Exhibit 10.13
ISES CORPORATION
2600 72nd Street, Suite C
W. Des Moines, Iowa 50322
Tel: (515) 331-0560 Fax: (515) 331-3901
("ISES")
IN-FLIGHT ENTERTAINMENT SOFTWARE LICENSE AGREEMENT
Customer: Delta Air Lines, Inc.
Department 916
1020 Delta Blvd.
Atlanta, GA 30320-6001
Tel: 404-715-2835Fax: 404-715-5100
Contact: K. Allen Greer
ISES hereby grants Customer, and Customer hereby accepts from ISES, a
non-exclusive and non-transferable right to use the computer programs described
in Section 1 below (the "Products") on the designated hardware described in
Section 2 below (the "Designated Hardware"), for the term specified herein,
subject to the terms and conditions specified below.
GENERAL TERMS AND CONDITIONS
1. PRODUCTS
"Products" means (i) the machine-readable object code version of the computer
programs described in the Product Schedule, whether embedded on disc, tape or
other media, for use on the computer platform specified in the Product Schedule
(the "Software"), (ii) the published user manuals and documentation that ISES
makes generally available for the Software (the "Documentation"), (iii) the
fixes, updates, upgrades or new versions of the Software or Documentation that
ISES may provide to Customer under this Agreement (the "Enhancements") and (iv)
any copy of the Software, Documentation or Enhancements. Nothing in this
Agreement will entitle Customer to receive the source code of the Software or
Enhancements, in whole or in part.
2. DESIGNATED HARDWARE
"Designated Hardware" means the hardware equipment installed in the designated
aircraft, each as specified in the Product Schedule. Customer may use the
Products as described in Section 3 only on the Designated Hardware while it
possesses and operates the Designated Hardware. Any other use or transfer of the
Products will require ISES's prior written approval, which (i) shall not be
unreasonably withheld or delayed and (ii) may be subject to additional charges
should any revision to the Products be required as a result of the alternative
use or transfer.
3. USE
Customer may use the Products only in and for Customer's own internal purposes
in providing in-flight entertainment to its passengers. Customer will not permit
any other person to use the Products, whether on a time-sharing or other
multiple user arrangement. Customer, or their designee, may install the Software
or Enhancements on a network or other multi-user computer system specified in
the Product Schedule and use the Designated Hardware to provide file services to
Customer's in-flight entertainment consoles, up to the number of seats specified
in the Product Schedule. Customer, or their designee, may make a reasonable
number of back-
up archival copies of the Software and Enhancements and will reproduce all
confidentiality and proprietary notices on each of these copies while
maintaining an accurate record of the location of each of these copies. Customer
will not otherwise copy, translate, modify, adapt, decompile, disassemble or
reverse engineer the Products, except as and to the extent expressly authorized
by applicable law or with the prior approval of ISES.
4. PAYMENT
Customer will pay to ISES the License Fee specified in the Product Schedule and
by the date specified in the Product Schedule. The License Fee is based upon the
total number of seats that may access an in-flight entertainment console on the
designated aircraft. Any increase in usage may be subject to additional charges.
All amounts specified in the Product Schedule are exclusive of any applicable
use, sales, service, property or other taxes or contributions, which Customer
will pay in addition to the amount due and payable.
5. SHIPMENT
ISES will, at its own cost, ship the Products from its distribution center to a
mutually agreed third party in the United States, subject to delays beyond
ISES's control. Should Customer desire shipment outside of the United States,
then ISES will select the method of shipment for Customer's account and obtain
all licenses required to export the Products from the country of origin.
Customer shall pay or reimburse ISES for the cost of shipment of the Products to
the port of entry at Customer's country of domicile. Customer will (i) obtain
all licenses required to import the Products into its country of domicile, (ii)
clear the Products through local customs and (iii) pay all customs duties and
other charges assessed on such importations, if applicable. Risk of loss will
pass to Customer upon arrival of the Products at the port of entry in Customer's
country of domicile.
6. MAINTENANCE AND SUPPORT
(a) Maintenance. During the warranty period specified in Section 7(a), ISES will
provide Customer or their designee, at no additional charge, with the fixes and
updates that ISES may make generally available as part of its standard
maintenance services (the "Updates"). ISES will provide updates for the
remainder of the Term (as defined in Section 12(a)) after the Warranty Period
(the "Maintenance Period") while this Agreement is in effect.
(b) "Hot-Line" Support. During the Warranty Period and any Maintenance Period
ISES will provide Customer, or their designee, at no additional charge, with
advice, consultation and assistance to use the Product and diagnose and correct
problems that Customer may encounter (the "Hot-Line Support"). ISES will offer
the Hot-Line Support remotely by telephone, fax or other electronic
communication during its normal business hours. Customer will bear all telephone
and other expenses that it may incur in connection with the Hot-Line Support.
ISES may offer on-site support to Customer at additional charges as defined in
the Product Schedule.
(c) Limitation. The Updates, which mean bug fixes, modifications, variations or
enhancements, to the extent included in a patch or release of the Product which
ISES generally licenses as part of the Product, will not include any upgrade or
new version of the Products that ISES decides, in its sole discretion, to make
generally available to its customer base as a separately priced item. This
Section will not be interpreted to require ISES to (i) develop and release
Enhancements or (ii) customize the Enhancements to operate in conjunction with
any Customer Modification or otherwise satisfy Customers' particular requests.
If an Enhancement replaces the prior version of the Product, Customer will
destroy such prior version upon installing the Enhancement.
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7. WARRANTIES AND REMEDIES
(a) Limited Warranty. ISES warrants that (i) the Software will conform to ISES's
published specifications in effect on the date of delivery, and (ii) the
Software will perform substantially as described in the accompanying
Documentation for the earlier of one hundred eighty (180) days from the initial
installation of the Product on the Delta "test" aircraft or upon first
installation of the Delta approved Rockwell system on Delta aircraft designated
for "commercial" use, and (iii) from the date of delivery of the Product by ISES
until December 31, 2000, the Products will record, store, process and present
calendar dates falling on or after December 31, 1999 in the same manner and with
substantially the same functionality as such Products record, store, process and
present calendar dates falling before December 31, 1999, (iv) it will perform
any maintenance and support services pursuant to Section 6 with reasonable care
and skill. Customer acknowledges that (i) the Products may not satisfy all of
Customer's requirements, (ii) the use of the Products may not be uninterrupted
or error-free and (iii) this limited warranty will be not apply in case of any
Customer Modifications. Customer further acknowledges that (i) the License Fee
and other charges contemplated under this Agreement are based on the limited
warranty, disclaimers and limitation of liability specified in Sections 7, 8 and
9 and (ii) such charges would be substantially higher if any of these provisions
were unenforceable.
(b) Remedies. In case of breach of warranty or any other duty related to the
quality of the Products, ISES or its representative will, at its own cost,
promptly correct or replace any defective Software or, if not practicable, ISES
will accept the return of the defective Software and refund to Customer (i) the
amount actually paid to ISES for the defective Software, less depreciation based
on a 5-year straight line depreciation schedule, and (ii) a pro rata share of
any maintenance fees that Customer actually paid to ISES for the period that
such Software was not usable. Customer acknowledges that this Paragraph sets
forth Customer's exclusive remedy, and ISES's exclusive liability, for any
breach of warranty or other duty related to the quality of the Products.
(c) Limitations. The warranty provided in this Section 7 will not apply to the
extent that the breach of warranty or Product defect is not brought to the
attention of ISES during the applicable warranty period or arises as a result of
(i) failure to properly install or use the Product in accordance with its
documentation, (ii) failure of the operating environment or hardware failure,
(iii) modification of the Products other than by ISES, or their designee,
without prior written approval by ISES, (iv) failure to promptly install an
Update provided to the Customer or their designee by ISES that would have
eliminated the defect, (v) use of the Products with ambiguous date related data
or in a Year 2000 non-compliant operating environment or (vi) the combination of
the Products with other items not provided by ISES and/or approved by Delta's
system integrator but only if the breach would not have occurred from use of the
Product alone with the Designated Hardware existing as of the date of this
Agreement.
(d) Disclaimer. EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, ALL WARRANTIES,
CONDITIONS, REPRESENTATIONS, INDEMNITIES AND GUARANTEES WITH RESPECT TO THE
PRODUCTS, WHETHER EXPRESS OR IMPLIED, ARISING BY LAW, CUSTOM, PRIOR ORAL OR
WRITTEN STATEMENTS BY ISES, ITS AGENTS OR OTHERWISE (INCLUDING, BUT NOT LIMITED
TO ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR PARTICULAR PURPOSE, SATISFACTORY
QUALITY AND NON-INFRINGEMENT) ARE HEREBY OVERRIDDEN, EXCLUDED AND DISCLAIMED.
8. INDEMNITY
(a) Indemnity. If an action is brought against Customer claiming that a Product
infringes a presently issued U.S. patent, or a copyright or trade secret, ISES
will defend Customer at ISES's expense and, subject to this Section and Section
9, pay the damages and costs finally awarded against customer in the
infringement action, but only
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if (i) Customer notifies ISES promptly upon learning that the claim might be
asserted, (ii) ISES has sole control over the defense of the claim and any
negotiation for its settlement or compromise and (iii) Customer provides ISES
with full cooperation in the investigation, defense and settlement of such claim
as ISES may reasonably require, providing that Customer shall be reimbursed all
of its reasonable out of pocket expenses incurred as a result.
(b) Alternative Remedy. If a claim described in Section 8(a) may be or has been
asserted, Customer will permit ISES, at ISES's option and expense, to (i)
procure the right to continue using the Product, (ii) replace or modify the
Product to eliminate the infringement while providing functionally equivalent
performance or only if the remedies specified in (i) and (ii) are unavailable to
ISES on commercially reasonable terms, (iii) accept the return of the Product
and refund to Customer the amount actually paid to ISES for such Product, less
depreciation based on a 5-year straight-line depreciation schedule and a pro
rata share of any maintenance fees that Customer actually paid to ISES for the
period that such Product was not usable.
(c) Limitation. ISES shall have no indemnity obligation to Customer under this
Section if the infringement claim results from (i) a correction or modification
of the Product not provided by ISES, such as a Customer Modification, (ii) the
failure to promptly install an Update provided to Customer by ISES or (iii) the
combination of the Product with other items not provided by ISES, unless the
infringement would have occurred from use of the Product alone.
9. NO CONSEQUENTIAL DAMAGES
UNDER NO CIRCUMSTANCES WILL ISES OR ITS LICENSORS BE LIABLE FOR ANY
CONSEQUENTIAL, INDIRECT, SPECIAL, PUNITIVE OR INCIDENTAL DAMAGES OR LOST
PROFITS, WHETHER FORESEEABLE OR UNFORESEEABLE, BASED ON CUSTOMER'S CLAIMS OR
THOSE OF ITS PASSENGERS (INCLUDING, BUT NOT LIMITED TO, CLAIMS FOR LOSS OF DATA,
GOODWILL, USE OF MONEY OR USE OF THE PRODUCTS, INTERRUPTION IN USE OR
AVAILABILITY OF DATA, STOPPAGE OF OTHER WORK OR IMPAIRMENT OF OTHER ASSETS OR
EQUIPMENT), ARISING OUT OF BREACH OR FAILURE OF EXPRESS OR IMPLIED WARRANTY,
BREACH OF CONTRACT, MISREPRESENTATION, NEGLIGENCE, STRICT LIABILITY IN TORT OR
OTHERWISE. IN NO EVENT WILL THE AGGREGATE LIABILITY WHICH ISES OR ITS LICENSORS
MAY INCUR IN ANY ACTION OR PROCEEDING EXCEED THE TOTAL AMOUNT ACTUALLY PAID BY
CUSTOMER FOR THE SPECIFIC PRODUCT THAT DIRECTLY CAUSED THE DAMAGE. THIS SECTION
WILL NOT APPLY ONLY WHEN AND TO THE EXTENT THAT APPLICABLE LAW SPECIFICALLY
REQUIRES LIABILITY, DESPITE THE FOREGOING EXCLUSION AND LIMITATION.
10. OWNERSHIP
All trademarks, service marks, patents, copyrights, trade secrets and other
proprietary rights in or related to the Products are and will remain the
exclusive property of ISES or its licensors, whether or not specifically
recognized or perfected under applicable law. Customer will not take any action
that jeopardizes ISES's or its licensor's proprietary rights or acquire any
right in the Products, except the limited use rights specified in Section 3.
ISES or its licensor will own all rights in any copy, translation, modification,
adaptation or derivation of the Products, including any Customer Modification or
other improvement or development of the Products. Customer will obtain, at
ISES's reasonable request and expense, the execution of any instrument that may
be appropriate to assign these rights to ISES or its designee or perfect these
rights in ISES's or its licensor's name.
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11. CONFIDENTIALITY
(a) Confidentiality. Customer acknowledges that the Products incorporate
confidential and proprietary information developed or acquired by or licensed to
ISES. Customer will take all reasonable precautions necessary to safeguard the
confidentiality of the Products, including (i) those taken by Customer to
protect Customer's own confidential information and (ii) those which ISES or its
authorized representative may reasonably request from time to time. Customer
will not allow the removal or defacement of any confidentiality or proprietary
notice placed on the Products. The placement of copyright notices on these items
will not constitute publication or otherwise impair their confidential nature.
(b) Disclosure. Customer will not disclose, in whole or in part, any item of the
Products that has been designated as confidential to any individual, entity or
other person, except (i) to those of Customer's employees or consultants who
require access for Customer's authorized use of the Products and agree to comply
with the use and non-disclosure restrictions applicable to the Products under
this Agreement. Customer shall cause any employee or consultant who has access
to the source code of the Software to expressly acknowledge its confidential and
proprietary nature. Customer acknowledges that any unauthorized use or
disclosure of the Products may cause irreparable damage to ISES, its licensors
and ISES. If an unauthorized use or disclosure occurs, Customer will immediately
notify ISES and take, at Customer's expense, all steps which may be available to
recover the Products and to prevent their subsequent unauthorized use or
dissemination.
(c) Limitation. Customer will have no confidentiality obligation with respect to
any portion of the Products that (i) Customer knew or independently developed
before receiving the Products under this Agreement, (ii) Customer lawfully
obtained from a third party under no confidentiality obligation or (iii) became
available to the public other than as a result of any act or omission by
Customer or any of Customer's employees or consultants.
12. TERM AND TERMINATION
(a) Term. This agreement will become effective as of the date set forth below
and continue in effect for an initial term of 24 months (the "Term"), unless
otherwise terminated pursuant to Section 12(b) or by ninety (90) days written
notice from either party. The agreement may be extended for an additional
term(s) upon sixty (60) days written notice from Customer and that is mutually
agreeable with ISES.
(b) Termination for Cause. Either party may terminate this Agreement,
immediately upon notice to the other party and without judicial or
administrative resolution, if the other party or any of its employees or agents
breach any term or condition hereof and such breach is not cured within 45 days
after receipt of notice specifying the breach and demanding its cure; provided,
however, that a cure period shall be applicable to a breach of Sections 10 or 11
only if such breach is, in the non-breaching party's opinion, reasonably capable
of cure. This Agreement will terminate automatically if either party becomes
insolvent or enters into bankruptcy, suspension of payments, moratorium,
reorganization or any other proceeding that relates to insolvency or protection
of creditors' rights. Upon the termination of this Agreement for any reason, all
rights granted to Customer hereunder will cease, and Customer will promptly (i)
purge the Software and Enhancements from the Designated Hardware and all of
Customer's other computer systems, storage media and other files, (ii) destroy
the Products and all copies thereof and (iii) deliver to ISES a letter signed by
an officer of Customer which certifies that Customer has complied with these
termination obligations. Upon termination of this Agreement by Customer pursuant
to Section 12(c), ISES shall refund to Customer the pro-rated amount of the
then-paid license fee or maintenance fee for the remaining term of the
Agreement. The provisions of Sections 7, 8, 9, 10, and 11 will survive the
termination of this Agreement.
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13. INSPECTION
During the term of this Agreement, ISES or its representative may, upon
reasonable prior written notice to Customer, inspect the files, computer
processors, equipment, aircraft and facilities of Customer during normal working
hours to verify Customer's compliance with this Agreement. While conducting such
inspection, ISES or its representative will be entitled to copy any item that
Customer may possess in violation of this Agreement.
14. ASSIGNMENT
Customer shall not assign, delegate or otherwise transfer this Agreement or any
of its rights or obligations hereunder without ISES's prior approval.
15. EXPORT CONTROLS
Customer acknowledges that the Products and all related technical information,
documents and materials are subject to export controls under the U.S. Export
Administration Regulations. Customer will (i) comply strictly with all legal
requirements established under these controls, (ii) cooperate fully with ISES in
any official or unofficial audit or inspection that relates to these controls
and (iii) not export, re-export, divert or transfer, directly or indirectly, any
such item or direct products thereof to Cuba, Iran, Iraq, Libya, North Korea,
Sudan, Syria or any country that is embargoed by Executive order, unless
Customer has obtained the prior written authorization of ISES and the U.S.
Commerce Department. Upon notice to Customer, ISES may modify this list to
conform to changes in the U.S. Export Administration Regulations.
16. MISCELLANEOUS
All notices or approvals required or permitted under this Agreement must be
given in writing. Any waiver or modification of this Agreement will not be
effective unless executed in writing and signed by the parties. This Agreement
will bind the parties' successors-in-interest. This Agreement will be governed
by and interpreted in accordance with the laws of the State of Iowa, U.S.A. The
parties hereby exclude application of the U.N. Convention on Contracts for the
International Sale of Goods from this Agreement and any transaction between them
related thereto. If any provision of this Agreement is held to be unenforceable,
in whole or in part, such holding will not affect the validity of the other
provisions of this Agreement, unless either party in good faith deems the
unenforceable provision to be essential, in which case such party may terminate
this Agreement effective immediately upon notice to the other party. Any press
release or other public statement regarding this Agreement shall be mutually
agreed to between the parties. Either party may use the other's name in its
advertising collateral, subject to the prior written approval of the other
party, which shall not be unreasonably withheld or delayed. This Agreement
constitutes the complete and entire statement of all conditions and
representations of the agreement between ISES and Customer with respect to its
subject matter and supersedes all prior writings or understandings.
THIS AGREEMENT IS NOT EFFECTIVE UNTIL SIGNED ON BEHALF OF BOTH PARTIES.
ISES Corporation Delta Air Lines, Inc.
- -------------------------- -----------------------------
("ISES") ("Customer")
By: /S/ By: /S/
---------------------- -------------------------
(Signature) (Signature)
Name: Mark Malinak Name: Valerie Nesbitt
---------------------- ------------------------
Title: V. P. Sales Title: Manager - Corporate
Offices Procurement
---------------------- ------------------------
Date: 4/26/00 Date: 4/26/00
---------------------- -------------------------
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PRODUCT SCHEDULE
Software: ISES Game Package of the following ten ISES games:
1. Solitaire
2. Blackjack
3. Backgammon
4. Trivia
5. Twins Cafe Match game
6. Hangman
7. Othello
8. Tetris(R)
9. Zero G
10. Crossword
Computer Platform: Rockwell Collins TES Core D
Designated Hardware (S/N): Rockwell Collins TES
Per Seat License Fee (includes Maintenance): [Confidential Treatment has been
requested for this portion of this
Exhibit]
================================================================================
AirSoft(TM) Travel Kit Games
================================================================================
Aircraft Seat Quantity Seat / year 10 Games
- ------------------------------------------ -------------------------------------
1-3500 [Confidential Treatment has
- ------------------------------------------ -------------------------------------
3501-4999 been requested for this
- ------------------------------------------ -------------------------------------
5000+ portion of this Exhibit]
- ------------------------------------------ -------------------------------------
- ------------------------------------------ -------------------------------------
Annual License Fee and Maintenance based on the [Confidential Treatment has been
requested for this portion of this Exhibit] seat deployment: [Confidential
Treatment has been requested for this portion of this Exhibit] Note:
[Confidential Treatment has been requested for this portion of this Exhibit]
On-site Engineering Fees: [Confidential Treatment has been requested for this
portion of this Exhibit]
Payment Terms: [Confidential Treatment has been requested for this portion of
this Exhibit]
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Content Updates are subject to [Confidential Treatment has been requested for
this portion of this Exhibit]. Delta is responsible for all [Confidential
Treatment has been requested for this portion of this Exhibit].
Custom Content Services:
1. Background Graphics [Confidential Treatment
2. Card back graphics has been requested
3. Logo graphic on game start up screens for this portion of
4. Trivia package, 500 questions this Exhibit]
5. Crossword, 20 puzzles
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