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Monday, August 09, 1999
Xx. Xxxx Xxxx
Director, Product Innovation Lab
Samsung Electronics
000 Xxxxxxxxxx Xxxx
Xxxxxxxxxx Xxxx, XX 00000
Subject: Summus Ltd. and High Speed Net Solutions (HSNS) Relationship
Dear Xxxx:
Per your request the following letter outlines the relationship between Summus
Ltd. and HSNS as it relates to our current discussions with Samsung.
Summus and HSNS have signed a Marketing License Agreement (MLA) which provides
to HSNS certain exclusive and non-exclusive marketing rights to selected
products. These products include the current version of: 1) wavelet still image
"4U2C"; 2) video e-mail "MaxxNotes"; 3) wavelet streaming video. Rights vary by
product, for example, HSNS has exclusive rights for "Direct Marketing" of video
e-mail, and a non-exclusive marketing right in other channels. There are further
clauses which set terms and conditions for OEM deals and allow HSNS to bring
technology deals to Summus. At all times, Summus retains ownership and control
of it's technology, and sets the terms and conditions for sub-licensing.
In the case of Samsung, Summus and HSNS have entered into an additional brief
agreement stipulating that HSNS brought the Samsung opportunity forward, and
they will receive compensation in the form of an "agents" agreement of
approximately 18% of revenue from Samsung for items not covered by the MLA. HSNS
has no license rights or sub-license rights to enter into technology agreements.
They may only handle products as defined in the agreement.
Therefore, Xxxxxx and HSNS are cooperating to "win" the Samsung business. HSNS
will be appropriately compensated for bringing forward the opportunity. But, all
technology agreements must be negotiated with Summus and any agreement with
Samsung will be signed by all three parties.
Regarding the e-mail from Mr. Xxxxxxxxx Park, it was inappropriate for him to
comment on the Summus proposal. Xx. Xxxx is not a principal or executive in
either Summus or
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HSNS. Xx. Xxxx has entered into an agreement with HSNS to receive a "finders
fee" for the Samsung opportunity equivalent to 4% of revenue. Xx. Xxxx is not
our representative nor intermediary and should not receive copies of our
confidential proposals or communications. Xx. Xxxx has not executed nor will he
be granted a Confidential Disclosure Agreement with Summus Ltd.
At the appropriate time, we would be glad to provide you copies of any existing
agreements as necessary.
We hope that this information meets your requirements and that you will continue
to favorably view the Summus Proposal of August 6, 1999.
Please feel free to contact me with any questions.
Sincerely,
/s/ X.X. Xxxxxxxxxx /s/ Xxxxxxx X. Xxxxxx
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X. Xxxxxxxx Xxxxxxxxxx Xxxxxxx Xxxxxx
Chief Executive Officer Chairman
Summus Ltd. High Speed Net Solutions, Inc.
Cc: Xx. Xxxxx Xxxxxxx
