Exhibit 10.7
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STRATEGIC ALLIANCE AGREEMENT
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This STRATEGIC ALLIANCE AGREEMENT (this "Agreement") is entered into by and
between Synthonics Technologies, Inc., a Utah Corporation ("Synthonics") and
Knowledge LINK, a California Company ("KL") with respect to the terms of a
strategic working relationship between the two companies.
RECITALS
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A. Whereas, Synthonics represents that it is a provider of software tools
for the generation, of 3D content, and that these tools are collectively
referred to as Rapid Virtual RealityTM (RVRTM),
B. Whereas, Synthonics represents that it has developed and patented the
technology known as Rapid Virtual Reality(TM),
C. Whereas, Synthonics desires to make its RVR(TM) technology available for
use by KL on a non-exclusive basis,
D. Whereas, KL represents that it is a provider of custom electronic
commerce solutions,
E. Whereas, KL represents that its customers are comprised of leading
consumer electronics, home appliance, home automation, and healthcare
manufacturers,
F. Whereas, KL desires to integrate Synthonics' RVR(TM) technology into its
custom electronic commerce solutions,
G. Whereas, both parties desire to establish a formal working relationship
between the two companies that is focused on servicing the needs of the
electronic commerce industry.
AGREEMENT
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NOW, THEREFORE, based upon the foregoing and in consideration of the
covenants, agreements, warranties and representations hereinafter set forth, the
parties hereto hereby agree as follows:
1. Definitions:
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1.1 Rapid Virtual Reality(TM) (RVRTM) A suite of 3D software tools
consisting of Optical Tape Measure, Camera Parameter Tracker, 3D Model Maker,
Single Object Viewer, Multi-Object Viewer, Anaglyph Generator, 3D Stereo Movie
Maker, File Converter, and M-PEG Converter.
1.2 Content All imagery, including two dimensional (2D) and three
dimensional (3D), required for electronic catalogs and storefronts developed by
KL.
1.3 Preferred Source A pre-selected supplier of a specifically identified
product or service for which competitive bids are not required. To retain the
preferred source supplier status, a supplier must remain competitive.
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2. Operating Relationship.
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2.1 Synthonics grants KL a license to incorporate or to include any of the
RVR(TM) software tools, defined above in Paragraph l.l, as part of electronic
commerce solutions that it provides to its customers.
2.2 KL designates Synthonics as its preferred source for content to be used
in any of the electronic catalogs or storefronts that it develops for its
customers.
2.3 Synthonics agrees to make reasonable changes to the RVR(TM) suite of
tools as requested by KL.
2.4 Synthonics shall provide support services to KL as its "in-house" 3D
technical resource.
2.5 The use of its RVR(TM) tools by KL is on a non-exclusive basis and
Synthonics is free to make its RVR(TM) tools available to other entities
operating in the electronic commerce or any other industry.
2.6 Synthonics grants KL the right of first refusal relative to the
exclusive use of the RVR(TM) tools for the electronic commerce industry. Prior
to the signing of any agreement for the use of its RVR(TM) tools with any
company that competes with KL, Synthonics shall allow KL to exercise its right
to procure the exclusive use of RVR(TM) for the electronic commerce industry.
The value of an exclusive use agreement shall be determined by Synthonics at the
time of the intended exercise of this right by KL.
3. Payment Terms.
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3.1 Synthonics shall be paid a license fee of one hundred dollars ($100)
per month for each website produced by KL that contains any of the tools
included in the RVR(TM) suite of tools. A cap of one thousand dollars ($1,000)
per month applies to contracted CEDIA members only.
3.2 Synthonics shall be paid at the rate it quotes for all content that it
generates for KL. A progress schedule of payments shall be utilized for all work
performed in this manner.
3.3 Synthonics shall be paid at the rate of fifty dollars ($50) per hour
for all maintenance support required by KL or its customers. Synthonics shall
provide a weekly summary log to KL of the hours it has invested in maintenance.
3.4 Synthonics shall be paid at the rate it quotes for any customization of
its RVR(TM) tools that is required by KL.
3.5 Synthonics shall be financially responsible for incorporating "fixes"
to any of its RVR(TM) tools. KL agrees, as much as possible, to accumulate fix
requests so as to be included as a general update to a specific RVR(TM) tool.
3.6 License payments payable to Synthonics by KL are due at the end of
every month in which they were incurred. All other payments to Synthonics by KL
are due upon receipt of an invoice from Synthonics.
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4. Length of Agreement.
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4.1 This Agreement shall be in effect for twelve (12) months from the date
of signing by both parties. It is the intent of both parties to continue their
Strategic Alliance beyond twelve (12) months. Therefore, it is both parties
intent to re-negotiate the terms of this Agreement on or before the twelfth
month anniversary of this Agreement.
5. Infringement.
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5.1 Synthonics hereby authorizes KL, at its option, to bring independent
infringement actions, including law suits, against third-party infringers of the
RVR(TM) on behalf of itself and/or Synthonics.
5.2 Synthonics agrees to defend and hold KL harmless in case of an
infringement action brought by a third party against KL for any and all
utilization of the RVR(TM) technology by KL.
5.3 KL agrees to defend and hold Synthonics harmless in case of an
infringement action brought by a third party against KL for any and all
utilization of technology and content not directly provided by Synthonics.
Further, KL agrees to defend and hold Synthonics harmless for any liability
claim made by its clients or its client's customers.
6. Confidentiality.
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6.1 Synthonics and KL agree and understand that the RVR(TM) technology
licensed hereunder and the KL technology to which Synthonics may be exposed to
contains certain information that is confidential and proprietary which the
parties expressly agree to retain in strictest confidence and to use only in
conjunction with and pursuant to the xxxxx of this Agreement. The parties
further agree to keep all protected technology, source code and all related
documentation confidential and not to disclose such information to any third
party. Both Synthonics and KL shall require any sub-contractor and each of their
employees granted access to the confidential information to execute
confidentiality agreements under which the third party and their employee agree
to limit their use of the confidential information to not disclose or make any
other use of the source code and/or related documentation except for purposes
expressly authorized by Synthonics or KL. The parties shall further require such
third parties to return all source code and documentation with respect to the
confidential information after the third party has completed the project
involving the confidential information for which they were hired.
6.2 The parties obligations with respect to such confidential information
shall survive the termination of this Agreement for a period of three years.
Notwithstanding anything to the contrary in Section 6.1, both Synthonics and KL
shall not be prohibited frown using or disclosing information which:
(a) is already available to the public as of the date of this
Agreement;
(b) becomes publicly available through no fault of Synthonics (or the
fault of its employees or agents) or KL (or the fault of its employees or
agents);
7. Termination.
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7.1 This Agreement and the license granted hereunder shall terminate if
either party commits an act of or is subject to a Default. A "Default" means any
one or more of the following events:
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(a) The nonpayment of any amount due hereunder, or
(b) a material breach of a term or condition of this Agreement.
7.2 Upon the occurrence of a Default, the non-defaulting party shall
provide written notice to the other party of the Default and the defaulting
party shall have fifteen (15) days from the defaulting party's receipt of notice
of Default to cure the same. If the defaulting party shall not effect such cure
then this Agreement shall terminate. The parties' rights as set forth in this
Section 7 are cumulative and in addition to any other rights the parties may
have at law or in equity.
8. General Terms.
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8.1 Synthonics shall have the right, upon reasonable request and during
normal business hours, to audit KL's books to verify revenue from sources
utilizing the RVR(TM) technology.
8.2 If a dispute arises resulting from a discrepancy in the payment of the
license fee, an audit shall be performed by an independent auditor as appointed
and agreed to by both parties. The payment of the audit and all fees and
expenses ancillary and necessary thereto shall born by the parties as follows:
(a) Synthonics agrees to pay all fees and expenses of the audit if the
aggregate of the license fees paid by KL to Synthonics differs by less than
10 % of the aggregate of the fees that the independent audit determines
should have been paid to Synthonics.
(b) KL agrees to pay all fees and expenses of the audit if the
aggregate of the license fees paid by KL to Synthonics differs by 10% or
more than the aggregate of the fees that the independent audit determines
should have been paid to Synthonics.
8.3 KL and its principals, employees, and agents agrees not to use,
replicate, disburse or divulge any of the technology developed on behalf of and
paid for by Synthonics.
8.4 KL and Synthonics agree that if this Agreement is terminated
prematurely, for any reason, both Synthonics and KL shall maintain and hold in
confidence each others technology and not disclosure any such technology of the
other without the expressed written consent of the other party except as set
forth herein.
9. Miscellaneous.
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9.1 The parties will not incur liability to each other for failing to
perform any obligation under this Agreement if such failure results from a force
majeure or any force beyond their reasonable control.
9.2 This Agreement may be executed in any number of copies, each of which
shall be deemed to be an original and all of which taken together shall
constitute but one instrument. The headings and organization of this Agreement
are included and used solely for convenience of reference and shall not
constitute a part in this Agreement for any other purpose
9.3 This Agreement shall be deemed made and accepted in and governed by the
laws of the State of California. The state and federal courts situated in
California shall have exclusive jurisdiction and venue to hear all disputes
arising out of or related to this Agreement.
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9.4 The waiver of any breach of any covenant or condition of this Agreement
shall not hinder or otherwise prevent the subsequent enforcement of said
covenant or condition.
9.5 Synthonics shall have the right to assign any and all rights and
obligations granted or incurred hereunder. KL shall not have the right to
assign, or otherwise transfer, without the prior written consent of Synthonics,
any and all rights and obligations created hereunder and such assignment or
other transfer by KL without such consent shall be null and void and of no
effect.
9.6 If any of the provisions in this Agreement shall for any reason be
declared or held invalid, illegal, or unenforceable in any respect, such
invalidity, illegality, or unenforceability shall not affect any other provision
thereof and this Agreement shall be construed as if such invalid, illegal, or
unenforceable provision had never been contained herein.
9.7 Notices under this Agreement shall be in writing and shall, for all
purposes, be sent by registered or certified mail, return receipt requested,
postage prepaid, properly addressed to the parties at the addresses set forth
below, or at such other address for either party as may be specified by such
party for purposes of this Agreement:
If to KL, addressed to:
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Xxxxx Xxxxxxxx, President
0000 Xxxxxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxxxx 00000
If to Synthonics, addressed to:
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F. Xxxxxxx Xxxx, President
31324 Xxx Xxxxxxx
Xxxxx 000
Xxxxxxxx Xxxxxxx, Xxxxxxxxxx 00000
9.8 This Agreement is the entire agreement between the parties hereto and
supersedes all previous letters, understandings, or verbal agreements which
relate to the working relationship between the two parties. No modification of
this Agreement shall be binding on the parties hereto unless such modification
is in writing and duly signed by each party.
IN WITNESS WHEREOF, the parties have caused their authorized
representatives to make and sign this Agreement.
Knowledge LINK
Dated: 2/17/98 /s/ Xxxxx Xxxxxxxx
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By: Xxxxx Xxxxxxxx
Its: President & CEO
Synthonics Technologies, Inc.
Dated: 2/17/98 /S/ F. Xxxxxxx Xxxx
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By: F. Xxxxxxx Xxxx
Its: President
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