EXHIBIT 10.2
VISUAL INFORMATION SERVICES CORP. AND DIGITAL SCIENCES INC.
TECHNOLOGY LICENSE AGREEMENT
This Technology License Agreement ("Agreement") made and entered into as of
the 1st day of January, 1995, by and between VISUAL INFORMATION SERVICES CORP.,
an Illinois corporation (hereinafter referred to as "VisCorp"), with offices at
0000 Xxxxx Xxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000, and DIGITAL SCIENCES, INC., a
Nevada corporation (hereinafter referred to as "Digital"), with offices at 0000
Xxxx Xxxxxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxx 00000.
RECITALS
A. VisCorp is the proprietor of certain technology as hereinafter
defined and of certain letters patent as hereinafter defined.
B. Digital desires to acquire and VisCorp is willing to grant to
Digital a license of the technology subject to the terms and conditions set
forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals and the provisions of
this Agreement, the parties agree as follows:
1. DEFINITIONS. As used in this Agreement, unless the context
requires otherwise, the following expressions have the following meanings:
a. "Confidential Information" means all material, information,
and techniques pertaining to the inventions and processes constituting the
technology which is not protected by the letters patent.
b. The "Technology" and the "Licensed Product" mean the
electronic set top converter box ("ED"), which allows a user to interact with
programming transmitted to a television set using the "ED" operating system,
including Software and related equipment for providing Licensed Services.
c. "Software" shall mean the software products developed by
Digital Sciences for use, onsite, and offsite, with the Technology of VisCorp.
d. "License Fee" shall mean the fee charged by VisCorp to
Digital for the right to use the technology in accordance with this Agreement.
e. "Licensee Product" shall mean the product which has been
developed by Digital for use, onsite and offsite, with the Technology of
VisCorp.
f. "Gross Revenue" shall mean:
(i) In the case of the Technology and Licensed
Product, the net amount received by Digital (less freight,
insurance, taxes, commissions).
(ii) In the case of Licensed Services, the net amount
received by Digital by whomever paid, whether health care
providers, nursing homes, advertisers, programmers, promoters,
viewers, or other persons.
(iii) Sales of Technology and Licensed Product and
Licensed Services shall be deemed to occur when paid for.
g. "Letters Patent" shall mean U.S. Patent No. 014752-000100
and U.S. Patent No. 014752-000200.
h. "Licensed Services" shall mean services available for use on
the Licensed Product and Technology platform as currently known or any future
derivation, enhancement, improvement, or modification of the Technology and
Licensed Product, including, but not limited to:
(i) In case of viewers - telephone, satellite or cable
deliveries, services and functions, including home shopping,
direct response marketing, and dissemination of information;
participation in two-way interactive computerized broadcast
games, including board and card games, trivia games, and play-
along games; connection to online services, voice chat programs, and the
Internet.
(ii) In the case of commercial users, the provision of the
Licensed Product and Technology.
i. A reference to a person includes a reference to a
corporation and vice versa and the single tense means and includes the plural,
and gender means and includes all other genders.
j. Clause headings contained in this Agreement are to be
disregarded in the construction of any provision of this Agreement.
k. "Health Care Industry"' shall mean all facilities and
individuals that provide health care services, including hospitals, clinics,
nursing homes, physicians, chiropractors, osteopathic physicians, podiatrists,
and dentists. The Health Care Industry does not include any services in
individuals' homes or home health care services, whether provided by physicians
or nurses.
2. GRANT OF LICENSE. VisCorp hereby grants to Digital during the
term hereof an exclusive license to purchase from VisCorp and utilize the
Technology and Licensed Product solely within the health care industry within
the United States of America and Canada for the purpose of the sale, marketing,
and networking of the Technology, Licensed Product, and
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Licensed Services. Marketing, sales, and networking of the Technology, Licensed
Product, and Licensed Services shall be made by Digital only within the health
care industry within the territory of the United States of America and Canada.
VisCorp also grants to Digital during the term of this Agreement an exclusive
license within the health care industry within the United States of America and
Canada of all trademarks and copyrights owned by VisCorp associated with
Licensed Product and Licensed Services, such as trademarks of "Tel Ed", "Play
Ed", and "Club Ed". Certain trademarks of NTN games are part of the Licensed
Services and utilized by VisCorp pursuant to a non-exclusive license agreement.
a. SCOPE OF LICENSE. The License of the Technology and
Licensed Product granted to Digital shall be non-exclusive except for sales and
marketing within the health care industry within the territory of the United
States of America and Canada of the Technology and Licensed Product. No other
license of the Technology, Licensed Product, and Licensed Services for any other
purposes is granted by this License Agreement. The license granted shall be
exclusive for the purposes for the term and within the health care industry
within the United States of America and Canada with the exception of all NTN
games which are utilized by VisCorp pursuant to a non-exclusive license.
VisCorp may grant other Licenses of the Technology, Licensed Product, and
Licensed Services outside the scope of this license.
b. SUBLICENSES. Digital may enter into contracts with
contractors for the technical implementation of the rights granted herein. Each
such contract shall provide for technical implementation of the Technology in
accordance with standard specifications to be provided by VisCorp. Each such
contract must provide for a covenant by the contractor for the benefit of
VisCorp and Digital, in form and substance approved by VisCorp, to keep all
proprietary information concerning the Technology, Licensed Product and Licensed
Services confidential. Such covenant shall be in the form attached hereto as
Exhibit "B" and shall require employees of the contractor who receive
confidential information to sign a confidentiality agreement in the form
attached hereto as Exhibit "A".
c. Digital may utilize pre-existing software, hardware, and
programming, and contract for and originate software, hardware, and programming,
whether onsite or offsite, for use and application with the Technology, Licensed
Product, and Licensed Services, and Digital grants to VisCorp a license to all
such Licensee Product, Software, hardware, and programming, onsite and offsite,
for any purpose outside of the scope of Digital's license, in exchange for the
license to use and receive all of VisCorp's upgrades, enhancements,
modifications, improvements and replacements of the Technology and Licensed
Product during the term of this Agreement.
3. USE OF TECHNOLOGY. Digital shall utilize its best efforts
consistent with its good faith business judgment to market the Technology,
Licensed Product, and Licensed Services. Digital represents, warrants, and
agrees that it will not utilize the Technology, Licensed Product, and Licensed
Services other than for the purposes stated herein and, except as provided
herein, Digital shall not knowingly permit any other person or entity to use the
Technology, Licensed Product, or Licensed Services for any purpose.
The Technology, Licensed Product, and Licensed Services are
proprietary to VisCorp and title thereto shall remain exclusively with VisCorp
throughout the term of this
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Agreement. All applicable rights to patents, patent applications, copyrights,
trademarks, trade secrets, software applications, hardware applications, or any
part thereof and any enhancements or modifications thereto developed by VisCorp
or any other person are and shall remain the exclusive property of VisCorp
subject to written licenses granted by VisCorp.
Digital agrees not to attempt to create or derive derivative
works competitive with the Technology, Licensed Product, and Licensed Services,
source codes, or improvements to the Technology, Licensed Product, and Licensed
Services provided by VisCorp by disassembly, reverse engineering, decompiling,
or any other method without the express written consent of VisCorp, and Digital
shall take reasonable steps necessary to prevent third parties, including
without limitation, end-users, from disassembly, reverse engineering, and the
like.
4. TRANSFER OF TECHNOLOGY. Digital shall not assign, transfer,
sublicense, or allow any person or other entity to utilize the Technology,
Licensed Product, and Licensed Services, except as provided herein, without the
express consent of VisCorp.
5. TERM.
a. INITIAL TERM. Subject to the provisions of this Agreement,
the term of this Agreement in respect of the use of the Technology, Licensed
Product, and Licensed Services shall commence on the execution of this Agreement
by both parties and shall continue for a period of ten (10) years thereafter.
Notwithstanding the royalty commencement date, this Agreement shall commence on
the date of execution.
b. NEGOTIATION OF EXTENDED TERM. If Digital, during the term,
has fully and punctually paid all license fees and royalties and has duly
performed and observed all obligations of Digital, expressed or implied, in this
Agreement, then VisCorp shall negotiate in good faith with Digital, if so
requested by Digital in writing to VisCorp at least ninety (90) days prior to
the expiration of the third year of the term for a renewal of this Agreement for
a further period of time past the initial ten (10) year term on terms mutually
agreeable to the parties.
c. TERMINATION. Either party may terminate this Agreement at
any time in the event of a material breach by the other party which remains
uncured after ninety (90) days notice thereof; or at any time for any reason on
ninety (90) days prior written notice, such termination to be effective after
the end of the Initial Term. Upon termination of the license granted hereunder:
(i) Digital shall promptly pay all amounts provided
for herein whether royalties or other amounts within thirty (30)
days together with interest at the prime rate of interest plus
two percent per annum on amounts then due from the due date.
(ii) Digital shall immediately cease any utilization of
the Technology, Licensed Product, and Licensed Services and shall
cease marketing, selling, syndicating, developing, broadcasting,
and producing the Technology, Licensed Product, and Licensed
Services and any
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trademarks or copyrights associated with the Licensed Product or
Licensed Services, such as the trademark of "Tel Ed", "Play Ed",
"Club Ed", or similar rights.
d. SURVIVAL. Representations, warranties, and indemnities of
the parties and the obligations of the parties regarding confidentiality
provided herein shall survive termination of this Agreement.
6. GOVERNMENTAL APPROVAL.
a. RESPONSIBILITY FOR OBTAINING GOVERNMENTAL APPROVAL. Digital
acknowledges that it is responsible for obtaining any necessary governmental
permission, license, or approval for utilization of the Technology, Licensed
Product, and Licensed Services within the health care industry and within any
State or territory of the United States of America and Canada. Digital shall
exert its best efforts to obtain all appropriate governmental licenses, permits,
and approvals pertaining to the utilization of the Technology, Licensed Product,
and Licensed Services and VisCorp shall fully cooperate with Digital to obtain
all necessary licenses, permits, and approvals.
7. PAYMENTS.
a. LICENSE FEE AND PAYMENT TERMS. In exchange for the license
granted herein by VisCorp to Digital, Digital shall transfer, assign, and convey
two hundred fifty thousand (250,000) shares of unregistered common stock of
Digital to VisCorp. Within 180 days of the date of this Agreement, Digital will
deliver VisCorp free and clear of all encumbrances, certificates for two hundred
fifty thousand (250,000) shares. Digital agrees that VisCorp may piggy-back
upon any future security registrations and Digital shall pay all expenses of
VisCorp thereof. Upon registration Digital represents and warrants that the two
hundred fifty thousand (250,000) shares will be duly authorized and available
for free trading. Digital represents and warrants that it has no subsidiaries
and that the aggregate number of shares which Digital is authorized to issue is
12.5 million common shares of which 4.5 million shares are issued and presently
outstanding. All such issued shares have been validly issued and are fully paid
and nonassessable.
Digital warrants that it has full right and authority to transfer
said shares to VisCorp.
Within forty-five (45) days, Digital shall deliver to VisCorp
copies of any financial statements which are complete and have been prepared in
accordance with generally accepted accounting principles.
(i) Most recent Financial Statement and Balance sheet
certified by Digital's CPA and Digital's treasurer, each of which
represents a true and complete statement as of its date of
Digital's condition, financial and otherwise.
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(ii) Statements of Digital's profit and loss accounts,
including, without limitation, all taxable income of every
nature, certified by Digital's CPA and Digital's treasurer, each
of which accurately represents the results of Digital's
operations for the period indicated.
(iii) Last certified annual report.
Digital represents it is the issuer of the two hundred fifty
thousand (250,000) shares of Digital which are fully paid and nonassessable and
Digital has a right to issue the two hundred fifty thousand (250,000) shares
free of all encumbrances and VisCorp shall receive good and marketable title to
such shares.
b. USAGE FEES FOR LICENSED SERVICES. For the Licensed Services
described in this Agreement, including "Tel Ed", "Play Ed", and "Club Ed",
Digital shall pay VisCorp a percentage of the online usage revenue, as defined
herein, generated by the use of the Licensed Services, broadcast to end users.
The online usage revenue shall be equally distributed to Digital and VisCorp.
Online usage revenue shall mean the greater of a specific charge per event or
usage or a prorated percentage of subscription fees based on usage, excluding
amounts received for taxes, duties, or valid charges. Digital shall provide
VisCorp with statements detailing the amount of usage for each calendar quarter.
Digital shall keep VisCorp advised as to any change in hourly or other charges
and as to any free hours. The terms of this section are subject to
renegotiation as it applies to any "Play Ed" games in the event that VisCorp
must pay a licensing fee to a third party which would make the provision of said
game economically detrimental to VisCorp.
c. PAYMENT OF USAGE ROYALTIES FOR LICENSED SERVICES. Royalties
shall be payable by Digital to VisCorp on or before the forty-fifth (45th) day
following each calendar quarter with respect to all sales of Licensed Services
occurring during the previous quarter. On or before the forty-fifth (45th) day
following each calendar quarter, Digital shall provide VisCorp with a royalty
report which shall identify the Licensed Services sold, the party for whom the
Licensed Services were rendered, the gross xxxxxxxx for each Licensed Services,
the amount billed and received, and identification of each invoice. Receipt and
acceptance of sums paid hereunder shall not preclude VisCorp from thereafter
claiming that additional royalty payments are due.
d. RECORDS. Digital agrees to keep and maintain accurate
records of the sales of Licensed Product and Licensed Services, which shall
include a description of each Licensed Product, the number of units sold, the
gross xxxxxxxx of each unit sold, the Licensed Services, the party for whom such
Licensed Services were rendered, the gross xxxxxxxx for each Licensed Service,
and an identification of each invoice for the sale of Licensed Product or
Licensed Services and a copy of each such invoice. VisCorp or its
representatives may, during normal business hours, and upon reasonable notice,
inspect such records. Notice of five (6) business days shall be deemed
reasonable notice. If such inspection reveals any deficiencies in the payments
of royalties due pursuant to this Agreement, Digital shall immediately pay
VisCorp the amount of such deficiency plus interest on the deficiency at the
rate of prime plus two percent per annum from the date of the deficiency, and,
if the deficiency is two percent (2%)
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or more of royalty payments for the period audited, Digital shall reimburse
VisCorp for all of its costs and expenses incurred with respect to the
inspection of Digital's records.
e. CONTINUATION OF PAYMENT. All of the provisions of this
Agreement and Digital's obligation to make royalty payments and all other
payments pursuant to this Agreement shall continue, notwithstanding any
determination that the Technology and Licensed Product is not patentable or is
in the public domain provided that VisCorp exerts its best efforts to maintain
the Technology, Licensed Product and Licensed Services as a trade secret, and
continues to assist Digital in utilizing the Technology and Licensed Product and
Licensed Services.
f. ADVERTISING REVENUES. In the event that either Digital or
VisCorp sells sponsorship of any portion of the "Tel Ed", "Play Ed", or "Club
Ed" services to a third party, the party which sells such a sponsorship shall
receive a royalty to be mutually agreed upon, but not to be less than seventy
percent (70%) of the advertising revenue derived from the sale of that
sponsorship. Neither party shall sell nor solicit the sale of any sponsorship
of any portion of the "Tel Ed", "Play Ed", or "Club Ed" service without the
reasonable prior written approval of the other party. Prior to the sale of any
sponsorship, Digital and VisCorp shall cooperatively set and agree in writing to
the rates to be charged for sponsorship of any portion of the "Tel Ed", "Play
Ed", or "Club Ed" service. Each party reasonably reserves the right to refuse
any sponsorship which in its discretion it determines to be not suitable for the
"Tel Ed", "Play Ed", or "Club Ed" service.
g. PRIZES. Five percent (5%) of online usage revenue will be
reserved for prizes before fee computation for all "Play Ed" games.
8. TECHNICAL ASSISTANCE.
Each party will provide a reasonable level of technical
assistance.
a. Upon request and subject to availability, each party shall
make available technical help and assistance and will reimburse the other party
at the rate of Sixty Dollars ($60.00) per hour (such rate to be adjusted each
calendar year for inflation) for all such support services and will pay all
reasonable business related expenses, including travel expenses, meals, lodging,
telephone, fax, and postage associated with the technical support.
b. PROTOTYPES. Within fourteen (14) days after execution of
this Agreement, VisCorp shall provide three prototype "ED" units and necessary
technical assistance to enable Digital to conduct testing. VisCorp shall
provide Digital with any prototypes, interactive units and remotes, and
promotional videotapes and cassettes as developed by VisCorp. Each party will
provide reasonable levels of training to the other party's technical,
administrative, and marketing staff provided that the requesting party pays the
cost of the other party's staff, such as airfare, accommodations, salary or
wages, and the like. Each party shall cooperate and assist the other party in
promptly answering questions and complaints from the parties' customers,
subscribers, and end users regarding the Licensed Product, Licensed Services,
Software, and Licensee's Product.
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9. REPRESENTATIONS, WARRANTIES, AND COVENANTS.
a. VisCorp represents, warrants, and covenants as follows:
(i) VisCorp has full power and authority to execute
this Agreement and conform to its provisions.
(ii) This Agreement does not violate any agreement or
covenant to which VisCorp is subject.
c. VisCorp has not granted any license for the use of
the Technology, Licensed Product, or Licensed Services for the
specific purposes described herein within the United States of America
and Canada, except for the license granted hereunder. VisCorp has
been issued two (2) patents for the Technology. Certain games
provided as Licensed Services are utilized by VisCorp pursuant to a
non-exclusive license agreement.
b. Digital represents, warrants, and covenants and follows:
(i) Digital has full power and authority to execute
this Agreement and conform to its provisions.
(ii) This Agreement does not violate any agreement or
covenant to which Digital is subject.
(iii) Digital acknowledges that all enhancements,
improvements, modifications, replacements, or continuations with
respect to the Technology, Licensed Product, and Licensed
Services, whether developed by VisCorp, Digital or others, is and
shall be deemed part of the Technology, Licensed Product, and
Licensed Services owned by VisCorp and accordingly shall be
subject to the provisions of this Agreement.
(iv) Digital shall not knowingly permit or allow the
utilization of the Technology, License Product, or Licensed
Services within the territory for any purpose by any other person
except to the extent specifically permitted by this Agreement.
(v) Digital shall not knowingly allow or permit any
sale of Licensed Product, Licensed Services, or the Technology
outside of the United States of America and Canada and outside of
the health care industry as defined in this Agreement.
(vi) Digital shall promptly inform VisCorp of any
disclosure of confidential information of which Digital becomes
aware by any party required to maintain the confidentiality of
such information
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hereunder, any possible infringement of any Letters Patent or any
other proprietary right with respect to the Technology, Licensed
Product, and Licensed Services by a third party.
c. VISCORP MAKES NO AND DIGITAL ACKNOWLEDGES THAT VISCORP HAS
NOT MADE ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING THE
TECHNOLOGY, LICENSED PRODUCT, OR LICENSED SERVICES, INCLUDING ANY IMPLIED
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND IMPLIED
WARRANTIES ARISING FROM COURSE OF DEALING OR COURSE OF PERFORMANCE. WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, VISCORP SPECIFICALLY DISCLAIMS ANY
WARRANTY REGARDING THE PROFITABILITY OF THE TECHNOLOGY, LICENSED PRODUCT, OR
LICENSED SERVICES.
d. DIGITAL MAKES NO AND VISCORP ACKNOWLEDGES THAT DIGITAL HAS
NOT MADE ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING
DIGITAL'S SOFTWARE, HARDWARE, PROGRAMMING, OR ITS OPERATION, INCLUDING ANY
IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND
IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR COURSE OF PERFORMANCE.
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING. DIGITAL SPECIFICALLY
DISCLAIMS ANY WARRANTY REGARDING THE PROFITABILITY OF ITS SOFTWARE, HARDWARE, OR
PROGRAMMING.
e. LIMITATION OF LIABILITY. UNDER NO CIRCUMSTANCES SHALL
EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ANY USER OF THE TECHNOLOGY,
LICENSED PRODUCT, OR LICENSED SERVICES FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL,
SPECIAL, OR EXEMPLARY DAMAGES FOR REASONS, SUCH AS, BUT NOT LIMITED TO, LOSS OF
REVENUE, LOSS OF PROFITS, OR LOST BUSINESS.
10. INFRINGEMENT.
a. INFRINGEMENT ON TECHNOLOGY. If any Letters Patent, patent
applications, or any other proprietary right with respect to the Technology,
Licensed Product, or Licensed Services be infringed and should that infringement
be to the business detriment of Digital, upon written notice of such alleged
infringement from Digital, VisCorp may, but shall not be required to, at its own
expense, prosecute or settle any action necessary to protect the rights of the
parties under this License Agreement. If VisCorp fails to act after forty-five
(45) days of notice of such alleged infringement by Digital to VisCorp or
notifies Digital in writing in a lesser time that it does not intend to act,
then Digital shall have the privilege, but not be obligated, to prosecute or
settle any such action in the name of the appropriate party, including the name
of VisCorp, at Digital's sole cost and expense.
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VisCorp shall be afforded up to forty-five (45) days to
investigate the alleged infringement and to determine whether or not in
VisCorp's opinion there is actual infringement.
Any judgment or settlement proceeds shall be received by the
prosecuting party.
b. INFRINGEMENT CLAIMS AGAINST THE TECHNOLOGY. If any action
is commenced against VisCorp or against Digital or any customer of Digital which
alleges that the Technology, Licensed Product, or Licensed Services infringes or
violates the rights of others, or that VisCorp is not entitled to license the
Technology, Licensed Product or Licensed Services, or that Digital is not
authorized to utilize the same, then Digital shall give fifteen (15) days notice
to VisCorp requesting VisCorp to defend such action. If VisCorp accepts the
defense of such action, Digital shall, at its own expense, be entitled to
non-controlling participation through its own counsel. If VisCorp fails to
accept the defense of such action, then Digital may, at its election, defend
such action, in which event all the costs of such defense, including reasonable
attorney fees, may be deducted by Digital from royalty payments and usage
royalties due hereunder to VisCorp.
11. INDEMNITY.
a. VISCORP'S INDEMNITY. Subject to the provisions of Digital's
indemnity, VisCorp shall indemnify, defend, and hold Digital harmless from and
against any and all claims, liability, expenses, damages, and costs due to the
breach of VisCorp's representations and warranties made pursuant to the
provisions of this Agreement.
b. Digital shall indemnify, defend, and hold VisCorp harmless
from and against any and all claims, liabilities, expenses, damages, and costs
due to injury, to persons or property arising or resulting from Digital's
utilization, marketing, or sale of the Technology, Licensed Product, and
Licensed Services pursuant to the provisions of this Agreement, except for those
claims, liabilities, expenses, damages, and costs occasioned by the negligence,
error, or omission, or material breach of the terms of this Agreement of or by
VisCorp or derived from a claim successfully asserted that the Letters Patent,
patent applications, the Technology, Licensed Product, or Licensed Services
infringe upon the rights of the party asserting the claim.
12. CONFIDENTIAL INFORMATION.
a. DISCLOSURE OF CONFIDENTIAL INFORMATION. Digital agrees not
to disclose any "Confidential Information" to persons other than the
contractors, its own employees, consultants, and advisors who have a "need to
know" the Confidential Information incident to utilizing the Confidential
Information for the purpose of producing, marketing, or selling the Technology,
Licensed Product, or Licensed Services, except pursuant to administrative or
judicial subpoena for testimony or production of documents. Digital shall
require each employee to whom Digital discloses Confidential Information to
execute prior to disclosure a Confidentiality Agreement agreeing to maintain and
not disclose any Confidential Information in the form attached hereto as Exhibit
"A". Digital shall require every other person to whom Digital discloses
Confidential Information to execute prior to disclosure a
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Confidentiality Agreement agreeing to maintain and not disclose any Confidential
Information in the form attached hereto as Exhibit "B".
b. USE OF CONFIDENTIAL INFORMATION. Digital shall not use or
authorize others to use any of the Confidential Information except for the
purpose of producing, marketing, and selling the Technology, Licensed Product,
and Licensed Services.
c. DEVELOPMENTS, IMPROVEMENTS, AND ENHANCEMENTS. Each party
shall promptly disclose to the other party on a confidential basis all
developments, improvements, enhancements, information, and techniques learned or
developed by such party incident to utilizing the Technology, Licensed Product
and Licenses Services of VisCorp, and the Software, hardware, or programming
developed by Digital for use with the Technology, License Product, and Licensed
Services. Digital grants to VisCorp and to VisCorp's licensees a nonexclusive
license to utilize such developments, improvements, enhancements, information,
and techniques. The license to VisCorp and to VisCorp's licensee shall continue
and survive the termination of this Agreement.
d. LIQUIDATED DAMAGES AND INJUNCTIVE RELIEF. Digital
acknowledges that the covenants contained in Section 2, prohibiting marketing
and sales outside of the health care industry and outside of the United States
of America and Canada and the disclosure and use of Confidential Information as
prohibited in Sections (a) and (b) of Section 12, are crucial to the interests
of VisCorp and that violation of such covenants would cause irreparable damage
to VisCorp. Accordingly, Digital agrees that in the event of violation of the
covenants of Digital contained in Sections 2, 12(a), or 12(b), of this
Agreement:
(i) Digital shall pay VisCorp the amount of
twenty-five percent (25%) of the revenues from the sale of
products and services utilizing the Technology, Licensed Product,
and Licensed Services as a result of a violation of this
Agreement by Digital which payment shall be a payment of
liquidated damages and not a penalty, actual damages being
difficult or impossible to determine; and
(ii) VisCorp may seek and obtain restraining orders and
injunctions, both permanent and temporary in nature, which would
prohibit any breach of any covenant contained in Sections 2,
12(a), or 12(b) of this Agreement.
13. GENERAL PROVISIONS.
a. COMPLIANCE WITH LAW. VisCorp and Digital shall comply with
all applicable laws and regulations, the violation of which would materially
jeopardize or damage the fulfillment of such party's obligations under the terms
of this Agreement. In the event that any provision of this Agreement conflicts
with the law under which this Agreement is to be construed or if any such
provision is held invalid by a court with jurisdiction over the parties to this
Agreement, such provision shall be deemed to be restated to reflect as nearly as
possible the original intentions of the parties in accordance with applicable
law and the remaining provisions of this Agreement shall remain in full force
and effect.
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b. LIABILITY OF VISCORP. Provided that VisCorp performed its
duties hereunder, VisCorp shall not be liable to Digital for any inability by
Digital to successfully utilize, sell, or market the Technology, Licensed
Product, or Licensed Services.
c. This Agreement sets forth the entire agreement of the
parties with respect to the subject matter hereof, integrates all prior
understandings and agreements of the parties with respect to the subject matter
hereof and may not be altered, amended, or modified in any manner except by a
written agreement signed by the parties.
d. PATENT, TRADEMARK, AND COPYRIGHT NOTICES. Digital shall
place the following notice on all retail packages containing the Technology and
Licensed Product: "XX -XX- interactive television technology used under license
from Visual Information Services Corp., Chicago, Illinois." An appropriate
notice shall be placed on such packages regarding the status of patents in the
United States of America and Canada. Appropriate steps shall be taken with
regard to the Licensed Product and Licensed Services to assure that the
trademarks and patents of VisCorp are protected.
e. RELATIONSHIP OF PARTIES. The parties to this Agreement are
independent contractors. Neither party is an agent, representative, or partner
of the other party. Neither party shall have any right, power, or authority to
enter into any agreement for or on behalf of or incur any obligation or
liability of or to otherwise bind the other party. This Agreement shall not be
interpreted or construed to create an association, joint venture, or partnership
between the parties or to impose any partnership obligation or liability upon
either party.
f. BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the respective successors and assigns of VisCorp and
Digital.
g. NOTICES. All notices to be given by either party to the
other party shall be in writing and shall be either personally delivered or sent
by certified mail, return receipt requested to:
Licensor: Visual Information Services Corp.
(VisCorp) 0000 Xxxxx Xxxxxxx Xxxxx,
Xxxxxxx, Xxxxxxxx 00000
Attn.: Xxxxxxx X. Xxxx, Chief Executive Officer
With Copy to: Xxxxxxx X. Xxxxxx, Esq.
Xxx, Xxxxxxx & Giarmarco
000 Xxxx Xxx Xxxxxx Xxxx, Xxxxx Xxxxx
Xxxx, Xxxxxxxx 00000-0000
Licensee: Digital Sciences, Inc.
(Digital) 0000 Xxxx Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attn.: Xxxxx X. Xxxxxxxx,
President and Chief Executive Officer
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With Copy to: ----------------------------------------
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Either party may change its address specified above by giving the other party
notice of such change in writing.
h. GOVERNING LAW. This Agreement shall be governed by and
shall be construed in accordance with the laws of the State of Michigan, United
States of America. Any claim for money arising out of this Agreement, which
cannot be settled by the parties, shall be settled by arbitration in accordance
with the rules of the American Arbitration Association then in effect and
judgment on the arbitration award may be entered by any court with jurisdiction.
The arbitration panel will not be permitted to modify any terms of this
Agreement or render a decision inconsistent with this Agreement.
i. ATTORNEY FEES. In the event of any legal action between
VisCorp and Digital on account of any alleged default by either party hereunder,
the prevailing party shall be entitled to be reimbursed for reasonable attorney
fees and costs incurred by the prevailing party.
j. BANKRUPTCY OF PARTY. In the event that either party shall
voluntarily file bankruptcy, or in the event that creditors of a party shall
petition for that party's bankruptcy:
(i) The other party shall be entitled to any
development and technical assistance provided from the other
party through the date of filing and
(ii) The license of the Technology, Licensed Product,
Licensed Services, Software, and Licensee Product shall be
binding upon the other party and its successors.
k. WAIVER. The failure of either party to insist upon or
enforce strict performance by the other party of any provision of this Agreement
or to exercise any right under this Agreement shall not be construed as a waiver
or relinquishment to any extent of such party's right to assert or rely upon any
such provision or right in that or any other instance.
l. RETURN OF INFORMATION. Upon the expiration or termination
of this Agreement, each party shall promptly return all information, documents,
manuals, and other materials belonging to the other party.
-13-
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
VISUAL INFORMATION SERVICES CORP. DIGITAL SCIENCES, INC.
BY: BY:
--------------------------------- ------------------------------
(Print Name) (Print Name)
--------------------------------- ------------------------------
(Title) (Title)
Date Date
----------------------------- --------------------------
-14-
EXHIBIT "A"
CONFIDENTIALITY AGREEMENT
THIS AGREEMENT made and entered into this ________ day of ________________,
19__, by and between _______________________, a ________________________________
______ corporation, its successors and assigns, hereinafter called the
"Company", and ______________________________, hereinafter called the
"Employee",
W I T N E S S E T H: That,
WHEREAS, Employee desires to enter into or continue in an employment
relationship with the Company, by virtue of which employment relationship the
Company will disclose to Employee information relating to the interactive
process of transmission of signals to and from television sets through a set top
converter box, "ED", and the "ED" operating system and enhancements,
modifications, and improvements to said process (together referred to herein as
the "Confidential Information"; and
WHEREAS, the Employee has agreed to maintain as confidential the
Confidential Information.
NOW, THEREFORE, the Company and Employee agree as follows:
1. Employee agrees that Employee will not disclose to any other person or
entity any of the Confidential Information without the prior written consent of
Company.
2. Employee agrees that Employee will not use for the benefit of the
Employee or any other person or entity any of the Confidential Information
without the prior written consent of Company.
3. The parties hereto, recognizing that irreparable injury will result to
the Company, its business and its property, in the event of a breach of the
above covenants, agree that in the event of a violation of any of the covenants
herein by Employee, that the Company shall be entitled, in addition to any other
remedies and damages available under law or equity, to the issuance of
restraining orders or injunctions, both temporary and permanent, in order to
restrict the violation of such covenants by Employee. In the event of a breach
of the above covenants, Employee shall pay all costs incurred by Company to
enforce such covenants, including, but not limited to, court costs and
attorney's fees incurred by Company. This Agreement shall run for the benefit
of Company and any party licensing Confidential Information to the Company.
--------------------------------------------
("Company")
By:
-----------------------------------------
--------------------------------------------
("Employee")
EXHIBIT "B"
CONFIDENTIALITY AGREEMENT
THIS AGREEMENT made and entered into this ____ day of ___________________,
19__, by and between ______________________________________, a
__________________ corporation, its successors and assigns, hereinafter called
the "Company", and ________________________________, hereinafter called the
"Representative",
WITNESSETH: That,
WHEREAS, Representative desires to enter into or continue in a relationship
with the Company, by virtue of which relationship the Company will disclose to
Representative information relating to the interactive process of transmission
of signals to and from television sets through a set top converter box, "ED",
and the "ED" operating system and enhancements, modifications, and improvements
to said process (together referred to herein as the "Confidential Information";
and
WHEREAS, the Representative has agreed to maintain as confidential the
Confidential Information.
NOW, THEREFORE, the Company and Representative agree as follows:
1. Representative agrees that Representative will not disclose to any
other person or entity any of the Confidential Information without the prior
written consent of Company except pursuant to administrative or judicial
subpoena for testimony or production of documents. Representative shall provide
written notice to Company if the Confidential Information is subpoenaed.
2. Representative agrees that Representative will not use for the benefit
of the Representative or by any other person or entity any of the Confidential
Information without the prior written consent of Company.
3. The parties hereto, recognizing that irreparable injury will result to
the Company, its business and its property, in the event of a breach of the
above covenants, agree that in the event of a violation of any of the covenants
herein by Representative, that the Company shall be entitled, in addition to any
other remedies and damages available under law or equity, to the issuance of
restraining orders or injunctions, both temporary and permanent, in order to
restrict the violation of such covenants by Representative. In the event of a
breach of the above covenants, Representative shall pay all costs incurred by
Company to enforce such covenants, including, but not limited to, court costs
and attorney's fees incurred by Company. This Agreement shall run for the
benefit of Company and any party licensing Confidential Information to the
Company.
--------------------------------------------
("Company")
By:
-----------------------------------------
--------------------------------------------
("Representative")
EXHIBIT C
PAYMENT TERMS FOR PURCHASE OF "ED" UNITS
Within the next thirty (30) days from the date of signing this Agreement,
the parties shall negotiate and mutually agree upon terms for the purchase of
"ED" units. The parties shall establish a minimum level of units to be
purchased, a price per unit and a discount schedule for purchases of units above
a certain level. The purchase price together with all applicable shipping
charges, packaging charges, other special charges and taxes, but less any
credits or deposits, shall be payable to VisCorp in full within ten (10) days
after acceptance and receipt of the invoice therefor.
If the parties agree to a pricing mechanism based upon a royalty rate being
charged by VisCorp to Digital based upon a percentage of Digital's gross
revenues in selling, marketing, leasing, distributing, and networking the
Technology and Licensed Product, then the parties shall mutually agree to a
royalty rate which shall not be less than ten percent of Digital's gross
revenues in selling, marketing, distributing, and networking the Technology and
Licensed Product less any allowable audited costs which must be approved by
VisCorp.
