TECHNOLOGY LICENSE
AGREEMENT
THIS TECHNOLOGY LICENSE AGREEMENT (this
"License"), is made as of August 18, 2005 (the "Effective Date") by
and among Epic Financial Corporation, a Nevada corporation
("Epic"), having an address at 7545 No. Del Mar Avenue, Suite 102,
Fresno, California 93711, Inkway Corporation, a Nevada corporation
("Licensee"), a wholly-owned subsidiary of Epic, having an address
at 7545 No. Del Mar Avenue, Suite 102, Fresno, California 93711, on
one hand, and AccuBrite Inc.
, a New York corporation ("Licensor"),
having an address at 7407 No. Woodson Avenue, Fresno, California
93711, on the other hand (Licensee and Licensor, each a "Party" and
collectively the "Parties"), with respect to the following
facts:
RECITALS
WHEREAS, Licensor owns the rights in and
to the Licensor Technology.
WHEREAS, Licensee desires to license the
Licensor Technology from Licensor.
WHEREAS, Licensor is willing to grant,
and Licensee is willing to accept, a license to the Licensor
Technology on the terms and conditions of this License.
WHEREAS, Epic, Licensor and Licensee have
entered into at certain Management Agreement of even date hereof in
order to maximize the mutual benefits which they might realize
under this License.
NOW, THEREFORE, based on the foregoing
premises and in consideration of the promises contained in this
License, the Parties hereto hereby agree as follows:
1.
DEFINITIONS .
1.1
Confidential Information
. "Confidential Information" means
all information regarding a Party's business or affairs, including,
without limitation, business concepts, processes, methods, systems,
know-how, devices, formulas, product specifications, marketing
methods, prices, customer or user information, customer or user
lists, methods of operation, or other information, whether in oral,
written, or electronic form, of the other Party designated as
confidential or, that based on the circumstances, a reasonable
person would know is confidential. The following information
will not be considered Confidential Information:
(i) information that is or becomes publicly available
through no fault of the Party obligated to keep it confidential;
(ii) information that was rightfully known by a Party prior to
commencement of discussions regarding the subject matter of the
Agreement; (iii) information that was independently developed by a
Party without use of the Confidential Information; and (iv)
information rightfully disclosed to a Party by a third party
without continuing restrictions on its use or disclosure.
1.2
Improvement . "Improvement" means any improvement, modification,
amendment, invention, enhancement, correction, new version, update,
upgrade, advancement, or addition, to or associated with, the
Licensor Technology.
1.3
Intellectual Property
Rights . "Intellectual
Property Rights" means any and all (by whatever name or term known
or designated) now known or hereafter existing throughout the
world: (i) rights associated with works of authorship,
including, without limitation, all exclusive exploitation rights,
copyrights, moral rights, and mask-works; (ii) trade secret rights
and other Confidential Information; (iii) patents (including,
without limitation, reissues, divisions, reexaminations,
extensions, provisionals, continuations and continuations-in-part
thereof), designs, and other industrial property rights; (iv) all
other intellectual and industrial property and proprietary rights
of every kind and nature, whether arising by operation of law,
contract, license, or otherwise; (v) formulas, ideas,
concepts, methods, know-how, processes, devices, and the like,
whether or not any of the foregoing are protectable under law; and
(vi) all registrations, applications, renewals, extensions,
continuations, divisions, reissues, and the like.
1.4
Licensee Improvement
. "Licensee Improvement" means an
Improvement solely paid for by Licensee.
1.5
Licensor Technology
. "Licensor Technology" means all
Intellectual Property Rights and all matters in support of the
Intellectual Property Rights, including all ink technology,
formulation and designs currently owned or used by Licensor in
connection with manufacture, distribution, and application of ink
products by Licensor, including, without limitation the technology
described on Schedule A, and all Improvements thereto,
except the Licensee Improvements.
1.6
Net Revenue . "Net Revenue" means the "net profits before
taxes" (as defined by U.S. GAAP), of Licensee as reflected in the
Licensee's annual audited financial statements for the Licensee's
fiscal years ending October 31.
1.7
Adjusted Gross Revenue
. "Adjusted Gross
Revenue" means gross revenues minus cost of goods sold, costs of
media and costs of delivery.
2.
LICENSE .
2.1
Grant . Licensor grants to Licensee, and Licensee
hereby accepts from Licensor, upon the terms and conditions in this
License, a world-wide, perpetual, irrevocable, exclusive (as to the
world, including the Licensor), transferable, royalty-bearing,
right and license to make, use, sell, offer to sell, improve, or
otherwise obtain benefits, directly or indirectly, from or in
respect of the Licensor Technology, without any limitations, except
as subject to the terms and conditions set forth herein.
2.2
Right to Grant Sub-Licenses
. Licensee shall have the right to
sublicense any or all of the rights granted in Section 2.1 to one
or more third parties with the prior written consent of
Licensor.
3.
PROPRIETARY RIGHTS
.
3.1
Registration . From time to time at its sole cost and
expense, Licensor shall have the right, but not the obligation, to
seek patent protection, registration, or similar protection
(collectively, "Registrations") of or for its Intellectual Property
Rights in and to the Licensor Technology or any Improvements
thereto, except Licensee Improvements. Any rights conferred
to Licensor under any Registration will automatically be included
within the scope of the license granted to Licensee in Section 2.
3.2
Ownership of Intellectual Property -
Licensee Improvements .
Licensee shall own all Intellectual Property Rights in and to
any Licensee Improvements.
3.3
Confidentiality
.
(a)
Obligation of
Confidentiality . Each
Party shall: (i) hold all Confidential Information of the other
Party in confidence using at least the same measures as it does to
protect its own Confidential Information of a similar nature, but
not less than reasonable care, and not disclose the Confidential
Information to any third party except to the extent permitted by
the terms of this License; (ii) not remove or permit to be
removed from any item any proprietary, confidential or copyright
notices, markings or legends placed thereon by either Party; (iii)
use the other Party's Confidential Information only in the course
of performance pursuant to this License; and (iv) disclose the
other Party's Confidential Information only to those of its
employees, representatives, agents and contractors that need to
know it, and only for the purpose of rendering assistance to the
Party performing its obligations under this License. Promptly
following the request of a Party owning Confidential Information or
upon expiration or termination of this License, each Party shall
return to the other Party all such other Party's Confidential
Information delivered or disclosed, together with all copies
thereof at any time made by such Party.
(b)
Disclosure Required by Law
. Either Party shall have the right
to disclose Confidential Information as required by law or legal
process or under the applicable rules of a securities market or
exchange; provided, however, that the disclosing Party shall use
reasonable efforts to give the other Party a reasonable opportunity
to intervene to prevent such disclosure or to obtain a protective
order, and that any Confidential Information so disclosed otherwise
remains subject to the confidentiality obligations set forth in
this Section.
3.4
No Challenge To Rights
.
Neither Party shall do
anything that may adversely affect the validity or enforceability
of any Intellectual Property Right owned by the other Party,
including, without limitation, any act, or assistance to any act,
that may infringe or lead to the infringement of any such
Intellectual Property Right.
3.5
Injunctive Relief
. Each Party agrees that if it
breaches any of its obligations with respect to the other Party's
Confidential Information or infringes the other Party's
Intellectual Property Rights, it will cause the other Party
irreparable injury that cannot be readily remedied in monetary
damages in an action at law. Therefore, each Party agrees that the
other shall be entitled to obtain, on an expedited basis from any
court of competent jurisdiction, and without the requirement of the
posting of a bond, immediate injunctive relief to enjoin any such
breach or prospective breach or any infringement or prospective
infringement. The foregoing shall be in addition to, and not
in lieu of, such other remedies as a Party may otherwise have
available to it under applicable law.
4.
ROYALTIES AND PAYMENTS
.
4.1
Upfront Payment
. As consideration for the rights
granted to Licensee in Section 2, upon execution of this License,
Epic shall:
(a)
cancel, discharge and release Licensor
from all outstanding obligations owing to Epic, as evidenced and
owing under those certain promissory notes between Epic and
Licensor dated April 5, 2005, May 5, 2005, June 5, 2005, July 5,
2005 and August 17, 2005 in the principal outstanding aggregate
amount of $64,000 and all interest accrued thereunder;
and
(b)
issue, transfer and deliver 3,800,000
restricted shares of Epic's common stock, par value $0.001 ("Epic
Shares") to Licensor.
4.2
Ongoing Royalty
. From and after the date hereof,
Licensee shall pay Licensor 25% of all Net Revenue of Licensee (the
"Ongoing Royalty Payments"). The Ongoing Royalty Payments shall be
made in the form of cash advances on available cash flow of
Licensee. As soon as Inkway's cash flow permits it, such cash
advances shall be paid monthly in an amount equal to 20% of
Adjusted Gross Revenue of Inkway for the prior month.
4.3
Payment Terms . Any adjustments between the cash advances and
the Ongoing Royalty Payments that may be due Licensor under this
License shall be made as soon as reasonably practicable following
completion of the Licensee's annual audited financial statements
for each of Licensee's fiscal years, beginning as of the end of the
fiscal year which starts October 31, 2005. If there has been
an overpayment of cash advances as reconciled against the Ongoing
Royalty Payments, future cash advancements and future Ongoing
Royalty Payments shall be adjusted accordingly. In connection with
each such Ongoing Royalty Payment, Licensee shall furnish a
statement, in reasonable detail, setting forth the amount of Net
Revenue received and its calculation of the royalties due to
Licensor for such Ongoing Royalty Payment.
4.4
Effect of Termination of Management
Agreement . In the event
that the Management Agreement by and between the parties hereto
(the "Management Agreement") is terminated, for any reason, the
cash advances towards the Ongoing Royalty Payments shall be
modified to be 40% of Adjusted Gross Revenue of Licensee and the
Ongoing Royalty Payments shall be modified to be 50% of all Net
Revenue of Licensee, both effective as of the date of termination
of the Management Agreement.
5.
ENFORCEMENT . Each Party shall notify the other Party
promptly in writing of any suspected infringement or
misappropriation of the Intellectual Property Rights of the other
Party by a third party and shall provide the other Party with all
documents and information relating thereto. With respect to
any Intellectual Property Right owned by either Party, the owner of
said right shall have the right, but not the obligation, to take
action in its own name to secure the cessation of any infringement
or misappropriation of the Intellectual Property Right or to bring
an action against the alleged infringer. The Party bringing
the action shall bear the expense of prosecuting any infringement
action and shall be entitled to any monies recovered in such an
action. In any suit or dispute involving an alleged infringer, each
Party shall fully cooperate with the other Party. At the
request and expense of any Party, the other Party shall permit
access to all relevant personnel, records, papers, information,
samples, and the like, during regular business hours.
6.
REPRESENTATIONS AND WARRANTIES OF THE
PARTIES. Each Party hereby represents and warrants to the
other that:
6.1
Power and Authority
. It has the full right, power and
authority to (i) enter into this License, (ii) grant or receive all
rights that have been licensed under this License and
(iii) perform its obligations under this License. The
execution and delivery of this License and the consummation of the
transactions contemplated hereby have been duly authorized by the
respective parties.
6.2
Binding Agreement; No
Violation . This License
constitutes the legal, valid and binding obligations of the
respective Parties hereto, enforceable in accordance with its terms
(except as such enforcement may be limited by applicable
bankruptcy, insolvency, moratorium, or similar laws affecting the
rights of creditors generally or general principles of equity).
Neither the execution, delivery or performance of this
License, nor the consummation of the transactions contemplated
hereby, nor the compliance with the terms of this License, will
result in a breach of any term or provision of said Party's
corporate charter or bylaws or to the best of its knowledge, any
statute, rule or regulation applicable to said Party, nor conflict
with or constitute a default under any agreement to which a Party
hereunder is bound or to which its assets are subject, or any
instrument, judgment, decree, writ, or other restriction to which a
Party or its assets are bound.
6.3
No Infringement
. To its knowledge, the exercise of
the rights granted to the other Party under or in the course of
performance of this License will not infringe, violate, or
otherwise interfere with the trademark, Intellectual Property
Right, contractual or other right of any third party anywhere in
the world.
7.
REPRESENTATIONS AND WARRANTIES OF
LICENSOR. Licensor hereby represents and warrants to Epic and
Licensee that:
7.1
Investment Intent
. Licensor