AGREEMENT FOR ACQUISITION OF A PATENT APPLICATION
Exhibit
10.1
AGREEMENT
FOR ACQUISITION OF A PATENT APPLICATION
This
AGREEMENT FOR ACQUISITION OF A PATENT APPLICATION (the "Agreement") is entered
into as of 18th
day of
June 2007 (the "Effective Date") by and between OmniReliant Holdings, Inc.
a
Nevada corporation ("Buyer") and Product & Technology Partners LLC, a New
Jersey Limited Liability Company (“Seller”) with respect to the following
facts:
WHEREAS,
the Seller is the owner of certain patent applications and intellectual property
utilized in connection therewith, collectively referred to herein as the “Patent
Application, as described in Exhibit “B”;
WHEREAS,
Buyer wishes to purchase the Patent Application (as hereinafter defined) from
the Seller:
NOW,
THEREFORE, for good and valuable consideration, the receipt and legal
sufficiency of which is hereby acknowledged, the parties hereto covenant and
agree as follows:
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1.
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Definitions.
As used in this Agreement, the following terms shall have the following
meanings:
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The
“Product”
means
a
self-warming topical pharmaceutical product capable of delivering salicylic
acid
in a foam suitable for consumer use.
The
“Provisional
Application”
means
a
provisional patent application filed with the U.S. Patent and Trademark Office
on October 11 2006, having serial number
60/828984.
The
“Patent
Application”
means
a
patent application filed with the U.S. Patent and Trademark Office pursuant
to
Title 35 of the United States Code and Title 37 of the Code of Federal
Regulations on January 24, 2007, claiming priority of the Provisional
Application and having serial number 11/626551.
The
“PCT
Application”
means
a
patent application which may be filed under the Patent Cooperation Treaty
claiming priority of the provisional application.
The
“Non
PCT Application”
means
any patent application claiming priority of the provisional application filed
in
any jurisdiction not a member of the Patent cooperation Treaty or, if no PCT
application is filed, a patent application filed in any non-USA jurisdiction
pursuant to the Paris Convention for the Protection of Industrial Property
or
revisions thereof.
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2.
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Transfer
and Assignment.
The Seller hereby agrees to assign, transfer and convey to Buyer
all of
the Seller’s right title and interest in and to the Patent Application.
The Seller shall deliver an Assignment to perfect the transfer of
the
Patent Application in the form attached as Exhibit “A” (the “Assignment”).
In addition, the Seller shall assign, transfer and convey to Buyer
all of
the Seller’s right, title and interest in and to all Patents,
Patent Applications, PCT Applications and Non PCT Applications filed
by
Seller claiming priority of the Provisional Application.
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3.
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Consideration.
In consideration for the transfer and assignment of the Patent Application
to Buyer, Buyer agrees to the
following:
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d)
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Upon
execution of this Agreement, Buyer shall (i) pay to Seller an aggregate
of
Twenty Five Thousand dollars ($25,000), issue to the Seller Two Hundred
Thousand (200,000) shares of Buyer’s restricted common stock (the “Payment
Shares”), which Payment Shares shall be subject to the Lock-Up provision
set forth in Section 4(i)) herein, and (iii) make to the Seller up
to
$400,000 in installment payments, as hereinafter described. All payments
shall be due and payable as set forth in this Section 3.
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e)
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Buyer
shall conduct Due Diligence (“DD”) evaluations for a period of Six (6)
months from the date hereof. Following the DD period, if Buyer is
satisfied with the product and intends to offer product for sale,
Buyer
shall pay to Seller Twenty Five Thousand dollars ($25,000). Seller
shall
provide advice and expertise provided that Seller incurs no expenses.
Time
consulting will be at the discretion of the
Seller.
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f)
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Buyer
shall pay seller Installment Payments of Four Hundred Thousand Dollars
($400,000.), payable over a period of 4 years following six months
from
the date of this agreement. The payments will consist of 1% on wholesale
the first 12 months of airing the first infomercial and 3% thereafter.
Payments of 5% wholesale will be paid on product sold on HSN or QVS.
Payments will be paid in quarterly installments to the Seller. Installment
Payments shall not exceed an aggregate of Four Hundred Thousand Dollars
($400,000). If no revenues are generated from the sale of the Product,
no
Installment Payments shall be due
hereunder.
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4.
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Seller’s
Representations.
Seller represents as follows:
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a)
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Authority
and Consents.
The Seller has the right, power, legal capacity and authority to
enter
into and perform its obligations under this Agreement and no approvals
or
consents of any person or entity is necessary in connection therewith.
This Agreement, when executed and delivered, shall constitute a legal,
valid and binding obligation of the Seller enforceable against it
in
accordance with its terms.
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b)
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Title
to Patent Application.
The Seller has good and marketable title to the Patent Application.
To the
best of the Seller’s knowledge, the Patent Application is free and clear
of restrictions on or conditions to transfer or assignment, and is
free
and clear of mortgages, liens, pledges, charges, encumbrances, equities,
or claims of any kind or manner.
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c)
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Litigation;
Infringement Claims.
Seller hereby represents that as of the date of the signing of this
agreement, there are no actions, suits, proceedings, arbitrations,
investigations or claims pending or, to the knowledge of the Seller,
threatened against or affecting the Seller in connection with the
Patent
Application. To the best of Seller’s knowledge, the Patent Application and
related Intellectual Property do not infringe upon the intellectual
property rights of any other third party
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d)
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Information
on Buyer.
The Seller has been furnished with the Buyer's Form 10-QSB for the
quarter
ended March 31, 2007. as filed with the Securities and Exchange Commission
(the “Commission”) together with all subsequently filed forms 10-QSB, 8-K,
and other publicly available filings made with the Commission (hereinafter
referred to collectively as the "Reports"). In addition, the Seller
has
received from the Buyer such other information concerning its operations,
financial condition and other matters as the Seller has requested
in
writing (such information in writing is collectively, the "Other
Written
Information"), and considered all factors the Seller deems material
in
deciding on the advisability of investing in the
Securities.
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e)
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Information
on Seller.
Each member of Seller is an "accredited investor", as such term is
defined
in Regulation D promulgated by the Commission under the Securities
Act of
1933, as amended (the “1933 Act”), is experienced in investments and
business matters, has made investments of a speculative nature and
has
purchased securities of United States publicly-owned companies in
private
placements in the past and, with its representatives, has such knowledge
and experience in financial, tax and other business matters as to
enable
each member of the Seller to utilize the information made available
by the
Buyer to evaluate the merits and risks of and to make an informed
investment decision with respect to the proposed purchase, which
represents a speculative investment. Each member of the Seller has
the
authority and is duly and legally qualified to purchase and own the
Securities. Each member of the Seller is able to bear the risk of
such
investment for an indefinite period and to afford a complete loss
thereof.
The information set forth on the signature page hereto regarding
the
Seller is accurate.
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f)
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Purchase
of Common Stock.
The Seller will receive the Common Stock for its own account and
not with
a view to any distribution thereof to any parties or persons other
than
the members of Seller prior to the end of the Lock-up
period.
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g)
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Compliance
with Securities Act.
The Seller understands and agrees that the Securities have not been
registered under the 1933 Act, by reason of their issuance in a
transaction that does not require registration under the 1933 Act
(based
in part on the accuracy of the representations and warranties of
the
Seller contained herein), and that such Securities must be held,
for a
period of one (1) year, unless a subsequent disposition is registered
under the 1933 Act or is exempt from such
registration.
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h)
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Legend.
The Common Stock shall bear the following legend, unless same shall
have
been included in an effective registration statement under the 1933
Act:
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"THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. THESE SHARES MAY NOT BE SOLD, OFFERED FOR
SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH SECURITIES ACT OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO OMNIRELIANT HOLDINGS, INC. THAT SUCH REGISTRATION IS NOT
REQUIRED."
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i)
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Lock
Up.
For a period commencing on the date of issuance of the Payment Shares
and
expiring twenty-four (24) months thereafter,the Seller shall not
directly
or indirectly, agree or offer to sell, sell, grant an option for
the
purchase or sale of, transfer, pledge, assign, hypothecate, distribute
or
otherwise encumber or dispose of the Payment
Shares.
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j)
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Intellectual
Property Counsel.
Buyer shall engage, at its own expense, the services of intellectual
property counsel selected by Seller to pursue the prosecution of
the
patent application, including the filing and prosecution of any and
all
continuation, continuation in part or divisional applications thereof,
as
well as the filing of PCT and Non PCT applications. All costs
of intellectual property counsel and those
of associated foreign counsel including
but not limited to the
filing of PCT and Non PCT applications shall be at the expense of
Buyer.
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5.
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Buyer's
Representations and Warranties.
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a)
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Buyer
is a corporation duly organized, existing and in good standing under
the
laws of the State of Nevada. The Buyer has the right, power, legal
capacity and authority to enter into and perform its obligations
under
this Agreement and no approvals or consents of any person or entity
is
necessary in connection therewith. This Agreement, when executed
and
delivered, shall constitute a legal, valid and binding obligation
of the
Buyer enforceable against it in accordance with its
terms.
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b)
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Buyer
shall use its best efforts to commercialize the Product, including
obtaining necessary regulatory
approvals.
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6.
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Indemnification.
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a)
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Buyer
or its vendees, mediate or immediate will assume the defense of any
suit
brought against Seller, for infringement of any U.S. patent or for
wrongful use of proprietary information of any third party insofar
as such
suit is based on a claim that the infringement or wrongful use is
attributable to Buyers use, manufacture, sale or other disposition
of the
Product and corresponding proprietary information supplied under
this
Agreement. In any such suit, Buyer will indemnify Seller against
any money
damages or costs awarded in such suit in respect to such a
claim.
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b)
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Buyer
or its vendees, mediate or immediate will hold harmless Seller for
any
claims against Seller arising from any product liability lawsuits
attributable to Buyers use, manufacture, sale or other disposition
of the
Product and corresponding proprietary information supplied under
this
Agreement.
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c)
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Entire
Agreement; Modification.
This
Agreement and the exhibits referenced herein constitute the entire
agreement between the parties pertaining to the subject matter contained
in it and supersedes all prior and contemporaneous agreements,
representations and understandings of the parties. No supplement,
modification or amendment of this Agreement shall be binding unless
executed in writing by all the
parties.
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d)
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Notices.
All notices, requests, demands and other communications under this
Agreement shall be in writing and shall be deemed to have been duly
given
on the date of service if served personally on the party to whom
notice is
to be given, or on the fifth (5th) day after mailing if mailed to
the
party to whom notice is to be given, by first class mail, registered
or
certified, postage prepaid and property addressed as
follows:
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| To Seller: |
Product
& Technology Partners, LLC
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▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Tel:
(▇▇▇) ▇▇▇-▇▇▇▇
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
| To Buyer: |
▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇,
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▇▇▇▇▇
Tel:
(▇▇▇) ▇▇▇-▇▇▇▇
Fax:
(813) _______
| Copies to: |
▇▇▇▇▇▇
▇▇▇▇▇▇, Esq.
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Sichenzia
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP
▇▇
▇▇▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇ ▇▇▇▇▇
Tel:
(▇▇▇) ▇▇▇-▇▇▇▇
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
Any
party
may change its address for purposes of this paragraph by giving the other
parties written notice of the new address in the manner set forth
above.
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e)
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Payment
of Expenses and Construction.
Each party to this Agreement shall be responsible for, and shall
pay, all
of its own fees and expenses, including those of its counsel, incurred
in
the negotiation, preparation and consummation of this Agreement and
the
transactions described herein. The parties to this Agreement are
represented by counsel. This Agreement, and related agreements executed
in
connection with this Agreement, shall not be construed against any
party
on the basis that such party or its agents drafted parts of, or the
entirety of such documents.
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f)
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Severability.
If any provision of this Agreement is held invalid or unenforceable
by any
court of final jurisdiction, it is the intent of the parties that
all
other provisions of this Agreement be construed to remain fully valid,
enforceable and binding on the parties.
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g)
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Binding
Effect.
This Agreement shall bind and inure to the benefit of each party
hereto
and their respective successors, heirs and
assigns.
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h)
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Counterparts.
This Agreement may be executed simultaneously in one or more counterparts,
each of which shall be deemed an original, but all of which together
shall
constitute one and the same instrument. This Agreement may be executed
by
facsimile, with originals to follow by overnight
courier.
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i)
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Governing
Law.
This Agreement shall be construed in accordance with, and governed
by, the
internal laws of the State of New York.
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j)
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Incorporation.
All exhibits hereto are incorporated in whole by this
reference.
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Authority
of Parties.
Each party signing this agreement on behalf of another person or
entity
warrants to the other parties that he or she is fully authorized
to do so,
and that his or her signing of the agreement will bind the party
for whom
he or she is signing to the terms of.
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IN
WITNESS WHEREOF, the parties have executed this Agreement for Acquisition of
Patent Application as of the date first written above.
| Seller: |
PRODUCT
& TECHNOLOGY PARTNERS, LLC.
By:
_________________________________
Name:
Title:
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Buyer:
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By:
_________________________________
Name:
Title:
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EXHIBIT
A
ASSIGNMENT
WHEREAS,
Product and Technology Partners, LLC a New Jersey Limited Liability Company,
(the "Seller” or “Assignor”) is the owner of the Patent Application set forth in
Exhibit “B” hereto.
WHEREAS,
OmniReliant Holdings, Inc. ("OMNIRELIANT" or “Assignee”) has entered into that
certain Agreement for Acquisition of Patent Application dated as of June __,
2007 (the "Agreement") and incorporated in whole by this reference;
WHEREAS,
Assignor desires to assign all of its rights, title and interest in the Patent
Application
NOW,
THEREFORE, TO ALL WHOM IT MAY CONCERN:
Be
it
known that for good and valuable consideration, the receipt and sufficiency
of
which is hereby acknowledged, the aforesaid Assignors have sold, assigned and
transferred, and by these presents does hereby sell, assign and transfer unto
OMNIRELIANT the full and exclusive right, title and interest in and to the
Patent Application in the United States of America and in its colonies,
territories and dependencies and also in all countries foreign to the United
States of America, the same to be held and enjoyed irrevocably by OMNIRELIANT
for its own use, and for the use of its successors, assigns or other legal
representatives.
Assignor
hereby represents that it has not heretofore transferred, assigned or otherwise
conveyed any interest in the Patent Application to any third party in any manner
whatsoever.
Assignor
covenants to execute all additional instruments and do all things necessary
for
carrying out the purpose of this instrument, including, without limitation,
execution of all documents or instruments necessary to apply for a patent or
patents directly in the name of OMNIRELIANT.
OMNIRELIANT
accepts the assignment of all the rights, titles, and interest in and to the
Patent Application
This
Assignment shall be effective for all purposes as of June __, 2007.
All
defined terms utilized in this Assignment shall have the meanings ascribed
to
them in the Agreement unless otherwise indicated.
]
IN
WITNESS WHEREOF, the Assignor has caused this Assignment to be signed this
__
day of June, 2007.
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PRODUCT
& TECHNOLOGY PARTNERS, LLC.
By:
_________________________________
Name:
Title:
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| STATE OF |
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ss.
| County of |
)
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On
__________________ before me, _________________________, Notary Public,
personally appeared _____________________________________ personally known
to
me, or proved to me on the basis of satisfactory evidence to be the person
whose
name is subscribed to the within instrument and acknowledged to me that he
executed the same in his authorized capacity and that by his signature on the
instrument the person or the entity upon behalf of which the person acted,
executed the instrument.
WITNESS
my hand and official seal.
Notary
Public _________________________________