EXHIBIT 10.1
THE INTEREST IN THE SECURITIES CONTEMPLATED IN THIS EXPANDED
AGREEMENT WILL BE
ACQUIRED, IF AT ALL,
FOR INVESTMENT
AND NOT WITH A VIEW
TO, OR IN
CONNECTION
WITH, THE SALE OR
DISTRIBUTION
THEREOF. NO SUCH SALE OR DISPOSITION MAY BE
AFFECTED WITHOUT AN
EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN
OPINION OF COUNSEL
SATISFACTORY TO THE
ISSUER THAT SUCH
REGISTRATION
IS NOT
REQUIRED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
EXPANDED USE LICENSE AGREEMENT
THIS
EXPANDED USE LICENSE AGREEMENT ("Expanded Agreement") is made
effective as of 12th day of October, 2005 by and between XsunX,
Inc., a Colorado
Corporation ("XsunX"),
and MVSystems, Inc., a
Colorado Corporation ("MVS") and
Arun Madan, an individual ("Dr. Madan"). XsunX, MVS, and Dr. Madan
are sometimes
herein referred to individually as a "party" and collectively as
the "parties."
R E C I T A L S
A. WHEREAS, MVS, Dr.
Madan and XsunX have previously entered into that
certain Technology
Sharing and License Agreement dated September 17, 2004
("Technology Sharing
and License Agreement"), for the purposes described
therein, and the
parties now wish to expand and define the scope and use of
technology to include
the development of opaque solar cell structures and
manufacturing methods; and
B. WHEREAS, MVS and
Dr. Madan desire to expand and/or further define
the use of licensed
technology, know-how,
and patents to XsunX
for use in the
development of opaque photovoltaic technologies and manufacturing
methods; and
C. WHEREAS, the parties desire to enter into this
Expanded Agreement
for the development and commercialization of opaque
photovoltaic
technologies;
and
NOW, THEREFORE,
in consideration of the mutual promises contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties hereto agree as
follows:
1.
DEFINITIONS
1.1. "Act" means the
Securities
Act of 1933
promulgated by the
United States
Securities and Exchange Commission.
1.2. "Expanded
Agreement" means this Expanded Use License Agreement, including
the schedules and exhibits attached hereto, which are incorporated by
reference
herein.
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1.3. "Commercial,"
"Commercialize,"
or "Commercialization of the 4 Terminal
Patent" means
the development of process related thereto to the point of
obtaining a
marketable
product consisting of the core solar cell
structure
design and
the manufacturing techniques deliverable in the form of a
commercially scalable
manufacturing
process,
and the actual realization
thereupon of Ten Million Dollars ($10,000,000) cumulative revenue for the
sales
and licensure of such technologies and manufacturing process by five (5) years
from the effective date of completion of such development.
1.4. "Derivative
Works" mean works of the parties, including products or
processes, associated with any subsequent research by any party,
development, or
combination of technologies of the parties after the Commencement Date, which
are useful or specific to XsunX Expanded Field of Use or the Expanded
Business
of XsunX or which may otherwise become subject to the terms of the
provisions
set forth in this
Expanded Agreement
or those of the
Technology
Sharing and
License Agreement.
1.5. "Expanded Use
License" means that certain license set forth in Section 2.1
of this Expanded Agreement.
1.6. "Expanded
Use License
Stock Warrant" means that certain stock warrant
contemplated at Section 4 of this Expanded Agreement.
1.7. "Expanded
Use License
Stock Warrant Shares" mean those shares of
XsunX
obtained upon the exercise of the License Stock Warrant, as set
forth at Section
4 of this Expanded Agreement.
1.8. "XsunX
Expanded Field of Use"
The XsunX Expanded Field of Use pertains to
the business of developing and commercializing semi-transparent and
opaque solar
cells and photovoltaic technologies, solar cell panels, and methods of
manufacture.
1.9. "Expanded
Business of XsunX" XsunX is in the business of developing,
manufacturing, and
marketing semi-transparent and opaque solar cells and
photovoltaic technologies, solar cell panels, and methods of
manufacture.
1.10. "Joint
Licensing and Equipment Revenue Fees" means the fixed costs,
percentages, mark-ups,
and/or revenue sharing
specifications
as set forth in
this Expanded Agreement.
1.11. "Opaque Solar Cell Development" means the development of
opaque solar cell
structures and manufacturing methods employing the techniques
proposed within,
but not limited to, U.S. Provisional Patent Application serial
number 60/536,151
- three terminal and four terminal solar cells, solar cell panels,
and method of
manufacture, and
other technology, as set fort therein, a copy of which is
attached hereto
as Exhibit "H" and incorporated herein, the ("4 Terminal
Patent"). The
completed development and refinement of the 4 Terminal Patent,
or
any derivative works there from, and any other acquired or licensed
technologies
are intended to produced commercially marketable products and manufacturing
processes of opaque solar cell devices. The development of the 4
Terminal Patent
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will exclude the use
of
Copper-Indium-Gallium-Selenium ("CIGS") materials in
solar cell structures so long as it pertains to services provided
by MVS and the
use of the MVS
reel-to-reel cassette
manufacturing
system by XsunX in the
Expanded Business of XsunX.
1.12. "Technology
Sharing and License
Agreement" means that certain Technology
Sharing and License Agreement dated September 17, 2004, entered
into by MVS, Dr.
Madan and XsunX.
1.13. All other terms
used herein which are not otherwise defined herein shall
have the meaning set forth in the Technology Sharing and License
Agreement.
2. LICENSE
PROVISIONS
2.1. Grant of Expanded Use License. Subject to the terms and
conditions of this
Expanded Agreement,
and subject to the
terms and conditions
of the Technology
Sharing and License Agreement, and in exchange for the
considerations set forth
herein, MVS and Dr. Madan, jointly and severally, hereby grant to XsunX for the
term of this Expanded
Agreement, and XsunX
accepts, an expanded use license of
and to the Licensed
Patents and
Technology, with the
right to sublicense,
to
import, make,
have made,
use, sell,
offer for sale, have
sold, and otherwise
commercially exploit
the Licensed subject
matter of the Licensed
Patents and
Technology within the
XsunX Expanded Field
of Use, provided
however that Dr.
Madan and MVS
retain the right to use the Licensed Patents and Technology
themselves and to lend
or transfer them to a university or non-profit research
organization, and to
commercially
license or transfer the use of US Patent
6,488,777 B2, and US Patent 6,258,408 B1- Semiconductor vacuum
deposition system
and method having a reel-to reel substrate cassette, the ("Cassette Patent") so
long as such use or transfer of any of the above does not defeat or
diminish the
economic benefit and commercial ability of such Licensed Patents
and Technology
that may be derived by
XsunX within
the XsunX Field of Use and the Expanded
Business of XsunX.
2.2. Retained
Rights. Notwithstanding the grant of the Expanded Use License
herein, and
pursuant to the
provisions
of this Expanded Agreement and the
Technology Sharing and
License Agreement,
MVS and Dr.
Madan shall retain
the
right to use
the Licensed Patents and technology in the Business of MVS
including the right to manufacture its machines and the reel-to
reel technology,
provided such use
does not defeat or diminish the economic benefit and
commercial ability
of the technology transfer that may be derived by XsunX
within the Xsunx
Expanded Field of Use and the Expanded Business of XsunX. In
addition XsunX is not licensed to provide this technology to any
third party for
uses outside of the Expanded Business of XsunX.
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2.3. Expiration of Expanded Use License. The Expanded Use License
granted herein
shall, subject
to expiration as set forth herein, be perpetual and
self-renewing.
Notwithstanding the foregoing, in the event that XsunX fails
to
Commercialize the 4
Terminal Patent
within five (5) years
from the effective
date of completion of the development of the 4 Terminal Patent, the
Expanded Use
License granted
above shall expire as
to that technology or
part thereof that
was not Commercialized.
2.4. Intent and Scope of Expanded Use License. The Expanded Use License
granted
herein is intended to eliminate the five percent (5%) transmisivity limitation
as specified
within the
Technology
Sharing and License
Agreement effective
September 17, 2004 between the parties, and to allow the use of all
technologies
licensed, including
any derivative works there from, to be utilized
by XsunX
within the XsunX
Expanded Field of Use
and in the development
of the Expanded
Business of XsunX as defined herein.
2.5. Derivative
Works. All Derivative Works of the parties resulting from
research or work
funded by, or
Confidential
Information provided
by, XsunX
associated with
any subsequent research by any party, development, or
combination of technologies of the parties after the Commencement Date, which
are useful or
specific to the XsunX Expanded Field of Use or the Expanded
Business of XsunX,
shall become the property of XsunX, subject to the terms of
separate joint licensing agreements between the parties
intended to provide MVS
use of such technology
in applications
not in direct or
indirect
competition
with or adverse to XsunX in light of the XsunX Expanded Field of
Use.
3. JOINT
LICENSING AND EQUIPMENT REVENUE FEES
3.1. Obligations
of MVS. MVS and Dr. Madan shall, subject to the specific
provisions of any
development
proposal then approved by XsunX, MVS and Dr.
Madan, and
subject to the confidentiality provisions set forth within the
Technology Sharing and License Agreement, share the technology
referenced herein
and therein
with XsunX and provide research, development, consultation,
materials, tools, instruments, and facility Services for the
benefit of XsunX at
Cost for the development of technologies pertinent to the Expanded
Business of
XsunX and for
performance
under this Expanded Agreement. Approval of any
development proposal shall not be unreasonably withheld by MVS and
Dr. Madan.
3.2. Joint
Licensing and Equipment Revenue Fees. The parties agree to the
provisioning of fixed costs and the sharing of revenues to and from
the sale and
licensure of equipment and technology resulting from the commercialization of
the Licensed
Patents and
Technology
under this
Expanded Use License
and the
Technology Sharing and License Agreement as follows:
3.2.1. Opaque Solar
Cell Technology
License Revenue Sharing. Upon the
successful completion
of the development
of the 4 Terminal
Patent, which is
intended to produce
commercially
marketable opaque
solar cell structures
and
manufacturing methods,
XsunX shall begin
licensing efforts of the developed
opaque technologies.
If after twelve (12) months from the date of first
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