SOFTWARE LICENSE AGREEMENT
This Software License Agreement (the "Agreement") is entered into as of
March 16, 2000 by and between QueryObject Systems Corporation, a Delaware
corporation ("QOS"), and
internetQueryObject Corporation, a Delaware corporation ("IQO"), each with
offices at Xxx Xxxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxx Xxxxxxx, Xxx Xxxx 00000.
WHEREAS, the parties desire that IQO acquire from QOS the exclusive
right to distribute Software for applications related to the management and
analysis of data derived from Internet commerce and Internet system management
applications, and applications pertaining to the publication and/or distribution
and/or access to such analytical data over the Internet, on the terms and
conditions set forth herein.
NOW, THEREFORE, the parties agree:
1. DEFINITIONS
1.1 "Adjusted Net Sales". Adjusted Net Sales shall mean the invoiced
amount of Software sold by IQO, less returns, charges for customs duty, freight
and sales taxes, if any, less any applicable reseller discount percentage and
less any applicable third party royalties that are payable by either IQO or QOS.
For purposes of calculating Adjusted Net Sales, all sales are to be calculated
at the then-current list price for the Software, or for Software service bureau
use, at the time the order for such Software or service is received.
1.2 "Confidential Information". Confidential Information shall have the
meaning specified therefor in Paragraph 12.1 below.
1.3 "Documentation". Documentation shall mean the materials supplied by
QOS to End Users of the Software.
1.4 "End User". End User shall mean a person or entity that acquires
the Software and Documentation only for its internal data processing
requirements and not for further distribution.
1.5 "License Term". License Term shall mean a period of five (5) years,
unless earlier terminated as set forth herein.
1.6 "Notice Address". Notice Address shall mean the address set forth
for the parties at the beginning of this Agreement, or such other addresses as a
party may hereafter designate to the other party in writing from time to time
pursuant to Section 14.8 hereof.
1.7 "Percentage Royalties". Percentage Royalties shall have the
definition set forth in Section 4.1 hereof.
1.8 "QOS Trademarks". QOS Trademarks shall have the meaning set forth
in Section 6.1 hereof.
1.9 "Quarterly Report". Quarterly Report shall have the meaning set
forth in Section 5.1 hereof.
1.10 "Security Interest". Security Interest shall have the meaning set
forth in Section 2.1(c) hereof.
1.11 "Software". Software shall mean the Software set forth in Exhibit
A attached hereto and shall include all Updates (as defined below) supplied by
QOS hereunder, and shall also include IQO Server, a product under development,
when released.
1.12 "Software Copy". Software Copy shall mean a copy of the Software
and/or Documentation ordered or acquired by IQO from QOS for distribution
pursuant to this Agreement.
1.13 "Update and Upgrade". Update to Software shall mean any
correction, update or other Software modification or addition that provides for
the correction or removal of program defects and minor modifications that do not
substantially change the basic character or structure of the Software or its
functional use or operation. Update shall exclude Upgrades and other
improvements of program features that change the basic character or structure of
the Software or its functional use or operation. An Update normally is
accompanied by a change in the product version number of the tenths digit or
less (e.g. a change from 1.00 to 1.01 or to 1.10).
Upgrade shall mean improvements of program features that change the
basic character or structure of the Software or its functional use or operation.
An Upgrade is normally accompanied by a change in the product version greater
than the tenths digit (e.g. a change from 1.0 to 2.0).
1.14 "Work". Work shall mean any advertising, promotional or other
materials related to the Software or the Documentation, or any item or process
related thereto which can be copyrighted.
2. LICENSE GRANT
2.1 License. Subject to the terms, conditions, and restrictions of this
Agreement, QOS hereby grants to IQO:
a. an exclusive license for the License Term to distribute
copies of Software on a world-wide basis to organizations and or individuals
whose primary purpose is electronic commerce over the Internet, to electronic
commerce branches, divisions or subsidiaries of companies with this primary
purpose, and to software developers, manufacturers or systems integrators whose
primary purpose is to provide management assistance to the electronic commerce
industry, for use in or integration with applications related to the management
and analysis of data derived from
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Internet commerce and Internet management applications, and applications related
to the publication and/or distribution and/or access of such analytical data
over the Internet.
b. IQO shall have the right to reproduce the Software or
Documentation, and to use, license, distribute, and/or use in a service bureau
capacity the Software and Documentation. IQO shall not modify or alter any
Software Copy in any fashion. IQO shall not purchase the Software from any party
(including its subsidiaries, affiliates or parent) other than QOS.
c. As a condition to granting this license, QOS hereby
reserves for itself a direct, continuing and first priority security interest
("Security Interest") in the license granted hereunder and all of the Software,
Documentation, Work, Software Copies, and QOS Trademarks licensed hereunder, as
well as all of the proceeds thereof, including but not limited to any Percentage
Royalties, wherever located.
This Security Interest secures all obligations, liabilities,
debts and indebtedness of any kind, nature or character owed by, or for the
benefit of, IQO to QOS, including, but not limited to, all obligations and
liabilities arising in connection with the license granted hereunder and the
payment of the Percentage Royalties (as further described below) made from time
to time by IQO in favor of QOS.
IQO hereby authorizes QOS, at IQO's expense, to file such
financing statement or statements relating to the subject matter of the Security
Interest without IQO's signature thereon as QOS, at its option, may deem
appropriate. IQO hereby appoints QOS as IQO's attorney-in-fact, authorizing QOS
to execute any such financing statement or statements in IQO's name and to
perform all other acts that QOS deems appropriate to perfect and continue the
Security Interest and to protect, preserve and realize upon the subject matter
of the Security Interest in compliance with and subject to applicable law. A
carbon, photographic or other reproduction of this Agreement or of a financing
statement shall be sufficient as a financing statement.
2.2 End User Licensing. IQO agrees to distribute the Software and
Documentation to End Users pursuant to an end user agreement in form and
substance approved in writing by QOS. Unless and until QOS provides Software
with shrink-wrap, on-line, or other self-executing End User licenses, which QOS
shall have no obligation to do, IQO shall cause each prospective End User to
execute an End User license agreement, which shall contain conditions expressly
accepted in writing by QOS, prior to delivering Software or Documentation to
that End User and IQO shall retain such signed agreement for the term of the
Agreement between IQO and the End User and for three (3) years after the
termination or expiration thereof.
2.3 Distribution; Territory. Subject to the terms and conditions of
this Agreement, IQO shall be entitled to distribute Software directly to End
Users, as well as to use distributors and other third party intermediaries,
throughout the World.
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2.4 No Rights to Source Code. Except as otherwise set forth below, IQO
shall have no rights with respect to any Software source code, and agrees not to
reverse engineer the Software or to reverse assemble, de-compile, or otherwise
attempt to derive the source code from the Software provided to IQO by QOS. IQO
is hereby granted the right to modify or otherwise prepare derivative works of
the Software or Documentation. All such modifications or derivative works, if
any, shall be the sole and exclusive property of QOS. All such derivative works
shall be works made for hire, and be the property of QOS from inception. In the
event any such derivative work is held not to be a work made for hire, IQO
hereby assigns all of its right, title and interest in and to such derivative
work to QOS. IQO agrees that it will execute such documents as may be requested
by QOS to give effect to the provisions of this paragraph.
2.5 Ownership. Subject only to the limited rights and licenses
expressly granted to IQO in this Agreement, QOS shall retain and own all right,
title, and interest in the Software, Documentation and Work, and each copy
thereof, and all intellectual property rights with respect thereto. IQO shall
place a copyright notice on each and every copy of Software, Documentation and
Work that identifies the copyright owner as QOS and states the date of first
publication of the Software, Documentation or Work. IQO shall not alter, remove
or obscure any copyright or other proprietary notices on or in the Software,
Documentation or Work. Whenever requested by QOS, whether during the License
Term hereof or thereafter, IQO shall execute such documents or applications as
QOS may deem necessary or appropriate to confirm QOS's ownership of all rights
in and to the Software, including, without limitation, in the trademarks and
copyrights licensed hereunder. All rights not expressly granted to IQO herein
are retained by QOS.
2.6 Reservation of Certain Rights. QOS reserves the right to change the
design and/or specifications of the Software at any time without liability to
QOS upon sixty (60) days prior written notice to IQO.
2.7 Escrow of Software. The Software, including, without limitation,
all source code, and all Updates and Upgrades thereof or thereto, shall be
placed in escrow by QOS within thirty (30) days after the date hereof and
maintained in accordance with an Escrow Agreement. The Escrow Agreement shall be
among IQO and QOS and a mutually acceptable independent third party that
customarily serves as an escrow agent for companies seeking to place software in
escrow and will provide that the Software and all Updates and Upgrades thereof
or thereto will be released from escrow to IQO in the event of the bankruptcy or
dissolution of QOS.
3. TERMS OF LICENSE
3.1 License Terms and Conditions. All orders of Software Copies by IQO
from QOS during the term of this Agreement shall be governed by the terms and
conditions of this Agreement,
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and nothing contained in any such order shall in any way modify such terms or
conditions or add any additional terms or conditions.
3.2 Best Efforts. During the License Term, IQO shall use its best
efforts to exploit the License granted herein throughout the Territory,
including, but not limited to, offering for sale Software in a manner designed
to maximize the royalties due to QOS and maintaining an inventory of Software
adequate to meet IQO's obligations under the Agreement.
3.3 Exclusive Period. The license granted herein shall be exclusive
through December 31, 2005. At such time as the license granted herein becomes
non-exclusive, QOS and IQO will use their best efforts to negotiate the terms
under which IQO may retain such license on a non-exclusive basis and QOS shall
have the right to enter into other non-exclusive license agreements relating to
the subject matter of this Agreement with such licensees as it in its sole
discretion shall determine.
4. PAYMENTS AND ROYALTIES
In consideration of the exclusive rights granted to it herein for the
License Term, IQO shall make the following payments to QOS;
4.1 Percentage Royalties. For calendar years 2000 and 2001, IQO shall
pay to QOS a Percentage Royalty as follows: 20% on the first One Million
($1,000,000) Dollars of Adjusted Net Sales, 18% on Adjusted Net Sales between
One Million and One ($1,000,001) Dollars and Two Million ($2,000,000) Dollars,
15% on Adjusted Net Sales between Two Million and One ($2,000,001) Dollars and
Five Million ($5,000,000) Dollars, and 12% on Adjusted Net Sales over Five
Million ($5,000,000) Dollars. QOS and IQO will use their best efforts to
renegotiate these royalty rates for calendar years 2002 and beyond. In the event
that QOS and IQO are unable to agree on Percentage Royalty rates for the
remaining License Term, the Percentage Royalty rates for calendar year 2002 and
beyond shall be those set forth above in this Section 4.1 (subject to any
necessary adjustments in accordance with Section 3.3 if the license becomes
non-exclusive). Percentage Royalties shall be payable on a quarterly basis, no
later than the twentieth (20th) day of the month immediately following the
quarter in which said sales are made. All Percentage Royalty payments shall be
sent to QOS via overnight courier together with the Quarterly Report, as defined
below, and shall be paid automatically by IQO without billing therefor by QOS.
4.2 Reimbursement of Third Party Costs. IQO shall reimburse QOS upon
demand for all royalties and license fees payable by QOS to third parties in
connection with the licenses granted herein.
4.3 Maintenance. IQO shall pay to QOS maintenance in an amount equal to
twenty five Percent (25%) of all IQO maintenance revenue derived from the
licenses granted herein. Such maintenance revenue shall be payable on a
quarterly basis, no later than the twentieth (20th) day of the month immediately
following each calendar quarter.
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5. REPORTING, ACCOUNTING AND AUDITING
5.1 Quarterly Reports. No later than the twentieth (20th) day of the
month immediately following each calendar quarter during the License Term, IQO
shall submit to QOS a written report on a form provided by QOS from time to
time, which shall include a written statement of IQO sales during such quarterly
period showing the number and type of sales of software, a calculation of the
Percentage Royalty due based thereon, and all other information requested by QOS
in this Agreement and as may otherwise be requested by QOS from time to time
(hereinafter "Quarterly Report"). Each Quarterly Report shall be accompanied by
the remittance to QOS of the Percentage Royalties shown to be due on the report
subject to Section 4.1, and shall be sent via overnight courier, and shall be
certified as correct by the Chief Executive Officer or Chief Financial Officer
of IQO or such other officers or employees of IQO as shall be designated by QOS.
In the event of an inquiry by QOS regarding any such report, IQO shall comply
promptly with QOS's reasonable request for information in the manner requested.
Within twenty (20) days after any expiration or termination of this Agreement,
IQO shall provide QOS a Quarterly Report for the last whole or partial quarterly
period during the License Term.
5.2 Late Payments. It is specifically understood by IQO that, with
respect to royalty payments and accounting statements, time is of the essence
and any payment due pursuant to this Agreement that is late shall bear interest
from five (5) days after the date upon which payment is due, until remittance
thereof to QOS at the prime rate of interest established by Chase Manhattan Bank
NA from time to time during said period, plus three percent (3%) per annum. The
operation of this clause is without prejudice to any other right or remedy QOS
may have pursuant to the terms of this Agreement or applicable law.
5.3 Payment Default. The acceptance of late payments hereunder, or the
acceptance of payment without a Quarterly Report or with an incomplete or
incorrect Quarterly Report, or any restrictive endorsement (1) shall not
constitute a waiver of timely payments, (2) shall not cure any default that
might exist, and (3) shall be without prejudice to any of the rights or remedies
that QOS may have hereunder.
In the event that a default is declared and the rights of IQO
under this Agreement are terminated, all payments required hereunder, including,
but not limited to, Percentage Royalties on past sales, shall be immediately due
and payable to QOS, in full, plus any interest due thereon at the rate
prescribed in subparagraph 5.2 above.
5.4 Proper Books And Records. IQO shall maintain separate and
appropriate books of account or computer records relating to the Software, in
accordance with reasonable accounting methods (including, without limitation, a
sales journal, sales return journal, cash receipt book, general ledger, and to
the extent reasonably available, purchase orders, and shall make accurate
entries concerning all transactions relevant to this Agreement. Each piece of
Software shall be assigned a unique identification number, which shall be the
number utilized to identify such Software in all of IQO's books and records and
computer records, and on all sales invoices and
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related documents. Such books and records of IQO shall at all times during the
License Term and for three years (3) thereafter (or in the event of a dispute
between the parties hereto, until three (3) years after said dispute is
resolved, whichever is later) be kept at IQO's Notice Address. IQO shall not
change the address at which such books and records are kept without thirty (30)
days prior written notice to QOS.
5.5 Right to Audit. Upon five (5) business days' notice to IQO, QOS, at
its expense (subject to the provisions of this subparagraph 5.5), shall have the
right during the License Term and for three (3) years thereafter at any time
during regular business hours, not more frequently than twice annually, to have
a qualified accountant selected by QOS audit the records of IQO to the extent
necessary to verify IQO's statements and payments of Percentage Royalties,
including the right to examine, photocopy and make extracts from such records.
Such records shall be made available to QOS's accountant at IQO's Notice
Address. IQO shall cooperate in a reasonable manner with and assist QOS's
accountant for the purpose of facilitating such audit.
If, as a result of such audit, QOS's accountant determines
that the amount of Percentage Royalties actually due was greater than the amount
reported by IQO in any Quarterly Report furnished pursuant to subparagraph 5.1,
QOS shall promptly furnish to IQO a copy of the report of its accountant setting
forth the amount of the deficiency showing, in reasonable detail, the basis upon
which such deficiency was determined. IQO shall promptly remit to QOS a sum
equal to such deficiency, together with interest thereon at the rate prescribed
in Paragraph 5.2 from the date such Percentage Royalties were due until the date
of such remittance. In addition, if the audit reveals underpayment by more than
five percent (5%) of the Percentage Royalties in any quarterly period, IQO shall
pay to QOS the cost of such audit.
If, as a result of such audit, QOS's accountant determines
that the amount of Percentage Royalties paid was greater than the amount
actually due, such overpayment will be promptly refunded to IQO.
5.6 Payment Currency. All calculations and payments required under this
Agreement shall be in United States Dollars.
5.7 Separate Account. All royalties payable to QOS hereunder shall be
maintained in a separate account by IQO, and IQO acknowledges that all sums
collected by IQO on behalf of QOS are deemed to be held in trust for and on
behalf of QOS until such time as such sums are paid to QOS in accordance with
the provisions herein.
5.8 Shipping. All Software Copies delivered pursuant to this Agreement
shall be suitably packed for shipment in QOS's standard shipping cartons, marked
for shipment to IQO's Notice Address or as otherwise specified by IQO, and
delivered to IQO or its carrier agent F.O.B. QOS's manufacturing facility, at
which time risk of loss shall pass to IQO. Unless otherwise instructed in
writing by IQO, QOS shall select the carrier. All freight, insurance, and other
shipping expenses, as well as any special packing expense, shall be paid by IQO.
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5.9 Conduct and Compliance with Law. IQO shall at all times refrain
from engaging in any illegal, unfair or deceptive trade practices or unethical
business practices with respect to the Software or otherwise, and shall comply
with all applicable laws, ordinances, rules and regulations, and IQO shall
obtain any and all permits, licenses, authorizations, and/or certificates that
may be required in any jurisdiction or by any regulatory or administrative
agency in connection with its activities hereunder.
6. USE OF QOS TRADEMARKS
6.1 Authorized Uses. IQO may use the trademarks, trade names, trade
dress, and other marks of QOS as identified on Exhibit D annexed hereto, as it
may be amended in writing by QOS from time to time (collectively, the "QOS
Trademarks") in connection with the marketing, promotion and advertising of the
Software. Such use may be in conjunction with IQO's use of its own marks. Before
any such use, IQO will provide to QOS copies of any such materials, and IQO
shall make no use of any QOS Trademarks to which QOS reasonably objects. If QOS
does not object within ten (10) business days after receipt of materials for
review, IQO shall be entitled to use the materials as set forth herein.
6.2 No Other Use. Except as authorized in this Agreement, IQO shall
have no rights with respect to any QOS Trademarks or other QOS products,
services, copyrights, or trade dress. IQO shall make no reference to QOS or the
Software without the prior written permission of QOS, except as set forth
herein.
6.3 Ownership by QOS. QOS represents and warrants that (i) the QOS
Trademarks are valid; (ii) it is the sole and exclusive owner thereof and has
the right to authorize the use of the QOS Trademarks by IQO contemplated in this
Agreement; and (iii) that the QOS Trademarks are not subject to any lien or
security interest, except as created by this Agreement. Any and all good will
arising from IQO's use of the QOS Trademarks shall inure solely to the benefit
of QOS, and neither during the License Term nor after the termination of this
Agreement shall IQO assert any claim to the QOS Trademarks (or any confusingly
similar xxxx) or such good will. IQO shall not take any action that could be
detrimental to the good will associated with the QOS Trademarks or with QOS. IQO
shall, during the term of this Agreement and after termination hereof, execute
such documents as QOS may request from time to time to ensure that all right,
title and interest in and to the QOS Trademarks reside with QOS. Without
limiting the foregoing, IQO shall not seek to register any QOS Trademarks, or
any xxxx confusingly similar to any QOS Trademarks, in any country or territory.
In the event IQO sells or distributes Software in countries in which one (1) or
more of the QOS Trademarks has not yet been registered, QOS shall have the
right, but not the obligation, to seek registration of the QOS Trademarks in
such countries. QOS makes no representation or warranty that the QOS trademarks
will be registered or are registered or registrable in such countries, and the
failure to obtain or maintain registrations thereof shall not be deemed a breach
hereof by QOS.
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7. SOFTWARE TRAINING AND SUPPORT
Exhibit B to this Agreement sets forth details regarding training,
support and maintenance for the Software, the respective rights and
responsibilities of QOS and IQO for such training and support, and any charges
to IQO for such training and support. IQO shall only distribute the Software
hereunder to End Users that purchase Software support for at least the first
year after acquisition ("First Year Support"), in accordance with QOS's
customary practices and charges on Software covered under this Agreement. QOS
shall not be entitled to any other compensation for any other support or other
services provided by QOS to IQO's End Users, except as otherwise expressly
agreed in writing by the parties.
8. TERMINATION
8.1 Default.
(a) This Agreement shall automatically terminate upon delivery
of notice of termination by QOS to IQO in the event that IQO (i) fails to use
its best efforts to exploit the License in accordance with Section 3.2, and does
not correct such failure within ten (10) days after written notice of such
failure is delivered to IQO; (ii) makes any transfer of this Agreement or the
Software and/or IQO violates Section 13 of this Agreement; (iii) makes any
unauthorized use or disclosure of QOS's Confidential Information or makes any
unauthorized use or disclosure of the Software or the QOS Trademarks; or (iv)
fails to timely pay to QOS amounts due, and does not correct such failure within
ten (10) days after written notice of such failure is delivered to IQO.
(b) If either party defaults in the performance of any of its
material obligations hereunder and if any such default is not corrected within
thirty (30) days after it shall have received written notice thereof from the
other party (other than for defaults as set forth in Section 8.1(a), above),
then the other party, at its option, may, in addition to any other remedies it
may have, terminate this Agreement upon the date set forth in such notice.
8.2 Insolvency. In the event IQO institutes voluntary bankruptcy
proceedings (and in recognition of the increased business risk incurred by QOS
as a result of such proceedings), then and in such event the Percentage
Royalties set forth in Section 4.1 above shall immediately and automatically,
without notice or warning from QOS to IQO, increase to twenty five percent (25%)
of Adjusted Net Sales. The Percentage Royalties shall also increase to
twenty-five percent (25%) of Adjusted Net Sales in the event that bankruptcy
proceedings are instituted against IQO involuntarily, provided that IQO shall
have sixty (60) days to have such proceedings dismissed or resolved in its favor
before such Percentage Royalty rate takes effect. In addition, and without
limitation to the preceding, this Agreement may be terminated by either party,
on notice, (i) upon the institution by the other party of insolvency,
receivership or bankruptcy proceedings or any other proceedings for the
settlement of its debts, (ii) upon the institution of such proceedings against
the other party, which are not dismissed or otherwise resolved in its favor
within sixty (60) days
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thereafter, (iii) upon the other party's making a general assignment for the
benefit of creditors, or (iv)upon the other party's dissolution or ceasing to
conduct business in the normal course.
8.3 Survival.
(a) Except as otherwise set forth herein, the parties rights
and obligations pursuant to paragraphs 2.5, 4, 5, 8.3, 9, 11, 12, 13 and 14
shall survive any termination or expiration of this Agreement.
(b) If this Agreement is terminated or expires, then all
payments due to QOS hereunder shall accelerate and become immediately due and
payable and all of IQO's rights and licenses with respect to the Software shall
immediately terminate, provided that (i) IQO's right to continue to use one copy
of the Software and one copy of the related Documentation, in accordance with
this Agreement, to support and maintain existing Software customers shall
survive; and (ii) IQO shall be entitled to dispose of Software Copies in its
inventory in accordance with the terms of this Agreement for which it has paid
QOS hereunder. All other copies of the Software and related Documentation in
IQO's possession shall be promptly returned to QOS.
9. INFRINGEMENT INDEMNITY
9.1 Indemnification of IQO. QOS, at its expense, will defend at its
sole cost and expense any action brought against IQO to the extent based on a
claim that the Software or Documentation, as supplied by QOS and used as
provided for in this Agreement, infringes any patent, copyright or trade secret
of any third party. QOS will pay any award against IQO, or settlement entered
into on IQO's behalf, based on such infringement only if IQO has notified QOS
promptly in writing of the claim, provided reasonable assistance in connection
with the defense and/or settlement thereof, and permitted QOS to control the
defense and/or settlement thereof. QOS shall have no liability if the alleged
infringement is caused by (a) compliance with designs, plans or specifications
of IQO; (b) modification of the Software or Documentation by any person other
than QOS; (c) the combination of the Software or Documentation with other items,
where the unmodified Software or Documentation, or the Software or Documentation
alone, would not have given rise to the claim; or (d) distribution of the
Software or the Documentation by IQO in the period 30 days after QOS has
provided notice to IQO of a potential infringement.
9.2 Indemnification of QOS. IQO agrees to indemnify and hold QOS
harmless against any liability, and any litigation cost or expense (including
attorneys' fees), arising out of third party claims against QOS as a result of
(a) IQO's use or distribution of the Software or the Documentation except to the
extent that the liability or litigation relates to a claim that the Software or
the Documentation, as supplied by QOS and used as provided for in this
Agreement, infringes any patent, copyright or trade secret of any third party,
or (b) misrepresentations by IQO with respect to the Software or Documentation.
QOS shall notify IQO promptly in writing of any such claim, provide reasonable
assistance in connection with the defense and/or settlement thereof, and permit
IQO to control the defense and/or settlement thereof.
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9.3 QOS Options. In the event of an infringement action against IQO
with respect to the Software or Documentation, or in the event QOS believes such
a claim is likely, QOS shall be entitled, at its option but without obligation,
to (i) appropriately modify the Software and/or Documentation licensed
hereunder, or substitute other Software and/or Documentation which, in QOS's
good faith opinion, does not infringe any third party intellectual property
rights; (ii) obtain a license with respect to the applicable third party
intellectual property rights; or (iii) if neither (i) nor (ii) is commercially
practicable, terminate this Agreement and IQO's licenses hereunder, which
termination shall be without penalty to QOS.
9.4 Entire Liability. Notwithstanding anything contained in this
Agreement, the foregoing states QOS's entire liability for actual or alleged
infringement of intellectual property rights and the limit of liability set
forth in paragraph 11 shall not apply to this paragraph 9.
9.5 Infringement by Third Parties. IQO shall immediately notify QOS of
any apparent infringement of or challenge to IQO's use of any Software or QOS
Trademarks, or claim by any person of any rights in any Software or QOS
Trademarks, and IQO shall not communicate with any person other than QOS and
their respective counsel in connection with any such infringement, challenge or
claim. QOS shall have sole discretion to take such action as it deems
appropriate in connection with the foregoing at its sole cost and expense, and
the exclusive right to control any settlement, litigation or other proceeding
arising out of any such alleged infringement, challenge or claim, also at its
sole cost and expense; provided, however, that if QOS takes no action with
respect to the foregoing, IQO may take such action as it deems appropriate at
its sole cost and expense. IQO agrees to execute any and all instruments and
documents, render such assistance, and do such acts and things as may, in the
opinion of QOS's counsel, be necessary or advisable to protect and maintain the
interests of QOS in any litigation or other proceeding or to otherwise protect
and maintain the interests of QOS in the Software and the QOS Trademarks. In the
event that IQO or QOS are awarded damages in any litigation or other proceeding
arising out of any infringement, challenge or claim by a third party with
respect to IQO's use of any Software or QOS Trademarks, the damages will first
be used to reimburse IQO or QOS, as the case may be, for their legal fees and
expenses and any remaining amount will be paid to IQO and be deemed Adjusted Net
Sales for the purposes of this Agreement.
9.6 Insurance. Each of the parties shall promptly procure and maintain
in full force and effect at all times during the License Term, with a national
insurance carrier or carriers reasonably acceptable to the other party, at least
Two Million ($2,000,000) Dollars coverage through a commercial general liability
policy, including products liability, and at least Three Million ($3,000,000)
Dollar umbrella general liability policy that specifically includes any and all
risks related to the sale or use of the Software or Documentation, and that
identifies the other party hereto, their respective owners, officers, directors,
employees, subcontractors, agents and managers as additional insureds.
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10. WARRANTY AND DISCLAIMER
10.1 Warranty. QOS warrants only that each Software Copy delivered to
it by QOS will be free of defects in materials and workmanship. QOS's exclusive
obligation and liability, and IQO's sole remedy, arising out of this warranty
shall be for QOS to replace defective Software Copies returned to QOS within
ninety (90) days after delivery to IQO.
10.2 Disclaimer. EXCEPT AS SET FORTH IN PARAGRAPH 10.1, QOS PROVIDES NO
WARRANTY, EXPRESS, IMPLIED, STATUTORY, OR OTHERWISE, AND SPECIFICALLY DISCLAIMS
ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, WITH
RESPECT TO THIS AGREEMENT, INCLUDING WITHOUT LIMITATION WITH RESPECT TO THE
SOFTWARE AND DOCUMENTATION AND ANY SERVICES FURNISHED BY QOS TO IQO IN
CONNECTION THEREWITH, WHICH ARE PROVIDED "AS IS".
10.3 IQO. IQO agrees that any and all warranties made to End Users of
IQO shall be made only by IQO except for the limited warranty made by QOS in the
QOS-supplied End User license agreement. IQO acknowledges and agrees that IQO
will make no additional representations or warranties to such End Users
concerning QOS, or any representations or warranties by QOS.
11. LIMITATION OF LIABILITY
IN NO EVENT SHALL QOS'S LIABILITY ARISING OUT OF OR UNDER THIS
AGREEMENT EXCEED THE AMOUNTS RECEIVED BY QOS FROM IQO HEREUNDER. IN NO EVENT
SHALL QOS BE LIABLE FOR COSTS OF SUBSTITUTE PRODUCTS OR SERVICES. IN NO EVENT
SHALL QOS BE LIABLE FOR LOST PROFITS, LOST BUSINESS OPPORTUNITIES, COSTS OF
RECREATION OF DATA OR ANY CONSEQUENTIAL, SPECIAL, INCIDENTAL, OR INDIRECT
DAMAGES, HOWEVER CAUSED AND WHETHER BASED ON BREACH OF CONTRACT, BREACH OF
WARRANTY, TORT (INCLUDING NEGLIGENCE), PRODUCT LIABILITY OR ANY OTHER THEORY OF
LIABILITY, ARISING OUT OF THIS AGREEMENT. IQO ACKNOWLEDGES AND AGREES THAT THE
PRICE TO IQO IS BASED IN PART UPON THESE LIMITATIONS, AND FURTHER AGREES THAT
THESE LIMITATIONS SHALL APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE
OF ANY LIMITED REMEDY.
12. CONFIDENTIALITY.
12.1 Confidential Information. As used in this Agreement, the term
"Confidential Information" shall mean any information disclosed by one party to
the other pursuant to this Agreement orally or which is in written, graphic,
machine readable or other tangible form.
12.2 Confidentiality. Each party shall treat as confidential all
Confidential Information of the other party, shall not use such Confidential
Information except as set forth herein, and shall
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use reasonable efforts not to disclose such Confidential Information to any
third party. Without limiting the foregoing, each of the parties shall use at
least the same degree of care which it uses to prevent the disclosure of its own
Confidential Information of like importance to prevent the disclosure of
Confidential Information disclosed to it by the other party under this
Agreement. Each party shall promptly notify the other party of any actual or
suspected misuse or unauthorized disclosure of the other party's Confidential
Information.
12.3 Exceptions. Notwithstanding the above, neither party shall have
liability to the other with regard to any Confidential Information of the other
which the receiving party can prove:
(a) was in the public domain at the time it was disclosed or
has become in the public domain through no fault of the receiving party;
(b) was known to the receiving party, without restriction, at
the time of disclosure, as demonstrated by written records in existence at the
time of disclosure;
(c) is disclosed with the prior written approval of the
disclosing party;
(d) was independently developed by the receiving party without
any use of the Confidential Information;
(e) becomes known to the receiving party, without restriction,
from a source other than the disclosing party without breach of this Agreement
by the receiving party and otherwise not in violation of the disclosing party's
rights; or
(f) is disclosed generally to third parties by the disclosing
party without restrictions similar to those contained in this Agreement.
In addition, the receiving party shall be entitled to disclose the other party's
Confidential Information to the extent such disclosure is required by order or
requirement of a court, administrative agency, or other governmental body,
provided, however, that the receiving party shall provide prompt notice thereof
to the disclosing party to enable the disclosing party to seek a protective
order or otherwise prevent or restrict such disclosure.
13. NON-TRANSFERABILITY OF SOFTWARE, DOCUMENTATION OR WORK
Neither the Software, the Documentation nor the Work, nor any rights
granted thereunder, may be assigned, sublicensed (except as set forth in Section
2.1 (b) above), or transferred by IQO either voluntarily or by operation of law
without the written consent of QOS. Any attempted assignment, violative
sublicense, or attempted transfer, whether voluntary or by operation of law,
shall be void and of no force or effect without the written consent of QOS. A
change of control of IQO, or a transfer of all or a controlling portion of the
stock of IQO shall be deemed to be an assignment in violation of this provision.
Further, any such attempted assignment, violative
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sublicense or attempted transfer, whether voluntary or by operation of law,
shall result in an immediate and automatic increase in the Percentage Royalties
payable by IQO to QOS set forth in Section 4.1 above, without notice or warning
by IQO to QOS, to twenty five percent (25%) across the whole range of percentage
rates set forth in Section 4.1. IQO agrees and acknowledges that a remedy at law
for any breach or threatened breach of the provisions of this Section 13 would
be inadequate and, therefore, the QOS shall be entitled to injunctive relief in
addition to any other available rights and remedies in case of any such breach
or threatened breach; provided, however, that nothing contained herein shall be
construed as prohibiting QOS from pursuing any other rights and remedies
available for any such breach or threatened breach.
14. GENERAL
14.1 Governing Law. This Agreement shall be governed by and interpreted
in accordance with the laws of the State of New York for agreements entered into
and to be wholly performed within the State, without reference to conflict of
laws principles.
14.2 Dispute Resolution.
(a) Each of the Board of Directors of QOS and IQO has
appointed an Intercompany Committee consisting of two (2) people with full
authority to review or amend the terms of this Agreement. Any dispute between or
among the parties with respect to this Agreement shall be resolved by the
Intercompany Committee of QOS and IQO. If the Intercompany Committee of QOS and
IQO are unable to resolve the dispute, the dispute will be resolved by a single
Arbitrator in New York City in accordance with and pursuant to the then existing
commercial arbitration rules of the American Arbitration Association. The
determination of the Arbitrator shall be conclusive, final and binding upon the
parties. The fees and expenses of the Arbitrator shall be borne equally by QOS
and IOS. The Arbitrator shall have full and complete access to all financial
statements, records, books of account and other information of QOS and IOS
material to its determination. The Arbitrator's award shall be final and binding
upon the parties and judgment thereon may be entered in any court of the State
of New York having jurisdiction over arbitration proceedings, or in any other
court having jurisdiction thereof. The service of any notice, process, motion or
other document in connection with an arbitration under this Agreement or for the
enforcement of an arbitration award hereunder may be effectuated by either
personal service upon a party or by certified or registered mail, return receipt
requested.
(b) Notwithstanding the foregoing, any actions seeking
equitable remedies, including a temporary restraining order and/or preliminary
injunctive relief, may be brought by either party in any New York federal or New
York state court or other court in the jurisdiction of the alleged violation.
Each party hereby irrevocably consents to the jurisdiction of such courts. IQO
acknowledges that the unauthorized disclosure, use or copying of the Software,
the Documentation or QOS's Confidential Information would result in immediate
and irreparable injury to QOS for which no adequate remedy at law will be
available. QOS acknowledges that the unauthorized disclosure, use or copying of
IQO's Confidential Information would result in immediate and
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irreparable injury to IQO for which no adequate remedy at law will be available.
Accordingly, the parties hereby consent to the entry of injunctive relief
prohibiting any such conduct by the other.
The parties expressly agree that the existence of any claims it may have against
the other, whether or not arising from this Agreement, shall not constitute a
defense to the enforcement by the party of the restrictive covenants set forth
in this Agreement. In connection with the above, the parties agree that neither
will be required to post a bond to obtain any injunctive relief.
14.3 Partial Invalidity. If any provision in this Agreement shall be
found or be held to be invalid or unenforceable in any jurisdiction in which
this Agreement is being performed, then the meaning of said provision shall be
construed, to the extent feasible, so as to render the provision enforceable,
and if no feasible interpretation would save such provision, it shall be severed
from the remainder of this Agreement, which shall remain in full force and
effect. In such event, the parties shall negotiate, in good faith, a substitute,
valid and enforceable provision, which most nearly effects the parties' intent
in entering into this Agreement.
14.4 Independent Contractors. The parties hereto are independent
contractors. Nothing contained herein or done in pursuance of this Agreement
shall constitute either party the agent of the other party for any purpose or in
any sense whatsoever, or constitute the parties as partners or joint venturers.
IQO shall make no representations or warranties on behalf of QOS with respect to
the Software or Documentation. Neither party shall have the right to bind the
other to any obligations to third parties.
14.5 Modification. No alteration, amendment, waiver, cancellation or
any other change in any term or condition of this Agreement shall be valid or
binding on either party unless the same shall have been mutually assented to in
writing by both parties.
14.6 Waiver. The failure of either party to enforce at any time any of
the provisions of this Agreement, or the failure to require at any time
performance by the other party of any of the provisions of this Agreement, shall
in no way be construed to be a present or future waiver of such provisions, nor
in any way affect the right of either party to enforce each and every such
provision thereafter. The express waiver by either party of any provision,
condition or requirement of this Agreement shall not constitute a waiver of any
future obligation to comply with such provision, condition or requirement.
14.7 Assignment. This Agreement and the licenses granted hereunder may
not be assigned by IQO (whether by transfer, sale of business, merger or by
operation of law) except with the express written consent of QOS and any
purported assignment not in compliance with the foregoing shall be null and void
and of no effect. QOS may assign this Agreement without restriction. QOS shall
have the right to terminate this Agreement without any penalty to QOS in the
event that IQO seeks to assign this Agreement to, or is merged, purchased, or
otherwise acquired by, a competitor of QOS. Subject to the foregoing, this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assign.
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14.8 Notices. Any notice required or permitted to be given by either
party under this Agreement shall be in writing, in English, and shall be
personally delivered or sent by commercial courier service (e.g., UPS), or by
first class mail (certified or registered), or by Telecopy confirmed by first
class mail (registered or certified), to the other party at its address first
set forth above, or such new address as may from time to time be supplied
hereunder by the parties hereto. If mailed, notices will be deemed effective
three (3) business days after deposit, postage prepaid, in the mail.
14.9 Export Regulations. IQO agrees to comply with all U.S. export
regulations in connection with distribution of Software or Documentation or
otherwise arising out of this Agreement.
14.10 Force Majeure. Notwithstanding anything else in this Agreement,
and except for the obligation to pay money, no default, delay or failure to
perform on the part of either party shall be considered a breach of this
Agreement if such default, delay or failure to perform is shown to be due to
causes beyond reasonable control of such party, including, but not limited to,
causes such as strikes, lockouts or other labor disputes, riots, civil
disturbances, actions or in-actions of governmental authorities or suppliers,
epidemics, war, embargoes, severe weather, fire, earthquakes, acts of God or the
public enemy, nuclear disasters, or default of a common carrier. The party
claiming Force Majeure shall give notice (a "Force Majeure Notice") to the other
party promptly upon becoming aware of such circumstance, stating the expected
duration of such condition. The other party shall be excused from performance to
the same extent and for the same period as the party claiming Force Mejeure.
14.11 No Third Party Beneficiaries. Unless otherwise expressly
provided, no provisions of this Agreement are intended or shall be construed to
confer upon or give to any person or entity other than QOS and IQO any rights,
remedies or other benefits under or by reason of this Agreement.
14.12 Entire Agreement. The terms and conditions herein contained,
including all exhibits hereto, constitute the entire agreement between the
parties and supersede all previous agreements and understandings, whether oral
or written, between the parties hereto with respect to the subject matter
hereof. The terms and conditions of the Agreement shall automatically apply to
each transaction between the parties contemplated by this Agreement
notwithstanding any additional or different terms and conditions of any ordering
document or other instrument submitted by IQO,
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which terms and conditions shall be void and of no effect.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be signed by duly authorized officers or representatives as of the
date first above written.
QUERYOBJECT SYSTEMS CORPORATION INTERNETQUERYOBJECT
CORPORATION
By:___________________________________ By:________________________________
Print Name:__________________________ Print Name:__________________________
Title:_______________________________ Title:_______________________________
Date:_______________________________ Date: _______________________________
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EXHIBIT A
SOFTWARE
Attach Current Product and Price List. The parties understand that all prices
may change upon 30 days written notice from QOS to IQO. All orders received
before the expiration of such 30 day period shall be at the original price.
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EXHIBIT B
TRAINING, SUPPORT AND MAINTENANCE
TRAINING & MATERIALS
QOS will furnish the IQO with the following:
1.1 Training. Technical training, Product positioning, Competitive
Analysis and Marketing Assistance will be made available to the IQO, at QOS's
USA Headquarters. Training will be provided free of charge, for a period of
thirty (30) days after the signing of this Agreement. All travel related
expenses will be born by the IQO. In the event the IQO requires "On-Site"
training, a charge will be levied at QOS's current consultant rates plus
associated travel costs.
1.2 Documentation. A Complete set of technical documentation for all
QOS products sold will be provided free of charge.
1.3 Marketing Materials. Relevant marketing materials will be provided
on an ongoing basis i.e. brochures, Promotional CD's, White Papers, Press
Extracts, Analyst Reports, etc.
2. SUPPORT AND MAINTENANCE
2.1 End User Support. QOS will make available to IQO's End User
customers software support and maintenance in accordance with QOS's customary
practices and charges.
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