REVISED AMENDED AND RESTATED TECHNOLOGY LICENSE AGREEMENT
This Revised Amended and Restated Technology License Agreement (the
"Agreement") is made and entered into August 19, 2005, between Bio-Products
International, Inc. ("Bio-Products"), a company incorporated under the laws of
the State of Alabama (the "Licensor"), and World Waste Technologies, Inc. (WWT),
a company incorporated under the laws of the State of California (the
"Licensee") (the Licensor and Licensee may hereinafter be either individually
referred to as the "Party" or collectively referred to as the "Parties").
PREMISES:
Whereas, Xx. Xxxxxxx X. Xxxx ("Xxxx"), in his continuous capacity as an
employee of the University of Alabama in Huntsville ("UAH"), developed certain
proprietary intellectual property, patented processes, and patent pending
processes for the volume reduction, separation, recovery, and recycling of
various components of waste materials, including without limitation, Municipal
Solid Waste ("MSW"), which technology has been reduced to United States Patent
No. 6,306,248 (the "U.S. Patent") and Patent Cooperation Treaty, International
Application No. PCT/US01/50049 (the "PCT") (collectively, the "UAH Technology").
The UAH Technology constitutes the first of the two parts of the "Technology"
(as defined herein). Xxxx is the majority stockholder, a Director, and the
President and CEO of Bio-Products;
Whereas, pursuant to that certain Amended and Restated License Agreement,
effective August 18, 2003, which supersedes and replaces the original license
agreement dated November 13, 1992, which was amended effective November 5, 1997
and amended again effective August 31, 1999, between UAH and Bio-Products (the
"UAH License") (a complete copy of which is attached as Exhibit A), UAH granted
an exclusive worldwide license to Bio-Products covering the UAH Technology,
including the rights to make, have made, use, lease and sell certain products,
and to practice certain processes, and to license some or all of the rights
granted to Bio-Products by UAH to others, such products and processes being more
specifically defined in the UAH License;
Whereas, Xxxxxx X. Xxxxxx ("Xxxxxx") developed certain proprietary
intellectual property, equipment designs, and process operating procedures
related to the UAH Technology, including the expertise and know-how for
fabrication and continuous operation of a small waste reduction process plant at
a commercial sanitary landfill for a period of eighteen months (collectively,
the "Malley/M&M Technology"). Malley (the Developer") and M&M Consulting, Inc.
("M&M", a company incorporated under the laws of the State of Mississippi) have
assigned to Bio-Products, exclusively throughout the world, all right, title and
interest in the Malley/M&M Technology. A complete copy of the Amended and
Restated Stock Purchase and Assignment Agreement (the "Malley/M&M Assignment")
is attached as Exhibit B. The Malley/M&M Technology constitutes the second of
the two parts of the "Technology" (as defined herein). M&M is a stockholder in
Bio-Products, and Malley is a Vice President of Bio-Products;
Whereas, the original Technology License Agreement, dated June 21, 2002,
was between Bio-Products and World Waste Holdings, Inc. ("WWHI"), incorporated
under international law in Anguilla, British West Indies, and WWHI assigned the
said Technology License Agreement to World Waste of America, Inc. ("WWA"), a
company incorporated under the laws of the State of California, effective May
12, 2003 (a complete copy of which is attached as Exhibit C);
Whereas, WWA and all of its assets, including the June 21, 2002 Technology
License Agreement with Bio-Products, was acquired by Waste Solutions, Inc.
("WSI"), a California corporation, in a merger and reorganization in which WWA
became a wholly owned subsidiary of WSI, dated March 22, 2004 (a complete copy
of which is attached as Exhibit D);
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Whereas, WSI filed a Certificate of Amendment of Articles of Incorporation
to the Secretary of State of the State of California changing the name of the
corporation to World Waste Technologies, Inc. ("WWT") on March 24, 2004 (a
complete copy of which is attached as Exhibit E);
Whereas, Bio-Products desires to enter into this Revised Amended and
Restated Technology Agreement with the Licensee to provide the Technology and
future improvements for the construction and operation of commercial scale MSW
processing and recycling facilities subject to the terms and conditions set
forth herein;
Whereas, the Licensee either has the financial resources, or has agreed to
use their best efforts to secure the financial resources, for the design,
engineering, and fabrication of processing equipment and facilities, acquisition
and permitting of construction sites, purchase of processing equipment,
construction and operation of commercial scale MSW processing and recycling
facilities, and marketing and promotion of said commercial facilities that are
compatible with the Technology;
Whereas, the Licensee desires to enter into this Revised Amended and
Restated Technology Agreement with Bio-Products to use the Technology and future
improvements for the construction and operation of commercial scale MSW
processing and recycling facilities subject to the terms and conditions
hereinafter set forth;
Whereas, the Parties wish to execute this Revised Amended and Restated
Technology Agreement between the Parties as herein set forth to supercede and
replace the Amended and Restated Technology License Agreement, executed on June
21, 2004, which superceded and replaced the original Technology License
Agreement, dated June 21, 2002, and June 21, 2002 shall remain the effective
date of this Agreement; and
Now, therefore, in consideration of the premises and the mutual covenants
contained herein, the Parties hereto agree as follows:
ARTICLE I - DEFINITIONS
For purposes of this Agreement, the following words and phrases shall have
the following meanings:
1.1 "Technology" shall mean the inventions, technology, and proprietary
intellectual property and information developed by Bio-Products, Eley, Malley,
and UAH created or discovered prior to or after the effective date of this
Agreement, including, but not limited to, inventions, processes, process
operating procedures and discoveries, patents, patent applications, trade
secrets, developments, facility designs, equipment designs, works of authorship,
formulas, software programs, techniques, information, expertise, know-how, data,
research, mask works, all intellectual and industrial property rights of any
sort, all rights of integrity, disclosure and withdrawal, copyrights, trade
names and trademarks, which are related to the recycling, processing,
collection, storage, disposal, treatment, utilization or reduction of waste or
waste components. Technology as defined in this Agreement does not include or
prohibit any end uses of the cellulosic product or other by-products of the
process, with the exception of the use of the cellulosic product in applications
in which the cellulosic product of waste, including MSW, processed utilizing the
Technology is either used directly as a fuel source or converted into an end
product for energy production which remains exclusively licensed to
Bio-Products. Technology otherwise includes without limitation, the UAH
Technology, the Malley/M&M Technology, United States Patent Number 6,306,248 and
Patent Cooperation Treaty International Application Number PCT/US01/50049.
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1.2 "Third Party" shall mean any person or entity other than Bio-Products,
Eley, Malley, UAH, the Licensee and Sub-Licensees of the Licensee.
1.3 "Operating Day" shall mean the day in which the facility (i) processes
waste equal to or in excess of the facility's daily design capacity as warranted
in Section 5.7; or (ii) processes all of the waste brought to the facility for
processing on such day; or (iii) processes as much waste as allowed by any
downstream limitations, such as but not limited to, any limitations on the
downstream processing or disposal of the cellulosic product.
1.4 "Cellulose Product" shall be defined as the smallest size material
obtained from screening the processed materials produced utilizing the
Technology, typically through a one-half inch screening device, in which more
than fifty percent (50%) by dry weight can be chemically characterized as
material originating from forest products or other living plants.
1.5 "Bio-Products Affiliate" means a corporation or other legal entity
formed and doing business, and in which Bio-Products directly holds or owns (i)
at least fifty-one percent (51%) of the equity or ownership interest in such
corporation or other legal entity; and (ii) sufficient voting rights to enable
Bio-Products to nominate and elect at least a majority of the board of directors
or other managing authority and maintain control in the direction of the
business operations and strategies of such corporation or other legal entity;
and (iii) an active operational interest, not merely a passive investment
interest, in such corporation or other legal entity.
1.6 "Proposed Construction Notice" means a written notice containing (i) a
description of the proposed facility, (ii) the identity of the prospective
location for the proposed facility, (iii) a detailed financial and business plan
for the proposed facility and its operation, and (iv) the identity of the
proposed feedstock provided and its proposed feedstock contract.
ARTICLE II - GRANT OF LICENSE
2.1 Subject to the terms and conditions of this Agreement, Bio-Products
hereby grants a license to the Licensee to utilize the Technology to construct
and operate commercial scale MSW processing and recycling facilities in the
United States of America ("USA").
(a) The license granted by Bio-Products to the Licensee under this
Agreement shall be exclusive in all of the States, territories, and
possessions of the USA with the following exceptions: (i)
Bio-Products shall retain the exclusive right and license to utilize
the Technology to construct and operate commercial scale MSW
processing and recycling facilities in the USA for applications in
which the cellulosic product of waste, including MSW, processed
utilizing the Technology is either used directly as a fuel source or
converted into an end product for energy production; (ii) except as
otherwise provided for herein, Bio-Products shall retain the
exclusive right and license to utilize the Technology to construct
and operate commercial scale MSW processing and recycling facilities
in the State of Arkansas; and (iii) Bio-Products shall retain a
non-exclusive right and license to construct and operate additional
commercial scale MSW processing and recycling facilities utilizing
the Technology in one or all of the States of Alabama, Tennessee,
Georgia, and/or South Carolina, providing the total number of
facilities in these States does not exceed four (4) (the
"Bio-Products Retained Sites") and further providing that
Bio-Products shall be required to draw its MSW feedstock for said
four Bio-Products Retained Sites only from within the State
boundaries of each of said four States and/or from within 75 miles
from the State border outside the State in which the operating
facility exists. The above notwithstanding, upon written requests
from the Licensee, (i) Bio-Products shall grant site-specific
sub-licenses to the Licensee for applications in which the
cellulosic product of waste, including MSW, processed utilizing the
Technology is either used directly as a fuel source or converted
into an end product for energy production; (ii) Bio-Products shall
grant site-specific sub-licenses to the Licensee to construct and
operate facilities utilizing the Technology in the State of
Arkansas. In addition, Bio-Products hereby grants the Licensee a
first right of refusal in accordance with the terms of Section
2.1(b) hereof.
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(b) Right of First Refusal. As stated in Paragraph 2.1(a), Bio-Products
or a Bio-Products Affiliate, as defined in paragraph 1.5, shall
retain (i) a non-exclusive right and license to construct and
operate up to four (4) Bio-Products Retained Sites, i.e., up to four
(4) facilities utilizing the Technology in the States of Alabama,
Tennessee, Georgia, and South Carolina and (ii) the exclusive right
and license to construct and operate commercial scale MSW processing
and recycling facilities utilizing the Technology in the State of
Arkansas (the "Arkansas Sites") (collectively, the Bio-Products
Retained Sites and the Arkansas Sites shall be referred to herein as
the "ROFR Sites"). Bio-Products and Licensee hereby agree that a
right of first refusal is hereby granted to Licensee to participate
in the ROFR Sites as follows:
(i) Proposal Notice. If at any time Bio-Products or a Bio-Products
Affiliate proposes to develop and construct a ROFR Site, then
Bio-Products shall give Licensee a Proposed Construction
Notice pursuant to Section 14.15 hereof of Bio-Products' or
Bio-Products Affiliate's intention to develop a ROFR Site. To
the extent Bio-Products has been discussing the ROFR Site with
a Bio-Products Affiliate or any Third Party, the Proposed
Construction Notice shall also include all details regarding
those discussions and a copy of any written proposal, term
sheet or letter of intent or other agreement relating to the
proposed ROFR Site with said Bio-Products Affiliate or other
Third Party(ies).
(ii) Licensee's Option. Licensee shall have an option for a period
of ninety (90) days from receipt of the Proposed Construction
Notice to elect to finance, own and control up to one hundred
percent (100%) of the project in accordance with the material
terms and conditions as described in the Proposed Construction
Notice. Licensee may exercise such option by notifying
Bio-Products in writing pursuant to Section 14.15 hereof
before expiration of the ninety (90) day period. If Licensee
exercises such option and elects to own and control more than
50%, (i) each facility covered by said exercise shall not be
considered as one of the Bio-Products Retained Sites, if
Licensee has majority interest (interest greater than 50%),
and (ii) the Licensee shall reimburse Bio-Products for its
actual out-of-pocket expenses incurred in securing said
facility within ninety (90) days of exercising its option, and
pay Bio-Products a Sales Commission equal to three percent
(3%) of the proposed capital cost of the facility (excluding
the cost of the vessel(s)), payable in four equal installments
with each such installment due 90 days, 180 days, 270 days,
and 360 days, respectively, from the date Licensee secures and
completes financing for the facility or begins construction
and placing orders for equipment prior to completion of
financing of the facility. Notwithstanding the foregoing,
Licensee shall not have an option pursuant to this Section
2.1(b) with respect to the first two "Proposed Exempt Site(s)"
(as defined below). For the purposes hereof, the term
"Proposed Exempt Site(s)" shall mean a proposed ROFR Site
which processes, or is capable of processing, no more than
2000 tons per day located in the State of Arkansas, Alabama,
Tennessee, Georgia, and South Carolina."
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(iii) Non-Exercise of Rights. To the extent that Licensee has not
exercised its rights to develop the proposed facility within
the time periods specified above, Bio-Products or a
Bio-Products Affiliate shall have the right to construct the
facility upon terms and conditions (including the capital
commitment) no more favorable than those specified in the
Proposed Construction Notice and the Licensee shall then grant
a site-specific sub-license (said sub-license shall not be
sub-licensable or otherwise transferable for any reason
without the prior written consent of Licensee) to Bio-Products
or a Bio-Products Affiliate, as the case may be. Every effort
will be made by the Parties to avoid locating facilities that
would compete for waste in the same collection areas.
2.2 The term of this license shall extend from the effective date of the
original Technology License Agreement, which is June 21, 2002, for a period of
twenty (20) years, unless extended, terminated or replaced by agreement of the
Parties hereto, or unless otherwise extended or terminated, as elsewhere
provided in this Agreement. This Agreement shall be extended automatically until
the expiration date of the last patent issued to Bio-Products and/or UAH
covering the Technology.
2.3 Anything to the contrary contained elsewhere in this Agreement
notwithstanding, Bio-Products shall retain all of the exclusive rights granted
under the UAH License and all of the exclusive rights assigned by the Malley/M&M
Assignment, including the worldwide exclusive right to license some or all of
its rights not granted to the Licensee under this Agreement to Third Parties to
utilize the Technology.
2.4 Subject to the terms and conditions of this Agreement, Bio-Products
hereby grants to Licensee the right to obtain an exclusive option or license to
utilize the Technology to construct and operate commercial scale MSW processing
and recycling facilities outside the United States upon the following
conditions:
(a) From the date of this Amended and Restated Technology License
Agreement, Bio-Products agrees to inform Licensee of any written
offer from a Third Party to obtain an exclusive option or license
for a foreign country not currently under an exclusive option or
license that is acceptable to Bio-Products. Licensee will be granted
a period of thirty (30) days from the date of notification in which
to elect to purchase the option or license for said country on the
same terms and conditions as contained in the written offer from the
Third Party. If Licensee exercises its right to purchase the option
or license for said country during the thirty (30) day period, then
Bio-Products shall grant an exclusive option or license to Licensee
under the terms and conditions stated in the written offer from the
Third Party. If Licensee fails to exercise its right to purchase the
option or license within the thirty (30) day period, then
Bio-Products may grant an exclusive option or license for said
country to the Third Party making the initial offer.
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(b) The Licensee may from time to time submit a written request to
Bio-Products naming each country in which it wishes to obtain an
option for an exclusive license to utilize the Technology. If
Bio-Products has not previously granted an exclusive option or
license to or received a written offer from a Third Party for that
country, Bio-Products shall grant Licensee an option for an
exclusive license for that country upon the payment of fifteen
thousand dollars ($15,000) per country (the "Option Fee"). Said
Option Fee shall be due and payable within thirty (30) days after
Bio-Products has informed Licensee in writing that said country is
available. Licensee acknowledges that the deadline for submission of
foreign patent applications based on the current PCT has expired,
therefore no patent protection can be provided to Licensee under the
current PCT. However, Licensee agrees to pay all fees and expenses,
including, but not limited to, maintenance fees incurred in the
prosecution of future patents as may be necessary or useful in the
countries licensed to Licensee under this Paragraph 2.4. Such option
for an exclusive license granted to Licensee pursuant to this
Paragraph 2.4(b) shall be for a term of three (3) years from the
date that the Option Fee is paid to Bio-Products; provided the
Licensee has also paid all fees and expenses for patent prosecution
incurred during the term of the option, and Licensee is in
compliance with all requirements under this Agreement for
exclusivity in the United States.
(c) At any time prior to the expiration of the term of an option for an
exclusive license to Licensee in any country under Paragraph 2.4
(b), the option may be converted to an exclusive license upon
payment by Licensee to Bio-Products of a license fee of eighty-five
thousand dollars ($85,000) per country, in addition to the above
Option Fee and any patent prosecution fees and expenses. Licensee
shall also continue to pay all fees and expenses, including, but not
limited to, maintenance fees incurred in the prosecution of patents
as may be necessary or useful in the country licensed to Licensee
under this Paragraph 2.4.
(d) For each country exclusively licensed to Licensee under Paragraph
2.4(c), the terms and conditions set forth elsewhere in this
Agreement shall apply and Licensee shall pay royalties, bonuses, and
fees to Bio-Products in accordance with Article III, excluding
Paragraph 3.1, and all waste processing facilities both in the
United States and outside the United States shall be combined on a
cumulative basis for purposes of calculating all payments due to
Bio-Products, unless another financial arrangement is mutually
agreed to by the Parties.
2.5 For each facility to be constructed and operated under this Agreement
by the Licensee, a Proposed Construction Notice, as defined in Article 1.6,
shall be prepared and submitted to Bio-Products for review and comment.
Bio-Products shall submit its comments in writing to the Licensee in a timely
manner, not to exceed ninety (90) days. The Licensee shall, at its discretion,
then grant a site-specific sub-license to a USA entity (the "Sub-Licensee"), if
any, that shall own and/or operate the facility. Such sub-license agreement
shall be subject to the approval of Bio-Products, which approval shall not be
unreasonably withheld and shall be deemed given if not provided within ninety
(90) days of written notice to Bio-Products as per the terms of Section 14.15
hereof.
ARTICLE III - FEES, ROYALTIES, AND OTHER CONSIDERATION
3.1 The Licensee shall pay to Bio-Products a one time Technology licensing
fee of Three Hundred Fifty Thousand Dollars ($350,000) for the USA. Bio-Products
acknowledges that it has received payment in full of this Technology licensing
fee.
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3.2 The Licensee shall pay to Bio-Products a royalty of fifty cents ($.50)
for every ton of waste received and processed utilizing the Technology, up to a
maximum of two thousand (2,000) tons per day of waste processed. The Licensee
shall pay to Bio-Products a royalty of one dollar ($1.00) for every ton of waste
received and processed in excess of two thousand tons per day up to a maximum of
ten thousand (10,000) tons per day of waste processed. The Licensee shall pay to
Bio-Products a royalty of one dollar and fifty cents ($1.50) for every ton of
waste received and processed in excess of ten thousand (10,000) tons per day.
The royalty payments shall become payable on the thirtieth (30th) day following
the end of the calendar month in which such amount becomes due and owing until
this Agreement or any extension thereof expires or is terminated. Bio-Products
agrees that no royalty shall be due and payable with respect to waste processed
at any facility until such facility has been in operation for thirty (30)
Operating Days, as defined in Paragraph 1.3 (the "Operational Date").
Bio-Products further agrees that no royalty shall be assessed on the first
facility until either the sale of the cellulosic product is confirmed by a
written agreement between the Licensee and a purchaser or the facility has
operated, producing and disposing of the cellulosic product, for more than
ninety (90) days after the Operational Date. Payment of said royalties shall be
by wire transfer of funds to a Bio-Products bank account or by cashier's check
or other bank certified negotiable instrument.
3.3 The Licensee shall pay to Bio-Products a bonus (the "Bonus") of two
and one half percent (2.5%) of the gross sales price in excess of ten dollars
($10.00) per ton for the cellulosic product from waste, including MSW, utilizing
the Technology. The Bonus shall become due and payable on the ninetieth (90th)
day following the end of the calendar quarter in which such recyclable product
sales are made until this Agreement or any extension thereof expires or is
terminated. The Bonus shall be paid by wire transfer of funds to a Bio-Products
bank account or by cashier's check or by other bank certified negotiable
instrument. The above notwithstanding, no Bonus shall be due and payable with
respect to the cellulosic product produced at the facility until the facility
reaches its Operational Date.
3.4
(a) As additional consideration and for their experience and know-how
regarding the Technology, the Licensee shall pay Bio-Products a monthly fee for
technical services. Such technical services shall initially be provided by Xxxx
and Xxxxxx who are employees of Bio-Products, and who agree to provide whatever
technical services are reasonably requested of them by Licensee. Payments to
Bio-Products for the technical services shall be ten thousand dollars ($10,000)
per month payable on or before the first (1st) business day of each month
beginning six (6) months from June 21, 2002. Payments for the technical services
of Bio-Products shall be increased to twenty thousand dollars ($20,000) per
month commencing on the first business day of the month following the Licensee's
initial down payment for the process vessels for construction of the Licensee's
first plant and continuing each month thereafter until the first facility
reaches its Operational Date.
(b) Following the Operational Date as defined above in 3.4(a) of
Licensee's first facility, and effective immediately, payments for the technical
services of Bio-Products shall be decreased to fifteen thousand dollars
($15,000) per month for the continued provision of technical services by
Bio-Products with respect to the construction of additional facilities or the
expansion of existing facilities. Licensee and Bio-Products shall enter into a
consulting agreement on terms mutually agreeable to both Parties for the
continued provision of technical services by Bio-Products with respect to the
construction of additional facilities or the expansion of existing facilities.
Licensee agrees that said consulting agreement shall be for five (5) years and
shall include a minimum of fifteen thousand dollars ($15,000) per month payable
to Bio-Products on the first (1st) business day of each month.
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(c) If at any time Bio-Products fails to undertake technical services
requested, then Licensee may cease all payments as set forth in this Paragraph
3.4, until such time as the failure to undertake the technical services
requested is remedied.
3.5 Additionally, with respect to the technical services provided by
Bio-Products, the Licensee shall either provide pre-paid expense accounts or
reimburse Bio-Products employees for the reasonable transportation, lodging,
food, and other expenses incurred by Bio-Products employees in the performance
of such technical services for the Licensee. In either case, itemized expense
reports and receipts shall be submitted to the Licensee by Bio-Products
employees within ten (10) business days of completion of travel or a specific
project in which expenses are incurred. The Licensee shall establish a travel
expense policy and procedure, which policy and procedure Bio-Products shall
adhere to unless the Parties agree, in writing, otherwise. Any reimbursement for
expenses shall be paid by the Licensee within ten (10) business days of receipt
of such expense reports submitted by Bio-Products employees.
3.6 The Licensee may enter into research and development contracts with
Bio-Products to use the UAH pilot plant and facilities that are unrelated to the
Technology, as defined herein, with Xxxx as the principal investigator, to be
defined from time to time in exchange for results and information, and
Bio-Products shall provide a royalty free unrestricted license to use said
results and information which are unrelated to the Technology at Licensee's
facilities for the period of this Agreement unless a separate agreement is
prepared and signed by both Parties. Such results and information which are
unrelated to the Technology, including but not limited to test results, notes,
and reports regarding the work performed as requested by the Licensee shall be
turned over to the Licensee by Xxxx within thirty (30) days of completion, and
all such results and information shall be considered as jointly owned by
Licensee and Bio-Products as provided in Article IV. Xxxx shall allow the
Licensee to visit the UAH pilot plant facility for any purposes, including
demonstrations, recyclable product production, and testing upon reasonable
notice by the Licensee and mutual agreement with Xxxx as to the dates and times.
Xxxx shall also provide training for the Licensee's employees to use the
licensed Technology at the UAH pilot plant. Xxxx shall be compensated at a rate
of five hundred dollars ($500.00) per day plus expenses for all pilot plant
operations. For demonstrations, recyclable product production, testing, and
training at the UAH pilot plant at the request of the Licensee, the Licensee
shall compensate Bio-Products and UAH for the expenses for such demonstration
and test runs as follows:
(a) For Each Series of Test Runs:
(i) Pilot Plant Preparation/Set up $500
(ii) Pilot Plant Clean-up/Shutdown $500
(b) For Each Test Run in a Series:
(i) Boiler Fuel/Water Treatment $200
(ii) Labor $800
(iii) Waste Disposal $100
(c) Follow up Costs:
(i) Small Sample Collection, Packaging & Storage $100
(ii) Large Sample Collection & Packaging $250
(iii) Dry Cellulose Product per ton $500
(iv) Shipping Containers & Shipping Costs Actual, plus 25%
(d) Additional expenses:
(i) Tractor Rental $100/day
(ii) Auto/Truck mileage for Laborers $0.40/mile
(iii) Truck towing mileage $0.80/mile
(iv) Local Lodging for Laborers $50/day
(v) Per Diem allowance for Laborers $25/day
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3.7 For the first facility to be sub-licensed under this Agreement, the
Licensee agrees that the facility design, equipment designs and specifications,
engineering firm, construction contractors and sub-contractors, and all facility
management and labor personnel must be approved by Bio-Products, which approval
shall not be unreasonably withheld. The Licensee also agrees to begin the
facility permitting, facility and equipment design, equipment selection, and
engineering for the first facility within six (6) months from the date of
execution of this Agreement and to begin placing orders for equipment and
construction site work within one (1) year from the date of approval of all
permitting, facility and equipment design, equipment selection, and engineering
for the first facility. Notwithstanding the foregoing, Licensee shall begin
placing orders for equipment and shall commence and diligently pursue
construction and completion of the first facility no later than thirty (30)
months from the effective date of this Agreement, which would be December 21,
2004.
3.8 Due to the proprietary nature of the process vessel design, the
Licensee agrees that Bio-Products shall maintain the exclusive right of vessel
manufacture, and the Licensee and its Sub-licensees shall purchase all required
vessels exclusively from Bio-Products. The purchase price shall be cost plus
fifteen percent (15%), not including shipping costs or taxes. All other
equipment required for construction and operation of waste processing and
recycling facilities utilizing the Technology may be purchased from other
vendors. The first two vessels are to be built to Bio-Products' specifications
in Mississippi and shipped to the requested locations. Shipping costs and
applicable taxes shall be itemized and included in the cost of vessels and shall
be invoiced to and paid by the Licensee. Thereafter, Bio-Products shall from
time to time seek the qualifications of and obtain cost quotations from
alternative vessel manufacturers to manufacture future process vessels as needed
such that the same may be provided to Licensee having equal or higher quality
than that established by Bio-Products from its Mississippi manufacturer and may
be transported by truck to the required facility at a cost equal to or less than
that established by Bio-Products from its Mississippi manufacturer including the
cost of shipping and taxes. Bio-Products shall provide a minimum of thirty (30)
days training for Licensee employees and a written operations and maintenance
manual for operating the process vessels. If future vessels are purchased at a
cost, excluding shipping costs and taxes, below the most recent purchase price,
Licensee agrees to pay Bio-Products an amount equal to twenty-five percent (25%)
of the cost savings. An example of the Bio-Products warranty for the process
vessels is attached as Exhibit F. Bio-Products agrees to work directly with an
Engineer, Procure, and Construct ("EPC") contractor chosen by Licensee regarding
the procurement of process vessels from Bio-Products manufactured by Mississippi
Tank Company or by qualified alternative vessel manufacturers for the
development of an EPC contract with Licensee for future process vessels as
needed by Licensee. Any such EPC contractor and any such alternative process
vessel manufacturer shall be required to sign a Bio-Products Confidentiality,
Non-Disclosure, and Non-Use Agreement.
3.9 In order to maintain the exclusivity of this Agreement, the Licensee
further agrees that, within six (6) months from the Operational Date of the
first facility, the Licensee shall begin the facility permitting, facility and
equipment design, equipment selection, and engineering for construction of one
or more facilities with a combined total of at least two thousand (2,000) tons
per day. Licensee further agrees that within six (6) months after Licensee has
obtained approval of permitting, facility and equipment design, equipment
selection, and engineering, the Licensee shall begin ordering equipment and
construction site work for the one or more facilities with a combined total of
at least two thousand (2,000) tons per day, unless prevented from doing so by a
regulatory or government agency, acts of God, acts of war, acts of terrorism,
strikes, and the like. The Licensee shall expand existing facilities and/or add
new facilities with design capacity for processing at least an average of an
additional two thousand (2,000) tons per day of MSW each year thereafter, unless
prevented from doing so by a regulatory or government agency. If Licensee fails
to perform as specified under this Paragraph 3.9 for two (2) consecutive years,
then this Agreement shall convert from an exclusive to a non-exclusive license.
9
3.10 The Licensee shall maintain all such books and records as are
necessary to accurately determine all amounts due and payable to Bio-Products,
Xxxx, and Malley under Paragraphs 3.2, 3.3, 3.4 and 3.5 of this Agreement, which
books and records the Licensee shall make reasonably available, upon the
submission of a written request from Bio-Products for inspection by Bio-Products
and/or its designated representative at a time mutually convenient to
Bio-Products and the Licensee. Bio-Products agrees to treat all such information
respecting Licensee's books and records as confidential.
3.11 All payments shall be paid to Bio-Products at the address set forth
in Paragraph 14.15 of this Agreement or as otherwise notified in writing by
Bio-Products.
ARTICLE IV - INVENTIONS AND DISCOVERIES
4.1 All rights, title, and interest in and to the Technology and all
patent applications and patents thereon or relating thereto as presently exist,
specifically United States Patent No. 6,306,248 and foreign patents filed prior
to April 22, 2004 on Patent Cooperation Treaty International Application No.
PCT/US01/50049 shall remain the sole and exclusive property of UAH. In addition,
future patents and patent applications, both foreign and domestic, with respect
to the existing Technology shall be applied for and prosecuted, and if received,
shall issue solely in Bio-Products' name (See Paragraph 2.7 of the UAH License,
attached hereto as Exhibit A).
4.2 All right, title and interest in and to all future inventions,
processes, enhancements, improvements and other discoveries made by
Bio-Products, or any person acting for and under the direction of Bio-Products
or the Licensee, or any other employees or consultants of Bio-Products or the
Licensee, relating specifically to the design, engineering, fabrication, and
operation of the process vessels required to utilize the Technology, whether or
not patentable, shall be owned exclusively by Bio-Products and licensed to
Licensee hereunder. All patent applications and patents thereon, foreign and
domestic, whether made by any of the Parties, or jointly by the Parties, or
jointly by at least one employee of each Party, shall be owned exclusively by
Bio-Products. Bio-Products shall add the names of Licensee's employees and
consultants that make substantive contributions to the development of such
patent applications as co-inventors. To the extent required to accomplish the
foregoing, the Licensee and/or its employees and consultants shall execute any
and all assignments of patents or other documents to Bio-Products, if required
for any such patents to issue in Bio-Products' name. Bio-Products shall provide
the Licensee with detailed information concerning all such related, future
inventions, processes, enhancements, improvements and other discoveries.
Bio-Products hereby grants to the Licensee an exclusive license in the USA,
subject to the same exclusions and conditions stated above in Paragraph 2.1, to
utilize all such future inventions, processes, enhancements, improvements and
other discoveries at no additional royalty or cost, except that the term of this
Agreement shall be automatically extended to the expiration date of any
subsequently issued patent for each facility which utilizes such future
invention, process, enhancement or improvement. Any facility which does not
utilize such future invention, process, enhancement or improvement shall not be
subject to the extension of the term of this Agreement.
4.3 The Technology of Bio-Products and/or UAH shall be maintained by the
Licensee free and clear of all liens and encumbrances or rights of any Third
Party. Neither Bio-Products nor Licensee shall sub-license, encumber, transfer
or assign the Technology of Bio-Products and/or UAH without the written consent
of the other Party, except as provided in this Agreement.
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4.4 The provisions Paragraphs 4.1, 4.2, and 4.3 of this Article shall
apply to both foreign and domestic inventions, processes, enhancements,
improvements and other discoveries relating to the Technology, whether or not
patentable, and to all patent applications and patents related thereto.
4.5 All right, title and interest in and to all future inventions,
processes, enhancements, improvements and other discoveries made jointly by
Bio-Products and Licensee, or any person acting for and under the direction of
Bio-Products and Licensee, or any other employees or consultants of Bio-Products
and Licensee, relating to the use of the cellulosic product in any applications
not previously excluded in Paragraph 2.1 of this Agreement or any other
by-products obtained from the processing of MSW utilizing the Technology,
whether or not patentable, shall be owned jointly by Bio-Products and Licensee.
All patent applications and patents thereon, foreign and domestic, whether made
jointly by the Parties or jointly by at least one employee of each Party, shall
be jointly owned by Bio-Products and Licensee. The Parties shall add the names
of all employees and consultants that make substantive contributions to
development of such patent applications as co-inventors. To the extent required
to accomplish the foregoing, Bio-Products and Licensee and/or their respective
employees and consultants shall execute any and all assignments of patents or
other documents to Bio-Products and Licensee, if required for any such patents
to issue jointly in Bio-Products' and Licensee's names. Bio-Products and
Licensee shall share equally in the costs of patent preparation, application,
prosecution, and maintenance for all such jointly owned inventions The Parties
shall provide each other with detailed information concerning all such related,
future inventions, processes, enhancements, improvements and other discoveries.
Bio-Products and Licensee, as co-owners of any such jointly developed inventions
shall each have the full right to exploit such joint inventions with no
accounting to the other Party.
4.6 All inventions, processes, enhancements, improvements and other
discoveries developed by Licensee, its employees, and/or its consultants, not
including any Bio-Products employees or consultants performing technical
services for Licensee, regarding the use of the cellulosic product, or any other
by-product obtained from the processing of MSW utilizing the Technology, in any
applications not previously excluded by Paragraph 2.1 of this Agreement, whether
or not patentable, shall be owned exclusively by Licensee. All inventions,
processes, enhancements, improvements and other discoveries developed by
Licensee, its employees, and/or its consultants not related to the Technology,
whether or not patentable, shall be owned exclusively by Licensee.
4.7 All inventions, processes, enhancements, improvements and other
discoveries developed by Bio-Products, its employees, and/or its consultants,
other than those developed by Bio-Products while performing technical services
for Licensee, regarding the use of the cellulosic product or any other
by-product obtained from the processing of MSW utilizing the Technology, shall
be owned exclusively by Bio-Products and shall not constitute a part of the
Technology.
4.8 The Parties shall cooperate in good faith to protect any such
invention, process, enhancement, improvement or other discovery, and to make all
necessary applications, assignments, as provided herein, and filings, including
patents, industrial designs, copyright registrations, trademark registrations
and other legal protections, necessary or helpful to protect their interests
therein.
ARTICLE V - REPRESENTATIONS AND WARANTIES
OF BIO-PRODUCTS
Bio-Products hereby represents and warrants, as of the date hereof, as
follows:
5.1 Bio-Products is a corporation, duly organized, validly existing and in
good standing under the laws of Alabama. Bio-Products has all requisite power
and authority, corporate and otherwise, to execute, deliver, observe, and
perform its obligations under, this Agreement. The execution, delivery and
performance by Bio-Products of this Agreement have been duly authorized by all
necessary corporate action and does not and will not violate Bio-Products'
Articles of Incorporation or Bylaws or any provision of any agreement, law,
rule, regulation, order, writ, judgment, injunction, decree, determination, or
award presently in effect to which Bio-Products is a party or is subject.
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5.2 Bio-Products possesses all such franchises, licenses, patents, or
other rights necessary to enter into, and satisfy its obligations under, this
Agreement, without (to the best of Bio-Products' knowledge) any conflict with,
or infringement of, the franchises, licenses, patents or other rights of Third
Parties.
5.3 Bio-Products has the exclusive rights to grant some or all of its
rights or licenses to Third Parties to utilize the Technology not granted to the
Licensee under this Agreement in various geographical locations worldwide.
5.4 There is no action, suit, proceeding or claim pending or, to the
knowledge of Bio-Products, threatened against Bio-Products in any way relating
to the Technology. There is no action, suit, proceeding or claim pending or, to
the knowledge of Bio-Products, threatened against Bio-Products' properties,
assets or business which might have a materially adverse effect on Bio-Products'
rights or ability to perform this Agreement in accordance with its terms. No
investigation by any governmental agency is pending or threatened against
Bio-Products or the properties, business, or goodwill of Bio-Products, which has
or might have a materially adverse effect on Bio-Products' rights or ability to
perform this Agreement in accordance with its terms. There is no outstanding
order, writ, injunction, or decree of any court, government or governmental
agency against Bio-Products or its assets, business, or goodwill. Bio-Products
is not in violation of any law or governmental regulation applicable to it, to
the Technology, or to its properties or business, including but not limited to
any applicable safety, environmental control, or similar law or regulation.
5.5 There is no claim or demand of any Third Party pertaining to, or any
proceedings, which are pending or, to the knowledge of Bio-Products, threatened
which challenge the rights of Bio-Products in respect of any of the Technology.
No technology owned, licensed or used by Bio-Products is subject to any
outstanding order, decree, judgment, or stipulation by or with any court,
arbitrator or administrative agency, or, to the best of Bio-Products' knowledge,
infringes upon the rights of Third Parties.
5.6 As of the effective date of this Agreement Bio-Products has not, put
any Third Party on notice of, and is not a party to any suit alleging, any
infringement or alleged infringement of any of the Technology. Bio-Products is
aware that there are currently bases for putting certain Third Parties on notice
and/or filing claims, action, or litigation alleging infringement of the
Technology.
5.7 Bio-Products warrants the vessels pursuant to the warranty example
attached hereto as Appendix F. Bio-Products further warrants that if the
composition of the waste includes 70% pulp and paper material (by dry weight) to
be processed the system would yield 63% of the processed materials (by dry
weight) as the cellulosic biomass product.
ARTICLE VI - INDEMNITY AND INSURANCE
6.1 (a) The Licensee shall indemnify, defend and hold Bio-Products and
UAH and their respective directors, trustees, officers and
employees harmless from and against any and all claims and
expenses, including reasonable attorneys' fees and other legal
expenses, arising out of the death or injury of any person or
persons, any damage to property, or any other claim,
proceeding, demand, expense, or liability of any kind
whatsoever resulting from, or attributable to utilization of
the Technology (see Paragraph 10.3 below and Exhibit A).
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(b) At least ten (10) days prior to commencement of vessel
installation and operating activities on the site of each
facility of the Licensee to be constructed and utilize the
Technology pursuant to this Agreement, the Licensee or its
Sub-licensee shall provide to Bio-Products copies of
certificates evidencing the purchase of policies of insurance
against the liabilities described in Paragraph 6.1(a), naming
UAH and all of the Parties hereto as additional insureds, in
amounts not less than one million dollars ($1,000,000) per
claim.
(c) Bio-Products facilities in which the Licensee shall have no
financial interest, if any, shall provide indemnification and
insurance against the liabilities described in Paragraph 6.1
(a) and (b), naming UAH and all of the Parties hereto as
additional insureds, in amounts not less than one million
dollars ($1,000,000) per claim.
VII - INFRINGEMENT
7.1 (a) Bio-Products and UAH shall notify the Licensee, and the
Licensee shall notify Bio-Products and UAH, of any actual or
threatened infringement claims or suits that are or may be
brought or made against any Party to this Agreement relating
to the patents assigned to UAH (a "Third Party Patent Claim")
within five (5) days after learning of the existence thereof.
Bio-Products and/or UAH shall defend Licensee, at its or
their, as the case may be, cost and expense from and against
all infringement suits relating to any Third Party Patent
Claims. In connection with the defense by Bio-Products and/or
UAH of any Third Party Patent Claim, the Licensee, at the
request and expense of Bio-Products and/or UAH, shall take all
such reasonable actions as are necessary or desirable to
assist Bio-Products and/or UAH in any such action. Licensee
will be reimbursed by Bio-Products and/or UAH for its actual
and reasonable out-of-pocket expenses, including its
reasonable attorneys' fees, incurred as a result of such
action, within ninety (90) days of the receipt of invoice
thereof. Any recoveries or settlements resulting from any such
defenses pursuant to this Section 7.1(a) shall be (1) subject
to the approval of all Parties, and (2) shall be (i) first
applied to all Parties' actual and reasonable out-of-pocket
expenses incurred as a result of such defense, (ii) next
applied to the actual damages incurred by each respective
Party on a prorated basis, if any, and (iii) lastly, all
remaining recoveries shall be payable to Bio-Products and/or
UAH.
(b) Bio-Products shall notify the Licensee, and the Licensee shall
notify Bio-Products, of any actual or threatened infringement
claims or suits that are or may be brought or made against any
Party to this Agreement relating to the Technology as defined
herein and occurring within the USA that was not assigned to
UAH (a "Non-Patent Third Party Claim") within five (5) days
after learning of the existence thereof. Bio-Products shall
defend Licensee, at Bio-Products' cost and expense, from and
against all infringement suits relating to Non-Patent Third
Party Claims. In connection with the defense by Bio-Products
of any Non-Patent Third Party Claim, the Licensee, at the
request and expense of Bio-Products, shall take all such
reasonable actions as are necessary or desirable to assist
Bio-Products in any such action. Licensee will be reimbursed
by Bio-Products for its actual and reasonable out-of-pocket
expenses, including its reasonable attorneys fees incurred as
a result of such action within ninety (90) days of the receipt
of an invoice thereof. In the event of an unsuccessful outcome
of such suit, any actual and reasonable out-of-pocket expenses
of Licensee not already reimbursed by Bio-Products would be
deducted from future royalty payments payable to Bio-Products
at a rate of fifty percent (50%) of the amount due and payable
from each royalty payment until all such damages and
out-of-pocket expenses are fully recovered by Licensee. Any
recoveries or settlements resulting from any such defenses
pursuant to this Section 7.1(b) shall be (1) subject to the
approval of all parties, and (2) shall be (i) first applied to
all Parties' actual and reasonable out-of-pocket expenses
incurred as a result of such defense, (ii) next applied to the
actual damages incurred by each respective Party on a prorated
basis, if any, and (iii) lastly, all remaining recoveries
shall be payable to Bio-Products
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(c) Upon written notice of suspected infringement from Licensee,
UAH and/or Bio-Products shall have the right (but not the
obligation) to take enforcement action against or settle
infringement activity arising within the USA under any of the
patents or other intellectual property relating to the
Technology at their cost and expense. In any such action by
UAH and/or Bio-Products, the Licensee shall take all
reasonable actions as are necessary to assist UAH and/or
Bio-Products in any such action. If the Licensee is called
upon to take action in any way, which shall require it to make
available its own personnel or to retain counsel and/or
experts, UAH and/or Bio-Products shall reimburse the Licensee
for its actual and reasonable out-of-pocket expenses incurred
on account of the Licensee's counsel and experts within ninety
(90) days of the receipt of invoice thereof. Any recoveries or
settlements resulting from any such enforcement action or
other proceeding pursuant to this Section 7.1(c) shall be (1)
subject to the approval of all Parties, and (2) shall be (i)
first applied to all Parties' actual and reasonable
out-of-pocket expenses incurred as a result of such
enforcement action or other proceeding, (ii) next applied to
the actual damages incurred by each respective Party on a
prorated basis, if any, and (iii) lastly, in the event that
UAH elects to take the enforcement action, UAH will be
entitled to the remaining proceeds; however, in the event that
UAH declines to take the enforcement action but Bio-Products
elects to do so, all remaining recoveries shall be shared
equally between Bio-Products and License.
(d) In the event UAH and/or Bio Products elect not to bring or
maintain an action to prevent or stop an actual or threatened
infringement of the U.S. Patent after reasonable notice from
LICENSEE of such infringement or possible infringements,
LICENSEE shall have the right (but not the obligation) to
bring and maintain any appropriate suit, action or proceeding
involving any apparent or threatened infringement of the U.S.
Patent. LICENSEE shall be to entitled to deduct any and all
out-of-pocket costs it incurred for such proceedings from
future Royalty payments or other payments otherwise due to UAH
and/or Bio Products under this Agreement. However, LICENSEE
may not deduct more than fifty percent (50%) from the total
amount of any given future payment of Royalties or other
payments otherwise due to UAH and/or Bio Products under this
Agreement. If such Royalties or other payments in any year are
insufficient to reimburse LICENSEE for such costs, then
LICENSEE's right to reimbursement for such costs shall be
carried forward each year until LICENSEE has recovered the
amounts expended or incurred with respect to such enforcement
action and have recovered their out-of-pocket costs in respect
of such proceedings. UAH and/or Bio Products shall give
LICENSEE all authority (including the right to exclusive
control of the prosecution of the case), information and
assistance necessary to prosecute the case. If LICENSEE finds
it is necessary to join UAH and/or Bio Products in such suit,
action or proceeding. UAH and/or Bio Products shall execute
all papers and perform such other acts as may be reasonably
required. Should LICENSEE lack standing to bring any such
suit, action or proceeding then UAH and/or Bio Products shall,
at the request of LICENSEE, do so upon LICENSEE's undertaking
to indemnify and hold harmless UAH and/or Bio Products (to the
extent permitted by law) from all consequent liability and
promptly to reimburse UAH quarterly for all reasonable
expenses (including reasonable attorney's fees) resulting
there from. LICENSEE shall be entitled to select the counsel
that is to handle any action brought pursuant to this
Paragraph. Any recoveries or settlements resulting from any
such enforcement action or other proceeding pursuant to this
Section 7.1(d) shall be (1) subject to the approval of all
Parties, and (2) shall be (i) first applied to all Parties'
outstanding actual and reasonable out-of-pocket expenses
incurred as a result of such enforcement action or other
proceeding, (ii) next applied to the actual damages incurred
by Licensee, if any, and (iii) lastly, all remaining
recoveries shall be shared equally between Bio-Products and
Licensee.
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(e) In the event Bio Products elects not to bring or maintain an
action to prevent or stop an actual or threatened infringement
of the Technology that was not assigned to UAH (the
"Non-Patent Technology") after reasonable notice from LICENSEE
of such infringement or possible infringements, LICENSEE shall
have the right (but not the obligation) to bring and maintain
any appropriate suit, action or proceeding involving any
apparent or threatened infringement of the Non-Patent
Technology. LICENSEE shall be to entitled to deduct any and
all out-of-pocket costs it incurred for such proceedings from
future Royalty payments or other payments otherwise due to Bio
Products under this Agreement. However, LICENSEE may not
deduct more than fifty percent (50%) from the total amount of
any given future payment of Royalties or other payments
otherwise due to Bio Products under this Agreement. If such
Royalties or other payments in any year are insufficient to
reimburse LICENSEE for such costs, then LICENSEE's right to
reimbursement for such costs shall be carried forward each
year until LICENSEE has recovered the amounts expended or
incurred with respect to such enforcement action and have
recovered their out-of-pocket costs in respect of such
proceedings. Bio Products shall give LICENSEE all authority
(including the right to exclusive control of the prosecution
of the case), information and assistance necessary to
prosecute the case. If LICENSEE finds it is necessary to join
Bio Products in such suit, action or proceeding. Bio Products
shall execute all papers and perform such other acts as may be
reasonably required. Should LICENSEE lack standing to bring
any such suit, action or proceeding then Bio Products shall,
at the request of LICENSEE, do so upon LICENSEE's undertaking
to indemnify and hold harmless Bio Products (to the extent
permitted by law) from all consequent liability and promptly
to reimburse Bio Products quarterly for all reasonable
expenses (including reasonable attorney's fees) resulting
there from. LICENSEE shall be entitled to select the counsel
that is to handle any action brought pursuant to this
Paragraph. Any recoveries or settlements resulting from any
such enforcement action or other proceeding pursuant to this
Section 7.1(e) shall be (1) subject to the approval of all
Parties, and (2) shall be (i) first applied to all Parties'
outstanding actual and reasonable out-of-pocket expenses
incurred as a result of such enforcement action or other
proceeding, (ii) next applied to the actual damages incurred
by Licensee, if any, and (iii) lastly, all remaining
recoveries shall be shared equally between Bio-Products and
Licensee.
7.2 The Licensee shall at its own expense defend all infringement suits
relating to any variations, modifications and alterations of the Technology that
were made by the Licensee without the written acknowledgement and consent of
Bio-Products to make any such variations, modifications, and alterations of the
Technology. The Licensee shall not be entitled to any deduction from amounts due
Bio-Products on account of such expenses.
15
7.3 In connection with the defense by Bio-Products of any Third Party
claims not addressed in Paragraphs 7.1 or 7.2, the Licensee shall participate
and cooperate, as Bio-Products shall, from time to time, reasonably request. If
the Licensee is called upon to take action in a way which shall require it to
make available its own personnel or to retain counsel and/or experts, the
Licensee shall be entitled to a deduction from any amounts due Bio-Products
under this Agreement. If there are no such amounts due Bio-Products under this
Agreement, then Bio-Products agrees to pay Licensee all personnel, counsel,
expert and courts costs thirty days after notification of such expenses by the
Licensee in connection with Bio-Products' defense of such suits.
ARTICLE VIII - FABRICATION AND CONSTRUCTION
8.1 The Licensee shall use its best efforts to assure that all
construction and fabrication meets or exceeds all required safety standards of
the United States and the jurisdiction wherein the Technology shall be utilized.
8.2 Bio-Products will use its best efforts to assure that all designs,
processes, formulas, recipes, and plans to be provided to the Licensee meet or
exceed all applicable and material safety standards of the United States and any
jurisdiction wherein the Technology shall be utilized.
8.3 The Licensee shall use its best efforts to obtain, or cause to be
obtained, all material local, state and federal permits necessary for the
construction and operation of any facility that will utilize the Technology.
ARTICLE IX - CONFIDENTIALITY
9.1 The Parties hereto each possess confidential information of both a
technical and a non-technical nature. It is understood that it has been and may
be necessary for one to disclose same to the other, and the Parties agree such
disclosures have been and will be made under and subject to the following terms:
(a) Each Party agrees to receive and maintain in strict confidence the
confidential information disclosed to it by the other Party and
which is designated in writing as "CONFIDENTIAL" by the Party making
the disclosure. Such confidential information, either tangible or
intangible, shall not be used in any way other than for performance
of express provisions of this Agreement, and shall not be disclosed
to others without written consent of the designating, disclosing
Party.
(b) The obligations of confidentiality herein shall not apply to prevent
any Party hereto from using or otherwise disclosing any information,
tangible or intangible, which:
(i) it had rightfully in its possession before the disclosure
thereof by the disclosing Party;
(ii) is now in, or later comes into, the public domain through no
fault of the receiving Party; or
(iii) is disclosed to the receiving Party by a Third Party having
the right to make such a disclosure.
(c) The obligations of confidentiality herein shall extend beyond any
termination, cancellation or expiration of this Agreement and shall
include all such written information exchanged between the Parties.
(d) The information designated as "CONFIDENTIAL" shall be disclosed by
each Party only to those employees having a need to know same for
purposes of performing the express provisions of this Agreement, and
who shall in writing agree to be bound by the provisions of this
Paragraph 9.1.
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(e) The Parties to this Agreement shall take all necessary care to
maintain all "CONFIDENTIAL" information in strict confidence.
Disclosure to any Third Party shall be made only after said Third
Party has executed a "Confidentiality, Non-Disclosure, and
Non-Competition" agreement which is attached hereto as Exhibit G,
copies of which shall be maintained by the disclosing Party and
shall be subject to inspection by any of the Parties hereto.
(f) In the event that any Party hereto becomes legally compelled or
otherwise legally obligated to disclose any confidential information
disclosed to it by another Party, the compelled Party will provide
the other Party prompt notice so that the other Party may seek a
protective order or other appropriate remedy. Should the other Party
be unable on its own behalf to obtain such order or remedy, the
compelled Party will use its best efforts to obtain a protective
order or other appropriate remedy and if unable to do so will
consult (or will cause such person to whom such confidential
information was furnished to consult) with the other Party as to
what information should and should not be disclosed and will
disclose only that portion of the confidential information which is
legally required to be disclosed and will use its best efforts to
obtain assurances that treatment consistent with this paragraph will
be accorded to that portion of the confidential information so
disclosed. Except for expenses incurred as a result of any breach of
this Agreement relating to the disclosure of confidential
information, the other Party will reimburse the compelled Party for
its expenses incurred in complying with the terms of this Paragraph
9.1 (f).
(g) The Parties hereto agree to collect, obtain and deliver to each
other at the expiration or earlier termination of this Agreement,
all documents, models, drawings, plans, designs, specifications,
calculations, memoranda and other materials or records prepared in
the course of their performance and duties hereunder, except one
record set, which may be retained by each Party in accordance with
the provisions of this Paragraph 9.1.
ARTICLE X - AGREEMENT BETWEEN BIO-PRODUCTS AND UAH
10.1 Bio-Products shall comply with all of the terms and conditions of,
and perform all of its obligations under, the UAH License. Bio-Products shall
not agree to any amendment or modification of the UAH License that would
materially affect the terms and conditions of this Agreement without the written
consent of Licensee.
10.2 If at any time Bio-Products defaults in its duties in connection
with, or by its conduct attempts to or actually terminates the UAH License which
default and/or termination affects or terminates the ability of Bio-Products to
grant the license contained in this Agreement, then the Licensee will be
automatically entitled to and may at its sole discretion enter into contractual
agreements with and pay directly to UAH the amounts necessary to obtain or
maintain the UAH License. If Licensee does not enter into contractual agreements
with UAH, but rather cures any financial default of Bio-Products only, then such
sums paid to UAH on behalf of Bio-Products shall be deducted from any royalties
owed to Bio-Products under this Agreement. If no such royalties are owed to
Bio-Products under this Agreement then such sums will be treated as an interest
free loan to Bio-Products.
10.3 Any provision of this Agreement to the contrary notwithstanding, this
Agreement shall be construed and interpreted so that the terms and conditions
hereof shall not be inconsistent with the terms and conditions of the UAH
License, attached hereto as Exhibit A.
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ARTICLE XI - PUBLICITY OF LICENSE
11.1 Upon the request of the Licensee, Bio-Products shall cooperate and
provide assistance in the development of public statements, advertising, sales
literature or promotional materials to describe or promote the Technology.
ARTICLE XII - VISITS TO PREMISES
12.1 The Licensee shall, from time to time, permit Bio-Products to bring
visitors to tour any facility utilizing the Technology, provided, that
Bio-Products shall notify the Licensee at least seventy-two (72) hours in
advance of any proposed visit, that such visits shall be limited to reasonable
times and intervals, and contingent upon each visitor signing an appropriate
Confidentiality, Non-Disclosure and Non-Competition Agreement, and such visitors
shall also be subject to all relevant safety and other regulations that apply to
any other visitors to the facility. No persons other than those designated by
Bio-Products shall have the right to visit any facility utilizing the Technology
without the Licensee's express written consent.
ARTICLE XIII - EVENTS OF DEFAULT AND REMEDIES
13.1 The Licensee shall be in breach of this Agreement in the event of:
(a) The Licensee's failure to make any payment hereunder on or before
the date on which such payment becomes due and payable and the
continuation of such failure unremedied for thirty (30) days after
written notice thereof has been given to the Licensee by
Bio-Products;
(b) The Licensee's failure to observe or perform any covenant, condition
or agreement contained in this Agreement and the continuation of
such failure unremedied for thirty (30) days after written notice
thereof has been given to the Licensee by Bio-Products, unless such
breach can not be remedied within such thirty (30) days for reasons
beyond the Licensee's control, in which case the Licensee shall have
a reasonable time within which to remedy such breach; or
(c) Any warranty or representation made herein by the Licensee and
contained in this Agreement, shall prove to have been false,
misleading or incorrect in any material respect as of the date made,
or shall have failed to state a fact necessary in order to make the
statements made not misleading.
No termination of this Agreement shall relieve the Licensee of the
obligation to pay to Bio-Products all royalties, fees, and other payments
accrued at the time of the termination.
13.2 Bio-Products shall be in default of this Agreement in the event of:
(a) Bio-Products' failure to observe or perform any covenant, condition
or agreement contained in this Agreement or in the UAH License and
the continuation of such failure unremedied for thirty (30) days
after written notice thereof shall have been given to Bio-Products
by the Licensee;
(b) Any warranty or representation made herein by or on behalf of
Bio-Products, contained in this Agreement or in the UAH License,
shall prove to have been false, misleading or incorrect in any
material respect as of the date made, or shall have failed to state
a fact necessary in order to make the statements made not
misleading; or
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(c) If at any time Bio-Products defaults in its duties in connection
with, or by its conduct attempts to or actually terminates the UAH
License which default and/or termination affects or terminates the
ability of Bio-Products to grant the license contained in this
Agreement, or affects or terminates Licensee's ability to continue
operation of existing plants or build new plants.
13.3 The Licensee shall have the following remedies for breach or default
of this Agreement or the UAH License by Bio-Products:
(a) Upon Bio-Products' breach or termination of the UAH License or this
Agreement, such that the breach or termination has affected the
ability of Licensee to continue operation of existing plants and
preclusion of building new plants, the Licensee may at its option
terminate this Agreement and contract directly with UAH as provided
in this Agreement., The Licensee and any sub-licensee shall utilize
the Technology, free of any royalties, fees, and other amounts
accrued through the date of such default or breach and thereafter.
(b) In addition to any other right or remedy available to the Licensee
under this Agreement or in law or equity, upon Bio-Products' breach
or default of this Agreement or the UAH License, the Licensee shall
be entitled to withhold and/or offset any and all royalties or other
fees due to Bio-Products under this Agreement.
(c) Notwithstanding anything to the contrary in this Agreement, the
Licensee may terminate this Agreement at any time upon six (6)
months prior written notice to Bio-Products, at which time the
Licensee will cease utilizing the Technology, and pay to
Bio-Products any royalties, fees and other amounts accrued through
the date of such termination. Immediately upon termination of this
Agreement all rights, privileges and licenses granted to the
Licensee hereunder shall revert to Bio-Products, including all
sub-licenses of facilities granted by the Licensee.
13.4 Upon the Licensees' breach of this Agreement and it's failure to cure
said breach as provided above in 13.1, Bio-Products may, at its option, (i)
terminate this Agreement, at which time Licensee shall cease utilizing the
Technology and such termination shall relieve Licensee of its obligations to pay
Bio-Products any further royalties or fees other than those fees and royalties
already accrued through the date of termination and all sub-licenses granted by
Licensee shall be assigned to Bio-Products; or (ii) Bio-Products may seeks to
recover such damages to which it may be entitled by applicable law, including
but not limited to, equitable and injunctive relief.
13.5 (a) Any claim or controversy arising out of or relating to this
Agreement, or the breach thereof, including without limitation
the right of any Party hereto to terminate this Agreement,
shall be settled by binding arbitration administered by the
American Arbitration Association in accordance with its then
current Commercial Arbitration Rules, and judgment upon the
award rendered by the arbitrator may be entered in any court
having jurisdiction thereof. The arbitration shall be before
one neutral arbitrator to be selected in accordance with the
then current Commercial Arbitration Rules of the American
Arbitration Association. The parties shall have all rights to
pre-arbitration discovery pursuant to the Federal Code of
Civil Procedure.
(b) Neither of the Parties nor the arbitrator may disclose the
existence, content or results of any arbitration hereunder
without the prior written consent of the Parties except to
counsel, accountants, and other need to know professionals.
(c) All fees and expenses of the arbitration shall be born by the
Parties equally. However, each Party shall bear the expense of
its own counsel, experts, witnesses, and preparation and
presentation of proofs.
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(d) In the event that a claim or controversy over the right of any
Party to terminate this Agreement shall be submitted for
arbitration, this Agreement shall continue in full force and
effect, and the termination shall be of no effect, until the
arbitrator renders a final decision.
13.6 In the event of the commencement of a voluntary case under the
Bankruptcy Code by the Licensee, or Licensee's acquiescence in an involuntary
petition under the Bankruptcy Code which voluntary or involuntary case remains
undismissed for a period of ninety (90) days or more, the right and license
conferred under this Agreement shall automatically become and shall thereafter
be null and void. The commencement of a voluntary case under the Bankruptcy Code
by Bio-Products, or Bio-Products' acquiescence in an involuntary petition under
the Bankruptcy Code, which voluntary or involuntary case remains undismissed for
a period of ninety (90) days or more, shall be treated as a material breach of
the Agreement.
ARTICLE XIV - GENERAL PROVISIONS
14.1 The titles of the various articles and sections of this Agreement are
solely for convenience of reference and are not part of this Agreement for
purposes of interpreting the provisions hereof.
14.2 The Licensee may assign all of its rights and obligations under, and
all of its interest in, this Agreement, including without limitation the license
granted hereby, either (i) in a transaction accompanied by the sale or other
transfer of the Licensee's entire business, its stock, or substantially all of
its assets, or (ii) to any other entity owned by the same shareholders of
Licensee and this Agreement shall be binding upon, and inure to the benefit of,
any such successor or assign of the Licensee, provided that Bio-Products
consents in writing, such assignment shall not be unreasonably conditioned,
withheld, or delayed..
14.3 Nothing in this Agreement shall be deemed or construed to constitute
or to create a partnership, joint venture or agency between the Parties. Except
as may be otherwise provided herein, neither Party shall have any authority to
bind the other Party in any respect.
14.4 If any provision of this Agreement is or becomes unenforceable under
any law of mandatory application, it is the intent of the Parties hereto that
such provision will be deemed severed and omitted herefrom, the remaining
portions hereof to remain in full force and effect as written.
14.5 The waiver by any Party of any failure on the part of any other Party
to perform any of its obligations under this Agreement shall not be construed as
a waiver of any failure or continuing failure or failures, whether similar or
dissimilar thereto.
14.6 This Agreement, including the exhibits hereto, constitutes the entire
Agreement between the Parties with respect to the subject matter hereof and
supersedes all prior and contemporaneous agreements between the Parties, whether
oral or written, related to the subject matter hereof. This Agreement may be
amended or modified only by a written instrument executed by the authorized
representatives of the Parties hereto.
14.7 This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be a duplicate original, but all of which, taken
together, constitute a single document. This Agreement may be executed by each
Party on separate copies, which copies, when combined so as to include the
signatures of all Parties, shall constitute a single counterpart of this
Agreement.
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14.8 This Agreement shall be governed by and construed in accordance with
the laws of the State of Alabama.
14.9 Each Party to this Agreement shall execute all instruments and
documents and take all actions as may be reasonably required to effectuate this
Agreement.
14.10 For purposes of venue and jurisdiction, this Agreement shall be
deemed made and to be performed in the City of Huntsville, Alabama.
14.11 This Agreement and all exhibits contain the entire agreement between
the Parties to this Agreement with respect to the subject matter of this
Agreement, is intended as a final expression of such Parties' agreement with
respect to such terms as are included in this Agreement, is intended as a
complete and exclusive statement of the terms of such agreement, and supersedes
all negotiations, stipulations, understandings, agreements, representations and
warranties, if any, with respect to such subject matter, which precede or
accompany the execution of this Agreement.
14.12 Whenever the context so requires in this Agreement, all words used
in the singular shall be construed to have been used in the plural (and vice
versa), each gender shall be construed to include any other genders.
14.13 Subject to any restriction on transferability contained in this
Agreement, this Agreement shall be binding upon and shall inure to the benefit
of the successors-in-interest and permitted assigns of each Party to this
Agreement. Nothing in this Paragraph shall create any rights enforceable by any
Third Party that is not a Party to this Agreement, except for the rights of the
successors-in-interest and permitted assigns of each Party to this Agreement,
unless such rights are expressly granted in this Agreement to other specifically
identified Third Parties.
14.14 Except as otherwise provided in this Agreement, in the event any
litigation, arbitration, mediation, or other proceeding ("Proceeding") is
initiated by any Party against any other Party to enforce, interpret or
otherwise obtain judicial or quasi-judicial relief in connection with this
Agreement, the prevailing Party in such Proceeding shall be entitled to recover
from the unsuccessful Party all costs, expenses, and reasonable attorneys' fees
relating to or arising out of (a) such Proceeding (whether or not such
Proceeding proceeds to judgment), and (b) any post-judgment or post-award
proceeding including without limitation one to enforce any judgment or award
resulting from any such Proceeding. Any such judgment or award shall contain a
specific provision for the recovery of all such subsequently incurred costs,
expenses, and actual attorneys' fees.
14.15 Any notice or other communication pursuant to this Agreement shall
be sufficiently made or given five days after the date sent, postage pre-paid,
by certified mail, return receipt requested, if sent to the following addresses,
or to such other address as the Party may from time to time designate to the
other Parties in writing: In the case of Bio-Products:
Xx. Xxxxxxx X. Xxxx, President & CEO
BIO-PRODUCTS INTERNATIONAL, INC
0000 Xxxxxxxx Xxxx, XX
Xxxxxxxxxx, Xxxxxxx 00000 XXX
000-000-0000 (phone)
000-000-0000 (fax)
xxxxx@xxxxx.xxx.xxx (email)
In the case of World Waste Technologies, Inc.:
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Xxxxxx X. Xxxxxxx, CEO
WORLD WASTE TECHNOLOGIES, INC.
00000 Xxxxxxx Xxxxx Xx., Xxxxx
Xxxxx 000
Xxx Xxxxx, XX 00000
000-000-0000 (phone)
000-000-0000 (fax)
xxxxxxxx@xxxxxxxxxxxxxx.xxx (email)
Each Party shall make a reasonable, good faith effort to ensure that it will
accept or receive notices to it that are given in accordance with this
paragraph. A Party may change its address for purposes of this paragraph by
giving the other Parties written notice of a new address in the manner set forth
above.
14.16 In the event either Party hereto shall be rendered wholly or partly
unable to perform its obligations under this Agreement by reason of causes
beyond its control, including but not limited to acts of Nature, acts of
terrorism, acts, omissions, or regulation of any government or agency thereof,
judicial action, labor disputes, or transportation failure, except as specified
herein, the performance of the obligations of such Party insofar as it is
affected by such condition shall be suspended for the duration of such
condition, provided the Party affected advises the other Party of the basis of
its inability within ten (10) days of the beginning of such known inability.
After the cessation of the condition causing such inability, the Party suffering
such inability shall have a period of thirty (30) days to restore its
operation(s) and restore its obligations to the other Party.
14.17 No representations have been made to any Party regarding taxes, it
being understood by each of the Parties that each such Party accepts full
responsibility for calculation of and payment of his or its taxes, levies,
duties or other charges incurred or imposed as a consequence of this Agreement
and the transactions described herein.
14.18 This Agreement shall become effective when it has been executed by
all of the Parties to this Agreement.
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IN WITNESS WHEREOF, the Parties have caused their duly authorized
representatives to duly execute and deliver this Agreement effective as of the
date written above.
BIO-PRODUCTS INTERNATIONAL, INC.
By: /s/ Xxxxxxx X. Xxxx
----------------------------------------
Xx. Xxxxxxx X. Xxxx, President & CEO
WORLD WASTE TECHNOLOGIES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxx, CEO
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