ASSET PURCHASE AND SALE AGREEMENT
This Asset
Purchase and Sale Agreement (the “Agreement”) is made
and executed as of the 17th day of July, 2009, by and between
NeoMedia Technologies, Inc., a company organized under the laws
of the State of Delaware, United States of America, with
its principal offices located at Two Concourse Parkway, Suite 500,
Atlanta, GA 30328, USA (the “Seller”) and Silver Bay
Software LLC, a Limited Liability Company organized under the laws
of the State of Delaware, with its principal place of business
located at 100 Adams Street, Dunstable, MA, 01827, USA (the
“Purchaser”) (collectively referred to herein as
“Parties” or individually as “Party”). This
Agreement shall be effective July 17, 2009 (the “Effective
Date”).
WITNESSETH
WHEREAS, Seller
owns or controls, or both, all rights to the Products identified in
Schedule 1, and related technology and know-how and associated
software, documentation, hardware, peripheral equipment, customer
lists, customer agreements, service history, and other related
items, listed on Schedule 2 (the items listed on Schedules 1 and 2
are collectively to herein as the “Assets”), all of
which together allow customers of Seller who are listed in Schedule
3 to print specific, individualized bar codes; and
WHEREAS,
Purchaser wishes to purchase the Assets and Seller is willing to
sell the Assets in exchange for consideration as described
below.
NOW, THEREFORE,
in consideration of the premises and the mutual covenants and
agreements contained herein, and for other good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged by each of the Parties hereto, the Parties agree as
follows:
ARTICLE I.
DEFINITIONS
1.1 “Confidential
Information” shall mean all information disclosed to a Party
(“Receiving Party”) by the other Party
(“Disclosing Party”) in connection with this Agreement
that is conveyed (a) in written, graphic, or other tangible form
and conspicuously marked “confidential”,
“proprietary” or in some other manner to indicate its
confidential or proprietary nature; or (b) orally, provided that
such information is designated in writing as confidential or
proprietary within thirty (30) days of such oral disclosure.
Additionally, subject to Article VI below, the following
information shall be deemed Confidential Information even if not
conspicuously marked “confidential” or
“proprietary”: all know-how in whatever form,
documentation, formulations, algorithms, compilations, manuals,
manufacturing processes, business methods, computer programs,
symbols, or other know-how and supporting material related to the
research, development, manufacture, marketing, sale, copyrights,
trademarks, patents, technology, trade secrets and internal
management systems relating to the Assets, whether conveyed
verbally, in writing, on diskette, on tape or other
media.
1.2 “Product”
or “Products” shall mean, individually and
collectively, those software products listed in Schedule
1.
1.3 “Documentation”
shall mean all elements of Know-how, software, customer agreements,
service history and other Licensed Technology that are in writing
or other tangible form.
1.4 “Know-how”
shall mean all trade secrets and Confidential Information,
including process or production information, formulas, information
on compositions of matter, techniques or methods related to the
manufacture, package, assembly, marketing, sale or distribution of
the Licensed Products, Know-how or Licensed Technology.
1.5 “Transferred
Technology” shall mean, individually and collectively, the
Know-how, and Confidential Information which are sold pursuant to
the terms of this Agreement, and are necessary for the marketing,
sale or distribution of the Services and licensing of the Products,
and which are being sold by the Seller to the Purchaser pursuant to
this Agreement.
1.6 “Covered
Products” shall mean the Products themselves, as well as any
product that is manufactured, used, marketed, distributed or sold
by Purchaser or any of its Subsidiaries or affiliates using any of
the Transferred Technology or Know-how.
1.7 “Licensed
Copyrights” shall mean the Seller copyrighted material
associated with any and all Products.
1.8 “Subsidiaries”
shall mean those corporate entities in which a Party directly or
indirectly owns 50% or more of the voting securities of such
corporate entities, or is otherwise related to a Party through 50%
or more of common ownership of the stock by the same
parent.
1.9 “Customers”
shall mean the listed persons and business and governmental
entities set forth in Schedule 3 attached hereto as well as any
successors, assigns or transferees of such persons and entities.
“Customer” shall mean an individual person, business or
governmental entity, and its successors, assigns or transferees,
listed on Schedule 3.
1.10 “Services”
shall include sales consultation, licensing, delivery, billing,
installation support, technical support and any and other services
required by customers to use the Products in the manner in which
they are intended.
1.11 “Revenue”
shall mean payments from Customers received by either Party on or
after the Effective Date that result from the sale, lease,
licensing, or maintenance of the Covered
Products. Explicitly excluded from the definition of
Revenue shall be payments received by Purchaser related to products
other than the Covered Products, or payments received for Covered
Products from persons or entities who are not one of the Customers
listed in Schedule 3, including their successors, assigns or
transferees.
ARTICLE II.
SALE OF ASSETS
2.1 As
of the Effective Date, Purchaser shall purchase and accept, and
Seller shall sell, assign, transfer, convey and deliver to
Purchaser, all of Seller’s rights, titles and interests in
and to the Assets. As of the Effective Date of this Agreement,
except as may otherwise be set forth herein, Purchaser shall have
all rights to, responsibilities for, obligations of , and
liabilities related to the Assets and Seller shall be relieved of
all such rights, responsibilities, obligations, and
liabilities.
2.2 Seller
shall assist Purchaser in transitioning Customer relationships from
Seller to Purchaser. The Parties shall jointly draft and send to
each Customer a letter advising the Customer of the fact that
Purchaser will now be responsible for all future relations with
Customers related to the services provided by means of the Assets
(the “Services”) and how to contact Purchaser. In the
event that, after the Effective Date, a Customer or other person or
entity contacts Seller about any issue related to the Products,
Services, or to the Assets themselves or the sale thereof to
Purchaser, Seller shall refer such Customer to Purchaser. In the
event any person or entity makes an inquiry of Seller about
purchasing the Services or purchasing or licensing the Products,
Seller shall refer such person or entity to Purchaser.
2.3 Upon
the Effective Date, Purchaser shall be responsible for billing of,
and have the rights to all Revenue from, all Customers and any and
all other persons or entities who purchase Services or purchase or
license Products after the Effective Date. To assist Purchaser in
such billing, Seller shall make available to Purchaser, upon
Purchaser’s request, copies of its billing record for the
Customers. In the event Seller receives, on or after the Effective
Date, a payment related to the Services or Products, Seller shall,
within thirty (30) days, forward such payment in full to Purchaser,
and such payment shall be considered Revenue as defined above.
Seller shall have the sole right to any payments received by Seller
prior to the Effective Date and shall have no obligation to forward
such payments to Purchaser.
2.4 As
of the Effective Date, Purchaser shall be responsible for providing
the Services to the Customers, including but not limited to
responding to and rectifying any Customer service claims or
complaints, whether the matter that gave rise to such claim or
complaint occurred prior to or after the Effective Date.
2.5 Purchaser
shall not represent to any entity or person, in any manner, that it
represents, acts on behalf of, is an agent for, or is otherwise
authorized to bind or act on behalf of Seller.
2.6 As
of the Effective Date, Purchaser shall have the exclusive right to
prosecute, maintain, defend and enforce the Assets referred to in
this Agreement, entirely at its own cost and discretion and Seller
shall have no right or obligation to take any action for the
prosecution, maintenance, defense or enforcement of the Assets in
any way.
2.7 Except
for the Assets sold under this Agreement, Purchaser is not granted
any license or other rights relating to the products or patents or
other intellectual property rights of the Seller whether by
implication or otherwise.
ARTICLE III.
REVENUES AND ROYALTY
3.1 Purchaser
shall be entitled to all Revenues received on or after the
Effective Date. In consideration for its acquisition of the Assets,
Purchaser shall pay to Seller a royalty of twenty percent (20%) of
the Revenues received during the three (3) year period commencing
on the Effective Date (the “Royalty”), subject to the
Credit defined below.
3.2 The
Parties acknowledge and agree that certain changes and upgrades may
have to be made to the Assets in order for the Services to continue
to perform in a satisfactory manner. Purchaser shall be solely
responsible, at its sole expense, for making any such changes and
upgrades that the Purchaser, in its sole discretion, deems
necessary and Purchaser shall make such changes in a manner and in
a time frame that does not adversely affect the Customers. However,
Purchaser assumes all liabilities to make such changes consistent
with its assumption of all liabilities and obligations to the
Customers under the license agreements assumed by Purchaser in this
Agreement and in the license agreements with the
Customers. In consideration for making such changes and
upgrades, Purchaser shall receive a credit against the Royalty of
no more than Fifty Thousand Dollars ($50,000) (the
“Credit”). This Credit shall be applied against the
Royalty as a credit to the amount Purchaser otherwise owes Seller
as a Royalty for that quarter until the accumulated credits against
the royalty shall equal but not exceed $50,000. Thereafter the
Royalty shall be paid to the Purchaser in full.
3.3 Payment
of Royalties shall be made on a quarterly basis. Each payment shall
be made within thirty (30) days after the end of each quarter and
shall include a summary statement of the Revenues, the Royalty
calculation and the Credit applied, if any. In the event of
termination of this Agreement, a final Royalty payment shall be
made within thirty (30) days following such termination.
3.3 All
payments owed to Seller pursuant to this Article III Revenues and
Royalty shall be made in U.S. Dollars in accordance with payment
instructions given by Seller.
ARTICLE IV.
WARRANTIES
No warranties,
express, implied or statutory are made with respect to the Assets
or any part thereof except as expressly set forth in this
Section.
4.1. The
Seller represents and warrants that: (i) the Seller is duly
authorized and has the requisite power and authority to enter into
this Agreement and to perform Seller’s obligations hereunder;
(ii) the Seller has full right and title to the Assets without
encumbrance or lien and the right to sell the Assets; (iii) the
execution, delivery and performance by the Seller of this Agreement
will not violate any provision of any applicable law or regulation
presently in effect or any provision of its constituent documents
or result in a breach of any agreement, obligation or restriction
by which the Seller is bound; (iv) this Agreement is a legal, valid
and binding obligation of Seller, enforceable against the Seller in
accordance with the Agreement’s terms and conditions; (v) the
Seller is not under any obligation to any person, contractual or
otherwise, conflicting or inconsistent in any respect with the
terms of this Agreement or which would impede the diligent and
complete fulfillment of the Seller’s obligations hereunder;
and (vi) the Assets sold by the Seller hereunder are provided on an
“AS IS” basis and subject to the further limitations
set forth in Section 4.3 below.
4.2 Purchaser
represents and warrants that: (i) Purchaser is authorized by its
board of directors or shareholders’ meeting to have the
requisite power and authority to enter into this Agreement and to
perform Purchaser’s obligations hereunder; (ii) Purchaser has
conducted sufficient due diligence investigation with respect to
the Assets in all respects, including but not limited to, the
technical effectiveness thereof; (iii) the execution, delivery and
performance by the Purchaser of this Agreement will not violate any
provision of any applicable law or regulation presently in effect
or any provision of the Purchaser’s constituent documents or
result in a breach of any agreement, obligation or restriction by
which the Purchaser is bound; (iv) this Agreement is a legal, valid
and binding obligation of Purchaser, enforceable against the
Purchaser in accordance with the Agreement’s terms and
conditions; (v) the Purchaser is not under any obligation to any
person, contractual or otherwise, conflicting or inconsistent in
any respect with the terms of this Agreement or which would impede
the diligent and complete fulfillment of the Purchaser’s
obligations hereunder; and (vi) the Assets purchased by it
hereunder are purchased on an “AS IS” basis and subject
to the further limitations set forth in Section 4.3
below.
4.3 The
provisions of Article IV allocate the risks under this Agreement
between the Seller and the Purchaser, and the respective benefits
and obligations described herein reflect such allocation of risk
and the limitation of liability agreed to under this Agreement.
Nothing in this Article IV shall be construed as: (i) a warranty or
representation by Seller as to the validity or scope of any
component of the Assets; or (ii) a warranty or representation that
anything made, used, sold or otherwise disposed of under this
Agreement does not or will not infringe the intellectual property
rights of third parties; or (iii) a requirement that either Party
shall file any patent application, secure any patent or maintain
any patent in force; or (iv) conferring a right to use in
advertising, publicity or otherwise any trademark or tradename of
the other Party; or (v) granting by implication, estoppel or
otherwise any License or rights under any patent, technology,
trademark or copyright other than the Assets, Know-how and Licensed
Copyrights.
THE WARRANTIES
EXPRESSLY SET FORTH IN THIS SECTION ABOVE ARE EXCLUSIVE AND IN LIEU
OF ALL OTHER WARRANTIES, AND THERE ARE NO OTHER REPRESENTATIONS OR
WARRANTIES OF ANY KIND, WHETHER WRITTEN, ORAL, EXPRESS, IMPLIED OR
STATUTORY, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. SELLER SHALL
NOT HAVE ANY LIABILI
