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Sample Business Contracts

Master Transaction Agreement - Apple Inc., Liquidmetal Technologies Inc., Liquidmetal Coatings LLC and Crucible Intellectual Property LLC

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MASTER TRANSACTION AGREEMENT
 
between
 
Apple Inc.,
 
Liquidmetal Technologies, Inc.
 
Liquidmetal Coatings, LLC
 
and
 
Crucible Intellectual Property, LLC
 

 
Effective as of
 August 5, 2010
 

 
 
 
 
 
 
[*] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS AND AN ASTERISK, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

 
 

 
 
CONTENTS
 
1.
LMT Technology
1
     
2.
Transaction Approvals
5
     
3.
LMT-SPE Formation
6
     
4.
LMT Technology Transfers to LMT-SPE
7
     
5.
LMT Patent Prosecution
9
     
6.
LMT-SPE Existence and Separateness
13
     
7.
Due Diligence
16
     
8.
LMT Indebtedness and Liens
17
     
9.
LMT-SPE Licenses
18
     
10.
Covenant Not to Compete
21
     
11.
Confidentiality
23
     
12.
Independent Contractor
24
     
13.
Indemnification
24
     
14.
Term, Termination and Suspension of Performance
25
     
15.
Guaranty
27
     
16.
Miscellaneous
29
 
 
Annex 1:
Permitted Liens
 
Annex 2:
Approvals
 
Annex 3:
LMC Assignment Agreement
 
Annex 4:
LMT Contribution Agreement
 
Annex 5:
Form of Payoff Letter
 
Annex 6:
Apple License
 
Annex 7:
LMT License
 
Annex 8:
LMC License
 
Annex 9:
Technology Development Agreement
 
Annex 10:
LMT Security Agreement
 
Annex 11:
LMT-SPE Security Agreement
 
Annex 12:
Form of Release
 
Annex 13:
Patent Counsel Engagement Letter
 
Annex 14:
Due Diligence Checklist
 
Annex 15:
List of Excluded LMC Patents and Trademarks
 
 
i

 

CERTAIN DEFINITIONS

Agreement
Introduction
Apple
Introduction
Apple License Agreement
9(a)
Apple-Related Entities
9(f)
Approval
2(b)(iii)
business enterprise
6(j)
Caltech
1(e)
Caltech License
1(e)
Capture Period
1(a)(iv)
Closing Date
1(a)(i)
Consumer Electronic Products
10(a)
Due Diligence Checklist
7(a)
Guaranty
15(b)
indemnified party
13(a)
Intellectual Property
1(a)(ii)
Intellectual Property Rights
1(a)(iii)
Lien
1(b)(i)
LMC
Introduction
LMC License Agreement
9(c)
LMT
Introduction
LMT Controlled Patents/Applications
5(h)
LMT Fundamental Breach
14(e)
LMT License Agreement
9(c)
LMT-SPE Fundamental Breach
14(f)
LMT-Subs
15(a)
LMT Technology
1(a)(i)
Patent Counsel
5(c)
Prosecution and Maintenance Costs
5(b)
Transaction Documents
1(b)(viii)
 
 
ii

 

MASTER TRANSACTION AGREEMENT
 
This MASTER TRANSACTION AGREEMENT (this "Agreement") is made effective as of August 5, 2010, by and between Apple Inc., a California corporation having its principal place of business at 1 Infinite Loop, Cupertino, California 95014 ("Apple"), Liquidmetal Technologies, Inc., a Delaware corporation having its principal place of business at 30452 Esperanza, Rancho Santa Margarita, California 92688 ("LMT"), Liquidmetal Coatings, LLC, a Delaware limited liability company having its principal place of business at 900 Rockmead Drive, Suite 240, Kingwood, Texas 77339 ("LMC"), and Crucible Intellectual Property, LLC, a Delaware limited liability company having its principal place of business at 31441 Santa Margarita Pkwy., Suite A #247, Rancho Santa Margarita, CA 92688 ("LMT-SPE").
 
1.
LMT Technology.
 
 
(a)
For purposes of this Agreement:
 
 
(i)
"LMT Technology" shall mean any and all Intellectual Property and Intellectual Property Rights that, at any time during the Capture Period, are: (a) owned or licensed (including, without limitation, sub-licensed) by LMT or LMC, or that LMT or LMC have a right to use; or (b) owned or licensed (including without limitation sub-licensed) by LMT-SPE, or that LMT-SPE has a right to use, after being transferred to LMT-SPE by LMT or LMC. For the avoidance of doubt, any Intellectual Property Rights related to or arising from Intellectual Property first created, conceived, invented, or discovered before the end of the Capture Period shall be deemed to be within the definition of LMT Technology. Thus, for example, a patent application or copyright application filed, or any patent issued or copyright registration issued, more than five years after the Closing Date, but that is related to an invention conceived or work created within eighteen (18) months of the Closing date shall be deemed within the definition of LMT Technology. For purposes of clarification, however, improvements or derivatives of LMT Technology first created, conceived, invented, or discovered after the Capture Period shall not be "LMT Technology" notwithstanding the fact that such improvements or derivatives are derived from, improve, or otherwise relate to LMT Teclnology. The LMC patents and all LMC trademarks identified in Annex 15 hereto are excluded from "LMT Technology." "Closing Date" shall mean the date of the license granted to Apple pursuant to Section 9(a).

 
1

 
 
CONFIDENTIAL
  
 
(ii)
"Intellectual Property" shall mean and includes, but is not limited to, all algorithms, alloys, application program interfaces, compositions, customer lists, databases, schemata, equipment design, design documents and analyses, diagrams, documentation, drawings, formulae, discoveries and inventions (whether or not patentable), know-how, literary works, copyrightable works, works of authorship, manufacturing processes, mask works, logos, marks (including names, logos, slogans, and trade dress), methods, methodologies, architectures, processes, program listings, programming tools, proprietary information, protocols, schematics, specifications, software, software code (in any form including source code and executable or object code), subroutines, user interfaces, techniques, uniform resource locators, web sites, and all other forms and types of technology (whether or not embodied in any tangible form and including all tangible embodiments of the foregoing such as compilations of information, instruction manuals, notebooks, prototypes, reports, samples, studies, and summaries).
 
(iii)
"Intellectual Property Rights" shall mean and includes, but is not limited to, all past, present, and future rights of the following types, which may exist or be created under the laws of any jurisdiction in the world: (a) rights associated with works of authorship, including exclusive exploitation rights, copyrights, moral rights, and mask works; (b) trademark and trade name rights and similar rights; (c) trade dress rights; (d) trade secret rights; (e) patents and industrial property rights; (f) other proprietary rights in Intellectual Property of every kind and nature; and (g) all registrations, renewals, extensions, combinations, divisions, continuations, continuations in part, reexamination certificates, or reissues of, and applications for, any of the rights referred to in clauses (a) through (f) above.
 
(iv)
"Capture Period" shall mean the period commencing on the Closing Date and ending on the eighteen month anniversary of the Closing Date.
 
 
2

 
 
CONFIDENTIAL
  
 
(b)
LMT represents and warrants to Apple with respect to the portion of the LMT Technology existing as of the date of this Agreement:
 
 
(i)
Each of LMT and LMC has, immediately prior to its transfer, in the case of LMC, to LMT and, in the case of LMT, to LMT-SPE, good title to the portion of the LMT Technology which it purports to own and valid licenses and sublicenses to the portion of the LMT Technology which it purports to license and sublicense, in each case, free of Liens except for the Liens listed in Annex 1 and Liens that will be released and terminated on the Closing Date as a result of the transactions contemplated by this Agreement. A "Lien" is any security interest, mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, bailment, conditional sales or title retention agreement, lien (statutory or otherwise), charge against or interest in property, in each case of any kind, to secure payment of a debt or performance of an obligation.
 
 
(ii)
All licenses and sublicenses included in the LMT Technology permit the grant of the licenses, sublicenses and sub-sublicenses contemplated in the grant of the licenses that will be executed and delivered pursuant to Section 9 of this Agreement.
 
 
(iii)
Neither LMT nor LMC is in breach of, nor is there any default under, any license or sublicense included in the LMT Technology under which LMT or LMC is a licensee or sublicensee; nor has any licensor or sublicensor asserted any breach or default thereunder.
 
 
(iv)
The LMT Technology has not been specifically asserted against any third party, in a licensing or other context, in a manner in which the third party (A) has been accused of infringing or misappropriating the LMT Technology or (B) has standing to bring a declaratory judgment action.
 
 
(v)
The LMT Technology has not been, and is not, the subject of any threatened, pending or past litigation, reexamination, reissue or interference proceeding, or other interested parties legal proceeding before any tribunal of competent jurisdiction.
 
 
(vi)
There is no pending or, to the knowledge of LMT and LMC, any threatened claim that the use of the LMT Technology infringes any third party Intellectual Property Rights and, to the knowledge of LMT and LMC, there is no basis for any such claim.
 
 
(vii)
There is no patent claim in the LMT Technology that has been found to be invalid or unenforceable, in whole or in part, for any reason, in any administrative, arbitration or judicial proceeding before a tribunal of competent jurisdiction, and LMT and LMC have not received notice from any third party threatening the filing of any such proceeding.
 
 
(viii)
No litigation or other proceeding has been initiated or, to LMT's knowledge, threatened against any of the LMT Technology, LMT or LMC or either the transactions contemplated under this Agreement or the agreements that are contemplated to be executed and delivered by such parties pursuant to Section 9 (collectively, the "Transaction Documents" or by Apple in connection with such transactions.
 
 
3

 
 
CONFIDENTIAL
 
(ix)
The LMT Technology is not subject to any express or implied licensing obligations of a standards body or patent pool.
 
(x)
LMT and LMC have not contributed computer code patented in the LMT Technology to an open source computer program or otherwise made any contributed computer code patented in the LMT Technology subject to the obligations of an copyright license for computer software that makes the source code available under terms that allow for modification and redistribution without having to pay the original author.
 
(xi)
All patent applications for the LMT Technology were, have been, and continue to be duly maintained in accordance with the requirements of the United States Patent and Trademark Office and any foreign patent offices, including but not limited to the payment of all maintenance fees, annuities and other payments owed.
 
(c)
The representations made in Section 1(b) will be repeated as of the Closing Date (if different from the date of this Agreement).
 
(d)
At all times during the term of this Agreement, LMT and LMT-SPE, as applicable, shall notify Apple as soon as possible and in any event within ten (10) days after LMT or LMT-SPE knows, or has reason to know, of any of the events described below:
 
(i)
That LMC or LMT has any claim, or any of their respective sublicensees has notified or otherwise advised LMT or LMC that it may have a claim, that it reasonably anticipates it may or intends to assert under the LMT Technology against any third party, in a licensing or other context, in a manner in which the third party (A) would be accused of infringing or misappropriating the LMT Technology or (B) would have standing to bring a declaratory judgment action.
 
(ii)
The LMT Technology shall be the subject of any threatened litigation, reexamination, reissue or interference proceeding, or other interested parties legal proceeding before any tribunal of competent jurisdiction.
 
(iii)
Any claim that use of the LMT Technology infringes any third party Intellectual Property Rights shall be threatened or asserted.
 
(iv)
Any patent claim in the LMT Technology shall be found to be invalid or unenforceable, in whole or in part, for any reason, in any administrative, arbitration, or judicial proceeding before a tribunal of competent jurisdiction.
 
(v)
Any litigation or other proceeding shall have been initiated or threatened against any of the LMT Technology, LMT, LMT-SPE or LMC or the transactions contemplated under Transaction Documents or Apple in connection with such transactions.

 
4

 
 
CONFIDENTIAL
 
(e)
LMT confirms that Apple has been authorized to have direct communications, conversations and discussions with California Institute of Technology ("Caltech") and its employees for the purpose of investigating the validity, utility and value of the Amended and Restated License Agreement dated as of September 1, 2001 ("Caltech License") between Caltech, as licensor, and LMT, as licensee, and the continued enforceability of the Caltech License against Caltech.
 
2.
Transaction Approvals.
 
(a)
Concurrently with its execution and delivery of this Agreement to Apple, each of LMT and LMC shall deliver to Apple a certificate of its secretary or managing member, certifying (i) its certificate of incorporation or formation, as applicable, (ii) its bylaws or operating agreement, as applicable, (iii) resolutions adopted by its directors or managing member, as applicable, and (iv) the incumbency of the officers who have executed this Agreement and are authorized to execute the other Transaction Documents to which it will be a party, all in form and substance satisfactory to Apple.
 
(b)
LMT and LMC each represents and warrants to Apple (provided that LMC shall not be liable for any breach of the following representations and warranties by LMT):
 
(i)
It is duly incorporated or formed, validly existing and in good standing in its state of formation and qualified and licensed to do business in, and in good standing in, any state in which the conduct of its business or its ownership of property requires that it be qualified.
 
(ii)
The execution, delivery and performance of Transaction Documents have been duly authorized, and do not conflict with its certificate of incorporation or formation, bylaws, and operating agreement, nor constitute an event of default under any agreement by which it is bound.
 
(iii)
No authorization, consent, approval, license, lease, ruling, permit, certification, exemption, filing for registration by or with any federal, regional, state, local or regulatory or administrative authority or other person ("Approval") is required for its execution and delivery of this Agreement, which Approval has not been obtained and a copy of which has been provided to Apple; and such Approvals are in full force and effect;
 
(iv)
No Approval is required for the execution and delivery of the other Transaction Documents, and the performance by each of LMT and LMC of their obligations under this Agreement and under the Transaction Documents, except for the Approvals listed on Annex 2 which have been obtained and are in full force and effect.

 
5

 
 
CONFIDENTIAL
 
(v)
It has duly executed and delivered this Agreement and, when it has executed and delivered the other Transaction Documents to which it is a party, such Transaction Documents. Each Transaction Document to which it is a party constitutes or, when executed and delivered, will constitute the legal, valid and binding obligations of such party enforceable in accordance with its respective terms, except as the enforceability hereof or thereof may be limited by (a) bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement of creditors' rights generally and (b) general equitable principles (whether considered in a proceeding in equity or at law).
 
(c)
The representations made in Section 2(b) will be repeated as of the Closing Date (if different from the date of this Agreement).
 
(d)
On or before the Closing Date, LMT shall obtain or shall have obtained and delivered to Apple a copy of each Approval listed on Annex 2.
 
(e)
On or prior to the Closing Date, LMT shall deliver or shall have delivered to Apple an opinion of special Delaware counsel to the effect that the approval of LMT's shareholders is not required for the execution and delivery, and the performance of the obligations under, the Transaction Documents by LMT, LMC or LMT-SPE, such opinion to be based on assumptions provided by Apple and to be otherwise in form and substance satisfactory to Apple.
 
3.
LMT-SPE Formation.
 
(a)
On or before the Closing Date, LMT-SPE shall deliver or shall have delivered to Apple a certificate of its secretary, certifying the (i) certificate of formation of LMT-SPE, (ii) the limited liability company agreement of LMT-SPE, (iii) resolutions adopted by the directors of LMT-SPE resolving that it is in the best interests of LMT-SPE to execute and deliver such agreements, to perform the obligations and consummate the transactions contemplated herein, approving all agreements to which LMT-SPE shall become a party pursuant to this Agreement, and authorizing its officers to execute and deliver such agreements, to perform the obligations and consummate the transactions contemplated therein, and (iv) the incumbency of the officers of LMT-SPE who have executed this Agreement and are authorized to execute the other Transaction Documents to which it will be a party, all in form and substance satisfactory to Apple.
 
(b)
LMT-SPE represents and warrants to Apple on the date of this Agreement:
 
(i)
It has been duly incorporated and is validly existing and in good standing in its state of formation and qualified and licensed to do business in, and in good standing in, any state in which the conduct of its business or its ownership of property requires that it be qualified.
 
(ii)
The execution, delivery and performance of Transaction Documents to which it will be a party have been duly authorized, and do not conflict with LMT's, LMC's or its certificate of incorporation or formation, bylaws, and operating agreement, nor constitute an event of default under any agreement by which LMT, LMC or it is bound.

 
6

 
 
CONFIDENTIAL
 
(iii)
No Approval is required for (A) its execution and delivery of this Agreement, and (B) its execution and delivery of the other Transaction Documents and its performance of its obligations hereunder and thereunder, except for the Approvals listed on Annex 2 which have been obtained and are in full force and effect.
 
(iv)
It has duly executed and delivered this Agreement and, when it has executed and delivered the other Transaction Documents to which it will be a party, such Transaction Documents. Each Transaction Document to which it is a party constitutes or, when executed and delivered, will constitute the legal, valid and binding obligations of such party enforceable in accordance with its respective terms, except as the enforceability hereof or thereof may be limited by (a) bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement of creditors' rights generally and (b) general equitable principles (whether considered in a proceeding in equity or at law).
 
(v)
Each of the representations and warranties in Section 1(b) is true and correct, except that the references to LMT and LMC therein shall be deemed to be references to LMT-SPE, mutatis mutandis.
 
(c)
The representations made in Section 3(b) will be repeated as of the Closing Date (if different from the date of this Agreement).
 
4.
LMT Technology Transfers to LMT-SPE.
 
(a)
On the Closing Date, LMC shall, pursuant to an assignment in the form of Annex 3, absolutely and unconditionally assign to LMT, and LMT shall accept from LMC, all of LMC's right, title and interest in and to the LMT Technology that LMC shall own at that time and that it might subsequently develop or acquire during the Capture Period. Notwithstanding the foregoing, LMC shall not be required to transfer to LMT the rights granted back to LMC under the LMC License or the Amended and Restated License and Technical Services Agreement of even date herewith between LMT and LMC.
 
(b)
On the Closing Date and after giving effect to the assignment set forth in Section 4(a) above, LMT shall, pursuant to an assignment in the form of Annex 4, absolutely and unconditionally assign to LMT-SPE, and LMT-SPE shall accept from LMT, all of LMT's right, title and interest in and to the LMT Technology that LMT shall own at that time and that it might subsequently develop or acquire during the Capture Period. Notwithstanding the foregoing, LMT shall not be required to transfer to LMT-SPE the rights granted back to LMT under the LMT License or the Amended and Restated License and Technical Services Agreement of even date herewith between LMT and LMC.

 
7

 
 
CONFIDENTIAL
 
(c)
LMT and LMC shall cause each employee who contributes or will contribute to the development of LMT Technology to execute and deliver to LMT-SPE an assignment agreement, in form and substance satisfactory to Apple, that recites that all LMT Technology the employees creates, conceives of and invents prior to and during the Capture Period shall be assigned to LMT-SPE. LMT shall deliver copies of such assignment agreements to Apple on the Closing Date.
 
(d)
No later than the fifteenth (15th) day of each month until the end of the Capture Period, LMT shall deliver to Apple a written report, in form and substance satisfactory to Apple, describing in reasonable detail each the work of research and development project and each new Intellectual Property Right that has been created or acquired, whether as owner, licensee, sublicensee or otherwise, and whether or not registered or an application for registration has been made.
 
(e)
Following the transfer made pursuant to Section 4(b), LMT shall make all necessary or appropriate filings with respect to the LMT Technology transferred to LMT-SPE to ensure that all Intellectual Property and Intellectual Property Rights included in such LMT Technology that are to be registered with the applicable governmental or other registration authority have been so registered.
 
(f)
Until the end of the Capture Period, LMT shall, and shall cause each of its subsidiaries to, maintain records documenting the activities and work initiated, completed and otherwise performed and all written and electronic communications by its employees with respect to each of its research and development projects and each new Intellectual Property Right that has been created or acquired, whether as owner, licensee, sublicensee or otherwise, and whether or not registered or an application for registration has been made, for a period of not less than three years after the year in which such activities, work and communications occurred.
 
(g)
Apple may, by notice to LMT, request the audit of the books and records of LMT and its subsidiaries with respect to all aspects relating to Apple's exercise of its rights, powers and privileges, the performance by LMT and its subsidiaries of its and their obligations and the discharge by them of their liabilities under the Transaction Documents. Following its receipt of such notice, LMT shall, as determined by Apple, provide copies to Apple or make available to Apple or any representatives designated by it to conduct such audit, all books and records which Apple shall determine are relevant to the scope of the audit.
 
(h)
Prior to LMT, LMC or any of their respective sublicensees asserting any claim against a third party under the LMT Technology or upon request by Apple (which may be made from time to time), LMT or LMC, or both, shall (i) meet with and give Apple an opportunity to provide guidance and comments, as Apple deems appropriate, concerning any claim LMC, LMT or any of their respective sublicensees may be able to assert against third parties under the LMT Technology, including, without limitation, any strategy or tactics any such claimant may be contemplating pursuing to press such claims; and (ii) not unreasonably ignore, disregard or otherwise reject Apple's guidance and comments and shall, as appropriate, modify relevant aspects of such claims, including the anticipated legal strategy and tactics, consistent with such guidance or comments unless there is a reasonable basis for it or them not to do so. The obligations imposed by this Section 4(h) shall be in addition to the obligation to give notice set forth in Section 1(d).

 
8

 
 
CONFIDENTIAL
 
5.
LMT-SPE Patent Prosecution.
 
(a)
Apple shall have the sole and exclusive right, in the United States and other jurisdictions around the world, to control patent prosecution for inventions, current and future patent applications and patents included within the LMT Technology. Patent prosecution activities include, without limitation:
 
(i)
soliciting and receiving invention disclosures from inventors, including employees and contractors of LMT and LMC;
 
(ii)
determining whether to file a patent application based on the invention disclosure;
 
(iii)
determining whether to maintain as a trade secret, instead of filing a patent application, any invention, technical know-how or other information contained in an invention disclosure;
 
(iv)
preparing a patent application based on the invention disclosure;
 
(v)
determining the type and scope of patent applications that should be filed, determining the jurisdictions in which the patent applications should be filed and determining the timing of filing of such patent applications;
 
(vi)
determining whether and when to file one or more additional patent applications worldwide based on the filed patent application including, without limitation, determining whether to file an international application under the Patent Cooperation Treaty (including designation decisions), a regional application (e.g., in the European Patent Office, including all validation decisions), and/or directly in any national patent office;
 
(vii)
providing support and assistance to selected patent counsel to prepare and file foreign patent applications;

 
9

 
 
CONFIDENTIAL
 
(viii)
determining whether and how to respond to informality rejections (e.g., Notices to File Missing Parts) received from the United States Patent and Trademark Office and other patent offices;
 
(ix)
responding to informality rejections;
 
(x)
determining whether and how to respond to substantive communications (e.g., office actions) received from the United States Patent and Trademark Office and other patent offices;
 
(xi)
responding to substantive patent office communications;
 
(xii)
communicating with LMT or LMC personnel for assistance regarding substantive patent office communications;
 
(xiii)
determining whether to abandon patent applications;
 
(xiv)
subject to Section 5(b) below, determining whether and when to pay publication, issue, grant, recordation, and registration fees, including, without limitation, when patent applications are published, accepted, granted, or otherwise allowed;
 
(xv)
subject to Section 5(b) below, paying publication, issue, grant, recordation, and registration fees;
 
(xvi)
submitting prior art known by inventors and reported to Apple to the United States Patent and Trademark Office and foreign patent offices according to the requirements of the patent offices;
 
(xvii)
determining whether and when to file divisional, continuation, continuation-in-part, reexamination, and/or reissue patent applications based on pending patent applications and issued patents;
 
(xviii)
responding to patent office communications in all patent office proceedings in all jurisdictions, including without limitation, examination, reexamination, reissue, and opposition proceedings;
 
(xix)
communicating with LMT or LMC personnel for assistance regarding patent office communications in all patent office proceedings in all jurisdictions, including without limitation, examination, reexamination, reissue, and opposition proceedings

 
10

 
 
CONFIDENTIAL
 
(xx)
determining whether to respond to patent office communications relating to any patent under examination, reexamination, reissue, and opposition proceedings;
 
(xxi)
determining whether and when to abandon applications under examination, reexamination, reissue or opposition proceedings;
 
(xxii)
determining whether to pay annuity fees for foreign filed patent applications and foreign patents;
 
(xxiii)
subject to Section 5(b) below, paying annuity fees for foreign filed patent applications and foreign patents;
 
(xxiv)
determining whether and when to pay maintenance fees for United States patents;
 
(xxv)
subject to Section 5(b) below, paying maintenance fees for United States patents; and
 
(xxvi)
determining whether to file requests for certificates of corrections or other corrective measures for issued patents in the United States and abroad.
 
(b)
Apple shall bear the cost of all patent prosecution and maintenance for inventions, current and future patent applications and patents included within the LMT Technology, including, without limitation, patent counsel legal fees and patent office fees and maintenance and annuity fees (collectively "Prosecution and Maintenance Costs"), provided, however, that that Apple shall not be responsible for any Prosecution and Maintenance Fees for patentable inventions as to which Apple has elected not to prosecute pursuant to Section 5(e) or patents or patent applications as to which Apple has elected not to maintain pursuant to Section 5(e), provided that Apple shall have first provided no less than thirty (30) days' prior written notice of such election to LMT-SPE.
 
(c)
LMT-SPE agrees to utilize legal counsel identified by Apple and approved by LMT-SPE ("Patent Counsel"), such approval not to be unreasonably withheld, for patent prosecution of inventions, current and future patent applications and patents within the LMT Technology to which LMT-SPE has decided to exercise under Section 5(d). Patent Counsel will sign and execute an engagement letter in the form of Annex 13, with appropriate conflict wavers, identifying that Patent Counsel represents both Apple and LMT-SPE.

 
11

 
 
CONFIDENTIAL
 
(d)
LMT-SPE and Apple agree that Patent Counsel shall be instructed to prepare and send to Apple and LMT-SPE a quarterly patent prosecution report that will include such matters as each of Apple and LMT-SPE shall direct and shall include, without limitation: (i) information identifying invention disclosures on which Apple has decided not to file patent applications, such inventions to be treated as trade secrets, and to file patent applications; (ii) jurisdictions where Apple has decided to file patent applications; (iii) which patent applications Apple has decided to let go abandoned; (iv) any continuations, continuation-in-parts, or divisional applications Apple has decided to file, and (v) what fees, (including without limitation, issue fees, publication fees, maintenance fees, grant fees and annuity fees), Apple intends to pay. Apple shall attempt to arrange a meeting with LMT-SPE or its representatives in person or telephonically, at least once each calendar quarter to review the most recent quarterly report.
 
(e)
If with respect to a patentable invention (x) Apple has decided not to prosecute the application for a patent thereof and not to require that such invention be treated as a trade secret or (y) Apple has decided 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, as disclosed to LMT-SPE in a quarterly report or by Apple at its quarterly meeting with LMT-SPE, LMT-SPE may, at its sole cost and expense, (i) file a patent application on a submitted invention disclosure described in clause (x); (ii) file foreign patent applications in jurisdictions not selected to be pursued by Apple or file a Patent Cooperation Treaty application for an invention described in clause (y); (iii) take over patent prosecution of any patent application that Apple has determined is to be abandoned; (iv) file a continuation, divisional or continuation-in-part application based on a pending patent application if Apple determines not to file the continuation, divisional or continuation-in-part application; (v) pay an annuity fee for a foreign patent application if Apple has determined not to pay the annuity fee; and (vi) pay a maintenance fee for a United States patent or a foreign patent for an invention if Apple has determined not to pay the maintenance fee. In connection with any patent application as to which Apple has decided not to prosecute, LMT-SPE shall retain intellectual property counsel reasonably acceptable to Apple
 
(f)
Patent Counsel shall be instructed by LMT-SPE to set up a joint customer number in the United States Patent Office for Apple and LMT-SPE to allow Apple and LMT- SPE to monitor prosecution activities for all patent applications within the United States.
 
(g)
With respect with patent preparation, patent prosecution, and patent maintenance related activities recited in Section 5(a), Apple shall have no responsibility, no liability, nor any further obligation to LMT, LMC or LMT-SPE beyond those specifically provided for herein.

 
12

 
 
CONFIDENTIAL
 
(h)
Should LMT-SPE decide to exercise any of the rights recited in Section 5(e) and take control over specific applications or patents (collectively, the "LMT Controlled Patents/Applications"), LMT-SPE shall consult with Apple and Patent Counsel, and allow Apple and Patent Counsel to comment on, any filing of a patent application, any amendment thereto, whether voluntary or involuntary, any "Reply to Office Action," any "Information Disclosure Statement," or similar filing, participating in an interview with a patent examiner with respect to such a patent application, or any similar action, in each case before LMT-SPE or its counsel shall file such patent application, amendment, or other filing, participate in such interview or take such other action. LMT-SPE shall instruct Patent Counsel to ensure that with respect to all patent office communications in all patent office proceedings in all jurisdictions concerning the LMT Controlled Patents/Applications:
 
(i)
LMT-SPE does not take positions in patent office proceedings adverse or inconsistent with positions taken by Apple and Patent Counsel, and
 
(ii)
LMT-SPE and Apple conform to patent office rules and regulations regarding submission of prior art.
 
(i)
LMT and LMC employees shall provide cooperation and support to Apple (and) Patent Counsel to support patent prosecution activities for inventions, current and future patent applications and patents included within the LMT Technology. This cooperation and support will be provided at no charge to Apple. The Patent Counsel has the sole discretion to determine when the cooperation and support is necessary to support the patent prosecution activities.
 
(j)
Concurrently with its delivery of each monthly report pursuant to Section 4(d), LMT, LMC and LMT-SPE each shall execute and deliver to Apple a release, in the form of Annex 12, pursuant to which it shall release Apple of all claims it may have against Apple that it may have in connection with any loss, liability, damage, action, cause of action or any other matter whatsoever that may have arisen in relation to the exercise of any right, power or privilege or the performance or discharge of any obligation under Section 5(a).
 
6.
LMT-SPE Existence and Separateness.
 
(a)
LMT-SPE shall (i) do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and its rights and franchises; (ii) conduct its business substantially as conducted immediately after the transactions contemplated in Sections 4(b) and 9(a) and (c) are consummated; (iii) at all times maintain, preserve and protect all of its assets and properties used or useful in the conduct of its business, including all licenses, permits, charters and registrations; and (iv) transact business only in the name of Crucible Intellectual Property, Inc.
 
(b)
LMT-SPE shall not (i) engage in any business other than as provided in its certificate of formation, limited liability company agreement and the Transaction Documents, (ii) make any change in its capital structure, including, without limitation, the issuance of any additional membership interests, warrants or other securities convertible into membership interests or any revision of the terms of its outstanding membership interests, (iii) amend, waive or modify any term or provision of its certificate of formation or limited liability company agreement, (iv) make any change to its name indicated on the public records of its jurisdiction of organization or (v) change its jurisdiction of organization.

 
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(c)
LMT-SPE shall pay, perform and discharge or cause to be paid, performed and discharged promptly all charges and claims payable by it, including (i) all federal, state, provincial, county, city, municipal, local, foreign or other governmental taxes; (ii) all levies, assessments, charges, or claims of any governmental entity or any claims of statutory lienholders, the nonpayment of which could give rise by operation of law to a Lien on the LMT Technology or any other property of LMT-SPE; and (iii) lawful claims for labor, materials, supplies and services or otherwise before any thereof shall become past due.
 
(d)
LMT-SPE shall (i) perform each of its obligations under this Agreement and the other agreements to which it is a party and (ii) comply with all federal, state and local laws and regulations applicable to it and the LMT Technology.
 
(e)
LMT-SPE shall not sell, transfer, convey, assign or otherwise dispose of, or assign any right to receive income in respect of, any of its properties or other assets or any of its stock (whether in a public or a private offering or otherwise), any LMT Technology or agreement therefore except as otherwise expressly permitted by this Agreement.
 
(f)
LMT-SPE shall not create, incur, assume or permit to exist any claim of ownership or Lien on or with respect to the LMT Technology or with respect to its other properties or assets (whether now owned or hereafter acquired) except for the Liens in favor of Apple.
 
(g)
LMT-SPE shall not become a party to any agreement, note, indenture or instrument other than (i) the assignments described in Sections 4(b) and (c), (ii) the licenses described in Sections 9(a) and (c), (iii) any agreements necessary to establish a bank account in its own name, and (iv) any new agreements or amendments in furtherance of this Agreement or the other Transaction Documents.
 
(h)
LMT-SPE shall not amend, modify or waive any term or provision of the assignments described in Section 4(b) or (c) the licenses described in Section 9(c) without Apple's prior written consent.
 
(i)
LMT-SPE shall not directly or indirectly, by operation of law or otherwise, (i) form or acquire any equity interests in any partnership, joint venture, unincorporated organization, trust, association, corporation (including a business trust), limited liability company, institution, public benefit corporation, joint stock company, or any other entity of whatever nature, or (ii) merge with, consolidate with, acquire all or substantially all of the assets or capital stock of, or otherwise combine with or acquire, any partnership, corporation, limited liability company, or any other entity of whatever nature.

 
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(j)
LMT-SPE shall not make any investment in, or make or accrue loans or advances of money to, any person, corporation, firm, joint venture, partnership, limited liability company, association, enterprise, trust or other entity or organization ("business enterprise"), including, without limitation, any director or officer or employee of LMT-SPE, LMT or any direct or indirect subsidiary of LMT, through the direct or indirect lending of money, holding of securities or otherwise.
 
(k)
Except as required by U.S. generally accepted accounting principles, LMT, LMC and LMT-SPE shall not make statements or disclosures, prepare any financial statements or in any other respect account for or treat the transactions contemplated by the assignments described in Sections 4(b) and (c)(ii) (including for accounting, tax and reporting purposes) in any manner other than as an increase in the stated capital of LMT-SPE.
 
(I)
LMT-SPE shall not at any time declare any distributions, repurchase any membership interest, return any capital, or make any other payment or distribution of cash or other property or assets in respect of LMT-SPE's membership interest, other than from payments received from Apple pursuant to Section 9(b).
 
(m)
LMT-SPE shall not create, incur, assume or permit to exist any indebtedness or liabilities, except for taxes and trade payables incurred in the ordinary course of business.
 
(n)
To the extent that LMT-SPE has cash, it will maintain its own deposit account or accounts, separate from those of LMT and its subsidiaries, with commercial banking institutions and ensure that its funds will not be used for other than its corporate uses, nor will such funds be commingled with the funds of any of LMT and its subsidiaries and vice versa.
 
(o)
LMT-SPE will maintain a separate address from the address of LMT and its subsidiaries and vice versa, or to the extent LMT-SPE may have offices in the same location as LMT or its Subsidiaries, maintain a fair and appropriate allocation of additional, incremental overhead costs among them, with each such entity bearing its fair share of such expense.
 
(p)
LMT-SPE will issue separate financial statements prepared not less frequently than quarterly and prepared in accordance with generally accepted accounting principles, consistently applied (except for the omission of certain footnotes and other presentation items required by the generally accepted accounting principles, consistently applied, with respect to audited financial statements), which financial statements need not be separately audited or reviewed by an independent accounting firm.
 
(q)
LMT-SPE will observe all necessary, appropriate and customary company (or corporate) formalities, including, but not limited to, holding all regular and special members' and board of directors' meetings appropriate to authorize all limited liability company action, keeping separate and accurate minutes of its meetings, passing all resolutions or consents necessary to authorize actions taken or to be taken, and maintaining accurate and separate books, records and accounts, including, but not limited to, payroll and intercompany transaction accounts, to the extent applicable.

 
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(r)
LMT-SPE will use its best efforts to refrain from using the stationery of any of LMT and its subsidiaries and shall instead make all written communications in its own name and vice versa; provided that in the event that any affiliate of LMT conducts business on behalf of LMT-SPG, such agency relationships shall be fully disclosed to applicable third parties when acting in such capacity.
 
(s)
LMT-SPE will conduct all its business in its own name and use its best efforts to avoid the appearance that it is conducting business on behalf of any other affiliate of LMT and vice versa, provided that in the event that either LMT-SPE, on the other hand, or affiliate of LMT conducts business on behalf of any member of the other Group, such agency relationship shall be fully disclosed to applicable third parties when acting in such capacity.
 
7.
Due Diligence.
 
(a)
On or prior to the Closing Date, LMT shall provide or shall have provided complete and accurate replies to all questions and items requested on the due diligence checklist Apple provided LMT and attached hereto as Annex 14 ("Due Diligence Checklist"). Any information included in the "Notes" column of the Due Diligence Checklist is provided by LMT solely for purposes of convenience and is not deemed to be LMT's exclusive reply or response to the questions and items requested on the Due Diligence Checklist.
 
(b)
LMT hereby represents and warrants to Apple that it has provided all material information of a nature or type that would influence the decision of a reasonable person that Apple has requested in the Due Diligence Checklist. The representation and warranty in this Section 7(b) will be repeated on and as of the Closing Date (if different from the date of this Agreement).
 
(c)
In addition to and exclusive of the factual information provided pursuant to the Due Diligence Checklist, LMT hereby represents and warrants that all factual information taken as a whole furnished by or on behalf of LMT or its subsidiaries in writing to Apple for purposes of or in connection with this Agreement or the other Transaction Documents and all other such factual information taken as a whole heretofore or hereafter furnished by or on behalf of LMT or its subsidiaries in writing to Apple, will be, true and accurate, in all material respects, on the date as of which such information is dated or certified and not incomplete by omitting to state any fact necessary to make such information (taken as a whole) not misleading in any material respect at such time in light of the circumstances under which such information was provided. The representation and warranty in this Section 7(c) will be repeated as of the Closing Date (if different from the date of this Agreement).

 
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8.
LMT Indebtedness and Liens.
 
(a)
On or prior to the Closing Date, LMT and LMC shall identify or shall have identified to and shall provide or shall have provided Apple copies of all documents evidencing and otherwise relating all of the following:
 
(i)
all indebtedness of LMT and LMC for borrowed money or for the deferred purchase price of property or services payment;
 
(ii)
all reimbursement and other obligations with respect to letters of credit, bankers' acceptances and surety bonds, whether or not matured;
 
(iii)
all obligations evidenced by notes, bonds, debentures or similar instruments and all indebtedness created or arising under any conditional sale or other title retention agreement with respect to property acquired by LMT and LMC (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property);
 
(iv)
all leases for any property (whether real, personal or mixed) that, in accordance with generally accepted accounting principles, would be required to be classified and accounted for as a capital lease on a balance sheet of LMT or LMC;
 
(v)
all obligations of LMT and LMC under commodity purchase or option agreements or other commodity price hedging arrangements, in each case whether contingent or matured;
 
(vi)
all obligations of LMT and LMC under any foreign exchange contract, currency swap agreement, interest rate swap, cap or collar agreement or other similar agreement or arrangement designed to alter the risks of LMT and LMC arising from fluctuations in currency values or interest rates, in each case whether contingent or matured;
 
(vii)
all guaranties for any of the foregoing;
 
(viii)
all indebtedness referred to in clauses (i) through (vii) above secured by (or for which the holder of such indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in property or other assets (including accounts and contract rights) owned by LMT or LMC, even though LMT and LMC has not assumed or become liable for the payment of such indebtedness; and
 
(ix)
obligations of LMT and LMC to trade creditors incurred in the ordinary course of business that are overdue by more than 120 days or exceed $25,000.
 
(b)
On or prior to the Closing Date, LMT and LMC shall provide or shall have provided copies of Uniform Commercial Code, tax and judgment lien searches in all jurisdictions in which Apple requests such searches, and shall identify or shall have identified to Apple all Liens on their respective assets, including the LMT Technology.

 
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(c)
On or prior to the Closing Date, Apple shall identify or shall have identified those creditors and lien holders of LMT whom shall be paid from the consideration Apple will pay LMT-SPE pursuant to Section 9(b).
 
(d)
On or prior to the Closing Date, LMT shall obtain or shall have obtained from each creditor and holder of Liens on its assets identified by Apple a payoff letter in substantially the form of Annex 5 or a document otherwise in form and substance satisfactory to Apple, (i) setting forth the amount owed to such creditor or lien holder, (ii) the account into which such amount shall be paid, (iii) an acknowledgment that when such creditor or lien holder has been paid such amount no further amounts will be owed to it by LMT, and (iv) except for trade creditors, releasing LMT of all further claims.
 
(e)
LMT-SPE shall be deemed to have received and distributed to LMT all payments made by Apple pursuant to the Apple License Agreement. LMT-SPE and LMT hereby authorize and direct Apple to pay directly those creditors and holders of Liens identified by Apple as creditors and lienholders of LMT to be paid from the proceeds of the payments made by Apple on the Closing Date pursuant to the Apple License Agreement and from whom payoff letters or other releases satisfactory to Apple have been obtained. Nothing in this Section 8(f) shall obligate Apple to pay the consideration other than on the terms and subject to the conditions specified in the Apple License Agreement.
 
(f)
LMT shall ensure that upon the payments contemplated in Section 8(e) being made to its creditors and holders of Liens on its assets no Liens, other than Liens in favor of Apple, shall exist on its assets.
 
(g)
LMT represents and warrants that upon the payments contemplated in Section 8(e) being made, the LMT Technology will be free and clear of all Liens except for any Liens in favor of Apple. This representation and warranty will be repeated as of the Closing Date (if different from the date of this Agreement).
 
(h)
From and after the date on which the payments contemplated in Section 8(e) are made, LMT shall not, and shall ensure that none of its direct or indirect subsidiaries shall, create, incur, assume or permit to exist allow any Lien on the shares or any equity interests of LMT-SPE or any portion of the LMT Technology in which it might have any right, title or interest, including, without limitation, inventions, trade secrets, patent applications and other proprietary rights which LMT and LMC are obligated hereunder to transfer to LMT-SPE.
 
9.
LMT-SPE Licenses.
 
(a)
LMT-SPE shall execute and deliver to Apple a license agreement in the form of Annex 6 (the "Apple License Agreement") upon its receipt of notice from Apple that the conditions precedent in Section 9(d) have been satisfied or waived and Apple is prepared to make the Initial Payment (as defined in the Apple License Agreement).

 
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(b)
Upon its receipt from LMT-SPE of the Apple License Agreement, Apple shall pay the Initial Payment thereunder in accordance with the Apple License Agreement and the Escrow Agreement of even date herewith among the parties hereby and US Bank, N.A. Apple shall deduct from the Final Payment (as defined in the Apple License Agreement) repayment of $[*] in advances made to LMT prior to the date of this Agreement. Any further payments by Apple in consideration for the license granted pursuant to Section 8(a) shall be made as provided in the Apple License Agreement.
 
(c)
Also on the Closing Date, LMT-SPE shall execute and deliver to (i) LMT a license in the form of Annex 7 (the "LMT License Agreement") (ii) LMC a license in the form of Annex 8 (the "LMC License Agreement").
 
(d)
Apple's obligations to accept the Apple License Agreement and to make the Initial Payment thereunder shall be further subject to the satisfaction or written waiver, in Apple's sole discretion of the following conditions precedent:
 
(i)
LMT, LMC and LMT-SPE shall have performed all their obligations set forth in Sections 1, 2, 3, 5, 6, 7 and 8;
 
(ii)
All representations and warranties in Sections 1(b), 2(b), 3(g), 7(b), 7(c), 8(g) and 8(h) shall be true and correct as of the date on which all other conditions in this Section 9(d) are satisfied or waived by Apple;
 
(iii)
Apple shall have received and approved an opinion of California counsel to LMT and LMC as to corporate status (and equivalent for other business entities); valid existence; good standing; corporate power and action (and equivalent for other business entities); due authorization, execution and delivery; no violation of articles and bylaws (and equivalent for other business entities), material agreements, court orders, applicable law; all filings, consents and approvals obtained in connection with the transactions; and to the knowledge of such attorneys no litigation or like proceedings are pending regarding the Transaction Documents, and that the Transaction Documents are fully enforceable;
 
(iv)
As to LMT-SPE, a Delaware limited liability company, Apple shall also have received, and approved an opinion of Delaware counsel that LMT-SPE as to its limited liability company status, valid existence, good standing, limited liability company power and action, due authorization, enforceability, execution and delivery of all Transaction Documents, no violation of its articles and bylaws, material agreements, court orders, compliance with applicable law, all filings, consents and approvals obtained in connections with the transactions, that the authorized capital stock of LMT-SPE are duly authorized, validly issued and fully paid and non-assessable further that LMT-SPE's assets, in light of the structure of LMT-SPE, and the restriction on its formation, and future operations will not be consolidated with LMT's or LMC's assets in any bankruptcy case;
 

[*] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS AND AN ASTERISK, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

 
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(v)
LMT shall have executed and delivered to Apple a technology development agreement in the form of Annex 9;
 
(vi)
LMT shall have delivered to Apple a security agreement in the form of Annex 10, which security agreement shall exclude from the collateral LMT's interest in LMC;
 
(vii)
LMT-SPE shall have delivered to Apple a security agreement in the form of Annex 11;
 
(viii)
Apple, LMT, LMC and LMT-SPE shall have jointly engaged patent counsel satisfactory to Apple to represent LMT and its affiliates in connection with its patent applications and prosecutions;
 
(ix)
Apple shall have received from LMT, LMC and LMT-SPE such farther agreements and instruments as Apple reasonably determines are required to give effect to the agreements and transactions contemplated between the parties;
 
(x)
Apple shall have concluded its discussions with Caltech concerning the Caltech License, and with results satisfactory to Apple;
 
(xi)
Apple shall have completed all legal, tax, accounting, engineering and confirmatory business due diligence on the LMT Technology, LMT, LMC and LMT-SPE, and with results satisfactory to Apple; and
 
(xii)
Apple shall not be entitled under Section 14(b) to terminate this Agreement.
 
(e)
The parties agree that the security interest granted to Apple under the security agreement described in Section 9(d)(vii) shall be:
 
(i)
subordinated to all of Apple's rights under the Apple License Agreement, such that in the event that such security interest shall be enforced in any of the collateral subject to such security interest any rights acquired as a result of such enforcement shall be subject to all of, and shall not entitle the acquirer of any such rights to interfere with or otherwise disturb, Apple's rights or its enjoyment of those rights under the Apple License Agreement;
 
(ii)
subordinated to all of LMC's rights under the LMC License Agreement, such that in the event that such security interest shall be enforced in any of the collateral subject to such security interest any rights acquired as a result of such enforcement shall be subject to all of, and shall not entitle the acquirer of any such rights to interfere with or otherwise disturb, LMC's rights or its enjoyment of those rights under the LMC License Agreement; and
 
(iii)
prior to all of LMT's rights under the LMT License Agreement, such that in the event that such security interest shall be enforced in any of the collateral subject to such security interest any rights acquired as a result of such enforcement shall be free and clear of LMT's right under the LMT License Agreement, and LMT's rights under the LMT License Agreement and, to the extent the rights acquired as a result of the enforcement of such security interest conflict with the LMT License Agreement, the LMT License Agreement shall continue to exist at the sole and absolute discretion of the acquirer of rights as a result of such enforcement.

 
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(f)
LMT, on behalf of itself and its respective heirs, executors, successors, assigns, agents and all other persons and entities associated with either of them, 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, assert, or participate in any claim or allegation against any of the following for infringement of Intellectual Property Rights of any of the LMT Technology: (i) Apple and any of its Subsidiaries; or (ii) their respective past, present and future owners, shareholders, parents, subsidiaries, successors, assigns, divisions, units, officers, directors, employees, agents, attorneys, or representatives, or (iii) their respective past, present and future direct and indirect vendors, suppliers, manufacturers, distributors, customers, or end users (collectively, "Apple-Related Entities") in connection with any act by a Apple-Related Entity at the direction of or on behalf of Apple related to or in connection with any Apple-branded or Apple-licensed product. This covenant not to sue does not inure to the benefit of any third parties for their conduct that is unrelated to Apple or any of its Subsidiaries, and this covenant not to sue shall not apply in any action in which Apple or any other Apple-Related Entity raises as a defense in an infringement action that LMT is a necessary party in any such action. For purposes of this paragraph, the grant to a third party of an exclusive license or sublicense to any Intellectual Property Rights relating to any LMT Technology in a field other than Consumer Electronic Products shall not be a violation of this paragraph, even if the third party is granted, as a part of such exclusive license, the right to sue or otherwise assert infringement claims with respect to such Intellectual Property Rights.
 
(g)
LMT, LMC and LMT-SPE shall not amend, modify, supplement, amend and restate or replace the LMT License Agreement or the LMC License Agreement except (i) with the prior written consent of Apple or (ii) for the addition to the schedules attached thereto of Intellectual Property Rights created or acquired during the Capture Period.
 
10.
Covenant Not to Compete.
 
(a)
LMT shall not, and shall ensure that its direct and indirect subsidiaries shall not, directly, or indirectly through or in association with any person, business enterprise or otherwise, (i) develop, design, manufacture, sell, offer for sale or otherwise distribute or provide any (x) Consumer Electronic Products or (y) materials, components, manufacturing services or technology for use or integration therewith; (ii) own or acquire any interest in, manage, operate, control or participate in any business which is engaged in any of the activities described in preceding subsection (i); or (iii) act as a consultant or advisor, loan or otherwise provide funds or assistance of any sort, or sell or license intellectual property to any business enterprise which is or is attempting to engage in any of the activities listed in subsection (i) or (ii) hereof.

 
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"Consumer Electronic Products" means 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 (in Apple's sole discretion) to an accessory made or sold by or on behalf of Apple (regardless of when Apple sold or started to sell such accessory, including after the Closing Date) 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, including after the Closing Date) 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, including after the Closing Date) or component of any Apple product and that are made solely for, and sold solely into, the defense/military, automotive, medical, or industrial markets.
 
(b)
The parties hereto acknowledge and agree that the value to the parties of the transactions provided for in this Agreement would be substantially and materially diminished if either LMT directly or indirectly through or in association with any person or business enterprise or otherwise, were hereafter to breach any of the provisions of Section 10(a), and LMT has therefore offered and agreed to the provisions of Section 10(a) as a material inducement to Apple to enter into this Agreement, and in consideration of the promises, representations and covenants made by Apple under this Agreement. LMT specifically acknowledges and agrees that the provisions of Section 10(a) are commercially reasonable restraints on it and are reasonably necessary to protect the interests Apple is acquiring hereunder and under the Transaction Documents. The parties hereto further acknowledge and agree that Apple would be irreparably damaged by a breach of Section 10(a) and would not be adequately compensated by monetary damages for any such breach. Therefore, in addition to all other remedies, Apple shall be entitled to injunctive relief from any court having jurisdiction to restrain any violation (actual or threatened) of Section 10(a) without the necessity of (i) proving monetary damages or the insufficiency thereof, or (ii) posting any bond in regard to any injunctive proceeding. Notwithstanding anything in this Agreement to the contrary, the rights and licenses granted under the License Agreement, dated March 10, 2009, between LMT and The Swatch Group Ltd., shall not constitute a violation of Section 10(a) hereof or of any other provision of the MTA or any Transaction Document, but only to the extent that such License Agreement is not amended after the date hereof to include any new provision that would violate Section 10(a).

 
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(c)
If any court shall in any proceeding refuse to enforce Section 10(a) in whole or in part because the time limit, geographical scope or any other element thereof is deemed unreasonable in the jurisdiction of that court, it is expressly understood and agreed that Section 10(a) shall not be void but, for the purpose of such proceeding, such time limit, geographical scope or other element shall be deemed to be reduced to the extent necessary to permit the enforcement of Section 10(a) to the maximum extent allowable in that particular jurisdiction. The foregoing, however, is not intended to and shall not in any way affect, invalidate or limit the remaining provisions of Section 10(a) or affect, invalidate or limit the validity or enforceability of Section 10(a) as written in any other jurisdiction at any time.
 
(d)
From time to time, LMT or LMC may request that Apple grant express written permission to develop, design, manufacture, sell, offer for sale or otherwise distribute or provide any accessory for a Consumer Electronic Product or materials, components, manufacturing services or technology for use or integration therewith. Such requests shall be submitted in writing to Apple's Senior Director of Legal Affairs for Hardware Products, and shall specify in reasonable detail the contemplated activity for which Apple's consent is being sought. Apple shall respond within a reasonable period of time, and Apple shall consider each such request in good faith taking into account both the business opportunity to LMT or LMC, as well as any actual or potential impact to Apple's current or future business opportunities.
 
11.
Confidentiality. The disclosure and use of all confidential information pursuant to this Agreement and the other Transaction Documents shall be subject to the terms of the parties' existing Confidentiality Agreement and Exclusivity Agreement, both dated April 30, 2010, the terms of which are incorporated by reference herein. Without limiting the generality of the foregoing, LMT shall ensure that neither LMT nor any Affiliate of LMT shall orally or in writing refer to Apple or any Affiliate of Apple in any press conference, publication, press release, filing, registration, notice or other communication without providing Apple at least three (3) business days' prior notice and a copy of each such proposed reference, allowing Apple an opportunity to review and comment on the same, and making any changes in each such proposed reference as requested by Apple, unless the failure by LMT to make such changes would result in LMT's failing to comply with applicable law.

 
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12.
Independent Contractor.
 
(a)
Each of LMT, LMC and LMT-SPE shall at all times be an independent contractor under the Transaction Documents and not an employee or agent of Apple. None of LMT, LMC and LMT-SPE shall have authority to obligate Apple in any manner whatsoever and shall not make any representations or statements for or about Apple or any Apple products or services.
 
(b)
Each of LMT, LMC and LMT-SPE shall have full responsibility for all applicable withholding taxes for all compensation paid to it and for compliance with all applicable labor and employment requirements with respect to its employees, including, without limitation, state worker's compensation insurance coverage requirements and any immigration or visa requirements. Each of LMT, LMC and LMT-SPE agrees to indemnify, defend and hold Apple harmless from any liability for, or assessment of, any claims or penalties with respect to such withholding taxes, labor, employment or immigration requirements, including, without limitation, any liability for, or assessment of, withholding taxes imposed on Apple by the relevant taxing authorities with respect to any compensation paid to it or its employees.
 
13.
Indemnification.
 
(a)
LMT shall defend, indemnify and hold Apple (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 attorneys' 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 LMT, LMC or LMT-SPE in any Transaction Document or (B) any act or omission by any of LMT, LMC or LMT-SPE 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, any other Transaction Document, the performance by the parties hereto or thereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby, (B) Apple's use of the LMT Technology or rights under the license agreement with LMT-SPE, or (C) LMT's performance of the services provided pursuant to the technology development agreement executed and delivered pursuant to Section 9(d)(iv), except to the extent due directly to LMT's following instructions given to it by Apple in the "Statements of Work" in situations in which Company has complied with its obligations under section 1(f) of such thereof. In the event that a claimant obtains a final judgment against Apple expressly finding that Apple acted with gross negligence, in bad faith or that it engaged in willful misconduct, then this indemnity and hold harmless agreement shall not apply, but only to the extent of such claim.
 
(b)
If any party is entitled to indemnification under Section 13(a), Apple will give written notice to LMT of any matters giving rise to a claim for indemnification; provided that the failure of any party entitled to indemnification hereunder to give notice as provided herein shall not relieve the indemnifying party of its obligations under this Section 13 except to the extent that the indemnifying party is actually prejudiced by such failure to give notice.
 
 
24

 
 
CONFIDENTIAL
 
(c)
In case any action, proceeding or claim is brought against an indemnified party in respect of which indemnification is sought hereunder, LMT 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 LMT 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 LMT fails, within thirty (30) days of receipt of any indemnification notice to notify, in writing, such person of its 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 LMT elects in writing to assume and does so assume the defense of any such claim, 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 LMT in connection with any negotiation or defense of any such action or claim by the indemnifying party and shall furnish to LMT all information reasonably available to the indemnified party which relates to such action or claim. LMT 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 LMT elects to defend any such action or claim, then the indemnified party shall be entitled to participate in such defense with counsel of its choice at its sole cost and expense. LMT shall not be liable for any settlement of any action, claim or proceeding effected without its prior written consent. Notwithstanding anything in this Section 13 to the contrary, LMT 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.
 
(d)
The indemnification required by this Section 13 shall be made by periodic payments of the amount thereof during the course of investigation or defense, as and when bills are received or expense, 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 LMT or others, and (ii) any liabilities LMT may be subject to pursuant to the law.
 
14.
Term, Termination and Suspension of Performance.
 
(a)
The term of this Agreement shall commence on the date hereof and shall continue until terminated pursuant to Section 14(b).

 
25

 
 
CONFIDENTIAL
 
(b)
Prior to the Closing Date (if different from the date of this Agreement), this Agreement may only be terminated as provided in this Section 14(b):
 
(i)
Apple or LMT may terminate this Agreement by notice to the other party if, in the case of Apple, LMT, LMC or LMT-SPE is in material breach, and in the case of LMT, Apple is in material breach of this Agreement or any other Transaction Document unless the defaulting party cures such breach and all effects thereof within five (5) days of its receipt of notice thereof from the non-defaulting party.
 
(ii)
Apple may terminate this Agreement by notice to LMT if Apple has reasonably determined that the conditions set forth in Section 9(d) are unlikely to be satisfied on or before August 31, 2010.
 
(c)
Termination of this Agreement by Apple pursuant to Section 14(b) shall not relieve LMT, LMC and LMT-SPE of their liabilities or obligations to Apple incurred prior to such termination.
 
(d)
The non-defaulting parties shall be entitled to exercise all remedies available at law and in equity, in addition to the remedies set forth in this Agreement and the other Transaction Documents, for a breach by any party of this Agreement or another Transaction Document.
 
(e)
LMT acknowledges and agrees that Apple will be unable to quantify all direct, indirect, consequential and special damages which Apple may incur as a result of (i) any breach by LMT of Section 1(b), 1(c), 2(b) or 8 of this Agreement or (ii) any breach of Section 1(d), 4(c), 4(f), 4(h), 8(g), 8(h), 9(f), 10, 11 or 13 of this Agreement, provided that if a breach in this clause (ii) is capable of cure and LMT has promptly initiated actions to cure such breach and has vigorously and continuously undertaken to cure such breach, such breach shall not have been cured within thirty (30) days of LMT learning thereof and, in the case of a breach listed in clause (i) or (ii), such breach could reasonably be expected to have a material adverse effect on Apple's rights under the Apple License Agreement (any such breach being a "LMT Fundamental Breach").
 
(f)
LMT-SPE acknowledges and agrees that Apple will be unable to quantify all direct, indirect, consequential and special damages which Apple may incur as a result of (i) any breach by LMT-SPE of Section 3(b) of this Agreement or (ii) any breach of Section 5(a), 5(c), 5(d) or 6 of this Agreement or Section 4.3 of the Apple License Agreement, provided that if a breach in this clause (ii) is capable of cure and LMT has promptly initiated actions to cure such breach and has vigorously and continuously undertaken to cure such breach, such breach shall not have been cured within thirty (30) days of LMT learning thereof and, in the case of a breach listed in clause (i) or (ii), such breach could reasonably be expected to have a material adverse effect on Apple's rights under the Apple License Agreement (any such breach being a "LMT-SPE Fundamental Breach").

 
26

 
 
CONFIDENTIAL
 
(g)
LMT and LMT-SPE each agrees that the minimum amount of any such damages to which Apple shall be entitled, in the case of LMT upon the occurrence of a LMT Fundamental Breach and, in the case of LMT-SPE, upon the occurrence of a LMT-SPE Fundamental Breach shall be all amounts paid by Apple to or on behalf of LMT, LMC and LMT-SPE pursuant to all Transaction Documents plus interest thereon from the date of such payment until the date on which Apple recovers payment in full of from the defaulting LMT party all damages hereunder and under the other Transaction Documents at a rate per annum equal to the greater of (i) 10% or (ii) "prime rate" as reported in The Wall Street Journal in effect from time to time plus two percent. Apple may prove the minimum amount of damages set forth in this Section 14(f) by entering this Agreement into evidence in any action brought under this Agreement or the other Transaction Documents or in connection with the exercise of its rights under the security agreements delivered pursuant to Section 9(d)(vi) and (vii).
 
15.
Guaranty.
 
(a)
LMT does hereby unconditionally guarantee to Apple and its assigns the prompt, full, and faithful performance and discharge by LMC and LMT-SPE ("LMT-Subs") of each and every one of the terms, conditions, agreements, representation, warranties, guarantees and provisions on the part of the LMT-Subs contained in this Agreement and the other Transaction Documents.
 
(b)
The guaranty in this Section 15 ("Guaranty") shall in all respects be a continuing, absolute, unconditional and irrevocable guaranty of payment and performance, and shall remain in full force and effect until all of the underlying obligations have been absolutely, irrevocably, and unconditionally fulfilled, performed or met, whether by LMT, or other person. LMT guarantees that the LMT-Subs' obligations under the Transaction Documents will be paid and performed strictly in accordance with the terms hereof and thereof, regardless of any law, regulation or order now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of the Apple.
 
(c)
LMT irrevocably waives the following, to the extent permitted by applicable law:
 
(i)
notice of any changes, amendments or modifications to (x) any agreements between Apple and the LMT-Subs, including, but not limited to, any Transaction Document or to (y) any liabilities owing Apple by either LMT-Sub;
 
(ii)
notice of presentment, demand, default, nonpayment or partial payments, protest, and all other notices or formalities to which an LMT-Sub might otherwise be entitled;
 
(iii)
notice of prosecution of collection or remedies against an LMT-Sub or against the makers, endorsers, or other person liable on any such receivables, or against any security or collateral thereto appertaining;

 
27

 
 
CONFIDENTIAL
 
 
(iv)
notice of any contents to the granting of indulgence or extension of time payment, the taking and releasing indebtedness or liabilities so guaranteed hereunder, or Apple's acceptance of partial payments thereon, or the settling, compromising or compounding in any of the same in such manner and at such times as Apple may deem advisable, without in any way impairing or affecting LMT's liability for the full amount thereof;

 
(v)
any requirement that Apple prosecute collection enforcement or other remedies against either LMT-Sub or against any person liable on any such agreements, obligation, indebtedness or liabilities so guaranteed, or enforce or resort to any security liens, collateral, or other rights or remedies thereto appertaining, before calling on LMT for payment; nor shall LMT's liability in any way be released or affected by reason of any failure or delay on Apple's part so to do;

 
(vi)
any requirement that suit be first instituted against an LMT-Sub, that any rights or remedies against an LMT-Sub be first exhausted or that an LMT-Sub be joined in any action brought by Apple against LMT under this Guaranty before calling on LMT for payment;

 
(vii)
any requirement that Apple inquire into the powers of either LMT-Sub, its officers, directors or agents, acting or purporting to act on such LMT-Sub's behalf with respect to the obligations described in this Guaranty; any such obligations created in reliance upon the professed exercise of such powers shall be guaranteed hereunder;

 
(viii)
any claims and other rights that it now has or may hereafter acquire against a either LMT-Sub or any other guarantor that arise from the existence, payment, performance or enforcement of LMT's obligations under this Guaranty, including any right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to participate in any claim or remedy of Apple against an LMT-Sub, any other guarantor or any collateral that Apple now has or hereafter acquires for the obligations underlying this Guaranty, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including the right to take or receive from an LMT-Sub, directly or indirectly, in cash or other property, by setoff or in any other manner, payment or security on account of any such claim or other right;

 
(ix)
any rights and defenses of LMT under Section 580a of the California Code of Civil Procedure and any other rights and defenses that LMT may have by reason of protection afforded to an LMT-Sub pursuant to the antideficiency or other laws of California limiting or discharging an LMT-Sub's obligations, including 580a, 580b, 580d and 726 of the California Code of Civil Procedure; and

 
(x)
without limiting the generality of the foregoing or any other provision hereof, any rights and benefits that might otherwise be available to LMT under California Civil Code Section 2809, 2810, 2815, 2819, 2839, 2845, 2848, 2849, 2850, 2899 or 3433.
 
 
28

 
 
CONFIDENTIAL
 
16.
Miscellaneous.

 
(a)
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 or on the third business day following mailing.

 
(b)
None of LMT, LMC or LMT-SPE shall assign, transfer, subcontract or otherwise delegate any of its obligations under this Agreement without Apple'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 their 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.

 
(c)
Each LMT, LMC and LMT-SPE acknowledges that any breach of this Agreement by it may cause irreparable harm to Apple or its affiliates and that the remedies for breach may include injunctive relief against such breach, in addition to damages and other available remedies. The prevailing party shall be entitled to the award of its reasonable attorneys' fees in any action to enforce this Agreement.

 
(d)
This Agreement, including the other Transaction Documents and the Nondisclosure Agreement 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.

 
(e)
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 both parties, and no oral amendment shall be binding on the parties.

 
(f)
This Agreement shall be governed by and construed in accordance with the laws of the State of California without giving effect to any conflict of laws principles to the contrary. The parties hereby consent to jurisdiction and venue in the appropriate state and Federal courts sitting in the Northern District of California in any litigation between them arising out of this Agreement. If any provision of this Agreement is held to be invalid or unenforceable to any extent in any context, it shall nevertheless be enforced to the fullest extent allowed by law in that and other contexts, and the validity and force of the remainder of this Agreement shall not be affected thereby.

 
29

 
 
CONFIDENTIAL
 
 
(g)
The invalidity of any provision in this Agreement shall not affect the validity of any other provision herein.

 
(h)
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.

 
(i)
In the event of a dispute, either party may commence litigation in the state or federal courts in Santa Clara County, California. The parties irrevocably submit to the exclusive jurisdiction of those courts and agree that final judgment in any action or proceeding brought in such courts will be conclusive and may be enforced in any other jurisdiction upon final and conclusive judgment (a certified copy of which will be conclusive evidence of the judgment) or in any other manner provided by law. Each party irrevocably waives to the fullest extent permitted by applicable law (i) any objection it may have to the laying of venue in any court referred to above; (ii) any claim that any such action or proceeding has been brought in an inconvenient forum; and (iii) any immunity that it or its assets may have from any suit, execution, attachment (whether provisional or final, in aid of execution, before judgment or otherwise) or other legal process.

(j)
Neither Apple nor any of LMT, LMC or LMT-SPE will issue press releases or other publicity regarding this Agreement or its subject matter without the prior written approval of the other parties.

[signatures follow]

 
30

 
 
CONFIDENTIAL
 
IN WITNESS WHEREOF, the parties have executed this Master Transaction Agreement as of the date first shown above. Each of the persons signing this Agreement affirms that he or she 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.

APPLE INC.
LIQUIDMETAL TECHNOLOGIES,
INC.
   
 
/s/ Larry Buffington
Name:
/s/ Zadesky
Name:
LARRY BUFFINGTON
Title:
VP Product Design
Title:
PRESIDENT/CEO
Date:
8/5/10
Date:
8/10/2010
     
Address:
1 Infinite Loop
Address:
30452 Esperanza
 
Cupertino, CA 95014
 
Rancho Santa Margarita, CA
Attn:
92688
 
Attn:
   
 
LIQUIDMETAL COATINGS, LLC
   
 
/s/ Larry Buffington
 
Name:
LARRY BUFFINGTON
 
Title:
PRESIDENT/CEO
 
Date:
8/10/2010
   
 
Address:
900 Rockmead Drive, Suite 240
   
Kingwood, Texas 77339
 
Attn:
Chief Executive Officer
   
 
CRUCIBLE INTELLECTUAL
PROPERTY, LLC
   
 
/s/ Tony Chung
 
Name:
Tony Chung
 
Title:
Chief Financial Officer
 
Date:
8/4/10
     
 
Address: 31441 Santa Margarita
Pkwy., Suite A #247
 
Rancho Santa Margarita, CA 92688 92688
   
 
Attn:
Chief Executive Officer
 
 
31

 

ANNEX 1

Permitted Liens

None

 

 

ANNEX 2

Approvals

Consents/approvals are required from the following parties:

1.
Enterprise Bank
2.
C3 Capital Partners, L.P.
3.
C3 Capital Partners II, L.P.
4.
Members and Board of Managers of LMC
5.
Board of Directors of LMT
6.
LLPG, Inc.

 

 

ANNEX 3

LMC Assignment Agreement

 

 

ASSIGNMENT AND ASSUMPTION AGREEMENT

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (the "Assignment") is dated as of August 5, 2010 by and between LIQUIDMETAL COATINGS, LLC, a Delaware limited liability company ("Assignor"), and LIQUIDMETAL TECHNOLOGIES, INC., a Delaware corporation ("Assignee").

THIS ASSIGNMENT is made with reference to the following facts and circumstances:

A.    Assignor and Assignee have, together with Apple Inc., a California corporation, and Crucible Intellectual Property, LLC, a Delaware limited liability company ("Crucible"), entered into that certain Master Transaction Agreement dated August 5, 2010 ("MTA") pursuant to which Assignor has agreed to distribute to Assignee all its right, title and interest in and to the LMT Technology (as defined in the MTA), now existing or hereafter arising until the date falling eighteen (18) months after the Closing Date (as defined in the MTA).

B.     Assignee is willing to accept all of Assignor's right, title and interest in the LMT Technology.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Assignor and Assignee hereby agree as follows:

1.
Assignment. Assignor hereby transfers, conveys and assigns to Assignee, effective as of close of business on August 5, 2010 (the "Effective Date"), all of Assignor's right, title and interest in, and obligations under the LMT Technology, whether now existing or hereafter arising until the date falling eighteen (18) months after the Effective Date (the "LMC Intellectual Property Assets"), including without limitation the patent applications listed on Schedule 1 hereto. Also effective as of the Effective Date, Assignee accepts this assignment of the LMC Intellectual Property Assets. Assignor hereby assigns, and Assignee hereby assumes, all (i) obligations under agreements included in the LMC Intellectual Property Assets and (ii) obligations arising as a matter of law with respect to the LMC Intellectual Property Assets. The assignment set forth herein shall not include the assignment of any rights of Assignor that Assignor acquires on or after the Effective Date under and with respect to: (i) the Exclusive License Agreement, dated as of the Effective Date, between Assignor and Crucible, or (ii) the Amended and Restated and Restated License and Technical Support Agreement, dated as of the Effective Date, between Assignor and Assignee.

2.
No Assignment. This Assignment may not be assigned by any party without the written consent of the other party (which consent may not be unreasonably withheld).

3.
Further Assurances. Each party to this Assignment shall execute and deliver to each other party all documents, and shall take all actions, reasonably required by such other party from time to time to confirm or effect the matters set forth in this Assignment, or otherwise to carry out the purposes of this Assignment.

 

 

4.
Entire Agreement. This Assignment, together with the MTA, constitute the entire agreement between the parties with respect to the assignment of the LMT Technology to Assignee.

5.
Successors and Assigns. This Assignment shall bind, and shall inure to the benefit of, the successors and assigns of the parties hereto.

6.
Counterparts. This Assignment may be executed in counterparts with the same effect as if the parties had executed one instrument, and each such counterpart shall constitute an original of this Assignment.

7.
Severability. No provision of this Assignment that is held to be inoperative, unenforceable or invalid shall affect the remaining provisions, and to this end all provisions of this Assignment shall be severable.

8.
Governing Law. This Assignment shall be governed by and construed in accordance with the laws of the State of California without giving effect to any conflict of laws principles to the contrary. The parties hereby consent to jurisdiction and venue in the appropriate state and Federal courts sitting in the Northern District of California in any litigation between them arising out of this Assignment. If any provision of this Assignment is held to be invalid or unenforceable to any extent in any context, it shall nevertheless be enforced to the fullest extent allowed by law in that and other contexts, and the validity and force of the remainder of this Assignment shall not be affected thereby.

9.
Jurisdiction. In the event of a dispute, either party may commence litigation in the state or federal courts in Santa Clara County, California. The parties irrevocably submit to the exclusive jurisdiction of those courts and agree that final judgment in any action or proceeding brought in such courts will be conclusive and may be enforced in any other jurisdiction upon final and conclusive judgment (a certified copy of which will be conclusive evidence of the judgment) or in any other manner provided by law. Each party irrevocably waives to the fullest extent permitted by applicable law (i) any objection it may have to the laying of venue in any court referred to above; (ii) any claim that any such action or proceeding has been brought in an inconvenient forum; and (iii) any immunity that it or its assets may have from any suit, execution, attachment (whether provisional or final, in aid of execution, before judgment or otherwise) or other legal process.

10.
Notices. All notices from one party to the other required or permitted under this Assignment shall be in writing, shall refer specifically to this Assignment, 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 to the MTA (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 or on the third business day following mailing.

[signatures follow]

 

 

NOW, THEREFORE, the parties have executed this Assignment as of the date first written above.

 
ASSIGNOR:
 
LIQUIDMETAL COATINGS, LLC
   
 
By:
/s/ Larry Buffington
 
Name:  
LARRY BUFFINGTON
 
Title:
PRESIDENT / CEO
   
 
ASSIGNEE:
 
LIQUIDMETAL TECHNOLOGIES, INC.
   
 
By:
/s/ Tony Chung
 
Name:
Tony Chung
 
Title:
Chief Financial Officer
 
 

 

SCHEDULE 1 TO ASSIGNMENT

Patents and Patent Applications

Grantor
Patent
Country
Date Filed
Serial No.
Patent
No./Status
Issue
Date
Liquidmetal
Coatings, LLC
Nickel Based
Thermal Spray
Powder
USA
2/1/10
61,300,318
Pending
Liquidmetal
Coatings, LLC
Molybdenum-
Containing
Ferrous Alloy for
Improved
Thermal Spray
Deposition and
Hard-Facing
USA
4/28/10
61,315,661
Pending
 
 

 

ANNEX 4

LMT Contribution Agreement

 

 

CONTRIBUTION AGREEMENT

THIS CONTRIBUTION AGREEMENT (the "Agreement") is dated as of August 5, 2010 (the "Effective Date") by and between LIQUIDMETAL TECHNOLOGIES, INC., a Delaware corporation ("Assignor"), and CRUCIBLE INTELLECTUAL PROPERTY, LLC., a Delaware limited liability company and wholly owned subsidiary of Assignor ("Assignee").

THIS AGREEMENT is made with reference to the following facts and circumstances:

A.   Assignor and Assignee are, with Apple Inc., Assignee, and Liquidmetal Coatings, LLC, parties to that certain Master Transaction Agreement, dated as of the Effective Date ("MTA"), pursuant to which Assignor has agreed to contribute to Assignee all its right, title and interest in and to the LMT Technology (as defined in the MTA) now existing or hereafter arising until the date falling eighteen (18) months after the Effective Date, including, without limitation, all trade secrets and all patent registrations, patent applications, license agreements, copyright applications and copyright registrations listed on Schedule 1 hereto.

B.    Assignee is willing to accept all of Assignor's right, title and interest in the LMT Technology.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Assignor and Assignee hereby agree as follows:

1.
Assignment. Assignor hereby transfers, conveys and assigns to Assignee, effective as of the close of business on the Effective Date, all of Assignor's right, title and interest in the LMT Technology, now existing or hereafter arising until the date falling eighteen (18) months after the Effective Date, including, without limitation: all trade secrets and all patent registrations, patent applications, license agreements, and trademarks listed on Schedule 1 hereto. Also effective as of the Effective Date, Assignee accepts this assignment of the LMT Technology. In connection with the foregoing, Assignor hereby assigns and delegates, and Assignee hereby assumes, all (i) obligations under agreements included in the LMT Technology and (ii) obligations arising as a matter of law with respect to the LMT Technology. It is intended by the parties that the contribution of the LMT Technology being made by Assignor to Assignee hereunder will qualify as a tax-exempt transaction pursuant to Section 721 of the Internal Revenue Code of 1986, as amended.

2.
No Assignment. This Agreement may not be assigned by any party without the written consent of the other party (which consent may not be unreasonably withheld).

3.
Further Assurances. Each party to this Agreement shall execute and deliver to each other party all documents, and shall take all actions, reasonably required by such other party from time to time to confirm or effect the matters set forth in this Agreement, or otherwise to carry out the purposes of this Agreement.

 

 

4.
Entire Agreement. This Agreement, together with the MTA, constitute the entire agreement between the parties with respect to the assignment of the LMT Technology to Assignee.

5.
Successors and Assigns. This Agreement shall bind, and shall inure to the benefit of, the successors and assigns of the parties hereto.

6.
Counterparts. This Agreement may be executed in counterparts with the same effect as if the parties had executed one instrument, and each such counterpart shall constitute an original of this Agreement.

7.
Severability. No provision of this Agreement that is held to be inoperative, unenforceable or invalid shall affect the remaining provisions, and to this end all provisions of this Agreement shall be severable.

8.
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California without giving effect to any conflict of laws principles to the contrary. The parties hereby consent to jurisdiction and venue in the appropriate state and Federal courts sitting in the Northern District of California in any litigation between them arising out of this Agreement. If any provision of this Agreement is held to be invalid or unenforceable to any extent in any context, it shall nevertheless be enforced to the fullest extent allowed by law in that and other contexts, and the validity and force of the remainder of this Agreement shall not be affected thereby.

9.
Jurisdiction. In the event of a dispute, either party may commence litigation in the state or federal courts in Santa Clara County, California. The parties irrevocably submit to the exclusive jurisdiction of those courts and agree that final judgment in any action or proceeding brought in such courts will be conclusive and may be enforced in any other jurisdiction upon final and conclusive judgment (a certified copy of which will be conclusive evidence of the judgment) or in any other manner provided by law. Each party irrevocably waives to the fullest extent permitted by applicable law (i) any objection it may have to the laying of venue in any court referred to above; (ii) any claim that any such action or proceeding has been brought in an inconvenient forum; and (iii) any immunity that it or its assets may have from any suit, execution, attachment (whether provisional or final, in aid of execution, before judgment or otherwise) or other legal process.

10.
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 to the MTA (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 or on the third business day following mailing.

[signatures follow]

 
2

 

NOW, THEREFORE, the parties have executed this Contribution Agreement as of the date first written above.

 
ASSIGNOR:
 
LIQUIDMETAL TECHNOLOGIES, INC.
     
 
By:
/s/ Larry Buffington
 
Name:  
LARRY BUFFINGTON
 
Title:
PRESIDENT / CEO
     
 
ASSIGNEE:
 
CRUCIBLE INTELLECTUAL PROPERTY, LLC
     
 
By:
/s/ Tony Chung
 
Name:
Tony Chung
 
Title:
Chief Financial Officer
 
 
3

 

SCHEDULE 1 TO AGREEMENT

Patents and Patent Applications

Patent
Country
Date
Filed
Serial No.
Patent
No./Status
Issue
Date
Porous Amorphous Alloy for Catalysts
USA
09.10.84
06/649,070
4'608'319
08.26.86
Data Storage Using Amorphous Metallic Storage Medium
USA
11.23.87
07/123,924
4'888'758
12.19.89
Joining Using Bulk Alloys
USA
06.13.94
08/258,766
5'482'580
01.09.96
Composites of Bulk Alloy (Method)
USA
04.06.95
08/417,749
5 567 251
10.22.96
Diamond Composites of Bulk Alloys
USA
08.01.94
08/284,153
5'567'532
10.22.96
Die-Casting of Bulk Alloys
USA
02.16.96
08/602,899
5'711'363
01.27.98
Torsional Spring of Bulk Alloys
USA
08.26.96
08/702,918
5'772'803
06.30.98
Casting of Zr-base Bulk Alloys
USA
09.30.96
08/720,483
5'797'443
08.25.98
Composites of Bulk Alloys
USA
10.15.96
08/732,546
5'866'254
02.02.99
Die-Forming (Molding) of Bulk Alloys
USA
07.17.96
08/683,319
5'896'642
04.27.99
Replication with Bulk Alloys
USA
07.18.96
08/683,320
5'950'704
09.14.99
Composite Kinetic Energy Penetrator
USA
09.24.97
08/937,096
6'010'580
01.04.00
Vacuum Die-Casting
USA
01.23.98
09/012,347
6'021'840
02.08.00
Shaped-Charge Projectiles
USA
02.27.01
09/796,736
6'446'558
09.10.02
Yttrium Addition
USA
10.31.01
10/020,386
6'682'611
01.27.04
Golf Club Made of Bulk Alloy
USA
10.28.97
08/963,131
6'685'577
12.04.95
 
 
4

 

Patent
Country
Date
Filed
Serial No.
Patent
No./Status
Issue
Date
Metal Frame
USA
06.07.02
10/165,466
6'771'490
08.03.04
Metal Frame
UK
06.07.02
02787184.7
1404884
07.11.07
Metal Frame
Germany
06.07.02
60221127.1
60221127
07.11.07
Metal Frame
China
06.07.02
028138414
ZL02813841.4
03.01.06
Metal Frame
Korea
06.07.02
2003-
7016092
10-0908420
07.13.09
Metal Frame
India
06.07.02
2091DELNP 2003
Filed
Joining by Casting
USA
07.31.02
10/210,398
6'818'078
11.16.04
Joining by Casting
UK
07.31.02
02761216.7
1415010
01.07.09
Joining by Casting
Germany
07.31.02
02761216.7
60230769.4
01.07.09
Joining by Casting
Italy
07.31.02
48253BE200
9
1415010
01.07.09
Joining by Casting
Japan
07.31.02
2003-
517329
4243589
12.19.08
Joining by Casting
Korea
07.31.02
2004-
7001265
0898657
05.13.09
Gliding Boards
USA
03.07.02
10/093,229
6'843'496
01.18.05
Gliding Boards
Japan
03.07.02
2002-
570783
4216604
11.14.08
Gliding Boards
EPO
03.07.02
0270796722
122
Filed
Forming Molded Articles
USA
09.06.02
10/236,792
6'875'293
04.05.05
Forming Molded Articles
China
09.06.02
028198131
ZL02819813.1
01.17.07
Forming Molded Articles
EPO
09.06.02
027802842
Filed
Forming Molded Articles
Japan
09.06.02
2003527141
Filed
Forming Molded Articles
Korea
09.06.02
2004700338
8
Filed
Cutting Tools
USA
03.07.02
10/093,245
6'887'586
05.03.05
Cutting Tools
Japan
03.03,09
2009-
049448
Filed
 
 
5

 

Patent
Country
Date
Filed
Serial No.
Patent
No./Status
Issue
Date
Cutting Tools
China
03.07.02
028080815
ZL02808081.5
04.23.08
Cutting Tools
Korea
03.07.02
2003-
7011684
100874694
12.11.08
Improving Bulk Alloys
USA
10.02.02
10/263,965
7'008'490
03.07.06
Improving Bulk Alloys
Japan
10.02.02
2003532717
Filed
Improving Bulk Alloys
Korea
10.02.02
2004700498
8
Filed
Improving Bulk Alloys
China
10.02.02
0282185915
Filed
Thermoplastic Casting (TPC)
USA
01.31.03
10/355,490
7'017'645
03.28.06
Thermoplastic Casting (TPC)
EPO
01.31.03
0373510951
215
EP1499461
09.02.09
Thermoplastic Casting (TPC)
UK
01.31.03
03735109,5
1215
Filed
Thermoplastic Casting (TPC)
Germany
01.31.03
03735109.5-
1215
Filed
Thermoplastic Casting (TPC)
France
01.31.03
03735109.5-
1215
Filed
Thermoplastic Casting (TPC)
China
01.31.03
038043971
ZL03804397.1
11.02.07
Thermoplastic Casting (TPC)
Japan
01.31.03
20106769
Filed
Thermoplastic Casting (TPC)
Korea
01.31.03
2004701190
0
Filed
Foamed Structures
USA
05.20.03
10/442,707
7'073'560
07.11.06
Foamed Structures
UK
05.20.03
03729048.3
2122
1513637
05.12.08
Foamed Structures
Germany
05.20.03
037290483
60319700.0-.08
03.12.08
Foamed Structures
Korea
05.20.03
2004701877
3
Filed
Encapsulated Ceramic Armor
USA
03.11.03
10/386,728
7,157,158
01.02.07
 
 
6

 
 
Patent
Country
Date
Filed
Serial No.
Patent
No./Status
Issue
Date
Investment Casting of Bulk-Solidifying Amorphous Alloys
USA
09.30.03
10/529,585
7'293'599
11.13.07
Retractable Memory Stick
USA
08.21.06
29/264,947
D563,954
03.11.08
Golf Club Made of Bulk-Solidifying Amorphous Metal
USA
11.25.05
11/288,492
7'357'731
04.15.08
Jewelry Made of Precious Amorphous Alloys and Method of Making Such
USA
10.05.05
10/534,375
7,412,848
08/19/08
Amorphous Alloy Stents
USA
11.18.03
10/534,374
7,500,987
03/10/09
Method of Making In-Situ Composites Comprising Amorphous Alloys
USA
02.11.04
10/545,123
7,520,944
03/21/09
Method of Making Dense Composites of Bulk-Solidifying Alloys and Articles Thereof
USA
06.17.03
10/521,424
7,560,001
7/14/2009
Continuous Casting of Bulk Solidifying Amorphous Alloys
USA
04.14.04
10/552,667
7,575,040
8/18/2009
Pt-Base Bulk Solidifying Amorphous Alloys
USA
12.22.03
10/540,337
7,582,172
9/1/2009
Continuous Casting of Foamed Bulk Amorphous Alloys
USA
04.14.04
10/552,496
7,588,071
9/15/2009
Continuous Casting of Foamed Bulk Amorphous Alloys
Korea
04.14.04
2005-
7019638
Filed
Encapsulated Ceramic Armour
USA
12.18.06
11/612,328
7,604,876
10/20/2009
Method of Manufacturing Amorphous Metallic Foam
USA
01.20.04
10/542,438
7,621,314
11/24/2009
Fe-Base In-Situ Composite Alloys Comprising Amorphous Phase
USA
10.01.04
10/573,148
7,618,499
11/17/2009
 
 
7

 

Patent
Country
Date
Filed
Serial No.
Patent
No./Status
Issue
Date
Antenna Structures Made of Bulk-Solidifying Amorphous Alloys
USA
02.17.06
11,844431
Filed
Antenna Structures Made of Bulk
UK
02.17.06
07171812
2439852
06/10/2009
Antenna Structures Made of Bulk
China
02.17.06
2006-
800088016
Filed
Antenna Structures Made of Bulk
India
02.17.06
6490DELM
P2007
Filed
Bulk-Solidifying Alloys with Improved Mechanical Properties
USA
12.16.05
11,303,844
Filed
High Durability Structures of Amorphous Alloy with a Method of Forming
USA
08.13.04
10,565,839
Filed
Medical Implants
USA
08.19.03
10,524,954
Filed
Medical Implants
EPO
08.19.03
03788672.8
Filed
Metallic Dental Prostheses Made of Bulk-Solidifying Amorphous Alloys and Articles Thereof
USA
08.05.03
10,523,465
Filed
Au-Base Bulk Solidifying Amorphous Alloys
USA
10.17.05
11,576,922
Filed
Au-Base Amorphous Alloys
EPO
10.17.05
05815431.1
1 805 337
05.05.10
Au-Base Amorphous Alloys
UK
10.17.05
05815431.1
Filed
Au-Base Amorphous Alloys
Germany
10.17.05
05815431.1
60-
2005021136.5
Au-Base Amorphous Alloys
France
10.17.05
05815431.1
Filed
Au-Base Amorphous Alloys
Switzerland
10.17.05
05815431.1
Filed
Au-Base Amorphous Alloys
Netherlands
10.17.05
05815431.1
Filed
Au-Base Amorphous Alloys
Austria
10.17.05
05815431.1
Filed
 
 
8

 
 
Patent
Country
Date
Filed
Serial No.
Patent
No./Status
Issue
Date
All-Base Amorphous Alloys
Spain
10.17.05
05815431.1
Filed
Au-Base Amorphous Alloys
Turkey
10.17.05
05815431.1
Filed
Current Collector Plates Made of Bulk-Solidifying Amorphous Alloys
USA
03.18.04
10,548,979
Filed
Current Collector Plates Made of Bulk-Solidifying Amorphous Alloys
Japan
10.18.04
2006-
507442
Filed
Amorphous Alloy Hooks and Methods of Making Such Hooks
USA
10.24.05
11,577,081
Filed
Metallic Mirrors Formed from Amorphous Alloys
USA
10.19.05
11,577,052
Filed
Tin-Addition to Amorphous Alloy
USA
06.12.09
61,354,620
Filed
Tin-Addition to Amorphous Alloy
Korea
07.23.09
200910-
2009-
0067226
Filed
Amorphous Alloy Armor
USA
11.09.09
12,615,097
Filed
Hermetic Seal
USA
01.04.10
61,335,294
Filed
Nickel Based Thermal Spray Powder Imprint Lithograph with Amorphous Metallic Materials
USA
02.01.10
61,300,381
Filed
Thermoplastic Forming Methods for Amorphous Alloys
USA
02.17.10
61,338,138
Filed
Ni-Free Beryllium Containing Amorphous Alloy
USA
04.28.10
61,329,054
Filed
Molybdenum-Containing Ferrous Alloy for Improved Thermal Spray Deposition and Hard Facing
USA
03.19.10
61,315,661
Filed
 
 
9

 

SCHEDULE 1 TO AGREEMENT (CONTINUED)

Trademarks and Trademark Applications

Ref No.
Mark/ Title
App. No./
Filing Date
Reg No./
Issue Date
Status
Inventors/Goods
U.S./
Foreign
LQUID-002T
LIQUIDMETAL (and design)
75/389,648
11/13/1997
2,435,529
03/13/2001
REGISTERED
RENEWAL DUE
03/13/2011
CLASS 028: GOLF EQUIPMENT, NAMELY, GOLF CLUBS, GOLF BALLS AND GOLF BAGS
U
LQUID-003T
LIQUIDMETAL (stylized)
75/389,645
11/13/1997
2,480,241
08/21/2001
REGISTERED
RENEWAL DUE
08/21/2011
CLASS 028: GOLF EQUIPMENT, NAMELY, GOLF CLUBS, GOLF BALLS AND GOLF BAGS
U
LQUID-004T
LIQUIDMETAL (and design)
75/358,134
09/16/1997
2,312,889
02/01/2000
REGISTERED
RENEWAL DUE
02/01/2020
CLASS 006: AMORPHOUS METALS
U
LQUID-005T
LIQUIDMETAL GOLF (and design)
75/351,059
09/03/1997
2,494,583
11/02/2001
REGISTERED
RENEWAL DUE
10/02/2011
CLASS 028: TOYS AND SPORTING GOODS, NAMELY, GOLF CLUBS, GOLF BALLS, GOLF CLUB SHAFTS, GOLF GRIPS, GOLF BAGS, TENNIS RACKETS
U
LQUID-008T
LIQUIDMETAL GOLF
75/498,778
06/08/98
2,714,787
05/13/2003
REGISTERED
RENEWAL DUE
05/13/2013
CLASS 025: CLOTHING, NAMELY, HATS, PANTS, SHIRTS, SHORTS, SWEATERS, JACKETS AND FOOTWEAR
U
LQUID-013JP (Japan)
LIQUIDMETAL (and design)
016900/1997
02/18/1997
4149191
05/22/1998
REGISTERED
RENEWAL DUE
05/22/2018
CLASS 006: AMORPHOUS METALS
F
LQUID-013KS (South Korea)
LIQUIDMETAL (and design)
97-57058
12/10/1997
447777
05/13/1999
REGISTERED
RENEWAL DUE
05/13/2019
CLASS 006: ZIRCONIUM AND TITANIUM BASED ALLOYS
F
LQUID-014HK2 (Hong Kong)
LIQUIDMETAL (and design)
793/2001
01/15/2001
B6279/2002
05/24/2002
REGISTERED
RENEWAL DUE
01/15/2018
CLASS 028: GAMES AND PLAYTHINGS, GYMNASTIC AND SPORTING ARTICLES
F
LQUID-014JP (Japan)
LIQUIDMETAL (and design)
147446/1997
08/07/1997
4496160
08/03/2001
REGISTERED
RENEWAL DUE
08/03/2011
CLASS 028: SPORTING, ATHLETIC AND GYMNASTIC IMPLEMENTS; GAME MACHINES AND APPARATUS; GO GAME EQUIPMENT (JAPANESE BOARD GAME); SHOGI GAME EQUIPMENT (JAPANESE CHESS); DICE; SUGOROKU GAMES (JAPANESE PARCHEESI); DICE CUPS; DIAMOND GAMES; CHESS GAMES; CHECKERS; CONJURING APPARATUS; DOMINOES; MAHJONG EQUIPMENT; BILLIARD APPARATUS; TOYS; DOLLS; TOYS FOR DOMESTIC PETS; WAX FOR SKIS; FISHING TACKLE
F
LQUID-014KS (South Korea)
LIQUIDMETAL (and design)
97-57059
12/10/1997
446249
04/14/1999
REGISTERED
RENEWAL DUE
04/14/2019
CLASS 028; GOLF CLUBS, GOLF BALLS AND GOLF BAGS
F
LQUID-014SG (Singapore)
LIQUIDMETAL (and design)
S115181/97
12/15/1997
T97/15181Z
12/15/1997
REGISTERED
RENEWAL DUE
12/15/2017
CLASS 028: SPORTING GOODS
F
 
 
10

 

LQUID-014TI (Taiwan)
LIQUIDMETAL (and design)
75/184,482
10/21/1996
854224
06/01/1999
REGISTERED
RENEWAL DUE
05/31/2019
CLASS 028: SPORTING GOODS, NAMELY BADMINTON RACKETS, GOLF CLUB HEADS, GOLF CLUB SHAFTS, GOLF CLUBS, GOLF CLUB FACE PLATE INSERTS, FIELD HOCKEY STICKS, ICE HOCKEY STICKS AND TENNIS RACKETS
F
LQUID-015AU (Australia)
LIQUIDMETAL (and design)
750504
12/08/1997
750504
02/11/2000
REGISTERED
RENEWAL DUE
12/08/2017
CLASS 028; SPORTING GOODS
F
LQUID-015CA (Canada)
LIQUIDMETAL (and design)
864571
12/18/1997
517,008
09/24/1999
REGISTERED
RENEWAL DUE
09/24/2014
CLASS 006: AMORPHOUS METALS CLASS 028: SPORTING GOODS, NAMELY GOLF CLUBS, GOLF BALLS AND GOLF BAGS
F
LQUID-015EU (Europe)
LIQUIDMETAL (and design)
698977
12/08/1997
000698977
09/01/1999
REGISTERED
RENEWAL DUE
12/08/2017
CLASS 006: AMORPHOUS METALS CLASS 028: SPORTING GOODS
F
LQUID-018JP (Japan)
LIQUIDMETAL (and design)
016901/1997
02/18/1997
4149192
05/22/1998
REGISTERED
RENEWAL DUE
05/22/2018
CLASS 006: AMORPHOUS METALS
F
LQUID-019JP (Japan)
LIQUIDMETAL GOLF (and design)
0167209/1997
10/13/1997
4314788
09/10/1999
REGISTERED
RENEWAL DUE
09/10/2019
CLASS 028: TOYS; SPORTING, ATHLETIC AND GYMNASTIC IMPLEMENTS
F
LQUID-020JP (Japan)
LIQUIDMETAL (shaded letters)
147447/1997
08/07/1997
4470501
04/27/2001
REGISTERED
RENEWAL DUE
04/27/2011
CLASS 028: SPORTING, ATHLETIC AND GYMNASTIC IMPLEMENTS; GAME MACHINES AND APPARATUS; GO GAME EQUIPMENT (JAPANESE BOARD GAME); SHOGI GAME EQUIPMENT (JAPANESE CHESS); DICE; SUGOROKU GAMES (JAPANESE PARCHEESI); DICE CUPS; DIAMOND GAMES; CHESS GAMES; CHECKERS; CONJURING APPARATUS; DOMINOES; MAHJONG EQUIPMENT; BILLIARD APPARATUS; TOYS; DOLLS; TOYS FOR DOMESTIC PETS; WAX FOR SKIS; FISHING TACKLE
F
LQUID-027T
LIQUIDMETAL
75/434,845
02/17/1998
2,435,558
03/13/2001
REGISTERED
RENEWAL DUE
03/13/2011
GLASS 028: GOLF PRODUCTS, NAMELY GOLF CLUBS, GOLF BALLS AND GOLF BAGS
U
LQUID-051U
LIQUIDMETAL
 
107559
08/03/2001
CA
REGISTERED
RENEWAL DUE
08/23/2011
GOLF EQUIPMENT; GOLF PRODUCTS; GOLF CLUBS; TOYS AND SPORTING GOODS
U
LQUID-057AU (Australia)
LIQUIDMETAL
946649
03/11/2003
946649
12/07/2006
REGISTERED
RENEWAL DUE
03/11/2013
CLASS 028: SPORTING GOODS, NAMELY TENNIS RACKETS, SKIS, SKI POLES AND SNOW BOARDS
F
LQUID-057CA (Canada)
LIQUIDMETAL
1,186,331
08/012003
666,056
06/14/2006
REGISTERED
RENEWAL DUE
06/14/2021
CLASS 006: AMORPHOUS METALS CLASS 025: WEARING APPAREL, NAMELY SHIRTS, T-SHIRTS, SHORTS, PANTS, SWEATSHIRTS, SWEATPANTS, HATS, VISORS, SHOES AND BELTS CLASS 028: SPORTING GOODS NAMELY SPORTING KNIVES, TENNIS RACKETS, TENNIS BAGS AND TENNIS CASES, GOLF CLUBS, GOLF BALLS AND GOLF BAGS
F
 
 
11

 

LQUID-057EU (Europe)
LIQUIDMETAL
003091501
03/11/2003
003091501
05/31/2005
REGISTERED
RENEWAL DUE
03/11/2013
CLASS 008: SPORTING KNIVES CLASS 025: WEARING APPAREL, INCLUDING SHIRTS, T-SHIRTS, SHORTS, PANTS, SWEATSHIRTS, SWEATPANTS, HATS, VISORS, SHOES AND BELTS CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS; AND MATERIALS USED IN SKIS, SKI POLES AND SNOW BOARDS
F
LQUID-057HK (Hong Kong)
LIQUIDMETAL
300057717
08/24/2004
 
REGISTERED
RENEWAL DUE
08/04/2013
CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS, SKIS, SKI POLES, SNOWBOARDS, TENNIS BAGS, TENNIS CASES, GOLF CLUBS, GOLF BALLS AND GOLF BAGS
F
LQUID-057HU (Hungary)
LIQUIDMETAL
M 03
03314
183038
12/13/2005
REGISTERED
RENEWAL DUE
08/05/2013
CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS, TENNIS BAGS, TENNIS CASES, SPORTING KNIVES, AND MATERIALS USED IN SKIS, SKI POLES AND SNOWBOARDS
F
LQUID-057PL (Poland)
LIQUIDMETAL
Z-268178
08/04/2003
176076
06/27/2006
REGISTERED
RENEWAL DUE
08/04/2013
CLASS 028: SPORTING GOODS, TENNIS RACKETS, SKIS, SKI POLES, SNOWBOARDS, SPORTING KNIVES, TENNIS BAGS, TENNIS CASES, GOLF CLUBS, GOLF BALLS AND GOLF BAGS
F
LQUID-057MX (Mexico)
LIQUIDMETAL
613402
08/06/2003
843878
07/22/2004
REGISTERED
RENEWAL DUE
08/06/2013
CLASS 028: SPORTING GOODS, TENNIS RACKETS, SKIS, SKI POLES, SNOWBOARDS, SPORTING KNIVES, TENNIS BAGS, TENNIS CASES, GOLF CLUBS, GOLF BALLS AND GOLF BAGS
F
LQUID-057RC2 (China)
LIQUIDMETAL
6079477
05/30/2007
 
PENDING
APPLICATION
REJECTED;
FILED
RESPONSE IN
08/2009; TAKES
APPROX. 18
MONTHS TO
GET DECISION
CLASS 6: AMORPHOUS METALS, METAL CASTINGS AND METAL HINGES FOR CELLULAR PHONES
F
 
 
12

 

LQUID-057RC3 (China)
LIQUIDMETAL
6079478
05/30/2007
 
PENDING
APPLICATION
REJECTED;
FILED
RESPONSE IN
08/2009; TAKES
APPROX. 18
MONTHS TO
GET DECISION
CLASS 9: CELLULAR TELEPHONES, PERSONAL DATA ASSISTANTS, MP3 PLAYERS, COMPUTER MEMORY HARDWARE, PERSONAL DIGITAL ASSISTANTS, PORTABLE LISTENING DEVICES, CAMCORDERS, CINEMATOGRAPHIC CAMERAS, PHOTOGRAPHIC CAMERAS, COMPACT DISC PLAYERS, COMPUTERS, PRINTERS FOR USE WITH COMPUTERS, MAGNETIC DISKS, GAUGES, LOUDSPEAKERS, MEASURING INSTRUMENTS, PORTABLE TELEPHONES, PROTECTIVE HELMETS, PROTECTIVE HELMETS FOR SPORTS, RADIOS, VEHICLE RADIOS, AUDIO AND VIDEO RECEIVERS, SOUND RECORDING APPARATUS, SPECTACLE FRAMES, SPECTACLES/OPTICS, PERSONAL STEREOS, SUNGLASSES, TELEPHONE APPARATUS, BULLET-PROOF VESTS, VIDEO TELEPHONES, WORKMAN'S PROTECTIVE FACE-SHIELDS, AND PROTECTION DEVICES AGAINST X-RAYS.
F
LQUID-057RU (Russia)
LIQUIDMETAL
2003715095
08/05/2003
297443
10/31/2005
REGISTERED
RENEWAL DUE
08/05/2013
CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS, SKIS, SKI POLES, SNOWBOARDS, SPORTING KNIVES, TENNIS BAGS AND TENNIS CASES
F
LQUID-057T
LIQUIDMETAL
78/224,925
03/12/2003
3,159,720
10/17/2006
REGISTERED
8 & 15 DECL.
DUE 10/17/2012
CLASS 008: SPORTING KNIVES CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS; AND MATERIALS USED IN SKIS, SKI POLES AND SNOW BOARDS
U
LQUID-058T
LIQUIDMETAL (stylized)
78/225,717
03/14/2003
3,230,417
04/17/2007
REGISTERED
8 & 15 DECL.
DUE 04/17/2013
CLASS 008: SPORTING KNIVES CLASS 025: WEARING APPAREL, NAMELY, SHIRTS, T-SHIRTS, SHORTS, PANTS, SWEATSHIRTS, SWEATPANTS, HATS, VISORS, SHOES AND BELTS CLASS 028: SPORTING GOODS, NAMELY, TENNIS RACKETS; AND MATERIALS USED IN SKIS, SKI POLES AND SNOW BOARDS
U
LQUID-059T
PURE ENERGY, PERFECT POWER
78/224,935
03/12/2003
2,955,613
05/24/2005
REGISTERED
8 & 15 DECL.
DUE 05/24/2011
CLASS 028: SPORTING GOODS, NAMELY TENNIS RACKETS, SKIS, SKI POLES AND SNOW BOARDS
U
 
 
13

 
 
LQUID-064T
LIQUIDMETAL
   
NOT FILED
AWAITING CLIENT
INSTRUCTIONS
CLASS 025: CLOTHING FOR MEN; WOMEN; JUNIORS; AND CHILDREN, NAMELY SHIRTS, INCLUDING T-SHIRTS; POLO SHIRTS; CASUAL; DRESS; TOPS, BLOUSES; HALTER TOPS; TANK TOPS, SWEATERS, PANTS; INCLUDING CASUAL; SLACKS; AND JEANS, SUITS, DRESSES, INCLUDING CASUAL AND EVENING GOWNS, SKIRTS, COATS AND JACKETS, INCLUDING BLAZERS, UNIFORMS, SLEEPWEAR, INCLUDING PAJAMAS AND NIGHTGOWNS, ROBES, BEACHWEAR AND SWIMWEAR, INCLUDING BATHING SUITS; SWIM TRUNKS; BIKINIS; AND WRAPS, HATS, LOUNGEWEAR, INCLUDING SWEATS; SWEATSHIRTS AND THE LIKE; UNDERWEAR; INCLUDING BOXERS; BRIEFS, PANTIES AND THE LIKE.
U
LQUID-067T
LIQUIDMETAL
78/507,702
18/28/2004
3,610,314
04/21/2009
REGISTERED
8 & 15 DECL.
DUE 04/21/2015
CLASS 006: METAL CASTINGS AND METAL HINGES FOR CELLULAR PHONES CLASS 014: JEWELRY
U
LQUID-069T
LIQUIDMETAL (stylized)
78/911,296
06/19/2006
3,633,282
06/02/2009
REGISTERED
8 & 15 DECL.
DUE 06/02/2015
CLASS 009: CELLULAR TELEPHONES, PERSONAL DATA ASSISTANTS, MPS PLAYERS, AND COMPUTER MEMORY HARDWARE CLASS 014: WATCHES
U
LQUID-070EU (Europe)
LIQUIDMETAL
005157359
06/23/2006
005157359
08/29/2007
REGISTERED
RENEWAL
DUE: 06/23/2016
CLASS 009: PERSONAL DIGITAL ASSISTANTS, PORTABLE LISTENING DEVICES, CAMCORDERS, CINEMATOGRAPHIC CAMERAS, PHOTOGRAPHIC CAMERAS, COMPACT DISC PLAYERS, COMPUTERS, PRINTERS FOR USE WITH COMPUTERS, MAGNETIC DISKS, GAUGES, LOUDSPEAKERS, MEASURING INSTRUMENTS, PORTABLE TELEPHONES, PROTECTIVE HELMETS, PROTECTIVE HELMETS FOR SPORTS, RADIOS, VEHICLE RADIOS, AUDIO AND VIDEO RECEIVERS, SOUND RECORDING APPARATUS, SPECTACLE FRAMES, SPECTACLES/OPTICS, PERSONAL STEREOS, SUNGLASSES, TELEPHONE APPARATUS, BULLET-PROOF VESTS, VIDEO TELEPHONES, WORKMAN'S PROTECTIVE FACE-SHIELDS, AND PROTECTION DEVICES AGAINST X-RAYS CLASS 010: MEDICAL DEVICES, NAMELY, HIP JOINT ORTHOPEDIC IMPLANTS AND KNEE BRACES; DENTAL INSTRUMENTS, NAMELY, PICKS, BURRS AND MIRRORS. CLASS 014: WATCHES, CLOCKS AND JEWELRY
F

 
14

 
 
LQUID-070HK (Hong Kong)
LIQUIDMETAL
301217330
10/09/2008
 
PENDING
APPLICATION
PUBLISHED;
AWAITING
CERTIFICATE
OF
REGISTRATION
CLASS 14: WATCHES, CLOCKS AND JEWELRY
F
LQUID-070JP (Japan)
LIQUIDMETAL
2008-84917
10/20/2008
5233668
05/22/2009
REGISTERED
RENEWAL
DUE: 0/22/2019
CLASS 14: WATCHES, CLOCKS AND JEWELRY
F
 
 
15

 
 
SCHEDULE 1 TO AGREEMENT (CONTINUED)
 
License Agreements
 
Amended and Restated License Agreement, dated September 1, 2001, by and between California Institute of Technology and Assignor.

 
16

 
 
ANNEX 5
 
Payoff Letter

 

 
 
FORM OF PAYOFF LETTER
 
July 20, 2010

Liquidmetal Technologies, Inc. ("LMT")
 
WC Collateral Agent LLC
30452 Esperanza
 
450 Seventh Avenue, Suite 509
Rancho Santa Margarita, CA 92688
 
New York, NY 10123
Attention: Tony Chung
 
Attention: Dwight Mamanteo
("tony.chung@liquidmetal.com)
 
(dwight@wynnefieldcapital.com)
 
Re:
Payoff of the 8% Senior Secured Convertible Note (the "Note") dated May 1, 2009 by LMT in favor of ____________ ("Creditor")
 
Dear LMT Management:
 
LMT has offered to pay Creditor in full of all indebtedness of LMT under the Note on July 23, 2010 (the "Payoff Date").
 
Upon receipt of (i) immediately available funds in the amount of _____________ (the "Payoff Amount"), representing all unpaid principal, interest, fees, costs and expenses under the Note, as fully set forth on attached Exhibit A, and (ii) a fully executed counterpart to this letter:
 
1.           All indebtedness to Creditor under the Note for principal, interest, fees, charges, costs, expenses and all other amounts shall have been paid in full.
 
2.           Creditor's security interest in all of LMT's and LMT's subsidiaries' property shall automatically be released, terminated and satisfied, and Creditor shall execute and deliver (and hereby authorizes and directs, WC Collateral Agent LLC, as collateral agent for Creditor's security interest, to execute and deliver) such releases, termination statements or directions to terminate as LMT may reasonably request, which must be prepared and filed by LMT at LMT's sole cost and expense.
 
3.           LMT is authorized by Creditor to file UCC termination statements to terminate Creditor's security interest in LMT's personal property Collateral.
 
4.           The Note, each agreement executed pursuant thereto, and each credit facility extended by Creditor thereunder shall be terminated and the obligations of each party thereunder shall cease to be of any further force or effect.
 
The Payoff Amount should be sent as follows:

Bank Name:
   
Bank Address:
   
Bank Phone #:
   
Account Name:
   
Swift code:
   
Routing #:
   
Account #:
   
 
5.           Creditor shall concurrently herewith deliver (i) the original Note (or an affidavit and indemnity of lost note in a form reasonably acceptable to the Debtor) to WC Collateral Agent LLC pursuant to the escrow letter provided by the Debtor, and (ii) and a copy of such escrow letter, signed by Creditor, to WC Collateral Agent LLC and to the Debtor.

 

 
 
6.           Creditor shall confirm to LMT and WC Collateral Agent LLC that it has received payment in full of the Payoff Amount (as such amount may be increased as set forth below).
 
7.           Creditor understands that the information contained in this letter is non-public information.
 
By executing and delivering a copy of this letter to LMT, Creditor hereby represents and warrants that it holds all right, title and interest in and to the Note and all payments of principal, interest, fees and other charges thereunder, in each case, free and clear of all interests therein securing an obligation owed by Creditor, or any claim against Creditor, whether such interest is based on common law, statute or contract, including liens, security interests, pledges, hypothecations, statutory trusts and other encumbrances affecting the Note. Creditor shall defend, indemnify and hold LMT harmless from and against any and all liability, loss, expense (including, without limitation, attorneys' fees') or claims incurred by LMT as a result of the foregoing representation and warranty being inaccurate.
 
In the event that Creditor does not receive the Payoff Amount in immediately available funds on or before the Payoff Date, an additional per diem amount of __________ shall be added to the Payoff Amount for accrued interest. In the event that Creditor does not receive the Payoff Amount in immediately available funds on or before 5:00 p.m. (Eastern Daylight Time) on August 31, 2010, then this letter will automatically terminate and be void and of no further force and effect.
 
Creditor hereby absolutely and unconditionally releases and forever discharges LMT, and any and all participants, parent corporations, subsidiary corporations, affiliated corporations, insurers, indemnitors, successors and assigns thereof, together with all of the present and former directors, officers, agents and employees of any of the foregoing, from any and all claims, demands or causes of action of any kind, nature or description, whether arising in law or equity or upon contract or tort or under any state or federal law or otherwise, which Creditor has had, now has or has made claim to have against any such person for or by reason of any act, omission, matter, cause or thing whatsoever arising from the beginning of time to and including the date of this letter, whether such claims, demands and causes of action are matured or unmatured or known or unknown. It is the intention of Creditor in providing this release that the same shall be effective as a bar to each and every claim, demand and cause of action specified, and in furtherance of this intention it waives and relinquishes all rights and benefits under Section 1542 of the Civil Code of the State of Califoria, which provides:
 
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MIGHT HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR."
 
Creditor acknowledges that it may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such claims, demands, or causes of action and agree that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. Creditor understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release. Notwithstanding anything herein to the contrary, nothing in the foregoing release will release Debtor from any obligations that it may have to Creditor under the terms of the Series A Preferred Stock and Warrants of the Debtor held by the Creditor.
 
This Payoff Letter shall be governed by and construed in accordance with the laws of the State of California without giving effect to any conflict of laws principles to the contrary. The parties hereby consent to jurisdiction and venue in the appropriate state and Federal courts sitting in the Northern District of California in any litigation between them arising out of this Payoff Letter.

 

 
 
This letter may be signed and exchanged in counterparts, all of which when taken together shall constitute one and the same agreement. Signature by facsimile will also bind the parties to this letter.

 
Very truly yours,
 
       
     
       
 
By:
   
 
Name:
   
 
Title:
   

ACKNOWLEDGED AND AGREED TO:
 
     
LIQUIDMETAL TECHNOLOGIES, INC.
 
     
By
   
 
Name:
 
 
Title:
 

 

 

Exhibit A

Principal
 
   
Interest
 
   
TOTAL
 

 

 

ANNEX 6

Apple License

 

 
 
CONFIDENTIAL
 
EXCLUSIVE LICENSE AGREEMENT
 
This Exclusive License Agreement ("Agreement") is entered into as of August 5, 2010, by and between Apple Inc., a California corporation having an address of 1 Infinite Loop, Cupertino, CA 95014 ("Apple"), and Crucible Intellectual Property, a Delaware limited liability company having an address of 31441 Santa Margarita Pkwy., Suite A #247, Rancho Santa Margarita, California 92688 ("Crucible"). Either Apple or Crucible may be referred to individually herein as a "Party", and Apple and Crucible may be referred to collectively herein as the "Parties".
 
RECITALS
 
WHEREAS, Apple, LMT, LMC and Crucible have entered into that certain Master Transaction Agreement, dated as of August 5, 2020 ("MTA") and this Agreement is entered into pursuant the MTA.
 
NOW THEREFORE, the Parties hereby agree as follows:

ARTICLE 1
DEFINITIONS
 
Unless a term is defined in this Agreement, all defined terms shall have the meanings specified in the Master Transaction Agreement.
 
1.1.
"Agreement" shall mean this License Agreement.
 
1.2.
"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.
 
1.3
"Effective Date" shall mean the date of this Agreement.
 
1.4
"Licensed Products" shall mean any product made or sold by or on behalf of Apple Inc. in the field of use of Consumer Electronic Products.
 
1.5
"Licensees" shall mean and include individually and collectively Apple, and any Subsidiary thereof
 
1.6
"Licensor" shall mean Crucible.

 
- 1 -

 
 
CONFIDENTIAL
 
ARTICLE 2
GRANT, PAYMENT, and ENFORCEMENT OF RIGHTS
 
2.1
Exclusive License Grant. Licensor grants to Licensee a fully paid-up, royalty-free,irrevocable, perpetual, worldwide exclusive license and sublicense, with the right to grant sublicenses, under the LMT Technology in the exclusive field of use of Consumer Electronic Products, to use, reproduce, publish, display, distribute, perform, exploit and disclose the LMT Technology and 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 in connection with its exercise of the foregoing license, to perform any act or step that incorporates, utilizes, embodies or reflects the LMT Technology, including without limitation any such activities that would, absent 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. Licensor expressly forfeits the right to use, reproduce, publish, display, distribute, perform, exploit and disclose the LMT Technology in the exclusive field of use of Consumer Electronic Products. Licensee's exclusive rights in the field of use of Consumer Electronic Products shall be subject to the rights granted to LMT in Section 2.2 of the LMT License Agreement.
 
2.2
Payment Terms. In consideration of the licenses granted by Licensor hereunder, Apple will pay to or on behalf of Licensor (a) an aggregate amount equal to $[*] (the "Initial Payment") on the Effective Date and (b) a final payment in an amount equivalent to $[*] less the Initial Payment and repayment to Apple of $[*] in advances made to LMT prior to the date of this Agreement (the "Final Payment"), which shall be payable ninety (90) days after the Closing Date conditioned on LMT's full and complete compliance with its obligations under the Statement of Work entitled "LMT-Apple Initial Support Period" under Technology Development Agreement of even date herewith between LMT and Apple. The Initial Payment will be deemed to be distributed by Licensor to LMT and will be paid by Licensee directly to selected creditors of LMT and LMT in accordance with the Escrow Agreement of even date herewith among U.S. Bank, Licensor, Licensee, and LMT. The Final Payment will be paid directly by Licensee to LMT and will be deemed to be a distribution by Licensor to LMT.
 
 
 
 
 

[*] =
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS AND AN ASTERISK, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
 
 
- 2 -

 
 
CONFIDENTIAL
 
2.3
Enforcement of Rights. Licensor grants to Licensee the exclusive right for enforcement of the Intellectual Property Rights of the LMT Technology in the field of use of Consumer Electronic Products. Licensee shall pay all fees associated with the enforcement of Intellectual Property Rights. Licensee may have the right to take reasonable steps to enforce such Intellectual Property Rights against any infringement of such Intellectual Property Rights. Licensee may: (a) bring actions for enforcement in its own name (where allowed by law), and (b) have unrestricted right to choose strategy and direct any enforcement action. Licensee has the sole and exclusive right to agree to settlement of the enforcement action. Licensee shall be entitled to any monetary recovery from such enforcement action whether from settlement, judgement or otherwise. Licensor shall assist Licensee in bringing an enforcement action, including, where necessary, executing whatever documents are necessary to afford to Licensee the opportunity to bring the action for enforcement. The Parties shall bear their own costs associated with any such enforcement action. In the event that Licensee cannot bring the enforcement action in Licensee's name, Licensee has the right to either join the Licensor as a party in the enforcement action or to have the enforcement action brought in the name of the Licensor. In connection therewith, Licensee shall: i) have the unestricted right to choose strategy and direct of the enforcement action; ii) have the sole and exclusive right to agree to settlement of the enforcement action; and iii) be entitled to any monetary recovery from such enforcement action whether from settlement, judgment or otherwise. The Parties shall bear their own costs associated with such enforcement action, subject to, if the Licensee receives monetary recovery as a result of the enforcement action, the Licensee shall reimburse the Licensor for Licensor's reasonable costs out of the monetary recovery. In the event that Licensee should decide not to enforce its rights related to the LMT Technology, then Licensee shall afford to Licensor the opportunity to bring an action for enforcement at its own cost and expense, and to choose strategy and direction of such an action, in which case Licensor shall be entitled to the entire monetary recovery. Notwithstanding the foregoing, either Party may be represented by counsel in any enforcement action, and shall bear its costs associated therewith; however, such costs (including counsel fees) shall not be reimbursable by the other Party, unless otherwise agreed by the Parties. In the event that any enforcement action involves products both inside and outside of the field of Consumer Electronic Products, then Licensor and Licensee shall cooperate in good faith to allocate the costs and recovery associated with such action in proportion to the relative value of the action to the parties.
 
2.4
Release. Licensor on behalf of itself and its Affiliates, successors and assigns, hereby releases, acquits and forever discharges Licensee, its Affiliates, and all of their respective current and former predecessors, successors, agents, attorneys, insurers, servants, distributors, retailers, resellers, manufacturers, suppliers, employees, officers, directors, users, and customers from any and all claims of infringement and misappropriation of the LMT Technology, that occurred prior to the Effective Date.
 
2.5
Trademark Usage. In the event that Licensee desires to utilize the Liquidmetal® trademark, or any other 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 Trademark or change the appearance of any stylized or logo form of the Trademark, and (v) the "®" icon shall always follow the Trademark, and (v) Licensee agrees not to take any other action that would be reasonably expected to undermine the enforceability of the Trademark.
 
 
- 3 -

 
 
CONFIDENTIAL
 
2.6
Subordination of Security Interest. Crucible has granted Apple a security interest in all of its assets, including, without limitation, the LMT Technology which is licensed to Apple pursuant to this Agreement. Crucible hereby agrees that in the event such security interest shall be enforced and, as a result of such enforcement, any of the LMT Technology shall be transferred to any person or entity, (a) such person or entity shall acquire or otherwise receive such LMT Technology subject to all rights, powers and privileges of Apple under this Agreement, (b) such acquirer may not interfere with or disturb Apple's use and enjoyment of such rights, powers and privileges, and (c) this Agreement shall continue in full force and effect as if such security interest had not been granted or enforced.
 
ARTICLE 3
CONFIDENTIALITY
 
3.1
The terms and existence of this Agreement shall be treated as Confidential Information pursuant to the Apple Inc. Confidentiality Agreement, executed on April 30, 2010 by Apple Inc. and LMT.

ARTICLE 4
TERM AND COVENANT NOT TO SUE
 
4.1
Term. The term of this Agreement commences on the Effective Date and shall continue in perpetuity.
 
4.2
Rejection. 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 for damages against Licensor equal to all amounts paid by Apple to or on behalf of LMT, LMC and Crucible pursuant to all Transaction Documents plus interest thereon from the date of such payment until the date on which Apple recovers payment in full of from the defaulting LMT party (or, if LMT is not the defaulting LMT party, LMT pursuant to Section 14 of the MTA) all damages hereunder and under the other Transaction Documents at a rate per annum equal to the greater of (i) 10% or (ii) "prime rate" as reported in The Wall Street Journal in effect from time to time plus two percent. Alternatively, Licensee may elect, under section 365(n) to continue as licensee under this Agreement, and shall only be responsible for the payment of the fees identified in Section 2.2 above.

 
- 4 -

 
 
CONFIDENTIAL
 
4.3
Covenant Not to Sue. Licensor, on behalf of itself and its respective heirs, executors, successors, assigns, agents and all other persons and entities associated with either of them, 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, assert, or participate in any claim or allegation against any of the following for infringement of Intellectual Property Rights of any of the LMT Technology: (i) Licensee; or (ii) their respective past, present and future owners, shareholders, parents, subsidiaries, successors, assigns, divisions, units, officers, directors, employees, agents, attorneys, or representatives, or (iii) their 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 Apple related to or in connection with any Apple-branded or Apple-licensed product. This covenant not to sue does not inure to the benefit of any third parties for their conduct that is unrelated to Licensees. For purposes of this paragraph, the grant to LMT or LMC of an exclusive license under the LMT Technology in a field other than Consumer Electronic Products shall not be a violation of this paragraph, even if LMT or LMC is granted, as a part of such exclusive license, the right to sue or otherwise assert infringement claims with respect to such Intellectual Property Rights. Further, Crucible shall not be in breach of this subsection if Crucible 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 Apple, provided that a court of competent jurisdiction shall have ruled that Crucible's participation as a party is necessary to such proceedings and shall have ordered Crucible to participate as a party.
 
4.4
Grant-Back of License. Crucible has no right to transfer, assign, sell, convey or otherwise dispose of, any of the LMT Technology and/or the Intellectual Property related thereto. If for any reason, Crucible transfers, assigns, sells, conveys or otherwise disposes of, any of the LMT Technology and/or the Intellectual Property related thereto, Crucible shall grant Apple a fully paid-up, royalty-free, irrevocable perpetual, worldwide, nonexclusive license and sublicense, with the right to grant sublicense, under the LMT Technology to use, reproduce, publish, display, distribute, perform, exploit and disclose the LMT Technology and 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 perform any act or step that incorporates, utilizes, embodies or reflects the LMT Technology, including, without limitation, any such activities that would, absent 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. If the nonexclusive license described herein cannot be granted, the transfer, assignment, sale, conveyance of disposing of the LMT Technology and/or the Intellectual Property related thereto by the Crucible shall be void ab initio.

 
- 5 -

 
 
CONFIDENTIAL
 
4.5
Licensor Obligations. Crucible shall (a) fully perform all obligations and discharge all liabilities under any licenses, sublicenses and other agreements included in the LMT Technology 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 the LMT Technology; (c) promptly provide Apple 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 4.5 upon making such payment, and upon request of Apple, provide copies of documents as may be reasonably necessary or advisable to confirm that Crucible has performed the obligations set forth in this Section 4.5; (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 the LMT Technology; and (e) upon request from Apple, provide Apple with reasonably detailed reports and copies of documents as may be reasonably necessary or advisable to confirm that Crucible has performed the foregoing obligations. Crucible hereby irrevocably appoints Apple its true attorney in fact to perform any of the following powers, which are coupled with an interest, until termination of this Agreement and may be exercised from time to time by Apple's officers and employees, or any of them to perform any obligation of Crucible under this Section 4.5, in Crucible's name or otherwise.

ARTICLE 5
MISCELLANEOUS PROVISIONS
 
5.1.
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 or on the third business day following mailing.
 
5.2
Licensor shall not assign, transfer, subcontract or otherwise delegate any of its obligations under this Agreement without Apple's prior written consent in each instance. 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.
 
5.3
Licensor acknowledges that any breach of this Agreement by it may cause irreparable harm to Apple or its affiliates and that the remedies for breach may include injunctive relief against such breach, in addition to damages and other available remedies. The prevailing party shall be entitled to the award of its reasonable attorneys' fees in any action to enforce this Agreement.

 
- 6 -

 
 
CONFIDENTIAL
 
5.4
This Agreement, including any recitals, terms, conditions, and provisions herein, and all exhibits attached hereto and 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.
 
5.5
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 both parties, and no oral amendment shall be binding on the parties.
 
5.6
This Agreement shall be governed by and construed in accordance with the laws of the State of California without giving effect to any conflict of laws principles to the contrary. The parties hereby consent to jurisdiction and venue in the appropriate state and Federal courts sitting in the Northern District of California in any litigation between them arising out of this Agreement. If any provision of this Agreement is held to be invalid or unenforceable to any extent in any context, it shall nevertheless be enforced to the fullest extent allowed by law in that and other contexts, and the validity and force of the remainder of this Agreement shall not be affected thereby.
 
5.7
The Parties have had the opportunity to negotiate the terms of this Agreement, and no Party shall be deemed the drafter of all or any portion of this Agreement for purposes of interpretation. The terms of this Agreement shall be binding and shall be strictly construed in any proceeding relating or pertaining to this Agreement. Without affecting the obligations of the Parties otherwise expressed, the term "shall" when used in connection with any act or obligation to be undertaken means an affirmative obligation. The term "including" shall mean "including but not limited to." All terms shall be construed in the masculine or feminine and in plural or singular as required by the context in which the term is used. The definitions of terms in this Agreement are limited to this Agreement.
 
5.8
If any one or more of the provisions of this Agreement is held to be invalid, illegal, or unenforceable in any respect, the other provisions shall remain in full force and effect. Any provision deemed invalid, illegal, or unenforceable because its scope is considered excessive shall be modified only to the minimum extent necessary to render the provision valid, legal, and enforceable under California law.

 
- 7 -

 
 
CONFIDENTIAL
 
5.9
Each Party has had, or has had the opportunity to obtain, the advice of legal, accounting, and other professional advisers regarding the language in this Agreement. No Party has relied on legal counsel for another Party, and no legal counsel or other adviser for a Party shall have any duty or obligation to another Party. Each Party has read and understands this Agreement and is executing this Agreement as the Party's free act and without duress.
 
[intentionally blank]
 
 
- 8 -

 
 
CONFIDENTIAL

IN WITNESS WHEREOF, each of the parties has executed this Agreement as of the date first written above. Each of the persons signing this Agreement affirms that he or she 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.