STRATEGIC ALLIANCE
RESEARCH AND DEVELOPMENT AGREEMENT
This Agreement entered into this ninth day of September, 1998.
BY AND AMONG:
QuesTec Imaging, Inc., a corporation duly organized and existing under the laws
of Wyoming, United States, and having its principle office of business at 000 X
Xxxx Xxxxxxxx Xxxxx, Xxxx Xxxx, Xxx Xxxx 00000 (hereinafter referred to as
"QuesTec").
Atlantic Aerospace Electronics Corporation, a corporation duly organized and
existing under the laws of Delaware, United States, and having its principle
office of business at 0000 Xxx Xxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxx 00000
(hereinafter referred to as "Atlantic").
WITNESSETH THAT:
WHEREAS, QuesTec is the owner of several technologies relating to software
systems developed for sports broadcasts, athletic analysis and production
services.
WHEREAS, Atlantic is a developer of signal processing and motion/static tracking
systems and software technology.
WHEREAS, QuesTec and Atlantic desire to participate on software and product
development as defined hereinafter through QuesTec's research and development.
QuesTec desires to undertake such software development and distribution thereof
employing said technologies developed and acquired by QuesTec and Atlantic and
the parties hereto desire to encourage others to participate in the same to the
mutual benefit of QuesTec and Atlantic and
WHEREAS, QuesTec and Atlantic are willing to enter into an Agreement which calls
for the development of software related broadcast enhancement and quantitative
motion sensing/capture products in the field of sports broadcasting and athletic
performance and statistical analysis.
NOW THEREFORE, it is agreed among the parties as follows:
ARTICLE 1. DEFINITIONS
"QUESTEC INTELLECTUAL PROPERTY" shall mean certain patents, trademarks,
servicemarks and copyrights which are held by QuesTec on software series and
relate to the fabrication and use of the Software, and know-how which includes
all descriptions of data, technical know-how and trade secrets (including but
not limited to, information on QuesTec's customers) relating to the fabrication
and use of the Software, all of which shall be fully described in the individual
contracts.
"INTELLECTUAL PROPERTY" shall mean software related products developed by
QuesTec and partially funded by Atlantic directly through their own research and
development or indirectly as an agent.
"PATENTS" shall mean any patents and patent application relating to software,
products, business models and any patents issuing upon any divisions or
continuation of such patents and patent applications; any patents which issue
upon patent application corresponding to any of the aforesaid patents and patent
applications; and any reissues, extensions or additions to any of the foregoing,
all of which are obtained through the development during the life of the
Agreement.
"COPYRIGHTS" shall mean any copyrights relating to the Software which are
obtained through the Development during the life of the Agreement.
"THE SOFTWARE" shall mean certain software in the fields of sports to be used
for sports broadcasting, athletic performance and statistical analysis and
production services that exist and/or are to be developed by QuesTec employing
Patents, Improvement Patents and know-how.
"DEVELOPMENT" shall mean research, development, creation, invention and any
other work to be conducted and performed by QuesTec and Atlantic hereto for the
successful manufacture of the Software.
"INDIVIDUAL CONTRACTS" shall mean those contracts between the parties where the
parties agree to develop specified software applications under this Agreement.
ARTICLE 2. WARRANTIES AND UNDERTAKINGS
QuesTec and Atlantic represent and warrant that they have the full right and
power to grant the rights set forth herein. QuesTec further represents and
warrants that to the best of its knowledge it has full title to its own QuesTec
Intellectual Property, and that there are no outstanding agreements, licenses,
assignments, ship rights or other encumbrances in any manner inconsistent with
the provisions of this Agreement.
ARTICLE 3. INDIVIDUAL CONTRACTS
Specifications of the Software, term for development, share for the expenses for
development, the amount of the royalty for the Intellectual Property, and any
other detailed terms and conditions shall be provided for in the Individual
Contracts.
If there is any inconsistency between the provisions of such Individual
Contracts and this Agreement, the former shall prevail.
ARTICLE 4. TECHNICAL INTERFACE
Each party shall have a Manager for the exchange of know-how. The Manager shall
supervise the exchange of know-how, arrange conferences and visitations,
maintain pertinent records, and the like, and shall be responsible for authoring
transmissions, disclosure and receipt of know-how.
Prior to disclosure of Intellectual Property, the Manager of the supplying party
shall generally identify the proposed disclosure and obtain a written agreement
from the Manager of the other Party, so that the latter understands the nature
of and reason for the identified disclosure and is willing to accept the
identified disclosure. The identified Intellectual Property may thereafter be
disclosed by the Manager of the disclosing party to the Manager of the other
party under a Confidential Information designation. Such disclosure shall be
deemed to be confidential only to the extent that it is received in writing from
the disclosing party, or, if received only to the extent that it is confirmed in
writing by the disclosing party within fourteen (14) days of the oral
disclosure. The receipt of confidential Intellectual Property shall be promptly
acknowledged in writing by the Manager of Atlantic.
Respecting any confidential Intellectual Property transmitted and received in
accordance with Article 5, to the extent that such Intellectual Property remains
confidential pursuant to Article 5, Atlantic shall use the same efforts to avoid
publication or dissemination of such confidential Intellectual Property as it
employs with respect to information of its own which it does not desire to be
published or disseminated. Notwithstanding expiration or termination of this
Agreement pursuant to Articles 9 and 10, this paragraph shall remain effective
for another two (2) years from the date of expiration or termination of this
Agreement.
ARTICLE 5. COPYRIGHT
QuesTec and Atlantic shall jointly acquire and hold the copyright in "The
Software" which is developed by QuesTec and Atlantic pursuant to this Agreement.
ARTICLE 6. APPLICATIONS FOR PATENTS
QuesTec and Atlantic shall jointly apply for patents for "The Software" and
"Inventions" which are required and developed under this Agreement, and shall
jointly own the Patents. QuesTec and Atlantic shall share the expenses in
obtaining and maintaining such patents.
ARTICLE 7. INTELLECTUAL PROPERTY PROTECTION
In the event that Intellectual Property licensed hereunder to Atlantic by
QuesTec is infringed by the use, sale or lease of The Software by an unlicensed
third party, QuesTec may at its option and at its expense, file and prosecute a
lawsuit against such infringer and, in the case of an award of damages related
directly to the Software, after deducting its relevant costs therefrom, any
excess of each damage award shall be divided equally between QuesTec and
Atlantic. If QuesTec elects not to pursue such infringer for all of their
infringement of said Intellectual Property, then Atlantic may at their option
pursue such infringer, at their expense, and, in the case of an award of
damages, whether or not related directly to The Software, after deducting their
costs from such
damages, any excess of any damage award shall be divided equally between QuesTec
and Atlantic. The parties hereto shall each extend to the others full
cooperation in all such litigation proceedings, and either party may join the
other as a party thereto.
In the event that on account of the use of QuesTec Intellectual Property, the
Copyrights, or the use or lease/sale of The Software, either Atlantic or QuesTec
is sued for patent, copyright or any other intellectual Property infringement by
a third party, then QuesTec and Atlantic shall promptly and continuously share
and exchange all information relevant to the defense of each lawsuit.
Either party may join the other as a defendant, and both parties shall give due
and reasonable credence to the legal and business judgment of the other party in
adopting a reasonable settlement or continuance of each litigation. No
settlement shall be reached which affects the royalty income of the other party
without the written consent of such other party which consent shall not be
unreasonably withheld whether the proposed compromise, if any, be in regard to
the terms of settlement or a reasonable design change in The Software.
ARTICLE 8. AGREEMENT BETWEEN QUESTEC AND ATLANTIC
In the event that QuesTec and Atlantic shall enter into additional Agreements,
unless specified, all Agreements shall remain binding. Atlantic is to inform
QuesTec of any and all inquiries concerning the use of the above mentioned
products and or services.
ARTICLE 9. TERM
This Agreement shall come into force on the day first above written and continue
in full force and effect for seven (7) years, and, thereafter, be automatically
renewed for one (1) year periods unless terminated by a written notice given by
either party to the other at least 6 months prior to the expiration date of the
initial period or of any subsequent one year period of this Agreement.
ARTICLE 10. TERMINATION
Should QuesTec or Atlantic at any time commit any breach of this Agreement and
should such failure or breach not be cured within sixty (60) days after written
notice from either party to the defaulting party specifying the nature of the
default, the notifying party shall thereafter have the right to terminate this
Agreement and/or any licensing rights hereunder as the case may be, by giving
written termination notice to the other party, and such termination shall become
effective on the sixtieth (60) day after the dispatch of such termination
notice. A termination under this Article shall place the parties in the
respective legal position which existed prior to the effective date of this
Agreement.
Should either QuesTec or Atlantic become insolvent, make an assignment for the
benefit of creditors or be adjudged bankrupt, or should a receiver or trustee of
the property of either QuesTec or Atlantic be appointed, the other party may
forthwith terminate this Agreement.
ARTICLE 11. NOTICE
All notices and statements to be given shall be sent by mail or facsimile to the
respective addresses of the parties as set forth above unless notification of a
change of address is given in writing. When such notice is given by mail, the
date of mailing shall be deemed the date the notice or statement is given. A
notice given by facsimile shall be deemed effective one day after dispatch,
subject to being followed by mail.
ARTICLE 12. ARBITRATION
All disputes, controversies or differences which may arise among the parties
hereto, out of or in relation to or in connection with this Agreement, or the
breach thereof, shall be finally settled by arbitration in the United States in
accordance with The Commercial Arbitration Rules of The U.S. Commercial
Arbitration Association. The award rendered by arbitrator(s) shall be final and
binding upon the parties.
ARTICLE 13. FORCE MAJEURE
Neither party shall be liable to the other for failure or delay in the
performance of any of its obligations under this Agreement for the time and to
the extent such failure or delay is caused by riots, civil commotions, wars,
hostilities between nations, governmental laws, orders or regulations,
embargoes, actions by the government or any agency thereof, acts of God, storms,
fires, accidents, strikes, sabotage, explosions, or other similar or different
contingencies beyond the reasonable control of the respective parties. If, as a
result of legislation or governmental action, any party or parties are precluded
from receiving any benefit to which they are entitled hereunder, the parties
shall review the terms of this Agreement so as to be in the same relative
positions as previously obtained hereunder.
ARTICLE 14. NON-ASSIGNABILITY
Neither party hereto shall assign any of its rights or obligations under this
Agreement without the prior written consent of the other party hereto.
ARTICLE 15. INTERPRETATION
This Agreement shall be construed and interpreted according to the laws of the
United States and the state of New York.
ARTICLE 16. MODIFICATION
This Agreement supersedes any and all prior agreements between the parties
hereto regardless of whether such agreements, if any, existed by reason of
direct contract, assignment or otherwise whatsoever, and it embodies all of the
understandings and agreements between the parties pertaining to the subject
matter hereof and may be amended or modified only by written instrument duly
executed by the parties.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be signed
and sealed by their duly authorized office or representative as of the date
first above written.
"QuesTec"
QuesTec Imaging, Inc.
by: /s/ Xxxxxx X. Xxxxxxxxx
------------------------
Xxxxxx X. Xxxxxxxxx
by: /s/ Xxxxxxx X. Xxxxx
------------------------
Xxxxxxx X. Xxxxx
"Atlantic"
Atlantic Aerospace Electronics Corporation
by: /s/ Xxxxxx X. Xxxxxx
------------------------
Xxxxxx X. Xxxxxx
by: /s/ Xxxxxx X. Xxxxxxxxx
------------------------
Xxxxxx X. Xxxxxxxxx
INDIVIDUAL CONTRACT
SPORTS RELATED DEVELOPMENT
THIS DEVELOPMENT AGREEMENT ("Agreement") is made this ninth day of September,
1998, by and between QuesTec Imaging, Inc., having its principle office of
business at 000 X Xxxx Xxxxxxxx Xxxxx, Xxxx Xxxx, Xxx Xxxx 00000 ("QuesTec") and
Atlantic Aerospace Electronics Corporation, having its principle office of
business at 0000 Xxx Xxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxx 00000 ("Atlantic").
RECITALS
QuesTec and Atlantic wish to collaborate on the development of products that
will display real time graphic simulation of players (athletes) and any and all
action on the field of play by combining sensing technology, signal processing,
animation software, custom interface software, peripheral hardware equipment,
engineer operators and graphic workstations (the "Systems"). When operated, the
System will produce quantified data and 3-dimensional graphics from both live
and manual data entry.
THEREFORE, in consideration of the following terms and conditions, QuesTec and
Atlantic agree as follows:
1. OWNERSHIP OF THE SYSTEMS.
Atlantic shall retain ownership of the Software Atlantic develops under this
Agreement and is incorporated into the Systems. The parts of each System not
developed by Atlantic shall be owned by QuesTec.
2. DISTRIBUTION PARTNERSHIP.
Atlantic shall grant QuesTec a license to use executable software libraries
("Software") Atlantic develops under this Agreement. This license shall give
QuesTec perpetual and exclusive rights to use the Software for sports related
applications. In exchange for this license to use Atlantic's Software, QuesTec
will grant Atlantic options for 500,000 stock options for shares in the common
stock of QuesTec Imaging, Inc. QuesTec will also pay Atlantic a 10% royalty on
QuesTec's portion of gross revenues derived directly or indirectly from the
sale, license or use of the Systems. These stock options will have a life of 5
years and will be subject to a 1 year restriction.
If after 9 months Atlantic is not satisfied with this arrangement they may
convert the above mentioned form of remuneration for a flat 15% royalty on
QuesTec's portion of gross revenues derived from the sale, license or use of the
Systems, retroactive to the effective date of this Agreement, at which time
Atlantic will forfeit any and all rights to the above mentioned stock options.
Atlantic must notify QuesTec on or before the 10 month anniversary of this
agreement if it wishes to change the original remuneration agreement.
QuesTec shall reimburse Atlantic for travel costs associated with joint
marketing activities.
3. COMPLETION OF DEVELOPMENT.
The Systems will be developed, tested and ready for use according to schedules
mutually agreed to by QuesTec and Atlantic.
4. RESPONSIBILITY OF QUESTEC.
QuesTec will:
(a) design packages of software and hardware peripherals which comprise
turnkey applications for non-intrusive tracking of sports activities
(the "Tracking Mechanisms") during live events
(b) compile and translate the data from the Tracking Mechanism into a
format that can be rendered on a graphics workstation for live
television broadcasts, pregame and postgame productions and athletic
analysis;
(c) support Atlantic's development activities by providing hardware,
software, data, and assistance in operational testing
(d) market Systems and services developed by QuesTec and Atlantic to the
broadcast industry and other potential customers, and acquire
contracts for their use
(e) inform Atlantic of potential markets and contracts in broadcast sports
and other industries, and share revenue projections
(f) integrate, install and operate Systems and services developed by
QuesTec and Atlantic and collect associated revenue
(g) credit Atlantic in QuesTec communications and advertising, and expend
best efforts to obtain on-air credits for Atlantic
(h) retain the exclusive use and distribution rights to the Systems.
(i) grant licenses for the Systems to third parties in other geographical
areas and will share any and all profits resulting from these
licensing and royalty fees with Atlantic on a fifty-fifty (50/50)
basis.
5. RESPONSIBILITY OF ATLANTIC.
Atlantic will:
(a) develop software to track players and objects and derive quantitative
data during sports events
(b) provide executable software libraries and licenses for use in QuesTec
Systems, in exchange for equity and royalty payments as described in
Section 2 above. These licenses will grant QuesTec exclusive use of
this software for sports applications
(c) retain ownership of the software developed by Atlantic
(d) participate in the integration of Atlantic software into the Systems,
and operational testing
(e) participate in Questec marketing activities; QuesTec will reimburse
travel expenses
(f) negotiate revenue sharing with QuesTec for any non-sports business
that QuesTec brings to Atlantic
(g) participate in the specification, development, and integration of any
signal processing technology acquired by QuesTec from a third party.
6. INSTALLATION SITES.
Atlantic acknowledges that QuesTec will be negotiating with networks and
sponsors to license use of the Systems during live sporting events. If
Questec finalizes an agreement regarding the use of the Systems, then
Atlantic agrees that it may assist in the installation and operation of the
Systems if requested by QuesTec. Sites at which the Systems will be used
shall be determined by QuesTec's clients.
7. NOTICES.
All notices, requests, instructions, consents and other communications to
be given pursuant to this Agreement shall be in writing and shall be deemed
received (i) on the same day if delivered in person, by same-day courier or
by facsimile transmission so long as confirmation of such transmission is
received; (ii) on the next day if delivered by overnight mail or courier;
or (iii) on the date indicated on the return receipt, or if there is no
such receipt, on the third calendar day (excluding Saturdays and Sundays),
if delivered by certified or registered mail, postage prepaid, to the party
for whom intended to the following address:
If to QuesTec:
QuesTec International, Inc.
000-X Xxxx Xxxxxxxx Xxxxx
Xxxx Xxxx, Xxx Xxxx 00000
Attn.: Xx. Xxxxxx X. Xxxxxxxxx
If to Atlantic:
Atlantic Aerospace Electronics Corporation
000 Xxxxxx Xxxx Xxxx
Xxxxxxx, XX 00000
Attn.: Xx. Xxxx Xxxx
Any party may, by written notice given to the other in accordance with this
Agreement, change the address or facsimile number to which notices to such
party are to be sent.
8. ENTIRE AGREEMENT; AMENDMENT.
This Agreement constitutes the entire agreement and understanding between
the parties hereto, QuesTec and Atlantic acknowledge that there are no
representations, warranties, covenants, or agreements regarding the Systems
other than those contained herein. The provisions of this Agreement may be
amended, modified or waived only by writing and executed by both parties
hereto. Except as set forth in this Agreement, QuesTec has made no
representations or warranties of any kind with respect to rights granted
herein.
9. WAIVER.
No failure of QuesTec to exercise any right hereunder or to insist upon
strict compliance by Atlantic with the terms hereof, and no custom or
practice of the parties at variance with the terms hereunder, shall
constitute a waiver of QuesTec's right to demand exact compliance with the
terms of this Agreement. Waiver by QuesTec of any particular default by
Atlantic shall not affect or impair QuesTec's rights in respect of any
subsequent default of the same or of a different nature, nor shall any
delay or omission by QuesTec to exercise any rights arising from a default
impair its rights as to such default or any subsequent default.
10. GOVERNING LAW AND INTERPRETATION.
This Agreement shall be construed in accordance with the laws of the United
States and the state of New York, without reference to conflict to laws,
principles and the parties attorn to the jurisdiction and venue of the New
York courts.
11. ARBITRATION.
Any dispute between QuesTec and the Atlantic involving the interpretation
of this Agreement or the obligations of a party to it shall be determined
by binding arbitration in accordance with the arbitration rules of the
American Arbitration Association in the county of Suffolk, state of New
York. The arbitrator shall have the authority to permit discovery upon
request of a party. The cost of the arbitration shall be shared equally.
The arbitration award issued by the arbitrator may be enforced in any court
of competent jurisdiction in the United States.
12. HEADINGS.
The captions and headings contained in this Agreements are for reference
purposes only and shall not affect the interpretation or meaning of this
Agreement.
13. COUNTERPARTS.
This Agreement may be executed in several counterparts, each of which shall
be deemed an original, and all of such counterparts together shall
constitute one agreement, binding on all parties hereto. If a copy or
counterpart of this Agreement is originally executed and such copy or
counterpart is thereafter transmitted electronically by facsimile or
similar device, such facsimile document shall for all purposes be treated
as if manually signed by the party whose facsimile signature appears.
14. TERM.
This Agreement shall come into force upon signing, and shall continue in
full force according to the terms and conditions set forth in the Strategic
Alliance, Research and Development Agreement between QuesTec and Atlantic.
IN WITNESS WHEREOF, the parties to this Agreement have caused it to be executed
as of the day and year first written above.
"QuesTec"
QuesTec Imaging, Inc.
by: /s/ Xxxxxx X. Xxxxxxxxx
------------------------
Xxxxxx X. Xxxxxxxxx
by: /s/ Xxxxxxx X. Xxxxx
------------------------
Xxxxxxx X. Xxxxx
"Atlantic"
Atlantic Aerospace Electronics Corporation
by: /s/ Xxxxxx X. Xxxxxx
------------------------
Xxxxxx X. Xxxxxx
by: /s/ Xxxxxx X. Xxxxxxxxx
------------------------
Xxxxxx X. Xxxxxxxxx
