Exhibit 10.3
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TRADE SECRETS
AND
PROPRIETARY INFORMATION
ASSIGNMENT AGREEMENT
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BIODIESEL INDUSTRIES, INC.
AND
XXXXXXX X. XXXXX, III
01 JANUARY 2001
TRADE SECRETS AND PROPRIETARY
INFORMATION ASSIGNMENT AGREEMENT
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I
PARTIES
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THIS TRADE SECRETS AND PROPRIETARY INFORMATION ASSIGNMENT AGREEMENT
(the "Agreement") is entered into effective as of the ____ day of ________,
2001, by and between BIODIESEL INDUSTRIES, INC., a Nevada corporation
("Biodiesel"); AND, XXXXXXX X. XXXX, III, an individual residing in the State of
Florida ("Xxxxx"). Biodiesel and Xxxxx are sometimes referred to collectively
herein as the "Parties", and each individually as a "Party".
II
RECITALS
X. Xxxxx is an executive employee of Biodiesel, serving as its Chief
Executive Officer and Chairman of its Board of Directors.
X. Xxxxx has Proprietary Information regarding the business of
Biodiesel which is essential to the future of Biodiesel.
C. The Proprietary Information possessed by Xxxxx is his rightful and
legal property, with Biodiesel having no claim of right whatsoever to said
Proprietary Information, other than as provided for herein.
X. Xxxxx has provided financing to, and advanced sums of money on
behalf of, Biodiesel, and the Parties are desirous of providing for a mechanism
to repay Xxxxx for said amounts.
E. It is the intent of the Parties for Xxxxx to assign all of his
Proprietary Information to Biodiesel in exchange for payments in the future to
Xxxxx, which payments would serve to repay Xxxxx for all monies loaned to and
advanced on behalf of Biodiesel.
F. NOW, THEREFORE, in consideration of the promises and the mutual
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Parties, intending
to be legally bound, hereby agree as follows:
III
DEFINITIONS
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The following capitalized terms shall have the respective meanings
specified in this Article III. Other terms defined elsewhere herein shall have
meanings so given them.
3.1 CONFIDENTIAL INFORMATION. "Confidential Information" is to be
broadly defined, and includes all information that has or could have commercial
value or other utility in the business in which Biodiesel is engaged or
contemplates engaging, and all information of which the unauthorized disclosure
could be detrimental to the interests of Biodiesel, whether or not such
information is identified as Confidential Information by Biodiesel.
3.2 INTELLECTUAL PROPERTY. "Intellectual Property" means all
information and records pertaining to any idea, process, trademark, service
xxxx, invention, technology, computer hardware or software, original work of
authorship, design, formula, discovery, patent, copyright, product, and all
improvements, know-how, rights, and claims related to the foregoing. All
Intellectual Property shall be deemed "Confidential Information".
3.3 PROPRIETARY INFORMATION. "Proprietary Information" is all
information and any idea whatever form, tangible or intangible, pertaining in
any manner to the business of Biodiesel, or any of its affiliates, or its
employees, clients, consultants, or business associates, which was produced by
any employee or consultant of Biodiesel in the course of his or her employment
or consulting relationship or otherwise produced or acquired by or on behalf of
Biodiesel. All Proprietary Information not generally known outside of
Biodiesel's organization, and all Proprietary Information so known only through
improper means, shall be deemed "Confidential Information". By example and
without limiting the foregoing definition, Proprietary and Confidential
Information shall include, but not be limited to:
(a) formulas, research and development techniques, processes,
trade secrets, computer programs, software, electronic codes, mask works,
inventions, innovations, patents, patent applications, discoveries,
improvements, data, know-how, formats, test results, and research projects;
(b) information about costs, profits, markets, sales,
contracts and lists of customers, and distributors;
(c) business, marketing, and strategic plans;
(d) forecasts, unpublished financial information, budgets,
projections, and customer identities, characteristics and agreements; and
(e) employee personnel files and compensation information.
3.4 SUBJECT IDEAS OR INVENTIONS. "Subject Ideas or Inventions" includes
any and all ideas, processes, trademarks, service marks, inventions, designs,
technologies, computer hardware or software, original works of authorship,
formulas, discoveries, patents, copyrights, copyrightable works, products,
marketing and business ideas, and all improvements, know-how, data, rights, and
claims related to the foregoing that, whether or not patentable, which are
conceived, developed or created which: (i) relate to Biodiesel's current or
contemplated business or activities; (ii) relate to Biodiesel's actual or
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demonstrably anticipated research or development; (iii) result from any work
performed by Xxxxx for Biodiesel; (iv) involve the use of Biodiesel's equipment,
supplies, facilities or trade secrets; (v) result from or are suggested by any
work done by Biodiesel or at Biodiesel's request, or any projects specifically
assigned to me; or (vi) result from my access to any of Biodiesel's memoranda,
notes, records, drawings, sketches, models, maps, customer lists, research
results, data, formulae, specifications, inventions, processes, equipment or
other materials (collectively, the "Company Materials"). All Subject Ideas and
Inventions shall be deemed "Confidential Information".
IV
ASSIGNMENT
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4.1 TRANSFER OF RIGHTS. Upon execution hereof, Xxxxx shall transfer all
rights, title, and interests in all Confidential Information of Xxxxx related to
the business of Biodiesel in existence as of the date of the effective date of
this Agreement.
4.2 DELIVERY OF CONFIDENTIAL INFORMATION. As part of the transfer and
assignment under this Article IV, Xxxxx shall immediately deliver to Biodiesel
all copies of any and all materials and writings, in any form, which relate to
or contain Confidential Information.
4.3 OWNERSHIP RIGHTS. All right, title and interest in and to the
Confidential Information, including but not limited to all registrable and
patent rights which may subsist therein, shall be held and owned solely by
Biodiesel. Xxxxx hereby to respect and protect Biodiesel's rights therein. In
the event that Xxxxx shall, for any reason, by operation of law, be deemed to
retain any rights (whether moral rights or otherwise) to any Confidential
Information assigned hereunder, Xxxxx shall assign to Biodiesel, without further
consideration, his entire right, title and interest in and to each and every
such item of Confidential Information.
4.4 REASONABLE ASSISTANCE. Xxxxx further agrees to assist Biodiesel in
every reasonable way (solely at Biodiesel's expense) to obtain and from time to
time enforce patents, copyrights or other rights or registrations on said
Confidential Information in any and all countries, and to that end will execute
all documents necessary:
(a) to apply for, obtain and vest in the name of Biodiesel
alone (unless Biodiesel otherwise directs) letters patent, copyrights or other
analogous protection in any country throughout the world and when so obtained or
vested to renew and restore the same; and
(b) to defend any opposition proceedings in respect of such
applications and any opposition proceedings or petitions or applications for
revocation of such letters patent, copyright or other analogous protection; and
(c) to cooperate with Biodiesel (solely at Biodiesel's
expense) in any enforcement or infringement proceeding on such letters patent,
copyright or other analogous protection.
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4.5 LIMITED POWER OF ATTORNEY. In the event Biodiesel is unable, after
reasonable effort, to secure the signature of Xxxxx on any patent, copyright or
other analogous protection relating to Confidential Information, whether because
of the physical or mental incapacity of Xxxxx or for any other reason
whatsoever, Xxxxx hereby irrevocably designates and appoints Biodiesel and its
duly authorized officers and agents as Xxxxx'x agent and attorney-in-fact, to
act for and on his behalf and stead to execute and file any such application,
applications or other documents and to do all other lawfully permitted acts to
further the prosecution, issuance, and enforcement of letters patent, copyright
or other analogous rights or protections thereon with the same legal force and
effect as if executed by Xxxxx.
V
COMPENSATION
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In consideration for the transfer and assignment of the Confidential
Information hereunder by Xxxxx to Biodiesel, the Parties agree as follows:
5.1 CONTINUING ROYALTY. Biodiesel shall pay to Xxxxx a "royalty
payment" (as that term is commonly defined) equal to five percent (5%) of
Biodiesel's gross income, determined on a calendar year basis in accordance with
generally accepted accounting principles consistently applied.
5.2 PAYMENT OF ROYALTY. All royalty payments due hereunder shall be
paid to Xxxxx on before sixty (60) days after the end of each calendar year.
5.3 TERMINATION OF ROYALTY PAYMENT. Payment of the royalty hereunder
shall continue up to and until the earlier of the following:
(a) the closing of an underwritten public offering of the
Common Stock of Biodiesel;
(b) a sale of substantially all of the assets of Biodiesel;
(c) a merger or other similar acquisition or reorganization
transaction under which Biodiesel is not the surviving corporation;
(d) a sale of more than fifty percent (50%) of the issued and
outstanding Common Stock of Biodiesel; or
(e) The dissolution and winding up of the business of
Biodiesel.
5.4 DEATH OF XXXXX. Upon the death of Xxxxx, all obligations under this
Agreement shall inure to the successors and assigns of Xxxxx, and Biodiesel
shall continue to tender the royalty payments in accordance with this Agreement
to those designated by Xxxxx in his estate planning documents or pursuant to
operation of law.
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5.5 PRIOR MONIES OWED AND ADVANCED. The royalty payment hereunder shall
also serve to pay-in-full all prior monies loaned to, or advanced on behalf,
Biodiesel by Xxxxx.
VI
REPRESENTATIONS AND WARRANTIES OF XXXXX
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Xxxxx hereby represents and warrants to Biodiesel the following as of
and on the day this Agreement is executed:
6.1 EXECUTION OF AGREEMENT. The execution, delivery and consummation of
this Agreement will comply with all applicable law and will not:
(a) Violate any judgment, order, writ or decree of any court
or administrative body applicable to Xxxxx;
(b) Result in the breach of, constitute a default under,
constitute an event which with notice or lapse of time, or both, would become a
default under, or result in the creation of any right to proceed against
Biodiesel under any agreement, commitment, contract (written or oral) or other
instrument to which Xxxxx is a party.
6.2 PRIOR ACTIONS AND KNOWLEDGE. Xxxxx has not disclosed any
Confidential Information, directly or indirectly, to anyone outside Biodiesel,
or used, copied, published, or summarized any Confidential Information, except
to the extent otherwise permitted in this Agreement.
6.3 EMPLOYMENT AGREEMENT. Notwithstanding the continuing nature of the
royalty payment, Xxxxx'x employment is covered by a separate Employment
Agreement.
6.4 LEGAL COUNSEL. Xxxxx has had the opportunity to consult legal
counsel in regard to this Agreement. Xxxxx acknowledges that he has read and
understands this Agreement, that he is fully aware of its legal effect, and that
he has entered into it freely and voluntarily and based on his own judgment and
not on any representations or promises other than those contained in this
Agreement.
VII
REPRESENTATIONS AND WARRANTIES OF BIODIESEL
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Biodiesel hereby represents and warrants to Xxxxx the following as of
and on the day this Agreement is executed:
7.1 CORPORATE STATUS. Biodiesel is a corporation, duly organized,
validly existing and in good standing under the laws of the State of Nevada.
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7.2 POWER AND AUTHORITY. Biodiesel has the power and authority to:
(a) own and operate its properties and to carry on its
business as now being conducted;
(b) enter into, execute and deliver this Agreement, and the
agreements referred to herein, and to consummate the transactions contemplated
hereunder.
7.3 EXECUTION OF AGREEMENT. The execution, delivery and consummation of
this Agreement will comply with all applicable law and will not:
(a) Violate any judgment, order, writ or decree of any court
or administrative body applicable to Biodiesel;
(b) Result in the breach of, constitute a default under,
constitute an event which with notice or lapse of time, or both, would become a
default under, or result in the creation of any right to proceed against
Biodiesel under any agreement, commitment, contract (written or oral) or other
instrument to which Biodiesel is a party.
(c) Upon the execution and delivery of this Agreement,
Biodiesel will have all requisite power to enter into this Agreement and to
consummate the transactions contemplated hereunder. Thereafter, this Agreement,
and the other agreements referred to herein, will constitute the valid and
binding obligations of Biodiesel, and will be enforceable in accordance with
their respective terms.
VIII
INJUNCTIVE RELIEF
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Xxxxx hereby acknowledges that his failure to carry out any obligation
under this Agreement, or a breach by Xxxxx of any material provision herein,
will constitute immediate and irreparable damage to Biodiesel, which cannot be
fully and adequately compensated in money damages and which will warrant
preliminary and other injunctive relief, an order for specific performance, and
other equitable relief. Xxxxx further agrees that no bond or other security
shall be required in obtaining such equitable relief and he hereby consents to
the issuance of such injunction and to the ordering of specific performance.
Xxxxx also understands that other action may be taken and remedies enforced
against him.
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IX
ADDITIONAL PROVISIONS
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9.1 EXECUTED COUNTERPARTS. This Agreement may be executed in any number
of original, fax or copied counterparts, and all counterparts shall be
considered together as one agreement. A faxed or copied counterpart shall have
the same force and effect as an original signed counterpart. Each of the Parties
hereby expressly forever waives any and all rights to raise the use of a fax
machine to deliver a signature, or the fact that any signature or agreement or
instrument was transmitted or communicated through the use of a fax machine, as
a defense to the formation of a contract.
9.2 SUCCESSORS AND ASSIGNS. Except as expressly provided in this
Agreement, each and all of the covenants, terms, provisions, conditions and
agreements herein contained shall be binding upon and shall inure to the benefit
of the successors and assigns of the Parties hereto.
9.3 SECTION HEADINGS. The section headings used in this Agreement are
inserted for convenience and identification only and are not to be used in any
manner to interpret this Agreement.
9.4 SEVERABILITY. Each and every provision of this Agreement is
severable and independent of any other term or provision of this Agreement. If
any term or provision hereof is held void or invalid for any reason by a court
of competent jurisdiction, such invalidity shall not affect the remainder of
this Agreement.
9.5 GOVERNING LAW. This Agreement shall be governed by the laws of the
State of Nevada, without giving effect to any choice or conflict of law
provision or rule (whether of the State of Nevada or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the
State of Nevada. If any court action is necessary to enforce the terms and
conditions of this Agreement, the Parties hereby agree that the Superior Court
of Nevada, County of Xxxxx, shall be the sole jurisdiction and venue for the
bringing of such action.
9.6 ENTIRE AGREEMENT. This Agreement, and all references herein,
contains the entire understanding among the Parties hereto and supersedes any
and all prior written or oral agreements, understandings, and negotiations
between them respecting the subject matter contained herein.
9.7 ADDITIONAL DOCUMENTATION. The Parties hereto agree to execute,
acknowledge and cause to be filed and recorded, if necessary, any and all
documents, amendments, notices and certificates which may be necessary or
convenient under the laws of the State of Nevada.
9.8 ATTORNEY'S FEES. If any legal action (including arbitration) is
necessary to enforce the terms and conditions of this Agreement, the prevailing
Party shall be entitled to costs and reasonable attorney's fees.
9.9 AMENDMENT. This Agreement may be amended or modified only by a
writing signed by all Parties.
9.10 REMEDIES CUMULATIVE. The remedies of the Parties under this
Agreement are cumulative and shall not exclude any other remedies to which any
person may be lawfully entitled.
9.11 WAIVER. No failure by any Party to insist on the strict
performance of any covenant, duty, agreement, or condition of this Agreement or
to exercise any right or remedy on a breach shall constitute a waiver of any
such breach or of any other covenant, duty, agreement, or condition.
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9.12 ASSIGNABILITY. Except as otherwise provided in Section 5.4, above,
this Agreement is not assignable by either Party without the expressed written
consent of all Parties.
9.13 NOTICES. All notices, requests and demands hereunder shall be in
writing and delivered by hand, by facsimile transmission, by mail, by telegram
or by recognized commercial over-night delivery service (such as Federal
Express, UPS or DHL), and shall be deemed given (a) if by hand delivery, upon
such delivery; (b) if by facsimile transmission, upon telephone confirmation of
receipt of same; (c) if by mail, forty-eight (48) hours after deposit in the
United States mail, first class, registered or certified mail, postage prepaid;
(d) if by telegram, upon telephone confirmation of receipt of same; or, (e) if
by recognized commercial over-night delivery service, upon such delivery.
9.14 TIME. All Parties agree that time is of the essence as to this
Agreement.
9.15 DISPUTES. The Parties agree to cooperate and meet in order to
resolve any disputes or controversies arising under this Agreement. Should they
be unable to do so, then either may elect arbitration under the rules of the
American Arbitration Association, and both Parties are obligated to proceed
thereunder. Arbitration shall proceed in Xxxxx County, and the Parties agree to
be bound by the arbitrator's award, which may be filed in the Superior Court of
Nevada, County of Xxxxx. The Parties consent to the jurisdiction of Nevada
Courts for enforcement of this determination by arbitration. The prevailing
Party shall be entitled to reimbursement for his attorney's fees and all costs
associated with arbitration. In any arbitration proceeding conducted pursuant to
the provisions of this Section, both Parties shall have the right to conduct
discovery, to call witnesses and to cross-examine the opposing Party's
witnesses, either through legal counsel, expert witnesses or both, and the
provisions of the Nevada Code of Civil Procedure (Right to Discovery; Procedure
and Enforcement) are hereby incorporated into this Agreement by this reference
and made a part hereof.
9.16 PROVISION NOT CONSTRUED AGAINST PARTY DRAFTING AGREEMENT. This
Agreement shall be deemed to have been drafted by all Parties and, in the event
of a dispute, no Party hereto shall be entitled to claim that any provision
should be construed against any other Party by reason of the fact that it was
drafted by one particular Party.
9.17 INCORPORATION OF EXHIBITS AND SCHEDULES. The Exhibits and
Schedules identified in this Agreement are incorporated herein by reference and
made a part hereof as if set out in full herein.
9.18 RECITALS. The facts recited in Article II, above, are hereby
conclusively presumed to be true as between and affecting the Parties.
9.19 CONSENTS, APPROVALS AND DISCRETION. Except as herein expressly
provided to the contrary, whenever this Agreement requires consent or approval
to be given by a Party, or a Party must or may exercise discretion, the Parties
agree that such consent or approval shall not be unreasonably withheld,
conditioned, or delayed, and such discretion shall be reasonably exercised.
Except as otherwise provided herein, if no response to a consent or request for
approval is provided within ten (10) days from the receipt of the request, then
the consent or approval shall be presumed to have been given.
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9.20 NO THIRD PARTY BENEFICIARIES. This Agreement has been entered into
solely by and between Xxxxx and Biodiesel, solely for their benefit. There is no
intent by either Party to create or establish a third party beneficiary to this
Agreement, and no such third party shall have any right to enforce any right,
claim, or cause of action created or established under this Agreement.
9.21 BEST EFFORTS. The Parties shall use and exercise their best
efforts, taking all reasonable, ordinary and necessary measures to ensure an
orderly and smooth relationship under this Agreement, and further agree to work
together and negotiate in good faith to resolve any differences or problems
which may arise in the future.
9.22 DEFINITIONAL PROVISIONS. For purposes of this Agreement, (i) those
words, names, or terms which are specifically defined herein shall have the
meaning specifically ascribed to them; (ii) wherever from the context it appears
appropriate, each term stated either in the singular or plural shall include the
singular and plural; (iii) wherever from the context it appears appropriate, the
masculine, feminine, or neuter gender, shall each include the others; (iv) the
words "hereof", "herein", "hereunder", and words of similar import, when used in
this Agreement, shall refer to this Agreement as a whole, and not to any
particular provision of this Agreement; (v) all references to "Dollars" or "$"
shall be construed as being United States dollars; and, (vi) all references to
all statutes, statutory provisions, regulations, or similar administrative
provisions shall be construed as a reference to such statute, statutory
provision, regulation, or similar administrative provision as in force at the
date of this Agreement and as may be subsequently amended.
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EXECUTION
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IN WITNESS WHEREOF, this Agreement has been executed by the Parties,
and shall be effective as of and on the last date set forth below.
BIODIESEL: XXXXX:
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BIODIESEL INDUSTRIES, INC.,
a Nevada corporation
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NAME: XXXXXXX X. XXXXX, III
BY:__________________________
DATED:______________________
NAME:_______________________
TITLE:_______________________
DATED:______________________
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