1
EXHIBIT 10.15
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
MARKETING AND DISTRIBUTION AGREEMENT
BETWEEN XXXXXXX KODAK COMPANY AND LIFE F/X, INC.
This worldwide marketing and Distribution Agreement is entered into as
of this ___ day of January, 2001, by and between Xxxxxxx Kodak Company, a New
Jersey corporation with its principal office at 000 Xxxxx Xxxxxx, Xxxxxxxxx,
Xxx Xxxx 00000 ("Kodak") and Lifef/x, Inc., a Nevada corporation with its
principal office at 000 Xxxxxxx Xxxxxx, Xxxxxx, XX ("Life F/X"), hereinafter
referred to collectively as the Parties.
WHEREAS, Life F/X has developed software (the "Software") which is capable of
transforming a digital image of a face ************************************
***************** that can move, talk, and express emotion when played on a
Life F/X player such as Genesis or Babble, as more fully described below, and
WHEREAS, Kodak has a various channels of distribution through which it can
distribute the Genesis and Babble Software and Stand-Ins generated by the
Jetson Software (as all such terms are defined below).
Therefore, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties mutually agree as follows:
1. TERM. This Agreement is binding as of the date on which it is fully executed
by the Parties ("Effective Date") and will continue from the date of such
execution until the date that is three (3) years plus ninety (90) days from the
date on which the Jetson Software (as defined below) is accepted by Kodak for
commercialization purposes pursuant to Section 3(c)ii.
2. DEFINITIONS. "Software" as used in this Agreement shall mean the following
items of software:
a. GENESIS SOFTWARE: as used in this Agreement shall mean the software
program developed by Life F/X (or its licensors) with which digital
humans using text-to-speech (TTS) synthesis can be used on Windows based
personal computers (W98/ME/NT/2K), and can be transmitted and played on
the internet at 28.8kbps or greater modem speeds.
b. BABBLE SOFTWARE: as used in this Agreement shall mean the software program
developed by Life F/X (or its licensors) that can perform all of the
functions of the Genesis Software and is also able to lip-sync a digital
human to an actual human voice.
x. XXXXXX SOFTWARE: as used in this Agreement shall mean the software
program developed by Life F/X (or its licensors) that will allow for the
creation of Stand-Ins that when used with the Babble Software or another
Life F/X player, are email enabled and will have any other functionality
described in Exhibit A. Such software shall be capable of transforming
(with human intervention for the purposes described in Exhibit A) a
digital image of a face (provided by a consumer or professional
photographer) that meets Life F/X's minimum criteria into *******
***************** that can move, talk and express emotion when used with
the Babble Software or another Life F/X player. The minimum criteria for
use of the
1
2
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
digital image is set forth in Exhibit A hereto. Additionally, the
*********************** created by the Jetson Software shall be able
to lip-sync either synthesized or actual voice messages provided by
the consumer and generate facial movements and expressions in a
photo-realistic manner when used with the Babble Software or another
Life F/X player. The Jetson Software shall enable the creation of
digital Stand-Ins in less than one minute on PC servers when used and
configured in an "appropriate system." When used with Babble or
another Life F/X player, the Stand-Ins can be transmitted and played
on the internet at modem speeds of 28.8kbps or greater. An
"appropriate system" consists of networked Wintel systems with the
most up-to-date CPU and hardware architecture available at the time
the Jetson Software is configured as specified by Life F/X as single
or multi processors. The Jetson Software shall substantially conform
to specification requirements listed in Exhibit A hereto. The Jetson
Software includes the ability to create a Stand-In that when used with
the Babble Software or another Life F/X player can be used for ******
purposes but does not include creating Stand-Ins that are enabled for
******** use. If Life F/X obtains appropriate access to the relevant
hardware and software architecture, the Stand-In created by the Jetson
Software will also include the ability, when used with the Babble
Software or another Life F/X player, to be used for ****************
**********
d. STAND-IN: as used in this Agreement shall mean the *****************
digital reproduction of a photographic image of a face that can move,
talk and express emotion in a photo-realistic manner when used with
Babble or another Life F/X player.
e. RELATED SOFTWARE ACCESSORIES: as used in this Agreement shall mean
accessories and additional. Jetson Software functionality and/or
capabilities as the parties may mutually agree to develop during the
term of this Agreement.
f. **************************** as used in this Agreement shall mean the
process by which Life F/X can cause a Stand-In developed with the
Jetson Software to be ***************************** when used with the
Babble Software or another Life F/X player.
g. ***************** IMAGE: as used in this Agreement shall mean a
Stand-In ***********************************************************
********************************************************************
has limited head motion and accuracy.
h. ALPHA VERSION: as used in this Agreement shall mean a version
comprising a prototype or proof of concept that includes major
functions, but which is not fully operational.
i. BETA VERSION: as used in this Agreement shall mean a version that
includes all agreed functionality, but perhaps requiring additional
testing in a controlled customer environment, with subsequent
modifications to the product, documentation or packaging prior to full
release of the product.
2
3
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
j. FACILITY: as used in this Agreement shall mean a production site which
receives digital images from consumers or professional photographers
and converts these images to Stand-ins using the Jetson Software.
k. WEB ENABLED MARKETS OR ACCOUNTS: as used in this Agreement shall mean
the sale of Web Enabled Stand-Ins.
l. KODAK'S *********************** as used in this Agreement means that
division of Kodak focused on the **************** market, as such
division has been previously identified by Kodak in its annual reports
to shareholders.
3. KODAK OBLIGATIONS
a. WITH RESPECT TO GENESIS SOFTWARE: Upon the execution of this
Agreement, Kodak will use commercially reasonable efforts to:
(i) distribute the Genesis Software on the ************************
***********************************************************
******* and, until the Babble Software is available, on
subsequent versions of the Kodak ***********
(ii) distribute the Genesis Software on ********* and other Kodak
***********************************************************
************************************************** until the
Babble Software is available; and
(iii) include a "Powered by Life F/X" ingredient brand in proximity or
conjunction with the Genesis Software on the Kodak ********
********* promotional material and content that includes or
otherwise uses the Genesis Software.
b. WITH RESPECT TO BABBLE SOFTWARE: Upon release of the Babble Software
Kodak will use commercially reasonable efforts to distribute the
Babble Software on the next available release version of the Kodak
********** and, for so long as this Agreement is in effect on
subsequent versions of the Kodak *********************** and on other
current and future Kodak ***************** retail outlets, marketing
partnerships and distribution channels. To the extent that Kodak
distributes the Babble Software, it will include a "Powered by Life
F/X" ingredient brand in proximity or conjunction with the Babble
Software on the Kodak ******************** promotional material and
content that includes or otherwise uses the Babble Software.
c. WITH RESPECT TO JETSON SOFTWARE:
(i) Within 30 days of its receipt of an Alpha Version of the Jetson
Software, Kodak will provide Life F/X with comments regarding
(1) ease of use, (2) success of use, and (3) general quality of
the ***************** Stand-In.
(ii) Within 30 days of its receipt of a Beta Version of the Jetson
Software, Kodak will provide Life F/X with any comments
regarding (1) ease of use, (2) success of use, (3) general
quality of the Stand-In, and (4) whether the Beta version is
acceptable to Kodak for commercialization purposes. Kodak will
inform Life
3
4
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
F/X promptly, in writing, once it has accepted the Jetson
Software for commercialization purposes. In the event that the
Beta version is not acceptable to Kodak, Kodak will give Life F/X
written notice within such 30 day period specifying the problems
Kodak has identified. Life F/X shall thereupon have 30 additional
days, or such longer period as the parties may mutually agree
upon, to cure such problems. If Life F/X cannot cure such
problems within such period of time, and if in Kodak's opinion
such problems are material to Kodak's ability to commercialize
the Jetson Software then, at either party's option, they may
terminate this Agreement by giving written notice to that effect.
Once Kodak has accepted a Beta Version for commercialization (A)
the three-year plus ninety (90) day period referenced in Section
1 shall commence as of the date of Kodak's letter stating its
acceptance of the Beta version for commercialization purposes;
(B) Kodak will immediately commence the planning and design of
the marketing effort contemplated by Section 3(c)(iv)(D) below,
(C) Kodak shall commence building the Facility, (within 90 days
after ***************, Kodak and Life F/X will mutually agree to
the minimum number of Stand-Ins which the Facility will be
capable of processing a day), and (D) within ninety (90) days of
such acceptance Kodak shall commence "commercialization." The
term "commercialization" means the sale of Stand-Ins to consumers
as contemplated by this Agreement. Life F/X shall have the right
of reasonable approval of Kodak's marketing plans and efforts.
(iii) Within 90 days from Kodak's acceptance of the Jetson Software for
commercialization purposes, or in ************, whichever is
later, Kodak shall commercialize products and services that use
the Jetson Software. Such commercialization shall include
commencing the marketing and promotional activities described
below and commencing the processing of Stand-Ins for consumers.
(iv) During the first year of commercialization by Kodak of the Jetson
Software, Kodak will:
A. operate a ********************, and on other appropriate
************* managed by Kodak, (as reasonable determined by
Kodak), that will allow for the purchase of Stand-Ins,
created with the use of Jetson Software, by consumers.
B. Allocate and spend at least *******************************
for Stand-Ins through Kodak ********************
**********.
C. Assign the following Kodak employees or their replacements
to assist in the integration and marketing of the Jetson
Software with related Kodak products: For Integration
Issues: *********; For Marketing Issues: ****************.
D. Expend at least ***********************************
**************** to promote and advertise the products and
services that use the Jetson Software. These Marketing
efforts shall commence upon Kodak's launch of products which
use the Jetson Software unless otherwise mutually agreed.
Such "in-kind" marketing efforts shall include, where
reasonably
4
5
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
applicable, marketing the Stand-ins and services, on all
current and future Kodak ********************************
************************ marketing on the Kodak *********
marketing in Kodak's current and future retail outlets and
partnership arrangements (to the extent agreed to by
retailers and partners), and marketing to ****************
**********************************************************
**********************************************************
and other Kodak products. Subject to Section 5 hereof, the
level of marketing efforts referenced in this subparagraph D
shall also apply to the second and third years of the Term
of this Agreement.
d. Once Kodak has accepted the Jetson Software for commercialization, and
has enabled the Facility, Kodak shall process any Stand-Ins generated
by Life F/X for *********** Markets or Accounts which are not
considered obscene, pornographic or otherwise similarly objectionable.
In addition, Kodak shall have the right at all times to review the
digital images submitted, to disclose the images as necessary to
satisfy any laws, regulations or government requests, and to refuse to
process, in Kodak's reasonable discretion, any images deemed
objectionable for the reasons described above or in violation of this
Agreement. Life F/X shall receive ******************************. As
such, the prices charged to Life F/X for the processing of a Stand In
shall be **********************************************************
*******************************************************************
*****************
e. During the Term of this Agreement, Kodak shall give all purchasers of
Stand-Ins notice that such Stand-Ins can be ***********. Such notice
shall be of a form and substance mutually agreed to by the Parties.
f. Kodak shall include a "Powered by Life F/X" ingredient brand in
proximity to or conjunction with all Stand-Ins it sells.
g. Where appropriate, Kodak will work in good faith with Life F/X, to
prepare any presentations to be made by Life F/X concerning the
Software and resulting products to Kodak's partners and OEM
relationships (and Kodak will assist Life F/X with introductions to
such parties) as well as presentations to other third parties
reasonable identified by Life F/X.
h. Kodak acknowledges and agrees that licenses granted in this Agreement
may not be sublicensed or assigned except to the extent of the
end-user licenses contemplated by Sections 4.a and 4.b., below.
4. LIFE F/X OBLIGATIONS
a. WITH RESPECT TO GENESIS SOFTWARE: Life F/x grants Kodak a royalty free
license to use, market, distribute and support (but not modify) the
Genesis Software on the Kodak *************************************
************** in the form provided to Kodak by
5
6
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
Life F/X, which shall include the end user license provided to Kodak
by Life F/X. Additionally, in ***********, Life F/X shall provided
Kodak with a minimum of 5 "demo" versions of the Genesis Software to
allow Kodak to: introduce the Genesis Software to certain Kodak
customers, gain feedback regarding the viability of the Genesis
Software, and to discuss market testing and launch plans with the
**************************************** This license shall
terminate upon the earlier of the termination of this Agreement or
upon delivery of the Babble Software to Kodak, except that Kodak will
have a right to continue to market, distribute, and support any
products containing the Genesis Software and in existence on the date
on which the Babble Software is delivered to Kodak, until the earlier
of (i) when any and all such product is sold or distributed or (ii)
180 days after such termination.
b. WITH RESPECT TO THE BABBLE SOFTWARE: Life F/X grants to Kodak a
royalty free license to market, distribute and support (but not
modify) the Babble Software, which shall be distributed to end users
on the Kodak ************************************************, in
the form provided by Life F/X to Kodak, which shall include the end
user license provided to Kodak by Life F/X. Additionally, in
****************** Life F/X shall provide Kodak with a minimum of 5
"demo" versions to allow Kodak to introduce the Babble Software to
certain Kodak customers, gain feedback regarding the viability of the
Babble Software, and to discuss market testing and launch plans within
the ******************************** markets. This license shall
terminate upon the termination of the Agreement, except that Kodak
will have a right to continue to market, distribute, and support any
products containing the Babble Software and in existence on the date
on which this Agreement terminates, until the earlier of (i) when any
and all such product is sold or distributed or (ii) 180 days after
such termination.
c. WITH RESPECT TO JETSON SOFTWARE:
(i) Life F/X will provide Kodak with and Alpha Version of the
Jetson Software as soon as such version is available. Such Alpha
Version will allow for the creation of Stand-Ins that, when used
with the Babble Software or another Life F/X player, are ********
enabled. Subject to meeting the conditions set forth in Section
2.c of this Agreement, such Stand-Ins shall also be ********
**************** enabled when used with the Babble Software or
another Life F/X player. Life F/X will work in good faith with
Kodak to evaluate and improve the Alpha Version until such time
as Life F/X believes such version is a complete Beta Version. In
order to allow Kodak to prepare to launch products generated by
the use of the Jetson Software, Life F/X shall provide Kodak with
an updated status report in ******** regarding the Jetson
Software and confirming the date by which the Jetson Software
will be made available to Kodak in Beta Version.
(ii) In or before ********, Life F/X shall deliver the Beta
Version of the Jetson Software to Kodak, which will have the
functionality described above in Exhibit A. In the event that the
Beta version is not acceptable to Kodak, Life F/X will have 30
days from the date of written notice of non-acceptance by Kodak,
or such longer
6
7
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
period as the Parties may mutually agree upon, to cure any
problems identified by Kodak. If Life F/X fails to cure such
problems within the specified time, and if in Kodak's opinion
such problems are material to Kodak's ability to commercialize
the Jetson Software then, at either party's option, they may
terminate this Agreement by giving written notice to that effect.
(iii) In or before **********, Life F/X shall deliver to Kodak
a version of the Jetson Software acceptable to Kodak for
commercialization by Kodak. This version of the Jetson Software
shall be able to perform as detailed herein, and in Exhibit A,
and shall produce photo-realistic Stand-Ins that are virtually
indistinguishable from video quality, and which when used with
the Babble Software or another Life F/X player will allow the
consumer to easily transmit the Stand-In via an ********, or,
subject again to Section 2.c hereof, will allow the consumer to
use the Stand-In to participate in ******************************
****, and drive it from either their keyboard (text to speech) or
voice input from a microphone on their computer. The user must be
able to open the Stand-In and view it in an amount of time
comparable to the time it takes to open a text email.
(iv) Life F/X grants to Kodak a royalty bearing license to use
the Jetson Software for the purpose of creating and marketing
Stand-Ins. the royalty payments due under this license are
described below in Section 6 of the Agreement. Such license shall
terminate upon the termination of this Agreement, except that
Kodak will have a right to continue to use the Jetson Software
for a period of not more than one year to process any orders in
hand or contemplated under any other existing contractual
obligation pursuant to consumer offers as of the date of
termination.
d. Life F/X will provide Kodak, at no cost to Kodak, to its best
commercially reasonable ability, with technical training, information
and support during normal business hours regarding the Genesis,
Babble and Jetson Softwares to enable Kodak to perform to the
satisfaction of its customers. In addition, Life F/X will provide
Kodak, at no cost to Kodak, with reasonable technical assistance
required to integrate the Jetson Software into a Kodak product or
service as contemplated under this Agreement. Notwithstanding the
foregoing, Kodak shall have no rights to the source code to any of the
software nor shall it have any rights to the intellectual property
(including all patent rights and trademark rights) of Life F/X except
to the extent of the explicit license rights granted herein.
e. Life F/X will provide Kodak, at no additional cost, with any and all
plug-ins which are necessary to enable the ************************
created by the Genesis Software, Babble Software and/or Jetson
Software to be transmitted, opened, assessed and used by a consumer
********, and subject to Section 2.c hereof, in an ****************
******** environment.
f. Life F/X will work in good faith with Kodak to address any Software
production issues.
7
8
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
g. Life F/X will work in good faith with Kodak, to the extent requested
by Kodak, to prepare for any presentations to be made by Kodak to
Kodak partners which involve the use of the Jetson Software.
5. EXCLUSIVITY.
a. Kodak shall have an exclusive right to use the Jetson Software to
create Stand-Ins in the ****************************************
**********************************************************************
Market) and to sell the Stand-Ins generated thereby for one year plus
ninety (90) days from the date the Jetson Software is accepted by
Kodak. Such rights shall continue during both the second and third
year of the term of this Agreement unless at least ninety days prior
to the end of any year of the Term, Kodak sends Life F/X notice that
it will not commit to renew its marketing commitment (as set forth in
Section 3(c)). If Kodak chooses no to renew its marketing support and
exclusive rights to the Jetson Software: (1) Life F/X may pursue
licensing opportunities with other companies and (2) 90 days after
such failure to renew such exclusive rights, Life F/X may terminate
this Agreement and Kodak's license rights hereunder, in accordance
with the provisions of this Agreement.
b. During the term of this Agreement, Kodak's ************************
shall not market or use any software other than the Jetson Software
capable of transforming a digital image of a person's face (as
provided by a ******************************** into a ************
******** image that can move, talk and express emotion. For a
period of 3 months after termination of this Agreement, Kodak's
******************** shall not market or use any software capable of
transforming a digital image of a person's face (as provided by a
**********************************************************************
image that can move, talk and express emotion.
6. FEES. Commencing upon the commercialization of the Jetson Software, and
throughout the entire term of this Agreement, Kodak shall pay to Life F/X a
royalty fee equal to the greater of ************************ generated
for each Xxxx-In sold by Kodak. The parties also agree that on or before
the date of acceptance by Kodak of the Jetson Software the parties will
negotiate in good faith a minimum royalty amount to be paid by Kodak during
each year of the term of this Agreement commencing upon the
commercialization of the Jetson Software by Kodak.
Kodak and Life F/X shall mutually agree on a royalty payment for any
Related Software Accessories at such time as they may be developed.
7. INTELLECTUAL PROPERTY. The parties anticipate entering into various
research and development arrangements (pursuant to separate agreements)
that could generate inventions. Pursuant to the terms and conditions of any
such separate agreements, Life F/X will license to Kodak a Software
Development Kit or API which will allow for Kodak to use the Software in
vertical applications developed or otherwise owned by Kodak. The parties
agree to address the appropriate ownership of such inventions in the
context of entering into any such SDK, API, or research and development
agreements.
8
9
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
8. WARRANTY. (a) Each Party represents and warrants to the other that (i) this
Agreement has been executed and delivered by its duly authorized
representative and constitutes a valid and legally binding obligation of
it, enforceable against it in accordance with its terms and (ii) the
execution and performance of this Agreement does not require any consent,
approval or notice under, and will not conflict with or result in a breach
of ruling of any governmental authority or any other material restriction
of any kind or character to which it is subject.
EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER PARTY MAKES ANY
WARRANTY OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING WITHOUT
LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE.
(b) BY LIFE F/X (i) Life F/X represents and warrants that it has the
unimpaired right to license Kodak to distribute, promote, and use the
Genesis Software and Babble Software and to use the Jetson Software as
contemplated under this Agreement.
(ii) Life F/X warrants that, to the best of its knowledge, neither the
Genesis Software, Babble Software, Jetson Software, or any Related
Software Accessories created by Life F/X (collectively referenced as
the "Life F/X Products") developed and supplied to Kodak under this
Agreement, will infringe any intellectual property rights of another.
If either party discovers the existence of any such infringement, Life
F/X shall attempt to procure a license from the person or entity
claiming or likely to claim infringement, or to modify the Life F/X
Product to avoid the infringement. Any costs of obtaining any such
license or making any such modification shall be borne by Life F/X.
9. USE OF TRADEMARKS.
a. BY LIFE F/X. Subject to the terms of this Agreement, Life F/X grants
to Kodak a non-exclusive right and license to use the Life F/X
trademark or ingredient xxxx as depicted on Exhibit B hereto in
connection solely with its rights and obligations hereunder. Such
marks shall be of a size and location reasonably agreed upon by Life
F/X and Kodak. Kodak may not transfer or assign this license or any
other right to use the Life F/X trademarks, ingredient marks or
Software to any other party.
b. BY KODAK. Life F/X may not use or display any Kodak tradenames,
trademarks or service marks ("Marks"), nor permit them to be displayed
or used by third parties, without the prior written approval of Kodak.
Kodak to provide Life F/X with language regarding permitted use of
trademarks within 30 days of the execution of this Agreement.
c. Nothing in this Agreement creates in either Party any rights in the
Marks of the other, and to the extent any right to use a Xxxx is
granted under this Agreement, upon termination of the Agreement each
party must discontinue use of the others Marks in any future products.
9
10
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
10. RIGHT OF FIRST REFUSAL.
During any period when Kodak is maintaining its exclusive rights hereunder
pursuant to Section 5, Kodak shall have a right of first refusal to sell,
market distribute, integrate, or otherwise use any future Life F/X products
aimed at ****************************************************************
*********************************************. In the event that Life F/X
develops any product aimed at such a market, or elects to promote,
advertise or solicit, a product aimed at such market (an "Opportunity"),
Life F/X shall inform Kodak in writing of such Opportunity (the
"Opportunity Notice"). The Opportunity Notice shall describe the product
with sufficient particularity (including any pricing or other similar
requirements) to permit Kodak to reasonably evaluate the product. Life F/X
shall deliver the Opportunity Notice to the person(s) designated by Kodak
in writing for this purpose, or in the absence of any such designation to
the Marketing contact identified above. Kodak shall have thirty (30) days
from receipt of the Opportunity Notice to inform Life F/X as to whether or
not it is interested in selling, marketing or otherwise using the
Opportunity. If Kodak declines the Opportunity, the Life F/X may pursue the
Opportunity with any other party. If Kodak accepts the Opportunity, the
Life F/X and Kodak shall negotiate in good faith for sixty (60) days to
determine the business terms of the arrangement for the Opportunity. If
during such period the parties are unable to mutually agree on terms then
Kodak's right of first refusal as to that Opportunity shall lapse and be of
no further force and effect.
11. TERMINATION.
(a) This Agreement may be terminated by either party, or at its option, the
party may suspend its performance of its obligations under the
Agreement, if the other party has committed a material breach of the
Agreement, and the material breach has not been cured within 30 days
after written notice of the breach has been received by the breaching
party.
(b) This Agreement may be terminated by either party if Life F/X fails to
provide Kodak, by **************** with a version of the Jetson
Software which is suitable for commercialization by Kodak.
(c) This Agreement may be terminated by Life F/X if Kodak fails to maintain
its exclusivity rights pursuant to Section 5, except that the licenses
granted to Kodak pursuant to Section 4, shall continue as provided
therein to the extent necessary to run down inventory or process orders
in hand, or as otherwise provided in Section 5.a.
12. EFFECT OF TERMINATION OR EXPIRATION. Upon termination or expiration of this
Agreement:
(a) Kodak may continue to promote, market, sell or otherwise distribute any
Kodak ******** or other products existing at the time of termination
which contain either the Genesis or Babble Software to the extent
contemplated by Section 4 of this Agreement.
10
11
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
(b) Kodak may continue to promote, market, sell or otherwise distribute
any Kodak products or services containing or using the Life F/X
Products and existing at the time of termination to the extent
contemplated by Section 4 of this Agreement.
(c) Kodak must immediately stop manufacturing any additional products
which contain or otherwise use the Life F/X products except Kodak
shall continue to process Stand-Ins for orders in hand.
(d) Upon any termination or expiration of this Agreement, Kodak may offer
to Life F/X the right to purchase from Kodak the Facility at a price
equal to the Facility's then depreciated book value. For this purpose
the Facility shall mean only the hardware, software and related
personal property and equipment and not the real estate in which such
Facility is located. In the event that Kodak offers and Life F/X
exercises this purchase right, Life F/X shall move the Facility to its
own location. In the event that Life F/X is not offered the
opportunity to purchase the Facility as described above, then in such
event, upon the termination of this Agreement Kodak shall continue to
operate the Facility to the extent requested by Life F/X for a period
of up to 90 days.
(e) Termination of this Agreement shall have no impact on any SDK or API
Agreement entered into by the Parties, which shall be governed by
terms thereof.
13. PRESS RELEASES OR OTHER ANNOUNCEMENTS Any press releases regarding this
Agreement issued by either party must first receive the prior written
approval of the other party, such approval not to be unreasonably withheld,
conditioned or delayed. Neither party shall make any announcement or other
statement regarding this Agreement, or any relationship arising herefrom,
for a period of forty five (45) days from the date of execution.
Notwithstanding the foregoing, Life F/X may (a) make private disclosures
regarding this Agreement to prospective investors that have executed an
appropriate nondisclosure agreement, (b) in the event that Life F/X counsel
deems it necessary to make a public announcement regarding this Agreement
then Life F/X may do so after prior notice to Kodak and (c) after receiving
the prior written approval of Kodak, issue a press release (similarly,
after receiving the prior written approval of Life F/X, Kodak may issue a
press release).
14. INDEMNIFICATION.
(a) General Indemnification. Each Party agrees to defend, indemnify and
hold the other Party harmless against all claims, demands, losses, and
causes of action for personal injury or property damage arising from
or based on the intentional acts, negligence, or willful misconduct of
indemnitor's employees, agents, or contractors who undertake
activities in connection with this Agreement, to the extent such
personal injury or property damage is caused by such acts, negligence
or willful misconduct. Indemnitor will pay any costs and damages,
including reasonable attorneys fees, that a court finally awards
against the indemnitee as a result of such claim or that are paid in
settlement thereof, provided the indemnitee gives indemnitor prompt
written notice of such claim and tenders to indemnitor the defense and
all related settlement negotiations Notwithstanding the above, the
indemnitee shall have the right, but not the obligation, at its sole
discretion, to participate in any such defense at its own expense.
11
12
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
(b) Life F/X will indemnify, defend and hold Kodak harmless against any
claim that the Genesis Software, Babble Software, Jetson Software or
any Related Software Accessory provided by Life F/X to Kodak,
excluding any modifications made by Life F/X at Kodak's request,
infringes any intellectual property rights of any third party, or
causes damage to any property, personal injury or death. Life F/X will
pay any costs and damages, including reasonable attorneys fees, that a
court finally awards against Kodak as a result of such claim or that
are paid in settlement thereof, provided Kodak gives Life F/X prompt
written notice of such claim and tenders to Life F/X the defense and
all related settlement negotiations. Notwithstanding the above, Kodak
shall have the right, but not the obligation, at its sole discretion,
to participate in any such defense at its own expense.
15. LIMITATION OF LIABILITY. In no event will either Party will be liable to
the other Party for lost profits, or consequential, incidental, or punitive
damages even if advised in advance of the possibility of such damages.
16. NOTICE. All notices required or desired to be given must be given must be
in writing and if not personally delivered, by sent by facsimile (with a
copy by regular U.S. mail) or by registered or certified mail or by
overnight delivery service. If sent by facsimile or personally delivered or
by overnight delivery service, notices will be deemed to have been given on
the day when delivered to the other party at the address shown on the first
page of this Agreement. If mailed by registered or certified mail, notices
will be deemed to have been given when received or when delivery is
refused. Either party may from time to time change the address to which
notices to it are to be sent by giving notice of such change to the other
party in writing.
17. ONGOING EFFORTS. Kodak and Life F/X will work in good faith to continue to
explore promotions, marketing opportunities and digital imaging
opportunities which use the unique strengths of each party. Kodak
acknowledges and agrees that it shall never attempt to decompile,
disassemble or reverse engineer any of the Software.
18. WAIVE. Failure by either party to enforce any term or condition of this
Agreement will not be deemed a waiver of future enforcement of that or any
other term or condition.
19. ASSIGNMENT. Neither party may assign its rights or obligations under this
Agreement without the prior written consent of the other, which consent
shall not be unreasonable withheld.
20. INDEPENDENT CONTRACTOR. Kodak and Life F/X are independent contractors, and
neither party may act as agent or otherwise bind the other party to any
obligations.
21. EXPORT CONTROL. Each party agrees to comply with all applicable
governmental laws and regulations relating to export of technical data and
products covered by this Agreement.
22. FORCE MAJEURE. Except for payments of outstanding balances when due,
neither party will be liable for any damages or penalties for delay in
performance when such delay is due tot he elements, acts of God, acts of
civil or military authority, fire or floods, epidemics, quarantine
12
13
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
restrictions, war or riots or other circumstances outside the reasonable
control of the affected party.
23. GOVERNING LAW. This Agreement will be governed by and construed according
to the substantive laws of the State of New York without regard to its
conflict of laws principles. The parties submit to the nonexclusive
personal jurisdiction of, and waive any objection against, the United
States District Court for the Western District of New York and the United
States District Court for Massachusetts.
24. CONFIDENTIAL INFORMATION. During the term of this Agreement, certain
information that is considered proprietary or confidential may be disclosed
by or exchanged between the parties. The term "Confidential Information"
means all information disclosed by one Party to the other in accordance
with the following procedure: When disclosed in writing. Confidential
Information must be labeled as being confidential and when disclosed
orally, Confidential Information must be identified as Confidential at the
time of disclosure, with subsequent confirmation to the other party in
writing within 30 days after disclosure, identifying the date and type of
information disclosed. During the Term and for a period of five years
thereafter, each party will hold in confidence the other party's
Confidential Information and must not, without the prior written consent of
the other party, use such other party's Confidential Information other than
to further the purposes of this Agreement or disclose the Confidential
Information oh the other party to any person except its own employees or
employees of its affiliates having a need to know and who shall likewise
agree to be bound by the foregoing. Confidential Information shall not
include any information that (i) is generally available to the public
before its disclosure under this Agreement, (ii) becomes generally
available to the public without default by either party under this
Agreement, (iii) is lawfully in the possession of one party in written or
other recorded from before the time of disclosure by the other party, (iv)
is lawfully acquired by one party from a source that is not under
obligation to the other party regarding disclosure of such information, (v)
is disclosed by one party with permission of the other party to any third
party on a non-confidential basis or (vi) is disclosed under operation of
law (provided, the parties shall endeavor to give prior notice of such an
event in order to allow a party to seek a protective order or the like.
The parties agree that the terms of this Agreement are "Confidential
Information" as defined above subject, however, to the proviso that Life
F/X shall be permitted to disclose such terms as its counsel deems
necessary to comply with applicable securities laws in connection with its
filings with the Securities and Exchange Commission. Life F/X shall provide
Kodak with notice of its intent to disclose such information as much in
advance of such disclosure as is commercially reasonably possible.
25. SEVERABILITY. If any term of this Agreement is held invalid or
unenforceable for any reason, the remainder of the provisions will
continue in effect as if this Agreement had been executed with the invalid
portion eliminated.
26. ENTIRE AGREEMENT. This Agreement, including and Supplements and Attachments
is the entire agreement of the parties and supersedes all prior agreements
and understandings, whether
13
14
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
written or oral, with respect to the subject matter of this Agreement. This
Agreement can be modified only by a written amendment executed by
authorized representatives of Life F/X and Kodak.
27. COUNTER PARTS. Facsimile signatures constitute original signatures for
purposes of the execution of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day year stated above.
XXXXXXX KODAK COMPANY LIFE F/X, Inc.
By: /s/ Xxxx X. XxXxxxx By: /s/ Salhany & Xxxxxxxxxx
-------------------------------- -----------------------------
Name: Xxxx X. XxXxxxx Name: Salhany & Xxxxxxxxxx
------------------------------ ---------------------------
Title: Chief Marketing Officer Title: Co-Presidents
----------------------------- --------------------------
Consumer Imaging
14
15
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
EXHIBIT A
1. INTRODUCTION
The Jetson Software will be able to process digital images of a human face
that meet the criteria defined below. The Jetson Software will transform the
digital image to a ******** Stand-In using some human intervention,
****************. This Exhibit A details the processing steps and performance of
the Jetson Software and specifies items that Life F/X and Kodak will deliver
under this Agreement.
2. PROCESSING STEPS
The Jetson Software has five major processing steps:
a) The face is pre-screened by a human operator and either rejected
because it does not meet minimum requirements or accepted for further
processing.
b) Location of the face and face features, and typing the face based on
age, sex, and skin color.
c) Fine feature detection, analysis and mapping of ****************
******** models.
d) Generation of ******** face image Stand-In from the mapped data.
e) Final quality control verification.
3. LIFE F/X DELIVERABLES
a) Life F/X will deliver software for each of these five processing
steps.
b) Life F/X will deliver software that links each processing step as well
as accepting JPEG images and/or images of other formats if specified
by Kodak, and saving a completed ******** Stand-In to disk.
c) Life F/X will deliver documentation of the major exported functions in
the Jetson Software and an overview of the process flow.
d) Life F/X will deliver an overview design document that shows how Kodak
will build a working, production system using the Jetson Software.
This document will be based on a prototype system developed by Life
F/X and used for testing and evaluating the Jetson Software.
e) LifeFX will work with Kodak to define access methods to integrate
the Life F/X process with the Kodak photo-finishing and image
processing process.
Exhibit A - Confidential to Life FX and Kodak 1
16
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
f) Life F/X will deliver executable (compiled, linked) code for the
Jetson Software's computer vision and graphics algorithms. When
essential for proper integration of the Jetson Software with the Kodak
process, LifeFX may provide Application Programming Interfaces for
some selected modules.
4. KODAK DELIVERABLES
a) As Kodak has developed expertise and know-how in digital imaging and
that its expertise can potentially accelerate the development of the
Jetson Software, it is expected that Kodak will provide technical
assistance to Life F/X where possible, including consultation with
digital imaging and system development experts at Kodak.
b) Kodak will work with LifeFX to integrate appropriate hooks with the
Kodak Digital Imaging, Retouching and Finishing process, and define a
common set of input and output methods for the integration of the
Jetson Software within the Kodak network of photo-finishing processes.
c) Kodak will purchase, equip and maintain all items and personnel for
the production systems (the "Facility").
d) Kodak will provide Life F/X with a large sample of input face images
and Jetson results to be used by Life F/X to improve or adjust the
Jetson Software. These images and data will be kept confidential and
used only for research.
e) Kodak will provide Life F/X with enough information about the
Facility, its operation and its network infrastructure to allow
LifeFX to best design, modularize and optimize the Jetson Software.
5. GENERAL IMAGE REQUIREMENTS
These items are necessary for the Jetson Software to create a ********
Stand-In.
a) The input image must be a high-quality, color digital image. The input
formats will include at a minimum JPEG. Kodak will cooperate with
LifeFX on the selection and integration of other digital image
formats. In particular Kodak will provide LifeFX with the appropriate
software if image formats proprietary to Kodak must be integrated in
the Jetson Software.
b) The Jetson Software will convert only one face to a ****************
Stand-In per digital image. There should also be only one human face
in an image, but the Jetson Software will also handle images including
smaller faces (such as photographs on a wall) in the image background.
If there is more than one face in the image, than Jetson needs to be
informed of which face is to be converted.
c) The entire face, head, and neck must be in the image.
d) The face must be looking straight into the camera with no more than **
******** of roll, pitch or yaw of the face, with respect to the focal
plane and principle axis of the camera.
Exhibit A - Confidential to Life FX and Kodak 2
17
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR
PORTIONS OF THIS DOCUMENT. DELETED PORTIONS ARE
MARKED WITH ASTERISKS.
e) For best results the camera must be essentially level with the eyes
and the image focal plane must be essentially parallel to the face
plane.
f) For best results the face must have an expression close to a neutral
expression and the eyes must be open and looking almost directly at
the camera.
g) For best results the face must be evenly illuminated, so Jetson can
find the face features, and have no reflections from the eyeglasses
that affect the view of the eyes.
h) For best results there must be at least **************** steps of
contrast within the face.
i) For best results the face must be in sharp focus.
j) The size of the face image, from chin to natural hairline, must be ***
**************** as otherwise the model or the animation may not meet
required quality standards.
k) The face features must be visible. As examples, hats, dark glasses,
hair, cellular telephones, hands, large beards or cigarettes must not
obscure the face. There should be nothing under the chin that would
restrict apparent motions of the jaw.
l) In the first version(s) of the Jetson Software it may be required that
the eyeglasses be removed, as they can confuse the Software.
6. SYSTEM CONFIGURATION
The details of the production system (the "Facility") remain to be fully
delineated in collaboration between Kodak and Life F/X. Each computer would be
at a minimum a Pentium IV, 1.5 GHz class machine with at least 256 MB memory and
adequate disk storage. However LifeFX will use the fastest Pentium class
machine, or successor to the Pentium, available at the time of delivery of the
Jetson Software, with the architecture specified including graphics card,
memory, data storage specified by LifeFX and with possibly a graphics
co-processor and/or multi-processors. The Jetson will be developed in a modular
manner and consisting of sub-processes (or steps) that can be configured to run
on individual computers configured as workstations and servers and
interconnected to optimally maximize the production and best integrate with
Kodak's infrastructure.
Exhibit A - Confidential to Life FX and Kodak 3
