EX-10.64 24 0024.txt LICENSE AGREEMENT DATED AUGUST 1, 2000 EXHIBIT 10.64 LICENSE AGREEMENT THIS LICENSE AGREEMENT ("Agreement"), entered into and effective as of the 1st day of August 2000, by and between Charles Brister, an individual, ("Licensor") and Karts International Incorporated, a Nevada corporation ("Licensee"): WITNESSETH THAT: WHEREAS Charles Brister is the Owner of the "Technology" as defined below, and WHEREAS Licensee desires to obtain from the Licensor a license under said Technology; WHEREAS both parties acknowledge the expiration of that certain license agreement dated the 15th day of March, 1996 as amended by Addendum "A" to License Agreement dated the 15th of March, 1997 between Licensor and Licensee; WHEREAS both parties acknowledge that there is earned, yet unpaid royalties of forty thousand dollars ($40,000.00 U.S.) due to Licensor under the above referenced license agreement which will be paid in full at the time of signing of this agreement. WHEREAS both parties represent that they are able to comply with and otherwise satisfy the terms and conditions set forth in this Agreement; NOW THEREFORE, in consideration of the sum of ten dollars ($10 U.S.) and other good and valuable consideration now paid by each of the parties hereto to the other, the receipt of all of which hereby irrevocably acknowledged by each party, it is agreed as follows: SECTION 1 DEFINITIONS 1.1 "Patent Rights" shall mean collectively: (a) United States Patent Number 5,477,940, issued December 26, 1995, for "Accelerator Pedal Override Apparatus for Self-Propelled Motorized Cart with Aligned Brake and Accelerator Pushrod Type Operator Pedals" ("Pedal Override"), and (b) United States Patent Number 5,328,011 issued July 12, 1994, for "Clutch Assembly for Chain-Driven Cart ("Clutch Lube"), and (c) applications for patents that have been filed or may be filed in the future for improvements relating to the above two named patents, the inventions described and claimed therein, and any divisions, continuations, continuations-in-part, patents issuing thereon or reissues thereof; and any and all foreign patents and patent applications corresponding thereto; which will be automatically incorporated in and added to this Agreement and shall periodically be added to Appendix A attached to this Agreement and made a part thereof. 1.2 "Licensed Processes" shall mean the processes claimed in Patent Rights or processes utilizing Proprietary Materials or some option thereof. License Agreement - Page 1 1.3 "Licensed Products" shall mean products claimed in Patent Rights or products made in accordance with or by means of Licensed Processes or products made utilizing Proprietary Materials or incorporating some portion of Proprietary Materials. 1.4 "Proprietary Materials shall mean the materials supplied by Licensor together with any of the know-how and all related rights, trade secrets, and Technology, owned by Licensor and relating to a family of go-kart products and go-kart components as they presently exist and as they may be acquired, developed or modified in the future. 1.5 "Technology" shall mean any and all confidential information, Proprietary Materials, or Patent Rights supplied by Licensor to Licensee. The confidential information shall not include information which: (a) is known to Licensee on a non-confidential basis prior to disclosure by Licensor; or (b) is part of the public domain and known to the general public at the time it was disclosed to Licensee. 1.6 "Territory" shall mean the entire United States of America, its territories and possessions, and foreign countries in which Patent Rights exist. SECTION 2 GRANT OF LICENSE 2.1 Scope of License. Subject to the terms and conditions of this Agreement, Licensor hereby grants to Licensee a License (the "License"): 2.1.1 to use the information or secrets disclosed in the Technology to develop Karts International Incorporated, its affiliates, or its wholly-owned subsidiaries' Licensed Products, hereinafter collectively referred to as KII Licensed Products; 2.1.2 to incorporate the information or secrets disclosed in the Technology in KII Licensed Products; 2.1.3 to manufacture or have manufactured KII Licensed Products containing the information or secrets disclosed in the Technology; 2.1.4 to sell or have sold KII Licensed Products containing the information or secrets disclosed in the Technology. 2.2 Non-Exclusive License. The License is a non-exclusive License in the Territory for the Technology for KII Licensed Products. 2.3 License Term. The term of this License shall be for a period of three years commencing on the Effective Date. License Agreement - Page 2 2.4 Royalty. With regard to the licensing of the Technology as set forth in Section 2 hereof, Licensee hereby agrees to pay to Licensor royalties as follows: (i) the greater of $20,000 or the sum of a royalty of $1.00 for each of the Licensed Products sold by Licensee or any of its affiliates or subsidiaries containing or utilizing the Pedal Override during the period beginning August 1, 2000 and ending July 31, 2001, and a royalty of $0.50 for each of the Licensed Products sold by Licensee or any of its affiliates or subsidiaries containing or utilizing the Clutch Lube during the period beginning August 1, 2000 and ending July 31, 2001, (ii) the greater of $20,000 or the sum of a royalty of $1.00 for each of the Licensed Products sold by Licensee or any of its affiliates or subsidiaries containing or utilizing the Pedal Override during the period beginning August 1, 2001 and ending July 31, 2002, and a royalty of $0.50 for each of the Licensed Products sold by Licensee or any of its affiliates or subsidiaries containing or utilizing the Clutch Lube during the period beginning August 1, 2001 and ending July 31, 2002, and (iii) the greater of $20,000 or the sum of a royalty of $1.00 for each of the Licensed Products sold by Licensee or any of its affiliates or subsidiaries containing or utilizing the Pedal Override during the period beginning August 1, 2002 and ending July 31, 2003, and a royalty of $0.50 for each of the Licensed Products sold by Licensee or any of its affiliates or subsidiaries containing or utilizing the Clutch Lube during the period beginning August 1, 2002 and ending July 31, 2003. Licensee shall remit payment of accrued royalties on January 31 and July 31 of each year during the term of this Agreement. 2.5 Implementation. Licensor and Licensee agree that Licensee (i) will implement or integrate the information or secrets contained in the Technology into the KII products and (ii) shall be the exclusive owner of such KII products. 2.6 Sublicensing. Licensee shall have, with the written consent by the Licensor, the right to sublicense developers of KII products to use the information or secrets contained in the Technology for the sole purpose of developing KII products to be owned by KII or any of its affiliates or subsidiaries. The Licensee is not empowered by this clause to veto subsequent licenses. 2.7 Rights Retained. All rights not specifically assigned to Licensee are retained by Licensor. SECTION 3 TITLE 3.1 Title to the Licensed Technology. Licensor represents and warrants that it is the sole owner of all right, title and interest in and to the Technology, except as otherwise provided in Appendix A, attached hereto. SECTION 4 LIMITATIONS OF LIABILITY 4.1 Disclaimer. Except as specifically set forth herein, Licensor makes no warranties, expressed or implied, regarding or relating to the Technology or to any other materials or services furnished or provided to the Licensee hereunder. 4.2 Limitation of Liability. In no event shall the Licensor or any person or entity involved in creating the Technology be liable under any claim, demand or action arising out of or relating to performance or lack thereof under this Agreement for any special, indirect, incidental, exemplary or consequential damages, whether or not Licensor or such person has been advised of the possibility or such claim, demand or action. License Agreement - Page 3 4.3 Licensor represents and warrants that it has sufficient right, title and interest in and to the Technology to enter into this Agreement, and further warrants that the Technology does not, to the best of Licensor's knowledge, infringe any patent, copyright or other proprietary right of a third party when used as contemplated by this Agreement and that Licensor has not been notified of a possibility that the Technology might infringe any patent, copyright or other proprietary rights of a third party. SECTION 5 TERMINATION 5.1 Termination by Either Party. Either party may terminate this Agreement upon 30 (thirty) days written notice to the other party if the other party commits a material breach of any term hereof and fails to cure said breach within the 30 (thirty) day period. Such notice shall set forth the basis of termination. A material breach is considered to be, but not limited to, the following: (1) default of performance; (2) failure to meet payments; (3) failure to provide reports and access to records; or (4) unauthorized disclosures. 5.2 Automatic Termination. If Licensee shall be adjudicated insolvent, is the subject of an involuntary petition in bankruptcy not dismissed within the 60 days of the filing of said involuntary petition, or files a petition in bankruptcy, or for reorganization, or if Licensee shall take advantage of any insolvency act, or make an assignment for the benefit of creditors, then, and in any such event, this Agreement shall forthwith terminate and the license herein granted shall not constitute an asset in reorganization, bankruptcy or insolvency which may be assigned or which may accrue to any court or creditor appointed referee, receiver or committee. 5.3 Actions upon Termination. Upon termination of this Agreement for any reason, Licensee shall immediately cease use of, and forthwith return to Licensor the Technology and tangible manifestations or copies thereof and all licenses theretofore granted by Licensee under this Agreement will be transferred and assigned by Licensee to Licensor or to that person, firm, or corporation Licensor designates for that purpose. SECTION 6 MISCELLANEOUS 6.1 Assignment. Except as provided herein, Licensee shall not sell, transfer, assign or subcontract any right or obligation hereunder without prior written consent of the Licensor, provided however, Licensee may upon ten (10) days written notice to, but without prior consent of the Licensor assign this Agreement pursuant to: 6.1.1 the merger or consolidation of the Licensee; or License Agreement - Page 4 6.1.2 the sale of substantially of all the assets of the Licensee to a third party, provided the party remains fully liable for its obligation hereunder and such third party agrees to be liable for the party's obligations hereunder. 6.2 Successors and Assigns. The covenants and conditions herein contained shall, subject to the provisions as to assignment, apply to and bind the successors and permitted assigns of the parties hereto. 6.3 Dispute Resolution. The parties will conduct friendly negotiations to resolve any dispute. Failing resolution, disputes will be finally resolved by arbitration in Las Vegas, Nevada, pursuant to the Commercial rules of the American Arbitration Association, by one arbitrator appointed in accordance with such rules. The parties agree that any arbitral award and any matter requiring injunctive or other provisional relief may be instituted and enforced in any court having jurisdiction. In the event of any dispute between the parties relating to this Agreement, the party substantially prevailing will be entitled to recover all cost and expenses of any subsequent proceedings (including trial, arbitration and appellate proceedings), including the attorney fees incurred therein. 6.4 Choice of Law. The interpretation and construction of this Agreement shall be governed by the laws of the State of Nevada. 6.5 Severability. If any provision of this Agreement is held by a court of competent jurisdiction to be contrary to law, the remaining provisions of this Agreement will remain in full force and effect. 6.6 Notice. Any notice required or permitted to be made or given by either party under this Agreement shall be deemed to have been duly given if delivered, postage prepaid, certified mail, return receipt requested: If Licensor to: Charles Brister 505 Ellis Road Amite, Louisiana 70422 If Licensee to: Karts International Incorporated Post Office Box 695 Roseland, Louisiana 70456 and/or to any such person(s) address(es) as either party shall have specified in writing to the other. 6.7 Marking of Products. Licensee shall accordingly affix or cause to be affixed proper statutory patent, trademark and/or copyright notices to each apparatus made by Licensee under this Agreement. 6.8 Entire Agreement. The provisions herein together with the Appendix attached hereto, constitute the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements, oral or written, and all other communications relating to the subject matter hereof. No amendment or modification of any provision of this Agreement will be effective unless set forth in a document that purports to amend this Agreement and that is executed by both parties hereto. License Agreement - Page 5 6.9 Counterparts. This Agreement may be executed in two or more counterparts, each of which will be an original and will be effective as of the date set forth on the first page when signed on behalf of Licensor and Licensee. IN WITNESS WHEREOF, the parties have caused this Agreement to be effective as of the date first set forth above: Charles Brister Karts International Incorporated By: By: ----------------------- ------------------------------ Title: Corporate Secretary ---------------------------- Seal: