NON-EXCLUSIVE LICENSE AGREEMENT
EXHIBIT
10.21
THIS
NON-EXCLUSIVE LICENSE AGREEMENT (this "Agreement") is entered into as of
September 18, 2003, by Medi-Hut Co., Inc., a Nevada, United States of America
corporation with offices at 0000 Xxxxxx Xxxxxxx, Xxxx Xxxxxxxx, Xxx Xxxxxx
00000, Xxxxxx Xxxxxx of America (“MHUT”), Coa International Ind, Inc., a
corporation organized and existing under the laws of the Republic of Korea
(“Korea”) with its registered office at 0xx
Xxxxx,
Xxxxx Xxxxxxxx, 00-0 Xxxxxxxxxx-Xxxx 0Xx, Xxxxx-Xx, Xxxxx, Xxxxx (“Coa”),
Medi-Hut Int’l (Mfg.) Co., Ltd., a corporation organized and existing under the
laws of the Republic of Korea with its principal offices at 4-1 Godeung-Ri,
Sojung-Myun, Yeonki-Kun, Chunchungnam-Do, Korea (“MHUT”) and Young-Xxx Xxxx
(“Shin”).
BACKGROUND
On
November 16, 2000 the parties entered into a Joint Venture Agreement (as the
same may be amended and/or restated from time to time, the “Joint Venture
Agreement”), for the manufacture in and the export of safety syringes from Korea
based upon MHUT’s patents and technology under the name MHI. MHUT desires to
license to MHI and MHI desires a license of certain patents and other technology
from MHUT.
NOW,
THEREFORE, in consideration of the mutual covenants, conditions and agreements
of this Agreement, the parties hereby agree as follows, effective as of the
Commencement Date (as defined below):
1. DEFINITIONS.
1.1 "Affiliate"
means any corporation or other entity that is directly or indirectly
controlling, controlled by or under the common control with a party hereto
for
so long as such control exists. For the purpose of this Agreement, "control"
shall mean the direct or indirect ownership of fifty percent (50%) or more
of
the outstanding shares or other voting rights of the subject entity to elect
directors, or if not meeting the preceding, any entity owned or controlled
by or
owning or controlling at the maximum control or ownership right permitted in
the
country where such entity exists.
1.2 "Licensee"
means a third party to whom MHUT has granted a license or sublicense under
the
MHUT Patents, to make, have made, import, use, sell, offer for sale or otherwise
exploit a Product. "Licensee" includes a third party to whom MHUT has granted
the right to distribute a Product.
1.3 "MHUT
Patents" means (i) U.S. Patent No’s 5,562,626 and U.S. Patent Application No.
090/488807, (ii) all patents claiming an invention related to, or based upon,
the MHUT Technology owned by MHUT or licensed to MHUT (to the extent MHUT may
grant a license or sublicense to such patent) with the right to grant
sublicenses; and (iii) all patents issued to MHUT claiming an invention based
upon or relating to the MHUT Technology, together with:
(a) any
patent applications filed by MHUT claiming the subject matter of the MHUT
Technology;
(b) any
divisionals, continuations, continuation-in-part applications, and continued
prosecution applications (and their relevant international equivalents) of
the
patent applications described in (a) above to the extent the claims are directed
to subject matter specifically described in such patent applications, and the
resulting patents;
(c) any
patents resulting from reissues, reexaminations, or extensions (and their
relevant international equivalents) of the patents described in (a) and (b);
and
(d) international
(non-United States) patent applications filed after the Commencement Date
claiming the subject matter of the MHUT Technology and the relevant
international equivalents to divisionals, continuations, continuation-in-part
applications and continued prosecution applications of such patent applications
and any patents resulting from reissues, reexaminations, or extensions of the
patents
1.4 "MHUT
Technology" means technological models, inventions, concepts, manufacturing
processes, design drawings (whether manual or electronic), design processes,
prototypes, molds, schematics, know-how, databases and documentation thereof,
trade secrets, technical information, specifications, drawings, records,
documentation, works of authorship or other creative works, ideas, knowledge,
data or the like relating to safety syringes which is owned by or licensed
to
MHUT (to the extent MHUT may grant a license or sublicense to such intellectual
property) as of the date hereof, including without limitation information useful
to the practice of the inventions claimed in the MHUT Patents.
1.5 "Net
Sales" means the amounts received by MHI for the use or sale of Products to
bona
fide independent third parties, less (i) normal and customary rebates, and
cash,
trade and quantity discounts; (ii) sales, use and/or other excise taxes or
duties; (iii) the actual cost of any packaging and shipping, including
insurance; and (iv) amounts actually allowed or credited due to defects,
returns, rejections, wholesale chargebacks or retroactive price
reductions.
1.6 "Products"
means any equipment, products, processes or methods covered by or that exploit
or make use of one or more claims under the MHUT Patents or that exploit or
make
use of the MHUT Technology.
1.7 "Quarterly
Period" shall be each three month period within a fiscal year that begins on
November 1 and ends on October 31.
1.8 "Territory"
shall mean the Republic of Korea.
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2. LICENSE
GRANTS.
2.1 MHUT
Patents.
Subject
to the provisions of Section 6, MHUT hereby grants MHI a non-exclusive license,
under the MHUT Patents, to make, manufacture and export to MHUT and/or MHUT’s
customers, as directed by MHUT, Products in the Territory, and to perform
processes and methods, that embody the inventions described in the MHUT Patents.
The license granted in this Section 2.1 shall be non-exclusive for the Territory
and shall be subject to the terms of the Joint Venture Agreement. MHI shall
not
have the right to issue sublicenses nor shall MHI have the right to sell
Products directly to third parties without first obtaining written permission
from MHUT.
2.2 MHUT
Technology.
Subject
to the provisions of Section 2.1 and 6, MHUT hereby grants MHI a non-exclusive
license to use, reproduce, translate, otherwise exploit the MHUT Technology
solely in connection with MHI’s actions pursuant to the license granted in
Section 2.1.
2.3 No
Additional Rights.
Nothing
in this Agreement shall be construed to confer any rights upon either Coa,
MHI
or Shin by implication, estoppel, or otherwise as to any technology, or patent
(including such rights in improvements) owned by MHUT, regardless of whether
such technology or patent rights shall be dominant or subordinate to any MHUT
Patent or MHUT Technology.
3. CONSIDERATION.
3.1 Royalty
on Net Sales.
MHI
shall be required to receive written permission from MHUT prior to executing
any
sale of Product(s) to a third party in any territory or location. For any sale
to a third party that MHI receives permission from MHUT to execute, MHI shall
pay to MHUT a royalty to be negotiated in good faith based upon Net Sales of
Products. MHI shall not pay any royalty on sales of Products to
MHUT.
3.2 Computation
of Royalties.
All
sales of Products between MHUT and MHI will be disregarded for purposes of
computing Net Sales and royalties due MHUT under this Section 3, and in such
instances royalties will be payable only upon sales to, or other use by,
independent third parties. Nothing herein shall obligate MHI to pay MHUT
royalties more than once on any unit of a Product.
3.3 Sale
of Products to MHUT.
MHI will
sell Products to MHUT pursuant to a separate requirements contract and/or
purchase orders issued thereunder on mutually agreed terms.
4. PAYMENTS;
REPORTS AND RECORDS.
4.1 Timing
of Payments.
All
amounts due MHUT pursuant to Section 3 shall be paid within 30 days after the
last day of each Quarterly Period. Payment shall be made by wire transfer in
U.S. Dollars to an account designated by MHUT. All currency conversion shall
be
made at the exchange rate in effect at the time of payment; provided, however,
MHUT may direct MHI to make payment by other means or in other currency by
written notice.
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4.2 Royalty
Reports.
MHI
shall deliver to MHUT with each royalty payment a report setting forth the
total
Net Sales of the Products for the Quarterly Period and the computation of the
royalty amount. Such reports shall be confidential information of
MHI.
4.3 Inspection
of Books and Records.
Not
more than once in any 12 month period, MHUT may have MHI’s relevant books and
records for the prior 12-month period audited, by an independent certified
public accounting firm of MHUT’s choosing and reasonably acceptable to Coa, to
verify the accuracy of MHI’s royalty payments. The independent certified public
accounting firm must enter into a confidentiality agreement reasonably
acceptable to MHUT and Coa. Such audit must be conducted during MHI's normal
business hours in a manner that does not unduly interfere with MHI's normal
business activities. If any audit discloses underpayment of royalties, MHI
shall
promptly pay MHUT the royalties due plus interest at an annual rate of 6%.
MHUT
is responsible for all expenses it incurs in connection with any audit unless
the audit discloses an underpayment of royalties in excess of 10%, in which
case, MHI shall promptly reimburse MHUT for all of such audit
expenses.
4.4 Taxes.
All
royalty amounts required to be paid to MHUT pursuant to this Agreement may
be
paid with deduction for withholding for or on account of any taxes (other than
taxes imposed on or measured by net income) or similar governmental charge
by
the Republic of Korea ("Withholding Taxes"). At MHUT's request, MHI shall
provide MHUT a certificate evidencing payment of any Withholding Taxes hereunder
and shall reasonably assist MHUT to obtain the benefit of any applicable tax
treaty.
5. PATENT
PROSECUTION.
5.1 Responsibility
for Patent Rights.
MHUT
shall prepare, file, prosecute, and maintain all of the MHUT Patents. Coa and
Shin shall have reasonable opportunities to advise MHUT and shall cooperate
with
MHUT in such filing, prosecution and maintenance in the Republic of
Korea.
Upon
MHUT’s request and direction, MHI shall prepare, file, prosecute, and maintain
in the Republic of Korea any patents, patent applications, continuations,
continuations-in-part and divisionals having claims covering the subject matter
of the MHUT Patents and MHUT Technology. The attorney handling the filing,
prosecution, and maintenance of any such patent applications, etc. shall be
notified that MHUT is the owner of all patents, patent applications,
continuations, continuations-in-part and divisionals, that all prosecution
shall
be conducted in the best interests of MHUT, and that MHUT shall be copied on
all
correspondence.
5.2 Payment
of Expenses.
Payment
of all fees and costs, including attorney's fees, relating to the filing,
prosecution and maintenance of the MHUT Patents shall be the responsibility
of
MHUT.
5.3 Termination
of Rights.
Anytime
after the execution of this Agreement, MHUT may elect, on thirty (30) days
prior
written notice to MHI, Coa and Shin, not to continue paying patent fees and
costs incurred through such date of written notice, and MHUT may at its own
discretion continue or abandon any or all of the MHUT Patents for which such
payments have been discontinued.
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6. INFRINGEMENT.
6.1 Notification
of Infringement.
Coa,
MHI and Shin each agree to provide written notice to MHUT promptly after
becoming aware of any infringement of the MHUT Patents or MHUT
Technology.
6.2 Right
to Prosecute Infringements.
(a) MHI
Right to Prosecute.
So long
as MHI remains the sole licensee of the MHUT Patents and MHUT Technology in
the
Terrritory, MHI, to the extent permitted by law, shall have the right, under
its
own control and at its own expense, to prosecute any third party infringement
of
the MHUT Patents and/or MHUT Technology in the Territory, subject to Section
6.4. If required by law, MHUT shall permit any action under this Section 6.2
to
be brought in its name, including being joined as a party-plaintiff, provided
that MHI shall hold MHUT. harmless from, and indemnify MHUT against, any costs,
expenses, or liability that MHUT incurs in connection with such
action.
Prior
to
commencing any such action, MHI shall consult with MHUT and shall consider
the
views of MHUT regarding the advisability of the proposed action and its effect
on the public interest. MHI shall not enter into any settlement, consent
judgment, or other voluntary final disposition of any infringement action under
this Section 6.2 without the prior written consent of MHUT, which will not
be
materially withheld or delayed.
(b) MHUT
Right to Prosecute.
In the
event that MHI is unsuccessful in persuading the alleged infringer to desist
or
fails to have initiated an infringement action within a reasonable time after
MHI first becomes aware of the basis for such action, MHUT shall have the right,
at its sole discretion, to prosecute such infringement under its sole control
and at its sole expense, and any recovery obtained shall belong to MHUT. MHUT
will indemnify MHI for any order for costs that may be assessed against MHI
in
such proceedings.
6.3 Declaratory
Judgment Actions.
In the
event that a declaratory judgment action is brought against MHUT or MHI by
a
third party alleging invalidity or unenforceability of the MHUT Patents, MHUT,
at its option, shall have the right within twenty (20) days after commencement
of such action to take over the sole defense of the action at its own expense.
If MHUT does not exercise this right, MHI may take over the sole defense of
any
such action in the Territory at MHI’s sole expense, subject to Section
6.4.
6.4 Recovery.
Any
recovery obtained in an action brought by MHI under Sections 6.2 or 6.3 shall
be
distributed as follows: (i) each party shall be reimbursed for any expenses
incurred in the action, (ii) as to ordinary damages, MHI shall receive 100%
of
any award, and (iii) as to special or punitive damages (including any damages
in
excess of "single damages"), MHUT shall receive fifty percent (50%) and MHI
fifty percent (50%) of any award.
6.5 Cooperation.
Each
party agrees to cooperate in any action under this Section 6 which is controlled
by the other party, provided that the controlling party reimburses the
cooperating party promptly for any costs and expenses incurred by the
cooperating party in connection with providing such assistance.
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7. INDEMNIFICATION
AND INSURANCE.
7.1 Indemnification.
(a) Indemnity.
MHI
shall indemnify, defend, and hold harmless MHUT and its directors, officers,
employees, and agents and their respective successors, heirs and assigns (the
"Indemnitees"), against any liability, damage, loss, or expense (including
reasonable attorneys fees and expenses) incurred by or imposed upon any of
the
Indemnitees in the Republic of Korea in connection with any claims, suits,
actions, demands or judgments arising out of any theory of liability (including
without limitation actions in the form of tort, warranty, or strict liability
and regardless of whether such action has any factual basis) concerning any
product, process, or service that is made, used, sold, imported, or performed
by
MHI pursuant to any right or license granted under this Agreement.
(b) Procedures.
The
Indemnitees agree to provide MHI with prompt written notice of any claim, suit,
action, demand, or judgment for which indemnification is sought under this
Agreement. MHI agrees, at its own expense, to provide attorneys reasonably
acceptable to MHUT to defend against any such claim. The Indemnitees shall
cooperate fully with MHI in such defense and will permit MHI to conduct and
control such defense and the disposition of such claim, suit, or action
(including all decisions relative to litigation, appeal, and settlement);
provided, however, that any Indemnitee shall have the right to retain its own
counsel, at the expense of MHI, if representation of such Indemnitee by the
counsel retained by MHI would be inappropriate because of actual or potential
differences in the interests of such Indemnitee and any other party represented
by such counsel. Notwithstanding the above, MHI shall not be obligated to pay
the expenses of more than one additional counsel. MHI agrees to keep MHUT
informed of the progress in the defense and disposition of such claim and to
consult with MHUT with regard to any proposed settlement.
7.2 Insurance.
MHI
shall obtain and carry in full force and effect commercial general liability
insurance, including product liability and errors and omissions insurance which
shall protect MHI and Indemnitees with respect to events covered by Section
7.1(a) above. Such insurance (i) shall be issued by an insurer licensed to
practice in the Republic of Korea or an insurer pre-approved by MHUT, such
approval not to be unreasonably withheld, (ii) shall list MHUT as an additional
named insured thereunder, (iii) shall be endorsed to include product liability
coverage, and (iv) shall require thirty (30) days written notice to be given
to
MHUT prior to any cancellation or material change thereof. The limits of such
insurance shall not be less than One Million Dollars ($1,000,000) per occurrence
with an aggregate of Three Million Dollars ($3,000,000) for bodily injury
including death; One Million Dollars ($1,000,000) per occurrence with an
aggregate of Three Million Dollars ($3,000,000) for property damage; and One
Million Dollars ($1,000,000) per occurrence with an aggregate of Three Million
Dollars ($3,000,000) for errors and omissions. MHI shall provide MHUT with
Certificates of Insurance evidencing compliance with this Section 7. MHI shall
continue to maintain such insurance after the expiration or termination of
this
Agreement during any period in which MHI continues to make, use, or sell a
product that was a product under this Agreement, and thereafter for a period
of
five (5) years.
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8. NO
REPRESENTATIONS OR WARRANTIES
8.1 EXCEPT
AS
MAY OTHERWISE BE EXPRESSLY SET FORTH IN THIS AGREEMENT OR THE JOINT VENTURE
AGREEMENT, MHUT MAKES NO REPRESENTATIONS OR WARRANTIES OF ANY KIND CONCERNING
THE MHUT PATENTS AND MHUT TECHNOLOGY, EXPRESS OR IMPLIED, INCLUDING WITHOUT
LIMITATION WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NONINFRINGEMENT, VALIDITY OF PATENT CLAIMS, WHETHER ISSUED OR PENDING, AND
THE
ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE. Specifically,
and not to limit the foregoing, MHUT makes no warranty or representation (i)
regarding the validity or scope of the MHUT Patents, (ii) that the exploitation
of the MHUT Patents, MHUT Technology or any Product will not infringe any
patents, copyrights or other intellectual property rights of a third party,
and
(iii) that a third party is not currently infringing or will not infringe the
MHUT Patents or MHUT Technology.
8.2 Except
as
provided in Section 7.1 (a), IN NO EVENT SHALL MHUT, COA OR MHI, OR THEIR
DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS BE LIABLE TO THE OTHER PARTY FOR
INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING ECONOMIC DAMAGES
OR
INJURY TO PROPERTY AND LOST PROFITS, REGARDLESS OF WHETHER SUCH PARTY SHALL
BE
ADVISED, SHALL HAVE OTHER REASON TO KNOW, OR IN FACT SHALL KNOW OF THE
POSSIBILITY OF THE FOREGOING.
9. GENERAL
COMPLIANCE WITH LAWS
9.1 Export
Control.
With
regard to the MHUT Patents and MHUT Technology licensed hereunder, MHI, Coa
and
Shin shall comply with all Republic of Korea laws and regulations controlling
the export of certain commodities and technical data.
9.2 Marking
of Products.
To the
extent commercially feasible as consistent with prevailing business practices,
MHI shall xxxx all products that are manufactured or sold under this Agreement
with the number of each issued patent under the MHUT Patents that applies to
such Product.
10. TERM
This
Agreement shall commence (the date of such commencement being herein referred
to
as the "Commencement Date") upon the execution of this Agreement and will
continue in full force and effect until the expiration of the last to expire
of
the MHUT Patents; provided, however, that this Agreement is subject to earlier
termination pursuant to Section 11.
11. TERMINATION.
11.1 Voluntary
Termination.
Either
MHI or MHUT shall have the right to terminate this Agreement, for any reason,
(i) upon at least six (6) months prior written notice to the other party, such
notice to state the date at least six (6) months in the future upon which
termination is to be effective, and (ii) upon payment of all amounts due to
the
terminated party through such termination effective date.
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11.2 Cessation
of Business.
If MHI
ceases to carry on its business related to this Agreement due to insolvency,
bankruptcy, assignment for the benefit of creditors, dissolution liquidation
or
other similar action or cause, MHUT shall have the right to terminate this
Agreement immediately upon written notice to MHI, Coa and Shin.
11.3 Termination
for Default.
(a) Nonpayment.
In the
event MHI fails to pay any amounts due and payable to MHUT hereunder, and fails
to make such payments within thirty (30) days after receiving written notice
of
such failure, MHUT may terminate this Agreement immediately upon written notice
to MHI, Coa and Shin.
(b) Material
Breach.
In the
event MHI, Coa or Shin commits a material breach of its obligations under this
Agreement, the Joint Venture Agreement or any requirements contract or purchase
order for MHI’s sale of Products to MHUT, except for breach as described in
Section 11.3(a), and to cure that breach within thirty (30) days after receiving
written notice thereof, MHUT may terminate this Agreement immediately upon
written notice to MHI, Coa and Shin.
11.4 Effect
of Termination.
(a) The
following provisions shall survive the expiration or termination of this
Agreement: Sections 1, 4, 7, 8, 12, 13 and 14.
(b) Termination
of this Agreement shall not release MHI from its obligation to pay MHUT any
amounts that became due on or before the effective date of
termination.
12. DISPUTE
RESOLUTION.
12.1 Mandatory
Procedures.
The
parties agree that any dispute arising out of or relating to this Agreement
shall be resolved solely by means of the procedures set forth in this Section
12, and that such procedures constitute legally binding obligations that are
an
essential provision of this Agreement. If either party fails to observe the
procedures of this Section 12, as may be modified by their written agreement,
the other party may bring an action for specific performance of these procedures
in any court of competent jurisdiction.
12.2 Equitable
Remedies.
Although the procedures specified in this Section 12 are the sole and exclusive
procedures for the resolution of disputes arising out of or relating to this
Agreement, either party may seek a preliminary injunction or other provisional
equitable relief if, in its reasonable judgment, such action is necessary to
avoid irreparable harm to itself or to preserve its rights under this
Agreement.
12.3 Dispute
Resolution Procedures.
All
disputes, disagreements or questions which might arise between the parties
out
of or in connection with this Agreement, which cannot be amicably settled by
the
parties, shall be submitted to the International Chamber of Commerce (“ICC”) for
arbitration in accordance with the ICC Rules of Conciliation and Arbitration
in
effect at the time of arbitration. Arbitration shall take place in New York,
New
York, United States of America in the English language before a panel of three
arbitrators. The award or decision of the arbitrators shall be final and binding
upon the parties and shall be enforceable in any court having jurisdiction
over
the party against whom the award or decision was issued.
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12.4 Performance
to Continue.
Each
party shall continue to perform its undisputed obligations under this Agreement
pending final resolution of any dispute arising out of or relating to this
Agreement; provided, however, that a party may suspend performance of its
undisputed obligations during any period in which the other party fails or
refuses to perform its undisputed obligations. Nothing in this Section 12 is
intended to relieve MHI from its obligation to make undisputed payments pursuant
to Section 4 of this Agreement.
12.5 Statute
of Limitations.
The
parties agree that all applicable statutes of limitation and time-based defenses
(such as estoppel and laches) shall be tolled while the procedures set forth
in
Section 12.3(a) are pending. The parties shall cooperate in taking any actions
necessary to achieve this result.
13. INNOVATIONS
AND PROPRIETARY RIGHTS ASSIGNMENT
13.1 Proprietary
Information.
MHI,
Coa and Shin each acknowledge that this Agreement and the Joint Venture
Agreement create a relationship of confidence and trust by and between MHUT,
Coa, MHI and Shin with respect to any information:
(a) Applicable
to the business of MHI;
(b) Applicable
to the business of MHUT;
(c) Applicable
to the business of Coa; and
(d) Applicable
to the business of any client or customer of MHUT, Coa or MHI, which may be
made
known to or by any client or customer of MHUT, Coa or MHI, or learned by the
other party in such context during the term of this Agreement.
All
such
information has commercial value in the business in which the parties are
engaged and is hereinafter called "Proprietary Information." By way of
illustration, but not limitation, Proprietary Information includes any and
all
technical and non-technical information including patent, copyright, trade
secret, and proprietary information, techniques, sketches, drawings, models,
molds, inventions, know-how, processes, apparatus, equipment, and formulae
related to the current, future and proposed products of MHUT or Coa, and
includes, without limitation, respective information concerning research,
experimental work, development, design details and specifications, engineering,
financial information, procurement requirements, purchasing, manufacturing,
customer lists, business forecasts, sales and merchandising and marketing plans
and information. "Proprietary Information" also includes proprietary or
confidential information of any third party who may disclose such information
to
MHI in the course of MHI's business.
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13.2 Ownership
and Nondisclosure of Proprietary Information.
All
Proprietary Information is the sole property of the disclosing party, and its
respective assigns and customers; provided, however, that MHUT shall be the
sole
and exclusive owner of all patents, copyrights, molds, trade secrets and other
rights in the Proprietary Information arising in respect of, or related to,
the
MHUT Patents and/or MHUT Technology. MHI, Coa and Shin each hereby assigns
to
MHUT all rights, title and interest it may have or acquire in the Proprietary
Information arising in respect of, or related to, the MHUT Patents and/or MHUT
Technology. At all times, both during the term of this Agreement and after
termination of this Agreement, the parties will keep in confidence and trust
all
Proprietary Information, and will not use or disclose any Proprietary
Information or anything directly relating to Proprietary Information without
the
prior written consent of the owning party, except as may be necessary in the
ordinary course of performing duties pursuant to the terms of this
Agreement.
13.3 Ownership
and Return of Materials.
All
materials (including, without limitation, documents, drawings, apparatus,
sketches, designs, lists, and all other tangible media of expression) relating
to the MHUT Patents, MHUT Technology and/or Products furnished to MHI, Coa
and
Shin by MHUT shall remain the property of MHUT. Upon termination of this
Agreement, or at any time on the request of MHUT before termination, MHI, Coa
and Shin will promptly (but no later than five (5) days after the earlier of
such termination or MHUT’s request) destroy or deliver to MHUT, at MHUT’s
option, (a) all such materials furnished to MHI by MHUT, (b) all tangible media
of expression which are in MHI’s, Coa’s or Shin’s possession and which
incorporate any Proprietary Information of MHUT or otherwise relate to MHUT’s
business, and (c) written certification of MHI’s, Coa’s or Shin’s compliance
with their obligations under this sentence.
13.4 Innovations.
As used
in this Agreement, the term "Innovations" means all processes, machines,
manufactures, compositions of matter, improvements, inventions (whether or
not
protectable under patent laws), works of authorship, information fixed in any
tangible medium of expression (whether or not protectable under copyright laws),
moral rights, molds, trademarks, trade names, trade dress, trade secrets,
know-how, ideas (whether or not protectable under trade secret laws), and all
other subject matter protectable under patent, copyright, moral right, mask
work, trademark, trade secret or other intellectual property laws, and includes
without limitation all new or useful art, combinations, discoveries, formulae,
manufacturing techniques, technical developments, discoveries, artwork,
software, and designs. “Innovations” includes “Inventions,” which is defined to
mean any inventions protected under patent laws.
13.4.1 Disclosure
of Prior Innovations.
Identified on Exhibit A attached hereto are all Innovations, applicable to
the
business of Coa or Shin or relating in any way to the business of Coa or Shin
or
demonstrably anticipated research and development, which were conceived, reduced
to practice, created, derived, developed, or made by Coa or Shin prior to MHUT
entering in the Joint Venture Agreement in 2000 (collectively, the "Prior
Innovations"). Coa and Shin represents that such list is complete and that
it
has no rights in any such Innovations other than those Prior Innovations
specified in Exhibit A.
13.4.2 Assignment
of Innovations; License of Prior Innovations.
MHI,
Coa and Shin hereby agree promptly to disclose and describe to MHUT; and MHI,
Coa and Shin hereby do and will assign to MHUT or its designee the entire right,
title, and interest in and to, (a) each of the Innovations (including
Inventions), and any associated intellectual property rights, which MHI, Coa
or
Shin may solely or jointly conceive, reduce to practice, create, derive, develop
or make before or during the term of this Agreement, which relate, at the time
of conception, reduction to practice, creation, derivation, development, or
making of such Innovation, to the MHUT Patents, MHUT Technology, the Products
or
MHUT’s business or actual or demonstrably anticipated research or development
relating thereto, and (b) each of the Innovations which is not an Invention
(as
demonstrated by evidence meeting the clear and convincing standard of proof),
and any associated intellectual property rights, which MHI, Coa or Shin may
solely or jointly conceive, develop, reduce to practice, create, derive,
develop, or make before or during the term of this Agreement, which are
applicable to the MHUT Patents, MHUT Technology, the Products or MHUT’s business
(collectively, the Innovations identified in clauses (a) and (b) are hereinafter
the "MHUT Innovations"). To the extent any of the rights, title and interest
in
and to MHUT Innovations cannot be assigned by Coa, MHI and/or Shin, each of
MHI,
Coa and Shin hereby grant to MHUT an exclusive, royalty-free, transferable,
irrevocable, worldwide license (with rights to sublicense through multiple
tiers
of sublicensees) to practice such non-assignable rights, title and interest.
To
the extent any of the rights, title and interest in and to MHUT Innovations
can
be neither assigned nor licensed by Coa, MHI and/or Shin, each of MHI, Coa
and
Shin hereby irrevocably waive and agree never to assert such non-assignable
and
non-licensable rights, title and interest against MHUT or any of MHUT’s
successors in interest to such non-assignable and non-licensable rights. Coa,
MHI and Shin each hereby grant to MHUT or its designees a royalty free,
irrevocable, worldwide license (with rights to sublicense through multiple
tiers
of sublicensees) to practice all applicable patent, copyright, moral right,
mask
work, trade secret and other intellectual property rights relating to any Prior
Innovations which MHI incorporates, or permit to be incorporated, in the
Products and any MHUT Innovations.
-10-
13.4.3 Future
Innovations.
Coa,
MHI and Shin each recognize that Innovations or Proprietary Information relating
in any way to MHUT Patents, MHUT Technology and/or MHI activities under this
Agreement and conceived, reduced to practice, created, derived, developed,
or
made by MHI, Coa and/or Shin, alone or with others, within twelve (12) months
after termination of this Agreement shall be deemed to have been conceived,
reduced to practice, created, derived, developed, or made, as applicable, in
significant part based upon MHUT Proprietary Information and MHUT Innovations.
Accordingly, MHI, Coa and/or Shin agree that such Innovations and Proprietary
Information shall be presumed to have been conceived, reduced to practice,
created, derived, developed, or made, as applicable, during the term of this
Agreement and are to be promptly assigned to MHUT unless and until MHI, Coa
and/or Shin have established the contrary by written evidence satisfying the
clear and convincing standard of proof.
13.4.4 Cooperation
in Perfecting Rights to Proprietary Information and Innovations.
(a) MHI,
Coa
and/or Shin agree to perform, during and after the term of this Agreement,
all
acts deemed necessary or desirable by MHUT to permit and assist MHUT, at its
expense, in obtaining and enforcing the full benefits, enjoyment, rights and
title throughout the world in the Proprietary Information and MHUT Innovations
assigned or licensed to, or whose rights are irrevocably waived and shall not
be
asserted against, MHUT under this Agreement. Such acts may include, but are
not
limited to, execution of documents and assistance or cooperation (i) in the
filing, prosecution, registration, and memorialization of assignment of any
applicable patents, copyrights, mask work, or other applications, (ii) in the
enforcement of any applicable patents, copyrights, mask work, moral rights,
trade secrets, or other proprietary rights, and (iii) in other legal proceedings
related to the Proprietary Information or MHUT Innovations.
(b) In
the
event that MHUT is unable for any reason to secure execution by MHI, Coa and/or
Shin of any document required to file, prosecute, register, or memorialize
the
assignment of any patent, copyright, mask work or other applications or to
enforce any patent, copyright, mask work, moral right, trade secret or other
proprietary right under any MHUT Proprietary Information (including improvements
thereof) or any MHUT Innovations (including derivative works, improvements,
renewals, extensions, continuations, divisionals, continuations in part,
continuing patent applications, reissues, and reexaminations thereof), Coa,
MHI
and Shin each hereby irrevocably designate and appoint MHUT’s duly authorized
officers and agents as its agents and attorneys-in-fact to act for and on its
behalf (i) to execute, file, prosecute, register and memorialize the assignment
of any such application, (ii) to execute and file any documentation required
for
such enforcement, and (iii) to do all other lawfully permitted acts to further
the filing, prosecution, registration, memorialization of assignment, issuance,
and enforcement of patents, copyrights, molds, moral rights, trade secrets
or
other rights under the Proprietary Information, or MHUT Innovations, all with
the same legal force and effect as if executed by MHI, Coa or Shin, as the
case
may be.
(c) MHUT
agrees to designate Shin as the Inventor in any patent application for any
MHUT
Invention invented solely by Shin, MHI or Coa.
13.5 No
Violation of Rights of Third Parties.
Performance of all the terms of this Agreement by Coa, MHI and Shin does not
and
will not breach any agreement to keep in confidence proprietary information,
knowledge or data acquired by Coa or Shin prior to organization of MHI, and
neither Coa nor MHI nor Shin will disclose to MHUT, or induce MHUT to use,
any
confidential or proprietary information or material belonging to any other
party. Neither Coa nor MHI nor Shin is a party to any other agreement which
will
interfere with their respective full compliance with this Agreement. Coa, MHI
and Shin each agree not to enter into any agreement, whether written or oral,
in
conflict with the provisions of this Agreement.
13.6 Covenant
Not to Compete.
During
the term of this Agreement, and for a period of one (1) year following the
termination of this Agreement for any reason, in any country in which MHUT
does
more than nominal business, Coa, MHI and Shin each agree not engage, directly
or
indirectly, in the development or sale of products that compete against MHUT’s
Products in any country in which MHUT does business. Coa, MHI and Shin further
agree not to develop or assist others in developing products with the same
or
similar functionality to the Products developed or under development by MHUT
prior to and during the term of this Agreement. Coa, MHI and Shin each further
acknowledge and agree to the reasonableness of this covenant not to compete
and
the reasonableness of the geographic area and duration of time which are a
part
of said covenant.
-11-
13.7 No
Solicitation.
During
the term of this Agreement and for a period of one (1) year thereafter, Coa
and
Shin will not solicit, encourage, or cause others to solicit or encourage any
employees of MHUT to terminate their employment with MHUT.
13.8 Employee
Agreements.
Coa,
MHI and Shin shall cause each of their respective officers, directors,
employees, consultants and agents to enter into an agreement or contract by
which such officer, director, employee, consultant or agent agrees to make
such
assignments of Innovations or Inventions as are reasonably necessary to assure
that the provisions of this Section 13 of this Agreement are enforceable against
such officer, director, employee, consultant or agent in favor of
MHUT.
13.9 Sublicense
of Innovations.
In the
event MHUT sublicenses to any third party (i) any patented MHUT Innovation
solely invented by Shin, MHI or Coa, or (ii) any MHUT Innovation solely invented
by Shin, MHI or Coa that later becomes patented by MHUT, then MHUT shall pay
to
MHI reasonable compensation to be agreed upon by MHUT and MHI after negotiation
made in good faith.
14. MISCELLANEOUS
14.1 Notice.
Any
notices required or permitted under this Agreement shall be in writing, shall
specifically refer to this Agreement, and shall be sent by hand, recognized
national overnight courier, confirmed facsimile transmission, confirmed
electronic mail, or registered or certified mail, postage prepaid, return
receipt requested, to the following addresses or facsimile numbers of the
parties:
| If to Coa: |
Coa
International Ind, Inc.
|
| 0xx Xxxxx, Xxxxx Xxxxxxxx |
| 00-0 Xxxxxxxxxx-Xxxx 0Xx |
| Xxxxx-Xx Xxxxx |
| Xxxxx
Attention:
Representative Director
Telephone:
Facsimile:
|
-12-
| If to MHI: |
Medi-Hut
Int’l (Mfg.) Co., Ltd.
|
| 4-1
Godeung-Ri, Sojung-Myun
Yeonki-Kun
|
| Chunchungnam-Do,
Korea
Attention:
Representative Director
Telephone:
00-00-000-0000
Facsimile:
82-41-862-5700
|
| If to Shin: | Xx.
Xxxxx-Xxx Xxxx
2nd
Fl. Oyang X/X
00-0
Xxxxxxxxxx-Xxxx 0-Xx
Xxxxx-Xx,
Xxxxx
Telephone:
00-00-0000-0000
Facsimile:
00-00-0000-0000
|
| If to MHUT: | Medi-Hut
Co., Inc.
0000
Xxxxxx Xxxxxxx
Xxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Xxxxxx
Xxxxxx of America
Attention:
President
Telephone:
0-000-000-0000
Facsimile:
0-000-000-0000
|
| With a copy to: | Reitler
Xxxxx LLC
000
Xxxxx Xxxxxx
00xx
Xxxxx
Xxx
Xxxx, Xxx Xxxx 00000-0000
Xxxxxx
Xxxxxx of America
Attention:
Xxxxx Xxxxxxxxxx, Esq.
Telephone:
0-000-000-0000
Facsimile:
0-000-000-0000
|
| And with a copy to: | Kim,
Chang & Xxx
000
Xxxxxx-Xxxx
Xxxxxxx-Xx
Xxxxx,
Xxxxx
Attention:
Moon Han, Esq.
Telephone:
00-0-000-0000
Facsimile:
00-0-000-0000
|
All
notices under this Agreement shall be deemed effective upon receipt. A party
may
change its contact information immediately upon written notice to the other
party in the manner provided in this Section.
14.2 Governing
Law.
This
Agreement and all disputes arising out of or related to this Agreement, or
the
performance, enforcement, breach or termination hereof, and any remedies
relating thereto, shall be construed, governed, interpreted and applied in
accordance with the Federal laws of the United States of America and the laws
of
the State of New Jersey, without regard to conflict of laws principles, except
that questions affecting the construction and effect of any patent shall be
determined by the law of the country in which the patent shall have been
granted.
-13-
14.3 Force
Majeure.
A party
will not be responsible for delays resulting from causes beyond the reasonable
control of such party, including without limitation fire, explosion, terrorism,
quarantine, flood, war, strike, or riot, provided that the nonperforming party
uses commercially reasonable efforts to avoid or remove such causes of
nonperformance and continues performance under this Agreement with reasonable
dispatch whenever such causes are removed.
14.4 Amendment
and Waiver.
This
Agreement may be amended, supplemented, or otherwise modified only by means
of a
written instrument signed by all of the parties. Any waiver of any rights or
failure to act in a specific instance shall relate only to such instance and
shall not be, construed as an agreement to waive any rights or fail to act
in
any other instance, whether or not similar.
14.5 Severability.
In the
event that any provision of this Agreement shall be held invalid or
unenforceable for any reason, such invalidity or unenforceability shall not
affect any other provision of this Agreement, and the parties shall negotiate
in
good faith to modify the Agreement to preserve (to the extent possible) their
original intent. If the parties fail to reach a modified agreement within thirty
(30) days after the relevant provision is held invalid or unenforceable, then
the dispute shall be resolved in accordance with the procedures set forth in
Section 12. While the dispute is pending resolution, this Agreement shall be
construed as if such provision were deleted by agreement of the
parties.
14.6 Binding
Effect.
This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective permitted successors and assigns.
14.7 Headings.
All
headings are for convenience only and shall not affect the meaning of any
provision of this Agreement.
14.8 Entire
Agreement.
This
Agreement constitutes the entire agreement between the parties with respect
to
its subject matter and supersedes all prior agreements or understandings between
the parties relating to its subject matter.
14.9 Independent
Contractors.
The
relationship of the parties hereto is that of independent contractors. The
parties hereto are not deemed to be agents, partners or joint venturers of
the
others for any purpose as a result of this Agreement or the transactions
contemplated hereby.
14.10 Assignment.
MHI may
not assign this Agreement or its rights hereunder. Neither MHUT nor Coa nor
Shin
may assign this Agreement without the prior written consent of the other
parties, except that MHUT or Coa may assign this Agreement without such consent
to an entity that acquires all or substantially all of the business or assets
of
such party pertaining to the subject matter hereof, whether by merger,
reorganization, acquisition, sale or otherwise. Any other attempted assignment
of this Agreement will be void. Subject to the foregoing, this Agreement will
be
binding upon and inure to the benefit of the parties and their successors,
heirs
and assigns.
-14-
14.11 Partial
Invalidity.
If any
provision of this Agreement is held to be invalid by a court of competent
jurisdiction, then the remaining provisions will remain, nevertheless, in full
force and effect. The parties agree to renegotiate in good faith any provision
held invalid and to be bound by the mutually agreed substitute provision in
order to give the most approximate effect originally intended by the
parties.
14.12 English
Text.
The
English language version of this Agreement shall be the official version. Any
translation into Korean or any other language shall be unofficial and only
the
English language version shall be binding on the parties.
14.13 Waiver.
It is
agreed that no waiver by any party of any breach or default of any of the
covenants or agreements herein set forth will be deemed a waiver as to any
subsequent and/or similar breach or default.
14.14 Counterparts.
This
Agreement may be executed in counterparts, each of which will be deemed an
original and which together will constitute one instrument.
Signatures
on the following page
-15-
IN
WITNESS WHEREOF, the undersigned have executed this Agreement on the date first
above written.
MEDI-HUT
CO, INC.
By:
/s/
Xxxxx
X. XxXxxxx
Name:
Xxxxx X. XxXxxxx
Title:
President
COA
INTERNATIONAL IND INC.
By:
/s/
Young-Xxx Xxxx
Name:
Young-Xxx Xxxx
Title:
President
MEDI
HUT
INTERNATIONAL (MFG.) CO, LTD.
By:
/s/
Young-Xxx Xxxx
Name:
Young-Xxx Xxxx
Title: President
YOUNG-XXX
XXXX
By:
/s/
Young-Xxx Xxxx
Individually
-16-
Exhibit
A
Prior
Innovations
None
-17-
