Exhibit 99.2
AGREEMENT
This Agreement is effective as of February 28, 2005 ("Effective Date"), between
Long Range Systems, Inc. ("LRS"), on the one hand, and NTN Communications, Inc.
("NTN"), on the other hand. LRS and NTN may be referred to hereafter
collectively as the "Parties."
(A) WHEREAS, litigation is presently pending between LRS and NTN styled
LONG RANGE SYSTEMS, INC. V. NTN WIRELESS COMMUNICATIONS, INC., Case No.
3-03CV-598L in the United States District Court for the Northern
District of Texas (the "Texas Lawsuit") and in the United States
District Court for the Southern District of California styled NTN
COMMUNICATIONS, INC. V. LONG RANGE SYSTEMS, INC., Case No. 03-CV-1042
LAB AJB (the "California Lawsuit");
(B) WHEREAS, the Parties mutually wish to resolve the Texas and California
Lawsuits by compromise through this Agreement;
(C) WHEREAS, the Parties acknowledge that this Agreement constitutes a
compromise and settlement of disputed claims, and in no way constitutes
an admission by any of the Parties of any fault or liability whatever
in connection with any matter or thing;
NOW, THEREFORE, in consideration of the mutual promises, covenants and releases
contained herein, the Parties agree as follows:
1. DEFINITIONS
1.1 "Affiliate" means any corporation, company or other business entity
that directly, or indirectly through one or more intermediaries,
controls, is controlled by or is under common control with a Party to
this Agreement;
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1.2 The terms "control," "is controlled by" and "is under common control"
mean the possession, directly, or indirectly, of 50% or more of the
equity capital and voting rights of the corporation, company or other
business entity in question.
2. RELEASES
2.1 LRS does hereby release and discharge NTN and its respective
predecessors, successors, assigns, affiliates, divisions, related
entities, trustees, directors, officers, attorneys, agents, servants,
employees and customers, past and present ("NTN Releasees"), and each
of them, from any and all claims, demands, and causes of action, of
whatever kind or nature, whether known or unknown, or suspected or
unsuspected by LRS, which LRS now owns or holds or has at any time
owned or held against the NTN Releasees, or any of them, except as
specifically provided in paragraph 2.3 below.
It is the intention of LRS in executing this Agreement that the same
shall be effective as a bar to each and every claim, demand and cause
of action hereinabove specified, and in furtherance of this intention,
LRS does hereby expressly waive and relinquish all applicable
provisions, rights and benefits of Section 1542 of the California Civil
Code, except as specifically provided in paragraph 2.3 below. LRS
warrants that it is familiar with and has been advised of the
provisions of California Civil Code Section 1542, which provides as
follows:
"A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at the
time of executing the release, which if known by him must have
materially affected his settlement with the debtor."
LRS further represents and warrants that it has neither assigned nor
transferred, nor purported to assign or transfer, to any other person
or entity any claim or matter herein released.
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2.2 NTN does hereby release and discharge LRS and its respective
predecessors, successors, assigns, affiliates, divisions, related
entities, trustees, directors, officers, attorneys, agents, servants,
employees and customers, past and present ("LRS Releasees"), and each
of them, from any and all claims, demands, and causes of action, of
whatever kind or nature, whether known or unknown, or suspected or
unsuspected by NTN, which NTN now owns or holds or has at any time
owned or held against the LRS Releasees, or any of them, except as
specifically provided in paragraph 2.3 below.
It is the intention of NTN in executing this Agreement that the same
shall be effective as a bar to each and every claim, demand and cause
of action hereinabove specified, and in furtherance of this intention,
NTN does hereby expressly waive and relinquish all applicable
provisions, rights and benefits of Section 1542 of the California Civil
Code, except as specifically provided in paragraph 2.3 below. NTN
warrants that it is familiar with and has been advised of the
provisions of California Civil Code Section 1542, which provides as
follows:
"A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at the
time of executing the release, which if known by him must have
materially affected his settlement with the debtor."
NTN further represents and warrants that it has neither assigned nor
transferred, nor purported to assign or transfer, to any other person
or entity any claim or matter herein released.
2.3 LRS and NTN specifically reserve all claims, rights and remedies
against each other for their respective uses of any Internet search
engine terms containing any trademarks or logos belonging to the other
company in accordance with federal or state law. These claims are
specifically excepted from this Agreement, and either party may
initiate legal proceedings at any time on claims seeking redress for
the specific conduct described in this paragraph. However, the Parties
agree that there are no other exceptions to the mutual releases
provided in this Agreement.
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2.4 Concurrent with the execution of this Agreement, the Parties shall
cause their respective counsel in the Texas and California Lawsuits to
execute and file Requests for Dismissal with Prejudice in the forms
attached hereto as Exhibits A and B, respectively.
3. DISPUTE RESOLUTION
3.1 If any dispute should arise out of or relating to this Agreement, the
Parties shall complete the following dispute resolution procedures as a
prerequisite to any legal action, unless and except as the Parties
shall otherwise mutually agree in writing:
(a) The Party with the grievance ("Aggrieved Party") shall first
give written notice of the alleged breach and a reasonable
period of at least thirty (30) days in which to cure the
alleged breach.
(b) Upon expiration of the cure period, if the dispute has not
been resolved, those executives of the respective parties who
have authority to settle the controversy and have direct
responsibility for administration of the relationships
established pursuant to this Agreement shall, as soon as
practicable, meet and negotiate in good faith to resolve any
dispute between them regarding this Agreement, including
without limitation, an allegation of a material breach of this
Agreement made by one Party against another.
(c) If such negotiations and meetings do not resolve the dispute
to the satisfaction of the Parties within thirty (30) days
from the start of such negotiations and meetings, then each
Party within a week will nominate one senior officer as its
representative. These representatives will meet as soon as
practicable and will attempt in good faith to resolve the
dispute. This meeting of representatives will be a required
prerequisite before either Party may seek judicial or
governmental resolution of the dispute. The Parties may agree
to pursue any other any other additional mutually acceptable
dispute resolution method but such pursuit will not modify the
above-stated prerequisites.
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4. REPAIR ACTIVITIES AND PRODUCT EXCHANGES
4.1 NTN may repair any LRS product for any third party as long as such
activities do not rise to the level of complete remanufacture of such
products in violation of LRS's intellectual property rights under
federal or state law. If NTN's repair services damage or obscure the
label on the top surface of any LRS product, NTN must place a plain,
black label on the top surface as a replacement label. Furthermore, for
any LRS product that NTN repairs, NTN shall not place any labels other
than the black label on the product, except that it shall place a label
on the bottom surface of the product bearing the following statement:
"Manufactured by Long Range Systems, Inc."
LRS's Current Telephone Number
LRS's Current Internet Website Address
"Repaired by NTN Communications, Inc."
NTN's Current Telephone Number
NTN's Current Internet Website Address
All of the text on this label shall have the same font type, style,
size and color. Should the name, telephone number, or Internet website
address for LRS or the entity conducting NTN's repair services change,
NTN shall substitute the successor name, telephone number, or Internet
website address on its labels on all repaired products thereafter, as
soon as practicable following receipt of notice of any such change in
accordance with Section 5.7 hereof.
4.2 LRS may repair any NTN product for any third party as long as such
activities do not rise to the level of complete remanufacture of such
products in violation of NTN's intellectual property rights under
federal or state law. If LRS's repair services damage or obscure the
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label on the top surface of any NTN product, LRS must place a plain,
black label on the top surface as a replacement label. Furthermore, for
any NTN product that LRS repairs, LRS shall not place any labels other
than the black label on the product, except that it shall place a label
on the bottom surface of the product bearing the following statement:
"Manufactured by NTN Communications, Inc."
NTN's Current Telephone Number
NTN's Current Internet Website Address
"Repaired by Long Range Systems, Inc."
LRS's Current Telephone Number
LRS's Current Internet Website Address
All of the text on this label shall have the same font type, style,
size and color. Should the name, telephone number, or Internet website
address for NTN or the entity conducting LRS's repair services change,
LRS shall substitute the successor name, telephone number, or Internet
website address on its labels on all repaired products thereafter, as
soon as practicable following receipt of notice of any such change in
accordance with Section 5.7 hereof.
4.3 If NTN and LRS receive each other's products through the ordinary
course of business, either party may offer a one-for-one exchange of
these products to be completed only upon mutual agreement of the
Parties as to the manner, mode and timing of such exchange.
5. MISCELLANEOUS
5.1 This Agreement constitutes the entire agreement between the Parties
relating to the subject matter hereof, and supersedes all prior
proposals, agreements, representations and other communications between
the Parties with respect to the same.
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5.2 No amendment, modification or other change to the provisions of this
Agreement shall be valid unless in writing and signed by all of the
Parties.
5.3 The headings used in this Agreement are for reference and convenience
only and shall not be used in interpreting the provisions of this
Agreement.
5.4 The Parties shall issue the joint press release attached as Exhibit C.
The Parties shall not issue any other press releases concerning the
settlement of the Texas and California Lawsuits.
5.5 This Agreement may be included as an exhibit to the Current Report on
Form 8-K and to its Form 10-K to be filed by NTN with the Securities
and Exchange Commission.
5.6 If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule of law or public policy, all
other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in
any manner materially adverse to any Party. Upon such determination
that any term or other provision is invalid, illegal or incapable of
being enforced, the Parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the
Parties as closely as possible in an acceptable manner to the end that
the transactions contemplated hereby are fulfilled to the fullest
extent possible.
5.7 Any notice or acceptance provided for in this Agreement shall be in
writing and shall be deemed to have been given on the date such
communication is deposited in certified or registered United States
first class mail, in an appropriately stamped envelope, addressed as
follows (or to such other address as a Party shall designate by written
notice given to the other Party):
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To Long Range Systems, Inc.:
----------------------------
Long Range Systems, Inc.
0000 Xxxxxxxxx Xxxxx
Xxxxxx, Xxxxx 00000
Attention: Chief Executive Officer
With Copy To:
-------------
Xxxxxxx X. Xxxxxxxx
Xxxxxxxx & Xxxxxxxx LLP
The White House on Turtle Creek
0000 Xxxxxx Xxxxx Xxxx.
Xxxxxx, Xxxxx 00000
To NTN Communications, Inc.:
----------------------------
NTN Communications, Inc.
0000 Xx Xxxxx Xxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
With Copy To:
-------------
Xxxxx X. Xxxxxxxxx
O'Melveny & Xxxxx LLP
000 Xxxxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
5.8 The Parties agree that this Agreement shall be governed by and
construed in accordance with the laws of the State of California,
without regard to choice of law provisions.
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5.9 The Parties acknowledge and agree that each has been represented by
counsel in connection with the negotiation and drafting of this
Agreement, that they have each reviewed this Agreement, and that any
rule of construction to the effect that ambiguities are to be resolved
against the drafting party shall not apply to the interpretation of
this Agreement.
5.10 This Agreement may be signed in counterparts. Any set of counterpart
copies of this Agreement, if they collectively bear the original
signatures of all the signatories provided for below, shall constitute
an original of this Agreement.
5.11 The Courts in which the Texas and California Lawsuits were pending
shall retain jurisdiction to enforce this Agreement between the
Parties.
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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
by their duly authorized representatives:
Long Range Systems, Inc. NTN Communications, Inc.
By: /s/Xxxxxxx X. Xxxxxxxxx By: /s/ Xxxxx X. Xxxxxx
--------------------------------- --------------------------
Printed Name: Xxxxxxx X. Xxxxxxxxx Printed Name: Xxxxx X. Xxxxxx
----------------------- ----------------
Title: President Title: Chief Financial Officer
------------------------------- -----------------------
Date: 3/8/05 Date: 2/28/05
-------------------------------- ------------------------
By: /s/Xxxx X. XxXxxxxx
---------------------------------
Printed Name: Xxxx X. XxXxxxxx
------------------------
Title: VP Mfg
-------------------------------
Date: 3/8/05
--------------------------------
By: /s/Xxxxxxx Blink
----------------------------------
Printed Name: Xxxxxxx Blink
------------------------
Title: Vice President
-------------------------------
Date: 3/8/05
--------------------------------
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EXHIBIT A
---------
IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
LONG RANGE SYSTEMS, INC., SS.
SS.
Plaintiff, SS. Civil Action No. 3 03CV 598L
SS.
vs. SS.
SS.
NTN WIRELESS COMMUNICATIONS, INC. SS.
f/k/a ZOOM COMMUNICATIONS, SS.
SS.
Defendant. SS.
STIPULATION OF DISMISSAL
It is hereby stipulated by and between counsel to plaintiff Long Range
Systems, Inc. and counsel to defendant NTN Communications, Inc., as follows:
1. All claims and counterclaims in the above-captioned action between
the parties are dismissed with prejudice.
2. Each party will bear its own costs and attorneys' fees.
3. This Court will retain jurisdiction to enforce the Settlement
Agreement between the parties, dated February 28, 2005, of which this
Stipulation forms a part.
DATED: February ___, 2005 BY THE COURT:
_______________________________
The Xxxxxxxxx Xxx X. Xxxxxxx
United States District Judge
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COUNSEL TO LONG RANGE SYSTEMS, INC. COUNSEL FOR NTN COMMUNICATIONS, INC.
Xxxxxxx X. Xxxxxxxx Xxxxxxxx X. Xxxxxxx-Xxxxxxx
Xxxxxxxx & Xxxxxxxx, LLP Texas Bar No. 10474900
The White House on Turtle Creek Xxxxx Liddell & Xxxx LLP
0000 Xxxxxx Xxxxx Xxxxxxxxx 0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000 Xxxxxx, Xxxxx 00000-0000
(000) 000-0000 000-000-0000 (Telephone)
Fax: (000) 000-0000 000-000-0000 (Facsimile)
By: By:
--------------------------------- -----------------------------------
Xxxxxxx X. Xxxxxxxx Xxxxxxxx X. Xxxxxxx-Xxxxxxx
Of Counsel:
-----------
Xxxxx X. Xxxxxxxxx
California Bar No. 137065
Xxxx X. Xxxxxx
California Bar No. 197619
O'Melveny & Xxxxx LLP
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
000-000-0000 (Telephone)
Page 12 of 15 STIPULATION OF DISMISSAL
EXHIBIT B
---------
XXXXX X. XXXXXXXXX (S.B. #137065)
XXXX X. XXXXXX (S.B. #197619)
O'MELVENY & XXXXX LLP
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attorneys for Plaintiff,
NTN COMMUNICATIONS, INC.
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF CALIFORNIA
NTN COMMUNICATIONS, INC., Case No. 03 CV 1042 LAB AJB
Plaintiff, STIPULATION OF DISMISSAL
v.
LONG RANGE SYSTEMS, INC.,
Defendant.
------------------------------------------------------------
It is hereby stipulated by and between counsel to plaintiff NTN
Communications, Inc., and counsel to defendant Long Range Systems, Inc., as
follows:
1. All claims and counterclaims in the above-captioned action between
the parties are dismissed with prejudice.
2. Each party will bear its own costs and attorneys' fees.
3. This Court will retain jurisdiction to enforce the Settlement
Agreement between the parties, dated February 28, 2005, of which this
Stipulation forms a part.
DATED: February ___, 2005 BY THE COURT:
____________________________________
The Xxxxxxxxx Xxxxx X. Xxxxx
United States District Judge
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COUNSEL FOR NTN COMMUNICATIONS, COUNSEL FOR LONG RANGE SYSTEMS,
INC. INC.
Xxxxx X. Xxxxxxxxx
California Bar No. 137065 Xxxx X. Xxxxxxxxxx
Xxxx X. Xxxxxx Techmark
California Bar No. 197619 00 Xx. Xxxxxx Xxxxxx
X'Xxxxxxx & Xxxxx LLP 16th Floor
000 Xxxxx Xxxx Xxxxxx Xxx Xxxx, XX 00000
Xxx Xxxxxxx, Xxxxxxxxxx 00000 (000) 000-0000
000-000-0000 (Telephone) Fax: (000) 000-0000
By:
---------------------------------------
Xxxxx X. Xxxxxxxxx
By:
-------------------------------
Xxxx X. Xxxxxxxxxx
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EXHIBIT C
---------
FOR IMMEDIATE RELEASE
NTN AND LONG RANGE SYSTEMS ANNOUNCE SETTLEMENT OF LITIGATION
------------------------------------------------------------
CARLSBAD, CALIF. AND DALLAS, TEXAS (MAR. __, 2005) NTN COMMUNICATIONS, INC.
(AMEX: NTN) AND LONG RANGE SYSTEMS, INC. today announced an agreement to settle
and dismiss litigation relating to allegations of patent infringement and unfair
competition filed by Long Range Systems in United States District Court,
Northern District of Texas and to counter charges alleged by NTN against Long
Range Systems, including domain name misappropriation and unfair competition,
pending in the United States District Court, Southern District of California.
Under the terms of the settlement, NTN and Long Range Systems each agreed to
settle and dismiss the two lawsuits without liability or any payment to the
other party. Each party will be responsible for its own legal costs.
The complete settlement agreement will be included as an exhibit to the Current
Report on Form 8-K to be filed by NTN with the Securities and Exchange
Commission.
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