1037-00004 · Solstice Biomedical Devices Ltd · Settlement Documentation

side-letter-mfl-provision.docx DOCUMENT Litigation

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CALDERWOOD & HARKNESS LLP 1201 Market Street, Suite 2500 Wilmington, DE 19801 Tel: (302) 884-7200	Fax: (302) 884-7201
Main Office: 299 Park Avenue, 35th Floor New York, NY 10171 Tel: (212) 506-5000	Fax: (212) 506-5001

June 16, 2025

SIDE LETTER AGREEMENT

RE: MOST-FAVORED LICENSEE PROVISION — NOTIFICATION PROTOCOL

Reference Documents:

This Side Letter Agreement (this "Side Letter") is entered into as of June 16, 2025, by and among the parties identified below, with reference to the following:

(i) The Settlement Agreement and Mutual Release dated as of June 16, 2025 (the "Settlement Agreement"), by and among Solstice Biomedical Devices Ltd., Solstice Biomedical, Inc., and Apex Surgical Innovations, Inc., resolving all claims, counterclaims, and defenses in Apex Surgical Innovations, Inc. v. Solstice Biomedical Devices Ltd. et al., Case No. 1:24-cv-00587-RGA, pending before the United States District Court for the District of Delaware (the "Litigation");

(ii) The Patent License Agreement (Non-Exclusive) attached as Exhibit A to the Settlement Agreement (the "License Agreement"); and

(iii) The underlying Litigation, Case No. 1:24-cv-00587-RGA, before the Honorable Richard G. Andrews, United States District Judge for the District of Delaware.

PARTIES:

Apex Surgical Innovations, Inc. ("Apex"), a corporation organized and existing under the laws of the State of Delaware, with its principal office located at 1220 North Market Street, Suite 550, Wilmington, Delaware 19801, EIN: 51-0483762, acting through its duly authorized signatory, Martin Hale, General Counsel;

Solstice Biomedical Devices Ltd. ("Solstice"), a private limited company organized 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, acting through its duly authorized signatory, Eamon Rourke, General Counsel; and

Solstice Biomedical, Inc. ("Solstice US"), 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, acting through its duly authorized signatory, Brendan Molloy, Chief Financial Officer.

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

RECITALS

WHEREAS, Apex and the Solstice Parties have entered into the Settlement Agreement dated as of June 16, 2025, pursuant to which the Parties have agreed to resolve all claims, counterclaims, and defenses asserted or that could have been asserted in the Litigation, Case No. 1:24-cv-00587-RGA, pending before the United States District Court for the District of Delaware;

WHEREAS, contemporaneously with the execution of the Settlement Agreement, Apex and the Solstice Parties have entered into the License Agreement, which is attached as Exhibit A to the Settlement Agreement, pursuant to which Apex has granted to Solstice and Solstice US a non-exclusive license under the Licensed Patents (as defined below) in the Field of Use (as defined below);

WHEREAS, Section 4.6 of the Settlement Agreement and Section 5.3 of the License Agreement provide that Solstice shall be entitled to most-favored licensee ("MFL") treatment with respect to the running royalty rate applicable to the Licensed Patents, which include United States Patent No. 9,814,237 (entitled "Surgical Trocar Assembly with Multi-Seal Valve Mechanism"), United States Patent No. 10,271,884 (entitled "Laparoscopic Access Device with Radial Expansion Feature"), and United States Patent No. 10,932,105 (entitled "Integrated Trocar-Cannula System with Insufflation Control"), together with any continuations, divisionals, or reissues thereof (collectively, the "Licensed Patents");

WHEREAS, under the MFL provision, if Apex enters into a license agreement with any third party for any of the Licensed Patents at a running royalty rate lower than three and three-quarters percent (3.75%) of Net Sales (the "Current Rate"), Solstice's running royalty rate shall be adjusted prospectively to match such lower rate, subject to the terms and conditions set forth in this Side Letter;

WHEREAS, the Parties desire to establish a detailed notification protocol to govern the administration and implementation of the MFL provision, including the manner, timing, and content of required notifications, the methodology for calculating effective running royalty rates in cases involving blended consideration, the mechanics of rate adjustments, and the procedures for verification and dispute resolution; and

WHEREAS, capitalized terms used but not defined herein shall have the meanings ascribed to them in the Settlement Agreement and the License Agreement, as applicable.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

SECTION 1: DEFINITIONS

For purposes of this Side Letter, the following terms shall have the meanings set forth below. All other capitalized terms used but not defined in this Side Letter shall have the meanings ascribed to them in the Settlement Agreement or the License Agreement, as applicable.

1.1 "Current Rate" means three and three-quarters percent (3.75%) of Net Sales, as established in Section 5.1 of the License Agreement and as may be adjusted from time to time in accordance with the MFL provision and this Side Letter.

1.2 "Licensed Patents" means United States Patent No. 9,814,237 (issued November 14, 2017), United States Patent No. 10,271,884 (issued April 30, 2019), and United States Patent No. 10,932,105 (issued March 2, 2021), together with any and all continuations, divisionals, continuations-in-part, reissues, and reexamination certificates thereof, as further enumerated in Exhibit C to the Settlement Agreement, which identifies fourteen (14) issued United States patents and six (6) pending continuation applications in the Apex Trocar Patent Family.

1.3 "Licensed Products" means the PrecisionEdge™ PE-5000 series, the PrecisionEdge™ PE-12000 series, and the PrecisionEdge™ PE-15000 series laparoscopic surgical access devices, together with any successor products thereto, all as defined in Section 1.12 of the License Agreement.

1.4 "MFL Triggering License" means any license agreement, settlement agreement, covenant not to sue, release, forbearance agreement, or other arrangement or understanding (whether written or oral, and regardless of how denominated) entered into by Apex, or by any successor, assign, parent, subsidiary, or affiliate of Apex, with any Third-Party Licensee that (a) grants rights, immunities, or covenants under one or more of the Licensed Patents, and (b) includes a running royalty rate, or an effective running royalty rate as calculated under Section 3 of this Side Letter, that is lower than the Current Rate or the then-applicable adjusted rate, as the case may be. For the avoidance of doubt, the term "MFL Triggering License" shall include any amendment, modification, restatement, or supplement to an existing third-party license that results in a reduction of the effective running royalty rate below the Current Rate or the then-applicable adjusted rate.

1.5 "Net Sales" shall have the meaning ascribed to that term in Section 1.15 of the License Agreement, which defines Net Sales as the gross invoiced sales price of Licensed Products sold by or on behalf of Solstice or Solstice US to unaffiliated third parties in bona fide arm's-length transactions, less the following deductions to the extent actually incurred and separately stated on the applicable invoice or otherwise documented: (a) trade discounts, quantity discounts, and cash discounts actually allowed and taken; (b) credits, allowances, and refunds for returns, replacements, and rejections; (c) chargebacks, rebates, and retroactive price adjustments; (d) freight, shipping, insurance, and handling charges to the extent separately stated and prepaid or allowed; and (e) sales, use, value-added, and other similar taxes, tariffs, and duties imposed on the sale and included in the gross invoiced price.

1.6 "Third-Party Licensee" means any person, entity, corporation, partnership, limited liability company, joint venture, or other legal entity other than Solstice, Solstice US, or any subsidiary of Solstice or Solstice US, that is granted a license, covenant not to sue, release, or other right or immunity under one or more of the Licensed Patents by Apex or any successor or assignee of Apex.

1.7 "Royalty Floor" means Five Hundred Thousand Dollars ($500,000) per calendar year, beginning with calendar year 2026, as established in Section 5.2(a) of the License Agreement.

1.8 "Royalty Cap" means One Million Eight Hundred Thousand Dollars ($1,800,000) per calendar year, as established in Section 5.2(b) of the License Agreement.

1.9 "Field of Use" means laparoscopic surgical access devices, as defined in Section 1.8 of the License Agreement.

1.10 "Adjustment Date" shall have the meaning ascribed to that term in Section 4.1 of this Side Letter.

1.11 "MFL Compliance Certificate" shall have the meaning ascribed to that term in Section 6.1 of this Side Letter.

1.12 "MFL Notice" shall have the meaning ascribed to that term in Section 2.2 of this Side Letter.

SECTION 2: NOTIFICATION OBLIGATION

2.1 Triggering Event. Apex shall be obligated to provide written notice to the Solstice Parties within thirty (30) calendar days after the execution (or, if later, the effective date) of any MFL Triggering License. This notification obligation is absolute and unconditional, and shall apply irrespective of whether the MFL Triggering License covers all of the Licensed Patents or only a subset thereof, irrespective of whether the MFL Triggering License covers the same Field of Use as the License Agreement or a broader, narrower, or different field, and irrespective of the identity, size, or geographic location of the Third-Party Licensee. For purposes of this Section 2.1, "execution" shall mean the date on which the last Party to sign the MFL Triggering License executes such agreement, or, in the case of an oral arrangement, the date on which the Parties to such arrangement reach a binding agreement.

2.2 Content of Notice. The written notice required under Section 2.1 (the "MFL Notice") shall include the following information:

(a) Date of Execution. The date of execution (or effectiveness) of the MFL Triggering License.

(b) Identity of Third-Party Licensee. The identity of the Third-Party Licensee; provided, however, that if Apex is prohibited from disclosing the specific name of the Third-Party Licensee by a bona fide, pre-existing confidentiality obligation contained in the MFL Triggering License or in a separate confidentiality agreement between Apex and the Third-Party Licensee, Apex may redact the specific name of the Third-Party Licensee from the MFL Notice, but must identify the licensee by a reasonable description that is sufficient to enable Solstice to assess the comparability of the MFL Triggering License, including, at a minimum, the Third-Party Licensee's industry sector, its approximate annual revenue (expressed as a range, e.g., "$100M–$500M"), and the principal geographic markets in which it operates.

(c) Covered Licensed Patents. A specific identification of each Licensed Patent covered by the MFL Triggering License, including United States patent numbers and, where applicable, the filing dates and expected expiration dates of any pending continuation applications included in the MFL Triggering License.

(d) Running Royalty Rate. The running royalty rate (or, where applicable, the effective running royalty rate calculated in accordance with Section 3 of this Side Letter) applicable under the MFL Triggering License, expressed as a percentage of net sales (or the equivalent measure used in the MFL Triggering License).

(e) Field of Use. The field of use, if any, applicable to the MFL Triggering License, together with a description of any restrictions or limitations on the scope of the license grant.

(f) Non-Royalty Consideration. A statement of whether the MFL Triggering License includes any lump-sum payment, upfront fee, milestone payment, cross-license grant, equity consideration, or other non-royalty consideration, together with a reasonably detailed explanation of how Apex calculated the effective running royalty rate in accordance with Section 3 of this Side Letter, including the key assumptions and data inputs used in such calculation.

(g) Effective Date. The effective date of the lower royalty rate under the MFL Triggering License, and, if different, the date as of which the MFL Triggering License became binding on the parties thereto.

2.3 Form of Notice. All MFL Notices required or permitted under this Side Letter shall be in writing and shall be delivered in accordance with the notice provisions set forth in Section 12.4 of the Settlement Agreement, as supplemented by this Section 2.3.

(a) Notices to Solstice. MFL Notices and all other notices to the Solstice Parties under this Side Letter shall be addressed as follows:

Eamon Rourke, General Counsel Solstice Biomedical Devices Ltd. Unit 14, Clonskeagh Business Park Clonskeagh Road Dublin 14, D14 YF28, Ireland

Email: e.rourke@solsticebiomedical.ie

With a copy (which shall not constitute notice) to:

Marcus Delgado, Esq. Calderwood & Harkness LLP 1201 Market Street, Suite 2500 Wilmington, DE 19801

Email: mdelgado@calderwoodharkness.com

(b) Notices to Apex. MFL Notices and all other notices to Apex under this Side Letter shall be addressed as follows:

Martin Hale, General Counsel Apex Surgical Innovations, Inc. 1220 North Market Street, Suite 550 Wilmington, DE 19801

Email: m.hale@apexsurgical.com

With a copy (which shall not constitute notice) to:

Victoria Stanton, Esq. Hargrove, Tate & Bennington LLP 900 North King Street, Suite 1200 Wilmington, DE 19801

Email: vstanton@htblaw.com

(c) Delivery Methods. All notices under this Side Letter shall be delivered by (i) personal delivery, (ii) a nationally recognized overnight courier service (such as Severin Partners LLC, Halcyon Partners LLC, or Tarrant & Co.), or (iii) email, provided that any notice delivered by email must be accompanied by a confirmation of receipt from the recipient (by reply email, read receipt, or other reasonable means of confirmation). Notices shall be deemed effective upon actual receipt by the addressee. Either Party may change its notice address by providing written notice of the change to the other Parties in accordance with this Section 2.3.

SECTION 3: CALCULATION OF EFFECTIVE RUNNING ROYALTY RATE

3.1 Pure Running Royalty Licenses. Where an MFL Triggering License provides solely for a running royalty, without any lump-sum payment, upfront fee, milestone payment, cross-license grant, equity consideration, or other non-royalty consideration, the stated running royalty rate in the MFL Triggering License shall be the effective running royalty rate for purposes of comparison with the Current Rate (or the then-applicable adjusted rate) under the MFL provision. No further calculation or adjustment shall be required.

3.2 Blended Consideration Licenses. Where an MFL Triggering License includes any lump-sum payment, upfront fee, milestone payment, cross-license grant, equity consideration, or other non-royalty consideration, in addition to or in lieu of a running royalty, the effective running royalty rate shall not be determined solely by reference to the stated running royalty rate (if any) in the MFL Triggering License. Instead, Apex shall calculate an "effective running royalty rate" by amortizing all non-royalty consideration over the expected remaining term of the Licensed Patents covered by the MFL Triggering License and the expected sales volume of the Third-Party Licensee's licensed products during such remaining term, using reasonable, good-faith assumptions that are consistent with industry practice and supportable by reference to publicly available data or internal business projections.

(a) Methodology Disclosure. The methodology used by Apex to calculate the effective running royalty rate under this Section 3.2 shall be disclosed to Solstice in the MFL Notice in reasonable detail, including, at a minimum: (i) the total amount of all non-royalty consideration; (ii) the remaining term of the Licensed Patents over which such consideration is amortized; (iii) the projected annual sales volume (in units or dollars) of the Third-Party Licensee's licensed products; (iv) the basis for such sales projections; and (v) the resulting effective running royalty rate, expressed as a percentage.

(b) Fully Paid-Up Licenses. If the MFL Triggering License is a fully paid-up license with no running royalty component, Apex shall calculate an effective running royalty rate by dividing the total consideration paid or payable under the MFL Triggering License by the product of (x) the projected annual Net Sales of the Third-Party Licensee's licensed products (using the same definition of Net Sales as set forth in the License Agreement, or a substantially equivalent measure), multiplied by (y) the remaining weighted-average term of the Licensed Patents covered by the MFL Triggering License, measured from the effective date of such license to the expiration date of the last-to-expire Licensed Patent covered thereby.

(c) Milestone Payments. Where the non-royalty consideration includes milestone payments that are contingent upon the achievement of specified technical, regulatory, or commercial milestones, Apex shall include in the calculation only those milestone payments that have been earned and paid, or that are reasonably likely to be earned based on the Third-Party Licensee's development stage and commercialization timeline, applying a probability-weighted approach consistent with industry practice.

3.3 Cross-License Adjustments. Where an MFL Triggering License involves a cross-license, meaning that the Third-Party Licensee grants to Apex a license under one or more patents or other intellectual property rights owned or controlled by the Third-Party Licensee, the value of such patents or other intellectual property granted by the Third-Party Licensee to Apex shall be excluded from the calculation of the effective running royalty rate under this Section 3. The rationale for this exclusion is that a cross-license grant represents value flowing from the Third-Party Licensee to Apex, not consideration paid by the Third-Party Licensee for rights under the Licensed Patents, and its inclusion would artificially inflate the effective royalty rate.

Notwithstanding the foregoing, if the cross-license grant from the Third-Party Licensee to Apex is nominal, pretextual, or otherwise lacks genuine economic substance — for example, because the patents licensed back to Apex are expired, invalid, or unenforceable, or because the cross-license grant does not cover any products that Apex manufactures, sells, or plans to manufacture or sell — the cross-license grant shall be disregarded in its entirety, and the total consideration under the MFL Triggering License shall be treated as if the cross-license component did not exist.

3.4 Disputes Regarding Effective Rate Calculation. If Solstice disputes Apex's calculation of the effective running royalty rate under this Section 3, including any dispute regarding the reasonableness of the assumptions used, the appropriateness of the methodology applied, or the accuracy of the data inputs employed, such dispute shall be resolved in accordance with the dispute resolution mechanism set forth in Section 7 of this Side Letter. Pending resolution of any such dispute, Solstice's running royalty rate shall remain at the Current Rate (or the then-applicable adjusted rate), and Solstice shall continue to make royalty payments at such rate; provided, however, that if the dispute is ultimately resolved in Solstice's favor, the rate adjustment shall be applied retroactively to the Adjustment Date that would have applied had the dispute not arisen, and Apex shall refund to Solstice any overpayment of royalties, together with interest at the rate specified in Section 5.4 of the License Agreement.

SECTION 4: RATE ADJUSTMENT MECHANICS

4.1 Prospective Adjustment. Upon delivery of a valid MFL Notice disclosing an effective running royalty rate that is lower than the Current Rate (or the then-applicable adjusted rate, as the case may be), Solstice's running royalty rate under the License Agreement shall be automatically adjusted, without the need for any amendment to the License Agreement, to match the lower effective running royalty rate disclosed in the MFL Notice. Such adjustment shall take effect as of the first day of the calendar quarter immediately following the date on which Solstice receives the MFL Notice (the "Adjustment Date"). By way of example, if Solstice receives an MFL Notice on August 15 of a given year, the Adjustment Date would be October 1 of that year.

For the avoidance of doubt, the adjustment contemplated by this Section 4.1 is prospective only. No retroactive credit, refund, or offset shall be due to Solstice for royalty payments properly made at the Current Rate (or the then-applicable adjusted rate) for any period prior to the Adjustment Date, except as otherwise provided in Section 3.4 or Section 6.2 of this Side Letter.

4.2 Adjustment to Floor and Cap. The Royalty Floor of Five Hundred Thousand Dollars ($500,000) per calendar year and the Royalty Cap of One Million Eight Hundred Thousand Dollars ($1,800,000) per calendar year, each as established in the License Agreement, shall remain unchanged and in full force and effect notwithstanding any adjustment to the running royalty rate made pursuant to this Side Letter. The Parties acknowledge that the Royalty Floor and the Royalty Cap were negotiated as independent economic terms of the License Agreement and are not intended to be mechanically linked to the running royalty rate. Notwithstanding the foregoing, if the Parties mutually agree in writing to adjust the Royalty Floor or the Royalty Cap in connection with any adjustment to the running royalty rate, such agreement shall be documented in a separate written amendment to the License Agreement or this Side Letter, duly executed by authorized representatives of each Party.

4.3 Successive Adjustments. The MFL obligation set forth in this Side Letter is ongoing and shall remain in effect for the entire term of the License Agreement. If, following an initial adjustment of Solstice's running royalty rate pursuant to Section 4.1, Apex enters into one or more subsequent MFL Triggering Licenses at running royalty rates (or effective running royalty rates) that are successively lower than the then-applicable adjusted rate, each such event shall trigger a further prospective adjustment of Solstice's running royalty rate in accordance with the procedures set forth in this Section 4. There is no limit on the number of successive adjustments that may occur during the term of the License Agreement, subject in all cases to the Royalty Floor.

4.4 No Upward Adjustment. For the avoidance of doubt, the MFL provision is a one-way ratchet. If Apex enters into a license agreement with a Third-Party Licensee at a running royalty rate (or effective running royalty rate) that is equal to or higher than the Current Rate (or the then-applicable adjusted rate), Solstice's running royalty rate shall not be adjusted upward. The MFL provision entitles Solstice to the benefit of any lower rate, but does not expose Solstice to the risk of any higher rate.

SECTION 5: CONFIDENTIALITY OF MFL NOTICES

5.1 Confidential Treatment. All MFL Notices delivered by Apex to the Solstice Parties pursuant to this Side Letter, and all information contained therein (including the identity of any Third-Party Licensee, the terms of any MFL Triggering License, the effective running royalty rate, and the methodology and assumptions used to calculate such rate), shall be treated as Confidential Information of Apex under and subject to the confidentiality provisions set forth in Section 11.1 of the Settlement Agreement. The Solstice Parties shall not disclose, publish, or otherwise disseminate the contents of any MFL Notice, or any portion thereof, to any person or entity other than:

(a) officers, directors, employees, and authorized agents of Solstice and Solstice US who have a need to know such information for the purpose of administering the License Agreement and the MFL provision, and who are bound by obligations of confidentiality no less restrictive than those set forth herein;

(b) Calderwood & Harkness LLP, Solstice's outside legal counsel, and any successor outside legal counsel retained by Solstice in connection with the License Agreement or this Side Letter;

(c) Glenmore & Byrne LLP, Solstice's independent auditors, or any successor independent auditing firm retained by Solstice, solely for the purpose of auditing Solstice's financial statements and royalty obligations; and

(d) any independent accounting firm engaged pursuant to Section 6.2 of this Side Letter for the purpose of verifying Apex's compliance with the MFL provision.

Each person or entity to whom Confidential Information is disclosed pursuant to this Section 5.1 shall be informed of the confidential nature of such information and shall be required to maintain such information in confidence in accordance with the terms of this Side Letter and the Settlement Agreement.

5.2 Apex's Confidentiality Obligations. Apex shall not disclose to any Third-Party Licensee, or to any other person or entity, the specific running royalty rate, the Royalty Floor, the Royalty Cap, or any other financial terms of Solstice's License Agreement, except to the extent such disclosure is required by applicable law, regulation, court order, or subpoena, in which case Apex shall provide Solstice with prompt written notice of such requirement (to the extent legally permissible) and shall cooperate with Solstice in seeking a protective order or other appropriate remedy to limit the scope of such disclosure. Apex further agrees that it shall not use the existence of the License Agreement or its terms as a benchmark or negotiating tool in discussions with any Third-Party Licensee without the prior written consent of Solstice.

SECTION 6: VERIFICATION AND AUDIT

6.1 Solstice's Verification Right — Annual Certification. No more than once per calendar year, Solstice may submit a written request to Apex for a certification regarding Apex's compliance with its obligations under the MFL provision and this Side Letter. Upon receipt of such request, Apex shall provide to Solstice a written certification (an "MFL Compliance Certificate"), signed by Apex's General Counsel or another officer of Apex with knowledge of the relevant facts, certifying one of the following:

(a) that no MFL Triggering License was entered into during the preceding calendar year; or

(b) that one or more MFL Triggering Licenses were entered into during the preceding calendar year, and that the required MFL Notices were timely delivered to Solstice in accordance with Section 2 of this Side Letter, together with a brief description of each such MFL Triggering License and the corresponding MFL Notice.

Apex shall provide the MFL Compliance Certificate within thirty (30) calendar days of the date on which Apex receives Solstice's written request therefor. The MFL Compliance Certificate shall be delivered in writing in accordance with Section 2.3 of this Side Letter.

6.2 Independent Verification. If Solstice has a reasonable, good-faith basis to believe that Apex has entered into an MFL Triggering License without delivering the required MFL Notice, or that Apex has materially misstated or omitted information in an MFL Notice or an MFL Compliance Certificate, Solstice may, upon not less than thirty (30) calendar days' prior written notice to Apex, engage an independent, nationally recognized accounting firm (the "Independent Auditor") to review Apex's license agreements with third parties solely for the purpose of confirming compliance with the MFL provision and this Side Letter.

(a) Selection of Independent Auditor. The Independent Auditor shall be mutually acceptable to both Parties. If the Parties are unable to agree on an Independent Auditor within fifteen (15) business days of Solstice's notice, either Party may request that Amberstone ADR Services (as identified in Section 7.2) appoint an independent, nationally recognized accounting firm to serve as the Independent Auditor.

(b) Scope of Review. The Independent Auditor's review shall be limited solely to determining (i) whether any MFL Triggering License exists that Apex has not disclosed to Solstice, and (ii) if so, the effective running royalty rate applicable thereunder. The Independent Auditor shall not have the right to review, copy, or disclose any other terms, conditions, or provisions of Apex's third-party license agreements, and shall execute a confidentiality agreement satisfactory to both Parties prior to commencing the review.

(c) Access and Cooperation. Apex shall provide the Independent Auditor with reasonable access to Apex's records and personnel as necessary to complete the review, subject to the confidentiality limitations set forth in Section 6.2(b) above. The review shall be conducted during normal business hours at Apex's offices, or at such other location as the Parties may agree.

(d) Report. The Independent Auditor shall issue a written report to both Parties (the "Verification Report") setting forth its findings, including (i) whether any undisclosed MFL Triggering License was identified, (ii) the effective running royalty rate thereunder, and (iii) the date of execution thereof. The Verification Report shall not include any other information regarding Apex's third-party license agreements.

(e) Cost Allocation. The costs and expenses of the Independent Auditor shall be borne by Solstice; provided, however, that if the Verification Report reveals that one or more MFL Triggering Licenses were entered into and Apex failed to deliver the required MFL Notices, then Apex shall bear the full costs and expenses of the Independent Auditor and shall reimburse Solstice for any costs incurred by Solstice in connection with the verification process.

(f) Remedies. If the Verification Report reveals that one or more MFL Triggering Licenses were entered into and Apex failed to deliver the required MFL Notices, the following remedies shall apply:

(i) Retroactive Adjustment. Solstice's running royalty rate shall be adjusted retroactively to the date on which such adjustment would have taken effect had Apex timely delivered the MFL Notice in accordance with Section 2.1 of this Side Letter (i.e., the first day of the calendar quarter following the date that is thirty (30) calendar days after the execution of the undisclosed MFL Triggering License).

(ii) Overpayment Refund. Apex shall pay to Solstice the difference between the royalties actually paid by Solstice at the higher rate and the royalties that would have been payable at the adjusted lower rate for the period from the retroactive Adjustment Date to the date of actual adjustment.

(iii) Interest. Apex shall pay interest on the overpayment amount calculated under Section 6.2(f)(ii) at the rate specified in Section 5.4 of the License Agreement (the lesser of one and one-half percent (1.5%) per month or the maximum rate permitted by applicable law), accruing from the date each overpayment was made to the date of refund.

SECTION 7: DISPUTE RESOLUTION

7.1 Good-Faith Negotiation. Any dispute, controversy, or claim arising out of or relating to this Side Letter, including any dispute regarding the calculation of the effective running royalty rate under Section 3, the timeliness or adequacy of any MFL Notice under Section 2, or the findings of any Verification Report under Section 6.2, shall first be subject to good-faith negotiation between the General Counsels of the Parties — Eamon Rourke for Solstice and Martin Hale for Apex — for a period of thirty (30) days following written notice of the dispute delivered by the disputing Party to the other Party in accordance with Section 2.3 of this Side Letter. During such negotiation period, the General Counsels shall meet (in person or by videoconference) at least once and shall make reasonable efforts to resolve the dispute on mutually acceptable terms.

7.2 Mediation. If the dispute is not resolved through good-faith negotiation within the thirty (30)-day period described in Section 7.1, either Party may, by written notice to the other Party, submit the dispute to mediation administered by Amberstone ADR Services, located at 1000 North West Street, Suite 1200, Wilmington, Delaware 19801. The mediation shall be conducted before a single mediator mutually agreed upon by the Parties. If the Parties are unable to agree on a mediator within fifteen (15) business days of the submission of the dispute to Amberstone ADR Services, Amberstone ADR Services shall appoint a mediator with experience in patent licensing disputes. The mediation shall take place in Wilmington, Delaware, unless the Parties agree otherwise. The costs of the mediation (excluding each Party's own legal fees and expenses) shall be shared equally by the Parties.

7.3 Litigation. If the dispute is not resolved through mediation within sixty (60) days of the appointment of the mediator (or such longer period as the Parties may agree in writing), either Party may pursue the dispute in the United States District Court for the District of Delaware, which court shall have exclusive jurisdiction over any such dispute. Each Party hereby irrevocably consents to the personal jurisdiction of the United States District Court for the District of Delaware and waives any objection based on forum non conveniens or any other basis. The Parties agree that the dispute resolution procedures set forth in this Section 7 are conditions precedent to the commencement of litigation, and that no Party shall commence litigation under this Section 7.3 without first having complied with Sections 7.1 and 7.2. Nothing in this Section 7 shall prevent either Party from seeking temporary or preliminary injunctive relief from a court of competent jurisdiction to prevent irreparable harm pending completion of the dispute resolution process.

SECTION 8: TERM

This Side Letter shall become effective as of the date first written above (June 16, 2025) and shall remain in full force and effect for the entire term of the License Agreement. The License Agreement is coterminous with the last-to-expire Licensed Patent, which is United States Patent No. 10,932,105, currently scheduled to expire on January 10, 2038, unless earlier terminated in accordance with the termination provisions of the Settlement Agreement (Section 9) or the License Agreement (Section 8). Upon expiration or termination of the License Agreement for any reason, this Side Letter shall automatically terminate and be of no further force or effect, except that (a) any rights or obligations that accrued prior to such termination (including any right to a retroactive rate adjustment or refund under Section 6.2(f)) shall survive, and (b) the confidentiality obligations set forth in Section 5 shall survive for a period of five (5) years following termination.

SECTION 9: GENERAL PROVISIONS

9.1 Governing Law. This Side Letter shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice of law or conflict of laws rules or provisions (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. This governing law provision is consistent with Section 12.1 of the Settlement Agreement and Section 9.1 of the License Agreement.

9.2 Integration with Settlement Agreement and License Agreement. This Side Letter is an integral part of the Settlement Agreement and the License Agreement, and shall be read and construed together with those agreements as a single, integrated transaction. In the event of any conflict or inconsistency between the provisions of this Side Letter and the provisions of the Settlement Agreement or the License Agreement with respect to the MFL notification protocol, the calculation of the effective running royalty rate, the mechanics of rate adjustments, or any other subject matter addressed in this Side Letter, the provisions of this Side Letter shall control and supersede the conflicting provisions of the Settlement Agreement or the License Agreement. For the avoidance of doubt, this Side Letter is not intended to modify, amend, or supersede any provision of the Settlement Agreement or the License Agreement that does not relate to the MFL notification protocol or the administration of the MFL provision.

9.3 Amendments. This Side Letter may not be amended, modified, supplemented, or waived except by a written instrument duly executed by authorized representatives of each Party. No oral agreement, course of dealing, or course of performance shall be effective to amend or modify any provision of this Side Letter.

9.4 Successors and Assigns. This Side Letter shall be binding upon and inure to the benefit of the Parties and their respective successors, heirs, personal representatives, and permitted assigns. Consistent with the non-transferable nature of the license granted under the License Agreement, neither Solstice nor Solstice US may assign or transfer its rights or obligations under this Side Letter without the prior written consent of Apex, except in connection with a change of control of Solstice (as defined in Section 7.2 of the License Agreement), in which case this Side Letter shall be automatically assigned to and assumed by the acquiring entity. Apex may assign its rights and obligations under this Side Letter in connection with an assignment of its rights in the Licensed Patents, provided that any such assignee assumes in writing all of Apex's obligations under this Side Letter.

9.5 Counterparts. This Side Letter may be executed in two or more counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of this Side Letter by electronic mail (including in .pdf format), facsimile, or other electronic transmission shall be effective as delivery of an original executed counterpart. Electronic signatures (including signatures transmitted via Brightwater Software, Ashford Health IT, or similar platforms) shall be deemed valid and binding to the same extent as original ink signatures.

9.6 Severability. If any provision of this Side Letter, or the application of any such provision to any person or circumstance, shall be held invalid, illegal, or unenforceable by a court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision of this Side Letter or the application of such provision to other persons or circumstances, and the remaining provisions of this Side Letter shall remain in full force and effect and shall be enforced to the fullest extent permitted by law. In the event that any provision is held invalid, illegal, or unenforceable, the Parties shall negotiate in good faith to replace such provision with a valid, legal, and enforceable provision that, to the greatest extent possible, achieves the original intent and economic effect of the invalid provision.

9.7 No Waiver. The failure of either Party to enforce any provision of this Side Letter at any time, or the failure of either Party to exercise any right or remedy available under this Side Letter, shall not constitute a waiver of such provision, right, or remedy, or of the right to enforce such provision or exercise such right or remedy at a later time. No waiver of any provision of this Side Letter shall be effective unless made in writing and signed by the waiving Party. A waiver of any particular provision or right shall not be deemed a waiver of any other provision or right, even if similar, nor shall any single waiver constitute a continuing waiver unless otherwise expressly provided.

9.8 Entire Agreement. Together with the Settlement Agreement, the License Agreement, and the other exhibits, schedules, and side letters executed by the Parties on or about June 16, 2025, this Side Letter constitutes the entire agreement of the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous negotiations, representations, warranties, commitments, offers, contracts, and agreements (whether oral or written) relating to the MFL notification protocol and the administration of the MFL provision. Each Party acknowledges that it has not relied on any representation, warranty, or statement made by any other Party that is not expressly set forth in this Side Letter, the Settlement Agreement, or the License Agreement.

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SIGNATURE PAGE TO SIDE LETTER AGREEMENT RE: MOST-FAVORED LICENSEE PROVISION — NOTIFICATION PROTOCOL

IN WITNESS WHEREOF, the Parties have executed this Side Letter Agreement as of the date first written above.

APEX SURGICAL INNOVATIONS, INC.

By: ________

Name: Martin Hale

Title: General Counsel

Date: June 16, 2025

Address: 1220 North Market Street, Suite 550

Wilmington, DE 19801

SOLSTICE BIOMEDICAL DEVICES LTD.

By: ________

Name: Eamon Rourke

Title: General Counsel

Date: June 16, 2025

Address: Unit 14, Clonskeagh Business Park

Clonskeagh Road Dublin 14, D14 YF28, Ireland

SOLSTICE BIOMEDICAL, INC.

By: ________

Name: Brendan Molloy

Title: Chief Financial Officer

Date: June 16, 2025

Address: 3800 Concord Pike, Suite 410

Wilmington, DE 19803

ACKNOWLEDGMENT OF COUNSEL

This Side Letter Agreement was prepared by Calderwood & Harkness LLP (Marcus Delgado and Christy Bauer), counsel for Solstice Biomedical Devices Ltd.

This Side Letter Agreement was reviewed and approved as to form by Hargrove, Tate & Bennington LLP (Victoria Stanton and Derek Loomis), counsel for Apex Surgical Innovations, Inc.

Matter No.: 10294.0017

CALDERWOOD & HARKNESS LLP 1201 Market Street, Suite 2500 Wilmington, DE 19801 Tel: (302) 884-7200 | Fax: (302) 884-7201
Main Office: 299 Park Avenue, 35th Floor New York, NY 10171 Tel: (212) 506-5000 | Fax: (212) 506-5001
June 16, 2025
SIDE LETTER AGREEMENT
RE: MOST-FAVORED LICENSEE PROVISION — NOTIFICATION PROTOCOL
Reference Documents:
This Side Letter Agreement (this "Side Letter") is entered into as of June 16, 2025, by and among the parties identified below, with reference to the following:
(i) The Settlement Agreement and Mutual Release dated as of June 16, 2025 (the "Settlement Agreement"), by and among Solstice Biomedical Devices Ltd., Solstice Biomedical, Inc., and Apex Surgical Innovations, Inc., resolving all claims, counterclaims, and defenses in Apex Surgical Innovations, Inc. v. Solstice Biomedical Devices Ltd. et al., Case No. 1:24-cv-00587-RGA, pending before the United States District Court for the District of Delaware (the "Litigation");
(ii) The Patent License Agreement (Non-Exclusive) attached as Exhibit A to the Settlement Agreement (the "License Agreement"); and
(iii) The underlying Litigation, Case No. 1:24-cv-00587-RGA, before the Honorable Richard G. Andrews, United States District Judge for the District of Delaware.
PARTIES:
Apex Surgical Innovations, Inc. ("Apex"), a corporation organized and existing under the laws of the State of Delaware, with its principal office located at 1220 North Market Street, Suite 550, Wilmington, Delaware 19801, EIN: 51-0483762, acting through its duly authorized signatory, Martin Hale, General Counsel;
Solstice Biomedical Devices Ltd. ("Solstice"), a private limited company organized 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, acting through its duly authorized signatory, Eamon Rourke, General Counsel; and
Solstice Biomedical, Inc. ("Solstice US"), 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, acting through its duly authorized signatory, Brendan Molloy, Chief Financial Officer.
Apex, Solstice, and Solstice US are each referred to herein individually as a "Party" and collectively as the "Parties." Solstice and Solstice US are collectively referred to as the "Solstice Parties."
RECITALS
WHEREAS, Apex and the Solstice Parties have entered into the Settlement Agreement dated as of June 16, 2025, pursuant to which the Parties have agreed to resolve all claims, counterclaims, and defenses asserted or that could have been asserted in the Litigation, Case No. 1:24-cv-00587-RGA, pending before the United States District Court for the District of Delaware;
WHEREAS, contemporaneously with the execution of the Settlement Agreement, Apex and the Solstice Parties have entered into the License Agreement, which is attached as Exhibit A to the Settlement Agreement, pursuant to which Apex has granted to Solstice and Solstice US a non-exclusive license under the Licensed Patents (as defined below) in the Field of Use (as defined below);
WHEREAS, Section 4.6 of the Settlement Agreement and Section 5.3 of the License Agreement provide that Solstice shall be entitled to most-favored licensee ("MFL") treatment with respect to the running royalty rate applicable to the Licensed Patents, which include United States Patent No. 9,814,237 (entitled "Surgical Trocar Assembly with Multi-Seal Valve Mechanism"), United States Patent No. 10,271,884 (entitled "Laparoscopic Access Device with Radial Expansion Feature"), and United States Patent No. 10,932,105 (entitled "Integrated Trocar-Cannula System with Insufflation Control"), together with any continuations, divisionals, or reissues thereof (collectively, the "Licensed Patents");
WHEREAS, under the MFL provision, if Apex enters into a license agreement with any third party for any of the Licensed Patents at a running royalty rate lower than three and three-quarters percent (3.75%) of Net Sales (the "Current Rate"), Solstice's running royalty rate shall be adjusted prospectively to match such lower rate, subject to the terms and conditions set forth in this Side Letter;
WHEREAS, the Parties desire to establish a detailed notification protocol to govern the administration and implementation of the MFL provision, including the manner, timing, and content of required notifications, the methodology for calculating effective running royalty rates in cases involving blended consideration, the mechanics of rate adjustments, and the procedures for verification and dispute resolution; and
WHEREAS, capitalized terms used but not defined herein shall have the meanings ascribed to them in the Settlement Agreement and the License Agreement, as applicable.
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
SECTION 1: DEFINITIONS
For purposes of this Side Letter, the following terms shall have the meanings set forth below. All other capitalized terms used but not defined in this Side Letter shall have the meanings ascribed to them in the Settlement Agreement or the License Agreement, as applicable.
1.1 "Current Rate" means three and three-quarters percent (3.75%) of Net Sales, as established in Section 5.1 of the License Agreement and as may be adjusted from time to time in accordance with the MFL provision and this Side Letter.
1.2 "Licensed Patents" means United States Patent No. 9,814,237 (issued November 14, 2017), United States Patent No. 10,271,884 (issued April 30, 2019), and United States Patent No. 10,932,105 (issued March 2, 2021), together with any and all continuations, divisionals, continuations-in-part, reissues, and reexamination certificates thereof, as further enumerated in Exhibit C to the Settlement Agreement, which identifies fourteen (14) issued United States patents and six (6) pending continuation applications in the Apex Trocar Patent Family.
1.3 "Licensed Products" means the PrecisionEdge™ PE-5000 series, the PrecisionEdge™ PE-12000 series, and the PrecisionEdge™ PE-15000 series laparoscopic surgical access devices, together with any successor products thereto, all as defined in Section 1.12 of the License Agreement.
1.4 "MFL Triggering License" means any license agreement, settlement agreement, covenant not to sue, release, forbearance agreement, or other arrangement or understanding (whether written or oral, and regardless of how denominated) entered into by Apex, or by any successor, assign, parent, subsidiary, or affiliate of Apex, with any Third-Party Licensee that (a) grants rights, immunities, or covenants under one or more of the Licensed Patents, and (b) includes a running royalty rate, or an effective running royalty rate as calculated under Section 3 of this Side Letter, that is lower than the Current Rate or the then-applicable adjusted rate, as the case may be. For the avoidance of doubt, the term "MFL Triggering License" shall include any amendment, modification, restatement, or supplement to an existing third-party license that results in a reduction of the effective running royalty rate below the Current Rate or the then-applicable adjusted rate.
1.5 "Net Sales" shall have the meaning ascribed to that term in Section 1.15 of the License Agreement, which defines Net Sales as the gross invoiced sales price of Licensed Products sold by or on behalf of Solstice or Solstice US to unaffiliated third parties in bona fide arm's-length transactions, less the following deductions to the extent actually incurred and separately stated on the applicable invoice or otherwise documented: (a) trade discounts, quantity discounts, and cash discounts actually allowed and taken; (b) credits, allowances, and refunds for returns, replacements, and rejections; (c) chargebacks, rebates, and retroactive price adjustments; (d) freight, shipping, insurance, and handling charges to the extent separately stated and prepaid or allowed; and (e) sales, use, value-added, and other similar taxes, tariffs, and duties imposed on the sale and included in the gross invoiced price.
1.6 "Third-Party Licensee" means any person, entity, corporation, partnership, limited liability company, joint venture, or other legal entity other than Solstice, Solstice US, or any subsidiary of Solstice or Solstice US, that is granted a license, covenant not to sue, release, or other right or immunity under one or more of the Licensed Patents by Apex or any successor or assignee of Apex.
1.7 "Royalty Floor" means Five Hundred Thousand Dollars ($500,000) per calendar year, beginning with calendar year 2026, as established in Section 5.2(a) of the License Agreement.
1.8 "Royalty Cap" means One Million Eight Hundred Thousand Dollars ($1,800,000) per calendar year, as established in Section 5.2(b) of the License Agreement.
1.9 "Field of Use" means laparoscopic surgical access devices, as defined in Section 1.8 of the License Agreement.
1.10 "Adjustment Date" shall have the meaning ascribed to that term in Section 4.1 of this Side Letter.
1.11 "MFL Compliance Certificate" shall have the meaning ascribed to that term in Section 6.1 of this Side Letter.
1.12 "MFL Notice" shall have the meaning ascribed to that term in Section 2.2 of this Side Letter.
SECTION 2: NOTIFICATION OBLIGATION
2.1 Triggering Event. Apex shall be obligated to provide written notice to the Solstice Parties within thirty (30) calendar days after the execution (or, if later, the effective date) of any MFL Triggering License. This notification obligation is absolute and unconditional, and shall apply irrespective of whether the MFL Triggering License covers all of the Licensed Patents or only a subset thereof, irrespective of whether the MFL Triggering License covers the same Field of Use as the License Agreement or a broader, narrower, or different field, and irrespective of the identity, size, or geographic location of the Third-Party Licensee. For purposes of this Section 2.1, "execution" shall mean the date on which the last Party to sign the MFL Triggering License executes such agreement, or, in the case of an oral arrangement, the date on which the Parties to such arrangement reach a binding agreement.
2.2 Content of Notice. The written notice required under Section 2.1 (the "MFL Notice") shall include the following information:
(a) Date of Execution. The date of execution (or effectiveness) of the MFL Triggering License.
(b) Identity of Third-Party Licensee. The identity of the Third-Party Licensee; provided, however, that if Apex is prohibited from disclosing the specific name of the Third-Party Licensee by a bona fide, pre-existing confidentiality obligation contained in the MFL Triggering License or in a separate confidentiality agreement between Apex and the Third-Party Licensee, Apex may redact the specific name of the Third-Party Licensee from the MFL Notice, but must identify the licensee by a reasonable description that is sufficient to enable Solstice to assess the comparability of the MFL Triggering License, including, at a minimum, the Third-Party Licensee's industry sector, its approximate annual revenue (expressed as a range, e.g., "$100M–$500M"), and the principal geographic markets in which it operates.
(c) Covered Licensed Patents. A specific identification of each Licensed Patent covered by the MFL Triggering License, including United States patent numbers and, where applicable, the filing dates and expected expiration dates of any pending continuation applications included in the MFL Triggering License.
(d) Running Royalty Rate. The running royalty rate (or, where applicable, the effective running royalty rate calculated in accordance with Section 3 of this Side Letter) applicable under the MFL Triggering License, expressed as a percentage of net sales (or the equivalent measure used in the MFL Triggering License).
(e) Field of Use. The field of use, if any, applicable to the MFL Triggering License, together with a description of any restrictions or limitations on the scope of the license grant.
(f) Non-Royalty Consideration. A statement of whether the MFL Triggering License includes any lump-sum payment, upfront fee, milestone payment, cross-license grant, equity consideration, or other non-royalty consideration, together with a reasonably detailed explanation of how Apex calculated the effective running royalty rate in accordance with Section 3 of this Side Letter, including the key assumptions and data inputs used in such calculation.
(g) Effective Date. The effective date of the lower royalty rate under the MFL Triggering License, and, if different, the date as of which the MFL Triggering License became binding on the parties thereto.
2.3 Form of Notice. All MFL Notices required or permitted under this Side Letter shall be in writing and shall be delivered in accordance with the notice provisions set forth in Section 12.4 of the Settlement Agreement, as supplemented by this Section 2.3.
(a) Notices to Solstice. MFL Notices and all other notices to the Solstice Parties under this Side Letter shall be addressed as follows:
Eamon Rourke, General Counsel Solstice Biomedical Devices Ltd. Unit 14, Clonskeagh Business Park Clonskeagh Road Dublin 14, D14 YF28, Ireland
Email: e.rourke@solsticebiomedical.ie
With a copy (which shall not constitute notice) to:
Marcus Delgado, Esq. Calderwood & Harkness LLP 1201 Market Street, Suite 2500 Wilmington, DE 19801
Email: mdelgado@calderwoodharkness.com
(b) Notices to Apex. MFL Notices and all other notices to Apex under this Side Letter shall be addressed as follows:
Martin Hale, General Counsel Apex Surgical Innovations, Inc. 1220 North Market Street, Suite 550 Wilmington, DE 19801
Email: m.hale@apexsurgical.com
With a copy (which shall not constitute notice) to:
Victoria Stanton, Esq. Hargrove, Tate & Bennington LLP 900 North King Street, Suite 1200 Wilmington, DE 19801
Email: vstanton@htblaw.com
(c) Delivery Methods. All notices under this Side Letter shall be delivered by (i) personal delivery, (ii) a nationally recognized overnight courier service (such as Severin Partners LLC, Halcyon Partners LLC, or Tarrant & Co.), or (iii) email, provided that any notice delivered by email must be accompanied by a confirmation of receipt from the recipient (by reply email, read receipt, or other reasonable means of confirmation). Notices shall be deemed effective upon actual receipt by the addressee. Either Party may change its notice address by providing written notice of the change to the other Parties in accordance with this Section 2.3.
SECTION 3: CALCULATION OF EFFECTIVE RUNNING ROYALTY RATE
3.1 Pure Running Royalty Licenses. Where an MFL Triggering License provides solely for a running royalty, without any lump-sum payment, upfront fee, milestone payment, cross-license grant, equity consideration, or other non-royalty consideration, the stated running royalty rate in the MFL Triggering License shall be the effective running royalty rate for purposes of comparison with the Current Rate (or the then-applicable adjusted rate) under the MFL provision. No further calculation or adjustment shall be required.
3.2 Blended Consideration Licenses. Where an MFL Triggering License includes any lump-sum payment, upfront fee, milestone payment, cross-license grant, equity consideration, or other non-royalty consideration, in addition to or in lieu of a running royalty, the effective running royalty rate shall not be determined solely by reference to the stated running royalty rate (if any) in the MFL Triggering License. Instead, Apex shall calculate an "effective running royalty rate" by amortizing all non-royalty consideration over the expected remaining term of the Licensed Patents covered by the MFL Triggering License and the expected sales volume of the Third-Party Licensee's licensed products during such remaining term, using reasonable, good-faith assumptions that are consistent with industry practice and supportable by reference to publicly available data or internal business projections.
(a) Methodology Disclosure. The methodology used by Apex to calculate the effective running royalty rate under this Section 3.2 shall be disclosed to Solstice in the MFL Notice in reasonable detail, including, at a minimum: (i) the total amount of all non-royalty consideration; (ii) the remaining term of the Licensed Patents over which such consideration is amortized; (iii) the projected annual sales volume (in units or dollars) of the Third-Party Licensee's licensed products; (iv) the basis for such sales projections; and (v) the resulting effective running royalty rate, expressed as a percentage.
(b) Fully Paid-Up Licenses. If the MFL Triggering License is a fully paid-up license with no running royalty component, Apex shall calculate an effective running royalty rate by dividing the total consideration paid or payable under the MFL Triggering License by the product of (x) the projected annual Net Sales of the Third-Party Licensee's licensed products (using the same definition of Net Sales as set forth in the License Agreement, or a substantially equivalent measure), multiplied by (y) the remaining weighted-average term of the Licensed Patents covered by the MFL Triggering License, measured from the effective date of such license to the expiration date of the last-to-expire Licensed Patent covered thereby.
(c) Milestone Payments. Where the non-royalty consideration includes milestone payments that are contingent upon the achievement of specified technical, regulatory, or commercial milestones, Apex shall include in the calculation only those milestone payments that have been earned and paid, or that are reasonably likely to be earned based on the Third-Party Licensee's development stage and commercialization timeline, applying a probability-weighted approach consistent with industry practice.
3.3 Cross-License Adjustments. Where an MFL Triggering License involves a cross-license, meaning that the Third-Party Licensee grants to Apex a license under one or more patents or other intellectual property rights owned or controlled by the Third-Party Licensee, the value of such patents or other intellectual property granted by the Third-Party Licensee to Apex shall be excluded from the calculation of the effective running royalty rate under this Section 3. The rationale for this exclusion is that a cross-license grant represents value flowing from the Third-Party Licensee to Apex, not consideration paid by the Third-Party Licensee for rights under the Licensed Patents, and its inclusion would artificially inflate the effective royalty rate.
Notwithstanding the foregoing, if the cross-license grant from the Third-Party Licensee to Apex is nominal, pretextual, or otherwise lacks genuine economic substance — for example, because the patents licensed back to Apex are expired, invalid, or unenforceable, or because the cross-license grant does not cover any products that Apex manufactures, sells, or plans to manufacture or sell — the cross-license grant shall be disregarded in its entirety, and the total consideration under the MFL Triggering License shall be treated as if the cross-license component did not exist.
3.4 Disputes Regarding Effective Rate Calculation. If Solstice disputes Apex's calculation of the effective running royalty rate under this Section 3, including any dispute regarding the reasonableness of the assumptions used, the appropriateness of the methodology applied, or the accuracy of the data inputs employed, such dispute shall be resolved in accordance with the dispute resolution mechanism set forth in Section 7 of this Side Letter. Pending resolution of any such dispute, Solstice's running royalty rate shall remain at the Current Rate (or the then-applicable adjusted rate), and Solstice shall continue to make royalty payments at such rate; provided, however, that if the dispute is ultimately resolved in Solstice's favor, the rate adjustment shall be applied retroactively to the Adjustment Date that would have applied had the dispute not arisen, and Apex shall refund to Solstice any overpayment of royalties, together with interest at the rate specified in Section 5.4 of the License Agreement.
SECTION 4: RATE ADJUSTMENT MECHANICS
4.1 Prospective Adjustment. Upon delivery of a valid MFL Notice disclosing an effective running royalty rate that is lower than the Current Rate (or the then-applicable adjusted rate, as the case may be), Solstice's running royalty rate under the License Agreement shall be automatically adjusted, without the need for any amendment to the License Agreement, to match the lower effective running royalty rate disclosed in the MFL Notice. Such adjustment shall take effect as of the first day of the calendar quarter immediately following the date on which Solstice receives the MFL Notice (the "Adjustment Date"). By way of example, if Solstice receives an MFL Notice on August 15 of a given year, the Adjustment Date would be October 1 of that year.
For the avoidance of doubt, the adjustment contemplated by this Section 4.1 is prospective only. No retroactive credit, refund, or offset shall be due to Solstice for royalty payments properly made at the Current Rate (or the then-applicable adjusted rate) for any period prior to the Adjustment Date, except as otherwise provided in Section 3.4 or Section 6.2 of this Side Letter.
4.2 Adjustment to Floor and Cap. The Royalty Floor of Five Hundred Thousand Dollars ($500,000) per calendar year and the Royalty Cap of One Million Eight Hundred Thousand Dollars ($1,800,000) per calendar year, each as established in the License Agreement, shall remain unchanged and in full force and effect notwithstanding any adjustment to the running royalty rate made pursuant to this Side Letter. The Parties acknowledge that the Royalty Floor and the Royalty Cap were negotiated as independent economic terms of the License Agreement and are not intended to be mechanically linked to the running royalty rate. Notwithstanding the foregoing, if the Parties mutually agree in writing to adjust the Royalty Floor or the Royalty Cap in connection with any adjustment to the running royalty rate, such agreement shall be documented in a separate written amendment to the License Agreement or this Side Letter, duly executed by authorized representatives of each Party.
4.3 Successive Adjustments. The MFL obligation set forth in this Side Letter is ongoing and shall remain in effect for the entire term of the License Agreement. If, following an initial adjustment of Solstice's running royalty rate pursuant to Section 4.1, Apex enters into one or more subsequent MFL Triggering Licenses at running royalty rates (or effective running royalty rates) that are successively lower than the then-applicable adjusted rate, each such event shall trigger a further prospective adjustment of Solstice's running royalty rate in accordance with the procedures set forth in this Section 4. There is no limit on the number of successive adjustments that may occur during the term of the License Agreement, subject in all cases to the Royalty Floor.
4.4 No Upward Adjustment. For the avoidance of doubt, the MFL provision is a one-way ratchet. If Apex enters into a license agreement with a Third-Party Licensee at a running royalty rate (or effective running royalty rate) that is equal to or higher than the Current Rate (or the then-applicable adjusted rate), Solstice's running royalty rate shall not be adjusted upward. The MFL provision entitles Solstice to the benefit of any lower rate, but does not expose Solstice to the risk of any higher rate.
SECTION 5: CONFIDENTIALITY OF MFL NOTICES
5.1 Confidential Treatment. All MFL Notices delivered by Apex to the Solstice Parties pursuant to this Side Letter, and all information contained therein (including the identity of any Third-Party Licensee, the terms of any MFL Triggering License, the effective running royalty rate, and the methodology and assumptions used to calculate such rate), shall be treated as Confidential Information of Apex under and subject to the confidentiality provisions set forth in Section 11.1 of the Settlement Agreement. The Solstice Parties shall not disclose, publish, or otherwise disseminate the contents of any MFL Notice, or any portion thereof, to any person or entity other than:
(a) officers, directors, employees, and authorized agents of Solstice and Solstice US who have a need to know such information for the purpose of administering the License Agreement and the MFL provision, and who are bound by obligations of confidentiality no less restrictive than those set forth herein;
(b) Calderwood & Harkness LLP, Solstice's outside legal counsel, and any successor outside legal counsel retained by Solstice in connection with the License Agreement or this Side Letter;
(c) Glenmore & Byrne LLP, Solstice's independent auditors, or any successor independent auditing firm retained by Solstice, solely for the purpose of auditing Solstice's financial statements and royalty obligations; and
(d) any independent accounting firm engaged pursuant to Section 6.2 of this Side Letter for the purpose of verifying Apex's compliance with the MFL provision.
Each person or entity to whom Confidential Information is disclosed pursuant to this Section 5.1 shall be informed of the confidential nature of such information and shall be required to maintain such information in confidence in accordance with the terms of this Side Letter and the Settlement Agreement.
5.2 Apex's Confidentiality Obligations. Apex shall not disclose to any Third-Party Licensee, or to any other person or entity, the specific running royalty rate, the Royalty Floor, the Royalty Cap, or any other financial terms of Solstice's License Agreement, except to the extent such disclosure is required by applicable law, regulation, court order, or subpoena, in which case Apex shall provide Solstice with prompt written notice of such requirement (to the extent legally permissible) and shall cooperate with Solstice in seeking a protective order or other appropriate remedy to limit the scope of such disclosure. Apex further agrees that it shall not use the existence of the License Agreement or its terms as a benchmark or negotiating tool in discussions with any Third-Party Licensee without the prior written consent of Solstice.
SECTION 6: VERIFICATION AND AUDIT
6.1 Solstice's Verification Right — Annual Certification. No more than once per calendar year, Solstice may submit a written request to Apex for a certification regarding Apex's compliance with its obligations under the MFL provision and this Side Letter. Upon receipt of such request, Apex shall provide to Solstice a written certification (an "MFL Compliance Certificate"), signed by Apex's General Counsel or another officer of Apex with knowledge of the relevant facts, certifying one of the following:
(a) that no MFL Triggering License was entered into during the preceding calendar year; or
(b) that one or more MFL Triggering Licenses were entered into during the preceding calendar year, and that the required MFL Notices were timely delivered to Solstice in accordance with Section 2 of this Side Letter, together with a brief description of each such MFL Triggering License and the corresponding MFL Notice.
Apex shall provide the MFL Compliance Certificate within thirty (30) calendar days of the date on which Apex receives Solstice's written request therefor. The MFL Compliance Certificate shall be delivered in writing in accordance with Section 2.3 of this Side Letter.
6.2 Independent Verification. If Solstice has a reasonable, good-faith basis to believe that Apex has entered into an MFL Triggering License without delivering the required MFL Notice, or that Apex has materially misstated or omitted information in an MFL Notice or an MFL Compliance Certificate, Solstice may, upon not less than thirty (30) calendar days' prior written notice to Apex, engage an independent, nationally recognized accounting firm (the "Independent Auditor") to review Apex's license agreements with third parties solely for the purpose of confirming compliance with the MFL provision and this Side Letter.
(a) Selection of Independent Auditor. The Independent Auditor shall be mutually acceptable to both Parties. If the Parties are unable to agree on an Independent Auditor within fifteen (15) business days of Solstice's notice, either Party may request that Amberstone ADR Services (as identified in Section 7.2) appoint an independent, nationally recognized accounting firm to serve as the Independent Auditor.
(b) Scope of Review. The Independent Auditor's review shall be limited solely to determining (i) whether any MFL Triggering License exists that Apex has not disclosed to Solstice, and (ii) if so, the effective running royalty rate applicable thereunder. The Independent Auditor shall not have the right to review, copy, or disclose any other terms, conditions, or provisions of Apex's third-party license agreements, and shall execute a confidentiality agreement satisfactory to both Parties prior to commencing the review.
(c) Access and Cooperation. Apex shall provide the Independent Auditor with reasonable access to Apex's records and personnel as necessary to complete the review, subject to the confidentiality limitations set forth in Section 6.2(b) above. The review shall be conducted during normal business hours at Apex's offices, or at such other location as the Parties may agree.
(d) Report. The Independent Auditor shall issue a written report to both Parties (the "Verification Report") setting forth its findings, including (i) whether any undisclosed MFL Triggering License was identified, (ii) the effective running royalty rate thereunder, and (iii) the date of execution thereof. The Verification Report shall not include any other information regarding Apex's third-party license agreements.
(e) Cost Allocation. The costs and expenses of the Independent Auditor shall be borne by Solstice; provided, however, that if the Verification Report reveals that one or more MFL Triggering Licenses were entered into and Apex failed to deliver the required MFL Notices, then Apex shall bear the full costs and expenses of the Independent Auditor and shall reimburse Solstice for any costs incurred by Solstice in connection with the verification process.
(f) Remedies. If the Verification Report reveals that one or more MFL Triggering Licenses were entered into and Apex failed to deliver the required MFL Notices, the following remedies shall apply:
(i) Retroactive Adjustment. Solstice's running royalty rate shall be adjusted retroactively to the date on which such adjustment would have taken effect had Apex timely delivered the MFL Notice in accordance with Section 2.1 of this Side Letter (i.e., the first day of the calendar quarter following the date that is thirty (30) calendar days after the execution of the undisclosed MFL Triggering License).
(ii) Overpayment Refund. Apex shall pay to Solstice the difference between the royalties actually paid by Solstice at the higher rate and the royalties that would have been payable at the adjusted lower rate for the period from the retroactive Adjustment Date to the date of actual adjustment.
(iii) Interest. Apex shall pay interest on the overpayment amount calculated under Section 6.2(f)(ii) at the rate specified in Section 5.4 of the License Agreement (the lesser of one and one-half percent (1.5%) per month or the maximum rate permitted by applicable law), accruing from the date each overpayment was made to the date of refund.
SECTION 7: DISPUTE RESOLUTION
7.1 Good-Faith Negotiation. Any dispute, controversy, or claim arising out of or relating to this Side Letter, including any dispute regarding the calculation of the effective running royalty rate under Section 3, the timeliness or adequacy of any MFL Notice under Section 2, or the findings of any Verification Report under Section 6.2, shall first be subject to good-faith negotiation between the General Counsels of the Parties — Eamon Rourke for Solstice and Martin Hale for Apex — for a period of thirty (30) days following written notice of the dispute delivered by the disputing Party to the other Party in accordance with Section 2.3 of this Side Letter. During such negotiation period, the General Counsels shall meet (in person or by videoconference) at least once and shall make reasonable efforts to resolve the dispute on mutually acceptable terms.
7.2 Mediation. If the dispute is not resolved through good-faith negotiation within the thirty (30)-day period described in Section 7.1, either Party may, by written notice to the other Party, submit the dispute to mediation administered by Amberstone ADR Services, located at 1000 North West Street, Suite 1200, Wilmington, Delaware 19801. The mediation shall be conducted before a single mediator mutually agreed upon by the Parties. If the Parties are unable to agree on a mediator within fifteen (15) business days of the submission of the dispute to Amberstone ADR Services, Amberstone ADR Services shall appoint a mediator with experience in patent licensing disputes. The mediation shall take place in Wilmington, Delaware, unless the Parties agree otherwise. The costs of the mediation (excluding each Party's own legal fees and expenses) shall be shared equally by the Parties.
7.3 Litigation. If the dispute is not resolved through mediation within sixty (60) days of the appointment of the mediator (or such longer period as the Parties may agree in writing), either Party may pursue the dispute in the United States District Court for the District of Delaware, which court shall have exclusive jurisdiction over any such dispute. Each Party hereby irrevocably consents to the personal jurisdiction of the United States District Court for the District of Delaware and waives any objection based on forum non conveniens or any other basis. The Parties agree that the dispute resolution procedures set forth in this Section 7 are conditions precedent to the commencement of litigation, and that no Party shall commence litigation under this Section 7.3 without first having complied with Sections 7.1 and 7.2. Nothing in this Section 7 shall prevent either Party from seeking temporary or preliminary injunctive relief from a court of competent jurisdiction to prevent irreparable harm pending completion of the dispute resolution process.
SECTION 8: TERM
This Side Letter shall become effective as of the date first written above (June 16, 2025) and shall remain in full force and effect for the entire term of the License Agreement. The License Agreement is coterminous with the last-to-expire Licensed Patent, which is United States Patent No. 10,932,105, currently scheduled to expire on January 10, 2038, unless earlier terminated in accordance with the termination provisions of the Settlement Agreement (Section 9) or the License Agreement (Section 8). Upon expiration or termination of the License Agreement for any reason, this Side Letter shall automatically terminate and be of no further force or effect, except that (a) any rights or obligations that accrued prior to such termination (including any right to a retroactive rate adjustment or refund under Section 6.2(f)) shall survive, and (b) the confidentiality obligations set forth in Section 5 shall survive for a period of five (5) years following termination.
SECTION 9: GENERAL PROVISIONS
9.1 Governing Law. This Side Letter shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice of law or conflict of laws rules or provisions (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. This governing law provision is consistent with Section 12.1 of the Settlement Agreement and Section 9.1 of the License Agreement.
9.2 Integration with Settlement Agreement and License Agreement. This Side Letter is an integral part of the Settlement Agreement and the License Agreement, and shall be read and construed together with those agreements as a single, integrated transaction. In the event of any conflict or inconsistency between the provisions of this Side Letter and the provisions of the Settlement Agreement or the License Agreement with respect to the MFL notification protocol, the calculation of the effective running royalty rate, the mechanics of rate adjustments, or any other subject matter addressed in this Side Letter, the provisions of this Side Letter shall control and supersede the conflicting provisions of the Settlement Agreement or the License Agreement. For the avoidance of doubt, this Side Letter is not intended to modify, amend, or supersede any provision of the Settlement Agreement or the License Agreement that does not relate to the MFL notification protocol or the administration of the MFL provision.
9.3 Amendments. This Side Letter may not be amended, modified, supplemented, or waived except by a written instrument duly executed by authorized representatives of each Party. No oral agreement, course of dealing, or course of performance shall be effective to amend or modify any provision of this Side Letter.
9.4 Successors and Assigns. This Side Letter shall be binding upon and inure to the benefit of the Parties and their respective successors, heirs, personal representatives, and permitted assigns. Consistent with the non-transferable nature of the license granted under the License Agreement, neither Solstice nor Solstice US may assign or transfer its rights or obligations under this Side Letter without the prior written consent of Apex, except in connection with a change of control of Solstice (as defined in Section 7.2 of the License Agreement), in which case this Side Letter shall be automatically assigned to and assumed by the acquiring entity. Apex may assign its rights and obligations under this Side Letter in connection with an assignment of its rights in the Licensed Patents, provided that any such assignee assumes in writing all of Apex's obligations under this Side Letter.
9.5 Counterparts. This Side Letter may be executed in two or more counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of this Side Letter by electronic mail (including in .pdf format), facsimile, or other electronic transmission shall be effective as delivery of an original executed counterpart. Electronic signatures (including signatures transmitted via Brightwater Software, Ashford Health IT, or similar platforms) shall be deemed valid and binding to the same extent as original ink signatures.
9.6 Severability. If any provision of this Side Letter, or the application of any such provision to any person or circumstance, shall be held invalid, illegal, or unenforceable by a court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision of this Side Letter or the application of such provision to other persons or circumstances, and the remaining provisions of this Side Letter shall remain in full force and effect and shall be enforced to the fullest extent permitted by law. In the event that any provision is held invalid, illegal, or unenforceable, the Parties shall negotiate in good faith to replace such provision with a valid, legal, and enforceable provision that, to the greatest extent possible, achieves the original intent and economic effect of the invalid provision.
9.7 No Waiver. The failure of either Party to enforce any provision of this Side Letter at any time, or the failure of either Party to exercise any right or remedy available under this Side Letter, shall not constitute a waiver of such provision, right, or remedy, or of the right to enforce such provision or exercise such right or remedy at a later time. No waiver of any provision of this Side Letter shall be effective unless made in writing and signed by the waiving Party. A waiver of any particular provision or right shall not be deemed a waiver of any other provision or right, even if similar, nor shall any single waiver constitute a continuing waiver unless otherwise expressly provided.
9.8 Entire Agreement. Together with the Settlement Agreement, the License Agreement, and the other exhibits, schedules, and side letters executed by the Parties on or about June 16, 2025, this Side Letter constitutes the entire agreement of the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous negotiations, representations, warranties, commitments, offers, contracts, and agreements (whether oral or written) relating to the MFL notification protocol and the administration of the MFL provision. Each Party acknowledges that it has not relied on any representation, warranty, or statement made by any other Party that is not expressly set forth in this Side Letter, the Settlement Agreement, or the License Agreement.
[SIGNATURE PAGE FOLLOWS]
SIGNATURE PAGE TO SIDE LETTER AGREEMENT RE: MOST-FAVORED LICENSEE PROVISION — NOTIFICATION PROTOCOL
IN WITNESS WHEREOF, the Parties have executed this Side Letter Agreement as of the date first written above.
APEX SURGICAL INNOVATIONS, INC.
By: ________
Name: Martin Hale
Title: General Counsel
Date: June 16, 2025
Address: 1220 North Market Street, Suite 550
Wilmington, DE 19801
SOLSTICE BIOMEDICAL DEVICES LTD.
By: ________
Name: Eamon Rourke
Title: General Counsel
Date: June 16, 2025
Address: Unit 14, Clonskeagh Business Park
Clonskeagh Road Dublin 14, D14 YF28, Ireland
SOLSTICE BIOMEDICAL, INC.
By: ________
Name: Brendan Molloy
Title: Chief Financial Officer
Date: June 16, 2025
Address: 3800 Concord Pike, Suite 410
Wilmington, DE 19803
ACKNOWLEDGMENT OF COUNSEL
This Side Letter Agreement was prepared by Calderwood & Harkness LLP (Marcus Delgado and Christy Bauer), counsel for Solstice Biomedical Devices Ltd.
This Side Letter Agreement was reviewed and approved as to form by Hargrove, Tate & Bennington LLP (Victoria Stanton and Derek Loomis), counsel for Apex Surgical Innovations, Inc.
Matter No.: 10294.0017

June 16, 2025

SIDE LETTER AGREEMENT

PARTIES:

RECITALS

SECTION 1: DEFINITIONS

SECTION 2: NOTIFICATION OBLIGATION

SECTION 3: CALCULATION OF EFFECTIVE RUNNING ROYALTY RATE

SECTION 4: RATE ADJUSTMENT MECHANICS

SECTION 5: CONFIDENTIALITY OF MFL NOTICES

SECTION 6: VERIFICATION AND AUDIT

SECTION 7: DISPUTE RESOLUTION

SECTION 8: TERM

SECTION 9: GENERAL PROVISIONS

APEX SURGICAL INNOVATIONS, INC.

SOLSTICE BIOMEDICAL DEVICES LTD.

SOLSTICE BIOMEDICAL, INC.

ACKNOWLEDGMENT OF COUNSEL

Record

Parties

Dates

Amounts