[*] Indicates confidential portion has been omitted pursuant to a request
for confidential treatment and has been filed separately with the
Commission.
Patent and Technology License Agreement
This Patent and Technology License Agreement (the "Agreement") is
entered into as of May 5, 2004, (the "Effective Date") by and between Shocking
Technologies, Inc., a Delaware corporation with principle offices at ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ("STI"); Oryx, Inc., a Delaware
corporation with principle offices at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Oryx") and SurgX, Inc., a wholly owned subsidiary of Oryx with
principle offices at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
("SurgX" together with Oryx, collectively the "Licensor").
WHEREAS, Licensor is the owner of certain patents and technologies; and
WHEREAS, STI wishes to obtain, and Licensor is willing to grant,
certain licenses to such patents and technologies under the specified terms and
conditions set forth herein;
NOW THEREFORE, the parties hereto, for good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and intending to
be legally bound hereby, agree as follows:
1. DEFINITIONS. The following terms, as used in this Agreement, shall
have the meanings set forth below:
1.1 "Existing Agreements" means the rights granted to the
entities under the license agreements set forth in Exhibit B attached hereto.
1.2 "Initial Period" means the period commencing on the Effective
Date and ending two (2) years thereafter.
1.3 "Intellectual Property Rights" means any or all of the
following and any and all worldwide rights in, arising out of or associated
therewith: (i) Patents; (ii) copyrights (including any registrations or
applications therefor) and other works of authorship; (iii) trade secrets and
(iv) all other intellectual property or proprietary rights corresponding to the
foregoing anywhere in the world
1.4 "Licensed Patents" means the Patents set forth in Exhibit A
attached hereto and any and all other Patents owned or controlled by Licensor as
of the Effective Date and during the Term.
1.5 "Licensed Product" means any products developed by STI where
the manufacture, use, sale, offer for sale or import of such product would, but
for this Agreement, infringe a Valid Claim of the Licensed Patents.
1.6 "Licensed Technology" means (i) the Technology set forth in
Exhibit A attached hereto and (ii) any other Technology which is controlled by
Licensor as of the Effective Date or during the Term that is necessary or useful
for, or contributes in whole or in part to, the practice of the Licensed Patents
or exploitation of the Technology set forth in Exhibit A.
1.7 "Net Revenues" means Net Sales and Sublicense Fees.
1.8 "Net Sales" means the total amount actually received by STI
based on the sale of Licensed Products to third parties, less the sum of the
following deductions to the extend included in the gross invoice price: (i)
cash, trade or quantity discounts; (ii) sales or use taxes, tariffs,
import/export duties other excise taxes imposed upon particular sales; (iii)
transportation and insurance charges; (iv) allowances or credits to customers
due to returns; and (v) amounts received in connection with demonstration,
prototype or other non-commercial samples of Licensed Products.
1.9 "Patents" mean any and all (i) pending or issued United
States, foreign, or international patent or patent application; (ii)
continuations, continuations-in-part, substitutions or divisional applications
thereof; (iii) patents issuing on any of the foregoing; (iv) renewal, reissues,
re-examinations or extensions of any such patents or patent applications; and
(v) foreign counterparts or equivalents of any of the foregoing.
1.10 "Semiconductor Packaging Materials" means all materials used
in the assembly of an integrated circuit including but not limited to
substrates, mold compounds and wafer scale packaging, wafer redistribution,
wafer bumping and logical, technical successors thereto.
1.11 "Sublicense Fees" means amounts actually received by STI
from Sublicensees for the manufacture, use and sale of Licensed Products
excluding (i) amounts in consideration for the sale of all or substantially all
of the business or assets of STI; (ii) amounts received for securities (equity
or debt); (iii) amounts received as payment or reimbursement for research and
development; (iv) amount received in connection with demonstration, prototype or
other non-commercial samples of Licensed Products and (v) any governmental
charges, including, but not limited to, withholding or other taxes (but not
income taxes) paid or payable by STI on amounts received in consideration for a
sublicense hereunder. In the event that STI receives non-cash consideration from
Sublicensees, then such consideration shall be included in the definition of
Sublicense Fees (unless one of the foregoing exclusions apply), at the fair
market value of such non-cash consideration. In the event that any such non-cash
consideration is not readily convertible into cash, the parties shall discuss
the timing and manner of payment of such Sublicense Fees.
1.12 "Sublicensee" means any third party to whom STI has granted
a sublicense under the Licensed Patents and Licensed Technology to manufacture,
use and sell Licensed Products.
1.13 "Technology" means any and all technology, technical
information, Confidential Information, know-how, inventions, processes,
procedures, compositions, chemicals, compounds, devices, methods, formulae,
protocols, techniques, designs, drawings and other data.
1.14 "Valid Claim" shall mean (i) a claim in an issued Patent
which has not been held unenforceable, unpatentable or invalid by the decision
of a court or other governmental agency of competent jurisdiction, from which no
appeal can be taken or has been taken and from which time has expired to take an
appeal, and (ii) a claim in a Patent application that has not been on file
longer than five (5) years from the earliest priority date and has not been
issued a Patent.
2. DELIVERY; GRANT OF RIGHTS & TRAINING.
2.1 Delivery. Promptly following STI's payment of the Intial Fee,
Licensor shall deliver to STI the Technology set forth in Exhibit A in a format
and location reasonably requested by STI. In addition to the foregoing, Licensor
shall during the Term, promptly upon STI's request, but in no event more than
fifteen (15) days thereafter, deliver or make available to STI any other
Technology which is owned or controlled by Licensor as of the Effective Date or
during the Term that is necessary or useful for, or contributes in whole or in
part to, the practice of the Licensed Patents or exploitation of the Technology
set forth under Exhibit A.
2.2 Grant of Rights.
2.2.1 Exclusive License. Subject to the terms and
conditions set forth herein, including but not limited to Section 2.2.3 below,
and the Existing Agreements, Licensor hereby grants to STI an exclusive,
worldwide, irrevocable, non-assignable (except as set forth in Section 11.2
below) right and license, including the right to grant and authorize
sublicenses, (1) under the Licensed Patents to make, have made, use, sell, offer
for sale and import products, components and services that involve, use,
incorporate or otherwise relate to Semiconductor Packaging Materials and to
practice any process, method, or procedure in connection therewith; and (2)
under all of Licensor's Intellectual Property Rights (other than under the
Licensed Patents) in and to the Licensed Technology to (i) modify and create
derivative works of the Licensed Technology ("Derivative Works"); (ii) use,
copy, display, and perform the Licensed Technology and Derivative Works; and
(iii) distribute, directly or indirectly, including by way of sublicense, the
Licensed Technology and Derivative Works in each case in connection with
products, components and services that involve, use, incorporate or otherwise
relate to Semiconductor Packaging Materials or the practice of any process,
method, or procedure in connection with such products, components or services.
For avoidance of doubt, the exclusivity under the foregoing license grant with
respect to Semiconductor Packaging Materials specifically excludes any product
made by applying discrete components or mechanical devices such as pre-made
tape, film, connectors and the like, made according to Licensed Technology.
2.2.2 Non-exclusive License. Subject to the terms and
conditions set forth herein, including but not limited to Section 2.2.3 below,
Licensor hereby grants to STI a non-exclusive, worldwide, irrevocable,
non-transferable (except as set forth in Section 11.2 below) right and license,
including the right to grant and authorized sublicenses, (1) under the Licensed
Patents to make, have made, use, sell, offer for sale and import products,
components and services and to practice any process, method, or procedure in
connection therewith; and (2) under all of Licensor's Intellectual Property
Rights (other than under the Licensed Patents) in and to the Licensed Technology
to (i) modify and create derivative works of the Licensed Technology
("Derivative Works"); (ii) use, copy, display, and perform, the Licensed
Technology and Derivative Works; and (iii) distribute, directly or indirectly,
including by way of sublicense, the Licensed Technology and Derivative Works.
2.2.3 Exercise of Licenses. STI's right to exercise the
rights and licenses under Sections 2.2.1 and 2.2.2 shall only arise upon STI's
payment of the Initial Fee.
2.3 Reservation of Rights. Subject to the rights and licenses
granted in this Section 2, each party retains and shall own all of its right,
title and interest in and to their respective Technology and Intellectual
Property Rights. All rights not expressly granted hereunder are expressly
reserved by each party.
3. LICENSE FEES AND ROYALTIES.
In consideration of the licenses and rights granted by Licensor to STI
hereunder, STI will pay the following fees:
3.1 Initial Fee. For the Initial Period STI will pay to Licensor
a one-time initial fee of fifty thousand dollars ($50,000.00) ("Initial Fee")
upon the earlier of either (i) six (6) months after the Effective Date or (ii)
within thirty (30) days of STI receiving its first round of financing.
3.2 Additional License Fees and Royalties. At the end of the
Initial Period, STI may select one of the payment options set forth in Exhibit C
to extend the Term of this Agreement as set forth under Section 6 below or
immediately terminate the Agreement. To the extent STI opts to so extend the
Term of the Agreement, STI may credit the amount of the Initial Fee against the
up front license fee payment selected by STI in Exhibit C.
3.3 Multiple Royalties. In no event shall more than one royalty
be due hereunder with respect to any unit of Licensed Product. If STI is
required to pay a non-affiliated third party amounts with respect to a Licensed
Product under agreements for Patent rights or other Technology which STI, in its
reasonable judgment, determines are necessary to exercise the rights and
licenses granted hereunder, STI may deduct such amount owing to such
non-affiliated third parties (prior to any reductions) from the amounts used to
calculate Net Revenues.
3.4 Combination Products. In the event that a Licensed Product is
sold in combination with another product, component or service for which no
royalty would be due hereunder if sold separately, Net Sales from such
combination sales for purposes of calculating the amounts due under this Section
3 shall be as reasonably allocated by STI between such Licensed Product and such
other product, component or service.
3.5 Intercompany Sales. STI shall have no obligation to pay
Licensor royalties on sales of the Licensed Product between STI and its
affiliates; provided that royalties shall be paid to Licensor for resale of the
Licensed Products by STI or its affiliates to unrelated third parties.
3.6 Royalty Term. Subject to Section 3.7 below, payments of Net
Revenues with respect to the Licensed Patents will commence upon the payment of
the Extension Fee and will end on the expiration, revocation or invalidation of
the last Valid Claim under the Licensed Patents.
3.7 Initial Period Payments. During the term of the Initial
Period, any Net Revenues earned by STI from the commercial sale or sublicense of
Licensed Products or rights granted hereunder, respectively, shall be subject to
a flat [*] percent ([*]%) royalty rate, reportable and payable in accordance
with
Section 4. In the event STI exercises its right to extend the Agreement pursuant
to Section 3.2 above, STI shall either reduce or increase the amount of the
up-front license fee set forth under Exhibit C by the Royalty Rate Differential
Amount. For purposes of this Section 3.7, the term "Royalty Rate Differential
Amount" means the difference in the amount of royalties payable by STI during
the Initial Period based on the [*] percent ([*]%) royalty rate on Net Revenues
and the amount STI would have paid had the percentage rate STI opts for under
Exhibit C been in effect during the Initial Period. By way of example had STI
received $100,000 in Net Revenues during the Initial Period (i) if STI were to
select "Option 1" under Exhibit C, STI would increase the up-front license fee
by $[*] which represents the difference between the royalties payable by STI
during the Initial Term (i.e. $[*] ([*]% of $100,000)) and the amount STI would
have paid had the [*] percent ([*]%) royalty rate provided under "Option 1" been
in effect during the Initial Period (i.e. $[*] ([*]% of $100,000) and (ii) if
STI were to select "Option 5" under Exhibit C, STI would decrease the up-front
license fee by $[*] which represents the difference between the royalties
payable by STI during the Initial Term (i.e. $[*] ([*]% of $100,000)) and the
amount STI would have paid had the [*] percent ([*]%) royalty rate provided
under "Option 1" been in effect during the Initial Period (i.e. $[*] ([*]% of
$100,000).
4. REPORTING AND PAYMENT.
4.1 Reporting. Within thirty (30) days after the close of each
calendar quarter during the Term of this Agreement in which royalty payments are
due on Net Revenues, STI shall report to Licensor all royalties that have
accrued during such calendar quarter. Such quarterly reports shall indicate the
total Net Revenues received by STI and the amount of the total royalties owed
and STI shall remit such royalties on the date such report is delivered to
Licensor. In case no royalties have accrued for the quarter, STI shall not be
obligated to provide such a report.
4.2 Records and Audit. STI shall keep complete and accurate
records of its Net Revenues in sufficient detail to enable the amounts payable
under Section 3 to be determined. Upon Licensor's written request, but not more
frequently than once per calendar year, STI shall permit an independent, third
party auditor (other than on a contingency fee basis), at Licensor's expense, to
examine such records during STI's regular business hours for the purpose of and
to the extent necessary to verify any report required under this Agreement with
respect to Net Revenues received not more than three (3) years prior to the date
of Licensor's request. In the event that the amounts due to Licensor are
determined to have been underpaid, STI shall pay to Licensor any amount due and
unpaid, together with interest on such amount at the prime rate in effect at
Bank of America NT&SA, San Francisco, California, or at the maximum rate
permitted by law, whichever is lower.
4.3 Payments. All amounts payable hereunder by STI shall be
payable in United States dollars. If any currency conversion shall be required
in connection with the payment of royalties hereunder, such conversion shall be
made by using the exchange rates used by STI in calculating STI's own revenues
for financial reporting purposes.
5. PATENT PROSECUTION & ENFORCEMENT.
5.1 Patent Prosecution. Licensor will diligently file and
prosecute the Licensed Patents and timely pay all maintenance fees in connection
with any issued Patents that are part of or become part of the Licensed Patents.
Notwithstanding the foregoing, Licensor shall have the right in its sole
discretion to abandon any such issued Patents by not paying the respective
maintenance fee. If Licensor intends to abandon any such issued Patent that is
part of the Licensed Patents, Licensor will advise STI in writing of such
intention at least ninety (90) days prior to the intended abandonment date. In
such event, STI may continue to pay to maintain such issued Patents so long as
STI notifies Licensor in writing of such intention at least thirty (30) days
prior to the intended abandonment date. If Licensor fails to diligently file and
prosecute the Licensed Patents or otherwise fails to maintain any Licensed
Patents in force, then STI may elect to file or take over the prosecution or
maintenance of any such Licensed Patents, and STI shall bear all expenses
incurred in connection therewith, provided that STI shall not be liable in any
respect, either to Licensor or any third party, with respect to STI's handling
of or the results obtained from such prosecution or maintenance of any Licensed
Patent and further provided that any and all expenses incurred in connection
therewith shall be creditable against amounts owed by STI to Licensor hereunder.
Licensor agrees to reasonably cooperate with STI in preparing, filing,
prosecuting, and maintaining any such Licensed Patents and Licensor agrees to
execute any documents as shall be necessary or desirable for such purpose
5.2 Enforcement of Intellectual Property Rights.
5.2.1 Enforcement by Licensor. STI and Licensor will
promptly notify the other in writing (and provide any evidence in its
possession) of any suspected infringement by a third party of any of the
Intellectual Property Rights licensed hereunder (a "Third-Party Infringement").
Licensor shall file and/or pursue any suit or action for any Third-Party
Infringement of the Licensed Patents to the extent Licensor's failure to do so
could reasonably be expected to have more than a non-material adverse effect on
(1) STI's market for the products and services covered by or sublicenses to the
Licensed Patents or (2) STI's exclusivity under Section 2.2.1 above and Licensor
shall not, absent STI's permission, enter into any settlement or other
arrangement which grants a license or freedom to operate (including by way of a
covenant not to ▇▇▇) to any third party under the Licensed Patents which would
infringe upon or violate STI's exclusivity under Section 2.2.1 above. Unless
Licensor and STI otherwise agree, any amount recovered in any such suit or
action, whether by judgment or settlement, after deducting Licensor's reasonable
expenses (including attorney's fees), and payment to STI of any expenses
incurred by STI in providing any assistance and cooperation to Licensor in
connection with such suit or action, if any, shall be paid to or retained by
Licensor.
5.2.2 Enforcement by STI. In the event Licensor fails to
take action promptly with respect to any such Third-Party Infringement of the
Licensed Patents then, upon STI's prior written notice, STI shall have the
right, but is under no obligation, to bring any appropriate suit or action. If
STI undertakes such a suit or action, Licensor will join as a party to such suit
or action and Licensor shall fully cooperate with STI, including executing all
papers, causing its employees to testify when requested, making available
relevant records, papers, information, samples, specimens, and the like, and
performing such other acts as may be reasonably requested by STI. STI shall bear
the reasonable expenses incurred by Licensor in providing assistance and
cooperation as requested by STI pursuant to this Section. Licensor may, at its
expense, be represented by counsel of its choice. Unless Licensor and STI
otherwise agree, any amount recovered in such suit or action, whether by
judgment or settlement, after deducting STI's reasonable expenses (including
attorney's fees) and any payment to Licensor of any reasonable expenses incurred
by Licensor in providing assistance and cooperation, shall be paid to or
retained entirely by STI.
6. TERM AND TERMINATION.
6.1 Term. This Agreement will become effective on the Effective
Date and will remain in effect for the Initial Period. Upon the expiration of
the Initial Period, STI may, in its sole discretion, elect to extend the term of
the Agreement in perpetuity upon payment of the relevant Extension Fee. Upon
STI's election thereof, unless earlier terminated as set forth below, the
Agreement shall continue in full force and effect for a period of thirteen (13)
years after the expiration of the Initial Period (the "Extended Period",
together with the Initial Period, the "Term").
6.2 Termination for Convenience. STI shall have the right to
terminate this Agreement on a Licensed Patent-by-Licensed Patent basis or in its
entirety for convenience upon thirty (30) days prior written notice to Licensor.
6.3 Termination for Cause. In the event of a material breach of
this Agreement, the non-breaching party shall be entitled to terminate this
Agreement by written notice to the breaching party, if such breach is not cured
within ninety (90) days after written notice is given by the non-breaching party
to the breaching party specifying the breach. However, if the party alleged to
be in breach of this Agreement disputes such breach within such ninety (90) day
period, the non-breaching party shall not have the right to terminate this
Agreement unless it has been determined by a court of competent jurisdiction
that this Agreement was materially breached, and the breaching party fails to
comply with its obligations hereunder within ninety (90) days after such
determination.
6.4 Effect of Termination. In the event of termination (other
than by STI under Section 6.3 above) or expiration of this Agreement, then each
party shall return to the other party within thirty (30) days of said
termination date all of the other party's Confidential Information (as defined
below) in its possession, and as of said termination date, STI shall cease to
manufacture, use, sell and distribute the Licensed Products or otherwise use any
and all Licensed Patents. Notwithstanding the foregoing, and provided that
termination of this Agreement is not by Licensor under Section 6.3 above, STI
shall have the right to continue selling (but not manufacturing) the Licensed
Products post-termination solely until its existing inventory of Licensed
Products is exhausted, but in no event later than one (1) year after such
termination or expiration date. With respect to all post-termination sales of
the Licensed Products in accordance with the immediately preceding sentence, STI
shall continue to pay the royalties set forth in Section 3 and shall also be
bound by all of the other terms and conditions of this Agreement. No termination
by any party or the expiration of this Agreement shall relieve either party of
any obligation or liability accrued hereunder prior to its termination or affect
any rights (i) granted to a Sublicensee provided that STI continues to remit
payments to and reports to Licensor with respect thereto in accordance with the
terms of this Agreement (ii) granted under Section 2.2.2(2) to exploit any
Derivative Works existing on the effective date of termination.
6.5 Survival. Sections (i) 1, 3, 4, 7.1, 8, 9, and 10 shall
survive termination or expiration of this Agreement for any reason and (ii) 2
(for the period remaining in the term under Section 6.1), 5, 6.1 and 7.2 shall
survive termination of this Agreement by STI under Section 6.3 above.
7. BANKRUPTCY AND RIGHT OF FIRST REFUSAL.
7.1 Bankruptcy. All rights and licenses granted to STI pursuant
to this Agreement are, and shall otherwise be deemed to be, for purposes of
Section 365(n) of Title 11 of the United States Code (the "Bankruptcy Code"),
licenses to rights of "intellectual property" as defined thereunder.
Notwithstanding any provision contained herein to the contrary, if Licensor is
under any proceeding under the Bankruptcy Code and the trustee in bankruptcy of
Licensor, or Licensor as a debtor in possession, rightfully elects to reject
this Agreement, STI may, pursuant to Sections 365(n)(1) and (2) of the
Bankruptcy Code, retain any and all of STI' rights hereunder, to the maximum
extent permitted by law, subject to STI making the payments specified herein.
7.2 Right of First Refusal. Licensor shall not, commencing upon
and during the Extended Term of this Agreement allow any third party to acquire
any Licensed Patents (whether by way of merger, acquisition or otherwise)
without offering STI a right of first refusal, as follows. In the event Licensor
discusses or receives an offer to acquire any of the Licensed Patents from a
third party, Licensor shall provide the terms of such offer in reasonable detail
to STI for its review. In addition, if Licensor enters into a "no-shop"
arrangement or agreement in connection with such bona fide offer, such "no-shop"
arrangement or agreement shall contain an exception permitting Licensor to
provide STI with the terms of such offer. STI may either (1) refuse the offer,
in which case Licensor shall be free to enter into an arrangement on
substantially the same terms and conditions with such third party, or (2) STI
may elect to enter into an arrangement with Licensor upon substantially the same
terms and conditions, in which case the parties agree to negotiate in good faith
a definitive agreement therefor. In the event STI fails to respond to Licensor's
notice of such an offer within thirty (30) business days of receipt thereof, the
offer shall be deemed refused and Licensor shall be free to negotiate with such
third party, provided that if the offer originally made is revised by Licensor
and such third party to include terms which are materially different than the
terms originally notified to STI under this Section 7.2, such revised offer
shall be deemed an "new" offer subject to the terms of this Section 7.2.
8. LIMITATION OF LIABILITY.
8.1 EXCEPT FOR (A) LICENSOR'S BREACH OF ITS OBLIGATIONS UNDER
SECTION 5 (PATENT PROSECUTION AND ENFORCEMENT) AND SECTION 7.2 (RIGHT OF FIRST
REFUSAL) OR (B) EITHER PARTY'S BREACH OF THE REPRESENTATIONS AND WARRANTIES
UNDER SECTION 10.1, IN NO EVENT SHALL EITHER PARTY HAVE ANY LIABILITY FOR ANY
INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, HOWEVER
CAUSED, AND ON ANY THEORY OF LIABILITY, WHETHER FOR BREACH OF CONTRACT, TORT
(INCLUDING NEGLIGENCE) OR OTHERWISE, ARISING OUT OF OR RELATED TO THIS
AGREEMENT, INCLUDING BUT NOT LIMITED TO, LOSS OF ANTICIPATED PROFITS, EVEN IF
SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
8.2 EXCEPT FOR (A) LICENSOR'S BREACH OF ITS OBLIGATIONS UNDER
SECTION 5 (PATENT PROSECUTION AND ENFORCEMENT) AND SECTION 7.2 (RIGHT OF FIRST
REFUSAL); (B) EITHER PARTY'S BREACH OF THE REPRESENTATIONS AND WARRANTIES UNDER
SECTION 10.1 OR (C) AMOUNTS FOR WHICH EITHER PARTY MAY BE LIABLE UNDER SECTION
10.2 (INDEMNIFICATION) THE TOTAL LIABILITY OF EITHER PARTY ARISING OUT OF OR
RELATED TO THIS AGREEMENT SHALL NOT EXCEED THE TOTAL AMOUNT OF ROYALTIES PAID BY
STI TO LICENSOR HEREUNDER.
8.3 NOTWITHSTANDING THIS SECTION 8, NOTHING IN THIS AGREEMENT
SHALL EXCLUDE LIABILITY TO THE EXTENT THAT SUCH LIABILITY MAY NOT BE EXCLUDED OR
LIMITED BY APPLICABLE LAW.
9. CONFIDENTIALITY.
9.1 Confidential Information. "Confidential Information" shall
mean any trade secrets, confidential data or other confidential information that
is disclosed by one party ("Disclosing Party") to the other party ("Receiving
Party"), which (i) if disclosed in writing, is marked "Confidential",
"Proprietary" or in some other manner to indicate its confidential nature, or
(ii) if disclosed orally, is designated as confidential at the time of
disclosure and confirmed in writing as confidential within thirty (30) days
after its oral disclosure, which confirmation is marked in a manner to indicate
its confidential nature and delivered to the Receiving Party.
9.2 Exclusions. Notwithstanding the foregoing, Confidential
Information shall not include any information which the Receiving Party can
establish (i) was publicly known and made available in the public domain prior
to the time of disclosure by the Disclosing Party; (ii) becomes publicly known
and made available after disclosure to the Receiving Party through no action or
inaction of the Receiving Party; (iii) is in the possession of the Receiving
Party, without confidentiality restrictions, at the time of disclosure by the
Disclosing Party as shown by the Receiving Party's files and records immediately
prior to the time of disclosure; (iv) disclosed to the Receiving Party without
restriction by a third party who had a right to disclose and was not under an
obligation of confidence to the Disclosing Party; or (v) is independently
developed by the Receiving Party without use of or reference to the Confidential
Information of the Disclosing Party.
9.3 Non-Use and Non-Disclosure. Each party agrees to use the
Confidential Information of the other party solely for the purposes of
exercising its rights or performing its obligations under this Agreement. Each
party further agrees not to disclose any Confidential Information of the other
party to any third parties, except to those employees of such party who are
required to exercise its rights or perform its obligations under this Agreement
and who are bound, prior to receiving any Confidential Information, by
confidentiality obligations at least as protective as those in this Agreement.
9.4 Maintenance of Confidentiality. Each party agrees that it
shall take all reasonable measures to protect the secrecy of and avoid
disclosure and unauthorized use of the Confidential Information of the other
party. Without limiting the foregoing, each party shall take at least those
measures that such party takes to protect its own most highly confidential
information, but in no event less than reasonable measures. Each party shall
reproduce the other party's proprietary rights notices on all copies, in the
same manner in which such notices were set forth in or on the original. Each
party shall immediately notify the other party in the event of any unauthorized
use or disclosure of the Confidential Information.
9.5 Non-Disclosure of Terms. Each party agrees not to disclose to
any third party the terms of this Agreement (including all Exhibits) without the
prior written consent of the other party, except to such party's attorneys,
advisors, investors, potential investors and others on a need to know basis
under circumstances that reasonably ensure the confidentiality thereof, or in
connection with financing activities or securities filings.
9.6 Permitted Disclosures. Nothing in this Agreement shall be
deemed to prohibit the Receiving Party from disclosing any Confidential
Information that is (i) required by law or (ii) pursuant to the written consent
of the Disclosing Party; provided, however, that in the event of such
requirement, prior to disclosing any Confidential Information, the Receiving
Party will notify the Disclosing Party of the scope and source of such legal
requirement and shall give the Disclosing Party the opportunity to challenge the
need to disclose and/or limit the scope of disclosed information.
10. REPRESENTATION AND WARRANTIES & INDEMNIFICATION.
10.1 Representations and Warranties.
10.1.1 General. Each party hereby represents and warrants
that it has the full right and authority to enter into this Agreement and that
the consummation of the transactions contemplated hereunder do not violate or
breach the terms of any other agreement with any third party, including the
Existing Agreements
10.1.2 Intellectual Property. Licensor hereby represents
and warrants that (i) it is the sole and exclusive owner of the Licensed
Technology and Licensed Patents and has the right to grant the rights and
licenses thereto to STI as set forth herein; (ii) that it has not received (1)
any offers from third parties to license any third party Technology or
Intellectual Property Rights for use of the Licensed Technology by Licensor or
its other customers and (2) any written notice from any third party that the
Licensed Technology or method of making or manufacturing the Licensed Technology
infringes or misappropriates the rights of any third party and (iii) it is not
aware of any facts or circumstances for the basis of any third party making any
offer or delivering any infringement notice under (ii) above.
10.2 Indemnification.
10.2.1 Scope. Each party shall defend, or at its sole
option settle, any claims, demands, actions and other proceeding brought or
initiated by any third party (each a "Claim") against the other party to the
extent it is based on (i) a breach of any representation or warranty of such
party under Section 10.1 above. In connection with the foregoing, each party
shall indemnify the other against liabilities, damages and expenses (including
attorney's fees), which are awarded against the other party based on a Claim.
10.2.2 Procedure. A party (the "Indemnitee") that intends
to claim indemnification under this Section 10 shall promptly notify the other
party (the "Indemnitor") of any Claim for which the Indemnitee intends to claim
such indemnification. The Indemnitor shall have the right to assume and control
the defense and/or settlement thereof with counsel selected by the Indemnitor.
The failure to deliver notice to the Indemnitor within a reasonable time after
notice of any such claim or demand, or the commencement of any such action or
other proceeding, if prejudicial to its ability to defend such claim, demand,
action or other proceeding, shall relieve such Indemnitor of any liability to
the Indemnitee under this Section 10 with respect thereto. The indemnity
obligations under this Section 10 shall not apply to amounts paid in settlement
of any claim, demand, action or other proceeding if such settlement is effected
without the prior express written consent of the Indemnitor, which consent shall
not be unreasonably withheld or delayed. The Indemnitor may not settle or
otherwise consent to an adverse judgment in any such claim, demand, action or
other proceeding, that diminishes the rights or interests of the Indemnitee
without the prior express written consent of the Indemnitee, which consent shall
not be unreasonably withheld or delayed. The Indemnitee, its employees and
agents, shall at the Indemnitor's expense, reasonably cooperate with the
Indemnitor and its legal representatives in the investigation of any claim,
demand, action or other proceeding covered by this Section 10.
11. GENERAL PROVISIONS.
11.1 Notices. All notices called for under this Agreement shall
be made in writing and shall be sent by personal delivery, reputable overnight
courier service or by registered or certified mail, return receipt requested,
addressed to the other party at the address set forth above. The date of such
notice shall be deemed to be the day it is delivered, if hand delivered, or five
(5) days after deposit, if mailed.
11.2 Assignment. This Agreement may not be assigned in whole or
in party by either party without the prior written consent of the other party;
provided that either party shall be permitted to assign this Agreement in whole
without such consent in connection with the sale of all or substantially all of
the assets or business of a party to which this Agreement relates, provided that
with respect to the Licensor, the foregoing shall be subject to Section 7.2
above. Any attempted assignment in violation of the foregoing shall be null and
void and of no effect. Subject to the foregoing, this Agreement shall inure to
the benefit of and shall be binding on the parties and their permitted
successors and assigns.
11.3 Governing Law. This Agreement shall be governed by, and
construed and interpreted in accordance with, the laws of the State of
California, without reference to its principles of conflicts of law. Each party
hereby waives the application of the United Nations Convention on the
International Sale of Goods to this Agreement. Any and all disputes arising
under or in connection with this Agreement shall be submitted exclusively in the
state or federal courts located in Santa ▇▇▇▇▇ County, California, the personal
jurisdiction of which each of the parties hereby irrevocably submits.
11.4 Severability. If any term of this Agreement is held to be
invalid or unenforceable for any reason, the remainder of the provisions shall
continue in full force and effect, and the parties shall substitute a valid
provision with the same intent and economic effect.
11.5 Non-Waiver. The failure of either party at any time to
require performance by the other party of any provision hereof shall not affect
in any way, or act as a waiver of, the right to require the other party to
perform in accordance with this Agreement at any other time, nor shall the
waiver of either party of a breach of a provision of this Agreement be held or
taken to be a waiver of the provision itself.
11.6 Relationship of Parties. Nothing in this Agreement shall be
construed to create a relationship of employer and employee, principal and
agent, joint venture, partnership or association between the parties, and
neither party shall have the power to obligate or bind the other in any manner
whatsoever. SurgX and Oryx shall be jointly and severally liable to STI for the
obligations of Licensor hereunder.
11.7 Interpretation. This Agreement is to be deemed to have been
drafted jointly by the parties and any uncertainty or ambiguity shall not be
construed for or against either party based on attribution of drafting to either
party.
11.8 Headings. The paragraph headings appearing in this Agreement
are inserted only as a matter of convenience and in no way define, limit,
construe or describe the scope or extent of such paragraph, or in any way affect
such agreements.
11.9 Counterparts. This Agreement may be executed simultaneously
in two or more counterparts, each of which will be considered an original, but
all of which together will constitute one and the same instrument. Faxed
signatures shall have the same legal effect as original signatures.
11.10 Entire Agreement. This Agreement contains the parties'
entire understanding with respect to the matters contained herein and supersedes
all prior oral or written understandings with respect to the subject matter
hereof. There are no promises, covenants or undertakings other than those set
forth herein, and neither party is relying upon any representations or
warranties except as set forth herein. This Agreement may not be modified except
by a writing signed by both parties.
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized representatives to execute this Agreement.
---------------------------------------- ---------------------------------------
Shocking Technologies, Inc. SurgX, Inc.
---------------------------------------- ---------------------------------------
By: /s/▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇
---------------------------------------- ---------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------- ---------------------------------------
Title: CEO Title: CEO
---------------------------------------- ---------------------------------------
Oryx, Inc.
---------------------------------------- ---------------------------------------
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------- ---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------- ---------------------------------------
Title: CEO
---------------------------------------- ---------------------------------------
Exhibit A
Licensed Patents
A. Licensed Patents: See attached Confidential Patent Portfolio Report
B. Licensed Technology.
1. Materials & Information.
a. List of material and chemical components
comprising Licensor's proprietary liquid polymer material used
to provide electrical overstress or electrostatic discharge
protection ("Liquid Polymer Material") as the same exists on
the Effective Date and, to the extent applicable, any
improvements made thereto during the Term.
b. Documentation in electronic or tangible format
containing the following information: (i) the exact
proportions of material and chemical components for
formulation of Liquid Polymer Material; (ii) instructions
setting forth the processes and steps required for
formulating, mixing, curing and testing of the Liquid Polymer
Material; and (iii) any other information, including any
diagrams or test results reasonably required by STI to make
use of the information to be provided under (i) and (ii) above
and to exercise its rights and licenses hereunder (subsections
(a) and (b) above collectively referred to as "Materials and
Information").
2. Consultants.
To the extent STI is able to arrive a mutually
agreeable terms with SurgX's former employee ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ to
assist STI in its use of the Materials and Information under 1
above, Licensor hereby authorizes ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ to disclose
any and all information requested by or otherwise reasonably
necessary for STI to exploit the Materials and Information in
accordance with the terms of the Agreement, which shall
include but not be limited to Licensor's methods of
manufacturing Liquid Polymer Material ("Assistance"). For
avoidance of doubt, the information conveyed by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
in the course of rendering such assistance shall be subject to
non-use and non-disclosure requirements at least as protective
as those set forth herein.
SURGX PATENT PORTFOLIO
I. OVERVOLTAGE PROTECTION DEVICES
BDSM No.: Country Serial No. Filing Date Status
--------------------------------------------------------------------------------
002 US 08/790,250 07/14/94 U.S. ▇▇▇. No. 6,310,752
Issued 10/30/01
043 US 08/943,189 10/03/97 U.S. ▇▇▇. No. 6,239,687
(Div. of 002) Issued 5/29/01
069 US (Div. of 043) 04/10/01 U.S. ▇▇▇. No. 6,542,065
Issued 4/1/03
006 PCT PCT/US95/08683 07/11/95 Published WO 96/02922;
(Int'l. of 002) National Filings
Completed 1/97
028 CN 95194113.5 01/14/97 Patent Granted 2/20/02
029 EP 95 92 5619.9 01/14/97 Granted 2/19/03
National Filed 05/03
077 DE 95925619.9 05/03 Patent Granted 2/19/03
078 UK 95925619.9 05/03 Patent Granted 2/19/03
030 JP 505,099/96 01/14/97 Pending; Published
5/26/98 - 505,462/98
031 KR 97-700236 01/14/97 Patent Granted 1/14/03
032 MX 970370 01/14/97 Patent Granted 5/9/02
▇▇▇ ▇▇ ▇▇▇▇▇▇▇-▇ 01/14/97 Patent Granted 1/18/99
SURGX PATENT PORTFOLIO
II. SURGX MATERIAL AND LAYERED OVERVOLTAGE PROTECTION DEVICES
BDSM No.: Country Serial No. Filing Date Status
--------------------------------------------------------------------------------
003 US 08/841,475 07/14/94 U.S.Patent No. 5,807,509
Issued 9/15/98
053 US 09/139,309 08/24/98 U.S.Patent No. 6.657,532
(Div. of 003) Issued 12/2/03
079 US 10/702,084 11/04/03 Pending
(Cont. of 053)
007 PCT PCT/US95/08808 07/14/95 Published WO 96/02924;
(Int'l. of 003) National Filings
Completed 1/97
015 AU 32330/95 01/14/97 Patent Granted 7/14/95
016 BR PI 9508407-0 01/14/97 Patent Granted 1/22/02
018 CN 95194112.7 01/14/97 Patent Granted 11/13/02
019 EP 95 92 865.19 01/14/97 Granted 10/02 National
Filed 1/03
073 EP 02 00 4250.3 02/26/02 Pending
(Div. of 019)
075 DE 95928651.9 01/03 Patent Granted 11/13/02
076 UK 95928651.9 01/03 Patent Granted 11/13/02
020 JP 505,148/96 01/14/97 Patent Granted 1/14/03
021 KR 95-700235 01/14/97 Pending
022 MX 970369 01/14/97 Patent Granted 10/19/01
▇▇▇ ▇▇ ▇▇▇▇▇▇▇-▇ 01/14/97 Patent Granted 9/28/98
024 VN AC0510/96 01/14/97 Patent Granted 5/22/00
SURGX PATENT PORTFOLIO
III. OVERVOLTAGE PROTECTION USING GAP IN DEVICES
BDSM No.: Country Serial No. Filing Date Status
--------------------------------------------------------------------------------
044 US 08/941,917 01/22/96 US Patent No. 6,172,590
(Cont. of 005) Issued 1/9/01
037 PCT PCT/US97/00781 01/21/97 Published WO97/26665;
(Int'l from 005) National Filing
Completed 07/98
054 JP 526,218/97 07/22/98 Pending
055 EPO 97902053.4 08/22/98 Pending
045 PCT PCT/US97/21117 11/19/96 Published WO98/23018;
(Int'l from joint National Filing
Bussmann filing) Completed 5/99
060 EPO 97 94 8374.0 05/19/99 Pending
061 JP 523,834/1998 04/19/99 Pending
SURGX PATENT PORTFOLIO
IV. OVERVOLTAGE PROTECTION DEVICES ON AN INTEGRATED CIRCUIT CHIP
BDSM No.: Country Serial No. Filing Date Status
--------------------------------------------------------------------------------
049 US 09/037,771 03/10/98 US ▇▇▇. No. 6,130,459
Issued 10/10/00
068 US 09/684,530 10/06/00 US ▇▇▇. No. 6,433,394
(Div. of 049) Issued 8/13/02
059 PCT PCT/US99/05270 03/10/99 Published WO99/46820
(Int'l from 049) National Filing
Completed 10/00
064 JP 536,107/2000 09/10/00 Pending
050 US 09/037,763 03/10/98 US ▇▇▇. No. 6,064,094
Issued 5/16/00
058 PCT PCT/US99/05629 03/10/99 Published WO99/46819
(Int'l from 050) National Filing
Completed 10/00
065 JP 563,108/2000 09/10/00 Pending
SURGX PATENT PORTFOLIO
V. OVERVOLTAGE PROTECTION FOR ELECTRONIC CIRCUITS
BDSM No.: Country Serial No. Filing Date Status
--------------------------------------------------------------------------------
047 US 09/548,904 04/13/00 US ▇▇▇. No. 6,373,719
Issued 4/16/02
072 US 10/013,952 12/31/01 US ▇▇▇. no. 6,570,765
(Div. of 047) Issued 5/27/03
Exhibit B
Existing Agreements
1. Intellectual Property Rights License Agreement by and between SurgX
Corporation and Iriso Electronics Company, dated as of October 22, 1997, as
amended pursuant to that Supplemental Agreement For Amendment of Intellectual
Property Rights Agreement dated April 1, 2003.
2. Intellectual Property Rights License Agreement by and between SurgX
Corporation and ▇▇▇▇▇▇ ▇▇▇▇▇▇ Company, dated as of August 1997.
For avoidance of doubt, STI's licenses are subject to the terms of the foregoing
agreements as they exist on the Effective Date of this Agreement.
Exhibit C
License Fees and Royalties
At the end of the Initial Period of the Agreement, STI may elect one of the
following payment options to be paid within thirty (30) days of the expiration
of the Initial Period:
Option 1
--------
Up Front License Fee: $[*]
Royalty rate: [*]% on Net Revenues
Option 2:
---------
Up Front License Fee: $[*]
Royalty rate: [*]% on Net Revenues
Option 3:
---------
Up Front License Fee: $[*]
Royalty rate: [*]% on Net Revenues
Option 4:
---------
Up Front License Fee: $[*]
Royalty rate: [*]% on Net Revenues
Option 5:
---------
Up Front License Fee: $[*]
Royalty rate: [*]% on Net Revenues