LICENSE AGREEMENT
LICENSE AGREEMENT
("the Agreement"), dated December ___, 2006, by
and
among Dr. David P. Summers, an individual
residing at
3158 Canterbury Ln.,
Montgomery, TX 77354
("Summers"),
T.W. Owen, an individual residing at
10635
Lessona St.,
Las Vegas, NV 89141 ("Owen," and together with Summers, the
"Licensor"), and Datastand Technologies, Inc., an Indiana corporation
having an
office at 8333 Weston Road, Suite 106, Woodbridge,
Ontario L4L 8E2 (the
"Licensee").
RECITALS:
WHEREAS, Licensor is the inventor of certain technologies relating
to the
use of fungi, plants, or animals for the production of anti-inflammatory and
analgesic products
used to treat and cure
inflammatory diseases,
and is the
owner of the entire right, title and interest in and to certain Patent
Rights
(defined below) relating to such technologies;
WHEREAS, Licensor desires
to have the
Patent Rights developed and
commercialized and is willing to grant a license thereunder;
and
WHEREAS, Licensee desires
to obtain a license under the Patent Rights
upon the terms and conditions hereinafter set forth.
NOW
THEREFORE,
in consideration of the mutual
covenants and agreements
herein, and other good and valuable consideration, the adequacy,
sufficiency and
receipt of which are hereby acknowledged, the parties hereto agree
as follows:
ARTICLE I
Definitions
1.1
Definitions.
As used in this Agreement, the
following terms shall
have the following meanings:
(a)
"Improvement"
means any improvement, addition, or
modification of
an invention claimed in the Patent Rights and shall include,
without limitation,
any patentable invention that is (i) not included in the Patent Rights and
(ii)
is dominated by one or more Valid Claims of the Patent Rights.
(b)
"Licensed
Product" means any product or part thereof, that: (i)
absent the license granted hereunder, would infringe one or more
Valid Claims of
the Patent Rights; or (ii) is manufactured by using a Licensed
Process or that,
when used, practices a Licensed Process.
(c)
"Licensed
Process" means any process that, absent the license
granted hereunder, would infringe one or more Valid Claims of the
Patent Rights
or which uses a Licensed Product.
1
<PAGE>
(d)
"Patent Rights"
means:
(i) the
United States provisional patent applications listed on
Exhibit A attached hereto;
(ii) any
patent applications resulting from the provisional
applications
listed on
Exhibit
A, and any divisionals, continuations,
continuation-in-part applications, and continued prosecution applications
(and
their relevant international equivalents) of the provisional patent
applications
listed on Exhibit A and of such patent applications
that result from the
provisional applications listed on Exhibit A, and the resulting
patents;
(iii) any patents
resulting from reissues, re-examinations, or
extensions (and
their relevant international equivalents) of the patents
described in clauses (i) and (ii) of this subsection 1.1(d);
and
(iv)
international
(non-United States)
patent applications
and
provisional
applications filed
after the date hereof and the relevant
international
equivalents to
divisionals,
continuations, continuation-in-part
applications and continued prosecution applications of the patent applications
to the extent the claims are directed to subject matter
specifically
described
in the patents or patent applications referred to in clauses (i),
(ii) and (iii)
of this subsection 1.1(d), and the resulting patents.
(e)
"Term"
shall mean the term of
this Agreement, which shall commence
on
the date hereof and shall remain in effect until the expiration or
abandonment
of the last remaining Valid Claim of
any issued patents and filed patent
applications within
the Patent Rights,
unless earlier terminated in accordance
with the provisions of
this Agreement,
in which case the Term
shall terminate
upon the effective date of such termination.
(f)
"Territory"
means the following:
North America
to include Mexico
and Canada (the "Territory").
(g)
"Valid Claim"
means either (i) a claim of an issued patent within
the Patent Rights that has not been held invalid by an
administrative agency
or
court of competent jurisdiction in any unappealed or
unappealable decision or
(ii) a claim of a pending application that has not been abandoned or finally
rejected without the possibility of appeal or refilling.
The invalidity of a
particular claim in one or more countries shall not invalidate such
claim in the
remaining countries of the Territory.
ARTICLE II
License Grant
2.1
License
Grant. Subject to the terms and conditions of this
Agreement, Licensor
hereby grants to
Licensee, and Licensee hereby accepts, an
exclusive, irrevocable, perpetual license ("License") in the Territory to
develop and have developed,
2
<PAGE>
to make and have made, to use and have used, to sell and have sold,
and to lease
and have leased Licensed Products and Licensed Processes.
2.2
Exclusivity.
Licensor
agrees that it shall
not retain any rights
to, and shall not directly or indirectly grant any other licenses to,
develop,
make, use, sell, and
lease Licensed Products in the Territory or to perform
Licensed Processes in the Territory during the Term.
2.3
Exclusive Option
to Improvements.
(a)
Licensor hereby
grants to Licensee an exclusive option
to
add Improvements to the Patent Rights. Licensee may exercise its option to add
such Improvement
to the Patent Rights by providing Licensor with written
notification of Licensee's desire to so add the Improvement to the Patent
Rights. Upon
Licensee's exercise of such right, such Improvement shall be
added
to the Patent Rights and Exhibit A hereto
shall be deemed to have been amended
to add the invention
disclosure (and any
related patent applications) covering
such Improvement.
Licensor shall not offer a license to such Improvement to any
third party.
(b) At
Licensee's option,
Licensor shall assign to Licensee,
without further consideration, its entire right, title and interest
in and to
each and every such Improvement.
2.4
Sublicenses.
Licensee shall have
the right to grant sublicenses of
its rights under Section 2.1.
2.5 Right of First Refusal. Licensee shall have the
Right of First
Refusal in
the sale of any additional Territorial
Licenses for the Patent
Rights, together with sixty (60) days to consummate such
transaction.
ARTICLE III
CONSIDERATION
3.1
Consideration.
In consideration of the License, Licensee shall
issue to Licensor an aggregate of two million (2,000,000)
shares of its common
stock (the "Consideration Shares") as follows:
Upon execution of this
Agreement, Licensee shall issue to Licensor two million
(2,000,000) shares of the common stock of Licensee, which is hereby
acknowledged
and agreed to
constitute
consideration
for the grant of the License in the
Territory;
The Consideration Shares shall be allocated among each Licensor in the manner
specified on Exhibit B attached hereto.
3
<PAGE>
ARTICLE IV
Representations and Warranties
4.1
Licensor's
Representations and Warranties. Each Licensor, jointly
and severally, hereby warrants and represents to Licensee that:
(a)
Authority.
This Agreement
constitutes the legal, valid and binding
obligation of each Licensor, enforceable against each of them in
accordance with
its terms.
Upon the execution and
delivery by each Licensor of this Agreement,
this Agreement will
constitute the legal,
valid and binding obligation of each
Licensor, enforceable against each of them in accordance with its terms.
Each
Licensor has the absolute and unrestricted right, power and
authority to execute
and deliver this Agreement and to perform its obligations under this
Agreement,
and such action has been duly authorized by
all necessary action of each
Licensor.
(b)
Infringement;
No Conflict; Litigation. No patent or other
intellectual property
right of any
third party is infringed or has been
challenged or threatened in any way by the Patent Rights or the
technologies
relating to the Patent Rights. To Licensor's knowledge, there is no patent or
patent application of any third party that may potentially infringe
or otherwise
interfere with the Patent Rights. Neither the execution and
delivery of this
Agreement nor
the consummation or performance of any of the transactions
contemplated hereunder will, directly or indirectly (with or
without notice
or
lapse of time), breach or give any governmental
authority or other person the
right to challenge this Agreement or any of the transactions contemplated
hereunder.
Licensor has
not granted any other
licenses with respect
to the
Patent Rights.
Licensor is not aware
of any existing or
threatened litigation
concerning the Patent Rights.
(c)
No Consent
Required. Licensor
is not required to give any
notice
to or obtain any consent from any person in connection with the execution and
delivery of
this Agreement or the consummation or
performance of any of
the
transactions contemplated hereunder.
(d)
Inventors;
Ownership.
Licensor
is the sole inventor of the
technologies relating
to the Patent Rights.
Licensor is the sole and exclusive
owner of the entire
right, title and interest in and to the Patent Rights, free
and clear of all liens
or other encumbrances. Licensor has full legal right,
authority to grant the exclusive License to Licensee as set forth
herein.
(f)
Securities Matters.
(i)
Licensor acknowledges its understanding that the issuance of
the Consideration Shares hereunder is intended to be exempt from registration
under the Securities Act of 1933, as amended (the "Securities
Act"). In
furtherance thereof, each of Licensor hereby jointly and severally represents
and warrants to the Licensee that it is an "accredited investor" as
that term is
defined in Rule 501 of
the General Rules and Regulations under the Securities
Act. Licensor is
acquiring the Consideration Shares for
4
<PAGE>
its own account as principal, not as a nominee or agent, for
investment purposes
only, and not with a
view to, or for, resale, distribution or fractionalization
thereof in whole or
in part and no other person has a direct or indirect
beneficial interest in such shares or any portion thereof.
Each
Licensor has
the financial
ability to bear the economic risk of its investment. Each
Licensor has such knowledge and experience in financial and
business matters
as
to be capable of
evaluating the merits and risks of the prospective investment
in the shares being
issued to it hereunder. Each Licensor has been provided
an
opportunity for
a reasonable period of
time prior to the date hereof to obtain
additional information
concerning the issuance of the shares, Licensee, and all
other information to the extent Licensee possesses such information or can
acquire it without unreasonable effort or expense.
(ii) Licensor
understands that the Consideration Shares will not
be registered
under the Securities Act or the securities laws of any
state
thereof, nor is such registration contemplated. Licensor understands and
agrees
further that
such shares must be
held and may not be
transferred
until and
unless the shares are
registered
under the Securities Act and the
securities
laws of any other jurisdiction or an
exemption from
registration
under the
Securities Act
and any applicable
laws is available. Licensor understands that
legends stating that
the shares
have not been
registered under the Securities
Act and the securities laws of any other
jurisdiction
and setting out or
referring to the
restrictions on
the transferability
and resale of the shares
will be placed on all documents evidencing the shares.
(g)
Full Disclosure.
No representation or
warranty of Licensor in this
Agreement omits
to state a material fact necessary
to make the statements
herein, in light of the circumstances in which they were made, not
misleading.
There is no fact known to Licensor that has specific application to the Patent
Rights and that materially adversely affects or, as far
as can be reasonably
foreseen, materially threatens the Patent Rights that has not been
set forth in
this Agreement.
4.2
Licensee's
Representations and Warranties.
(a)
Authority.
This Agreement
constitutes the legal, valid and binding
obligation of
Licensee, enforceable against Licensee in accordance with
its
terms. Upon
the execution and
delivery by Licensee
of this Agreement, this
Agreement will
constitute the legal,
valid and binding obligation of Licensee,
enforceable against Licensee in accordance with its terms. Licensee has the
absolute and unrestricted right, power and authority to execute and
deliver this
Agreement and to perform its obligations under this Agreement,
and such action
has been duly authorized by all necessary action of Licensee.
(b)
Issuance
of Consideration
Shares. The
Consideration Shares,
when
issued in accordance with the terms hereof and on the basis of the
representations and warranties of set forth herein and paid for as herein
provided, shall be duly and validly issued, fully paid, and
non-assessable.
5
<PAGE>
ARTICLE V
Patent Prosecution
5.1
Responsibility
for Patent Rights. Licensor shall prepare, file,
prosecute, and maintain all of the Patent Rights. Licensor and its appointed
patent attorneys
shall use reasonable efforts to copy
Licensee on all
patent
correspondence as follows: (a) documents received from any patent
office shall
be provided to Licensee promptly after receipt; (b) any document to be
filed in
any patent office shall be provided in draft form to Licensee
sufficiently prior
to such document's filing to allow for review and comment by Licensee; an