Exhibit 10.11
MARKETING and LICENSE AGREEMENT
THIS AGREEMENT,
effective this 1st day
of May 2002 ("Agreement Date"), is
between Tradewinds Oil and Gas International, Ltd. ("Tradewinds"), a Texas
limited partnership having offices at 8811
Gaylord, Suite 200,
Houston, Texas
77024 or its Designee, and Imperial
Petroleum Recovery Corporation ("Imperial"),
a Nevada corporation having offices at 1970 South
Starpoint Drive, Houston,
Texas 77032.
1. BACKGROUND
1.1 Imperial has developed certain
Microwave Separation
Technology (MST)
for breaking or separating Emulsions based on microwave energy and has the
capability, as hereinafter defined, to market, make or have made Microwave
Separation Technology Equipment for
leasing, licensing or sale to MST Customers,
and to provide MST Technical and MST Maintenance Support to MST Customers
leasing, licensing or purchasing the
Microwave Separation Technology Equipment;
1.2 Tradewinds and its affiliates have the capabilities, hereinafter
defined, to market Microwave Separation Technology Equipment in the Field of
Use;
1.3 Imperial, hereby, appoints Tradewinds to be its exclusive
licensee
having exclusive use of the Microwave
Separation
Technology
(MST) within the
nations of Indonesia and Singapore for
Microwave Separation Technology Equipment
products in the Field of Use, and to work closely with Tradewinds in the
research, development and testing of such products on
the terms and conditions
set forth in this Agreement. Tradewinds
accepts such appointment.
NOW,
THEREFORE,
intending to be
legally bound,
Imperial and
Tradewinds
agree as follows:
2. DEFINITIONS
2.1 Microwave Separation Technology means patented
equipment,
processes,
trade secrets, and know how, pertaining to Imperial Intellectual Property
Rights, for separating or breaking
emulsions using microwave energy.
2.2 Microwave Separation Technology
Unit (MSTU)
a. The MSTU means Microwave
Separation Technology Equipment that contains
a microwave
transmitter
having a total power output of up to
seventy-five (75)
kilowatts (designated MST-1000), or more if
commercially
available. Microwave
Separation
Technology
Equipment
having two or more Microwave Separation Technology Units would
contain
microwave transmitters
having total power output up to 75
kilowatts
multiplied by the number of units.
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b. The MSTU will generally include a system for exposing sludge or an
Emulsion to
microwave energy such as a microwave generator, wave
guides, an
applicator,
pump, piping and electrical that may be
connected to at least one holding tank and/or a separation
device for
processing organic liquids, aqueous liquids and/or solids.
This term,
MSTU, is interchangeable with "Product".
2.3 Field of Use means any process or
operation related to: recovering
hydrocarbons from a naturally occurring reservoir or similar natural source;
which will allow refining of such
hydrocarbons into intermediates, such as a gas
oil, or final products, such as gasoline;
and/or manufacturing of petrochemicals
and/or petrochemical feedstocks. Field of
use includes the clean up and recovery
of hydrocarbons due to spills, ruptures or
similar events. Field of use includes
any process, within the petroleum and
petrochemical industries, employing Radio
Frequency (RF) energy, jointly agreed to by
Imperial and Tradewinds, to provide
a viable economic application for the MST
technology.
Applications may include,
but not be limited to, recovery of
hydrocarbons from sludge tanks, sludge pits,
tanker / ship bottoms, as well as
remediation of environmental problems created
by hydrocarbon spills, pipeline leaks, process upsets, and other hydrocarbon
related upsets.
2.4 "Product" or "Products" shall mean all products manufactured and
controlled by Imperial on the date of the execution of this Agreement and
includes any improvements or replacements to such products. It shall also
include all future products manufactured by Imperial with an
application within
the Field of Use.
2.5 Territory shall mean nations of
Indonesia and Singapore.
2.6 Term of Agreement shall mean the period during which this License
Agreement is in effect as set forth in
Article 6, Section
6.2 and Article
12,
Section 12.1.
2.7 Emulsion means a petroleum
material fed into the Microwave Separation
Technology Equipment containing a
suspension of immiscible liquid phases, and/or
a suspension of one or more solids and one
or more liquid phases.
2.8 Imperial Intellectual Property Rights mean all patents (including
patent applications), copyrights and trademarks for Microwave Separation
Technology owned by Imperial. Imperial Intellectual Property
Rights include the
associated know how for making, using,
sublicensing,
leasing, marketing, and
selling Microwave Separation
Technology.
2.9 MST Maintenance Support means all routine, preventive, and/or
emergency maintenance or service performed
on Microwave
Separation
Technology
Equipment.
2.10 MST
Customer means any lessee, licensee, or purchaser of Microwave
Separation Technology Equipment.
2.11 Cost of
Product (COP) means
the price for the
purchase of
Microwave
Separation Technology Equipment to include the MST
equipment purchased,
hood
boxing, port delivery to Houston, Houston port charges, agency and
documentation, insurance and ocean freight
delivered ex quay port of (named port
of destination, for example Jakarta or Singapore),
commissioning
and start-up
engineering support, training and first year warranty
maintenance
related to
delivery of the MST system to the named
Port of Destination
(Delivered Ex Quay)
and the installation of the MST Equipment
at the Customer's chosen location.
2.12 Tradewinds
means Tradewinds Oil
and Gas International,
Ltd. a Texas
Limited Partnership and its Affiliates or
Designee. The term
"Affiliate" shall
mean any company, partnership or joint venture
controlled
by, controlling or
under common control with Tradewinds or any
Tradewinds appointed
Designee. For
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the purposes of this definition, "control" means the direct or indirect
beneficial ownership of fifty percent (50%) or more of the stock
entitled to
vote in the election of directors
or, if there is no
such stock, fifty
percent
(50%) or more of the ownership interest in such company,
partnership
or joint
venture.
2.13 MST
Technical Support
means all support provided by Imperial and / or
Tradewinds to MST Customers and potential MST Customers for MST
Equipment or
Laboratory Technology that includes, but is not limited to,
training of MST
Customer personnel, assistance during the
start-up and testing of MST Equipment,
troubleshooting technical problems in an MST
application that is not performing
to a MST Customer's satisfaction, response to a MST Customer's request for
technical assistance to optimize the MST Equipment, and technical support
services.
2.14 Equipment
Cost means the costs as shown in Section 6.4 of major
equipment and fabrication labor necessary to construct MST
Equipment, deliver
the system ex quay to the named
port of destination, the commissioning and
start-up support required to prepare the system for
operation,
and operator
training costs.
2.15 Delivered
Ex Quay (DEQ) means that the seller delivers when the goods
are placed at the disposal of the buyer not cleared for import on the quay
(wharf) at the named port of destination.
The seller has to bear costs and risks
involved in bringing the goods to the named
port of destination
and discharging
the goods on the quay (wharf). The DEQ term requires the buyer to clear the
goods and pay for all formalities, duties
taxes and other charges upon import.
3. RIGHTS GRANTED
3.1 Imperial grants Tradewinds, and Tradewinds accepts, subject to the
terms and conditions set forth,
herein, including Paragraph 3.2, an exclusive
license and right to market Microwave Separation Technology under Imperial's
Intellectual Property Rights within the nations
of Indonesia and Singapore. In
addition, if during the term of this
agreement Tradewinds identifies and brings
to Imperial contracts for business
within countries outside of Singapore and
Indonesia not represented on an exclusive
basis by another
entity, Tradewinds
shall be entitled to participate with
Imperial in the business developed outside
of Indonesia and Singapore.
3.2 Imperial has extended its
marketing agreement
with ____________ to
permit them to market the MST within the __________ organization on a
non-exclusive basis. If Tradewinds markets MST units to _________
facilities
within Indonesia or Singapore, Tradewinds
will pay the Cost of Product (COP) for
all units Tradewinds places within ___________ Singapore or Indonesian
operations.
3.3 Except as provided herein, Tradewinds shall be responsible for all
costs associated with the conduct of its marketing,
including commissions or
other compensation to sales representatives
employed by
Tradewinds.
Tradewinds
will be responsible for the costs incurred to move the MST equipment
from the
Port of Destination within Indonesia or Singapore to
the installation site, the
costs of site preparation, and the lodging, food, travel and living expenses
within Indonesia or Singapore for any
Imperial Petroleum
Recovery Corporation
personnel involved in the installation, training and equipment maintenance
efforts.
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4. SERVICES PROVIDED BY
IMPERIAL
4.1 Imperial will be responsible for making or having made the
Microwave
Separation Technology Equipment for each order placed by
Tradewinds.
Imperial
will oversee the manufacturing and delivery
of Microwave
Separation
Technology
Equipment to the named port of destination
(Delivered Ex Quay), defined for this
agreement as the port city identified by
Tradewinds closest to
the installation
site, capable of receiving and
offloading
the MST from the ocean
going vessel
contracted to move the equipment from its
manufactured location,
or the Port of
Houston, Texas. Imperial will fabricate,
test and commission the unit based upon
the information provided by Tradewinds for
its customer's site.
Tradewinds will
perform, or have performed the site
preparation
work and the
installation and
connections required to operate the MST Unit. Imperial will train up to 10
operators in the use of the MST and insure
that the unit is functioning properly
after installation. Imperial will provide a 12 month warranty on parts and
labor. Title to the Products shall vest in Buyer immediately upon payment to
Seller of the Cost of Product.
4.2 Imperial will provide, in a form that complies with industry
standards, an operating manual, safety
manual, process flow diagrams, piping and
instrumentation diagrams, and wiring
diagrams and will provide at least 20 hours
of training for each MST Customer. Imperial will also provide MST Technical
Support, as defined herein, to
Tradewinds.
4.3 Imperial will provide to Tradewinds training as per Article 4.4,
technical and laboratory support with respect to the use, application and
quality of Product as specified by
Imperial.
4.4 Imperial will provide at its cost MST
Installation
and Maintenance
Support, as defined herein, to each
Tradewinds MST Customer. Imperial standard
overseas commissioning package provides
field supervision for 2 engineers, for a
maximum of 34 days. Tradewinds will provide for commercial standard, local
lodging, transportation and meals. If
installation requires
more than 34 days,
the additional days will be billed to Tradewinds
or its Designee at $1,000 per
engineer per day and Tradewinds will provide for commercial standard, local
lodging, transportation and meals. If
onsite training is requested, the standard
operator-training package is presented in English and includes 14 days of
hands-on training for up to 10 operators.
Additional
engineering and
training
support is available at $1,000 per
engineer/instructor
per day (travel to
and
from, and onsite) plus airfare and
lodging. The standard
Maintenance
Support
includes two semi-annual maintenance
on-site inspections during the first twelve
months following commissioning. Imperial will bear all costs of the
standard
Maintenance Support package except for the in-country expenses of
transportation, lodging and meals on a
commercial standard basis incurred by the
engineer(s) assigned the maintenance and inspection function. The standard
packages may be modified as to number of
Imperial personnel and days on site, as
requested by Tradewinds.
4.5 Imperial will provide and maintain bench unit test facilities and
personnel for testing Emulsions from potential MST Customers. Imperial will
coordinate with Tradewinds to obtain access
to additional
laboratory
equipment
as may be required, from time to time, to provide adequate evaluation of MST
Customer emulsions.
5. SERVICES PROVIDED BY
TRADEWINDS
5.1 Marketing. Tradewinds will use commercially reasonable efforts to
develop the market for the Microwave
Separation Technology
within Indonesia and
Singapore.
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5.2 Marketing services provided by Tradewinds
shall include, but are
not
limited to, developing a technology fact
sheet, including
Microwave
Separation
Technology on the Tradewinds Web site, disseminating information related to
Microwave Separation Technology to sites partially or
fully owned, operated
or
serviced by Tradewinds. Tradewinds will also use
reasonable efforts, at its own
discretion, to publicize Microwave Separation
Technology, including
presenting
papers and publications, and
advertising.
5.3 Tradewinds will be responsible for the costs incurred once the MST
equipment has been Delivered Ex Quay (DEQ)
at the named port of destination, to
clear customs and move the MST equipment to
the installation site,
the costs of
site preparation, and the lodging, food, travel and living expenses within
Indonesia or Singapore for any Imperial
Petroleum Recovery Corporation personnel
involved in the installation, training and
equipment maintenance efforts.
6. TERMS
6.1 Tradewinds will pay Imperial a
licensing fee of _______________ for a
two year license agreement. In exchange for this and other consideration,
Imperial grants an exclusive license to Tradewinds to market Microwave
Separation Technology products within the
Field of Use throughout Indonesia and
Singapore for two years beginning 1 May 2002 and running
through 30 April 2004.
Tradewinds will prepay the licensing fee at
a rate of
______________ per
month
for six months beginning November 2001 and continuing
through April 2002.
The
sixth payment (April 2002, or earlier as
determined by Tradewinds) will complete
the payment schedule for the two-year term
of the agreement.
6.2 The license agreement is effective May 1, 2002
and runs for two years
through April 30, 2004. Contracts generated by Tradewinds in the
Field of Use
within Indonesia and Singapore prior to May 1, 2002 will be
honored for their
exclusivity to Tradewinds as if they were
concluded on or after May 1, 2002.
6.3 The li
