EXHIBIT 10.6
SOFTWARE SUB-LICENSE
AGREEMENT
This Software License Agreement is entered into effective as of January
1, 1999 by and between CyberSentry, Inc., a Delaware corporation (hereinafter
"CYBS" or the Licensor), with offices c/o Sadis & Xxxxxxxx, L.L.C. Xxx Xxxx
Xxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000 and Digital Rights International,
Inc., a Delaware corporation,c/o LibertyOne Limited,(ACN 079 729918) of Xxxxx 0,
00 XxXxxxxxx Xxxxxx, Xxxxxxxxxxx Xxx , Xxxxxx XXX 0000 (hereinafter "DRI" or
"Licensee").
WHEREAS, the Templar Corporation, a Delaware corporation,(hereinafter
"Templar") acquired for publication and distribution original computer programs,
from Learning Company Properties, Inc. (hereinafter "TLC") under a License
Agreement, dated October 2,1998, a copy of which is annexed hereto and made part
hereof as Exhibit "A";
WHEREAS, Templar assigned all of its right, title and interest to the
Software License to CyberSentry, Inc., a Delaware corporation, under a letter
agreement dated, October, 1998, a copy of which is annexed as Exhibit "B."
WHEREAS, CYBS is the owner of the computer software programs listed on
Exhibit A attached hereto and the related documentation; and
WHEREAS, CYBS desires that DRI publish and distribute CYBS's programs
and DRI desires to publish and distribute the programs subject to and in
accordance with the terms of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereto agree as follows:
1. DEFINITIONS.
1.1 "Licensed Media" shall mean all computer-readable media now
known or hereafter to become known including, without limitation, magnetic media
storage devices, CD-ROM, CD-DVD and other optical disks, electronic downloading,
on-line and any other human or machine readable medium.
1.2 "Program" or "Programs" shall mean the source code, object code,
including all data and/or resources therein, whether visual or numeric, of those
one or more computer software programs of CYBS which are identified on Exhibit
A, and all related documentation.
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1.3 "Trademarks" shall mean those trademarks listed on Exhibit A.
2. LICENSE AND RIGHTS.
2.1 Non-Exclusive License. CYBS hereby grants to DRI a non-transferable,
non-exclusive, worldwide, right and license to publish and use the Programs
incorporating the Trademarks throughout the world and in the Licensed Media,
during the Term, solely for the protection of celebrity digital rights and
content related thereto on the websites owned or operated by DRI, subject to
Licensee hereby covenanting and agreeing to attorn to all of the terms and
conditions of the Primary License and subject to the terms and conditions
hereinafter set forth; and
2.3 Right to Modify the Software Programs. The rights licensed to DRI herein
shall include the right to modify the Programs (including the source code) in
order to prepare derivative works and future versions of the Programs
2.4 Upgrades and Maintenance. CYBS shall be under no obligation to provide
any upgrades to the Programs. CYBS shall however provide software engineering
support to DRI through September 30, 1999. Provided, however, DRI shall pay to
CYBS $150,000 in consideration of the software engineering support to be
provided by CYBS, which services are to be subcontracted to The Learning
Company under this section 2.4.
2.5 Closing Deliveries. DRI shall have received at or prior to the execution
of this Agreement each of the following documents:
(i) copies of all technical data, product literature and other
documentation relating to the Programs, all in form and substance as provided to
CYBS by the Learning Company; and
(ii) copies of all film, electronic files for all collateral
materials, gold masters, source code and related documentation and materials
relating to the Programs.
2.6 Delivery of Masters. DRI acknowledges receipt of all golden
masters of the various versions of the Programs.
3. OWNERSHIP OF PRODUCTS, COPYRIGHT AND TRADEMARK NOTICES.
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DRI acknowledges that CYBS and TLC retains all right, title and ownership to
each of the Programs and the Trademarks and no such rights shall pass to DRI,
except to the extent to which such rights are expressly granted under this
Agreement. DRI may file copyright registrations for each new version of the
Program that DRI releases with respect to the original work that DRI contributes
to such versions.
4. OBLIGATIONS
4.1 Support. CYBS has contracted with The Learning Company and shall
be responsible for the support of the Programs which it distributed prior to the
effective date of this Agreement. DRI shall be responsible the support of the
Programs which it distributes after the effective date of this Agreement
4.2 License Fee. The license fee for the Programs shall be equal to One U.S.
Dollar (U.S. $1.00) (the "License Fee"). The License Fee shall be settled in
U.S. Dollars.
5. TERM AND TERMINATION.
5.1 Term. This Agreement shall continue indefinitely unless
terminated as provided in this Section 5 (the "Term").
5.2 Termination For Cause. Either party may terminate this
Agreement, without further notice, for cause as follows:
(a) Bankruptcy. Either party may immediately terminate this
Agreement upon written notice to the other party in the event that proceedings
in bankruptcy or insolvency are instituted by or against the other party, or a
receiver is appointed, or if any substantial part of the assets of the other
party is the object of attachment, sequestration or other type of comparable
proceeding, and such proceeding is not vacated or terminated within sixty (60)
days after its commencement or institution.
(b) Material Breach. Either party may terminate this Agreement if
one party commits a material breach of any of the terms or provisions of this
Agreement and does not cure such breach within thirty (30) days after receipt of
written notice given by the other party.
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5.3 Late Payment/Non-performance. CYBS may terminate this Agreement
without notice or cure period if DRI fails to fulfill any of its obligations
under the Binding Term Sheet. In such event the parties specifically acknowledge
that the entire license fee shall immediately become due and payable and any
legal fees and other costs incurred by CYBS in collecting such amount shall be
paid by DRI.
5.4 Survival of Terms. Sections 3, 6, 8, 9, 10, 11 and 12 of this
Agreement shall survive any termination of this Agreement.
6. REPRESENTATIONS AND WARRANTIES.
6.1 CYBS. CYBS hereby represents and warrants to DRI that:
(a) CYBS has all right, title and interest in and to the Programs,
including the sole and exclusive right to grant the License, and such right,
title and interest shall be valid throughout the Term;
(b) the Programs do not infringe any copyright, trademark, trade
secret or other proprietary and intellectual property rights of any other
person; and
(c) CYBS has the requisite authority to enter into this Agreement
and the granting of the License and rights under this Agreement will not result
in the violation of: (i) the organizational documents or Bylaws of CYBS, (ii)
any agreement, contract, lease, license, document or other commitment, written
or oral, with respect to the Programs to which CYBS is a party or may become
bound, or (iii) any applicable law, rule, license or regulation.
6.2 DRI. DRI hereby represents and warrants to CYBS that DRI has the
requisite authority to enter into this Agreement and the performance of its
obligations under this Agreement will not result in the violation of: (i) the
organizational documents or Bylaws of DRI, (ii) any agreement, contract, lease,
license, document or other commitment, written or oral, with respect to the
Programs to which DRI is a party or may become bound, or (iii) any applicable
law, rule, license or regulation.
7. ACKNOWLEDGMENTS.
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CYBS hereby acknowledges and agrees that DRI has full discretion with
respect to the Programs pursuant to the license set forth in section 1 above
including, but not limited to the the charges that DRI may charge its celebrity
web pages for the use of the Programs. CYBS and DRI hereby agree to agree on any
charges that DRI may charge to third parties desiring to sublicense the
Programs, provided the parties agree on the suitability of the proposed customer
as well as the royalty which shall be charged and collected by DRI and the
portion thereof which shall be reserved for and payable to CYBS as a license
fee, as more particularly set forth on Exhibit "C," "Distribution of the
Programs". CYBS also acknowledges that nothing in this Agreement shall require
DRI to begin to market, or, once begun, to continue to market, the Programs if
DRI, in its sole discretion, determines that it would not be commercially
reasonable to do so.
8. INDEMNITY.
8.1 DRI. DRI shall indemnify and hold CYBS harmless from and against
all claims, suits, demands, actions and proceedings, judgments, penalties,
damages, costs and expenses (including reasonable legal fees and costs), losses
or liabilities of any kind ("Damages") which may arise or result from (a) the
marketing or servicing by DRI of the Programs, except for matters referred to in
Section 8.2, and (b) from a material breach of any representation, warranty or
agreement of DRI. DRI may not transfer, assign, mortgage, charge, or otherwise
encumber or dispose of any of its rights under this Agreement.
8.2 CYBS. CYBS shall indemnify and hold DRI harmless from and
against all Damages which may arise or result from (a) the Programs, or any part
thereof, infringing the copyright, trademark, trade secret or other proprietary
or intellectual property rights of any other person or entity, and (b) from a
material breach of any representation, warranty or agreement of CYBS.
8.3 Litigation. With respect to any claims falling within the scope
of the foregoing indemnifications:
(a) each party agrees to notify the other promptly of and keep the
other fully advised with respect to such claims and the progress of any suits in
which the other party is not participating;
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(b) the indemnifying party shall have the right to defend any suit
instituted against the indemnified party;
(c) the indemnifying party shall have the right to participate, at
its expense, in the defense of a claim or suit made or filed against the
indemnified party; and
(d) a party participating in or assuming the defense of a claim or
suit against the other party shall not settle such claim or suit without the
prior written approval of the other party, which approval will not be
unreasonably withheld or delayed.
8.4 Indemnification Limits. Neither party shall be required to make
any indemnification payment pursuant to this Section 8 until such time as the
total amount of all Damages that have been directly suffered or incurred by such
party exceeds US $25,000.
9. CONFIDENTIALITY.
Neither party shall issue a press release relating to this Agreement
without the prior written consent of the other party.
The terms of this Agreement are confidential and shall not be disclosed
to any other party without the written consent of the other party. Each party
shall (and shall take such reasonable action to ensure that its employees)
preserve in strict confidence any information obtained by the other party or its
employees, concerning its business or any of its affiliates including, without
limitation to, trade secrets and proprietary information, and agrees, except as
expressly permitted herein, to refrain (and shall take such reasonable action to
assure that its employees) from disclosing, during the term of this Agreement or
at any time thereafter, any such information to any person or persons, or
business organizations.
10. NOTICES.
Notices permitted or required under this Agreement shall be sent to the
addresses set forth below and shall be sent by hand delivery, by telecopier
followed with written confirmation sent by mail, by overnight courier or by
registered or certified mail, return receipt requested. Notices shall be deemed
to have been given on the date actually received if sent by hand delivery ,or
overnight courier, on the date sent if sent by telecopier, or three (3) days
after mailing if
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sent by registered or certified mail.
If to CYBS:
CyberSentry, Inc.
c/o Xxxxxx X. Xxxxxxx,Esq.
000 Xxxx 00xx Xxxxxx, X.XX.X
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to: Digital Rights International, Inc.
c/o LibertyOne Limited
Phone + 000 0000 0000
Fax + 000 0000 0000
Xxxxx 0 - 00 XxXxxxxxx Xxxxxx
Xxxxxxxxxxx Xxx Xxxxxx
New South Wales 2011
Australia(ACN 079 729918)
11. DISPUTE RESOLUTION.
11.1 Arbitration. Any dispute, controversy or claim arising out of or
in connection with this Agreement shall be determined and settled by arbitration
in Wilmington, Delaware pursuant to the rules then in effect of the American
Arbitration Association, and each party hereby consents to the jurisdiction
thereof. Any award rendered shall be final and conclusive upon the parties and a
judgment thereon may be entered in a court having competent jurisdiction. The
party submitting such dispute shall request the American Arbitration Association
to: appoint an arbitrator who is knowledgeable in the microcomputer area and
familiar with the data processing industry and who will follow substantive rules
of the law; allow for the parties to request discovery pursuant to the rules
then in effect under the Federal Rules of Civil Procedure for a period not to
exceed sixty (60) days; require the testimony to be transcribed; and require the
award to be accompanied by findings of fact and a statement of reasons for the
decision. All costs and expenses, including attorney's fees, of all parties
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incurred in any dispute which is determined and/or settled by arbitration
pursuant to this Section 13 shall be borne by the party determined to be liable
in respect of such dispute; provided, however, that if complete liability is not
assessed against any one party, the parties shall share the total costs in
proportion to their respective amounts of liability so determined.
11.2 Injunctive Relief. Notwithstanding Section 11.1, the parties
hereto further agree that any breach of Sections 6, 8 and 9 of this Agreement is
likely to result in irreparable injury to the other and each party agrees that
the other shall be entitled, if it so elects, to institute and prosecute
proceedings in any court of competent jurisdiction to enforce the specific
performance of this Agreement by such party, or to enjoin such party from
activities in violation of this Agreement.
12. MISCELLANEOUS.
12.1 Entire Agreement. This Agreement contains the entire
understanding of the parties hereto relating to the Program, supersedes any
prior written or oral agreement or understandings between the parties with
respect to the Programs, and cannot be changed or terminated orally. This
Agreement may be amended only by a writing signed by the parties hereto.
12.2 Enforceability. The invalidity or unenforceability of any
provision of this Agreement will not affect the validity or enforceability of
any other provision of this Agreement.
12.3 Assignment. Neither this Agreement nor the rights or obligations
hereunder may be assigned by either party without the prior written consent of
the other party, which consent shall not be unreasonably withheld; provided
however, that this Agreement may be assigned by either party to an Affiliate of
such party, or upon the merger of the party or the sale of such party's
business, all without the consent of the other party, upon providing notice to
the other party.
12.4 Independent Contractors. CYBS and DRI shall perform their duties
pursuant to this Agreement as independent contractors. Nothing in this Agreement
shall be construed to create a joint venture, partnership or other joint
relationship between CYBS and DRI. Neither party shall have the ability to incur
any obligation on behalf of the other party.
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12.5 Successors. All rights and obligations arising out of this
Agreement shall enure to the benefit of, and be binding on and enforceable by
the parties and their respective successors and permitted assigns.
12.6 Governing Law. This Agreement and its validity, construction
and performance shall be governed in all respects by the internal laws of the
State of Delaware.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed under seal as of the date first set forth above.
CyberSentry, Inc.
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------------
Xxxxxx X. Xxxxxxx, President
Digital Rights International, Inc.
By: /s/ Xxxxxx Xxxxxxx
----------------------------------
Name: Xxxxxx Xxxxxxx
Title: Director
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EXHIBIT A-
l. Learning Company License Agreement-Annexed hereto and made part hereof.
2. Programs:
Each and every version of the Cyber Sentry program.
3. The Trademarks: "Cyber Sentry"
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EXHIBIT B-
Templar Assignment to CYBS
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EXHIBIT C
DISTRIBUTION AGREEMENT
SCHEDULE OF ROYALTY PAYMENTS
ROYALTY PERIODS
1. Initial Royalty Payment: An initial payment in the form of One
Dollar and other good and valuable consideration, receipt of which is
acknowledged.
2. Additional Payments: Such other Royalty payments shall be paid in an
amount equal to ten (10%) of the royalty or any usage payment paid to DRI.
Example: If royalty or usage fees due to DRI under any third party agreement is
$1.00, then payment due to CYBS hereunder shall be $0.10 from DRI on Licensed
Programs sold.
3. The Licensee may not transfer or assign any of the rights licenced to it
under this agreement without the prior written consent of CYBS.
4. Licensor's Approval, Licensor's First Right of Refusal and Calculation
of Royalty Rates.
(A) No less than 90 days before commercially exploiting any Licensed Program
developed using or incorporating the Licensed Programs, DRI must submit each
Licensed Product Line with relevant technical specifications and marketing plans
for the Licensed Program to CYBS for approval, which approval will not be
unreasonably witheld or delayed.
A.1 Within 60 days after submission of the Licensed Program under
clause 4(A), the parties must meet to determine:
(a) The program is suitable and will not adversely reflect upon the
integrity or image of CyberSentry ie. pornography and to determine the royalty
payable by DRI to CYBS in respect of each Licensed Program; and
5. Payments.
5.1 Royalties and fees are payable by DRI within thirty (30) days
after the receipt of each Royalty or fee and shall be calculated by reference to
the Licensed Program used during the Period. Each payment must be accompanied by
a statement signed by an authorized officer of DRI showing the quantity and
respective Royalty or fee of Licensed Programs used during, and the calculation
of the Royalties or fees payable in respect of, that Royalty Period.
Method and Payment of Taxes.
5.2 All payments to be made by DRI under this Agreement must be
made:
(a) in U.S. currency and in immediately available, freely
transferable, cleared funds to CYBS's nominated bank account as specified by
CYBS from time to time; and
(b) without any set-off or deduction, unless DRI is required
to make such a payment subject to the deduction or withholding of tax, in which
case the sum payable by DRI shall be increased to the extent necessary to ensure
that, after the making of such a deduction or withholding, CYBS receives and
retains (free from any liability in respect of such deduction or withholding) a
net sum equal to the sum which it would have received and so retained had no
such deduction or withholding for taxes been made or required to be made.
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