1037-00004 · Solstice Biomedical Devices Ltd · Settlement Documentation

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SETTLEMENT AGREEMENT AND MUTUAL RELEASE

EXECUTION VERSION

June 16, 2025

BETWEEN AND AMONG

SOLSTICE BIOMEDICAL DEVICES LTD. a private limited company organized under the laws of Ireland

SOLSTICE BIOMEDICAL, INC. a Delaware corporation

and

APEX SURGICAL INNOVATIONS, INC. a Delaware corporation

SETTLEMENT AGREEMENT AND MUTUAL RELEASE

This Settlement Agreement and Mutual Release (this "Agreement") is entered into as of June 16, 2025 (the "Effective Date"), by and among:

Solstice Biomedical Devices Ltd., a private limited company organized and existing under the laws of Ireland (CRO No. 648217), with its registered office at Unit 14, Clonskeagh Business Park, Clonskeagh Road, Dublin 14, D14 YF28, Ireland ("SBD" or "Solstice Parent");

Solstice Biomedical, Inc., a corporation organized and existing under the laws of the State of Delaware (EIN: 84-3291056), with its principal offices at 3800 Concord Pike, Suite 410, Wilmington, Delaware 19803 ("Solstice US," and together with Solstice Parent, "Solstice"); and

Apex Surgical Innovations, Inc., a corporation organized and existing under the laws of the State of Delaware (EIN: 51-0483762), with its principal office at 1220 North Market Street, Suite 550, Wilmington, Delaware 19801 ("Apex").

Solstice and Apex are each referred to herein individually as a "Party" and collectively as the "Parties."

RECITALS

A. Apex is the owner by assignment of all right, title, and interest in and to certain United States utility patents, including: (i) U.S. Patent No. 9,814,237 (the "'237 Patent"), entitled "Locking Seal Assembly for Minimally Invasive Surgical Access Device," issued on November 14, 2017 by the United States Patent and Trademark Office ("USPTO"), with an expiration date of June 22, 2035; (ii) U.S. Patent No. 10,271,884 (the "'884 Patent"), entitled "Retractable Blade Deployment Mechanism for Trocar Systems," issued on April 30, 2019, with an expiration date of September 15, 2036; and (iii) U.S. Patent No. 10,932,105 (the "'105 Patent"), entitled "Integrated Insufflation Valve and Seal for Laparoscopic Trocar," issued on March 2, 2021, with an expiration date of January 10, 2038. The '237 Patent, '884 Patent, and '105 Patent are collectively referred to herein as the "Asserted Patents." The named inventor on each of the Asserted Patents is Dr. Raymond Szabo, Vice President of Engineering at Apex. The Asserted Patents form part of a broader patent family comprising fourteen (14) issued United States patents and six (6) pending continuation applications (the "Apex Trocar Patent Family"), as more fully described in Exhibit C attached hereto.

B. Solstice Parent is an Irish-domiciled private limited company that designs, develops, manufactures, and distributes minimally invasive surgical instruments and related accessories. Solstice Parent was founded in 2011, reported fiscal year 2023 revenue of approximately €187.4 million, and employs approximately 620 persons worldwide. Solstice US is a wholly owned subsidiary of Solstice Parent and is responsible for the marketing, distribution, and sale of Solstice's products within the United States. Among its product lines, Solstice designs, manufactures, and sells laparoscopic trocar assemblies under the PrecisionEdge™ brand, including the PE-5000 Series (5 mm diameter), the PE-12000 Series (12 mm diameter), and the PE-15000 Series (15 mm diameter) (collectively, the "Accused Products").

C. On May 9, 2024, Apex filed a complaint for patent infringement against Solstice US in the United States District Court for the District of Delaware, captioned Apex Surgical Innovations, Inc. v. Solstice Biomedical, Inc., Case No. 1:24-cv-00587-RGA, assigned to Chief Judge Richard G. Andrews (the "Action" or "Litigation"). In the Action, Apex alleged that the Accused Products infringe one or more claims of the Asserted Patents, specifically: (i) the PE-5000 Series was alleged to infringe the '237 Patent and the '884 Patent; (ii) the PE-12000 Series was alleged to infringe all three Asserted Patents; and (iii) the PE-15000 Series was alleged to infringe the '884 Patent and the '105 Patent. Solstice US was served with the complaint on May 23, 2024, and on June 14, 2024 filed its Answer, Affirmative Defenses, and Counterclaims, asserting, among other things, non-infringement of each of the Asserted Patents, invalidity of the asserted claims under 35 U.S.C. §§ 102 and 103, inequitable conduct, and counterclaims for declaratory judgment of non-infringement and invalidity of the Asserted Patents. Thereafter, the Parties engaged in extensive fact and expert discovery, exchanged opening and rebuttal expert reports, and participated in a Markman hearing on November 18, 2024 before Chief Judge Andrews. The Court issued its Claim Construction Order on December 6, 2024. Cross-motions for summary judgment were fully briefed and argued, and were denied by Order dated May 5, 2025. The Action was scheduled for trial on September 30, 2025.

D. The Parties participated in a mediation session on March 17, 2025 before the Honorable Margaret Forsythe (Ret.) of Amberstone ADR Services in Wilmington, Delaware. That mediation did not result in a resolution of the dispute. The Parties subsequently participated in a second settlement conference on May 12, 2025 before Magistrate Judge Colleen Pratt. Following intensive arm's-length settlement negotiations conducted between May 19 and June 4, 2025, the Parties reached agreement in principle on the key terms of settlement and memorialized those terms in a Term Sheet executed by authorized representatives of the Parties on June 10, 2025 (the "Term Sheet").

E. The Parties now desire to fully and finally resolve all claims, counterclaims, defenses, and disputes between and among them arising out of or relating to the Action, the Asserted Patents, the Accused Products, and the Apex Trocar Patent Family, on the terms and conditions set forth in this Agreement. Solstice's outside litigation counsel in the Action is the firm of Calderwood & Harkness LLP (Marcus Delgado, Responsible Partner), 1201 Market Street, Suite 2500, Wilmington, Delaware 19801. Apex's outside litigation counsel in the Action is the firm of Hargrove, Tate & Bennington LLP (Victoria Stanton, Lead Partner), 900 North King Street, Suite 1200, Wilmington, Delaware 19801.

F. NOW, THEREFORE, in consideration of the mutual promises, covenants, releases, and other obligations set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each Party, the Parties agree as follows:

ARTICLE I — DEFINITIONS

Section 1.1 — Defined Terms. As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not defined in this Section 1.1 shall have the meanings assigned to them elsewhere in this Agreement.

"Accused Products" means the PrecisionEdge™ PE-5000 Series (5 mm), PE-12000 Series (12 mm), and PE-15000 Series (15 mm) laparoscopic trocar assemblies designed, manufactured, marketed, and sold by Solstice, as identified in the complaint and amended pleadings in the Action.

"Action" means the civil action captioned Apex Surgical Innovations, Inc. v. Solstice Biomedical, Inc., Case No. 1:24-cv-00587-RGA, pending in the United States District Court for the District of Delaware.

"Affiliate" means, with respect to a Party, any entity that directly or indirectly controls, is controlled by, or is under common control with such Party, where "control" means the direct or indirect ownership of more than fifty percent (50%) of the voting securities of, or equivalent ownership interest in, such entity.

"Agreed Joint Public Statement" means the joint public statement agreed upon by the Parties in the form attached hereto as Exhibit F.

"Apex Trocar Patent Family" means the fourteen (14) issued United States patents and six (6) pending continuation applications related to trocar and laparoscopic access device technology owned by Apex as listed on Exhibit C attached hereto, including the Asserted Patents.

"Asserted Patents" means, collectively, U.S. Patent No. 9,814,237, U.S. Patent No. 10,271,884, and U.S. Patent No. 10,932,105.

"Calendar Quarter" means each three-month period ending on March 31, June 30, September 30, and December 31 of each calendar year. For purposes of this Agreement, the first Calendar Quarter following the Effective Date shall include the period from the Effective Date through June 30, 2025, and the last Calendar Quarter shall include the period through the expiration of the last-to-expire Licensed Patent.

"Change of Control" means, with respect to Solstice Parent or Solstice US, as applicable, any of the following: (i) the acquisition by any third party (other than an Affiliate) of more than fifty percent (50%) of the outstanding voting securities of Solstice Parent or Solstice US; (ii) any merger, consolidation, or similar business combination transaction involving Solstice Parent or Solstice US following which the holders of the voting securities of the applicable Solstice entity immediately prior to such transaction do not retain majority control of the surviving or resulting entity; or (iii) the sale, transfer, exclusive license, or other disposition of all or substantially all of the assets of Solstice Parent or Solstice US.

"Confidential Information" means the terms and conditions of this Agreement (including all Exhibits hereto), the Escrow Agreement, the Term Sheet, the Side Letter, and all oral and written communications, proposals, draft agreements, negotiation correspondence, and other materials exchanged between or among the Parties and their respective counsel, agents, and representatives in connection with the settlement negotiations that gave rise to this Agreement, subject to the exceptions set forth in Section 9.1.

"Covenant Not to Sue" means the covenant set forth in Section 4.2 of this Agreement and more fully described in the document attached hereto as Exhibit B.

"Effective Date" means June 16, 2025, the date on which this Agreement has been fully executed by all Parties.

"Escrow Agent" means Tidewater Fiduciary Services, Inc., a Delaware corporation, with offices at 300 Delaware Avenue, Suite 1400, Wilmington, Delaware 19801.

"Escrow Agreement" means the escrow agreement of even date herewith entered into by and among Solstice, Apex, and the Escrow Agent, governing the deposit, holding, and release of the Lump-Sum Payment.

"Licensed Field" means laparoscopic surgical access devices, including laparoscopic trocars, trocar assemblies, and related components for use in minimally invasive surgical procedures.

"Licensed Patents" means the Asserted Patents and any continuations, divisionals, reissues, or reexamination certificates thereof.

"Licensed Products" means the PrecisionEdge™ PE-5000 Series, PE-12000 Series, and PE-15000 Series laparoscopic trocar assemblies, and any successor products thereto, but only to the extent such products fall within the scope of one or more claims of the Licensed Patents in the Licensed Field.

"Lower Rate License" has the meaning set forth in Section 5.1.

"Lump-Sum Payment" means the aggregate sum of Eight Million Seven Hundred Fifty Thousand United States Dollars ($8,750,000) payable by Solstice to Apex pursuant to Section 3.1.

"Net Sales" means the gross amounts invoiced by Solstice or any of its Affiliates or authorized sublicensees for sales of Licensed Products to unaffiliated third parties, less the following deductions to the extent actually incurred or accrued and separately identified on the applicable invoice or in Solstice's books and records maintained in accordance with U.S. generally accepted accounting principles ("GAAP") or International Financial Reporting Standards ("IFRS"), as applicable: (a) returns, credits, and allowances actually granted; (b) trade discounts, quantity discounts, rebates, and chargebacks actually allowed or paid; (c) freight, shipping, handling, and insurance charges included in the invoiced price; and (d) sales, use, value-added, excise, and similar governmental taxes and duties included in the invoiced price. Net Sales shall not include sales or transfers between or among Solstice and its Affiliates for resale, provided that Net Sales shall include the subsequent sale to an unaffiliated third party. In the event a Licensed Product is sold as part of a combination or bundled product together with other products or components that are not Licensed Products, Net Sales for purposes of calculating the Running Royalty shall be calculated by multiplying the gross amount invoiced for such combination product by a fraction, the numerator of which is the average standalone selling price of the Licensed Product component and the denominator of which is the average standalone selling price of all components of the combination product, each as determined from Solstice's price lists or, if no standalone prices exist, as reasonably determined by Solstice and subject to audit under Article VI.

"Patent License Agreement" means the Non-Exclusive Patent License Agreement in the form attached hereto as Exhibit A.

"Royalty Cap" means One Million Eight Hundred Thousand United States Dollars ($1,800,000) per calendar year, as more fully described in Section 3.2(b).

"Royalty Floor" means Five Hundred Thousand United States Dollars ($500,000) per calendar year, beginning with calendar year 2026, as more fully described in Section 3.2(a).

"Running Royalty" means the royalty of three and three-quarters percent (3.75%) of Net Sales of Licensed Products payable by Solstice to Apex pursuant to Section 3.2.

"Side Letter" means the side letter agreement of even date herewith between Solstice and Apex relating to the notification protocol for the most-favored licensee provision set forth in Article V.

"Stipulation of Dismissal" means the stipulation of dismissal with prejudice in substantially the form attached hereto as Exhibit E, to be filed in the Action.

"Term Sheet" means the binding term sheet executed by authorized representatives of the Parties on June 10, 2025, setting forth the principal terms of settlement, which term sheet is superseded in its entirety by this Agreement.

"Tranche 1" means Five Million Two Hundred Fifty Thousand United States Dollars ($5,250,000), as more fully described in Section 3.1(a).

"Tranche 2" means Three Million Five Hundred Thousand United States Dollars ($3,500,000), as more fully described in Section 3.1(b).

Section 1.2 — Rules of Construction. Unless the context otherwise requires: (a) the headings of Articles and Sections contained in this Agreement are for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement; (b) words importing the singular shall include the plural and vice versa, and words importing any gender shall include all genders; (c) the word "including" (and its grammatical variations) means "including, without limitation," and shall not be construed to limit any general statement that it follows to the specific or similar items or matters immediately following it; (d) references to "Sections," "Articles," and "Exhibits" are to Sections, Articles, and Exhibits of and to this Agreement unless the context otherwise requires; (e) references to any agreement, document, or instrument shall mean such agreement, document, or instrument as amended, supplemented, or modified from time to time in accordance with its terms and this Agreement; (f) references to any statute, rule, or regulation shall include all amendments thereto and all rules and regulations promulgated thereunder; and (g) references to "days" shall mean calendar days unless "business days" is expressly specified.

ARTICLE II — REPRESENTATIONS AND WARRANTIES

Section 2.1 — Mutual Representations and Warranties. Each Party hereby represents and warrants to each other Party, as of the Effective Date, as follows:

(a) Organization and Good Standing. Such Party is duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization: Solstice Parent under the laws of Ireland; Solstice US under the laws of the State of Delaware; and Apex under the laws of the State of Delaware. Each Party is duly qualified or licensed to do business in each jurisdiction in which the nature of its business or the ownership or leasing of its properties requires such qualification, except where the failure to be so qualified would not reasonably be expected to have a material adverse effect on such Party's ability to perform its obligations under this Agreement.

(b) Authority. Such Party has full corporate power and authority to enter into, execute, deliver, and perform its obligations under this Agreement and each of the ancillary documents contemplated hereby to which it is or will be a party.

(c) Due Authorization. The execution, delivery, and performance of this Agreement and the ancillary documents contemplated hereby have been duly authorized by all necessary corporate action on the part of such Party, including all requisite approvals of such Party's board of directors (or equivalent governing body). No additional corporate action on the part of such Party or its shareholders or members is necessary to authorize the execution, delivery, or performance of this Agreement.

(d) Enforceability. This Agreement constitutes a legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and other similar laws affecting creditors' rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith, and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity).

(e) No Consents Required. No consent, approval, order, or authorization of, or registration, declaration, or filing with, any governmental authority, regulatory body, or third party is required on the part of such Party in connection with the execution, delivery, and performance of this Agreement, except as expressly contemplated herein or as may be required in connection with the filing of the Stipulation of Dismissal or any required reports under applicable securities laws.

(f) No Conflicts. The execution, delivery, and performance by such Party of this Agreement and the ancillary documents contemplated hereby do not and will not (i) violate, conflict with, or result in a breach of any provision of such Party's certificate of incorporation, bylaws, memorandum of association, articles of association, or other organizational documents; (ii) violate, conflict with, or result in a breach or default (or an event that, with notice or lapse of time or both, would constitute a default) under any material agreement, contract, or instrument to which such Party is a party or by which such Party or its properties are bound; or (iii) violate any applicable law, statute, rule, regulation, order, judgment, decree, or injunction of any court or governmental authority applicable to such Party.

Section 2.2 — Apex's Representations and Warranties. Apex hereby additionally represents and warrants to Solstice, as of the Effective Date, as follows:

(a) Ownership of Asserted Patents. Apex is the sole and exclusive owner of the entire right, title, and interest in and to each of the Asserted Patents and each patent and patent application in the Apex Trocar Patent Family, free and clear of all liens, encumbrances, security interests, pledges, mortgages, charges, and adverse claims of any kind, other than non-exclusive licenses previously granted by Apex to third parties in the ordinary course of business prior to the Effective Date, none of which would materially impair Apex's ability to grant the license and covenant contemplated by this Agreement.

(b) Right to Grant License and Covenant. Apex has the full and unrestricted right and authority to grant the patent license and covenant not to sue contemplated by Article IV of this Agreement and the exhibits attached hereto without the consent, approval, or authorization of any third party, including without limitation any co-owner, co-inventor, licensee, or other person or entity having any interest in the Asserted Patents or the Apex Trocar Patent Family.

(c) Subsisting Patents. Each of the Asserted Patents is subsisting, has been duly issued by the USPTO, and has not been adjudicated invalid, unenforceable, or not infringed by any court, tribunal, or administrative body of competent jurisdiction in a final, non-appealable decision. All required maintenance fees for the Asserted Patents have been timely paid, and all necessary post-issuance filings have been duly made.

(d) No Pending Proceedings. To Apex's knowledge, as of the Effective Date, no reexamination, inter partes review, post-grant review, covered business method review, or any other proceeding before the USPTO or any other patent office or administrative body is pending with respect to any of the Asserted Patents.

(e) Inventor Assignment. Dr. Raymond Szabo, the named inventor on each of the Asserted Patents, has executed valid and binding assignments of all right, title, and interest in and to the Asserted Patents to Apex, and such assignments have been duly recorded with the USPTO. No other individual or entity has any claim to inventorship or ownership of any of the Asserted Patents.

Section 2.3 — Solstice's Representations and Warranties. Solstice hereby additionally represents and warrants to Apex, as of the Effective Date, as follows:

(a) Subsidiary Relationship. Solstice US is a direct, wholly owned subsidiary of Solstice Parent. All of the outstanding shares of capital stock of Solstice US are owned, beneficially and of record, by Solstice Parent, free and clear of all liens, encumbrances, and restrictions (other than restrictions on transfer imposed by applicable securities laws).

(b) Financial Capability. Solstice has the present financial capability and sufficient available resources to make all payments contemplated by this Agreement, including the Lump-Sum Payment and the Running Royalty payments, and does not know of any reason that would prevent or impair Solstice from making such payments when due.

(c) Books and Records. Solstice maintains true, accurate, and complete books and records of all sales, transfers, and other dispositions of Licensed Products, in conformity with GAAP or IFRS, as applicable, in sufficient detail to permit the accurate calculation of Net Sales and the Running Royalty. Solstice shall continue to maintain such books and records throughout the term of this Agreement and for a period of three (3) years following the expiration or termination of this Agreement.

ARTICLE III — PAYMENT TERMS

Section 3.1 — Lump-Sum Payment. In partial consideration for the releases granted in Article VII, the license granted in Article IV, and the covenant not to sue set forth in Section 4.2 and Exhibit B, Solstice shall pay to Apex an aggregate lump-sum settlement payment of Eight Million Seven Hundred Fifty Thousand United States Dollars ($8,750,000) (the "Lump-Sum Payment"), payable in two tranches as follows:

(a) Tranche 1. Within ten (10) business days following the Effective Date (and in no event later than June 30, 2025), Solstice shall pay to the Escrow Agent, by wire transfer of immediately available funds in accordance with the wire instructions set forth in the Escrow Agreement, the sum of Five Million Two Hundred Fifty Thousand United States Dollars ($5,250,000) ("Tranche 1"). Upon confirmation of the receipt of Tranche 1 into the escrow account maintained by the Escrow Agent, the Escrow Agent shall release the Tranche 1 funds to Apex by wire transfer to the bank account designated by Apex in the Escrow Agreement within three (3) business days of deposit. Solstice shall provide Apex with written confirmation of the wire transfer to the Escrow Agent promptly following its initiation.

(b) Tranche 2. On or before September 15, 2025, Solstice shall pay to the Escrow Agent, by wire transfer of immediately available funds in accordance with the wire instructions set forth in the Escrow Agreement, the sum of Three Million Five Hundred Thousand United States Dollars ($3,500,000) ("Tranche 2"). Upon confirmation of the receipt of Tranche 2 into the escrow account maintained by the Escrow Agent, the Escrow Agent shall release the Tranche 2 funds to Apex by wire transfer to the bank account designated by Apex in the Escrow Agreement within three (3) business days of deposit. Solstice shall provide Apex with written confirmation of the wire transfer to the Escrow Agent promptly following its initiation.

(c) Late Payment. Any portion of the Lump-Sum Payment or any Running Royalty payment not paid when due shall bear interest from the applicable due date until the date of actual payment at a rate equal to the lesser of (i) one and one-half percent (1.5%) per month (eighteen percent (18%) per annum) and (ii) the maximum rate of interest permitted by applicable law. The accrual of interest under this Section 3.1(c) shall not limit or waive any other rights or remedies available to Apex, including Apex's right to terminate the Patent License Agreement upon a material breach of payment obligations, as set forth in Section 10.2 of this Agreement. Any interest payable hereunder shall be computed on the basis of a 360-day year composed of twelve 30-day months.

Section 3.2 — Running Royalty. Beginning on the Effective Date and continuing for the remaining life of each Licensed Patent (with the last-to-expire Licensed Patent being the '105 Patent, expiring January 10, 2038), Solstice shall pay to Apex a running royalty equal to three and three-quarters percent (3.75%) of Net Sales of Licensed Products (the "Running Royalty"), subject to the Royalty Floor and Royalty Cap set forth below.

(a) Royalty Floor. Beginning with calendar year 2026, and for each full calendar year thereafter during the term of this Agreement, the minimum annual Running Royalty payable by Solstice to Apex shall be Five Hundred Thousand United States Dollars ($500,000) (the "Royalty Floor"). If the aggregate Running Royalty payments actually due and paid with respect to Net Sales for a given calendar year are less than the Royalty Floor, Solstice shall pay the difference between the actual aggregate Running Royalty and the Royalty Floor within thirty (30) days following the end of such calendar year. For the avoidance of doubt, the Royalty Floor shall not apply to the partial calendar year 2025 (i.e., the period from the Effective Date through December 31, 2025), nor to any partial calendar year at the end of the term resulting from the expiration of the last Licensed Patent. The Royalty Floor shall be prorated for any partial calendar year at the end of the term.

(b) Royalty Cap. The maximum aggregate Running Royalty payable by Solstice to Apex in any single calendar year shall not exceed One Million Eight Hundred Thousand United States Dollars ($1,800,000) (the "Royalty Cap"). Once cumulative Running Royalty payments for a given calendar year reach the Royalty Cap, no further Running Royalty shall be due or payable for the remainder of that calendar year. The Royalty Cap shall be prorated for any partial calendar year at the beginning or end of the term.

(c) Royalty Reporting. Solstice shall deliver to Apex a written quarterly royalty report, in substantially the form attached hereto as Exhibit D, within forty-five (45) days after the end of each Calendar Quarter. Each such royalty report shall include, at a minimum, the following information for the applicable Calendar Quarter, broken out by Licensed Product (PE-5000 Series, PE-12000 Series, and PE-15000 Series) and, within each Licensed Product, by geographic market (United States and international): (i) gross invoiced sales; (ii) itemized deductions for returns and allowances, trade discounts, rebates and chargebacks, freight and shipping charges, and applicable taxes; (iii) the resulting calculation of Net Sales; and (iv) the Running Royalty amount due for such Calendar Quarter. Each royalty report shall be certified as true, complete, and accurate by an authorized officer of Solstice, which certification shall be in the form set forth in Exhibit D.

(d) Royalty Payments. Running Royalty payments shall be due and payable within forty-five (45) days after the end of each Calendar Quarter, concurrently with the delivery of the corresponding royalty report. All Running Royalty payments shall be made by wire transfer of immediately available funds to a bank account designated by Apex in writing from time to time. Apex shall provide Solstice with its initial wire instructions within five (5) business days of the Effective Date and shall provide not less than fifteen (15) days' prior written notice of any change in wire instructions. All Running Royalty payments shall be made in United States Dollars. To the extent any Net Sales are invoiced in a currency other than United States Dollars, such amounts shall be converted to United States Dollars at the average daily exchange rate published by the European Central Bank for the applicable Calendar Quarter.

Section 3.3 — Tax Treatment. The Parties agree and acknowledge that the Lump-Sum Payment constitutes consideration for the settlement and release of all claims in the Action and for the grant of the Patent License Agreement and the Covenant Not to Sue, and that the Running Royalty constitutes license royalties for the use of intellectual property rights. Each Party shall be solely responsible for the payment of all taxes, duties, assessments, and other governmental charges imposed on it in connection with the payments made or received under this Agreement. Solstice shall comply with all applicable withholding tax obligations under United States federal, state, and local tax law and under the laws of Ireland, including any applicable provisions of the Convention between the Government of the United States of America and the Government of Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital Gains (the "U.S.-Ireland Tax Treaty"). Apex shall reasonably cooperate with Solstice's requests for tax documentation, including the execution and delivery of IRS Form W-9 or such other forms as may be reasonably required to establish Apex's tax status and to enable Solstice to comply with its withholding obligations. In the event that any withholding is required, Solstice shall remit the withheld amounts to the appropriate governmental authority, provide Apex with documentation of such withholding, and the net amount received by Apex after such withholding shall be deemed to satisfy Solstice's payment obligation with respect to the amount so withheld.

Section 3.4 — No Coverage by Insurance. The Parties acknowledge and agree that the Lump-Sum Payment, the Running Royalty, and all other payment obligations of Solstice under this Article III are not covered by, and Solstice does not expect to receive reimbursement from, any insurance policy maintained by Solstice or any of its Affiliates, including but not limited to intellectual property insurance Policy No. HSI-IP-2023-04891 issued by Halcyon Specialty Insurance Co. or any other insurance policy. Solstice's obligation to make all payments under this Article III is absolute and unconditional and shall not be contingent upon, reduced by, or subject to any right of set-off, counterclaim, or deduction related to insurance coverage, insurance reimbursement, or any dispute between Solstice and any insurer.

ARTICLE IV — LICENSE AND COVENANT NOT TO SUE

Section 4.1 — Patent License Grant. Subject to the terms and conditions of this Agreement and the Patent License Agreement attached hereto as Exhibit A, Apex hereby grants to Solstice a non-exclusive, non-transferable (except as expressly provided in Section 4.3), worldwide, royalty-bearing license under the Licensed Patents to make, have made, use, import, offer for sale, and sell Licensed Products in the Licensed Field. The license granted under this Section 4.1 shall be effective as of the Effective Date and shall remain in effect for the remaining life of each Licensed Patent, such that the license with respect to any individual Licensed Patent shall expire upon the expiration of that Licensed Patent (i.e., the license under the '237 Patent shall expire on June 22, 2035; the license under the '884 Patent shall expire on September 15, 2036; and the license under the '105 Patent shall expire on January 10, 2038). The license is royalty-bearing, with royalties payable as set forth in Section 3.2 of this Agreement.

Solstice shall have the right to grant sublicenses under the Licensed Patents solely to contract manufacturers engaged by Solstice for the manufacture of Licensed Products, provided that each such sublicense is set forth in a written agreement between Solstice and the sublicensee that contains terms and conditions no less protective of Apex's rights than those set forth in this Agreement and the Patent License Agreement, including without limitation obligations relating to confidentiality, record-keeping, and audit rights. Solstice shall provide Apex with written notice of any sublicense granted pursuant to this paragraph within thirty (30) days of its execution, together with a copy of the sublicense agreement (which may be redacted to remove pricing and other competitively sensitive information unrelated to Apex's rights). Solstice shall remain fully responsible for the acts and omissions of its sublicensees as if such acts and omissions were those of Solstice.

Section 4.2 — Covenant Not to Sue. As more fully set forth in the Covenant Not to Sue attached hereto as Exhibit B, Apex hereby irrevocably covenants and agrees that, during the term of the Patent License Agreement (as set forth in Section 4.1 and the Patent License Agreement), Apex will not assert, and will not authorize, direct, encourage, or assist any third party to assert, any patent or patent application in the Apex Trocar Patent Family (comprising the fourteen (14) issued United States patents and six (6) pending continuation applications listed on Exhibit C attached hereto) against Solstice, any Affiliate of Solstice, or any authorized sublicensee of Solstice, for or on account of the manufacture, having made, use, importation, offer for sale, or sale of any product within the Licensed Field. The Covenant Not to Sue extends to and encompasses all patents and patent applications in the Apex Trocar Patent Family, including any and all continuations, continuations-in-part, divisionals, reissues, and reexamination certificates thereof. The Covenant Not to Sue shall not extend to any patent or patent application outside the Apex Trocar Patent Family, and shall not limit Apex's right to assert patents against Solstice for activities outside the Licensed Field.

Section 4.3 — Transferability; Change of Control. The patent license granted in Section 4.1 and the Covenant Not to Sue granted in Section 4.2 are personal to Solstice and are non-transferable, except as expressly provided in this Section 4.3. In the event of a Change of Control of Solstice Parent or Solstice US, the patent license and Covenant Not to Sue shall automatically transfer to and be binding upon the successor entity, provided that such successor entity executes a written instrument reasonably satisfactory to Apex confirming the successor entity's agreement to be bound by all terms and conditions of this Agreement, including without limitation the payment obligations under Article III, the confidentiality obligations under Article IX, and the audit rights under Article VI. Solstice shall provide Apex with written notice of any Change of Control within thirty (30) days of the closing of the transaction giving rise to such Change of Control, which notice shall identify the successor entity and include a copy of the written instrument described in the preceding sentence. For the avoidance of doubt, the patent license and Covenant Not to Sue shall not extend to any products of the successor entity's pre-existing product lines that are not Licensed Products.

Section 4.4 — No Implied License. Except as expressly set forth in this Agreement, the Patent License Agreement, and the Covenant Not to Sue, nothing in this Agreement or in the performance or implementation hereof shall be construed to grant to Solstice, by implication, estoppel, or otherwise, any license or right under any patent, patent application, trade secret, trademark, copyright, or other intellectual property right owned, controlled, or licensable by Apex. Without limiting the foregoing, the license granted herein does not extend to any field of use other than the Licensed Field, and does not extend to any patent or intellectual property right other than the Licensed Patents and the Apex Trocar Patent Family as expressly provided herein.

ARTICLE V — MOST-FAVORED LICENSEE

Section 5.1 — Most-Favored Licensee Obligation. If, at any time during the term of this Agreement following the Effective Date, Apex enters into a license agreement or other arrangement with any third party with respect to any one or more of the Licensed Patents that provides for a running royalty rate (whether expressed as a percentage of net sales or an equivalent per-unit royalty) that is lower than three and three-quarters percent (3.75%) of Net Sales (any such agreement, a "Lower Rate License"), Apex shall provide written notice to Solstice of such Lower Rate License within thirty (30) days of the execution thereof. Upon delivery of such notice, the Running Royalty rate applicable to Solstice under Section 3.2 of this Agreement shall automatically adjust downward to the lower running royalty rate set forth in the Lower Rate License, effective prospectively as of the first day of the Calendar Quarter following Apex's delivery of such notice to Solstice. For the avoidance of doubt, the most-favored licensee adjustment shall apply only to reductions in the running royalty rate and shall not require any retroactive adjustment or refund of royalties previously paid by Solstice at the 3.75% rate.

Section 5.2 — Notification Protocol. The notification obligations set forth in this Article V are further described in the Side Letter of even date herewith between Solstice and Apex. Apex's notification under Section 5.1 shall include a written notice specifying: (i) the effective date of the Lower Rate License; and (ii) the applicable running royalty rate under the Lower Rate License. Apex shall not be required to disclose the identity of the third-party licensee under the Lower Rate License, unless such disclosure is required by applicable law, regulation, or court order. Upon Solstice's reasonable request, Apex shall provide to Solstice a certification from Apex's outside independent auditors (currently Creston Perry LLP, Certified Public Accountants, Wilmington, Delaware) or from Apex's outside legal counsel, confirming: (a) that a Lower Rate License has been executed; (b) the effective date of such Lower Rate License; and (c) the applicable running royalty rate thereunder. The cost of any such certification shall be borne by Solstice.

Section 5.3 — Disputes. Any dispute arising under or relating to this Article V, including any dispute regarding the applicability of the most-favored licensee adjustment, the comparability of royalty structures, or the calculation of the adjusted royalty rate, shall be resolved in accordance with the dispute resolution procedures set forth in Article XII of this Agreement.

ARTICLE VI — AUDIT RIGHTS

Section 6.1 — Audit Right. Apex shall have the right, exercisable no more than once during any calendar year, to engage an independent certified public accounting firm of nationally recognized standing, reasonably acceptable to Solstice (such acceptance not to be unreasonably withheld, conditioned, or delayed), to examine and audit those books, records, accounts, and supporting documentation of Solstice and its Affiliates as are reasonably necessary to verify the completeness and accuracy of the royalty reports and Running Royalty payments made by Solstice under Section 3.2 of this Agreement. Any such audit shall be conducted: (i) during Solstice's normal business hours at its principal offices or such other location where the relevant records are maintained; (ii) upon not less than thirty (30) days' prior written notice from Apex to Solstice specifying the proposed dates of the audit and the identity of the auditing firm; and (iii) in a manner that minimizes disruption to Solstice's normal business operations. The scope of any audit conducted pursuant to this Section 6.1 shall be limited to the verification of Net Sales, the deductions applied in calculating Net Sales, and the resulting Running Royalty calculations, and shall cover a period not to exceed the three (3) calendar years immediately preceding the date of Apex's written audit notice.

Section 6.2 — Cost of Audit. The cost of any audit conducted pursuant to Section 6.1, including the fees and expenses of the independent auditing firm, shall be borne solely by Apex; provided, however, that if such audit reveals an underpayment of Running Royalties by Solstice exceeding five percent (5%) of the aggregate amount of Running Royalties that were due and payable for any audited period (as determined on an annualized basis), then Solstice shall bear and promptly reimburse Apex for the reasonable cost of such audit, including all fees and expenses of the auditing firm.

Section 6.3 — Underpayment / Overpayment. In the event that an audit conducted pursuant to Section 6.1 reveals an underpayment of Running Royalties by Solstice, Solstice shall pay to Apex the full amount of such underpayment within thirty (30) days of written notice from Apex setting forth the audit findings and the amount of the underpayment, together with interest on such underpaid amount calculated at the rate set forth in Section 3.1(c) from the date such payment was originally due until the date of actual payment. In the event that an audit reveals an overpayment of Running Royalties by Solstice, such overpayment shall, at Solstice's sole election, be either (x) credited against future Running Royalty payments due from Solstice to Apex under Section 3.2, or (y) refunded by Apex to Solstice by wire transfer within thirty (30) days of written notice from Solstice electing a refund.

Section 6.4 — Confidentiality of Audit. Prior to commencing any audit under this Article VI, the independent auditing firm engaged by Apex shall execute a confidentiality agreement, in form and substance reasonably acceptable to Solstice, limiting the disclosure of any information obtained during the audit to the following: (a) the fact and amount of any underpayment or overpayment of Running Royalties; and (b) a summary of the auditing firm's findings and conclusions necessary to support any claim of underpayment or overpayment. The auditing firm shall not disclose to Apex or to any other person or entity any detailed financial information, customer lists, pricing data, sales volumes by customer, or other competitively sensitive business information of Solstice obtained during the audit, except to the extent such information is strictly necessary to calculate and report the amount of any underpayment or overpayment. Solstice shall have the right to review and approve any audit report before it is delivered to Apex, solely for the purpose of verifying compliance with the confidentiality restrictions set forth in this Section 6.4.

ARTICLE VII — MUTUAL RELEASE

Section 7.1 — Solstice's Release of Apex. Effective as of the Effective Date, Solstice (including both Solstice Parent and Solstice US), on behalf of itself and each of its Affiliates, and each of their respective officers, directors, employees, agents, representatives, predecessors, successors, heirs, executors, administrators, and assigns (collectively, the "Solstice Releasing Parties"), hereby irrevocably and unconditionally releases, acquits, and forever discharges Apex and each of its Affiliates, and each of their respective officers, directors (including without limitation Gerald K. Whitford, Dr. Priya Chandrasekaran, Martin Hale, and Dr. Raymond Szabo), employees, agents, representatives, predecessors, successors, heirs, executors, administrators, assigns, insurers, and outside counsel (including without limitation Hargrove, Tate & Bennington LLP and each of its partners, associates, and employees) (collectively, the "Apex Released Parties"), from any and all claims, counterclaims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, covenants, contracts, controversies, agreements, promises, damages, judgments, executions, obligations, and liabilities of every kind and nature whatsoever, whether at law or in equity, whether known or unknown, suspected or unsuspected, foreseen or unforeseen, matured or unmatured, contingent or non-contingent, that the Solstice Releasing Parties have, have had, or may have against any of the Apex Released Parties, arising out of, relating to, or in connection with the Asserted Patents, the Accused Products, or the Action, from the beginning of time through and including the Effective Date. Without limiting the generality of the foregoing, the release set forth in this Section 7.1 specifically includes and encompasses: (i) all counterclaims for declaratory judgment of non-infringement of the Asserted Patents; (ii) all counterclaims for declaratory judgment of invalidity of the Asserted Patents; (iii) all affirmative defenses and counterclaims based on inequitable conduct; and (iv) all claims for attorneys' fees, costs, and expenses incurred in connection with the Action.

Section 7.2 — Apex's Release of Solstice. Effective as of the Effective Date, Apex, on behalf of itself and each of its Affiliates, and each of their respective officers, directors, employees, agents, representatives, predecessors, successors, heirs, executors, administrators, and assigns (collectively, the "Apex Releasing Parties"), hereby irrevocably and unconditionally releases, acquits, and forever discharges Solstice (including both Solstice Parent and Solstice US) and each of its Affiliates, and each of their respective officers, directors (including without limitation Dr. Fiona Tierney, Eamon Rourke, Niamh Cassidy, and Brendan Molloy), employees, agents, representatives, predecessors, successors, heirs, executors, administrators, assigns, insurers, and outside counsel (including without limitation Calderwood & Harkness LLP and each of its partners, associates, and employees) (collectively, the "Solstice Released Parties"), from any and all claims, counterclaims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, covenants, contracts, controversies, agreements, promises, damages, judgments, executions, obligations, and liabilities of every kind and nature whatsoever, whether at law or in equity, whether known or unknown, suspected or unsuspected, foreseen or unforeseen, matured or unmatured, contingent or non-contingent, that the Apex Releasing Parties have, have had, or may have against any of the Solstice Released Parties, arising out of, relating to, or in connection with the Asserted Patents, the Accused Products, the Apex Trocar Patent Family (to the extent arising from acts occurring prior to the Effective Date), or the Action, from the beginning of time through and including the Effective Date. Without limiting the generality of the foregoing, the release set forth in this Section 7.2 specifically includes and encompasses all claims for patent infringement (direct, contributory, and induced), willful patent infringement, and enhanced damages, as well as all claims for attorneys' fees, costs, and expenses incurred in connection with the Action.

Section 7.3 — Scope of Release. The releases set forth in Sections 7.1 and 7.2 include, without limitation, all claims and causes of action for patent infringement (whether direct, literal, or under the doctrine of equivalents), contributory infringement, inducement of infringement, willful infringement, and all defenses, affirmative defenses, and counterclaims that were asserted or could have been asserted by any Party in the Action. The Parties acknowledge that the scope of the releases is intended to be as broad as possible and to encompass all disputes between the Parties relating to the Asserted Patents, the Accused Products, and the Action. Notwithstanding the foregoing, the releases set forth in this Article VII shall not extend to, and shall not release any Party from, any obligation, liability, or claim arising under or pursuant to this Agreement, the Patent License Agreement, the Covenant Not to Sue, the Escrow Agreement, or any other ancillary document executed in connection herewith.

Section 7.4 — Waiver of Unknown Claims. Each Party acknowledges that it may discover facts, claims, or defenses in addition to or different from those that it now knows or believes to exist with respect to the subject matter of the releases set forth in this Article VII, and that the existence of such additional or different facts, claims, or defenses may materially affect the claims and defenses released hereby. Each Party hereby expressly, knowingly, voluntarily, and intentionally waives and relinquishes any and all rights and benefits that it may have under any statute, regulation, common law principle, or rule of equity that would otherwise limit the release set forth herein to those claims, demands, and causes of action that are known or suspected to exist at the time of execution of this Agreement, including without limitation any rights under California Civil Code Section 1542 (to the extent applicable) or any similar provision of the laws of any other jurisdiction. Each Party acknowledges that this waiver is an essential and material term of this Agreement and that, without such waiver, this Agreement would not have been entered into.

ARTICLE VIII — DISMISSAL OF THE ACTION

Section 8.1 — Stipulation of Dismissal. Within fifteen (15) days following the Effective Date (and in any event on or before July 1, 2025), the Parties shall cause their respective outside litigation counsel — Calderwood & Harkness LLP (on behalf of Solstice US) and Hargrove, Tate & Bennington LLP (on behalf of Apex) — to execute and file the Stipulation of Dismissal with Prejudice in substantially the form attached hereto as Exhibit E with the Clerk of the United States District Court for the District of Delaware in the Action (Case No. 1:24-cv-00587-RGA). Each Party shall instruct its counsel to cooperate fully and to take all actions reasonably necessary to effect the filing of the Stipulation of Dismissal within the time period specified herein.

Section 8.2 — Terms of Dismissal. The Stipulation of Dismissal shall provide for the dismissal with prejudice of all claims and counterclaims asserted in the Action, including Apex's claims for patent infringement and Solstice US's counterclaims for declaratory judgment of non-infringement and invalidity and its affirmative defense of inequitable conduct. Each Party shall bear its own costs, expenses, and attorneys' fees incurred in connection with the Action, and no Party shall seek or be entitled to any award of costs or attorneys' fees from the other Party in connection with the Action. The Stipulation of Dismissal shall further provide that the United States District Court for the District of Delaware shall retain jurisdiction solely for the purpose of enforcing the terms of this Agreement, as set forth in Article XII.

Section 8.3 — Vacatur of Trial Date. Promptly following the full execution of this Agreement (and in any event within five (5) business days of the Effective Date), the Parties shall jointly move the Court, or jointly request through a letter to Chief Judge Andrews' chambers, to vacate the September 30, 2025 trial date and all remaining case deadlines, pending the filing of the Stipulation of Dismissal. The Parties shall cooperate in good faith to prepare and file any submissions necessary to accomplish the vacatur of the trial date and related deadlines.

ARTICLE IX — CONFIDENTIALITY

Section 9.1 — Confidentiality Obligations. Each Party agrees that it shall maintain in strict confidence, and shall not disclose, disseminate, publish, or otherwise communicate to any third party, directly or indirectly, any Confidential Information, except as follows:

(a) Internal Disclosure. A Party may disclose Confidential Information to its own officers, directors, employees, accountants, financial advisors, and legal counsel who have a need to know such information in connection with the implementation, administration, or enforcement of this Agreement, provided that each such recipient is bound by obligations of confidentiality no less restrictive than those set forth in this Article IX. For purposes of this exception, Solstice's outside accountants are Glenmore & Byrne LLP, and Apex's outside accountants are Creston Perry LLP.

(b) Legal or Regulatory Compulsion. A Party may disclose Confidential Information to the extent required by applicable law, statute, regulation, court order, subpoena, civil investigative demand, or the rules or requirements of any governmental authority, regulatory body, or stock exchange having jurisdiction over such Party, provided that the disclosing Party shall (to the extent legally permissible) provide the other Party with prompt written notice of such requirement prior to disclosure, together with a copy of the order, subpoena, or other document requiring such disclosure, and shall cooperate with the other Party's reasonable efforts to obtain a protective order or other appropriate remedy to limit the scope or extent of such disclosure.

(c) Enforcement. A Party may disclose Confidential Information in connection with any proceeding to enforce the terms of this Agreement, the Patent License Agreement, the Escrow Agreement, or any other ancillary document executed in connection herewith.

(d) Change of Control. A Party may disclose Confidential Information to a bona fide potential acquirer of such Party (or substantially all of such Party's assets) in connection with due diligence for a potential Change of Control, provided that such potential acquirer has first executed a written confidentiality agreement with the disclosing Party containing terms no less protective of the Confidential Information than those set forth in this Article IX.

(e) Insurance Reporting. Solstice may disclose Confidential Information to Halcyon Specialty Insurance Co. (or its successor) to the extent reasonably necessary for Solstice's insurance reporting and coverage determination purposes, provided that Solstice shall use commercially reasonable efforts to limit the scope of any such disclosure and to ensure that Halcyon Specialty Insurance Co. maintains the confidentiality of the information so disclosed.

Section 9.2 — Joint Public Statement. The Parties agree that the only public statement to be made by or on behalf of either Party (or any Affiliate of either Party) regarding the settlement of the Action and the execution of this Agreement shall be the Agreed Joint Public Statement attached hereto as Exhibit F, which shall state that "the matter has been resolved on mutually agreeable terms." No Party shall issue any press release, public filing, blog post, social media communication, investor communication, or other public statement beyond the Agreed Joint Public Statement that discloses the existence, terms, or conditions of this Agreement (including the financial terms) without the prior written consent of the other Party, which consent may be withheld in such Party's sole discretion. Notwithstanding the foregoing, this Section 9.2 shall not prevent either Party from making such disclosures as may be required by applicable securities laws, stock exchange rules, or governmental authorities, subject to the notice and cooperation requirements of Section 9.1(b).

Section 9.3 — Injunctive Relief. Each Party acknowledges and agrees that any breach or threatened breach of the confidentiality obligations set forth in this Article IX would cause immediate and irreparable harm to the non-breaching Party, the extent of which would be difficult or impossible to quantify, and for which monetary damages would be an inadequate remedy. Accordingly, in addition to all other rights and remedies available at law or in equity, the non-breaching Party shall be entitled to seek temporary, preliminary, and permanent injunctive relief, specific performance, and other equitable relief to enforce the provisions of this Article IX, without the necessity of proving actual damages, posting any bond or other security, or meeting any similar requirement under applicable law.

ARTICLE X — TERM AND TERMINATION

Section 10.1 — Term. This Agreement shall become effective on the Effective Date and, unless earlier terminated in accordance with this Article X, shall continue in full force and effect until the expiration of the last to expire of the Licensed Patents (i.e., the '105 Patent, expiring January 10, 2038). Notwithstanding the foregoing or any other provision of this Agreement, the mutual releases set forth in Article VII and the dismissal provisions set forth in Article VIII are irrevocable and shall survive any termination or expiration of this Agreement. Upon expiration of the term, all licenses and covenants granted under this Agreement with respect to expired Licensed Patents shall have lapsed, and no further Running Royalty payments shall be due.

Section 10.2 — Termination for Material Breach. Either Party may terminate this Agreement (other than Article VII, Article VIII, and the other surviving provisions set forth in Section 10.3) upon written notice to the other Party if the other Party commits a material breach of any provision of this Agreement and fails to cure such breach within sixty (60) days after receipt of written notice from the non-breaching Party specifying the nature of the breach in reasonable detail and demanding cure. Without limiting the generality of the foregoing, a failure by Solstice to make any payment of the Lump-Sum Payment or any Running Royalty payment when due under Article III, which failure continues uncured for sixty (60) days following receipt of written notice thereof, shall constitute a material breach of this Agreement. In the event of termination by Apex due to Solstice's failure to make any payment under Article III, the Patent License Agreement and the Covenant Not to Sue shall immediately and automatically terminate, and all rights of Apex under the Asserted Patents and the Apex Trocar Patent Family shall be fully restored as if the Patent License Agreement and Covenant Not to Sue had not been granted, without prejudice to Apex's right to recover any unpaid amounts (including accrued interest under Section 3.1(c)) and any other damages to which Apex may be entitled at law or in equity.

Section 10.3 — Survival. The following provisions of this Agreement shall survive the expiration or termination of this Agreement for any reason and shall remain in full force and effect: Article I (Definitions), Section 3.3 (Tax Treatment), Section 3.4 (No Coverage by Insurance), Sections 6.1 through 6.4 (Audit Rights), Article VII (Mutual Release), Article VIII (Dismissal of the Action), Art

SETTLEMENT AGREEMENT AND MUTUAL RELEASE
EXECUTION VERSION
June 16, 2025
BETWEEN AND AMONG
SOLSTICE BIOMEDICAL DEVICES LTD. a private limited company organized under the laws of Ireland
SOLSTICE BIOMEDICAL, INC. a Delaware corporation
and
APEX SURGICAL INNOVATIONS, INC. a Delaware corporation
SETTLEMENT AGREEMENT AND MUTUAL RELEASE
This Settlement Agreement and Mutual Release (this "Agreement") is entered into as of June 16, 2025 (the "Effective Date"), by and among:
Solstice Biomedical Devices Ltd., a private limited company organized and existing under the laws of Ireland (CRO No. 648217), with its registered office at Unit 14, Clonskeagh Business Park, Clonskeagh Road, Dublin 14, D14 YF28, Ireland ("SBD" or "Solstice Parent");
Solstice Biomedical, Inc., a corporation organized and existing under the laws of the State of Delaware (EIN: 84-3291056), with its principal offices at 3800 Concord Pike, Suite 410, Wilmington, Delaware 19803 ("Solstice US," and together with Solstice Parent, "Solstice"); and
Apex Surgical Innovations, Inc., a corporation organized and existing under the laws of the State of Delaware (EIN: 51-0483762), with its principal office at 1220 North Market Street, Suite 550, Wilmington, Delaware 19801 ("Apex").
Solstice and Apex are each referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
A. Apex is the owner by assignment of all right, title, and interest in and to certain United States utility patents, including: (i) U.S. Patent No. 9,814,237 (the "'237 Patent"), entitled "Locking Seal Assembly for Minimally Invasive Surgical Access Device," issued on November 14, 2017 by the United States Patent and Trademark Office ("USPTO"), with an expiration date of June 22, 2035; (ii) U.S. Patent No. 10,271,884 (the "'884 Patent"), entitled "Retractable Blade Deployment Mechanism for Trocar Systems," issued on April 30, 2019, with an expiration date of September 15, 2036; and (iii) U.S. Patent No. 10,932,105 (the "'105 Patent"), entitled "Integrated Insufflation Valve and Seal for Laparoscopic Trocar," issued on March 2, 2021, with an expiration date of January 10, 2038. The '237 Patent, '884 Patent, and '105 Patent are collectively referred to herein as the "Asserted Patents." The named inventor on each of the Asserted Patents is Dr. Raymond Szabo, Vice President of Engineering at Apex. The Asserted Patents form part of a broader patent family comprising fourteen (14) issued United States patents and six (6) pending continuation applications (the "Apex Trocar Patent Family"), as more fully described in Exhibit C attached hereto.
B. Solstice Parent is an Irish-domiciled private limited company that designs, develops, manufactures, and distributes minimally invasive surgical instruments and related accessories. Solstice Parent was founded in 2011, reported fiscal year 2023 revenue of approximately €187.4 million, and employs approximately 620 persons worldwide. Solstice US is a wholly owned subsidiary of Solstice Parent and is responsible for the marketing, distribution, and sale of Solstice's products within the United States. Among its product lines, Solstice designs, manufactures, and sells laparoscopic trocar assemblies under the PrecisionEdge™ brand, including the PE-5000 Series (5 mm diameter), the PE-12000 Series (12 mm diameter), and the PE-15000 Series (15 mm diameter) (collectively, the "Accused Products").
C. On May 9, 2024, Apex filed a complaint for patent infringement against Solstice US in the United States District Court for the District of Delaware, captioned Apex Surgical Innovations, Inc. v. Solstice Biomedical, Inc., Case No. 1:24-cv-00587-RGA, assigned to Chief Judge Richard G. Andrews (the "Action" or "Litigation"). In the Action, Apex alleged that the Accused Products infringe one or more claims of the Asserted Patents, specifically: (i) the PE-5000 Series was alleged to infringe the '237 Patent and the '884 Patent; (ii) the PE-12000 Series was alleged to infringe all three Asserted Patents; and (iii) the PE-15000 Series was alleged to infringe the '884 Patent and the '105 Patent. Solstice US was served with the complaint on May 23, 2024, and on June 14, 2024 filed its Answer, Affirmative Defenses, and Counterclaims, asserting, among other things, non-infringement of each of the Asserted Patents, invalidity of the asserted claims under 35 U.S.C. §§ 102 and 103, inequitable conduct, and counterclaims for declaratory judgment of non-infringement and invalidity of the Asserted Patents. Thereafter, the Parties engaged in extensive fact and expert discovery, exchanged opening and rebuttal expert reports, and participated in a Markman hearing on November 18, 2024 before Chief Judge Andrews. The Court issued its Claim Construction Order on December 6, 2024. Cross-motions for summary judgment were fully briefed and argued, and were denied by Order dated May 5, 2025. The Action was scheduled for trial on September 30, 2025.
D. The Parties participated in a mediation session on March 17, 2025 before the Honorable Margaret Forsythe (Ret.) of Amberstone ADR Services in Wilmington, Delaware. That mediation did not result in a resolution of the dispute. The Parties subsequently participated in a second settlement conference on May 12, 2025 before Magistrate Judge Colleen Pratt. Following intensive arm's-length settlement negotiations conducted between May 19 and June 4, 2025, the Parties reached agreement in principle on the key terms of settlement and memorialized those terms in a Term Sheet executed by authorized representatives of the Parties on June 10, 2025 (the "Term Sheet").
E. The Parties now desire to fully and finally resolve all claims, counterclaims, defenses, and disputes between and among them arising out of or relating to the Action, the Asserted Patents, the Accused Products, and the Apex Trocar Patent Family, on the terms and conditions set forth in this Agreement. Solstice's outside litigation counsel in the Action is the firm of Calderwood & Harkness LLP (Marcus Delgado, Responsible Partner), 1201 Market Street, Suite 2500, Wilmington, Delaware 19801. Apex's outside litigation counsel in the Action is the firm of Hargrove, Tate & Bennington LLP (Victoria Stanton, Lead Partner), 900 North King Street, Suite 1200, Wilmington, Delaware 19801.
F. NOW, THEREFORE, in consideration of the mutual promises, covenants, releases, and other obligations set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each Party, the Parties agree as follows:
ARTICLE I — DEFINITIONS
Section 1.1 — Defined Terms. As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not defined in this Section 1.1 shall have the meanings assigned to them elsewhere in this Agreement.
"Accused Products" means the PrecisionEdge™ PE-5000 Series (5 mm), PE-12000 Series (12 mm), and PE-15000 Series (15 mm) laparoscopic trocar assemblies designed, manufactured, marketed, and sold by Solstice, as identified in the complaint and amended pleadings in the Action.
"Action" means the civil action captioned Apex Surgical Innovations, Inc. v. Solstice Biomedical, Inc., Case No. 1:24-cv-00587-RGA, pending in the United States District Court for the District of Delaware.
"Affiliate" means, with respect to a Party, any entity that directly or indirectly controls, is controlled by, or is under common control with such Party, where "control" means the direct or indirect ownership of more than fifty percent (50%) of the voting securities of, or equivalent ownership interest in, such entity.
"Agreed Joint Public Statement" means the joint public statement agreed upon by the Parties in the form attached hereto as Exhibit F.
"Apex Trocar Patent Family" means the fourteen (14) issued United States patents and six (6) pending continuation applications related to trocar and laparoscopic access device technology owned by Apex as listed on Exhibit C attached hereto, including the Asserted Patents.
"Asserted Patents" means, collectively, U.S. Patent No. 9,814,237, U.S. Patent No. 10,271,884, and U.S. Patent No. 10,932,105.
"Calendar Quarter" means each three-month period ending on March 31, June 30, September 30, and December 31 of each calendar year. For purposes of this Agreement, the first Calendar Quarter following the Effective Date shall include the period from the Effective Date through June 30, 2025, and the last Calendar Quarter shall include the period through the expiration of the last-to-expire Licensed Patent.
"Change of Control" means, with respect to Solstice Parent or Solstice US, as applicable, any of the following: (i) the acquisition by any third party (other than an Affiliate) of more than fifty percent (50%) of the outstanding voting securities of Solstice Parent or Solstice US; (ii) any merger, consolidation, or similar business combination transaction involving Solstice Parent or Solstice US following which the holders of the voting securities of the applicable Solstice entity immediately prior to such transaction do not retain majority control of the surviving or resulting entity; or (iii) the sale, transfer, exclusive license, or other disposition of all or substantially all of the assets of Solstice Parent or Solstice US.
"Confidential Information" means the terms and conditions of this Agreement (including all Exhibits hereto), the Escrow Agreement, the Term Sheet, the Side Letter, and all oral and written communications, proposals, draft agreements, negotiation correspondence, and other materials exchanged between or among the Parties and their respective counsel, agents, and representatives in connection with the settlement negotiations that gave rise to this Agreement, subject to the exceptions set forth in Section 9.1.
"Covenant Not to Sue" means the covenant set forth in Section 4.2 of this Agreement and more fully described in the document attached hereto as Exhibit B.
"Effective Date" means June 16, 2025, the date on which this Agreement has been fully executed by all Parties.
"Escrow Agent" means Tidewater Fiduciary Services, Inc., a Delaware corporation, with offices at 300 Delaware Avenue, Suite 1400, Wilmington, Delaware 19801.
"Escrow Agreement" means the escrow agreement of even date herewith entered into by and among Solstice, Apex, and the Escrow Agent, governing the deposit, holding, and release of the Lump-Sum Payment.
"Licensed Field" means laparoscopic surgical access devices, including laparoscopic trocars, trocar assemblies, and related components for use in minimally invasive surgical procedures.
"Licensed Patents" means the Asserted Patents and any continuations, divisionals, reissues, or reexamination certificates thereof.
"Licensed Products" means the PrecisionEdge™ PE-5000 Series, PE-12000 Series, and PE-15000 Series laparoscopic trocar assemblies, and any successor products thereto, but only to the extent such products fall within the scope of one or more claims of the Licensed Patents in the Licensed Field.
"Lower Rate License" has the meaning set forth in Section 5.1.
"Lump-Sum Payment" means the aggregate sum of Eight Million Seven Hundred Fifty Thousand United States Dollars ($8,750,000) payable by Solstice to Apex pursuant to Section 3.1.
"Net Sales" means the gross amounts invoiced by Solstice or any of its Affiliates or authorized sublicensees for sales of Licensed Products to unaffiliated third parties, less the following deductions to the extent actually incurred or accrued and separately identified on the applicable invoice or in Solstice's books and records maintained in accordance with U.S. generally accepted accounting principles ("GAAP") or International Financial Reporting Standards ("IFRS"), as applicable: (a) returns, credits, and allowances actually granted; (b) trade discounts, quantity discounts, rebates, and chargebacks actually allowed or paid; (c) freight, shipping, handling, and insurance charges included in the invoiced price; and (d) sales, use, value-added, excise, and similar governmental taxes and duties included in the invoiced price. Net Sales shall not include sales or transfers between or among Solstice and its Affiliates for resale, provided that Net Sales shall include the subsequent sale to an unaffiliated third party. In the event a Licensed Product is sold as part of a combination or bundled product together with other products or components that are not Licensed Products, Net Sales for purposes of calculating the Running Royalty shall be calculated by multiplying the gross amount invoiced for such combination product by a fraction, the numerator of which is the average standalone selling price of the Licensed Product component and the denominator of which is the average standalone selling price of all components of the combination product, each as determined from Solstice's price lists or, if no standalone prices exist, as reasonably determined by Solstice and subject to audit under Article VI.
"Patent License Agreement" means the Non-Exclusive Patent License Agreement in the form attached hereto as Exhibit A.
"Royalty Cap" means One Million Eight Hundred Thousand United States Dollars ($1,800,000) per calendar year, as more fully described in Section 3.2(b).
"Royalty Floor" means Five Hundred Thousand United States Dollars ($500,000) per calendar year, beginning with calendar year 2026, as more fully described in Section 3.2(a).
"Running Royalty" means the royalty of three and three-quarters percent (3.75%) of Net Sales of Licensed Products payable by Solstice to Apex pursuant to Section 3.2.
"Side Letter" means the side letter agreement of even date herewith between Solstice and Apex relating to the notification protocol for the most-favored licensee provision set forth in Article V.
"Stipulation of Dismissal" means the stipulation of dismissal with prejudice in substantially the form attached hereto as Exhibit E, to be filed in the Action.
"Term Sheet" means the binding term sheet executed by authorized representatives of the Parties on June 10, 2025, setting forth the principal terms of settlement, which term sheet is superseded in its entirety by this Agreement.
"Tranche 1" means Five Million Two Hundred Fifty Thousand United States Dollars ($5,250,000), as more fully described in Section 3.1(a).
"Tranche 2" means Three Million Five Hundred Thousand United States Dollars ($3,500,000), as more fully described in Section 3.1(b).
Section 1.2 — Rules of Construction. Unless the context otherwise requires: (a) the headings of Articles and Sections contained in this Agreement are for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement; (b) words importing the singular shall include the plural and vice versa, and words importing any gender shall include all genders; (c) the word "including" (and its grammatical variations) means "including, without limitation," and shall not be construed to limit any general statement that it follows to the specific or similar items or matters immediately following it; (d) references to "Sections," "Articles," and "Exhibits" are to Sections, Articles, and Exhibits of and to this Agreement unless the context otherwise requires; (e) references to any agreement, document, or instrument shall mean such agreement, document, or instrument as amended, supplemented, or modified from time to time in accordance with its terms and this Agreement; (f) references to any statute, rule, or regulation shall include all amendments thereto and all rules and regulations promulgated thereunder; and (g) references to "days" shall mean calendar days unless "business days" is expressly specified.
ARTICLE II — REPRESENTATIONS AND WARRANTIES
Section 2.1 — Mutual Representations and Warranties. Each Party hereby represents and warrants to each other Party, as of the Effective Date, as follows:
(a) Organization and Good Standing. Such Party is duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization: Solstice Parent under the laws of Ireland; Solstice US under the laws of the State of Delaware; and Apex under the laws of the State of Delaware. Each Party is duly qualified or licensed to do business in each jurisdiction in which the nature of its business or the ownership or leasing of its properties requires such qualification, except where the failure to be so qualified would not reasonably be expected to have a material adverse effect on such Party's ability to perform its obligations under this Agreement.
(b) Authority. Such Party has full corporate power and authority to enter into, execute, deliver, and perform its obligations under this Agreement and each of the ancillary documents contemplated hereby to which it is or will be a party.
(c) Due Authorization. The execution, delivery, and performance of this Agreement and the ancillary documents contemplated hereby have been duly authorized by all necessary corporate action on the part of such Party, including all requisite approvals of such Party's board of directors (or equivalent governing body). No additional corporate action on the part of such Party or its shareholders or members is necessary to authorize the execution, delivery, or performance of this Agreement.
(d) Enforceability. This Agreement constitutes a legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and other similar laws affecting creditors' rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith, and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity).
(e) No Consents Required. No consent, approval, order, or authorization of, or registration, declaration, or filing with, any governmental authority, regulatory body, or third party is required on the part of such Party in connection with the execution, delivery, and performance of this Agreement, except as expressly contemplated herein or as may be required in connection with the filing of the Stipulation of Dismissal or any required reports under applicable securities laws.
(f) No Conflicts. The execution, delivery, and performance by such Party of this Agreement and the ancillary documents contemplated hereby do not and will not (i) violate, conflict with, or result in a breach of any provision of such Party's certificate of incorporation, bylaws, memorandum of association, articles of association, or other organizational documents; (ii) violate, conflict with, or result in a breach or default (or an event that, with notice or lapse of time or both, would constitute a default) under any material agreement, contract, or instrument to which such Party is a party or by which such Party or its properties are bound; or (iii) violate any applicable law, statute, rule, regulation, order, judgment, decree, or injunction of any court or governmental authority applicable to such Party.
Section 2.2 — Apex's Representations and Warranties. Apex hereby additionally represents and warrants to Solstice, as of the Effective Date, as follows:
(a) Ownership of Asserted Patents. Apex is the sole and exclusive owner of the entire right, title, and interest in and to each of the Asserted Patents and each patent and patent application in the Apex Trocar Patent Family, free and clear of all liens, encumbrances, security interests, pledges, mortgages, charges, and adverse claims of any kind, other than non-exclusive licenses previously granted by Apex to third parties in the ordinary course of business prior to the Effective Date, none of which would materially impair Apex's ability to grant the license and covenant contemplated by this Agreement.
(b) Right to Grant License and Covenant. Apex has the full and unrestricted right and authority to grant the patent license and covenant not to sue contemplated by Article IV of this Agreement and the exhibits attached hereto without the consent, approval, or authorization of any third party, including without limitation any co-owner, co-inventor, licensee, or other person or entity having any interest in the Asserted Patents or the Apex Trocar Patent Family.
(c) Subsisting Patents. Each of the Asserted Patents is subsisting, has been duly issued by the USPTO, and has not been adjudicated invalid, unenforceable, or not infringed by any court, tribunal, or administrative body of competent jurisdiction in a final, non-appealable decision. All required maintenance fees for the Asserted Patents have been timely paid, and all necessary post-issuance filings have been duly made.
(d) No Pending Proceedings. To Apex's knowledge, as of the Effective Date, no reexamination, inter partes review, post-grant review, covered business method review, or any other proceeding before the USPTO or any other patent office or administrative body is pending with respect to any of the Asserted Patents.
(e) Inventor Assignment. Dr. Raymond Szabo, the named inventor on each of the Asserted Patents, has executed valid and binding assignments of all right, title, and interest in and to the Asserted Patents to Apex, and such assignments have been duly recorded with the USPTO. No other individual or entity has any claim to inventorship or ownership of any of the Asserted Patents.
Section 2.3 — Solstice's Representations and Warranties. Solstice hereby additionally represents and warrants to Apex, as of the Effective Date, as follows:
(a) Subsidiary Relationship. Solstice US is a direct, wholly owned subsidiary of Solstice Parent. All of the outstanding shares of capital stock of Solstice US are owned, beneficially and of record, by Solstice Parent, free and clear of all liens, encumbrances, and restrictions (other than restrictions on transfer imposed by applicable securities laws).
(b) Financial Capability. Solstice has the present financial capability and sufficient available resources to make all payments contemplated by this Agreement, including the Lump-Sum Payment and the Running Royalty payments, and does not know of any reason that would prevent or impair Solstice from making such payments when due.
(c) Books and Records. Solstice maintains true, accurate, and complete books and records of all sales, transfers, and other dispositions of Licensed Products, in conformity with GAAP or IFRS, as applicable, in sufficient detail to permit the accurate calculation of Net Sales and the Running Royalty. Solstice shall continue to maintain such books and records throughout the term of this Agreement and for a period of three (3) years following the expiration or termination of this Agreement.
ARTICLE III — PAYMENT TERMS
Section 3.1 — Lump-Sum Payment. In partial consideration for the releases granted in Article VII, the license granted in Article IV, and the covenant not to sue set forth in Section 4.2 and Exhibit B, Solstice shall pay to Apex an aggregate lump-sum settlement payment of Eight Million Seven Hundred Fifty Thousand United States Dollars ($8,750,000) (the "Lump-Sum Payment"), payable in two tranches as follows:
(a) Tranche 1. Within ten (10) business days following the Effective Date (and in no event later than June 30, 2025), Solstice shall pay to the Escrow Agent, by wire transfer of immediately available funds in accordance with the wire instructions set forth in the Escrow Agreement, the sum of Five Million Two Hundred Fifty Thousand United States Dollars ($5,250,000) ("Tranche 1"). Upon confirmation of the receipt of Tranche 1 into the escrow account maintained by the Escrow Agent, the Escrow Agent shall release the Tranche 1 funds to Apex by wire transfer to the bank account designated by Apex in the Escrow Agreement within three (3) business days of deposit. Solstice shall provide Apex with written confirmation of the wire transfer to the Escrow Agent promptly following its initiation.
(b) Tranche 2. On or before September 15, 2025, Solstice shall pay to the Escrow Agent, by wire transfer of immediately available funds in accordance with the wire instructions set forth in the Escrow Agreement, the sum of Three Million Five Hundred Thousand United States Dollars ($3,500,000) ("Tranche 2"). Upon confirmation of the receipt of Tranche 2 into the escrow account maintained by the Escrow Agent, the Escrow Agent shall release the Tranche 2 funds to Apex by wire transfer to the bank account designated by Apex in the Escrow Agreement within three (3) business days of deposit. Solstice shall provide Apex with written confirmation of the wire transfer to the Escrow Agent promptly following its initiation.
(c) Late Payment. Any portion of the Lump-Sum Payment or any Running Royalty payment not paid when due shall bear interest from the applicable due date until the date of actual payment at a rate equal to the lesser of (i) one and one-half percent (1.5%) per month (eighteen percent (18%) per annum) and (ii) the maximum rate of interest permitted by applicable law. The accrual of interest under this Section 3.1(c) shall not limit or waive any other rights or remedies available to Apex, including Apex's right to terminate the Patent License Agreement upon a material breach of payment obligations, as set forth in Section 10.2 of this Agreement. Any interest payable hereunder shall be computed on the basis of a 360-day year composed of twelve 30-day months.
Section 3.2 — Running Royalty. Beginning on the Effective Date and continuing for the remaining life of each Licensed Patent (with the last-to-expire Licensed Patent being the '105 Patent, expiring January 10, 2038), Solstice shall pay to Apex a running royalty equal to three and three-quarters percent (3.75%) of Net Sales of Licensed Products (the "Running Royalty"), subject to the Royalty Floor and Royalty Cap set forth below.
(a) Royalty Floor. Beginning with calendar year 2026, and for each full calendar year thereafter during the term of this Agreement, the minimum annual Running Royalty payable by Solstice to Apex shall be Five Hundred Thousand United States Dollars ($500,000) (the "Royalty Floor"). If the aggregate Running Royalty payments actually due and paid with respect to Net Sales for a given calendar year are less than the Royalty Floor, Solstice shall pay the difference between the actual aggregate Running Royalty and the Royalty Floor within thirty (30) days following the end of such calendar year. For the avoidance of doubt, the Royalty Floor shall not apply to the partial calendar year 2025 (i.e., the period from the Effective Date through December 31, 2025), nor to any partial calendar year at the end of the term resulting from the expiration of the last Licensed Patent. The Royalty Floor shall be prorated for any partial calendar year at the end of the term.
(b) Royalty Cap. The maximum aggregate Running Royalty payable by Solstice to Apex in any single calendar year shall not exceed One Million Eight Hundred Thousand United States Dollars ($1,800,000) (the "Royalty Cap"). Once cumulative Running Royalty payments for a given calendar year reach the Royalty Cap, no further Running Royalty shall be due or payable for the remainder of that calendar year. The Royalty Cap shall be prorated for any partial calendar year at the beginning or end of the term.
(c) Royalty Reporting. Solstice shall deliver to Apex a written quarterly royalty report, in substantially the form attached hereto as Exhibit D, within forty-five (45) days after the end of each Calendar Quarter. Each such royalty report shall include, at a minimum, the following information for the applicable Calendar Quarter, broken out by Licensed Product (PE-5000 Series, PE-12000 Series, and PE-15000 Series) and, within each Licensed Product, by geographic market (United States and international): (i) gross invoiced sales; (ii) itemized deductions for returns and allowances, trade discounts, rebates and chargebacks, freight and shipping charges, and applicable taxes; (iii) the resulting calculation of Net Sales; and (iv) the Running Royalty amount due for such Calendar Quarter. Each royalty report shall be certified as true, complete, and accurate by an authorized officer of Solstice, which certification shall be in the form set forth in Exhibit D.
(d) Royalty Payments. Running Royalty payments shall be due and payable within forty-five (45) days after the end of each Calendar Quarter, concurrently with the delivery of the corresponding royalty report. All Running Royalty payments shall be made by wire transfer of immediately available funds to a bank account designated by Apex in writing from time to time. Apex shall provide Solstice with its initial wire instructions within five (5) business days of the Effective Date and shall provide not less than fifteen (15) days' prior written notice of any change in wire instructions. All Running Royalty payments shall be made in United States Dollars. To the extent any Net Sales are invoiced in a currency other than United States Dollars, such amounts shall be converted to United States Dollars at the average daily exchange rate published by the European Central Bank for the applicable Calendar Quarter.
Section 3.3 — Tax Treatment. The Parties agree and acknowledge that the Lump-Sum Payment constitutes consideration for the settlement and release of all claims in the Action and for the grant of the Patent License Agreement and the Covenant Not to Sue, and that the Running Royalty constitutes license royalties for the use of intellectual property rights. Each Party shall be solely responsible for the payment of all taxes, duties, assessments, and other governmental charges imposed on it in connection with the payments made or received under this Agreement. Solstice shall comply with all applicable withholding tax obligations under United States federal, state, and local tax law and under the laws of Ireland, including any applicable provisions of the Convention between the Government of the United States of America and the Government of Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital Gains (the "U.S.-Ireland Tax Treaty"). Apex shall reasonably cooperate with Solstice's requests for tax documentation, including the execution and delivery of IRS Form W-9 or such other forms as may be reasonably required to establish Apex's tax status and to enable Solstice to comply with its withholding obligations. In the event that any withholding is required, Solstice shall remit the withheld amounts to the appropriate governmental authority, provide Apex with documentation of such withholding, and the net amount received by Apex after such withholding shall be deemed to satisfy Solstice's payment obligation with respect to the amount so withheld.
Section 3.4 — No Coverage by Insurance. The Parties acknowledge and agree that the Lump-Sum Payment, the Running Royalty, and all other payment obligations of Solstice under this Article III are not covered by, and Solstice does not expect to receive reimbursement from, any insurance policy maintained by Solstice or any of its Affiliates, including but not limited to intellectual property insurance Policy No. HSI-IP-2023-04891 issued by Halcyon Specialty Insurance Co. or any other insurance policy. Solstice's obligation to make all payments under this Article III is absolute and unconditional and shall not be contingent upon, reduced by, or subject to any right of set-off, counterclaim, or deduction related to insurance coverage, insurance reimbursement, or any dispute between Solstice and any insurer.
ARTICLE IV — LICENSE AND COVENANT NOT TO SUE
Section 4.1 — Patent License Grant. Subject to the terms and conditions of this Agreement and the Patent License Agreement attached hereto as Exhibit A, Apex hereby grants to Solstice a non-exclusive, non-transferable (except as expressly provided in Section 4.3), worldwide, royalty-bearing license under the Licensed Patents to make, have made, use, import, offer for sale, and sell Licensed Products in the Licensed Field. The license granted under this Section 4.1 shall be effective as of the Effective Date and shall remain in effect for the remaining life of each Licensed Patent, such that the license with respect to any individual Licensed Patent shall expire upon the expiration of that Licensed Patent (i.e., the license under the '237 Patent shall expire on June 22, 2035; the license under the '884 Patent shall expire on September 15, 2036; and the license under the '105 Patent shall expire on January 10, 2038). The license is royalty-bearing, with royalties payable as set forth in Section 3.2 of this Agreement.
Solstice shall have the right to grant sublicenses under the Licensed Patents solely to contract manufacturers engaged by Solstice for the manufacture of Licensed Products, provided that each such sublicense is set forth in a written agreement between Solstice and the sublicensee that contains terms and conditions no less protective of Apex's rights than those set forth in this Agreement and the Patent License Agreement, including without limitation obligations relating to confidentiality, record-keeping, and audit rights. Solstice shall provide Apex with written notice of any sublicense granted pursuant to this paragraph within thirty (30) days of its execution, together with a copy of the sublicense agreement (which may be redacted to remove pricing and other competitively sensitive information unrelated to Apex's rights). Solstice shall remain fully responsible for the acts and omissions of its sublicensees as if such acts and omissions were those of Solstice.
Section 4.2 — Covenant Not to Sue. As more fully set forth in the Covenant Not to Sue attached hereto as Exhibit B, Apex hereby irrevocably covenants and agrees that, during the term of the Patent License Agreement (as set forth in Section 4.1 and the Patent License Agreement), Apex will not assert, and will not authorize, direct, encourage, or assist any third party to assert, any patent or patent application in the Apex Trocar Patent Family (comprising the fourteen (14) issued United States patents and six (6) pending continuation applications listed on Exhibit C attached hereto) against Solstice, any Affiliate of Solstice, or any authorized sublicensee of Solstice, for or on account of the manufacture, having made, use, importation, offer for sale, or sale of any product within the Licensed Field. The Covenant Not to Sue extends to and encompasses all patents and patent applications in the Apex Trocar Patent Family, including any and all continuations, continuations-in-part, divisionals, reissues, and reexamination certificates thereof. The Covenant Not to Sue shall not extend to any patent or patent application outside the Apex Trocar Patent Family, and shall not limit Apex's right to assert patents against Solstice for activities outside the Licensed Field.
Section 4.3 — Transferability; Change of Control. The patent license granted in Section 4.1 and the Covenant Not to Sue granted in Section 4.2 are personal to Solstice and are non-transferable, except as expressly provided in this Section 4.3. In the event of a Change of Control of Solstice Parent or Solstice US, the patent license and Covenant Not to Sue shall automatically transfer to and be binding upon the successor entity, provided that such successor entity executes a written instrument reasonably satisfactory to Apex confirming the successor entity's agreement to be bound by all terms and conditions of this Agreement, including without limitation the payment obligations under Article III, the confidentiality obligations under Article IX, and the audit rights under Article VI. Solstice shall provide Apex with written notice of any Change of Control within thirty (30) days of the closing of the transaction giving rise to such Change of Control, which notice shall identify the successor entity and include a copy of the written instrument described in the preceding sentence. For the avoidance of doubt, the patent license and Covenant Not to Sue shall not extend to any products of the successor entity's pre-existing product lines that are not Licensed Products.
Section 4.4 — No Implied License. Except as expressly set forth in this Agreement, the Patent License Agreement, and the Covenant Not to Sue, nothing in this Agreement or in the performance or implementation hereof shall be construed to grant to Solstice, by implication, estoppel, or otherwise, any license or right under any patent, patent application, trade secret, trademark, copyright, or other intellectual property right owned, controlled, or licensable by Apex. Without limiting the foregoing, the license granted herein does not extend to any field of use other than the Licensed Field, and does not extend to any patent or intellectual property right other than the Licensed Patents and the Apex Trocar Patent Family as expressly provided herein.
ARTICLE V — MOST-FAVORED LICENSEE
Section 5.1 — Most-Favored Licensee Obligation. If, at any time during the term of this Agreement following the Effective Date, Apex enters into a license agreement or other arrangement with any third party with respect to any one or more of the Licensed Patents that provides for a running royalty rate (whether expressed as a percentage of net sales or an equivalent per-unit royalty) that is lower than three and three-quarters percent (3.75%) of Net Sales (any such agreement, a "Lower Rate License"), Apex shall provide written notice to Solstice of such Lower Rate License within thirty (30) days of the execution thereof. Upon delivery of such notice, the Running Royalty rate applicable to Solstice under Section 3.2 of this Agreement shall automatically adjust downward to the lower running royalty rate set forth in the Lower Rate License, effective prospectively as of the first day of the Calendar Quarter following Apex's delivery of such notice to Solstice. For the avoidance of doubt, the most-favored licensee adjustment shall apply only to reductions in the running royalty rate and shall not require any retroactive adjustment or refund of royalties previously paid by Solstice at the 3.75% rate.
Section 5.2 — Notification Protocol. The notification obligations set forth in this Article V are further described in the Side Letter of even date herewith between Solstice and Apex. Apex's notification under Section 5.1 shall include a written notice specifying: (i) the effective date of the Lower Rate License; and (ii) the applicable running royalty rate under the Lower Rate License. Apex shall not be required to disclose the identity of the third-party licensee under the Lower Rate License, unless such disclosure is required by applicable law, regulation, or court order. Upon Solstice's reasonable request, Apex shall provide to Solstice a certification from Apex's outside independent auditors (currently Creston Perry LLP, Certified Public Accountants, Wilmington, Delaware) or from Apex's outside legal counsel, confirming: (a) that a Lower Rate License has been executed; (b) the effective date of such Lower Rate License; and (c) the applicable running royalty rate thereunder. The cost of any such certification shall be borne by Solstice.
Section 5.3 — Disputes. Any dispute arising under or relating to this Article V, including any dispute regarding the applicability of the most-favored licensee adjustment, the comparability of royalty structures, or the calculation of the adjusted royalty rate, shall be resolved in accordance with the dispute resolution procedures set forth in Article XII of this Agreement.
ARTICLE VI — AUDIT RIGHTS
Section 6.1 — Audit Right. Apex shall have the right, exercisable no more than once during any calendar year, to engage an independent certified public accounting firm of nationally recognized standing, reasonably acceptable to Solstice (such acceptance not to be unreasonably withheld, conditioned, or delayed), to examine and audit those books, records, accounts, and supporting documentation of Solstice and its Affiliates as are reasonably necessary to verify the completeness and accuracy of the royalty reports and Running Royalty payments made by Solstice under Section 3.2 of this Agreement. Any such audit shall be conducted: (i) during Solstice's normal business hours at its principal offices or such other location where the relevant records are maintained; (ii) upon not less than thirty (30) days' prior written notice from Apex to Solstice specifying the proposed dates of the audit and the identity of the auditing firm; and (iii) in a manner that minimizes disruption to Solstice's normal business operations. The scope of any audit conducted pursuant to this Section 6.1 shall be limited to the verification of Net Sales, the deductions applied in calculating Net Sales, and the resulting Running Royalty calculations, and shall cover a period not to exceed the three (3) calendar years immediately preceding the date of Apex's written audit notice.
Section 6.2 — Cost of Audit. The cost of any audit conducted pursuant to Section 6.1, including the fees and expenses of the independent auditing firm, shall be borne solely by Apex; provided, however, that if such audit reveals an underpayment of Running Royalties by Solstice exceeding five percent (5%) of the aggregate amount of Running Royalties that were due and payable for any audited period (as determined on an annualized basis), then Solstice shall bear and promptly reimburse Apex for the reasonable cost of such audit, including all fees and expenses of the auditing firm.
Section 6.3 — Underpayment / Overpayment. In the event that an audit conducted pursuant to Section 6.1 reveals an underpayment of Running Royalties by Solstice, Solstice shall pay to Apex the full amount of such underpayment within thirty (30) days of written notice from Apex setting forth the audit findings and the amount of the underpayment, together with interest on such underpaid amount calculated at the rate set forth in Section 3.1(c) from the date such payment was originally due until the date of actual payment. In the event that an audit reveals an overpayment of Running Royalties by Solstice, such overpayment shall, at Solstice's sole election, be either (x) credited against future Running Royalty payments due from Solstice to Apex under Section 3.2, or (y) refunded by Apex to Solstice by wire transfer within thirty (30) days of written notice from Solstice electing a refund.
Section 6.4 — Confidentiality of Audit. Prior to commencing any audit under this Article VI, the independent auditing firm engaged by Apex shall execute a confidentiality agreement, in form and substance reasonably acceptable to Solstice, limiting the disclosure of any information obtained during the audit to the following: (a) the fact and amount of any underpayment or overpayment of Running Royalties; and (b) a summary of the auditing firm's findings and conclusions necessary to support any claim of underpayment or overpayment. The auditing firm shall not disclose to Apex or to any other person or entity any detailed financial information, customer lists, pricing data, sales volumes by customer, or other competitively sensitive business information of Solstice obtained during the audit, except to the extent such information is strictly necessary to calculate and report the amount of any underpayment or overpayment. Solstice shall have the right to review and approve any audit report before it is delivered to Apex, solely for the purpose of verifying compliance with the confidentiality restrictions set forth in this Section 6.4.
ARTICLE VII — MUTUAL RELEASE
Section 7.1 — Solstice's Release of Apex. Effective as of the Effective Date, Solstice (including both Solstice Parent and Solstice US), on behalf of itself and each of its Affiliates, and each of their respective officers, directors, employees, agents, representatives, predecessors, successors, heirs, executors, administrators, and assigns (collectively, the "Solstice Releasing Parties"), hereby irrevocably and unconditionally releases, acquits, and forever discharges Apex and each of its Affiliates, and each of their respective officers, directors (including without limitation Gerald K. Whitford, Dr. Priya Chandrasekaran, Martin Hale, and Dr. Raymond Szabo), employees, agents, representatives, predecessors, successors, heirs, executors, administrators, assigns, insurers, and outside counsel (including without limitation Hargrove, Tate & Bennington LLP and each of its partners, associates, and employees) (collectively, the "Apex Released Parties"), from any and all claims, counterclaims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, covenants, contracts, controversies, agreements, promises, damages, judgments, executions, obligations, and liabilities of every kind and nature whatsoever, whether at law or in equity, whether known or unknown, suspected or unsuspected, foreseen or unforeseen, matured or unmatured, contingent or non-contingent, that the Solstice Releasing Parties have, have had, or may have against any of the Apex Released Parties, arising out of, relating to, or in connection with the Asserted Patents, the Accused Products, or the Action, from the beginning of time through and including the Effective Date. Without limiting the generality of the foregoing, the release set forth in this Section 7.1 specifically includes and encompasses: (i) all counterclaims for declaratory judgment of non-infringement of the Asserted Patents; (ii) all counterclaims for declaratory judgment of invalidity of the Asserted Patents; (iii) all affirmative defenses and counterclaims based on inequitable conduct; and (iv) all claims for attorneys' fees, costs, and expenses incurred in connection with the Action.
Section 7.2 — Apex's Release of Solstice. Effective as of the Effective Date, Apex, on behalf of itself and each of its Affiliates, and each of their respective officers, directors, employees, agents, representatives, predecessors, successors, heirs, executors, administrators, and assigns (collectively, the "Apex Releasing Parties"), hereby irrevocably and unconditionally releases, acquits, and forever discharges Solstice (including both Solstice Parent and Solstice US) and each of its Affiliates, and each of their respective officers, directors (including without limitation Dr. Fiona Tierney, Eamon Rourke, Niamh Cassidy, and Brendan Molloy), employees, agents, representatives, predecessors, successors, heirs, executors, administrators, assigns, insurers, and outside counsel (including without limitation Calderwood & Harkness LLP and each of its partners, associates, and employees) (collectively, the "Solstice Released Parties"), from any and all claims, counterclaims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, covenants, contracts, controversies, agreements, promises, damages, judgments, executions, obligations, and liabilities of every kind and nature whatsoever, whether at law or in equity, whether known or unknown, suspected or unsuspected, foreseen or unforeseen, matured or unmatured, contingent or non-contingent, that the Apex Releasing Parties have, have had, or may have against any of the Solstice Released Parties, arising out of, relating to, or in connection with the Asserted Patents, the Accused Products, the Apex Trocar Patent Family (to the extent arising from acts occurring prior to the Effective Date), or the Action, from the beginning of time through and including the Effective Date. Without limiting the generality of the foregoing, the release set forth in this Section 7.2 specifically includes and encompasses all claims for patent infringement (direct, contributory, and induced), willful patent infringement, and enhanced damages, as well as all claims for attorneys' fees, costs, and expenses incurred in connection with the Action.
Section 7.3 — Scope of Release. The releases set forth in Sections 7.1 and 7.2 include, without limitation, all claims and causes of action for patent infringement (whether direct, literal, or under the doctrine of equivalents), contributory infringement, inducement of infringement, willful infringement, and all defenses, affirmative defenses, and counterclaims that were asserted or could have been asserted by any Party in the Action. The Parties acknowledge that the scope of the releases is intended to be as broad as possible and to encompass all disputes between the Parties relating to the Asserted Patents, the Accused Products, and the Action. Notwithstanding the foregoing, the releases set forth in this Article VII shall not extend to, and shall not release any Party from, any obligation, liability, or claim arising under or pursuant to this Agreement, the Patent License Agreement, the Covenant Not to Sue, the Escrow Agreement, or any other ancillary document executed in connection herewith.
Section 7.4 — Waiver of Unknown Claims. Each Party acknowledges that it may discover facts, claims, or defenses in addition to or different from those that it now knows or believes to exist with respect to the subject matter of the releases set forth in this Article VII, and that the existence of such additional or different facts, claims, or defenses may materially affect the claims and defenses released hereby. Each Party hereby expressly, knowingly, voluntarily, and intentionally waives and relinquishes any and all rights and benefits that it may have under any statute, regulation, common law principle, or rule of equity that would otherwise limit the release set forth herein to those claims, demands, and causes of action that are known or suspected to exist at the time of execution of this Agreement, including without limitation any rights under California Civil Code Section 1542 (to the extent applicable) or any similar provision of the laws of any other jurisdiction. Each Party acknowledges that this waiver is an essential and material term of this Agreement and that, without such waiver, this Agreement would not have been entered into.
ARTICLE VIII — DISMISSAL OF THE ACTION
Section 8.1 — Stipulation of Dismissal. Within fifteen (15) days following the Effective Date (and in any event on or before July 1, 2025), the Parties shall cause their respective outside litigation counsel — Calderwood & Harkness LLP (on behalf of Solstice US) and Hargrove, Tate & Bennington LLP (on behalf of Apex) — to execute and file the Stipulation of Dismissal with Prejudice in substantially the form attached hereto as Exhibit E with the Clerk of the United States District Court for the District of Delaware in the Action (Case No. 1:24-cv-00587-RGA). Each Party shall instruct its counsel to cooperate fully and to take all actions reasonably necessary to effect the filing of the Stipulation of Dismissal within the time period specified herein.
Section 8.2 — Terms of Dismissal. The Stipulation of Dismissal shall provide for the dismissal with prejudice of all claims and counterclaims asserted in the Action, including Apex's claims for patent infringement and Solstice US's counterclaims for declaratory judgment of non-infringement and invalidity and its affirmative defense of inequitable conduct. Each Party shall bear its own costs, expenses, and attorneys' fees incurred in connection with the Action, and no Party shall seek or be entitled to any award of costs or attorneys' fees from the other Party in connection with the Action. The Stipulation of Dismissal shall further provide that the United States District Court for the District of Delaware shall retain jurisdiction solely for the purpose of enforcing the terms of this Agreement, as set forth in Article XII.
Section 8.3 — Vacatur of Trial Date. Promptly following the full execution of this Agreement (and in any event within five (5) business days of the Effective Date), the Parties shall jointly move the Court, or jointly request through a letter to Chief Judge Andrews' chambers, to vacate the September 30, 2025 trial date and all remaining case deadlines, pending the filing of the Stipulation of Dismissal. The Parties shall cooperate in good faith to prepare and file any submissions necessary to accomplish the vacatur of the trial date and related deadlines.
ARTICLE IX — CONFIDENTIALITY
Section 9.1 — Confidentiality Obligations. Each Party agrees that it shall maintain in strict confidence, and shall not disclose, disseminate, publish, or otherwise communicate to any third party, directly or indirectly, any Confidential Information, except as follows:
(a) Internal Disclosure. A Party may disclose Confidential Information to its own officers, directors, employees, accountants, financial advisors, and legal counsel who have a need to know such information in connection with the implementation, administration, or enforcement of this Agreement, provided that each such recipient is bound by obligations of confidentiality no less restrictive than those set forth in this Article IX. For purposes of this exception, Solstice's outside accountants are Glenmore & Byrne LLP, and Apex's outside accountants are Creston Perry LLP.
(b) Legal or Regulatory Compulsion. A Party may disclose Confidential Information to the extent required by applicable law, statute, regulation, court order, subpoena, civil investigative demand, or the rules or requirements of any governmental authority, regulatory body, or stock exchange having jurisdiction over such Party, provided that the disclosing Party shall (to the extent legally permissible) provide the other Party with prompt written notice of such requirement prior to disclosure, together with a copy of the order, subpoena, or other document requiring such disclosure, and shall cooperate with the other Party's reasonable efforts to obtain a protective order or other appropriate remedy to limit the scope or extent of such disclosure.
(c) Enforcement. A Party may disclose Confidential Information in connection with any proceeding to enforce the terms of this Agreement, the Patent License Agreement, the Escrow Agreement, or any other ancillary document executed in connection herewith.
(d) Change of Control. A Party may disclose Confidential Information to a bona fide potential acquirer of such Party (or substantially all of such Party's assets) in connection with due diligence for a potential Change of Control, provided that such potential acquirer has first executed a written confidentiality agreement with the disclosing Party containing terms no less protective of the Confidential Information than those set forth in this Article IX.
(e) Insurance Reporting. Solstice may disclose Confidential Information to Halcyon Specialty Insurance Co. (or its successor) to the extent reasonably necessary for Solstice's insurance reporting and coverage determination purposes, provided that Solstice shall use commercially reasonable efforts to limit the scope of any such disclosure and to ensure that Halcyon Specialty Insurance Co. maintains the confidentiality of the information so disclosed.
Section 9.2 — Joint Public Statement. The Parties agree that the only public statement to be made by or on behalf of either Party (or any Affiliate of either Party) regarding the settlement of the Action and the execution of this Agreement shall be the Agreed Joint Public Statement attached hereto as Exhibit F, which shall state that "the matter has been resolved on mutually agreeable terms." No Party shall issue any press release, public filing, blog post, social media communication, investor communication, or other public statement beyond the Agreed Joint Public Statement that discloses the existence, terms, or conditions of this Agreement (including the financial terms) without the prior written consent of the other Party, which consent may be withheld in such Party's sole discretion. Notwithstanding the foregoing, this Section 9.2 shall not prevent either Party from making such disclosures as may be required by applicable securities laws, stock exchange rules, or governmental authorities, subject to the notice and cooperation requirements of Section 9.1(b).
Section 9.3 — Injunctive Relief. Each Party acknowledges and agrees that any breach or threatened breach of the confidentiality obligations set forth in this Article IX would cause immediate and irreparable harm to the non-breaching Party, the extent of which would be difficult or impossible to quantify, and for which monetary damages would be an inadequate remedy. Accordingly, in addition to all other rights and remedies available at law or in equity, the non-breaching Party shall be entitled to seek temporary, preliminary, and permanent injunctive relief, specific performance, and other equitable relief to enforce the provisions of this Article IX, without the necessity of proving actual damages, posting any bond or other security, or meeting any similar requirement under applicable law.
ARTICLE X — TERM AND TERMINATION
Section 10.1 — Term. This Agreement shall become effective on the Effective Date and, unless earlier terminated in accordance with this Article X, shall continue in full force and effect until the expiration of the last to expire of the Licensed Patents (i.e., the '105 Patent, expiring January 10, 2038). Notwithstanding the foregoing or any other provision of this Agreement, the mutual releases set forth in Article VII and the dismissal provisions set forth in Article VIII are irrevocable and shall survive any termination or expiration of this Agreement. Upon expiration of the term, all licenses and covenants granted under this Agreement with respect to expired Licensed Patents shall have lapsed, and no further Running Royalty payments shall be due.
Section 10.2 — Termination for Material Breach. Either Party may terminate this Agreement (other than Article VII, Article VIII, and the other surviving provisions set forth in Section 10.3) upon written notice to the other Party if the other Party commits a material breach of any provision of this Agreement and fails to cure such breach within sixty (60) days after receipt of written notice from the non-breaching Party specifying the nature of the breach in reasonable detail and demanding cure. Without limiting the generality of the foregoing, a failure by Solstice to make any payment of the Lump-Sum Payment or any Running Royalty payment when due under Article III, which failure continues uncured for sixty (60) days following receipt of written notice thereof, shall constitute a material breach of this Agreement. In the event of termination by Apex due to Solstice's failure to make any payment under Article III, the Patent License Agreement and the Covenant Not to Sue shall immediately and automatically terminate, and all rights of Apex under the Asserted Patents and the Apex Trocar Patent Family shall be fully restored as if the Patent License Agreement and Covenant Not to Sue had not been granted, without prejudice to Apex's right to recover any unpaid amounts (including accrued interest under Section 3.1(c)) and any other damages to which Apex may be entitled at law or in equity.
Section 10.3 — Survival. The following provisions of this Agreement shall survive the expiration or termination of this Agreement for any reason and shall remain in full force and effect: Article I (Definitions), Section 3.3 (Tax Treatment), Section 3.4 (No Coverage by Insurance), Sections 6.1 through 6.4 (Audit Rights), Article VII (Mutual Release), Article VIII (Dismissal of the Action), Art

SETTLEMENT AGREEMENT AND MUTUAL RELEASE

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