Exhibit 10.5
INTELLECTUAL PROPERTY LICENSE
AGREEMENT
By & between
Monitor Dynamics, Inc.
(“Licensor”)
&
MDI, Inc.
(“Licensee”)
This INTELLECTUAL PROPERTY LICENSE
AGREEMENT (“Agreement”) is dated as of
September 8, 2009 (the “Effective Date”) between
Monitor Dynamics, Inc., a Texas corporation
(“Licensor”), and MDI, Inc, a Delaware corporation
(“Licensee”). Licensor and Licensee are sometimes
referred to herein individually as, “Party” and
collectively as, the “Parties.”
I.
RECITALS
WHEREAS, prior to the execution of
this Agreement, Licensee was the owner of all of the issued and
outstanding capital stock of Licensor. Licensor was a newly-formed,
wholly-owned subsidiary of Licensee which was organized to acquire,
and has so acquired, the business assets and liabilities previously
held by Licensee, as described in the Contribution Agreement
between Licensor and Licensee of even date herewith;
WHEREAS, prior to the execution of
this Agreement, Licensee, and a newly-formed wholly-owned
subsidiary of Licensee (“Merger Sub”), entered into an
Agreement and Plan of Merger (the “Merger Agreement”)
with Almana Networks International, a Delaware corporation
(“ANI”), pursuant to which Merger Sub was merged with
and into ANI with ANI being the surviving entity (the
“Merger”);
WHEREAS, contemporaneously with the
closing of the Merger, Licensee intends to split-off Licensor,
through the sale of all of the outstanding capital stock of
Licensor upon the terms and conditions of a Stock Purchase
Agreement (the “Stock Purchase Agreement”) of even date
herewith by and among Licensee and 214 Investments, Inc., a
Texas corporation (“Purchaser”);
WHEREAS, the Stock Purchase
Agreement contemplates that the Licensor will license certain
intellectual property to Licensee, namely, the Licensed IP (as
defined herein); and
WHEREAS, Licensee desires to obtain
the right and license to use the Licensed IP upon the terms and
conditions set forth herein.
NOW THEREFORE, in consideration of
the foregoing premises, and for other good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged, the Parties hereto hereby covenant and agree as
follows:
I.
DEFINITIONS: Whenever used in this Agreement, the following terms
have the meanings respectively assigned to them in this
Section:
(a) “Affiliate”
means a Person who directly or indirectly through one or more
intermediaries, controls, or is controlled by or is under common
control with, the Person specified.
(b) “Control”
means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a
Person whether through the ownership of voting securities, by
contract, or otherwise.
(c) “Person” means
an individual, firm, partnership, joint venture, corporation, bank,
trust, unincorporated organization or governmental body.
(d) “Licensed IP”
means Safenet 6.2.16.SP3 sold, assigned and contributed to
the Licensor pursuant to the Contribution Agreement together with
the media, supporting documentation , instructions and manuals
regarding the use of such Licensed IP. As used in this Agreement,
the term “Intellectual Property” expressly excludes
Trademarks.
II.
LICENSE GRANT
2.1.
License Grant. From and after the Effective Date, Licensor hereby
grants to Licensee, and Licensee hereby accepts from Licensor,
subject to any licenses previously granted to third parties, a
perpetual, irrevocable, world-wide, fully paid-up, royalty-free
license to use the Licensed IP to make, have made, use, offer for
sale, promote, distribute, sell and otherwise commercially exploit
the Licensed IP. Such license includes, without limitation, the
right to distribute, and create derivative works from any
copyrighted materials included in Licensed IP, the right to make,
have made, use, offer for sale, promote, distribute, sell and
otherwise commercially exploit any such derivative works and the
right to use any trade secrets and know-how included in Licensed
IP.
2.2.
Copies. Licensee may make such number of copies of the applicable
Licensed IP as is reasonably necessary to accomplish the permitted
uses set forth in Section 2.1. All copies shall be subject to
the terms and conditions of this Agreement.
2.3.
Exclusion of All Other Rights. Except as expressly provided herein,
Licensee is granted no rights or licenses whatsoever in or to the
Licensed IP or any other Licensor products, services or other
Licensor intellectual proprietary or personal rights. Licensor
hereby expressly reserves all rights and licenses not expressly
granted in this Agreement. In particular and without limiting the
foregoing, nothing in this Agreement will be deemed to convey to
Licensee the legal title to any Licensed IP.
2.4.
Right to Sublicense. Licensee shall be free to grant sublicenses to
any majority-owned subsidiary or Affiliate of Licensee for so long
as such Person remains a majority-owned subsidiary or an Affiliate
of Licensee. Any such sublicense shall be subordinate to and
conform to the terms and conditions of this Agreement, and shall
not include the right for such sublicensee to grant sublicenses to
persons who are not also majority-owned subsidiaries or Affiliates
of Licensee. Licensee shall also be free to grant sublicenses to
persons who are not majority-owned subsidiaries or Affiliates of
Licensee to the extent necessary to exercise its “have
made” rights as provided in Section 2.1. Any such
sublicense shall be subordinate to and conform to the terms and
conditions of this License; shall not include the right for such
sublicensee to grant sublicenses to other persons; and shall not
include the right for such sublicensee to make, sell or distribute
products made using the Licensed IP for such sublicensee’s
own account or the account of any person other than Licensee or a
majority-owned subsidiary or Affiliate of Licensee. In addition,
Licensee shall require that any such sublicensee implement and
maintain practices and policies sufficient to preserve the
confidentiality of all Licensed IP provided to such sublicensee by
Licensee, and Licensee shall be solely responsible, as between
Licensee and Licensor, for any breach of confidentiality with
respect to the Licensed IP by any such sublicensee. Except as
expressly set forth in this provision, Licensee shall not, without
the prior written approval of Licensor, which approval shall not be
unreasonably withheld, delayed, or conditioned, sublicense or
transfer in any way any Licensed IP.
2.5.
Intellectual Property Notices and Markings. Licensee shall
accurately produce and reproduce all Licensor intellectual property
notices on all copies Licensee produces or reproduces of the
Licensed IP.
III.
OWNERSHIP
3.1.
Licensed IP. Licensee acknowledges and agrees that, as between the
Parties and subject to the rights and licenses granted herein,
Licensor is, and at all times shall remain, the sole and exclusive
owner of all right, title and interest, throughout the world
(including all intellectual property and other proprietary rights),
in and to all Licensed IP, and any copies of the Licensed IP,
whether made by or on behalf of Licensor or Licensee.
3.2
Derivative Works. Licensor acknowledges and agrees that, as between
the Parties, any derivative works of Licensed IP created by or on
behalf of Licensee are and shall remain the sole and exclusive
property of Licensee.
IV.
PROTECTION OF LICENSED TECHNOLOGY
4.1.
Protection of Intellectual Property Rights.
(a) Licensor and the Licensee
shall cooperate to police diligently the Licensed IP. The Parties
shall promptly notify each other in writing of any unauthorized
use, infringement, misappropriation, dilution or other violation of
the Licensed IP of which it becomes aware.
(b) Licensor shall have the
primary right, but not the obligation, to bring and control any
suits against any unauthorized use, infringement, misappropriation,
dilution or other violation of the Licensed IP. Licensee agrees to
cooperate with Lic
