CONTRIBUTION AND RESTRICTED STOCK
PURCHASE AGREEMENT
This Contribution and Restricted Stock Purchase Agreement is made as of the
14th day of July, 1998 by and between YESLER SOFTWARE, INC. a Washington
corporation ("Company"), and ▇▇▇▇▇▇▇ CORPORATION ("▇▇▇▇▇▇▇").
WHEREAS, Company and the investors named in the Schedule of Investors
attached thereto are parties to that certain Series A Convertible Preferred
Stock Purchase Agreement dated the date hereof (the "Series A Purchase
Agreement") for the purchase of shares of Company's Series A Preferred Stock;
WHEREAS, Company has entered into a Restricted Stock Purchase Agreement
with Weld, ▇▇▇▇▇ LLC dated July 14th, 1998, for the purchase of shares of
Company's Common Stock with certain vesting provisions therein;
WHEREAS, in connection therewith, Company, the Investors and other parties
thereto have concurrently entered into a Stock Restriction Agreement. Investor
Rights Agreement and Voting Agreement, all dated the date hereof;
WHEREAS, Company and ▇▇▇▇▇▇▇ are parties to that certain OEM Agreement
dated the date hereof (the "OEM Agreement") whereby Company will have the right
to distribute certain of ▇▇▇▇▇▇▇'▇ products as set forth therein;
WHEREAS, in conjunction with all of the above, Company and ▇▇▇▇▇▇▇ desire
to enter into this Agreement for the purchase of shares of Company's Common
Stock with certain vesting provisions therein.
NOW, THEREFORE, in consideration of the mutual covenants and
representations herein set forth, Company and ▇▇▇▇▇▇▇ agree as follows:
A. Definitions
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The following terms, as used herein, shall have the following meanings:
1. "▇▇▇▇▇▇▇ Software" shall mean ▇▇▇▇▇▇▇'▇ proprietary commercial computer
software products described in ATTACHMENT 1.1, including any Updates thereto
released from time to time by ▇▇▇▇▇▇▇.
2. "alpha version" shall mean a version of computer software prior to
production of a beta version that is produced for demonstration or functionality
purposes only.
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3. "Athena" shall mean the proprietary commercial computer software
application designed for use by non-technical end-users for creating multimedia
web-based presentations that is based upon or incorporates a portion of the
Code, to be created by Company, which is presently referred to as "Athena,"
including any Updates thereto released from time to time by Company.
4. "beta version" shall mean a version of computer software after
production of all alpha versions thereof but prior to production of a release
version, which is produced for testing purposes.
5. "Customer List" shall mean such list(s) as may be obtained from
▇▇▇▇▇▇▇'▇ then-current customer database without unreasonable effort or expense,
setting forth available name, address, telephone number, e-mail address,
facsimile number and other contact information of all ▇▇▇▇▇▇▇ customers
(including without limitation, beta test customers and distribution partners)
who have consented to receive information regarding third party products.
6. "Code" shall mean the human readable source code to ▇▇▇▇▇▇▇'▇
proprietary computer programs, presently referred to as "▇▇▇▇▇▇▇ Alive," for
creating multimedia web-based presentations relating to customer support and
training in the form it existed at the date of this Agreement, including all
textual and/or graphical instructions, manuals, specifications and diagrams, in
both printed and electronic form, pertaining to the Code.
7. "Documentation" shall mean the textual and/or graphical instructions,
manuals, specifications and diagrams, in both printed and electronic form,
customarily provided to end-users of ▇▇▇▇▇▇▇ Alive, Athena or ▇▇▇▇▇▇▇ Software,
as the case may be.
8. "evaluation version" shall mean a version of computer software and any
related Documentation that is given for a limited period of time so a potential
purchaser may determine whether it is suitable for its needs.
9. "release version" shall mean a version of computer software and any
related Documentation after production of all beta versions thereof that is
produced for general commercial release by Company or ▇▇▇▇▇▇▇, as the case may
be, for purchase by or distribution to end-users through the vendor's
distribution channel.
10. "Updates" shall mean revisions, updates, upgrades, enhancements,
modifications or bug fixes to the Code, ▇▇▇▇▇▇▇ Software or Athena, as the case
may be, and/or its related Documentation produced by Company or ▇▇▇▇▇▇▇, as the
case may be.
B. Equity Purchase
---------------
1. Purchase and Sale of the Shares. Subject to the terms and conditions of
this Agreement, Company hereby sells to ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ hereby purchases
from Company 907,591 shares of Company's Common Stock (the "Shares") for the
price of $0.10 per
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share, or an aggregate of $90,759.10, the consideration for such Shares being
the licenses and services described in Sections C.1 and C.2 of this Agreement.
Company will issue, as promptly hereafter as practicable, a certificate,
registered in the name of ▇▇▇▇▇▇▇, evidencing the Shares.
2. Repurchase Option for the Shares.
---------------------------------
(a) Upon the occurrence of any of the events specified in paragraphs
(b)-(d) below, Company shall have an irrevocable right for a period of ninety
(90) days from the applicable defined date in paragraphs (b)-(d) below to
repurchase (the "Repurchase Option") any or all of (i) the Unvested Shares (as
defined in Section B.3 hereof) at a price of $0.10 per share, subject to
adjustment as set forth in Section B.10 hereof (the "Unvested Share Repurchase
Price") and (ii) the Vested Shares (as defined in Section B.3 hereof) at the
then current fair market value (the "Vested Share Repurchase Price") as
determined in good faith by either (A) the agreement of Company and ▇▇▇▇▇▇▇, or
(B) if Company and ▇▇▇▇▇▇▇ cannot agree on such fair market value within thirty
(30) days after the giving of notice as provided for in Section 2(e) (the
"Notice Date"), the valuation shall be made by an appraiser of recognized
standing selected by Company and ▇▇▇▇▇▇▇ within forty (40) days of the Notice
Date, or, if they cannot agree on an appraiser within such forty (40) day
period, each shall select an appraiser of recognized standing and the two
appraisers shall designate a third appraiser of recognized standing within sixty
(60) days of the Notice Date, whose appraisal shall be completed within thirty
(30) days after his or her appointment and whose appraisal shall be
determinative of such fair market value; provided, however, that if the
Repurchase Option is being exercised within six (6) months following the date of
this Agreement, then notwithstanding the foregoing, the Vested Share Repurchase
Price shall be $0.10 per share for such six (6) month period. The fair market
value shall be determined without regard to liquidity or the minority or
majority ownership interest involved. Each of Company and ▇▇▇▇▇▇▇ shall bear the
cost and expenses of the appraiser it appoints, and each shall bear one-half of
the cost and expenses of the third appraiser or the sole appraiser if only one
is appointed. Notwithstanding the foregoing or any other provision herein, if
Company obtains the right to exercise the Repurchase Option under this Section
B.2(a) due to a material default by ▇▇▇▇▇▇▇ in fulfilling its obligations under
Section C.2(f)(i), then (x) with respect to all Shares subject to the Repurchase
Option, both the Unvested Share Repurchase Price and the Vested Share Repurchase
Price shall be $0.01, and (y) with respect to the Shares that Company may have
previously repurchased pursuant to the Repurchase Option (if any), ▇▇▇▇▇▇▇ shall
pay to Company an amount equal to the total amount previously paid for both
Vested Shares and Unvested Shares minus $0.01 for each such share.
(b) Material Default. Should a material default by ▇▇▇▇▇▇▇ in fulfilling
its obligations under Section C.1, C.2, C.3 or E of this Agreement or under
section 1.1, 2.1, 2.2 or 3.2 of the OEM Agreement occur, and ▇▇▇▇▇▇▇ has not
cured such default within fifteen (15) days after Company has given ▇▇▇▇▇▇▇
written notice of such default, or has not commenced a curing action that is
reasonably satisfactory to Company with
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respect to a default which inevitably cannot reasonably be cured in such period,
then the day immediately following the fifteenth day shall be deemed the
"Default Date."
(c) Change in Control. Should any of the following transactions occur (a
"Change in Control Transaction"): (i) any merger, consolidation, reorganization
or other transaction, including a stock purchase or tender offer, pursuant to
which the persons who hold the outstanding shares of common stock of ▇▇▇▇▇▇▇
immediately prior to the transaction have immediately following the transaction
less than fifty percent (50%) of the combined voting power of the outstanding
securities of the surviving entity ordinarily (and apart from rights accruing
under special circumstances) having the right to vote in the election of
directors; or (ii) any sale, lease, exchange or other transfer not in the
ordinary course of business (in one transaction or a series of related
transactions) of all, or substantially all, of the assets of ▇▇▇▇▇▇▇, the
effective date of such Change in Control Transaction shall be deemed the "Change
in Control Date."
(d) Termination Date. Should ▇▇▇▇▇▇▇ elect to terminate this Agreement
pursuant to Section D.1, the effective date of such termination shall be deemed
the "Termination Date."
(e) The Repurchase Option shall be exercised by Company within ninety
(90) days following the applicable defined date set forth in paragraphs (b)-(d)
above by delivering or mailing to ▇▇▇▇▇▇▇ (i) written notice in the manner
provided for in Section F.4 hereof, and (ii) a check in the amount of the
aggregate Vested Share Repurchase Price and Unvested Share Repurchase Price, as
applicable; provided, however, that if the Vested Share Repurchase Price has not
been determined pursuant to Section 2(a) within such 90-day period, then payment
for the Vested Shares shall occur within ten (10) days after determination of
the fair market value in accordance with Section 2(a) hereof. Upon delivery of
such notice and the payment of the applicable repurchase price as described
above, Company shall become the legal and beneficial owner of the Shares being
repurchased for which payment had been made and all rights and interest therein
or relating thereto, and Company shall have the right to retain and transfer to
its own name the number of Shares being repurchased by Company.
(f) Upon any exercise of the Repurchase Option for the purchase of
Unvested Shares, all of ▇▇▇▇▇▇▇'▇ obligations under Sections C.1(e) and C.2
hereof (except for Section C.2(f), which shall survive any exercise of the
Repurchase Option) shall cease.
(g) The Repurchase Option is not assignable by Company unless ▇▇▇▇▇▇▇
consents in writing to such assignment.
3. Vesting of Shares.
------------------
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(a) The Shares subject to this Agreement shall vest as follows provided
that none of the Default Date, the Change in Control Date nor the Termination
Date has occurred:
(i) 302,531 of the Shares shall be immediately vested upon the date
of this Agreement; and
(ii) the remaining 605,060 Shares shall vest, so long as this
Agreement is not terminated, at the rate of 50,421 Shares at the end of each
three (3) month period, commencing on the date of this Agreement, until all such
shares are fully released.
(b) Any of the Shares which have not yet vested are referred to herein
as "Unvested Shares."
(c) Any of the Shares which have vested are referred to herein as
"Vested Shares."
(d) Notwithstanding the foregoing, all of the Shares subject to this
Agreement shall be completely released from the Repurchase Option on the
effective date of such termination of this Agreement unless termination is
pursuant to Section D.2 or unless this Agreement is terminated by ▇▇▇▇▇▇▇
pursuant to Section D.1.
4. Representations of ▇▇▇▇▇▇▇. In connection with ▇▇▇▇▇▇▇'▇ purchase of the
Shares, ▇▇▇▇▇▇▇ hereby represents and warrants to Company as follows:
(a) Investment Intent; Capacity to Protect Interests. ▇▇▇▇▇▇▇ is
purchasing the Shares solely for its own account for investment and not with a
view to or for sale in connection with any distribution of the Shares or any
portion thereof and not with any present intention of selling, offering to sell
or otherwise disposing of or distributing the Shares or any portion thereof in
any transaction other than a transaction exempt from registration under the
Securities Act of 1933, as amended (the "Securities Act"). ▇▇▇▇▇▇▇ also
represents that the entire legal and beneficial interest of the Shares is being
purchased, and will be held, for ▇▇▇▇▇▇▇'▇ account only, and neither in whole or
in part for any other person. By reason of ▇▇▇▇▇▇▇'▇ business or financial
experience or the business or financial experience of ▇▇▇▇▇▇▇'▇ professional
advisors who are unaffiliated with and who are not compensated by Company or any
affiliate or selling agent of Company, ▇▇▇▇▇▇▇, directly or indirectly, could be
reasonably assumed to have the capacity to evaluate the merits and risks of an
investment in Company and to protect ▇▇▇▇▇▇▇'▇ own interests in connection with
this transaction.
(b) Resident. ▇▇▇▇▇▇▇'▇ principal place of business is as set forth on
the signature page hereof.
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(c) Information Concerning Company. ▇▇▇▇▇▇▇ has heretofore discussed
Company and its plans, operations and financial condition with Company's
officers, knows that Company is engaged in a speculative business and has
heretofore received all such information as ▇▇▇▇▇▇▇ has deemed necessary and
appropriate to enable ▇▇▇▇▇▇▇ to evaluate the financial risk inherent in making
an investment in the Shares, and ▇▇▇▇▇▇▇ has received satisfactory and complete
information concerning the business and financial condition of Company in
response to all inquiries in respect thereof.
(d) Economic Risk. ▇▇▇▇▇▇▇ realizes that the purchase of the Shares will
be a highly speculative investment and involves a high degree of risk, and
▇▇▇▇▇▇▇ is able, without impairing its financial condition, to hold the Shares
for an indefinite period of time and to suffer a complete loss of ▇▇▇▇▇▇▇'▇
investment.
(e) Restricted Securities. ▇▇▇▇▇▇▇ understands and acknowledges that:
(i) The sale of the Shares has not been registered under the
Securities Act, and the Shares must be held indefinitely unless subsequently
registered under the Securities Act or an exemption from such registration is
available (such as Rule 144 or the resale provisions of Rule 701 under the
Securities Act);
(ii) The share certificate representing the Shares will be stamped
with the legends specified in Section B.8 hereof; and
(iii) Company will make a notation in its records of the
aforementioned restrictions on transfer and legends.
(f) Disposition under the Securities Act. ▇▇▇▇▇▇▇ understands that the
Shares are restricted securities within the meaning of Rule 144 promulgated
under the Securities Act; that the exemption from registration under Rule 144
will not be available in any event for at least one (1) year from the date of
purchase and payment of the Shares and even then will not be available unless
(i) a public trading market then exists for the Common Stock of Company, (ii)
adequate information concerning Company is then available to the public, and
(iii) other terms and conditions of Rule 144 are complied with; and that any
sale of the Shares may be made only in limited amounts in accordance with such
terms and conditions. There can be no assurance that the requirements of Rule
144 will be met, or that the stock will ever be saleable.
(g) Further Limitations on Disposition. Without in any way limiting the
representations set forth above, ▇▇▇▇▇▇▇ further agrees that it shall in no
event make any disposition of all or any portion of the Shares unless and until:
(i) (A) There is then in effect a Registration Statement under the
Securities Act covering such proposed disposition and such disposition is made
in accordance with said Registration Statement; (B) the resale provisions of
Rule 144 are available in the opinion of counsel to Company; or (C)(1) ▇▇▇▇▇▇▇
shall have notified
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Company of the proposed disposition and shall have furnished Company with a
detailed statement of the circumstances surrounding the proposed disposition,
(2) ▇▇▇▇▇▇▇ shall have furnished Company with an opinion of ▇▇▇▇▇▇▇'▇ counsel to
the effect that such disposition will not require registration of such Shares
under the Securities Act, and (3) such opinion of ▇▇▇▇▇▇▇'▇ counsel shall have
been concurred with by counsel for Company and Company shall have advised
▇▇▇▇▇▇▇ of such concurrence; and
(ii) The Shares proposed to be transferred shall no longer be
subject to the Repurchase Option set forth in Section B.2 hereof and ▇▇▇▇▇▇▇
shall have complied with the "lock-up" provisions set forth in Section B.9
hereof and the right of first refusal and other transfer restrictions set forth
in that certain Stock Restriction Agreement dated the date hereof by and among
Company, the Investors, ▇▇▇▇▇▇▇ and Weld, ▇▇▇▇▇ (as such parties are defined in
such agreement) (the "Stock Restriction Agreement").
(h) Section 83(b) Election. ▇▇▇▇▇▇▇ understands that Section 83 of the
Internal Revenue Code of 1986 (the "Code"), taxes as ordinary income the
difference between the amount paid for the Shares and the fair market value of
the Shares as of the date any restrictions on the Shares lapse. In this context,
"restriction" means the right of Company to buy back the Shares pursuant to the
repurchase options. ▇▇▇▇▇▇▇ understands that it may elect to be taxed at the
time the Shares are purchased rather than when and as the repurchase options
expire by filing an election under Section 83(b) of the Code with the Internal
Revenue Service within thirty (30) days from the date of purchase. Even if the
fair market value of the Shares equals the amount paid for the Shares, the
election must be made to avoid adverse tax consequences in the future. The form
for making this election is attached as Exhibit A hereto. ▇▇▇▇▇▇▇ understands
that failure to make this filing timely will result in the recognition of
ordinary income by ▇▇▇▇▇▇▇, as the repurchase options lapse, on the difference
between the purchase price and the fair market value of the Shares at the time
such restrictions lapse.
▇▇▇▇▇▇▇ ACKNOWLEDGES THAT IT IS ▇▇▇▇▇▇▇'▇ SOLE RESPONSIBILITY AND NOT
COMPANY'S TO FILE TIMELY THE ELECTION UNDER SECTION 83(b), EVEN IF ▇▇▇▇▇▇▇
REQUESTS COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON ▇▇▇▇▇▇▇'▇ BEHALF.
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5. Other Documents/Matters.
------------------------
(a) Representations and Warranties of Company. Subject in part to the
accuracy of the representations of ▇▇▇▇▇▇▇ set forth in Section 4 hereof,
Company hereby affirms to ▇▇▇▇▇▇▇ the same representations and warranties made
in Section 4 of the Series A Purchase Agreement.
(b) Transfer Restrictions. The restrictions on any proposed transfer of
the Shares are as set forth in the Stock Restriction Agreement.
6. Rights as Shareholder. Subject to the terms and conditions of this
Agreement, ▇▇▇▇▇▇▇ shall have all of the rights of a shareholder of Company with
respect to the Shares from and after the date that ▇▇▇▇▇▇▇ delivers full payment
for the Shares until such time as ▇▇▇▇▇▇▇ disposes of the Shares or Company
and/or its assignee(s) exercises the repurchase options hereunder. Upon such
exercise, ▇▇▇▇▇▇▇ shall have no further rights as a holder of the Shares so
purchased except the right to receive payment for the Shares so purchased in
accordance with the provisions of this Agreement, and ▇▇▇▇▇▇▇ shall forthwith
cause the certificate(s) evidencing the Shares so purchased to be surrendered to
Company for transfer or cancellation.
7. Escrow. As security for the faithful performance of this Agreement,
▇▇▇▇▇▇▇ agrees, immediately upon receipt of the certificate(s) evidencing the
Shares, to deliver such certificate(s), together with a stock power in the form
of Exhibit B attached hereto, executed by ▇▇▇▇▇▇▇ (with the date and number of
Shares left blank), to the Secretary of Company or its designee ("Escrow
Agent"); said documents are to be held by the Escrow Agent pursuant to the Joint
Escrow Instructions of Company and ▇▇▇▇▇▇▇ set forth in Exhibit C attached
hereto and incorporated by this reference, which instructions shall also be
delivered to the Escrow Agent upon execution of this Agreement.
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8. Restrictive Legends and Stop-Transfer Orders.
(a) Legends. ▇▇▇▇▇▇▇ understands and agrees that Company shall cause the
legends set forth below or legends substantially equivalent thereto, to be
placed upon any certificate(s) evidencing ownership of the Shares together with
any other legends that may be required by state or federal securities laws:
(i) THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED UNDER
THE ACT OR, IN THE OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER
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OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER IS IN
COMPLIANCE THEREWITH.
(ii) THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS AS SET FORTH IN THE AGREEMENT BETWEEN THE ISSUER AND
THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE
OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH RESTRICTIONS
ARE BINDING ON TRANSFEREES OF THESE SHARES.
(iii) Any legends set forth in the Stock Restriction Agreement and that
certain Voting Agreement dated the date hereof, by and among
Company, the Investors, ▇▇▇▇▇▇▇ and Weld ▇▇▇▇▇ (as such parties
are defined in such agreement).
(b) Stop-Transfer Notices. ▇▇▇▇▇▇▇ agrees that, in order to ensure
compliance with the restrictions referred to herein, Company may issue
appropriate "stop transfer" instructions to its transfer agent, if any, and
that, if Company transfers its own securities, it may make appropriate notations
to the same effect in its own records.
(c) Refusal to Transfer. Company shall not be required (i) to transfer
on its books any Shares that have been sold or otherwise transferred in
violation of any of the provisions of this Agreement or (ii) to treat as the
owner of such Shares or to accord the right to vote or pay dividends to any
▇▇▇▇▇▇▇ or other transferee to whom such Shares shall have been so transferred.
9. Market Standoff Agreement. ▇▇▇▇▇▇▇ hereby agrees that if so requested by
Company or any representative of the underwriters in connection with any
registration of the offering of any securities of Company under the Securities
Act, ▇▇▇▇▇▇▇ shall not sell or otherwise transfer any Shares or other securities
of Company during the one hundred eighty (180) day period following the
effective date of a registration statement of Company filed under the Securities
Act (or in the case of any registration statement filed after an initial public
offering, ninety (90) days after such effective date). Company may impose
stop-transfer instructions with respect to securities subject to the foregoing
restrictions until the end of such period.
10. Adjustment for Stock Split. All references to the number of Shares and
the purchase price for the Shares in this Agreement shall be appropriately
adjusted to reflect any stock split, stock dividend or other change in the
Shares which may be made by Company after the date of this Agreement.
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C. Intellectual Property
---------------------
1. Assignment of Code; Licenses; Delivery Of Materials.
----------------------------------------------------
(a) Assignment of Code. ▇▇▇▇▇▇▇ hereby irrevocably sells, grants,
transfers and assigns to Company all right, title and interest in and to the
Code, free and clear of any liens, encumbrances or restrictions, and does hereby
deliver good and marketable title to the Code to Company.
(b) Grant-back License to Code. Subject to the terms and conditions
hereof, Company hereby grants to ▇▇▇▇▇▇▇ a fully-paid, perpetual, non-exclusive,
irrevocable, worldwide license to use the Code solely for its internal use,
including for use in developing Updates to the Code and for use in its website,
except to the extent that any such use by ▇▇▇▇▇▇▇ would violate any of the
provisions of this Agreement (including, without limitation, Sections C.2(f) and
C.3); provided, however, that the foregoing shall not be deemed to prohibit
▇▇▇▇▇▇▇ from using general programming concepts and know-how acquired by it in
the process of developing the Code, so long as such use does not involve use of
the Code and is otherwise within the scope of the license granted in this
Section C.2(b). This Section C.2(b) shall survive termination of this Agreement.
(c) License to Updates to the Code. Subject to the terms and conditions
hereof, ▇▇▇▇▇▇▇ hereby grants to Company a fully-paid, perpetual, exclusive,
irrevocable, worldwide, license to use, copy, modify and prepare derivative
works of, market and distribute, and to sublicense third parties to do any or
all of the foregoing, all Updates to the Code and related Documentation provided
hereunder prior to the termination or expiration of this Agreement in accordance
with its terms. This Section C.2(c) shall survive termination of this Agreement.
(d) License to ▇▇▇▇▇▇▇ Software. Subject to the terms and conditions
hereof, ▇▇▇▇▇▇▇ hereby grants to Company a fully-paid, perpetual, non-exclusive,
irrevocable, worldwide license to use a reasonable number of alpha, beta and
release versions of the ▇▇▇▇▇▇▇ Software and any related Documentation provided
hereunder prior to the termination or expiration of this Agreement in accordance
with its terms, except to the extent that such use by Company would violate the
provisions of Section C.3 (1) to maintain compatibility of Athena with the
▇▇▇▇▇▇▇ Software, (2) to develop new products compatible with the ▇▇▇▇▇▇▇
Software and (3) otherwise in accordance with the applicable beta agreement or
applicable commercial end-user license agreement. Company's right to bundle and
ship release versions of any or all of the ▇▇▇▇▇▇▇ Software with Athena shall be
governed by the OEM Agreement. This Section C.2(d) shall survive termination of
this Agreement.
(e) License to Athena. Subject to the terms and conditions hereof,
Company hereby grants to ▇▇▇▇▇▇▇ a fully-paid, perpetual, non-exclusive,
non-transferable, irrevocable, worldwide license to internally use a reasonable
number of
11
alpha, beta and release versions of Athena provided hereunder prior to the
termination or expiration of this Agreement in accordance with its terms,
including use in its website, (1) except to the extent that such internal use by
▇▇▇▇▇▇▇ would violate the provisions of this Agreement (including, without
limitation, Sections C.2(f) and C.3) and (2) otherwise in accordance with the
applicable beta agreement or applicable commercial end-user license agreement.
If ▇▇▇▇▇▇▇ desires to bundle and ship release versions of any or all of Athena
with the ▇▇▇▇▇▇▇ Software, the parties shall enter into a written OEM agreement
containing mutually agreeable terms and conditions. This Section C.2(e) shall
survive termination of this Agreement.
(f) Delivery of Code. Upon execution of this Agreement, ▇▇▇▇▇▇▇ shall
deliver to Company at no charge one complete copy of the Code in electronic
format (on machine readable diskette, CD-ROM or such other suitable means as may
be agreed to by the parties), together with any related tools and Documentation.
In addition, during the term of this Agreement and at no charge, ▇▇▇▇▇▇▇ will
promptly deliver to Company copies of any Update of the Code and any related
Documentation that ▇▇▇▇▇▇▇ may make, but in any event no later than fourteen
(14) days after such Update is first used by ▇▇▇▇▇▇▇ in production on ▇▇▇▇▇▇▇'▇
external website, for use by Company in accordance with the license granted in
(a) above. Company acknowledges and agrees that ▇▇▇▇▇▇▇ is under no obligation
to develop any Updates to the Code. The copies of both the original and Update
versions of the Code to be provided shall be in electronic format (on machine
readable diskette, CD-ROM or such other suitable electronic format as may be
agreed upon by the parties).
(g) Delivery of Alpha, Beta and Updates. During the term of this
Agreement and at no charge, ▇▇▇▇▇▇▇ will deliver to Company copies of each alpha
version, beta version, release version and Update of the ▇▇▇▇▇▇▇ Software,
together with any related Documentation, no later than two (2) weeks after the
date such alpha version, beta version, release version or Update is first sold,
given, licensed, authorized or otherwise provided by ▇▇▇▇▇▇▇ to any third party,
for use by Company in accordance with the license granted in (b) above. The
copies to be provided shall be in electronic format (on machine readable
diskette, CD-ROM or such other suitable electronic format as may be agreed upon
by the parties).
(h) Delivery of Athena. During the term of this Agreement and at no
charge, Company will promptly supply ▇▇▇▇▇▇▇ with copies of each alpha version,
beta version, release version and Update of Athena produced by Company, together
with any related Documentation, for use by ▇▇▇▇▇▇▇ in accordance with the
license granted in (c) above. The copies to be provided shall be in electronic
format on machine readable diskette, CD-ROM or such other suitable electronic
format as may be agreed upon by the parties).
(i) Ownership and Modification of Code. Subject the license granted to
▇▇▇▇▇▇▇ under Section C.1(b) of this Agreement, Company retains all right, title
and
12
interest in and to the Code and any related Documentation, including, without
limitation, all copyrights and trademarks. Company reserves the right, in its
sole discretion, to modify, improve or discontinue any or all of the Code and
any related Documentation at any time or from time to time.
(j) Ownership and Modification of Athena. Subject to the license granted
to ▇▇▇▇▇▇▇ under Section C.1(e) of this Agreement, Company retains all right,
title and interest in and to Athena and any related Documentation, including,
without limitation, all copyrights and trademarks. Company reserves the right,
in its sole discretion, to modify, improve or discontinue any or all of Athena
and any related Documentation at any time or from time to time.
2. Additional Responsibilities of ▇▇▇▇▇▇▇.
---------------------------------------
(a) Technical Support for the Code. During the term of this Agreement,
▇▇▇▇▇▇▇ shall provide reasonable technical support to Company concerning the
operation, capabilities, compatibilities and other aspects of the Code and
Company's development of Athena relating thereto. Such technical support shall
include, without limitation, providing call-back response to Company's requests
for support as promptly as possible, but in any event within two (2) business
days, and access to an assigned employee of ▇▇▇▇▇▇▇ with adequate knowledge of
and experience with the Code and the ▇▇▇▇▇▇▇ Software. The parties hereby agree
that ▇▇▇▇ ▇▇▇▇▇▇ shall be such assigned employee unless and until a substitute
with comparable knowledge and experience is designated by ▇▇▇▇▇▇▇.
(b) Product Planning Meetings. The parties agree that in order to enable
Company to offer Athena products compatible with the ▇▇▇▇▇▇▇ Software
concurrently with or soon after ▇▇▇▇▇▇▇'▇ release of a new Update to the ▇▇▇▇▇▇▇
Software (a "New Release"), upon Company's request (but not more frequently than
quarterly) appropriate engineering and product marketing staff from ▇▇▇▇▇▇▇ will
meet with Company at a mutually acceptable time and location to discuss
▇▇▇▇▇▇▇'▇ product development plans for potential New Releases. If and to the
extent any written information relevant to any such New Releases is provided at
such meetings, ▇▇▇▇▇▇▇ shall provide Company with such information; provided,
however, that if for confidentiality reasons ▇▇▇▇▇▇▇ requires all participants
at such meetings to return such information, then Company shall comply with such
requirement.
(c) Technical Support for Compatibility. During the term of this
Agreement, ▇▇▇▇▇▇▇ shall provide reasonable technical support to Company
relating to Company's efforts to modify, fix or upgrade Athena and the related
Documentation in order to be compatible with the ▇▇▇▇▇▇▇ Software and any New
Releases. Such technical support shall include, without limitation, providing
call-back response to Company's requests for support as promptly as possible,
but in any event within two (2) business days, and access to an assigned
employee of ▇▇▇▇▇▇▇ with adequate knowledge and
13
experience. The parties hereby agree that ▇▇▇ ▇▇▇▇▇ shall be such assigned
employee unless and until a substitute with comparable knowledge and experience
is designated by ▇▇▇▇▇▇▇.
(d) Mailings to ▇▇▇▇▇▇▇'▇ Customer List. At any time after the execution
of this Agreement and at Company's request, Company shall be permitted, at
Company's sole expense and through a bonded mail house, to make a "blind"
promotional mailing regarding Athena to ▇▇▇▇▇▇▇'▇ Customer List. Company shall
be permitted to make additional blind promotional mailings regarding Athena and
any other products of Company developed using the ▇▇▇▇▇▇▇ Software to ▇▇▇▇▇▇▇'▇
Customer List; provided, that mailings are made no more frequently than once per
quarter to any particular customer (it being understood and agreed that more
than one mailing may be made in the same quarter subject to the foregoing
restriction), unless otherwise agreed to by ▇▇▇▇▇▇▇. Nothing contained herein
shall prohibit or restrict Company from making any mailings to Company's
customers.
(e) Access to Sales and Distribution Channels. During the term of this Agreement
and upon Company's request (and at no charge to Company), ▇▇▇▇▇▇▇ shall (i)
assist Company in identifying appropriate customers, beta version test customers
and/or distribution partners for Athena, (ii) include in designated shipments of
the ▇▇▇▇▇▇▇ Software advertisements and/or promotional materials as reasonably
requested by Company to all or part of ▇▇▇▇▇▇▇'▇ Customer List (such materials
to be provided by Company at its expense), (iii) facilitate and participate in
personal introductions of Company to certain customers from ▇▇▇▇▇▇▇'▇ Customer
List designated by Company and (iv) cooperate with Company in other co-marketing
arrangements, including, without limitation, participation in and attendance at
appropriate trade shows.
(f) Non-Competition; Non-Solicitation. During the term of this Agreement
and for one (1) year after the earlier to occur of (1) exercise of the
Repurchase Option or (2) termination hereof, ▇▇▇▇▇▇▇ shall not (i) have an
ownership interest in or control (as defined below) any business which offers or
provides a product which competes with Athena anywhere in the world, nor shall
it assist any third party by providing management, consulting, development or
other services (other than by providing support to its OEMs and other users of
the ▇▇▇▇▇▇▇ Software in the use of and establishing compatibility with the
▇▇▇▇▇▇▇ Software) to compete with Athena anywhere in the world, (ii) induce or
attempt to induce any employee of Company to leave Company's employ or in any
way interfere with the relationship between Company and any of its employees for
any reason, including without limitation, becoming employed or otherwise engaged
by ▇▇▇▇▇▇▇ (or any person or entity associated with ▇▇▇▇▇▇▇) in any capacity,
nor will it assist others to do so or (iii) induce or attempt to induce any
customer, supplier, licensee or other business relation of Company to cease
doing business with Company, or in any way interfere with the relationship
between any customer, supplier, licensee or other business relation and Company,
nor will it assist others to do so; provided, however, that nothing herein shall
prevent the purchase or ownership by ▇▇▇▇▇▇▇ of shares
14
which constitute less than one percent of the outstanding equity securities of a
publicly-held company. For purposes of this Section C.2(f), "control" shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the affairs or management of a person or entity, whether through
the ownership of voting securities, as trustee or executor, by contract or
otherwise. In the event Company fails to use commercially reasonable efforts to
develop versions of Athena compatible with Cold Fusion technology with
substantially equivalent features and functionalities as versions of Athena (the
"Other Versions") compatible with other platforms (other than features or
functionalities which are inapplicable or not commercially feasible due to
limitations or characteristics of Cold Fusion technology) within a reasonable
period of time (generally understood not to exceed 90 days) after release of the
Other Versions, then ▇▇▇▇▇▇▇ will cease to be bound by this Section C.2(f).
▇▇▇▇▇▇▇ acknowledges and agrees that, in the event of any violation by it of any
provision of Section C.2(f)(ii) or (iii), Company will suffer irreparable and
ongoing harm which, while substantial, will not be fully compensable by damages.
As a consequence, in the event of any actual or threatened breach of Section
C.2(f)(ii) or (iii), Company may, in addition and supplementary to any and all
other rights and remedies existing in its favor, seek to obtain immediate and
ongoing injunctive relief, enjoining or restraining whatever violation may have
occurred or be occurring or may have been threatened. This injunctive relief
shall be in the form of a temporary restraining order, preliminary injunction or
similar relief, and a permanent injunction, as may be sought by Company. In the
event of any violation by ▇▇▇▇▇▇▇ of Section C.2(f)(i), Company's sole and
exclusive remedy shall be to exercise the Repurchase Option in accordance with
Section B.2(a).
3. Proprietary Information; Non-Disclosure.
----------------------------------------
(a) Confidential Information. "Confidential Information," for purposes
of this Agreement, includes all information disclosed by a party that is marked
as confidential or proprietary, or is received under circumstances reasonably
interpreted as imposing an obligation of confidentiality. Confidential
Information includes, but is not limited to, the Code, Athena and all
proprietary technology, schematics, know-how, procedures, engineering data,
software structures, drawings, price lists, business plans, servicing guides and
documentation, disclosed by such party (the "Disclosing Party") to the other
party (the "Receiving Party"). In order to preserve the value of the Code to
Company, ▇▇▇▇▇▇▇ agrees that it will hold and use the Code as if it were
Confidential Information of Company. Notwithstanding the foregoing, Confidential
Information shall not include any information (i) that is or becomes readily
available in public records or documents, other than as a result of an improper
disclosure by the Receiving Party or any affiliate or other person acting on its
behalf, (ii) which can be shown to have been known by the Receiving Party prior
to its disclosure by the Disclosing Party, (iii) which must be disclosed by the
Receiving Party under applicable laws or regulations or judicial or
administrative proceedings, (iv) that is received by the Receiving Party from a
third party
15
free to lawfully disclose such information or (v) that is subsequently
independently developed by the Receiving Party.
(b) Protection of Confidential Information. The Receiving Party shall
and shall cause any other person acting on its behalf to (i) hold the
Confidential Information of the Disclosing Party in strictest confidence, (ii)
exercise the highest degree of care in safeguarding such Confidential
Information against any and all loss, theft or other inadvertent disclosure, and
(iii) take such steps as are necessary to ensure and maintain such
confidentiality.
(c) Use of Confidential Information. Without the prior written consent
of the Disclosing Party, the Receiving Party shall not, and shall cause its
directors, officers, employees, affiliates and any other person acting on its
behalf to not (i) disclose, transfer or in any way divulge, directly or
indirectly, any of the Confidential Information of the Disclosing Party, under
any circumstances or by any means, to any third party (other than to third
parties performing services for the Receiving Party, which third parties are
subject to confidentiality obligations not less restrictive than those imposed
by this Agreement), (ii) copy, transmit, reproduce, summarize, quote, or make
any commercial use whatsoever of any of such Confidential Information, or (iii)
use any of the Confidential Information for any purpose other than for
performance of the Receiving Party's obligations hereunder.
(d) Survival. The Confidential Information of the Disclosing Party shall
remain the exclusive property of the Disclosing Party. The obligations of each
party hereunder shall survive termination of this Agreement for so long as such
party is in possession of any Confidential Information; provided, however, that
notwithstanding anything to the contrary contained in this Agreement, during and
following termination of this Agreement Company shall be permitted to use the
Code in accordance with the paid-up license granted under this Agreement.
(e) Ownership of ▇▇▇▇▇▇▇ Software. Company agrees that all right, title
and interest in and to any trademark, trade name, service ▇▇▇▇, patent,
copyright or other property right incorporated in or relating to the ▇▇▇▇▇▇▇
Software and any related Documentation are and shall remain vested solely in
▇▇▇▇▇▇▇. Company shall not attempt to register any name, symbol or ▇▇▇▇ of
▇▇▇▇▇▇▇, nor any name, symbol or ▇▇▇▇ similar thereto. Company will retain and
not obscure or alter in any way the serial numbers and copyright, proprietary
rights and trademark notices in the ▇▇▇▇▇▇▇ Software.
(f) Ownership of Athena. ▇▇▇▇▇▇▇ agrees that all right, title and
interest in and to any trademark, trade name, service ▇▇▇▇, patent, copyright or
other property right incorporated in or relating to Athena and any related
Documentation (other than the Code and Documentation licensed to Company under
this Agreement) are and shall remain vested solely in Company. ▇▇▇▇▇▇▇ shall not
attempt to register any name, symbol or ▇▇▇▇ of Company, nor any name, symbol or
▇▇▇▇ similar thereto. ▇▇▇▇▇▇▇ will retain
16
and not obscure or alter in any way the serial numbers and copyright,
proprietary rights and trademark notices in Athena or any related Documentation.
D. Term And Termination
--------------------
1. This Agreement will continue in effect until terminated for any or no
reason by either party with at least six (6) months prior written notice to the
other party.
2. Notwithstanding Section D.1, Company may terminate this Agreement
immediately upon notice to ▇▇▇▇▇▇▇ if: (a) ▇▇▇▇▇▇▇ is in breach of any
representation, warranty or obligation hereunder and such breach is not fully
cured within fifteen (15) days after Company has given ▇▇▇▇▇▇▇ written notice of
such breach; or (b) has not commenced a curing action that is reasonably
satisfactory to ▇▇▇▇▇▇▇ with respect to a breach which inevitably cannot be
reasonably cured in such period.
3. Notwithstanding Section D.1, ▇▇▇▇▇▇▇ may terminate this Agreement
immediately upon notice to Company if: (a) Company is in breach of any
representation, warranty or obligation hereunder and such breach is not fully
cured within fifteen (15) days after ▇▇▇▇▇▇▇ has given Company written notice of
such breach; or (b) has not commenced a curing action that is reasonably
satisfactory to Company with respect to a breach which inevitably cannot be
reasonably cured in such period.
4. Upon termination of this Agreement, the following shall occur:
(a) The assignment of the Code under Section C.1(a) and the licenses
granted under Sections C.1(b), (c), (d) and (e) prior to such termination, and
all respective rights and obligations of the parties arising under Sections B,
C.2(f), C.3 and E shall survive such termination in accordance with their terms
(except that if Company terminates this Agreement other than pursuant to Section
D.2, the rights and obligations of the parties arising under Section C.2(f)
shall not survive), it being agreed that all other rights and obligations of the
parties shall thereafter terminate;
(b) For a period of two (2) years after the effective date of such
termination, Company will be given the opportunity to participate as a member of
all distribution partner programs offered by ▇▇▇▇▇▇▇, if any, so long as Company
meets the standard qualifications for such programs;
(c) Upon request by Company, ▇▇▇▇▇▇▇ shall immediately deliver to
Company all copies, diskettes, and other documents containing any Confidential
Information of Company, except for the copies of Athena provided to ▇▇▇▇▇▇▇
hereunder; and
(d) Upon request by ▇▇▇▇▇▇▇, Company shall immediately deliver to
▇▇▇▇▇▇▇ all copies, diskettes, and other documents containing any Confidential
Information
17
of ▇▇▇▇▇▇▇, except for the copies of the ▇▇▇▇▇▇▇ Software and Documentation
provided to Company hereunder and the Code.
5. Should this Agreement be terminated by ▇▇▇▇▇▇▇ pursuant to Section D.1
or should this Agreement be terminated by the Company pursuant to Section D.2,
▇▇▇▇▇▇▇ shall provide a $120,000 credit against future purchases from ▇▇▇▇▇▇▇ by
the Company. Such $120,000 credit shall be reduced by $10,000 each calendar
quarter commencing at the end of the first calendar quarter following the date
of this Agreement.
E. Limited Warranties; Limitation Of Liability
-------------------------------------------
1. ▇▇▇▇▇▇▇ represents and warrants that (a) the Code and ▇▇▇▇▇▇▇ Software,
in the form delivered by ▇▇▇▇▇▇▇ to Company, do not and will not infringe any
valid United States patent, copyright, trademark or other intellectual property
right of any third party, (b) ▇▇▇▇▇▇▇ owns all right, title and interest in and
to, or has sufficient legal rights and interests to use and sell or license to
Company the right to use (as contemplated by this Agreement) the Code and
▇▇▇▇▇▇▇ Software in the form delivered to Company, (c) no claims have been
asserted, and no claims are pending, by any third party regarding infringement
by the Code and ▇▇▇▇▇▇▇ Software in the form delivered hereunder, and to the
best knowledge of Company there is no basis for any such claim and (d) the legal
rights and interests of ▇▇▇▇▇▇▇ in the Code and ▇▇▇▇▇▇▇ Software transferred
hereby are adequate and sufficient to permit Company to license and sell Athena
as contemplated hereby. Company represents and warrants that Athena, in the form
delivered by Company to ▇▇▇▇▇▇▇, do not and will not infringe any valid United
States patent, copyright, trademark or other intellectual property right of any
third party. The Code, ▇▇▇▇▇▇▇ Software and Athena provided under this Agreement
are collectively referred to herein as the "Software." ▇▇▇▇▇▇▇ and Company
warrant that the media on which any Software is provided to the other hereunder
are free from defects in material and workmanship under normal use and that the
Software recorded therein is properly recorded. Neither party warrants to the
other that the functions contained in the Software will meet the other party's
or its customers' requirements, that Software is free from defects or that the
operation of the Software will be uninterrupted or error free. Except for the
express warranties provided under Sections E.1 and E.2, all Software is provided
hereunder on an "AS IS" basis.
2. Each party shall indemnify, hold harmless and, at the other's request,
defend the other, its subsidiaries and affiliates from and against all claims,
liabilities, damages, losses and expenses including, but not limited to
reasonable attorney's fees and costs of suit, arising out of or in connection
with all claims that the use of the Software provided hereunder by the
indemnifying party violates any valid United States patent, copyright, trademark
or other intellectual property right of any third party, and which are awarded
against the indemnified party after a final adjudication of such claims from
which no appeal has been or may be made; provided, that the indemnified party
(a) notifies the indemnifying party promptly in writing of any claim or suit
within the
18
scope of this indemnity, (b) cooperates with the indemnifying party by providing
information and assistance to settle and/or to defend any such claim or action,
and (c) gives the indemnifying party full authority to control the defense
and/or settlement of any such claim or action, subject only to the right of the
indemnified party to control the defense of any claims directly affecting its
interests in its own proprietary materials. If any Software is held in any suit
or proceeding to infringe any United States patent, copyright, mask work, trade
secret, trade ▇▇▇▇ or other proprietary right of any third party and its use is
enjoined, the party which provided such Software, at its option and own expense,
will either (i) procure for the other party the right to continue using the
Software which is alleged to be infringing; (ii) modify such Software so that it
becomes non-infringing while giving equivalent performance; (iii) replace the
Software with non-infringing technology or materials which give equivalent or
better performance or (iv) return all consideration received in exchange for the
license of the infringing Software (which in the case of ▇▇▇▇▇▇▇, shall be all
of the Shares). Notwithstanding the foregoing, neither party shall have any
obligation or liability under this Section E arising from the modification of
such party's Software after delivery to the other party hereunder or the
combination of such party's Software with any products not supplied by such
party, and where, but for such modification or combination, no infringement
would have occurred. THE FOREGOING STATES THE INDEMNIFYING PARTY'S SOLE
RESPONSIBILITY, AND THE INDEMNIFIED PARTY'S SOLE REMEDY, FOR ANY INFRINGEMENTS
OF ANY PROPRIETARY RIGHTS. The obligations of each party under this Section E
shall survive termination of this Agreement.
3. THE WARRANTIES SET FORTH IN THIS SECTION E ARE THE ONLY WARRANTIES MADE
BY ▇▇▇▇▇▇▇ OR COMPANY. NO OTHER WARRANTIES HAVE BEEN MADE BY ▇▇▇▇▇▇▇ OR COMPANY.
ANY INFORMATION EXCHANGED UNDER THIS AGREEMENT IS PROVIDED "AS IS."
4. IN NO EVENT SHALL A PARTY BE LIABLE TO THE OTHER PARTY, ITS CUSTOMERS,
OR ANY OTHER PERSON FOR INCIDENTAL, INDIRECT, SPECIAL CONSEQUENTIAL OR PUNITIVE
DAMAGES, INCLUDING WITHOUT LIMITATION LOSS OF USE, DELAYS, LOST PROFITS OR LOST
SAVINGS, ARISING OUT OF THE BREACH OF ANY WARRANTY OR OBLIGATION UNDER THIS
AGREEMENT OR THE USE OR INABILITY TO USE THE CODE, ATHENA OR ANY RELATED
DOCUMENTATION OR UPDATES, OR ANY PORTION THEREOF, WHETHER BASED ON CONTRACT OR
TORT (INCLUDING BUT NOT LIMITED TO STRICT LIABILITY, PRODUCT LIABILITY,
NEGLIGENCE, OR FOR INDEMNIFICATION OR RESULTING FROM THIS AGREEMENT OR ANYTHING
FURNISHED HEREUNDER), EVEN IF THE OTHER PARTY HAS BEEN ADVISED AS TO THE
POSSIBILITY OF SUCH DAMAGES.
F. Miscellaneous
-------------
19
1. Successors and Assigns. Without the prior consent of the other party,
neither party shall assign its rights or obligations under this Agreement;
provided, however, that Company may assign its rights and obligations under this
Agreement other than Sections B, C.2 and D.4(b) to single or multiple assignees
without ▇▇▇▇▇▇▇'▇ consent. Subject to the restrictions on transfer herein set
forth, this Agreement shall be binding upon and inure to the benefit of the
parties and their respective successors and permitted assigns.
2. Interpretation. Any dispute regarding the interpretation of this
Agreement shall be submitted by ▇▇▇▇▇▇▇ or by Company forthwith to Company's
Board of Directors which shall review such dispute at its next regular meeting.
The resolution of such a dispute by the Board shall be final and binding on
Company and on ▇▇▇▇▇▇▇.
3. Governing Law; Severability. This Agreement exclusively shall be
governed by and construed in accordance with the laws of the State of
Washington, excluding that body of law pertaining to conflicts of law. Should
any provision of this Agreement be determined by a court of law to be illegal or
unenforceable, the other provisions shall nevertheless remain effective and
shall remain enforceable.
4. Notices. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or four (4)
days following deposit in the United States mail by certified mail, with postage
and fees prepaid, addressed to the other party at its address as shown below
opposite its signature, or to such other address as such party may designate by
appropriate notice hereunder from time to time to the other party.
5. Further Instruments. The parties agree to execute such further
instruments and to take such further action as may be reasonably necessary to
carry out the purposes and intent of this Agreement.
6. Titles. The titles used in this Agreement are for convenience only and
are not to be considered in construing or interpreting this Agreement.
7. Independent Contractor. Company and ▇▇▇▇▇▇▇ are independent contractors
as to each other and at no time shall either party be deemed to be or hold
itself out as the employee, agent, partner or representative of the other party.
8. Entire Agreement. This Agreement constitutes the entire agreement of the
parties and supersedes in its entirety all prior undertakings and agreements of
Company and ▇▇▇▇▇▇▇ with respect to the subject matter hereof. To the extent
that any provision of this Agreement conflicts with any provision of the OEM
Agreement, this Agreement shall control and prevail.
20
9. Counterparts. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same agreement.
21
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
YESLER SOFTWARE, INC. Address:
-------
a Washington corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇. ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇
---------------------- --------------------------------
Its: President ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------- -------------------------
▇▇▇▇▇▇▇ Address:
-------
▇▇▇▇▇▇▇ Corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------- --------------------------------
Its: CTO
--------------------- --------------------------------
[Signature Page to ▇▇▇▇▇▇▇ Agreement]
EXHIBIT A
---------
ELECTION UNDER SECTION 83(b)
----------------------------
OF THE INTERNAL REVENUE CODE OF 1986
------------------------------------
The undersigned taxpayer hereby elects, pursuant to Section 83(b) of the
Internal Revenue Code of 1986, as amended, to include in its gross income for
the current taxable year, the amount of any compensation taxable to it in
connection with its receipt of the property described below:
1. The name, address, taxpayer identification number and taxable year of
the undersigned are as follows:
TAXPAYER SPOUSE
-------- ------
NAME: __________________ ______________________
ADDRESS: __________________ ______________________
__________________ ______________________
IDENTIFICATION NO: ____-___-_____ ____-___-_____
TAXABLE YEAR: Calendar Year 199__
2. The property with respect to which the election is made is described as
follows:
_______ shares of Common Stock of Company, a Washington corporation.
3. The date on which the property was transferred is: _______, 199__
4. The property is subject to the following restrictions:
Option to repurchase 605,060 shares at cost upon the occurrence of
certain events as specified in the Agreement. Repurchase option lapses
quarterly over a three (3) year period.
5. The fair market value at the time of transfer, determined without
regard to any restriction other than a restriction which by its terms will never
lapse, of such property is: $_________.
6. The amount (if any) paid for such property: __________ (in cash and
property).
The undersigned has submitted a copy of this statement in connection with the
undersigned's receipt of the above-described property.
The undersigned understands that the foregoing election may not be revoked
except with the consent of the Commissioner.
Dated: _____________________, 199__ ________________________________
Taxpayer
EXHIBIT B
---------
STOCK POWER AND ASSIGNMENT
--------------------------
SEPARATE FROM CERTIFICATE
-------------------------
FOR VALUE RECEIVED and pursuant to that certain Contribution and Restricted
Stock Purchase Agreement dated as of _______________, 1998, the undersigned
hereby sells, assigns and transfers unto __________________________, [ ]
(_______) shares of Common Stock of Yesler Software, Inc., a Washington
corporation, standing in the undersigned's name on the books of said corporation
represented by certificate number ______ delivered herewith, and does hereby
irrevocably constitute and appoint ________________ as attorney-in-fact, with
full power of substitution, to transfer said stock on the books of said
corporation.
Dated: ________________, 1998.
▇▇▇▇▇▇▇ CORPORATION
_______________ By:________________________
_______________ Its:_______________________
▇▇▇▇▇▇▇ Corporation
___________________________
_______________ (Please Print Name)
This Assignment Separate From Certificate was executed in conjunction with the
terms of a Contribution and Restricted Stock Purchase Agreement between the
above assignor and Company dated as of ________________, 1998.
Instruction: Please do not fill in any blanks other than the signature line.
EXHIBIT C
---------
JOINT ESCROW INSTRUCTIONS
-------------------------
_________________, 1998
▇▇▇▇▇ ▇. ▇▇▇▇▇
Certified Public Accountants
▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇. ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
As Escrow Agent for both Yesler Software, Inc., a Washington corporation
(the "Company"), and ▇▇▇▇▇▇▇ Corporation ("▇▇▇▇▇▇▇"), you are hereby authorized
and directed to hold the documents delivered to you pursuant to the terms of
that certain Contribution and Restricted Stock Purchase Agreement (the
"Agreement"), dated as of ____________, 1998, to which a copy of these Joint
Escrow Instructions is attached, in accordance with the following instructions:
1. In the event that Company and/or any permitted assignee of Company
(referred to collectively for convenience herein as the "Company") exercises its
Repurchase Option set forth in the Agreement, Company shall give to ▇▇▇▇▇▇▇ and
you a written notice specifying the number of shares of stock to be purchased,
the purchase price, and the time for a closing hereunder at the principal office
of Company. ▇▇▇▇▇▇▇ and Company hereby irrevocably authorize and direct you to
close the transaction contemplated by such notice in accordance with the terms
of said notice.
2. At the closing, you are directed (a) to date the stock assignments
necessary for the transfer in question, (b) to fill in the number of shares
being transferred, and (c) to deliver same, together with the certificate
evidencing the shares of stock to be transferred, to Company against the
simultaneous delivery to you of the purchase price (by check or such other form
of consideration mutually agreed to by the parties) for the number of shares of
stock being purchased pursuant to the exercise of the Repurchase Option.
3. ▇▇▇▇▇▇▇ irrevocably authorizes Company to deposit with you any
certificates evidencing shares of stock to be held by you hereunder and any
additions and substitutions to said shares as defined in the Agreement. ▇▇▇▇▇▇▇
does hereby irrevocably constitute and appoint you as its attorney-in-fact and
agent for the term of this escrow to execute with respect to such securities all
documents necessary or appropriate to make
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such securities negotiable and to complete any transaction herein contemplated.
Subject to the provisions of this paragraph 3, ▇▇▇▇▇▇▇ shall exercise all rights
and privileges of a shareholder of Company while the stock is held by you.
4. Upon written request of ▇▇▇▇▇▇▇ after each successive one-year period
from the date of the Agreement, unless the Repurchase Option has been exercised,
you will deliver to ▇▇▇▇▇▇▇ a certificate or certificates representing so many
shares of stock as are not the subject of the Repurchase Option. Ninety-One (91)
days after the applicable defined date as set forth in Section B.2 of the
Agreement, you will deliver to ▇▇▇▇▇▇▇ a certificate or certificates
representing the aggregate number of shares sold and issued pursuant to the
Agreement and not purchased by Company or its assignees pursuant to exercise of
the Repurchase Option.
5. If at the time of termination of this escrow you should have in your
possession any documents, securities, or other property belonging to ▇▇▇▇▇▇▇,
you shall deliver all of same to ▇▇▇▇▇▇▇ and shall be discharged of all further
obligations hereunder.
6. Your duties hereunder may be altered, amended, modified or revoked only
by a writing signed by all of the parties hereto.
7. You shall be obligated only for the performance of such duties as are
specifically set forth herein and may rely and shall be protected in relying or
refraining from acting on any instrument reasonably believed by you to be
genuine and to have been signed or presented by the proper party or parties. You
shall not be personally liable for any act you may do or omit to do hereunder as
Escrow Agent or as attorney-in-fact for ▇▇▇▇▇▇▇ while acting in good faith and
in the exercise of your own good judgment.
8. You are hereby expressly authorized to disregard any and all warnings
given by any of the parties hereto or by any other person or corporation,
excepting only orders or process of courts of law, and are hereby expressly
authorized to comply with and obey orders, judgments or decrees of any court. In
case you obey or comply with any such order, judgment or decree, you shall not
be liable to any of the parties hereto or to any other person, firm or
corporation by reason of such compliance, notwithstanding any such order,
judgment or decree being subsequently reversed, modified, annulled, set aside,
vacated or found to have been entered without jurisdiction.
9. You shall not be liable in any respect on account of the identity,
authorities or rights of the parties executing or delivering or purporting to
execute or deliver the Agreement or any documents or papers deposited or called
for hereunder.
10. You shall not be liable for the outlawing of any rights under the
statute of limitations with respect to these Joint Escrow Instructions or any
documents deposited with you.
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11. You shall be entitled to employ at the expense of Company such legal
counsel and other experts as you may deem necessary properly to advise you in
connection with your obligations hereunder and may rely upon the advice of such
counsel.
12. Your responsibilities as Escrow Agent hereunder shall terminate if you
shall resign by written notice to each party. In the event of any such
termination, Company shall appoint a successor Escrow Agent.
13. If you reasonably require other or further instruments in connection
with these Joint Escrow Instructions or obligations in respect hereto, the
necessary parties hereto shall join in furnishing such instruments.
14. It is understood and agreed that should any dispute arise with respect
to the delivery and/or ownership or right of possession of the securities held
by you hereunder, you are authorized and directed to retain in your possession
without liability to anyone all or any part of said securities until such
disputes shall have been settled either by mutual written agreement of the
parties concerned or by a final order, decree or judgment of a court of
competent jurisdiction after the time for appeal has expired and no appeal has
been perfected, but you shall be under no duty whatsoever to institute or defend
any such proceedings.
15. Any notice required or permitted hereunder shall be given in writing
and shall be deemed effectively given upon personal delivery or four (4) days
following deposit in any United States Post Office, by registered or certified
mail with postage and fees prepaid, addressed to each of the other parties
thereunto entitled at the following addresses, or at such other addresses as a
party may designate by written notice to each of the other parties hereto.
COMPANY: Yesler Software, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇: ▇▇▇▇▇▇▇ Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
ESCROW AGENT: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Certified Public Accountants
▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇. ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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16. By signing these Joint Escrow Instructions, you become a party hereto
only for the purpose of said Joint Escrow Instructions; you do not become a
party to the Agreement.
17. This instrument shall be binding upon and inure to the benefit of the
parties hereto, and their respective successors and permitted assigns.
Very truly yours,
YESLER SOFTWARE, INC., a Washington
corporation
By:________________________________
Title:_____________________________
▇▇▇▇▇▇▇:
▇▇▇▇▇▇▇ Corporation
By:________________________________
Its:_______________________________
ESCROW AGENT:
▇▇▇▇▇ ▇. ▇▇▇▇▇
_____________________________
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ATTACHMENT 1.1
--------------
▇▇▇▇▇▇▇ SOFTWARE
Cold Fusion Studio 3.1
Cold Fusion Application Server 3.1
Cold Fusion Studio 4.0, pre-release and release
Cold Fusion Application Server 4.0, pre-release and release
HomeSite 3.1
HomeSite 4.0, pre-release and release
5