Document:

Strategic Environmental & Energy Resources, Inc. 10-Q

 

Exhibit 10.5

 

IRREVOCABLE LICENSE & ROYALTY AGREEMENT

 

This LICENSE &
ROYALTY AGREEMENT (“Agreement”) is entered into this 21st day of March, 2012 by Strategic Environmental
& Energy Resources, Inc. a Nevada corporation (“SEER”) and Paragon Waste Solutions, LLC, a Colorado limited liability
company (“PWS”)

 

RECITALS

 

WHEREAS, pursuant
to that certain Exchange & Acquisition Agreement dated August 10, 2011, (“EA Agreement”) SEER purchased and acquired
from Black Stone management Services, LLC (“BSMS”) certain technology relating to cold plasma oxidation and all the
Intellectual Property arising out of or related to the technology (“Technology”); and 

 

WHEREAS, by agreement
the Technology currently resides wholly and exclusively in SEER; and

 

WHEREAS, pursuant to
the terms and conditions of the EA Agreement, the parties to that agreement agreed to irrevocably license the Technology to PWS;

  

WHEREAS, in exchange
for various consideration paid and received, and equity distributions, in exchange for licensing the Technology to PWS, PWS has
agreed to grant SEER a royalty interest in any and all revenues generated by PWS from any source throughout the world (“Royalty
Territory”) from the exploitation, utilization or commercialization of the Technology.

 

WHEREAS, the parties
intend that such license to use the Technology will be an exclusive license;

  

NOW THEREFORE, in consideration
of the mutual covenants contained in this Agreement and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereby agree as follows.

 

1.                             
DEFINITIONS 

 

1.1Affiliate
means, with respect to any specified person, any other person which controls, is under common control with, or is controlled by
such specified person.

 

1.2Gross Revenues
means the gross revenue collected and realized by PWS or its Affiliates during the Term from any and all commercial endeavors in
the Royalty Territory directly or indirectly involving the Technology.

  

1.3“CoronaLux
System” or “Technology” means the combination of pyrolytic and plasma unit as described in US Patent (and/or
Provisional) Application 61/648377, and all subsequent additions, improvements, CIP’s and other affiliated patents.

 

1.4Royalty
means five percent (5%) of Gross Revenues from the sale or lease of the CoronaLux System.

  

1.5Term
means the period commencing as of the date of this Agreement and shall continue for a period not to exceed the life of the patent
or patents filed by SEER.

    	-1-

    	 

    

 

2.ROYALTIES

 

2.1 License. SEER hereby irrevocably and exclusively grants a world-wide license to PWS of all of its rights to the Technology
(“License”) in exchange for the payment by PWS to SEER of any Royalty accruing under this Royalty Agreement on a quarterly
basis in arrears. These royalty payments shall be made by PWS out of its retained earnings. In the event PWS has no quarterly retained
earnings from which it can make the royalty payment, all such payments shall accrue and be paid out of subsequent retained earnings
of PWS. This License shall provide PWS with the exclusive right to exploit, utilize and commercial the Technology in the Royalty
Territory for the Term.

  

2.2 Payment. Within thirty (30) days after the end of each calendar quarter during the Term, PWS shall submit to SEER
a statement in writing indicating the Gross Revenues during the previous calendar quarter and a calculation of the Royalty due
along with payment of the appropriate Royalty amount (“Royalty Statement”). Upon termination or expiration of
this Royalty Agreement, all past due Royalties shall be accelerated and shall immediately become due and payable.

 

2.3Sub Licenses.
PWS may sub license the Technology in the best interest of SEER. Any revenue derived from sub licensing shall be included in the
calculation of Gross Revenue for purposes of determining Royalty payments due SEER.

 

2.4No Minimum
Payments. PWS shall use all commercially reasonable efforts to offer, promote and market the Technology for sale and use in
the Marketing Territory. However, SEER agrees and acknowledges that: (a) PWS assumes no obligation to pay any minimum Royalty
hereunder; (b) PWS has full power, authority and discretion to establish the price and terms related to the exploitation of the
Technology; and (c) there is no guarantee that the marketing or deployment of the Technology will be successful or that the Technology
will generate Gross Revenues, or a resulting Royalty, in any minimum amount.

 

2.5Audit.
PWS agrees to maintain accurate and complete records of all Gross Revenues and Royalty payments made pursuant to this Royalty
Agreement (the “Records”). The Records will be retained for a period of at least one (1) year following the date a
Royalty payment is made to SEER hereunder. With prior written notice of at least thirty (30) days, DSC agrees to permit SEER or
any person or entity designated by SEER to examine and audit the Records, provided that PWS may require such third party representative
to sign a non-disclosure agreement prior to any such disclosure. The audit will be conducted during normal business hours at the
place the Records are normally maintained and will not unreasonably disrupt PWS’s business. In the event such audit discloses
an underpayment or overpayment of Royalties due hereunder, the appropriate party will promptly remit the amounts due to the other
party within thirty (30) days. Such audit shall be conducted at SEER’s expense; unless a discrepancy or error resulting
in an under-payment exceeding five percent (5%) of the amount actually due is found in conjunction with audit, in which case,
the cost of such audit shall be borne by PWS. Prompt adjustment shall be made by the appropriate party to compensate for any errors
or omissions disclosed by such audit.

 

3.TERMINATION
AND TRANSFER

  

3.1Termination. Notwithstanding
the Term, this Royalty Agreement shall terminate upon written notice from one party to the other if the party receiving such notice
is in material breach of its obligations hereunder, or if any of its representations hereunder prove false or misleading, and the
same is not cured within thirty (30) days from that date of such notice.

    	-2-

    	 

    

 

3.2Sale
or Transfer. PWS is prohibited from selling or otherwise transferring the Technology without the written consent from the
Board of Directors of SEER. Any attempt to sell or transfer the Technology without the written consent of SEER shall be void ab
initio.

 

4.Rights
of PWS

 

4.1 Title. PWS acknowledges SEER’s ownership of the Technology and shall not at any
time do or suffer to be done any act or thing which will in any way impair the rights of SEER in and to the Technology. 

  

4.2 Regulatory Filings. PWS will be responsible, at its sole discretion, for obtaining and maintaining any and all regulatory
approvals necessary or useful for the marketing, placement, promotion or exploitation of the Technology. SEER shall provide any
documents requested by PWS in connection with obtaining and maintaining such approvals.

 

4.3  Product
Design. PWS shall be entitled, in its sole discretion, to make any improvements or adjustments to the Technology as it deems
necessary or desirable.

 

4.4 
Intellectual Property Rights. SEER represents and warrants that no filing with, consent, approval, authorization,
order, registration, or qualification of any third party is necessary for or required for the valid execution, delivery and performance
by SEER of its obligations under this Agreement.  In furtherance thereof, SEER represents and warrants that the Technology,
with respect to either design or operation, and the SEER IP will not result in a default of or breach by SEER under any third-party
agreement or its affiliates with respect to the Technology.

 

4.5
Intellectual Property Enforcement Rights. PWS may enforce any patent, trade secrets or other intellectual property
rights related to the SEER Technology against infringers, and receive damages awarded against the infringers in any such enforcement
actions. Each party shall: (a) at the other’s written request, execute all instruments and take all other steps necessary
to assist in any intellectual property right enforcement efforts; and (b) immediately notify the other in writing in the event
it learns of any claim or act of any third party that constitutes or may constitute or result in the infringement or any other
violation of the intellectual property rights in the SEER IP or Technology.

 

5.REPRESENTATIONS
AND WARRANTIES.

 

5.1Representations and Warranties
of PWS. PWS represents and warrants that it has the requisite organizational authority and power to enter into this Agreement.

 

5.2Representations and Warranties
of SEER. SEER represents and warrants that it has the requisite organizational authority and power to enter into this Agreement;
that its contributions to the Technology and the SEER IP will not, to its knowledge, infringe or misappropriate any patent, copyright,
trade secret or other intellectual property right of any third party; that no third party has any rights, intellectual property
or otherwise, in the SEER IP; and that its performance hereunder are not subject to any restriction or limitation, contractual
or otherwise, and will not constitute a breach of any agreement or commitment to which it is bound.

 

6.     
MISCELLANEOUS

  

6.1Entire Agreement. This
Agreement sets forth the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes any
previous understandings or agreements, whether written or oral, regarding such matter.

    	-3-

    	 

    

 

6.2Binding Agreement:
Assignment. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of PWS and SEER. Neither
party shall assign this Agreement or any rights or obligations hereunder, without the prior written consent of the other party,
which shall not be unreasonably withheld; provided, however, that no such consent shall be required for any assignment by a party
of this Agreement or any rights or obligations hereunder to any: (i) Affiliate of such party; or (ii) successor pursuant to a
merger, consolidation or sale of all or substantially all of its assets. Any attempted assignment in violation of this Section
shall be void ab initio. Any permitted assignee or successor of a party shall be bound by all the terms and conditions
of this Agreement, including, but not limited to, the applicable Royalty payments to SEER.

 

6.3Amendment and Waiver.
This agreement may be amended or any provision of this Royalty Agreement may be waived only if such amendment or waiver is set
forth in a writing executed by all parties. The failure of any party to enforce any provision or the right of such party thereafter
to enforce such provision or any other provision of this Royalty Agreement shall not constitute a waiver of such provision.

 

6.4Relationship
of Parties. The parties agree that nothing in this Agreement shall be construed to create the relationship of employer and
employee between the parties. Nothing contained in this Agreement shall be construed as creating a partnership, joint venture,
agency, trust or other association of any kind, each party being individually responsible only for its obligations as set forth
in this Royalty Agreement. No party shall act or represent or hold itself out as having authority to act as an agent or partner
of any other party, or in any way bind or commit the other party to any obligations.

 

6.5Severability.
The illegality, invalidity or unenforceability of any part of this Agreement shall not affect the legality, validity or enforceability
of the remainder of this Agreement. If any part of this Royalty Agreement shall be found to be illegal, invalid or unenforceable,
this Royalty Agreement shall be given such meaning as would make this Agreement legal, valid and enforceable in order to give
effect to the intent of the parties.

 

6.6Confidential Information. Except as expressly provided herein, the parties agree
that each shall keep the terms of this Agreement confidential, except as to their lawyers, accountants or advisors. SEER shall
keep completely confidential and shall not publish or otherwise disclose and shall not use for any purpose except for the purposes
contemplated by this Agreement any Confidential Information furnished to it by PWS hereto pursuant to this Agreement, except that
to the extent that it can be established by SEER by competent proof that such Confidential Information:

 

(i)was already known
to SEER, other than under an obligation of confidentiality, at the time of disclosure;

 

(ii)was generally available
to the public or otherwise part of the public domain at the time of its disclosure to SEER;

 

(iii)became generally
available to the public or otherwise part of the public domain after its disclosure and other than through any act or omission
of SEER; or

 

(iv)was independently
developed by SEER.

 

For purposes of this section, “Confidential
Information” shall mean the terms of this Agreement, the Royalty Statements and the Records, and any and all information,
know-how and data, whether oral, written or graphical, disclosed or provided by PWS to SEER, including but not limited to any drawings,
plans, analysis, materials, product or conclusions drawn or derived therefrom or which may be derived from or related to any visits
by personnel of one party to the location of the other or may be otherwise known to one party through its visits or contacts with
the other.

 

    	-4-

    	 

    

6.7Waiver. No waiver by
either party of any condition or of any breach of any term contained in this Agreement shall be deemed a waiver of such condition
or term.

 

6.8Governing
Law Submission to Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State
of Colorado, without regard to conflicts of law provisions thereof. The parties shall submit all disputes which arise under this
Agreement to binding arbitration to be conducted under the applicable rules and regulations of the AAA and in Denver, Colorado
for resolution.

 

6.9Notices.
All notices under this Agreement shall be in writing and sent by first class mail or by reputable courier service to the addresses
of the respective parties to such address as the party may hereafter specify by written notice so given. Notices shall be effective
upon receipt at the location of the specified address. Either party may change its address for notice purposes by providing written
notice of the change of address to the other party.

 

6.10Counterparts. This Agreement may be executed in counterparts,
or facsimile versions, each of which shall be deemed to be an original, and both together shall be deemed to be one and the same
agreement.

 

In WITNESS WHEREOF and intending to be legally
bound hereby, the parties have executed this Irrevocable License & Royalty Agreement as of the dates set forth below.

 

 

	STRATEGIC ENVIRONMENTAL &	 	PARAGON WASTE SOLUTIONS, LLC
	ENERGY RESOURCES, INC.	 	 
	 	 	 
	By: J. John Combs III

	 	By: Fortunato Villamagna
	 	 	 
	/s/ J. John Combs III	 	/s/ Fortunato Villamagna

	 	 	 
	Title: CEO	 	Title: President
	 	 	 
	Date:1/15/2013	 	Date:1/15/2013

 

 

    	-5-Moody National REIT I, Inc. 10-Q

EXHIBIT 10.1

Moody National Advisor I, LLC

6363 Woodway Drive, Suite 110

Houston, Texas 77057

 

 

 

 

 

 

September 24, 2013

 

	
        Moody
        National Advisor I, LLC

        6363
        Woodway Drive, Suite 110

        Houston,
        Texas 77057
	 

 

Ladies
and Gentlemen:

Moody
National Advisor I, LLC (the “Advisor”), Moody National Operating Partnership I, L.P. (the “Operating
Partnership”), Moody Realty Company, L.P. and Moody National REIT I, Inc. (the “REIT”) are parties
to that certain Amended and Restated Advisory Agreement, dated as of August 14, 2009 (as subsequently amended, the “Advisory
Agreement”).  Capitalized terms used herein that are not otherwise defined have the respective meanings given
to them in the Advisory Agreement.

1.Waiver
of Reimbursable Expenses.

 Pursuant
to Section 10(a) of the Advisory Agreement, the Advisor is entitled to reimbursement by the REIT for all of the Total Operating
Expenses paid or incurred by the Advisor in connection with the services it provides to the REIT and the Operating Partnership
pursuant to the Advisory Agreement; provided, however, the REIT shall not reimburse the Advisor at the end of any fiscal quarter
in which Total Operating Expenses for the four consecutive fiscal quarters then ended exceed the greater of 2% of Average Invested
Assets or 25% of Net Income for such year.  Pursuant to Section 27 of the Advisory Agreement, the Advisor hereby irrevocably
waives all expenses reimbursable to the Advisor pursuant to the Advisory Agreement for the fiscal quarter ended September 30,
2013 (“Waiver Period”) to the extent such expenses have not been reimbursed to the Advisor as of the date hereof.   The
Advisor further acknowledges that all expenses incurred directly by the REIT and incurred by the Advisor on the REIT’s behalf
during the Waiver Period shall be paid by the Advisor on behalf of the REIT.

2.Continuing
Obligation to Reimburse Organization and Offering Expenses.

For
the avoidance of doubt, nothing herein shall constitute a waiver of the obligation of the REIT to reimburse the Advisor and its
Affiliates for Organization and Offering Expenses.

    	 

    	 

    

September 24, 2013

Page 2

3.Ratification;
Effect on Advisory Agreement.

(a)Ratification.
The Advisory Agreement, as amended by this letter agreement, shall remain in full force and effect and is hereby ratified and
confirmed in all respects.

 

(b)Effect
on the Advisory Agreement. On and after the date hereof, each reference in the Advisory Agreement to “this Agreement,”
“herein,” “hereof,” “hereunder,” or words of similar import shall mean and be a reference
to the Advisory Agreement as amended hereby.

 

4. Miscellaneous.

 

(a)Governing
Law. This letter agreement and the legal relations between the parties hereto shall be construed and interpreted in accordance
with the internal laws of the State of Maryland.

 

(b)Modification.
This letter agreement shall not be changed, modified, or amended, in whole or in part, except by an instrument in writing signed
by the parties hereto, or their respective successors or assignees.

 

(c)Headings.
The titles and headings of the sections and subsections contained in this letter agreement are for convenience only, and they
neither form a part of this letter agreement nor are they to be used in the construction or interpretation hereof.

 

(d)Severability.
The provisions of this letter agreement are independent of and severable from each other, and no provision shall be affected or
rendered invalid or unenforceable by virtue of the fact that for any reason any other or others of them may be invalid or unenforceable
in whole or in part.

 

(e)Counterparts.
This letter agreement may be executed in multiple counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, and all of which shall together constitute one and the same instrument.  This letter
agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures
of all of the parties reflected hereon as the signatories.  This letter agreement, to the extent signed and delivered by
means of electronic mail or a facsimile machine, shall be treated in all manner and respects as an original agreement or instrument
and shall be considered to have the same binding legal effect as if it were an original signed version thereof delivered in person. 
No party hereto shall raise the use of electronic mail or a facsimile machine to deliver a signature or the fact that any signature
was transmitted or communicated through the use of electronic mail or a facsimile machine as a defense to the formation or enforceability
of a contract and each party hereto forever waives any such defense.

    	 

    	 

    

September
24, 2013

Page 3

	 	 	Very
truly yours,
	 	 	 
	 	 	Moody National Advisor I, LLC
	 	 	 
	 	 	By:	/s/ Brett
C. Moody
	 	 	Name:	Brett
C. Moody
	 	 	Title:	

President
and Chief Executive Officer

 

 

 

 

    	 

    	 

    

September
24, 2013

Page 4

 

Acknowledged
and Agreed on the ___ day of September, 2013:

 

 

Moody
National REIT I, Inc. 

 

	 	By:	/s/
Brett C. Moody
		Name:	Brett
                                                              C. Moody
	 	Title:	President

 

 

Moody
National Operating Partnership I, L.P. 

 

		By:	Moody National
                                                            REIT I, Inc., its general partner

 

	 	By:	/s/
Brett C. Moody
		Name:	Brett
                                                              C. Moody
	 	Title:	President

 

 

Moody
National Realty Company, L.P. 

 

 

	 	By:	/s/
Brett C. Moody
		Name:	Brett
                                                              C. Moody
	 	Title:	President

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