SAMPLE FORM

LICENSE

 OF U.S. PATENT      1     ¹               

            This agreement, entered into as of this       21st      day of     April      , 2005², by and between
                        Tony Carter, Inc.         ³, a corporation of                    Idaho           ⁴ (state) with offices at                       40 Cobler St. SE, Kwit, ID 83406              ⁵, hereinafter referred to as LICENSOR, and             Timothy Walters, Inc.              ⁶, a corporation of             Missouri    ⁷ (state) with offices at     4450 20th St. SW, St. Louis,    MO  63141    ⁸, hereinafter referred to as LICENSEE.

Recitals

WHEREAS, LICENSOR is the owner of certain PATENT RIGHTS (hereinafter defined) covering DEVICES (hereinafter defined).

WHEREAS, LICENSEE is a manufacturer of various equipment and desires to manufacture and sell DEVICES.

WHEREAS, LICENSEE would like to receive and LICENSOR is willing to grant a non‑exclusive license under the PATENT RIGHTS.

NOW, THEREFORE, in consideration of the promises and mutual covenants hereinafter contained, the parties hereto agree as follows:

                                                                    ARTICLE I

                                                                  DEFINITIONS

1.1        PATENT RIGHTS shall mean U.S. Patent No.      1     ⁹ (hereinafter referred to as the "SUBJECT PATENT"), any corresponding patents or patent applications filed in other countries, any reissue applications, continuation application, and continuation-in-part applications filed thereon in the United States or any foreign country and any patents issuing thereon.

1.2        DEVICES shall mean any apparatus sold by LICENSEE that is covered by any of the claims of the PATENT RIGHTS.

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Copyright ©1994 - 2024 by LAWCHEK, LTD.

1.3        NET SALES PRICE shall mean the price at which a DEVICE is invoiced in an arms length transaction, less any royalties hereunder, discounts, sales taxes, excise taxes, or freight charges which are included in such invoice price.

1.4        EFFECTIVE DATE shall mean the date upon which the last of the parties hereto signs this LICENSE.

1.5        TERM shall mean the period from the EFFECTIVE DATE to either the date of cancellation by one of the parties under ARTICLE V hereof or the latest expiration date of the SUBJECT PATENT or any reissue, continuation, or continuation-in-part thereof, whichever occurs first. 

1.6        AFFILIATE shall mean any entity that is controlled by LICENSEE through ownership of at least 50% of the voting stock of such entity.

                                                                    ARTICLE II

                                                                       GRANT

2.1        LICENSOR hereby grants to LICENSEE and its AFFILIATES an irrevocable, worldwide, non-exclusive license during the TERM to make, have made, use, lease and sell DEVICES, and components and parts therefor, under the PATENT RIGHTS.

2.2        LICENSOR and LICENSEE understand and agree that LICENSEE receives no licenses or rights whatsoever, by implication or otherwise, under any other patents or applications owned or controlled by LICENSOR, except those specifically granted to LICENSEE by the terms of this LICENSE.

2.3        This LICENSE shall be binding upon and shall inure to the benefit of any corporation, company or entity into which either LICENSOR or LICENSEE may be merged or consolidated and the rights and obligations of the parties shall be assignable to any purchaser of that part of the assets of such party to which this LICENSE relates.

2.4        In the event LICENSOR grants another license under the PATENT RIGHTS on more favorable terms than those set forth in this LICENSE, LICENSEE may elect to include such more favorable terms herein, provided that LICENSEE also includes any terms from such other license that are less favorable than those herein.

2.5        LICENSEE agrees for itself and its AFFILIATES that no sublicenses shall be granted to any third party under the PATENT RIGHTS, except to the extent that licenses are implied with the sale of DEVICES under the Uniform Commercial Code.

                                                                   ARTICLE III

                                                              CONSIDERATION

3.1        Within   thirty     (  30  )¹⁰ days after the EFFECTIVE DATE, LICENSEE shall pay to

            LICENSOR the sum of                      two thousand dollars                      ($2000)¹¹.

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Copyright ©1994 - 2024 by LAWCHEK, LTD.

3.2        During the TERM, LICENSEE shall pay to LICENSOR a royalty of            50         ¹² percent

            (    50  %)¹³ of the NET SALES PRICE of all DEVICES sold by LICENSEE.

3.3        Each calendar quarter after the EFFECTIVE DATE there shall be an accounting period (a fractional initial or terminal period to be regarded as an accounting period) and

            LICENSEE shall within         thirty         (   30  )¹⁴ days after the end of each and every such accounting period, report in writing to LICENSOR the total number of DEVICES sold by LICENSEE during such accounting period.  Each such report shall also include the total NET SELLING PRICE of the DEVICES.  LICENSEE shall send to LICENSOR with each such report a check to the order of LICENSOR in U.S. Dollars in payment of the amount, if any, due to LICENSOR under this LICENSE, for said accounting period.

3.4        LICENSOR hereby releases LICENSEE for any infringement of the PATENT RIGHTS that may have arisen before the EFFECTIVE DATE of this LICENSE.

                                                                   ARTICLE IV

                                                                 WARRANTIES

4.1        LICENSOR warrants that it is the owner of the entire right, title and interest in the PATENT RIGHTS.

4.2        LICENSOR warrants that it has the sole right to grant licenses under the PATENT RIGHTS and has not heretofore granted any rights thereunder which would interfere with any rights granted LICENSEE under this LICENSE.

4.3        LICENSOR warrants that it agrees to prosecute all substantial claims of infringement of the PATENT RIGHTS at its own expense.

                                                                    ARTICLE V

                                                    RIGHTS OF CANCELLATION

5.1        In the event LICENSEE defaults in making a payment or report hereunder, or shall commit any other breach of covenant herein contained, LICENSOR may, at its option, cancel and terminate LICENSE and rights under PATENT RIGHTS, by giving LICENSEE  sixty ( 60 )¹⁵ days written notice.  Provided, however, that if LICENSEE shall correct the default within  thirty ( 30 )¹⁶ days after such notice, then said notice shall cease to be operative and this LICENSE shall continue in full force and effect as if such default had not occurred.  Cancellation of this LICENSE under this Article shall not prejudice the right of LICENSOR to recover any sum due it at the time such cancellation becomes effective and shall not prejudice any cause of action or claim of LICENSOR accrued or to accrue on account of any breach or default by LICENSEE.

This is not a substitute for legal advice.  An attorney must be consulted.
Copyright ©1994 - 2024 by LAWCHEK, LTD.

5.2        LICENSOR shall have the right to cancel this LICENSE at any time, effective at the conclusion of  thirty ( 30 )¹⁷ days’ written notice to LICENSEE.  Such cancellation shall not relieve LICENSEE of its obligation to pay LICENSOR any sums then due it under this LICENSE. LICENSEE may elect in its notice of cancellation to have the right to sell those DEVICES it has on hand and that would have been subject to the terms of this LICENSE had this LICENSE remained in force, by agreeing to pay the royalties as set forth herein, provided that such right on the part of LICENSEE shall terminate upon the expiration of one year from the effective date of such cancellation.

5.3        Any and all disputes arising in connection with this LICENSE that cannot be settled by negotiation between the parties hereto, shall, at the request of either or both parties, be referred to and finally settled under the then prevailing Rules of the American Arbitration Association by one or more arbitrators appointed in accordance with said Rules.  Notwithstanding any provisions of the Rules of the American Arbitration Association or any applicable state or federal law, the parties agree that the Arbitration cannot award exemplary or punitive damages.  Judgment upon the award rendered may be entered in any court having jurisdiction, or application may be made to the court for judicial acceptance of the award and an order of enforcement, as the case may be.  All arbitration proceedings shall take place in                St. Louis          (city),                     Missouri                   (state)¹⁸.

                                                                   ARTICLE VI

                                                          RECORDS AND AUDIT

6.1        LICENSEE shall keep and cause its AFFILIATES to keep true and accurate records relating to DEVICES sold under this LICENSE to the extent necessary for making the reports and payments provided for herein.  Such records shall be open for inspection by LICENSOR through an independent Certified Public Accountant appointed by it, or for inspection by any other person to whom LICENSEE has no objection, in order to permit LICENSOR to determine the accuracy of reports and payments hereunder.  It is the intent of the parties that the person making such inspection shall not disclose to LICENSOR or others any business details that may be found in LICENSEE's records which are not necessary in determining the accuracy of the reports and payments.  The inspection provided for herein shall be made during business hours and not more often than once each calendar year.

ARTICLE VII

                                               CHANGES IN STATUS OF CLAIMS

7.1        If, during the life of this LICENSE, any claim included in the PATENT RIGHTS is disclaimed or becomes canceled or of no force or effect by operation of law (as through an adverse interference judgment or otherwise), then such claims shall be considered as no longer included in said PATENT RIGHTS unless and until it becomes reinstated, beginning with the date of such disclaimer or cancellation or the date it becomes of no force or effect.

7.2        If, during the TERM, a claim of the PATENT RIGHTS shall be construed or held invalid by a court of competent jurisdiction from whose decision no appeal is taken, then for the purpose of this LICENSE the construction placed upon such claim shall thereafter be followed and any claims so held invalid shall be ignored. 

            IN WITNESS THEREOF, the parties have caused this agreement to be executed by their respective officers thereunto duly authorized as of the dates respectively indicated.

                                    LICENSOR                                                      LICENSEE

                                Tony Carter        ¹⁹            Timothy Walters        ²³                (Signature)                                                        (Signature)

                        By                    Tony Carter             ²⁰         By        Timothy Walters                    ²⁴

                        Title                  President                ²¹            Title      President                              ²⁵

                        Dated               04/21/2005               ²²             Dated        04-21-2005                     ²⁶

This is not a substitute for legal advice.  An attorney must be consulted.
Copyright ©1994 - 2024 by LAWCHEK, LTD.