EXHIBIT 10.1
TECHNOLOGY LICENSE AGREEMENT
THIS IS AN AGREEMENT by and between W.B.G., INC., 00000-00 Xxxxxxx Xxxxxx,
Xxxxxxxx, Xxxxxxxxxx 00000, a California corporation ("WBG"), and TRANSMISSION
TECHNOLOGY CORPORATION, 000 Xxxx Xxxxxx, Xxxxxx, Xxxxx 00000, a Nevada
corporation ("TTC").
WHEREAS, the business of WBG includes the inventing, testing, and patenting of
composite based electrical transmission cables and related technologies
sometimes referred to as the TeleConductors; and
WHEREAS, the business of TTC, its assigns or affiliates includes developing,
manufacturing, marketing and sub-licensing products for electrical energy
transmission and distribution; and
WHEREAS, it is the desire of the parties hereto to enter into a business
relationship concerning the WBG TeleConductor technologies;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, WBG and TTC agree as follows:
1. DEFINITIONS
1.1 "Technology" means all inventions, patents, formulations and compositions,
manufacturing and processing techniques, designs, productions, applications and
use specifications, technical, business and marketing information, improvements,
modifications, developments, know-how, trade secrets, proprietary information,
confidential information, technical information, and all other information
related to or relating in any manner whatsoever to the TeleConductors. The
TeleConductors are described in Exhibit "A" attached hereto and is referred to
herein as if copied in verbatim.
1.2 "WBG Technology" means all Technology owned, possessed or controlled by WBG
that relates to or is otherwise applicable to the TeleConductors, including
without limitation compositions, properties or characteristics, manufacturing
and processing techniques and end use applications relating to Technology of the
TeleConductors.
1.3 "WBG Patent Rights" means patents and patent applications (including but not
limited to all certificates of invention, applications for certificates of
invention and utility models covering or relating to Technology, including any
substitutions, extensions, reissues, reexaminations, renewals, divisions,
continuations, or continuations-in-part, and related foreign filings) owned
and/or controlled by WBG relating to Technology.
1.4 "Gross Revenues" means all amounts received by TTC relating to the sale of
the TeleConductors, less associated taxes, duties, and/or tariffs, less
associated discounts, allowances, credits on returns and reimbursements, and
less associated freight, insurance, and other delivery expenses.
1.5 "Effective Date" means the date that this document is signed by the parties
hereto.
2. TERMS
2.1 TECHNOLOGY/PATENT RIGHTS. WBG grants TTC exclusive rights to the Technology
and future products in development including but not limited to marine cable
technologies, direct burial cable technologies, distribution cable technologies,
improvements in the Technology and other special designs. TTC shall have the
right to sub-license the Technology so long as WBG receives the same
consideration as it would from TTC's use of the Technology.
2.2 CONSIDERATION. For and in consideration of receiving exclusive rights to the
Technology described in Section 2.1 above, TTC shall pay WBG as follows:
o ROYALTY. TTC shall pay WBG a maximum royalty of FIVE percent (5%) of Gross
Revenues received by TTC from the sale of the Technology products until
sales of product have equaled the design capacity of the first commercial
production line. Design capacity of each commercial production line shall
be defined as the capacity stated on the specifications by the builder
which is WBG. The royalty shall decline by ONE percent (1%) of Gross
Revenues as sales of product from each additional commercial production
line reaches design capacity. TTC shall pay WBG a minimum royalty of TWO
percent (2%) of Gross Revenues received by TTC from the sale of the
Technology products.
o SUB-LICENSE ROYALTY. TTC shall pay the same royalty to WBG as it would if
it sold the products itself.
o COMMERCIAL PRODUCT LINE DEVELOPMENT. TTC agrees to pay WBG to design,
build, test, install, provide specifications, manuals, and training for
complete commercial product equipment lines for each Technology. The price
to be mutually agreed upon based upon costs plus reasonable overhead fees.
TTC understands and agrees that it must advance funds to WBG for each
phase as required under a mutually agreed upon budget and schedule.
o ADDITIONAL COMMERCIAL PRODUCT LINES SUPPLY. TTC agrees to purchase
additional commercial product lines from WBG for all additional plant
lines as required at mutually agreed upon prices and delivery schedules.
If WBG is unable to supply said additional commercial product lines, then
TTC shall have the right to produce same.
2.3 ROYALTY PAYMENT SCHEDULE. All amounts due WBG under Paragraph 2.2 shall be
paid by TTC on a monthly basis within thirty (30) days of the end of each such
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month, to be adjusted on a quarterly basis from reports prepared for quarterly
accounting. TTC shall include with each payment a report of the applicable Gross
Revenues so the amount payable to WBG hereunder can be accurately determined.
2.4 RECORDS/AUDIT. TTC shall keep and maintain adequate records in accordance
with accepted practices for purposes of determining all amounts due WBG
hereunder. WBG and/or a designated representative shall have a right to require
an audit of all records of TTC for purposes of determining the accuracy of
payments made or payable to WBG hereunder. In the event that any audit reveals a
deficiency in the amount due WBG, the amount of the deficiency, interest
accruing at the rate of ten percent (10%) per annum from the date on which
payment was actually due and all reasonable costs associated with such audit
shall be paid by TTC to WBG within thirty (30) days of TTC receiving
notification of the deficiency and TTC's confirmation of the deficiency.
2.5 RIGHT TO DEVELOP. WBG agrees to develop improvements in the Technology using
grants or other sources including payments by TTC and WBG agrees that all such
improvements shall be a part of the grant of rights to TTC referred to in
Paragraph 2.1.
2.6 FULL DISCLOSURE. WBG shall provide to TTC full disclosure of all current and
future WBG Technology (as defined in 1.1) developments, designs, patent
applications, tests, and any certifications to date. WBG agrees to disclose to
TTC any interested parties in the Technology to enable TTC to incorporate such
interest in its marketing plans.
3. ADDITIONAL CONSULTING
3.1 TECHNICAL CONSULTING. WBG agrees to provide TTC with additional consultancy
services as may be reasonably required by TTC.
4. REPRESENTATIONS/WARRANTIES
4.1 RIGHT TO TECHNOLOGY. WBG represents and warrants to TTC that WBG has the
right to enter into this Agreement, including without limitation the right to
grant TTC the exclusive rights set forth in Paragraph 2.1 above.
5. POTENTIAL THIRD-PARTY INFRINGEMENT & OTHER PATENT ISSUES
5.1 NOTIFICATION. Each party shall notify the other party of the existence of
any potential infringement or misappropriation of the WBG Patent Rights and/or
WBG Technology by any third party within a reasonable time after acquiring
information sufficient to form a reasonable belief as to the existence of such
potential infringement or misappropriation.
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5.2 NON-ENFORCEMENT. In the event WBG does not immediately enforce the WBG
Patent Rights and/or WBG Technology against a third party which is potentially
infringing and/or misappropriating such rights, the presence of which is having
a substantial adverse economic effect upon the commercial activities of TTC
relating to this Agreement, TTC will have the right to enforce the WBG Patent
Rights and/or WBG Technology against the third party at its own expense. In this
event any penalties or remedies paid in favor of WBG shall be collected in full
by TTC.
6. CONFIDENTIALITY
6.1 CONFIDENTIALITY.
(a) Each party to this agreement agrees to keep in strictest confidence and not
(i) use for its own purposes or other than for the sole benefit of the
disclosing party or (ii) disclose or make available to any third party the
disclosing party's Confidential Information regarding Technology referred to in
1.1.
(b) Confidential Information may be disclosed only to those TTC determines (i)
reasonably require access to such information for the purposes contemplated
hereby, (ii) have been informed of the confidential nature of the Confidential
Information and (iii) agree to act in accordance with the terms and conditions
of this Agreement.
(c) Notwithstanding the foregoing, nothing herein shall limit the disclosure of
such Confidential Information which: (i) is legally in the possession of the
receiving party prior to receipt thereof from the disclosing party; or (ii)
enters into the public domain through no fault of the receiving party or its
employ; or (iii) is disclosed to the receiving party without restrictions or
breach of any duty of confidentiality by a third party who has the right to make
such disclosure; or (iv) is independently developed by or for the receiving
party without reference to the disclosing party's Confidential Information;
(d) In the event the receiving party is required by law or legal process to
disclose any Confidential Information, the receiving party shall provide prompt
notice of such to the disclosing party so that legal protection for the
Confidential Information may be sought. In the event such protection is not
obtained, the receiving party's compliance with the non-disclosure provisions of
this Agreement, to the extent required to comply with such law or legal process,
shall be waived.
(e) All Confidential Information and any copies or derivatives thereof in what
ever form shall be returned to the disclosing party upon its request or upon
completion or termination of the Services.
6.2 Each party acknowledges that money damages would not be an adequate remedy
for breach of this Agreement and that the disclosing party shall be entitled to
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specific performance, in addition to such other remedies as may be available at
law or in equity, for any such breach.
6.3 Should any provision of this Agreement be held to be illegal or
unenforceable, such holding shall not affect the validity of the remainder of
this Agreement.
6.4 This Confidentiality clause shall survive and remain in effect for five
years and shall survive any termination of this Agreement.
7. INDEMNIFICATION
7.1 WBG. TTC shall be solely responsible and/or liable for any and all actions
undertaken by TTC under this Agreement.
7.2 TTC. WBG shall be solely responsible and/or liable for any and all actions
undertaken by WBG under this Agreement.
8. DISPUTE RESOLUTION
8.1 MEDIATION.
(a) Any controversy or claim arising out of or relating to this Agreement, or
the breach thereof, shall be first addressed in mediation proceedings between
the parties. The location of such proceedings shall be at Los Angeles County,
California.
(b) Mediation proceedings shall be initiated by providing notification to the
other party pursuant to Paragraph 10.3 in which the party desiring mediation
designates one of its executive officers to be its representative for the
mediation proceedings and in which the subject matter of the controversy or
claim is specifically identified. The receiving party shall thereafter designate
one of its executive officers to be its representative for the mediation
proceedings, such designation to be made within five (5) business days after
receiving notification from the initiating party and to be submitted in writing
to the Initiating party pursuant to Paragraph 10.3.
(c) The party-designated executive officers shall, following a reasonable
investigation period not to exceed sixty (60) days, initiate negotiations to
resolve the dispute. In the event the parties do not reach an agreement to
resolve the claim or controversy within sixty (60) days after negotiations are
initiated, the claim or controversy shall be settled by binding arbitration
pursuant to Paragraph 8.2.
8.2 ARBITRATION. Any controversy or claim arising out of or relating to this
Agreement, or the breach thereof, which is not resolved by mediation pursuant to
Paragraph 8.1, shall be settled by arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, and judgment upon the
award rendered by the arbitrators may be entered in any court having competent
jurisdiction thereof. Prior to any arbitration hearing, each party shall make
available to the other party and upon the request of the other party documents
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and witnesses relevant to the issues in arbitration. The location of any such
arbitration proceedings shall be Los Angeles, California.
9. TERM/TERMINATION
9.1 TERM. The initial term of this Agreement shall expire when the last patents
expire, subject to any earlier termination pursuant to Paragraph 10.7 below.
This term may be extended upon the mutual written agreement of the parties.
9.2 TERMINATION. This Agreement may be terminated by either party upon the
written consent of both parties or if the other party breaches any material
obligation under this Agreement and fails to diligently proceed to cure such
breach within sixty (60) days after receipt of written notification from the
terminating party which sets forth the basis of the material breach and the
terminating party's intent to terminate the Agreement due to the material
breach.
9.3 SELL-OFF RIGHTS. Upon termination of this Agreement for any reason, TTC
shall have the right to dispose of all Licensed Products on hand at the time of
termination and to produce sufficient Licensed Products to fulfill all
commitments for the Licensed Products, provided, however that TTC shall make all
reports and make all payments required under this Agreement.
10. MISCELLANEOUS
10.1 ASSIGNMENT. Neither party may assign this Agreement, in whole or in part,
without the prior written consent of the other party; except; however, that
either party may assign, without the other part's prior written consent, all
rights under or realized pursuant to this Agreement to a purchaser of all or
substantially all of the assets of the party to which the Agreement relates, or
in the event of the merger, to the surviving entity, provided that any such
purchaser or surviving entity agrees in writing to undertake all corresponding
obligations hereunder.
10.2 AGENCY. No agency relationship is established between the parties by this
Agreement, and neither party will have the right and will not attempt to bind,
act for, or otherwise make representations on behalf of the other party unless
expressly agreed in writing. Each party shall be responsible for the indemnity
of the other party with respect to any claims resulting from any acts or
omissions in breach of this paragraph.
10.3 NOTICE. Any notice, demand, or other communication required or permitted in
connection with this Agreement shall be in writing and shall be sufficiently
given or made if:
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(a) Delivered in person during normal business hours on a business day and left
with a receptionist or other responsible employee of the relevant party at the
applicable address set forth below;
(b) Sent by registered mail; or
(c) Sent by an electronic means of sending messages, including telex or
facsimile transmission, which produces a paper record ("Electronic
Transmission") during normal business hours on a business day charges prepaid
and confirmed by prepaid first class mail;
If to TTC: Transmission Technology Corporation
ATTN: Xxx Xxxxxx
000 Xxxx Xxxxxx, Xxxxx X
Xxxxxx, Xxxxx 00000
If to WBG: W.B.G., Inc.
ATTN: X. Xxxxxx Goldsworthy
00000-00 Xxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
10.4 ENTIRE AGREEMENT. This agreement constitutes the entire agreement and
understanding relating to the subject matter hereof, and supersedes all previous
communications, proposals, representations, and agreements, whether oral or
written, relating hereto.
10.5 MODIFICATION. This Agreement may only be modified by a further written
agreement executed by authorized representatives of both parties.
10.6 NON-WAIVER. A waiver of any right hereunder by either party on any occasion
shall not in any way constitute a waiver of such right or any other right on any
subsequent occasion.
10.7 SURVIVING TERMS AND CONDITIONS. Articles 8, and 9 shall survive any
termination of this Agreement.
10.8 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
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ON THIS the 7th day of May, 2001 and IN WITNESS HEREOF, and by their signatures
below, the undersigned individuals represent that they have the requisite
authority to bind their respective entities to the terms and conditions set
forth above.
W.B.G., INC. TRANSMISSION TECHNOLOGY
CORPORATION
/s/ X. XXXXXX XXXXXXXXXXX /s/ C. XXXXXXX XXXXXXXXX
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X. Xxxxxx Xxxxxxxxxxx, President C. Xxxxxxx Xxxxxxxxx, President
Witnessed by: Witnessed by:
/s/ XXXXXX XXXXXXX /s/ XXXXXX X XXXXXXXX
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