Exhibit 10.3
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the “Agreement”) is made and entered into as of
this 16th day of March 2007 (the “Effective Date”), by and among JMAR
Technologies, Inc., a company organized and existing under the laws of the State
of Delaware (the “Seller”), and Gatan, Inc., a company organized and existing
under the laws of the State of Pennsylvania (the “Buyer”) (Seller and Buyer are
together referred to herein as the “Parties”).
WITNESSETH:
WHEREAS, Seller owns or is in lawful possession of property, fixed assets,
inventories, work-in-progress, spare parts, records, goodwill, know-how,
intellectual property, and other interests used by Seller in, and associated
with, the activities and operations of manufacturing, sales and services of the
x-ray microscopy business (collectively, “Assets”); and
WHEREAS, Seller desires to sell to Buyer, and Buyer desires to buy from Seller,
all such Assets owned by Seller and identified herein in Exhibit A (“Purchased
Assets”) and in Exhibit C (“Patents”); and
WHEREAS, Seller desires to confer to Buyer, and Buyer desires to accept from
Seller, all such Assets loaned to Seller and identified in Exhibit B (“Loaned
Assets”);
WHEREAS, Seller desires to sell to Buyer, and Buyer desires to buy from Seller,
all patent material related to the x-ray microscopy (“XRM”), including but not
limited to issued patents, patent applications, and provision applications, as
further described in Exhibit C (“Patents”);
NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants, agreements and other good and valuable consideration of the Parties
hereinafter set forth, the Parties hereto, intending to be legally bound, do
hereby agree as follows:
Assets

  1.   Seller hereby grants to Buyer all of Seller’s right, title, and interest
in the Assets.     2.   In the event that the consent or approval of a third
party is required for such transfer of Assets, or to complete patent
applications for such Assets, Seller agrees to use its best efforts to obtain
the requisite consent or approval.     3.   All costs associated with applying
for and maintaining patents shall hereinafter be at Buyer’s expense.     4.  
Buyer and Seller agree and acknowledge that the Loaned Assets are the property
of the federal government, and were lawfully loaned to Seller. If the Loaned
Assets are required to be returned to the federal government within three
(3) years of the Effective Date, Buyer may deduct the depreciated replacement
value from monies owed to Seller. Such depreciated replacement value shall be
calculated by determining the fair market value of a similar replacement
product, and linearly depreciating the product beginning on the Effective Date
and ending five (5) years thereafter.     5.   Seller agrees to assist Buyer in
obtaining inventor rights and signatures required for transfer of intellectual
property and completing patent applications. For work amounting to less than
four (4) hours per calendar quarter, no compensation will be due Seller. Seller
shall be entitled to reimbursement of reasonable wages and administrative fees
for work in excess of four (4) hours that is commissioned or requested by Buyer.

 

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Payments

  1.   Within five (5) business days of execution of the Agreement, Buyer shall
pay to Seller $100,000.00.     2.   Buyer agrees to pay to ship the Assets, plus
the reasonable cost of Seller’s employees working on the Assets from the
Effective Date until receipt and acceptance of the Assets by Buyer. The
following conditions shall apply:

  a.   Seller shall submit invoices to Buyer detailing the reasonable costs
associated with the packing and shipment of the Assets, employee wages, and
employee travel expenses. No overhead charges of Seller shall be reimbursed by
Buyer. Buyer will reimburse Seller up to two (2) weeks of employee wages for
packing and shipment work performed prior to the signing of the Agreement.    
b.   Buyer shall reimburse Seller for such reasonable expenses within twenty-one
(21) days following receipt of invoices from Seller.     c.   In no such event
shall Buyer be obligated to reimburse Seller or pay any amount in excess of
$50,000.00 for the costs and expenses described herein.     d.   Seller shall
use its best efforts to deliver the Assets, including all documentation,
drawings, control software and related materials, to Buyer immediately following
the Effective Date.

  3.   Buyer shall pay to Seller $500,000.00 following the installation and
successful operation of the XRM. The following conditions shall apply:

  a.   The criteria for “successful operation” shall be deemed to occur when the
microscope acquires an image with at least 80nm resolution for five
(5) consecutive business days.     b.   Seller shall be responsible for
establishing successful operation of the XRM at Buyer’s chosen place of
business, and Buyer shall cooperate fully in this regard.     c.   Buyer shall
make such payment to Seller following successful operation and within twenty-one
(21) days of receipt of Seller’s invoice.

  4.   Buyer shall pay to Seller $100,000.00 if and when the XRM reaches the
flux and resolution target. The flux and resolution target shall be deemed
reached when the XRM can acquire an image with spatial resolution of at least
40nm, and in a separate experiment, demonstrate an average flux of 5 detected
soft-x-ray photons/s/pixel, assuming 20um pixels, 1000X magnification and no
sample present.

Royalties

  1.   Buyer shall pay to Seller five percent (5%) of the revenue received by
Buyer pursuant to completed sales of x-ray microscopes (“Royalties”) for four
(4) years (“Royalty Period”) following Buyer’s first sale of an x-ray microscope
derived from the Assets to a third-party.     2.   Buyer shall have no
obligation to pay Royalties upon the conclusion of the Royalty Period.     3.  
Buyer shall pay Royalties to Seller annually, in arrears, in January of each
year along with supporting documentation.     4.   Buyer and Seller agree and
acknowledge that the intent hereunder is for Seller to earn Royalties for
technologies developed to feasibility by Seller. This includes the complete
x-ray microscope (source, room temperature stage, microscope optics, camera,
acquisition software) sufficient to produce single images, a soft x-ray
microscope source based on laser plasma x-ray sources, or a soft x-ray
microscope without the source.

 

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  5.   Royalties shall not be due on any existing product or product lines of
Buyer or its affiliates. Any revenue derived from the products of Buyer that are
sold into or included in x-ray microscopy or electron microscopes shall not be
subject to Royalties. This includes cryotransfer holders and stages, tomography
acquisition software, analysis and visualization software, x-ray cameras sold
separately from the original x-ray microscope sale, and specimen preparation
products.     6.   Revenues derived from service, spares, and installations are
not subject to Royalties.     7.   Seller agrees not to produce x-ray
microscopes or sources for x-ray microscopes, nor enable or assist others to do
so, for the duration of the Royalty Period, provided that Buyer launches or
intends to launch a commercial soft-x-ray microscope product within four
(4) years after execution of this Agreement.     8.   In the event of any
transfer or assignment by Buyer of any technology subject to Royalties
hereunder, Seller shall be entitled to the Royalties that Seller would have
received had the sales been made by Buyer.

Supplier Arrangement

  1.   Seller shall serve as the exclusive laser supplier for Buyer’s soft x-ray
nCT product line during the Royalty Period.     2.   Seller shall supply such
lasers to Buyer at a price discounted from that which Seller routinely offers in
the marketplace, and in no such event shall the annual average gross margin of
the laser system on sales to Buyer exceed forty percent (40%).     3.   In the
event that Seller is not able to match the technical or commercial
specifications required by Buyer within thirty (30) days following notice by
Buyer of a commercial alternative meeting such specifications, then the
exclusivity described herein shall terminate.     4.   In the event that Seller
is unable to manufacture the laser described herein, Seller shall provide Buyer
with access to the Seller’s design and manufacturing information, and shall
cooperate fully with Buyer’s efforts related to obtaining a replacement. Seller
shall grant to or obtain for Buyer, at no cost to Buyer, any license necessary
for the supply of such laser to Buyer.     5.   Buyer shall pay to Seller
$318,750.00, or an OEM discount of fifteen percent (15%), whichever is less, for
the first laser system purchased from Seller. Buyer shall place such order in
2007, and may change the specifications of the required laser while preserving
the discount rate of fifteen percent (15%).     6.   Buyer and Seller agree and
acknowledge that this laser is not a complete Brightlight 75 system and will not
achieve similar performance. This shall be a prototype system capable of
supplying approximately 50W of power. Seller shall not be responsible for
upgrading this system beyond its existing capabilities (i.e., those demonstrated
and discussed during the due-diligence period), but shall remain responsible for
servicing the laser to maintain current capability. Seller shall provide
warranty service on the laser supplied with the prototype provided for a period
of two (2) years following the Effective Date. This warranty service will cover
parts and shipping costs.     7.   Buyer acknowledges that, following
demonstration of successful operation, the Seller provides the system in “As-Is”
condition. No warranty is provided by the Seller on any parts of the system
except the laser.

 

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Governing Law: This Agreement shall be governed by, construed, and enforced in
accordance with the laws of the State of California. Any legal suit, action or
proceeding shall be brought in Alameda County, California.
Indemnifications: Each party (“Indemnifying Party”) shall indemnify the other
(“Indemnified Party”) against any claim, liability, or loss (including
reasonable attorney’s fees and court costs) resulting from injury to or death of
any person, any damage to property, or loss of revenues due to (i) the acts or
omissions of Indemnifying Party, its contractors, subcontractors, agents or
representatives; (ii) any breach of this Agreement by Indemnifying Party, its
contractors, subcontractors, agents or representatives; or (iii) the negligence
or willful misconduct of Indemnifying Party or its contractors, subcontractors,
agents, or representatives. In the event that Indemnified Party seeks
indemnification hereunder, Indemnifying Party shall have no obligation to
indemnify as provided herein unless Indemnified Party provides prompt written
notice to Indemnifying Party of any such claims and allows Indemnifying Party
the right (but not the obligation) to control the defense, negotiations, and/or
settlement of such claim. Indemnified Party and its counsel may participate in
such proceedings at it own expense but not control such proceedings,
negotiations, or defense as counsel of record if Indemnifying Party chooses to
control the defense. In such event that Indemnifying Party chooses to control
the defense, Indemnified Party shall not admit any liability, settle,
compromise, pay, or discharge any such claim, demand, suit or proceeding without
the prior written consent of Indemnifying Party, which will not be unreasonably
delayed, conditioned, or withheld.
Press Releases: Seller will not include direct or indirect references to Buyer
in public forums without written authorization, except for Seller’s disclosure
obligations under federal securities laws which may require disclosure of
Buyer’s name.

 

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Exhibit A
Purchased Assets
The functional x-ray microscope shall include the following materials:

                  Item                 #   Description   Model   Use   Manual /
Software
1
  Small chiller   Merlin m33   cools pumps, power
meter   no
 
               
2
  Small breadboard   Newport 1x4x2”   hold scrolls   no
 
               
3
  Dustfilter x2   Edwards a4421500       no
 
               
4
  XRM vacuum / gas system           custom software
 
               
5
  XRM laser optics spares           no
 
               
6
  XRM laser beam delivery
system   Assorted
optomechanics + CVI
optics       no
 
               
7
  YAG Laser   BriteLight 75   Currently only ~50W
output power   manual
 
               
8
  Laser control computer +
beam viewer           no
 
               
9
  Laser electronics rack   JMAR       no
 
               
10
  Laser oscilloscope   Tektronix TDS694C   x-ray diode
monitoring   no
 
               
11
  Laser optical table   3x4x2” Newport + legs       no
 
               
12
  HeNe Laser + mount   Melles Griot 05lhr111   rough alignment tool   no
 
               
13
  Power meter   Gentec PS-300V3,
serial 153293   main dump   no
 
               
14
  IR viewer           no
 
               
15
  Monitor + 2 cameras   Wat-137lh, IAE,
AN064pn/pp   alignment tools   no
 
               
16
  Stage encoder readouts x8   Renishaw   sample chamber   manuals
 
               
17
  Stage driver box   Nanomotion   sample chamber   manuals, software
 
               
18
  Fiber light illuminator   X-Cite 120   for integrated VLM   manual
 
               
19
  VLM camera   Coolsnap ES,
A05K877004       manual, software
 
               
20
  Microscope “top”   Nikon, MBE74100       manual
 
               
21
  Sample vacuum chamber +
flanges + 2x cube   Lesker       no
 
               
22
  Source vacuum chamber   Lesker       no
 
               
23
  Vacuum bellows           no
 
               
24
  Nozzle xyz stage   Newfocus 9041   in source chamber   manuals
 
               
25
  3x pico motors   Serial 1181   in source chamber   manuals

 

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                  Item                 #   Description   Model   Use   Manual /
Software
26
  2x CCD   Prosilica   in source chamber   manuals, software
 
               
27
  CCD microscope objective   Edmund optics   in source chamber   no
 
               
28
  Custom in vacuum sample /optics
positioning   8x nanomotion
motors, 4 PI stages   in source chamber   manuals, software
 
               
29
  Custom x-ray camera
positioning system       on optical table   no
 
               
30
  Optical table + feet   4x8x1, Newport,
Melles Legs       no
 
               
31
  4x newfocus pico motor
ethernet controllers   Model 8752       manuals
 
               
32
  newfocus picomotor joystick x2   Model 8754       manuals
 
               
33
  Tektronix scope   TDS1012   shutter
synchronization   no
 
               
34
  Datalogger   Agilent 34970A   temperature
monitoring   manuals, software
 
               
35
  Delay generator x4   SRS DG535   synchronization   no
 
               
36
  XRM control computer   ATC   runs xrm vacuum
system sample
stages   no
 
               
37
  XRM imaging computer       runs x-ray ccd +
VLM ccd   no
 
               
38
  Hp ethernet switch           no
 
               
39
  Jet viewing computer           no
 
               
40
  2x UPS           manuals
 
               
41
  Custom shutter control box           no
 
               
42
  Custom XRM electronics box           no
 
               
43
  Digital laser power readout   Gentec duo, 151161       no
 
               
44
  Analog laser power readout   Gentec, TPM-300       no
 
               
45
  X-ray objective zone plate x2   Xradia       specs
 
               
46
  X-Ray condenser zone plate   Xradia       specs
 
               
47
  Partial x-ray condenser zone
plate x2   Xradia       specs
 
               
48
  Spare nozzles           no
 
               
49
  Spare x-ray windows           no
 
               
50
  table top mini clean room           no
 
               
51
  Desiccator           no
 
               
52
  Chiller            
 
               
53
  X-ray metrology equipment            

 

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Additionally, the following spare optics will be transferred:
Lenses
QTY3 LAP-75 0-15-1064
QTY4 LAPQ-75.0-15-1064
QTY1 PLCX-25.4-3683-UV-1064
QTY1 PLCC-25.4-51.5-C-1064/532
QTY1 PLCC-25.4-360.6-UV-1064
QTY2 PLCC-25.4-77.3-UV-1064
QTY1 PLCX-25.4-77.3-C-1064/532
Windows
QTY 2 W2-PW1-1025-1064-0
QTY 3 PW1-1025UV-1064-0
Mirrors
QTY 4 Y1-2037-60-S
QTY 2 Y1-2037-45-P
QTY 2 Y1-1025-0
QTY 2 Y1-2037-45-UNP
QTY 1 Y1-1064-2025-45-UNP
QTY 4 Y1-1025-45-UNP
Beam Splitter
QTY 1 BS1-1064-70-1025-45UNP
QTY 2 BS1-1064-50-1025-45P

 

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Exhibit B
Loaned Assets

                  Item #   Description   Model #   Use   Manual/ Software
1
  Scroll pump   Varian pts06001univ   pumps source   no
2
  Scroll pump   Varian pts03001univ   pumps sample   manual
3
  Turbo pump   Varian tv1001   pumps source   manual + software
4
  Oscilloscope   Lecroy waverunner 6KAA       manual
5
  X-Ray camera   Princeton Instruments       manual
 
      1300x1340 soft x-ray CCD,        
 
      J010022, property of JMAR        
 
      stickers + controller +        
 
      interface card        
6
  CCD microscope objective   Melles Griot 59lgn705       manual
7
  Laser power meter   Gentech, up55N, serial 167563       manual + software
8
  Laser beam profiler   Photon Inc, USBPro       manual
9
  Focusing lens xyz stage   Newfocus encoded staged +
picomotors   on optical table    

 

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*   Seller grants to Buyer a license to use all intellectual property related to
the “Rotating Shutter for Laser-Produced Plasma Debris Mitigation”, reference
#11/161,237, for non-x-ray microscopy applications.

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
indicated below:
Gatan, Inc

         
By:
  /s/ THOMAS G. CONNELLY
 
        Printed Name: THOMAS G. CONNELLY         Title: PRESIDENT         Date:
March 16, 2007    

JMAR Technologies, Inc

         
By:
  /s/ C. NEIL BEER
 
        Printed Name: C. NEIL BEER         Title: PRESIDENT & CEO
        Date: 3/16/2007