MANUFACTURING LICENSE AND DISTRIBUTION AGREEMENT
THIS MANUFACTURING LICENSE AND DISTRIBUTION AGREEMENT ("Agreement") is made as
of the latter of the signature dates below (the "Effective Date"), by and
between Motorola, Inc., a corporation organized and existing under the laws of
the State of Delaware, U.S.A., by and through its Multiservice Networks Division
("MND"), with an office located at 00 Xxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000,
("Motorola"), and Telenetics Corporation with offices at 00000 Xxxxxx Xxxxx,
Xxxx Xxxxxx, Xxxxxxxxxx 00000 ("Licensee").
RECITALS
--------
WHEREAS, Motorola has designed, developed, and manufactured certain legacy and
transmission products which are set forth on Appendix A hereto (each a "Product"
and together the "Products"), and distributes such Products under a Motorola
brand name directly and indirectly for sale to its customers around the world;
and
WHEREAS, Licensee currently distributes data communication products and desires
to acquire the rights to continue manufacturing and marketing the Products under
Licensee's own brand name; and
WHEREAS, Motorola agrees to license to Licensee those rights related to the
Licensed Material as are necessary to manufacture, market and sell the Products
under the terms and conditions of this Agreement and to provide Licensee with
related, materials, parts lists, schematic diagrams, electronics files, test
fixtures, case molds, components, spare boards, software, source code,
homologation files, published and electronic marketing documents including
datasheets, application notes, brochures, product manuals, web pages and other
similar materials, test and repair equipment, technical information, data,
designs, drawings and technical knowledge with respect to designing,
engineering, marketing, constructing, applying and fabricating and shipping said
Products, but specifically excluding 6500Plus software and source code
("Licensed Material"); and
WHEREAS, Licensee wishes to manufacture and distribute the Products utilizing
the Licensed Material and rights provided by Motorola hereunder; and
WHEREAS, Motorola and Licensee agree that the per-product payments provided in
Section 2 of this Agreement and the other consideration as otherwise stated
herein are in exchange for the Licensed Material and rights granted by Motorola
and for the referral of customers by Motorola, and that the per-product payment
formula is endorsed by both parties for mutual convenience in calculating a fair
compensation for these benefits.
NOW, THEREFORE, in consideration of the mutual promises and covenants contained
in this Agreement, and other consideration, the sufficiency of which is hereby
mutually acknowledged, the parties hereto agree as follows:
1.0 SCOPE
-----
This Agreement establishes the terms and conditions under which
Motorola shall license to Licensee the right to manufacture and sell a
Licensee-branded version of the Products and transfer to Licensee those
inventories and other Licensed Materials such as are required to
manufacture the Products. The Products are further described in
Appendix A attached hereto. At any time during the term of the
Agreement, the parties may identify additional Products to be licensed
hereunder and governed by the terns and conditions set forth in this
Agreement. In such event, the parties shall mutually agree upon
specifications for such additional products, amend the Agreement in
writing and add the additional Products to Appendix A.
2.0 PER-PRODUCT PAYMENTS, INVENTORY AND PRODUCTION EQUIPMENT
--------------------------------------------------------
Licensee shall pay to Motorola monthly royalty payments on the first
(1st) day of the second month following the full or partial calendar
quarter of product sales, in the amounts set forth on Appendix A hereto
(Example: Royalties for January, February, & March would be due on May
1).
Upon prior notice to Licensee, Motorola shall have the right to audit
or have an independent accounting firm audit such reports and payments.
In the event of any underpayment, Licensee shall promptly issue to
Motorola payment for the difference owed. In the event of an
overpayment due to an accounting error, Motorola shall promptly refund
to Licensee any excess royalties received. Motorola and Licensee agree
that the per-product payments set forth on Appendix A and the other
consideration as otherwise stated herein are in exchange for the
Licensed Material and rights granted by Motorola and for the referral
of customers by Motorola, and that the per-product payment formula is
endorsed by both parties for mutual convenience in calculating a fair
compensation for these benefits.
2.1 Inventory. Motorola agrees to sell to Licensee and Licensee agrees to
purchase from Motorola certain inventories related to the Products in
accordance with the terms set forth below. These inventories include
components, and other raw materials, sub-assemblies, and finished
goods.
2.1.1 Licensee agrees to issue a purchase order to Motorola for inventories,
on-hand either at Motorola or at Motorola's Contract Manufacturer(s),
used for the ongoing manufacturing of the Products. Licensee and
Motorola will, at an agreed upon date (December), conduct a physical
inventory count of the inventories. In addition, Licensee and Motorola
will review all open purchase orders that the Contract Manufacturer(s)
may have in place. A joint analysis of the physical inventory, open
purchase orders and expected material consumption before December 29,
2000, will yield an excess inventory that Licensee agrees to purchase.
(The excess inventory is expected to be in the range of $5-$8 million.)
Motorola sells such inventories to Licensee FOB Motorola's (or
Motorola's Contract Manufacturer's) shipping dock.
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Licensee agrees on December 29, 2000 to make a down payment to Motorola
for 25% of the above excess inventory, and simultaneously to issue a
purchase order for the balance of the excess inventory. The balance of
the payment for the excess inventory will be divided equally into three
(3) payments, with the first payment due January 31, 2001, the second
due February 28, 2001, and the third due on March 31, 2000. If Licensee
makes payment in full for the excess inventory by December 29, 2000,
then Motorola will grant a fifteen percent (15%) payment discount.
Motorola agrees to transfer the excess inventory to Licensee before
January 15, 2001. Motorola agrees that Licensee is not required to
purchase excess inventory that would not be consumed in a twenty four
(24) month period commencing January 1, 2001. Motorola reserves the
right and hereby notifies Licensee that it will likely scrap this
excess inventory if Licensee does not purchase this inventory before
December 29, 2000. Motorola is willing to enter into negotiations for
the purchase of excess inventory that would not be consumed in twenty
four (24) months.
2.2.1 Motorola has received and disclosed to Licensee end-of-life notices
regarding certain components of Motorola's 3460 and 326X modem Product
families. Licensee agrees that Licensee shall be responsible for
negotiating a last-buy agreement and order with the respective
component manufacturers. Motorola as a party to these negotiations
shall lend all reasonable assistance to Licensee in obtaining a
last-buy agreement with the respective manufacturers. In the event that
Licensee is unable to reach satisfactory arrangements with the
component manufacturers, Licensee shall have no obligation to
manufacture or supply the 3460 and 326X product lines as described in
paragraph 4.3.
2.2.2 Production Equipment. Licensee agrees to issue to Motorola a purchase
order dated December 29, 2000, for all production equipment, assembly
and test equipment which is currently required for manufacturing,
applying and fabricating, testing and shipping the Products as listed
in Appendix D ("Production Equipment"), at the agreed upon fair market
values listed in Appendix D. These items include, but are not limited
to, production assembly and test equipment owned by Motorola which is
currently located at ACT Manufacturing, all equipment in the 6500 Plus
work cell currently located at Solectron Corporation, Case Molds
currently located at various suppliers and any other similar
production, test and repair equipment, fixtures, tooling, and any other
Motorola materials which are currently used by either Motorola or its
vendors and contractors to manufacture and supply the Products. Payment
for the Production Equipment will be divided equally and made over a
subsequent twelve (12) month period finishing no later than December
31, 2001. (Example: Value of Production Equipment = $600,000; payments
= $600,000/12 = $50,000 per month). If Licensee makes payment in full
for the Production Equipment in less than 30 days from December 29,
then Motorola will grant a 25% payment discount. Motorola sells such
Production Equipment to Licensee FOB Motorola's (or Motorola's Contract
Manufacturer's) shipping dock. All Production Equipment is sold by
Motorola to Licensee "AS IS" and with no warranty.
2.2.3 Motorola will provide advice for the dismantling, packaging, shipment,
site preparation, and installation of the Production Equipment.
Licensee will be responsible for site preparation, unpacking and
physical installation of the Production Equipment. Motorola will
provide a Process Engineer for one (1) week on-site support to assist
in the setup and correct functioning of the Production Equipment.
-3-
Licensee agrees to obtain access to the equipment vendor
support/service organizations for the various Production Equipment to
assist in the installation. Motorola will provide a Test Engineer for
one (1) week on-site support to assist in the setup and correct
functioning of the Test portion of Production Equipment. Motorola will
provide follow-on telephone support for a three (3) month period for
both Production and Test Equipment.
2.3 Licensee may place its purchase orders for inventory and Production
Equipment by and through a third party contract manufacturer. Licensee
however, shall remain fully liable to Motorola for payments due for
such purchases. Motorola may invoice and collect such amounts due and
owing to Motorola directly from Licensee in the event contract
manufacturer is overdue in its payments to Motorola.
3.0 MANUFACTURING LICENSEE RIGHTS AND MOTOROLA OBLIGATIONS
------------------------------------------------------
3.1 For the term of this Agreement only and solely for purposes of
performing Licensee's obligations under this Agreement, Motorola
authorizes Licensee and grants to Licensee a non-exclusive,
non-transferable, non-sublicenseable right to use, reproduce, and
create derivative works of the Licensed Material, in the manufacture of
the Products. Licensee acknowledges and agrees that the foregoing
materials and information are Motorola Confidential Information (as
defined in Appendix B) and material to the interests, business and
affairs of Motorola. Licensee further acknowledges and agrees that the
disclosure or use thereof (other than as permitted under this
Agreement) would cause Motorola irreparable harm. No use of such
Motorola Confidential Information is permitted except as otherwise
provided herein and no grant under any of Motorola's patents,
copyrights, trademarks or other intellectual property rights is hereby
given or intended, including any license (implied or otherwise).
3.2 Within three (3) months of the Effective Date of the transfer of the
relevant Product, Motorola shall provide up to three (3) weeks of
training to Licensee employees at a mutually agreed upon location. Such
training shall include instructors and all course material and shall
cover the design of the Products, technical issues and appropriate
application of the Products. Motorola shall provide to Licensee
reasonable technical assistance and support requested by Licensee for a
period of twelve (12) months following the Effective Date of this
Agreement. Motorola agrees to further provide technical support as
follows: Motorola shall provide third line software support for the
6500 Plus Product for a period of twenty four (24) months beginning on
the date of transfer of such Product. Such support is intended to
provide software fixes for the ONS operating system and Applications
Xxxx packages. Licensee shall provide the initial and subsequent point
of contact for the customer, as well as problem determination and
qualification. The procedure for reporting such problems to Motorola is
set forth in Appendix B hereto.
3.3 Upon execution of the Agreement and transfer of the Product, Motorola
shall refer inquiries relating to the Products to Licensee and provide,
where permitted, relevant data to manufacture, sale and support of the
Products. Motorola MND will further refer inquires from other Divisions
and Subsidiaries of Motorola which currently purchase the Products from
Motorola MND.
-4-
3.4 Motorola agrees that it shall not reestablish manufacturing and
marketing, directly or indirectly, of the Products, or Licensee's
improvements in the Products as specified in Section 4.1, in
competition with Licensee for a period of not less than five (5) years
from the transfer of the Product, provided that Licensee is not in
breach of the terms of this Agreement and Licensee is using its
reasonable best efforts to manufacture, market, and sell the Products.
Notwithstanding the above, in the event Motorola has an obligation(s)
to furnish Motorola branded Products, which are being transferred under
this Agreement, to customers for a specific period of time, Motorola
may continue to sell such Motorola branded Products. Motorola's right
to continue to sell such Motorola branded Products shall expire twelve
(12) months from the Effective Date of this Agreement.
3.5 Licensee agrees to sell Motorola branded Product back to Motorola for
Motorola resale to its customers as cited in 3.4 above. Licensee shall
sell such Products at a price equal to Contract Manufacturer's price to
Licensee plus a xxxx-up of twelve and one-half percent (12.5%) and in
no event shall Licensee sell such products to Motorola at prices and
upon terms and conditions less favorable than those offered by Licensee
to any other customer or reseller. In the event such price is not yet
available, Licensee and Motorola shall agree upon a reasonable price.
Motorola shall assume Product warranty obligations for these Products
resold by Motorola to Motorola customers.
4.0 LICENSEE'S GRANTS AND OBLIGATIONS
---------------------------------
4.1 Improvements in the Licensed Materials created by or on behalf of
Licensee shall be owned by Licensee subject to Motorola's rights in the
original Licensed Materials. Licensee hereby grants to Motorola and its
subsidiaries a perpetual, worldwide, non-exclusive, royalty-free
license, with the right to sublicense, to use, reproduce, have made,
modify, compile, sell and distribute any improvements to the Licensed
Materials.
4.2 Upon execution of this Agreement, Licensee shall assume, perform and
discharge the following Motorola obligations and commitments related
directly to the Licensee-branded Products sold by Licensee:
(i) Ongoing technical support, in warranty service, out of
warranty service, product maintenance and other similar obligations.
(ii) Specific obligations under support agreements, service
and warranty agreements and other agreements as specifically disclosed
and incorporated into the agreement between the parties.
4.3 Licensee will undertake to manufacture, market and sell the Products
described. It is understood that Licensee may not be able to ensure
constant availability of certain Products based on transition issues,
parts availability, parts obsolescence or other unforeseen
circumstances. Licensee therefore reserves the right at its sole
discretion to discontinue certain Products transferred under the
Agreement, but in no event shall Licensee discontinue any of the
Products transferred under this Agreement within twelve (12) months of
the Effective Date of the Agreement.
-5-
4.4 Motorola intends to purchase and resell from Licensee, Licensee-branded
Products transferred under this Agreement for specific customer
opportunities. Licensee agrees to sell such products to Motorola at
prices and upon terms and conditions at least as favorable as those
offered by Licensee to any other customer or reseller.
5.0 EXPORT/IMPORT
-------------
Licensee agrees to comply with all applicable export and import laws,
regulations and orders. Licensee agrees that it will not resell,
re-export or ship, directly or indirectly, any Products or technical
data in any form without obtaining required export or re-export
licenses from the countries involved.
6.0 LABELS & MARKINGS
-----------------
Licensee agrees to include on the Products all patent numbers, all
registration or identification numbers and country of origin labels and
markings as are required by the applicable laws of the country where
the Products are intended to be sold to end-users.
7.0 SAFETY & TELECOMM APPROVALS
---------------------------
It shall be the responsibility of Licensee, and at Licensee's sole
expense, to obtain UL, CSA and Telecom approvals, as well as any other
governmental approvals or licenses, for any products it manufactures
using the Licensed Materials provided by Motorola. Motorola agrees to
provide license files and to reasonably assist Licensee at Licensee's
expense in transferring of approvals.
8.0 RESALE OF PRODUCTS
------------------
Licensee shall have the non-exclusive right to resell the Motorola
version of the Licensee-branded Products on a world-wide basis.
9.0 WARRANTY
--------
9.1 All Licensed Material and other material and information provided to
Licensee under this Agreement is licensed to Licensee "AS IS" to the
full extent permitted by applicable law. Motorola expressly disclaims
all warranties and conditions, express, implied, or statutory,
including the implied warranties or conditions of merchantability,
fitness for a particular purpose, satisfactory quality, and
non-infringement, and their equivalents under the laws of any
jurisdiction. LICENSEE FURTHER ACKNOWLEDGES THAT MOTOROLA HAS MADE NO
REPRESENTATION WITH RESPECT TO THE LICENSED MATERIAL UPON WHICH IT IS
RELYING; RATHER, LICENSEE IS LICENSING ALL SUCH MATERIAL SOLELY BASED
ON ITS OWN ASSESSMENTS OF THE LICENSED MATERIAL.
-6-
9.2 Licensee shall be responsible for any and all warranty obligations for
the Products sold by Licensee. Motorola shall have no liability or
other obligation to Licensee's customers for the Products.
9.3 Motorola shall be responsible for any and all warranty obligations for
the Products sold by Motorola prior to the execution of this Agreement
and transfer of the Product. Licensee shall have no liability or other
obligation to Motorola's customers for such Products.
10.0 CONFIDENTIAL INFORMATION
------------------------
Licensee agrees that all Licensed Material and other Motorola
Confidential Information shall be treated in accordance with the terms
of the Non-Disclosure Agreement included in Appendix C.
11.0 INTELLECTUAL PROPERTY
---------------------
11.1 The parties acknowledge and agree that Motorola shall have exclusive
ownership of the Licensed Materials. Apart from the limited right
granted to Licensee by Motorola under this Agreement to use Licensed
Materials, Licensee shall have no other rights in or to any of
Motorola's Intellectual Property Rights.
11.2 Licensee agrees to take all necessary precautions to prevent Motorola's
intellectual property rights from being disclosed or used for any
purpose other than for the design and manufacture of Products by
Licensee.
12.0 TRADEMARKS
----------
12.1 The Products manufactured under the terms and conditions of this
Agreement will carry Licensee's trademark and proprietary marks or such
other logo or other proprietary marks.
12.2 Licensee shall not do anything to infringe upon, harm, or contest the
validity of trademarks or other proprietary marks of Motorola.
12.3 Licensee agrees that it shall not use the trademark "Motorola" or any
other Motorola trademark or trade name as part of the name under which
it conducts business. Licensee acknowledges that it will not adopt or
use any of Motorola's logos, trademarks or trade names, in whole or in
part, or any confusingly similar word or symbol, as part of Licensee's
company name. Licensee specifically agrees not to use the product names
(per Appendix E) used by Motorola for the Products. However, Licensee
shall be permitted to use Motorola model numbers and product codes.
12.4 Permission to display the word "Motorola", or any other proprietary
word or symbol owned by Motorola or its affiliates is only upon written
consent of Motorola. It is expressly understood and Licensee
acknowledges Motorola's exclusive ownership in the Motorola name and
logotype as well as certain other trademarks and trade names, which
Motorola uses in connection with the Products. Licensee acknowledges
that it will not acquire any right, title or interest in the word
"Motorola" (either alone or in association with other words, names or
symbols) or any other Motorola trademark or trade name by virtue of
this Agreement.
-7-
12.5 Motorola agrees that Licensee can use external material with Motorola
marks, such as silk screened front doors and overlays, for not more
than forty five (45) from the date of transfer of the Products.
Internal marking, such as on Printed Wiring Boards, must be removed in
ninety days (90) from the date of transfer of the products. Without
exception all Products manufactured by Licensee must bear a serializing
label that clearly shows that the Product is Manufactured by Licensee.
In the event Licensee continues to own a supply of Motorola branded
Product or parts beyond the timelines outlined above in this Section
12.5, Motorola and Licensee shall negotiate a good-faith extension of
such time periods.
13.0 INDEMNIFICATION
---------------
13.1 Licensee shall indemnify and hold harmless Motorola from and against
all intellectual property infringement claims that are brought against
Motorola with regard to Licensee branded Product, and Licensee shall
pay all damages that are finally awarded against Motorola based upon
such claims.
13.2 Licensee shall indemnify, defend and hold harmless Motorola, its
agents, distributors, and/or customers, from and against all loss,
claim, damage or liabilities with respect to the Licensee branded
Products, including but not limited to losses that may result from any
third party claims of bodily injury or property loss or damage caused
by a defect in the Licensee branded Product's design, manufacture or
handling by Licensee hereunder, or any representations made with
respect to the Products' functionality.
13.3 Motorola shall indemnify and hold harmless Licensee from and against
all intellectual property infringement claims that are brought against
Licensee with regard to Motorola branded Product sold by Motorola prior
to the Effective Date of this Agreement and transfer of the Product,
and Motorola shall pay all damages that are finally awarded against
Licensee based upon such claims.
13.4 Motorola shall indemnify, defend and hold harmless Licensee, its
agents, distributors, and/or customers, from and against all loss,
claim, damage or liabilities with respect to the Motorola branded
Products, sold by Motorola prior to the Effective Date of this
Agreement and transfer of the Product, including but not limited to
losses that may result from any third party claims of bodily injury or
property loss or damage caused by a defect in the Motorola branded
Product's design, manufacture or handling by Motorola hereunder, or any
representations made with respect to the Products' functionality.
14.0 LIMITATION OF LIABILITY
-----------------------
Except as stated in Section 13 of this Agreement, UNDER NO
CIRCUMSTANCES AND UNDER NO LEGAL THEORY, TORT, CONTRACT, OR OTHERWISE,
SHALL MOTOROLA OR LICENSEE OR ANY OF THEIR RESPECTIVE DIRECTORS,
OFFICERS, EMPLOYEES OR AFFILIATES BE LIABLE TO ONE ANOTHER FOR ANY
DIRECT, INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL
DAMAGES OF ANY CHARACTER INCLUDING, WITHOUT LIMITATION, DAMAGES FOR
LOSS OF PROFIT OR GOODWILL, WORK STOPPAGE, OR ANY AND ALL OTHER
COMMERCIAL DAMAGES OR LOSSES OCCASIONED BY THE USE OF MATERIAL LICENSED
-8-
TO LICENSEE, WHETHER FORESEEABLE, ARISING OUT OF THE USE OR INABILITY
TO USE THE LICENSED MATERIAL, REGARDLESS OF THE BASIS OF THE CLAIM AND
EVEN IF MOTOROLA OR LICENSEE OR THEIR RESPECTIVE REPRESENTATIVES HAVE
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGE. THIS LIMITATION OF
LIABILITY SHALL NOT APPLY TO LIABILITY FOR DEATH OR PERSONAL INJURY TO
THE EXTENT APPLICABLE LAW PROHIBITS SUCH A LIMITATION.
15.0 TERM AND TERMINATION
--------------------
15.1 Term. The term of this Agreement shall commence on the Effective Date
and shall continue for a period of ten (10) years unless sooner
terminated in accordance with the terms of this Agreement.
15.2 Termination.
15.2.1 Breach. This Agreement may be terminated by either party for failure by
the other party to cure a breach in any material term or condition of
this Agreement. Such termination shall be effective thirty (30) days
following written notice of the breach, unless the breach is cured
within such notice period.
15.2.2 Financial Condition. This Agreement may be terminated by either party,
effective immediately upon receipt of written notice from the other
party, if:
(i) dissolution or liquidation proceedings are commenced
against the other party;
(ii) any filing is made with the court or competent
authorities by any person (including the officers, employees or
creditors of the other party) for bankruptcy, corporate reorganization,
composition or any other similar insolvency proceedings, or for asset
preservation order for the other party;
(iii) there is a substantial change in ownership of the other
party and the new entity is a direct competitor of the other party.
15.2.3 LICENSEE'S FAILURE TO MEET SPECIFIC MILESTONE OBLIGATIONS. Licensee
recognizes and agrees that Licensee's failure to achieve the following
specific milestone obligations is deemed to be a material breach of the
Agreement and notwithstanding Section 15.2.1 Motorola reserves the
right to terminate this Agreement effective five business days
following such breach, unless the breach is cured within the five
business day period.
-9-
(i) Licensee obtaining, within two weeks of the Effective Date
of this Agreement, at least two million dollars ($2 million) of new
long term debt or equity financing to satisfy existing obligations and
obligations created under this Agreement.
(ii) Licensee paying Motorola by wire transfer as of the date
Licensee obtains its financing as described in 15.2.3 (i), all amounts
due and owing to Motorola for existing obligations beyond this
Agreement. The balance of such amount owed to Motorola from Licensee is
approximately $323,618.40 as of October 20, 2000 and shall remain due
and payable even under the termination of this Agreement.
(iii) Licensee obtaining, and providing evidence to Motorola
within two weeks of the Effective Date of this Agreement, that it has
obtained, a commitment from a recognized and viable financial
institution(s) to provide to Licensee sufficient capital to meet its
payment obligations to Motorola under this Agreement and to
successfully meet its, or its assignee's, performance obligations under
this Agreement.
15.2.4 OBLIGATIONS OF THE PARTIES IN THE EVENT OF TERMINATION.
------------------------------------------------------
(i) Upon expiration of this Agreement, or in the event either
party provides notice of termination of this Agreement as provided
hereunder, Licensee shall return to Motorola all Licensed Material and
other Motorola Confidential Information.
(ii) Any obligations and responsibilities, which by their
nature extend beyond the expiration or termination of this Agreement,
shall survive and remain in effect, including without limitation,
outstanding payment obligations, warranties, indemnities,
confidentiality, limitation of liability, governing law, jurisdiction
and dispute resolution.
16.0 COMPLIANCE WITH LAWS
--------------------
16.1 Licensee warrants that it will comply with all applicable laws, orders,
rules and regulations in performing its obligations hereunder and
Licensee shall indemnify Motorola against any liability on account of
any non-compliance with the foregoing.
16.2 Licensee warrants that all Products manufactured by Licensee hereunder
will have been produced in compliance with all applicable laws, orders,
rules and regulations. Licensee shall indemnify Motorola against any
liability on account of any non-compliance with the foregoing.
16.3 Licensee shall effect or secure and maintain at its own cost all
necessary governmental permits, licenses, approvals and registrations
required in connection with Licensee's performance of its obligations
hereunder.
17.0 FORCE MAJEURE
-------------
Neither party shall be in breach of its obligation hereunder to the
extent that its performance is delayed or prevented by causes beyond
its control, including, without limitation, acts of God, acts of third
parties, civil disorders, acts of any civil or military authority,
judicial action, and strikes or other labor disputes.
-10-
18.0 CONTRACTUAL RELATIONSHIP
------------------------
It is understood and agreed that Motorola and Licensee are, and at all
times during the term of this Agreement shall remain, independent
contractors. At no time shall either party represent to any third party
that it is the agent of the other with respect to the subject matter of
this Agreement. Motorola and Licensee further covenant that no
authorization shall be given to any employee of either party to act on
behalf of the other. In no event shall either party at any time have
authority to make any contracts, commitments or undertake any
obligations on behalf of the other.
19.0 PUBLICITY
---------
Neither party shall disclose, advertise, or publish the existence or
the terms or conditions of this Agreement, financial or otherwise,
without the prior written consent of the other party.
20.0 NOTICES
-------
20.1 All notices, consents and other communications under this Agreement
shall be in writing and shall be deemed to have been duly given (a)
when delivered by hand; (b) when sent by telecopier (with receipt
confirmed), provided that a copy is promptly thereafter mailed by first
class postage prepaid registered or certified mail, return receipt
requested; (c) when received by the addressee, if sent by air courier
(receipt requested) or by such other means as the parties may agree
from time to time; or (d) twenty (20) business days after being mailed,
by first class postage prepaid registered or certified mail, return
receipt requested; in each case to the appropriate addressee and
telecopier numbers set forth below (or to such other addresses and
telecopier numbers as a party may designate as to itself by notice to
the other party):
If to Motorola: MOTOROLA, INC.
Multiservice Networking Division
00 Xxxxx Xxxxxxxxx
Xxxxxxxxx, XX, 00000
Attn: XXXXXXXXX XXXXXXXXXX, Xxxx Xxxx X0-000
Tel number: (000) 000-0000
Fax number: (000) 000-0000
If to Licensee: TELENETICS CORPORATION
00000 Xxxxxx Xxxxx
Xxxx Xxxxxx, XX 00000
Attn: Chief Operating Officer
Tel number: (000) 000-0000
Fax number: (949) 000- 0000
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21.0 GOVERNING LAW, JURISDICTION, AND DISPUTE RESOLUTION
---------------------------------------------------
21.1 Other than with respect to Motorola's intellectual property rights,
Motorola and Licensee will attempt to settle any controversy or claim
arising between Motorola and Licensee through good faith negotiation or
mediation. Any dispute which cannot be resolved through negotiation or
mediation will be submitted to the courts for resolution.
21.2 The laws and the courts of the Commonwealth of Massachusetts U.S.A. are
the exclusive laws and forum for resolving disputes under this
Agreement. The parties expressly exclude the application of the United
Nations Convention on the International Sale of Goods from the terms
and conditions of this Agreement.
21.3 Licensee further acknowledges and agrees that any breach by it of the
confidentiality and intellectual property clauses in this Agreement or
a breach by it of the Non-Disclosure Agreement will cause Motorola
irreparable harm. Accordingly, Licensee agrees that Motorola shall be
entitled to ex parte injunctive relief to prevent any threatened or
continued breach of any such clause and to specifically enforce such
clause, in addition to any other remedy which Motorola may be entitled
to at law or in equity. Licensee hereby waives the claim or defense in
any such action or proceeding against it that Motorola has an adequate
remedy at law or that a bond is necessary.
22.0 ASSIGNMENT
----------
Licensee may not assign this Agreement or delegate its performance
under it without prior written consent of Motorola, such consent not to
be unreasonably withheld. Motorola and Licensee agree that it is not
unreasonable for Motorola to withhold consent of Licensee's requested
assignment if Licensee is attempting to assign this Agreement or
delegate its performance to (i) any direct competitor of Motorola or
(ii) any entity which is unable to perform Licensee's obligations under
this Agreement to Motorola's reasonable satisfaction. Licensee agrees
that Motorola may assign this Agreement and any of its rights hereunder
to a subsidiary of Motorola, Inc.
23.0 SECTION HEADINGS
----------------
The clause headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
24.0 SEVERABILITY
------------
In case any provision of this Agreement shall be held invalid, illegal
or unenforceable, the validity, legality and enforceability of the
remaining provisions of this Agreement will not in any way be affected
or impaired thereby and all provisions herein are declared to be
separate and distinct covenants. The parties hereby agree that if any
provision is determined by any court to be invalid or unenforceable by
reason of such provision extending for too great a period of time or
over too broad a scope, then such provision shall be interpreted to
extend over the maximum period of time and the maximum scope which such
court at that time or which any other court at any subsequent time
determines to be valid and enforceable.
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25.0 WAIVER AND AMENDMENTS
---------------------
All amendments and other modifications hereof shall be in writing and
signed by each of the parties hereto. The parties hereto may by written
instrument waive compliance by the other party with, or modify any of,
the covenants or agreements made to it by the other party contained in
this Agreement. The delay or failure on the part of any party hereto to
insist, in any one instance or more, upon strict performance of any of
the terms or conditions of this Agreement, or to exercise any right or
privilege herein conferred shall not be construed as a waiver of any
such terms, conditions, rights or privileges but the same shall
continue and remain in full force and effect. All rights and remedies
shall be cumulative.
26.0 ENTIRE AGREEMENT
----------------
This Agreement, including all Appendices attached hereto, contain the
entire agreement between the parties hereto with respect to the subject
matter hereof and supersede all prior agreements and undertakings
between the parties relating to the subject matter hereof.
27.0 COUNTERPARTS
------------
This Agreement may be executed in two counterparts, each of which shall
be deemed to be an original, but all of which together shall constitute
one and the same instrument.
28.0 ADDITIONAL UNDERTAKINGS
-----------------------
The parties agree to sign all such other documents and do all such
other things as the other party may reasonably require to give effect
to this Agreement, including but not limited to releasing its
contractors and vendors to provide relevant data to the other party.
29.0 LIST OF APPENDICES
------------------
Appendix A: Product Description and Licensed Material
Appendix B: Problem Reporting Procedures
Appendix C: Nondisclosure Agreement between Licensee and Motorola
Appendix D: Manufacturing Equipment
Appendix E: Motorola Trademarks and Tradenames
SIGNATURE PAGE TO FOLLOW
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives on the dates written under their
signatures below intending for this Agreement to become effective as of the
Effective Date.
MOTOROLA, INC., by and through its TELENETICS CORPORATION
Multiservice Networks Division
"Motorola" "Licensee"
By: /S/ XXXX XXXX By: /S/ XXXX X. XXXXXX
----------------------------------- ---------------------------------
Name: XXXX XXXX Name: XXXX X. XXXXXX
--------------------------------- -------------------------------
Title: VICE PRESIDENT AND G.M., MND Title: CHIEF OPERATING OFFICER
-------------------------------- ------------------------------
Date: 10/15/2000 Date: 10/24/2000
--------------------------------- -------------------------------
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