LICENSE, MARKETING AND DISTRIBUTION AGREEMENT
This
License, Marketing and Distribution Agreement (“
Agreement ”) is made effective as of March 7,
2008, among:
JUST-IN CASE FIRE LTD ., an Alberta registered corporation
(“ Licensee ”),
MOHSEN C. AMIRAN, PHD an individual resident in Illinois
(“ Amiran ”),
SUMMIT ENVIRONMENTAL CORPORATION, INC ., a Texas corporation
(“ Summit ”); and
BIOGENESIS Enterprises Inc. an Illinois corporation (“
BioGenesis ”).
WHEREAS , Amiran is a
technical expert in physical organic chemistry and has invented,
designed and developed FlameOut, as hereinafter defined, the patent
and intellectual property rights to which are owned by
Summit;
WHEREAS , Licensee has
developed an on-demand suppression system for suppressing fires
using self-contained, portable, mechanized equipment developed by
Licensee in combination with chemical formulations utilizing
FlameOut;
WHEREAS , BioGenesis
currently manufactures FlameOut for Summit;
WHEREAS, Licensee desires to
exclusively develop certain markets and distribute FlameOut in
those markets; and
WHEREAS , Summit is willing
to grant to Licensee an exclusive license to market and distribute
FlameOut in certain defined territories they develop, and to grant
the Licensee the limited right to practice the FlameOut Patent for
the purposes of preparing FlameOut for sale.
NOW THEREFORE IN
CONSIDERATION of the mutual covenants and agreements herein
contained and for other good and valuable consideration, the
receipt and sufficiency of which is acknowledged by the Parties
hereto, the Parties agree as follows:
ARTICLE 1 INTERPRETATION
In this
agreement:
“
Affiliate ” means: (i) any Person directly or
indirectly controlling, controlled by or under common control with
said Person (including any partnership in which such Person serves
as a general partner, any corporation in which such Person owns
greater than 5% of the issued and outstanding voting capital stock
or any limited liability company or joint venture in which such
Person owns greater than 5% of the equity interests); and
(ii) any officer, director, trustee or
Exhibit 10.10 – Page 1
general
partner of any Person so controlling, controlled by or under common
control with said Person.
“
Business Day ” means Monday through Friday, except a
holiday designated by the federal government of the United States
as a national holiday.
“
Effective Date ” means March 7th, 2008.
“
Flame Out ” means the product produced from FlameOut
Bulk by the Licensee, suitable for sale to customers of the
Licensee.
“
FlameOut Patent ” shall mean the formula and
specifications related to US Patent 6296781 filed October 2nd,
2001, and any improvements to such patent whether patentable or
not.
“
FlameOut Bulk ” shall mean the bulk chemical agent
manufactured by Summit and/or BioGenesis according to the formula
and specifications of the FlameOut Patent.
“
Notice ” means any notice, citation, directive, order,
claim litigation, investigation, proceeding, judgment, letter or
other communication, written or oral, actual or threatened, from
any Person.
“
Parties ” means all of the parties to this Agreement
and “Party” means any one of them.
“
Person ” means any individual, partnership, joint
venture, limited liability company, corporation, trust,
unincorporated entity, association, sole proprietorship or other
entity, including any such entity controlled, directly or
indirectly, or under common control by such entity, or a federal,
state or local governmental body or unit or agency thereof.
“
Term ” has the meaning specified in Section 14 of
this Agreement.
“
Territory ” means Canada, New Zealand, Australia,
Kuwait, Tunisia, Nigeria, Thailand and Switzerland.
“
Trademarks ” mean the means the registered and
unregistered trade names and trade-marks used in association with
FlameOut, and listed in Schedule A to this Agreement.
Captions and Headings . The captions and section headings
used in this Agreement are for convenience of reference only and
shall not be deemed to expand, contract, alter or restrict any term
or condition herein. All references herein to sections and exhibits
shall be deemed references to such parts of this Agreement, unless
the context shall otherwise require.
Gender. All references to the masculine, feminine or neuter
gender, or to the singular or plural, shall include the other as
the context may require.
Exhibits and Schedules . The exhibits and schedules attached
hereto are a part of this Agreement as if fully set forth
herein.
Exhibit 10.10 – Page 2
Recitals. The recitals shall form part of this
Agreement.
Currency. All dollar figures herein shall be expressed in
United States dollars, unless otherwise specified.
General. The use of the terms “including” or
“include” shall in all cases mean “including,
without limitation” or “include, without
limitation,” respectively. Reference to any agreement
(including this Agreement), document or instrument means such
agreement, document or instrument as amended or modified and in
effect from time to time in accordance with the terms thereof and,
if applicable, the terms hereof. The use of the terms
“hereunder,” “hereof,” “hereto”
and words of similar import shall refer to this Agreement as a
whole and not to any particular section or clause of or exhibit or
schedule to this Agreement.
ARTICLE 2 GRANT OF LICENSE
Subject
to the terms of this Agreement, Summit hereby grants to Licensee to
the extent permitted by the laws of each relevant jurisdiction, and
Licensee hereby accepts from Summit:
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(a) |
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the limited, non-exclusive right and license to use and
practice the FlameOut Patent for the sole purpose of
combining the FlameOut Bulk with water to create FlameOut for
distribution and sale in the Territory; and |
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(b) |
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the exclusive right and license to market, distribute and other
exploit FlameOut throughout the Territory. |
| 2.2 |
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Trade-mark and Copyright License |
Subject
to the terms of this Agreement, Summit hereby grants to Licensee,
and Licensee herby accepts from Summit:
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(a) |
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the exclusive right to use the Trade-marks in association with
FlameOut throughout the Territory; |
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(b) |
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the exclusive right to sub-license the Trade-marks for use in
association with FlameOut in the territory; and |
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(c) |
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the exclusive right to use, copy, reproduce, broadcast and
otherwise exploit the copyright and other intellectual property
rights in any manuals, marketing or other materials related to
FlameOut. |
Exhibit 10.10 – Page 3
ARTICLE 3 MANUFACTURING, MARKETING AND
DISTRIBUTION
| 3.1 |
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Manufacturing of FlameOut Bulk |
Summit
or BioGenesis shall use commercially reasonable efforts to
manufacture FlameOut Bulk for Licensee, in accordance with industry
standards and government and other regulatory body guidelines. The
FlameOut Bulk shall at all times meet and exceed the quality and
safety standards prescribed by the Underwriter Labs.
Summit
or BioGenesis, as the case may be, shall manufacture FlameOut Bulk
in quantities to be determined and communicated by the Licensee on
a quarterly basis.
Summit
shall upon request of the Licensee provide samples of FlameOut Bulk
and FlameOut, free of charge, for the purposes of marketing
FlameOut to new customers.
In the
event that Summit and BioGenesis are no longer able to manufacture
FlameOut Bulk in accordance with the terms of this Agreement the
Licensee may practice the FlameOut Patent, or sub-license the right
to practice the FlameOut patent to the extent required to
manufacture FlameOut Bulk or contract a third party to manufacture
FlameOut Bulk.
Licensee, by and through its managers, consultants and
representatives, shall have the right, during reasonable hours and
upon reasonable notice to Summit or BioGenesis as the case may be,
to inspect the research, testing, development, manufacturing,
marketing, sales and corporate facilities for FlameOut Bulk.
Further, the Licensee shall have the right to inspect the
procedures and protocols in the area of production, including, but
not limited to, situations where demand exceeds capacity, FlameOut
is no longer meeting quality standards, or during a natural
disaster.
| 3.2 |
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Production of FlameOut |
Licensee
shall blend FlameOut Bulk with water, in accordance with the
instructions of Summit and BioGenesis, as the case may be, to
produce FlameOut. Such blending will take place in facilities
supplied by the Licensee.
Summit
and BioGenesis, by and through their managers, consultants and
representatives, shall have the right, during reasonable hours and
upon reasonable notice to Licensee to inspect the research,
testing, development, manufacturing, marketing, sales and corporate
facilities where the Licensee is blending FlameOut. Further, Summit
and BioGenesis shall have the right to inspect the procedures and
protocols in the area of production, including, but not limited to,
situations where demand exceeds capacity, FlameOut is no longer
meeting quality standards, or during a natural disaster.
Licensee
shall purchase FlameOut Bulk at the price set out in
Schedule B to this Agreement. Summit may modify the prices set
out in Schedule B, on a biannual basis from the Effective
Date, according to the following schedule: September 7th, 2008;
March 7th, 2009; September 7th, 2009; March 7th, 2010, and so on
and so forth, by providing Notice to the Licensee sixty
Exhibit 10.10 – Page 4
(60) days prior to the effective day of the price change. In
no event will the price of FlameOut Bulk increase by more than 3%
in any given calendar year.
Licensee
may set and adjust the retail price of FlameOut charged to its
customers in its sole discretion.
Licensee
shall use commercially reasonable efforts to, during the term of
this Agreement, introduce, market, and otherwise promote the sale
of FlameOut in the Territory. Licensee agrees to devote as much
time, attention and resources as may be commercially reasonable to
properly conduct such activities and to bear the entire cost and
expense of conducting its activities hereunder, including, if
necessary, the maintenance of its own office space, office
facilities and competent personnel.
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Sales and Distribution |
Licensee
shall sell and distribute FlameOut in the Territory.
Beginning in the second year of the Term the Licensee and Summit
may mutually agree on sales targets for the second and subsequent
years of the Agreement. Such sales targets will be based on
historical and projected sales and will be documented in writing
and added to this Agreement as Schedule D.
Licensee
shall submit orders for FlameOut Bulk to Summit and/or BioGenesis,
as the case may be, on a monthly basis using an order form
substantially the same as the form set out in Schedule C.
Summit or BioGenesis, as the case may be, shall provide the
quantity of FlameOut ordered to the Licensee within five
(5) days of receipt of the order.
At the
time of delivery of the said order Summit or BioGenesis, as the
case may be, shall issue the Licensee an invoice for the FlameOut
Bulk supplied. Such invoice will be due and payable thirty
(30) days from receipt. Late payments will be subject to a fee
of 1.5% monthly, with a minimum fee of 1.5%.
| 3.7 |
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Reporting Obligations |
Licensee
shall provide to Summit, on a quarterly basis, a written report
showing the amount of FlameOut sold for the relevant quarter,
including all pricing and any applicable discounts.
Exhibit 10.10 – Page 5
ARTICLE 4 OWNERSHIP AND PROTECTION OF INTELLECTUAL
PROPERTY
| 4.1 |
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Ownership of FlameOut Patent |
Licensee
recognizes and acknowledges that Summit is the owner of the
FlameOut Patent and all related intellectual property. Nothing in
this Agreement should be construed as a transfer of intellectual
property from any Party to Licensee other than the license rights
granted herein.
| 4.2 |
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Ownership of Improvements |
During
the term of this Agreement, for the benefit of the Parties, Summit,
Amiran and BioGenesis shall use their best efforts to further
develop FlameOut Bulk, and notify the Licensee of such
improvements.
In the
event that the Licensee makes any improvements to the FlameOut
Patent or FlameOut, the Licensee shall promptly notify Summit of
such improvements and Summit shall own such intellectual property
rights and grant a license to use and exploit such intellectual
property rights to the Licensee on the same terms as the grant of
license herein.
| 4.3 |
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Ownership of Trade-marks |
The
Licensee may seek registration of the Trade-marks or any other
trade-mark for use in association with FlameOut in any country of
the Territory at its own expense. The Licensee shall own such
trade-mark registrations and all associated rights and accrued good
will, in accordance with the terms of this Agreement.
| 4.4 |
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Protection of Intellectual Property |
Licensee
shall use commercially reasonable efforts to cooperate with Summit
in the vigilant and diligent protection and enforcement of
Summit’s intellectual property rights including, without
limitations, any rights under the patent, copyright, trademark or
trade secret law of any country in the world.
Each
Party shall promptly inform the other Parties in writing of any
reasonably suspected or known infringement of any intellectual
property rights embodied in the FlameOut Patent, FlameOut, FlameOut
Bulk or any improvements thereto and the Trademarks or any other
form of intellectual property otherwise associated with FlameOut.
Such notice shall, to the extent feasible, identify the suspected
or known infringing party or parties and the nature and extent of
the infringement. Summit, at its option shall prosecute all
infringement and related claims that may be brought against any
Party based on or related to the aforedescribed intellectual
property rights. Should Summit choose not to prosecute a related
claim, Licensee, Amiran or BioGenesis shall have the option to
prosecute said claim. The cost of such prosecution,
attorneys’ fees and all litigation related expenses, shall be
borne by the Party that chose to prosecute the related claim.
Exhibit 10.10 – Page 6
ARTICLE 5 REPRESENTATIONS AND WARRANTIES
| 5.1 |
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Licensee Representations and Warranties |
Licensee
hereby represents and warrants to Summit that:
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(a) |
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Licensee is a corporation duly organized, validly existing and
in good standing under the laws of Canada, has all requisite power
and authority to own, lease and operate its properties and assets
and to conduct its business as now being conducted. |
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(b) |
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Licensee has the corporate power and authority to enter into
this Agreement and to carry out its obligations hereunder. The
execution and delivery of this Agreement and the performance by
Licensee of its obligations thereunder have been duly approved by
Licensee and no other internal corporate proceedings on the part of
Licensee are necessary to authorize such execution, delivery and
performance. When this Agreement has been duly executed by
Licensee, it shall constitutes the valid and legally binding
obligation of Licensee enforceable against it in accordance with
its terms. |
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(c) |
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Absence of Conflicts. The execution, delivery and performance
by Licensee of this Agreement, and the transactions contemplated
herein, do not and will not conflict with or result in any
violation of or constitute a breach or default under any term of
the articles of organization or operating agreement of Licensee, of
any agreement, permit or other instrument to which Licensee is a
party, or by which Licensee is bound or any judgment to which
Licensee is bound. |
| 5.2 |
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Summit Representations and Warranties |
Summit
hereby represents and warrants to Licensee that:
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(a) |
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Summit is a corporation duly organized, validly existing and in
good standing under the laws of the State of Texas and each
jurisdiction where failure to be so qualified would be a violation
of the law of such jurisdiction, has all requisite power and
authority to own, lease and operate its properties and assets and
to conduct its business as now being conducted. |
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(b) |
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Summit has the power and authority to enter into this Agreement
and to carry out its obligations hereunder and thereunder. The
execution and delivery of this Agreement and the performance by
Summit of its obligations thereunder have been approved by the
Summit board of directors and no other internal proceedings on the
part of either are necessary to authorize such execution, delivery
and performance. When this Agreement has been duly executed by
Summit it shall constitute the valid and legally binding obligation
of each enforceable against it in accordance with its terms. |
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(c) |
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The execution, delivery and performance by Summit of this
Agreement, and the transactions contemplated hereby and thereby, do
not and will not conflict with or |
Exhibit 10.10 – Page 7
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result in any violation of or constitute a breach or default
under any term of the operating agreement of Summit, of any
agreement, permit or other instrument to which Summit is a party,
or by which Summit is bound or any judgment to which Summit is
bound. |
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(d) |
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The FlameOut Patent is valid and owned by Summit and to the
knowledge of Summit doesn’t infringe any existing patent or
other intellectual party rights of any third party and is not the
subject of any potential or existing claim(s) of infringement of
intellectual property rights. |
| 5.3 |
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BioGenesis Representations and Warranties |
BioGenesis hereby represents and warrants to Licensee that:
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(a) |
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BioGenesis is a corporation duly organized, validly existing
and in good standing under the laws of the State of Illinois and
each jurisdiction where failure to be so q |
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