HPQ Purevap QRR , Nano and Polvere royalty structure For absolute simple layman terms:
It's basically Pyrogenesis own 10% royalty of Purevap QRR with NO conversion option. HPQ is exclusive rights to anything related to silicon related to Purevap QRR and has first right of refusal on other applications.
Pyrogenesis owns 10% royalty of Purevap Nano and Polvere which can be converted at to 50% equity.
HPQ NANO:
PyroGenesis will retain a royalty-free, exclusive, irrevocable worldwide license to use the process for purposes other than the production of Micron size and Nano size Silicon Powders and Silicon Nanowires. Should PyroGenesis be approached by any other parties for any research and development or commercial purposes outside of the Field, HPQ NANO shall have a right of first refusal, provided that, however, HPQ NANO exercise its right of first refusal within thirty (30) days of PyroGenesis receiving a bona-fide offer.
NSIR REVENUES SPLIT BETWEEN HPQ NANO AND PYROGENESIS FROM SALES OF NANO SI MATERIALS HPQ and PyroGenesis evaluated the short and long-term advantages of forming, at the start, a standalone joint venture responsible for manufacturing and selling Nanoscale Silicon (Si) powders.
A gradual approach was deemed more efficient, therefore HPQ Silicon created a fully own subsidiary, HPQ NANO Silicon Powders Inc, to be the stand-alone Corporation that would finance the Research and Development programs and manage the future commercialisation of Nanoscale Silicon (Si) materials made with the PUREVAPTM NSiR with PyroGenesis being granted the right to convert, at any time and at its sole discretion, it Royalty into a 50% equity stake in HPQ NANO.
As a result of this, HPQ NANO agrees to pay PyroGenesis, on an annual basis, and until conversion, the following minimum royalty (Nano-Royalty) on the gross sales of nano materials produced with the PUREVAPTM NSiR Process and Systems:
For 2021, the greater of 10% of HPQ NANO gross sales or fifty thousand dollars (CDN$50,000); 4 | Page
For 2022, the greater of 10% of HPQ NANO gross sales or one hundred thousand dollars (CDN$100,000);
For 2023, the greater of 10% of HPQ NANO gross sales or one hundred and fifty thousand dollars (CDN$150,000);
For 2024 and beyond, the greater of 10% of HPQ NANO gross sales or two hundred thousand dollars (CDN$200,000).
HPQ POLVERE:
PyroGenesis will retain a royalty-free, exclusive, irrevocable worldwide license to use the process for purposes other than the production of Fumed Silica (Pyrogenic Silica). Should PyroGenesis be approached by any other parties for any research and development or commercial purposes outside of the Field, HPQ POLVERE shall have a right of first refusal, provided that, however, HPQ POLVERE exercise its right of first refusal within thirty (30) days of PyroGenesis receiving a bona-fide offer.
As with all our other transactions with PyroGenesis, HPQ POLVERE agrees to pay PyroGenesis, on an annual basis, a minimum royalty (Pyrogenic Silica Royalty), with PyroGenesis being granted the right to convert, at any time and at its sole discretion, its Royalty into a 50% equity stake in HPQ POLVERE.
As a result of this, HPQ POLVERE agrees to pay PyroGenesis, on an annual basis, and until conversion, the following minimum royalty (Pyrogenic Silica Royalty), on the gross sales of Pyrogenic Silica, excluding samples and testing products, produced with any Systems incorporating the Reactor and Process IP and/or the Optioned Rights:
- For 2023, the greater of 10% of HPQ POLVERE gross sales or fifty thousand Canadian dollars (CDN$50,000),
- For 2024, the greater of 10% of HPQ POLVERE gross sales or one hundred thousand Canadian dollars (CDN$100,000),
- For 2025, the greater of 10% of HPQ POLVERE gross sales or one hundred and fifty thousand Canadian dollars (CDN$150,000),
- For 2026 and beyond, the greater of 10% of HPQ POLVERE gross sales or two hundred thousand Canadian dollars (CDN$200,000).