EXHIBIT 10.11
LICENSE AGREEMENT
This License Agreement is entered into effective as of December 1, 2002
(the "Effective Date") by and between Appllca Consumer Products, Inc., with
offices at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ("Applica")
and Technology Research Corporation, with offices at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ("TRC") (collectively, "the Parties").
WHEREAS, Applica is involved in the design, manufacture and marketing of a
broad range of branded and private-label consumer goods; and
WHEREAS, TRC is engaged in development and commercialization efforts for
consumer product safety circuit technology involving shock detection,
insulation failure detection, flame detection and/or automatic shut-off; and
WHEREAS, Applica and TRC wish to cooperate as set forth herein, to enable
the development, manufacture, marketing and sale by Applica of Household
Kitchen Appliances using the TRC Licensed Technology (each as defined below);
and
WHEREAS, Applica and TRC intend that this License Agreement cover the
terms and conditions of such development, manufacture, marketing and sale.
NOW, THEREFORE, the Parties agree as follows:
1. Definitions. As used herein, the following terms shall have the meanings
set forth below.
(a) "Affiliates" means any corporation or other entity which is directly or
indirectly controlling, controlled by or under the common control with a party,
where "control" means the direct or indirect ownership of more than fifty
percent (50%) of the outstanding shares or other voting rights of the subject
entity to elect directors (or in the case of an entity that is not a
corporation, interests entitled to vote in the election of the corresponding
managing authority). As used herein, the terms "Applica", "TRC", "Party" and
"Parties" include each party's respective Affiliates.
(b) "Intellectual Property Rights" means patents, copyrights, mask work rights,
trade secrets, know-how, any and all legal rights protecting proprietary
information, Confidential Information (as defined in section 10 below), and
other intellectual property in existence prior to the termination or expiration
of this License Agreement, but excluding rights in trademarks, trade names,
service marks, or other product or corporate identifications.
(c) "Improvement" means any alteration, change, modification, contribution,
development, or innovation. Improvements include (without limitation):
formulas, algorithms, methods, processes, databases, mechanical and electronic
hardware, electronic components, computers and their parts, computer languages,
computer programs and their documentation, encoding techniques, articles,
writings, compositions, works of authorship, contributions, innovations and
other know-how.
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(c) "TRC Innovations" means any Improvement conceived solely by TRC (i.e.,
without contribution from Applica), related to or useful for the use of the
safety circuit technology described in attached Exhibit A in a Household
Kitchen Appliance, and not generally known by those in the fields of consumer
product design, including but not limited to the best, optimal or an otherwise
improved method to in whole or part carry out or implement the TRC Licensed
Technology in a Household Kitchen Appliance.
(d) "Applica Innovations" means any Improvement conceived solely by Applica
(i.e., without contribution from TRC), related to or useful for the use of the
safety circuit technology described in attached Exhibit A in a Household
Kitchen Appliance, and not generally known by those in the fields of consumer
product design, including but not limited to the best, optimal or an otherwise
improved method to in whole or part carry out or implement the TRC Licensed
Technology in a Household Kitchen Appliance.
(e) "Joint Innovations" means any Improvement conceived by either Applica or
TRC with contribution from both Applica and TRC, related to or useful for the
use of the safety circuit technology described in aftached Exhibit A in a
Household Kitchen Appliance, and not generally known by those in the fields of
consumer product design, including but not limited to the best, optimal or an
otherwise improved method to in whole or part cany out or implement the TRC
Licensed Technology in a Household Kitchen Appliance.
(f) "TRC Licensed Technology" means (i) the safety circuit technology
described in attached Exhibit A; (ii) TRC Innovations; (iii) TRC Patents; and
(iv) know-how related to, or useful for, the use of all or part of the
technology described in (i), (ii), and (iii) herein, in Household Kitchen
Appliances.
(g) "TRC Patent(s)" means all patent applications and any patents issued
therefrom, in any country, including but not limited to any and all
continuation, divisional, continued, continuing, continuation-in-part, or
reissue thereof, including one or more issued or pending claims covering any
part of (i) the safety circuit technology described in attached exhibit A;
(ii) TRC Innovations; and (iii) know-how related to, or useful for, the use of
all or part of the technology described in (i) and (ii) herein, in Household
Kitchen Appliances, including without limitation U.S. patent number 6,525,914
issued February 25, 2003.
(h) "Applica Patent(s)" means all patent applications and any patents issued
therefrom, in any country, including but not limited to any and all
continuation, divisional, continued, continuing, continuation-in-part, or
reissue thereof, including one or more issued or pending claims covering any
Applica Innovations.
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(i) "Joint Patent(s) means all patent applications and any patents issued
therefrom, in any country, including but not limited to any and all
continuation, divisional, continued, continuing, continuation-in-part, or
reissue thereof, including one or more issued or pending claims covering any
Joint Innovations, including without limitation U.S. patent application serial
number 10/255,167 filed September 24, 2002.
(j) "Household Kitchen Appliances" means products such as toasters, toaster
ovens, and coffee makers, of the type typically sold through consumer retail
outlets, including but not limited to the following types of retail outlets:
mass merchant (e.g., Wal-Mart, Target, K-Mart); department store (e.g., Macy's,
Dillards); home centers (e.g., Home Depot, Lowe's); hardware (e.g., Ace
Hardware, True Value); discounters (e.g., Dollar Stores); liquidators (e.g.,
Consolidated); sporting goods (e.g., Oshmans, SportMart); electronic (e.g.,
Home Shopping Network, QVC, ▇▇▇▇▇▇.▇▇▇); club (e.g., COSTCO, Sam's Club);
specialty catalog (e.g., Sharper Image, Brookstone, Sky Mall); and other
specialty retailers (e.g., Linens-N-Things, Bed, Bath & Beyond, Best Buy, Fry's
Electronics), but shall not include products specifically designed for and
specifically distributed to or through industrial or commercial applications
for use therein.
2. Cooperation and Development. The Parties agree to cooperate from time to
time upon mutually agreeable terms (to be set forth in separate written
agreements) with respect to the development and manufacture of Applica
Household Kitchen Appliances that exploit the TRC Licensed Technology. TRC
shall provide Applica with written reports, test data, prototypes, product
information, component sourcing information, engineering drawings,
calculations, and any other TRC Licensed Technology reasonably required by
Applica for the development and manufacture of such Household Kitchen
Appliances. Upon mutually agreeable terms, TRC shall provide assistance to
Applica in the process for obtaining U.L. certification for such Household
Kitchen Appliances.
A TRC Fee Schedule for such cooperation and assistance, which schedule is non-
binding and subject to further negotiation and approval of both TRC and Applica
in the context of future specific proposed projects, is attached hereto as
Exhibit B.
3. License Grants and Restrictions.
(a) TRC Grant - Americas Region.
(i) Household Kitchen Appliances. TRC hereby grants to Applica in and
throughout North, Central and South America and the Caribbean (the "Americas
Region") an exclusive, perpetual, irrevocable but subject to the termination
clauses herein, royalty-bearing license under TRC Licensed Technology, to
design, have designed, to make, have made, offer for sale, sell, assemble, have
assembled, test, have tested, use and otherwise dispose of Household Kitchen
Appliances that exploit the TRC Licensed Technology.
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(ii) Other Consumer Products. TRC hereby grants to Applica for the Americas
Region (as defined in paragraph 3(a)(i) above) a right of first refusal and
option for the TRC Licensed Technology for an exclusive, perpetual, irrevocable
but subject to the termination clauses herein, royalty-bearing license under
the TRC Licensed Technology, to design, have designed, to make, have made,
offer for sale, sell, assemble, have assembled, test, have tested, use and
otherwise dispose of consumer products that are not Household Kitchen
Appliances covered by the grant of paragraph 3(a)(i) above. For each Americas
Region country, TRC may engage itself or with third parties related to the
design, development, manufacture, distribution, marketing or sale of such
consumer products in or for such country if, within a sixty (60) day period
from TRC having provided Applica with a detailed written notice including:
(x) an identification of the country; (y) a statement of specific desire to
move forward in such country; and (z) a reference to this section 3 of this
Agreement and to such 60-day period, Applica has failed to exercise its right
of first refusal and option. The Parties agree that such 60-day period may be
extended by mutual written consent of the Parties.
(b) TRC Grant - Other Regions. TRC hereby grants to Applica for each country
outside of the Americas Region (as defined in paragraph 3(a) above) a right of
first refusal and option for an exclusive, perpetual, irrevocable but subject
to the termination clauses herein, royalty-bearing license under TRC Licensed
Technology, to design, have designed, to make, have made, offer for sale, sell,
assemble, have assembled, test, have tested, use and otherwise dispose of
Household Kitchen Appliances in or for each such country. For each such
country, TRC may engage itself or with third parties related to the design,
development, manufacture, distribution, marketing or sale of such Household
Kitchen Appliances in or for such country if, within a sixty (60) day period
from TRC having provided Applica with a detailed written notice including:
(x) an identification of the country; (y) a statement of specific desire to
move forward in such country; and (z) a reference to this section 3 of this
Agreement and to such 60-day period, Applica has failed to exercise its right
of first refusal and option. The Parties agree that such 60-day period may be
extended by mutual written consent of the Parties.
(c) Except as specifically provided in section 18(a) of this License
Agreement, nothing in this contract shall be construed to understand that
Applica has the right to otherwise transfer to any third party the rights
granted to Applica by TRC under this License Agreement.
(d) Sublicensing. Applica has the right to sublicense to any third party the
rights granted to Applica by TRC under this License Agreement, subject to the
terms and conditions set forth in this License Agreement. TRC and Applica
shall share equally (i.e., 50/50 split) all royalty payments received by
Applica from any sublicensees. In the event that the rights granted to Applica
hereunder by TRC are automatically converted from exclusive to non-exclusive
rights pursuant to paragraph 4(c)(iii) below, TRC shall have the right to grant
non-exclusive rights to third parties for the rights granted to Applica by TRC
under this License Agreement, and TRC and Applica shall share equally (i.e.,
50/50 split) all royalty payments received by TRC from any such licensees.
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(e) Representation and Warranties. TRC represents and warrants that (i) TRC
has the right to grant the licenses granted herein, and to transfer or
disclose, as the case may be, the TRC Licensed Technology to Applica under this
License Agreement, and (ii) to the best knowledge of TRC, the TRC Licensed
Technology does not infringe on the intellectual property rights of any third
party.
(1) No Applica Grant. Applica under this License Agreement does not grant to
TRC any license, sublicense, use or other right for or to any information,
materials, innovations, technology or other know-how owned or controlled by
Applica, except as specifically set forth herein.
(g) Jointly Owned Technology. For Joint Innovations and Joint Patents,
(collectively "Jointly Owned Technology") the Parties acknowledge and agree
that both Parties enjoy rights equivalent to TRC and Applica having granted to
each other a fully-paid, worldwide cross-license to make, have made, use, sell,
offer for sale, lease or otherwise dispose of such Jointly Owned Technology,
but that the Parties agree and are subject to the following restrictions:
(i) Applica may not exploit Jointly Owned Technology in the development,
manufacture or sale of products other than Household Kitchen Appliances without
the advance written consent of TRC;
(ii) TRC may not exploit Jointly Owned Technology in the development,
manufacture or sale of any products without the advance written consent of
Applica;
(iii) Applica may not grant to any third party without the advance written
consent of TRC any license or sublicense to Jointly Owned Technology that would
exploit such Jointly Owned Technology in the development, manufacture or sale
of products other than Household Kitchen Appliances; and
(iv) TRC may not grant to any third party without the advance written consent
of Applica any license or sublicense to Jointly Owned Technology that would
exploit such Jointly Owned Technology in the development, manufacture or sale
of any products; and
(v) Neither TRC nor Applica may threaten or initiate any legal action against
any third party concerning any Jointly Owned Technology without the advance
written consent of the other, which consent shall not be unreasonably withheld.
4. Payments.
(a) Household Kitchen Appliances Royalty Payment. During the term of this
License Agreement, for each unit manufactured by Applica of a Household Kitchen
Appliance covered by a claim of a TRC Patent, Applica shall pay TRC a royalty
of US$0.10.
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(b) Most Favored Licensee. If TRC grants to any third party a license to
manufacture or sell Household Kitchen Appliances that exploit the TRC Licensed
Technology under circumstances requiring payment by such third party of a
royalty at a rate ("Third Party Royalty Rate") which is which is less than the
royalty rate then enjoyed by Applica for Household Kitchen Appliances that
exploit the TRC Licensed Technology, then: (i) TRC shall promptly notify
Applica of such Third Party Royalty Rate, and (ii) Applica shall automatically
enjoy for such Household Kitchen Appliances, effective as of the effective date
of such third party grant by TRC, a royalty rate of not more than such Third
Party Royalty Rate.
(c) Minimums and Non-Performance Penalties.
(i) Applica shall pay TRC a one-time, non-refundable payment of US$50,000 if
Applica does not market launch a product exploiting the TRC Licensed Technology
on or before June 30, 2004.
(ii) In specific consideration of future activities of TRC and Applica toward
the establishment of a UL mandate for use of the TRC Licensed Technology in
Household Kitchen Appliances, Applica agrees that a minimum royalty payment of
US$100,000 will be paid to TRC under this Agreement for calendar year 2005. If
the cumulative amount actually paid to TRC pursuant to paragraph 4(a) above for
calendar year 2005 is less than US$100,000, then no later than February 14,
2006, Applica shall pay TRC, in addition to the amount due under paragraph 4(a)
for the immediately preceding calendar quarter (the "Q4 2005 Payment Amount"),
the difference between US$100,000 and the Q4 2005 Payment Amount.
(iii) For each of calendar years 2006 and 2007, if the cumulative amount
actually paid to TRC pursuant to paragraph 4(a) above for such calendar year is
less than US$150,000, then no later than February 14 of the immediately
following calendar year, Applica shall have the option of either: (x) paying
TRC, in addition to the amount due under paragraph 4(a) for the respective
immediately preceding calendar quarter (the "Respective Q4 Payment Amount"),
the difference between US$150,000 and the Respective Q4 Payment Amount; or (y)
automatically converting all exclusive rights granted to Applica hereunder by
TRC to non-exclusive rights.
(iv) The Parties agree to meet at a mutually convenient time and place on or
about the end of 2005 to assess and discuss future opportunities for the
commercialization of the TRC Licensed Technology, and to renegotiate with
respect to the terms set forth in paragraph 4(c)(iii) above.
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5. Royalty Reports and Payment Terms. Within forty-five (45) days after the
end of each quarter year ending on the last day of March, June, September and
December of each calendar year during the Term, Applica shall provide TRC with
a written statement reflecting Applica's sales of Household Kitchen Appliances
that exploit the TRC Licensed Technology during the immediately preceding
calendar quarter and shall pay the amount (if any) due pursuant to section 4
above. The first statement provided by Applica under this Agreement shall
cover the period commencing with the first sale of such Household Kitchen
Appliances to the end of the quarter being reported. All payments made by
Applica under this License Agreement will be payable by Applica in United
States dollars to TRC at the following address: Technology Research
Corporation, ATTN: ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇, or at any other address specified by TRC in a notice provided to Applica
in accordance with the terms of paragraph 18(e) below.
6. Accounts. Applica shall keep, for three (3) years after the date of each
submission to TRC of a written statement under paragraph 5 above, true and
accurate records and books of accounts containing data reasonably required for
verification of Applica's manufacture of Household Kitchen Appliances that
exploit the TRC Licensed Technology. Applica shall permit a public accountant
selected by TRC and approved by Applica (which approval by Applica shall not be
unreasonably withheld) to inspect such records and books of accounts during
normal business hours at Applica's premises or another mutually agreed-upon
location, provided: (i) that reasonable prior notice of the inspection is given
to Applica, (ii) that no more than one inspection takes place in any
consecutive 12-month period, and (iii) that the inspection is for not more than
the immediately prior three-year period. All expenses associated with the
inspection shall be borne by TRC unless the inspection reveals an underpayment
by Applica of more than ten percent (10%) of the amount that should have been
paid during the period for which the inspection was conducted. In the event of
such underpayment, Applica shall pay the reasonable costs of such inspection.
If the public accountant shall determine that additional payment is due, TRC
shall issue an invoice for such additional amount with supporting documentation
by the public accountant, and Applica agrees to pay such invoice with twenty
(20) business days of receipt. If the inspection reveals an overpayment by
Applica, TRC shall provide Applica with prompt notice of such overpayment and
shall within twenty (20) business days refund to Applica the overpaid amount.
7. Ownership of Intellectual Property.
(a) Each Party shall own its technology, intellectual property, and know-how
developed independently of the other Party.
(b) The Parties shall jointly own any jointly-developed technology,
intellectual property, and know-how, and TRC and Applica shall enjoy such
ownership subject to the provisions of section 3(g) above.
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8. Option to Acquire TRC-Owned Patents and Rights. Applica shall enjoy a
right of first refusal to acquire from TRC the TRC Patents and other TRC-owned
Intellectual Property Rights to which this License Agreement generally is
directed.
9. Term and Termination.
(a) This License Agreement will remain in effect for a period from the
Effective Date until the latest expiration of any TRC Patent or Joint Patent,
unless this License Agreement is terminated earlier: (i) for convenience at any
time by mutual written consent of the Parties; or (ii) pursuant to one of the
provisions of paragraph 9(b) below.
(b) Either Party has the right to terminate this Agreement under and subject
to any of the following conditions:
(i) breach of any material provision of this Agreement by the other Party,
provided that the other Party does not cure or remedy such breach within thirty
(30) days after receipt of written notice of such breach.
(ii) the other Party becomes subject of a voluntary or involuntary petition in
bankruptcy or any proceeding relating to insolvency, receivership, liquidation
or composition for the benefit of creditors if such petition or proceeding is
not dismissed with prejudice within sixty (60) days after filing.
(c) Absent any cure, termination of this License Agreement under any provision
of paragraph 9(b) above shall be effective thirty (30) days after issuance of a
written notice of termination to the other Party by the non-defaulting Party.
(e) Effect of Termination. Paragraphs 3(g), 5, 6, 7, 9, 10, 14, 15, 16 and 18
shall to the extent applicable survive any expiration or termination of this
License Agreement.
(f) No Waiver of Default. The failure of either Party to exercise a right of
termination hereunder for any one or more defaults shall not be construed to
prejudice such Party's right of termination hereunder for such or any other or
subsequent default.
(g) Automatic Termination of Former Affiliates. The rights under this
Agreement of each Affiliate of a Party automatically shall terminate as of the
date each such entity ceases to be an Affiliate of such Party.
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10. Confidentiality.
(a) Definition of Confidential Information. "Confidential Information" shall
mean that information of either Party or its Affiliates ("Discloser") which is
developed under this License Agreement or which is disclosed to the other Party
("Recipient") by reason of the Parties' relationship under this License
Agreement, either directly of indirectly, in any written or recorded form,
orally, or by inspection, and, either in writing and marked as "confidential,"
"proprietary," or in some other similar and readily discernable manner, or if
disclosed orally, is identified or reduced to writing similarly marked, within
thirty (30) days of disclosure. Notwithstanding the foregoing, Confidential
Information shall not include any information that: (i) was in the public
domain at the time it was disclosed; (ii) was known to Recipient at the time of
disclosure and not subject to a duty of confidentiality at the time of
disclosure, and as can be evidenced in writing; (iii) is disclosed with the
prior written approval of the other Party hereto; (iv) is disclosed to others
without restrictions to confidentiality; (v) was independently developed by
Recipient without use of or reference to the Confidential Information of the
other party, and as can be evidenced in writing; or (vi) becomes known to
Recipient, on a non-confidential basis, from a source other than the other
party hereto, without breach of this Agreement by Recipient.
(b) Use of Confidential Information. Recipient shall receive and use the
Confidential Information only in connection with this License Agreement and
will not use Confidential Information for any other purpose, and shall not
disclose such Confidential Information to any person or persons who do not need
to have knowledge of such Confidential Information in the course of their
employment or contractor relationship with Recipient.
(c) Protection of Confidential Information. Both Parties agree to take
reasonably sufficient actions to safeguard and preserve the confidentiality
required by this License Agreement including at a minimum such measures as it
uses with its own comparable confidential information. Both Parties agree to
have each of their employees sign their own respective employee confidentiality
agreements which shall include terms sufficient to inform their employees of
their obligations under this Agreement.
(d) Return of Confidential Information. Upon termination of this Agreement,
upon request from the other Party, all Confidential Information and any copies
thereof shall be immediately returned by the Recipient to the other Party at
the other Party's expense, or shall be destroyed by the Recipient. Each Party
shall have the right to retain one copy for its legal files for the sole
purpose of demonstrating actions under this License Agreement.
11. Warranties. The Parties hereby agree and warrant, to the extent
applicable, as follows:
(a) Information provided by each Party to the other is provided "AS IS".
(b) Each party warrants that it is authorized to provide to the other the
information provided under the License Agreement, and that it is authorized to
enter into this License Agreement.
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(c) TRC warrants that to the best knowledge of TRC, neither the technology to
which Applica has access under the License Agreement, nor its manufacture, use,
sale or offer for sale, infringes on the intellectual property rights of any
third party.
(d) TRC warrants that to the best knowledge of TRC, there are no threatened or
pending lawsuits or other legal or administrative actions that would adversely
affect performance under this Agreement or that would reduce the value of the
rights granted hereunder.
(e) Except as provided in this section 11 and in paragraph 3(e) above, no
other warranties of any kind are provided by either party under the License
Agreement.
12. Offensive Litigation.
(a) Notice of Suspected Infringement. If either TRC or Applica have a good
faith suspicion that any TRC Patent, Applica Patent or Joint Patent is being
infringed, either directly, indirectly, contributorily or otherwise, by a third
party, the party possessing such suspicion shall promptly notify the other of
such suspicion of infringement and the basis therefore.
(b) Infringement of TRC Patents. TRC may in its sole discretion take action
to enforce any TRC Patent. Applica agrees to reasonably cooperate with TRC in
any such enforcement efforts by TRC. If TRC becomes involved in any
litigation, arbitration, mediation or other proceeding related to enforcement
of any TRC Patent, TRC agrees to bear the reasonable expenses incurred by
Applica associated with any such proceedings. TRC shall be entitled to all
amounts received from any third parties resulting from such enforcement efforts
by TRC.
If Applica provides TRC notice of suspected infringement of any TRC Patent, TRC
shall have 30 days from receipt of such notice to inform Applica that TRC will
take action to enforce such TRC Patent. If TRC fails to so inform Applica by
the end of such 30-day period, then Applica may in its sole discretion exercise
a right to take action to enforce such TRC Patent. TRC agrees to reasonably
cooperate with Applica in any such enforcement efforts by Applica. If Applica
becomes involved in any litigation, arbitration, mediation or other proceeding
related to enforcement of any TRC Patent, Applica agrees to bear the reasonable
expenses incurred by TRC associated with any such proceedings. Applica shall
be entitled to all amounts received from any third parties resulting from such
enforcement efforts by Applica.
13. TRC Patent Validity/Enforceability Challenges. The obligation to pay
royalties to TRC under this Agreement with respect to any TRC Patent shall
continue until the expiration of such TRC Patent, or termination of this
Agreement, whichever is later, except as follows: If a challenge in any
judicial or administrative forum to the validity or enforceability of any TRC
Patent results in an intial determination from which an appeal may be taken
that such TRC Patent is invalid or unenforceable, then beginning on the date of
such initial determination all royalty payments due based solely on such TRC
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Patent shall be made into an escrow account established by Applica for the
receipt of such payments, provided that in the event of a final determination
from which no appeal may be taken that such TRC Patent is invalid or
unenforceable, then all obligations to pay royalties under this Agreement with
respect to such TRC Patent shall end, and the amount held in such escrow
account shall be returned to Applica, and further provided that in the event of
a final determination from which no appeal may be taken that such TRC Patent is
not invalid or is not unenforceable, then all obligations to pay royalties
under this Agreement with respect to such TRC Patent shall continue, and the
amount held in such escrow account shall be paid to TRC.
14. Indemnification. TRC agrees to defend or at its option to settle any and
all claims, demands, suits or proceedings made or brought against Applica to
the extent based on a claim that technology provided by TRC, or its use,
infringes any patent, copyright, trade secret or other intellectual property
rights of any third party. In any such claim, demand, suit or proceeding for
which TRC assumes the defense or settlement, TRC shall pay or reimburse
Applica for any damages, costs, or expenses awarded against Applica or agreed
to by TRC as part of a settlement, to the extent based upon such a claim (plus
its reasonable attorneys' fees and costs) provided that Applica gives TRC
(i) prompt written notice of the claim and all material documentation, (ii) the
exclusive authority to defend or settle and control the defense, (iii) all
information relevant to the claim and reasonable assistance in defending or
settling any such claim, demand, suit or proceeding; and (iv) its cooperation,
including not making any admission or compromise. Applica will have the right
to participate in such defense or settlement negotiations at its expense, with
counsel of its own choosing.
15. Limitation of Liability. TO THE MAXIMUM EXTENT PERMITTED BY LAW, IN NO
EVENT WILL EITHER PARTY, OR EITHER PARTY'S OFFICERS, DIRECTORS, SHAREHOLDERS,
AFFILIATES, EMPLOYEES, INSURERS, ATTORNEYS, AGENTS, OR PERMITTED SUCCESSORS OR
ASSIGNS, BE HELD LIABLE, WHETHER IN CONTRACT, WARRANTY, TORT (INCLUDING
NEGLIGENCE OR BREACH OF STATUTORY DUTY), STRICT LIABILITY, INDEMNITY,
CONTRIBUTION, OR OTHERWISE, FOR ANY INDIRECT, SPECIAL, PUNITIVE, EXEMPLARY,
INCIDENTAL, OR CONSEQUENTIAL LOSS, DAMAGES, COST, OR EXPENSE OF ANY KIND
WHATSOEVER, HOWSOEVER CAUSED, OR FOR ANY LOSS OF PRODUCTION, LOSS OF CAPITAL,
LOSS OF SOFTWARE, 1NTERUPTION OR LOSS OF BUSINESS, ANY LOSS OF PROFIT, LOSS OF
REVENUES, CONTRACTS, BUSINESS, GOODWILL OR ANTICIPATED SAVINGS OR WASTED
MANAGEMENT TIME, EVEN IF ADVISED OF THE POSSIBILITY OR IT WOULD FORESEEABLY
ARISE FROM THE PERFORMANCE OF THIS AGREEMENT.
16. Publicity. The Parties acknowledge and agree that neither Party is
authorized to speak on behalf of the other. With respect to the general
subject matter to which the License Agreement is directed, TRC agrees that in
all third party communications TRC will not make any reference to Black &
▇▇▇▇▇▇; to any Applica current or future product plans; nor to any Applica
current or future marketing or sales plans; without the advance written consent
of Applica. Neither Applica nor TRC shall issue any press release related to
the subject matter of this License Agreement without the advance written
approval of the other.
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17. (a) Patent Marking. Applica agrees to place in a conspicuous location on
each Household Kitchen Appliance covered by a claim of a TRC Patent or a Joint
Patent, and sold in the United States, a patent notice in the form authorized
by 35 U.S.C. 287 setting forth the number of each such United States TRC
Patent or Joint Patent. Upon reasonable request from TRC, Applica will provide
a similar patent number notice on each Household Kitchen Appliance covered by a
claim of a TRC Patent or a Joint Patent, and sold outside the United States.
(b) Reference to TRC and the FIRE SHIELD(R) Trademark. For each product for
which a royalty is due TRC under this Agreement, Applica agrees that, in a
manner similar to that being employed by Applica on the Effective Date with
respect to certain heater products sold by or for Applica, Applica will
reference TRC' s FIRE SHIELD(R) trademark as being owned by TRC; provided, that
Applica shall not be obligated hereunder to make any such reference if The
Black & ▇▇▇▇▇▇ Company objects to use of that trademark in connection with a
Black & ▇▇▇▇▇▇ brand product, or if such trademark becomes abandoned or no
longer owned by TRC.
18. Other Provisions.
(a) Assignment. The rights and obligations of this License Agreement are not
assignable by either Party without the prior written approval of the other
Party, except pursuant to a merger, sale of all or substantially all assets or
other corporate reorganization, or to a wholly-owned subsidiary or other
Affiliate.
(b) Independent Contractors. No partnership, joint venture, agency, or other
such legal relationship is created between the Parties under this License
Agreement. The Parties' relationship will be that of independent contractors
at all times.
(c) Governing Law/Jurisdiction. This License Agreement shall be governed by
the laws of the State of Florida, excluding that body of law known as conflicts
of law. The parties shall negotiate in good faith to resolve any dispute that
arises between them relating to this License Agreement.
(d) Attorneys' Fees. The prevailing Party in any legal action arising out of,
or related to this License Agreement shall be entitled, in addition to any
other rights and remedies it may have, to reimbursement for its expenses
incurred in such action, including court costs and reasonable attorneys' fees.
(e) Notices. All notices or communications to be given under this Agreement
shall be in writing and shall be deemed delivered upon hand delivery; upon
acknowledged telex or facsimile communication; five days after deposit in the
United States mail, postage prepaid, by certified or registered mail; or by
overnight air courier or other express delivery service addressed to the
Parties at their addresses set forth above. A Party's address for notice may
be changed by notice pursuant to this paragraph 13(e).
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(f) Amendment. The terms and conditions of this License Agreement may not be
superseded, modified, or amended except in a writing which states that it is
such a modification, and is signed by officers or duly authorized
representatives of the Parties.
(g) Entire Agreement. This License Agreement constitutes the entire agreement
between the Parties as to the subject matter hereof, and supersedes and
replaces all prior or contemporaneous agreements, written or oral, regarding
such subject matter.
(h) Confidentiality of Agreement. Unless otherwise required by law or this
License Agreement, no public disclosure of the subject matter of this License
Agreement shall be made by either Party unless approved by the other, such
approval not to be unreasonably withheld, provided that the Parties shall be
entitled without such approval to make any disclosures required by law.
(i) Counterparts. This License Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all of
which together constitute one and the same agreement.
(j) Enforceability of Agreement Provisions. The illegality or
unenforceability of any provision of this License Agreement shall not affect
the enforceability of the remaining provisions of this License Agreement,
unless such illegal or unenforceable provision is an essential material part of
this License Agreement, in which case the Parties agree to negotiate in good
faith regarding modification of such illegal or unenforceable provision.
(k) Vicarious Performance Through Affiliates. Each Party hereunder may
perform any of its duties and obligations, or exercise any of its rights,
through any of its Affiliates, and performance by any Affiliate shall be deemed
to be performance by the respective Party. Any Affiliate performing any duty
or obligation or exercising any right shall conclusively be deemed to be bound
by the terms of this Agreement as if a signatory hereto. Each Party shall be
fully liable hereunder for breach of the terms of this Agreement by its
Affiliate(s).
(l) Patent Costs. TRC shall pay all fees, expenses, taxes, annuities,
maintenance fees and other costs associated with the preparation, filing,
prosecution, issuance, reexamination, reissue, and maintenance of all TRC
Patents and any TRC- owned Intellectual Property Rights to which this License
Agreement is generally directed. Applica shall pay all fees, expenses, taxes,
annuities, maintenance fees and other costs associated with the preparation,
filing, prosecution, issuance, reexamination, reissue, and maintenance of U.S.
Patent Application Serial No. 10/255,167.
Page 13
(m) Construction. Each Party has cooperated in the drafting of this
Agreement, and this Agreement shall not be construed against any Party on the
basis that the Party was the drafter. The headings are for convenience and are
not to be used in construing the meaning of any provision of this Agreement.
(n) Independent Legal Advice. The Parties acknowledge that they have been
advised, or have had the opportunity to be advised, by their own independently
selected counsel and other advisors in connection with this Agreement and that
they enter into this Agreement solely on the basis of that advice and on the
basis of their own independent investigation of all the facts, laws and
circumstances material to this Agreement or any provisions thereof, and not in
any manner or to any degree based upon any statement or omission by the other
Party and/or its counsel or representatives.
(o) Force Majeure. Neither Party shall be responsible for delays or failures
in performance resulting from acts beyond the control of the Parties,
including, without limitation, acts of God, strikes, lock-outs, riots, acts
of war or terrorism, epidemics, governmental regulations imposed after the
fact, fire, communication line failures, power failures, earthquakes or other
disasters.
IN WITNESS WHEREOF, the Parties hereto have executed this License Agreement
effective as of the Effective Date.
TECHNOLOGY RESEARCH CORP. APPLICA CONSUMER PRODUCTS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: President Title: V.P. Engineering
Page 14
EXHIBIT A
SAFETY CIRCUIT TECHT4OLOGY DESCRIPTION
The safety circuit technology as described in U.S. Patent Number 6,525,914
issued February 25, 2003 ("the '914 patent") (hereby incorporated by reference
herein), but specifically excluding any and all technologies not described in
the '914 patent that are described in other patents owned by TRC.
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EXHIBIT B
TRC FEE SCHEDULE
Upon mutual agreeable terms and written consent of the Parties, TRC is prepared
to offer Applica a TRC Project Engineer who shall be available to assist
Applica in the further development and manufacture of Household Kitchen
Appliances using the TRC Licensed Technology; and technicians, draftsmen, and
laboratory testing facilities, at the following rates:
Technicians: US$50 per hour
Draftsman: US$50 per hour
Lab Testing Facilities: US$500 per day
Design Engineering: US$150 per hour
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