AGREEMENT
EXHIBIT
10.8
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AGREEMENT
This Agreement is a binding contractual
relationship by and between Integra Micro Systems (P) Ltd. (“Developer”) and
Sonasoft, Corp. (“Client”).
WHEREAS, Client has an existing product
line for backup and disaster recovery (the “Sonasoft Products”) that work
specifically with Microsoft SQL Server; Exchange Server; and File
Systems.
WHEREAS,
Developer has expertise and resources to assist Client in developing archiving
functionality for its backup and disaster recovery products using Microsoft
Corporation operating systems (the “Microsoft Archiving Solution”);
WHEREAS, Client wishes to work with
Developer in order to develop the Microsoft Archiving Solution;
WHEREAS, Client and Developer agree to
go forward with such endeavor on the following terms and
conditions.
NOW THEREFORE; It is
agreed:
1. Client
will provide the following engineering resources at the following rate to
develop, test and debug a robust, retail ready Microsoft Archiving Solution;
compatible with the existing Sonasoft Products; with functionality to be agreed
upon between the parties:
(a) Number
of
Engineers:
_______
(b) Rate: _______
(c) Expenses: _______
(d) Budget
Total (“Total Project
Cost”): _______
These
parameters may only be changed upon the agreement of the
parties. Developer will provide periodic xxxxxxxx to reflect the
costs actually incurred, on a cumulative basis (the “Actual Project Cost”), and
these xxxxxxxx will be duly reviewed and approved by Client.
2. Once
completed; Client will use best efforts to market the Microsoft Archiving
Solution to customers of Client along with other Sonasoft products.
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3. In
exchange, Client shall pay Developer a royalty (the “Royalty” or “Royalties”) on
the sale of each Microsoft Archiving Solution, at the following
rate:
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(a)
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Ten
percent (10%) of the net proceeds received by Sonasoft for such sale;
until such time as two hundred percent (200%) of the Actual Project Cost
has been cumulatively received by Developer;
then
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(b)
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Five
percent (5%) of the net proceeds received by Sonasoft for such sale; until
such time as an additional three hundred percent (300%) of the Actual
Project Cost has been received by Developer; resulting to a total payment
to Developer of five hundred percent (500%) of the Total Project
Cost.
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At the
point in time that five hundred percent (500%) of the Actual Project Cost has
been received by Developer, no further Royalties shall be owed.
In the
event that the Microsoft Archiving Solution is bundled with, or sold in such a
fashion as to be indistinguishable from, other Sonasoft Products, Client shall
make an objectively reasonable allocation between the products for the purposes
of determining the Royalties to be paid with each sale. Additionally,
the percentage applied to Royalties paid on OEM sales by Client shall be
determined on a case by case basis, at such time Client enters into a specific
OEM agreement which covers the Microsoft Archiving Solution.
4. The
Royalties shall be payable only after Client receives payment from its customer
for the Microsoft Archiving Solution to which the Royalty
applies. Client shall make a calculation of Royalties owed at the end
of each calendar quarter, and shall remit full payment of Royalties owed to
Developer within fifteen (15) days thereafter in U.S.
dollars. Developer shall have the right, upon request by Developer,
to have payment made in common stock of Client at the then fair market value of
such common stock in lieu of cash. Client will share with Developer
the details of each sale which covers the Microsoft Archiving Solution for each
calendar quarter, within fifteen (15) days of the end of the
quarter.
5. The
payment of the Royalties shall be accelerated, to require a full payment of any
unpaid portion of 500% of the Actual Project Cost, in the event of a sale of the
Client. For the purposes of this provision, a “Sale of the Client”
shall have occurred if any of the following occurs:
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(a)
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the
direct or indirect sale or exchange in a single or series of related
transactions by the shareholders of the Client of more than fifty percent
(50%) of the voting stock of the
Client;
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(b)
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a
merger or consolidation in which the Client is a party;
or
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(c)
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the
sale, exchange, or transfer of all or substantially all of the assets of
the Client; or
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(d)
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the
registration of all or a portion of the outstanding shares of the Client
on a public exchange.
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The
payment required under this section shall be paid to Developer within thirty
(30) days of the Sale of the Client, as defined above. Such payment,
as with other payments outlined above, may be in U.S. Dollars or, at the option
of Developer, in common stock of Client at the then fair market value of such
stock.
In
addition, upon a Sale of the Client, Developer shall provide a purchaser a first
right to negotiate for continued development services of the Sonasoft Products
by Developer.
6. Developer
represents and warrants that the Microsoft Archiving Solution shall be completed
no later than ___________, 20__ (the “Completion Date”), subject to the
specifications of the Microsoft Archiving Solution not undergoing any change
prior to the Completion Date.
7. Developer,
upon execution of this Agreement and board approval by Client’s board of
directors, shall be granted options to purchase one hundred thousand and no/100
(100,000.00) shares of common, voting stock of Client at the then current fair
market value. Such options will commence on the date of board
approval, and shall vest over a period of thirty-six (36) months, so long as
Developer continues to provide development support for Client. In
addition, should the Microsoft Archiving Solution be completed on or before the
Completion date, Developer shall be issued an option for an additional
twenty-five thousand and no/100 (25,000.00) shares of common voting stock of
Client, at the then current fair market value. These additional
shares shall also vest over a thirty-six (36) month period, commencing upon the
Completion Date of the Microsoft Archiving Solution, and continuing so long as
Developer continues to provide development support to the Microsoft Archiving
Solution.
8. Xxxxxx
Xxxxx Jain, a principal of Developer, upon execution of this Agreement and board
approval by Client’s board of directors, shall be appointed to Client’s Board of
Advisors. In conjunction with such appointment, Developer will be
granted options to purchase fifty thousand and no/100 (50,000.00) shares of
common, voting stock of Client at the then current fair market
value. Such options will commence on the date of board approval, and
shall vest over a period of thirty-six (36) months, subject to the standard
terms of Client’s Board of Advisors Agreement.
9. The
non-statutory options granted to Developer, pursuant to the previous two
paragraphs, contain, among other provisions, a provision indicating that upon
the acquisition of Client by a third party under a stock or asset purchase, that
the vesting will accelerate, allowing the holder of the options to exercise the
purchase of all option stock for a limited period of time.
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10. It
is understood that, in developing the Microsoft Archiving Solution, Developer
will come into contact with source code and other intellectual property of
Client (“Confidential and Proprietary Information”) which includes, in addition
to the code, any information and data, oral or written, relating to the Sonasoft
Products and future products including but not limited to any concepts,
opinions, data, schedules, know-how, designs, technical, operating, costs,
process, business and programming information and techniques, business models,
competitive strategies, and any documents or record bearing media disclosing
such information or techniques which are observed by the Developer or disclosed
by or transmitted from Client to the Developer.
The
Developer shall treat all confidential or proprietary information in confidence
and shall protect the same with the same degree of care as that with which it
protects its own confidential or proprietary information. The
Developer shall not, in the absence of the Client’s prior written consent,
disclose confidential or proprietary information received from the Client to any
person except their own authorized employees who require the same in connection
with fulfilling the purposes of this Agreement. Any such employees
shall, prior to receiving any confidential and/or proprietary information, sign
a copy of an agreement containing these protective provisions and deliver it to
the Client. Notwithstanding the foregoing, the Developer shall have no
obligation with respect to any confidential or proprietary information
which:
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(a)
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is
already in the Developer’s possession;
or
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(b)
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is,
or becomes part of the public knowledge or literature through no wrongful
act of the Developer; or
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(c)
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is
approved for release in writing by the Client;
or
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(d)
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is,
or was developed independently or is furnished to a third party without a
similar restriction on the third party's rights;
or
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(e)
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is,
or was already in the public domain;
or
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(f)
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is,
or becomes the subject matter of a patent application which is later
abandoned; or
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(g)
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is
disclosed pursuant to the lawful requirement or request of a Government
Agency.
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Nonetheless,
the Client shall retain ownership of all title documentation, including notes,
drawings, manual drafts, etc., submitted to the Developer for
review. In addition, nothing in this Agreement is intended to grant
any rights under any patent or copyright of the Client.
11. All
code developed, utilized or implemented, except third party software agreed to
by Client, in the development of the Microsoft Archiving Solutions shall become
and/or remain the sole and exclusive property of Client. The complete
and total ownership of such software is a material part of this Agreement and
inducement for Client to enter into this Agreement.
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12. Developer
will be appointed as a distributor of Sonasoft Products in India and Africa, on
terms and conditions to be agreed upon in a Distribution
Agreement. It is anticipated that such agreement shall also delegate
the maintenance and support of Sonasoft Products to Developer, with an agreed
upon revenue sharing of the standard support and maintenance fee charge to
customers of Sonasoft Products.
13. Any
and all notices or other communications required or permitted by this Agreement
or by law to be served on or given to any party hereto, shall be in writing and
shall, except as otherwise expressly provided in this Agreement or by law, be
deemed duly served and given when personally delivered to the party to whom they
are directed, or in lieu of such personal service, when deposited in the United
States mail, first-class, postage prepaid, addressed to the party intended as a
recipient as follows:
DEVELOPER
Integra
Micro Systems (P) Ltd.
#0
00xx
Xx Xxxxx, Xxxxxxx Xxxx
Jakkur,
Bangalore 000 000
Xxxxxxxxx
XXXXX Attn:
Xxxxxx Xxxxx Jain
CLIENT
0000
Xxxxxx Xxxxxx
Xxxxx
000
Xxx Xxxx,
Xxxxxxxxxx 00000
U.S.A. Attn:
Xxxx Xxxxxx
14. All
questions with respect to the construction of this Agreement and the rights and
liabilities of the parties hereto shall be governed by the laws of the State of
California, U.S.A. Any disputes arising out of this Agreement shall
be governed submitted to the American Arbitration Association in San Francisco,
California, and shall be governed by their rules. Time is of the
essence of each and every provision of this agreement. Subject to any
restrictions against assignments herein contained, this Agreement shall inure to
the benefit of and be binding on the assigns, successors in interest,
personal representatives, estate, heirs, and legatees of each party
hereto.
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15. Developer
reserves the right to develop archiving software for platforms other than
Microsoft during the course of this Agreement or later, provided that such
development shall not use the Confidential and Proprietary Information of
Client.
16. Neither
Client nor any of its affiliates or agents will solicit any employee of
Developer who is or was involved in the development of the Microsoft Archiving
Solution, without the prior written consent of Developer.
17. This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original and all of which shall constitute one agreement
notwithstanding the fact that all parties are not signatories either on the same
date or to the same counterpart.
18. This
Agreement contains the entire understanding of the parties and constitutes the
sole and only agreement between them concerning the subject matter or the rights
and duties of any of them in connection with the items discussed in this
Agreement. Any agreements or representations among the parties hereto
not expressly set forth in this Agreement are null and void.
IN
WITNESS WHEREOF; this Agreement has been executed on the days and dates set out
below:
DEVELOPER
Integra
Micro Systems (P) Ltd.
By: /s/ Xxxxxx Xxxxx
Jain Date: November
1, 2007
Xxxxxx
Xxxxx Jain
CLIENT
By: /s/ Xxxx
Xxxxxx Date: November
1, 2007
Xxxx
Xxxxxx
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