Binding Letter of Intent

      
      
    
 
Binding
Letter of Intent


Xxxxxxx
Xxxxx
Xxxxxxx
Xxxxxxxx
The
University of Sussex
Regional
Development Office
Science
Park Square
Falmer
Brighton
BN1 9RH (GB)

Dear Xxxx
and Xxxxxxx:
 
This
letter will serve to set forth our mutual agreement with respect to the terms
under which Clean Power Technology, Inc. and its subsidiaries (jointly “CPTI”) agree to enter into a
collaboration agreement with The University of Sussex (“Sussex”) (individually a
“Party” and jointly the
“Parties”) to share and
take further the knowledge gained by Sussex under its HYSTOR project and for
Sussex to assign to CPTI a certain existing patent application International
Publication Number WO 2008/037980 A2 (the “WIPO Application”) to permit
CPTI to proceed with further territorial applications, all as defined
hereinbelow.
 
By
agreeing to this relationship, as of the Effective Date set forth hereinbelow,
CPTI will be responsible for (1) filing and prosecuting, at its sole expense,
territorial applications based upon the WIPO Application in Japan, the United
State, Canada, and the European Union and, (2) the Parties shall collaborate in
good faith to secure funding to further develop the HYSTOR project, as more
fully set forth below.  In furtherance of this Letter of Intent, the
Parties shall enter into a collaborative relationship agreement (“Collaboration Agreement”) and
related agreements and instruments (the “Transaction Documents”) with
the following terms:
 

      
          
            The
      Parties:

            Clean
      Power Technology, Inc. and its subsidiaries and The University of
      Sussex

          

            Mutual
      Exclusivity

            During
      the term of this Agreement and the Collaboration Agreement, Sussex shall
      deal exclusively with CPTI to further develop the HYSTOR project and shall
      assist it to take further the knowledge gained under the HYSTOR project,
      including making its personnel reasonably available to work with
      CPTI.
Neither
      Party shall, for the term of this Agreement, have any other collaborative
      agreement for the HYSTOR project or any prototype or production version of
      the system or product (the “Product”) or aid third
      parties in the manufacture, marketing or sale of Product without the
      express written permission of the other
Party.

          

    
 

        
1

          
        

        
 

      
          
            Patent
      Responsibility

            CPTI
      shall have the exclusive right to and be solely responsible for filing and
      prosecuting, at its sole expense, territorial applications based upon the
      WIPO Application in Japan, the United State, Canada, and the European
      Union (“Territorial
      Applications”).

          

            Patent
      Application Assignment and Assistance

            Sussex
      shall assign the WIPO Application to CPTI for all purposes and shall
      execute such documents and provide such assistance as are reasonably
      required to permit CPTI to file and prosecute the Territorial
      Applications, including, without limitation, the assignment document
      appended hereto and made a part hereof as Exhibit A.

          

            Collaboration
      Under this Letter of Intent

            1.
      The Parties shall share and take further the knowledge gained under the
      HYSTOR project and the knowledge gained as the result of the independent
      work done by CPTI.
2.
      The Parties shall use best efforts to secure additional funding to permit
      the collaboration to go forward (“Collaborative
      Project”).  The Parties agree that a typical model for
      such funding may include Sussex securing a fifty (50%) percent public
      funding grant for a shared project with CPTI or such other entity as it
      may designate providing the additional fifty (50%) percent in cash or in
      kind.  The Parties acknowledge and agree that Sussex does not
      currently have funding to permit it to permit the collaboration to go
      forward.  The Parties further acknowledge and agree that CPTI is
      not required at this time to provide funding for the collaboration to go
      forward. The Parties further agree that inasmuch as funding is not
      currently available and may take time to obtain, neither Party is
      obligated to engage in any collaborative activity, except as set forth in
      Paragraph 1 above, until such funding is available.

          

            Collaboration  Agreement

            The
      Parties shall enter into a Collaboration Agreement which, when executed,
      shall supersede this Binding Letter of Intent.

          

            Ownership
      of Intellectual Property Developed Under Collaboration
      Agreement

            In
      the event that any additional or new intellectual property is produced as
      the result of the Collaboration Agreement (“Collaboration IP”), then
      the Collaboration IP shall be assigned jointly and severally to the
      Parties, or to such entity as either of them may designate. The Parties
      shall jointly determine the exploitation and commercialization of the
      Collaboration IP and shall share in the proceeds therefrom in accordance
      with the percentage of the funding contributed by each Party to the
      development, protection and commercialization of the Collaboration
      IP.

          

    
 
 

        
2

          
        

        
 

      
          
            Collaboration
      Term and Termination

            The
      term of the Collaboration Agreement shall be three (3) years (“Term”).  The
      Collaboration Agreement may be extended for an additional Term by mutual
      consent of the Parties.
In
      the event that no Collaborative Project is commenced during the Term, or
      the Parties mutually agree to terminate the Collaboration Agreement, then
      CPTI shall pay Sussex a fee in the amount of £15,000 for the
      Patent  Application Assignment (“Assignment Fee”) set
      forth above.  CPTI shall receive a credit as against the
      Assignment Fee for all funds expended by CPTI in filing or prosecuting the
      WIPO Application or the Territorial Applications.
In
      the event that a Collaboration Project is commenced within the Term and
      the WIPO Application or any of the Territorial Applications matures into a
      patent and are licensed or otherwise exploited with regard to third
      parties (“Licenses”), then Sussex
      shall receive a royalty equal to 5% of the net profits received from any
      such Licenses.

          

            Miscellaneous

            This
      Letter of Intent shall be governed by the laws of the State of New York,
      without giving effect to the principles of choice of law
      thereof.  The parties each waive any right to trial by jury in
      any action, claim, suit, or proceeding with respect to this
      engagement.  Any dispute involving this Letter of Intent shall
      be resolved pursuant to the commercial dispute resolution rules of the
      American Arbitration Association in New York, New York, before a single
      arbitrator, with each party to bear its own costs and fees, including
      legal fees. In no event shall exemplary, consequential or punitive damages
      be available to either party. This Letter of Intent may not be modified or
      amended except in writing signed by both of the parties
      hereto.  This Letter of Intent supersedes all other agreements,
      understandings, and commitments between the parties, whether written or
      oral.  It is specifically agreed that neither party’s employees,
      agents, or subcontractors shall be deemed employees, associates, agents or
      subcontractors of the other party.  Further, this Agreement does
      not create an agency relationship or evidence a partnership or joint
      venture between CPTI and Sussex.
 
Until
      such time as the parties execute Final Transaction Documents in connection
      with the Sales Relationship, this Letter of Intent shall govern the
      dealings of the parties in connection with the subject matter of this
      Agreement.
 

          

            Confidentiality

            The
      dealings of the Parties in connection with matters involving this Letter
      of Intent shall be maintained in confidence and shall not be disclosed to
      any third party other than those persons who are assisting in the
      preparation of the Transaction Documents, or other consultants and
      advisors to each of the Parties

          

    
 

 
3

          
        
 

 

      
          
            Clean
      Power Technology, Inc.

            By:     Xxxxx Xxxxx           
      
Title:   President
      

          

            The
      University of Sussex

            By:      Xx. Xxx X. Xxxxxx        
Title:  
      Director of Research & Enterprise

          

            Dated:

            March
      13, 2009
Effective
      Date

          

    
 

 
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Document Metadata

Binding Letter of Intent

Document Metadata

Patent Responsibility	CPTI shall have the exclusive right to and be solely responsible for filing and prosecuting, at its sole expense, territorial applications based upon the WIPO Application in Japan, the United State, Canada, and the European Union (“Territorial Applications”).
Patent Application Assignment and Assistance	Sussex shall assign the WIPO Application to CPTI for all purposes and shall execute such documents and provide such assistance as are reasonably required to permit CPTI to file and prosecute the Territorial Applications, including, without limitation, the assignment document appended hereto and made a part hereof as Exhibit A.
Collaboration Under this Letter of Intent	1. The Parties shall share and take further the knowledge gained under the HYSTOR project and the knowledge gained as the result of the independent work done by CPTI. 2. The Parties shall use best efforts to secure additional funding to permit the collaboration to go forward (“Collaborative Project”). The Parties agree that a typical model for such funding may include Sussex securing a fifty (50%) percent public funding grant for a shared project with CPTI or such other entity as it may designate providing the additional fifty (50%) percent in cash or in kind. The Parties acknowledge and agree that Sussex does not currently have funding to permit it to permit the collaboration to go forward. The Parties further acknowledge and agree that CPTI is not required at this time to provide funding for the collaboration to go forward. The Parties further agree that inasmuch as funding is not currently available and may take time to obtain, neither Party is obligated to engage in any collaborative activity, except as set forth in Paragraph 1 above, until such funding is available.
Collaboration Agreement	The Parties shall enter into a Collaboration Agreement which, when executed, shall supersede this Binding Letter of Intent.
Ownership of Intellectual Property Developed Under Collaboration Agreement	In the event that any additional or new intellectual property is produced as the result of the Collaboration Agreement (“Collaboration IP”), then the Collaboration IP shall be assigned jointly and severally to the Parties, or to such entity as either of them may designate. The Parties shall jointly determine the exploitation and commercialization of the Collaboration IP and shall share in the proceeds therefrom in accordance with the percentage of the funding contributed by each Party to the development, protection and commercialization of the Collaboration IP.

Collaboration Term and Termination	The term of the Collaboration Agreement shall be three (3) years (“Term”). The Collaboration Agreement may be extended for an additional Term by mutual consent of the Parties. In the event that no Collaborative Project is commenced during the Term, or the Parties mutually agree to terminate the Collaboration Agreement, then CPTI shall pay Sussex a fee in the amount of £15,000 for the Patent Application Assignment (“Assignment Fee”) set forth above. CPTI shall receive a credit as against the Assignment Fee for all funds expended by CPTI in filing or prosecuting the WIPO Application or the Territorial Applications. In the event that a Collaboration Project is commenced within the Term and the WIPO Application or any of the Territorial Applications matures into a patent and are licensed or otherwise exploited with regard to third parties (“Licenses”), then Sussex shall receive a royalty equal to 5% of the net profits received from any such Licenses.
Miscellaneous	This Letter of Intent shall be governed by the laws of the State of New York, without giving effect to the principles of choice of law thereof. The parties each waive any right to trial by jury in any action, claim, suit, or proceeding with respect to this engagement. Any dispute involving this Letter of Intent shall be resolved pursuant to the commercial dispute resolution rules of the American Arbitration Association in New York, New York, before a single arbitrator, with each party to bear its own costs and fees, including legal fees. In no event shall exemplary, consequential or punitive damages be available to either party. This Letter of Intent may not be modified or amended except in writing signed by both of the parties hereto. This Letter of Intent supersedes all other agreements, understandings, and commitments between the parties, whether written or oral. It is specifically agreed that neither party’s employees, agents, or subcontractors shall be deemed employees, associates, agents or subcontractors of the other party. Further, this Agreement does not create an agency relationship or evidence a partnership or joint venture between CPTI and Sussex. Until such time as the parties execute Final Transaction Documents in connection with the Sales Relationship, this Letter of Intent shall govern the dealings of the parties in connection with the subject matter of this Agreement.
Confidentiality	The dealings of the Parties in connection with matters involving this Letter of Intent shall be maintained in confidence and shall not be disclosed to any third party other than those persons who are assisting in the preparation of the Transaction Documents, or other consultants and advisors to each of the Parties

Clean Power Technology, Inc.	By: Xxxxx Xxxxx Title: President
The University of Sussex	By: Xx. Xxx X. Xxxxxx Title: Director of Research & Enterprise
Dated:	March 13, 2009 Effective Date