EXHIBIT 10.6
PATENT ASSIGNMENT AGREEMENT
This Patent Assignment Agreement ("Agreement"), dated as of May 30,
1996, is entered into by and among Xxxxxx X. Xxxxxxxxx ("Xx. Xxxxxxxxx"), and
NetSource International Telecommunications, Inc. (formerly known as MTC
Telecommunications, Inc.), a Delaware corporation ("NetSource").
RECITALS
WHEREAS, Xx. Xxxxxxxxx researched, developed and owns the patents
identified in Exhibit A;
WHEREAS, Xx. Xxxxxxxxx has previously, orally granted to MTC (as
defined below) a non-exclusive right to use the patents for purposes described
herein; and
WHEREAS, the parties now desire to enter into a definitive written
agreement to confirm the prior grant by Xx. Xxxxxxxxx to MTC of a non-exclusive
right to use the patents, and for the irrevocable assignment by Xx. Xxxxxxxxx of
his right to and interest in the patents to NetSource.
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
Definitions
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As used in this Agreement, the following terms shall have the
following meanings:
SECTION 1.1. Agreement. "Agreement" shall mean this Patent
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Assignment Agreement, including any amendments thereto.
SECTION 1.2. Assigned Patents. "Assigned Patents" shall mean and
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include all patents set forth on Exhibit A attached hereto and any and all
continuations, divisional and continuation-in-part applications based thereon,
and all patents issuing thereon, including reissues, patents of addition and
extensions thereof.
SECTION 1.3. Licensed Products. "Licensed Products" shall mean any
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products or services to be manufactured or sold using the Licensed Patents,
including without limitation, the product currently offered and sold by MTC, MTC
Sales Affiliates and MTC International, Inc. under the name "Passport".
SECTION 1.4. MTC. "MTC" shall mean MTC Telemanagement Corporation, a
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California corporation, and its affiliate, MTC International, Inc., and their
successors and assigns.
SECTION 1.5. MTC Sales Affiliates. "MTC Sales Affiliates" shall mean
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the persons or entities who from time to time offer to sell MTC services and
products pursuant to an agreement or license with MTC.
ARTICLE II
Assignment of Patent
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SECTION 2.1. Confirmation of Oral Grant. Xx. Xxxxxxxxx hereby
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confirms his previous oral grant to MTC, of a nonexclusive license to the
Assigned Patents, which included the right to sublicense to any subsidiary,
parent or affiliate of MTC or to MTC Sales Affiliates, and to make, use and sell
or otherwise dispose of the Licensed Products.
SECTION 2.2. Assignment of Rights. Xx. Xxxxxxxxx hereby irrovacably
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assigns all of his right, title and interest in and to the Assigned Patents to
NetSource under this Agreement. Nothing contained herein shall be construed as
a license to or other grant, express or implied, under any other patents owned
or controlled by Xx. Xxxxxxxxx.
SECTION 2.3. Assumption of Rights. NetSource hereby accepts the
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assignment of all of Xx. Xxxxxxxxx'x right, title and interest in and to the
Assigned Patents.
ARTICLE III
Consideration for Oral License and Assignment
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SECTION 3.1. Cash Royalty In Exchange for Assignment. In exchange for
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the previous oral grant of the license and the assignment of the Assigned
Patents referred to Sections 2.1 and 2.2 respectively, NetSource hereby agrees
(a) to ratify all prior payments by MTC which commenced on January 1, 1994 and
ended on or about May 1, 1996 in the aggregate amount of four hundred and ten
thousand dollars ($410,000) and (b) to ratify the payment by MTC of all legal
and related patent registration expenses in the amount of sixty one thousand
five hundred twenty nine and 12/100 dollars ($61,529.12) incurred in connection
with the Assigned Patents.
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ARTICLE IV
Representations and Warranties of Envoy
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NetSource represent and warrant to Xx. Xxxxxxxxx as follows:
SECTION 4.1. Corporate Existence. NetSource is a corporation duly
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organized, validly existing and in good standing under the laws of the State of
Delaware.
SECTION 4.2. Authority. NetSource has full power and authority to
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enter into this Agreement and to carry out the transactions contemplated hereby.
NetSource has taken all action required by law and the NetSource charter
documents to authorize the execution, delivery and performance by NetSource of
this Agreement and the transactions contemplated hereby. This Agreement is a
legal, valid and binding agreement of NetSource, enforceable against NetSource
in accordance with its terms.
SECTION 4.3. No Violation. Neither the execution and delivery of
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this Agreement nor the consummation of any of the transactions contemplated
hereby will violate any provisions of NetSource's articles of incorporation or
bylaws or violate, or be in conflict with, or constitute a default under, or
cause the acceleration of the maturity of any debt or obligation pursuant to, or
result in the creation or imposition of any security interest, lien or other
encumbrance upon any property or assets of NetSource under, any agreement or
commitment to which NetSource is a party or by which NetSource is bound, or
violate any statute or law or any judgment, decree, order, regulation or rule of
any court or governmental authority.
ARTICLE V
Representations and Warranties of Xx. Xxxxxxxxx
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Xx. Xxxxxxxxx represents and warrants to NetSource as follows:
SECTION 5.1. Capacity. Xx. Xxxxxxxxx has full legal capacity and
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authority to enter into this Agreement and carry out the transactions
contemplated hereby. This Agreement is a legal, valid and binding agreement by
Xx. Xxxxxxxxx, enforceable against Xx. Xxxxxxxxx in accordance with its terms.
SECTION 5.2. No Violation. Neither the execution and delivery of
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this Agreement nor the consummation of any of the transactions contemplated
hereby will violate any provision of or violate or be in conflict with, or
constitute a default under, or cause the acceleration of the maturity of any
debt or obligation pursuant to, any agreement or commitment to which Xx.
Xxxxxxxxx, to his knowledge, is a party or by which Xx. Xxxxxxxxx, to his
knowledge, is bound, or violate any statute or law, or any judgment, decree,
order, regulation or rule of any court or governmental authority.
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SECTION 5.3. Title. Xx. Xxxxxxxxx has good and valid title to the
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Assigned Patents.
SECTION 5.4. Patents. Xx. Xxxxxxxxx has the sole and exclusive right
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to use and license the inventions described in the Assigned Patents, and the
Assigned Patents are free and clear of all liens, claims, charges, security
interests, covenants, reservations, restrictions or other encumbrances and the
consummation of the transactions contemplated hereby will not alter or impair
any such rights. No claims have been asserted by any person that challenge the
validity or enforceability of any Assigned Patents and there is no valid basis
for any such claim or of any prior art or other facts that would render any of
the Assigned Patents invalid; and the use of the Assigned Patents by NetSource
as may be contemplated by this Agreement will not infringe on the rights of any
person. There is no existing or threatened claim by the Xx. Xxxxxxxxx against
others for infringement, misuse or misappropriation of any patent, trade secret
or know-how relating to the Assigned Products. Xx. Xxxxxxxxx is not infringing,
misusing or misappropriating any trade secret or know-how owned by any third
party relating to the Assigned Patents.
SECTION 5.5. No Other Agreements. Xx. Xxxxxxxxx is not a party to
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any agreement, license or other commitment relating to the Assigned Patents
which would impair the value of the benefits granted hereunder to NetSource.
ARTICLE VI
Limitation of Liability
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SECTION 6.1. Limitation of Liability. IN NO EVENT SHALL MR.
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BRINSKELE BE LIABLE TO NETSOURCE UNDER THIS AGREEMENT FOR ANY SPECIAL, INDIRECT,
INCIDENTAL OR CONSEQUENTIAL DAMAGES, WHETHER BASED ON BREACH OF CONTRACT, TORT
(INCLUDING NEGLIGENCE, PRODUCT LIABILITY, OR OTHERWISE), INCLUDING WITHOUT
LIMITATION ANY LOSS RESULTING FROM USE OF THE ASSIGNED PATENTS OR LICENSED
PRODUCTS OR ANY LOSS OF ANY KIND, HOWEVER CAUSED, EVEN IF XX. XXXXXXXXX KNOWS,
HAS REASON TO KNOW, OR HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. IN
NO EVENT SHALL XX. XXXXXXXXX'X LIABILITY ARISING OUT OF THIS AGREEMENT EXCEED
THE AGGREGATE CONSIDERATION SET FORTH IN SECTION AND 3.1.
SECTION 6.2. No Other Warranties. Except for the limited warranty
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set forth above, NetSource agrees that the Assigned Patents are furnished on an
"As-Is" basis. XX. XXXXXXXXX MAKES NO OTHER WARRANTIES OF ANY KIND, EITHER
EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING WITHOUT LIMITATION
THE CONDITION, MERCHANTABILITY, OR FITNESS FOR ANY PARTICULAR PURPOSES OF THE
ASSIGNED PATENTS. XX. XXXXXXXXX DOES NOT WARRANT THAT THE ASSIGNED PATENTS WILL
MEET NETSOURCE'S REQUIREMENTS, THAT IT WILL OPERATE IN THE COMBINATIONS WHICH
NETSOURCE MAY SELECT, OR THAT ITS OPERATION WILL BE UNINTERRUPTED OR ERROR
FREE. MR.
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BRINSKELE DOES NOT ASSUME ANY LIABILITY REGARDING USE OF, OR ANY DEFECT IN, THE
ASSIGNED PATENTS.
ARTICLE VII
Infringement
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SECTION 7.1. Cooperation and Defense. The parties shall cooperate in
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good faith to redress any threatened or actual unauthorized use or infringement
of the Assigned Patents by third parties; provided that NetSource shall be
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obligated, at its sole cost and expense, to initiate and pursue in good faith
legal proceedings and other actions so as to protect the Assigned Patents
against third-party infringement and Xx. Xxxxxxxxx shall assist NetSource in
such activities.
SECTION 7.2. Notification. Each party shall promptly notify the
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other party in writing of any such actual or threatened third party
infringement.
ARTICLE VIII
Dispute Resolution
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SECTION 8.1. Choice of Law; Waivers. THIS AGREEMENT SHALL BE
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INTERPRETED IN ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE CONFLICT OF LAWS
RULES) OF THE STATE OF CALIFORNIA GOVERNING CONTRACTS TO BE PERFORMED ENTIRELY
WITHIN SUCH STATE. WITH RESPECT TO ANY CLAIMS RELATING TO OR ARISING FROM THIS
AGREEMENT: THE PARTIES HEREBY CONSENT TO THE EXCLUSIVE JURISDICTION OF ANY STATE
COURT LOCATED WITHIN THE COUNTY OF SONOMA, THE STATE OF CALIFORNIA; THE PARTIES
WAIVE ANY OBJECTION OF FORUM NON CONVENIENS AND VENUE; THE PARTIES WAIVE
PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT OR THEM, AND CONSENT THAT ALL
SUCH SERVICE OF PROCESS BE MADE IN THE MANNER SET FORTH IN SECTION 9.3 HEREOF
FOR THE GIVING OF NOTICE; AND THE PARTIES FURTHER WAIVE ANY RIGHT THEY MAY
OTHERWISE HAVE TO COLLATERALLY ATTACK ANY JUDGMENT ENTERED AGAINST THEM.
SECTION 8.2. Specific Enforcement. The parties hereby acknowledge
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and agree that each would be irrevocably damaged in the event that any of the
provisions of this Agreement are not performed or are otherwise breached. It is
accordingly agreed that each party shall be entitled to an injunction or
injunctions to prevent breaches or threatened breaches of this Agreement by any
other party and to specifically enforce this Agreement and the terms and
provisions hereof against such other parties, in addition to any other remedy to
which such aggrieved party may be entitled at law or in equity, and without
being required to post bond or other security and without having to prove the
inadequacy of the other available remedies at law.
SECTION 8.3 Arbitration. BY EXECUTING THIS AGREEMENT, THE
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PARTIES ARE AGREEING TO HAVE ANY MATTER WHICH IS THE SUBJECT OF ARBITRATION
PURSUANT TO THIS SECTION 8.3 DECIDED BY NEUTRAL ARBITRATION AS PROVIDED BY
CALIFORNIA LAW AND ARE GIVING UP ANY RIGHTS THEY MIGHT POSSESS TO HAVE THE
DISPUTE LITIGATED IN A COURT OR JURY TRIAL. BY EXECUTING THIS AGREEMENT, THE
PARTIES ARE GIVING UP JUDICIAL RIGHTS TO DISCOVERY AND APPEAL, UNLESS SUCH
RIGHTS ARE SPECIFICALLY INCLUDED IN THE ARBITRATION PROVISION; IF ANY OF THE
PARTIES REFUSES TO SUBMIT TO ARBITRATION IT MAY BE COMPELLED TO ARBITRATE UNDER
THE CALIFORNIA CODE OF CIVIL PROCEDURE. A PARTY'S AGREEMENT TO THIS ARBITRATION
PROVISION IS VOLUNTARY. BY EXECUTING THIS AGREEMENT, EACH OF THE PARTIES
ACKNOWLEDGES THAT IT HAS READ AND UNDERSTOOD THE FOREGOING AND HAS AGREED TO
SUBMIT DISPUTES ARISING OUT OF MATTERS INCLUDED IN THIS SECTION 8.3 TO NEUTRAL
ARBITRATION. Any controversy or claim arising out of or relating to this
Agreement or the breach hereof shall be settled by arbitration, which
arbitration shall be conducted as follows: A party seeking arbitration shall
promptly send notice of arbitration to the other party. The place of arbitration
hereunder shall be Petaluma, California. Within thirty (30) days of the date of
such notice, the parties shall appoint one neutral arbitrator. The mutually
acceptable neutral arbitrator shall be selected from the panel of arbitrators at
JAMS/Endispute and the arbitrator shall be a duly qualified professional with at
least five years of experience in the field of Intellectual Property law. The
arbitrator shall determine all issues presented, and the decision and award of
such arbitrator shall be binding and conclusive upon the parties hereto and
shall be enforceable in a court having jurisdiction over the parties. The Rules
of JAMS/Endispute for complex commercial arbitration shall be applied to any
arbitration hereunder as to all matters of procedure, provided, however, that
the parties may obtain discovery in aid of the arbitration. Arbitration costs
shall be borne by the losing party in arbitration, or if the arbitration
produces no clear loser, equally by the parties to such claim or controversy,
except that each party shall be responsible for its own expenses and costs of
any witnesses selected by such party.
SECTION 8.4. Attorneys' Fees and Expenses. If any arbitration or
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judicial proceedings shall be commenced to enforce this Agreement, the
prevailing party(ies) in such proceedings shall be entitled to recover the
reasonable attorneys' fees, costs and expenses incurred by such prevailing party
in connection with such proceedings from the losing party.
ARTICLE IX
Miscellaneous
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SECTION 9.1. Amendment and Modification. Subject to applicable law,
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this Agreement may only be amended, modified or supplemented by written
agreement of the parties.
SECTION 9.2. Waiver of Compliance. Any failure of any party, to
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comply with any obligation, covenant, agreement or condition herein may be
expressly waived in writing by NetSource or Xx. Xxxxxxxxx, as the case may be,
but such waiver or failure to insist upon strict
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compliance with such obligation, covenant, agreement or condition shall not
operate as a waiver of, or estoppel with respect to, any subsequent or other
failure to comply with this Agreement.
SECTION 9.3. Notices. All notices, requests, demands and other
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communications required or permitted hereunder shall be in writing and shall be
deemed to have been duly given if delivered by hand, telecopied (with receipt
confirmed), sent by overnight courier service or mailed, by certified or
registered mail:
(a) If to Xx. Xxxxxxxxx, to:
0000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
or to such other person or address as Xx. Xxxxxxxxx shall furnish to NetSource
in writing.
(b) If to NetSource, to:
0000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
or to such other person or address as NetSource shall furnish to Xx. Xxxxxxxxx
in writing.
SECTION 9.4. Severability. If any term or provision of this
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Agreement or the application thereof to any party, person or circumstance shall,
to any extent, be invalid or unenforceable, the remainder of this Agreement, or
the application of such term or provision to any party, person or circumstance
other than those as to which it is held invalid or unenforceable, shall not be
affected thereby, and each term and provision of this Agreement shall be valid
and be enforced to the fullest extent permitted by law.
SECTION 9.5. Counterparts. This Agreement may be executed
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simultaneously in counterparts, each of which shall be deemed an original, but
both of which together shall constitute one and the same instrument.
SECTION 9.6. Headings. The headings of the Articles and sections of
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this Agreement are inserted for convenience only and shall not constitute a part
hereof or affect in any way the meaning or interpretation of this Agreement.
SECTION 9.7. Entire Agreement. This Agreement, including Schedule A
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attached hereto, and any other documents and certificates delivered pursuant to
the terms hereof, set forth the entire agreement and understanding of the
parties hereto in respect of the subject matter contained herein, and supersede
all prior agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written, by any officer, employee
or representative of any party hereto.
SECTION 9.8. Third Parties. Nothing contained herein shall be
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construed to confer upon or give to any person or corporation, other than the
parties hereto and their successors or permitted assigns, any rights or remedies
under or by reason of this Agreement.
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SECTION 9.9. Construction. This Agreement shall be construed as to
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its fair meaning and not strictly for or against either party.
IN WITNESS WHEREOF, the parties hereto acknowledge that they have
consulted with individual counsel and they knowingly and willingly enter into
this agreement and have caused their duly authorized officers to execute this
Agreement on their behalf.
/s/ Xxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxxxxxx
NETSOURCE INTERNATIONAL
TELECOMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxx
Title: Chief Executive Officer and President
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Exhibit A
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Description of Patents
Patent No. 5,425,084 Computer-controlled Telecommunications System granted
6/13/95, and all foreign counterparts and all
continuations and continuations in part of this patent.
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