MARKETING LICENSE AGREEMENT
THIS MARKETING LICENSE AGREEMENT (this
“Agreement”) is entered into by and between
GUARDIAN TECHNOLOGIES INTERNATIONAL, INC., a Delaware
corporation (hereinafter “GUARDIAN”), and EGC
INFOMATICS, Inc. (d.b.a. International Threat
Detection Systems [ITDS]), a Florida corporation, for itself and
its affiliate companies (hereinafter collectively referred to as
“EGC”), and shall be effective as of the 1st day of
November, 2007 (the “Effective Date”).
WITNESSETH:
WHEREAS , GUARDIAN is the owner of
certain computer programs defined herein as the
“Products”; and
WHEREAS , EGC is in the business of
distributing and supporting computer software applications to
its customers and prospects; and
WHEREAS , EGC has special knowledge
concerning the business needs of its customers and prospects;
and
WHEREAS , GUARDIAN wishes to appoint EGC
as its non-exclusive marketing representative for the Products
and authorize EGC to provide certain services relating to such
marketing efforts; and
WHEREAS , EGC is willing to accept such
appointment and to undertake to provide such services under the
terms of this Agreement;
NOW, THEREFORE , the parties agree as
follows:
1.
Scope
The Products covered by this Agreement are listed
on Exhibit “A” hereto and consist of computer programs
and associated end-user documentation offered generally to
end-users by GUARDIAN under the terms and conditions of its
standard license agreement. Additional software and/or hardware
applications may be added to the list of Products with the mutual
consent of the parties. The current form of license agreement is
attached hereto as Exhibit “B”. GUARDIAN also offers
enhancement and error-correction services with respect to the
Products under the terms and conditions of said agreement. GUARDIAN
reserves the right to change such agreement at any time.
2.
Appointment of EGC
Subject to the terms and conditions hereof,
GUARDIAN hereby designates and appoints EGC for the term of this
Agreement, as a non-exclusive representative for the solicitation
of license agreements relating to the Products from prospective
end-users identified by EGC. EGC hereby accepts such designation
and appointment. For purposes of this Agreement the term
“affiliate” shall mean any entity that directly or
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indirectly, through one or more intermediaries,
controls, is controlled by, or is under common control with such
other entity. In the case of a corporation, control shall mean,
among other things, the direct or indirect ownership of more
than fifty percent (50%) of its outstanding voting stock. The
foregoing notwithstanding, however, for the purpose of this
Agreement, GUARDIAN shall not be deemed to be an affiliate of
EGC, and EGC shall not be deemed an affiliate of GUARDIAN.
3.
Duties of EGC
3.1.
EGC agrees, for the term of this Agreement, that
it shall promote and market the Products to prospective
end-users by:
3.1.1.
Identifying prospects that may benefit from use
of the Products.
3.1.2.
Contacting such prospects and conducting
presentations of the Products.
3.1.3.
Performing demonstrations of the Products to
prospective end-users either on the premises of such end-users
or at EGC’s facilities.
3.1.4.
Negotiating and obtaining the prospects’
execution of license agreements and service agreements.
3.1.5.
Forwarding executed license agreements and
service agreements to GUARDIAN for GUARDIAN’s evaluation
and acceptance.
3.1.6.
Serving as a point of contact for necessary
communications between end-users and GUARDIAN with respect to
the Products.
3.2.
EGC shall prepare and submit to GUARDIAN monthly
a complete and accurate written report of its activities
hereunder, including, without limitation, the following:
3.2.1.
A description of all promotional and marketing
activities undertaken during the preceding month setting forth
the identity and addresses of prospective end-users.
3.2.2.
A summary of the nature of contacts made with
such end-users and EGC’s assessment of the results of such
contacts.
3.2.3.
A listing by identity and date of all license
agreements executed by prospective end-users and forwarded to
GUARDIAN as a result of EGC’s activities.
4.
Demonstration Rights
GUARDIAN hereby grants to EGC a non-exclusive,
non-transferable license to use during the term of this Agreement a
reasonable number of “Demonstration Copies” of each
Product for purposes of demonstrating the Product to prospective
end-users in connection with the marketing activities. EGC shall
use the Demonstration Copies for making demonstrations to
prospective end-users (i) on computer systems owned or leased by
EGC or (ii) on the computer system of a prospective end-user. In
each case,
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EGC shall (i) control and limit the use of
Products for the specific purpose authorized; (ii) accompany the
prospective end-user at all times that the Product is installed
at the site of such prospective end-user; and (iii) upon
completion of the demonstration, remove the Product from such
end-user’s computer and cause the deletion of all portions
of the Product from computer files in which it resided. EGC
acknowledges that the Products, including any intellectual
property rights pertaining thereto, are owned by GUARDIAN and
represent or contain valuable copyrights and trade secrets of
GUARDIAN. EGC shall not attempt to reverse-engineer or decompile
the machine-readable code in which the programs are delivered.
EGC shall protect the Products from unauthorized copying,
dissemination, or disclosure and from other unauthorized
use.
5.
License Agreements
5.1.
EGC shall have the authority to solicit the
signature of end-users on GUARDIAN’s standard form of
license agreement, as such agreement may be revised from time to
time by GUARDIAN and furnished to EGC, and such other license
agreements as EGC and GUARDIAN may mutually agree. Additionally,
upon request by an end-user, EGC may solicit the signature of
such end-user on EGC’s standard form of license agreement
as such agreement may be revised from time to time by EGC,
provided however, such license agreement if accepted by
GUARDIAN, shall be promptly assigned by EGC to GUARDIAN.
Notwithstanding anything to the contrary in this Agreement, EGC
shall not execute or accept on behalf of GUARDIAN any agreement
solicited from an end-user under this Section 5.1, and EGC shall
inform all end-users that any license agreement solicited under
this Section 5.1 must be forwarded to GUARDIAN for
consideration, acceptance, and execution by GUARDIAN in order
for such agreement to be binding on GUARDIAN.
5.2.
Notwithstanding anything to the contrary
contained in this Agreement, EGC has and shall exercise no
authority to (i) make any alterations in GUARDIAN’s
standard form of license agreement; (ii) make statements or
representations concerning the Products that exceed or are
inconsistent with the marketing materials and technical
specifications provided to EGC by GUARDIAN; or (iii) bind
GUARDIAN to any undertaking or performance with respect to the
Products.
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6.
Ancillary Services
6.1.
EGC may also provide to end-users appropriate
ancillary services in support of the Products. Such services
include, without limitation, the following:
6.1.1.
Assistance with installation of the Products on
end-users’ computers.
6.1.2.
Technical training of end-users’
personnel.
6.1.3.
Implementation and consulting support services
to end-users with respect to the functions and operation of the
Products.
6.2.
The terms, conditions, and charges for such
ancillary services shall be established by EGC directly with
end-users. EGC shall inform each end-user (i) that
GUARDIAN’s obligations are limited to those contained in
the license agreement, (ii) that any services of EGC are offered
on EGC’s own accounts, and (iii) that EGC is solely
responsible for such ancillary services.
6.3.
Upon the request by EGC, and subject to Section
6.2, GUARDIAN may provide to EGC (or to an end-user on behalf of
EGC) the ancillary services described in Section 6.1 in support of
the Products. All such ancillary services shall be provided to EGC
(or to an end-user on behalf of EGC) at rates agreed upon from time
to time by EGC and GUARDIAN, provided such rates shall in no event
exceed GUARDIAN’s published rate schedule, as in effect at
the time such services are rendered by GUARDIAN. The parties
acknowledge and agree that EGC, and not the end-user shall be
responsible for payment to GUARDIAN for services provided under
this Section 6.3, provided that GUARDIAN shall not be entitled to
payment from EGC unless and until (and only to the extent that) EGC
receives payment for such services from an end-user.
7.
Undertaking of GUARDIAN
GUARDIAN shall:
7.1.
Promote the Products as it deems appropriate
with international and local advertising.
7.2.
Provide to EGC’s employees technical
training with respect to the Products. GUARDIAN shall provide
such training at its own cost, but EGC shall be responsible for
travel and living expenses incurred by its employees.
7.3.
Provide reasonable quantities of marketing
materials, including descriptive brochures and promotional
materials suitable for unrestricted distribution.
7.4.
Evaluate the qualifications of prospective
end-users who have executed license agreements and service
agreements forwarded to GUARDIAN by EGC. GUARDIAN reserves the
right, in its discretion, to reject license agreements and
service agreements executed by prospective end-users.
7.5.
Perform all obligations of GUARDIAN under
accepted license agreements, including shipment or delivery to
end-users of copies of the computer programs,
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documentation, error-correction materials, and
updates that constitute the Products.
7.6.
Invoice and collect amounts payable under each
license agreement accepted by GUARDIAN.
8.
Compensation
8.1.
EGC shall receive a commission equal to eighteen
percent (18%) of the net license fee revenue actually collected
by GUARDIAN under license agreements for Products which are
secured and forwarded to GUARDIAN by EGC and accepted by
GUARDIAN.
The term “net license fee
revenue” means the actual license fee revenue received
by GUARDIAN less royalties, commissions, hardware fees or
similar payments due third parties in connection with the
licensing of Products. Payment of compensation to EGC shall be
made by GUARDIAN within ten (10) days after receipt of payment
from end-user. Cash payment shall be accompanied by a detailed
accounting of the basis for such payment, identifying the source
and amount of applicable revenues received by GUARDIAN.
“Net license fee revenue” shall not include
maintenance or service fees paid to GUARDIAN by end-users.
8.2.
Amounts payable to EGC shall be subject to a
charge-back or credit in favor of GUARDIAN in the amount
previously paid EGC with respect to amounts that are refunded to
end-users. EGC agrees to cooperate with GUARDIAN and aid in the
collection of accounts receivable under license agreements
forwarded to GUARDIAN by EGC.
8.3.
EGC shall be responsible for its own expenses
and costs under this Agreement, and GUARDIAN shall have no
obligation to reimburse EGC for any expenses or costs incurred
by EGC in the performance of its duties hereunder.
9.
Term and Termination
9.1.
The term of this Agreement shall commence upon
the Effective Date and shall continue for two (2) years
thereafter unless sooner terminated in accordance with the
provisions hereof. This Agreement shall be automatically renewed
for additional two year periods every two years unless there is
an uncured default by EGC.
9.2.
GUARDIAN may terminate this Agreement upon
written notice to EGC in the event of the breach of any material
obligation hereunder by EGC that is not cured by EGC after
receipt from GUARDIAN of thirty (30) days’ written notice
calling attention to such breach and demanding cure thereof. In
the event of such termination for cause, GUARDIAN’s sole
obligation to EGC shall be to pay compensation accrued for net
revenues collected on covered license agreements accepted by
GUARDIAN prior to the date of termination.
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9.3.
Upon termination of this Agreement for any
reason, EGC shall within thirty (30) days of such termination
return to GUARDIAN all Demonstration Copies of the Products, and
all copies of related marketing materials. EGC shall further
provide to GUARDIAN copies of EGC’s prospect files.
10.
Indemnities
10.1.
GUARDIAN hereby agrees to indemnify EGC from and
against any and all claims, demands, or actions arising out of
any material breach by GUARDIAN of any of the terms and
conditions of any license agreement with an end-user secured by
EGC hereunder or any breach of GUARDIAN’s obligations
hereunder.
10.2.
EGC hereby agrees to indemnify GUARDIAN from and
against any and all claims, demands, or actions arising out of
EGC’s activities or performance outside the express
authorization provided EGC under this Agreement or any breach of
EGC’s obligations hereunder.
10.3.
The indemnities contained in this Section 10
shall be conditioned upon the indemnifying party’s
receiving (i) prompt written notice of any claims, demands, or
actions for which indemnity is sought; (ii) cooperation in the
defense by the party seeking indemnity; and (iii) control of the
defense and/or settlement of such claim, demand, or action as to
which indemnity is sought.
11.
Limitations of Liability
In no event shall either party hereto be entitled
to special, indirect, or consequential damages, including lost
profits, for breach of this Agreement. Remedies shall be limited to
claims for amounts due hereunder or for indemnification as provided
for herein. However, the foregoing limitation of remedies shall not
apply to any action by GUARDIAN for infringement by EGC; any action
based on or with respect to unauthorized publication, disclosure,
or use of confidential information or trade secrets of GUARDIAN; or
any action based on GUARDIAN’s rights in copyrights,
trademarks, or trade secrets or other proprietary rights in the
Products.
12.
Trademarks
Except for purposes of identification of Products,
no right, title, interest, or license in or to any trademark or
service mark of GUARDIAN is granted to EGC under this Agreement.
EGC may on its business cards, stationery and marketing materials
state that EGC is an authorized agent of GUARDIAN for the licensing
of the Products.
13.
Status of EGC’s
Personnel
The parties to this Agreement are and shall remain
independent contractors, and nothing herein shall be construed to
create a partnership, or joint venture, between GUARDIAN and EGC.
EGC shall be responsible for the wages, hours, and conditions of
employment of EGC’s personnel during the term of and under
this Agreement. Nothing herein shall be construed as implying that
employees of EGC are employees of GUARDIAN.
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14.
Notices
All notices, demands, or consents required or
permitted under this Agreement shall be in writing and shall be
delivered personally or sent by certified or registered mail to the
appropriate party at the address set forth below, or at such other
address as shall be given by either party to the other in
writing:
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Guardian Technologies International, Inc.
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EGC INFORMATICS
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516 Herndon Parkway, Suite A
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1925 Brickell Ave. Suite D-1510
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Herndon, Virginia 20170
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Miami, Florida 33129
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Attn: Bill Donovan
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Attn: Angel Lorie
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President
& Chief Operating Officer
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President
& Chief Operating Officer
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(703) 464-5495
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(786) 306-8740
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15.
Choice of Law
This Agreement shall be deemed to be made in the
Commonwealth of Virginia and in all respects shall be interpreted,
construed, and governed by and in accordance with the laws of the
Commonwealth of Virginia.
16.
Waiver of Rights
The waiver by either party of any term or provision
of this Agreement shall not be deemed to constitute a continuing
waiver thereof nor of any further or additional rights such party
may hold under this Agreement.
17.
No Assignment;
Enforceability
This Agreement is personal to EGC and is not
assignable without the prior written consent of GUARDIAN. Any
attempt to assign, transfer, or subcontract any of the rights,
duties, or obligations of this Agreement without such consent is
void.
18.
Dispute Resolution
18.1.
In the event that any dispute arises between
GUARDIAN and EGC in connection with this Agreement, the
representatives of each party responsible for the subject matter
of such dispute shall use good faith efforts to resolve such
dispute promptly. In the event that such dispute cannot be
resolved by the parties’ representatives, the matter shall
be submitted to the parties’ respective Chief Executive
Officers (“CEOs”) for resolution. In the event that
the CEOs cannot reach resolution of the issue (an
“Unresolved Dispute”), then the matter shall be
settled by binding arbitration in accordance with the provisions
of Section 18.2 hereof.
18.2.
Any Unresolved Dispute, after the completion of
the steps set forth above, shall be settled at the election of
either party, by final and binding independent arbitration. All
arbitrations pursuant to this Agreement shall be conducted
before the American Arbitration Association (“AAA”)
in Reston, Virginia, U.S.A., and shall be carried out in
accordance with the Commercial Arbitration Rules of the AAA then
in effect (the “Rules”) and the provisions of this
Agreement.
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GUARDIAN and EGC shall each select one
arbitrator and a third arbitrator will be selected unanimously
by the arbitrators selected by GUARDIAN and EGC. If the two
arbitrators selected by GUARDIAN and EGC are unable to select
the third arbitrator within ten (10) days of the appointment of
the two arbitrators, the parties consent to the selection of the
third arbitrator by the AAA administrator. The award of the
arbitrators may be enforced by any court having jurisdiction
over the parties.
19.
Export Restrictions
GUARDIAN and EGC each hereby agrees to comply with
all export laws and restrictions and regulations of the Department
of Commerce or other United States agency or authority, and not to
knowingly export, or allow the export or re-export of any Product,
or any derivatives thereof, in violation of any such restrictions,
laws or regulations, or, without all required licenses and
authorizations to any country specified in the then current
Supplement No. 1 to Section 770 of the U.S. Export Administration
Regulations (or any successor supplement or regulations).
20.
General
20.1.
In the event that any provision of this
Agreement shall be rendered invalid or otherwise unenforceable
by any competent judicial or government authority, such
invalidity or unenforceability shall not affect the validity or
enforceability of any other provision of this Agreement and the
invalid provision shall be deemed amended to the fullest extent
allowable by applicable law to effect the purposes of said
provision.
20.2.
GUARDIAN and EGC shall each be excused for any
failure or delay in performing any of their respective
obligations under this Agreement, if such delay or failure is
caused by any act of God, any accident, explosion, fire, storm,
riot, embargo, war, any failure or delay of transportation,
shortage of or inability to obtain supplies, equipment, fuel or
labor or any other circumstance or event beyond the reasonable
control of the party relying upon such circumstance or
event.
20.3.
The parties agree that this Agreement is the
complete and exclusive statement thereof between the parties and
that it supersedes and merges all prior proposals and
understandings and all other agreements, whether oral or
written, between the parties relating to the subject matter
hereof. This Agreement may not be modified or altered except by
a written instrument duly executed by the parties hereto.
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IN WITNESS WHEREOF , the parties have
caused this Agreement to be executed as set forth below.
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Guardian Technologies International, Inc.
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EGC Informatics, Inc.
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/s/ William J. Donovan
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/s/ Angel Lorie, Jr.
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William J. Donovan
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Angel Lorie, Jr.
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President & Chief Operating Officer
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President & Chief Operating Officer
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Date: 11/2/07
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Date: 11/1/07
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Guardian Technologies International, Inc.
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Confidential and Proprietary
EXHIBIT A
Guardian Technologies automatic threat
identification and alert system, PinPoint™ is incorporated
into an intelligent image informatics engine ( 3i )
resident on a standard Pentium 4 based microprocessor. The
PinPoint™ 3i system can be configured with
various options and ordered under the commercial terms of a
Perpetual License, Rental or Transactional based terms.
1.
Perpetual License:
A “Perpetual License” is granted to
an end user organization pursuant to an end user license
agreement. The end user shall pay Guardian the following
amount(s) with respect to Products delivered under a Perpetual
License.
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Product Description
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License Fee per Scanning Device
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1-99 Licenses
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100-499 Licenses
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500+ Licenses
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PinPoint 3i Engine
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PinPoint Module Metal
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PinPoint Module Explosives
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Annual fees for Support
Services
Shall be in addition to the foregoing Perpetual
License fees. Each end user of a Perpetual License shall
pay an annual fee for Support Services of 20% of the
then-applicable price for the number of Perpetual Licenses held
by such license holder beginning in year two and for every year
after the Perpetual License is in use.
2.
Rental License:
A “Rental License” is a license
granted to an end user organization pursuant to an end user
license agreement under which the end user pays a monthly
license fee and the license expires at the end of a three-year
license term. The end user organization shall pay Guardian
the following amount(s) with respect to Products delivered to an
end user under a Rental License:
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Product Description
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Monthly Rental per Scanning Device For Three
Years
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1-99 Licenses
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100-499 Licenses
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500+ Licenses
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PinPoint 3i Engine
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PinPoint Module Metal
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PinPoint Module Explosives
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Guardian and the end user organization may agree
to extend the term of the Rental License for successive
additional periods of one (1) year each after the expiration of
the initial three (3) year period.
Guardian has the right, upon notice, to increase
the prices set forth above for Rental Licenses no more than once
in any calendar year by a percentage equal to the percentage
change during the preceding twelve (12) month period in the
Consumer Price Index for All Urban Consumers (CPI-U) for the
U.S. City Average for All Items compiled by the U.S. Bureau of
Labor Statistics (or a successor country index thereto).
The Prices set forth above include Annual
Support Services during the term of the Rental License.
3.
Transactional License:
A “Transactional License” is a
license granted to an end user organization pursuant to an end
user license agreement under which the end user pays a per
passenger fee and the license expires at the end of a three-year
license term. The end user organization shall pay Guardian
the monthly total fees based upon the following per passenger
fee with respect to Products delivered to an end user under the
Transactional License:
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Product Description
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Transaction Fee Per Passenger for a Term of
Three Years
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PinPoint 3i Engine
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PinPoint Module Metal
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PinPoint Module Explosive
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The Prices set forth above include Annual
Support Services during the term of the Rental License.
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The end user organization may also elect to
increase the fee to cover administrative expenses.
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Confidential and Proprietary
EXHIBIT B
PROPRIETARY SOFTWARE LICENSE AND HAR
