LICENCE AGREEMENT
between
RIGID AIRSHIP HOLDINGS N.V.
SYNFUEL TECHNOLOGY, INC.
IMPERIAL AIRSHIPS N.V.
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TABLE OF CONTENTS
Page
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Article 1. Representations by Rigid 4
Article 2. Representations by SNFL 4
Article 3. License 5
Article 4. Consideration 6
Article 5. Use of the License 7
Article 6. Term 7
Article 7. Accounting and Payments 8
Article 8. No Right to Sublicense 9
Article 9. Infringement 9
Article 10. Improvements 10
Article 11. Confidentiality 11
Article 12. Liability and Indemnification 12
Article 13. Governing Law, Jurisdiction 12
Article 14. Notices 13
Article 15. Covenant of SNFL 14
Article 16. Integration 14
Article 17. Recitals 14
Article 18. Amendments and Waiver 15
Article 19. Severability 15
Article 20. Assignability 15
Article 21. Limitations 15
Article 22. Successors and Assigns 16
Article 23. Independent Contractor 16
Article 24. Further Assurances 16
Article 25. Counterparts 17
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LICENSE AGREEMENT
The undersigned:
1. RIGID AIRSHIP HOLDINGS N.V. ("RIGID"), a company organized under the
laws of The Netherlands Antilles, having its registered office in
Curacao, N.A. at Xxxxxxxxxxx 00, and
2. SYNFUEL TECHNOLOGY INC. ("SNFL"), a company organized under the laws of
the State of Nevada USA, having its registered office in Salt Lake
City, Utah, United States of North America,
3. IMPERIAL AIRSHIPS N.V. ("IA"), a company organized under the laws of
The Netherlands Antilles, and having office in Willemstad, Curacao,
Netherlands Antilles on the Garipitoweg 9,
parties 1, 2 and 3 jointly and individually referred to as "PARTIES" and
"PARTY";
WHEREAS:
A. Rigid has bought a concept for the design, construction and development
of airships (jointly the "AIRSHIPS" and individually an "AIRSHIP"), the
design which is a hydrocarbon powered LTA vehicle, having a fabric
covered structure comprised of longitudinal girders and polygonal
transverse frames having control surfaces situated at the rear and
having its unpressurised lifting gas content divided into separate
cellular units (hereinafter referred to as the "RIGID AIRSHIP
CONCEPT");
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B. SNFL desires to obtain from Rigid the exclusive right (the "EXCLUSIVE
RIGHT") to exploit the Rigid Airship Concept within the United States
of North America ("USA");
C. In this license agreement (the "AGREEMENT") Parties wish to agree on
the terms and conditions under which SNFL is granted the Exclusive
Right,
HAVE AGREED AS FOLLOWS:
ARTICLE 1. REPRESENTATIONS BY RIGID
Rigid represents that:
a. it has the right to enter into this Agreement;
b. it has executed no other agreements which conflict herewith and has not
granted any other person or entity any right, license or privilege with
respect to Rigid Airship Concept which conflicts with any rights
granted hereunder; and
c. it is in a position to enter into and perform this Agreement without
any conflicts of interest or interference from any other commitments.
ARTICLE 2. REPRESENTATIONS BY SNFL
SNFL represents that:
a. it has the right to enter into this Agreement;
b. it will devote sufficient time and effort to the exploitation of the
Exclusive Right granted hereunder; and
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c. it is in a position to enter into and perform this Agreement without
any conflicts of interest or interference from any other commitments.
ARTICLE 3. LICENSE
3.1 This Agreement grants SNFL the Exclusive Right to
i. exploit (such as but not limited to construction, production,
marketing, sale, trade, rent, lease and/or operation) the Rigid Airship
Concept;
ii. utilize the (intellectual property) rights and know how with respect to
the Rigid Airship concept (such as but not limited to copyrights,
patent rights, design rights (whether registered or not) and all
relevant documentation and information) provided by Rigid to SNFL for
the purpose of the exploitation of the Rigid Airship Concept.
3.2 SNFL is allowed to construct, produce and/or have constructed and/or
have produced Airships on the basis of the Rigid Airship Concept in the
USA. SNFL shall construct and produce and/or have constructed and have
produced at least 4 (four) Airships on the basis of the Rigid Airship
Concept per year, starting two years from the date mentioned in article
5 of this Agreement.
3.3 Rigid will provide and/or will have provided by third parties to SNFL
pilot training, technical training, technical support, complete design
and specification manuals as well as operating manuals upon mutually
agreeable (financial) terms.
3.4 Rigid will do its best efforts to obtain a certification of
airworthiness for the Airship and if necessary, assist SNFL to obtain
such certification in the USA. If any (additional) certification in the
USA is necessary, it will be the sole responsibility of SNFL to obtain
such certification.
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ARTICLE 4. CONSIDERATION
4.1 As consideration for the Exclusive Right from the date hereof SNFL
shall pay to IA a royalty fee of two percent (2%) and to Rigid a
royalty fee of one percent (1%) (I) of the realized turnover (sales) as
the result of the sale of an Airship in the event that SNFL sells an
Airship to a third party or (ii) of the selling/market value of an
Airship in the event SNFL will not sell such airship and will use such
Airship itself or will lease, rent to third parties or otherwise
exploit the Airship (iii) any and all revenues generated on a yearly
basis with any other exploitation of the Rigid Airship Concept.
4.2 In addition SNFL agrees to purchase from Rigid Airship Design N.V. in
Holland two Airships to be constructed by Rigid Airship Design N.V. for
a purchase price (the"PURCHASE PRICE") of NLG 120,000,000. -- (one
hundred and twenty million Netherlands Guilders), which respective
purchase prices shall be paid as described in article 2.2 of the Sale
and Purchase Agreement.
4.3 Rigid Airship Design N.V. will use its best efforts to complete the two
Airships to be purchased by SNFL within two years after Rigid Airship
Design N.V. has obtained the certification of airworthiness of the
competent airworthiness authority with regard to the first prototype of
an Airship.
4.4 SNFL shall pay US$1,000,000. -- (one million US dollars) and issue to
Rigid 26,000,000 (twenty-six million) common shares and 20,000,000
(twenty million) preferred shares.
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ARTICLE 5. USE OF THE LICENSE
SNFL shall not in any way make use of the License on or before the date on which
Rigid has formally and in writing notified SNFL that it can collect the first of
the Airships to be constructed for SNFL.
ARTICLE 6. TERM
6.1 This Agreement and the Exclusive Right granted hereunder shall remain
in effect for (15) fifteen years from the date hereof and thereafter
may be extended for an additional (15) fifteen years term upon the
mutual agreement of the Parties. Notwithstanding anything to the
contrary, Rigid may terminate this Agreement and by doing so terminate
the Exclusive Right immediately upon written notice to SNFL:
a. if any payment due on the basis of this Agreement or the Sale and
Purchase Agreement between SNFL and Rigid Airship Design N.V. is not
made when due, provided however, that SNFL shall have 20 (twenty) days
from the giving of written notice of such default to cure such default;
b. if SNFL defaults in its performance of any term or condition of this
Agreement and the default is not cured with thirty (30) days, after
notice is given to SNFL;
c. if SNFL is adjudged bankrupt, declared insolvent, files a petition of
voluntary or involuntary bankruptcy, enters into an assignment of
assets for the benefit of creditors, or has a receiver appointed; or,
d. if SNFL shall at any time cease to carry on a material part of its
existing business or becomes subject to the direct or indirect control
of any third party or group of parties other than those at present
controlling it, which is in competition (whether direct or otherwise)
with Rigid;
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e. if SNFL does not act in accordance with and/or violates treaties, laws,
regulations, directives applicable in the USA and/or any of its States,
including, but not limited to any and all state and federal USA
Securities Laws and Regulations.
f. If Rigid Airship Design N.V. has not received payment of the full
Purchase Price of NLG 120,000,000 (one hundred and twenty million
Netherlands guilders) on or before the date which occurs 30 (thirty)
days upon the date on which Rigid Airship Design N.V. has formally and
in writing notified SNFL that it can collect the second Airship
constructed and to be purchased by SNFL.
6.2 In the event of termination or expiration for what ever reason and
regardless on which ground:
i. SNFL shall return immediately to Rigid all the information and
documentation with regard to the Rigid Airship Concept provided by
Rigid to SNFL and all the other information and documentation SNFL has
obtained as a result of the exploitation of the Rigid Airship Concept;
ii. SNFL shall assign to Rigid all its (intellectual property) rights
(whether registered or not) and know how SNFL has obtained as a result
of the exploitation of the Rigid Airship Concept.
ARTICLE 7. ACCOUNTING AND PAYMENTS
7.1 All royalty fee payments due hereunder to Rigid and IA shall be paid
within 60 (sixty) days after receipt of the (sale) price (turnover)
with respect to the sale of an airship or after putting into use an
airship or any other exploitation of the Rigid Airship Concept.
7.2 SNFL shall make and keep full and accurate accounting books and records
in sufficient detail to enable payments due to Rigid to be determined.
Within thirty days after the end of each fiscal quarter during the term
hereof, a statement of accounting with regard
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to the respective fiscal quarter shall be presented to Rigid signed by
officer of SNFL attesting to the total revenues generated by SNFL from
the exploitation of the Rigid Airship Concept or any portion thereof
and the payment due to Rigid and IA as a result thereof.
7.3 SNFL further agrees that during the term and for five (5) years
thereafter, Rigid and/or it designees shall be permitted, from time to
time but no more than once with respect to each calendar year at
Rigid's expense, to inspect such books and records as contain data
pertinent to the computation of the turnovers and the royalties.
7.4 In the event that after such inspection as referred to in article 9.3
it appears that SNFL has paid less royalty fees than SNFL had to pay
according to its books and records, SNFL shall pay immediately the
outstanding royalty fees and all the costs of Rigid and its designees
with regard to the inspection.
ARTICLE 8. NO RIGHT TO SUBLICENSE
SNFL shall have no rights to sublicense any of the rights granted hereunder.
ARTICLE 9. INFRINGEMENT
9.1 Each party shall promptly notify the other party if it becomes aware of
any infringement or potential infringement of the rights granted
hereunder and of any alleged claim of a third party that the
exploitation of the Rigid Airship Concept infringes upon its rights.
Parties shall thereupon promptly confer together as to what actions are
to be taken to stop or prevent any infringement determined by the
parties hereto to be illegal.
9.2 If Rigid decides to commence proceedings, SNFL shall be notified in
writing and the parties will share equally all reasonable costs,
expenses and attorney's fees associated with such litigation and will
share equally any and all damages recovered.
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9.3 Should Rigid decide not to commence proceedings, SNFL will be permitted
to do so in its own name, provided Rigid is notified in writing. If
Licensee commences such an action, SNFL will bear all costs, expenses
and attorney's fees associated with such litigation. All damages
recovered from such litigation will belong to SNFL, provided that any
damage amount in excess of reasonable costs, expansion and attorneys'
fees will be subject to the royalty provision of paragraph 3 of this
Agreement.
9.4 Rigid and SNFL each at the request of the other, shall assist each
other and cooperate in any action taken, other than direct financial
assistance, against an alleged infringer or potential infringer.
9.5 In the event that a third party claim that the exploitation of the
Rigid Airship Concept infringes and as a result such claim is honored
by a judgment of a Court, Arbitration or in a settlement agreement,
Rigid will exert its best efforts to:
i. obtain a license of the third party;
ii. modify the Rigid Airship Concept in such manner that it does not
infringe upon the rights of the third party; in order to continue the
exploitation of the Rigid Airship Concept by SNFL.
ARTICLE 10. IMPROVEMENTS
10.1 If, during the term of this Agreement, Rigid makes any improvements in
the Rigid Airship Concept or the mode of using the Rigid Airship
Concept, or becomes the owner of any improvement either through patents
or otherwise, then Rigid shall make available to SNFL full information
regarding the improvement and, if additional terms (financial and
otherwise) shall be agreed upon by the parties hereto, such improvement
shall be included in any grant made hereunder.
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10.2 If during the term of this Agreement SNFL makes any improvements or
modifications to the Rigid Airship Concept SNFL will immediately inform
about and provide Rigid full access and technical information regarding
such improvements or modifications and will request the approval of
Rigid prior to implementing such improvements or modifications. If such
modifications or improvements made by SNFL can be protected by
intellectual property rights (such as design rights and patent rights),
SNFL shall apply for registration and/or register for such (design or
patent) rights in due time in the USA with respect to the improvement
or modification. If such application and/or registration is made SNFL
shall inform Rigid immediately by written notice hereof and shall grant
Rigid the right to apply for the registration of and register these
rights on its own name as the rightful owner in all the other countries
in the world, besides the USA.
ARTICLE 11. CONFIDENTIALITY
11.1 All the information and documentation provided by Rigid or by third
parties on the request of Rigid to SNFL shall be considered
confidential, unless Rigid explicitly states otherwise. SNFL will keep
this confidential information strictly confidential as well as all the
information, documentation and know how with regard to the
(modifications and improvements) of the Rigid Airship concept SNFL will
obtain.
11.2 SNFL ensures that its staff concerned with the exploitation of the
Rigid Airship concept, its subcontractors and their employees are aware
of and observe the provisions of this clause, both during the existence
of this License Agreement and thereafter.
ARTICLE 12. LIABILITY AND INDEMNIFICATION
12.1 Rigid's liability towards SNFL for damages as a result of non
compliance with the terms and conditions of this agreement are limited:
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i. to direct damages in a year; and,
ii. to a maximum amount per year, regardless whether suffered as a result
of one or more breaches, equal to the amount paid by SNFL as royalty
fee to Rigid in that respective year.
12.2 SNFL indemnifies, defends and holds harmless Rigid, Rigid's officers,
directors, subcontractors, related parties and employees against all
third party claims and expenses, including costs resulting from the
law, fees for lawyers, which result from the exploitation of the Rigid
Airship Concept by SNFL.
ARTICLE 13. GOVERNING LAW, JURISDICTION
This Agreement shall be governed by and construed in accordance with the laws of
the Netherlands Antilles. The parties consent to the jurisdiction of the
competent court in the Netherlands Antilles for the resolution of all disputes
arising out of this Agreement or the negotiations thereof, notwithstanding the
right of Rigid to institute proceedings (summary proceedings for injunctive
relief) against SNFL in any state of the USA.
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ARTICLE 14. NOTICES
Any notices or other communications required or permitted hereunder to be
effective shall be in writing and shall be deemed to have been duly given or
made when personally delivered or, in the case of registered or certified mail,
postage prepaid, two or three days after being sent, or, in the case of
overnight courier or prepaid telegram, one business day after being sent by such
overnight delivery service or by prepaid telegram, addressed in each case as
follows:
If to Rigid: Xxxxxxxxxxx 00
Xxxxxxxxxx, Xxxxxxx
Xxxxxxxxxxx Antilles
fax: 00 0000 000 0000
If to SNFL: Salt Lake City, Utah
U.S.A.
If to IA: Xxxxxxxxxxx 0
Xxxxxxxxxx, Xxxxxxx
Xxxxxxxxxxx Antilles
fax: 00 0000 000 0000
Any party may change its address for the purpose of the Agreement by giving
written notice thereof to the other parties.
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ARTICLE 15. COVENANT OF SNFL
a. SNFL agrees to xxxx permanently all documents utilized in its business
hereunder as being marketed or sold by it under this Agreement; and
b. SNFL agrees to comply with conditions and requirements set forth in
writing from time to time by Rigid with respect to the usage of the
Rigid names, the Rigid marks, service marks, if any; and,
c. SNFL agrees that all of its exploitation (construction, marketing and
sales) efforts hereunder shall be of the highest quality and character
and that SNFL will diligently pursue its exploitation of the rights
granted hereunder.
ARTICLE 16. INTEGRATION
This Agreement contains the entire agreement among the parties with respect to
the subject matter hereof, superseding all prior agreements, whether oral or
written, between the parties hereto with respect to such subject matter.
ARTICLE 17. RECITALS
Each recital hereof is a material part of this Agreement, is incorporated herein
and is a material inducement to the parties entering into this Agreement.
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ARTICLE 18. AMENDMENTS AND WAIVERS
This Agreement may be amended, or any provision of this Agreement may be waived,
provided that no such amendment or waiver shall be valid unless set forth in a
writing executed by the parties hereto or, in the case of a waiver, by the party
waiving such provision. The waiver by any party of a breach of any provision of
this Agreement shall not operate or be construed as a waiver of any other
breach.
ARTICLE 19. SEVERABILITY
If any one or more or any portion of the provisions of this Agreement is deemed
to be invalid or unenforceable in any respect for any reason, the parties shall
negotiate in good faith to revise the terms of this Agreement to adjust for the
invalidity or unenforceability of such provisions and the validity and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
ARTICLE 20. ASSIGNABILITY
The rights granted hereunder shall not be assignable by SNFL.
ARTICLE 21. LIMITATIONS
The License shall apply to Rigid Airships built by SNFL within the Continental
United States of America.
a. The License will not be assignable to third parties.
b. All liabilities, direct or consequential, incurred by airships
constructed by SNFL shall be borne exclusively by SNFL.
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ARTICLE 22. SUCCESSORS AND ASSIGNS
This Agreement and the rights and obligations hereunder shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns.
ARTICLE 23. INDEPENDENT CONTRACTOR
The Parties to this Agreement recognize and agree that each is operating under
this Agreement as an independent contractor and not as an agent, distributor, or
representative of the other. Nothing contained in this Agreement shall be deemed
to constitute the parties as a partnership or joint venture with each other or
any person or entity, and neither party may be bound by the other to any
contract, arrangement or understanding except as specifically stated herein.
ARTICLE 24. FURTHER ASSURANCES
Subsequent to the date of hereof, each party hereto agrees to take such actions
and to execute and deliver such documents as shall be reasonably necessary to
effectuate the purposes of this Agreement.
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ARTICLE 25. COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original but all of which together shall constitute one and
the same instrument.
This agreement was signed in threefold on [______] 1998 in [__________]
On behalf of Rigid Airship Holdings N.V.:
-------------------------
(name)
-------------------------
(title)
-------------------------
(signature)
On behalf of SynFuel Technology Inc.:
--------------------------
(name)
--------------------------
(title)
--------------------------
(signature)
On behalf of Imperial Airships N.V.
--------------------------
(name)
--------------------------
(title)
--------------------------
(signature)
