Document:

EXHIBIT 10.10

 

[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

{Massachusetts General}

LICENSE AGREEMENT

 

THIS AGREEMENT, effective as of
November 7, 2003 (“EFFECTIVE DATE”) between THE GENERAL HOSPITAL CORPORATION, a not-for-profit
corporation doing business as Massachusetts General Hospital, having a place of
business at Fruit Street, Boston, Massachusetts 02114 (“GENERAL”)
and RELIANT TECHNOLOGIES, INC., a
corporation having offices at 5375 Mira Sorento Place, San Diego, CA 92121 (“COMPANY”).

 

RECITALS

 

WHEREAS, under research programs
funded by the GENERAL and the U.S. Government, the GENERAL through research
conducted by Drs. [ * ] has
developed an invention pertaining to the [ * ];

 

WHEREAS, GENERAL has filed a
U.S. Provisional Patent Application covering said invention and all Drs. [ * ] rights, title and interest in said application have
been assigned to GENERAL;

 

WHEREAS, as a center for patient
care, research and education, GENERAL, the owner of certain PATENT RIGHTS
(defined below), desires to grant a license to those PATENT RIGHTS in order to
benefit the public by disseminating the results of its research via the
commercial development, manufacture, distribution and use of products and
processes; and

 

WHEREAS, COMPANY has the
capacity to commercially develop, manufacture, use and distribute such products
and processes throughout the world;

 

NOW THEREFORE, in consideration
of the premises and of the faithful performance of the covenants herein
contained, the parties hereto agree as follows:

 

1.  DEFINITIONS

 

1.1          The term “AFFILIATE” with respect to either
party shall mean any corporation or other legal entity other than that PARTY in
whatever country organized, controlling, controlled by or under common control
with that PARTY. The term “control” shall mean (a) in the case of COMPANY,
direct or indirect ownership of at least fifty percent (50%) of the voting
securities having the right to elect directors and (b) in the case of GENERAL,
the power, direct or indirect, of management and policies, whether through the
ownership of voting securities, by contract or otherwise.

 

1.2          The term “COMMERCIAL SALE” shall mean (a) any
TRANSFER of a PRODUCT by COMPANY, an AFFILIATE or SUBLICENSEE (which may
include a transfer to an AFFILIATE or SUBLICENSEE), for value, cash or
otherwise; (b) any USE of a

 

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PROCESS by COMPANY, an AFFILIATE or SUBLICENSEE for
which COMPANY, an AFFILIATE or SUBLICENSEE receives value, cash or
otherwise.The term “LICENSE FIELD” shall mean [ * ].

 

1.3          The term “LICENSE TERRITORY” shall mean [ * ]. 

 

1.4          The term “NET SALES” shall mean

 

(a)           the gross amount
billed, invoiced or received by COMPANY, its AFFILIATES and SUBLICENSEES (for
the purposes of this section 1.5, each a SELLER) for TRANSFER of PRODUCTS and
PROCESSES to a final customer who will be the end user of PRODUCT or PROCESS,
less (to the extent appropriately documented) the following amounts actually
paid by COMPANY, its AFFILIATE or SUBLICENSEE or actually taken by the
customer:

 

(i)            credits and
allowances by reason of rejection or return;

 

(ii)           reasonable and
customary cash, quantity and trade discounts, rebates and cash discounts given
to and actually taken by third parties;

 

(iii)         amounts for outbound
transportation, insurance, handling or shipping to the extent separately
invoiced;

 

(iv)          taxes, customs
duties and other governmental charges levied on or measured by the COMMERCIAL
SALES, to the extent separately invoiced, whether paid by or on behalf of
COMPANY so long as COMPANY’s price is reduced thereby, but not franchise or
income taxes of any kind whatsoever;

 

(b)           No deductions shall
be made for commissions paid to individuals whether they be with independent
sales agencies or regularly employed by COMPANY or its AFFILIATES or
SUBLICENSEES and on their respective payrolls, or for any cost collections.

 

(c)           NET SALES shall
occur on the date of billing for a PRODUCT or PROCESS. For a PRODUCT or PROCESS
for which COMPANY, an AFFILIATE or SUBLICENSEES does not bill, NET SALES shall
occur on the date on which payment is due or made to the COMPANY, its AFFILIATE
or SUBLICENSEE, as applicable, whichever is earlier. If the date on which such
payment is due or made cannot be ascertained, [ * ].

 

(d)           If a SELLER
TRANSFERS or USES any PRODUCT or PROCESS at a discounted price that is lower
than the customary price charged by SELLER or for non-cash consideration
(whether or not at a discount), NET SALES shall be calculated based on the
non-discounted cash amount charged to an independent third party for the
PRODUCT or PROCESS during the same REPORTING PERIOD or, in the absence of such
transaction, on the fair market value of the PRODUCT or PROCESS.

 

(e)           Transfer of a
PRODUCT within COMPANY or between COMPANY and an AFFILIATE for sale by the
transferee shall not be considered a sale, commercial use or

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

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disposition for the purpose of the foregoing
paragraphs; in the case of such transfer the GROSS SALES PRICE shall be based
on sale of the PRODUCT by the transferee.

 

1.5          The term “PATENT RIGHT” shall mean the GENERAL’s
rights in U.S. Patent Application No. [ * ], entitled
[ * ], including any division, [ * ].

 

1.6          The term “PRODUCT” shall mean any article,
device, or composition, the manufacture, use, or sale of which, in whole or in
part, absent the licenses granted herein, would infringe or would reasonably be
considered to infringe one or more VALID CLAIM of any PATENT RIGHT. For
clarity, PRODUCT shall not include consumables such as topicals and sterile
disposables and carrying devices such as carts and cases.

 

1.7          The term “PROCESS” shall mean any process,
method or service which, in whole or in part absent the license granted
hereunder, would infringe or would reasonably be considered to infringe one or
more VALID CLAIMS of PATENT RIGHTS.

 

1.8          The term “REPORTING PERIOD” shall mean each
three month period ending March 31, June 30, September 30, and December 31.

 

1.9          The term “SUBLICENSEE” shall mean any third
party sublicensee of the rights granted by COMPANY under section 2.1 to make,
have made, use or sell any PRODUCT or PROCESS. As used in this Agreement, “SUBLICENSEE”
shall include any third party to whom COMPANY has granted, directly or
indirectly, the right to distribute a PRODUCT, provided that such third party
has the responsibility in whole or in part for marketing and/or promotion of
the PRODUCT within the territory for which such distribution rights are
granted.

 

1.10        The term “TRANSFER” shall mean to sell or have
sold, to lease or have  leased, to
import or have imported or otherwise to transfer or have transferred for cash
consideration or otherwise of a PRODUCT or PROCESS.

 

1.11        The term “USE” shall mean the performance or
other use of a PRODUCT or PROCESS.

 

1.12        The term “VALID CLAIM” shall mean [ * ].

 

2.  LICENSE

 

2.1          Grant of License.
Subject to the terms of this Agreement, GENERAL hereby grants COMPANY and its
AFFILIATES, to the extent not prohibited by the United States Government, in
the LICENSE FIELD in the LICENSE TERRITORY:

 

(a)           an exclusive,
royalty-bearing, transferable, to the extent permitted in Section 13.5, license
under GENERAL’s rights in PATENT RIGHTS to make, have made, USE and TRANSFER
PRODUCTS and to USE and TRANSFER PROCESSES;

 

(b)           the right to grant
sublicenses under the rights granted in Section 2.1(a) to SUBLICENSEES,
provided that in each case COMPANY shall be responsible for the performance of
any obligations of SUBLICENSEES relevant to this AGREEMENT as if such

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

3

 

performance were carried out by COMPANY itself [ * ].

 

The above licenses to sell PRODUCTS and PROCESSES
include the right to grant to the purchaser of products and processes from
COMPANY, its AFFILIATES, and SUBLICENSEES the right to use such purchased
PRODUCTS or PROCESSES in a method coming within the scope of PATENT RIGHT.

 

2.2          Sublicenses. Any and
all licenses granted hereunder shall be consistent with the terms of this
Agreement, shall incorporate terms and conditions sufficient to enable COMPANY
to comply with this Agreement and shall prohibit any further sublicense by a
SUBLICENSEE. Any sublicense granted by COMPANY shall be subject to the prior
written approval of GENERAL, which approval shall not be unreasonably withheld.
COMPANY shall provide to GENERAL a fully signed [ * ]
copy of all non-AFFILIATE sublicense agreements within thirty (30) days of
executing the same and shall provide GENERAL with a fully signed copy of any
AFFILIATE sublicense agreement within thirty (30) days of request by GENERAL.
Upon termination of this Agreement or any license granted hereunder for any
reason, any sublicenses shall be addressed in accordance with Section 10.6.

 

2.3          Retained Rights. Any
and all licenses granted hereunder are subject to:

 

(a)           GENERAL’s and
GENERAL’S AFFILIATES’ right to make and to use the subject matter described and
claimed in PATENT RIGHTS and to permit others at academic and/or not-for-profit
institutions to use the subject matter described and claimed in PATENT RIGHTS
for research and educational purposes; and

 

(b)           for PATENT RIGHTS
supported by federal funding, the rights, conditions and limitations imposed by
U.S. law (see 35 U.S.C. 202 et seq. and
regulations pertaining thereto), including without limitation:

 

(i)            the royalty-free
non-exclusive license granted to the U.S. government; and

 

(ii)           the requirement
that any PRODUCTS or PROCESSES used or sold in the United States shall be
manufactured substantially in the United States.

 

2.4          No Additional Rights.
It is understood that nothing herein shall be construed to grant COMPANY a
license express or implied under any patent owned solely or jointly by GENERAL
other than the PATENT RIGHTS expressly licensed hereunder. GENERAL shall have
the right to license any PATENT RIGHT to any other party for the purpose of
manufacturing, using or selling of any PRODUCT or PROCESS outside of the
LICENSE FIELD.

 

3.  DUE DILIGENCE OBLIGATIONS

 

3.1          Diligence Requirements.
COMPANY shall itself use or shall cause its AFFILIATES or SUBLICENSEES, as
applicable, to use, [ * ] efforts
to develop and make available to the public PRODUCTS and PROCESSES throughout
the LICENSE TERRITORY in the LICENSE FIELD. Such efforts shall include the
following objectives within the time

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

4

 

period designated below following the EFFECTIVE DATE:

 

(a)           within [ * ], apply for the first regulatory clearance necessary to
market a PRODUCT or PROCESS in the United States and in connection therewith
take all actions necessary under the Food, Drug and Cosmetic Act (21 USC
301-391);

 

(b)           within [ * ], make the first COMMERCIAL SALE of the PRODUCT or
PROCESS in the United States; and

 

(c)           COMPANY shall
itself or an AFFILIATE or SUBLICENSEE make such first COMMERCIAL SALE within
the following countries and regions in the LICENSE TERRITORY within the
following period of time after the EFFECTIVE DATE of this Agreement:

 

(i)            [ * ], on or
before [ * ]

 

(ii)           [ * ], on or before
[ * ]

 

(d)           following the first
COMMERCIAL SALE in any country in the LICENSE TERRITORY, COMPANY shall itself
or through its AFFILIATES and/or SUBLICENSEES make continuing COMMERCIAL SALES
in such country without any elapsed time period of [ * ]
or more in which such COMMERCIAL SALES do not occur.

 

Achievement of the
foregoing objectives shall be deemed to satisfy COMPANY’s obligations to use [ * ] efforts under this section 3.1.

 

3.2          Diligence Failures.
If GENERAL determines that COMPANY has failed to fulfill its obligations under
section 3.1, the GENERAL may treat such failure as a default and may terminate
this Agreement and/or the licenses granted hereunder in accordance with
Section 10.4.

 

3.3          Diligence Reports.
COMPANY shall provide all reports with respect to its obligations under Section
3.1 as set forth in Article 5.

 

4.  PAYMENTS
AND ROYALTIES

 

4.1          License Issue Fee.
COMPANY shall pay GENERAL a non-refundable, non-creditable license issue fee in
the sum of [ * ] Dollars ($[ * ]) upon execution of this Agreement.

 

4.2          Patent Cost
Reimbursement. COMPANY shall reimburse GENERAL for [ * ]
costs associated with the preparation, filing, prosecution and maintenance of
all PATENT RIGHTS, including but not limited to all costs incurred as part of
any action taken by GENERAL to resolve any potential interference action
between PATENT RIGHTS and COMPANY patent rights (“COSTS”),
whether such action is prior to or after an interference is declared by the
United States Patent and Trademark Office (“USPTO”). All COSTS shall be paid by COMPANY within thirty (30)
days of COMPANY’s receipt of an invoice for such COSTS either from GENERAL or
GENERAL’s patent counsel.

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

5

 

4.3          License Maintenance Fee.
COMPANY shall pay to GENERAL the following amounts in license maintenance fees
within sixty (60) days after the end of the REPORTING PERIOD in which each of
the following anniversaries of the EFFECTIVE DATE occurs:

 

(a)           For the period
between January 1, 2005 and December 31, 2005, and for a period between January
1, 2006 and December 31, 2006, an annual payment of [ * ]
Dollars ($    [ * ]);

 

(b)           For the period of [ * ] and [ * ], and [ * ] thereafter, an [ * ] payment
of      [ * ]
Dollars ($[ * ])

 

This license maintenance fee is non-refundable;
however the license maintenance fee shall be credited against royalties
subsequently due on NET SALES made during the same calendar year, if any.
License maintenance fees paid in excess of royalties due on NET SALES made in
such calendar year shall not be credited against royalties due on NET SALES
made in any other year.

 

4.4          Milestone Payments.
In addition to the payments set forth in Section 4.1 through 4.3 above, COMPANY
shall pay GENERAL a non-refundable, non-creditable milestone payment of [ * ] Dollars ($[ * ]) within
sixty (60) days of the first FDA clearance of a PRODUCT or PROCESS that is
commercialized or June 1, 2004, whichever shall occur earlier.

 

4.5          Royalties. 

 

(a)           Beginning with the
first COMMERCIAL SALE in any country in the LICENSE TERRITORY COMPANY and its
AFFILIATES shall pay GENERAL, during the term of any license granted under
Section 2 of this Agreement, a royalty of [ * ] of the
NET SALES of all PRODUCTS and PROCESSES hereunder.

 

(b)           If more than one
royalty rate is applicable to a PRODUCT or PROCESS, only the highest of the
applicable royalty rates shall apply.

 

(c)           All payments due to
GENERAL under this Section 4.5 shall be due and payable by COMPANY within sixty
(60) days after the end of each REPORTING PERIOD, and shall be accompanied by a
report as set forth in Section 5.

 

4.6          Sublicense Income.
COMPANY shall pay GENERAL within sixty (60) days  of
receipt thereof (a) [ * ] of any
and all royalty and non-royalty income including without limitation any payment
due COMPANY or an AFFILIATE in consideration for the sublicensing of any
license granted hereunder, whether in the form of up-front license fees,
license issue fees, maintenance fees, milestone payments or the fair market value
of any non-cash consideration; and (b) [ * ] of any
payment due to COMPANY for distribution rights or similar rights pertaining to
PRODUCTS or PROCESSES.

 

4.7          Form of Payment.
Checks for all payments due to the GENERAL under this Agreement shall be made
payable to GENERAL and addressed as set forth in Section 12.2. Each payment
shall reference this Agreement and identify the obligation under this Agreement
that the payment satisfies. All payments under this Agreement shall be drawn on
a United States bank

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

6

 

and shall be payable in United States dollars.
Conversion of foreign currency to U.S. dollars shall be made at the conversion
rate existing in the United States, as reported in the Wall Street Journal, on
the last working day of the applicable REPORTING PERIOD. Such payments shall be
without deductions of exchange, collection or other charges, and specifically
without deduction of withholding or similar taxes or other government imposed
fees or taxes except as permitted in the definition of NET SALES.

 

4.8          Overdue Payments.
The payments due under this Agreement shall, if overdue, bear interest
beginning on the first day following the REPORTING PERIOD to which such payment
was incurred and until payment thereof at a per annum rate equal to [ * ] above the prime rate in effect on the due date as
reported by the Wall Street Journal, such interest rate being compounded on the
last day of each REPORTING PERIOD, not to exceed the maximum permitted by law.
Any overdue payments when made shall be accompanied by all interest so accrued.
Said interest and the payment and acceptance thereof shall not preclude GENERAL
from exercising any other rights it may have as a consequence of the lateness
of any payment.

 

5.  REPORTS
AND RECORDS

 

5.1          Diligence Reports.
Within sixty (60) days after the end of each REPORTING PERIOD ending on June 30
and December 31 COMPANY shall report in writing to GENERAL on progress made
toward the objectives set forth in Section 3.1, including, without limitation,      [ * ].

 

5.2          Milestone Achievement
Notification. COMPANY shall report to GENERAL the dates on which it
achieves the milestone set forth in Section 4.4 within thirty (30) days of such
occurrence.

 

5.3          Sublicense Income
Reports. COMPANY shall, along with delivering payment as set forth in
Section 4.6, report to GENERAL within sixty (60) days of receipt the amount of
all non-royalty income received by COMPANY, and COMPANY’S calculation of the
amount due and paid to GENERAL from such income, including an itemized listing
of the source of income comprising such consideration, and the name and address
of each entity making such payments. COMPANY shall further provide sublicense
royalty income report as substantially provided for in section 5.4.

 

5.4          COMMERCIAL SALES Reports.
COMPANY shall report to GENERAL the date on which it achieves the first
COMMERCIAL SALE in each country of the LICENSE TERRITORY within thirty (30)
days of each such occurrence. Following the first COMMERCIAL SALE, COMPANY
shall deliver reports to GENERAL within sixty (60) days after the end of each
REPORTING PERIOD. Each report under this Section 5.4 shall have substantially
the format outlined in Appendix A, to be provided by General within thirty (30)
days of the Effective Date of this Agreement, shall be certified as correct by
an officer of COMPANY and shall contain at least the following information as
may be pertinent to a royalty accounting hereunder for the immediately
preceding REPORTING PERIOD:

 

(a)           (i)             [ * ];

 

(ii)           [ * ];

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

7

 

(b)           [ * ];

 

(c)           [ * ];

 

(d)           [ * ]; and

 

(e)           [ * ]. 

 

If no amounts are due to
GENERAL for any REPORTING PERIOD, the report shall so state.

 

5.5          Audit Rights.
COMPANY shall maintain, and shall cause each of its AFFILIATES and SUBLICENSEES
to maintain, complete and accurate records relating to the rights and
obligations under this Agreement and any amounts payable to GENERAL in relation
to this Agreement, which records shall contain sufficient information to permit
GENERAL and its representatives to confirm the accuracy of any payments and
reports delivered to GENERAL and compliance in all other respects with this
Agreement. COMPANY shall retain and make available, and shall cause each of its
AFFILIATES and SUBLICENSEES to retain and make available, such records for at
least [ * ] following the end of the calendar
year to which they pertain, to GENERAL and/or its representatives, at GENERAL’s
expense and upon at least fifteen (15) days’ advance written notice, for
inspection during normal business hours, to verify any reports and payments
made and/or compliance in other respects under this Agreement. If any
examination conducted by GENERAL or its representatives pursuant to the
provisions of this Section show an underreporting or underpayment of [ * ] or more in any payment due to GENERAL hereunder,
COMPANY shall bear the full cost of such audit and shall remit any amounts due
to GENERAL (including interest due in accordance with Section 4.8) within
thirty (30) days of receiving notice thereof from GENERAL.

 

6.  PATENT
PROSECUTION AND MAINTENANCE

 

6.1          Prosecution. GENERAL
shall be responsible for the preparation, filing, prosecution and maintenance
of all patent applications and patents included in PATENT RIGHTS. COMPANY shall
reimburse GENERAL for reasonable COSTS incurred by GENERAL relating thereto in
accordance with Section 4.2.

 

6.2          Copies of Documents.
With respect to any PATENT RIGHT, GENERAL shall instruct the patent counsel
prosecuting such PATENT RIGHT to promptly copy COMPANY on all patent
prosecution documents, and COMPANY shall have the opportunity to review and
comment upon such documents to GENERAL and GENERAL’s patent counsel.

 

6.3          Company’s Election Not
to Proceed. COMPANY may elect to surrender any patent or patent application
in Patent Rights in any country upon sixty (60) days written notice to GENERAL.
Such notice shall relieve COMPANY from the obligation to pay for future COSTS
but shall not relieve COMPANY from responsibility to pay COSTS incurred prior
to the expiration of the sixty (60) day notice period. Such U.S. or foreign
patent application or patent shall thereupon cease to be a PATENT RIGHT
hereunder, COMPANY shall have no further rights therein and shall immediately
cease the USE and TRANSFER of PRODUCTS and PROCESSES under such rights in such
country, and GENERAL shall be free to license its rights to that particular
U.S. or foreign patent application or patent to any other party on any terms.

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

8

 

6.4          Avoidance and Management
of Interference Actions. Upon execution of this Agreement the Parties
shall, with the aid of their respective counsel, in good faith, work
cooperatively to establish a patent prosecution strategy for the PATENT RIGHTS,
as such PATENT RIGHTS may relate to COMPANY patent rights, in order to identify
and resolve any potential interference action prior to such interference being
declared by the Patent and Trademark Office between PATENT RIGHTS and COMPANY
patent rights. In the event that such interference action cannot be avoided as
described herein above, and such interference is declared by the Patent and
Trademark Office between PATENT RIGHTS and COMPANY patent rights, the parties
shall work cooperatively, in good faith, to resolve such interference action as
expediently as reasonably possible. It is the parties intent to establish a
strong intellectual property position for PRODUCTS and PROCESSES through the
patent management efforts of both parties described herein.

 

7.  INFRINGEMENT

 

7.1          GENERAL Right to Prosecute.
GENERAL will protect its PATENT RIGHTS from infringement and prosecute
infringers when, in its sole judgment, such action may be reasonably necessary,
proper and justified. If COMPANY shall have [ * ]
infringement of a claim of a PATENT RIGHT by a third party which poses a
material threat to COMPANY’S rights under this Agreement, COMPANY may by notice
request GENERAL to take steps to protect the PATENT RIGHT. GENERAL shall notify
COMPANY within [ * ] of the receipt of such
notice whether GENERAL intends to prosecute the alleged infringement. If
GENERAL notifies COMPANY that it intends to so prosecute, GENERAL shall, within
[ * ] of its notice to COMPANY either
(i) cause such infringement to terminate, or (ii) initiate legal
proceedings against the infringer.

 

7.2          COMPANY Right to
Prosecute. In the event GENERAL notifies COMPANY that GENERAL does not
intend to prosecute said infringement COMPANY may, upon notice to GENERAL,
initiate legal proceedings against the infringer at COMPANY’s expense. Before commencing
such action, COMPANY and, as applicable, any AFFILIATE, shall consult with
GENERAL and shall give careful consideration to the views of GENERAL regarding
the advisability of the proposed action and its potential effects on the public
interest. COMPANY shall indemnify and hold GENERAL harmless from any costs,
expenses or liability that GENERAL incurs in connection with such action,
regardless of whether GENERAL is a party-plaintiff, except for the expense of
any independent counsel retained by GENERAL in accordance with Section 7.5
below.

 

7.3          Settlement. COMPANY
shall not enter into any settlement, consent judgment or other voluntary final
disposition of any infringement action without the prior written consent of
GENERAL.

 

7.4          Cooperation. Each PARTY
agrees to cooperate reasonably in any action under this Article 7 which is
controlled by the other PARTY, provided that the controlling party reimburses
the cooperating party for any costs and expenses incurred by the cooperating
party in connection with providing such assistance, except for the expense of
any independent counsel retained by GENERAL in accordance with this Section
7.5. Such controlling party shall keep the cooperating party informed of the
progress of such proceedings and shall make its counsel

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

9

 

available to the cooperating party. The cooperating
party shall also be entitled to independent counsel in such proceedings but at
its own expense, said expense to be offset against any damages received by the
PARTY bringing suit in accordance with Section 7.6.

 

7.5          Recovery. Any award
paid by third parties as the result of such proceedings (whether by way of
settlement or otherwise) shall first be applied to reimbursement of the unreimbursed
legal fees and expenses incurred by either PARTY and then the remainder shall
be divided between the PARTIES as follows:

 

(a)           (i)             if the amount is based on lost profits,
COMPANY shall receive an amount equal to [ * ]; and

 

(ii)           GENERAL shall
receive an amount equal to [ * ]; and

 

(b)           awards other than
those based on lost profits shall be [ * ].

 

8.  INDEMNIFICATION
AND INSURANCE 

 

8.1          Indemnification.

 

(a)           COMPANY shall
indemnify, defend and hold harmless GENERAL and its AFFILIATES and their
respective trustees, directors, officers, medical and professional staff,
employees, and agents and their respective successors, heirs and assigns (the “INDEMNITEES”), against any
liability, damage, loss or expense (including reasonable attorney’s fees and
expenses of litigation) incurred by or imposed upon the INDEMNITEES or any one
of them in connection with any claims, suits, actions, demands or judgments
arising out of any theory of product liability (including, but not limited to,
actions in the form of tort, warranty, or strict liability) concerning any
product, process or service made, used or sold pursuant to any right or license
granted under this AGREEMENT.

 

(b)           COMPANY agrees, at
its own expense, to provide attorneys reasonably acceptable to the GENERAL to
defend against any actions brought or filed against any party indemnified
hereunder with respect to the subject of indemnity contained herein, whether or
not such actions are rightfully brought; provided, however, that any INDEMNITEE
shall have the right to retain its own counsel, at the expense of COMPANY, if
representation of such INDEMNITEE by counsel retained by COMPANY would be
inappropriate because of actual or potential differences in the interests of
such INDEMNITEE and any other party represented by such counsel. COMPANY agrees
to keep GENERAL informed of the progress in the defense and disposition of such
claim and to consult with GENERAL prior to any proposed settlement

 

8.2          Insurance.

 

(a)           Beginning at such
time as any such product, process or service is being commercially distributed,
sold, leased or otherwise transferred, or performed or used (other than for the
purpose of obtaining regulatory approvals), by COMPANY, an AFFILIATE or
SUBLICENSEE, COMPANY shall, at its sole cost and expense, procure and maintain
commercial general liability insurance in amounts not less than $[ * ] per incident and $[ * ] annual
aggregate and naming the INDEMNITEES as additional insureds. Such commercial

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.

 

10

 

general liability insurance shall provide (i) product
liability coverage and (ii) broad form contractual liability coverage for
COMPANY’s indemnification under Section 8.1 of this AGREEMENT. If COMPANY
elects to self-insure all or part of the limits described above (including
deductibles or retentions which are in excess of $[ * ]
annual aggregate) such self-insurance program must be acceptable to the GENERAL
and the Risk Management Foundation. The minimum amounts of insurance coverage
required under this Section 8.2 shall not be construed to create a limit of
COMPANY’s liability with respect to its indemnification under Section 8.1 of
this AGREEMENT.

 

(b)           COMPANY shall
provide GENERAL with written evidence of such insurance upon request of
GENERAL. COMPANY shall provide GENERAL with written notice at least fifteen
(15) days prior to the cancellation, non-renewal or material change in such
insurance; if COMPANY does not obtain replacement insurance providing
comparable coverage prior to the expiration of such fifteen (15) day period,
GENERAL shall have the right to terminate this AGREEMENT effective at the end
of such fifteen (15) day period without notice or any additional waiting
periods.

 

(c)           COMPANY shall
maintain such commercial general liability insurance beyond the expiration or
termination of this AGREEMENT during (i) the period that any such product,
process, or service is being commercially distributed, sold, leased or
otherwise transferred, or performed or used (other than for the purpose of
obtaining regulatory approvals), by COMPANY or by a licensee, affiliate or
agent of COMPANY and (ii) a reasonable period after the period referred to in
(c) (i) above which in no event shall be less than fifteen (15) years.

 

9.  WARRANTIES
AND DISCLAIMER

 

9.1          [ * ].

 

9.2          Disclaimer. IN NO
EVENT SHALL GENERAL OR ANY OF ITS AFFILIATES OR THEIR RESPECTIVE TRUSTEES,
DIRECTORS, OFFICERS, MEDICAL AND PROFESSIONAL STAFF, EMPLOYEES AND AGENTS BE
LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ECONOMIC
DAMAGES OR INJURY TO PROPERTY AND LOST PROFITS, REGARDLESS OF WHETHER GENERAL
SHALL BE ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE
POSSIBILITY OF THE FOREGOING.

 

10.  TERM
AND TERMINATION

 

10.1        Term. The term of this
Agreement shall commence on the EFFECTIVE DATE and shall remain in effect until
the later of (a) the date on which all issued patents and filed patent
applications within the PATENT RIGHTS have expired or been abandoned, and (b)
one (1) year after the last COMMERCIAL SALE for which a royalty is due under
Section 4.5(a), unless this Agreement is terminated earlier in accordance with
the provisions of this Article 10.

 

10.2        Termination for Failure to
Pay. If COMPANY fails to make any payment due hereunder, GENERAL shall have
the right to terminate this Agreement upon ten (10) business days written
notice, unless COMPANY makes such payments plus any interest due, as set forth
in Section 4.8, within said ten (10) day notice period. If payments are not
made, GENERAL may

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

11

 

immediately terminate this Agreement at the end of
said ten (10) day period. [ * ]

 

10.3        Termination for Insurance
and Insolvency. GENERAL shall terminate this Agreement immediately upon
written notice with no further notice obligation or opportunity to cure if
COMPANY fails to maintain the insurance required by Section 8.2 or if COMPANY
shall become insolvent, shall make an assignment for the benefit of creditors,
or shall have a petition in bankruptcy filed for or against it.

 

10.4        Termination for
Non-financial Default. If COMPANY, its AFFILIATES or SUBLICENSEES shall
default in the performance of any of its obligations under this Agreement,
including but not limited to its obligations under Section 3.1, and if such
default has not been cured within sixty (60) days after notice by GENERAL in
writing of such default, GENERAL may immediately terminate any licenses granted
hereunder with respect to the country or countries in which such default has
occurred at the end of said sixty (60) day cure period GENERAL shall also have
the right to terminate such licenses immediately, upon written notice, in the
event of repeated defaults even if cured within such sixty (60) day periods.

 

10.5        Termination by Company.
COMPANY shall have the right to terminate this Agreement by giving ninety (90)
days advance written notice to GENERAL and shall immediately cease the USE and
TRANSFER of PRODUCTS and PROCESSES.

 

10.6        Effect of Termination on
Sublicenses. Any sublicenses granted by COMPANY under this AGREEMENT shall
provide for termination or assignment to GENERAL of COMPANY’s interest therein,
at the option of GENERAL, upon termination of this AGREEMENT or upon
termination of any license hereunder under which such sublicense has been
granted.

 

10.7        Effects of Termination of
Agreement. Upon termination of this AGREEMENT for any reason, final reports
in accordance with Article 5 shall be submitted to GENERAL and all royalties
and other payments, including without limitation any unreimbursed patent
expenses, accrued or due to GENERAL as of the termination date shall become
immediately payable, COMPANY shall cease, and shall cause its AFFILIATES and
SUBLICENSEES to cease under any sublicense granted by COMPANY, all TRANSFERS
and USES of PRODUCT(S) and PROCESSES upon such termination. The termination or
expiration of this Agreement or any licenses granted hereunder shall not
relieve COMPANY, its AFFILIATES or SUBLICENSEES of obligations arising before
such termination or expiration.

 

11.  COMPLIANCE
WITH LAW

 

11.1        Compliance. COMPANY
shall have the sole obligation for compliance with, and shall ensure that any
AFFILIATES and SUBLICENSEES comply with, all government statutes and
regulations that relate to PRODUCTS, including, but not limited to, FDA
statutes and regulations and the Export Administration Act of 1997, as amended,
and the regulations promulgated thereunder, and any applicable similar laws and
regulations of any other country in the LICENSE TERRITORY.

 

11.2        Patent Numbers. COMPANY
shall cause all PRODUCTS sold in the United States to be marked with all
applicable U.S. Patent Numbers, to the full extent required by

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

12

 

United States law. COMPANY shall similarly cause all
PRODUCTS shipped to or sold in any other country to be marked in such a manner
as to conform with the patent laws and practices of such country.

 

12.  DISPUTE
RESOLUTION

 

12.1        If a dispute arises
between the PARTIES relating to this Agreement or in the performance of this
Agreement (“Dispute”), within [ * ] of notice given about the Dispute, (a) representatives
of each PARTY with decision-making authority would in good faith negotiate to
resolve the dispute. (b) If the above action does not resolve the Dispute
within [ * ] of such meeting, then the PARTIES
would try in good faith to resolve the Dispute by mediation in accordance with
mutually acceptable mediation procedures. If the Dispute remains unresolved
after [ * ] of mediation, the PARTIES agree
to resolution of the Dispute by Alternative Dispute Resolution in accordance
with the procedure set forth in Exhibit B.

 

13.  MISCELLANEOUS

 

13.1        Entire Agreement. This
AGREEMENT constitutes the entire understanding between the PARTIES with respect
to the subject matter hereof.

 

13.2        Notices. Any written
notices, reports, waivers, correspondences or other communications required
under or pertaining to this AGREEMENT, and including all payments required
hereunder, shall be given by prepaid, first class, registered or certified mail
or by an express/overnight delivery service provided by a commercial carrier,
properly addressed to the other PARTY, which for GENERAL shall be as follows:

 

Director, Corporate Sponsored Research and Licensing 

Massachusetts General Hospital

Building 149, 13th Street, Suite 5036

Charlestown, MA 02129

 

Notices and payments
shall be considered timely if such notices are received on or before the
established deadline date or sent on or before the deadline date as verifiable
by legibly dated U.S. Postal Service postmark or dated receipt from a
commercial carrier.

 

13.3        Amendment; Waiver.
This Agreement may be amended and any of its terms or conditions may be waived
only by a written instrument executed by an authorized signatory of the PARTIES
or, in the case of a waiver, by the PARTY waiving compliance. The failure of
either PARTY at any time or times to require performance of any provision
hereof shall in no manner affect its rights at a later time to enforce the
same. No waiver by either PARTY of any condition or term shall be deemed as a
further or continuing waiver of such condition or term or of any other
condition or term.

 

13.4        Binding Effect. This
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the PARTIES hereto and their respective permitted successors and assigns.

 

13.5        Assignment. Except as
set forth in this Section 13.5, COMPANY shall not assign

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

13

 

any of its rights or obligations under this Agreement
without the prior written consent of GENERAL. Provided COMPANY has fulfilled
its diligence obligations as set forth in Article 3, no such consent will be
required to assign this Agreement to a successor of the COMPANY’s business to
which this Agreement pertains or to a purchaser of substantially all of the
COMPANY’s assets related to this Agreement, so long as such successor or
purchaser shall agree in writing to be bound by the terms and conditions hereof
prior to such assignment. COMPANY shall notify GENERAL in writing of any such
assignment within thirty (30) days thereof. Failure of such assignee to so
agree shall be grounds for termination of this Agreement for default.

 

13.6        Force Majeure. Neither
PARTY shall be responsible for delays resulting from causes beyond the
reasonable control of such party, including without limitation fire, explosion,
flood, war, sabotage, strike or riot, provided that the nonperforming party
uses commercially reasonable efforts to avoid or remove such causes of
nonperformance and continues performance under this Agreement with reasonable
dispatch whenever such causes are removed.

 

13.7        Use of Name. Neither
PARTY shall use the name of the other PARTY or of any trustee, director,
officer, staff member, employee, student or agent of the other PARTY or any
adaptation thereof in any advertising, promotional or sales literature,
publicity or in any document employed to obtain funds or financing without the
prior written approval of the PARTY or individual whose name is to be used. For
GENERAL, such approval shall be obtained from GENERAL’S Chief Public Affairs
Officer.

 

13.8        Governing Law. This
Agreement shall be governed by and construed and interpreted in accordance with
the laws of the Commonwealth of Massachusetts, except that questions affecting
the construction and effect of any patent shall be determined by the law of the
country in which the patent shall have been granted.

 

13.9        GENERAL Policies.
COMPANY acknowledges that GENERAL’s employees and medical and professional
staff members and the employees and staff members of GENERAL’s AFFILIATES are
subject to the applicable policies of GENERAL and such AFFILIATES, including,
without limitation, policies regarding conflicts of interest, intellectual
property and other matters. COMPANY shall provide GENERAL with any agreement it
proposes to enter into with any employee or staff member of GENERAL or any of
GENERAL’s AFFILIATES for GENERAL’s prior review and shall not enter into any
oral or written agreement with such employee or staff member which conflicts
with any such policy. GENERAL shall provide COMPANY, at COMPANY’s request, with
copies of any such policies applicable to any such employee or staff member.

 

13.10      Severability. If any
provision(s) of this AGREEMENT are or become invalid, are ruled illegal by any
court of competent jurisdiction or are deemed unenforceable under then current applicable
law from time to time in effect during the term hereof, it is the intention of
the parties that the remainder of this agreement shall not be effected thereby.
It is further the intention of the parties that in lieu of each such provision
which is invalid, illegal or unenforceable, there be substituted or added as
part of this AGREEMENT a provision which shall be as similar as possible in
economic and business objectives as intended by the parties to such invalid,
illegal or enforceable provision, but shall be valid, legal and enforceable.

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

14

 

13.11      Survival. Sections 5.5,
8.1, 8.2, 9.1, 9.2, 10.6, 10.7, 11.1, 11.2, 13.2, 13.7, 13.8, 13.9, 13.10, 13.11
and 13.12 shall survive termination or expiration of this Agreement.

 

13.12      Headings. All headings
are for convenience only and shall not affect the meaning of any provision of
this Agreement.

 

IN WITNESS WHEREOF, the PARTIES
have caused this AGREEMENT to be executed by their duly authorized
representatives as of the date first written above.

 

 

	
  COMPANY

  	
  GENERAL

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Maynard A. Howe, PhD.

  	
   

  	
  By:

  	
  /s/ Rebecca Menapace

  	
   

  
	
  Name: Maynard A. Howe

  	
  Name: Rebecca Menapace, MBA

  
	
   

  	
   

  
	
  Title:

  	
  CEO

  	
   

  	
  Title:

  	
  Associate Director

  	
   

  
	
   

  	
   

  
	
  Date:

  	
  11/10/03

  	
   

  	
  Date:

  	
  11/7/03

  	
   

  
									

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

15

 

Appendix A

 

To be provided by GENERAL
per Section 5.4 of the Agreement.

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

16

 

Appendix B

 

Alternative Dispute Resolution

 

The Parties recognize that bona fide disputes as to
certain matters may arise from time to time during the term of this Agreement
which relate to either Party’s rights and/or obligations. To have such a
dispute resolved by this Alternative Dispute Resolution (“ADR”)
provision, a Party first must send written notice of the dispute to the other
Party for attempted resolution by good faith negotiations between their
respective presidents (or their designees) of the affected subsidiaries,
divisions, or business units within [ * ] after
such notice is received (all references to “days”
in this ADR provision are to calendar days).

 

If the matter has not been resolved within [ * ] of the notice of dispute, or if the Parties fail to
meet within such [ * ], either Party may initiate
an ADR proceeding as provided herein. The Parties shall have the right to be
represented by counsel in such a proceeding.

 

1.             To begin an ADR
proceeding, a Party shall provide written notice to the other Party of the
issues to be resolved by ADR. Within [ * ] after its
receipt of such notice, the other Party may, by written notice to the Party
initiating the ADR, add additional issues to be resolved within the same ADR.

 

2.             Within [ * ] following receipt of the original ADR notice, the
Parties shall select a mutually acceptable neutral to preside in the resolution
of any disputes in this ADR proceeding. If the Parties are unable to agree on a
mutually acceptable neutral within such period, either Party may request the
President of the CPR Institute for Dispute Resolution (“CPR”),
366 Madison Avenue, 14th Floor, New York, New York 10017, to select a neutral
pursuant to the following procedures:

 

(a)           The CPR shall
submit to the Parties a list of not less than [ * ]
candidates within   [ * ]
after receipt of the request, along with a Curriculum Vitae for each candidate.
No candidate shall be an employee, director, or shareholder of either Party or
any of their subsidiaries or affiliates.

 

(b)           Such list shall
include a statement of disclosure by each candidate of any circumstances likely
to affect his or her impartiality.

 

(c)           Each Party shall
number the candidates in order of preference (with the number one (1)
signifying the greatest preference) and shall deliver the list to the CPR
within [ * ] following receipt of the list of
candidates. If a Party believes a conflict of interest exists regarding any of
the candidates, that Party shall provide a written explanation of the conflict
to the CPR along with its list showing its order of preference for the
candidates. Any Party failing to return a list of preferences on time shall be
deemed to have no order of preference.

 

(d)           If the Parties
collectively have identified fewer than [ * ]
candidates deemed to have conflicts, the CPR immediately shall designate as the
neutral the candidate for whom the Parties collectively have indicated the greatest
preference. If a tie should result between two candidates, the CPR may
designate either candidate. If the Parties collectively have identified

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

17

 

[ * ]
candidates deemed to have conflicts, the CPR shall review the explanations
regarding conflicts and, in its sole discretion, may either (i) immediately
designate as the neutral the candidate for whom the Parties collectively have
indicated the greatest preference, or (ii) issue a new list of not less
than [ * ] candidates, in which case the
procedures set forth in subparagraphs 2(a) - 2(d) shall be repeated.

 

3.             No earlier than [ * ] or later than [ * ] after
selection, the neutral shall hold a hearing to resolve each of the issues
identified by the Parties. The ADR proceeding shall take place at a location
agreed upon by the Parties. If the Parties cannot agree, the neutral shall
designate a location other than the principal place of business of either Party
or any of their subsidiaries or affiliates.

 

4.             At least [ * ] prior to the hearing, each Party shall submit the
following to the other Party and the neutral:

 

(a)           a copy of all
exhibits on which such Party intends to rely in any oral or written
presentation to the neutral;

 

(b)           a list of any
witnesses such Party intends to call at the hearing, and a short summary of the
anticipated testimony of each witness;

 

(c)           a proposed ruling
on each issue to be resolved, together with a request for a specific damage
award or other remedy for each issue. The proposed rulings and remedies shall
not contain any recitation of the facts or any legal arguments and shall not
exceed one (1) page per issue.

 

(d)           a brief in support
of such Party’s proposed rulings and remedies, provided that the brief shall
not exceed twenty (20) pages. This page limitation shall apply regardless of
the number of issues raised in the ADR proceeding.

 

Except as expressly set forth in subparagraphs 4(a) -
4(d), no discovery shall be required or permitted by any means, including
depositions, interrogatories, requests for admissions, or production of
documents.

 

5.             The hearing shall
be conducted on [ * ] and shall be governed by the
following rules:

 

(a)           Each Party shall be
entitled to [ * ] of hearing time to present
its case. The neutral shall determine whether each Party has had the [ * ] to which it is entitled.

 

(b)           Each Party shall be
entitled, but not required, to make an opening statement, to present regular
and rebuttal testimony, documents or other evidence, to cross-examine
witnesses, and to make a closing argument. Cross-examination of witnesses shall
occur immediately after their direct testimony, and cross-examination time
shall be charged against the Party conducting the cross-examination.

 

(c)           The Party
initiating the ADR shall begin the hearing and, if it chooses to snake an
opening statement, shall address not only issues it raised but also any issues
raised by the responding Party. The responding Party, if it chooses to make an
opening statement, also shall

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

18

 

address all issues raised
in the ADR. Thereafter, the presentation of regular and rebuttal testimony and
documents, other evidence, and closing arguments shall proceed in the same
sequence.

 

(d)           Except when
testifying, witnesses shall be excluded from the hearing until closing
arguments.

 

(e)           Settlement
negotiations, including any statements made therein, shall not be admissible
under any circumstances. Affidavits prepared for purposes of the ADR hearing
also shall not be admissible. As to all other matters, the neutral shall have
sole discretion regarding the admissibility of any evidence.

 

6.             Within [ * ] following completion of the hearing, each Party may
submit to the other Party and the neutral a post-hearing brief in support of
its proposed rulings and remedies, provided that such brief shall not contain
or discuss any new evidence and shall not exceed ten (10) pages. This page
limitation shall apply regardless of the number of issues raised in the ADR
proceeding.

 

7.             The neutral shall
rule on each disputed issue within [ * ] following
completion of the hearing. Such ruling shall adopt in its entirety the proposed
ruling and remedy of one of the Parties on each disputed issue but may adopt
one Party’s proposed rulings and remedies on some issues and the other Party’s
proposed rulings and remedies on other issues. The neutral shall not issue any
written opinion or otherwise explain the basis of the ruling.

 

8.             The neutral shall
be paid a reasonable fee plus expenses. These fees and expenses, along with the
reasonable legal fees and expenses of the prevailing Party (including all
expert witness fees and expenses), the fees and expenses of a court reporter,
and any expenses for a hearing room, shall be paid as follows:

 

(a)           If the neutral
rules in favor of one Party on [ * ] disputed
issues in the ADR, the losing Party shall pay [ * ]
of such fees and expenses.

 

(b)           If the neutral
rules in favor of one Party on some issues and the other Party on other issues,
the neutral shall issue with the rulings a written determination as to how such
fees and expenses shall be allocated between the Parties. The neutral shall
allocate fees and expenses in a way that bears a reasonable relationship to the
outcome of the ADR, with the Party prevailing on more issues, or on issues of
greater value or gravity, recovering a relatively larger share of its legal
fees and expenses.

 

9.             The rulings of
the neutral and the allocation of fees and expenses shall be binding,
non-reviewable, and non-appealable, and may be entered as a final judgment in
any court having jurisdiction.

 

10.          Except as provided
in paragraph 9 or as required by law, the existence of the dispute, any
settlement negotiations, the ADR hearing, any submissions (including exhibits,
testimony, proposed rulings, and briefs), and the rulings shall be deemed
Confidential Information. The neutral shall have the authority to impose
sanctions for unauthorized disclosure of Confidential Information.

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.

 

19

 

11.          All disputes
referred to ADR, the statute of limitations, and the remedies for any wrong
that may be found, shall be governed by the laws of the [ * ].

 

12.          The neutral may not
award punitive damages. The Parties hereby waive the right to punitive damages.

 

13.          The hearings shall
be conducted in the English language.

 

[ * ] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

 

20Exhibit 10.11

 

RELIANT TECHNOLOGIES, INC.

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT
(“Agreement”) is entered into as of October 4, 2006, by and between ERIC STANG (“Executive”) and RELIANT
TECHNOLOGIES, INC. (the “Company”), a Delaware corporation.

 

WHEREAS, the Company desires to
employ Executive to provide personal services to the Company, and wishes to
provide Executive with certain compensation and benefits in return for his
services;  and

 

WHEREAS, Executive wishes to be
employed by the Company and to provide personal services to the Company in
return for certain compensation and benefits.

 

NOW, THEREFORE, in consideration
of the mutual promises and covenants contained herein, it is hereby agreed by
and between the parties hereto as follows:

 

1.             EMPLOYMENT BY THE COMPANY.

 

1.1          Title and
Responsibilities. Subject to the terms set forth herein, the Company agrees
to employ Executive in the position of President and Chief Executive Officer,
and Executive hereby accepts such employment effective October 2, 2006 (the
“Effective Date”). During his employment with the Company, Executive will
report directly to the Board of Directors of the Company (the “Board”) in this
role, and shall devote his best efforts and all of his business time, skill and
attention (except for vacation periods and reasonable periods of illness or
other incapacity permitted by the Company’s general employment policies and
authorized activities pursuant to Section 5.1 of this Agreement) to the
business of the Company.

 

1.2          Executive Duties. Executive
will serve in an executive capacity and shall perform the duties of Executive’s
office as required by the Board and all such other duties reasonably assigned
to Executive by the Board from time to time.

 

1.3          Company Employment
Policies. Executive’s employment relationship with the Company shall be
governed by the general employment policies and procedures of the Company,
including those relating to the protection of confidential information and
assignment of inventions, except that when the terms of this Agreement conflict
with the Company’s general employment policies or procedures, this Agreement
shall control.

 

1.4          Board Service. On or
before the first regularly scheduled meeting of the Board after the Effective
Date, Executive shall be elected to serve as a director of the Board, and shall
serve on the Board consistent with the Company’s Certificate of Incorporation
(the “Certificate”) and Bylaws of the Company and applicable law. Executive
shall immediately tender his resignation from the Board upon (a) the
termination of his employment with the Company for any reason; or (b) at the
request of the Company immediately prior to or upon the occurrence of a Change
in Control (defined below). Executive may also be removed from the 

 

 

Board or have his term
terminate pursuant to the Certificate and Bylaws of the Company and applicable
law. Executive shall not receive any additional compensation for his service on
the Board beyond the compensation to be provided to him under this Agreement.

 

2.             COMPENSATION.

 

2.1          Base Salary. Executive
shall receive for services to be rendered hereunder a base salary at an
annualized rate of $350,000, payable on a semi-monthly basis in accordance with
the Company’s regular payroll dates, less required and designated payroll
withholdings and deductions (the “Base Salary”). Executive may be considered
for increases in Base Salary in accordance with Company policy and subject to
review and approval by the Board or the Compensation Committee of the Board
(the “Compensation Committee”).

 

2.2          Bonus Compensation.

 

(a)           Executive Bonus Plan. Effective
January 1, 2007, Executive shall be eligible to participate in the Company’s
Executive Bonus Plan, as amended from time to time (the “Bonus Plan”) on the
same terms as other corporate officers. Pursuant to the Bonus Plan, Executive
shall be eligible to earn an annualized Target Bonus equal to seventy-five
percent (75%) of Executive’s then-current Base Salary, based on achievement of
one hundred percent (100%) of the individual and Company performance objectives
and milestones established by the Board for that year in its sole discretion. All
bonus compensation shall be paid subject to applicable payroll withholdings and
employment taxes.

 

(b)           Guaranteed Bonus. For
his services during calendar year 2006, Executive shall receive a guaranteed
bonus (the “Guaranteed Bonus”) under the Bonus Plan equal to thirty-seven and a
half percent (37.5%) of Executive’s actual Base Salary earnings during the
fourth quarter of 2006 (i.e., the Guaranteed
Bonus shall equal fifty percent (50%) of Executive’s Target Bonus, prorated to
reflect his partial year service). The Guaranteed Bonus shall be paid at the
same time and on the same terms as other executive bonuses under the Bonus Plan.
Executive must remain employed with the Company through and including December
31, 2006 to receive the Guaranteed Bonus. Executive will also receive the other
fifty percent (50%) of his Target Bonus (i.e., an amount
equal to thirty-seven and a half percent (37.5%) of Executive’s actual Base
Salary earnings during the fourth quarter of 2006) if the Company achieves or
exceeds its performance objectives during the period. (As provided under the
Bonus Plan applicable for the 2006 calendar year, Executive may receive bonus
compensation above his Target Bonus (without a cap) if performance objectives
are exceeded.)

 

2.3          Equity. Executive
shall be granted two options (the “First Option” and the “Second Option”) to
purchase a total of 1,496,000 shares of Company Common Stock pursuant to the
terms and conditions of the Company’s 2003
Equity Incentive Plan, as may be amended from time to time (the “Stock
Plan”). Shares under both the First Option and the Second Option shall have a
per share exercise price equal to the fair market value of a share of Company
Common Stock as of the date of grant, as determined by the Board in its sole
discretion. The First Option and Second Option shall be subject to the terms
and conditions set forth in this Agreement, the Stock Plan and in stock option
grant notices and stock option agreements to be issued to Executive; provided,
however, that, except for the Company’s right of 

 

 

2

 

first refusal as set
forth in its Bylaws, the Company shall have no right to purchase or repurchase
any shares subject to the First Option or the Second Option which have vested
and been exercised by Executive. Except as otherwise specifically set forth
herein (including Section 3 of the Consulting Arrangement attached hereto as
Exhibit B), in the event of termination of Executive’s employment with the
Company for any reason, all stock options and other stock awards then held by
Executive shall cease vesting as of the date of such termination (the
“Termination Date”), and shall be exercisable after the Termination Date
pursuant to the terms of the applicable stock option agreements. Upon either
Executive’s termination of employment without Cause (defined below) at any
time, or Executive’s resignation for Good Reason (defined below) at any time
prior to or within twelve (12) months after a Change in Control, and subject to
Executive satisfying the release requirements set forth in Section 9 of this
Agreement, Executive shall have twelve (12) months following the Termination
Date (but not beyond the end of the applicable option term, if earlier) to
exercise any vested shares subject to the First Option, the Second Option (if
not previously expired) or any other stock options or equity awards then held
by Executive.

 

(a)           The First Option. The
First Option shall be an option to purchase 748,000 shares of Company Common
Stock, and shall be subject to a four (4) year vesting schedule, with
twenty-five percent (25%) of the shares subject to the First Option vesting
upon Executive’s completion of one (1) year of continuous employment, and
one-forty-eighth (1/48th) of the shares vesting in equal monthly
installments for each full month of Executive’s continuous employment
thereafter.

 

(b)           The Second Option. The
Second Option shall be an option to purchase 748,000 shares of Company Common
Stock, and shall be subject to the same vesting schedule as the First Option; provided, however, that if, the Company undergoes a Change
in Control or signs a binding term sheet or definitive agreement with respect
to a Change in Control within six (6) months after the Effective Date and
subsequently undergoes a Change of Control based on such signed binding term
sheet or agreement, the Second Option (and all shares subject to it) shall
automatically expire immediately prior to such Change in Control.

 

(c)           Other Equity Awards. Effective
upon the earlier of January 2008 or the date the Company completes an Initial
Public Offering of its common stock by registering it under the Securities Act
of 1933, as amended (“IPO”), Executive shall be eligible to receive additional
equity awards as determined by the Board or the Compensation Committee in its
sole discretion.

 

3.             BENEFITS.

 

3.1          General Benefits. Executive
shall be entitled to all rights and benefits for which he is eligible under the
terms and conditions of the standard Company benefits and compensation plans
which may be in effect from time to time and provided by the Company to its
employees and corporate officers generally, including but not limited to group
medical, dental and vision insurance plan participation and 401(k) plan
participation. Executive shall be reimbursed for all reasonable documented
business expenses incurred in connection with the performance of his job duties
in accordance with the Company’s expense reimbursement policies and procedures
in effect from time to time, including membership fees and other expenses 

 

3

 

related to Executive’s
participation in professional organizations (including the Young Presidents’
Organization) up to total maximum reimbursements of $5,000 per year. The
Company reserves the right to modify benefits from time to time, in its sole
discretion.

 

3.2          Paid Time Off. Executive
shall accrue paid time off (“PTO”) each year in an amount consistent with
Company policy plus an additional two (2) weeks of PTO per year, all of which
shall be accrued in equal amounts on a monthly basis, up to a maximum accrual
“cap” of thirty-five (35) days.

 

4.             CONFIDENTIAL
INFORMATION, RIGHTS AND DUTIES.

 

4.1          Confidential
Information. As a condition of employment, Executive must execute, deliver
and abide by the Company’s Employee Proprietary Information and Inventions
Agreement attached hereto as Exhibit A (the “Proprietary Information
Agreement”).

 

4.2          Exclusive Property. Executive
agrees that all Company-related business procured by the Executive, and all
Company-related business opportunities and plans made known to Executive, while
employed by the Company are and shall remain the permanent and exclusive
property of the Company.

 

5.             OUTSIDE
ACTIVITIES.

 

5.1          Activities. Except
with the prior written consent of the Board, Executive will not during his
employment with the Company undertake or engage in any other employment,
occupation or business enterprise, other than ones in which Executive is a
passive investor. Executive may engage in civic and not-for-profit activities
and may continue to serve as a Director of Miradia so long as such activities
do not materially interfere with the performance of his duties hereunder or
create an actual or threatened conflict of interest, as reasonably determined
by the Board in its sole discretion.

 

5.2          No Adverse Business
Activities. Throughout the term of Executive’s employment with the Company and
during any post-employment consulting arrangement entered into by the Company
and Executive pursuant to Section 7.3 of this Agreement (if applicable),
Executive agrees not to, directly or indirectly, without the prior written
consent of the Board, own, manage, operate, join, control, finance or
participate in the ownership, management, operation, control or financing of,
or be connected as an officer, director, executive, partner, employee,
principal, agent, representative, consultant, licensor, licensee or otherwise
with, any business or enterprise engaged in any business which is competitive
with or which is reasonably anticipated to be competitive with the business of
the Company (“Competitive Activity”). Notwithstanding the above, Executive will
not be deemed to be engaged directly or indirectly in any Competitive Activity
if Executive participates in any such business solely as a passive investor in
up to one percent (1%) of the equity securities of a company or partnership,
the securities of which are publicly traded. During Executive’s employment with
the Company, Executive agrees not to acquire, assume or participate in,
directly or indirectly, any position, investment or interest known to be
adverse or antagonistic to the Company, its business or prospects, financial or
otherwise.

 

6.             NONSOLICITATION. During
Executive’s employment with the Company and 

 

4

 

continuing for one (1) year after the Termination
Date, Executive shall not, without first obtaining the prior written approval
of the Company, directly or indirectly solicit, induce, persuade or entice, or
attempt to do so, or otherwise cause, or attempt to cause, any employee or
independent contractor of the Company to terminate his or her employment or
contracting relationship in order to become an employee or independent
contractor to or for any person or entity.

 

7.             TERMINATION
OF EMPLOYMENT/SEVERANCE BENEFITS.

 

7.1          At-Will Employment. Executive’s
relationship with the Company is at will. Accordingly, the Company shall have
the right to terminate Executive’s employment at any time, with or without
Cause, and with or without advance notice. Likewise, Executive shall have the
right to resign at any time, with or without Good Reason. The Company requests
that Executive provide at least thirty (30) days advance written notice of his
intent to resign without Good Reason.

 

7.2          Termination Date Payment.
Upon termination of Executive’s employment for any reason, the Company
shall pay Executive all accrued but unpaid Base Salary and bonus compensation,
and all accrued but unused PTO earned through the Termination Date, less
required and designated payroll withholdings and deductions. Executive shall
also be reimbursed for all business expenses incurred through and including the
Termination Date pursuant to the terms of Section 3.1 above, provided Executive
submits such expenses for reimbursement no later than thirty (30) days after
the Termination Date. Except as expressly provided herein, Executive shall not
be entitled to receive any other compensation or benefits from the Company
after the Termination Date, with the exception of any vested right Executive
has under the express terms of a written ERISA-qualified benefit plan (e.g., 401(k) account).

 

7.3          Termination Without
Cause/Resignation For Good Reason. Upon termination of Executive’s
employment without Cause at any time, or upon Executive’s resignation for Good
Reason at any time before or within twelve (12) months after a Change in
Control, Executive and the Company shall immediately commence a consulting
relationship on the terms set forth in Exhibit B hereto (the “Consulting
Arrangement”). No Consulting Arrangement will be deemed entered into if
Executive’s employment is terminated by the Company for Cause, Executive
resigns without Good Reason, or Executive resigns for Good Reason more than
twelve (12) months after the closing date of a Change in Control (the “CIC
Anniversary Date”).

 

7.4          Definitions.

 

(a)           Cause. For purposes
of this Agreement, “Cause” for termination of Executive’s employment means the
occurrence of any one or more of the following: 
(i) Executive’s commission of any crime involving fraud, dishonesty
or moral turpitude; (ii) Executive’s attempted commission of or
participation in a fraud or act of dishonesty against the Company that results
in (or might have reasonably resulted in) material harm to the business of the
Company; (iii) Executive’s intentional, material violation of any contract
or agreement between Executive and the Company or any statutory duty owed to
the Company; or (iv) conduct by Executive that constitutes gross
insubordination, gross incompetence or habitual neglect of 

 

5

 

duties and that results
in (or might have reasonably resulted in) material harm to the business of the
Company; provided, however, that the action or
conduct described in clauses (iii) and (iv) above will constitute “Cause” only
if such action or conduct continues after the Company has provided Executive
with written notice thereof and a period of thirty (30) days to cure the same,
provided such action or conduct is capable of cure. Termination of Executive’s
employment due to Executive’s death or disability shall not constitute Cause
for termination. The determination that a termination is for Cause shall be
made by the Board in good faith.

 

(b)           Good Reason. For
purposes of this Agreement, “Good Reason” for Executive to resign his
employment shall exist if one or more of the following actions are taken by the
Company without Executive’s consent:  (i)
the change in Executive’s reporting relationship to the Board and/or assignment
to Executive of duties or responsibilities that, taken as a whole, results in a
material diminution in Executive’s function as the Company’s President and
Chief Executive Officer, provided, however,
that a change in Executive’s reporting relationship or a reduction in his
duties or responsibilities resulting solely by virtue of a Change in Control
pursuant to which the Company is made part of a larger entity shall not
constitute Good Reason as long as (A) Executive is retained as the head of a
division or unit of the acquiring company following the Change in Control, and
(B) Executive does not suffer a material and adverse reduction in his duties
and responsibilities, taken as a whole, independent of those resulting directly
from the Change of Control (e.g., Executive
does not suffer a significant reduction in the number of direct reports
Executive had prior to the Change of Control, excluding the loss of direct
reports and supervisory authority resulting directly the conversion of the
Company to an division or unit of another entity (e.g.,
such as the loss of supervisory authority over accounting, human resources and
other administrative personnel customarily reporting in to other corporate
executives of the acquiring entity); (ii) a relocation of Executive’s business
office to a location more than twenty-five (25) miles from Mountain View,
California and such relocation results in a increase in Executive’s one-way
commuting distance from his home by twenty-five (25) miles or more, except for
required travel by Executive on Company business to an extent substantially
consistent with business travel obligations of President and Chief Executive
Officers of other companies that are similarly situated to the Company; or
(iii) a material breach by the Company of any provision of a material agreement
between Executive and the Company concerning the terms and conditions of
Executive’s employment (including a reduction in Base Salary, Target Bonus,
benefits (unless such reduction in Base Salary, Target Bonus or benefits is
applicable to all executives of the Company) or failure by a successor
corporation to assume and abide by the terms and conditions of this Agreement);
provided, however, that the action or
conduct described in clause (iii) above will constitute “Good Reason” only if
such action or conduct continues after Executive has provided the Board with
written notice thereof and fifteen (15) days to cure the same. Notwithstanding
the foregoing, Executive’s death or disability shall not constitute Good Reason
for resignation. Executive must resign within ninety (90) days after the date
the action which gives rise to Good Reason occurs in order to be deemed to have
resigned for Good Reason. The determination that a resignation is for Good
Reason shall be made by the Board in good faith.

 

6

 

8.             CHANGE
IN CONTROL.

 

8.1          Accelerated Vesting
Benefits.

 

(a)           Acceleration Upon a
Change in Control. Provided that Executive is employed by the Company as of
the effective date of a Change in Control (the “Change in Control Date”), on
such date, the final twelve (12) months of vesting of all stock options or other
equity awards then held by Executive (including the First Option and the Second
Option (if not previously expired in accordance with Section 2.3(b)) and any
subsequently granted stock options or equity awards) shall be accelerated such
that all said shares become vested as of the Change in Control Date.

 

(b)           Acceleration Upon
Completing 12-Months of Service Following a Change in Control. If Executive
remains actively employed in good standing with the Company for twelve (12)
months after the Change in Control Date, on the CIC Anniversary Date, the
second to last twelve (12) months of vesting of all stock options or other
equity awards granted by the Company and then held by Executive shall be
accelerated such that all said shares become vested as of the CIC Anniversary
Date.

 

(c)           Acceleration Upon a
Termination Without Cause or Resignation for Good Reason that Occurs One Month
Prior to Change in Control Date or on or Prior to The CIC Anniversary Date. If,
within one month prior to the Change in Control Date or following a Change in
Control but on or prior to the CIC Anniversary Date, Executive’s employment is
terminated by the Company without Cause or Executive resigns for Good Reason,
in addition to any benefits to which Executive may be entitled pursuant to
Sections 7.3 and 8.1 above (if applicable), Executive shall also be entitled to
receive accelerated vesting of all stock options and other equity awards
granted by the Company then held by him such that all shares subject to such
options become one hundred percent (100%) vested as of the Termination Date. Executive
shall not be entitled to any accelerated vesting benefits pursuant to this
Section 8.1(c) if the Termination Date is more than one month prior to the
Change in Control Date or after the CIC Anniversary Date.

 

8.2          Definitions.

 

(a)           Change in Control. For
purposes of this Agreement, a “Change in Control” means the first occurrence,
in a single transaction or in a series of related transactions, of any one or
more of the following events:

 

(i)            any Entity becomes
the owner, directly or indirectly, of securities of the Company representing
more than fifty percent (50%) of the combined voting power of the Company’s
then outstanding securities other than by virtue of a merger, consolidation or
similar transaction. Notwithstanding the foregoing, a Change in Control shall
not be deemed to occur (A) on account of the acquisition of securities of the
Company by any institutional investor, any affiliate thereof or any other
Entity that acquires the Company’s securities in a transaction or series of
related transactions that are primarily a private or public financing
transaction for the Company or (B) solely because the level of ownership held
by any Entity (the “Subject Person”) exceeds the designated percentage
threshold of the outstanding 

 

7

 

voting securities as a
result of a repurchase or other acquisition of voting securities by the Company
reducing the number of shares outstanding, provided that if a Change in Control
would occur (but for the operation of this sentence) as a result of the
acquisition of voting securities by the Company, and after such share
acquisition, the Subject Person becomes the owner of any additional voting
securities that, assuming the repurchase or other acquisition had not occurred,
increases the percentage of the then outstanding voting securities owned by the
Subject Person over the designated percentage threshold, then a Change in
Control shall be deemed to occur;

 

(ii)           there is
consummated a merger, consolidation or similar transaction involving (directly
or indirectly) the Company if, immediately after the consummation of such
merger, consolidation or similar transaction, the stockholders of the Company
immediately prior thereto do not own, directly or indirectly, either (A)
outstanding voting securities representing more than fifty percent (50%) of the
combined outstanding voting power of the surviving Entity in such merger,
consolidation or similar transaction or (B) more than fifty percent (50%) of
the combined outstanding voting power of the parent of the surviving Entity in
such merger, consolidation or similar transaction; or

 

(iii)         there is consummated
a sale, lease, license or other disposition of all or substantially all of the
consolidated assets of the Company and its subsidiaries, other than a sale,
lease, license or other disposition of all or substantially all of the
consolidated assets of the Company and its subsidiaries to an Entity, more than
fifty percent (50%) of the combined voting power of the voting securities of
which are owned by stockholders of the Company in substantially the same
proportion as their ownership of the Company immediately prior to such sale,
lease, license or other disposition.

 

(iv)          A Change in Control
shall not include a sale of assets, merger or other transaction effected
exclusively for the purpose of changing the domicile of the Company. For
avoidance of doubt, the parties understand and agree that the accelerated
vesting benefits provided herein shall be tied to the first Change in Control
transaction to occur after the Effective Date, and shall not be applicable to
subsequent Change in Control transactions.

 

(b)           Entity. For
purposes of this Agreement, an “Entity” means a corporation, partnership or
other entity, except that “Entity” shall not include (i) the Company or any
subsidiary of the Company, (ii) an underwriter temporarily holding securities
pursuant to an offering of such securities, or (iii) an Entity owned, directly
or indirectly, by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company.

 

9.             RELEASE REQUIREMENT. Executive
must sign and allow to become effective a general release of claims in
substantially the form attached hereto as Exhibit C (the “Release”) as a
precondition to receiving the extended exercise period available under Section
2.3 of this Agreement and accelerated vesting benefits available under Section
8 of this Agreement, and to entering into the Consulting Arrangement under
Section 7.3 of this Agreement. Executive must sign the Release no later than
thirty (30) days after the Termination Date to receive the benefits under
Sections 2.3, 7.3 and 8.1(c) of this Agreement; within thirty (30) days after the
Change in Control Date to receive any benefits under Section 8.1(a) of the
Agreement; and within thirty (30) days after the CIC Anniversary Date to
receive any benefits under Section 8.1(b) of the Agreement.

 

8

 

10.          LIMITATIONS
AND CONDITIONS ON PAYMENT OF BENEFITS.

 

10.1        Parachute Payments.

 

(a)           Best After-Tax. If
any payment or benefit (including payments and benefits pursuant to this
Agreement) Executive would receive in connection with a Change in Control from
the Company or otherwise (“Payment”) would (i) constitute a “parachute payment”
within the meaning of Section 280G of the Internal Revenue Code of 1986, as
amended (the “Code”), and (ii) but for this sentence, be subject to the excise
tax imposed by Section 4999 of the Code (the “Excise Tax”), then the Company
shall cause to be determined, before any amounts of the Payment are paid to
Executive, which of the following two alternative forms of payment would
maximize Executive’s after-tax proceeds: (i) payment in full of the entire
amount of the Payment (a “Full Payment”), or (ii) payment of only a part of the
Payment so that Executive receives the largest payment possible without the
imposition of the Excise Tax (a “Reduced Payment”), whichever amount results in
Executive’s receipt, on an after-tax basis, of the greater amount of the
Payment notwithstanding that all or some portion of the Payment may be subject
to the Excise Tax. For purposes of determining whether to make a Full Payment
or a Reduced Payment, the Company shall cause to be taken into account all
applicable federal, state and local income and employment taxes and the Excise
Tax (all computed at the highest applicable marginal rate, net of the maximum
reduction in federal income taxes which could be obtained from a deduction of
such state and local taxes). If a Reduced Payment is made, (i) the Payment
shall be paid only to the extent permitted under the Reduced Payment
alternative, and Executive shall have no rights to any additional payments
and/or benefits constituting the Payment, and (ii) reduction in payments and/or
benefits shall occur in the following order unless Executive elects in writing
a different order (provided, however,
that such election shall be subject to Company approval if made on or after the
date on which the event that triggers the Payment occurs): (1) reduction of
cash payments; (2) cancellation of accelerated vesting of equity awards other
than stock options; (3) cancellation of accelerated vesting of stock options; and
(4) reduction of other benefits paid to Executive. In the event that
acceleration of compensation from Executive’s equity awards is to be reduced,
such acceleration of vesting shall be canceled in the reverse order of the date
of grant unless Executive elects in writing a different order for cancellation.

 

(b)           The independent
registered public accounting firm engaged by the Company for general audit
purposes as of the day prior to the effective date of the Change in Control
shall make all determinations required to be made under this Section 10.1. If
the independent registered public accounting firm so engaged by the Company is
serving as accountant or auditor for the individual, entity or group effecting
the Change in Control, the Company shall appoint a nationally recognized
independent registered public accounting firm to make the determinations
required hereunder. The Company shall bear all expenses with respect to the
determinations by such independent registered public accounting firm required
to be made hereunder.

 

(c)           The independent
registered public accounting firm engaged to make the determinations hereunder
shall provide its calculations, together with detailed supporting
documentation, to the Company and Executive within fifteen (15) calendar days
after the date on which Executive’s right to a Payment is triggered (if
requested at that time by the 

 

9

 

Company or Executive) or
such other time as requested by the Company or Executive. If the independent
registered public accounting firm determines that no Excise Tax is payable with
respect to a Payment, either before or after the application of the Reduced
Amount, it shall furnish the Company and Executive with an opinion reasonably
acceptable to Executive that no Excise Tax will be imposed with respect to such
Payment. Any good faith determinations of the accounting firm made hereunder
shall be final, binding and conclusive upon the Company and Executive.

 

10.2        Application of Section
409A. In the event that the Company determines that any cash severance
payment benefit, accrued and unpaid bonus payment, or continued health, dental
and vision insurance coverage benefits provided under this Agreement fails to
satisfy the distribution requirement of Section 409A(a)(2)(A) of the Code as a
result of Section 409A(a)(2)(B)(i) of the Code, the payment of such benefit
shall be accelerated to the minimum extent necessary so that the benefit is not
subject to the provisions of Section 409A(a)(1) of the Code. (The payment
schedule as revised after the application of the preceding sentence shall be
referred to as the “Revised Payment Schedule.”) 
However, in the event the payment of benefits pursuant to the Revised
Payment Schedule would be subject to Section 409A(a)(1) of the Code, the
payment of such benefits shall not be paid pursuant to the Revised Payment
Schedule and instead the payment of such benefits shall be delayed to the
minimum extent necessary so that such benefits are not subject to the
provisions of Section 409A(a)(1) of the Code. The Board may otherwise modify
the timing of payments, the amounts paid, and make other modifications pursuant
to this Section 10.2 to preserve, as closely as possible, the economic
consequences that would have applied in the absence of this Section 10.2; provided, however, that no such modification shall result in
the payments being subject to Section 409A(a)(1) of the Code. Prior to any
actual payments under this Agreement to Executive, Executive and the Company
agree to work together in good faith to consider and implement amendments to
this Agreement which are necessary or appropriate to avoid imposition of any
additional tax or income recognition under Section 409A of the Code and any
temporary or final Treasury Regulations and Internal Revenue Service guidance
thereunder. The parties agree to cooperate with each other and to take
reasonably necessary steps in this regard.

 

11.          ARBITRATION. To
provide a mechanism for rapid and economical dispute resolution, Executive and
the Company agree that any and all disputes, claims, or causes of action, in
law or equity, arising from or relating to this Agreement (including all
exhibits hereto) or its enforcement, performance, breach, or interpretation, or
to Executive’s employment with the Company or the termination of Executive’s
employment with the Company, will be resolved, to the fullest extent permitted
by law, by final, binding, and confidential arbitration held in Santa Clara
County, California and conducted by a single arbitrator from the panel of
Judicial Arbitration & Mediation Services (“JAMS”), under its then-existing
rules and procedures governing the arbitration of employment-related disputes.
Executive understands and agrees that under this Section 11 of the Agreement, Executive
is waiving his right to a jury trial and his right to file any administrative
agency charge with regard to any such disputes, claims or causes of action,
including, but not limited to, all federal and state statutory and common law
claims, claims related to Executive’s employment with the Company or to the
termination of that employment, claims related to any breach of contract, tort,
wrongful termination, discrimination, wages or benefits, or claims for any form
of equity or compensation. Nothing in this Section 11 of this Agreement is
intended to prevent either the Executive or the Company from obtaining 

 

10

 

injunctive relief in court to prevent irreparable harm
pending the conclusion of any such arbitration.

 

12.          GENERAL
PROVISIONS.

 

12.1        Notices. Any notices
provided hereunder must be in writing and shall be deemed effective upon the
earlier of personal delivery (including, personal delivery by facsimile
transmission or email transmission), delivery by express delivery service (e.g. Federal Express), or the third day after mailing by
first class mail, to the Company at its primary office location and to
Executive at his address as listed on the Company payroll (which address may be
changed by written notice).

 

12.2        Severability. Whenever
possible, each provision of this Agreement will be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity, illegality or
unenforceability will not affect any other provision or any other jurisdiction,
but such invalid, illegal or unenforceable provision will be reformed, construed
and enforced in such jurisdiction so as to render it valid, legal, and
enforceable consistent with the intent of the parties insofar as possible.

 

12.3        Waiver. If either
party should waive any breach of any provisions of this Agreement, he or it shall
not thereby be deemed to have waived any preceding or succeeding breach of the
same or any other provision of this Agreement.

 

12.4        Entire Agreement. This
Agreement, together with the Proprietary Information Agreement and the other
exhibits hereto, constitutes the entire agreement between Executive and the
Company regarding the subject matter hereof and it supersedes and replaces any
prior agreement, promise, representation, written or otherwise, between
Executive and the Company (or any representative of the Company) with regard to
this subject matter. This Agreement is entered into without reliance on any
agreement, or promise, or representation, other than those expressly contained
or incorporated herein, and it cannot be modified or amended except in a
writing signed by Executive and a duly authorized member of the Board.

 

12.5        Counterparts. This
Agreement may be executed in separate counterparts, any one of which need not
contain signatures of more than one party, but all of which taken together will
constitute one and the same Agreement. Signatures transmitted via facsimile or
PDF shall be deemed the equivalent of originals.

 

12.6        Headings and Construction.
The headings of the sections hereof are inserted for convenience only and
shall not be deemed to constitute a part hereof or to affect the meaning
thereof. For purposes of construction of this Agreement, any ambiguities shall
not be construed against either party as the drafter.

 

12.7        Successors and Assigns. This
Agreement is intended to bind and inure to the benefit of and be enforceable by
Executive, the Company and their respective successors, assigns, heirs,
executors and administrators, except that Executive may not assign any of his
duties hereunder and he may not assign any of his rights hereunder without the
written consent of the Company.

 

11

 

12.8        Governing Law. All
questions concerning the construction, validity and interpretation of this
Agreement shall be governed by the law of the State of California as applied to
contracts made and to be performed entirely within California.

 

12.9        Exhibits.

 

Exhibit A – Proprietary Information Agreement

Exhibit B – Consulting Arrangement

Exhibit C –Release

 

IN WITNESS WHEREOF, the parties
have executed this Agreement effective as of the Effective Date above written.

 

	
  RELIANT TECHNOLOGIES, INC.

  
	
   

  
	
  /s/ Tom Scannell

  	
   

  
	
  Tom Scannell

  
	
  Chief Financial Officer

  
	
   

  
	
   

  
	
  ERIC STANG

  
	
   

  
	
  /s/ Eric Stang

  	
   

  

 

12

 

EXHIBIT A

 

EMPLOYEE PROPRIETARY INFORMATION
AND INVENTIONS AGREEMENT

 

A-1

 

EXHIBIT B

 

CONSULTING ARRANGEMENT

 

Set forth below are the terms and conditions of
Executive’s Consulting Arrangement with the Company following a termination
without Cause or a resignation for Good Reason.

 

1.             Consulting Period. Executive
shall serve as a consultant to the Company for twelve (12) months after the
Termination Date (the “Consulting Period”), unless Executive engages in any
Competitive Activity or violates any continuing obligation under his
Proprietary Information Agreement or Section 6 of the Agreement to which this
exhibit is attached, in which event the Consulting Arrangement shall
immediately terminate, and the Company shall have no continuing obligation to
pay any consulting fees or benefits, Executive shall have no further obligation
to provide any consulting services and Executive’s vesting of any stock options
shall immediately cease.

 

2.             Consulting Services. Executive
shall provide consulting services to the Company in any area of his expertise
upon request by the Company (the “Consulting Services”). Executive shall
provide the Consulting Services offsite at a location of his choosing, unless
his presence at a particular location is reasonably requested by the Company. Executive
shall make himself available to perform Consulting Services throughout the
Consulting Period, at reasonable times, for a maximum of twenty (20) hours per
month, provided that the Company shall not require Consulting Services to be
performed at a time or in a manner that would unreasonably interfere with
Executive’s ability to engage in any employment, consulting or work
relationship other than his consulting work for the Company (“Other Work
Activity”). As part of the Consulting Services, Executive shall, within the
first forty-five (45) days of the Consulting Period, provide the Company with a
report providing briefing information, as reasonably requested by the Company,
on Company operations and activities in which Executive had personal
involvement or about which he had personal knowledge and pending as of the
Termination Date.

 

3.             Consulting Fees,
Vesting and Benefits. The Company shall pay Executive total consulting fees
(the “Fees”), paid in equal semi-monthly installments over the 12-month
Consulting Period, totaling Executive’s annualized Base Salary as of the
Termination Date. In the event such Consulting Period commences following the
closing of an IPO, the Company shall also pay Executive fifty (50%) of
Executive’s Target Bonus as of the Termination Date, payable in quarterly
installments so long as Executive continues to provide Consulting Services to
the Company during the Consulting Period. Executive shall also continue to vest
any stock options or other equity awards (at the same rate in effect
immediately prior to the termination of Executive’s employment) so long as
Executive continues to provide Consulting Services to the Company during the
Consulting Period. In addition, provided the Executive timely elects to
continue his group health insurance benefits after the Termination Date
pursuant to the federal COBRA law or comparable state law and the terms and
conditions of the applicable Company group health insurance plans, the Company
shall also reimburse Executive for all health insurance continuation premiums
necessary to maintain Executive’s group health insurance coverage (for himself
and his covered dependents) as of the Termination Date in effect for 

 

B-1

 

Consulting Period or
until such earlier date as Executive is eligible for group health insurance
benefits through a subsequent employer. (Executive agrees to notify the Company
in writing no later than five (5) days after he becomes eligible for health
insurance benefits through a subsequent employer.)  Pursuant to its regular business practice,
the Company shall reimburse Executive for all reasonable documented business
expenses incurred in performing the Consulting Services.

 

4.             Taxes and Withholding.
The Company will not withhold from the Fees any amount for taxes, social
security or other payroll deductions, and will report the Fees on an IRS Form
1099. Executive acknowledges that he will be solely responsible for, and will
file, on a timely basis, all tax returns and payments required to be filed
with, or made to, any tax authority with respect to the performance of services
and receipt of Fees, and that Executive will defend, indemnify and hold
harmless the Company with respect to any liability for any taxes, penalties or
interest t assessed by any taxing authority with respect to the Fees or any
other amounts paid to him pursuant to this Consulting Arrangement.

 

5.             Ownership of Work
Product. Executive hereby assigns to the Company all right, title and
interest in and to any work product created by Executive, or to which Executive
contributes in performing the Consulting Services (the “Work Product”),
including all copyrights, trademarks and other intellectual property rights
contained therein. Executive agrees to execute, at the Company’s request and
expense, all documents and other instruments necessary or desirable to confirm
such assignment, including without limitation, a copyright assignment in the
form required by the Company (“Assignment of Copyright”). In the event that
Executive does not, for any reason, execute such documents within a reasonable
time after the Company’s request, Executive hereby irrevocably appoints the
Company as his attorney-in-fact for the purpose of executing such documents on
his behalf, which appointment is coupled with an interest.

 

6.             Artist’s and Moral
Rights. If Executive has any rights, including without limitation “artist’s
rights” or “moral rights,” in the Work Product that cannot be assigned, Executive
agrees to waive enforcement worldwide of such rights against the Company. In
the event that Executive has any such rights that cannot be assigned or waived,
Executive hereby grants to the Company an exclusive, royalty-free, worldwide,
irrevocable, perpetual license to use, reproduce, distribute, create derivative
works of, publicly perform and publicly display the Work Product in any medium
or format, whether now known or later developed.

 

7.             Representations and
Warranties. Executive represents and warrants that: (a) he has the right
and unrestricted ability to assign the Work Product to the Company as set forth
above, and (b) he will not create Work Product, which he knows or reasonably
should have known (without being required to make an independent investigation),
infringes upon any copyright, patent, trademark, right of publicity or privacy,
or any other proprietary right of any person, whether contractual, statutory or
common law. Executive agrees to indemnify the Company from any and all damages,
costs, claims, expenses or other liability (including reasonable attorneys’
fees) arising from or relating to the breach by Executive of the
representations and warranties set forth in this Section.

 

B-2

 

8.             Independent
Contractor Relationship. During the Consulting Period, Executive’s
relationship with the Company will be that of an independent contractor, and
nothing in the Consulting Arrangement is intended to, or should be construed
to, create a partnership, agency, joint venture or employment relationship. Executive
will not be entitled during the Consulting Period to any of the benefits that
the Company may make available to its Executives, including, but not limited
to, life insurance, profit-sharing or retirement benefits. Executive shall not
be authorized during the Consulting Period to make any representation, contract
or commitment on behalf of the Company unless specifically authorized in
writing to do so by the Company’s Chief Executive Officer or his or her
designee.

 

B-3

 

EXHIBIT C

 

RELEASE

 

In consideration for the [Consulting Arrangement]
[and] [Accelerated Vesting Benefits] to be provided to me pursuant to my
Executive Employment Agreement with Reliant Technologies, Inc. (the “Company”)
dated effective as of October 1, 2006 (the “Agreement”), I hereby release the
Company, its parents, subsidiaries, successors, predecessors and affiliates,
and each of such entities’ directors, officers, employees, shareholders,
agents, attorneys, insurers, affiliates and assigns, of and from any and all
claims, liabilities, demands, causes of action, costs, expenses, attorneys
fees, damages, indemnities and obligations of every kind and nature, in law,
equity, or otherwise, known and unknown, suspected and unsuspected, arising out
of or in any way related to agreements, events, acts or conduct at any time
prior to and including the date I sign this Release. This general release
includes, but is not limited to: (a) all claims arising out of or in any way
related to my employment with the Company, the termination of that employment
(if applicable), or my role or activities as a director of the Company or the
termination of that role (if applicable); (b) all claims related to my
compensation or benefits, including salary, bonuses, commissions, vacation pay,
expense reimbursements, severance pay, fringe benefits, stock, stock options,
or any other equity interests in the Company; (c) all claims for breach of
contract, wrongful termination, and breach of the implied covenant of good
faith and fair dealing; (d) all tort claims, including claims for fraud,
defamation, emotional distress, and discharge in violation of public policy;
and (e) all federal, state, and local statutory claims, including claims for
discrimination, harassment, retaliation, attorneys’ fees, or other claims
arising under the federal Civil Rights Act of 1964 (as amended), the federal
Americans with Disabilities Act of 1990 (as amended), the federal Age Discrimination
in Employment Act (as amended), the California Labor Code, and the California
Fair Employment and Housing Act (as amended). I represent that I have no
lawsuits, claims or actions pending in my name, or on behalf of any other
person or entity, against the Company or any other person or entity subject to
the release granted in this paragraph. Notwithstanding the foregoing, nothing
in this Release shall waive any rights of indemnification I may have pursuant
to the Articles and Bylaws of the Company or any written directors and officers
liability or other Company insurance policy in effect from time to time.

 

I acknowledge that I am also knowingly and voluntarily
waiving and releasing any rights that I have under the under the Age
Discrimination in Employment Act of 1967, as amended (the “ADEA”). I
acknowledge that the consideration given for this waiver and release is in
addition to anything of value to which I was already entitled. I further
acknowledge that I have been advised by this writing, as required by the ADEA,
that:  (a) my waiver and release do not
apply to any rights or claims that arise after the date I sign this Release;
(b) I have been advised hereby that I should consult with an attorney prior to
executing this Release; (c) I have twenty-one (21) days to consider this
Release (although I may choose voluntarily to sign it earlier); (d) I have
seven (7) days after the date I sign this Release to revoke my agreement to it
(by providing the Company with written notice of such revocation); and (e) my
acceptance of this Release will not be effective until the date upon which the
revocation period has expired, which will be the eighth day after I sign it
(provided I do not earlier revoke my acceptance of it).

 

C-1

 

I understand that this Release includes a release of
all unknown and unsuspected claims. I acknowledge that I have read and
understand Section 1542 of the California Civil Code, which states:  “A general release does
not extend to claims which the creditor does not know or suspect to exist in
his favor at the time of executing the release, which if known by him must have
materially affected his settlement with the debtor.”  I hereby waive all rights and benefits under
Section 1542 of the California Civil Code and any law or legal principle of
similar effect in any jurisdiction with regard to this Release, including my
release of unknown and unsuspected claims herein.

 

This Release, together with the Agreement (including
the exhibits thereto), constitutes the complete, final and exclusive embodiment
of the entire agreement between the Company and me with regard to the subject
matter hereof. I am not relying on any promise or representation that is not
expressly stated herein or in the Agreement.

 

UNDERSTOOD AND AGREED:

 

 

	
   

  	
   

  	
  Date:

  	
   

  
	
  Eric Stang

  

 

C-2

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