PATENT
LICENSING AGREEMENT BETWEEN MANTHEY REDMOND CORPORATION AND MANTHEY REDMOND
(AUST) PTY LIMITED

     

    THIS
AGREEMENT is made on May 1, 2009.

     

    BETWEEN:

     

    MANTHEY REDMOND (AUST) PTY LTD
(“the
owner”),

     

    AND

     

    MANTHEY REDMOND CORPORATION
(“the
licensee”),

     

    (hereinafter
collectively the “Parties”)

     

    WITNESSETH:

     

    
      	
            	
              A.

            	
              WHEREAS,
      the owner is the registered proprietor of or applicant for the
      Patents.

            


    

     

    
      	
            	
              B.

            	
              The
      owner is willing to grant to the Licensee, and the Licensee is willing to
      accept, a licence under the Patents in accordance with the provisions of
      this Agreement.

            


    

     

    WHEREBY
IT IS AGREED:

     

    
      	
               
      

            	
              1.

            	
              Definitions

            


    

     

    In this
Agreement the following words shall have the following meanings: 

     

    “Commencement
Date”                      
July 1, 2009 

     

    “Invention”                                                   
the invention claimed in the Patents;

     

    “Licensed
Products”     
any and all products that are manufactured by the Licensee or its sub-licensee
and are within any of the claims of the Patents;

     

    “Parties”     
the Owner and the Licensee, and “Party” shall mean either
of them;


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    “Patents”     
any and all of the patents that are, or will be granted in the future based on
the description of invention referred to in schedule 1, including any
continuations, continuations in part, extensions, reissues, divisions, and
including any patents, supplementary protection certificates and similar rights
that are based on or derive priority from the foregoing;

     

    “Supply”     
any disposition of Licensed Products whether under a contract of sale, hire,
leasing or otherwise, including the supply by the Licensee to itself for its own
use, but excluding the supply to itself for the purposes of supply to
others;

     

    “Territory”     
any territory in which the Owner holds a patent or has made application for a
patent to protect the invention referred to in the patents.

     

    
      	
            	
              2.

            	
              Grant

            


    

     

    
      	
            	
              1.

            	
              Licence

            


    

     

    The Owner
hereby grants to the Licensee, subject to the provisions of this Agreement and
payment as set out in clause 3, a license under the Patents with the right to
sublicense, subject to clause 2.3 below, to develop, manufacture, have
manufactured, use and sell or supply Licensed Products in the
Territory.

     

    
      	
            	
              2.

            	
              Formal
      licences

            


    

     

    The
Parties shall execute such formal licences as the Licensee’s patent advisers
consider may be necessary or appropriate for registration with Patent Offices
and other relevant authorities to particular territories.

     

    
      	
            	
              3.

            	
              Sub-licensing

            


    

     

    The
Licensee shall be entitled to grant sub-licences of its rights under this
Agreement to any person provided that:

     

    
      	
               
      

            	
              a.

            	
              the
      sub-licence shall include obligations on the sub-licensee which are
      equivalent to the obligations on the Licensee under this
      Agreement;

            


    


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      	
               
      

            	
              b.

            	
              the
      sub-licence shall terminate automatically on the termination of this
      Agreement for any reason;

            


    

    
      	
               
      

            	
              c.

            	
              within
      30 days of the grant of any sub-licence the Licensee shall provide to the
      owner a true copy of it; and

            


    

    
      	
               
      

            	
              d.

            	
              the
      Licensee shall be responsible for any breach of the sub-licence by the
      sub-licensee, as if the breach had been that of the Licensee under this
      Agreement, and the Licensee shall indemnify the Owner against any loss,
      damages, costs, claims or expenses which are awarded against or suffered
      by the Owner as a result of any such breach by the
      sub-licensee.

            


    

     

    
      	
               
      

            	
              4.

            	
              Information and
      Improvements

            


    

     

    Upon
execution of this agreement by the Parties and upon the execution of a
confidentiality agreement by the Licensee, the Owner shall:

     

    
      	
              a.

            	
              Inform,
      if requested, the Licensee of all technical information concerning the
      Inventions known to the Owner;

            


    

    
      	
              b.

            	
              supply
      the Licensee with any documents or drawings relevant to the Inventions;
      and

            


    

    
      	
              c.

            	
              License
      the Licensee to use such documents, drawings and technical
      information.

            


    

     

    
      	
               
      

            	
              2.

            	
              If
      during the continuation of this Agreement the Owner shall develop or
      discover any improvement to the Invention (“Improvement”), the Owner
      shall promptly notify the Licensee and provide full details to the
      Licensee.

            


    

     

    
      	
               
      

            	
              3.

            	
              At
      the request of the Licensee, the Owner shall grant to the Licensee a
      royalty-free licence to make use of any
  improvement(s).

            


    

     

    
      	
               
      

            	
              5.

            	
              No other
      licence

            


    

     

    It is
acknowledged and agreed that no licence is granted by the Owner to the Licensee
other than the licence expressly granted by the provisions of this clause
2.

     

    
      	
               
      

            	
              6.

            	
              Quality

            


    

    The
Licensee shall ensure that all of the Licensed Products marketed by it and its
sub-licensees comply with all applicable laws and regulations in each part of
the Territory.

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      	
               
      

            	
              7.

            	
              Patent
      markings

            


    

    The
Licensee shall mark or cause to be marked in a legible manner on some
conspicuous part of the Licensed Products (or if this is not possible on the
packaging of the Licensed Products) words indicating, as applicable, either that
patents have been applied for or patents have been granted in respect of the
Licensed Product and giving the relevant patent application number(s) or patent
number(s).

     

    
      	
            	
              3.

            	
              Payments

            


    

     

    
      	
            	
              1.

            	
              Initial
      Payment

            


    

     

    The
Licensee is not required to pay an initial payment.

     

    
      	
            	
              2.

            	
              Royalties

            


    

     

    The
Licensee is required to pay a royalty equal to 5% of its gross annual profits
earned as a result of this licence.

     

    
      	
            	
              4.

            	
              Intellectual
      property

            


    

     

    
      	
            	
              1.

            	
              Obtain and maintain
      Patents

            


    

     

    The Owner
shall, at the costs and expense to be paid by the Licensee for the duration of
this agreement:

     

    
      	
               
      

            	
              a.

            	
              endeavour
      to obtain valid patents pursuant to each of the patent applications based
      on the invention described in Schedule 1(or improvements thereto) so as to
      secure the broadest monopoly reasonably available;
  and

            


    

    
      	
               
      

            	
              b.

            	
              pay
      all renewal fees in respect of the Patents as and when
  due.

            


    

    
      	
               
      

            	
              c.

            	
              Pay
      all costs necessary to ensure the Owner maintains ownership of all patents
      for the duration of this agreement.

            


    

     

    Infringement
of the Patents

     

    
      	
               
      

            	
              1.

            	
              Each
      Party shall inform the other Party promptly if it becomes aware of any
      infringement or potential infringement of any of the Patents, and the
      Parties shall consult with each other to decide the best way to respond to
      such infringement.

            


    


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      	
               
      

            	
              2.

            	
              If
      the Parties fail to agree on a joint programme of action, including how
      the costs of any such action are to be borne and how any damages or other
      sums received from such action are to be distributed, then the Licensee
      shall be entitled to take action against the third party at is sole
      expense and it shall be entitled to all damages or other sums received
      from such action, after reimbursing the Owner for any reasonable expenses
      incurred in assisting it in such action. The Owner shall agree to be
      joined in any suit to enforce such rights subject to being indemnified and
      secured in a reasonable manner as to any costs, damages, expenses or other
      liability and shall have the right to be separately represented by its own
      counsel at its own expense. After recovery of the Owner’s and the
      Licensee’s costs of
      taking such action, any net sum recovered by the Licensee from a third
      party infringer shall be treated as if it were the Net Sales Value of
      Licensed Products on which the Licensee shall pay royalties to the Owner
      in accordance with the provisions of this
  Agreement.

            


    

     

    
      	
            	
              2.

            	
              Infringement of third party
      rights

            


    

     

    
      	
               
      

            	
              1.

            	
              If
      any warning letter or other notice of infringement is received by a Party,
      or legal suit or other action is brought against a Party, alleging
      infringement of third party rights in the manufacture, use or sale of any
      Licensed Product or use of any Patents, that Party shall promptly provide
      full details to the other Party, and the Parties shall discuss the best
      way to respond.

            


    

     

    
      	
               
      

            	
              2.

            	
              The
      Licensee shall have the right but not the obligation to defend such suit
      and shall have the right to settle with such third party, provided that if
      any action or proposed settlement involves the making of any statement,
      express or implied, concerning the validity of any Patents, the consent of
      the Owner must be obtained before taking such action or making such
      settlement.

            


    

     

    
      	
               
      

            	
              3.

            	
              The
      Licensee shall be entitled to deduct from royalties payable under this
      Agreement any sums paid to third parties (including without limitation
      damages, payments in settlement of litigation and royalty payments) and
      costs and expenses incurred in relation to any alleged or actual
      infringement of third party rights in the manufacture, use or sale of any
      Licensed Product.

            


    

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      
        	
              	
                5.

              	
                Warranties and
      liability

              


      

    

     

    
      
        	
              	
                1.

              	
                The
      Owner warrants, represents and undertakes to the Licensee as
      follows:

              


      

    

     

    
      	
               
      

            	
              a.

            	
              it
      is the exclusive legal and beneficial owner of all rights, title and
      interest in the Patents;

            


    

    
      	
               
      

            	
              b.

            	
              Schedule
      1 is a complete description of the invention (as at the date of this
      Agreement) and of other intellectual property of which the Owner is aware
      relating to the Invention;

            


    

    
      	
               
      

            	
              c.

            	
              The
      Owner is entitled to license the Patents to the Licensee and has not
      previously entered into any agreement relating to them or to the
      Invention, which might affect its ability to license the Patents to the
      Licensee in accordance with the provisions of this Agreement or enter into
      this Agreement or which would be inconsistent with the Owner’s warranties
      and obligations under this
Agreement;

            


    

     

    
      
        	
              	
                d.

              	
                It
      is registered as the proprietor of the Patents (or, in the case of patent
      applications, as the applicant), all registrations and filings necessary
      to preserve the rights of the Owner have been made and are in good
      standing, and the Owner has not done or omitted to do anything which may
      cause the Patents to lapse prematurely or be the subject of a compulsory
      licence; 

              


      

      
        	
              	
                e.

              	
                It
      is not aware of any allegation or claim that it is not entitled to the
      Patents or to be registered as the exclusive owner of
  them;

              


      

      
        	
              	
                f.

              	
                The
      Patents are or will be upon grant valid and
  enforceable;

              


      

      
        	
              	
                g.

              	
                There
      are no allegations or proceedings, pending or threatened, which assert
      that development, manufacture, use or sale of any Licensed Product
      infringes or will infringe third party rights or which challenge the
      validity or enforceability of the
Patents;

              


      

    

     

    
      
        	
              	
                2.

              	
                No other
      warranties

              


      

    

     

    
      	
               
      

            	
              1.

            	
              Each
      of the Licensee and the Owner acknowledges that, in entering into this
      Agreement, it does not do so in reliance on any representation, warranty
      or other provision except as expressly provided in this Agreement, and any
      conditions warranties or other terms implied by statute or common law are
      excluded from this Agreement to the fullest extent permitted by
      law.

            


    

     

    
      	
               
      

            	
              2.

            	
              Without
      limiting the scope of clause 5.2.1, the Owner does not give any warranty,
      representation or undertaking:

            


    

     

    
      	
              a.

            	
              as
      to the efficacy or usefulness of the Patents;
or

            


    

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      	
              b.

            	
              that
      any of the Patents are or will be valid or subsisting or (in the case of
      an application) will proceed to
grant.

            


    

     

    
      	
               
      

            	
              3.

            	
              Indemnity

            


    

     

    The
Licensee shall indemnity the Owner against any loss, damages, costs or expenses
which are awarded against or incurred by the Owner as a result of any claim or
threatened claim concerning the use by the Licensee or any of its sub-licensees
of the Patents or otherwise in connection with the manufacture, use or sale of
or any other dealing in any of the Licensed Products by Licensee or any of its
sub-licensees.

     

    
      	
              6.

            	
              Duration and
      Termination

            


    

     

    
      	
               
      

            	
              1.

            	
              Commencement and Termination
      by Expiry

            


    

     

    This
Agreement, and the licences granted hereunder, shall come into effect on the
Commencement Date and, unless terminated earlier in accordance with this clause
6, shall continue in force on a country by country basis until the date on which
all the Patents have expired or been revoked without a right of further appeal,
and on such date this Agreement and the licences granted hereunder shall
terminate automatically by expiry.

     

    
      	
               
      

            	
              2.

            	
              Early
      termination

            


    

     

    
      	
               
      

            	
              1.

            	
              The
      owner and Licensee may only terminate this agreement in writing signed by
      duly authorised representatives of the Owner and the
    Licensee.

            


    

     

    
      	
               
      

            	
              2.

            	
              The
      Owner may terminate this Agreement if an external administrator or
      controller is appointed to control the Licensee (irrespective of whether
      the appointment is voluntary or on an Order by a Court or an authorised
      regulatory body), or the Licensee becomes insolvent, or the Licensee seeks
      protection from its creditors under any Federal or State insolvency law
      enacted in the United States of
America.

            


    

     

    
      	
              7.

            	
              General

            


    

     

    
      	
               
      

            	
              1.

            	
              Force
      majeure

            


    

    Neither
Party shall have any liability or be deemed to be in breach of this Agreement
for any delays or failures in performance of this Agreement which result from
circumstances beyond the reasonable control of that Party, including without
limitation labour disputes involving that Party.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      	
               
      

            	
              2.

            	
              Amendment

            


    

    This
Agreement may only be amended in writing signed by duly authorised
representatives of the Owner and the Licensee.

     

    
      	
               
      

            	
              3.

            	
              Assignment and third party
      rights

            


    

     

    Neither
party shall assign, mortgage, charge or otherwise transfer any rights or
obligations under this Agreement, nor any of the Patents or rights under the
Patents, without the prior written consent of the other Party.

     

    
      	
               
      

            	
              4.

            	
              Waiver

            


    

    No
failure or delay on the part of either Party to exercise any right or remedy
under this Agreement shall be construed or operate as a waiver thereof, nor
shall any single or partial exercise of any right or remedy preclude the further
exercise of such right or remedy.

     

    
      	
               
      

            	
              5.

            	
              Invalid
      clauses

            


    

    If any
provision or party of this Agreement is held to be invalid or unenforceable,
this Agreement shall be deemed to be amended by the addition or deletion of
wording as appropriate to remove the invalid part or provision but otherwise to
retain the provision and the other provisions of this Agreement to the maximum
extent permissible under applicable law.

     

    
      	
               
      

            	
              6.

            	
              No-agency

            


    

    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.

     

    
      	
               
      

            	
              7.

            	
              Interpretation

            


    

    In this
Agreement:

    
      	
              a.

            	
              the
      headings are used for convenience only and shall not affect its
      interpretation;

            


    

    
      	
              b.

            	
              references
      to persons shall include incorporated and unincorporated persons;
      reference to the singular include the plural and vice versa; and
      references to the masculine include the
  feminine.

            


    

     

    
      	
               
      

            	
              8.

            	
              Notices

            


    

    Any
notice to be given under this Agreement shall be in writing and shall be sent by
first class mail or air mail, or by fax (confirmed by first class mail or air
mail), to the address of the relevant Party, or to the relevant fax number
utilised by the relevant Party.

     

    
      	
               
      

            	
              9.

            	
              Law and
      Jurisdiction

            


    

    The
validity, construction and performance of this Agreement shall be governed by
the law of Queensland, Australia.

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      	
            	
              10.

            	
              Further
      action

            


    

     

    Each
Party agrees to execute, acknowledge and deliver such further instruments, and
do all further similar acts, as may be necessary or appropriate to carry out the
purposes and intent of this Agreement.

     

    
      	
            	
              11.

            	
              Entire
      agreement

            


    

    This
Agreement, including its Schedules, sets out the entire agreement between the
Parties relating to its subject matter and supersedes all prior oral or written
agreements, arrangements or understandings between them relating to such subject
matter. The parties acknowledge that they are not relying on any representation,
agreement, term or condition which is not set out in this
Agreement.

     

    
      	
            	
              12.

            	
              This
      agreement is a deed.

            


    

     

    IN
WITNESS the Parties hereto have duly executed this Agreement on the date first
above written:

    


    
      
        	
                EXECUTED
      BY

              	 
      	 
      	 
      	 
      
	
                MANTHEY
      REDMOND CORPORATION

              	 
      	 
      	 
      	 
      
	 
      	
                )

              	 
      	 
      	 
      
	
                By
      its duly authorised officer

              	 
      	
                )

              	 
      	
                Steven
      Charles Manthey- President

              
	 
      	 
      	 
      	 
      	 
      
	
                EXECUTED
      BY

              	 
      	 
      	 
      	 
      
	
                MANTHEY
      REDMOND (Aust)

              	 
      	 
      	 
      	 
      
	
                PTY
      LTD

              	 
      	
                )

              	 
      	 
      
	
                by
      its duly authorised officer

              	 
      	 
      	
                )

              	
                Steven
      Charles Manthey- Director

              


      

    

    


    SCHEDULE
1

     

    The
Linear Convergent Engine invented by Steven Charles Manthey