Option Agreement

EXHIBIT 10.6

Option Agreement

This Option Agreement (the “AGREEMENT’) is made between the BOARD OF REGENTS (“BOARD”), of the UNIVERSITY OF TEXAS SYSTEM (“SYSTEM”), an agency of the State of Texas, whose address is 000 Xxxx 0xx Xxxxxx, Xxxxxx, Xxxxx 00000, Centro de Investigacion en Materiales Avanzados, S.C. (“CIMAV”), whose address is Xxxxxx xx Xxxxxxxxx 000, 00000 Xxxxxxxxx, Xxxx. Mexico and Refinery Science Corp., previously known as Hydroconversion Inc (“OPTIONEE”), a Texas corporation, with its principal place of business at 000 X. Xxxxxxxxxx, Xx Xxxx, Xxxxx 00000

RECITALS

A. BOARD and CIMAV (collectively referred to herein as “LICENSOR”) owns certain PATENT RIGHTS and TECHNOLOGY RIGHTS which were developed at the University of Texas at El Paso (“UNIVERSITY”), a component institution of SYSTEM and at CIMAV.

B. LICENSOR desires to have PATENT RIGHTS and TECHNOLOGY RIGHTS developed and used for the benefit of OPTIONEE, the BOARD, CIMAV, INVENTORS, and the public as outlined in BOARD’S Intellectual Property Policy.

C. OPTIONEE wishes to obtain an option to negotiate and acquire a license from LICENSOR to practice PATENT RIGHTS and TECHNOLOGY RIGHTS and sell and distribute products derived therefrom.

D. LICENSOR on March 1, 2002 executed a Royalty Sharing Agreement whereby CIMAV agreed to have UNIVERSITY negotiate and manage a License Agreement for the PATENT RIGHTS defined below. For clarification this means all payments, amendments to or notifications required under this Agreement will be directed to and managed by UNIVERSITY.

NOW THEREFORE, in consideration of the mutual covenants and premises herein contained, the parties agree as follows:

1. EFFECTIVE DATE AND OPTION PERIOD

This AGREEMENT is effective as of September 15, 2004 (“EFFECTIVE DATE’) for a period of 24 months (the “OPTION PERIOD”).

2. DEFINITIONS

2.1 PATENT RIGHTS mean LICENSOR ‘S rights in information or discoveries covered by U.S. Patent# 10/819,893, filed April 7, 2004 (U.T. Component file reference number UTSE:092US), all corresponding foreign patent applications; and all re-examinations or extensions thereof.

2.2 TECHNOLOGY RIGHTS mean LICENSOR ‘S rights in any technical information, know-how, process, procedure, composition, method, formula, protocol, technique or data developed by Xx. Xxxxxxx Xxxxxxxxx, Xx. Xxxxxxx Xxxxxx, and Xx. Xxxxxx Xxxxxxx (“INVENTORS”) at UNIVERSITY and CIMAV prior to the EFFECTIVE DATE relating to “Molybdenum Sulfide/Carbide Catalysts” which are not covered by PATENT RIGHTS, but which are necessary for practicing the invention covered by PATENT RIGHTS.

2.3 LICENSED PRODUCT means any product which cannot be developed, manufactured, used or sold without utilizing PATENT RIGHTS or TECHNOLOGY RIGHTS.

3. WARRANTIES

3.1 Except for the rights, if any of the Government of the United States, as set forth below, BOARD hereby represents that it has the full right and power to enter into this AGREEMENT and to grant the exclusive option set forth in this AGREEMENT. LICENSOR makes no other warranties concerning its rights covered by this AGREEMENT. LICENSOR makes no expressed or implied warranty of merchantability or fitness for a particular purpose as to any LICENSED PRODUCT. LICENSOR makes no warranty or representation as to the validity or scope of the PATENT RIGHTS or that any LICENSED PRODUCT will be free from an infringement of patents of third parties, or that no third parties are in any way infringing PATENT RIGHTS

3.2 OPTIONEE understands that the PATENT RIGHTS and TECHNOLOGY RIGHTS may have been developed under a funding agreement with the Government of the United States of America and, if so, that the Government may have certain rights relative thereto. This AGREEMENT is explicitly made subject to the Government’s rights under any such agreement and any applicable law or regulation. To the extent that there is a conflict between any such agreement, applicable law or regulation and this AGREEMENT, the terms of such Government agreement, applicable law or regulation will prevail.

4. OPTION FOR EXCLUSIVE LICENSE

4.1 LICENSOR hereby grants OPTIONEE an exclusive option to acquire an exclusive, worldwide license to practice PATENT RIGHTS and TECHNOLOGY RIGHTS under terms set forth in the License Agreement attached as Attachment A.

4.2 OPTIONEE may exercise its option at any time during the OPTION PERIOD by delivering to UNIVERSITY three executed copies of the License Agreement in Attachment A.

5. TERMINATION

5.1 OPTIONEE may terminate this AGREEMENT by giving 30 days written notice to UNIVERSITY.

5.2 UNIVERSITY may terminate this AGREEMENT upon 30 days written notice to OPTIONEE if OPTIONEE breaches or defaults on its payments obligations under Article 6 herein or on its payment obligations (including, but not limited to, payment of patent expenses) as set forth in any related agreement between OPTIONEE and UNIVERSITY covering PATENT RIGHTS and/or TECHNOLOGY RIGHTS, unless, before the end of the 30 day period, OPTIONEE has cured the breach or default to the satisfaction of UNIVERSITY and so notifies UNIVERSITY in writing, stating the manner of the cure.

6. PAYMENT

6.1 In consideration for the option granted herein, OPTIONEE agrees to pay BOARD $2,500 within 30 days after the EFFECTIVE DATE.

6.2 All payments under this AGREEMENT are to be paid in U.S. dollars, checks payable to the order of UNIVERSITY and mailed to the address in Section 8.6.

7. CONFIDENTIAL INFORMATION

7.1 As soon as possible following the execution of this AGREEMENT, UNIVERSITY, through INVENTOR, will disclose all relevant Confidential Information as defined in Section 7.2 below, other information, and data relating to PATENT RIGHTS and TECHNOLOGY RIGHTS, to enable OPTIONEE to evaluate the potential commercial significance of the PATENT RIGHTS and TECHNOLOGY RIGHTS

7.2 In addition to the initial disclosure described in Section 7.1, the parties may disclose other Confidential Information to each other, from time to time, in connection with work contemplated under this AGREEMENT. All such information whether disclosed initially or during the OPTION PERIOD will be referred to as “Confidential Information.” Each party will use reasonable efforts to prevent the disclosure of any of the other party’s Confidential Information to third parties for a period of three (3) years from receipt thereof, provided that the recipient party’s obligation will not apply to information that:

a. is not disclosed in writing or reduced to writing and so marked with an appropriate confidentiality legend within thirty (30) days of disclosure;

b. is already in the recipient party’s possession at the time of disclosure thereof and not obtained directly or indirectly from the other, as proven by the receiving party’s written records;

c. is or later becomes published through no fault of the recipient party;

d. is lawfully acquired from a third party having no obligations of confidentiality to the disclosing party;

e. is independently developed by the recipient party; or

f. is required by law or regulation to be disclosed.

7.3 In the event that information is required to be disclosed under Section 7.2(f) above, the party required to make disclosure will notify the other to allow that party to assert whatever exclusions or exemptions may be available to it under such law or regulation.

8. GENERAL PROVISIONS

8.1 This AGREEMENT may not be assigned by OPTIONEE without the prior written consent of LICENSOR, which consent may not unreasonably be withheld. However, OPTIONEE may assign any and all of the rights granted to it pursuant to this AGREEMENT to a successor of all or substantially all of its business to which this AGREEMENT relates without the approval from or prior notice to LICENSOR through UNIVERSITY.

8.2 This AGREEMENT constitutes the entire and only agreement between the parties relating to an option to acquire a license, and all prior negotiations, representations, agreements and understandings are superseded hereby. No agreements altering or supplementing the terms hereof may be made except by written mutual agreement by the parties.

8.3 The relationship between LICENSOR and OPTIONEE is that of independent contractors LICENSOR and OPTIONEE are not joint ventures, partners, principal and agent, master and servant, employer or employee, and have no other relationship other than independent contracting parties. UNIVERSITY will have no power to bind or obligate OPTIONEE in any manner, other than as is expressly set forth in this AGREEMENT. Likewise OPTIONEE will have no power to bind or obligate LICENSOR in any manner, other than as is expressly set forth in this AGREEMENT,

8.4 If any prevision of this AGREEMENT is ultimately held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby.

8.5 Any delay in enforcing a party’s right under this AGREEMENT or any waiver as to a particular default or other matter will not constitute a waiver of such party’s rights to the future enforcement of its rights under this AGREEMENT, except only as to an express written and signed waiver to a specific matter for a specific period of time.

8.6 Any notice required by this AGREEMENT will be given by personal delivery (including delivery by reputable messenger services such as Federal Express) or by prepaid, first class, certified mail, return receipt requested, addressed to:

The University of Texas at El Paso

Office of Technology Transfer

Attention: Technology Transfer Manager

Xxxxxx Xxxx, Room 404

500W. University

Xx Xxxx, Xxxxx 00000

Ph: 915/000-0000

Fax: 915/000-0000

or in the case of OPTIONEE to:

Refinery Science Corp.

Attention: Xxxxx Xxxxxxx

Xxxxxx Xxxx, Room 410

500W. University

Xx Xxxx, Xxxxx 00000

Ph: 000-000-0000

or at such other addresses as may be given from time to time in accordance with the terms of this notice provision.

8.7 This AGREEMENT will be governed by, construed, and enforced in accordance with the internal laws of the State of Texas.

8.8 This Agreement may be signed in one or more counterparts (including faxed copies), each of which shall be deemed one and the same original.

IN WITNESS WHEREOF, the parties have caused this AGREEMENT to be executed by their duly authorized representatives.

BOARD OF REGENTS OF THE UNIVERSITY OF TEXAS SYSTEM		REFINERY SCIENCE CORP.

By		By
	Xxxxxxx Xxxxxxxx Villa, Vice President for Finance and Administration		David, Rendina, CEO

			Date: ___________________________

Date: ____________________________

CENTRO DE INVESTIGATCION EN MATERIALES AVANZADOS

By
	Xx. Xxxxx Xxxxxxxx-Xxxxxxxxx General Director

Date: ____________________________

Approved as to Content:

By
	Xx. Xxxxxxx Xxxxxxxx Vice Xxxxxxx for Research

Date: ____________________________

ATTACHMENT

PATENT LICENSE AGREEMENT

This Agreement is between the Board of Regents (“Board”) of The University of Texas System (“System”), an agency of the State of Texas, whose address is 000 Xxxx 0xx Xxxxxx, Xxxxxx, Xxxxx 00000, Centro de Investigacion en Materiales Avanzados, St. (“CIMAV”), whose address is Xxxxxx xx Xxxxxxxxx 000, 00000 Xxxxxxxxx, Xxxx. Mexico and Refinery Science Corp., a corporation having a principal place of business located at 000 X. Xxxxxxxxxx, Xx Xxxx Xxxxx (“Licensee”).

TABLE OF CONTENTS

	RECITALS

1.	EFFECTIVE DATE	8

2.	DEFINITIONS	8

3.	WARRANTY, SUPERIOR RIGHTS AND REPRESENTATIONS	9

4.	LICENSE	10

5.	PAYMENTS AND REPORTS	11

6.	TERM AND TERMINATION	12

7.	INFRINGEMENT BY THIRD PARTIES	14

8.	ASSIGNMENT	14

9.	PATENT MARKING	14

10.	INDEMNIFICATION AND INSURANCE	14

11.	USE OF BOARD AND COMPONENT’S NAME	15

12.	CONFIDENTIAL INFORMATION AND PUBLICATION	15

13.	PATENTS AND INVENTIONS	16

14.	ALTERNATE DISPUTE RESOLUTION	16

15.	GENERAL	17

	SIGNATURES	18

RECITALS

A. Board and CIMAV (Collectively referred to herein as “Licensor”) own certain Patent Rights and Technology Rights related to Licensed Subject Matter, which were developed at The University of Texas at El Paso (“University”), a component institution of System and CIMAV.

B. Licensor desires to have the Licensed Subject Matter developed and used for the benefit of Licensee, Inventor, Board, CIMAV and the public as outlined in Board’s Intellectual Property Policy.

C. Board and CIMAV have executed a Royalty Sharing Agreement whereby CIMAV agrees to have University negotiate and manage the License Agreement for the Patent Rights defined below. For clarification this means all royalty payments and license tees, amendments to the Agreement, or notifications required under this Agreement will be directed to and managed by University.

D. Licensee wishes to obtain a license from Licensor to practice Licensed Subject Matter.

NOW, THEREFORE, in consideration of the mutual covenants and premises herein contained, the parties agree as follows:

1. EFFECTIVE DATE

This Agreement is effective _______________ (“Effective Date”).

2. DEFINITIONS

As used in this Agreement, the following terms have the meanings indicated:

2.1 “Affiliate” means any business entity more than 50% owned by Licensee, any business entity which owns more than 50% of Licensee, or any business entity that is more than 50% owned by a business entity that owns more than 50% of Licensee.

2.2 “Licensed Field” means all fields of use.

2.3 “Licensed Product” means any product Sold by Licensee comprising Licensed Subject Matter pursuant to this Agreement.

2.4 “Licensed Subject Matter” means inventions and discoveries covered by Patent Rights or Technology Rights within Licensed Field.

2.5 “Licensed Territory” means worldwide.

2.6 “Net Sales” means the gross revenues received by Licensee from the Sale of Licensed Products less sales and/or use taxes actually paid, import and/or export duties actually paid, outbound transportation prepaid or allowed, and amounts allowed or credited due to returns (not to exceed the original billing or invoice amount).

2.7 “Patent Rights” means Licensor’s rights in information or discoveries covered by patents, whether domestic or foreign, and all divisions, continuations, continuations-in-part, reissues, reexaminations or extensions thereof, and any letters patent that issue thereon, which name Xx. Xxxxxxx Xxxxxxxxx, Xx. Xxxxxxx Xxxxxx, and Xx. Xxxxxx Xxxxxxx as either sole or joint inventors (“Inventor) and which relate to the manufacture, use or sale of Patent No.10/819,893 entitled: “Molybdenum Sulfide/Carbide Catalysts”.

2.8 “Sale, Sell or Sold” means the transfer or disposition of a Licensed Product for value to a party other than Licensee.

2.9 “Technology Rights” means Licensor’s rights in technical information, knowfl how, processes, procedures, compositions, devices, methods, formulas, protocols, techniques, software, designs, drawings or data created by Xx. Xxxxxxx Xxxxxxxxx, Xx. Xxxxxxx Xxxxxx, and Xx. Xxxxxx Xxxxxxx (Inventor) at University and CIMAV before the Effective Date relating to Patent No.10/819,893 entitled:

“Molybdenum Sulfide/Carbide CataIysts’~ which are not covered by Patent Rights but which are necessary for practicing the invention covered by Patent Rights.

3. WARRANTY: SUPERIOR-RIGHTS

3.1 Except for the rights, if any, of the Government of the United States, as set forth below, Licensor represents and warrants its belief that (i) it is the owner of the entire right, tale, and interest in and to Licensed Subject Matter, (ii) it has the sole right to grant licenses thereunder, and (iii) it has not knowingly granted licenses thereunder to any other entity that would restrict rights granted to Licensee except as stated herein.

3.2 Licensee understands that the Licensed Subject Matter may have been developed under a funding agreement with the Government of the United States of America and, if so, that the Government may have certain rights relative thereto. This Agreement is explicitly made subject to the Government’s rights under any agreement and any applicable law or regulation. If there is a conflict between an agreement, applicable law or regulation and this Agreement, the terms of the Government agreement, applicable law or regulation shall prevail.

3.3 Licensee understands and acknowledges that Licensor, by this Agreement, makes no representation as to the operability or fitness for any use, safety, efficacy, ability to obtain regulatory approval, patentability, and/or breadth of the Licensed Subject Matter. Licenser, by this Agreement, also makes no representation as to whether there are any patents now held, or which will be held, by others or by Licensor in the Licensed Field, nor does Licensor make any representation that the inventions contained in Patent Rights do not infringe any other patents now held or that will be held by others or by Licensor,

3.4 Licensee, by execution hereof, acknowledges, covenants and agrees that it has not been induced in any way by CIMAV, Board, System, University or its employees to enter into this Agreement, and further warrants and represents that (i) it has conducted sufficient due diligence with respect to all items and issues pertaining to this Article 3 and all other matters pertaining to this Agreement; and (ii) Licensee has adequate knowledge and expertise, or has utilized knowledgeable and expert consultants, to adequately conduct the due diligence, and agrees to accept all risks inherent herein.

4. LICENSE

4.1 Licensor hereby grants to Licensee a royalty-bearing, exclusive license under Licensed Subject Matter to manufacture, have manufactured, and/or sell Licensed Products within the Licensed Territory for use within Licensed Field. This grant is subject to the payment by Licensee to Licensor through University of all consideration as provided herein, and is further subject to rights retained by Licensor to:

a. Publish the general scientific findings from research related to Licensed Subject Matter subject to the terms of Section 13, Confidential Information; and

b. Use Licensed Subject Mailer for research, teaching and other educationally-related purposes.

4.2 Licensee may extend the license granted herein to any Affiliate if the Affiliate consents to be bound by this Agreement to the same extent as Licensee.

4.3 Licensee may grant sublicenses consistent with this Agreement if Licensee is responsible for the operations of its sublicensees relevant to this Agreement as if the operations were carried out by Licensee, including the payment of royalties whether or not paid to Licensee by a sublicensee. Licensee must deliver to Licensor a true and correct copy of each sublicense granted by Licensee, and any modification or termination thereof, within 30 days after execution, modification, or termination. When this Agreement is terminated, all existing sublicenses granted by Licensee must be assigned to Licensor.

5. PAYMENTS AND REPORTS

5.1 In consideration of rights granted by Licensor to Licensee under this Agreement, Licensee will pay Licensor the following:

a. A nonrefundable license documentation fee in the amount of patent expenses incurred by Licensor for Patent No.10/819,893, and payable when this Agreement is executed by Licensee;

b. To clarify under 51 -a. any fees paid by Licensee under the Option to License Agreement will be subtracted from the license documentation fee.

c. A running royalty equal to 2.5% of Net Sales for Licensed Products sold by Licensee and protected by a valid claim included within Patent Rights.

5.2 In consideration of rights granted by Licensor to Licensee under this Agreement, Licensee further agrees to pay Licensor the following after the execution of a sublicense hereunder:

a. Within 30 days after the execution of the sublicense, a sublicense fee of 50% of any up-front cash payment made to Licensee in consideration of the sublicense, excluding funds paid to Licensee for research and development purposes;

b. Within 30 days after the execution of the sublicense, a sublicense fee constituting a cash payment equal to 50% of any non-cash consideration received by Licensee from a sublicensee, such consideration to include, without limitation, equity in other companies or equity investments in Licensee. The value of an equity investment will be calculated as the average market value of the class of stock involved for 5 consecutive days preceding the execution of the sublicense agreement. In cases where the sublicense agreement calls for payment to Licensee of a premium over the market value, Licensor will also share 10% of the premium paid to Licensee; and

c. One half of the gross revenue royalty payments received on Net Sales of Licensed Products received by Licensee from any sublicensee.

5.3 During the Term of this Agreement and for 1 year thereafter, Licensee agrees to keep complete and accurate records of its and its sublicensees’ Sales and Net Sales of Licensed Products under the license granted in this Agreement in sufficient detail to enable the royalties payable hereunder to be determined. Licensee agrees to permit Licensor or its representatives, at Licensor’s expense, to periodically examine its books, ledgers, and records during regular business hours for the purpose of and to the extent necessary to verify any report required under this Agreement. If the amounts due to Licensor are determined to have been underpaid by a percentage factor such as ten percent, Licensee will pay the cost of the examination and accrued interest at the highest allowable rate.

5.4 Within 60 days after March 31, June 30, September 30, and December 31, beginning immediately after the Effective Date, Licensee must deliver to Licensor a true and accurate written report, even if no payments are due Licensor, giving the particulars of the business conducted by Licensee and its sublicensee(s), if any exist, during the preceding 3 calendar months under this Agreement as are pertinent to calculating payments hereunder. This report will include at least:

a. the quantities of Licensed Subject Matter that it has produced;

b. the total Sales;

c. the calculation of royalties thereon; and

d. the total royalties computed and due Board,

Simultaneously with the delivery of each report, Licensee must pay to Licensor the amount, if any, due for the period of each report.

5.5 On or before each anniversary of the Effective Date, irrespective of having a first Sale or offer for Sale, Licensee must deliver to Licensor a written progress report as to Licensee’s (and any sublicensee^’s) efforts and accomplishments during the preceding year in diligently commercializing Licensed Subject Matter in the Licensed Territory and Licensee’s (and, if applicable, sublicensee’s) commercialization plans for the upcoming year.

5.6 All amounts payable here by Licensee must be paid in United States funds without deductions for taxes, assessments, fees, or charges of any kind. Checks must be payable to the University of Texas at El Paso, and sent to the Office of Technology Transfer, Xxxxxx Xxxx, Room 404, 000 X. Xxxxxxxxxx, Xx Xxxx, Xxxxx 00000.

5.7 Licensee must reimburse Licensor for all its out-of-pocket expenses thus far incurred in filing, prosecuting, enforcing and maintaining exclusively licensed Patent Rights and must pay all future expenses so long as and in the countries its license remains exclusive.

6. TERM AND TERMINATION

6.1 The term of this Agreement is from the Effective Date to the full end of the term or terms for which Patent Rights have not expired or, if only Technology Rights are licensed and no Patent Rights are applicable, for a term of 15 years.

6.2 Any time after 2 years from the Effective Date, Licensor and University have the right to terminate the exclusivity of this license in any national political jurisdiction in the Licensed Territory if Licensee, within 90 days after receiving written notice from University of intended termination of exclusivity, fails to provide written evidence satisfactory to University that Licensee or its sublicensees has commercialized or is actively attempting to commercialize a licensed invention in such jurisdiction(s).

6.3 Any time after 3 years from the Effective Date, Board and University have the right to terminate this license in any national political jurisdiction in the Licensed Territory if Licensee, within 90 days after receiving written notice from University of intended termination, fails to provide written evidence satisfactory to University that Licensee or its sublicensees has commercialized or is actively attempting to commercialize a licensed invention in such jurisdiction(s).

6.4 The following definitions apply to Article 6: (i) “Commercialize” means having Sales of Licensed Products in such jurisdiction; and (ii) “Active attempts to commercialize” means having Sales of Licensed Products or an effective, ongoing and active research, development, manufacturing, marketing or sales program as appropriate, directed toward obtaining regulatory approval, production or Sales of Licensed Products in any jurisdiction.

6.5 This Agreement will earlier terminate:

a. automatically if Licensee becomes bankrupt or insolvent and/or if the business of Licensee is placed in the hands of a receiver, assignee, or trustee, whether by voluntary act of Licensee or otherwise; or

b. upon 60 days written notice from University if Licensee breaches or defaults on its obligation to make payments (if any are due) or reports, in accordance with the terms of Article 5, unless, before the end of the 60 day period, Licensee has cured the default or breach and so notifies University, stating the manner of the cure; or

c. upon 90 days written notice if Licensee breaches or defaults on any other obligation under this Agreement, unless, before the end of the 90 day period, Licensee has cured the default or breach and so notifies University, stating the manner of the cure; or

d. at any time by mutual written agreement between Licensee, and Licensor, upon 180 days written notice to all parties and subject to any terms herein which survive termination; or

e. under the provisions of Paragraphs 6.2 if invoked.

6.6 If this Agreement is terminated for any cause:

a. nothing herein will be construed to release either party of any obligation matured prior to the effective date of the termination;

b. after the effective date of the termination, Licensee may sell all Licensed Products and parts therefore it has on hand at the date of termination, if it pays earned royalties thereon according to the terms of Article 5; and

c. Licensee will be bound by the provisions of Articles 10 (Indemnification), 11 (Use of Licensor and University’s Name), and 12 (Confidential Information) of this Agreement.

7. INFRINGEMENT BY THIRD PARTIES

7.1 Licensee, at its expense, will take all reasonable actions to enforce any patent exclusively licensed hereunder against infringement by third parties and it is entitled to retain recovery from such enforcement. Licensee must pay Licensor a royalty on any monetary recovery if the monetary recovery is for damages or a reasonable royalty in lieu thereof. If Licensee does not file suit against a substantial infringer of a patent within 8 months of knowledge thereof, then Licensor may enforce any patent licensed hereunder on behalf of itself and Licensee, Licensor retaining all recoveries from such enforcement.

7.2 In any infringement suit or dispute, the parties agree to cooperate fully with each other. At the request and expense of the party bringing suit, the other party will permit access to all relevant personnel, records, papers, information, samples, specimens, etc., during regular business hours.

8. ASSIGNMENT

Except in connection with the sale of substantially all of Licensee’s assets to a third party, this Agreement may not be assigned by Licensee without the prior written consent of Licensor, which will not be unreasonably withheld.

9. PATENT MARKING

Licensee must permanently and legibly xxxx all products and documentation manufactured or sold by it under this Agreement with a patent notice as may be permitted or required under Xxxxx 00, Xxxxxx Xxxxxx Code.

10. INDEMNIFICATION AND INSURANCE

10.1 Licensee agrees to hold harmless and indemnify CIMAV Board, System, University, its Regents, officers, employees and agents from and against any claims, demands, or causes of action whatsoever, including without limitation those arising on account of any injury or death of persons or damage to property caused by, or arising out of, or resulting from, the exercise or practice of the license granted hereunder by Licensee, its Affiliates or their officers, employees, agents or representatives.

10.2 In no event shall Licensor be liable for any indirect, special, consequential or punitive damages (including, without limitation, damages for loss of profits or expected savings or other economic losses, or for injury to persons or property) arising out of or in connection with this Agreement or its subject matter, regardless of whether Licensor knows or should know of the possibility of such damages. Licenser’s aggregate liability for all damages of any kind relating to this Agreement or its subject matter shall not exceed the amounts paid by Licensee to Licensor under this Agreement during the one year period preceding the date of the event which gave rise to the liability. The foregoing exclusions and limitations shall apply to all claims and actions of any kind, whether based on contract, tort (including, but not limited to, negligence), or any other grounds.

10.3 Insurance

a. Beginning at the time when any Licensed Subject Matter is being distributed or sold (including for the purpose of obtaining regulatory approvals) by Licensee or by a sublicensee, Licensee shall, at its sole cost and expense, procure and maintain commercial general liability insurance in amounts not less than $2~000,0O0 per incident and $2,000,000 annual aggregate, and Licensee shall use reasonable efforts to have the Board, System, University, its Regents, officers, employees and agents named as additional insureds. Such commercial general liability insurance shall provide (i) product liability coverage; (ii) broad form contractual liability coverage for Licensee’s indemnification under this Agreement; and (iii) coverage for litigation costs. The minimum amounts of insurance coverage required shall not be construed to create a limit of Licensee’s liability with respect to its indemnification under this Agreement,

b. Licensee shall provide Licensor with written evidence of such insurance upon Licensor’s request. Licensee shall provide Licensor with written notice of at least fifteen (15) days prior to the cancellation, non-renewal or material change in such insurance.

c. Licensee shall maintain such commercial general liability insurance beyond the expiration or termination of this Agreement during (i) the period that any Licensed Subject Matter developed pursuant to this Agreement is being commercial

distributed or sold by Licensee or by a sublicensee or agent of Licensee; and (ii) the five (5) year period immediately after such period.

11. USE OF LICENSOR’S AND UNIVERSITY’S NAME

Licensee may not use the name of CIMAV, University, System or Board without express written consent.

12. CONFIDENTIAL INFORMATION AND PUBLICATION

12.1 Licensor and Licensee each agree that all information contained in documents marked “confidential’ and forwarded to one by the other (I) be received in strict confidence, (ii) be used only for the purposes of this Agreement, and (iii) not be disclosed by the recipient party, its agents or employees without the prior written consent of the other party, except to the extent that the recipient party can establish competent written proof that such information:

a. was in the public domain at the time of disclosure;

b. later became part of the public domain through no act or omission of the recipient party, it’s employees, agents, successors or assigns;

c. was lawfully disclosed to the recipient party by a third party having the right to disclose it:

d. was already known by the recipient party at the time of disclosure;

e. was independently developed by the recipient; or

f. is required by law or regulation to be disclosed.

12.2 Each party’s obligation of confidence hereunder shall be fulfilled by using at least the same degree of care with the other party’s confidential information as it uses to protect its own confidential information. This obligation shall exist while this Agreement is in force and for a period of 3 years thereafter.

12.3 University and CIMAV will submit its manuscript for any proposed publication of research related to Licensed Subject Matter to Licensee at least 30 days before publication, and Licensee shall have the right to review and comment upon the publication in order to protect Licensee’s confidential information. Upon Licensee’s request, publication will be delayed up to 60 additional days to enable Licensee to secure adequate intellectual property protection of Licensee’s property that would be affected by the publication.

13. PATENTS AND INVENTIONS

13.1 If after consultation with Licensee, all parties agree that a patent application should be filed for Licensed Subject Matter, Licensor will prepare and file the appropriate patent applications, and Licensee will pay the cost of searching, preparing, filing, prosecuting and maintaining same. If Licensee notifies Licensor that it does not intend to pay the cost of an application, or if Licensee does not respond or make an effort to agree with Licensor on the disposition of rights in the subject invention, then Licensor may file an application at its own expense and Licensee will have no rights to the invention. Licensor will provide Licensee a copy of any patent application for which Licensee has paid the cost of filing, as well as copies of any documents received or filed with the respective patent office during the prosecution thereof.

14. ALTERNATE D1SPUTE RESOLUTION

14.1 Any dispute or controversy arising out of or relating to this Agreement, its construction or its actual or alleged breach will be decided by mediation. If the mediation does not result in a resolution of such dispute or controversy, it will be finally decided by an appropriate method of alternate dispute resolution, including without limitation, arbitration, conducted in the city of El Paso, Texas in accordance with the Commercial Dispute Resolution Procedures [xxxx://xxx. xxxx.xxx/xxxxx/xxxxxxxxxxxxxxx.xxxx] of the American Arbitration Association. The arbitration panel will include members knowledgeable in the evaluation of catalyst technology. Judgment upon the award rendered may be entered in the highest court or forum having jurisdiction, state or federal. The provisions of this Article 15 will not apply to decisions on the validity of patent claims or to any dispute or controversy as to which any treaty or law prohibits such arbitration. The decision of the arbitration must be sanctioned by a court of law having jurisdiction to be binding upon and enforceable by the parties.

15. GENERAL

15.1 This Agreement constitutes the entire and only agreement between the parties for Licensed Subject Matter and all other prior negotiations, representations, agreements, and understandings are superseded hereby. No agreements altering or supplementing the terms hereof may be made except by a written document signed by both parties.

15.2 Any notice required by this Agreement must be given by prepaid, first class, certified mail, return receipt requested and addressed to:

The University of Texas at El Paso

Office of Technology Transfer

Attention: Technology Transfer Manager

Xxxxxx Xxxx, Room 404

000 X. Xxxxxxxxxx

Xx Xxxx, Xxxxx 00000

Ph: 915/000-0000

Fax: 915/000-0000

or in the case of Licensee to:

Refinery Science Corporation

Attn: Xxxxx Xxxxxxx

Xxxxxx Xxxx, Room 410

000 X. Xxxxxxxxxx

Xx Xxxx, Xxxxx 00000

Phone 604/000-0000

or other addresses as may be given from time to time under the terms of this notice provision.

15.3 Licensee must comply with all applicable federal, state and local laws and regulations in connection with its activities pursuant to this Agreement

15.4 This Agreement will be construed and enforced in accordance with the laws of the United States of America and of the State of Texas.

15.5 Failure of Board to enforce a right under this Agreement will not act as a waiver of that right or the ability to later assert that right relative to the particular situation involved.

15.6 Headings are included herein for convenience only and shall not be used to construe this Agreement.

15.7 If any part of this Agreement is for any reason found to be unenforceable, all other parts nevertheless remain enforceable.

15.8 This Agreement may be signed in one or more counterparts (including faxed copies), each of which shall be deemed one and the same original.

IN WITNESS WHEREOF, parties hereto have caused their duly authorized representatives to execute this Agreement:

BOARD OF REGENTS OF THE UNIVERSITY OF TEXAS SYSTEM		REFINERY SCIENCE CORP.

By		By
	Xxxxxxx Xxxxxxxx Villa, Vice President for Finance and Administration		David, Rendina, CEO

			Date: ___________________________

Date: ____________________________

CENTRO DE INVESTIGATCION EN MATERIALES AVANZADOS

By

Name:

Date: ___________________________

Approved as to Content:

By
Name:	Xx. Xxxxxxx Xxxxxxxx Vice Xxxxxxx for Research

Date: ___________________________

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