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EX. 10.13
DEVELOPMENT & OEM LICENSING AGREEMENT
This DEVELOPMENT & OEM LICENSING AGREEMENT is entered into and made
effective as of the 31st day of October, 1997 by and between TTR TECHNOLOGIES
LTD., a company formed under the laws of the State of Israel with an address at
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ ("TTR") and ▇▇▇▇ ▇▇▇▇▇▇ & ASSOCIATES
INC. , an Oklahoma corporation with its principal offices at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ("Licensee").
W I T N E S S E T H
WHEREAS, TTR is in the business of designing, developing, marketing and
distributing, inter-alia, optical media authenticity verification and software
protection products designed to prevent the unauthorized reproduction of
protected software applications and has developed proprietary technology which
prevents the faithful reproduction of optical media;
WHEREAS, Licensee is in the business inter alia of designing,
developing, marketing and supplying signal processing mastering interface system
configurations for use in the pressed optical media industry;
WHEREAS, TTR desires to grant Licensee, on an OEM basis, certain
exclusive, non-transferable rights to merge, link, bundle or otherwise integrate
TTR's DiscGuard System (as defined below) into Licensee's products, including
signal processing systems and to advertise, promote, market, distribute and
service the Enhanced MIS (as defined below), and Licensee wishes to accept and
exercise these rights, all on the terms contained herein.
NOW, THEREFORE, in consideration of the terms and conditions hereafter set
forth, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used herein, the following terms shall, unless the context otherwise
requires, have the following meanings ascribed to them:
1.1 "Enhanced MIS" shall mean the DiscGuard System integrated into a
MIS (as defined below) where such Enhanced MIS operating in
conjunction with DiscGuard Enabling Software and with a laser
beam recorder is able to produce a glass master capable of
producing DiscGuard Fingerprinted Discs
1.2 "Development License" is defined in Section 2.1.
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1.3 "Customer" shall mean an end-user of the Enhanced MIS or a
DiscGuard enhanced Signal Processing System.
1.4 "Confidential Information" means any (i) information or material
disclosed by one party hereto to the other orally or in writing
which the disclosing party designates in writing as confidential
at the time of disclosure, (ii) information disclosed orally by
one party hereto to the other that is designated orally as
confidential at the time of disclosure and that is described and
designated as confidential in a written notice from the
disclosing party to the receiving party within thirty (30) days
after such disclosure, (iii) secret information regarding the
internals of the DiscGuard System, whether or not specifically
designated as confidential, (iv) secret information regarding the
internals of the Licensee's products, whether or not specifically
designated as confidential and (v) information regarding
Licensee's customers, business or plans, whether or not
specifically designated as confidential. Notwithstanding the
foregoing, "Confidential Information" shall not include
information which: (i) becomes generally known other than through
the receiving party's breach of this Agreement or violation of
the disclosing party's rights under trade secrets or other law,
(ii) the receiving party independently develops without reference
to confidential information of the disclosing party or any third
party, or (iii) the receiving party acquires from a third party,
or develops based in part on information acquired from a third
party, without incurring any obligations of confidentiality
provided the third party acquired such information without there
having been a breach of a valid confidentiality agreement.
1.5 "DiscGuard System" is a TTR proprietary technology which prevents
the faithful reproduction of all types of optical media (CD-ROM,
CD-R, DVD-ROM, DVD-R etc.).
1.6 "DiscGuard Detecting Software" is software [utilizing a distinct
identification code] that enables an optical disc retrieval
system to determine whether a disc is protected by the DiscGuard
System.
1.7 "DiscGuard Enabling Software" is software used in conjunction
with an Enhanced MIS and which permits the Enhanced MIS to
produce DiscGuard protected CD-ROMs and DVDs.
1.7 "DiscGuard Workstation Software" is a graphical user interface
and software used to encrypt publisher applications to protect
them from running unless such applications are on an authentic
original disc;
1.8 "Fingerprinted Disc" is a CD-ROM or DVD disc with a
non-reproducible DiscGuard digital fingerprint that can be
detected during retrieval to verify that the media is an
authentic original.
1.9 "Distributor" shall mean a party that is authorized by Licensee
to market or license or distribute any MIS.
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1.10 "Licensed Intellectual Property" means all Israel and foreign
copyrights (including without limitation all renewals and
extensions thereof), registrations and applications for
registration of copyright, patents (including without limitation
continuations, continuations-in-part, reissues and extensions
thereof), applications for patent (including without limitation
divisions thereof), trade secrets and other intellectual property
rights, whether now existing or hereafter created, developed,
arising or otherwise coming into being, that relate to or cover
any of DiscGuard System or part thereof, including without
limitation any intellectual property rights that could be
violated, infringed or misappropriated by any copying,
manufacture, use, performance, distribution or other exploitation
of DiscGuard system or part thereof.
1.11 "Mastering Interface System(s) ("MIS")" includes a
software/hardware configuration which formats data and feeds the
same to a laser beam recorder (the "LBR") that is used in the
pressed optical media industry to produce a glass master (used to
produce metal stampers which are, in turn used in replicating
machines to mass-produce CD-ROMs and DVDs), where such MIS
utilizes a Signal Processing System (as defined below) that is
proprietary to the Licensee; and where such MIS is proprietary to
the Licensee or for which Licensee has exclusive manufacturing
rights and sells or leases such MIS to a Customer in the regular
course of business.
1.12 "Subsidiaries" shall mean companies in which a party owns more
than 50% of the equity and has voting control.
1.13 "Signal Processing System" shall mean any system configuration
designed to provide a modulated signal for creating pre-recorded
master discs used to produce CDs and DVDs.
ARTICLE II
GRANT OF LICENSE; UNDERTAKING TO INTEGRATE DISCGUARD;
2.1 Grant of Development License. TTR hereby grants to Licensee an
exclusive, non-transferable license under the Licensed
Intellectual Property to merge, link, bundle or otherwise
integrate the DiscGuard System into the MIS and Licensee's Signal
Processing Systems in order to complete the Development defined
in Section 3.2 (the "Development License").
2.2 Grant of License. Upon and subject to the completion of the First
Run, as specified in Section 3.4, TTR hereby grants to Licensee
an exclusive, non-transferable, royalty-free world-wide license
under the Licensed Intellectual Property to (hereinafter, the
"License"):
(i) merge, link, bundle or otherwise integrate the DiscGuard
System into the MIS or Licensee's Signal Processing System
to produce the Enhanced MIS or a DiscGuard enhanced Signal
Processing System; and
(ii) market, distribute, sell and/or license the Enhanced MIS
or DiscGuard
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enhanced Signal Processing System, directly and indirectly
through Subsidiaries and Distributors (the "Sublicensees")
to Customers.
The license granted pursuant to this Section 2.2 (ii) shall be
exclusive for the period from the date of its grant up to and
including December 31, 1998; PROVIDED, THAT, in the event
Licensee shall have sold or upgraded 100 units of MIS to which
DiscGuard can be integrated to become an Enhanced MIS by such
date, then the exclusivity granted hereunder shall thereafter be
extended through December 31, 1999 (the "Exclusive License").
Within three (3) months preceding December 31, 1999, the Company
and Licensee shall confer for the purpose of establishing
mutually acceptable annual minimum unit sales or upgrading
requirements for purposes of renewing or extending the Exclusive
License. Subsequent extensions of the period of the Exclusive
License, if any, shall be subject to the negotiation and approval
by each of the parties of such additional terms and conditions,
including minimum unit sales or upgrading requirements, as each
may, in its sole discretion, deem necessary or desirable.
So long as the Exclusive License shall remain in effect in
accordance herewith, with respect to pre-recorded CD and DVD
discs, TTR shall not authorize any party other than Licensee to
provide Signal Processing Systems which utilize or work in
conjunction with the DiscGuard System.
2.3 TTR Direct Sales and Additional OEM Agreements; Restrictions. It
is understood between the parties that the intent of this
Agreement is that Licensee will use its best efforts to cause its
Enhanced MIS or DiscGuard enhanced Signal Processing System
products to function in harmony with TTR's DiscGuard System and
that TTR will market and sell the DiscGuard System directly to
Customers, software and electronic content providers, title
publishers and others. Nothing contained herein grants, or shall
be deemed or interpreted to grant, to Licensee a license or the
right to distribute or exploit in any manner (i) the DiscGuard
System (or any component thereof) as a stand-alone product (ii)
the DiscGuard Detecting Software or (iii) the DiscGuard
Workstation Software or (iv) the DiscGuard Enabling Software.
Additionally, this Agreement shall not be construed to limit or
restrict TTR (other than as set out in Section 2.2(ii) above with
respect to MIS or DiscGuard enhanced Signal Processing Systems)
in any way from (i) promoting, granting licenses to and
installing the DiscGuard System and other TTR products at any
location and at any end-user customer's facilities, whether
directly, indirectly, or through a distributor, agent or
subsidiary and (ii) granting resale, distribution and OEM
licenses relating to the DiscGuard System to third-parties.
2.4 Restricted Uses. Licensee is prohibited from changing,
developing, enhancing or otherwise modifying the DiscGuard System
(or any component thereof) in any way whatsoever. Licensee shall
obtain written undertakings from its Sublicensees or to ensure
that such persons are bound by a like covenant of restriction
with respect to the use of the Product.
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ARTICLE III
DEVELOPMENT OF ENHANCED MIS
3.1 General. This section sets forth the detailed agreement under
which the DiscGuard System will be integrated into MIS for
purposes of developing the Enhanced MIS. It is expected that the
above integration will proceed with all due diligence and that
the milestone dates set forth in Exhibit A will be met. Each of
TTR and Licensee recognizes that the completion of this project
within the time schedule set forth herein is fundamental to this
Agreement and contemplates the continuing cooperation and good
will of each party and the assignment to the project of competent
personnel from each side. Except for any work product developed
which relates to the DiscGuard System, the Licensed Intellectual
Property and other related technologies that are proprietary to
TTR, Licensee shall be the sole owner of all work product
developed pursuant to this Agreement (whether or not embodied
within any of Licensee's products) and TTR shall have no rights,
title and interest therein.
3.2 Development Tasks. Licensee and TTR shall perform their
respective development tasks specified in Exhibit A in accordance
with the development schedule specified therein and the design
specifications specified in Exhibit B (the "Development").
3.3 Acceptance Testing. Upon completion of the Development as herein
provided, TTR shall have ten (10) days in which to review and
conduct testing of the Development to determine, in its sole
discretion, whether same is acceptable. In the event that
following such tests TTR reasonably determines that the
Development is not acceptable, TTR shall so notify Licensee in a
writing, setting forth in reasonable detail its objections.
Within thirty (30) days after delivery of such notice, Licensee
and TTR shall use their best efforts to deliver an Acceptable
version of such Development.
3.4 First Run Sample CDs. Subject to the terms and conditions of a
written agreement to be entered into by TTR and Nimbus CD
International Inc., a Delaware corporation ("Nimbus") which is in
the business of replicating optical media, upon acceptance by TTR
of Development as provided in Section 3.3, Licensee shall use its
best efforts to (i) install the Enhanced MIS into a mastering
machine owned and operated by Nimbus at Nimbus's facility in
Virginia, and (ii) support a sample test run with respect to the
processing component of Licensee's Signal Processing System,
according to the specifications described in a written agreement
with Nimbus, of 1,000 sample Fingerprinted Discs (CD-ROMs) (the
"First Run"). Any financial arrangements related to Nimbus
procuring Licensee's signal processing equipment for use in the
First Run shall be determined between Licensee and Nimbus.
3.5 Termination of Development License. In the event that TTR does
not accept the Development as provided in Section 3. then TTR
may, at its option and upon written notice to Licensee, terminate
forthwith the Development License.
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ARTICLE IV
MANNER OF DISTRIBUTION TO LICENSEE; UNDERTAKINGS OF LICENSEE
4.1 Copies to Licensee; Accompanying Documentation. (i) Promptly upon
the execution of this Agreement, TTR shall provide Licensee with
all of the methods, processes, procedures, knowhow, software and
other materials to use the Licensed Intellectual Property as
provided for herein to the extent necessary for the Development
License.
In the event that a License is entered into pursuant to Section
2.2 hereunder, for the duration of the License, TTR shall provide
to Licensee, within five (5) Business Days' of its availability
for commercial distribution, DiscGuard System upgrades or
improvements, if any.
4.2 Undertakings of Licensee. Licensee hereby undertakes that for so
long as this Agreement is in force and effect, it will use its
best efforts, in order to complete the Development of the
Enhanced MIS and to bundle and integrate the DiscGuard System
with MIS, as provided for hereunder.
In the event that the License is granted in accordance with the
provisions of Section 2.2, the Licensee undertakes to perform
each of the following:
(i) Integration of the Product. For the duration of the
Exclusive License, Licensee will integrate the DiscGuard
System with all of its MIS, as provided for hereunder;
(ii) Sale of Enhanced MIS. For the duration of the Exclusive
License the Licensee shall use its best efforts to sell
the Enhanced MIS to new Customers and to prior purchasers
of MIS;
(iii) Sublicensees. Every agreement entered into by Licensee
with a Sublicensee shall be no less protective of TTR's
rights than as provided for in this Agreement. In
addition, Licensee agrees to provide to its Customers the
documentation attached to this Agreement as Exhibit C
informing them of the DiscGuard System. This information
documentation may be changed from time to time as agreed
to in writing by the parties hereto. Both parties shall
act in good faith in the development of such
documentation. It is understood that this documentation is
to be of approximately one (1) sheet of printed material;
(iv) Networking. TTR understands that Licensee, by the
nature of its products and position in the industry,
supports and enables a variety of formats, technologies
and functionalities, some of which are
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competitive to TTR. Given Licensee's unique position, it
must maintain a proper balance of advocacy and objectivity
with respect to the various formats, technologies and
functionalities. Licensee is willing and able, however, to
provide TTR with certain information which may be used by
TTR in its efforts to promote, market and sell its
DiscGuard System. On or before the first day of January,
April, July and October of each year during the term of
this Agreement, Licensee shall provide TTR with a written
statement setting forth, in reasonable detail, in respect
of the previous three month period, information relating
to (A) the number and type of Enhanced MISs or DiscGuard
enhanced Signal Processing Systems developed and sold or
licensed and the (B) names and addresses of all
Sublicensees and Customers. Licensee agrees that it will
in good faith advocate no less than balanced treatment of
TTR's technology vis a vis other competing technologies
when the issue arises with respect to standard setting
groups under circumstances wherein Licensee is involved in
providing input to such groups related to such technology.
(v) Competitive Products. TTR understands that Licensee
supports and facilitates a wide variety of third party
technologies, some of which may be competitive with the
DiscGuard System. In the course of carrying out Licensee's
business, Licensee will maintain objectivity with respect
to the various technologies which may be competitive with
the DiscGuard System and will not advocate any particular
technology (or derivative product or component) at the
expense of DiscGuard.
4.3 Undertakings of TTR. TTR shall use its best efforts to introduce
Licensee to software and electronic content developers and title
publishers who are customers of TTR.
ARTICLE V
PROPRIETARY RIGHTS
5.1 Title to Products. Licensee acknowledges that all of the Licensed
Intellectual Property is the sole property of TTR., and Licensee
shall not obtain any interest of any kind in the DiscGuard System
by or through this Agreement except as contemplated herein. Any
modifications, enhancements or improvements relating to the
DiscGuard System (whether or not resulting from the
implementation of this Agreement) which are discovered, invented
or first reduced to practice by the Licensee shall be the sole
and exclusive property of TTR, subject to a license, on the terms
set forth herein, in favor of Licensee. License acknowledges that
this declaration is vital to TTR and without it TTR would not
enter into this Agreement. TTR shall provide Licensee with form
of TTR's patent notice which will be included with each Enhanced
MIS.
Likewise, TTR acknowledges that all of the Licensee's products
are the sole property of Licensee (including but not limited to
the components of such products which interact with, enable or in
any way facilitate the functioning of
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the DiscGuard System in coordination them), and TTR shall not
obtain any interest of any kind in the Licensee's products or any
part of them by or through this Agreement. Any modifications,
enhancements or improvements relating to the Licensee's products
(whether or not resulting from the implementation of this
Agreement) which are discovered, invented or first reduced to
practice by the Licensee shall be the sole and exclusive property
of the Licensee. TTR acknowledges that this declaration is vital
to Licensee and without it Licensee would not enter into this
Agreement.
5.2 Trade Secrets. Licensee acknowledges that the DiscGuard System
contains trade secrets which are the sole property of TTR and
which are confidential and are not in the public domain, the
unauthorized use or disclosure of which may cause irreparable
harm to TTR.
TTR acknowledges that the Licensee's products contain trade
secrets which are the sole property of Licensee and which are
confidential and are not in the public domain, the unauthorized
use or disclosure of which may cause irreparable harm to
Licensee.
5.3 Trade Names, Trademarks and Service Marks. Licensee acknowledges
that the trade names, trademarks and service marks used by TTR in
relation to its DiscGuard System, are the exclusive property of
TTR. Licensee agrees that it shall not hold itself out as having
acquired any proprietary right to any trade name, trademark, or
service ▇▇▇▇ of TTR by virtue of its use thereof or anything
herein, except as specifically set forth in this Agreement, and
any such right shall immediately cease upon the termination or
cancellation of this Agreement.
Licensee is expressly authorized to use such trade names,
trademarks and service marks in promoting, marketing, selling,
licensing and supporting its products with respect to their
functionality in supporting the DiscGuard System.
The authorization contained herein to use and authorize the use
of any trademarks or tradenames shall cease by the ninetieth
(90th) day after Licensee has received written notice from TTR to
the effect that such tradenames or trademark has been superseded
or replaced by a new tradename or trademark.
TTR acknowledges that the trade names, trademarks and service
marks used by Licensee in relation to its products are the
exclusive property of Licensee. TTR agrees that it shall not hold
itself out as having acquired any proprietary right to any trade
name, trademark, or service ▇▇▇▇ of Licensee by virtue of its use
thereof or anything herein, except as specifically set forth in
this Agreement, and any such right shall immediately cease upon
the termination or cancellation of this Agreement. TTR is
expressly authorized to use such trade names, trademarks and
service marks in promoting, marketing, selling, licensing and
supporting its DiscGuard System with respect to such products'
functionality in supporting the DiscGuard System.
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The authorization contained herein to use and authorize the use
of any trademarks or tradenames shall cease by the ninetieth
(90th) day after TTR has received written notice from Licensee to
the effect that such tradenames or trademark has been superseded
or replaced by a new tradename or trademark.
ARTICLE VI
REPRESENTATIONS & WARRANTIES
6.1 TTR's Representations and Warranties. TTR hereby represents and
warrants to Licensee that:
(i) TTR is a private company duly formed and validly existing
under the laws of the State of Israel;
(ii) TTR has the necessary corporate power and authority to
enter into this Agreement and to perform hereunder, and
TTR's execution, delivery and performance of this
Agreement has been duly authorized by all necessary
corporate actions;
(iii) Neither the execution or delivery of this Agreement nor
the performance by TTR hereunder will violate any
provision of TTR's charter documents or articles any
agreement by which it is currently bound;
(iv) TTR owns and has all of the rights to the intellectual
property incorporated into the DiscGuard System which are
necessary for TTR to grant the Licenses and perform all of
its obligations under this Agreement.
6.2 Licensee's Representations and Warranties. Licensee hereby
represents and warrants to TTR that:
(i) Licensee is a private company duly formed and validly
existing under the laws of the State of Oklahoma;
(ii) Licensee has the necessary corporate power and authority
to enter into this Agreement and to perform hereunder, and
Licensee's execution, delivery and performance of this
Agreement has been duly authorized by all necessary
corporate actions; and,
(iii) Neither the execution or delivery of this Agreement nor
the performance by Licensee hereunder will violate any
provision of Licensee's charter documents or articles or
any agreement by which it is currently bound.
ARTICLE VII
WARRANTIES, LIABILITY & INDEMNIFICATION
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7.1 Warranties. IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR
PURPOSE, SATISFACTION AND MERCHANTABILITY SHALL NOT APPLY TO
DISCGUARD SYSTEMS, OR TO MIS, ENHANCED MIS OR ANY OTHER OF
LICENSEE'S PRODUCTS.
7.2 Limitation on Liability. IN NO EVENT SHALL EITHER PARTY BE LIABLE
IN RESPECT OF OR ARISING OUT OF THE PERFORMANCE AND/OR BREACH OF
ITS OBLIGATIONS HEREUNDER FOR ANY INDIRECT, INCIDENTAL OR SPECIAL
OR CONSEQUENTIAL DAMAGES, INCLUDING LOSS OF PROFITS, REVENUE,
DATA OR USE, INCURRED BY THE OTHER PARTY WHETHER IN AN ACTION IN
CONTRACT OR TORT, EVEN IF THAT PARTY OR ANY OTHER PERSON HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
7.3 Indemnity. TTR shall indemnify and hold Licensee and its
Subsidiaries and their customers harmless from all loss, damage
and/or expenses (including attorney's fees) arising out of any
claims by third parties that the use of the DiscGuard System
furnished to Licensee hereunder infringes any patent, trademark,
copyright or other proprietary interest. Licensee shall promptly
notify TTR in writing of such claim and permits TTR to control
the defense or settlement thereof. TTR shall vigorously defend
against any such claim. TTR may, at its sole option and expense
(i) procure for the Licensee the right to continue using the
infringing product (ii) modify the infringing product so that it
is noninfringing (iii) procure a replacement product that has
substantially the same functionality, or if none of the above
options is reasonably available (iv) terminate this Agreement and
all sublicenses granted hereunder. The foregoing obligation will
not cover any claim of infringement solely resulting from the use
of the Enhanced MIS or Licensee's DiscGuard enhanced Signal
Processing Systems, if such infringement could have been avoided
by use of the DiscGuard System alone.
Licensee shall indemnify and hold TTR harmless from all loss,
damage and/or expenses (including attorney's fees) arising out of
any claims by third parties that the use of its products in
combination with the DiscGuard System furnished to the Licensee
hereunder infringes any patent, trademark, copyright or other
proprietary interest. TTR shall promptly notify Licensee in
writing of such claim and permit Licensee to control the defense
or settlement thereof. Licensee may, at its sole option and
expense (i) procure for the TTR the right to continue using the
infringing product (ii) modify the infringing product so that it
is noninfringing (iii) procure a replacement product that has
substantially the same functionality, or if none of the above
options is reasonably available (iv) terminate this Agreement.
The foregoing obligation will not cover any claim of infringement
solely resulting from the use of such product in combination with
DiscGuard, if such infringement could have been avoided by use of
the License's product alone.
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7.4 No Unauthorized Use or Disclosure. Each party shall: (i) hold in
confidence, and not disclose or reveal to any person or entity,
any Confidential Information of the other party without the clear
and express prior written consent of a duly authorized
representative of such other party, except that a party receiving
Confidential Information from the other party may reveal such
information solely to its employees or contractors or consultants
who require such disclosure to allow such receiving party to
perform its obligations or exercise its rights under this
Agreement and who agree in writing to refrain from making any
unauthorized use or disclosure thereof; and (ii) not use any
Confidential Information of the other party for any purpose at
any time, other than for the purpose(s) of performing its
obligations or exercising its rights under this Agreement. Each
party shall protect the Confidential Information of the other
party using at least the same degree of care it uses to protect
its own proprietary and confidential information and materials of
like importance, but in no event less care than a reasonably
prudent business person would take in a like or similar
situation. Each party shall return any Confidential Information
of the other upon written request, except to the extent that
doing so would undermine or interfere with the exercise by the
receiving party of its rights under this Agreement. These
obligations of confidentiality shall relate back to the date of
the original nondisclosure agreement between the parties and to
the Memorandum of Understanding dated April 14, 1997, and shall
cover all confidential information exchanged between the parties
pursuant to those documents.
7.5 Disclosure Of Confidential Information Pursuant To Subpoena. If a
party to this Agreement is served with a subpoena which seeks to
compel the production of Confidential Information of the other
party to this Agreement, the party upon whom such subpoena is
served shall immediately give written notice of such subpoena to
the other party to this Agreement, unless such party is
prohibited by law from providing such notice. The parties to this
Agreement shall then cooperate with one another for the purpose
of obtaining such relief as will protect the Confidential
Information. Should a motion be timely filed and served and the
party upon whom such subpoena is served is notified in writing
thereof before the date upon which such production is requested,
the party upon whom such subpoena is served shall not comply with
such subpoena until after such time as the court rules on the
subject motion. Should such order be obtained, the party upon
whom such subpoena is served shall comply with the order. Should
no such motion be filed before the scheduled production date, the
party upon whom such subpoena is served may comply with such
subpoena.
7.6 Terms of Agreement. Each party shall treat the terms of this
Agreement as confidential and shall not disclose such terms,
except that disclosure of such terms shall be permitted (i) as
provided in Section 7.5 with respect to Confidential Information,
(ii) to accountants, attorneys and other professionals providing
services to the disclosing party to the extent that such
professionals are notified of the confidential nature of such
terms.
7.7 No Compete. ******* Confidential material omitted and separately
filed with the SEC.
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ARTICLE VIII
DEFAULT & TERMINATION
8.1 Effectiveness; Term of Agreement. This Agreement shall become
effective upon signature by each of the parties hereto and,
unless terminated as herein provided, shall continue in full
force and effect for five (5) years thereafter, unless extended
in accordance with the provisions of Section 2.2(ii); provided,
that, this Agreement shall be automatically renewable for
additional one (1) year periods upon expiry subject to the mutual
written agreement of the parties
8.2 Right to Terminate.
(i) TTR shall be entitled to terminate the Development License
and this Agreement in the event that TTR shall determine
the Development is not acceptable in accordance with the
provisions of Section 3.3 hereof,
(ii) TTR shall be entitled to terminate the Development License
and this Agreement in the event that the First Run is not
completed to TTR's satisfaction by in accordance with the
provisions of Section 3.4,
(iii) Either party may terminate this Agreement upon the other's
breach of a material term, covenant or undertaking in this
Agreement if, within thirty (30) days following the
delivery of a written notice to the defaulting party
setting forth in reasonable detail the basis of such
default and the remedial action required to be taken to
rectify such default, the defaulting party has not
rectified such default to the reasonable satisfaction of
the non-defaulting party .
(iv) Either Party hereto may, at its option terminate this
Agreement should the other Party hereto:
(a) Admit in writing its inability to pay its debts
generally as they become due
(b) Make a general assignment for the benefit of
creditors.
(c) Institute proceedings to be adjudicated a voluntary
bankrupt, or consent to the filing of a petition of
bankruptcy against it.
(d) Be adjudicated by a court of competent jurisdiction
as being bankrupt or insolvent.
(e) Seek reorganization under any bankruptcy act, or
consent to the filing of a petition seeking such
reorganization; or
(f) Have a decree entered against it by a court of
competent
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jurisdiction appointing a receiver, liquidator,
trustee, or assignee in bankruptcy or in insolvency
covering all or substantially all of such party's
property or providing for the liquidation of such
party's property or business affairs.
Notwithstanding anything to the contrary contained herein, for a
period not exceeding ninety (90) days following the effective
termination (for whatever reason) of this Agreement, Licensee and
Sublicensees shall be permitted to continue to distribute their
existing inventory of the Enhanced MIS, subject to (and in
accordance with) the terms and conditions contained in this
Agreement.
8.3 Effect of Termination or Expiration. Upon the termination
of this Agreement for any reason whatsoever:
(a) the rights of Licensee and its Sublicensees to
continue distributing the Enhanced MISs shall cease;
provided, however, that all end-user Enhanced MIS licenses
properly granted by Licensee or Sublicensees prior to such
termination shall continue in full force and effect in
accordance with their terms;
(b) Licensee shall, and shall cause its Sublicensees,
promptly return to TTR, erase and/or destroy all
materials, copies of documentation and all information and
literature relating to DiscGuard System which shall have
been provided by TTR to Licensee or reproduced by Licensee
(or by such Sublicensees); provided, however, that
Licensee may retain sufficient and reasonable material and
a number of copies of the documentation to enable Licensee
to continue to provide maintenance services to its
installed base of Customers. Upon such return, erasure
and/or destruction, Licensee shall confirm in writing to
TTR that it has complied with its obligations under this
paragraph.
(c) Each party shall promptly return to the Disclosing
Party, and/or erase or destroy all copies of any
Confidential Information in the possession of such party
or its Subsidiaries, provided, however, that Licensee may
retain sufficient and reasonable material and a number of
copies of the documentation to enable Licensee to continue
to provide maintenance services to its installed base of
Customers.. Upon such return, erasure and/or destruction,
such party shall confirm in writing to the Disclosing
Party that it has complied with its obligations under this
section.
8.4 Survival. Articles V, VII, VIII, and IX of this Agreement shall
survive the termination and/or expiration of this Agreement for
any reason whatsoever.
ARTICLE
MISCELLANEOUS
9.1 Relationship. The relationship between TTR and Licensee is that
of
14
independent contractors and parties to a license for the Products
in accordance with this Agreement. Neither party is in any way
the agent or attorney in fact of the other, nor shall either
party or any of its respective agents or employees have any power
or authority to assume any obligation of any kind, implied or
expressed, on behalf of the other or to bind the other to any
contract, commitment or agreement whatsoever, or to make any
representation on the other's behalf. This Agreement shall not be
construed as constituting either party as the partner or joint
venture of the other, nor to create any form of legal association
which would impose liability upon one party for the acts or
failures to act of the other.
9.2 Force Majeure. Neither party shall be liable for reasonable
delays in the performance of its obligations under this Agreement
which result from causes beyond its reasonable control, including
without limitation acts of God, strikes, war, riot, civil
disorder, embargo, acts of civil and military authorities, fire,
earthquake, flood or inability to obtain labor or materials.
9.3 Assignability; Binding Effect. Licensee may not assign this
Agreement without the prior written consent of TTR, which consent
shall not be unreasonably withheld or delayed, except that, upon
notice to the other party but without any requirement to obtain
consent, (i) Licensee may assign this Agreement in connection
with the sale or other transfer of substantially all of its
operating assets relating to all of its MIS, other than a sale to
a direct competitor (or affiliate of a direct competitor) of TTR.
Subject to the provisions of this Section, this Agreement shall
be binding upon and shall inure to the benefit of the parties
hereto and their respective successors and assigns.
9.4 Entire Agreement. This Agreement, including all recitals in the
preamble hereto and Exhibits attached hereto, sets forth the
entire agreement and understanding between the parties, contains
all the understandings, inducements, promises and representations
between the parties relating to the matters referred to herein,
and merges and supersedes all prior agreements, commitments,
arrangements, representations, writings and discussions between
them, whether written or oral, provided, however, that the
confidentiality provisions of any prior nondisclosure agreement
between the parties shall remain in full force and effect
according to their terms.
This Agreement may not be modified or amended except by a written
supplement, duly executed by each of the parties.
9.5 Notices. Any notice, demand or communication which under the
terms of this Agreement or otherwise must or may be given or made
by TTR or Licensee shall be in writing and shall be given or made
by facsimile with confirmation of receipt, certified or
registered air mail, return receipt requested, or any delivery
services, requiring signature of receipt, addressed to the
respective parties as follows:
15
Licensee
TTR
TTR TECHNOLOGIES LTD.
▇ ▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇
FAX: ▇▇▇▇ ▇ ▇▇▇-▇▇▇▇
Such notice, demand or other communications shall be deemed to
have been given on the date confirmed as the actual date of
delivery by the delivery service if sent by such service, and in
the case of certified or registered air mail - fifteen (15) days
following the date on which it was deposited postage prepaid in
the U.S. or Israeli mail (or the date shown on the actual mail
receipt if it is earlier).
The above addresses may be changed at any time by giving prior
written notice as provided above.
9.6 Severability. Each provision of this Agreement or part thereof
shall be severable. If, for any reason, any such provision or
part thereof is finally determined, by a court of agency having
valid jurisdiction, to be invalid and contrary to, or in
conflict with, any existing or future law or regulation, such
determination shall not impair the operation of or affect the
remaining provisions of this Agreement, and such remaining
provisions will continue to be given full force and effect and
shall continue to bind the parties.
9.7 Enforcement. The respective rights and remedies of each party are
cumulative, and no exercise or enforcement by either party of any
right or remedy hereunder shall preclude the exercise or
enforcement by such party of any other right or remedy hereunder,
or which such party is entitled by law to enforce. Each party may
waive any obligation of or restriction upon the other party under
this Agreement only in writing. No failure, refusal, neglect,
delay, waiver, forbearance or omission of either party to
exercise any right under this Agreement or to insist upon full
compliance by the other with its obligations hereunder shall
constitute a waiver or any provision of this Agreement.
9.8 Construction. The headings appearing at the beginning of each
section of this Agreement are for convenience only and shall not
in any way affect the meaning or interpretation of this
Agreement. The recitals shall be deemed to be part of
16
this Agreement. From time to time this Agreement and any of the
Exhibits hereto may be modified by the parties in accordance with
Section 9.4 of this Agreement. As so modified, such exhibits
shall be considered part of this Agreement.
9.9 Dispute Resolution; Governing Law. This Agreement shall be
construed and enforced in accordance with the substantive laws of
(i) the State of Oklahoma applicable to contracts wholly executed
and performed therein in any action instituted by TTR and
(ii) the State of New York, in any action instituted by the
Licensee. The Parties agree and consent to the jurisdiction
of the courts in the location of the defendant in any action
(which in the case of TTR shall be New York, NY and in the case
of Licensee shall be Cushing, Oklahoma).
9.10 Press Releases. The parties shall issue a media release to the
public (in a form that has been approved in writing by both
parties) to announce the business relationship being created by
this Agreement.
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
duly executed on its behalf as of the date first written above.
TTR TECHNOLOGIES LTD.
By: ________________
Title:
▇▇▇▇ ▇▇▇▇▇▇ AND ASSOCIATES INC.
By: __________________
Title:
17
Exhibit "A"
3.2: Development Tasks and Development Schedule; Milestone Dates
***** material omitted for reasons of confidentiality and filed separately with
the Securities and Exchange Commission
18
Exhibit "B"
3.2: Design Specifications
******* Confidential material omitted and filed separately with the Securities
and Exchange Commission
19
Exhibit "C"
4.2 (iii): Sample Documentation to be provided with Enhanced MIS
******* Confidential material omitted and filed separately with the Securities
and Exchange Commission.
