LICENSE AND OPTION AGREEMENT
Exhibit
10.2
THIS
AGREEMENT
is made and entered into this 24th
day of June 2008, by and between:
Carbon
Capture Technologies, Inc.
(CCTI
*) (hereinafter referred to as the "LICENSEE") with its principal place of
business at 0000 X. Xxxx Xxxxxx, Xxxxx, Xxxxxxx 00000 , and University of
Ottawa, hereinafter referred to as the "LICENSOR"), and with its principal
place
of operation at 0000-000 Xxxx Xxxxxx Xxxxxx, XXXX, Xxxxxx, Xxxxxxx X0X 0X0
Xxxxxx.
WHEREAS
LICENSOR
is charged with management and licensing of intellectual properties developed
at
University of Ottawa and, under University of Ottawa intellectual property
policy, inventions made by employees of University of Ottawa or made using
the
facilities of University of Ottawa are required to be assigned to University
of
Ottawa and managed by LICENSOR, and
WHEREAS
Dr.
Abdelhhamid Sayari, and Xx. Xxxxx Xxxxxxx ("INVENTORS") have developed novel
adsorbents for the capture of carbon dioxide from a gas stream
("TECHNOLOGY");
WHEREAS
INVENTORS
of the TECHNOLOGY have assigned all intellectual property rights in technology
to
LICENSOR;
WHEREAS
LICENSOR
is the owner of all right, title, and interest in intellectual property,
including, but not limited to, patent, and patent applications, know how
and
improvements set forth in Schedule “A” to this Agreement, and,
WHEREAS
LICENSOR
understands and agrees that LICENSEE plans to be acquired in full within
30 days
by a third party company that is set up to commercialize TECHNOLOGY
WHEREAS
LICENSEE
and
LICENSOR desire to establish a
license
to grant LICENSEE rights to use TECHNOLOGY to make, use and sell products
and
services in the fields of use, as set forth below;
WHEREAS
LICENSOR desires to grant to LICENSEE, and LICENSEE wishes to acquire, an
option
to obtain additional rights to subsequent technology or disclosures described
in
Schedule A and to certain patent rights and know-how of INVENTORS with respect
thereto, subject to the terms and conditions set forth herein, with a view
to
developing and marketing products.
NOW,
THEREFORE,
in
consideration of the promises and the covenants set forth herein, LICENSOR
and
LICENSEE agree as follows:
I. DEFINITIONS
The
following definitions shall apply in the interpretation of this
Agreement.
1.1 “AFFILIATE”
of
any
company means any corporation which, directly or indirectly, controls or
is
controlled by, or is under direct or indirect common control with, such company;
and for the purposes of this definition "control" (including "control by"
and
"under common control with") as used with respect to any corporation or company,
shall mean the possession, directly or indirectly, of the power to direct
or
cause the direction of the management and policies of such corporation or
company, through the ownership of more than 20% of the voting
shares.
1
1.2 “CALENDAR
QUARTER” means
the three-month periods ending March 31, June 30, September 30, or December
31
in any year.
1.3 “LICENSED
INTELLECTUAL PROPERTY” shall mean all the intellectual property and know how in
the FIELD OF USE, including, but not limited to, all patents, patent
application(s), and all continuations, divisions, reexaminations, reissues
and
extensions thereof both foreign and domestic, controlled by LICENSOR,
all
ideas, methods, inventions, characterization and techniques, specialized
knowledge or confidential information, and experience, and improvements
developed by the Inventor which are unpublished/non-disclosed.
1.4 “LICENSED
PRODUCTS” shall mean any product in the FIELD OF USE that incorporates, is
covered by or is made, in whole or part, by the use of the LICENSED INTELLECTUAL
PROPERTY.
1.5 “FIELDS
OF USE” shall
mean all
fields
of use for CO2
adsorbents related to closed circuit breathing systems for health, rescue,
and
recreation, industrial gas streams, and all
confined spaces (buildings, vehicles, aerospace, marine).
1.6 “EFFECTIVE
DATE” shall
mean the date of the Agreement set forth above.
1.7 “LICENSED
TERRITORY”
shall mean worldwide.
1.8 “NET
SALES” shall mean
the amounts received by LICENSEE and its AFFILIATES and SUBLICENSEES from
the
use of LICENSED
PRODUCTS,
or the
sale of LICENSED
PRODUCTS,
less
(i) discounts or rebates actually allowed from the billed amount, (ii) credits
or allowances actually allowed upon claims or returns, and (iii) taxes or
other
government charges included in the amounts billed. For non-cash and partial-cash
sales, NET SALES shall include the fair market value of non-cash consideration
received for such sale of the same quantity of LICENSED
PRODUCTS.
For
sales not at arms-length, NET SALES shall be equal to the fair market price
of
such LICENSED
PRODUCTS
as when
transferred in comparable arms-length transactions. In the event that
LICENSED
PRODUCTS
are used
by LICENSOR rather than sold, the parties shall agree upon an appropriate
NET
SALES price for each such use on which to base a royalty
calculation.
1.9 “SUBLICENSEE”
shall
mean
any non-affiliated third party to whom LICENSEE has granted a Sublicense.
“Sublicense” shall mean an agreement in which LICENSEE (i) grants or otherwise
transfers any of the rights licensed to LICENSEE hereunder or other rights
that
are relevant to designing, developing, testing, making, using, or selling
of
LICENSED
PRODUCTS,
(ii)
agrees not to assert such rights or to xxx, prevent or seek a legal remedy
for
the practice of same, (iii) assigns or otherwise transfers this Agreement
and/or
the rights acquired by it, or (iv) is under an obligation to grant, assign
or
transfer any such rights or non-assertion, or to forebear from granting or
transferring such rights to any other entity, including licenses, option
agreements, right of first refusal agreements, or other agreements.
1.10 “SUBLICENSING
REVENUE”
shall mean the fair market cash value of any and all consideration received
by
LICENSOR from SUBLICENSEE under its sublicense, including without limitation
license issue fees and other licensing fees, option fees, milestone payments,
minimum annual royalties, equity or other payments of any kind whatsoever
(but
excluding running royalties paid for NET SALES of LICENSED
PRODUCTS
by
SUBLICENSEE), irrespective of whether such revenues are received in the form
of
cash, barter, credit, stock, warrants, release from debt, goods or services,
licenses back, or any other form whatever.
2
II.
GRANT
2.1 LICENSOR
grants to
LICENSEE an exclusive, royalty bearing license, extending to all of LICENSED
TERRITORY, under LICENSED INTELLECTUAL PROPERTY to make, use, offer to sell,
sell, and import LICENSED PRODUCTS throughout the term hereof in the FIELD
OF
USE. This grant shall be subject to the payment by LICENSEE to LICENSOR of
all
consideration as provided in this Agreement, and shall be further subject
to the
rights retained by LICENSOR to:
a. Publish
the scientific findings from current or new research related to LICENSED
INTELLECTUAL PROPERTY; and
b. To
practice under the
LICENSED
INTELLECTUAL PROPERTY
for
educational, research and other non-commercial internal purposes. Such
reservation shall include the right to extend such right to practice under
the
LICENSED
INTELLECTUAL PROPERTY
for
educational and research purposes (but not any other non-commercial internal
purpose) to subsequent employers of any of the Inventors, but only to the
extent
that such employers are research or educational institutions. Such reservation
shall further include the right to provide technical information, and to
grant
licenses under the LICENSED
INTELLECTUAL PROPERTY,
to
not-for-profit and governmental institutions for their internal research
and
scholarly use only.
2.2 LICENSEE
shall have the
right to seek sublicenses subject to the terms and conditions of this agreement
and as defined in Section VIII. LICENSEE will attach and incorporate by
reference the provisions of this Agreement pertaining to payment obligations,
patent applications, warranties, reporting requirements, and confidentiality,
to
any sub-license agreements entered into by LICENSEE. LICENSEE will provide
LICENSOR with copies of the sub-license agreements evidencing a third party
or
SUBLICENSEE’S commitment to be bound by the terms and conditions of this
Agreement and with sections pertaining to NET SALES prior to the execution
of
any sublicense agreement.
2.3 This
Agreement shall terminate on the later of 17 years from the EFFECTIVE DATE,
or
the date of the last of the LICENSED INTELLECTUAL PROPERTY to expire or to
become publicly available, or by the terms specified in this
Agreement.
2.4 LICENSOR
hereby grants to LICENSEE an option to obtain one or more exclusive, worldwide,
royalty bearing licenses, under all or part of the LICENSOR Patent Rights
(to
the extent not exclusively licensed to LICENSEE in section 2.1) to make,
to have
made, to use, to sell, to import, to export and to have sold products related
to
subsequent technology or disclosures described in Schedule A and to certain
patent rights and know-how of INVENTORS other than CO2
adsorbents related to health care and industrial gas streams
and a
non-exclusive right to use the associated LICENSOR Technology in or outside
the
Field, with the right to sublicense. The period of time that LICENSEE may
exercise said option shall begin on the Effective Date of this Agreement
and
shall expire 24 months following the Effective Date of this Agreement, or 60
days prior to the expiration of priority years related to provisional or
regular
patent filings, whichever occurs first, (the "Option Period"). Upon receipt
by
LICENSOR of LICENSEE' written notice of its exercise of this option during
the
Option Period, the terms and conditions for such licensees) shall be negotiated
in good faith during the following 90 days after exercise of the Option by
the
parties, such terms and conditions being typical for a license agreement
between
a university-licensor and an industry-licensee and consistent with LICENSOR's
objective of having its technology productively used within a commercially
reasonable time period and LICENSEE’s ability to productively use (or license
for productive use) within a commercially reasonable time period; such terms
and
conditions shall include, for example, commercially reasonable terms and
conditions for minimum annual royalties, dates by which various stages of
commercial development are to have occurred, and a specification of the field
in
which the license is to be granted. All the option rights which LICENSEE
has
under this paragraph shall terminate on the anniversary date of the Effective
Date of this Agreement unless included in the contemplated license signed
by the
first anniversary date or by a new extended date which is mutually agreed
to and
is either 30 days or 60 days from the anniversary date.
3
III.
PAYMENT PROVISIONS
3.1 LICENSEE
agrees to pay
LICENSOR a noncreditable, nonrefundable fee of $60,000 (the “License Fee”)due
upon execution of the Agreement and, provided that the LICENSEE is not in
default of this Agreement, such License Fee may be payable according to the
appended payment schedule set forth in "Schedule B", provided that LICENSEE
is
not in default of the agreement.
3.2 Licensee
agrees to pay
LICENSOR for all documented patent prosecution costs for LICENSED INTELLECTUAL
PROPERTY within 30 days of invoicing.
3.3 LICENSEE
agrees to pay to
LICENSOR a running royalty of 3.0% based on the NET SALES of the LICENSED
PRODUCTS by LICENSEE, AFILLIATES.
3.4 LICENSEE
shall pay
minimum annual royalties according to the following schedule:
|
Year
|
Minimum
Royalty Payment
|
|
1st
|
$
0
|
|
2nd
|
$
10,000
|
|
3rd
|
$
25,000
|
|
4th
|
$
50,000
|
|
5th
&
each year thereafter until the end of the license term
|
$
100,000
|
Minimum
annual royalties are fully creditable against earned royalties paid during
the
previous twelve-month period.
3.5 LICENSEE
shall pay LICENSOR 50% of all sublicense revenues (royalties, upfront fees,
milestones, etc.) as described in Section 1.10, received from sublicensees.
The
sublicense royalties are not to fall below 1.5% (50% of 3%) of net sales
that
incorporate the licensed technology.
3.6 In
the
case of a buyout or other change in majority ownership of LICENSEE, or a
buyout
of LICENSED PRODUCTS, all payment provisions are passed through, non-negotiable,
and remain in effect for LICENSEE, sub-LICENSEE, or purchaser. LICENSEE shall
inform any potential purchaser of this clause and present evidence to
LICENSOR.
3.7 If
LICENSED INTELLECTUAL
PROPERTY is not accepted as eligible or invalidated by a court of law or
a
countries patent office, LICENSEE shall pay only amounts accrued up until
the
date of such determination of invalidity.
4
IV.
DILIGENCE AND PATENT PROSECUTION
4.1 LICENSEE
agrees to use
all reasonable efforts and diligence to proceed with the development,
manufacture, and sale or lease of LICENSED PRODUCTS and to diligently develop
markets for the LICENSED PRODUCTS. LICENSEE also agrees to pursue with
reasonable effort and diligence and is responsible for any future technological
developments and potential applications for patents arising out of LICENSED
INTELLECTUAL PROPERTY.
4.2 LICENSOR
agrees to
provide reasonable limited assistance to the LICENSEE in order to ensure
an
efficient transfer and implementation of the technology. LICENSEE may seek
to
retain the services of LICENSOR under separate contracts to assist in the
technological developments and patent applications. LICENSEE may also retain
services from members of the research team in separate personal services
agreements subject to contractual obligations to their primary employer and
/ or
the LICENSOR.
4.3 LICENSOR
shall retain
ownership of any future technological developments it funds, and of any patent
and patent applications arising out of LICENSED INTELLECTUAL PROPERTY. In
such
event the development is funded and pursued jointly, LICENSOR and LICENSEE
may
jointly pursue ownership.
4.4 LICENSEE
shall be
responsible for the cost of prosecution and maintenance of patents and
copyrights during the term of this Agreement, subject to the limitations
of
paragraph 4.6. The LICENSEE and LICENSOR shall jointly select and retain
patent
counsel to prosecute and maintain patents and copyrights during the term
of this
agreement.. LICENSOR shall fully cooperate and assist LICENSEE in all related
matters.
4.5 All
patents, patent
applications, and copyrights on the LICENSED INTELLECTUAL PROPERTY shall
be,
assigned to LICENSOR, and LICENSOR's interest therein shall be recorded in
the
Canadian and U.S. Patent and Trademark Offices and appropriate corresponding
foreign patent offices.
4.6 LICENSOR
shall maintain
direct authority to instruct retained patent agent in the prosecution of
any
patent or patent application arising out of the LICENSED INTELLECTUAL PROPERTY.
LICENSOR will copy LICENSEE on all correspondence directing the retained
patent
agent relating to the LICENSED INTELLECTUAL PROPERTY using the same method
of
communication as used to direct the patent agent. LICENSEE shall not be
responsible for patent costs incurred in response to instructions provided
by
LICENSOR to the patent agent after LICENSEE has provided a written notification
to the patent agent and LICENSOR that it is not willing to incur the patent
related expenses to be incurred in response to the instructions. LICENSEE
remains responsible for costs incurred relating to the LICENSED INTELLECTUAL
PROPERTY normally incurred as a matter of normal procedural activities carried
out by the retained patent counsel, that are not a direct result of specific
instructions provided by LICENSOR.
4.7 LICENSOR
shall provide
LICENSEE with copies of all papers received from and to be filed in the Canadian
and U.S. Patent and Trademark Offices, and appropriate corresponding foreign
patent and copyright offices.
4.8 LICENSEE
shall be
entitled, in its discretion, to abandon any application or granted patent
or
copyright if it considers that the ongoing costs of the same are not justified,
provided that LICENSEE notifies LICENSOR prior to such abandonment and allows
LICENSOR opportunity to avoid such abandonment. In no event shall such
reasonable opportunity be less than three (3) months prior to abandonment.
If
LICENSEE chooses to abandon an application or granted patent or copyright
under
this provision and LICENSOR, at its sole expense, continues pursuing the
application, granted patent or copyright, LICENSEE shall retain no right
to
exclusively use or exclusively exploit the LICENSED INTELLECTUAL PROPERTY
or any
related copyright in the country, territory or jurisdiction which granted
the
patent or copyright.
5
V.
REPORTING OBLIGATIONS
5.1 LICENSEE,
within sixty
(60) days after each CALENDAR QUARTER of each year, shall deliver
to
LICENSOR
true and accurate reports, pertaining to NET SALES of LICENSED PRODUCTS,
which
shall include at least the following information:
a)
The
identity of each LICENSED PRODUCTS being developed, manufactured, marketed
and/or sold;
b)
The
stage of development of each LICENSED PRODUCTS in each country in the LICENSED
TERRITORY;
c)
The
number of each LICENSED PRODUCTS manufactured and/or sold in each country
in the
LICENSED TERRITORY;
d)
NET
SALES of LICENSED PRODUCTS sold by the LICENSEE and all SUBLICENSEES, prepared
in accordance with generally accepted accounting principles, on a country
by
country basis, for each LICENSED PRODUCTS;
e)
Any
and all deductions from NET SALES made by LICENSEE;
f)
Names
and addresses of all SUBLICENSEES of LICENSEE;
g)
Total
royalties due.
5.2 Progress
Report. On or
before December 1 of each year until LICENSEE markets LICENSED PRODUCTS,
LICENSEE shall make a written annual report to LICENSOR covering the preceding
year, regarding the progress of LICENSEE toward commercial use of LICENSED
PRODUCTS. Such report shall include, as a minimum, information sufficient
to
enable LICENSOR to ascertain progress by LICENSEE toward meeting the diligence
requirements of Section 4.1.
5.3 With
each report
submitted under Section 5.1 of this Agreement, LICENSEE shall make all payments
to LICENSOR in US dollars due and payable under Section 3 of this Agreement.
If
no royalties are due, LICENSEE shall so report.
5.4 LICENSEE
shall be
obligated to pay royalties on all LICENSED PRODUCTS that are either sold
or
produced under this license. LICENSEE also agrees to make a written report
to
LICENSOR within 90 days after the termination of the license pursuant to
Section
VII. LICENSEE shall continue to make reports concerning royalties on the
sale of
LICENSED PRODUCTS payable in accordance with Section III after termination
of
the license, until such time as all such LICENSED PRODUCTS produced under
the
license have been sold or destroyed. Concurrent with the submittal of each
post-termination report, LICENSEE shall pay LICENSOR all applicable royalties.
5.5 LICENSEE
shall keep full,
true and accurate books of account containing all particulars that may be
necessary for the purpose of showing the amounts payable to LICENSOR hereunder.
Said books of account shall be kept at LICENSEE's principal place of business.
Said books and supporting data shall be open at all reasonable times for
5 years
following the end of the calendar year to which they pertain, to the inspection
of LICENSOR or its agents for the purpose of verifying LICENSEE's royalty
statement or compliance in other respects with this Agreement. Said records
will
include general ledger records showing cash receipts and expenses, and records
which include production records, customers, serial numbers, and related
information in sufficient detail to enable the royalties payable hereunder
by
LICENSEE to be determined. Such examination is to be made by LICENSOR or
its
designee, at the expense of LICENSOR. Should such inspection, however, lead
to
the discovery of a greater than five percent (5%) discrepancy in reporting
to
LICENSOR's detriment, LICENSEE shall pay the full cost of such inspection.
LICENSEE shall pay any amounts such inspection reveals to be due and owing
within thirty (30) days of the receipt of an invoice for it.
6
VI.
INFRINGEMENT
6.1 LICENSEE
acknowledges and agrees that all rights licensed by the
LICENSOR
hereunder are licensed “as is” and without any representation, indemnification
or warranty with respect to possible infringement of third party rights.
In the
event of a third party infringement action against either party with respect
to
any LICENSED INTELLECTUAL PROPERTY, LICENSEE will defend LICENSOR at LICENSEE’s
expense, with the understanding that breaching such obligation may result
in a
default judgment against LICENSEE, its Affiliates, Sublicensees, and/or LICENSOR
(however, LICENSEE’s failure to defend shall not prevent LICENSOR from defending
itself). LICENSEE shall indemnify, defend and hold LICENSOR
harmless
from any such judgment, and without limitation shall pay any damages awarded
in
any judgment against LICENSOR. LICENSOR will cooperate as requested by LICENSEE,
and will be compensated by LICENSEE for its reasonable out-of-pocket expenses
incurred in such cooperation, which LICENSOR
will
only
be required to expend if LICENSEE has approved same for reimbursement. No
settlement, consent judgment, or other voluntary final disposition of any
suit
that would affect the validity, scope or enforceability of the LICENSED
INTELLECTUAL PROPERTY, by estoppel, admission or otherwise, or the
LICENSOR’
rights
in or to same, may be entered into without the consent of LICENSOR.
6.2 LICENSEE
and LICENSOR shall promptly inform each other in writing of any alleged
infringement of the LICENSED
INTELLECTUAL PROPERTY
by a
third party.
6.3 During
the term of this agreement, LICENSOR will have the right, but shall not be
obligated, to prosecute at its own expense all infringements of the LICENSED
INTELLECTUAL PROPERTY
and, in
furtherance of such right, LICENSOR will include LICENSEE, upon agreement
by
LICENSEE, as a party plaintiff in any such suit, at LICENSEE’S expense. Each
party shall bear its own costs of prosecuting any such infringement action,
shall be entitled to prove and recover any damages, and distribution shall
be
governed by Section 6.4. Upon mutual agreement of the parties, each may assign
to the other its right to xxx for past, present, or future infringement of
the
LICENSED
INTELLECTUAL PROPERTY,
and to
agree to a method to allocate damages recovered by the assignee of such
rights.
6.4 LICENSOR
or LICENSEE
shall have three (3) months after having been notified of any alleged
infringement to investigate whether infringement can be established. If LICENSOR
determines that infringement exits, then it shall have three (3) months to
negotiate in good faith with the alleged infringer to resolve the dispute.
At
the end of such period, if the dispute has not been resolved, LICENSOR shall
have forty-five (45) days to commence prosecuting an infringement action
(the
filing period). If LICENSOR determines that infringement can be established
and
(a) at any time decides not to pursue an action against the alleged infringer,
or (b) fails to commence prosecuting an action before the end of the filing
period, then LICENSOR shall notify LICENSEE of its intention not to bring
suit
against any alleged infringer in the LICENSED TERRITORY. In those events
only,
LICENSEE shall have the right but shall not be
obligated, to prosecute at its own expense any infringement of the LICENSED
INTELLECTUAL PROPERTY,
and
LICENSOR hereby agrees at its discretion and upon terms to be mutually agreed
by
the parties, to either be named as a plaintiff in any such proceedings or
to
assign its rights to xxx for infringement. LICENSEE shall pay all of LICENSOR’S
costs and reasonable attorney fees incurred in such action. No settlement,
consent judgment, or other voluntary final disposition of the suit shall
be
entered into without the consent of LICENSOR, which consent shall not be
unreasonably withheld. LICENSEE hereby indemnifies LICENSOR against any order
for costs or attorney fees that may be made against LICENSOR in such proceedings
instituted by LICENSEE.
7
6.5 In
the event that
LICENSOR shall undertake the enforcement and/or defense of the LICENSED
INTELLECTUAL PROPERTY
by
litigation, any monetary recovery by LICENSOR, shall be divided equally between
LICENSOR and LICENSEE, after recovering of attorneys and court costs. In
the
event that LICENSEE undertakes the enforcement and/or defense of the
LICENSED
INTELLECTUAL PROPERTY
by
litigation, any monetary recovery by LICENSEE shall be shared equally with
LICENSOR, after recovering of attorneys and court costs.
6.6 In
any infringement suit
that either party may institute to enforce the LICENSED
INTELLECTUAL PROPERTY
pursuant
to this Agreement, the other party hereto shall, at the request of the party
initiating such suit and upon reasonable notice, cooperate in all respects
and,
to the extent possible, have its employees testify when requested and make
available relevant records, papers, information samples, models, specimens
and
the like.
6.7 LICENSEE,
during the
exclusive period of this Agreement, shall have the sole right, subject to
approval by LICENSOR, which shall not be unreasonably withheld, in accordance,
with the terms and conditions herein to sublicense any alleged infringer
in the
LICENSED TERRITORY for future use of LICENSED
INTELLECTUAL PROPERTY.
Prior
to the distribution of sublicensing fees received from an alleged infringer
as
specified in Section III, LICENSOR shall be compensated for any and all expenses
incurred by it, if any, in that regard prior to the commencement of the
sublicense with the infringer.
6.8 In
the event of any legal
action alleging invalidity or noninfringement of any of the LICENSED
INTELLECTUAL PROPERTY
shall be
brought against LICENSEE, or LICENSOR, LICENSOR, at its option, shall have
the
right within thirty (30) days after the commencement of such action, to join
with LICENSEE or initiate defense of the action at its own expense. If LICENSOR
chooses not to intervene, LICENSEE shall have the option to intervene and
take
over the sole defense at its own expense.
VII.
TERMINATION
7.1 The
provisions of this
Agreement, having come into force on the Effective Date, shall, unless
terminated earlier for any reason, continue in force in accordance with their
respective terms as indicated in Section 2.3.
7.2 LICENSEE
may terminate
this Agreement at any time by giving LICENSOR ninety (90) days written notice.
In the event of termination of this Agreement by LICENSEE, LICENSEE shall
have
no further rights under this Agreement; however, LICENSEE will remain obligated
for the License Fee, any royalties due, or other expenses incurred up until
the
date of termination including royalty on sale of inventory in stock after
the
date of termination.
7.3 LICENSOR
may terminate
this Agreement if LICENSEE:
| a. |
Fails
to pay on the due date any sum due under Section 3 of this Agreement
and
fails to correct such default within ninety (90) days after receipt
of
written notice of default by
LICENSOR;
|
| b. |
Fails
to provide reports on the due date specified under Section 5 of
this
Agreement or fails to satisfy the reasonable effort and diligence
requirement as specified in Section 4.1 and fails to correct such
default
within ninety (90) days after receipt of written notice of default
by
LICENSOR;
|
8
| c. |
Files
for bankruptcy protection in any jurisdiction in which it has operations,
makes any proposal for the benefit of its creditors generally,
makes any
filing for protection from creditors or to allow for restructuring
or
reorganization or ceases to actively carry on
business.
|
7.4
Notwithstanding the above, this Agreement and the licenses granted herein
shall
immediately and automatically terminate without notice in the event LICENSEE,
or
its AFFILIATES, SUBLICENSEES or other party acting under authority of LICENSEE,
violates any provision of the Indemnification and Insurance articles. A
termination occurring under this paragraph shall occur and become effective
at
the time of the violation that causes such termination, and LICENSEE and
its
Affiliates and Sublicensees shall have no right to continue clinical trials
or
complete production and sale of LICENSED PRODUCTS. Notwithstanding the
foregoing, to the extent that such rights are still available for licensing,
LICENSOR shall have the right to reinstate the effectiveness of this Agreement
by obtaining the required insurance, whereupon this Agreement shall
automatically become effective as of the date of reinstatement of said
insurance, and shall remain in full force and effect without any further
action
of the parties hereto until termination or expiration of this Agreement
according to its terms.
7.5 Either
party may
forthwith terminate this Agreement by written notice to the other
if:
| a. |
Anything
analogous to any of the foregoing under the law of any jurisdiction
occurs
in relation
to that other party; or
|
| b. |
If
the other party ceases, or threatens to cease, to carry on
business.
|
7.6 Upon
termination or
expiration of this agreement, for any reason, Licensee shall
immediately:
| a. |
Pay
any outstanding portion of the License Fee;
|
| b. |
Pay
royalties accrued or accruable to the date of termination or
expiration;
|
7.6.5
Further,
notwithstanding the termination or expiration of this Agreement by either
party
for any reason, the following provisions shall continue in full force and
effect
after said termination or expiration:
| a. |
Any
cause of action or claim of LICENSEE or LICENSOR, accrued or to
accrue,
because of any breach or default by the other party shall survive
termination or expiration; and
|
| b. |
The
provisions of Sections V, and Paragraphs 9.6, and 9.8, and any
other
provisions that by their nature are intended to survive after termination
or expiration.
|
7.7 If
LICENSOR terminates
the Agreement, LICENSEE shall have no claim to the use of the LICENSED
INTELLECTUAL PROPERTY.
7.7 No
relaxation,
forbearance, delay or indulgence by either party in enforcing any of the
terms
of this Agreement or the granting of time by either party to the other shall
prejudice, affect or restrict the rights and powers of the former hereunder
nor
shall any waiver by either party of a breach of this Agreement be considered
as
a waiver of any subsequent breach of the same or any other provision
hereof.
7.8 The
rights to terminate
this Agreement given by this clause shall not prejudice any other right or
remedy of either party in respect of the breach concerned (if any) or any
other
breach.
9
VIII.
SUBLICENSE(S)
8.1 If
LICENSEE is unable or
unwilling to serve or develop a potential market or market territory for
which
there is a willing SUBLICENSEE(s), LICENSEE will, upon LICENSOR's approval,
negotiate in good faith a sublicense(s) hereunder.
8.2 Any
sublicense(s) granted by LICENSEE under this Agreement shall be subject and
subordinate to terms and conditions of this Agreement, except:
| a. |
Sublicense
terms and conditions shall reflect that any SUBLICENSEE(s) shall
not
further sublicense; and
|
| b. |
The
earned royalty rate specified in the sublicense(s) may be at higher
rates
than the rates in this Agreement.
|
8.3 Any
such
sublicense(s) also shall expressly include the provisions pertaining to payment
obligations, patent applications, warranties, reporting requirements, and
confidentiality, for the benefit of LICENSOR and provide for the transfer
of all
obligations, including the payment of royalties specified in such sublicense(s),
to LICENSOR or its designee, in the event that this Agreement is
terminated.
8.4 LICENSEE
agrees to provide LICENSOR a copy of any sublicense granted pursuant to Section
VIII.
IX.
MISCELLANEOUS
9.1 Nothing
in this Agreement
shall create, or be deemed to create, a partnership, or the relationship
of
principal and agent, between the parties.
9.2 Notice
of Bankruptcy.
LICENSEE must provide notice to LICENSOR of its intention to file a voluntary
petition in bankruptcy, or of another's intention to file an involuntary
petition in bankruptcy, said notice to be received by LICENSOR at least sixty
(60) days prior to the filing of such a petition. A party's filing without
conforming to this requirement shall be deemed a material, pre-petition
incurable breach.
9.3 Assignment.
With the
exception of this transaction, and the planned acquisition of the LICENSEE,
so
long as LICENSEE is not in breach of this Agreement in any respect, LICENSEE
may
assign or otherwise transfer this Agreement and/or the rights acquired by
it
hereunder upon obtaining consent from the LICENSOR for the same (such consent
will not be unreasonably withheld), to the extent that such assignment or
transfer is accompanied by a sale or other transfer of LICENSEE’S entire
business, regardless of whether such transfer is in the form of a sale of
the
LICENSEE’S assets, a sale of the majority shares of LICENSEE’S Equity, a merger,
an equity exchange, or other form of transfer. LICENSEE shall give the LICENSOR
written notice of LICENSEE’S intent to assign or transfer this Agreement thirty
(30) days prior to completion of such assignment or transfer, along with
a copy
of such assignment agreement, pursuant to which such assignee or transferee
shall have agreed in writing to be bound by the terms and conditions of this
Agreement. Upon completion of such assignment or transfer, LICENSEE shall
immediately provide the LICENSOR with payment of any License Fee payments
outstanding according to the Payment Schedule listed in Appendix B, and
thereafter the term “LICENSEE” as used herein shall include such assignee or
transferee. If LICENSEE shall sell or otherwise transfer its entire
business, and the transferee shall not have agreed in writing to be bound
by the
terms and conditions of this Agreement, or the Agreement and/or the rights
acquired by it hereunder upon obtaining consent from the LICENSOR and such
transferee do not agree upon new licensing terms and conditions, within sixty
(60) days of such sale or transfer, the LICENSOR shall have the right to
terminate this Agreement.
10
9.4 Subject
to Section 9.3 of
this Agreement, the clauses are personal to the parties and neither party
may
assign, mortgage, charge or license any of its rights hereunder, nor may
either
party sub-contract or otherwise delegate any of its obligations hereunder,
except with the prior written consent of the other party.
9.5 LICENSEE
shall (i) to the
extent reasonably practical, place in a conspicuous location on all patented
PRODUCTS made pursuant to this Agreement a patent notice in accordance with
35
U.S. C. §287 consisting of the word "Patent" or "Patents" and the number or
numbers of the United States patent or patents licensed hereunder and (ii)
comply in all respects with the laws of the country of manufacture, and/or
sale
of the LICENSED INTELLECTUAL PROPERTY with respect to marking such PRODUCTS
so
as to ensure LICENSOR of full protection and rights under such laws. LICENSEE
shall include the provisions of this clause in all sub-licenses with third
parties and Affiliates.
9.6 LICENSEE
shall at all
times during the term of this Agreement and thereafter indemnify, defend
and
hold LICENSOR, its trustees, directors, officers, employees and affiliates
harmless against all claims, proceedings, demands and liabilities, including
legal expenses arising out of the death of or injury to any person or persons
or
out of any damages to property resulting from the research, development,
production, manufacture, sale, modification, use, import or advertisement
of
LICENSED PRODUCTS or arising from any obligation of LICENSEE
hereunder.
9.7 In
the event that
LICENSEE or a sub-LICENSEE of LICENSEE conducts studies involving human subjects
and LICENSED INTELLECTUAL PROPERTY, and upon commencement of commercial sales
of
LICENSED PRODUCTS, LICENSEE shall obtain and carry in full force and effect
commercial, general liability insurance which shall protect LICENSEE and
LICENSOR with respect to events set forth above. Such insurance shall be
written
by a reputable company authorized to due business in the United States, shall
list LICENSOR as an additional named insured thereunder, shall be endorsed
to
include PRODUCTS liability coverage and shall require reasonable written
notice
to be given to LICENSOR prior to any cancellation or material change thereof.
The limits of such insurance shall not be less than one million dollars
($1,000,000) US per occurrence with an aggregate of three million dollars
($3,000,000) US for personal injury or death, and one million dollars
($1,000,000) US per occurrence with aggregate of three million dollars
($3,000,000) US for property damage. LICENSEE shall provide LICENSOR with
Certificates of Insurance evidencing same.
9.8 Disclaimers.
Nothing in
this Agreement shall be construed as (i) a warranty or representation by
the
LICENSOR
as to
the validity or scope of any LICENSED INTELLECTUAL PROPERTY, (ii) a warranty
or
representation that anything made, used, imported, developed, promoted, offered
for sale, sold, or otherwise disposed of under any license granted in this
Agreement does not or will not infringe patents, trade secrets or other
proprietary rights of third parties; (iii) an obligation to bring or prosecute
actions or suits against third parties for infringement; (iv) conferring
the
right to use in advertising, publicity or otherwise any trademark, trade
name,
or names, or any contraction, abbreviation, simulation or adaptation thereof
of
LICENSOR; (v) conferring by implication, estoppel or otherwise any license
or
rights under any patents of LICENSOR other than the LICENSED INTELLECTUAL
PROPERTY; (vi) any other representations or warranties, either express or
implied, unless specified in this Agreement. LICENSOR DISCLAIMS AND MAKES
NO
EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE WITH RESPECT TO THE LICENSED RIGHTS, OR ANY LICENSED
PRODUCTS.
11
9.9 For
the purposes of this
Agreement "Force Majeure” means any circumstances beyond the reasonable control
of either party including, without limitation, any strike, lock-out, or other
form of industrial action. If either party is affected by Force Majeure,
it
shall forthwith notify the other party of the nature and extent thereof.
Neither
party shall be deemed to be in breach of this Agreement, or otherwise be
liable
to the other, by reason of any delay in performance, or the non-performance,
of
any of its obligations under this Agreement, to the extent that such delay
or
non-performance is due to any Force Majeure of which it has notified the
other
party, and the time for performance of that obligation shall be extended
accordingly. If the Force Majeure in question prevails for a continuous period
in excess of six (6) months, the parties shall enter into bona fide discussions
with a view to alleviating its effects, or to agreeing upon such alternative
arrangements as may be fair and reasonable.
9.10 LICENSEE
shall not use
the names or trademarks of LICENSOR, nor any adaptation thereof, nor the
names
of any of its employees, in any advertising, promotional or sales literature
without prior written consent obtained from LICENSOR, in each case, except
that
the LICENSEE may state that it is a LICENSEE of LICENSOR with respect to
the
LICENSED INTELLECTUAL PROPERTY and it may cite published scientific literature
by employees of LICENSOR that pertains to the LICENSED INTELLECTUAL
PROPERTY.
9.11 All
Notices shall be made
in writing to the individuals and addresses noted below, and shall be sent
by
certified mail, returned receipt requested. If the individual to whom notices
are to be given, or address where notices are to be sent changes for any
party,
that party shall promptly notify the other party accordingly.
Attention:
Xxxx Xxxxxxx
President
Carbon
Capture Technologies, Inc.
0000
X.
Xxxx Xxxxxx
Xxxxx,
Xxxxxxx 00000
Attention:
D. Xxxxxx Xxxxxx
Director
Office
of
Technology Transfer & Business Enterprise
University
of Ottawa
000
Xxxx
Xxxxxx Xxxxxx (3042), SITE
Xxxxxx,
Xxxxxxx X0X 0X0 Xxxxxx
9.12 This
Agreement contains
the entire and only agreement and understanding between the parties and
supersedes all preexisting agreements between them respecting its subject
matter. Any representation, promises, or condition in connection with such
subject matter that is not incorporated in this Agreement shall not be binding
on either party. No modification, renewal, waiver, and no termination of
this
Agreement or any of its provisions shall be binding upon the party against
whom
enforcement of such modification, renewal, waiver or termination is sought,
unless made in writing and signed on behalf of such party by one of its duly
authorized officers. As used herein, the word "termination" includes any
and all
means of bringing an end prior to its expiration by its own terms of this
Agreement, or any provisions thereof, whether by release, discharge, abandonment
or otherwise.
12
9.13 This
Agreement shall be
construed, governed, interpreted and applied in accordance with the laws
of the
Province of Ontario and Canada as applicable, except that questions affecting
the construction and effect of any patent shall be determined by the law
of the
country in which the patent was granted. Any legal action or proceeding relating
to this Agreement or any document or instrument related hereto shall be brought
only in the courts of the Ontario, Canada, and by its execution and delivery
of
this Agreement, LICENSOR hereby accepts for itself and in respect to its
property, generally and unconditionally, the jurisdiction of the aforesaid
courts.
9.14 This
Agreement may be
executed in one or more counterparts and any party hereto may execute any
such
counterparts each of which shall be deemed an original and all of which,
taken
together, shall constitute but one and the same document. It shall not be
necessary in making proof of this document or any counterpart hereof to produce
or account for any of the other counterparts.
9.15 Time
shall always be of
the essence.
9.16 The
provisions of this
Agreement are severable, and in the event that any provisions of this Agreement
shall be determined to be invalid or unenforceable under any controlling
body of
the law, such invalidity and unenforceability shall not in any way affect
the
validity or enforceability of the remaining provisions hereof. In the event
the
validity or unenforceability of any provision of this Agreement is brought
into
question because of the decision of a court of competent jurisdiction, LICENSOR,
by written notice to LICENSEE may revise the provision in question or may
delete
it entirely so as to comply with the decision of said court.
9.17 The
failure of either
party to assert a right hereunder or to insist upon compliance with any term
or
condition of this Agreement shall not constitute a waiver of that right or
excuse a similar failure to perform any such term or condition by the other
party.
9.18 All
reports and documents
to be forwarded to LICENSOR shall be in the English Language.
9.19 All
payments required
under this Agreement shall be made in U.S. Dollars. LICENSEE agrees to pay
interest of 1.5% per month, the interest being compounded monthly, or two
hundred fifty dollars ($250.00), whichever is greater, on any delinquent
payments to LICENSOR. LICENSEE shall calculate the correct late payment charge,
and shall add it to each such late payment. LICENSEE shall pay for all costs
and
reasonable attorneys fees incurred by LICENSOR in collecting payments due
to
LICENSOR.
13
IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed in
duplicate as first above written.
AGREED
AND ACCEPTED:
CARBON
CAPTURE TECHNOLOGIES INC.:
|
By:
|
 |
Date:
June 24, 0000
|
XXXXXXXXXX
XX XXXXXX
|
By:
|
/s/ D. Xxx Xxxxxx |
Date:
June 25, 2008
|
14
Schedule
“A”
Patents
and Patent Applications
| · |
WO2006094411
& WO0000000000; Inventors: Xxxxxxxxxx Xxxxxx, Ph.D. and Xxxxx Xxxxxxx,
Ph.D.; titled “FUNCTIONALIZED ADSORBENT FOR REMOVAL OF ACID GASES AND USE
THEREOF” and “AMINE MODIFIED ADSORBENT, ITS PREPARATION AND USE FOR DRY
SCRUBBING OF ACID GASES”
|
| · |
Know-how
owned by LICENSOR
necessary to assist in bringing the technology to market in areas
where
patent coverage does not exist.
|
| · |
Intellectual
property related to the high pressure use of mesoporous materials
such as
MCM 41, as outlined in the draft paper entitled "Insights
into the adsorption of dry CO2 on MCM-41 silica at room
temperature"
|
.
Schedule
"B"
Payment
Schedule for License fee
1.
$30,000 is payable 12 months from the EFFECTIVE DATE.
2.
$30,000 is payable 24 months from the EFFECTIVE DATE.
15
