Exhibit 10.7.1
LICENSE AGREEMENT DATED MAY 1, 1995 BETWEEN
THE COMPANY AND TRIANGLE RESEARCH AND DEVELOPMENT CORPORATION
INFORMATION PLACED IN BRACKETS [ ] HAS BEEN
OMITTED IN ACCORDANCE WITH A CONFIDENTIAL
TREATMENT REQUEST PURSUANT TO RULE 406 AND
HAS BEEN FILED SEPARATELY WITH THE COMMISSION
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EXCLUSIVE LICENSE
AGREEMENT
This License Agreement, entered into this 1st day of May, 1995, (referred to as
the ("Agreement") is between:
Triangle Research and Development Corporation, a corporation organized under the
laws of the State of North Carolina, with an address X.X Xxx 00000, Xxxxxxxx
Xxxxxxxx Xxxx, Xxxxx Xxxxxxxx 00000, hereinafter referred to as "TRDC", and
Xxxxxx Technologies, Inc., a corporation organized under the laws of the State
of North Carolina, with its principal place of business at 000 Xxxxx Xxxx
Xxxxxx, Xxxxxxxx, Xxx Xxxx 00000, hereinafter referred to as "Xxxxxx".
RECITALS
WHEREAS, TRDC is a research and development corporation which has developed
patented and proprietary technologies relating to bulk and microencapsulated
phase change materials (hereinafter, "MicroPCMs") and;
WHEREAS, Xxxxxx has the requisite expertise, facilities, capabilities and
personnel to develop and market commercial, industrial and government
applications of innovative technologies; and
WHEREAS, Xxxxxx wishes to exclusively license the MicroPCM technologies of TRDC,
and TRDC desires to grant to Xxxxxx an exclusive license to develop and market
all applications of the MicroPCM Technologies, with the exclusion of fibers and
fabrics with reversible, enhanced thermal storage properties, including, but not
limited to, U.S. Patent Number 4,756,758 (hereinafter "MicroPCM fibers and
fabrics"),
WITNESSETH, in consideration of the premises and covenants herein contained,
receipt of which is hereby acknowledged, and intending to be legally bound
hereby, the parties hereto agree as follows:
ARTICLE I - DEFINITIONS
1.01 MicroPCMs. "MicroPCMs" means bulk and microencapsulated phase change
materials.
1.02 Bulk PCMs. "Bulk PCMs" means bulk phase change materials.
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1.03 Technology. "Technology" means all of TRDC's interest in any proprietary
information, patents, inventions, developments, trade secrets, know-how and,
whether present or future, relating to all applications of MicroPCMs for all
commercial, industrial and government customers worldwide, with the exclusion of
MicroPCM fibers and fabrics.
1.04 End-Use Products. "End-Use Products" means any item containing the
Technology resulting from the Agreement which is presently or may be in the
future a salable product of Xxxxxx.
1.05 Royalty. "Royalty" means [This information has been omitted in accordance
with a Confidential Treatment Request and has been filed separately with the
Commission.]
1.06 Sublicensee Payments. "Sublicensee Payments" means all moneys received by
Xxxxxx from any sublicensees of the Licensed Technology, excluding moneys
received from Option To License Agreements.
1.07 Sales. "Sales" means the gross sales revenues of Xxxxxx products
incorporating the Licensed Technology, less all applicable taxes, commissions
and shipping expenses.
1.08 Effective Date. This Agreement is effective when duly signed, with all
terms and conditions effective retroactively to January 1, 1995.
1.09 Territory. "Territory" means all commercial, industrial and government
markets and customers worldwide.
1.10 TRDC. "TRDC" means Triangle Research and Development Corporation, its
affiliates or any individuals, corporations or other institutions to which TRDC
ownership of the Technology has been transferred or assigned.
ARTICLE II - GRANT OF LICENSE
2.01 TRDC grants to Xxxxxx the exclusive worldwide license to develop and
commercialize all patented and proprietary bulk and MicroPCM technologies of
TRDC, whether present or future, with the exception of MicroPCM fibers and
fabrics. This License includes, but is not limited to U.S. Patent numbers:
US Patent No. 4,807,696 MicroPCM Thermal Energy Storage
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US Patent No. 4,911,232 Heat Transfer Using MicroPCM Slurries
US Patent No. 5,141,079 Two Component Cutting and Cooling Fluids
US Patent No. 5,224,356 Thermal Energy Absorbing and Conducting
Potting Materials
US Patent No. 5,415,222 Microclimate Cooling Garments
US Patent (pending) Moldable Foams with Reversible Enhanced
Thermal Storage
US Patent (pending) Thermal Insulating Coatings Using
MicroPCMs
*US Patent No. 5,366,801 Coated Fabric With Reversible Enhanced
Properties
*US Patent No.5,290,904 Thermally Enhanced Heat Xxxxxxx
(*Note: Xxxxxx'x License for these patents exclude MicroPCM fibers and fabrics)
2.02 TRDC further grants to Xxxxxx the exclusive rights and license with
exclusive rights to sublicense, to manufacture Bulk PCMs, MicroPCMs, end-use
products, and any improvements thereto, and to market, sell, use, lease or
distribute all applications of these product throughout the world, with the
exclusion of MicroPCM fibers and fabrics.
2.03 TRDC agrees that all improvements and new discoveries pertaining to bulk or
MicroPCMs developed by TRDC, with the exception of improvements relating to
MicroPCM fibers and fabrics, will become part of this agreement with the
exclusive license to Xxxxxx granted hereby. This exclusive license agreement
includes all current and future uses of bulk and MicroPCM technologies,
including all non-thermal and electrorheological applications and uses for same.
2.04 Each Party agrees to inform the other Party of any and all improvements,
changes and information relating to Bulk and MicroPCM technologies as soon as
practical after that information is made available to the Party. This includes
the status of all Bulk and MicroPCM related research
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and development efforts by Xxxxxx, TRDC or any affiliates. All improvements,
changes and information shall be promptly incorporated as part of this
Agreement.
ARTICLE III - PAYMENTS
3.01 Payments to TRDC. All amounts owed by Xxxxxx to TRDC in accordance with
section 3.03 herein, shall be paid within thirty days after the end of the
calendar quarter during which payments were received by Xxxxxx from sales or
revenues described in sections 3.031, 3.032, 3.033 and 3.034. Each payment shall
be accompanied by a statement consisting of records sufficient to enable the
verification of amounts payable under this License.
3.03 Royalty Payments. Xxxxxx agrees to pay royalties or fees to TRDC in
accordance with the following terms:
3.031 End-Use Product Sales and Government Development Contracts. On all sales
by Xxxxxx of bulk PCMs, MicroPCMs and End-Use Products incorporating MicroPCMs,
with the exception of those exclusions identified below, which are based upon
the licensed technologies of TRDC, as well as on all direct government
development contracts related to the licensed Technology received by Xxxxxx
during this exclusive license, Xxxxxx agrees to pay TRDC a royalty or fee in
accordance with the following schedule:
[This information has been omitted in accordance with a Confidential Treatment
Request and has been filed separately with the Commission.]
Exclusions: All sales of MicroPCMs by Xxxxxx to Gateway Technologies, Inc. are
excluded from the above provision, in accordance with Par. 3.032 below. In
addition, all MicroPCM sales to any customer, when the MicroPCMs have been
supplied directly by TRDC to Xxxxxx, are excluded from the above royalties or
any associated fees.
0.000 Xxxxxxx Technologies, Inc. Product Sales - On all sales of MicroPCMs to
Gateway Technologies, Inc., Xxxxxx will pay TRDC a royalty of [This information
has been omitted in accordance with a Confidential Treatment Request and has
been filed separately with the Commission.] in lieu of the percentages due in
3.031 above.
3.033 Sublicensee Payments. On all Sublicensee Payments received by Xxxxxx from
third party Sublicencees, Xxxxxx agrees to pay TRDC in accordance with the
following schedule. These payments include all sublicense fees and royalties
received from Xxxxxx licensed third parties, but
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exclude all Option To License fees and any in-kind or other non-cash fees and
payments received from any third parties.
[This information has been omitted in accordance with a Confidential Treatment
Request and has been filed separately with the Commission.]
3.034 License Fees Received From Pre-existing TRDC Third Parties: In lieu of the
royalties payable to TRDC under paragraph 3.033 above, TRDC will receive a
royalty of [This information has been omitted in accordance with a Confidential
Treatment Request and has been filed separately with the Commission.] the
pre-existing TRDC accounts listed in Appendix T which has been attached hereto
and made a part hereof. In addition, if TRDC receives funded research contracts
by June 1, 1996 from Digital Equipment Corp., IBM or Intel Corporation as a
direct result of TRDC research projects proposed and submitted prior to December
15, 1995 to the companies, then the specific product applications developed
under that funded effort of the company will be added to Appendix T.
3.035 Minimum Payments To TRDC - Xxxxxx agrees to a minimum annual payment to
TRDC of the following in accordance with the following yearly amounts. A minimum
payment is only due if the total payments due TRDC from license fees, royalties
or related fees, or R&D credits as described in section 3.036, in each year do
not exceed the minimum amounts shown below for that year.
1st Year $ 15,000.
2nd and 3rd Year $ 30,000.
4th Year $ 54,000.
5th Year $ 78,000.
6th Year $102,000.
7th Year $126,000.
8th and thereafter $150,000.
If the total of royalty payments, fees and R&D credits in a given year do not
meet or exceed the above Minimum Payments, then Xxxxxx will pay TRDC the
difference between those amounts within thirty (30) days after the end of the
calendar year. If the total amounts paid TRDC is equal to or greater than the
above Minimum Payments, then no supplemental payments will be due to TRDC.
3.036 Research and Development Credits Against Annual Minimums - The parties
agree that [This information has
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been omitted in accordance with a Confidential Treatment Request and has been
filed separately with the Commission.] of the contract price of all R&D
contracts accepted by TRDC from Xxxxxx in a given year shall be applied towards
the minimum payment due to TRDC.
ARTICLE IV - INTELLECTUAL PROPERTY
4.01 Intellectual Property. All licensed products sold by TRDC during the term
of this License Agreement shall reference Xxxxxx'x designated Trademarks.
Further, TRDC shall not obtain any Trademarks or use any Tradenames that are
similar thereto on authorized sales of bulk or MicroPCMs to any third parties.
4.02 Patent Expenses. Xxxxxx will pay all applicable patent expenses and filing
fees relating to the Bulk and MicroPCM technologies of TRDC exclusively licensed
to Xxxxxx hereunder, whether present or future, as well as the appropriate
proportion of "shared patents" with other TRDC Licensees. All patent
applications and applicable bills for any patent related legal expenses relating
to the Technology exclusively licensed to Xxxxxx must be approved by Xxxxxx
prior to inclusion as part of this provision.
4.03 Patent Rights. TRDC represents and warrants that, to the best of its
knowledge and belief, the patents licensed herein are valid and enforceable in
the United States, that it is the sole and exclusive owner thereof in the United
States, that it has the full right, power, and authority to enter into this
Agreement and to grant the rights, licenses and privileges hereby granted by
TRDC to Xxxxxx, and to perform all of its obligations hereunder. TRDC also
warrants that, with the exception of MicroPCM fibers and fabrics which have been
licensed to Gateway Technologies, Inc. under a prior License, it has not granted
to any other firm or person any right or license to use the patents in
connection with the sale, use or distribution of the Technologies Licensed to
Xxxxxx under this Agreement.
4.04 Infringement. Each Party shall promptly notify the other Party if it learns
of any infringement of any patent rights respecting the patents or Technology
licensed hereunder or of any unauthorized use of the Technology by any third
party. Both Parties shall take all appropriate actions necessary for the
protection of the patent or license rights granted herein.
ARTICLE V - MISCELLANEOUS PROVISIONS
5.01 Effect of Waiver. No waiver whether express or implied, of any breach of
any term, condition or obligation of this Agreement shall be construed as a
waiver of any subsequent breach of that term, condition or obligation, or any
other term, condition or obligation of this Agreement of the same or different
nature.
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5.02. Notices. Any notice provided for in this Agreement must be in writing and
may be given by registered letter and shall be deemed to have been given when
such registered letter, properly addressed, is mailed. If such notice is given
otherwise than by registered letter, it shall be deemed to have been given when
delivered. If such notice is to be given to Xxxxxx, copies shall be addressed to
Xx. Xxxx Xxxxxx, Chief Executive Officer, Xxxxxx Technologies, Inc., at 000
Xxxxx Xxxx Xxxxxx, Xxxxxxxx, Xxx Xxxx 00000. If given to TRDC, copies shall be
addressed to Dr. Xxxxx Xxxxxx, Ph.D., President, at Triangle Research and
Development Corp., P0 Box 12696, Research Xxxxxxxx Xxxx, Xxxxx Xxxxxxxx 00000.
Any party hereto may at any time, by thirty (30) days written notice to the
others, designate any other address in place of those provided in this
paragraph.
5.03 Severability. It is understood and agreed by the Party to this Agreement
that if any part, term, or provision of this Agreement is held to be
unenforceable by United States courts or in conflict with applicable law, the
validity of the remaining portions or provisions shall not be affected, and the
rights and obligations of the parties hereto shall be construed and enforced
consistent with the intent of this Agreement.
5.04 Successors and Assigns. This Agreement shall inure to the benefit of the
successors or assigns of the Parties.
5.05 Choice of Law. This Agreement is to be governed by and interpreted in
accordance with the laws of the State of North Carolina.
5.06 Complete Agreement. This document comprises the entire Agreement with
respect to the subject matter hereof and supersedes all negotiations,
representations and warranties, commitments, offers, contracts and writings
prior to the date of this Agreement, except the Reciprocal Secrecy Agreement
between Xxxxxx and TRDC dated September 6, 1994, incorporated herein and made a
part thereof Otherwise, the Parties to this Agreement are not to be bound by any
representations, warranties or agreements other than those set forth herein or
in a written amendment to this Agreement hereinafter entered into by the Parties
and duly executed by each party. Nothing stated in this Agreement shall be
construed against the drafting party solely because of the submission of this
Agreement to the other party.
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IN WITNESS WHEREOF, THE PARTIES HERETO HAVE CAUSED THIS AGREEMENT TO BE DULY
EXECUTED, IN DUPLICATE, IN THE STATE OF NORTH CAROLINA.
XXXXXX TECHNOLOGIES, INC. TRIANGLE RESEARCH &
DEVELOPMENT CORP.
By: \s\ Xxxx Xxxxxx By: \s\ Xxxxx X. Xxxxxx
---------------------------- -----------------------------
Title: Chief Executive Officer Title: President
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Date: 1 May 1995 Date: 5 May 1995
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APPENDIX T
Pre-Existing TRDC Accounts
Company/Individual Location Product(s)
Mullion Manufacturing Ltd. South Humberside, U.K. Hypothermia Garments
Safety Technical Services Liverpool, U.K. Marine Safety Products
Xxxxx Xxxxxx* Liverpool, U.K. Marine Safety Products
Xxxxx Xxxxxx* Roanoke Rapids, N.C. Food Packaging Products
Xxxxx Xxx-Xxxxx* Minneapolis, Minnesota Electronic Products
Xxxx Xxxxxx* Lincoln, Nebraska Agricultural Packaging
Xxxx Xxxxxxxx* Raleigh, North Carolina Power Electronics
ERG Inc. Oakland, California Heat Exchangers
Ophir Corporation Litteton, Colorado Lasers, Optics and Radar
Sparta Corporation Huntsville Alabama Laser ordnance
H & A Company San Diego, California Aircraft Electronics
Simula Corporation Asheville, NC and Aircraft Seating
Phoenix, Arizona
* includes all affiliates of the listed individual wherein that individual is an
employee, equity participant or paid consultant.
