SOFTWARE LICENSE AGREEMENT
EXHIBIT 10.4
THIS AGREEMENT is entered into this 21st day of November
2006 (the “Effective Date”) between ESPRE SOLUTIONS, INC. (“Licensor”)
with its principal place of business at 0000 X. Xxxxx Xxxxxxx,
Xxxxx 0000, Xxxxx, XX 00000 and Global IP Sound
Inc., a Delaware Corporation and its affiliates Global IP Sound Europe AB
and Global IP Sound Asia Pacific Limited with offices at 000 Xxxxxx
Xxxxxx, 0xx xxxxx, Xxx Xxxxxxxxx, XX 00000
( “ Licensee “ ), is for the software license of
Technology in accordance with the terms and conditions stated in this
Agreement and any attachments to this Agreement.
WHEREAS, Licensor has the right to license the intellectual property
and the Technology and,
WHEREAS, Licensor desires to license and have Licensee market and
distribute said Technology; and
NOW, THEREFORE, in consideration of the foregoing recitals and the
covenants set forth in this Agreement, the parties agree as follows:
| 1. | DEFINITIONS. |
The following definitions set forth below apply to this Agreement:
“Agreement” means this Software License Agreement
“Affiliate” of a party shall mean an entity directly or indirectly
controlling, controlled by or under common control with that party
where control means the ownership or control, directly or
indirectly, of more than fifty percent (50%) of all of the voting power of
the shares (or other securities or rights) entitled to vote for the
election of directors or other governing authority; provided that such
entity shall be considered an Affiliate only for the time during which
such control exists.
“Application” shall mean a computer program or group of computer
programs designed for end users.
“Derivative Work” shall mean a work created by Licensee and based on
or incorporating the Technology and/or the Documentation, including but
not limited to, translations, abridgements, condensations, improvements,
updates, enhancements, or any other form in which the Technology and/or
the Documentation may be recast, transformed, adapted, or revised, in each
case to the extent that the work would constitute an infringement or
Licensor’s rights if created without the license granted herein.
“Documentation” means the data sheet, specifications, test procedure
and methodology, and instructions for the Technology.
“Entity” shall mean any general partnership, limited partnership,
limited liability company, corporation, joint venture, trust, business
trust, cooperative or association, or any foreign trust or foreign
business organization.
“Equipment” shall mean data processing and similar equipment,
including options, accessories and attachments for more basic equipment.
Equipment includes, as a component thereof, any media fixed or embedded
therein that is not normally replaced except for maintenance and repair.
Equipment may include in its meaning, depending upon
context, a system or systems consisting of tangible Equipment and
intangible Software.
“Intellectual Property Right” and “Intellectual Property Rights”
shall mean all worldwide right, title and interest of a Person in, to and
under any and all: (a) United States or foreign patents and pending
patent applications therefore, including the right to file new
and additional patent applications based thereon, including
provisionals, divisionals, continuations, continuations-in-part,
reissues and reexaminations; (b) copyrights; and (c) trade secrets,
know-how, processes, methods, engineering data and technical information.
“Information” shall mean any idea, program, technical, business or
other intangible information, however conveyed.
“Know-How” shall mean experience, skills and expertise in
non-tangible form, relating to Technology and consulting and advisory
services relating to such experience, skills and expertise.
“License Fee” shall have the meaning set forth in Section 3.1.
“Licensor” means ESPRE Solutions Inc. and it’s subsidiaries.
“Licensor Intellectual Property Rights” shall mean one or more
Intellectual Property Rights owned by Licensor or licensed to Licensor by
a Third Party with the right to sublicense at no cost. Licensor is not
under an obligation to seek such Third Party licenses.
“Media” or “Medium” means any document, print, tape, disc, tool,
semiconductor chip or other tangible information-conveying article
“Market” means the Licensee’s video processing market encompassing
real-time, pre-recorded real-time, and interactive entertainment,
communications, and collaborations technologies.
Real-time communication: Voice and video that is being generated
during the course of an interaction with one or more persons without
delay; for example, peer to peer, multi-party voice and video interactive
over IP and PSTN.
Pre-recorded of a real time interaction: Voice and video that is
recorded at one time with the intent to be played at a later time; for
example, voice/video mail, playing back a portion of a conference or
recording and sending a voice and video message. This does not include
video from a production, distribution, or aggregation company, or
broadcast, satellite, or cable television programming.
Interactive entertainment: Voice and video that allows participants
to see and respond to each other. For example: video gaming, customer
support
Communication: Voice and video that allows for interpersonal
exchanges between two or more entities.
Collaboration: Video that allows for cooperative efforts between two
or more parties.
“Net Receipts” shall mean the gross amount recognized as income on
Licensee’s books (pursuant to generally accepted accounting principles
consistently applied) in connection with the sale of a Product, less
deductions for payment of sales, value added or any similar taxes, and
shipping and insurance charges, as well as less deductions for returned
products, with respect to such Product.
“Object Code” shall mean the machine-readable binary version of a
computer program that is used by the computer to run the program.
“Open Source Technology” shall mean any technology from the
open source
community, including without limitation, any software that requires, as a
condition of use, modification and/or distribution of such software, that
other software incorporated into, derived from or distributed with such
software be: (i) disclosed or distributed in source code form; (ii)
licensed for the purpose of making derivative works; or (iii)
redistributable at no charge.
“Product” shall mean any integrated work utilizing the Technology or
Derivative Work.
“Person or Party” shall mean any individual or Entity, and the heirs,
executors, administrators, legal representatives, successors and assigns
of the “Person or Party” when the context so permits.
“Software” shall mean intangible information constituting one or more
computer or apparatus programs and the informational content of such
programs, together with any documentation supplied in conjunction with
and supplementing such programs.
“Source Code” shall mean the human-readable form of a computer
program and all related system documentation, including all comments
and any procedural code such as job control language.
“Specifications” shall mean the specifications for the
Technology Software as set forth in Schedule A to this Agreement, or
if not so set forth, shall mean Licensor’s current published
specifications, user documentation and other information for the Software
as of the date of order and any additional specifications furnished by
Licensee.
“Technology” shall mean the Source Code and Object Code for the LSVX
CODEC which is a Video CODEC owned by Licensor and protected by USA Patent
numbers 7003168, 671 1299 and 6904175.
“Term” shall mean the term of this Agreement as provided in Article
22.
“Third party” shall mean, with respect to a party, any Person that is
not an Affiliate of such party.
“Use” shall mean operate, reproduce, distribute, transmit (by
electronic means or otherwise), make available, perform and display.
| 2. | SOFTWARE LICENSE GRANT. |
2.1 Grant of License. Subject to the terms of this Agreement,
Licensor hereby grants to Licensee under all Intellectual Property Rights
of Licensor, now owned or licensed, a nonexclusive, worldwide, perpetual,
non-royalty bearing, license to use, modify the Technology and
Documentation (including all updates and upgrades thereof delivered to
Licensee) to create Derivative works in Object Code and Source Code form,
and to distribute and sell the Technology to the market (as defined in
Section 1 Definitions) as a Derivative Work embedded in the Licensee’s
products. The grant of each license hereunder includes the right to
convey and sublicense to any customer of Licensee, with respect to any
Product or Derivative Work thereof which is sold or licensed by Licensee
to such customer, rights to use and resell such Product or Derivative Work
as sold or licensed by Licensee to such customer (whether or not as part
of a larger combination) or through multiple tiers of distribution to end
user customers or directly to end user customers.
2.2 Exclusivity to Named Accounts: Licensor hereby grants the license
to the technology as an exclusive arrangement to named accounts in that
the Licensor will not provide the Technology expressly defined in
the Section 1 “Definitions” to i) SPIRIT
DSP ii) Counterpath Solutions, Inc., formerly Xten Networks, Inc.,
iii) eyeP Media; and iv) Eyeball Networks Inc.
2.3 Enhancements. Revisions and Modifications to the Technology.
2.3.1 Licensor agrees to make customized changes to the Technology
for Licensee’s exclusive use at the direction of the Licensee as set forth
in Section 4.3.
2.3.2 Licensee is authorized to make enhancements, revisions and
modifications to the Technology.
2.3.3 Any customized enhancements, revisions and modifications
integrated by the Licensor for the Technology paid for by Licensee or
made by or for Licensee, shall be owned by the Licensee. .
2.4 Restriction on Assignment . The license to the Technology granted
hereby may not be transferred, sold or sublicensed by Licensee except to
an Affiliate. The preceding notwithstanding Licensee may transfer or
assign the license to the Technology to a successor in interest acquiring
substantially all of the stock or assets of Licensee or in the event of a
sale of the business unit utilizing the Technology.
2.5 No Other Licenses. The License granted under this Agreement is
specifically set forth herein, and Licensor grants no licenses to Licensee
by implication or estoppel.
2.6 Reservation of Rights. Licensor reserves all rights to the
Technology not specifically granted to Licensee hereunder.
2.7 Restrictions on Export. Licensee acknowledges and agrees that it
shall not import, export, or re-export the Products or related
Documentation to any country in violation of the laws and regulations of
any applicable jurisdiction. Licensee further agrees to defend, indemnify,
and hold Licensor harmless for any losses, costs, claims, or other
liabilities arising out of Licensee’s breach of this Section.
2.8 Delivery.
2.8.1 Upon the execution of this Agreement and receipt of the
initial License Fee payment referenced in Subsection 3.3.1, Licensor
will deliver, i a CODEC library usable in a Windows environment, ii a
CODEC DLL usable in the Windows and Windows Mobile environments and
iii an API specification. Licensor will ship the Technology to Licensee in
CD-ROM format or provide other acceptable transference via FTP.
2.8.2 Upon payment of the License Fee in full Licensor will deliver
to Licensee the complete Technology Source Code and full Documentation.
2.8.3 If Licensee elects to take delivery of the Technology Source
Code prior to 2 January 2008 (except as set forth in Subsection 2.8.4),
Licensee shall pay fifty percent (50%) of the remaining amount of the
License Fee then due and upon receipt of such payment Licensor will
deliver the complete Technology Source Code and Documentation. Licensee
shall pay the then remaining unpaid fifty percent (50%) of the License Fee
within ninety (90) days.
2.8.4 Within thirty (30) days of the execution of the Agreement
Licensor will place the complete Technology Source Code in a mutually
agreeable escrow. If prior to the payment of the full amount of the
License Fee Licensor is unable or unwilling to meet Licensee’s
requirements for the support of the Technology including the development
of
new features and functions to meet Licensee’s roadmap, on ten (10)
days prior notice Licensor will deliver the complete Technology
Source Code and Documentation to Licensee. In such event the payment
schedule in Subsection 3.3.3 shall apply.
| 3. | COMPENSATION |
3.1 Licensee Fees. In consideration of the license granted by the
Licensor of the Licensed Software by the Licensor under Section 2 above,
the Licensee shall pay the Licensor a one time Software license fee of Two
Million U.S. Dollars (US$2,000,000.00) (the “License Fee”).
3.2 Taxes and Assessments.
3.2.1 In addition to any other payments due under this Agreement,
Licensee agrees to pay, any sales, use, excise, import or export,
value-added or similar tax or duty, and any other tax not based upon
Licensor’s net income, including any penalties and interest, and all
government permit or license fees and all customs and similar fees, levied
upon the use or distribution of the Products which Licensor may incur in
respect of this Agreement, and any costs associated with the collection of
any of the foregoing items (“Taxes”).
3.2.2 If Licensee fails to pay any Taxes as of the original due date
for such Taxes and Licensor receives any assessment or other notice
(collectively the “Assessment”) from any governmental taxing authority
providing that such Taxes are due from Licensor, Licensor shall give
Licensee written notice of the Assessment and Licensee shall pay to
Licensor or the taxing authority the amount set forth as due in the
Assessment within thirty (30) days of receipt of such written notice from
Licensor.
3.3 License Fee Payment Terms.
3.3.1 The Licensee agrees to pay by wire transfer an initial amount
of Three Hundred Fifty Thousand US Dollars (US$350,000) on the Effective
Date.
3.3.2 Licensee agrees to pay by wire transfer Six Hundred Fifty
Thousand US Dollars (US$650,000) on 3 January 2007.
3.3.3 Licensee agrees to pay by wire transfer Two Hundred Fifty
Thousand US Dollars (US$250,000) on each of 1 April 2007, 1 July 2007, 1
October 2007 and 2 January 2008, Provided however, in the event Licensee
elects to take delivery of the Technology Source Code prior to 2 January
2008 pursuant to the terms of Section 2.8.3 the payment terms in
Subsection 2.8.3 shall apply.
3.4 Licensor agrees that fifty (50) percent of each payment made by
Licensee shall be
allocated first to the payment of any amounts owed by Licensor to Video
Software Partners LLC until all indebtedness payable to such third party
is paid in full.
| 4. | MAINTENANCE AND SUPPORT; SERVICES OF DEDICATED ENGINEER |
4.1 Dedicated Engineer Licensor agrees to make available to Licensee
the full time services of a qualified engineer acceptable to Licensee
trained in the use of the Technology (“Dedicated Engineer”) commencing the
Effective Date for an annual fee of One Hundred Fifty Thousand US Dollars
(US$150,000) payable in monthly installments of Twelve Thousand Five
Hundred US Dollars (US$12,500) each. Such engineer shall provide full time
support to Licensee for the use and integration of the Technology and to
make enhancements, revisions and modifications to the Technology as
required by Licensee for the exclusive use of Licensee (collectively
“Dedicated Support Service”). Licensee shall be authorized to hire such
Dedicated Engineer as a full time employee of Licensee any time after the
first six (6) months during the initial one (1) year period of engagement.
Such enhancements, revisions and modifications made by the Dedicated
Engineer shall be works “made for hire” and shall be owned exclusively by
Licensee. Such Dedicated Support
Services will be provided on a continuous basis following the Effective
Date until Licensee provides Licensor with thirty (30) days written notice
of termination.
4.2 Annual Support and Maintenance Licensor will provide annual
support and maintenance to Licensee including updates and upgrades
provided to its customer base generally for an annual fee of Twenty Five
Thousand US Dollars (US$25,000) substantially on the terms and conditions
set forth in Schedule B (“Annual Support and Maintenance”) provided
however, such Annual Support and Maintenance fees shall be waived so
long as Licensee is receiving Dedicated Support Services. Such Annual
Support and Maintenance shall be provided on a continuous basis following
the Effective Date until Licensee provides at least thirty (30) days
written notice of termination.
4.3 Customer Engineering Services. After the termination of
the services of the Dedicated Engineer, Licensor on request by Licensee
will provide custom engineering services at a rate of Seven Hundred Fifty
US Dollars (US$750) per day or other mutually agreed rate based on
mutually agreed statements of work specifying the services required and
estimated the number of engineering days required to complete said work.
Such deliverables will be considered “work made for hire” and shall be
owned exclusively by Licensee.
| 5. | MARKETING AND PUBLICITY |
5.1 Marketing. Except as provided in Section 5.2 below, the parties
agree to work together to identify areas where joint marketing efforts
would benefit both parties, and upon mutual agreement shall implement
such efforts including mutually approved press releases to announce
the formation of the business relationship established by this Agreement.
5.2 Publicity. Neither party shall disclose the terms of this
Agreement to any third party, other than its financial or legal advisors
and current or potential Non-Corporate Investors, or make any
announcements regarding the nature of the relationship between the parties
without the prior approval of the other party, except that a party may
disclose the terms of this Agreement where required by law, provided that
such party uses reasonable effort to obtain confidential treatment or
similar protection to the fullest extent available to avoid public
disclosure of the terms of this Agreement. A party required by law to make
disclosure of the terms of this Agreement will promptly notify the other
party and permit the other party to review and participate in the
application process seeking confidential treatment. “Non-Corporate
Investors” shall mean venture capital investors/funds and investment
banking investors/funds.
5.3 Branding. Licensee and its Affiliates may but shall not be
required to use the Licensor trademarks in conjunction with the
distribution of the Products and in their advertising, promotional and
printed materials for the Products and on the Products.
| 6. | PROPRIETARY RIGHTS; NON-SOLICITATION |
6.1 Title. Licensee acknowledges that the Technology represents the
valuable trade secrets of Licensor. Licensor shall be the sole and
exclusive owner of the Technology. Subject always to Licensor’s ownership
of the Technology, Licensee shall be the sole and exclusive owner of the
Products. Applications for the Products shall belong solely and
exclusively to the party developing or paying for the development of such
applications.
6.2 Proprietary Rights Notices. Licensee agrees that it will not
remove, alter or otherwise obscure any proprietary rights notices
appearing in the Technology.
6.3 U.S. Government Restricted Legend. All Licensor technical data
and computer software is commercial in nature and developed solely at
private expense. Software is delivered as Commercial Computer Software as
defined in DFARS 252.227-7014 (June 1995) or as a commercial item as
defined in FAR 2.101(a) and as such is provided with only such
rights as are provided in Licensor’s standard commercial license for
such software. Technical data is provided with limited rights only as
provided in DFARS 252.227-7015 (Nov. 1995) or FAR 52.227-14 (June 1987),
whichever is
applicable.
6.4 End-User Licensing. Licensee agrees that each copy of any
Technology Software distributed by Licensee hereunder will be with a
software license at least as protective of the Technology Software as: (i)
the terms and conditions Licensee uses for its own software products; and
(ii) the terms and conditions governing this Agreement.
6.5 Source Code Escrow. Licensor agrees that Licensee shall be
permitted to place the Source Code of the Derivative Works in escrow
included with Licensee’s software products from time to time as required
by Licensee customers subject to the same escrow license terms and
conditions applicable to Licensee’s software distributed to such
customers.
6.6 Non-solicitation. Licensee agrees that during the Term of this
Agreement Licensee will not directly or indirectly, either for itself or
any other person or entity, solicit any individual who is engaged as an
employee, agent or independent contractor, by Licensor or Licensor’s
subsidiary (excluding the Dedicated Engineer) to terminate his or
her employment or engagement with Licensor or such subsidiary
and/or to become an employee, agent or independent contractor of Licensee
or such other person or entity. During the term of this Agreement, and for
a period of one (1) year thereafter, Licensee agrees that it will not take
any action either on behalf of itself or any other person or entity which
action is designed to disrupt Licensor’s business relationships with
Licensor’s strategic partners or to directly solicit, or allow any of its
subsidiaries or affiliates to solicit, any of Licensor’s strategic
partners for the purpose of persuading them to cease doing business with
Licensor.
| 7. | REPRESENTATIONS AND WARRANTIES |
7.1 Licensor and Licensee each represents and warrants to the other
that:
(i) it is organized, validly existing and in good standing under
the laws of the country or state in which it is incorporated;
(ii) its execution and delivery of this Agreement, and the
performance of its obligations under this Agreement, have been duly
authorized by all necessary corporate action on its part, and it has full
corporate power, right and authority to enter into this Agreement, to
grant the license it has granted hereunder and to perform its obligations
hereunder;
(iii) neither the execution and delivery of this Agreement by it, nor
the performance by it of any of its obligations under this Agreement,
violates any applicable law or regulation of any country, state or other
governmental unit, or its Articles or Certificates of Incorporation or
Bylaws or other charter documents, or constitutes a violation of, or a
breach or default under, any agreement or instrument, or judgment or order
of any court or governmental authority, to which it is a party or to which
it is subject or to which any of the Technology is subject;
(iv) this Agreement is a valid and binding obligation of it,
enforceable against it in accordance with its terms, except as such
enforceability may be limited by equitable principles or by bankruptcy or
other laws affecting creditors’ rights generally;
(v) no consent, approval, order or authorization of any person,
entity, court or governmental authority is required on its part in
connection with the execution and delivery of this Agreement or the
performance by it of its obligations hereunder;
7.2 Licensor represents and warrants to Licensee that it has title
to, or a license with the right to sublicense, the Technology, in the form
in which it is delivered to Licensee.
7.3 The Technology contains no malicious code or computer
viruses. Licensor shall immediately notify Licensee if any such problem
is suspected.
7.4 Licensor represents and warrants to Licensee that for a period of
ninety (90) days following Acceptance the Technology will perform
substantially in accordance with the Specifications and the
Documentation.
7.5 Licensor represents and warrants to Licensee that to the best of
Licensor’s knowledge the Technology does not and will not infringe,
misappropriate or otherwise violate the Intellectual Property Rights of
any Third Party.
7.6 Licensor represents and warrants that the Technology does not
contain any Open Source Software.
| 8. | INDEMNIFICATION |
8.1 The Licensee shall indemnify and save harmless Licensor and its
directors, officers and employees from and against any and all
liabilities, damages, costs or expenses awarded against or incurred or
suffered by Licensor arising out of any action or proceeding commenced or
maintained by any third party in violation of this Agreement or by law.
8.2 Licensor will defend, indemnify and hold the Licensee, its
officers, Affiliates, agents, employees and authorized contractors
harmless from and against any claims of Third Parties and all related
losses, damages, liabilities, costs and expenses (including court costs
and reasonable attorneys fees) arising from: (i) that the Technology
infringes, misappropriates or otherwise violates the Intellectual Property
Rights of any Third Party; (ii) Licensor’s failure to comply with
applicable laws or regulations or breach of this Agreement; or (iii)
death, injury, or damage to real or tangible personal property arising
from Licensor ‘s negligence or willful misconduct. Licensor’s obligations
of this paragraph do not extend to any claims to the extent they are the
subject of the Licensee’s indemnification obligations set forth in this
Agreement, or due to the Licensee’s negligence or willful misconduct, and
are conditioned on Licensor’s receipt of prompt written notice of any such
claim.
8.3 Remedies. In the event Licensor reasonably believes that the use
or distribution of the Technology becomes or is likely to become the
subject of a claim under Subsection 8.2 or enjoined, Licensor may, at its
option, either: (i) substitute functionally equivalent non-infringing
Technology, as the case may be; (ii) modify the Technology so that it no
longer infringes but remains functionally equivalent; (iii) obtain for
Licensee, at Licensor’s expense, the right to continue use the Technology;
or (iv) if none of the foregoing is feasible, Licensor may take back the
Technology and terminate the license for the Technology, and refund the
fees paid under this Agreement. EXCEPT FOR BREACH OF SECTION 7.5, SECTIONS
8.1 and 8.2 STATE LICENSEE’S SOLE AND EXCLUSIVE REMEDY WITH RESPECT TO
CLAIMS OF INFRINGEMENT OF PROPRIETARY RIGHTS OF ANY KIND, AND EXCEPT AS
STATED IN THIS AGREEMENT ALL WARRANTIES OF NON-INFRINGEMENT, EXPRESS OR
IMPLIED, ARE SPECIFICALLY DISCLAIMED AND EXCLUDED.
8.3 Procedure for Indemnification.
8.3.1 In the event that any legal proceedings are instituted, or any
claim or demand is asserted, by any third party which may give rise to any
damage, liability, loss, or cost or expense in respect of which either
party has indemnified the other party under this Section 8 above, the
indemnified party shall give the indemnifying party written notice of
the institution of such proceeding, or the assertion of such claim or
demand, promptly after the indemnified party first becomes aware thereof;
provided, however, that any failure by the indemnified party to give such
notice on such prompt basis shall not affect any of its rights to
indemnification hereunder unless such failure materially and adversely
affects the ability of the indemnifying party to defend such proceeding.
8.3.2 The indemnifying party shall have the right, at its option and
at its own expense, to be represented by counsel of its choice, subject to
the approval of the indemnified party, which approval shall not be
unreasonably withheld or delayed, and to
defend against, negotiate with respect to, settle or otherwise deal with
such proceeding, claim or demand; provided, however, that no settlement of
such proceeding, claim or demand shall be made without the prior written
consent of the indemnified party, which consent shall not be unreasonably
withheld or delayed, unless, pursuant to the terms and conditions of such
settlement, the indemnified party shall be released from any liability or
other exposure with respect to such proceeding, claim or demand; and
provided, further, that the indemnified party may participate in any such
proceeding with counsel of its choice and at its own expense. In the
event, or to the extent, the indemnifying party elects not to, or fails
to, defend such proceeding, claim or demand and the indemnified party
defends against, settles or otherwise deals with any such proceeding,
claim or demand, any settlement thereof may be made without the consent
of the indemnifying party if it is given written notice of the material
terms and conditions of such settlement at least ten (10) business days
prior to a binding agreement with respect to such settlement being
reached. Each of the parties agrees to cooperate fully with each other in
connection with the defense, negotiation or settlement of any such
proceeding, claim or demand.
| 9. | INTELLECTUAL PROPERTY RIGHTS. |
Title to the Technology and to intellectual property rights therein
shall remain in Licensor. Title to the Derivative Works (excluding the
pre-existing Technology) made by or for Licensee shall be vested in
Licensee.
| 10. | EFFECTIVE DATE AND DURATION. |
This Agreement shall become effective upon the date of execution (the
“Effective Date”) by the parties. The term of the license of Technology
shall be effective from the date of receipt of the Technology by Licensee
and shall remain in effect until Licensee discontinues use of the
Technology.
| 11. | NOTICES. |
Notices shall be given in writing by confirmed facsimile,
certified mail or registered mail addressed to the parties as shown on
the first page of this Agreement.
| 12. | ASSIGNMENT. |
Neither party may assign this Agreement, nor any rights or interests
granted or received under this Agreement without the prior written consent
of the other party, which shall not be unreasonably withheld.
The preceding notwithstanding either party may assign this Agreement,
or any rights or interests granted or received under this Agreement to a
successor in interest by merger or acquisition of substantially all of the
stock or assets of the assigning party or the sale of the business unit
utilizing the Technology received pursuant to this Agreement.
| 13. | OUTSOURCING. |
In the event that Licensee elects to have the functions for which it
uses the Technology performed by a third party (referred to as the
“Outsourcer”), Licensee shall have the right to assign its rights
hereunder to such Outsourcer for the limited and specific purpose of
enabling the Third Party to provide services to Licensee using the
Technology. . Licensee will require that such third party agrees to use
the Technology only for such purpose and to otherwise be bound by the
provisions of this Agreement.
| 14. | COMPLIANCE WITH LAWS. |
Both parties shall comply at their own expense with all applicable
laws, ordinances, regulations and codes in performance of this Agreement
| 15. | CHOICE OF LAW. |
The laws of the State of Texas shall govern this Agreement and all
transactions under it.
| 16. | MEDIATION. |
If a dispute relates to this Agreement and the parties have not been
successful in resolving such dispute through negotiation, the parties
agree to attempt for a period of forty five (45) days to resolve the
dispute through mediation by submitting the dispute to a sole mediator
selected by the parties or, at any time at the option of a party, to
mediation by the American Arbitration Association (“AAA”). Each party
shall bear its own expenses and an equal share of the expenses of the
mediator and the fees of the AAA. All defenses based on passage of time
shall be suspended pending the termination of the mediation. Nothing in
this clause shall be construed to preclude any party from seeking
injunctive relief in order to protect its rights pending mediation.
| 17. | LIMITATION OF LIABILITY. |
NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY EXCEPT FOR
MATERIAL BREACH OF CONFIDENTIALITY OR THE EXPRESS WARRANTY OF NON
INFRINGEMENT, NEITHER PARTY SHALL BE LIABLE FOR ANY INDIRECT,
INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES, OR DAMAGES RESULTING FROM
LOST DATA OR LOST PROFITS, OR COSTS OF PROCURING SUBSTITUTE TECHNOLOGY
HOWEVER ARISING, EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES. EXCEPT FOR THE EXCLUSIONS IN THE PRECEDING SENTENCE NEITHER
PARTY’S LIABILITY FOR DIRECT DAMAGES ARISING OUT OF, RELATING TO
OR IN ANY WAY CONNECTED WITH THE RELATIONSHIP OF THE PARTIES, THIS
AGREEMENT, ITS NEGOTIATION OR TERMINATION, OR THE PROVISION OR
NON-PROVISION OF THE TECHNOLOGY (WHETHER IN CONTRACT, TORT, OR
OTHERWISE) SHALL IN NO EVENT EXCEED THE AMOUNT PAID BY THE
LICENSEE TO LICENSOR UNDER THIS AGREEMENT . THE PARTIES AGREE TO
THE ALLOCATION OF LIABILITY SET FORTH IN THIS SECTION ENTITLED
“LIMITATION OF LIABILITY “.
| 18. | FORCE MAJEURE. |
Neither party shall be held responsible for any delay or failure in
performance of any part of this Agreement to the extent such delay or
failure is caused by fire, flood, strike, civil, governmental or military
authority, act of God, or other similar causes beyond its control and
without the fault or negligence of the delayed or non-performing party or
its subcontractors.
| 19. | WAIVER. |
The failure of either party at any time to enforce any right or remedy
available to it under this Agreement or otherwise with respect to any
breach or failure by the other party shall not be construed to be a waiver
of that right or remedy with respect to any other breach or failure by the
other party.
| 20. | SEVERABILITY. |
If any of the provisions of this Agreement shall be invalid or
unenforceable, the invalidity or unenforceability shall not invalidate or
render unenforceable the entire Agreement, but rather the entire Agreement
shall be construed as if not containing the particular invalid or
unenforceable provision or provisions, and the rights and obligations of
the parties shall be construed and enforced accordingly.
| 21. | SURVIVAL OF OBLIGATIONS. |
The obligations of the parties under this Agreement, which by their
nature would continue beyond the termination, cancellation or expiration
of this Agreement, shall survive termination, cancellation or expiration
of this Agreement.
| 22. | TERM AND TERMINATION. |
22.1 Term. The Term of this Agreement shall begin on the Effective
Date and shall continue in perpetuity unless and until terminated pursuant
to this Section 22.
22.2 Termination Due to Bankruptcy. In the event a party prior to the
payment of the Two Million U.S. Dollars (US$2,000.000) license fee: (i)
becomes insolvent; (ii) voluntarily files or has filed against it a
petition under applicable bankruptcy or insolvency laws which such party
fails to have released within thirty (30) days after filing; (iii)
proposes any dissolution, composition or financial reorganization with
creditors or if a receiver, trustee, custodian or similar agent is
appointed or takes possession with respect to all or substantially all
property or business of such party; or (iv) such party makes a general
assignment for the benefit of creditors, the other party may
terminate this Agreement by giving a termination notice, which
termination shall become effective ten (10) days after mailing.
22.3 Right to Terminate; Early Termination.
22.3.1 Prior to the payment of the Two Million U .S . Dollars
(US$2,000,000) license fee either party shall have the right to terminate
this Agreement if the other party is in material breach of any term or
condition of this Agreement and fails to remedy such breach within thirty
(30) days after receipt of a written notice of such breach given by the
non-breaching party; or
22.3.2 Licensee may terminate this Agreement upon thirty (30) days
written notice to Licensor:
(i) if remedies provided in Section 8.1 are insufficient to provide
Licensee with the right to continue using any part of the Technology
subject to a Claim of patent infringement or alleged patent infringement,
provided that Licensee shall not have the right to terminate if to the
extent that Licensor is able to avoid infringement or alleged infringement
of the patent rights of a Third party by having Licensee use another
version of a part of the Technology at Licensor’s expense; and
(ii) provided further that Licensee’s right to terminate
pursuant to the
foregoing subsections (a) and/or (b) shall not limit Licensor’s
rights and remedies otherwise available in this Agreement or at law.
22.4 Effect of Termination. In the event of any termination of this
Agreement, each party shall be entitled to the rights and remedies
afforded pursuant to Section 365(n) of the Bankruptcy Code, and to any and
all other legal and equitable remedies to which such party may be entitled
under the law. Upon the termination of this Agreement, Licensee shall
terminate further use and distribution of the Technology and, return or
destroy all copies of the Technology.
| 23. | SIGNATURE. |
The parties shall be entitled to rely upon and enforce a facsimile of
any authorized signatures as if it were the original.
| 24. | ENTIRE AGREEMENT. |
The provisions of this Agreement including all schedules and
statements of work and orders issued under this Agreement supersede all
prior and current oral and written communications, agreements, and
understandings of the parties with respect to the subject matter of this
Agreement and shall constitute the entire agreement between the parties.
The Agreement shall not be modified or rescinded, except by a writing
signed by both parties. Provisions on the reverse side of Licensee’s
orders and all provisions on Licensor’s forms shall be deemed deleted.
Estimates or forecasts furnished by Licensee shall not constitute
commitments.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly empowered representatives.
| AGREED TO BY: ESPRE SOLUTIONS, Inc. |
||||
| /s/ Xxxx Xxxxxx | ||||
| President and CEO | ||||
| Global IP Sound, Inc. |
||||||
| /s/ | ||||||
