Exhibit 10 (ii)
PATENT, TECHNICAL DATA AND ASSISTANCE LICENSE
This Agreement effective the 1st day of January, 1997, and made between
Xxxx Engineering and Sales, Inc., a Delaware, USA corporation having a place of
business at Xxxx Plaza, 0000 Xxxxxxxxxxxx Xxxxxxx, Xxxxxxxxx, Xxxxxxxxx 00000,
(hereinafter "Xxxx") and Brother Industries, Ltd. a Japanese company, having a
place of business at 00-0 Xxxxxxxx-xxx, Xxxxxx-xx, Xxxxxx, 000 XXXXX
(hereinafter "Licensee").
WITNESSETH THAT:
WHEREAS, Xxxx possesses technical information and knowledge and is able to
provide technical assistance and services relating to electronically geared
sewing machines, to the assembly, manufacture and use thereof, and to methods of
sewing;
WHEREAS, Xxxx is the owner of all right, title and interest in and to the
Letters Patent, Utility Models, and applications therefor as listed in Schedule
A;
WHEREAS, Xxxx has provided technical information to Licensee in accordance
with confidentiality and non-disclosure agreements executed by Xxxx and
Licensee's Affiliates; and
WHEREAS, Licensee desires to acquire and Xxxx is willing to grant, transmit
to and provide Licensee the rights, licenses, technical assistance, technical
knowledge and services as hereinafter set forth.
1
NOW, THEREFORE, in consideration of the premises and mutual agreements
herein contained, it is hereby agreed as follows:
ARTICLE I
As used herein unless the context otherwise requires:
1.1 (a) "PATENTS" means the unexpired Letters Patent, Utility Models, and
applications therefor owned or controlled by Xxxx as of the date of
this Agreement relating to electronically geared sewing machines
including but not limited to those listed in Schedule A hereof, and
any continuation, continuation in part, division, reissue or extension
thereof and any patents or the like issuing thereon.
(b) "IMPROVEMENT PATENTS" means any unexpired Letters Patent, utility
model, inventors certificate or the like and applications therefor
hereafter filed or acquired by Xxxx during the initial seven years (7)
of the term of this Agreement relating to an improvement in
electronically geared sewing machines or to an improved method of
assembling, making or using the same or to an improved method of
sewing.
1.2 (a) "KNOW-HOW" means technical information or knowledge now possessed by
Xxxx relating to electronically geared sewing machines; methods of
assembling, making and using the same; and to methods of sewing
including, among other things, blueprints, drawings, structural
parameters,
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manufacturing, assembly procedures and methods, engineering standards,
methods and procedures for material and component selection, operating
and service instructions, but not including technical information or
knowledge pertaining to software but including:
(i) informative and knowledge heretofore disclosed to Licensee
in accordance with confidentiality and non-disclosure
agreements entered into by Xxxx and Licensee and in
anticipation of this Agreement ("Communicated KNOW-HOW");
and
(ii) information and knowledge which has not been disclosed to
Licensee as of the date of this Agreement ("Additional KNOW-
HOW").
(b) "IMPROVEMENT KNOW-HOW" means technical information or knowledge
acquired by Xxxx during the initial seven (7) years of the term of
this Agreement relating to an improvement in KNOW-HOW, improved
methods of sewing, improved electronically geared sewing machines or
to an improved method or means for assembling, making or using
electronically geared sewing machines.
1.3 "TECHNICAL ASSISTANCE" means the assistance of Xxxx in the design,
specification, drawing and other engineering functions relating to
electronically geared sewing machines, as requested by Licensee and
utilizing KNOW-HOW
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and/or IMPROVEMENT KNOW-HOW, as appropriate and provided for pursuant
to Section 2.4 hereof.
1.4 "PRODUCTION TECHNICAL TRAINING" means instruction and training in the
assembly and manufacture of PRODUCT as requested by Licensee and
utilizing KNOW-HOW and/or IMPROVEMENT KNOW-HOW, as appropriate
pursuant to Section 2.4.
1.5 "PATENTED METHOD" means a method claimed in a PATENT or, as provided
for pursuant to Section 2.4 hereof, an IMPROVEMENT PATENT.
1.6 "PATENTED PRODUCT" means an apparatus or the like covered by one or
more claims of a PATENT or used or adapted for use to practice a
PATENTED METHOD covered by one or more claims of a Patent or, as
provided for pursuant to Section 2.4 hereof, an IMPROVEMENT PATENT
provided that a continuing royalty shall be payable based on a pending
priority patent application and corresponding patent applications
pending in different countries or communities only after a claim has
been indicated to be allowable in one of said applications by a Patent
Office listed in Schedule C whereupon a continuing royalty shall be
payable based on and with respect to each said corresponding
application, including the priority application and, upon the grant of
each corresponding Patent, continuing royalty shall be due and payable
for
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the full term of such Patent during this Agreement. Xxxx agrees timely
to provide Licensee with a copy of such Patent Office action(s) which
indicate a claim is allowable together with a copy of the patent
application in which the claim is indicated to be allowable. Licensee
agrees not to disclose this information to another party until the
information is available to the public and this information shall not
be considered KNOW-HOW or IMPROVEMENT KNOW-HOW under Section 3.3. Xxxx
also agrees to provide Licensee with a copy of each issued Patent
under which a license has been granted pursuant to this Agreement or a
Supplementary Agreement pursuant to Section 2.4.
1.7 "LICENSED PRODUCT" means electronically geared sewing machines or the
like and spare, repair and replacement parts therefor, designed, made,
assembled, or used utilizing, in accordance with, or embodying KNOW-
HOW or IMPROVEMENT KNOW-HOW, as provided pursuant to Section 2.4
hereof, or with or embodying TECHNICAL ASSISTANCE and/or PRODUCTION
TECHNICAL TRAINING or information derived therefrom.
1.8 "PRODUCT" means a PATENTED PRODUCT, a LICENSED PRODUCT and/or
apparatus used or adapted for use to practice a PATENTED METHOD.
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1.9 "CATEGORY" means a category of PRODUCTS in the Field listed in
Schedule B.
1.10 "INTRODUCTION DATE" means, with respect to each Category, the date of
the first commercial shipment of a PRODUCT in that Category.
1.11 "MILESTONE DATE" means, with respect to each Category, the date on
which the aggregate Net Sales of all PRODUCT in that Category by
License and its Affiliates equals $30,000,000 U.S.
1.12 "NET SALES" means the f.o.b. factory price for the sale of a Product
exclusive of allowance or returns but in no event less than the most
recent invoice price for the nearest equivalent PRODUCT sold to an
unrelated third party in an arms length transaction within six (6)
months.
1.13 "FIELD" means the field of industrial sewing machines.
1.14 "TERRITORY" means the world.
1.15 "AFFILIATE" means an entity at least fifty percent (50%) of whose
voting share capitol is owned or directly or indirectly controlled by
Licensee.
ARTICLE II
----------
2.1 Xxxx grants to Licensee and its AFFILIATES a non-exclusive license to
make, assemble, use and sell PATENTED PRODUCT in the FIELD in the
TERRITORY under the PATENTS.
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2.2 Xxxx grants to Licensee and its AFFILIATES a non-exclusive right to
grant sublicenses, including paid-up sublicenses, to their customers
to practice PATENTED METHODS in the FIELD in the TERRITORY utilizing
PRODUCT purchased from Licensee or an AFFILIATE on which a royalty is
paid pursuant to Section 3.2 hereof.
2.3 Xxxx grants Licensee and its AFFILIATES a non-exclusive license to use
COMMUNICATED KNOW-HOW and, upon the transfer of ADDITIONAL KNOW-HOW at
LICENSEE'S request pursuant to this Section 2.3 and Section 5.1,
ADDITIONAL KNOW-HOW in the FIELD to design, specify, assemble, make,
use and sell PRODUCT in the FIELD in the TERRITORY. Xxxx agrees to
transfer ADDITIONAL KNOW-HOW to Licensee within ninety (90) days
following execution of this Agreement upon Licensee's written request.
2.4 Xxxx agrees to timely inform Licensee of the existence of any
IMPROVEMENT PATENT(S) and/or IMPROVEMENT KNOW-HOW in the FIELD
hereafter filed or developed by Xxxx. Xxxx shall provide Licensee
with a general description of the Improvement, its use, benefits and
the like to facilitate Licensee's evaluation provided that in no event
shall Xxxx disclose or be required to disclose information pertaining
to the Improvement which is considered by Xxxx to be confidential
KNOW-HOW or IMPROVEMENT KNOW-HOW until Licensee has requested such in
writing. Xxxx shall, at
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Licensee's written request, enter a Supplementary Agreement relating
to said IMPROVEMENT PATENTS and/or IMPROVEMENT KNOW-HOW in the FIELD
at terms and conditions to be negotiated and subject to such prior
approvals, registrations or the like as may then be required by any
governmental or community agency for the performance of this
Agreement.
2.5 No right or license is granted hereby, by implication or otherwise,
under any patent, patent application, technical information, know-how,
trade secret, trademark, trademark application or registration or
trade name of Xxxx or in any field except as specifically provided
herein.
ARTICLE III
-----------
3.1 Licensee shall and agrees to pay Xxxx an Initial License Fee
comprising (i) $250,000 U.S. within thirty (30) days of the execution
of this Agreement by Licensee and (ii) installment payments within
thirty (30) days of the INTRODUCTION DATE and within sixty (60) days
of the MILESTONE DATE for each CATEGORY in accordance with the
following schedule:
Introduction Milestone
Date Date
------------ -----------
Category I -- $250,000 US
Category 2 to 12 $250,000 US 250,000 US
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Xxxx shall have the right, at its option, to adjust the U.S. Dollar
amounts listed above in this Section 3.1 for any installment payment
which comes due and payable in each year after December 31, 2001 by
written notice to Licensee. If Xxxx exercises such right, the amounts
due shall be determined by multiplying the amount listed above by the
fraction having as its numerator the Annual Average of the Consumer
Price Index for all Urban Consumers, U.S. City Average, 1967 = 100, as
published by the U.S. Department of Labor Statistics, for the
preceding calendar year then ended and having as its denominator the
Annual Average for the same Consumer Price index for the year 1996. If
such Consumer Price Index is no longer published, then an index
selected by Xxxx and reasonably acceptable to Licensee which reflects
the changing purchasing power of U.S. currency and which is published
by the U.S. Government or, in the absence of such government
publication, a reputable private organization shall be substituted for
such Consumer Price Index.
3.2 Licensee agrees to pay or cause an AFFILIATE to pay Xxxx a continuing
patent royalty of two percent (2%) of Licensee's and its AFFILIATES
NET SALES of PATENTED PRODUCT assembled, made, used, sold, or sold or
adapted for use under a PATENT and, subject to a Supplementary
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Agreement pursuant to Section 2.4 hereof, an IMPROVEMENT PATENT.
3.3 Licensee agrees to pay or cause an AFFILIATE to pay Xxxx a continuing
technical fee for COMMUNICATED KNOW-HOW and, upon and after the
transfer of ADDITIONAL KNOW-HOW at Licensee's written request pursuant
hereto, ADDITIONAL KNOW-HOW and, subject to a Supplementary Agreement
pursuant to Section 2.4 hereof, IMPROVEMENT KNOW-HOW of one and three
quarter percent (1.75%) of Licensee's and its AFFILIATES NET SALES of
LICENSED PRODUCT assembled, made, used, or sold by Licensee and its
AFFILIATES, said technical fee to be payable (i) with respect to
COMMUNICATED KNOW-HOW, for a period ending five (5) years from the
date of this Agreement and (ii), with respect to ADDITIONAL KNOW-HOW
or, as appropriate, IMPROVEMENT KNOW-HOW, for a period ending ten (10)
years from the date of the first commercial sale of PRODUCT by
Licensee or the last transfer of KNOW-HOW or, as appropriate,
IMPROVEMENT KNOW-HOW or the provision of TECHNICAL ASSISTANCE or
TRAINING pursuant to Section 5.1, whichever last occurs. Any
disagreement which may arise as to whether a technical fee is due Xxxx
arising from Licensee's and/or an Affiliates' use of COMMUNICATED
KNOW-HOW with respect to a Product introduced after the date of this
Agreement, shall be finally settled under the Rules of the American
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Arbitration Association by an arbitrator appointed according to said
Rules, it being agreed by the parties that a technical fee is due with
respect to Product introduced prior to the execution of this
Agreement. The arbitrator shall apply substantive Tennessee law. The
arbitration shall take place in Chicago, Illinois.
3.4 Only one continuing royalty or fee namely the highest amount payable
under Section 3.2 or 3.3 hereof, as appropriate, shall be due Xxxx for
each PRODUCT sold by Licensee or an AFFILIATE.
3.5 Licensee agrees to pay or cause an AFFILIATE to pay Xxxx eighty
percent (80%) of the sub-license income, if any, Licensee and its
Affiliates receive pursuant to sublicenses grant under this Agreement.
3.6 Licensee and its AFFILIATES agrees to exercise their best effort to
exploit the PATENTS however Licensee has no obligation to produce or
use Product in any CATEGORIES unless clearly set forth in a written
document signed by Licensee and has no obligation to pay an initial
fee for categories in which Licensee and its Affiliates do not make,
use, or sell Products.
ARTICLE IV
----------
4.1 Licensee and its AFFILIATES shall keep complete and proper records of
all PRODUCTS assembled, made, used, sold or otherwise disposed of by
Licensee and its
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AFFILIATES or sold for use to practice or sublicensed to practice a
PATENTED METHOD on a separate, royalty bearing basis, with credit
shown for returns for which credit is given to customers, such records
to show separately the quantity of PRODUCTS assembled, made, and sold
to each customer or otherwise used or disposed of, NET SALES totals,
customers to whom a separate, royalty bearing sublicense is granted,
the date of invoice and shipment and any sublicense income received.
Sales shall be considered as made on the date of invoice or shipment,
whichever shall first occur. On or before the last day of February and
August of each year during the term hereof and on the sixtieth (60th)
day after termination hereof, Licensee shall send Xxxx a report, in
writing, certified by an officer of Licensee as to its correctness,
showing separately the NET SALES of PRODUCT assembled, made, used,
sold, or otherwise disposed of by Licensee and its AFFILIATES, any
sublicense income received by Licensee and its AFFILIATES, the parties
to whom a separate, royalty hearing sublicense has been granted and a
PRODUCT sold and computing the amount due Xxxx, for the preceding
calendar half. Unless Licensee shall be otherwise directed in writing
by Xxxx, each such report shall be accompanied by the proper amount
then payable to Xxxx as shown in such report. Licensee shall
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make application for any permission required from any governmental
agency to make the payments required hereunder within thirty (30) days
after the close of each calendar half with respect to the payments due
for said calendar half and shall promptly notify Xxxx of any
unfavorable decision on said application.
4.2 Xxxx shall have the right, during reasonable business hours, to have
the correctness of any such report audited, at its expense, by an
independent public accountant chosen by Xxxx who may examine records
of Licensee and its AFFILIATES only on material pertinent to this
Agreement. Such records of Licensee and its AFFILIATES shall be kept
available for at least four (4) years after termination of the
calendar year in which they are made. At Xxxx'x request, but no more
than once with respect to each calendar year, Licensee agrees to
cause, at Xxxx'x expense, its outside auditors to provide Xxxx with a
statement representing that the records, reports and payments kept and
made by Licensee and its AFFILIATES are accurate and correct and that
Licensee or its AFFILIATES have made the payments required hereunder.
4.3 Unless Licensee shall be otherwise directed in writing by Xxxx, all
payments called for under this Agreement shall be in United States
currency payable to Xxxx by wire
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transfer at Sun Trust Bank of East Tennessee, Drawer 5500, Xxxxxxxxx,
Xxxxxxxxx 00000 XXX; Account No. 0000000; Routing No. 000000000,
without deduction for taxes of any kind, provided that if any
government shall assess and require Licensee to withhold and pay any
tax on behalf of Xxxx, as a percentage of the payments provided for
herein, and if Licensee shall pay such taxes, furnish Xxxx evidence
satisfactory to the Internal Revenue Service of the United States that
said withheld taxes have been paid on behalf of Xxxx and if Xxxx is
entitled to a United States tax credit therefor by treaty or law, then
Licensee may deduct from such payments the amount of such taxes
actually paid by Licensee on behalf of Xxxx.
4.4 The amount of payments accrued other than in U.S. currency, shall be
converted directly into U.S. dollars (if a direct exchange rate
between the currencies is available) at the foreign exchange rate
quoted for the country in which the royalty accrued by the Tokyo
branch of Citibank, N.A., at the close of banking on the last business
day of the royalty report period.
4.5 Licensee shall pay Xxxx interest at the U.S. prime rate on the date of
payment plus two percent (2%), per annum compounded quarterly on any
payment that is overdue hereunder from the date such payment is due to
the date
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of payment. This interest payment shall be in addition to any other
remedy provided Xxxx by law or this Agreement.
ARTICLE V
---------
5.1 Within ninety (90) days of the execution of this Agreement and at the
written request of Licensee, Xxxx agrees to provide Licensee with
ADDITIONAL KNOW-HOW and Xxxx further agrees:
(a) To the end that Licensee may be well informed of said KNOW-HOW and
receive TECHNICAL ASSISTANCE and PRODUCTION TECHNICAL TRAINING, there
may be visitation of personnel of both parties at the reasonable
written request of Licensee and by prearrangement with Xxxx, all
traveling expenses to and from Xxxx'x facility and living expenses for
Licensee's personnel away from home shall be borne by Licensee under
the following conditions:
(i) Licensee may send not more than four (4) qualified personnel
to a facility designated by Xxxx for training and
instruction on KNOW-HOW and for TECHNICAL ASSISTANCE and
PRODUCTION TECHNICAL TRAINING for a period of two (2) weeks
initially and thereafter for at least a one (1) week period,
in any calendar year during the initial seven (7) years of
the term hereof. Salaries, travel expenses and
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all other expenses of Licensee's employees shall be borne by
Licensee. Licensee agrees to pay Xxxx a fee for each man-day
of training and instruction at Xxxx'x published daily
service rate.
(ii) At Licensee's reasonable written request, Xxxx shall send a
qualified technical person to a Licensee's plant from time
to time during the initial seven (7) calendar years of the
term hereof to assist Licensee in the use of KNOW-HOW and to
provide TECHNICAL ASSISTANCE and TRAINING. Licensee shall
pay Xxxx at Xxxx'x published daily service rate for each day
or fraction thereof away from home for each such technical
person supplied to Licensee pursuant hereto and, in
addition, shall pay all travel, (business class outside the
U.S.) living and other expenses incurred by Xxxx'x
employees.
(b) Representatives of either party shall at all times during their
presences on the premises of the other be subject to plant rules and
regulations of such other party pertaining to conduct of persons other
than employees, but they shall not for any purpose be deemed to be
employed by, or considered as an agent of, such other party. Licensee
shall maintain Xxxxxxx'x Compensation
16
and health insurance, each of which is valid with respect to the U.S.,
covering each employee of Licensee during his or her presence on the
premises of Xxxx.
(c) Xxxx agrees to fulfill the obligations provided in subparagraphs (a)
and (b) of this Section 5.1 with respect to IMPROVEMENT KNOW-HOW, and
TECHNICAL ASSISTANCE related thereto, subject to a Supplementary
Agreement pursuant to Section 2.4 hereof.
5.2 Licensee agrees that said KNOW-HOW and IMPROVEMENT KNOW-HOW, as
appropriate, is confidential and agree not to disclose or use, except
pursuant hereto and notwithstanding termination hereof, said KNOW-HOW
and IMPROVEMENT KNOW-HOW, as appropriate, to the extent that it is not
in the public domain. Licensee agrees to limit access to KNOW-HOW,
and, as appropriate, IMPROVEMENT KNOW-HOW to those of its employees
which have a need to have access to facilitate Licensee's use thereof
and who have an agreement with Licensee to hold confidential
information received from third parties confidential. Licensee agrees
to provide Xxxx with a list of its employees who have been given
access to KNOW-HOW and, as appropriate, IMPROVEMENT KNOW-HOW on each
December 1 during the term of this AGREEMENT and at such other times
as Xxxx shall request.
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ARTICLE VI
----------
6.1 Xxxx shall not be liable for any consequences or damage arising out of
or resulting from anything made available hereunder including the
licensing or practice of Patents nor be liable to Licensee or its
Affiliates for consequential damages under any circumstances.
6.2 Licensee shall notify Xxxx of any infringement or threatened
infringement by a third party of any PATENT which shall become known
to it. Xxxx shall use its own discretion in deciding whether to act on
this information, and its refusal to act thereon shall not affect this
Agreement.
ARTICLE VII
-----------
7.1 Licensee agrees to xxxx any PATENTED PRODUCT sold pursuant hereto, or
to all packages or containers in which PATENTED PRODUCTS are sold,
with the numbers of the PATENTS.
7.2(a) Each PRODUCT shall have a sticker supplied by Xxxx with the logo "XXXX
TECHNOLOGY" (as registered by Xxxx) prominently displayed thereon at a
location or locations and in a manner and form mutually agreed by Xxxx
and Licensee in writing; it being understood and agreed that the
sticker and manner, form and location(s) shown in Schedule D are
mutually acceptable and agreed. Each Operator and Service Manual and
Sales Brochure shall have
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the logo "XXXX TECHNOLOGY" in the same manner and form printed thereon
in a prominent location.
(b) The purchase and sale documents, including invoices, associated with
the sale of each Product shall include the following or equivalent
approved in writing by Xxxx:
"The purchase of this equipment includes the grant of a license
to use the equipment to practice methods covered by patents of
Xxxx Engineering and Sales"
7.3 Licensee agrees, at Xxxx'x expense (including the purchase price
extended to Licensee's most favored customers) and request, to deliver
to Xxxx one PRODUCT in each Category specified by Xxxx from current
manufacture but no more than two (2) times in any calendar year of the
term of this Agreement. Xxxx may, in its discretion, terminate Section
7.2(a) of this Agreement.
ARTICLE VIII
------------
8.1 As to each PATENT, all grants, obligations and provisions herein
relating thereto shall continue in full force and effect, unless
otherwise provided or sooner terminated as herein provided, until the
expiration date of said PATENT. In the event any Patent is determined
invalid in any court, Licensee shall have the right to withhold
reports and payments relating to such Patent until such determination
is reversed or vacated. Xxxx shall be
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entitled to terminate this Agreement if and when Licensee withholds
any report or payment.
8.2 As to all grants, obligations and provisions relating to said KNOW-HOW
and TECHNICAL ASSISTANCE, this Agreement shall continue in full force
and effect, unless otherwise provided or sooner terminated as herein
provided, until (i) with respect to COMMUNICATED KNOW-HOW, the elapse
of a five (5) year period from the date of this Agreement and, (ii)
with respect to ADDITIONAL KNOW-HOW, until the elapse of a ten (10)
year period commencing on the date of the first commercial sale of
PRODUCT manufactured by Licensee under this Agreement or the last
transfer of KNOW-HOW or provision of TECHNICAL ASSISTANCE or TRAINING
pursuant to Section 5.1, whichever last occurs.
8.3 Xxxx may terminate this Agreement forthwith upon written notice to
Licensees if:
(a) Licensee remains in default in making any payment or report
required hereunder, or fails to comply with any other provision
hereof for a period of thirty (30) days after written notice of
such default or failure is given by Xxxx to Licensee.
(b) Licensee shall become insolvent, make an assignment for the
benefit of creditors or the like, or commit any act of
bankruptcy, or if any order for the compulsory liquidation,
reorganization or the like,
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of Licensee shall be made by any court or governmental agency or
the like.
8.4 Any termination of this Agreement shall not relieve Licensee of
liability for any payments accrued prior to the effective date of such
termination, or for any payments on PRODUCT manufactured under this
Agreement prior to the effective date of such termination and sold
thereafter.
8.5 Upon termination pursuant to Section 8.3 hereof, Licensee shall have
no right or license in or to said KNOW-HOW and hereby agrees to cease
and desist using said KNOW-HOW for a reasonable period, which shall
not be less than a two (2) year period following the effective date of
such termination. Upon the elapse of said two (2) year period,
Licensee shall have no right to use or disclose and agrees to desist
from use of such of said KNOW-HOW not then generally in the public
domain.
ARTICLE IX
----------
9.1 This Agreement may, at any time, and without Licensee's consent, be
assigned by Xxxx without such assignment operating to terminate,
impair or in any way change any of the obligation or rights which Xxxx
would have had, or any of the obligations or rights which Licensee
would have had if such assignment had not occurred. From, and after,
the making of any such assignment by Xxxx, the
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such assignee shall be substituted for Xxxx as a party hereto and Xxxx
shall no longer be bound hereby.
9.2 This Agreement shall inure to the benefit of, and be binding upon, the
successors and assigns of both parties, but no assignment by Licensee
of this Agreement, or any part thereof, including any transfer or the
like in conjunction with a sale, merger or the like of Licensee or any
part thereof, shall have any force or validity whatsoever, except,
unless and until approved in writing by Xxxx.
ARTICLE X
---------
10.1 Xxxx represents and warrants:
a) Xxxx owns the Patents listed in Schedule A free of any lien or
encumbrance;
b) Xxxx has the right to prosecute the patent applications listed in
Schedule A and upon issuance of any patents pursuant thereto will
own the same, free of any lien or encumbrance;
c) Xxxx employees having access to Xxxx KNOW-HOW have executed
agreements pursuant to which they have undertaken not to use the
Xxxx KNOW-HOW and/or have a fiduciary duty to Xxxx not use Xxxx
KNOW-HOW except for Xxxx purposes nor to disclose the same to
others;
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d) As of the date of this Agreement, Xxxx is not aware of any patent
(United States or Foreign) owned by any other person, firm or
corporation that is infringed by PRODUCT.
10.2 Xxxx and Licensee each represents and warrants to the other that each
respectively has full power and authority to enter into this License
Agreement and to carry out the transactions contemplated hereby, and
that all necessary corporate action has been duly taken in connection
therewith.
ARTICLE XI
----------
11.1 Each of the parties shall inform the other of any infringement of the
Patents of which it becomes aware.
11.2 Xxxx shall have the right but not the obligation to take action
against the infringer.
ARTICLE XII
-----------
12.1 Subject to other provisions of this Agreement which shall control,
either party shall hold in confidence and not disclose to any third
party any confidential information disclosed by the other party
without a prior written consent of the other party.
12.2 Each party hereto agrees that the contents of this Agreement and any
payments or reporting made with respect thereto shall be kept
confidential between the parties hereto and shall not be disclosed in
the form of press
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releases or otherwise to third parties except its legal counsel,
except to the extent necessary to comply with governmental
requirements or otherwise as required by law or legal process.
ARTICLE XIII
------------
13.1 All notices, requests or communications which either party may desire,
or be required, to give to the other shall be in writing and shall be
deemed to have been duly served if and when forwarded by registered or
certified mail to such address as shall have been designated by notice
from the addressee for addressing a notice to it, or if no such
designation shall have been made, then to the address of the party
appearing above. Any notices, requests or communications not
following the above procedure is not effective.
13.2 The failure to act upon any default hereunder shall not be deemed to
constitute a waiver of such default.
13.3 The validity, legality and enforceability of any provision hereof
shall not be affected or impaired in any way by any holding that any
other provision contained herein is invalid, illegal or unenforceable
in any respect.
13.4 This Agreement, various confidentiality and non disclosure agreements,
and, if entered into by the parties at a later date, the Xxxx Software
Agreement
24
constitute the entire agreement between the parties with respect to
the subject matter hereof.
13.5 In the event Xxxx grants a license to a third party on more favorable
terms than those herein, then Licensee may at its option substitute a
license in the exact form and substance as granted to the third party
for the license herein, and payments previously made by Licensee to
Xxxx hereunder shall be credited against payments of like type [e.g.
initial payment, continuing royalty] required in such more favorable
license. This provision shall not, however, apply to any license to a
third party that arises, either directly or indirectly, out of any
litigation, or settlement of litigation, with the third party, or
which includes some unique consideration other than the payment of
moneys or consideration which Licensee cannot provide or which
includes other agreements, licenses or rights.
13.6 This Agreement does not include, nor does it infer, any right in Xxxx
to use any of Licensee's trademarks.
13.7 This Agreement shall be interpreted in accordance with the law of
state of Tennessee USA and the parties agree that original
jurisdiction over the parties and disputes under or related to this
Agreement shall reside with the U.S. District Court for the Eastern
District of Tennessee.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
XXXX ENGINEERING AND SALES, INC. BROTHER INDUSTRIES, LTD.
BY /s/ Xxxxxxx X. Xxxx By /s/ Xxxxxxxxx Xxxxx
----------------------------- -------------------------
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SCHEDULE A
----------
(1) Patent Information
U.S. Patent No. 5,458,075
U.S. Application:
Serial No. 08/656,037
Filing Date: 24 May 1996.
PCT Application:
PCT International Application No.
PCT/US95/12032
Dated: 12 Sept. 1995
Priority Date: 15 Sept 1994
27
SCHEDULE B
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CATEGORY
--------
AUTOMATIC BACK YOKE SEWER
AUTOMATIC BELT LOOP SEWER
AUTOMATIC BUTTON HOLER
AUTOMATIC BUTTON SEWER
AUTOMATIC COLLAR SEWER
AUTOMATIC CUFF SEWER
AUTOMATIC POCKET SETTER
AUTOMATIC POCKET WELT SEWER
AUTOMATIC SLEEVE VENT SEWER
CHAIN STITCH MACHINE
ELECTRONIC EDGE SEAMER
ELECTRONIC EMBROIDERY MACHINE
FEED OFF THE ARM MACHINE
LOCK STITCH MACHINE
PROGRAMMABLE ELECTRONIC PATTER SEWER
28
SCHEDULE C
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European Patent Office
Australia
Austria
Switzerland
Germany
France
United Kingdom
Netherlands
Sweden
Japan
South Korea
Canada
29
SCHEDULE D
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[PICTURE OF XXXX LOGO]
30
