CONFIDENTIAL TREATMENT
SETTLEMENT AGREEMENT
This Settlement Agreement is made, entered into, and effective as of
this 19th day of December, 1996 (the "Effective Date"), by and between Mobil Oil
Corporation, a New York corporation with its principal place of business at 0000
Xxxxxxx Xxxx, Xxxxxxx, Xxxxxxxx 00000 ("Mobil"), and BPI Packaging Technologies,
Inc., a Delaware corporation with its principal place of business at 000
Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxxxxx 00000 ("BPI").
WHEREAS, Mobil filed an action against BPI in the United States
District Court for the District of Delaware (Civil Action No. 95-737) (the
"Action") alleging infringement of Mobil's U.S. Patent No. Re. 34,019 (the "019
patent"), which issued on August 4, 1992 and is directed to plastic carrying
bags;
WHEREAS, BPI filed a counterclaim against Mobil in the Action alleging
infringement of BPI's U.S. Patent No. 4,877,473 (the "473 patent"), which issued
on October 31, 1989 and is directed to a method of making a bag pack;
WHEREAS, Mobil and BPI are desirous of reaching a final settlement and
disposition of their respective claims against each other in the Action;
NOW THEREFORE, in consideration of the mutual undertakings hereinafter
set forth, Mobil and BPI agree as follows:
1. BPI shall pay Mobil the sum of X* in four equal installments of X*
on each of the following dates: July 15, 1997, April 15, 1998, February 15,
1999, and December 15, 1999.
Payment shall be made by check made payable to Mobil Oil Corporation.
----------------
*Certain information withheld and filed separately with the Commission pursuant
to a request for confidential treatment.
1
2. BPI's payment obligations hereunder will be considered liquidated,
due and owing as of the date of this Settlement Agreement, and are neither
contingent upon, nor subject to modification by, any action or event whatsoever,
including, but not limited to, the outcome of the Action against the remaining
defendants, Inteplast Corporation and Integrated Bagging Systems Corporation, or
any finding of non-infringement, invalidity or unenforceability of the '019
patent.
3. BPI shall provide its reasonable cooperation in response to specific
informal discovery requests from Mobil, to the extent that the documents or
information requested by Mobil would have been otherwise discoverable in the
Action. If requested by Mobil, Xxxxxx X. Xxxxxxxxx, President of BPI, agrees to
appear and testify as a witness at the trial in the Action. If so requested,
Mobil will reimburse BPI for its costs in making Xx. Xxxxxxxxx available to
testify at trial.
4. In the event of any default under this Settlement Agreement
(including any failure to make any payment in accordance with the schedule set
forth in paragraph 1), Mobil shall have the right to seek an immediate judgment
in any court of competent jurisdiction for the immediate payment of the entire
amount of X* less any amounts already paid to Mobil under this Settlement
Agreement ("Remaining Liability"). In any such action by Mobil to enforce BPI's
obligations under this Settlement Agreement, BPI shall interpose no objections
to entry of judgment for the Remaining Liability. BPI shall be liable to Mobil
for all costs, including attorneys' fees, incurred in collecting said amounts
due and owing from BPI to Mobil.
5. Mobil hereby releases BPI from all liability for past damages with
respect to the '019 patent. This release shall not be deemed a release of any
claims under the '019 patent against any party other than BPI.
----------------
*Certain information withheld and filed separately with the Commission pursuant
to a request for confidential treatment.
2
6. BPI hereby releases Mobil from all liability for past damages with
respect to the '473 patent. This release shall not be deemed a release of any
claims under the '473 patent against any party other than Mobil.
7. Within ten (10) days of the Effective Date, Mobil and BPI shall
jointly file in the Action a joint motion in the form of Appendix A and take
such other action as may be necessary to cause the Action to be dismissed, with
prejudice, as between Mobil and BPI.
8. Mobil and BPI shall each bear its own costs and attorneys fees
associated with the Action.
9. Mobil hereby grants to BPI an irrevocable, nonexclusive, paid-up
license, without the right to sublicense, under the '019 patent to make, use,
and sell plastic carrying bags covered by the patent. This license shall extend
for the full term of the '019 patent.
10. BPI hereby grants to Mobil an irrevocable, nonexclusive, paid-up
license, without the right to sublicense, under the '473 patent to practice the
methods covered by the '473 patent and to make, use, and sell bags in accordance
with the methods covered by the '473 patent. This license shall extend for the
full term of the '473 patent.
11. The terms of this Settlement Agreement shall be maintained in
confidence by Mobil and BPI, and neither Mobil nor BPI shall disclose the terms
of this Settlement Agreement to any third party, except pursuant to a court
order or as required by law. The parties agree, however, that prior to making
any disclosure of the Settlement Agreement pursuant to a court order, the party
which has been or may be ordered to make such a disclosure shall give the
earliest possible notice to the other party and shall permit the other party to
contest the court order or its application to the Settlement Agreement.
3
12. This Settlement Agreement represents the entire agreement and
understanding between Mobil and BPI with respect to the subject matter hereof
and it supersedes any and all prior or contemporaneous discussions, agreements,
and understandings relating thereto. This Settlement Agreement may not be varied
or modified other than by a writing executed on behalf of the parties.
13. This Settlement Agreement shall be binding upon and inure to the
benefit of Mobil and BPI and their respective successors and assigns; provided,
however, that neither party may assign or transfer the licenses granted herein
without the prior written consent of the licensing party. Any attempt to assign
or transfer a license without the prior written consent of the licensing party
shall be null and void and shall not be binding on the licensing party.
14. Any payment, notice, or communication required by or relating to
this Settlement Agreement shall be in writing and delivered to Mobil at:
Mobil Oil Corporation
0000 Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxx, Esq.
and to BPI at: BPI Packaging Technologies, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
15. This Agreement shall be governed by the laws of the State of
Delaware. Mobil and BPI consent to be subject to the jurisdiction of the
Delaware state and federal courts with regard to any litigation arising from any
dispute regarding this Settlement Agreement. The parties specifically agree not
to interpose any defense of lack of personal jurisdiction or improper venue in
an action brought in Delaware state or federal courts to enforce any provision
of this Settlement Agreement.
4
16. It is understood and agreed by the parties that the execution of
this Settlement Agreement and the terms, conditions and consideration recited,
are solely for the purpose of settling and compromising disputed matters, and
that the Settlement Agreement does not constitute and shall not be construed as
an admission of any kind by either party in connection with the Action or any
other demand, claim, action, proceeding or lawsuit.
IN WITNESS WHEREOF, the parties hereto have caused this Settlement
Agreement to be executed by their duly authorized representatives, as of the
Effective Date indicated above. MOBIL OIL CORPORATION BPI PACKAGING
TECHNOLOGIES, INC.
By: /s/ By: /s/ C. Xxxx Xxxxxxxxx
---------------------- ----------------------
Title: Title: President
---------------------- --------------------
Date: December 16, 1996 Date: December 19, 1996
----------------------- ------------------
5
