EXHIBIT 10.21
DEVELOPMENT AGREEMENT
between
LUCENT TECHNOLOGIES INC.
and
mPHASE TECHNOLOGIES, INC.
Effective as of March 1, 2005
Relating to MEMS-Based Magnetometer
Arrays
DEVELOPMENT AGREEMENT
TABLE OF CONTENTS
ARTICLE I- DEVELOPMENT
PROJECT
1.01 Scope of Development
Project
1.02 Cost of Development Project
ARTICLE II- INTELLECTUAL
PROPERTY
2.01 Existing Intellectual
Property
2.02 Rights in Developed Information
2.03 Rights in Inventions
2.04 Patent Licenses
2.05 Licenses to Technology
2.06 Co-Branding
2.07 No Other Licenses
ARTICLE III - TERM AND
TERMINATION
3.01 Termination
3.02 Survival
ARTICLE IV- PROTECTION OF
INFORMATION
4.01 Lucent and Company
Confidential Information
4.02 Joint Information
4.03 Exceptions to Confidentiality
4.04 Export Control
4.05 Restricted Information
ARTICLE V - MISCELLANEOUS
PROVISIONS
5.01 Compliance with Rules and
Regulations and Indemnification
5.02 Agreement Prevails
5.03 Accuracy
5.04 Nothing Construed
5.05 Disclaimer
5.06 Addresses
5.07 Integration
5.08 Nonassignability
5.09 Choice of Law
5.10 Agreement Confidentiality
mPhase Technologies, Inc.
DEVELOPMENT AGREEMENT
5.11 Dispute Resolution
5.12 Relationship Between Parties
5.13 Force Majeure
5.14 Headings
5.15 Waiver
5.16 Severability
5.17 Execution In Counterparts
5.18 Payments and Taxes
5.19 Non-Solicitation
APPENDIX A - DEFINITION
APPENDIX B1 - STATEMENT OF WORK
APPENDIX B2 - Cost of Development Project
APPENDIX B3 - Royalties
APPENDIX C1 - Lucent Patents and/or Patent Applications
APPENDIX C2 - mPhase Patents and/or Patent Applications
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mPhase Technologies, Inc.
DEVELOPMENT AGREEMENT
DEVELOPMENT AGREEMENT
THIS DEVELOPMENT
AGREEMENT ("Agreement"),
effective as of March 1, 2005 ("Effective Date"), is made by and
between Lucent Technologies Inc., a Delaware corporation, with
offices located at 600 Mountain Avenue, Murray Hill, New Jersey
07974-0636 ("Lucent") and mPhase Technologies Inc., a New Jersey
corporation, with offices located at 587 Connecticut Avenue,
Norwalk, CT 06854 ("Company"). Lucent and Company are sometimes
referred to herein individually as a "Party" and collectively as
the "Parties". The Parties agree as follows:
*
ARTICLE I
DEVELOPMENT PROJECT
1.01 Scope of Development
Project
The Parties shall, during the
Development Period, use reasonable efforts to work cooperatively
with each other in order to perform the Development Project
described in the Statement of Work in Appendix B1 pursuant to the
schedule contained therein. This initial Statement of Work in
Appendix B1 relates to development of a detailed and comprehensive
plan that would help shape the technical direction of one or more
subsequent SOWs to develop the Licensed Product. Subsequent SOWs
may cover one or more of the following:
Research and development,
consisting of design, modeling, and testing of a MEMS-based
magnetometer concept.
Research and Development of the
associated electronics, choice of magnetic and semiconductor
materials.
Research and Development of the
fabrication methods including packaging of a MEMS-based
magnetometer.
Formulation of an initial
manufacturing plan for a MEMS-based magnetometer.
_______________________
* Any term in capital letters which is defined in Appendix A -
Definitions shall have the meaning specified therein.
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mPhase Technologies, Inc.
DEVELOPMENT AGREEMENT
During the course of the
Development Project, it is anticipated that Developed Information
will be produced by the Parties. Developed Information may include
Technical Information, Hardware and/or Software. Representatives
for Lucent and Company shall meet as needed, either in person or by
telephone, to evaluate and discuss the progress of the Development
Project. The parties may, from time to time, agree upon additional
statements of work that will likewise be appended to and become a
part of this Agreement.
Such Statements of Work may be
executed on behalf of Company only by the EVP Research and
Development or a delegated representative appointed by the CEO of
mPhase, and on behalf of Lucent only by the President of the New
Jersey Nanotechnology Consortium. Each Statement of Work will be
governed by and construed in accordance with the terms and
conditions of this Agreement, but to the extent there is any
inconsistency between the terms and conditions of a Statement of
Work and those of this Agreement, the terms and conditions of the
Statement of Work shall take precedence and control the rights and
obligations of the Parties. Notwithstanding the foregoing, to the
extent that any intellectual property terms and conditions of this
Agreement are to be modified or superseded by the terms and
conditions of a Statement of Work, such intellectual property terms
shall be specifically identified in the Statement of Work and must
be executed on behalf of Lucent only by the President -
Intellectual Property Business and on behalf of Company by , the
EVP Research and Development or a delegated representative
appointed by the CEO of mPhase. For convenience, the Parties agree
that Statements of Work will contain information relating to the
duration, scope and deliverables for each Development Project, the
number of personnel and the responsibilities of each
Party.
1.02 Cost of Development
Project
The cost of the Development
Project to be paid by Company to Lucent are set forth in Appendix
B2.
ARTICLE II
INTELLECTUAL PROPERTY
2.01 Existing Intellectual
Property
Except as provided in Sections
2.04 and 2.05 below, all right, title and interest in and to
inventions, patents, works of authorship, trade secrets, know-how
or any other intellectual property existing prior to the Effective
Date of this Agreement shall remain vested in the Party which owns
it immediately prior to the Effective Date.
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DEVELOPMENT AGREEMENT
2.02 Rights in Developed
Information
(a) Except as specifically
provided otherwise in this Agreement, all works of authorship,
trade secrets, know-how or any other intellectual property first
created and reduced to tangible, recordable or permanent form,
solely by employees, contractors, consultants or agents of one
Party during the Development Period and as a direct result of work
performed under this Agreement, shall be termed "Developed
Information" and shall be owned solely by that Party.
(b) Except as specifically
provided otherwise in this Agreement, all Developed Information
created jointly by one or more employees, contractors, consultants
or agents of one Party working in conjunction with one or more
employees, contractors, consultants or agents of the other Party
during the Development Period, and as a direct result of work
performed under this Agreement, shall be owned jointly by both
Parties. Subject to the provisions of Sections 4.01 and 4.02, each
Party shall have the right to grant nonexclusive licenses under
jointly owned Developed Information, and each Party hereby consents
to the granting of such licenses by the other Party. Royalties that
each Party receives for granting licenses under jointly owned
Developed Information shall be subject to the provisions of
Appendix B3.
(c) Notwithstanding Sections
2.02(a) and 2.02 (b), Developed Information shall not include (a)
the portion of Lucent Information that is defined in Section 2.01
above or (b) the portion of Company Information that is defined in
Section 2.01 above.
(d) Nothing contained in this
Agreement shall preclude either party from including Developed
Information in a patent application for a sole invention as
described in Section 2.03(a) or for a joint invention as described
in Section 2.03(b).
2.03 Rights in
Inventions
(a) Sole
Inventions
(i) All right, title and interest
in and to inventions created solely by a Party during the
Development Period and arising out of the Development Project,
which inventions are not made jointly with employees, contractors,
consultants or agents of the other Party, shall remain vested in
the Party which created it.
(ii) Either Party may file patent
applications for its sole inventions, but neither Party shall be
required to file such patent applications, secure any patent or
maintain any patent.
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DEVELOPMENT AGREEMENT
(b) Joint
Inventions
(i) For purposes of this
Agreement, a Joint Invention shall mean any invention made by one
or more of Lucent's employees, contractors, consultants or agents
working on the Development Project jointly with one or more of
Company's employees, contractors, consultants or agents, which
Joint Invention is first conceived or first actually reduced to
practice during the Development Project.
(ii) The following provisions
shall apply only with respect to any Joint Invention:
(A) Lucent shall have the first
right to file a patent application in the United States on such
Joint Invention and it shall notify Company whether it elects to
file such application either before or at the time the development
project is complete.
(B) Company shall have the right
to file a patent application in the United States on such Joint
Invention in any case in which Lucent does not elect to file
pursuant to Section 2.05(ii)(A) hereof.
(C) The Party that elects to file
a patent application on such Joint Invention in the United States
shall have the first right of election to file a corresponding
patent application in each foreign country or, where applicable,
community of countries. Such Party shall notify the other Party of
those foreign countries, if any, in which it elects to file such
patent applications. The other Party shall have the right to file
patent applications on such Joint Inventions in all other foreign
countries.
(D) The expenses for preparing,
filing and prosecuting each application, and for issue of the
respective patents, shall be borne by the Party which prepares and
files the application, except that expenses associated with
official patent office fees, taxes, annuities and translation
costs, if applicable, shall be equally divided between Lucent and
Company, and paid as specified in Section 2.03(b)(ii)(E). The other
Party shall have the right to review and comment on each such
application prior to its filing, and shall furnish the filing Party
with all documents, information, or other assistance that may be
necessary for the preparation, filing and prosecution of each such
application.
(E) In the case of an application
for patent that is filed in a country that requires the translation
of the application or payment of taxes, maintenance fees or
annuities on a pending application or on an issued patent, the
Party that files the application shall pay such
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DEVELOPMENT AGREEMENT
taxes, maintenance fees or
annuities on the pending application or the issued patent and shall
invoice the other Party for one-half (1/2) of all such expenses,
which shall be payable by the other Party within thirty (30) days
of the invoice.
(F) In the event that a Party
does not wish to pay its share of expenses associated with a patent
application or an issued patent in any country as specified in
Section 2.03(b)(ii)(D), such Party shall notify the other Party in
writing of its refusal to share in such expenses, and shall assign
all its right, title and interest in such patent application or
issued patent in such country to the other Party, subject to
existing licenses and rights granted by such Party to third
parties. Concurrent with the execution by such Party of all
necessary documents associated with such an assignment, the other
Party shall grant to the Party and its Subsidiaries personal,
non-transferable, nonexclusive, royalty-free, licenses (with no
sublicensing rights) under such patent application or issued patent
to make, have made, use, lease, sell, offer for sale and import the
Licensed Product.
(G) Subject to the provisions of
Section 2.03(b)(ii)(F), the Parties shall each have an equal title
interest in each application and patent for such Joint Inventions,
with Company holding an undivided one-half (1/2) interest and
Lucent holding an undivided one-half (1/2) interest.
(H) Subject to the provisions of
Section 2.03(b)(ii)(F), each Party shall have the right to grant
nonexclusive licenses under applications and patents covering such
Joint Inventions, and each Party hereby consents to the granting of
such licenses by the other Party. Each Party shall have the right
to retain all royalties that it receives for granting licenses,
without accounting therefor to the other Party.
2.04 Patent
Licenses
(a) Upon payment of the
applicable fees as set forth in Appendix B3 and subject to the
provisions of this Agreement, Lucent hereby grants to Company
during the License Term, a personal, non-transferable (except as
permitted in Section 5.08) and non-exclusive license (without any
right to sublicense) under (a) patents and/or patent applications
listed in Appendix C, (b) patents on sole inventions (as defined in
Section 2.03(a) owned by Lucent, to (i) perform the Development
Project during the Development Period, and (ii) to make, have made,
use, lease, sell, offer to sell and import Licensed
Product.
(b) Upon payment of the
applicable fees as set forth in Appendix B3 and subject to the
provisions of this Agreement, Company hereby grants to Lucent
during the License Term, a personal, non-transferable (except as
permitted in
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DEVELOPMENT AGREEMENT
Section 5.08) and non-exclusive
license (without any right to sublicense) under (a) patents and/or
patent applications listed in Appendix C2, (b) patents on sole
inventions (as defined in Section 2.03(a) owned by Company, to (i)
perform the Development Project during the Development Period, and
(ii) to make, have made, use, lease, sell, offer to sell and import
Licensed Product.
(c) Licenses granted pursuant to
Sections 2.04(a) and 2.04(b) are not to be construed either (i) as
consent by the licensor to any act which may be performed by
licensee, except to the extent impacted by a patent licensed herein
to licensee, or (ii) to include licenses to contributorily infringe
or induce infringement under U.S. law or a foreign equivalent
thereof.
(d) Each Party agrees, upon
written request of the other Party, to grant to third parties,
personal, non-transferable and non-exclusive patent licenses
(without any right to sublicense) of similar scope as the licenses
set forth in Sections 2.04(a) and (b) above, if such third parties
are licensees of Developed Information belonging to the requesting
Party. Such third-party licenses shall be limited to (a) the
manufacture of Licensed Products by the third party and/or contract
manufacturers in the factories of the third party and/or contract
manufacturers, or (b) the sale of Licensed Products by the third
party. Such licenses will be governed by a separate patent license
agreement between the third party and the Party granting the
license, such agreement to contain reasonable and
non-discriminatory terms and conditions, including license fees not
to exceed six (6%) percent of the Fair Market Value of the Licensed
Products.
2.05 Licenses to
Technology
(a) Upon payment of the
applicable fees as set forth in Appendix B3 and subject to the
provisions of this Agreement, Lucent hereby grants to Company
during the License Term a personal, nontransferable (except as
permitted in Section 5.08) and nonexclusive, worldwide rights to
use and/or copy (a) Lucent Information and (b) any Developed
Information solely owned by Lucent, (i) for the purpose of
conducting the Development Project, (ii) for the manufacture of
Licensed Products either (A) by Company in the factories of
Company, or (B) by Contract Manufacturers for Company, and (iii)
for the sale of Licensed Products by Company.
(b) The rights granted to Company
pursuant to Section 2.05(a) may be sublicensed by Company to third
parties only upon written consent from Lucent, which consent will
not be unreasonably withheld. Any such sublicense shall contain
terms and conditions mutually agreed upon by the Parties, and shall
be subject to payment of applicable fees and royalties to Lucent,
as set forth in Section B1 in Appendix B3.
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DEVELOPMENT AGREEMENT
(c) Upon payment of the
applicable fees as set forth in Appendix B3 and subject to the
provisions of this Agreement, Company hereby grants to Lucent
during the License Term a personal, nontransferable (except as
permitted in Section 5.08) and nonexclusive, worldwide rights to
use and/or copy (a) Company Information and (b) any Developed
Information solely owned by Company, (i) for the purpose of
conducting the Development Project, (ii) for the manufacture of
Licensed Products either (A) by Lucent in the factories of Lucent,
or (B) by Contract Manufacturers for Lucent, and (iii) for the sale
of Licensed Products by Lucent.
(d) The rights granted to Lucent
pursuant to Section 2.05(c) may be sublicensed by Lucent to third
parties only upon written consent from Company, which consent will
not be unreasonably withheld. Any such sublicense shall contain
terms and conditions mutually agreed upon by the Parties, and shall
be subject to payment of applicable fees and royalties to Company,
as set forth in Section B2 of Appendix B3.
(e) After the expiration of the
Development Period, but during the License Term, Lucent's Bell Labs
Research Nanotechnology Lab personnel or Company may make
improvements to a MEMS-based magnetometer. Lucent, at its sole
discretion, may disclose these improvements to Company during a
mutually agreed upon semi-annual review between the Parties, and
make same available to Company pursuant to terms and conditions as
set forth in Sections 2.05(a) and 2.05(b).
(f) After the expiration of the
Development Period, but during the License Term, Company personnel
may make improvements to the Licensed Product. Company, at its sole
discretion, may disclose these improvements to Lucent during a
mutually agreed upon semi-annual review between the Parties, and
make same available to Lucent pursuant to terms and conditions as
set forth in Sections 2.05(c) and 2.05(d)
2.06 Co-Branding
.
The Parties agree to negotiate in
good faith with respect to a possible co-branding agreement
relating to the use of Lucent branding for Licensed
Products.
2.07 No Other Licenses
(a) No right is granted herein to
either Party to use any identification (such as, but not limited
to, trade names, trademarks, service marks or symbols, and
abbreviations, contractions or simulations thereof) owned by or
used to identify the other Party or any of its Subsidiaries or any
of its or their products, services or organizations, and that, with
respect to the subject matter of this Agreement, each Party agrees
it will not without the express written permission of the
other
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mPhase Technologies, Inc.
DEVELOPMENT AGREEMENT
Party (i) use any such
identification in advertising, publicity, packaging, labeling or in
any other manner to identify itself or any of its products,
services or organizations; or (ii) represent directly or indirectly
that any product, service or organization of the receiving Party is
a product, service or organization of the other Party or any of its
Subsidiaries, or that any product or service of such Party is made
in accordance with or utilizes any information of the other Party
or any of its Subsidiaries.
(b) Except as expressly set forth
herein, no other right or license is either granted or implied by
either party to the other with respect to any technical or business
information, or with respect to rights in any patents, trademarks,
copyrights, trade secrets, mask work protection rights, and other
intellectual property. Company further understands and agrees that
no rights or licenses under any third party information, software
or intellectual property is being furnished or granted by Lucent
hereunder and it shall be Company's sole responsibility to procure
any such rights or licenses (even if such a right or license is
necessary to exercise the rights expressly granted
herein).
ARTICLE III
TERM AND TERMINATION
3.01
Termination
(a) If a Party fails to fulfill
one or more of its material obligations or fails to perform or
observe any material term or condition under this Agreement, the
other Party may, upon its election and in addition to any other
remedies that it may have, at any time terminate this Agreement by
not less than thirty (30) days written notice to the Party
specifying any such breach, subject to 3.02 below unless within the
period of such notice, or such longer period as the Parties may
agree, all breaches specified therein shall have been
remedied.
(b) After payment of the initial
non-refundable payment specified in Appendix B2, either Party may
terminate this Agreement for convenience upon thirty (30) days
written notice to the other Party, subject to 3.02 below. Within
such thirty-day period, the Parties shall meet and agree on a
commercially reasonable wind up of the Development Project,
including but not limited to delivery of completed (or partial)
deliverables, and payment to Lucent for non-refundable costs and
expenses incurred (payment to be reduced by any unused prorate
portion of the initial non-refundable payment set forth in Appendix
B2(c) (i.e., $100,000per month).
3.02 Survival
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The rights and obligations of
Lucent and Company in Sections 2.01 through 2.06, 4.01, 4.02, 4.03,
4.04, 5.09, 5.10, 5.11 and Appendix B3 Section B4, shall survive
and continue after any such termination of this
Agreement.
ARTICLE IV
PROTECTION OF INFORMATION
4.01 Lucent and Company
Confidential Information
(a) Company and Lucent agree
that:
(i) Company will not use any of
Lucent Information, and that Lucent will not use any of Company
Information except as authorized herein;
(ii) Company shall hold all of
Lucent Information and Lucent shall hold all of Company Information
in confidence, and neither Party shall make any disclosure of any
or all of such other Party's information to anyone, except to its
employees, contractors, consultants and agents who have a need to
know, and to any others to whom such disclosure may be expressly
authorized hereunder and is necessary to implement the use
authorized hereunder, and that each Party shall appropriately
notify each person to whom any such disclosure is made that such
disclosure is made in confidence and shall be kept in confidence by
such person, and each Party shall keep a list of each person to who
any such disclosure is made;
(iii) the receiving Party will
not, without the disclosing Party's express written permission,
reverse engineer any of the furnished Lucent Information or Company
Information;
(iv) the receiving Party will
not, without the disclosing Party's express written permission,
make or have made, or permit to be made, more copies of any of the
furnished Lucent Information or Company Information than are
necessary for its use hereunder, and that each such copy shall
contain the same proprietary notices or legends that appear on the
furnished Lucent Information or Company Information being
copied;
(v) all of Lucent Information
shall remain the property of Lucent, and upon termination of this
Agreement, Company shall, at Lucent's written request, immediately
cease all use of Lucent Information and shall, as directed by
Lucent, promptly destroy or deliver to Lucent each and every part
specified by Lucent of Lucent Information then under Company or its
Subsidiaries' control;
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(vi) all of Company Information
shall remain the property of Company, and upon termination of this
Agreement , Lucent shall, at Company written request, immediately
cease all use of Company Information and shall, as directed by
Company, promptly destroy or deliver to Company each and every part
specified by Company of Company Information then under Lucent's or
its Subsidiaries' control; and
(vii) if this Agreement is
terminated by a Party for breach prior to completion of the
Development Project, then: (i) the terminating Party may retain and
use, in accordance with the terms and conditions of this Agreement,
Company Information or Lucent Information, as appropriate, for a
period of six (6) months from the date of termination, and (ii) the
breaching Party shall, at the terminating Party's written request,
immediately cease all use Company Information or Lucent
Information, as appropriate, and shall, as directed by the
terminating Party, promptly destroy or deliver to the terminating
Party each and every part specified by the terminating Party of
Company Information or Lucent Information, as appropriate, then
under the breaching Party's or its Subsidiaries'
control.
4.02 Joint
Information
(a) During the course of the
Development Project, the Parties will maintain a list of Developed
Information that is jointly owned pursuant to Section 2.02(b). All
such Develope
