EXHIBIT 99.1
AGREEMENT
FOR THE ASSIGNMENT OF PATENT RIGHTS
THIS AGREEMENT FOR THE ASSIGNMENT OF PATENT RIGHTS, dated this 7th day
of April, 2002, by and between
XXXXXXX XXXXXX XXXXXXXX, an individual who resides at 0000 X.
Xxxxxxx, Xxxxxxxxx, Xxxxxxxxxx 93010(hereinafter referred to as ("Xxxxxxxx"),
and
QUICKTEST 5, INC., a Delaware Corporation, organized and existing under
the laws of the State of Delaware (hereinafter referred to as the "Quicktest").
W I T N E S S E T H:
WHEREAS, Xxxxxxxx is the Inventor and proprietary owner of that certain
United States Patent No. 6,268,386 dated July 31, 2001 for Nicotine Beverage.
Said Xxxxxxxx originally filed his application as No. 104225 on June 25, 1998.
The Abstract in said Patent states: "A liquid composition including a Nicotine
or alkaloid having the same direction of activity, content between 0.0001% and
0.1%." "Current U.S. Class: 514/343;514/810;514/813." "Inten'l Class:
A61K031/44." "Field of Search: 514/343,810,013." Said Xxxxxxxx owns all rights,
titles and interest in and to said Patent, information he owns regarding certain
technology for the manufacture of products using said Patent as well as pending
and existing intellectual property matters, to include patenting, trademarking,
brand naming, service marking, and copyrighting of Xxxxxxxx'x product lines,
technologies and inventions, future plans and operations, to include, but not
limited to, all products, technology, and market research and development done
in support of such future plans and operations. A true and correct copy of said
Patent is attached as Exhibit "A" and incorporated in this Agreement by
reference.
WHEREAS, pursuant to the terms and subject to the conditions hereof,
Xxxxxxxx has agreed to assign all his right title and interest of his Patent
Rights and does hereby sell, transfer, assign and set over unto Quicktest 5,
Inc., his entire right title and interest in and to the Patent, in the United
States of America and all foreign countries together with all common law rights
related thereto, all rights of renewal and extension, and the right to recover
for damages and profits for past infringements thereof.-
Worldwide.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, and intending to be legally bound,
the Xxxxxxxx and the Quicktest
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hereby agree as follows:
ARTICLE 1
DEFINITIONS
1.1 Definitions. Whenever used in this Agreement, the Recital
above, or any Exhibit hereto, unless otherwise required by the subject matter or
the context, the following terms shall have the meanings respectively ascribed
to them:
(a) "Affiliate" means, in respect to any Person, any other Person
that directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with such first Person.
(b) "Best knowledge" means, in respect of a Person, that nothing has
come to the attention of that Person that gives such Person actual knowledge of
the existence or absence of any material information or fact bearing on the
matter.
(c) "Books and Records" are those records maintained by Quicktest or
Quicktest's Affiliates kept in the ordinary course of business applying "GAAP"
principles.
(d) "Claim" means a written notice asserting a breach of a
representation, warranty or covenant specified in the Agreement which shall
reasonably set forth, in light of the information then known to the party giving
such notice, a description of and an estimate (if then reasonable to make) of
the amount involved in such breach or for a claim for injunctive relief.
(e) "Competing Person" means any Person a substantial majority of
whose business is in the same business xx Xxxxxxxx and who is a direct
competitor of Xxxxxxxx or any of its Affiliates or any Person that is an
Affiliate of such Person.
(f) "Confidential Information" means any confidential or secret
information or data, whether or not reduced to writing, pertaining to the
Patent, including scientific or technical knowledge, expertise, skill, practice,
proprietary rights, copyrights, patented or un-patented inventions, formulas,
trade secrets, manufacturing techniques and procedures, analytical methodology,
processes, and data and shall include any and all technology, pending and
existing intellectual property matters, including patenting, trademarking, brand
naming, service marking, and copyrighting of Xxxxxxxx'x product lines,
technologies and inventions, future plans and operations, to include, but not
limited to, all products, technology, and market research and development done
in support of such future plans and operations.
Provided however, that in respect of the obligations of either party
hereunder, the term "Confidential Information" shall not include any information
that (i) is now or subsequently enters the
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public domain through means other than direct or indirect disclosure by a party
in violation of the terms of this Agreement or (ii) is lawfully communicated to
a party by a third party, free of any confidentiality obligation, subsequent to
the date hereof.
(g) "Control" means (i) when used in respect of any Person, the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such entity, whether through the
ownership of voting securities, by contract or otherwise, and (ii) when used in
respect of any security, the possession, directly or indirectly, of the power to
vote, or to direct the voting of, such security or the power to dispose of, or
to direct the disposition of, such security.
(h) "Controlling Person" means, in respect of any business
organization or other legal entity, a Person having control of such business,
organization or entity, and any second Person having Control of such first
Person, and so on in an ascending order up to and including the last Person
having Control of the next preceding Person who is not subject to the Control of
any other Person.
(i) "Enhancements" means any change, correction, modification,
improvement, enhancement, addition or revision to the Patent.
(j) Intentionally left blank
(k) "First Distribution" shall mean the first distribution of
Quicktest's Product utilizing the Licensed Patent of Xxxxxxxx for consideration
to any Third-Party.
(l) "GAAP" mean generally accepted accounting principles
consistently applied.
(m) "Governmental Authority" means any governmental body, agency or
official of any county or political subdivision of any country.
(n) "Indemnified Party" means the Person who is entitled to
indemnification for, and to be held harmless in respect of, a claim, cause of
action or any other proceedings, as provided under the terms and subject to the
conditions of this Agreement.
(o) "Indemnifying Party" means the party hereto that is obligated to
indemnify and to hold harmless another Person in respect of a claim, cause of
action or any other proceeding, as provided under the terms and subject to the
conditions of this Agreement.
(p) "Intellectual Property" means all intellectual and industrial
property and includes (i) inventions and patents for inventions, including
re-issue thereof and continuation and continuations in part, (ii)
copyrights,(iii) designs and industrial designs, (iv) trade marks, and any word,
symbol, icon, logo or other indicia or origin adopted or used in connection with
the license or service and (v) trade secrets and confidential information
described in (f) above.
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(q) "Intellectual Property Rights" means all intellectual and
industrial property and other proprietary rights in respect of Intellectual
Property, and includes all right to Intellectual Property.
(r) "Know-How" means "The Confidential Information" and proprietary
information, including any formula, pattern, compilation, method, invention,
technique or process, used in the creation of the Patent.
(s) "Net Revenues" means all revenues received (as such receipt is
determined on a cash basis in accordance with GAAP) by the Quicktest from the
sale of its products and services in which the Licensed Product is utilized, net
of free and discounted items, rebates, returns, adjustments, sales and other
taxes associated or incurred in connection with Quicktest' sale of its products
and services, and recoveries in bankruptcy.
(t) "Person" means a human being, partnership, association, joint
venture, corporation, legal representative, trustee, trustee in bankruptcy,
receiver or any other legal entity whatsoever.
(u) "Patent" means any and all proprietary rights of Xxxxxxxx to the
Patent as described in Exhibit "A" and any enhancement thereof.
(v) "Royalty Fee" Means that fee which represents $1.20 per case (case
consists of 24 bottles per case) for all Products which utilize the Licensed
Patent Process of Xxxxxxxx in any application, during the term of this Agreement
in consideration for the granting of the assignment of the Patent by Xxxxxxxx to
Quicktest herein.
(w) "Xxxxxxxx" means Xxxxxxx Xxxxxx Xxxxxxxx, an individual who is the
inventor and Patent holder, and assignor of Patent..
(x) "Quicktest's Product Line means "Nicotine Beverage" Water in the
form and substance manufactured under the direction and control of Quicktest
under its Trade Name, Trademark or any other name utilized by Quicktest.
(y) "Third Party Claim" means, in respect of the obligations of an
Indemnifying Party hereunder, a claim asserted against, imposed upon or incurred
by the Indemnified Party by any third party.
1.2 Additional Terms. The definitions in Section 1.1 shall apply
equally to both the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include," "includes" and "including" shall
be deemed to be followed by the phrase "without limitation." All references to
"party"
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and "parties" shall be deemed references to the parties to this Agreement and to
a party's successor in title unless the context shall otherwise require. All
references to Sections and Paragraphs shall be deemed references to Sections and
Paragraphs of this Agreement, unless the context shall otherwise require. All
references herein to Schedules and Exhibits shall be deemed to be references to
the Schedule(s) and Exhibit(s) attached to this Agreement. The terms "this
Agreement", "hereof, "hereunder", and similar expressions refer to this
Agreement as a whole and not to any particular Article or Section or other
portion hereof and include any agreement supplemental hereto. The conjunction
"or" shall be understood in its inclusive sense (and/or).
1.3 Headings. The division of this Agreement into Articles
and Sections and the insertion of headings are for convenience of reference only
and shall not affect the construction or interpretation of this Agreement.
ARTICLE 2
2.1 ASSIGNMENT OF PATENT
Subject to the terms and condition? of this Agreement, Xxxxxxxx hereby
grants to Quicktest an assign of all his right title and interest of his Patent
Rights and does hereby sell, transfer, assign and set over unto Quicktest 5,
Inc.,. his entire right title and interest in and to the Patent, in the United
States of America and all foreign, countries together with all common law rights
related thereto, all rights of renewal and extension, and the right to recover
for damages and profits for past infringements thereof.- Worldwide.
Any Enhancements to Xxxxxxxx'x Patent shall be owned by Quicktest.
If requested by Quicktest, Xxxxxxxx herein agrees that he shall apply for
and complete all necessary documents in order to make applications for the
United States Patent in other countries. If requested to do so by Quicktest,
Quicktest herein agrees to pay for all costs and fees connected with said
Patent. The parties agree that the owner of any Patent applied for in other
jurisdictions, and paid for by Quickiest shall be owned by Quicktest.
Xxxxxxxx has utilized the Patent process in various manners and/or
products. The Parties acknowledge that Quicktest has the exclusive right to
utilizes said variation of the use of said Patent.
The Parties agree that at such time as the new process is available for
market, Quicktest shall pay a Royalty to be negotiated between the parties, in
good faith, for commercially acceptable terms.
In Consideration of the assignment of the above Patent, Quicktest 5, Inc.
shall give to Xxxxxxxx One Hundred Thousand Shares (100,000) of its common stock
upon the assignment of the Patent Assignment.
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2.2 VALUE ADDED RESELLER
Quicktest acknowledges that it is a Value Added Reseller (VAR), and that it
shall sell Products utilizing the Patent for incorporation into systems which
Quicktest: (a) re-markets to unaffiliated third party users in the regular
course of business, and/or (b) for uses in providing services to such third
parties.
ARTICLE 3
3. Quicktest DUTIES
Quicktest shall provide the following:
3.1 Premises: Quicktest shall establish and maintain appropriate, premises
and facilities.
3.2 Promotion of Product and Adequate Sales Force: Quicktest agrees, as a
material condition of assignment, to provide sufficient funds and adequate
personnel to market the product line of Quicktest in order to meet the
Performance Goals as set forth below.
3.3 Performance Goals: Quicktest agrees that the following Performance
Goals shall be met by Quicktest as a condition to the continuance of this
Agreement. It is the intent of this Agreement that the Quicktest will satisfy
these goals on a yearly basis. Failure to due so will constitute grounds for
termination. Said Performance Goals are set forth in Exhibit "B" -
3.4 Quicktest Fee/ Royalty:
(a) Quicktest shall pay to Xxxxxxxx a Royalty of $1.20 per case (case
consists of 24 bottles) on each and every case from the sale of Quicktest's
Product in which the Patent is utilized.
(b) The first Royalty Fee shall start on the first day of the calendar
quarter commencing at such time as Quicktest distributes "First Distribution"
its first Product to Third-Parties in which the Patent is utilized, and every
quarter thereafter during the term of this Agreement.
(c) Quicktest shall give prompt written notice of "First Distribution" to
Xxxxxxxx distributed by Quicktest that contains the Patent.
(d) If any Royalty Fee is not received when due, it will hi-' subject to an
additional payment of one (1 %) percent of the amount due per month or a portion
thereof as liquidated damages for payments received later than the due date.
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(e) If any payment due under this Agreement is not received by Xxxxxxxx
within sixty (60) days after the due date, the assignment shall be cancelled and
terminated subject to Section 10.4 (a).
3.5 Quarterly Reports:
(a) Within thirty (30) days after the end of each calendar quarter, whether
or not a Royalty Fee payment is due for that period, Quicktest shall provide
Xxxxxxxx with a written statement with respect to such period specifying the
number of cases sold of Quicktest's Product in which Xxxxxxxx'x Patent is
utilized, and the amount of Royalty Fee due Xxxxxxxx, if any.
3.6 Records:
(a) Quicktest shall keep complete and accurate records pertaining to the
distribution and sale of Quicktest's Product appropriate to determine the
Royalty Fees payable under Sections 3.4 above of this Agreement for the
preceding three (3) years.
(b) At the request and expense of Xxxxxxxx, an independent certified public
accountant, selected by Xxxxxxxx and approved by Quicktest, shall have access at
Quicktest's principal place of business during ordinary business hours, to such
records maintained by Quicktest as may be necessary to (i) determine, with
respect to any of the three (3) preceding years the correctness of any report or
payment, made under this Agreement, or (ii) obtain information as to the
Quicktest Fee payable in the case of Quicktest's failure to report or pay such
Quicktest Fee pursuant to this Agreement. If deemed necessary or desirable in
the sole opinion of the accountant, the accountant shall at Xxxxxxxx'x expense
be permitted to consult with and obtain the assistance of consultants selected
by the accountant and acceptable to Quicktest. Neither, the accountant nor the
selected consultants shall disclose to Xxxxxxxx or any Third- Parties any
information relating solely to the accuracy of the reports and payment under
this Agreement, in the event that the dollar amount of "Net Revenue" reported by
Quicktest for any quarter differs by more than five (5%) percent from actual as
determined by said accountant or consultant, then Quicktest shall pay to
Xxxxxxxx the actual Quicktest Fee plus any cost to Xxxxxxxx for the accountant
and/or consultant.
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF
XXXXXXXX
To induce the Quicktest to acquire the Patent rights, Xxxxxxxx hereby makes
the following representations and warranties:
4.2 Authorization. Xxxxxxxx has full authority to assign the Patent.
Xxxxxxxx has full power and authority to execute and deliver this Agreement to
consummate the transactions contemplated hereby. The execution, delivery and
performrance of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by all necessary parties required
by law or otherwise to be taken by Xxxxxxxx to authorize the execution and
delivery of this Agreement and the agreements specified herein or the
consummation of the transactions contemplated hereby and thereby.
4.3 Binding Agreements. This Agreement constitutes the legal, valid and
binding obligations of Xxxxxxxx, enforceable in accordance with its terms.
4.4 No Violation. Neither the execution and delivery by Xxxxxxxx of this
Agreement nor the consummation by Xxxxxxxx of the transactions contemplated
hereby will (a) conflict with or violate any statute, law, regulation, rule,
order, judgment or decree of any court or Governmental Authority binding upon or
applicable to Xxxxxxxx. Xxxxxxxx is not a party to, nor is it bound by, and
Xxxxxxxx Patent is not subject to, any agreement or commitment that prohibits
the execution and delivery by the Quicktest of this Agreement or the
consummation of the transactions contemplated hereby.
4.5 Litigation. No action, suit, inquiry, audit, or to the Best Knowledge
of Xxxxxxxx no proceeding or investigation, by or before any court or
governmental or other regulatory or administrative agency or commission is
currently pending or, to the Best Knowledge of Xxxxxxxx threatened, against,
involving or arising in connection with Xxxxxxxx'x Product Line or that
questions or challenges the validity of this Agreement or any action taken or to
be taken by Xxxxxxxx pursuant to this Agreement.
4.6 Right to License Xxxxxxxx'x Patent. Xxxxxxxx has the right to assign
the Patent as described above.
4.7 Intellectual Property Rights.
To the Best Knowledge of Xxxxxxxx, the Patent rights and the use thereof
will not infringe upon or violate any Intellectual Property Right of any Third
Person.
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ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF THE Quicktest
To induce Xxxxxxxx to enter into this Agreement with the Quicktest, the
Quicktest hereby represents and warrants to Xxxxxxxx as follows:
5.1 Corporate Organization and Good Standing. The Quicktest is a Company,
duly organized, validly existing and in good standing under the laws of the
State of Delaware.
5.2 Authorization. Ths Quicktest has full corporate power and authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby and thereby have
been duly authorized by all necessary corporate action required by law, the
Quicktest's Articles of Incorporation, or otherwise to be taken by the Quicktest
to authorize the execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby.
5.3 Binding Agreements. This Agreement constitutes the legal, valid and
binding agreements of the Quicktest enforceable in accordance with its terms.
5.4 No Violation. Neither the execution and delivery by the Quicktest of
this Agreement nor the consummation by the Quicktest of the transactions
contemplated hereby, will (a) violate any provisions of the Articles x-'fh?
corporation of the Quicktest; (b) conflict with or violate any statute, law,
regulation, rule, order, judgment or decree of any court or Governmental
Authority binding upon or applicable to the Quicktest or by which the property
or assets of the Quicktest are bound or affected.
5.5 Litigation. No action, suit, inquiry, audit, or to the Best Knowledge
of the Quicktest no proceeding or investigation, by or before any court or
governmental or other regulatory or administrative agency or commission is
currently pending or, to the Best Knowledge of the Quicktest threatened,
against, involving or arising in connection with the Quicktest entering into
this Agreement or that questions or challenges the validity of this Agreement or
any action taken or to be taken by the Quicktest pursuant to this Agreement.
ARTICLE 6
COVENANTS OF THE PARTIES
6.1 Cooperation. Each party shall cooperate reasonably with the
other in preparing and filing all notices, applications, reports and other
instruments and documents which are required by any statute, rule, regulation or
order of any Governmental Authority in connection with the transactions
contemplated by this Agreement, including the use of the Patent.
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6.2 Xxxxxxxx working with Quicktest's Chemists. Quicktest shall have the
right to select a Chemists of its choice to utilize the patent process of
Xxxxxxxx to be used in Quicktest's Products. Xxxxxxxx herein agrees that he
shall devote such time as is necessary to assist the Chemists in perfecting a
method of utilization of the Patent process in Quicktest's Product in order to
maintain a high quality of the Products that has come to be associated with
Quicktest's Product.
6.3 License to Exploit Patent Worldwide. Xxxxxxxx hereby grants to the
Quicktest exclusive, fully paid right and license to use and exploit the Patent,
or any Enhancements thereto, Worldwide in connection with the manufacture of
Quicktest's Products.
6.4 Compliance with Laws. In connection with the assignment herein and the
consummation of the transactions contemplated hereby and the performance by a
party of its obligations hereunder, each Xxxxxxxx and Quicktest shall comply
with all applicable laws, requirements, rules, regulations and standards of
Governmental Authorities of any pertinent jurisdiction so that neither of the
parties shall be subject to any fines or penalties; or violate any laws or
regulations affecting the Patent, lease, license and sale of the Products
contemplated herein,
6.5 Confidential Information.
The Quicktest shall keep, file and store the Confidential Information,
together with any notes or other material incorporating or relating to the
Confidential Information, in a manner consistent with its confidential nature.
Except in respect to the exploitation and use of the Confidential Information by
the Quicktest in respect of the exploitation of its rights and interests in and
to Property. Quicktest shall take all appropriate action, whether by
instruction, agreement or otherwise, to ensure that its directors, officers and
employees do not disclose or misappropriate the Confidential Information,
directly or indirectly. Notwithstanding the foregoing, Quicktest shall have the
right to disclose Confidential Information to the extent that it is required to
be disclosed by any applicable law or any rule or regulation of any Governmental
Authority having jurisdiction over the Quicktest, as the case may be.
ARTICLE 7
PROTECTION OF THE PATENT RIGHTS
7.1 Xxxxxxxx not Liable for the Product Distributed by Quicktest:
(a) Xxxxxxxx assumes no responsibility for the Products of Quicktest which
unitlizes the Patent which are sold to Third-Parties. No warranties made by Quicktest
in connection with the Patent or the Products produced therefrom shall expressly
or implicitly obligate Xxxxxxxx.
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(b) Quicktest shall indemnify and hold Xxxxxxxx harmless against all claims
for all losses, expenses and damages awarded by a court of competent
jurisdiction, and reimburse Xxxxxxxx for all reasonable legal fees and costs
incurred by Xxxxxxxx in defense of such claims arising from the distribution,
use of the Patent of Quicktest's Product. Quicktest shall have the right to
control any lawsuit based on such claims and to settle the same.
7.2 Notice of Infringement or Unauthorized Use. Each party shall promptly
inform the other party in writing of any notice of claim or action, or any
threatened claim or action, against either party by any third Person arising out
of in any way related to the Patent.
7.3 Institution. Prosecution and Defense of Claims.
(a) (i) Promptly following the delivery to the notice of any act of any
infringement, unauthorized use, piracy or misappropriation of, or breach of any
confidentiality agreement or affecting the Patent, or, in the case where such
infringement, unauthorized use, piracy misappropriation or breach is discovered
by the parties or is otherwise brought to its attention and the parties Xxxxxxxx
herein grants to the Quicktest authority to take such steps as shall be
necessary in order to protect the Quicktest and Xxxxxxxx'x rights with respect
to the said Patent, respectively, including, but not limited to, instituting or
authorizing others to institute any claim, suit or proceeding at law or in
equity arising out of or related to the infringement, unauthorized use, piracy
or misappropriation of, or breach of any confidentiality agreement pertaining
to, or in any way affecting the Patent.
(ii) The institution, prosecution, maintenance and control of any claim,
suit or proceeding at law or in equity arising out of or related to, or in any
way affecting the Licensed Property shall be subject to the direction and
control of the Quicktest, at its sole cost and expense, and any and all sums
that may be received, obtained, collected or recovered in any such claim, suit
or proceeding, whether by decree, judgment, settlement or otherwise, shall be
the sole and exclusive property of the Quicktest.
(b) If requested by Quicktest, Xxxxxxxx shall join Quicktest as, a party
complainant in any such claim, suit or proceeding.
(c) Quicktest shall defend, at its own expense, any claim that a
Third-Party shall institute effecting the Patent granted to the Quicktest
herein. Xxxxxxxx shall cooperate fully in the defense of any such claim, suit or
proceeding against any party by a third Person, brought in connection with,
arising out of or related to the Patent, and each party shall execute such
documents and take such actions as may be reasonably requested by the other
party and consistent with the rights and obligations of the parties hereunder.
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ARTICLE 8
INDEMNIFICATION
8.1 Survival of Representations and Warranties and Covenants. Except as
otherwise expressly provided herein all representations and warranties made by
any party in this Agreement shall survive from and after the date hereof and
shall continue in effect for a period of two (2) years from the date hereof, and
all covenants made by any party in this Agreement shall survive indefinitely
unless otherwise terminated by the parties. Any right of indemnification
pursuant to this Article 8 in respect of a claimed breach of any representation,
warranty or covenant shall expire at the date of expiration of the
representation, warranty or covenant claimed to be breached, unless on or prior
to the Termination a claim has been made against the party from whom
indemnification is sought. If a Claim is timely made, it may continue to be
asserted beyond the Termination Date of the representation, warranty or covenant
to which such Claim relates.
8.2 Indemnification.
(a) Xxxxxxxx hereby agrees to indemnify and hold harmless Quicktest from
and against all Damages asserted against, imposed upon or incurred by Quicktest,
directly or indirectly, by reason of or resulting from, any breach or inaccuracy
of any representation, warranty or covenant of Xxxxxxxx set forth in this
Agreement.
(b) The Quicktest hereby agrees to indemnify and hold harmless Xxxxxxxx
from and against all Damages asserted against, imposed upon or incurred by
Xxxxxxxx, directly or indirectly, by reason of or resulting from any breach or
inaccuracy of any representation, warranty or covenant of the Quicktest set
forth in this Agreement.
ARTICLE 9
9. Injunctive Relief. Xxxxxxxx and Quicktest hereby acknowledge and agree
that any default under Section 6.8 "Confidential Information" above will cause
damage to Xxxxxxxx in an amount difficult to ascertain. Accordingly, in addition
to any other relief to which Xxxxxxxx may be entitled, Xxxxxxxx shall be
entitled to such injunctive relief as maybe ordered by any court of competent
jurisdiction including, but not limited to, an injunction restraining any
violation of Paragraph ***5.
ARTICLE 10
TERM AND TERMINATION
10.1 Term: The term of this Agreement shall be for the life of the Patent.
In addition thereto the
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Royalty shall continue so long as the Patent Process is being used in any
Product or Products of Quicktest.
10.2 Termination:
BY XXXXXXXX:
(a) Xxxxxxxx may terminate this Agreement at any time upon Quicktest's
failure to make payments due to Xxxxxxxx pursuant to this Agreement, or to
render statements as required by Section 3.4 , 3.5 and the continuation of such
failure for more than thirty (30) days after delivery of written notice to
Quicktest of such failure.
(b) The failure by Quicktest to perform the Performance Goals as set forth
in Exhibit "B", and the continuation of such failure for more than thirty (30)
days after delivery of written notice to Quicktest of such failure.
BY QUICKTEST:
(a) In the event Xxxxxxxx'x initial Patent fails to meet the requirements
needed by Quicktest to perfect its Products, then in that event, Quicktest shall
give to Xxxxxxxx within sixty (60) days of learning of the problem written
notice of such defect to Xxxxxxxx, Xxxxxxxx shall have ninety (90) days to comet
said problem, in the event, Xxxxxxxx fails to correct the problem within the
said ninety (90) days, Quicktest shall have the right to terminate this
Agreement.
RIGHT TO TERMINATE BY EITHER XXXXXXXX OR QUICKTEST
(a) Either party may terminate this Agreement upon thirty (30) days prior
written notice in the event of the other party's breach of any material
provision of this Agreement, if such default or breach is not remedied within
thirty (30) days from the date of such notice.
(b) If any representation or covenant made under this Agreement shall prove
incorrect or misleading in any material respect when made.
(c) If there shall be entered a decree or order by any court having
jurisdiction in the premises constituting an order for relief in respect of
Quicktest under Title 11 of the United States Code, as now constituted or
hereafter amended, or any other applicable federal or state bankruptcy law or
similar law, or appointing a receiver, liquidator, assignee, trustee, custodian,
or similar office dealing with its property or of any substantial part of its
properties, or ordering the winding-up or liquidation of the affairs, and any
such decree or order shall continue in effect for a period of ninety (90) days
consecutive days.
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(d) If Quicktest shall file a petition, answer, or consent seeking relief
under Title 11 of the United States Code, as now constituted or hereafter
amended, or any other applicable federal or state bankruptcy law or similar law,
or Quicktest consents to the appointing of a receiver, liquidator, assignee,
trustee, custodian, or similar office dealing with its property or of any
substantial part of its properties, or consents to the ordering the winding-up
or liquidation of the affairs, or Quicktest shall fail generally to pay its
debts as such debts become due which shall continue in effect for a period of
ninety (90) consecutive days.
(e) Any failure to terminate shall not be construed as a waiver by the
aggrieved party of its rights to terminate for future defaults or breaches.
(f) In the event Xxxxxxxx shall file a petition, answer, or consent seeking
relief under Title 11 of the United States Code, as now constituted or hereafter
amended, or any other applicable federal or state bankruptcy law or similar law,
or Xxxxxxxx consents to the appointing of a receiver, liquidator, assignee,
trustee, custodian, or similar office dealing with its property or of any
substantial part of its properties, or consents to the ordering the winding-up
or liquidation of the affairs, this Agreement shall not be terminated but remain
in full force and effect and all rights of Xxxxxxxx shall continue.
10.3 Effect of Termination:
(a) Upon the termination of this Agreement, each party shall at the request
of the other party return all books, records, documents and data, which it shall
have received from the other party pursuant to this Agreement.
(b) Termination of this Agreement by either party shall not prejudice the
right of Xxxxxxxx to recover, nor excuse the obligations of Quicktest to pay any
Royalty Fee or other payments due at the time of termination or which become due
after termination based upon rights vested prior to termination and shall not
prejudice any cause of action or claim of Xxxxxxxx or accruing under this
Agreement.
(c) Upon termination of this Agreement for any reason whatsoever, Quicktest
shall retain no right in any of Xxxxxxxx'x Patent.
ARTICLE 11
MISCELLANEOUS PROVISIONS
11.1 Execution in Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Initial: MAT QT5
11.2 Notices.
(a) All notices, requests, demands and other communications which are
required or may be given pursuant to the terms of this Agreement shall be in
writing and shall be deemed delivered (i) on the date of delivery when delivered
by hand, (ii) on the date of transmission when sent by facsimile transmission
during normal business hours with telephone confirmation of receipt, (iii) on
the next business day after transmission if sent by facsimile transmission after
normal business hours, (iv) two (2) days after dispatch when sent by a reputable
courier service that maintains records of receipt or (v) five (5) days after
dispatch when sent by registered mail, postage prepaid, return-receipt
requested; provided that, in any such case, such communication is addressed
provided in the immediately following paragraph (b).
(b) All notices, requests, demands and other communications which are
required or may be given pursuant to the terms of this Agreement shall be
addressed as follows:
(i) If to Xxxxxxxx:
Xxxxxxxx Xxxxxx Xxxxxxxx
0000 X. Xxxxxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000 0000
Facsimile: (805) XXXXXXXX
With copy to Xxxxxxxx'x Attorney
Xxxxx X. Xxxxx
000 Xxxxx Xxxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Tel: (000)0000000
Fax:(000)0000000
(ii)If to the Quicktest:
Quicktest 5, Inc.
0000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxxx Xxxxxxx, XX 00000
Initial: MAT QT5
Telephone: (000) 000 0000
Facsimile: (000) 000-0000
or to such other address as any party shall have designated by notice in
the foregoing manner to the other parties.
11.4 Waivers. No waiver of any provision, condition or covenant of this
Agreement shall be effective as against the waiving party unless such waiver is
m writing and is signed by the waiving party.
Waiver by a party as provided in this Section shall not be construed as, or
constitute, either a continuing waiver of such provision, condition or covenant
or a waiver of any other provision, condition or covenant hereof. The failure of
any party at any time to require performance by the other party of any
provision, condition or covenant of this Agreement shall in no way affect its
right thereafter to enforce the provision, condition or covenant.
11.5 Amendment. This Agreement may only be modified, supplemented or
amended by a written instrument executed by the parties to it.
11.6 Entire Agreement. This Agreement (together with the Exhibits expressly
identified in this Agreement) constitutes the entire agreement of the parties
with respect to the subject matter hereof and thereof, and supersedes all prior
agreements and understandings of the parties, oral and written, in respect of
such subject matter.
11.7 Applicable Law: Arbitration; and Consent to Jurisdiction.
(a) This Agreement shall be governed by and construed in accordance with
the laws of the State of California.
(b) The Parties herein agree that all matters, claims or disputes between
the Parties shall be resolved by arbitration shall be referred to, and finally
settled by arbitration in accordance with the provisions of this Section
11,7(b). Either party may elect to commence the arbitration but in any event
such election will only be effective if made by written notice to the other
party hereto. Subject to the provisions hereinafter set forth, the arbitration
shall be conducted and determined in accordance with the rules of the
International Arbitration Rules of the American Arbitration Association, as
modified as follows:
(i) The arbitration shall be conducted with three (3)
arbitrators. Each of Xxxxxxxx and the Quicktest shall appoint one (1) arbitrator
and the two (2) arbitrators thus appointed shall appoint the third arbitrator.
If the two (2) arbitrators fail to agree on the third arbitrator within thirty
(30) days of their appointment, the appointment shall be made, upon request of a
party, by the American Arbitration Association.
Initial: MAT QT5
(ii) The decision of the arbitrators shall be final and binding and
neither party shall appeal the decision on any basis to any court.
(iii) Upon failure, refusal or inability of any arbitrator to act,
his or her successor shall be appointed in the same manner as provided his or her
original appointment.
(iv) The arbitrators shall render the decision and award in writing
with counterpart copies to all parties. The arbitrators shall have no right to modify
the terms of this Agreement. The costs of the arbitration, including the fees
and expenses of counsel, expert and witness fees, and costs of the arbitrators
shall be in the discretion of the arbitrators, who shall have the power to make
any award which is just in the circumstances.
(v) The arbitration proceeding shall take place in Los Angeles. C
alifornia. The arbitrators shall apply the laws of the State of California without
reference to the conflicts of laws thereof.
(c) Any suit, action or proceeding instituted by either party hereto,
including any proceeding to enforce an award of damages by the arbitrators, may
be brought in the courts of the State of California and except to the extent as
otherwise provided in this Section 9.7, said courts shall have exclusive
jurisdiction with respect to all actions, suits, motions, issues or other
matters whatsoever arising out of this Agreement. The parties hereby consent to
in personam jurisdiction of such courts and irrevocably waive any objection and
any right of immunity on the ground of venue, the convenience of forum or the
jurisdiction of such courts or from the execution of judgments resulting
therefrom.
11.8 Assignments. This Agreement may be assigned by either any party hereto
without the prior written consent of the other party. However, in the event
Quicktest assigns its rights and/or obligation under this Agreement, said
assignment is conditioned upon the assignee executing a document and/or
assignment that provides that the assignee shall be obligated for the Royalty
Fee and performance required by Quicktest herein and as amended from time to
time.
11.9 Binding Effect; Benefits. This Agreement shall redound to the benefit
of, and be binding upon, the parties hereto and their respective successors and
permitted assigns. Except for the provisions of Article 8, nothing contained in
this Agreement, express or implied, is intended to confer upon any Person other
than the parties hereto and their respective successors and permitted assigns,
any rights or remedies under or by reason of this Agreement.
11.10 No Joint Venture. Each of the parties hereto is an independent
contractor and neither party is nor shall be considered to be the agent of the
other party for any purpose whatsoever. Neither party has any authorization to
enter into any contracts nor assume any obligations for the other party nor make
any warranties or representations on behalf of the other party, other than as
expressly authorized herein. Nothing in this Agreement shall be construed as
establishing an agency, partnership or joint venture relationship between
the parties hereto.
Initial: MAT QT5
11.11 Conditions Precedent. Each and every provision of this Agreement
shall be contingent and become effective only upon the execution and delivery of
the assignment of Patent.
11.12 Rights of Third Parties Xxxxxxxx herein agrees and acknowledges that
Xxxxx X. Xxxxx is to receive Twenty (20%) of his interest in the Royalties and
stocks granted under this Agreement. Further, Xxxxxx Xxxxxx is to receive
Twenty-five (25%) of the remaining eighty (80%) of the interest in Xxxxxxxx'x
Royalty and stocks under this Agreement.
11.12 Exhibits and Other Agreements.
(a) The Exhibits and other agreements specifically referred to in, and
delivered pursuant to, this Agreement are an integral part of it.
(b) The following are the Exhibits annexed hereto and incorporated by
reference and deemed to be part hereof:
(i) Exhibits:
Exhibit A - True and correct copy of Patent
Exhibit B - Performance Goals
Exhibit C - Patent Assignment
IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto,
all as of the date first above written.
XXXXXXX XXXXXX XXXXXXXX QUICKTEST 5, INC.
DATE: 4-7-02 DATE: 4-7-02
BY:__________________________ BY:_________________________
Initial: MAT QT5
EXHIBIT "B"
3.3 Performance Goals: Quicktest agrees that the following Performance
Goals shall be met by Quicktest as a condition to the continuance of this
Agreement. It is the intent of this Agreement that the Quicktest will satisfy
these goals on a yearly basis. Failure to due so will constitute grounds for
termination. Said Performance Goals are set forth in this Exhibit "B"
(a) During the first year, Quicktest shall have a sold a minium of Five
Hundred Thousand (500,000) cases of its product in which Xxxxxxxx is entitled to
a Licensed Fee.
(b) During any year thereafter for each year during the balance of the term
of this Agreement, Quicktest shall have a sold a minimum of One Million
(1,000,000) cases of its products in which Xxxxxxxx is entitled to a Royalty
Fee.
Initial: MAT QT5
EXHIBIT "C'
PATENT ASSIGNMENT
WHEREAS, Xxxxxxx Xxxxxx Xxxxxxxx, is the owner an inventor of that certain
United State Patent No. 6,368,386, Patent registrations and applications in the
form more fully described in Exhibit A hereto (the "U.S. Patent");
WHEREAS, Marshal Aniauf Xxxxxxxx and Quicktest 5, Inc. a Delaware
corporation ("Quicktest") have executed that certain Agreement for the License
of Patent Rights,
WHEREAS, pursuant to the terms of the Agreement for the License of Patent
Rights, Xxxxxxx Xxxxxx Xxxxxxxx desires to assign and Quicktest desires to
receive all of Xxxxxxx Xxxxxx Xxxxxxxx'x right, title and interest in and to the
U.S. Patent together with any and all enhancements together with the goodwill
associated therewith.
NOW THEREFORE, for the consideration set forth in the Agreement for the
License of Patent Rights, and other good and valuable consideration, the
receipts and sufficiency of which is hereby acknowledged, Xxxxxxxx Xxxxxx
Xxxxxxxx hereby sells, transfers, assigns and sets over unto Quicktest 5, Inc.,
a Delaware corporation, its successors and assigns, all of Xxxxxxx Xxxxxx
Xxxxxxxx'x entire right, title and interest in and to the Patent, in the United
States of America and all foreign countries, together with the good will of
Xxxxxxx Xxxxxx Xxxxxxxx'x business, all common law rights related thereto, all
rights of renewal and extension, and the right to recover for damages and
profits for past infringements thereof.
Xxxxxxxx Xxxxxx Xxxxxxxx agrees to execute and deliver at the request of
Quicktest 5, Inc., all papers, instruments, and assignments, and to perform any
other reasonable acts the Quicktest 5, Inc. may request in order to vest all of
Xxxxxxxx Xxxxxx Xxxxxxxx' right, title and interest in and to the U.S. Patent
and/or to provide evidence to support any of the foregoing in the event such
evidence is deemed necessary by Quicktest 5, Inc. to the extent such evidence is
in the possession or control of Xxxxxxxx Xxxxxx Xxxxxxxx.
Executed as of the 7th Day of April, 2002
/s/ Xxxxxxxx Xxxxxx Xxxxxxxx
-----------------------------
XXXXXXXX XXXXXX XXXXXXXX
Initials: MAT QT5
