LICENSE OF TECHNOLOGY AND TRADE SECRETS
Parties
This License Agreement is made by and between XXXXXXX ADVANCED
TECHNOLOGIES, INC., A Nevada Corporation, its successors and/or assigns,
("Licensor"), and, XXXXX ENGINEERED COMPETITION COMPONENTS, INC., a Nevada
corporation, with its principal office located in Tempe, Arizona ("Licensee").
Recitals
The Licensor is the owner of the entire right in and to patents,
trademarks, and certain trade secret information concerning proprietary secret
processes, techniques, tooling, customers, designs and proprietary know-how for
the design and manufacture of the Center Fire Two Valve Cylinder Head Kits and
Assemblies for the Big Block Chevrolet Engines. Licensee desires to obtain a
scope of use license, and the Licensor is willing to grant, subject to the terms
and conditions set forth in this Agreement, the licenses from the Licensor, for
the specific scope of use and in the designated territory, to use the Licensor's
intellectual property in the manufacture and sale in the after market of Center
Fire Valve Cylinder Head Kits and Assemblies for Big Block Chevrolet Engine
applications.
Terms of Agreement
Article I
Certain Definitions
Section 1.1 Use Throughout. Terms defined in this Article I and
parenthetically elsewhere shall have the same meaning throughout this Agreement.
Defined terms may be used in the singular or plural.
Section 1.2 "Technology" means:
1.2.1 The Licensor's secret processes, techniques, tooling designs,
product designs and proprietary know-how and custom made proprietary machinery
and tooling, plants, technology arising from and protected by the following U.S.
Patents owned by Licensor:
U.S. Patent Number 4,838,219 for an Intake Port;
U.S. Patent Number 4,976,231 for an Intake Port;
U.S. Patent Number 4,815,706 for Valves; and,
U.S. Patent Number 5,445,135 for Combustion Xxxxxxxx
AND, certain trade secret information concerning proprietary secret
processes, techniques, tooling, equipment, designs, customer lists, and
proprietary know-how for the design and manufacture of the following products
(limited to aftermarket sales):
Center Fire Valve Cylinder Head Kite and Accessories for Chevrolet Big
Block Engines; and
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Strictly subject to the requirements of Section 10.1 hereof, the
non-exclusive, aftermarket use of the following Trademarks of Licensor solely
upon the products to be manufactured pursuant to this agreement, to wit:
1. "XXXXXXX"
2. "MAX FLOW" (for use with valves)
3. "CENTER FIRE"
4. "TORQUE POWER"
5. "HIGH VELOCITY" (for use with ports)
Section 1.3 "Developments" means any and all improvements and
developments, whether or not patented, irrespective of the maker thereof,
relating to or derived from the Technology or its use, including, without
limitation, any process, method, technique or know-how.
Section 1.4 "Patents" means any patents which may issue in the
Territory on the Technology described in Section 1.2.1, and all renewals of such
patents, if any.
Section 1.5 "Territory" means worldwide.
Section 1.6 "Aftermarket sale" means sales for use by individual owner
of automobiles, trucks, recreational vehicles, static and/or stationary engines,
and marine application (specifically subject to the limitations stated
hereinbelow); and specifically precludes sales by Licensee to any OEM
manufactures including, but not limited to, General Motors, Ford, and Chrysler.
As to all marine applications, License grants to Licensee this License
under the specific understanding and agreement that Licensee will sell
exclusively to XXXXXXXX, or to such other successor as solely designated by
Licensor, under the terms and conditions attached hereto as Exhibit "C",
including, but not limited to, Licensee payment to Licensor of a royalty of TEN
PERCENT (10%) of all Moines received by Licensee from marine sales, which
royalties to be paid separately and independently of the royalties required of
Licensee under this Agreement, and which marine royalties shall be payable
quarterly. Licensor retains all rights as stated hereinbelow and in Exhibit 'C',
including, but not limited to, product inspection and accounting arising from
marine sales under Exhibit 'C', for any such marine sales.
Section 1.7 "Revenue(s)" means the invoice price contracted by Licensee
in a bona fide commercial transaction between unaffiliated parties and shall not
include freight charges, and/or taxes on the invoice price.
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Article II
Grant of License; Disclosure of Developments
Section 2.1 Grant. Subject to this Agreement's terms and conditions,
the Licensor hereby grants to the extent that it lawfully may, to the Licensee,
the right to use the Technology and the Developments disclosed under Section
2.2, for the manufacture and sale of Center Fire Two Valve Cylinder Head Kits
and Accessories for Chevrolet Big Block Engines, solely for Aftermarket Sale, in
the designated Territory, during the License Term set forth in Section 9.1.
Licensor further grants a right of first refusal limited to any new Center Fire
Two Valve Cylinder Head Kits and Accessories product. The Licensor specifically
reserves all rights in and to the Technology other than the rights granted
Licensee herein.
2.1.1 Marking. Licensee agrees that all products sold pursuant to this
license shall be clearly marked with the subject matter patent number (8) and/or
designation of registered trademark (s).
Section 2.2 Sublicenses/Assignment
2.2.1 The license granted to the licensee under Section 2.1 does not
include the right to sublicense the Technology and the Developments to others in
the Territory without the express written permission of Licensor for such
sublicenses which may be granted or denied at the sole discretion of Licensor.
Any such sublicense, if allowed, shall be upon the same terms and conditions
granted Licensee herein. The sole exception hereto is the agreed XXXXXXXX (or
successor) exclusive sale agreement, the terms of which are set forth in Exhibit
'C' hereto.
2.2.2 The rights granted to Licensee hereunder are not assignable
without the express, written consent of Licensor which may be granted or denied
at the sole discretion of Licensor. Any such assignment, if allowed, shall be
upon the same terms and conditions granted Licensee herein.
Section 2.3 Reservation of Rights. Subject to the Licensee's right to
use the same pursuant to the terms of this Agreement, the Licensor reserves all
proprietary rights in and to all discoveries, inventions, patent rights, trade
secrets, know-how or other proprietary data embodied in the Technology or the
Developments. The Licensee agrees to receive and use the Technology and the
Developments for the terms of the License granted under Section 9.1 and the
subject to such reservation, and agrees to cease all use of Technology or
Developments upon termination of such license. Licensee acknowledges that the
Technology licensed herein is of a sensitive nature and is the trade secret and
proprietary intellectual property of Licensor and hereby accepts Licensor's
confidential disclosure to Licensee of the Technology pursuant to the terms of
this contract.
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Section 2.4 CARB or Federal Requirements. Licensee acknowledges that
the California Air Resources Board and/or other state and/or Federal agencies
may require the Licensee and/or resellers of Licensee's products, to apply for
and receive exemption status (50 state legal) allowing the products produces
under license herein to be sold for aftermarket installation. Such requirements
may change due to changes in the law from time to time. The parties hereto agree
that the reasonable cost incurred is such requirements will be borne equally
between the parties. In the event Licensee desires to engage in projects
utilizing the Technology, which projects might require additional governmental
requirements, such requirements will be borne by Licensee. Licensee acknowledges
that any and all responsibility for ongoing compliance in manufacture is that of
the Licensee.
Article III
Commencement of Disclosure
3.1 Deliveries. Subject to the terms and conditions of this Agreement,
the Licensor shall, within 30 days after the signing of this Agreement, commence
any additional disclosure of the Technology and Developments to the Licensee, by
delivering to the Licensee copies of the Technology Documents and the drawings
and other technical documentation in the Licensor's possession.
Article IV
Parties Independent
Section 4.1 Status of Parties. Nothing in this Agreement shall be
construed to constitute the Licensee as the partner, employee or agent of the
Licensor, not shall either party have any authority to bind the other party in
any respect, it being intended that each shall remain an independent party,
responsible only for its own actions.
Article V
Consideration
Section 5.1 Initial Lease/Installment Payments. Licensor agrees to
license the subject matter technology, sell the present inventory (Exhibit 'A')
and lease the tooling (Exhibit 'B') to Licensee for the sum of $ 400,000.00,
plus running royalties, and Licensee agrees to license the subject matter
technology, buy the present inventory (Exhibit 'A') and lease the tooling
(Exhibit 'B') from Licensor for the sum of $ 400,000.00, plus running royalties.
Licensee shall pay $ 50,000.00 (non-refundable) to Licensor on September 16,
1997, with the remaining balance payable in twenty four equal monthly payments,
plus interest calculated at eight percent (8%) per annum commencing December 1,
1997 and continuing on the first day of each following month until paid in full.
Said payments, timely made, are agreed to be a material provision of this
agreement. The tooling shall remain with Licensor's established vendors until
the $ 350,000.00, plus
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interest, balance of the initial, non-refundable license/lease/royalty
pre-payment hereunder shall be paid in full. This Agreement shall also serve as
a secured promissory not, with all Technology pledged for performance. Upon full
and timely payment of the initial, non-refundable license/lease/royalty
pre-payment hereunder, licensee may purchase the tooling (Exhibit 'B') from
Licensor for $ 1.00.
Section 5.2 Running Royalty. In consideration of Licensor's disclosure
of the Technology, and, in consideration for the scope of use license granted by
the Licensor for continued use of the Technology, and the performance of the
Licensor's other obligations under this Agreement, the Licensee shall pay to the
Licensor running royalties equal to the percentages of 5% of the revenues for
any and all products sold (except marine) by Licensee which utilize any of the
Technology licensed to Licensee herein. Additionally, this License is subject to
an agreed non-refundable, minimum monthly royalty payment, in the amount of $
5,000.00. Said monthly minimum royalty shall be due on October 1, 1998 and on
the first day of each month thereafter for the life of this License. Said
minimum monthly royalty, as paid, may be applied toward the total running
royalty payments due upon revenues (except for marine) during the quarter in
which the month occurs, but may not be carried forward future occurring
quarters. Running royalty payments shall be payable quarterly beginning one year
from the date of execution of this License Agreement, i.e.: on August 1, 1998.
The separate royalties payable for marine shall also be payable at the same time
as the running royalties herein, but shall be paid by separate cheque and with
separate accounting. The minimum monthly royalty shall not be credited to the
quarterly marine running royalty payments.
5.2.1 Quarterly running royalties payable under this License to be paid
within 21 calender days after the end of each such quarter by bank check or wire
transfer to Licensor's designated account.
Section 5.3 Royalty Statements. All royalty payments shall be
accompanied by royalty statements, certified by the Licensee and financial
officer, setting forth the Net Revenues of the Licensee and the calculation of
the amounts of royalties and other sums payable to the Licensor under this
Agreement (including any currency conversion), all in such detail as the
Licensor may reasonably request. Licensee shall provide separate payments and
accounting for marine.
Section 5.4 Payment. All payments tendered to the Licensor by the
Licensee under this Agreement shall be made in United States dollars, without
any deductions. Payments shall be made at the Licensor's address for receipt of
notice under Section 11.2, or at such other address or deposited in such bank
account as the Licensor may from time to time designate by notice to the
Licensee.
Section 5.5 Additional Consideration. Licensee agrees to sell products
produced pursuant to this agreement to Licensor for the lowest price said
products are offered to Licensee's best customers.
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Section 5.6 Default Remedies. In the event of Licensee insolvency or
any breach of the terms herein, specifically including, the timely making of all
payments required hereunder, then shall this agreement terminate (except for the
confidentiality provisions hereinbelow), and all rights shall immediately revest
in Licensor, including marine. All payments made to date of termination shall be
deemed non-refundable royalties. Licensee shall have rights to cure any default
as follows:
(a) Any default of payment (initial purchase or royalty),
including, but not limited to, failure to timely pay or
insufficient funds, shall be curable by Licensor's receipt of
full payment of the amount due within three days of FAX notice
of such default;
(b) Any other default hereof shall be curable by Licensee by
fully complying within thirty (30) days notice by Licensor.
Notice of any default shall be reasonably identified, as shall
requirements for cure. Default Notice may be by FAX.
Article VI
Confidentiality
Section 6.1 Nondisclosure of Confidential Information. The Licensee
shall at all times during and after the term of this Agreement hold in the
strictest confidence, and shall not directly or indirectly disclose to others,
or use for any purpose other than as contemplated in this Agreement, any of the
Technology or the Developments disclosed to the Licensee by the Licensor or as
to the Developments of the Licensee. Notwithstanding the foregoing, the Licensee
shall have the right to make disclosures of the Technology and such Developments
on a strict "need-to-know" basis to the Licensee's employees, and, with the
Licensor's prior approval, the Licensee's prospective suppliers and contractors,
and to whom such disclosure is necessary for the performance of this Agreement;
provided that the Licensee shall first obtain from each employee, supplier or
contrived and their respective employee confidentiality agreements with respect
to the Technology and such Developments in the form substantially similar to the
requirements of this Agreement, and the Licensee shall promptly deliver copies
of all such confidentiality agreements to the Licensor.
Section 6.2 Exceptions. The Licensee shall not be held to a duty of
confidentiality for any of the Technology or any of the Developments which:
6.2.1 is, or becomes, generally known in the manufacturing industry by
reason of a single integrated publication; or
6.2.2 after its disclosure to the Licensee, is received by the Licensee
in an integrated form from an independent third party whose disclosure of such
Technology or Developments shall not constitute a direct or indirect breach by
that third party of any duty of confidentiality owed to the Licensee.
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6.3 Documents. Licensor may designate as confidential, by legending
prominently as such, any drawings, charts, blueprints, specifications, magnetic
cards, films or other documentary or physical manifestation or disclosure of any
of the Technology or the Developments (cooectively, the "Documents"). The
Licensee shall legend prominently any Documents it may prepare which embody any
Technology or Developments, to identify them as confidential trade secret
proprietary information.
Section 6.4 Licensor Confidentiality Obligations. The Licensor shall
comply with the provision of confidentiality in Section 6.1 through 6.3 in
connection with any disclosures of confidential information made to the
Licensor.
Section 6.5 Unique Character of Confidential Information. The Licensee
acknowledges that the Technology and Developments to be disclosure by the
Licensor are of a special and unique character which gives them a peculiar valve
and that consequently any wrongful use or disclosure of the Technology or
Developments will cause injury not readily measurable in monetary damages, and
therefore irreparable. Accordingly, whether in court action or arbitration, the
Licensor shall be entitled to the remedies of injunction, specific performance
and other equitable relief to redress any such breach, and no proof of special
damages shall be necessary for the enforcement of or for any action upon such
obligations. Without limiting the generality of the foregoing, the Licensor
shall have the right to require the surrender and return to the Licensor of all
Technology and Developments disclosure by the Licensor, and all Documents and
material related hereto.
Section 6.6 Non Competition by Licensor. Licensor herein agrees that it
will not compete with Licensee in the aftermarket sales of Center Fire Valve
Cylinder Head Kits and Assemblies for Big Block Chevrolet Engine Applications,
in the Field of Use, and for the term, granted herein to Licensee, so long as
Licensee shall not be in breach of any term hereof. Upon breach, as stated
above, all rights revest in Licensor, this non-compete shall automatically
terminate as to Licensor, and Licensee shall cease and desist from any and all
use.
Section 6.7 Survival. The obligations of the Licensee and the Licensor
under this Article VI shall, except as otherwise expressly provided, survive
termination of this Agreement.
Article VII
The Licensee's Conduct of Business
Section 7.3 Compliance With Laws. The Licensee represents and warrants
to the Licensor that in the Licensee's performance of its obligations under this
Agreement, the Licensee shall indemnify the Licensor against any loss which the
Licensor may incur as a result of any claim or demand which nay be made against
the Licensor based upon the Licensee's failure to so comply.
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Section 7.4 Insurance. as a material term, Licensee shall promptly (and
prior to any sale of products using the Technology and/or taking possession of
the inventory) cause its product liability, advertising claims and general
liability insurance to be modified to name the Licensor as an additional
insured. Licensee shall maintain such insurance in an aggregate amount not less
than one million dollars (U.S. #1,000,000) during the term of the license
granted under Section 2.1. The Licensee shall promptly provide the Licensor with
a certificate of insurance from Licensee's insurance company evidencing such
coverage and the naming of Licensor as also insured. Licensee shall indemnify
and hold Licensor harmless from any and all claims arising from the Licensee's
use of the Technology.
Article VIII
Infringement
Section 8.1 Notice of Infringement.
8.1.1 The Licensee shall promptly notify the Licensor of any
instance which comes to the Licensee's attention involving a possible
misappropriation of any trade secret, or infringement of any Patent or other
proprietary right of the Licensor, relating to the Licensed Technology or the
Developments.
8.1.2 The Licensor shall make such inquiry as it deems
appropriate. If, in its sole judgment, the Licensor elects to bring an
infringement or misappropriation or other suit, the Licensee shall at the
request of the Licensor, promptly lend all reasonable assistance to the
Licensor, in the prosecution of such suit.
8.1.3 Nothing contained in this Agreement shall be construed
as an obligation of the Licensor or the Licensee, to bring or to prosecute any
suit or other proceeding against any third party for misappropriation of trade
secrets, or infringement of any patent or other intellectual property rights.
Section 8.2 Notice of Claims.
8.2.1. The Licensee shall give prompt notice to the Licensor
of any claim, action or proceeding pending or threatened against the Licensee,
alleging misappropriation of trade secrets or infringement of any patent or
other proprietary rights asserted by a third party, based on the use by the
Licensee or its sublicensees' use of the Technology or any Developments. If the
Licensee's or any or its sublicensees' use of the Technology and Developments is
in accordance with the provisions of this Agreement, and if the Licensor shall
so request, the Licensee shall make, and shall cause its sublicensees to make,
any practical modification of it's or their practice under the license or
sublicense granted, amendment of this Agreement or other means (without the
obligation of the Licensor or the Licensee to incur any material expense in
request thereof) in order to avoid suit or reduce the potential adverse effect
of any such claim or action.
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8.2.2 Licensor knows of no prior patents or prior art which
would render the rights granted herein an infringement upon same. Nothing
contained in this Agreement shall be construed as a warranty by the patent or
other intellectual property rights of third parties, and the Licensor disclaims
any such warranty.
8.2.3 Licensee is responsible for all costs related to or
occurring from any returns of products produces by Licensee using the technology
licensed herein whether returned for defective workmanship or part failures or
defects covered by warranty or otherwise. As between the parties only, any
design flaw, as noticed by Licensee to Licensor, and as supported by sufficient
evidence, which would require a re-design, such re-design will be done by
Licensor at no cost to Licensee. Nothing herein shall change Licensee's sole
responsibility for defective workmanship, part failures, defects or product
liability of any kind as to any and all third parties, of which Licensor is
indemnified and held harmless.
Article IX
Term; Termination
Section 9.1 License Term. The initial term of the License granted under
Section 2.1 shall commence on the date of this Agreement and shall continue in
perpetuity so long as Licensee adheres to the terms and conditions of this
license agreement.
Section 9.3 Termination. The License granted to the Licensee under
Section 2.1 may be terminated upon notice as follows:
9.3.1 by the Licensor, if the other party has materially
breached or failed to punctually perform any of its duties or obligations under
the Agreement and such breach remains uncured or such failure to perform
continues for at least 30 days after the aggrieved party has given notice to the
other party; or
9.3.2 by the Licensor, if the Licensee is insolvent or becomes
the subject of a voluntary petition in bankruptcy for its reorganiization or
liquidation, or makes any assignment for the benefit of its creditors, or if a
trustee or receiver of its property is appointed, or if the Licensee takes or is
subjected to any other similar action based upon its inability to meet its
financial obligations; or
9.3.3 by the Licensor, if the Licensee assigns this Agreement
or any of its rights under this Agreement without obtaining the Licensor's prior
written consent; or
9.3.4 by the Licensor, if there is a sale of substantially all
of the assets or a majority of the shares of the Licensee; or
9.3.5 by the Licensor, if the aggregate running royalties to
be received by the Licensor under Article V, during any one year period,
commencing for calendar year 1998, shall be less than one hundred thousand
dollars [S $ 100,000] in total, including separate..........
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Section 9.4 Effects of Expiration or Termination. If the term of the
License granted to the Licensee under Section 2.1 or if the shall License is
terminated, all rights of the Licensee under the License shall cease and the
Licensee shall cease to use any part of the Technology or the Developments and
shall immediately return and surrender to the Licensor all of the Technology,
the custom-made machinery, the developments disclosed by the Licensor, any and
all Documents and all other tangible disclosures of the Technology or
Developments, including the separate marine license, which shall then vest in
Licensor.
Section 9.5 Obligations Surrounding Termination. Not-with- standing any
termination of the License granted to Licensee under Section 2.1, and any
exercise by either party of any rights or remedies hereunder, the following
rights and obligations shall survive any such termination or exercise of rights
to the degree necessary to permit their complete fulfillment or discharge:
9.5.1 the Licensor's right to receive or recover, and the
Licensee's obligation to pay, the amount of all royalties and other sums payable
under Article V which is vested in, accrued or accruable at the time of
termination or exercise of such rights, and any adjustments in payments required
thereafter as a result of any audits under Section 7.2; and
9.5.2 Article VI, and any subsequent undertaking or agreement,
that may be in effect at the time of termination with respect to the maintenance
of the confidentiality or secrecy of the Technology and or the Developments and
covenant not to complete; and
9.5.3 any rights or remedies of either party under Article
VIII or X and any cause of action or claims of either party whether or not
accrued at the time of termination, because of any breach of or failure to
perform any obligation under this
Agreement.
Article X
Trademarks
10.1 The Licensee acknowledges the validity of all trademark
registrations and applications in the USA and/or foreign countries, owned by the
Licensor and herein licensed for use to Licensee for the term of, and pursuant
to the terms of this Agreement. The Licensee further acknowledges that the
Licensor is the sole owner of the entire right, title, and interest in and to
the trademarks covered by these registrations and/or applications hereinafter
called "Xxxx or Marks," and any and all goodwill in said Marks now or in the
future.
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The Licensee shall not do any thing or commit any act which might
prejudice or adversely affect the vitality of the marks and any such act shall
be considered a material breach of this agreement. Licensee shall cease to use
the marks, or ant similar marks, in any manner on the expiration or other
termination of this Agreement.
The Licensee further agreed that it will do nothing inconsistent with
such Licenseeship and that all use of the marks by Licensee shall inure solely
to the benefit of, and be on behalf of Licensor. Licensee agrees to be bound by
the requirements of this Section 10 for the duration of the term of the license
granted herein. Quality in Xxxx and Technology is a material provision of this
Agreement.
10.1 (a) Quality Standards
Licensee agrees that the nature and quality of all services rendered by
Licensee in connection with the Xxxx/Technology; all goods sold or used by
Licensee under the Xxxx/Technology; and all related advertising, promotional and
other related uses of the Xxxx/Technology by Licensee shall conform to the
quality standards set by, and be under the control of, Licensor. Nothing herein
shall be deemed an acceptance by Licensor of any responsibility for the product
liability.
10.2 (b) Quality Maintenance
Licensee agrees to cooperate with Licensor in facilitating Licensor's
control of such nature and quality, to permit reasonable inspection of
Licensee's operation, and to supply Licensor with specimens of all uses of the
Xxxx/Technology upon request. Nothing herein shall be deemed an acceptance by
Licensor of any responsibility for product liability.
10.1 Form of Use
Licensee agrees to use the Xxxx only in the form and manner and with
appropriate legends as prescribed from time to time by Licensor, and not to use
any other trademark or service xxxx in combination with the Xxxx without first
obtaining the prior written approval of Licensor.
Article XI
General Provisions
Section 11.1 Notices. All notice required or permitted under this
Agreement shall be in writing and shall be effective upon personal delivery to
or being sent by registered or certified mail, return receipt requested, postage
fully prepaid and addressed to the respective parties at their addresses set
forth below or to any other address designated by the parties at a later date:
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Licensor: Xxxxxxx Advanced Technologies, Inc.
c/o Xxxxxxx, Xxxxxx & Xxxxx
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Licensee: Xxxxxx Xxxxx, President
Xxxxx Engineered Competition Components, Inc.
0000 Xxxxx Xxxxxx Xxxx
Xxxxx, Xxxxxxx 00000
Section 11.2 Binding Effect. The Agreement shall be binding upon and
shall inure to the benefit of the Licensor and the Licensee and of their
respective successors and permitted assigns.
Section 11.3 Waiver.
(a) Requirements of Writing - No waiver of, acquiescence to , or
consent to any breach of or default of any term or condition contained in this
Agreement by Licensor shall be of any force or effect unless same is in writing,
specifically identified, and signed by Licensor.
(b) No Implied Waiver - No waiver of, acquiescence to, or consent to
any breach of or default of any term or condition contained in this Agreement by
Licensor pursuant to subparagraph (a), above, shall be deemed, express or
implied, generally or specifically, to be a waiver, consent, or acquiescence to
any other breach or default.
(c) No delay or omission in the exercise of any right or remedy by
Licensor shall impair such right or remedy or be construed as a waiver. A
consent by Licensor to or approval of any act shall not be deemed to waive or
render unnecessary consent to or approval of any other or subsequent act.
Section 11.4 Severability. If for any reason in any jurisdiction in
which any provision of this Agreement is sought to be enforced, any one or more
of the provision of this Agreement shall be held to be invalid, illegal or
unenforceable in any respect, such holding shall not affect any other provision
of this Agreement and this Agreement shall be construed as if such invalid,
illegal or unenforceable provision had never been contained herein.
Section 11.5 Governing Law. This Agreement shall be governed by and
construed in accordance with the law of the State of California with all
applicable contracts deemed made and to be performed wholly in that State. The
federal law and public policy of the United States of America shall not govern
this Agreement or a fact of its interpretation, save as to operation of Licenses
under U.S. Patents. The venue for the interpretation and or enforcement of any
provision of this agreement is mutually agreed by the parties hereto to be
proper court of jurisdiction located in San Diego, California.
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Section 11.6 Legal Fees and Costs. The prevailing party to any action
to interpret and or enforce any provision of this Agreement shall be intitled to
recover from the unsuccessful party(ies) to this Agreement, all costs, expenses
and actual attorney's fees relating to the enforcement of, interpretation of, or
any litigation, arbitration, mediation or private settlement, relating to this
Agreement, in addition to any other relief that may be afforded.
Section 11.7 Accounting/Audit/Inspection. For the term of this License,
Licensee shall maintain true, accurate and complete books and records of all
transactions and uses of the Technology, including sales made under the separate
marine agreement (Exhibit 'C'). Licensee shall make quarterly reports of gross
revenues and costs, concurrently with the royalty statements. Licensor shall
have the right to inspect such books and records at any time, with fourty-eight
hours notice to Licensee. Licensee hereby agrees that court order for production
of accounting, in the event of Licensee's failure to produce the records ad
required hereunder, may be granted. Licensor shall have the right to audit all
books and records, not more than once per year. Such audit will be conducted by
a representative of Licensor's sole choice, and will be paid for by Licensor,
except in the event that such audit reveals an under-reporting of three percent
(3%) or greater, in which event Licensee shall pay all costs of audit. Licensee
and Licensor shall promptly pay any adjustment required between them as a result
of any such audit. True, accurate and complete books and records, as well as
audit and inspection rights are a material provision of this License Agreement.
Section 11.7 Counterparts. This Agreement may be executed in several
counterparts, each of which shall constitute an original, but all of which
together shall constitute one and the same instrument. The headings contained in
this Agreement have been inserted for convenience of reference only and shall
not modify, define, expand or limit any of the provisions of this Agreement.
Section 11.8 Challenge. A legal challenge to the validity of any
patent, trademark, or the other Technology licensed herein shall be a material
breach of this agreement should such a challenge be unsuccessful and/or should
Licensee not prevail in such an action.
Section 11.9 Drafting Ambiguities. Each party to this Agreement and its
counsel have reviewed and revised this Agreement or has had the opportunity to
do so. The rule of construction that any ambiguities are to be resolved against
the drafting party shall not be employed in the interpretation of this Agreement
or of any amendments or exhibits to this Agreement.
TK 13 JF
Initials
Section 11.10 Entire Agreement. This Agreement, which includes its
Addendums, and Exhibits, constitutes the entire agreement of the parties
relating to its subject matter, supersedes all prior oral or written
understanding or agreements regarding that subject matter and may not be
amended, modified or canceled except by a written instrument executed by both
the Licensor and Licensee.
IN WITNESS WHEREOF, LICENSOR and LICENSEE have executed this Agreement
in duplicate as of July 29, 1997 and affixed the corporate seal of the parties
hereto. The signatories of the respective parties hereto, by affixing their
signatures to this agreement, each individually warrant their ability to bind
the party on whose behalf they are executing this agreement.
LICENSOR:
XXXXXXX ADVANCED TECHNOLOGY, INC.
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------
Xxxxx X. Xxxxxxx,
President
LICENSEE:
XXXXX ENGINEERED COMPETITION COMPONENTS INC.
By: /s/ Xxxxxx Xxxxx
------------------------------------
Xxxxxx Xxxxx,
President
