (iii) all legal fees and other expenses incurred in the
defense of such Claim.
6.5 If in settlement of any such Claim, Licensee is required to pay running
royalties to the plaintiff the License Fees to be paid by Licensee to
Licensor for any given year shall be reduced by the amount of the running
royalties for that year, and in the event such running
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royalties exceed the License Fees hereunder, Licensor shall promptly
reimburse Licensee for such excess.
6.6 In no event shall Licensor be liable to Licensee under this Agreement, a
certain Asset Purchase Agreement or Supply Agreement each of even date
under any theory of damages or through indemnification in the aggregate
for amounts greater than [****]. This limitation shall not apply to
[****]. [****].
6.7 Neither party shall be liable to other for lost profits arising out of
this Agreement, the Asset Purchase Agreement or the Supply Agreement of
even date under any theory of damages or through indemnification, even if
a party has been advised of the possibility of such damages.
6.8 The obligations of Licensor under this Section 6 shall terminate on
August 28, 2006.
Section 7. Third Party Infringement.
7.1 If any of the Patents is infringed by any third party during the term of
this Agreement, Licensor shall have the first right, but not the
obligation, to take appropriate action to suppress such infringement. If
Licensee requests Licensor in writing to suppress any infringement and
Licensor fails to take action within fourteen (14) days to suppress the
infringement or fails to file suit against the identified infringer or to
otherwise cause the infringement to cease within six (6) months, Licensee
shall have the right to enforce the patent. Licensor shall promptly
inform Licensee of any incidence of actual or potential third party
infringement of any of the Patents that Licensor is or becomes aware of
during the term of this Agreement.
7.2 In the event that Licensee exercises its right to enforce the Patents,
Licensor agrees to tender its right to enforce to Licensee and to be
named as a party if necessary. Licensor also agrees to cooperate with
Licensee in the disposition of any charge or suit against the infringer
and Licensee agrees to reimburse Licensor for all reasonable expenses
incurred by Licensor.
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7.3 All expenses, including attorney fees, incurred in the prosecution of any
charge or suit against a third party shall be borne solely by the party
that asserted the charge or filed the suit against the infringer.
7.4 Any sums recovered in any suit against a third party for infringement of
any of the Patents or in settlement of any charge of infringement shall
be distributed to the party that filed the suit.
Section 8. Confidentiality.
8.1 All confidential information of any kind relating to any product,
process, or equipment furnished to the other party in writing shall be
clearly marked by the disclosing party as confidential and will be
treated as confidential and secret and will not be disclosed by the other
party to third parties or used by the other party, without previous
written approval by the disclosing party, except that such information
may be disclosed to such employees as reasonably required under this
Agreement and who have secrecy obligations with their employer. In the
case of oral information, a written memorandum of such information marked
confidential shall be delivered to the other party within thirty (30)
days.
8.2 Each party agrees not to make any use whatsoever of confidential
information of the other disclosed to it under this Agreement except for
the purposes contemplated by this Agreement.
8.3 The obligations set forth in Sections 8.1 and 8.2 shall not in any way
restrict or impair each party's right to use or disclose to others any
information (a) which is now in its possession; (b) which is or becomes
public knowledge through no fault of the receiving party; (c) which is
obtained by the receiving party from a third party who, in making such
information known, is not in violation of any obligation of
confidentiality to the other party; or (d) that can be demonstrated to
have been developed by the other party without reference to the
confidential information.
8.4 The obligations of confidentiality contained in this Agreement shall
remain in effect for a period of five (5) years from the date this
Agreement expires or is terminated.
Section 9. Term and Termination.
9.1 The Term of this Agreement shall commence as of the Effective Date and
continue in effect until the expiration of Licensor's rights in the
Licensed Technology or until otherwise terminated in accordance with the
terms of this Agreement.
9.2 In the event that any party breaches any material term of this Agreement
and fails to remedy such breach within thirty (30) days after written
notice thereof, or in the event of a party is declared bankrupt or
insolvent, the other party shall be entitled to terminate this Agreement
upon written notification of such termination to the other.
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9.3 If Licensee fails to pay License Fees on Net Sales of at least (i) [****]
Dollars ($[****]) with respect to [****] and (ii) [****] Dollars
($[****]) with respect to any calendar year commencing with calendar year
[****] through and including calendar year 2006, Licensor may, during the
thirty (30) day period commencing April 1 of the following calendar year,
give Licensee notice that it is terminating this Agreement effective at
the end of thirty days from the date of such notice, whereupon this
Agreement shall terminate at such time unless during such notice period
Licensee pays Licensor License Fees in a sufficient amount when added to
License Fees attributable to the prior calendar to equal or exceed
License Fees on Net Sales of (i) [****] Dollars ($[****]) with respect to
[****] or (ii) [****] Dollars ($[****]) for calendar year [****] and each
subsequent year through and including calendar year 2006.
9.4 Upon termination of this Agreement pursuant to Section 9.2 or 9.3 hereof,
Licensee shall cease from any further manufacture of products
incorporating the Licensed Technology, however, Licensee shall have a
period of [****] during which to meet commitments to customers and sell
its existing inventory of products incorporating the Licensed Technology.
If such termination occurs during the first ten years of this Agreement,
Licensee will continue to pay the License Fee in accordance with Section
3 hereof with respect to Net Sales during such period.
9.5 Upon termination, the obligation of the Licensee to pay License Fees
under Section 3.1 through the date of termination and the obligations of
the parties under Sections 6 and 8 shall survive.
Section 10. Notices.
10.1 Any notice, consent, or communication required to be given or payment
required to be made to any party hereunder shall be sent to its
respective address as set forth below or to any other address as either
party may, by written notice, advise to the other from time to time:
(a) BISSELL Healthcare Corporation
0 Xxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxx 00000-0000
Fax No. (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxxx & Xxxx LLP
000 Xxx Xxxx Xxxxxxxx
000 Xxxx Xxxxxx, XX.
Xxxxx Xxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxxxxx
Fax No. (000) 000-0000
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(b) If to Licensor:
LANDEC CORPORATION
0000 Xxxxx Xxxxxx
Xxxxx Xxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxx X. Xxxxxx
Fax No. (000) 000-0000
with a copy to:
Venture Law Group
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, Xxxxxxxxxx 00000
Attention: Tae Xxx Xxxx
Fax No. (000) 000-0000
10.2 Any and all notices shall be in writing and be delivered personally; by
registered or certified mail (return receipt requested); or by telegram,
facsimile, or overnight courier, to the other party at its then-current
address. Any such notice shall be deemed to have been received by the
addressee: (i) immediately, upon personal delivery and (ii) upon the date
of receipt when delivered by other means.
Section 11. Miscellaneous.
11.1 This Agreement may be executed in a number of counterparts, each of which
shall be deemed an original and all of which together shall constitute
one and the same instrument.
11.2 Section headings are included for convenience, but shall not form a part
of the Agreement or affect the interpretation of any part hereof.
11.3 This Agreement constitutes the entire understanding of the Parties with
respect to the matters addressed herein and may be amended only by a
writing signed by both Parties.
11.4 No modification, renewal, extension, or waiver of this Agreement or any
of its provisions shall be binding, unless done in a writing signed by
the Parties.
11.5 The invalidity or unenforceability of any term or provision hereof shall
not affect the validity or enforceability of any other term or provision
hereof. Any invalid or otherwise unenforceable term or provision shall be
deemed severed herefrom and the remainder of the Agreement shall be
construed and enforced as if the Agreement did not contain such severed
term or provision.
11.6 This Agreement shall be interpreted and construed in accordance with the
laws of the state of New York, without giving effect to its choice of
laws rules.
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11.7 Licensee may assign this Agreement, provided, however, upon any such
assignment made without Licensor's written consent, Licensor may
terminate its obligations under Section 4 hereof. Licensor may not assign
this Agreement without the prior written consent of Licensee, provided,
however that Licensor may assign this Agreement without the prior written
consent of Licensee to a person or entity that acquires all the Licensed
Technology and who assumes all of the obligations of Licensor under this
Agreement.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their duly authorized representatives and to become effective as of the
Effective Date.
LANDEC CORPORATION BISSELL HEALTHCARE CORPORATION
Licensor Licensee
By: /s/ Xxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxx
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Xxxx X. Xxxxxx, President Xxxxxx X. Xxxxxxxx, President
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Pages re Table I (List of U.S. and Foreign Patents) omitted
