MANUFACTURING LICENSE AGREEMENT
This AGREEMENT is made this Ist day of January, 1998, by and between Xxxxxx
Xxxxx, 000 X.X. Xxxxxxxxx: Xxxx, Xxxxxxxxx, Xxxxxxxx, 00000 (hereinafter the
"Licensor") and Xxxxx Technology Licensing, Incorporated, a Florida Corporation
located at 000 Xxxx Xxx Xxxxx, Xxxxx 000, Xxxxx, Xxxxxxx, 00000 (hereinafter
"TTL" or the "Licensee").
WHEREAS the Licensor has made certain new and useful inventions including
the AllenLift Pump (Xxxxx Lift), a pumping device for oil xxxxx, and desires to
have the invention commercially used through the granting of a license to
manufacture; and
WHEREAS, the Licensee is a Florida corporation organized for the principal
purpose of developing technologies similar to the Xxxxx-Lift and now desires to
acquire a license to manufacture the mechanical components, coordinate assembly
and delivery for the Xxxxx-Lift; and
WHEREAS, the Licensor has previously granted a license to New Lift, Inc.,
an Oklahoma corporation, who has in turn granted one sub-license (hereinafter
the "New Lift License").
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto do hereby agree as follows:
1. The Licensor hereby licenses and empowers the Licensee to manufacture a
pumping device for oil xxxxx designed by Licensor in accordance with plans and
specifications for said pump developed by Licensor, subject to the conditions
hereinafter set forth at Licensee's facilities in the Pinellas Science
Technology and Research Center in Tampa, Florida. Licensee shall not have the
right to grant sublicenses of this Agreement. Nothing contained or construed to
be contained in this Agreement shall constitute the grant by Licensor of any
right by way of license or otherwise to Licensee to use any trademark or trade
name of Licensor without the prior written consent of Licensor, which may be
withheld by Licensor in his sole and absolute discretion .
2. The Licensee shall make full and true returns to the Licensor under oath
on the first days of January and July of each year of all Xxxxx Lifts
manufactured by Licensee pursuant to this Agreement during the preceding six
months.
3. Licensee shall pay to Licensor as a license fee (hereunder "License
Fee") for each Xxxxx Lift manufactured for delivery the sum of six percent (6~~)
of the Net Sales Price (as such term is hereinafter defined) received by the
Licensee which sale shall be deemed to occur on the date of invoice, shipment or
delivery of Xxxxx Lifts during the term of this Agreement. For purposes hereof,
the term "Net Sales Price" shall mean the gross sales priced charged to a
purchaser of an Xxxxx Lift less (to the extent included and separately itemized
in the gross sales price): (i) transportation, handling, insurance, taxes and
other similar charges, and (ii) rebates and other allowances actually paid or
allowed; provided, however, no deduction shall be made for commissions, costs of
collection, bad debts, returns or similar items.
4. The Licensee agrees to pay to the Licensor the License Fee according to
the following schedule:
a. An advance first year License Fee payment of Eighty-Thousand and No/100
Dollars ($80,000.00) payable in four equal installments of Twenty Thousand and
No/100 Dollars ($20,000.00) each with the first payment being made upon the
execution of this Agreement. The second payment shall be made upon the latter
of: (i) the payment of the purchase price of the first three Xxxxx Lifts
manufactured pursuant to the agreement or (ii) three months from the date of
this Agreement. In the event that the second payment is made pursuant to this
paragraph 4 a., the third and fourth payments shall be made six months and nine
months from January 1, 1998. Such advance License Fee payment will thereafter be
applied toward any amounts due Licensor under paragraph 3 above.
b. Thereafter, License Fee payments shall be made quarterly as computed for
the periods ending March 31, June 30, September 31 and December 31 of each
annual Period this Agreement remains in force. License Fee payments shall be
computed as set forth in paragraph 3 of this Agreement.
c. Licensee shall keep and maintain complete and accurate records and
documentation concerning all sales or other dispositions of Xxxxx Lifts and
shall retain such records and documentation for not less than seven (7) years
from the date of their creation.
d. Licensor and his representatives and agents shall have the right during
the term of this Agreement and for a period of one (1) year thereafter upon
reasonable notice to Licensee to inspect during regular business hours the
records and documentation required to be retained pursuant to this Agreement.
(62)
e. The costs of any inspection pursuant to this paragraph 4 shall be borne
by Licensor, unless as a result of such inspection it is determined that the
amounts payable by Licensee to Licensor for any period are in error by greater
than five percent (5R), in which case the costs of such inspection shall be
borne by Licensee. Licensor shall report the results of any such inspection to
Licensee, and Licensee shall promptly thereafter pay to Licensor the amount of
any underpayment, and the amount of any overpayment shall be credited by
Licensor against future amounts payable by Licensee to Licensor. In addition,
Licensee shall pay interest on the amount of such underpayment at ten percent
(10~~) per annum.
5. In the event that the Licensee fails to make returns or to make payment
as hereinafter provided by thirty (30) days after the dates herein specified,
the Licensor may, at his option, terminate this Agreement by giving notice in
writing thereof to the Licensee by certified mail addressed to such Licensee at
its address herein set forth.
6. In the event that the Licensor terminates this Agreement as provided in
this Agreement, Licensor shall thereafter have the right to enter into any
agreement which he deems proper with any other person, firm or corporation for
the licensing or assignment of the Xxxxx Lift to any other person, firm or
corporation for the manufacture of the Xxxxx Lift and the Licensee shall
thereafter have no right to manufacture the Xxxxx Lift. Upon the termination of
this Agreement for any reason, the Licensee shall promptly and without demand
from Licensor, deliver to Licensor all plans, specifications, memorandum and
documents of any kind or nature relating to the manufacture of the Xxxxx Lift.
7. The Licensee shall endeavor in every reasonable and proper way and to
the best of its ability to further the manufacture of the Xxxxx Lift in such
manner as may seem necessary and shall be prepared to manufacture not less than
one hundred (100) Xxxxx Lifts in the first year of this Agreement and not less
than three hundred (300) Xxxxx Lifts in any subsequent year of this Agreement.
8. Licensee shall xxxx all Xxxxx Lifts which are made, sold or otherwise
disposed of by Licensee under this Agreement in such manner as is required to
protect or preserve Licensor's rights to the Xxxxx Lift under applicable law
and/or as is customary in the market and no Xxxxx Lift shall be sold without
such label or plate.
9. Each party acknowledges that this Agreement may require the disclosure
by one party to the other party of its confidential and proprietary information
("Confidential Information"). Each party shall regard and preserve Confidential
Information as secret and confidential, and during the term of this Agreement
and for a period of ten (10) years thereafter neither party shall publish or
disclose any Confidential Information in any manner without the prior written
consent of the other party. Each party shall use the same level of care to
prevent the disclosure of the Confidential Information of the other party that
it exercises in protecting its own Confidential Information and shall in any
event take all reasonable precautions to prevent the disclosure of Confidential
Information to any third party.
10. Neither party shall without the prior written consent of the other
party, disclose to any third party the existence of this Agreement or any of its
provisions unless such disclosure is required under applicable law or in
connection with legal enforcement of this Agreement.
11. Neither party shall publish or arrange for the publication in any
scientific, trade or other publication information concerning the Xxxxx Lift
without the prior written consent of the other party which consent may not be
unreasonably withheld.
12. Each party acknowledges that in the event of any breach or default or
threatened breach or default by either party of paragraphs 9, 10 and 11 of this
Agreement, the other party may be irreparably damaged and that it would be
extremely difficult and impractical to measure such damage, so that the remedy
of damages at law would be inadequate. Consequently, each party acknowledges and
agrees that the other party, in addition to any other available rights or
remedies, shall, without the necessity of posting any bond or similar security,
be entitled to specific performance, injunctive relief and any other equitable
remedy for the breach or default or threatened breach or default of said
paragraphs 9, 10 and 11 of this Agreement, and each party waives any defense
that a remedy at law or damages is adequate.
13. Each party represents and warrants to the other party that this
Agreement has been duly authorized, executed and delivered by each party and
that this Agreement is a binding obligation of each party, enforceable in
accordance with its terms, subject, as to enforcement of remedies, to applicable
bankruptcy, insolvency, moratorium, reorganization or other similar laws
affecting creditors' rights generally, and to general equitable principles.
14. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, LICENSOR MAKES NO
REPRESENTATIONS OR WARRANTIES, EITHER EXPRESS OR IMPLIED INCLUDING WITHOUT
LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE OR ANY EXPRESS OR IMPLIED WARRANTY THAT THE USE OF THE XXXXX LIFT, OR
THE IMPROVEMENTS OR THE MANUFACTURE, USE OR SALE OF ANY OF THE XXXXX LIFT WILL
NOT INFRINGE ANY PATENT, COPYRIGHT OR OTHER RIGHT OF ANY THIRD PARTY), OF ANY
KIND OR NATURE WHATSOEVER.
(63)
The Licensor has retained patent counsel to conduct a patent search and has
received an opinion letter from patent counsel stating that the invention, as
broadly described, would be patentable.
15. Licensee shall indemnify, hold harmless and defend Licensor and his
heirs, personal representatives, successors and assigns, from and against any
and all claims, demands, lawsuits, actions, proceedings, liabilities, losses,
damages, fees, costs and expenses (including without limitation attorneys' fees
and costs of investigation and experts) resulting from or arising out of the
manufacture, assembly or delivery of any of the Xxxxx Lifts or the exercise by
Licensee of any right granted hereunder, including without limitation any
liabilities, losses or damages whatsoever with respect to death or injury to any
individual or damage to any property arising from the possession, use or
operation of the Xxxxx Lift by Licensee or any third party in any manner
whatsoever.
16. Licensee shall maintain at all times during and after the term of this
Agreement, comprehensive general liability insurance, including product
liability insurance, with reputable and financially secure insurance carriers
and having commercially reasonable limits giving due consideration to the nature
and extent of such activities and the risks inherent therein to cover the
activities of Licensee contemplated by this Agreement. Any such insurance shall
have Licensor as an additional named insured party and shall provide for no
cancellation or material alteration except upon at least thirty (30) days prior
written notice to Licensor, Licensee shall timely provide Licensor with
certificates of insurance evidencing such coverage.
17. The Licensee agrees to act exclusively to manufacture the mechanical
portions of the Xxxxx Lift and shall not make any efforts to promote or exploit
the sale of the equipment.
18. This Agreement shall become effective on the date first above written
and shall remain in effect until December 31, 2002, unless sooner terminated
pursuant to the terms of this Agreement.
19. This Agreement may be terminated by either party if the other party
breaches any material provision hereof (including without limitation any
provision requiring payment by Licensee to Licensor), provided that termination
may only take place if (i) the claiming party has given the breaching party
written notice specifying the respects in which the claiming party claims this
Agreement has been breached and (ii) the breaching party fails to remedy such
breach within thirty (30) days after receiving such notice.
20. Upon the termination or expiration of the term of this Agreement, the
license granted by Licensor to Licensee pursuant to paragraph 1 hereof shall
terminate. Notwithstanding any termination or expiration of the term of this
Agreement, Licensee shall be permitted for a period of not more than three (3)
months to sell all Xxxxx Lifts then in inventory and shall have the obligation
to pay Licensor all amounts which have accrued or shall accrue by reason of the
sale of such Xxxxx Lifts. Licensee shall not be entitled to any refund of any
amounts by reason of any termination or expiration of the term of this
Agreement. Upon termination of this Agreement for any reason, the Licensee shall
not engage in the manufacture of Xxxxx Lifts or any derivative or copy thereof
nor shall Licensee or any subsidiary of Licensee solicit any customers of
Licensor or directly or indirectly induce any employee of Licensor to leave his
employee for a period of five (5) years after the date of termination of this
Agreement.
21. The rights and obligations of Licensee shall not be assignable without
the prior written consent of Licensor which consent may be granted or withheld
by Licensor in his sole and absolute discretion.
22. Any notice or other communication hereunder must be given in writing
and either (i) delivered in person, (ii) transmitted by telex, facsimile or
telecopy mechanism provided that any notice so given is also mailed as provided
herein, (iii) delivered by Federal Express or similar commercial delivery
service or (iv) mailed by certified mail, postage prepaid, return receipt
requested, to the party which such notice or communication is to be given at the
address set forth on the first page of this Agreement or to such other address
or to such other person as either party shall have last designated by such
notice to the other party. Each such notice or other communication shall be
effective (i) if given by telecommunication, when transmitted, (ii) if given by
mail, seven (7) days after such communication is deposited in the mails and
addressed as aforesaid, (ii) given by Federal Express or similar commercial
delivery service three (3) business days after such communication is deposited
with such service and addressed as aforesaid, and (iv) given by any other means,
when actually delivered at such address.
23. This Agreement and the legal relations between the parties shall be
governed by and construed in accordance with the laws of the State of Oklahoma.
24. In any action between the parties seeking enforcement of any of the
provisions of this Agreement, the prevailing party shall be awarded, in addition
to damages, injunctive or other relief, its reasonable costs and expenses, not
limited to taxable costs, and reasonable attorneys' fees.
(64)
25. Neither this Agreement nor any provisions hereof shall be waived,
modified, discharged or terminated except by an instrument in writing signed by
both parties.
26. This Agreement contains the entire agreement of the parties with
respect to the subject matter hereof, and there are no representations,
warranties, covenants or other agreements except as stated or referred to
herein.
27. Each provision of this Agreement is intended to be severable from every
other provision and the validity or legality of the remainder hereof shall
remain valid and binding.
28. This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective heirs, legal representatives,
administrators, executors, and successors, subject, however, to the restrictions
on assignment set forth in this Agreement.
29. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, and such counterparts together shall
constitute one agreement.
IN WITNESS WHEREOF, the undersigned have hereunto set their hands as of the day
and year first above written.
LICENSOR
S/S XXXXXX XXXXX
Xxxxxx Xxxxx
LICENSEE
XXXXX TECHNOLOGY LICENSING, INCORPORATED
By: S/S XXXX X. XXXXX
President
Attest:
S/S XXXX XXXXXX
Secretary (SEAL)
(65)
