x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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04-3523891
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(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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9 Oak Park Drive
Bedford, Massachusetts
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|
01730
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(Address of Principal Executive Offices)
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(Zip Code)
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Large accelerated filer
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x
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Accelerated filer
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¨
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Non-accelerated filer
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¨
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(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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Page
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Item 1.
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Consolidated Financial Statements
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||
|
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2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
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(Unaudited)
(In thousands, except share and per share data)
|
||||||||||||||
Revenue
|
|
$
|
61,103
|
|
|
$
|
54,752
|
|
|
$
|
178,551
|
|
|
$
|
153,541
|
|
Cost of revenue
|
|
33,708
|
|
|
30,362
|
|
|
99,168
|
|
|
86,524
|
|
||||
Gross profit
|
|
27,395
|
|
|
24,390
|
|
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79,383
|
|
|
67,017
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
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||||||||
Research and development
|
|
5,771
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|
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6,559
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15,341
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|
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18,512
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|
||||
General and administrative
|
|
23,530
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|
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12,731
|
|
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50,525
|
|
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38,416
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|
||||
Sales and marketing
|
|
15,407
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13,571
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42,858
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|
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39,974
|
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||||
Total operating expenses
|
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44,708
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32,861
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|
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108,724
|
|
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96,902
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|
||||
Operating loss
|
|
(17,313
|
)
|
|
(8,471
|
)
|
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(29,341
|
)
|
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(29,885
|
)
|
||||
Interest income
|
|
27
|
|
|
31
|
|
|
91
|
|
|
83
|
|
||||
Interest and other expense
|
|
(3,999
|
)
|
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(3,949
|
)
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(12,970
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)
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(11,728
|
)
|
||||
Other expense, net
|
|
(3,972
|
)
|
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(3,918
|
)
|
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(12,879
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)
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(11,645
|
)
|
||||
Loss before income taxes
|
|
(21,285
|
)
|
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(12,389
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)
|
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(42,220
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)
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(41,530
|
)
|
||||
Income tax expense
|
|
(5
|
)
|
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(28
|
)
|
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(254
|
)
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(143
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)
|
||||
Net loss
|
|
$
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(21,290
|
)
|
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$
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(12,417
|
)
|
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$
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(42,474
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)
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$
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(41,673
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)
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Net loss per share basic and diluted
|
|
$
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(0.39
|
)
|
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$
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(0.26
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)
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$
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(0.79
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)
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$
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(0.87
|
)
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Weighted-average number of shares used in calculating net loss per share
|
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54,458,364
|
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48,041,392
|
|
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53,786,974
|
|
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47,825,136
|
|
|
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Nine Months Ended
September 30,
|
||||||
|
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2013
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|
2012
|
||||
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(Unaudited)
(In thousands)
|
||||||
Cash flows from operating activities
|
|
|
|
|
||||
Net loss
|
|
$
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(42,474
|
)
|
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$
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(41,673
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)
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Adjustments to reconcile net loss to net cash provided by (used in) operating activities
|
|
|
|
|
||||
Depreciation and amortization
|
|
8,859
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|
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8,092
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|
||
Non-cash interest and other expense
|
|
8,726
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|
|
7,556
|
|
||
Stock-based compensation expense
|
|
9,800
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|
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7,500
|
|
||
Provision for bad debts
|
|
3,942
|
|
|
2,321
|
|
||
Impairment and other charges
|
|
2,511
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|
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—
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Accounts receivable
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(5,113
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)
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(9,276
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)
|
||
Inventories
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9,472
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|
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(3,251
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)
|
||
Deferred revenue
|
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(4,878
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)
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(1,444
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)
|
||
Prepaid expenses and other assets
|
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(1,401
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)
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(1,966
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)
|
||
Accounts payable, accrued expenses and other current liabilities
|
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16,722
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|
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8,657
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|
||
Other long-term liabilities
|
|
700
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|
|
18
|
|
||
Net cash provided by (used in) operating activities
|
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6,866
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|
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(23,466
|
)
|
||
Cash flows from investing activities
|
|
|
|
|
||||
Purchases of property and equipment
|
|
(4,517
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)
|
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(8,936
|
)
|
||
Net cash used in investing activities
|
|
(4,517
|
)
|
|
(8,936
|
)
|
||
Cash flows from financing activities
|
|
|
|
|
||||
Payments for capital lease obligations
|
|
(336
|
)
|
|
—
|
|
||
Repayment of debt
|
|
(2,000
|
)
|
|
—
|
|
||
Net proceeds from issuance of common stock
|
|
99,164
|
|
|
3,142
|
|
||
Payment of withholding taxes in connection with vesting of restricted stock units
|
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(2,565
|
)
|
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(1,252
|
)
|
||
Net cash provided by financing activities
|
|
94,263
|
|
|
1,890
|
|
||
Net increase (decrease) in cash and cash equivalents
|
|
96,612
|
|
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(30,512
|
)
|
||
Cash and cash equivalents, beginning of period
|
|
57,293
|
|
|
93,955
|
|
||
Cash and cash equivalents, end of period
|
|
$
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153,905
|
|
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$
|
63,443
|
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Non-cash investing and financing activities
|
|
|
|
|
||||
Common stock issued in exchange for 5.375% Convertible Senior Notes
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$
|
13,000
|
|
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$
|
—
|
|
Purchases of property and equipment under capital lease
|
|
$
|
9,021
|
|
|
$
|
—
|
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•
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The evidence of an arrangement generally consists of a physician order form, a patient information form and, if applicable, third-party insurance approval for sales directly to patients or a purchase order for sales to a third-party distributor.
|
•
|
Transfer of title and risk and rewards of ownership are passed to the patient or third-party distributor upon shipment of the products.
|
•
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The selling prices for all sales are fixed and agreed with the patient or third-party distributor and, if applicable, the patient’s third-party insurance provider(s), prior to shipment and are based on established list prices or, in the case of certain third-party insurers, contractually agreed upon prices. Provisions for discounts and rebates to customers are established as a reduction to revenue in the same period the related sales are recorded.
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|
As of
|
||||||
|
September 30,
2013
|
|
December 31,
2012
|
||||
Principal amount of the 5.375% Convertible Senior Notes
|
$
|
—
|
|
|
$
|
15,000
|
|
Principal amount of the 3.75% Convertible Senior Notes
|
143,750
|
|
|
143,750
|
|
||
Unamortized discount
|
(32,633
|
)
|
|
(40,591
|
)
|
||
Total long-term debt
|
111,117
|
|
|
118,159
|
|
||
Current portion of debt
|
—
|
|
|
14,429
|
|
||
Long-term debt
|
$
|
111,117
|
|
|
$
|
103,730
|
|
Deferred financing costs
|
$
|
1,560
|
|
|
$
|
2,004
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Contractual coupon interest
|
$
|
1,347
|
|
|
$
|
1,549
|
|
|
$
|
4,356
|
|
|
$
|
4,647
|
|
Accretion of debt discount
|
2,447
|
|
|
2,420
|
|
|
7,958
|
|
|
7,111
|
|
||||
Loss on debt extinguishment
|
—
|
|
|
—
|
|
|
325
|
|
|
—
|
|
||||
Amortization of debt issuance costs
|
146
|
|
|
148
|
|
|
443
|
|
|
445
|
|
||||
Total interest and other expense
|
$
|
3,940
|
|
|
$
|
4,117
|
|
|
$
|
13,082
|
|
|
$
|
12,203
|
|
Year Ending
December 31,
|
Minimum Lease
Payments
|
||
2013 (remaining)
|
954
|
|
|
2014
|
3,815
|
|
|
2015
|
3,815
|
|
|
2016
|
2,409
|
|
|
Total
|
$
|
10,993
|
|
|
Three and Nine Months Ended
September 30, |
||||
|
2013
|
|
2012
|
||
5.375% Convertible Senior Notes
|
—
|
|
|
702,701
|
|
3.75% Convertible Senior Notes
|
5,487,642
|
|
|
5,487,642
|
|
Unvested restricted stock units
|
1,034,277
|
|
|
863,651
|
|
Outstanding options
|
2,130,560
|
|
|
2,693,936
|
|
Outstanding warrants
|
62,752
|
|
|
62,752
|
|
Total dilutive common shares
|
8,715,231
|
|
|
9,810,682
|
|
|
As of
|
||||||
September 30,
2013
|
|
December 31, 2012
|
|||||
(In thousands)
|
|||||||
Trade receivables
|
$
|
41,762
|
|
|
$
|
39,921
|
|
Allowance for doubtful accounts
|
(7,297
|
)
|
|
(6,627
|
)
|
||
Total accounts receivable
|
$
|
34,465
|
|
|
$
|
33,294
|
|
|
As of
|
||||||
September 30,
2013
|
|
December 31, 2012
|
|||||
(In thousands)
|
|||||||
Raw materials
|
$
|
321
|
|
|
$
|
1,487
|
|
Work-in-process
|
6
|
|
|
1,595
|
|
||
Finished goods
|
5,068
|
|
|
11,785
|
|
||
Total inventories
|
$
|
5,395
|
|
|
$
|
14,867
|
|
|
As of
|
||||||
September 30,
2013
|
|
December 31,
2012
|
|||||
(In thousands)
|
|||||||
Customer relationships
|
$
|
30,100
|
|
|
$
|
30,100
|
|
Tradename
|
2,800
|
|
|
2,800
|
|
||
Total intangible assets
|
32,900
|
|
|
32,900
|
|
||
Less: accumulated amortization
|
(13,746
|
)
|
|
(9,937
|
)
|
||
Total
|
$
|
19,154
|
|
|
$
|
22,963
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
|
(In thousands)
|
||||||||||||||
Balance at the beginning of the period
|
$
|
2,401
|
|
|
$
|
1,822
|
|
|
$
|
1,992
|
|
|
$
|
1,960
|
|
Warranty expense
|
1,110
|
|
|
645
|
|
|
2,771
|
|
|
1,867
|
|
||||
Warranty claims settled
|
(702
|
)
|
|
(661
|
)
|
|
(1,954
|
)
|
|
(2,021
|
)
|
||||
Balance at the end of the period
|
$
|
2,809
|
|
|
$
|
1,806
|
|
|
$
|
2,809
|
|
|
$
|
1,806
|
|
|
As of
|
||||||
|
September 30,
2013
|
|
December 31,
2012
|
||||
|
(In thousands)
|
||||||
Composition of balance:
|
|
|
|
||||
Short-term
|
$
|
1,047
|
|
|
$
|
863
|
|
Long-term
|
1,762
|
|
|
1,129
|
|
||
|
$
|
2,809
|
|
|
$
|
1,992
|
|
|
Number of
Options (#)
|
|
Weighted
Average
Exercise
Price ($)
|
|
Aggregate
Intrinsic
Value ($)
|
|
||||||
|
|
|
|
|
(In thousands)
|
|
||||||
Balance, December 31, 2012
|
2,502,190
|
|
|
$
|
13.51
|
|
|
|
|
|||
Granted
|
276,900
|
|
|
25.54
|
|
|
|
|
||||
Exercised
|
(595,159
|
)
|
|
10.30
|
|
|
$
|
10,930
|
|
(1
|
)
|
|
Canceled
|
(53,371
|
)
|
|
19.36
|
|
|
|
|
||||
Balance, September 30, 2013
|
2,130,560
|
|
|
$
|
15.82
|
|
|
$
|
43,499
|
|
|
|
Vested, September 30, 2013
|
1,302,995
|
|
|
$
|
12.70
|
|
|
$
|
30,676
|
|
(2
|
)
|
Vested and expected to vest, September 30, 2013 (3)
|
1,827,646
|
|
|
|
|
$
|
38,633
|
|
(2
|
)
|
(1)
|
The aggregate intrinsic value was calculated based on the positive difference between the fair market value of the Company’s common stock as of the date of exercise and the exercise price of the underlying options.
|
(2)
|
The aggregate intrinsic value was calculated based on the positive difference between the fair market value of the Company’s common stock as of
September 30, 2013
and the exercise price of the underlying options.
|
(3)
|
Represents the number of vested options as of
September 30, 2013
, plus the number of unvested options expected to vest as of
September 30, 2013
, based on the unvested options outstanding as of
September 30, 2013
, adjusted for the estimated forfeiture rate of
16%
.
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Current
|
$
|
(20
|
)
|
|
$
|
15
|
|
|
$
|
171
|
|
|
$
|
78
|
|
Deferred
|
25
|
|
|
13
|
|
|
83
|
|
|
65
|
|
||||
Total
|
$
|
5
|
|
|
$
|
28
|
|
|
$
|
254
|
|
|
$
|
143
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||||||||
|
|
2013
|
|
2012
|
|
% Change
|
|
2013
|
|
2012
|
|
% Change
|
||||||||||
|
|
(In thousands)
|
|
|
|
(In thousands)
|
|
|
||||||||||||||
Revenue
|
|
$
|
61,103
|
|
|
$
|
54,752
|
|
|
12
|
%
|
|
$
|
178,551
|
|
|
$
|
153,541
|
|
|
16
|
%
|
Cost of revenue
|
|
33,708
|
|
|
30,362
|
|
|
11
|
%
|
|
99,168
|
|
|
86,524
|
|
|
15
|
%
|
||||
Gross profit
|
|
27,395
|
|
|
24,390
|
|
|
12
|
%
|
|
79,383
|
|
|
67,017
|
|
|
18
|
%
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Research and development
|
|
5,771
|
|
|
6,559
|
|
|
12
|
%
|
|
15,341
|
|
|
18,512
|
|
|
17
|
%
|
||||
General and administrative
|
|
23,530
|
|
|
12,731
|
|
|
85
|
%
|
|
50,525
|
|
|
38,416
|
|
|
32
|
%
|
||||
Sales and marketing
|
|
15,407
|
|
|
13,571
|
|
|
14
|
%
|
|
42,858
|
|
|
39,974
|
|
|
7
|
%
|
||||
Total operating expenses
|
|
44,708
|
|
|
32,861
|
|
|
36
|
%
|
|
108,724
|
|
|
96,902
|
|
|
12
|
%
|
||||
Operating loss
|
|
(17,313
|
)
|
|
(8,471
|
)
|
|
104
|
%
|
|
(29,341
|
)
|
|
(29,885
|
)
|
|
2
|
%
|
||||
Other expense, net
|
|
(3,972
|
)
|
|
(3,918
|
)
|
|
1
|
%
|
|
(12,879
|
)
|
|
(11,645
|
)
|
|
11
|
%
|
||||
Income tax expense
|
|
(5
|
)
|
|
(28
|
)
|
|
82
|
%
|
|
(254
|
)
|
|
(143
|
)
|
|
78
|
%
|
||||
Net loss
|
|
$
|
(21,290
|
)
|
|
$
|
(12,417
|
)
|
|
71
|
%
|
|
$
|
(42,474
|
)
|
|
$
|
(41,673
|
)
|
|
2
|
%
|
|
|
As of
|
||||||
|
|
September 30, 2013
|
|
December 31, 2012
|
||||
Principal amount of the 5.375% Convertible Senior Notes
|
|
$
|
—
|
|
|
$
|
15,000
|
|
Principal amount of the 3.75% Convertible Senior Notes
|
|
143,750
|
|
|
143,750
|
|
||
Unamortized discount
|
|
(32,633
|
)
|
|
(40,591
|
)
|
||
Total debt
|
|
111,117
|
|
|
118,159
|
|
||
Current portion of long-term debt
|
|
—
|
|
|
14,429
|
|
||
Long-term debt
|
|
$
|
111,117
|
|
|
$
|
103,730
|
|
Deferred financing costs
|
|
$
|
1,560
|
|
|
$
|
2,004
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Contractual coupon interest
|
|
$
|
1,347
|
|
|
$
|
1,549
|
|
|
$
|
4,356
|
|
|
$
|
4,647
|
|
Accretion of debt discount
|
|
2,447
|
|
|
2,420
|
|
|
7,958
|
|
|
7,111
|
|
||||
Loss on debt extinguishment
|
|
—
|
|
|
—
|
|
|
325
|
|
|
—
|
|
||||
Amortization of debt issuance costs
|
|
146
|
|
|
148
|
|
|
443
|
|
|
445
|
|
||||
Total interest and other expense
|
|
$
|
3,940
|
|
|
$
|
4,117
|
|
|
$
|
13,082
|
|
|
$
|
12,203
|
|
Year Ending
December 31,
|
Minimum Lease
Payments
|
||
2013 (remaining)
|
954
|
|
|
2014
|
3,815
|
|
|
2015
|
3,815
|
|
|
2016
|
2,409
|
|
|
Total
|
$
|
10,993
|
|
|
|
Nine Months Ended
September 30,
|
||||||
|
|
2013
|
|
2012
|
||||
|
|
(In thousands)
|
||||||
Cash provided by (used in) operating activities
|
|
$
|
6,866
|
|
|
$
|
(23,466
|
)
|
Net loss
|
|
$
|
(42,474
|
)
|
|
$
|
(41,673
|
)
|
|
|
Nine Months Ended
September 30,
|
||||||
|
|
2013
|
|
2012
|
||||
|
|
(In thousands)
|
||||||
Cash used in investing activities
|
|
$
|
(4,517
|
)
|
|
$
|
(8,936
|
)
|
Cash provided by financing activities
|
|
$
|
94,263
|
|
|
$
|
1,890
|
|
|
|
Payments Due in
|
||||||||||||||||||
Contractual Obligations
|
|
Total
|
|
2013
Remaining
|
|
2014
|
|
2015
|
|
2016
|
||||||||||
Operating lease obligations
|
|
$
|
1,591
|
|
|
$
|
361
|
|
|
$
|
1,134
|
|
|
$
|
96
|
|
|
$
|
—
|
|
Debt obligations (1)
|
|
158,350
|
|
|
1,347
|
|
|
5,391
|
|
|
5,391
|
|
|
146,221
|
|
|||||
Capital lease obligations (2)
|
|
10,993
|
|
|
954
|
|
|
3,815
|
|
|
3,815
|
|
|
2,409
|
|
|||||
Total contractual obligations
|
|
$
|
170,934
|
|
|
$
|
2,662
|
|
|
$
|
10,340
|
|
|
$
|
9,302
|
|
|
$
|
148,630
|
|
(1)
|
The interest rate on the convertible debt is 3.75% per annum. We have included future payments of interest on the long-term debt in our obligations.
|
(2)
|
The effective interest rate on the capital lease obligations is 17%. We have included future payments of interest on the capital lease in our obligations.
|
Exhibit
Number
|
|
Description of Document
|
|
|
|
10.1+
|
|
Settlement and Cross-License Agreement, dated September 18, 2013, by and among the Company and Medtronic Inc., Medtronic MiniMed Inc., and Medtronic Puerto Rico Operations Co.
|
|
|
|
31.1
|
|
Certification of Duane DeSisto, President and Chief Executive Officer, pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
31.2
|
|
Certification of Brian Roberts, Chief Financial Officer, pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
32.1
|
|
Certification of Duane DeSisto, President and Chief Executive Officer, and Brian Roberts, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
101§
|
|
The following materials from Insulet Corporation’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2013, formatted in XBRL (eXtensible Business Reporting Language), as follows:
|
|
|
|
|
|
(i) Consolidated Balance Sheets as of September 30, 2013 and December 31, 2012 (Unaudited)
|
|
|
|
|
|
(ii) Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2013 and September 30, 2012 (Unaudited)
|
|
|
|
|
|
(iii) Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2013 and September 30, 2012 (Unaudited)
|
|
|
|
|
|
(iv) Notes to Condensed Consolidated Financial Statements (Unaudited)
|
§
|
As provided in Rule 406T of Regulation S-T, this information is furnished and not filed for purposes of Sections 11 and 12 of the Securities Act of 1933, as amended, and Section 18 of the Securities Exchange Act of 1934, as amended.
|
+
|
Application has been made to the Securities and Exchange Commission for confidential treatment of certain provisions. Omitted material for which confidential treatment has been requested has been filed separately with the Securities and Exchange Commission.
|
|
INSULET CORPORATION
(Registrant)
|
|
|
Date: November 7, 2013
|
/s/ Duane DeSisto
|
|
Duane DeSisto
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
|
|
Date: November 7, 2013
|
/s/ Brian Roberts
|
|
Brian Roberts
|
|
Chief Financial Officer
(Principal Financial and Accounting Officer)
|
1.
|
DEFINITIONS
|
(a)
|
an organization, which directly or indirectly controls such entity;
|
(b)
|
an organization, which is directly or indirectly controlled by such entity;
|
(c)
|
an organization, which is controlled, directly or indirectly, by the ultimate parent company of such entity.
|
2.
|
LICENSE AND SETTLEMENT
|
2.1.1
|
The Insulet License shall not extend to any MiniMed Claims that alone, or in combination with the Insulet License, cover Closed-Loop implementation, functionality, design and/or algorithms.
|
2.1.2
|
The Insulet License shall not include the right to assign or grant sublicenses, other than to Affiliates, sellers of Insulet products or “have-made” licenses solely for Insulet sales or distribution.
|
2.1.3
|
MiniMed represents and warrants that if MiniMed makes any future transfer of MiniMed Claims covered by the Insulet License, such transfer shall be subject to the Insulet License.
|
2.1.4
|
MiniMed further represents and warrants that, as of the Effective Date, MiniMed has not transferred any MiniMed Patents to a non-practicing entity.
|
2.2.1
|
The Medtronic License shall not include the right to assign or grant sublicenses, other than to Affiliates, sellers of Medtronic products or “have-made” licenses solely for Medtronic sales or distribution.
|
2.2.2
|
Notwithstanding the foregoing, nothing in the Medtronic License confers any rights to Medtronic to use, sell, offer to sell, manufacture, or import a one-piece ambulatory external drug delivery pump which adheres to the body, has no controls on the pump itself, is operated via a hand-held remote, and is disposed of in its entirety after use.
|
2.2.3
|
Medtronic agrees that it will not cause or ask Flextronics International Ltd. or one of its Affiliates to design or manufacture a one-piece ambulatory external drug delivery pump that adheres to the body.
|
2.2.4
|
Insulet represents and warrants that if Insulet makes any future transfer of Insulet Claims covered by the Medtronic License, such transfer shall be subject to the Medtronic License.
|
2.2.5
|
Insulet further represents and warrants that, as of the Effective Date, Insulet has not transferred any Insulet Patents to a non-practicing entity.
|
3.
|
REMUNERATION
|
4.
|
[ . . . *** . . . ]
|
5.
|
TERM
|
6.
|
CHANGE OF CONTROL AND COVENANTS
|
7.
|
REPRESENTATIONS AND WARRANTIES
|
7.1.1
|
Medtronic, Inc. is a corporation validly existing
and in good standing under the laws of the State of Minnesota. Medtronic MiniMed, Inc. and MiniMed Distribution Corp. are each corporations validly existing and in good standing under the laws of the State of Delaware. Medtronic Puerto Rico Operations Co. is a corporation validly existing and in good standing under the laws of the Cayman Islands.
Medtronic, MiniMed, MDC and MPROC each has all requisite power and authority to enter into this
Agreement, to grant the Insulet License, to otherwise carry out the transactions and perform its obligations as contemplated hereby;
|
7.1.2
|
This Agreement has been duly
authorized, executed and delivered by each of Medtronic, MiniMed, MDC and MPROC and constitutes a
legal, valid and binding obligation of each of Medtronic, MiniMed, MDC and MPROC, enforceable in
accordance with its terms, except as such enforcement may be limited by applicable bankruptcy, insolvency, moratorium or similar laws affecting the rights of creditors’ generally;
|
7.1.3
|
The execution and delivery by each of Medtronic, MiniMed, MDC and MPROC of
this Agreement, the consummation of the transactions
contemplated hereby and the performance by Medtronic, MiniMed, MDC and MPROC of their respective
obligations hereunder, including, without limitation, the grant of the Insulet License, will not conflict with, violate or constitute a breach of, or constitute a default under, any agreement, instrument, judgment, order or requirement of law or governmental rule to which Medtronic, MiniMed, MDC or MPROC is presently a party or by which any of them is presently bound;
|
7.1.4
|
MiniMed is the sole owner of the MiniMed Claims covered by the Insulet License, and such claims are free and clear of all liens, claims, encumbrances, and interests of any kind that would have the effect of waiving or diminishing the Insulet License; and
|
7.1.5
|
None of Medtronic, MiniMed, MDC or MPROC has taken or omitted to take any action which would have the effect of waiving or diminishing the Insulet License.
|
7.2
|
Insulet hereby represents and warrants as follows:
|
7.2.1
|
Insulet is a corporation validly existing and in good standing under the laws of Delaware and Insulet has all requisite power and authority to enter into this Agreement, to grant the Medtronic License, to otherwise carry out the transactions and perform its obligations as contemplated hereby;
|
7.2.2
|
This Agreement has been duly authorized, executed and delivered by Insulet and constitutes a legal, valid and binding obligation of Insulet enforceable in accordance with its terms,
except as such enforcement may be limited by applicable bankruptcy, insolvency, moratorium or similar laws affecting the rights of creditors’ generally;
|
7.2.3
|
The execution and delivery by Insulet of
this Agreement, the consummation of the transactions
contemplated hereby and the performance by Insulet of its
obligations hereunder, including, without limitation, the grant of the Medtronic License will not conflict with, violate or constitute a breach of, or constitute a default under, any agreement, instrument, judgment, order or requirement of law or governmental rule to which Insulet is presently a party or by which it is presently bound;
|
7.2.4
|
Insulet is the sole owner of the Insulet Claims covered by the Medtronic License, and such claims are free and clear of all liens, claims, encumbrances, and interests of any kind that would have the effect of waiving or diminishing the Medtronic License; and
|
7.2.5
|
Insulet has not taken or omitted to take any action which would have the effect of waiving or diminishing the Medtronic License.
|
8.
|
MAINTENANCE AND ENFORCEMENT OF LICENSED PATENTS
|
9.
|
CONFIDENTIALITY
|
10.
|
DISPUTE RESOLUTION
|
11.
|
RELEASES
|
12.
|
MISCELLANEOUS
|
If to Medtronic:
|
Medtronic MiniMed, Inc.
|
Copy to:
|
Medtronic Inc.
|
If to Insulet:
|
Insulet Corporation
|
Copy to:
|
Insulet Corporation
|
|
|
/s/ Duane DeSisto
|
Duane DeSisto
|
President and Chief Executive Officer
|
|
|
/s/ Brian Roberts
|
Brian Roberts
|
Chief Financial Officer
|
|
/s/ Duane DeSisto
|
Name: Duane DeSisto
|
Title: President and Chief Executive Officer
|
|
Date: November 7, 2013
|
|
/s/ Brian Roberts
|
Name: Brian Roberts
|
Title: Chief Financial Officer
|
|
Date: November 7, 2013
|