Exhibit 10.1
LICENSE AND SUPPLY
AGREEMENT
This License and Supply Agreement
(this “ Agreement ”) is made as of the 29
th
day of March 2004 (the
“ Effective Date ”) between ZOLL Medical
Corporation, a Massachusetts corporation ( “ ZOLL
”), having a principal place of business at 269 Mill Road,
Chelmsford, MA 01824 and Lifecor, Inc., a Pennsylvania corporation
(“ Lifecor ”) having a principal place of
business at 121 Freeport Road, Pittsburgh, PA 15238.
WHEREAS, on November 26, 2002
the parties entered into (a) a Marketing and Distribution
Agreement (the “Distribution Agreement”) pursuant to
which Lifecor appointed ZOLL as its exclusive distributor of
certain of its products, (b) a Stock Purchase Agreement under
which ZOLL purchased Lifecor common stock for a total price of
$1,500,000 and agreed under certain conditions to purchase an
additional $1,500,000 of Lifecor common stock, and (c) a
Patent Cross-License Agreement under which Lifecor granted ZOLL and
ZOLL granted Lifecor non-exclusive licenses to each Party’s
patents (the “ Patent Cross-License Agreement
”);
WHEREAS, concurrently with the
execution of this Agreement, the Parties are entering into a Master
Agreement and an Asset Purchase Agreement under which ZOLL is,
among other things, purchasing an option to acquire all of assets
of Lifecor at future date for the consideration set forth therein
(the “Master Agreement” and “Asset Purchase
Agreement”); and
WHEREAS, the Parties desire to
terminate the Distribution Agreement and enter into this Agreement
under which Lifecor agrees to supply ZOLL with all of its
requirements for Products and grant ZOLL an exclusive license to
the Lifecor Intellectual Property (as defined below) in the Field
of Use (as defined below) on the terms and conditions set forth
herein.
NOW, THEREFORE, in consideration of
the premises and the mutual covenants hereinafter set forth, and
for other good and valuable consideration the receipt of which is
hereby acknowledged, the Parties agree as follows:
1. DEFINITIONS
. As used in this
Agreement, the following terms, whether used in the singular or
plural, shall have the following meanings.
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1.1.
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“
Availability Date ” shall have the meaning set forth
in Section 5.1 of this Agreement.
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1.2.
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“
Confidential Information ” shall have the meaning set
forth in Section 13.1 of this Agreement.
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1.3.
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“
ZOLL ” shall have the meaning set forth in the
preamble of this Agreement and shall include ZOLL’s
wholly-owned subsidiaries.
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1.4.
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“
Effective Date ” shall have the meaning set forth in
the preamble of this Agreement.
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1.5.
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“
Equivalent Product ” means any product, other than a
Product, which (a) is substantially the same as any of the
Products or (b) has substantially the same external
appearance, base function and internal components of any of the
Products or is functionally equivalent thereto.
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1.6.
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“
Field of Use ” shall mean all applications for
inpatient use in hospitals, clinics or other similar short term
health care facilities.
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1.7.
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“
Intellectual Property Rights ” shall mean trade
secrets, patents, copyrights, trademarks, trade dress, know-how and
similar rights of any type under the laws of any governmental
authority, including without limitation, all applications and
registrations relating to the foregoing.
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1.8.
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“
Lifecor ” shall have the meaning set forth in the
preamble of this Agreement and shall include Lifecor’s
wholly-owned subsidiaries.
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1.9.
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“
Lifecor Intellectual Property ” means any Intellectual
Property Rights, inventions and discoveries and invention
disclosures (whether or not patented), other than the CSI Software
and CSI Patents (each as defined in Section 5.5 below), used
in the design, development, manufacture, operation, maintenance
and/or support of the Products. The Lifecor Intellectual Property
includes, but is not limited to, the Intellectual Property Rights
set forth in Schedule A attached hereto.
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1.10.
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“
Marks ” shall mean the trademarks listed on
Schedule A-1 attached hereto.
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1.11.
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“
Party ” shall mean ZOLL or Lifecor, and
“Parties” means both together.
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1.12.
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“
Patent Cross-License Agreement ” shall have the
meaning set forth in the recitals of this Agreement.
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1.13.
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“
Product ” shall mean a product set forth in
Schedule B hereto, any updated or revised versions of such
product or any other product developed by Lifecor pursuant to
Section 5.2 below, and all documentation provided by Lifecor
with any of the foregoing.
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1.14.
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“
Purchase Order ” shall have the meaning set forth in
Section 2.1 of this Agreement.
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1.15.
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“
Regulatory Approval ” shall mean filing for and
receipt of all regulatory agency registrations and approvals
required for the manufacture, marketing and sale of any Product for
use in the Field of Use in the Territory.
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1.16.
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“
sell ”, “ sale ”, “
buy ”, “ purchase ” (and
derivatives thereof) as used with regard to any Product shall
include the sale, rental, lease (and derivatives thereof) of such
Product.
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1.17.
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“
Specifications ” shall have the meaning set forth in
Section 2.4 of this Agreement.
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1.18.
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“
Sub-distributor ” shall mean an entity which is
appointed by ZOLL for the purposes of selling, marketing,
distributing and performing related functions relating to any
Product in all or any part of the Territory.
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1.19.
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“
Term ” shall have the meaning set forth in
Section 9 of this Agreement.
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1.20.
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“
Territory ” shall mean the world.
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2. SUPPLY OF PRODUCTS
.
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2.1.
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Supply of
Products; Purchase Orders . From time to time, ZOLL may request Lifecor to
sell Products to ZOLL and Lifecor agrees to manufacture and sell
such Products to ZOLL prior to March 29, 2009. Lifecor shall
accept and fill all purchase orders submitted by ZOLL hereunder
consistent with each forecast delivered pursuant to
Section 2.7 (each a “Purchase Order”), which may
be submitted in electronic format. Subject to the provisions of
this Agreement, Lifecor shall allocate manufacturing capacity,
components and parts for manufacture of the Products in sufficient
quantity to meet the Purchase Orders. Lifecor acknowledges and
agrees that the scheduled delivery date stated in a Purchase Order
is a material term of this Agreement and that time is of the
essence for all deliveries of Products. Lifecor shall use
commercially reasonable efforts to deliver all Products on such
scheduled delivery date. Without limiting ZOLL’s other rights
and remedies, including, but not limited to, canceling the
applicable Purchase Order without any penalty or payment to
Lifecor, if Lifecor is unable to deliver the quantity of Products
specified in a Purchase Order on the delivery date set forth
therein, Lifecor shall notify ZOLL as soon as
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Lifecor becomes aware of the delay,
and shall state in such notice the date on which delivery can be
made and, at its expense, take all commercially reasonable steps to
expedite shipment of such Products.
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2.2.
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Manufacture
of Products . Lifecor
shall manufacture the Products using such production methods, raw
materials, quality control systems and techniques (a) which
comply with (i) a quality management system that meets the
requirements specified by the International Organization for
Standardization 9001:2000, and (ii) any and all rules,
standards, regulations, conditions and guidelines set forth in any
approvals obtained by Lifecor under Section 5.1(b) below and
(b) as are necessary to meet its obligations under this
Agreement. Lifecor will assure that the Products conform in all
respects with the applicable Specifications (as defined below).
Lifecor will maintain proper quality control procedures in its
facilities and during manufacturing and shipping activities in
connection with this Agreement. Lifecor will, in addition to any
quality control requirements, monitor production and delivery
schedules and keep ZOLL advised as to the compliance with such
schedules. Upon request, Lifecor will confirm shipping schedules on
all open Purchase Orders.
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2.3.
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Delivery . Lifecor shall ship the Products F.O.B.
Lifecor’s factory and ensure that such Products are shipped
on the applicable scheduled shipment date and in accordance with
the instructions. Title and risk of loss will pass to ZOLL upon
Lifecor’s delivery of the Product to the carrier.
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2.4.
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Non-Conforming or Defective Products
. ZOLL will be entitled to inspect
all Products delivered and reject any that contain any defect in
design, materials or workmanship or that do not conform with any
applicable Product standards, requirements and specifications (the
“Specifications”). Neither the conduct of, nor failure
to conduct, inspections shall in any way affect the application or
interpretation of Section 8. If any Products fail to meet any
of the warranties stated in Section 8, ZOLL will give Lifecor
notice of the defective Products and Lifecor shall, at
Lifecor’s option and expense: (a) replace such Products
with new Products that comply with this Agreement and the
applicable Specifications; or (b) issue ZOLL a refund or
credit in the full amount of the price of the defective units of
Products and all shipping and insurance charges associated
therewith, provided that, in each case, ZOLL shall return the
non-conforming Products to Lifecor at Lifecor’s expense. In
addition, without limiting the foregoing, if ZOLL determines that
any Products are defective and such Products are returned to
Lifecor, Lifecor will provide ZOLL with a defect and failure
analysis, a corrective action plan to prevent the recurrence of
such defects and technical and other support as may be necessary to
resolve such defects.
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2.5.
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No Sales to
Others . Except as
otherwise permitted in Section 2.1 above, Lifecor agrees that
during the Term, Lifecor shall not, directly or indirectly,
manufacture, market, sell or distribute any Product or Equivalent
Product in the Territory and Field of Use.
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2.6.
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Transition
Products . The preceding
notwithstanding, the parties acknowledge that as of the Effective
Date Lifecor does not manufacture a saleable version of the Product
designed specifically for the Field of Use. The parties further
acknowledge that as of the Effective Date Lifecor manufactures a
saleable version of the Product designed for applications outside
of the Field of Use (the “Out of Hospital Product”).
Accordingly, the parties agree that prior to the actual date on
which a saleable version of the Product designed specifically for
the Field of Use is made available for ZOLL to sell to third
parties, Lifecor will supply, and ZOLL shall accept, delivery of
Out of Hospital Products in lieu of Products; provided that all of
terms and conditions set forth in Sections 2, 3.1, 3.2, 7.2, 7.3,
7.4, 8, 10, 11 and 13 of this Agreement relating to Products shall
be deemed to apply to any such Out of Hospital Products supplied to
ZOLL.
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2.7
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Rolling
Forecasts . ZOLL shall
establish a rolling 12 month sales forecast prior to the target
Availability Date and shall update that forecast quarterly. In
addition, the first three (3) months of each forecast shall
represent a binding purchase commitment by ZOLL.
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3. LICENSES
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3.1.
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Exclusive
Nature of Rights .
Subject to the terms and conditions of this Agreement, Lifecor
agrees that ZOLL shall have the exclusive right to market,
distribute and sell the Products in the Territory for use in the
Field of Use during the Term of this Agreement. Notwithstanding the
foregoing, nothing in this Agreement shall be construed as limiting
in any manner the marketing or distribution activities of Lifecor
of Products outside of the Field of Use.
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3.2.
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Trademark
License . Products
distributed pursuant to this Agreement may be named and branded
with one or more Marks. ZOLL acknowledges that Lifecor owns the
Marks and all rights relating thereto, including without limitation
any and all goodwill associated with the Marks. Lifecor grants ZOLL
the non-exclusive right and license to use and display the Marks
solely in connection with any marketing, distributing, promoting
and/or selling of Products until March 29, 2009 (the
“Trademark License Termination Date”). Lifecor shall be
referenced as the owner of such Marks in any marketing materials.
If Lifecor reasonably determines that ZOLL is using a Mark in a
manner that is or may be detrimental to Lifecor’s interest,
Lifecor may issue reasonable instructions to ZOLL concerning the
manner in which ZOLL may continue to use the Mark. ZOLL shall use
commercially reasonable efforts to comply with such instructions,
but in no event will ZOLL be required to destroy or cease using any
printed materials prepared prior to its receipt of such
instructions. Use of any Mark by ZOLL under this Agreement shall
inure to the sole benefit of Lifecor. ZOLL will not acquire any
interest in any of these Marks by virtue of this Agreement, its
activities under it, or any relationship it has with Lifecor,
except the rights granted pursuant to this Section. ZOLL agrees not
to file in any jurisdiction any trademark applications which
include in whole or in part any Mark.
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3.3.
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Licenses to
Lifecor Intellectual Property . Lifecor hereby grants ZOLL a fully-paid,
royalty-free, transferable, perpetual, irrevocable, exclusive,
worldwide right and/or license under any and all Lifecor
Intellectual Property to (a) copy, distribute, display,
perform and modify (including the right to create derivative works
of) the Lifecor Intellectual Property and (b) to use the
Lifecor Intellectual Property, including, without limitation, the
right to make, have made, use, sell, have sold, offer to sell,
rent, import or have imported, and/or lease the Products and any
other products which practice or embody, or are configured for use
in practicing, the Lifecor Intellectual Property or any inventions
covered by the claims of any patents included in the Lifecor
Intellectual Property, in each of the cases described in
subsections (a) and (b) in connection with
(i) manufacturing, selling, distributing, supporting,
maintaining, marketing and promoting the Products in the Field of
Use and/or (ii) improving, enhancing, updating, revising or
otherwise modifying the Products (any resulting improvements,
enhancements, updates, revisions or modifications, “ZOLL
Modifications”). As between ZOLL and Lifecor, ZOLL shall own
all right, title and interest in and to any and all ZOLL
Modifications; provided that ZOLL agrees that it will exercise its
rights in the ZOLL Modifications only for applications in the Field
of Use. ZOLL may sublicense the rights granted to it under this
Section 3.3. Notwithstanding any of the foregoing to the
contrary, Lifecor may use the Lifecor Intellectual Property to
manufacture and sell Products to ZOLL in accordance with
Section 2 above.
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3.4.
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Delivery of
Lifecor Intellectual Property; Access to Lifecor
Employees .
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(a)
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Lifecor will
deliver to ZOLL a full and complete copy, in hardcopy and/or
electronic format, of all tangible embodiments of the applicable
Lifecor Intellectual Property, including, without limitation,
documents, drawings, specifications and programs (“Product
Intellectual Property Materials”), within 30 business days
after the Availability Date. Lifecor will deliver ZOLL updates to
such Product Intellectual Property Materials on no less than a
calendar quarterly basis to reflect changes in or additions to the
Product Intellectual Property Materials.
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(b)
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Lifecor will,
upon any reasonable prior written request from ZOLL, make its
employees and consultants with adequate skills and knowledge
regarding the Lifecor Intellectual Property available to ZOLL to
participate in training and/or knowledge transfer meetings
(“Knowledge Transfer Meetings”) regarding the design,
development, manufacture, operation, support and/or maintenance of
the Products; provided, that each such Knowledge Transfer Meeting
is reasonable in scope and duration. In connection with the
foregoing, Lifecor will (i) cooperate with and give reasonable
assistance to ZOLL and (ii) use commercially reasonable
efforts to cause such employees or consultants to cooperate with
and give their reasonable assistance to ZOLL.
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4. PRODUCTS .
The Parties may add Products to
Schedule B and/or may remove any product(s) therefrom by
mutual written agreement.
5. LIFECOR’S
RESPONSIBILITIES .
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5.1.
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Saleable
Version of Product; Regulatory Approvals . Lifecor shall (a) develop and manufacture
a saleable version of the Product designed specifically for the
Field of Use, and (b) obtain all requisite U.S. Food and Drug
Administration approvals necessary or advisable for the sale and
commercialization of such specifically-designed Product except for
approvals which are necessary or advisable solely as a result of a
Product embodying pacing or easier download functionality. The date
on which such saleable version shall be made available for ZOLL to
sell to third parties shall be no later than June 30, 2004
(the “ Availability Date ”).
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5.2.
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Improved
Versions of Product It is
expected that Lifecor will, at its expense, continue to develop and
incorporate improved and/or updated versions of the hardware and
software components into the Product for non-Field of Use
applications, which may potentially incorporate biphasic technology
licensed from ZOLL subject to the Patent Cross-License Agreement
until March 29, 2009. Lifecor will, at ZOLL’s expense,
develop and/or incorporate improved versions of the software and/or
hardware components into the Product for Field of Use applications
as requested in writing by ZOLL on mutually agreed upon terms and
conditions until March 29, 2009; provided,
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