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EXHIBIT 6.26
ROYALTY AGREEMENT
This ROYALTY AGREEMENT (the "Agreement") dated as of the 1st day of
July, 1997, is by and between Neutral Posture Ergonomics, Inc. located at 0000
X. Xxxxx Xxx., Xxxxx, Xxxxx 00000-0000 and Xx. Xxxxxx Xxxxxxxxx, 00000 Xxxxxx
Xxx., Xxxxxxx Xxxxxxx, Xxxxx 00000.
RECITALS
Xx. Xxxxxxxxx is a joint inventor of an invention which is disclosed and
claimed in United States Patent Application Serial Number 08/819,701, filed on
March 21, 1997, entitled "Apparatus for Housing and Transporting, and
Furnishing an Adjustable User-Platform for a Portable Computer" (the "Patent
Application"). Xx. Xxxxxxxxx has assigned all of his right, title and interest
in and to the Patent Application to Neutral Posture Ergonomics, Inc. in
exchange for the royalties payable pursuant to this Agreement.
DEFINITIONS
1. "Neutral Posture Ergonomics", a Texas Corporation, "Neutral Posture
Ergonomics, Inc.", or "NPE" shall mean Neutral Posture Ergonomics, Inc., its
successors and assigns, and any sublicensees and their successors and assigns.
2. "Patent Application" shall have the meaning set forth in the Recitals
of this Agreement.
3. "Net Sales Value" shall mean the invoice price less quality and cash
discounts thereon actually allowed but shall not include (i) sales or excise
taxes paid directly or indirectly by Neutral Posture Ergonomics, (ii) any
shipping costs actually paid and separately itemized by Neutral Posture
Ergonomics or (iii) normal and customary trade discounts, returns and
allowances actually allowed.
4. "Product" shall mean any device which would infringe one or more claims
of the patent or patents resulting under the Patent Application.
5. "Sold" shall mean a Product billed out, or shipped, or paid for,
whichever shall occur first.
REMUNERATION AND TERM
(A) Neutral Posture Ergonomics, Inc., shall pay Xx. Xxxxxxxxx a royalty
fee under the terms and conditions specified below to the earlier of (i) the
end of the term of any patent that issues arising from the Patent Application
(ii) the abandonment or failure to issue of the Patent Application and any
dependent patent applications or issued patents. The royalty shall be at a rate
of three percent (3%) of the Net Sales Value of Products Sold by Neutral
Posture Ergonomics.
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REPORTS AND AUDIT
(1) Neutral Posture Ergonomics shall keep full, true, and accurate
books of account containing all particulars which may be necessary for the
purpose of showing the amount payable to Xx. Xxxxxxxxx by way of royalty as
aforesaid. Said books of account shall be kept at Neutral Posture Ergonomics'
principal place of business. Said books and the supporting data shall be
opened upon reasonable prior notice, no more than twice during any calendar
year, during normal business hours at all reasonable times to the inspection of
an independent certified public accountant retained by Xx. Xxxxxxxxx for the
purpose of verifying Neutral Posture Ergonomics' royalty statements, or Neutral
Posture Ergonomics' compliance in other respects to this agreement. The
accountant shall only have the authority to report the amount of royalties that
should have been paid to Xx. Xxxxxxxxx during the period under inspection.
(2) Neutral Posture Ergonomics, within sixty (60) days after the
first day of January, April, July and October of each year shall deliver to Xx.
Xxxxxxxxx a true and accurate report, giving such particulars of the business
conducted by Neutral Posture Ergonomics during the preceding three (3) months
under this Agreement as are pertinent to an accounting for royalty under this
Agreement. These shall include at least the following:
(i) model numbers of each Product Sold;
(ii) quantity of each Product Sold;
(iii) unit prices;
(iv) gross xxxxxxxx;
(v) deductions, stating the basis for each deduction claimed;
and
(vi) royalty due Xx. Xxxxxxxxx.
Simultaneously with the delivery of each such report, Neutral Posture
Ergonomics shall pay to Xx. Xxxxxxxxx the royalty due for the period covered by
such report. If no royalties are due, it shall be so reported.
ARBITRATION
If any dispute arises with respect to the endorsement or interpretation
of the terms and conditions of this Agreement, such dispute shall not serve to
terminate this Agreement but shall instead be resolved by binding arbitration
upon thirty (30) days prior written notice in accordance with the notice
requirements of this Agreement, in accordance with the ten existing rules of
the American Arbitration Association. The award of the arbitrator shall be
confirmed as a judgement by any court having competent jurisdiction. This
Agreement shall be interpreted under the laws of the State of Texas and all
disputes shall be arbitrated in the City of College Station, Texas.
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MISCELLANEOUS
(1) This Agreement shall be governed by and construed in accordance
with the substantive laws of the State of Texas.
(2) This Agreement does not constitute a partnership, joint
venture or agency relationship between the parties.
(3) All notices and payments required or permitted to be given
hereunder must be in writing and shall be deemed effectively given when
received or, if not received, when deposited with the U.S. Post Office as U.S.
Certified mail, return receipt requested, addressed as follows:
To Neutral Posture Ergonomics: 0000 X. Xxxxx Xxx.
Xxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx
To Xx. Xxxxxxxxx: 00000 Xxxxxx Xxxxxx
Xxxxxxx Xxxxxxx, XX 00000
Each party shall give written notice to the other of any change in its address.
(4) No delay or omission by any party to exercise any right or
remedy under this Agreement shall be construed to be either acquiescence or the
waiver of the ability to exercise any right or remedy in the future.
(5) If any part of this Agreement is held to be invalid, illegal or
unenforceable, the remainder of the Agreement shall continue in effect.
(6) This Agreement shall be construed and interpreted in accordance
with the laws of the State of Texas and exclusive jurisdiction and venue for
all actions arising hereunder is agreed to be with the courts in Dallas, Texas.
(7) This Agreement shall be binding upon and inure to the benefit
of the successors, assigns and heirs of the parties.
(8) This Agreement supersedes any previous contract between the
parties and constitutes the entire agreement between them together with the
Assignment document by which Neutral Posture Ergonomics acquired Xx.
Xxxxxxxxx'x rights in the Patent Application. The parties acknowledge that any
statements or documents not specifically referenced or made a part of this
Agreement shall not have any effectiveness. This Agreement may not be changed
except by a written agreement signed by the parties hereto.
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EXECUTED at Bryan, Texas, on September 22, 1997
XX. XXXXXX XXXXXXXXX NEUTRAL POSTURE ERGONOMICS, INC.
/s/ XXXXXX X. XXXXXXXXX By: /s/ XXXXXXX XXXXXXX
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Date: September 22, 1997 Title: Chief Executive Officer
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Date: September 22, 1997
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