EXHIBIT 10.7
ASSET PURCHASE AND DEVELOPMENT AGREEMENT
THIS ASSET PURCHASE AND DEVELOPMENT AGREEMENT, ("Agreement") is entered into as
of January 20, 1999 by and among Orca Technologies, Inc., a Utah Corporation
("Buyer" or "ORCA"), and, Millennium Software, Inc., a Washington corporation
("Seller") and Xx. Xxxx Xxxxx ("Xxxxx").
RECITALS
A. Buyer is engaged in the business of developing, marketing and providing
services relating to a system of proprietary products intended to assist
healthcare providers automate the process of defining, providing,
documenting and analyzing care provider operations, (the "business").
B. Seller is the developer, marketer, and service provider for two proprietary
software products commonly known as a "Dispatch" and "Sentry" (the
"Products"). Xxxxx is the President and Chief Executive officer of Seller,
and the inventor of the products.
C. Seller now desires to sell, and buyer desires to buy the Products. The
parties also agree that the Products will be further developed and
integrated into buyer's existing programs, on the terms and conditions set
forth in this Agreement.
AGREEMENT
---------
In consideration of the covenants in this Agreement, the parties agree as
follows:
SECTION 1
PURCHASE AND SALE OF ASSETS
---------------------------
1.1 PURCHASE AND SALE. Upon the execution of this Agreement, Seller will sell,
transfer, assign, convey and deliver to Buyer, and Buyer will purchase from
seller all rights, title and interest in the computer software programs
known as "Dispatch" and "Sentry". These programs are more specifically
described in "Exhibit A" attached hereto and incorporated into this
Agreement, (the "Products").
1.2 OWNERSHIP. Full and exclusive rights and ownership of the Products and in
any and all related letters patent, trademarks, copyrights, trade secrets,
Confidential Information and any other proprietary rights which Seller
possesses or is entitled to including the source code, object code, and
technical documentation, shall vest in and is hereby assigned to Buyer as
of the date of execution of this Agreement. Except as provided in this
Agreement, Seller
shall retain no right, ownership of title in the Products or in any related
letters patent, trademarks, copyrights, trade secrets, Confidential
Information or any other proprietary rights. The parties agree that the
Products, both as they exist at the time of this agreement is executed, and
as they exist after further development and all such rights thereto are
being sold in their entirety to Buyer for whatever use it desires, and
nothing contained herein shall be deemed to constitute a mere license or
franchise in Seller.
1.3 PERFECTION OF PROPRIETARY RIGHTS; COOPERATION BY SELLER. Should Buyer or
any of its agents or representatives seek to obtain letters patent,
trademarks, or copyrights in any country of the world on all or part of the
Products, Seller, and its agents and representatives agree to cooperate
fully without compensation in providing information completing forms,
performing actions and obtaining the necessary signatures or assignments
required to obtain such letters patent, trademarks or copyrights. In the
event Buyer shall be unable for any reason to obtain Seller's signature on
any document necessary for any purpose set forth in the foregoing sentence,
Seller hereby irrevocably designates and appoints each of Buyer and its
duly authorized officers and agents as Seller's agent and Seller's
attorney-in-fact to act for and in Seller's behalf and stead to execute and
file any such document and to do all other lawfully permitted acts to
further any such purpose with the same force and effect as if executed and
delivered by Seller.
1.4 EXCLUDED ASSETS. The Seller shall have the limited right and obligation
to continue with the maintenance and exploitation of the application of
"Dispatch" which has been, previous to this Agreement, contracted to the
University of Virginia, University of California in Los Angeles, and
Massachusetts Institute of Technologies. No other exploitation of the
acquired system shall be permitted without Buyer's prior written agreement.
SECTION 2
DEVELOPMENT AND INTEGRATION
---------------------------
2.1 DEVELOPMENT, ENHANCEMENT AND INTEGRATION. The Parties agree, that an
integral element of this contract is the participation of the Seller in
performing compensated work as directed by the Buyer, whether as
consultants, or contractors to, or employees of Buyer, in the further
development and enhancement of the Product in order that they become
integrated and efficiently operable with Buyer's CuraSys System and other
applications. Buyer agrees to employ Xxxxx for this purpose in accordance
with the employment terms provided in "Exhibit B" of this agreement and
contract with Seller the services of Xxxx Xxxxxxxx for a period of at least
six months in accordance with the employment terms provided in "Exhibit E"
of this agreement.
2.2 DELIVERABLES. Seller agrees that periodically upon request, or upon
completion or termination of this Agreement, for whatever cause and without
regard to whether the integration has been completed, copies of all
notebooks, data, information and other material acquired or compiled by
Seller as Developer in respect to the integration, including source code,
object code and technical documentation, shall be delivered to Buyer.
SECTION 3
CONSIDERATION
-------------
3.1 PURCHASE PRICE. The Purchase Price shall be One Hundred and Fifty Thousand
Dollars ($150, 000.) to be paid as follows:
3.1.1 Xxxxx began his full time employment with Buyer on November 15,
1998. (The terms of his employment are described in "Exhibit B" to
this Agreement.) Xxxxx received his first bi-monthly salary
installment on November 30, 1998. On the date of execution of this
agreement Buyer will pay Seller an installment toward the purchase
price of the above described software products, in the amount of
forty thousand ($40,000.) dollars. Additional purchase installments
of ten thousand ($10,000.) each will be paid to Seller with his bi-
monthly salary installments on February 1, 1999 and February 15,
1999. These, and following payments, are conditioned on Xxxxx'x
continuation as a full-time employee of Buyer (except in the case
that Xx. Xxxxx is severely disabled or deceased), and on the
condition that he is performing the duties agreed upon, and, the
other terms and conditions of this "Asset Purchase and Development
Agreement are being met.
3.1.2 To complete the purchase of the assets described, Buyer will make a
final payment to the Seller on March 1, 1999 in the amount of ninety
thousand ($90,000.)
3.2 ORCA STOCK. As an additional condition of this purchase, Seller shall be
granted Thirty Five Thousand (35,000) shares of ORCA Common Stock (the
"Shares"). The shares will be issued to Seller immediately, but will be
held in an escrow account established with counsel to Buyers, Van
Valkenberg Xxxxxx Law Group, PLLC, under the condition that they will not
be delivered to Seller until April 1, 1999. Buyer agrees to fully cooperate
in the effort to integrate the Products into CuraSys in a timely manner
according to the directives of the Buyer. Failure of Buyer to cooperate
reasonably with the integration effort will result in the immediate
delivery of the shares above referenced, to Seller. The shares issued
according to this section of this agreement will be restricted from resale
pursuant to Securities Exchange Commission ("SEC") Regulation 144.
3.3 BRIDGE FINANCING. In the interim period between the signing of a "Letter
of Intent" between the parties, May 29, 1998, and the time of the signing
of this definitive agreement, the Buyer has made several bridge loans to
Seller. These loans include (2) bridge loan installments in the amount of
twelve thousand eight hundred ($12,800.) made on November 3, 1998, and
another, in the amount of nine thousand nine hundred, ($9,900.) which was
made on November 15, 1998. Xxxx Xxxxx and Seller have provided programming
services to Buyer beginning May 29, 1998 through Nov 15, 1998 and therefore
have no obligation to repay Buyer for these "bridge loans". Xx. Xxxxx does
agree to repay personal loans he received from Xx. Xxxxxx Xxxxxxx of Orca
Technologies, made on May 15, 1998, ($2,500) and January 8, 1999, ($5,000),
with said repayment to be made on or before January 31, 1999.
3.4 EMPLOYMENT AGREEMENT. As part of the mutual consideration for the
performance of this contract, Buyer agrees to employ Xxxxx and Xxxxx agrees
to perform, as a full time employee of Buyer. Seller anticipates directing
Xxxxx to enhance and integrate the Product so they work efficiently with
Buyer's CuraSys System and other applications existing and planned for the
future. The "Employment Agreement", which fully defines the terms of
employment is attached hereto and incorporated into this Agreement as
"Exhibit B".
3.5 NO OTHER OBLIGATIONS. Except as set forth above, Buyer will not assume
and will not be liable for any liabilities of Seller, known or unknown
contingent or absolute, accrued or otherwise, including, but not limited
to, liabilities or obligations of Seller (a) for taxes of any kind, (b) to
any shareholder, employee, officer or director of Seller for any reason,
(c) relative to Seller's issuance of securities, or (d) under any
environmental law.
3.6 ALLOCATION OF PURCHASE PRICE. The Purchase Price shall be allocated among
the Assets as set forth on the Schedule, which is part of Exhibit C to this
agreement. The parties agree that the fair market value of the Assets which
constitute Class I, II, III, IV and V Assets (as defined in Treasury
Regulation Section 1.1060-II (d), as amended) will be as set forth on
Internal Revenue Service Form 8594 in the form, and attached to this
Agreement before Closing as a sub section of Exhibit C (the "Form 8594").
The allocation set forth in the Form 8594 will be binding on Buyer and
Seller for all federal, state and local tax purposes. Buyer and Seller
agree to attach the Form 8594 in such form to their respective federal
income tax returns filed under Section 1060 of the Internal Revenue Code,
as amended, and the failure to do so will constitute a material breach of
this Agreement.
SECTION 4
CLOSING
-------
Subject to satisfaction of the closing conditions set forth herein, the
closing of the transactions contemplated in this Agreement (the "Closing") shall
take place at 5:00 P.M on January 20, 1999 at the headquarters of ORCA
Technologies, Inc., 24000 00xx Xxxxxx X.X., Xxxxx 000, Xxxxxxx, Xxxxxxxxxx,
00000, or, at such other time and place that the parties may agree upon.
SECTION 5
REPRESENTATIONS AND WARRANTIES OF BUYER
---------------------------------------
Buyer represents and warrants to Seller that the following it true and
correct as of the date of this Agreement.
5.1 AUTHORIZATION. Buyer is a corporation duly organized and validly
existing under the laws of Utah. Buyer has taken all corporate action
necessary to authorize execution and delivery of the Transaction
Documents and performance of their respective obligations thereunder.
Buyer has full corporate power and authority to enter into the
Transaction Documents and to carry out the terms hereof. Buyer has
duly executed and delivered this Agreement, and this Agreement
constitutes, and the Transaction Documents to which Buyer is a party
upon its due enforceable in accordance with their terms, except (i)
that such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or similar laws
affecting creditors' rights, and (ii) that the remedy of specific
performance and injunctive and other forms of equitable relief are
subject to certain equitable defenses and to the discretion of the
court before which any such proceedings therefore may be brought. No
authorization, consent or approval of, any public body or authority is
necessary to be obtained by Buyer for the consummation by it of the
transactions contemplated by this Agreement. No authorization, consent
or approval of any third party is necessary for the consummation by
Buyer of the transaction contemplated by this Agreement.
5.2 CAPITALIZATION. Buyer/ORCA. The authorized capital stock of ORCA
consists of 50,000,000 shares of Common Stock, par value $0.001 per
share, of which approximately 13,854,407 shares are issued and
outstanding as of the date of this Agreement. All of the issued and
outstanding shares of ORCA's Common Stock are, and the Shares of
Common Stock to be issued upon consummation of the transactions
contemplated by this Agreement shall be, duly and validly issued and
outstanding and fully paid and nonassessable. The Shares to be issued
pursuant to this Agreement, when issued, shall be free of
any liens, except as otherwise stated in Section 5.2. As of the date of
this Agreement, ORCA has reserved 3,000,000 shares of Common Stock for
issuance under its 1996 Stock Incentive Plan, pursuant to which no options
for the purchase of shares of Common Stock are outstanding as of the date
of this Agreement. In addition, there are 65,000 shares of Common Stock
reserved for issuance upon exercise of certain stock purchase warrants
granted to a certain creditor of ORCA. Except as set for the above and
except as granted to Seller pursuant to the terms of this Agreement, as of
the date of this Agreement, there are no shares of capital stock or other
equity securities of ORCA outstanding and no outstanding options, warrants,
scrip, rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities or rights convertible into or
exchangeable for, shares of the capital stock of ORCA or contracts,
commitments, understandings, or arrangements by which ORCA is or may be
bound to issue additional shares of its capital stock or options, warrants,
or rights to purchase or acquire any additional shares of its capital
stock. ORCA is presently negotiating with one or more entities toward
completion of transactions that may involve the issuance of shares of its
Common Stock or Preferred Stock or other instruments, including securities
which may be convertible to Common Stock. The issuance of such securities
would result in dilution of the equity interests of existing shareholders
of ORCA, including the Seller, and such dilution may be substantial,
depending upon the size and value of the transaction in which such
securities are issued.
5.3 NO VIOLATIONS; CONSENTS. The execution, delivery and performance of the
Transaction Documents and the transactions contemplated thereby by Buyer
will not conflict with, result in the breach of, or constitute a material
default under: (a) the respective articles of incorporation or bylaws of
Buyer, (b) any material contract, note, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which Buyer is a party
or by which Buyer is bound or to which its assets are subject; or (c) any
statue, order, injunction, judgement, decree, rule or regulation of any
court or regulatory authority or governmental body applicable to Buyer or
to which its assets are subject. No consent or approval by any third person
or public authority is required to authorize, or is required in connection
with, the execution, delivery or performance of this Agreement by Buyer.
5.4 THE SHARES. With the exception of the escrow conditions described in
Section 3.2, and SEC Rule 144 resale restrictions, Seller will acquire good
title to the Shares, free and clear of all pledges, security interests,
liens, charges, equities or claims, except as may be created by Seller. The
Seller (i) understand that the Shares have not been, and will not be,
registered under the Securities Act of 1933, as amended (the "Securities
Act"), or under any state securities laws, and are being offered and sold
in reliance upon federal and state exemptions for transactions not
involving any public offering, (ii) are acquiring the Shares solely for its
own account for investment purposes, and not with a view to the
distribution thereof (except to the shareholders of the Seller), (iii) are
sophisticated investors with knowledge and experience in business and
financial matters, (iv) has received certain information concerning the
Buyer and has had the opportunity to obtain additional information as
desired in order to evaluate the merits and the risks inherent in holding
the Shares, (v) is able to bear the economic risk and lack of liquidity
inherent in holding the Shares, and (vi) is an "Accredited Investor" as
that term is defined in Rule 501 of Regulation D promulgated under the
Securities Act.
5.5 BROKERS. Buyer has not entered into or authorized any arrangements with
any broker, finder, or investment banker that will result in payment of a
fee in connection with this transaction.
5.6 FILING STATUS OF BUYER. Buyer is a public company and its Common Stock is
registered as a class under the Exchange Act. Consequently, Buyer is
subject to certain reporting, disclosure and filing requirements under the
Exchange Act, including the filing of periodic reports with the SEC. Buyer
is current in its filing obligations under the Exchange Act and has filed
all reports required to be filed by Buyer thereunder for the past 12
months. To the best of its knowledge, no filing submitted by Buyer to any
federal or state agency under the Securities Act, the Exchange Act and
state securities laws during such period contains any false or misleading
statements with respect to any material fact, or omits to state any
material fact necessary in order to make the statements therein not false
or misleading, in each case at this time such filing was filed or became
effective.
5.7 ACTIONS, SUITS, ETC. Except as described in the ORCA quarterly report on
Form 10-QSB for the quarter ended September 30, 1998, a copy of which is
attached to this Agreement as "Exhibit D", there are no actions, suits,
proceedings or investigations pending or, to the best knowledge of Buyer,
threatened against or affecting Buyer at law or in equity or before any
court or any federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign
(each being hereinafter referred to as an "Agency") the objective of which
is to restrain or prohibit or obtain damages in respect to the consummation
of the purchase and sale of the Assets or the transactions contemplated
hereby or which could have a material adverse effect upon the financial
condition or business operations of Buyer or upon the ability of Buyer to
fulfill its respective obligations under this Agreement and the other
Transaction Documents to be executed by Buyer contemplated hereby.
Moreover, Buyer, to its best knowledge of ORCA or Buyer, is not in default
with respect to any order, writ, injunction or decree of any court or
Agency with respect to the consummation of the purchase and sale of the
Acquired Products or the transactions contemplated hereby.
5.8 FINANCIAL STATEMENTS. Buyer has delivered to Seller prior to the
execution of this Agreement copies of the following financial statements of
ORCA included in reports filed with the SEC (collectively referred to
herein as the "ORCA Financial Statements"): Balance sheet as of June 30,
1998, and the related statements of income, stockholder's equity and cash
flows (audited) for the years ended June 30, 1998 and 1997 (including
related notes and schedules, if any), as reported upon by its independent
certified public accountants; balance sheet (unaudited) as of September 30,
1998, and the related statements of income, stockholders' equity and cash
flows (unaudited) for the same periods. The ORCA Financial Statements (as
of the dates thereof and for the periods covered thereby): (i) are in
accordance with the books and records of ORCA, which are complete and
accurate in all material respects and which have been maintained in
accordance with good business practices, and (ii) present fairly the
financial position and results of operations of ORCA as of the dates and
for the periods indicated, in accordance with GAAP, applied on a basis
consistent with prior periods (subject in the case of interim financial
statements to normal recurring year-end audit adjustments and provided,
further, that in accordance with applicable SEC regulations governing such
interim statements exclude certain footnote and other disclosure required
by GAAP).
5.9 ABSENCE OF UNDISCLOSED LIABILITIES. Buyer has no obligation or liability
(contingent or otherwise) that is material to Buyer, or that when combined
with similar obligations or liabilities would be material to Buyer, (a)
except as disclosed in the ORCA Financial Statements or by Buyer in this
Agreement and (b) except commitments made in the ordinary course of Buyer's
business consistent with past practices. Since September 30, 1998, Buyer
has not incurred or paid any obligation or liability which would be
material to Buyer, except for obligations paid in connection with
transactions by it in the ordinary course of its business consistent with
past practices or as disclosed in the ORCA Financial Statements or in
reports filed with the SEC pursuant to its reporting obligations.
5.10 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since September 30, 1998, Buyer has
not incurred any material liability, except in the ordinary course of its
business consistent with its past practices and except as permitted
pursuant to this Agreement; suffered any material or adverse change in its
business, operations, assets or condition (financial or otherwise) which
has not been disclosed in the ORCA Financial Statements or in publicly
filed reports; or failed to operate its business consistent with its past
practices.
5.11 COMPLIANCE WITH LAW. To the best of Buyer's knowledge, it is in
compliance and has conducted its business so as to comply in all material
respects with all laws, rules and regulations, judgments, decrees or orders
of any governmental entity applicable to its business or with respect to
which compliance is a condition or engaging in its business, the breach or
violation of which would have a material adverse effect on the financial
condition of ORCA. To the best knowledge of Buyer, it has not received any
notification
or communication from any agency or department of federal, state, or
local government (a) asserting that it is not in compliance with any
of the statutes, regulations or ordinances which such governmental
authority enforces, which as a result of such non-compliance, would
result in a material adverse impact on the financial condition of
ORCA, or (b) threatening to revoke any license, franchise, permit or
governmental authorization which is material to the financial
condition of ORCA.
5.12 RELIANCE. Buyer recognizes and agrees that Seller is relying upon the
representations and warranties made by Buyer in this Agreement,
notwithstanding any investigation by Seller.
5.13 DISCLOSURE. No representation or warranty by Buyer made in this
Agreement, and no statement or certificate furnished or to be
furnished by Buyer to Seller, in connection with the transactions
contemplated hereby or by the other Transaction Documents, contains
any untrue statement of a material fact, or omits to state a material
fact necessary to make the statements contained herein or therein not
misleading.
SECTION 6
REPRESENTATIONS AND WARRANTIES OF SELLER
----------------------------------------
Seller represents and warrants to Buyer that the following are true and
correct as of the date of this Agreement.
6.1 AUTHORIZATION. Seller, Millennium, is a corporation, duly organized
and validly existing under the laws of the State of Washington. Seller
has taken all corporate action necessary to authorize, and subject to
dissenting shareholders' rights, Seller's shareholders have approved
Seller's execution and delivery of the Transaction Documents and the
performance of its obligations hereunder. Seller has full corporate
power and authority to enter into the Transaction Documents and to
carry out the terms thereof. Seller has duly executed and delivered
this Agreement, and this Agreement constitutes and other agreements
contemplated hereby to which Seller, is a party upon due execution and
delivery by Seller will constitute legal, valid, binding and
enforceable according to its respective terms, except (i) that such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or similar laws affecting creditors'
rights, and (ii) that the remedy of specific performance and
injunctive and other forms of equitable relief are subject to certain
equitable defenses and to the discretion of the court before which any
such proceedings therefore may be brought. To the best knowledge of
the Seller, no authorization, consent or approval of, or filing with,
any public body or authority is necessary to be obtained for the
consummation of the transactions
contemplated by this Agreement; subject, however, to applicable notice
requirements and the rights of dissenting shareholders, if any. No
authorization, consent or approval of any third party is necessary for the
consummation by Seller of the transactions contemplated by this Agreement.
6.2 NO VIOLATIONS. The execution, delivery and performance of this Agreement
by Seller will not conflict with, result in the breach of, or constitute a
default under (a) Seller's articles of incorporation or bylaws; (b) any
note, mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which Seller is a party or by which Seller is bound, or (c)
any statute, order, injunction, judgment, decree, rule or regulation of any
court or regulatory authority or governmental body applicable to Seller.
6.3 FINANCIAL STATEMENTS. Seller has furnished to Buyer, complete and accurate
copies of (a) Seller's interim financial statements dated January 31, 1998,
and (b) Seller's financial statements for the fiscal years ended October
31, 1996 and 1997 (collectively, the "Seller's Financial Statements"). The
Seller's Financial Statements (i) have been prepared in accordance with
GAAP applied on a consistent basis throughout the periods specified, and
(ii) fairly present the financial condition of Seller as of the dates
specified and the results of its operations for the periods specified,
subject, in the case of the interim statements, to normal year-end
adjustments of a nonrecurring nature.
6.4 MATERIAL ADVERSE CHANGES. There has been no material adverse change to
Seller, the Assets or Business since the date of the most recent of the
Seller's Financial Statements.
6.5 TAXES. Seller have timely paid all Taxes that have become due and payable.
Seller has timely filed all required returns and reports with respect to
such Taxes. Seller has not waived any statute of limitations relating to
Taxes. The charges, accruals and reserves shown in the Seller's Financial
Statements are adequate to cover all Taxes currently due and payable,
except to the extent disclosed in notes to the balance sheet. Seller is not
subject to any dispute regarding Taxes. No federal, state or local audits
or administrative court proceedings are presently pending or threatened
with regard to any Taxes.
6.6 ABSENCE OF INDEBTEDNESS AND OTHER OBLIGATIONS. Except as set forth in
Seller's Financial Statements, (a) Seller has no Indebtedness (as defined
below) of a material nature, and (b) Seller has, to the best of its
knowledge, no other obligations of a material nature, whether accrued,
absolute, contingent or otherwise (including without limitation liabilities
as a surety or guarantor) and whether due or to become due, including
without limitation any liabilities for Taxes. "Indebtedness", means (i) all
indebtedness of Seller for borrowed money or for the deferred purchase
price of property or services,
including without limitation any indebtedness of Seller with respect to any
shareholder of Seller, and (ii) any other indebtedness of Seller which is
evidenced by a note, bond, debenture or similar instrument.
6.7 INTELLECTUAL PROPERTY RIGHTS. Seller owns, or has the right to use and
transfer ownership of the Products (whether patentable or unpatentable and
whether or not reduced to practice), all improvements thereto, and all
patents, patent applications, and patent disclosures, together with all
reissuances, continuations, continuations-in-part, revisions, extensions,
and reexaminations thereof, (b) all trademarks, service marks, trade dress,
logos, trade names, and corporate names, together with all translations,
adaptations, derivations, and combinations thereof and including all
goodwill associated therewith, and all applications, registrations, and
renewals in connection therewith, (c) all copyrightable works, all
copyrights, and all applications, registrations, and renewals in connection
therewith, (d) all mask works and all applications, registrations, and
renewals in connection therewith, (e) all trade secrets and confidential
business information (including ideas, research and development, know-how,
formulas, compositions, manufacturing and production processes and
techniques, technical data, designs, drawings, specifications, customer and
supplier lists, pricing and cost information, and business and marketing
plans and proposals), (f) all computer software (including data and related
documentation), (g) all other proprietary rights, and (h) all copies and
tangible embodiments thereof (in whatever form or medium) (the "Acquired
Intellectual Property"), to Buyer, free and clear of any liabilities,
claims, liens, licenses, or other encumbrances of any kind. To the best
knowledge of Seller, Seller's use of the Acquired Intellectual Property has
not conflicted with or infringed, and no one has asserted that such use
conflicts with or infringes, upon any proprietary rights owned, possessed
or used by any third party. Seller has not received notice of any claims,
disputes, actions, proceedings, suits or appeals pending with respect to
any of the Acquired Intellectual Property, to be purchased by Buyer, and
none has been threatened. Each item of Acquired Intellectual Property owned
or used by any of the Seller immediately prior to the Closing hereunder
will be owned or available for use by the Buyer on identical terms and
conditions immediately subsequent to the Closing hereunder.
6.8 SOLE OWNER. Seller is the sole owner of the Products and the Acquired
Intellectual Property, and they are aware of no claim by any other party,
parties or entity to an interest in said Products and the Acquired
Intellectual Property.
6.9 LITIGATION. Seller is aware of no material action dispute or claim
proceeding, suit, appeal or investigation pending or threatened against
Seller that involves the Products to be purchased, the Acquired
Intellectual Property or that questions the validity of this Agreement. To
Seller's knowledge, there are no facts that could reasonable be expected to
result in a judgment or other determination that would have a material
adverse effect on Seller, the Products or the Acquired Intellectual
Property or that would cause this Agreement to be
prohibited or enjoined. For purposes of this Section 6, "material claim"
means any claim exceeding $5,000, or any group of similar claims exceeding
$10,000, exclusive of interest and attorney fees. Seller is not currently a
party to any lawsuit with respect to any other party or entity.
6.10 BROKERS. Seller has not entered into or authorized any arrangements with
any broker, finder, or investment banker that will result in payment of a
fee in connection with this transaction.
6.11 RELIANCE. Seller recognizes and agrees that Buyer relying upon the
representations and warranties made by Seller, in this Agreement,
notwithstanding any investigation by Buyer.
6.12 DISCLOSURE. To the best of Seller's knowledge, no representation or
warranty by Seller made in this Agreement, and no statement or certificate
furnished or to be furnished by Seller to Buyer in connection with the
transactions contemplated hereby, contains any untrue statement of a
material fact, or omits to state a material fact necessary to make the
statements contained herein or therein not misleading.
6.13 NO RESTRICTIVE COVENANTS. Seller is not a party to any agreement,
contract or covenant limiting the freedom of Seller to compete in any line
of business or with any person or other entity in any geographic area,
while utilizing the Products to be purchased as a result of this Agreement.
SECTION 7
COVENANTS AND CONDITIONS TO OBLIGATION TO CLOSE
-----------------------------------------------
7.1 PRE-CLOSING COVENANTS. The Parties agree as follows with respect to the
period between the execution of this Agreement and the Closing.
7.1.1 General. Each of the Parties will use its reasonable best efforts
-------
to take all action and to do all things necessary in order to
consummate and make effective the transactions contemplated by this
Agreement (including satisfaction, but not waiver, of the closing
conditions set forth in Sections 7.2 and 7.3 below.
7.1.2 Notices and Consents. Seller will give any notices to third
--------------------
parties, and Seller will use its reasonable best efforts to obtain
any third party consents, that Buyer reasonably may request in
connection with the matters referred to in Section 6 above. Each of
the Parties will give any notices to, make any filings with, and use
its reasonable best efforts to obtain any authorizations, consents,
and approvals of governments and governmental agencies in connection
with the matters referred to in Section 5.1 and Section 6.1 above.
7.1.3 Preservation of Business. Seller will keep its Products, Acquired
------------------------
Intellectual Property, Products-related business and properties
substantially intact, including its present operations, physical
facilities, working conditions, and relationships with lessors,
licensors, suppliers, customers, and employees.
7.1.4 Exclusivity. Seller will not (i) solicit, initiate, or encourage
-----------
the submission of any proposal or offer from any person or entity
relating to the acquisition of any capital stock or other voting
securities, or any substantial portion of the assets, of Seller
(including any acquisition structured as a merger, consolidation, or
share exchange) or (ii) participate in any discussions or
negotiations regarding, furnish any information with respect to,
assist or participate in, or facilitate in any other manner any
effort or attempt by any person or entity to do or seek any of the
foregoing.
7.2 CONDITIONS TO OBLIGATION OF BUYER. The obligation of Buyer to consummate
the transactions to be performed by it in connection with the Closing is
subject to satisfaction of the following conditions:
7.2.1 The representations and warranties set forth in Section 6 above
shall be true and correct in all material respects at and as of the
Closing Date.
Seller and Xxxxx shall have performed and complied with all of their
respective covenants hereunder in all material respects through the
Closing.
No action, suit, or proceeding shall be pending before any court or quasi-
judicial or administrative agency of any federal, state, local, or foreign
jurisdiction or before any arbitrator wherein an unfavorable injunction,
judgment, order, decree, ruling, or charge would (A) prevent consummation of any
of the transactions contemplated by this Agreement, (B) cause any of the
transactions contemplated by this Agreement to be rescinded following
consummation, or (C) affect adversely the right of Buyer to own the Acquired
Assets.
Buyer shall have entered into an employment agreement with Xxxxx; Buyer may
waive any condition specified in this Section 6(a) if it executes writing
so stating at or prior to the Closing.
7.3 CONDITIONS TO OBLIGATION OF SELLER. The obligation of Seller to consummate
the transactions to be performed by it in connection with the Closing is
subject to satisfaction of the following conditions:
7.3.1 the representations and warranties set forth in Section 5 above shall
be true and correct in all material respects at and as of the Closing
Date;
7.3.2 no action, suit, or proceeding shall be pending before any court or
quasi-judicial or administrative agency of any federal, state, local,
or foreign jurisdiction or before any arbitrator wherein an
unfavorable injunction, judgment, order, decree, ruling, or charge
would (A) prevent consummation of any of the transactions
contemplated by this Agreement or (B) cause any of the transactions
contemplated by this Agreement to be rescinded following consummation
(and no such injunction, judgment, order, decree, ruling, or charge
shall be in effect);
Seller may waive any condition specified in this Section 6(b) if it
executes a writing so stating at or prior to the Closing.
SECTION 8
FURTHER AGREEMENTS
------------------
8.1 SECURITIES ISSUES. The Shares will not be registered under the Securities
Act or pursuant to the blue-sky laws of any state, and will be issued by
ORCA in reliance upon exemptions under the Securities Act. Because the
offer and sale of the shares will not be registered under the Securities
Act, the Shares cannot be resold unless they are registered under the
Securities Act or unless the holder first receives an opinion of securities
counsel, reasonably acceptable to the Company, that an exemption from
registration is available for such transaction. With regard to the
restrictions on resale of the Shares, Seller is aware (i) of the
limitations and potential applicability of the SEC Rule 144; (ii) that ORCA
will issue stop transfer orders to its stock transfer agent in the event of
attempts to improperly transfer any such securities; and (iii) that a
restrictive legend will be placed on any certificate representing the
shares, which legend will read substantially as follows:
"The Shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended (The
"Act"), and are "restricted securities" as that term is defined
in Rule 144 under the Act. The shares may not be offered for
sale, sold or otherwise transferred except pursuant to an
effective registration statement under the Act or pursuant to an
exemption from registration under the Act, the availability of
which is to be established to the satisfaction of the Company."
8.2 NEWS RELEASE. Buyer may make news releases and announcements concerning
this transaction and the actions contemplated by this Agreement.
8.3 CONFIDENTIALITY. No information concerning one party that has been
furnished to or obtained by the other party in connection with this
Agreement may
be disclosed to any person other than in confidence to employees, legal
counsel, financial advisers or independent public accountants who
reasonably need to now such information in connection with the transactions
contemplated by this Agreement and who agree to be bound by this Section.
Notwithstanding the foregoing, this obligation shall not apply to
information that (a) is, or becomes, publicly available from a source other
than the other party; or its employees, legal counsel, financial advisors,
independent public accountants or other agents; (b) was known and can be
shown to have been known by the other party at the time of its receipt; (c)
is received by the other party from a third party without breach of this
Agreement; (d) is required by law or court order to be disclosed; provided
that the party from whom disclosure is sought, gives the other party prompt
written notice of such law or court order before making such disclosure; or
(e) is disclosed in accordance with the written consent of the other party.
8.4 COVENANTS NOT TO COMPETE OR SOLICIT.
8.4.1 Non-Competition Covenant. Seller's will not, without the prior
-------------------------
written consent of Buyer, for a period of three years following the
date hereof, directly or indirectly engage in, or have any interest
in any corporation, partnership or other enterprise that engages in,
any Competitive Activity in North America. "Competitive Activity"
means the ownership, operation or management of a business engaged
in services or the development, marketing and sale of products that
directly compete with those marketed by the Buyer's Business or
those otherwise provided by Buyer or any of its affiliates.
Competitive Activity does not include the ownership by Seller of
equity securities in any publicly traded corporation that does not
exceed 5% of the outstanding capital stock of such corporation.
8.4.2 Non-Solicitation Covenant. Seller covenants and agrees that for a
--------------------------
period of three years following the date hereof, they shall not,
directly or indirectly, for their benefit or for the benefit or any
other person, with respect to the Business as conducted by Buyer (a)
solicit any such business from any customer or supplier of Buyer,
(b) induce or cause any customer to cease purchasing any service or
product from Buyer or to terminate or change such customer's
business relationship with Buyer in any manner, (c) induce or cause
any supplier to cease providing or selling any service or product to
Buyer or to terminate or change such supplier's business
relationship with Buyer in any manner, or (d) induce or solicit any
person who is then employed by Buyer to leave such employment or
other position with Buyer or to accept any other employment
position.
8.4.3 Reasonableness. Seller acknowledges that the covenants set forth in
---------------
this agreement (a) do not impose unreasonable restrictions or work a
hardship on them, (b) are necessary and fundamental to the
protection
of the Business to be conducted by Buyer, (c) are reasonable as to
scope, duration, and territory, (d) are given as a condition to
Buyer entering into this Agreement, (e) are necessary to preserve
the value of the products purchased, and (f) are for the purpose of
restricting the activities of Seller only to the extent necessary
for the protection of the legitimate business interests of Buyer.
Seller agrees that such covenants are reasonable and do not and will
not impose an undue hardship on them.
8.4.4 Equitable Relief. Seller acknowledges and agrees (a) that any
-----------------
damages sustained by the Buyer as a result of a breach of this
agreement cannot be adequately remedied by damages, and (b) that
Buyer, notwithstanding any other provision of this Agreement, and in
addition to any other remedy it may have under this Agreement or at
law, shall be entitled to injunctive and other equitable relief to
prevent or curtail any breach of any provision of this agreement.
8.5 AUDITS. Seller shall permit the audit and other examination by Buyer or
its independent public accounting firm of Seller's financial statements for
the three most recent fiscal years, and interim periods or such shorter
periods as may be permitted under applicable SEC rules and regulations
relating to material acquisitions by reporting companies. ORCA will pay the
fees of its auditors in connection with such audit and examination.
SECTION 9
CLOSING COSTS
-------------
9.1 CLOSING COSTS. Buyer and Seller agree to pay their own respective
closing costs incurred through the finalization of this transaction.
9.2 OTHER COSTS, EXPENSES AND PROFESSIONAL FEES. Except as provided
otherwise in this Agreement, the parties each agree to bear their own costs
and expenses, including without limitation all fees of attorneys,
accountants, brokers and other service providers incurred in connection
with the negotiation and preparation of this Agreement, and with any due
diligence conducted, and documents required to be executed, in connection
with this Agreement.
SECTION 10
SURVIVAL; INDEMNIFICATION
-------------------------
10.1 SURVIVAL. The representations, warranties, covenants and agreements of the
parties contained in this Agreement or any other Transaction Document delivered
in accordance with this Agreement shall survive the execution and delivery of
this Agreement, any investigation by or on behalf of any party, and the
consummation of the transactions contemplated hereby.
10.2 INDEMNIFICATIONS BY SELLER
10.2.1 Indemnification. Seller shall indemnify Buyers and hold them
harmless from and against all losses, costs, expenses, damages or
liabilities, including reasonable attorney fees (collectively, "Damages")
incurred by Buyer as the result of or in connection with: (a) any breach or
inaccuracy of any representation or warranty or Seller made in the
Transaction Documents; (b) any failure by Seller to fulfill any of their
respective covenants or other agreements contained in the Transaction
Documents; (c) any liability or obligation of Seller to any third party not
expressly assumed by Buyer in accordance with the terms of this Agreement.
10.3 INDEMNIFICATION BY BUYER. Buyer will indemnify Seller, and hold them
harmless from and against all Damages incurred by Seller by reason of or arising
out of or in connection with (a) any breach or inaccuracy of any representation
or warranty of Buyer or ORCA made in the Transaction Documents, and (b) any
failure by Buyer to fulfill any of Buyer's covenants or other agreement
contained in the Transaction Documents.
10.4 INDEMNIFICATION PERIOD. Except as otherwise specified in this Agreement,
no claim for indemnity will be effective if not made within 12 months after the
date hereof (the "Indemnification Period"). Claims based upon the assertion that
a party had actual knowledge that a representation or warranty made by such
party was materially false when made or was made with the intent to deceive,
claims arising under the employment agreement and claims based on Sections 6,
may be made at any time up to expiration of the applicable statute of
limitations.
10.5 LIMITATIONS ON INDEMNIFICATION. Notwithstanding anything to the contrary
contained in this Agreement, the obligations of Buyer and Seller ("Indemnifying
Parties"), as defined below in Section 10.6.1, to provide indemnification under
this Agreement shall be subject to the following limitations:
10.5.1 Indemnifying Parties shall not have any liability, nor be subject
to any claim under this Agreement, with respect to any Damages
unless the amount of Damages exceeds $50,000. (The "Basket Amount")
in the aggregate, whereupon the claiming Indemnified Party shall be
entitled to receive indemnity payments for the amount of damages
that exceeds the Basket Amount.
10.5.2 The aggregate amount which may be recovered from Indemnifying
Parties in respect of any claim and all claims made pursuant to
this
Agreement, whether by setoff, counterclaim or otherwise, shall
not exceed such Indemnifying Party's respective pro rata interest
in the Fair Market Value of the Shares or cash received in payment
of the Purchase Price, with said shares being valued as of the date
of this Agreement. For purposes of this Agreement, Fair Market
Value shall mean the average of the closing bid prices of the
Company's Common Stock for the five trading days immediately
proceeding the date of this Agreement.
10.5.3 Indemnifying Parties shall not have any liability, or be subject to
any claim under this Agreement, with respect to any inaccuracy in
or incompleteness of or any breach of any representation, warranty,
covenant or agreement contained in this Agreement if they shall
have delivered written notice detailing such inaccuracy,
incompleteness or breach to Buyer prior to the date hereof, Buyer
shall actually have received such notices and Buyer shall have
elected to proceed with the execution of the transactions
contemplated hereunder notwithstanding such inaccuracy,
incompleteness or breach.
10.5.4 At Seller's option, they may pay any amounts due Buyer (including
indemnities to third parties) under this Agreement by delivering
Shares to Buyer. In such event, the value of each Share so
delivered shall be deemed to be equal to the Fair Market Value of
such Share on the date hereof computed as provided in Section
10.3.2, above.
10.6 MATTERS INVOLVING THIRD PARTIES:
10.6.1 If any third party shall notify any party (the "Indemnified Party")
with respect to any matter (a "Third Party Claim") which may give
rise to a claim for indemnification against the other Party (the
"Indemnifying Party") under this Section 10, then the Indemnified
Party shall promptly notify the Indemnifying Party thereof in
writing; provided, however, that no delay on the part of the
Indemnified Party in notifying the Indemnifying Party shall relieve
the Indemnifying Party from any obligation hereunder unless (and
then solely to the extent) the Indemnifying Party thereby is
prejudiced.
10.6.2 The Indemnifying Party will have the right to defend the
Indemnified Party against the Third Party Claim with counsel of its
choice reasonably satisfactory to the Indemnified Party so long as
(A) the Indemnifying Party notifies the Indemnified Party in
writing within fifteen (15) days after the Indemnified Party has
given notice of the Third Party Claim that the Indemnifying Party
will indemnify the Indemnified Party from and against the entirety
of any Adverse Consequences the Indemnified Party may suffer
resulting from, arising out of, relating to, in the nature of, or
caused by the Third Party Claim, (B) the Indemnifying Party
provides the Indemnified Party with evidence reasonably acceptable
to the Indemnified Party that the Indemnifying Party will have the
financial resources to defend against the Third Party Claim and
fulfill its indemnification obligations hereunder, (C) the Third
Party Claim involves only
money damages and does not seek an injunction or other equitable
relief, (D) settlement of, or an adverse judgment with respect to,
the Third Party Claim is not, in the good faith judgment of the
Indemnified Party, likely to establish a precedential custom or
practice materially adverse to the continuing business interests of
the Indemnified Party, and (E) the Indemnifying Party conducts the
defense of the Third Party Claim actively and diligently.
10.6.3 So long as the Indemnifying Party is conducting the defense of the
Third Party Claim in accordance with Section 9.6.2 above, (A) the
Indemnified Party may retain separate co-counsel at its sole cost
and expense and participate in the defense of the Third Party
Claim, (B) the Indemnified Party will not consent to the entry of
any judgment or enter into any settlement with respect to the Third
Party Claim without the prior written consent of the Indemnifying
Party (not to be withheld unreasonably), and (C) the Indemnifying
Party will not consent to the entry of any judgment or enter into
any settlement with respect to the Third Party Claim without the
prior written consent of the Indemnified Party (not to be withheld
unreasonably).
10.6.4 In the event any of the conditions in Section 9.6.3 above is or
becomes unsatisfied, however, (A) the Indemnified Party may defend
against, and consent to the entry of any judgment or enter into any
settlement with respect to, the Third Party Claim in any manner it
reasonably may deem appropriate (and the Indemnified Party need not
consult with, or obtain any consent from, the Indemnifying Party in
connection therewith), (B) the Indemnifying Party will reimburse
the Indemnified Party promptly and periodically for the costs of
defending against the Third Party Claim (including attorneys' fees
and expenses), and (C) the Indemnifying Party will remain
responsible for any Adverse Consequences the Indemnified Party may
suffer resulting from, arising out of, relating to, in the nature
of, or caused by the Third Party Claim to the fullest extent
provided in this Section 9
10.7 Other Indemnification Provisions. The foregoing indemnification provisions
are in addition to, and not in derogation of, any statutory, equitable, or
common law remedy any Party may have for breach of representation,
warranty, or covenant
SECTION 11
OTHER PROVISIONS
----------------
10.1 ASSIGNMENT, BENEFIT. No party may voluntarily or involuntarily assign its
interest under this Agreement without the prior written consent of the
other party, which shall not be unreasonably withheld. Subject to the
foregoing, this Agreement shall be binding upon and shall inure to the
benefit of the parties and their respective successors and assigns.
10.2 AMENDMENT, WAIVER. The provisions of this Agreement, or of any agreement
or document executed in connection with this Agreement, may be
amended or waived only in writing by the party against which enforcement
of such amendment or waiver is sought.
10.3 SEVERABILITY. If any portion of this Agreement is held to be invalid
by a court of competent jurisdiction, the remaining terms of this
Agreement shall remain in full force and effect to the extent possible.
10.4 GOVERNING LAW. The construction and performance of this Agreement will be
governed by the laws of the State of Washington (except for the choice of
law provisions thereof).
10.5 INDEPENDENT COUNSEL. Seller, Millennium and Xxxxx acknowledge that they
have been represented by independent legal counsel with regard to this
Agreement, and have had an adequate opportunity to seek independent legal
counsel with regard to all documents executed in connection with this
Agreement.
10.6 NOTICES. The parties shall deliver any notices required under this
Agreement in writing by personal or courier delivery, facsimile
transmission, or by registered or certified U.S. mail, return receipt
requested, postage prepaid, to the addresses set forth below, or to such
other address as specified by a party in writing. Notices shall be deemed
effective as of the date of personal or courier delivery confirmed
facsimile transmission, or the date of receipt.
If to Buyer: With a copy to:
ORCA TECHNOLOGIES, INC. Van Valkenberg Xxxxxx Group
00000 00xx Xxxxxx, XX, Xxxxx 000 0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000 Xxxxxxx, Xxxxxxxxxx 00000-0000
Facsimile: (000) 000-0000 Facsimile: (000) 000-0000
Attention: President Attention: Xxxxxxx Xxxxxx, Esq.
If to Seller: With a copy to:
Millennium Software, Inc. Xxxxxx Xxxxxxxxxx, Esq.
C/o Xx. Xxxx Xxxxx
22618 N.E. 15th Place Bellevue, Washington
Xxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000 Facsimile: (000) 000-0000
10.7 ATTORNEY FEES. The prevailing party in any arbitration or litigation
concerning this Agreement is entitled to reimbursement of its reasonable
attorney fees and expenses from the non-prevailing party, including costs
and expenses incurred on appeal or in bankruptcy proceedings.
10.8 ENTIRE AGREEMENT. This Agreement, its attached schedules and exhibits,
and the Transaction Documents contain the entire agreement of the parties,
and supersede any and all prior agreements, written or oral, relating to
their subject matter.
10.9 COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which will be deemed an original but all of which together will
constitute the same instrument.
EXECUTED AS OF THE FIRST DATE WRITTEN ABOVE:
BUYER: ORCA TECHNOLOGIES, INC.
BY: /s/ Xxxxx X. Xxxxx
--------------------
Xxxxx X. Xxxxx
ITS: President and Chairman
SELLER: MILLENNIUM SOFTWARE, INC.
BY: /s/ Xxxx Xxxxx
--------------------
Xxxx Xxxxx
ITS: President and Chairman
XXXXX: XXXX XXXXX
BY: /s/ Xxxx Xxxxx
--------------------
Individually
EXHIBIT A
---------
Summary Description of Millennium Software Products
---------------------------------------------------
DISPATCH
The DISPATCH product provides a solution for PowerBuilder applications that want
to enable distributed processing of PowerBuilder reports in particular, and
other types of processes as well. Through DISPATCH, these processes can be
scheduled to run on a particular server and at specified times. The output
location and or printing of reports and other processes can be managed through
DISPATCH as well. DISPATCH is designed to provide users an environment where
they can manage, execute and view reports and other supported tasks (e.g.,
executables, database stored procedures and packages). A Package is a special
type of task that contains one or more other tasks. Packages enable users to
schedule multiple tasks to run in a particular sequence and/or order of
dependence. Packages can also include other Packages, thus providing a method of
nesting multiple levels of tasks. DISPATCH uses a database repository for
storing information required to run the tasks and enforce permissions. The
DISPATCH system is made up of several modules that perform specific functions.
1. Dispatcher
2. Task Manager
3. Administrator
4. DeskTop
Dispatcher
The Dispatcher is a Server Application that monitors what tasks may be scheduled
to be run. Once a task is found to be ready to be run, the Dispatcher assigns
the task to a specific Task Manger for processing.
Task Manager
Task Managers are Server Applications that can run on any number of systems and
one or more instances on each server. The Task Manager is the server that
actually processes a task such as running a report. The more task managers there
are running, the more simultaneous processes the system can handle.
Administrator
The Administrator is a front-end application that manages data in the DISPATCH
repository. Using the Administrator, users can manage groups, users, tasks,
servers and many other aspects of the DISPATCH system.
DeskTop
The DeskTop is a front-end application intended for use by end-users of the
DISPATCH system. The DeskTop limits the tasks available to the user based on the
permissions granted to the user. From the DeskTop a user can manage their own
tasks, select tasks for execution and view output.
SENTRY
The Sentry system is an Application Security System for PowerBuilder
applications. The product uses a data driven repository of application security
constraints that can be used by multiple PowerBuilder applications and multiple
sets of users. The repository of security information is stored in the Sentry
database. The Sentry product provides an administrative application that manages
information stored in the Sentry database. By using the Sentry Administrator,
authorized users can manage security for Applications, Users, Groups, Functions
and Data Base Connections. Sentry also provides a PowerBuilder library that is
intended to be included with existing PowerBuilder applications that want to add
Sentry's security functionality. This library provides a security object that
can manage secured logins to applications based on information in the Sentry
Database. Once a connection has been made, the security object will then
retrieve all of the security rules for the application's user and store them in
the Security object during the user's session. The security object provides
methods for developers to query the security object regarding specific
permissions on various application functions. In this way, developers can
programmatically determine how the application should function based on Sentry's
repository of security functions.
EXHIBIT E
SOFTWARE DEVELOPMENT
CONTRACT AGREEMENT
BETWEEN
Millennium Software, Inc.
and
Orca Technologies, Inc.
AGREEMENT
---------
This Agreement is between Millennium Software, Inc. and Orca Technologies,
Inc. ("the parties") for the software development services of Xxxxxxx Xxxxxxxx
(herein referred to as the "DISPATCH Developer").
1 SOFTWARE DEVELOPER PROVIDED BY Millennium Software, Inc.: Millennium
Software, Inc. will provide the software development services of the DISPATCH
Developer who is knowledgeable in the design and implementation of the
DISPATCH software product.
2 ENGAGEMENT OF PROGRAMMING SERVICES RENDERED: The programming services of the
DISPATCH Developer will be for a period of no less than six months beginning
January 15, 1999 and ending July 15, 1999. The hours worked by the DISPATCH
Developer will average no less than a normal 40-hour work week during normal
work hours and on normal business work days unless otherwise arranged between
the parties. The work performed by the DISPATCH Developer will be at the
direction of Orca Technologies, Inc.. The DISPATCH Developer will not work
more than 40 hours per week or on non-business days unless authorized by Orca
Technologies, Inc.
3 SOFTWARE DEVELOPER PROVIDED BY Millennium Software, Inc. Millennium Software,
Inc. will provide the software development services of Xxxx Xxxxxxxx who is
knowledgeable in the design and implementation of the DISPATCH software
product.
4 WORK PRODUCTS: The DISPATCH Developer will make available to Orca
Technologies, Inc. any documents, notebooks, source code and any other work
product produced while performing work for Orca Technologies, Inc.. Orca
Technologies, Inc. is the sole owner of any work products produced by the
DISPATCH Developer while performing work for Orca Technologies, Inc.
5 TERMS OF SERVICES RENDERED: The DISPATCH Developer will work at an hourly
rate of $75 per hour. Millennium Software, Inc. will xxxx Orca Technologies,
Inc. semi-monthly on the 1st and 15th for the period just prior to the xxxx
date. Payment terms will be Net 15. A report of the DISPATCH Developer's
hours will be included with the invoice for review by Orca Technologies,
Inc..
6 END OF CONTRACT TERMS: Prior to the end of this six month contract, Orca
Technologies, Inc. has the opportunity to 1) extend the contract period, 2)
discontinue the services of the developer, or 3) make an employment offer to
the DISPATCH developer. Orca Technologies, Inc. should provide at least 30
days notice prior to the end of this agreement (June 15, 1999) as to their
intentions for one of these three options. After June 15, 1999, if no
employment offer has been made by Orca Technologies, Inc. for the services of
the DISPATCH developer, Millennium Software, Inc. may assign the developer to
other work or the developer may seek employment elsewhere.
