exhibit_102.htm


    
      
        
                                                                                                                   Exhibit
10.2


             

            Confidential
Treatment Requested:

            Confidential
Portions of this document have been redacted and have been filed separately with
the Commission



          SETTLEMENT AND RELEASE
AGREEMENT

           

          This
Release Agreement (“Agreement”), is made
and entered into effective September 22, 2008, (the “Effective Date”) by
and between:

           

          The
Regents of the University of California (“The Regents”);
and

           

          Micrus
Endovascular Corporation (“Micrus”);

           

          Each of
The Regents and Micrus may be referred to herein individually as a “Party” or jointly as
the “Parties.”

           

          WHEREAS, Micrus and Boston
Scientific Corp. (“BSC”) and Target
Therapeutics, Inc. (and, collectively with BSC, “Boston Scientific”)
are parties to Boston
Scientific Corp. and Target Therapeutics, Inc. v. Micrus Corp., Civil
Action No. C04-04072 (JW), pending in the United States District Court for the
Northern District of California (hereinafter “the
Litigation”);

           

          WHEREAS, Micrus and Boston
Scientific have entered into a binding and enforceable Settlement and License
Agreement (“Settlement
Agreement”) between them to finally resolve and settle the Litigation and
avoid potential future litigations relating to the claims and causes of action
raised in the Litigation;

           

          WHEREAS, The Regents is the
owner of certain patents asserted by Boston Scientific against Micrus in the
Litigation;

           

          NOW THEREFORE, in
consideration of the following terms, releases, covenants, and conditions, the
Parties on behalf of themselves hereby agree as follows:

           

          
            	
                    1.

                  	
                    DEFINITIONS.  All
      definitions set forth in the Settlement Agreement (attached hereto as
      Exhibit A) shall apply to this Agreement including, without
      limitation, the definitions of “Affiliates,”
      “BSC Licensed
      Patents,” “BSC License,”
      “[***]
      Patents,” “[***] Patent,”
      “[***]
      patents,” “[***] Patents,”
      “Excluded
      Patents” and “Improvements.”

                  


          

           

          
            	
                    2.

                  	
                    NO ADDITIONAL RIGHTS
      GRANTED.  No rights
      other than those set forth in the Settlement Agreement are or will be
      conveyed by any Party to any other Party by virtue of the Settlement
      Agreement or this Agreement between Micrus and The Regents.  In
      particular, no license either express or implied nor any right of sale is
      granted under the Settlement Agreement or this Agreement to the [***] Patent,
      [***]
      patents, [***] Patents or any of the Excluded Patents identified in
      Section 1.1(C) of the Settlement
Agreement.

                  


          

           

          
            	
                    3.

                  	
                    MUTUAL RELEASES.
      

                  


          

           

          
            	
                     
      

                  	
                    3.1         
      Releases.  Each Party on its own behalf and on behalf of
      its respective predecessors, successors, direct or indirect parent or
      subsidiary companies, Affiliates, agents, representatives, attorneys,
      controlling persons, and assigns, waives and releases, acquits and forever
      discharges the other Party and each of its respective past or
      present

                  


          

           


          
            
              
                 

                


                [***]
Confidential Treatment Requested

                


              

               


            

            
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                    predecessors,
      successors, direct or indirect parent or subsidiary companies, Affiliates,
      agents, officers, directors, employees, representatives, attorneys,
      controlling persons, and assigns, and, in the case of Micrus only,
      Micrus’s and its Affiliates’ distributors, customers, and manufacturers
      (but only to the extent the manufacturers
      have made products for or on behalf of Micrus and not on behalf of a third
      party), from any and all claims, counterclaims, causes of action,
      demands, liabilities, losses, damages, costs, expenses, compensation, and
      all damages and liabilities of any kind or nature whatsoever, direct or
      indirect, whether in law or equity, whether now known, suspected or
      claimed, existing as of the Effective Date, which either were raised or
      could have been raised concerning any of the BSC Licensed Patents and the
      Micrus Patents and all patent and non-patent claims, counterclaims, and
      causes of action that either were raised or could have been raised by
      Boston Scientific and Micrus in the Litigation.  Further, The
      Regents waives and releases Micrus and each of its respective past or
      present predecessors, successors, direct or indirect parent or subsidiary
      companies, Affiliates, agents, officers, directors, employees,
      representatives, attorneys, controlling persons, assigns, distributors,
      customers, and manufacturers (but only to
      the extent the manufacturers have made products for or on behalf of Micrus
      and not on behalf of a third party)
      and distributors, customers, and manufacturers of Micrus’s
      Affiliates (but only to the extent the
      manufacturers have made products for or on behalf of Micrus’s Affiliates
      and not on behalf of a third party) from any royalty obligations
      which arise out of the BSC License, including without limitation, any
      past, present and future royalties that derive from any of the BSC
      Licensed Patents that are owned directly or indirectly by The Regents,
      including the [***] Patents.  Notwithstanding the foregoing, the
      releases herein do not apply to any acquirer of Micrus or its Affiliates or the Affiliates of such
      acquirer except for commercialized products, products in clinical
      trial, or products for which regulatory approval has been applied for in
      the United States, in each case, made, sold or furnished by Micrus prior
      to the Effective Date.  The releases do not apply to claims,
      counter-claims, defenses, or causes of action for the infringement or
      alleged infringement of any claims of the [***] Patents, the Excluded
      Patents, and the patents expressly excluded from the BSC Licensed Patents,
      including without limitation the [***] Patent and [***]
      patents.

                  


          

           

          3.2           Defenses
Preserved.  Neither this Agreement nor the Settlement Agreement
shall prejudice any defenses which a Party may assert in the event that the
other Party hereafter alleges infringement of the BSC License Patents or Micrus
License Patents, or raises any other claim or cause of action released under
this Agreement, including, without limitation, Micrus’s antitrust and state law
counterclaims raised in the Litigation.

           

          
            	
                    4.

                  	
                    CALIFORNIA CIVIL CODE §
      1542.  The foregoing releases extend to claims referenced
      in Section 3, which the releasing parties do not know or suspect to exist
      in their favor, which if known by them would have materially affected
      their decision to enter into this release.  The Regents and
      Micrus represent and agree that each has been fully advised by their
      respective attorneys regarding the contents of Section 1542 of the Civil
      Code of California.  Section 1542 reads as
    follows:

                  


          

           

          A GENERAL
RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW

           


          
            
              
                 

                


                [***]
Confidential Treatment Requested

                


              

               


            

            
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          OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.

           

          The
Regents and Micrus expressly waive and relinquish all rights and benefits under
the above Section 1542, and any similar law or common law principal of similar
effect in any jurisdiction with respect to the claims released
herein.  

           

          
            	
                    5.

                  	
                    COVENANTS NOT TO
      SUE.

                  


          

           

          
            	
                     
      

                  	
                    5.1

                  	
                    The Regents’ Covenant Not To Sue
      Micrus.  The Regents covenants not to sue Micrus and its
      Affiliates (in this Section 5.1), Affiliates expressly excludes any
      acquirer of Micrus or its Affiliates or the Affiliates of such acquirer)
      for alleged direct infringement, contributory infringement or inducement
      of infringement of the Excluded Patents and the patents expressly excluded
      from the BSC License Patents, including without limitation the [***]
      Patent and [***] Patents (to the extent that The Regents has or obtains
      any rights to sue on these patents) based on Micrus’s and its Affiliates’
      making, using, selling, offering for sale, importing or exporting medical
      devices or methods, on its own behalf (and not on behalf of any third
      party), that are [***], that are substantially equivalent in design and
      function to the design and functionality of Micrus’s accused products in
      the Litigation (identified in the attached Exhibit B). For
      clarification, this covenant not to sue with respect to the [***]
      Patents shall
      not extend to [***].

                  


          

           

          
            	
                     
      

                  	
                    5.2

                  	
                    The Regents’ Covenant Not To Sue
      Acquirer.  The Regents further covenants not to sue any
      acquirer of Micrus or its Affiliates or the Affiliates of such acquirer
      for alleged infringement of the Excluded Patents and the patents expressly
      excluded from the BSC License Patents, including without limitation the
      [***] Patent and [***] Patents (to the extent that The Regents has or
      obtains any rights to sue on these patents) based on the manufacture, use,
      sale, offer for sale, import, or export of medical devices, on its own
      behalf or its Affiliates’ behalf (and not on behalf of any third party),
      that are: (i) [***]; (ii) commercialized products, products in clinical
      trial, or products for which regulatory approval has been applied for in
      the United States, in each case, made, sold or furnished by Micrus and its
      Affiliates prior to the acquisition or merger, and future Improvements of
      those products; and (iii)

                  


          

           


          
            
              
                 

                


                [***]
Confidential Treatment Requested

                


              

               


            

            
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          substantially
equivalent in design and function to the design and functionality of Micrus’s
accused products in the Litigation (identified in Exhibit B). For
clarification, this covenant not to sue shall extend only to products meeting
all three criteria listed above. For clarification, this covenant not to sue
with respect to the [***] Patents shall
not extend to [***].

           

          
            	
                     
      

                  	
                    5.3

                  	
                    Mutual Covenants Not to
      Sue.  Each Party covenants not to sue the other Party or
      any of its Affiliates for any claim that such other Party’s or any of its
      Affiliates’ manufacture, use, sale, offer for sale, lease, importation,
      distribution or other transfer of its or its Affiliates’ licensed products
      and methods (as identified and defined in Sections 4.1 and 4.2 of the
      Settlement Agreement) constitutes contributory infringement or inducement
      of infringement of any BSC Licensed Patent or Micrus Licensed
      Patent.  This covenant not to sue contained in this Section 5.3
      does not apply to any acquirer of Micrus or its Affiliates or the
      Affiliates of such acquirer except with respect to (i) commercialized
      products; (ii) products in clinical trial; and (iii) products for which
      regulatory approval has been applied for in the United States, in each
      case, made, sold or furnished by a Party prior to the acquisition or
      merger, and future Improvements of those products.  For
      clarification, this covenant not to sue with respect to the [***]
      Patents shall
      not extend to [***].

                  


          

           

          
            	
                     
      

                  	
                    5.4

                  	
                    Combinations of Acquired
      Items.  End-users (including hospitals, physicians and
      their staff) and distributors for Micrus (but expressly excluding other
      medical device manufacturers) who obtain, directly or indirectly, a
      product subject to a covenant not to sue (granted in Sections 5.1 or 5.2)
      from Micrus or any of its Affiliates (“Acquired Item”)
      shall be immune from suit, under any given claim of the Excluded Patents
      and the patents expressly excluded from the BSC License Patents, including
      without limitation the [***] Patent and [***] Patents (to the extent that
      The Regents has or obtains any rights to sue on these patents) covering
      the combination of an Acquired Item with another Acquired Item or with one
      or more other items, for making, using, selling, offering for sale,
      importing, distributing, or otherwise transferring a combination of one or
      more Acquired Items with another Acquired Item or with one or more other
      items, but only to the extent that:  (i) the use, sale, offering
      for sale, importing, distributing or other transfer of such one or more
      Acquired Items by Micrus or its Affiliate would absent this Agreement,
      constitute direct infringement, contributory infringement or inducement of
      infringement of such claim, and (ii) such claim would not be infringed by
      such other items separate and apart from the combination with the Acquired
      Items. The determination of infringement in (i) above shall assume the
      existence of any necessary knowledge or intent required to constitute
      infringement.

                  


          

           

          
            	
                     
      

                  	
                    5.5

                  	
                    If
      The Regents assigns to a third party, or transfers to a third party any
      right, title, or interest in, any patents subject to any of the covenants
      in this Section 5, then the assigning party shall require that such third
      party is subject to the terms set

                  


          

           


          
            
              
                 

                


                [***]
Confidential Treatment Requested

                


              

               


            

            
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          forth in
this Section 5 as applicable to such transferred or assigned patent, right,
title, or interest.

           

          6.           NO
IMPLIED LICENSE.

           

          Except as
expressly set forth in the Settlement Agreement, no other rights or licenses are
granted to the Licensed Patents and all right, title and interest in the
Licensed Patents are reserved by the applicable Party.  Nothing in the
Settlement Agreement or in this Agreement shall be construed as conferring by
implication, estoppel, or otherwise any license or other right under any patent
or intellectual property of Micrus, Boston Scientific or The Regents, except as
expressly granted.  Nothing in the Settlement Agreement or in this
Agreement shall be construed as a warranty or representation that any acts
licensed or immunized hereunder will be free from infringement of the
intellectual property of a Party or third party, other than to the extent of the
licenses, covenants, and releases that have been expressly granted
herein.

           

          7.           MICRUS
SETTLEMENT PAYMENT.

           

          In
consideration for the releases and covenants granted by The Regents to Micrus
under Sections 3 and 5 of this Agreement, Micrus shall pay to The Regents a
one-time payment of one million, six-hundred and fifty thousand United States
dollars ($1,650,000) on or before the five (5) business days following the
Effective Date, which funds shall be transferred to The Regents’ bank account
identified below:

           

          Bank of
America

          1655
Grant Street

          Concord,
CA  94520

          Attn: OTT
Depository Account No.12337-17062

           

          ABA
Transit Routing No. 121000358

          Beneficiary
Name: Regents of the University of California

          SWIFT
Code: B of A US6S

           

          Fax your
remittance advice to: (510) 835-3705

          University
of California

          Office of
Technology Transfer

           

          
            	
                    8.

                  	
                    MISCELLANEOUS

                  


          

           

          
            	
                     
      

                  	
                    8.1

                  	
                    Representations and
      Warranties.

                  


          

           

          
            	
                       8.1.1
      

                  	
                    Each
      Party represents and warrants to the other Party that (i) it has the power
      and authority to execute and deliver this Agreement and to grant its
      releases, covenants and perform its obligations hereunder; and
      (ii) neither it, nor any of its Affiliates, will enter into any other
      agreement or understanding in conflict with the provisions contained in
      this Agreement.

                  


          

           


          
            
               


            

            
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            8.1.2 Each Party
represents and warrants that it: (a) is represented by competent counsel with
respect to this Agreement; (b) has read this Agreement in its entirety; (c) has
been advised of its rights and obligations with respect to the execution of this
Agreement; and (d) enters into this Agreement knowingly and
willingly.

           

          
            	
                     
      

                  	
                    8.2

                  	
                    Costs, Expenses, and Attorneys’
      Fees.  Each Party shall bear its own costs, expenses, and
      attorneys’ fees incurred in connection with this
  Agreement.

                  


          

           

          
            	
                     
      

                  	
                    8.3

                  	
                    Severability.  In
      the event that any provision of this Agreement is found to be prohibited
      by law and invalid, or for any other reason such provision is held
      unenforceable, in whole or in part, it shall be considered severable and
      shall be ineffective only to the extent of such prohibition, invalidity or
      unenforceability without invalidating or having any other adverse effect
      upon any other provision of the
Agreement.

                  


          

           

          
            	
                     
      

                  	
                    8.4

                  	
                    Entire
      Agreement.  This Agreement sets out the entire agreement
      and understanding between the Parties relating to its subject matter and
      supersedes all prior oral or written representations, agreements,
      arrangements or understandings between them relating to such subject
      matter.

                  


          

           

          
            	
                     
      

                  	
                    8.5

                  	
                    Governing
      Law.  This Agreement shall be governed by and interpreted
      under the laws of the State of California, without regard to conflict of
      laws.  In the event any action should be required to interpret,
      implement, modify, or enforce the terms and provisions of this Settlement
      Agreement, or to declare rights under the same, the prevailing party in
      such action shall recover from the losing party its reasonable attorney’s
      fees and costs.

                  


          

           

          
            	
                     
      

                  	
                    8.6

                  	
                    Amendments.  No
      amendment, change, modification or alteration of the terms and conditions
      of this Agreement or any appendix hereto shall be binding upon any Party
      unless in writing and signed by that
Party.

                  


          

           

          
            	
                     
      

                  	
                    8.7

                  	
                    Counterparts.  This
      Agreement will be effective upon the execution in counterparts via
      facsimile transmission, each of which shall be deemed an original, and all
      of which together, shall be deemed a single
  document.

                  


          

           

          
            	
                     
      

                  	
                    8.8

                  	
                    Notices.  Any
      notice required or permitted to be given or made under this Agreement by
      any Party shall be in writing, sent to such other Party at its address and
      fax number indicated below, or to such other address as the addressee
      shall have last furnished in writing to the addresser, and shall be
      effective upon receipt by the
addressee.

                  


          

           

          If to The
Regents:

          


          The
Regents of the University of California

          Office of
the General Counsel

          1111
Franklin Street, 8th Floor

          Oakland,
CA  94607-5200

          Attn:       P.
Martin Simpson, Esq.

                         
Rita Hao, Esq.

          Facsimile:  (510)
987-9763


          
            
               


            

            
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          UCLA
ORA-OIPA

          11000
Kinross Avenue

          Suite
200

          Los
Angeles, CA  90095-7231

          Attn:                      Emily
Loughran

          Facsimile:  (310)
794-0638

          


          If to
Micrus:

          


          Micrus
Endovascular Corporation

          Attn:
CEO

          821 Fox
Lane

          San Jose,
CA  95131

          


          
            	
                     
      

                  	
                    8.9

                  	
                    Survival.  The
      releases, covenants, agreements, representations and warranties made by
      the Parties herein shall survive the execution of this
      Agreement.

                  


          

           

          
            	
                     
      

                  	
                    8.10

                  	
                    Successors and
      Assigns.  The terms and conditions of this Agreement
      shall inure to the benefit of and be binding upon the respective
      successors and permitted assigns of the Parties.  Nothing in
      this Agreement, express or implied, is intended to confer upon any party
      other than the Parties hereto or their respective successors and permitted
      assigns any rights, remedies, obligations or liabilities under or by
      reason of this Agreement, except as expressly provided in this
      Agreement.

                  


          

           

          
            	
                     
      

                  	
                    8.11

                  	
                    Drafting.  All
      Parties and their counsel have reviewed and had the opportunity to
      contribute to the drafting of this Agreement, and the rule of construction
      providing that any ambiguities are to be resolved against the drafting
      Party shall not be employed in the interpretation of this
      Agreement.  This Agreement shall be construed as drafted by both
      Parties.

                  


          

           

          
            	
                     
      

                  	
                    8.12

                  	
                    Headings.  The
      headings of 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.

                  


          

           

          


           

          IN WITNESS WHEREOF, the
Parties have executed this Agreement as of the date set forth
below.

           

          
            
              	 
      	 
      	
                      THE
      REGENTS OF THE UNIVERSITY OF

                    
	 
      	 
      	
                      CALIFORNIA

                    
	 
      	 
      	 
      	 
      
	
                      Dated:
      September 22, 2008

                    	 
      	 
      	 
      
	 
      	 
      	
                      By:

                    	
                      /s/
      P Martin Simpson

                    
	 
      	 
      	 
      	
                      P.
      Martin Simpson, Jr.

                    
	 
      	 
      	 
      	
                      University
      Counsel

                    
	 
      	 
      	 
      	 
      
	 
      	 
      	
                      MICRUS
      ENDOVASCULAR CORPORATION

                    
	 
      	 
      	 
      	 
      
	
                      Dated:
      September 22, 2008

                    	 
      	 
      	 
      
	 
      	 
      	
                      By:

                    	
                      /s/
      Gordon Sangster

                    
	 
      	 
      	 
      	
                      Gordon
      Sangster

                    
	 
      	 
      	 
      	
                      Chief
      Financial Officer

                    


            

          

          



          
            
               


            

            
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          EXHIBIT
A

          


          SETTLEMENT
AGREEMENT

          


          


          


          



          
            
               


            

            
               


              
                

              

            

            
               


            

          


          EXHIBIT
B

          


          


          MICRUS
ACCUSED PRODUCT LIST