On January 19, 2012, The Spectranetics Corporation entered into a termination and mutual release with Medtronic, Inc. The agreement terminates the license agreement between the company and Medtronic dated February 28, 1997. The parties disputed whether royalties were owed under the License Agreement. As a result of that dispute, the company stopped making royalty payments in August 2011. Under the agreement, the company will pay to Medtronic $3.0 million on or before January 31, 2012 in settlement of all obligations under the license agreement, and neither party will have any further rights or obligations under the license agreement after the Effective Date, including certain Medtronic rights that if exercised would have been unfavorable to the company. The company had accrued royalty expenses in the amount of $1.2 million related to the License Agreement prior to the settlement; therefore, the amount of $1.8 million will be recorded as a license agreement termination charge in the company's financial statements for the quarter ending December 31, 2011. The agreement also includes a mutual release pursuant to which each of the Company and Medtronic releases the other from all claims, whether known or unknown, arising under the license agreement. The patents underlying the license agreement were scheduled to expire in October 2013 and October 2014 in the U.S. and select foreign jurisdictions, respectively. Royalty expenses paid or accrued pursuant to the license agreement for the year ended December 31, 2011 were approximately $1.5 million. Royalty expenses will not be incurred subsequent to the Effective Date of the agreement.