EXHIBIT 10.19
DEVELOPMENT AND DISTRIBUTION AGREEMENT
THIS DEVELOPMENT AND DISTRIBUTION AGREEMENT ("Agreement") is
made and entered into as of May ___, 1999 ("Effective Date") by and between
BE INCORPORATED, a California Corporation with its principal offices at 000
Xx Xxxxxx Xxxx, Xxxxx 000, Xxxxx Xxxx, Xxxxxxxxxx 00000, X.X.X. ("Be"), and
STRATA _______, a _______ Corporation with its principal offices at 0 Xxxx
Xxxxxx, Xx. Xxxxxx, Xxxx 00000, X.X.X. ("Strata").
WHEREAS, Be has developed the Be digital media operating system
known as BeOS-Registered Trademark- ("BeOS"); and
WHEREAS, Strata has developed the Strata 3-D modeling,
rendering and animation software application known as StudioPro and the
Strata video editing software application known as VideoShop (collectively,
the "Strata Products"); and
WHEREAS, Be and Strata desire to work together as set forth in
this Agreement to modify the Strata Products so as to port them to run on
BeOS (the "Modified Products") and for Strata then to market, distribute,
maintain and support the Modified Products.
WHEREAS, concurrently with the execution of this Agreement, Be
and Strata are entering into Be's standard BeDepot Online Distribution
Agreement (the "Distribution Agreement") pursuant to which Be will sell
copies of the Modified Products for BeOS to end users;
NOW, THEREFORE, in consideration of the foregoing premises and the
covenants contained herein, the parties hereby agree as follows:
1. DEVELOPMENT EFFORT
1.1 DESCRIPTION OF THE DEVELOPMENT EFFORT. Subject to the terms
and conditions of this Agreement, Be will, with the assistance of Strata,
perform development and engineering services to port the Strata Products to
BeOS (the "Services") as more fully described in the statement of work
attached as EXHIBIT A hereto ("Statement of Work"). Such Statement of Work
may be amended or modified by supplementary work orders agreed to by both
parties hereto and attached to the Statement of Work, and thereafter the
Services will be deemed to include the services described in such
supplementary work orders.
1.2 BE'S DEVELOPMENT OBLIGATIONS. Be will use commercially
reasonable efforts to meet the schedules and time of performance for the
Services as set forth in the Statement of Work. The manner and means used by
Be to perform the Services are in the sole discretion and control of Be
subject to the provisions below.
(a) Be will provide requisite engineering personnel and
such other development resources as may be required to perform and complete
its portion of the Services in accordance with the terms and conditions of
this Agreement/schedule set forth in the Statement of Work.
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(b) Be will make available to Strata one (1)
BeOS-compatible Intel Pentium based development environment for use in
testing and development assistance.
(c) Be will provide basic QA and matrix testing of the
Modified Products.
(d) Be will deliver to Strata the Modified Products as set
forth on the Statement of Work, along with the information, materials, and
technology that constitutes the modifications made to the Strata Products
that make up the Modified Products.
1.3 STRATA'S DEVELOPMENT ASSISTANCE OBLIGATIONS.
(a) Strata will designate a lead developer technical
support engineer that will provide commercially reasonable priority support
to Be for the duration of the Services; provided however, that Be
acknowledges and agrees to use its own commercially reasonable efforts to
provide the Services with minimal requests for Strata assistance. Strata will
participate in the final testing/QA of the Modified Products as more fully
described in EXHIBIT A, and will use its best efforts to provide adequate and
useful feedback to Be during the porting effort to ensure the Modified
Products will meet Strata's functional specifications in the acceptance stage
of this Agreement.
(b) Strata will provide at least three (3) days of
training to an engineer to be designated by Be for each of the Strata
Products.
(c) Strata will develop product documentation, help files
and examples, including any BeOS specific versions or addenda for the
Modified Products in the languages stated in the Statement of Work and in
accordance with the schedule set forth in the Statement of Work.
(d) Strata agrees to provide Be with the Strata Products
(including all related source code, libraries, object files and other
necessary components in machine readable formats), along with such other
information, materials, and technology owned or controlled by Strata as Be
reasonably requires to meet its obligations as set forth in this Agreement
("Strata Licensed Technology"). In connection with Be's porting effort
described herein, Strata hereby grants to Be, during the period whereby Be is
providing the Services, a royalty-free, non-exclusive, license to use,
reproduce, modify, create derivative works from, and otherwise practice the
Strata Licensed Technology under all Strata IP Rights (as defined in Section
5) covering such Strata Licensed Technology, to allow Be to complete the
Services described herein. Strata hereby agrees that Be may sublicense the
foregoing rights to and fulfill its obligations under Section 1.2 above
through a contractor; provided that such contractor must first be approved by
Strata (which approval may not be unreasonably withheld or delayed) and such
contractor executes a non-disclosure agreement including provisions at least
as protective of Strata's Confidential Information as those set forth herein.
As between the parties, Strata will retain all ownership rights in and to the
Strata Licensed Technology, and Be will gain no rights in or to the Strata
Licensed Technology except for the license set forth above.
2. DELIVERABLES AND ACCEPTANCE
2.1 DELIVERY. In performing the Services, Be shall design and
develop those software programs, interfaces and other deliverables
("Deliverables") as required in the Statement of Work. Be shall use
commercially reasonable efforts to ensure that the Deliverables are completed
and delivered to Strata in accordance with the schedule
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set forth in the Statement of Work and that such Deliverables conform to the
specifications set forth in EXHIBIT B hereto ("Specifications") in all
material respects.
2.2 ACCEPTANCE. Within 10 days of receiving a Deliverable, Strata
shall determine whether such Deliverable conforms to the Specifications. If
Strata reasonably determines that such Deliverables do not conform to the
Specifications in all material respects, Strata shall promptly notify Be in
writing that such Deliverables are not accepted and specifically setting
forth the non-conformity(ies). The parties shall then mutually determine the
corrective action required to bring the Deliverable into conformance with the
Specifications, and additional testing on previously non-conforming
Deliverables shall be completed as determined by the parties.
3. REPRODUCTION, PACKAGING AND MARKETING
3.1 BE MARKETING AND PROMOTION OBLIGATIONS. Be will promote the
Modified Products, at no charge to Strata, through various efforts, including
(i) Web-based marketing, (ii) allowance of Strata's participation in Be
booths at appropriate and mutually agreed upon trade shows and demonstrations
at Be developer conferences, (iii) provision of disk space for Strata
demonstrations on BeOS demonstration CDs, with approval by Be at its sole
discretion, (iv) access to Be user lists, through third party bonded mailing
houses, for direct mailings promoting the Modified Products; (v) allowance of
Strata's participation, as determined by Be, in Be's public relations
efforts, and (vi) introductions of Strata to appropriate Be OEMs.
3.2 STRATA REPRODUCTION AND MARKETING OBLIGATIONS. Upon acceptance
of the Modified Products by Strata, Strata will reproduce, package, promote
and market the Modified Products to end users. Strata agrees to promote and
market the Modified Products with at least as much effort as Strata promotes
and markets the Windows and Macintosh versions of the Strata Products.
3.3 EXECUTION OF BEDEPOT AGREEMENT. Upon acceptance of the
Modified Products by Strata, Strata shall enter into a BeDepot sales
agreement with Be substantially in accordance with the form attached hereto
as EXHIBIT C.
3.4 ANNOUNCEMENT. Be and Strata will work together to announce,
pursuant to a mutually agreed upon press release, the development efforts
hereunder. In no instance will Strata otherwise disclose the terms of this
Agreement except as required to Strata's accountants and legal counsel.
4. CONSIDERATION AND EXPENSES
4.1 RECOUPMENT OF DEVELOPMENT COSTS. Until such time as Be has
fully recouped the all costs incurred by Be, including but not limited to
engineering costs, towards its development obligations hereunder or until Be
has received $110,000 from Strata under this Section 4.1, whichever is
earlier, Strata shall pay to Be fifty percent (50%) of revenue received by
Strata from distribution or license for use of the Modified Products, less
reasonable costs and allowances, including product packaging, taxes and
returns.
4.2 RECORDS, REPORTS AND AUDITS. Strata shall maintain a complete,
clear, accurate record of, and provide such record with each recoupment
payment to Be: (a) the number, list price, revenue received by Be and the
recoupment amount due to Be for each copy of the Modified Products
distributed or licensed for use during the quarter, and (b) any other
information which may be required to determine whether Strata is paying the
correct recoupment
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amount hereunder. To ensure compliance with the terms of this Agreement, Be
shall have the right to conduct an inspection and audit of all the relevant
accounting and sales books and records of Strata during regular business
hours at Strata's offices with 15 days' prior written notice and in such a
manner as not to interfere with Strata's normal business activities. In no
event shall audits be made hereunder more frequently than every twelve (12)
months.
4.3 NO OTHER FEES. Except as stated in Section 4.1, each party
acknowledges and agrees that it shall not be entitled to any other monetary
fees from the other party for the performance of its obligations hereunder or
delivery of the Deliverables provided hereunder.
4.4 EXPENSES. Each party agrees that it shall be solely
responsible for all its own expenses, including but not limited to actual
travel and out-of-pocket expenses, incurred in connection with the
performance of its obligations hereunder.
4.5 TAXES. Strata shall be responsible for payment of all taxes or
charges, except for any taxes based solely on Be's net income, incurred or
assessed on the transfer of technology hereunder.
5. INTELLECTUAL PROPERTY RIGHTS
5.1 As used herein, the term "IP Rights" means recognized
protectable intellectual property, including: patents and applications,
copyrights, trademarks, trade secrets, mask works, industrial design rights,
know-how, methodologies, and any and all other legal rights protecting
intangible proprietary information. Examples of inventions, innovations, and
developments that may contain protectable IP Rights include: formulas,
algorithms, methods, processes, databases, computer networks and their parts,
computer languages, scripts, computer programs and their documentation,
encoding techniques, articles, writings, works of authorship, and
improvements.
5.2 In connection with the performance of the Services or other
obligations hereunder, each party will exercise and utilize certain of its
own IP Rights. Except as otherwise set forth herein, neither this Agreement,
nor the provision of Services hereunder, will give either Be or Strata any
ownership interest in or rights to the existing IP Rights of the other party.
Except as otherwise set forth herein, all IP Rights that are owned or
controlled by a party at the commencement of this Agreement shall remain
under the ownership or control of such party throughout the term of this
Agreement and thereafter.
5.3 As between the parties and subject to Section 5.4, Strata will
retain sole ownership of all rights to any and all Innovations, whether or
not jointly conceived, and IP Rights arising therefrom, that are intended, in
the application thereof, to be incorporated into the Modified Products. To
perfect ownership of Strata IP Rights, Be agrees to and hereby does assign to
Strata all rights Be may have in those Innovations to be owned by Strata as
provided in this Section 5.3, and at Strata's request and expense Be will
assist and cooperate with Strata in all reasonable respects, and execute all
documents and, subject to reasonable availability, give testimony and take
all further acts reasonably necessary to acquire, transfer, maintain, and
enforce such Strata IP Rights.
5.4 As between the parties, Be will retain sole ownership of all
rights to all Innovations, whether or not jointly conceived, and all IP
Rights arising therefrom, that consist of generic software objects,
programming code, interfaces or drivers intended to be integrated with or
incorporated in BeOS to run the Modified Products, or which are generally
applicable to software applications ported to BeOS (hereinafter, the "Be
Licensed Modifications"). In
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light of Be's ownership in the Be Licensed Modifications and provided that
Strata continues to comply with the terms and conditions of this Agreement,
Be hereby grants to Strata a royalty-free, non-exclusive, license to use,
reproduce and distribute (including through multiple tiers) and otherwise
practice the Be Licensed Modifications under all Be IP Rights (as defined in
Section 5.1) covering such Be Licensed Modifications.
5.5 Subject to each party's compliance with the confidentiality
provisions of this Agreement, nothing in this Agreement will restrict or
limit either party from engaging in similar software development arrangements
with any other entity in any industry, both during and after the term of this
Agreement.
6. MAINTENANCE, SUPPORT AND WARRANTIES
6.1 MAINTENANCE AND SUPPORT OBLIGATIONS. Strata will be solely
responsible for all, and, except as otherwise expressly set forth in this
Agreement, Be will have no obligation to provide any, maintenance or support
services to Strata or any of Strata's distributors, resellers or customers
with respect to the Deliverables or the Modified Products. Further, Strata
agrees that it will not refer any of its representatives, distributors,
resellers or customers to Be for any help with any questions or problems
relating to the Deliverables or the Modified Products, unless Be has
expressly authorized Strata in writing to do so. Strata will maintain and
update the Modified Products so as to keep them current at all times with its
Windows and Macintosh counterparts.
6.2 WARRANTIES; DISCLAIMERS. Strata hereby represents and
warrants that the Strata Products will not infringe any IP Rights of any
third party. Both parties represent and warrant that it has full right and
power to enter into and fulfill this Agreement without the consent of any
third party. EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION, ALL DELIVERABLES
ARE PROVIDED TO THE OTHER PARTY ON AN "AS IS" BASIS AND WITHOUT ANY WARRANTY
OF ANY KIND. NEITHER PARTY WARRANTS THAT USE OF THE DELIVERABLES WILL BE
ERROR- FREE, SECURE OR UNINTERRUPTED. EACH PARTY AND ITS SUPPLIERS DISCLAIM
ALL EXPRESS AND IMPLIED WARRANTIES, INCLUDING THE IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, AND
NON-INFRINGEMENT OF THIRD PARTY RIGHTS.
7. INDEMNIFICATION.
7.1 BY BE. Be will indemnify, defend and hold harmless Strata, its
officers, directors, employees, sublicensees, assignees, customers and agents
from any and all claims, losses, liabilities, damages, expenses and costs
(including attorneys' fees and court costs) which result from a breach or
alleged breach of any representation or warranty set forth in Section 6 of
this Agreement (a "Claim"), provided that Strata gives Be written notice of
any such Claim and Be has the right to participate in the defense of any such
Claim at its expense.
7.2 BY STRATA. Strata will indemnify, defend and hold harmless Be,
its officers, directors, employees, sublicensees, assignees, customers and
agents from any and all claims, losses, liabilities, damages, expenses and
costs (including attorneys' fees and court costs) which result from a breach
or alleged breach of any representation or warranty set forth in Section 6 of
this Agreement (a "Claim"), provided that Be gives Strata written notice of
any such Claim and Strata has the right to participate in the defense of any
such Claim at its expense.
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8. TERM AND TERMINATION
8.1 This Agreement will commence on the Effective Date and, unless
terminated earlier pursuant to the terms of this Agreement, shall continue
for so long as Strata continues to market and distribute the Windows and/or
Macintosh versions of the Strata Products. (the "Term").
8.2 This Agreement may be terminated by either party upon thirty
(30) days' prior written notice if the other party materially breaches any
term hereof and the breaching party fails to cure such breach within the
30-day period.
8.3 Each party's rights and obligations under Sections 4, 5, 7, 8,
9, 10 and 11 of the Agreement will survive termination or expiration of the
Agreement. Within thirty (30) days after termination of this Agreement for
any reason, each party will return or destroy, at the direction of the other
party, such other party's Confidential Information.
9. LIMITATIONS ON LIABILITY.
EXCEPT IN ANY INSTANCE OF A PARTY'S BREACH OF SECTION 7 OR 10, IN NO OTHER
EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER FOR LOSS OF PROFITS,
INTERRUPTION OF BUSINESS OR ANY OTHER SPECIAL, CONSEQUENTIAL, INCIDENTAL,
INDIRECT, PUNITIVE OR EXEMPLARY DAMAGES, HOWEVER CAUSED, WHETHER FOR BREACH
OF WARRANTY, BREACH OF CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHERWISE,
EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
10. CONFIDENTIALITY AND NON-USE
10.1 By virtue of this Agreement, each party hereto may disclose to
the other party information that is confidential or otherwise proprietary.
10.2 Subject to the exceptions listed below, a party's
"Confidential Information" will be defined as written, electronic, oral or
other form of information disclosed by the party to the other party under
this Agreement and clearly marked or otherwise clearly designated as
"confidential" or the equivalent. Oral information is deemed "Confidential
Information" if identified as such in writing by the disclosing party within
30 days following disclosure However, a party's Confidential Information will
not include any information that: (a) is or becomes a part of the public
domain through no wrongful act or omission of the other party; or (b) was in
the other party's lawful possession prior to the disclosure and had not been
obtained by the other party either directly or indirectly from the disclosing
party; or (c) is lawfully disclosed to the other party by a third party
without restriction on disclosure; or (d) is independently developed by the
other party by employees or agents without reference to the party's
Confidential Information.
10.3 Each party agrees, for the term of this Agreement and five (5)
years after its expiration or termination, to hold the other party's
Confidential Information in strict confidence, not to disclose such
Confidential Information to third parties not authorized by the disclosing
party to receive such Confidential Information, and not to use such
Confidential Information for any purpose except as expressly permitted
hereunder. Each party agrees to take reasonable steps to protect the other
party's Confidential Information to ensure that such Confidential Information
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is not disclosed, distributed or used in violation of the provisions of this
Agreement. The foregoing prohibition on disclosure of Confidential
Information will not apply to the extent certain Confidential Information is
required to be disclosed by the receiving party as a matter of law or by
order of a court, provided that the receiving party uses reasonable efforts
to provide the disclosing party with prior notice of such obligation to
disclose and reasonably assists in obtaining a protective order therefor.
10.4 As used herein, the term "Residuals" means information in
non-tangible form that is inadvertently retained by persons who have had
access, as authorized in this Agreement, to the other party's technology,
including ideas, concepts, know-how or techniques contained therein.
"Residuals" shall not include ideas, concepts, know-how or techniques which
such persons know or should have reason to believe were acquired from access
to such other party's technology. Each party acknowledges and agrees that,
notwithstanding anything to the contrary in Section 10.3 or elsewhere in this
Agreement, it and its employees may utilize for any lawful purpose any
Residuals in connection with the performance of the obligations under this
Agreement or access to the other party's Confidential Information.
11. GENERAL
11.1 INDEPENDENT CONTRACTOR. Each party hereto is an independent
contractor to the other party, and nothing contained in this Agreement will
be construed to create or imply a joint venture, partnership, principal-agent
or employment relationship between the parties. Neither party may take any
action or permit any action to be taken on its behalf which purports to be
done in the name of or on behalf of the other party and neither party will
have any power or authority to bind the other party to assume or create any
obligation or responsibility express or implied on the other party's behalf
or in its name.
11.2 NOTICES. All notices, consents, waivers, and other
communications intended to have legal effect under this Agreement must be in
writing, must be delivered to the other party at the address set forth at the
top of this Agreement by personal delivery, certified mail (postage
pre-paid), or a nationally recognized overnight courier, and will be
effective upon receipt (or when delivery is refused). Each party may change
its address for receipt of notices by giving notice of the new address to the
other party.
11.3 INJUNCTIVE RELIEF. It is understood and agreed that,
notwithstanding any other provision of this Agreement, any material breach of
this Agreement will cause irreparable damage for which recovery of money
damages would be inadequate, and that the non-breaching party will therefore
be entitled to seek timely injunctive relief to protect such party's rights
under this Agreement in addition to any and all remedies available at law.
11.4 FORCE MAJEURE. Neither party shall be liable for any loss,
damage, or penalty arising from delay due to causes beyond its reasonable
control. Such delay shall be excused during the continuance of such delay and
the period of performance shall be extended to such extent as necessary to
allow the party to perform after the cause of such delay has ceased.
11.5 EXPORT ADMINISTRATION. If any Deliverables are for use
outside the U.S.A., each party agrees to comply fully with all relevant
regulations of the U.S. Department of Commerce and with the U.S. Export
Administration Act to assure that such are not exported, directly or
indirectly, by such party in violation of United
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States Law and to comply fully with any other regulations or laws relating to
such export or import into another country.
11.6 GOVERNING LAW AND VENUE. This Agreement will be governed by
and interpreted in accordance with the laws of the State of California as
such laws apply to contracts made between California residents to be
performed entirely within California. Any suit, action or proceeding arising
from or relating to this Agreement must be brought in a federal court in the
Northern District of California or in state court in Santa Xxxxx County,
California, and each party irrevocably consents to the jurisdiction and venue
of any such court in any such suit, action or proceeding.
11.7 WAIVER. The failure of either party to require performance by
the other party of any provision of this Agreement will not affect the full
right to require such performance at any time thereafter; nor will the waiver
by either party of a breach of any provision of this Agreement be taken or
held to be a waiver of the provision itself as to any other breaches thereof.
11.8 SEVERABILITY. If any provision of this Agreement is
unenforceable or invalid under any applicable law or is so held by applicable
court decision, such unenforceability or invalidity will not render this
Agreement unenforceable or invalid as a whole, and such provision will be
changed and interpreted so as to best accomplish the objectives of such
unenforceable or invalid provision within the limits of applicable law or
applicable court decisions.
11.9 ASSIGNMENT. Neither this Agreement nor any rights or
obligations of either party under this Agreement may be assigned in whole or
in part without the prior written consent of the other party except in an
instance whereby such party assigns this entire Agreement in connection with
a merger or sale of all or substantially all of its business or assets. Any
attempted assignment in violation of the preceding sentence will be void.
This Agreement will bind and inure to the benefit of the respective
successors and permitted assigns of the parties.
11.10 FULL POWER. Each party warrants that it has full power to
enter into and perform this Agreement, and the person signing this Agreement
on such party's behalf has been duly authorized and empowered to enter into
this Agreement by their respective Board of Directors.
11.11 CONSTRUCTION. The section headings appearing in this
Agreement are inserted only as a matter of convenience and in no way define,
limit, construe, or describe the scope or extent of such section or in any
way affect this Agreement. Unless otherwise expressly stated, when used in
this Agreement the word "including" means "including but not limited to."
11.12 ENTIRE AGREEMENT AND AMENDMENT. This Agreement together with
the Exhibits completely and exclusively states the agreement of the parties
regarding its subject matter. It supersedes, and its terms govern, all prior
understandings, agreements, or other communications between the parties, oral
or written, regarding such subject matter. This Agreement may be executed in
counterparts and may be amended only in a document signed by both parties.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the Effective Date.
STRATA, INC: BE INCORPORATED:
By: By:
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Name: Name:
-------------------------- ---------------------------
Title: Title:
------------------------- --------------------------
Date: Date:
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EXHIBIT A
STATEMENT OF WORK
DATED:
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INITIALED:
PROJECT
Development of versions of the Strata Products StudioPro and VideoShop ported
to BeOS.
STRATA LICENSED TECHNOLOGY
StudioPro
VideoShop
SCHEDULE
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DELIVERABLE SCHEDULED DELIVERY DATE
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TESTING/QA PROCEDURES
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EXHIBIT B
SPECIFICATIONS
[to be attached]
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EXHIBIT C
BEDEPOT SALES AGREEMENT
[to be attached]
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