Exhibit 10.1
DEVELOPMENT LICENSE
AND JOINT MARKETING AGREEMENT
This Agreement ("Agreement") is made, entered into and effective as of July 18,
2003, ("Effective Date") by and between xSides Corporation, a California
corporation with its principal place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("xSides"), and Y3K Secure Enterprise Software,
Inc., a Nevada corporation with its principal place of business at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereafter referred to as "Independent Software
Vendor" or "ISV"").
Recitals
A. The purpose of this Agreement is for xSides to provide ISV with the xSides
PDK (as defined below) for the sole purpose of permitting ISV to develop and
integrate applications that interoperate with the xSides technology. In
addition, this Agreement shall also set forth the terms and conditions whereby
the parties hereto ("Parties") may jointly market their respective products and
services.
B. ISV desires to license the xSides PDK in order to develop Customized xSides
Client Products (as defined below) as the user interface front-end for content
and server-side products owned or otherwise licensed by ISV for distribution to
Enterprise Customers (as defined below).
C. xSides desires that ISV license the xSides PDK for the sole purpose of
developing such Customized xSides(R) Client Products.
NOW THEREFORE, for the mutual covenants contained herein, and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties agree as follows.
Agreement
1. DEFINITIONS
1.1 "Customized xSides Client Product" means an xSides Client Product (defined
below) that has been customized to include ISV Content and/or interoperate with
ISV Server Products pursuant to the terms of this Agreement.
1.2 "Derivative Work" means any "derivative work" as that term is defined in
Section 101 of Title 17 of the United States Code (the U.S. Copyright Act of
1976), as amended.
1.3 "End User" means a person who uses an xSides Client Product.
1.4 "Enterprise Customer" means any legal entity organized by charter, agreement
or other similar instrument, including corporations, partnerships, limited
liability companies or other similar organizations of more than one person, that
is using or is interested in using Customized xSides Client Products for
enterprise applications, including, but not limited to, corporate instant
messaging and corporate portals.
1.5 "End User License Agreement" means the xSides agreement placed within or
accompanying or otherwise governing the use of an xSides Client Product.
1.6 "Intellectual Property Rights" means any and all rights existing now or in
the future in the United States or anywhere in the universe, including, without
limitation, any and all rights: (i) under the laws of copyright, patent,
trademark, trade secret, trade dress, unfair competition, "droit moral" or moral
rights, or other similar laws; (ii) relating to the development and use of
databases, domain names, mask works, or know-how; (iii) prohibiting the
alteration or circumvention of copyright management information or technological
measures; or (iv) subsisting in any and all patent applications, trademark
registrations, reissues, renewals, extensions, restorations, continuations,
divisionals, or foreign counterparts of any of the foregoing.
15
1.7 "ISV Content" means names, logos, hyperlinks, text, still or animated
images, features, applications, moving images, sound, streams of sound, video,
data (including but not limited to "tickers") owned or otherwise licensed by
ISV.
1.8 "ISV Server Product" means server-side products and related technologies
owned or otherwise licensed by ISV, namely (a) ICS Instant Communications
System, (b) Market Portal, (c) Commerce Manager, and (d) Affiliate Tracker
(▇▇▇▇▇▇▇▇▇▇▇▇, "▇▇▇ Solutions").
1.9 "Object Code" shall mean the machine readable form computer programming code
as opposed to the human readable form of computer programming code.
1.10 "xSides PDK" means the xSides Platform Developers Kit and any application
programming interfaces (APIs), sample codes and documentation contained therein,
which shall be provided to ISV.
1.11 "Source Code" shall mean the human readable form computer programming code
and related system level documentation, including all comments and any
procedural code such as job control language.
1.12 "Territory" means worldwide.
1.13 "xSides Client Product" means any client-side product incorporating xSides
Technology or any portion thereof, but not including ISV Owned Assets (defined
below).
1.14 "xSides Server Product" means any server-side products and related
technologies owned or otherwise licensed by xSides, including, but not limited
to, server software designed to control or monitor the alternative screen area
created by the xSides Technology.
1.15 "xSides Technology" means the xSides' patents, know-how and copyrighted
works relating to the creation and operation of an alternative screen area which
cannot be controlled by the underlying operating system.
2. INTELLECTUAL PROPERTY OWNERSHIP
2.1 xSides(R) Owned Assets. xSides does and shall own all right, title, interest
and Intellectual Property Rights in and to the xSides Technology, xSides Client
Products, xSides Server Products and xSides PDK (collectively, the "xSides Owned
Assets"). The parties understand and agree that neither ISV nor any of its
partners, customers or users is granted any rights whatsoever to make derivative
works of the xSides Owned Assets; provided, however, that ISV shall be entitled
to use the xSides PDK to develop graphical user interfaces in connection with
the development of Customized xSides Client Products pursuant to the
then-current rules and conditions for the use of xSides PDK.
2.2 ISV Owned Assets. ISV does and shall own all right, title, interest and
Intellectual Property Rights in and to ISV Server Products and ISV Content
including any graphical user interfaces developed exclusively by ISV for
customized xSides Client Products(collectively, the "ISV-Owned Assets").
2.3 IP Allocation. In the event that it is unclear as to whether an asset is
either an xSides Owned Asset or an ISV Owned Asset, the Parties shall promptly
discuss in good faith any allocation of intellectual property rights relating
thereto. The Parties agree that all such allocation shall be consistent with the
Parties' objectives that xSides shall retain ownership and control of all
features, functionality and characteristics of the xSides Technology and that
ISV shall retain ownership and control of the features, functionality and
characteristics of the ISV Content and ISV Server Products.
3. LICENSES
3.1 License from xSides to ISV.
(a) Beginning on the Effective Date and for the Term of this
Agreement and so long as all of the terms and conditions of this Agreement are
followed and met, xSides hereby grants to ISV a limited non-exclusive,
non-transferable, personal, non-assignable, royalty-free license in the
Territory to use the xSides PDK in order to create Customized xSides Client
Products for evaluation by Enterprise Customers; provided, however, that ISV
agrees to follow such rules and conditions for use of the xSides Technology as
set forth in the xSides PDK, which are hereby incorporated by reference. xSides
hereby reserves the right to modify from time to time such rules and conditions,
and ISV agrees to abide at all times by the then-current rules and conditions
for use of the xSides PDK. xSides shall notify ISV of such modifications in
writing or by updating the DevZone web site.
16
(b) Beginning on the Effective Date and for the Term of this
Agreement and so long as all of the terms and conditions of this Agreement are
followed and met, xSides hereby grants to ISV a limited non-exclusive,
non-transferable, personal, non-assignable, royalty-free license in the
Territory to use, display, reproduce, transmit and install Customized xSides
Client Products in Object Code form solely for the purpose of allowing
Enterprise Customers to evaluate either Party's respective products and
services, with the right to sublicense such rights to Enterprise Customers for a
maximum term of thirty (30) days per Enterprise Customer.
(c) Beginning on the Effective Date and for the Term of this
Agreement and so long as all of the terms and conditions of this Agreement are
followed and met, xSides hereby grants to ISV a limited non-exclusive,
non-transferable, personal, non-assignable, royalty-free license in the
Territory to sell or distribute any xSides Owned Assets in Source Code or Object
Code form, as applicable, except for the limited right to grant evaluation
sublicenses as provided in Section 3.1(b).
(d) Beginning on the Effective Date and for the Term of this
Agreement and so long as all of the terms and conditions of this Agreement are
followed and met, xSides hereby grants to ISV a limited non-exclusive,
non-transferable, personal, non-assignable, royalty-free license in the
Territory to use xSides' trademarks, only in the form and manner set forth in
the PDK and as may be modified from time to time by xSides. Any changes to the
placement or form of xSides' trademarks shall be reviewed in advance by xSides
and approved or rejected solely at xSides' discretion. The service ▇▇▇▇
"xSides(R)", the xSides(R) logo, "xSides(R)", the cube logo, "▇▇▇▇▇▇.▇▇▇(TM)",
the ▇▇▇▇ "xSides(TM)" and other trademarks, copyright notices or other
proprietary notices or rights belonging to or licensed to xSides are and shall
remain the sole property of xSides.
3.3 Marketing
(a) Branding. The parties agree that Content Partners xSides
Products will be co-branded with the ISV marks specified by ISV and the xSides
marks specified by xSides. The Product may also be branded in accordance with
any other branding strategies that the parties may mutually agree upon in
writing from time-to-time.
(b) Publicity. From time-to-time during the term of this Agreement,
xSides and ISV will collaborate on press releases and other marketing activities
to publicize Customized xSides Client Product and the Parties' relationship
under this Agreement. However, neither Party will make any public announcement
or press release regarding this Agreement, Customized xSides Client Product or
any activities performed under this Agreement without the prior written consent
of the other Party, which consent shall not be unreasonably withheld.
3.4 Reservations and Limitations.
(a) Except as otherwise provided herein or agreed by the Parties,
ISV shall not decompile, reverse engineer, or otherwise disassemble any xSides
Technology, xSides PDK including the xSides Object Code or any portion thereof,
in any manner, and xSides shall not decompile, reverse engineer, or otherwise
disassemble any ISV Server Product, or any portion thereof, in any manner.
(b) Neither Party grants the other Party any right, title or
interest under any Intellectual Property Rights of the other, except as
expressly provided herein. The goodwill from use of each Party's trademarks
hereunder shall inure to the benefit of the Party who owns the trademark. ISV
agrees that it shall not at any time apply for registration of any copyright,
trademark, patent or any other designation which would affect the ownership of
the xSides Owned Assets, nor file any document with any governmental authority
or take any action which would affect the ownership thereof. xSides agrees that
it shall not at any time apply for registration of any copyright, trademark,
patent or any other designation which would affect the ownership of the ISV
Owned Assets, nor file any document with any governmental authority or take any
action which would affect the ownership thereof.
(c) Each Party shall ensure that (i) all installation and download
of the Customized xSides Client Product is subject to an xSides End User License
Agreement, which shall incorporate customary protections for xSides'
Intellectual Property Rights consistent with the terms, conditions and scope of
license provided by this Agreement, and (ii) Customized xSides Client Products
and all related Websites, packaging and advertising materials under its control
shall contain appropriate copyright, trademark and patent notices, in a form
subject to both xSides' and ISV's approval.
17
(d) ISV shall not combine any software that is subject to an open
source code license with xSides Owned Assets in a manner that xSides Owned
Assets, or any portion thereof, thereby becomes subject to the terms of such
open source code license.
4. Revenue Share
(a) In consideration of the rights granted hereunder, ISV shall pay
to xSides a royalty equivalent to 20% of all Qualifying Sales Revenues (defined
below) actually received by ISV.
(b) For purposes of this Section 4, "Qualifying Sales Revenues"
means gross revenues actually received for a given sale less any applicable
discounts, returns, allowances, documented write-offs for bad debt and fraud,
refunds, direct cost of goods sold, sale commissions and taxes payable by the
selling Party (other than income taxes) associated with such transaction.
5. REPORTING, PAYMENT AND ACCOUNTING, AND AUDIT
5.1 Payment and Accounting. Within thirty (30) days after the end of each
calendar quarter during the Term of this Agreement, ISV will deliver to xSides a
detailed written report (sent concurrently in electronic form suitable for
import into a spreadsheet program) setting forth the amount and calculation of
the revenue share payments due to xSides based on revenues actually received
during such calendar quarter, accompanied by payment thereof. The report shall
breakdown the revenue by source in a level and nature of detail to be agreed
upon by the Parties.
5.2 Audit. xSides shall have the right, on thirty (30) days prior notice once
each calendar quarter, to have an independent accounting firm audit the written
reports delivered to the other party and the related books, records and data
maintained by the ISV. Such audit shall be accomplished during the ISV's usual
business hours, and shall be at xSides expense, unless such audit determines an
inaccuracy of more than five percent (5%), in which case the ISV will reimburse
the xSides for the reasonable cost of the audit.
6. CONFIDENTIAL INFORMATION
For the of this Agreement, the parties agree that the terms and conditions of
the Non-Disclosure Agreement ("NDA") entered into between the parties on April
26, 1999 shall govern all issues of confidentiality and disclosure between the
parties, and the terms and conditions of such NDA are incorporated herein by
reference. In addition, this requirement of confidentiality shall survive the
expiration or termination of this Agreement.
7. COSTS OF DEVELOPMENT
Costs of Development. ISV shall be responsible for all software development work
hereunder and any and all costs related thereto.
8. SUPPORT
8.1 ISV shall be solely responsible for providing all levels of technical
support to Enterprise Customers and their End Users for the installation and
evaluation of Customized xSides Client Products under this Agreement.
9. RIGHTS, LIABILITIES AND PROTECTIONS
9.1 Representations and Warranties
Each party represents and warrants to the other that such party (a) is duly
organized, validly existing and in good standing under the laws of the
jurisdiction where it purports to be organized, (b) has the authority to enter
into and fully perform this Agreement, and (c) has duly authorized and approved
this Agreement and the execution thereof by the signatory who has executed this
Agreement on its behalf.
9.2 Disclaimer of Warranties
THIS IS A CONTRACT FOR THE PROVISION OF SERVICES. THE XSIDES PRODUCT, PDK AND
ALL VERSIONS THEREOF, THE XSIDES PROPRIETARY SOFTWARE, THE XSIDES TECHNOLOGY,
THE XSIDES MATERIALS, AND ALL OTHER DELIVERABLES HEREUNDER ARE PROVIDED "AS-IS."
NOTHING CONTAINED IN THIS AGREEMENT MAY BE CONSTRUED AS, AND BOTH PARTIES HEREBY
WAIVE THE BENEFIT OF, ANY REPRESENTATIONS OR WARRANTIES WHETHER EXPRESS OR
IMPLIED, INCLUDING WITHOUT LIMITATION THE IMPLIED WARRANTIES OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, AND NON-INFRINGEMENT.
18
10. INDEMNITY AND LIMITATIONS
10.1 Indemnity
(a) Each party agrees to defend, indemnify and hold harmless the other
party and its affiliates, and their heirs, successors, assigns, licensees,
officers, directors, agents, representatives and employees, and each of them,
from and against any and all claims, demands, liabilities, losses, damages,
costs, expenses (including but not limited to reasonable outside attorneys'
fees), judgments and penalties arising out of, resulting from, based upon or
incurred because of the breach by the indemnifying party of, or other failure
of, any of the indemnifying party's warranties, representations or agreements
made under this agreement.
(b) In the event the xSides Technology is reasonably likely to be found
to infringe any third party's intellectual property rights, xSides shall either
(a) modify the Customized xSides Client Product so that it is not infringing,
but retains substantially the same functionality, or (b) obtain the right for
ISV and its affiliates (without cost to ISV or its affiliates) to continue to
use and distribute the Customized xSides Client Product as provided in this
Agreement.
(c) ISV agrees to defend, indemnify and hold harmless xSides, and its
heirs, successors, assigns, licensees, officers, directors, agents,
representatives and employees, and each of them, from and against any and all
claims, demands, liabilities, losses, damages, costs, expenses (including but
not limited to reasonable outside attorneys' fees), judgments and penalties
arising out of, resulting from, based upon or incurred because of a third party
claim that ISV's or its affiliates' proprietary software or that ISV's or its
affiliates' content as incorporated in the Customized xSides Client Product and
used in accordance with this Agreement violates such third party's intellectual
property rights.
10.2 NO SPECIAL DAMAGES. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN
THIS AGREEMENT, NEITHER PARTY WILL, UNDER ANY CIRCUMSTANCES, BE LIABLE TO THE
OTHER PARTY FOR ANY CONSEQUENTIAL, INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE OR
EXEMPLARY DAMAGES (INCLUDING, WITHOUT LIMITATION, LOST PROFITS, LOSS OF
ANTICIPATED BUSINESS, LOSS OF DATA, OR OTHER BUSINESS LOSSES) EVEN IF SUCH
DAMAGES ARE FORESEEABLE, AND EVEN IF THE BREACHING PARTY HAS BEEN APPRISED OF
THE LIKELIHOOD OF SUCH DAMAGES OCCURRING.
10.3 LIMITATION OF LIABILITY. EXCEPT FOR THE COST OF DEFENDING ANY CLAIMS UNDER
SECTION 10 (INCLUDING WITHOUT LIMITATION REASONABLE OUTSIDE ATTORNEYS' FEES), IN
NO EVENT WILL EITHER PARTY'S LIABILITY RELATING TO THIS AGREEMENT (WHETHER BASED
ON AN ACTION OR CLAIM IN CONTRACT OR TORT), EXCEED THE AGGREGATE AMOUNTS
ACTUALLY RECEIVED OR DUE UNDER THIS AGREEMENT.
11. TERMINATION/ EXPIRATION
11.1 Termination.
This Agreement shall have a term of three (3) years from the Effective Date.
Notwithstanding the foregoing, this Agreement may be terminated (i) if either
Party defaults in the performance of any material obligation and if such default
is not cured within thirty (30) days after the defaulting Party receives written
notice sufficient in detail to understand the nature of the default and
recommended cure thereof from the non-defaulting Party; (ii) if the other Party
makes an assignment for the benefit of its creditors, is declared insolvent, or
a receiver or trustee in bankruptcy is appointed to take charge of all or part
of the party's property; (iii) if xSides is sold, merged and/or acquired
resulting in a change of control whereby the current shareholders of xSides no
longer collectively own more than 50% of the voting shares of xSides. Unless
previously terminated by either party prior to or upon expiration, this
Agreement shall automatically be extended for an additional one (1) year period,
and if not terminated by either party prior to or upon expiration of such
additional one (1) year period, this Agreement shall be automatically extended
for a second one (1) year period.
19
11.2 Equitable Relief.
Each party agrees that the other party will, in addition to any other rights or
remedies which it may have, be entitled to obtain immediate equitable and
injunctive relief to restrain such party from any breach or threatened breach of
3 and 6 of this Agreement to avoid irreparable harm.
11.3 Effect of Termination.
In the event of termination or expiration, all licenses, rights and covenants
granted to ISV shall cease, and except for such xSides materials deemed
necessary to support ISV sublicensees, ISV shall, within thirty (30) days after
failure to cure the material breach, return to xSides all copies of the xSides
material or at xSides' written request, destroy all copies of the xSides
material and affidavit to xSides in writing such destruction has taken place.
12. GENERAL PROVISIONS
12.1 Assignment. Neither party will assign this Agreement, or the rights and
obligations hereunder, either voluntarily or by operation of law, absent the
other party's prior written consent, which consent shall not be unreasonably
withheld. Notwithstanding the foregoing, either party ("Assigning Party") may,
upon prior written notice to the other party assign all of its rights and
delegate all of its duties under this Agreement to the surviving entity in a
merger, sale, consolidation or combination of the Assigning Party or to an
entity which acquires all or substantially all of the Assigning Party's assets.
12.2 Force Majeure. Neither party shall be liable for any failure, inability, or
delay to perform hereunder due to Force Majeure, but the other party shall have
the right to terminate for such event as hereinabove provided.
12.3 Notices. Except as otherwise specified herein, all notices, requests,
demands, communications or statements (individually and collectively, "Notices")
or payments required hereunder will be made in writing, delivered personally, or
sent by certified or registered mail or commercial overnight delivery service,
with provisions for a receipt, or (except as to payments) by completed
facsimile, to the parties at their respective addresses:
If to xSides:
-------------
xSides Corporation
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, CEO
Fax: ▇▇▇-▇▇▇-▇▇▇▇
If to ISV:
----------
Y3K Secure Enterprise Software, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: CEO
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Either party may change its address upon ten (10) business days' written notice
to the other sent in accordance with the foregoing. All notices, requests,
demands, orders or communications will be deemed effective upon receipt in
accordance with this Section.
12.4 Relationship of the Parties. Nothing contained in this Agreement shall
cause or be deemed to cause the parties to be partners or joint venturers with,
or agents or employees of, each other. The parties are independent contractors,
and neither party has any right or power to create any obligation or
responsibility on behalf of the other party. Neither party will make
representations, warranties, or guaranties to anyone with respect to the
specifications, features, capabilities or operations of the other's products or
services that are inconsistent with or in addition to this Agreement and such
party's published literature.
12.5 Successors and Assigns. This Agreement is binding upon the respective
parties hereto and their permitted successors and assigns. The execution and
delivery of this Agreement will not be deemed to confer any rights or remedies
upon, or obligate any of the parties hereto, to any person or entity other than
such parties.
20
12.6 Governing Law; Jurisdiction and Venue. This Agreement and the rights and
obligations of the parties hereunder shall not be governed by the United Nations
Convention on Contracts for the International Sale of Goods, the application of
which is expressly excluded by the parties hereto. This Agreement will be
governed by, and construed and enforced in accordance with, the laws of the
State of Washington, regardless of the choice of law rules of Washington or any
other jurisdiction.
12.7 Survival. The rights and obligations pursuant to Sections 1, 2, 3.1(d), 3.2
(c), 3.4(a), 3.4(b), 4, 5, 6, 9, 10, 11, 12 and 13 shall survive the termination
of this Agreement for any reason.
12.9 Headings. Paragraph headings are for the convenience of the parties
only and shall not be used in construing meaning.
12.10 Waiver. Failure or delay on the part of either party to exercise any
right, power, privilege or remedy shall not constitute a waiver of, or bar the
later exercise of, that or any other right, power, privilege or remedy of such
party.
12.11 Severability. If a court or arbitrator of competent jurisdiction holds any
term of this Agreement invalid or unenforceable, such term shall be reduced or
otherwise modified by such court or arbitrator to the minimum extent necessary
to make it valid and enforceable. If such term cannot be so modified, it shall
be severed and the remaining terms of this Agreement shall be interpreted in
such ways as to give maximum validity and enforceability to this Agreement.
12.12 Counterparts and Facsimile. This Agreement may be executed by facsimile
and in several counterparts, each of which shall be an original and all of which
together shall constitute one original instrument.
12.13 Entire Agreement. This Agreement (together with the NDA referenced herein)
constitutes the entire understanding and agreement between the parties, and
supersedes all prior and contemporaneous written and oral communications
regarding this transaction, and may not be altered, modified or amended except
by a written amendment executed by both parties.
12.14 Authority. Each individual executing this Agreement on behalf of each
respective party acknowledges and warrants that (i) he/she has full authority to
execute this Agreement on behalf of such party, (ii) this Agreement has been
duly authorized and approved by such party, and (iii) this Agreement constitutes
a valid and binding obligation of such party.
IN WITNESS WHEREOF, the parties shall be deemed to have executed this Agreement
on the date first set forth above.
xSides Corporation, a
California corporation
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
Its: CEO
Y3K Secure Enterprise Software, Inc., a
Nevada Corporation
By: /s/ ▇▇▇▇ ▇▇. ▇▇▇▇
--------------------------------
Its: President
21