Benzinga | Jan 5, 2022 04:06PM EST

Myomo Reports Amendment To Chinese Joint Venture

Receipt of Full License Fee and Technology Transfer Expected to Begin before March 31, 2022

BOSTON--(BUSINESS WIRE)-- Myomo, Inc. (NYSE:MYO) ("Myomo" or the "Company"), a wearable medical robotics company that offers increased functionality for those suffering from neurological disorders and upper limb paralysis, announces the entry into an amended and restated joint venture agreement (the "Amended JV Agreement") with Beijing Ryzur Medical Investment Co., Ltd. ("Ryzur Medical") and Wuxi Chinaleaf Rehabilitation Industry Equity Investment Fund ("Chinaleaf"), and the signing of a Technology License Agreement and a Trademark License Agreement with Jiangxi Myomo Medical Assistive Appliance Co., Ltd. (the "JV Company"). The Amended JV Agreement, the Technology License Agreement and the Trademark License Agreement are each effective December 29, 2021 (the "Effective Date"). The original Joint Venture Agreement was entered into on January 21, 2021.

Under the Amended JV Agreement, Myomo will continue to own a 19.9% stake in the JV Company. Ryzur Medical will have a 65.1% ownership stake and Chinaleaf 15%. Among other provisions, the Amended JV Agreement provides for certain rights for Ryzur Medical as majority shareholder and fixes the per-unit price at which the JV Company will purchase MyoPro Control System units as part of its guaranteed annual minimum payment obligation, which remains unchanged at a minimum of $10.75 million in total over 10 years.

Under the Technology License Agreement, the JV Company is licensing Myomo's intellectual property for an upfront license fee of $2.7 million, of which $0.2 million (the "Initial Payment") is payable within 30 days of the Effective Date, and the remaining $2.5 million is payable within 30 days of Myomo's capital contribution of $0.2 million to the JV Company, which is expected to be made immediately following receipt of the Initial Payment. The technology transfer to the JV Company will begin after receipt of the full license fee, which is expected before the end of the first quarter of 2022.

"With a thoughtful business plan to address the China market and the funding commitment by Chinaleaf, we are pleased that the JV Company is ready to commence operations," said Paul R. Gudonis, Chairman and CEO of Myomo. "We are looking forward to the full funding of the JV Company and receipt of the license fee so that we may begin the transfer of our life-changing technology and enable the JV Company to serve patients suffering with upper extremity paralysis in greater China, including Taiwan, Hong Kong and Macau."