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EXHIBIT 10(B)(1)
AGREEMENT FOR SALE OF
ZEROS APPROVED LICENSE
This Agreement for Sale of ZEROS Approved License is made at Houston,
Texas as of the 28th day February, 1997 by and between ZEROS USA, Inc.,
hereinafter referred to in this Agreement as "ZEROS;" and ZEROS Piney Creek
Corporation, hereinafter referred to in this Agreement as "ZPCC" or "Licensee."
In consideration of the mutual covenants made in this Agreement and for other
good and valuable consideration, the receipt and sufficiency of which are
acknowledged, ZEROS, and Licensee agree as follows:
RECITALS
1. Legal Status of ZEROS
ZEROS is a Texas corporation duly organized, validly existing, and in good
standing under the laws of said state, with power to own property and carry on
business as contemplated by this Agreement. ZEROS has its principal office and
place of business at 000 Xxxxx Xxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000.
2. Legal Status of Licensee
Licensee is a Mississippi Corporation duly organized, validly existing, and in
good standing under the laws of said state, with power to own property and
carry on business as contemplated by this Agreement. Licensee has its principal
office and place of business at X.X. Xxx 0000, Xxxxx Xxxx, Xxxxxxxxxxx 00000.
3. Business of ZEROS
3.1. ZEROS is the holder of a master license to sell and operate energy
recycling systems using hazardous and non-hazardous toxic wastes.
Said master license was originally obtained from M, Ltd., a Bahamian
corporation not a party to this Agreement.
3.2. ZEROS is engaged in the business of developing business opportunities
related to recycling energy using hazardous and non-hazardous toxic
wastes using ZEROS Bio-Dynarnic technology.
3.3. ZEROS is engaged further in the business of licensing the operation of
energy recycling oxidation systems using ZEROS Bio-Dynamic technology
by others directly or through its licensees.
3.4. ZEROS is engaged further in the business of selling energy recycling
systems using ZEROS Bio-Dynamic technology.
3.5. ZEROS makes available from time to time certain contracts to provide
remediation services which are offered and sold by ZEROS and/or its
licensees for prospective customers.
3.6. All services are offered in connection with and through the use of
various patents, trademarks and trade names and certain related words,
letters, and symbols, hereinafter collectively
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referred to as "proprietary marks;" and in connection with certain
designs of signs, buildings,and logos, hereafter collectively referred
to as "indicia."
4. Desire of Licensee
4.1. Licensee desires to purchase a license from ZEROS to operate one or
more energy recycling oxidation systems using ZEROS Bio-Dynarnic
technology, including the use of any extant patents, proprietary marks
and indicia.
4.2. Licensee desires to purchase a license from ZEROS to sell to others
operating licenses and energy recycling oxidation systems using ZEROS
Bio-Dynamic technology, including the use of any extant patents,
proprietary marks and indicia.
4.3. Licensee desires to derive the benefits of ZEROS' information,
experience, advice, guidance, know-how, and customer goodwill.
GRANT, TERM, AND INITIAL FEE
5. Grant of License
ZEROS, under the authority of the master license originally granted to it by M,
Ltd., grants to Licensee and Licensee hereby accepts from ZEROS the right and
license for the term indicated, on the terms and conditions hereinafter set
forth, and limited to the geographical area indicated in Paragraph 6, below.
5.1. To develop business opportunities related to recycling energy using
hazardous and non-hazardous wastes, including toxic wastes.
5.2. To operate energy recycling oxidation systems using ZEROS Bio-Dynamic
technology and all other extant and available patents, proprietary
marks and indicia.
5.3. To use, in connection with the operation of its own energy recycling
system(s), ZEROS' proprietary marks, indicia and patents.
5.4. To sell to industrial customers, developed either by ZEROS or
Licensee, operating licenses and zero-emission energy recycling
oxidation systems using ZEROS Bio-Dynamic technology under terms and
conditions approved by ZEROS.
5.5. To sell to bio-medical customers, developed either by ZEROS or
Licensee, operating licenses and zero-emission energy recycling
oxidation systems using ZEROS Bio-Dynamic technology under the terms
and conditions approved by ZEROS.
5.6. To use, in connection with specific contracts to sell by and through
ZPCC said zero-emission energy recycling oxidation licenses and
systems using ZEROS Bio-Dynamic technology, and ZEROS' proprietary
marks, and indicia.
5.7. To use for marketing purposes, limited information regarding ZEROS'
patents, subject to ZEROS' approval.
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6. Geographical Area
The geographical area assigned by ZEROS to Licensee shall be
identified as:
The state of Mississippi.
7. Non-Exclusivity of License Rights to Operate
The license granted herein to own and operate an energy recycling system shall
not be exclusive within the geographical area designated in Paragraph 6, above.
Notwithstanding that the license being purchased by Licensee is not exclusive
within the geographical area, Licensee shall have the right to be paid a
commission by ZEROS USA, Inc., more fully described in Paragraph I 1, below,
for any other operating license or energy recycling system sold after the date
of this License Agreement indicated above, to any other entity within
Licensee's geographical area so long as Licensee continues to perform according
to the terms of this contract, subject to the provisions of Paragraph I 0,
hereinbelow.
8. Term
The term of this Agreement and of the right and license herein granted shall
commence on February 28, 1997, and shall continue perpetually unless terminated
in accordance with the terms hereof.
9. License Fee
Licensee will concurrently with the execution of this Agreement pay to ZEROS,
or has agreed to pay to ZEROS upon terms and conditions agreed to by ZEROS and
Licensee, the sum of $2,000,000.00, as the fee for the right and license herein
granted. Said fee shall be deemed fully earned by ZEROS on the execution and
delivery of this Agreement by ZEROS to Licensee. Said fee is in addition to any
and all amounts payable to ZEROS for implementation of any new technology
developed by ZEROS, for additional measuring instruments, computers, special
tools, spare parts, and related transporting equipment, or for any other
reason.
10. Commissions
Licensee shall have a right to be paid the following commissions:
10.1. ten percent of any license fees or permits resulting from sales to
third parties originated by Licensee;
10.2. one percent of the gross income resulting from sales of energy
recycling systems originated by Licensee; and
10.3. ten percent of the shares of stock issued for any corporation formed
for a new licensee referred to ZEROS by licensee within Licensee's
geographical area identified in Paragraph 6, above, for the term
indicated in Paragraph 8, above, and for so long as Licensee continues
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to perform according to the terms of this contract. Said commission
shall be paid by Licensee to ZEROS within thirty days after Licensee
collects any funds from any other party within Licensee's
geographical area. Said commission shall apply only to those
licenses and systems sold through Licensee after the date of this
License Agreement indicated above.
PATENTS, PROPRIETARY MARKS,
INDICIA, AND CONFIDENTIAL INFORMATION
11. Validity and Use of Patent
Licensee hereby acknowledges the validity of ZEROS' patents in the United
States, Canada, Mexico, and any other country bound by applicable,
international agreements, and acknowledges that the same are the sole property
of ZEROS. Licensee shall use the patents only for so long as the right and
license granted herein remain in force, and only in connection with the purpose
of developing business opportunities to operate and/or sell energy recycling
systems and in the manner and for the purposes specified in this Agreement.
Licensee shall not, either during or after the term of this Agreement, do
anything, or aid or assist any other party to do anything, which would infringe
on, harm, impair, or contest the rights claimed by ZEROS in and to any of the
patents.
12. Validity and Use of Proprietary Marks
Licensee hereby acknowledges the validity of the proprietary marks and
acknowledges that the same are the sole property of the ZEROS. The Licensee
shall use the proprietary marks only for so long as the right and license
granted herein remain in force, and only in connection with the purpose of
developing business opportunities to operate and/or sell energy recycling
systems and in the manner and for the purposes specified in this Agreement.
Licensee shall not, either during or after the term of this Agreement, do
anything, or aid or assist any other party to do anything, which would infringe
on, harm, impair, or contest the rights claimed by ZEROS in and to any of the
proprietary rights.
13. Validity and Use of Indicia
Licensee acknowledges the validity of the indicia and that the same are the
exclusive property of ZEROS. Licensee shall not, either during or after the
term of this Agreement, utilize any of the indicia except in accordance with
the terms of this Agreement.
14. Confidential Nature of ZEROS' System
14.1. Licensee hereby acknowledges that ZEROS is the sole owner of all
patents and proprietary rights in and to the zero-emissions, energy
recycling oxidation system (hereinafter "ZEROS"), to the obtaining
and performance of contracts for the utilization of said system, and
to all material and information now or hereafter revealed to
Licensee under this Agreement relating to ZEROS.
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14.2. Licensee acknowledges that ZEROS in its entirety constitutes trade
secrets of ZEROS which are revealed to Licensee solely to enable
Licensee to develop business opportunities to operate and/or sell
energy recycling systems. Such trade secrets include, but are not
limited to, product catalogues, price lists, training manuals,
policy manuals, sales promotion aids, business forms, accounting
procedures, marketing reports, informational bulletins, and
inventory systems.
14.3. Licensee agrees that both during and after the term of this
Agreement:
14.3.1. Licensee will not reveal any of such trade secrets to any
other person, firm, or entity, and will take all reasonable
steps to prevent any other person, firm, or entity from
discovering the trade secrets.
14.3.2. Licensee will not use the trade secrets in connection with
any business or venture whatsoever, except for the purpose
of developing business opportunities to operate and/or sell
energy recycling systems pursuant to the terms of this and
other related contracts.
15. Goodwill
ZEROS acknowledges that all goodwill which may arise from Licensee's use of the
patents, proprietary marks, the indicia, the trade secrets, or the license or
ZEROS' system of operation within the designated geographical area only is and
shall at all times hereinafter be the sole and exclusive property of Licensee
and shall inure to the sole benefit of Licensee.
OBLIGATIONS OF ZEROS
16. Initial Obligation
ZEROS agrees to sell to Licensee a license and related rights within the
geographical area designated in Paragraph 6, above, for the operation and/or
sale of energy recycling systems known as ZEROS.
17. Training Program
ZEROS agrees to instruct Licensee in all aspects of owning and operating the
systems by providing a training program for Licensee and such of its management
and supervisory personnel as Licensee may reasonably designate.
18. Improvements in System
ZEROS agrees to make available for a fee to Licensee all improvements and
additions to the system to the same extent and in the same manner as they would
have been implemented by ZEROS if it were operating the system.
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19. Management and Operation Assistance
ZEROS agrees to counsel and to assist Licensee on a continuing basis with
respect to the management and operation of the system, and will make available
to Licensee the benefits of ZEROS' information, experience, advice, and
knowledge.
20. Advertising
Licensee may from time to time purchase and place advertising promoting ZEROS
and the services provided and furnished by it. All decisions regarding whether
to utilize national, regional, or local advertising, or some combination
thereof, and regarding selection of the particular media, as well as
advertising content, shall be within the sole discretion of ZEROS.
21. Sale of ZEROS Units by Licensee
21.1. Licensee shall have the right to sell individual ZEROS units to
third parties during the term of this Agreement and subject to the
terms hereinafter set forth.
21.2. The prices, delivery terms, terms of payment, and other terms
relating to the sale of such ZEROS units by Licensee to third
parties shall be determined at ZEROS' sole discretion.
22. Payment of Royalties
Licensee agrees to pay as a royalty for the benefit of ZEROS 15% of the gross
income generated by the use of its own ZEROS units during the stated term.
23. Definition of Gross Income
For the purposes of Paragraph 22, above, "gross income" is defined as all
income generated from tipping fees at the input station and from the sale of
all products produced by each ZEROS unit operated by licensee before deducting
operating expenses and taxes.
24. Reports and Records
24.1. Licensee shall submit to Grantor each month a true and correct
accounting providing a statement of total gross income generated
from each ZEROS unit on forms provided by ZEROS containing all
information called for by such forms and certified to by Licensee.
24.2. Within sixty days after the close of Licensee's fiscal year,
Licensee shall finish a statement, on forms provided by ZEROS,
showing the total gross income for said preceding fiscal year, as
finally adjusted and reconciled after the closing and review of
Licensee's books and records for such fiscal year. If such statement
discloses that less gross income was generated than what the ZEROS
recorded and was paid for such fiscal year, Licensee shall
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pay to ZEROS at the time of submitting such statement the amount of
any such underpayment. Any overpayment shall be credited by ZEROS to
Licensee's account.
24.3. Licensee shall maintain its books and records in such manner as to
clearly and accurately reflect the total gross income generated by
the various ZEROS units. All books and records shall be preserved
for a period of not less than five years after the close of the
Licensee's fiscal year to which they relate.
25. ZEROS' Right to Inspect Instruments, Books and Records
All instruments, books and records maintained by Licensee relating to operation
of the various ZEROS units shall be open at all reasonable times to inspection
and verification by ZEROS or any of its representatives. ZEROS shall be
entitled at any time to have the Licensee's instruments, books and records
examined or audited at ZEROS' expense, and the Licensee shall cooperate fully
with the party or parties making such examination or audit on behalf of ZEROS.
LICENSEE'S AGREEMENTS WITH
RESPECT TO OPERATION OF ZEROS UNITS
26. General
The ZEROS units are operated most efficiently and economically if they are run
twenty-four hours a day. In that connection, as much as is possible, allowing
reasonable "down-time" for turnarounds, other regular maintenance and repairs,
Licensee must require all ZEROS units Licensee operates or sells to be kept
operating around the clock throughout the year during the term of this
Agreement, and will at all times assure that all ZEROS units are operated
diligently so as to maximize the revenues and profits therefrom.
27. Marketing
Notwithstanding that it is understood that some contracts for utilization of
the ZEROS units will be provided by ZEROS to Licensee, Licensee shall at all
times actively promote the use and sale of ZEROS units and will use his best
efforts to cultivate, develop, and expand the market therefor whenever
possible.
28. Maintenance and Inventory
Licensee agrees that Licensee at all times during the term of this Agreement
maintain an inventory of ZEROS units, subject to reasonable business standards
and judgment, adequate to fulfill the public demand and to promptly satisfy
prospective customers seeking to use his services to recycle energy and dispose
of toxic wastes.
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29. Managerial Responsibility
Licensee agrees that at all times during the term of this Agreement, Licensee
will assure that each operator of a ZEROS unit:
29.1. Shall devote its/his full time and effort to the active management
and operation of their respective ZEROS unit(s).
29.2. Shall reserve and exercise ultimate authority and responsibility
with respect to the management and operation of their respective
various ZEROS unit(s).
30. ZEROS Design and Appearance
Licensee acknowledges that the design and appearance of both the exterior and
interior of any building housing a ZEROS unit is part of the ZEROS' indicia,
subject to modification from time to time by ZEROS, and that it is essential to
the integrity of the system that as great a degree of uniformity as possible be
maintained among the various ZEROS units. Accordingly, Licensee agrees that:
30.1. It will not make any change, or allow any third party or alteration
of any kind to the structural elements of the building housing a
ZEROS unit without the prior written consent of ZEROS.
30.2. It will at its sole expense, or require any third party to at its
sole expense, maintain the interior and exterior painting of the
buildings at the sites where the ZEROS units may be located.
30.3. It will follow, or require any third party to follow, ZEROS'
reasonable instructions with respect to floor layout and character of
equipment layout and interior furnishing.
31. Site Maintenance
Licensee will maintain, or require any third party to maintain, its respective
premises in a clean, wholesome, attractive, and safe condition, and will cause
them to be kept in good maintenance and repair.
32. Standards of Operation
Licensee will at all times give, or require any third party to at all times
give, prompt, courteous, and efficient service to the public, will perform, or
cause to be performed, work competently and in a workmanlike manner, and in all
business dealings with members of the public or the ZEROS will be governed, or
will required any third parties to be governed, by the highest standards of
honesty, integrity, fair dealing, and ethical conduct. Licensee will do
nothing, nor allow any party to do nothing, which would tend to discredit,
dishonor, reflect adversely upon, or in any manner injure the reputation of
ZEROS or Licensee.
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33. Advertising Materials
Licensee will not use, nor allow any third party to use, display, publish,
broadcast, or in any manner disseminate any advertising or promotional material
unless the same has first been approved by ZEROS.
34. Insurance
34.1. Licensee and/or its customers, shall be responsible for all loss or
damage arising out of or relating to the operation of the ZEROS
units or arising out of the acts or omissions or failure to act of
the Licensee, or any of its customers, agents, servants, or
contractors in connection with the rendering of service by Licensee
and/or any of its customers, and for all claims for damage to
property or for injury or death of any person or persons directly or
indirectly resulting therefrom.
34.2. Licensee agrees to indemnify, or cause any third party to indemnify,
and hold ZEROS harmless from and against any and all such claims,
loss, and damage, described in subparagraph 33.1, above, including
costs and reasonable attorney's fees.
34.3. Licensee shall obtain, or cause any third party to obtain, and at
all times during the term of this Agreement maintain in force and
pay the premiums for public liability insurance with complete
operations coverage. Limits of liability for bodily injury shall be
not less than $1,000,000.00 for each injury, $5,000,000.00 for all
injuries in each accident, and of not less than $1,000,000.00 for
property damage in each occurrence. Such limits of liability shall
be increased and modified, or additional types of coverage shall be
obtained by Licensee or any of his customers at their sole cost and
expense at the direction of ZEROS when reasonably required by
changed circumstances.
34.4. The policies of insurance referred to in subparagraph 34.3, above,
shall expressly insure both the Licensee, any of his customers, and
the ZEROS and shall require the insurer to defend both the Licensee
and its customers and the ZEROS in any action based on personal
injury or property damage suffered as a result of or arising out of
the occupancy or operation of a ZEROS unit. The Licensee shall
furnish to the ZEROS a certified copy or certificate with respect to
each such policy, evidencing coverage as set forth above. Such
policies shall not be canceled, amended, or modified except on ten
day's prior written notice to ZEROS.
35. Financial information
In addition to any other reports required of Licensee by this Agreement, the
Licensee shall submit to ZEROS, within ninety days after the end of each fiscal
year of Licensee, complete financial statements in a form prescribed by ZEROS,
including balance sheet, profit and loss statement, and statement of source and
disposition of funds.
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36. Compliance With Laws
Licensee shall comply with all federal, state, county, municipal, or other
statutes, laws, ordinances, regulations, rules, or orders of any governmental
or quasi-governmental entity, body, agency, commission, board, or official
applicable to the operation of any ZEROS unit.
37. Compliance With Policies, Regulations, and Procedures
Licensee shall at all times comply with all lawful and reasonable policies,
regulations, and procedures promulgated or prescribed from time to time by
ZEROS in connection with the operation of any ZEROS unit, including but not
limited to, standards, techniques, and procedures in the installation of
equipment or the rendering of services; selection, supervision, and training of
personnel; sales, advertising techniques, programs, and procedures, maintenance
and appearance of any ZEROS sites and premises; and policies and procedures
relating to payment, credit, accounting, and financial reporting policies and
procedures.
38. ZEROS' Right to Inspect ZEROS OPERATING SITE
ZEROS, through its authorized representatives, shall have the right at all
reasonable times, to visit any permanent or temporary site where a ZEROS unit
is being operating for the purpose of inspecting the equipment on hand,
inspecting the nature and quality of services rendered, examining and auditing
Licensee's instruments, books and records, and observing the manner and method
of operating the site.
TRANSFERABILITY
39. General
Except as set forth in Paragraphs 40 through 41, below, and subject to all the
terms and provisions thereof below, Licensee shall not make or permit any
assignment of this Agreement or of any rights or interests herein.
40. Transfer to Controlled Corporation
Licensee may at any time assign and transfer this Agreement to a
corporation organized and operated for the sole purpose of conducting
the business for which the Licensee is authorized and licensed
hereunder, subject to the following conditions:
40.1. Such assignment and transfer shall be evidenced by a written
instrument, satisfactory in form and substance to ZEROS, in which
said corporation expressly assumes all obligations of Licensee
hereunder.
40.2. Licensee shall execute and deliver to ZEROS a guaranty of the
payment of such corporation's debts to ZEROS, if any.
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40.3. Licensee shall remain bound and liable to ZEROS with respect to all
nonmonetary obligations of Licensee under this agreement whether
then accrued or thereafter arising.
41. Consent by ZEROS to Transfer
41.1. Licensee shall not make any sale, assignment, or other transfer of
this Agreement, or any rights or interest herein without first
obtaining the consent of ZEROS.
41.2. Licensee shall notify ZEROS in writing of the proposed sale,
assignment, or transfer, setting forth in detail the nature of the
item or interest to be sold, assigned, transferred, the name and
address of the proposed purchaser, assignee, or transferee, and the
consideration, if any, therefor.
41.3. Subject to prior compliance with the provisions of Paragraph 40,
above, the ZEROS shall consent to the proposed transaction, provided
the following conditions are fulfilled:
41.3.1. It is demonstrated to the reasonable satisfaction of ZEROS
that the proposed purchaser, assignee, or transferee
possesses the business experience and capability, credit
standing, and financial resources necessary to successfully
operate the business in accordance with this Agreement.
41.3.2. The proposed purchaser, assignee, transferee, or person to
assume all the duties and responsibilities outlined in this
Agreement, is approved by ZEROS and successfully completes
the training course offered by ZEROS.
41.3.3. Any sale, assignment, or transfer of this Agreement shall
be evidenced by a written instrument, in form and substance
reasonably satisfactory to ZEROS, in which the purchaser,
assignee, or transferee expressly assumes all obligations
of Licensee hereunder, whether accrued at the time of such
assignment, sale or transfer, or arising thereafter, and
agrees to be bound by all the terms and provisions of this
Agreement to the same extent and in the same manner as the
Licensee.
42. Sale of Business-ZEROS' Right of First Refusal
42.1. In the event Licensee proposes to sell to any party other than a
controlled corporation the business operated pursuant to this
Agreement, Licensee must first submit to ZEROS a copy of any written
offer made or received, or if none, a statement in writing of all
the terms of the proposed sale and identity of the proposed
purchaser.
42.2. ZEROS shall have the irrevocable first right and option to purchase
the business on the same terms as stated in such written offer or
statement. The ZEROS may exercise such right and option by notifying
the Licensee in writing of its election to exercise within fourteen
days after the ZEROS receives the written offer or statement.
42.3. If ZEROS does not so notify Licensee within the fourteen-day period,
the sale to the third party may be consummated, but only on the same
terms and conditions as set forth in the written offer or statement
to ZEROS and only on the Licensee's obtaining ZEROS' consent.
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43. Arbitration
In the event of any dispute from ZEROS' failure or refusal to grant consent to
any sale, assignment, or transfer pursuant to provisions above, such dispute
shall be submitted to arbitration in accordance with the terms and conditions
below.
DEFAULT AND TERMINATION
44. Termination by Licensee
Licensee may terminate this Agreement at any time and without cause by giving
to ZEROS written notice of such termination not less than thirty days prior to
the date of termination.
45. Termination by ZEROS
On the happening of any of the following events, ZEROS may notify the Licensee
in writing of Licensee's default under this Agreement, stating Licensee's
obligation to cure the default, and itemizing the specific steps to be taken by
Licensee. On failure by Licensee to cure such default within thirty days after
receipt of such notice, ZEROS may terminate this Agreement by written notice of
termination to be effective fifteen days after receipt thereof.
44.1. Failure by Licensee to make any payments of money payable and due to
ZEROS pursuant to this Agreement.
44.2. Failure by Licensee to submit to ZEROS when due any reports required
pursuant to this Agreement.
44.3. Failure by Licensee to maintain and operate its operating site(s) in
accordance with good business practices.
44.4. Failure by Licensee to perform any obligations imposed on Licensee
by any provision of this Agreement.
44.5. Willful and material falsification by Licensee of any report,
statement, or other written data furnished to Licensee.
44.6. Willful and repeated deception of customers of Licensee relative to
the nature or quality of services rendered.
45. Arbitration
45.1. In the event ZEROS gives Licensee any notice of default or
termination and Licensee disputes the right of ZEROS to terminate
the Agreement or in the event of any dispute, Licensee may make a
written demand on ZEROS, at any time prior to or within ten days
after Licensee's receipt of notice of termination or the failure or
refusal of ZEROS to grant consent as described in Paragraph 4 1,
above. Such dispute shall be submitted to arbitration in accordance
with the rules and procedures for commercial arbitration of the
American Arbitration Association or any successor organization, and
in accordance with and subject
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to all the provisions of the Uniform Arbitration Act as in force in
the State of Texas. The place of arbitration shall be Houston,
Texas.
45.2. The procedure for selection of the arbitrator shall be as may be
prescribed by said Association or its successor, provided, however,
that if said Association or a successor is not in existence or
does not provide such a procedure, then ZEROS and Licensee shall
each select one arbitrator and said arbitrators shall select a
third.
45.3. The arbitrator or arbitrators shall have full power to determine all
issues of fact and of law necessary to determine whether ZEROS has
the right to terminate the Agreement pursuant to the notice or
notices given, or what, if any, remedy Licensee may be entitled to
due to the failure of refusal of ZEROS as described in Paragraph 41,
above, and the determination of the arbitrators thereon shall be
final and conclusive, and binding on the parties hereto, subject
only to the provisions of the Uniform Arbitration Act. Any such
determination of an issue of fact or law made by the arbitrators,
however, shall be binding on the parties hereto only with respect to
and in connection with the particular arbitration proceeding and the
specific final decision or award of the arbitrators made therein,
and shall not be binding on the parties hereto for any other
purpose.
45.4. The cost of arbitration shall be taxed and borne as provided in the
Uniform Arbitration Act.
45.5. The serving of proper and timely demand for arbitration shall
suspend the running of any period for curing a default or shall
suspend the effectiveness of any termination of this Agreement, as
the case may be, until the decision or award of the arbitrators is
made.
46. Automatic Termination
The Agreement shall terminate immediately on the occurrence of any of the
following events, without the necessity of notice of any kind by either party.
46.1. The termination of Licensee's right to possession of the premises
designated in Paragraph 2, above, subject, however, to the
provisions of Paragraph 48, below.
46.2. The adjudication of Licensee as a Debtor as that term is defined in
the federal Bankruptcy Code, 11 U.S.C., or the filing of any
petition by or against Licensee, under the federal Bankruptcy Code
or the laws of any state or territory relating to relief of debtors,
for reorganization, arrangement, or other similar relief provided
therein, unless such petition filed against Licensee is dismissed
within sixty days.
46.3. The making by Licensee of a general assignment for the benefit of
creditors.
46.4. The appointment of any receiver, trustee, sequestrator, or similar
officer to take charge of Licensee's business, or any attachment,
execution, levy, seizure, or appropriation by any legal process of
Licensee's interest in this Agreement, unless the appointment of
such officer is vacated or discharged or the effect of such legal
process is otherwise released within sixty days.
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47. Relocation of Licensee's Offices
If Licensee's right to possession of the premises designated in Paragraph 2,
above, is terminated, prior to expiration of the terms of this Agreement, and
is without fault or affirmative action on the part of Licensee, then, within
ninety days after Licensee notifies ZEROS that such termination has occurred
or will occur, ZEROS shall propose to Licensee a new location from which
Licensee may maintain its offices for the remainder of the term of this
Agreement.
48. Obligations On or After Termination
On termination of this Agreement, whether by lapse of time, by termination, by
mutual consent of the parties, by operation of law, or in any other manner,
Licensee shall cease to be an official holder of the license to any products or
services of ZEROS, and Licensee and all persons directly or indirectly owning
any interest in Licensee or in any way associated with or related to Licensee
shall:
48.1. Promptly cause Licensee to pay sums owing from Licensee to ZEROS.
48.2. Immediately and permanently discontinue the use of any and all of
the patents, proprietary marks, the trade secrets, the indicia, and
the license of the ZEROS units, of ZEROS.
48.3. Immediately and permanently remove, destroy, or obliterate, at
Licensee's expense, all signs containing any of ZEROS' proprietary
marks or indicia.
48.4. Promptly destroy or surrender to ZEROS all stationery, letterheads,
forms, printed matter, promotional displays, and advertising
containing any of the patents, proprietary marks or indicia of
ZEROS.
48.5. Immediately and permanently discontinue all advertising placed by
Licensee as an authorized license holder.
48.6. Sell to ZEROS all or such part of any ZEROS unit(s) on hand as of
the date of termination as ZEROS may request in writing.
48.7. Thereafter refrain from doing anything tending to indicate that
Licensee is or was a license holder, or is or was in any way
associated with ZEROS.
49. General Provisions Regarding Termination
49.1. Termination of this Agreement under any circumstances shall not
abrogate, impair, release, or extinguish any debt, obligation, or
liability of Licensee to ZEROS which may have accrued hereunder.
49.2. All covenants and agreements of Licensee which by their terms or by
reasonable implication are to be performed, in whole or in part,
after the termination of this Agreement, shall survive such
termination, including but not limited to, Licensee's obligation to
maintain the secrecy and confidentiality of the patents and trade
secrets.
Page 14 of 16
15
MISCELLANEOUS PROVISIONS
50. Licensee Not Agent of ZEROS
The Agreement does not in any way create the relationship of principal and
agent between ZEROS and Licensee, and in no circumstances shall the Licensee be
considered an agent of ZEROS nor shall ZEROS consider Licensee an agent.
51. Non-Waiver
No failure by ZEROS to take action on account of any default by Licensee,
whether in a single instance or repeatedly, shall constitute a waiver of any
such default or of the performance required of Licensee.
52. Invalidity
If any provision of this Agreement shall be invalid or unenforceable, such
provision shall be deemed modified in scope or application to the extent
necessary to render the same valid or shall be excised from this Agreement as
the situation may require, and this Agreement shall be construed and enforced
as if such provision had been included herein as so modified in scope or
application or as if such provision had not been included herein.
53. Notices
Any notice or demand given or made pursuant to the terms of the Agreement shall
be deemed to be properly given when deposited in the United States mail,
registered or certified, postage prepaid, addressed in the following manner:
53.1. If given to ZEROS, it shall be addressed to ZEROS' address stated
above, or at such changed address as ZEROS may from time to time
designate.
53.2. If given to Licensee, it shall be addressed to Licensee's address
stated above, or at such changed address as Licensee may from time
to time designate.
54. Entire Agreement
This written Agreement contains the entire agreement between the parties. There
are merged herein all prior and collateral representations, promises, and
conditions in connection with the subject matter hereof. Any representation,
promise, or condition not incorporated herein shall not be binding on either
party. Any matter not specifically granted by this Agreement, is not available
to Licensee without specific written consent and authorization from ZEROS.
Page 15 of 16
16
55. Cost of Enforcement or Defense
In the event ZEROS is required to employ legal counsel or to incur other
expense to enforce any obligation of Licensee under this Agreement, or to
defend against any claim, demand, action, or proceeding by reason of Licensee's
failure to perform any obligation imposed on Licensee by this Agreement, and
provided that legal action is filed by or against ZEROS and such action or its
settlement establishes Licensee's default under this Agreement, ZEROS shall be
entitled to recover from Licensee the amount of all reasonable attorneys' fees
of such counsel and all other expenses incurred in enforcing such obligation or
in defending against such claim, demand, action, or proceeding.
56. Controlling Law
This Agreement, including all matters relating to its validity, construction,
performance, and enforcement, shall be governed by laws of the State of Texas.
Executed at Houston, Texas, on the day and year first written above.
ZEROS USA, Inc.
/s/ XXXXX XXXXX
--------------------------------------
By: Xxxxx Xxxxx, President
Zeros Piney Creek Corporation
/s/ C. XXX XXXXXX
--------------------------------------
By: C. Xxx Xxxxxx
Page 16 of 16
17
CONTRACT ADDENDUM
ZEROS PINEY CREEK CORPORATION
The undersigned ZEROS approved Permit holder hereby agrees to an amended
Contract Payment schedule on the ZEROS Piney Creek Corporation transaction as
follows:
Contract Payment Date: Amount Due:
February 28, 1998 $ 900,000.00
February 28, 1999 $ 900,000.00
February 28, 2000 $ 900,000.00
--------------
Total: $ 2,700,000.00
The undersigned agrees that all payments are fully earned when paid and are not
refundable.
This agreement shall be effective February 28, 1997 the date concurrent with
the Agreement for the transfer for ZEROS Piney Creek Corporation to the
undersigned.
ZEROS Piney Creek Corporation
By: /s/ C. XXX XXXXXX
--------------------------------
ZERO USA, inc.
By: /s/ XXXXX XXXXX
--------------------------------
18
Confirmation of the Agreement Transactions
ZEROS USA, inc.
Zeros Piney Creek Corporation
July 1, 1997
The undersigned parties hereby acknowledge and confirm the following Agreement
Transaction:
1. That the parties have revised and modified by mutual agreement and
consent in their hand the original agreements and documents for
internal business reasons.
2. That the effective date of the Agreement for the Transfer of the Stock
of ZEROS Piney Creek Corporation by ZEROS USA, inc. to C. Xxx Xxxxxx
is February 28, 1997.
Executed the 1st day of July 1997.
ZEROS USA, inc.
By: /s/ XXXXX XXXXXX
--------------------------------
Zero Piney Creek Corporation
By: /s/ C. XXX XXXXXX
--------------------------------
/s/ C. XXX XXXXXX
------------------------------------
C. Xxx Xxxxxx
