EXHIBIT 10.4
TECHNOLOGY LICENSING AGREEMENT
THIS AGREEMENT ("The Agreement") is made this _____ day of December,
1999, by and between Chequemate International, Inc., a corporation organized
and existing under the laws of the State of Utah, one of the United States of
America, d/b/a C3D Digital, Inc., ("Licensor"), having its principal place of
business at 000 Xxxxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxx xxx Xxx, Xxxxxxxxxx
00000, and Xxxxx Xxxxxxxx, an individual residing at 00000 Xxxxx Xxxxxxxxx
Xxxxx, Xxxxx, Xxxx 00000, ("Licensee").
WHEREAS, Licensor is the owner of certain intellectual property and
technology (the "Know-how") relating to the conversion of two dimensional
imagery to pseudo-stereoscopic imagery, as incorporated in a consumer product
known as a "Realeyes" unit, previously manufactured by Circuit Technology
Corporation, and
WHEREAS, Licensee desires to obtain a nonexclusive license to use
the Know-how, and Licensor desires to grant this license to Licensee on terms
and conditions acceptable to the parties; and
WHEREAS, the quality of the goods manufactured by the Licensee
pursuant to this Agreement and the maintenance of the Know-how in confidence
are material conditions of this Agreement and Licensor's grant of the license
contained in this Agreement;
NOW, THEREFORE, in consideration of the mutual promises contained
herein and intending to be legally bound hereby, Licensor and Licensee agree
as follows:
1 GRANT OF RIGHTS. Licensor grants Licensee the nonexclusive license to
manufacture, use, and sell Realeyes units, using and incorporating the
Know-how, subject to the terms and conditions set forth in this Agreement.
Nothing in this Agreement should be construed to prohibit the granting of
other or similar licenses to any person or entity, or to prohibit the
Licensor from manufacturing, using, or selling products incorporating the
Know-how. In the event that Licensor develops or discovers modifications to
or improvement in the technology embodied in the Know-how that it deems in
its sole discretion to be useful to the Licensee's use of the rights granted
by this Paragraph 1 (the "Improvements"), Licensor must promptly disclose the
Improvements to Licensee in writing and offer a license to use the
Improvements upon the terms and conditions set forth in this Agreement.
2 GRANT-BACK TO LICENSOR. Licensee grants to Licensor a nonexclusive
royalty-free license to use any modification of or improvement to, any
technology used by Licensee pursuant to this Agreement and promptly to
disclose all such modifications and improvements to Licensor.
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3 WARRANTIES BY LICENSOR. Licensor warrants and represents that it is the
sole owner of the intellectual property, and that the practice of the art
disclosed in the intellectual property will not constitute an infringement of
the rights of any third party. Licensor indemnifies Licensee against and
holds Licensee harmless from any loss, damage, or claim, including reasonable
attorney fees, arising from or relating to any breach of the warranties
contained in this Paragraph 3. Licensor reserves the right to control the
defense of any resulting suit or claim, including without limitation the
right to choose counsel and to settle and dispose of the suit or claim as it
deems appropriate in its sole discretion.
4 ROYALTIES. As and for full consideration for the rights granted in this
Agreement, Licensee will pay to the Licensor the following:
a. Initial Payment. Licensee will pay to Licensor One Hundred
Twenty Five Thousand Dollars ($125,000.00) upon execution of
this Agreement.
b. Additional Royalties. Licensee will pay to Licensor on the
first day of each month during any term of this Agreement a
sum equal to $3.00 for each Realeyes unit sold by Licensee
during the preceding month.
c. Access to Records. Licensee will maintain records of (1) the
manufacture, lease, sale or other disposition of all goods
and articles manufactured pursuant to this Agreement. These
records must be accurately maintained and conform to all
generally accepted accounting standards. Licensee will permit
access by Licensor to all these records during normal
business hours. In the event that Licensor discovers that the
records have not been maintained or are not accurate or that
Licensee has failed to make any payment of any royalties
required by the Agreement as shown by the records, Licensee
shall reimburse Licensor for the cost of reviewing the
records, including reimbursement of all reasonable accountant
and attorney fees.
5 SUB-LICENSE. Licensee may not grant any sub-license of any of the rights
granted by this Agreement without the prior written permission of Licensor.
6 CONFIDENTIALITY. Licensee acknowledges and agrees that all Know-how and
other manufacturing, sales, marketing, technical, and other information
disclosed to it by Licensor is confidential and proprietary to Licensor (the
"Confidential Information") and acknowledges that the unauthorized disclosure
of any of the Confidential Information will result in immediate and
irreparable competitive injury to Licensor. Licensee may disclose the
Confidential Information only to those of its employees to whom such
disclosure is necessary to permit the manufacture, use, and sale of the
products which incorporate the Know-how and may not disclose any of the
Confidential Information to any other person or entity without the prior
written approval of Licensor.
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7 QUALITY. All goods manufactured, sold, or otherwise disposed of by
Licensee pursuant to this Agreement must meet reasonable quality standards as
imposed by Licensor. Licensee will permit Licensor access to its
manufacturing facilities during normal working hours for the purpose of
ensuring that Licensee's manufacturing practices conform to the requirements
of this Paragraph 7.
8 NON-COMPETITION. Licensee may not during any term of this Agreement
engage in the manufacture, use, or sale of any goods or articles that compete
with or have a similar use or application as the goods manufactured pursuant
to this Agreement.
9 TECHNICAL ASSISTANCE. Licensor will provide, at Licensee's sole expense,
sufficient technical assistance to enable Licensee to manufacture the
products incorporating the Know-how.
10 INFRINGEMENT. In the event that Licensee becomes aware of any act that
may constitute an infringement of any right granted by this Agreement,
Licensee must promptly notify Licensor of that act. Thereafter, Licensee
will, at Licensor's expense, assist Licensor in the prosecution of any claim
or action arising from or relating to that act, provided that Licensee must
bear all attorney fees and expenses incurred as a result of Licensee's use of
counsel other than or in addition to counsel retained by Licensor.
11 TERM AND TERMINATION. The term of this License shall be perpetual,
unless Licensee materially breaches any of his obligations hereunder, and
fails to cure such breach within thirty days of written notice thereof. In
the event that a material breach remains uncured after such thirty day
period, this License shall be terminated.
12 ARBITRATION. All disputes arising from or relating to this Agreement or
its breach are to be finally decided by arbitration conducted under the rules
of the American Arbitration Association, governing commercial disputes.
13 ASSIGNMENT. Licensee may not assign this Agreement or any right granted
herein without the prior written consent of Licensor.
14 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between Licensor and Licensee with regard to its subject matter, and no
prior, simultaneous, or collateral promises or representations not expressly
contained in this Agreement are of any force or effect.
15 TAXES, EXPENSES, COMPLIANCE WITH LAW. Licensee will pay and discharge or
cause to be paid and discharged as and when they become due all taxes,
levies, assessments, governmental charges, fines and penalties of whatsoever
nature lawfully imposed in connection with its activities under this
Agreement and any income derived from this Agreement.
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16 APPLICABLE LAW. This Agreement is governed by and construed under the
laws of the State of California, applicable to contracts executed or
performed in California.
19 BOARD OF DIRECTORS APPROVAL. This Agreement is subject to the approval
of the Licensor's Board of Directors, which approval shall be promptly sought
by the officer whose signature appears below.
CHEQUEMATE INTERNATIONAL, INC.
By:
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J. Xxxxxxx Xxxx, CEO
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Xxxxx Xxxxxxxx
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