Exhibit 10.2
MASTER LICENSE AGREEMENT
THIS AGREEMENT is by and between SurModics, Inc., a corporation of the State of
Minnesota, which has an office at 0000 Xxxx 00xx Xxxxxx, Xxxx Xxxxxxx, XX 00000
(hereinafter referred to as SURMODICS), and Rubicon Medical Inc., a Utah
corporation, which has an office at 0000 Xxxx Xxxxxxxxx, Xxxx Xxxx Xxxx, XX
00000 (hereinafter referred to as RUBICON).
WHEREAS, SURMODICS is engaged in biological, chemical and technical research and
has developed a body of technology and know-how, including reagents, processes,
and devices which the parties believe will improve the performance of various
products and processes of RUBICON.
WHEREAS, the technology of SURMODICS includes confidential information
(including trade secrets and other know-how) which is proprietary to SURMODICS
and SURMODICS is in the process of securing patent coverage for certain items of
its technology, and continues to maintain the confidentiality of other portions
of its technology.
WHEREAS, RUBICON and SURMODICS are parties to a Mutual Confidential Disclosure
Agreement dated March 18, 2002 ("Prior Disclosure Agreement");
WHEREAS, RUBICON may desire to acquire additional licenses under SURMODICS'
know-how and patent rights, such licenses to be added to this Master Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth below and for other good and valuable consideration of which receipt is
acknowledged, the parties agree as follows:
1. DEFINITIONS
The following definitions apply to this Master License Agreement (the
"Agreement"), and to all Attachments thereto:
a. "Affiliate" means any entity which owns at least 20% of, is at least
20% owned by, or is under common (at least 20%) ownership with RUBICON.
b. "Effective Date" means the later of the dates on which this
Agreement is signed by the parties, as indicated by the dates on the
signature page hereof.
c. "Know-how" means SURMODICS' trade secrets and other legally
protected proprietary technical information relating to the surface
treatment of medical devices and which SURMODICS has the right to
transmit to others. Know-how includes but is not limited to non-public
information contained in pending patent applications of Patent Rights
and information that is Confidential Information as defined in
Paragraph 13.
d. "Licensed Products" means each of the separately sold Medical
Products specifically described in Xxxxxxxxxx X0, X0, and so forth, and
which:
i. but for the license granted herein the manufacture, use or
sale would infringe (or a surface treatment process employed
to produce a product or a reagent used in such process would
infringe) any valid and subsisting claim in the Patent Rights,
or
ii. are produced through the use of SURMODICS' Know-how.
1
e. "Licensed Product Effective Date" for each license granted herein
shall mean the date specified in the respective Xxxxxxxxxx X0, X0, and
so forth.
f. "Manufacturer" means a non-Affiliate third party which manufactures
Licensed Products for RUBICON pursuant to a separate agreement with
RUBICON and subject to the execution by the Manufacturer and SURMODICS
of the document entitled "Manufacturer Agreement and SurModics'
Consent" attached hereto as Attachment C.
g. "Medical Products" means products that are specifically defined in
Xxxxxxxxxx X0, X0, and so forth.
h. "Net Sales" means the total actual billing for sales of Licensed
Products, less the following deductions where they are applicable with
respect to such xxxxxxxx and when separately shown on invoices or
otherwise traceable and accounted for in the ordinary course of
RUBICON's business:
i. discounts actually allowed and taken;
ii. any customs duties, taxes or other governmental excise or
charge upon or measured by the production, sale,
transportation, delivery or use of Licensed Product and
actually paid by RUBICON;
iii. amounts allowed or credited on rejections or returns; and
iv. transportation charges, including transportation insurance
charges, prepaid or allowed.
Notwithstanding the above, if any Licensed Product is sold both
separately and as an integral part of a combination product containing
one or more integral components in addition to that Licensed Product,
then Net Sales of that Licensed Product resulting from sales of that
combination product will be calculated by multiplying the Net Sales for
the combination product as calculated above by the fraction A/B where A
is the invoice price of the Licensed Product as sold separately and B
is the invoice price of the combination product.
A Licensed Product shall be considered sold when it is shipped or when
it is invoiced, whichever is earlier. To assure SURMODICS the full
royalty payment contemplated in this Agreement, RUBICON agrees that if
any Licensed Product is sold to an Affiliate for purposes of resale,
Earned Royalties for that Licensed Product shall be computed upon the
selling price at which such Licensed Product would ordinarily be sold
to a non-Affiliate, rather than on the selling price of RUBICON to the
Affiliate.
Free samples and products used only for internal purposes (such as for
testing, demonstration or quality assurance) by RUBICON or any
Affiliate shall not be subject to royalties.
i. "Patent Rights" means the right to practice the claims disclosed in
the patent application(s) and patent(s) identified in Attachment A
hereof, together with all foreign counterparts, divisions, and
continuation applications based thereon, any patent issuing on any of
said applications, and any reissues or extensions based on any of such
patents.
j. "Valid Claim" means a claim of Patent Rights that has not (i) been
held invalid by a court of competent jurisdiction or other government
agency having jurisdiction beyond possibility of appeal or (ii) expired
or lapsed.
2
2. LICENSE
a. With respect to the Licensed Product defined in each of Xxxxxxxxxxx
X0, X0, and so forth, SURMODICS grants to RUBICON, a separate worldwide
license under SURMODICS' Patent Rights and Know-how to make, have made
for it only by a properly sublicensed Manufacturer as set forth herein,
use, distribute, service and sell, offer to sell and import that
Licensed Product. The license granted herein is expressly limited to
the specific Licensed Products defined herein, and does not include the
right to sublicense except as provided below in Paragraph 2(b) with
respect to Manufacturers and Paragraph 2(c) with respect to Affiliates.
All licenses granted by SURMODICS to RUBICON under this Agreement are
non-exclusive unless specifically stated otherwise for a particular
Licensed Product in an Xxxxxxxxxx X0, X0, and so forth. Additional
terms of each license are set out in the respective Xxxxxxxxxxx X0, X0,
and so forth. To the extent any ambiguity or inconsistency is created
between the terms set forth in this Agreement and the terms set forth
in Xxxxxxxxxxx X0, X0, and so forth, the terms set forth in the
Attachment B shall be controlling with respect to the Licensed Product
defined therein; for all other matters, the terms set forth in this
Agreement shall control. Each such license shall be effective as of its
Licensed Product Effective Date.
b. Subject to Paragraph 2(a) and the following provisions, RUBICON
shall have the right to grant have made rights to Manufacturers. No
sublicense shall be effective unless and until the document entitled
Manufacturer Agreement and SurModics' Consent attached as Attachment C
has been executed by the Manufacturer, delivered to SURMODICS, and
signed by SURMODICS. RUBICON shall be responsible for and shall take
reasonable steps to ensure each Manufacturer is aware and performs the
Manufacturer's obligations as sublicensee in all material respects.
Each sublicense to a Manufacturer shall terminate automatically and
without notice at such time as the separate agreement between RUBICON
and the Manufacturer expires or is terminated. Each sublicense to a
Manufacturer shall terminate automatically without notice upon
termination or expiration of this Agreement or the relevant license
hereunder, and RUBICON's agreement with the Manufacturer must provide
for such automatic termination.
c. Subject to Paragraph 2(a) and the following provisions, RUBICON
shall have the right to grant sublicenses to its Affiliates. RUBICON
shall be responsible for and hereby guarantees the payment of royalties
to SURMODICS by the sublicensee and the performance of all of the
sublicensee's obligations provided herein. No sublicense shall be
effective unless and until the document entitled SurModics' Consent to
Sublicense attached as Attachment D has been executed by the
sublicensee, delivered to SURMODICS, and signed by SURMODICS. Each
sublicense to an Affiliate of RUBICON shall terminate automatically and
without notice at such time as the sublicensee ceases to be an
Affiliate of RUBICON. Each sublicense to an Affiliate of RUBICON shall
terminate automatically and without notice upon termination or
expiration of this Agreement or the relevant license thereunder.
d. Subject to the limited license granted herein, SURMODICS shall
retain all rights to the Patent Rights and Know-how. SURMODICS shall
retain the right to use Patent Rights and Know-how for its own research
purposes.
e. RUBICON shall notify SURMODICS, in advance and in writing, of the
location of the production of a Licensed Product or any new location to
be used for the production of a Licensed Product.
3
f. In the event any governmental agency in a jurisdiction materially
alters or hinders or prevents enforcement of the terms or provisions of
any license granted herein, SURMODICS may, at its sole discretion,
immediately terminate that license with respect to such jurisdiction.
3. MILESTONE PAYMENTS
For each license granted by SURMODICS, RUBICON shall make Milestone
Payments to SURMODICS as set out in the Attachment (B1, B2, and so
forth) applicable to such license.
4. ROYALTIES
For each license granted herein, RUBICON shall pay to SURMODICS a
royalty for each quarter calendar year during the term of this
Agreement which will be the greater of the royalties of Paragraphs 4(a)
or 4(b).
a. Earned Royalties shall be calculated as provided for in the
respective Xxxxxxxxxx X0, X0, and so forth. No more than one Earned
Royalty shall be paid by RUBICON for any Licensed Product. However, if
any Licensed Product is covered by more than one Xxxxxxxxxx X0, X0, and
so forth, then the Earned Royalty rate shall be the highest rate
specified for such Licensed Product.
b. Minimum Royalties shall be paid for each Licensed Product as
provided for in the respective Xxxxxxxxxx X0, X0, and so forth.
c. Royalty Stacking. If, at any time during the life of this Agreement,
RUBICON discovers that any Licensed Product or the use thereof
infringes claims of an unexpired patent or patents other than those in
the Patent Rights, RUBICON may, if it has not already done so,
negotiate with the owner of such patents for a license on commercially
reasonable terms. Should the license with the owner of such patents
require the payment of royalties or other consideration to such owner
(for technology that is also within the scope of licenses granted to
RUBICON under this Agreement), then the royalties otherwise payable
under this Agreement shall be reduced by up to one-half based on the
value of the patents other than those in the Patent Rights relative to
the Patent Rights licensed under this Agreement. The parties shall meet
promptly after RUBICON takes the license under such other patents to
agree on the relative value of such patents and the amount of royalty
reduction. If the parties cannot agree the dispute shall be resolved in
accordance with Paragraph 24 hereof.
5. ROYALTY PAYMENTS, REPORTS, RECORDS
a. During the term of this Agreement, and for each license granted
hereunder, RUBICON will make written reports and payments to SURMODICS
within forty-five (45) days after the last day of each calendar quarter
ending March 31, June 30, September 30, and December 31. Each such
report shall state the Net Sales, unit volumes, Earned Royalty,
corrections of error in prior royalty payments, and data and
calculations used by RUBICON to determine such payments for each of the
licenses corresponding to the respective Xxxxxxxxxxx X0, X0, and so
forth. Each report shall be accompanied by payment in full of the
royalty due SURMODICS for that quarter. The December 31 quarterly
report shall also include a nonbinding summary forecast of projected
sales of Licensed Products and a nonbinding forecast of reagent usage
for the next calendar year. The report and any forecasts shall
constitute confidential information and be subject to the
confidentiality provisions of this Agreement.
4
b. RUBICON will maintain, for a period of five (5) years following each
sale of Licensed Product, true and accurate records supporting the
reports and payments made under this Agreement. SURMODICS shall have
the right to carry out an audit of such records no more frequently than
once per calendar year by an independent certified public accountant of
its choice upon giving RUBICON not less than five (5) days advance
notice. All such audits shall be conducted during RUBICON's normal
office hours, and such accountant shall have reasonable access to
RUBICON's offices and the relevant records, files and books of account,
and such accountant shall have the right to examine any other records
reasonably necessary to determine the accuracy of the calculations
provided by RUBICON under Paragraph 5(a). The auditor shall be required
to sign a suitable confidentiality agreement reasonably acceptable to
RUBICON prior to conducting such audit. Such audit shall be at
SURMODICS' expense except that if an underpayment error is found for
any twelve month period that exceeds 5% of the payment made to
SURMODICS for that period, then RUBICON will bear the cost of such
audit.
c. All royalties on sales of each Licensed Product to be paid to
SURMODICS by RUBICON under this Agreement shall be paid in U.S. Dollars
to SURMODICS in the United States. For the purpose of calculating
Earned Royalties on sales outside the United States in a foreign
currency for any calendar quarter, RUBICON shall utilize the average
rate of exchange on the last business day of that calendar quarter as
quoted in the Wall Street Journal unless manifestly in error);
provided, however, that if a foreign currency not listed in the Wall
Street Journal is involved, then the closing transfer buying rate
quoted by Citibank (New York) (unless manifestly in error) shall be
employed in effecting such conversion thereof.
d. Any sum required under U.S. tax laws (or the tax laws of any other
government) to be withheld by RUBICON from payment for the account of
SURMODICS shall be promptly paid by RUBICON for and on behalf of
SURMODICS to the appropriate tax authorities, and RUBICON shall furnish
SURMODICS with official tax receipts or other appropriate evidence
issued by the appropriate tax authorities sufficient to enable
SURMODICS to support a claim for income tax credit in respect to any
sum so withheld.
6. TECHNICAL SUPPORT FEES
SURMODICS has prior to this Agreement provided product coating services
to RUBICON under a clinical coating agreement. Commencing on the
Effective Date, RUBICON will begin doing its own product coating using
the licenses and reagents provided for in this Agreement. RUBICON shall
be entitled to up to 40 hours of technical support from SURMODICS,
without charge, during the first sixty days of the term of this
Agreement for purposes of setting up and conducting its own coating
operations. SURMODICS, however, shall not be required to provide
technical support after such 60-day period except pursuant to a
separate technical support agreement, which agreement shall be offered
by SURMODICS to RUBICON if requested. Such technical support agreement
shall provide for the payment by RUBCICON of fees ("Technical Support
Fees") for any support provided under the agreement at SURMODICS'
then-standard rates. As of March 1, 2004, SURMODICS' standard rates for
5
Technical Support Fees are $125 per-hour for standard-testing coating
work, $150 per-hour for coating parts used in human clinical trials,
and $250 per-hour for SURMODICS' analytical chemistry services.
SURMODICS may change its standard Technical Support Fees with thirty
(30) days advance written notice to RUBICON. SURMODICS shall
additionally charge RUBICON for direct materials such as reagents,
parts, equipment, jigs, fixtures and SURMODICS' reasonable
out-of-pocket travel, living, and ancillary costs and expenses incurred
in connection with its performance of technical support services if
such expenses are approved by RUBICON in writing. SURMODICS shall
invoice RUBICON monthly for such Technical Support Fees, and RUBICON
shall make payment to SURMODICS within thirty (30) days after the date
of the invoice.
7. TERM
a. Unless earlier terminated, each license herein granted shall begin
upon the Licensed Product Effective Date set out in the respective
Xxxxxxxxxx X0, X0, and so forth, and shall extend for each Licensed
Product so licensed until expiration of the last to expire patent of
Patent Rights that covers that product or for a period of fifteen (15)
years following the first bona fide commercial sale of such Licensed
Product, whichever is longer.
b. Upon expiration of the last to expire patent of Patent Rights for
any Licensed Product, and upon full payment by RUBICON to SURMODICS of
all monies due under this Agreement, the license with respect to
Know-how licensed herein for that Licensed Product shall be deemed paid
up and non-exclusive, if any such license was exclusive.
8. PATENTS
a. RUBICON shall see to it that all Licensed Products sold by RUBICON
shall be appropriately marked with the applicable patent numbers, in
conformity with applicable law.
b. SURMODICS recognizes that it is an objective of RUBICON to obtain
patents on technology that RUBICON develops. RUBICON recognizes that a
vital part of SURMODICS' business includes licensing SURMODICS'
technology to others under SURMODICS' patents and know-how to make,
use, and sell products, and that it is an objective of SURMODICS to
enable its present and future licensees to exploit patent licenses from
SURMODICS to produce and sell products without interference from any
patent that RUBICON might obtain. A purpose of this Paragraph 8 is to
establish a system under which each party may accomplish its respective
objective.
c. Title to all developed technology which is conceived or first
reduced to practice before, during, or after the term of this Agreement
and which is solely an invention of employees or agents of SURMODICS
shall be in SURMODICS. SURMODICS shall have the right to determine
whether patent or other intellectual property protection will be sought
for any such invention and shall be solely responsible for all costs
associated with obtaining and maintaining such patent or other
intellectual property protection.
d. Title to all developed technology which is conceived or first
reduced to practice before, during, or after the term of this Agreement
and which is solely an invention of employees or agents of RUBICON
shall be in RUBICON. RUBICON shall have the right to determine whether
patent or other intellectual property protection will be sought for any
such invention and shall be solely responsible for all costs associated
with obtaining and maintaining such patent or other intellectual
property protection.
6
e. With respect to inventions made jointly by one or more employees of
each party operating under this Agreement ("Joint Inventions"), the
parties agree that mutually acceptable patent counsel shall be retained
at the mutual cost and expense of the parties to render an opinion as
to the patentability thereof and to prepare, file, and prosecute such
patent applications as may reasonably be required to provide protection
for such inventions. The joint inventors each shall be required to
assign their Joint Inventions, including all patent applications
therefore and the resulting patents, if any ("Joint Patents") to
SURMODICS. SURMODICS shall immediately reassign to RUBICON an undivided
one-half interest to the Joint Inventions, including all patent
applications thereof and resulting Joint Patents. Either party may
choose at any time, upon written notice to the other, to forego any
further expense of obtaining or maintaining a Joint Patent for a Joint
Invention, and will offer to assign its interest in such Joint
Invention, patent application and/or Joint Patent to the other. If the
prospective assignee party accepts such offer, thereafter it shall at
its own expense prepare and file the necessary assignments and shall be
solely responsible for obtaining and/or maintaining Joint Patent(s) for
such Joint Invention. With respect to Joint Patents:
(i) Each party shall have the right to operate under Joint
Patents but neither party shall have the right to grant
licenses to others without the express written consent of the
other party, which consent may be withheld by the other party
in its sole and unfettered discretion.
(ii) Should either party choose to bring suit for infringement
by a third party of any Joint Patents, the party bringing suit
shall have the right to join the other party as a party to the
suit to the extent required by law; provided, however, that
such joinder shall be without expense to the joined party. Any
recovery from the defendant in any such suit in excess of the
costs of suit shall be shared by the parties equally.
f. The parties agree to execute and exchange upon request such
documents as may be necessary or desirable to carry out the provisions
of this Paragraph 8.
g. Other than as set forth herein, nothing in this Agreement shall be
construed as granting either party any rights under or to any patents,
know-how or other rights of the other.
h. To the extent that any dispute arises with respect to patents under
this Paragraph 8, the disputing party shall promptly inform the other
party of the nature of the dispute and the provisions of Paragraph 24
shall apply. The parties shall execute appropriate amendments or
assignment for the application if necessary to resolve the dispute.
i. Prosecution of Infringers. SURMODICS shall have the first right, but
not the obligation, to prosecute in its own name and at its own expense
any action it deems necessary if any Patent Rights licensed hereunder
are infringed by the manufacture, use, import, offer for sale, or sale
of any Licensed Products by any unauthorized third party. RUBICON
agrees to notify SURMODICS promptly if it becomes aware of any such
third party infringements. If SURMODICS elects to prosecute any such
action and does so at its own expense, SURMODICS shall have the right
to control the action and to retain any and all damages resulting
7
therefrom. If SURMODICS does not commence prosecution within ninety
(90) days of a written request from RUBICON, then RUBICON may prosecute
such action in its own name and at its own expense. SURMODICS shall
cooperate and, if necessary, become a named party to the action. If
RUBICON prosecutes such action, it shall indemnify and defend SURMODICS
from any losses, liabilities, claims, counterclaims, law suit expenses
(including attorney's fees), costs, and judgments arising out of any
litigation brought by RUBICON, and RUBICON shall have the right to
control the action and to retain any and all damages resulting
therefrom. If RUBICON prevails in such action, RUBICON may deduct fifty
percent (50%) of the royalties due to SURMODICS over the five (5) years
following termination of such action up to RUBICON's reasonable costs
and expenses of prosecuting such action, including its reasonable
attorneys' fees. SURMODICS may grant a license at any time to such
unauthorized party; provided, however, if such license is granted
during the pendency of an action for infringement by RUBICON against
such party, then for purposes of this Paragraph 8(i) RUBICON shall be
deemed to have prevailed in such action. RUBICON shall not settle any
such infringement action without the advance written approval of
SURMODICS, which approval shall not be unreasonably delayed or
withheld.
9. ALLOCATION OF ROYALTIES
RUBICON's obligation to pay royalties with respect to any Licensed
Product shall terminate at such time as neither the manufacture, nor
the use, nor the sale of that specific Licensed Product (or a surface
treatment process or a reagent used in such process) is covered by any
Valid Claim of Patent Rights.
10. TERMINATION
a. For each license granted herein:
RUBICON's Right to Terminate for Convenience & Without Cause
i. RUBICON shall have the right to terminate each license
granted with respect to each Xxxxxxxxxx X0, X0, and so forth,
under which such license was granted, but only in its
entirety, at any time upon sixty (60) days advance written
notice. Upon termination of any such license, RUBICON shall
have no further rights under Patent Rights or Know-how with
respect to the Licensed Product of that license. However,
RUBICON shall be allowed to sell any inventory of Licensed
Products existing at the time of termination for a period of
nine (9) months thereafter (thereafter destroying any
remaining inventory), provided RUBICON accounts for such sales
of inventory and pays SURMODICS the appropriate Earned Royalty
for such sales as set out in Paragraph 4(a) of this Agreement.
Termination of RUBICON's rights as to any one license under
this subparagraph (i) shall not effect Rubicon's rights as to
other licenses granted by SURMODICS.
SURMODICS' Right to Terminate for Cause ii. SURMODICS may
terminate this Agreement in whole or with respect to any
license granted herein upon sixty (60) days written notice for
any material breach or default by RUBICON, including without
limitation, failure to comply with the confidentiality
provisions of Paragraph 13, failure to make reports and
payments when due, failure to pay Minimum Royalties, and
withholding or notice of intent to withhold any royalties
provided for in this Agreement. If the breach in question
relates only to one license, the foregoing termination right
shall be limited to such license. Said termination under this
Paragraph 10(a)(ii) shall become effective at the end of the
sixty (60) day period unless during that period RUBICON shall
8
first cure such breach or default or, if the breach or default
is of a nature that cannot be cured within sixty (60) days,
Rubicon commences a cure during such 60-day period and
thereafter diligently pursues the same to completion.
iii. Upon termination of any license under any of the
provisions of this Paragraph 10, but subject to the provisions
of Paragraph 10(a)(i), referring to the sale of inventory,
RUBICON shall cease making, having made, using, and selling
the Licensed Products of such license that are produced
through the use of SURMODICS' Know-how. SURMODICS shall have
the right to seek equitable relief to enforce the provisions
of this Paragraph 10(a)(iii).
b. Either party may terminate this Agreement if the other party hereto
is involved in insolvency, dissolution, bankruptcy or receivership
proceedings affecting the operation of its business.
c. Notwithstanding the provisions of Paragraph 20, failure of RUBICON
to initiate bona fide commercial sales of any Licensed Product by the
date set out for that Licensed Product in the respective Xxxxxxxxxx X0,
X0, and so forth, to this Agreement shall permit SURMODICS to terminate
the license for that Licensed Product upon thirty (30) days written
notice at any time prior to the date RUBICON begins bona fide
commercial sales of that Licensed Product. Prior to exercising such
right, however, SURMODICS shall consult with RUBICON to determine the
reason for such failure, and if RUBICON is endeavoring to bring one or
more Licensed Products to market and has been prevented from doing so
because of technical problems, regulatory delays, market conditions or
other similar circumstances, the parties will negotiate in good faith a
reasonable extension of the applicable date for initiating bona fide
commercial sales.
d. In the event that all licenses granted herein are terminated,
RUBICON and SURMODICS shall each have the right to terminate this
Agreement in its entirety upon written notice to the other.
11. CONTINUING OBLIGATIONS SUBSEQUENT TO TERMINATION
a. Upon any termination of this Agreement or any of the licenses
granted herein, the following rights and obligations shall continue to
the degree necessary to permit their complete fulfillment or discharge:
i. SURMODICS' right to receive and RUBICON's obligation to pay
royalties to the extent owed; and
ii. RUBICON's obligation to maintain records and SURMODICS'
right to audit under Paragraph 5, with respect to sales made
and to be made under Paragraph 10(a)(i); and
iii. Any cause of action or claim of either party, accrued or
to accrue, because of any breach or default by the other
party; and
iv. The parties' obligations to maintain confidentiality under
Paragraph 13; and
9
v. RUBICON's obligation to forebear from use of SURMODICS'
Know-how as provided in Paragraph 10(a)(iii); and
vi. The parties' obligations under Paragraph 8.
b. Within thirty (30) days of the date of termination of this
Agreement, each party shall return all copies of Confidential
Information of the other, except one archival copy which may be
retained by the receiving party for purposes of determining its
on-going obligations under this Agreement.
12. REPRESENTATIONS AND WARRANTIES
a. Intentionally Omitted.
b. Each party warrants to the other that it has the full and
unrestricted right to enter into this Agreement and carry out the
obligations hereunder.
c. SURMODICS represents and warrants that:
i. as of the Effective Date, to the best of its knowledge,
none of the Reagents or processes that SURMODICS provides to
RUBICON under this Agreement and included within the Patent
Rights infringe any United States or foreign patent owned by a
third party and not licensed by SURMODICS.
ii. as of the Effective Date, it has no knowledge of any
pending or threatened challenge to the validity or
enforceability of any Patent Rights in any court; and
iii. as of the Effective Date, it has no knowledge of any
claim of patent infringement made against it by a third party
with respect to Licensed Products.
d. Except as expressly stated in Paragraphs 12(a) through 12(c),
nothing in this Agreement shall be construed as:
i. A warranty or representation that anything made, used,
sold, or otherwise disposed of, or any process practiced,
under any license granted in this Agreement is or will be free
from infringement of patents of third persons; or
ii. A requirement that SURMODICS file any patent application,
secure any patent, or maintain any patent in force; provided,
however, that in the case of any patent applications
identified on Attachment A as of the Effective Date, SURMODICS
shall exercise reasonable diligence to have such patents issue
and as to the patents listed on such Attachment SURMODICS
shall exercise reasonable diligence to keep them in force; or
iii. An obligation to furnish any manufacturing or technical
information not encompassed within Know-how; or
iv. Conferring any right on either party to use in
advertising, publicity, or otherwise any trademark or trade
name of the other; or
v. Granting by implication, estoppel, or otherwise any
licenses or rights under patents or other proprietary
information of SURMODICS other than those included within
Patent Rights and Know-how; or
10
vi. An obligation to bring or prosecute action or suits
against third parties for infringement of any patent; or
vii. A warranty or representation by SURMODICS as to the
validity or scope of any Patent Rights.
e. EXCEPT AS EXPRESSLY PROVIDED IN PARAGRAPH 12(c) ABOVE AND IN
PARAGRAPH 25(d) BELOW, With respect to reagents supplied at any time by
SURMODICS, SURMODICS disclaims all warranties, express or implied,
including but not limited to warranties of merchantability,
non-infringement and fitness for a particular purpose. Notwithstanding
anything to the contrary, WITH RESPECT TO REAGENTS SUPPLIED BY
SURMODICS, SURMODICS shall not be liable for incidental, consequential,
special, extraordinary or punitive damages of any description, whether
for damage to reputation or goodwill, lost profits, claims of third
parties or otherwise, whether such asserted damage purports to be based
on warranty or guarantee, indemnity or other contract, contribution,
negligence or other tort, or otherwise.
f. Without limiting the warranties made by SURMODICS elsewhere in this
Agreement, SURMODICS does not make any representations, extend any
warranties of any kind, either express or implied, or assume any
responsibilities whatsoever with respect to use, sale, or other
disposition by RUBICON or its vendees or transferees of Licensed
Products incorporating or made by use of the Patent Rights and Know-how
licensed under this Agreement.
g. RUBICON represents and warrants that the Licensed Products are
medical devices or device-drug combination products subject to
regulation under the U.S. Food, Drug, and Cosmetic Act.
13. CONFIDENTIALITY
a. Each party agrees to retain in confidence all Know-how and all
information received from the other party and identified by the other
party as confidential, including without limitation, information
required to be maintained in confidence under prototype development or
manufacturing scale-up or post scale-up relationships between the
parties ("Confidential Information"), for a period commencing on the
date of disclosure and ending five (5) years from the date of
termination of this Agreement. Each party agrees that it will not use
Confidential Information of the other for any purpose other than in
accordance with this Agreement. Further, each party agrees that it will
not disclose Confidential Information of the other to any third party
without the advance written approval of the other party. Confidential
Information shall not include information that:
i. at the time of its disclosure to the receiving party is
available to the public;
ii. after disclosure becomes available to the public through
no fault of the receiving party;
iii. the receiving party can show was in its possession at the
time of disclosure to it by the other; or
iv. the receiving party can show was received by it from a
third party without breach of a confidential obligation.
11
In addition, a receiving party shall have no duty to hold in confidence
any Know-how or information deemed to be Confidential Information under
this Agreement if the receiving party is compelled by application of
law or legal process to divulge, but the receiving party shall provide
the disclosing party with advance written notice before divulging the
information to enable the disclosing party to seek a protective order
or employ other means to preserve the confidential nature of that
information.
b. SURMODICS shall assist RUBICON's regulatory compliance efforts by
maintaining and updating a Device Master File with the FDA that
contains such information about the SURMODICS surface coating
compositions as set forth in FDA's submission and maintenance
guidelines for such files. SURMODICS will, at RUBICON's request,
provide similar information to regulatory agencies of competent
jurisdiction outside the United States but SURMODICS shall not be
obligated to disclose confidential information to any such foreign
agencies except to the extent such agencies verify, to SURMODICS'
reasonable satisfaction, that such information shall be maintained in
secrecy. It is agreed that the information in SURMODICS' Device Master
Files with the FDA and information provided to foreign regulatory
agencies is SURMODICS Confidential Information.
c. For the purpose of this entire Paragraph 13, Confidential
Information which is specific shall not be deemed to be within any of
the specified exceptions merely because it is embraced by more general
information in such exception. In addition, any combination of features
shall not be deemed to be within any of the specified exceptions merely
because individual features are in such exception, but only if the
combination itself and its principle of operation are in such
exception.
d. Notwithstanding the above, RUBICON specifically agrees that it will
not disclose to any Affiliates or other third party any of SURMODICS'
Know-how relating to the manufacture of SURMODICS' chemical reagents,
the precise chemical composition of such reagents, how such reagents
are tested, how they are quality controlled, and any other specific
information concerning the production of such reagents, except to the
extent such disclosure is required by applicable law or legal process
or in connection with the exercise by RUBICON of its "have made" rights
or in connection with a sublicense under Paragraph 2(b) or Paragraph
2(c).
e. The provisions of this entire Paragraph 13 shall survive termination
of this Agreement for any reason.
f. Nothing herein shall in any way affect the obligations of the
parties under any prior secrecy or confidential disclosure agreements,
including the Prior Disclosure Agreement, which obligations shall
continue in accordance with the terms of each such agreement. However,
this Agreement supersedes the Prior Disclosure Agreement between the
parties with respect to disclosures made between the parties after the
Effective Date of this Agreement.
14. ASSIGNMENT
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their successors and permitted assigns. Either party
may assign its rights and obligations under this Agreement to a
financially responsible third party, but only in connection with a
complete transfer to the third party of the business to which this
Agreement pertains. The assigning party will so inform the other party
to this Agreement without delay of any assignment made in accordance
with the conditions of this Agreement. This Agreement shall not
otherwise be assignable by either party without the prior written
consent of the other party. For purposes of this Paragraph 14, a sale
of the outstanding capital stock of RUBICON, or any portion thereof,
shall not be considered an assignment of this Agreement or of RUBICON's
rights and obligations under this Agreement, even if such sale results
in a change in control of RUBICON.
12
15. GOVERNMENT APPROVAL
RUBICON shall have the sole responsibility, at RUBICON's sole expense,
for obtaining any government approvals that may be required for the
investigation or marketing of Licensed Products; provided, however,
that SURMODICS shall cooperate, without expense, in such government
approval process.
16. PRODUCT LIABILITY
RUBICON will defend and indemnify SURMODICS against all losses,
liabilities, lawsuits, claims, expenses (including attorney's fees),
costs, and judgments incurred through personal injury, property damage,
or other claims of third parties, arising from the design, manufacture,
use, or sale of Licensed Products, except to the extent caused by
SURMODICS' gross negligence or willful misconduct.
17. NO WAIVER
Any waiver of any term or condition of this Agreement by either party
shall not operate as a waiver of any other or continued breach of such
term or condition, or any other term or condition, nor shall any
failure to enforce a provision hereof operate as a waiver of such
provision or of any other provision hereof.
18. NOTICES
All communications or other notices required or permitted under this
Agreement shall be in writing and shall be deemed to be given (i) when
personally delivered, (ii) five days after mailing when mailed by
registered or certified mail, postage prepaid, (iii) on the day of
sending when sent by facsimile (with recorded transmission completion),
or (iv) two days after sending when sent by reputable express courier,
and addressed as follows:
If to SURMODICS:
License Administration
SurModics, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxx Xxxxxxx, XX 00000
FAX Number: (000) 000-0000
If to RUBICON:
President
Rubicon Medical Inc.
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxx Xxxx Xxxx, XX 00000
FAX Number: (000) 000-0000
Either party shall have the right to change the person and/or address
to which notices hereunder shall be given, by notice to the other party
in the manner set out above.
19. CAPTIONS
The captions and headings of this Agreement are for convenience only
and shall in no way limit or otherwise affect any of the terms or
provisions contained herein. This Agreement shall be construed without
regard to any presumption or other rule requiring construction hereof
against the party drafting this Agreement.
13
20. FORCE MAJEURE
Neither party shall be liable for failure to perform as required by any
provisions of this Agreement where such failure results from a cause
beyond such party's reasonable control such as acts of God, regulation
or other acts of civil or military authority, required approval(s) of
government bodies, fires, strikes, floods, epidemics, quarantine
restrictions, riot, delays in transportation and inabilities to obtain
necessary labor, materials, or manufacturing facilities. In the event
of any delay attributable to any of the foregoing causes, the time for
performance affected thereby shall be extended for a period equal to
the time lost by reason of such delay. The cumulative effect of all
such delays under this Paragraph 20 shall not exceed one (1) year.
21. NO AGENCY
Nothing in this Agreement authorizes either SURMODICS or RUBICON to act
as agent for the other as to any matter, or to make any representations
to any third party indicating or implying the existence of any such
agency relationship. SURMODICS and RUBICON shall each refrain from any
such representations. The relationship between SURMODICS and RUBICON is
that of independent contractors.
22. SEVERABILITY
The provisions of this Agreement shall be deemed separable. If any
provision in this Agreement shall be found or be held to be invalid or
unenforceable, then the meaning of that provision shall be construed,
to the extent feasible, to render the provision enforceable, and if no
feasible interpretation would save such provision, it shall be severed
from the remainder of this Agreement, which shall remain in full force
and effect unless the provisions that are invalid or unenforceable
substantially impair the value of the entire Agreement to either party.
In such event, the parties shall use their respective reasonable
efforts to negotiate a substitute, valid, and enforceable provision
which most nearly effects the parties' intent in entering into this
Agreement.
23. GOVERNING LAW
This Agreement shall for all purposes be governed and interpreted in
accordance with the laws of the State of Delaware, except for its
conflict of laws provisions.
24. ARBITRATION
a. In the event of any dispute concerning this Agreement, including its
interpretation, performance, breach or termination, the procedures of
this Paragraph 24 shall apply; provided, however, that either party
shall have the unrestricted right at any time to seek a court
injunction prohibiting the other party from making unauthorized
disclosure or use of Confidential Information as provided for in
Paragraph 13 or unauthorized use of SURMODICS' Know-how as provided for
in Paragraph 10(a)(iii), it being understood that any such court
proceeding shall be limited to the obtaining provisional injunctive
relief pending a resolution of the merits of the underlying claim or
controversy, and such underlying claim shall otherwise be resolved,
including resolution of the merits, in accordance with the dispute
resolution procedures of this Paragraph 24.
14
b. Both parties will use good faith and reasonable efforts to resolve
any dispute informally and as soon as practical. If any such dispute is
not resolved informally within a reasonable period, then an officer
from each party, having authority to resolve the dispute, will meet at
a mutually agreeable time and place to attempt to resolve the dispute.
c. If the parties are unable to resolve a dispute as provided
immediately above, either party may submit the dispute for resolution
by mandatory, binding arbitration. If initiated by SURMODICS, the
arbitration shall take place in Salt Lake City, Utah. If initiated by
RUBICON, the arbitration shall take place in the city of Minneapolis,
MN (or such other place as the parties may mutually agree) under the
auspices of the American Arbitration Association under its Commercial
Arbitration Rules. Each party shall select one independent, qualified
arbitrator and the two arbitrators so selected shall then select a
third arbitrator in accordance with the Commercial Rules. Each party
reserves the right to object to any individual arbitrator (no matter by
whom chosen) who has been employed by or affiliated with a competing
organization.
d. The arbitrators, who shall act by majority vote, shall be empowered
to decree any and all relief of an equitable nature, including but not
limited to temporary restraining orders, temporary injunctions, and/or
permanent injunctions, and shall also be able to award damages, with or
without an accounting of costs. Judgment on the award rendered by the
arbitrator(s) may be entered into any court having jurisdiction
thereof. Each party shall bear its own costs, other than attorneys
fees, and divide other reasonable arbitrator costs equally.
e. The prevailing party in any such arbitration shall be entitled to
any award of its reasonable attorneys fees.
25. TERMS OF ORDERS/REAGENTS
a. SURMODICS agrees to supply to RUBICON reasonable quantities (taking
into consideration RUBICON's actual needs for the coating of Medical
Products) of the photoreactive reagents that RUBICON utilizes in the
production of Licensed Products ("Reagents") pursuant to mutually
agreed upon purchase orders. SURMODICS shall not unreasonably withhold
acceptance of a purchase order.
b. SURMODICS will take reasonable steps to adequately stock Reagents.
Delivery by SURMODICS of Reagents to Federal Express, or to another
reputable carrier in the United States, shall constitute delivery to
RUBICON.
c. SURMODICS agrees that the prices to RUBICON for the Reagents shall
be the same as the prices that SURMODICS ordinarily offers to its other
clients for equivalent volume consumption. Each SURMODICS invoice for
Reagents shall be payable in full within thirty (30) days after the
date of the invoice.
d. SURMODICS warrants that each shipment of Reagents supplied to
RUBICON shall, at the time of shipment, conform to the respective
specifications for those Reagents contained in master files submitted
by SURMODICS to the FDA and maintained by SURMODICS for purposes of
premarket approval of medical devices. SURMODICS' sole obligation and
RUBICON's sole remedy, if any shipment of Reagents does not conform to
15
such specifications, shall be (i) the replacement of the defective
shipment of Reagents, or (ii) at RUBICON's option a refund of the price
paid by RUBICON for the defective Reagents provided, however, that the
foregoing limitation of obligations and remedies shall not apply if a
Reagent does not conform to one or more master device file
specifications for that Reagent and such nonconformance was the actual
and proximate cause of the death or injury of a person who used the
resulting Licensed Product. RUBICON shall provide SURMODICS with
whatever evidence RUBICON has regarding the condition of the Reagents
to enable SURMODICS to determine whether the Reagents were defective at
the time of shipment.
e. SURMODICS agrees to provide RUBICON with a certificate of
conformance for each shipment of Reagent that states that the Reagent
conforms to all requirements of SURMODICS' product specifications.
SURMODICS will maintain quality control and traceability records for
Reagents which are adequate to define: materials used, production
processes, product formulations, quality testing, and lot traceability.
SURMODICS will maintain such records for a minimum of seven (7) years
after shipment of Reagents to RUBICON. RUBICON may audit SURMODICS'
quality systems during regular business hours following reasonable
advance written notice to SURMODICS. Prior to a third party's
participation in an audit, SURMODICS may require a suitable
confidentiality agreement between SURMODICS and the third party.
RUBICON may review SURMODICS' documents during the course of an audit
but may not remove document copies or originals from SURMODICS without
SURMODICS' advance written consent. SURMODICS reserves the right to
redact highly confidential information from materials that may be
disclosed during the audit that relate to SURMODICS' proprietary
processes. Information disclosed to RUBICON during the course of an
audit shall be treated as Confidential Information. RUBICON agrees to
provide SURMODICS with a copy of its final audit report.
f. The terms and conditions in this Agreement, together with additional
terms and conditions which may appear in SURMODICS' written acceptance
of orders from time to time, shall be the exclusive contract terms
between the parties with respect to the purchase of Reagents. In the
event of inconsistencies between the terms of this Agreement and the
terms of any order or acceptance document, the terms of this Agreement
shall govern. SURMODICS objects to any terms set forth in orders for
Reagents which are different from or additional to the provisions of
this Agreement, and no such terms shall be binding upon SURMODICS
unless SURMODICS specifically consents thereto in writing.
26. ENTIRE AGREEMENT
This Agreement, together with all attachments specifically referred to
herein, constitutes the entire agreement between the parties with
respect to the licenses granted herein, and no party shall be liable or
bound to the other in any manner by any warranties, representations or
guarantees except as specifically set forth herein. This Agreement
shall not be altered or otherwise amended except by an instrument in
writing signed by both parties.
16
IN WITNESS WHEREOF, the parties have executed this Agreement on the date last
written below.
Accepted by: Accepted by:
SurModics, Inc. Rubicon Medical Inc.
/s/ Xxxxxxx X. Xxxx /s/ Xxxxxxx X. Xxxxxx
--------------------------------------- -----------------------------
Signature Signature
Xxxxxxx X. Xxxx Xxxxxxx X. Xxxxxx
--------------------------------------- -----------------------------
Printed Name Printed Name
Vice President, Sales & Marketing President/CEO
--------------------------------------- -----------------------------
Title Title
September 8, 2004 9-20-04
--------------------------------------- -----------------------------
Date Date
17
