EXHIBIT 10.5
TRADEMARK LICENSE AGREEMENT
THIS LICENSE AGREEMENT (the "Agreement") dated October 23, 1998,
("Effective Date") between SurgiJet, Inc., a California corporation ("COMPANY"),
and VisiJet, Inc., a California corporation (the "LICENSEE").
WHEREAS, COMPANY is the owner of and has the right trademarks and trade
names relating to products and services of COMPANY which are identified in
EXHIBIT A (the "TRADEMARKS") attached hereto.
WHEREAS, COMPANY and LICENSEE are parties to various agreements and
arrangements whereby LICENSEE is granted the right to develop and market certain
products owned by COMPANY.
WHEREAS, COMPANY and LICENSEE each desire LICENSEE to have the right to
utilize the TRADEMARKS in under certain terms and conditions in furtherance of
the business relationship of the parties.
NOW, THEREFORE, and in consideration of the covenants herein contained,
the parties agree as follows:
1. TRADEMARKS
1.1 During the term of this Agreement, COMPANY hereby grants and
LICENSEE hereby accepts an Exclusive (as defined herein), non-transferable
license (including the right to sublicense as further set forth in this
Agreement) in association with the ongoing business relationship of the COMPANY
and the LICENSEE within the Licensed Field of Use and the Licensed Territory, as
those terms are defined herein.
1.2 Unless earlier terminated as provided in this Agreement, this
Agreement shall be in force for a term commencing as of the Effective Date and
ending on the first to occur of the following:
(a) as to any individual TRADEMARK, the expiration of this
Agreement for any reason.
(b) as to all TRADEMARKS, the termination of this Agreement
for any reason.
1.3 COMPANY is responsible for maintaining all registration covering
the TRADEMARKS and renewing the registrations as required, except that all costs
therefor during the term of this Agreement shall be borne by the LICENSEE.
1.4 LICENSEE agrees that COMPANY is the exclusive owner of the
TRADEMARKS and all the goodwill attached thereto and that COMPANY shall retain
full rights to the TRADEMARKS, all registrations granted thereon and the
goodwill associated therewith. LICENSEE shall have no rights, other than rights
granted herein, to the TRADEMARKS or any confusingly similar variation thereof.
LICENSEE agrees, at the request of COMPANY to execute any and all papers and
documents necessary to preserve and extend the trademark rights relating to the
TRADEMARKS, including any Registered User Agreements and any documents required
by governmental authorities to show the relationship between LICENSEE and
COMPANY.
1.5 LICENSEE agrees not to seek registration or to claim ownership of
any TRADEMARKS, or of confusingly similar trademarks or trade names.
1.6 LICENSEE shall operate its business in accordance with the
standards and requirements of quality and production necessary to produce
products of the same quality as products manufactured and sold elsewhere by
COMPANY, or otherwise set forth by the COMPANY in writing. COMPANY shall have
the right to inspect, at reasonable times, including business hours, the
premises of LICENSEE to assure the nature and quality of all products associated
with TRADEMARKS.
2. DEFINITIONS
2.1 "Net Sales" means the gross revenue derived by LICENSEE and/or its
sublicensees from any products utilizing the TRADEMARKS, whether or not
assembled (and without excluding therefrom any components or subassemblies
thereof, whatever their origin and whether or not patent impacted), less the
following items but only insofar as they actually pertain to the disposition of
such products by LICENSEE or its sublicensees, are included in such gross
revenue, and are separately billed:
(a) Import, export, excise and sales taxes, and custom duties;
(b) Costs of insurance, packing, and transportation from the
place of manufacture to the customer's premises or point of installation;
(c) Costs of installation at the place of use; and
(d} Credit for returns, allowances, or trades.
2.2 "Licensed Field of Use" means the medical and surgical fields
related to ophthalmological applications.
2.3 "Licensed Territory" means the territory set forth is EXHIBIT B
attached hereto.
2.4 "Exclusive" means that, subject to any provisions to the contrary
in this Agreement, COMPANY shall not grant further licenses in the Licensed
Territory in the Licensed Field of Use.
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3. ROYALTIES
3.1 As consideration for the license granted hereunder, LICENSEE shall
pay to COMPANY earned royalties on Net Sales as follows: two percent (2%) of the
Net Sales for such period of time equal to the duration of the license
contemplated under this Agreement (the "Running Royalties"). All Running
Royalties shall be paid by LICENSEE to COMPANY on or before 45 days after March
31st, June 30th, September 30th and December 31st of each calendar year of the
license contemplated in this Agreement, and shall be submitted together with a
statement of Running Royalties for each such applicable period setting forth the
calculation thereof.
3.2 Running Royalties on sales is currencies other than U.S. Dollars
shall be calculated using the appropriate foreign exchange rate for such
currency quoted by the Bank of America (San Francisco) foreign exchange desk, on
the close of business on the last banking day of each calendar quarter. All
royalty payments to COMPANY shall be in U.S. Dollars. All non U.S. taxes related
to royalty payments shall be paid by LICENSEE and are not deductible from the
payments due COMPANY.
3.3 In the event of any sublicense pursuant to Article 7 herein,
LICENSEE shall pay to COMPANY one-half of all royalties received by LICENSEE
from its sublicensees in excess of that which is payable to COMPANY pursuant to
this Article 3. LICENSEE may retain the remainder of such income from
sublicensees.
3A. ROYALTY REPORTS, PAYMENTS, AND ACCOUNTING
3A.1 Beginning with the fast sale of any products utilizing the
TRADEMARKS, LICENSEE shall make quarterly written reports (even if there are no
sales) and Running Royalty payments to COMPANY on the dates set forth in Article
3. The reports shall be in a form of mutually agreeable to the parties and shall
state the number, description, and aggregate Net Sales of Licensed Products
during such completed calendar quarter, and resulting calculation pursuant to
Article 3 of the Running Royalty payment due COMPANY for such completed calendar
quarter. Concurrent with the making of each such report, LICENSEE shall include
the payment due COMPANY for the Running Royalty for the calendar quarter covered
by such report.
3A.2 LICENSEE agrees to keep and maintain records for a period of three
(3) years showing the manufacture, sale, use, and other disposition of produce
sold or otherwise disposed of under the license herein granted. Such records
will include general ledger records showing cash receipts and expenses, and
records which include production records, customers, serial numbers, and related
information in sufficient detail to enable the royalties payable hereunder by
LICENSEE to be determined. LICENSEE further agrees to permit its books. and
records to be examined by COMPANY from time to time to the extent necessary to
verify the reports provided for in Paragraph 3A.1. Such examination is to be
made by COMPANY or its designee, at the expense of COMPANY, except in the event
that the results of the audit reveal as under-reporting of royalties due COMPANY
of five percent (5%) or more, then the audit costs shall be paid by LICENSEE.
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4. TERMINATION
4.1 LICENSEE may terminate this Agreement only by giving COMPANY
notice, in writing at least thirty (30) days in advance of the effective date of
the proposed termination selected by LICENSEE, of good cause for termination of
the Agreement, and COMPANY fails to remedy any such cause within thirty (30)
days after such notice. For the purposes of this Section 4.1, the term "good
cause" shall mean the failure or breach of any representation or warranty made
by COMPANY in Article 5 of this Agreement, with the exception that LICENSEE
shall be deemed to have waived any misrepresentation or breach of representation
or warranty of which such party had knowledge before the effective date of this
Agreement.
4.2 COMPANY may terminate this Agreement if LICENSEE:
(a) Is in default in payment of royalty or providing of
reports;
(b) Becomes a bankrupt or is insolvent;
(c) Is in breach of any provisions hereof; or
(f) Provides any false report;
and LICENSEE fails to remedy any such default, breach, or false report within
thirty (30) days after written notice thereof by COMPANY.
4.3 Surviving any termination are:
(a) LICENSEE'S obligation to pay royalties accrued or
accruable;
(b) Any cause of action or claim of LICENSEE or COMPANY,
accrued or to accrue, because of any breach or default by the other party; and
(c) All of LICENSEE'S covenants and agreements contained
herein with respect t:o confidentiality and secrecy.
4.4 In the event of Expiration or Termination of this Agreement by
either party, for any cause whatsoever, LICENSEE agrees to immediately:
(1) Stop the use of TRADEMARKS on products;
(2) Stop the use of TRADEMARKS on all business papers,
advertising, catalogs or other documents of trade or record.
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5. WARRANTIES
5.1 Standing. COMPANY represents that it is a corporation duly
organized, validly existing, and in good standing under the laws of the State o
California, with all corporate powers necessary to own its assets and property
and to carry on its business as so owned and conducted.
5.2 Authority. COMPANY represents and warrants that it has full power
and authority to execute and deliver this Agreement, to grant the license
granted herein and to perform its obligations hereunder.
5.3 Negation of Warranties. Nothing in this Agreement is or shall be
construed as:
(a) A warranty or representation by COMPANY as to the validity
of any TRADEMARK;
(b) A warranty or representation that the use of any
TRADEMARKS on anything made, used, sold, or otherwise disposed of by LICENSEE
will be free from infringement or dilution of trade names or trademarks,
copyrights, and other rights of third parties; or
(c) An obligation to bring or prosecute actions or suits
against third parties for infringement; except to the extent and in the
circumstances described in Article 6 of this Agreement.
5.2 Except as expressly set forth in this Agreement, COMPANY MAKES NO
REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE
USE OF THE TRADEMARKS WILL NOT INFRINGE ANY COPYRIGHT, TRADENAME, TRADEMARK, OR
OTHER RIGHTS OR ANY OTHER EXPRESS OR IMPLIED WARRANTIES.
6. INFRINGEMENT BY OTHERS: PROTECTION OF TRADEMARKS
6.1 In the event that either party learns of facts which it concludes
might constitute as infringement, dilution, or any other violation of any of the
TRADEMARKS by any third party during the term of this Agreement, the party
learning of such facts shall promptly notify the other party in writing, setting
forth such facts and the basis for its conclusion, and shall include with such
notice any other reasonably available evidence is support thereof.
6.2 LICENSEE shall have the obligation to take all appropriate action
against the infringing party and LICENSEE shall pay all costs and expenses
(including without limitation attorneys' fees and costs of investigation and
experts) incurred in connection with such action. Any legal counsel engaged by
LICENSEE shall be reasonably satisfactory to COMPANY. COMPANY, at LICENSEE's
expense, shall have the right to participate in, and, to the extent that it may
wish, to jointly assume the prosecution of such action with counsel reasonably
satisfactory to LICENSEE. LICENSEE shall obtain the consent of COMPANY prior to
settling any such action. If LICENSEE shall fail to take all appropriate action
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as specified hereunder, then COMPANY shall have the right to take such action
and LICENSEE shall pay or reimburse COMPANY for all costs and expenses
(including without limitation attorneys' fees and costs of investigation and
experts) incurred in connection with such action.
6.3 Any proceeds from any settlement or judgment of any infringement,
claim, action, suit or proceeding brought by LICENSEE shall be allocated and/or
paid within thirty (30) days of receipt thereof as follows: (i) first to
reimburse LICENSEE (and COMPANY, pari passu to the extent that it has not
otherwise been reimbursed for attorneys' fees, costs and expenses incurred in
connection with the prosecution of such infringement) for attorneys' fees and
other costs and expenses reasonably incurred in connection with the prosecution
or other efforts to terminate the infringement pursuant to the terms of this
Agreement; and (ii) thereafter, the remainder shall be divided equally between
the parties.
6.4 Any equitable relief, including, without limitation declaratory and
injunctive relief, whether or not obtained in conjunction with the recovery of
monetary damages, shall inure to the benefit of both COMPANY and LICENSEE.
6.5 Notwithstanding any provision of this Article 6, in the event any
infringement action, suit or proceeding is brought hereunder by ether party to
enforce any rights in or to the Devices or the Technology, each party, if
legally necessary, shall, upon the written request of the other party, be named,
joined and participate therein as a nominal plaintiff.
7. SUBLICENSES
7.1 LICENSEE may grant sublicenses during the term of the license of
any TRADEMARK contemplated hereunder as set forth herein and only pursuant to
express written consent of COMPANY, such written consent not o be unreasonably
withheld.
7.2 If LICENSEE is unable or unwilling to serve or develop a potential
market or market territory for products utilizing any TRADEMARKS and for which
there are willing sublicensees, LICENSEE will, at COMPANY'S request, negotiate
in good faith all necessary sublicenses hereunder.
7.3 Any sublicenses granted by LICENSEE under this Agreement shall be
subject and subordinate to terms and conditions of this Agreement, except:
(a) Sublicense terms and conditions shall reflect that any
sublicensees shall not further sublicense; and
(b) The royalty rate specified in the sublicenses may be at a
higher rate than the rate in this Agreement. Any such sublicenses also shall
expressly include the provisions of Articles 5 and 8 of this Agreement for the
benefit of the COMPANY and provide for the transfer of all obligations,
including the payment of royalties specified in such sublicenses, to COMPANY,
its designee, in the event that this Agreement is terminated.
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7.4 LICENSEE agrees to provide COMPANY a copy of any sublicense granted
pursuant to this Article 7.
8. INDEMNITY AND INSURANCE
8.1 LICENSEE agrees to indemnify, hold harmless, and defend COMPANY and
its respective directors, officers, employees, consultants and agents against
any and all claims for death, illness, personal injury, property damage, and
improper business practices arising out of the manufacture, use, sale, or other
disposition of products utilizing the TRADEMARKS by LICENSEE or its
sublicensees, o:r their customers.
8.2 COMPANY shall not be liable for any indirect, spacial,
consequential or other damages whatsoever, whether grounded in tort (including
negligence), strict liability, contractor or otherwise. COMPANY shall not have
any responsibilities or liabilities whatsoever with respect to the TRADEMARKS or
any products utilizing the TRADEMARKS.
8.3 LICENSEE shall at all times comply, through insurance or
self-insurance, with all statutory workers' compensation and employers'
liability requirements covering any and all employees with respect to activities
performed under this Agreement.
8.4 In addition to the foregoing, LICENSEE shall maintain, during the
term of this Agreement, Comprehensive General Liability Insurance, including
Products Liability Insurance, with reputable and financially secure insurance
carriers to cover the activities of LICENSEE and its sublicensees. Such
insurance shall be written to cover claims incurred, discovered, manifested, or
made during or after the expiration of this Agreement. At COMPANY's request,
LICENSEE shall furnish a Certification of Insurance evidencing primary coverage
and requiring thirty (30) days prior written notice of cancellation or material
change to COMPANY. LICENSEE shall advise COMPANY, in writing, that it maintains
excess liability coverage (following form) over primary insurance for at least
the minimum limits set forth above. All such insurance of LICENSEE shall be
primary coverage; insurance of COMPANY shall be excess and non-contributory.
9. MARKING
Whenever LICENSEE uses the TRADEMARKS in advertizing, packaging, affixing to
product or in any other manner, LICENSEE shall clearly indicate the COMPANY's
ownership of the TRADEMARKS. LICENSEE shall provide COMPANY with samples of all
literature, packages, labels and labeling prepared by the LICENSEE containing
the TRADEMARKS. When using the TRADEMARKS under this Agreement, LICENSEE shall
comply with all laws of the United States and of the states where the Products
are marketed, and LICENSEE shall ▇▇▇▇ all products utilizing the TRADEMARKS (or
their containers or labels) which are made, sold or otherwise of by it in such a
manner as is required to protect or preserve COMPANY's rights to the TRADEMARKS
under applicable law and/or as is customary in the market for the products.
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8. NOTICES
All notices under this Agreement shall be deemed to have ben fully
given when done in writing and deposited in the United States mail, registered
or certified, and addressed as follows:
To COMPANY: SurgiJet, Inc.
▇▇-▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
To LICENSEE: VisiJet, Inc.
▇▇-▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Either party may change its address upon written notice to the other
party.
9. ASSIGNMENT
This Agreement may not be assigned.
10. ARBITRATION
10.1 Any controversy arising under or related to this Agreement, and
any disputed claim by either parry against the other under this Agreement
excluding any dispute relating to patent validity or infringement wising under
this Agreement, shall be settled by arbitration in accordance with the Licensing
Agreement Arbitration Rules of the Americas Arbitration Association.
10.2 Upon request by either parry, arbitration will be by third party
arbitrator mutually agreed upon in writing by LICENSEE and COMPANY within thirty
(30) days of such arbitration request. Judgment upon the award rendered by the
arbitrator shall be final and non-appealable and may be entered in any court
having jurisdiction thereof.
10.3 The parties shall be entitled to discovery in like manner as if
the arbitration were a civil suit in the California Superior Court. The
Arbitrator may limit the scope, time and/or issues involved in discovery.
10.4 Any arbitration shall be held at the place then designated by the
COMPANY, California, unless the parties hereto mutually agree in writing to
another place.
11. CONSTRUCTION
11.1 This Agreement shall be governed by the laws of the United States
and of the state of California applicable to agreements negotiated, executed and
performed wholly within California
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11.2 The failure of COMPANY to enforce at any time any of the
provisions of this Agreement; or any rights in respect thereto, or to exercise
any election herein provided, shall in no way be considered to be a waiver of
such provisions, rights, or elections or in any way to affect the validity of
this Agreement.
11.3 It is mutually agreed that this Agreement contains the entire
Agreement between the parties hereto applying to the matters herein contain, and
that the same has been entered into in reliance upon only the provision
contained herein and not upon any representations by either of the parties; that
this Agreement shall supersede all representations, agreements, statements and
understandings relating to such matters made prior to execution of this
Agreement, and that this Agreement can only be amended by an Agreement in
writing executed by all of the parties hereto.
11.4 The rule of construction that as agreement shall be interpreted
against the drafting party shall not apply to this Agreement. In this Agreement,
whenever the context so requires, the masculine, feminine or neuter gender, and
the singular or plural number or tense, shall include the others.
12. RELATIONSHIP OF PARTIES
Each party shall conduct all business in such party's own name as an
independent contractor. No joint venture, partnership, employment, agency or
similar arrangement is hereby created between the parties. Neither party has the
right or power to act for or on behalf of the other or to bind the other in any
respect whatsoever.
13. SEVERABILITY
If any :provision of this Agreement is determined to be ill otherwise
unenforceable by a court of competent jurisdiction, the necessary to make such
provision and/or this Agreement legal, valid or otherwise enforceable, such
provision shall be limited, construed or severed and deleted from this
Agreement, and the remaining portion of such provision and the remaining other
provisions hereof shall survive, remain in full force and effect and continue to
be binding, and shall be interpreted to give effect to the intention of the
parties insofar as that is possible.
14. AMENDMENT AND WAIVER
Neither this Agreement nor any of its provisions may be amended,
changed, modified or waived except in a writing duly executed by the party to be
bound thereby.
15. FURTHER ASSURANCES
The parties shall execute any and all additional documents and
instruments and shall take any and all other actions necessary or desirable to
carry out the intent and purposes of this Agreement.
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16. COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be as original but all of which shall together shall
constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement in
duplicate originals by their duly authorized officer or representatives.
SURGIJET, INC.
By: /S/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chairman
VISIJET, INC.
By: /S/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
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EXHIBIT A
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TRADEMARKS OF SURGIJET, INC.:
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Hydrokeratome (R)
Pulsatome (R)
VisiJet (R)
OcuJet (R)
EXHIBIT B
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The Licensed Territory is worldwide.