EXCLUSIVE LICENSE AGREEMENT DATED FOR REFERENCE THE
20th DAY OF JULY, 2000
BETWEEN
▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ Inc
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(Hereinafter referred to as "▇▇▇▇▇▇▇▇▇▇▇.▇▇▇" or "Licensor")
OF THE FIRST PART,
AND:
MB Software Corporation
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(hereinafter referred to as "Healthcare Innovations" or "Licensee")
OF THE SECOND PART,
RECITALS
A. Licensor has developed unique technology, plans,
patents, trade secrets, trademarks, service marks,
know-how and processes (collectively "proprietary
information") for the implementation and operation of
internet access screenphones, ("License Unit(s)" or
"Units") as set out in Schedule A, and the ScreenPhone
Applications and Service Package ("License Product(s)")
including network based software administration,
configuration, and update services and control systems,
and all upgrades thereto (collectively "the System" or
"Systems").
B. Licensee desires to obtain an exclusive license to
establish License Units, License Products and Systems
in the United States, in the vertical healthcare market
as a patient communication system, utilizing Licensor's
System and proprietary information and acknowledges
that use of such System and its proprietary information
are subject to controls and restrictions established by
Licensor for the purpose of maintaining a high level of
uniform quality and goodwill in the operation of
License Units, License Products and Systems.
In consideration of the mutual covenants set forth herein,
the parties hereby agree to the following terms and
conditions
ARTICLE ONE
DEFINITIONS
As used in this Agreement, the following terms have the
definition set forth below:
1.1 "Effective Date" means the date on which this License
Agreement has been executed by the latter of the parties to do
so.
1.2 "Gross Sales" means the total of all sales transacted at,
through or through the use of the License Unit(s), License
Product(s) and System(s), whether such sales are evidenced by
check, cash, credit, exchange of otherwise, exclusive of sales
tax or other change imposed on sales by any government
authority. "Gross Sales" also includes all payments to
Licensee from Sub-Licensees from revenues generated at,
through, or through the use of License Units, License
Products, and Systems.
1.3 "Net Revenue" shall be Gross Sales less all reasonable
expenses permitted according to generally accepted accounting
principles, consistently applied.
1.3 "Information Package" means the written technical
information prepared by the Licensor, including operating
manual and other materials, which set forth the details of the
System.
1.4 "Territory" means the geographic area consisting of the
USA on an exclusive basis.
1.5 "Trademarks" means those, trademarks, copyrights, service
marks and patents set forth in the Information Package.
1.6 "Payments" means payments between Licensor and Licensee as
stated in this License Agreement and shall be made in the form
of U.S. Dollars.
1.7 "Sub Licensees" means persons and entities who sub-license
any or all of the rights licensed to Licensee by Licensor
under this Agreement.
ARTICLE TWO
GRANT OF EXCLUSIVE LICENSE
2.1 Licensor grants to Licensee a license to sell, distribute,
sublicense use and operate License Units, License Products and
the System and to sell, distribute, sublicense use and operate
the System in the Territory, in the vertical healthcare market
as a patient communication system, known as the PatientMED
2000, all as more specifically defined in Schedule B (herein
the "Licensee's Market") and the right to grant Sub-Licenses
in connection with the sale, distribution, sublicense, use and
operation of License Units, License Products, and the System
upon the terms and subject to the provisions of this
Agreement. The grant of the above license shall be exclusive
in the Territory for the Licensee's Market.
2.2 Licensor grants to Licensee a license to use and display
Licensor's Trademarks in the Territory in connection with the
operation of License Units, License Products and the Systems
and with regard to the Sub-Licenses granted by Licensee, upon
the terms and subject to the provisions of this Agreement.
2
2.3 Licensee shall have the right but not the obligation to
use the trademark "▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ Inc." or "▇▇▇▇▇▇▇▇▇▇▇.▇▇▇"
in its advertisements, its daily operations and specifically
represent and refer to itself as the licensee for the
Territory for "▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ Inc." and "▇▇▇▇▇▇▇▇▇▇▇.▇▇▇."
ARTICLE THREE
SITE LOCATION AND EXCLUSIVE TERRITORY
3.1 The License Units, License Products and the System shall
be located in the Territory at locations ("Site Locations") to
be selected by Licensee (or Sub-Licensees), subject to
subsequent after sale movement.
3.2 Subject to the terms of this Agreement, Licensor shall not
directly or indirectly sell distribute, use or operate License
Units, License Products or the System, or license or allow
others to directly or indirectly sell, distribute, use or
operate License Units, License Products or the System, within
the exclusive Territory, in the Licensee's Market, during the
term hereof.
ARTICLE FOUR
TRADEMARKS
4.1 Licensee has no right, title or interest in or to any of
the proprietary information and Trademarks, except for
Licensee's privilege and license during the term hereof to
display and use the same. Licensee shall not do or permit any
act or thing to be done in derogation of any of the rights of
Licensor in connection with the Trademarks, whether during the
term of this Agreement or after. Licensee shall use the
Trademarks only for the uses and in the manner licensed under
and as provided in, this Agreement. During or after the term
of this Agreement, Licensee shall not in any way dispute or
impugn the validity of the Trademarks, or the rights of
Licensor to them, or the rights of Licensor or other licensees
of Licensor to use them.
4.2 Licensee may utilize and physically affix signs containing
the Trademarks at such places within or without the License
Units, License Products, and the System as shall be designated
by Licensor in its Technical Manual. Except as expressly
permitted in the Technical Manual, Licensee shall not erect or
display any other signs, or display any other trademarks,
logo-types, symbols or service marks in, upon, or in
connection with the License Units, License Products and the
System without Licensor's prior written approval, this
excludes off-site advertising. Upon the termination of this
Agreement for any reason, Licensee forthwith shall either
deliver and surrender up to Licensor each and all of the
Trademarks, and any physical objects bearing or containing any
of the Trademarks; or obliterate or destroy any Trademarks in
Licensee's possession. Where required, Licensee or
Sub-Licensees shall obtain governmental approval to use
Trademarks, or register same and shall do so solely in the
name of the Licensor..
3
4.3 Licensee agrees promptly to notify Licensor and Licensor
agrees to notify Licensee, in writing, of the institution of
any suit or action or any claim of infringement against
Licensee or Licensor for infringement based on use of the
Trademarks and proprietary information.
ARTICLE FIVE
TRAINING
5.0 Licensee shall have the exclusive obligation and right to
train and otherwise educate all Sub-Licensees throughout the
Territory. Licensee shall have the right to charge
Sub-Licensees for said training and education.
5.1 Licensor will provide an initial training program for up
to 3 individuals to be designated by Licensee, at a time and
place to be designated by Licensor, so that they will be
trained in the complete operation and management of the
License Units, License Products, and the System. These
individuals must sign a confidentiality agreement approved by
Licensor. This training program shall provide basic guidance
on all aspects of System implementation and operation.
5.2 At Licensee's expense during the initial start up period
for the initial License Units, License Products, and the
System shipped to the Territory, the Licensor shall provide,
if requested by Licensee, a qualified representative to train
and/or install the License Units, License Products, and the
System at the corporate headquarters of Licensee or at site
locations as deemed appropriate by Licensor and Licensee.
5.3 The cost of the initial training program instruction and
assistance except for personal meals, travel, lodging, and
other personal expenses of individuals receiving training
shall be paid by the Licensor.
5.4 Should Licensee request additional assistance at site
locations at any time during the term of this Agreement
following start-up, Licensor shall provide a qualified
representative at such times and places as may be reasonable
necessary and mutually convenient. Licensee shall pay all
reasonable personal expenses, plus $300.00 per day for each
such representative.
5.5 Licensor shall have the right from time to time to request
Licensee and/or its manager to attend and complete additional
training courses or programs. Licensee shall bear the cost of
all expenses of such trainees. Licensor shall determine the
time and place of such training in its sole discretion, except
that Licensee shall have the option to have training at
Licensee's headquarters at Licensee's expense.
5.6 Licensor shall make itself available at its office for
consultation and guidance of Licensee in the operation and
management of the License Units, License Products and the
System.
4
5.7 Each party shall be responsible for obtaining all visas
and other immigration or travel documents required for their
respective personnel in the provision of training and
assistance to License pursuant to this Article 5.
5.8 During the term of this Agreement, the Licensor shall
provide, software technical support during normal business
hours at Licensor's expense.
ARTICLE SIX
LICENSOR'S TECHNICAL MANUAL
6.1 Licensor shall provide to Licensee, upon execution of this
agreement, 2 copies of Licensor's existing Technical Manual.
At all times the Technical Manual shall be the property of the
Licensor and may not be duplicated or copied by Licensee.
6.2 Licensor retains the right to modify the Technical Manual
at Licensor's expense. Such modifications shall be delivered
to Licensee, and become effective and binding on Licensee 30
days after delivery thereof to Licensee.
6.3 Licensee agrees to maintain the confidentiality of the
contents of the Technical Manual pursuant to Article 18 of
this Agreement. Licensee shall return to Licensor all copies
of the Technical Manual in its possession upon termination or
expiration of this Agreement.
ARTICLE SEVEN
ADVERTISING
7.1 Licensee shall be responsible for it's own advertising
program and shall bear the cost of same. In the event that in
the future a mutually agreed advertising program is
established a separate agreement will be executed.
7.2 Licensee shall be responsible for providing the proper on
site advertising. This advertising shall include but not be
limited to promotional personnel (at Licensee's discretion to
maximize sales), collateral material and brochures.
7.3 Licensee shall have the exclusive right to initiate and
maintain all advertising relating to its license in all areas
of the Territory.
7.4 Licensor shall furnish to Licensee all advertising and
promotional materials or artwork used by Licensor in its
advertising outside the Territory or for other markets within
the Territory at the best price Licensor charges to others for
such materials. Further, Licensee and Sub licensee's shall
have the express right to use for their advertising at the
best price Licensor charges to others for such materials all
of the Licensor's copyrighted materials, promotional
materials, patents, any brochures, signage, decals and the
like materials. Licensor shall immediately make all said
materials available to the Licensee upon the execution of this
Agreement and upon any change, modification or addition to
materials, including all of the above listed items. Existing
artwork, brochures, collateral and promotional material in
small quantities (less than 25 each) will be provided free of
charge. On orders over 25, a best price shall be given.
Licensor at its sole discretion, shall make available to
Licensee when possible, camera ready artwork, copy, film and
negatives.
5
7.5 Licensee shall have the right to charge Sub-Licensees a
fee for Advertisement.
ARTICLE EIGHT
GENERAL RESPONSIBILITIES OF LICENSEE
8.1 The site locations utilized by Licensee shall conform to
the specifications for the Licensed Units, Licensed Products
and System as set out in the Technical Manual of the Licensor.
8.2 All equipment, fixtures, inventory, and supplies utilized
in the License Units shall conform to applicable
specifications set forth in the Technical Manual, and Licensor
shall have the right to inspect such items during normal
business hours for the purpose of ensuring compliance with
such specifications.
8.3 Licensee shall purchase and, at all times during the term
hereof, maintain policies of insurance with such minimum
standards, coverages, and limits (or such additional limits or
types of coverage) as Licensee and Licensor may from time to
time agree is appropriate to the risks ensuing from the
Licensees use of the Licensed Units, Licensed Products and
System.
8.4 If Licensee has leased the premises for the License Unit:
(i) the lease shall not grant to the landlord under the lease
any rights against Licensor, nor agree to any other term,
condition or covenant that is inconsistent with any provision
of this Agreement. Licensee shall duly and timely perform all
of the terms, conditions, covenants and obligations imposed
under the lease.
8.5 Licensee shall prepare and file all necessary tax returns,
and shall pay any and all local, state/provincial and
federal/national sales and use taxes imposed or incurred, or
levied or assessed by any governmental body, in connection
with any part of this Agreement, relating to any period prior
to closing date, or any of the goods and services sold or
furnished by Licensee in connection with the License Unit or
License Product, promptly, in full, when due, and before any
delinquency.
8.6 Licensee shall not, during the term hereof and for a
period of 2 years following termination of this Agreement,
engage in any business which offers any internet access device
products or services which are competitive with the License
Unit, either as a proprietor, partner, investor, shareholder,
director, officer, employee, principal, agent, advisor or
consultant.
8.7 Licensor may from time to time suggest prices for the
goods and services offered by Licensee. Licensee and Licensor
agree that the prices suggested by Licensor are
recommendations only and are not mandatory. Nothing contained
in this Agreement shall be deemed a representation or warranty
by Licensor that the use of Licensee's suggested prices shall
produce, increase or optimize profits.
6
8.8 Except as provided in Section 8.18 and Article 13 below,
Licensee shall protect, defend and indemnify Licensor, its
subsidiaries, affiliates and designees, and shall hold them
harmless, from and against any and all costs, expenses
(including attorney's fees and court costs), losses,
liabilities, damages, claims and demands of every kind or
nature, arising in any way out of Licensee's operation of the
License Unit.
8.9 Licensee agrees to use all commercially reasonable efforts
to promote the distribution, sale, and use of the PatientMed
2000 Product.
8.10 Licensee agrees to maintain a sufficient inventory of the
PatientMed 2000 Product on hand that it reasonably believes is
need in order to fill anticipated or actual orders
expeditiously at all times during the course of this
Agreement.
GENERAL RESPONSIBILITIES OF LICENSOR:
8.11 Licensor shall provide License Units, License Products
and the System that comply with all applicable specifications
as required to operate Licensed Units, License Products and
the System as intended. Licensor agrees to maintain, and or
arrange with the manufacturer for, a sufficient inventory of
the Licensed Units, License Products and the System on hand
that it reasonably believes is need in order to fill actual
orders expeditiously at all times during the course of this
Agreement.
8.12 Licensor shall be responsible for furnishing the License
Units, License Products and the System with the proper
software and hardware programming for the Licensees described
use and agreed upon specifications. Licensee shall bear the
costs (if any) of any modification and variations to the
Licensed Units, License Products and the System which are
requested by Licensee from Licensor to be shipped and used in
the Territory.
8.13 Licensor agrees to use all commercially reasonable
efforts to promote the distribution, sale and use of the
PatientMED 2000 Product through Licensee.
8.14 Licensor agrees to provide Licensee with all marketing
and sales leads related to the Licensee vertical market
segment, which they generate, and to fairly devote its efforts
to making Licensee a successful venture.
8.15 Licensor agrees to assist Licensee in arranging
sufficient management assistance to pursue the marketing and
distribution of the PatientMED 2000 Product.
8.16 Licensor agrees to advise Licensee of all contemplated
changes in Licensed Unit and License Product and the System
design and price not less than 30 days prior to marketing any
changed Licensed Unit, License Product or Systems or
establishing any revised price.
7
8.17 Licensor agrees to transfer to Licensee all rights, title
and interest in and to the "use and marketing" rights to the
various new products, peripherals and applications currently
being developed or subsequently developed by Licensor, at no
cost.
8.18 Licensor shall protect, defend and indemnify Licensee,
its subsidiaries, affiliates and designees, and shall hold
them harmless, from and against any and all costs, expenses
(including attorney's fees and court costs), losses,
liabilities, damages, claims and demands of every kind or
nature, arising in any way out of the manufacture or design of
the License Unit.
ARTICLE NINE
TERM AND RENEWAL
9.1 Unless sooner terminated in accordance with the provisions
of this Agreement, the term of this Agreement shall commence
on the Effective Date of this Agreement and shall terminate 10
years thereafter. If applicable law in the Territory requires
that Licensor give notice to Licensee with respect to the
expiration of the initial term, this Agreement shall remain in
effect on a month-to-month basis after the expiration of the
initial term until Licensor has given Licensee the notice
required by applicable law.
9.2 If Licensee has in all respects complied with the
conditions set forth in this Article 9.2, Licensee shall have
the right, but not the obligation, to enter into a Renewal
Agreement for a term commencing on the day which follows the
last day of the initial term and terminating 5 years
thereafter. Licensee shall be entitled to enter into a Renewal
Agreement only if, at the time of Licensee's exercise of its
right to do so, Licensee shall have fully performed all of
Licensee's obligations under this Agreement and shall have
received no more than two verified and justified notices of
default during any twelve (12) month period during the initial
term of this Agreement. If Licensor elects not to renew the
Agreement, notice shall be given six (6) months prior to
expiration of term.
9.3 Unless otherwise expressly agreed in writing, the terms of
the Renewal Agreement shall be identical to those of
Licensor's then-current form of license agreement generally
offered by Licensor for the System and License Units, License
Products and the System.
9.4 Licensee shall not be required to pay any initial license
fee upon entering into a Renewal Agreement.
ARTICLE TEN
PAYMENTS TO LICENSOR/PURCHASES FROM LICENSOR
10.1 As an initial license fee, on the Effective Date,
Licensee shall deliver to Licensor a certificate representing
One Million (1,000,000) shares of the Licensee's common stock.
8
10.2 As a continuing license fee Licensee shall also pay
Licensor a sum equal to the following, twenty percent (20%) of
the Net Revenue derived by Licensee from the Internet Service
Provider fee charged by Licensee to the customers (patients)
and five percent (5%) of all other Net Revenue derived by
Licensee from the use of the System by Licensee or its Sub
Licensee's, within the month following billing collected by
Licensee or its Sub Licensee's. Licensor shall on a monthly
basis, pay to licensee an amount equal to fifty percent (50%)
of the difference between (i) the revenue derived from the
commissions received by Licensor generated from the general
content advertising on the PatientMED 2000 Product sold by
Licensee and (ii) less all reasonable expenses permitted
according to generally accepted accounting principles
consistently applied.
10.3 All payments provided for in this Agreement shall be made
at Licensor's or Licensee's (as the case may be) principal
place of business in the manner agreed. No later than 30 days
following the end of each month during the term hereof,
Licensee shall, concurrently with its submission to Licensor
of the daily reports for such month pursuant to Article 12,
pay to Licensor the full amount of the royalty and license
fees due to Licensor for such month.
10.4 If Licensee is delinquent in the payment of any
obligation, under this Agreement, Licensee shall pay to
Licensor a late payment fee of 2% plus a percentage of the
delinquent amount, calculated daily commencing on the first
day that the payment is delinquent and terminating on the day
the delinquent amount is paid. Such percentage shall be
eighteen (18%), on an annualized basis. Notwithstanding the
foregoing, if the amount of the late payment fee is greater
than the amount permitted by applicable law, then such fee
shall be reduced to an amount equal to the maximum lawful fee,
it being the intention of the parties that such late payment
fee shall in no event be greater than that permitted by law.
10.5 All funds due and owing from royalties and/or License
fees and other weekly and monthly amounts other than payment
for the License Units, License Products and the System parts,
materials or initial licensing fees shall be paid in U.S.
Currency. The funds paid to Licensor shall be converted into
U.S. Currency on the first day of the month in which the
payment is to be paid, and all payments to be made in ACH or
wire transfer form, unless another method is requested by
Licensor.
ARTICLE ELEVEN
RECORDS AND REPORTING
11.1 Licensee shall prepare a separate weekly report setting
forth Gross Sales, and calculating Net Revenue and such other
data as Licensor may reasonably request, for each weeks'
business operations at the License Units, License Products and
the System, on a form required pursuant to the Technical
Manual. With respect to each month during the term hereof,
Licensee shall deliver the weekly reports, assembled for such
month, to Licensor not later than 30 days following such
month. Licensor shall have the option via computer network, to
access the daily reports. If Licensor gains access in this
manner Licensee need only submit a monthly statement.
9
11.2 No later than 45 days after the expiration of each
quarter of Licensee's fiscal year and 90 days after the
expiration of each fiscal year, during the term hereof,
Licensee shall furnish a statement of profit and loss in U.S.
Dollars for such respective quarter and fiscal year and a
balance sheet as of the end of such quarter and fiscal year
certified to be true and correct by Licensee.
ARTICLE TWELVE
RELATIONSHIP OF PARTIES
12.1 Licensee is and shall be considered an independent
contractor with entire control and direction of its business
and operations, subject only to the conditions and obligations
established by this Agreement. No agency, employment, or
partnership is created by this Agreement. Licensee's business
is separate and apart from any that may be operated by
Licensor. Neither party to this Agreement shall make any
representations tending to create apparent agency, employment,
or partnership. Neither party will have authority to act for
the other in any manner to create obligations or debts binding
on the other, and neither party will be responsible for any
obligations or expenses whatsoever of the other. Neither
Licensee nor any person performing any duties or engaged in
any work on the premises at the request of Licensee shall be
deemed an employee or agent of Licensor.
ARTICLE THIRTEEN
PURCHASES/WARRANTY
13.1 Licensee shall purchase the License Units, License
Products, and the System from Licensor and pay Licensor
therefore at the wholesale price in effect at the time
Licensee's order is received, less any applicable discount. It
is agreed that the current wholesale price of the Licensed
Product is $420.00 (U.S.) per unit F.O.B. Long Beach
California USA which is based on a Yen conversion.
13.2 Licensee agrees to make an initial purchase an aggregate
of 100 License Units, License Products, and Systems no later
than July 15, 2000.
13.3 Licensee agrees to make purchases of an aggregate of
Licensed Units, License Products, and Systems from Licensor of
not less than the following number of License Units, License
Products, and Systems for each of the following periods:
Remainder of Calendar Year 2000: 1,100
------
Calendar Year 2001: 5,000
------
Calendar Year 2002: 10,000
------
Calendar Year 2003: 10,000
------
Calendar Year 2004: 10,000
------
Calendar Year 2005: 10,000
------
Calendar Year 2006: 10,000
------
Calendar Year 2007: 10,000
------
Calendar Year 2008: 10,000
------
Calendar Year 2009: 10,000
------
Calendar Year 2010: 10,000
------
10
13.4 Licensee shall have the right to make commission payments
to Licensor in lieu of License Unit, License Products, and
Systems purchases equivalent to the amounts that would have
been payable to Licensor pursuant to Section 10.2 if the
number of Licensed Units, License Products, and Systems
specified in Section 13.3 had been purchased, if Licensee so
elects. The amount of such payments shall be determined by
multiplying the shortfall in units by the average unit
wholesale price during such period.. Such commission payments
shall be deemed to fulfill the purchase requirements of
Section 13.3. Should Licensee be unwilling or unable to
purchase such number of License Units as is specified in
Section 13.3 or make payments in lieu as provided hereunder
then Licensor shall have the right to convert the Licensee's
Exclusive License into a non-exclusive license within the
Territory.
13.5 Warranty of Title.
-----------------
13.5.1 Licensor warrants that Licensor has all right, title
and interest and, to and under the License Unit, License
Product and the System and all related proprietary
information, and has all rights to license, sell and
distribute the same to Licensee, free of any rights
(proprietary or otherwise) of any other person or entity or
any other encumbrance.
13.5.2 Licensor shall indemnify, defend an hold harmless
Licensee and any Sub-Licensees against any and all claims
charges, damages, costs, and actions asserted by any person or
entity that the License Units, License Products or the System,
or Licensee's use, sale, operation or distribution thereof,
under this Agreement violates the trade secret, trademark,
copyright, patent or other proprietary right of any other
person or entity. Licensee shall notify Licensor of the
assertion of any such claim and shall cooperate with Licensor
in the investigation and resolution thereof.
13.5.3 Licensor shall not indemnify Licensee against any claim
or liability based on Licensee' modification or conversion of
the Product and/or the subsequent use of that modification or
conversion.
13.6 Limited Warranty.
----------------
Licensor warrants the License Units, License Products, and the
System to be free from defects in workmanship for a warranty
period of one (1) year from the date of delivery, to persons
who purchase the Product from Licensee.
13.7 Warranty Service.
----------------
Licensor shall, at its own expense and option, either repair
or replace any defective items of the Product during the
warranty period, provided that Licensee has notified Licensor
and, upon inspection by Licensor, Licensor has found the
Product to be defective. Licensee sole and exclusive remedy
under this Agreement shall be limited to the repair or
replacement specified herein.
11
13.8 Warranty Conditions.
-------------------
The foregoing warranties are contingent on the proper use of
the product in accordance with the instructions and
specifications published by Licensor and shall not apply to
any Product that has been repaired or modified by persons
other than Licensor.
13.9 Warranty Disclaimer.
-------------------
The express warranties set forth in this Agreement are in lieu
of all other warranties, express or implied, including without
limitation any warranties of merchantability of fitness for a
particular purpose.
ARTICLE FOURTEEN
TRANSFER OF INTEREST
14.1 Licensor has the right to assign this Agreement, and all
of its rights and privileges. The assignee shall be
financially responsible and capable of performing the
obligations of Licensor; and shall assume and agree to perform
all Licensor obligations under this Agreement.
14.2 With respect to Licensee's obligations, this Agreement is
acknowledged to be a personal one, being entered into in
reliance upon and in consideration of the singular skill,
character, and qualifications of Licensee and its principals,
and owners and the trust and confidence reposed therein by
Licensor. Therefore, Licensee may not effect an assignment,
voluntarily or involuntarily, by operation of law or
otherwise, in any manner, without the prior written consent of
Licensor which consent shall not be unreasonably withheld.
Licensor may impose, among other things, the following
conditions precedent to its consent to an assignment: (i) that
the assignee (or the principal officers, shareholders or
directors of the assignee in the case of a corporate assignee)
has the skills, qualifications and economic resources
necessary in Licensor's judgment, reasonably exercised, to
conduct the business contemplated by this Agreement, and to
fulfill the assignee's obligations to the Licensor ; (ii) that
as of the date of any such assignment, Licensee shall have
fully complied with all of its obligations to Licensor under
this Agreement; (iii) that the assignee assumes all of the
obligations of Licensee under all leases for the License
Units, License Products and the System, and that Licensee
shall not be in default with respect to any of its obligations
under said leases; (iv) that assignee pay to Licensor the sum
of five thousand dollars ($5,000) as a transfer fee; (v) that
in the event of an assignment of this Agreement, Licensor
shall require the assignee to execute a new agreement in the
form and on the terms and conditions then being offered by
Licensor to prospective licensees similarly situated, except
that the assignee shall not be obligated to pay an initial
license fee. The term of the new agreement shall expire on the
date provided herein for the expiration of this Agreement. The
execution of the new License Agreement shall, except for the
post-term obligations of Licensee under this Agreement, be
deemed to terminate this Agreement; (vi) that the assignee, or
a manager designated by the assignee, shall have
satisfactorily completed at assignee's cost and expense, the
initial training program then required of all new licensees of
Licensor, unless such training is waived by Licensor, in
writing.
12
14.3 If the Licensee is not, or at any time ceases to be, a
publicly traded company, the transfer in the aggregate of more
than fifty percent (50 %) of the capital stock or voting power
of Licensee if it is a corporation or of more than a fifty
percent (50 %) interest if it is a partnership, as such
parties were originally constituted at the time of the
execution of this Agreement, shall be deemed to be an
assignment of this Agreement within the meaning of this
Article.
14.4 Licensee shall have no right to pledge, encumber,
hypothecate or otherwise give any third party a security
interest in its rights under this Agreement in any manner
whatsoever without the prior written permission of Licensor,
which shall not be unreasonably withheld.
ARTICLE FIFTEEN
TERMINATION
15.1 Licensor shall have the right to rescind this Agreement
forthwith if, within 120 days after the Effective Date,
Licensee has not reasonably complied with the initial training
requirements pursuant to Article 5. If Licensor exercises its
right to terminate pursuant to this Article 15.1, this
Agreement shall be null, void and of no effect, and neither
party shall have any further right or obligation to the other,
except those obligations which by their nature survive such
rescission, provided however, that Licensee's initial fee
pursuant to Article 10.1 shall be refunded in full to
Licensee.
15.2 Licensor may terminate this Agreement for the following
defaults:
(i) Except with respect to Licensee's failure to pay any of
the sums due Licensor under this Agreement, or any related or
ancillary agreement between the parties, and except as
expressly provided in this Agreement, Licensor may terminate
this Agreement upon a material breach by Licensee of any
material provision of this agreement, but only upon 30 days
prior written notice to Licensee, setting forth the material
breach of which Licensor complains. If Licensee cures such
breach before the end of such period, then Licensor shall have
no right to terminate this Agreement because of such breach.
However, if, because of the nature of such breach, Licensee is
unable to cure such breach within such 30 day period, Licensee
shall be given such additional time as is reasonably necessary
within which to cure such breach, upon condition that
Licensee, upon receipt of such notice from Licensor, shall
have immediately commenced to cure such breach and shall
continue to use diligence and all reasonable commercial
efforts to do so.
(ii) With respect to any breach by Licensee of its obligation
to pay any sums due under this Agreement, Licensor may
terminate this Agreement upon not less than 10 days prior
written notice of such breach. If Licensee cures such breach
before the end of such period, then Licensor shall have no
right to terminate this Agreement because of such breach.
13
15.3 Licensor shall have the right to terminate this Agreement
immediately without prior notice to Licensee, upon the
occurrence of any or all of the following events, each of
which shall be deemed to be an incurable breach of this
Agreement which Licensee shall have no right or opportunity to
cure.
(i) If Licensee is adjudicated bankrupt or judicially
determined to be insolvent (subject to any contrary provisions
of any applicable laws), admits Licensee's inability to meet
its financial obligations when due, or makes a disposition of
all or a substantial part of its assets to or for the benefit
of its creditors, or if the License Unit or premises are
seized, taken over or foreclosed by a government official in
the exercise of such official's duties, or by a creditor,
lienholder or lessor, or if a judgment against Licensee in the
amount of more than $500,000.00 remains unsatisfied (unless an
appeal is filed) for a period of more than 60 days.
(ii) If Licensee is convicted of any felony, or any crime
involving moral turpitude or otherwise relevant to the
operation of the License Units, License Products and the
System;
(iii) If Licensee purports to sell, assign, transfer, pledge,
hypothecate, or encumber, in whole or in part, this Agreement
or License Units or License Products and the System in
violation of the terms hereof.
(v) If an audit or investigation conducted by Licensor
discloses that Licensee has fraudulently understated Gross
Sales or Net Revenue or has fraudulently withheld the
reporting of Gross Sales or Net Revenue.
(vi) If in Licensor's reasonable judgment, Licensee's
continued operation will result in an imminent danger to
public health or safety.
15.4 If any valid applicable law or regulation of a
governmental authority having jurisdiction over this Agreement
and the License Unit limits Licensor's rights of termination
under this Agreement or requires longer notice periods than
those set forth above, this Agreement shall be deemed amended
to conform to the minimum notice periods or restrictions upon
termination required by such laws and regulations. Licensor
shall not, however, be precluded from contesting the validity,
enforceability or application of such laws or regulations in
any action, arbitration, gearing or dispute relating to this
Agreement or to its termination.
15.5 In the event of termination of this Agreement, whether by
reason of default, lapse of time or other cause, Licensee
shall forthwith discontinue the use of the Trademarks, and
shall not thereafter operate or do business under any name or
in any manner that might tend to give the general public the
impression that Licensee is operating a License Unit, License
Product, or a System and Licensee shall not thereafter use, in
any manner, or for any purpose, directly or indirectly, any of
Licensor's trade secrets, procedures, techniques or materials
acquired by Licensee by virtue of the relationship established
by this Agreement, including, without limitation to the
foregoing:
14
(i) any manuals, bulletins, instruction sheets and supplements
thereto.
(ii) any forms, advertising matter, marks, devices, insignia,
slogans and designs used from time in connection with the
License Unit or Product;
(iii) any Trademarks, or trade names and patents now or
hereafter applied for or granted in connection therewith, and
if Licensee fails or refuses to do so, Licensor may execute,
in Licensee's name and on Licensee's behalf, any and all
documents necessary to cause the discontinuance of Licensee's
use of trade names and Trade marks, and/or any other related
name used under this Agreement. Licensee hereby irrevocably
appoints Licensor as Licensee's attorney-in-fact to do so.
15.6 The termination of this Agreement shall be without
prejudice to the rights of Licensor against Licensee and
Licensee against Licensor and such termination shall not
relieve Licensor or Licensee of any of its obligations to each
other or terminate those obligations of Licensor or Licensee,
which by their nature, survive the termination of this
Agreement.
15.7 In the event Licensor is adjudicated a bankrupt under
Chapter 7 of the United States Bankruptcy Code, Licensee shall
have the right to all information, licenses, software manuals,
actual programs, software provider names and addresses and any
other material whether copyrighted or patented, that might
assist the Licensee in utilizing the software that is part of
the subject of this Agreement to be used in the License Units,
License Products and the System.
15.8 (a) Upon the expiration or termination of this Agreement,
Licensee shall have no further right to offer or enter into
any additional Sublicense Agreements; and Licensor may itself
open, own or operate, or license others to open own or operate
License Units, License Products and the System in the
Territory.
(b) Upon the expiration or termination of this
Agreement for any reason, Licensee shall at Licensee's
election, assign to Licensor its rights and interest in each
and every Sublicense or at Licensor's election assign such
Sublicenses to other Licensees of Licensor.
15.9 In the event of termination of this Agreement, whether by
reason of default, lapse of time or other cause, the
Licensee's users of shall have the continued right to use and
operate the License Units, License Products and Systems in
their possession.
ARTICLE SIXTEEN
DISPUTE SETTLEMENT
16.1 In the event of any dispute or difference arising out of
or relating to this Agreement or the breach thereof, the
parties hereto shall use their best endeavors to settle such
disputes or differences. To this effect, they shall consult
and negotiate with each other, in good faith and understanding
of their mutual interests, to reach a just and equitable
solution satisfactory to the parties. If they do not reach
such solution within a reasonable period of time, then the
disputes or differences shall be finally settled by an
Arbitration before an arbitration panel operating in
accordance with the Rules of Conciliation and Arbitration of
the International Chamber of Commerce.
15
16.2 The arbitration panel shall be formed of 3 (three)
arbitrators, to be appointed by proper authority. The
arbitration shall take place at Phoenix, Arizona. The
arbitrators shall resolve any dispute or controversy in
accordance with the wording and spirit of this Agreement, and,
if there are no controlling provisions, in accordance with the
laws of Delaware.
16.3 The arbitration award shall be final and binding on the
parties, not subject to any appeal, and shall deal with the
question of costs or arbitration and all matters related
thereto. The arbitration proceedings shall be conducted in
English and the arbitration award shall be written in English.
16.4 Judgment upon the award rendered may be entered into any
court having jurisdiction, or application may be made to such
court for a judicial recognition of the award or an order of
enforcement thereof, as the case may be.
ARTICLE SEVENTEEN
FORCE MAJEURE
The performance or observance by either party of any
obligations of such party under this Agreement may be
suspended by it, in whole or in part, in the event of any of
the following which prevents such performance or observance:
Act of God, war, riot, fire, explosion, flood, sabotage,
injunction, compliance with governmental laws, regulations,
orders or action, or any other cause beyond the reasonable
control of such party; provided, however, that the party so
prevented from complying with its obligations hereunder shall
immediately notify in writing the other party thereof and such
party so prevented shall exercise diligence in an endeavor to
remove or overcome the cause of such inability to comply.
ARTICLE EIGHTEEN
CONFIDENTIALITY
18.1 Licensee shall hold in confidence any and all information
disclosed to it by Licensor concerning the System, business
and marketing plans or strategies, operations and technical
advice and any and all other information of a sensitive
business or technical nature arising under this Agreement.
With respect to all such information, Licensee shall not
disclose the same to others without the Licensor's prior
written consent and to limit dissemination of the same among
Licensee's personnel to those persons having a need to know it
for performance of duties under this Agreement. Licensee shall
use such information only for the purposes contemplated by
this Agreement.
18.2 The foregoing obligation concerning confidentiality and
limitations on use of information shall apply for a period
five (5) years after the date of expiration or termination of
this Agreement except insofar as such information is published
or otherwise in the public domain at the time it was disclosed
to Licensee or thereafter becomes published or part of the
public domain through no fault of Licensee; or is obtained by
Licensee in good faith without restrictions on disclosure or
use from a third person who did not derive it from Licensee.
16
ARTICLE NINETEEN
INTEGRATION OF AGREEMENT: AMENDMENT
19.1 This Agreement constitutes the entire agreement between
the parties with reference to the subject matter of this
Agreement and supersedes all prior negotiations,
understandings, representations and agreements, if any.
Licensee acknowledges that it is entering into this Agreement
as a result of its own independent investigation and not as a
result of any representations of Licensor, its agents,
officers or employees, not contained in any offering circular,
prospectus, disclosure document, or other similar document
required or permitted to be given to Licensee pursuant to
applicable law.
19.2 This Agreement, including but not limited to, this
provision, may not be amended orally, but may be amended only
by a written instrument signed by the parties.
ARTICLE TWENTY
MISCELLANEOUS
20.1 Any notice required or permitted to be given under this
Agreement shall be in writing in the English language and may
be hand delivered, telexed, cabled, sent via facsimile or
mailed by airmail (return receipt requested, postage prepaid)
and shall be deemed given when received. Notices shall be
addressed as follows:
(a) Notices to Licensor: address first written above
(b) Notices to Licensee: address first written above
20.2 English language shall be controlling for all purposes,.
and any language translation shall not affect the meaning or
interpretation of the Agreement.
20.3 This Agreement is executed in two originals, all in the
English language.
20.4 The headings contained in the Agreement are for reference
purposes only and shall not affect the meaning or
interpretation of the Agreement.
20.5 Either party's waiver of any breach, or failure to
enforce any of the terms and conditions of this Agreement, at
any time, shall not in any way affect, limit or waive such
party's right thereafter to enforce and compel strict
compliance with every term and condition of the Agreement.
17
20.6 The construction, performance and completion of this
Agreement is to be governed by the laws of Delaware, USA,
without giving effect to the principals of conflicts of law
thereof.
20.7 Licensor acknowledges that Licensee may be required by
the laws applicable in the Territory to disclose and/or
register this Agreement with governmental authorities, and
consents to such disclosure, provided however, that Licensee
shall inform Licensee of all such required disclosures and/or
registrations made by Licensee. All such registrations, shall,
unless prohibited by local law, identify Licensee as a
Licensee of Licensor.
IN WITNESS WHEREOF, the parties have executed this Agreement
the day and year first above written.
▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ Inc.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Attest: /s/ ▇. ▇▇▇▇▇▇▇▇
------------------------------- ----------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, CEO ▇. ▇▇▇▇▇▇▇▇
MB Software Corporation
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ Attest: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------ ----------------------
▇▇▇▇▇ ▇▇▇▇▇, President and CEO ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
18
Schedule A
1) Mitsui/Sanyo Interactive ScreenPhone model 43526
2) ▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ concept as set out in the ScreenPhone executive summary
and business plan, technical manual, ScreenPhone Applications and
Service Package (SASP), software, SDK, and hardware including website
(in development).
19
Schedule B
1) The extent of the exclusive license granted hereunder for the Territory is
to market the Licensee PatientMed 2000 as a ScreenPhone based patient
communications system for use in a managed services organization focused on
building a national physical medical enterprise network using a pain
management treatment system developed by Licensee in combination with the
use of the Internet and ScreenPhones to deliver information to the patient,
physician and insurer. The PatientMED 2000 Product will utilize an
Internet/Web based information and order entry system that will allow
patients and doctors to communicate and deliver information. The PatientMED
2000 will allow patients to access nutrition information, order nutrition
products, as well as fitness products and market a fitness formula to help
patients be free of pain.
20
