Exhibit 10.33
ROYALTY AGREEMENT
THIS ROYALTY AGREEMENT ("Royalty Agreement") is made as of October 1,
2001, by and between INTERACTIVE INTELLIGENCE, INC., an Indiana corporation (the
"Company"), and Xxxxxx X. Xxxxxxx ("Xxxxxxx").
RECITALS
1. Company and Xxxxxxx are parties to that certain Stock Purchase
Agreement by and among Xxxxxxx, Xxxxxx X. Xxxxx, M.D. ("Xxxxx") and the Company,
dated of even date herewith (the "Purchase Agreement"), pursuant to which the
Company is purchasing all shares of stock of Interactive Portal, Inc. ("Portal")
owned by Xxxxx and Xxxxxxx.
2. Xxxxx and Xxxxxxx are the only shareholders of Portal other than the
Company. The Company's purchase pursuant to the Purchase Agreement will make
Portal a wholly-owned subsidiary of the Company.
3. Pursuant to the Purchase Agreement, Company has agreed to pay
Xxxxxxx certain royalties on future sales of the "Service Interaction Center"
and "Communite" products (the "Products") by the Company.
AGREEMENT
In consideration of the mutual covenants and conditions set forth in
the Purchase Agreement and of the foregoing Recitals and the mutual undertakings
herein, the sufficiency of such consideration being hereby acknowledged, Company
and Xxxxxxx agree as follows:
1. The term of this Royalty Agreement shall commence on October 1, 2001
and shall continue until December 31, 2004 (the "Term").
2. Company shall have the exclusive right to produce or have produced,
market, distribute, and/or sell the Products at Company's sole discretion.
3. Company shall pay Xxxxxxx a royalty in the amount equal to the sum
of sixty-two hundredths percent (.62%) of the gross revenues to the Company, net
of reseller discounts, from sales or licenses of the Products during the Term of
this Royalty Agreement. Sales or licenses among Company, its affiliates and its
subsidiaries shall be disregarded for purposes of computing any royalties under
this Royalty Agreement. In the event the Company sells or licenses the Products
together with other products of the Company, the portion of the total sales
price or license fee received by the Company shall be allocated between the
Products and the other products of the Company based on their respective list
prices. Royalties shall be paid in thirteen quarterly payments on February 1,
May 1, August 1 and November 1 of each year, commencing February 1, 2002 for
sales of Products during the Term of this Agreement. For purpose of this Royalty
Agreement, a "sale" or "license" shall be deemed to be made on receipt of cash
payment by the Company from a customer. Any unpaid royalty payments which are
not paid shall thereafter bear interest at the rate of eight percent (8%) per
year. All amounts due hereunder shall be payable in United States Dollars. When
the Products are sold or licensed for monies other than
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United States Dollars, the earned royalties will first be determined in the
foreign currency of the country in which the Products were sold or licensed and
then converted into equivalent United States Dollars. The exchange rate will be
the United States Dollar buying rate quoted in the Wall Street Journal on the
day of sale or license. Company shall be responsible for any and all taxes,
fees, or other charges imposed by the government of any country outside the
United States on the remittance of royalty income for sales or licenses
occurring in any such country.
4. During the Term of this Royalty Agreement, Company will provide
quarterly reports to Xxxxxxx within thirty (30) days of the end of each quarter
reporting sales or licenses of the Products. Each such report shall cover
Company's most recently completed calendar quarter and will show (a) the units
of each of the Products sold or licensed along with the price per unit; (b) the
royalties, in U.S. dollars, payable hereunder with respect to such sales or
licenses; (c) the method used to calculate the royalty; and (d) the exchange
rates used, if any.
5. Company shall keep books and records in accordance with generally
accepted accounting principles accurately showing all sales, licenses and
information relating to this Royalty Agreement. Such books and records shall be
preserved for at least two (2) years following the date of termination of this
Royalty Agreement.
6. Xxxxxxx may inspect all of Company's books and records pertaining to
sales and licenses of the Products at the Company's office during normal
business hours upon giving Company reasonable notice. The fees and expenses of
Xxxxxxx'x representatives performing such an examination shall be borne by
Xxxxxxx. However, if an error in royalties of more than five percent (5%) of the
total royalties due for any year is discovered, then the fees and expenses of
these representatives shall be borne by the Company.
7. This Royalty Agreement shall be binding on, inure to the benefit of,
and may be enforced by, both Company and its successors and assigns, and Xxxxxxx
and his successors and assigns. The rights and obligations under this Royalty
Agreement are nontransferable and nonassignable by Xxxxxxx without prior written
consent of the Company, which consent shall not be unreasonably withheld. The
Company may freely transfer or assign its rights and obligations under this
Royalty Agreement.
8. Any written notices and/or royalty payments shall be deemed duly
given and effective: (i) on the date of delivery, if delivered personally or by
courier or overnight mail; (ii) on the earlier of the fourth (4th) day after
mailing or the date of the return receipt acknowledgment, if mailed, postage
prepaid, by certified or registered mail, return receipt requested; or (iii) on
the date of transmission, if sent by facsimile or similar telegraphic
communications equipment; to such party at the following address or, as
applicable, facsimile number:
If to Company: Interactive Intelligence, Inc.
0000 Xxxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Controller
Facsimile: (000) 000-0000
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If to Xxxxxxx: Xxxxxx X. Xxxxxxx
0000 Xxxxxxx Xxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
or to such other address as either party may specify by notice to the other.
9. This Royalty Agreement may not be amended, supplemented, or modified
except by a written document which references this Royalty Agreement and which
is signed by both Company and Xxxxxxx.
10. If any provision of this Royalty Agreement is determined by a court
of competent jurisdiction to be invalid, all other provisions shall remain in
full force and effect.
11. Waiver by either party of any breach of any provision of this
Royalty Agreement shall not operate or be construed as a waiver of any
subsequent or other breach.
12. This Royalty Agreement shall be governed by and construed in
accordance with the laws of the State of Indiana applicable to agreements made
and performed in Indiana and any legal action or proceeding between Company or
Xxxxxxx relating to or arising out of this Royalty Agreement shall be brought
exclusively in a federal or state court of competent jurisdiction sitting in
Xxxxxx County, Indiana.
13. This Royalty Agreement may be executed in two or more counterparts,
each of which shall constitute an original, but all of which when taken together
shall constitute but one agreement.
IN WITNESS WHEREOF, Company has submitted its signature through its
authorized representative, and Xxxxxxx has submitted his signature in his
individual capacity.
INTERACTIVE INTELLIGENCE, INC.
By /s/ Xxxxxxx X. Xxxxxx /s/ Xxxxxx X. Xxxxxxx
-------------------------------- ---------------------------
Xxxxxx X. Xxxxxxx
Its: Senior VP & CEO "Xxxxxxx"
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("Company")
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