EXHIBIT 10.6
Technologies License, Development, Consulting and Collaboration
Agreement
Between
Auckland UniServices Limited, a New Zealand Company
and
Pacific Title/Mirage, Inc., a Delaware Corporation
Effective as of November 1, 1997
TABLE OF CONTENTS
SECTION 1 - DEFINITIONS........................................................... 3
1.1 Defined Terms......................................................... 3
1.2 Other Definitions..................................................... 7
SECTION 2 - LICENSE AGREEMENT..................................................... 8
2.1 Grant of License...................................................... 8
2.2 Sub-licensees......................................................... 9
2.3 UniServices Exclusion................................................. 9
2.4 dCMISS................................................................ 9
2.5 Escrow Access......................................................... 9
SECTION 3 - NON-REFUNDABLE LICENSE FEE............................................ 10
3.1 Basic Fee............................................................. 10
3.2 Taxes................................................................. 10
3.3 Development Fees...................................................... 11
SECTION 4 - DEVELOPMENT SERVICES,
CONSULTING SERVICES, FEES AND CERTAIN OTHER MATTERS .................. 11
4.1 Reasonable Efforts and Hunter Guarantee............................... 11
4.2 Development Services.................................................. 12
4.3 Intellectual Property Rights.......................................... 14
4.4 Consulting Services................................................... 16
4.5 Development Fee....................................................... 17
4.6 Joint Ownership of Certain Inventions and Intellectual Property
Rights, and Trade Secret Infringement and Enforcement Rights
Generally with Respect to the Licensed and Jointly Owned
Technologies.......................................................... 17
4.7 Additional Licenses................................................... 22
4.8 Pacific's Responsibility for its Products and Services................ 23
SECTION 5 - DELIVERABLES, ESCROW OF SOURCE CODES.................................. 24
5.1 Delivery.............................................................. 24
5.2 Escrow of Source Code................................................. 25
5.3 Source Code........................................................... 25
5.4 Deposit............................................................... 26
5.5 Default in Development Services....................................... 26
SECTION 6 - EXTENSION............................................................. 27
6.1 Extension of Development Services..................................... 27
6.2 Extension of Exclusivity.............................................. 28
6.3 Perpetual Extension of Exclusivity.................................... 28
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SECTION 7 - TERMINATION................................................... 28
7.1 Basic Fee Payment Default..................................... 28
7.2 Development Fee Payment Default............................... 29
7.3 Intellectual Property Rights.................................. 29
7.4 Pacific's Separate Technologies............................... 29
7.5 UniServices Separate Technologies............................. 30
SECTION 8 - WARRANTIES AND GENERAL PROVISIONS............................. 30
8.1 UniServices Warranties........................................ 30
8.2 Liability..................................................... 31
8.3 Indemnity..................................................... 31
8.4 Services of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇.................................. 32
8.5 No Reverse Engineering........................................ 33
SECTION 9 - ADDITIONAL PROVISIONS......................................... 33
9.1 Resolution of Disputes........................................ 33
9.2 Force Majeure................................................. 35
9.3 Agreement Disapproved or Unenforceable........................ 36
9.4 Proprietary and Confidential Information...................... 36
9.5 Patent Perfection, and Copyright Registration................. 37
9.6 Independent Contractors....................................... 38
9.7 Time is of the Essence........................................ 39
9.8 Counterparts.................................................. 39
9.9 Notice of License and use of UniServices Name................. 40
9.10 Non Solicitation.............................................. 40
9.11 Survival...................................................... 40
9.12 The Plan...................................................... 41
9.13 Government Requirements and Approvals and Certain Laws........ 41
9.14 Conflict with Applicable Law.................................. 42
9.15 Effectiveness Subject to Prior Approval or Registration....... 42
SECTION 10 - MISCELLANEOUS PROVISIONS..................................... 43
10.1 Waiver........................................................ 43
10.2 Applicable Law................................................ 43
10.3 Entire Agreement.............................................. 43
10.4 Amendment..................................................... 43
10.5 Non-assignment................................................ 44
10.6 Agreement Binding............................................. 44
10.7 Consent to Jurisdiction....................................... 44
10.8 Waiver of Trial By Jury....................................... 44
10.9 Headings...................................................... 44
10.10 Rules of Construction......................................... 45
10.11 Notices....................................................... 45
10.12 Remedies...................................................... 45
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Technologies License, Development, Consulting
and Collaboration Agreement
This Technologies License, Development, Consulting and Collaboration
Agreement (the "Agreement") is made effective as of November 1, 1997, by and
between Auckland UniServices Limited ("UniServices"), a New Zealand company with
its Registered Office at ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇,
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, and Pacific Title/Mirage, Inc., ("Pacific"), a Delaware
corporation having an office and place of business at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇
▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ of America.
Whereas, the University of Auckland (The "University") has a Research Group
("Research Group") with skills in writing computer software and developing
computer algorithms. The Research Group has developed certain universal finite
element analysis and numerical computation computer software which it has named
CMISS, and which may be used for a variety of purposes including, but not
limited to, anatomically accurate modelling of organs of the human anatomy. The
University has previously assigned all of its Intellectual Property Rights in
CMISS to UniServices, and the University has previously agreed to make the
Research Group's services available to third parties through UniServices. The
Deed of Assignment of Intellectual Property dated February 28, 1997, which is
between the University of Auckland and UniServices, which made such assignment,
and related correspondence, is attached hereto as Exhibit A. UniServices has
previously initiated development on and is continuing to develop a derivative
product of CMISS known as "CMISS/animation" which is a
customized version of CMISS and which is to be used for creating animated images
of all kinds and other Animation Applications (as defined herein).
Whereas, UniServices and Pacific intend to maintain their respective
objectives and interests under this mutual Agreement as close to being parallel
as reasonably possible, and to creatively work together to accomplish such
intent.
Whereas, UniServices is in the business of providing services and licensing
Intellectual Property Rights arising from research undertaken at the University.
UniServices is the owner of all Intellectual Property Rights, including all
copyright and trade secret rights relating to CMISS and to CMISS/animation
(except for those rights covered by the prior University of California at San
Diego software agreement, which is dated March 2, 1998, and is attached hereto
as Exhibit B), and UniServices has exclusive access to the Research Group for
commercial purposes. UniServices is interested in licensing CMISS/animation to
Pacific pursuant to this Agreement.
Whereas, UniServices also desires to undertake, and Pacific and its
Affiliates (as herein defined) may from time to time materially assist
UniServices in such undertaking, the management of the development of an
animation package, including enhanced or customized versions of CMISS/animation,
plus additional software for use in making animated films and for other media
technology Animation Applications.
Whereas, Pacific is in the business of providing subcontract products and
services for companies which make films, and in developing software for the
entertainment industry and for other Animation Applications. Pacific is
interested in working with UniServices to develop CMISS/animation for use in
making animated films and for other Animation Applications. Pacific also intends
to provide subcontract products and services to its customers who make and
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sell animated films, and for other Animation Applications and which consist of,
relate to or are derived from this animation package, and/or Pacific also
intends to market such animation package to the entertainment industry and for
other applications. Pacific also intends to make use of the skills, techniques
and services of the Research Group to develop CMISS/animation in order to be
able to provide such animation package for other Animation Applications.
Now, therefore, in consideration of the promises contained herein,
UniServices and Pacific hereby agree as follows:
SECTION 1 - DEFINITIONS
-----------------------
1.1 Defined Terms. The following terms shall have the following defined
-------------
meanings:
"Additional Field" shall mean all Animation Applications for use in any
----------------
field other than the Entertainment Field, but excluding professional medical,
engineering and scientific applications.
"Affiliate" shall mean as to any specified person, (a) any other person
---------
controlling, controlled by or under common control with such specified person,
(b) any officer, director or partner of such specified person, (c) any other
person of which such specified person is an officer, employee, agent, director,
shareholder or partner or (d) any member of the Family Group of such specified
person or of any individual who is an Affiliate of such specified person by
reason of clause (a) or (b) of this definition. The term "control," with respect
to any person, means possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of such person, whether
through the ownership of voting securities or
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a partnership interest, by contract or otherwise. "Family Group" shall mean, as
to any individual, such individual's spouse, ancestors, lineal descendants and
trusts or partnerships for the benefit of any of the foregoing, provided that
all the income beneficiaries and remainderman of any such trust or all partners
of any such partnership are such individual's spouse, ancestors or lineal
descendants and/or charitable tax-exempt organizations. Without limiting the
foregoing definitions, for purposes of this Agreement, Mirage Technologies
Limited Partnership, a Massachusetts Limited Partnership, and each of its
general partners and Safeguard Scientifics, Inc. shall be treated as Affiliates
of Pacific, and the Research Group and the University shall be treated as
Affiliates of UniSerivices.
"Animation Applications" shall mean creating, manipulating, scanning,
----------------------
recording, storing, playing, viewing, compressing, decompressing, and
transmitting animated images, moving human images, moving organic, inorganic or
imaginary images, graphics, any graphic use of images, and visual simulations,
in, on, or across any medium now existing or which may be developed in the
future, including video tape, computer disks, CD, internet, computer networks,
telephone, cable, satellite, wireless networks and other media.
"CMISS" shall mean all versions of the computer software package and
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related technologies which the Research Group has developed for universal
finite element and other numerical analysis techniques for purposes including,
but not limited to, simulation and anatomically accurate modelling of organs
of the human body and other subjects, all enhancements, extensions and/or
Derivative Works of such computer software (except for dCMISS, a software
package developed by the University of California at San Diego (herein
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"UCSD") and which includes some elements of an early version of CMISS, as
licensed by UniServices to UCSD pursuant to the attached Exhibit B).
"CMISS/animation" shall mean the customized CMISS executable object code
---------------
computer software package (including all enhancements, extensions and/or
Derivative Works) which contains a subset of CMISS designed specifically for
Animation Applications in the Entertainment Field and which may also be used in
the Additional Field.
"Command Files" shall mean, in applications, a set of instructions which is
-------------
recorded and saved as a text file and can be executed with a single command.
When the Command File is executed, the program carries out the instructions.
Program users create Command Files to save time by replacing often-used, and
sometimes lengthy series of commands with a single command.
"Derivative Work" and/or "derivative" and/or "derivative work" or "works"
---------------
shall mean: (i) for copyrightable or copyrighted material, any modification,
correction, addition, extension, upgrade, improvement, compilation, abridgement,
or other form in which an existing work may be recast, transformed, or adapted;
(ii) for patentable or patented material, any improvement thereon; and (iii) for
material which is protected by trade secret, or copyright rights, any new
material derived from such existing trade secret or copyright material, and
including new material which may be protected by copyright, patent, and/or trade
secret or confidentiality agreements or covenants.
"Development Services" shall mean the services described in Section 4
--------------------
hereof, other than the Consulting Services defined in Section 4.4 hereof, and
which are to be performed by
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UniServices and the University's Research Group, as provided herein, or are to
be performed jointly by either such parties pursuant to this Agreement and with
Pacific or any of its Affiliates.
"Enhancement" or "enhancement" shall mean the addition of functionalities,
----------------------------
functional attributes, or interface means to CMISS/animation or other software
package subject to this Agreement and which did not previously exist.
"Entertainment Field" shall mean: (1) Film Making, and (2) Animation
-------------------
Applications for use in the entertainment field, but excluding professional
medical, engineering and scientific applications.
"Film Making" shall mean recording sequences of pictures or images and/or
-----------
sound and/or information or data which may be read or observed or heard on film,
video tape or any other media.
"Intellectual Property Rights" or "Intellectual Property Ownership Rights"
---------------------------- --------------------------------------
shall mean the copyright, patent, trade secret, or other confidential software
package or other data or technologies or other items placed under development or
developed pursuant to this Agreement, and including any Source Code or
executable object code, and all Enhancements, extensions and Derivative Works
thereof, and whether related to then pending or subsequently filed patent and/or
copyright or other applications, continuations in part, reissues, adaptations,
modifications, or other valuable or invaluable technology developed hereunder
for the Entertainment Field or for the Additional Field.
"Jointly Owned Inventions and/or Jointly Owned Intellectual Property
-------------------------------------------------------------------
Rights" shall mean all enhancements, extensions and/or Derivative Works of
------
CMISS/animation or any other software package developed hereunder to the extent
Pacific or any of its Affiliates has made a
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joint and material contribution to the Development Services performed by
UniServices or its Affiliates for the applicable executable object code
computer software package or other significant technological component of such
software package (excluding CMISS, CMISS/animation and dCMISS, which was
previously licensed by UniServices to UCSD). The payment by Pacific to
UniServices of Development Fees pursuant to this Agreement shall not by itself
alone constitute a joint and material contribution to such Development Services.
To avoid any misunderstandings, CMISS and CMISS/animation shall never be
considered "Jointly Owned Inventions and/or Jointly Owned Intellectual Property
Rights" because they are now owned and are in the future to be owned solely by
UniServices.
"Person" or "person" shall mean corporations, trusts, partnerships, whether
------ ------
limited or general, limited liability companies, individuals and other entities
or organizations of every kind whatsoever, and without limitation.
"Research Group" shall mean the Research Group at The University of
--------------
Auckland currently headed by Professor ▇▇▇▇▇ ▇▇▇▇▇▇ and currently comprising a
total of approximately 10 persons including ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, Dr. ▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and their graduate students, post doctoral fellows and
programmers within the Department of Engineering Science at The University of
Auckland, ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇ and its membership as it may
change from time to time.
1.2 Other Definitions. Other words and phrases may be defined elsewhere in
-----------------
this Agreement, either by quotation marks within a parentheses, such as, for
example, the phrase Initial Term in Section 4.1 hereof, or by reference to their
context or usage within this Agreement and its Exhibits, or by reference to the
latest edition of ▇▇▇▇▇▇▇'▇ Dictionary
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SECTION 2 - LICENSE AGREEMENT
-----------------------------
2.1 Grant of License. Subject to the terms and conditions of this
----------------
Agreement, UniServices grants to Pacific a universe wide, without geographic
limitation, as the universe is now known or as it may be hereafter discovered,
royalty-free license, but limited to the Entertainment Field and the Additional
Field, to use, make, have made, employ, import, export, and exploit in any other
commercially reasonable manner to its full commercial potential, and to
reproduce, [adapt, modify,] distribute, perform, and display CMISS/animation,
and to grant to sub-licensees the limited right to use CMISS/animation within
the Entertainment Field and/or within the Additional Field in accordance with
the terms and conditions of this Agreement. This license shall be exclusive and
in perpetuity for the Entertainment Field, and shall be exclusive for a period
of five years for the Additional Field, subject to the extension of such
exclusivity period as provided in Section 6 hereof. The licenses granted herein
to Pacific from UniServices do not transfer ownership to Pacific in any
Intellectual Property Rights in dCMISS, CMISS or CMISS/animation (including any
enhancements, extensions and/or Derivative Works thereof.) In addition, the
licenses granted herein to Pacific from UniServices do not provide Pacific with
any ownership or access to the Source Code of dCMISS, CMISS, or CMISS/animation
(including any enhancements, extensions and/or Derivative Works thereof),
except, as to access and use only pursuant to the terms and conditions hereof
and of such Escrow Agreement -- but not as to ownership, to the extent of the
release thereof from the Preferred Escrow Agreement pursuant to the terms and
conditions hereof and of such Escrow Agreement.
Pacific shall provide a detailed annual written notice to UniServices
during the month of November of each year and commencing in November 1998, as to
all sublicenses then in effect
8
for CMISS/animation with Pacific's customers, or other third parties, and which
notice shall provide the term of each sublicense, and the name, address,
telephone and facsimile numbers of the parties thereto, and such other
information as Pacific may reasonably determine from time to time.
The words [adapt, modify] as used in this Agreement are in brackets since
such words would apply hereunder only if the Source Code is released from escrow
pursuant to this Agreement since at that time the adaption and modification
rights may be needed by Pacific for copyright purposes.
2.2 Sub-licensees. Pacific agrees that any sub-license it grants to any
-------------
third party pursuant to this Agreement shall be subject to the terms and
conditions of this Agreement.
2.3 UniServices Exclusion. Unless terminated pursuant to Section 7
---------------------
hereof, UniServices shall not license or make use of dCMISS, CMISS, or
CMISS/animation or any Enhancement or Derivative Work of any thereof for the
Entertainment Field in perpetuity, or for the Additional Field so long as the
license granted herein is maintained pursuant hereto as an exclusive license in
the Additional Field.
2.4 dCMISS. UniServices agrees and covenants that the use of
------
CMISS/animation by Pacific and its sublicensees will not infringe on any rights
of UCSD in dCMISS, and will not require any royalty, fee or other amount to be
paid to UCSD, or its successors or assigns, and UniServices hereby indemnifies
and holds Pacific harmless from any loss or damage it may incur in such regard
as the result of the breach of this covenant.
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2.5 Escrow Access. Pacific agrees and covenants that no sublicensee of
-------------
Pacific shall obtain access, whether directly or indirectly, to the Source Codes
which are held in escrow pursuant to Exhibit C of this Agreement.
SECTION 3 - NON-REFUNDABLE LICENSE FEE
--------------------------------------
3.1 Basic Fee. Pacific agrees to pay UniServices a non-refundable license
---------
fee (herein the "Basic Fee") of One Million Dollars ($1,000,000.00) in US
currency in installments, as follows:
a) Eighty-Seven Thousand Five Hundred Dollars ($87,500) upon signing
this Agreement;
b) an additional total of seven (7) payments of Eighty-Seven
Thousand Five Hundred Dollars ($87,500) each, the first such
payment to be due and payable on or before January 31, 1998, and
each additional such payment to be due and payable at the end of
each subsequent quarter annual period through to and including
July 31, 1999; and
c) an additional four payments of Seventy-Five Thousand Dollars
($75,000) each, the first such payment to be due and payable on
October 31, 1999, and at the end of each subsequent quarter
annual period thereafter through to and including July 31, 2000.
3.2 Taxes. To the extent required by then Applicable Law, and from time
-----
to time, Pacific shall be responsible for withholding and forwarding to the
relevant taxing authorities located within the United States of America, on
behalf of UniServices, any local, state and
10
federal taxes imposed by any Federal, State or local United States taxing
authority in connection with this Agreement and the payments to be made to
UniServices hereunder. UniServices is solely responsible for the payment of all
its income taxes, if any, arising in connection with this Agreement, and its
receipt of the payments or its right to receive the payments to be made to
UniServices hereunder, and any local sales taxes, license or rental taxes, if
any, attributable to this Agreement or the payments to be made hereunder by
Pacific shall be paid by Pacific, and not by UniServices.
3.3 Development Fees. This Basic Fee does not include any payments to be
----------------
made by Pacific to UniServices for Development Services described in Section 4
or for additional Development Services, if any, requested from time to time by
Pacific.
SECTION 4 - DEVELOPMENT SERVICES,
---------------------------------
CONSULTING SERVICES, FEES AND CERTAIN OTHER MATTERS
---------------------------------------------------
4.1 Reasonable Efforts and Hunter Guarantee. UniServices agrees to obtain
---------------------------------------
and to use the reasonable efforts of the Research Group for a period of five
years (through October 31, 2002) (herein the "Initial Term") to substantially
develop CMISS/animation and to substantially develop enhanced and/or extended
versions and/or Derivative Works of CMISS/animation to meet Pacific's reasonable
requirements within the Entertainment Field and within the Additional Field, as
requested from time to time by Pacific, and whether pursuant to a Plan or
otherwise, and UniServices and the Research Group shall use their reasonable
efforts to provide to Pacific maintenance and support for CMISS/animation, as
requested from time to time by Pacific. UniServices further agrees to and does
hereby guarantee, as long as reasonably practicable, the availability of
Professor ▇▇▇▇▇ ▇▇▇▇▇▇ to provide supervision and direct control for all
11
Development Services to be provided by the Research Group pursuant to this
Agreement. UniServices further agrees to incorporate all future enhancements
made in CMISS into CMISS/animation to the extent needed or useful for
CMISS/animation.
4.2 Development Services.
--------------------
a. Each party may designate a Development Coordinator, which
designation may be changed by either party more than once, by
notice to the other party. The Development Coordinators may
prepare one or more Development Plans (the "Plans") from time to
time, which may include required specifications for
CMISS/animation enhancements and/or extended versions and/or
Derivative Works, as described herein. The Plan may also include,
if the parties reach such an agreement at such time, whether
Pacific is to provide a material contribution to such Development
Services, and it may specify the nature and extent of such
material contribution, and as a result of accomplishing such work
Pacific will become a Joint Owner of such Inventions or
Intellectual Property Rights created hereunder. The parties may,
however, proceed hereunder in the absence of such an
understanding, and reserve the question of such joint ownership
for future resolution. Once approved by both parties, a Plan may
only be changed with the written approval of both parties
respective Development Coordinators, or in the event of their
failure to agree, by the written agreement of an officer of both
parties. In the event of the failure of such officers to reach an
agreement for a Plan as above provided within
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a period of 60 days from the date of either party's first written
communication concerning the subject of a Plan, then either party may, if
it so chooses, submit the unagreed to terms of the Plan to mediation for
resolution, and as further provided in this Agreement.
b. The parties shall use reasonably diligent efforts to carry out their
respective obligations set forth in the Plan, or as otherwise established
hereunder, and in accordance with the Plan's timetable, if such a timetable
has been established by the parties. The parties hereto agree to use their
reasonable efforts to agree on and establish an appropriate and equitable
and fair timetable if one is needed hereunder.
c. Each party shall maintain reasonably detailed records to document the
Development Services performed and the work generated by the execution of
the Plan and any other Development Services performed or work produced
under this Agreement. Such records shall include, at a minimum, monthly
copies of archival in progress Source Codes, the names of all personnel
participating in each activity involving Development Services, a complete
list of all third party materials, such as, for example, compiler
computerized libraries used in developing such enhanced software, and
including copies of any signed license agreements authorizing the use of
such materials. Pacific shall have the right to inspect UniServices records
at reasonable times in the reasonable course of business upon at least one
week's prior notice.
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d. Each party shall notify the other party promptly after becoming aware
of any potential significant delay in the performance of the
Development Services and work accomplishment schedule under the Plan,
or in the work schedule as established from time to time by the
parties in the absence of such Plan. Any doubt with respect to whether
a delay will be significant shall be resolved in favor of giving such
notification.
e. Each party shall promptly respond to all inquiries made by the other
party's Development Coordinator which could be reasonably expected to
delay the Development Services or work accomplishment schedule.
f. The Plan shall specify the means by which each party shall carry out
its respective obligations regarding the confidentiality of the other
party's pre-existing works, any enhancements thereof, Derivative
Works, any trade secrets, and any other designated confidential
information.
g. Notwithstanding anything to the contrary contained in this Section
4.2, in the event the parties to this Agreement proceed with
Development Services without the establishment of a formal Plan or
work accomplishment schedule, UniServices shall be obligated to use
its reasonable efforts to perform Development Services and other work
hereunder of substantially equivalent value to the payments to be made
by Pacific hereunder for such Development Services.
4.3 Intellectual Property Rights. Other than any Jointly Owned Inventions
----------------------------
and/or Jointly Owned Intellectual Property Rights developed hereunder,
UniServices owns all
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copyright, trade secret, patent rights, if any, and other Intellectual Property
Rights in CMISS and any of its enhancements, extensions or Derivative Works,
including CMISS/animation, but excluding dCMISS, as provided in the UCSD
Agreement attached hereto as Exhibit B. Pacific acknowledges and agrees that
dCMISS (to the extent provided in the UCSD Agreement), CMISS and CMISS/animation
are presently trade secrets of and owned by UniServices, and that UniServices
has not previously sought any patent rights for such Intellectual Property
Rights by filing any patent application with respect thereto, although it may in
its discretion do so in the future. UniServices further agrees to use its
reasonable efforts to protect its Intellectual Property Rights in dCMISS (to the
extent provided in the UCSD Agreement), CMISS, CMISS/animation (including any
enhancements, extensions or Derivative Works) and any Jointly Owned Inventions
and/or Jointly Owned Intellectual Property Rights, and the confidentiality of
such trade secrets pursuant to the terms and conditions of this Agreement, from
any unauthorized or improper disclosure to third parties. Pacific is exclusively
licensed under all such Intellectual Property Rights, as provided in this
Agreement and subject to the exclusions and other terms and conditions hereof,
as if all such Intellectual Property Rights originally existed as of the date
this Agreement was entered into by the parties hereto. Inventions or
Intellectual Property made jointly by Pacific or any of its Affiliates and
UniServices or any of its Affiliates pursuant to this Agreement will be jointly
owned by both companies, subject to the terms and conditions hereof. With
respect to any Jointly Owned Inventions and/or Jointly Owned Intellectual
Property Rights, without otherwise limiting the application of any other
provision of this Agreement, the provisions of Section 4.6 hereof shall apply to
such Jointly Owned Inventions and/or Jointly Owned Intellectual Property Rights.
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In the event of any dispute regarding the Ownership of any Intellectual
Property Rights which arises hereunder, the parties agree to resolve such matter
themselves, or in the event of their inability to agree, by mediation pursuant
to this agreement, and in the event of their further failure to agree through
mediation, by arbitration pursuant to the terms of this Agreement. After
resolution of the ownership question for such Intellectual Property Rights, each
party agrees to subsequently cross license the other party hereto or its
Affiliates on commercially reasonable terms with respect to the previously
disputed Inventions or Intellectual Property Rights so that neither party is
denied the ability to use, make, have made, employ, import, export, and to
reproduce [adapt, modify] distribute, perform, display, sell and sublicense such
Intellectual Property Rights, regardless of the outcome of the ownership
question, pursuant to the terms and conditions of this Agreement. Commercially
reasonable terms for such cross license may include confidentiality undertakings
concerning any such Intellectual Property Rights which are trade secrets or are
otherwise maintained in confidence pursuant to confidentiality agreements or
covenants. The provisions of Section 4.6d. hereof, and which applies with
respect to the licensed technologies hereunder and the Jointly Owned Inventions
and/or Jointly Owned Intellectual Property Rights developed hereunder, shall
also apply to the above referenced cross license between the parties hereto with
respect to any third party infringement claim, and shall further apply with
respect to the legal remedies available to the parties hereto under such cross
license, and the other matters provided therein. All rights in images, graphics,
animations, etc. produced by or for Pacific or its sublicensees and using
CMISS/animation or any Enhancement or Derivative Work thereof shall be the sole
and exclusive property of Pacific or its sublicensees, and UniServices shall
have no rights therein.
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4.4 Consulting Services. During the Initial Term, and during any extended
-------------------
term or terms implemented pursuant to Section 6.1 hereof, and during any further
term or terms to which the parties hereto agree in writing in consideration of
an additional reasonable fee to be paid by Pacific to UniServices for such
further Consulting Services, UniServices will provide reasonable Consulting
Services to Pacific and its Affiliates, and will provide support and advice to
Pacific for CMISS/animation, and UniServices will manage the ongoing technical
development of CMISS/animation and its Enhancements and Derivative Works to the
extent that UniServices has available skills and resources to do so. Pacific
agrees to pay UniServices' travel and accommodation expenses if Pacific requires
advice or consultation from UniServices personnel which reasonably requires them
to temporarily travel outside of New Zealand.
4.5 Development Fee. As payment for the development, maintenance, support,
---------------
and consulting services described in this Section 4 for the Initial Term,
Pacific shall pay to UniServices a fee (the "Development Fee") of $150,000 per
year in U.S. dollars for five years, payable monthly in advance, with the first
payment due on November 1, 1997, and subsequent monthly payments to be paid on
the first day of each monthly period thereafter until a total of sixty payments
have been made in the amount of $12,500 each, for a total amount of Seven
Hundred Fifty Thousand U.S. Dollars ($750,000).
4.6 Joint Ownership of Certain Inventions and Intellectual Property
---------------------------------------------------------------
Rights, and Trade Secret Infringement and Enforcement Rights Generally with
---------------------------------------------------------------------------
Respect to the Licensed and Jointly Owned Technologies.
------------------------------------------------------
a. If there is any active or alleged infringement or trade secret
violation by any third party of the technologies licensed hereunder,
and if such matter comes to the
17
attention of either party to this Agreement, such party shall promptly
notify the other party and concurrently provide such evidence as either
such party may then have in its possession or have access to and concerning
the nature and extent of the alleged infringement or violations.
b. Pacific shall have the obligation to reasonably enforce the licensed
technology within the Entertainment Field and within the Additional Field.
If Pacific decides to institute an action, it shall provide 30 days prior
written notice to UniServices and UniServices may, within such 30 days,
elect to join in the action as a plaintiff, and at its own expense. If
UniServices elects not to voluntarily join in the action as a plaintiff,
then UniServices agrees to cooperate with Pacific to the extent reasonably
necessary, including being named as a plaintiff, and Pacific shall
reimburse UniServices for its out-of-pocket expenses in connection with any
such cooperative legal activities. In either event, Pacific shall retain
all proceeds, recoveries or settlements received from any such action, but
shall not enter into any settlement, consent judgment, or other voluntary
final disposition of any such proceeding, and which may include cross
licenses or other licenses, without the written consent of UniServices,
which consent may not be unreasonably withheld or delayed. If Pacific
decides not to enforce the licensed technologies or if it shall decide to
abandon or terminate any such previously initiated legal action, it shall
provide prompt written notice of such decision to UniServices, and
UniServices shall have the right to institute or to continue, to the extent
legally permissible, any such legal action. Pacific shall cooperate with
UniServices in
18
connection with any such matter to the extent reasonably necessary,
including being named as a plaintiff, and UniServices shall reimburse
Pacific for its out-of-pocket expenses in connection therewith. In
either event, UniServices shall retain all proceeds, recoveries or
settlements received from any such action, but shall not enter into
any settlement, consent judgment, or other voluntary final disposition
of any such proceeding, and which may include cross licenses or other
licenses, without the written consent of Pacific, which consent may
not be unreasonably withheld or delayed.
c. UniServices shall have the obligation to reasonably enforce the
licensed technology outside the scope of the Entertainment Field and
outside the Additional Field. If UniServices decides to institute an
action for any alleged trade secret violation or infringement, it
shall provide 30 days prior written notice to Pacific and Pacific may,
within such 30 days, elect to join in the action as a plaintiff, then
Pacific may, within such 30 days, elect to join in the action as a
plaintiff, and at its own expense. If Pacific elects not to
voluntarily join as a plaintiff, then Pacific agrees to cooperate with
UniServices to the extent reasonably necessary, including being named
as a plaintiff, and UniServices shall reimburse Pacific for its
out-of-pocket expenses in connection with any such cooperative legal
activities. In either event, UniServices shall retain all proceeds,
recoveries or settlements from any such action, but shall not enter
into any settlement, consent judgment, or other voluntary final
disposition of any such proceeding without the written consent of
Pacific, which consent may not be unreasonably withheld or delayed. If
UniServices decides not to enforce the licensed technologies, or if it
shall
19
decide to abandon or terminate any such previously initiated
action, it shall provide prompt written notice of such decision
to Pacific, and Pacific shall have the right to institute or to
continue, to the extent legally permissible, any such legal
action at its own expense, and Pacific shall retain all proceeds,
recoveries or settlements from any such legal action.
UniServices shall cooperate with Pacific in connection with any
such matter to the extent reasonably necessary, including being
named as a plaintiff, and Pacific shall reimburse UniServices for
its out-of-pocket expenses in connection therewith. In either
event, Pacific shall retain all proceeds, recoveries or
settlements from any such action, but shall not enter into any
settlement, consent judgement, or other voluntary final
disposition of any such proceeding, and which may include cross
licenses or other licenses, without the written consent of
UniServices, which consent may not be unreasonably withheld or
delayed.
d. For any alleged infringement or other trade secret violation of
the technologies licensed hereunder, and which has occurred both
within and outside the Entertainment and/or the Additional Field,
or any alleged infringement or other trade secret violation, and
regardless of whether within or outside such Fields, of the
Jointly Owned Inventions and/or Jointly Owned Intellectual
Property Rights developed or held hereunder, UniServices and
Pacific shall both have the right and obligation to reasonably
enforce the licensed technology. In such event, the parties shall
agree on the methods to be employed by them to accomplish such
enforcement objective, and on an appropriate and equitable
allocation of the
20
expenses and of any proceeds, recoveries or settlements of any such
enforcement action.
e. In the absence of a subsequent authorized and signed written
agreement between the parties hereto and relating to the subject
matter of Jointly Owned Inventions and/or Jointly Owned Intellectual
Property Rights held or developed pursuant to the terms and conditions
of this Agreement, the parties hereto agree to divide all benefits and
burdens of ownership with respect to all Jointly Owned Inventions
and/or Jointly Owned Intellectual Property Rights, based on a 50%
allocation of the benefits and burdens thereof to each of UniServices
and Pacific, and solely as Joint Owners who are independent
contractors, and are not partners, but subject to the terms and
conditions of this Agreement, including the right to initiate
mediation and/or subsequent arbitration proceedings hereunder in the
event of their failure to agree on any other ownership allocation or
other such matter requested by either such party.
f. With respect to any Jointly Owned Inventions and/or Jointly Owned
Intellectual Property Rights which are then maintained in confidence
as a trade secret, if either owner, or its successors or assigns in
interest, decides to patent and thereby materially disclose such
technology to the public, or to otherwise publish and materially make
public such confidential or trade secret information, including by way
of any copyright registration or copyright filing which requires a
material public disclosure of previously confidential trade secret
information, each party agrees to provide a veto power to the other
joint owner with respect to the
21
implementation of its decision to file such patent application, or
such copyright registration, or to otherwise materially make public
such confidential or trade secret information. Each party agrees to
strictly follow and comply with the written directions of the other
party hereto in such regards, and to take no such action to publicly
disclose any such trade secrets so that they are no longer maintained
as a trade secret, and each party hereby consents to a restraining
order or to an injunction, which may be sought by the other party in
order to prevent such public disclosure, and each party agrees that
damages would not constitute an adequate remedy at law due to the
irreparable harm which may result from any such wrongful public
disclosure.
4.7 Additional Licenses. Pacific acknowledges and agrees that Enhancements
-------------------
in CMISS made by UniServices may be licensed or otherwise used by UniServices
for applications outside the Entertainment Field and outside the Additional
Field. UniServices further acknowledges and agrees that the Command Files
existing as of June 1, 1998 and any trade secrets or related technologies or
confidential information pertaining thereto (excluding the implementation of the
SVD Algorithm into CMISS, all of which are solely owned by UniServices) are
owned by Pacific, and Pacific, as assignee thereof, to the best of UniServices'
belief and knowledge, but without having conducted an independent investigation,
and concerning which investigation Pacific agrees that UniServices was not under
a duty to conduct such an investigation prior to entering into this Agreement,
now owns the United States patent applications previously filed for such
technologies, and UniServices now has no known claim or adverse interest with
respect to such Intellectual Property Rights, including any copyright rights
22
or registrations, patent applications, amendments thereto, continuous thereof,
and extensions, Enhancements, and Derivative Works deriving therefrom. If for
any reason any Enhancement or Derivative Work of the Command Files or any
material portion of them are subsequently found to materially infringe on or to
otherwise violate UniServices' Intellectual Property Rights in dCMISS, CMISS,
CMISS/animation, or to materially infringe on or to otherwise violate any other
subsequently developed enhanced or derivative version of CMISS, or to be in
material breach of this Section 4.7, or to be in material breach of any other
material provision of this Agreement, then the parties hereto agree to execute
an amendment to this Agreement and/or to provide for a royalty free and
compensation free cross license between Pacific and UniServices, or their
respective Affiliates, on commercially reasonable terms with respect to such
technology and Intellectual Property Rights, and which cross license may include
trade secret and confidentiality covenants and other reasonable provisions, and
which cross license and this provision to enter into an amendment hereto and/or
such cross license shall in particular be subject to the provisions of Section
9.1 hereof.
With respect to this Section 4.7 and its interpretation, the parties hereto
further agree that CMISS is a low level Code, and that it has been developed by
UniServices and it is owned solely by UniServices, and that to the extent CMISS
is developed or created as a Command File using CMISS as a language, if such
Command File is created or developed solely by Pacific, then such Command File
shall be owned by Pacific, and if it is created or developed jointly by
UniServices and Pacific, it shall be owned jointly by UniServices and Pacific,
and if it is created or developed solely by UniServices, it shall be owned
solely by UniServices, subject to the terms and conditions of this Agreement.
23
4.8 Pacific's Responsibility for its Products and Services. This Agreement
------------------------------------------------------
is a Technologies License, Development, Consulting and Collaboration Agreement,
and which includes the obligation of UniServices to provide via license to
Pacific certain Intellectual Property Rights or know how or other confidential
information or trade secrets which UniServices may now own or may hereafter have
legal access to for the benefit of Pacific, in accordance with the objectives of
this Agreement. To the extent permitted in this Agreement, it shall be the
responsibility of Pacific to incorporate such information into its own services
and products in whatever manner Pacific may select, and UniServices shall have
no obligation to Pacific or to its customers with regard to the design,
performance, implementation, safety, manufacture, license, use or sale of such
Intellectual Property Rights or know how or other confidential information as
has then been included by Pacific in its services and products beyond the
specific representations, warranties, covenants, agreements and other provisions
provided herein.
SECTION 5 - DELIVERABLES, ESCROW OF SOURCE CODES
------------------------------------------------
5.1 Delivery. Upon execution of this Agreement, UniServices will deliver
--------
(i) the then most current version of CMISS/animation in executable object code
form to Pacific, with any currently existing documentation describing how to use
CMISS/animation, and (ii) the most current version of CMISS/animation in Source
Code form to the escrow agent pursuant to the Preferred Escrow Agreement, which
is attached hereto as Exhibit C, along with any currently existing documentation
describing how to compile CMISS/animation. UniServices agrees to update the
CMISS/animation Source Code quarterly by providing new Source Code updates and
24
versions and other information to the escrow agent in verifiable form, with
appropriate documentation regarding how to compile CMISS/animation, and as more
particularly described in Exhibit C hereto. The escrow agent's fees for its
services shall be paid by Pacific.
5.2 Escrow of Source Code. In order to protect Pacific and Pacific's
---------------------
partial investment in CMISS/animation, UniServices agrees to place the Source
Code in escrow for the benefit of Pacific. To accomplish this escrow
arrangement, UniServices and Pacific agree to execute and be bound by, effective
as of June 1, 1998, the Preferred Escrow Agreement attached hereto and expressly
incorporated herein by reference as Exhibit C, between Data Securities
International, Inc. ("DSI"), UniServices, and Pacific.
5.3 Source Code. For purposes of UniServices' escrow obligations, the term
-----------
"Source Code" shall mean a copy of the Source Code corresponding to
CMISS/animation, as identified in Exhibit C, but excluding any third party
products. The Source Code shall include all versions and updates to the Source
Code, plus any pertinent commentary or explanation that may be necessary to
render the Source Code understandable and useable by a trained computer-
programmer of reasonable expertise in the relevant field. The Source Code shall
include system documentation, statements of principles of operation, and
schematics, all as necessary or useful for the effective understanding and use
of the Source Code. Insofar as UniServices has employed, in the development,
maintenance, or implementation of the Source Code, any device, programming, or
documentation not commercially available to Pacific on reasonable terms through
readily known third party sources other than UniServices, the Source Code shall
include all such devices, programming, or documentation, including any programs,
and further including compilers, workbenches, tools, and higher-level (or
"proprietary") languages used by
25
UniServices for the development, maintenance, and implementation of the Source
Code, to the extent such information may be included under any such third party
agreements.
5.4 Deposit. UniServices agrees to deposit verified Source Code (the
-------
"deposit materials" for purposes of the Preferred Escrow Agreement) which will
compile with DSI in accordance with the Preferred Escrow Agreement. UniServices
and Pacific agree to complete, sign and deliver to DSI the Exhibits to the
Preferred Escrow Agreement at the time this Agreement is signed by the parties
hereto.
5.5 Default in Development Services. In the event that UniServices: (1)
-------------------------------
ceases doing business, (2) substantially and materially fails to perform the
Development Services described in Section 4 hereof, or (3) substantially and
materially fails to perform its obligations under Section 5 hereof, and such
failure continues for 30 days after written notice by Pacific, and Pacific is
not in default of its own material obligations under this Agreement, then
subject to the dispute resolution procedure by officers of Pacific and
UniServices in order to be able to rectify and/or cure the default and to
continue the Development Services hereunder, and which officers' effort may be
followed 30 days thereafter by mediation pursuant to this Agreement, and failing
the successful resolution of the matter through mediation, may then be further
followed by arbitration pursuant to this Agreement in order to resolve such
default and possible remedy or cure. In the event Pacific claims a default
hereunder with respect to UniServices Development Services, which default is not
cured within 30 days, then Pacific may also suspend the payment of future
Development Fees accruing hereunder after such claimed default without the
necessity of resorting to the termination provisions provided under this
Agreement. In the event of the failure of mediation or arbitration to resolve
the default and possible cure or other
26
remedy, and which mediation or arbitration may include the resolution of the
disposition of the ownership and the obligation to pay any such suspended
Development Fees, then Pacific, upon further written notice to UniServices, may
terminate some or all of the provisions of Section 4 of this Agreement,
including its obligation to pay any further Development Fees to UniServices
hereunder, and Pacific, subject to the mediation and arbitration remedies
provided herein, shall be entitled to receive from the Escrow Agent the Source
Code and related materials in accordance with the terms of this Agreement and
the Preferred Escrow Agreement. In the event UniServices ceases doing business,
then without delay Pacific shall be entitled to receive from the Escrow Agent
the Source Code and related materials in accordance with the terms of this
Agreement and the Preferred Escrow Agreement. The termination in whole or in
part of Section 4 hereof shall not adversely affect the remaining provisions of
this Agreement, except as otherwise specifically provided herein.
SECTION 6 - EXTENSION
---------------------
6.1 Extension of Development Services. Pacific shall have the option of
---------------------------------
extending the Initial Term of this Agreement for the Research Group's provision
of Development Services pursuant to Section 4 for one or more additional one-
year terms. Pacific may exercise its option by giving written notice to
UniServices at least 30 days before the expiration of the Initial Term or of any
extension term, provided that Pacific is not in default of its obligations under
this Agreement beyond any applicable notice and grace or cure periods. The
Development Services to be provided by UniServices shall be provided during each
extension term on the same terms and conditions as during the Initial Term,
except that the Development Fee shall be $200,000
27
(and such amount shall be increased by an inflation factor for each future year
based on the then future level of the U.S. Department of Commerce Consumer Price
Index, with the Index Amount as of October 31, 2002 to be equal to 100% of such
$200,000 amount, but in no event may increase in the amount of such fee be more
than 12% per annum for the period from October 31, 2002 through to the date of
measurement) per year for each one-year extension term, and subject to any other
changes in this Agreement relating to Development Services which may be agreed
to in writing by the parties hereto.
6.2 Extension of Exclusivity. The exclusivity of the license granted in
------------------------
Section 2.1 hereof for the Additional Field shall be extended for so long as the
Development Services are extended pursuant to Section 6.1 hereof.
6.3 Perpetual Extension of Exclusivity. If UniServices defaults on its
----------------------------------
material obligations hereunder such that Pacific becomes entitled to receive the
Source Code and related materials from the Escrow Agent pursuant to this
Agreement and the Preferred Escrow Agreement, then the license granted in
Section 2 hereof shall automatically become exclusive in perpetuity for the
entire Additional Field and it shall remain exclusive in perpetuity for the
Entertainment Field.
SECTION 7 - TERMINATION
-----------------------
7.1 Basic Fee Payment Default. If Pacific fails to pay any installment of
-------------------------
the Basic Fee when due, and such failure continues for 30 days after written
notice by UniServices, then UniServices may terminate: (1) this Agreement,
and/or (2) the license granted in Section 2
28
hereof. In addition, UniServices may pursue any legal remedies available to it
pursuant to this Agreement in order to recover all amounts due and legally owing
to it hereunder from Pacific.
7.2 Development Fee Payment Default. If Pacific fails to pay any
-------------------------------
installment of the Development Fee when due, and such failure continues for 30
days after written notice by UniServices, then UniServices may terminate the
provisions of Section 4 of this Agreement and the license granted in Section 2
shall thereupon become non-exclusive for applications in the Additional Field.
In addition, UniServices may pursue any legal remedies available to it pursuant
to this Agreement in order to recover all amounts due and legally owing to it
hereunder by Pacific.
7.3 Intellectual Property Rights. If the license granted hereunder is
----------------------------
terminated pursuant to Section 7.1 above, then all rights licensed to Pacific
pursuant to this Agreement in CMISS/animation (other than Jointly Owned
Inventions and/or Jointly Owned Intellectual Property Rights developed
hereunder), shall revert to and shall thereafter be owned solely by UniServices,
free and clear of such license provisions. All Jointly Owned Inventions and/or
Jointly Owned Intellectual Property Rights shall continue to be Jointly Owned by
Pacific and UniServices subject to the terms and conditions hereof, and
regardless of whether this Agreement, any licenses, or the provisions for the
Development Services or Consulting Services to be performed hereunder have been
terminated.
7.4 Pacific's Separate Technologies. Any technology separately developed
-------------------------------
by Pacific or any of its Affiliates and not developed pursuant to this
Agreement, or any technology which is developed or is separately owned by
Pacific in conjunction with other third parties, shall be
29
owned solely by Pacific, or by Pacific and such third parties, and shall not be
owned by UniServices.
7.5 UniServices Separate Technologies. Any technology separately
---------------------------------
developed by UniServices or any of its Affiliates and not developed pursuant to
this Agreement, or any technology which is developed or is separately owned by
UniServices in conjunction with other third parties, shall be owned solely by
UniServices, or by UniServices and such third parties, and shall not be owned by
Pacific.
SECTION 8 - WARRANTIES AND GENERAL PROVISIONS
---------------------------------------------
8.1 UniServices Warranties. UniServices represents and warrants that:
----------------------
a) UniServices has exclusive, perpetual universe wide rights to the
copyright, trade secret and all other Intellectual Property
Rights in CMISS and in CMISS/animation, free and clear of all
liens, claims and encumbrances of every kind and description
whatsoever (except for those relating to dCMISS and which are
included in the UCSD Agreement);
b) UniServices has the legal right and authority to enter into this
Agreement and to carry out its obligations, agreements and
covenants hereunder, which obligations, agreements and covenants
are valid, binding and enforceable against UniServices in
accordance with their respective terms;
c) UniServices is not aware of any patent infringed by
CMISS/animation; and
d) the version of dCMISS previously delivered to UCSD by UniServices
does not materially infringe or otherwise violate the terms and
conditions of this
30
Agreement since it does not work on Animation Applications in the
form delivered to UCSD.
UniServices makes these warranties in lieu of all other warranties, express
or implied. UniServices has no control over the conditions under which Pacific
and/or its sub-licensees will use CMISS/animation, and it therefore cannot and
does not warrant the results to be obtained by such use. UNISERVICES EXPRESSLY
DISCLAIMS THE WARRANTIES OF MERCHANTABILITY, AND FITNESS FOR A PARTICULAR
PURPOSE OF CMISS/ANIMATION, INCLUDING ALL ENCHANCEMENTS, EXTENSIONS AND/OR
DERIVATIVE WORKS.
8.2 Liability. UniServices' liability arising hereunder from breach of
---------
contract, breach of warranty, indemnification, negligence, strict liability in
tort, or any other legal or equitable theory shall not exceed: (1) six million
U.S. dollars, inclusive of interest awarded, or (2) the total amount previously
paid by Pacific pursuant to this Agreement (i.e., the total license fee and the
total development fees paid through to the date of default), whichever amount is
greater. UniServices agrees to provide reasonably satisfactory financial
statements describing its financial condition to Pacific before Pacific signs
this Agreement, and such financial statements are attached hereto as Exhibit D.
NEITHER PARTY TO THIS AGREEMENT WILL BE LIABLE TO THE OTHER FOR ANY SPECIAL,
INCIDENTAL, OR CONSEQUENTIAL DAMAGES OF ANY TYPE EVEN IF IT HAS BEEN APPRISED OF
THE POSSIBILITY OF SUCH DAMAGES.
8.3 Indemnity. UniServices shall reasonably defend and shall indemnify and
---------
hold harmless Pacific against any charge of patent or copyright infringement or
unauthorized or
31
improper breach of confidentiality of trade secret obligations or similar
violations of law by UniServices in connection with the CMISS/animation
technology to be provided to Pacific pursuant to to this Agreement. If in the
opinion of Pacific, UniServices has not met such obligation, or is unable to
meet such obligation, and Pacific provides 30 days prior written notice to
UniServices in such regard, then UniServices hereby grants to Pacific all
exclusive or non-exclusive license, rights, and interests minimally required
under Applicable Law in order for Pacific to be able to legally defend and
protect its legal and economic interests hereunder, and this Agreement shall in
such event be either an exclusive or a non-exclusive license from UniServices in
favor of Pacific in order to permit Pacific to take all necessary legal actions
for such purpose. Pacific may not settle, enter a consent judgment or make any
other voluntary final disposition of any such suit, and including cross licenses
or other licenses, without the consent of UniServices, which consent may not be
unreasonably withheld or delayed. Except as otherwise provided herein, any
settlement, award or judgment granted in favor of Pacific or UniServices shall
be applied first to the recovery of legal and expert fees and other related
costs incurred by the successful party or parties for such purpose, with
interest included thereon at the prime rate, with any available balance of funds
to be divided between the parties as they may subsequently agree, based on their
then reasonably applied discretion and their Intellectual Property Rights and
other interest therein, and based on an equitable resolution of such matter
which considers the facts and circumstances which then exist.
8.4 Services of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇. In the event Professor ▇▇▇▇▇ ▇▇▇▇▇▇,
----------------------------
other than due to his death or disability, is unavailable through UniServices to
provide development services pursuant to this Agreement, then Pacific may pay
Professor ▇▇▇▇▇ ▇▇▇▇▇▇ directly to provide
32
such services to Pacific if he is available to the Pacific, and it may offset
its payments for such purpose against the Development Fee to the extent of its
actual payments to ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, not to exceed $150,000 per year in any year
during the Initial term, and not to exceed $200,000, as indexed for inflation as
provided herein, in any subsequent extended term year.
8.5 No Reverse Engineering. Pacific agrees that it (including any
----------------------
permitted sublicensees or assignees) will not attempt to disassemble or reverse
engineer CMISS and/or CMISS/animation, including any of their enhancements,
extensions and/or Derivative Works.
SECTION 9 - ADDITIONAL PROVISIONS
---------------------------------
9.1 Resolution of Disputes.
----------------------
a UniServices and Pacific intend to avoid litigation relating to or
arising out of this Agreement. In the event of any dispute or
perceived problem, each party pledges itself to give prompt
notice to the other party and to first seek an amicable
resolution of such dispute without regard to litigation. As part
of this effort at amicable resolution, the parties agree to
communicate and to meet and discuss any problems, and to search
in good faith for mutually acceptable business solutions to any
perceived problem. Each party shall be given thirty (30) days
from the date of any such notice to correct its performance under
this Agreement, or otherwise cure any breach or alleged breach of
contract, or otherwise arrive at any acceptable resolution of the
matter with the other party.
33
b. All disputes arising out of or relating to this Agreement (including
any questions of fraud or fraud in the inducement or questions
concerning the validity or enforceability of this Agreement or any of
the rights herein conferred) shall, unless earlier resolved by
discussions according to Paragraph a) hereof, or unless waived by the
aggrieved party, be resolved by voluntary mediation within a 30 day
period. In the event of the failure of the parties to reach agreement
in mediation, then the parties shall employ binding arbitration
pursuant to the commercial arbitration rules of the American
Arbitration Association ("AAA"), such arbitration to be held in Los
Angeles, California, and before a single arbitrator chosen jointly by
the parties. The arbitration shall be governed by the United States
Arbitration Act, 9 U.S.C. (S)(S) 1-16, to the exclusion of any
provision hereof which is inconsistent therewith or which would
produce a different result, and judgement upon the award rendered by
the arbitrator may be entered by any court having jurisdiction. The
power to grant an injunction shall be available to the arbitrator
where such remedy is provided pursuant to this Agreement, or is
otherwise necessary hereunder in order to accomplish the objectives of
this Agreement. Arbitration commenced and conducted pursuant to this
Agreement shall be completed within 60 days. Any decision by the
arbitrator may consist of only the adoption of either party's position
in the matter, as adopted by such party in writing and as submitted to
the arbitrator and the other party at or within ten (10) days
34
before the commencement of the formal arbitration proceeding, and
the arbitrator may not adopt any other position in its binding
decision, such arbitration being sometimes referred to as
"baseball arbitration," in that compromises in any formal
arbitration decision, in the absence of an agreement reached
voluntarily by the parties themselves, are to be discouraged. AAA
shall employ expedited procedures, regardless of the amount in
controversy, for purposes of any request for immediate injunctive
relief hereunder. For purposes of any immediate injunctive relief
sought hereunder, AAA shall select a three judge panel of retired
judges for this purpose only. In the event either party seeks
immediate injunctive relief hereunder, and to that extent only,
the provisions of this Agreement with respect to possible
agreement between the parties themselves and with respect to
mediation shall not apply, and either party may employ immediate
arbitration procedures hereunder for such limited purpose only.
c. This Section 9.1 shall survive any termination of this Agreement
and/or any termination of the licenses granted hereunder and/or
any termination of any provisions contained in this Agreement.
9.2 Force Majeure. If circumstances beyond the control of either party
-------------
(such as, for example, acts of God and government decrees or restrictions) shall
temporarily make it impossible for that party to perform its obligations under
this Agreement, then the principles of force majeure shall apply and the right
to terminate this Agreement shall be temporarily
35
suspended during the force majeure period, but only up to a maximum suspension
of one year for any such single event of force majeure, which events may occur
cumulatively more that once hereunder.
9.3 Agreement Disapproved or Unenforceable. If at any time during the life
--------------------------------------
of this Agreement, any governmental or regulatory agency, arbitrator or court
shall disapprove of this Agreement or any provision of this Agreement, or shall
find any part of this Agreement to be unenforceable, then the remaining
provisions of this Agreement shall remain in full force and effect, and Pacific
and UniServices shall cooperate in good faith to revise the disapproved or
unenforceable portions of this Agreement in a mutually satisfactory and
equitable manner and in a manner acceptable to said governmental agency or
arbitrator, or consistent with such judicial decree.
9.4 Proprietary and Confidential Information.
----------------------------------------
a. Each party hereto may disclose to the other certain proprietary
and confidential or trade secret information including (but not
limited to) inventions, trade secrets, technical or scientific
information, market research data, market plans, concepts, test
results, and customer and sales information. All such information
shall be deemed confidential, proprietary, and valuable trade
secret information which is the exclusive property of the party
from whom the information was derived. Each party shall use such
confidential information exclusively in accomplishing the
purposes of this Agreement, and shall not disclose such
information to others, except with the prior written consent of
such party. Each of the
36
parties shall disclose such confidential information only to
such of its employees that shall require the information in order
to carry out the purposes of this Agreement.
b. The restrictions and obligations applicable to the parties
relating to proprietary confidential information and trade
secrets shall not apply to any information of either party which:
a) Is known to the other party prior to receipt thereof under
this Agreement, as evidenced by written records; b) Is disclosed
to the other party in good faith by a third party who is in
lawful possession thereof and who has the right to make such
disclosure; c) Is or shall have become part of the public domain,
by publication or otherwise, through no fault of the party having
the obligation of confidentiality under this Agreement; or d) Is
required by law or applicable court or administrative order to be
disclosed. Except as otherwise provided herein, the disclosure of
any such confidential information does not give any express or
implied right or license to either party, whether under any
patents or copyrights of either party or otherwise, nor does it
give any express or implied right or license to such information
for any purposes other than relating to the purposes of this
Agreement.
9.5 Patent Perfection, and Copyright Registration. UniServices shall be
---------------------------------------------
solely responsible for preparing, filing, prosecuting and maintaining all
licensed patent applications, all licensed patented technologies, and all
licensed, registered or otherwise governmentally
37
certified or validated copyright rights hereunder which are owned solely by
UniServices, at its sole expense, and it may use patent or copyright counsel of
its own choice in so doing, and UniServices shall undertake and perform all such
actions to the best of its ability to do so and in its sole discretion. The
parties acknowledge and agree that CMISS and CMISS/animation have not previously
been filed for patent or copyright protection by UniServices, and as such
constitute UniServices' trade secrets. UniServices further acknowledges and
agrees that pending patent applications and copyright rights relating to Command
Files, as of June 1, 1998, are owned solely by Pacific, and further patent
and/or copyright applications, continuations in part, reissues, and
continuations may be filed by Pacific with respect to such patent and/or
copyright rights, and all Derivative Works or Enhancements thereof. With
respect to Jointly Owned Inventions and/or Jointly Owned Intellectual Property
Rights which are maintained in confidence as trade secrets, UniServices and
Pacific shall each have the right to object to and to prevent the other party
from making, preparing, prosecuting or maintaining any patent application or
copyright registration or making any other publication or public disclosure with
respect to such Jointly Owned Inventions and/or Jointly Owned Intellectual
Property Rights, and as further provided pursuant to this Agreement. If patent
applications or copyright registrations are subsequently agreed to be filed or
are consented to by the parties hereto for any Jointly Owned Inventions and/or
Jointly Owned Intellectual Property Rights developed hereunder, the costs and
expense thereof shall be paid for by both parties equally, or as they may
otherwise subsequently agree.
9.6 Independent Contractors. It is intended and agreed by the parties
-----------------------
hereto that they are independent contractors, and Pacific is a licensee of
UniServices hereunder. Pacific shall
38
not in any way act or hold itself out to the public as an agent of UniServices,
and Pacific shall have no power to incur any obligations of any kind on behalf
of UniServices. Similarly, UniServices agrees that it is an independent
contractor to Pacific, and that it will provide Development and Consulting
Services to Pacific as an independent contractor, and UniServices shall not in
any way act or hold itself out as an agent of Pacific, and UniServices shall
have no power to incur any obligations of any kind on behalf of Pacific. The
parties do not intend to form a partnership or joint venture, and no such
partnership or joint venture is formed by this Agreement and/or by any Plan
adopted hereunder.
9.7 Time is of the Essence. Time is of the essence for the performance of
----------------------
all obligations set forth in this Agreement. However, grace periods provided
herein for various purposes shall be construed with the objective and for the
purpose of allowing the parties to remain in compliance with and to cure or
remedy any alleged default hereunder, and to permit each of them to
satisfactorily perform the terms and conditions of this Agreement and their
obligations hereunder.
9.8 Counterparts. This Agreement may be executed in any number of
------------
counterparts and by different parties in separate counterparts, each of which,
when executed and delivered, shall be deemed to be an original, and all of
which, when taken together, shall constitute one and the same Agreement. In the
event the parties execute this Agreement in counterparts by facsimile
signature, each such party agrees to promptly forward to the other party the
signed original hard copy of this Agreement by overnight delivery service which
requires not more than four business days to accomplish such delivery.
39
9.9 Notice of License and use of UniServices Name. Pacific agrees that
---------------------------------------------
its products and services licensed or sold hereunder shall be appropriately
identified with all appropriate patent numbers or copyright registration
identification applicable to CMISS and/or CMISS/animation, and in a manner to
give proper legal notice thereof under any Applicable Law. However, no such
notice shall include reference to UniServices without its prior written consent,
which consent shall not be unreasonably withheld or delayed. Pacific shall not
market any services or products using the marks of or any endorsement of
UniServices unless separately authorized in writing by UniServices to do so.
9.10 Non-Solicitation. During the Initial Term, any extension term (as
----------------
described in Section 6), and for twelve months thereafter, neither party may
solicit any employee of the other who is involved in providing Development
Services or in licensing CMISS and/or CMISS/animation and their enhancements or
extended versions or derivative works, or in providing Consulting Services
therefor, without the prior written consent of the other party hereto, which
consent may be withheld or delayed in such other party's sole discretion.
9.11 Survival. The covenants, conditions, obligations, agreements,
--------
indemnities, representations, warranties, confidentiality and other provisions
hereof which by their terms contemplate the continuing performance of a party
hereto after the termination of this Agreement, and/or after the termination of
any license granted hereunder, and/or after the termination of any services to
be provided hereunder, shall survive the termination of this Agreement and/or
the termination of the license granted hereunder, and/or the termination of this
Agreement or of the license granted hereunder or of the services to be performed
hereunder, and shall not operate so as to relieve any party of legal
responsibility or liability for
40
its breach hereof, whether in damages or otherwise, and whether occurring
before or after any such termination has occurred.
9.12 The Plan. The Plan, as amended from time to time in accordance with
--------
this Agreement, shall for purposes of this Agreement be treated as if originally
incorporated into this Agreement by reference on the original effective date of
this Agreement.
9.13 Government Requirements and Approvals and Certain Laws. The parties
------------------------------------------------------
hereby agree that they will not ship or divert for us in any country any of the
Licensed Software, Source Code or other documentation or technical data with
respect thereto, and including the executable object code, in contravention of
the laws and regulations of the United States or any such countries or knowingly
allow such shipment or diversion. Each party shall use its reasonable efforts to
obtain all required governmental approvals necessary in connection with this
Agreement and the performance of their obligations hereunder. Without limiting
the generality of the foregoing, both Pacific and UniServices acknowledge that
their respective exportation of the licensed technologies and Jointly Owned
Inventions and/or Jointly Owned Intellectual Property Rights and related
technical documentation may be subject to compliance with the United States
Export Administration Act of 1979, as amended (collectively, the "Act"), and
both Pacific and UniServices warrant and represent to each other that each will
comply in all respects with the Act. In the event either party or both parties
publish any Source Code, or in the event the Source Code is not deemed to be
published for purposes of any applicable copyright law registration or copyright
protection available to either party hereto, and whether arising under common
law, by statute, by convention or otherwise, then the parties agree that the
provisions of the Berne Convention shall apply with respect to the Source Code
and the
41
executable object code held or developed hereunder, and regardless of whether it
has been published or is considered unpublished for purposes of this Agreement
and their making of any required filings, registrations, or governmental
certifications, or for purposes of obtaining the benefit of any applicable
copyright law with respect thereto. Pacific and UniServices each agree to
indemnify the other party hereto against any claim, losses, liability or damage
suffered or incurred by the other party and arising out of or relating to any
violation by such party of any of the provisions or covenants contained in this
Section.
9.14 Conflict with Applicable Law. In the event that any provision, term,
----------------------------
condition, or object of this Agreement may be in likely conflict with any
Applicable Law, and the legal counsel of either party shall advise that in its
considered opinion such conflict, or a reasonably likely possibility of such
conflict exists, then either party may propose to the other party appropriate
modifications of this Agreement to avoid such conflict. In such event the
parties hereto shall use their reasonable efforts to satisfactorily and
reasonably resolve such matter, subject to the provisions of Section 9.1 hereof.
9.15 Effectiveness Subject to Prior Approval or Registration. If the legal
-------------------------------------------------------
effectiveness of this Agreement is subject to the condition that it be approved
and/or registered by or with any governmental authority or agency, each party
shall act diligently and use its reasonable efforts to obtain such approval and
registration at its own expense in such country, this provision being a joint
covenant of the parties hereto. Either party shall present satisfactory evidence
to the other party that any such required approval and registration has been
obtained.
42
SECTION 10 - MISCELLANEOUS PROVISIONS
-------------------------------------
10.1 Waiver. A waiver by either party of any term or condition of this
------
Agreement shall not be construed on the same or any other occasion to be a
waiver of any other term or condition of this Agreement.
10.2 Applicable Law. This Agreement shall be governed by and construed in
--------------
accordance with the laws of the State of Delaware, and the Federal and other
laws of the United States of America, and without regard to the United Nations
1980 Convention on the international sale of goods, but with regard to the Berne
Convention concerning copyright claims, and except that the laws of the State of
Delaware shall not include its conflicts or choice of applicable laws
provisions. Applicable Law means any law, regulation, decree, order or statue of
the State of Delaware and United States of America Federal Law, and any treaty
or convention and regulations or orders issued thereunder and applicable to the
ownership or licensing and other commercial disposition of computer software and
related technologies and products and services, and found applicable to this
Agreement.
10.3 Entire Agreement. This Agreement constitutes the entire Agreement
----------------
between UniServices and Pacific pertaining to the subject matter hereof, and
supersedes all prior negotiations, discussions, and any agreements which may
have previously existed between the parties hereto or other parties, whether
written or oral, and which relates to the subject matter hereof.
10.4 Amendment. This Agreement may be amended or modified only by a signed
---------
written agreement executed by both UniServices and Pacific.
43
10.5 Non-assignment. Neither party may assign this Agreement without the
--------------
signed written consent of the other party hereto, except that this provision
shall not prevent Pacific or UniServices from sublicensing, selling or otherwise
commercially exploiting in accordance with the terms and conditions of this
Agreement the licensed or Jointly Owned Inventions and/or Jointly Owned
Intellectual Property Rights and technologies hereunder, or prevent either party
from performing its obligations or exercising its rights hereunder.
10.6 Agreement Binding. Each party acknowledges that it has read this
-----------------
Agreement, understands its terms, and agrees to be bound by its terms and
conditions.
10.7 Consent to Jurisdiction. In the event either party hereto brings a
-----------------------
claim, suit or other proceeding against the other party hereto for the purpose
of obtaining equitable relief or otherwise, or for the purpose of enforcing any
mediation agreement or arbitration agreement or arbitration award, both parties
consent to the exclusive personal jurisdiction of, and venue in, the State
courts within Los Angeles County, California, or in the event of Federal
jurisdiction, the Federal Courts of California, except as to any controversy or
claim required to resolved pursuant to Section 9.1 hereof, and with respect to
which said Section 9.1 the parties hereto also grant their consent.
10.8 Waiver of Trail By Jury. The parties hereto waive their right to
-----------------------
trail by jury in the event of any litigation between the parties hereto and
relating to this Agreement or their performance hereunder.
10.9 Headings. Section and subsection headings are included herein for
--------
convenience only, and such headings shall not be used in the interpretation of
this Agreement, or in the interpretation of any ambiguities which may be
contained herein.
44
10.10 Rules of Construction. Rules of interpretation of ambiguities
---------------------
against the draftman, and other fictional legal theories or rules of contract
construction shall not be applied to this Agreement, notwithstanding anything
contained herein (other than Section 9.7 hereof) or in any Applicable Law.
10.11 Notices. All notices to be given or otherwise made to any party
-------
to this Agreement shall be deemed to be sufficient if contained in a written
instrument, delivered by hand in person, or by express overnight courier
service, or by electronic facsimile transmission (with a conforming copy sent by
United States or New Zealand mail, registered or certified mail, return receipt
requested), or by registered or certified mail, return receipt requested,
postage prepaid, addressed to such party at the address set forth herein or at
such other address as may hereafter be designated in writing by the addressee to
the addressor and listing all parties. All such notices shall, when mailed or
telecopied, be effective when received or when attempted delivery is refused.
10.12 Remedies. The remedies provided herein are cumulative, may be
--------
exercised successively or concurrently, and are exclusive of any other remedies
provided by law.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and effective as of the date set forth above.
SIGNED for and on behalf of SIGNED for and on behalf of
AUCKLAND UNISERVICES, LTD.: PACIFIC TITLE/MIRAGE, INC.:
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
--------------------------- ----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Chief Executive Officer Co-President
Date: June 12, 1998 Date: 6/12/98
--------------------- ----------------------
45
[LETTERHEAD OF THE UNIVERSITY OF AUCKLAND]
[LOGO]
19 May 1998
Pacific Title/Mirage
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇
U.S.A.
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Dear ▇▇ ▇▇▇▇▇▇▇▇
Re: Technologies License, Development, Consulting and Collaboration Agreement
This letter is to confirm that it is the policy of The University of Auckland
that all research and development contracts using staff and other resources at
The University of Auckland shall be undertaken through Auckland UniServices
Limited (UniServices). UniServices is authorised to make such arrangements on
terms which suit both the University and UniServices.
This policy has been in effect since December 1990 and it is contemplated that
this arrangement will continue for at least the next five years.
I confirm that I am aware of the contractual arrangements currently being
negotiated between Pacific Title/Mirage and UniServices.
Your sincerely
/s/ ▇.▇. ▇▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇
REGISTRAR
================================================================================
Draft
19 December 1996
THE UNIVERSITY OF AUCKLAND
(UOA)
AUCKLAND UNISERVICES LIMITED
(UniServices)
DEED OF ASSIGNMENT OF INTELLECTUAL PROPERTY
BROOKFIELDS
LAWYERS
AUCKLAND & MANUKAU
================================================================================
DEED OF ASSIGNMENT OF INTELLECTUAL PROPERTY
DEED dated the 28th day of FEBRUARY 1997
PARTIES
1. THE UNIVERSITY OF AUCKLAND ("UOA")
2. AUCKLAND UNISERVICES LIMITED ("UniServices")
INTRODUCTION
A. UniServices is a company wholly owned by UOA
B. UniServices was incorporated for the purpose, amongst other things, of
identifying and developing intellectual property created by UOA staff and
therefore the property of UOA, for commercial gain.
C. The parties have agreed that to enable Uniservices to carry out this
function all such intellectual property shall become the property of
UniServices.
THIS DEED RECORDS:
1. DEFINITIONS AND INTERPRETATION
1.1 In this deed unless the context otherwise requires:
"Intellectual Property" means all intellectual property which at the date
of this deed or in the future and whether existing at the date of this deed
or created in the future, becomes the property of UOA and includes all
copyright patents, plant varieties and designs and all confidential
information and know how but does not include the Excluded Intellectual
Property.
"Excluded Intellectual Property" means:
(a) all the trademarks and rights to any names and all goodwill and
copyright associated with the same;
(b) all rights to any journal articles, books and any other artistic
literature including novels and poems;
(c) all rights to any works of art or music; and
(d) all rights to any instructive material (other than computer software).
-2-
"Commercial Intellectual Property" means Intellectual Property identified
by UniServices for commercial exploitation or with a potential for
commercial exploitation as provided in clause 3.1.
1.2 In this deed:
(a) Where the context permits, the singular includes the plural and vice
versa.
(b) References to any "party" mean a party to this deed and include the
successors, executors, administrators and permitted assignees (as the
case may be) of that party.
(c) Anything which may be done at any time may also be done from time to
time (unless stated otherwise).
2. ASSIGNMENT
2.1 In consideration of the covenants contained in this deed UOA assigns all
the Intellectual Property to UniServices absolutely and where that
Intellectual Property or UOA's right to the same come into existence after
the date of this deed this clause shall operate to vest that Intellectual
Property in UniServices immediately that Intellectual Property comes into
existence or becomes the property of UOA.
3. COMMERCIAL DEVELOPMENT AND PROTECTION BY UNISERVICES
3.1 UniServices shall constantly review the Intellectual Property with a view
to identifying any parts of the Intellectual Property suitable for
commercial exploitation or which if further developed may become suitable
for commercial exploitation.
3.2 Upon identifying any Commercial Intellectual Property, UniServices shall
take all reasonable steps to commercially exploit that Commercial
Intellectual Property or to develop it further with a view to its
commercial exploitation.
3.3 If UniServices wishes to develop any Commercial Intellectual Property
further, UniServices shall inform suitably qualified staff of UOA and then
enter into negotiations with those staff on any terms on which UniServices
may be prepared to further develop that Commercial Intellectual Property
using the services of UOA or that staff of UOA acting as independent
contractors. Such negotiations shall be on the understanding that:
(a) All negotiations will on an arms length basis.
(b) UniServices will be free to negotiate and to make any agreement with
any third party at its discretion.
-3-
UniServices shall ensure that any arrangement negotiated with or involving
UOA staff complies in all things with UOA's then current staffing policies
on staff involved in projects of this nature.
3.4 UniServices shall take all reasonable steps to protect any Commercial
Intellectual Property including, where appropriate, filing patent
applications in New Zealand and elsewhere. In making any decision in this
regard Uniservices may take into account the cost of such protection
against the value and likelihood of any commercial gain.
4. PROTECTION BY UOA
4.1 UOA shall procure that its staff take all steps to inform UniServices of
the development of any Intellectual Property which may reasonably be
considered Commercial Intellectual Property and shall not disclose the same
to any person other than UniServices, until UniServices has confirmed to
that staff member whether UniServices considers such Intellectual Property
to be Commercial Intellectual Property or not.
4.2 UOA shall also procure that UOA's staff Maintain as confidential at all
times, and not at any time, directly or indirectly:
(a) Disclose or permit to be disclosed to any person; or
(b) Use for themselves; or
(c) Use to the detriment of UniServices,
any Commercial Intellectual Property except
(i) As required by law; or
(ii) Where it is already or has become public knowledge; or
(iii) As authorised in writing by UniServices.
4.3 UniServices agrees that it will not unreasonably withhold its consent to
the publication of any Commercial Intellectual Property as part of an
academic paper to be published by a member of UOA staff provided:
(a) Such publication does not result in UniServices being in breach of any
obligation to any third party;
(b) The academic paper is submitted to UniServices for its approval
before it is released to any third party.
(c) UniServices may delay any publication or disclosure to allow
protection of any Commercial Intellectual Property.
-4-
(d) UniServices may require any Commercial Intellectual Property which
Uniservices considers, at its discretion, to be commercially sensitive
to be deleted.
4.4 UOA shall procure that any member of UOA staff involved in the development
of any Commercial Intellectual Property are available for and assist
UniServices in any steps UniServices wishes to take to protect that
Commercial Intellectual Property including lending their name to any patent
application or otherwise.
5. LIABILITY
5.1 Except as provided in this deed, UOA shall not be liable to UniServices for
any loss or damage whatsoever or howsoever caused arising directly or
indirectly in connection with any Intellectual Property, its use or
otherwise, except that which it is unlawful to exclude.
5.2 To the extent permitted by law all statutory or other implied warranties
are hereby excluded.
6. GENERAL
6.1 No waiver of any breach, or failure to enforce any provision, of this deed
at any time by either party shall in any way limit or waive the right of
that party to subsequently require strict compliance with this deed.
6.2 This deed is governed by the laws of New Zealand and the parties submit to
the exclusive jurisdiction of the New Zealand courts in respect of all
matters relating to this deed.
6.3 If any provision of this deed is or becomes invalid or unenforceable, that
provision shall be deemed deleted from this deed and such invalidity or
unenforceability shall not affect the other provisions of this deed, all of
which shall remain in full force and effect to the extent permitted by law,
subject to any modifications made necessary by the deletion of the invalid
or unenforceable provisions.
6.4 Each party shall do all things and execute all documents reasonably
required in order to give effect to the provisions and intent of this deed.
6.5 The parties agree that at the time it is assigned by this deed the value of
the Intellectual Property is zero. However, if GST is or becomes payable in
respect of the assignment of any Intellectual Property the amount of that
GST shall be paid by UniServices to UOA upon demand by UOA.
-5-
EXECUTION
THE SEAL of )
THE UNIVERSITY OF )
AUCKLAND )
was hereunto affixed )
in the presence of: )
/s/ [ILLEGIBLE] Member of Council
-------------------------------------
/s/ [ILLEGIBLE] Member of Council
-------------------------------------
/s/ [ILLEGIBLE] Registrar
-------------------------------------
SIGNED by )
AUCKLAND UNISERVICES )
LIMITED )
by: )
/s/ [ILLEGIBLE]
-------------------------------------
(Director)
/s/ [ILLEGIBLE]
-------------------------------------
(Director)
SOFTWARE AGREEMENT
SOFTWARE AGREEMENT ("Agreement") dated the 2nd day of March, 1998 ("Effective
Date")
PARTIES
1. AUCKLAND UNISERVICES LIMITED (Uniservices")
2. THE REGENTS OF THE UNIVERSITY OF CALIFORNIA ("The Regents") on behalf of
the San Diego campus ("UCSD")
INTRODUCTION
A. In the late 1980's the computer programme known as "CMISS" was developed by
staff at the University of Auckland. Professor ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
("▇▇▇▇▇▇▇▇▇"), currently an employee of UCSD, was a staff member involved
in the development of the programme.
B. All of the University of Auckland's rights in CMISS have been transferred
to Uniservices.
▇. ▇▇▇▇▇▇▇▇▇ has, using elements of CMISS, developed a programme known as
dCMISS (SDC98008).
D. The parties hereto wish to enter into an agreement regarding the licensing
of CMISS to The Regents by Uniservices.
Therefore, the parties agree as follows:
AGREEMENT
1. DEFINITION AND INTERPRETATION
Definition
1.1 In this agreement, unless the context otherwise requires:
"Drug Discovery" means any discovery for therapeutics realised through,
with, or aided by the use of dCMISS in: (i) drug identification,
validation, testing and assessment of drug targets; (ii) assay development
using drug targets, including cell construction and adaptation to assay
format by way of high throughput formats; (iii) identification screening of
potential drug lead compounds, including natural products, synthetic
compounds and combinatorial libraries of compounds; (iv) identification of
lead components and medicinal chemistry candidates; (v) development of
surrogate assays which may, in addition to other uses, be necessary to
follow in-vivo trials, pre-clinical animal studies, including
determinations of dosage, specificity assimilation, distribution among
tissues, metabolism and excretion of the compound; (vi) design, assessment
and testing of delivery modes, routes and formulations; and (vii) clinical
testing and/or marketing of drug candidates.
1.2 In this Agreement:
a) Where the context permits the singular includes the plural and vice
versa.
b) References to any "party" means a party to this Agreement and include
the successors, executors, administrators and permitted assignees, as
the case may be, of that party.
c) Where the context permits, references to a "person" include an
individual, firm, company, corporation or unincorporated body of
persons, any public, territorial or regional authority, any
government, and any agency of any government or of any such authority.
d) References to "dCMISS" in the text refer to elements of CMISS source
code contained in the dCMISS source code.
2. ACKNOWLEDGEMENTS
2.1 The Regents acknowledge that dCMISS contains elements of CMISS developed by
the University of Auckland.
2.2 The Regents acknowledge that the elements of CMISS contained in dCMISS are
owned by the University of Auckland.
2.3 Uniservices has indicated that Uniservices has acquired all rights to CMISS
from the University of Auckland.
3. USE OF dCMISS
3.1 Subject to clause 3.2, Uniservices licenses to The Regents the right to use
the elements of CMISS contained in dCMISS.
3.2 The Regents shall not license, or deliver for the use of others, the
elements of CMISS contained in dCMISS for any commercial use in the Drug
Discovery area.
3.3 From the effective date of this Agreement, The Regents agree not to use the
term "CMISS" in any name of or reference to dCMISS.
4. CONFIDENTIALITY AND SUPPLY OF dCMISS SOURCE CODE
4.1 As of the Effective Date of this Agreement, The Regents shall exercise all
reasonable efforts to maintain confidential at all times, and shall not at
any time, directly or indirectly, disclose or permit to be disclosed any
elements of the CMISS source code contained in the dCMISS source code to
any person, including employees of UCSD, except as provided in clause 4.2
of this Agreement or as authorized in writing by UniServices.
4.2 The Regents may disclose any of the elements of CMISS source code which are
part of the dCMISS source code to any person provided that contained
therein is an appropriate warning as to limitation on further disclosure
and use for commercial purposes. Such warning shall include the following:
a) The receiving party agrees to use the source code for academic purposes
only; and
b) The receiving party will not have any commercial undertaking involving
the use of the dCMISS source code; and
c) The receiving party covenants not to disclose that source code to any
further person; and
d) The receiving party acknowledges that part of the dCMISS source code,
developed at the University of Auckland, is not owned by The Regents
but by a third person.
5. TERMS AND TERMINATION
5.1 This agreement will take effect on the Effective Date and shall remain in
effect until or unless terminated in accordance with clause 5.2 or clause
5.3.
5.2 In addition to any other right of termination or remedy conferred on the
parties under this Agreement or by law, UniServices may, at its absolute
discretion, either withdraw in whole or in part any consent to and/or
license of the use of the elements of CMISS contained within dCMISS as set
out in clause 3 of this Agreement or terminate this Agreement at any time
and with immediate effect by written notice given to The Regents if:
a) The Regents has failed to comply with an earlier written notice given
by
UniServices specifying material breach of this Agreement by The
Regents and, in the case of a breach which is capable of remedy,
requiring that The Regents remedy the breach within 7 days after
receipt of that earlier notice.
b) The Regents has committed any material breach of this Agreement, which
breach is not reasonably capable of being remedied by The Regents
within 7 days.
5.3 Upon termination of this Agreement for whatever reasons:
a) Such termination shall be without prejudice to the rights and remedies
of either party in respect of any breach of this Agreement by the
other party, where such breach occurred prior to the termination of
this Agreement.
b) The provision of clause 4.1, together with those other provisions of
this Agreement which are incidental to and required in order to give
effect to that clause, shall remain in full force and effect for five
(5) years after termination of this Agreement.
6. DISPUTES
6.1 The parties shall meet and discuss in good faith any dispute between them
arising out of this Agreement.
6.2 If the discussions referred to in clause 6.1 fail to resolve the relevant
dispute, either party may, by written notice to the other party, require
that the dispute be submitted for mediation by a single mediator nominated
by the President for the time being of the Auckland District Law Society.
In the event of any such submission to mediation:
a) The mediator shall be deemed to be not acting as an expert or as an
arbitrator.
b) The mediator shall determine the procedure and timetable for the
mediation. Participation by telephone shall be acceptable.
c) The cost of the mediation shall be shared equally between the parties.
6.3 Neither party may issue any legal proceedings, other than for urgent
interlocutory relief, in respect of any such dispute, unless that party has
first taken all reasonable steps to comply with clauses 6.1 and 6.2.
7 NON WAIVER
7.1 No waiver of any breach, or failure to enforce any provision, of this
Agreement at any time by any party shall in any way limit or waive the
right of that party to subsequently
enforce and compel strict compliance with this Agreement.
8. NON ASSIGNMENT
8.1 The Regents shall not transfer or assign any of their liabilities or rights
under this Agreement to any other person without the prior written consent
of Uniservices, which consent may be withheld at Uniservices' absolute
discretion.
EXECUTION
SIGNED on behalf of AUCKLAND UNISERVICES LIMITED by:
/s/ ▇▇▇▇ ▇. Kernoban
------------------------------------------------
▇▇▇▇ Kernoban, Chief Executive Officer
Date: March 16, 1998
-------------------------------------------
SIGNED on behalf of THE REGENTS OF THE UNIVERSITY OF CALIFORNIA
/s/ ▇▇▇▇ ▇▇▇▇
------------------------------------------------
▇▇▇▇ ▇▇▇▇, Director, Technology Transfer Office
Date: 3/2/98
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EXHIBIT C
PREFERRED ESCROW AGREEMENT
Account Number ___________________
This Agreement is effective ______________, 19_____ among Data Securities
International, Inc. ("DSI"), Auckland UniServices Limited ("Depositor") and
Pacific Title/Mirage, Inc. ("Preferred Beneficiary"), who collectively may be
referred to in this Agreement as "the parties."
A. Depositor and Preferred Beneficiary have entered or will enter into a
license agreement, development agreement, collaborative agreement, and/or other
agreement regarding certain proprietary technology of Depositor (referred to in
this Agreement as "the license agreement").
B. Depositor desires to avoid disclosure of its proprietary technology
except under certain limited circumstances.
C. The availability of the proprietary technology of Depositor is
critical to Preferred Beneficiary in the conduct of its business and, therefore,
Preferred Beneficiary needs access to the proprietary technology under certain
limited circumstances.
D. Depositor and Preferred Beneficiary desire to establish an escrow with
DSI to provide for the retention, administration and controlled access of the
proprietary technology materials of Depositor.
E. The parties desire this Agreement to be supplementary to the license
agreement pursuant to ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ [Bankruptcy] Code, Section 365(n).
ARTICLE 1 -- DEPOSITS
1.1 Obligation to Make Deposit. Upon the signing of this Agreement by the
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parties, Depositor shall deliver to DSI the proprietary information and other
materials ("deposit materials") required to be deposited by the license
agreement or, if the license agreement does not identify the materials to be
deposited with DSI, then such materials will be identified on an Exhibit A. If
Exhibit A is applicable, it is to be prepared and signed by Depositor and
Preferred Beneficiary. DSI shall have no obligation with respect to the
preparation, signing or delivery of Exhibit A.
1.2 Identification of Tangible Media. Prior to the delivery of the deposit
--------------------------------
materials to DSI, Depositor shall conspicuously label for identification each
document, magnetic tape, disk, or other tangible media upon which the deposit
materials are written or stored. Additionally, Depositor shall complete Exhibit
B to this Agreement by listing each such tangible media by the item label
description, the type of media and the quantity. The Exhibit B must be signed by
Depositor and delivered to DSI with the deposit materials. Unless and until
Depositor makes the initial deposit with DSI, DSI shall have no obligation with
respect to this Agreement, except the obligation to notify the parties regarding
the status of the deposit account as required in Section 2.2 below.
1.3 Deposit Inspection. When DSI receives the deposit materials and the
------------------
Exhibit B, DSI will conduct a deposit inspection by visually matching the
labelling of the tangible media containing the deposit materials to the item
descriptions and quantity listed on the Exhibit B. In addition to the deposit
inspection, Preferred Beneficiary may elect to cause a verification of the
deposit materials in accordance with Section 1.6 below.
1.4 Acceptance of Deposit. At completion of the deposit inspection, if
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DSI determines that the labelling of the tangible media matches the item
descriptions and quantity on Exhibit B, DSI will date and sign the Exhibit B and
mail a copy of Exhibit B to Depositor and Preferred Beneficiary. If DSI
determines that the labelling does not match the item descriptions or quantity
on the Exhibit B, DSI will (a) note the discrepancies in writing on the Exhibit
B; (b) date and sign the Exhibit B with the exceptions noted; and (c) provide a
copy of the Exhibit B to Depositor and Preferred Beneficiary. DSI's acceptance
of the deposit occurs upon the signing of the Exhibit B by DSI. Delivery of the
signed Exhibit B to Preferred Beneficiary is Preferred Beneficiary's notice that
the deposit materials have been received and accepted by DSI.
1.5 Depositor's Representations. Depositor represents as follows:
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a. Depositor lawfully possess all of the deposit materials deposited with
DSI;
b. With respect to all of the deposit materials, Depositor has the right
and authority to grant to DSI and Preferred Beneficiary the rights as
provided in this Agreement;
c. The deposit materials are not subject to any lien or other
encumbrance;
d. The deposit materials consist of the proprietary information and other
materials identified either in the license agreement or Exhibit A, as
the case may be; and
e. The deposit materials are readable and useable in their current form
or, if the deposit materials are encrypted, the decryption tools and
decryption keys have also been deposited, and include all required
versions thereof needed to make the deposit materials useful to the
Beneficiary.
1.6 Verification. Preferred Beneficiary shall have the right, at
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Preferred Beneficiary's expense, to cause a verification of any deposit
materials. A verification determines, in different levels of detail, the
accuracy, completeness, sufficiency and quality of the deposit materials. If a
verification is elected after the deposit materials have been delivered to DSI,
then only DSI, or at DSI's election an independent person or company selected
and supervised by DSI, may perform the verification.
1.7 Deposit Updates. Except as otherwise provided by the license
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agreement, Depositor shall update the deposit materials within 50 days of each
release of a new version of the product which is subject to the license
agreement. Such updates will be added to the existing deposit. All deposit
updates shall be listed on a new Exhibit B and the new Exhibit B shall be signed
by Depositor. Each Exhibit B will be held and maintained separately within the
escrow account. An independent record will be created which will document the
activity for each Exhibit B. The processing of all deposit updates shall be in
accordance with Sections 1.2
through 1.6 above. All references in this Agreement to the deposit materials
shall include the initial deposit materials and any updates for all needed
versions thereof.
1.8 Removal of Deposit Materials. The deposit materials may be removed
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and/or exchanged only on written instructions signed by Depositor and Preferred
Beneficiary, or as otherwise provided in this Agreement.
ARTICLE 2 -- CONFIDENTIALITY AND RECORD KEEPING
2.1 Confidentiality. DSI shall maintain the deposit materials in a secure,
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environmentally safe, locked facility which is accessible only to authorized
representatives of DSI. DSI shall have the obligation to reasonably protect the
confidentiality of the deposit materials. Except as provided in this Agreement,
DSI shall not disclose, transfer, make available, or use the deposit materials.
DSI shall not disclose the content of this Agreement to any third party. If DSI
receives a subpoena or other order of a court or other judicial tribunal
pertaining to the disclosure or release of the deposit materials, DSI will
immediately notify the parties to this Agreement. It shall be the responsibility
of Depositor and/or Preferred Beneficiary to challenge any such order; provided,
however, that DSI does not waive its rights to present its position with respect
to any such order. DSI will not be required to disobey any court or other
judicial tribunal order. (See Section 7.5 below for notices of requested
orders).
2.2 Status Reports. DSI will issue to Depositor and Preferred
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Beneficiary a report profiling the account history at least semi-annually.
DSI may provide copies of the account history pertaining to this Agreement upon
the request of any party to this Agreement.
2.3 Audit Rights. During the term of this Agreement, Depositor and
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Preferred Beneficiary shall each have the right to inspect the written records
of DSI pertaining to this Agreement. Any inspection shall be held during normal
business hours and following reasonable prior notice.
ARTICLE 3 -- GRANT OF RIGHTS TO DSI
3.1 Title to Media. Depositor hereby transfers to DSI the title to the
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media upon which the proprietary information and materials are written or
stored. However, this transfer does not include the ownership of the
proprietary information and materials contained on the media such as any
copyright, trade secret, patent or other intellectual property rights, except as
otherwise provided on the license agreement.
3.2 Right to Make Copies. DSI shall have the right to make copies of the
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deposit materials as reasonably necessary to perform this Agreement. DSI shall
copy all copyright, nondisclosure, and other proprietary notices and titles
contained on the deposit materials onto any copies made by DSI. With all deposit
materials submitted to DSI, Depositor shall provide any and all instructions as
may be necessary to duplicate the deposit materials including but not limited to
the hardware and/or software needed.
3.3 Right to Transfer Upon Release. Depositor hereby grants to DSI the
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right to transfer the deposit materials to Preferred Beneficiary upon any
release of the deposit materials for use by Preferred Beneficiary in accordance
with Section 4.5. Except upon such a release or as otherwise provided in this
Agreement. DSI shall not transfer the deposit materials.
ARTICLE 4 -- RELEASE OF DEPOSIT
4.1 Release Conditions. As used in this Agreement, "Release Conditions"
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shall mean the following:
a. Depositor's failure to substantially and materially carry out the
obligations, agreements, covenants or representations imposed on
it pursuant to the license agreement; or
b. Depositor's failure to continue to do business in the ordinary
course.
4.2 Filing for Release. When Preferred Beneficiary believes in good faith
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that a Release Condition has occurred, Preferred Beneficiary may provide to DSI
written notice of the occurrence of the Release Condition and a request for the
release of the deposit materials. Upon receipt of such notice, DSI shall
provide a copy of the notice to Depositor, by hand or by facsimile (with
confirmation copy by certified mail, return receipt requested, or by commercial
express mail).
4.3 Contrary Instructions. From the date DSI delivers the notice
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requesting release of the deposit materials, Depositors shall have twenty
business days to deliver to DSI Contrary Instructions. "Contrary Instructions"
shall mean the written representation by Depositor that a Release Condition has
not occurred or has been cured. Upon receipt of Contrary Instructions, DSI
shall send a copy to Preferred Beneficiary by hand or by facsimile (with
confirmation copy by certified mail, return receipt requested, or by commercial
express mail). Additionally, DSI shall notify both Depositor and Preferred
Beneficiary that there is a dispute to be resolved pursuant to the Dispute
Resolution section (Section 7.3) of this Agreement. Subject to Section 5.2, DSI
will continue to store the deposit materials without release pending (a) joint
instructions from Depositor and Preferred Beneficiary; (b) resolution pursuant
to the Dispute Resolution provisions; or (c) order of a court.
4.4 Release of Deposit. If DSI does not receive Contrary Instructions
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from the Depositor, DSI is authorized to release the deposit materials to the
Preferred Beneficiary or, if more than one beneficiary is registered to the
deposit, to release a copy of the deposit materials to the Preferred
Beneficiary. However, DSI is entitled to receive any fees due DSI before making
the release. This Agreement will terminate upon the release of the deposit
materials held by DSI.
4.5 Right to Use Following Release. Unless otherwise provided in the
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license agreement, upon release of the deposit materials in accordance with this
Article 4, Preferred Beneficiary shall have the right to use the deposit
materials for the sole purpose of continuing the benefits afforded to Preferred
Beneficiary by the license agreement. Except as otherwise provided in the
license agreement, Preferred Beneficiary shall be obligated to maintain the
confidentiality of the released deposit materials.
ARTICLE 5 -- TERM AND TERMINATION
5.1 Term of Agreement. The initial term of this Agreement is for a period
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of one year. Thereafter, this Agreement shall automatically renew from
year-to-year unless (a) Depositor and Preferred Beneficiary jointly instruct
DSI in writing that the Agreement is
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terminated; or (b) the Agreement is terminated by DSI for nonpayment in
accordance with Section 5.2. If the deposit materials are subject to another
escrow agreement with DSI, DSI reserves the right, after the initial one year
term, to adjust the anniversary date of this Agreement to match the then
prevailing anniversary date of such other escrow arrangements.
5.2 Termination for Nonpayment. In the event of the nonpayment of fees
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owed to DSI, DSI shall provide written notice of delinquency to all parties to
this Agreement. Any party to this Agreement shall have the right to make the
payment to DSI to cure the default. If the past due payment is not received in
full by DSI within one month of the date of such notice, then DSI shall have the
right to terminate this Agreement at any time thereafter by sending written
notice of termination to all parties. DSI shall have no obligation to take any
action under this Agreement so long as any payment due to DSI remains unpaid.
5.3 Disposition of Deposit Materials Upon Termination. Upon termination
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of this Agreement by joint instruction of Depositor and Preferred Beneficiary,
DSI shall destroy, return, or otherwise deliver the deposit materials in
accordance with Depositor's instructions. Upon termination for nonpayment, DSI
may, at its sole discretion, destroy the deposit materials or return them to
Depositor. DSI shall have no obligation to return or destroy materials if the
deposit materials are subject to another escrow agreement with DSI.
5.4 Survival of Terms Following Termination. Upon termination of this
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Agreement, the following provisions of this Agreement shall survive:
a. Depositor's Representations (Section 1.5);
b. The obligations of confidentiality with respect to the deposit
materials;
c. The rights granted in the sections entitled Right to Transfer
Upon Release (Section 3.3) and Right to Use Following Release
(Section 4.5), if a release of the deposit materials has occurred
prior to termination;
d. The obligation to pay DSI any fees and expenses due;
e. The provisions of Article 7; and
f. Any provisions of this Agreement which specifically state they
survive the termination or expiration of this Agreement.
ARTICLE 6 -- DSI'S FEES
6.1 Fee Schedule. DSI is entitled to be paid its standard fees and
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expenses applicable to the services provided. DSI shall notify the party
responsible for payment of DSI's fees at least 90 days prior to any increase in
fees. For any service not listed on DSI's standard fee schedule, DSI will
provide a quote prior to rendering the service, if requested.
6.2 Payment Terms. DSI shall not be required to perform any service
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unless the payment for such service and any outstanding balances owed to DSI are
paid in full. All other fees are due upon receipt of invoice. If invoiced fees
are not paid, DSI may terminate this Agreement in accordance with Section 5.2.
Late fees on past due amounts shall accrue at the
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rate of one and one-half percent per month (18% per annum) from the date of the
invoice.
ARTICLE 7 -- LIABILITY AND DISPUTES
7.1 Right to Rely on Instructions. DSI may act in reliance upon any
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instruction, instrument, or signature reasonably believed by DSI to be genuine.
DSI may assume that any employee of a party to this Agreement who gives any
written notice, request, or instruction has the authority to do so. DSI shall
not be responsible for failure to act as a result of causes beyond the
reasonable control of DSI.
7.2 Indemnification. DSI shall be responsible to perform its obligations
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under this Agreement and to act in a reasonable and prudent manner with regard
to this escrow arrangement. Provided DSI has acted in the manner stated in the
preceding sentence, Depositor and Preferred Beneficiary each agree to indemnify,
defend and hold harmless DSI from any and all claims, actions, damages,
arbitration fees and expenses, costs, attorney's fees and other liabilities
incurred by DSI relating in any way to this escrow arrangement.
7.3 Dispute Resolution. Except as otherwise provided by the license
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agreement, any dispute relating to or arising from this Agreement shall be
resolved by arbitration under the Commercial Rules of the American Arbitration
Association. Unless otherwise agreed by Depositor and Preferred Beneficiary,
arbitration will take place in Los Angeles, California, U.S.A. Any court having
jurisdiction over the matter may enter judgment on the award of the
arbitrator(s). Service of a petition to confirm the arbitration award may be
made by First Class mail or by commercial express mail, to the attorney for the
party or, if unrepresented, to the party at the last known business address.
7.4 Controlling Law. This Agreement is to be governed and construed in
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accordance with the Applicable Law provisions of the license agreement.
7.5 Notice of Requested Order. If any party intends to obtain an order
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from the arbitrator or any court of competent jurisdiction which may direct DSI
to take, or refrain from taking any action, that party shall:
a. Give DSI at least two business days' prior notice of the hearing;
b. Include in any such order that, as a precondition to DSI's
obligation, DSI be paid in full for any past due fees and be paid
for the reasonable value of the services to be rendered pursuant
to such order; and
c. Ensure that DSI not be required to deliver the original (as
opposed to a copy) of the deposit materials if DSI may need to
retain the original in its possession to fulfill any of its other
duties.
ARTICLE 8 -- GENERAL PROVISIONS
8.1 Entire Agreement. This Agreement, which includes the Exhibits
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described herein, embodies the entire understanding among the parties with
respect to its subject matter and supersedes all previous communications,
representations or understandings, either oral or
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written. No amendment or modification of this Agreement shall be valid or
binding unless signed by all the parties hereto, except that Exhibit A need not
be signed by DSI, Exhibit B need not be signed by Preferred Beneficiary, and
Exhibit C need not be signed.
8.2 Notices. All notices, invoices, payments, deposits and other documents
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and communications shall be given to the parties at the addresses specified in
the attached Exhibit C. It shall be the responsibility of the parties to notify
each other as provided in this Section in the event of a change of address. The
parties shall have the right to rely on the last known address of the other
parties. Unless otherwise provided in this Agreement, all documents and
communications may be delivered by First Class mail.
8.3 Severability. In the event any provision of this Agreement is found to
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be invalid, voidable or unenforceable, the parties agree that unless it
materially affects the entire intent and purpose of this Agreement, such
invalidity, voidability or unenforceability shall affect neither the validity of
this Agreement nor the remaining provisions herein, and the provision in
question shall be deemed to be replaced with a valid and enforceable provision
most closely reflecting the intent and purpose of the original provision.
8.4 Successors. This Agreement shall be binding upon and shall inure to
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the benefit of the successors and assigns of the parties. However, DSI shall
have no obligation in performing this Agreement to recognize any successor or
assign of Depositor or Preferred Beneficiary unless DSI receives clear,
authoritative and conclusive written evidence of the change of parties.
Auckland UniServices Limited Pacific Title/Mirage, Inc.
________________________________ _______________________________
Depositor Preferred Beneficiary
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇. ▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Name: ▇▇. ▇▇▇▇ ▇▇▇▇▇
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Title: CHIEF EXECUTIVE OFFICER Title: Co-President
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Date: JUNE 12, 1998 Date: 5/24/98
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Data Securities International, Inc.
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: VP SALES & MARKETING
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Date: 6-12-98
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EXHIBIT A
MATERIALS TO BE DEPOSITED
Account Number __________
Depositor represents to Preferred Beneficiary that deposit materials delivered
to DSI shall consist of the following:
Auckland UniServices Limited Pacific Title/Mirage, Inc.
________________________________ _______________________________
Depositor Preferred Beneficiary
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇. ▇▇▇▇ ▇▇▇▇▇
----------------------------- ----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Name: ▇▇. ▇▇▇▇ ▇▇▇▇▇
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Title: CHIEF EXECUTIVE OFFICER Title: Co-President
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Date: JUNE 12, 1998 Date: 5/24/1998
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EXHIBIT B
DESCRIPTION OF DEPOSIT MATERIALS
Depositor Company Name _________________________________________________________
Account Number _________________________________________________________________
PRODUCT DESCRIPTION:
Product Name _______________________________ Version ______________________
Operating System _______________________________________________________________
________________________________________________________________________________
Hardware Platform ______________________________________________________________
________________________________________________________________________________
DEPOSIT COPYING INFORMATION:
Hardware required:______________________________________________________________
________________________________________________________________________________
Software required:______________________________________________________________
________________________________________________________________________________
DEPOSIT MATERIAL DESCRIPTION:
Qty Media Type & Size Label Description of Each Separate Item
(excluding documentation)
___ Disk 3.5" or ___
___ DAT tape __mm
___ CD-ROM
___ Data cartridge tape ___
___ TK 70 or ___ tape
___ Magnetic tape ___
___ Documentation
___ Other ____________________________
I certify for Depositor that the above DSI has inspected and accepted the
described deposit materials have been above materials (any exceptions are
transmitted to DSI: noted above):
Auckland UniServices Limited Data Securities International, Inc.
Signature__________________________ Signature__________________________
Print Name_________________________ Print Name_________________________
Date_______________________________ Date Accepted:_____________________
Exhibit B#_________________________
Send materials to: DSI, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇. #▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Escrow Annual Fees
Account Additional
First Renewal Beneficiary
Protection System Year Years or Depositor
----------------- ---- ----- ------------
Preferred $2,300 $1,300 $ n/a
Master Preferred-Depositor 3,300 1,300 650
Master Preferred-Beneficiary 3,300 1,300 1,300
Comprehensive Preferred 3,100 2,100 1,450
FlexSAFE 1,500 1,200 200
SAFE 1,500 1,200 50
Technology Protection (POST) 650 650 n/a
1. Included Services
Administrative services and protection vary depending on the system
selected. Please consult with your DSI representative to ensure that you
are utilizing the agreement which best suits your needs.
2. Custom Agreements
A $500 customization fee will be added to the first year when contract
changes increase DSI's risk or modify our release, termination or update
processes.
3. Preferred Discounts
Preferred fees will be discounted $650/year when the deposit materials are
held in an existing DSI escrow account.
4. Additional Protection Systems
Preferred or Comprehensive Preferred $1,000
Master Preferred 2,000
SAFE or FlexSAFE 300
SERVICE OPTIONS
Unlimited deposit updates/replacements + one additional
storage unit $300/yr.
Individual deposit updates/replacements $200/ea.
DepositTrack updates $300/ea.
Remote vaulting $500/yr.
Release filing fee *no fee
Additional storage units $100/ea.
Technical verification (estimates based on $150/hr.)
Verification Level I $300-600
Verification Level II (includes Level I) $600-1,200
Verification Level III (includes Levels I and II) $2,400-4,600
* direct expenses in excess of $300 will be chargeable.
AUCKLAND UNISERVICES LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 1997
Consolidated Consolidated Parent Parent Parent
1997 Actual 1996 Actual 1997 Actual 1997 Budget 1996 Actual
$ $ $ $ $
ASSETS
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CURRENT ASSETS
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Cash in Hand and at Bank (Note 11) 4,857,931 5,797,021 4,853,283 5,833,000 5,797,021
Bank Deposits (Note 11) 9,168,827 5,937,362 9,168,827 4,814,206 5,937,361
Accounts Receivable 2,583,569 2,520,444 2,583,569 3,227,833 2,520,444
Provisions for Doubtful Debts (45,000) (45,000) (45,000) (45,000) (45,000)
Work in Progress 3,718,537 1,321,573 3,718,537 1,119,775 1,321,573
Sundry Debtors 82,322 160,727 32,662 25,749 160,727
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TOTAL CURRENT ASSETS 20,366,186 15,692,127 20,311,878 14,975,563 15,692,126
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NON-CURRENT ASSETS
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Fixed Assets (Note 3) 478,956 587,440 478,956 422,023 587,440
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Investments (Note 6)
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Advance to Associate Company 39,703 107,932 39,703 67,872 107,932
Investment in Associate Companies 14,472 14,896 14,472 45,683 14,896
Loan to Subsidiary Company (Note 4) 0 0 880,145 0 0
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54,175 122,828 934,320 113,555 122,828
Intangible Assets
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Development Costs (Note 7) 635,984 171,778 75,057 206,563 171,778
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635,984 171,778 75,057 206,563 171,778
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TOTAL NON-CURRENT ASSETS 1,169,115 882,046 1,488,333 742,141 882,046
------------------------
------------------------------------------------------------------------
TOTAL ASSETS 21,535,301 16,574,173 21,800,211 15,717,704 16,574,173
------------ ------------------------------------------------------------------------
CURRENT LIABILITIES
-------------------
Bank Overdraft (Note 11) 169,880 13,452 169,880 12,206 13,452
Trade Creditors 712,625 658,784 676,625 154,898 658,784
Advance ▇▇▇▇▇▇▇▇ 16,626,909 12,931,602 16,626,909 12,306,305 12,931,602
Consultant Creditors 1,202,946 779,350 1,202,946 837,570 779,350
Sundry Creditors 348,878 284,419 348,878 323,742 264,351
Employee Entitlements 183,895 144,208 183,895 64,909 144,208
NeuronZ Current Account (Note 4) 0 226,998 0 0 226,998
Pacific Enzymes Current Account 28,488 0 28,488 0 0
The University of Auckland Current Account
(Note 4) 13,657 133,585 13,657 77,269 133,585
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TOTAL CURRENT LIABILITIES 19,287,278 15,172,398 19,251,278 13,776,699 15,152,330
SHAREHOLDERS' FUNDS
Authorised, Issued and Paid Up Capital
200,100 Ordinary $1 Shares
Fully paid 200,100 200,100 200,100 200,100 200,100
Revenue Reserves
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Retained Earnings 2,047,923 1,201,675 2,348,833 1,740,905 1,221,743
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Shareholder's Funds 2,248,023 1,401,775 2,548,933 1,941,005 1,421,843
------------------- -----------------------------------------------------------------------
TOTAL SHAREHOLDER'S FUNDS
-------------------------
ADVANCES AND LIABILITIES 21,535,301 16,574,173 21,800,211 15,217,704 16,574,173
------------------------ -----------------------------------------------------------------------
The notes on pages 9 to 15 form an integral part of these accounts.
On behalf of the Board
/s/ [ILLEGIBLE]
--------------------------- Director
/s/ [ILLEGIBLE]
--------------------------- Director
April 1998
AUCKLAND UNISERVICES LIMITED
STATEMENT OF FINANCIAL PERFORMANCE
FOR THE YEAR ENDED 31 DECEMBER 1997
Consolidated Consolidated Parent Parent Parent
1997 Actual 1996 Actual 1997 Actual 1997 Budget 1996 Actual
$ $ $ $ $
Income
Sales 19,174,407 17,978,480 19,744,204 18,103,380 17,978,480
Royalties 80,713 103,000 80,713 0 103,000
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Total Revenue (Note 5) 19,255,120 18,081,480 19,824,917 18,103,380 18,081,480
Interest 635,227 664,835 635,215 463,000 664,835
Bad Debts Recovered 113 113
Other Income (1,538) 5,263 (1,538) 0 5,263
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Total Operating Income 19,888,922 18,751,578 20,458,707 18,566,380 18,751,578
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Net Surplus Before Tax 846,248 839,510 1,127,090 414,555 859,578
----------------------
After Charging
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Audit Fees 16,000 9,500 12,500 12,000 9,500
Depreciation 203,175 165,893 203,175 305,443 165,893
Amortisation of Development Costs 84,566 146,329 84,566 0 146,329
Amortisation of Set Up Costs 70,091 0 0 0 0
Patent Costs Written Off 0 0 0 0 0
Bad Debts 43,272 5,647 43,272 20,000 5,647
Doubtful Debts 0 0 0 0 0
Equipment Donation to University of Auckland 1,442,748 780,665 1,442,748 828,532 780,665
Directors Fees 0 0 0 0 0
Foreign Exchange Fluctuations 143,484 1,131 134,615 0 1,131
Interest Expense 180,952 202,502 180,952 0 202,502
Operating Lease Costs 24,682 0 24,682 0 0
Rent - Buildings 152,274 0 152,274 70,000 4,547
Share of Associate Company (Deficit)/Surplus (423) (30,787) (423) 0 (30,787)
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Net Surplus After Tax 846,248 839,510 1,127,090 414,555 859,578
---------------------
Retained Earnings 1 January 1997 1,201,675 362,165 1,221,743 1,326,348 362,165
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Retained Earnings 31 December 1997 2,047,923 1,201,675 2,348,833 1,740,903 1,221,743
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The notes on Pages 9 to 15 form an integral part of these accounts.
COMPREHENSIVE PREFERRED AMENDMENT
TO PREFERRED ESCROW AGREEMENT
Account Number ________________________
This document is intended to amend the Preferred Escrow Agreement (the
"Agreement") among the undersigned parties, as follows:
Section 1.6 is replaced with the following:
DSI shall perform a Level One verification of the deposit materials upon the
initial deposit and for each update. A verification determines, in different
levels of detail, the accuracy, completeness, sufficiency and quality of the
deposit materials. A Level One verification is defined as follows: DSI will
cause a technically qualified DSI employee to evaluate the deposit materials in
order to identify (a) the hardware and software configurations reasonably
necessary to maintain the deposit materials, (b) the hardware and software
configurations reasonably necessary to compile the deposit materials, and (c)
the compilation instructions. DSI will then prepare and deliver to Depositor and
Preferred Beneficiary a report describing the information so identified. It
shall be the responsibility of the Depositor, and not DSI, to assure that the
deposit materials contain the information required in the license agreement.
Preferred Beneficiary shall have the right, at Preferred Beneficiary's expense,
to cause higher levels of verification of any deposit materials. If a
verification is elected after the deposit materials have been delivered to DSI,
then only DSI, or at DSI's election an independent person or company selected
and supervised by DSI, may perform the verification.
Section 1.7 is modified to add the following:
DSI shall notify Depositor in writing semi-annually of Depositor's obligation
to make updated deposits. Within 30 days of receipt of each such notice,
Depositor shall certify in writing to DSI that (a) it has made the updated
deposits as required in the immediately preceding paragraph; or (b) there has
not been a release of a new version of the product since the last deposit. After
the 30 days, DSI shall notify Preferred Beneficiary that DSI has received a) an
updated deposit from Depositor, b) a statement from Depositor advising there has
not been a release of a new version of the product since the last deposit, or c)
no response from Depositor.
Except as specifically provided above, the Agreement shall remain in full force
and effect without modification.
AUCKLAND UNISERVICES LIMITED Pacific Title/Mirage, Inc.
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Depositor Preferred Beneficiary
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title: CHIEF EXECUTIVE OFFICER Title: Co-President
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Date: JUNE 12, 1998. Date: 6/12/98
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Data Securities International, Inc.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: VP SALES MARKETING
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Date: 6-12-98
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THIS LETTER IS TO BE TYPED ON THE LETTERHEAD OF UNISERVICES
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(Insert date here)
▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Co-President
Pacific Title/Mirage, Inc.
(Insert remainder of address here)
Subject: UniServices - Pacific Title/Mirage Agreement
effective November 1, 1997
Dear ▇▇▇▇▇▇▇:
This letter is a side-letter to the Technologies License, Development,
Consulting and Collaboration Agreement ("Agreement") between Auckland
UniServices Limited ("UniServices") and Pacific Title/Mirage, Inc. ("Pacific")
effective November 1, 1997. This letter acknowledges the parties' side-agreement
that, as of the date of this letter, Pacific has paid certain moneys and has
agreed to soon pay other moneys pursuant to the Agreement.
More specifically, Pacific has already paid Development Fees (as defined in
Section 4.5 of the Agreement) for five months November 1, 1997 to March 1, 1998,
totaling $62,500, and has already paid certain expenses relating to Consulting
Services (as defined in Section 4.4 of the Agreement) up to April___, 1998,
totaling ____.
In addition, as soon as the Agreement has been executed by both parties,
Pacific has agreed to pay the installments of the Basic Fee (as defined in
Section 3.1 of the Agreement), the installments of the Development Fee (as
defined in Section 4.5 of the Agreement) and the expenses relating to
Consulting Services (as defined in Section 4.4 of the Agreement), all as
identified below. The following is an accounting of the moneys to be paid as
soon as the Agreement has been executed by both parties:
Installments of Basic Fee: $87,500 due upon signing the Agreement, $87,500
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due January 31, 1998, and $87,500 due April 30, 1998, totaling $262,500.
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Installments of Development Fee: $12,500 due April 1, 1998, $12,500 due
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May 1, 1998, and $12,500 due June 1, 1998, totaling $37,500.
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Expenses relating to Consulting Services: $_________ for the time period
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__________ (insert dates here).
Future payments of moneys in U.S. dollars will continue in accordance with
the terms of the Agreement.
To confirm the accuracy of the information in this side-letter, please sign
two copies of this letter. Please retain one signed copy for your file, and
return the other signed copy to me for my file.
If you have any questions, please feel free to contact me.
Very truly yours,
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Ph.D.
Agreed and accepted by:
Pacific Title/Mirage, Inc.
/s/ ▇▇. ▇▇▇▇ ▇▇▇▇▇
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Printed name: ▇▇. ▇▇▇▇ ▇▇▇▇▇
Corporate title: Co-President Pacific Title/Mirage, Inc.
Date: 5/24/1998
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[LETTERHEAD OF ▇▇▇▇▇ & VANDERHYE P.C.]
May 20, 1998
▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇
Data Securities International, Inc.
Subject: Confidentiality Agreement regarding the
UniServices - Pacific Title/Mirage Agreement of
November 1, 1997
Dear ▇▇. ▇▇▇▇▇▇▇:
This letter memorializes your company's agreement to maintain the
confidentiality of the Technologies License, Development, Consulting and
Collaboration Agreement ("Agreement") between Auckland UniServices Limited
("UniServices") and Pacific Title/Mirage, Inc. ("Pacific") effective November 1,
1997, and to not disclose the Agreement or any of its terms to any outside
parties or individuals without the express written permission of both
UniServices and Pacific. As you know, the Agreement will be part of the
Preferred Escrow Agreement concerning these same parties and your company.
To confirm this confidentiality undertaking in writing, please sign three
copies of this letter. Please retain one signed copy for your file and return
the other two signed copies to me so that I can give a signed copy to
UniServices and a signed copy to Pacific.
If you have any questions, please feel free to contact me.
Very truly yours,
▇▇▇▇▇ & VANDERHYE P.C.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇
Agreed and accepted by:
Data Securities International, Inc.
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Printed name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Corporate title: VP SALES & MARKETING
Date: 5-21-98