EXCLUSIVE PATENT SUB-LICENSE AND ROYALTY AGREEMENT
THIS EXCLUSIVE PATENT SUB-LICENSE AND ROYALTY AGREEMENT
("Agreement") is made as of November 21, 2002 by and between the Estate of Xxxxx
Xxxxxx, Deceased, by and through the Estate's Personal Representative, Xxxxxx
Xxxxxx (hereinafter "Licensor"), having an address at 0000 XX 000xx Xxxxxxx,
Xxxxx Xxxxxxx, Xxxxxxx 00000 (hereinafter "Licensor"), P.D.C. Innovative
Industries, Inc., a Nevada corporation, with its principle place of business
located at 0000 XX 000xx Xxxxxx, Xxxxx Xxxxxxx, Xxxxxxx 00000 (hereinafter
"Licensee"), and Medical Marketing Innovations, Inc., a Florida corporation,
having it principle place of business located at 0000 Xxxx 00xx Xxxxxx, Xxxxx
000, Xxxxxxx, Xxxxxxx 00000 (hereinafter "Company") (the signatories to this
Agreement being referred to individually as a "Party" hereto and collectively as
"Parties" hereto).
W I T N E S S E T H:
WHEREAS, Licensor owns certain Technology (as hereinafter defined)
which is covered by Licensor's Patent Rights (also as hereinafter defined); and
WHEREAS, Licensor has previously licensed the Technology and Patent
Rights to Licensee pursuant to an exclusive patents license agreement dated June
8, 2000 by and between Xxxxx Xxxxxx, now deceased, of which Xxxxxx Xxxxxx is the
sole beneficiary and Personal Representative of Licensor's Estate, and the
Licensee (the "June 8 Agreement"), which June 8 Agreement has been subsequently
amended and revised as to the royalty provisions thereof pursuant to the terms
of an October 1, 2001 resolution of the Licensee's Board of Directors, of which
the Licensor was then and is now a director (the "Amendment and Revision") (the
June 8 Agreement and the Amendment and Revision are collectively referred to as
the June 8 Agreement, as amended"); and
WHEREAS, the June 8 Agreement, as amended, is currently in full force
and effect; and
WHEREAS, Licensor and Licensee are both desirous that the Technology
be utilized and further developed, and the Licensor is therefore willing to
permit Licensee to grant an exclusive territorial sub-license and right thereto
pursuant to the terms and conditions hereof (with each of the Licensor and
Licensee understanding that the sub-license and rights thereto as set forth
herein are broader than that previously granted by the Licensor to the Licensee
pursuant to the June 8 Agreement, as amended, to which such expanded license and
rights Licensor agrees by her execution hereof) to the Company for all of the
Technology to which the Licensor and Licensee together have sole right, title
and interest; and
WHEREAS, the Company desires to obtain certain exclusive rights from
the Licensor and Licensee for the commercial development, use, license and /or
sale of the Technology; and
WHEREAS, the Company will receive know-how relating to the Technology
from the Licensee and Licensor, including but not limited to access to the
Licensee and the Licensor;
NOW, THEREFORE, for and in consideration of the covenants, conditions
and undertakings hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which is acknowledged by the
Parties hereto, the Licensor, Licensee and the Company agree as follows:
SECTION 1
DEFINITIONS
-----------
1.1 "Technology" as used herein means all technical and economic
information, know- how and data relating to the Licensor's Hypo-Pro 2000
(formerly referred to as the Hypo-Sterile 2000 in the June 8 Agreement, as
amended) medical device product, all related and /or ancillary products, all
Improvements and Related Technology and Components.
1.2 "Patent Rights" as used herein means rights in the Technology and
all proposed patent applications, pending patent applications (including but not
limited to U.S. Patent Application, Serial No. 10/003874, entitled "Hypodermic
Needle and Syringe Decontamination" and Destroying Apparatus" filed October 24,
2001), issued patents in the United States and any foreign country, any claim of
which covers any portion of the Technology, without limitation, as well as any
continuation, divisional, renewal, reissue, reexamination and extension of any
such applications or patents, and any corresponding foreign patents and
applications.
1.3 "Territories" as used herein means the world, including the United
States and its territorial possessions and Canada.
1.4 "Licensed Product" as used herein means any product, apparatus, kit
or component part thereof, or process or method of operation or other subject
matter whose manufacture, use or sale is covered by any claim or claims included
with the Patent Rights, as such term is defined above.
1.5 "Licensed Method" as used herein means any method, process,
technique or manner of production whose operation or use is covered by any claim
or claims included with the Patent Rights.
1.6 "Improvements" as used herein means each and every modification
relating to the Licensed Product acquired by Licensor with the right to transfer
or license.
1.7 "Affiliate" as used herein means any legal entity or corporation of
which the Company now or may later directly or indirectly control or own.
1.8 "Related Technology and Components" as used herein means all CAD
drawings of circuit board layouts, manufacturing assembly instructions, test
procedures, bills of material, lists of approved vendors, location of unique
dies and tools, engineering test criteria for the Hypo-Pro 2000 product (to the
extent assignable), full documentation for the electronics portion of the
Hypo-Pro 2000, all software operating systems and machine codes for the products
recited above, all copyrights thereto and to the Technology and exclusive use by
the Company of trademarks and copyrights related to the manufacture of the
Licensed Product.
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1.9 "Sold" or "sold" as used herein means sales and/or lease use,
and/or any other use or disposition, however characterized, of the Licensed
Product for which payment has been received by the Company.
1.10 "Improved Patents" as used herein means rights in all issued
patents and pending patent applications in the United States or any foreign
country, which represent any continuation, divisional, renewal, reissue,
reexamination, and extension of any such applications or patents in the Patent
Rights, and any corresponding foreign patents or applications.
1.11 "Net Selling Price" as used herein means the gross selling price
of the Licensed Product sold by the Company or any Affiliate or any sub-licensee
of the Company, less shipping and handling and applicable sales and excise
taxes.
SECTION 2
GRANT
-----
2.1 Subject to the terms and conditions set forth in this Agreement,
Licensee and Licensor hereby grant to the Company an exclusive license and
right, with respect to all intellectual property rights, in the Territories, to
make or have made, use and sell or have sold the Licensed Product in the
Territories. In addition, subject to the terms and conditions set forth in this
Agreement, Licensee and Licensor hereby grant to the Company an exclusive
license and right, in the Territories, with the sole and exclusive right, in
prior consultation with the Licensee and Licensor, but in Licensee's sole
discretion, to sublicense to one other person or entity during the Term (as
defined in Section 9 hereof), or from time to time during the Term if any such
sublicense is for less than the Term, on such terms and conditions as the
Company may, in its sole discretion, agree, subject to Section 3 hereof, under
Licensor's Patent Rights and Technology to make or have made, use and sell or
have sold the Licensed Product in the Territories.
2.2 Except as otherwise provided for herein, the license and right
granted in Paragraph 2.1 above shall be exclusive from the date first set forth
above until the last of Licensor's Patent Rights expire or unless otherwise
terminated by operation of law or by acts of the Parties in accordance with the
terms of this Agreement, whichever is earlier.
SECTION 3
SUBLICENSES
-----------
3.1 Subject to the terms of Section 2 hereof, Licensee and Licensor
also grant to the Company the right to issue further sublicenses to third
parties to make, to have made, to use and to sell the Licensed Product and the
Technology in the Territories, provided that the Company has current exclusive
rights thereto under this Agreement in the Territories and during the period
being sublicensed. Further sublicenses shall include all of the rights and
obligations due to the Licensee and Licensor that are contained in this
Agreement to the extent applicable.
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3.2 Should this Agreement be terminated by its terms, such termination
shall automatically operate as an assignment by the Company to Licensee of all
of the Company 's right, title and interest in and to each sublicense granted by
the Company hereunder prior to the effective date of such termination, unless
upon notification of such termination the sublicensee shall elect to terminate
the sublicense. Nothing contained herein, including termination, shall impair
the rights of any sublicensee who is not in default of the terms and conditions
of this Agreement, where applicable, to maintain such sublicense upon the same
terms and conditions as established between the Company and further sublicense,
at the option of such sublicensee.
SECTION 4
INITIAL PAYMENTS AND MINIMUM SUB-LICENSE FEES BY THE COMPANY TO
---------------------------------------------------------------
LICENSEE
--------
4.1 The Company shall pay minimum annual royalty payments in the
following amounts to the Licensee, commencing in the calendar year that the
Licensed Product may receive approval by the U.S. Food and Drug Administration
("FDA") and each subsequent calendar year thereafter during the Term , payable
in full on or before December 31 of each such calendar year:
- $50,000 in year 1 (provided FDA approval is received by the
Licensee on or prior to June 30th of the subject calendar
year; if FDA approval is received by the Licensee after June
30th of the subject calendar year, such initial $50,000
payment shall be made in the immediately following calendar
year which shall then constitute year 1);
- $150,000 in year 2;
- $500,000 in year 3 and each subsequent year thereafter
during the term of this Agreement.
In the event this Agreement is terminated in accordance with its terms
prior to the completion of any such calendar year, the pro-rata portion of such
minimum annual royalty payment for such calender year shall be paid within
thirty (30) days of such termination date.
SECTION 5
EARNED RUNNING ROYALTIES
------------------------
5.1 In addition to the minimum annual royalty payment required to be
paid by the Company to the Licensee in accordance with the requirements of
paragraph 4.1 above, the Company shall pay to the Licensee an earned running
royalty of twenty percent (20%) of the Net Selling Price for the Licensed
Product sold by the Company and any sub-licensees (not affiliated or otherwise
related directly or indirectly to the Company and/or any of its affiliates) of
the Company, commencing with the first sale. Such earned running royalty
percentage shall also apply to any and all sub-license and/or other fees,
however characterized, which may be charged and received by the Company.
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5.2 Earned running royalties under paragraph 5.1 above shall accrue for
the duration of the Patent Rights.
5.3 Earned running royalties accruing to the Licensee shall be paid to
the Licensee on a quarterly basis within thirty (30) days of the end of each
calendar quarter in which the Licensed Product is sold.
5.4 In the event that one or more patent claims included with the
Patent Rights shall be held invalid or not patentable in a decision by a court
of competent jurisdiction and last resort in any country and from which no
appeal has or can be taken, all obligations to pay running royalties for sales
in that country as set forth in paragraph 5.1 hereof on said patent claim or any
claim patentably indistinct therefrom shall cease as of the date of such
decision, except and to the extent that the Company continues to market and sell
the Licensed Product in any such country/countries and receives payment thereon.
The Company shall not, however, be relieved, from paying any earned running
royalties that have accrued before such adverse judicial decision or that are
based on another patent or claim not involved in such decision.
5.5 All monies due the Licensee shall be payable in United States funds
to the Licensee at the address set forth in paragraph 22.1. When the Company is
paid for Licensed Products in monies other than United States dollars, the
earned running royalties due the Licensee will first be determined in the
foreign currency of the country in which such Licensed Product was sold and then
converted into equivalent United States funds at the rate established for that
foreign currency. This conversion rate shall be the rate published in the Wall
Street Journal on the last business day of each quarterly accounting period
specified in paragraph 5.3 above.
SECTION 6
DUE DILIGENCE AND MARKETING
---------------------------
6.1 The Company, upon execution of this Agreement and within a
reasonable period following such time as when the Licensed Product may receive
FDA approval, shall diligently proceed at its sole cost and expense with the
development, manufacture, marketing and sale of Licensed Products and shall
earnestly and diligently endeavor at its sole cost and expense to market the
same within a reasonable time after the effective date of this Agreement and
following such time as when the Licensed Product may receive FDA approval.
6.2 The Company shall be entitled to exercise prudent and justifiable
business judgement in meeting its due diligence obligations hereunder.
6.3 The Company agrees to xxxx the Licensed Product with the applicable
patent number or numbers as required by law.
SECTION 7
REPORTS, BOOKS AND RECORDS
--------------------------
7.1 At the end of the first quarterly accounting period after the first
royalty-bearing sale of the Licensed Product or practice of the License Method
by the Company, the Company
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shall provide both the Licensee and the Licensor with a written report showing
all sales or use (which includes leased use) made of the Licensed Product during
the preceding quarterly accounting period. Reports are due within thirty (30)
days of the end of each calendar quarter, for the preceding quarterly accounting
period. If no sale, or use of the Licensed Product or Licensed Method has been
made during any reporting period, a written statement to this effect shall be
required within such time period. All such reports shall be treated by the
Licensee and the Licensor as proprietary business information of Company. The
Company shall cause all sublicensees to submit similar reports to Licensor and
Licensee.
7.2 The Company shall prepare financial statements on a monthly,
quarterly and annual basis in accordance with U.S. generally accepted accounting
principles ("GAAP") consistently applied except as may be indicated therein or
in the notes thereto and in conformity with the Company's books and records, and
fairly present the financial position of the Company as of their respective
dates and the results of operations for the periods then ended. The Company
shall provide true and correct copies of each of such financial statements to
each of the Licensee and the Licensee promptly following their preparation and
completion. The Company's books and records shall truthfully and accurately show
all sales of Licensed Products by the Company under the terms of this Agreement.
Such books and records shall be open to inspection on a confidential basis by
representatives and/or agents of the Licensee and/or the Licensor at reasonable
times, but in no event more than four (4) times for each calendar year as to
each such Party, for the purpose of verifying the accuracy of the reports and
the royalties due.
7.3 The fees and expenses of the representatives and/or agents
performing such an examination shall be borne by the Company.
7.4 The books and records required by paragraph 7.2 hereof shall be
preserved for at least seven (7) years from the date of the royalty payment to
which they pertain.
SECTION 8
CONFIDENTIAL INFORMATION
------------------------
8.1 The Company acknowledges that the Technology, all technical data,
economic information, know-how and data developed by or through the Licensee and
Licensor is confidential, proprietary information.
8.2 The obligation to maintain the confidentiality of the Licensee's
and Licensor's confidential information shall extend five (5) years beyond the
life of this Agreement as set forth in paragraph 9.2 herein.
8.3 A Party receiving confidential information from a disclosing Party
shall not be prevented from using or disclosing information:
(a) which is now, or becomes in the future public
knowledge other than by breach of this Agreement by
the receiving Party;
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(b) which is lawfully obtained by the receiving Party
from a source independent of the disclosing Party;
(c) which is subsequently developed by the receiving
Party independent of the confidential information
received hereunder; or,
(d) which is subsequently disclosed by the disclosing
Party, including information developed after the date
of this Agreement, to a third party on a
non-confidential basis.
SECTION 9
LIFE OF THE AGREEMENT
---------------------
9.1 This Agreement will not be binding upon the Parties until it has
been signed hereinbelow by or on behalf of each Party, in which event, it shall
be effective as of the later of the date of execution by all of the Parties.
9.2 This Agreement shall be in full force and effect from the effective
date of this Agreement and shall remain in effect for the last to expire patent
under this Agreement or unless otherwise terminated by operation of law or by
acts of the Parties in accordance with the terms of this Agreement (the "Term").
SECTION 10
DEFAULT BY COMPANY
------------------
10.1 It is expressly agreed that, notwithstanding the provisions of
Section 21 hereof concerning late payments, if the Company should fail to
deliver to the Licensee any statement or report when due, or fail to pay any
royalty at the time that the same should be due or if the Company should violate
or fail to perform any material representation, warranty, covenant, term,
provision, condition or undertaking of this Agreement on its part to be
performed hereunder, including but not limited to the timely payment of the
minimum annual royalty payment to be paid by the Company to the Licensee
pursuant to paragraph 4.2 herein and the earned running royalties to be paid by
the Company to the Licensee pursuant to Section 5 hereof, or fail to maintain an
on-going, regular place of business for a continuous sixty (60) day period, then
and in such event the Licensee may give written notice of such default to the
Company. If the Company should fail to make substantial progress toward curing
such default within thirty (30) days from the date of delivery of such notice to
the Company as defined in Section 22 ("Notices") hereof, the Licensee shall have
the right to terminate this Agreement or initiate litigation to enforce any of
the terms of this Agreement by written notice to the Company. Such termination
of this Agreement by the Licensee or initiation of litigation shall not relieve
the Company of its obligation to pay any royalty or fees due or owing at the
time of such termination or litigation and shall not impair any accrued right of
the Licensee and/or the Licensor.
10.2 Notwithstanding the terms and provisions of paragraph 10.1 above,
in the event following the date hereof that:
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(i) Xxxxxx Xxxxxxx ("Xxxxxxx") and Xxxx Xxxxxxx ("Xxxxxxx")
are no longer officers and directors of the Company for any reason or no reason;
or
(ii) there is any change in the collective corporate
responsibilities and/or duties to the Company of Xxxxxxx and Xxxxxxx (and
without regard to whether or not there is a change in any of their respective
corporate titles and/or positions); or
(iii) Xxxxxxx and Xxxxxxx die or become disabled and/or
incapacitated (in the case of disability and/or incapacity, defined for purposes
hereof to mean the inability for whatever reason(s), for a period of 45
consecutive days, of the person to discharge all of the duties and
responsibilities performed by such person for and on behalf of the Company prior
to the onset of such disability and/or incapacity; or
(iv) the Company fails to adhere to the range and use of
proceeds agreed to by the Company and the Licensee of any funds which may be
made available to the Company by one or more funding sources introduced directly
or indirectly by the Licensee to the Company,
then in any of such events, the Licensee shall have the right to immediately
terminate this Agreement and pursue such remedies at law and/or in equity as it
may in its sole discretion determine.
10.3 If Xxxxxxx Xxxxx ("Xxxxx") is no longer an officer and/or director
of the Company for any reason or no reason, or if he becomes disabled or
incapacitated, as such terms are defined in paragraph 10.2 (iii) above, the
Company will promptly seek and obtain another person to fill Xxxxx'x officer and
director position, which person shall be reasonably acceptable to the Licensee.
SECTION 11
TERMINATION BY THE COMPANY
--------------------------
11.1 The Company shall have the right to terminate this Agreement and
the rights granted herein, at any time, and from time to time, by giving notice
in writing to the Licensee and the Licensor. Such termination shall be effective
ninety (90) days from the date of delivery of such notice as defined in Section
22 ("Notices") hereof, and the Company's rights associated therewith shall cease
as of that date.
11.2 Upon termination pursuant to paragraph 11.1, the Company agrees to
assign all Patent Rights to the Licensee within thirty (30) days from the date
of the delivery of the notice described in paragraph 11.1. The failure of the
Company to assign the Patent Rights to the Licensee will be a material breach of
this Agreement and the Licensee may initiate litigation to enforce such
assignment.
11.3 Any termination pursuant to the above paragraph shall not relieve
the Company of any obligation or liability accrued hereunder prior to such
termination, or rescind or give rise to any right to rescind anything done by
the Company or any payments made (including the payment of the initial license
fee) or other consideration given to the Licensee and/or the Licensor hereunder
prior to the time such termination becomes effective, and such termination
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shall not affect in any manner any rights of the Licensee and/or the Licensor
arising under this Agreement prior to such termination.
SECTION 12
DISPOSITION OF LICENSED PRODUCTS ON HAND UPON TERMINATION
---------------------------------------------------------
12.1 Upon termination of this Agreement by any of the Parties, the
Company shall provide both the Licensee and the Licensor with a written report
listing all orders for the Licensed Product by the Company and a report listing
all Licensed Products under the control of the Company and/or its Affiliates.
The Company shall pay royalties thereon at the rate herein provided, which
royalties will become due within thirty (30) days of the time payment for said
orders is received by the Company, and the Company shall render reports thereon
in the manner herein provided. If a sublicensee is terminated, the Company shall
cause the sublicensee to provide the same report to each of Licensee and
Licensor as specified in this paragraph 12.1.
SECTION 13
PATENT PROSECUTION AND MAINTENANCE; NOXIOUS AND RELATED TESTING;
----------------------------------------------------------------
FDA APPROVAL
------------
13.1 The Licensor shall continue at the Licensor's sole cost and
expense to prosecute and maintain the United States patents and patent
applications set forth in the Patent Rights utilizing counsel of the Licensor's
choice, until such time as a United States patent on the Licensed Product in its
current state and without any further Improvements (except as the Licensor,
Licensee and the Company may otherwise agree in writing) may be issued.
Subsequent thereto, the Company shall use commercially reasonable efforts at its
sole cost and expense to prosecute and maintain the United States patents and
patent applications set forth in the Patent Rights utilizing counsel of the
Company's choice in consultation with the Licensee and the Licensor. The
Licensee and the Licensor shall provide the Company with copies of all relevant
documentation so that the Company may prepare and prosecute such Patent Rights.
The Company shall keep the Licensee and Licensor reasonably informed and
apprized of the continuing prosecution of these Patent Rights.
13.2 The Company shall use its best efforts to amend any patent
application to include claims reasonably requested by Licensee and required to
protect the Licensed Product and methods covered by the Licensed Product
pursuant to this Agreement.
13.3 The preparation, filing and prosecuting of all foreign patent
applications filed at Licensee's request, as well as the maintenance of all
resulting patents, shall be at the Company's sole expense. Such patents shall be
held in the name of the Licensor and shall be obtained using counsel mutually
acceptable to all of the Parties hereto. The Company shall timely pay all of the
expenses and costs of such counsel in accordance with such counsel('s') standard
billing practices.
13.4 Following such time as when the Licensed Product in its current
state and without any further Improvements (except as the Licensee and the
Company may otherwise agree in writing) may receive FDA approval and complete
required noxious and related testing in order to
9
receive such FDA approval, which FDA approval and testing shall be at the
Licensee's sole cost and expense, the Company shall use commercially reasonable
efforts at its sole cost and expense to conduct additional noxious and related
testing of the License Product and any Improvements thereto and to then seek and
obtain FDA approval of the License Product and any Improvements thereto.
SECTION 14
USE OF NAMES, TRADE NAMES, AND TRADEMARKS
-----------------------------------------
14.1 Nothing contained in this Agreement shall be construed as
conferring any right to the Licensee and/or the Licensor to use in advertising,
publicity, or other promotional activities any name, trade name, trademark, or
other designation of the Company (including any contraction, abbreviation, or
simulation of any of the foregoing).
SECTION 15
REPRESENTATIONS AND WARRANTIES BY THE LICENSEE, LICENSOR, COMPANY
-----------------------------------------------------------------
AND THE PARTIES
---------------
15.1.0 The Licensee represents and warrants, subject to the execution
of this Agreement by the Licensor, that it has the lawful right to enter into
this Agreement.
15.1.1 The Licensor represents and warrants that the Licensor has full
legal right and authority to enter into this Agreement.
15.1.2 The Company represents and warrants that it has the lawful right
to enter into and perform all of its obligations under this Agreement, and that
no consent of any third party is required for the Company to enter into this
Agreement and/or to perform all of its obligations hereunder.
15.2 None of the Parties provide a warranty of merchantability or
fitness for a particular purpose or any other warranty, express or implied.
Neither the Licensee nor the Licensor makes any representation or warranty that
the Licensed Product will not infringe any patent or other proprietary right.
Each of the Licensee and the Licensor represents and warrants, as of the date of
this Agreement, that it has no knowledge of any infringement of any patent or
other proprietary right of a third party with respect to the manufacture and/or
sale of the Licensed Products and the practice of the Licensed Method.
15.3 IN NO EVENT WILL THE LICENSEE OR THE LICENSOR BE LIABLE FOR ANY
INCIDENTAL, SPECIAL, OR CONSEQUENTIAL DAMAGES RESULTING FROM THIS SUB-LICENSE OR
THE USE OF THE LICENSED PRODUCT OR LICENSED METHOD.
15.4 Nothing in this Agreement shall be construed as:
(15.4a) a warranty or representation by the Licensee and/or
the Licensor as to the validity or scope of the
Patent Rights; or
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(15.4b) a warranty or representation that anything made,
used, sold, or otherwise disposed of under any
license granted in this Agreement is or will be free
from infringement of patents of third parties; or
(15.4c) an obligation to bring or prosecute actions or suits
against third parties for patent infringement; except
as provided in Section 16; or
(15.4d) conferring by implication, estoppel, o otherwise any
other license or rights other than those specified in
the Patent Rights as defined herein.
15.5 Licensor represents and warrants that the Licensor has not granted
any assignment and/or other license relating to the Patent Rights in the U.S. or
any foreign country other than the license to Licensee in derogation of the
rights granted herein to the Company.
SECTION 16
INFRINGEMENT
--------------
16.1 In the event that any Party to this Agreement shall learn of the
substantial infringement of any of the Patent Rights, that Party shall notify
the other Parties in writing and shall provide the other Parties with reasonable
evidence of such infringement.
16.2 The Parties shall use their best efforts in cooperating with each
other to terminate such infringement without litigation. Upon its determination
that infringement exists, the Company shall formally notify the infringing party
of the Company's determination that infringement exists. The Licensee and the
Licensor shall each be obligated at the Company's sole cost and expense to
cooperate with the Company regarding any infringement action and/or proceeding,
which the Company shall promptly and diligently pursue at the Company's sole
expense if the efforts of the Parties to terminate such infringement without
litigation are not successful.
SECTION 17
WAIVER
--------
17.1 It is agreed that no waiver by any Party hereto of any breach or
default of any of the representations, warranties, covenants or agreements
herein set forth shall be deemed a waiver as to any subsequent and/or similar
breach or default.
SECTION 18
LICENSE RESTRICTIONS
----------------------
18.1 It is agreed that the rights and privileges granted to the Company
are each and all expressly conditioned upon the faithful performance on the part
of the Company of every
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requirement, term, condition and provision herein contained. Each of such
requirements, terms, conditions and provisions is a specific license
restriction.
SECTION 19
ASSIGNABILITY
-------------
19.1 This Agreement is binding upon and shall inure to the benefit of
the Parties, their respective successors and assigns and is assignable by each
of the Licensee and the Licensor, but not the Company without the prior written
consent of each of the Licensee and the Licensor, which may be withheld in the
sole discretion of each.
19.2 The Company agrees to notify the Licensee and the Licensor of any
change in controlling interest (defined to mean the sale, transfer, lien,
hypothecation or encumbrance of twenty five percent (25%) or more of the
Company's outstanding securities as of the date first set forth above, including
any securities exercisable or convertible into shares of the Company's common
stock equal to or greater than such percentage) prior to any such occurrence.
The Licensee and Licensor may in such event in their sole discretion and without
any liability to either of such two Parties terminate this Agreement. The
Company agrees to notify the Licensee and the Licensor of sublicense agreements
regarding the Patent Rights entered into by the Company within thirty (30) days
of its occurrence.
SECTION 20
PRODUCT LIABILITY; INDEMNITY
----------------------------
20.1 The Company, at its sole cost and expense, shall insure its
activities in connection with this Agreement and obtain, keep in force and
maintain general commercial liability insurance, including but not limited to
product liability insurance, in such amounts as is deemed commercially
reasonable based upon the scope of the Company's then current and projected
sales and marketing activities, with the Licensee and the Licensor to each be
named as additional insured payees therein. The Company shall promptly provide a
copy of such insurance policy to the Licensee and/or Licensor upon request from
such Party.
20.2 The Company agrees to indemnify, hold harmless, and defend each of
the Licensee, its officers, directors, employees, shareholders, agents,
representatives, successors and assigns (and its/their officers, directors,
employees, shareholders, agents and representatives) and the Licensor and her
agents, representatives, heirs, successors, and assigns (and his/her its agents,
representatives and heirs) from and against any and all claims, suits, losses,
damage, costs, fees, and expenses, including reasonable attorneys' fees and
costs arising from the commercialization and utilization of the Licensed
Product, including but not limited to, the making, using, and selling, or
exporting of products, processes, or services derived therefrom. This
indemnification will include, but will not be limited to, any product liability.
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SECTION 21
LATE PAYMENTS
-------------
21.1 In the event royalty payments or fees are not received by the
Licensee within thirty (30) days of when due, the Company shall pay to the
Licensee interest charges at the rate of one percent (1%) per month on the
amount of such royalties or fees overdue, unless otherwise agreed to in writing
by the Licensee.
SECTION 22
NOTICES
-------
22.1 Any payment, notice, or other communication required or permitted
to be given to any Party hereto shall be deemed to have been properly given and
to be effective on the date of delivery if delivered in person or by courier or
by first-class certified mail, postage paid, or via telecopier (with a printed
transmission confirmation of receipt provided to the sender thereof) to the
respective address given below, or to such other address as it shall designate
by written notice given to the other party as follows:
In the case of the Company:
Medical Marketing Innovations, Inc.
0000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: President
Telecopier No. (305-558-5977)
In the case of the Licensee:
P.D.C. Innovative Industries, Inc.
0000 XX 000xx Xxxxxx
Xxxxx Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx Xxxxx, Chief Executive Officer
Telecopier No. (000) 000-0000
In the case of the Licensor:
Xxxxxx Xxxxxx, Personal Representative for the Estate of Xxxxx Xxxxxx
0000 XX 000xx Xxxxxxx
Xxxxx Xxxxxxx, Xxxxxxx 000000
Telecopier No. (000) 000-0000
SECTION 23
FORCE MAJEURE
-------------
23.1 No Party shall be responsible for delay or failure in performance
of any of the obligations imposed by this Agreement, provided such failure shall
be occasioned by fire, flood, explosion, lighting, windstorm, earthquake,
subsidence of soil, court order or government
13
interference, civil commotion, riot, war, or by any cause of like or unlike
nature beyond the control and without fault or negligence of such Party.
SECTION 24
GOVERNING LAW
-------------
24.1 This Agreement shall be interpreted and construed in accordance
with the laws of the State of Florida without regard to choice or conflict of
law principles.
SECTION 25
BANKRUPTCY OF COMPANY
---------------------
25.1 If the Company shall become bankrupt or insolvent, or shall file a
petition in bankruptcy, or if the business of Company shall be placed in the
hands of a receiver, assignee or trustee for the benefit of creditors, whether
by the voluntary act of Company or otherwise, this Agreement shall automatically
terminate according to the conditions set forth in Section 11, except that the
thirty (30) day notice provision therein shall not apply.
SECTION 26
MISCELLANEOUS
-------------
26.1 The headings of the several sections are inserted for convenience
of reference only and are not intended to be a part of or to affect the meaning
or interpretation of this Agreement.
26.2 No amendment or modification hereof shall be valid or binding upon
the Parties unless made in writing and signed by each of the Company, the
License and the Licensor.
26.3 This Agreement embodies the entire understanding of the Parties
and shall supersede all previous communications, representations, or
understandings, either oral or written, between the Parties relating to the
subject matter hereof.
26.4 In the event any one or more of the provisions contained in this
Agreement shall for any reason be held to be invalid, illegal, or unenforceable
in any respect, such invalidity, illegality, or unenforceability shall not
affect any other provisions hereof, but this Agreement shall be construed as if
such invalid or illegal or unenforceable provisions had never been contained
herein.
26.5 For the consideration set forth herein, and other good and
valuable consideration, the receipt and sufficiency of which is acknowledged by
each of the Licensee and the Licensor, the Licensee and the Licensor agree that
this Agreement supercedes the June 8 Agreement, as amended, to the extent of any
inconsistences, including but not limited to the royalty payment provisions set
forth therein, which shall no longer be applicable or in force or effect.
Licensor also further agrees that the anti-dilution provisions contained in
Section 3 (b) of the June 8 Agreement are no longer applicable and that Licensor
is not and shall not be entitled to any shares of the Licensee's common stock
pursuant thereto, and waives any and all claims, if any arising from or
pertaining to such provision.
14
26.6 As all of the Parties to this Agreement have each been represented
by counsel in connection herewith, the rule of construction that ambiguities
shall be construed against the drafter shall not be applicable.
26.7 The Parties hereto agree that in the event following the date
hereof, that the Licensee is made an offer by a third party not introduced to
the Licensee by the Company to acquire the Licensee's rights in and to the
Licensed Product, and the Licensee determines to accept such offer, the Parties
agree that the Licensee may accept such offer in its sole discretion and without
any consent or consultation required of or from either of the other two Parties
hereto. If such offer is accepted, this Agreement shall terminate immediately
prior to the consummation of such transaction and the Parties hereto agree that
the Licensee and the Company shall each be entitled to receive 2/3 and 1/3,
respectively, of any and all consideration to be paid by such third party in
connection therewith, such formula having been determined by the Parties on the
basis of the Parties' respective responsibilities and obligations hereunder. If
an offer is made by a third party introduced to the Licensee by the Company with
whom the Licensee did not have any prior relationship or dealings, and such
offer is accepted by the Licensee, the same terms and conditions as set forth
above shall apply, except that the Licensee and the Company shall each be
entitled to receive 1/2, respectively, of any and all consideration to be paid
by such third party in connection therewith. In the event of any good faith
question or dispute concerning whether or not the Licensee had any prior
relationship or dealings with a third party introduced to the Licensee by the
Company, the Parties hereto agree that the Licensee's position concerning this
matter shall control and be dispositive.
26.8 This Agreement may be executed in counterparts and via telecopier.
SECTION 27
LITIGATION
----------
27.1 Any controversy, claim, action and/or proceeding relating to or
arising out of this Agreement, its interpretation, performance, or termination,
or the breach thereof, shall be brought solely in the federal and/or state
courts located in Broward County, Florida. The prevailing party in any such
action and/or proceeding shall be entitled to recover its reasonable attorney's
fees and costs from the other party/parties.
IN WITNESS WHEREOF, each of the Company, the Licensee, and the Licensor
have executed this Agreement, in triplicate originals (in the case or each of
the Company and the Licensee, by their respective officers hereunto duly
authorized), on the day and year hereinafter written, to be effective the 21st
day of November 2002.
MEDICAL MARKETING INNOVATIONS, INC.
By: /s/ Xxxx Xxxxxxx
----------------------------
Xxxx Xxxxxxx, President
15
STATE OF FLORIDA )
)SS:
COUNTY OF BROWARD )
The foregoing instrument was acknowledged before me this 21st day of November
2002 by__________ as President of Medical Marketing Innovations, Inc. a Florida
corporation, on behalf of such corporation, who is personally known to me or has
produced _____________ as identification and did/did not take an oath.
Notary Public:
sign /s/ Xxxxxx Xxxxxx
--------------------------
print Xxxxxx Xxxxxxx
------------------------
State of Florida at Large (Seal)
My Commission Expires: April 1, 2006
P.D.C. INNOVATIVE INDUSTRIES, INC.
By: /s/ Xxxxxxx Xxxxx
---------------------------
Xxxxxxx Xxxxx, Chief Executive Officer
STATE OF FLORIDA )
)SS:
COUNTY OF BROWARD )
The foregoing instrument was acknowledged before me this 21st day of November
2002 by Xxxxxxx Xxxxx as Chief Executive Officer of P.D.C. Innovative
Industries, Inc., a Nevada corporation, on behalf of such corporation, who is
personally known to me or has produced ______________ as identification and
did/did not take an oath.
Notary Public:
sign /s/ Xxxxxxx X. Xxxxx
-------------------------
print Xxxxxxx X. Xxxxx
-------------------------
State of Florida at Large (Seal)
My Commission Expires: 7/28/06
/s/ Xxxxxx Xxxxxx
--------------------------------
Xxxxxx Xxxxxx, Personal Representative
for the Estate of Xxxxx Xxxxxx
16
STATE OF FLORIDA )
)SS:
COUNTY OF BROWARD )
The foregoing instrument was acknowledged before me this 21st day of
November 2002 by Xxxxxx Xxxxxx as Personal Representative for the Estate of
Xxxxx Xxxxxx, who is personally known to me or has produced ______________ as
identification and did/did not take an oath.
Notary Public:
sign /s/ Xxxxxxx Xxxxx
--------------------------
print Xxxxxxx Xxxxx
--------------------------
State of Florida at Large (Seal)
My Commission Expires: 7/28/06
17
