PATENT LICENSE AGREEMENT
This Patent License Agreement (the "AGREEMENT") is entered into by and between
Integral Technologies, Inc., a Nevada corporation located at 000 Xxxx Xxxxxxx
Xxxxxx, #0, Xxxxxxxxxx, XX 00000 ("INTEGRAL") and Jasper Rubber Products, Inc.,
an Indiana corporation with offices at 000- Xxxxx Xxxxxx, Xxxxxx, XX 00000
("JASPER") and is effective as of August 25, 2006 (the "EFFECTIVE DATE").
WHEREAS, Integral is the owner of certain technology, generally characterized as
ElectriPlast technology;
WHEREAS, particular applications of the technology are covered by certain patent
rights defined below and those patent rights are owned by Integral; and
WHEREAS, Jasper wishes to obtain a non-exclusive license under such patents to
develop, manufacture, and sell certain products.
NOW, THEREFORE, in consideration of the promises and of the mutual covenants and
agreements herein contained, receipt and sufficiency of which is hereby
acknowledged, the Parties hereby agree as follows:
1. DEFINITIONS.
1.1. "CONFIDENTIAL INFORMATION" means all non-public information
regarding the Disclosing Party or its business activities, including without
limitation (i) its sublicensees, manufacturers, contractors, or sales, (ii) any
non-public information disclosed in any report provided under this Agreement,
(iii) the Documentation and any other information disclosed during any
consulting services; (v) the terms of this Agreement; and (v) any information
disclosed by Jasper pursuant to Section 3.
1.2. "LICENSED FIELD" means the manufacture and sale of Products for
use in home appliances manufactured and sold by the entities listed in the
attached Exhibit A
----------
1.3. "LICENSED PRODUCT" means any Product made, used, sold, or
otherwise disposed of by or for Jasper that (i) uses the Raw Materials and (ii)
is either branded with a Jasper brand or is designed by Jasper and sold in
Jasper's ordinary course of business. Licensed Products do not include "private
label" Products or other products sold without a designation that Jasper is the
source of the Product.
1.4. "LICENSED PATENTS" means the (i) patents, provisional patent
applications, and utility patent applications set forth in Exhibit B; (ii) any
---------
divisions, continuations, continuations-in-part, reissues, or re-examinations of
such patents and patent applications; (iii) all foreign counterparts of the
foregoing (i) and (ii); and (iv) all applications for any of the foregoing (i)
through (iii). Licensed Patents do not include any patent claim that has either
expired or been held invalid or unenforceable by a decision of a court or
governmental agency of competent jurisdiction, which decision is unappealable or
unappealed within the time allowed for an appeal, or any other patent or patent
application.
1.5. "PRODUCT" means any product (i) the manufacture, use, sale, offer
for sale, or import of which is covered by at least one claim of the Licensed
Patents; or (ii) produced by a process, the practice of which is covered by at
least one claim of the Licensed Patents.
1.6. "RAW MATERIALS" means the Technology, as Integral provides it to
Jasper, on a per weight basis for use in manufacturing Licensed Products.
1.7. "TECHNOLOGY" means Integral's proprietary ElectriPlast(TM)
technology, portions of which may be covered by the Licensed Patents. The
Technology is a compounded, pelletized formulation of resin-based materials,
which are conductively loaded or doped with a proprietary controlled, balanced
concentration of micron conductive materials contained within the manufactured
pellet. The conductive loading or doping within this pellet is then homogenized
using conventional molding techniques and conventional molding equipment. The
resulting polymer is electrically conductive.
1.8. "THIRD PARTY" means corporate entities or individuals other than
Integral or Jasper.
INTEGRAL PROPRIETARY AND CONFIDENTIAL
PAGE 1 OF 14
2. CONSULTING SERVICES.
Integral will provide Jasper with consulting services related to the Technology
at Integral's standard hourly rates for such consulting services, on a date and
at a location mutually agreeable to the Parties. If Jasper requests that all or
part of the consulting services take place at facilities other than Integral's
place of business, Jasper will reimburse Integral for its reasonable and actual
meals, travel, and lodging expenses incurred as a result of providing such
consulting services. Integral may, but is not obligated to, provide Jasper with
certain pre-existing or developed written materials as part of the consulting
services ("DOCUMENTATION"), provided that in no event shall any Documentation be
deemed a "work made for hire" or any ownership rights in the Documentation be
assigned to Jasper. By way of clarification, Integral's rights in the
Technology under U.S. patent application numbers not listed on Exhibit B are not
licensed under this Agreement, except as otherwise covered under the Licensed
Patents. Documentation shall be treated as Confidential Information.
3. LICENSE GRANTS.
3.1. To Jasper. Integral grants to Jasper a non-exclusive,
----------
non-sublicensable, non-assignable, worldwide license under all of Integral's
rights under the Licensed Patents to (i) make, use, offer to sell, sell or
import Licensed Products in the Licensed Field; and (ii) internally use the
Documentation and information provided solely for purposes of developing and
manufacturing Licensed Products in the Licensed Field.
3.2. No Foundry Rights. Without limiting the restrictions on "private
------------------
labeling" as provided in Section 1.2 above, Section 3.1 shall not be interpreted
as granting any rights to Jasper to manufacture Third Party Products, wherein
such products are designed by the Third Party without substantial input of
Jasper and such products are essentially sold only to that designing Third
Party.
3.3. Ownership. Except as expressly set forth in this Agreement,
----------
nothing in this Agreement shall be construed as a grant of any license or rights
by implication or estoppel and Integral retains all right, title and interest in
and to the Licensed Patents. All rights not expressly granted by Integral
hereunder are reserved and retained by Integral, including but not limited to
Integral's rights in the Technology not covered by the Licensed Patents.
3.4. New Joint Developments. All technology, information and
------------------------
inventions ("New Developments"), whether or not patentable, developed jointly by
Integral and Jasper that concern the Technology (including the manufacture or
formulation of the Raw Materials) shall be the exclusive property of Integral.
[All New Developments, whether or not patentable, developed jointly by Integral
and Jasper that concern the design or manufacture of fabricated products made
using the Raw Materials shall be the exclusive property of Jasper; provided that
Jasper shall have no rights in the Technology or Licensed Patents except as
provided pursuant to the delivery of Raw Materials by Integral. ]All other New
Developments jointly developed by the Parties under this Agreement shall be
[jointly owned by the Parties;] provided that Jasper shall have no rights in the
Technology or Licensed Patents except as provided pursuant to the delivery of
Raw Materials by Integral. The Parties agree to discuss in good faith whether
and how to jointly prosecute or enforce any patents based on jointly owned New
Developments in a mutually agreed fashion. Neither Party shall be obligated to
pay the other any royalties or other consideration, nor account to the other for
any royalties or other consideration it may receive, for any licenses,
assignment, sale, lease or other distribution of the jointly owned New
Developments or any derivative technology thereof. Any such derivative
technology made after the termination or expiration of this Agreement shall be
owned exclusively by the creator of such derivative technology. Additionally,
regardless of subject matter, all New Developments discovered or developed by
one Party without the participation of the other Party shall become the sole
property of the discovering or developing Party; provided that Jasper shall have
no rights in the Technology or Licensed Patents except as provided pursuant to
the delivery of Raw Materials by Integral.
INTEGRAL PROPRIETARY AND CONFIDENTIAL
PAGE 2 OF 14
4. CONSIDERATION.
Upon execution of this Agreement, Jasper shall pay Integral a non-refundable fee
of One U.S. Dollar ($1.00).
5. RAW MATERIALS FEES.
The Parties agree to use good faith efforts to reach agreement on commercially
reasonable terms for the pricing and delivery of the Raw Materials to Jasper by
Integral, and that agreement regarding the pricing and delivery of Raw Materials
shall be memorialized as an amendment to this Agreement.
6. ENFORCEMENT OF PATENT RIGHTS.
6.1. Notice; Enforcement. In the event that Jasper becomes aware of
--------------------
actual or threatened infringement of the Patent Rights by a Third Party
involving Licensed Products, Jasper shall promptly notify Integral in writing.
Integral may, at its discretion, take corrective action against the Third Party,
and may identify Jasper as having rights under the Licensed Patents. Integral
shall not name Jasper as a co-party in any such action without an express
written request from Jasper.
6.2. Infringement Action. In the event Integral brings an infringement
-------------------
action against a Third Party, such action shall be at no cost to Jasper unless
Jasper joins the suit as a co-party, and any recovery shall go solely to
Integral. Jasper is under no obligation to join any such action and Integral
must approve the addition of Jasper as a co-party.
7. TERM AND TERMINATION.
7.1. Term. This Agreement shall be in full force and effect from the
----
Effective Date and shall remain in effect until the expiration of the last
patent contemplated to be licensed by this Agreement, or until otherwise
terminated pursuant to the terms and conditions of this Agreement.
7.2. Termination. Jasper may terminate this Agreement upon thirty (30)
-----------
days' written notice at any time. Either Party may terminate this Agreement
immediately upon written notice at any time if the other Party is in material
breach of any material warranty, term or condition of this Agreement and has
failed to cure that breach within thirty (30) days after written notice thereof.
Integral may terminate this Agreement upon written notice in the event (i)
Jasper institutes any action or proceeding in which it claims that any Licensed
Patent is invalid or unenforceable; or (ii) Jasper institutes any action
(including by counter or cross-claim) alleging that Integral infringes any
Jasper patent and/or patent application. The terminating Party will incur no
liability to the other Party for damages of any kind resulting solely from
terminating this Agreement in accordance with its terms.
7.3. Effect of Expiration or Termination. Upon expiration or
---------------------------------------
termination of this Agreement, (i) Jasper shall pay all sums accrued hereunder
prior to such termination, (ii) Integral shall have the right to retain any sums
already paid by Jasper for this license and for any Raw Materials delivered or
created for Jasper prior to expiration or termination, and (iii) Jasper shall
return or certify in writing that it has destroyed all Documentation. Upon the
termination of this Agreement, Jasper shall have the right to use or sell all
Licensed Product on-hand at the time of such termination, provided that Jasper
shall be obliged to pay Integral a royalty on use or such sales as set forth in
this Agreement.
7.4. Survival. In the event of expiration or termination of this
--------
Agreement for any reason, the following sections will survive such termination
or expiration: 1, 3.4, 7.4, and 8 - 11.
8. WARRANTIES, REPRESENTATIONS, AND COVENANTS; DISCLAIMER.
8.1. Mutual Representations and Warranties. Each Party represents,
----------------------------------------
warrants, and covenants that: (i) this Agreement has been duly and validly
executed and delivered by such Party and constitutes a legal and binding
obligation of such Party, enforceable against it in accordance with its terms;
(ii) such Party has all necessary power and authority to execute and perform in
accordance with this Agreement; and (iii) such Party's execution, delivery and
performance of this Agreement will not conflict with or violate any
INTEGRAL PROPRIETARY AND CONFIDENTIAL
PAGE 3 OF 14
provision of law, rule or regulation to which it is subject, or any agreement or
other obligation directly or indirectly applicable to such Party or binding upon
its assets.
8.2. Representations and Warranties of Integral. Integral represents
--------------------------------------------
and warrants that (i) it has the lawful right to grant the license set forth
herein; and (ii) as of the Effective Date, the Licensed Patents listed in
Exhibit A are issued, unexpired, valid according to the U.S. Patent and
Trademark Office and in good standing.
8.3. Representations, Warranties, and Covenants of Jasper. Jasper
---------------------------------------------------------
warrants that it has and will have throughout the Term the lawful right to grant
the licenses contemplated herein.
8.4. WARRANTY DISCLAIMER. EXCEPT AS PROVIDED IN SECTIONS 8.1, AND 8.2
--------------------
ABOVE, INTEGRAL EXPRESSLY DISCLAIMS ALL WARRANTIES, EXPRESS, IMPLIED OR
STATUTORY, INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NONINFRINGEMENT, ALL WITH
RESPECT TO THE PATENTS, DOCUMENTATION, AND ANY OTHER MATERIALS OR INTELLECTUAL
PROVIDED OR LICENSED UNDER THIS AGREEMENT. IN ADDITION, NOTHING IN THIS
AGREEMENT SHALL BE CONSTRUED AS (I) A WARRANTY OR REPRESENTATION BY INTEGRAL OF
THE VALIDITY OR SCOPE OF ANY OF THE LICENSED PATENTS; (II) A WARRANTY OR
REPRESENTATION THAT ANYTHING MADE, USED, SOLD OFFERED FOR SALE, IMPORTED, OR
OTHERWISE DISPOSED OF UNDER ANY LICENSE GRANTED IN THIS AGREEMENT IS OR SHALL BE
FREE FROM INFRINGEMENT OF PATENTS OR PROPRIETARY RIGHTS OF THIRD PARTIES; OR
(III) AN AGREEMENT BY INTEGRAL TO BRING OR PROSECUTE ACTIONS OR SUITS AGAINST
THIRD PARTIES FOR INFRINGEMENT OF THE PATENT RIGHTS.
9. INDEMNIFICATION.
Each Party (the "INDEMNIFYING PARTY") will indemnify, hold harmless, and defend
the other Party (the "INDEMNIFIED PARTY") and its subsidiary and parent
entities, successors, affiliates, and assigns, and all of their respective
officers, directors, members, stockholders, agents, employees, and attorneys,
from any and all actions, causes of action, suits, proceedings, claims, demands,
judgments, bona fide settlements, penalties, damages, losses, liabilities,
costs, and expenses (including without limitation reasonable attorneys' fees and
costs and those necessary to interpret or enforce this Section 9) arising out of
or relating to any claim or allegation arising out of (i) the Indemnifying
Party's breach of this Agreement, including without limitation the warranties
set forth in Section 8 above; or (ii) in the case where Jasper is the
Indemnifying Party, the manufacture, use, or sale of any Licensed Product,
including, but not limited to any damages, losses or liabilities whatsoever with
respect to death or injury to any person and damage to any property arising from
the possession, use or operation of the Licensed Product by Jasper or their
customers in any manner whatsoever; except to the extent that the claim results
from Integral's infringement of the intellectual property rights of any third
party. The Indemnified Party may, at its expense, employ separate counsel to
monitor and participate in the defense of any claim that the Indemnifying Party
is defending under this Section. The Indemnified Party will provide the
Indemnifying Party with reasonably prompt notice in writing of any claim to
which this Section relates.
10. CONFIDENTIALITY.
A Party receiving Confidential Information (the "RECEIVING PARTY") of the other
Party (the "DISCLOSING PARTY") shall not disclose or make any use of any of the
Disclosing Party's Confidential Information except expressly as authorized in
writing by the Disclosing Party. Authorized uses include use related to the
implementation of this Agreement. The Receiving Party agrees to take all steps
reasonably requested by the Disclosing Party to confirm and protect the
Disclosing Party's interests in the Confidential Information. For purposes of
clarification, Confidential Information shall not include information that the
Receiving Party can establish by written evidence: (i) entered or subsequently
enters the public domain
INTEGRAL PROPRIETARY AND CONFIDENTIAL
PAGE 4 OF 14
without the Receiving Party's breach of any obligation owed the Disclosing
Party; (ii) became known to the Receiving Party prior to the Disclosing Party's
disclosure of such information to the Receiving Party; (iii) became known to the
Receiving Party from a source other than the Disclosing Party other than by the
breach of an obligation of confidentiality owed to the Disclosing Party; or (iv)
is independently developed by the Receiving Party without reference to any of
the Disclosing Party's Confidential Information.
11. GENERAL.
11.1. Notices. All notices, requests, consents, approvals, or
-------
authorizations in connection with this Agreement: (i) must be given in writing;
and (ii) will be deemed given as of (a) the day they are delivered on paper by a
nationally recognized express delivery service (such as Federal Express or DHL),
addressed as set forth below; or (b) three (3) days after they are deposited in
the sender's national mail system, postage prepaid, certified or registered,
return receipt requested, and addressed as follows:
To Integral: 000 Xxxx Xxxxxxx Xxxxxx, #0, Xxxxxxxxxx, XX 00000,
-------------
Attn: Xxxxxxx Xxxxxxxx
To Jasper: 0000 Xxxxx Xxxxxx, Xxxxxx, XX 00000-0000 Attn: Xxxxxxx
-----------
Xxxxxxx
Either Party may change the address above by giving notice to the
other Party pursuant to this Section 11.1.
11.2. Assignment. Integral may assign this Agreement or its rights and
----------
duties under this Agreement, but Jasper may not undertake any assignment of this
Agreement or any of its rights and duties under this Agreement without
Integral's prior written consent. However, Jasper may assign this Agreement
without Integral's prior written consent as part of a merger, or a sale or
transfer of all or substantially all of its assets, provided such merger or sale
is not with or to a competitor of Integral. Any attempted assignment by Jasper
of this Agreement or all or part of its rights and/or obligations under this
Agreement without Integral's prior written consent (except as provided by the
prior sentence) will be voidable at Integral's option. This Agreement will bind
each Party's heirs and personal representatives, and inure to the benefit of
each Party and its successors, heirs and/or personal assigns.
11.3. Dispute Resolution. This Agreement will be governed by and
-------------------
construed in accordance with the laws of the State of Washington as such laws
apply to contracts performed within Washington by its residents. Any cause of
action concerning this contract shall be brought in the state court located in
Whatcom County, Washington, or the federal court located in the Western District
of Washington, and Jasper consents to the exclusive jurisdiction of such courts.
In any action to enforce any right or remedy under this Agreement or to
interpret any provision of this Agreement, the prevailing Party will be entitled
to recover its costs, including attorneys' fees.
11.4. No Joint Venture. Nothing in this Agreement will be construed to
----------------
mean that any Party is appointed or in any way authorized to act as an agent of
any other Party. This Agreement does not create any joint venture, partnership
or formal business entity or organization of any kind.
11.5. Waiver. No waiver of any provision of this Agreement will be
------
effective unless it is in a signed writing, and no such waiver will constitute a
waiver of any other provision(s) or of the same provision on another occasion.
11.6. Severability. If a court of competent jurisdiction holds any
------------
term, covenant or restriction of this Agreement to be illegal, invalid or
unenforceable, in whole or in part, the Parties agree to negotiate in good faith
to create an appropriate amendment to the remaining terms, covenants and
provisions that will replicate the economic effect of the Parties' intentions
under this Agreement.
11.7. Injunctive and Equitable Relief. Each Party acknowledges and
----------------------------------
agrees that monetary damages may not be a sufficient remedy for a breach of the
terms of this Agreement respecting Confidential Information, and that such
breach will cause the owner of that Confidential Information immediate and
irreparable injury. In such cases, the non-breaching Party will be entitled,
without waiving or prejudicing any other rights or remedies, to injunctive or
equitable relief.
INTEGRAL PROPRIETARY AND CONFIDENTIAL
PAGE 5 OF 14
11.8. Entire Agreement; Amendments. This Agreement is not an offer by
-----------------------------
Integral and it is not effective until signed by both Parties. This Agreement,
including the Exhibits attached hereto which are incorporated by this reference,
constitutes the entire agreement between the Parties with respect to the subject
matter hereof and merges all prior and contemporaneous communications and
proposals, whether electronic, oral or written, between the Parties with respect
to such subject matter. This Agreement may not be modified except by a written
agreement dated subsequent to the date of this Agreement and signed by duly
authorized representatives of Integral and Jasper.
IN WITNESS WHEREOF, both Integral and Jasper have executed this Agreement, in
duplicate originals by their respective officers hereunto duly authorized.
--------------------------------------------------------------------------------
INTEGRAL TECHNOLOGIES, INC. JASPER RUBBER PRODUCTS, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx
Title: CEO Title: President and CEO
Date: August 24, 2006 Date: August 24, 2006
--------------------------------------------------------------------------------
Before me, a Notary Public, in and for the County and State, personally
appeared the within named Xxxxxxx X. Xxxxxxx, President and CEO of JSPER RUBBER
PORDUCTS, INC., and Xxxxxxx Xxxxxxxx, Chairman & CEO or INTEGRAL TECHNOLOGIES,
INC., who acknowledged the execution of the foregoing Patent License Agreement
to be their voluntary act and deed and to be the voluntary act and deed of said
corporation.
WITNESS my hand and Notarial Seal this 24 day of August, 2006.
----
/s/ Xxxxxxx X. Xxxxxxxx
(Xxxxxxx X. Xxxxxxxx) - Notary Public
My Commission Expires: Oct 19, 2007 My County of Residence is: Xxxxxx
STATE OF INDIANA )
) SS:
COUNTY OF XXXXXX )
INTEGRAL PROPRIETARY AND CONFIDENTIAL
PAGE 6 OF 14
EXHIBIT A
CUSTOMERS IN THE LICENSED FIELD
[to be provided by Jasper]
INTEGRAL PROPRIETARY AND CONFIDENTIAL
PAGE 7 OF 14
EXHIBIT B
LICENSED PATENTS AND PATENT APPLICATIONS
[to be provided by Integral]
INTEGRAL PROPRIETARY AND CONFIDENTIAL
PAGE 8 OF 14
