EXHIBIT 10.1
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PATENT PURCHASE AGREEMENT
This PATENT PURCHASE AGREEMENT (this "AGREEMENT") is entered into on
December 12th , 2005 (the "EFFECTIVE DATE") by and between Stavros Investments
LLC, a Nevada limited liability company, with a registered agent address at
2215-B Renaissance Drive, Suite 5, Las Vegas, NV 89119 ("PURCHASER"), Expand
Beyond Corporation a Delaware corporation, with an office at 750 N. Orleans
Street, Suite 601, Chicago, IL 60610 ("SELLER 1") and Semotus Solutions, Inc., a
Nevada corporation, with an office at 718 University Ave, Suite 202, Los Gatos,
California ("SELLER 2") (Seller 1 and Seller 2, individually and collectively,
"SELLER"). The parties hereby agree as follows:
1. BACKGROUND
1.1 Seller owns certain United States Letters Patents and/or applications for
United States Letters Patents and/or related foreign patents and
applications.
1.2 Seller wishes to sell to Purchaser all right, title and interest in such
patents and applications and the causes of action to sue for infringement
thereof and other enforcement rights.
1.3 Purchaser wishes to purchase from Seller all right, title and interest in
the Assigned Patent Rights (defined below), free and clear of any
restrictions, liens, claims, and encumbrances.
2. DEFINITIONS
"ASSIGNED PATENT RIGHTS" means Patents and the additional rights set forth in
paragraph 4.2.
"ASSIGNMENT AGREEMENTS" means the agreements assigning ownership of the Patents
from the inventors and/or prior owners to Seller.
"DOCKET" means Seller's, or its agents', list or other means of tracking
information relating to the prosecution or maintenance of the Patents throughout
the world, including information relating to deadlines, payments, and filings,
which is current as of the Effective Date.
"EXECUTED ASSIGNMENT" means an executed original of the Assignment of Patent
Rights in EXHIBITS B-1 AND B-2.
"LIST OF PROSECUTION COUNSEL" means the names and addresses of prosecution
counsel who prosecuted the Patents and who are currently handling the Patents.
"PATENTS" means (i) each of the provisional patent applications, patent
applications and patents listed on EXHIBITS A AND B1 AND B2 (as such lists may
be updated based on Purchaser's review of the Deliverables) hereto, (ii) all
patents or patent applications to which any of the foregoing claim priority, and
(iii) all reissues, reexaminations, extensions, continuations, continuations in
part, continuing prosecution applications, and divisions of such patents and
applications; and (iv) foreign counterparts to any of the foregoing, including
certificates of invention, utility models, industrial design protection, design
patent protection,
and other governmental grants, and (v) any of the foregoing in (ii)-(iv) whether
or not expressly listed in EXHIBIT A and whether or not abandoned, rejected, or
the like.
"UNLIMITED WARRANTIES" means, collectively, the representations and warranties
of Seller set forth in paragraphs 6.1, 6.2, 6.3, and 6.4 hereof.
3. TRANSMITTAL, REVIEW, CLOSING CONDITIONS AND PAYMENT
3.1 Transmittal. Within twenty (20) calendar days following the Effective Date,
Seller shall send to Purchaser the Assignment Agreements (certified copies
are acceptable if originals cannot be located), the List of Prosecution
Counsel, the Docket, and all files and original documents (including,
Letters Patents, assignments, and other documents necessary to establish
that the Seller's representations and warranties of Section 6 are true and
correct) relating to the Patents, including all prosecution files for
pending patent applications included in the Patents, and all files relating
to the issued Patents ("INITIAL DELIVERABLES"). Seller acknowledges that
Purchaser may request additional documents based on Purchaser's review of
the Initial Deliverables (such additional documents and the Initial
Deliverables, collectively, the "DELIVERABLES"), and that as a result of
Purchaser's review, the amount of payment and the assets listed in EXHIBITS
A, B1 AND B2 may be revised only by agreement of all parties signatory to
the entire patent purchase agreement.
3.2 Closing. The closing of the sale of the Assigned Patent Rights hereunder
will occur when all conditions set forth in paragraph 3.3 have been
satisfied or waived (the "CLOSING"). Purchaser and Seller shall use
reasonable efforts to carry out the Closing within thirty (30) calendar
days following receipt of the last received Deliverables.
3.3 Closing Conditions. The following are conditions precedent to Purchaser's
obligation to make the payment in paragraph 3.4.
(a) Transmittal of Documents. Seller shall have delivered to Purchaser all
the Deliverables.
(b) Compliance With Agreement. Seller shall have performed and complied in
all respects with all of the obligations under this Agreement that are
to be performed or complied with by it on or prior to the Closing.
(c) Representations and Warranties True. Purchaser shall be reasonably
satisfied that, as of the Closing, the representations and warranties
of Seller contained in Section 6 hereof are true and correct.
3.4 Payment. At Closing, Purchaser shall pay to Seller the amount of One
Hundred Seventy Five Thousand dollars ($175,000.00). Purchaser may record
the Executed Assignment with the United States Patent and Trademark Office
only upon Closing.
3.5 Termination and Survival. In the event all conditions to Closing set forth
in Section 3.3 are not met within ninety (90) days following the Effective
Date, Purchaser shall have the right to terminate this agreement by written
notice to Seller. Upon
termination, Purchaser will return all documents delivered to Purchaser
under this Section 3 to Seller. The provisions of paragraphs 8.4, 8.5, and
8.7 will survive any termination.
4. TRANSFER OF PATENTS AND ADDITIONAL RIGHTS
4.1 Assignment of Patents. Upon the Closing, Seller hereby sells, assigns,
transfers and conveys to Purchaser all right, title and interest in and to
the Patents and the Patent Rights (as defined in EXHIBITS B-1 AND B-2).
Seller understands and acknowledges that if any of the Patents are assigned
to Seller's affiliates or subsidiaries, prior to Closing, Seller may be
required to perform certain actions to establish that Seller is the
assignee and to record such assignments.
4.2 Assignment of Additional Rights. Upon the Closing, Seller hereby also
sells, assigns, transfers and conveys to Purchaser all right, title and
interest in and to
(a) inventions and discoveries described in any of the Patents;
(b) rights to apply in any or all countries of the world for patents,
certificates of invention, utility models, industrial design
protections, design patent protections, or other governmental grants
of any type related to any of the Patents and the inventions and
discoveries therein;
(c) causes of action (whether currently pending, filed, or otherwise) and
other enforcement rights, including, without limitation, all rights
under the Patents and/or under or on account of any of the Patents and
the foregoing category (b) to (i) damages, (ii) injunctive relief, and
(iii) any other remedies of any kind for past, current and future
infringement; and
(d) rights to collect royalties or other payments under or on account of
any of the Patents or any of the foregoing.
4.3 Grantback: Non-exclusive License. Purchaser hereby grants to Seller, a
royalty-free, irrevocable, non-exclusive, non-transferable (except as
provided in Section 4.4), non-assignable, non-sublicensable, worldwide
right and license under the Patents to internally practice the methods and
processes covered by the Patents, and to make, have made, use, distribute,
lease, sell, offer for sale, import, export, develop and otherwise transfer
or dispose of and otherwise exploit any products covered by the Patents
("COVERED PRODUCTS"). This license shall apply to the reproduction and
subsequent distribution of Covered Products by authorized agents of Seller,
such as a distributor, replicator, VAR or OEM.
4.4 Limited Transfer of Grantback. The license described in Section 4.3 may be
transferred one time to a purchaser of all, or substantially all, of
Seller's operating assets (other than cash), or to a party that by merger
or otherwise acquires all, or substantially all, of Seller's outstanding
capital stock. In the event of that transaction, this license shall
automatically become limited to the products, processes and services of the
Seller that are commercially released as of the date of the acquisition and
for
new versions that have merely incremental differences from such products,
processes and services. In no event, however, shall the thus transferred
license include any products, processes or services of the purchaser or
other party(ies) to the acquisition that were not previously included as of
the date of acquisition. The license described in Section 4.3 is
automatically revoked for any subsequent purchaser of all, or substantially
all, of the original purchaser's operating assets (other than cash), or to
a party that by merger or otherwise acquires all, or substantially all, of
original purchaser's or party's outstanding capital stock. Seller will
provide Purchaser written notice within thirty (30) days of the license
being transferred under this Section 4.4, and specifically detail the
products, processes and services of Seller and the purchaser/party that are
commercially released as of the date of the acquisition.
5. ADDITIONAL OBLIGATIONS
5.1 Further Cooperation. At the reasonable request of Purchaser, Seller shall
execute and deliver such other instruments and do and perform such other
acts and things as may be necessary or desirable for effecting completely
the consummation of the transactions contemplated hereby, including
execution, acknowledgment and recordation of other such papers, and using
commercially reasonable efforts to obtain the same from the respective
inventors, as necessary or desirable for fully perfecting and conveying
unto Purchaser the benefit of the transactions contemplated hereby. In
addition, Seller will continue to prosecute the Patents at its expense
until the Closing.
5.2 Payment of Fees. Seller shall pay any maintenance fees, annuities, and the
like due on the Patents until the Closing.
6. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby represents and warrants to Purchaser as follows that, as of the
Effective Date and as of the Closing:
6.1 Authority. Seller has the full power and authority, and has obtained all
third party consents, approvals and/or other authorizations required, to
enter into this Agreement and to carry out its obligations hereunder,
including, without limitation, the assignment of the Assigned Patent Rights
to Purchaser.
6.2 Title and Contest. Seller owns all right, title, and interest to the
Assigned Patent Rights, including all right, title, and interest to sue for
infringement of the Patents. Seller has obtained and properly recorded
previously executed assignments for the Assigned Patent Rights as necessary
to fully perfect its rights and title therein in accordance with governing
law and regulations in each respective jurisdiction. The Assigned Patent
Rights are free and clear of all liens, claims, mortgages, security
interests or other encumbrances, and restrictions. There are no actions,
suits, investigations, claims or proceedings threatened, pending or in
progress relating in any way to the Assigned Patent Rights. There are no
existing contracts, agreements, options, commitments, proposals, bids,
offers, or rights with, to, or in any person to acquire any of the Assigned
Patent Rights.
6.3 Existing Licenses. No licenses under the Patents, or interest or rights in
any of the Assigned Patent Rights, have been granted or retained.
6.4 Restrictions on Rights. Purchaser shall not be subject to any covenant not
to sue or similar restrictions on its enforcement or enjoyment of the
Assigned Patent Rights as a result of any prior transaction related to the
Assigned Patent Rights.
6.5 Conduct. Seller or its agents or representatives have not engaged in any
conduct, or omitted to perform any necessary act, the result of which would
invalidate any of the Patents or hinder their enforcement, including,
without limitation, misrepresenting Seller's patent rights to a
standard-setting organization.
6.6 Enforcement. Seller has not put a third party on notice of actual or
potential infringement of any of the Patents. Seller has not invited any
third party to enter into a license under any of the Patents. Seller has
not initiated any enforcement action with respect to any of the Patents.
6.7 Patent Office Proceedings. None of the Patents has been or is currently
involved in any reexamination, reissue, interference proceeding, or any
similar proceeding, and no such proceedings are pending or threatened.
6.8 Fees. All maintenance fees, annuities, and the like due on the Patents have
been timely paid.
6.9 Validity and Enforceability. The Patents have never been found invalid or
unenforceable for any reason in any administrative, arbitration, judicial
or other proceeding, and Seller does not know of and has not received any
notice or information of any kind from any source suggesting that the
Patents may be invalid or unenforceable.
7. REPRESENTATIONS AND WARRANTIES OF PURCHASER.
Purchaser hereby represents and warrants to Seller as follows that, as of the
Effective Date and as of the Closing:
7.1 Purchaser is a limited liability company duly formed, validly existing and
in good standing under the laws of the state of Nevada.
7.2 Purchaser has all requisite power and authority to (i) enter into, execute
and deliver this Agreement and (ii) perform fully its obligations
hereunder.
8. MISCELLANEOUS
8.1 Limitation of Liability. EXCEPT IN THE EVENT OF FRAUD OR BREACH OF ANY
UNLIMITED WARRANTY BY SELLER, SELLER'S TOTAL LIABILITY UNDER THIS AGREEMENT
SHALL NOT EXCEED THE PURCHASE PRICE SET FORTH IN PARAGRAPH 3.4 OF THIS
AGREEMENT. PURCHASER'S TOTAL LIABILITY UNDER THIS AGREEMENT SHALL NOT
EXCEED THE PURCHASE PRICE SET FORTH IN PARAGRAPH 3.4 OF THIS AGREEMENT. THE
PARTIES ACKNOWLEDGE THAT THESE LIMITATIONS ON
POTENTIAL LIABILITIES WERE AN ESSENTIAL ELEMENT IN SETTING CONSIDERATION
UNDER THIS AGREEMENT.
8.2 Limitation on Consequential Damages. NEITHER PARTY SHALL HAVE ANY
OBLIGATION OR LIABILITY (WHETHER IN CONTRACT, WARRANTY, TORT (INCLUDING
NEGLIGENCE) OR OTHERWISE, AND NOTWITHSTANDING ANY FAULT, NEGLIGENCE
(WHETHER ACTIVE, PASSIVE OR IMPUTED), REPRESENTATION, STRICT LIABILITY OR
PRODUCT LIABILITY), FOR COVER OR FOR ANY INCIDENTAL, INDIRECT OR
CONSEQUENTIAL DAMAGES OR LOSS OF REVENUE, PROFIT, SAVINGS OR BUSINESS
ARISING FROM OR OTHERWISE RELATED TO THIS AGREEMENT, EVEN IF A PARTY OR ITS
EMPLOYEES HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
8.3 Compliance With Laws. Notwithstanding anything contained in this Agreement
to the contrary, the obligations of the parties shall be subject to all
laws, present and future, of any government having jurisdiction over the
parties and this transaction, and to orders, regulations, directions or
requests of any such government.
8.4 Confidentiality of Terms. The parties hereto shall keep the terms and
existence of this Agreement and the identities of the parties hereto
confidential and shall not now or hereafter divulge any of this information
to any third party except (a) with the prior written consent of the other
party; (b) as otherwise may be required by law or legal process, including
in confidence to legal and financial advisors in their capacity of advising
a party in such matters; (c) during the course of litigation, so long as
the disclosure of such terms and conditions is restricted in the same
manner as is the confidential information of other litigating parties; (d)
in confidence to its legal counsel, accountants, banks and financing
sources and their advisors solely in connection with complying with
financial transactions; (e) by Purchaser, in order to perfect Purchaser's
interest in the Assigned Patent Rights with any governmental patent office
(including, without limitation, recording the Executed Assignment in any
governmental patent office); or (f) to enforce Purchaser's right, title and
interest in and to the Assigned Patent Rights; provided that, in (b)
through (f) above, (i) the disclosing party shall use all legitimate and
legal means available to minimize the disclosure to third parties,
including, without limitation, seeking a confidential treatment request or
protective order whenever appropriate or available; and (ii) the disclosing
party shall provide the other party with at least ten (10) days' prior
written notice of such disclosure. Without limiting the foregoing, Seller
agrees that it will cause its agents involved in this transaction to abide
by the terms of this paragraph 7.4, including ensuring that such agents do
not disclose or otherwise publicize the existence of this transaction with
actual or potential clients in marketing materials, or industry
conferences.
8.5 Governing Law; Venue/Jurisdiction. This Agreement shall be interpreted,
construed and enforced in all respects in accordance with the laws of the
State of New York, without reference to its choice of law principles to the
contrary. Seller shall not commence or prosecute any action, suit,
proceeding or claim arising under or by
reason of this Agreement other than in the state or federal courts located
in New York. Seller irrevocably consents to the jurisdiction and venue of
the courts identified in the preceding sentence in connection with any
action, suit, proceeding or claim arising under or by reason of this
Agreement.
8.6 Notices. All notices given hereunder shall be given in writing (in English
or with an English translation), shall refer to Purchaser and to this
Agreement and shall be: (i) personally delivered, (ii) delivered prepaid by
an internationally recognized express courier service, or (iii) sent
postage prepaid registered or certified U.S. mail (return receipt
requested) to the address set forth below:
If to Purchaser If to Seller
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Starvos Investments LLC On behalf of Semotus Solutions, Inc.
2215-B Renaissance Drive, Suite 5 and Expand Beyond Corporation
Las Vegas, NV 89119
Attn: Managing Director 718 University Ave, Suite 202,
Los Gatos, California
Attn: Tali Durant
Notices are deemed given on (a) the date of receipt if delivered personally
or by express courier (or if delivery refused, the date of refusal), or (b)
the fifth (5th) calendar day after the date of posting if sent by US mail.
Notice given in any other manner shall be deemed to have been given only if
and when received at the address of the person to be notified. Either party
may from time to time change its address for notices under this Agreement
by giving the other party written notice of such change in accordance with
this paragraph.
8.7 Relationship of Parties. The parties are independent contractors and not
partners, joint venturers, or agents of the other. Neither party assumes
any liability of or has any authority to bind, or control the activities
of, the other.
8.8 Joint and Several Liability. Seller 1 and Seller 2 each agree that each
will be jointly and severally liable under this Agreement.
8.9 Equitable Relief. Seller agrees that damages alone would be insufficient to
compensate Purchaser for a breach of this Agreement, acknowledges that
irreparable harm would result from a breach of this Agreement, and consents
to the entering of an order for injunctive relief to prevent a breach or
further breach, and the entering of an order for specific performance to
compel performance of any obligations under this Agreement.
8.10 Severability. If any provision of this Agreement is found to be invalid or
unenforceable, then the remainder of this Agreement shall have full force
and effect, and the invalid provision shall be modified, or partially
enforced, to the maximum extent permitted to effectuate its original
objective.
8.11 Waiver. Failure by either party to enforce any term of this Agreement shall
not be deemed a waiver of future enforcement of that or any other term in
this Agreement or any other agreement that may be in place between the
parties.
8.12 Miscellaneous. This Agreement, including its exhibits, constitutes the
entire agreement between the parties with respect to the subject matter
hereof, and merges and supersedes all prior and contemporaneous agreements,
understandings, negotiations and discussions. Neither of the parties shall
be bound by any conditions, definitions, warranties, understandings, or
representations with respect to the subject matter hereof other than as
expressly provided herein. The section headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning
or interpretation of this Agreement. No oral explanation or oral
information by either party hereto shall alter the meaning or
interpretation of this Agreement. No amendments or modifications shall be
effective unless in a writing signed by authorized representatives of both
parties. These terms and conditions shall prevail notwithstanding any
different, conflicting or additional terms and conditions that may appear
on any purchase order, acknowledgment or other writing not expressly
incorporated into this Agreement. The following exhibits are attached
hereto and incorporated herein: EXHIBIT A (entitled "Patents to be
Assigned"); EXHIBIT B-1 (entitled "Assignment of Patent Rights - Expand
Beyond Corporation"); and EXHIBIT B-2 (entitled "Assignment of Patent
Rights - Semotus Solutions, Inc.").
8.13 Counterparts; Electronic Signature. This Agreement may be executed in
counterparts, each of which shall be deemed an original, and all of which
together constitute one and the same instrument. Each party shall execute
and deliver to the other parties a copy of this Agreement bearing its
original signature. Prior to such execution and delivery, in order to
expedite the process of entering into this Agreement, the parties
acknowledge that Transmitted Copies of this Agreement shall be deemed
original documents. "TRANSMITTED COPIES" means copies that are reproduced
or transmitted via email of a .pdf file, photocopy, facsimile or other
process of complete and accurate reproduction and transmission.
THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK
In witness whereof, the parties have executed this Patent Purchase
Agreement as of the Effective Date.
SELLER: PURCHASER:
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EXPAND BEYOND CORPORATION STAVROS INVESTMENTS LLC
By: /s/ Tali Durant By: /s/ Bryan Durper 1/11/06
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Name: Tali Durant Name: Bryan Durper
Title: Corporate Secretary Title: Authorized Person
SELLER:
SEMOTUS SOLUTIONS, INC
By: /s/ Tali Durant
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Name: Tali Durant
Title: General Counsel
PATENTS TO BE ASSIGNED
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PATENT OR APPLICATION NO. COUNTRY FILING DATE TITLE AND INVENTOR(S)
- ------------------------- --------- ---------------- --------------------------------------
[Title of patent and Name(s) of
[Patent numbers] [Country] [Filing date(s)] inventors]
- ------------------------- --------- ---------------- --------------------------------------
6,772,169 US 09/27/2001 System, method and apparatus for the
wireless monitoring and management of
computer systems by inventor Kaplan;
Ari David (Chicago, IL)
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PCT/US01/46824 PCT 11/08/2001 System, method and apparatus for the
wireless monitoring and management of
computer systems by inventor Kaplan;
Ari David (Chicago, IL)
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60/247,523 US 11/09/2000 System and Apparatus for the Wireless
Monitoring and Management of
Databases KAPLAN; ARI DAVID (CHICAGO,
IL)
- ------------------------- --------- ---------------- --------------------------------------
6,711,678 US 04/05/2002 Pre-authenticated communication
within a secure computer network by
inventor Ferguson; Derek M. (Palos
Park, IL)
- ------------------------- --------- ---------------- --------------------------------------
PCT/US03/10659 PCT 04/04/2003 Pre-authenticated communication
within a secure computer network by
inventor Ferguson; Derek M. (Palos
Park, IL)
- ------------------------- --------- ---------------- --------------------------------------
10/040,524 US 11/01/2001 Method and system for secure wireless
database management by inventor
Kaplan, Ari D.; (Chicago, IL)
- ------------------------- --------- ---------------- --------------------------------------
PCT/US01/46752 PCT 11/08/2001 Method and system for secure wireless
database management by inventor
Kaplan, Ari D.; (Chicago, IL)
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10/007,912 US 11/08/2001 Method and system for wireless
database management by inventor
Kaplan, Arl D.; (Chicago, IL)
- ------------------------- --------- ---------------- --------------------------------------
PCT/US01/46751 PCT 11/08/2001 An Improved Method and System for
Wireless Database Management by
inventor Kaplan, Arl D.; (Chicago, IL)
- ------------------------- --------- ---------------- --------------------------------------
10/753,232 US 01/07/2004 Pre-authenticated communication
within a secure computer network by
inventor Ferguson, Derek M.; (Palos
Park, IL)
- ------------------------- --------- ---------------- --------------------------------------
5,875,436 US 08/27/1996 Virtual transcription system by
inventor Kikinis; Dan (Saratoga, CA)
- ------------------------- --------- ---------------- --------------------------------------
09/881,331 US 06/13/2001 System and service for receiving,
customizing, and re-broadcasting
high-speed financial data to users
operating wireless network-capable
devices by inventors BOARD, KAREN
ELEANOR; (VANCOUVER, CA) ; GOLSHAN,
FLORA; (SCARSDALE, NY) ; FOTA, CORNEL
R.; (NORTH VANCOUVER, CA)
- ------------------------- --------- ---------------- --------------------------------------
60/212,448 US 06/16/2000 Global Market Professional; BOARD,
KAREN ELEANOR; (VANCOUVER, CA)
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