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EXHIBIT 10.2
NONCOMPETITION AGREEMENT
This Noncompetition Agreement (this "Agreement") is entered into as of June 28,
1998 is made by and between Micrografx Inc., a Texas corporation having offices
at 0000 X. Xxxxxxx Xxxx, Xxxxxxxxxx, XX 00000 (along with its present and future
Affiliates, collectively, "Micrografx"), and Cendant Software Corporation, a
Delaware corporation, doing business through its subsidiary Sierra On-Line,
Inc., having offices at 0000 000xx Xxxxx XX, Xxxxx 000, Xxxxxxxx, XX 00000
(along with its present and future Affiliates, collectively, "Cendant"). Cendant
and Micrografx are sometimes referred to collectively herein as the "Parties"
and individually as a "Party".
RECITALS
A. Pursuant to that certain License Agreement (the "License Agreement") dated as
of June 28, 1998 between the Parties, Cendant is licensing certain technology
and associated intellectual property rights from Micrografx. B. Cendant is
unwilling to enter into the transaction unless Micrografx agrees not to compete
with Cendant as described herein.
AGREEMENT
NOW, THEREFORE, for and in consideration of the foregoing premises and other
good and valuable consideration, the sufficiency and receipt of which are hereby
acknowledged, and in order to induce Cendant to enter into the License
Agreement, the Parties hereby agree as follows:
1. DEFINITIONS
As used herein, the following terms shall have the meanings herein specified:
"AFFILIATE" means, with respect to any Person, a Person that, directly or
indirectly, through one or more intermediaries, controls, or is controlled by,
or is under common control with, such Person. For purposes of this definition,
the term "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
"BUSINESS ENTERPRISE PRODUCT" means any computer software product marketed to
business users.
"COMPETING PRODUCT" means any computer software product marketed (in all
formats, media and distribution channels) other than primarily as a Business
Enterprise Product which competes with any one or more of the following (whether
as a complete suite of products marketed and bundled together or as a
stand-alone component product competitive with one or more component product(s)
within the following described classes of products; for example, a stand-alone
product competitive with the "Instant 3D Print Studio" portion of the "Windows
Draw" product would be deemed a "Competing Product"; however, a computer
software product that is competitive with any product that is not currently, but
is after the Closing Date, included in a bundle with any of the following
products, but that is not competitive with the following products (or presently
existing components thereof) on a stand alone basis shall not be deemed a
"Competing Product")): (a) "Windows Draw 7.0" (with or without "Print Studio")
(or any Revision); (b) "Snapshot" version X.0 (or any Revision); (c) "Murder
Mystery 1.0" (or any Revision); (d) any Social Expression Product ; or (e) any
computer software product based on or similar to the "Crayola" product source
code licensed to Cendant hereunder (or any Revision). By way of example, and not
limitation, marketing primarily as other than a Business
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Enterprise Product is indicated by such factors as suggested end user price
point on initial product launch, packaging design, in-store product positioning
(to the extent controlled by the product developer/publisher), placement and
nature of advertising and Third Party industry product classification (e. g., PC
Data and other published software industry reports, surveys and reviews).
"CONFIDENTIAL INFORMATION" means: (i) Technical Information; (ii) business
information of a Party, including but not limited to any information relating to
a Party's product plans, product designs, product costs, product prices, product
names, finances, marketing plans, business opportunities, personnel, research,
development or know-how; and (iii) any information designated by any party as
"confidential" or "proprietary" or which, under the circumstances taken as a
whole, would reasonably be deemed to be confidential; and (iv) the terms and
conditions of this Agreement. "Confidential Information" does not include any
information that: (a) was in or entered the public domain through no wrongful
act of the receiving Party; (b) was rightfully received by the receiving Party
from a Third Party who is not bound by a restriction of nondisclosure; (c) was
already in the disclosing Party's possession without restriction as to
disclosure; or (d) was developed by the receiving Party independently and
without reference to any Confidential Information of the other Party as can be
shown by written records.
"DERIVATIVE WORK" means a work that is based upon one or more preexisting works,
such as a revision, modification, adaptation, translation, abridgment,
condensation, expansion, or any other form in which such preexisting works may
be recast, transformed or adapted and that if prepared without the authorization
of the owner of the preexisting work would constitute copyright infringement or
other infringement of the IPR of the owner therein.
"DEVELOP" (or such conjugation thereof as the context may require) means design,
engineer, prepare or develop (or such conjugation thereof as the context may
require).
"DISTRIBUTE" (or such conjugation thereof as the context may require) means
sell, license, transfer or otherwise directly or indirectly distribute (or such
conjugation thereof as the context may require).
"EXPLOIT" (or such conjugation thereof as the context may require) means to
Make, have Made, Develop, Distribute, Make Derivatives of, Use and otherwise
exploit commercially or noncommercially (and conjugations thereof as required by
the context).
"IPR" means any Copyright, Patent, Trademark, rights in and to Know-How, moral
right or other intellectual property or proprietary right of any kind, whether
arising under the laws of the United States or any other nation, state or
jurisdiction (including, but not limited to, any foreign equivalents thereto).
"MAKE" (or such conjugation thereof as the context may require) means
manufacture, assemble, produce, reproduce or make or have made (or such
conjugation thereof as the context may require).
"MICROGRAFX PROGRAMS" means, collectively, the following in source and object
code form: (a) the Technology underlying the "CreataCard" version 3 software
product (but specifically excluding all Content), the Technology underlying the
"Crayola" software product (but specifically excluding all Content),
"WindowsDraw 6.0", "WindowsDraw 7.0", "Photo Magic", "Instant 3D Print Studio",
"Snapshot" and "Murder Mystery" (working title) computer software products for
all platforms, media and languages and any and all other computer software
products planned for Development or in Development by Micrografx other than
Business Enterprise Products; (b) all end-user traffic information and data
generated from the "Personal Creativity" section of Micrografx's Web Site and
all end user registration and customer support information
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concerning the Windows Draw product line and CreataCard and other Micrografx
consumer card making product lines; (c) all computer software and associated IPR
used, included or embodied in any products of Micrografx to provide locking and
unlocking capabilities (e.g., user access codes, automatic shutdown features,
and similar devices); (d) computer software and associated IPR used in
connection with the creation, downloading and publishing of cards and other
materials on-line by end-users; (e) all e-commerce engine technology associated
with items (a) through (d) above ; (f) all development tools and processes used
in connection with the Development or Making of any of the foregoing (including
the "Rapid Development" tool); and (g) any Updates of any of the foregoing.
"MICROGRAFX PROPERTIES" means, collectively, the Micrografx Programs (including
all Content and Technology used, included or embodied in any of the Micrografx
Programs) and the Documentation. "Micrografx Properties" do not include any
Indicia.
"PERSON" means any individual, partnership, joint-stock company, firm,
corporation, association, unincorporated organization, joint venture, trust or
other entity.
"REVISION" means, with respect to a product, any revision, update, sequel,
modification, Derivative Work and/or other enhancement (whether or not based on
the Micrografx Properties and whether or not marketed with any of the Micrografx
Indicia).
"SOCIAL EXPRESSION PRODUCT" means a combination of art and verse designed to
convey sentiment regarding an array of human interaction and emotion, in both
printed and electronically delivered format, post cards, invitations,
announcements, awards and certificates.
"SUBLICENSE" means the sublicensing, grant or other authorization to a Third
Party to Exploit any or all of the rights granted under a license.
"TECHNOLOGY" means, with respect to any computer software product, all Source
Code, Object Code, HTML code and other codes, designs, formulas, algorithms,
methods, processes, procedures, ideas, concepts, inventions, discoveries,
technologies, tools, materials and devices used, included or incorporated
therein. "Technology" does not include any Indicia.
"TECHNICAL INFORMATION" includes all technical information, documentation,
binaries, libraries and source code, of the applicable Party.
"THIRD PARTY" means any Person that is not a Party or an Affiliate of a Party.
"USE" (or such conjugation thereof as the context may require) means display,
perform, copy, use or reduce to practice (or such conjugation thereof as the
context may require).
All other capitalized terms used herein shall have the meaning provided
for such term set forth in the License Agreement.
SECTION 2. NONCOMPETITION
For a period of five (5) years from the Closing Date, Micrografx shall not
(whether directly or indirectly (including for or through any Affiliate or Third
Party)), Develop, Make, or Distribute any Competing Products (except as required
in connection with the Distribution Transaction) Nothing herein contained shall
limit Micrografx from Exploiting any of the Micrografx Properties (including
without limitation, software development tools and component functionality) in
any manner so long as such Exploitation is not in or in connection with a
Competing Product. The Parties acknowledge and agree, by way of example, and not
by limitation, that presently: (a) products such as Print Artist, Printmaster
Office, Printmaster Publishing Suite, Printmaster, Corel Printhouse, Printshop
Publishing
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Suite are products that would be considered to be Competing Products with
respect to the "Windows Draw 7.0" product (with or without "Print Studio"); and
(b) products such as Adobe Photo Deluxe, Ulead iPhoto Express, Microsoft Picture
It, Broderbund Photo Organizer, are products that would be considered to be
Competing Products with any version of the "Snapshot" product, if such products
were Developed, Made or Distributed by Micrografx. Micrografx's "Picture
Publisher", as currently marketed and with its current type of business oriented
interfaces and functionality is not a "Competing Product." For purposes of
clarification, during the same five (5) year period, any transfer, license,
sublicense, assignment, sale or other transaction involving all or any part of
Micrografx's technology (whether present or future), whether voluntarily or by
operation of law (e.g., by merger, consolidation or reorganization), shall be
subject to and burdened by the noncompetition covenant set forth in this Section
4 and the license grants to Cendant set forth in this Agreement; provided,
however, any Third Party acquiring, licensing or otherwise obtaining rights to
such Micrografx technology whether voluntarily or by operation of law shall not
be subject to or otherwise burdened by the noncompetition covenant set forth in
this Section 4 and the license grants to Cendant set forth in this Agreement
with respect to such Third Party's preexisting, non-Micrografx technology or
Third Party independently developed technology that is not (i) a derivative of
or otherwise based on or using any Micrografx technology or (ii) developed by
persons who were Micrografx employees or independent contractors immediately
prior to such transaction.
3. REPRESENTATIONS AND WARRANTIES
Micrografx hereby represents and warrants to Cendant that (a) Micrografx has all
requisite power and authority and full legal right to execute and deliver, and
to perform all its obligations under, this Agreement and (b) this Agreement has
been duly executed and delivered by Micrografx and constitutes the legal, valid
and binding obligation of Micrografx, enforceable against Micrografx in
accordance with its terms.
4. SPECIFIC PERFORMANCE; DAMAGES
4.1 SPECIFIC PERFORMANCE
The parties acknowledge that it may be impossible to measure in money the
damages that Cendant shall incur on account of Micrografx's violation of any
provision of this Agreement. Consequently, in any action specifically to enforce
any provision of this Agreement, Micrografx hereby waives any claim or defense
therein that an adequate remedy at law or in damages exists. Micrografx further
agrees that Cendant shall be entitled to injunctive relief, specific performance
or other equitable relief to prevent violation of any provision of this
Agreement.
4.2 DAMAGES
Without limiting any other rights of Cendant, including, without limitation, the
rights described in Section 4.1 hereof, Micrografx shall be liable to Cendant
for all damages resulting from a breach by Micrografx of any provision of this
Agreement.
5. NO IMPLIED WAIVERS; RIGHTS CUMULATIVE
5.1 WAIVERS
No failure on the part of Cendant to exercise and no delay in exercising any
right, power, remedy or privilege under this Agreement or provided by statute or
at law, in equity or otherwise shall
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impair, prejudice or constitute a waiver of any such right, power, remedy or
privilege, nor shall any single or partial exercise of any such right, power,
remedy or privilege preclude any other or further exercise thereof or the
exercise of any other right, power, remedy or privilege. No failure on the part
of Cendant at any time to request further information or to require further
action of Micrografx shall constitute a waiver by such party of any right,
power, remedy or privilege of such party to request further information or
require further action.
5.2 RIGHTS AND REMEDIES
Nothing contained in this Agreement shall be construed to limit in any way any
right, power, remedy or privilege of Cendant under this Agreement now or
hereafter existing at law or in equity. Each and every right, power, remedy and
privilege hereby given to, or retained by, Cendant in this Agreement shall be in
addition to and not in limitation of every other right, power, remedy and
privilege given under this Agreement now or hereafter existing at law or in
equity and may be exercised from time to time or simultaneously and as often and
in such order as may be deemed expedient by Cendant. All such rights, powers,
remedies and privileges shall be cumulative and not mutually exclusive and the
exercise of one shall not be deemed a waiver of the right to exercise any other.
Micrografx hereby waives, to the extent permitted by applicable law, any right
which it may have to require Cendant to choose or elect remedies.
6. SURVIVAL
All agreements, covenants, representations, warranties and indemnities set forth
in this Agreement shall survive the execution and delivery of this Agreement.
Notwithstanding anything herein or in any other agreement to the contrary, all
agreements, covenants, representations, warranties and indemnities set forth in
this Agreement shall survive the expiration of the noncompete provision or other
termination of this Agreement.
7. FURTHER ASSURANCES
Micrografx agrees to duly execute and deliver (to Cendant or otherwise), or
cause to be duly executed and delivered (to Cendant or otherwise), such further
instruments and do and cause to be done such further acts and things that may be
necessary or as Cendant may at any time and from time to time reasonably request
in connection with its administration of this Agreement or to carry out more
effectively the provisions and purposes of, or to better assure and confirm unto
Cendant its rights and remedies under, this Agreement.
8. AMENDMENTS
No amendment, modification, waiver, termination or discharge of any provision of
this Agreement, nor consent to any departure by Cendant or Micrografx therefrom,
shall in any event be effective unless the same shall be in writing specifically
identifying this Agreement and the provision intended to be amended, modified,
waived, terminated or discharged and signed by Cendant and Micrografx, and each
such amendment, modification, waiver, termination or discharge shall be
effective only in the specific instance and for the specific purpose for which
given. No provision of this Agreement shall be varied, contradicted or explained
by any oral agreement, course of dealing or performance or any other matter not
set forth in an agreement in writing and signed by Cendant and Micrografx.
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9. GENERAL PROVISIONS
9.1 CONFIDENTIALITY.
Each Party will refrain from using the other Party's Confidential Information
except as contemplated in this Agreement and from disclosing such Confidential
Information to any Third Party except to employees (or subcontractors), legal
advisors, financial advisors and in the course of due diligence as is reasonably
required in connection with the exercise of its rights and obligations under
this Agreement (and only subject to binding use and disclosure restrictions at
least as protective as those set forth in this Agreement executed in writing by
such employees, subcontractors or other parties). The Parties will each store
and protect the other party's Confidential Information from unauthorized access
with due care. The foregoing obligations of confidentiality shall not apply to
any information which is required to be disclosed by applicable Law (but only to
the extent and for the purpose of such required disclosure); provided, that in
such event, the receiving Party shall promptly notify the disclosing Party and
cooperate as requested by the disclosing Party to minimize the scope of such
disclosure.
9.2 SEVERABILITY.
If any provision of this agreement is deemed unlawful, void, or for any reason
unenforceable, such provision shall be narrowed in scope or otherwise amended to
the extent necessary to make such provision lawful, valid and enforceable while
as nearly as possible reflecting the intent of the Parties as expressed in this
Agreement, or, if such amendment is impossible, severed from this Agreement and
if so severed, the Parties shall negotiate in good faith any amendment to this
Agreement necessary to reflect the original intent of the Parties. No amendment
or severing of any provision of this Agreement shall affect the validity or
enforceability of any remaining provisions.
9.3 NOTICES.
Unless otherwise provided, any notice required or permitted under this Agreement
will be given in writing and will be deemed effectively given upon personal
delivery to the Party to be notified, upon confirmed receipt of telecopy or
other electronic facsimile transmission, or upon deposit with the United States
Post Office, postage prepaid, registered or certified with return receipt
requested and addressed to the Party to be notified at the address indicated for
such Party below:
If to Cendant: Sierra On-Line, Inc.
0000 000xx Xxxxx XX, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: General Counsel
Fax: (000) 000-0000
With a copy to: Xxxxxxx Coie LLP
00 000xx Xxxxxx Xxxxxxxxx
Xxxxx 0000
Xxxxxxxx, XX 00000-0000
Attn: Xxxxx Xxxx, Esq.
Fax: (000) 000-0000
If to Micrografx: Micrografx, Inc.
0000 X. Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attn: General Counsel
Fax: (000) 000-0000
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With a copy to: Jenkens & Xxxxxxxxx
0000 Xxxx Xxx., Xxxxx 0000
Xxxxxx, XX 00000
Attn: Xxxxx Xxxxxx, Esq.
Fax: (000) 000-0000
Either Party may change its address specified in this Section by giving the
other Party notice of such change in accordance with this Section.
9.4 SUCCESSORS AND ASSIGNS.
This Agreement shall be binding on, enforceable by,
and inure to the benefit of, the successors and assigns of Micrografx and
Cendant.
9.5 COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original instrument, but all of which together shall
constitute only one and the same instrument.
9.6 GOVERNING LAW.
This Agreement will be interpreted, construed and enforced in accordance with
the laws of the State of New York.
9.7 ENTIRE AGREEMENT.
This Agreement sets forth the entire agreement, and supersedes any and all prior
agreements, between the Parties regarding the subject matter hereof. No
amendment of any provision of this Agreement shall be effective unless set forth
in a written instrument signed by both Parties.
9.8 AFFILIATES.
Each Party shall remain obligated for the actions or inaction of its Affiliates
to ensure that no such action or inaction results in a breach or default of any
term or condition of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered as of the date first above written.
Micrografx: Cendant:
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MICROGRAFX, INC. CENDANT SOFTWARE CORPORATION
By: /s/ Xxxxxxx Xxxxxxx By /s/ Xxxxx XxXxxx
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Its CEO Its CEO
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