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EXHIBIT 10.52
IRREVOCABLE OPTION AGREEMENT
This Irrevocable Option Agreement ("Agreement"), is made and entered
in Dallas County, Texas by and between Xxxx Xxxxxxxxxx ("Xxxxxxxxxx") and
Electronic Communication Systems, Inc., a Texas corporation ("ECS") as Sellers,
and Intelect, Inc., a Hawaii corporation ("Intelect") as Purchaser, effective
as of the 1st day of October, 1995 ("Effective Date").
RECITALS
WHEREAS, ECS is the full and exclusive owner of certain technology
concerning switching of digital data communications signals on fiber-optic
cable; and
WHEREAS, ECS is currently owned in its entirety by Xxxxxxxxxx and
Xxxxxxx Xxxxxxx; and
WHEREAS, Xxxxxxxxxx has certain rights to additional technology as
described in a Compromise and Settlement Agreement entered into between
Xxxxxxxxxx, OTX Corporation, Opcom, Inc. and Optek Technology, Inc. (the
"Settlement Agreement"), a copy of which is attached hereto as Exhibit "A" and
incorporated herein; and
WHEREAS, Intelect desires to purchase an irrevocable Option to
purchase the technology set forth above from ECS and the rights to such
additional technology owned by Xxxxxxxxxx pursuant to the terms of this
Agreement; and
WHEREAS, ECS and Xxxxxxxxxx desire to sell each parties' interest to
the technology owned by ECS and the additional rights to technology owned by
Xxxxxxxxxx pursuant to the Settlement Agreement; and
WHEREAS, Xxxxxxx Xxxxxxx shall enter into a separate Option Agreement
to convey his interest he may have in the technology owned by ECS the subject
of this Agreement.
NOW, THEREFORE, the parties to this Agreement agree as follows:
ARTICLE 1
TERMS OF SALE
1.1 Agreement to Sell. Subject to the terms and conditions
specified in this Agreement, ECS and Xxxxxxxxxx shall sell and convey to
Intelect, and Intelect shall purchase and accept from ECS and Xxxxxxxxxx, an
irrevocable option to purchase (the "Option") (1) the technology concerning the
switching of digital data communications from ECS; and (2) such other
technology the rights of which are owned by Xxxxxxxxxx pursuant to the
Settlement Agreement (collectively referred to herein as the "Technology"),
each of which is set forth in more particularity on Exhibit "B" for a period of
ninety (90) days from the Effective Date of this Agreement. Once the Option
has been exercised by Intelect, the parties shall then conduct the Closing of
the transaction within ninety (90) days from the date of the Option being
exercised by Intelect.
1.2 Advances. For the purpose of securing the performance of
Intelect under the terms and provisions of this Agreement and as a condition
precedent to ECS's and its shareholders obligations hereunder, Intelect, upon
its exercise of the Option, shall pay to Xxxxxxxxxx the sum of Twenty Thousand
Dollars ($20,000.00) as an advance on the transaction. Not more than ninety
(90) days following the date of the exercise of the Option, Intelect shall pay
to Xxxxxxxxxx an additional Thirty Thousand Dollars ($30,000.00). These
monies, in the total sum of Fifty Thousand ($50,000.00)
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(the "Advances") shall be applied to any Royalty Payments payable to Xxxxxxxxxx
pursuant to Article 1.7 of this Agreement as such Royalty Payments become due
and payable.
1.3 Definition of Technology. As used herein, the term
"Technology" shall mean all of the right, title and interest of ECS and
Xxxxxxxxxx in and to the Technology including but not limited to:
(a) All right, title and interest of ECS and Xxxxxxxxxx in and to
any and all applications relative to the Technology
(including, but not limited to any work in progress related to
the technology);
(b) All right, title and interest of ECS and Xxxxxxxxxx in and to
any and all derivative works of the Technology, now created or
created in the future; and
(c) All right, title, and interest of ECS and Xxxxxxxxxx in and to
any drawings, reports, compilations, notes, documents or
related written material concerning the creation and operation
of the Technology.
1.4 Exclusion of Liabilities. Intelect will not assume, and will
not discharge or otherwise be liable for any debts, liabilities or obligations
of ECS and Xxxxxxxxxx, and the Technology purchased shall not be or become
obligated or subject to, any liability of ECS and Xxxxxxxxxx, whether fixed or
contingent, recorded or unrecorded, known or unknown (collectively "Excluded
Liabilities"), and all Excluded Liabilities shall be and remain the sole
responsibility of ECS and Xxxxxxxxxx including, without limitation, the
following:
(a) The liabilities or obligations of ECS and Xxxxxxxxxx for
periods prior to the Closing;
(b) Federal, state or local tax liabilities or obligations of ECS
and Xxxxxxxxxx, including, without limitation, any income tax,
any tax recapture, and any FICA, withholding tax, workers'
compensation and any and all other taxes accrued prior to the
Closing;
(c) Liabilities or obligations arising out of or in connection
with claims for alleged acts or omissions including, but not
limited to, misappropriation, relating to the ownership or
operation of the Technology which occurred on or prior to the
Closing;
(d) Any debt, obligation, expense or liability of ECS and
Xxxxxxxxxx arising out of or incurred in respect to any
transaction of ECS and Xxxxxxxxxx occurring on or after the
Closing or for any violation by ECS and Xxxxxxxxxx of any
laws, regulations or ordinances.
Xxxxxxxxxx will negotiate to settle all outstanding prior liabilities relating
to the Technology and ECS. In addition to the consideration described below,
Intelect will contribute a maximum of One Hundred and Fifty Thousand Dollars
($150,000.00) towards the settlement of these liabilities. Xxxxxxxxxx hereby
acknowledges that the sum of $34,528.64 has been paid to satisfy the
liabilities owed to Outsourceing Networking, Inc., which is to be credited to
the amount of monies Intelect has offered to contribute pursuant to this
Agreement to reduce the liabilities.
1.5 Consideration. The value paid for the Technology (the
"Consideration") shall be $100.00 upon execution of the Agreement and as
follows:
(a) Intelect will retain the employment services of Xxxxxxxxxx for
a period of three (3) years commencing with the date of the
exercise of the Option, with responsibility for the further
development of the Technology subject to the terms of an
Employment Agreement, a form of which is attached hereto as
Exhibit "C".
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(1) Xxxxxxxxxx will be an employee of Intelect, receiving
the standard employment benefits and subject to the
standard employment policies in effect for all
Intelect employees.
(2) For the term of his employment, Intelect will pay to
Xxxxxxxxxx a base annual salary of Eighty Thousand
Dollars ($80,000.00), payable in accordance with the
standard payment schedule for all employees of
Intelect.
(3) In addition, Intelect will pay to Xxxxxxxxxx a bonus
as follows:
(i) In the first year of the term of his
employment, a bonus of Two Thousand Dollars
($2,000.00) per month, without condition.
(ii) In the second and third years of the term of
his employment, a bonus of Two Thousand
Dollars ($2,000.00) per month, conditional on
the delivery of specific improvements to the
Technology, as mutually agreed upon between
Xxxxxxxxxx and the President of Intelect, at
the beginning of each fiscal year.
(4) All developments (including inventions, whether
patentable or otherwise, trade secrets, improvements,
ideas and writings) which either directly or
indirectly relate to Intelect or any of its
subsidiaries or affiliates (the "Developments") which
Xxxxxxxxxx, either by himself or in conjunction with
any other person or persons, shall conceive, make,
develop, acquire or acquire knowledge of during the
term of employment, shall become and remain the sole
and exclusive property of Intelect or its designee.
Xxxxxxxxxx hereby assigns, transfers and conveys, and
agrees to so assign, transfer and convey, all of his
right, title and interest in and to any and all such
Developments, and to disclose fully as soon as
practicable, in writing, all such Developments to the
Board of Directors of Intelect or its designee. At
any time and from time to time, upon the request and
at the expense of Intelect, Xxxxxxxxxx will execute
and deliver any and all instruments, documents and
papers, give evidence and do any and all other acts
which, in the opinion of counsel for Intelect, are or
may be necessary or desirable to document such
transfer or to enable Intelect to file and prosecute
applications for and to acquire, maintain and enforce
any and all patents, trademark or tradename
registrations or copyrights with respect to any such
Development, or to obtain any extension, validation,
reissue, continuance or renewal of any such patent,
trademark or copyright. Intelect will be responsible
for the preparation of any such instruments,
documents and papers and for the prosecution of any
such proceedings and will reimburse Xxxxxxxxxx for
all reasonable expenses incurred by him in compliance
with the provisions of this Section.
(b) Intelect will pay to Xxxxxxxxxx a product royalty for a period
of ten (10) years commencing with the date of the exercise of
the Option (the "Product Royalty") on all products sold by
Intelect. "Product" is hereby defined to be any standard or
customized hardware or software sold by Intelect, the majority
of which consists of the Technology or any new designs,
improvements, or developments based primarily on the
Technology occurring during the term of Xxxxxxxxxx'x
employment by Intelect. The Product Royalty should be
calculated as follows:
(1) On the first Two Hundred Million Dollars
($200,000,000.00) of aggregate sales of the
Technology by Intelect, calculated on the net
Intelect invoice price, a royalty of Five Percent
(5%).
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(2) From Two Hundred Million and One Dollars
($200,000,001.00) to Five Hundred Million
($500,000,000.00) of aggregate sales of the
Technology by Intelect, calculated on the net
Intelect invoice price, a royalty of Four Percent
(4%).
(3) Over Five Hundred Million ($500,000,000.00) of
aggregate sales of the Technology by Intelect,
calculated on the net Intelect invoice price, a
royalty of Three Percent (3%).
The Product Royalty shall be calculated following the close of
each quarterly financial period of Intelect and paid within
ninety (90) days following the close of the financial period.
Payment shall be accompanied by a written statement issued by
the President of Intelect showing the basis of the calculation
of the Product Royalty. Said Product Royalty will be reduced
according to the amount of monies paid to Xxxxxxxxxx as an
Advance according to Article 1.2. Payments are based upon the
amount invoiced for each Product transaction. In the event
Intelect does not receive payment for the full invoice amount
of the Product, Intelect shall withhold from any future
amounts paid to Xxxxxxxxxx the amount of Product Royalty which
was attributable to the unpaid invoice amounts.
(c) In the event that Intelect sells the full product rights to
the Technology to a third party, Intelect shall request that
such third party assume responsibility for the payment of
Product Royalties as described in Article 1.5(b). However, in
the event that such third party does not agree to accept such
responsibility, Xxxxxxxxxx will receive a portion of the sale
price received by Intelect for the sale of the full product
rights to the Technology (the "Sales Price") as follows:
(i) If such a sale occurs in the first year following the
exercise of the Option, Xxxxxxxxxx will receive
Twenty Percent (20%) of the Sales Price.
(ii) If such a sale occurs in the second year following
the exercise of the Option, Xxxxxxxxxx will receive
Fifteen Percent (15%) of the Sales Price.
(iii) If such a sale occurs in the third or fourth year
following the exercise of the Option, Xxxxxxxxxx will
receive Ten Percent (10%) of the Sales Price.
(iv) If such a sale occurs in the fifth year following the
exercise of the Option, Xxxxxxxxxx will receive Five
Percent (5%) of the Sales Price.
(v) If such a sale occurs in the sixth to tenth year
following the exercise of the Option, Xxxxxxxxxx will
receive Three Percent (3%) of the Sales Price.
1.6 Inspection. Intelect and Intelect's agents and
representatives shall have reasonable access to the Technology until the
Closing hereof (the "Inspection Period") during normal business hours;
provided, however, that (a) any such access by Intelect shall be accomplished
without undue interference with the normal business operations of ECS and
Xxxxxxxxxx; (b) Intelect shall give ECS and Xxxxxxxxxx at least twenty-four
(24) hours prior written notice of Intelect's intention to inspect the
Technology; and (c) ECS and Xxxxxxxxxx may require that Intelect be accompanied
by a representative of ECS and Xxxxxxxxxx. The costs and expenses of
Intelect's investigation shall be borne solely by Intelect. All information
furnished by ECS and Xxxxxxxxxx to Intelect in accordance with the provisions
of this Agreement or obtained by Intelect in the course of its investigations
shall be treated as confidential information by Intelect and shall not be
disclosed by Intelect to any third party, provided that Intelect may disclose
such information to the agents, consultants and attorneys representing Intelect
in connection with the subject transaction. Intelect hereby indemnifies and
holds harmless ECS
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and Xxxxxxxxxx from and against any claims, causes of action, damages and
expenses (including attorney's fees) incident to, resulting from or in any way
arising out of Intelect's, or Intelect's agents or representatives, presence
in, on or about the Technology location. Intelect may, at any time during the
Inspection Period, terminate this Agreement upon written notice to ECS and
Xxxxxxxxxx.
1.7 Brokerage Commission. ECS, Xxxxxxxxxx and Intelect warrant
and represent to each other that no fees or commissions are or will be due in
connection with the sale of the Technology, from the execution of this
Agreement or the consummation of the transactions contemplated herein and each
party hereto hereby agrees to indemnify and hold harmless the other party from
and against any claims made by any person for any such fees, commissions or
like compensation, claiming to have dealt with the party so indemnifying the
other party in connection with this Agreement and the matters set forth herein.
1.8 Cost of Transaction. Whether or not the transactions
contemplated hereby shall be consummated, the parties agree that except as
otherwise specifically provided herein to the contrary:
(a) ECS and Xxxxxxxxxx will pay the fees, expenses, and
disbursements of ECS and Xxxxxxxxxx and such agents,
representatives, accountants, and counsel incurred in
connection with the subject matter hereof; and
(b) Intelect shall pay the fees, expenses and disbursements of
Intelect and its agents, representatives, accountants and
counsel incurred in connection with the subject matter hereof.
ARTICLE 2
COVENANTS, REPRESENTATIONS AND WARRANTIES
2.1 Covenants of ECS and Xxxxxxxxxx. ECS and Xxxxxxxxxx hereby
covenants with Intelect that from the date the Option is exercised to and
including the Closing, and with respect to Subsection (e), subsequent to the
Closing, as follows:
(a) Access to Records. ECS and Xxxxxxxxxx shall to the fullest
extent permissible by law (i) accord Intelect and Intelect's
duly authorized agents, representatives or counsel full
access, during normal business hours, to all of the records,
files, reports, and other business documents of ECS and
Xxxxxxxxxx pertaining to the Technology, (ii) furnish to
Intelect such relevant information with respect to the
Technology which are in ECS's and Xxxxxxxxxx'x possession,
provided that Intelect shall at all times relevant hereto
exercise due diligence to safeguard, maintain, and otherwise
secure the confidential nature of the information so furnished
to Intelect or its representative by ECS and Xxxxxxxxxx, and
(iii) permit Intelect to examine all files and records which
ECS and Xxxxxxxxxx may have with respect to the Technology and
(iv) use reasonable efforts to obtain all consents, including,
without limitation, consents of any governmental commission,
agency, or bureau, necessary to effectuate the purchase and
sale contemplated hereby.
(b) Consultation. ECS and Xxxxxxxxxx will consult with Intelect
at all times up to and including the Closing with respect to
the Technology provided that neither party hereto shall incur
any liability to anyone as a result of the advice or
suggestions offered in this connection.
(c) Operations. With respect to the ownership of the Technology,
between the Effective Date and the Closing, ECS and
Xxxxxxxxxx, except with the prior written consent of Intelect
to the contrary, will conduct its business operations relating
to the Technology subject to the following conditions:
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(1) Ordinary Course of Business. All business operations
shall be conducted diligently and only in the
ordinary course of business in substantially the same
manner as ECS and Xxxxxxxxxx has heretofore conducted
such business, and ECS and Xxxxxxxxxx shall not make
any material change in operations, finance,
accounting policies, or real or personal property
relating to the Technology.
(2) Maintenance of Technology. ECS and Xxxxxxxxxx shall
not sell, lease or otherwise dispose of any of the
Technology. ECS and Xxxxxxxxxx shall not make any
capital expenditures or capital additions or
betterments in connection with the Technology without
the express written consent of the Intelect.
(3) Contracts and Commitments. ECS and Xxxxxxxxxx shall
not make or renew, extend, amend, modify, or waive
any material provisions of any contract or commitment
relating to the Technology. ECS and Xxxxxxxxxx shall
use its best efforts to perform all of ECS's and
Xxxxxxxxxx'x obligations under agreements relating to
or affecting the Technology.
(4) Debts and Liabilities. ECS and Xxxxxxxxxx shall not
create or incur any liabilities relative to the
Technology other than current liabilities incurred in
the ordinary course of business.
(5) Conflicts. ECS and Xxxxxxxxxx shall not enter into
any transactions or take any acts which if perfected
or performed prior to the Closing, would constitute a
breach of the representations, warranties and
agreements of ECS and Xxxxxxxxxx contained herein.
(d) Advice of Change. ECS and Xxxxxxxxxx shall advise Intelect in
writing prior to the Closing of any material adverse change,
or the occurrence of any event which involves any substantial
possibility of a material adverse change in the condition,
financial or otherwise, of the Technology that has occurred
from the Effective Date until the Closing of which an
executive officer of ECS or Xxxxxxxxxx has acquired knowledge.
(e) Cooperation. Subject to the terms and conditions herein
provided, ECS and Xxxxxxxxxx will use reasonable efforts to
take, or cause to be taken, such action to execute and deliver
or cause to be executed and delivered, such additional
documents and instruments and to do, or cause to be done, all
things necessary, proper or advisable under the provisions of
this Agreement and under applicable law to consummate and make
effective all the transactions contemplated by this Agreement.
(f) Authority. ECS and Xxxxxxxxxx has full power and authority to
make, execute and deliver this Agreement and the transactions
contemplated hereby. This Agreement is a legal, valid and
binding obligation of ECS and Xxxxxxxxxx and is enforceable
against ECS and Xxxxxxxxxx in accordance with its terms.
(g) Absence of Conflicts. The execution and delivery of this
Agreement by ECS and Xxxxxxxxxx do not, and the performance by
ECS and Xxxxxxxxxx of ECS's and Xxxxxxxxxx'x obligations under
this Agreement will not:
(1) Violate any term or provision of any law or any
order, writ, or judgment applicable to ECS and
Xxxxxxxxxx;
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(2) Result in the creation or imposition of any lien or
other encumbrance upon ECS and Xxxxxxxxxx or any of
ECS's and Xxxxxxxxxx'x assets or properties that
individually or in the aggregate with any other liens
or encumbrances has or may reasonably be expected to
have a material adverse effect on the validity or
enforceability of this Agreement or on the ability of
ECS and Xxxxxxxxxx to perform ECS's and Xxxxxxxxxx'x
obligations under this Agreement; or
(3) Conflict with or result in a violation or breach of,
or constitute (with or without notice or lapse of
time or both) a default under, or give to any person
or entity any right of termination, cancellation,
acceleration, or modification in or with respect to,
any contract to which ECS and Xxxxxxxxxx is a party
or by which any of ECS's and Xxxxxxxxxx'x assets or
properties may be bound, and as to which any such
conflicts, violations, breaches, defaults, or rights
individually or in the aggregate have or may
reasonably be expected to have a material adverse
effect on the validity or enforceability of this
Agreement or on the ability of ECS and Xxxxxxxxxx to
perform ECS's and Xxxxxxxxxx'x obligations under this
Agreement.
(h) Litigation. ECS and Xxxxxxxxxx and each person executing this
Agreement on behalf of ECS and Xxxxxxxxxx hereby represent and
warrant that there are no actions, suits, investigations, or
proceedings pending against ECS and Xxxxxxxxxx, or (to the
best knowledge of ECS and Xxxxxxxxxx) threatened against ECS
and Xxxxxxxxxx, at law or in equity, before, in, or by any
person or entity, that individually or in the aggregate have
or may reasonably be expected to have a material adverse
effect on the validity or enforceability of this Agreement or
on the ability of ECS and Xxxxxxxxxx to perform ECS's and
Xxxxxxxxxx'x obligations under this Agreement.
(i) Full Disclosure. This Agreement, and all other documents and
information furnished to Intelect and Intelect's
representatives by ECS and Xxxxxxxxxx pursuant hereto do not
and will not include any untrue statement of a material fact
or omit to state any material fact necessary to make the
statements made and to be made not misleading.
(j) Ownership. ECS and Xxxxxxxxxx represents and warrants to
Intelect that he is the legal and beneficial owner of the
Technology along with Xxxxxxx Xxxxxxx. Xxxxxxx Xxxxxxx must
execute a separate agreement pertaining to the sale of the
Technology for this Agreement to be binding. At the Closing,
ECS and Xxxxxxxxxx will own and hold good and valid title to
the Technology, free and clear of all liens, encumbrances,
security interests, pledges, options, charges, and assessments
less the interest owned by Xxxxxxx Xxxxxxx but to be purchased
simultaneously with the purchase under this Agreement.
(k) Indemnification. ECS and Xxxxxxxxxx agree to indemnify and
hold harmless Intelect and Challenger International, Ltd. in
relation to any claim or action from any third party arising
from the ownership of the Technology.
(l) ECS and Xxxxxxxxxx agrees that Intelect shall have a right to
offset against the Consideration any damages caused by
misrepresentations, if any, by ECS and Xxxxxxxxxx with respect
to the above representations.
2.2 Intelect's Representations and Warranties. As a material
inducement to ECS and Xxxxxxxxxx to enter into this Agreement and perform its
obligations hereunder, Intelect represents and warrants to ECS and Xxxxxxxxxx
as follows:
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(a) Authority. Intelect is a corporation duly organized, validly
existing, and in good standing under the laws of the State of
Hawaii and has full corporate power and authority to enter
into this Agreement and to perform its obligations under this
Agreement. The execution, delivery and compliance with the
terms of this Agreement by Intelect and the performance by
Intelect of its obligations hereunder have been duly and
validly authorized by all necessary corporate action on the
part of Intelect. This Agreement constitutes a legal, valid
and binding obligation of Intelect and is enforceable against
Intelect in accordance with its terms. Each person executing
this Agreement on behalf of Intelect is authorized to do so.
(b) Absence of Conflicts. The execution and delivery of this
Agreement by Intelect do not, and the performance by Intelect
of Intelect's obligation under this Agreement will not:
(1) Violate any term or provision of any law or any
order, writ, or judgment applicable to Intelect;
(2) Conflict with or result in a violation or breach of,
or constitute (with or without notice or lapse of
time or both) a default under, any of the terms,
conditions, or provisions of the articles of
incorporation or bylaws of Intelect;
(3) Result in the creation or imposition of any lien or
other encumbrance upon Intelect or any of Intelect's
assets or properties that individually or in the
aggregate with any other liens or encumbrances has or
may reasonably be expected to have a material adverse
effect on the validity or enforceability of this
Agreement or on the ability of Intelect to perform
Intelect's obligations under this Agreement;
(4) Conflict with or result in a violation or breach of,
or constitute (with or without notice or lapse of
time or both) a default under, or give to any person
or entity any right of termination, cancellation,
acceleration, or modification in or with respect to,
any contract to which Intelect is a party or by which
any of Intelect's assets or properties may be bound,
and as to which any such conflicts, violations,
breaches, defaults, or rights individually or in the
aggregate have or may reasonably be expected to have
a material adverse effect on the validity or
enforceability of this Agreement or on the ability of
Intelect to perform Intelect's obligations under this
Agreement; or
(5) Require Intelect to obtain any consent, approval, or
action of or make any filing with or give any notice
to, any person or entity other than for the governing
board of Intelect or the shareholders, as applicable.
(c) Litigation. Intelect and each person executing this Agreement
on behalf of Intelect hereby represent and warrant that there
are no actions, suits, investigations, or proceedings pending
against Intelect, or (to the best knowledge of Intelect)
threatened against Intelect, at law or in equity, before, in,
or by any person or entity, that individually or in the
aggregate have or may reasonably be expected to have a
material adverse effect on the validity or enforceability of
this Agreement or on the ability of Intelect to perform
Intelect's obligations under this Agreement.
(d) Intelect Not A Nominee. Intelect represents and warrants that
Intelect is not acting as a nominee, agent, or trustee for any
person or entity who will be the true or beneficial owner of
the Technology; and Intelect further represents and warrants
that Intelect is purchasing the Technology for its own account
and not with the intent of selling the Technology to, or
exchanging the Technology with, any other person or entity who
has
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requested or arranged with Intelect to enter into this
Agreement with ECS and Xxxxxxxxxx for such purpose.
(e) Intelect Not in Bankruptcy Proceeding. Intelect and each of
the persons executing this Agreement on behalf of Intelect
hereby represent and warrant that, unless previously disclosed
in writing to ECS and Xxxxxxxxxx, there has not been filed by
or against Intelect or any corporation, partnership, or other
entity with respect to which Intelect, or any person or entity
which any of them represents is a principal shareholder,
controlling person or a general partner, as the case may be, a
petition in bankruptcy or insolvency proceedings or for
reorganization, or for the appointment of a receiver or
trustee, nor has any such entity made an assignment for the
benefit of creditors or filed a petition for an arrangement or
entered into an arrangement with creditors or admitted in
writing the inability to pay its debts as they become due,
which petition, proceeding, assignment or arrangement was not
dismissed or discontinued within sixty (60) days following the
date that such petition, proceeding, assignment, or
arrangement was filed, served or entered of record.
(f) Full Disclosure. This Agreement, and all other documents and
information furnished to ECS and Xxxxxxxxxx and ECS's and
Xxxxxxxxxx'x representatives by Intelect pursuant hereto do
not and will not include any untrue statement of a material
fact or omit to state any material fact necessary to make the
statements made and to be made not misleading.
2.3 Covenants of Intelect. Intelect covenants and agrees with ECS
and Xxxxxxxxxx as follows:
(a) Cooperation. Subject to the terms and conditions herein
provided, Intelect will use its best efforts to take, or cause
to be taken, such action to execute and deliver or cause to be
executed and delivered, such additional documents and
instruments and to do, or cause to be done, all things
necessary, proper or advisable under the provisions of this
Agreement and under applicable law to consummate and make
effective all the transactions contemplated by this Agreement.
(b) Confidentiality. In the event the Closing of the purchase of
the Technology does not occur, Intelect shall maintain and
shall use its best effort to require its accountants,
attorneys, and other representatives to maintain the
confidentiality of ECS's and Xxxxxxxxxx'x trade secrets,
books, and records.
This Section 2.3 shall survive any termination of the
Agreement.
ARTICLE 3
CLOSING
3.1 Closing. Intelect shall have ninety (90) days from the
Effective Date of this Agreement to exercise the Option to purchase the
Technology. The consummation of the sale and purchase of the Technology and
the other transactions contemplated by and described in this Agreement shall
take place at a closing ("Closing") to be held at the offices of Intelect's
legal counsel or at such other place as the parties hereto may agree on or
before the expiration of ninety (90) days from the exercise date of the Option.
To exercise the Option, Intelect must provide written notice to ECS and
Xxxxxxxxxx of its intent to exercise the Option.
3.2 Actions of ECS and Xxxxxxxxxx at Closing. At the Closing, ECS
and Xxxxxxxxxx shall deliver or cause to be delivered to Intelect, the
following:
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(a) Possession of all Technology;
(b) The xxxx of sale that is attached hereto as Exhibit "C",
transferring all of ECS's and Xxxxxxxxxx'x right, title and
interest in and to the assets of the Technology listed on
Exhibit "B"; and
(c) Such other instruments and documents as Intelect reasonably
deems necessary to effect the transaction contemplated hereby.
(d) A copy of resolutions duly adopted by ECS and Xxxxxxxxxx
authorizing and approving ECS's and Xxxxxxxxxx'x performance
of the transactions contemplated hereby and the execution and
delivery of the documents described herein, certified as true
and of full force as of the Closing by the Secretary or an
Assistant Secretary of ECS and Xxxxxxxxxx;
(e) Certificates of incumbency for the officers of ECS and
Xxxxxxxxxx making certifications for Closing dated as of
Closing;
(f) Such other evidence of the authority and capacity of ECS and
Xxxxxxxxxx and their representatives, and of the existence,
good standing and qualification to do business of ECS and
Xxxxxxxxxx as Intelect reasonably may require.
3.3 Actions of Intelect at Closing. At the Closing, Intelect
shall deliver to ECS and Xxxxxxxxxx the following:
(a) An Employment Agreement for execution by both parties, in the
form as set forth in Exhibit C;
(b) A copy of resolutions duly adopted by Intelect authorizing and
approving Intelect's performance of the transactions
contemplated hereby and the execution and delivery of the
documents described herein, certified as true and of full
force as of the Closing by the Secretary or an Assistant
Secretary of Intelect;
(c) Certificates of incumbency for the officers of Intelect making
certifications for Closing dated as of Closing;
(d) Such other evidence of the authority and capacity of Intelect
and their representatives, and of the existence, good standing
and qualification to do business of Intelect as ECS and
Xxxxxxxxxx reasonably may require;
(e) Such other instruments and documents as ECS and Xxxxxxxxxx
reasonably deems necessary to effect the transactions
contemplated hereby.
ARTICLE 4
DEFAULT REMEDIES
4.1 Intelect's Default. If (i) Intelect refuses or fails to
consummate the purchase of the Technology pursuant to this Agreement for any
reason other than termination hereof pursuant to a right granted Intelect
hereunder to do so, (ii) any representation or warranty made by or on behalf of
Intelect herein shall have been materially incorrect when made or shall become
incorrect in any material respect, or (iii) Intelect otherwise wrongfully fails
to perform any of its obligations or agreements as and when required hereunder,
for any reason other than termination hereof pursuant to a right granted to
Intelect hereunder to do so, then ECS and Xxxxxxxxxx, as its sole and exclusive
remedy, shall have the right to terminate this Agreement by giving Intelect
written notice thereof, in which event neither
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party hereto shall have any further rights, duties or obligations hereunder;
and ECS and Xxxxxxxxxx shall be entitled to receive or retain, as liquidated
damages (ECS and Xxxxxxxxxx and Intelect hereby acknowledging that the amount
of damages resulting from breach of this Agreement by Intelect would be
difficult or impossible to accurately ascertain), the Advances.
Notwithstanding the foregoing, in the event of any other default by Intelect
under this Agreement, including, without limitation, breach of any covenant,
representation or indemnity, which survives the Closing, ECS and Xxxxxxxxxx
shall have any and all rights and remedies available at law or in equity by
reason of such default. However, if Intelect terminates this Agreement
pursuant to a right granted to Intelect hereunder to do so, then neither party
hereto shall have any further rights, duties or obligation hereunder, and the
Advances shall be returned to Intelect with all interest accrued thereon.
4.2 ECS's and Xxxxxxxxxx'x Default. If ECS and Xxxxxxxxxx (i)
wrongfully refuses or fails to close the transaction contemplated by this
Agreement, or (ii) otherwise wrongfully fails to perform any of its obligations
or agreements hereunder, either prior to or at Closing, for any reason other
than termination hereof pursuant to a right granted to ECS and Xxxxxxxxxx
hereunder to do so, then Intelect may either terminate this Agreement, at which
time the Advances together with any interest accrued thereon shall be returned
to Intelect or Intelect may pursue specific performance of this Agreement.
ARTICLE 5
GENERAL
5.1 CHOICE OF LAW AND VENUE. THE PARTIES AGREE THAT THIS
AGREEMENT IS MADE AND ENTERED INTO AND IS PERFORMABLE IN DALLAS COUNTY, TEXAS,
AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF TEXAS, AND THAT ANY LITIGATION, SPECIAL PROCEEDING OR OTHER PROCEEDING AS
BETWEEN THE PARTIES THAT MAY BE BROUGHT, OR ARISE OUT OF, IN CONNECTION WITH OR
BY REASON OF THIS AGREEMENT SHALL BE BROUGHT IN THE APPLICABLE FEDERAL OR STATE
COURT IN AND FOR DALLAS COUNTY, TEXAS WHICH COURTS SHALL BE THE EXCLUSIVE
COURTS OF JURISDICTION AND VENUE.
5.2 Severability. In the event any provision of this Agreement is
held to be invalid, illegal or unenforceable for any reason and in any respect
by a court of competent jurisdiction, such invalidity, illegality, or
unenforceability shall in no event affect, prejudice or disturb the validity of
the remainder of this Agreement, which shall be in full force and effect,
enforceable in accordance with its terms and the provision held to be void,
illegal or unenforceable shall be limited so that it shall remain in effect to
the extent permissible by law.
5.3 Entire Agreement/Amendment. This Agreement and the exhibits
hereto supersede all prior or contemporaneous agreements, oral or written, and
constitute the entire agreement of whatsoever kind or nature existing between
or among the parties respecting the subject matter hereof, and no party shall
be entitled to benefits other than those specified herein. As between or among
the parties, no oral statements or prior written material not specifically
incorporated herein shall be of any force and effect; the parties specifically
acknowledge that in entering into and executing this Agreement, the parties
relied solely upon the representations and agreements contained in this
Agreement and no others. All prior or contemporaneous representations or
agreements, whether written or verbal, not expressly incorporated herein are
superseded and no changes in or additions to this Agreement shall be recognized
unless and until made in writing by all parties hereto. No amendment,
modification, deletion, release, termination, extension of, alternative,
variance or change in, or supplement to the provisions of this Agreement shall
be valid and effective or otherwise binding on the parties hereto unless or
until such amendment, etc., shall have been reduced to writing and executed by
the parties hereto with the same formality as this Agreement.
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5.4 Notice. Any notice to be given or to be served upon any party
hereto in connection with this Agreement must be in writing, and may be given
by certified or registered mail and shall be deemed to have been given and
received three (3) days after a certified or registered letter containing such
notice, properly addressed, with postage prepaid, is deposited in the United
States Mail, and if given otherwise than by certified or registered mail, it
shall be deemed to have been given when delivered to and received by the party
to whom it is addressed. Such notice shall be given to Intelect at Intelect's
address set forth herein, and to ECS and Xxxxxxxxxx at the address set forth
herein. Any party hereto may, at any time, by giving written notice to the
other party hereto, designate any other address in substitution of the
foregoing address to which such notice shall be given.
5.5 Nonwaiver. Unless otherwise expressly provided herein, no
waiver by ECS and Xxxxxxxxxx or Intelect of any provision hereof shall be
deemed to have been made unless expressed in writing and signed by such party.
No delay or omission in the exercise of any right or remedy accruing to ECS and
Xxxxxxxxxx or Intelect upon any breach under this Agreement shall impair such
right or remedy or be construed as a waiver of any such breach theretofore or
thereafter occurring. The waiver by ECS and Xxxxxxxxxx or Intelect of any
breach of any term, covenant or condition herein stated shall not be deemed to
be a waiver of any other breach, or of a subsequent breach of the same or any
other term, covenant or condition herein contained. All rights, powers,
options or remedies afforded to ECS and Xxxxxxxxxx or Intelect either hereunder
or by law shall be cumulative and not alternative, and the exercise of one
right, power, option or remedy shall not bar other rights, powers, options or
remedies allowed herein or by law, unless expressly provided to the contrary
herein.
5.6 Successors and Assigns. This Agreement shall be binding upon,
and shall inure to the benefit of, the parties hereto and their respective
heirs, legal representatives, successors and permitted assigns; provided,
however, Intelect may not assign this Agreement without the express prior
written consent of ECS and Xxxxxxxxxx, which consent may be withheld
absolutely, in ECS's and Xxxxxxxxxx'x sole discretion, or otherwise granted,
totally upon such terms and conditions as ECS and Xxxxxxxxxx shall elect to
impose, in ECS's and Xxxxxxxxxx'x sole discretion, regardless of basis or
reason, if any, therefor. Intelect agrees to furnish ECS and Xxxxxxxxxx such
information with respect to a proposed assignee and the proposed terms of the
assignment as ECS and Xxxxxxxxxx shall request. In the event ECS and
Xxxxxxxxxx consents to an assignment, Intelect shall not be relieved from any
liability under this Agreement by virtue of any such assignment. Any
assignment of this Agreement in violation of the foregoing provisions shall be
null and void.
5.7 Counterpart Execution. This Agreement may be executed in two
or more counterparts, each and all of which shall be deemed an original and all
of which together shall constitute but one and the same instrument.
5.8 Time of Essence. Time is of the essence in the performance of
each party's obligations hereunder.
5.9 Survival. Except as otherwise provided herein, the
representations, warranties and covenants made by the parties pursuant to this
Agreement shall survive the Closing for a period of one (1) year from the
Closing (but not in excess thereof), unless actually discovered through
investigations, if any, either party shall have made prior to the Closing.
5.10 Further Assurances. Each party hereto agrees to execute any
and all documents and to perform such other acts as may be necessary or
expedient to further the purposes of this Agreement and the transactions
contemplated hereby.
5.11 Construction. The parties acknowledge that each party and its
counsel have reviewed and contributed to the contents of this Agreement, and
the parties hereby agree that the normal rule of construction to the effect
that any ambiguities are to be resolved against the drafting party shall not be
employed in the interpretation of this Agreement or any Addendum or Exhibit
hereto. The headings
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used throughout this Agreement have been used for convenience only and do not
constitute matter to be considered in interpreting this Agreement. All
references in this Agreement to designated "Articles," "Sections," "Exhibits,"
"Addenda" and other subdivisions are to be designated Articles, Sections,
Exhibits, Addenda and other subdivisions of this Agreement as originally
executed. The words "herein," "hereof," "hereunder" and other words of similar
import refer to this Agreement as a whole (including all Exhibits and Addenda)
and not to any particular Article, Section, Exhibit, Addendum or other
subdivision. Whenever used herein, the singular number shall include the
plural and the plural the singular, and the use of any gender shall include all
genders.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed in multiple originals, all as of the Effective Date.
ECS:
ELECTRONIC COMMUNICATIONS SYSTEMS, INC.
Date: 11-1-95 By: /s/ Xxxx Xxxxxxxxxx
-------------------------
Name: Xxxx Xxxxxxxxxx
Its: President
Address: ----------------------------------
----------------------------------
INTELECT:
INTELECT, INC.
Date: 11-1-95 By: /s/ Xxxxx Xxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxx
Its: Vice President
Address: ----------------------------------
----------------------------------
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EXHIBIT "C"
EMPLOYMENT AGREEMENT
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EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made effective and entered
into this 1st day of October, 1995 by and between Intelect, Inc., a Hawaii
corporation ("Intelect"), and Xxxx Xxxxxxxxxx ("Xxxxxxxxxx") and is based in
part on the existence of the following facts:
RECITALS
A. Intelect and Xxxxxxxxxx have entered into an Irrevocable
Option Agreement which sets forth the terms for Intelect
purchasing certain technology from Xxxxxxxxxx and Electronic
Communication Systems, Inc, a Texas corporation;
B. As part of the consideration for the Irrevocable Option
Agreement, Intelect and Xxxxxxxxxx have agreed to certain
terms of employment;
C. This Agreement will set forth the terms of the employment
arrangement between Intelect and Xxxxxxxxxx.
TERMS OF EMPLOYMENT
In consideration of the premises set forth above and the mutual
promises set forth below, Intelect and Xxxxxxxxxx agree as follows:
1. Employment. Intelect hereby employs Xxxxxxxxxx for and during
the term hereof subject to the reasonable direction of Intelect and its
officers Xxxxxxxxxx hereby accepts such employment.
2. Duties of Xxxxxxxxxx. Xxxxxxxxxx shall have such duties,
responsibilities and authorities as are designated by the officers of Intelect,
and as may be reasonably assigned to Xxxxxxxxxx from time to time. Xxxxxxxxxx
agrees to devote his full time, best efforts, abilities, knowledge and
experience to the faithful performance of the duties, responsibilities and
authorities which reasonably may be assigned to Xxxxxxxxxx.
3. Term. This Agreement shall be effective as of the 1st day of
November, 1995 (the "Effective Date") and shall continue in force and effect
for a period of thirty six (36) months until October 31, 1998 (the "Term")
unless terminated as provided in Section 6 hereof. The Base Salary shall
commence though as of October 1, 1995, but shall not effect the Term as set
forth herein.
4. Compensation. Intelect shall pay Xxxxxxxxxx, as full
compensation for services rendered by Xxxxxxxxxx under this Agreement, as
follows:
(a) Base Salary. Intelect initially shall pay Xxxxxxxxxx a base
salary of Eighty Thousand and No/100 Dollars ($80,000.00) per
year. Such Salary for each year shall be paid by Intelect to
Xxxxxxxxxx in accordance with the regular payroll policies of
Intelect.
(b) Bonus Compensation. Intelect also shall pay Xxxxxxxxxx an
annual bonus ("Bonus Compensation") as follows:
(i) In the first year of the term of his employment, a
bonus of Two Thousand Dollars ($2,000.00) per month,
without condition.
(ii) In the second and third years of the term of his
employment, a bonus of Two Thousand Dollars
($2,000.00) per month, conditional on the delivery of
specific improvements to the Technology, as mutually
agreed upon between
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Xxxxxxxxxx and the President of Intelect, which shall
be reviewed at the beginning of each fiscal year.
5. Employment Benefits. In addition to the compensation payable
to Xxxxxxxxxx hereunder, Xxxxxxxxxx shall be entitled to the benefits afforded
to the employees of Intelect.
6. Termination and Compensation Thereof. This Agreement and
Xxxxxxxxxx'x employment hereunder may be terminated without any breach of this
Agreement at any time during the Term without notice only by reason of and in
accordance with the following provisions:
(a) Death. Xxxxxxxxxx'x death.
(b) Disability. Xxxxxxxxxx shall be prevented from performing his
duties hereunder by reason of becoming totally disabled as
hereinafter defined. For purposes of this Agreement,
Xxxxxxxxxx shall be deemed to have become totally disabled
when (i) Xxxxxxxxxx either receives "total disability
benefits" or (ii) the Board of Directors of Intelect, upon the
written report of a qualified physician designated by the
Board of Directors of Intelect or its insurers, shall have
determined that Xxxxxxxxxx has become physically and/or
mentally incapable of performing his duties under this
Agreement on a permanent basis.
(c) Termination by Intelect for Cause. Intelect may discharge
Xxxxxxxxxx for cause and terminate this Agreement immediately
upon written notice to Xxxxxxxxxx. For purposes of this
Agreement, a "discharge for cause" shall mean termination of
Xxxxxxxxxx upon written notice to Xxxxxxxxxx for one or more
of the following reasons:
(1) Gross mismanagement or gross neglect of Xxxxxxxxxx'x
duties as determined by the affirmative vote of
Intelect's Board of Directors after notice to
Xxxxxxxxxx of the particular details thereof and a
period of thirty (30) days thereafter within which to
cure such act or acts of gross mismanagement or gross
neglect, and the failure of Xxxxxxxxxx to cure such
act or acts within such thirty (30) day period;
(2) Conviction of Xxxxxxxxxx by a court of competent
jurisdiction of a felony or a crime involving moral
turpitude; or
(3) Xxxxxxxxxx'x failure to comply with any material
provision of this Agreement that has not been cured
within ten (10) days after notice of such
noncompliance has been given by Intelect to
Xxxxxxxxxx.
(d) Termination by Intelect with Notice. Intelect may terminate
this Agreement, for a reason other than as set forth herein or
without reason at any time upon thirty (30) days written
notice to Xxxxxxxxxx.
(e) Termination by Xxxxxxxxxx for Good Reason. Xxxxxxxxxx may
terminate this Agreement at any time for Good Reason. For
purposes of this Agreement, the term "Good Reason" shall mean,
without Xxxxxxxxxx'x express written consent, the occurrence
of any of the following circumstances ("Change"):
(1) Any failure by Intelect to comply with any of the
provisions of Sections 4 or 5 of this Agreement;
(2) Any failure by Intelect to comply with any material
provision of this Agreement that has not been cured
within thirty (30) days after notice of such
noncompliance has been given by Xxxxxxxxxx to
Intelect.
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7. Compensation on Termination.
(a) In the event this Agreement is terminated pursuant to Section
6, Xxxxxxxxxx shall be entitled only to such Compensation as
accrued but unpaid including any unused paid time off and
Bonus Compensation, if any.
8. Confidentiality.
(a) Xxxxxxxxxx recognizes and acknowledges that, by reason of his
past employment by Intelect and his continued employment by
and service to Intelect, he has had, and will continue to
have, access to confidential information of Intelect and its
parent and its subsidiaries, including, without limitation,
information and knowledge pertaining to products, inventions
innovations, designs, ideas, plans, trade secrets information,
manufacturing, packaging, advertising, distribution and sales
methods and systems (unique or proprietary to Intelect), sales
and profit figures, customer and client lists, and
relationships between Intelect and its affiliates and dealers,
distributors, wholesalers, customers, clients, suppliers and
others who have had or will have business dealings with
Intelect and its parent and its subsidiaries ("Confidential
Information"). Xxxxxxxxxx acknowledges that such Confidential
Information is a valuable and unique asset and covenants that
he will not disclose any such Confidential Information to any
person for any reason whatsoever without the prior written
authorization of Intelect, unless such information is in the
public domain through no fault of Xxxxxxxxxx or except as may
be required by law.
(b) Upon termination of his employment, Xxxxxxxxxx will surrender
to Intelect any and all originals and copies of Confidential
Information, in whatever form. Xxxxxxxxxx acknowledges that
all such materials are the sole property of Intelect and that
he has no right, title or other interest in or to such
materials.
9. Competition. Xxxxxxxxxx agrees that during the term of his
employment and for a period of two (2) years thereafter, Xxxxxxxxxx shall not
directly or indirectly, as an employee, employer, consultant, agent, principal,
partner, stockholder, corporate officer, director, or in any other individual
or representative capacity, perform for a Competitor of Intelect the same or
similar services as those performed for Intelect, its parent or subsidiaries or
attempt to interfere with, or obtain the services of, any employee of Intelect,
its parent or subsidiaries. For the purpose of the immediately preceding
sentence, the term "Competitor" means any natural person or entity engaged in
the design, development, production, sale or installation of products, services
or software substantially similar to the "Developments" (as defined in Section
10(a) below). Intelect will consider and promptly respond to written requests
by Xxxxxxxxxx for waiver of the foregoing restrictions.
10. Ownership of Work Product.
(a) All developments (including inventions, whether patentable or
otherwise, trade secrets, discoveries, improvements, ideas and
writings) which either directly or indirectly related to
Intelect or any of its subsidiaries or affiliates (the
"Developments") which Xxxxxxxxxx, either by himself or in
conjunction with any other person or persons, has conceived,
made developed, acquired or acquired knowledge of during his
employment by Intelect or which Xxxxxxxxxx, either by himself
or in conjunction with any other person or persons, shall
conceive, make, develop, acquire or acquire knowledge of
during the course of his employment, shall become and remain
the sole and exclusive property of Intelect or its designee.
Developments also shall include the "Technology" and "Product"
as defined in the above- referenced Irrevocable Option
Agreement.
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(b) Xxxxxxxxxx hereby assigns, transfers and conveys, and agrees
to so assign, transfer and convey, all of his right, title and
interest in and to any and all such Developments, and to
disclose fully as soon as practicable, in writing, all such
Developments to Intelect or its designee. At any time and
from time to time, during or after Xxxxxxxxxx'x employment
with Intelect, upon the request and at the expense of
Intelect, Xxxxxxxxxx will execute and deliver any and all
instruments, documents and papers, give evidence and do any
and all other acts which, in the opinion of counsel for
Intelect, are or may be necessary or desirable to document
such transfer or to enable Intelect to file and prosecute
applications for and to acquire, maintain and enforce any and
all patents, trademark or tradename registrations or
copyrights with respect to any such Development, or to obtain
any extension, validation, reissue, continuance or renewal of
any such patent, trademark or copyright. Intelect will be
responsible for the preparation of any such instruments,
documents and papers and for the prosecution of any such
proceedings and will reimburse Xxxxxxxxxx for all reasonable
expenses incurred by him in compliance with the provisions of
this Paragraph 3.
11. General Provisions.
(a) Severability. If any provision contained in this Agreement is
determined by a court of competent jurisdiction to be void,
illegal or unenforceable, in whole or in part, then the other
provisions contained herein shall remain in full force and
effect as if the provision which was determined to be void,
illegal, or unenforceable had not been contained herein.
(b) Waiver, Modification, and Integration. The waiver by any
party hereto of a breach of any provision of this Agreement
shall not operate or be construed as a waiver of any
subsequent breach by any party. This instrument contains the
entire agreement of the parties concerning employment and
supersedes all prior and contemporaneous representations,
understandings and agreements, either oral or in writing,
between the parties hereto with respect to the employment of
Xxxxxxxxxx by Intelect and all such prior or contemporaneous
representations, understandings and agreements, both oral and
written, are hereby terminated. This Agreement may not be
modified, altered or amended except by written agreement of
all the parties hereto.
(c) Binding Effect. This Agreement shall be binding and effective
upon Intelect and its successors and permitted assigns, and
upon Xxxxxxxxxx and Xxxxxxxxxx'x heirs and representatives;
provided, however, that Intelect shall not assign this
Agreement without the written consent of Xxxxxxxxxx.
(d) Governing Law. The parties intend that the laws of the State
of Texas should govern the validity of this Agreement, the
construction of its terms, and the interpretation of the
rights and duties of the parties hereto.
(e) Counterpart Execution. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute but one
and the same instrument.
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(f) Confidentiality. This Agreement is confidential, and the
substance may be disclosed only as mutually agreed by the
Parties or as may be required by law.
INTELECT, INC.:
By: /s/ Xxxxx Xxxxxxx
---------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
XXXX XXXXXXXXXX:
/s/ Xxxx Xxxxxxxxxx
--------------------------------
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