Exhibit 10.56
INTELLECTUAL PROPERTY LICENSE
AGREEMENT
This INTELLECTUAL PROPERTY LICENSE
AGREEMENT is made and entered into and effective as of
October 1, 2008, by and between ADA-ES, Inc., a Colorado
corporation (“ Licensor ”), and Crowfoot
Development, LLC, a Delaware limited liability company (“
Licensee ”). Licensor and Licensee are hereinafter
referred to individually as a “ Party ” and
collectively as the “ Parties .”
WHEREAS, Energy Capital Partners I,
LP, Energy Capital Partners I-A, LP, Energy Capital Partners I-B
IP, LP, and Energy Capital Partners I (Crowfoot IP), LP,
(collectively, the “ ECP Parties ”) and Licensor
are parties to a the Joint Development Agreement, dated as of
October 1, 2008 (“ Joint Development Agreement
”);
WHEREAS, Licensor has established
Licensee to serve as the vehicle through which Licensor and the ECP
Parties will jointly engage in the ownership and development,
directly or indirectly, of activated carbon production and supply
facilities;
WHEREAS, pursuant to the Joint
Development Agreement, Licensor agreed to transfer, convey, assign
and deliver to Licensee certain assets of Licensor used or held for
use in connection with the Business (as defined below);
WHEREAS, Licensor is the owner of
certain Intellectual Property (as defined herein) used or held for
use in connection with the Business or otherwise relating to the
ADA-ES Contributed Assets and/or the Underlying Assets that will be
retained by Licensor following the Closing, and Licensor may in the
future own certain Intellectual Property that relates to the
manufacture, production, processing and/or supply of activated
carbon for the control of mercury emissions from coal fired power
plants; and !
WHEREAS, Licensee desires to obtain,
and Licensor is willing to grant to Licensee and its Affiliates, a
license to the Licensed Intellectual Property (as defined
herein).
NOW, THEREFORE, in consideration of
the foregoing as well as the terms and conditions herein, the
Parties hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions
. For the purposes of this Agreement, (a) unless otherwise
defined herein, capitalized terms used herein shall have the
meanings assigned to them in the Joint Development Agreement, and
(b) the following terms shall have the meanings hereinafter
specified.
“ After-Filed Patents
” means those patents or patent applications claiming a
filing date on or after the Closing Date that are owned by Licensor
or any of its Affiliates and that are directed to any Intellectual
Property used or held for use in connection with the
* indicates portions of the exhibit that have been
omitted pursuant to a request for confidential information. The
non-public information has been filed with the
Commission.
Business or otherwise relating to the ADA-ES
Contributed Assets and/or the Underlying Assets, but are not
included in the ADA-ES Contributed Assets or the Underlying Assets,
but excluding any modifications, improvements or enhancements to
such Intellectual Property conceived or created after the Closing
Date.
“ Agreement ”
means this Intellectual Property License Agreement, including the
Schedules attached hereto, as the same may be amended, modified or
supplemented from time to time.
“ Competitor ”
means any Person in the air pollution control industry with more
than $10 million per year in gross revenues of activated carbon for
mercury control emissions in power plants (the “ Gross
Revenue Threshold ”), which Gross Revenue Threshold will
be increased annually by multiplying the Gross Revenue Threshold
for the immediately preceding calendar year by a factor equal to
the amount of the increase, if any, in the annual figure for the
Consumer Price Index for the immediately preceding calendar year,
over the annual figure for the Consumer Price Index of the
preceding calendar year; provided , however , that a
“Competitor” shall not include any private equity fund
or other financial buyer that owns any interest in a Person that
would otherwise be a “Competitor” hereunder.
“ Consumer Price Index
” means the “Consumer Price Index for Urban Wage
Earners and Clerical workers (1967 = 100)” specified for
“All Items – United States” compiled by the
Bureau of Labor Statistics for the United States (“
Index ”). In the event the Index is hereafter
converted to a different standard reference base or otherwise
revised, the determination of the percentage change shall be made
with the use of such conversion factor, formula or table for
converting the Index as may be published by the Bureau of Labor
Statistics or, if said Bureau does not publish the same, then as
shall be reasonably determined by the Parties.
“ Excluded Affiliates
” means any Affiliate that is (i) a natural person,
(ii) an upstream Affiliate of Licensor that holds less than
Fifty Percent, or (iii) a downstream Affiliate of Licensor of
which Licensor holds less than Fifty Percent. “Fifty
Percent” means 50% of the total number of outstanding common
or other equity interests (however denominated) of such Person, 50%
of the total voting power of all outstanding equity interests of
such Person which are entitled to vote in the election of
directors, managers or other persons performing similar functions
for and on behalf of such Person, 50% of the dividends paid and
other distributions made by such Person prior to liquidation or 50%
of the assets of such Person or proceeds from the sale thereof upon
liquidation.
“ Field ” means
the manufacture, production, processing and/or supply of activated
carbon for (i) the control of mercury emissions from coal
fired power plants or (ii) any application or use competitive
with the control of mercury emissions from coal fired power
plants.
“ Future Licensing
Period ” means the period commencing after the Closing
and ending at such time as (i) Licensor no longer holds
(x) if during the five-year period following the Closing Date,
any membership or other equity interest in Licensee, and
(y) if at any time after such initial five-year period, the
right to designate at least one Manager to the Licensee’s
Board of Managers, or (y) any of the ECP Parties transfers its
membership or other equity interest in Licensee to a
Competitor.
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“ Intellectual Property
” means all intellectual property and proprietary rights,
including (i) all inventions (whether patentable or
unpatentable and whether or not reduced to practice), all
improvements thereto, and all patents, patent applications, and
patent and invention disclosures, together with all provisionals,
reissuances, continuations, continuations-in-part, divisions,
revisions, extensions, and reexaminations thereof, (ii) all
trademarks, service marks, trade dress, logos, slogans, brand
names, trade names, domain names, and business and product names,
and all applications and registrations therefor, and all extensions
and renewals thereof, and all goodwill of the business connected
with the use of and symbolized by the foregoing (the “
Trademarks ”), (iii) all copyrights and
copyrightable works, all mask works, industrial designs, and
protectible designs, and all applications and registrations
therefor, and all extensions and renewals thereof, (iv) all
trade secrets and confidential business information (including
research and development, know-how, formulae, compositions,
processes, techniques, methodologies, technical information,
designs, industrial models, manufacturing, engineering and
technical drawings, specifications, research records, records of
inventions, test information, customer and supplier lists, customer
data, pricing and cost information, and business and marketing
plans and proposals), (v) all Software, and all electronic
data, databases and data collections, and (vi) all rights to
use all of the foregoing and all other rights in, to, and under the
foregoing.
“ Joint Development
Agreement ” has the meaning set forth in the Recitals of
this Agreement.
“ Licensed Intellectual
Property ” means (i) the Intellectual Property of
Licensor and its Affiliates as of the Closing used or held for use
in connection with the Business or otherwise relating to the ADA-ES
Contributed Assets and/or the Underlying Assets, including
(x) the Intellectual Property listed on Schedule A
attached hereto, and (y) After-Filed Patents, and
(ii) the New IP; provided , however , that
“Licensed Intellectual Property” shall not include any
(A) Transferred Intellectual Property, or (B) any
Trademarks.
“ Licensee ” has
the meaning set forth in the Preamble of this Agreement.
“ Licensor ” has
the meaning set forth in the Preamble of this Agreement.
“ New IP ” means
the Intellectual Property of Licensor and its Affiliates acquired
or developed during the Future Licensing Period relating primarily
to the Field.
“ Software ”
means computer programs, applications, interfaces, operating
systems, middleware, firmware or embedded software programs or
applications, including source code, object code, including related
documentation, development tools, test suites, files, processes,
scripts, routines used to process data, web sites (including
related computer code and content), improvements, modifications,
enhancements, versions and releases relating thereto, and all
documentation related to any of the foregoing, irrespective of the
media on which it is recorded.
“ Transferred Intellectual
Property ” means the Intellectual Property that,
immediately prior to the Closing, was owned by Licensor or any of
its Affiliates and that is primarily used or held for use in
connection with the Business or otherwise primarily relating to the
ADA-ES Contributed Assets and/or the Underlying Assets, including
the Intellectual Property listed in Part A of
Section 4.6(a) of the Disclosure Schedule to the Joint
Development Agreement.
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Section 1.2
Interpretation . When a reference is made in this Agreement
to a Section or Article, such reference shall be to a Section or
Article of this Agreement unless otherwise indicated. Whenever the
words “include,” “includes” or
“including” are used in this Agreement, they shall be
deemed to be followed by the words “without
limitation.” The words “hereof,”
“herein,” “hereto” and
“hereunder” and words of similar import when used in
this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement. The definitions
contained in this Agreement are applicable to the singular as well
as the plural forms of such terms and to the masculine as well as
to the feminine and neutral genders of such term. Any agreement,
instrument or statute defined or referred to herein shall mean such
agreement, instrument or statute as from time to time amended,
modified or supplemented. References to a Person are also to its
permitted successors and assigns and, in the case of an individual,
to his heirs and estate, as applicable.
ARTICLE II
LICENSE
Section 2.1 License of
Licensed Intellectual Property . Effective as of the Closing,
on the terms and conditions set forth herein, Licensor hereby
grants to Licensee and its Affiliates a perpetual, worldwide,
royalty-free, fully paid up, exclusive license to use the Licensed
Intellectual Property (other than the New IP) in the Field.
Effective as of the date of acquisition or development of any New
IP, on the terms and conditions set forth herein, Licensor hereby
grants to Licensee and its Affiliates a perpetual, worldwide,
royalty-free, fully paid up, exclusive license to use such New IP
in connection with the Field. The foregoing licenses include the
right (a) to make, have made, use, import, export, distribute,
offer to sell and sell products under the Licensed Intellectual
Property, and (b) to publish, display, reproduce, copy,
modify, improve, create derivative works of, enhance, and otherwise
exploit such Licensed Intellectual Property. The foregoing licenses
shall be sublicensable solely as is reasonably necessary in
connection with the receipt of goods and services by Licensee and
its Affiliates but is not sublicensable pursuant to this
Section 2.1 for use by any third Person for such third
Person’s own benefit. Licensor shall promptly advise Licensee
in writing of any acquisition or development of any New IP. For the
avoidance of doubt, nothing in this Agreement shall prohibit
Licensor from using the Licensed Intellectual Property for
applications or other uses that are outside the Field.
Section 2.2 Requests for
Licensed Intellectual Property . To the extent that Licensee
becomes aware that its personnel is not in possession of
(a) copies of all documentation (either in electronic or hard
copy) that is in Licensor’s possession or control as of the
Closing Date and that constitutes Licensed Intellectual Property
and/or is reasonably necessary for the use of the Licensed
Intellectual Property, and/or (b) tangible embodiments of the
Licensed Intellectual Property (including copies of all Software
included in the Licensed Intellectual Property) that is in
Licensor’s possession or control as of the Closing Date,
promptly following Licensee’s request, Licensor will
confidentially provide to Licensee copies (at Licensee’s
option, either in electronic (to the extent available) or hard
copy) of such documentation and/or tangible embodiments as such
documentation and/or tangible embodiments existed as of the Closing
Date. Notwithstanding anything to the contrary in this
Section 2.2 , with respect to Licensed Intellectual
Property that is New IP, promptly after such coming into
Licensor’s possession or control, Licensor shall
confidentially provide to Licensee (at Licensee’s
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option, either in electronic (to the extent
available) or hard copy) (a) copies of all documentation that
is in Licensor’s possession or control and constitutes such
Licensed Intellectual Property and/or is reasonably necessary for
the use of such Licensed Intellectual Property, and/or
(b) tangible embodiments of such Licensed Intellectual
Property (including copies of all Software included in such
Licensed Intellectual Property) that is in Licensor’s
possession or control. If Licensee has a reasonable basis to
believe that Licensor has failed to either (i) provide to
Licensee copies of such documentation and/or tangible embodiments
or (ii) advise Licensee of any New IP in accordance with
Section 2.1 , then, upon reasonable notice to Licensor
and during normal business hours, Licensee shall have the right to
confidentially audit and inspect the books and records relating to
the acquisition and development of such Intellectual Property (and
make confidential copies thereof); provided , however
, that if any Member of Licensee is a Competitor, no such right of
audit shall apply.
Section 2.3 Right to License
Additional Intellectual Property .
(a) If, during the Future Licensing
Period, Licensor or any of its Affiliates (other than Excluded
Affiliates) acquires or develops any Intellectual Property relating
to the Field, including, without limitation, a carbon application
for control of pollutants developed by Licensor for control of
pollutants other than mercury (but in each case other than New IP)
(hereinafter, the “ Additional IP ”), Licensor
shall promptly advise Licensee in writing thereof and shall provide
such technical information related thereto on a confidential basis
to allow Licensee to evaluate such Intellectual Property. If
Licensee has a reasonable basis to believe that Licensor has failed
to advise Licensee of any such Intellectual Property acquired or
developed during the Future Licensing Period, Licensee shall have
the same audit rights with respect to such Intellectual Property as
it has with respect to New IP pursuant to the last sentence of
Section 2.2.
(b) With respect to each item of
Additional IP, Licensor shall (and shall cause its applicable
Affiliate(s) (other than Excluded Affiliates) to) offer to Licensee
and its Subsidiaries a perpetual, worldwide, exclusive license to
use such Additional IP in connection with the Field, on such
additional terms as Licensor or such Affiliate is willing to
accept. If Licensor’s and such Affiliates’ rights in
such Additional IP are less than those described in the immediately
preceding sentence, then Licensor and such Affiliates shall only be
obligated to offer the maximum rights that Licensor and such
Affiliates have with respect to such Additional IP, provided that
such limitations were not imposed through any breach of this
Agreement. Licensee shall advise Licensor within thirty
(30) days after the later of (i) receiving written notice
of such new Intellectual Property (or, in the case of any such
Intellectual Property disclosed through audit, thirty
(30) days after disclosure of such new Intellectual Property
in the audit) and (ii) receiving an offer to license such new
Intellectual Property (including the material terms of such
licens
