SOFTWARE DEVELOPMENT AGREEMENT
THIS DEVELOPMENT AGREEMENT (this "Agreement") is made and entered into this
20th day of August, 1999, by and between Navi-GATES Partnership LLP (hereinafter
"NAVI-GATES"), a Texas Limited Partnership with offices at 000 Xxxxxxxx, Xxxxx
000, Xxxxxxx, Xxxxx, 00000 and Sharp Technology Inc. (hereinafter "SHARP"), A
Delaware Corporation with offices at 0000 Xxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx
00000.
WITNESSETH:
WHEREAS, SHARP desires to engage NAVI-GATES to develop, create, test, and
deliver certain programming code and materials, and to implement software
products, and NAVI-GATES is interested in accepting such engagement, subject to
the parties' further agreement on the scope and terms of such work; and
WHEREAS, NAVI-GATES and SHARP mutually desire to set forth in this
Agreement certain terms applicable to such work;
NOW, THEREFORE, NAVI-GATES and SHARP, intending to be legally bound, hereby
agree as follows:
SECTION 1
DEFINITIONS
When used in this Agreement, the capitalized terms listed in this Section 1
shall have the following meanings:
1.1 Customers -- shall mean any person or entity which uses the Project
Code developed subject to this Agreement. Customers shall be deemed to be the
ultimate users of the Project Code such that in the event the Project Code is
re-distributed by a partner, affiliate or other entity with SHARP's permission,
that the Customer shall be deemed to be the re-distributing entity's ultimate
customer.
1.2 Days - shall mean calendar days and include weekends and holidays
unless otherwise stated.
1.3 Deliverables -- shall mean all services, materials or manpower,
developed for or delivered to SHARP by NAVI-GATES under this agreement.
1.3.1 Services - Software Design and Development, Customized Software
Maintenance, and Software Evaluation and Testing.
1.3.2 Material -- shall mean software products, codes and
documentation as hereunder.
1.3.3 Manpower -- shall mean Deputation of IT Experts.
- 63 -
1.4 Project Code -- shall mean computer programming code. If not otherwise
specified, Code shall include both Object Code and Source Code in connection
with the Project Specification appended hereto as Exhibit A.
1.4.1 Object Code -- shall mean the machine-readable form of the Code.
1.4.2 Source Code -- shall mean the human-readable form of the Code
including all comments and any procedural code such as job
control language.
1.5 Derivative Work -- shall mean a work that is based upon one or more
preexisting works, such as a revision, modification, translation, abridgement,
condensation, expansion, or any other form in which such preexisting works may
be recast, transformed, or adapted. For purposes hereof, a Derivative Work shall
also include any compilation that incorporates such a preexisting work. Both
parties agree that SHARP shall have the right to independently develop software
code which is the same or similar to the Project Code, so long as such
independently developed code does note include any portion of the Project Code.
1.6 Documentation -- shall mean user manuals and other written materials
that relate to particular Project Code, including materials useful for design
(e.g., logic manuals, flow charts, and principles of operation). Documentation
shall include manuals or any other written materials relating to any
Maintenance Modifications or Basic Enhancements thereto created by NAVI-GATES
from time to time, in connection with any obligations under this or other
Agreements.
1.7 Enhancements -- shall mean changes and/or additions to NAVI-GATES
deliverables issued hereunder, and other than Maintenance Modifications to Code
and related Documentation, including all new releases, that improve functions,
add new functions, or significantly improve performance by changes in system
design or coding.
1.7.1 Basic Enhancements -- shall mean any Enhancements that are not
Major Enhancements.
1.7.2 Major Enhancements -- shall mean changes and/or additions to the
deliverables and/or other products that: (1) have a value and utility
separate from the use of the Code and Documentation; (2) as a
practical matter, may be priced and offered separately from the Code
and Documentation; and (3) are not made available to any of
NAVI-GATES'S customers without separate charge.
1.8 Error -- shall mean any error, problem, or defect resulting from (1)
an incorrect functioning of Code, or (2) an incorrect or incomplete statement of
diagram in Documentation, if such an error, problem, or defect renders the Code
inoperable, causes the Code to fail to meet the specifications thereof, causes
the Documentation to be inaccurate or incomplete in any material respect, causes
incorrect results, or causes incorrect functions to occur when any such
deliverables are used.
1.9 Maintenance Modifications -- shall mean any modifications or
revisions, other than Enhancements, to Code or Documentation that correct
Errors, support new releases of the operating systems with which the Code is
designed to operate, support new input/output (I/O) devices, or provide other
incidental updates and corrections in connection with this agreement.
1.10 Project -- shall mean the development and delivery of "It's Your Net"
(IYN), in accordance with its detailed specifications and requirements including
objectives, scope, boundaries, environment/platform, design, method of
development and execution, and functionality as described in detail in Exhibit A
to the Agreement. At a minimum, such Exhibit shall include:
- 64 -
a. Description and/or specifications of the services to be performed
and the Deliverables to be delivered to SHARP.
c. The time schedule for performance and for delivery of the
Deliverables
d. Completion and acceptance criteria for the Deliverables
In addition, the Exhibit A may include:
1. Provisions for written and/or oral progress reports by NAVI-GATES
2. Detailed functional and technical specifications and standards
for all services and Deliverables, including quality standards
3. Documentation standards, Test plans and scripts
1.11 NAVI-GATES'S Royalty Amount - shall mean royalties calculated at One
United States Dollar (U.S. $1.00) per copy of the Project Code or any Derivative
Work thereof sold or transferred for use to a Customer.
SECTION 2
CONTRACT ADMINISTRATION - Intentionally left blank
SECTION 3
NOTICE OF DELAY
NAVI-GATES agrees to notify SHARP promptly of any factor, occurrence, or
event coming to its attention that may affect NAVI-GATES'S ability to meet the
requirements outlined under this Agreement, or that is likely to occasion any
material delay in delivery of Deliverables. Such notice shall be given in the
event of any loss or reassignment of key employees or major equipment failure.
SECTION 4
COMPENSATION
NAVI-GATES shall be compensated by SHARP for performance under this
agreement as set forth below:
4.1 Fixed Development Price. For completion of Project criteria as
detailed in Exhibit A, including the delivery and acceptance of Project Code and
Documentation, SHARP agrees to pay NAVI-GATES a development fee of Two Hundred
Thousand United States Dollars ($200,000) as follows:
a) $15,000 upon execution of this Agreement
b) $35,000 upon completion, delivery and acceptance of interfaced
Alpha code, as further detailed in Exhibit A of this Agreement.
c) $50,000 upon completion, delivery and acceptance of Beta code, as
further detailed in Exhibit A of this Agreement.
d) $50,000 upon completion, delivery and acceptance of First Golden
Master code, as further detailed in Exhibit A of this Agreement.
e) $50,000 upon final completion, delivery and acceptance of Final
Project Code and Documentation requirements as detailed in
Exhibit A of this Agreement.
- 65 -
4.2 Royalties. SHARP shall also pay NAVI-GATES a Royalty per copy of the
Project Code or any Derivative Work thereof, sold or transferred for use to a
Customer. The amount of such royalty to be calculated in accordance with the
terms of Section 1.11 of this Agreement.
4.3 Certification and Payment of Royalty. SHARP shall, within sixty (60)
days after the end of each fiscal quarter, certify to NAVI-GATES in writing as
to all Royalty Amounts then due based upon delivery, sales, and use of the
Project Code during the immediately preceding fiscal quarter, and shall
accompany such certification by payment in full of the royalty Amount due in
respect of such prior fiscal quarter ("Royalty Payments").
4.4 Review of SHARP's Accounts. NAVI-GATES shall have the right, in its
sole discretion and at its expense, not more than once a year, to have a review
conducted, by a mutually acceptable independent accounting firm of national
standing, of SHARPs books of record related to the sales and use of the Project
Code. That review shall be for the strict purpose of making a determination that
the amounts owed to NAVI-GATES have been or shall be properly paid in accordance
with the terms of this Agreement. The results of this review shall be
confidential, and may not be used for any other purpose. In the event the review
results in the discovery of any underpayment of Royalty Amounts, and SHARP
confirms that underpayment with any U.S. nationally recognized certified public
accounting firm, the amount of the underpayment shall be paid to NAVI-GATES
within fifteen (15) days of the date of that independent confirmation. In the
event confirmed underpayments in Royalty Amount exceed five percent (5%) of the
total royalty amount due for the period under review, SHARP agrees to reimburse
NAVI-GATES for its expense incurred in conducting the review. Any overpayment of
Royalty Amounts so confirmed shall likewise be reimbursed to SHARP by
NAVI-GATES.
4.5 Royalty-free Copies. NAVI-GATES grants SHARP the right to distribute
1,000 units of the Project Code royalty-free during any running twelve month
period.
SECTION 5
EXPENSES
Except as expressly agreed otherwise by SHARP, NAVI-GATES shall bear all of
its own expense arising from its performance of its obligations under this
Agreement. The foregoing not withstanding, for its own convenience , SHARP may
elect to provide incidental services to Navi-GATES including limited work
space(s), utilities, clerical assistance and reproduction services, supplies,
and the like.
SECTION 6
DELIVERY AND ACCEPTANCE
NAVI-GATES shall deliver all documentation and Project Code to SHARP's
Technical Coordinator for testing and acceptance in accordance with the schedule
detailed in Exhibit A. NAVI-GATES shall memorialize such delivery in a Delivery
Confirmation that sets forth the nature and condition of the Deliverables, the
medium of delivery, and the date of their delivery. SHARP's Technical
Coordinator shall countersign such Delivery Confirmation so as to indicate its
receipt of the contents. SHARP's Technical Coordinator shall commence acceptance
testing immediately following its receipt of the Deliverables. Upon completion
of such testing, SHARP shall issue to NAVI-GATES'S Technical Coordinator notice
of acceptance or rejection of deliverables. In the event of rejection, SHARP
shall give its reasons for rejection to NAVI-GATE'S Technical Coordinator in
reasonable detail. NAVI-GATES shall use all reasonable effort to correct any
deficiencies or non-conformities and resubmit the rejected items as promptly as
possible. It is expressly declared by both SHARP and NAVI-GATES that time is of
the essence as it relates to delivery and acceptance under this Agreement.
- 66 -
SECTION 7
OWNERSHIP, RIGHTS, INVENTIONS AND PATENTS
7.1 Definitions. As used in this Agreement:
(a) "Conceived" and "Conception," as to an Invention, are used in
the same sense as in the patent laws of the United States, and generally
speaking refer to the formation of a complete mental picture of the Invention,
requiring only routine work by a hypothetical person of ordinary skill in the
art to which the Invention pertains to reduce the Invention to practice.
(b) Intellectual Property Rights means any and all rights to
exclude existing from time to time in a specified jurisdiction under patent law,
copyright law, moral rights law, trade-secret law,semiconductor chip protection
law, trademark law, unfair competition law, or other similar rights.
(c) "Invention" means any invention, discovery, process, art,
method (including mathematical algorithms), machine, manufacture, composition of
matter, or improvement thereof, whether or not patentable, to the extent that it
is the subject of an Intellectual Property Right.
(d) "Work of Authorship" means:
(1) a work of authorship protectable under the copyright laws of
an applicable jurisdiction, or
(2) a mask work protectable under the semiconductor chip
protection laws of an applicable jurisdiction.
(e) "Relating to the Licensed Software":
(1) with respect to an Invention, means that the Invention was
Conceived or reduced to practice as a direct result of
Development Work; and
(2) with respect to a Work of Authorship, means that the Work of
Authorship was created within the scope of Development Work.
7.2 Ownership of the Project Code, The ownership of the Project Code will be
entirely in SHARP. SHARP shall be free to license, assign, or otherwise transfer
rights in and to the Project Code to any third party so long as such license,
assignment or transfer of rights is noticed to NAVI-GATES and the derivative
works royalties due NAVI-GATES, are paid as agreed.
7.3 Ownership of Inventions and Works of Authorship. The ownership of any
Inventions or Works of Authorship Relating to the Project Code will remain in
both SHARP and NAVI-GATES. SHARP shall be free to license, assign, or otherwise
transfer rights in and to any Inventions or Works of Authorship relating to the
Project Code to any third so long as such license, assignment or transfer of
rights is noticed to NAVI-GATES and the fees due NAVI-GATES in lieu of future
royalties, are paid as agreed.
7.4 Disclosure of Inventions and Works. Each Party shall promptly
notify the other Party of all Inventions or Works of Authorship Relating to the
Project Code that may be made by the disclosing Party, alone or jointly with any
other person and/or the personnel of any other party. All such disclosures
shall include:
(a) complete and accurate copies of all source code, executable
code, design documentation, user documentation, work notes, test data, reports,
samples, and other tangible evidence or results of such Invention or Work of
Authorship; and
(b) all information available to the disclosing Party concerning
any third-party Intellectual Property Rights that may affect the utilization of
the Invention or work of authorship, including any applicable third-party
license agreements (which the disclosing Party may at its option designate as
Confidential/Proprietary Information for disclosure only to inside or outside
counsel for the other Party).
- 67 -
7.5 Patent Applications; Copyright or Mask Work Registrations. SHARP
and NAVI-GATES shall make individual determinations whether, when, and in which
countries to seek patent protection; copyright or mask work registrations for
Inventions or Works of Authorship Relating to the Project, and will individually
bear all expenses associated with seeking such patent protection or
registrations. Both Parties agree to grant the other a fully paid,
non-exclusive, unlimited license to any intellectual property rights granted
through the patent, copyright or mask work registration process for Inventions
or Works of Authorship directly relating to the Project Code.
7.6 Non Competition by NAVI-GATES. NAVI-GATES agrees that it shall not
compete with SHARP by offering the Product Code for sale or license to
any domestic U.S. telecommunication giant except through SHARP. As
defined here, a domestic U.S. telecommunication giant shall include
the domestic operations of AT&T, Sprint, MCI, any of the regional Xxxx
operating Companies, or other similar giant telecommunication company
offering classic voice over PSTN services or any other U S Domestic
company who may compete with any such U.S. telecommunications giant
such as ISP's Cable companies, long distance Companies, etc
7.7 Grant of license to NAVI- GATES. Pursuant to the this Agreement, SHARP
hereby grants to NAVI-GATES a non-exclusive, royalty free, unlimited
license to use the Project Code, both object code and source code, for
any and all purposes, including, without limitation, to create
Derivative Works therefrom, and to modify and enhance the Project
Code. NAVI-GATES shall further have the right to sub-license the
Project Code and any Derivative Works based thereon to any third party
under such terms and conditions as NAVI-GATES, in its sole discretion
deems appropriate, EXCEPT that any such sub-license of the Project
Code shall be subject to the terms and conditions of non-competition
and confidentiality with respect to the Project Code set forth in
Sections 7.6 and 14 of this Agreement. No royalties shall be due SHARP
in connection with its license of the Project Code to NAVI-GATES. The
parties to this Agreement hereby acknowledge the sufficiency of the
consideration upon which this Agreement is based.
7.8 Ownership of the Derivative Works. The ownership of any Derivative
Works based on the Licensed Software made by NAVI-GATES as permitted
in accordance with Agreement, and any Inventions or Works of
Authorship relating to such Derivative Works, will be entirely in
NAVI-GATES. NAVI-GATES shall be free to license, assign, or otherwise
transfer rights in and to such Derivative Works and any inventions or
Works of Authorship relating to such Derivative Works to any third
party without notice to SHARP.
7.9 No Other Assignments or Encumbrances. Neither SHARP nor NAVI-GATES
shall assign, mortgage, license, or grant a security interest in any
Invention or Work of Authorship Relating to the Project Code which
would tend to hinder the other party in its exercise of license rights
granted under this Agreement.
SECTION 8
REPRESENTATIONS AND WARRANTIES BY NAVI-GATES
NAVI-GATES makes the following representations and warranties for the
benefit of SHARP, as a present and ongoing affirmation of facts in existence at
all times when this Agreement is in effect:
8.1 Ownership Rights. NAVI-GATES represents and warrants that (1) except as
provided in Section 12.3 hereof with respect to certain identified preexisting
works licensed to SHARP, it is and will be the sole author of all works employed
by NAVI-GATES in preparing any and all Deliverables; (2) it has and will have
full and sufficient right to assign or grant the rights and/or licenses granted
- 68 -
in the Deliverables pursuant to this Agreement; (3) all Deliverables, including
all preexisting works addressed in Section 12.3 hereof, have not been and will
not be published under circumstances that would cause a loss of copyright
therein; and (4) all Deliverables, including all preexisting works addressed in
Section 12.3 hereof, do not and will not infringe any patents, copyrights,
trademarks, or other intellectual property rights (including trade secrets),
privacy or similar rights of any third party, nor has any claim (whether or not
embodied in an action, past or present) of such infringement been threatened or
asserted, nor is such a claim pending, against NAVI-GATES (or, insofar as
NAVI-GATES is aware, any entity from which NAVI-GATES has obtained such rights).
8.2 Conformity, Performance, and Compliance. NAVI-GATES represents and
warrants (1) that all Deliverables shall be prepared in a workmanlike manner and
with professional diligence and skill; (2) that all Deliverables will function
on the machines and with operating systems for which they are designed; (3) that
all Deliverables will conform to the specifications and functions set forth in
the Exhibits relating thereto; and (4) that NAVI-GATES will perform all work
called for by this Agreement in compliance with applicable law.
SECTION 9
TERM AND TERMINATION
9.1 Term of Agreement. This Agreement shall be effective upon the date
specified at the beginning hereof and shall remain in force until terminated by
mutual written consent, unless otherwise terminated as provided herein.
9.2 Material Breach. In addition to the provision authorizing termination
hereunder, either party will have the right to terminate this Agreement because
of a material breach of the Agreement by the other party which has not been
cured sixty (60) business days after the date that the terminating party has
notified the other party of the breach and advised the other party of its
intention to terminate this Agreement if the breach remains uncured.
9.3 Survival. In the event of any termination of this Agreement, Sections
8 and 12 through 18 hereof shall survive and continue in effect and shall inure
to the benefit of and be binding upon the parties and their legal
representatives, heirs, successors, and assignees.
SECTION 10
SERVICE AND MAINTENANCE
Unless otherwise agreed under the terms of a separate Service and Maintenance
Agreement, SHARP shall be responsible for all service and maintenance related to
the Project Code once such Code has been delivered and accepted by NAVI-GATES.
SECTION 11
TRAINING
Upon delivery and acceptance of the Project Code, NAVI-GATES shall provide
SHARP with five (5) Days of training at SHARP's principal office, or such other
location as may be mutually agreed upon by both parties. Provided, however,
that SHARP shall reimburse NAVI-GATES for NAVI-GATES'S reasonable expenses
incurred with respect to the provision of such training, including, without
limitation, expense for travel, lodging and food.
- 69 -
SECTION 12
YEAR 2000 WARRANTY
Provided that all date data provided to the Programs is in full 4 digit
year format, NAVI-GATES warrants that the Project Code as delivered to SHARP:
(i) has been designed to be year 2000 compliant, which shall include, as an
illustration but not a limitation, date data century recognition, and
calculations that accommodate same and multi-century formulae and date values;
(ii) operates or will operator during in accordance with the specifications
listed in Exhibit A hereto prior to, during and after the calendar year 2000 AD;
and (iii) shall not end abnormally or provide invalid or incorrect results as a
result of date data, specifically including date data which represents different
centuries or more than one century. NAVI-GATES does not warrant century date
compliance for third party software that is or may be used in conjunction with
the Project Code, including database and operating systems vendors, and
NAVI-GATES is not responsible for any non-compliance to the extent caused by
hardware, third party software. NAVI-GATES is solely responsible for all system
integration and testing of the Project Code in a fully year 2000-compliant
operating environment, including all hardware, systems software, databases,
network environment, and other interoperating components.
SECTION 13
LIMITATION OF REMEDIES; WARRANTY
EXCEPT AS EXPRESSLY PRVIDED HEREIN, NAVI-GATES SHALL HAVE NO LIABILITY TO
SHARP FOR ANY CLAIM, LOSS OR DAMAGE CAUSED OR ALLEGED TO BE CAUSED DIRCTLY,
INDIRECTLY, INCIDENTALLY OR CONSEQUENTIALLY BY THE PROJECT CODE, BY ANY
INADEQUACY THEREOF OR DEFICIENCY OR DEFECT THEREIN, BY ANY INCIDENT WHATSOEVER
IN CONNECTION THEREWITH, ARISING IN STRICT LIABILITY, NEGLEGENCE OR OTHERWISE,
OR IN ANY WAY RELATING TO OR ARISING OUT OF THIS AGREEMENT EVEN IF NAVI-GATES
HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH CLAIM, LOSS OR DAMAGE, EXCEPT FOR
FAILURE TO DELIVER THE PROJECT CODE, IN WHICH EVENT NAVI-GATES'S LIABILITY SHALL
BE LIMITED TO THE PAYMENTS ACTUALLY HERETOFORE PAID TO NAVI-GATES BY SHARP
HEREUNDER. In no event will NAVI-GATES be liable for any damages arising from
any claim against SHARP by any other party, including, but not limited to
Customers. NAVI-GATES MAKES NO EXPRESS OR IMPLIED WARRANTIES OF ANY KIND,
INCLUDING THOSE OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE OR USE
WITH RESPECT TO THE PROJECT CODE OR ANY OTHER MATTER HEREIN AND EXPRESSLY
DISCLAIMS THE SAME.
SECTION 14
CONFIDENTIALITY RESTRICTIONS
a. Confidential Information. Documentation and information (including
orally or visually disclosed information) is "Confidential
Information" for the purposes of this Section 14 if (a) it is
designated as confidential or proprietary, by letter, stamp or legend;
(b) it forms part or the whole of the source code for the Project
Code; or (c) the disclosing party, at the time of disclosure, verbally
indicates that such disclosure is confidential and within ten (10)
business Days of such disclosure, confirms by notice in writing to the
receiving party that such disclosure is confidential. Confidential
Information shall not include information defined as Confidential
Information about which the receiving party can conclusively
establish: (i) was in the possession of the receiving party at the
time of disclosure; (ii) prior to or after the time of disclosure
becomes public knowledge without the act or omission of the party to
whom it was disclosed; (iii) is disclosed to the receiving party by a
third party under no legal obligations to maintain the confidentiality
of such information; or (iv) was independently developed by the
receiving party without reference to the Confidential Information of
the disclosing party. All such Confidential Information shall be
treated as confidential by the receiving party and its employees and
shall not be disclosed by the receiving party without the disclosing
party's prior written consent. However, the receiving party may
disclose Confidential Information of the disclosing party in
- 70 -
accordance with judicial or other governmental order, provided the
receiving party shall give the disclosing party's Confidential
Information, shall, if requested, assist the disclosing party in
obtaining a restrictive order to request confidential treatment or
prevent such disclosure, and shall comply with any applicable
protective order or equivalent. For the purposes of certainty, the
terms of this Agreement, including the financial terms shall be
maintained in confidence by both parties.
b. Treatment of Confidential Information. Neither party shall in any way
duplicate All or any part of the other party's Confidential
Information, except in accordance with the terms and conditions of
this Agreement. Each party shall have an appropriate agreement with
each of its employees, contractors and agents having access to the
other party's Confidential Information sufficient to enable that party
to comply with all terms of this Agreement. Each party agrees to
protect the other's Confidential Information with the same standard of
care and procedures which it uses to protect its own trade secrets and
confidential or proprietary information of like importance and, in any
event, shall adopt or maintain procedures reasonably calculated to
protect such Confidential Information. In no event shall such a
standard be less than a reasonable degree of care.
c. Further Treatment of Confidential Information. Each party agrees to
hold the other party's Confidential Information in trust and
confidence for such party and not use same other than as expressly
authorized under this Agreement. Each party agrees not to disclose any
such Confidential Information without the prior written consent of the
other, to anyone other than that party's employees who have a need to
know same to carry out the rights granted hereunder.
d. Action to Protect. Each party shall promptly report to the other any
actual or suspected violation of the terms of this Section, and shall
take all reasonable steps to prevent, control or remedy such
violation.
SECTION 15
B. MUTUAL REPRESENTATIONS
Each party hereby represents and warrants as follows:
a. Title. That it has all permissions consents, licenses, and
authorizations necessary to enter into this Agreement and to carry out
the transactions that are the subject of this Agreement, including,
without limitation, appropriate corporate authority and all licenses
and consents required from third parties.
b. No Conflict. That, to the best of its knowledge, the products and
services that are the subject of this Agreement are not subject to any
pending or threatened legal claims or legal causes of action,
including, without limitation, any pending or threatened legal causes
or claims relating to the alleged infringement of the proprietary
rights of others or the alleged failure of the relevant party to
satisfy its obligations to creditors.
- 71 -
SECTION 16
INDEMNIFICATION
Each party will and hereby does agree to indemnify, defend, and hold the
other party, and the owners, shareholders, officers, directors, employees,
contractors, agents, and representatives of the other party, harmless from all
liabilities, damage or remedial or punitive awards of any kind, costs and fees
of any kind (including costs of defense and reasonable attorney fees), claims or
causes of any kind (whether pending or threatened), arising from, resulting from
or relating to: (1) its own conduct, including conduct of its owners,
shareholders, officers, directors, employees, contractors, agents, and
representatives, unless such conduct is carried out at the express written
instruction of other party; (2) its own products or services, but only to the
extent that such products are not modified by the other party; (3) any breach of
a warranty or representation given in this Agreement; and, (4) any material or
information it provides to the other party, but only so long as the material or
information is used, disclosed, and maintained consistent with the terms of this
Agreement or any express written instructions provided at the time the other
party receives the information or material at issue; and provided that the other
party provides prompt written notification to the defending party of any action
requiring indemnification. Without limiting the generality of the foregoing,
NAVI-GATES'S entire liability under this Agreement shall in no event exceed the
amounts paid to it by SHARP.
SECTION 17
PARTNERSHIP DISCLAIMER
Any intention to create a partnership, as such term is defined in Section
761 of the Internal Revenue Code of 1986, among any or all of the parties is
disclaimed. Any party may file on behalf of all parties an election under
Section 761 of the Internal Revenue Code of 1986 that Subchapter K of Chapter I
of Subtitle A of the Internal Revenue Code of 1986 shall not be applicable to
the parties. In no event is the relationship between the parties hereto to be
deemed to be a partnership under any applicable law.
SECTION 18
MISCELLANEOUS
a. Entire Agreement. This Agreement represents the entire understanding
and agreement between the parties with respect to the subject matter
hereof, and supersedes all other negotiations, understandings and
representations (if any) made by and between such parties.
b. Amendments. The provisions of this Agreement may not be amended,
supplemented, waived or changed orally, but only by a writing signed
by the party as to whom enforcement of any such amendment, supplement,
waiver or modification is sought and making specific reference to this
Agreement.
c. Assignments. No party shall assign his or its rights and/or
obligations hereunder without the prior written consent of each other
party to this Agreement, except to a subsidiary in which case such
assignment will not release the assignor from its obligations
hereunder without the prior written consent of the other party.
d. Further Assurances. The parties hereby agree from time to time to
execute and deliver such further and other transfers, assignments and
documents and do all matters and things which may be convenient or
necessary to more effectively and completely carry out the intentions
of this Agreement.
e. Binding Effect. All of the terms and provisions of this Agreement,
whether so expressed or not, shall be binding upon, inure to the
benefit of, and be enforceable by the parties and their respective
legal representatives, successors and permitted assigns.
- 72 -
f. Notices. All notices, requests, consents and other communications
required or permitted under this Agreement shall be in writing
(including telex and telegraphic communication) and shall be (as
elected by the person giving such notice) hand delivered by messenger
or courier service, telecommunicated, or mailed (airmail if
international) by registered or certified mail (postage prepaid),
return receipt requested, addressed to:
If to NAVI-GATES:
Xxxxxx X. Xxxxxxx
NAVI-GATES Corporation
000 Xxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx, 00000
If to SHARP:
Xxxxxx XXXXX, President
SHARP Technology, Inc.
0000 Xxxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
XXXXXX@XXXXXxxxxxxxxxx.xxx
--------------------------
Or to such other address as any party may designate by notice
complying with the terms of this Section. Each such notice shall be
deemed delivered (a) on the date delivered if by personal delivery,
(b) on the date telecommunicated if by telegraph, (c) on the date of
transmission with confirmed answer back if by telex, and (d) on the
date upon which the return receipt is signed or delivery is refused or
the notice is designated by the postal authorities as not deliverable,
as the case may be, if mailed.
g. Headings. The headings contained in this Agreement are for convenience
of reference only, and shall not limit or otherwise affect in any way
the meaning or interpretation of this Agreement.
h. Severability. If any part of this Agreement or any other Agreement
entered into pursuant hereto is contrary to, prohibited by or deemed
invalid under applicable law or regulation, such provision shall be
inapplicable and deemed omitted to the extent so contrary, prohibited
or invalid, but the remainder hereof shall not be invalidated thereby
and shall be given full force and effect so far as possible.
i. No Waiver. The failure or delay of any party at any time to require
performance by another party of any provision of this Agreement, even
if known, shall not affect the right of such party to require
performance of that provision or to exercise any right, power or
remedy hereunder, and any waiver by any party of any breach of any
provision, a waiver of the provision itself, or a waiver of any right,
power or remedy under this Agreement. No notice to or demand on any
party in any case shall, of itself, entitle such party to any other or
further notice or demand in similar or other circumstances.
j. Jurisdiction and Venue. Any claim, controversy or dispute between the
Parties', their Affiliates, agents, employees, officers, or directors
("Dispute") shall be conducted in the City and State of the party
against whom the action is brought, and the laws of such state shall
govern the construction and interpretation of the Agreement.
k. Attorney's Fees. If any legal action or other proceeding is brought
for the enforcement of this Agreement, or because of an alleged
dispute, breach, default or misrepresentation in connection with any
provisions of this Agreement, the successful or prevailing party or
parties shall be entitled to recover reasonable attorneys fees, court
costs and all expenses even if not taxable as court costs (including,
without limitation, all such fees, costs and expenses incident to
appeals), incurred in that action or proceeding, in addition to any
other relief to which such party or parties may be entitled.
- 73 -
l. Remedies Cumulative. No remedy herein conferred upon any party is
intended to be exclusive of any other remedy, and each and every such
remedy shall be cumulative and shall be in addition to every other
remedy given hereunder or now or hereafter existing at law or in
equity or by statute or otherwise. No single or partial exercise by
any party of any right, power or remedy hereunder shall preclude any
other or further exercise thereof.
m. Export Limitations. In the event of any distribution by SHARP of
Project Code outside the United States, SHARP agrees to comply with
all applicable United States Federal and State laws, rules and
regulations.
n. Counterparts. This Agreement may be executed in one or more
counterparts, each, which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
o. Incorporation of Exhibits. All Exhibits attached hereto shall be
deemed as part of this Agreement, and all capitalized terms used in
such Exhibits shall have the same meanings ascribed thereto in this
Agreement.
p. Force Majeure. Either party shall be excused from delays in performing
or from its failure to perform hereunder to the extent that such
delays or failures result from causes beyond the reasonable control of
such party; provided that, in order to be excused from delay or
failure to perform, such party must act diligently to remedy the cause
of such delay or failure.
q. Required Approvals. Where agreement, approval, acceptance, or consent
by either party is required by any provision of this Agreement, such
action shall not be unreasonably delayed or withheld.
r. Authority of NAVI-GATES. NAVI-GATES has the sole right and obligation
to supervise, manage, contract, direct, procure, perform, or cause to
be performed all work to be carried out by NAVI-GATES hereunder unless
otherwise provided herein.
IN WITNESS THEREOF, SHARP and NAVI-GATES have caused this Agreement to be
signed and delivered by their duly authorized officers, all as of the date first
herein above written.
SHARP TECHNOLOGY INC.
/s/ Xxxxxx Xxxxx
----------------------------------
By: Xxxxxx XXXXX
Title: President & CEO
Date: June 25, 1999
THE NAVI-GATES CORPORATION
/s/ Xxxxxx Xxxxxxx
----------------------------------
By: Xxxxxx X. Xxxxxxx
Title: General & Managing Partner
Date: June 25, 1999
- 74 -
