EXHIBIT 10.16
AMENDED AND RESTATED LICENSE AGREEMENT WITH INSTA-HEAT, INC.,
EFFECTIVE SEPTEMBER 30, 1995
AMENDED AND RESTATED
LICENSE AGREEMENT
This Amended and Restated License Agreement ("Agreement") is entered into
effective as of September 30, 1995, by and among INSTA-HEAT, INC., a California
Corporation ("IHI") with its principal offices at 00000 Xxxxxx Xxxxx Xxxx, Xxx
Xxxxx, Xxxxxxxxxx 00000, Xxxxx X. Xxxxxxx, an individual ("Xxxxxxx"), Xxxxx X.
Xxxxxxxx, an individual ("Xxxxxxxx"), and ONTRO, INC., a California corporation
("Ontro"), with its principal offices at 00000 Xxxxxxxxx Xx., #000, Xxxxx,
Xxxxxxxxxx 00000. The parties to this Agreement are sometimes referred to
collectively herein as the "Parties."
RECITALS
IHI, has developed certain technology embracing self-heating containers.
IHI desires to have the technology commercialized through the granting of an
exclusive license to the technology and all related technology, and all
technology developed by IHI in the future; and
Ontro was organized for the principal purpose of acquiring a license to
commercialize the self-heating container technology, either itself or by various
sublicenses. Ontro desires to acquire the exclusive license to the technology.
Ontro and IHI now wish to amend and restate their original License
Agreement dated March 30, 1995. This Amended and Restated License Agreement
supersedes, amends and restates the March 30, 1995 License Agreement.
Incorporating the above recitals herein, and in consideration of the
obligations contained herein and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties agree as
follows:
ARTICLE I
DEFINITIONS
1.1 "CONFIDENTIAL INFORMATION" shall mean information in any form
owned or controlled by a party to this Agreement that is not generally known by
the general public. Confidential Information includes, without limitation,
trade secrets, formulas, processes, know-how, data, designs, drawings, costs,
efficiency rates, price lists, and any information relating to self-heating and
all other forms of thermal containers, including both technical and
non-technical matters. Confidential Information may be patentable or
unpatentable, copyrightable or uncopyrightable. Nevertheless, Confidential
Information shall not include:
(a) that which, at the time of disclosure or later, is published or
otherwise becomes available to the general public, without breach of this
Agreement; and
(b) that which has been known or possessed by a party, its employees or
agents prior to the date of disclosure to it by the other party, provided
such party delivers Written Notice to the disclosing party within the (10)
business days following such disclosure that the receiving party already
possessed such information.
Confidential Information disclosed under this Agreement shall not be deemed
to be within the foregoing exceptions merely because it is embraced by more
general information in the public domain or the parties' possession at the
execution of the Agreement.
1.2 "GROSS SALES PRICE" shall mean invoice sales price less sales or
use taxes, credit for returned goods, packing, shipping, insurance, discounts,
and similar charges or adjustments, as listed on the Invoice.
1.3 "LICENSED PRODUCT" shall mean any self-heating or self-cooling or
other forms of thermal container or component thereof, any accessory for any
such container, and any heating or cooling module or component thereof, together
with any and all improvements on any of such items, that:
(a) incorporates or is manufactured using one or more of Licensor's
Inventions, including but not limited to, that which is covered by one or
more claims of one or more of Licensor's Patents and that which
incorporates or is manufactured in accordance with trade secrets of or
Confidential Information of Licensor; or
(b) is offered for sale under one or more of Licensor's Marks; or
(c) incorporates or is manufactured in accordance with material covered by
one or more of Licensor's Copyrights.
1.4 "LICENSOR" shall mean IHI, as well as Xxxxx X. Xxxxxxx and Xxxxx
X. Xxxxxxxx, together with their employees, officers, directors, shareholders
and agents.
1.5 "LICENSOR'S COPYRIGHTS" shall mean any copyrights now owned by
Licensor or hereafter acquired or used by Licensor during the term of this
Agreement associated with involving, related to or connected with any
self-heating or self-cooling or any other form of thermal containers or any
component, feature, accessory, heating or cooling module, or any improvement
thereon.
1.6 "LICENSOR'S INVENTIONS" shall mean structural, functional,
design and ornamental aspects of self-heating or self-cooling containers,
including components of the containers and all processes for manufacturing the
containers or components, including all know-how and trade secrets of Licensor,
and all improvements thereto, patentable or unpatentable, now owned or
controlled by Licensor or developed or acquired by Licensor during the term of
this agreement. "Licensor's Inventions" includes, without limitation,
Licenser's Patent Applications defined below and all Confidential Information,
and all Patents issued from Licensor's Patent Applications or otherwise
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acquired by Licensor. Ontro hereby acknowledges the existence of such aspects
of self-heating containers or self-cooling and other form of thermal containers,
and admits to their novelty in view of the state of the art in container design
and manufacture as of the date hereof.
1.7 "LICENSOR'S MARKS" shall mean any and all marks now owned by
Licensor used in connection with or associated with, related to, or involving
any self-heating or self-cooling or other forms of thermal containers or all of
such marks hereafter acquired or used by Licensor during the term of this
Agreement in connection with, associated with, related to or involving
self-heating or self-cooling or any other form of thermal containers, including
without limitation, the marks "INSTA-HEAT," "INSTA-COOL," and "ANYTIME,
ANYWHERE."
1.8 "LICENSORS NEW INVENTIONS" shall mean structural, functional,
design, process, and ornamental aspects of any device or object used in
connection with or related to thermal containers, other than Licensor's
Inventions, including without limitation, components of a device or object used
in connection with or related to thermal containers and processes for
manufacturing the device or object or any of its components, including all
know-how and trade secrets of Licensor used in connection with or related to
thermal containers, and improvements thereto, patentable or unpatentable, now
owned or controlled by Licensor or conceived, developed or acquired by Licensor
during the term of this agreement. "Licensor's New Inventions" includes,
without limitation, Licensor's patent applications, if any, and all Confidential
Information relating to any device or object used in connection with or related
to thermal containers.
1.9 "LICENSOR'S PATENT APPLICATIONS" shall mean technology described
and claimed in United States patent application serial no. 08/250, 537, entitled
"CONTAINER WITH INTEGRAL MODULE FOR HEATING OR COOLING THE CONTENTS," filed May
31, 1994. Such term also includes United States design patent application
serial no. 29/025/518, entitled "BEVERAGE CONTAINER," filed July 5, 1994, and
United States patent application serial no. 08/550,547 filed October 30, 1995.
Licensor's Patent Applications also includes any continuations,
continuations-in-part, divisions, reissues, and improvements relating to the
foregoing applications, both in the United States, and other countries and under
any patents that may issue on any of the Licensor's Patent Applications during
the term of this Agreement relating to self-heating or self-cooling or any other
form of thermal containers or any component, feature, accessory, heating,
cooling or other thermal module or improvement thereon, both in the United
states and in other countries worldwide ("Licensor's Patents").
1.10 "LICENSOR'S PROPERTY" shall mean any molds, prototypes, machines,
tools, blueprints, drawings, specifications, data and similar property used in
connection with or related to thermal containers, and provided by Licensor to
Ontro before or during the term of this Agreement.
1.11 "WRITTEN NOTICE" shall mean mailing of the information by
first-class, registered, or U.S. Express Mail or delivery by a national
overnight delivery service, with postage or delivery charges prepaid and
addressed as follows:
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If to Licensor: If to Ontro:
INSTA-HEAT, INC. Ontro, Inc.
11944 Xxxxxx Xxxxx Ln. 00000 Xxxxxxxxx Xx., #000
Xxx Xxxxx, XX 00000 Xxxxx, XX 00000
Attention: President Attention: President
ARTICLE II
GRANT OF EXCLUSIVE LICENSE
Licensor hereby grants to Ontro the exclusive worldwide rights to
manufacture, use, sell and promote Licensor's Inventions and Licensor's New
Inventions, as provided below, and to use any of Licensor's Patents, Licensor's
Copyrights and Licensor's Marks in connection with the manufacture, use, sale
and promotion of Licensed Products, ("Licensed Technology").
2.1 PRODUCT SPECIFICATIONS: Licensor shall furnish to Ontro all of
the information within its possession as of the date hereof or coming into its
possession hereafter during the term of this Agreement, relating in any way to
self-heating or self-cooling or other form of thermal containers, including
without limitation, any specifications for the information or technology and all
information concerning the use of particular materials or manufacturing methods.
2.2 QUALITY: Licensor does not warrant that the specifications
furnished by it will be sufficient to assure heating or cooling of the specified
volume of any container to any specified temperature within any time limits
specified. The specifications may include prototypes or examples of
self-heating containers or components thereof. Licensor undertakes and agrees
to use reasonable efforts throughout the term of the Agreement to update and
improve the specifications from time to time.
2.3 PROPRIETARY TECHNOLOGY: The parties understand and acknowledge
the Licensed Technology embodies proprietary technology owned by Licensor, which
proprietary technology may be the subject of trade secret protection and United
States and foreign patent applications or patents.
2.4 SUBLICENSES: Ontro may grant Sublicenses to such persons and
upon such terms as it may determine, provided that the rights granted to
sub-licensee are not greater than the rights granted to Ontro herein, and that
all sub-license royalties are paid to Licensor as provided herein. Ontro shall
notify Licensor of any sublicenses granted by it and the general terms thereof
within 30 days following the grant of such sub-license.
2.5 GRANT BACK OF IMPROVEMENTS: If, during the term of this
Agreement, Ontro makes any improvements to Licensor's Inventions, Licensor
grants to Ontro an exclusive worldwide royalty-free license to manufacture, use
and sell any such improvements, including such rights under any U.S. or foreign
patents Ontro may receive or otherwise acquire. All intellectual property
ownership rights to any improvements will be owned by Licensor.
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2.6 EXPANSION OF LICENSE: Any and all improvements, updates,
upgrades, refinements and modifications of any sort which are used in connection
with or are related to the Licensed Technology, conceived or implemented by
Licensor during the term of this Agreement are specifically included within the
terms of the license granted hereunder. Licensor shall immediately notify Ontro
in writing of any such improvements, updates, upgrades, refinements or
modifications of any sort affecting the Licensed Technology, including but not
limited to the Licensor's Inventions, Licensed Products, or Licensor's Property,
including all information of every sort within the control, custody or
possession of Licensor relating to the same, including without limitation,
Confidential Information. In addition, Licensor shall immediately notify Ontro
in writing of any and all Licensor's New Inventions developed or conceived
during the term of this Agreement. Such writing shall be of sufficient detail
to enable Ontro to clearly delineate the nature and scope of such Licensor's New
Invention and to form a reasoned decision concerning its utility and potential
marketability. Following its receipt of such written notification, Ontro shall
have the option for a period of 90 days to evaluate the nature and scope of such
Licensor's New Inventions and to elect to include the same within the scope of
this Agreement by written notification to Licensor, stating the Licensor's New
Inventions which it is electing to include within the terms of this Agreement
applicable to Licensor's Inventions as if originally included in the definition
set forth at Section 1.6.
ARTICLE III
CONFIDENTIALITY
3.1 DUTY TO PROTECT CONFIDENTIAL INFORMATION: Any Confidential
Information disclosed or conveyed by Licensor to Ontro or by Ontro to Licensor
by written communication and marked as confidential, by oral communication and
confirmed in writing within thirty (30) working days of oral disclosure, or by
transfer or demonstration of a self-heating or self-cooling or other form of
thermal container or component thereof in which Confidential Information is
embodied or included and confirmed in writing within thirty (30) working days,
shall be treated by the receiving party as secret and confidential and shall be
held in trust for the disclosing party. The receiving party shall treat such
information and take such steps to assure its continued confidentiality in like
manner as it would use to protect its own trade secrets or confidential
information and will not, except as required by law, disclose any such
Confidential Information received from the other party to any third party who is
not bound under a confidentiality and non-disclosure agreement.
3.2 MEANS OF PROTECTING CONFIDENTIAL INFORMATION: Licensor and Ontro
agree to take reasonable steps to ensure the proprietary and confidential nature
of Confidential Information and of Property in which Confidential Information is
embodied or included and to protect the same from loss or theft and agree to
clearly xxxx such Confidential Information and properly indicate its proprietary
nature.
ARTICLE IV
MANUFACTURE AND SALE OF LICENSED PRODUCTS
4.1 BEST EFFORTS: Ontro shall use its reasonable best efforts to
develop demand for and further sales of the Licensed Products. Licensor shall
provide Ontro or its nominee with all
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information within its possession, custody or control, including without
limitation, blueprints, working drawings, specifications, molds, prototypes,
machines, tools, and data relating to the Licensed Technology, Licensor's
Inventions, Licensed Products or Licensor's Property and use reasonable efforts
to assist Ontro in producing, marketing and distributing Licensed Products.
4.2 SUBCONTRACT OF MANUFACTURE: Ontro, in its sole discretion shall
determine the means and methods by which Licensed Products shall be
manufactured. Ontro may manufacture Licensed Product or components thereof
directly or contract or subcontract for such manufacture by such persons or
sub-license the Licensed Technology to such persons as it may determine in its
sole discretion. Ontro shall determine to its own satisfaction that each
subcontractor, and sub-licensee meets Ontro's quality and production needs and
the terms of any such contract, subcontract or sub-license.
4.3 PATENT MARKING: Ontro shall determine, in its sole discretion,
the extent to which each Licensed Product sold by Ontro utilizes Licensor's
Patents and shall use its best efforts to cause each Licensed Product utilizing
Licensor's Patents to indicate it is covered by one or more of such patents.
4.4 TRADEMARK USE: Ontro shall determine, in its sole discretion,
the extent to which each Licensed Product sold by Ontro is marked with one or
more of Licensor's Marks in such form and manner as Ontro may determine from
time to time. The nature and quality of all Licensed Products shall conform to
standards set by Ontro in its sole discretion and Licensor shall cooperate with
Ontro in facilitating Ontro's control of the nature and quality of Licensed
Products. Upon reasonable request, Ontro shall furnish to Licensor, without
cost, samples of Licensed Product for Licensor's examination and inspection.
Licensor undertakes and agrees, upon request, to use its best efforts to assist
Ontro in evaluating Licensed Products and maintaining such levels of consistency
and quality in manufacturing as Ontro may establish in its sole discretion.
Ontro shall, at all times maintain the sole authority concerning manufacture,
design, distribution and marketing of Licensed Products and Licensor's efforts
in connection therewith shall be strictly advisory in nature.
4.5 COPYRIGHT NOTICE: Ontro shall, in its sole discretion,
determine the extent to which each Licensed Product sold by Ontro is covered by
Licensor's Copyrights and marked with appropriate copyright notices.
ARTICLE V
MAINTENANCE OF LICENSOR'S INTELLECTUAL PROPERTY
5.1 PATENT PROSECUTION: In the event Licensor becomes aware of any
infringement of Licensor's Patent Application or violation of any copyright or
xxxx protection during the term of this Agreement, Licensor shall immediately
notify Ontro of such infringement or violation and shall consult with and
cooperate in any way requested by Ontro in responding to such infringement or
violation. Notwithstanding the foregoing, Ontro shall determine in its sole
discretion, the action, if any, to be taken with respect to such infringement or
violation, including without limitation the degree to which the parties will
undertake to prosecute any such infringements or violations and any
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such actions undertaken shall be at the expense and direction of Ontro. In
connection with such suits, Licensor shall execute all papers necessary or
appropriate in the discretion of Ontro, and Licensor shall testify in any suit
whenever requested to do so by Ontro. If Ontro finds it necessary or
appropriate in any suit that Ontro may institute, Licensor agrees to join Ontro
as a party plaintiff in such proceeding. In any such event, however, Licensor
shall not be charged for any costs or expenses.
5.2 ASSISTANCE IN PROTECTION: In addition to its undertaking set
forth in the preceding section, Licensor agrees to render to Ontro all
assistance requested of it by Ontro in connection with the protection of
Trademarks, Patents or Copyrights, and to make promptly available to Ontro its
records, personnel files and any other files or information it possesses or to
which it has access that may be of use to Ontro in such connection.
5.3 INFRINGEMENT: Licensor represents and warrants that, to the best
of its actual knowledge without investigation, the manufacture, distribution and
sale of Licensor's Inventions shall not violate or infringe any valid
trademarks, patents and/or copyrights held by third parties.
ARTICLE VI
ROYALTY AND OTHER PAYMENTS
6.1 INITIAL PAYMENT: Ontro shall pay to Licensor a one-time fee of
one dollar ($1.00) upon execution of this Agreement, receipt of which is
acknowledged by Licensor by its signature below.
6.2 MINIMUM ROYALTY: Except as otherwise provided in this Agreement,
the amount of the royalty Ontro shall pay to Licensor during any calendar year
shall be a minimum of fifty thousand dollars ($50,000), payable annually not
later than March 30 of the following calendar year. Except as otherwise
specifically provided herein, such royalty payment obligation shall continue
with respect to all Licensed Products sold by Ontro in perpetuity.
6.3 CONTINUING ROYALTY: Ontro shall pay a continuing royalty in any
year in which Ontro generates at least $4 million in annual net after tax
operating income, including payment of all royalties due in connection with
this Agreement. The amount of such additional royalty shall be the greater of
(I) two percent (2%) of the gross sales for all sales up to $30 million in Ontro
sales of products utilizing the licensed technology; or (ii) 1.5 cents per unit
sold, and, to the event gross sales of products utilizing the licensed
technology exceed $30 million, the amount of additional royalty payable with
respect to such excess shall be the greater of (I) three percent (3%) of the
amount of gross sales in excess of $30 million; or (ii) 1.5 cents per unit sold
in excess of the first $30 million in sales.
6.4 ACCOUNTING: No later than forty-five (45) days following the end
of each calendar quarter, Ontro shall furnish full and accurate quarterly
reports to Licensor containing a statement of the number of Licensed Products
manufactured, sold or caused to be manufactured or sold by Ontro.
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6.5 DATE ROYALTY DUE: At the time Ontro furnishes Licensor with a
quarterly report, Ontro shall pay to Licensor royalties accrued as a result of
Licensed Products sold by Ontro during the preceding calendar quarter and on or
before March 30 of each calendar year any amount required to fulfill the minimum
royalty requirements for the preceding calendar year.
6.6 REDUCTION IN ROYALTY: During such time as Licensor does not own
one or more Licensor's Patents or Applications, the dollar amount of the
continuing royalty that would otherwise have been payable under Section 6.3 of
this Agreement shall be reduced by twenty-five percent (25%) but shall be
otherwise payable in the same manner and under the same terms and conditions.
After such time as Licensor's Patents are expired or lapsed due to the
nonpayment of a maintenance fee, or each of the claims of each of Licensor's
Patents has been judged by court of competent jurisdiction, from which no appeal
can be taken, to be invalid or unenforceable or to not cover any self-heating or
self-cooling or other form of thermal container, or any heating, cooling or
other thermal module or component thereof, any accessory for a self-heating or
self-cooling container, or any heating or cooling module or component thereof
manufactured or sold by Ontro, the dollar amount of the continuing royalty which
would otherwise have been payable under Section 6.3 of this Agreement shall be
reduced by twenty-five percent (25%) but shall otherwise remain payable in the
same manner and under the same terms and conditions.
6.7 ROYALTIES ON SUBLICENSING: Ontro shall pay to Licensor in U.S.
dollars an additional royalty computed as follows. Such amount shall be payable
no later than 45 days following the end of each calendar year.
(a) In each calendar year in which the total number of Licensed Products
sold by sub-licensees of Ontro is less than fifty million (50,000,000), for
each Licensed Product sold by a sub-licensee, Ontro shall pay Licensor
fifteen percent (15%) of the royalty received by Ontro from a
sub-licensee's sale of the Licensed Product sold or 0.225 cents ($0.00225)
per unit sold, whichever is greater.
(b) In each calendar year in which the total number of Licensed Products
sold by sub-licensees is greater than or equal to fifty million
(50,000,000) and less than seventy-five million (75,000,000), for each
Licensed Product sold by a sub-licensee, Ontro shall pay Licensor twelve
and one-half percent (12.5%) of the royalty received by Ontro from a
sub-licensee's sale of the Licensed Product sold or 0.188 cents ($0.00188)
per unit sold, whichever is greater.
(c) In each calendar year in which the total number of Licensed Products
sold by sub-licensees is greater than or equal to seventy-five million
(75,000,000), for each Licensed Product sold by a sub-licensee, Ontro shall
pay Licensor ten percent (10%) of the royalty received by Ontro from a
sub-licensee's sale of the Licensed Product or 0.150 cents ($0.0015) per
unit sold, whichever is greater.
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6.8 RIGHT TO INSPECT BOOKS: Upon ten (10) days written Notice from
Licensor to Ontro but not more than two times in any twelve month period,
Licensor or its representatives shall have the right to inspect the books of
account and other records of Ontro for the purpose of ascertaining the number of
Licensed Products manufactured or sold by Ontro, the amount received for them,
the cost of manufacturing them and any other information Licensor may be
required or entitled to obtain in order to determine whether Ontro is fully
performing the terms, covenants and conditions of this Agreement.
6.9 COST AND EXPENSES OF INSPECTION: Licensor shall conduct any
inspections of the records of Ontro at its own expense, but if any item of
information Licensor is required or entitled to obtain in order to determine
whether Ontro is fully performing the terms, covenants and conditions of this
Agreement materially differs from that which Ontro furnished to Licensor in a
quarterly report or otherwise, Ontro shall reimburse Licensor for all cost and
expenses, including fees charged by a certified public accountant, attorney or
other representative of Licensor involved in the inspection.
6.10 ADJUSTMENT: Independent of any inspection of the books of
account and other records of Ontro, Licensor will credit to Ontro the amount of
any overpayment made in error which is identified and fully explained in a
written notice to Licensor delivered within twelve (12) months after the due
date of the payment which included such alleged overpayment, provided that
Licensor is able to verify, to its reasonable satisfaction, the existence and
extent of the overpayment. Rights conferred by this Section 6.11 shall not be
affected by any statement appearing on any check or other document, except to
the extent that any such right is expressly waived or surrendered by a party
having such right and signing such statement.
6.11 COST OF RENEWAL OF PATENTS AND ADDITIONAL PATENT APPLICATIONS:
In addition to the payments provided above, Ontro shall bear the cost of any
additional Patent Applications in connection with the Licensed Technology,
Licensed Products, Licensor's Inventions, Licensor's Property, renewal,
extension, maintenance or modification of Licensor's Copyrights, Licensor's
Marks or Licensor's Patent Applications. Licensor shall take any action
requested by Ontro with respect to such renewal, extension, maintenance or
modification. Ontro shall also bear the cost of any of Licensor's New
Inventions which Ontro elects to include within the term of this Agreement.
ARTICLE VII
PURCHASE OPTION
7.1 OPTION TO PURCHASE: Licensor grants to Ontro the absolute option
to purchase all of Licensor's rights, title and interest in and to Licensor's
Inventions, Licensor's New Inventions, Licensor's Patents, Licensor's
Copyrights, Licensor's Marks, and any and all other rights of any sort
whatsoever relating in any way to the Licensed Technology or Licensed Products.
Such option may be exercised at any time prior to 5:00 p.m., Pacific Standard
Time on December 31, 1999 by delivery of written notice of Ontro's intention to
exercise its option, delivered in accordance with the provisions of this
Agreement and accompanied by payment of the sum of $3 million, by bank or
cashier's check or by receipt of a wire transfer in good, clear funds in such
amount. The term of the option may be extended until 5:00 p.m. December 31,
2000 by delivery of written notice of Ontro's
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election to extend the option delivered prior to the expiration of the option in
accordance with Section 1.11 of this Agreement and accompanied by payment of the
sum of $100,000, by bank or cashier's check, or by receipt of a wire transfer in
good clear funds in such amount. In the event that Ontro has prepaid any
minimum royalty due, computed as of the date of exercise of the option granted
in this Section, the amount of any such prepayment may, at Ontro's election, be
applied against the purchase price or the extension payment, as appropriate.
Upon exercise of the option granted under this Section, IHI undertakes and
agrees to execute and deliver to Ontro any and all documents of any sort
relating to the transfer of IHI's interests following exercise of the option.
Such documents shall be executed and delivered immediately upon written request
therefor by Ontro, but in no event more than five days following receipt by IHI
of written request for such documents from Ontro delivered to IHI in accordance
with Section 1.11 hereof.
ARTICLE VIII
CLAIMS AND INDEMNIFICATION
8.1 INDEMNIFICATION AGAINST THIRD-PARTY CLAIMS: Except as otherwise
set forth above in Article V, Ontro shall indemnify and hold Licensor harmless
against any and all claims arising from Ontro's use, manufacture, promotion,
sale or distribution of Licensed Products or from any activity, work or thing
done or permitted or suffered by Ontro anywhere and shall further indemnify and
hold Licensor harmless from and against any and all claims arising from any
breach or default in the performance of any obligation of Ontro to be performed
under any provision of this Agreement or any agreement resulting from the
negligence of Ontro, and from and against all costs, actual attorneys' fees
expenses and liabilities incurred therein if any action or proceeding is brought
thereon against Licensor by reason of any such claim upon Written Notice from
Licensor, Ontro shall defend Licensor at Ontro's expense by counsel satisfactory
to Licensor. Ontro, as a material part of the consideration to Licensor, hereby
assumes all risks of damage to property or injury to person, arising from any
cause, and Ontro hereby waives all claims relating to Licensed Products in
respect thereto against Licensor. Examples of such causes include, by way of
illustration and not by trade regulation or similar statute, unfair competition,
any product liability or product-related responsibility of Ontro. Licensor
shall indemnify and hold Ontro harmless against any and all claims arising from
any activity, work or thing done or permitted or suffered by Licensor anywhere
and shall further indemnify and hold Ontro harmless from and against any and all
claims arising from any breach or default in the performance of any obligation
of Licensor to be performed under any provision of this Agreement or any
agreement resulting from the negligence of Licensor, and from and against all
costs, actual attorneys' fees expenses and liabilities incurred therein if any
action or proceeding is brought thereon against Ontro by reason of any such
claim. Upon Written Notice from Ontro, Licensor shall defend Ontro at
Licensor's expense by counsel satisfactory to Ontro. Licensor, as a material
part of the consideration to Ontro, hereby assumes all risks of damage to
property or injury to person, arising from any cause relating to Licensor's
business, including the Licensed Products, prior to the date hereof, and
Licensor hereby waives all claims in respect thereto against Ontro. Examples of
such causes include, by way of illustration and not by trade regulation or
similar statute, unfair competition, any product liability or product-related
responsibility of Licensor.
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8.2 LIABILITY FOR CLAIMS OF PARTIES: Except as otherwise provided in
this Agreement, neither party shall be liable for injury to the other's business
or any loss of income therefrom or for damage to the other's property,
employees, invitees, customers or any other person or thing, nor shall either
party be liable for injury to the persons of the other or their respective
employees, agents or contractors, whether or not such damage or injury arises or
results from the performance or conduct imposed by this Agreement either
directly or indirectly.
ARTICLE IX
TERM OF AGREEMENT
9.1 EFFECTIVE DATE: This Agreement is effective upon its execution
by both parties.
9.2 TERM: This Agreement is intended to convey to Ontro all of
Licensor's rights in the Licensor's Inventions, Licensor's Patent Applications,
Licensor's Marks, Licensor's Copyrights, Licensor's Property and the Licensed
Technology to the full extent of Licensor's legal ability, except as
specifically set forth herein. Accordingly, this Agreement may be terminated
only as follows.
(a) Upon the written consent of all parties to the Agreement;
(b) Upon completion of any proceedings in bankruptcy or in reorganization
or for the appointment of a permanent receiver or trustee or any other
proceeding under any law for the relief of debtors by or against Ontro or if
Ontro shall make an assignment for the benefit of its creditors; or
(c) Upon the cessation of business by Ontro or its dissolution and
liquidation.
9.3 DUTIES OF PARTIES UPON TERMINATION: Upon termination of this
Agreement, Ontro shall furnish Licensor with a final accounting and pay all
royalties due in the manner otherwise described in this Agreement. Upon
termination of this Agreement, Ontro shall return to Licensor all of the
Licensor's Property. If this Agreement is terminated, all sub-licenses shall
also terminate automatically subject only to Ontro's right to sell all inventory
on hand at the time of termination.
ARTICLE X
MISCELLANEOUS PROVISIONS
10.1 MEETINGS: Each party shall have the right to call meetings with
the other, to be held at Ontro's primary place of business or such other
location as the parties may agree, not more frequently than quarterly, provided
that the party calling the meeting furnishes at least fourteen (14)
days Written Notice to the other party, to review matters relating to the terms
and conditions of this Agreement and the compliance of each of the parties
therewith and to consider any special matter of concern.
10.2 CONFLICTS: Each party represents and warrants to the other that
neither the execution and delivery of this Agreement nor the consummation of the
transactions contemplated hereunder
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will violate or constitute a default under any agreement or instrument to which
either Ontro or Licensor is a party or by which either is bound.
10.3 ENTIRE AGREEMENT; AMENDMENT: This Agreement contains the entire
understanding between the parties with respect to the subject matter hereof and
supersedes all prior contemporaneous written or oral negotiations and agreements
between them regarding the subject matter hereof. This Agreement may be amended
only by a writing signed by both of the parties and clearly designated as an
amendment to this Agreement by an appropriate heading.
10.4 SEVERABILITY: If any provision or portion thereof of this
Agreement is determined to be invalid or unenforceable, the provision or portion
shall be deemed to be severable from the remainder of this Agreement and shall
not cause the invalidity or unenforceability of the remainder of this Agreement.
10.5 NO IMPLIED WAIVERS: The failure of either party at any time to
require performance by the other party of any provision hereof shall not affect
in any way the right to require such performance at any later time, nor shall
the waiver by either party of a breach of any provision hereof be taken or held
to be a waiver of such provision.
10.6 ATTORNEYS FEES: If any arbitration or legal proceeding is
brought for the enforcement of this Agreement, or because of an alleged breach,
default or misrepresentation in connection with any provision of this Agreement
or other dispute concerning this Agreement, the successful or prevailing party
shall be entitled to recover reasonable attorneys fees incurred in connection
with such arbitration or legal proceeding.
10.7 ARBITRATION: Any controversy of claim arising out of or relating
to this Agreement shall be settled by binding arbitration conducted in
accordance with the Commercial Rules of the American Arbitration Association
("AAA"), and judgment upon any award rendered in such arbitration may be entered
in any court having jurisdiction, regardless of whether one of the parties fails
or refuses to participate. Any dispute in which monetary damages greater than
one-hundred thousand dollars ($100,000) are alleged or in which injunctive
relief or specific performance is requested shall be heard by a panel of three
arbitration judges, which shall have the power to grant requests for injunctive
relief and specific performance.
10.8 GOVERNING LAW: This Agreement shall be construed and interpreted
under the laws of the State of California. All disputes or controversies or
questions arising under or relating to this Agreement between the parties hereto
in relation to this Agreement shall be construed and resolved under the laws of
the State of California. Any judgments upon the award entered by the
arbitrators may be entered in the State or Federal Courts situated in the State
of California.
10.9 COUNTERPARTS: This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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10.10 CAPTIONS: The captions of the sections and subsections of this
Agreement are included for reference purposes only and are not intended to be a
part of the Agreement or in any way to define, limited or describe the scope or
intent of the particular provision to which they refer.
10.11 ASSIGNMENT: Ontro may only assign this Agreement with the prior
written consent of IHI, which consent shall not be unreasonably withheld.
Intending to be legally bound, the parties have executed this Agreement
this ____________ day of _________________________, 1997.
Licensors: Ontro:
INSTA-HEAT, INC. ONTRO, INC.
a California corporation a California corporation
By: By:
--------------------- ---------------------
Title: Title:
------------------ ------------------
-----------------------------------
Xxxxx X. Xxxxxxx, individually
-----------------------------------
Xxxxx X. Xxxxxxxx, individually
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