Exhibit 10.3
MASTER AGREEMENT
BY AND BETWEEN
Y2 ULTRA-FILTER, INC.
AND
US GLOBAL AEROSPACE, INC.
JUNE 19, 2003
This Master Agreement (the "AGREEMENT") is made and entered into as of
June 19, 2003, by and between Y2 Ultra-Filter, Inc., a Wyoming corporation
having its place of business at 0000 Xxxx 0xx Xxxxxx, Xxxxxxxx 000, Xxxxx,
Xxxxxxx 00000 ("Y2"), and US Global Aerospace, Inc., a Delaware corporation
having its place of business at 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx
Xxxx, Xxxxxx 00000 ("USGA").
RECITALS
Y2 and USGA wish to enter into an agreement to provide governing terms
and provisions for agreements between them, including, without limitation,
agreements for the sale of products by each of them to the other and joint
marketing of products.
AGREEMENT
SECTION 1. DEFINITIONS
Section 1.01 "AGREEMENT" shall have the meaning assigned in the preamble.
Section 1.02 "CONFIDENTIAL INFORMATION" shall mean proprietary and
other confidential information that the Furnishing Party has or will develop,
compile or own, or that the Furnishing Party receives from third parties under
conditions of confidentiality. The term is to be broadly interpreted and
includes (a) information that has, or could have, commercial value for the
business in which the Furnishing Party is engaged, or in which the Furnishing
Party may engage at a later time, and (b) information that, if disclosed without
authorization, could be detrimental to the economic interests of the Furnishing
Party. Confidential Information includes, without limitation, any patent, patent
application, copyright, trademark, trade name, service xxxx, service name,
"know-how", negative "know-how", trade secrets, customer and supplier
identities, characteristics and terms of agreements, details of customer or
consultant contracts, pricing policies, operational methods, marketing plans or
strategies, product development techniques or plans, business acquisition plans,
science or technical information, ideas, discoveries, designs, computer programs
(including source codes), financial forecasts, unpublished financial
information, budgets, processes, procedures, formulae, improvements or other
proprietary or intellectual property of the Furnishing Party, whether or not in
written or
tangible form, and whether or not registered, and including all memoranda,
notes, summaries, plans, reports, records, documents and other evidence thereof.
"Confidential Information" does not include (a) any information known
to the Receiving Party prior to disclosure by the Furnishing Party or its
Representatives, (b) any information which becomes available on a
non-confidential basis from a source other than the Furnishing Party who is not
bound by a confidentiality agreement with, or any other contractual, legal or
fiduciary obligation of fiduciary of confidentiality to, the Receiving Party or
any related party with respect to such information, and (iii) any information
which is or becomes generally available to the public other than as a result of
a disclosure by such Receiving Party's Representatives in breach of this
Agreement.
Section 1.03 "DIRECT COSTS" shall include all of the costs and expenses
directly associated with the manufacture and distribution of a product,
including, without limitation, materials, labor (including all overhead expenses
associated with labor), shipping and direct costs of sales and/or marketing of
such product.
Section 1.04 "EXCLUSIVE MARKETS" shall mean the following:
o China;
o Hong Kong; and
o Cargo and passenger aircraft worldwide;
Section 1.05 "FURNISHING PARTY" shall have the meaning assigned in
Section 6.02(a).
Section 1.06 "INTELLECTUAL PROPERTY" shall mean, with respect to each
Party, all patents, trademarks, service marks, trade names, copyrights, trade
secrets, licenses, information, designs, computer software, know-how and
proprietary rights and processes necessary for the conduct of such Party's
business as now conducted and as proposed to be conducted.
Section 1.07 "JOINT MARKETING PLAN" shall have the meaning assigned in
Section 4.03 of this Agreement.
Section 1.08 "JOINT PATENTS" shall have the meaning assigned in Section
6.01 of this Agreement.
Section 1.09 A "JOINT PRODUCT" shall be any product created by USGA or
Y2 that contains both USGA Products and Y2 Products.
Section 1.10 The "JOINT PRODUCT COST" shall be, for each applicable
Joint Product, the aggregate of all Direct Costs attributable to such Joint
Product incurred by USGA and Y2.
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Section 1.11 The "MARKETS" shall consist of (a) the Exclusive Markets,
and (b) with respect to any particular Subagreement, markets or Third Parties
identified as Markets therein.
Section 1.12 "PARTY" shall mean either USGA or Y2, as appropriate in
the circumstances.
Section 1.13 "PRODUCTS" shall mean either USGA Products or Y2 Products,
as appropriate in the circumstances.
Section 1.14 "PURCHASING PARTY" shall have the meaning assigned in
Section 3.01(a).
Section 1.15 "RECEIVING PARTY" shall have the meaning assigned in
Section 6.02(a).
Section 1.16 "REPRESENTATIVES" shall have the meaning assigned in
Section 6.02(a)
Section 1.17 "SELLING PARTY" shall have the meaning assigned in Section
3.01(a).
Section 1.18 "SEPARATE PRODUCT" shall mean, as appropriate, any (a) Y2
Product or (b) USGA Product; that is not part of a Joint Product at the time of
the determination of the type of product.
Section 1.19 "SEPARATE PRODUCT COST" shall mean, for each applicable
Separate Product, the Selling Party's total Direct Costs of producing such
Separate Product.
Section 1.20 "SEPARATE PRODUCT PRICE" shall mean the price at which the
Selling Party shall sell the Separate Product to the Purchasing Party. Such
Separate Product Price shall be equal to the Separate Product Cost plus ten
percent (10%) of such Separate Product Cost.
Section 1.21 "SHARED PROFITS" shall mean the total sales price in any
transaction with a Third Party Purchaser of all Joint Products sold less the
Joint Production Costs attributed to the Joint Products sold.
Section 1.22 "SUBAGREEMENT" shall mean any agreement between the
Parties that is intended to be governed by this Master Agreement.
Section 1.23 "SUBCONTRACT" shall mean any Subagreement or part of any
Subagreement that calls for the manufacture of Y2 products by USGA in accordance
with Section 3.08 of this Master Agreement.
Section 1.24 "TERM" shall be the period beginning on the date provided
in the preamble to this Agreement and ending when validly terminated pursuant to
the provisions of this Agreement.
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Section 1.25 "THIRD PARTY" shall mean any person or entity other than
USGA and Y2.
Section 1.26 "THIRD PARTY PURCHASER" shall mean any Third Party that
orders Joint Products, Separate Products, or any combination of Joint Products
and Separate Products from either USGA or Y2.
Section 1.27 "UNIQUE COSTS" shall have the meaning assigned in Section
3.07.
Section 1.28 "UNPAID PARTY" shall have the meaning assigned in Section
7.04(c).
Section 1.29 "USGA" shall have the meaning assigned in the preamble.
Section 1.30 "USGA PRODUCTS" shall be (a) those products listed on
Exhibit B to this Agreement, as amended from time to time by written agreement
of the Parties, and (b) with respect to any particular Subagreement, products
identified as USGA Products within such Subagreement.
Section 1.31 "Y2" shall have the meaning assigned in the preamble.
Section 1.32 "Y2 PRODUCTS" shall be (a) those products listed on
Exhibit A to this Agreement, as amended from time to time by written agreement
of the Parties, and (b) with respect to any particular Subagreement, products
identified as Y2 Products within such Subagreement.
SECTION 2. PRODUCTS
Section 2.01 Y2 Products. During the Term, and subject to the
provisions of this Agreement, Y2 shall manufacture and sell such quantities of
Y2 Products to USGA as the Parties may agree upon in any Subagreement. Unless
mutually agreed to in writing by the Parties, Y2 Products sold to USGA are to be
(a) used by USGA in the manufacture of Joint Products or (b) sold by USGA in a
transaction including the sale of Joint Products.
Section 2.02 USGA Products. During the Term, and subject to the
provisions of this Agreement, USGA shall manufacture and sell such quantities of
USGA Products to Y2 as the Parties may agree upon in any Subagreement. The USGA
Products sold to Y2 are to be (a) used by Y2 in the manufacture of Joint
Products or (b) sold by Y2 in a transaction including the sale of Joint
Products.
Section 2.03 Subagreements. The Parties shall enter into a Subagreement
for any sale pursuant to Section 2.01 or Section 2.02 of this Agreement. If the
Parties do not negotiate and execute a Subagreement for such sale, the sale
shall still be governed by the terms of this Agreement.
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SECTION 3. SALES BY EITHER PARTY
Section 3.01 Purchase Orders.
(a) Either Party (the "PURCHASING PARTY") may submit a purchase order
for Separate Products to the other Party (the "SELLING PARTY") by any
commercially reasonable means, including but not limited to, postal delivery,
courier delivery, facsimile transmission, and electronic mail. The Selling Party
shall promptly confirm receipt of any purchase order.
(b) The Selling Party shall, within five (5) business days of its
receipt of a purchase order, accept or reject such purchase order; provided,
however, the Selling Party shall be obligated to accept and fulfill all purchase
orders for its Separate Products to be used by the Purchasing Party to make
Joint Products to fulfill existing purchase orders by Third Party Purchasers.
(c) The Parties shall hold meetings (in person or by teleconference) at
least twice per month for the purpose of discussing each Party's existing and
contemplated purchases from the other Party and sales to Third Parties.
Section 3.02 Purchase Order Contents. Each purchase order shall contain
the following information:
(a) Quantity and type of units of Separate Products to be shipped;
(b) Proposed Subagreement governing the purchase order;
(c) Payment Terms;
(d) Delivery schedule, by date, unit and quantity;
(e) Packaging process and method; and
(f) Destination, carrier and any other pertinent instructions.
Section 3.03 Delivery.
(a) Unless specified in a Subagreement or purchase order, a
Selling Party may use any commercially reasonable means to deliver Separate
Products to the Purchasing Party. Shipments shall be made FOB Manufacturing
Plant.
(b) If the Selling Party believes it will be unable to meet
the delivery dates set forth in any purchase order and/or any Exhibit to this
Agreement, it shall notify the Purchasing Party within three (3) business days
of its receipt of a purchase order, and suggest alternative delivery dates. The
Parties will negotiate in good faith to agree upon an acceptable delivery date.
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Section 3.04 Superiority of Master Agreement. Neither Party shall be bound by
any term or condition in any writing by the other Party that is inconsistent
with this Agreement or any applicable Subagreement unless, and except to the
extent, such provision was acknowledged and mutually agreed to by both Parties.
Section 3.05 Engineering Design Changes.
(a) If an engineering change is requested by a Third Party, a
Purchasing Party may request an engineering change order by sending, with the
applicable Separate Product purchase order, a written engineering change order.
If the Selling Party cannot or will not comply with the engineering change
order, it must notify the Purchasing Party within three (3) business days. If
the Selling Party can and will comply with such engineering change order it will
give to the Purchasing Party, within four (4) business days of receiving such
engineering change order, written notice of the estimated date by which, and
estimated cost at which, such engineering change order could be implemented.
Such engineering change order shall not be valid or enforceable unless, within
three (3) business days of receiving the estimate, the Purchasing Party
acknowledges and agrees to the dates and costs stated in the estimate by
countersigning the estimate and returning it to the Selling Party.
(b) If the date and/or cost stated in the estimate change by
more than three (3) days or ten percent (10%) of the estimated cost, whichever
is applicable, the Selling Party shall notify the Purchasing Party in writing of
the revised estimate within one (1) business day of becoming aware of such
change in estimate. Within one (1) business day of its receipt of a revised
estimate, the Purchasing Party must provide written notice of its acceptance of
the revised estimate or its cancellation of the underlying engineering change
order
Section 3.06 Product Quality. Unless the Parties otherwise agree, (a)
Separate Products sold by a Selling Party to a Purchasing Party shall be of at
least equal quality with the Separate Products sold by the Selling Party
directly to any Third Party, (b) each Party shall materially comply with all
quality programs it has in place during the Term, and (c) each Party shall take
all commercially reasonable efforts to produce Separate Products for sale to a
Purchasing Party and Joint Products at a quality level that is at least average
for the Markets. The Parties may mutually agree on specific quality standards in
any Subagreement, in which case such standards shall only apply to Separate
Products sold under that Subagreement, or in a written amendment of this
Agreement.
Section 3.07 Cancellation. Prior to delivery of Separate Products
pursuant to a Subagreement or purchase order, a Purchasing Party may cancel
delivery of such Separate Products, if an underlying order is canceled by a
Third Party Purchaser, by providing written notice to the Selling Party,
provided, however, that the Purchasing Party shall remain liable for the Unique
Costs incurred by the Selling Party prior to the time it receives the
cancellation notice. "UNIQUE COSTS" shall be those costs incurred by the Selling
Party in the manufacturing or production of Separate Products that cannot be
sold to any other Third Party in the ordinary course of the Selling Party's
business. The
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Purchasing Party may seek reimbursement of such Unique Costs from the Third
Party Purchaser.
Section 3.08 Subcontracts.
(a) By mutual agreement of the Parties, Y2 may subcontract
manufacturing and production of Y2 Products to USGA in accordance with the terms
of this Agreement or any applicable Subcontract.
(b) Within ten (10) business days of the first Subcontract
between USGA and Y2, Y2 shall deliver to USGA all information necessary to allow
USGA to manufacture and produce the applicable Y2 Product to the same quality
and design of Y2 Products produced by Y2.
(c) USGA's production of Y2 Products pursuant to a Subcontract
must materially comply with all requirements of the Joint Marketing Plan
applicable to such products, and with the quality requirements of Section 3.06.
(d) If Y2 subcontracts manufacturing and production of any Y2
Product to USGA, products produced by USGA under such Subcontract shall be
deemed Y2 Products. However, strictly for the purpose of determining Product
Costs and Shared Profits, these products shall be defined as Joint Products.
Section 3.09 Payment for Separate Products; Payment of Shared Profits.
(a) Unless the Parties agree otherwise in any Subagreement or
otherwise, a Selling Party shall invoice the Purchasing Party in accordance with
the Selling Party's standard practices and terms for the Separate Product Price
of any Separate Products sold to the Purchasing Party.
(b) Unless the Parties agree otherwise, the Purchasing Party
shall pay the undisputed amount of any invoice from the Selling Party within the
terms of such invoice.
(c) Unless the Parties agree otherwise in any Subagreement,
Shared Profits will be split evenly between the Parties.
(d) A Party shall make payment to the other Party of that
other Party's portion of Shared Profits within ten (10) days of receiving
payment from a Third Party Purchaser.
SECTION 4. JOINT MARKETING
Section 4.01 Branding. The Parties shall market all Joint Products
under the trade name "NanoFilter(TM)". Particular Joint Products may be
designated with a mutually agreed upon variation of the trade name
"NanoFilter(TM)". Separate Products of either Party sold in the same transaction
with Joint Products shall not be identified as "NaoFilter(TM)" related products.
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Section 4.02 Ownership of Trade Name. USGA shall own exclusively all
rights, privileges and interests in the trade name "NanoFilter(TM)" and any
other trademarks, service marks, copyrights or other intellectual property
rights derived from the trade name "NanoFilter(TM)".
Section 4.03 Joint Marketing Plan.
(a) USGA and Y2 shall negotiate and jointly prepare a
marketing plan for the marketing of Joint Products (the "JOINT MARKETING PLAN").
This Plan shall include an annual budget. The Parties shall meet at least once
per calendar quarter, in person or telephonically, to review, revise and update
the Joint Marketing Plan.
(b) Expenses incurred by either Party acting in accordance
with the Joint Marketing Plan and that Plan's budget shall be split evenly
between the Parties. Expenses incurred by either Party for marketing other than
in accordance with the Joint Marketing Plan shall be the separate responsibility
of that Party.
Section 4.04 Exclusivity Provision. In the Exclusive Markets, Y2 shall
only have the right to sell and market Joint Products, subject to and in
accordance with the terms of this Agreement or a Subagreement, and shall not
have the right to sell or market any Y2 Products, whether separately or in
combination with the product(s) of a third party, without USGA's express prior
written consent.
Section 4.05 Warranty of Joint Products.
(a) Joint Products shall be sold with warranties only as to
material and workmanship. All other warranties shall be specifically disclaimed
in any sales document with respect to Joint Products. The Parties shall
establish a mutually-approved disclaimer document applicable to Joint Product
sales. Both Parties are required to use this common disclaimer document on all
sales documents for Joint Products.
(b) When notified of any warranty claim with respect to a
Joint Product, the Party receiving the notification shall promptly notify the
other Party of such warranty claim.
(c) The Party receiving the notification shall promptly
attempt to trace the fault in such Joint Product to either Party's Separate
Product.
(i) If the fault can be traced to either Party's
Separate Product, that Party shall be responsible for all costs and
burden of repair or replacement of the Joint Product, and shall
indemnify and promptly reimburse the other Party for any actual
expenses such other Party incurs with respect to the repair or
replacement of such Joint Product.
(ii) If the fault cannot be traced to either Party's
Separate Product, the Parties shall evenly split the costs of repair or
replacement of the defective Joint Product. The Party receiving the
notification of the defect shall take the lead in repair or replacement
of the Joint Product, including repair or
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removal of the defective Joint Product and installation of any
replacement Joint Product. Such Party shall invoice the other Party
for its share of the costs of such repair or replacement in accordance
with such Party's standard practices and terms.
(iii) In the case of faults on Joint Products
manufactured wholly by USGA under an appropriate subcontract, all costs
of claim resolution are for USGA's account.
SECTION 5. REPRESENTATIONS AND WARRANTIES
Section 5.01 Representations and Warranties of Y2. Y2 hereby represents
and warrants to USGA, as of the date of this Agreement and as of the date of
each Subagreement, as follows:
(a) All corporate action on the part of Y2 necessary for the
authorization of this Agreement and any Subagreement has been taken, and no
further consent or authorization of Y2, its Board of Directors or its
stockholders is required. This Agreement is, and each Subagreement when executed
and delivered will be, a valid and binding obligation of Y2 enforceable in
accordance with its terms, except (a) as limited by applicable bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium or other laws of
general application affecting enforcement of creditors' rights, and (b) general
principles of equity that restrict the availability of equitable or legal
remedies.
(b) Y2 owns or has the right to use, whether through
ownership, licensing or otherwise, all Intellectual Property significant to its
business and to the manufacture, production, marketing, sale and distribution of
Y2 Products. Except as would not have a material adverse impact on the validity
or value of any Intellectual Property: (i) no written claim of invalidity or
conflicting ownership rights with respect to any Intellectual Property has been
made by a third Party and no such Intellectual Property is the subject of any
pending or, to Y2's knowledge, threatened action, suit, claim, investigation,
arbitration or other proceeding; (ii) no person or entity has given notice to Y2
that the use of any Intellectual Property by Y2 is infringing or has infringed
any domestic or foreign patent, trademark, service xxxx, trade name, or
copyright or design right, or that Y2 has misappropriated or improperly used or
disclosed any trade secret, confidential information or know-how; (iii) the
making, using, selling, manufacturing, marketing, licensing, reproduction,
distribution, or publishing of any process, machine, manufacture or product
related to any Intellectual Property, does not and will not infringe any
domestic or foreign patent, trademark, service xxxx, trade name, copyright or
other intellectual property right of any Third Party, and does not and will not
involve the misappropriation or improper use or disclosure of any trade secrets,
confidential information or know-how of any Third Party; (iv) there exists no
prior act or current conduct or use by Y2 or any Third Party that would void or
invalidate any Intellectual Property; (v) the execution, delivery and
performance of this Agreement, and any Subagreement, if applicable, and the
consummation of the transactions contemplated hereby and thereby will not
breach, violate or conflict with any instrument or agreement concerning any
Intellectual Property, will not cause the forfeiture or termination of or
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give rise to a right of forfeiture or termination of any of the Intellectual
Property or impair the right of USGA to make, use, sell, license or dispose of,
or to bring any action for the infringement of, any Intellectual Property.
Section 5.02 Representations and Warranties of USGA. USGA hereby
represents and warrants to Y2, as of the date of this Agreement and as of the
date of each Subagreement, as follows:
(a) All corporate action on the part of USGA necessary for the
authorization of this Agreement and any Subagreement has been taken, and no
further consent or authorization of USGA, its Board of Directors or its
stockholders is required. This Agreement is, and each Subagreement when executed
and delivered will be, a valid and binding obligation of USGA enforceable in
accordance with its terms, except (a) as limited by applicable bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium or other laws of
general application affecting enforcement of creditors' rights, and (b) general
principles of equity that restrict the availability of equitable or legal
remedies.
(b) USGA owns or has the right to use, whether through
ownership, licensing or otherwise, all Intellectual Property significant to its
business and to the manufacture, production, marketing, sale and distribution of
USGA Products. Except as would not have a material adverse impact on the
validity or value of any Intellectual Property: (i) no written claim of
invalidity or conflicting ownership rights with respect to any Intellectual
Property has been made by a Third Party and no such Intellectual Property is the
subject of any pending or, to USGA's knowledge, threatened action, suit, claim,
investigation, arbitration or other proceeding; (ii) no person or entity has
given notice to USGA that the use of any Intellectual Property by USGA is
infringing or has infringed any domestic or foreign patent, trademark, service
xxxx, trade name, or copyright or design right, or that USGA has misappropriated
or improperly used or disclosed any trade secret, confidential information or
know-how; (iii) the making, using, selling, manufacturing, marketing, licensing,
reproduction, distribution, or publishing of any process, machine, manufacture
or product related to any Intellectual Property, does not and will not infringe
any domestic or foreign patent, trademark, service xxxx, trade name, copyright
or other intellectual property right of any Third Party, and does not and will
not involve the misappropriation or improper use or disclosure of any trade
secrets, confidential information or know-how of any Third Party; (iv) there
exists no prior act or current conduct or use by USGA or any Third Party that
would void or invalidate any Intellectual Property; (v) the execution, delivery
and performance of this Agreement, and any Subagreement, if applicable, and the
consummation of the transactions contemplated hereby and thereby will not
breach, violate or conflict with any instrument or agreement concerning any
Intellectual Property, will not cause the forfeiture or termination of or give
rise to a right of forfeiture or termination of any of the Intellectual Property
or impair the right of Y2 to make, use, sell, license or dispose of, or to bring
any action for the infringement of, any Intellectual Property.
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SECTION 6. INTELLECTUAL PROPERTY; CONFIDENTIALITY
Section 6.01 Ownership of Patents.
(a) The Parties shall individually own all rights, privileges
and interest in patents issued, patents pending and patent applications on
products or processes they currently own and/or developed .
(b) The Parties shall jointly own all rights, privileges and
interest in patents issued, patents pending and patent applications on products
jointly developed with respect to Joint Products ("JOINT PATENTS"). Neither
Party shall sell, assign (whether by operation of law or otherwise), or
otherwise transfer its interest in Joint Patents, except as provided in Section
6.01(c).
(c) Upon the termination of this Agreement, all rights,
titles, privileges and interests in Joint Patents shall remain jointly owned.
Upon termination of this Agreement, either Party has the right to purchase the
other Joint Patents Party's rights at an agreed upon value.
Section 6.02 Confidentiality.
(a) Each Party (a "RECEIVING PARTY") hereby agrees that, in
consideration for the other Party (the "FURNISHING PARTY") furnishing its
Confidential Information to such Receiving Party, (i) not to disclose any of the
Furnishing Party's Confidential Information to any person other than such
Receiving Party's agents, representatives and employees (collectively, its
"REPRESENTATIVES"), (ii) to inform its Representatives of the confidential
nature of the Confidential Information and of the requirement of each such
Representative to act in accordance with the terms and conditions of this
Section 6.02, (iii) not to reproduce all or any part of the Furnishing Party's
Confidential Information without the prior written permission of X0, (xx) not to
use any of the Furnishing Party's Confidential Information for any purpose other
than those contemplated by this Agreement.
(b) In the event a Receiving Party receives a request to
disclose all or any part of the Furnishing Party's Confidential Information
under the terms of a valid and effective subpoena or order issued by a court of
competent jurisdiction, such Receiving Party agrees to (i) immediately notify
the Furnishing Party of the existence, terms and circumstances surrounding such
a request, (ii) consult with the Furnishing Party on the advisability of taking
legally available steps to resist or narrow such request, and (iii) if
disclosure of any Confidential Information is required, exercise such Receiving
Party's best efforts to obtain an order or other reliable assurance that
confidential treatment will be accorded to such portion of the Confidential
Information which the Furnishing Party may designate. The Furnishing Party
agrees to assume, at its sole charge and expense, any costs that are the direct
result of actions taken at the direction or request of the Furnishing Party
pursuant to this Section 6.02(b) (and, if any payments are made by the Receiving
Party, to promptly reimburse such Receiving Party), including any legal fees
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and disbursements of legal counsel, that such Receiving Party incurs in excess
of those costs required to comply fully with any such subpoena or order.
(c) Unless otherwise required by law neither Party nor its
Representatives shall, without the other Party's written consent, disclose to
any person any of the specific terms, conditions or other facts with respect to
this Agreement.
(d) Without prejudice to the rights and remedies otherwise
available to the Furnishing Party, the Furnishing Party shall be entitled to
equitable relief by way of injunction if the Receiving Party or any of its
Representatives breaches or threatens to breach any of the provisions of this
Agreement.
SECTION 7. TERM; TERMINATION
Section 7.01 Initial Term. The term of this Agreement shall commence on
the date first written above and extend until the fifth anniversary of such date
unless extended by mutual agreement of the Parties or unless earlier terminated
pursuant to the provisions of Section 7.02 of this Agreement.
Section 7.02 Termination. The Agreement may be terminated prior to the
expiration of the Term by any of the following means:
(a) This Agreement may be terminated at any time upon the
mutual written agreement of both Parties;
(b) This Agreement may be terminated by either Party 60 days
after delivery of written notice to the other Party of such intent to terminate;
or
(c) If either Party is in material breach of this Agreement,
the other Party may terminate this Agreement 90 days after delivering written
notice of such breach to the breaching Party; provided, however, that if the
breaching Party cures such breach within the 90 day period, this Agreement may
not be terminated on the basis of such breach.
Section 7.03 Covenant Not to Terminate By Corporate Action. Except as
permitted in Section 7.02 of this Agreement, neither Party shall have the right
to terminate this Agreement or any Subagreement, or to make its performance
under this Agreement impossible, by any means, including, without limitation, by
sale or transfer of all its assets without concurrent transfer of this Agreement
in accordance with Section 8.09.
Section 7.04 Effect of Termination.
(a) Subject to Section 7.04(c), for so long as either Party
has not completed its performance under any Subagreement, but only with respect
to such executory Subagreement, both Parties covenant to comply with the terms
of this Agreement, as if it were in full effect and no act of termination had
taken place, regardless of any act of termination pursuant to Section 7.02.
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(b) For two (2) years after the termination of this Agreement,
each Party shall remain liable for all warranty expenses incurred or paid
pursuant to, and shall otherwise comply with, Section 4.05 of this Agreement.
(c) Notwithstanding anything else in this Agreement, a Party
(for purposes of this subsection, the "UNPAID PARTY") may cease its performance
under any Subagreement, upon providing written notice to the other Party, if
such other Party is more than 90 days delinquent in meeting its payment
obligations under the applicable Subagreement. The Unpaid Party must continue
its performance once the other Party has made all payments due and become
current in such payment obligations; provided, however, that if the other Party
does not become current in its payment obligations within one hundred eighty
(180) days of its receipt of the notice required by this subsection, the Unpaid
Party shall be permitted to terminate the applicable Subagreement upon delivery
of written notice of such termination to the other Party. Nothing in this
subsection shall be construed as allowing an Unpaid Party to terminate its
performance under any Subagreement for which the other Party is current in its
payment obligations.
(d) Any provision of this Agreement that, by its nature and
content, must survive the completion, rescission, termination or expiration of
this Agreement, in whole or in part, in order to achieve the fundamental
purposes of this Agreement (including, without limitation, Sections 4.02
("Ownership of Brand Name"), 6 ("Intellectual Property; Confidentiality"), 7
("Term; Termination"), and 8.14 ("Governing Law; Consent to Jurisdiction), as
well as all necessary definitions in Section 1, shall so survive and continue to
bind the Parties. Each Party hereto agrees to furnish such additional or
supplemental documents and instruments, and to take such actions, and to do such
other and further things as may be necessary or reasonably desirable to the
other to effect the purposes hereof.
SECTION 8. GENERAL PROVISIONS
Section 8.01 Notices. All notices, demands and requests of any kind to
be delivered to any Party in connection with this Agreement shall be in writing
and shall be deemed to have been duly given if personally delivered or if sent
by internationally recognized overnight courier or by registered or certified
mail, return receipt requested and postage prepaid, addressed as follows:
(a) if to Y2, to:
Y2 Ultra-Filter, Inc.
0000 Xxxx 0xx Xxxxxx
Xxxxxxxx 000
Xxxxx, Xxxxxxx 00000
Attention: Xxx Xxxxxx
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(b) if to USGA, to:
US Global Aerospace, Inc.
0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxx 00000
Telecopier: (000) 000-0000
Attention: Xxxx Xxxxxxxx
or to such other address as the Party to whom notice is to be given may have
furnished to the other Party to this Agreement in writing in accordance with the
provisions of this Section 8.01. Any such notice or communication shall be
deemed to have been received (i) in the case of personal delivery, on the date
of such delivery, (ii) in the case of internationally recognized overnight
courier, on the next business day after the date when sent, and (iii) in the
case of mailing, on the third business day following that on which the piece of
mail containing such communication is posted.
Section 8.02 Entire Agreement. This Agreement shall constitute the
entire agreement between the Parties with respect to the transactions
contemplated hereby and supersedes all prior agreements and understandings
between the Parties relating to such transactions. The exhibits attached hereto
are considered to be a part of this Agreement.
Section 8.03 Headings. The Article, Section and paragraph headings
contained in this Agreement and in any Subagreement are for reference purposes
only and shall not affect, in any way, the meaning or interpretation of this
Agreement or such Subagreement.
Section 8.04 Exhibits. Each exhibit hereto is incorporated herein by
this reference. The Parties may amend any exhibit from time-to-time by entering
into a separate written agreement, signed by an authorized officer of each of
the Parties.
Section 8.05 Interpretation; Separate Counsel. Each Party hereto has
participated in the drafting of this Agreement, and has had the opportunity to
review this Agreement with its separate counsel. Each Party acknowledges this
Agreement is the result of negotiations between the Parties.
Section 8.06 Parties in Interest. This Agreement shall be binding upon
and inure solely to the benefit of each Party hereto and their respective
successors and assigns, and nothing in this Agreement, express or implied, is
intended to or shall confer upon any other person any right, benefit or remedy
of any nature whatsoever under or by reason of this Agreement.
Section 8.07 Amendment. This Agreement may not be modified or amended,
or any of the provisions of this Agreement waived, except by written agreement
of the Parties to this Agreement. Any term of any Subagreement that modifies,
conflicts with or amends any provision of this Agreement shall be effective, and
have precedence over the provisions of this Agreement, only with respect to such
Subagreement, and shall not have any other effect on any other Subagreement
between the Parties.
Section 8.08 Waiver. No waiver by any Party of any default or breach by
another Party of any representation, warranty, covenant or condition contained
in this
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Agreement or any Subagreement shall be deemed to be a waiver of any subsequent
default or breach by such Party of the same or any other representation,
warranty, covenant or condition. No act, delay, omission or course of dealing on
the part of any Party in exercising any right, power or remedy under this
Agreement or any Subagreement or at law or in equity shall operate as a waiver
thereof or otherwise prejudice any of such Party's rights, powers and remedies.
All remedies, whether under this Agreement or any Subagreement or at law or in
equity, shall be cumulative and the election of any one or more remedies shall
not constitute a waiver of the right to pursue other available remedies.
Section 8.09 Assignment. This Agreement shall be binding upon and inure
to the benefit of the Parties and their respective successors and permitted
assigns. Neither Party hereto shall in any way sell, transfer, assign (by
operation of law or otherwise), or otherwise dispose of any of the rights,
privileges, duties and obligations granted or imposed upon it under this
Agreement without the written consent of the other Party, which consent shall
not be unreasonably withheld.
Section 8.10 Severability. In case 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, except in those instances where removal or
elimination of such invalid, illegal, or unenforceable provision or provisions
would result in a failure of consideration under this Agreement, such
invalidity, illegality or unenforceability shall not affect any other provision
hereof, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.
Section 8.11 Independence of Agreements, Covenants, Representations and
Warranties. All agreements and covenants hereunder shall be given independent
effect so that if a certain action or condition constitutes a default under a
certain agreement or covenant, the fact that such action or condition is
permitted by another agreement or covenant shall not affect the occurrence of
such default, unless expressly permitted under an exception to such covenant. In
addition, all representations and warranties hereunder shall be given
independent effect so that if a particular representation or warranty proves to
be incorrect or breached, the fact that another representation or warranty
concerning the same or similar subject matter is correct or is not breached
shall not mitigate such incorrectness or breach.
Section 8.12 Force Majeure. Neither Party shall be liable to the other
for any delay in performance or failure to perform, in whole or in part, due to
labor dispute, strike, war or act of war (whether an actual declaration is made
or not), insurrection, riot, civil commotion, act of public enemy, accident,
fire, flood, or other act of God, act of any governmental authority, judicial
action or similar causes beyond the reasonable control of such Party. In the
event a force majeure occurs, the Party affected by such event shall promptly
notify the other Party of such event and take all reasonable actions to avoid
the effect of such event.
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Section 8.13 Independent Contractor. Y2 and USGA are and shall be
independent contractors to one another, and nothing herein shall be deemed to
cause this Agreement to create an agency, partnership, or joint venture between
the Parties.
Section 8.14 Governing Law; Consent to Jurisdiction. This Agreement
will be governed by and construed in accordance with the laws of Texas without
regard to the laws that may be otherwise applicable under conflicts of laws
principles. Each of the Parties hereby irrevocably and unconditionally submits,
for itself and its property, to the jurisdiction of any Texas state court, or
Federal court of the United States, sitting in Texas, and any appellate court
thereof, in any action or proceeding arising out of or relating to this
Agreement or any Subagreement or the transactions contemplated hereby or thereby
or for recognition or enforcement of any judgment relating thereto. Each of the
Parties hereby irrevocably and unconditionally agrees not to commence any such
action or proceeding except in such courts, agrees that any claim in respect of
any such action or proceeding may be heard and determined in such Texas State
court or, to the extent permitted by law, in such Federal court, and waives, to
the fullest extent it may legally and effectively do so, any objection which it
may now or hereafter have to the laying of venue of any such action or
proceeding in any such Texas State or Federal court, and (d) waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such Texas State or Federal
court. Each of the Parties agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Each Party to this
Agreement irrevocably consents to service of process in the manner provided for
notices in Section 8.01. Nothing in this Agreement will affect the right of any
Party to this Agreement to serve process in any other manner permitted by law.
Section 8.15 Counterparts. This Agreement may be executed in any number
of counterparts and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
agreement. Facsimile counterpart signatures to this Agreement or any
Subagreement shall be acceptable and binding.
[Signature Page Follows]
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The parties, intending to be bound by the terms and conditions
hereof, have caused this Master Agreement to be signed by their duly authorized
representatives on the date first above written.
US GLOBAL AEROSPACE, INC. Y2 Ultra-Filter, Inc.
By: ____________________________ By: _____________________________
Name: Xxxx Xxxxxxxx Name: Xxx Xxxxxx
Title: Chief Executive Officer Title: President
S-1
EXHIBIT A
Y2 PRODUCTS
Y2 Ultra-Filters
A-1
EXHIBIT B
USGA PRODUCTS
G-Xxx(TM)
G-LamC(TM)
B-1
