exv10w1






Exhibit 10.1




 




			
	**	 	
Information marked as “redacted**” has been omitted pursuant to a request for confidential
treatment and has been filed with the Securities and Exchange Commission.





CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT




     This Settlement and License Agreement (“Agreement”) is entered into between Synergetics USA,
Inc., and all of its Affiliates and successors-in-interest, on the one hand (“SYNERGETICS”) and
Alcon, Inc., and all of its Affiliates and successors in-interest, on the other hand (“ALCON”) as
of the day that both this Agreement and the Supply Agreement, in substantially the form appended
hereto as Exhibit C, are fully executed (“Effective Date”). SYNERGETICS and ALCON are referred to
herein individually as “Party” and collectively as “the Parties.” Entities other than the Parties
are referred to herein as “Third Party” or “Third Parties.”



     WHEREAS, the Parties are presently engaged in litigation in Synergetics USA, Inc. v. Alcon
Laboratories, Inc. and Alcon, Inc. No. 08-CV-3669 (DLC) pending in the United States District Court
for the Southern District of New York (the “New York Litigation”); and in Alcon Research, Ltd. v.
Synergetics USA, Inc. and Synergetics, Inc. No. 4:08-cv-00609-Y pending in the United States
District Court for the Northern District of Texas (the “Fort Worth Litigation”), both cases
sometimes referred to herein as “the Litigation”;



     WHEREAS, recognizing the expense, time, and uncertainty associated with continued litigation,
the Parties have agreed to settle the Litigation, without any party admitting liability to any
other party, on the terms and conditions set forth in this Agreement;



     WHEREAS, the Parties have agreed to effect such settlement by cross-licensing certain patent
rights specified herein and entering a supply agreement on terms provided herein;




			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 1 of 24






 









 






     NOW, THEREFORE, in consideration of the recitals stated above, and the agreements and promises
set forth below and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties agree as follows:



     I. Definitions



     1.0. The following capitalized terms used in this Agreement shall have the meanings set forth
below:



     1.1 “Affiliate” shall mean, as used in identifying the Parties above and when otherwise used
in conjunction with the name of a Party to this Agreement, all parents, subsidiaries or other
entities, now or hereafter, controlling, controlled by, or under common control with, the Party.
For these purposes, “control” (and its correlative meaning, “controlling,” “controlled by,” and
“under common control with”) means possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of the entity in question (whether through
majority ownership of voting securities or other ownership interests or by agreement, including
without limitation partnership or management agreements).



     1.2 “ALCON Products” shall mean any vitreoretinal surgical products as made, used, sold,
offered for sale, leased, licensed, imported, or otherwise disposed of by or on behalf of ALCON or
any of its predecessors in interest anywhere in the world, provided such products were commercially
available to end users in the United States on or before the Effective Date (including units of
such equipment actually made, used, sold, offered for sale, leased, licensed, imported or otherwise
disposed of after the Effective Date), whether under a trademark or service mark owned or licensed
by ALCON or otherwise, including without limitation: surgical consoles, light sources (of any kind,
whether



			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 2 of 24






 









 





integral or stand-alone), lasers (of any kind, whether integral or stand-alone), fiber
optic illuminators (some of which are also known as light pipes), laser probes, cutting probes, and
all surgical packs for use with ALCON’s surgical consoles (including without limitation all
variations of AccuPaks, Total Plus Packs, PicPaks and Custom Packs).




     1.3 “SYNERGETICS Products” shall mean any vitreoretinal surgical equipment as made, used,
sold, offered for sale, leased, licensed, imported, or otherwise disposed of by or on behalf of
SYNERGETICS or any of its predecessors in interest anywhere in the world, provided such products
were commercially available to end users in the United States on or before the Effective Date
(including units of such equipment actually made, used, sold, offered for sale, leased, licensed,
imported or otherwise disposed of after the Effective Date), whether under a trademark or service
mark owned or licensed by SYNERGETICS or otherwise, including without limitation: stand-alone light
sources, lasers, fiber optic illuminators (also known as light pipes), laser probes, and all
surgical packs for use in vitreoretinal surgery (including without limitation all variations of
I-Packs).



     1.4 “Commercially available to end users”, even though not capitalized, shall mean that a
purchaser of vitreoretinal surgical products could have ordered and obtained delivery of a product
and/or the feature in question in at least the United States of America and/or European countries.
Products that are only available to end users in prototypes, for clinical testing or evaluation, or
for product development purposes, and products that are available only under confidentiality
agreements or pursuant to a consulting relationship between the end user and the supplier are not
“commercially available to end users.”




			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 3 of 24








 









 





     1.5 “Licensed ALCON Patents” shall mean [redacted**], together with any United
States or foreign patents or patent applications claiming priority in whole or in part to any of
said patents or applications, including without limitation any reissues, renewals, extensions,
divisions, continuations, continuations-in-part, or reexaminations thereof, regardless of whether
or not any such reissues, renewals, extensions, divisions, continuations, continuations-in-part, or
reexaminations have been issued or filed as of the Effective Date.



     1.6 “Licensed SYNERGETICS Patents” shall mean [redacted**], together with any United States or
foreign patents or patent applications claiming priority in whole or in part to any of said patent
applications and patents, including without limitation any reissues, renewals, extensions,
divisions, continuations, continuations-in-part, or reexaminations thereof, regardless of
whether or not any such reissues, renewals, extensions, divisions, continuations,
continuations-in-part, or reexaminations have been issued or filed as of the Effective Date.



     1.7 “Supply Agreement” shall mean that certain agreement entered by and between the Parties
contemporaneously herewith under which Synergetics shall supply certain products to Alcon, as
further described in Section 4.2, and which shall be substantially in the form appended hereto in
Exhibit C.



     1.8 “Valid Claim” shall mean any unexpired claim of an issued patent contained in the Licensed
Patents of ALCON or SYNERGETICS that has not been held invalid or unenforceable by an unappealable
or unappealed decision of a court of competent jurisdiction.





 




			
	**	 	This information has been omitted pursuant to a request for confidential treatment and has
been filed separately with the Securities and Exchange Commission.


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 4 of 24






 









 










II. Release and Dismissal of the Litigation




     2.1. Dismissal. Within five (5) business days of SYNERGETICS’s receipt of the payment
specified in paragraph 4.1 below, the Parties shall file, in the U.S. District Court for the Fort
Worth Litigation and in the U.S. District Court for the New York Litigation, mutually agreed upon
stipulations of dismissal with prejudice and without costs in substantially the forms attached
hereto as Exhibits A and B. The Parties shall also take any such additional steps that may be
necessary to secure such dismissals of the Litigation, each at its own expense.



     2.2 Mutual Release.



     a. Each Party (“Releasor” as used in this Section 2.2) on behalf of itself and each of its
subsidiaries, and each of its successors and assigns, hereby forever releases, discharges and
acquits the other Party, its successors and assigns, and each of its or their respective officers,
directors, employees or agents (collectively, “Releasees” as used in this Section 2.2), from any
and all rights, claims, obligations, liabilities, causes of action, costs, damages, losses,
expenses, compensation, and demand of every kind or nature, whether known or unknown, that are
based in whole or in part on any conduct occurring on or before the Effective Date, including
without limitation:


          (i) claims that relate in any way to all claims that have been asserted or could have been
asserted in any respect whatsoever in the Litigation;


          (ii) claims that would rely upon, cite, describe, or otherwise reference the conduct or
actions of the Releasees, or any of them, that took place, or in the case of continuing conduct
began, any time before the Effective Date;



			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 5 of 24






 









 







          (iii) claims for reimbursement of litigation expenses, costs or attorney’s fees for or
relating in any way to the Litigation, including without limitation claims for duplicating
expenses, database costs, and any other costs or discovery expenses;


          (iv) any subrogated or derivative claims relating to the Litigation;


          (v) any claims for indemnification relating to the Litigation; and


          (vi) any and all claims arising out of the Releasees’ relationships with any Releasor,
including, but not limited to, any claims arising out of the Parties’ competitive relationship
through the Effective Date.



     b. The provisions of this Paragraph may not be disclaimed, voided or otherwise circumvented in
any manner including, but not limited to, by express allegation or averment in any pleading or
document filed with a court in any action brought against the Releasees, or any of them, after the
Effective Date, and any such attempt to disclaim, void or otherwise circumvent the provisions of
this Paragraph by Releasor shall be deemed a material breach of this Settlement Agreement for which
damages shall be recoverable by Releasees.



     c. Without limiting the foregoing, Releasors stipulate and agree that (i) no pre-settlement
conduct or behavior of the Releasees, or any of them, may be used to support any claim or action by
a Releasor against the Releasees, or any of them, after the Effective Date, (ii) no evidence of any
such conduct or behavior shall be offered into evidence in any claim or action brought by a
Releasor against the Releasees, or any of them, after the Effective Date, and (iii) any such
evidence would be
inadmissible if offered into evidence by the complaining Releasor in any such claim or action
brought against the Releasees after the Effective Date.




			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 6 of 24





 









 





     2.3 Global Scope. The releases set forth in Section 2.2, above, are global in scope and shall
be applied and enforced beyond the territorial boundaries of the United States to the Parties’
activities anywhere in the world.



     2.4 Express Reservation of Rights. Notwithstanding any of the other provisions of this
Agreement, including the releases set forth in Section 2.2 above, each Party expressly reserves the
right, in the event that such Party is accused of patent infringement in any future litigation, to
challenge, on any basis, the validity, enforceability or claimed infringement of the patent or
patents asserted against such Party, including without limitation the Licensed ALCON Patents, the
Licensed SYNERGETICS Patents, and any patents the Parties own or control now or may own or control
in the future.



     2.5 Confidential and Highly Confidential Discovery Material. The provisions of the applicable
protective orders of confidentiality entered into in the Litigation shall survive this Agreement
and Exhibits.



III. Covenants Not to Sue, Cross-Licenses and Enforcement




     3.1 ALCON’s Covenant Not to Sue. ALCON hereby covenants not to sue SYNERGETICS or
SYNERGETICS’s customers, distributors, resellers, or the end users of any SYNERGETICS Products,
other than its “Pinnacle 360°” product line, on any claim of patent infringement under any patents
owned or otherwise enforceable by ALCON as of the Effective Date based upon the manufacture, use,
sale, offer for sale, importation or other disposal of SYNERGETICS Products at any time after the
Effective Date. Patent infringement issues, if any, concerning the “Pinnacle 360°” product line or
products introduced in the United States or elsewhere after the




			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 7 of 24





 









 





Effective Date shall be addressed
using the Future Dispute Resolution procedure set forth in Article VII below.




     3.2 SYNERGETICS’s Covenant Not to Sue. SYNERGETICS hereby covenants not to sue ALCON or
ALCON’s customers, distributors, resellers, or the end users of any ALCON Products on any claim of
patent infringement under any patents owned or otherwise enforceable by SYNERGETICS as of the
Effective Date based upon the use, sale, offer for sale, importation, or other disposal of ALCON
Products at any time after the Effective Date. Patent infringement issues, if any, concerning
products introduced in the United States or elsewhere after the Effective Date shall be addressed
using the Future Dispute Resolution procedure set forth in Article VII below.



     3.3 License to SYNERGETICS. ALCON hereby grants to SYNERGETICS a nonexclusive, fully paid up,
global license, with no right to sublicense, under the Licensed ALCON Patents to make, have made,
use, sell, offer for sale and import SYNERGETICS Products. For clarity, the foregoing license is
strictly limited to SYNERGETICS and does not include a right for SYNERGETICS to manufacture
SYNERGETICS Products for Third Parties or sell SYNERGETICS Products to Third Parties other than its
distributors or end users of its products.



     3.4 License to ALCON. SYNERGETICS hereby grants to ALCON a semi-exclusive, fully paid up,
global license, with no right to sublicense, under the Licensed SYNERGETICS Patents, to have made
in accordance with the terms of the Supply Agreement, use, sell, offer for sale and import the
products described in the Supply Agreement that require this license (the “Licensed Product(s)”).
As used in this Section 3.4, the term “semi-exclusive” means that the Licensed SYNERGETICS Patents
hereafter shall not be licensed to any Third Party for any purpose. (ALCON




			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 8 of 24





 









 





acknowledges the
existence of a license to a portion of the Licensed SYNERGETICS Patents previously granted by
Synergetics to [redacted**].) The semi-exclusive license granted to ALCON hereunder
shall not, however, impair in any way the right of SYNERGETICS to make, use, sell, offer to sell or
import under the Licensed SYNERGETICS Patents. Except as expressly provided in Section
3.3 hereof, SYNERGETICS shall have no right to make, use, sell, offer for sale or import any
product incorporating ALCON proprietary technology [redacted**] for itself, [redacted**] or any
other Third Party. For further clarity, the license granted under this Section 3.4 is strictly
limited to ALCON and does not include a right for ALCON: i) to manufacture the Licensed Products
for itself, except that ALCON shall have such right under certain circumstances as provided by
Section 8.1 of the Supply Agreement; ii) to manufacture the Licensed Products for Third Parties; or
(iii) to sell such Licensed Products to Third Parties, except that ALCON shall have the right to
sell the Licensed Products to its distributors or customers including without limitation end users
of its products, so long as such Licensed Products are labeled and branded as ALCON products.




     3.5 No Patent Assignment. Nothing in this Agreement is intended to nor shall it constitute an
assignment of any ownership rights in the Licensed ALCON Patents to SYNERGETICS, or assignment of
any ownership rights in the Licensed SYNERGETICS Patents to ALCON. ALCON shall not have any right
to sue Third Parties for infringement of the Licensed SYNERGETICS Patents, except as provided below
in Section 3.6, Enforcement; nor shall SYNERGETICS have any right to sue Third Parties for
infringement of the Licensed ALCON Patents. The Parties understand and agree that they are not
required to record the licenses granted under Sections 3.3 or 3.4 in any public or





 




			
	**	 	This information has been omitted pursuant to a request for confidential treatment and has
been filed separately with the Securities and Exchange Commission.




			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 9 of 24






 









 










governmental
register in the United States or any foreign country, and shall not do so. The Parties similarly
understand that they are under no obligation to mark any products licensed under this Agreement
with the patent numbers of the licensing Party, except as required under the Supply Agreement.




     3.6 Enforcement. If at any time during the term hereof, ALCON learns of an unlicensed Third
Party sale of a vitreoretinal product reasonably believed to be within the scope of any of the
Licensed SYNERGETICS Patents, ALCON shall use reasonable efforts to promptly notify SYNERGETICS of
such Third Party sale. If SYNERGETICS does not agree that such product falls within the scope of
the Licensed SYNERGETICS Patents, the Parties agree to submit the matter to
binding arbitration pursuant to procedures and an arbitrator to be agreed upon by the Parties,
or in the absence of agreement, pursuant to an arbitrator appointed by, and the arbitration to be
conducted in accordance with the Expedited Procedures of the Commercial Dispute Resolution
Procedures of the American Arbitration Association in Houston, Texas, with the issue to be decided
within thirty (30) days after submission of the issue. Within the later of one hundred twenty
(120) days of receiving such notice from ALCON or an arbitration decision that the Third Party
product does fall within the scope of the Licensed SYNERGETICS Patents, SYNERGETICS shall take
action to stop the allegedly infringing Third Party sales. In the event that SYNERGETICS either
fails to initiate litigation within the one hundred twenty (120) day period or fails to secure a
court order or a binding agreement prohibiting the continued sale of the Third Party product within
a reasonable time, such failure, if uncured, shall permit ALCON, after notice to SYNERGETICS, to
initiate and control litigation to stop such Third Party sales, to which litigation SYNERGETICS
agrees to be joined and shall reasonably



			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 10 of 24






 









 





cooperate at ALCON’s expense. ALCON shall be allowed to
retain all monetary damages awarded from such litigation initiated by ALCON.




     IV. Consideration



     4.1 ALCON’s Payment. In consideration of the paid-up license granted to ALCON in Section 3.4
hereof, and adjusted for the value of the paid-up license granted to Synergetics in Section 3.3
hereof, ALCON shall pay SYNERGETICS thirty million dollars ($30,000,000.00) in United States
currency within five (5) business days of the Effective Date. Such payment shall be made by wire
transfer to the following account and in accordance with the following instructions:



[redacted**]




     4.2 Supply Agreement. The Parties agree to execute a supply agreement contemporaneous with
the execution of this Agreement, substantially in the form appended hereto as Exhibit C (“Supply
Agreement”).



     4.3 Other Consideration. ALCON and SYNERGETICS have granted the respective releases,
covenants and rights specified herein in consideration for reciprocal grants from the other Party.
The Parties acknowledge the sufficiency of the consideration exchanged under this Agreement and
nothing shall void or otherwise affect the finality of the releases hereunder.





 




			
	**	 	This information has been omitted pursuant
to a request for confidential treatment and has been filed separately with the
Securities and Exchange Commission.




			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 11 of 24





 









 










     V. Representations and Warranties



     5.1 SYNERGETICS Representations and Warranties. SYNERGETICS represents and warrants to ALCON
only that (a) it has all requisite legal right, power and authority to execute, deliver and perform
this Agreement and Exhibits; (b) it owns, or owns the exclusive right to assert, the Licensed
SYNERGETICS Patents, and that no Third Party owns any right to recover for infringement of the
Licensed SYNERGETICS Patents; (c) all named inventors of any of the Licensed SYNERGETICS Patents
have retained no rights (including without limitation rights to sue and rights of reversion) in
such patents that would permit them to make a claim against ALCON; and (d) it has not granted and
will not grant any licenses or other rights, under the Licensed SYNERGETICS patents or otherwise,
that would conflict with the licenses and rights granted to ALCON hereunder or prevent ALCON’s
exercise of these licenses and rights.



     5.2 ALCON Representations and Warranties. ALCON represents and warrants to SYNERGETICS only
that (a) it has all requisite legal right, power and authority to execute, deliver and perform this
Agreement and Exhibits; (b) it owns, or owns the exclusive right to assert, the Licensed ALCON
Patents, and that no Third Party owns any right to recover for infringement of the Licensed ALCON
Patents; (c) all named inventors of any of the Licensed ALCON Patents have retained no rights
(including without limitation rights to sue and rights of reversion) in such patents that would
permit them to make a claim against SYNERGETICS; and (d) ALCON has not granted and will not grant
any licenses or other rights, under the Licensed ALCON Patents or otherwise, that would conflict
with the licenses and rights granted to SYNERGETICS hereunder or prevent SYNERGETICS’s exercise of
these licenses and rights.


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 12 of 24





 









 





     5.3 Indemnification for Breach of Representations and Warranties. In the event of a material
breach of any of the representations and warranties under this Article V, the Party harmed by such
breach (“Indemnitee”) shall be indemnified and held harmless by the Party giving the
representations or warranties (“Indemnitor”) from and against all Third Party claims and related
costs,
attorneys’ fees and other expenses brought against or incurred by said harmed Party as a
consequence of such breach. If any Party becomes aware that it is in breach of Section 5.1 (b) or
(c) or Section 5.2 (b) or (c) that is not material to the licenses and other rights granted under
this Agreement, the Party making the representation or warranty causing said technical breach shall
promptly cure said breach. A Party that becomes aware of such a non-material breach by the other
shall give notice in accordance with Section 8.2 and a reasonable opportunity to cure before
initiating dispute resolution under Article VII of this Agreement. Any demand for indemnification
under this Section 5.3 shall be subject to the provisions of Article VII (Future Dispute
Resolution) of this Agreement. The Indemnitee shall only be entitled to such indemnification if:
(i) the Indemnitee has, at its own expense, promptly given the Indemnitor written notice of such
Third Party claim, such prompt notice not to exceed ninety (90) days after receipt of such a Third
Party claim or the date on which the Indemnitee knew or should have reasonably known that such
claim for indemnification under this section 5.3 existed; and (ii) the Indemnitor has been promptly
granted the right to take control of the settlement and defense of such claims with counsel
reasonably acceptable to the Indemnitee. The Indemnitee shall at all times reasonably cooperate in
the settlement and defense of such Third Party claims and shall make available all records,
materials and other relevant matter reasonably requested by the Indemnitor in connection with such
claims. No Party shall have the right to settle any Third Party claims in a manner that


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 13 of 24





 









 





materially
diminishes the rights or interests of the other without that other Party’s prior written consent,
which shall not be unreasonably withheld or delayed. The Indemnitor shall not be liable for any
settlement made without its prior written consent.




     5.4 Assurance of Cooperation to Implement Agreement. SYNERGETICS and ALCON each agree to
promptly execute and deliver at no additional cost to the other such additional releases,
agreements, instruments or other documents as may be reasonably necessary to give effect to this
Agreement and/or Exhibits.



VI. Term and Termination




     6.1 Term. If not earlier terminated pursuant to this Article 6, this Agreement shall remain
in effect until the expiration of the last to expire of the Licensed SYNERGETICS Patents issued in
the United States on or before the Effective Date, or such time as no Valid Claim of any Licensed
SYNERGETICS Patent issued in the United States covers the making, using or selling of the Licensed
Products, whichever first occurs.



     6.2 Termination. This Agreement and the rights and obligations specified herein may be
terminated at any time upon the mutual written agreement of the Parties.



     6.3 Bankruptcy. Any licenses or rights granted under or pursuant to this Agreement are, and
shall otherwise be deemed to be, for purposes of Section 365(n) of Title 11, US Code (the
“Bankruptcy Code”), licenses of rights to “intellectual property” as defined under Section 101(35A)
of the Bankruptcy Code. Any filings made by either Party under the Bankruptcy Code shall
constitute a Material Breach of this Agreement.


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 14 of 24





 









 





     6.4 Survival. The provisions of Articles II, III, V, Section 6.3 of Article VI, Article VII,
and Article VIII shall survive expiration or any termination of this Agreement.



VII. Future Dispute Resolution




     7.1. CEO Discussions. Before initiating any litigation against each other, the Parties shall
endeavor to amicably resolve any dispute arising out of this Agreement or any other dispute
pertaining to the respective businesses of the Parties. Before initiating any litigation, including
without limitation litigation arising out of or related in any way to this Agreement, to the
SYNERGETICS Patents or the ALCON Patents, to the SYNERGETICS Products or the ALCON Products, or
otherwise arising out of the business activities of the Parties, the Parties agree that the Chief
Executive Officer of the party that proposes to initiate litigation (the “Initiating Party”) shall
contact the Chief Executive Officer of the other party to attempt to resolve any dispute informally
without resort to litigation, contemporaneously with or before giving any written notice of the
existence of a dispute. The Chief Executive Officers may resolve the dispute themselves, or may
designate other representatives to discuss and attempt in
good faith to resolve the dispute. Each party shall work diligently to address the concerns
raised by the other, and in any event shall attempt to resolve the dispute within thirty (30) days
of being notified in writing of the existence of a dispute, or such other length of time as the
Parties may both agree upon in writing.



     7.2. Mediation. In the event that the Parties are not able to resolve their dispute pursuant
to and within the time provided by paragraph 7.1, above, the Parties agree that before initiating
any litigation against each other, the Parties shall submit any disputes to non-binding mediation
in Houston, Texas with a mutually acceptable mediator; provided, however, that the Parties’
obligations


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 15 of 24





 









 





to mediate shall not prejudice any Party’s right to seek injunctive relief from an
appropriate court following the mediation. After the expiration of the time period provided in
paragraph 7.1 above, the Parties shall have ten (10) business days to pick a mediator to hear the
dispute. If the Parties are unable within ten (10) business days to agree upon a mediator, the
Parties shall utilize a mediator selected by JAMS from among its panel of former jurists. The
Parties agree not to initiate any action before any court with respect to such dispute until the
earlier of the completion of the mediation or ninety (90) days after the party proposing to
initiate litigation has given written notice of the dispute to the other party. In the event that
mediation is unsuccessful, until the end of a period of sixty (60) days following completion of the
mediation or one hundred fifty (150) days following written notice of the dispute, whichever is
earlier, no party other than the Initiating Party may bring litigation to resolve the dispute. The
Initiating Party’s choice of forum for such litigation shall be subject to the rights of the other
party to challenge the forum for any reason contemplated by the applicable procedural rules and
case law.




     7.3. The Parties agree that nothing in this Agreement shall be construed as precluding a party
from seeking injunctive relief following completion of the mediation or otherwise altering the
legal standard for the imposition of such relief under the appropriate legal standards. The
Parties further agree that a Party’s participation in, or delays resulting from, the dispute
resolution procedures
described herein shall not be used either in support of or in opposition to any claim or
defense, whether equitable or at law, in any subsequent litigation.



     7.4. Nothing in this Article VII precludes any party from complying with any regulatory or
legal reporting requirement or otherwise making submissions to regulatory or administrative
agencies required by law that might affect the other Party, or objecting to regulatory or
administrative agency


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 16 of 24





 









 





decisions (e.g. patent opposition proceedings) that might involve any other
Party, provided that timely, advanced notice is provided to such other Party of such actions
related to proceedings in which such other Party is involved. In addition, nothing in this Article
VII shall prevent a Party from filing an action if such filing is reasonably believed to be
required to avoid a statute of limitations bar; provided, however, that such filing shall not
otherwise affect the obligation of the filing Party to comply with the provisions of this Article
VII, and the filing Party shall, if possible and to the extent legally permitted, delay formal
service of process on the other Party until completion of the associated dispute resolution process
of this Article VII.




     7.5 For clarity, the disputes referred to in this Article VII do not include matters covered
by Section 3.6



VIII. Miscellaneous Provisions




     8.1 Entire Agreement, Modification, Waiver. This Agreement and attached Exhibits and the
Supply Agreement constitute and contain the entire agreement between the Parties and supersede any
and all prior agreements, representations, negotiations, conversations, correspondence,
understanding, and letters, whether oral or written, of any kind or nature, respecting the subject
matter hereof. In entering into this Agreement, each Party acknowledges that it is not relying on
any representation, of any kind or manner, from the other Party other than those specifically set
forth in Article V (and for which the exclusive remedies are set forth in that Article). This
Agreement may be amended or modified or one or more provisions hereof waived, only by a written
instrument signed by the Parties. No failure or delay of either Party to require performance by
the other Party of any
provision of this Agreement shall in any way adversely affect such Party’s right to require
full


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 17 of 24





 









 





performance of the same or different provisions of this Agreement. No waiver by one Party of
a breach of any provision of this Agreement shall constitute a waiver by such Party of any
succeeding breach of the same or different provisions. The only licenses and rights granted under
this Agreement are those specifically and explicitly set forth herein, and no implied licenses are
granted hereunder.




     8.2 Notices. All notices required or permitted to be given hereunder shall be in writing and
shall be deemed delivered (i) upon receipt if delivered by hand, (ii) the next business day after
being sent by prepaid, nationally-recognized, overnight air courier, (iii) five (5) business days
after being sent by registered or certified airmail, return receipt required, postage prepaid, and
(iv) upon transmittal when transmitted by confirmed telecopy (provided that such notice is followed
by notice pursuant to any of (i) — (iii) above). All notices shall be addressed as follows:



     If to SYNERGETICS:




Chief Executive Officer

Synergetics USA, Inc.

3845 Corporate Centre Drive

O’Fallon, MO 63368




with a Copy to:




General Counsel

Synergetics USA, Inc.

3845 Corporate Centre Drive

O’Fallon, MO 63368


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 18 of 24





 









 





     If to ALCON:




Joanne Beck

General Manager

Alcon, Inc.

Bosch 69, P.O. Box 62

CH-6331 Hunenberg, Switzerland

Phone: 41 + 41 785 8858

Facsimile: 41 + 41 785 8889




with a copy to:




Elaine Whitbeck

Senior Vice President & General Counsel

Alcon Laboratories, Inc.

6201 South Freeway

Forth Worth, Texas 76134-2099

Phone: (817) 551-8693

Facsimile: (817) 568-7579



     8.3 Confidentiality. Neither this Agreement, nor any of its terms, shall be disclosed to any
person or entity without the prior written consent of all Parties, except that this Agreement and
its terms may be disclosed (i) to any insurer, reinsurer, attorney or auditor of the Parties after
such person or entity is first advised that the disclosure is subject to the confidentiality
provisions of this Agreement; (ii) to any of the Parties’ attorneys, accountants or tax preparers
after such person is first advised that the disclosure is subject to the confidentiality provisions
of this Agreement; and (iii) to any other person or entity if and to the extent required by any
law, court order, rule, regulation, or other public disclosure requirement (including exchange
requirements or the NASD’s requirements, as applicable), in the opinion of counsel for the
disclosing Party. Notwithstanding the above, the Parties have agreed to the form of the
SYNERGETICS press release attached hereto as Exhibit D, which may be released at any time after the
execution of this Agreement. ALCON shall not issue a press release


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 19 of 24





 









 





on the subject of this
Agreement or the Supply Agreement without the prior written consent of SYNERGETICS, which consent
shall not be unreasonably withheld. The Parties shall be entitled to use the information presented
in said press releases to respond to specific, direct inquiries from
shareholders, stock market analysts, customers or other Third Parties regarding this licensing
transaction between SYNERGETICS and ALCON. Both Parties shall utilize reasonable efforts to ensure
that the press releases and the information presented therein are not used for any other purposes,
including without limitation, promotional activities conducted by the respective marketing
personnel and/or sales forces of SYNERGETICS and ALCON.




     8.4 No Admissions By The Parties.



     a. This Agreement is the result of a compromised resolution of disputed claims between the
Parties. The Parties agree that this Agreement shall not be construed as an admission or concession
of liability, non-liability, responsibility or wrongdoing by any Party to this Agreement.



     b. The Parties further agree that this Agreement is not, and shall not be construed as,
reflective or adoptive of any particular position, claim construction or scope, analysis or
interpretation as to the facts or nature of any claim.



     c. All actions taken and statements made, whether orally or in writing, by the Parties, or by
their respective representatives, relating to this Agreement or participation in this Agreement,
including its development and implementation, shall not be used as evidence for any purpose in any
other disputed matter.



     8.5 No Construction Against Any Party. The wording of this Agreement was reviewed and
accepted by legal counsel for each Party before being signed by them, and no Party shall be


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 20 of 24





 









 





entitled based on the identity of the drafter to have any wording of this Agreement construed
against any other Party in the event of any dispute arising between them.




     8.6 No Assignment of Agreement. No Party hereto shall assign this Agreement without first
obtaining the written consent of the other Party hereto; provided, however, that consent shall not
be required for any assignment of this Agreement by a Party to a current or future Affiliate, nor
shall consent be required for assignment by a Party hereto as a consequence of merger, change of
control, sale or transfer of all or substantially all of the assets of its vitreoretinal surgical
business,
consolidation, or by operation of law. Notwithstanding the foregoing, any provisions of this
Agreement that are not yet fully performed at the time of the assignment shall extend to and be
binding upon the Parties hereto and their successors and assigns. Any attempted assignment of this
Agreement without such consent, except as provided herein, shall be void.



     8.7 Applicable Law. This Agreement shall be governed by and construed in accordance with the
laws of the United States and the laws of the State of Delaware without regard to principles of
conflicts of law. This provision is a choice of law provision only and not a choice of forum
provision. The Parties shall not assert in any future litigation that their choice of law makes
any forum more or less appropriate than any other forum.



     8.8 Counterparts. This Agreement may be signed in counterparts, each of which shall be deemed
an original, and a copy or facsimile of the fully-executed Agreement shall be as valid as the
original. This Agreement shall be amended only in writing by duly authorized officers of the
Parties, which amendment may also be signed in counterparts. No amendment is required to give
notice of a


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 21 of 24





 









 





change of address, contact information, or other modifications to the notification
provisions of Section 8.2; however, any such notice shall be given in accordance with the
provisions of Section 8.2.




     8.9 No Third-Party Beneficiaries. Nothing in this Agreement shall confer any rights or
remedies upon any individual person or Third Party. Nevertheless, this Agreement is binding upon
the Parties and their Affiliates.



     8.10 Headings. The headings and captions 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.



     8.11 Non-Agency. Nothing in this Agreement is intended or shall be deemed to constitute a
partnership, agency, employer-employee, or joint venture relationship between the Parties. No
Party shall incur any debts or make any commitments for the other. There is no fiduciary duty or
special relationship of any kind between the Parties to this Agreement. Each Party expressly
disclaims any reliance on any act, word, or deed of any other Party in entering into this
Agreement.



     8.12 Severability. If any provision or portion of a provision of this Agreement is held by a
court of competent jurisdiction to be invalid under any applicable statute or rule of law, such
court is authorized to modify such provision to the minimum extent necessary to make it valid, and
the remaining provisions or portions of provisions of this Agreement shall in no way be affected or
impaired thereby.



     8.13 Costs. Each Party shall bear its own costs, expenses and attorneys’ fees in connection
with the Litigation, the preparation of this Agreement, and performance hereunder. However, in
addition to other rights and remedies provided in this Agreement, in the event of litigation
between the Parties concerning the scope, enforcement or breach of this Agreement, if one Party
prevails in such


 
			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 22 of 24





 









 





litigation by obtaining a Rule 12(b)(6) dismissal, summary judgment, or judgment
as a matter of law of all or substantially all claims pleaded, then the prevailing Party shall be
entitled to recover, and the other Party shall pay, all costs and expenses (including without
limitation reasonable attorneys’ fees) incurred by the prevailing Party in such litigation.




SIGNATURE PAGE FOLLOWS




			
	  	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 23 of 24






 











 





     IN WITNESS WHEREOF, the Parties have caused their duly authorized officers to execute
this Agreement as of the dates below.



	 	 	 	 	 
	SYNERGETICS USA INC.

 	 	 
	By:  	/s/ Robert H. Dick
 	 	 
	 	Name:  	Robert H. Dick 	 	 
	 	Title:  	Chairman of the Board 	 	 
	 	Dated:   	this __ day of April, 2010 	 	 
	 
	ALCON, INC.

 	 	 
	By:  	/s/ Joanne Beck
 	 	 
	 	Name:  	Joanne Beck 	 	 
	 	Title:  	General Manager 	 	 
	 	Dated:  	this 22 day of April, 2010 	 	 
	 
	 	 	 
	By:  	                   /s/ Stefan Basler
 	 	 
	 	Name:  	Stefan Basler 	 	 
	 	Title:  	Attorney-in-Fact 	 	
	 	Dated:  	this 22 day of April, 2010 	 	 
	 
	 
	ALCON LABORATORIES, INC.

 	 	 
	By:  	/s/ Stewart Raetzman
 	 	 
	 	Name:  	Stewart Raetzman 	 	 
	 	Title:  	Area President US, and V.P. Global Marketing 	 	
	 	Dated:  	this 23 day of April, 2010 	 	 
	 
	 
	ALCON RESEARCH, LTD.

 	 	 
	By:  	/s/ Elaine E. Whitbeck           .
 	 	 
	 	Name:  	Elaine E. Whitbeck 	 	 
	 	Title:  	Senior VP, Chief Legal Officer, General Counsel and Corporate Secretary 	 	
	 	Dated:  	this 22 day of April, 2010 	 	 
	 




			
	 	 	 
	CONFIDENTIAL SETTLEMENT AND LICENSE AGREEMENT 

ALCON AND SYNERGETICS
	 	Page 24 of 24






 









 






Exhibit A




     Stipulated Dismissal (New York Litigation)



UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF NEW YORK




	 	 	 	 	 

	 

	:	 	 
	 

	:	 	 
	SYNERGETICS USA, INC.,

	:	 	 
	 

	:
	 	Case No. 08-CV-3669 (DLC)
	Plaintiff,

	:	 	 
	 

	:	 	 
	v.

	:
	 	STIPULATION OF VOLUNTARY
	 

	:
	 	DISMISSAL WITH PREJUDICE
	ALCON LABORATORIES, INC. and

	:
	 	PURSUANT TO FED. R. CIV. P. 41
	ALCON, INC.

	:	 	 
	 

	:	 	 
	Defendants.

	:	 	 
	 


	:	 	 






     Pursuant to Fed. R. Civ. P. 41(a)(1)(A)(ii), it is hereby stipulated by and between the
undersigned counsel for the parties that all claims in the above-captioned action shall be
dismissed with prejudice, with all parties to bear their own costs and attorneys’ fees.



STIPULATED AND AGREED




	 	 	 	 	 	 	 	 	 	 	 

	HANLY CONROY BIERSTEIN SHERIDAN
FISHER & HAYES LLP	 	 	 	MORGAN, LEWIS & BOCKIUS LLP	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Attorneys for Plaintiff	 	 	 	Attorneys for Defendants
 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	BY:

	 	 	 	 	 	BY:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Paul J. Hanly, Jr., Esquire
	 	 	 	 	 	J. Gordon Cooney, Jr., Esquire	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	SIMMONS COOPER LLC
 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	BY:
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	Derek Y. Brandt, Esquire	 	 	 	 	 	 	 	 






 









 






CERTIFICATE OF SERVICE




     I hereby certify that on this the __ day of April, 2010, the foregoing Stipulation of
Dismissal with Prejudice was served electronically upon:


Paul J. Hanly, Jr., Esquire

Andrea Bierstein, Esquire

HANLY CONROY BIERSTEIN SHERIDAN

FISHER & HAYES LLP

112 Madison Ave., 7th Floor

New York, New York 10016

Tel:   212.784.6401

Fax:   212.213.5949

phanly@hanlyconroy.com

abierstein@hanlyconroy.com


Derek Y. Brandt, Esquire

Emily J. Kirk, Esquire

SIMMONS COOPER LLC

707 Berkshire Boulevard

East Alton, Illinois 62024

Tel:   618.259.2222

Fax:   618.259.2251

dbrandt@simmonscooper.com

ekirk@simmonscooper.com


Counsel for Plaintiff



	 	 	 	 	 
	 	 	 
	 	                                   /s/ Heather Fuentes
 	 
	 	Heather Fuentes 	 
	 	 	 



 









 






	 	 	 	 	 



Exhibit B





     Stipulated Dismissal (Fort Worth Litigation)



IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS

FORT WORTH DIVISION




	 	 	 	 	 	 

	ALCON RESEARCH, LTD.

	 	)	 	 	 
	 

	 	)	 	 	 
	Plaintiff, and

	 	)	 	 	 
	Counterclaim-Defendant

	 	)	 	 	 
	 

	 	)	 	 	 
	ALCON LABORATORIES, INC., and

	 	)	 	 	 
	ALCON, INC.,

	 	)	 	 	CIVIL ACTION
	 

	 	)	 	 	No. 4:08-cv-00609-Y
	Plaintiffs,

	 	)	 	 	 
	v.

	 	)	 	 	 
	 

	 	)	 	 	 
	SYNERGETICS USA, INC., and

	 	)	 	 	JURY TRIAL DEMANDED
	SYNERGETICS, INC.,

	 	)	 	 	 
	 

	 	)	 	 	 
	Defendants and

	 	)	 	 	 
	Counterclaim-Plaintiffs.

	 	)	 	 	 






STIPULATION OF VOLUNTARY DISMISSAL WITH PREJUDICE




     Pursuant to Fed. R. Civ. P. 41(a)(1)(A)(ii), it is hereby stipulated by and between the
undersigned counsel for the parties that all claims in the above-captioned action shall be
dismissed with prejudice, with all parties to bear their own costs and attorneys’ fees.



 









 





STIPULATED AND AGREED TO:




	 	 	 

	Dated:             
                            

	 	                                                            
	 
	 	 
	 

	 	Alcon
	 
	 	 
	 

	 	By Counsel:
	 
	 	 
	 

	 	Hunton & Williams LLP
	 
	 	 
	 

	 	Stephen S. Maris
	 

	 	State Bar No. 12986400
	 

	 	Hunton & Williams LLP
	 

	 	1445 Ross Avenue, Suite 3700
	 

	 	Dallas, Texas 75202-2799
	 

	 	(T) (204) 979-3000
	 

	 	(F) (214) 880-0011
	 

	 	smaris@hunton.com
	 
	 	 
	 

	 	Brian M. Buroker (pro hac vice)
	 

	 	Hunton & Williams LLP
	 

	 	1900 K Street, N.W., Suite 1200
	 

	 	Washington, D.C. 20006
	 

	 	(T) (202) 955-1500
	 

	 	(F) (202) 778-2201
	 

	 	bburoker@hunton.com
	 
	 	 
	 

	 	ATTORNEYS FOR ALCON RESEARCH,
	 

	 	LTD., ALCON LABORATORIES, INC.,
	 

	 	AND ALCON, INC.






 









 






	 	 	 

	Dated:      
                                   

	 	                                                            
	 
	 	 
	 

	 	Synergetics
	 
	 	 
	 

	 	By Counsel:
	 
	 	 
	 

	 	John Booth
	 

	 	Peter V. Schroeder
	 

	 	David L. Joers
	 

	 	BOOTH ALBANESI SCHROEDER LLC
	 

	 	1601 Elm Street
	 

	 	Suite 1950
	 

	 	Dallas, TX 75201-4744
	 

	 	(T) (214) 220-0444
	 

	 	(F) (214) 220-0445
	 

	 	Email: jbooth@ipoftexas.com
	 

	 	pschroeder@ipoftexas.com
	 

	 	djoers@ipoftexas.com
	 
	 	 
	 

	 	Nicolas B. Clifford, Jr. (pro hac vice)
	 

	 	Michael H. Longmeyer (pro hac vice)
	 

	 	ARMSTRONG TEASDALE LLP
	 

	 	One Metropolitan Square, Suite 2600
	 

	 	(T) (314) 621-5070
	 

	 	(F) (314) 621-5065
	 

	 	E-mail: nclifford@armstrongteasdale.com
	 

	 	mlongmeyer@armstrongteasdale.com
	 
	 	 
	 

	 	ATTORNEYS FOR SYNERGETICS USA,
	 

	 	INC. AND SYNERGETICS, INC.






 









 






Exhibit C




Supply Agreement



[Filed as Exhibit 10.2 to the Form 10-Q for the period ended April 30, 2010]



 









 





Exhibit D




SYNERGETICS Press Release



Synergetics USA Enters Into A Settlement And License Agreement With Alcon






O’FALLON, MO, April     , 2010 — Synergetics USA, Inc., (NASDAQ: SURG) announced today the signing of
a pair of agreements with Alcon Laboratories, Inc. granting Alcon a license to sell certain
patented products manufactured by Synergetics for worldwide distribution on a co-exclusive basis
throughout the extensive Alcon network and covering the terms of supply of such products to Alcon
by Synergetics. The agreements also settle all litigation between Synergetics and Alcon.




As provided by the Settlement & License Agreement and Supply Agreement, Alcon will pay Synergetics
approximately $32 million for the right to sell certain Synergetics’ patented products worldwide
and to settle all pending litigation between the companies. These Agreements also provide for the
resolution of any future disputes through a well-defined mediation process.




“We are pleased to be able to to enter into a long term business relationship with Alcon, and
settle all litigation between the companies,” commented Robert Dick, Chairman of the Synergetics’
Board. Bob went on to say; “Synergetics welcomes the opportunity to work with Alcon to provide
ophthalmic surgeons throughout the world with select instruments to enhance their armamentarium in
the treatment of vitreo-retinal diseases.”




About Synergetics USA, Inc.




Standard language