DETAILED LICENSE CONTRACT

 

This Detailed License Contract (hereinafter the “Contract”) is made is made as
of June 20, 2012 in Milan, Italy.

 

BY AND BETWEEN

 

 

ThermoEnergy Corporation, a Delaware corporation, having its principal office at
10 New Bond Street, Worcester, MA, USA, represented by Mr. Cary Bullock
(together with TEPS, hereafter "Thermo");

 

ThermoEnergy Power Systems LLC, a Delaware limited liability company and a
subsidiary of Thermo, having its principal office at 10 New Bond Street,
Worcester, MA, USA, represented by Mr.Cary Bullock (“TEPS” and, together with
Thermo, “ThermoEnergy”);

 

and

 

Itea S.p.A., a company organised and existing under the laws of Italy, having
its principal office at Via Santa Margherita n. 18 - 40136 Bologna, Italy,
represented by Mr. Alvise Bassignano (hereafter “Itea”);

 

and

 

Unity Power Alliance LLC, a Delaware limited liability company, having its
principal office at 10 New Bond Street, Worcester, Ma, USA, represented by Mr.
Robert Marrs (hereafter "UPA");

 

ThermoEnergy, Itea and UPA shall be jointly referred to as the “Parties”, and
individually referred to as a “Party”.

 

FOREWORD

 

WHEREAS,

 

A.     ThermoEnergy and Itea have agreed to collaborate in order to advance,
develop and promote the use of pressurized oxy-combustion in the Territory
through the realization of a pilot plant and subsequent demonstration facility
based on this technology.

 

B.     ThermoEnergy has formed Unity Power Alliance LLC, a Delaware limited
liability company, which is currently owned 100% owned by ThermoEnergy,
provided, however, Itea may acquire 50% of the participation in UPA in
accordance with the terms of the Agreement, dated June 20, 2012, by ThermoEnergy
and Itea (hereafter the “Agreement”).

 

C.     UPA is seeking to be awarded the Funding Opportunity DE-FOA-0000636
(hereafter the "F.O.”). UPA and Itea entered into the Contractor Agreement under
which Itea is a nominated contractor for certain services to be provided to UPA
in case of the award of the F.O. (hereafter the "Contract Agreement”).

 

D.     In consideration of the foregoing, the Parties wish to determine their
rights and obligations in regard to licenses to be granted to UPA and commercial
terms in regard to the royalties to be paid by ThermoEnergy to Itea and by Itea
to ThermoEnergy according to this Contract.

 

 

 

 

NOW, therefore, in consideration of the premises and mutual covenants set forth
herein, the Parties hereby agree as follows:

 

1.         DEFINITIONS AND INTERPRETATION

 

1.1.     Definitions

 

For the purposes of this Contract, the words and expressions defined below shall
have the following meanings, unless the context otherwise requires:

 

1.1.1.     Affiliate in relation to a Party, means any entity or person which
directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with that Party. For the purposes of
this definition, control shall mean direct or indirect beneficial ownership of
50% (or, outside a Party's home territory, such lesser percentage as is the
maximum, permitted level of foreign investment) or more of the share capital,
stock or other participating interest carrying the right to vote or to
distribution of profits of that entity or person, as the case may be.

 

1.1.2.     Come into force means the date on which this Contract has been duly
signed by the Parties and any necessary governmental consents (if any) have been
obtained thereof.

 

1.1.3.     Contract means this Contract, including annexes, appendixes, any
further documents (if any), which are listed in this Contract, and any
amendments concluded by the Parties with the terms and subject to the conditions
of this license agreement.

 

1.1.4.     Effective Date means the date on which Itea acquires 50% of the
participation in UPA in accordance with the terms of the Agreement and any
necessary governmental consents (if any) have been obtained thereof.

 

1.1.5.     Field of Use means (i) advance, develop and promote the use of the
coal application of pressurized oxy-combustion in the Territory for the
realization of a pilot plant; (ii) the realization of a pilot plant; (iii)
subsequent demonstration facility based on the technology as per item (ii); and
(iv) implementation of F.O. should it be awarded to UPA, all as indicated in
Article 2.2 of the Agreement.

 

1.1.6.     Improvements mean any and all improvements, modifications or
adaptations, new applications and other developments to the Intellectual
Property and/or Know-how made by either Party during the term of this Contract.

 

1.1.7.     Intellectual Property means patents, trademarks, service marks,
rights (registered or unregistered) in any inventions, designs, applications for
any of the foregoing, trade or business names, copyright (including rights in
computer software), topography rights, internet domain names, rights protecting
goodwill and reputation, database rights (including rights of extraction) and
all rights and forms of protection of a similar nature to any of the foregoing
or having equivalent effect anywhere in the world and all rights under licenses
and consents in respect of any of the rights and forms of protection mentioned
in this definition.

 

1.1.8.     Intellectual Property of Itea means the Intellectual Property of Itea
as detailed in Annex 1 of this Contract.

 

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1.1.9.     Intellectual Property of ThermoEnergy means the Intellectual Property
of ThermoEnergy as detailed in Annex 2 of this Contract.

 

1.1.10.    Know-how means any and all rights (including without limitation,
rights under applicable trade secret laws) in and to any and all confidential,
technical and/or proprietary information and knowledge, whether or not
patentable and whether or not in written form, including, without limitation,
information, inventions, know-how and knowledge regarding inventions,
discoveries, techniques, research in progress, trade secrets, systems, methods,
processes, algorithms, technical data, formulae, drawings, designs, schematics,
blueprints, flow charts, models, prototypes, techniques, manufacturing and
design information, and financial, business, marketing and client information.

 

1.1.11.    License of Construction means the licence to be granted by
ThermoEnergy or Itea, as the case may be, to third parties for manufacture the
equipment and/or construct the plant based on the Intellectual Property and
Know-how. It is agreed that a License of Construction cannot be sublicensed
without the written consent of the Licensor.

 

1.1.12.    License of Use means the licence to be granted by ThermoEnergy or
Itea, as the case may be, to a final user to operate a plant based on the
ascertained Intellectual Property and Know-how. It is agreed that a License of
Use can’t be sublicensed without the written consent of the Licensor.

 

1.1.13.    Licensor means jointly or separately ThermoEnergy and/or Itea.

 

1.1.14.    Parties mean jointly ThermoEnergy, Itea and UPA.

 

1.1.15.    Party means ThermoEnergy, Itea and/or UPA, as the case may be.

 

1.1.16.     Territory means territory of the North America, including, without
limitation, USA, Canada and Mexico.

 

1. 2.     Interpretation

 

1.2.1.     In this Contract the headings are used for convenience only and shall
not affect its interpretation.

 

1.2.2.     In this Contract references to persons shall include incorporated and
unincorporated persons; references to a Party include the above defined
companies, the respective heirs, legal representatives, successors and permitted
assignees.

 

1.2.3.     In this Contract references to singular include plural and vice
versa; and references to masculine include feminine.

 

1.2.4.     In this Contract references to clauses and schedules mean clauses of,
and schedules to, this Contract.

 

1.2.5.     In this Contract the recitals and the schedules shall form an
integral and substantial part of this Contract. In case of any inconsistency or
contradictions between the provisions of the main body of this Contract and the
ones set out in the schedules hereto, the former shall prevail.

 

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2.         GRANT OF RIGHTS TO UPA

 

2.1.     ThermoEnergy hereby grants UPA a non-exclusive, non-transferable and
non-sublicensible, non-assignable license under ThermoEnergy Know-how and
Intellectual Property of ThermoEnergy, as set forth on Annex 1 hereto, and all
Improvements thereon, subject to the provisions of this Contract and of the
Agreement for the sole purpose of to making, having made, using, selling, and
offering for sale the products related to Know-How and Intellectual Property in
the Field of Use within the Territory.

 

2.2.     Itea hereby grants UPA a non-exclusive, non-transferable and
non-sublicensible, non-assignable license under Itea Know-how and Intellectual
Property of Itea, as set forth on Annex 2 hereto, and all Improvements thereon,
subject to the provisions of this Contract and of the Agreement for the sole
purpose of to making, having made, using, selling, and offering for sale the
products related to Know-How and Intellectual Property in the Field of Use
within the Territory.

 

2.3.     UPA shall not enter into any technology/alliance agreement with any
other person, firm or company in regard to the licensed Know-how and
Intellectual Property of Itea and/or ThermoEnergy without each of ThermoEnergy’s
and Itea’s previous written consent.

 

2.4.     The Parties agree that UPA shall have no right to use the Know-how and
Intellectual Property licensed from ThermoEnergy or Itea otherwise than as
expressly licensed to UPA in this Contract. UPA accepts that it shall not
manufacture, assemble, use, install, operate and maintain or sell the products
related to Know-How and Intellectual Property in any country outside the
Territory. In particular, without limitation, UPA shall not:

 

·acquire licenses from any person, firm or company, other than the Licensors, to
any know-how or intellectual property similar to the Know-how and Intellectual
Property licensed from ThermoEnergy and Itea; or

 

·advertise, or solicit orders, establish branches or maintain distribution
depots for the products related to Know-How and Intellectual Property in any
location outside the Territory; or

 

·sell the products related to Know-How and Intellectual Property to any person
outside the Territory or to any person within the Territory intending to export
the such products outside the Territory.

 

2.5.     All documents will be provided in their original language. Translation,
if any, shall be made by UPA on its own costs. UPA shall bear the costs
regarding copying and delivering of said documents.

 

3.          GRANT OF RIGHTS BETWEEN THERMOENERGY AND ITEA. TAXES

 

3.1.        Licence of Use

 

3.1.1.     ThermoEnergy and Itea may enter into License of Use agreements for
their respective Intellectual Property and Know-how between themselves or with
third parties in accordance with this Article 3.1 despite any licence granted to
UPA as per Article 2 of this Contract.

 

3.1.2.   If and only if UPA is successful in garnering the funding and project
support to execute the Pilot facility (at least 50Mwt capacity) in the
Territory, the royalties received by ThermoEnergy or Itea, as the case may be,
for the License of Use shall be shared as follows:

 

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I.Itea shall pay to ThermoEnergy 50% of the royalties earned by Itea from the
License of Use of Itea’s technology for the first 4 plants operated in the
Territory by ThermoEnergy and or legal entities participated by ThermoEnergy

II.Itea shall pay to ThermoEnergy   10% of the royalties earned by Itea from the
License of Use of Itea’s technology  for  further plants operated by
ThermoEnergy and or by third parties in the Territory during the first 10 years
from the licenses

III.ThermoEnergy shall pay to Itea 30% of the royalties earned from the License
of Use of  ThermoEnergy’s technology for plants operated by Itea and or third
parties for the first 15 years in any power plant facility in the world, except
for projects in Europe, and in such case ThermoEnergy shall pay to Itea 60% of
any royalties earned.

 

3.1.3.   If and only if UPA is successful in garnering the funding and support
to execute a demonstration facility (at least 200Mw electrical megawatt) in the
Territory, Article 3.1.2 II, III shall not be applied and the royalties received
by ThermoEnergy or Itea, as the case may be, from the License of Use shall be
shared as follows:

 

I.Without prejudice to article 3.1.2 I Itea shall pay to ThermoEnergy  15% of
the royalties earned from the License of Use of Itea’s technology for further
plants operated by ThermoEnergy and or by third parties in the Territory for the
first 10 years from licenses

II.ThermoEnergy shall pay to Itea 30% of the royalties earned from the License
of Use of  ThermoEnergy’s technology for the first 15 years from licenses in any
power plant facility in the world operated by Itea and or third parties, except
for projects in Europe, and in such case ThermoEnergy shall pay to Itea 60% of
any royalties earned

 

3.1.4.   The royalties from the License of Use to third parties in regard to
common Improvements under UPA activities as per Article 4.7 of this Contract
shall be divided on 50%-50% basis to be paid by ThermoEnergy to Itea or by Itea
to ThermoEnergy, as the case may be.

 

3.2.        Licence of Construction

 

3.2.0.     ThermoEnergy and Itea may enter into any License of Construction
agreements with third parties for their own Intellectual Property and Know-how
despite any licence granted to UPA as per Article 2 of this Contract.

 

3.2.1.      If and only if UPA is successful in garnering the funding and
project support to execute the Pilot facility (at least 50Mwt capacity) in the
Territory, the royalties received by ThermoEnergy or Itea, as the case may be,
for the License of Construction shall be shared as follows:

 

I.Itea shall pay to ThermoEnergy 10% of the royalties earned for the first 10
years by Itea from the License of Construction to third parties based on Itea’s
technology for oxy-combustion in the territory.

II.ThermoEnergy shall pay to Itea 30% of the royalties earned for the first 15
years by ThermoEnergy from the License of Construction to third parties based on
ThermoEnergy’s technology for oxy-combustion of coal in any power plant facility
in the world, except for projects in Europe, and in such case ThermoEnergy shall
pay to Itea 60% of any royalties earned.

III.No License of Construction shall be granted to third parties by ThermoEnergy
on Itea’s technology or by Itea on ThermoEnergy’s technology.

 

3.2.3.     If and only if UPA is successful in garnering the funding and support
to execute a demonstration facility (at least 200Mwt electrical megawatt) in the
Territory, Article 3.2.1 shall not be applied and the royalties received by
ThermoEnergy or Itea, as the case may be, from the License of Construction shall
be shared as follows:

 

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I.Itea shall pay to ThermoEnergy 15% of the royalties earned for the first 10
years by Itea from the License of Construction to third parties based on Itea’s
technology for oxy-combustion in the territory.

II.ThermoEnergy shall pay to Itea 30% of the royalties earned for the first 15
years by ThermoEnergy from the License of Construction to third parties based on
ThermoEnergy’s technology for oxy-combustion of coal in any power plant facility
in the world, except for projects in Europe, and in such case ThermoEnergy shall
pay to Itea 60% of any royalties earned.

III.No License of Construction shall be granted to third parties by ThermoEnergy
on Itea’s technology or by Itea on ThermoEnergy’s technology.

 

3.2.4.     The royalties from the License of Construction to third parties in
regard to common Improvements under UPA activities as per Article 4.7 of this
Contract shall be divided on 50%-50% basis to be paid by ThermoEnergy to Itea or
by Itea to ThermoEnergy, as the case may be.

 

3.3.       Taxes

 

3.3.1.     Each party shall be exclusively liable for all incomes, taxes,
duties, and other charges of every character incurred with respect to this
Contract, its performance or financial results, and which are imposed by, or
payable to any governmental authority (including any department, agency or
subdivision thereof).

 

4.        INTELLECTUAL PROPERTY RIGHTS AND IMPROVEMENTS

 

4.1.     Each Party shall remain owner of all Intellectual Property and Know-how
it owns at the Effective Date of this Contract. Neither Party acquires any
intellectual property rights under this Contract, through use of knowledge, even
partially, of any confidential information disclosed by the other Party. No
Party shall represent in any manner that it has any ownership of Know-how and
other Intellectual Property owned by the other Party and the use of Know-how and
other Intellectual Property shall not create any rights or interests other than
those specifically granted by this Contract. The ownership of Know-how and other
Intellectual Property and the goodwill relating to them shall always remain
vested in the applicable Licensor, both during the term of this Contract and
thereafter.

 

4.2.     All the Intellectual Property owned by Itea, as well the as the
Improvements thereon and on accrued Know-how and patentable rights developed
based on the pre-existing flameless technology and the Itea combustion process
in the range of 0-50 bars shall belong exclusively to Itea.

 

4.3.     All the Intellectual Property owned by ThermoEnergy, as well the as the
Improvements thereon and on accrued Know-how and patentable rights developed on
the ThermoEnergy combustion process in the range of 50-75 bars shall belong
exclusively to ThermoEnergy.

 

4.4.     UPA shall communicate to ThermoEnergy all Improvements made by UPA to
ThermoEnergy Know-how and Intellectual Property of ThermoEnergy licensed
hereunder.

 

4.5.     UPA shall communicate to Itea all Improvements made by UPA to Itea
Know-how and Intellectual Property of Itea licensed hereunder.

 

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4.6.     All Intellectual Property created by UPA that is not based on either
Itea’s or ThermoEnergy’s Intellectual Property or accrued Know-how, will be will
be owned in common by ThermoEnergy and Itea and will be licensed to UPA.
ThermoEnergy and Itea shall share the royalties between themselves from the
licenses granted under such common ownership in accordance with Article 3 of
this Contract.

 

4.7.     In case any Improvements are made related to Know-how and Intellectual
Property of both ThermoEnergy and Itea and provided that such Improvements
cannot be separated, the Intellectual Property relating to such new developments
shall belong to ThermoEnergy and Itea in common and ThermoEnergy and Itea shall
at their joint expense take all reasonable steps necessary to protect the same.
If either ThermoEnergy or Itea, as the case may be, does not cooperate with the
other in applying for registration of such new developments, where such
registration is required, in any country within nine (9) months after
identification of such Improvements, the other Party (ThermoEnergy or Itea)
shall have the right to apply (in its own name and at its own cost) for
registration in all countries where ThermoEnergy and Itea, as the case may be,
has failed to cooperate in such filing, and the non-cooperating Party
(ThermoEnergy and Itea, as the case may be) shall have a non-exclusive,
royalty-free license without the right to grant sublicenses under such
Improvements. ThermoEnergy and Itea shall share the royalties between themselves
from the licenses granted under such common ownership in accordance with Article
3 of this Contract.

 

4.8.     If any warning letter or other notice of infringement is received by
any Party, or legal suit or other action is brought against any Party, alleging
infringement of third party rights in the Know-how or any Intellectual Property
licensed by ThermoEnergy or Itea hereunder, such informed Party shall promptly
provide full details to the applicable Licensor, and the Parties shall discuss
the best way to respond. To the maximum extent permitted by the law, the
applicable Licensor shall lead and have full control of any dispute relating to
its Intellectual Property and Know-how and the other Parties shall on request
provide full co-operation and assistance to the applicable Licensor in its
defence in any such dispute. Each of ThermoEnergy and Itea shall indemnify and
hold the other Party and UPA harmless from and against any and all losses, costs
and expenses (including reasonable attorneys’ fees) suffered or incurred by such
other Party or by UPA as a result of any actual or alleged infringement of third
party rights in the Know-how or any Intellectual Property licensed by it
hereunder.

 

4.9.     If any Party becomes aware of any unlawful use or infringement or any
act of unfair competition committed by a third party with respect to any
Licensed Product or a Party’s Know-how or Intellectual Property, such Party
shall promptly provide full details of such infringement to the other Parties.
To the maximum extent permitted by the law, the applicable Party shall lead and
have full control of any dispute relating to the unlawful use or infringement,
or any act of unfair competition committed by the third party and the other
Parties shall on request provide full co-operation and assistance to the
applicable Licensor in any such dispute.

 

5.        REPORTS

 

5.1.     UPA shall communicate to the owner of the Intellectual Property or
Know-how within thirty (30) days following the date of receiving an order based
on such Intellectual Property or Know-how and parts, services and components
thereof and all modifications thereto. Such report shall include the customer’s
name, description of the products, delivery schedule, date of execution of the
contract and royalty fees foreseen for the applicable Licensor. Any change to
the above shall be reported accordingly.

 

5.2.     ThermoEnergy shall present the reports to Itea and Itea shall present
the reports to the ThermoEnergy in regard to any license agreements with third
parties (for construction and/or utilisation) in the Territory or Europe for
their own Intellectual Property and Know-how leading to the share of the
royalties between them as per Article 3 of this Contract.

 

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5.3.     Each Party shall keep during the term of this Contract complete, true
and accurate books of account containing all information that may be necessary
for the purpose of documenting the amounts payable under Article 3 of this
Contract. All such books of account shall be open, with seven (7) days advance
notice and at least quarterly, for five (5) years following the end of the
quarter to which they pertain, to the inspection, subject to confidentiality,
for the purpose of verifying compliance with the terms of this Contract.

 

6.        CONFIDENTIALITY

 

6.1.     The content of this Contract and all information and documents (whether
in written, oral or other form) exchanged by the Parties in connection
therewith, are confidential (hereinafter the “Confidential Information”). Each
of the Parties:

 

·shall treat strictly confidential the provisions of this Contract, the process
of the negotiations and all information about the other Party obtained or
received by it as a result of entering into or performing its obligations under
this Contract. It is hereby acknowledge and understood that the Confidential
Information shall include the trademark, the know-how, the technical
information, prototypes, trade secrets, pending or abandoned patent
applications, invention disclosures, designs, programs, plants, documents,
specifications, models, marketing studies, profits, costs, pricing, process
descriptions, manufacturing processes and all other information which a
disclosing party holds confidential;

·shall not, except with the prior written consent of the other Party or as
otherwise set forth below, make use of (save for the purposes of performing its
obligations under this Contract) or disclose to any person any of the
Confidential Information.

 

6.2     For the purposes of this the information is not considered as
confidential if:

 

·such information was in the possession of a receiving Party and at its free
disposal prior to receipt by a disclosing Party; or

·such information is subsequently disclosed without any obligations of
confidence by a third party who has not derived it directly or indirectly from a
disclosing Party; or

·such information is or becomes generally available to the public through no act
or default of a receiving Party or its agents, employees, affiliates or
sub-licensees; or

·such information is available to a receiving Party because of its independent
research made without use or access to the information acquired from a
disclosing Party.

 

6.3.     For the purpose of Article 6.2, any information which is specific to a
particular process, condition, apparatus, or composition shall not be deemed to
be in the public domain or in the prior possession of the receiving Party merely
because it is embraced in a more general disclosure, which is in the public
domain or in the prior possession of the receiving Party.

 

6.4.     If a receiving Party or any of its representatives is required by law
or any directive, decision, order or regulation having the force of law to
disclose any Confidential Information, then a receiving Party or the relevant
representative, as the case may be, shall promptly notify a disclosing Party of
such requirement (and the deadline for disclosure) by written notice confirming
the binding nature of such requirement and the extent to which the Confidential
Information is to be disclosed in accordance with such requirement.

 

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6.5.     The receiving Party shall procure that all of its employees,
contractors and sub-licensees pursuant to this Contract (if any), who have
access to any confidential information to which Article 6 apply, shall be made
aware of and subject to these obligations and shall have entered into written
consent to undertake confidentiality at least as restrictive as provided by
Article 6.

 

7.        TECHNICAL ASSISTANCE

 

7.1.     Upon UPA's reasonable request, subject to limitations of ThermoEnergy’s
available resources and in accordance with terms and conditions stated hereof,
ThermoEnergy shall provide reasonable technical assistance relating to the
licensed ThermoEnergy Know-how and Intellectual Property of ThermoEnergy.

 

7.2.     Upon UPA's reasonable request, subject to limitations of Itea’s
available resources and in accordance with terms and conditions stated hereof,
Itea shall provide reasonable technical assistance relating to the licensed Itea
Know-how and Intellectual Property of Itea.

 

8.        MARKINGS AND QUALITY

 

8.1.     UPA shall procure product markings, to be approved by the relevant
Licensor, on all products related to Know-How and Intellectual Property or
manufactured units thereof indicating that such products are made under license,
and indicating the applicable Licensor's name and other relevant information.

 

8.2.     Each Party undertakes to use its reasonable business efforts to ensure
that the reputation and prestige of products related to Know-How and
Intellectual Property are maintained. Furthermore, UPA shall manufacture
products related to Know-How and Intellectual Property in accordance with the
specifications and standards of quality established by the Licensors.

 

8.3.     UPA shall guarantee that products related to Know-How and Intellectual
Property comply with the requirements set by laws applicable in the countries in
which such products are sold or supplied.

 

9.        REPRESENTATIONS, WARRANTIES AND COVENANTS

 

9.1.     ThermoEnergy hereby represents, warrants and covenants that:

 

·all corporate actions on the part of ThermoEnergy necessary for the
authorisation, execution and delivery of this Contract and the performance of
its obligations hereunder have been taken;

 

·this Contract is a legal, valid and binding obligation of ThermoEnergy;

 

·the Intellectual Property of ThermoEnergy is free and clear of all liens and
other encumbrances;

 

·the Intellectual Property of ThermoEnergy has not been held by a court of
competent jurisdiction to be invalid or unenforceable;

 

·there are no pending, or, to the knowledge of ThermoEnergy, threatened claims
against ThermoEnergy alleging that its Intellectual Property violates any
intellectual property rights of a third party or constitutes a misappropriation
of any subject matter of any intellectual property rights of a third party.

 

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9.2.     Itea hereby represents, warrants and covenants that:

 

·all corporate actions on the part of Itea necessary for the authorisation,
execution and delivery of this Contract and the performance of its obligations
hereunder have been taken;

 

·this Contract is a legal, valid and binding obligation of Itea;

 

·the Intellectual Property of Itea is free and clear of all liens and other
encumbrances;

 

·the Intellectual Property of Itea has not been held by a court of competent
jurisdiction to be invalid or unenforceable;

 

·there are no pending, or, to the knowledge of Itea, threatened claims against
Itea alleging that its Intellectual Property violates any intellectual property
rights of a third party or constitutes a misappropriation of any subject matter
of any intellectual property rights of a third party.

 

9.3.     UPA hereby represents, warrants and covenants that:

 

·all corporate actions on the part of UPA necessary for the authorization,
execution and delivery of this Contract and the performance of its obligations
hereunder have been taken;

 

·this Contract is a legal, valid and binding obligation of UPA;

 

·neither the execution and delivery of this Contract nor the performance of the
obligations contemplated hereby will (i) conflict with or result in any
violation of or constitute a breach of any of the terms or provisions of, or
constitute a default under any provision of any contract or any other obligation
to which UPA is a party or under which UPA is subject or bound, or (ii) violate
any judgment, order, injunction, decree or award of any judicial or governmental
authority against, or affecting or binding upon, UPA or upon the assets,
property or business of UPA, or (iii) constitute a violation by UPA of any
applicable laws of any jurisdiction as such laws relate to UPA or to the
property or business of UPA.

 

9.4     EXCEPT AS SET FORTH IN THIS CONTRACT, EACH LICENSOR IS LICENSING ITS
KNOW-HOW AND INTELLECTUAL PROPERTY HEREUNDER ON AN AS-IS BASIS AND EACH LICENSOR
MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE
KNOW-HOW AND INTELLECTUAL PROPERTY GRANTED HEREUNDER. BY WAY OF EXAMPLE, BUT NOT
OF LIMITATION, EACH LICENSOR MAKES NO REPRESENTATIONS OR WARRANTIES (I) OF
COMMERCIAL UTILITY; (II) OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE;
OR (III) CONCERNING THE VALIDITY OR SCOPE OF THE KNOW-HOW AND INTELLECTUAL
PROPERTY.

 

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10.        LIMITATION OF LIABILITY

 

10.1.     Notwithstanding any other provision of this Contract, in no case shall
the Parties be liable to each other, whether arising under contract, tort
(including negligence), strict liability, for loss of anticipated profits, loss
by reason of plant shutdown, non-operation or increased expense of operation,
service interruption, cost of purchased or replacement power, claims of
customers, loss of use of capital or revenue, or for any special, incidental,
indirect or consequential loss or damage or any nature arising at any time or
from any cause whatsoever.

 

11.        TERM AND TERMINATION

 

11.1.     The Parties agree that this Contract shall come into force on the date
of its signature by all Parties. However, this Contract shall be fully effective
only from the Effective Date.

 

11.2.     In regard to UPA this Contract shall remain valid until the
termination of the Agreement. In regard to the other Parties this Contract shall
remain valid until the first of the following events occurs:

 

(i)fifteen (15) years after the Effective Date, if this Contract is not extended
by mutual agreement of the Parties;

(ii)the mutual agreement by the Parties to terminate this Contract;

(iii)at the election of a Party if the other Party commits a material breach of
any term or provision of this Contract and (if such breach is remediable) fails
to remedy such breach within thirty (30) days or any other period, provided by
the Party not in default;

(iv)at the election of a Party if the other Party (a) admits in writing its
inability to pay its debts generally as they become due, (b) makes a general
assignment for the benefit of creditors, (c) institutes proceedings to be
adjudicated a voluntary bankrupt, or consents to the filing of a petition of
bankruptcy against it, (d) seeks reorganization under any bankruptcy act, or
consents to the filing of a petition seeking such reorganization, or (e) has a
decree entered against it by a court of competent jurisdiction appointing a
receiver, liquidator, trustee, or assignee in bankruptcy or in insolvency
covering all or substantially all of its property or providing for the
liquidation of its property or business affairs; provided, however, that this
Contract may not be terminated pursuant to this Section 11.2(iv) if the other
Party generally continues to do business following the occurrence of any of the
foregoing events without committing any breach of any term or provision of this
Contract (including any payment breach).

 

 

11.3.     Upon termination of this Contract for any reasons whatsoever:

 

·except as provided in this Article, the rights and the obligations of the
Parties under this Contract shall immediately terminate;

 

·UPA shall no longer be licensed to use or otherwise exploit in any way, either
directly or indirectly, Know-how or any other Intellectual Property of the other
parties;

 

·UPA shall consent to the cancellation of any formal licence granted to it, or
of any registration of it in any register, in relation to this Contract;

 

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·any rights or obligations to which any of the Parties to this Contract may be
entitled or be subject before its termination shall remain in full force and
effect; in particular, termination shall not affect or prejudice any right to
damages or other remedy which the applicable Licensor may have in respect of the
event giving rise to the termination or any other right to damages or other
remedy which the applicable Licensor may have in respect of any breach of this
Contract that existed at or before the date of termination;

 

·termination shall not affect or prejudice the provisions regarding
confidentiality, representations, warranties and covenants, limitation of
liability, arbitration and governing law;

 

·termination shall not affect or prejudice the rights of any third party under
any License of Use validly granted prior to the date of termination;

 

·within 5 (five) days after the termination of this Contract, UPA and any other
Party shall: (i) return to the applicable Licensor (or, at such Licensor's
direction) all equipment, drawings, reports, spreadsheets, instruction and
training manuals, tables of operating conditions, specifications, tables and
procedures, and other documents, files, software, tools or materials (whether in
tangible or electronic form) supplied by the applicable Licensor under this
Contract and/or which contain Know-how or Intellectual Property and all copies
thereof then in the possession or under the direct control of UPA or any other
Party or any of their officers, directors, employees or consultants; and (ii)
deliver to the applicable Licensor a written statement confirming that all
obligations regarding returning of the above stated information and/or material
have been complied with.

 

12.       GOVERNMENT CONSENT

 

12.1.     Upon the Effective Date, UPA shall make due applications for any
necessary registration and/or governmental approval of this Contract where
necessary throughout North America, if necessary. UPA shall furnish satisfactory
evidence of receipt of such governmental approval. All expenses incurred due to
such registration and approval shall be covered by UPA.

 

13.       FORCE MAJEURE

 

13.1.     Neither Party shall have any liability or be deemed to be in breach of
this Contract for any delays or failures in performance of this Contract that
result from circumstances beyond the reasonable control of that Party, including
but not limiting to act of God, war, civil disturbance, strike, lockout,
interruption of transportation, inability to procure or shortage supplied
materials, equipment, productions facilities or engineering recourses,
legislation or restriction of any governmental or other authority. The Party
affected by such circumstances shall promptly notify the other Party in writing
when such circumstances cause a delay or failure in performance and when they
cease to do so.

 

14.       AGENCY

 

14.1.     Neither Party shall act or describe itself as the agent of the other,
nor shall it make or represent that it has authority to make any commitments on
the other's behalf.

 

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15.       SEVERABILITY

 

15.1.     If any term or other provision of this Contract is invalid, illegal or
incapable of being enforced by any rule of law or public policy, all other
conditions and provisions of this Contract shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to any
Party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the Parties hereto shall negotiate in
good faith to modify this Contract so as to effect the original intent of the
Parties as closely as possible in an acceptable manner to the end that the
transactions contemplated hereby are fulfilled to the fullest extent possible.

 

16.       NOTICE

 

16.1.     Any notice, request, demand other communication required or permitted
hereunder shall be in writing and sent to the addresses set forth below or to
such other address as a Party may designate by notice to the other Party:

 

·if to ThermoEnergy: 10 New Bond Street, Worcester, MA, USA;

·if to Itea: Largo Buffoni, 3, 21013 Gallarate (VA)- Italy;

·if to UPA: 10 New Bond Street, Worcester, MA, USA.

 

16.2.     All communications between the Parties hereto or with respect to this
Contract shall be in English language.

 

17.       DISPUTE RESOLUTION

 

17.1.     Should any claim, dispute or controversy arise between the Parties in
connection with this Contract, the Parties shall seek the amicably settlement of
that dispute. If the dispute is not settled amicably within 20 (twenty) days, or
such further period as the Parties shall agree in writing, the dispute shall be
referred to and finally resolved by arbitration in accordance with ICC Rules of
Conciliation and Arbitration. The place of arbitration shall be Boston,
Massachusetts. The language of arbitration shall be English. Notwithstanding the
foregoing, in the event of a threatened, actual or claimed breach of the
confidential information or intellectual property provisions hereunder, either
Party may by-pass the provisions of this dispute resolution provision and
immediately seek relief in a court of competent jurisdiction to stay any
threatened or continued breach of the foregoing.

 

18.       GOVERNING LAW

 

18.1.     This Contract shall be subject to the Laws of The Commonwealth of
Massachusetts, without giving effect to the choice of law rules thereof.

 

19.       ENTIRE AGREEMENT

 

19.1.     This Contract, and any annexes, appendixes thereto, reflect the entire
agreement of the Parties with respect to its subject matter.

 

20.       AMENDMENTS AND WAIVER

 

20.1.     This Contract may not be amended or modified, nor may compliance with
any condition or covenant set forth herein be waived, except by a writing duly
and validly executed by each of the Parties hereto. No delay on the part of any
Party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall any waiver on the part of any Party of any such right,
power or privilege, or any single or partial exercise of any such right, power
or privilege, preclude any further exercise there of or the exercise of any
other such right, power or privilege.

 

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21.       ASSIGNMENT

 

21.1.     UPA shall not assign, mortgage, charge or otherwise transfer any
rights or obligations under this Contract without the prior written consent of
the Licensors. Any assignment of this Contract or of the rights or obligations
hereunder by UPA without the prior written consent of the Licensors shall be
null and void.

 

21.2.     Neither ThermoEnergy nor Itea shall assign, mortgage, charge or
otherwise transfer any rights or obligations under this Contract without the
prior written consent of the other Party, provided, however, either Licensor may
assign this Contract to an affiliate or to the successor in interest following a
merger or sale of a controlling equity interest or substantially all of its
assets.

 

In witness whereof, the Parties have caused this Contract to be duly executed in
their respective names and on their behalf.

 

ThermoEnergy Corporation   Itea S.p.A.               By: /s/ Cary Bullock   By:
/s/  Alvise A. Bassignano   Name: Cary Bullock   Name: Alvise A. Bassignano  
Title: CEO   Title: Managing Director                           ThermoEnergy
Power Systems LLC                     By: /s/ Cary Bullock         Name: Cary
Bullock         Title: President                                 Unity Power
Alliance LLC                     By: /s/  Robert Marrs         Name: Robert
Marrs         Title: Managing Director        

 

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