EXHIBIT 10.23
LICENSE AGREEMENT
This License Agreement is made on the 26th day of September, 2003, by
Global Energy Group, Inc. a Delaware Corporation, whose principal place of
business is 0000 Xxxxxxx Xxxxx, Xxxxxx, XX 00000 ("Licensor") and Global Energy
Distribution Group, L.L.C. an Oklahoma Limited Liability Company, whose
principal address is 0000 Xxxx 00xx, Xxxxx, XX 00000 ("Licensee").
Licensor desires to conditionally license to Licensee and Licensee
desires to conditionally license from Licensor certain intellectual property
owned by Licensor (whether acquired or developed internally, and whether
previously or in the future) in accordance with this agreement and in accordance
with the Agreement for Distribution of Global Energy Products ("Distribution
Agreement") executed by Licensor and Licensee contemporaneously with this
agreement.
Therefore, the parties agree as follows:
ARTICLE 1. DEFINITION OF TERMS
The following definitions apply in this agreement:
1.1 "LICENSED PRODUCT" means any product or component thereof
manufactured as contemplated by this agreement and incorporating any
intellectual property owned by Licensor (whether acquired or developed
internally, and whether previously or in the future), including but not limited
to the intellectual property embodied within the Licensed Patents and/or
Licensed Technology:
1.1.1 Global currently holds the exclusive rights to seven
U.S. patents and seven patent-pending applications pursuant to a series
of agreements with the inventors of the underlying technologies. Under
the terms of these agreements, Licensee has the exclusive right to
pursue commercial development of the patented technologies. A brief
summary of each patent follows:
USP# 4,599,870 (RECENTLY EXPIRED)
A refrigeration heat recovery system for producing usable hot
water from a refrigeration system's waste heat, using a
natural force to provide water flow through the heat exchanger
(thermosyphon effect) rather than using a pump.
USP# 5,970,728
Utilization of multiple staged common circuit compressors to
provide for higher heat output from a heat pump at low outside
ambient conditions. Heat output is maintained, or even
increased, as outside temperatures fall.
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USP# 6,070,423
A system to provide first, liquid refrigerant subcooling by
means of evaporative cooling utilizing the condensate water,
and second, a system for providing hot gas discharge
refrigerant precooling by means of evaporative cooling. Both
combining to give greater capacity without requiring an
increase in input power, and even possibly decreasing the
required input power.
USP# 6,116,048
An evaporator design that provides counterflow temperature
conditions to the direction of air flow by sectionalizing the
various temperature gradients found in evaporators and
arranging the sections to provide a temperature gradient that
places the warmest section in front of colder and subsequently
colder sections. Provides for optimized heat exchange as well
as improved dehumidification.
USP# 6,167,715 B1
A direct refrigerant to ground (geothermal) heat exchange
system for subcooling and desuperheating (or postheating in
the heat mode of a heat pump) the refrigerant of an air-cooled
air conditioner, refrigeration system or heat pump. No
secondary fluid or pumping system required. Provides near full
geothermal system efficiency.
USP# 6,237,359 B1
Provides liquid refrigerant subcooling by utilizing the cold
harvest water and/or meltwater discharging from the ice
machine to increase ice production capacity of the ice
machine.
USP# 6,000,170 (RELEASED BACK TO INVENTOR)
A system consisting of multiple parallel reflectively coated
tubes whose inflation is controlled by a controller that
provides for controlled shading in a greenhouse system during
times of high solar loading of the greenhouse, and provides
for minimized heat loss at night, especially in cold climates.
USP# 6,442,903 B1
The structural construction methodology for a greenhouse
inflatable insulative covering to be used to reduce heat
losses and overheating of greenhouses.
USP# 6,460,358 B1
A heat exchanger that reduces an evaporator's flash gas loss
region and reduces the superheat region, allowing for improved
heat exchange by the evaporator itself, thereby allowing for
increased refrigeration mass flow and therefore increased
system refrigeration capacity.
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1.2 "LICENSED PATENTS" means all U.S. and foreign patents owned by
Licensor that are necessary to or useful in the manufacture of Licensed
Products, including without limitation those described in Section 1.1.1 of this
License Agreement.
1.3 "LICENSED TECHNOLOGY" means all technology, technical
information, trade secrets, know-how, ideas, and other intellectual property now
owned or hereafter acquired by Licensor and necessary to or useful in the
manufacture of Licensed Products. The term Licensed Technology includes all of
Licensor's right, title, and interest in all future rights that Licensor may
acquire from any other person that are necessary to or useful in the manufacture
of the Licensed Products.
1.4 "LICENSED MARKS" means all trademarks, trade names, and
service marks owned by Licensor and associated with the Licensed Products.
1.5 "AFFILIATE," when used in reference to a party, means any
person, firm, corporation, or other entity that (i) directly, indirectly,
partially, or wholly owns or controls the party; (ii) is directly, indirectly,
partially, or wholly owned or controlled by the party; (iii) is directly,
indirectly, partially, or wholly under common control with the party; (iv) is in
a specially favored relationship or course of dealing with the party; (v) is an
agent, employee, partner, or joint venturer of the party; or (vi) has a
fiduciary or other special relationship with the party; provided, however, that,
for the purposes of this Agreement, Licensor and Licensee shall be deemed not to
be Affiliates of each other.
ARTICLE 2. LICENSE GRANTS
2.1 LICENSE. Licensor grants to Licensee a worldwide license to
use the Licensed Patents, the Licensed Technology, and the Licensed Marks in
connection with Licensee's production, service, and sale of Licensed Products.
Licensor further authorizes Licensee to copy, reproduce and use copyrighted
material furnished by Licensor to Licensee ("Copyrighted Material"). However,
Licensee's use of the Licensed Patents, the Licensed Technology, the Licensed
Marks, and the Copyrighted Material is strictly limited to uses that conform to
this Agreement, and the Licensee's sales of Licensed Products will be strictly
in accordance with the Distribution Agreement.
2.2 EXCLUSIVITY. This agreement does not in any way affect
Licensor's own right to use the Licensed Patents, the Licensed Technology, the
Licensed Marks, and the Copyrighted Material. With that exception, the license
is exclusive.
2.3 DURATION. This agreement and the license it grants will become
and remain effective, if at all, only while the Distribution Agreement is in
effect, and then only if and during such periods as provided in the Distribution
Agreement. If this agreement becomes effective, the license will be perpetual
but subject to termination under this agreement.
2.3.1 The license will terminate as to rights under any patent
or copyright upon the expiration of that patent or copyright.
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2.3.2 The license is terminable at Licensor's option if
Licensee does not pay any royalty owed to Licensor under this agreement
when it is due and then fails to cure the non-payment within ten days
after receiving written notice of non-payment from Licensor.
2.3.3 Licensee may terminate this agreement in its entirety by
giving written notice of termination to Licensor at least 90 days
before the intended termination date and paying Licensor all royalties
owed to Licensor through such date. Notice of termination given by
Licensee will be binding on all affiliates and sublicensees of
Licensee.
2.3.3 Notwithstanding anything herein to the contrary, unless
and until such time as (i) Global Energy and Global Energy Acquisition
Group, L.L.C., an Oklahoma limited liability company ("GEAG") shall
have entered into the "Funding Agreement" (as contemplated by the
Distribution Agreement), and (ii) GEAG shall have made loans to Global
Energy in the aggregate amount of at least $500,000 as contemplated by
the Funding Agreement, this Agreement and all rights of Licensee
hereunder shall be and remain nonexclusive. If, after the Funding
Agreement becomes effective, GEAG fails to make any loan required to be
made by it under or pursuant to the Funding Agreement, this Agreement
and all rights of Licensee hereunder shall become and thereafter remain
nonexclusive. During any period of time during which the rights of
Licensee hereunder shall be nonexclusive, Global Energy shall then be
permitted to license all rights licensed hereunder to other licensees
and otherwise arrange for manufacture and sale of its products and
other products incorporating its intellectual property, under terms
similar to or different from those under this Agreement and in the same
or different territories.
2.4 LOCATIONS. Licensee may use the Licensed Patents and Licensed
Technology at one or more plant sites (each, a "Licensed Site"). Licensee will
notify Licensor of each Licensed Site promptly after it is selected. If Licensee
terminates operations at a Licensed Site, Licensee will move all records and
equipment incorporating the practice of any of the Licensed Patents or Licensed
Technology to another Licensed Site or will cause all such records and equipment
to be destroyed.
2.5 COOPERATION AND SUPPORT. Promptly after this agreement takes
effect, Licensor will (a) deliver to Licensee copies of the relevant documents
of Licensor documenting the Licensed Technology and the practice of the Licensed
Technology and the Licensed Patents, and (b) make available to Licensee
Licensor's personnel, both employees and independent contractors, who are
knowledgeable with respect to the manufacture of the Licensed Products and the
use and development of the Licensed Technology ("Support Personnel") to assist
Licensee at the Licensed Sites during the term of this Agreement. The time
required by Licensee under this provision will not exceed one man-month during
any twelve-month period for each of up to five Support Personnel. Licensee will
reimburse Licensor for the direct salary cost of each of the
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Support Personnel for the time they are assisting Licensee. Licensor agrees that
any of its personnel whose employment is terminated by Licensor for any reason
may be employed by the Licensee to assist Licensee with its use of the Licensed
Technology and the manufacture of the Licensed Products.
2.6 LIMITED RIGHT TO SUBLICENSE. The license granted in this
agreement includes a limited right to sublicense the Licensed Patents and the
Licensed Technology to another person for the sole purpose of allowing that
person to produce Licensed Products exclusively for sale by Licensee, and/or to
service or sell Licensed Products exclusively for Licensee. It is a condition
precedent to Licensee's right to grant a sublicense that: (i) Licensor be given
prior written notice identifying the proposed sublicensee; (ii) the sublicense
enter into a written sublicense agreement approved by Licensor, which approval
will not be unreasonably withheld or delayed; and (iii) Licensee guarantee in
writing sublicensee's due and faithful compliance with the sublicense agreement.
2.7 ROYALTY. Licensee shall pay Licensor a quarterly royalty equal to 10%
of total manufacturing costs for Products produced and/or sold under this
Agreement. Licensee agrees to provide to Licensor quarterly reports of such
manufacturing costs. Licensee will afford a certified public accounting firm
designated by Licensor and reasonably acceptable to Licensee the opportunity to
audit such manufacturing costs and the related data and calculations from time
to time. Licensee will pay the cost of each audit in which the auditor
determines that the total royalties required to have been paid for a particular
quarter exceed royalties actually paid (prior to commencement of the audit) for
such quarter by more than 2%.
2.8 REPRESENTATIONS AND WARRANTIES.
2.8.1 Licensor represents and warrants to Licensee that (i)
the Licensed Technology, the Licensed Marks and the Copyrighted
Material do not and will not infringe upon any copyrights, trademarks,
patents or any other rights of any person; (ii) Licensor has all
requisite corporate power and authority to enter into and perform its
obligations under this Agreement, including its exhibits, each of which
has been duly authorized, validly executed and delivered and
constitutes a binding and enforceable obligation of Licensor, and (iii)
the execution, delivery and performance of this Agreement by Licensor
does not violate or conflict with any applicable law, rule, regulation,
or any order, judgment or agreement to which Licensor is a party or by
which it is bound.
2.8.2 Licensee represents and warrants to Licensor that: (i)
Licensee has all requisite corporate power and authority to enter into
and perform its obligations under this Agreement, including its
exhibits, each of which has been duly authorized, validly executed and
delivered and constitutes a binding and enforceable obligation of
Licensee; (ii) the execution, delivery and performance of this
Agreement by Licensee does not violate or conflict with any applicable
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law, rule regulation, or any order judgment or agreement to which
Licensee is a party or by which it is bound.
ARTICLE 3. CONFIDENTIALITY
3.1 TITLE TO LICENSED TECHNOLOGY. The Licensed Technology includes
confidential and proprietary information and trade secrets. The Licensed
Technology and all related documents, drawings, designs, and prototypes that are
disclosed or furnished to Licensee under this agreement will remain the property
of Licensor.
3.2 NON-DISCLOSURE OF CONFIDENTIAL INFORMATION. Licensee will hold
all Licensed Technology in strict confidence and, except as expressly allowed by
this agreement, will not disclose the existence or content of any Licensed
Technology to any third party. Licensee may disclose Licensed Technology to
Licensee's employees, agents, contractors, and advisers who have first executed
a confidentiality agreement approved as to form by Licensor and then only to the
extent necessary for Licensee to exercise its rights under this agreement. If it
becomes necessary for Licensee to disclose any of the Licensed Technology to a
sublicensee, Licensee will first obtain from the sublicensee a duly executed
non-disclosure agreement approved as to form by Licensor. Licensee will assure
compliance with and will indemnify Licensor for breaches of non-disclosure
covenants by Licensee's employees, agents, contractors, advisors, and
sublicensees. The confidentiality obligations under this section will not apply
to information that can reasonably be demonstrated:
(A) was at the time of disclosure part of the public domain or
thereafter becomes part of the public domain through no act or
omission in breach of this License Agreement;
(B) was lawfully received after disclosure from a third party,
provided, however, that such information was not wrongfully
obtained by said third party, directly or indirectly, from the
disclosing party or a person under a duty of confidentiality
to the Licensor;
(C) was required to be disclosed pursuant to official governmental
process, order or demand.
3.3 USE OF LICENSED TECHNOLOGY. Licensee and each sublicensee to
whom Licensee discloses Licensed Technology, will use the Licensed Technology
solely for the purposes specified in this agreement.
3.4 PROTECTION OF CONFIDENTIAL INFORMATION. Licensee will take all
reasonable precautions to protect and preserve the confidentiality of the
Licensed Technology and all related evaluation materials, documents, drawings,
sketches, designs, products, and samples. Such precautions will be at least as
rigorous as those used by Licensee in the protection of its own confidential
information. Licensee further covenants and agrees that it will obtain from each
of its employees given access to
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Licensed Technology an agreement with respect to the protection of such
proprietary information and trade secrets adequate to protect the
confidentiality thereof and Licensee accepts responsibility for assuring
compliance with such agreement by its employees. Licensee shall be responsible
for assuring compliance by each sublicensee with its obligation to protect
confidential information.
ARTICLE 4. ENFORCEMENT OF INTELLECTUAL PROPERTY RIGHTS
4.1 NO OBLIGATION TO ACT. Neither Licensee nor Licensor shall have
the obligation under this License Agreement to bring suit for the infringement
of any Licensed Patent or the misappropriation of the Licensed Technology
against third parties. Notwithstanding the foregoing, Licensee agrees to
promptly notify Licensor in the event that it becomes aware of any infringement
or misappropriation of the Licensed Patents or the Licensed Technology, together
with all facts and particulars related thereto of which it has knowledge.
4.2 PROSECUTION OF ACTIONS. Licensor shall have the right to take
whatever action Licensor in its sole discretion deems appropriate, including
appropriate court action, to terminate the infringement or misappropriation, or
to enter into a settlement agreement with the infringing or misappropriating
party or parties. Such action shall include the defense of any action in which
the validity or infringement of any paten right is placed in issue by a third
party, e.g. by way of a declaratory judgment action, opposition, re-examination
request or nullity suit. Any such action shall be under the sole control of
Licensor, at Licensor's expense, and with counsel of Licensor's choosing. To the
extent that any such infringement or misappropriation bears directly upon the
rights granted the Licensee hereunder, the Licensee shall, at its expense, be
entitled to have co-counsel of its choice observe the progress of such action.
Licensee agrees to cooperate fully with Licensor and to provide, at Licensor's
expense, any reasonable assistance that Licensor might require in said action,
including joining with Licensor as a named party in any lawsuit in which
Licensor may become involved in its efforts to terminate the infringement or
misappropriation or confirm the validity of any Licensed Patent. Licensor agrees
that it will not enter into any agreement in settlement of any such action that
would restrict or impair the rights granted the Licensee hereunder or require
any material payment by Licensee to any person in order to exercise such rights
without the consent of the Licensee.
4.3 DAMAGES. Notwithstanding other provisions of this Agreement,
any damages received by Licensor as a result of action taken under Section 4.2,
or any amounts received by Licensor pursuant to a settlement thereof, including
any royalties received by Licensor under a settlement sublicense, shall belong
to Licensor.
ARTICLE 5. RESOLVING CHARGES OF INFRINGEMENT
AND MISAPPROPRIATION
5.1 DEFENSE OF CLAIMS. If a charge of infringement or
misappropriation shall be brought by a third party against either Licensor or
Licensee or both of them alleging
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that the sale, use, or manufacture of products under the Licensed Patents or the
Licensed Technology infringes the intellectual property rights of such third
party, Licensor shall indemnify, defend and hold harmless Licensee, and Licensor
shall take all necessary actions to resolve the charge of infringement or
misappropriation in such a manner as to avoid disturbance of Licensee's rights
under this Agreement, except to the extent, if any, as may result from the
wrongful act or omission of Licensee and/or its Affiliates. To the extent that
any such claim of infringement or misappropriation might impair the Licensee's
exercise of the license granted hereunder, Licensor shall give Licensee prompt
notice of such claim and the relevant particulars relating thereto of which
Licensor is aware; Licensee shall also be entitled, at its expense, to have
co-counsel of its choice observe the progress of such action.
5.2 PATENT APPLICATIONS. Licensor shall have the right to
determine whether a United States or foreign patent application should be filed
with respect to a product or process that is included in the Licensed
Technology. In the event that Licensee believes that it would be desirable to
file a U.S. or foreign patent application with respect to a product or process
that is included in the Licensed Technology, it shall so notify Licensor in
writing including with such notice the form of proposed application to be filed.
Licensor shall have a right of first refusal to prepare, file and prosecute such
patent application. If Licensor declines to exercise such right of first
refusal, then Licensee shall have the right, at its cost and expense, to
prepare, file and prosecute such patent application for the ownership and
account of the Licensor. Upon the issue of any patent as a result of such
action, such patent shall be the sole and exclusive property of Licensor, but
subject to the license granted by Section 2.1 above.
5.2.1 Each of Licensor and Licensee shall provide reasonable
cooperation to the preparation, filing and prosecution of a patent
application under this Section 5.2 by the other; such cooperation shall
include access to correspondence with and proposed responses to the
U.S. Patent Office and any applicable foreign patent offices with
respect to the progress of any such application. Such cooperation shall
also include the execution, without the payment of any compensation
therefor, of all such applications, instruments and documents as may be
reasonably requested in order to carry out the purpose and intent of
this Section 5.2.
5.2.2 As the owner of any patent issued under this Section
5.2, Licensor shall have the responsibility for any maintenance or
other periodic fees or expenses necessary to maintain the validity or
effectiveness of any such patent, the costs of which will be paid by
Licensee from time to time upon submission to Licensee of invoices
therefore, provided however, that if the Licensor shall give Licensee
written notice of its intent to abandon any such patent in any foreign
jurisdiction, Licensee may preserve such patent in such jurisdiction by
committing in writing to such maintenance or other periodic fees or
expenses in such jurisdiction, in which case Licensor shall continue
the effectiveness of such patent in such jurisdiction for so long as
Licensee continues to pay such amounts.
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ARTICLE 6. MISCELLANEOUS PROVISIONS
6.1 NOTICES. Unless otherwise specifically provided in this
License Agreement, all notices required or permitted to be given hereunder shall
be in writing and shall be transmitted; (I) by registered or certified mail,
return receipt requested; (II) by a nationally recognized express courier
service, with receipt confirmed; or (III) by telecopier, with receipt confirmed.
In each case, such transmission shall be addressed to the party to whom such
notice is required or permitted to be given:
If to Licensor: At its principal office in Odessa, Florida.
If to Licensee: Global Energy Distribution Group, L.L.C.
0000 Xxxx 00xx
Xxxxx, XX 00000
or to any such other person or address as may be designated by notice given in
accordance with this Section 6.1. All notices shall be deemed to have been given
when received.
6.2 GOVERNING LAW. This License Agreement shall be governed by and
construed in accordance with the laws of the State of Oklahoma.
6.3 ARBITRATION. All disputes which may arise between the parties
out of or in connection with this Agreement, or the interpretation or breach
thereof, shall be settled by binding arbitration in Tulsa, Oklahoma pursuant to
the commercial arbitration rules of the American Arbitration Association (the
"AAA"), by a single arbitrator selected in accordance with the rules of the AAA.
Judgment on the arbitration award may be entered into any court having
jurisdiction thereof. Either party may seek any interim or preliminary relief
from a court of competent jurisdiction in Tulsa, Oklahoma necessary to protect
its rights or property pending the completion of arbitration. Should either
party file an action contrary to this provision, the other party may recover
attorneys fees and costs of responding to such action. Upon any breach of or
default under this Agreement by any party, no action shall be taken with respect
thereto against the breaching or defaulting party unless and until such breach
or default remains uncured thirty (30) days after written notice thereof to the
party in breach or default.
6.4 SEVERABILITY. The parties hereto do not intend to violate any
public policy, statutory or common law. However, if any sentence, paragraph,
clause or combination of this Agreement is in violation of any state or federal
law or is found to be otherwise unenforceable by a court from which there is no
appeal, or no appeal is taken; such sentences, paragraphs, clauses, or
combinations of the same shall be deleted or amended in a mutually agreeable
manner, and the remainder of this Agreement shall remain binding.
6.5 ASSIGNMENT. This License Agreement and the rights granted
hereunder may be assigned by Licensee only with prior consent of Licensor, which
will not be
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unreasonably withheld, provided that Licensee may assign its rights under this
Agreement to any person acquiring substantially all assets of Licensee in a
merger, sale of assets or comparable transaction. The covenants herein contained
shall be binding upon and inure to the benefit to the parties hereto and their
heirs, permitted assigns, successors and legal representatives.
6.6 HEADINGS. The headings or titles of Articles and Sections in
this License Agreement are for convenience of reference only and are not
intended to be conclusive as to the meaning or construction of the provisions of
this Agreement.
6.7 SEVERABILITY. Any provision or clause hereof which shall be
invalidated by virtue of the fact that it is prohibited by law shall be
ineffective to the extent of such illegality; however, this shall in no way
affect the remaining provisions of this Agreement, and this Agreement shall be
interpreted as if such clause or provision were not contained herein, unless
such ineffective provision or clause shall be so significant as to materially
affect this Agreement.
6.8 COUNTERPARTS. This Agreement may be executed and delivered in
a number of counterparts, each of which, when so executed and delivered, shall
be an original and all of such counterparts shall together constitute one and
the same Agreement.
6.9 ENTIRE AGREEMENT; MODIFICATION. This Agreement and the annexes
hereto contains the entire agreement and understanding of the parties hereto
with respect to the subject matter hereof and supersedes any other oral or
written agreements or understandings with respect thereto, which agreements or
understandings, if any, are hereby terminated. This Agreement has been entered
into for the independent consideration recited in this Agreement and is not to
be construed to be a part of, or subject to, any other agreement or
understanding between the parties, except as expressly provided herein or
therein. This Agreement may not be modified in any manner whatsoever except by a
writing signed by Licensor and Licensee.
Except where the context otherwise requires, words imparting the
singular shall include the plural and vice versa, words denoting any gender
shall include all genders and words denoting persons shall include bodies
corporate and vice versa.
The parties have read, understand, and agree to the foregoing terms and
conditions and have executed this License Agreement this 26th day of September,
2003.
LICENSOR: LICENSEE:
BY: /s/ BY: /s/
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NAME: NAME:
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TITLE: TITLE:
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