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Watiare International
Inc.
L I C E N S E A G R
E E M E N T
This LICENSE AGREEMENT made as of the 25
th day of January 2007 between WATAIRE INTERNATIONAL,
INC., a corporation incorporated under the laws of the State of
Washington, United States of America, with its corporate office
located at Suite 300, Warner Center, 21550 Oxnard Street, Woodland
Hills, California, USA 91367 (hereinafter referred to
as the "Grantor")
and
AIRBORN WATER COMPANY LTD a limited corporation under the laws
of the United Kingdom, with its corporate office located at
39 – 40 Emperor’s Gate, London, United Kingdom
SW7 4HJ (hereinafter referred to as the "Licensee")
WHEREAS:
1. The Grantor is the owner of certain rights to
technological knowledge and equipment with respect to Atmospheric
Water Production Technology as hereinafter defined; and
2. The Licensee intends to purchase equipment from the Grantor
for use in the production of consumer bottled water and beverage
facilities. The Licensee will market and sell its
own brand(s) of consumer bottled water and beverages which may be
produced in full or in part by the Grantors equipment or products,
as well as other manufactures products and or services in the
Territory (s) hereinafter specified and desires a license from the
Grantor under the Technology as hereinafter defined.
In addition, the Licensee plans to market and
distribute the Grantors products in the territory of the United
Kingdom, in which, the Licensee will act as manufactures exclusive
representatives in such territory.
IN CONSIDERATION of the mutual promises and
covenants contained in this License Agreement, and other good and
valuable consideration, the receipt and sufficiency of which is
acknowledged, the parties agree as follows:
1. Definitions
In this License Agreement:
(a) "Products" shall mean the CI-2500 and CI-5000, and any
future commercial grade product to be manufactured by the Grantor
or capable of being manufactured by the Grantor with the
Grantor’s Technology.
(b) "Other Products" shall mean products utilizing other
technology(s) that may be solely, partially, and or integrated with
the technologies owned by the Grantor and or other designed and
manufactured products and or services form other manufactures.
(c) "Technology" includes all use of technical information,
intellectual property, patents, patents that are pending,
procedures, methods, practices, techniques, information, and
production manuals, manufacture, production, inspection and testing
of the Products and Other Products.
(d) "Exclusive Territory" includes that Territory as outlined
and described as follows: United Kingdom
(e) "Non-Exclusive Territory" is based on a Worldwide Territory
except where there may be existing exclusive distributers.
2. Grant of License
(1) The Grantor grants to the Licensee the exclusive license in
the Territory of the United Kingdom and a non-exclusive license
outside the United Kingdom under a 60 day right of first refusal on
Territories outside the United Kingdom, to use the Technology for
the purpose of bottling and selling atmospheric generated water,
known as converting air to water and filtering such water for human
consumption within the Territory.
(2) The Licensee acknowledges that some or all of the Technology
has been disclosed and delivered to the Licensee in confidence
prior to and in contemplation of the execution of this License
Agreement.
(3) The obligation to furnish the Technology shall extend to
Technology existing at the date of this License Agreement and
future developments, improvements and associated technology.
(4) The Grantor warrants that there are no other existing
licenses for a consumer bottled water facility under the Technology
in the Territory other than those licenses to be granted and are
excluded from this License Agreement as they relate to the sale of
equipment, and covenants that no further disclosure to third
parties will be made by it of the Technology in the Territory while
this License Agreement is in force.
(5) The Grantor warrants that the Technology will be sufficient
and suitable for the manufacture of the Products and Other Products
provided that the Licensee at all times conforms strictly with the
Technology.
(6) No further or different rights or licenses are granted or
implied.
3. Term of License Agreement
Subject to the provisions for early termination as set out in
this License Agreement, this License Agreement shall remain in full
force and effect for a period of fourteen years (14) years and
Licensee is hereby granted the option to renew this License
Agreement for an additional ten(10) year term.
4. Improvements
(1) Disclosure: Each party agrees to promptly disclose to the
other any and all technical data and information relating to any
and all developments or improvements of the Products or Other
Products (whether or not patentable) and of the Technology that it
may develop or acquire during the term of this Agreement to the
extent that such disclosure is not restricted or prohibited by law,
by any undertaking given to, or any condition, restriction or
restraint imposed by third parties, or by considerations relating
to the validity of any patent in respect of which application is
about to be made.
(2) Grant Under Improvements: The Grantor shall grant to the
Licensee all improvements and developments through to be furnished
to the Licensee, together with an ancillary grant of the right to
use any associated Technology, provided that in the case of any
such improvement or development the disclosure of which by the
Grantor is subject to any restrictions, legal prohibitions,
undertakings given to or conditions, restrictions or restraints
imposed by third parties or considerations relating to the validity
of any patent in respect of which application is about to be made,
any grant by the Grantor to the Licensee under this provision shall
be limited accordingly.
(3) Feed-back License: Under all developments or improvements of
the Products and Other Products to be furnished by the Licensee to
the Grantor, the following additional terms shall apply:
(a) Inside the Territory, the Licensee shall have the exclusive
license to produce bottled water using the technology and products
of the Grantor, to process, bottle and sell filtered water with
incorporating or constituting such developments or improvements.
Provided that in the case of any such improvement or development
the disclosure of which by the Licensee is subject to any
restriction, legal prohibitions, undertakings given to or
conditions, restrictions or restraints therefore any grant by the
Licensee to the Grantor shall be limited accordingly.
5. Obligations of the Grantor
(1) Technical Assistance: Upon the written request of the
Licensee, the Grantor shall render all Technology, training and
technical assistance necessary to be provided by the Grantor under
this License Agreement at times and places mutually agreed upon and
subject to the availability of the Grantor’s personnel and
facilities. The Grantor does not warrant or agree that any of its
personnel to be furnished or to be made available to the Licensee
under this License Agreement will speak any language other than
English. The Licensee shall obtain all necessary visas, work
permits, residence permits or other permits or approvals necessary
for the entry into and working in the Territory of all technical
personnel who are to be provided by the Grantor under the terms of
this License Agreement. The Licensee shall reimburse the Grantor
for the costs with respect to any employees sent to and maintained
in the Territory under this paragraph. Such reimbursement shall be
made by the Licensee in USD currency and shall be in the amount of
the total of the following:
(a) pre-approved by the Licensee, the reasonable expenses of the
personnel in traveling to, in and around and from Territory;
and
(b) pre-approved by the Licensee, the reasonable and ordinary
living expenses of the personnel while in the Territory.
The Licensee further agrees to reimburse the Grantor for the
aforementioned costs and expenses within thirty (30) days following
receipt of the Grantor’s invoice.
(2) Warrants: Grantor warrants that Grantor will immediately
deliver to Licensee any and all improvements Grantor has developed
on the Products, Other Products and the Technology.
(3) Verification Testing: The Grantor shall perform a
verification test on the Products and Other Products manufactured
in accordance with the Technology. If the verification test
indicates that the manufacture of the Products or Other Products is
in conformity with the technical specifications of the Technology,
the verification test shall be considered to have been successfully
completed. In the event that the verification is not successfully
completed, the Grantor shall analyze the causes and take the
necessary measures to eliminate the defects.
6. Compliance with Local Laws
The Licensee shall ensure that any registration or notification
required by the laws of the Territory shall have been carried out.
The Licensee shall comply with all laws and regulations as may
apply with the Territory, as applicable to this License Agreement
and all transactions and activities contemplated or to be performed
under this License Agreement, and shall procure and maintain all
approvals, licenses, permissions and permits necessary to the
performance of its business and conduct its business in a manner so
as to not bring discredit upon the reputation of the Products,
Other Products or the Grantor. The Licensee shall keep the Grantor
informed of any laws or regulations of the Territory which may
affect the promotion, sales, services or maintenance of the
Products and Other Products in order that the Grantor will not
breach any such laws or regulations through lack of awareness
thereof.
7. Licensee’s
Prohibitions
(1) Advertising: The Licensee shall not advertise the Products
or Other Products outside the Territory except where advertisements
are included in international publications and Internet
publications.
(2) Remain in Territory: The Licensee shall not seek customers,
establish any branch or maintain any office or depot in relation to
the Products and Other Products anywhere outside the Territory
unless agreed to in writing by the Grantor.
8. Consideration
(1) Payments: The Licensee agrees to issue payments to the
Grantor for the purchase of equipment, a minimum amount of One
Million Dollars ($1,000,000) within twelve (12) months of signing
of this agreement under the following terms and conditions:
A)
On or before May 30 th 2007 the Licensee shall order
a minimum of Two Hundred and Fifty Thousand ($250,000.00) worth of
equipment from the Grantor; and
B)
On or before September 30 th 2007 the Licensee shall
place another minimum order of Two Hundred and Fifty Thousand
($250,000.00) worth of equipment from the Grantor; and
C)
On or before January 31 st 2007 the
Licensee shall place another minimum order of Five Hundred Thousand
($500,000.00) worth of equipment from the Grantor.
All said payments are payable in US dollars to
the bank branch and account designated by the Grantor.
(2) Royalties: As consideration for the license granted under
the Technology, the Licensee agrees to pay the Grantor during the
term of this License Agreement an ongoing royalty for the use of
the Product in the production of bottled water an amount equal to
five (5%) percent of the revenues of the Licensee for the sale of
the Product and product produced by such Product less reasonable
expenses associated with the cost of sale. Such Royalties shall be
determined and agreed upon by both parties prior to initiation of
sales. Royalties shall be payable on a quarterly basis. The
Licensee agrees to pay the Grantor a minimum annual Royalty in
order to maintain exclusively for the territory. The minimum annual
Royalty shall be negotiated and agreed upon by the parties on or
before May 30 th 2007.
(3) Payment Period: Within forty-five (45) days of the end
of March, June, September and December, the Licensee shall deliver
to the Grantor a written statement giving the total number of
Products and Other Products manufactured for the quarter being
reported. Concurrently with the making of each such report, the
Licensee shall remit the Royalties then due to the Grantor in
respect of the use of the Technology for the quarter being
reported.
(4) Pricing: Grantor shall provide the
Licensee with Favored Nation Pricing on the equipment purchased by
the Licensee.
(5) Interest on Late Payments: Interest on all late initial
payments, royalties and any other sums due to the Grantor shall be
charged at the rate of one (1%) percent per month until payment is
received.
9. Currency of Payment
(1) All payments required to be made by or on behalf of the
Licensee under this License Agreement shall be paid in lawful
currency of the United States of America.
(2) Restrictive Currency Laws: If any law or regulation is
imposed in the Territory restricting or limiting the right of the
Licensee to make payment to the Grantor as provided in this License
Agreement, the Licensee shall immediately notify the Grantor of any
such restrictions or limitations and shall use its best efforts to
register or qualify this License Agreement under any such law or
regulation in order to allow the Licensee to make full payment to
the Grantor as provided in this License Agreement. The Licensee
agrees to modify any terms or conditions of this License Agreement,
which would not unreasonably interfere with its utilization of the
rights granted under this License Agreement, if such modifications
are necessary in order to allow the Licensee to make full payment
to the Grantor.
10. Grantor’s Warranty and Indemnity re:
Technol
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