Lexaria Bioscience Corp. - Exhibit 10.1 - Filed by newsfilecorp.com






Exhibit 10.1 

INTELLECTUAL PROPERTY LICENSE
#2018CD01



            This
document certifies that an Intellectual Property License dated as of January 25,
2018 has been granted by:

Lexaria CanPharm Corp., a Canadian corporation with
offices at 156 Valleyview Rd, Kelowna, British Columbia, V1X 3M4, Canada
(“Licensor”, “Lexaria”, “us”, “our”,
“we”),

To: 

Cannfections Group Inc., a Canadian corporation with
offices at 4810 Jean Talon West, Suite 101, Montreal, Quebec (together with its
successors and assigns “CANNFECTIONS”, “Licensee”, “you”,
“your”).

RECITALS 

            WHEREAS
certain capitalized terms not otherwise defined below are defined in Exhibit
“D” herein; 

            WHEREAS,
LICENSEE intends, directly or indirectly through a partner, as further
contemplated in Section 1a) below, to be engaged in the business of developing,
manufacturing, and selling marijuana-infused products pursuant to license(s) to
be issued by Health Canada (“HC”), pursuant to regulations promulgated
thereby; 

            WHEREAS,
LICENSOR owns and holds, and will make improvements from time to time, on
certain intellectual property and technology (“Technology”) related to,
including but not limited to, the development, testing, and manufacturing
process for marijuana-infused products, which Technology is more specifically
described in Exhibit “A” and detailed batch records and formulation
calculation spreadsheets that shall be provided by email prior to the execution
of this License Agreement, by LICENSOR to LICENSEE; 

            WHEREAS,
LICENSEE wishes to utilize the Technology (which shall include any Licensor
Improvements developed during the term of this Agreement) of LICENSOR, and
LICENSOR desires for LICENSEE to utilize the Technology, to create, test,
manufacture and sell cannabinoid-infused edible chocolate and gummy-candy
products using derivatives of the marijuana plant to create any one or more
consumable products at the LICENSEE’s option as further described in Exhibit
“B” (“End Products”), subject to the terms and conditions set forth
herein. Such End Products shall only be distributed and/or sold by LICENSEE or
Partner, as defined in Section 1a) below, in compliance with all HC, local and
provincial licensing requirements applicable to the cannabis industry within
Canada or in any other location in which LICENSEE is permitted by this Agreement
or an addendum to this Agreement to sell or distribute the End Products (such
locations collectively referred to as “Permitted Locations” or
“Territory”);

            NOW,
THEREFORE, in consideration of the promises and the respective covenants and
agreements of the parties contained in this Agreement, the Parties hereto agree
as follows: 




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LICENSE 

	1. 	
      License of Technology: Subject to certain terms
      and conditions, LICENSOR hereby grants to LICENSEE each of the licenses
      more fully defined in Section 2 below.




	 	a) 	
      Non-transferable: The license granted by this
      Section 1 may not be transferred or sublicensed by LICENSEE without
      LICENSOR’s written consent. However, LICENSEE has the right to sublicense
      its license to any entity within the CANNFECTIONS Group.

	 	 	 
	 	b) 	
      Other Products: The Parties agree that LICENSEE is
      not limited to production of the End Products defined herein, but that
      LICENSEE may develop, create and test new products that are derived from
      or otherwise incorporate the Technology and such new products are only to
      be distributed and/or sold to Permitted Locations (the “New Products”),
      subject to availability of licenses in the future from Lexaria
      CanPharm.




	2) 	
      Semi-exclusive and Exclusive Licenses and License
      Option. LICENSEE will have the following rights to produce and sell
      the End Products for SEVEN (7) years in the Territory, using the
      Technology licensed pursuant to this
Agreement.




	 	a) 	
      In the Territory From LICENSOR to
      LICENSEE:



	 	i) 	
      Exclusive rights throughout the Initial Term and
      any renewals or extensions thereof, granting LICENSEE the exclusive right
      to manufacture all Lexaria-branded End Products contracted production both
      directly on behalf of Lexaria, and all Lexaria-sourced third-party
      contracted production originating from all US-based Lexaria-contracted
      clients who request branded End Product production within Canada. The term
      “Exclusive”, for the purposes of this subsection, means that LICENSOR will
      not engage or contract with any person or entity other than LICENSEE to
      contract manufacture Lexaria-branded End Products within Canada; and also
      means LICENSOR will not offer its Technology to any US-based brand
      expanding to Canada, unless said US-based brand engages LICENSEE to
      contract manufacture the US-based brand End Products within
  Canada.

	 	 	 
	 	ii) 	
      In the Territory From LICENSEE to
      LICENSOR:

	 		
      Exclusive rights throughout the Initial Term and
      any renewals or extensions thereof, granting LICENSOR the exclusive right
      to represent LICENSEE for purposes of contracted production within the
      Territory to all US-based Lexaria-contracted clients who request branded
      End Product production within Canada.

	 	 	 
	 	iii) 	
      In the Territory From LICENSOR to
      LICENSEE:

	 		
      Subject to the Exclusive rights hereinabove described,
      the LICENSEE shall also have Semi-exclusive rights throughout the
      Initial Term and any renewals or extensions thereof, to manufacture the
      End Products directly or through its Partner in the Territory, it being
      understood that no more than four (4) other Semi-exclusive licenses for
      the manufacturing of such End- Products in the Territory may be accorded
      by LICENSOR. The term “Semi-exclusive”, for the purposes of this
      subsection, means that LICENSOR will not permit more than five (5) such
      licenses at any time for the End Products utilizing its Technology to be
      granted within the Territory, including the license granted to LICENSEE,
      and its named Partner(s), if so named, as provided in Section 1a), under
      this Agreement. The license granted to CANNFECTIONS and its affiliates,
      partner and/or subsidiary(ies), constitutes a single license for the
      purpose of calculating the five (5) semi-exclusive licenses available in
      Canada.




	 	b) 	
      Licensee Option: Furthermore, until January
      1, 2020, LICENSOR will reserve one license in each of California, Oregon,
      Colorado and Nevada for the benefit of LICENSEE to be semi-exclusive
    in the case of the End Products, to distribute and/or sell
      End Products in locations compliant with all local and state laws
      applicable therein; under this option arrangement (the “License
      Option”). LICENSEE does hereby agree to a license of the Technology
      for each state into which it has exercised the License Option that is
      substantially similar to this Agreement (“Subsequent License
      Agreement”). Each Subsequent License Agreement shall have a term of
      not less than three (3) years from the date of signing the Subsequent
      Agreement. All such Subsequent License Agreements shall follow to the
  greatest extent possible the same terms of this Agreement.








- 3 - 

	 	c) 	
      Labels and Advertising: It is a
      condition of the license granted to the LICENSEE, that, subject to
      applicable law and subject to local language laws in any given
      jurisdiction, on the label of each End Product that uses the Technology
      shall be printed words to the effect, “Powered by Lexaria Bioscience” with
      a copy of the Lexaria pinwheel logo, in a type size large enough to be
      readable by persons with average vision. In return, LICENSOR agrees to
      enter trade advertisements within the Territory utilizing the “Powered by
      Lexaria Bioscience” concept.





	3) 	
      Rights and Obligations Related to the Technology.
      Except as expressly provided in this section or elsewhere in this
      Agreement, neither Party will be deemed by this Agreement to have been
      granted any license or other rights to the other Party’s products,
      information or other intellectual property rights, either expressly or by
      implication, estoppel or otherwise.




	 	a) 	
      LICENSOR Intellectual Property: LICENSOR
      retains full, absolute, and complete rights to all processes covered or
      described in all of its issued patents and its patent applications filed
      prior to the date of this Agreement, and any future continuations,
      continuations in part or divisional applications filed thereto, including
      but not limited to the US Provisional patent applications, US Utility
      patent application, and the International patent application, that
      comprise the Technology (“Licensor IP”), unless LICENSOR allows
      these applications to abandon or lapse, or otherwise fails to protect the
      Technology. Except as expressly provided for in Section 2, nothing in this
      Agreement or in the conduct of the Parties shall be interpreted as
      preventing LICENSOR from granting to any other person a license for use of
      the Technology or from using the Technology in any manner
    whatsoever.

	 	 	 
	 	b) 	
      LICENSEE Intellectual Property: Any
      intellectual property resulting solely from LICENSEE’s work, know-how, or
      development that does not include nor rely upon the Technology,
      Licensor IP or jointly owned intellectual property, as described in this
      Agreement, shall be owned by LICENSEE (“Licensee IP”).

	 	 	 
	 	c) 	
      Improvements:




	 	i) 	
      LICENSOR Improvements: The entire right and title
      to the Technology, whether or not patentable, and any patent applications
      or patents based thereon, which directly relate to and are not severable
      from LICENSOR IP and which are improvements thereto by LICENSOR, its
      employees or others acting solely on LICENSOR’s behalf shall be owned
      solely by LICENSOR (“Licensor Improvements”).

	 	ii) 	
      LICENSEE Improvements: Rights and title to
      improvements whether or not patentable, and any patent applications or
      patents based thereon, which directly relate to and are not severable from
      LICENSOR IP and which are improvements thereto by LICENSEE, its employees
      or its Partner, as defined by this Agreement, shall be owned by the
      LICENSEE (“Licensee Improvements”). In respect to such Licensee
      Improvements, LICENSOR grants LICENSEE a license to use the underlying
      intellectual property supporting any such improvement for so long as this
      Agreement remains in effect (including any renewal terms) and LICENSOR
      agrees to negotiate in good faith terms of license renewal after the end
      of the Term of this Agreement and any renewal terms per Section 4a). If
      LICENSEE develops any Licensee Improvements, LICENSEE will promptly
      provide LICENSOR with written notice of such Licensee Improvements to
      validate LICENSEE’S claim to Licensee Improvements. Following receipt of
      notice of such Licensee Improvements, LICENSOR shall have the exclusive
      option during the Term of this Agreement







- 4 - 

	 		
      (and any renewal terms) to purchase or license from
      LICENSEE the Licensee Improvements for LICENSOR’s use upon mutually
      agreeable terms and conditions that the parties shall negotiate in good
      faith. LICENSOR recognizes that LICENSEE Improvements shall survive the
      term of this Agreement.

	 	iii) 	
      Joint Improvements: Rights and title to the
      Technology, whether or not patentable, and any patent applications or
      patents based thereon, which directly relate to and are not severable from
      LICENSOR IP and which are improvements thereto by both LICENSOR AND
      LICENSEE shall be jointly owned intellectual property by LICENSOR AND
      LICENSEE.

	 	iv) 	
      Improvements; Assignment. LICENSEE and LICENSOR
      hereby represent that all Partners, employees and other persons acting on
      its behalf in performing its obligations under this Agreement shall be
      obligated under a binding written agreement to assign, or as it shall
      direct, all Joint Improvements that include or rely on the Technology
      conceived or reduced to practice by such Partners, employees or other
      persons acting on its behalf in accordance with this Agreement to the
      benefit of LICENSOR and LICENSEE.

	 	v) 	
      Improvements; Confidential Information. All
      Improvements shall constitute Confidential Information and shall be
      subject to the confidentiality provisions set forth in this Agreement, the
      whole subject to this Section 3.




	 	d) 	
      Inventions;
Reporting:




	 	i) 	
      Upon making any invention that does not include or
      rely upon the Technology LICENSEE has no obligation to share such
      information of invention with LICENSOR nor inform LICENSOR of said
      invention, and LICENSEE retains unrestricted rights and ability to use,
      assign, license, seek patent and other forms of intellectual property
      protection related to said invention. For greater certainty, any such new
      invention, development, technology, and/or intellectual property belongs
      solely to LICENSEE. Upon making any invention that does or does NOT
      include or rely upon the Technology, LICENSOR has no obligation to share
      such information of invention with LICENSEE nor inform LICENSEE of said
      invention, and LICENSOR retains unrestricted rights and ability to use,
      assign, license, seek patent and other forms of intellectual property
      protection related to said invention.




	 	e) 	
      Jointly Owned Intellectual Property: If any
      patent applications are filed seeking to protect any Joint Improvements
      (“Jointly Owned IP”), each Party shall be named as joint
      inventors.




	 	i) 	
      Prosecution and Maintenance of Jointly Owned
      Patents. The Parties shall cooperate to cause the filing of one or
      more patent applications covering any such Jointly Owned IP. The Parties
      will mutually agree upon which of them shall be responsible for filing,
      prosecution and maintenance of Jointly Owned IP. The expenses of such
      filing, prosecution and maintenance shall be equally shared by the Parties
      unless one of the Parties assigns all of its rights to the other Party.
      Both Parties agree to assist the other Party in enforcing its rights in
      the Jointly Owned IP. The costs of any such assistance or cooperation will
      be borne by the requesting party.

	 	ii) 	
      Jointly Owned IP Rights. LICENSOR grants to
      LICENSEE an exclusive, non-sub-licensable, fully-paid, royalty-free,
      perpetual license to any Jointly Owned IP. Further, LICENSEE grants to
      LICENSOR an exclusive, non-sub-licensable, fully-paid, royalty-free,
      perpetual license to any Jointly Owned IP. In the event of a “Change in
      Control” of a party hereto, or in the event of the “Sale of Assets” (as
      such terms are defined in Section 30) of a party, then Section 30 shall
      apply.




	 	f) 	
      Quality
Control.



	 	i) 	
      LICENSEE agrees to maintain and preserve the quality of
      the Technology, and to use the Technology in good faith and in a manner
      consistent with the uses approved herein.

	 	ii) 	
      LICENSEE shall (a) ensure that all End Products and
      related materials under the Technology are developed, tested, promoted,
      manufactured and distributed in a professional manner in compliance with
      all generally accepted industry standards, and (b) comply in all
      material respects with any and all laws, rules
and regulations that are applicable to the development, testing, promotion,
manufacture and distribution of the End Products and such related materials.








- 5 - 

	4) 	
      Term and Termination.




	 	a) 	
      Term. This Agreement shall take effect on January
      1, 2018, and shall remain in effect for the shorter of either SEVEN (7)
      years (namely until December 31, 2024) (the “Initial Term”); or,
      such circumstances as described in Section 4c).

	 	 	 
	 		
      After the conclusion of the Initial Term, this Agreement
      may be renewed by LICENSEE for an additional period of five (5) years on
      terms to be negotiated in good faith by the Parties. If LICENSOR abandons
      all patent applications or fails to exercise its right to file an
      application for the provisional patents, LICENSOR shall immediately notify
      LICENSEE. In the event of such actions by LICENSOR, and where LICENSOR
      fails to protect the Technology through some means other than a patent,
      LICENSEE shall retain the right to immediately terminate the
    Agreement.

	 	 	 
	 	b) 	
      Termination. This Agreement and the licenses
      granted hereunder may be terminated prior to the expiration of the Initial
      Term or any renewal term of this Agreement as
follows:




	 	i) 	
      This Agreement may be terminated by LICENSOR by written
      notice to LICENSEE upon the occurrence of any of the following: (i)
      LICENSEE’s violation of the provisions of Section 6 or LICENSEE’s material
      breach of any other term of this Agreement, and if which breach is not
      cured within sixty (60) days after written notice of such breach from
      LICENSOR; (iii) failure of LICENSEE to maintain all required licenses and
      governmental authorizations required for the conduct of its business or to
      comply in all material respects with applicable laws; or (iv) LICENSEE
      ceases operations, makes a general assignment for the benefit of
      creditors, or is the subject of a voluntary or involuntary bankruptcy,
      insolvency or similar proceeding.

	 	ii) 	
      This Agreement may be terminated by LICENSEE by written
      notice to LICENSOR in the event of material breach by LICENSOR of its
      obligations or representations and warranties under this Agreement, and if
      which breach is not cured within sixty (60) days after written notice of
      such breach from LICENSEE.

	 	iii) 	
      This Agreement may be terminated by either party by
      written notice upon either the withdrawing of a Health Canada cannabis
      license application by the LICENSEE or by any final notice from Health
      Canada to LICENSEE of the inability of LICENSEE to obtain a Health Canada
      cannabis license.




	 	c) 	
      Effect of Termination. If the Agreement expires
      without any renewal thereof, and LICENSOR has not been granted patents for
      the Technology then LICENSEE must immediately cease and desist all
      utilization of the Technology to manufacture, distribute or sell End
      Products, except that it may distribute and sell End Products until all
      finished goods and raw materials inventory that pertains to the Technology
      has been sold. In any event, upon the natural future expiration of all
      pending and issued patents related to the Technology described herein, as
      applicable, the License Agreement shall expire and LICENSEE shall have no
      further obligations to LICENSOR.




	5) 	
      Indemnification.




	 	a) 	
      LICENSEE agrees to indemnify LICENSOR and hold LICENSOR
      harmless from and against any and all liabilities, losses and expenses
      arising from (i) LICENSEE’s unauthorized use of the Technology; (ii)
      LICENSEE’s failure to comply with applicable laws or to maintain all
      required licenses and governmental authorizations; (iii) any breach of
      LICENSEE’s representations and warranties set forth herein; and (iv) any
      liability to third parties as a result of LICENSEE’s production,
      distribution and/or sale of End Products, except as to any liability
      arising out of the proper use of the
Technology.







- 6 - 

	 	b) 	
      LICENSOR agrees to indemnify LICENSEE and hold LICENSEE
      harmless from and against any and all liabilities, losses and expenses
      arising from (i) any breach of LICENSOR’s representations and warranties
      set forth herein; and (ii) any claims of infringement raised by third
      parties as to the Technology or Licensed Patents.



6)       
Confidentiality. In addition to the Confidentiality Agreement
previously entered into by the Parties, at all times during the term of this
Agreement (including any renewal term) and thereafter, LICENSEE will not use or
disclose and will otherwise keep confidential any trade secrets or proprietary
information, including, but not limited to the Technology and other intellectual
property of LICENSOR (collectively, the “Confidential Information”)
except to the extent required to perform its obligations under this Agreement.
Without limitation of the foregoing, LICENSEE will hold the Confidential
Information in confidence and will (a) exercise the same degree of care, but no
less than a reasonable degree of care, to prevent its disclosure as LICENSEE
would take to safeguard its own confidential or proprietary information, and (b)
limit disclosure of Confidential Information, including any notes, extracts,
analyses or materials that would disclose Confidential Information, solely to
those of its employees who need to know the information for purposes of
performing its obligations under this Agreement and who agree to keep such
information confidential. Upon termination of this Agreement, LICENSEE shall
immediately return all Confidential Information to LICENSOR and LICENSOR shall
have the right to conduct an on-site audit of the LICENSEE within three (3)
business days of termination to ensure compliance with the terms of this
Agreement, at LICENSOR’S expense. 

a. Limitations. This section
does not apply to any information that: (a) is already lawfully in the receiving
Party's possession (unless received pursuant to a nondisclosure agreement); (b)
is or becomes generally available to the public through no fault of the
receiving Party; (c) is disclosed to the receiving Party by a third party who
may transfer or disclose such information without restriction; (d) is required
to be disclosed by the receiving Party as a matter of law (provided that the
receiving Party will use all reasonable efforts to provide the disclosing Party
with prior notice of such disclosure and to obtain a protective order therefor,
with all costs to be borne by the disclosing Party); (e) is disclosed by the
receiving Party with the disclosing Party's approval; or (f) is independently
developed by the receiving Party without any use of confidential information. In
all cases, the receiving Party will use all reasonable efforts to give the
disclosing Party ten (10) days' prior written notice of any disclosure of
information under this Agreement. The Parties will maintain the confidentiality
of all confidential and proprietary information learned pursuant to this
Agreement for a period of ten (10) years from the date of termination of this
Agreement.

b. Saving Provision. The Parties
agree and stipulate that the agreements contained in this Section are fair and
reasonable in light of all of the facts and circumstances of their relationship;
however, the Parties are aware that in certain circumstances courts have refused
to enforce certain agreements. Therefore, in furtherance of and not in
derogation of the provisions of the preceding paragraph the parties agree that
in the event a court should decline to enforce the provisions of the preceding
paragraph, that paragraph shall be deemed to be modified to restrict
non-enforcing Party’s rights under this Agreement to the maximum extent, in both
time and geography, which the court shall find enforceable.

	7) 	
      Limitation of Liability. EXCEPT TO THE EXTENT
      OTHERWISE EXPRESSLY AGREED TO IN THIS AGREEMENT, NEITHER PARTY SHALL BE
      LIABLE TO THE OTHER PARTY FOR LOST PROFITS OR FOR ANY DIRECT, INDIRECT,
      INCIDENTAL, CONSEQUENTIAL, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES IN
      CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS
      AGREEMENT, HOWEVER CAUSED, UNDER ANY THEORY OF LIABILITY. THE FOREGOING
      SHALL NOT LIMIT LICENSEE’S LIABILITY FOR UNAUTHORIZED USE BY LICENSEE OF
      LICENSOR’S TECHNOLOGY.







- 7 - 

		
      a) 
	
      No Warranties. OTHER THAN THE EXPRESS WARRANTIES
      PROVIDED HEREIN, LICENSOR MAKES NO EXPRESS WARRANTIES OF
      MERCHANTABILITY OR FITNESS OR EFFICACY FOR A PARTICULAR PURPOSE OF THE
      TECHNOLOGY AND/OR ANY END PRODUCTS PRODUCED FROM SAID TECHNOLOGY AND SHALL
      NOT BE HELD LIABLE FOR PROFITABILITY OF TECHNOLOGY AND/OR END PRODUCTS OR
      HELD LIABLE UNDER ANY OTHER THEORY OF LIABILITY.



      
     NOW, THEREFORE, in consideration of the premises
and the mutual promises and conditions hereinafter set forth, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties, do hereby agree. 

       IN WITNESS
WHEREOF, Lexaria CanPharm Corp has granted this license. 

 

“LICENSOR” 
LEXARIA CANPHARM CORP. 

 

/s/ Chris Bunka, CEO




EXHIBIT “A” 

TECHNOLOGY 

The Technology consists of: 

(1) the following patent applications,
patents granted, and PCT International Patent Applications; (2) all technical
know-how and trade secrets in regard to such named patents, including the use,
manufacture or formulation thereof, that is owned or controlled by LICENSOR as
of the Effective Date of this Agreement, as well as any future continuations,
continuations in part or divisional applications filed pursuant to the patent
applications. (the “Licensed Patents”): 

	U.S. Patent Granted No. 9,474,725 awarded October 27, 2016.
    
	 
	U.S. Patent Granted No. 9,839,612 B2 awarded December 12,
      2017 
	 
	U.S. Provisional Patent Application No. 62/010,601. 
	 
	U.S. Provisional Patent Application No. 62/037,706. 
	 
	U.S. Provisional Patent Application No. 62/153,835. 
	 
	U.S. Provisional Patent Application No. 62/161,324. 
	 
	U.S. Provisional Patent Application No. 15/225,802. 
	 
	U.S. Provisional Patent Application No. 62/264,959. 
	 
	U.S. Provisional Patent Application No. 62/264,967. 
	 
	U.S. Utility Patent Application No. 14/735,844. 
	 
	PCT International Patent Application No. PCT/US15/35128.
  
	 
	PCT International Patent Application No. PCT/US16/64295.
  
	 
	PCT International Patent Application No. PCT/US16/64296.
  
	 
	National filings thereunder: 
	2949369, 
	201580031524.X, 
	15806768.6, 
	201647041745.00 
	516371405 
	 
	Australian Patent Granted No. 2015274698 awarded June 15,
      2017 






EXHIBIT “B” 

END PRODUCTS 

At LICENSEE’S option, any one or more of: 


	
      Product Line Name 
	
      Product Line Description 

	
      Chocolate Products 
	
      Any product that is generally recognized as “chocolates,”
      “chocolate bars,” “chocolate treats (including chocolate baked goods),”
      “chocolate truffles,” “caramels,” “chocolate caramels,” “caramel treats,”
      or primarily composed of a form of chocolate or cocoa, including that
      which is infused with marijuana oil. 

	
      Candies Product Line 
	
      All products that are not Chocolates but are generally
      recognized as “candies,” “gummies and jellies,” “suckers,” “hard or rock
      candies,” “jelly beans”, etc, that are primarily made with sugar and or
      other sweeteners and not generally recognized as a natural food and is
      infused with marijuana oil.