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EXHIBIT 10.3
ADDENDUM #1 TO
LICENSING AND DISTRIBUTION AGREEMENTS
(2004-2005 AND 2005-2007)
THIS ADDENDUM #1 TO LICENSING AND DISTRIBUTION AGREEMENTS (this
"Addendum") is dated as of April 13, 2004
("Effective Date"), by and between
Encore Software, Inc., a Minnesota
corporation ("Distributor"), and RIVERDEEP
INC., A LIMITED LIABILITY COMPANY, a
Delaware limited liability company
("Riverdeep"), with respect to the
following Recitals.
A.
Distributor and Riverdeep have entered into (i) that certain
Licensing and Development Agreement
(Manufacturing Rights)(2004-2005), dated as
of March 29, 2004 ("Agreement One"), and
(ii) that certain Licensing and
Development Agreement (Manufacturing
Rights)(2005-2007), dated as of March 29,
2004 ("Agreement Two", and together with
Agreement One, the "Agreements"; each
initially-capitalized term used herein and
not otherwise defined shall have the
meaning ascribed to such term in the
Agreements), pursuant to which, among other
things, Riverdeep has granted Distributor
exclusive rights to replicate, sell,
and distribute the Products into the
Channel and the Territory, as more
particularly described in each of the
Agreements.
B.
Riverdeep currently distributes some or all of the Products
into the Channel through certain agreements
with COKeM and has requested
Distributor's consent to maintain such
agreements in effect through the
expiration of their terms, or earlier
termination. Distributor is willing to
agree to such arrangements upon the terms
and subject to the conditions set
forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements
contained herein, and for other good and
valuable consideration the receipt and
sufficiency of which are hereby
acknowledged, the parties agree as follows:
1.
CERTAIN DEFINITIONS. As used herein, the following
initially-capitalized terms shall the
meaning ascribed to them below.
1.1 "COKeM"
means COKeM International, Ltd., and any of its
permitted successors or assigns under the
COKeM Agreements.
1.2 "COKeM
Agreements" has the meaning ascribed to such term in
Section 2.1 below.
1.3 "COKeM
Inventory" means COKeM's on-hand inventory of finished
units of the Products (as defined in either
of the Agreements) in COKeM's
possession or control as of December 31,
2004, but only if and to the extent
that any such inventory is repurchased by
Riverdeep as of such date.
1.4 "COKeM
Products" means any and all products to which COKeM has
been granted rights under the COKeM
Agreements.
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2.
COKeM AGREEMENTS; SELL-OFF AND INVENTORY PURCHASE.
2.1 Riverdeep
hereby represents and warrants to Distributor that
(i) attached hereto as Exhibit A is a true
and correct schedule of all of the
agreements between Riverdeep and COKeM in
effect as of the date hereof other
than the agreement with COKeM set forth on
Exhibit C of Agreement One (such
agreements being collectively referred to
as the "COKeM Agreements), true,
correct, and complete copies of which have
heretofore been provided to
Distributor; (ii) there are no extensions,
supplements, amendments or other
modifications ("Modifications") to any of
the COKeM Agreements; and, (iii)
notwithstanding the provisions of each of
the COKeM Agreements, COKeM currently
has no ability to manufacture any of the
COKeM Products.
2.2 From and
after the date hereof until the expiration or sooner
termination of all of the COKeM Agreements,
Riverdeep shall (i) perform all of
Riverdeep's obligations under the COKeM
Agreements (except to the extent
Distributor is responsible therefor
hereunder) and shall not enter into or
otherwise agree to any Modifications
thereto without Distributor's prior written
consent, to be granted or denied in
Distributor's sole discretion; (ii) not
waive any of COKeM's obligations, grant any
additional rights, or give any
consents or approvals to COKeM, under any
of the COKeM Agreements without
Distributor's prior written consent, to be
granted or denied in Distributor's
sole discretion; and, (iii) provide,
supply, and fulfill all COKeM Products to
COKeM solely in accordance with the terms
of this Addendum.
2.3 Riverdeep
hereby appoints Distributor its exclusive inventory
manager to manage, fulfill, and process all
purchase orders for COKeM Products
that Riverdeep receives from COKeM from and
after April 13, 2004, until the
expiration or sooner termination of all of
the COKeM Agreements. To that end, in
respect of the COKeM Agreements,
Distributor shall fill purchase orders received
by Riverdeep from COKeM; assist in
inventory management; subject to the
reimbursement herein, arrange for the
manufacture of all finished goods of COKeM
Products so ordered; and process and ship
such units to such locations directed
by Riverdeep. Unless otherwise agreed to
between the parties, Riverdeep shall
remain the point of contact with COKeM. In
addition, Riverdeep shall remain
directly responsible and solely liable (i)
for collecting all amounts due under
the COKeM Agreements and shall remain
entitled to collect all amounts in
connection therewith, and (ii) for all
amounts due under, and for all
liabilities associated with, the COKeM
Products or COKeM Agreements. Riverdeep
shall cooperate with Distributor in order
to enable Distributor to carry out its
obligations hereunder.
2.4 No later
than 30 days after each month, Riverdeep shall
reimburse Distributor, or Distributor in
its sole discretion may deduct from
amounts otherwise payable by Distributor to
Riverdeep, all direct costs, fees,
charges, and expenses incurred or owed by
Distributor to manufacture, process,
fulfill, handle, and ship all COKeM
Products during such period in accordance
with Riverdeep's obligations under the
COKeM Agreements (including, without
limitation, cost of goods, shipping,
handling, and insurance to the extent
applicable). In addition, Riverd
