This Royalty Agreement involves
Title: IRREVOCABLE LICENSE ROYALTY AGREEMENT
Governing Law: Colorado Date: 11/14/2013
IRREVOCABLE LICENSE & ROYALTY AGREEMENT
This LICENSE & ROYALTY AGREEMENT (“ Agreement ”) is entered into this 21 st day of March, 2012 by Strategic Environmental & Energy Resources, Inc. a Nevada corporation (“SEER”) and Paragon Waste Solutions, LLC, a Colorado limited liability company (“PWS”)
WHEREAS, pursuant to that certain Exchange & Acquisition Agreement dated August 10, 2011, (“EA Agreement”) SEER purchased and acquired from Black Stone management Services, LLC (“BSMS”) certain technology relating to cold plasma oxidation and all the Intellectual Property arising out of or related to the technology (“Technology”); and
WHEREAS, by agreement the Technology currently resides wholly and exclusively in SEER; and
WHEREAS, pursuant to the terms and conditions of the EA Agreement, the parties to that agreement agreed to irrevocably license the Technology to PWS;
WHEREAS, in exchange for various consideration paid and received, and equity distributions, in exchange for licensing the Technology to PWS, PWS has agreed to grant SEER a royalty interest in any and all revenues generated by PWS from any source throughout the world (“ Royalty Territory ”) from the exploitation, utilization or commercialization of the Technology.
WHEREAS, the parties intend that such license to use the Technology will be an exclusive license;
NOW THEREFORE, in consideration of the mutual covenants contained in this Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows.
1.1 Affiliate means, with respect to any specified person, any other person which controls, is under common control with, or is controlled by such specified person.
1.2 Gross Revenues means the gross revenue collected and realized by PWS or its Affiliates during the Term from any and all commercial endeavors in the Royalty Territory directly or indirectly involving the Technology.
1.3 “CoronaLux System” or “Technology” means the combination of pyrolytic and plasma unit as described in US Patent (and/or Provisional) Application 61/648377, and all subsequent additions, improvements, CIP’s and other affiliated patents.
1.4 Royalty means five percent (5%) of Gross Revenues from the sale or lease of the CoronaLux System.
1.5 Term means the period commencing as of the date of this Agreement and shall continue for a period not to exceed the life of the patent or patents filed by SEER.
2.1 License. SEER hereby irrevocably and exclusively grants a world-wide license to PWS of all of its rights to the Technology (“License”) in exchange for the payment by PWS to SEER of any Royalty accruing under this Royalty Agreement on a quarterly basis in arrears. These royalty payments shall be made by PWS out of its retained earnings. In the event PWS has no quarterly retained earnings from which it can make the royalty payment, all such payments shall accrue and be paid out of subsequent retained earnings of PWS. This License shall provide PWS with the exclusive right to exploit, utilize and commercial the Technology in the Royalty Territory for the Term.
2.2 Payment . Within thirty (30) days after the end of each calendar quarter during the Term, PWS shall submit to SEER a statement in writing indicating the Gross Revenues during the previous calendar quarter and a calculation of the Royalty due along with payment of the appropriate Royalty amount (“ Royalty Statement ”). Upon termination or expiration of this Royalty Agreement, all past due Royalties shall be accelerated and shall immediately become due and payable.
2.3 Sub Licenses . PWS may sub license the Technology in the best interest of SEER. Any revenue derived from sub licensing shall be included in the calculation of Gross Revenue for purposes of determining Royalty payments due SEER.
2.4 No Minimum Payments . PWS shall use all commercially reasonable efforts to offer, promote and market the Technology for sale and use in the Marketing Territory. However, SEER agrees and acknowledges that: (a) PWS assumes no obligation to pay any minimum Royalty hereunder; (b) PWS has full power, authority and discretion to establish the price and terms related to the exploitation of the Technology; and (c) there is no guarantee that the marketing or deployment of the Technology will be successful or that the Technology will generate Gross Revenues, or a resulting Royalty, in any minimum amount.
2.5 Audit . PWS agrees to maintain accurate and complete records of all Gross Revenues and Royalty payments made pursuant to this Royalty Agreement (the “Records”). The Records will be retained for a period of at least one (1) year following the date a Royalty payment is made to SEER hereunder. With prior written notice of at least thirty (30) days, DSC agrees to permit SEER or any person or entity designated by SEER to examine and audit the Records, provided that PWS may require such third party representative to sign a non-disclosure agreement prior to any such disclosure. The audit will be conducted during normal business hours at the place the Records are normally maintained and will not unreasonably disrupt PWS’s business. In the event such audit discloses an underpayment or overpayment of Royalties due hereunder, the appropriate party will promptly remit the amounts due to the other party within thirty (30) days. Such audit shall be conducted at SEER’s expense; unless a discrepancy or error resulting in an under-payment exceeding five percent (5%) of the amount actually due is found in conjunction with audit, in which case, the cost of such audit shall be borne by PWS. Prompt adjustment shall be made by the appropriate party to compensate for any errors or omissions disclosed by such audit.
3. TERMINATION AND TRANSFER
3.1 Termination . Notwithstanding the Term, this Royalty Agreement shall terminate upon written notice from one party to the other if the party receiving such notice is in material breach of its obligations hereunder, or if any of its representations hereunder prove false or misleading, and the same is not cured within thirty (30) days from that date of such notice.
3.2 Sale or Transfer . PWS is prohibited from selling or otherwise transferring the Technology without the written consent from the Board of Directors of SEER. Any attempt to sell or transfer the Technology without the written consent of SEER shall be void ab initio .
4. Rights of PWS
4.1 Title . PWS acknowledges SEER’s ownership of the Technology and shall not at any time do or suffer to be done any act or thing which will in any way impair the rights of SEER in and to the Technology.