Exhibit 99.8
CONFIDENTIAL TREATMENT
REQUESTED UNDER 17 C.F.R
Sections 200.80(b)(4),
200.83 and 240.24b-2
SOFTWARE ROYALTY, GRANT BACK AND
IMPROVEMENTS LICENSE AGREEMENT
This Software Royalty, Grant Back and Improvements License Agreement
(this "AGREEMENT") is made effective as of September 25, 1998 (the "EFFECTIVE
DATE") by and between SCIENCE APPLICATIONS INTERNATIONAL CORPORATION
("SAIC"), a Delaware corporation doing business at 00000 Xxxxxx Xxxxx Xxxxx,
Xxx Xxxxx, Xxxxxxxxxx 00000-0000 and ODS NETWORKS, INC. ("ODS"), a Delaware
corporation doing business at 0000 X. Xxxxxxx Xxxx, Xxxxxxxxxx, Xxxxx 00000.
WHEREAS, pursuant to an Asset and Securities Purchase Agreement between
the parties of even date herewith (the "PURCHASE AGREEMENT"), SAIC
transferred and assigned certain intellectual property rights and other
assets to ODS;
WHEREAS, SAIC wishes to obtain limited licenses from ODS with respect to
SAIC customers or licensees (as specified herein);
WHEREAS, the parties desire to provide one another with improvements to
certain software products; and
In consideration of the mutual promises hereinafter set forth and in the
Purchase Agreement, SAIC and ODS, intending to be legally bound, do hereby
agree as follows:
1. DEFINITIONS.
"AMIDS" means the Audit Monitoring and Intrusion Detection System software
program;
"CMDS" means the Computer Misuse and Detection System software program;
"CONVEYED ITEMS" means the software programs contained on the CD-ROMs
attached to EXHIBIT 1.1 (a) of the Purchase Agreement that are also known
as "Computer Misuse and Detection System" ("CMDS"), "Vulnerability
Assessment System" ("VAS"), "Audit Monitoring and Intrusion Detection
System" ("AMIDS") and "Malicious Code Detection and Eradication System"
("MCDES"), and the documentation pertaining to each of the foregoing
software programs;
"IMPROVEMENTS" means any material enhancements, modifications, or
customization made by or for SAIC or ODS to the principal functions and
features of AMIDS (principal functions and features: integration of
intrusion detection products to facilitate a common base for analysis and
reporting), CMDS (principal functions and features: detection of the misuse
of
internal computer network systems), MCDES (principal functions and
features: integration of malicious code detection and eradication tools to
facilitate a common base for analysis and reporting) or VAS (principal
functions and features: integration of vulnerability assessment tools to
facilitate a common base for analysis and reporting) that are developed
within the two (2) year period subsequent to the Effective Date and
specifically include any enhancements dealing with Year 2000 Compliance;
provided, however, that Improvements shall not include (a) any software
programs that incorporate AMIDS, CMDS, MCDES or VAS (i) without materially
modifying the principal functions or features of AMIDS, CMDS, MCDES or VAS
or (ii) whose primary function differs from the purpose of AMIDS, CMDS,
MCDES or VAS nor (b) any enhancements, modifications or customization made
for any government entities that have prohibitions relating to transfer of
such enhancements, modifications or customization, whether by contract or
by statute or federal regulation, until such prohibitions are lifted. Any
enhancement, modification or customization under (b) that becomes
transferable shall be deemed an Improvement as of the date that the
prohibition is no longer effective;
"MCDES" means the Malicious Code Detection and Eradication System software
program;
"VAS" means the Vulnerability Assessment System software program;
"YEAR 2000 COMPLIANT/COMPLIANCE" means that if all hardware and software
products used with a software program properly exchanges date data with
such software program, such software program will (i) handle date
information before, during, and after January 1, 2000, including but not
limited to accepting date input, providing date output, and performing
calculations on dates or portions of dates; (ii) function accurately and
without interruption before, during, and after January 1, 2000, without any
change in operations associated with the advent of the new century;
(iii) respond to two-digit year-date input in a way that resolves the
ambiguity as to century in a disclosed, defined, and predetermined manner,
and (iv) store and provide output of date information in ways that are
unambiguous as to century. Notwithstanding the foregoing, Year 2000
Compliance does not mean that (i) such software program will identify or
remedy Year 2000 problems in third party systems or other products or
applications not provided or supplied by the supplier, or (ii) the software
program will operate with the date information it receives; thus, if
incorrect date information is provided by the user, the system or from any
other external product or other source, this information will be used by
such software program software program as received. Year 2000 Compliance
does not include resolving problems caused by such external sources; and
"Y2K CUSTOMER" means any existing customers that SAIC may have an
obligation to provide a Year 2000 Compliant version of the Conveyed Items.
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2. CONVEYED ITEMS AND IMPROVEMENTS ROYALTY. Excepting any Conveyed Items
and/or Improvements for which SAIC receives a Finder's Fee as defined in
and pursuant to the PartnersPlus Agreement between the parties of even date
herewith, with respect to any license of or other grant of a right to use
any Conveyed Items and/or any Improvements or any portion thereof by the
United States Government that occurs on and after the date of this
Agreement and during the first two (2) years after the date of this
Agreement, ODS shall pay SAIC a royalty in an amount equal to [***] of all
amounts paid to ODS pertaining to such license or rights. ODS shall pay the
royalty to SAIC within ninety (90) days after the date that ODS invoices
the United States Government or ODS' customer, if the ODS customer is
invoicing the United States Government, with respect to any Conveyed Items
and/or any Improvements or any portion thereof. ODS shall not deliberately
bundle or market Conveyed Items and/or Improvements in a manner that is
designed to or that has the effect of lowering the royalty fees to be paid
by ODS to SAIC. If ODS or SAIC become aware of such effect, and ODS is
notified by SAIC of such effect or in the event ODS otherwise becomes aware
of such effect, ODS shall immediately take appropriate corrective action.
Upon providing reasonable advance notice to ODS, SAIC shall be entitled to
inspect ODS' books and records during ODS' normal business hours to audit
ODS' compliance with this provision for royalty payments.
3. DELIVERY OF IMPROVEMENTS. Each party shall deliver a copy of the Conveyed
Items containing any Improvements (the "IMPROVED CONVEYED ITEMS") to the
other party within ten (10) days of the occurrence of (a) the release of a
beta-version of the Improved Conveyed Items to a customer or prospective
customer, (b) the release of a commercial version of the Improved Conveyed
Items or (c) when any prohibition on the transfer of an Improvement is no
longer effective. In addition, each party shall provide the other with a
then current copy of any Improved Conveyed Items on the first day of the
ninth, eighteenth and twenty-fourth month following the date of this
Agreement.
4. GRANT OF LICENSES.
(a) SAIC CONVEYED ITEM LICENSES.
ODS hereby grants SAIC a worldwide, perpetual, royalty-free, non-
transferable, limited exclusive license to copy, modify, transfer, license
and market the Conveyed Items and any Improvements specified below to be
used in conjunction with the licensing, support, maintenance, enhancement,
modification or customization of said Conveyed Items and Improvements to,
and only to, the customers as follows:
(i) VAS, AMIDS and MCDES for the Defense Information System Agency
(DISA) under the Basic Ordering Agreement INFOSEC Technical Services
Contract (ITSC) No. DCA100-95-D-0104.
(ii) CMDS for the customer known by the parties as Ritz Premier;
(iii) CMDS to provide maintenance, upgrades and revisions of CMDS for
the customer whose identity is confidential (P.O. Numbers 4600004406,
4600005370
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*** Indicates that material has been omitted and confidential treatment
requested therefor. All such material has been filed separately with the
Commission pursuant to Rule 24b-2.
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and 4600003960); provided, however, that the license granted hereunder
shall not be perpetual but shall continue until the expiration of the
SAIC's obligations under the aforesaid purchase orders; and
(iv) CMDS to provide replacement copies of CMDS to any customer or
licensee of CMDS pursuant to any license, purchase order,
agreement, contract or other document entered by SAIC and such
customer or licensee prior to the date hereof.
; provided, however, that SAIC shall not issue new licenses of Conveyed
Items to the foregoing maintenance customers, any such new licenses shall
be provided pursuant to the PartnersPlus Agreement between the parties of
even date herewith.
(b) SAIC LICENSE TO YEAR 2000 COMPLIANT IMPROVEMENTS BY ODS.
With respect any Y2K Customers, to the extent that Year 2000 Compliant
Improvements are available from ODS, ODS hereby grants SAIC a worldwide,
perpetual, royalty-free, non-transferable, limited license to copy, modify,
transfer, license and/or provide any such Year 2000 Compliant Improvements
in conjunction with the licensing, support, maintenance, enhancement,
modification or customization of the software provided of or to the Y2K
Customer and for SAIC to undertake any activities deemed necessary by SAIC
or desirable with respect to the such Year 2000 Compliant Improvements to,
and only to, Y2K Customers.
(c) INTERNAL & CONSULTING SAIC CONVEYED ITEMS AND IMPROVEMENTS LICENSE.
(i) For a period of two (2) years following the date of this
Agreement, ODS hereby grants SAIC a worldwide, royalty-free, non-
transferable, limited license to copy, modify and use CMDS and any
Improvements to CMDS in conjunction with SAIC's (and SAIC's
subsidiaries and affiliates) internal computer systems.
(ii) For a period of two (2) years following the date of this
Agreement, ODS hereby grants SAIC's Software and Systems Group
("SAIC-SSG") a worldwide, royalty-free, non-transferable, limited
license to make up to fifty (50) copies of VAS and any Improvements
to VAS and to modify and use VAS and any Improvements to VAS in
conjunction with SAIC-SSG's performance of consulting, testing,
monitoring and evaluation services for customers or prospective
customers of SAIC-SSG, provided that the customer or prospective
customer is not permitted to retain any such copy of VAS and/or any
Improvements to VAS after the services have been performed by
SAIC-SSG.
5. OWNERSHIP OF IMPROVEMENTS To the extent assignable, ODS shall have sole
ownership of any Improvements. SAIC further agrees, at no expense to SAIC, to
execute or have executed any necessary documents, reasonably requested by ODS,
to perfect such ownership and to allow ODS to file copyright and/or patent
applications on such Improvements.
6. DISPUTES CONCERNING IMPROVEMENTS The parties recognize that they cannot
presently predict or determine everything in the future that may constitute an
enhancement, modification, or customization of the principal functions and
features of the Conveyed Items and
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therefore agree that in the event the parties disagree whether an Improvement
has been created and before the dispute is referred to arbitration, a vice
president or higher titled representative of each party will meet and bargain
in good faith for a period of not less than thirty (30) days in an effort to
resolve the disagreement.
7. EXCLUSIVE WARRANTIES.
(a) SAIC IMPROVEMENTS.
Any Improvements provided to ODS by SAIC pursuant to this Agreement are
provided "AS IS" with any and all faults and with no warranty against
title, patent, trademark, copyright, trade secret infringement or other
infringement of the rights of a third party.
(b) CONVEYED ITEMS AND IMPROVEMENTS PROVIDED BY ODS TO SAIC.
The Conveyed Items and Improvements provided to SAIC by ODS pursuant to
this Agreement are provided "AS IS" with any and all faults and with no
warranty against title, patent, trademark, copyright, trade secret
infringement or other infringement of the rights of a third party. SINCE
ODS RECEIVED THE CONVEYED ITEMS VIA THE PURCHASE AGREEMENT FROM SAIC, ODS
MAKES NO REPRESENTATION OR GUARANTEE WHATSOEVER WITH RESPECT TO THE
CONVEYED ITEMS OR IMPROVEMENTS LICENSED TO SAIC PURSUANT TO THIS AGREEMENT
AND ODS SPECIFICALLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY OR FITNESS
FOR ANY PARTICULAR PURPOSE.
(c) MUTUAL PROVISIONS CONCERNING IMPROVEMENTS.
WITH RESPECT TO IMPROVEMENTS, NEITHER PARTY MAKES ANY REPRESENTATION OR
GUARANTEE WHATSOEVER WITH RESPECT TO ANY IMPROVEMENT AND EACH PARTY
SPECIFICALLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR ANY
PARTICULAR PURPOSE AS TO THE IMPROVEMENTS.
8. EXPORT REGULATION. The export of commodities or technical data from the
United States of America and/or the re-export from foreign countries of
commodities or technical data or direct products of technical data of
United States of America origin, may be conditioned upon the issuance of an
export license by the government of the United States of America. Each
party represents that it will not export or re-export any commodities or
technical data or direct products of technical data in furtherance of this
Agreement unless and until it has complied in all respects with the United
States of America Export Control Regulations and all applicable laws and
regulations concerning the Conveyed Items or Improvements.
9. ARBITRATION OF DISPUTES. The parties agree that any controversy or claim
(whether such controversy or claim is based upon or sounds in statute,
contract, tort or otherwise) arising out of or relating to this Agreement,
any performance or dealings between the parties, or any dispute arising out
of the interpretation or application of this Agreement, which the parties
are not able to resolve, shall be settled exclusively by arbitration in
Dallas, Texas by a single arbitrator pursuant to the American Arbitration
Association's Commercial
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Arbitration Rules then in effect and judgment uponthe award rendered
by the arbitrator shall be entered in any court having jurisdiction
thereof and such arbitrator shall have the authority to grant
injunctive relief in a form similar to that which a court of law would
otherwise grant. The arbitrator shall be chosen from a panel of licensed
attorneys having at least fifteen (15) years of professional experience who
are familiar with the subject matter of this Agreement. The arbitrator
shall be appointed within thirty (30) days of the date the demand for
arbitration was sent to the other party. Discovery shall be permitted in
accordance with the Federal Rules of Civil Procedure. If an arbitration
proceeding is brought pursuant to this Agreement, the prevailing party
shall be entitled to recover reasonable attorneys' fees, costs and
necessary disbursements incurred in addition to any other relief to which
such party may be entitled.
10. CHOICE OF LAW. The Agreement and the performance or breach thereof shall
be governed by and interpreted as to substantive matters in accordance with
the applicable laws of the State of Delaware (excluding its choice of law
rules).
11. ASSIGNMENT. No portion of this Agreement or any right or obligation
hereunder can be assigned, in whole or in part, by either party hereto
without the prior written consent of the other party.
12. WAIVER. No waiver of, no delay in the exercise of, and no omission to
exercise any rights or remedies by either party shall be construed as a
waiver by such party of any other rights or remedies that such party may
have under this Agreement.
13. NOTICE. Unless otherwise specified herein, any notice required or
permitted to be given under this Agreement shall be sufficient, if in
writing, and shall be deemed to be fully given if personally delivered, if
sent by registered mail, by facsimile with an original copy by regular
mail, or by telex with receipt acknowledged, to the following addresses:
If to SAIC, to:
Xxxxxxx X. Xxxxxxx, Senior Vice President
Science Applications International Corporation
00000 Xxxxxx Xxxxx Xxxxx, X/X X0-X
Xxx Xxxxx XX 00000
FAX: 000-000-0000
With a copy to:
Xxxxx X. Xxxxxx, Esq.
Associate General Counsel
Science Applications International Corporation
00000 Xxxxxx Xxxxx Xxxxx, X/X X0
Xxx Xxxxx XX 00000
FAX: 000-000-0000
If to ODS, to:
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X. Xxxx Xxxxxx
Chairman, President and Chief Executive Officer
ODS Networks, Inc.
0000 X. Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxx 00000
FAX: 000-000-0000
The foregoing addresses and individuals may be changed by either party
by giving to the other party prior written notice of any such change.
14. THIRD PARTIES. Nothing herein expressed or implied is intended or shall be
construed to confer upon or give to any person or corporation other than
the parties hereto and their successors or assigns, any rights or remedies
under or by reason of this Agreement.
15. FURTHER ASSURANCES. Each of the parties hereto agrees that from time to
time, at the request of any of the other parties hereto and without further
consideration, it will execute and deliver such other documents and take
such other action as such other party may reasonably request in order to
consummate more effectively the transactions contemplated hereby.
16. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
the parties concerning the subject matter hereof and may only be modified
by a written instrument executed by an authorized officer of both parties.
All proposals, negotiations and representations (if any) made prior, and
with reference to the subject matter of this Agreement, are merged herein.
This Agreement may be executed in two (2) or more counterparts and each
counterpart will be deemed an original, but all counterparts together will
constitute a single instrument. This Agreement has been negotiated by the
parties and their respective counsel and will be interpreted fairly in
accordance with its terms and without any strict construction in favor of
or against either party. Neither SAIC nor ODS shall be bound by any oral
agreement or representation, irrespective of when made.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the first date written above.
SCIENCE APPLICATIONS ODS NETWORKS, INC.
INTERNATIONAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx By: /s/ X. Xxxx Xxxxxx
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Name: Xxxxxxx X. Xxxxxxx Name: X. Xxxx Xxxxxx
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Title: Senior Vice President Title: President
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