LICENSE AND MATERIALS PURCHASE AGREEMENT
THIS AGREEMENT, made and entered into this 24th day of January, 2001, by
and between Millennium Plastics Corporation, (referred to herein as
"Millennium"), and T-PLEX TECHNOLOGIES, a Nevada corporation ("Licensee").
WHEREAS, Millennium has acquired and developed technology related to
biodegradable plastics, which Millennium has named the SolplaxT Technology
(collectively the "SolplaxT Technology"), and owns patents, copyrights,
confidential information, trade secrets, and proprietary know-how relating to
such technology; and
WHEREAS, Millennium seeks the expanded development and mass marketing of
the SolplaxT Technology as a commercial standard for biodegradable plastics
and use; and
WHEREAS, Licensee desires an exclusive license under Millennium's
SolplaxT Technology for use in T-PlexT, a plastic stretch film to be utilized
for protecting fully assembled vehicles while being transported, and
Millennium is willing to grant such a license.
NOW, THEREFORE, in consideration of the mutual covenants, terms,
conditions and provisions set forth herein, the parties agree as follows:
1. DEFINITIONS
1.1. "SolplaxT Technology" shall mean all confidential or proprietary
information, trade secrets and know how relating to the SolplaxT technology
as such technology is further described on Exhibit A to this Agreement. The
SolplaxT Technology is sometimes referred to herein as the "Licensed
Technology."
1.2. "Licensed Rights" means all rights under any patent, copyright,
confidential or proprietary information, trade secrets and know-how relating
to the SolplaxT Technology.
1.3. "Licensed Tool(s)" shall include product chemistry systems, proprietary
manufacturing systems, development methodologies, and documentation that
encompass or incorporate or are based on any of the SolplaxT Technology, but
do not include products, and services that result from "Authorized Use" of
the SolplaxT Technology. Licensed Tools specifically excludes Licensee
implementations of the SolplaxT Technology.
1.4. "Authorized Use" refers to those activities and Licensed Rights granted
by Licensee under this Agreement to everyone who purchases or sub-licenses a
Licensed Tool.
1.5. "Reasonable Effort" means a reasonable program of supporting technology
improvements and marketing that expands industry adoptions, installed base,
and commercial use of the SolplaxT Technology.
1.6. "Improvement(s)" shall mean inventions, modifications, adaptations or
improvements, which relate to or are based on the SolplaxT Technology.
1.7. "Sublicensee" shall mean a person or entity to whom Licensee has granted
the right under the SolplaxT Technology to develop, manufacture, have
manufactured, use, market and/or sell the Licensed Tools.
2. GRANT OF LICENSE
2.1. Exclusive License. Millennium hereby grants to Licensee, subject to the
conditions set forth in this Agreement, an exclusive non transferable license
under the Licensed Rights to make, have made, use, market, import, have
imported, lease, sell, distribute, offer for sale, or otherwise dispose of T-
PlexT, as herein defined, utilizing Licensed Tools throughout the world,
including the right to make copies of, make derivative works based on, and
distribute any copyrighted works within the Solplax Technology. The license
is strictly limited to Licensee's right to make, use, market, import, lease,
sell, distribute, offer for sale, or otherwise dispose of T-PlexT, and such
license may not be utilized for any other purpose without permission of
Millennium. T-PlexT is a proprietary product developed by Licensee utilizing
Licensed Tools. T-PlexT is a plastic transportation wrap material, produced
in sheets, utilizing Licensed Tools, which creates a biodegradable plastic
transportation wrap to assist in the protection of vehicles during
transportation, such as cars, boats, trucks, airplanes, and other vehicles,
which in shipment require special shipment and handling.
2.2. Sublicense. Licensee shall have the right to grant sublicenses to third
parties, subject to the terms of this Agreement and subject to the written
approval by Millennium.
2.3. Reservation of Rights. Millennium expressly reserves all rights not
granted to Licensee in this Agreement for its own purposes.
3. CONSIDERATION
3.1. Material Purchases. Commencing on the date of this Agreement, Licensee
shall purchase exclusively from Millennium any and all raw materials,
including the "SolplaxT" formulated plastic and additives, that are used in
the manufacture of T-PlexT using the Licensed Tool. A grant of a Sub-License
by Licensee will carry the exact same requirements as defined in this
agreement by the Sub-Licensee including the purchase of any and all raw
materials, including the "SolplaxT" formulated plastic and additives, that
are used in the manufacture of T-PlexT using the Licensed Tool from
Millennium. Millennium will provide the SolplaxT formulated plastic material
and additives in a combined pelletized form to the Licensee.
3.2. Price List. Millennium will sell its formulated SolplaxT Plastic
material to the Licensee at an initial bulk price of USD$14.50/lb. The basis
for this price will be tied to the cost of raw PVA purchased by Millennium.
Once a year Millennium will provide an index related to the cost of its raw
PVA material to the Licensee. That index will be calculated by dividing the
new year cost of PVA by the cost of PVA material as of January 1, 2001. The
index will then be multiplied by the initial bulk price of USD$14.50/lb to
arrive at the new price to be paid by the Licensee for the upcoming year. In
addition any and all additives not included in the SolplaxT patents that are
used in the formulation of T-PlexT will be provided at the current market
price paid by Millennium plus 25%.
4. COMMITMENTS OF LICENSEE. Licensee agrees to use its reasonable efforts
to achieve the development and commercialization of the Licensed Technology.
5. OWNERSHIP
5.1. Licensed Rights. Licensee acknowledges that Millennium is the sole
owner of the Licensed Rights. Except as provided in this Agreement, Licensee
agrees not to take any action challenging or opposing, on any grounds
whatsoever, Millennium's ownership of the Licensed Rights, or the validity
thereof.
5.2. Improvements. Licensee agrees that any Improvements or derivative works
to T-PlexT shall be jointly developed by Licensee and Millennium and any
Improvements or derivative works to or based on the SolplaxT Technology,
whether or not patented or patentable, shall be the property of Millennium.
Licensee shall be granted the first right to an additional license from
Millennium for the new product(s) or technology.
6. TERM AND TERMINATION
6.1. Term. The term of the license granted hereunder shall commence as of
the date of this Agreement and shall remain in force for 3 years or until
terminated in accordance with the provisions of this Agreement
6.2. Termination by Licensee. Licensee shall have the right to terminate
this Agreement upon written notice delivered to Millennium. The effective
date of termination shall be the end of the quarter in which notice was
delivered, or thirty (30) days whichever is longer, whereupon Licensee shall
be relieved of all further obligations under this Agreement and all rights
granted to Licensee under this Agreement shall be canceled and revert to
Millennium.
6.3. Termination by Millennium; Conversion to Non-Exclusive License.
6.3.1. Should Licensee fail to perform any material covenant of this
Agreement on its part to be performed, then upon written notice of such
failure from Millennium, Licensee shall have thirty (30) days from the date
of such notice to correct a breach which relates to the timely payment of
funds to Millennium, and shall have ninety (90) days from the date of such
notice to correct any other breach, and upon the failure of Licensee to do
so, Millennium may terminate this Agreement upon ten (10) days further
written notice.
6.3.2. Should Licensee fail to commence sales of Licensed Tools within
twelve (12) months from the date of this Agreement, Millennium shall have the
option to convert the license hereunder to a non-exclusive license upon sixty
(60) days prior written notice to Licensee.
6.3.3. In the event of a substantial decrease in Licensee's continued
commitment to the development, mass marketing, and commercial acceptance of
this technology will be assessed annually, given the failure of Licensee to
meet either of the milestones in Section 6.3.4, Millennium shall have the
option to convert the license hereunder to a non-exclusive license upon sixty
(60) days prior written notice.
6.3.4. MILESTONES.
Annual growth in sales of Licensed Tools > 10 %
Annual Sales of Licensed Tools > $1,000,000 by 2003.
6.3.5 In the event Licensee is "acquired," which term shall include
any merger, consolidation, sale, reclassification, reorganization, asset
purchase, share exchange or other disposition whereby Licensee's shares
of common stock are purchased or exchanged with a third party with the
intent of taking over Licensee's business, assets, management control
and intellectual property rights, all rights granted under this
Agreement shall be subject to immediate termination by Millennium.
6.4.1 Rights After Termination. No termination of this Agreement shall
affect the rights of Millennium to any royalties due and owing or to
statements of account to and including the date of termination. Upon
termination, all rights granted to Licensee in this Agreement, shall revert
to Millennium. Notwithstanding anything herein to the contrary, upon
Licensee's failure to meet the reasonable efforts requirements of Section4,
Licensee shall maintain a non-exclusive license to the Licensed Technology,
but shall not receive a license to new Improvements. Termination of this
Agreement for any reason shall not release any party hereto from any
liability which, at the time of such termination, has already accrued to
the other party or which is attributable to a period prior to such
termination, nor preclude either party from pursuing any rights and
rememdies it may have hereunder or at law or in equity which accrued or are
based upon any event occurring prior to such termination. The rights
provided for in this Section 6.4 shall be in addition and without prejudice
to any other rights which the parties may have with respect to any breach
or violations of the provisions of this Agreement. In the event that the
license granted to Licensee under this Agreement is terminated, any granted
Sublicenses shall remain in full force and effect, provided that the
Sublicensee is not then in breach of its sublicense agreement, in which
case Millennium and Sublicense shall enter into appropriate agreements or
amendments.
7. REPRESENTATIONS AND WARRANTIES
7.1. Representations and Warranties of Millennium. Millennium represents,
warrants and covenants to Licensee as follows:
(a) Millennium has the full power and authority to execute and deliver this
Agreement and to perform its obligations hereunder. This Agreement
constitutes the valid and legally binding obligation of Millennium,
enforceable in accordance with its terms and conditions. Millennium need
not, give any notice to, make any filing with, or obtain any authorization,
consent, or approval of any government or governmental agency in order to
consummate the transactions contemplated by this Agreement.
(b) Millennium has heretofore developed the Licensed Technology and owns the
Licensed Technology free and clear of all liens, claims and encumbrances.
(c) There are no pending, and to the knowledge of Millennium as of the
Effective Date, any threatened, actions, suits, investigations, claims or
proceedings in any way relating to the Licensed Technology.
7.2. Representations and Warranties of Licensee. Licensee represents,
warrants and covenants to Millennium that:
(a) Licensee is a corporation, duly organized, validly existing and in
good standing under the laws of the State of Nevada having full
corporate power to conduct its business as presently conducted, and to
enter into and consummate the transactions contemplated by this
Agreement.
(b) The execution, delivery and performance under this Agreement by
Licensee have been duly authorized by all required corporate action, do
not constitute a breach, default or violation of any of the provisions
of Licensee's articles of incorporation, bylaws or other charter
documents, or any indenture, agreement, contract, order, law or
regulation to which it may be a party or by the terms of which it may be
bound.
8. CONFIDENTIALITY
8.1. Confidential Information. . Except as expressly provided herein, or
as agreed by the Board of Directors of Licensee, the parties agree that, for
the term of this Agreement and for five (5) years thereafter, the receiving
party shall keep completely confidential and shall not publish or otherwise
disclose and shall not use for any purpose except for the purposes
contemplated by this Agreement any Confidential Information furnished to it
by the disclosing party hereto pursuant to this Agreement, except to the
extent that it can be established by the receiving party by competent proof
that such Confidential Information:
(a) was already known to the receiving party, other than under and
obligation of confidentiality, at the time of disclosure;
(b) was generally available to the public or otherwise part of the
public domain at the time of its disclosure to the receiving party;
(c) became generally available to the public or otherwise part of the
public domain after its disclosure and other than through any act or
omission of the receiving party in breach of this Agreement;
(d) was independently developed by the receiving party as demonstrated by
documented evidence prepared contemporaneously with such independent
development; or
(e) was subsequently lawfully disclosed to the receiving party by a person
other than a party hereto.
Each party hereto may use or disclose information disclosed to it by the
other party to the extent such use or disclosure is reasonably necessary
in filing or prosecuting patent applications, prosecuting or defending
litigation, complying with applicable governmental regulations or
otherwise submitting information to tax or other governmental
authorities, or making a permitted sublicense or otherwise exercising
its rights hereunder, provided that if a party is required to make any
such disclosure of another party's Confidential Information, other than
pursuant to a confidentiality agreement, it will give reasonable advance
notice to the latter party of such disclosure and, save to the extent
inappropriate in the case of patent applications or compliance with
federal and state securities laws, will use its best efforts to secure
confidential treatment of such information prior to its disclosure
(whether through protective orders or otherwise.) As used herein,
"Confidential Information" shall mean (i) any proprietary or
confidential information or material in tangible form disclosed
hereunder that is marked as "confidential" at the time it is delivered
to the receiving party, and/or (ii) any written reports furnished by
either party to the other pursuant to the terms of this Agreement.
9. ENFORCEMENT OF LICENSED RIGHTS
9.1. Notice. Each party shall promptly give the other party written notice
of any apparent infringement of any of the Licensed Rights of which such
party becomes aware.
9.2. Legal Action. Licensee shall have the first right, but not the
obligation, to bring any legal action with respect to any apparent
infringement, at Licensee's own expense and for its own benefit. In such
event, Millennium agrees to cooperate with Licensee and to join in such
action as a party plaintiff if requested to do so by Licensee, and at
Licensee's reasonable request, to give Licensee all needed information,
assistance and authority to file and prosecute such suit; provided that
Licensee shall reimburse Millennium for all verified out-of-pocket expenses
incurred by it in providing such assistance, including attorney's fees,
expenses and expert witness fees. To ensure that no rights of Millennium are
compromised in any such action, Licensee shall not settle any such claim, or
enter into any settlement agreement that admits that any third party product
does not infringe the Licensed Rights or that any of the Licensed Rights is
invalid or unenforceable, without Millennium's prior written consent, which
consent shall not be unreasonably withheld. If there is a recovery in any
such action, after recovery of all direct out of pocket expenses incurred by
Licensee and Millennium in connection with any such legal action, Licensee
shall pay Millennium an amount of monies received from any alleged infringer
equivalent to royalties which Millennium would have received under this
Agreement, if such alleged infringer had been a Sublicensee of Licensee.
10. INDEMNIFICATION
10.1. Indemnification by Licensee. Licensee shall indemnify and hold
Millennium harmless from and against all losses, claims and damages arising
out of or based upon the sale of the Licensed Products by Licensee. If a
claim is made by any third party against Millennium and Millennium intends to
seek indemnification from Licensee with respect to such claim, (i) Millennium
shall promptly notify Licensee of such claim, and (ii) if Licensee
acknowledges such right to indemnification, Licensee shall have sole control
of the defense and all related settlement negotiations.
10.2. Indemnification by Millennium. Millennium shall indemnify and hold
Licensee harmless from and against all losses, claims and damages to the
extent that such loss, claim or damage arises out of or is based upon the
breach of the representations and warranties granted by Millennium in Section
7.1. If a claim is made by any third party against Licensee and Licensee
intends to seek indemnification from Millennium with respect to such claim,
(i) Licensee shall promptly notify Millennium of such claim, and (ii) if
Millennium acknowledges such right to indemnification, Millennium shall have
sole control of the defense and all related settlement negotiations.
11. MISCELLANEOUS PROVISIONS
11.1. Prior Customer Projects. Licensee may utilize prior customer
projects for marketing referenceable deployments of the SolplaxT Technology.
11.2. Successors And Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties named herein and their respective
successors and permitted assigns, including, without limitation, any
corporation which is the surviving corporation in the event of a merger
involving Licensee.
11.3. Waiver. Any failure by either party to enforce at any time any
term or condition of this Agreement shall not be considered a waiver of that
party's right thereafter to enforce each and every term and condition of this
Agreement.
11.4. Patent Marking. Licensee agrees to xxxx each Licensed Tool with a
patent notice in compliance with applicable statutory requirement. If
Millennium obtains any additional patents, on the SolplaxT Technology,
Licensee agrees to xxxx each Licensed Tool with an additional patent notice
in compliance with applicable statutory requirements.
11.5. Entire Agreement. This Agreement and the exhibits and schedules
referred to herein sets forth the entire intent of and understanding between
the parties with respect to the subject matter of this Agreement and
supersedes all prior discussions, negotiations, and agreements between them.
Neither party shall be bound by any agreement or representation other than as
expressly provided herein or as subsequently set forth in writing and
executed by each party.
11.6. Bankruptcy. In the event that either Licensee or Millennium is
adjudged bankrupt, it is the intention of the parties that this Agreement
shall be governed by and construed in accordance with the U.S. Bankruptcy
Code.
11.7. Notices. All notices or other communications relating to this
Agreement shall be deemed to be properly served when sent in written form by
United States certified mail, postage prepaid, or, when delivered by courier
to the respective party at the following address or to each substitute
address as either party may from time-to-time designate in writing to the
other.
To Licensee: T-PLEX TECHNOLOGIES
Attn: Xxxxxx X. Xxxxxx
0000 X. Xxxxxxxx Xx, Xxxxx X
Xxx Xxxxx, XX 00000
To Millennium: Millennium Plastics Corporation
Attn: Xx. Xxxx Xxxxxxxx
0000 X. Xxxxxxxxx Xxx
Xxx Xxxxx, Xxxxxx 00000
With a copy to: Xxxxxx X. Xxxxxxxxxx, Esquire
Law Offices of Xxxxxx X. Xxxxxxxxxx
000 Xxxx Xxxxxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
11.8. Applicable Law. It is understood and agreed that this Agreement
shall be construed, governed, and interpreted in accordance with the laws of
the State of Nevada.
11.9. Severability of Provisions: Reformation. If any term, clause,
word, condition, provision or agreement in this Agreement or the application
thereof or any portion thereof to any person or circumstance, shall be held
invalid, void or unenforceable, the remainder of the term, clause, word,
condition, provision or agreement and the application thereof shall remain in
full force and effect, and the invalid, void or unenforceable term, clause,
word, condition, provision or agreement shall be reformed to the extent
possible in order to give its intended effect and/or meaning.
11.10. Construction. The parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, the Agreement shall be construed
as if drafted jointly by the parties and no presumption or burden of proof
shall arise favoring or disfavoring any party by virtue of the authorship of
any of the provisions of this Agreement.
11.11. Further Assurances/Cooperation. At any time or from time to time
on and after the date of this Agreement, each party agrees to (i) deliver to
the other party such records, data or other documents consistent with the
provisions of this Agreement, (ii) execute, and deliver or cause to be
delivered, all such consents, documents or further instruments of transfer or
license, and (iii) take or cause to be taken all such actions, as each party
may reasonably deem necessary or desirable in order for such party to obtain
the full benefits of this Agreement and the transactions contemplated hereby.
[THE BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK]
SIGNATURE PAGE FOLLOWS
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
in duplicate by their respective duly authorized officers, effective this
24th day of January, 2001.
MILLENNIUM PLASTICS CORPORATION T-PLEX TECHNOLOGIES
/s/ Xxxx Xxxxxxxx /s/ Xxxxxx X. Xxxxxx
BY: Xxxx Xxxxxxxx By: Xxxxxx X. Xxxxxx
Its: CEO and President Its: CEO and President
Date: Date:
EXHIBIT A
Documentation & Patent Information for
SolplaxT Technologies
Invented in 1995, the patented SolplaxT technology is based on an improved
method for manufacturing thermoplastic polyvinyl alcohol (PVA) in combination
with other approved food-grade ingredients commonly used in commercial and
consumer plastic products.
Millennium chemists can manipulate the molecular structure and weights-and
thus firmness and solubility-of the ultimate plastic product by varying the
"recipe", i.e., by using different combinations and ratios of the basic
constituent ingredients:
PVA,
Polyvinyl Acetate (PVAc),
Selected Plasticizers,
Stabilizers,
Coloring,
Fillers, and
Customer Specific Additives.
As a result, SolplaxT polymers offer manufacturers an attractive range of
specifications, which can be tailored to their planned end-use application.
Millennium Plastics currently has a family of base formulations. These base
SolplaxT polymer formulations provide a broad range of water soluble
conditions, some dissolve in cold water 20 C (70 F) while others are soluble
only in hot water 68 C (155 F). Once dissolved, both hot and cold soluble
SolplaxT PVA's are fully biodegradable by natural microbial action into the
by-products of carbon dioxide and water. Neither the monomers, plasticisers
and/or stabilisers are toxic.
The rigidity of the final SolplaxT product can be controlled by varying the
amounts of stabiliser and plasticiser incorporated into the base mixture.
Similarly, the molecular weight of the plastic has direct bearing on the
hardness of the plastic. The molecular weights of the SolplaxT polymer are in
the range of 60,000 - 35,000 daltons. The preferred weight is in the range of
55,000 +/- 5,000 daltons. The softer and more pliable the plastic, the lower
would be the molecular weight. Depending on the final product, that is, if
the product is to be a flexible bag or a rigid eating utensil, different
combinations of copolymers, plasticisers and stabilisers would be formulated.
As previously mentioned Millennium Plastics has the technology to produce
eight similar, but different, SolplaxT polymers which possess distinctive
characteristics.
The SolplaxT technologies are held by patents involving the process,
compounding and manufacture of the SolplaxT plastics. Patents and patent
pendings include those in the United States, Ireland, European Patent
Cooperation Treaty (PCT), Canada, Thailand and India. The initial Irish
patent is Patent # S71912 "Plastic Material And a Method for It's
Manufacture" granted June 30, 1997 while the initial US patent is US Patent
5,948,848 "Biodegradable Plastic Material And a Method for It's
Manufacture", granted September 7, 1999. More than a half dozen other patents
are pending or in the application stages regarding additional claims to the
process and coatings.
