Exhibit 10.2
LICENSE AND PURCHASE OPTION AGREEMENT
This License and Purchase Option Agreement ("Agreement") is made and entered
into on the 12th day of July, 2005 (the "Effective Date") by and between,
Tarantella, Inc., (including its successors and assigns, "Tarantella"), a
California corporation, with its principal place of business at 100 Albright
Way, Suite D, Los Gatos, California, 95032, and Propalms Limited ("Pro"), a
British corporation, with its place of business at the Propalms Ltd, Sunny Bank,
Acklam Malton, North Yorkshire YO17 9RG
WHEREAS, Tarantella is a developer and distributor of a Tarantella software
product known as "Terminal Services Edition" or "TSE" (hereafter the "Licensed
Product" as more fully described in Exhibit A attached hereto);
WHEREAS, Pro is in the business of software IP ownership, providing commercial
systems and software application integration, and the distribution and sale of
software;
WHEREAS, Pro wishes to license the Licensed Product, and Tarantella is willing
to license the Licensed Product, subject to and in accordance with the terms of
this Agreement; and
WHEREAS, Pro is entitled to exercise an option to purchase the Licensed Product
and all associated IP (other than the associated patents and marks which are not
unique to the Licensed Product, if any) per the terms of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants contained in this
Agreement, the adequacy and sufficiency of which are hereby acknowledged,
Tarantella and Pro agree as follows:
1.0 GRANT OF LICENSE
----------------
1.1 Subject to the terms and conditions of this Agreement,
Tarantella hereby grants to Pro an exclusive (except for the
SCO Distributor Agreement dated March 31, 2000 between
Tarantella (formerly the Santa Cruz Operation) and Tomen
Electronics Corporation (as amended) and the Source Code
License and Localization Agreement dated March 31, 2000
between Tomen and Tarantella (as amended) and any other
licenses that may have been granted prior to the Effective
Date), non-transferable, royalty-free, perpetual, and world
wide right to demonstrate, market, produce, distribute,
license and support the Licensed Product through resellers and
distributors or directly to end users. Tarantella also grants
a non-transferable, royalty-free, perpetual, and global
license to Pro to use the TSE trademark in connection with the
Licensed Products.
1.2 Tarantella also grants a personal, non-transferable,
royalty-free, perpetual, exclusive (other than with respect to
the TSE Patents which shall be non-exclusive and the Source
Code License with Tomen) and global license under Tarantella's
IP to Pro to use the Licensed Product's source code ("Source
Code"), including for the creation of derivative works;
provided that Pro may not (a) assign, sublicense or otherwise
transfer the Source Code (including any source code associated
with a derivative work) and its related intellectual property
(hereafter "IP" as defined below) rights in any way and (b)
subject to subparagraph (a), Pro shall own any derivative work
that it creates. Any such assignment of the Source Code
(including any source code associated with a derivative
works), sublicense or transfer shall be null and void.
"Intellectual Property" or "IP" shall mean any or all of the
following and all worldwide rights therein, arising therefrom,
or associated therewith which are owned by Tarantella as of
the Effective Date: (i) patents (including all improvement
patents, enhancements and other modifications) (collectively,
the TSE Patents"), (ii) inventions (whether patentable or
not), invention disclosures, improvements, trade secrets,
proprietary information, know how, processes, technology,
technical data and customer lists, (iii) copyrights, copyright
registrations and applications therefor and all other rights
corresponding thereto throughout the world, (iv) computer
software, including all source code, object code, firmware,
development tools, files, records and data, all media on which
any of the foregoing is recorded, all Web addresses, sites and
domain names, (v) industrial designs and any registrations and
applications therefor throughout the world, (vi) trade names,
logos, common law trademarks and service marks, trademark and
service mark registrations and applications therefor and all
goodwill associated therewith throughout the world, (vii)
databases and data collections and all rights therein
throughout the world, (viii) processes, devices, prototypes,
schematics, test methodologies, and development tools, (ix)
any similar, corresponding or equivalent rights to any of the
foregoing and (x) documentation related to any of the
foregoing.
1.3 Except as specifically set forth in Sections 1.1 and 1.2
hereof and subject to Section 14, Pro shall have no other
rights, and no such rights shall be granted in the Licensed
Products and the IP related to, or in connection with, the
Licensed Product (the "TSE IP"). Subject to Section 14,
ownership of the Licensed Product, and except as specifically
set forth in Sections 1.1 and 1.2, all TSE IP are and shall at
all times be retained by Tarantella including the right to
enforce all rights associated with the TSE IP provided, that
for the term of this Agreement Tarantella shall have no right
to use the TSE IP for commercial purposes or to create and to
demonstrate, market, produce, distribute, sell, license,
support or otherwise use any such derivative works created by
Tarantella (or its assignees). The parties agree and
acknowledge that notwithstanding the foregoing, Tarentella
(and its successors and assigns) are permitted to make use of
the TSE Patents for licensing activities arising out of
suspected infringement or broad based cross licensing
activities.
1.4 The grant of license in this Section 1 does not contemplate or
include the transfer of the remote data protocol ("RDP")
license or license to the Detours Library from the Microsoft
Corporation ("Microsoft"). Pro acknowledges the need for an
RDP license to as well as a Detours License to enable the
Licensed Product and agrees that it shall be solely
responsible for acquiring any such license directly from
Microsoft.
2.0 ASSIGNED AGREEMENTS
-------------------
Subject to the terms and conditions of this Agreement, Tarantella
hereby assigns and delivers to Pro all of its right, title, and
interest in, to and under various agreements regarding the Licensed
Product, including any click-through licenses (the "Assigned
Agreements"). A list of the Assigned Agreements is attached hereto as
Exhibit B. Pro hereby specifically assumes each of the Assigned
Agreements and agrees to be bound by the terms and conditions of the
Assigned Agreements, including all obligations of Tarantella
thereunder.
3.0 SOFTWARE LICENSE AGREEMENT
--------------------------
Pro shall require its customers to execute or cause to be executed a
license agreement between Pro and any customer containing provisions
substantially similar to those included in the software license
agreement as set forth in Exhibit C. Pro shall provide a copy of any
such license agreement prior to its use and any such license agreement
shall be subject to the approval of Tarantella, which approval shall
not be unreasonably withheld or delayed.
4.0 SUPPORT AND MAINTENANCE OF LICENSED PRODUCT
-------------------------------------------
4.1 Pro agrees that it shall be solely responsible for and shall
provide, at a minimum, to Tarantella's current Licensed
Product customers, support and maintenance services in
accordance with the relevant Assigned Agreements. Such support
and maintenance services consist of technical assistance via
telephone or e-mail and upgrades and updates to the Licensed
Product if and when they become available as more specifically
described in the relevant Assigned Agreements.
4.2 After the current term of any agreement or commitment to
provide support and maintenance by Tarantella to a Licensed
Product customer expires or is otherwise terminated, and to
the extent that Pro elects to continue to provide such support
and maintenance, Pro shall enter into new agreements or
commitments that are solely between Pro and any such
customers.
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4.3 Tarantella will prepare a letter to all current TSE customers
informing them of this Agreement and that various rights of
the TSE product have been purchased by Pro. This letter will
be attached as Exhibit E to this Agreement.
4.4 Tarentella shall provide Pro with the names of the TSE
developers and support team personnel.
5.0 MARKETING
---------
5.1 Tarantella shall provide to Pro a master copy or make
available for web download, all available marketing materials,
spec or data sheets, brochures, presentations, relevant sales
tools, and any similar materials related to the Licensed
Products. Pro shall have the right to use such materials,
subject to the terms of this Agreement. Pro may modify or
re-brand such materials as it sees fit but only to the extent
not otherwise in breach of the terms of this Agreement.
5.2 Pro and Tarentella shall issue a mutually agreeable press
regarding this Agreement within seven (7) days .
6.0 PRICING AND PAYMENT
-------------------
6.1 Pro shall make payments to Tarantella in United States
dollars. Pricing, fees, royalties, and the payment terms are
set forth in Exhibit D.
6.2 Pro shall provide for and bear all costs of Pro production,
development, inventory, stocking, and distribution of the
Licensed Product.
6.3 Pro shall pay for the Licensed Product as set forth in Exhibit
D, which is exclusive of shipping, handling, and any federal,
state, municipal or other governmental taxes, duties,
licenses, fees, excises or tariffs now or hereinafter imposed
on the production, storage, licensing, sale, transportation,
import, export or use of Licensed Products. Pro agrees to pay
such charges or, in lieu thereof, Pro shall provide an
exemption certificate acceptable to Tarantella and the
applicable taxing authority. Tarantella, however, shall be
responsible for all taxes based upon its net income.
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7. TERM OF AGREEMENT; OBLIGATIONS UPON TERMINATION
-----------------------------------------------
7.1 This Agreement shall be in effect from the Effective Date and
will continue thereafter until terminated in accordance with
the terms of this Agreement.
7.2 Should either party materially breach any provision of this
Agreement, and fail to remedy such breach within thirty (30)
days of written notice thereof, the injured party may
terminate this Agreement, as well as pursue any other rights
and remedies provided by law or equity. Upon such termination,
Pro shall cease any and all use, sale or distribution of the
Licensed Product (including any derivative works); provided
that any such termination shall not affect any customer
licenses of the Licensed Products properly acquired hereunder
prior to the effective date of such termination.
8.0 WARRANTY
--------
8.1 Tarantella does not warrant that the Licensed Products will
meet Pro requirements or that its operation will be
uninterrupted or error free. Tarantella warrants that the
reproduction of the software on the media material provided by
Tarantella is correct in all material ways.
8.2. Tarantella warrants that it has provided Pro all the
information relating to any licensing of the TSE product.
Tarantella also warrants that unless specified within this
Agreement there are no lawsuits or any legal actions pending
with the TSE product
8.3 EXCEPT AS SPECIFICALLY PROVIDED IN SECTION 8.1 and 8.2,
LICENSED PRODUCTS ARE PROVIDED "AS IS" WITHOUT WARRANTY OF ANY
KIND, EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED
TO, THE IMPLIED WARRANTIES OF TITLE, NON-INFRINGEMENT,
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
8.4 TARANTELLA MAKES NO WARRANTIES OF ANY KIND, EXPRESSED OR
IMPLIED, WITH RESPECT TO ANY THIRD PARTY OR OPEN SOURCE
TECHNOLOGY THAT MAY BE INCLUDED IN OR WITH THE LICENSED
PRODUCT, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES
OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE.
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8.5 TARANTELLA MAKES NO WARRANTY DIRECTLY TO PRO END USER
CUSTOMERS AND NO SUCH CUSTOMER SHALL HAVE ANY THIRD PARTY
RIGHTS AGAINST TARANTELLA.
9.0 LIMITATION OF LIABILITY
-----------------------
9.1 NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR INDIRECT,
SPECIAL, PUNITIVE, INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY
KIND SUSTAINED OR INCURRED IN CONNECTION WITH THIS AGREEMENT
AND THE SOFTWARE THAT IS SUBJECT TO THIS AGREEMENT REGARDLESS
OF THE FORM OF ACTION AND WHETHER OR NOT SUCH DAMAGES ARE
FORESEEABLE, AND EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH LOSS. IN NO CASE WILL TARANTELLA BE LIABLE
FOR ANY REPRESENTATION OR WARRANTY MADE TO ANY THIRD PARTY BY
PRO OR ANY AGENT OF PRO OTHER THAN THOSE WARRANTIES PERMITTED
HEREIN.
9.2 WITH THE EXCEPTION OF THE INDEMNIFICATION OF BOTH PARTIES AS
SET FORTH BELOW, IN NO EVENT SHALL TARANTELLA'S LIABILITY
UNDER OR ARISING OUT OF THIS AGREEMENT EXCEED THE SUM OF
MONIES RECEIVED BY TARANTELLA FROM PRO UNDER THIS AGREEMENT.
10.0 INDEMNIFICATION
---------------
10.1 Tarantella agrees to indemnify, defend and hold PRO and its
resellers, distributors, customers and other third parties
(collectively, "Indemnitees") harmless from any and all
damages, liabilities, costs and expenses (including expenses
and attorney's fees) incurred by such Indemnitees as a result
of any claim, judgment or adjudication against such
Indemnitees alleging that the Licensed Products, other
materials provided by Tarantella hereunder, trade names or the
marks used as permitted hereunder infringe or misappropriate
any U.S. trademark, trade secret, copyright, patent or other
proprietary right of any third party, provided: (i) the
Indemnitee promptly notifies Tarantella in writing of the
claim; and (ii) the Indemnitee agrees that Tarantella will
have the sole control of any action and all negotiations for
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settlement and compromise. Notwithstanding the foregoing,
Tarantella shall have no obligation or liability under this
Section 10.1 for any infringement claim resulting from
modifications to the Licensed Products not made by Tarantella,
use of the Licensed Products in any manner not expressly
permitted hereunder, or the combination of the Licensed
Products with any product or software not provided by
Tarantella, if such infringement would not have occurred but
for such modifications, misuse or combination. The obligations
contained in this Section 10.1 shall expire on the earlier of:
a) termination of this Agreement for a material breach of Pro;
b) December 31, 2007 or c) the expenditure by Tarantella for
the discharge of its obligations under this Section 10.1 of
more than $1,000,000.
10.2 Should the Licensed Products, or the operation of the Licensed
Products, become, or in Tarantella's opinion be likely to
become, the subject of infringement of any trademark,
copyright or patent, Pro agrees to permit Tarantella, at
Tarantella's option and expense, either to procure for Pro the
right to continue using the Licensed Products, or to replace
or modify the Licensed Products so that they become
non-infringing. If Tarantella determines that neither of the
foregoing options are feasible, then Tarantella shall accept
return of all of the affected Licensed Product(s) and refund
to Pro all amounts paid hereunder for such Licensed
Product(s), depreciated on a straight-line method using a
useful life of five (5) years.
10.3 .
10.4 THE ABOVE CLAUSE 10.1 and 10,2 STATES THE ENTIRE LIABILITY OF
TARANTELLA WITH RESPECT TO INFRINGEMENT OF PATENTS,
COPYRIGHTS, TRADEMARKS OR ANY OTHER FORM OF INTELLECTUAL
PROPERTY RIGHT BY ANY LICENSED PRODUCT SUPPLIED BY PRO.
10.5 Pro agrees to indemnify, defend and hold Tarantella harmless
from any and all damages, liabilities, costs and expenses
(including expenses and attorney's fees) incurred as a result
of any claim, judgment or adjudication against Tarantella (a)
alleging that any derivative work of the Licensed Product by
Pro infringe or misappropriate any trademark, trade secret,
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copyright, patent or other proprietary right of any third
party, (b) alleging any breach of the terms of any of the
Assigned Agreements or (c) alleging any breach of the
obligation to provide support and maintenance as contemplated
in Section 4.0; provided, that in any such circumstance, (i)
Tarantella promptly notifies Pro in writing of the claim; and
(ii) Tarantella agrees that Pro will have the sole control of
any action and all negotiations for settlement and compromise.
11.0 RESTRICTED RIGHTS LEGEND
------------------------
When licensed to the U.S., State, or Local Government, the Licensed
Product and software documentation distributed by Pro is commercial
software or documentation as defined in Federal Acquisition Regulation
clause 12.212, and has been developed exclusively at private expense.
If Licensed Product or software documentation is acquired by or on the
behalf of the U.S. Government or a U.S. Government prime contractor or
subcontractor (at any tier), the U.S. Government's rights in the
Licensed Software or technical data is as set forth in this Agreement;
this is in accordance with 48 CFR 227.7201 through 227.7202-4 (for
Department of Defense (DoD) acquisitions) and with 48 CFR 2.101 and
12.212 (non-DoD acquisitions). All Licensed Product or software
documentation acquired by the State or Local Government said computer
software/documentation shall be acquired under the licenses customarily
provided to the general public. Manufacturer: Tarantella, Inc., 100
Albright Way, Suite D, Los Gatos, California 95032.
12.0 EXPORT CONTROL
--------------
Pro shall comply with all applicable Federal, state and local laws,
ordinances, codes, rules and regulations in the performance of this
Agreement, including, without limitation, Federal Communications
Commission Regulations, U.S. Department of Commerce Export Regulations,
and U.S. Treasury-U.S. Customs Regulations.
13.0 PATENT, COPYRIGHT AND TRADEMARK RIGHTS
--------------------------------------
13.1 In the event that Pro uses the name of the Licensed Products
or the "TSE" trademark in any of its advertising,
publications, packaging, external or other communications of
any kind, ,Pro shall cause to appear the appropriate
proprietary designations and notices for the Licensed
Products, including, all necessary, copyright, trademark,
service mark and patent notices. At a minimum, the appropriate
trademark symbol must be used at least once for each Licensed
Product in accordance with standard trademark practices.
13.2 Pro agrees not to assert any patent rights related to any
Intellectual Property rights licensed or transferred under
this Agreement against Tarantella (and its successors and
assigns), its affiliates, customers, distributors or other
licensees for making, using, selling, offering for sale, or
importing any products which implement, use or incorporate any
such Intellectual Property rights licensed or transferred
under this Agreement.
14.0 RIGHT TO PURCHASE
-----------------
At anytime after the Maximum Amount has been paid by Pro, or Tarantella
decides in its sole discretion to sell the TSE IP (other than the TSE
Patents), but in no event later than 31st December, 2007, Pro shall
have the right to purchase the TSE IP (other than the TSE Patents) for
$1.00 and on such other terms and conditions as may be agreed in good
faith between the parties in their reasonable discretion. Once the
Maximum Amount has been paid and the TSE IP rights (other than the TSE
Patents) have been transferred, the Agreement shall be terminated.
15.0 CONFIDENTIALITY
---------------
15.1 Each party shall at all times retain in confidence all
confidential and/or proprietary information and know-how
disclosed or made available by the other. The recipient shall
make no use of such information and know-how except under the
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terms and for the duration of this Agreement (or thereafter as
necessary to exercise its rights that continue beyond
termination hereof). The parties hereby agree that all the
terms and conditions of this Agreement and exhibits hereto,
shall be treated as confidential material and shall not be
disclosed without the prior written consent of the disclosing
party.
15.2 Confidential and/or proprietary information shall not include
information the recipient can document: (a) is in or (through
no improper action or inaction by the recipient) enters the
public domain; (b) was rightfully in its possession or known
by it prior to receipt from the disclosing party; (c) was
rightfully disclosed to it by another person without
restriction; or (d) was independently developed by it by
persons without access to such information and without use of
any confidential and/or proprietary information of the
disclosing party.
15.3 Each party, with prior written notice to the disclosing party,
may disclose confidential and/or proprietary information to
the minimum extent possible that is required to be disclosed
pursuant to the lawful requirement or request of a government
entity or agency, provided that reasonable measures are taken
to guard against further disclosures, including without
limitation, seeking appropriate confidential treatment or a
protective order, or assisting the other party to do so.
15.4 Each party understands that the other party may develop or
receive information similar to the confidential information.
Subject to copyrights and patent rights of each party, (i)
either party may develop or acquire technology or products,
for itself or others, that are similar to or competitive with
the technology or products of the disclosing party, and (ii)
each party is free to use information which may be retained in
the unaided memory of the receiving party's employees or
contractors who have had access to the confidential
information of the other party disclosed hereunder (including,
in this context, engineers who may have had access to the
Licensed Product Source code prior to the Effective Date).
16.0 ASSIGNMENT OF RIGHTS
--------------------
Neither party may assign this Agreement without the prior written
consent of the other party, which consent shall not be unreasonably
withheld or delayed. Notwithstanding the foregoing, Tarantella may
assign this Agreement without consent or restriction to any party
acquiring Tarantella, or all, or substantially all of its assets.
Tarantella shall use commercially reasonable efforts to provide Pro
with notice of any such assignment. This Agreement if properly assigned
shall be binding upon and inure to the benefit of the parties hereto,
their successors, administrators, heirs and assigns.
17.0 CONTROLLING LAW
---------------
This Agreement and the licenses granted under it shall be governed by
and construed in accordance with the laws of the State of California,
excluding its conflict of law provisions thereof, and the parties
hereby consent to the exclusive jurisdiction of the California courts.
The UN Convention for the International Sale of Goods shall not apply.
18.0 SEVERABILITY
------------
If any provision or provisions of this Agreement shall be held to be
invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be
affected or impaired thereby. The parties will seek in good faith to
agree on the replacement of any invalid, illegal, or unenforceable
provision with a valid, legal, and enforceable provision which, in
effect, will, from an economic or substantive viewpoint, most nearly
and fairly approach the effect of the invalid, illegal, or
unenforceable provision.
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19.0 ACTS BEYOND PARTIES' CONTROL
----------------------------
Neither party shall be liable for any delay or failure in its
performance hereunder due to any cause beyond its reasonable control;
provided, however, that this provision shall not be construed to
relieve Pro of its obligation to make any payments pursuant to this
Agreement.
20.0 BINDING EFFECT
--------------
Subject to the limitations herein expressed, this Agreement will
benefit and be binding upon the parties, their successors,
administrators, heirs and assigns.
21.0 THE PARTIES AS INDEPENDENT CONTRACTORS
--------------------------------------
The parties shall at all times be independent contractors and shall so
represent themselves to all other parties. No party has granted to the
other the right to bind it in any manner or thing whatsoever and
nothing herein shall be deemed to constitute a partnership, to make one
party the agent or legal representative of the other, nor to constitute
the parties as joint venturers.
22.0 WAIVER
------
The waiver of one breach or default hereunder shall not constitute the
waiver of any subsequent breach or default.
23.0 REPRESENTATION AND WARRANTIES
-----------------------------
Each party represents and warrants that (a) it has all requisite
corporate power and authority to execute, deliver, and perform this
Agreement and (b) the execution and delivery by it, the consummation of
the transactions contemplated hereby and the performance by it of its
obligations hereunder have been duly and validly authorized by all
necessary corporate action.
24.0 ENTIRE AGREEMENT
----------------
This Agreement constitutes the entire agreement between Pro and
Tarantella regarding the subject matter hereof and supersedes all
previous negotiations, proposals, commitments, writings,
advertisements, and understandings of any nature whatsoever. This
Agreement may be modified only in writing executed by an authorized
representative of each party. Any terms set forth on any purchase order
or other document related hereto which are submitted to or sent by
either party and which are in conflict with or in addition to the terms
of this Agreement shall be null and void.
25.0 SURVIVAL OF PROVISIONS
----------------------
The provisions of this Agreement that by their nature extend beyond the
applicable expiration date or other termination of this Agreement will
survive and remain in effect until all obligations are satisfied.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
Effective Date.
TARANTELLA, INC. PROPALMS LTD.
By: ______________________________ By: _______________________________
Name: ____________________________ Name: _____________________________
Title: ___________________________ Title: ____________________________
Date: ___________________________ Date: ____________________________
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EXHIBIT A
LICENSED PRODUCT DESCRIPTION
1. The Licensed Product is described as follows:
Secure Global Desktop Terminal Services Edition (TSE)
Versions :
V.2.1
V.4.0
License Generator for Keys for the above versions