1
EXHIBIT 10.37
LICENSE AGREEMENT
THIS LICENSE AGREEMENT ("Agreement") is entered into as of this 31st
day of January, 1998 by and between SPECIALTY EQUIPMENT COMPANIES, INC., a
corporation organized and existing under the laws of the State of Delaware
("Licensor") and having its principal office at 0000 Xxxxxxxxx Xxxxxxxxx,
Xxxxxx, Xxxxxxxx 00000, and SPECIALTY EQUIPMENT MANUFACTURING CORPORATION, a
corporation organized and existing under the laws of the State of Delaware
("Licensee"), having its principal office at 0000 Xxxxxxxxx Xxxxxxxxx, Xxxxxx,
Xxxxxxxx 00000.
W I T N E S E T H:
WHEREAS, Licensor has undergone a corporate restructuring resulting in
Licensor being reconstituted principally as a holding company and Licensee being
organized to perform the manufacturing, sales and product development activities
performed heretofore by Licensor;
WHEREAS, Licensor is the owner of certain service marks, trademarks
and patents;
WHEREAS, Licensee wishes to acquire, and Licensor is willing to grant
to, Licensee the right to use certain of these service marks, trademarks and
patents in connection with Licensee's business (the business heretofore
performed by Licensor) under the terms and conditions described below;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
1. Grant of License. Licensor hereby grants to Licensee a world-wide,
non-exclusive non-transferrable license in the following intellectual property:
(a) the right to use the trademarks and service marks listed on Exhibit A
attached hereto (the "Licensed Marks"), (b) the right to use the patents listed
on Exhibit B attached hereto, including any subsequent improvements made thereto
by Licensee (the "Licensed Patents"), (c) the right to use any confidential,
technical, manufacturing or other information known to Licensor now or in the
future, which is significant to the subject matter of the Licensed Patents
("Know-How"); (d) the devices manufactured as described in or covered by any of
the Licensed Patents or Know-How ("Products"); and (e) the means and methods
described in or covered by any of the Licensed Patents or Know-How ("Methods",
collectively with the Licensed Marks, the Licensed Patents, the Know-How, the
Products and the Methods, the "Licensed Intellectual Property").
2. Compensation. Licensee agrees to pay to Licensor as compensation for
the license granted pursuant hereto the sum (i) 4% of the quarterly gross
receipts received by Licensee for any products sold which bear any of the
Licensed Marks and (ii) 4% of the quarterly gross receipts received by Licensee
from the Products manufactured by or on behalf of Licensee which are covered by
the Licensed Patents, the Know-How or the Methods. The percentages shown in the
preceding sentence shall be subject to adjustment as mutually agreed upon by the
parties after completion of a valuation study currently in progress. The
compensation payable hereunder shall be due and payable by Licensee on a
quarterly basis based on a calendar year.
3. Standards and Other Covenants. Licensee agrees that the standard of
services provided in connection with a Licensed Xxxx and the quality of products
bearing a Licensed Xxxx shall be at least equivalent to those adopted or used by
Licensor with respect to the Licensed Marks. To insure the maintenance of such
standards and quality, Licensor shall have the right to investigate, from time
to time upon two (2) business days advance written notice, the facilities,
operations and products of Licensee, and Licensee shall cooperate with Licensor
in making such investigations and shall make available to Licensor such samples,
books and records as Licensor shall reasonably request in connection with
Licensor's efforts to maintain such standards and quality. If, in the sole
discretion of Licensor, such standards or quality are not being maintained by
Licensee, Licensor may terminate this Agreement as provided in Section 5 hereof.
Licensee agrees that it shall xxxx or cause to be marked the
2
products manufactured or sold by it in the United States using the
Licensed Patents under this Agreement in accordance with the statutes of the
United States relating to the marking of patented articles.
4. Manufacture of Products. Licensee may engage third parties in the
development and manufacture of the Products. Licensee shall have the right to
disclose the Know-How to any such third party under written non-disclosure
agreements (to be in a form reasonably acceptable to Licensor) for use in
connection with the functions being performed by such third party. All such
disclosures are to be expressly agreed to by Licensor, and such agreement will
not be unreasonably withheld.
5. Termination. This Agreement shall become effective as of the date
first written above. The License granted hereunder, or any portion thereof,
shall terminate upon the occurrence of any of the following events:
(a) If Licensor's right to use all or any of the Licensed
Intellectual Property terminates, Licensee's rights
and privileges to use any such Licensed Intellectual
Property or any portion thereof shall likewise
terminate;
(b) If Licensee shall apply for or consent to the
appointment of a receiver, trustee or liquidator of
Licensee or of all or a substantial part of its
assets, liquidate such by itself, file a voluntary
petition in bankruptcy, be unable or admit in writing
its inability to pay its debts as they become due,
make a general assignment for the benefit of its
creditors, make a trust or mortgage for the benefit
of its creditors, file a petition or any answer
seeking reorganization or arrangement with creditors
or to take advantage of any insolvency law, file an
answer admitting the material allegations of a
petition filed against Licensee in any bankruptcy,
reorganization or insolvency proceedings, or if an
order, judgment or decree shall be entered by any
court of competent jurisdiction, on the application
of a creditor, adjudicating Licensee a bankrupt or
insolvent or approving a petition seeking
reorganization of Licensee or appointing a receiver,
trustee or liquidator of Licensee or of all or a
substantial part of its assets, and such order,
judgment or decree shall continue unstayed and in
effect for a period of 60 consecutive days from the
filing thereof, or shall take any action towards its
dissolution or termination;
(c) In the event Licensee does not maintain the standards
and quality of services and products specified in
Section 3, and fails to commence to improve such
standards and quality within 30 days after written
notice from Licensor or shall thereafter fail to
continue diligently to make such improvements until
the required standards and quality have been reached;
(d) If Licensee shall fail to make any payment required
hereunder when due and shall fail to cure such
default within seven (7) days after written notice
from Licensor; or
(e) If Licensee shall default under any of the other
provisions of this Agreement and shall fail to cure
such default within 30 days after written notice from
Licensor;
then upon the occurrence of any such event, this Agreement and all rights of
Licensee hereunder shall terminate immediately upon written notice by Licensor
to Licensee; provided, however, that the provisions of this Agreement with
respect to any actions required to be taken by Licensee upon such termination
shall continue in full force and effect and shall be enforceable by Licensor.
Notwithstanding the foregoing, Licensor shall not have the right to terminate
this Agreement for any default described in subsection (e) above if within the
30-day grace period provided, Licensee shall have commenced and shall diligently
pursue all actions necessary to cure such default. Upon termination of this
Agreement, Licensee further agrees to immediately discontinue all use of the
Licensed Intellectual Property and any terms or marks confusingly similar to any
of the Licensed Marks, to cooperate with Licensor or its appointed agent to
apply to the appropriate authorities to cancel any fictitious name or other
filing or registration, and, upon Licensee's request, to file such documents as
are required by the appropriate governmental, professional or regulatory body to
signify Licensee's consent to any and all uses of the
3
Licensed Intellectual Property by any other person or entity designated by
Licensor, and to destroy all printed materials owned by Licensee which bear any
Licensed Xxxx subject to the License.
6. Registration of Licensed Intellectual Property. Licensee agrees to
make all filings, to bring all proceedings and to take all other actions
necessary to preserve and protect the Licensed Intellectual Property from any
existing, potential or threatened infringement, abandonment, forfeiture or other
loss, to the extent that such Licensed Intellectual Property has been exposed to
any such danger by reason of Licensee's use thereof. Licensee shall be
responsible for all payments including without limitation payments of any
maintenance fees required to keep in force any of the Licensed Patents. Licensee
will also make all filings, bring all proceedings and take all other actions
necessary to secure any additional rights in the Licensed Intellectual Property
available by reason of Licensee's use thereof. In this connection, Licensee
agrees that Licensor may, in Licensor's sole discretion, join in any filing or
proceeding made or commenced by Licensee provided that Licensee agrees that all
such actions shall be taken at Licensee's own expense, and that it will
indemnify and save Licensor harmless from any liabilities or expenses incurred
or resulting therefrom. Licensor, on its part, agrees that it will make all
filings, bring all proceedings, and take all other actions necessary to protect
the Licensed Intellectual Property from any such danger, except with respect to
the filings, proceedings and actions which Licensee is obligated to make, bring
or take under the provisions of this Section 6, and which Licensor does not, in
its sole discretion, determine to pursue itself. In the event that any of the
Licensed Intellectual Property is threatened with infringement, abandonment,
forfeiture or other loss as a result of any actions, suits, conditions or
occurrences which are not clearly the sole responsibility of either Licensor or
Licensee hereunder, then Licensor and Licensee shall cooperate and join with
each other in taking all steps necessary to protect such Licensed Intellectual
Property, and all liabilities and expenses imposed or incurred shall be borne
equally by the two parties. In the event that either Licensor or Licensee shall
fail to fulfill its obligations under this Section 6, then the other party shall
have the right to make all filings, bring all proceedings and take any other
actions which it deems necessary or appropriate to accomplish the objectives
contemplated by this Section 6, and the defaulting party shall reimburse such
other party for all liabilities and expenses incurred in connection therewith,
and each party hereby appoints the other party as its attorney-in-fact to make
all such filings, bring all such proceedings and take all other actions, in its
name, place and stead, which such other party deems necessary or appropriate to
carry out the foregoing; the rights granted under this sentence shall be in
addition to any other remedies available to the parties under this Agreement.
7. Representations and Warranties of Licensor. Licensor represents and
warrants that it is the owner of the Licensed Intellectual Property and that no
other person has the right, power or authority to use the Licensed Intellectual
Property in the jurisdictions in which Licensee is hereby granted the right and
license to the Licensed Intellectual Property, and that to the best of
Licensor's knowledge no other person is using the Licensed Intellectual Property
in connection with the services and products discussed herein, and no other
person has the right or standing to prevent the use by Licensee of such Licensed
Intellectual Property in the manner and in the countries, territories and
possessions contemplated by this Agreement. Licensor also represents and
warrants that it has the right to disclose to Licensee the Know-How and that it
has or will fully disclose the Licensed Patents and Know-How to Licensee.
Licensee also represents and warrants that to its knowledge none of the Licensed
Patents are now being infringed nor aware of any conduct that may result in
infringement.
8. Ownership of Licensed Intellectual Property. Licensee acknowledges
that Licensor is the owner of the Licensed Intellectual Property (including any
improvements made thereto by Licensee), and of the goodwill pertaining thereto
and that any goodwill arising from Licensee's use of the Licensed Intellectual
Property shall inure to the benefit of and shall be the sole and exclusive
property of the Licensor and nothing herein shall constitute a transfer of any
goodwill now existing or hereafter created related to the Licensed Intellectual
Property. Licensee agrees, subject to the rights and privileges granted
hereunder, that the same shall remain the sole and exclusive property of
Licensor, and upon termination of all or any part of the rights and privileges
granted hereunder because of default by Licensee, or otherwise, Licensee will
immediately cease and desist from the use of the Licensed Intellectual Property
(including any improvements made thereto by Licensee). Upon such termination,
Licensee agrees that it will execute all documents and instruments, and make all
filings, necessary to assign and transfer to Licensor any and all of its rights
in the Licensed Intellectual Property (including any additional rights therein
secured by reason of Licensee's use thereof); and upon failure of Licensee to so
act, Licensor shall have the right to execute such documents and instruments,
and make such filings, on behalf of Licensee, and Licensee hereby appoints
Licensor its attorney-in-fact to execute all such documents and
4
instruments, and to make all such filings, and to take all
other steps necessary to effect such assignments and transfers in the name,
place and stead of Licensee.
9. Assignability. Except with the prior written consent of Licensor,
the license granted herein shall neither be assignable nor transferable in any
manner whatsoever, nor shall the Licensee have the right to grant any
sublicenses of any Licensed Intellectual Property, provided that Licensee shall
have the right to assign this Agreement in its entirety to the surviving
corporation in connection with any merger or consolidation of Licensee, or to
any corporation or other person or entity which shall acquire all or
substantially all of its assets without Licensor's consent.
10. Disclaimer of Agency. This Agreement shall not constitute Licensee
as the legal representative, partner or agent of Licensor, or joint venturer
with Licensor, nor shall Licensee have the right or authority to assume or
create any liability or any obligation of any kind, express or implied, against
or in the name of or on behalf of Licensor.
11. Notices. All notices, demands or requests which under the
provisions of this Agreement or otherwise may or must be given, shall be in
writing and shall be given or made by mailing the same by prepaid, registered or
certified mail to:
Licensor: Specialty Equipment Companies, Inc.
0000 Xxxxxxxxx Xxxxxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx XxXxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Licensee: Specialty Equipment Manufacturing Corporation
0000 Xxxxxxxxx Xxxxxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Any notice, demand or request given or made hereunder shall be deemed so given
or made when deposited in the United States mail. Any party may designate by
notice in writing a new or other address to which any such notice, demand or
request shall thereafter be given or made; such notice of new or other address
to become effective upon receipt.
12. Confidentiality. Licensee acknowledges that the Know-How is
confidential and secret and that necessary disclosures to others during the term
of this Agreement will be protected by Licensee. This protection will be
consistent with the treatment of other confidential disclosures made by Licensee
and will include where appropriate confidentiality agreements when Know-How is
disclosed to third parties. The foregoing obligations will not apply to any part
of the Know-How that is or becomes generally known through no fault of Licensee.
13. Miscellaneous.
(a) This Agreement shall be construed in accordance with
the laws of the State of Illinois.
(b) The headings of the sections of this Agreement are
for convenience only and shall not affect the
construction of this Agreement.
(c) The remedies granted hereunder are cumulative and are
not intended to be exclusive of any other remedies to
which either party may be lawfully entitled in case
of any breach or threatened breach of the terms and
provisions hereof.
5
(d) Any provision of this Agreement prohibited or
otherwise invalidated by law or by court decree shall
be ineffective to the extent of such prohibition or
invalidity, without in any way invalidating or
affecting the remaining provisions of this Agreement.
(e) This Agreement constitutes the entire agreement and
understanding between the parties hereto in
connection with the subject matter hereof between the
parties hereto and supersede all previous
negotiations, commitments and writings, and may not
be changed or modified in any manner, orally or
otherwise, except by an instrument in writing signed
by a duly authorized officer or representative of
each of the parties hereto.
(f) This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an
original, and said counterparts shall constitute one
and the same instrument which may be sufficiently
evidenced by the counterpart.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
LICENSOR:
SPECIALTY EQUIPMENT COMPANIES, INC.
a Delaware corporation
By:________________________________________
Its:______________________________
LICENSEE:
SPECIALTY EQUIPMENT MANUFACTURING CORPORATION
a Delaware corporation
By:________________________________________
Its:______________________________
6
EXHIBIT A
Licensed Marks
====================================================================================================================
Date of Registration with United
Description of States Patent and Trademark Office
Licensed Xxxx Registration Number
====================================================================================================================
====================================================================================================================
====================================================================================================================
[SEE ATTACHED LIST]
EXHIBIT B
Licensed Patents
====================================================================================================================
Date of Registration with United
Description of States Patent and Trademark Office
Xxxx Registration Number
====================================================================================================================
====================================================================================================================
====================================================================================================================
[SEE ATTACHED LIST]
