EXCLUSIVE LICENSE AGREEMENT
Exhibit
10.1
THIS
EXCLUSIVE LICENSE AGREEMENT (this “Agreement”) is entered into on this 20th day
of March, 2006, by and between Xxxxxxxxxx Xxxxxxxx, an individual residing
at
Xxx Xxxxxxxx, 000X, Xxxx [Xxxxxxxxx], Xxxxx (“Licensor”), and H2Diesel, Inc., a
Delaware corporation having its principal offices located at 00000 Xxxxxxxxxx
Xxxx, Xxxx Xxxxx, Xxxxxxx 00000 (the “Licensee”), on behalf of which Xx. Xxx
Xxxxx is authorized to sign this Agreement.
RECITALS
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A.
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Licensor
is the first and sole inventor of a certain chemical additive for
use in
making bio-fuel for internal combustion engines, including all related
formulas, technical specifications, know-how and other related proprietary
information (collectively, the “Product”) and is the exclusive owner of
all intellectual property other proprietary rights with respect to
same.
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B.
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Licensee
desires to obtain an exclusive license from Licensor to make, use
and sell
the Product in the Territory comprising North America, Central America
and
Caribbean nations as further specified in Schedule
A
attached hereto as well as other regions that may be added by mutual
agreement of the parties (collectively, the “Territory”), and Licensor
desires to grant such license to Licensee on the terms and conditions
set
forth herein.
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NOW,
THEREFORE, in consideration for the mutual covenants and promises contained
in
this Agreement and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. GRANT
OF EXCLUSIVE RIGHTS; CONSIDERATION.
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a.
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Exclusive
License.
Subject to the other terms and conditions set forth in this Agreement,
Licensor hereby grants to Licensee the exclusive right and license
to
make, cause to be made, use, distribute, sell, offer related services,
sublicense others to do the same and otherwise to commercialize and
exploit the Product, as well as any and all modifications, enhancements,
variations, improvements and related technology developed by or for
Licensor in the future, including under the claims of any patents
owned by
Licensor now or in the future in and throughout the Territory. Licensor
shall not himself or through third parties (other than Licensee)
exercise
any such rights within the Territory while this Agreement is in effect.
In
furtherance of same, Licensee shall have the right to engage
subcontractors to manufacture and/or distribute part or all of the
Product
and, as between Licensor and Licensee, Licensee shall be responsible
for
all production, storage, distribution, order processing and fulfillment,
billing and collection activities with respect to sales of the Product
in
the Territory.
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b.
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Consideration.
In consideration of the rights granted to Licensee in Section 1.a.
above,
Licensee agrees to pay to Licensor, while this Agreement is in effect
and
provided that Licensor performs its obligations hereunder, the following
consideration:
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(i) Eleven
Million Dollars ($11,000,000) payable as follows:
A. One
and
One-Half Million Dollars ($1,500,000) due and payable within three (3) business
days after execution and delivery of this Agreement;
B. One
Million Dollars ($1,000,000) due and payable no later than one hundred eighty
(180) days after the Effective Date (as defined in Section 6 (a) below);
C. One
and
One-Half Million Dollars ($1,500,000) due and payable no later than three
hundred sixty-five (365) days after the Effective Date;
D. One
Million Dollars ($1,000,000) on each subsequent anniversary of the Effective
Date for the seven (7) years thereafter; and
(ii) a
twelve
and one-half percent (12.5%) equity ownership interest in Licensee, to be issued
to Licensor within sixty (60) days after the Effective Date/other], provided
that Licensor executes and delivers to Licensee an investor representations
letter in a form to be provided by Licensee including customary investor
representations together with a written joinder to Licensor’s stockholders
agreement agreeing to be bound by the terms thereof.
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c.
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Option
to Acquire Exclusive Rights in South America; Requirements Regarding
Paraguay Licensee.
Licensee is hereby granted the exclusive option to acquire the exclusive
right and license to make, cause to be made, use, distribute, sell,
offer
related services, sublicense others to do the same and otherwise
to
commercialize and exploit the Product in and throughout South America,
excluding Paraguay, said option being exercisable by Licensee within
the
first six (6) months after the Effective Date by providing written
notice
thereof to Licensor, in exchange for payment of an additional Ten
Million
Dollars ($10,000,000) as follows:
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(i) One
and
One-Half Million Dollars ($1,500,000) due and payable upon exercise of said
option;
(ii) One
and
One-Half Million Dollars ($1,500,000) due and payable no later than one hundred
eighty (180) days after exercise of said option; and
(iii) One
Million Dollars ($1,000,000) due and payable on or before each subsequent
anniversary of the exercise date of said option for the seven (7) years
thereafter.
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Licensor
shall require its licensee in Paraguay to sell the Product and/or
any
components thereof at prices not lower than the lowest prices offered
by
Licensee for same in any part of the
Territory.
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d.
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Other
Expansion of the Territory.
The Territory may be further expanded by mutual agreement of the
parties,
and should Licensor desire to grant any rights to third parties in
the
future with respect to the Product not already granted to Licensee
(excluding Italy), Licensor shall provide written notice via fax
thereof
to Licensee and offer same to Licensee first before offering to others.
In
the event that the parties are unable to agree in principle with
respect
to the material terms of such proposed grant of additional rights
within
thirty (30) days after Licensee’s receipt of such notice from Licensor,
Licensor may then offer such rights to third parties, provided that
the
terms offered by Licensor are the same as those that were offered
to
Licensee.
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e.
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Technical
Information Regarding the Product.
Within twenty (20) days after the Effective Date of this Agreement,
Licensor shall disclose to Licensee any and all technical information
and
know-how then within the knowledge or possession of Licensor which
was not
already disclosed to Licensee and which would be helpful to Licensee
in
the manufacture, use or sale of the Product. Licensor further agrees
to
provide continued disclosure of same to Licensee with respect to
any
future developments, modifications, enhancements, new products and
related
technology developed or otherwise acquired by Licensor while this
Agreement is in effect. The disclosure shall take place either at
Licensee’s offices or telephonically, or as otherwise agreed to by the
parties. Licensor shall, while this Agreement is in effect, cause
its
employees and any third parties who are employed or engaged to do
research, development or other inventive work relating to the Product
to
disclose all inventions, discoveries, know-how and other work product
resulting therefrom to Licensor and to assign to Licensor all rights
with
respect to same to Licensor such that Licensee shall receive, by
virtue of
this Agreement, the exclusive license with respect thereto throughout
the
Territory as agreed hereunder.
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2. LICENSEE
UNDERTAKINGS; PRODUCT TESTING.
a. Patent
Notices.
Licensee agrees to xxxx, as appropriate, the following with appropriate patent
pending notices and/or patent numbers, as applicable, in conformity with
applicable law:
(i) all
packaging or dispensers for the Product made or sold by or for Licensee;
and
(ii) all
brochures, manuals, and documents describing the Product.
b. Export
Control.
Licensee shall not export or allow the export or re-export of the Product
without compliance with applicable export laws and regulations of the U.S.
Department of Commerce and all other U.S. agencies and authorities, including
without limitation, the Export Administration Regulations of the U.S. Department
of Commerce Bureau of Export Administration (as contained in 15 C.F.R. Parts
730-772), and, if applicable, relevant foreign laws and
regulations.
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c.
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Regulatory
Compliance.
Licensee acknowledges that certain regulatory licenses and approvals
may
be required to be obtained with respect to the Product from appropriate
government authorities in the Territory from time to time during
the term
of the Agreement. Licensee will obtain and maintain all such licenses
and
approvals at its own expense. Licensor will make available to Licensee
information and assistance as requested by Licensee and/or necessary
to
complete all applications and requests for
approval.
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d.
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Registration
Statement for Licensee Securities.
Licensee shall undertake commercially reasonable efforts to cause
a
registration statement to be filed with the Securities and Exchange
Commission with respect to Licensee’s securities within one hundred eighty
(180) days after the Effective Date.
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e.
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Product
Testing.
Licensee shall have the right, at its expense, to cause to be performed
tests to evaluate and measure the performance and commercial viability
of
the Product for use as a fuel additive or component including, emission
tests, tests relating to fuel consumption, engine performance,
calorimetric energy yield, stability sight and
formula
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analysis. Licensee may engage third parties in connection with such testing and shall have the right to disclose the Product to such third parties for such purposes. Xxxxxx Xxxxxxxxx shall be part of Licensor’s scientific committee to assist Licensee in the management of such testing and improvement of the technology in the Territory. |
3. REPRESENTATIONS,
WARRANTIES AND COVENANTS OF LICENSOR.
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a.
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Representations
and Warranties.
Licensor represents and warrants to Licensee and its affiliates
that:
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(i) Licensor
is the sole owner of all rights, title and interest, including all intellectual
property rights in and to the Product, free and clear of liens, claims or other
encumbrances of any kind, other than previously granted licenses outside the
Territory;
(ii) Licensor’s
execution and delivery of this Agreement does not require any third party
consent or approval that has not already been obtained;
(iii) Licensor
has sufficient rights to grant the rights granted hereunder to
Licensee;
(iv) Licensor
has the legal power and authority to grant the rights and licenses to Licensee
as set forth in this Agreement;
(v) this
Agreement and all other agreements to be executed by Licensor in connection
herewith constitute the valid and binding obligations of Licensor, enforceable
against Licensor in accordance with their respective terms;
(vi) the
Product does not infringe or otherwise violate any third party intellectual
property or other right, no third party license is required in order for
Licensee to exercise the rights granted to it hereunder throughout the
Territory, and no suit, action, or claim has been instituted or threatened
by
any third party involving the Product or any of the rights licensed hereunder
or
infringement of any third party intellectual property or other right;
(vii) Licensor
is the first and sole inventor of the Product and that the Product is patentable
throughout the Territory;
(viii) the
Product will meet all stability sight and other performance test standards
undertaken with respect to same;
(ix) the
Product can be mass produced without loss of performance qualities;
(x) bio-fuel
that is merchantable and commercially fit for usage in internal combustion
engines and provides equal performance as compared to normal diesel fuel can
be
made in accordance with the following formulas: for multi-jet new generation
diesel engines: [CONFIDENTIAL PORTION OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]; and for traditional diesel engines:
[CONFIDENTIAL PORTION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION];
(xi) the
Product can be used for fuels for automobiles and other internal combustion
engine-powered devices without requiring modification of such devices
(excluding
4
possible
change
of
fuel filter). The Licensor has verified that the Product has not caused any
damage to such devices installed on two cars (one with a traditional diesel
engine, and the other with a JTD (MUTI-JET)) engine over a distance of 140,000
km;
and
(xii) Licensor
has not made and will not make any commitments to others inconsistent with
or in
derogation of Licensee’s rights.
(xiii) Licensor
does not make any representations or warranties with regard to any tests other
than those referred to in Section 2(e) above, except as may be otherwise agreed
by the parties;
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b.
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Maintenance
of Exclusivity.
Licensor represents and warrants to Licensee that it has not, and
covenants to Licensee that during the term of this Agreement, it
will not,
grant any other license for sale, use or manufacturing of the Product
within the Territory or elsewhere other than in compliance with this
Agreement.
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c.
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Provision
of Information for Regulatory Approvals.
Licensor shall provide to Licensee all pertinent and necessary information
in order for Licensee to apply for and obtain any required safety
or other
regulatory approvals to commercially market and sell the
Product.
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e.
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Scientific
Committee.
Given his technical competence and his personal capabilities, Xxxxxx
Xxxxxxxxx, a chemical engineer, will direct, with complete autonomy
and
with all powers necessary, the Licensor’s Scientific Committee. The
purpose of the Scientific Committee is to manage, coordinate, and
oversee
all the technical inspections and scientific tests for the verification
and improvement of the Product. Upon Licensee’s advance written
authorization, Xxxxxx Xxxxxxxxx will cooperate with Licensee to arrange
for the development of the testing activities for the Product, cited
above.
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f.
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On
account of his technical-commercial competence and his personal
capabilities, Xx. Xxxxx Xxxxxxxxx will undertake to direct and coordinate
on Licensor’s behalf, in full autonomy and with all powers necessary, all
commercial relations developed in the future outside of the Territory,
remaining the sole individual responsible on Licensor’s behalf for this
aspect.
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4. INFRINGEMENT
BY THIRD PARTIES.
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a.
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Notification
of Infringements.
Should Licensor or Licensee become aware of any infringement or alleged
infringement of any patents covering any portion of the Product,
misappropriation of trade secrets or any other infringement or violation
of the intellectual property rights relating to the Product, that
party
shall immediately notify the other party in writing of the name and
address of alleged infringer, the alleged acts of infringement, and
any
available evidence of infringement.
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b.
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Enforcement
of Rights.
Licensee shall have primary responsibility for enforcing any patent, trade
secret or other intellectual property rights relating to the Product,
whether on
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behalf of Licensor or as Licensor’s exclusive licensee, against any third parties and shall have the right to bring legal action against such third parties to enforce such rights. If Licensee fails to take action against any such third parties within one hundred eighty (180) days of being notified regarding same, Licensor may, at Licensor’s option, bring legal action against such third parties in the name of Licensor to enforce such rights. In the event that any such litigation results in a damage award favoring the party bringing action to enforce any such rights, such a damage award shall be the property of the party that pursued such litigation. |
5. INDEMNIFICATION.
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a.
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Indemnification
by Licensor.
Licensor shall, at its expense, indemnify, defend and hold harmless
Licensee, its affiliates, sublicensees and subcontractors, and their
respective employees, officers and agents (each, a “Licensee Indemnified
Party” and collectively, the “Licensee Indemnified Parties”) from and
against any and all claims and causes of action of any nature made
or
lawsuits or other proceedings filed or otherwise instituted against
any of
the Licensee Indemnified Parties arising from or relating to any
breach by
Licensor of any of its representations, warranties or obligations
hereunder. Licensor shall be responsible for and shall pay all costs
and
expenses related to such claims and proceedings, including, but not
limited to, the payment of all attorney’s fees and costs of litigation,
defense and/or settlement of same. In the event that the Product,
in part
or as a whole, infringes or is accused of infringing a third party’s
intellectual property rights, in addition to the foregoing indemnification
obligations, Licensor shall either (a) procure for Licensee and its
sublicensees the right to continue making, using and selling the
Product,
(b) provide Licensee and its sublicensees with a functionally equivalent,
non-infringing replacement for the Product, or (c) refund all fees
paid by
Licensee hereunder, and assign back to Licensee the equity interest
in
Licensee granted to Licensor pursuant to Section 1.b. (ii)
above.
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b.
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Indemnification
Procedures.
In claiming any indemnification hereunder, Licensee shall promptly
provide
Licensor with written notice of any claim that Licensee believes
falls
within the scope of the foregoing paragraph. Licensee may, at its
own
expense, assist in the defense if it so chooses, in which case Licensee
may elect to control such defense and all negotiations relative to
the
settlement of any such claim and further provided that any settlement
intended to bind Licensor shall not be final without Licensor’s written
consent, which shall not be unreasonably withheld.
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c.
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Set-Off
Right.
Licensee shall have the right to deduct and set-off any damages,
costs or
expenses (including, without limitation, legal fees and expenses)
incurred
by Licensee with respect to any claims for which it is entitled to
indemnification pursuant to this Agreement against any amounts payable
to
Licensor hereunder, and may impose a lien on the equity interest
in
Licensee granted to Licensor pursuant to Section 1.b.(ii) as collateral
for such indemnification
obligations.
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6. TERM,
RENEWAL AND TERMINATION.
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a.
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Term.
The term of this Agreement shall commence on the date that the first
payment is made (“Effective Date”) and continue in effect in perpetuity
unless sooner terminated as provided below (the “Term”).
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b.
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Termination
by Licensor.
Licensor shall have the right to terminate this Agreement by providing
written notice thereof to Licensee describing the basis for such
termination if any of the following events occur: (i) if Licensee
materially defaults in performing any of its other obligations under
this
Agreement, or (ii) if a proceeding is commenced by or against Licensee
seeking liquidation, conservatorship or other relief with respect
to
Licensee or its assets under any bankruptcy, insolvency or other
similar
law, or seeking the appointment of a trustee, receiver or other similar
official with respect to Licensee and/or a substantial portion of
its
assets, and such default is not cured, or such proceeding is not
dismissed, within ninety (90) days after Licensor has provided written
notice to Licensee of its intentions to terminate this Agreement
and
specifying the reasons for same.
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c.
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Termination
by Licensee.
Licensee shall have the right to terminate this Agreement by providing
written notice thereof to Licensor if any of the following events
occur:
(i) if Licensor materially defaults in performing any of its obligations
hereunder, or (ii) if Licensor becomes insolvent or if a proceeding
is
commenced by or against Licensor seeking liquidation, rehabilitation,
reorganization, conservatorship or other relief with respect to Licensor
or its assets under any bankruptcy, insolvency or other similar law,
or
seeking the appointment of a trustee, receiver or other similar official
with respect to Licensor and/or a substantial portion of its assets
and
such default is not cured, or such proceeding is not dismissed, within
ninety (90) days after Licensee has provided written notice to Licensor
of
its intentions to terminate this Agreement and specifying the reasons
for
same. Additionally, Licensee shall have the right to terminate this
Agreement at any time for convenience by providing written notice
thereof
to Licensor not less than thirty (30) days prior to the effective
date of
such termination.
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d.
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Post-Termination
Obligations; Phase-out Period.
Subsequent to the termination of this Agreement for any reason, Licensee
may, for up to twelve (12) months after the effective date of such
termination, continue to sell its inventory of the Product. Thereafter
Licensee shall not engage in the further use, sale, or other
commercialization of the Product without Licensor’s prior written consent,
which consent shall not be withheld
unreasonably.
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e.
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Effect
of Termination.
Nothing herein shall be construed to release either party from any
obligation which matured prior to the effective date of such termination
or which may continue beyond such termination, and any unpaid payments
due
from Licensee under this Agreement as of the effective date of termination
shall become immediately due and payable to Licensor. Licensor
acknowledges and agrees that this Agreement and all rights and licenses
granted under or pursuant to this Agreement by Licensor to Licensee
are,
and shall otherwise be deemed to be licenses of rights to intellectual
property. Licensor agrees that Licensee, as a licensee of such rights
under this Agreement, shall retain and may fully exercise all of
its
rights and elections under applicable bankruptcy, insolvency or other
similar law, including specifically but without limitation, Section
365(n)
of the U.S. Bankruptcy Code, as amended. Licensor further agrees
that, in
the event of the commencement of a voluntary or involuntary proceeding
against Licensor seeking liquidation, rehabilitation, reorganization,
conservatorship or other relief with respect to it or its assets
under any
bankruptcy, insolvency or other similar law, Licensee, in addition
to its
right to terminate this Agreement, shall also have the right, at
its
election, to retain all of its rights under this
Agreement.
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f.
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Rights
of Sublicensees after Termination of License Agreement.
The termination of this Agreement shall not affect the continued
effectiveness of any sublicenses previously granted by Licensee with
respect to the Product pursuant to this Agreement and still in effect
as
of the effective date of such termination, provided that the sublicensee
is in full compliance with the terms of the applicable sublicense
agreement then in effect with respect to the Product. In the event
of
termination of this Agreement for any reason other than by Licensee
due to
an uncured breach by Licensor, all agreements with sublicenses with
respect to the Product entered into by Licensee pursuant to this
Agreement
shall thereupon automatically be deemed assigned to Licensor. Licensor
shall be thereafter be deemed the licensor under same under all such
agreements. Said substitution shall be effective and self-operative,
without the execution of any other instrument, and the sublicenses
shall
continue in accordance with their terms between the sublicensee and
Licensor; provided that Licensor shall not be liable for any prior
act,
omission or breach of any duty or obligation by Licensee.
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7. TAXES,
GOVERNMENTAL APPROVALS.
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a.
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Taxes.
Licensee shall be solely responsible for the payment and discharge
of any
taxes, duties, or withholdings relating to any transaction of Licensee
in
connection with the manufacture, use, sale, licensing or other
commercialization or exploitation of the Product. Licensor is solely
responsible for any and all taxes, fees relating to its ownership
of
intellectual property rights in and to the Product, including but
not
limited to taxes on all amounts paid to Licensor
hereunder.
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b.
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Government
Approvals.
Licensee shall, at its own expense, be responsible for applying for
and
obtaining any regulatory approvals, authorizations, or validations
relative to the Product and/or manufacture and sale of the Product
under
the appropriate national laws or
otherwise.
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8. INDEPENDENCE
OF THE PARTIES.
This
Agreement creates no relationship of partnership, joint venture, employment,
franchise, or agency between the parties. This Agreement shall not constitute
the designation of either party as the representative or agent of the other,
nor
shall either party to this Agreement have the right or authority to make any
promise, guarantee, warranty, or representation, or to assume, create, or incur
any liability or other obligation of any kind, express or implied, against
or in
the name of, or on behalf of, the other party, without the other party’s prior
written consent and approval.
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a.
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Sublicensing.
Licensor authorizes Licensee to grant sublicenses of the rights granted
to
it hereunder to its subdistributors, contractors and other third
parties
as reasonably necessary for Licensee to perform its obligations hereunder.
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b.
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Assignment
by Licensee.
Except as provided for in Section 9.a.
above or as otherwise provided for in this Agreement, Licensee
shall not
have the right to assign or otherwise transfer this Agreement and/or
any
rights acquired by Licensee hereunder, except to an affiliate or
in
connection with a sale of all or substantially all of its assets,
or in
connection with obtaining financing for its business, without the
prior
written consent of Licensor, which consent shall not be unreasonably
withheld. As used herein, “affiliate” means any person or entity directly
or indirectly controlling or having the power
to
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control, or controlled by or being under common control with another person or entity. For this purpose, “control” means the direct or indirect possession of power to direct or cause the direction of the management or policies of such party, whether through ownership or stock or other securities, by contract or otherwise. Ownership of more than fifty percent (50%) of the beneficial interest of an entity shall be conclusive evidence that control exists. |
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c.
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Assignment by Licensor; Right of First Refusal. Licensor shall not have the right to assign or otherwise transfer this Agreement, including rights acquired by Licensor under this Agreement to payments, to any third party other than Licensee, without the prior written consent of Licensee, which consent shall not be unreasonably withheld. Such assignment or transfer shall not be deemed effective unless such assignee or transferee has agreed in writing to acknowledge Licensee’s right hereunder and be bound by the terms and provisions of this Agreement. In the event that Licensor shall at any time determine to sell, assign or otherwise transfer all or part of Licensor’s rights with respect to the Product or this Agreement, Licensor shall obtain a bona fide executed written offer from the proposed transferee and shall submit an exact copy of such offer to Licensee. Licensee shall have the right, exercisable by written notice delivered to Licensor within sixty (60) days from the date of delivery of an exact copy of such offer to Licensee, to purchase such rights and interests for the price and on the terms and conditions contained in such offer, provided that Licensee may substitute cash or its or its affiliates’ securities for any form of payment proposed in such offer and shall not have less than ninety (90) days to prepare for closing. If Licensee does not exercise the above-described right of first refusal, Licensor may complete the sale to such purchaser pursuant to and on the terms of such offer, provided that if the sale to such purchaser is not completed within one hundred twenty (120) days after delivery of such offer to Licensee or there is a material change in the terms of the proposed transaction, Licensee shall again have the right of first refusal herein provided. |
10. NOTICES.
Any
notice or communication permitted or required under this Agreement shall be
in
writing and shall be delivered in person or by courier, or mailed by certified
or registered mail, postage prepaid, return receipt requested, and addressed
as
set forth for the intended recipient in the first paragraph of this Agreement,
to the attention of the President of Licensee in the case of notices delivered
by Licensor to Licensee, or to such other address as shall be given in
accordance with this Section. If notice is given in person or by courier, it
shall be effective upon receipt; and if notice is given by mail, it shall be
effective five (5) business days after deposit in the mail.
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a.
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Arbitration.
Any dispute, controversy or claim arising out of or relating to this
Agreement or the interpretation, breach, termination or validity
thereof,
other than those for which injunctive relief is appropriate, shall
be
finally settled in accordance with the Commercial Arbitration Rules
of the
American Arbitration Association (the “AAA”) then obtaining, by a panel of
three (3) arbitrators. Each party shall have the right to appoint
one (1)
arbitrator from the list of arbitrators supplied to the parties by
the
AAA, and the two (2) arbitrators so appointed shall appoint the third.
The
parties may agree to a single arbitrator in lieu of a panel of three
arbitrators.
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The place of arbitration shall be Miami, Florida, U.S.A. and each party hereto irrevocably consents and submits to the exclusive jurisdiction of such arbitration panel in such venue. The language of the arbitration shall be in English. The arbitrators shall determine the matters in dispute in accordance with the internal laws of the State of Florida without reference to the Convention on Contracts for the International Sale of Goods. The parties agree that the award of the arbitrators shall be the sole and exclusive remedy between them regarding any claims, counterclaims, issues or accountings presented or pled to the arbitrators, that the award shall be made and shall be promptly payable in U.S. dollars, free of any tax, deduction or offset, and that any costs, fees or taxes instant to enforcing the award shall, to the maximum extent permitted by law, be charged against the party resisting such enforcement. The award shall include interest from the date of damages incurred for breach or other violation of this Agreement, and from the date of the award until paid in full, at a rate to be fixed by the arbitrators. |
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b.
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Governing
Law.
This Agreement shall for all purposes be governed by and interpreted
in
accordance with the laws of the State of Florida without reference
to its
choice of law principles.
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12. ATTORNEY’S
FEES.
In
the
event that there is a default under this Agreement and it becomes reasonably
necessary for any party to employ the services of any attorney, either to
enforce or terminate this Agreement, with or without arbitration, the
non-defaulting party shall be entitled to collect from the defaulting party
its
reasonable attorneys fees and such other costs and expenses as are incurred
by
it in enforcing or terminating this Agreement.
13.
INTELLECTUAL PROPERTY PROTECTION; IMPROVEMENTS AND NEW
PRODUCTS.
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a.
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Intellectual
Property Protection.
Licensee shall undertake commercially reasonable efforts to seek
and
obtain patent protection for the Product in the countries comprising
the
Territory on behalf of Licensor and Licensee shall bear the expenses
associated therewith. Licensee shall also be responsible at Licensee’s
expense for maintaining in force for the available patent term any
patents
that are granted as a result thereof while this Agreement is in effect.
Licensor shall provide all necessary and/or requested cooperation,
documentation and assistance, including, without limitation, execution
and
delivery of oaths, declarations, powers of attorney, affidavits,
testimony
and any other documents or instruments that may be required or requested
by Licensee in connection therewith, as well as in connection with
Licensee’s enforcement of such rights against third
parties.
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b.
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Improvements to the Product; New Inventions. In the event that Licensee, through its employees or independent contractors, invents or causes to be invented any improvements, refinements or modifications to the Product or new products related to the Product, Licensee shall own all intellectual property and other rights with respect thereto without a duty to account or any other duty to Licensor with respect to same, and shall be entitled to commercialize and exploit same as Licensee determines in its sole and absolute discretion only in the Territory. Licensee shall communicate any improvements, refinements or modifications to the Product or new products related to the Product (referred to as “Product Improvements”), and Licensor shall be entitled to commercialize and exploit such Product Improvements in all the other countries except the Territory, as may be expanded from time to time, subject to the terms |
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and conditions herein; and subject to a cross-licensing arrangement to be agreed between Licensor to Licensee that will contain, among other terms and conditions, provisions for a cross-licensing royalty payable by Licensor. |
a
nd
14. GENERAL
PROVISIONS.
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a.
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Entire
Agreement.
The parties hereto have read this Agreement and agree to be bound
by all
its terms. The parties further agree that this Agreement, together
with
the stockholders agreement referred to in Section 1.b.(ii) above,
shall
constitute the full, complete and exclusive statement of the Agreement
between them and supersedes all agreements, proposals, oral or written,
and all other communications between them relating to the subject
matter
of this Agreement.
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b.
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Modifications.
No agreement changing, modifying, amending, extending, superseding,
discharging, or terminating this Agreement or any provisions hereof
shall
be valid unless it is in writing and is dated and signed by duly
authorized representatives of the party against which enforcement
is
sought.
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c.
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Severability.
Should any term or provision of this Agreement be finally determined
by an
arbitration panel to be void, invalid, unenforceable or contrary
to law or
equity, the offending term or provision shall be modified and limited
(or
if strictly necessary, deleted) only to the extent required to conform
to
the requirements of law and the remainder of this Agreement (or,
as the
case may be, the application of such provisions to other circumstances)
shall not be affected thereby but rather shall be enforced to the
greatest
extent permitted by law.
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d.
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Waiver.
Failure of any of the parties hereto to enforce any of the provisions
of
this Agreement or any rights with respect thereto or to exercise
any
election provided for therein, shall in no way be considered a waiver
of
such provisions, rights, or election or in any way to affect the
validity
of this Agreement. No term or provision hereof shall be deemed waived
and
no breach excused, unless such waiver or consent shall be in writing
and
signed by the party claimed to have waived or consented. Any consent
by
any party to, or waiver of, a breach by the other, whether express
or
implied, shall not constitute a consent or waiver of, or excuse for
any
other, different or subsequent breach. All remedies herein conferred
upon
any party shall be cumulative and no one shall be exclusive of any
other
remedy conferred herein by law or
equity.
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e.
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Currency;
Days; Time of the Essence.
All monetary amounts referred to herein are in U.S. Dollars and all
references to days mean calendar days. Time is of the essence in
the
performance of each and every obligation and covenant imposed by
this
Agreement.
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f.
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Binding
Agreement.
This Agreement shall be binding not only upon the parties hereto,
but also
upon their respective successors, permitted assignees and in the
case of
Licensor, his heirs.
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g.
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Force
Majeure.
Neither Party shall be liable to the other party on account of any
loss,
damage, or delay occasioned or caused by strikes, riots, fires and
floods,
insurrection, terrorist attacks, war, the elements, embargoes, failure
of
carriers, inability to obtain material or transportation facilities,
acts
of God or of the public enemy, compliance with any law, regulation
or
other governmental order, or any other causes beyond the control
of either
party whether or not similar to the foregoing (“Force Majeure” or
“Force
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11
Majeure
Event”). Every reasonable effort shall be made by the party claiming Force
Majeure to avoid delay or suspension of performance hereunder, but neither
party
shall be required to do so in any manner in which such party does not deem
to be
in its best interest in order to be able to perform its obligations hereunder.
As soon as practicable after occurrence of any Force Majeure Event, the party
claiming Force Majeure shall notify the other party in writing of such Force
Majeure Event and, to the extent possible, inform the other party of the
expected duration of the Force Majeure Event and the performance to be affected
by the suspension or curtailment under this Agreement. After the termination
of
any Force Majeure Event, as soon as practicable, the party claiming Force
Majeure shall notify the other party in writing of the termination of such
Force
Majeure Event and of the anticipated timing of the resumption of performance.
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h.
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Expenses.
Except as provided elsewhere in this Agreement, all of the legal,
accounting, and other miscellaneous expenses incurred in connection
with
this Agreement and the performance of the various provisions of this
Agreement shall be paid by the party who incurred the expense. Licensee
acknowledges and agrees that it shall be responsible for all costs
and
expenses for preparing and filing a PCT patent application for the
Product
in all the countries that agree to the PCT (Patent Cooperation Treaty)
in
the name of the Licensor, to be executed by a patent lawyer appointed
by
Licensee . Those costs are in addition to any payments to be made
hereunder by the Licensee..
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i.
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Survival.
All covenants, agreements, representations, warranties, indemnities
and
provisions of this Agreement which by their nature are intended survive
the termination of this Agreement (including, without limitation,
Sections
3, 5, 6.d.-f., 7.a., 8-12, and 14) shall so survive after the effective
date of termination of this
Agreement.
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j.
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Disclaimer
of Warranties; Limitation of Liability.
EXCEPT FOR THE WARRANTIES EXPRESSLY PROVIDED HEREIN, NEITHER PARTY
HERETO
MAKES ANY WARRANTIES AND DISCLAIMS ANY IMPLIED WARRANTIES OF ANY
KIND,
INCLUDING, BUT NOT LIMITED TO, ANY IMPLIED WARRANTIES OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE OR AGAINST INFRINGEMENT WITH REGARD
TO
THE PRODUCT OR THE PERFORMANCE OF ITS OBLIGATIONS HEREUNDER. EXCEPT
FOR
CLAIMS INVOLVING FRAUD OR OTHER WILLFUL MISCONDUCT OR NEGLIGENCE,
NEITHER
PARTY SHALL BE LIABLE TO THE OTHER PARTY WITH RESPECT TO ANY PUNITIVE,
SPECIAL, CONSEQUENTIAL, INCIDENTAL OR INDIRECT DAMAGES, INCLUDING
WITHOUT
LIMITATION, LOST PROFITS ARISING OUT OF THE PERFORMANCE OF NONPERFORMANCE
OF THIS AGREEMENT, EVEN IF THE PARTY HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES.
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k.
|
Confidentiality. Each party acknowledges that it has in the past and may in the future receive Confidential Information belonging to, and disclosed to it, by the other party and/or its authorized representatives, and that all of the other party’s Confidential Information is material and confidential and greatly affects the goodwill and the effective and successful conduct of such party and its business and operations, and that maintaining confidentiality of such party’s Confidential Information is reasonably necessary to protect the legitimate business interests of such party. Accordingly, each party hereby agrees to receive all such Confidential Information provided by the other party in strict confidence and that neither it nor any of its officers, directors, representatives, employees or agents (including any consultants, subcontractors or |
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advisors) shall, at any time while this Agreement is in effect or thereafter, directly or indirectly, divulge, reveal or communicate any such Confidential Information to any person, firm, corporation or entity whatsoever, or use, pursue or exploit any such Confidential Information for its own benefit or for the benefit of others. Each party agrees not to infringe any of the other party’s intellectual property or other rights in its Confidential Information, and nothing herein shall be construed as expressly or impliedly granting a license or right to use such Confidential Information by the other party except with respect to the rights granted to Licensee with respect to the Product and as otherwise expressly provided herein and/or as reasonably necessary for Licensee to engage and utilize subcontractors for testing, manufacturing, distribution, sale and other commercialization of the Product as contemplated hereunder. Each party shall disclose to and enforce the confidentiality provisions of this Agreement in writing with respect to all of its officers, directors, representatives, employees or agents (including any consultants, subcontractors or advisors), as applicable. The foregoing restrictions shall not apply to Licensee to the extent that such information comprises the Product or related technology after a patent application has been filed for the Product, or to the extent that, with respect to either party, such information: |
(i) is
or
becomes public knowledge (other than by breach of that
restriction);
(ii) was
obtained by the recipient party from a third party having the right to disclose
it, without the obligation to keep such information confidential;
(iii) was
independently developed by the recipient party without the use of such
Confidential Information and without the participation of individuals who have
had access to such Confidential Information; or
(iv) is
required to be provided by law, legal process (including subpoena, civil
investigative demand or similar process) or any regulatory authority; provided,
that the recipient party shall promptly notify the disclosing party in writing
so the disclosing party may seek a protective order and/or other motion to
prevent the production of such Information.
For
purposes of this Agreement, “Confidential
Information”
means
information relating to a party hereto and its assets, operations, clients,
and
past, present, and future businesses, including but not limited to know-how,
drawings, manuals, reports, formulae, algorithms, processes, trade secrets,
computer software, computer data bases, computer software documentation,
research products, inventions, technical data, specifications, designs, ideas,
product plans, research and development efforts, personal and customer
information, financial information, quotations, price lists, customer lists,
business methods and operations and marketing programs, all of which are
proprietary with such party and involve trade secrets, know-how, techniques,
and
combinations of known information of a character regarded by such party as
confidential, except as otherwise provided above with respect to the
Product.
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l.
|
Further
Assurances.
Each party agrees to execute and deliver such other and further documents
and instruments as may be necessary to effectuate the intent and
purposes
of this Agreement upon request by the other
party.
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m.
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Construction;
Counterparts.
The headings used in this Agreement are for reference purposes only
and
shall not be considered a part of this Agreement. This Agreement
may
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be executed in counterparts, each of which shall be deemed to be an original and all of which shall constitute one and the same agreement. For the convenience of the Licensor, a copy of this Agreement is being translated into Italian for convenience of the parties. In the event of a conflict between this English version and the Italian version, this English version shall govern and prevail. |
IN
WITNESS WHEREOF,
the
parties hereto have executed or caused this Agreement to be executed as of
the
Effective Date.
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LICENSOR:
XXXXXXXXXX
XXXXXXXX
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LICENSEE:
H2Diesel,
Inc., a Delaware corporation
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/s/
Xxxxxxxxxx Xxxxxxxx
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/s/
Xxx X. Xxxxx
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Signature
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Signature
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Name:
Xxx X. Xxxxx
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||
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Title:
President
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14
SCHEDULE
A
Territory
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A.
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North
America:
United States of America, its possessions and territories (including
without limitation Puerto Rico), Canada and
Mexico.
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B.
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Central America: Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama. |
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C.
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Caribbean:
Antigua & Barbuda, Aruba, Bahamas, Cayman Islands, Cuba (currently
subject to U.S. embargo), Dominica, Dominican Republic, Grenada,
Guadeloupe, Haiti, Jamaica, Martinique, St. Kitts & Nevis, St. Lucia,
St. Xxxxxxx and the Grenadines, Trinidad & Tobago, Turks & Caicos
Islands, and Virgin Islands.
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Option
Territory
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South
America, excluding Paraguay:
Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, French Guiana,
Guyana, Peru, Suriname, Uruguay and
Venezuela.
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