EDISON-SAUNDERS COMPRESSED AIR COMPANY
LICENSE AGREEMENT THIS AGREEMENT, made this 1st day of February 1901, by and between EDISON-SAUNDERS COMPRESSED AIR COMPANY of Orange, New Jersey, of the first part, and H.K. PORTER COMPANY of Pittsburgh, Pennsylvania, of the second part, WITNESSETH:
WHERAS the party of the first part, by virtue of direct and mesne assignments, is the owner of the entire right, title and interest in and to Letters Patent of the United States No. 486,411, dated November 15, 1892, granted jointly to William L. Saunders and Ingersoll-Sergeant Drill Company, for Method of Increasing the Efficiency of Motor Fluids; No. 643,764, dated February 20, 1900, granted to Thomas A. Edison, for Method of Reheating Compressed Air for Industrial Purposes; and No. 657,922, dated September 18, 1900, granted to Thomas A. Edison, for Apparatus for Reheating Compressed Air for Industrial Purposes;
AND WHERAS the party of the second part is desirous of acquiring from the party of the first part the exclusive right to manufacture, use and sell, in connection with locomotives for traction purposes exclusive of street railroad use, reheaters embodying and practicing the inventions described and claimed in said patents, under certain conditions and restrictions hereinafter recited;
NOW THEREFORE, in consideration of the sum of one dollar to each of the parties hereto by the other in hand paid, receipt whereof is hereby acknowledged, said parties do covenant and agree as follows, to wit:
I. The party of the first part hereby grants and conveys to the party of the second part of the sole and exclusive right, liberty and license to manufacture in its own shops at Pittsburgh, Pennsylvania, apparatus embodying the inventions of said patents or adapted to practice the methods thereof, and to use and vend to others to be used such apparatus, in consideration of the payment of royalty by the party of the second part to the party of the first part as hereinafter specified; provided, however, the apparatus so made by the party of the second part is limited for use in connection with locomotives for traction purposes exclusive of street railroad use, and for no other purpose.
II. It is understood that the license hereby granted is exclusive unless made a non-exclusive license as hereinafter provided for, and the party of the first part agrees that so long as this license is in force and remains of an exclusive character, it will not license any other person, firm or corporation to manufacture, use or sell such apparatus for use with locomotives for traction purposes for other than street railroad use in or throughout the United States. It is also understood that under the license granted hereby to the party of the second part, the party of second part shall be entitled to manufacture and sell such apparatus for the use stated for shipment outside of the United States until the party of the first part notifies the party of the second part in writing that the privilege of selling such apparatus for use outside of the United States is withdrawn, and upon the receipt of such notice, the party of the second part shall thereafter cease to sell such apparatus for use outside of the United States or ship such apparatus outside of the United States, and shall permanently mark said apparatus with an inscription containing the words "Sold for use only in the United States." The party of the second part also agrees to mark the apparatus which it manufactures and sells under this agreement with the word "Patented" and with the dates of the several patents owned by the party of the first part under which apparatus is manufactured.
III. It is hereby mutually agreed by and between the parties hereto that for the period of one year beginning from the date of the execution of this agreement the party of the second part shall be allowed, at its own expense, to make any tests or experiments with the said inventions to adapt them to the particular locomotives now made or which may hereafter be made by the party of the second part. It is understood and agreed however, by and between the parties hereto, that if during the said experimental period of one year the party of the second part equips any of its locomotives with the patented improvements and sells the same, the devices so made and sold shall be subject to the payment of royalty as hereinafter provided.
IV. The party of the first part agrees to furnish the party of the second part with working drawings of its most perfect form of reheater embodying said inventions upon the execution of this agreement.
V. The party of the second part agrees to grant and convey to the party of the first part an assignable license to make, use and vend any apparatus in the nature of improvements on said reheater or by which the operation thereof will be facilitated or improved, and which improvements may be developed by the part of the second part in its experiments above referred to in connection with the patented devices. And the party of the first part hereby covenants and agrees with the party of the second part that any improvements in said reheating apparatus which may be made by the party of the first part or its assignors or, in which the party of the first part may acquire assignable rights, may be adopted by the party of the second part and applied to reheating apparatus made, used or sold by it under and during the continuance of this agreement; subject, however, to all the terms and conditions of this agreement, but without the payment of any royalties or license fees in addition to those hereinafter recited.
VI. The party of the second part covenants and agrees that it will use due and reasonable diligence in the making of the experiments above referred to, in the adapting of the patented devices to its locomotives, and in the commercial manufacture, use and sale as above provided of apparatus embodying the patented improvements and designed for the carrying out of the patented methods; that it will keep, or cause to be kept, proper books of account, in which shall be entered the whole number of apparatuses made under and in accordance with this agreement and a full and accurate description thereof, and that such books shall at all times during business hours and upon request to be open to inspection by the party of the first part or its duly authorized agent or attorney.
VII. The party of the second part further covenants and agrees that after the expiration of the said experimental period of one year from the date hereof as above provided, it will well and truly pay to the party of the first part, or to such person or concern as the party of the first part may in writing designate, a royalty on all reheating apparatus thereafter made by the party of the second part and embodying the said patented improvements or designed for the carrying out of the patented methods, as follows:
On each and every locomotive for traction purposes, exclusive of street railroad use, having cylinders not more than eight inches in diameter, one hundred dollars ($100)
On each and every locomotive for traction purposes, exclusive of street railroad use, having cylinders less than eleven inches in diameter and more than eight inches in diameter, one hundred and fifty dollars ($150).
On each and every locomotive for traction purposes, exclusive of street railroad use, having cylinders eleven inches in diameter or over, two hundred and fifty dollars ($150),
Provided, however, that in the event that the manufacture, use and sale of apparatus equipped with reheaters embodying the patented improvements or designed for carrying out the patented methods commences before the expiration of the said experimental period of one year, the royalties as above shall be well and truly paid on all of such apparatus. The party of the second part shall account for and pay to the party of the first part, on the fifteenth days of January, April, July, and October, all royalties payable on locomotives made and sold by it under this license for the quarter ending with the last day of the preceding month.
VIII. It is further agreed by and between the parties hereto that unless the minimum sum to be paid shall during the first year in which royalties are payable amount to at least one thousand dollars ($1,000), and unless the minimum sum to be paid during the second and each succeeding year in which said royalties are payable as above specified shall amount to at least two thousand dollars ($2,000) for each and ever year, the exclusive right and license herein granted shall cease and terminate, and the party of the first part shall be at liberty to grant to other persons, firms and corporations similar rights and licenses to use and practice the said patented inventions. It is understood and agreed however, by and between the parties hereto, that in the event of the termination of the exclusive license above provided by the failure of the party of the second part shall be deemed to have a non-exclusive license to manufacture, use, sell and practice the said inventions upon the payment to the party of the first part of the royalties above provided and in connection only with locomotive for traction purposes exclusive of street railroad use, and so long as it does not entirely abandon such manufacture.
IX. It is further mutually covenanted and agreed by and between the parties hereto that this license is personal to the party of the second part, is non-assignable, and is limited to the manufacture of the patented apparatus at the shops of the part of the second part at Pittsburgh, Pennsylvania, and not elsewhere, and in connection with locomotives, and only i connection therewith for traction purposes exclusive of street railroad use.
IN WITNESS WHEREOF the parties above named have hereto set their hands and seals the day and year first above written.
Edison Saunders Compressed Air Co
W.S. Mallory
Thomas A. Edison
Prescott
H.K. Porter Co.
witness W.S. Thomas State of New Jersey,
County of Essex,
I, a Notary public do certify that personally appeared before me, and being by me duly sworn did depose and say that he is the president of the EDISON-SAUNDERS COMPRESSED AIR Company described in the foregoing license agreement, and authorized by said corporation to execute and acknowledge deeds and other writings of said corporation, and that the seal affixed to said license agreement was signed and sealed by him in behalf of said corporation, and the said acknowledged said license agreement to the act and deed of said corporation.
Given under my hand ad seal this day of January 1901 State of New Jersey,
County of Essex,
I, H.S. Thomas a Notary public do certify that H.K. Porter personally appeared before me, and being by me duly sworn did depose and say that he is the president of the EDISON-SAUNDERS COMPRESSED AIR Company described in the foregoing license agreement, and authorized by said corporation to execute and acknowledge deeds and other writings of said corporation, and that the seal affixed to said license agreement was signed and sealed by him in behalf of said corporation, and the said H.K. Porter acknowledged said license agreement to the act and deed of said corporation.
Given under my hand and seal this first day of February 1901
W.S. Thomas
Notary Public

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