License Agreement
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THIS LICENSE AGREEMENT (the "Agreement") is made and entered into as of
the 19th day of March 2002 by and between RTIN Holdings, Inc. (a Texas
Corporation), Safe Med Systems, Inc. (a Texas Corporation), and Safescript
Pharmacies, Inc. (a Texas Corporation) collectively referred to in this
Agreement as "RTNH" or "Licensor" and RxSystems, Inc. (a Nevada Corporation), on
the other hand, which is referred to in this Agreement as "RxSystems" or
"Licensee".
RECITALS
WHEREAS, RTNH is the owner of a perpetual license to utilize certain
intellectual property, including the entire right, title, knowledge, and
interest in and to applications for United States Patent currently pending,
along with all rights to the Safescript Pharmacies, including the knowledge,
procedures, and methods necessary to open and operate Safescript Pharmacies,
using the most advanced versions of RTNH's technology, all of which is referred
to in this Agreement as the "Applications"; and
WHEREAS, RxSystems desires to acquire a Perpetual License (the
"License"), as defined below, the exclusive right and license to the
Applications and the exclusive right and license to use, offer for sale and sell
sub-licenses of, products that are referred to in this Agreement as the
"Licensed Products" based on the methods and systems covered by the
Applications, any continuation, continuation-in-part or division of the
Applications, and any patents that issue on the Applications or any
Continuation, continuation-in-part or division of the Applications (the
"Patents"); and
WHEREAS, RTNH is willing to grant the License on the terms, provisions,
and conditions hereinafter set forth;
AGREEMENTS
NOW, THEREFORE, for consideration Twenty Five Thousand dollars
($25,000) previously delivered on February 1st, 2002, Fourteen Thousand dollars
($14,000) previously delivered on February 28th , 2002 and the Eleven Thousand
dollars ($11,000) delivered March 4, 2002, and the delivery of a promissory note
in the amount of Four Hundred Fifty Thousand dollars ($450,000) executed
simultaneously herewith, and One Hundred Thousand (100,000) shares of Series A
Preferred stock convertible into Four Million Five Hundred Thousand ($4,500,000)
worth of RxSystems common stock, valued at the average closing price of the
common stock as quoted by the NASD OTC-BB or any comparable exchange for the 30
trading days beginning January 1, 2003 and ending of February 11, 2003, and in
consideration of the mutual covenants, terms, and conditions hereinafter
expressed, and other good and valuable consideration, the receipt, adequacy, and
sufficiency of which are acknowledged, the parties to this Agreement agree as
follows:
ARTICLE X.
XXXXX OF MASTER LICENSE
A. In consideration of the amounts paid by RxSystems as described above to
RTNH, RTNH hereby grants to RxSystems, within RxSystems' territory, the
exclusive right and paid-up license to use and offer for sale, the
Applications and the Licensed Products based on the methods and systems
covered by the Applications, any continuation, continuation-in-part, or
division of the Applications, and any Patents that issue on the
Applications or any continuation, continuation-in-part, or division of
the Applications.
B. RTNH and RxSystems agree that the CMSA's identified via an asterisk on
Exhibit "A" hereto shall represent the territory granted to RxSystems
pursuant to this agreement.
ARTICLE II
FRANCHISE/LICENSE ROYALTIES
A. Licensee shall pay to Licensor Twenty Thousand dollars ($20,000) upon
the filing of each application for a license to operate a Safescript
Pharmacies, Inc. ("Safescript"). Licensee shall remit said fees within
15 days of the filing for any license. Additionally, Licensor shall be
entitled to a royalty of four percent (4%) of the gross revenue of each
store when received by Licensee. Licensee shall remit fees on the 15th
day of the next month after the month received.
ARTICLE III
DUTIES OF LICENSOR
A. Licensor shall train Licensee by opening the first four pharmacies to
be opened by the Licensee. Licensee will be responsible for all
reasonable expenses such as hotel and airfare. These will be reimbursed
according to the expense policies of RxSystems, but no later than
thirty (30) days after receipt by RxSystems of appropriate
documentation of the expense.
B. Licensor agrees to use its best efforts to keep the system up, running
and connected to all pharmacies and the RxSystems designated users at
all times. Licensor will provide reasonable redundancy satisfactory to
RxSystems so that in the event of a system failure the pharmacies do
not lose operating function. Satisfactory redundancy within the meaning
of this paragraph means downtime no longer than that guaranteed by
RTNH's vendors. RTNH agrees to reduce this requirement if it is able to
obtain shorter downtime guarantees from its providers. If for any
reason the Licensor causes or allows the system to fail so that
operating function of a designated user is lost, then the Licensor
shall be liable for resulting damages, including, but not limited to,
lost profits.
C. Licensor will make available to RxSystems the same knowledge,
procedures, methods, technology, software, systems and system
applications, and hardware that are available to and used by Safescript
in the operation of a pharmacy.
D. Licensor agrees to place in escrow a working copy of all software used
by Safe Med Systems, Inc. ("Safe Med Systems") and Safescript and to
place in escrow copies of all systems descriptions, patents, patent
applications, and hardware specifications for Safescript Pharmacies. If
Licensor is in material default under the terms of Article III (B) of
this Agreement and that default continues for longer than seventy two
(72) hours, Licensee is entitled to possession of all escrowed
materials. If Licensor is in material default under any other term of
this Agreement for a period of thirty (30) days, Licensee is entitled
to possession of all escrowed materials.
E. Licensor agrees to provide to RxSystems all updates to the software
systems, procedures, technology, systems applications, and hardware
specifications as used by Safe Med Systems and Safescript.
F. Licensor grants RxSystems the right to utilization of any and all
patent, patent applications, and all patent information for the
duration of this Master Franchise and License Agreement; this right
applies only to the pharmaceutical business and industry.
G. All portal applications and banner ads will remain the property of
Licensor.
H. Licensor agrees, for the specified RxSystems territory as determined in
Article I.B of this Agreement, that RxSystems will be the sole and only
Master Licensee and agrees that Licensor will not grant any third party
any of the license rights granted RxSystems in this Agreement.
I. Licensor agrees that it will cooperate fully with RxSystems in the
operation by RxSystems of the pharmacy locations, and Licensor agrees
to use its best efforts to enable RxSystems to operate the pharmacies.
If any operating problem is determined to be the fault of RxSystems,
RxSystems will bear the cost of correcting the problem.
J. Licensor agrees that it will provide any and all assistance required by
RxSystems in establishing a working business relationship with
McKesson, Inc., and/or Meridian Pharmaceuticals, Inc. with respect to
the pharmacies, and Licensor agrees to cooperate fully with RxSystems
in establishing such a relationship with McKesson and/or Meridian;
Licensor will not be required to provide any financial guarantees to
any supplier of RxSystems. RxSystems acknowledges that there is
currently no agreement with McKesson or Meridian and that the current
negotiations between Licensor and either McKesson or Meridian to be
anything other than a be supplier have not been finalized. In the event
that Licensor is successful in negotiating a relationship with McKesson
and/or Meridian beyond that of a supplier then Licensor shall use its
best efforts to cause the same structure to be offered to RxSystems.
K. Licensor agrees that RxSystems will be the owner of and entitled to
retain any and all rebates received from any supplier of inventory to
the RxSystems pharmacies.
L. Licensor agrees that it will make changes or modifications to the
applications and the licensed products as and when such changes or
modifications are required to operate the stores and requested by
RxSystems in order to operate the stores; no such request by RxSystems
will be unreasonably refused. Licensor will have a commercially
reasonable time period in which to make such change or modification.
The provisions of this paragraph L will not apply to stores located
outside the United States. In the event that Licensee has other
modifications that it desires to have made to the technology but which
is not required to operate the stores then such requests are to be
submitted to Licensor and Licensor will provide Licensee with a quote
for the cost of the modification and Licensee shall have the option to
accept the quote and pay for the modification.
M. Any failure by Licensor to perform under the terms of this Agreement,
which failure is the direct result of an Act of God and/or are not the
result of any failure by Licensor, shall not constitute a material
default under the terms of this Agreement.
ARTICLE IV
DUTIES OF LICENSEE
A. Licensee shall receive, hold in confidence and take all reasonable
efforts to prevent disclosure of the Information and the Documents,
except any Information or Documents that are Non-Proprietary, as
defined immediately hereafter. For the purposes of this Agreement,
"Non-Proprietary" Information and Documents are those which:
(1) are, or shall have been in the possession of Licensee prior to the
disclosure or submission thereof by Licensor to Master Licensee, and to
Licensee.
(2) are, or through no fault of Licensee become published or otherwise
available to others or to the public under circumstances such that
others or the public may utilize the same without any direct or
indirect obligation to Licensor, or
(3) are, or at any time may be, acquired by Licensee from any third
party rightfully possessed of the same and having no direct or indirect
obligation to Licensor with respect to same.
B. Licensee shall cause all copies of the Licensed Product (as well as all
promotional material) to bear appropriate proprietary notices.
C. RxSystems agrees that it will maintain any and all knowledge,
procedures, methods, technology, patent information, software, systems
and systems applications as confidential proprietary information, and
that it will not divulge any such information to third parties without
the prior consent of Licensor.
D. Licensee agrees to operate the stores in accordance with the build out,
operations, and policy compliance standards of Safescript Pharmacies;
any objection by Licensee to any requirement of these standards will be
expressed in writing to Licensor, and, absent objection, Licensee will
comply with the standards. Policy compliance standards will be the same
for all stores, whether operated by Licensee or by Licensor. Objections
will be resolved by binding arbitration within seven (7) days; RTNH
will appoint one arbitrator, RxSystems will appoint one arbitrator, and
these two arbitrators will select a third. The arbitrators so selected
shall determine the rules under which arbitration proceedings will be
conducted.
E. Licensee agrees that it will require physicians to lease from Safe Med
Systems the necessary equipment to purchase Licensed Products from the
Licensee and its sub-licensees. The terms of such leases shall be
provided by Safe Med Systems and shall be no less favorable to the
physicians as any lease of similar equipment by RTNH.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
A. Licensor hereby represents and warrants that it is the owner of the
entire right, title and interest in and to the perpetual license
covering the applications and has the sole right to grant licenses of
the scope herein granted, and (to the best of its knowledge) the
manufacture, sale and use of the Licensed Products by Licensee will not
infringe the rights of any other person.
B. Licensee hereby represents and warrants that it shall use its best
commercial efforts to market the Licensed Products and that their sale
and marketing shall be in conformance with all applicable laws and
regulations, including but not limited to all intellectual property
laws. Licensee will submit a store opening schedule no later than May
1, 2002.
ARTICLE VI.
INTELLECTUAL PROPERTY RIGHTS AND PROTECTION
A. Licensor may, but is not obligated to, continue to prosecute, in its
own name and at its own expense, the Applications in an effort to
obtain Improvement Patents. Licensor grants to Licensee the right, if
Licensor ever abandons the prosecution of the Applications in an effort
to obtain Improvement Patents, to apply for patents on the Licensed
Products provided that such patents shall be applied for in the name of
Licensor and licensed to Licensee during the License Period and
according to the terms, provisions and conditions of this Agreement.
Licensee shall have the right to deduct its reasonable out-of-pocket
expenses for the preparation, filing, and prosecution of any such
patent application from future royalties due to Licensor under this
Agreement. Licensee shall obtain Licensor's prior written consent
before incurring expenses for any foreign patent application.
B. If Licensor defaults, and such default is not cured within the
applicable time period, then any improvements in the licensed products
made by Licensee or any of its affiliates are the exclusive property of
Licensee, and all right, title, and interest in and to any such
improvements and/or derivative works shall remain with Licensee.
C. In the event that either party learns of imitations or infringements of
the Licensed Products, that party shall notify the other in writing of
the infringements or imitations. Licensor shall have the right to
commence lawsuits against third persons arising from infringement of
Licensed Products. In the event that Licensor does not commence a
lawsuit against an alleged infringer within 60 days of notification by
Licensee, Licensee may commence a lawsuit against the third party.
Before filing suit, Licensee shall obtain the written consent of
Licensor to do so, and such consent shall not be unreasonably withheld.
Licensor shall cooperate fully and in good faith with Licensee for the
purpose of securing and preserving Licensee's rights to the
Applications and Patents. Any recovery (including, but not limited to a
judgment, settlement, or licensing agreement included as resolution of
an infringement dispute) shall be divided pro rata (based on number of
stores) between the parties after deduction and payment of reasonable
attorney's fees to the party bringing the lawsuit.
D. The parties acknowledge that Safe Med Systems is the sole owner of all
patient files relating to the services provided by Safe Med Systems.
RxSystems grants to RTNH a license in connection with such data owned
by RxSystems to provide additional therapeutic and analytical services
to physicians. The parties agree that they will not use patient files
or data to solicit patients or physicians.
ARTICLE VII.
MISCELLANEOUS
A. THIS AGREEMENT SHALL BE INTERPRETED AND CONSTRUED IN ACCORDANCE WITH
AND SHALL BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS.
B. The parties consent to the exclusive jurisdiction and venue of the
federal and state courts located in Xxxxxxxx County, Texas, for any
action arising out of or relating to this Agreement. The parties waive
any other venue to which either party might be entitled by domicile or
otherwise.
C. This Agreement represents the entire understanding between the parties,
and supersedes all other agreements, express or implied, between the
parties concerning the Applications and Patents. This Agreement or any
provision of this Agreement may be changed, modified, or altered only
by a writing signed by both parties.
D. The parties agree that if any part, term, or provision of this
Agreement shall be found to be illegal or to be in conflict with any
valid controlling law, the validity of the remaining provisions shall
not be affected thereby. If the legality of any provision of this
Agreement is brought into question because of a decision by a court of
competent jurisdiction of any country in which this Agreement applies,
Licensor, by written notice to Licensee, may revise the provision in
question or may delete it entirely so as to comply with the decision of
said court.
E. The waiver of a breach hereunder may be effected only by a writing
signed by the waiving party and shall not constitute a waiver of any
other breach.
F. Nothing contained in this Agreement shall be construed to place the
parties in the relationship of agent, employee, franchisee, officer,
partners or joint ventures. Neither party may create or assume any
obligation on behalf of the other.
G. Any notices, requests, demands, or other communications required or
permitted to be given under this Agreement must be in writing and may
be personally served, sent by United States mail, sent by an overnight
courier who keeps proper records regarding its deliveries. Notice shall
be deemed to have been given if personally served, when served, or if
mailed, on the third business day after deposit in the United States
mail with postage pre-paid by certified or registered mail and properly
addressed, or if sent by overnight courier as aforesaid with charges
being billed to the sender, when received by the party being notified.
As used in this Agreement, the term "business day" means days other
than Saturdays, Sundays, and holidays recognized by Federal banks. For
purposes of this Agreement, the physical addresses of the parties
hereto shall be the physical addresses, fax numbers, and e-mail
addresses as set forth on the signature pages of this Agreement. Any
party to be notified hereunder may change its physical address by
notifying each other party hereto in writing as to the new physical
address for sending notices.
[The remainder of the page is left blank intentionally]
IN WITNESS WHEREOF, the parties have executed this Agreement in duplicate on the
date set forth above.
LICENSOR
RTIN HOLDINGS, INC.
By______________________________
Its______________________________
0000 Xxxx Xxxx
Xxxxxxxx, Xxxxx 00000
Phone: 000.000.0000; Fax: 000.000.0000
LICENSEE
RXSYSTEMS, INC.
By______________________________
Its______________________________
000 Xxxxxxxxxxxx Xx.
Xxxxx 0000
Xx. Xxxxx, Xxxxx 00000
Phone: 000-000-0000; Fax: 000-000-0000
DOCUMENT DISCLAIMER COVER PAGE
The following pages contain a document that was originally created in the
Interview of Business Lawyer.
This document was created in the Interview in the proper format and with the
language necessary to ensure its validity when all of the required information
has been entered completely.
It should be understood that any changes made to the content, appearance, or
layout of the original document outside of the Interview have been made at the
risk of affecting the validity of the document.
Xxxxxxx Technology cannot be responsible for the legal consequences of changes
you have made to this document. Furthermore, Xxxxxxx Technology is not in a
position to provide answers to questions regarding any changes to this document.
It is strongly recommended that you seek the advice of a lawyer for information
about the validity and the consequences of any changes you have made to this
document.
PROMISSORY NOTE
$450,000.00 Date: March 20, 2002
For value received, the undersigned RxSystems, Inc. (the "Borrower"), at 000
Xxxxxxxxxxxx, Xxxxx 0000, Xxxx Xxxxx, XX , promises to pay to the order of RTIN
Holdings, Inc., (the "Lender"), at 0000 Xxxx Xx. Xxxxxxxx, Xxxxx , (or at such
other place as the Lender may designate in writing) the sum of $450,000.00
without interest.
The unpaid principal and accrued interest shall be payable as follows:
$25,000.00 on or before April 1, 2002;
$25,000.00 on or before April 8, 2002;
$75,000.00 on or before April 15, 2002;
$75,000.00 on or before April 30, 2002;
and $250,000 on or before May 31, 2002 (the "Due Date").
If any payment obligation under this Note is not paid when due, the remaining
unpaid principal balance shall become due immediately at the option of the
Lender.
The Borrower reserves the right to prepay this Note (in whole or in part) prior
to the Due Date with no prepayment penalty.
If any payment obligation under this Note is not paid when due, the Borrower
promises to pay all costs of collection, including reasonable attorney fees,
whether or not a lawsuit is commenced as part of the collection process.
This note is secured by the rights granted to Borrower under that certain Letter
Agreement dated March 19, 2002 by and between Borrower and Lender. Any default
under this agreement shall result in a forfeiture of any and all rights granted
to Borrower under said Letter Agreement
If any of the following events of default occur, this Note and any other
obligations of the Borrower to the Lender, shall become due immediately, without
demand or notice:
1) the failure of the Borrower to pay the principal in full on or
before the Due Date;
2) the filing of bankruptcy proceedings involving the Borrower as a
debtor;
3) a misrepresentation by the Borrower to the Lender for the purpose of
obtaining or extending credit.
If any one or more of the provisions of this Note are determined to be
unenforceable, in whole or in part, for any reason, the remaining provisions
shall remain fully operative.
All payments of principal and interest on this Note shall be paid in the legal
currency of the United States. The Borrower waives presentment for payment,
protest, and notice of protest and nonpayment of this Note.
No renewal or extension of this Note, delay in enforcing any right of the Lender
under this Note, or assignment by Lender of this Note shall affect the liability
or the obligations of the Borrower. All rights of the Lender under this Note are
cumulative and may be exercised concurrently or consecutively at the Lender's
option.
This Note shall be construed in accordance with the laws of the State of Texas.
Signed this 19th day of March, 2002, at Longview, Xxxxxxxx County, Texas.
Borrower:
RxSystems, Inc.
By:_______________________________________
Xxxxx Xxxxxx
It's:________________________________
ASSIGNMENT
[ONLY COMPLETE THE FOLLOWING INFORMATION TO ASSIGN PAYMENTS TO A NEW PARTY.]
For value received, the above Note is assigned and transferred to
____________________________________________, ("Assignee") of
___________________________________,_________________________,
(City)(State/province)
_________________________.
(Country)
Dated: _________________________
By:____________________________________________________
RTIN Holdings, Inc.
Final Checklist for General Promissory Note
Borrower: Restaurant Teams International, Inc.
Lender: W/F Investment Corp
June 18, 2001
Make It Legal
_____ The Promissory Note must be signed and dated by Restaurant Teams
International, Inc..
_____ Restaurant Teams International, Inc.'s city and state should also be
included on the Note.
_____ The Promissory Note is secured by collateral pledged by Restaurant
Teams International, Inc.. Therefore, a Security Agreement should be
signed by the parties in addition to the Promissory Note.
Copies
Give a signed copy of the document to:
_____ W/F Investment Corp
_____ Restaurant Teams International, Inc.
Other Information
* No witnesses or notarization is required.
* The Promissory Note should be reviewed periodically to ensure that no
defaults have occurred. If Restaurant Teams International, Inc. fails
to make a payment on any given due date, W/F Investment Corp should
notify Restaurant Teams International, Inc. promptly and inform
Restaurant Teams International, Inc. of relevant penalty provisions
which may be imposed because of the default.
Reasons to Update
* To correct an error or change a term in the original Promissory Note.
* To prepare a Promissory Note for a different transaction.
