1
Exhibit 10.9
[ICER CORPORATION LOGO]
THIS AGREEMENT is made this 15th day of October, 1993 between Xx. Xxxx X. Cover
(hereinafter called "Mr. Cover"), and ICER Corporation (hereinafter called
ICER), an Arizona Corporation.
WITNESSETH:
WHEREAS, Mr. Cover has critical skills and industry knowledge material to
the development and marketing of products relating to the business of ICER
NOW, THEREFORE, the parties agree as follows:
ARTICLE I: SCOPE OF THE AGREEMENT
1. Mr. Cover agrees to join the management team of ICER Corporation as an
officer and director of the company for one (1) year full time
employment. His position will encompass responsibility for technology
and product development, but will not be limited to such areas.
2. In accordance with his position with ICER, Mr. Cover agrees not to
engage in independent business relations with competitors of ICER
wherein:
i) Competitors of ICER are defined as companies engaged in the
manufacture and/or design of electronic weapons that are less than
fourteen inches in length and are non lethal.
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ICER CORPORATION COVER AGREEMENT
ii) Independent business relations are defined as any fee for service
arrangement, or any product development work with competitors as
defined in i).
iii) Independent business relations do not include any work or
relationships conducted within the framework of Mr. Cover's
representation of ICER.
iv) Mr. Cover is free to leave unaltered the licensing arrangements
already in existence with such competitors and to pursue
compensation from such competitors for the use of his existing
patents at his discretion.
v) The provisions of this section shall remain in full force and effect
for the period of Mr. Cover's employment with ICER.
vi) Breach of this agreement wherein Mr. Cover engages in independent
business relations with competitors of ICER during the period
described in iv), will result in the forfeiture of Mr. Cover's
remaining stock options and the immediate termination of his
employment with ICER.
3. Mr. Cover agrees to license ICER Corporation: Rights to utilize the
TASER trademark in conjunction with product marketing and other business
functions. Further, Mr. Cover agrees not to license the use of the TASER
trademark to any company not already licensed for such use (see addendum
I).
4. Mr. Cover will provide ICER with a comprehensive listing of his existing
patents and trademarks to be attached as an addendum to this document
(addendum I). Such listing will include the names and addresses of all
licensed entities, and all renewal rights for such licensing for said
patents and trademarks.
5. All technical designs and intellectual property generated during Mr.
Cover's work with ICER will be work-made-for-hire or assigned to ICER
and will be the exclusive property of the Company.
6. Mr. Cover affirms that he has complete authority over the patents and
trademarks in the agreement and that he is free to enter into this
agreement without any hindrance from or violation of prior commitments.
Mr. Cover further affirms that he is not bound by non-disclosure or
trade secret protection clauses which would inhibit him from fully
applying his knowledge to his work at ICER. Accordingly, Mr. Cover
indemnifies ICER from any damages
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ICER CORPORATION COVER AGREEMENT
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resulting from litigation regarding prior commitments which would preclude
him from having entered into this agreement.
7. Mr. Cover agrees not to disclose the confidential information of ICER
Corporation without clear consent from the other members of management.
Such information will include any information which is clearly designated
as confidential, including trade secrets developed, marketing plans,
manufacturing know how, financial or other data which is designated as
confidential.
ARTICLE II: COMPENSATION
1. Mr. Cover will be paid a salary of $2,500 per month during the time of his
full time employment with the Company.
2. Mr. Cover will receive stock options for 10,000 shares of ICER Corporation
representing ten (10) percent of the company with the following vesting
schedule:
2,500 shares at initiation of this agreement
2,500 shares upon completion of functional prototype
2,500 shares at first shipment of product to market
2,500 shares on Oct. 15, 1994 (1 year).
3. These options will have a strike price of $0.36 (thirty six cents per
share) and a time to expiration of 5 years during Mr. Cover's continued
involvement with the company.
4. Further, Mr. Cover will receive a cash bonus in the amount of the exercise
price of the stock options at the date and time of each stock option
vesting that can be used only for exercising the above stock options.
5. Mr. Cover's equity position (via stock options) is guaranteed not to be
diluted below ten (10) percent through the first $250,000 of invested
capital.
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ICER CORPORATION COVER AGREEMENT
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ARTICLE III: CONTINGENCIES
1. Xxxxxxx X. Xxxxx and Xxxxxxxx X. Xxxxx may elect to discontinue the
activities of the corporation upon 2 weeks' notice to Mr. Cover. Under such
circumstances, Xx. Xxxxxxxx X. Xxxxx will have the right to reclaim the
liquid assets of the company not to exceed the amount of his cumulative
investment. Further, from date of such notice Mr. Cover will have the right
to use his skills and trademarks for whatever purpose he desires.
2. Mr. Cover may elect not to continue his work with the Company with 2 weeks'
notice. Mr. Cover would retain all vested options with right to exercise
for 6 months from the date of departure from the company. Unvested options
would be forfeited, and the corresponding shares would remain the property
of the Company.
3. In the event that Mr. Cover should not be able to exercise power of
attorney over the equity in his name while the company is privately held
(i.e. the shares are not on the public market), the Corporation would have
option to repurchase such shares within 6 months from Mr. Cover's estate or
heirs for an amount equal to the greater of:
i) The book value of such shares calculated by standard accounting
practices
ii) $10 per share
iii) Amounts solicited from competitive bidders.
AGREED,
By: /s/ Xxxxxxx Xxxxx By: /s/ Xxxx X. Cover
----------------------- -----------------------
Xxxxxxx Xxxxx Xxxx X. Cover
For ICER CORPORATION
Dated: 10/15/93
--------------------
[SEAL]
CORPORATE SEAL
5
AMENDMENT TO LICENSING AGREEMENT
THIS AMENDMENT TO LICENSING AGREEMENT ("AMENDMENT") is made and entered
into this 31st day of August, 1996, by and between Xxxx X. Cover, Jr. ["XXXX
COVER"] and Air Taser, Incorporated f/k/a/ ICER Corporation, an Arizona
corporation ["AIR TASER"].
In consideration of the covenants and agreements hereinafter set forth,
the amounts of money paid in accordance herewith, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
that certain Licensing Agreement dated October 15, 1993 ("LICENSE") is hereby
amended as follows:
1. AIR TASER hereby agrees to pay to XXXX COVER and XXXX COVER hereby
agrees to accept the sum of One Hundred Thousand Dollars ($100,000) in full
payment and satisfaction of any and all minimum royalties and earned royalties
now due or hereinafter accruing to XXXX COVER from AIR TASER pursuant to the
terms of the LICENSE as originally executed or as subsequently modified or
amended, in writing, prior to the date hereof. Said payment shall be made
contemporaneously with the full execution and delivery of this AMENDMENT by
each of the parties hereto.
2. XXXX COVER, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, for: (i) himself, (ii) his heirs,
(iii) his legal representatives, legatees, successors and assigns of all of the
foregoing persons and entities, hereby releases and forever discharges AIR
TASER, any past, present and future shareholders, successors, assigns, officers,
directors, agents, attorneys and employees of AIR TASER, together with their
respective heirs, legal representatives, legatees, successors, and assigns, of
and from all actions, claims, demands, damages, debts, losses, liabilities,
indebtedness, causes of action either at law or in equity and obligations of
whatever kind or nature, whether known or unknown, direct or indirect, new or
existing, by reason of any matter, cause or thing whatsoever from the beginning
of the world to the date hereof concerning any minimum of earned royalties which
are now due or which may hereafter accrue to XXXX COVER pursuant to the terms of
the LICENSE.
3. This AMENDMENT embodies the entire agreement between the parties and
supersedes any prior agreements or understanding between them in connection
with the subject matter hereof and the transactions contemplated hereby. There
are no oral or parol agreements, representations, or inducements existing
between the parties relating to this transaction which are not expressly set
forth herein and covered hereby. All terms of this AMENDMENT are contractual
and not mere recitals and shall be construed as if drafted by all parties
hereto. The terms of this AMENDMENT are and shall be binding upon each of the
parties hereto, their agents, employees successors and assigns, and upon all
other persons
-1 of 2-
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claiming any interest in the subject matter hereof through any of the parties
hereto.
4. To the extent that this AMENDMENT contradicts, is inconsistent or in
conflict with any prior agreements between or among any or all of the parties,
this AMENDMENT supersedes any conflicting or inconsistent provision of any prior
agreement and is controlling to the extent necessary to resolve such conflict or
inconsistency. Any and all provisions in a prior agreement not inconsistent with
this AMENDMENT remain valid and binding.
5. It is acknowledged that the parties hereto have read this AMENDMENT
and consulted counsel before executing same; that they have relied upon their
own judgment and that of their respective counsel in executing this AMENDMENT
and have not relied on or been induced by any representation, statement or act
by any other party referred to in this instrument; that the parties hereto have
entered into this AMENDMENT voluntarily, with full knowledge of its
significance; and that this AMENDMENT is in all respects complete and final.
6. If any term or provision of this AMENDMENT or the application thereof
to any person, entity or circumstance shall, to any extent, be held invalid
and/or unenforceable by a court of competent jurisdiction, the remainder of this
AMENDMENT, or the application of such term or provisions to persons, entities or
circumstances other than those as to which it is held invalid or unenforceable
shall not be affected thereby, and each term and provision of the AMENDMENT
shall be valid and be enforced to the fullest extent permitted by law.
7. This AMENDMENT may not be amended, changed, or modified except by
written instrument executed by all parties hereto.
8. This AMENDMENT shall be construed and enforced according to the laws
of the State of Arizona.
9. This AMENDMENT may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which together shall constitute
but one instrument.
IN WITNESS WHEREOF, the parties have caused this AMENDMENT to be duly
executed as of the day and year first above written.
AIR TASER, INCORPORATED
By: /s/ Xxxxxxx Xxxxx /s/ Xxxx X. Cover, Jr.
----------------- ------------------
Xxxx X. Cover, Jr.
00 Xxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
Title: President
--------------
-0 xx 0-
0
0xx XXXXXXXXX TO THE AIR TASER LICENSING AGREEMENT
This 2nd Amendment to the AIR TASER licensing agreement (2nd Amendment) is
made and entered into this 31st day of August, 1996, by and between Xxxx X.
Cover, Jr. ["XXXX COVER"] and AIR TASER, Incorporated f/k/a ICER Corporation, an
Arizona Corporation ["AIR TASER"].
In consideration of the covenants and agreements hereinafter set forth,
the amounts of money paid in accordance herewith, and other good and valuable
considerations, the receipt and sufficiency of which are hereby acknowledged,
that certain Licensing Agreement dated October 15, 1993 ["LICENSE"] is hereby
amended as follows:
1. AIR TASER hereby agrees to pay to Xxxx Cover, and Xxxx Cover hereby agrees to
accept the sum of FIFTEEN THOUSAND DOLLARS ($15,000) in full payment for a
limited exclusivity for rights to technology embodied in U.S. patent
#5,078,117 ["The '117 Patent"]. In accordance with this limited exclusivity,
Xxxx Cover agrees that he shall license no other company, person, or entity
of any type to utilize the technology described in the '117 patent for use in
electronic weapon system other than the companies licensed for such use prior
to this 31st day of August, 1996. These pre-existing licenses are non
transferable and shall not be transferred to any entity other than the
original license holder as enumerated below. Further, Mr. Cover shall not
expand or modify the rights of the existing licensees, as listed below,
without written approval from AIR TASER, Inc. A comprehensive listing of such
licensed companies is given below:
a) EESTI, Engineering, LLC, a company in Poway, CA. (Copy of license
attached as Exhibit A.)
b) Xxxx Xxx Park, d.b.a. Bestex, Co. (Copy of license addendum regarding
'117 patent rights attached as Exhibit B.)
2. This agreement in no way binds Mr. Cover from licensing rights to utilize the
'117 technology in applications which are not electronic weapons. Mr. Cover
is free to license any person, company, association, agency, or entity of any
type to utilize the '117 technology so long as the license contains the
specific language below:
"The licensee may not use the technology embodied in U.S. Patent
#5,078,117 in conjunction with any electronic weapon system. The violation
of this restriction shall cause immediate cancellation of this license
without notice, and may cause damages payable to Xxxx X. Cover and/or AIR
TASER, Inc."
3. If any term or provision of this 2nd Amendment or the application thereof to
any person entity, or circumstance shall, to any extent, be held invalid and
or unenforceable by a court of competent jurisdiction, the remainder of this
2nd Amendment, or the application of such term or provisions to persons,
entities, or
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circumstances other than those as to which it is held invalid or
unenforceable shall not be affected thereby, and each term and provision of
the 2nd Amendment shall be valid and be enforced to the fullest extent
permitted by law.
4. This 2nd Amendment may not be amended, changed, or modified except by
written instrument executed by all parties hereto.
5. This 2nd Amendment shall be construed and enforced according to the laws of
the state of Arizona.
IN WITNESS WHEREOF, the parties have caused this 2nd Amendment to be
duly executed as of the day and year first above written.
AIR TASER, INCORPORATED,
By: /s/ Xxxxxxx Xxxxx /s/ Xxxx X. Cover, Jr.
_________________ ______________________
President Xxxx X. Cover, Jr.
00 Xxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
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EXHIBIT A.
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ELECTROARMS, INC.
Xxxx X. Cover, Pres. 602/529-2344
0000 Xx. Xxxx Xx. #00000
Xxxxxx, XX 00000
December 15, 1995
LICENSE AGREEMENT BETWEEN XXXXX XXXXXX, EESTI Engrg, LLC, POWAY, CA,
LICENSEE & XXXX X. COVER, LICENSOR - under Xxx. No. 5,078,117 (generally
covering the use of compressed gas capsules that are easily discharged &
the gas will propell projectiles, weights, contactors, nets, etc., in a
non-firearm mode of operation).
This Agreement specifically pertains to EESTI's manufacture of Taser-type
cassettes designed to snap onto stun guns giving the stun gun owner the
Taser stand-off range & effectiveness in stopping power over dangerous
criminals.
More specifically this License relates to X.X. Cover's License with Eastex
Co., Xxxx Xxxx, who imports & sells the Thunder Power - and other stun guns
- which will be used in conjunction with the EESTI SGA Cassettes containing
the SPOGC's.
In return for this Exclusive License to EESTI, X.X. Cover will receive an
Earned Royalty from Xxxxx Xxxxxx, EESTI, of $0.25 - or 25(cents) @ for each
SGA Cassette they Make & Sell.
In summary, the Licensor, Xxxx X. Cover, hereby grants an Exclusive License
under Patent #5,078,117 to Xxxxx Xxxxxx, d.b.a. EESTI Engineering, LLC, to
manufacture and sell the Stun Gun/SGA Taser Cassettes as the Exclusive
Licensee.
Signatures below constitute the legal acceptance by the two Parties of the
above Terms & Conditions.
/s/ Xxxxx Xxxxxx 2-19-96 /s/ Xxxx X. Cover 12/15/95
----------------------------- ------------------------------
Xxxxx Xxxxxx, Licensee - Date Xxxx X. Cover, Licensor - Date
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EXHIBIT B.
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ELECTROARMS, INC. 619/423-0689
00 Xxxx Xxxx Xxxx, Xxxxxxxx, XX 00000 December 1, 1998
Xxxx X Xxxx, Pres. Subject: License Addendum covering
Bestex Co., Unit B Bestex Sale of a Stun Gun
0000 Xxx Xxxxxxxx Xx. Adaptor/SGA designed for the Thunder
Xxx Xxxxxxx, XX 00000 Power Stun Gun.
ADDENDUM TO THE LICENSE AGREEMENT signed by Xxxx Xxx Park, d.b.a. Bestex Co.,
3/7/90 & Xxxx X. Cover, Licensor, on 2/19/90.
Licensor hereby grants an Exclusive License to distribute and sell the SGA
Taser Cassettes designed to "snap" onto the front of the Bestex Thunder Power
Stun Gun modified to function with the SGA -- which projects the high voltage
electric contactors at an attacker -- such that the user does not receive a
shock to this hand (insulation)
This License is under X.X. Cover's Patent #5,078,117 covering the
Self-Puncturing Compressed Gas Capsule. This technology permits the use of
compressed air to propell the contactors & is therefore not classified as a
Firearm. EESTI, Xxxxx Xxxxxx, Poway, CA will make the SGA under my Patent
License & supply them to Bestex.
The Terms for Bestex's Exclusivity are: 1)$20,000 upfront ($10,000 upon
execution of the License -- 1st week of March, 1996 -- and $10,000 April 1,
1996), 2) Bestex's Minimum Royalty will be $2500/mos starting 4/2/96, and 3)
Bestex will pay X.X. Cover $2 Earned Royalty for each Thunder Power Stun Gun
sold(or any modification or substitution thereof that fits the SGA) and
25(cents) for each SGA Cassette sold.
It is important that Xxxx Xxxx, Xxxxx Xxxxxx & Xxxx Cover work as a team on
this program. There are decisions to be made such as the Packaging of the
Product -- the Thunder Power & (2) SGA cassettes in a box -- sales and
advertising strategies including the name of the Product. "Public Defender" and
ElectroStorm(stop rape & murder) are possibilities. An early meeting such as
the first week in December is suggested. Xxxx Cover will consult as needed
without compensation.
The signatures below constitute the legal acceptance of the two parties of the
above terms & conditions.
/s/ Xxxx Xxx Park, 12/18/95 /s/ Xxxx X. Cover 12/15/95
----------------------------- ----------------------------
Xxxx Xxx Park, Licensee - Date Xxxx X. Cover, Licensor
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8/31/96
AIR TASER INCORPORATED
Rec'd $15,000 for 2nd Amendment Compensation
/s/ X.X. Cover
--------------
X.X. Cover
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[SPECIMEN STOCK CERTIFICATE]
[AIR TASER LOGO]
INTELLIGENT SELF DEFENSE
Number Shares
00004 50,000
AIR TASER INCORPORATED
Share Issue Authorized by /s/ illegible /s/ illegible
------------- -------------
President Secretary
THIS CERTIFIES THAT Xxxx X. Cover is the registered holder of Fifty Thousand
(50,000) Shares transferrable only on the books of the Corporation by the
holder hereof in person or by Attorney upon surrender of this Certificate
properly endorsed.
IN WITNESS WHEREOF, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and its Corporate Seal to be Hereunto
affixed
this Seventeenth day of June A.D. 1994
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[SPECIMEN STOCK CERTIFICATE]
[SEAL]
FOR VALUE RECEIVED, I hereby sell, assign and transfer unto AIR TASER, INC.
____________ Shares represented by the within Certificate, and do hereby
irrevocably constitute and appoint XXXXXXX XXXXX Attorney to transfer the said
Shares on the books of the within named Corporation with full power of
substitution in the premises.
Dated AUGUST 31, 1994
In presence of
/s/ illegible /s/ Xxxx X. Cover
----------------------- -----------------------
Xxxx X. Cover
00 Xxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
NOTICE: THE SIGNATURE OF THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATEVER.
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LICENSING AGREEMENT
1. CONSIDERATION; EFFECTIVE DATE
1.1 The effective date of this agreement shall be Oct. 15, 1993.
2. PARTIES
2.1 Xxxx X. Cover is an individual with business located at Xxx 000, 0000
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxxx 00000 (LICENSOR)
2.2 ICER Corporation is an Arizona Corporation engaged in the development
of non lethal electronic weapons for sale to the general consumer market
(LICENSEE).
3. BACKGROUND
3.1 Licensor represents and warrants that he owns several patent rights,
both domestic and foreign as listed on Exhibit "A" though not in every
country of the world, and specifically U.S. Patent Number 4,254,132 and
5,078,117, (the Licensed Patents) concerning a power supply and ballistics
launching mechanism for weapons or other devices utilizing electricity for
immobilization purposes.
3.2 Licensor is not aware of any ownership of another of inventions or
patent rights or trade secret or know-how rights in conflict with his own;
and Licensor believes that he possesses such right, title and interest in
and to the electronic immobilization devices and equipment useful therein
as is necessary and appropriate to the terms of this agreement.
3.3 Licensee is a company seeking to develop such technology for
manufacture and marketing an alternative non lethal self defense device to
firearms.
3.4 Any other concepts, advanced technologies or other patents Licensor now
possesses or might obtain in the future are specifically excluded from this
agreement. HOWEVER, SUCH TECHNOLOGIES MAY BE COVERED IN SEPARATE
ARRANGEMENTS SPECIFYING CONTRACT AND SALARIED WORK.
4. LICENSE
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ICER CORPORATION COVER AGREEMENT
4.1 Licensor hereby grants Licensee a non exclusive license for use of
patent number 4,254,132 and the electric wave form and power generator
described therein. Under said licensed patent to manufacture, use and sell
devices, with and without launching mechanisms covered by patent number
4,254,132.
4.2. LICENSOR HEREBY GRANTS LICENSEE LICENSE FOR PATENT 5,078,117. LICENSOR
IS LICENSED UNDER SAID PATENT TO MANUFACTURE, USE AND SELL DEVICES COVERED
BY PATENT 5,078,117. THIS LICENSE WILL BE EXCLUSIVE FOR DEVICES WHICH MEET
ALL OF THE FOLLOWING CHARACTERISTICS:
i) ELECTRONIC WEAPONRY DESIGNED TO IMMOBILIZE
ii) WEAPON AS IN i) WHEREIN THE GREATEST DIMENSION OF THE WEAPON IS
OF LESS THAN FOURTEEN INCHES.
iii) A WEAPON WHICH IS DESIGNED TO BE NON LETHAL
iv) A WEAPON DESIGNED FOR USE AGAINST HUMANS
THIS EXCLUSIVITY BINDS LICENSEE TO ENSURE THAT ANY FURTHER LICENSING
OF PATENT 5,078,117 DESCRIBES CLEARLY THAT THE LICENSING OF PATENT
5,078,117 DESCRIBES CLEARLY THAT THE LICENSE MAY NOT BE USED FOR
MANUFACTURE OF DEVICES WHICH MEET THOSE FOUR CHARACTERISTICS. THIS
EXCLUSIVITY WILL BE BINDING FOR TWENTY FOUR MONTHS (24). AFTER TWENTY FOUR
MONTHS, THIS EXCLUSIVITY CLAUSE WILL REMAIN IN EFFECT IF THE TOTAL EARNED
ROYALTIES PAID BY LICENSEE TO LICENSOR EXCEEDS $100,000 PER YEAR, USING
MONTHS 12-24 AS THE FIRST YEAR FOR SUCH CALCULATION. SHOULD THE EARNED
ROYALTIES FALL BELOW $100,000 PER YEAR, LICENSOR WILL BE FREE TO LICENSE
PATENT 5,078,117 FOR SIMILAR USE.
4.3. No party shall enter into any contracts or make any warranties on
behalf of the other party.
4.4. Licensee shall not negotiate sub license or assign this license unless
specifically authorized in writing by Licensor. Bona fide sales by Licensee
to bona fide third parties for resale are not sub licensing so long as
these sales are not in violation of Paragraph 6.12 below.
5. TERM OF LICENSE
5.1. The license will be for the period of validity of patent 4,254,132 on
devices utilizing the technology described therein
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ICER CORPORATION COVER AGREEMENT
and for the PERIOD OF VALIDITY of patent 5,078,117 for mechanisms
utilizing the technology described therein.
5.2 Licensee's obligation to pay royalties, as set forth in
Paragraph 6, runs in favor of Licensor's heirs, successors and
assigns.
6. ROYALTIES
6.1 From Oct. 15, 1993 until the expiration of the above described
patents, unless Licensee ceases to make, use, or sell devices covered by
the Licensed Patents, Licensee agrees to pay Licensor a MINIMUM ROYALTY of
Two thousand five hundred and no/100 Dollars ($2,500) per month payable on
the 15th and on the 15th of each and every month thereafter during the
term of this license. Payment of the MINIMUM ROYALTY shall be delinquent
if not paid within 5 days after the due date.
6.2 LICENSEE ALSO AGREES TO PAY AN EARNED ROYALTY TO BE COMPUTED MONTHLY
AND, AFTER REDUCTION BY THE AMOUNT PAID IN CUMULATIVE MINIMUM ROYALTIES
ABOVE CUMULATIVE EARNED ROYALTIES, SAID EARNED ROYALTIES SHALL BE EQUAL TO
TWO DOLLARS PER UNIT ($2.00) FOR EACH UNIT WHICH UTILIZES THE POWER
GENERATION DEVICE AND ELECTRIC WAVE FORM DESCRIBED IN PATENT 4,254,132 AND
$0.25 PER UNIT FOR EACH DEVICE WHICH UTILIZES COMPRESSED GASSES TO LAUNCH
ELECTRICAL CONTACTORS FROM THE POWER GENERATOR. THIS $0.25 EARNED
ROYALTY SHALL REMAIN IN EFFECT FOR THE LIFE OF PATENT 4,254,132 IF IT DOES
NOT UTILIZE THE TECHNOLOGY DESCRIBED IN PATENT NUMBER 5,078,117. IF IT
DOES UTILIZE THE TECHNOLOGY DESCRIBED IN PATENT NUMBER 5,078,117, THEN THE
EARNED ROYALTY SHALL REMAIN IN EFFECT FOR THE LIFE OF SAID PATENT
5,078,117. AN EARNED ROYALTY OF $0.10 WILL BE PAID FOR "PRACTICE
CASSETTES" WHICH UTILIZE THE TECHNOLOGY IN PATENT 5,078,117, WHEREIN
"PRACTICE CASSETTES" ARE DEFINED AS DEVICES WHICH SIMULATE THE ACTION OF
PROPELLING ELECTRICAL CONTACTORS TO A TARGET BUT WHICH ARE
NON-FUNCTIONAL--I.E. ARE NOT RELIABLE CONTACTORS FOR USE IN COMBAT
SITUATIONS.
6.3 Licensee's MINIMUM ROYALTY payment is due on the 15th of each month.
MINIMUM ROYALTY payments are past due five days thereafter. If MINIMUM
ROYALTY payments are not made within five days of the due date, then a
DEFAULT of this agreement occurs automatically and without notice.
Licensee has
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ICER CORPORATION COVER AGREEMENT
payment with a cashier's check or money order for the full amount of the
MINIMUM ROYALTY due. If the DEFAULT is not cured by payment of this MINIMUM
ROYALTY by cashier's check or money order by 5:00 P.M. on the tenth day after
which it is due, this licensing agreement is automatically terminated without
notice.
6.4. Licensee's EARNED ROYALTY payment is due on the fifteenth day of the month
following the month in which the REVENUES FROM SALES WERE RECEIVED. EARNED
ROYALTY payments are past due and delinquent if not paid by 5:00 P.M. on the
twentieth day of SAID MONTH. If EARNED ROYALTY payments are not made by the
twentieth of the month, then a DEFAULT of this agreement occurs automatically
and without notice. Licensee has until the thirtieth of the month to cure the
DEFAULT by payment with a cashier's check or money order for the full amount of
the EARNED ROYALTY due. If the DEFAULT is not cured by payment of this EARNED
ROYALTY by cashier's check or money order by 5:00 P.M. on the thirtieth day of
the month in which it is due, this licensing agreement is automatically
terminated without notice.
6.5. Royalties are payable by Licensee to Licensor at the address of the
Licensor.
6.6. Royalties are payable in U.S. Dollars
6.7. Accompanying each EARNED ROYALTY payment, Licensee will provide to Licensor
the accounting data on the sales of the licensed devices, including any daily
summaries and the monthly summary from which the gross sales figures for the
month are determined.
6.8. Licensee will keep books, accounts, and records that reflect all revenues
and expenditures incurred in connection with the operation of its business. The
books, accounts, and records shall be maintained at the regular place of
business of Licensee. Licensee, during regular business hours, shall make the
books, accounts, and records required to be maintained herein available to
Licensor and/or his designated legal representative for examination and audit by
appointment upon reasonable request and during normal business hours. Licensor
agrees to pay for said examination and audit, however, if said examination and
audit reveals a discrepancy of more than 5% of reported figures, Licensee shall
pay for an examination and audit
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ICR CORPORATION COVER AGREEMENT
6.9. Within sixty days after the end of each calendar year, Licensee
shall prepare and deliver to Licensor a detailed statement of sales during
the calendar year that result from the operations of Licensee's business.
6.10. Licensor agrees that all such information shall be held by its
legal representatives, agents, trustees, attorneys, and accountants in
confidence.
6.11. Licensee will xxxx each of the subject devices with the following
notice: "Licensed under U.S. Patent No. 4,253,132" Or: "Licensed under U.S.
Patent No. 5,078,117" Or both.
6.12. DELETED.
7. INFRINGEMENT OF LICENSOR's PATENTS
7.1. In the event that any party shall become aware of any perceived
infringement or any appropriation of Licensor's patents, trade secrets, or
know how rights in the electronic immobilization devices or equipment,
products or materials useful therein, the party shall give notice thereof
to the other party hereto.
7.2. Licensee agrees to cooperate with any lawful efforts that
Licensor may undertake to seek legal remedies for any such infringements or
misappropriations.
8. INDEMNITIES FOR MALFEANCE, LIABILITY FOR PERSONAL INJURY OR PROPERTY
DAMAGE
8.1. The License herein granted to Licensee is primarily in the
nature of a sharing of information and a covenant not to xxx for
infringements of the Licensor's rights and is not in the nature of a
specification of activities required of the Licensee or of equipment or
process of details required to be used by the Licensee.
8.2. The manufacture, use, and sale of Licensee's products shall be
the sole responsibility of Licensee and/or its agents.
8.3. Accordingly, Licensor shall not be liable for any personal injury
or property damage resulting from the design, construction, or use of the
licensed technology or of the equipment or products used in connection with
the technology, if such injury or damage arises from the activities of
Licensee.
21
ICER CORPORATION COVER AGREEMENT
8.4 In no event shall Licensor be liable for any direct, special,
incidental, or consequential damages, or any damages whatsoever, whether in
an action for contract, negligence, or other tortious action arising out
of, or in connection with, the use of any of the products covered by this
license.
8.5 Licensee shall protect, save, indemnify, and hold Licensor harmless
from all claims, demands, charges, or litigation arising out of the making,
using, or selling of the merchandise and devices produced and sold by
Licensee and arising, directly or indirectly, out of, or by reason of, any
business activities of Licensee. Licensee shall reimburse Licensor for all
loss, damage, or expense, including reasonable attorney's fees (should such
a creature exist), which he may suffer or incur, directly or indirectly, by
reason of any such claims, demands, charges, or litigation. This indemnity
shall extend to and include any claims for personal injuries or damage
caused to persons using the merchandise or devices made or sold by
Licensee.
9. CONTROLLING LAWS
9.1 All questions relating to the validity, interpretation, performance,
or enforcement of this agreement, whether by arbitration or otherwise,
shall be determined in a court with the laws applicable to the State of
Arizona, U.S.A.
10. BINDING EFFECT
10.1 Each and every provision on this license shall bind and shall inure to
the benefit of the parties hereto and their legal representatives.
10.2 The term "legal representatives" means in addition to executors and
administrators, every person, partnership, corporation, or association
succeeding to the interest or to any part of the interest in or to this
license or in the subject matter of this license, of either Licensor or
Licensee, whether such succession results from the act of a party interest,
occurs by operation of law, or is the effect of the operation of the law
together with the act of such a party. Each and every covenant, agreement,
and condition of this agreement to be performed by the Licensee shall be
binding upon all successors in the interest to Licensee.
11. NOTICES
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ICER CORPORATION COVER AGREEMENT
11.1. All notices required herein shall be in writing.
11.2. Written notices may be delivered personally to the president of
the subject party or to the officer or person specified below.
11.3. Written notices shall be deemed to have been effective three days
following the date of mailing by certified mail, postage prepaid, return
receipt requested, addressed to Xxxx X. Cover, Licensor, as follows:
XXX 000
0000 Xxxxxxx Xx.
Xxxxxx, Xxxxxxx 00000
Licensee addressed to:
0000 Xxxx Xxxxxx Xxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
11.4 Each party shall have the right to change the effective address
for a notice by a notice in writing directed to the other party above.
12. ENTIRE AGREEMENT; AMENDMENTS; HEADINGS
12.1 This agreement together with its appendices constitutes the
entire agreement between the parties REGARDING LICENSING OF TECHNOLOGY, and
SUPERSEDES any prior communications ON THE SUBJECT whether written or oral.
12.2 This agreement may be amended or modified only by an instrument
in writing, signed by duly constituted officers of both parties.
12.3 No waiver, no matter how long continuing or how many times
extended, shall be construed as a permanent waiver or as an amendment to
this instrument.
12.4 The marginal headings herein are for purposes of convenient
reference only and shall not be used to construe or modify the terms
written in the text of this instrument.
13. FAILURE TO PERFORM
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ICER CORPORATION COVER AGREEMENT
13.1. Licensee, as well as its successors in interest and or assigns, agrees
that failure to perform in accordance with the terms of this license,
terminates this license and any manufactures, use, or sale of devices covered
by the Licensed Patents, with or without launching mechanisms, thereafter is
without license.
AGREED,
By: /s/ Xxxxxxx Xxxxx By: /s/ Xxxx X. Cover
----------------------- -----------------------
Xxxxxxx Xxxxx Xxxx X. Cover
For ICER CORPORATION
Dated: 10/15/93
--------------------
CORPORATE SEAL
[SEAL]
