Exhibit 10.16
Reproduced as Executed
Redacted Version
TRANSFER, EMPLOYMENT AND ROYALTY
AGREEMENT
This TRANSFER, EMPLOYMENT AND
ROYALTY AGREEMENT (the “ Agreement ”) is
made as of May 11, 2004 (the “ Effective Date ”)
between Apogee Technology, Inc., a corporation organized and
existing under the laws of the State of Delaware, with its
principal office at 129 Morgan Drive Norwood, MA 02062 (“
Apogee ”), and Glenn Fricano, an individual residing
at [* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * ] (hereafter “ Fricano
”).
Recitals
WHEREAS, Fricano is
knowledgeable concerning micro-electro-mechanical (: MEMS
”) technology, and [* * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * *] (“[
* * *] ”);
WHEREAS , [* * *] is a [* * * * * * * * * * * * * * * * * *
* * * * * * * * * * *];
WHEREAS , [* * * * * * * * * * * * * * * * * * * * *]is a [*
* * * * * * * * * * * * * * * * * ] of [ * * *] ,[* * * * *
* * * * * * * * * * * * * * * *], among other assets, certain MEMS
technology, related documentation, and intellectual property
rights, as further defined below (the “ MEMS Technology
and Documentation ”);
WHEREAS , Fricano [* * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * ] (the “[* * * * *
* * * * * * * * * *]”);
WHEREAS , Fricano is willing, on the terms and conditions
set out below, to assign his rights under [* * * * * * * * * * * *
* * * * * * * * * * *] to Apogee, and to collect further materials
concerning the MEMS Technology and Documentation, perform due
diligence, and obtain further evidence concerning interests in the
MEMS Technology and Documentation; and
WHEREAS , Apogee wishes to receive such assignment from
Fricano, and to have Fricano collect such further materials and
perform such due diligence, and perform services for Apogee, on the
terms set out below:
NOW, THEREFORE , in furtherance of the foregoing Recitals
and in consideration of the mutual covenants and obligations set
forth in this Agreement, the Parties agree as follows:
Agreement
1.
Definitions .
Capitalized terms shall have the following meanings:
“Confidential
Information ” shall
have the meaning provided in Section 10 (Confidential
Information).
“ Employment Agreement
” shall have the meaning set out in Section 4 (Employee
Commitment).
“ Further Deliverables
” shall have the meaning set out in Section 5.1 (Further
Deliverables).
Portions of this Exhibit have been redacted, as
indicated by * * * * * * *; these portions have been provided to
the Securities and Exchange Commission pursuant to a request for
confidential treatment.
1
“ Initial Deliverables
” shall have the meaning set out in Section 5 (Delivery;
Continuing Obligations).
“ IP Rights ”
shall mean patent rights, copyrights, trademarks, rights in mask
works, trade secrets rights, and any other rights to exclude,
existing from time to time in a jurisdiction under patent law,
copyright law, trademark law, unfair competition law, moral rights
law, trade-secret law, semiconductor chip protection law, or other
similar law.
“ Knowledge ”
shall mean the actual knowledge of the indicated Party without any
investigation or due diligence on the part of such person or
persons.
“ License Revenues
” shall mean all of the royalties paid to Apogee for
licensing or similar exploitation, regardless of the form thereof,
of the MEMS Technology and Documentation (as defined
below).
“ MEMS Division ”
shall mean the division Apogee is establishing to design, develop,
manufacture and sell MEMS Products.
“ MEMS Product ”
shall mean any (a) device or intellectual property that cn be sold
or licensed that relies for its content, design, functionality or
manufacturing process in any material respect on the MEMS
Technology and Documentation and (b) any product derived from the
MEMS Technology and Documentation.
“ MEMS Technology and
Documentation ” shall mean (a) the materials, techniques,
processes, and information described in Exhibit A, including all
associated IP Rights and (b) all technology developed by the MEMS
Division or otherwise by Apogee using the services of Fricano and
others and based on or originating from the rights being
transferred pursuant to Section 3 hereof (Transfer of
Rights).
“ Party ” or
“ Parties ” shall mean Apogee, Fricano, or both
Apogee and Fricano, as the context permits.
“ Release of Rights
Agreement ” shall have the meaning set out in the
Preamble.
“ Royalty Start Date
” shall mean the first date on which Apogee sells a MEMS
Product.
“ Term ” shall
have the meaning set forth in Section 13 hereof (Term).
2.
Fricano Acquisition of
Rights . Fricano
acquired his right, title, and interest in and to the MEMS
Technology and Documentation and all associated IP Rights solely
through the Release of Rights Agreement.
3.
Transfer of Rights
. In consideration of
Apogee’s obligations under this Agreement, Fricano hereby
assigns to Apogee all of his interest in the [* * * * * * * * * * *
* * * ], and represents that he has made no other assignment of
such rights nor encumbered the same.
4.
Employment Commitment
. Apogee agrees to employ
Fricano, and Fricano agrees to accept and carry out such employment
on a full-time basis for a period of no less than one year,
commencing on the Effective Date, in accordance with the
Confidentiality, Non-Disclosure and
Portions of this Exhibit have been redacted, as
indicated by * * * * * * *; these portions have been provided to
the Securities and Exchange Commission pursuant to a request for
confidential treatment.
2
Non-Solicitation Agreements, a copy
of which is annexed hereto as Exhibit B, and incorporated herein by
such reference as if fully set forth herein, and the provisions of
Section 6 hereof. Fricano’s compensation shall be as
separately agreed to by Fricano and Apogee.
5.
Delivery; Continuing
Obligations .
Within two (2) business days of the Effective Date Fricano shall
deliver to Apogee all media in his possession as of the Effective
Date embodying the MEMS Technology and Documentation (the “
Initial Deliverables ”).
5.1
Further Deliverables
. After delivery of the
Initial Deliverables and in consideration of Apogee’s
obligations under Section 6 (Compensation), Fricano shall during
the Term of this Agreement, shall use reasonable business efforts,
at the expense of Apogee, to collect and compile media embodying
the MEMS Technology and Documentation, it being understood that
such media, due to [* * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * *]. Upon obtaining possession of any media
embodying the MEMS Technology and Documentation, Fricano shall
promptly deliver such media to Apogee (“ Further
Deliverables ”) and such Further Deliverables shall be
deemed transferred in accordance with Section 3 (Transfer of
Rights).
5.2
Costs . Actual out-of-pocket costs associated
with the collection of media and delivery of Further Deliverables
under Section 5.1 (Further Deliverables) shall be handled in
accordance with the Employment Agreement. After expiration or
termination of the Employment Agreement (if applicable), Apogee
will reimburse Fricano for his actual out-of-pocket costs, upon
submission of supporting invoices and provided Fricano obtains
written pre-approval for costs in excess of [* * * * * * * *
*].
5.3
Technical Assistance
. Fricano shall provide Apogee
with such services and consultation as is reasonably necessary to
allow Apogee to test and evaluate the MEMS Technology and
Documentation. If Fricano is not employed at Apogee, such
consulting services shall be at such rates and for such periods as
may be agreed to by Fricano and Apogee.
6.
Compensation
. In consideration of (i) the
assignment by Fricano to Apogee under Section 2 (Transfer of
Rights), and (ii) Fricano’s obligations under Section 4
(Employee Commitment), Apogee agrees as follows:
6.1
Transfer Compensation
. Apogee shall pay to Fricano
the sum of [* * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * ].
6.2
MEMS Product Royalties
. Within forty-five (45) days
of the end of each calendar quarter, Apogee shall make a payment
(the “ Royalty Payment ”) of Royalties (as
defined below) on MEMS Products calculated as set forth
below:
6.2.1
Definition of Net Sales
Revenue . The term
“ Net Sales Revenue ” [* * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * ].
Portions of this Exhibit have been redacted, as
indicated by * * * * * * *; these portions have been provided to
the Securities and Exchange Commission pursuant to a request for
confidential treatment.
3
6.2.2
Royalties.
(a) [* * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * ].
(b) [* * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * *].
6.3
Division of Royalty
Payments . Royalty
Payments shall be allocated as follows:
6.3.1
The [* * * * ] Royalty
. [* * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * *}.
6.3.2
The [* * * * ] Royalty
. [* * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* * * * * * * * * * *].
6.4
Royalty Report
. Simultaneous with the
payment of the Royalty, Apogee shall
