Exhibit 10.2
CONFIDENTIALITY AND NON-COMPETITION AGREEMENT
This CONFIDENTIALITY AND NON-COMPETITION AGREEMENT (this "AGREEMENT") is
dated as of December 5, 2001, by and among Zengen, Inc., a California
corporation ("ZENGEN"), Zensano, Inc., a California corporation ("Zensano"),
Robert Davidson, Matthew Lipton, Henry (Hank) Landau, Larry Kaye, Charles
Hensley and Michelle Rossow, each a business person, Gum Tech International,
Inc., a Utah corporation ("GUM TECH") and Gel Tech, L.L.C., an Arizona limited
liability company ("GEL TECH").
BACKGROUND
Effective as of the date of this Agreement, Zensano has sold and
transferred to Gum Tech, and Gum Tech has purchased and acquired from Zensano,
Zensano's forty percent (40%) ownership interest in Gel Tech pursuant to that
certain Purchase Agreement dated as of December 5, 2001 by and among Zengen,
Zensano and Gum Tech (the "PURCHASE AGREEMENT") such that Gum Tech has become
the sole legal and beneficial owner of Gel Tech.
Robert Davidson, Matthew Lipton, Henry (Hank) Landau, Larry Kaye and
Charles Hensley are shareholders of Zengen and have benefited indirectly from
the transactions contemplated by the Purchase Agreement;
Robert Davidson, Matthew Lipton, Henry (Hank) Landau, Larry Kaye, Charles
Hensley and Michelle Rossow are material managers, employees and/or consultants
of Gel Tech who possess or have had access to confidential and material
information regarding the affairs of Gel Tech, which information Gum Tech and
Gel Tech wish to protect.
Pursuant to the terms of that certain Intellectual Property Development and
License Agreement dated effective May 21, 1999, (the "IP DEVELOPMENT AND LICENSE
AGREEMENT") among Gum Tech, Gel Tech and Bio-Delivery Technologies, Inc., a
California corporation ("BDT") of which Zensano is the lawful successor, a copy
of which is attached hereto as EXHIBIT A, among other things, (i) Gel Tech and
Gum Tech granted to BDT certain licensing rights with respect to certain nasal
and non-nasal gel technologies, and (ii) Gum Tech, Gel Tech and BDT each made
certain covenants and undertook certain obligations with respect to the
preservation of confidential information and non-competition.
As a condition of the completion by Gum Tech and Zensano of the
transactions contemplated by the Purchase Agreement, the Parties wish to enter
into this Agreement to set forth the obligations of the Parties with respect to
the preservation of confidential information, non-competition and the assignment
of Intellectual Property, and to amend certain provisions of the IP Development
and License Agreement.
NOW, THEREFORE THIS AGREEMENT WITNESSES, that in consideration for entering
into the Purchase Agreement, the payment by Gum Tech of the Purchase Price (as
that term is defined in the Purchase Agreement), the payment by Gum Tech of Five
Hundred Dollars ($500.00) to each of Robert Davidson, Matthew Lipton, Henry
(Hank) Landau, Larry Kaye, Charles Hensley and Michelle Rossow, and the mutual
covenants set forth herein, the receipt and sufficiency of which consideration
is hereby acknowledged, the Parties agree as follows:
ARTICLE 1
INTERPRETATION
1.1 DEFINITIONS. As used in this Agreement, except as otherwise expressly
set forth herein or unless the context otherwise requires, the following terms
have the meanings set forth below:
"783 PATENT" has the meaning set forth in the IP Development and License
Agreement.
"AFFILIATE" means, with respect to any specified Person, any other Person
that directly, or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with, such specified Person.
"BUSINESS" means the business conducted by Gel Tech of researching,
developing, producing, manufacturing, marketing and selling, or causing the
research, development, production, manufacture, marketing and sale, of
innovative non-prescription nasal gel technologies, delivery systems for
bioactive compounds and homeopathic products, including, without limitation,
Zicam(TM) Cold Remedy, Zicam(TM) Allergy Relief and related products, all as
detailed in the IP Development and License Agreement.
"BUSINESS DAY" means any day that is not a Saturday, Sunday or other day on
which banks are required or authorized by law to be closed in Phoenix, Arizona
or Woodland Hills, California.
"COLD REMEDY GEL TECHNOLOGY" has the meaning set forth in the IP
Development and License Agreement.
"CONFIDENTIAL INFORMATION" has the meaning set forth in SECTION 2.1.
"GEL TECHNOLOGY" has the meaning set forth in the IP Development and
License Agreement.
"GOVERNMENTAL AUTHORITY" means any federal, state, regional, district or
local government (domestic or foreign) and each department, commission, board,
bureau, or other agency or political subdivision thereof, any Person exercising
executive, legislative, regulatory or administrative functions of, or pertaining
to, any such government and any court, tribunal, judicial, quasi-judicial or
arbitration body.
"GOVERNMENTAL ORDER" means any order, writ, judgment, injunction, decree,
stipulation, determination or award entered by or with any Governmental
Authority.
"INTELLECTUAL PROPERTY" means, collectively, any and all United States and
foreign patents and patent applications, including, without limitation, the `783
Patent, (including any and all reissues, divisionals, continuations, renewals,
extensions and continuations-in-part thereof or other rights and applications
based thereon, and any and all improvements and applications for patents based
on, growing out of or relating to the inventions described therein), trade
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names, trademarks, service marks and registrations thereof and applications
therefor, copyrights and copyright registrations and applications therefor,
discoveries, inventions, ideas, concepts, technology, know-how, trade secrets,
mask works, methods, techniques, systems, processes, formulas, drawings,
designs, Software and internet web sites and domain names.
"IP DEVELOPMENT AND LICENSE AGREEMENT" has the meaning set forth in the
"Background" section of this Agreement.
"LAW" means any federal, state, local, municipal or international statute,
law, ordinance, regulation, rule, code, order, or other requirement or rule of
law, including common law.
"NICOTINE GEL TECHNOLOGY" has the meaning set forth in the IP Development
and License Agreement.
"NON-PRESCRIPTIVE NASAL GEL TECHNOLOGY" has the meaning set forth in the IP
Development and License Agreement.
"NON-PRESCRIPTIVE NON-NASAL GEL TECHNOLOGY" has the meaning set forth in
the IP Development and License Agreement.
"OTHER PRESCRIPTIVE GEL TECHNOLOGY" has the meaning set forth in the IP
Development and License Agreement.
"PARTY" means each Party to this Agreement, and "PARTIES" means two or more
of such Parties, as the context of such reference requires.
"PERSON" means any individual, partnership, firm, corporation, limited
liability company, association, trust, unincorporated organization or other
entity, Governmental Authority, any syndicate or group that would be deemed to
be a person under Section 13(d)(3) of the Exchange Act and any trustee,
executor, administrator or other legal representative of any of the foregoing.
"PROTECTED TERRITORY" means, with respect to the Parties' respective
covenants and obligations under SECTION 4.2 and SECTION 4.3, the United States
of America, Canada, Mexico, Europe, Asia and Australia, except as such territory
is otherwise reduced pursuant to SECTION 4.6 or by written agreement of the
Parties.
"PURCHASE AGREEMENT" has the meaning set forth in the "Background" section
of this Agreement.
"SOFTWARE" means computer software (present and subsequent versions
thereof), including source code, object, executable or binary code, objects,
comments, screens, user interfaces, report formats, templates, menus, buttons
and icons and all files, data, materials, manuals, design notes and other items
and documentation related thereto or associated therewith.
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"TERM" means, with respect to the Parties' respective covenants and
obligations under ARTICLE 4, a term of five (5) years commencing on the date of
this Agreement, except as such term is otherwise reduced pursuant to SECTION 4.6
or by written agreement of the Parties.
"ZENGEN GROUP" means, collectively, Zengen, Zensano, Robert Davidson,
Matthew Lipton, Henry (Hank) Landau, Larry Kaye, Charles Hensley and Michelle
Rossow.
1.2 INTERPRETATION AND USAGE. In this Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the term "this Agreement" means this Confidentiality and
Non-Competition Agreement, including all Exhibits hereto, as any or all of
which may be amended or supplemented from time to time by the mutual
agreement of the Parties or otherwise pursuant to the terms hereof;
(b) the terms "hereof," "herein," "hereunder" and comparable terms
refer, unless otherwise expressly indicated, to this Agreement as a whole
and not to any particular Article, Section or other subdivision hereof or
attachment hereto;
(c) a reference to any "Article", "Section" or another subdivision
hereof or to any Schedule, Exhibit or other attachment hereto is a
reference to an Article, Section or other subdivision of, or to a Schedule,
Exhibit or other attachment to, this Agreement;
(d) the headings of Articles, Sections, Schedules and Exhibits and the
Table of Contents are inserted for convenience of reference only and will
have no bearing on the interpretation of the provisions of this Agreement;
(e) the terms "include," "includes" and "including" will be deemed to
be followed by "without limitation" whether or not they are in fact
followed by such words or words of like import;
(f) any agreement, document or instrument defined or to which
reference is made means such agreement or instrument as from time to time
amended, modified or supplemented, including by waiver or consent;
(g) a reference to any Law includes all regulations and rules
thereunder, all amendments thereto in force from time to time (including
amendments to section or subsection references) and every Law in effect
that supplements, replaces or supercedes such Law; and
(h) any term defined by way of reference to any agreement, document,
instrument or Law has such meaning whether or not such agreement, document,
instrument or Law is in effect.
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ARTICLE 2
CONFIDENTIALITY
2.1 ACKNOWLEDGEMENT OF ZENGEN GROUP. Each member of the Zengen Group
acknowledges and agrees that through its ownership (direct or indirect) and/or
participation in the operation of Gel Tech, such member has occupied a position
of trust and confidence with respect to Gel Tech up to the date hereof and has
had access to and has become familiar with some or all of the following, any and
all of which constitute confidential and proprietary information of Gel Tech
(collectively the "CONFIDENTIAL INFORMATION"):
(a) any and all Intellectual Property owned or used by Gel Tech in the
conduct of the Business, including, without limitation, (i) past, current
and planned research and development, and (ii) product designs,
improvements, innovations and developments (whether pending or
prospective);
(b) customer lists, current and anticipated customer requirements,
price lists, market studies and business plans used, developed or created
by or on behalf of Gel Tech;
(c) historical and projected sales, financial projections, capital
spending and operating budgets and plans used, developed or created by or
on behalf of Gel Tech;
(d) identities and requirements of key suppliers and potential
suppliers used, developed or created by or on behalf of Gel Tech;
(e) personnel training techniques and materials used, developed or
created by or on behalf of Gel Tech; and
(f) any and all other confidential or proprietary information
concerning the Business and the affairs of Gel Tech, however documented,
and whether prepared by or on behalf of Gel Tech, any member of the Zengen
Group or any Affiliate thereof.
2.2 TREATMENT OF CONFIDENTIAL INFORMATION. The members of the Zengen Group
acknowledge and agree that the protection of the Confidential Information is
necessary to protect and preserve the value of the Business, and that without
such protection, Gum Tech would not have entered into or consummated the
transactions contemplated by the Purchase Agreement. Accordingly, subject to
SECTION 2.3, each member of the Zengen Group hereby covenants and agrees that
such member will not, nor will he, she or it cause any Affiliate or any of its
or such Affiliate's respective directors, officers, managers, employees,
consultants, agents or representatives to, at any time after the date hereof,
disclose to any Person or use for his, her or its own account or for the benefit
of any Person any Confidential Information, whether or not such information is
embodied in writing or other physical form or is retained in the memory of any
director, officer, manager, employee, consultant, agent or representative of any
Zengen Group member or of any Affiliate thereof, without Gum Tech's and Gel
Tech's written consent (which consent will be at Gum Tech's and Gel Tech's
absolute discretion)
2.3 EXCEPTIONS TO CONFIDENTIALITY OBLIGATIONS. The provisions of SECTION
2.2 will not apply to any Confidential Information (i) that a member of the
Zengen Group can clearly and convincingly demonstrate is generally known to, and
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available for use by, the public other than as a result of the breach of this
Agreement or any other agreement pursuant to which any Person (including any
member of the Zengen Group) owes any duty of confidentiality to Gum Tech or Gel
Tech, (ii) that is required to be disclosed pursuant to applicable Law or a
final Governmental Order, or (iii) that Zengen or Zensano reasonably determines
is necessary to be disclosed in order for such Party to enforce its rights
against Gum Tech or Gel Tech, as the case may be, under the Purchase Agreement
or this Agreement (and then only to the extent necessary to enforce such
rights). If any member of the Zengen Group or any Affiliate thereof, or any
director, officer, manager, employee, consultant, agent or representative
thereof, becomes compelled by applicable Law or a final Governmental Order to
disclose any Confidential Information, such member will provide Gum Tech and Gel
Tech with prompt written notice of such requirement so that Gum Tech and/or Gel
Tech may seek a protective order or other remedy in respect of such compelled
disclosure. If such a protective order or other remedy is not obtained by or is
not available to Gum Tech or Gel Tech, the applicable Zengen Group member(s)
will ensure that only the minimum portion of such Confidential Information that
is legally required to be disclosed is so disclosed and will use all reasonable
efforts to obtain assurances that confidential treatment will be given to such
Confidential Information.
ARTICLE 3
ASSIGNMENT OF INTELLECTUAL PROPERTY RIGHTS
3.1 ASSIGNMENT OF INTELLECTUAL PROPERTY RIGHTS. Each of Robert Davidson,
Matthew Lipton, Henry (Hank) Landau, Larry Kaye, Charles Hensley and Michelle
Rossow hereby irrevocably waives any and all right (including moral rights),
title and interest in and to any and all Intellectual Property conceptualized,
created, invented, developed, modified, improved or used by or in the Business
of Gel Tech or otherwise owned by Gel Tech, including, without limitation, any
such Intellectual Property conceptualized, created, invented, developed,
modified or improved by any such individual (i) in connection with the scope of
such individual's employment or office with, or provision of consulting or other
services to, Gel Tech, (ii) through the full or partial use of any Gel Tech
resources (including, without limitation, office or other facilities, staff,
consultants, computer equipment or other manufacturing or design equipment), or
(iii) during such individual's working hours with Gel Tech, and each such
individual hereby assigns, conveys and transfers, and agrees to assign, convey
and transfer, unto Gel Tech all legal and beneficial right (including moral
rights), title and interest in and to such Intellectual Property, and hereby
further agrees to execute any and all such other documents deemed necessary or
appropriate by Gel Tech from time to time after the date hereof, and prepared by
Gel Tech, to further evidence and give effect to such individual's waiver,
assignment, conveyance and transfer hereunder; provided, however, that this
SECTION 3.1 does not apply to any Intellectual Property that is Non-Prescriptive
Non-Nasal Gel Technology or Other Prescriptive Gel Technology.
3.2 COOPERATION IN APPLICABLE PATENT PROCEEDINGS. Each of Robert Davidson,
Charles Hensley and Larry Kaye covenants and agrees that he will, and Zensano
covenants and agrees that it will cause each such individual to, during the life
of the `783 Patent or any other United States or foreign patent or patent
application based on or relating to the `783 Patent (any of the `783 Patent or
such other patent or patent application being an "APPLICABLE PATENT"), and for
as such individual is or should be named as an inventor or interest holder on
any Applicable Patent, cooperate reasonably with Gel Tech and Gum Tech, at
either such Party's request and at either such Party's sole cost:
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(a) in the prosecution and maintenance by Gum Tech or Gel Tech of any
Applicable Patent; and
(b) in any litigation (including pre-litigation proceedings) to which
Gel Tech or Gum Tech is a party or is otherwise involved in respect of or
in connection with, any Applicable Patent.
ARTICLE 4
NON-COMPETITION, NON-SOLICITATION
4.1 AMENDMENT TO IP DEVELOPMENT AND LICENSE AGREEMENT. Section 3 of the IP
Development and License Agreement ("Non-Competition") is hereby terminated in
its entirety and is of no further force or effect.
4.2 COVENANT NOT TO COMPETE BY GUM TECH AND GEL TECH. During the Term,
unless expressly permitted in writing by Zengen and Zensano or their respective
successors and assigns (which permission will be at each such Persons' absolute
discretion), Gum Tech and Gel Tech covenant that they will not, nor will they
cause any Affiliate or any director, officer, manager, employee, consultant or
agent of Gum Tech, Gel Tech or any such Affiliate to, directly or indirectly,
whether or not through the use of any interposed entity, agent or consultant,
own (other than the ownership of less than one percent (1%) of the outstanding
common stock of any corporation (but without otherwise participating in the
activities of such corporation) if such common stock is listed on any national
or regional securities exchange or automated dealer quotation system or has been
registered under Section 12(g) of the Securities Exchange Act of 1934, as
amended), invest in, finance, manage, control, operate, conduct, support,
provide services, advice or other support to, participate in, enter into any
partnership or joint venture with, engage in or be employed by or in, any
business or activity involving the research, development, design, production,
manufacture, marketing or sale, anywhere in the Protected Territory, of:
(a) Non-Prescriptive Non-Nasal Gel Technology; or
(b) Other Prescriptive Gel Technology
4.3 COVENANT NOT TO COMPETE BY ZENGEN GROUP. During the Term, unless
expressly permitted in writing by Gum Tech and Gel Tech or their respective
successors and assigns (which permission will be at each such Persons' absolute
discretion), each member of the Zengen Group covenants that it will not, nor
will it cause any Person, including any Affiliate or any director, officer,
manager, employee, consultant or agent of such member or any such Affiliate to,
and Zengen will not permit any of Robert Davidson, Matthew Lipton, Henry (Hank)
Landau or Larry Kaye to, directly or indirectly, whether or not through the use
of any interposed entity, agent or consultant, own (other than the ownership of
less than one percent (1%) of the outstanding common stock of any corporation
(but without otherwise participating in the activities of such corporation) if
such common stock is listed on any national or regional securities exchange or
automated dealer quotation system or has been registered under Section 12(g) of
the Securities Exchange Act of 1934, as amended), invest in, finance, manage,
control, operate, conduct, support, provide services, advice or other support
to, participate in, enter into any partnership or joint venture with, engage in
or be employed by or in, any business or activity involving the research,
development, design, production, manufacture, marketing or sale, anywhere in the
Protected Territory, of:
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(a) Cold Remedy Gel Technology;
(b) Non-Prescriptive Nasal Gel Technology; or
(c) Nicotine Gel Technology.
4.4 NO SOLICITATION OF CUSTOMERS. Each member of the Zengen Group covenants
and agrees that during the Term, unless otherwise expressly permitted in writing
by Gum Tech and Gel Tech (which permission will be at such Parties' exclusive
discretion), such member will not, nor will he, she or it cause any Affiliate or
any director, officer, manager, employee, consultant or agent of such member or
any such Affiliate to, and Zengen will not permit any of Robert Davidson,
Matthew Lipton or Henry (Hank) Landau to, directly or indirectly, (i) call on or
solicit for purposes of diverting or taking away from Gum Tech, Gel Tech or any
Affiliate thereof any Person that is or has been within the two (2) years
immediately preceding the date hereof a customer of Gel Tech or the Business or
whose identity is known to any member of the Zengen Group as of the date hereof
as one which Gum Tech, Gel Tech or any Affiliate thereof intends to solicit or
has contemplated soliciting for the sale of products or services of the
Business, or (ii) induce or attempt to induce any customer, supplier, licensee
or other Person to cease conducting business with Gum Tech, Gel Tech or any
Affiliate thereof or in any way interfere with the relationship between any such
customer, supplier, licensee or other business entity and Gum Tech, Gel Tech or
any Affiliate thereof.
4.5 NO SOLICITATION OF GEL TECH EMPLOYEES. With respect to each employee of
Gel Tech, each member of the Zengen Group covenants and agrees that until the
earlier of (i) the prior termination by Gel Tech of the employment of such
employee, and (ii) December 31, 2002, such member will not, nor will it cause
any Affiliate or any director, officer, manager, employee, consultant or agent
of such member or any such Affiliate to, directly or indirectly:
(a) induce or attempt to induce any such employee of Gel Tech to leave
the employ of Gel Tech;
(b) interfere with the relationship between Gum Tech or Gel Tech and
any such employee; or
(c) employ or otherwise engage as an employee, consultant, independent
contractor or otherwise any such employee of Gel Tech (except and only to
the extent that such engagement was in effect as of September 30, 2001);
PROVIDED, however, that the provisions of this SECTION 4.5 will not apply to
general solicitations or advertisements for employment made to the general
public through newspapers, trade publications or radio or television broadcasts,
or to the hiring of any employee of Gel Tech who voluntarily and without
solicitation from any member of the Zengen Group or any Affiliate thereof (other
than a general solicitation to the public described herein) seeks employment
with a member of the Zengen Group or an Affiliate thereof.
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4.6 AMENDMENT OF PROVISIONS TO COMPLY WITH LAW. Each Party acknowledges and
agrees that the covenants and obligations made and undertaken by it in ARTICLE 2
and this ARTICLE 4, as applicable, are reasonable with respect to duration,
geographic area and scope of activity, and each Party covenants that it will
not, directly or indirectly, initiate or participate in any action or otherwise
do or cause to be done any act or thing to cause any such covenant or obligation
to be terminated, cancelled, voided, nullified, reduced in scope or effect or
otherwise declared unenforceable. If, however, any provision of this Agreement
is finally determined or declared by a court of competent jurisdiction to be
illegal, unenforceable, invalid, contrary to public policy, void or voidable
under any applicable Law, then the Parties will negotiate an equitable
adjustment to the provisions of this Agreement with the view to effecting, to
the greatest extent possible, the original purpose and intent of this Agreement,
including, without limitation, the maximum durational, geographic and other
limitations permitted by applicable Law. In particular, if required by a final
determination or declaration of a court of competent jurisdiction in order for
this Agreement to remain valid and enforceable against the Parties:
(a) the Protected Territory will be reduced to the United States,
Canada, Mexico, Europe and Asia, or if such reduction is not sufficient in
such court's determination, to the United States, Canada, Mexico and
Europe, or if such reduction is not sufficient in such court's
determination, to the United States, Canada and Mexico, or if such
reduction is not sufficient in such court's determination, to the United
States and Canada, or if such reduction is not sufficient in such court's
determination, to the United States alone; and
(b) the Term will be reduced to four (4) years from the date of this
Agreement, or if such reduction is not sufficient in such court's
determination, to three (3) years from the date of this Agreement, or if
such reduction is not sufficient in such court's determination, to two (2)
years from the date of this Agreement, or if such reduction is not
sufficient in such court's determination, to one (1) year from the date of
this Agreement.
In any event, the validity and enforceability of the remaining provisions of
this Agreement will not be affected by any amendment contemplated by or made
pursuant to this SECTION 4.6. Without limiting the foregoing, the covenants and
obligations contained in this Agreement will be construed as separate covenants
and obligations, covering their respective subject matters. Each breach of a
covenant or obligation set forth in this Agreement will give rise to a separate
and independent cause of action.
ARTICLE 5
AMENDMENTS TO IP DEVELOPMENT
AND LICENSE AGREEMENT
5.1 TERMINATION AND SURVIVAL OF NOTICE AND LICENSE OBLIGATIONS. Gum Tech,
Zengen and Zensano acknowledge and agree that the Operating Agreement of Gel
Tech dated May __, 1999, as amended (the "ORIGINAL OPERATING AGREEMENT") is
terminated as of the date hereof, and is superseded and replaced as of the date
hereof by a separate Operating Agreement evidencing Gum Tech as the sole member
of Gel Tech. In connection with the termination of the Original Operating
Agreement:
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(a) Paragraph 7.1 of the IP Development and License Agreement is
hereby deleted in is entirety and replaced with the following:
"7.1 This Agreement will commence on the Effective Date and continue
in full force and effect until the expiration or termination of the
Operating Agreement, unless earlier terminated in accordance with the
express provisions of this Agreement; PROVIDED, HOWEVER, that
Paragraphs 2.2.3, 2.3.4, 2.4.4, 2.5.3, 2.7, 4, 5, 6.1, 6.2 and 8.1
through 8.5, inclusive, and all rights and obligations thereunder,
will survive the expiration or any termination of this Agreement and
will continue in perpetuity, unless such provisions expire or
terminate by their terms."
(b) the applicable obligations of each of Gum Tech, Gel Tech and
Zensano (as the lawful successor of BDT) under Paragraphs 2.2.1, 2.2.2,
2.3.1, 2.3.2, 2.3.3, 2.4.1, 2.4.2, 2.4.3, 2.5.1, 2.5.2 and 2.6.1 of the IP
Development and License Agreement to promptly disclose to each other (as
applicable) certain Gel Technology that each such Party owns or acquires
will survive the termination of the Original Operating Agreement
indefinitely, to the extent applicable to any such Gel Technology that is
owned or acquired before the date hereof, but hereby cease to apply to any
Gel Technology acquired or developed (including the acquisition or
development of any improvement or modification to Gel Technology that is
owned or acquired before the date hereof) by such Party on or after the
date hereof; and
(c) the licenses granted by each of Gum Tech, Gel Tech and Zensano (as
the lawful successor of BDT) under Paragraphs 2.2.1, 2.2.2, 2.3.1, 2.3.2,
2.3.3, 2.4.1, 2.4.2, 2.4.3, 2.5.1, 2.5.2 and 2.6.1 of the IP Development
and License Agreement will survive the termination of the Original
Operating Agreement indefinitely as irrevocable, fully-paid, perpetual,
exclusive, world-wide licenses, but only to the extent applicable to Gel
Technology that was owned or acquired by such Party before the date hereof.
ARTICLE 6
GENERAL PROVISIONS
6.1 ENTIRE AGREEMENT. This Agreement and the IP Development and License
Agreement, as amended hereby, collectively constitute the entire, final and
complete agreement among the Parties with respect to the subject matter hereof
and supersede all prior agreements, representations, negotiations,
communications and understandings (other than Zengen's and Zensano's and Gum
Tech's respective representations, warranties and covenants set forth in the
Purchase Agreement, which are in no way affected or superseded by this Agreement
or the IP Development and License Agreement, as amended hereby), whether written
or oral, between or among any of the Parties with respect to the subject matter
hereof. With respect to the matters contemplated in this Agreement and the IP
Development and License Agreement, as amended hereby, no Party will be bound by
or liable for any statement, representation, promise, inducement, or
understanding of any kind whatsoever not expressly set forth in this Agreement,
the IP Development and License Agreement, as amended hereby, or the Purchase
Agreement.
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6.2 INJUNCTIVE RELIEF. The Parties acknowledge and agree that (i) the
provisions of ARTICLE 2, ARTICLE 3 and ARTICLE 4 are reasonable and necessary to
protect the legitimate business interests of Gum Tech, Gel Tech, Zengen and
Zensano, (ii) any violation of any covenant contained in any such Article will
result in irreparable injury to the Party(ies) affected by such violation, the
exact amount of which will be difficult to ascertain or estimate, and (iii) the
remedies at law for any such violation will not be reasonable or adequate
compensation for such Party(ies) for such a violation. Accordingly, the Parties
agree that if any Party violates any covenant given by it under ARTICLE 2,
ARTICLE 3 or ARTICLE 4, then, in addition to any other remedy which may be
available at law or in equity, the Party(ies) to which such covenant was given
will be entitled to specific performance and injunctive relief, without posting
bond or other security, and without the necessity of proving actual or
threatened damages.
6.3 FULL PERFORMANCE REQUIRED. The doctrine of substantial performance has
no application under or in respect of this Agreement. Each covenant and
obligation contained in this Agreement has been carefully considered and
represents the agreed minimum level of performance giving rise to applicable
rights and obligations hereunder.
6.4 NO WAIVER, DISCHARGE. The failure of any Party to enforce at any time
any provision of this Agreement will in no way be construed to be a waiver of
any such provision, nor in any way to affect the validity of this Agreement or
any part hereof or the right of such Party thereafter to enforce each and every
such provision. No waiver of any breach of this Agreement will be held to be a
waiver of any other or subsequent breach.
6.5 JOINT PREPARATION; INTERPRETATION. This Agreement will be considered
for all purposes as having been prepared through the joint efforts of the
Parties. No presumption will apply in favor of any Party hereto in the
interpretation of this Agreement or in the resolution of any ambiguity of any
provision hereof based on the preparation, substitution, submission or other
event of negotiation, drafting or execution hereof.
6.6 MODIFICATION AND AMENDMENT. This Agreement may not be modified or
amended except by an instrument in writing executed by each Party hereto.
6.7 NOTICES. Except as otherwise provided in this Agreement, any notice,
communication or other document required or permitted to be given or delivered
hereunder must be in writing and delivered by hand (including delivery by
commercial courier service), by registered or certified U.S. mail (postage
prepaid, return receipt requested) or electronic facsimile transmission to the
applicable address(es) specified below:
if to Zengen, Zensano or any other member of the Zengen Group, to:
Zengen, Inc.
21800 Oxnard Street, Suite 980
Woodland Hills, California 91367
Attention: Matthew C. Lipton
Fax: (818) 884-5988
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with a copy to:
Morgan, Lewis & Bockius LLP
300 South Grand Avenue, Suite 2200
Los Angeles, California
90071-31323
Attention: Matthew Burns
Fax: (213) 612-2554
if to Gum Tech or Gel Tech, to:
c/o Gum Tech International, Inc.
2375 East Camelback Road, Suite 500
Phoenix, Arizona 85016
Attention: President
Fax: (602) 387-4112
with a copy to:
Snell & Wilmer L.L.P.
One Arizona Center
400 E. Van Buren Street
Phoenix, Arizona 85004
Attention: Samuel C. Cowley
Fax: (602) 382-6070
Any notice which requires action or response by the receiving Party within a
contractually or statutorily defined time must reference the contract or
statutory provision relied upon and must identify the date on or before which
such action or response is required. Any notice which requires action or
response in less than thirty (30) days must be served both by same-day or
overnight courier and electronic facsimile transmission: Any Party hereto may
change its mailing address by notice to all other Parties given in the manner
herein prescribed. Any notice, communication or document delivered pursuant to
the provisions hereof will be deemed to have been delivered, if mailed, upon the
earlier of (i) actual receipt by the addressee, (ii) the date shown on the
return receipt of such mailing, or (iii) three (3) Business Days after deposit
in the mail. Any notice, communication or document delivered by hand (including
commercial courier service) will be deemed to have been delivered upon the
earlier of (i) actual receipt by the addressee, and (ii) the first Business Day
after deposit of such notice, communication or document with such courier
service. Any notice, communication or document delivered by electronic facsimile
will be deemed to have been delivered when sent (provided that a transmission
record is maintained by the sending Party), so long as it was received during
the receiving Party's normal working hours (8:00 a.m. to 5:00 p.m. local time)
on a Business Day, and otherwise such delivery will be deemed to be made as of
the next succeeding Business Day.
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6.8 TIME IS OF THE ESSENCE. Time is of the essence in this Agreement. Any
time limit mentioned herein has been carefully considered and represents the
agreed absolute outside limit of time within which a Party's applicable rights
must be exercised and obligations must be performed.
6.9 DURATION OF RIGHTS. Rights and obligations created by or arising under
this Agreement will terminate automatically upon termination of this Agreement,
except as otherwise expressly provided herein.
6.10 SUCCESSORS AND ASSIGNS. This Agreement will be binding upon the
Parties and their successors and permitted assigns. No Party may assign its
rights under this Agreement or delegate or dispose of its covenants and
obligations hereunder without the express written consent of each Party that is
the beneficiary of such covenants and obligations (which consent will be at such
Party's exclusive discretion). Notwithstanding, the foregoing sentence, any of
Gum Tech, Gel Tech, Zengen or Zensano may assign all of its rights hereunder to
a third party in connection with the sale to such third party of all or
substantially all of such Party's assets if such third party agrees to be bound
by the covenants and obligations hereunder of the assigning party, and provided
that such assignment will not relieve the assigning Party of its covenants and
obligations hereunder.
6.11 GOVERNING LAW. This Agreement will be governed by and interpreted in
accordance with the laws of the State of Arizona, including all matters of
construction, validity, performance and enforcement, without giving effect to
principles of conflict of laws.
6.12 FORUM FOR DISPUTES. All disputes arising out of, with respect to or in
connection with this Agreement or any of the transactions contemplated hereby
will be instituted and maintained only in the state or federal courts of
Maricopa County in the State of Arizona.
6.13 THIRD PARTY BENEFIT. Nothing in this Agreement, express or implied,
will confer on any Person other than the Parties or their respective successors
and permitted assigns, any right, remedy, obligation or liability under or by
reason of this Agreement.
6.14 COUNTERPARTS. This Agreement may be executed, in original form or by
electronic facsimile signature, and delivered in any number of counterparts,
each of which will be deemed as original and all of which together will
constitute one and the same instrument.
(REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK)
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IN WITNESS WHEREOF, each of the Parties has executed or caused this
Agreement to be executed as of the date first above written.
ZENGEN, INC.
--------------------------------------
Robert Davidson
By:
-----------------------------------
Name:
---------------------------------
Title:
-------------------------------- --------------------------------------
Matthew Lipton
ZENSANO, INC.
--------------------------------------
Henry (Hank) Landau
By:
-----------------------------------
Name:
---------------------------------
Title:
-------------------------------- --------------------------------------
Larry Kaye
GUM TECH INTERNATIONAL, INC.
--------------------------------------
Charles Hensley
By:
-----------------------------------
Carl J. Johnson
President
--------------------------------------
Michelle Rossow
GEL TECH, L.L.C.
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
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