LICENSE AGREEMENT
This Patent
License Agreement (“the Agreement”) is effective this
28 th
day of September, 2009
between:
Altman
Enterprises, LLC (“Owner”), having an address at P.O.
Box 1332, Hermitage, PA 16148; and
Inverso Corp.
(“Licensee”), a Delaware corporation, having an office
at P.O. Box 25, Jackson Center, PA 16133.
The parties
intending to be legally bound agree as follows.
ARTICLE 1
— GRANTS OF LICENSES
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Grant. Subject to the terms of this
Agreement, Owner grants to Licensee exclusive, nontransferable
licenses for:
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the
Applications and any non-provisionals, continuations,
continuations-in-part, divisions, reissues, re-examinations or
extensions thereof, and in and to any and all patents of the United
States and foreign countries that may be issued and claim priority
to the Applications; and
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Duration. Subject to the terms of
this Agreement, all licenses granted herein:
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a)
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under any
Patents or Applications shall continue for the entire unexpired
term of such patent or for as much of such term as the Owner has
the right to grant; and
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under any
Trademark shall continue in perpetuity or for as much of such term
as the Owner has the right to grant, except that the license shall
revert to Owner if Licensee ceases commercial use of the Trademark
for a continuous period of at least one year.
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1.3 Scope. The
licenses granted herein are licenses to:
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make, have
made, use, lease, sell and import Licensed Products for the legal
purposes of researching, developing, manufacturing, assembling,
distributing, and selling the Licensed Products;
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make, have
made, use and import machines, tools, materials and other
instrumentalities, insofar as such machines, tools, materials and
other instrumentalities are involved in or incidental to the
research, development, manufacture, testing or repair of Licensed
Products which are or have been made, used, leased, owned, sold or
imported by the Licensee; and
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convey to any
customer of the Licensee, with respect to any Licensed Product
which is sold or leased to such customer, rights to use and resell
such Licensed Product as sold or leased by Licensee (whether or not
as part of a larger combination); provided, however, that no rights
may be conveyed to customers with respect to any Invention which is
directed to (i) a combination of such Licensed Product (as sold or
leased) with any other product, (ii) a method or process which is
other than the inherent use of such Licensed Product itself (as
sold or leased), or (iii) a method or process involving the use of
a Licensed Product to manufacture (including associated testing)
any other product.
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Licenses
granted herein are solely for products in the form sold by the
Licensee and are not to be construed either (i) as consent by the
Owner to any act which may be performed by the Licensee, except to
the extent impacted by a patent licensed herein to the Licensee, or
(ii) to include licenses to contributorily infringe or induce
infringement under U.S. law or a foreign equivalent
thereof.
The grant of
each license hereunder includes the right to grant sublicenses to a
Related Company for so long as it remains a Related
Company. Any such sublicense may be made effective
retroactively, but not prior to the effective date hereof, nor
prior to the sublicensee's becoming a Related Company.
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Ability to
Provide Licenses. Owner warrants that, upon execution
hereof by him and as of the effective date hereof, there are no
known commitments or restrictions which limit the licenses and
rights which are purported to be granted hereunder by
him.
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Publicity. Nothing in this Agreement
shall be construed as conferring upon either party or its Related
Companies any right to include in advertising, packaging or other
commercial activities related to a Licensed Product, any reference
to the other party (or any of its Related Companies), its trade
names, trademarks or service marks in a manner which would be
likely to cause confusion or to indicate that such Licensed Product
is in any way certified by the other party hereto or its Related
Companies.
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Good
Faith. Licensee understands that this Agreement is not
predicated on any specific grant of patent or trademark
registration. Owner shall have no liability for a
failure to pursue or obtain any specific patent or
trademark.
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ARTICLE 2
— ROYALTY AND PAYMENTS
2.1 Royalty
Calculation. Licensee shall pay a royalty to
Owner.
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Within five (5)
business days of the Effective Date: Licensee shall
issue to Owner 1,234,074 shares of its Series A Convertible
Preferred Stock on the Effective Date.
Licensee’s duly executed Certificate of Designation of the
Rights, Preferences, Privileges and Restrictions of the Series A
Convertible Preferred Stock of Inverso Corp. is attached hereto as
Exhibit A.
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At the end of every calendar quarter,
Licensee shall pay Owner a royalty of 5% of Fair Market Value
of:
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Licensed
Product that is sold, leased or put into use by the Licensee or any
of its Related Companies in the preceding calendar quarter;
and
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any service
performed by Licensee or any of its Related Companies that directly
or indirectly uses Licensed Product.
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This License
does not include a minimum annual royalty payable by Licensee to
Owner.
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2.2 Accrual.
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Obligations to
pay royalties shall survive termination of this License and the
expiration of any Patent. The accrual of royalties shall
cease upon termination of this License or the expiration of the
subject Intellectual Property.
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When a company
ceases to be a Related Company of the Licensee, royalties which
have accrued with respect to any products of such company, but
which have not been paid, shall become payable with the Licensee's
next scheduled royalty payment.
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Notwithstanding
any other provisions, royalty shall accrue and be payable only to
the extent that enforcement of the Licensee's obligation to pay
such royalty would not be prohibited by applicable law.
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2.3 Records
and Adjustments.
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The Licensee
shall keep full, clear and accurate records with respect to all
Licensed Products and shall furnish any information which Owner may
reasonably request from time to time to enable Owner to ascertain
the proper royalty due on account of (a) Licensed Products sold,
leased and put into use by the Licensee or any of its Related
Companies, and (b) services performed by Licensee or any of its
Related Companies that directly or indirectly uses Licensed
Product. Owner shall have the right through its
accredited auditors to make an examination, during normal business
hours, of all records and accounts bearing upon the amount of
royalty payable to him. Prompt adjustment shall be made
to compensate for any errors or omissions disclosed by such
examination.
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Independent of
any such examination, Owner will credit to the Licensee the amount
of any overpayment of royalties made in error which is identified
and fully explained in a written notice to Owner delivered within
twelve (12) months after the due date of the payment which included
such alleged overpayment, provided that Owner is able to verify, to
its own satisfaction, the existence and extent of the
overpayment.
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No refund,
credit or other adjustment of royalty payments shall be made by
Owner except as provided in this Section 2.3. Rights
conferred by this Section 2.3 shall not be affected by any
statement appearing on any check or other document, except to the
extent that any such right is expressly waived or surrendered by a
party having such right and signing such statement.
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2.4 Reports
and Payments.
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Within thirty
(30) days after the end of each quarterly period ending on March
31 st
, June 30 th ,
September 30 th ,
or December 31 st ,
commencing with the quarterly period during which this Agreement
becomes effective, the Licensee shall furnish to Owner at the
address specified by Section 7.5 a statement certified by a
responsible official of the Licensee showing in a manner acceptable
to Owner:
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all Licensed
Products which were sold, leased or put into use during such
quarterly period by the Licensee or any of its Related Companies,
the gross sales received for the Licensed Products, and the Fair
Market Values of such Licensed Products;
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all services
performed by Licensee or any of its Related Companies that directly
or indirectly used Licensed Product, the gross sales received by
the services, and the Fair Market Value of such
services;
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the amount of
royalty payable thereon, and
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if no Licensed
Product has been so sold, leased or put into use or if no services
have been performed, the statement shall show that fact.
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Within such
thirty (30) days the Licensee shall pay in United States dollars to
Owner at the address specified by Section 7.5 the royalties payable
in accordance with such statement. Any conversion to United States
dollars shall be at the prevailing rate for bank cable transfers as
quoted for the last day of such quarterly period by leading United
States banks in New York City dealing in the foreign exchange
market.
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Overdue
payments hereunder shall be subject to a late payment charge
calculated at an annual rate of three percent (3%) over the prime
rate or successive prime rates (as posted in New York City) during
delinquency. If the amount of such charge exceeds the maximum
permitted by law, such charge shall be reduced to such
maximum.
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Intellectual
Property Rights. Owner shall have no obligation to
license or assign any future patents, trademarks, or trade secrets
except as specifically and explicitly granted by this
Agreement.
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Return of
Royalty. Owner shall have no duty to return to Licensee
any prior payments, royalties, stock, stock options, or
reimbursements unless such payments were made in
error. Error means a mutual mistake of fact, and shall
not include the failure to obtain a patent or trademark,
cancellation of a Patent or Trademark for any reason, or a
successful challenge to the Intellectual Property by a third
party.
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ARTICLE 3
– INTELLECTUAL PROPERTY PROSECUTION AND COSTS
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Costs. Licensee shall reimburse Owner
for all IP Costs incurred on behalf of
Licensee. Licensee shall also be liable for pre-paid IP
Costs incurred prior to the Effective Date of this Agreement,
including the costs of provisional and non-provisional applications
that are filed to preserve Intellectual
Property. Reimbursement for pre-paid IP Costs shall
occur within 12 months of the Effective Date.
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Extension of
Application. By written notice to Owner and at least
ninety (90) days before the non-extendable due date for the filing
of a national phase application of an Application, Licensee shall
elect those countries or authorities in which it desires to file a
patent application based on the
Application. Intellectual Property rights in an
unelected country shall revert to Owner.
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Notice to
Licensee. Before payment of any IP Cost, Owner shall
notify Licensee for a time period being the lesser of (i) at least
sixty (60) days before the IP Cost is due or (ii) as soon as is
practicable after receiving knowledge of the IP
Cost. The notice will identify (i) the Application,
Patent, or Trademark, (ii) the country, (iii) the reason for the IP
Cost, and (iv) the Due Date for payment. Licensee shall
then affirm or deny payment. Affirmation of payment must
be received by Owner within fourteen (14) days of the mailing date
of the notice or the Licensee shall be deemed to have denied
payment.
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If Licensee
affirms a payment, Licensee shall reimburse Owner for all IP Costs
arising from the payment and shall then retain its license for the
Application, Patent or Trademark in that country.
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If Licensee
denies payment, License shall have no obligation to pay IP Costs
associated with the Application, Patent or Trademark in that
country, but the license and all associated rights for that
Application, Patent or Trademark shall revert to Owner.
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Reimbursement
by Licensee. Licensee shall prepay Owner for any
affirmed IP Cost before payment is to be made by
Owner. Owner shall have no duty to pay an IP Cost for
which Owner does not receive prepayment. If Licensee
does not pay Owner by the Due Date, the Application, Patent or
Trademark shall revert to Owner as if Licensee had denied payment
under section 3.3(b).
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Reversion of
License. If a reversion occurs under this Article, the
license in that country in which reversion has occurred will be
terminated, and Licensee shall have no further right in the
Application, Patent or Trademark for that country. The
right shall revert to Owner who will then have the right to pursue
protection for the reverted Application, Patent or
Trademark. Owner has no further duty to Licensee for a
reverted Application, Patent or Trademark.
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ARTICLE 4
– TRADEMARK
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Use of
Trademark. Licensee shall prominently use the Trademark
on Licensed Products.
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Owner
Approval. In order to protect and preserve Owner’s
rights in the Trademarks, Licensee understands, acknowledges, and
agrees that (i) prior to the first date of Licensee's use of the
Trademarks in connection with Licensed Product, Licensee shall
obtain Owner’s approval of all aspects of such use; and (ii)
once Licensee's use of the Trademarks in connection with the
Licensed Products is initially approved by Owner, any subsequent
alteration, modification, or change in such use must be reviewed
and approved by Owner prior to implementation of such alteration,
modification, or change.
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Trademark
Format. Owner retains the right to specify, from time to
time, the format in which Licensee shall use and display the
Trademarks, and Licensee shall only use or display the Trademarks
in a format approved by Owner.
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Proper Notice
and Acknowledgment. Every use of the Trademarks by
Licensee shall incorporate in an appropriate manner the legal
status of the Trademarks, that is, a superscript “TM”
for unregistered marks and an "R" enclosed by a circle or the
phrase "Reg. U.S. Pat. & Tm Off." for registered
marks.
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Impairment of
Owner's Rights. Licensee shall not at any time, whether
during or after the term of this Agreement, do or cause to be done
any act or thing challenging, contesting, impairing, invalidating,
or tending to impair or invalidate any of Owner's rights in the
Trademarks or any registrations derived from such
rights.
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Owner's Rights
and Remedies. Licensee acknowledges and agrees that
Owner has, shall retain, and may exercise, both during the term of
this Agreement and thereafter, all rights and remedies available to
Owner, whether derived from this Agreement, from statute, or
otherwise, as a result of or in connection with Licensee's breach
of this Agreement, misuse of the Trademarks, or any other use of
the Trademarks by Licensee which is not expressly permitted by this
Agreement.
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Owner’s
Right to Inspect. Owner shall have the right to inspect,
upon reasonable notice, the use of the Trademarks by the Licensee
and the quality and type of goods on which Licensee uses the
Trademarks. Owner may, at its sole discretion, require
Licensee to remove the mark from the goods.
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ARTICLE 5
– INDEMNIFICATION AND VALIDITY
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5.1
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Validity. Licensee agrees that the
Patents are valid and enforceable.
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Enforceability. Licensee and its
Related Companies shall take no action, directly or indirectly,
that challenges, contests, impairs, invalidates, or
tends to impair or invalidate any of Owner's rights
in the Patents.
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Indemnification. Licensee shall
indemnify and hold harmless Owner, its managers, officers,
directors, members, employees, agents, successors and assigns to
the fullest extent permitted by law in any Lawsuit by Licensee,
Related Company, or a third party. Indemnification shall
include any and all Litigation Costs.
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At the request
of Owner, Licensee shall procure a comprehensive business insurance
policy for at least $5 million naming Owner as the
insured. Coverage shall protect at least against acts of
Licensee’s employees; injuries to members of the public
resulting from faulty products or services; contractual agreements
under which liability of others is assumed; and comprehensive
liability. Licensee understands that indemnification
shall not be limited to the amount of insurance.
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Payment of
Litigation Costs. Owner may submit Litigation Costs to
Licensee when paid by Owner and Licensee shall pay Owner the
Litigation Costs within 30 days of receipt. In the event
Litigation Costs include a court ordered payment, Owner can submit
the court order to Licensee and Licensee shall pay the court
ordered payment to Owner.
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ARTICLE 6
— TERMINATION AND LEGAL FEES
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Breach. In the event of a breach of
this Agreement by either party, the other party may, in addition to
any other remedies that it may have, at any time terminate all
licenses and rights granted by it hereunder by not less than one
(1) month’s written notice specifying such breach, unless
within the period of such notice all breaches specified therein
shall have been remedied. The failure of a party to
notify a breaching party shall not be considered a
waiver.
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Insolvency or
Dissolution. Owner, at its sole discretion, may
terminate this Agreement if:
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Licensee
becomes insolvent, declares bankruptcy, or fails to make any
payment required by this Agreement within thirty (30) days of its
due date; or
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Licensee
dissolves or attempts to dissolve either voluntarily or
involuntarily.
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Devaluation of
Stock. Owner may terminate this Agreement if Licensee
devalues or attempts to devalue the stock or any stock options
(collectively, the “Stock”) derived from or issued
under Article 2. Devalue means (a) cancelling the Stock,
or (b) impairing the right to sell or leverage the
Stock.
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Effect of
Termination. Upon any termination of this
Agreement:
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all rights
shall immediately revert to Owner free of any lien, security
interest, or other encumbrance;
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Licensee may,
for up to 60 days continue to sell and offer for sale its remaining
inventory of Licensed Products, and on the 61
st day destroy or offer for sale to Owner such
remaining inventory;
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Licensee shall
pay royalties per Article 2, and shall pay all royalties within 90
days of the termination date;
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Licensee shall
provide Owner with all copies of research data, records, notes,
memorandum, and reports that were obtained from research or
development efforts arising from the Applications, Patents,
Intellectual Property, or Licensed Product.
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Litigation
Costs. In the event of a dispute between Owner and
Licensee, Licensee shall pay all costs arising from the
dispute. Dispute costs can include, but are not limited
to, attorneys’ fees, travel expenses, court costs, expert
witness fees, and any settlement.
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Public
Company. Owner has the option of terminating this
Agreement if Licensee’s stock is not publically traded by
April 1, 2011. This termination option shall survive for
so long as this condition persists.
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Duty of
Diligence. Licensee shall exercise reasonable diligence
to affect the introduction of Licensed Products into the commercial
market. Licensee further agrees to ensure proper, safe,
fair, lawful and reasonable development and exploitation of the
commercial market for Licensed Products. Failure of
Licensee to materially comply with the provisions of this paragraph
shall be considered a material breach of this Agreement.
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ARTICLE 7
— MISCELLANEOUS PROVISIONS
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Disclaimer. Neither party makes any
representations, extends any warranties of any kind, assumes any
responsibility or obligations whatever, or confers any right by
implication, estoppel or otherwise, other than the licenses, rights
and warranties herein expressly granted. Owner makes no
warranties whether express, implied or statutory, written or
oral.
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Owner expressly DISCLAIMS ANY WARRANTY OF
MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR
PURPOSE. Owner also disclaims any warranty arising
from (a) a claim against a Application, Patent or Trademark, or (b)
a course of dealing or trade usage.
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7.2
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Representations, Warranties, and Agreements by
Licensee.
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Licensee is a
corporation duly organized, validity existing and in good standing
under the laws of Delaware, with full power and authority to own,
lease, use, and operate its properties and to carry on its business
as and where now owned, leased, used, operated and
conducted. Licensee has all requisite corporate power
and authority to enter into and perform this Agreement and to
consummate and effect the transactions contemplated by this
Agreement.
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All consents,
approvals, orders, or authorizations of, or registrations,
qualifications, designations, declarations, or filings with, any
governmental authority required on the part of Licensee in
connection with the valid execution and delivery of this Agreement,
the offer, sale or issuance of the stock to Owner or the
consummation of any other transactions contemplated hereby shall
have been obtained, except for notices required or permitted to be
filed with certain state and federal securities commissions, which
notices shall be filed within thirty (30) days of the effective
date of this Agreement.
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The shares of
Licensee being issued to Owner pursuant to this Agreement will be
validly and legally issued and not subject to any security
interests, liens, pledges,
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