EXHIBIT 10(A)
1. The Parties
The parties to this Agreement are:
827109 ALBERTA LTD., a corporation having its principal place of
business at ▇▇▇▇▇ ▇▇▇-▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, which
is referred to elsewhere in this Agreement as "the Licensor"; and
DELTA CAPITAL TECHNOLOGIES INC., A DELAWARE CORPORATION, having its
principal place of business at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ which is referred to elsewhere in this Agreement as "the
Licensee".
2. Purpose of the Agreement
The purpose of this Agreement is for the Licensor to license the
Licensee to use, market and distribute the Computer Program and Related
Materials in return for which the Licensee will pay the Consideration to the
Licensor.
3. Definitions
The parties agree that, in this Agreement, the following terms have the
following meanings.
ACCEPTANCE This Agreement is effective and accepted when the
conditions of the "Acceptance" section below are met.
ADDITIONAL TECHNICAL The services described in SCHEDULE 4.
SERVICES
AFFILIATE A company which has a majority of its voting shares
owned directly or indirectly by either the Licensee
or a company which directly or indirectly owns a
majority of the voting shares of the Licensee.
COMPUTER PROGRAM The computer program[s] listed in the Product
Specification delivered to the Licensee and each copy
of, update of or enhancement to such computer
program.
CONFIDENTIAL INFORMATION The information specified in the Product
Specification and the information provided by and
designated as confidential in writing by the Licensor
to the Licensee. Confidential Information does not
include information which is:
- publicly available or becomes so other than by acts
of the Licensee;
1
- received by the Licensee prior to it being provided
by the Licensor to the Licensee; or
- received by the Licensee from a third party.
DESIGNATED LOCATION Such address as may be designated by the Licensee and
agreed to in writing by the Licensor, such agreement
no to be unreasonably withheld.
NET SALES Sub-License sales less Sub-Licenses cost of goods
sold and direct sales, marketing and administrative
expenses related to the software subject to this
agreement.
PRODUCT SPECIFICATION The specification set out in SCHEDULE 1 to this
Agreement.
PERFORMANCE SPECIFICATION The specification set out in SCHEDULE 2 to this
Agreement.
RELATED MATERIALS The human-readable documentation which is to be
delivered with the Computer Program. The Related
Materials are specified in the Product Specification.
SERVICE SPECIFICATION The specification set out in SCHEDULE 3 to this
agreement.
SUBJECT MATTER The intellectual property right[s] or the subject of
other rights licensed under this Agreement namely:
- the copyright subsisting in a work entitled
relBuilder Enterprise Suite;
- the Confidential Information;
- all of the above as they are embodied in the
Computer Program and Related Materials
TERM The time period specified in the "Term" paragraph
below.
TERRITORY The geographic or economic market of the License,
namely: worldwide.
USE In respect of the Computer Program, use means the
execution of the Computer Program by a computer's
central processing unit(s) for processing the
instructions contained in the Computer Program.
4. License Grant
2
(1) For the Consideration described below, the Licensor hereby grants a License
to the Licensee under the Subject Matter to use, market and distribute the
Computer Program in the Territory for the Term of this Agreement, and to use,
market and distribute the Related Materials in association with such use,
marketing and distribution of the Computer Program, subject to the terms and
conditions of this Agreement.
(2) The License grant is exclusive and during the term and any renewals thereof
will not be offered to any other party.
(3) The Licensee may modify, or customize the Computer Program and Related
Materials. The Licensor is the owner of copyright in the modifications or
customizations. The Licensee shall provide copies of all modifications or
customizations to the Licensor.
(4) The License does not grant any ownership or security interest or title in
any intellectual property right relating to the Computer Program.
(5) The Licensee has the right to sub-license the use of the Computer Program
and Related Materials as specified in this paragraph.
(a) The Licensee may sub-license use of the Computer Program and
Related Materials to any party;
(b) Licensee agrees to sub-license only under the terms of Licensor's
"End-User Licensing Agreement", to be provided to Licensee by Licensor
within thirty (30) days upon request by Licensee.
(6) The License is transferable only under the conditions specified in the
"Assignability" section below.
5. Consideration
(1) The Licensee shall pay to the Licensor the Consideration of:
(a) a lump-sum License fee of $50,000.00 (CAD) payable within sixty
(60) days from the effective date of this Agreement. This payment shall
be non-refundable after Acceptance has occurred; and
(b) a Royalty as defined below;
(2) If the Consideration is not paid when due and upon demand by the Licensor,
the Licensee shall pay to the Licensor interest at the rate of the Bank of
Canada prime,
3
payable monthly. Interest on overdue interest is also payable at the same rate
until the amount due is paid.
(3) The Royalty shall be in the following amounts for the following periods,
calculated on the basis of 15% of Net Sales calculated monthly.
(4) The Licensee shall pay a royalty of at least $50,000.00 (CAD) by the end of
the first year of this Agreement; an additional $200,000.00 (CAD) by the end of
the second year of this Agreement; and an additional $300,000.00 (CAD) by the
end of the third year of this Agreement.
6. Obligations of the Licensor
The Licensor shall provide to the Licensee, within sixty (60) days of
the effective date of this Agreement taking effect:
(a) any reasonable number of copies of the Computer Program and Related
Materials as described in the Product Specification requested by the
Licensee; and
(b) training and technical assistance as described in the Service
Specification;
7. Obligations of the Licensee
(1) The Licensee shall not make any copies of the Computer Program or Related
Materials nor permit anyone else to use, have access to, or copy the Computer
Program or Related Materials other than those that are specifically authorized
to be made under this Agreement.
(2) Upon termination of this License, the Licensee shall return to the Licensor
or destroy under oath all copies of the Computer Program and Related Materials.
The Licensee shall erase all Computer Programs from any storage media before
disposal of such media. Within one month of the date of the termination of this
License, the Licensee shall notify the Licensor in writing of the Licensee's
compliance with the requirements of this section.
8. Acceptance
(1) Acceptance and effectiveness of this Agreement will have occurred upon
execution of this Agreement by authorized officers of the parties.
4
9. Defects
(1) Obligations of the Licensee
If the Computer Program fails to perform in accordance with the
Performance Specification, the Licensee shall promptly advise the Licensor of
the defect and shall assist the Licensor in identifying and fixing the defect.
(2) Obligations of the Licensor
If the Computer Program fails to perform in accordance with the
Performance Specification, and the Licensee promptly advises the Licensor of the
defect, then the Licensor shall, within 60 days of the communication of the
existence of the defect:
(a) correct the defect, or;
(b) identify the defect and provide a schedule to the Licensee for
correcting the defect.
10. Upgrades/Interim Maintenance Releases
The Licensor shall deliver to the Licensee:
(a) upgrade versions or new versions of the Computer Program and Related
Materials; and
(b) interim maintenance releases of the Computer Program and Related
Materials.
11. Term
(1) The term of the License is three (3) years beginning on the date this
Agreement takes effect.
(2) This License terminates thirty (30) days after the non-breaching party gives
notice to the breaching party of a material breach of a provision of this
Agreement, unless the breaching party has remedied the breach within that time.
(3) This License terminates automatically upon the occurrence of any of the
following events:
(a) The insolvency of the Licensee;
5
(b) The Licensee executes an assignment for the benefit of creditors;
(c) The Licensee ceases to carry on business;
(d) The Licensee becomes subject to receivership or bankruptcy
proceedings;
(e) The Licensee fails to make any prescribed royalty payments within
sixty (60) days of such royalty payments being due, provided that in the
event that the Licensee is terminated as set out herein, the Licensee
shall only be responsible for its pro-rata share of its annual royalty
payment
(4) The parties acknowledge that the Licensee has the right to retain,
access, copy and modify all data files containing Licensee's data used
or generated by the Computer Program.
(5) This agreement may be renewed upon expiration for an unlimited term for
the sum of one ($1.00) unless such period is limited by operation of
law.
12. Warranties
(1) The Licensor and Licensee warrant to each other as follows:
(a) Each corporate party is duly incorporated and subsisting under the
laws of its place of incorporation or subsistence.
(b) Each party has the power to and is authorized to enter into this
Agreement.
(c) The carrying out of this Agreement will not breach or interfere
with any other agreement to which the respective party has entered
into.
(d) Neither party will enter into another agreement the carrying out of
which would interfere with the carrying out of this Agreement;
(2) The Licensor warrants as follows:
(a) The Licensor has the right to license the Subject Matter free of any
liens or encumbrances. Any portions of the Computer Program and Related
Materials, the intellectual property of which are owned by someone other
than the Licensor, have been licensed to the Licensor for sub-licensing
to the Licensee and others. Such License does not restrict the ability
of the Licensor to grant the Licenses set out in this Agreement.
6
(b) The Licensor owns the right, title and interest in the physical
media provided to the Licensee under this Agreement.
(c) The Computer Program is of marketable quality.
(d) To the best of the Licensor's knowledge, the use of the Computer
Program does not infringe the intellectual property rights of others
nor is the Licensor aware of any allegations made that the use of the
Computer Program infringes the intellectual property rights of others.
(e) The Computer Program does not contain any programs which are
intended to permit unauthorized access, or cause damage to other
programs, data or hardware.
(3) The Licensee warrants that it shall keep the License of this Agreement
free of liens, claims and encumbrances.
(4) The above warranties are instead of any and all other warranties,
representations or conditions express or implied, oral or written with respect
to the Computer Program and Related Materials, including any implied warranties
or conditions of title, non-infringement, merchantability or fitness or
suitability for a particular purpose. The Licensor disclaims and the Licensee
waives all other such warranties, representations and conditions. Certain
jurisdictions do not permit such exclusion of warranties, so this disclaimer may
not apply to the Licensee.
13. Indemnification
(1) The Licensor shall indemnify the Licensee against all claims including
liabilities and legal costs and disbursements made against the Licensee alleging
that any use of the Computer Program or Related Materials constitutes
infringement of any copyright, patent, trade-▇▇▇▇, or trade secret rights.
(2) The Licensor shall have carriage of the defense of such claim made
against the Licensee and has the exclusive right to settle the claim so long as
the settlement does not interfere with the business arrangements of the
Licensee. The Licensee shall cooperate fully in the conduct of the defense. The
Licensee shall either retain the legal counsel designated by the Licensor or may
retain its own counsel at its own expense.
(3) The Licensee shall notify the Licensor as soon as possible upon any
claim being made against the Licensee that its use of the Computer Program is
alleged to be an infringement of the intellectual property rights of others.
(4) In the event that the Computer Program is finally held by a court of
competent jurisdiction, to be an infringement of the intellectual property
rights of another, then
7
the Licensor shall:
(a) modify the Computer Program to make it non-infringing; or
(b) obtain a License for use of the Computer Program from the
other party; or
(c) terminate the License and refund any payments the Licensee has
made.
14. Relief
(1) Injunctive Relief
Any unauthorized use of any intellectual property rights of the
Licensor made or caused by the Licensee will result in irreparable harm to the
Licensor which cannot be adequately compensated for by damages. The Licensor is
entitled to a court-ordered injunction in the event such use is made or caused
by the Licensee.
(2) Limitation of Damages
The Licensor shall not be liable to the Licensee for incidental,
special or consequential damages caused by the breach of any term or warranty of
this Agreement, including lost profits, lost data, loss of computer time or any
commercial or economic loss. The liability of the Licensor shall, in any event,
be limited to the total monies paid by the Licensee to the Licensor as the
Consideration for this Agreement. Certain jurisdictions do not permit such
exclusion of liability for consequential damages, so this disclaimer may not
apply to the Licensee.
15. Dispute Resolution
(1) Governing Law
This Agreement shall be interpreted under the laws of Alberta, Canada.
(2) Arbitration
Disputes, other than those for immediate cessation of conduct by a
party to this Agreement, shall be resolved under arbitration in accordance with
the Licensing Agreement Arbitration Rules of the American Arbitration
Association.
The Arbitration shall take place at a location agreed to by the parties
in the English language.
8
The costs of the arbitration shall be paid equally by the parties.
The decision of the arbitrator shall be binding on the parties and may
be entered in any Court having jurisdiction to do so.
16. Confidentiality
(1) The Licensee acknowledges that the Confidential Information is a trade
secret and is owned by the Licensor.
(2) The Licensee will take all reasonable precautions to maintain the
confidentiality of the Confidential Information and to prevent the unauthorized
disclosure to others of the Confidential Information. The Licensee shall not be
liable for damages caused to the Licensor by inadvertent breaches of
confidentiality.
(3) The Licensee shall only disclose the Confidential Information to those of
its employees who have a need to know and require access to the Confidential
Information to exploit the License. The Licensee shall require each employee who
receives the Confidential Information to agree in writing, prior to such
disclosure, to maintain the information as confidential.
17. Non-competition
The Licensee may develop computer software similar in function to the
Licensor's Computer Program. Those employees of the Licensee who develop such
computer software shall not have had access to the Licensor's Confidential
Information for a two-year period prior to commencing such development. Further,
the Licensor shall not be engaged in, develop software, or be a party to the
development, marketing or licensing of any software which could reasonably be
assumed to be in competition with the software that is the subject of this
agreement.
18. Reverse Engineering
The Licensee shall not reverse engineer, decompile or disassemble the
object code version of the Computer Program without the prior written approval
of the Licensor.
19. Assignability
(1) This License is assignable by the Licensee to another person or legal entity
only with the express prior written permission of the Licensor.
9
(2) This Agreement is binding on the parties to this Agreement, their successors
and assigns.
20. General Provisions
(1) This Agreement constitutes the entire agreement between the parties
concerning the Computer Program. The parties are not relying upon any earlier
representation which is not included in this Agreement.
(2) This Agreement cannot be amended or modified other than by a change made in
writing and executed by the parties.
(3) Covenants concerning intellectual property are to be construed as being
independent of other provisions in this Agreement.
(4) In the event that any portion of this Agreement is held by a court of
competent jurisdiction to be invalid or unenforceable, then the remaining
portions of the Agreement shall survive unaffected.
(5) Notice may be sent, by any means whatsoever, to the address specified at the
beginning of this Agreement or at such other address for notice which may be
given by notification of the other party in writing. Notice is effective on the
date that the notice is received. Notice by courier or registered mail is deemed
to be given on the date recorded as delivered. Notice by telecopy or Telex is
deemed to be made on the date and at the time it is sent and acknowledged as
being received.
(6) The waiver by any party of a breach of this Agreement does not constitute a
waiver of other breaches or rights under this Agreement.
(7) Delays or non-performance of any obligations under this Agreement caused by
events beyond the control of the party having the obligation, shall not be a
breach of this Agreement. The time for carrying out the obligation shall extend
for a period equal to the time over which the conditions existed.
(8) The headings in this Agreement are for reference purposes only and cannot be
used to construe the terms of the Agreement.
(9) This Agreement does not establish a joint venture or partnership between the
Licensor and Licensee.
(10) This Agreement shall be recorded in any and all offices where such recordal
is necessary under the laws of the respective country.
▇▇
▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, this _1___ day of
_____June____, _1999_.
Licensor
"▇▇▇▇ ▇▇▇▇▇"
---------------------------
By: ▇▇▇▇ ▇▇▇▇▇
Title: President
Licensee
"▇▇▇▇▇▇ ▇▇▇▇▇▇"
--------------------------
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Corporate Secretary
11
SCHEDULE 1
Product Specification
(1) The Computer Program to be delivered under this Agreement is a set of
instructions or statements expressed, fixed, embodied or stored in any manner,
that is to be used directly or indirectly in a computer in order to bring about
a specific result and has the following characteristics:
(a) Brand Name: relBuilder Enterprise Suite
(2) The Computer Program shall be in executable form.
(3) The Related Materials shall include:
(a) operation and user manuals
(b) instructions
(4) The Computer Program shall be in the form of:
(a) source code in a form which may be compiled or assembled to
executable code.
Confidential Information
(1) The following items are confidential and proprietary to the Licensor:
(a) the source code version of the Computer Program;
(b) the Computer Program system specification;
(c) the methods and concepts embodied in the Computer Program;
(d) the structure, sequence and organization of the Computer
Program.
(2) All written forms of the Confidential Information shall bear a conspicuous
notice identifying the subject matter as being Confidential Information. The
Licensee shall not remove such notice.
S-1
SCHEDULE 2
Performance Specification
(1) "as-documented"
(a) The Licensor warrants that the Computer Program will perform in
accordance with its description in its documentation on the computer
hardware and operating system specified in its documentation.
(b) The Licensor does not warrant that the Computer Program will operate
with any other Computer Program not so specified in the documentation.
(c) The only remedy of the Licensee under this warranty is the Licensee
may terminate the License. If the Licensee terminates the License under
this warranty, the Licensor shall pay to the Licensee 90% of the License
fee paid by the Licensee.
S-2
SCHEDULE 3
Service Specification
(1) Training
The Licensor shall train a reasonable number of employees of the
Licensee in the use and operation of the Computer Program.
(2) Technical Assistance
The Licensor shall provide the following technical assistance:
(a) Installation support; and
(b) Troubleshooting support.
(3) Maintenance
The Licensor shall maintain the Computer Program and Related Materials
in an operable form as described in the Product Specification and Performance
Specification.
S-3
SCHEDULE 4
Additional Technical Services
The Licensor shall provide the following technical services:
(a) Integration training for Licensee developers;
(b) Support for Licensee developers; and
(c) Architectural training for Licensee developers.
S-4