Exhibit 10.22
LICENSE AGREEMENT
between
TITAN TECHNOLOGIES INCORPORATED
3206 Xxxxxxxxxx N.E. X0xxxxxxxxx, Xxx Xxxxxx 00000
(hereinafter referred to as "Titan")
and
PPT HOLDING, LTD.
000 X. Xxxxxxxx, Xxxxx 0 X, Xxxxxx, Xxxxx 00000
(hereinafter referred to as "PPT")
WITNESSETH:
Whereas, TITAN is the owner of certain proprietary technologies
(hereinafter collectively referred to as the "Technology") with respect to
recycling of tires in order to recover marketable oil, steel and carbon
therefrom (but specifical1y excluding any applications of the Technology with
respect to waste products other than tires); and
Whereas, TITAN has previously authorized use of the Technology in tire
recycling plants located in xxx Xxxxxxxx xx Xxxxx (xxxxx Xxxxx) and Taiwan and,
in connection therewith, has supervised construction and commissioning of such
plants; and
Whereas, PPT believes it has preliminary financial arrangements in place
for in construction and operation of three the recycling plants in the Republic
of Mexico, at a feed rate of 100-150 tons of tires per day per plant, including
satisfactory preliminary commitments for supply of tires at such rate;
Whereas, has access to a site, building and infrastructure in Nuevo Laredo,
Mexico for a plant using the Titan Technology at a rate of not less than 100
tons of shredded tires per day;
Now therefore, TITAN and PPT agree as follows:
I. PLANT LICENSE
A. In consideration of the payment of a non-refundable deposit in the amount
of US $340,000.00, of which have been previously received, and the balance
of $160,000 to be paid on or before April 30, 2006.
Titan from and after the date that the $500,000.00 is fully paid grants to
PPT an exclusive license (the "License") to utilize its technology and
patents for construction and operation of throughout Mexico and to utilize
Titan's Technology for the three tire recycling plants in Mexico (the
"Plants") on the conditions stated Section I. E below. PPT shall have no
ownership rights to the Technology other than the right to utilize Titan's
technology in the Republic of Mexico for the construction and operation of
three tire recycling plants utilizing Titan's TRTM technology and the
license to build and operate additional plants in Mexico on the conditions
stated below. Each stage that processes a maximum capacity of tires, not to
exceed 150 tons per day is considered to be a plant. The License for each
of the first three plants shall commence upon the payment of an additional
payment of $300,000 toward the licensing fee as stated in Paragraph I.B.
below by PPT, assuming that PPT has funding in place for construction and
operation of the plant and pays all other amounts under this License
Agreement. Design, permitting, financing, governmental approvals and
commencement of construction of the first plant must be completed
(hereinafter called "Commencement of Construction") on or before September
15, 2006. If the License fee payment for the first plant of $300,000 is not
paid by PPT to Titan and construction commenced on the first plant on or
before September 15, 2006, this Agreement and the License shall be and
become null and void unless extended by mutual agreement in writing.
The Commencement of Construction of the second plant must be completed and
payment of the initial license fee of $300,000 for said second plant must
be paid by PPT to Titan on or before September 15, 2007. The Commencement
of Construction of the third plant must be completed and payment of the
initial license fee of $300,000 for said third plant must be paid by PPT to
Titan on or before September 15, 2008. If PPT fails to build, operate or
commence construction of all three plants by September 15, 2008, then the
exclusive License for the Republic of Mexico and any plants for which
construction has not commenced shall terminate and cease to be exclusive
and will become a non-exclusive license of Titan's technology for Mexico
and the $200,000 paid for the exclusive license will be applied toward the
license fee of the next plant to be built by PPT. If all three plants are
not commenced, completed or in operation by September 15, 2008, then the
exclusive license fee for Mexico and any plant deposits previously paid
will become the property of Titan and the license for any plant(s) for
which construction has not commenced will terminate and any further
obligation of Titan to PPT cease. The termination of the exclusive license
or loss of any license to build a plant or plants will not affect the
license granted to PPT for any plants built or commenced prior to September
15, 2008. If PPT builds all three plants prior to September 15, 2008, PPT
will be granted the exclusive license for Titan's Technology for the
Republic of Mexico in perpetuity (the "Territory"), subject to payment of
Titan's then applicable license fee for each plant and execution of Titan's
then applicable license agreement for each plant.
B. The Licensing Fee for the Territory of Mexico and the balance of fees and
royalties for each plant will be paid to Titan in accordance with the
following schedule:
(i) An initial deposit of $100,000.00 for each of the three plants
($300,000.00) and the $200,000.00 license fee for Mexico (US $340,000
of which has previously been paid) shall be paid by PPT to Titan no
later than April 30, 2006; and
(ii) $300,000 shall be paid upon commencement of construction of each
plant;
(iii)$300,000 shall be paid upon completion of construction of each plant;
and
(iv) $300,000 shall be paid to Titan when each plant reaches a maximum
capacity of tires, not to exceed 150 tons per day.
(v) Production royalties shall commence when each plant reaches a maximum
capacity of tires, not to exceed 150 tons per day.
The production royalties shall be $4.00 per U.S. ton of tires fed into the
plant for processing, payable quarterly by January 30, April 30, July 30,
and October 30 for the preceding quarter for every quarter after each plant
reaches a maximum capacity of tires, not to exceed 150 tons per day.
C. PPT shall be responsible for completing detailed engineering for each
plant(in consultation with Titan) with an engineering firm pre-approved in
writing by Titan based upon process flow diagrams previously furnished by
Titan and preliminary design work performed by Xxxxxxxx Xxxxxx.
D. Titan agrees to provide two Titan technical personnel to be under the
direction of PPT to provide such technical assistance as may be necessary
or advisable for detailed engineering construction, commissioning and
operations of each plant, including the period following execution of this
Agreement until the Initial Plant is completed and until each Plant has
become fully operational. The salaries and travel expenses of such
technical personnel shall be paid for by PPT on a current basis within 10
days after the end of any month during which Titan technical personnel
provide services for PPT away from Titan's Albuquerque office. For purposes
of this Agreement, the salaries payable by PPT for said technical personnel
shall be based upon an annual salary of $75,000 per person plus applicable
payroll taxes and Titan shall notify PPT what portion of said employee's
monthly salary and what travel expenses were actually incurred working on
the Initial Plant at PPT's direction out of Albuquerque, based upon a 4O
hour work week.
Also, prior to execution of this Agreement Titan has provided to PPT copies
of U.S. Patents 5,871,619 and 5,714,043. IRT acknowledges that Xxx. No.
5,714,043 has lapsed and a new provisional patent has been filed by Titan
with the U.S Patent Office. Titan and PPT are satisfied that Titan's
technology is sufficient to operate the proposed plants.
E. The exclusive license to utilize Titan's Technology in the Republic of
Mexico shall commence when Commencement of Construction of the first plant
begins and the initial license fee payment of $300,000 for said first plant
is delivered to Titan. Said license shall be exclusive as to each plant for
such period as each Plant is in continuous operation. The License shall
also be deemed to grant PPT the right to use the Technology for the purpose
of generating electric power within the defined Territory through
combustion of products produced using the Technology. Titan shall not grant
licenses for the tire recycling Technology (including its use for
generation of electric power) to third parties in the Republic of Mexico,
so long as the conditions of Article I above are met.
II. SUBSEQUENT PLANTS
A. PPT may add additional plant locations when PPT identifies other locations
and has the necessary financing in place and is ready to sign a licensing
agreement for any subsequent plant.
The license fee for each additional plant shall be $l,000,000 per
plant, 25% of which shall be paid to Titan at the time the License is
granted; 25% of which shall be paid at the time construction commences; 25%
of which shall be paid at the time construction is completed: and 25% of
which shall be paid when operation of the plant reaches a maximum capacity
of tires, not to exceed 150 tons per day.
Production royalties for each subsequent plant shall be paid quarterly as
stated above.
Each subsequent plant shall have its own form of Agreement.
B. PPT acknowledges that Titan has on-going discussions with third parties for
construction of tire recycling plants using the Technology with respect to
other locations outside the Republic of Mexico and that Titan shall have
the free and unfettered right to conclude licensing transactions for the
Technology in any other area, state or country.
Nothing shall prevent Titan from negotiating or completing a merger,
consolidation, reorganization or similar transaction with a third party
that desires to purchase tire recycling or other technologies owned or
controlled by Titan, subject to the provisions of this Agreement.
C. Titan and PPT mutually acknowledge and agree that Titan shall be free and
unencumbered to pursue other opportunities outside the Territory covered by
the License.
III. GENERAL PROVISIONS
A. Titan represents that its technology includes the above described patents
and other trade secrets and know how with respect to the Technology.
B. Titan and PPT shall use reasonable efforts to ensure that Titan's patent
rights are protected and enforced within. the Territory covered by the
License. Titan shall retain exclusive ownership of the Technology,
including the patents and patent rights. In addition, all proprietary
rights to design, know-how, copyright or improvements or modifications to
the process or processes shall remain or become the exclusive property of
Titan, and PPT agrees to execute such documents as may be required from
time to time to assign and transfer to Titan such rights at no further
costs or fees to Titan.
C. Titan shall exclusively be entitled to apply for and register any patents
or patent improvements arising out of this Agreement or definitive
Agreements hereafter, and PPT shall sign all necessary applications or
otherwise provide its approval with respect to any such applications or
registrations. PPT shall similarly assist Titan in protecting its patent
rights or proprietary knowledge within the scope of the License and this
Agreement.
D. All prior agreements signed by the parties prior to this Agreement are
hereby null and void, except for the document entitled Confidentiality and
Non-Circumvention Agreement, which is attached hereto as Exhibit A (and by
this reference made a part hereof), which shall survive any termination of
this Agreement.
E. This transaction will be effective when signed by all parties hereto. Each
party states that it has adopted the appropriate corporate resolutions
authorizing adoption and completion of this transaction and that the
persons signing for each corporation have the requisite corporate
authorization and capacity to sign this Agreement
IV. TERMINATION
This Agreement shall terminate upon the occurrence of the following events:
(i) Failure of PPT to make any of the payments required in this Agreement
on or before the dates provided for said payments herein, unless such
failure is cured within Fifteen (15) business days following the date
written notice by Titan that any such payment has not been received is
delivered to PPT at the address below, or such other address provided
to Titan by PPT.
(ii) By mutual agreement of the parties; or
(iii) In the event any Plant is constructed and operated, this Agreement
shall terminate as to any such plant upon the permanent cessation of
operations of said Plant and the winding up of all matters in
connection with the cessation of operations
V. ARBITRATION AND GOVERNING LAW
This Agreement is governed by the laws of the State of New Mexico. Any disputes
concerning this Agreement shall be Exclusively and finally settled by
arbitration in accordance with the provisions of the Uniform Arbitration Act as
in effect in the State of New Mexico with venue lying in Albuquerque, New
Mexico. Provided, however, that nothing contained herein shall be deemed to
restrict the right of Titan to seek other remedies in any jurisdiction of its
choosing in the event that any such dispute re1ates to alleged violation of the
Confidentiality and Non- Circumvention Agreement attached hereto as Exhibit A.
VI. NOTICES
Notices hereunder shall be given in writing and addressed to the parties at the
respecti1re addresses set forth on the first page of this Agreement. Notices
shall not be effective unti1 receipt has been confirmed to the Party sending the
notice. Provided, however, that notices hereunder shall a1so be effective if
personally delivered to an officer of the recipient or given by facsimile copier
with receipt confirmed. For purposes of this Article, the facsimi1e copier
number of Titan is (505) 881-71l3 (Attention: Mr. Xxx Wi1der) the fax address
for PPT is O11- 52-867-713--0460 (Attention: Xx. Xxxxxxx Xxxxxx and to
0-000-000-0000 and by mail to PPT at 000 X. Xxxxxxxx, Xxxxx 0 X, Xxxxxx, Xxxxx
00000.
In witness whereof, the parties have executed this Agreement this 9th day
of February, 2OO6.
Titan Technologies Incorporated
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
President
Pioneer Processing Technologies, Ltd.
By: /s/ Xxxx Xxxxxx Xxxxxxx Xxxxxxxx
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Xxxx Xxxxxx Xxxxxxx Xxxxxxxx
By: /s/ Xxxx Xxxx Xxxxxxx Xxxxxx Tornedo
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Xxxx Xxxx Xxxxxxx Xxxxxx Tornedo
