DATED NOVEMBER 29, 2005
(1) NEWGEN TECHNOLOGIES INC
(2) NEWGEN FUEL TECHNOLOGIES LTD
TECHNOLOGY LICENCE &
DEVELOPMENT AGREEMENT
CONTENTS
CLAUSE HEADING PAGE
------ ------- ----
1 DEFINITIONS 3
2 LICENCE 4
3 PAYMENT 5
4 COMMUNICATION OF IMPROVEMENTS 6
5 PROMOTION OF SALES 6
6 NON-DISCLOSURE OF INFORMATION 6
7 IMPROVEMENTS TO LICENCED TECHNOLOGY 7
8 REGISTRATION MAINTENANCE AND ENFORCEMENT OF RIGHTS 7
9 THIRD PARTY RESTRICTION 7
10 DURATION OF AGREEMENT 7
11 TERMINATION 8
12 ASSIGMNENT AND SUB-LICENCING 9
13 NO WARRANTY AS TO PATENT OR GOODS 9
14 NOTICES 10
15 SEVERABILITY 11
16 RESERVED RIGHTS 11
17 INDEMNITY BY LICENSOR 11
18 INDEMNITY BY LICENSEE 12
19 GOVERNING LAW AND JURISDICTION 12
SCHEDULE 1 - LICENSOR'S TRADEMARK
SCHEDULE 2 - ANNUAL PERFORMANCE TARGETS
THIS AGREEMENT is made the 29th day of November, 2005 BETWEEN:
1) NEWGEN TECHNOLOGIES INC having its registered office at ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, (▇▇▇▇▇▇▇▇▇, ▇▇, ▇▇▇ ▇▇▇▇▇ ('the Licensor') and
2) NEWGEN FUEL TECHNOLOGIES LTD having its registered office at KSB Law,
▇▇▇▇ ▇▇▇▇▇ ▇-▇▇ ▇▇▇▇▇▇ (▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ) ('the Licensee')
IT IS AGREED as follows:
1 DEFINITIONS
In this Agreement the following expressions shall have the following meanings:
'Business' exploiting technology in the field of
petro-diesel, petrol, biodiesel, biodiesel
mixtures and by-products, ethanol, ethanol
mixtures and by-products, fuel additives;
and, the manufacture, sale and distribution
of products derived therefrom;
'Effective Date' the date of this Agreement;
'Goods Sold' the motor fuel additives manufactured by or
for Licensee or its affiliates, using the
Licensed Technology, sold either as
stand-alone products, or as component
products, in each case as sold by or for
Licensee or its affiliates.
'Infringement Claim' means a claim by any third party alleging
misappropriation or infringement of such
third party's trade secret, patent,
copyright or trademark rights;
'Patents' means Great Britain Patent Applications
(reference numbers ▇▇▇▇▇▇▇▇▇.1, GB0509653.2
and GB0509649.0) filed with the Patent
Office on May 12, 2005.
"Improvements" additional proprietary intellectual
property, including patents; all patents
issued on Patents, and all extensions,
continuations, divisions thereof and, all
Improvements thereon, to the extent owned by
the Licensor, trade secrets, business
methods, processes, know-how and copyrights,
based, solely or primarily, upon, the
Patents and/or Processes or Goods Sold.
'New Technology' all technology, including all patents issued
thereon; all extensions, continuations,
divisions thereof; and, the related
technical information, know-how,
manufacturing techniques, engineering data,
chemical formulae and specifications of
materials produced, developed or acquired by
one or both of the parties in connection
with the Business, BUT EXCLUDING
Improvements;
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'Processes' the processes and methods of working,
current at the date of the License and
relating to, or in respect of, or for the
manufacture of, the Goods Sold;
"Licensed Technology" collectively, the Patents, Licensor's New
Technology, Improvements, Processes and
Technical Knowledge.
'Product Liability Claim' means a claim (whether in contract, tort, or
otherwise) by any third party alleging that
any Goods Sold have caused any destruction
of, or injury (including death) to, property
or persons, or are defective;
'Quarter Days' 31 March, 30 June, 30 September, and 31
December;
'Technical Knowledge' knowledge about the Patents, Improvements,
Licensor's New Technology and Processes and
all technical information, know-how,
manufacturing techniques, engineering data,
chemical formulae, specifications of
materials and other information in the
possession of the Licensor relating to or in
respect of or for use with the Patents, New
Technology, Improvements and Processes and
all or part of which may be necessary to
enable the Licensee to work or practice the
Processes for the manufacture of the Goods
Sold to a standard and quality similar to
the standard and quality of the equivalent
goods manufactured by or for the Licensor
'Territories' means Europe (excluding Germany),
Scandinavia and the Nordic Region, the
Middle East, Pakistan and India, the ASEAN
region (Indonesia, Malaysia, Philippines,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇. Lao People's Democratic Republic,
Burma/Myanmar and Cambodia), and Australia.
'Year' each period of 365 days calculated from the
calendar quarter day following the date on
which the Licensee shall have commenced the
manufacture of the goods for commercial
purposes
2 LICENCE
2.1 The Licensor grants to the Licensee an exclusive license of the
Licensor's right, title and interest in and to the Licensed
Technology in the Territories in order to:(i) commercialize,
manufacture, use, promote, market, sell and distribute any products
or services in connection with the Licensed Technology, (ii)
develop, commercialize, manufacture, use, promote, market, sell and
distribute any products or services in connection with any New
Technology (including Improvements), (iii) develop, commercialize,
manufacture, use, promote, market, sell and distribute Improvements
and (iv) otherwise conduct the Business, in each case, within the
Territories (collectively, the "License").
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2.2 As consideration for the License, the Licensee shall pay to the
Licensor royalties pursuant to the terms of clause 3 of this
Agreement.
3 PAYMENT
The Licensee shall pay to the Licensor as follows:
3.1 On [March] 3rd 2006, and on each March 3rd thereafter the Licensee
shall pay a sum of $US25,000.00 (the "Retainer") to the Licensor for
as long as this Agreement remains in effect. The Retainer will be
adjusted as and when the Licensee grants sub-licenses from the
License, to take account of the increased market size (if any)
expected to be derived from such sub-licensing. Market size will be
determined based on total oil consumption in the market covered by
the sub-license. The retainer will be determined as a ratio of this
oil consumption v. US oil consumption, multiplied by the US retainer
rate of $250,000.
3.2 As long as this Agreement remains in effect, the Licensee shall pay
to the Licensor, on the Quarter Days, a royalty in respect of the
use of the Licensed Technology. Such royalty shall be calculated at
the rate of 0.115% of the Total Gross Turnover (defined below) since
the previous Quarter Day ("Royalties"). The Retainer will be
deducted from the Royalties if and to the extent that the total,
annual Royalties in any one year exceed the Retainer.
3.3 The first payment of Royalties shall be due immediately after the
Licensee has been paid for its first sale of Goods Sold in the
Territories ("First Payment"). All subsequent Royalties shall be
paid on the Quarter Days of each year the first such Quarter Day
being that which falls first after the First Payment. .
3.4 'Total Gross Turnover' means the aggregate price of the Goods Sold
in the relevant period which the Licensee (or any person, firm or
corporation controlling or controlled by the Licensee) actually
receives from its customers including: the cost of manufacturing the
Goods Sold in the Territories and a proportionate allocation of
manufacturing overhead costs, all as determined in accordance with
generally accepted accounting principals, consistently applied, in
the United States ("GAAP") as stated in financial statements to be
prepared by Licensee; transport charges and other delivery costs;
and, taxes of the nature of sales, purchase, excise or other similar
taxes charged upon or included in the selling price or invoice value
to such customers; and before the deduction, by the Licensee, of any
taxes on income, profit or otherwise; and before the deduction of
any currency exchange or bank fees.
3.5 To minimize the exchange rate risk to Licensor, Licensee shall
accrue Royalties in US$ on a monthly basis at the exchange rate (US$
: invoice currency) current on the last business day in the City of
London in each month. Payment on each Quarter Day shall be the
aggregate of such accrued amounts.
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4 IMPROVEMENTS BY LICENSOR OR LICENSEE
4.1 (a) Each of Licensor and Licensee (as the case may be) shall, during
the continuance of this Agreement and at no additional charge to the
other, communicate to the other any Improvements which the Licensor or
Licensee (as the case may be) may acquire, invent, make or discover.
Licensor shall permit the Licensee to use and apply the Licensor's
Improvements within the Territories on an exclusive basis.
(b) To the extent that Improvements belong to the Licensor, such use
and application by Licensee shall be in accordance with the Licence. The
Licensor shall also grant to the Licensee any patent or similar license
which may be necessary to give effect to this clause.
(c) To the extent that Improvements belong to the Licensee, the
Licensor shall receive an exclusive, sub-licensable right and license to
exploit, develop, commercialize, manufacture, use, promote, market, sell
and distribute the Licensee's Improvements throughout the world, other
than in the Territories, at no charge to the Licensor.
4.2 All Improvements made solely or primarily by the Licensor shall be
owned by the Licensor. All Improvements made solely or primarily by the
Licensee shall be owned by the Licensee. All other Improvements shall be
owned jointly by the Licensee and Licensor on terms to be agreed between
themselves on a case-by-case basis and, failing such agreement, on a
simple, royalty-free joint ownership basis.
4.3 The Licensor shall use its reasonable efforts to comply with all
applicable laws relating to Licensee's Improvements. The Licensee shall
pay any prosecution fees and costs and all maintenance taxes, fees and
costs imposed within the Territories relating to the Licensee's
Improvements. The Licensor shall pay any prosecution fees and costs and
all maintenance taxes, fees and costs imposed outside of the Territories
relating to the Licensee's Improvements.
5 PROMOTION OF SALES
The Licensee shall use reasonable endeavours to promote and extend the use and
the sale, in the Territories, of the Goods Sold.
6 NON-DISCLOSURE OF INFORMATION
The Licensee shall hold the Licensed Technology as absolutely secret and shall
not during the continuance of this Agreement or at any time after its expiration
or termination disclose or permit the same to be disclosed to any person, firm
or company save that any part thereof which has entered the public domain other
than by default of the Licensee shall be deemed not to come within the
provisions of this clause.
7 NEW TECHNOLOGY
7.1 New Technology developed or acquired by the Licensee or the Licensor
(as the case may be) shall be promptly disclosed to the Licensor or
the Licensee, as the case may be.
7.2 The Licensee shall make available to the Licensor (and vice versa)
any New Technology. All New Technology acquired solely or primarily
by the Licensor shall be owned by the Licensor. All New Technology
acquired solely or primarily by the Licensee shall be owned by the
Licensee. All other New Technology shall be owned jointly by the
Licensee and Licensor on terms to be agreed between themselves on a
case-by-case basis and, failing such agreement, on a simple,
royalty-free joint ownership basis.
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7.3 For New Technology acquired and/or owned by the Licensee, the
Licensor shall receive an exclusive, sub-licensable right and
license to exploit, develop, commercialize, manufacture, use,
promote, market, sell and distribute the Licensee's New Technology
throughout the world other than in the Territories on the basis of a
fair market royalty value, which value shall be determined in good
faith by the parties. If the parties cannot agree, after 30 business
days of good faith negotiations, as to the fair market value of any
royalty payable under any New Technology license, then they shall
each prepare and submit their own calculation of such fair market
value in writing to an independent financial advisory firm with
expertise in intellectual property valuations (or, if the parties
cannot agree on a single such firm, each party shall select one such
firm and those two firms shall select a third firm, with all three
firms (acting by a majority) to resolve the matter). Such firm (or
firms) shall select one of such two calculations to be the fair
market value, which determination shall be binding on both parties.
The non-prevailing party shall bear all costs and expenses of
retaining such firm (or firms).
7.4 The Licensor shall use its reasonable efforts to comply with all
applicable laws relating to Licensee's New Technology. The Licensee
shall pay any prosecution fees and costs and all maintenance taxes,
fees and costs imposed within the Territories relating to the
Licensee's New Technology. The Licensor shall pay any prosecution
fees and costs and all maintenance taxes, fees and costs imposed
outside of the Territories relating to the New Technology.
8 REGISTRATION MAINTENANCE AND ENFORCEMENT OF RIGHTS
8.1 The Licensor shall comply with all applicable laws relating to the
Licensed Technology and shall pay any prosecution fees and costs and
all maintenance taxes, fees and costs relating to the Licensed
Technology.
8.2 The Licensor shall have the right to participate with the Licensee
in any prosecution, protection or defence, relating to an
infringement of the Licensed Technology.
8.3 The Licensor shall, at its sole expense, use its reasonable efforts,
diligently to prosecute, maintain and renew, in the Territories, all
rights relating to the Licensed Technology and to protect all such
rights from and against infringement by third parties.
8.4 The Licensor shall use its best efforts to obtain and secure all
filings, registrations and applications necessary for protecting,
preserving and/or enforcing the Patents in the Territories (the
"Patent Filings"). All Patent Filings shall be made by the Licensor
in the Licensor's name, to be owned by the Licensor, and shall be
made or filed at the expense of the Licensor. The Licensee shall
take any action reasonably requested at the Licensor's cost and
expense by the Licensor in connection with the Patent Filings
8.5 All filings, registrations and applications necessary for
protecting, preserving, and/or enforcing the Licensee's New
Technology in the Territories shall be made by the Licensee in the
Licensee's name, to be owned by the Licensee, and shall be made or
filed at the expense of the Licensee.
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8.6 The Licensee shall take any action reasonably requested by the
Licensor, at the Licensor's cost and expense in connection with the
Licensee's New Technology filings outside of the Territories.
9 THIRD PARTY RESTRICTION
The parties to this Agreement recognise that the other of them may have entered
into or may enter into agreements with a third party whereby there is a
restriction on disclosing information belonging to such third party, and in any
such case the Licensor or the Licensee as the case may be will endeavour to
obtain the consent of any such third party to disclose such information.
10 DURATION OF AGREEMENT
10.1 This Agreement shall commence on the Effective Date and continue in
effect until terminated as provided for in this Agreement.
10.2 If, within the first two (2) years after the Effective Date, the
Licensee fails to meet the Performance Based Criteria, as defined
below, the License automatically shall become non-exclusive.
10.3 "Performance Based Criteria" shall be limited to the following:
(a) any material, uncured (after notice thereof from the Licensor
and a reasonable opportunity to cure) persistent breach of the
terms of this Agreement by the Licensee; and
(d) the Licensee's failure to meet the annual performance targets,
as set out in Schedule 2, (the "Annual Performance Targets").
The Annual Performance Targets shall be determined in good
faith by the Licensor's Board of Directors and the Licensee's
Board of Directors (jointly, the "Boards") at least 30 days
prior to each successive anniversary of the Effective Date;
provided, that if, after 30 business days of good faith
negotiations, the Boards cannot agree upon the Annual
Performance Target for any specific year, the Annual
Performance Target for that year shall be equal to a value
equivalent to a 5% improvement of the previous year's Annual
Performance Targets.
11 TERMINATION
11.1 The Licensor or Licensee (as the case may be) shall have the right
to terminate this Agreement and all rights and licences granted or
to be granted under it upon the happening of one or more of the
following events:
11.2.1 if the Licensee or Licensor shall become insolvent; or
11.2.2 if the Licensee or Licensor shall go into liquidation whether
compulsory or voluntary except for the purpose of amalgamation
or reconstruction; or
11.2.3 if the Licensor shall commit any material breach of this
Agreement and the covenants on the part of the Licensor
contained in it and shall fail to remedy such breach (if
capable of being remedied) within 28 days after written notice
to the Licensor by the Licensee specifying the nature of the
breach; or
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11.2.4 if the Licensee or Licensor shall have a receiver appointed
of any of its assets or undertaking or any distress, execution
sequestration or other process shall be issued against any
property of the Licensee or Licensor.
11.3 Any such termination shall be without prejudice to the rights of the
Licensor or Licensee (as the case may be) to recover any sums due to
it under this Agreement and to the rights or remedies of either
party in respect of any antecedent breach of this Agreement.
11.4 If the Licensee terminates this Agreement under clause 11.2.3 then,
at its option, the Licensee shall be free to continue to exploit the
Licensed Technology in the Territories on a Royalty-free basis.
12 ASSIGNMENT AND SUB- LICENCING
12.1 Licensee may grant sub-licenses within the Territories, on condition
that it ensures that any sub- Licensee shall be bound by the terms of this
Agreement.
13 NO WARRANTY AS TO PATENT OR GOODS SOLD
13.1 Nothing in this Agreement or the Licence is to be construed as a
representation or warranty that any patent or similar industrial
property right is valid or that manufacture, use, sale, lease or any
other dealing or disposition of any of the Patents, Processes,
Technical Knowledge or Goods Sold made in accordance with them in
whole or in part is not an infringement of any industrial property
right not owned or controlled by the Licensor.
13.2 The Licensor does not warrant that the Patents, Processes or
Technical Knowledge as used by the 1 Licensee will be sufficient for
the manufacture of the Goods Sold by the Licensee so that the same
are manufactured in a condition suitable for the open market.
14 NOTICES
14.1 Any notice or other communication to be given by one party to another
under, or in connection with the matters contemplated by this Agreement shall be
addressed to the recipient and sent to the address or facsimile number of such
other party given in this Agreement for the purpose and marked for the attention
of the person so given or such other address or facsimile number and/or marked
for such other attention as such other party may from time to time specify by
notice given in accordance with this clause to the party giving the relevant
notice or communication to it. In the case of the Company, such details are:
Address: ▇▇▇▇ ▇▇▇▇▇, ▇-▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇
Facsimile Number: ▇▇▇-(▇)-▇▇▇-▇▇▇-▇▇▇▇
For the attention of: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
14.2 In the case of NewGen, such details are:
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇
Facsimile Number: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
For the attention of: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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14.3 Any notice or other communication to be given by any party to any other
party under, or in connection with the matters contemplated by this
Agreement shall be in writing and shall be given by letter delivered by
hand or sent by first class prepaid post (airmail if overseas) or
facsimile, and shall be deemed to have been received:
(A) in the case of delivery by hand, when delivered; or
(B) in the case of airmail post, at the expiration of 48 hours
following the posting; or
(C) in the case of facsimile or electronic data transmission, at
the time of sending (but the sender is under a duty to seek
confirmation of receipt).
14.4 Any notice or other communication not received on a Business Day or
received after 17:00 hours local time on any Business Day in the place of
receipt shall be deemed to be received on the next following Business Day.
15. SEVERABILITY
The provisions of this Agreement shall be deemed separable. Therefore, if any
part of this Agreement is rendered void, invalid or unenforceable, such
rendering shall not affect the validity or enforceability of the remainder of
this Agreement; provided, however, that if the part or parts which are void,
invalid or unenforceable as aforesaid shall substantially impair the value of
this whole Agreement to any party, that party may cancel, and terminate the
Agreement by giving written notice to the other party.
16 RESERVED RIGHTS
The Licensor retains its exclusive rights to use, and to license to others, the
Patents, subject to the Licensee's rights within the Territories set forth in
this Agreement. The Licensee shall at all times retain its exclusive right to
use the New Technology within the Territories.
17. INDEMNITY BY LICENSOR
The Licensor hereby indemnifies and shall defend and hold harmless the Licensee
and its shareholders, directors, officers, employees, agents and affiliates from
and against any and all claims, losses and expenses based on, caused by or
arising as a result of or in connection with any of the following:
(a) Any breach or default under or with respect to any of Licensor's
duties, obligations or representations pursuant to the terms of this
Agreement;
(b) Any negligence, recklessness, wilful or intentional
misrepresentation, misconduct or fraud, or violation of law by
Licensor or its shareholders, directors, officers, employees, agents
or affiliates;
(c) Any Product Liability Claim based on, caused by or arising as a
result of or in connection with the Licensed Technology; and
(d) Any Infringement Claim with respect to the Licensed Technology
The Licensor's obligations shall only apply to claims based on the Licensee's
use of the Licensed Technology as authorized by the Licensor. The Licensor's
indemnification obligations shall not apply to the extent that any claims,
losses or expenses are caused by the Licensee.
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18 INDEMNITY BY LICENSEE
The Licensee hereby indemnifies and shall defend and hold harmless the Licensor
and its shareholders, directors, officers, employees, agents and affiliates from
and against any and all claims, losses and expenses based on, caused by or
arising as a result of or in connection with any of the following:
(a) Any breach or default under or with respect to any of Licensee's
duties, obligations or representations pursuant to the terms of this
Agreement;
(b) Any gross negligence, recklessness, wilful or intentional
misrepresentation, misconduct or fraud, or violation of law by
Licensee or its shareholders, directors, officers, employees, agents
or affiliates;
The Licensee's indemnification obligations shall not apply to the extent that
any claims, losses or expenses are caused by the Licensor.
19 GOVERNING LAW AND JURISDICTION
This Agreement shall be read and construed according to and shall be governed by
the law of England and Wales. The Courts of England shall have exclusive
jurisdiction in relation to any claim, dispute or difference concerning this
Agreement and any matter arising therefrom.
IN WITNESS
Executed as a deed by
NewGen Technologies Inc
acting by two Directors/a /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
Director and the Secretary Director
Print name ▇▇▇▇▇ ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ D'Onofio
Director/Secretary
Print name ▇▇▇▇▇▇▇ D'Onofio
Executed as a deed by
NewGen Fuel Technologies Ltd
acting by two Directors/a /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
Director and the Secretary Director
Print name ▇▇▇▇▇ ▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Director/Secretary
Print name ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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