Document:

ex101.htm

EXHIBIT 10.1

 

INDEMNIFICATION AGREEMENT

 

This Indemnification Agreement, dated as of September 27, 2011, is made by and between China Chemical Corp., a Delaware corporation (the “Company”) and ________________ (the “Indemnitee”).

RECITALS

A.           The Company recognizes that competent and experienced persons are increasingly reluctant to serve or to continue to serve as directors or officers of corporations unless they are protected by comprehensive liability insurance or indemnification, or both, due to increased exposure to litigation costs and risks resulting from their service to such corporations, and due to the fact that the exposure frequently bears no reasonable relationship to the compensation of such directors and officers;

 

B.           The statutes and judicial decisions regarding the duties of directors and officers are often difficult to apply, ambiguous, or conflicting, and therefore fail to provide such directors and officers with adequate, reliable knowledge of legal risks to which they are exposed or information regarding the proper course of action to take;

 

C.           The Company and Indemnitee acknowledge that, as of the date of this Agreement, the Company is in a process of a proposed business combination with an entity to be formed by the certain stockholders which will result in the Company’s no longer being a public company in the United States but becoming a private company;

 

D.           The Company and Indemnitee recognize that in case of any shareholder or derivative litigation against the Company or its officers and directors, plaintiffs might seek damages in such large amounts and the costs of litigation may be so enormous (whether or not the case is meritorious), that the defense and/or settlement of such litigation is often beyond the personal resources of directors and officers;

 

E.           The Company recognizes that it is unfair for its directors and officers to assume the risk of large judgments and other expenses which may occur in cases in which the director or officer received no personal profit and in cases where the director or officer was not culpable;

 

F.           Section 145 of the DGCL (“Section 145”), under which the Company is organized, empowers the Company to indemnify its officers, directors, employees and agents by agreement and to indemnify persons who serve, at the request of the Company, as the directors, officers, employees or agents of other corporations or enterprises, and expressly provides that the indemnification provided by Section 145 is not exclusive;

 

G.         The Board of Directors has determined that contractual indemnification as set forth herein is not only reasonable and prudent but also promotes the best interests of the Company and its stockholders;

 

  

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H.           The Company desires and has requested Indemnitee to serve or continue to serve as a director or officer of the Company free from undue concern for unwarranted claims for damages arising out of or related to such services to the Company; and

 

I.           Indemnitee is willing to serve, continue to serve or to provide additional service for or on behalf of the Company on the condition that he or she is furnished the indemnity provided for herein.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

AGREEMENT

 

1. Defined Terms; Construction.

 

(a) Defined Terms.  As used in this Agreement, the following terms shall have the following meanings:

 

“DGCL” means the General Corporation Law of the State of Delaware, as amended from time to time.

 

“Change in Control” means, and shall be deemed to have occurred if, on or after the date of this Agreement, (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)), other than (A) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its subsidiaries acting in such capacity, or (B) a corporation owned directly or indirectly by the shareholders of the Company in substantially the same proportions as their ownership of stock of the Company, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities of the Company representing more than 50% of the total voting power represented by the Company’s then outstanding Voting Securities, (ii) during any period of two (2) consecutive years commencing from and after the date hereof, individuals who at the beginning of such period constitute the board of directors of the Company and any new director whose election by the board of directors of the Company or nomination for election by the Company’s shareholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof, (iii) the effective date of a merger or consolidation of the Company with any other corporation other than a merger or consolidation that would result in the Voting Securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into Voting Securities of the surviving entity) more than 50% of the total voting power represented by the Voting Securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, (iv) the shareholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of (in one transaction or a series of related transactions) all or substantially all of its assets, or (v) the Company shall file or have filed against it, and such filing shall not be dismissed, any bankruptcy, insolvency or dissolution proceedings, or a trustee, administrator or creditors committee shall be appointed to manage or supervise the affairs of the Company.

 

  

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“Corporate Status” means the status of a person who is or was a director (or a member of any committee of a board of directors) or an officer of the Company, or of any predecessor thereof, or is or was serving at the request of the Company as a director (or a member of any committee of a board of directors, or in an equivalent role with respect to any such entity not organized as a corporation) or an officer of another corporation, limited liability company, partnership, joint venture, trust or other enterprise, or of any predecessor thereof, including service with respect to an employee benefit plan.

 

“Determination” means a determination that either (x) there is a reasonable basis for the conclusion that indemnification of Indemnitee is proper in the circumstances because Indemnitee met a particular standard of conduct (a “Favorable Determination”) or (y) there is no reasonable basis for the conclusion that indemnification of Indemnitee is proper in the circumstances because Indemnitee met a particular standard of conduct (an “Adverse Determination”).  An Adverse Determination shall include the decision that a Determination was required in connection with indemnification and the decision as to the applicable standard of conduct.

 

“Expenses” means all reasonable attorneys’ fees and expenses, retainers, court, arbitration and mediation costs, transcript costs, fees of experts, bonds, witness fees, costs of collecting and producing documents, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, appealing or otherwise participating in a Proceeding.

 

“Independent Legal Counsel” means an attorney or firm of attorneys competent to render an opinion under the applicable law, selected in accordance with the provisions of Section 5(e), who has not otherwise performed any services for the Company or any of its subsidiaries or for Indemnitee within the last three (3) years (other than with respect to matters concerning the rights of Indemnitee under this Agreement or under indemnity agreements similar to this Agreement).

 

“Proceeding” means a threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, including without limitation a claim, demand, discovery request, formal or informal investigation, inquiry, administrative hearing, arbitration or other form of alternative dispute resolution, including an appeal from any of the foregoing.

 

“Voting Securities” means any securities of the Company that vote generally in the election of directors.

 

(b) Construction.  For purposes of this Agreement:

 

(i) references to any of the Company or any of its “subsidiaries” shall include any corporation, limited liability company, partnership, joint venture, trust or other entity or enterprise that before or after the date of this Agreement is party to a merger or consolidation with any of the Company or any such subsidiary or that is a successor to any of the Company as contemplated by Section 8(d) (whether or not such successor has executed and delivered the written agreement contemplated by Section 8(d));

 

  

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(ii) references to “fines” shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and

 

(iii) references to a “witness” in connection with a Proceeding shall include any interviewee or person called upon to produce documents in connection with such Proceeding.

 

2. Agreement to Serve.

 

Indemnitee agrees to serve as a director or officer of the Company and in such other capacities as Indemnitee may serve at the request of the Company from time to time.  Indemnitee shall be entitled to resign or otherwise terminate such service with immediate effect at any time, and neither such resignation or termination nor the length of such service shall affect Indemnitee’s rights under this Agreement.  This Agreement shall not constitute an employment agreement, supersede any employment agreement to which Indemnitee is a party or create any right of Indemnitee to continued employment or appointment.

 

3. Indemnification.

 

(a) General Indemnification.  The Company shall indemnify Indemnitee to the fullest extent permitted by applicable law in effect on the date hereof or as amended to increase the scope of permitted indemnification, against Expenses, losses, liabilities, judgments, fines, penalties and amounts paid in settlement (including all interest, assessments and other charges in connection therewith) actually incurred by Indemnitee or on Indemnitee’s behalf in connection with any Proceeding in any way connected with, resulting from or relating to Indemnitee’s Corporate Status; provided, however, if applicable law provides, no indemnification against Expenses shall be made in respect of any claim, issue or matter in such Proceeding as to which Indemnitee shall have been adjudged to be liable to the Company unless and to the extent that the court presiding over such Proceeding shall determine that such indemnification may be made.

 

(b) Additional Indemnification Regarding Expenses.  Without limiting the foregoing, in the event any Proceeding is initiated by Indemnitee or the Company or any of its subsidiaries to enforce or interpret this Agreement or any rights of Indemnitee to indemnification or advancement of Expenses (or related obligations of Indemnitee) under the Company’s or any such subsidiary’s articles of incorporation or bylaws, any vote of shareholders or directors of the Company or any of its subsidiaries, the DGCL, any other applicable law or any liability insurance policy, the Company shall indemnify Indemnitee against all Expenses incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding, whether or not Indemnitee is successful in such Proceeding, except to the extent that the court presiding over such Proceeding determines that (i) material assertions made by Indemnitee in such Proceeding were in bad faith or were frivolous or (ii) as a matter of applicable law, such Expenses must be limited in proportion to the success achieved by Indemnitee in such Proceeding and the efforts required to obtain that success, as determined by the court presiding over such Proceeding.

 

  

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(c) Partial Indemnification.  If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for a portion of any Expenses, losses, liabilities, judgments, fines, penalties and amounts paid in settlement incurred by Indemnitee, but not for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for such portion.

 

(d) Nonexclusivity.  The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which Indemnitee may be entitled under the Company’s articles of incorporation or bylaws, any agreement, any vote of shareholders or directors, the DGCL, any other applicable law or any liability insurance policy, provided that to the extent that Indemnitee is entitled to be indemnified by the Company under this Agreement and by any shareholder of the Company or any affiliate of any such shareholder under any other agreement or instrument, the obligations of the Company hereunder shall be primary, and the obligations of such shareholder or affiliate secondary, and the Company shall not be entitled to contribution or indemnification from or subrogation against such shareholder or affiliate.

 

(e) Exceptions.  Any other provision herein to the contrary notwithstanding, the Company shall not be obligated under this Agreement to indemnify Indemnitee:

 

(i) for Expenses incurred in connection with Proceedings initiated or brought voluntarily by Indemnitee and not by way of defense, counterclaim or crossclaim, except (x) as contemplated by Section 3(b), (y) in specific cases if the board of directors of the Company has approved the initiation or bringing of such Proceeding and (z) as may be required by law;

 

(ii) for an accounting of profits arising from the purchase and sale by Indemnitee of securities within the meaning of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute;

 

(iii) if the Indemnitee, with respect to the matter out of which the claim for indemnification arises, did not act in good faith and in a manner the Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and with respect to any criminal Proceeding, had reasonable cause to believe Indemnitee’s conduct was unlawful; and

 

(iv) for any payments that have actually been made to or on behalf of Indemnitee under any Company insurance policy, except with respect to any excess beyond the amount paid under such Company insurance policy.

 

(f) Subrogation.  In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute such documents and do such acts as the Company may reasonably request to secure such rights and to enable the Company effectively to bring suit to enforce such rights, provided that the Company shall not be subrogated to any claim of Indemnitee for indemnification from any shareholder of the Company or any affiliate of any such shareholder.

 

  

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4. Advancement of Expenses.

 

Subject to the notice provisions of Section 5(c), the Company shall pay all Expenses incurred by Indemnitee in connection with any Proceeding in any way connected with, resulting from or relating to Indemnitee’s Corporate Status, other than a Proceeding initiated by Indemnitee for which the Company would not be obligated to indemnify Indemnitee pursuant to Section 3(e)(i), in advance of the final disposition of such Proceeding and without regard to whether Indemnitee will ultimately be entitled to be indemnified for such Expenses and without regard to whether an Adverse Determination has been made, except as contemplated by the last sentence of Section 5(f).  Indemnitee shall repay such amounts advanced if and to the extent that it shall ultimately be determined in a decision by a court of competent jurisdiction from which no appeal can be taken that Indemnitee is not entitled to be indemnified by the Company for such Expenses.  Such repayment obligation shall be unsecured and shall not bear interest.  The Company shall not impose on Indemnitee additional conditions to advancement or require from Indemnitee additional undertakings regarding repayment.

 

5. Indemnification Procedure.

 

(a) Notice of Proceeding; Cooperation.  Indemnitee shall give the Company notice in writing as soon as practicable of any Proceeding for which indemnification will or could be sought under this Agreement, provided that any failure or delay in giving such notice shall not relieve the Company of its obligations under this Agreement unless and to the extent that the Company is materially prejudiced by such failure.

 

(b) Settlement.  The Company will not, without the prior written consent of Indemnitee, which may be provided or withheld in Indemnitee’s sole discretion, effect any settlement of any Proceeding against Indemnitee or which could have been brought against Indemnitee unless such settlement solely involves the payment of money by persons other than Indemnitee and includes an unconditional release of Indemnitee from all liability on any matters that are the subject of such Proceeding and an acknowledgment that Indemnitee denies all wrongdoing in connection with such matters.  The Company shall not be obligated to indemnify Indemnitee against amounts paid in settlement of a Proceeding against Indemnitee if such settlement is effected by Indemnitee without the Company’s prior written consent, which may be provided or withheld in the Company’s sole discretion.

 

(c) Request for Payment; Timing of Payment.  To obtain indemnification payments or advances under this Agreement, Indemnitee shall submit to the Company a written request therefor, together with such invoices or other supporting information as may be reasonably requested by the Company and reasonably available to Indemnitee, and such written request shall include or be preceded or accompanied by a written undertaking by or on behalf of Indemnitee to repay any Expenses advanced if it shall ultimately be determined that Indemnitee is not entitled to be indemnified against such Expenses.  The Company shall make indemnification payments to Indemnitee no later than thirty (30) days, and advances to Indemnitee no later than ten (10) days, after receipt of the written request of Indemnitee.

 

(d) Determination.  The Company intends that Indemnitee shall be indemnified to the fullest extent permitted by law as provided in Section 3 and that no Determination shall be required in connection with such indemnification.  In no event shall a Determination be required in connection with advancement of Expenses pursuant to Section 4 or in connection with indemnification for Expenses incurred as a witness or incurred in connection with any Proceeding or portion thereof with respect to which Indemnitee has been successful on the merits or otherwise.  Any decision that a Determination is required by law in connection with any other indemnification of Indemnitee, and any such Determination, shall be made within thirty (30) days after receipt of Indemnitee’s written request for indemnification, as follows:

 

  

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(i) if no Change in Control has occurred, (x) by a majority vote of the directors of the Company who are not parties to such Proceeding, even though less than a quorum, with the advice of Independent Legal Counsel, or (y) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, with the advice of Independent Legal Counsel, or (z) if there are no such directors, or if such directors so direct, by Independent Legal Counsel in a written opinion to the Company, a copy of which shall be delivered to Indemnitee; and

 

(ii) if a Change in Control has occurred, by Independent Legal Counsel in a written opinion to the Company and Indemnitee.

 

The Company shall pay all Expenses incurred by Indemnitee in connection with a Determination.

 

(e) Independent Legal Counsel.  If there has not been a Change in Control, Independent Legal Counsel shall be selected by the board of directors of the Company and approved by Indemnitee (which approval shall not be unreasonably withheld or delayed).  If there has been a Change in Control, Independent Legal Counsel shall be selected by Indemnitee and approved by the Company (which approval shall not be unreasonably withheld or delayed).  The Company shall pay the reasonable fees and expenses of Independent Legal Counsel and indemnify Independent Legal Counsel against any and all expenses (including reasonable attorneys’ fees), claims, liabilities and damages arising out of or relating to its engagement.

 

(f) Consequences of Determination; Remedies of Indemnitee.  The Company shall be bound by and shall have no right to challenge a Favorable Determination.  If an Adverse Determination is made, or if for any other reason the Company does not make timely indemnification payments or advances of Expenses, Indemnitee shall have the right to commence a Proceeding before a court of competent jurisdiction to challenge such Adverse Determination and/or to require the Company to make such payments or advances.  Indemnitee shall be entitled to be indemnified for all Expenses incurred in connection with such a Proceeding in accordance with Section 3(b) and to have such Expenses advanced by the Company in accordance with Section 4.  If Indemnitee fails to timely challenge an Adverse Determination, or if Indemnitee challenges an Adverse Determination and such Adverse Determination has been upheld by a final judgment of a court of competent jurisdiction from which no appeal can be taken, then, to the extent and only to the extent determined by such Adverse Determination or final judgment, the Company shall not be obligated to indemnify or advance Expenses to Indemnitee under this Agreement.

 

  

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(g) Presumptions; Burden and Standard of Proof.  In connection with any Determination, or any review of any Determination, by any person, including a court:

 

(i) it shall be a presumption that a Determination is not required;

 

(ii) it shall be a presumption that Indemnitee has met the applicable standard of conduct and that indemnification of Indemnitee is proper in the circumstances;

 

(iii) the burden of proof shall be on the Company to overcome the presumptions set forth in the preceding clauses (i) and (ii), and each such presumption shall only be overcome if the Company establishes that there is no reasonable basis to support it;

 

(iv) the termination of any Proceeding by judgment, order, finding, settlement (whether with or without court approval) or conviction, or upon a plea of nolo contendere, or its equivalent, shall not create a presumption that indemnification is not proper or that Indemnitee did not meet the applicable standard of conduct or that a court has determined that indemnification is not permitted by this Agreement or otherwise; and

 

(v) neither the failure of any person or persons to have made a Determination nor an Adverse Determination by any person or persons shall be a defense to Indemnitee’s claim or create a presumption that Indemnitee did not meet the applicable standard of conduct, and any Proceeding commenced by Indemnitee pursuant to Section 5(f) shall be de novo with respect to all determinations of fact and law.

 

6. Directors and Officers Liability Insurance.

 

(a) The Company may purchase and maintain insurance on behalf of Indemnitee who is or was or has agreed to serve at the request of the Company as a director or officer of the Company against any liability asserted against, and incurred by, Indemnitee or on Indemnitee’s behalf in any such capacity, or arising out of Indemnitee’s status as such, whether or not the Company would have the power to indemnify Indemnitee against such liability under the provisions of this Agreement. If the Company has such insurance in effect at the time the Company receives from Indemnitee any notice of the commencement of a proceeding, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the policy.  The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policy.

(b) In the event of any payment by the Company under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee with respect to any insurance policy, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights in accordance with the terms of such insurance policy. The Company shall pay or reimburse all expenses actually and reasonably incurred by Indemnitee in connection with such subrogation.

 

  

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(c) The Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable hereunder (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) if and to the extent that Indemnitee has otherwise actually received such payment under this Agreement or any insurance policy, contract, agreement or otherwise.

7. Limitation of Liability.

 

(a) Limitation of Liability.  Indemnitee shall not be personally liable to the Company or any of its subsidiaries or to the shareholders of the Company or any such subsidiary for monetary damages for breach of fiduciary duty as a director of any of the Company or any such subsidiary; provided, however, that the foregoing shall not eliminate or limit the liability of Indemnitee (i) for acts or omissions of the Indemnitee that involve intentional misconduct or a knowing and culpable violation of law, (ii) for acts or omissions that the Indemnitee believes to be contrary to the best interests of the Company or its shareholders or that involve the absence of good faith on the part of the Indemnitee, (iii) for any transaction from which the Indemnitee derived an improper personal benefit, (iv) for acts or omissions that show a reckless disregard for the Indemnitee's duty to the Company or its shareholders in circumstances in which the Indemnitee was aware, or should have been aware, in the ordinary course of performing his or her duties, of a risk of serious injury to the Company or its shareholders, (v) for acts or omissions that constitute an unexcused pattern of inattention that amounts to an abdication of the Indemnitee's duty to the Company or its shareholders.  If the DGCL or such other applicable law shall be amended to permit further elimination or limitation of the personal liability of directors, then the liability of Indemnitee shall, automatically, without any further action, be eliminated or limited to the fullest extent permitted by the DGCL or such other applicable law as so amended.

 

(b) Period of Limitations.  No legal action shall be brought and no cause of action shall be asserted by or in the right of the Company or any of its subsidiaries against Indemnitee or Indemnitee’s estate, spouses, heirs, executors, personal or legal representatives, administrators or assigns after the expiration of five years from the date of accrual of such cause of action, and any claim or cause of action of the Company shall be extinguished and deemed released unless asserted by the timely filing of a legal action within such five year period, provided that if any shorter period of limitations is otherwise applicable to any such cause of action, such shorter period shall govern.

 

8. Miscellaneous.

 

(a) Severability.  If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever:  (i) the validity, legality and enforceability of the remaining provisions of this Agreement (including without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (ii) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (iii) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

 

  

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(b) Notices.  All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) on the date of delivery if delivered personally, or by facsimile, upon confirmation of receipt, (ii) on the first business day following the date of dispatch if delivered by a recognized next-day courier service or (iii) on the third business day following the date of mailing if delivered by domestic registered or certified mail, properly addressed, or on the fifth business day following the date of mailing if sent by airmail from a country outside of North America, to Indemnitee as shown on the signature page of this Agreement, to the Company at the address shown on the signature page of this Agreement, or in each case as subsequently modified by written notice.

 

(c) Amendment and Termination.  No amendment, modification, termination or cancellation of this Agreement shall be effective unless it is in writing signed by all the parties hereto.  No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar), nor shall such waiver constitute a continuing waiver.

 

(d) Successors and Assigns.  The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation, reorganization or otherwise) to all or substantially all of its business and assets, by agreement in form and substance reasonably satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.  This Agreement shall be binding upon and inure to the benefit of each party hereto and its successors and permitted assigns.

 

(e) Arbitration.

 

(i) Any dispute, claim or controversy arising out of, relating to, or in connection with this agreement, or the breach, termination, enforcement, interpretation or validity thereof, including the determination of the scope or applicability of this agreement to arbitrate, shall be finally determined by arbitration.  The arbitration shall be administered by JAMS.  If the disputed claim or counterclaim exceeds $250,000, not including interest or attorneys’ fees, the JAMS Comprehensive Arbitration Rules and Procedures (“JAMS Comprehensive Rules”) in effect at the time of the arbitration shall govern the arbitration, except as they may be modified herein or by mutual written agreement of the parties.  If no disputed claim or counterclaim exceeds $250,000, not including interest or attorneys’ fees, the JAMS Streamlined Arbitration Rules and Procedures (“JAMS Streamlined Rules”) in effect at the time of the arbitration shall govern the arbitration, except as they may be modified herein or by mutual written agreement of the parties.

 

  

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(ii) The seat of the arbitration shall be in Delaware unless the parties otherwise agree.  The parties submit to jurisdiction in the state and federal courts of the State of Delaware for the limited purpose of enforcing this agreement to arbitrate.

 

(iii) The arbitration shall be conducted by one neutral arbitrator unless the parties agree otherwise.  The parties agree to seek to reach agreement on the identity of the arbitrator within thirty (30) days after the initiation of arbitration.  If the parties are unable to reach agreement on the identity of the arbitrator within such time, then the appointment of the arbitrator shall be made in accordance with the process set forth in JAMS Comprehensive Rule 15.

 

(iv) The arbitration award shall be in writing, state the reasons for the award, and be final and binding on the parties.  The arbitrator may, in the award, allocate all or part of the costs of the arbitration, including the fees of the arbitrator and the attorneys’ fees of the prevailing party.  Judgment on the award may be entered by any court having jurisdiction thereof or having jurisdiction over the relevant party or its assets.  Notwithstanding applicable state law, the arbitration and this agreement to arbitrate shall be governed by the Federal Arbitration Act, 9 U.S.C. § 1, et seq.

 

(v) The parties agree that the arbitration shall be kept confidential and that the existence of the proceeding and any element of it (including but not limited to any pleadings, briefs or other documents submitted or exchanged, any testimony or other oral submissions, and any awards) shall not be disclosed beyond the tribunal, JAMS, the parties, their counsel, accountants and auditors, insurers and re-insurers, and any person necessary to the conduct of the proceeding.  The confidentiality obligations shall not apply (x) if disclosure is required by law, or in judicial or administrative proceedings, or (y) as far as disclosure is necessary to enforce the rights arising out of the award.

 

(f) Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware applicable to contracts executed and to be performed wholly within such State and without reference to the choice-of-law principles that would result in the application of the laws of a different jurisdiction.

 

(g) Integration and Entire Agreement.  This Agreement sets forth the entire understanding between the parties hereto and supersedes and merges all previous written and oral negotiations, commitments, understandings and agreements relating to the subject matter hereof between the parties hereto, provided that the provisions hereof shall not supersede the provisions of the Company’s articles of incorporation or bylaws, any agreement, any vote of shareholders or directors, the DGCL or other applicable law, to the extent any such provisions shall be more favorable to Indemnitee than the provisions hereof.

 

(h) Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall constitute an original.

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

 

	 	
China Chemical Corp.

	 
	 	 	 	 
	
 

	
By: 

	 	 
	 	 	
Name: Lu Feng

	 
	 	 	
Title:  Chief Executive Officer

	 
	 	 	 	 

 

 

AGREED TO AND ACCEPTED:

 

INDEMNITEE

 

By:        ________________________

 

Address:     _____________________

 

 

 

 

 

 

 

 

 

 

 

 

 

 

12ex105.htm

Exhibit 10.5

 

IntelliCell BioSciences Inc

 

NON-EXCLUSIVE

 

TECHNOLOGY AND TRADEMARK LICENSE AGREEMENT

 

NON-EXCLUSIVE TECHNOLOGY AND TRADEMARK LICENSE AGREEMENT (this "Agreement"), dated as of February , 2011 (the "Effective Date"), by and between IntelliCell Biosciences Inc. a [New York] corporation with offices at 30 East 76th Street, New York, New York 10021 ("Licensor") and Foursight LLC,,aSjosid2a Oited liability company d/b/a IntelliCell BioSciences of Palm Beach, with offices at  7-;„;94,4;4-773if5-("Licensee").

 

WHEREAS, Licensor is the owner of the Patent, Trademarks and Technology (as defined below); and

 

WHEREAS, Licensee desires, for the Term of this Agreement, to obtain a nonexclusive license, but exclusive within a defined geographic area as set forth herein, for the use and practice of the Patent, Technology and Trademarks; and

 

WHEREAS, Licensor is willing to grant such license, upon the terms and conditions hereinafter set forth, and the first right of refusal for exclusive license in the areas of Ft Myers and Tampa, Florida.

 

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants and agreements of the Parties contained in this Agreement, the Parties agree as follows:

 

1. DEFINITIONS

 

For the purposes of this Agreement, the following terms shall have the meanings set forth in this Section 1:

 

"Affiliate" of any Person shall mean with respect to any Person (the "Initial Person") any Person directly or indirectly controlling, controlled by, or under common control with, the Initial Person. For purposes of this definition, "control" (including with correlative meanings, the terms "controlling", "controlled by" and under "common control with") means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

 

"Confidential Information" shall mean information that was or will be developed, created, conveyed or discovered by or on behalf of either Party, or which became or will become known by, or was or is conveyed to it which has commercial value in its business and includes, but is not limited to, trade secrets, copyrights, patent applications, computer programs, designs, technology, ideas, know-how, processes, compositions, data improvements, inventions (whether patentable or not), works of authorship, work for hire, business and product development plans, customer lists and other similar information received in confidence by or for it, or developed exclusively for it by third parties, from any other person or entity.

 

  

1

  

 

"Equipment" shall mean certain medical and processing equipment developed as part of the Technology by Licensor to be used in conjunction with the Tissue Processing for Patents.

 

"Licensee Net Revenue" shall mean Licensee's gross revenue [less overhead, marketing expenses, cost of inventory, refunds, taxes, and allowances, (provided, however, that the aggregate deductions for all of the aforesaid deductions in any calendar year shall in no event exceed ten (10%) percent of gross revenues derived from Tissue Processing in such calendar year)] that is realized by Licensee as the result of Licensee's Tissue Processing.

 

"Party" shall mean Licensor or Licensee and, when used in the plural, shall mean Licensor and Licensee.

 

"Patent" shall mean the patent or patent application set forth on Exhibit A attached hereto.

 

"Person" shall mean any natural person, corporation, firm, business trust, joint venture, association, university, organization, company, partnership or other business entity, or any government or any agency or political subdivision thereof.

 

"Technology" shall mean the combination of technology, know-how and other intellectual property defined in the Patent and in other materials, provided by Licensor and affiliates of Licensor and which is required for the Tissue Processing.

 

"Territory" shall mean solely the geographical area set forth on Exhibit B attached hereto.

 

"Third Party" shall mean any Person who or which is neither a Party nor an Affiliate of a Party.

 

"Trademarks" shall mean the trademarks set forth on Exhibit C attached hereto.

 

"Tissue Processing" shall mean the separation of Adipose Stromal Vascular Fraction from fat tissue of Licensee's patients utilizing the Technology.

 

2. GRANT OF LICENSE; USE OF EQUIPMENT

 

Technology License Grant. Subject to the terms and conditions of this Agreement, Licensor hereby grants to Licensee a limited, non-assignable, non-transferable, non­sublicensable, royalty-bearing license to use and practice the Technology, solely for the provision of the Tissue Processing (the "License") and solely within the Territory, and strictly for no other purposes. For the Term of this Agreement, said License shall be an exclusive License as to the Territory; however, Licensor retains the right to grant such other licenses to Third Parties in geographic areas outside of the Territory.

 

  

2

  

 

Exploitation. Licensee hereby accepts the rights granted to Licensee pursuant to this Section 1 and agrees to use its best efforts in its use and exploitation of such rights throughout the Territory. Licensee shall not solicit business, market, promote, advertise, distribute nor perform any Tissue Processing outside of the Territory, either directly or indirectly, itself or through third parties; provided however, that the marketing of the Tissue Processing within the Territory may, by necessity, be distributed via medium of advertising outside the defined limits of the Territory and as long as the marketing is targeted at or within the Territory, such extended coverage area outside the Territory shall not be deemed a violation of this restriction. Except as to those persons or entities which specifically seek Licensee for services, Licensee shall promptly refer all inquires with respect to the Tissue Processing from persons or entities outside the Territory to Licensor (a "Referral"). To the extent that any such Referral is located in an area which is not yet subject to an exclusive license to a third party licensee of Licensor, then Licensee shall have the right to provide Tissue Processing services to such Referral.

 

Reservation of Rights. Notwithstanding any other provision of this Agreement, Licensor hereby reserves the perpetual, royalty-free worldwide right to license and use the Patent, Trademarks and the Technology licensed hereunder for any purpose, it being the intent of the Parties that the Licensor shall be entitled to continue to use and enjoy the Patent, Trademarks and the Technology to the fullest extent; provided, however, that Licensor agrees not to grant any license to use the Patents, Trademarks and the Technology, for use in the Tissue Processing, to any Person within the Territory for the duration of the Term.

 

Ownership of Patent, Trademarks and Technology. The Parties expressly acknowledge and agree that the Patents, Trademarks and Technology are, and shall remain, the sole property of Licensor, and that Licensee shall have no right, title or interest therein except as explicitly set forth in this Agreement.

 

Marketing/Instructional Materials. During the Term, and to the extent available, Licensor shall make available to Licensee, marketing and instructional materials in connection with the Tissue Processing. Licensor agrees to provide Licensee such training as appropriate and necessary for use of the Technology and the Equipment. Licensor shall provide Licensee such informational, training and marketing material updates as and when the Technology or Equipment changes, applicable laws or practices are modified, or further marketing materials are developed.

 

Right of First Refusal for Additional Territories. During the Term of this Agreement, Licensor hereby grants to Licensee or Licensee's designee (provided such designee is an Affiliate of Licensee) the option and right of first refusal to obtain a Technology and Trademark License Agreement, upon substantially the same terms, royalties and conditions as set forth in this Agreement, for exclusive Licenses within territories defined as (i) fifty (50) miles from the municipal limits of Tampa, Florida (the "Tampa Territory") and (ii) fifty (50) miles from the municipal limits of Fort Myers, Florida (the "Ft. Myers Territory"). (The Tampa Territory and the Ft. Myers Territory are sometimes herein referred to as the "Additional Territories".) At any time during the Term of this Agreement, in the event that Licensee shall desire to establish a License in either of the Additional Territories, Licensee shall provide written notice to Licensor of such election, and within thirty (30) days thereafter Licensor and Licensee's designee shall enter into a License Agreement for such Additional Territory. In the event that during the Term of this Agreement Licensor shall have a bona fide offer in writing to accept a License within any of such Additional Territories, Licensor shall provide written notice thereof to Licensee, and within thirty (30) days after receipt of such notice, Licensee shall notify Licensor in writing of its election to accept the exclusive License for such Additional Territory or elect not to accept such License for that Additional Territory. Failure to timely respond by Licensee shall be deemed a waiver of the right of first refusal to elect such a License by Licensee. In the event that Licensee elects to accept such a License, then within thirty (30) days thereafter Licensor and Licensee's designee shall enter into a License Agreement for such Additional Territory. In the event that Licensee shall not elect such License for said Additional Territory, then, for a period of thirty (30) days thereafter, Licensor shall have the right to enter into a License Agreement for such Additional Territory with a Third Party upon such terms and conditions as Licensor shall then be offering for such licenses, and in the event that no such license agreement is entered into by Licensor with a Third Party as to such Additional Territory, the Additional Territory shall continue to be subject to the option and right of first refusal in favor of Licensee as set forth in this provision.

 

  

3

  

 

Equipment. Licensee shall conduct the Tissue Processing with the use of the Equipment as provided by Licensor. The parties acknowledge that the Equipment shall be provided to Licensee at a total cost of Forty-Five Thousand and No/100 Dollars ($45,000.00) (the "Equipment Fee"). Upon payment of the Equipment Fee by Licensee, Licensor shall cause the Equipment to be delivered to Licensee, at the office location designated in writing by Licensee. Licensor agrees to provide Licensee with all appropriate training for the use, operation and routine maintenance of the Equipment. In consideration of the Equipment Fee, Licensor shall assist Licensee with processing service and maintenance claims with the manufacturer of the Equipment during the Term; however, in the event of any technical, operational or mechanical failure of the Equipment, Licensee shall have recourse not against Licensor, but only to the manufacturer of the Equipment pursuant to the warranties provided by the manufacturer.

 

3. PATENT AND TRADEMARKS.

 

No Obligation to Prosecute or Maintain the Patents and Trademarks. Licensor shall not have any obligation to prosecute or maintain the Patent or Trademarks.

 

Responsibilities for Filing, Prosecuting and Maintaining the Patent and Trademarks. Licensor shall have the exclusive right, but not the duty, to file, prosecute and maintain the appropriate patent and trademark protection for the Patent and Trademarks in any jurisdiction.

 

Infringement. Licensor shall protect and indemnify Licensee from any claims, actions, liabilities, judgments and expense, including reasonable attorneys fees and costs, arising from any Third Party claim or action alleging that the use of the License, Patent, Technology or Trademarks by Licensee constitutes an infringement of a Third Party patent, trademark or other intellectual property right. Licensee shall give Licensor prompt written notice of any claim or allegation received by it that the use of the Patent, Trademarks and/or Technology constitutes an infringement of a Third Party patent, trademark or other intellectual property right. Licensor shall have the duty, at its expense, to undertake and control the litigation of any alleged infringement of the Patent, Trademarks and/or Technology. Licensee shall cooperate in any such actions.

 

Patent and Trademark Enforcement. With respect to any alleged infringement involving the Technology or any claim of any Patent or Trademark, Licensor shall have the exclusive right, but not the duty, to institute patent, trademark or other infringement actions against Third Parties. In the event that Licensor fails to enforce its Patent, Trademark or other intellectual property rights as to infringement by any Third Party, Licensor assigns to Licensee the right to enforce such rights as the exclusive holder of the License within the Territory.

 

Covenant Not to Challenge. Except as otherwise may be required by law or as may be ordered by a court of competent jurisdiction or other governmental or quasi-governmental authority, Licensee covenants and agrees that during the Term, it shall not commence, maintain or cooperate in the maintenance of any action or proceeding seeking, by way of claim or defense, in whole or in part, to challenge the validity of the Patent, Trademarks and/or Technology, any of the claims contained therein or Licensor's ownership thereof. Licensee shall cooperate with Licensor in any action or proceeding, in asserting on behalf of Licensor the validity of the Patent, Trademarks and/or Technology claims, or ownership thereof.

 

Compliance with Laws. Licensee agrees to use the Patent, Trademarks and Technology in compliance with all applicable laws and regulations, including, but not limited to those administered and enforced by the US Food and Drug Admi .stration. Notwithstanding the foregoing, in the event that there is any law or regulation promulgated within the United States which has the effect of prohibiting the use of the Technology or otherwise frustrates the ability of Licensee to make a profit in the application of the Technology pursuant to the License, then Licensee shall have the right, upon thirty (30) days written notice to Licensor, to terminate this Agreement, whereupon the Parties shall be released of all obligations rising hereunder.

 

  

4

  

 

4. TERM AND TERMINATION

 

Term. Unless earlier terminated as provided below, this Agreement shall commence as of the Effective Date and shall continue thereafter for a period of ten (10) years (the "Initial Term"). Thereafter, this Agreement shall renew for subsequent periods of one year (each a "Renewal Term"). The Initial Term and the Renewal Terms are collectively referred to herein as the "Term". In the event either Party does not intend to renew this Agreement after the Initial Term, such Party shall notify the other of its intention not to renew at least ninety (90) days prior to the expiration of the Initial Term or any subsequent Renewal Term. Notwithstanding the foregoing, at the expiration of this Agreement Licensor shall not terminate this Agreement without cause, without first offering Licensee the option to renew this Agreement for another base term of ten (10) years upon the same terms, royalty structure and conditions as then being offered to Third Parties for licenses of the Technology by Licensor.

 

Termination. Either Party may terminate this Agreement by giving the other Party written notice in the event of a material default of any duty, obligation or responsibility imposed on it by this Agreement which has not been cured within ten (10) business days after the non-defaulting Party gives written notice to the defaulting party of such default. If the default is of such of a nature that it cannot be cured within ten (10) business days, the ten (10) business day cure period shall be extended for a further ten (10) business days (provided that the defaulting party has made diligent efforts to effect a cure during that initial cure period).

 

Minimum Yearly Licensee Net Revenue. Throughout the Term, [with the exception of the 2011 calendar year], Licensee shall achieve the Minimum Yearly Licensee Net Revenue as set forth on Exhibit D attached hereto. In the event that the Licensee fails to achieve such Minimum Yearly Licensee Net Revenue or pay the Minimum Yearly Licensee Net Revenue in any calendar year during the Term, such failure shall constitute a material breach of this Agreement, and Licensor shall have the right, not the obligation, upon thirty (30) days written notice to Licensee to immediately terminate this Agreement.

 

Following Termination. Upon the termination or expiration of this Agreement, Licensee shall immediately discontinue any and all further use of the Patent, Trademarks and Technology, and shall, upon Licensor's sole determination, within five (5) business days of such termination, return to Licensor or destroy any and all printed material, and all signs, advertising materials, promotional material or any other documentation upon which any of the Trademarks appear in any form whatsoever. In addition, Licensee shall, within five (5) business days of such termination, return to Licensor any and all papers and documents or any other materials, whether originals or copies, containing Confidential Information in its possession or control, including but not limited to all copies of software, all lists of any kind, data, computer printouts, agreements, contracts, and manuals and/or any copies thereof in its possession. Notwithstanding the foregoing, in the event of any such termination, Licensee shall have the right to complete service to any patient then engaging Licensee as of the date Licensee receives written notice of termination; however, Licensee shall not retain further patients using the Patents, Trademarks and Technology from and after the date Licensee receives such written notice of termination.

 

  

5

  

 

5. ROYALTIES AND MINIMUM ROYALTIES

 

Royalty. Licensee shall pay to Licensor a royalty payment equal to the greater of Two Hundred and Fifty Dollars ($250) for each Tissue Processing case or ten percent (10%) percent of all Licensee Net Revenue during the Term (the "Royalty" or "Royalties"). All Royalties provided for under this Agreement shall accrue whenever the respective Tissue Processing's are performed, billed and paid for, but in any case within thirty (30) days after Tissue Processing is completed for the patient. Royalties shall be paid monthly within five (5) days following the conclusion of each calendar month during the Term. The obligation of Licensee to pay Royalties to Licensor hereunder is absolute notwithstanding any claim which Licensee may assert against Licensor. Licensee shall not have the right to set off, or to make any deduction from Royalties due pursuant to the provisions hereof for any reason whatsoever, except in the event of (i) a prior overpayment of Royalty to Licensor, or (ii) a default of Licensor pursuant to the terms of this Agreement.

 

Royalty Statements. Simultaneously with the submission of all payments, and not later than five (5) days after the end of each calendar month, but regardless of whether any payment is due, Licensee shall submit a monthly report, in such manner and form as shall be reasonably acceptable to Licensor setting forth the number, description, dates and invoice prices of all Tissue Processing provided and any other information that may be reasonably required by Licensor for the previous calendar month (each a "Royalty Statement"). Any Royalty payment which is not paid or expended on or before the due date thereof shall thereafter bear interest at the rate of eight percent [8%] per annum, which shall be payable to Licensor on demand. The receipt or acceptance by Licensor of any Royalty Statements furnished pursuant to this Agreement, or the receipt or acceptance of any Royalties, shall not preclude Licensor from questioning the correctness thereof at any time thereafter for a period of three (3) years after such payment is collected or Royalty Statement furnished.

 

No Deductions. Unless otherwise required by law, all payments made by Licensee under this Agreement shall be made free and clear of, and without deduction or withholding for or on account of, any present or future income, turnover, sales, value added stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any tax or other governmental authority, excluding all present and future income taxes imposed on Licensor.

 

6. LICENSEE'S BOOKS AND RECORDS

 

Books of Account. Licensee shall maintain appropriate books of account and records, of all its operations under or in connection with this Agreement all in accordance with generally accepted accounting principles consistently applied (such as sales journals, sales return journals, cash receipt books, general ledgers, purchase orders and inventory records) and shall make accurate entries concerning all transactions relevant to this Agreement.

 

Examination by Licensor. During the Term, and for three (3) years after the making of any payment or the rendering of any Royalty Statement, Licensor, and its employees, agents and representatives, shall have the right, at its own expense, on reasonable notice to Licensee (but in no event need such notice be more than five (5) days) and during regular business hours, to examine, photocopy, and make extracts from such books of account and other records, documents and materials (including, but not limited to, invoices, purchase orders, sales records, and reorders) at its sole cost and expense to the extent needed to confirm sales, Royalties, and

other matters relating to compliance with this Agreement regarding such payments or statements, which shall be maintained and kept by Licensee during the period specified herein. Licensor shall maintain all of Licensee's books and records as confidential, except as to professionals retained by Licensor for the purposes of examination of the same.

 

  

6

  

 

Discrepancies in Reporting. If any examination or audit by Licensor for any period discloses that the actual Net Sales for that period exceeded those reported by more than five percent (5%), Licensee shall pay the actual and reasonable cost of such examination or audit in addition to the amount of Royalties that such examination or audit discloses is owed to Licensor together with interest on the unreported amount at a rate of eight percent [8%] per annum. All payments due pursuant to this Section must be made within fifteen (15) days after Licensee receives notice thereof. In the event that such examination or audit reveals that Licensee has overpaid Licensor, and such overpayment shall be credited to Licensee for any ensuing payments, or if at the termination of this Agreement, shall be refunded to Licensee within fifteen (15) days of determination.

 

7. TRADEMARK USE

 

Use of Trademark. Licensee shall use and display the Trademarks only in such forms as specifically approved in writing in advance by Licensor, including without limitation, use of the Trademarks on advertising, promotional or publicity materials, displays, stationary or business cards and shall not use the Trademarks on any such items unless so approved. Licensee shall not use any of the Trademarks in its corporate name or file any "d/b/a" incorporating the Trademarks, except as approved by Licensor. Licensor approves of the "d/b/a" of "IntelliCell BioSciences of Palm Beach" for use by Licensee.

 

Limitation. Any use of the Trademarks by Licensee is limited to the Territory and is granted solely for the ordinary business of Licensee in connection with the Tissue Processing for Licensee's patients in the Territory. None of Licensee's rights to use the Trademarks shall be transferable, either in whole or in part. Licensee acknowledges the exclusive right, title and interest of Licensor in and to the Trademarks, and shall not at any time contest or in any way impair such right, title and interest, or indicate to the public in any manner whatsoever that Licensee has or has ever had an interest in the Trademarks other than the limited right to use them as specified in this Agreement.

 

Exclusive Property of Licensor. As between Licensor and Licensee, the Trademarks, as well as any other trademarks, marks, service marks, tradenames, logos, symbols, trade dress, copyrights and/or other intellectual property relating to or used in connection with the Technology and Tissue Processing are, and shall remain, the exclusive property of Licensor. Licensee may not register any similar trademarks, marks, logos, trade dress, copyrights or symbols.

 

No Reproduction. Other than expressly provided for in this Agreement, Licensee shall not directly or indirectly reproduce, copy, alter, edit or otherwise modify or make or cause to be made any imitation of the Technology or the Tissue Processing. Licensee shall not, during the Term hereof or thereafter, attempt to acquire any rights in connection with the Trademarks or other intellectual property of Licensor. The use by Licensee of the Trademarks shall not in any way create in Licensee any right, title or interest in or to the Trademarks or any other intellectual property of Licensor.

 

  

7

  

 

8. TISSUE PROCESSING AND QUALITY STANDARDS

 

Licensee represents and warrants that it will use its best efforts to ensure its provision of the Tissue Processing shall be of the highest quality. Licensor makes no representation as to the Equipment; however, Licensor assigns to Licensee all rights to service and warranties from the manufacturer of the Equipment.

 

9. INDEMNITY AND REPRESENTATIONS

 

Indemnity. Licensee hereby saves and holds Licensor harmless of and from and indemnifies and agrees to defend Licensor against any and all losses, liability, damages and expenses (including reasonable attorneys' fees and expenses) which Licensor may incur or be obligated to pay, or for which Licensor may become liable or be compelled to pay in connection with any action, claim or proceeding by third parties against Licensor for or by reason of or in connection with Licensee's use of the Patent, Trademarks and/or Technology; and/or any breach of the representations and warranties of Licensor set forth in this Agreement.

 

Warranties and Representations. Nothing in this Agreement shall be deemed to be a representation or warranty by Licensor of the validity of the Patent, Trademarks or Technology or the accuracy, safety, efficacy or usefulness for any purpose thereof. Licensor shall have no obligation, express or implied, to supervise, monitor, review or otherwise assume responsibility for any use of the Patent, Trademarks and/or Technology by Licensee in the provision of the Tissue Processing, and to the extent permitted by law, Licensor shall have no liability whatsoever to Licensee or any Third Parties for or on account of any injury, loss or damage, of any kind or nature, sustained by, or any damage assessed or asserted against, or any other liability incurred by or imposed upon Licensee, its Affiliates or any other person or entity arising out of or in connection with or resulting from any use of the Patent, Trademarks and/or Technology by Licensee in the provision of the Tissue Processing.

 

10. CONFIDENTIAL INFORMATION

 

Nondisclosure of Confidential Information. Both Parties agree not to disclose any of the other Party's ("Disclosing Party") Confidential Information, verbal or written, which may be conveyed to the other Party ("Recipient") from any source before, during or subsequent to the Term of this Agreement. It is expressly understood and agreed that any such Confidential Information conveyed to Recipient is intended for the Recipient's internal use only and shall be protected by the Recipient with the same diligence, care, and precaution (but in no event less than reasonable care) that the Recipient uses to protect its own Confidential Information. At the Disclosing Party's request, the Recipient shall return any or all Confidential Information then in its possession, including all copies thereof. Both parties shall incorporate the substance of this section when Confidential Information is shared with third parties in conformity with the performance of its obligations under this Agreement to the extent that Confidential Information is provided to third parties.

 

  

8

  

 

Non-Confidential Information. Both Parties shall have no obligation with respect to the disclosure and use of non-confidential information to the extent such information: (i) is or becomes generally available to the public other than as a consequence of a breach of an obligation of confidentiality by the Recipient; (ii) is made public by the Disclosing Party; (iii) is independently developed by Recipient; (iv) is received from a third party independent of either Party without breaching an obligation of confidentiality; or (v) is required to be disclosed by operation of law.

 

11. MISCELLANEOUS

 

Relationship of Parties. Nothing in this Agreement is intended or shall be deemed to constitute a partnership, agency, employer employee or joint venture relationship between the Parties. No Party shall make any commitments for the other.

 

Assignment. No assignment, transfer or sublicense by Licensee of any of its rights under this Agreement shall be permitted.

 

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

 

Notice. Any notice or other communication required or permitted hereunder shall be in writing and shall be delivered, to the addresses set forth below, personally or by a recognized overnight courier service. Any such notice shall be deemed given when so delivered personally or, if delivered by overnight courier service, on the next business day after the date of deposit with such courier service:

 

 

	If to the Licensor:	 	 	 
	 	Victor Dermatology and Rejuvenation Lasersculpt, Inc. 	 
	 	30 East 76th Street	 
	 	New York, New York 10021	 	 
	 	Attn: Steven Victor	 	 
	 	 	 	 
	With a copy to:	 	 	 
	 	Morrison Cohen LLP	 	 
	 	909 Third Avenue, 27th Floor	 	 
	 	New York, New York, 10022 	 	 
	 	Attn: Charles Salfeld, Esq.	 	 
	 	 	 	 
	If to the Licensee:	 	 	 
	 	Foursight LLC d/b/a IntelliCell BioSciences of Palm Beach	 	 
	 	 	 	 
	 	Attn: Richard Shaw, Manager	 	 
	 	 	 	 
	With a copy to:	 	 	 
	 	Pineiro Byrd PLLC	 	 
	 	4600 Military Trail, Suite 212 	 	 
	 	Jupiter, Florida 33458	 	 
	 	Attn: Barry B. Byrd, Esq.	 	 

 

 

  

9

  

 

Any Party may, by notice given in accordance with this section to the other Party, designate another address or person for receipt of notices hereunder.

 

Waiver. A waiver by either Party of any of the terms and conditions of this Agreement in any instance shall not be deemed or construed to be a waiver of such term or condition for the future, or of any subsequent breach hereof. All rights, remedies, undertakings, obligations and agreements contained in this Agreement shall be cumulative and none of them shall be in limitation of any other remedy, right, undertaking, obligation or agreement of either Party.

 

Severability. When possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement, and the Parties shall negotiate in good faith to modify this Agreement to preserve (to the extent possible) their original intent.

 

Amendment. No amendment, modification or supplement of any provisions of this Agreement shall be valid or effective unless made in writing and signed by a duly authorized officer of each Party.

 

Governing Law. The construction, interpretation and enforcement of this Agreement shall be governed by the internal laws of the State of New York, excluding its conflict-of-laws principles. In the event of any litigation arising hereunder, the prevailing party shall be entitled to recovery of reasonable attorneys fees and costs.

 

Entire Agreement. This Agreement sets forth the entire agreement and understanding between the Parties as to the subject matter hereof and merges all prior discussions and negotiations between them, and neither of the Parties shall be bound by any conditions, definitions, warranties, understandings or representations with respect to such subject matter other than as expressly provided herein.

Injunctive Relief. Each Party acknowledges that, in the event of its breach or threatened breach of any of the provisions of this Agreement, the non-breaching Party would sustain great and irreparable injury and damage. Therefore, in addition to any other remedies which the non-breaching Party may have under this Agreement or otherwise, the non-breaching Party shall be entitled to an injunction issued by any court of competent jurisdiction restraining such breach or threatened breach. This Section shall not, however, be construed as a waiver of any of the rights which the non-breaching Party may have for damages or otherwise.

 

Counterparts. This Agreement may be executed in any number of counterparts, any one of which need not contain the signature of more than one Party but all such counterparts taken together shall constitute one and the same agreement. This Agreement may be executed by facsimile.

 

Descriptive Headings. The descriptive headings of this Agreement are for convenience only and shall be of no force or effect in construing or interpreting any of the provisions of this Agreement.

 

[signatures on following page]

 

 

  

10

  

 

IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed by its duly authorized officer as of the date first above written.

 

	IntelliCell Bioscie es Inc.	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 
	By:	 	 	 
	Name:	
 

	 	 	 
	Title:	
 

	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	
Foursight LLC, a Florida limited liability company, 

dVb/a IntelliCell BioSciences of Palm Beach

	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 
	By:	 	 	 
	Name:	Richard Shaw 	 	 	 
	Title:	Manager	 	 	 

 

 

 

  

11

  

 

Exhibit A

 

[Patent] [Patent Application]

 

 

[Ultrasonic Cavitation for the separation of Stromal Vascular Fraction from Adipose Tissue]

 

 

  

12

  

 

Exhibit B

 

Territory

 

 

A fifty (50) mile radius from the municipal limits of the town known as Lake Worth, Florida

 

 

  

13

  

 

Exhibit C

 

Trademarks

 

[IntelliCell]

 

[IntelliCell BioScience]

 

 

 

14

 

 

Minimum Yearly Licensee Net Revenue

 

Throughout the Term, [with the exception of the 2011 calendar year], Licensee shall achieve the following minimum yearly "Licensee Net Revenue" (the "Minimum Yearly Licensee Net Revenue"). In the event that the Licensee fails to achieve or pay such Minimum Yearly Licensee Net Revenue in any calendar year during the Term, such failure shall constitute a breach of this Agreement, as set forth in Section 4 above, and Licensor shall have the right, not the obligation, to immediately terminate this Agreement.

 

	 	 	 	Cases/wk	Cases/yr	Annual Royalty	 
	
yri

	 	 	10	 	 	520	$ 	 	130,000	 
	
yr2

	 	 	15	 	 	780	 $ 	 	195,000	 
	
yr3

	 	 	20	 	 	1040	 $ 	 	260,000	 
	
yr4

	 	 	25	 	 	1300	 $ 	 	325,000	 
	
yr5

	 	 	30	 	 	1560	 $ 	 	390,000	 

 

As noted above, the abbreviated for years relate to the following corresponding calendar years:

 

	
Abbreviation of Year

	
Calendar Year (or portion thereof)

	
Yr 1

	
2012

	
Yr 2

	
2013

	
Yr 3

	
2014

	
Yr 4

	
2015

	
Yr 5

	
2016 through expiration of Term

 

 

 

 

15

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