License Agreement

LICENSE AGREEMENT


This is a License Agreement dated as of June 16, 1997 (as in effect from time to time, the "Agreement"), by and among Lockheed Martin Chemical Demilitarization Systems, LLC, a Delaware limited liability company (the "LLC"), Molten Metal Technology, Inc., a Delaware corporation ("MMT"), and Lockheed Martin Corporation, a Maryland corporation ("LMC").


WHEREAS, MMT is an environmental technology company engaged in the commercialization and continued development of its innovative, proprietary processing technology known as Catalytic Extraction Processing or CEP;


WHEREAS, a wholly-owned subsidiary of MMT and a wholly-owned subsidiary of LMC have formed the LLC in order to effectively commercialize CEP by selling, engineering, constructing and operating CEP Plants, and sublicensing CEP technology to appropriate third parties to permit them to engineer, construct and operate CEP Plants, to pursue the processing of Chem Weapons Feedstocks worldwide;


WHEREAS, MMT and LMC have entered into a Master Restructuring Agreement, dated as of June 12, 1997 (as in effect from time to time, the "Restructuring Agreement"), pursuant to which they agreed to restructure certain aspects of their business relationship; and


WHEREAS, in the Restructuring Agreement LMC and MMT agreed enter into, and cause the LLC to enter into, this Agreement;


NOW, THEREFORE, in consideration of the foregoing and the mutual agreements set forth below and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, MMT, LMC and the LLC agree as follows:


* Confidential treatment has been requested for certain portions of this Exhibit 10.2. 2
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Article 1


Defined Terms


Defined terms used and not otherwise defined herein shall have the meanings ascribed thereto in the Restructuring Agreement. In addition, as used in this Agreement the following terms shall have the following meanings:


"Advisors" means, with respect to any Person, any of such Person's attorneys, accountants, lenders or consultants.


"Affiliate" means, with respect to any Person, any other Person controlling, controlled by or under common control with, such Person. As used in this definition, "control" (including, with its correlative meanings, "controlled by" and "under common control with") means the possession, directly or indirectly, of power to direct or cause the direction of management or policies of a Person, whether through ownership of securities or partnership or other ownership interests, by contract or otherwise (but, in the case of MMT or LMC, not including the LLC and, in the case of the LLC, not including MMT or LMC).


"Agreement" has the meaning set forth in the preamble.


"Asset Transfer Agreement" means the Asset Transfer Agreement entered into pursuant to the Restructuring Agreement, as in effect from time to time.


"Catalytic Extraction Processing" or "CEP" means the processes, methods and systems (including all intellectual and intangible and tangible property associated therewith and including all aspects of accepting Feedstocks, reactions within a CEP Plant, and handling Recovered Resources), owned or used by MMT, directed to the processing of Feedstocks by introducing the Feedstocks to a processing vessel containing liquefied metal.


"CEP Plant" means the plant, equipment and other facilities necessary to perform, operate and maintain CEP on a commercial basis (or, in the case of any so-called "demonstration" CEP Plant, on the basis generally provided in the applicable demonstration program).


"Chem Demil Market" means the worldwide market for the processing of Chem Weapons Feedstocks worldwide


"Chem Weapons Feedstocks" means (i) bombs, rockets, artillery shells, mortar shells and explosives and other munitions, containing (or formerly containing) one or more "chemical weapons agents" (as defined in the Chemical Weapons Convention (formally known as the Convention on the Prohibition of the Development, Production, Stockpiling and Use of Chemical Weapons and their Destruction), adopted 3
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September 3, 1992 at the Conference on Disarmament at Geneva, and opened for signature on January 13, 1993 in Paris) and (ii) bulk stockpiles of such chemical weapons agents.


"Dispute Resolution Agreement" means the Second Amended and Restated Dispute Resolution Agreement, dated as of June 12, 1997 by and among LMC, MMT, M4, the LLC and their Affiliates named therein.


"Employee Non-Disclosure Agreement" has the meaning set forth in Section 4.7.


"Failure Notice" has the meaning set forth in Section 4.8.


"Feedstocks" means, with respect to any CEP Plant, the wastes, industrial by-products and other materials to be processed by such CEP Plant.


"Government Authority" means any federal, national, state, municipal, local, territorial or other governmental department, commission, board, bureau, agency, regulatory authority, instrumentality, judicial or administrative body, domestic or foreign.


"Improvements" means any improvements, developments, updates, upgrades, enhancements, additions, revisions, corrections, fixes and other modifications to the MMT Licensed Property as it then exists that MMT, LMC or the LLC may acquire, discover, invent, originate, conceive or have a right to develop or manufacture, whether or not the same is patentable, commercially useful or reducible to writing or practice.


"Infringements" has the meaning set forth in Section 7.1.


"Intellectual Property" means all patents, inventions, patent applications, patent rights, trademarks, trademark registrations, trade names, brand names, all other names and slogans embodying business or product goodwill (or both), copyright registrations, copyrights (including those in computer programs, software, including all source code and object code, development documentation, programming tools, drawings, specifications and data), software, trade secrets, know-how, mask works, industrial designs, formulae, processes and technical information, including confidential and proprietary information, whether or not subject to statutory registration or protection.


"Japanese Extension Agreement" means the Agreement for Expansion of License - Japanese Chemical Weapons, dated as of September 20, 1996, between M4 and MMT.


"JCW Market" means the processing of any Chem Weapons Feedstocks for which any Japanese Government Authority has accepted, or in the future accepts, responsibility.


"JCW Task Order" has the meaning set forth in Section 2.4. 4
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"Licensed Copyrights" means any and all copyright protection of MMT covering any of the Licensed Software Programs, the Licensed Know-How or any Improvements thereto.


"Licensed Know-How" means any information possessed by MMT or, subject to Section 2.2, licensed to MMT, relating to CEP, whether or not considered proprietary and whether or not subject to statutory registration or protection, including, without limitation, inventions disclosed by MMT's existing Patent Applications, invention records, research records and reports, development reports, experimental and other engineering reports, pilot plant designs, production plant designs, production specifications, raw material specifications, quality control reports and specifications, drawings and photographs, models, tools and parts, manufacturing and production techniques, processes, methods and marketing surveys. If any information or material qualifies for purposes of this Agreement both as Licensed Know-How and as any of the Licensed Patents, Licensed Copyrights, Licensed Software Programs or Licensed Trademarks for purposes of this Agreement, such information or material shall not be treated as Licensed Know-How for purposes of this Agreement but shall be treated, as applicable, as part of the Licensed Patents, Licensed Copyrights, Licensed Software Programs or Licensed Trademarks for purposes of this Agreement.


"Licensed Patent Applications" means any U.S. or foreign patent applications currently owned by, filed or acquired by or, subject to the restrictions set forth in Section 2.2 relating to patent applications licensed to MMT, licensed to MMT during the term of this Agreement, to the extent such patent applications relate to CEP.


"Licensed Patents" means any U.S. or foreign patents currently owned by, granted to, acquired by, or, subject to the restrictions set forth in Section 2.2 relating to patents licensed to MMT, licensed to MMT during the term of this Agreement, to the extent such patents relate to CEP.


"Licensed Software Programs" means any computer programs the copyrights to which are owned by or, subject to Section 2.2, licensed after the date of this Agreement to MMT relating to CEP.


"Licensed Trademarks" means any Trademarks currently owned by, developed or acquired by or, subject to Section 2.2, licensed to MMT during the term of this Agreement, to the extent such Trademarks relate to CEP and do not relate to MMT's corporate identity.


"LLC" has the meaning set forth in the preamble.


"LLC Agreement" means the Limited Liability Company Agreement of the LLC, as in effect from time to time. 5
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"LLC Confidential Information" means any confidential or proprietary information of the LLC.


"LLC Infringement Claim" has the meaning set forth in Section 7.4.


"LLC Services" has the meaning set forth in Section 4.8.


"LMC" has the meaning set forth in the preamble.


"LMC Confidential Information" means any confidential or proprietary information of LMC.


"MMT" has the meaning set forth in the preamble.


"MMT Confidential Information" means any confidential or proprietary information of MMT, including but not limited to any confidential or proprietary portion of the MMT Licensed Property.


"MMT Infringement Claim" has the meaning set forth in Section 7.3.


"MMT Licensed Property" means the Licensed Patents, the Licensed Patent Applications, the Licensed Trademarks, the Licensed Software Programs, the Licensed Copyrights and the Licensed Know-How.


"M4" means M4 Environmental L.P., a Delaware limited partnership.


"Person" means any individual, corporation, association, trust, limited liability company, joint venture, partnership (whether general or limited), unincorporated organization and any government, governmental department or agency or political subdivision thereof.


"Project Acceptance" means, with respect to any application of CEP that is the subject of a fee payable pursuant to Section 2.4(a), that the CEP Plant has achieved mechanical completion and passed a performance test to be created by the Board of Directors of the LLC at the time it determines to proceed with the applicable project.


"Quality Standard" has the meaning set forth in Section 4.8.


"Recycling" means the return of resources recovered or produced from waste or other similar materials for use or sale.


"Recovered Resources" means the elements and compounds produced by a CEP Plant (whether or not produced through the use of reactants) that are suitable for use or sale. 6
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"Related Agreements" means this Agreement, the Restructuring Agreement, the LLC Agreement, the Related Agreements referred to in the Restructuring Agreement and any other agreement between MMT or the LLC or their Affiliates which specifies that it is a Related Agreement for purposes of this Agreement.


"Related Technology" has the meaning set forth in Article 5.


"Restructuring Agreement" has the meaning set forth in the preamble.


"SAC" means LMC-MMT Strategic Alliance Committee, LLC, the limited liability company formed pursuant to the SAC LLC Agreement.


"SAC LLC Agreement" means the Limited Liability Company Agreement pursuant to which SAC was formed.


"Subsidiary" means a corporation, company or other entity:


(i) more than fifty percent (50%) of whose outstanding shares or
securities (representing the right to vote for the election of
directors or other managing authority) are, now or hereafter,
owned or controlled, directly or indirectly, by a party
hereto, but such corporation, company or other entity shall be
deemed to be a Subsidiary only so long as such ownership or
control exists; or


(ii) which does not have outstanding shares or securities, as may
be the case in a partnership, joint venture or unincorporated
association, but more than fifty percent (50%) of whose
ownership interests representing the right to make the
decisions for such corporation, company or other entity is now
or hereafter, owned or controlled, directly or indirectly, by
a party hereto, but such corporation, company or other entity
shall be deemed to be a Subsidiary only so long as such
ownership or control exists.


"Technical Liaison" has the meaning set forth in Section 3.1.


"Trademarks" shall mean:


(i) all of the trademarks, service marks, trade names, designs,
logos, indicia, corporate names (other than the corporate
names of MMT and its Subsidiaries), company names, business
names, fictitious names, trade styles, elements of package or
trade dress, and/or other source and/or other service
identifiers and general intangibles of like nature, used or
associated with CEP, which are currently or in the future
adopted, acquired, owned, held and/or used by MMT in its
business; and 7
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(ii) all past, present or future federal, state, local and foreign
registrations or recordations of any of the foregoing
enumerated in clause (i), all renewals and extensions of such
registrations or recordations, all past, present and future
applications for any such registrations or recordations of any
of the foregoing enumerated in clause (i) (and any such
registrations or recordations thereof upon approval of such
applications).


"Treatment" means, with respect to any material, any physical, mechanical, thermal and/or chemical actions that, individually or in concert, alter the chemical composition of such materials.


Article 2


Technology License; Certain Related Matters


2.1. Grant of License. Subject to the terms and conditions of this Agreement, MMT hereby grants to the LLC:


(i) a non-transferable, non-royalty-bearing exclusive license
(including the fact that MMT, its Affiliates and licensees are
likewise excluded) under the MMT Licensed Property (other than
the Licensed Trademarks) to: establish, own, permit, finance,
design, engineer, construct, start-up and operate CEP Plants
anywhere in the world that process Chem Weapons Feedstocks;


(ii) a non-transferable, non-royalty-bearing exclusive license
(including the fact that MMT, its Affiliates and licensees are
likewise excluded) to sublicense the MMT Licensed Property,
subject to and in accordance with the requirements of Article
6, to third parties (including Affiliates and Subsidiaries of
MMT) in order to permit them to establish, own, permit,
finance, construct, start-up and operate CEP Plants located
anywhere in the world that process Chem Weapons Feedstocks;


(iii) a non-transferable, non-royalty-bearing non-exclusive license
to use the Licensed Trademarks in connection with activities
permitted under subparagraph (i) or subparagraph (ii) above;
and


(iv) a non-transferable, non-royalty-bearing non-exclusive license
to use the MMT Licensed Property for its own internal use in
connection with the activities contemplated by subparagraphs
(i)-(iii) above. 8
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2.2. Third Party Limitations on License Grants. The licenses granted by MMT pursuant to Section 2.1 above, insofar as they relate to technology, property or rights that are developed or acquired with or from any third party in the future, may become subject to any applicable restrictions and consents relating to such technology, property or rights under any license or similar agreement to which MMT may in the future become a party. In the event that any such license or other agreement imposes restrictions that may apply to the transactions contemplated by this Agreement, MMT will make reasonable efforts to obtain license rights as contemplated by this Agreement for the LLC. If MMT is unable to so obtain such rights, it will cooperate to make available to the LLC such rights as the third party is willing to grant to or for the LLC. As part of the foregoing, MMT shall use reasonable efforts to assure that the LLC enjoys license or other rights no less favorable with respect to the applicable Intellectual Property acquired from such third parties than other licensees of MMT generally.


2.3. Extension of License to Subsidiaries. The licenses granted in Section 2.1 shall include the right of the LLC to sublicense its Subsidiaries. Any such sub-license shall be on terms and conditions satisfactory to each of MMT and the LLC.


2.4. Success Fees.


(a) For any project undertaken by the LLC employing CEP in the
Chem Demil Market, the LLC shall pay MMT a success fee in an
amount between 5% and 10% of the project's total installed
costs, up to a maximum of $5 million per project; provided
that no such success fee shall be payable with respect to any
project deployed for the JCW Market. The amount of any success
fee payable for any particular project shall be determined by
the Board of Directors of the LLC at the time the Board of
Directors of the LLC decides to proceed with the applicable
project.


(b) The LLC's obligations under this Section 2.4 shall terminate
upon MMT's receipt from the LLC of a total of $25 million in
cumulative success fees pursuant to this Section 2.4. There
shall be no limit on the number of projects for which success
fees are payable. All success fees shall become payable to MMT
upon Project Acceptance of the applicable CEP system, and
shall be in addition to any other compensation payable to MMT
by any Person. Any particular fee payable to MMT pursuant to
paragraph (a) above and this paragraph (b) shall be paid on a
quarterly basis to MMT from all revenues generated by the
particular CEP Plant for the particular quarter.


(c) The LLC and MMT shall negotiate and prepare a Task Order for
the technical demonstration by MMT of CEP processing for
surrogates of "Japanese Chemical Weapons" as contemplated by 9
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Section 5 of the Japanese Extension Agreement (the "JCW Task
Order"). At the time MMT completes a successful technical
demonstration, as determined by the criteria to be set forth
in the JCW Task Order, a $3,500,000 fee shall become payable
by the LLC. This fee shall be paid, in no event prior to
January 2, 1998, on a quarterly basis out of all LLC Cash Flow
for the applicable quarter. For purposes of this paragraph (c)
"LLC Cash Flow" means, with respect to any period, the LLC's
cash flows from operations for such period, with all of the
foregoing determined in accordance with GAAP (subject to the
establishment by the Board of Directors of the LLC of
reasonable reserves to meet liabilities of the LLC (including
contingent, conditional and unmatured liabilities)).


(d) The LLC will not make any cash distributions to its members at
any time when any fee referred to in this Section 2.4 has
become payable but has not yet been paid in full.


Article 3


Technical Liaison; Access to Technology


3.1. Technical Liaisons. MMT and the LLC have designated one or more employees to serve as technical liaison (the "Technical Liaison") for them under this Agreement and have notified the other party of the identity and address of such Technical Liaison. The Technical Liaison will continue to be the primary interface for all issues under this Agreement relating to technology, including the access to MMT Licensed Property referred to in Section 3.2 below, the ongoing program referred to in Section 4.7 relating to confidentiality concerns, the treatment of Improvements and Related Technology pursuant to Article 5 and the sublicensing program referred to in Article 6. However, no Technical Liaison shall be authorized to amend or waive any provision of this Agreement or any Related Agreement. Each of MMT and the LLC may change its Technical Liaison at any time and from time to time during the term of this Agreement by notifying the other party and its Technical Liaison in writing. Each Technical Liaison may nominate a designee to act on its behalf by giving a similar notification.


3.2. Access to Technology.


(a) In order to ensure that the LLC has sufficient access to and
familiarity with the MMT Licensed Property, the Technical Liaisons
shall meet from time to time to review and discuss the MMT Licensed
Property. The Technical Liaisons shall, as appropriate, cause
appropriate MMT and LLC employees to attend such meetings. The MMT
Technical Liaison shall provide the LLC Technical Liaison with such
writings, documents, instruments, 10
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