Document:

ex10_36.htm

Exhibit 10.36

 

REGISTRATION RIGHTS AGREEMENT

 

This Registration Rights Agreement (this “Agreement”) is entered into as of June 1, 2012, between Liquidmetal Technologies, Inc., a Delaware corporation (the “Company”), and Visser Precision Cast, LLC, a Colorado limited liability Company (the “Buyer”).

 

W I T N E S S E T H:

 

WHEREAS, the Company and the Buyer have entered into a Subscription Agreement, dated as of June 1, 2012 (the “Subscription Agreement”), pursuant to which the Company has agreed to issue and sell to the Buyer, (i) up to 30,000,000 shares (collectively, the “Common Shares”) of Common Stock (as defined below) and (ii) Common Stock Purchase Warrants to purchase up to 15,000,000 shares of the Common Stock (the “Warrants”).  The Company has also agreed to issue to the Buyer 6% Senior Secured Convertible Notes of the Company in the principal amount of up to $2,000,000 (the “Notes”);

 

WHEREAS, the Notes are convertible into shares of Common Stock; and

WHEREAS, the Warrants are exercisable to purchase shares of Common Stock pursuant to the terms and conditions set forth in the Warrants.

 

NOW, THEREFORE, in consideration of the mutual promises, representations, warranties, covenants and conditions set forth in the Subscription Agreement and this Agreement, the Company and the Buyer agree as follows:

 

1.             Certain Definitions.  Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Subscription Agreement.  As used in this Agreement, the following terms shall have the following respective meanings:

 

“Business Day” means any day except any Saturday, any Sunday, any day which shall be a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.

 

“Commission” or “SEC” shall mean the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act (as defined below).

 

“Common Stock” means the common stock of the Company, $0.001 par value per share.

“Conversion Shares” means shares of Common Stock issued (or issuable at the time in question) upon conversion of the Notes.

 

“Effectiveness Date” means, with respect to a registration statement filed pursuant to Section 2 of this Agreement, the earlier of (a) (i) the sixtieth (60th) day following the Filing Date (as defined below) in the case of a registration statement on Form S-3, (ii) the ninetieth (90th) day following the Filing Date in the case of a registration statement on Form S-1 or (iii) in the event that either registration statement described in clauses (i) and (ii) receives a “full review” by the Commission, the one hundred twentieth (120th) day following the Filing Date, and (b) the date which is five (5) Business Days after the date on which the Commission informs the Company that (x) the Commission will not review the registration statement or (y) the Company may request the acceleration of the effectiveness of the registration statement.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

“Holder” and “Holders” shall mean the Buyer and any Permitted Transferee(s) (as defined below) of Registrable Securities (as defined below), Common Shares, Notes or Warrants that have not been sold to the public and to whom the registration rights conferred by this Agreement have been transferred in compliance with this Agreement and the Subscription Agreement; provided that neither such person nor any affiliate of such person is registered as a broker or dealer under Section 15(a) of the Exchange Act or a member of the Financial Industry Regulatory Authority, Inc.

 

  

  

  

 

“Permitted Transferee” means (i) Furniture Row, LLC (“Furniture Row”) and any wholly-owned subsidiary of Furniture Row, LLC, (ii) any person who owns a majority of the outstanding capital and voting interests of Furniture Row, (iii) the spouse or lineal descendants of any person described in clause (ii), (iv) any trust formed for the benefit of any person described in clause (ii) or for the benefit of the spouse or lineal descendants of any person described in clause (ii), or (v) corporations, limited liability companies, partnerships or other entity in which Furniture Row or any person described in clauses (ii) and (iii) owns a majority of the capital and voting interests.

 

The terms “register,” “registered” and “registration” shall refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act and the applicable rules and regulations thereunder, and the declaration or ordering of the effectiveness of such registration statement.

 

“Registrable Securities” shall mean (i) the Common Shares, (ii) any Conversion Shares, (iii) any Warrant Shares, and (iv) any other securities into which the Common Shares, the Warrant Shares and the Conversion Shares may be reclassified after the date hereof; provided, however, that all such securities shall cease to be Registrable Securities at such time as they have been sold under a registration statement or pursuant to Rule 144 under the Securities Act or otherwise or at such time as they are eligible to be sold without volume limitations pursuant to Rule 144.

 

“Registration Expenses” shall mean all expenses to be incurred by the Company in connection with each Holder’s registration rights under this Agreement, including, without limitation, all registration and filing fees, printing expenses, fees and disbursements of counsel for the Company, the reasonable attorney’s fees of Special Counsel (as defined below) which shall in no event exceed $20,000 per registration, blue sky fees and expenses, and the expense of any special audits incident to or required by any such registration.

 

 “Regulation D” shall mean Regulation D as promulgated pursuant to the Securities Act, and as may be amended from time to time.

 

“Securities Act” or “Act” shall mean the Securities Act of 1933, as amended.

 

“Selling Expenses” shall mean all underwriting discounts and selling commissions applicable to the sale of Registrable Securities, as well as all fees and disbursements of counsel for Holders other than Special Counsel.

 

“Special Counsel” means the single attorney selected by a majority in interest of the Initiating Holders (which attorney shall be reasonably acceptable to the Company) to represent the Holders’ interests in connection with the registrations contemplated by this Agreement.

“Warrant Shares” means shares of Common Stock issued (or issuable at the time in question) upon exercise of the Warrants.

 

2.             Demand Registration Rights.

 

(a)           Subject to the conditions of this Section 2, if at any time following the fifth (5th) anniversary date of the Subscription Agreement, the Company receives a written request from the Holders of more than fifty percent (50%) of the total number of Registrable Securities then outstanding (for purposes of this Section 2, the “Initiating Holders,” and such request the “Demand”) that the Company file a registration statement under the Act covering the registration for resale of the Registrable Securities, then the Company shall, within twenty (20) days of the receipt thereof, give written notice of such request to all Holders, and subject to the limitations of this Section 2, use commercially reasonable efforts to effect, as soon as practicable, the registration for resale under the Act of all the Registrable Securities that the Holders request to be registered in a written request received by the Company within twenty (20) days of the mailing of the Company’s notice pursuant to this Section 2(a).

 

  

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(b)           If the Initiating Holders intend to distribute the Registrable Securities covered by their Demand by means of an underwriting, they shall so advise the Company as a part of their Demand made pursuant to Section 2(a), and the Company shall include such information in its written notice to all Holders given pursuant to Section 2(a).  In such event, the right of any Holder to include its Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting (unless otherwise mutually agreed by a majority in interest of the Initiating Holders and such Holder) to the extent provided herein.  All Holders proposing to distribute their securities through such underwriting shall enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by a majority in interest of the Initiating Holders (which underwriter or underwriters shall be reasonably acceptable to the Company).  Notwithstanding any other provision of this Section 2, if the underwriter advises the Company that marketing factors require a limitation on the number of securities underwritten (including Registrable Securities), then the Company shall so advise all Holders of Registrable Securities that would otherwise be underwritten pursuant hereto, and the number of shares that may be included in the underwriting shall be allocated to the Holders of such Registrable Securities pro rata based on the number of Registrable Securities held by all such Holders (including the Initiating Holders).  In no event shall any Registrable Securities be excluded from such underwriting unless all other securities are first excluded.  Any Registrable Securities excluded or withdrawn from such underwriting shall be withdrawn from the registration.

(c)           Notwithstanding the foregoing, the Company shall not be required to effect a registration pursuant to this Section 2:

(A)          if, at the time of the Demand, the Common Stock is not registered pursuant  to Section 12(b) or Section 12(g) of the Exchange Act or the Company is not subject to the reporting requirements of Section 15(d) of the Exchange Act; or

(B)           in any particular jurisdiction in which the Company would be required to execute a general consent to service of process in effecting such registration, unless the Company is already subject to service in such jurisdiction and except as may be required under the Act; or

(B)           after the Company has effected two (2) registrations pursuant to this Section 2, and such registrations have been declared or ordered effective; or

(C)           if the Company shall furnish to the Holders requesting a registration statement pursuant to this Section 2 a certificate signed by the Company’s Chief Executive Officer or Chairman of the Board of Directors stating that, in the good faith judgment of the Board of Directors of the Company, it would be seriously detrimental to the Company and its stockholders for such registration statement to be effected at such time, the Company shall have the right to defer such filing for a period of not more than one hundred twenty (120) days after receipt of the Demand of the Initiating Holders, provided that such right shall be exercised by the Company not more than once in any twelve (12) month period and provided further that the Company shall not register any securities for the account of itself or any other stockholder during such one hundred twenty (120) day period (other than a registration relating to a corporate reorganization or transaction under Rule 145 of the Act, a registration on any form that does not include substantially the same information as would be required to be included in a registration statement covering the resale of the Registrable Securities, or a registration in which the only Common Stock being registered is Common Stock issuable upon conversion of debt securities that are also being registered).

 

  

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(d)           If:  (i) the registration statement required by Section 2 is not filed on or prior to its Filing Date (as defined below), or (ii) the Company fails to file with the Commission a request for acceleration of a registration statement in accordance with Rule 461 promulgated by the Commission pursuant to the Securities Act within five (5) Business Days of the date that the Company is notified (orally or in writing, whichever is earlier) by the Commission that such registration statement will not be “reviewed” or will not be subject to further review, or (iii) all of the Registrable Securities required by this Agreement to be included in such registration statement are not registered for resale on or before the Effectiveness Date and Rule 144 is not available to the Holders with respect thereto, or (iv) after the Effectiveness Date of a registration statement, such registration statement ceases for any reason to remain continuously effective as to all Registrable Securities required to be included in such registration statement for the time period specified in this Agreement, or the Holders are otherwise not permitted to utilize the prospectus therein to resell such Registrable Securities during the time period within which the Company is required to maintain the continuous effectiveness of the registration statement, for more than twenty (20) consecutive calendar days or more than an aggregate of forty-five (45) calendar days (which need not be consecutive calendar days) during any 12-month period, except to the extent that a suspension of the Registration Statement is otherwise permitted by this Agreement or caused by a Holder (any such failure or breach being referred to as an “Event,” and for purposes of clauses (i) and (iv), the date on which such Event occurs, and for purpose of clause (ii) the date on which such five (5) Business Day period is exceeded, and for purpose of clause (iv) the date on which such twenty (20) or forty-five (45) calendar day period, as applicable, is exceeded being referred to as “Event Date”), then, in addition to any other rights the Holders may have hereunder or under applicable law, on each monthly anniversary of each such Event Date (if the applicable Event shall not have been cured by such date) until the applicable Event is cured, from the date of the Event until the twelve-month anniversary of the Event, the Company shall pay to each Holder an amount in cash, as partial liquidated damages and not as a penalty, equal to one percent (1.0%) of the aggregate purchase price paid by such Holder pursuant to the Subscription Agreement for any unregistered Registrable Securities then held by such Holder (so long as such Holder has requested that such Registrable Securities be included in the registration statement and they are required by this Agreement to be included in the registration statement); provided, however, such partial liquidated damages shall not be paid with respect to any Registrable Securities which the Holder thereof may sell at such time under Rule 144 without any volume limitation and which have been held by such Holder for a period of more than one (1) year for purposes of Rule 144(d).  If the Company fails to pay any partial liquidated damages pursuant to this Section in full within seven (7) days after the date payable, the Company will pay interest thereon at a rate of eighteen percent (18%) per annum (or such lesser maximum amount that is permitted to be paid by applicable law) to the Holder, accruing daily from the date such partial liquidated damages are due until such amounts, plus all such interest thereon, are paid in full.  The partial liquidated damages pursuant to the terms hereof shall apply on a daily pro rata basis for any portion of a month prior to the cure of an Event.

(e)           If at any time the Commission takes the position that the offering of some or all of the Registrable Securities in a registration statement is not eligible to be made on a delayed or continuous basis under the provisions of Rule 415 under the Securities Act or requires any Holder to be named as an “underwriter,” the Company shall use its best efforts to persuade the Commission that the offering contemplated by the registration statement is a valid secondary offering and not an offering “by or on behalf of the issuer” as defined in Rule 415 and that none of the Holders is an “underwriter.”  The Holders shall have the right to participate or have their Special Counsel participate in any meetings or discussions with the Commission regarding the Commission’s position and to comment or have their Special Counsel comment on any written submission made to the Commission with respect thereto.  No such written submission shall be made to the Commission to which the Holders’ Special Counsel reasonably objects.  In the event that, despite the Company’s best efforts and compliance with the terms of this Section 2(e), the Commission refuses to alter its position, the Company shall (i) remove from the registration statement such portion of the Registrable Securities (the “Cut Back Shares”) and/or (ii) agree to such restrictions and limitations on the registration and resale of the Registrable Securities as the Commission may require to assure the Company’s compliance with the requirements of Rule 415 (collectively, the “Commission Restrictions”); provided, however, that the Company shall not agree to name any Holder as an “underwriter” in such registration statement without the prior written consent of such Holder.  Any cut-back imposed on the Holders pursuant to this Section 2(e) shall be allocated among the Holders on a pro rata basis and shall be applied first to any Warrant Shares and Conversion Shares, unless the Commission Restrictions otherwise require or provide or the Holders otherwise agree.  No liquidated damages shall accrue as to any Cut Back Shares except for any liquidated damages that would accrue, if at all, in accordance with Section 2d)(iv) hereof after the date on which the Company is able to effect the registration of such Cut Back Shares in accordance with any Commission Restrictions.

 

3.             Obligations of the Company.  Whenever required under Section 2 of this Agreement to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible:

 

  

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(a)           prepare and file with the SEC a registration statement with respect to such Registrable Securities within ninety (90) days of the Company’s receipt of the Demand (the “Filing Date”), which (assuming the Registrable Securities are not to be sold in an underwritten public offering) shall contain a “Plan of Distribution” in substantially the form attached hereto as Annex A, and use reasonable commercial efforts to cause such registration statement to become effective not later than the applicable Effectiveness Date, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective from the Effectiveness Date until the first to occur of (i) such time as all Registrable Securities covered by such registration statement have been sold or (ii) the earlier of (A) twelve (12) months following the effective date of such registration statement in the case of a registration statement on Form S-3 or (B) six (6) months  following the effective date of such registration statement in the case of a registration statement on Form S-1;

(b)           not less than three (3) Business Days prior to the filing of a registration statement or any pre-effective or post-effective amendment thereto, furnish to Special Counsel by e-mail copies of all such documents proposed to be filed, which documents (other than those incorporated or deemed to be incorporated by reference) will be subject to the review of such Special Counsel (and changes (if any) to correct appropriate information about the Holders).  The Company shall not be required to file a registration statement or any pre-effective amendments thereto to which the Holders of a majority of the Registrable Securities shall reasonably object in good faith in writing.

(c)           prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Act with respect to the disposition of all securities covered by such registration statement;

(d)           furnish to the Holders such number of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Act, and such other documents as they may reasonably request in order to facilitate the disposition of the Registrable Securities owned by them;

(e)           notify the Holders promptly (and, if requested, confirm such advice in writing) (i) when a registration statement has become effective and when any post-effective amendments and supplements thereto become effective, and (ii) of the issuance by the SEC or any state securities commission of any stop order suspending the effectiveness of a registration statement;

(f)           use commercially reasonable efforts to register and qualify the securities covered by such registration statement under such other state securities or Blue Sky laws of such jurisdictions as shall be reasonably requested by the Holders;

(g)           in the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter of such offering;

(h)           notify each Holder of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading;

(i)            provide a transfer agent and registrar for all Registrable Securities registered pursuant to this Agreement and a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such registration;

(j)            cooperate with the Holders and the managing underwriter, if any, to facilitate the timely preparation and delivery of certificates not bearing any restrictive legends representing the Registrable Securities to be sold, and cause such Registrable Securities to be issued in such denominations and registered in such names in accordance with the underwriting agreement prior to any sale of Registrable Securities to the underwriters or, if not an underwritten offering, in accordance with the instructions of the Holders, and instruct any transfer agent and registrar of Registrable Securities to release any stop transfer orders in respect thereto;

 

  

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(k)           deliver promptly to Special Counsel and each underwriter, if any, copies of all correspondence between the SEC and the Company, its counsel or auditors and all memoranda relating to discussions with the SEC or its staff with respect to the registration statement, other than those portions of any such memoranda which contain information subject to attorney-client privilege with respect to the Company, and, upon receipt of such confidentiality agreements as the Company may reasonably request, make reasonably available for inspection by the Holders or their Special Counsel, by any underwriter, if any, participating in any disposition to be effected pursuant to such registration statement and any attorney, accountant or other agent retained by any such underwriter, all pertinent financial and other records, pertinent corporate documents and properties of the Company, and cause all of the Company’s officers, directors and employees to supply all information reasonably requested by the Holders or their Special Counsel or such underwriter, attorney, accountant or agent in connection with such registration statement;

(l)            use commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of the registration statement; and

(m)           upon written request, furnish to the Holders without charge at least one conformed copy of the registration statement and any post-effective amendments thereto, including financial statements and schedules, all documents incorporated therein by reference and all exhibits (including those incorporated by reference).

 

Notwithstanding the provisions of this Section 3, the Company shall be entitled to postpone or suspend, for a reasonable period of time and upon written notice to the Holders (a “Suspension Notice”), the filing, effectiveness or use of, or trading under, any registration statement if the Company shall determine that any such filing or the sale of any securities pursuant to such registration statement would in the good faith judgment of the Board of Directors of the Company:

(A)          materially impede, delay or interfere with any material pending or proposed financing, acquisition, corporate reorganization or other similar transaction involving the Company for which the Board of Directors of the Company has authorized negotiations;

(B)           materially adversely impair the consummation of any pending or proposed material offering or sale of any class of securities by the Company; or

(C)           require disclosure of material nonpublic information that, if disclosed at such time, would be materially harmful to the interests of the Company and its stockholders; provided, however, that during any such period all executive officers and directors of the Company are also prohibited from selling securities of the Company (or any security of any of the Company’s subsidiaries or affiliates).

Any such postponement or suspension referred to in clauses (A) to (C) above shall not be considered an “Event” pursuant to Section 2 and no liquidated damages shall accrue or be payable with respect thereto.

 

In addition, any time period during which the filing of a post-effective amendment to a registration statement on Form S-1 and continuing until the time that such registration statement has been declared effective by the Commission shall not be considered an “Event” pursuant to Section 2 and no liquidated damages shall accrue or be payable with respect thereto.

In the event the Company files a registration statement on Form S-1 in satisfaction of a Demand pursuant to Section 2 due to its inability to use Form S-3, the Company shall have the option to undertake to register the Registrable Securities included in such registration statement on a new registration statement on Form S-3 after such form is available by filing a post-effective amendment to Form S-1 on Form S-3.  In the event the Company exercises such option, the Company shall have a period of up to seventy-five (75) days between the filing of the post-effective amendment to register such Registrable Securities on Form S-3 and the time that the registration statement on Form S-3 covering such Registrable Securities is declared effective by the Commission, which time period shall not be considered an “Event” pursuant to Section 2 and no liquidated damages shall accrue or be payable with respect thereto.

 

  

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In the event of the suspension of effectiveness of any registration statement pursuant to this Section 3, the applicable time period during which such registration statement is to remain effective shall be extended by that number of days equal to the number of days the effectiveness of such registration statement was suspended.

 

4.             Expenses of Registration.  All Registration Expenses in connection with any registration, qualification or compliance with registration pursuant to this Agreement shall be borne by the Company, and all Selling Expenses of a Holder shall be borne by such Holder.

 

5.             Indemnification.

 

(a)           Company Indemnity.  The Company will indemnify each Holder, each of its officers, directors, agents and partners, and each person controlling each of the foregoing, within the meaning of Section 15 of the Securities Act and the rules and regulations thereunder with respect to which registration, qualification or compliance has been effected pursuant to this Agreement, and each underwriter, if any, and each person who controls, within the meaning of Section 15 of the Securities Act and the rules and regulations thereunder, any underwriter, against all claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any final prospectus (as amended or supplemented if the Company files any amendment or supplement thereto with the SEC), registration statement filed pursuant to this Agreement or any post-effective amendment thereof or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of any prospectus or form of prospectus, in light of the circumstances under which they were made) not misleading, or any violation by the Company of the Securities Act or any state securities law or in either case, any rule or regulation thereunder applicable to the Company and relating to action or inaction required of the Company in connection with any such registration, qualification or compliance, and will reimburse each Holder, each of its officers, directors, agents and partners, and each person controlling each of the foregoing, for any reasonable legal fees of a single counsel and any other expenses reasonably incurred in connection with investigating and defending any such claim, loss, damage, liability or action, provided that the Company will not be liable in any such case to a Holder to the extent that any such claim, loss, damage, liability or expense arises out of or is based on (i) any untrue statement or omission based upon written information furnished to the Company by such Holder or underwriter (if any) therefor and stated to be specifically for use therein, (ii) any failure by any Holder to comply with prospectus delivery requirements or the Securities Act or the Exchange Act or any other law or legal requirement applicable to such Holder or any covenant or agreement contained in the Subscription Agreement or this Agreement applicable to such Holder, or (iii) an offer of sale of Conversion Shares or Warrant Shares occurring during a period in which sales under the registration statement are suspended as permitted by this Agreement.  The indemnity agreement contained in this Section 5(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Company (which consent will not be unreasonably withheld).

(b)           Holder Indemnity.  Each Holder will, severally but not jointly, if Registrable Securities held by it are included in the securities as to which such registration, qualification or compliance is being effected, indemnify the Company, each of its directors, officers, agents and partners, and any other stockholder selling securities pursuant to the registration statement and any of its directors, officers, agents, partners, and any person who controls such stockholder within the meaning of the Securities Act or Exchange Act and each underwriter, if any, of the Company’s securities covered by such a registration statement, each person who controls the Company or such underwriter within the meaning of Section 15 of the Securities Act and the rules and regulations thereunder, each other Holder (if any), and each of their officers, directors and partners, and each person controlling such other Holder(s) against all claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on (i) any untrue statement (or alleged untrue statement) of a material fact contained in any such final prospectus (as amended or supplemented if the Company files any amendment or supplement thereto with the SEC), registration statement filed pursuant to this Agreement or any post-effective amendment thereof or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of any prospectus or form of prospectus, in light of the circumstances under which they were made) not misleading, but only to the extent such statement or omission was furnished by the Holder to the Company in writing for the specific purpose of including the same in such registration statement, prospectus, or amendment or supplement thereto or (ii) failure by any Holder to comply with (A) the prospectus delivery requirements of the Securities Act after being advised by the Company that it has not satisfied the conditions of Rule 172 and that such Holder is, as a consequence, required to deliver a prospectus in connection with any disposition of Registrable Securities and after the Company has provided such Holder with a current prospectus to be used in connection with any such dispositions, (B) the Securities Act, (C) the Exchange Act, (D) any other law or legal requirement applicable to such Holder, or (E) any covenant or agreement contained in the Subscription Agreement or this Agreement applicable to such Holder, and will reimburse the Company, such stockholders, and such other Holder(s) and their directors, officers, agents and partners, underwriters or control persons for any reasonable legal fees or any other expenses reasonably incurred in connection with investigating and defending any such claim, loss, damage, liability or action, in each case to the extent, but only to the extent, that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such final prospectus (as amended or supplemented if the Company files any amendment or supplement thereto with the SEC), registration statement filed pursuant to this Agreement or any post-effective amendment thereof in reliance upon and in conformity with written information furnished to the Company by such Holder and stated to be specifically for use therein, and provided that the maximum amount for which such Holder shall be liable under this indemnity shall not exceed the net proceeds received by such Holder from the sale of the Registrable Securities pursuant to the registration statement in question.  The indemnity agreement contained in this Section 5(b) shall not apply to amounts paid in settlement of any such claims, losses, damages or liabilities if such settlement is effected without the consent of such Holder (which consent shall not be unreasonably withheld).

 

  

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(c)           Procedure.  Each party entitled to indemnification under this Section 5 (the “Indemnified Party”) shall give notice to the party required to provide indemnification (the “Indemnifying Party”) promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the defense of any such claim in any litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or any litigation resulting therefrom, shall be approved by the Indemnified Party (whose approval shall not be unreasonably withheld), and the Indemnified Party may participate in such defense at its own expense, and provided further that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Section 5 except to the extent that the Indemnifying Party is materially and adversely affected by such failure to provide notice.  No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent of each Indemnified Party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation.  Each Indemnified Party shall furnish such non-privileged information regarding itself or the claim in question as an Indemnifying Party may reasonably request in writing and as shall be reasonably required in connection with the defense of such claim and litigation resulting therefrom.

6.             Contribution.  If the indemnification provided for in Section 5 herein is unavailable to the Indemnified Parties in respect of any losses, claims, damages or liabilities referred to herein (other than by reason of the exceptions provided therein), then each such Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such losses, claims, damages or liabilities as between the Company on the one hand and any Holder(s) on the other, in such proportion as is appropriate to reflect the relative fault of the Company and of such Holder(s) in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations.  The relative fault of the Company on the one hand and of any Holder(s) on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or by such Holder(s).

 

  

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In no event shall the obligation of any Indemnifying Party to contribute under this Section 6 exceed the amount that such Indemnifying Party would have been obligated to pay by way of indemnification if the indemnification provided for under Section 5(a) or 5(b) hereof had been available under the circumstances.

 

The Company and the Holders agree that it would not be just and equitable if contribution pursuant to this Section 6 were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraphs.  The amount paid or payable by an Indemnified Party as a result of the losses, claims, damages and liabilities referred to in the immediately preceding paragraphs shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such Indemnified Party in connection with investigating or defending any such action or claim.  Notwithstanding the provisions of this Section, no Holder shall be required to contribute any amount in excess of the amount equal to the net proceeds received by such Holder from the sale of Registrable Securities pursuant to the registration statement in question.  No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

 

7.             Survival.  The indemnity and contribution agreements contained in Sections 5 and 6 shall remain operative and in full force and effect regardless of (i) any termination of this Agreement or the Subscription Agreement, and (ii) the consummation of the sale or successive resales of the Registrable Securities.

 

8.             Information by Holders.  As a condition to the obligations of the Company to complete any registration pursuant to this Agreement with respect to the Registrable Securities of each Holder, such Holder will furnish to the Company such information regarding itself, the Registrable Securities held by it and the intended methods of disposition of the Registrable Securities held by it as is reasonably required by the Company to effect the registration of the Registrable Securities.  At least ten Business Days prior to the first anticipated filing date of a registration statement for any registration under this Agreement, the Company will notify each Holder of the information the Company requires from that Holder whether or not such Holder has elected to have any of its Registrable Securities included in the registration statement. If the Company has not received the requested information from a Holder by the second (2nd) Business Day prior to the anticipated filing date, then the Company may file the registration statement without including Registrable Securities of that Holder.

 

9.             Further Assurances. Each Holder will cooperate with the Company, as reasonably requested by the Company, in connection with the preparation and filing of any registration statement hereunder, unless such Holder has notified the Company in writing of such Holder’s irrevocable election to exclude all of such Holder’s Registrable Securities from such registration statement.

 

10.           Suspension of Sales. Upon receipt of any Suspension Notice from the Company, each Holder will immediately discontinue disposition of Registrable Securities pursuant to the registration statement covering such Registrable Securities until (i) it receives copies of a supplemented or amended prospectus or (ii) the Company advises the Holder that a suspension of sales under Section 3 has terminated. If so directed by the Company, each Holder will deliver to the Company (at the expense of the Company) or destroy all copies in the Holder’ s possession (other than a limited number of file copies) of the prospectus covering such Registrable Securities that is current at the time of receipt of such notice.

 

11.           Replacement Certificates.  The certificate(s) representing the Registrable Securities held by the Buyer (or then Holder) may be exchanged by the Buyer (or such Holder) at any time and from time to time for certificates with different denominations representing an equal aggregate number of Registrable Securities, as reasonably requested by such Buyer (or such Holder) upon surrendering the same.  No service charge will be made for such registration or transfer or exchange.

12.           Transfer or Assignment.  Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns.  The rights granted to the Buyer by the Company under this Agreement to cause the Company to register the Registrable Securities may be transferred or assigned (in whole or in part) to a Permitted Transferee of the Common Shares, the Notes, or the Warrants, and all other rights granted to the Buyer by the Company hereunder may be transferred or assigned to any Permitted Transferee of the Common Shares, the Notes, the Warrants or the Registrable Securities; provided in each case that (i) the Company is given written notice by the Buyer at the time of or within a reasonable time after such transfer or assignment, stating the name and address of such Permitted Transferee and identifying the securities with respect to which such registration rights are being transferred or assigned; and provided further that such Permitted Transferee agrees in writing to be bound by the registration provisions of this Agreement, (ii) such transfer or assignment is not made under the registration statement or Rule 144, and (iii) such transfer is made according to the applicable requirements of the Subscription Agreement.

 

  

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13.           No Piggyback on Registrations.  Neither the Company nor any of its security holders (other than the Holders in such capacity pursuant hereto) may include securities of the Company in a registration statement filed pursuant to Section 2 other than the Registrable Securities, and the Company shall not after the date hereof enter into any agreement providing any such right to any of its security holders.

14.           Piggyback Registration Rights.

(a)           If (but without any obligation to do so) at any time after the fifth anniversary date of the Subscription Agreement the Company shall determine to prepare and file with the Commission a registration statement relating to an offering for its own account or the account of others under the Securities Act of any of its equity securities, other than on Form S-4 or Form S-8 (each as promulgated under the Securities Act) or their then equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with stock option or other employee benefit plans, then the Company shall send to each Holder written notice of such determination and, if within fifteen (15) days after receipt of such notice, any such Holder shall so request in writing, the Company shall include in such registration statement all or any part of such Registrable Securities (not already covered by an effective registration statement) such Holder requests to be registered, subject to customary underwriter cutbacks applicable to holders of registration rights (as described in Section 14(b) below) and subject to restrictions in applicable registration rights agreements.  The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 14 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration.

(b)           In connection with any offering involving an underwriting of equity securities being issued by the Company for its own account or for the account of others pursuant to a registration statement, the Company shall not be required under this Section 14 to include in such registration statement the Registrable Securities held by any Holder unless such Holder accepts and agrees to the terms of the underwriting as agreed upon between the Company and the underwriters selected by the Company (or by other persons entitled to select the underwriters) and enters into an underwriting agreement in customary form with such underwriters, and then only in such quantity as the underwriters determine in their sole discretion will not jeopardize the success of the offering by the Company.  If the total amount of Registrable Securities requested to be included in such offering exceeds the amount of Registrable Securities that the underwriters determine in their sole discretion is compatible with the success of the offering (after taking into account the maximum number of shares to be sold by the Company and the other selling stockholders, if any, in the offering), then the Company shall be required to include in the offering only that number of Registrable Securities that the underwriters determine in their sole discretion will not jeopardize the success of the offering.  In the event that the underwriters determine that less than all of the Registrable Securities requested to be registered can be included in such offering, then the Registrable Securities that are included in such offering shall be apportioned pro rata among the selling Holders based on the number of Registrable Securities held by all selling Holders or in such other proportions as shall mutually be agreed to by all such selling Holders.

15.           Miscellaneous.

(a)           Remedies.  The Company and the Buyer acknowledge and agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached.  It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent or cure breaches of the provisions of this Agreement and to enforce specifically the terms and provisions hereof, this being in addition to any other remedy to which any of them may be entitled by law or equity.

(b)           Governing Law and Arbitration.  This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado, other than such laws, rules, regulations and case law that would result in the application of the laws of a jurisdiction other than the State of Colorado.  In the event of a dispute between the Parties concerning the subject matter of this Agreement, the Parties shall resolve the dispute using the procedures and binding arbitration specified in Section 7 (g) of the Master Transaction Agreement dated as of the date hereof between the Company and the Buyer.

 

  

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(c)           Notices.  Any notices or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered:  (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by electronic mail or facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one Business Day after deposit with an overnight courier service, in each case properly addressed to the party to receive the same.  The addresses and facsimile numbers for such communications shall be:

 

If to the Company:

 

Liquidmetal Technologies, Inc.

30452 Esperanza

Rancho Santa Margarita, California  92688

Facsimile:          (949) 635-2188

Attention:         Tony Chung, CFO

Email:                 Tony.Chung@Liquidmetal.com

with a copy to:

Jones Day

1755 Embarcadero Road

Palo Alto, California 94303

Facsimile:          (650) 739-3900

Attention:         Robert T. Clarkson, Esq.

Email:                 rclarkson@jonesday.com

 If to Buyer:

Visser Precision Cast, LLC

Legal Office

5641 N. Broadway

Denver, Colorado 80216

Facsimile:          (303) 566-8099

Attention:         Gregory A. Ruegsegger, Esq.

Email:                 greg.ruegsegger@furniturerow.com

with a copy to:

Moye White LLP

16 Market Square, 6th floor

1400 16th Street

Denver, Colorado  80202-1486

Facsimile:          (303) 292-4510

Attention:         David C. Roos, Esq.

Email:                 david.roos@moyewhite.com

 

Written confirmation of receipt (A) given by the recipient of such notice or other communication, (B) mechanically or electronically generated by the sender’s facsimile machine containing the time, date, recipient facsimile number and an image of the first page of such transmission or (C) provided by an overnight courier service shall be rebuttable evidence of personal service, receipt by facsimile or receipt from an overnight courier service in accordance with clause (i), (ii) or (iii) above, respectively.

 

  

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(d)           Waivers.  No waiver by any party of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right accruing to it thereafter.  The representations and warranties and the agreements and covenants of the Company and the Buyer contained herein shall survive the registration and sale of the Registrable Securities.

(e)           Execution in Counterpart.  This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement, it being understood that all parties need not sign the same counterpart.

(f)            Signatures.  Facsimile signatures and signatures delivered in portable document format (PDF) shall be valid and binding on each party submitting the same.

 

(g)           Entire Agreement; Amendment.  This Agreement, together with the Subscription Agreement, the Warrants, and the agreements and documents contemplated hereby and thereby, contains the entire understanding and agreement of the parties, and may not be amended, modified or terminated except by a written agreement signed by the Company and the Holder of the Registrable Securities seeking registration of such securities.

(h)           Jury Trial.  EACH PARTY HERETO WAIVES THE RIGHT TO A TRIAL BY JURY.

(i)            Force Majeure.  The Company shall not be deemed in breach of its commitments under this Agreement if the Company is unable to fulfill its obligations hereunder in a timely fashion if the SEC is closed or operating on a limited basis as a result of the occurrence of a Force Majeure.  As used herein, “Force Majeure” means war or armed hostilities or other national or international calamity, or one or more acts of terrorism, which are having a material adverse effect on the financial markets in the United States.

(j)            Titles.  The titles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

(k)           No Strict Construction.  The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against any party.

(l)            Restriction on Sale of Registrable Securities.  The Buyer agrees that it will not, without the prior written consent of the Company (which consent may be withheld in the Company’s sole discretion), directly or indirectly, sell, transfer or otherwise dispose of all or any portion of the Registrable Securities, the Warrants or the Notes or sell, offer, contract or grant any option to sell (including, without limitation, any short sale), pledge, transfer, establish an open “put equivalent position” within the meaning of Rule 16a-1(h) under the Exchange Act with respect to the Registrable Securities, the Warrants or the Notes or otherwise dispose of any Registrable Securities, the Warrants or the Notes (collectively, the “Restricted Securities”), or publicly announce an intention to do any of the foregoing, for a period commencing on the date hereof and continuing through the close of trading on December 31, 2016 (the “Lock-up Period”); provided, that the foregoing restriction shall not apply to any transfer of Restricted Securities to a Permitted Transferee; provided, further, that any such Permitted Transferee executes and delivers to the Company an agreement to be bound by the foregoing restrictions.

 

  

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

	 	 	
COMPANY:

	  	 	  
	 	 	
LIQUIDMETAL TECHNOLOGIES, INC.

	  	 	  
	
By: 

	 	/s/ Tony Chung
	
Name:

	 	
Tony Chung

	
Title:

	 	
Chief Financial Officer

	  	 	  
	 	 	
BUYER:

	  	 	  
	 	 	
VISSER PRECISION CAST, LLC

	  	 	  
	
By: 

	 	/s/ Gregory A. Ruegsegger
	
Name:

	 	
Gregory A. Ruegsegger

	
Title:

	 	
 Vice President

 

  

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Annex A

 

Plan of Distribution

 

Each Selling Securityholder (the “Selling Securityholders”) of the common stock and any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their shares of common stock on the Over-the-Counter Bulletin Board or any stock exchange, or other market or trading facility on which the shares are traded or in private transactions.  These sales may be at fixed or negotiated prices.  A Selling Securityholder may use any one or more of the following methods when selling shares:

 

	 	
●

	
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;

	 	
●

	

block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;

	 	
●

	

purchases by a broker-dealer as principal and resale by the broker-dealer for its account;

	 	
●

	

an exchange distribution in accordance with the rules of the applicable exchange;

	 	
●

	

privately negotiated transactions;

	 	
●

	

settlement of short sales entered into after the effective date of the registration statement of which this prospectus is a part;

	 	
●

	

broker-dealers may agree with the Selling Securityholders to sell a specified number of such shares at a stipulated price per share;

	 	
●

	

through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;

	 	
●

	

a combination of any such methods of sale; or

	 	
●

	

any other method permitted pursuant to applicable law.

 

The Selling Securityholders may also sell shares under Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), if available, rather than under this prospectus.

 

Broker-dealers engaged by the Selling Securityholders may arrange for other brokers-dealers to participate in sales.  Broker-dealers may receive commissions or discounts from the Selling Securityholders (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a customary brokerage commission in compliance with FINRA NASD Rule 2440; and in the case of a principal transaction a markup or markdown in compliance with NASD IM-2440.

 

In connection with the sale of the common stock or interests therein, the Selling Securityholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the common stock in the course of hedging the positions they assume.  The Selling Securityholders may also sell shares of the common stock short and deliver these securities to close out their short positions, or loan or pledge the common stock to broker-dealers that in turn may sell these securities.  The Selling Securityholders may also enter into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities which require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).

 

The Selling Securityholders and any broker-dealers or agents that are involved in selling the shares may be deemed to be “underwriters” within the meaning of the Securities Act in connection with such sales.  In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act.  Each Selling Securityholder has informed the Company that it does not have any written or oral agreement or understanding, directly or indirectly, with any person to distribute the common stock.

 

  

Annex A-1

  

 

Because Selling Securityholders may be deemed to be “underwriters” within the meaning of the Securities Act, they will be subject to the prospectus delivery requirements of the Securities Act including Rule 172 thereunder.  In addition, any securities covered by this prospectus which qualify for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than under this prospectus.  There is no underwriter or coordinating broker acting in connection with the proposed sale of the resale shares by the Selling Securityholders.

 

The resale shares will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws.  In addition, in certain states, the resale shares may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.

 

Under applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale shares may not simultaneously engage in market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement of the distribution.  In addition, the Selling Securityholders will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of shares of the common stock by the Selling Securityholders or any other person.  We will make copies of this prospectus available to the Selling Securityholders and have informed them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with Rule 172 under the Securities Act).

 

 

Annex A-2ex10_37.htm

Exhibit 10.37

 

VPC SUBLICENSE AGREEMENT

This VPC SUBLICENSE AGREEMENT (this “Agreement”) is made effective as of June 1, 2012 (the “Effective Date”), by and between Liquidmetal Technologies, Inc., a Delaware corporation having its principal place of business at 30452 Esperanza, Rancho Santa Margarita, California 92688 (“LMT”), and Visser Precision Cast, LLC, a Colorado limited liability company having its principal place of business at 6275 E. 39th Street, Denver, CO 80207 (“VPC”).  LMT and VPC are parties to that certain Master Transaction Agreement (“MTA”) and that certain Manufacturing Services Agreement (“MSA”), each of even date herewith.  Capitalized terms used in this Agreement without separate definition shall have the meanings specified in the MTA.  LMT and VPC are each referred to individually as a “Party,” and collectively as the “Parties,” to this Agreement.

RECITALS

WHEREAS, LMT, Crucible Intellectual Property, LLC (“Crucible”), Liquidmetal Coatings, LLC, a Delaware limited liability company (“LMC”), and Apple Inc., a California corporation (“Apple”), previously entered into a Master Transaction Agreement, dated August 5, 2010 (the “Apple Agreement”), pursuant to which, among other provisions, LMT contributed, transferred, and assigned substantially all of its intellectual property assets to Crucible;

WHEREAS, LMT and Crucible entered into an Exclusive License Agreement, dated August 5, 2010, pursuant to which, among other provisions, Crucible granted an exclusive license back to LMT to the LMT Technology for use in fields other than Consumer Electronic Products (as defined below) (the “LMT License”); and

WHEREAS, LMT hereby desires to sublicense rights to the LMT Technology to VPC on the terms and conditions set forth herein;

NOW THEREFORE, in consideration of the provisions and agreements of the Parties as set forth in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the Parties, the Parties agree as follows:

ARTICLE 1

DEFINITIONS

In addition to the terms defined in the MTA:

 

1.1           “Additional Excluded Fields” shall mean those fields of use covered by exclusive licenses from Licensor or Crucible under the licenses and sublicenses of the LMT Technology granted by Licensor or Crucible and listed in Attachment A to this Agreement, other than the license from Crucible to Apple.  Each of the fields of use described in the preceding sentence shall remain within the defined term “Additional Excluded Fields” only during such period as there remains in effect an exclusive license covering such field of use that was granted by Licensor or Crucible and was in full force and effect as of the Effective Date (including any renewals or extensions of any such license, which renewal or extension was made in the sole discretion of the licensee, without Licensor or Crucible exercising any right of approval or consent to such renewal or extension or failing to exercise any right that Licensor or Crucible might have had to terminate such license or otherwise prevent such renewal or extension).  To the extent any such field of use drops out of the defined term “Additional Excluded Fields” on or after the Effective Date, such field of use shall, from that time forward, automatically and without further action of the Parties, be included within the VPC Fields.

 

  

  

  

 

1.2           “Consumer Electronic Products” shall mean personal computers (portable and desktop); tablet or slate style computing devices; handheld electronic and/or communication devices (e.g., smartphones, digital music players, multi-function devices, etc.); any device whose function includes the creation, storage or consumption of digital media; any component or sub-component in any Consumer Electronic Product; and any accessory that is the same or similar to an accessory made or sold by or on behalf of Apple (regardless of when Apple sold or started to sell such accessory) that is suitable for use with any Consumer Electronic Product. Notwithstanding the foregoing, “Consumer Electronic Products” shall not include: (i) products (except for any product that is capable of interacting or interfacing with a Consumer Electronic Product) that are powered by electricity or batteries but that do not in any way involve the creation, storage, consumption, use, viewing, transmission, or processing of digital media or digital information and do not involve the use of wireless communication networks. Products that fall into this category include, without limitation, electric-powered and/or battery-powered drills, hand tools and watches (i.e. a wrist-worn device whose sole function is to display the time of day); (ii) medical devices and other products that are not the same or similar to any Apple product (regardless of when Apple sold or started to sell such product) and that are used exclusively for the diagnosis and/or treatment of human or animal health conditions; or (iii) products or components thereof that are not the same as or similar to any Apple product (regardless of when Apple sold or started to sell such product) or component of any Apple product and that are made solely for, and sold solely into, the defense/military, automotive, medical, or industrial markets.

1.3           “Licensed Products” shall mean any product (excluding Consumer Electronics Products) that is manufactured using the LMT Technology and/or that otherwise uses the LMT Technology.

1.4           “Licensee” shall mean, individually and collectively, VPC and any Subsidiary thereof.

1.5           “Licensor” shall mean LMT.

1.6           “Subsidiary” with respect to a Party shall mean any corporation, partnership or other entity, now or hereafter, (i) greater than fifty percent (50%) of whose outstanding shares or securities entitled to vote for the election of directors or similar managing authority is directly or indirectly owned or controlled by a Party hereto, or (ii) a beneficial interest of greater than fifty percent (50%) coupled with ownership or control (either direct or indirect) of greater than fifty percent (50%) of whatever interest represents the right to make executive and/or operational decisions for such entity; provided, however, that in each case such corporation, partnership or other entity shall be deemed to be a Subsidiary only so long as all requisite conditions of being a Subsidiary are met.

1.7           “VPC Fields” shall mean all fields of use other than Consumer Electronic Products and the Additional Excluded Fields.

ARTICLE 2

LICENSE GRANT, CONSIDERATION, AND ENFORCEMENT

2.1           VPC Fields License Grant.  Subject only to Section 4.2 of this Agreement, Licensor grants to Licensee a fully paid-up, royalty-free, irrevocable, perpetual, worldwide, nonexclusive license under the LMT Technology in the VPC Fields to use, reproduce, publish, display, distribute, perform, exploit and disclose the LMT Technology, and/or to make and have made, assemble and have assembled, use, sell, offer to sell, import and offer to import, license and offer to license, distribute and offer to distribute, repair, reconstruct, practice, and maintain Licensed Products, and/or to perform any act or step that incorporates, utilizes, embodies or reflects, any inventions claimed in the LMT Technology, including, without limitation, any such activities that would, absent such a license, subject a person or other legal entity to a claim of direct infringement, contributory infringement, inducing infringement, or any other type of infringement.  Licensee’s right to use the LMT Technology in the VPC Fields shall include, without limitation, the right to modify and create derivative works from the LMT Technology.  Such Licensee modifications and derivative works to the LMT Technology and all Intellectual Property Rights therein (the “Licensee Modifications”) shall be owned solely and exclusively by Licensee.  Licensee shall further have the right to grant sublicenses to use the LMT Technology in the VPC Fields.  Nothing in this Agreement shall give Licensee or its sublicensees any right to use any portion of the LMT Technology in the field of Consumer Electronic Products.

 

  

2

  

 

2.2           Consideration.  Licensor acknowledges and agrees that Licensor has received additional consideration for the license and rights granted to Licensee herein by way of Licensee’s execution and delivery of the MTA and the other Transaction Documents.

2.3           Enforcement.

2.3.1           As required pursuant to the Apple Agreement, Licensee acknowledges that Licensor and Crucible have the right to take any and all actions necessary to defend the LMT Technology created, conceived, invented, or discovered before the end of the Capture Period, as such term is defined in the Apple Agreement, including any extension of the Capture Period, in any litigation or administrative proceedings in which Licensee is a party.  In addition, Licensee acknowledges the sole and exclusive rights of Apple to control patent prosecution for inventions and patents, as more fully set forth in Section 5 of the Apple Agreement, as to LMT Technology created, conceived, invented, or discovered before the end of the Capture Period, including any extension of the Capture Period.

2.3.2           Subject to the rights of Apple as described in Section 2.3.1, Licensor shall use reasonable efforts in its business judgment to prosecute and maintain the Intellectual Property Rights included within the LMT Technology, including without limitation any patent rights.  As between Licensor and Licensee, except under the specific circumstances referenced in Section 2.3.4, Licensor shall be solely responsible for the payment of all fees, expenses and other charges associated with the prosecution and maintenance of the Intellectual Property Rights within the LMT Technology.

2.3.3           Licensor shall notify Licensee if Licensor learns of any potentially patentable inventions identified in Section 5 (e) of the Apple Agreement for which both Apple and Crucible have decided (i) not to prosecute the application for a patent thereof and not to require that such invention be treated as a trade secret, or (ii) to prosecute the application for a patent thereof but not in all jurisdictions in which an application for a filing or registration may be made.  Licensor shall also notify Licensee if Licensor determines that there are any potentially patentable inventions first created, conceived, invented or discovered after the Capture Period, including any extension of the Capture Period, for which Licensor has decided (iii) not to prosecute the application for a patent thereof and not to require that such invention be treated as a trade secret, or (iv) to prosecute the application for a patent thereof but not in all jurisdictions in which an application for a filing or registration may be made.  Each such notice shall include a reasonably detailed description of the applicable invention.  The inventions described in this Section 2.3.3 are referred to as the “Unpatented LMT Technology”.

2.3.4           Licensee may cause Licensor to file and prosecute a patent application for the Unpatented LMT Technology (at Licensee’s cost and expense, as set forth below), or Licensee may cause Licensor to file patent applications in jurisdictions not originally selected to be pursued by Licensor, Apple or Crucible, as the case may be, or file a Patent Cooperation Treaty application for the Unpatented LMT Technology.  Licensee may also (1) take over the control of any patent prosecution of any patent application that Licensor, Apple and Crucible, as the case may be, have determined is to be abandoned; (2) cause Licensor to file a continuation, divisional or continuation-in-part application based on a pending patent application if Licensor, Apple and Crucible, as the case may be, determine not to file the continuation, divisional or continuation-in-part application; (3) pay an annuity fee for a foreign patent application if Licensor, Apple and Crucible, as the case may be, have determined not to pay the annuity fee; and (4) pay a maintenance fee for a United States patent or a foreign patent for Unpatented LMT Technology if Licensor, Apple and Crucible, as the case may be, have determined not to pay the maintenance fee.  Licensor shall disclose in writing any of the determinations by Licensor, Apple or Crucible as described in the preceding sentence promptly after any such determination is made, and in any event Licensor shall provide Licensee with sufficient notice of each such determination that Licensee has a reasonable opportunity to evaluate the matter and take any of the acts described in this Section 2.3.4 on a timely basis.  Any such activities that Licensee chooses to undertake shall be for the benefit of Licensor or Crucible, as the case may be, at Licensee’s sole cost and expense.  In connection with any patent application as to which Licensor has decided not to prosecute, Licensee shall retain intellectual property counsel reasonably acceptable to Licensor.  Licensor employees shall provide cooperation and support to Licensee and patent counsel to support patent prosecution activities for inventions, current and future patent applications and patents included within the Unpatented LMT Technology.  This cooperation and support will be provided at no charge to Licensee.  The patent counsel engaged by Licensee shall have the sole discretion to determine when the cooperation and support is necessary to support the patent prosecution activities.  Nothing in this paragraph requires Licensee to conduct any such activities.  Notwithstanding anything herein to the contrary, the rights of Licensee pursuant to this Section 2.3.4 with respect to Unpatented LMT Technology described in the first sentence of Section 2.3.3 shall be subject to the receipt of prior written consent from Apple to having the applicable inventions included within the Unpatented LMT Technology.  Upon request from Licensee, Licensor shall request such consent from Apple and, if such consent is granted, shall take such acts as may be required in order to permit Licensee to exercise the rights set forth in this Section 2.3.4.

 

  

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2.4           Release.  Licensor, on behalf of itself and its successors and assigns, hereby releases, acquits and forever discharges Licensee, its affiliates, and all of their respective current and former predecessors, successors, agents, attorneys, employees, contractors, subcontractors, officers, directors and customers, from any and all claims of infringement or misappropriation of the LMT Technology that occurred prior to the Effective Date.

2.5           Trademark Usage.  In the event that Licensee desires to utilize any trademark or service mark included in the LMT Technology (collectively, the “Trademark”), then Licensee will comply with the following restrictions with respect to its use of the Trademark:  (i) all stylized use of the Trademark shall be solely in the original logotype identified by Licensor, except as otherwise agreed in writing by Licensor, (ii) Licensee agrees not to affix the Trademark to products other than the Licensed Products, (iii) Licensee will not utilize the Trademark to refer to any materials other than amorphous metal alloys or composite materials included within the LMT Technology, (iv) Licensee agrees not to modify the Trademark or change the appearance of any stylized or logo form of the Trademark, (v) the “®” icon shall always follow the Trademark, whenever appropriate, and (vi) Licensee agrees not to take any other action that would be reasonably expected to undermine the enforceability of the Trademark.

2.6           Covenant for Continuation of License Rights.  Licensee acknowledges that as part of the Apple Agreement, Licensor has granted Apple a security interest through August 5, 2012 in the LMT Technology created, conceived, invented, or discovered before the end of the Capture Period, including any extension of the Capture Period, which is licensed to Licensee pursuant to this Agreement (the “Apple Security Interest”), and that enforcement of the Apple Security Interest could result in a transfer of such LMT Technology.  Licensee further acknowledges that pursuant to the Apple Agreement and the LMT License, if the Apple Security Interest is enforced and, as a result of such enforcement, any of the LMT Technology created, conceived, invented, or discovered before the end of the Capture Period, including any extension of the Capture Period, is transferred to any person or entity, (a) such person or entity may acquire or otherwise receive such LMT Technology free and clear of all rights, powers and privileges of Licensee under this Agreement, and (b) this Agreement may be terminated to the extent such LMT Technology shall have been so acquired upon notice from such acquirer.  Notwithstanding the foregoing, Licensor represents, warrants and covenants that the license granted to VPC pursuant to this Agreement with respect to the LMT Technology created, conceived, invented, or discovered before the end of the Capture Period, including any extension of the Capture Period, shall remain in full force and effect without termination for any reason, including without limitation any termination as described in this Section 2.6, and that Licensee shall have the continuing right to exercise such license in perpetuity.  Any termination or partial termination of this Agreement, including any termination due to the enforcement of the Apple Security Interest shall be a material breach of this Agreement, in which case Licensee shall have a claim against Licensor for all damages incurred by Licensee in connection with such breach and such termination or partial termination, including without limitation the damages described in Section 4.2 below.

 

  

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2.7           Sublicense Obligations.  If Licensee elects to grant any sublicense(s) under this Agreement, any such sublicense agreement must include the following: (a) a clear statement that, notwithstanding any other provisions in such sublicense, nothing in such sublicense shall give the sublicensee any right to use any portion of the LMT Technology created, conceived, invented, or discovered before the end of the Capture Period, including any extension of the Capture Period, in the field of Consumer Electronic Products (and Licensee shall include in each sublicense agreement the full definition of “Consumer Electronic Products” that is specified herein for reference); (b) a clear reservation of Licensor’s right to take any and all actions necessary to defend the LMT Technology created, conceived, invented, or discovered before the end of the Capture Period, including any extension of the Capture Period, in any litigation or administrative proceedings in which the sublicensee is a party; and (c) a clear reservation of Crucible’s right to take any and all actions necessary to defend the LMT Technology created, conceived, invented, or discovered before the end of the Capture Period, including any extension of the Capture Period, in any litigation or administrative proceedings in which the sublicensee is a party.

ARTICLE 3

TERM

3.1           Term.  The term of this Agreement commences on the Effective Date and shall continue in perpetuity.  This Agreement shall not be terminable by the Parties, except under the limited circumstances described in Section 4.2.

ARTICLE 4

COVENANT NOT TO SUE AND OTHER OBLIGATIONS

4.1           Covenant Not to Sue.  Except as set forth below in this Section 4.1, Licensor, on behalf of itself and its heirs, executors, successors, assigns, agents and all other persons and entities (other than Crucible) associated with it, covenants that it will not at any time, whether now or in the future, sue, file, assist, or participate in, or cause, assert, or induce any other person or entity to sue, file, assist, or participate in any claim or allegation against any of the following for infringement of Intellectual Property Rights of any of the LMT Technology within the VPC Fields: (i) Licensee; or (ii) Licensee’s past, present and future owners, shareholders, parents, subsidiaries, successors, assigns, divisions, units, officers, directors, employees, agents, attorneys, or representatives, or (iii) Licensee or such parties’ respective past, present and future direct and indirect vendors, suppliers, manufacturers, distributors, customers, or end users (collectively, “Licensee-Related Entities”) in connection with any act by a Licensee-Related Entity at the direction of or on behalf of Licensee or related to or in connection with any Licensee-branded or Licensee-licensed product.  This covenant not to sue does not inure to the benefit of any third parties for their conduct that is unrelated to Licensee.  Licensor shall not be in breach of this subsection (a) if Licensor participates as a party in any litigation proceedings where any of the Intellectual Property Rights included in the LMT Technology are asserted by another party against Licensee, provided that a court of competent jurisdiction shall have ruled that Licensor’s participation as a party is necessary to such proceedings and shall have ordered Licensor to participate as a party, or (b) to the extent that Licensor brings a suit or proceeding to enforce any restriction to which the Parties have otherwise agreed in writing which limits VPC’s exercise of the license rights granted in this Agreement.

 

  

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4.2           Rejection or Termination.  Should Licensor reject this license under section 365(n) of the Bankruptcy Code, Licensee may treat the license as terminated, in which case Licensee shall have a claim against Licensor for all damages incurred by Licensee in connection with such termination.  The Parties agree that such damages shall include without limitation damages relating to the loss of the licenses and rights granted to Licensee under this Agreement, the loss or diminution in value of Licensee’s investment in Licensor pursuant to the MTA and/or the Transaction Documents, plus all amounts outstanding under any loan from Licensee to Licensor pursuant to the MTA and/or the Transaction Documents, plus any amounts paid to purchase “Machines” (as such term is defined in the MSA) (less any depreciation on such Machines as shown in Licensee’s financial statements, which financial statements shall be conclusive for purposes of establishing such amounts), plus interest on all such amounts invested, loaned or paid by Licensee from the date of such investment or loan or payment until the date on which Licensee recovers payment in full from Licensor of all damages hereunder and under the MTA and the Transaction Documents at a rate per annum equal to the greater of (i) 10% or (ii) the “prime rate” as reported in The Wall Street Journal in effect from time to time plus two percent.  Alternatively, should Licensor reject this license under section 365(n) of the Bankruptcy Code, Licensee may elect, under section 365(n) to continue as licensee under this Agreement.

4.3           Licensor Obligations. Licensor shall (a) fully perform all obligations and discharge all liabilities under any licenses, sublicenses and other agreements included in or otherwise affecting the LMT Technology (including without limitation wherever there is a reference in this Section 4.3 to agreements “affecting” the LMT Technology, all obligations under the Apple Agreement (and all instruments or agreements entered in to by Licensor pursuant to or in connection with the Apple Agreement) as and when the same are to be performed; (b) without limiting the generality of the foregoing, pay, prior to delinquency, all insurance premiums, taxes, charges, liens and assessments against the LMT Technology and all amounts that become due and payable under any trade secrets, licenses, sublicenses and other agreements included in or otherwise affecting the LMT Technology; (c) promptly provide Licensee with copies of all invoices received with respect to payments described in the preceding clause (b) and notice of any payments made pursuant to this Section 4.3 upon making such payment, and upon request of Licensee, provide copies of documents as may be reasonably necessary or advisable to confirm that Licensor has performed the obligations set forth in this Section 4.3; (d) promptly following receipt thereof, deliver copies of all notices alleging any breach or default under or asserting any adverse claim in respect of any trade secrets, licenses, sublicenses and other agreements included in or otherwise affecting the LMT Technology; and (e) upon request from Licensee, provide Licensee with reasonably detailed reports and copies of documents as may be reasonably necessary or advisable to confirm that Licensor has performed the foregoing obligations.  Licensor hereby irrevocably appoint Licensee as its true attorney in fact to perform (at Licensor’s expense) any of the following powers, which are coupled with an interest, and may be exercised from time to time by Licensee’s officers and employees, or any of them, to perform any obligation of Licensor under this Section 4.3, in Licensor’s name or otherwise, including without limitation obligations under the Apple Agreement and all instruments or agreements entered into by Licensor pursuant to or in connection with the Apple Agreement.  For avoidance of doubt, Licensee shall have no obligation hereunder to exercise the rights granted pursuant to the preceding sentence.

 

  

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4.4           Right of First Refusal upon License or Sale.  Licensee shall have a right of first refusal (“ROFR”) with respect to a license, sublicense, sale or other transfer by Licensor of the LMT Technology or any portion thereof as described in this Section 4.4.  In the event that the Board of Directors or similar governing body of Licensor (the “Board”) approves Licensor proceeding with a bona fide letter of intent, term sheet, other proposal or written agreement of any form, and whether proposed by Licensor or by a third-party (each, an “Offer”) concerning a license, sublicense, sale or other transfer of the LMT Technology or any portion thereof other than a license to a machine or alloy vendor (a “Technology Transaction”), that management of Licensor or the Board has determined that it would be willing to accept, then prior to accepting any such Offer or executing any binding agreement with respect to such Technology Transaction, Licensor shall provide Licensee with written notice of the Technology Transaction, which notice shall include a written summary of the principal terms, the structure of the transaction and conditions, a copy of any such Offer and any agreements (or the most recent drafts thereof) to effect such Technology Transaction (collectively, the “ROFR Notice”).  Licensee shall have thirty (30) days from the date of receipt of the ROFR Notice (the “Notice Period”) to notify Licensor in writing (the “Notice of Exercise”) whether it has elected to exercise its ROFR to acquire the offered rights in the LMT Technology under substantially the terms set forth in the Offer.  If, as of the expiration of the Notice Period, Licensee fails to provide a Notice of Exercise, Licensee shall be deemed to have elected not to exercise the ROFR with respect to such Technology Transaction.  If Licensee provides a Notice of Exercise within the Notice Period, the Parties shall work together in good faith to negotiate and execute a definitive agreement to consummate the Technology Transaction under substantially the terms set forth in the Offer.  Notwithstanding any provision herein to the contrary, if the Offer specifies (a) payment of consideration in other than United States money, Licensee shall have the right to acquire the offered rights in the LMT Technology for the United States money equivalent of the specified consideration; and (b) a manner, time, terms, or conditions that cannot be complied with by Licensee without unreasonable effort, Licensee shall have the right to acquire the offered rights in the LMT Technology by complying with a reasonable equivalent of the specified terms or conditions.

ARTICLE 5

CONFIDENTIALITY

5.1           The disclosure and use of all confidential information pursuant to this Agreement, including without limitation the terms of this Agreement, shall be subject to the terms of the Parties’ Mutual Non-Disclosure Agreement to be executed concurrently herewith, the terms of which are incorporated by reference herein (the “Confidentiality Agreement”).

ARTICLE 6

REPRESENTATIONS, WARRANTIES, AND COVENANTS

6.1           Incorporation from MTA.  Section 1(b), Section 1(d), Section 1(e), and Section 2(b) of the MTA and any related definitions for any terms used in any such Sections are hereby incorporated by reference into this Agreement.

6.2           Apple Agreement.  Licensor represents, warrants, and covenants that Licensor is, shall be and shall remain, in compliance with all of its obligations to Apple under the Apple Agreement and all instruments or agreements entered in to by Licensor pursuant to or in connection with the Apple Agreement.

6.3           LMT Technology Licensees.  Licensor represents, warrants, and covenants that as of the Effective Date the only other licensees and sublicensees of the LMT Technology are those listed in Attachment A to this Agreement.

 

  

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6.4           Non-Solicitation.  Licensor represents, warrants, and covenants that if Licensor shall license, sublicense, sell or otherwise transfer the LMT Technology to any third party after the Effective Date of this Agreement (each such third party, a “LMT Licensee”), Licensor shall include, as a condition to any such license, sublicense, sale or transfer, a covenant that so long as such license, sublicense, sale or transfer remains in effect neither the LMT Licensee nor its affiliates or subsidiaries shall directly or indirectly solicit, recruit or hire (either as an employee or as a contractor), or attempt to solicit, recruit or hire (either as an employee or as a contractor) any of Licensee’s employees or contractors, or any person who was employed or engaged as an employee or contractor by Licensee at any time within the preceding one year period (such persons being hereinafter referred to as an “Agent”); provided, however, that this shall not prohibit the LMT Licensee from advertising for open positions provided that such advertisements are not targeted solely at the Agents of Licensee.  Each such agreement with an LMT Licensee shall further provide that so long as such license, sublicense, sale or transfer remains in effect, neither the LMT Licensee nor its affiliates or subsidiaries shall directly or indirectly, for its own benefit or for the benefit of a third party, induce or attempt to induce any Agent of Licensee to leave such Agent’s position with Licensee, or in any other way attempt to interfere with the employment, consulting or business relationship between Licensee and any Agent of Licensee.  LMT shall cause Licensee to be named a third party beneficiary of such provisions under each such agreement with an LMT Licensee, with the explicit right for Licensee to enforce such restrictions directly against the LMT Licensee.

6.5           Inventions and Improvements.  Licensor shall notify Licensee periodically (not less frequently than quarterly) of any improvements or additions to the LMT Technology developed or acquired by or on behalf of Licensor or Crucible.  All such improvements or additions shall, without further action of the Parties, be included within the LMT Technology and thus within the license granted to Licensee pursuant to this Agreement.  Except as specifically set forth in this Section 6.5, each of the Parties shall retain all rights to all Intellectual Property and all Intellectual Property Rights that such Party owns or has licensed from a third party (including without limitation pursuant to sub-licenses), or that such Party otherwise has a right to use, both as of the Effective Date or at any time thereafter, including without limitation any and all Intellectual Property and Intellectual Property Rights that, as between the Parties, are developed exclusively by or on behalf of such Party on or after the Effective Date.  In the case of LMT, all such Intellectual Property and Intellectual Property Rights shall be included within the term “LMT Technology” and shall be licensed to VPC under this Agreement.  Notwithstanding anything herein to the contrary, but subject to the last two sentences of this Section 6.5, any Intellectual Property or Intellectual Property Rights that are developed jointly by the Parties after the Effective Date shall be jointly owned by Licensor and Licensee and shall automatically and without further action by the Parties be included in the LMT Technology licensed to Licensee pursuant to this Agreement.  The Parties agree to cooperate and cause their employees and contractors to cooperate in the preparation and prosecution of patent applications relating to any such jointly developed Intellectual Property and Intellectual Property Rights. Notwithstanding the foregoing, in order to avoid any confusion, misunderstanding or dispute, and to provide certainty as to which developments, if any, LMT will have joint ownership with VPC, LMT shall have no right to joint ownership, and will make no claim of joint ownership as to any Intellectual Property or Intellectual Property Rights developed by or on behalf of VPC or jointly with VPC unless prior to the development of such rights, LMT  and VPC have executed a joint development agreement which (a) specifically identifies the joint development project, (b) specifies LMT’s anticipated contribution to such joint development project, and (c) specifically states that LMT will have joint ownership rights with VPC to the Intellectual Property and Intellectual Property Rights that result from such project. To the extent, if any, that LMT contributes to the development of Intellectual Property or Intellectual Property Rights under the circumstances described in the foregoing sentence without an executed development agreement which meets conditions (a) through (c) in the foregoing sentence, then such jointly developed Intellectual Property and Intellectual Property Rights and LMT’s contribution to such joint development (but not any Intellectual Property or Intellectual Property Rights owned by LMT prior to such development) shall be owned exclusively by VPC, regardless of inventorship, and LMT hereby assigns to VPC, and will cause its employees, contractors, representatives, officers and directors to assign to VPC all right, title and interest in and to LMT’s contribution to such Intellectual Property and Intellectual Property Rights. Nothing in this Section 17.1 shall preclude LMT from asserting a claim that any Intellectual Property or Intellectual Property Rights were developed exclusively by LMT or licensed by LMT from others.

  

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ARTICLE 7

INDEMNIFICATION

7.1           Indemnification.  Licensor shall defend, indemnify and hold Licensee and its directors, officers, affiliates, employees, agents, successors and assigns (each, an “indemnified party”) harmless from and against any and all liability, loss, expense (including without limitation reasonable attorney’s fees), or claims for injury or damages (i) incurred by an indemnified party as a result of (A) any inaccuracy in or breach of the representations, warranties or covenants made by Licensor in this Agreement, or (B) any act or omission by any of Licensor or its directors, officers or employees that violates any law or constitutes tortious acts or omissions; or (ii) incurred by any indemnified party or asserted against any indemnified party by any third party arising out of, in connection with, or as a result of (A) the execution or delivery of this Agreement, the performance by the Parties hereto or thereto of their respective obligations hereunder or the consummation of the transactions contemplated hereby, (B) Licensee’s use of the LMT Technology or rights under this Agreement, and (C) any claim that the LMT Technology or the use of the LMT Technology, infringes upon or otherwise violates any rights, including, without limitation, any Intellectual Property Rights, of any third party.

7.2           Notice of Claims. If any party is entitled to indemnification under Section 7.1, Licensee will give prompt written notice to Licensor of any matters giving rise to a claim for indemnification; provided that the failure to provide such notice shall not relieve Licensor of its obligations under this Section 7 except to the extent that Licensor is actually prejudiced by such failure to give notice.

7.3           Procedures for Indemnification.  In case any action, proceeding or claim is brought against an indemnified party in respect of which indemnification is sought hereunder, Licensor shall be entitled to participate and, unless in the reasonable judgment of legal counsel to the indemnified party a conflict of interest between it and Licensor may exist with respect of such action, proceeding or claim, to assume the defense thereof with counsel reasonably satisfactory to the indemnified party.  In the event that Licensor fails, within thirty (30) days of receipt of any indemnification notice, to notify, in writing, such person of Licensor’s election to defend, settle or compromise, at its sole cost and expense, any action, proceeding or claim (or discontinues its defense at any time after it commences such defense), then the indemnified party may, at its option, defend, settle or otherwise compromise or pay such action or claim.  In any event, unless and until Licensor elects in writing to assume and does so assume the defense of any such claims, proceeding or action, the indemnified party’s costs and expenses arising out of the defense, settlement or compromise of any such action, claim or proceeding shall be losses subject to indemnification hereunder.  The indemnified party shall cooperate fully with Licensor in connection with any negotiation or defense of any such action, claim or proceeding by Licensor and shall furnish to Licensor all information reasonably available to the indemnified party which relates to such action, claim or proceeding.  Licensor shall keep the indemnified party fully apprised at all times as to the status of the defense or any settlement negotiations with respect thereto.  If Licensor elects to defend any such action or claim, then the indemnified party shall be entitled to participate in such defense using counsel of its choice at its sole cost and expense.  Licensor shall not be liable for any settlement of any action, claim or proceeding effected without its prior written consent.  Notwithstanding anything in this Section 7 to the contrary, Licensor shall not, without the indemnified party’s prior written consent, settle or compromise any claim or consent to entry of any judgment in respect thereof which imposes any future obligation on the indemnified party or which does not include, as an unconditional term thereof, the giving by the claimant or the plaintiff to the indemnified party of a release from all liability in respect of such claim.

 

  

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7.4           Indemnification Payments.  The indemnification required by this Section 7 shall be made by periodic payments of the amount thereof during the course of investigation or defense, as and when bills are received or expenses, loss, damage or liability is incurred, so long as the indemnified party irrevocably agrees to refund such moneys if it is ultimately determined by a court of competent jurisdiction that such party was not entitled to indemnification.  The indemnity agreements contained herein shall be in addition to (i) any cause of action or similar rights of the indemnified party against Licensor or others, and (ii) any liabilities Licensor may be subject to pursuant to the law.

ARTICLE 8

MISCELLANEOUS

8.1           Notices.  All notices from one Party to the other required or permitted under this Agreement shall be in writing, shall refer specifically to this Agreement, and shall be delivered in person, or sent by electronic or facsimile transmission for which a confirmation of delivery is obtained, or sent by registered mail or express courier services providing evidence of delivery, in each case to the recipient Party’s respective address set forth on the signature page hereof (or to such updated address as may be specified in writing to the other Party from time to time).  Such notices will be deemed effective as of the date so delivered.

8.2           Assignment.  Licensor shall not assign, transfer, subcontract or otherwise delegate any of its obligations under this Agreement without Licensee’s prior written consent in each instance other than as a part of any merger, consolidation, or other statutory business combination or as a part of the sale of all or substantially all of its assets.  Any attempted assignment, transfer, subcontracting or other delegation without such consent shall be void and shall constitute a breach of this Agreement.  Subject to the foregoing, this Agreement shall inure to the benefit of the Parties’ successors and assigns.

8.3           Injunctive Relief.  The parties each acknowledge that any breach of this Agreement by it may cause irreparable harm to the other parties or their respective affiliates and that the remedies for breach may include injunctive relief against such breach, in addition to damages and other available remedies.

8.4           Entire Agreement.  This Agreement, including the MTA and the Transaction Documents referenced herein, constitutes the entire agreement between the Parties relating to the subject matter hereof and supersedes and cancels all other prior agreements and understandings of the Parties in connection with subject matter.  The headings or titles in this Agreement are for purposes of reference only and shall not in any way affect the interpretation or construction of this Agreement.

8.5           Waiver and Amendment.  No waiver of any of the provisions of this Agreement shall be valid unless in a written document, signed by the Party against whom such a waiver is sought to be enforced, nor shall failure to enforce any right hereunder constitute a continuing waiver of the same or a waiver of any other right hereunder.  All amendments of this Agreement shall be made in writing and signed by the Parties, and no oral amendments shall be binding on the Parties.

8.6           Governing Law and Arbitration  This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado, other than such laws, rules, regulations and case law that would result in the application of the laws of a jurisdiction other than the State of Colorado.  In the event of a dispute between the Parties concerning the subject matter of this Agreement, the Parties shall resolve the dispute using the procedures and binding arbitration specified in Section 7 (g) of the MTA.

8.7           Severability.  If any provision of this Agreement, or the application thereof, shall for any reason and to any extent be invalid or unenforceable, the remainder of this Agreement and application of such provision to other persons or circumstances shall be interpreted so as best to reasonably effect the intent of the Parties hereto.  The Parties further agree to replace such void or unenforceable provision with a provision which will achieve, to the extent possible, the economic, business and other purposes of the void or unenforceable provision.

 

  

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8.8           Interpretation.  The Parties have each been represented by counsel in the negotiation of this Agreement and have jointly prepared this Agreement with counsels’ assistance.  In the event of an ambiguity or a question of contract interpretation arises, no provision of this Agreement shall be construed based on any particular Party having drafted the Agreement or such provision.  Further, neither the history of negotiations between the Parties, nor the fact that provisions of this Agreement (or portions thereof) have been inserted, deleted or modified in the course of preparing Agreement drafts, shall be used to construe the meaning of any provision.

8.9           Further Assurances.  Each Party agrees to cooperate fully with the other and to execute such further instruments, documents and agreements and to give such further written assurances, as may be reasonably requested by another Party to better evidence and reflect the transactions described herein and contemplated hereby, and to carry into effect the intents and purposes of this Agreement.

8.10         Independent Contractors.  Nothing contained in this Agreement shall be deemed or construed as creating a joint venture or partnership between the Parties.  No Party shall have the power to control the activities and operations of another, and their status is, and at all times will continue to be, that of independent contractors with respect to each other.  No Party shall hold itself out as having any authority or relationship in contravention of this Section, and except as specifically called for or permitted herein, no Party shall act on behalf of another Party or enter into any contracts, warranty, or representation as to any other matter on the behalf of another Party.

IN WITNESS WHEREOF, each of the Parties has executed this Agreement as of the date first written above. Each of Parties affirms that the person signing this Agreement on such Party’s behalf is duly authorized to do so and thereby to bind the indicated entity. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

 

	
Liquidmetal Technology, Inc.

	  	
Visser Precision Cast, LLC

	  	  	  
	  	  	  
	
/s/ Tom Steipp

	  	
/s/ Gregory A. Ruegsegger

	
Tom Steipp

	  	
By: Gregory A. Ruegsegger

	
Title: President/CEO

	  	
Title: Vice President

	  	  	  
	
Date:  June 1, 2012

	  	
Dated:  June 1, 2012

	  	  	  
	
Address:

	  	
Address:

	
30452 Esperanza

	  	
6275 E. 39th Street

	
Rancho Santa Margarita, CA 92688

	  	
Denver, CO 8020

  

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ATTACHMENT A

TO

VPC SUBLICENSE AGREEMENT

List of LMT Technology Licensees

	
1. 

	
Exclusive License Agreement between LMT and Crucible, dated August 5, 2010.

	
2. 

	
Exclusive License Agreement between Crucible and Apple, Inc., dated August 5, 2010.

	
3.

	
First Amended and Restated License Agreement between LMT and LLPG, Inc., dated December 31, 2006, as amended March 30, 2009, July 24, 2010 and March 4, 2011.

	
4.

	
License Agreement between LMT and The Swatch Group Ltd., dated March 23, 2009, as amended March 7, 2010.

	
5.

	
License Agreement between LMT and Innovative Materials Group, LLC, dated August 5, 2011.

	
6.

	
License Agreement between LMT and Liquidmetal Golf, dated January 1, 2002.

	
7.

	
Amended and Restated License Agreement between LMT and the California Institute of Technology, dated September 1, 2001.

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