EXHIBIT 10.2
SOFTWARE LICENSE AGREEMENT DATED JULY 15, 2005
SOFTWARE LICENSE AGREEMENT
THIS AGREEMENT AND LICENSE ("Agreement") is entered into as of the 15th
day of July, 2005 (the "Commencement Date") by and between Axiometric, LLC, a
Maryland limited liability company having a principal place of business at 00000
Xxxxx Xxxx, Xxxxxxxx, XX 00000 ("Licensor"), and Link Plus Corporation, a
Delaware corporation having a principal office at 0000 Xxxxxxxx Xxxxxxx Xxxxx,
Xxxxx 000, Xxxxxxxx, XX 00000 ("Licensee").
WITNESSETH:
WHEREAS, Licensor owns certain computer software related to self
organizing and healing networks, data compression, and radio performance
enhancement, and provides certain maintenance and support services as further
described herein; and
WHEREAS, the Licensor and Licensee entered into a Letter of Intent
dated May 3, 2005, a portion of which was binding upon the parties, and now
desire to confirm and further describe their relationship and the agreements
initially set forth in the binding portions of that Letter of Intent; and
WHEREAS, this Agreement is intended to be the "IP License" described in
the Letter of Intent.
NOW, THEREFORE, in consideration of the mutual promises contained
herein, the fees to be paid in connection therewith, and other good and valuable
consideration, the sufficiency of which is hereby acknowledged, the parties
intending to be legally bound, hereby agree as follows:
1. DEFINITIONS
1.1 "Product" means the computer-based system described in Schedule A
including the computer software in both the source and object code
form, and all Documentation or any enhancements, changes, derivative
works, improvements and other modifications.
1.2 "Copy" means an authorized copy of the Product made by Licensee
pursuant to the terms and conditions hereof;
1.3 "Documentation" means Product documentation as defined in schedule
A.
1.4 "Intellectual Property Rights" means all worldwide copyright,
trade secret, know-how, trademark, service xxxx and patent rights
(including rights to inventions, patent applications and letters
patent) and all other intellectual and other property rights in and to
the Product and Licensor's confidential information relating thereto.
1.5 "Proprietary Notice" means a copyright notices, trademark notices,
patent markings, trade secret legends, confidentiality labels and other
notices that Licensor uses or specifies from time to time to show its
ownership of the Intellectual Property Rights.
1.6 "Bug" means a significant error or set of errors in the Product
that prevent the Product from operating substantially in accordance
with its functional specifications.
1.7 "Bug Correction" means one or more modifications or additions that
when made or added to the Product either establishes material
conformity of the Product to its functional specifications or
eliminates the practical adverse effect of a Bug.
1.8 "New Release" means one or more new releases, new versions and/or
major upgrades of the Product.
1.9 "Enhancement" means any improvement, upgrade, enhancement to, of
the Product.
1.10 "Maintenance and Support Services" has the meaning set forth in
Section 4.
1.11 "License" means the license described in paragraph 2.1.
2. License
2.1 Subject to the terms, conditions and limitations set forth herein,
Licensor hereby grants to Licensee, and Licensee hereby accepts, an
irrevocable (except upon breach of this Agreement), non-exclusive
non-assignable world wide license to (i) create products derived from
Axiometric copyrighted software for sale to third parties. ii) create
products that embody the attached provisional patent for sale to third
parties. The license does not grant Licensee the right to sub-license
the copyrighted software or patent to third parties nor allow third
parties to create works derived from the copyrighted software or
embodying the patent.
2.2 Under no conditions shall the Licensee provide the source code,
design documentation, nor any other materials marked or reasonably
understood to be Licensor proprietary and confidential materials to
third parties without the express written consent of Licensor.
2.3 Under no conditions shall Licensee allow third parties to adapt,
change, copy, de-compile, enhance, modify, redesign, or reverse
engineer the Product in any way.
2.4 The Product cannot be used in Automatic Meter Reading products
except as allowed for in the Axiometric/LKPL Affiliate Agreement or
otherwise mutually agreed to in writing.
2.5 Licensee shall pay Licensor a royalty, calculated on a quarterly
basis, at a rate of three percent (3%) of the gross sums actually
received by the Licensee from sales of the Licensee's products that
incorporate the Product with a minimum royalty of 50/100 Dollars
($0.50) per end-user product sold. The Licensee will pay the royalties
until such time as the total sum of all royalties paid equals Two
Million Dollars ($2,000,000.00) at which point the License shall be
deemed paid in full, and the Licensee will have no further obligation
to pay the Licensor for the License. All other terms of this agreement
shall remain in effect after the License is paid in full.
a. The Licensee will provide the Licensor a quarterly report
(in hard copy and electronic copy (if applicable)) showing the
number of royalty bearing units sold and sublicenses granted, the
gross sums received from sales and sublicense fees received, a
cumulative total of royalty payments made for each royalty bearing
product and a cumulative total of all royalty payments made under
this Agreement.
b. Licensor shall have the right to conduct an audit after the
end of each calendar year to verify the accuracy of the Licensee's
quarterly royalty reports for that year, provided the audit must
be initiated no later than June 30th of each year, and that if no
such audit is conducted, then the quarterly reports for that year
will be deemed accurate.
c. In the event the Licensor's audit shows that the number of
units actually sold by the Licensee was greater than the
number of units reported sold by the Licensee, then the
Licensee shall have the right, at the Licensee's cost, to
have its own auditor verify the Licensor's audit. If the
Licensee's audit confirms the report of the Licensor's
auditor, then the Licensee will pay the deficiency in
royalty payments within fifteen (15) days from the time
Licensor invoices for the deficient payment.
d. In the event the Licensor's audit shows that the number of
units actually sold by the Licensee is more than three
percent (3.0%) more than the number of units reported sold
by the Licensee, then the Licensee will have the right, at
the Licensee's cost, to have its own auditor verify the
Licensor's audit. If the Licensee's audit confirms the
report of the Licensor's auditor, then the Licensee will pay
the deficiency in royalty payments and the cost of the
Licensor's audit within fifteen (15) days from the time
Licensor invoices for those fees and provides standard proof
of the time and expenses incurred.
2.6 Licensee acknowledges that Licensor owns all right, title and
interest in and to the Product and all Intellectual Property rights and
the Licensee shall have only those rights expressly granted to it under
the License and this Agreement. Licensee agrees to and shall protect
the confidentiality of and not disclose to others any and all
confidential and proprietary information embodied in Intellectual
Property Rights or the Product, or disclosed in the course of
Maintenance and Support Services, including maintaining intact all
Proprietary Notices. Confidential information does not include
information that
was in the public domain, not as the result of any act or omission of
Licensee, at the time of disclosure, or information that Licensor
approves for disclosure by written authorization. This section 2.6
shall survive any termination of this Agreement in perpetuity.
2.7 This agreement may be terminated by either party if the other party
materially breaches any provision of this Agreement and such breach is
not cured by the breaching party within thirty (30) days after the
party desiring to terminate the Agreement gives the breaching party
written notice of the breach. If the breach is not cured within the
30-day notice period, the Agreement will terminate automatically.
Licensor may terminate this Agreement immediately without notice upon
the commencement of any voluntary or involuntary bankruptcy or
insolvency proceedings seeking liquidation or reorganization of
Licensee
2.8 If the Licensor fails to timely perform its obligations or
otherwise materially breaches this Agreement, then the Licensee will
give the Licensor notice of the breach and the reasonable actions that
the Licensor must take to cure the breach (including a reasonable time
by which the Licensor must complete the cure), and the Licensee may
suspend royalty payments until such time as Licensor cures its breach.
If the Licensor's breach is not timely cured then the Licensee may
exercise all of the rights under the License without any obligation to
pay royalties or any other sums to the Licensor until such time as the
breech is remedied.
3. New Releases
Both parties understand that the final revisions to the Product will be
completed in the course of work conducted during the May 9th 2005 Statement of
Work - SOW-AX1. Upon completion of a deployable AMR Product Suite as defined in
the July 2005 Affiliate Agreement, both parties agree to put the Product under
configuration management and designate the release version for the Product. That
release version will constitute the Product covered under this Agreement.
Licensor must make each new Release available to Licensee at a cost to be
negotiated under separate agreement and the new Releases will become a part of
the Product.
4. Maintenance and Support Services
4.1 The Licensor shall provide the following Maintenance and Support
Services to Licensee at no additional charge for a period beginning on
the Commencement Date and ending 12 months after the total royalty has
been paid in accordance with Section 2.2 (the "Initial Period").
(a) Startup training: Licensor will provide, on an as-needed
basis upon request by Licensee, sufficient technical support
related to the use, installation, definition, and other aspects
of the Product such that Licensee can successfully utilize the
Product. This support shall be provided to Licensee free of
charge up
to 40 hrs and during regular business hours. Should additional
training be required, Licensor shall provide that at its
prevailing rates and under a contract to be negotiated
separately.
(b) Bug Correction: Licensor will use reasonable diligence to
correct verifiable and reproducible Bugs that have been reported
by Licensee in accordance with Licensor's standard reporting
procedures and provide Bug Corrections (including the source code
for the Bug Corrections) as quickly as practical. A Bug
Correction, when completed, may be provided in the form of a
"temporary fix," which shall consist of sufficient programming
code and operating instructions to implement a Bug Correction. If
requested by Licensor, Licensee shall provide a listing output
and any other data or information that Licensor may require in
order to reproduce the Bug and the operating conditions under
which it occurred or was discovered.
(c) Enhancements: From time to time Licensor will provide
Enhancements (including the source code for the Enhancements) to
Licensee at no additional charge as part of the Maintenance and
Support Services unless the Enhancements are so extensive that
they would constitute a new Release.
(d) Additional Technical Support: At the request of the
Licensee, additional levels of support including custom
enhancements to the Product can be purchased from the Licensor at
a rate and schedule to be negotiated.
4.2 Licensor's Maintenance and Support Services shall not cover any
problems resulting from (i) modifications to the Product not made or
authorized by Licensor, or (ii) the misuse or improper use of the
Product.
5. Term
The term of the License and this Agreement shall be perpetual unless
the Agreement is terminated pursuant to the terms and conditions hereof. Upon
termination of the License and Agreement, the Licensee agrees to return all
copies of the Product, all documentation, and all physical embodiments of the
Intellectual Property rights and immediately cease using the Product. The
Licensee agrees that the source code and IP provided by Licensor represent a
substantial business asset of the Licensor and that use of the Product or any
derivative of the Product and IP after termination of License would constitute a
violation of the terms of this Agreement and would result in substantial damage
to Licensor.
6. Payment
6.1 The Licensee will pay royalties to the Licensor within 45 days of
the close of each calendar quarter.
6.2 Royalty payments that are not received within thirty (30) days
after their due date will bear interest at the rate of twelve percent
(12.0%) per year compounded monthly from the due date until receipt of
payment by Licensor.
6.3 If Licensee fails to make royalty payments within 60 days after
their due date then in addition to the other rights and remedies
provided in this Agreement, the Licensor may exercise any or all of the
following rights and remedies:
a. Withhold all Maintenance and Support Services until all payments
are paid in full; and
b. If the Licensee fails to make royalty payments for a total of 90
days after their due date, then the Licensor may terminate the
License and this Agreement, provided the Licensee's royalty
payment obligations will survive that termination.
7. Limited Warranty
For a period of ninety (90) days (Warranty Period) from the date
Product is delivered to Licensee, Licensor will warrant that the
Product will substantially conform with the descriptions in the
accompanying written materials if used in accordance with the
procedures in such documentation. Licensor warrants that within the
Warranty period, the medium on which the Product is delivered shall be
free from defects in materials and workmanship under normal use and
service. Any replacement of the Product will be warranted for the
remainder of the original warranty period or thirty (30) days,
whichever is longer.
LICENSOR REMEDIES UNDER WARRANTY: Licensor's sole obligation (and
Licensee's sole remedy) with respect to the foregoing Limited Warranty
shall be to, at Licensor's option, refund the fees paid by Licensee
hereunder or repair any defective product or replace any defective
product with functionally equivalent product, after the defective
product is returned to Licensor.
NO OTHER WARRANTIES: EXCEPT AS EXPRESSLY SET FORTH ABOVE, THE PRODUCT
IS PROVIDED "AS IS" WITHOUT WARRANTY OF ANY KIND, AND NO OTHER
WARRANTIES, EITHER EXPRESSED OR IMPLIED ARE MADE WITH RESPECT TO THE
PRODUCT, INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, OR
NON-INFRINGEMENT OR ANY OTHER WARRANTIES THAT MAY ARISE FROM USAGE OF
OR THE RESULTS OF THE USE OF THE PRODUCT IN TERMS OF CORRECTNESS,
ACCURACY, RELIABILITY, OR OTHERWISE AND DOES NOT WARRANT THAT THE
OPERATION OF THE PRODUCT WILL BE UNINTERRUPTED OR ERROR FREE. LICENSOR
DISCLAIMS ANY WARRANTIES NOT STATED HEREIN.
NO LIABILITY FOR CONSEQUENTIAL DAMAGE: The entire liability of Licensor
is set forth above. To the maximum extent permitted by applicable law,
in no event
shall Licensor be liable for any damages, including, but not limited
to, any special, direct, indirect, incidental, exemplary, or
consequential damages, expenses, lost profits, lost savings, business
interruption, lost business information, or any other damages arising
out of the use or inability to use the Product, even if Licensor has
been advised of the possibility of such damages. Licensee acknowledges
that the applicable purchase price or license fee for the Product
reflects this allocation of risk. Because some states/jurisdictions do
not allow the exclusion or limitation of liability for consequential or
incidental damages, the above limitation may not apply. If the
foregoing limitation of liability is not enforceable because Licensor
Product sold or licensed to Licensee is determined by a court of
competent jurisdiction in a final, non-appealable judgment to be
defective and to have directly caused bodily injury, death, or property
damage, IN NO EVENT SHALL THE CUMULATIVE LIABILITY OF LICENSOR FOR ALL
CLAIMS RELATING TO OR ARISING FROM THIS AGREEMENT OR THE PRODUCT EXCEED
THE TOTAL AMOUNT OF ROYALTIES OR LICENSE FEES PAID TO LICENSOR BY
LICENSEE FOR THE AFFECTED PRODUCT WITHIN THE TWELVE (12) MONTH PERIOD
PRIOR TO THE DATE UPON WHICH SUCH LIABILITY ARISES HEREUNDER..
USE IN LIFE SUPPORT APPLICATIONS: Product is not designed for use in
any life support and/or safety equipment where failure to perform can
reasonably be expected to result in personal injury or death. Licensee
uses or sells Licensor Product as a component of life support and/or
safety applications at Licensee's own risk and agrees to defend,
indemnify, and hold harmless Licensor from any and all damages, claims,
suits, or expense resulting from such use or sale.
8. AUTHORITY TO ENTER INTO AGREEMENT
Each party represents and warrants to the other party that it has the right to
enter into this Agreement and assume the obligations hereunder, and that the
individual who executes this Agreement in its behalf is authorized to bind the
party to this Agreement.
9. EQUITABLE RELIEF
Because of the unique and proprietary nature of the Product and Intellectual
Property Rights, it is understood and agreed that Licensor's remedies at law may
be inadequate and the Licensor may be entitled to equitable relief, including
without limitation injunctive relief, specific performance or other equitable
remedies in addition to all other remedies provided hereunder or available to
Licensor at law or equity.
In the event injunctive relief is granted, the prevailing party shall pay the
attorney's fees and reasonable related costs and expenses of the other party.
10. INDEMNIFICATION
The Licensor has submitted the Product for patent approval and shall continue to
pursue patent protection for the Product. The Licensor's patent search shows
that it does not infringe on any existing patents, but the Product has not
received a patent, so the Licensor does not guarantee that the Product does not
infringe on an existing patent. Both the Licensor and Licensee understand that
they are assuming risks in using the Product before the Licensee receives a
patent, therefore they agree as follows:
(a) If the Licensor receives a patent for the Product, then the
Licensor may, at the Licensor's option, defend any U.S. patent
infringement claim or violation of US copyright by any third
party with respect to the Product, in which case the Licensor
shall indemnify and hold Licensee harmless from and against
any loss, cost, damage, liability, or expense (including
reasonable legal fees) suffered or incurred by Licensee in
connection with that infringement claim.
(b) If Licensor elects to defend the patent for the Product with
assistance from Licensee, then the Licensor shall negotiate
with the Licensee to co-defend the patent at a rate to be
negotiated based on the particulars of the suit. The Licensee
may deduct Royalty payments of the affected Products from
documented legal fees used to defend against the property
infringement claim.
(c) If Product shall be held to infringe any United States patent
and Licensee shall be enjoined from using the same, Licensor
will exert its reasonable efforts, at its option and at its
expense, (i) to procure for Licensee the right to use Product
or functionally equivalent Product free of any liability for
patent infringement or (ii) to replace Product with a
non-infringing substitute otherwise complying substantially
with all requirements of this Agreement or (iii) refund the
purchase price, transportation costs, and license fees of such
affected Product.
(d) If the Licensor does not receive a patent for the Product, but
may obtain one by modifying the Product, then Licensor may, at
the Licensor's option, take such action as required to change
Product and reapply for a patent. Upon receipt of a valid
patent Licensor shall make available at no additional charge a
new release of the Product.
(e) If a claim or suit alleging infringement of a patent,
copyright or other right is made by a third party against
Licensor, and Licensor has not obtained a patent for the
Product, Licensee shall defend, indemnify and hold harmless
Licensor, its officers, directors, employees, agents,
successors and assigns from and against any and all losses,
damages, liabilities, and related fees, expenses and costs
including attorneys' fees arising out of or related to such
claim or suit.
(f) Notwithstanding any other provision of this Agreement,
Licensee shall defend, hold harmless and indemnify Licensor,
its officers, directors, agents, employees, successors and
assigns from and against any and all actions, suits, demands,
claims, losses and damages including all related fees, costs,
expenses and attorneys' fees arising out of or relating to (1)
any suit or claim that Licensee's technology violates or
infringes the rights of any third party, and (2) any breach by
Licensee of any of the terms or conditions of this Agreement
11. NOTICES
All notices and other communications required or permitted to be given under
this Agreement shall be in writing and hand-delivered, or mailed by first-class
mail postpaid, or sent by an overnight courier with a reliable tracing system,
by one party to the other as follows:
FOR LICENSOR: Axiometric LLC.
00000 Xxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Chief Operating Officer
FOR LICENSEE: Link Plus Corporation
0000 Xxxxxxxx Xxxxxxx Xxxxx
Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
Attention: Chief Operating Officer
Notices that are mailed shall be deemed to have been given as of the fourth
business day following the date of mailing and notices that are hand-delivered
or sent by overnight courier are deemed to be given the next business day.
Either party may change its address for the giving of notice by so notifying the
other party by ten (10) days prior written notice given in the manner set forth
in this Section.
12. GENERAL PROVISIONS
12.1 Schedule A, and the exhibits thereto, if any, are incorporated in this
Agreement to the same extent as if fully set forth herein. All references to
particular Sections are to Sections contained in this Agreement. To the extent
any provision, portion or extent of this Agreement is determined to be invalid,
illegal or unenforceable, such provision, portion or extent shall be severed or
deleted here from or limited so as to give effect to the intention of the
parties insofar as possible. The invalidity or unenforceability of any provision
hereof shall not affect the validity or enforceability of any other provision.
The captions in this Agreement are inserted for convenience of reference only
and do not constitute a part of the Agreement and shall not modify or limit any
of the terms thereof.
12.2 This Agreement taken together with the attached and separately executed
Affiliate Agreement (a) constitutes the entire understanding between the parties
concerning the licensing by the Licensor of the Product to the Licensee and
supersedes all prior agreements or understandings whether written or oral with
the exception of the before-mentioned Letter of Intent whose terms and intent
remain in effect and are further clarified by this Agreement, (b) may not be
amended except in a writing executed by all parties, and (c) shall be governed
by and construed and enforced in accordance with the laws of the State of
Maryland (without reference to its rules relating to conflicts of laws)
applicable to agreements made to be performed entirely within Maryland. The
parties agree, to the maximum extent permitted by law, that the venue for any
litigation or dispute arising out of this Agreement shall be in Xxxxxx County,
Maryland and that the Federal and State courts therein shall have jurisdiction
over the subject matter and the parties.
12.3 This Agreement may not be assigned by the licensee and any attempted
assignment shall be void, except that either party may, upon written notice to
the other party, assign this Agreement to any Affiliate and in the event of the
sale of all or substantially all of its assets or equity.
12.4 This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties have
caused this instrument to be duly executed as of the date first written above.
Axiometric, LLC (Licensor) Link Plus Corporation (Licensee)
By: By:
----------------------------------- ---------------------------------
Xxxxx Xxxxx Xxxxxx X. Xxxxx, Xx.
Managing Director Chairman, CEO
Schedule A
The Product means:
The Axiometric mesh software providing a low-data rate, high-reliability,
high-redundancy scalable ad-hoc mesh network. The C-language software components
include:
o Radio driver module for LinkPlus ASM3 and LRMX radio module
o Hardware timer driver module for a Philips LPC21xx ARM7TDMI processor
o Generic PHY module with forward error correction (FEC) option using Xxxxx
or Xxxx-Xxxxxxx ECC codes (use of RS codes may require separate license).
o Encryption module (XXTEA algorithm) for block encryption at PHY layer
o MAC module implementing mesh algorithms including CRC error detection,
pseudo-random number generators, and mesh timing subsystem.
o NET module implementing optional store-and-forward routing.
o Application framework including message queues and memory buffer pools,
and utility functions.
The ARM assembler software components include:
o Run-time initialization code for a Philips LPC21xx ARM7TDMI processor
All modules will be provided as fully commented source code modules in machine
readable format. The code is suitable for implementing a mesh network consisting
of mesh sensor nodes (e.g. meters), mesh routers, and a mesh controller (e.g.
gateway)
Documentation means:
All associated user documents and descriptive documents which detail the Product
and the use of the Product, describe the data elements, Product architecture,
etc. which would be used to understand the Product and how to use it, and
includes the attached Provisional Patent which describes the Product
"Maintenance and Support Services" will include:
Up to 40 hours of support to provide training in the use of the
Product, Bug Corrections, Enhancements, and Product updates or changes
that are not associated with a new version of the Product.
