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EXHIBIT 10.45 ROYALTY AGREEMENT This Agreement (this "Agreement") is made as of
December 18, 2006, by and between Intersect Partners, LLC, a California limited
liability (“Intersect"), and Abdominis, Inc., a Delaware corporation
(“Abdominis”), (hereinafter referred to collectively as the “Parties” and
individually as a "Party"). RECITALS A. Intersect, pursuant to that certain
Intellectual Property Assignment Agreement, by and between Intersect and
Abdominis dated September 16, 2005 (the “Assignment”), has previously assigned
its interests in the Products and the Patent Rights to Abdominis. B. The Parties
now wish to specify in certain detail the consideration that is to be paid to
Intersect by Abdominis for the Assignment. NOW THEREFORE, in consideration of
the mutual obligations set forth in this Agreement, Intersect and Abdominis
hereby agree as follows: ARTICLE I DEFINITIONS 1.1 Affiliate. "Affiliate" shall
mean any entity which controls, is controlled by or is under common control with
another entity. 1.2 Net Proceeds. "Net Proceeds" shall mean the total proceeds
received from the sale of either the Patent Rights, or the sale of Products by
Abdominis, to a Third Party, less all reasonable costs incurred by Abdominis in
completing such sale, including but not limited to, attorneys' fees,
accountants’ fees, appraisers' fees and any commissions. 1.3 Net Sales. “Net
Sales” shall mean the total amount invoiced to Third Parties by Abdominis or its
Affiliates in connection with the sale, lease or use of a Product, Jess, to the
extent actually incurred: (a) allowances and adjustments credited or payable,
including credit for damaged, outdated and returned products; (b) trade, cost or
quantity discounts earned or granted; (c) transportation charges (including
insurance costs), sales taxes, excise taxes and duties, and other similar
charges; (d) wholesaler chargebacks; and (e) taxes on sale, transportation or
use paid by Abdominis. Net Sales shall be calculated in accordance with
Abdominis’ standard internal policies and procedures. Net Sales shall not
include sales by Abdominis to its Affiliates for resale, provided that if
Abdominis sells Product to an Affiliate for resale, Net Sales shall include the
amounts invoiced by

 

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such Affiliate to Third Parties on the resale of such Product. A “sale” shall
also include a transfer or other disposition for consideration other than cash,
in which case such consideration shall be valued at the fair market value
thereof. 1.4 Patent Rights. "Patent Rights" shall mean any of the patent
applications listed in Exhibit A attached to this Agreement; any continuing
applications thereof including divisions; but excluding continuations-in-part
except to the extent of claims entitled to the priority date of the parent case;
any patents issuing on these applications including reissues and reexaminations;
and any corresponding foreign patents or patent applications; all of which will
be automatically incorporated in and added to Exhibit A and made a party of this
Agreement 1.5 Product. "Product" shall mean any article, composition, apparatus,
substance, or any other material whose manufacture, use or sale would constitute
an infringement of any claim within Patent Rights, or any service, article,
composition, apparatus, substance, or any other material made, used, or sold by
or utilizing or practicing a method which would infringe a claim within the
Patent Rights. 1.6 Third Party. ''Third Party” shall mean any individual,
corporation, partnership, trust or other business organization or entity, and
any other recognized organization other than the parties hereto and their
Affiliates. ARTICLE II DISCLAIMER OF OWNERSHIP Disclaimer of Ownership.
Intersect irrevocably disclaims any ownership or other interest in or to the
Products and the Patent Rights and acknowledges that its sole rights with
respect to the “Products and the Patent” Rights is the right to receive the
payments set forth in Article III below. ARTICLE III CONSIDERATION TO BE
RECEIVED BY INTERSECT 3.1 Royalties. On all sales of Products by Abdominis in
territories where the Patent Rights exist, Abdominis shall pay Intersect a
royalty of two and one-half percent (2 1/2%) of Net Sales. If any Product is
manufactured and sold to a Third Party under license from Abdominis, Abdominis
shall pay Intersect two and one-half percent (2 1/2%) of Net Sales of Products
by such licensee, but not more than twenty-five percent (25%) of the amount
actually received by Abdominis from such licensee. If any Product is sold in a
series of transactions covered by more than one license or sublicense hereunder,
only one royalty shall be payable, based upon the Net Sales for the first
transaction in such series of transactions. 3.2 Reports and Payment. Abdominis
shall, and shall cause its Affiliates and sublicensees, to keep complete and
accurate records of Net Sales of all sales of Products with respect to which
royalties are payable pursuant to this Agreement for a period of three (3) years
following the year in which the sales were made. Forty-five (45) days following
the close of each fiscal quarter, Abdominis shall submit to Intersect a written
report setting forth its sales of Products, the Net Sales of such Products and
the calculation of the amount of royalties due and payable to Intersect for the
fiscal quarter just ended. Each report shall be accompanied by payment of the
amount of royalty shown by the report to be due in accordance with the
provisions of Article III hereof; provided, however, Abdominis shall accrue such
payment of royalties until such time as one

 

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of the patent applications set forth on Exhibit A has had a patent issued by the
U.S. Patent and Trademark Office containing a claim covering a Product at which
time such accrued royalties shall be paid to Intersect. In the event Abdominis
has not collected on an account after 180 days following delivery of an invoice
therefor, Abdominis shall include in its next sales report to Intersect a
statement of such failure to collect from such account and shall reduce the
amount of royalties otherwise payable under such report by (i) the amount of
royalties, if any, paid on account of such customer sates which have yet to be
paid by such customer and (ii) on account of any sales to such customer since
the most recent sales report. Abdominis shall pay all royalties due on such
customer’s account once such customer has paid Abdominis. 3.3 Diligence.
Abdominis shall have control over the development, manufacture and sale of the
Product and Intersect shall have no claim against Abdominis for any failure of
Abdominis to achieve any Net Sales or Net Proceeds. 3.4 Sale of the Rights to
the Patents. If at any time during the term of this Agreement Abdominis sells
its rights in one or more of the Patents to a Third Party, Abdominis, shall have
the Third Party assume Abdominis's obligations hereunder, and such Third Party
shall continue paying royalties to Intersect in accordance with Section 3.1 of
this Agreement 3.5 Sale of Abdominis. If at any time during the term of this
Agreement Abdominis shall be acquired by a Third Party (whether by purchase of
stock, purchase of substantially all assets, merger or consolidation), Abdominis
shall have the surviving entity assume Abdominis’s obligations hereunder, and
such entity shall continue to pay royalties to Intersect in accordance with
Section 3.1 of this Agreement. 3.6 Taxes. Any and all taxes levied by a proper
taxing authority and paid by Abdominis, or its Affiliates or sublicensees, on
account of royalties accruing to Intersect under this Agreement, remittable from
a country in which provision is made in the law or by regulation for withholding
of taxes, will be deducted from royalties paid· by Abdominis, provided that
proof of payment is secured and promptly sent to Intersect as evidence of such
payment. 3.7 Governmental Royalty Limitations. If the royalty rate specified
herein should exceed the permissible rate established in any country which
requires government approval for royalty remittance, the royalty rate for sales
in such country shall be adjusted to the highest legally permissible or
governmentally approved rate. 3.8 Payable in United States Funds. All royalty
payments shall be made in United States funds. When Products are sold for
currency other than United States dollars, the royalties will first be
determined in the foreign currency of the country in which those Products were
sold and converted into equivalent United States funds. Abdominis shall use the
exchange rate set out in the Wall Street Journal or similar publication on the
last day of the calendar quarter.

 

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ARTICLE IV RECORDS AND REPORTS 4.1 Records. Abdominis shall keep complete and
accurate records with respect to which the royalties are determined pursuant to
this Agreement for a period of three (3) years following the year in which such
payments were made. 4.2 Accountants Review. Intersect shall have the right to
nominate an independent accountant reasonably acceptable to Abdominis, to have
access to the records of Abdominis during reasonable business hours, not more
than one time per year for the purpose of verifying, at Intersect’s expense
(unless Abdominis’ payment accountings are more than five percent (5%) at
variance with Abdominis' records then Abdominis shall pay), the payments due to
Intersect. Abdominis may request that such accountant hold all information
received in confidence except as provided in the following sentence, including
requiring the execution of a Confidentiality Agreement. Such accountant shall
disclose to Intersect only information relating to the accuracy of the payment
reports and payments made according to this Agreement. ARTICLE V DURATION AND
TERMINATION 5.1 Duration of Agreement. Unless otherwise terminated by operation
of law or by acts of the Parties in accordance with the terms of this Agreement,
this Agreement is in force from the date first mentioned above and remains in
effect for the life of the last-to-expire patent in the Patent Rights. ARTICLE
VI CONFIDENTIALITY 6.1 Confidential Information. Confidential information shall
consist of any information designated as confidential and relating to the Patent
Rights and the Products, including the Reports and the payments made hereunder.
Intersect shall not use any such confidential information other than to exercise
its rights hereunder, or disclose confidential information to any third party
without the prior written consent of Abdominis. 6.2 Exceptions. The restrictions
set forth in Section 6.1 shall not apply to confidential information that (i)
becomes generally known to the public subsequent to the date hereof through no
wrongful act or omission of Intersect, (ii) is disclosed by Intersect pursuant
to the order or requirement of a court, administrative agency or governmental
body, provided, however, that Intersect shall provide prompt notice thereof to
Abdominis to enable Abdominis to seek a protective order or otherwise prevent
such disclosure, or (iii) has been approved for release in writing by Abdominis.
6.3 Remedies. Any breach of the restrictions contained in this Article VI is a
breach of this Agreement which may cause irreparable harm to Abdominis entitling
Abdominis to injunctive relief in addition to all legal remedies.

 

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ARTICLE VII MISCELLANEOUS 7.1 Entire Agreement. This Agreement sets forth the
entire agreement and understanding of the Parties relating to the subject matter
contained herein and merges all prior discussions between them. No claimed oral
agreement in respect hereto shall be considered as any part thereof. No
modification or claimed waiver of any of the provision hereof shall be valid
unless in writing and signed by authorized representatives of the Party against
whom such modification or waiver is sought to be enforced. 7.2 Severability.
Should any part or provision of this Agreement be held unenforceable or in
conflict with the law of any jurisdiction, the validity of the remaining parts
or provisions shall not be affected by such holding. 7.3 Assignability.
Intersect shall not assign this Agreement or its rights hereunder without the
prior written consent of Abdominis. Abdominis shall have the rights to assign
this Agreement subject to the terms of Section 3.4 and 3.5 herein. 7.4 Governing
Law. This Agreement shall be interpreted and construed and the legal relations
created herein shall be determined in accordance with the laws of the State of
California, without reference to choice of laws principles, but the scope and
validity of any patent or patent application will be governed by the applicable
laws of the country of the patent or patent application. 7.5 General Assurances.
The Parties agree to execute, acknowledge, and deliver all such further
instruments, and do all such other acts, as may be necessary or appropriate from
time to time in order to carry out the intent and purpose of this Agreement. 7.6
Disputes. If Intersect objects to Abdominis’ determination relating to payments,
intersect shall cause to be delivered to Abdominis, within thirty (30) days of
Abdominis' determination, written notice of such objection and its intent to
submit the matter to an independent accountant as otherwise provided in Section
4.2 herein. Intersect shall select an independent accountant with at least 10
years experience within thirty (30) days of receipt of delivery of the quarterly
statements provided in Section 3.2 herein by Abdominis. The accountant shall
undertake its review of all such records within sixty (60) days of commencement
of such accountant's review. The accountant shall deliver its decision to
Intersect and Abdominis. The decision rendered by the accountant as to the
determination in question shall be binding on the Parties. Intersect shall bear
all costs associated with the accounting, unless the accountant determines that
Abdominis underpaid the payment in question by more than five percent (5%), in
which case Abdominis shall bear the expenses of the accountant. 7.7 Arbitration.
Any controversy, dispute or claim arising out of or in connection with or
relating to this Agreement (other than payment determinations covered in Section
7.6 above) will be submitted by the Parties to arbitration by the American
Arbitration Association in Orange County, California in accordance with the
commercial rules then in effect for that Association before a single arbitrator.
The award rendered by the arbitrator shall include costs of arbitration,
reasonable attorneys' fees and reasonable costs for expert and other witnesses,
and judgment upon such award may be entered in any court having jurisdiction
thereof.

 

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7.8 Notices and Statements. Any notice, statement, or report permitted or
required to be given under the provision of this Agreement shall be in writing
signed by the Party giving such notice, statement or report and shall be sent to
the appropriate address given below: If to Intersect: With a copy to: If to
Abdominis: Intersect Partners 26429 Rancho Parkway South, Unit 140 Lake Forest,
California 91730 Attention: Manager Stradling Yocca Carlson & Rauth. 660 Newport
Center Drive Newport Beach, California 92660. Attention: Bruce Feuchter Fax:
(949) 823-5123 Abdominis, Inc. 26429 Rancho Parkway South, Unit 140 Lake Forest,
California 91730 Attention: Chief Executive Officer Any of the above addresses
can be changed upon ten (10) days written notice to the other parties. Any such
notice, statement or report that is dispatched by prepaid registered or
certified mail shall be deemed to have been duly given upon mailing thereof. ·
7.9 Waiver of Default. No waiver by a party of any provision of this Agreement
shall be deemed a waiver of any other provision hereof or of any subsequent
breach by a party of the same or any other provision. A Party’s consent to. or
approval of, any act shall not be deemed to render unnecessary the obtaining of
a Party’s consent to, or approval of, any subsequent act by the other Party. No
remedy or election as provided for in this Agreement shall be deemed exclusive
but shall, wherever possible, be cumulative with all other remedies at law or in
equity. 7.10 Binding Effect. This Agreement shall be binding on and inure to the
benefit of the Parties hereto and their respective heirs, successors and
permitted the assignees. 7.11 Counterparts. This Agreement may be executed in
several counterparts and such counterparts together shall constitute but one and
the same instrument. 7.12 Headings. The headings of the several sections are
inserted for convenience of reference only and are not intended to be a part of,
or to affect the meaning or interpretation of, this Agreement. 7.13 No Agency.
lntersect's and Abdominis’ activities hereunder shall be conducted as
independent contractors and no agency relationship shall exist between the
Parties. 7.14 Modification. This Agreement shall not be modified except by a
writing signed on behalf of each of the parties hereto. [Signature Page Follows]
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IN WITNESS WHEREOF, the parties have executed this Royalty Agreement as of the
day and year first above written. INTERSECT PARTNERS, LLC By: George Wallace,
Manager ABDOMINIS, INC. By: David Milne, Director

 

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EXHIBIT A Patent Rights Issued United States Patent Applications SPRIAL NUMBER
TITLE FILE DATE 11/263,302 Intragastric Space Filler 10/31/05 11/262,614
Intragastric Space Filler 10/31/05 11/315,925 Intragastric Space Filler 12/22/05
11/452,670 Intragastric Space Filler 6/14/06 PCT for Europe (waiting for
confirmation of serial number) For all the above 10/3/06 filed per patent
attorney END EXHIBIT A A-1

 

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AMENDMENT NO. 1 to ROYALTY AGREEMENT This Amendment No. 1, dated as of April 16,
2013 (the “Effective Date”), is made and entered into by and between ReShape
Medical, Inc. (formerly known as Abdominis, Inc.), a Delaware corporation
(“ReShape”) and Intersect Partners, LLC, a California limited liability company
(“Intersect”). RECITALS A. ReShape and Intersect (individually, a “Party”;
collectively, the “Parties”) previously entered into a Royalty Agreement,
effective as of December 18, 2006 (the “Original Royalty Agreement”). B. The
Parties desire to amend the Original Royalty Agreement as set forth in this
Amendment No. 1. Capitalized term(s) used but not defined in this Amendment No.
1 have the meaning assigned to such term(s) in the Original Royalty Agreement.
AGREEMENT The Parties therefore agree as follows: 1. Patent Rights. Section 1.4
of the Original Royalty Agreement is hereby amended to read in its entirety as
follows: "1.4 Patent Rights. “Patent Right” shall mean any United States and
foreign patents and applications listed in Amended Exhibit A, including
continuations, continuations-in-part, divisions, re-examinations, patents by
addition, patent term extension, renewals, reissues, and extensions thereof.” 2.
Reports and Payments. Section 3.2 of the Original Royalty Agreement is hereby
amended to read in its entirety as follows: "3.2 Reports and Payments. Abdominis
shall, and shall cause its Affiliates and sublicensees, to keep complete and
accurate records of Net Sales of all sales of Products with respect to which
royalties are payable pursuant to this Agreement for a period of three (3) years
following the year in which the sales were made. Forty five (45) days following
the close of each fiscal quarter, Abdominis shall submit to Intersect a written
report setting forth its sales of Products, the Net Sales of such Products and
the calculation of the amount of royalties due and payable to Intersect for the
fiscal quarter just ended. Each report shall be accompanied by payment of the
amount of royalty shown by the report to be due in accordance with the
provisions of Article III hereof; provided, however Abdominis shall accrue such
payment of royalties until such time as one of the U.S. or foreign patent
applications set forth in Amended Exhibit A or Patents Rights as defined herein
in Paragraph 1.4 is issued by the respective Patent Office and contains a claim
covering a Product, at which time such accrued royalties shall be paid to
Intersect.”

 

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3. Exhibit A. Exhibit A of the Original Royalty Agreement is hereby amended and
replaced in its entirety with the Amended Exhibit A attached to this Amendment
No. 1 4. Effective Dates. The amendments set forth in Paragraphs 1-3 of this
Amendment No. 1 shall be effective as of December 18, 2006, the effective date
of the Original Royalty Agreement. All other amendments set forth in this
Amendment No. 1 will be effective as of the Effective Date set forth above. 5.
Full Force and Effect. The Original Royalty Agreement, as amended by this
Amendment No. 1, remains in full force and effect. This Amendment No. 1 sets
forth the entire agreement, and supersedes any prior agreements, arrangements,
or understanding relating to the subject matter hereof. In the event of any
inconsistency between any provision of this Amendment No. 1 and any provision of
the Original Royalty Agreement, the provision of this Amendment No. 1 shall
govern. 6. Acknowledgement. For the avoidance of doubt, the Parties acknowledge
that the only Parties to the Original Royalty Agreement are ReShape (formerly
known as Abdominis, Inc.) and Intersect. 7. Counterparts. This Amendment No. 1
may be executed in counterparts, each of which shall be deemed to be an
original, and all of which taken together shall constitute one and the same
instrument. IN WITNESS WHEREOF, each of the Parties has caused this Amendment
No. 1 to be made and executed by its duly authorized officer as of the Effective
Date. ReShape Medical, Inc. Intersect Partners, LLC By: By: Richard Thompson
George Wallace Chief Executive Officer Manager

 

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AMENDED EXHIBIT A SERIAL NUMBER TITLE FILING DATE US 11/263,302 Intragastric
Space Filler 10/31/05 PCT/US2006/042336 Intragastric Space Filler 10/31/06 CA
2,640,554 Intragastric Space Filler 10/31/06 EP 06827093.3 Intragastric Space
Filler 10/31/06 JP 2008-538947 Intragastric Space Filler 10/31/08 JP 2009-14605
Intragastric Space Filler 10/31/08 US 11/262,614 Intragastric Space Filler
10/31/05 PCT/US2006/042711 Intragastric Space Filler 10/31/06 CA 2,638,988
Intragastric Space Filler 10/31/06 EP 06827314.3 Intragastric Space Filler
10/31/06 US 11/315,925 Intragastric Space Filler 12/22/05 PCT/US2006/042710
Intragastric Space Filler 10/31/06 CA 2,638,989 Intragastric Space Filler
10/31/06 EP 06827314.3 Intragastric Space Filler 10/31/06 US 11/315,925
Intragastric Space Filler 6/14/06 PCT/US2006/042710 Intragastric Space Filler
12/20/06 CA 2,638,163 Intragastric Space Filler 12/20/06 EP 06847847.8
Intragastric Space Filler 12/20/06 JP Patent No. 4900978 (JP 2008-547504)
Intragastric Space Filler 12/20/06 JP 2009-14632 Intragastric Space Filler
12/20/06 U.S. Patent No. 8,142,469 (US 11/768,152) Gastric Space Filler Device,
Delivery System and Related Methods 6/25/07

 

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SERIAL NUMBER TITLE FILING DATE US 13/074,956 Gastric Space Filler Device,
Delivery System and Related Methods 3/29/11 PCT/US2008/068058 Gastric Space
Filler Device, Delivery System and Related Methods 6/24/08 CA 2,691,530 Gastric
Space Filler Device, Delivery System and Related Methods 6/24/08 EP 08771842.5
Gastric Space Filler Device, Delivery System and Related Methods 6/24/08 JP
2010-515040 Gastric Space Filler Device, Delivery System and Related Methods
6/24/08 U.S. Patent No. 8,226,602 (US 11/694,536) Intragastric Balloon System
and Therapeutic Processes and Products 3/30/07 US 13/556,032 Intragastric
Balloon System and Therapeutic Processes and Products 7/23/12 PCT/US2008/058677
Intragastric Balloon System and Therapeutic Processes and Products 3/28/08 CA
2,680,124 Intragastric Balloon System and Therapeutic Processes and Products
3/28/08 EP 08732989.2 Intragastric Balloon System and Therapeutic Processes and
Products 3/28/08 JP 2010-501261 Intragastric Balloon System and Therapeutic
Processes and Products 3/28/08 JP 2013-43712 Intragastric Balloon System and
Therapeutic Processes and Products 3/6/13

 

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