EXCLUSIVE LICENSE AGREEMENT
THIS EXCLUSIVE LICENSE AGREEMENT is entered into this 10th day of October,
1997 at Newport Beach, California, by and between CardTech, Inc., a Nevada
corporation ("Licensor") and UltraCard, Inc., a Nevada corporation ("Licensee")
with reference to the following facts:
Acknowledgments
---------------
1. The parties hereto acknowledge that:
(a) CardTech holds the rights to technology and know-how concerning
card-based storage media and read/write systems covered by U.S.
Patents Nos. 4,742,410 issued May 3, 1988, and 5,107,099 issued
April 21, 1992, and related foreign patents applied for under the
Patent Cooperation Treaty, and CardTech is presently supervising,
guiding and assisting in the preparation of additional patent
application(s) based upon and incorporating the technology
licensed hereby (hereinafter "CardTech Technology").
(b) UltraCard desires to develop and exploit the CardTech Technology
and to hold and exploit the license granted hereunder with
respect to both the presently issued patent and all future patent
rights resulting from the filing of application(s) for additional
patent(s) relating to said technology, whether such patent
application(s) are presently in preparation, or may be prepared
and filed in the future.
(c) CardTech has agreed to grant to UltraCard an exclusive worldwide
license to use the CardTech Technology, to manufacture, assemble,
market and sell products based upon or incorporating the CardTech
Technology.
Grant of Licens
------------------
2. CardTech hereby grants to UltraCard an exclusive world-wide license
(the "License") to use the CardTech Technology and to manufacture,
assemble, market and sell products based upon or incorporating the
CardTech Technology, subject to the terms and conditions in this
Agreement.
3. CardTech further grants to UltraCard the right to use the trademarks,
patents, trade names, product descriptions and public information
pertaining to the CardTech Technology and any products or services
which may become components or parts of products based on or using the
CardTech Technology.
4. CardTech further grants to UltraCard the right to make such alterations,
modifications and enhancements ("Design Improvements") to the CardTech
Technology as may be desired, and any such Design Improvements shall be and
shall remain the sole property of CardTech subject only to the License
granted pursuant to this Agreement.
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5. CardTech further agrees to take all necessary steps to guide and direct the
preparation of additional patent application(s) relating to the CardTech
Technology.
6. CardTech shall not compete with UltraCard in the production,
marketing, or sale of products based upon or incorporating the
CardTech Technology.
Sub-Licenses and Assignments
------------------------------
7. UltraCard may sub-license or assign all or any part of the License
with the prior written consent of CardTech which consent shall not be
reasonably withheld, provided that:
(a) If the sub-licensee or assignee is a company controlled by
UltraCard, CardTech's consent shall not be required so long as it
is a condition of such sub-license or assignment that the
sub-licensee or assignee shall execute an agreement acceptable to
CardTech under which the sub-licensee or assignee becomes a party
to this Agreement and agrees to be bound by all of the terms and
conditions hereof;
(b) No sub-license or assignment shall relieve UltraCard of any other
obligations hereunder;
(c) CardTech shall receive Thirty Percent (30%) of any sub-licensing
fees paid to UltraCard, payable within Seven (7) Days after
receipt of such fees by UltraCard;
(d) CardTech shall receive a payment of Twelve and One Half Percent
(12.5%) Of the first Ten Million Dollars ($10,000,000) of capital
invested in UltraCard, and shall receive Five Percent (5%) of all
additional capital invested in UltraCard, said payments to
CardTech to be made within Seven (7) Days after each investment
payment is received by UltraCard.
Term
----
8. The term ("term") of the License shall commence upon the date first
above written and shall expire upon the expiration of the term of the
last licensed patent to expire.
License Fee
------------
9. UltraCard, shall pay an initial fee ("License Fee") to CardTech, as
follows:
(a) Two Million Five Hundred Thousand (2,500,000) shares of the
common stock of UltraCard, fully paid and non-assessable, at the
date of Closing (defined below);
(b) $15,000 payable at the date of Closing (defined below);
(c) $15,000 payable within six (6) months after the date of Closing
(defined below)
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[page missing in hard copy]
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Representations and Warranties of CardTech
----------------------------------------------
15. CardTech represents and warrants to UltraCard as representations and
warranties that are true as of the date of Closing (or such other date
specified) that:
(a) CardTech has full power and authority to enter into and deliver this
Agreement and to complete the transactions contemplated hereby and
will not be in breach of or default under any other commitment or
obligation by which it is bound;
(b) No consents, authorizations or permits are required which have not
been obtained;
(c) CardTech holds all right, title and interest in and to the CardTech
Technology free and clear of any encumbrance; and
(d) No litigation, arbitration or administrative or other proceeding is
presently in process, pending or threatened against CardTech in
connection with or relating to the CardTech Technology.
Representations and Warranties of UltraCard
-----------------------------------------------
16. UltraCard represents and warrants to CardTech as representations and
warranties that are true as of the date hereof that UltraCard has the full
power and capacity to enter into and deliver this agreement and to complete
the transactions contemplated hereby and will not be in breach of or in
default under any other commitment or obligation by which UltraCard is
bound.
Termination of License
------------------------
17. The License shall terminate:
(a) Immediately upon UltraCard becoming insolvent or bankrupt or subject
of a petition in bankruptcy;
(b) In the event UltraCard fails to pay any portion of the License Fee
which is due or any portion of the Royalty Fee, all as required
herein, thirty (30) days after delivery of notice by CardTech to
UltraCard specifying such default, in which case the License shall
immediately become non-exclusive unless UltraCard shall have within
such thirty (30) day period made such payment as required or cured
such default or breach.
(c) In the event UltraCard fails to pay any portion of the Royalty Fee,
all as required herein, or defaults under or is in breach of any
obligation hereunder, ninety (90) days after delivery of notice by
CardTech to UltraCard specifying such default, the License shall
immediately terminate unless UltraCard has within such ninety (90) day
period made such payment as required or cured such default or breach.
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18. If the License is terminated:
(a) All rights of UltraCard hereunder shall immediately end;
(b) UltraCard shall immediately cease to use the CardTech Technology and
trademarks; and
(c) UltraCard shall promptly return to CardTech all manuals, programs,
printed matter, literature and other documentation in UltraCard's
possession or control relating to the CardTech Technology.
19. Closing of the transactions contemplated herein ("Closing") will occur
concurrent with the date of execution of this agreement.
Confidentiality
---------------
20. Neither of the parties hereto shall disclose to any person not a party to
this Agreement any information relating to the CardTech Technology that is
confidential or designated as confidential by either of the parties hereto
without the prior written consent of the other party hereto, and both
parties shall cause each of their employees and affiliates who have reason
to have access to the CardTech Technology and related documentation to
execute appropriate confidential information and non-disclosure agreements
and to otherwise protect the respective confidential information and
non-disclosure agreements and to otherwise protect the respective existing,
contemplated, and ongoing interests of the parties hereto to the CardTech
Technology.
Indemnities and Infringement
------------------------------
21. The parties hereto indemnify each other as follows:
(a) UltraCard agrees that CardTech shall not be liable to UltraCard for
any product liability claims, or loss, damage or expense arising
therefrom, whether caused directly or indirectly by the inadequacy of
the CardTech Technology for any purpose or by any deficiency or defect
therein or any interruption or loss or service or use of the CardTech
Technology or any loss of business by UltraCard or end-users that may
arise as a result of UltraCard's use of the CardTech Technology or
sale of products based upon or containing the CardTech Technology.
UltraCard shall defend, indemnify and hold CardTech harmless against
any such product liability claims or losses, damages or expenses or
actions in respect thereof or related thereto.
(b) CardTech shall indemnify UltraCard against all damages and cost
payable by UltraCard as a result of any claim that UltraCard's use of
the CardTech Technology has infringed any copyright, patent right or
other proprietary right. However, except as expressly set forth
herein, CardTech shall have no liability with respect to any other
industrial or intellectual property right whatsoever and UltraCard's
indemnity shall not apply to any of the following:
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(1) Claims in relation to products which do not relate to the
CardTech Technology; and
(2) Any combination of the CardTech Technology with other programs,
products or trademarks, where an infringement would not have
arisen in the absence of such combination.
Notices
-------
22. Any notice to be given pursuant to this Agreement by either party to the
other must be in writing and may be delivered or mailed by prepaid
registered mail to such address as is specified by the particular party by
notice to the other. Any notice sent as aforesaid shall be deemed to have
been given and received at the time of delivery and any notice mailed as
aforesaid shall be deemed to have been given on the date of the receipt.
Arbitration
-----------
23. The parties hereto agree that any disputes arising out of this Agreement
shall be finally settled by arbitration and such arbitration shall be a
condition precedent to the commencement of any action at law. The sole
exception to arbitration shall be any matter involving the interpretation
or enforceability of any trademarks, patents, copyrights or other
proprietary matters.
Binding Effect
---------------
24. Upon execution of this Agreement and payment of the License Fee in
accordance with the provisions of Section 9 hereof, the terms and
provisions herein contained will be and are intended to be binding upon the
parties hereto and shall be specifically enforceable in accordance with the
terms of this Agreement
Further Assurances
-------------------
25. The parties hereto agree to perform or cause to be performed all such acts
and deeds as may be required to give full force and effect to the terms and
provisions set out herein and to cooperate with each other and each other's
counsel in the preparation, execution and delivery of any and all documents
or instruments necessary to give full force and effect to the terms and
provisions set out herein.
Currency
--------
26. Reference to dollars ($) in this Agreement shall mean United States dollars
(U.S. $).
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November 7, 1998
Ms. Celeste Sim
UltraCard, Inc
5001 Birch St.
New Port Beach. CA
Dear Ms. Sim,
Pursuant to our recent discussions regarding the exclusive license Agreement
dated October 10, 1997 between CardTech, Inc. and UltraCard, Inc the following
changes have been agreed to and accepted by all of the parties:
1. Section 7. a. b. & c are hereby waived.
2. Section 7 d. is changed to reflect a maximum amount paid to CardTech of
no more than million dollars ($3,000,000). To be paid at a pro rata
rate of 12.5% of capital invested into UltraCard, Inc.
3. Section 9.a.b & c. are fully satisfied.
4. Section 11 is modified to allow the first year royalty to be paid as
follows: Seventy-five thousand dollars($75,000) due on or before
November 9, 1998; and two hundred twenty, five thousand dollars
($225,000) due on or before January 11, 1999
5. Section 14. B. is waived.
All other terms and conditions of the agreement remain in full force and effect.
Very truly yours,
/s/ XXX, President
----------------------------
CardTech, Inc.
Cc: Mr. Daniel Bland
Upgrade International Corp
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November 7, 1998
Mr. Daniel S. Bland
Upgrade International Corp
Ste. 101-435 Martin St.
Blaine, WA
Dear Mr. Bland,
Pursuant to our recent discussions regarding the exclusive license Agreement
dated October 10, 1997 between CardTech, Inc. and UltraCard, Inc the following
changes have been agreed to and accepted by all of the parties:
1. Section 7. a. b. & c are hereby waived.
2. Section 7 d. is changed to reflect a maximum amount paid to CardTech of no
more than million dollars ($3,000,000). To be paid at a pro rata rate of
12.5% of capital invested into UltraCard, Inc.
3. Section 9.a.b & c. are fully satisfied.
4. Section 11 is modified to allow the first year royalty to be paid as
follows: Seventy-five thousand dollars($75,000) due on or before November
9, 1998; and two hundred twenty five thousand dollars ($225,000) due on or
before January 11, 1999
5. Section 14: B. is waived.
All other terms and conditions of the agreement remain in full force and effect.
Please acknowledge by signing below if you are in agreement with these points.
Very truly yours,
XXX, President
-------------------------
UltraCard, Inc.
Acknowledged and agreed to this 7th day of November 98
/s/ Daniel S. Bland, President
----------------------------------
Upgrade International Corp
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November 7, 1998
Mr. Daniel S. Bland
Upgrade International Corp
Ste. 1010-435 Martin St.
Blaine, WA
Dear Mr. Bland,
Pursuant to our recent discussions regarding the issuance of an exclusive
distribution license to Global CyberSystems, SA a Suisse Corporation for Europe,
dated November 7, 1998 with a copy attached and incorporated herein, the
following represents the salient points of our agreement:
1. UltraCard, Inc and Upgrade International Corp. each own fifty percent (50)
of the stock as bearer shares of Global CyberSystems, SA.
2. Global CyberSystems, SA shall proceed with an Initial public offering (IPO)
on the Nouveau Marche, Paris, France at its earliest opportunity.
3. The IPO shall offer twenty five percent (25%) of its stock for Seventy
million dollars ($70,000,000.00) leaving respective shares to each party,
at thirty seven and one half percent (37.5%) to each Upgrade and UltraCard
or assigns.
Please acknowledge by signing below if you are in agreement with these points.
Very truly yours,
/s/ XXX, President
--------------------
UltraCard, Inc.
/s/ Daniel S. Bland, President
----------------------------------
Upgrade International Corp
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