EXHIBIT 2(a): Marine Jet Technology License Agreement
Marine Jet Technology License Agreement
Introduction.
This License Agreement (the "Agreement") is made between Xxxx
X. Xxxxxx of 0000 00xx Xxxxxx XX, Xxxxxx Xxxxxx, Xxxxxxxxxx 00000
and Xxxxxx X. Xxxxxxxxx of 0000 Xxxxxx Xxx XX, Xxxxxxxxxx Xxxxxx,
Xxxxxxxxxx 00000 (referred to as "Licensors") and Marine Jet
Technology Corp., a Nevada Corporation, 000 X. Xxxxxxx Xxxx., Xxx
Xxxxx, Xxxxxx 00000 (referred to as "Licensee").
Licensors and Licensee shall be collectively referred to as
"the parties." Licensors are the owners of certain proprietary
rights to an invention referred to as An Improved Marine Jet
Propulsion System. Licensee desires to license certain rights in
the invention. Therefore the parties agree as follows:
The Property.
The Property is defined as the inventions described in U.S.
Patent Nos. 5,658,176; 5,679,035; and 5,683,276; and any
improvements, reissues or extensions, as well as any continuations,
divisions, or substitute U.S. patent applications that shall be
based on the patents; and any patent applications corresponding to
the above-described patents and patent applications that are
issued, filed or to be filed in any and all foreign countries.
Licensed Products.
Licensed Products are defined as any Marine Jet Propulsion
Systems for use with motors of 400 horsepower and below, or boats
incorporating such propulsion systems, sold by the licensee that
incorporate the Property.
Grant of Rights.
Licensors grant to Licensee an exclusive license to make, use
and sell the Property solely in association with the manufacture,
sale, use, promotion or distribution of the Licensed Products.
Page 1 of 10
Sublicense.
Licensee may sublicense the rights granted pursuant tot his
agreement without the consent of the Licensors, provided that each
sub-licensees agrees to all of the other terms and conditions of
this agreement.
Reservation of Rights.
Licensors expressly reserve all rights other than those being
conveyed or granted in this Agreement, and specifically reserve the
rights to all applications for use in combination with motors in
excess of 400 horsepower.
Territory.
The rights granted to Licensee are not limited as to
territory.
Term.
This Agreement shall commence upon the Effective Date and
shall continue until terminated pursuant to a provision of this
Agreement.
Patent Maintenance.
Licensee shall maintain the all patents and patent
applications subject to this License by prompt payment of all
patent maintenance fees and expenses related thereto in the United
States and in all foreign countries. Licensee also agrees to
defend against such claims of challenges which may be brought by
third parties relating to the validity or scope of said patents and
patent applications. Licensor(s) shall provide all reasonable
assistance and information at their disposal and within their
knowledge to assist Licensee in such maintenance and defense.
Licensee shall be responsible for all patent maintenance fees for
the duration of this agreement.
License Fee.
As a fee for executing this license, Licensee agrees to issue
to Licensors upon execution of this Agreement a total of 15,875,000
shares of common stock in Marine Jet Technology Corp., a Nevada
Corporation, in the following amounts: 14,287,500 shares to Xxxx X
Xxxxxx and 1,587,500 to Xxxxxx X. Xxxxxxxxx.
Page 2 of 10
Licensors Warranties.
Licensors warrant that they have the power and authority to enter
into this Agreement and have no knowledge as to any third party
claims regarding the proprietary rights in this Property, which
would interfere with the rights granted under this Agreement.
Licensor(s) make no other representation or warranty with respect
to the Property and Patents other that expressly stated in this
License Agreement.
Licensee Warranties.
Licensee warrants that its will use its best commercial
efforts to manufacture, promote distribute and sell the Licensed
Products whether through the direct action of Licensee, its agents
or sub-licenses as permitted hereunder.
Indemnification by Licensee.
Licensee shall indemnify Licensors and hold Licensors harmless
from any damages and liabilities (including reasonable attorneys'
fees and costs) (a) arising from any breach of Licensee's
warranties and representations as defined in the Licensee
Warranties, above, (b) arising out of any alleged defects or
failures to perform of the Licensed Products or any product
liability claims or use of the Licensed Products; (c) any claims
arising out of advertising, distribution or marketing of the
Licensed Products; "; and, (d) any claims by Licensee's sub-
licensees, agents or other parties for contract liability or
otherwise arising during the course of, or upon the termination of,
this Agreement."
Intellectual Property Protection.
Licensors may, but are not obliged to seek, in their own
name(s) and at their own expense, additional patent, trademark or
copyright protection for the Property. Licensors make no warranty
with respect to the validity of any patent, trademark or copyright,
which may be granted. Licensors grant to Licensee the right to
apply for patents on the Property or Licensed Products provided
that such patents shall be applied for in the name of Xxxx X.
Xxxxxx and licensed to Licensee during the Term and according to
the conditions of this
Page 3 of 10
Agreement. Licensee shall be responsible for the costs incurred in
the pursuit of intellectual property rights that Licensee elects to
pursue.
Compliance with Intellectual Property Laws.
The license granted in this Agreement is conditioned on
Licensee's compliance with the provisions of the intellectual
property laws of the United States and any foreign county in the
Territory. All copies of the Licensed Product as well as all
promotional material shall bear appropriate proprietary notices.
Infringement Against Third Parties.
In the event that either party learns of imitations or
infringements of the Property or Licensed Products, that party
shall notify the other in writing of the infringements or
imitations. Licensee shall have the right to commence lawsuits
against third persons arising from infringement of the Property or
Licensed Products. In the event that Licensee does not commence a
lawsuit against an alleged infringer within sixty days of
notification by Licensors, Licensors may commence a lawsuit against
the third party. Any recovery (including, but not limited to a
judgment, settlement or licensing agreement included as resolution
of an infringement dispute) shall be divided equally between the
parties after deduction and payment of reasonable attorneys' fees
to the party bringing the lawsuit.
Exploitation.
Licensee agrees to manufacture, distribute and sell the
Licensed Products, or to cause the Licensed Products to be
manufactured, distributed and sold, in commercially reasonable
quantities during the term of this Agreement and to commence such
manufacture, distribution and sale within the following time
period: two years. This is a material provision of this Agreement.
Insurance.
Licensee shall, throughout the Term, obtain and maintain, at
its own expense, standard product liability insurance coverage,
naming Licensors as additional named insureds. Such policy shall:
(a) be maintained with a carrier having a Xxxxx'x rating of at
Page 4 of 10
Leaset B; and (b) provide protection against any claims, demands
and causes of action arising out of any alleged defects or failure
to perform of the Licensed Products or any use of the Licensed
Products. The amount of coverage shall be a minimum of ten million
US dollars with no deductible amount for each single occurrence for
bodily injury or property damage. The policy shall provide for
notice to the Agent and Licensors from the insurer by Registered or
Certified Mail in the event of any modification or termination of
insurance. Licensee shall furnish Licensors and Agent a
certificate from its product liability insurance carrier evidencing
insurance coverage in favor of Licensors, and in no event shall
Licensee distribute the Licensed Products before the receipt by the
Licensors of evidence of insurance. The provisions of this section
shall survive termination for three years.
Confidentiality.
The parties acknowledge that each may by furnished or have
access to confidential information that relates to each other's
business (the "Confidential Information"). In the event that
Information is in written form, the disclosing party shall label or
stamp the materials with the word "Confidential" or some similar
warning. In the event that Confidential Information is transmitted
orally, the disclosing party shall promptly provide a written
statement indicating that such oral communication constituted
Information. The parties agree to maintain the Confidential
Information in strictest confidence for the sole and exclusive
benefit of the other party and to restrict access to such
Confidential Information to persons bound by this Agreement, only
on a need-to-know basis. Neither party, without prior written
approval of the other, shall use or otherwise disclose to others,
or permit the use by other of the Confidential Information.
Licensors' Right to Terminate.
Licensors' shall have the right to terminate this Agreement
for any material breach of the terms of this agreement and
particularly for the following reasons:
(a) Licensee fails in its Warranty obligation.
(b) Licensee fails to introduce the product to market by June 30,
2002.
Page 5 of 10
(c) Licensee fails to maintain confidentiality regarding
Licensors' trade secrets and other information; or
(d) Licensee fails to maintain or obtain product liability
insurance as required by the provisions of this Agreement.
Effect of Termination.
After the termination of this license, all rights granted to
Licensee under this Agreement shall terminate and revert to
Licensors, and Licensee will refrain from further manufacturing,
copying, marketing, distribution, or use of any Licensed Product or
other product which incorporates the Property. Within thirty days
after termination, Licensee shall deliver to Licensors a statement
indicating the number and description of the Licensed Products,
which it had on hand or is in the process of manufacturing as of
the termination date. Licensee, may dispose of the Licensed
Products covered by this Agreement for a period of three months
after termination or expiration except that Licensee shall have no
such right in the event this agreement is terminated according to
the Licensors' Right to Terminate, above. Upon termination,
Licensee shall deliver to Licensors all tooling and molds used in
the manufacture of the Licensed Products. Licensors shall bear the
costs of shipping for the tooling and molds.
Survival.
The obligations of the Confidentiality Section above and all
sections below shall survive any termination of this Agreement.
Attorneys' Fees and Expenses.
The prevailing party shall have the right to collect from the
other party its reasonable costs and necessary disbursements and
attorneys' fees incurred in enforcing this Agreement.
Dispute Resolution.
The Parties agree that every dispute or difference between
them, arising under this Agreement, shall be settled first by a
meeting of the Parties attempting to confer and
Page 6 of 10
resolve the dispute in a good faith manner. If the Parties cannot
resolve their dispute after conferring, any Party may require the
other Parties to submit the matter to non-binding mediation,
utilizing the services of an impartial professional mediator
approved by all Parties. If the Parties cannot come to an
agreement following mediation, the Parties agree to submit the
matter to binding arbitration at a location mutually agreeable to
the Parties. The arbitration shall be conducted on a confidential
basis pursuant to the Commercial Arbitration Rules of the American
Arbitration Association. Any decision or award as a result of any
such arbitration proceeding shall include the assessment of costs,
expenses and reasonable attorney's fees and shall include a written
record of the proceedings and a written determination of the
arbitrators. Absent an agreement to the contrary, any such
arbitration shall be conducted by an arbitrator experienced in
intellectual property law. The Parties reserve the right to object
to any individual who shall be employed by or affiliated with a
competing organization or entity. In the event of any such dispute
or difference, either Party may give to the other notice requiring
that the matter be settled by arbitration. An award of arbitration
shall be final and binding on the Parties and may be confirmed in a
court of competent jurisdiction.
Governing Law.
This Agreement shall be governed in accordance with the laws
of the State of Washington.
Jurisdiction.
The parties consent to the exclusive jurisdiction and venue of
the federal and state courts located in King County, Washington in
any action arising out of or related to this Agreement. The
parties waive any other venue to which either party might be
entitled by domicile or otherwise.
Waiver.
The failure to exercise any right provided in this Agreement
shall not be a waiver of prior or subsequent rights.
Page 7 of 10
Invalidity.
If any provision of this Agreement is invalid under applicable
statute or rule of law, it is to be considered omitted and the
remaining provisions of this Agreement shall in no way be affected.
Entire Understanding.
This Agreement expresses the complete understanding of the
parties and supersedes all prior representations, agreements and
understandings, whether written or oral. This Agreement may not be
altered except by a written document signed by both parties.
Notices.
Any notice or communication required or permitted to be given
under this Agreement shall be sufficiently given when received by
certified mail, or sent by facsimile transmission or overnight
courier.
No Joint Venture.
Nothing contained in this Agreement shall be construed to
place the parties in the relationship of agent, employee,
franchisee, officer, partners or joint ventures. Neither party may
create or assume any obligation on behalf of the other.
Assignability.
Licensee may not assign or transfer its rights or obligations
pursuant to this Agreement without the prior written consent of
Licensors. However, no consent is required for an assignment or
transfer that occurs: (a) to an entity in which Licensee owns more
than fifty percent of the assets; or (b) as part of a transfer of
all or substantially all of the assets of Licensee to any party.
Any assignment or transfer in violation of this Section shall be
void.
Each party has signed this Agreement through its authorized
representative. The parties, having read this Agreement, indicate
their consent to the terms and conditions by their signature below.
Page 8 of 10
By: /s/ Xxxx X. Xxxxxx Date: May 22, 2000
Xxxx X. Xxxxxx: ___________________________(Licensor)
By: /s/ Xxxxxx X. Xxxxxxxxx Date: May 22, 2000
Xxxxxx X. Xxxxxxxxx _______________________(Licensor)
By: Marine Jet Technology Corp. Date: May 22, 2000
Licensee by Xxxx X. Xxxxxx: /s/Xxxx X. Xxxxxx (President and
Treasurer)
STATE OF Washington
:ss
COUNTY OF King
On this 22 day of May, 2000, before me, the undersigned Notary
Public in and for said County and State, personally appeared Xxxx
X. Xxxxxx, known to me to be the person described in and who
executed the foregoing instrument, and who acknowledged to me that
he did so freely and voluntarily and for the uses and purposes
therein mentioned.
WITNESS my hand and official seal.
/s/ Micehele
Xxxxxxx
NOTARY PUBLIC in
and for said
COUNTY and STATE.
STATE OF Washington
:ss
COUNTY OF King
Page 9 of 10
On this 22 day of May, 2000, before me, the undersigned Notary
Public in and for said County and State, personally appeared Xxxx
X. Xxxxxx, known to me to be the person described in and who
executed the foregoing instrument, and who acknowledged to me that
he did so freely and voluntarily and for the uses and purposes
therein mentioned.
WITNESS my hand and official seal.
/s/ Micehele
Xxxxxxx
NOTARY PUBLIC in
and for said
COUNTY and STATE.
Page 10 of 10
