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EXHIBIT 10.3.1
ADDENDUM AGREEMENT
ASSIGNMENT OF TECHNOLOGY
This Agreement is an Addendum to an Agreement dated March 2, 1992, for
Assignment of Technology by and between Xxxxxx X. Xxxxxx, a resident of the
State of California (herein referred to as XXXXXX), and American Technology
Corporation, a Utah corporation at the time of signature in 1992 and now a
Delaware corporation (referred to herein as COMPANY).
WHEREAS, XXXXXX and COMPANY entered into an Assignment of Technology on
March 2, 1992 (attached hereto as Exhibit 1) providing for an Assignment of
certain technologies from XXXXXX to the COMPANY;
WHEREAS, the parties hereto desire to continue this Agreement under
terms of an extension;
NOW, THEREFORE, the parties agree as follows:
1. EXTENSION
Pursuant to paragraph 11 of the referenced Agreement for ASSIGNMENT OF
TECHNOLOGY, the parties hereto desire to extend the referenced Agreement for an
additional period of five (5) years to March 2, 2002. All provisions of the
previous Agreement are to be carried forward, except where they have been
expressly modified by the following terms.
2. TECHNICAL DEVELOPMENTS
Based on the occurrence of development of improvements by XXXXXX during
the present term of agreement, further improvements and inventions are probable
during the term of extension. Specifically, Technology Section 3 of Exhibit A
(referred as the TRACKER) has been modified and enhanced with GPS (Global
Positioning System) technology and includes two pending patent applications.
Section 4 of Exhibit A (identified as the SONIC GENERATOR) has been the subject
of further invention and development and has been modified and enhanced
(Acoustical Heterodyne or HyperSonic Sound), including three patent
applications. It is mutually acknowledged that the original characterization of
these respective areas shall be carried forward into newly developed
technologies, and shall be referred to hereafter as technologies relating to the
TRACKER and SONIC GENERATOR.
3. ROYALTIES
In consideration of new technologies developed by XXXXXX and
improvements anticipated over the next five years in both TRACKER and SONIC
GENERATOR, ATC agrees to pay a royalty of two percent (2%) of gross revenues
received by COMPANY from the sale or license or other exploitation of TRACKER
technology and SONIC GENERATOR technology, less proceeds allocated for tax,
shipping, and credit for returns. This royalty shall be payable for a period of
ten (10) years commencing on March 1, 1997 or during any period of time which
revenues are received from product or licensing which is subject to an existing
patent assigned to the COMPANY by XXXXXX under this Agreement, whichever period
is longer.
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4. REPORTS AND TIME OF ROYALTY PAYMENTS
For the purpose of computing the royalties referred to in Paragraph 3
of this Agreement, the year shall be divided into quarters, beginning January 1,
April 1, July 1, and October 1 of each year. Within thirty (30) days after the
end of each quarter, COMPANY shall submit a written report to XXXXXX setting
forth the referenced gross revenue received during the preceding quarter.
COMPANY's remittance for the full amount of royalties due for such quarter shall
accompany such reports. COMPANY agrees to keep complete and correct account of
sales and licensing fees embodying the above-mentioned inventions, and XXXXXX or
its representative shall have the right to examine books of account at all
reasonable times to the extent and insofar as is necessary to verify the
accuracy of the above-mentioned reports.
5. TRANSFER OF TECHNOLOGY
In accordance with the terms of the referenced Agreement, XXXXXX hereby
acknowledges his ongoing responsibility of disclosing and transferring to the
COMPANY all information and property interests as required under the parent
agreement during this period of extension.
EXECUTED AS OF THIS 2nd day of December, 1996.
AMERICAN TECHNOLOGY CORPORATION
By: /S/XXXXXX XXXXXX
Xxxxxx Xxxxxx
President and CEO
By: /S/XXXXXX X. XXXXXX
Xxxxxx X. Xxxxxx
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