EXHIBIT 10.14
VOXELGEO(R) LICENSE AGREEMENT
THIS LICENSE AGREEMENT, made and entered into this 25th day of August,
1995, by and between VITAL IMAGES, INC., an Iowa corporation with its principal
office located at 000 Xxxxx 0xx Xxxxxx, Xxxxxxxxx, Xxxx 00000 (hereinafter
referred to as the "Licensor"), and COGNISEIS DEVELOPMENT, INC., a Delaware
corporation with its principal office located at 0000 Xxxxxxxxxx, Xxxxxxx, Xxxxx
00000-0000 (hereinafter referred to as the "Licensee").
BACKGROUND
FIRST. Licensor has developed and owns all right, title and interest in and
to certain 3D volume interpretation software commonly referred to as the
VoxelGeo(R) software (hereinafter more fully described and defined as the
"Software").
SECOND. Licensor is the owner of the VoxelGeo(R) trademark and the
corresponding federal trademark registration (hereinafter more fully described
and defined as the "Licensed Trademark").
THIRD. Subject to the terms and upon conditions herein contained, Licensee
desires to obtain the exclusive right to use the Software and the Licensed
Trademark in the Licensed Field of Use (as that term is hereinafter defined),
and Licensor desires to grant such right to Licensee.
FOURTH. Licensor has entered into certain license agreements, maintenance
contracts and CDDI Agreements (as that term is hereinafter defined) relating to
the use, maintenance and development of the Software in connection with the
Licensed Field of Use and Licensee desires to obtain all of Licensor's rights
and assume all of Licensor's obligations under such contracts, and Licensor
desires to assign such rights to Licensee, all subject to the terms and
conditions herein contained.
NOW, THEREFORE, in consideration of the foregoing recitals and further in
consideration of the mutual covenants, conditions and agreements contained in
this Agreement and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Agreement
hereby agree and undertake as follows:
ARTICLE I
DEFINITIONS
1. DEFINITIONS. As used herein, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and
plural forms of the terms defined):
a. Acceptance Period. "Acceptance Period" shall have the meaning set
forth in Article III, Section 3 hereof.
b. Agreement. "Agreement" shall mean this License Agreement (together
with all exhibits, schedules, attachments and addenda) as the same may
be amended, modified or supplemented from time to time.
c. CDDI. "CDDI" shall have the meaning set forth in Article VIII,
Section 3.a.
d. CDDI Agreements. "CDDI Agreements" shall have the meaning set forth
in Article VIII, Section 3.a. hereof.
e. Deliverables. "Deliverables" shall have the meaning set forth in
Article III, Section 1 hereof.
f. Derivative Software Products. "Derivative Software Products" shall
mean any and all software products subsequently developed by Licensee
that incorporate the Source Code or any portion thereof other than the
following existing software products currently offered by Licensee
(even if such software products subsequently incorporate the Source
Code or source code from software derived from the Source Code as an
upgrade): the 2D and 3D versions of each of the following
applications: Focus; Disco; GeoSec; GeoStrat; and well log
interpretation software products based upon DLPS.
g. Effective Date. "Effective Date" shall mean the date first written
above.
h. Existing Licenses. "Existing Licenses" shall have the meaning set
forth in Article VIII, Section 2.a. hereof.
i. Existing Maintenance Contracts. "Existing Maintenance Contracts"
shall have the meaning set forth in Article VIII, Section 2.a. hereof.
j. Functional Specifications. "Functional Specifications" shall have
the meaning set forth in Article IX, Section 1.e. hereof.
k. Initial License Period. "Initial License Period" shall mean the time
period ending on the earlier of (i) January 1, 2001; or (ii) such time
as the aggregate royalties actually paid by Licensee to Licensor
(exclusive of the up-front license fee payable by Licensee pursuant to
Section 1 of Article IV) equals Two Million and no/100 Dollars
($2,000,000.00).
l. Licensed Field of Use. "Licensed Field of Use" shall mean use of the
Software and the Licensed Trademark in connection with visualizing and
interpreting seismic and other subsurface (earth and water)
information.
m. Licensed Trademark. "Licensed Trademark" shall mean the VoxelGeo(R)
trademark and corresponding U.S. Registration No. 1,793,534 covering
the VoxelGeo(R) trademark.
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n. Maintenance Services. "Maintenance Services" shall have the meaning
set forth in Article VII, Section 2 hereof.
o. Marketing Agreement. "Marketing Agreement" shall have the meaning
set forth in Article VIII, Section 1 hereof.
p. Net Receipts. "Net Receipts" shall mean all gross revenues received
by Licensee in connection with the licensing, sale, use or other
exploitation of the Software and/or Derivative Software Products less
(i) all normal trade discounts actually allowed by Licensee; (ii) all
sales, use and similar taxes included in such gross revenues; (iii)
all freight charges, agent's fees and other third party charges
included in such gross revenues; and (iv) royalties on such gross
revenues actually paid by Licensee to a third party.
q. Software. "Software" shall mean the 3D volume interpretation
software commonly referred to as the VoxelGeo(R) software that is
owned by Licensor and all documentation related thereto, including,
without limitation, the object code for such software and the Source
Code, all as they exist as of the Effective Date.
r. Source Code. Source Code shall mean the high level code that forms
the source program for the Software, which, when completed, becomes
the machine language object program for the Software.
s. Warranty Period. "Warranty Period" shall have the meaning set forth
in Article IX, Section 1.e. hereof.
2. RELATED DOCUMENTS. All of the terms defined in this Agreement shall have
the defined meanings when used in any exhibit, schedule, attachment or
addendum hereto or in any document made or otherwise delivered pursuant to
this Agreement, unless the context otherwise requires.
ARTICLE II
GRANT OF LICENSE
1. LICENSE. Upon the terms and conditions set forth herein, Licensor hereby
grants to Licensee, and Licensee hereby accepts, a worldwide, perpetual,
exclusive license to use the Licensed Trademark in connection with the
Software in the Licensed Field of Use and to use, modify and sublicense the
Software in the Licensed Field of Use.
2. SUBLICENSES.
a. Licensee shall not grant any sublicenses with respect to the Licensed
Trademark, the Software and/or Derivative Software Products except
upon terms and conditions that are consistent with the licenses
granted to Licensee by Licensor pursuant to this Agreement.
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b. During the five (5) year period immediately following the Effective
Date, all sublicenses to end-users by Licensee for the Software and/or
Derivative Software Products shall be in object-code-form only, except
(i) Licensee may, at its discretion, agree to an escrow arrangement
whereby the end-user may obtain the Source Code in the event of a
bankruptcy proceeding involving Licensee or other events of default by
Licensee as are customary in source code escrow agreements used in the
software industry; and (ii) Licensee may provide the Source Code to
end-users upon the prior written consent of Licensor, which consent
will not be unreasonably withheld, subject to use restrictions,
security procedures and confidentiality obligations reasonably
acceptable to Licensor.
3. USE OUTSIDE OF LICENSED FIELD OF USE. Licensee shall not use the Licensed
Trademark and/or the Software (or any portion thereof) outside of the
Licensed Field of Use, and any and all uses by Licensee of the Licensed
Trademark and/or the Software outside of the Licensed Field of Use are
strictly prohibited. Licensee acknowledges and agrees that Licensor has and
will continue to use the Source Code and/or grant licenses for the use of
the Source Code outside of the Licensed Field of Use.
ARTICLE III
DELIVERY AND ACCEPTANCE
1. DELIVERABLES. Upon execution of this Agreement by both parties hereto,
Licensor shall promptly deliver to Licensee a copy of the Source Code and
all existing user and programmer documentation relating to the Software, as
more fully described on Exhibit A attached hereto (collectively, the
"Deliverables").
2. SHIPMENT AND RISK OF LOSS. The Deliverables shall be shipped to Licensee
F.O.B. Licensee's receiving point, and thereupon Licensee shall assume the
risk of loss therefor.
3. ACCEPTANCE. Licensee shall have thirty (30) days after receipt of all
Deliverables (the "Acceptance Period") to accept or reject the Software.
Licensee agrees to accept the Software upon the successful (i) loading of
VoxelGeo(R) 2.0 code; (ii) compiling of VoxelGeo(R) 2.0 software; and (iii)
execution of mutually acceptable standard reliability demonstrations on the
hardware of Licensee at Licensee's location using the compiled object code.
Licensee hereby represents to Licensor that Licensee currently possesses
the hardware and software environment necessary to build and run the
Software, as more fully described on Exhibit B attached hereto. Licensee
shall notify Licensor in writing of acceptance or rejection within the
Acceptance Period. In the event the Software is rejected by Licensee, all
Deliverables shall be returned by Licensee to Licensor, at Licensee's
expense, and this Agreement shall be automatically terminated and of no
further force and effect except as provided in Article XI, Section 2
hereof.
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ARTICLE IV
LICENSE FEE; ROYALTIES
1. LICENSE FEE. Licensee shall pay to Licensor a license fee in the amount of
One Million Five Hundred Thousand and no/100 Dollars ($1,500,000.00), which
shall be paid in full by wire transfer, pursuant to wire transfer
instructions provided to Licensee by Licensor, within two (2) business days
following acceptance of the Software by Licensee in accordance with the
terms and conditions set forth in Article III, Section 3 above. Such
license fee shall not be deemed an advance of royalties and shall not be
recoupable from royalty payments due to Licensor pursuant to this Article
IV.
2. ROYALTY AMOUNT. Subject to Section 3 of this Article IV, Licensee shall
pay Licensor a royalty on all Net Receipts received by Licensee in
connection with the licensing or use of the Software or any Derivative
Software Products in accordance with the following schedule:
Royalty as a Percentage of
Net Receipts Received by
Licensee During the
Calendar Year Applicable Calendar Year
------------- --------------------------
1995 None
1996 15% on all Net Receipts in excess
of $2,000,000.00
1997 15% on all Net Receipts
1998 15% on all Net Receipts
1999 10% on all Net Receipts
2000 5% on all Net Receipts
3. LIMITATION ON ROYALTY OBLIGATION. The obligation of Licensee to pay
royalties to Licensor in accordance with Section 2 of this Article IV shall
cease on the earlier of (i) January 1, 2001, or (ii) such time as the
aggregate royalties actually paid by Licensee to Licensor (exclusive of the
up-front license fee payable by Licensee pursuant to Section 1 of this
Article IV) equals Two Million and no/100 Dollars ($2,000,000.00), and
thereafter the licenses granted to Licensee hereunder shall be deemed to be
fully paid. Licensor agrees that Licensee shall not be obligated to make
royalty payments with respect to any revenues received by Licensee in
connection with the following existing software products currently offered
by Licensee (even if such software products
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subsequently incorporate the Source Code or source code from software
derived from the Source Code as an upgrade): the 2D and 3D versions of each
of the following applications: Focus; Disco; GeoSec; GeoStrat and well log
interpretation software products based upon DLPS.
4. MARKETING OF SOFTWARE BY LICENSEE. Licensee shall use its good faith best
efforts to promote, market and sublicense the Software worldwide at all
times during which Licensee is obligated to make royalty payments to
Licensor hereunder.
5. ACCOUNTING. Until the earlier of (i) March 31, 2001, or (ii) such time as
the aggregate royalties actually paid by Licensee to Licensor (exclusive of
the up-front license fee payable by Licensee pursuant to section 1 of this
Article IV) equals Two Million and no/100 Dollars ($2,000,000.00), Licensee
shall provide Licensor within thirty (30) days following the end of each
calendar quarter with an accounting of all Net Receipts during the
immediately preceding calendar quarter.
6. TERMS OF PAYMENT. All royalties under this Agreement shall be paid in
United States currency. Royalty payments due to Licensor pursuant to
Section 2 of this Article IV shall be paid by Licensee within thirty (30)
days following the end of each calendar quarter based upon the total Net
Receipts during the immediately preceding calendar quarter.
7. MAINTENANCE AND INSPECTION OF RECORDS. Until the earlier of (i) March 31,
2001, or (ii) such time as the aggregate royalties actually paid by
Licensee to Licensor (exclusive of the up-front license fee payable by
Licensee pursuant to section 1 of this Article IV) equals Two Million and
no/100 Dollars ($2,000,000.00), Licensee will maintain records of all Net
Receipts. Licensor shall have the right, through a certified public
accountant, to inspect all the books and records of Licensee relating to
all Net Receipts subject to this Agreement, but such inspection may not be
made more frequently than annually. The cost of such inspection shall be
borne by Licensor; provided, however, that Licensee shall reimburse
Licensor for the reasonable costs of such inspection in the event there is
a discrepancy between the amount of royalties due Licensor under the terms
of this Agreement and the amount of royalties actually paid by Licensee to
Licensor for the time period corresponding to such inspection of records
that exceeds five percent (5%) of the amount of royalties actually due.
ARTICLE V
MODIFICATIONS OF SOFTWARE
1. MODIFICATION. Licensee may modify the Software and merge it into existing
software; provided, however, that (i) such modified Software and resulting
merged software shall be deemed to be Software under this Agreement and
shall be subject to all of the terms and conditions hereof; and (ii)
Licensor agrees that Licensee shall not be obligated to make royalty
payments with respect to any revenues received by Licensee in connection
with the following existing software products currently offered by Licensee
(even if such software products subsequently incorporate the Source Code or
source code
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from software derived from the Source Code as an upgrade): the 2D and 3D
versions of each of the following applications: Focus; Disco; GeoSec;
GeoStrat and well log interpretation software products based upon DLPS.
2. FUTURE ENHANCEMENTS. All future modifications and enhancements to the
Software by Licensee shall be owned by Licensee. Likewise, any future
enhancements or modifications to the Software made by Licensor shall be the
sole property of Licensor and shall not be subject to this Agreement except
as otherwise provided under Article VII, Section 6 hereof.
ARTICLE VI
PROPRIETARY RIGHTS
1. PROPRIETARY RIGHTS. Licensee acknowledges that Licensor claims the
Licensed Trademark and the Software are the exclusive property of Licensor
and that the Source Code constitutes a valuable trade secret of Licensor.
Licensee shall take all reasonable security measures to protect the Source
Code and, except as otherwise provided in clause (i) of Section 2 of
Article II of this Agreement, Licensee shall not disclose or make available
the Source Code to third parties without Licensor's prior written consent.
In any event, prior to delivery of the Source Code by Licensee to any third
party in accordance with the terms and conditions of this Agreement, for
any purpose whatsoever, Licensee shall obtain a written confidentiality and
nondisclosure agreement from such third party and a license agreement from
such third party upon terms and conditions that are no less restrictive
than the terms and conditions of this Agreement. Licensee shall enforce any
and all terms and conditions of all confidentiality and non-disclosure
agreements and license agreements that are entered into by Licensee
pursuant to the preceding sentence, at its own expense, and shall notify
Licensor of any knowledge of infringement of Licensor's intellectual
property rights by any third party. Licensee understands that any
unauthorized use by it of the Licensed Trademark, the Software and/or the
Source Code may constitute an infringement of copyright, trademark, trade
secret or patent rights of Licensor.
2. RIGHTS RESERVED. All rights in the Licensed Trademark and the Software,
other than those granted by this Agreement, are hereby reserved by
Licensor.
3. PROTECTION OF PROPRIETARY RIGHTS. Licensee shall insure that Licensor's
copyright notice is replicated on all copies of the Software and/or
Derivative Software Products produced by Licensee or its sublicensees,
including any and all copies of modifications made in accordance with
Article V, Section 1 hereof. Licensee shall assist Licensor, to the extent
reasonably requested by Licensor, in the procurement of any protection or
defense of any of Licensor's rights to (i) trademarks; (ii) copyright(s);
or (iii) patents owned by Licensor that relate to the subject matter of
this Agreement.
4. PROPRIETARY RIGHTS INDEMNITY. Licensor shall indemnify, hold harmless and
defend Licensee, its agents, officers and employees against any and all
claims made against Licensee that use of the Licensed Trademark and/or the
Software infringes any
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license, patent, copyright, trademark, trade secret or other proprietary
right, and hold Licensee harmless against any and all damages, judgments
and attorneys' fees arising out of the foregoing; provided, however, that
Licensee shall give Licensor prompt written notice of such claims and that
such indemnity shall not extend to modifications of the Software made by
Licensee or its sublicensees.
ARTICLE VII
MAINTENANCE
1. LICENSEE'S OPTION. Licensee shall have the option to receive from Licensor
maintenance services relating to the Rendering Engine portion only of the
Software (hereinafter more fully described and defined as the "Maintenance
Services") upon the terms and conditions set forth in this Article VII.
Such option shall be exercised by Licensee by the giving of prior written
notice to Licensor specifying that Licensee wishes to receive Maintenance
Services. Licensee's option to receive Maintenance Services pursuant to
this Article VII shall expire and become null and void thirty (30) days
following expiration of the Warranty Period if such right had not
previously been exercised by Licensee.
2. MAINTENANCE SERVICES. Licensor shall provide Maintenance Services to
Licensee only if Licensee has exercised its option to receive Maintenance
Services in accordance with Section 1 of this Article VII. Such Maintenance
Services shall consist of consulting services and error correction
services. Such services are referred to herein as the "Maintenance
Services." Solely for the purposes of Sections 2 and 3 of this Article VII,
the term "Software" shall mean only the Rendering Engine portion of the
Software. Error correction services provided by Licensor shall consist of
any necessary changes made to the Source Code, as originally delivered to
Licensee, in order to correct or remove any bug, malfunction or other
defect that prevents the Software from performing in accordance with the
Functional Specifications. In the event Licensee detects any error, defect
or nonconformity in the Software, Licensor shall furnish off-site telephone
support, in the form of consultations, assistance and advice on the use or
maintenance of the Software, within twenty-four (24) hours of Licensee's
request therefor. In the event that such problem in the Software is not
corrected within seventy-two (72) hours of initiation of such off-site
telephone support, Licensee shall submit to Licensor a listing of the
output and all such other data that Licensor may reasonably request in
order to reproduce operating conditions similar to those present when the
error, defect or nonconformity was discovered. In the event that such
problem is not corrected within five (5) business days after Licensor
receives from Licensee a listing of output and other data, Licensor shall
within the next seventy-two (72) hours provide on-site service.
3. RESPONSIBILITIES OF LICENSEE. Licensee shall notify Licensor immediately
following the discovery of any error, defect or nonconformity in the
Software. The periods within which Licensor is obligated herein to provide
support shall not commence until such time as Licensor receives
notification of such error, defect or nonconformity from Licensee.
Licensee, upon detection of any error, defect or nonconformity in the
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Software shall, if requested to do so by Licensor, submit to Licensor a
listing of output and any such other data that Licensor may reasonably
request in order to reproduce operating conditions similar to those present
when the error occurred or the defect or nonconformity was discovered, as
the case may be.
4. MAINTENANCE FEES. In consideration for the Maintenance Services, Licensee
shall pay Licensor a monthly fee of $5,000.00 (payable on or before the
15th of each calendar month during which services are to be rendered to
Licensee by Licensor).
5. TERM. Subject to Article XI hereof, in the event Licensee exercises its
option to receive Maintenance Services with respect to the Rendering
Engine, Licensor will render Maintenance Services for the Rendering Engine
for a period of one year. Thereafter, Licensor's obligations to render
Maintenance Services for the Rendering Engine, and Licensee's obligations
to pay for such services, shall automatically be renewed for an additional
period of one year; provided, however, that either party may prevent the
automatic renewal of such obligations by written notice to the other given
at least thirty (30) days prior to expiration of the initial one-year term
set forth in the preceding sentence.
6. ENHANCEMENTS. Licensor may from time to time make enhancements to the
Software. Any such enhancements shall be owned by Licensor, but any
enhancements made by Licensor during such time as Licensee is paying
Licensor a maintenance fee under this Article VII shall be made available
to Licensee, at no additional cost, and shall be subject to the terms and
conditions of this Agreement; provided, however, that Licensee has fully
complied with all the terms and conditions of this Agreement.
ARTICLE VIII
RELATED AGREEMENTS
1. EXISTING MARKETING AGREEMENT. Upon the Effective Date, that certain
Marketing Agreement dated as of August 1, 1994, between Licensor and
Licensee, as amended to date (the "Marketing Agreement"), shall be deemed
terminated and of no further force and effect. Notwithstanding termination
of the Marketing Agreement upon the Effective Date, (i) all provisions
therein relating to confidentiality, proprietary property, copyrights,
trademarks and patents shall remain in full force and effect; (ii) each of
the parties shall be required to carry out any provision thereof that
contemplates performance subsequent to termination of the Marketing
Agreement; and (iii) such termination shall not affect any liability or
other obligation that shall have accrued prior to such termination,
including, but not limited to, any liability for loss or damage on account
of a prior default or claims for compensation for any period prior to such
termination.
2. EXISTING LICENSES AND MAINTENANCE AGREEMENTS.
a. Copies; Offset Against License Fee. Set forth on Exhibit C attached
hereto is a listing of all existing License Agreements between
Licensor and/or Licensee and
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end-users for use of the Software ("Existing Licenses") and set forth
on Exhibit D attached hereto is a listing of all end-users that have
agreements with Licensor for maintenance of the Software (the
"Existing Maintenance Contracts"). Licensor shall supply Licensee with
copies of all Existing Licenses that have been initiated by Licensor
and copies of purchase orders from end-users relating to the Existing
Maintenance Contracts. Licensee shall be entitled to offset the
license fee payable by Licensee to Licensor pursuant to Article IV,
Section 1 hereof by an amount equal to Licensor's portion of unearned
maintenance fees under Existing Maintenance Contracts (for example, if
an annual Maintenance Contract has three months left on its term, then
Licensee will be entitled to a credit for 25% of Licensor's share of
such maintenance fees as such share is determined pursuant to the
Marketing Agreement).
b. Assignment and Assumption. Licensor hereby assigns to Licensee all of
Licensor's right, title and interest in and to the Existing Licenses
and the Existing Maintenance Contracts and Licensee hereby accepts
such assignment. Licensee hereby further assumes and agrees to be
bound by all the remaining terms of the Existing Licenses and the
Existing Maintenance Contracts as if Licensee was an original party
thereto. To the extent that any Existing License or Existing
Maintenance Contract for which assignment to Licensee is provided
herein is not assignable without the consent of another party, this
Agreement shall not constitute an assignment or an attempted
assignment thereof if such assignment of attempted assignment would
constitute a breach thereof. Licensor and Licensee agree to use their
reasonable best efforts to obtain the consent of such other party to
the assignment of any such Existing License and/or Existing
Maintenance Contract to Licensee in all cases in which such consent is
or may be required for such assignment. If any such consent shall not
be obtained, Licensor agrees to cooperate with Licensee in any
reasonable arrangement designed to provide for Licensee the benefits
intended to be assigned to Licensee under the relevant Existing
License or Existing Maintenance Contract, including enforcement, at
the cost and for the account of Licensee, of any and all rights of
Licensor against the other party thereto arising out of the breach or
cancellation thereof by such other party or otherwise. If and to the
extent that such arrangement cannot be made, Licensee, upon notice to
Licensor, shall have no obligation with respect to any such Existing
License and/or Existing Maintenance Contract, as the case may be, and
any such Existing License and/or Existing Maintenance Contract shall
not be deemed to have been assigned hereunder.
3. CUSTOMER DIRECTED DEVELOPMENT INITIATIVE.
a. Copies; Offset Against License Fee. Set forth on Exhibit E attached
hereto is a listing of all Customer Directed Development Initiative
("CDDI") Agreements between certain oil companies and Licensor (the
"CDDI Agreements"). Prior to expiration of the Acceptance Period,
Licensor shall supply Licensee with copies of all the CDDI Agreements.
Licensee shall be entitled to offset the license fee
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payable by Licensee to Licensor pursuant to Article IV, Section 1
hereof by an amount equal to the unearned portion of fees previously
collected by Licensor from CDDI members.
b. Assignment and Assumption. Licensor hereby assigns to Licensee all of
Licensor's right, title and interest in and to the CDDI Agreements and
Licensee hereby accepts such assignment. Licensee hereby further
assumes and agrees to be bound by all the remaining terms of the CDDI
Agreements as if Licensee was an original party thereto. To the extent
that any CDDI Agreement for which assignment to Licensee is provided
herein is not assignable without the consent of another party, this
Agreement shall not constitute an assignment or an attempted
assignment thereof if such assignment of attempted assignment would
constitute a breach thereof. Licensor and Licensee agree to use their
reasonable best efforts to obtain the consent of such other party to
the assignment of any such CDDI Agreement to Licensee in all cases in
which such consent is or may be required for such assignment. If any
such consent shall not be obtained, Licensor agrees to cooperate with
Licensee in any reasonable arrangement designed to provide for
Licensee the benefits intended to be assigned to Licensee under the
relevant CDDI Agreement, including enforcement, at the cost and for
the account of Licensee, of any and all rights of Licensor against the
other party thereto arising out of the breach or cancellation thereof
by such other party or otherwise. If and to the extent that such
arrangement cannot be made, Licensee, upon notice to Licensor, shall
have no obligation with respect to any such CDDI Agreement, as the
case may be, and any such CDDI Agreement shall not be deemed to have
been assigned hereunder.
ARTICLE IX
WARRANTIES
1. WARRANTIES OF LICENSOR. Licensor hereby represents and warrants only to
Licensee that:
a. Neither the Licensed Trademark nor the Software infringe any patent,
copyright, trade secret or other proprietary right of any third party;
b. Licensor has the sole right to grant licenses for use of the Licensed
Trademark and the Software and has not heretofore granted any rights
in the Licensed Trademark or the Software that would interfere with
any rights granted Licensee under this Agreement;
c. Licensor has the right to enter into this Agreement, to grant to
Licensee the rights and licenses set forth herein, and to perform all
obligations of this Agreement;
d. Execution, delivery and performance of this Agreement by Licensor will
not constitute a breach of any agreement, judgment, award, law, rule
or regulation to which Licensor is bound; and
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e. During the sixty (60) day period following the Effective Date (the
"Warranty Period"), Licensor will provide consulting services to
Licensee relating to the Software free of charge (other than
reimbursement for pre-approved out-of-pocket expenses), and Licensor
warrants that during the Warranty Period the Software will conform to
the performance capabilities, characteristics, specifications,
functions and other descriptions and standards applicable thereto as
set forth in the functional specifications set forth in the
VoxelGeo(R) 2.0 User Guide, copyright July 1995 (the "Functional
Specifications").
2. LIMITATION OF WARRANTIES. Licensor shall not be liable to Licensee for the
warranty provisions of this Agreement to the extent of modifications made
to the Software by Licensee or sublicensees of Licensee or to the extent
the media for the Software is subject to misuse, abuse or abnormal use by
Licensee or sublicensees of Licensee. EXCEPT AS EXPRESSLY SET FORTH IN
SECTION 1 OF THIS ARTICLE IX, LICENSOR MAKES NO EXPRESS OR IMPLIED
WARRANTIES RELATING TO THE SOFTWARE OR ITS USE OR FUNCTIONALITY, AND
SPECIFICALLY DISCLAIMS THE IMPLIED WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE.
3. REMEDIES. Licensee's sole remedy for any breach of the warranties contained
in Article IX, Section 1.e. is repair or correction of any programming
deficiencies that result in documented errors or obvious Software
malfunctions. NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY,
LICENSOR SHALL UNDER NO CIRCUMSTANCES BE LIABLE TO LICENSEE OR ANY THIRD
PARTY FOR SPECIAL INCIDENTAL, CONSEQUENTIAL, OR EXEMPLARY DAMAGES OF ANY
NATURE WHATSOEVER, INCLUDING, BUT NOT LIMITED TO, COMMERCIAL LOSS FROM ANY
CAUSE, BUSINESS INTERRUPTION OF ANY NATURE, LOSS OF PROFITS, OR PERSONAL
INJURY ARISING OUT OF LICENSOR'S ALLEGED OR ACTUAL FAILURE TO COMPLY WITH
ALL OR ANY OF THE PROVISIONS OF THIS AGREEMENT AND/OR THE FAILURE OF THE
SOFTWARE TO PERFORM AS SPECIFIED OR WARRANTED, EVEN IF LICENSOR SHALL HAVE
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
4. WARRANTIES OF LICENSEE. Licensee hereby represents and warrants that:
a. Licensee has the full right, power and authority to enter into and
perform its obligations under this Agreement;
b. Execution, deliver and performance of this Agreement by Licensee will
not constitute a breach of any agreement, judgment, award, law, rule
or regulation to which Licensee is bound; and
c. To the best of Licensee's knowledge, neither the Licensed Trademark
nor the Software infringe any patent, copyright, trade secret or other
proprietary right of any third party.
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ARTICLE X
NONCOMPETE OBLIGATIONS
1. LICENSEE'S COVENANT NOT TO COMPETE. From the Effective Date and for a
period of five (5) years thereafter, Licensee shall not, either directly or
indirectly, grant any licenses under, or provide any services relating to,
the Software or any other software that is based upon the Voxel technology
to any corporation, partnership, person, firm or other business that is
selling goods or rendering services that is engaged in the medical market.
Licensee agrees that any breach of the covenant set forth in the preceding
sentence will cause Licensor irreparable harm for which there is no
adequate remedy at law, and, without limiting whatever other rights and
remedies Licensor may have under this Agreement, Licensee consents to the
issuance of an injunction in favor of Licensor enjoining the breach of any
of the aforesaid covenants by any court of competent jurisdiction. If the
aforesaid covenant is held to be unenforceable because of the scope or
duration of such covenant or the area covered thereby, the parties agree
that the court making such determination shall have the power to reduce the
scope, duration and/or area of such covenant to the extent that allows the
maximum scope, duration and/or area permitted by applicable law.
2. LICENSOR'S COVENANT NOT TO COMPETE. From the Effective Date and for a
period of five (5) years thereafter and so long as Licensee is in full and
timely compliance with this Agreement, Licensor shall not, either directly
or indirectly:
a. own, manage, operate or control, or participate in the ownership,
management, operation or control of, or be employed by, or act as
consultant or adviser to, or be connected in any manner with, any
corporation, partnership, person, firm or other business that is
engaged in the gas, oil or mineral exploration industries; or
b. call upon, solicit, divert, attempt to take away or continue any
business relationship with any of the present customers or present or
future customers or business of Licensee in the gas, oil or
exploration industries; or
c. employ or offer employment to any person who was employed by Licensee
unless such person shall have ceased to be employed by Licensee for a
period of at least six (6) months.
Licensor agrees that any breach of covenants (a), (b) or (c) above will
cause Licensee irreparable harm for which there is no adequate remedy at law,
and, without limiting whatever other rights and remedies Licensee may have under
this Agreement, Licensor consents to the issuance of an injunction in favor of
Licensee enjoining the breach of any of the aforesaid covenants by any court of
competent jurisdiction. If any or all of the aforesaid covenants are held to be
unenforceable because of the scope or duration of such covenant or the area
covered thereby, the parties agree that the court making such determination
shall have the power to reduce the scope, duration and/or area of such covenant
to the extent that allows the maximum scope, duration and/or area permitted by
applicable law.
13
ARTICLE XI
TERMINATION
1. TERMINATION. This Agreement may be terminated upon the occurrence of one or
more of the following events, and the terminating party shall not be liable
to the other party for the proper exercise of such right:
a. Rejection of Software. This Agreement shall automatically terminate
and be of no further force and effect in the event the Software is
rejected by Licensee in accordance with Article III, Section 3 hereof.
b. Option to Terminate. This Agreement may be terminated at the option of
the non-defaulting party upon the material breach of one of the
parties of their obligation to perform or comply with the terms and
conditions of this Agreement, or on the mutual written consent of both
parties hereto, or as otherwise hereinafter set forth. In the event of
the parties finds the other in material breach of this Agreement,
notice of such breach shall be sent to the defaulting party in
writing. If the breach continues for thirty (30) days after receipt by
the defaulting party of the notice, the Agreement shall be
automatically terminated.
c. Events of Automatic Termination. This Agreement shall terminate
immediately and automatically upon the filing of a petition in
bankruptcy under the United States Bankruptcy Code (or any future
federal bankruptcy act) by or against Licensee and such petition shall
not be discharged or denied within thirty (30) days after the filing
thereof.
2. EFFECT OF TERMINATION. Upon termination of this Agreement for whatever
reason, all provisions relating to confidentiality, proprietary property,
copyrights, trademarks and patents shall remain in full force and effect,
and Licensee shall return the Software and all copies in Licensee's
possession and control to Licensor. Notwithstanding the termination or
expiration of this Agreement, each of the parties hereto shall be required
to carry out any provision hereof that contemplates performance subsequent
to such termination; and such termination shall not affect any liability or
other obligation that shall have accrued prior to such termination,
including, but not limited to, any liability for loss of damage on account
of a prior default. Any rights and remedies herein provided shall be
cumulative and in addition to all rights and remedies available at law and
in equity.
ARTICLE XII
MISCELLANEOUS PROVISIONS
1. BENEFIT. Except as otherwise provided herein, this Agreement shall inure to
the benefit of and shall be binding upon the parties hereto and their
respective heirs, executors, administrators, representatives, successors
and assigns.
14
2. NO ASSIGNMENT. During the Initial License Period, except as otherwise
expressly provided in this Agreement, this Agreement and all rights and
licenses granted or obligations incurred hereunder may not be assigned or
transferred by either party without the prior written consent of the other
party, and any such attempted assignment or transfer shall be void and of
no force or effect. Nothing contained in this Section 2 of Article XII
prohibits Licensee from merging with an affiliated entity or prevents
Licensee from selling substantially all of its business assets to an
affiliated entity and such events shall not constitute a breach of this
Section 2 of Article XII.
3. EQUITABLE RELIEF. The parties hereto agree that any breach of any of the
terms or covenants of this Agreement will cause the non-breaching party
irreparable harm for which there is no adequate remedy at law, and the
parties hereto consent to the issuance of any injunction or other equitable
relief in favor of the non-breaching party enjoining the breach of any such
covenant or term. In no manner or affect shall this provision of this
Agreement preclude the non-breaching party from exercising any right or
remedy to which the non-breaching party may be entitled, at law or in
equity, by reason of a breach of any term or covenant of this Agreement.
4. ARBITRATION. Except for claims for equitable relief in accordance with
Section 3 of this Article XII, any dispute, controversy or claim arising
out of or relating to this Agreement, or the breach, termination or
invalidity thereof, shall be finally settled by arbitration in accordance
with the Commercial Arbitration Rules of the American Arbitration
Association in effect on the date of the Agreement, and judgment upon the
award rendered by the Arbitrator(s) may be entered in any court having
jurisdiction thereof. The place of arbitration shall be Minneapolis,
Minnesota.
5. ATTORNEYS' FEES AND COSTS. The party prevailing in any legal action
(including arbitration) arising under or relating to this Agreement, shall
be entitled to recover from the other party all of its costs and expenses,
including, without limitation, reasonable attorneys' fees.
6. WAIVER, MODIFICATION OR AMENDMENT. Unless otherwise expressly provided in
this Agreement and any documents expressly referred to herein, no waiver,
modification or amendment of any term, condition or provision of this
Agreement shall be valid, binding or of any effect unless made in writing,
expressly referring to this Agreement, signed by or on behalf of the
parties hereto, and specifying with particularity the nature and extent of
such waiver, modification or amendment. Any waiver by any party of any
provision hereof shall not affect or impair any other provision hereof. The
failure of either party to enforce at any time any of the provisions of
this Agreement shall not be construed to be a waiver of the right of such
party to subsequently enforce any such provisions.
7. NOTICES. All notices or other communications given under or in connection
with this Agreement shall be in writing and shall be considered to be
delivered when personally delivered or five (5) days after delivery to a
company or governmental entity providing
15
delivery services in the ordinary course of business which guarantees delivery
within such five-(5) day period, with the delivery charge prepaid, addressed to
the proper party at its principal office as set forth above, or to such other
address as such party may hereafter designate by written notice to the other
party given pursuant to this paragraph.
8. COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but together which shall
constitute one and the same instrument.
9. LEGAL RELATIONSHIP. Licensee and Licensor hereby acknowledge and agree that
nothing contained in this Agreement shall be deemed to create an
employment, agency, franchise, or other relationship between Licensee and
Licensor for any purpose whatsoever and that no relationship is intended or
created hereby other than the relationship of independent contractors.
Neither party shall have the right or authority to assume or create any
obligation or responsibility, express or implied, on behalf of, on account
of, or in the name of the other party, or to legally bind the other party
in any manner whatsoever.
10. HEADINGS. Section headings used herein are for convenience only and shall
not be construed to be a part of this Agreement or as a limitation of the
scope of the particular sections to which such headings refer.
11. INTERPRETATION AND SEVERANCE. The provisions of this Agreement shall be
applied and interpreted in a manner consistent with each other so as to
carry out the purposes and intent of the parties hereto, but if for any
reason any provision hereof is determined to be unenforceable or invalid,
such provision or such part hereof as may be unenforceable or invalid shall
be deemed severed from this Agreement, and the remaining provisions shall
be carried out with the same force and effect as if the provision or part
thereof had not been a part of this Agreement.
12. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Iowa, and any proceedings for
enforcement hereof shall be brought in federal or state courts located in
Iowa. Licensor and Licensee consent and submit to the jurisdiction of said
courts and agree that service of process may be made by publication, by
registered or certified mail or in any manner provided under Iowa or
applicable federal law. Nothing herein shall prevent a party hereto from
joining the other party as additional defendants or third-party defendants
in any suit brought by or against such party in another forum if any issue
in said suit relates to the matters referred to herein.
13. ENTIRE AGREEMENT. This Agreement, including any exhibits attached hereto or
documents expressly referred to herein, contains the entire agreement
between Licensee and Licensor and supersedes and cancels any and all other
agreements, whether oral or in writing, between Licensee and Licensor with
respect to the matters referred to herein.
16
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
LICENSOR: LICENSEE:
VITAL IMAGES, INC. COGNISEIS DEVELOPMENT, INC.
By: /S/ XXXXXXX XXXXXX By: /S/ XXXXXXX X. XXX
----------------------------- -----------------------------
Xxxxxxx Xxxxxx, President Xxxxxxx X. Xxx, President
17
EXHIBIT A
---------
DELIVERABLES
. All source code, user documentation, programmer documentation and supporting
files necessary to build VoxelGeo 2.0 on magnetic tape.
. Product Definition Statements and draft Software Requirement Specifications
for VoxelGeo 2.1 (planned release October 1995), and VoxelGeo 2.5 (planned
release March 1996).
. Copies of Existing Licenses that have been initiated by Licensor,
. Copies of CDDI Agreements.
. Copies of purchase orders from end-users relating to Existing Maintenance
Contracts.
18
EXHIBIT B
---------
SUPPORTED ENVIRONMENT
The hardware/software environment necessary for Licensee to build VoxelGeo 2.0
consists of:
. Silicon Graphics Indy, Indigo2 or Onyx workstation with at least 64MB of RAM
and 200MB of free disk space running the IRIX 5.3 operating system.
. Silicon Graphics development tools and libraries as follows:
- IRIS Development Option for IRIX 5.3
- C++ 4.0 for IRIX 5.3
- OpenInventor 3D Toolkit Development Option for IRIX 5.3
- Digital Media Development Software Libraries
- Quick Time 1.0 Compressor Library
The hardware/software environment necessary for Licensee to run VoxelGeo 2.0
consists of:
. Silicon Graphics Indy XZ, Indigo2 XZ or EX, Crimson RE or Onyx VTX or RE2
workstation with at least 96MB of RAM and 200MB of free disk space.
- For Indy XZ and Indigo2 XZ or EX, SGI patch 158 to IRIX 5.3 is required
- For Crimson RE or Onyx VTX or XX0, XXX patch 154 to IRIX 5.3 is required
19
EXHIBIT C
---------
LISTING OF EXISTING LICENSES
(ATTACHED)
20
EXHIBIT D
---------
LISTING OF EXISTING MAINTENANCE CONTRACTS
(ATTACHED)
21
EXHIBIT E
---------
LISTING OF CDDI AGREEMENTS
(ATTACHED)
22
