Exhibit 10.1
SOFTWARE LICENSE
AGREEMENT
This Software License Agreement
(“ Agreement ”) is entered into this 27th day of
September, 2005 (the “ Effective Date ”) by and
between Innerwall, Inc., (“ Innerwall ”) a
Delaware corporation with principal offices at 4945 North 30th
Street, Colorado Springs, CO 80919 and Catcher, Inc., a Delaware
corporation with principal offices at 39526 Charlestown Pike,
Hamilton, VA 20158 (“ Catcher ”). Catcher and
Innerwall are sometimes collectively referred to herein as the
“parties.”
RECITALS:
WHEREAS , Catcher desires to purchase licenses to
Innerwall’s ENCLAVE™ software product, and Innerwall
desires to sell such licenses to Catcher in accordance with the
terms of this Agreement; and
WHEREAS , Innerwall desires to grant to Catcher, and
Catcher desires to receive from Innerwall, a non-exclusive license
to bundle and distribute the ENCLAVE™ software product, in
object code or executable (machine readable) format only, with
Catcher’s Catcher Device in accordance with the terms of this
Agreement;
NOW, THEREFORE
, based upon the foregoing premises
and the mutual covenants set forth herein and for other good and
valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, intending to be legally bound, the parties
hereby agree as follows:
1. Definitions
. The following terms, when used
with initial capital letters will have the meaning set forth below
unless the clearly context requires otherwise:
(a) “ Agent Module
” means the module incorporated in the Enclave software that
drives the Catcher Device acting as an agent.
(b) “ Applicable Patent
Rights ” means the claims in Innerwall’s U.S.
patents now issued or issued during the term of this Agreement
relating to Enclave, including without limitation, U.S. Pat.
No. 6,889,168, and U.S. Patent Applications Ser. No.’s
10/758,852, 10/687,320 and 11/100,714.
(c) “ Bundled Catcher
Device ” means the Catcher Device loaded with an embedded
Agent Module.
(d) “ Catcher Marks
” means Catcher’s trademarks and proprietary names used
to market the Catcher Device.
(e) “ Catcher Software
” means Catcher’s proprietary software included in the
Catcher Device.
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Portions of
this exhibit have been omitted and filed separately pursuant to an
application for confidential treatment filed with the Securities
and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
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(f) “ Catcher Distributor
Partners ” means resellers, distributors, value-added
resellers, systems integrators and OEM licensees or other entities,
each of which purchase Bundled Catcher Devices from Catcher for
resale to End Users.
(g) “ Catcher Third Party
Software ” means software that Catcher installs on the
Catcher Device licensed from a third party.
(h) “ Catcher Device
” means Catcher’s CATCHER™ portable command and
control hardware component together with all Catcher Software and
Catcher Third Party Software other than the Agent
Module.
(i) “ Console Module
” means the Innerwall module used with the Enclave software
that resides in a server or other computer that manages the Realm
Controller Modules as well as the Agent Module that reside in the
Bundled Catcher Device.
(j) “ Documentation
” means textual materials, including without limitation,
operating instructions, related technical information, and user
documentation relating to a party’s software.
(k) “ Enclave ”
means the ENCLAVE™ computer programming code in object or
executable (machine-readable) code form comprised of the following
software modules: (1) two or more Agent Modules, (2) one
or more Realm Controller Modules, and (3) one or more Console
Modules, together with the hardware upon which the Realm Controller
Module is installed, together with Documentation.
(l) “ End User ”
means an entity that has acquired a license to use Enclave with one
or more Bundled Catcher Devices for its own internal business
purposes under an End User Agreement.
(m) “ End User
Agreement ” means the agreement between Innerwall and an
End User concerning the End User’s use of Enclave together
with one or more Bundled Catcher Devices, such Agreement to be
entered into at the time the End User activates the Agent
Module.
(n) “ First Line
Support ” means the support that Catcher may provide End
Users, as set forth herein.
(o) “ Innerwall Marks
” means the trademarks and proprietary product names of
Innerwall used to market the ENCLAVE™ software
product.
(p) “ Marks ”
means collectively, the Innerwall Marks and the Catcher
Marks.
(q) “ Network Security
Products ” means software products that are used in the
analysis, management, monitoring, response, and restoration of
business computer networks. Software products that are not
competitive with Enclave, under the current release or any future
release, are not included in the definition of Network Security
Products.
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Portions of
this exhibit have been omitted and filed separately pursuant to an
application for confidential treatment filed with the Securities
and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
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(r) “ Order ”
means a document substantially in the form of the attached
Exhibit A for use by Catcher to order Support Services
as well as orders for Enclave submitted to Innerwall from End
Users. Each Support Services Order must reference and be solely
governed by this Agreement.
(s) “ Proprietary Data
” means any proprietary “know-how” which a
disclosing party discloses to a recipient relating to the
development or use of the disclosing party’s design,
structure, configuration, programming, and protocol of the
disclosing party’s software. “Know-how” may
include computer program designs, algorithms, subroutines, system
specifications, programming logic, manufacturing techniques, and
program architecture.
(t) “ Realm Controller
Module ” means the module incorporated in the Enclave
software that coordinates the Agent Modules in the Catcher Device
and communicates with the Console Module.
(u) “ Support Services
” means Innerwall’s technical support for the Agent
Module as Catcher may order under Innerwall’s Support
Services Agreement as set forth in Exhibit B.
(v) “ Term ”
means the Initial Term (as defined in Section 7) and any
Renewal Term (as defined in Section 7).
(w) “ Utilization
Report ” means Catcher’s quarterly report
identifying End Users, if any, to which Catcher sells Bundled
Catcher Devices, the names of Catcher Distributor Partners to which
Catcher has sold the Bundled Catcher Device, the and the fees due
hereunder for any of the foregoing from the previous quarter.
Catcher will require its Catcher Distributor Partners to submit to
Innerwall the name of End Users to which they sell Bundled Catcher
Devices if such Catcher Distributor Partners are permitted to do
so.
2. License Grants.
Each of the license grants below are
subject to this Agreement, including the payment of all associated
fees and the following limitations: (i) Catcher may not copy
Enclave, except as explicitly authorized below or for archival or
disaster recovery purposes, and if Catcher does copy Enclave for
these purposes, Catcher must preserve any patent markings and other
proprietary rights notices in Enclave and place the notices on any
and all copies Catcher has made or makes; (ii) Catcher will
not reverse engineer, decompile, disassemble, or otherwise attempt
to determine Enclave’s source code; (iii) Catcher may
modify Enclave in accordance with the Documentation solely to allow
for interoperability between Enclave and the Catcher Device; and
(iv) the licenses Catcher receives below are granted solely to
the extent of the Applicable Patent Rights and only to the extent
Catcher must have a license under Innerwall’s other
intellectual property rights to avoid infringement of the same and
to have the benefit of the rights granted to it under this
Agreement. Catcher may not create or attempt to create any
derivative works from Enclave. Except for the licenses granted
under this Agreement, ownership rights and, all intellectual
property rights in and to Enclave remains the sole and exclusive
property of Innerwall. Innerwall retains all rights not expressly
granted to Catcher in this Agreement. Catcher’s agreements
with Catcher Distributor Partners may not be inconsistent with or
less protective of, Innerwall’s proprietary and intellectual
property rights in Enclave than the protections and restrictions
set forth in this Agreement.
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Portions of
this exhibit have been omitted and filed separately pursuant to an
application for confidential treatment filed with the Securities
and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
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(a) Development Use License .
Innerwall grants Catcher a non-exclusive, non-transferable license
to use Enclave to (i) design, develop and test the Bundled
Catcher Device, and (ii) provide training for resellers and
End User concerning use of Enclave in respect of the Catcher
Devices (collectively, a “ Development Use License
”).
(b) Embedded Shipping Use
License . Innerwall grants Catcher a non-exclusive,
non-transferable license to (i) integrate and embed the Agent
Module of Enclave in the Catcher Device; (ii) to reproduce the
Agent Module of Enclave as it will be integrated into the Catcher
Device; and (iii) to sell, transfer, distribute and sublicense
the Agent Module of Enclave embedded in one or more Catcher Devices
to intermediaries for resale to End Users or sale directly to End
Users (collectively, an “ Embedded Shipping Use
License ”).
(c) Evaluation Use . Catcher
may grant intermediaries that may resell the Bundled Catcher Device
and End Users the right to evaluate the Bundled Catcher Device
without any additional license or the payment of any fees,
including without limitation, Support Services fees, it being
understood that if an End User activates the Agent Module, Catcher
will owe Innerwall the fees required by this Agreement. Catcher
will condition all such evaluations on compliance on the
evaluator’s agreement that it will not reverse engineer,
decompile, disassemble, or otherwise attempt to determine the
source code of the Agent Module.
(d) Restrictions .
(i) Catcher may not reproduce
Enclave in an amount exceeding the number of units to be sold to
intermediaries for resale to End Users or to End Users actually
receiving one or more Bundled Catcher Devices.
(ii) Catcher may not integrate or
bundle the Agent Module with any products or services other than
the Catcher Device without first obtaining Innerwall’s prior
written consent.
(iii) Innerwall will enter into an
End User Agreement with each End User that activates the Agent
Module. Catcher understands that such agreement will contain terms
and conditions that are no less restrictive than those contained in
this Agreement.
(e) Open Source License . One
Enclave component interfaces with an executable file (the “
Snort executable ”) that communicates with the Snort
1.8 - 2.x Host IDS Library software program (“ Snort
”). Snort is subject to the GNU General Public License. The
source code for Innerwall’s Snort executable is available for
download at www.innerwall.com/
. Innerwall grants Catcher a non-exclusive, non-transferable
license with respect to Innerwall’s Snort executable that is
coextensive with the other licenses granted by Innerwall under this
Agreement. The GNU General Public License is available for download
at www.opensource.org.
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Portions of
this exhibit have been omitted and filed separately pursuant to an
application for confidential treatment filed with the Securities
and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
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3. Reciprocal License to Use
Marks.
(a) Catcher may use the Innerwall
Marks in connection with its marketing and distribution of the
Bundled Catcher Device. Catcher’s use of the Innerwall Marks
must strictly adhere to Innerwall’s most recent written
guidelines on use of the Innerwall Marks PROVIDED THAT, a copy of
such guidelines are delivered to Catcher. If Catcher wishes to
deviate from the written guidelines from Innerwall, Catcher will
submit the proposed use of any Innerwall Mark to Innerwall for
Innerwall’s written approval before the use. Innerwall will
not unreasonably withhold, delay or condition approval.
Catcher’s use of the Innerwall Marks will inure to the
benefit of Innerwall.
(b) Innerwall may use the Catcher
Marks in connection with its marketing of the Bundled Catcher
Device subject to the parties agreeing on the terms and conditions
of such distribution. Innerwall’s use of the Catcher Marks
will strictly adhere to Catcher’s most recent written
guidelines provided that , a copy of such guidelines is
delivered to Innerwall. If Innerwall wishes to deviate from the
written guidelines from Catcher, Innerwall will submit the proposed
use of any Catcher Mark to Catcher for Catcher’s written
approval before the use. Catcher will not unreasonably withhold,
delay or condition approval. Innerwall’s use of the Catcher
Marks will inure to the benefit of Catcher.
4. Exclusive
Bundling.
For a period of 2 year(s) from
August 1, 2005, except as noted in this Section 4,
Catcher will not pre-load the Catcher Device with any other Network
Security Product other than that embedded in the operating system
software from Microsoft or any other operating system software
company and will promote Enclave as the preferred mobility
management Network Security Product for the Catcher Device.
Notwithstanding the foregoing, any Catcher Distributor Partners and
any End User may utilize a Network Security Product other than
Enclave without limitation. Except as stated in the first sentence
of this Section 4, nothing in this Agreement creates any
exclusive arrangement between Catcher and Innerwall. Either party
may distribute their respective products directly or indirectly
through their respective distribution channels. It is specifically
understood that Catcher may remove Enclave from the Catcher device
pursuant to a directive from any government customers and utilize
any competing Network Security Product.
5. Fees.
(a) Payment Terms . Enclave
license fees are set out on Schedule A . The license
and Support Services fees for each Order are due and payable upon
submission of Utilization Reports or the activation of Agent
Modules, as applicable. Innerwall may assess interest charges of
one percent (1%) per month for late payments. Catcher will
reimburse Innerwall for any costs incurred (including reasonable
attorneys’ fees) in the collection of Catcher’s past
due accounts if Innerwall is successful in such efforts. There is
no license or other fee of any nature whatsoever for the license
grants under this Agreement or the obligations of Innerwall under
this Agreement, except as set forth in Schedule A and in the
Support Services Agreement between the parties.
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Portions of
this exhibit have been omitted and filed separately pursuant to an
application for confidential treatment filed with the Securities
and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
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(b) Quarterly Utilization
Report . Except for Bundled Shipping Use Licenses, Catcher
agrees to provide Innerwall with a Utilization Report within 30
days after the end of each calendar quarter. The information
contained in each Utilization Report will be based upon the
activity in the previous calendar quarter. Each Utilization Report
will also include a calculation of commissions due to Innerwall
under Section 6.
(c) Audit . Innerwall may, at
its sole cost and expense and at any reasonable time during the
term of this Agreement but no more than once each fiscal quarter
during the Term and with no less than seven (7) days prior
written notice, request and gain access to Catcher’s premises
subject to Catcher’s security procedures, for the limited
purpose of conducting an audit to determine and verify that Catcher
is in compliance with these terms and conditions. Catcher will
promptly grant the access and cooperate with Innerwall in the
audit. The audit will be restricted in scope, manner and duration
to that reasonably necessary to achieve its purpose and may not
disrupt Catcher’s operations. Catcher will promptly contest
(in accordance with Section 15 of this Agreement) any findings
of the audit that it believes are not grounded in verifiable fact
and will promptly pay all other underpayments revealed by the
audit. If the audit reveals an uncontested discrepancy in excess of
five per cent (5%), Catcher will also be liable for the costs of
the audit.
(d) Taxes. Catcher will pay all
sales, use, VAT, and other consumption taxes, personal property
taxes and other taxes associated with the licenses granted
hereunder (other than those based on Innerwall’s net income)
unless Catcher furnishes satisfactory proof of exemption from such
taxes.
6. Mutual Commission on
Innerwall’s Sale of Bundled Catcher Devices and
Catcher’s Sale of Innerwall’s Enclave
. [To be the subject of additional
agreements between the parties.]
7. Term,
Termination.
(a) Term . Unless earlier
terminated, the initial term of this Agreement is 2 year(s) from
the Effective Date (the “Initial Term”). The Initial
Term will automatically renew for an unlimited number of successive
one-year terms (each a “Renewal Term”), provided,
however, that in any Renewal Term, either party may terminate this
Agreement by giving at least 60 days’ advance written notice
of termination.
(b) Termination . Either
party may terminate this Agreement at any time immediately upon
written notice to the other party if the other party is in material
default of this Agreement. A party is in material default of this
Agreement if it (i) files or has filed against it a petition
in bankruptcy, makes a general assignment for the benefit of its
creditors, has a receiver or trustee appointed for its business,
properties or assets, or ceases to do business in the ordinary
course or (ii) fails to perform in a material way any of its
material duties or obligations, and does not undertake an effort to
substantially cure and substantially cure the default within 30
days after written notice is given to the defaulting party. In
addition, a party may immediately terminate this Agreement with out
opportunity for cure upon a breach of Section 14. Upon
termination of this Agreement, all licenses granted under this
Agreement will automatically terminate.
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Portions of
this exhibit have been omitted and filed separately pursuant to an
application for confidential treatment filed with the Securities
and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
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(c) Effect of Termination .
Notwithstanding the foregoing, any Development Use Licenses, and
Embedded Shipping Use Licenses with respect to Catcher’s
inventory (including work-in-process) of Catcher Devices and
Bundled Catcher Devices sold prior to such termination, will remain
in effect and not be affected by such termination so long as such
licenses are used in accordance with their respective license
grants contained herein. Each recipient of Confidential Information
must return to the disclosing party such Confidential Information
except as needed for continued support under this
Agreement.
8. Software
Support.
(a) Catcher’s Support to
End Users . Catcher Distributor Partners are responsible for
providing, directly or indirectly, First Line Support to each End
User.
(b) Innerwall’s Support to
Catcher . Support Services ordered by Catcher will be provided
under the then current version of Innerwall’s Support
Agreement in effect on the date Support Services are ordered. A
form of Innerwall’s Support Agreement as of the Effective
Date is attached to this Agreement as Exhibit B . In no
event will the fees associated with the Support Agreement increase
during the Term without Catcher’s prior written
consent.
(c) Training . Within 90 days
of the execution of this Agreement, Innerwall will provide 5 days
of free training for employees of Catcher designated by Catcher.
Catcher is responsible for travel and expense costs of Catcher
personnel to Innerwall facilities in Colorado. If Catcher requests
that training take place at Catcher’s facilities and
Innerwall agrees, then Catcher will be charged for the time of
Innerwall’s personnel, travel, hotels, and other associated
costs for Innerwall’s personnel, as well as training
facilities and associated costs, provided that all such costs and
expenses are first consented to in writing by Catcher. Innerwall
will provide Catcher with a training manual that both parties agree
is sufficient for Catcher’s internal use within 20 days of
the signing of this agreement.
9. Protection of Intellectual
Property.
(a) Use of Marks . Catcher
will use its commercially reasonable efforts to protect
Innerwall’s, its licensors’ and suppliers’
intellectual property and proprietary rights in the Innerwall
software, Proprietary Data, Innerwall Marks, and other intellectual
property of Innerwall. Innerwall will use its commercially
reasonable efforts to protect Catcher’s, its
licensors’, and suppliers’ intellectual property and
proprietary rights in the Catcher Software, Proprietary Data,
Catcher Marks, and Catcher’s other intellectual property. If
the management of Catcher becomes aware of the unauthorized use,
copying, or disclosure of the Innerwall Software, Innerwall Marks,
or Innerwall’s Proprietary Data, Catcher will notify an
Innerwall representative in writing. Catcher will assist Innerwall,
at Innerwall’s request and expense, in the investigation and
prosecution of the unauthorized use, copying, or disclosure. If the
management of Innerwall becomes aware of the unauthorized use,
copying, or disclosure of Catcher Software, Catcher Marks, or
Catcher’s Proprietary Data, Innerwall will notify a
Catcher’s Chief Executive Officer in writing. Innerwall will
assist Catcher, at Catcher’s request and expense, in the
investigation and prosecution of the unauthorized use, copying, or
disclosure.
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Portions of
this exhibit have been omitted and filed separately pursuant to an
application for confidential treatment filed with the Securities
and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
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(b) Patent Marking . The
Agent Module, its Documentation, or other Enclave materials
supplied by Catcher with the Bundled Catcher Device (and not
provided by Innerwall) should be marked with the patent numbers and
patent application numbers included in the definition of Applicable
Patent Rights to the extent necessary to protect Innerwall’s
patent rights in Enclave but only to the extent Enclave materials
are so marked by Innerwall. Catcher will ensure that
Innerwall’s patent marking is maintained within Enclave and
its Documentation in the same form and location as supplied by
Innerwall.
10. Warranties,
Disclaimer.
(a) Authority . Each party
represents and warrants to the other party that it has the full
right, power and authority to enter into this Agreement and to
carry out its obligations under this Agreement.
(b) No Third-Party Warranty .
NEITHER PARTY MAKES ANY WARRANTIES CONCERNING ANY THIRD PARTY
SOFTWARE AND HAS NO OBLIGATION TO INDEMNIFY, DEFEND OR HOLD
HARMLESS THE OTHER PARTY WITH RESPECT TO THIRD PARTY
SOFTWARE.
11.
Indemnification.
(a) Indemnity by Catcher .
Subject to the liability, remedy and damage limitations set forth
in this Agreement, Catcher will indemnify and hold harmless
Innerwall and its parent and affiliates, its and their successors
and assigns and its and their shareholders, officers, directors,
agents, employees and contractors, (collectively, the
“Innerwall Indemnitees”) from and against any and all
loss or liability of any nature whatsoever cognizable at law
(collectively, “Losses”) resulting from third-party
claims (including governmental entities) against a Innerwall
Indemnitee, that may be asserted against the Innerwall Indemnitee
by such third party, arising out of the breach by Catcher of its
obligations under this Agreement or any wrongful act of Catcher in
connection with any sale by Catcher of ENCLAVE™.
(b) Indemnity by Innerwall .
Subject to the liability, remedy and damage limitations set forth
in this Agreement, Innerwall will indemnify and hold harmless
Catcher and its parent and affiliates, its and their successors and
assigns and its and their shareholders, officers, directors,
agents, employees and contractors, (collectively, the
“Catcher Indemnitees”) from and against any and all
loss or liability of any nature whatsoever cognizable at law
(collectively, “Losses”) resulting from third-party
claims (including governmental entities) against a Catcher
Indemnitee, that may be asserted against the Catcher Indemnitee by
such third party, arising out of: (i) the breach by Innerwall
of its obligations under this Agreement and (ii) without
limiting Innerwall’s obligations under Section 12,
below, Innerwall IP Claims.
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Portions of
this exhibit have been omitted and filed separately pursuant to an
application for confidential treatment filed with the Securities
and Exchange Commission pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
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(c) Processing Indemnity
Claims . Whenever a third party makes a claim indemnified
hereunder against a Catcher Indemnitee or Innerwall Indemnitee (the
“Indemnified Party,” as the case may be), upon receipt
of such claim, the Indemnified Party will promptly give to the
other party (the “Indemnifying Party”) notice thereof
and will, at no out-of-pocket expense to the Indemnified Party,
cooperate with the Indemnifying Party with respect to the
investigation and defense or settlement of such matter. The
Indemnifying Party will, at it’s expense, including
reasonable attorneys’ fees, defend an Indemnified Party
against claims for Losses, whether or not frivolous, that may be
asserted against an Indemnified Party by such third party, The
Indemnified Party shall have the right, without affecting its
indemnity hereunder, to participate in the administration, defense
and settlement of such matter at its own cost and expense and with
counsel of its own choosing, but the Indemnifying Party will have
the right in its sole, absolute, discretion to control such
administration, defense and settlement in all aspects. The
Indemnifying Party will have the sole, absolute right to settle the
indemnified claim solely for money to be paid wholly by the
Indemnifying Party. Any other settlement may be offered or made
only with the prior written consent of the Indemnified Party, and
the indemnified claim may, in all events, be settled only upon
obtaining a full and unconditional release of the Indemnified
Party.
12. Third Party Claims of
Infringement.
If Catcher receives notice of any
claim that Enclave, or any module thereof, infringes a third
party’s United States patent or copyright or other
intellectual property rights (an “Innerwall IP Claim”),
Catcher will promptly give written notice of the Innerwall IP Claim
to Innerwall in accordance with this Agreement. Innerwall, at its
sole cost and expense, shall promptly investigate all such
Innerwall IP claims. If Innerwall determines that the Innerwall IP
Claim has merit, Innerwall may in its discretion instruct Catcher
to cease the sale of Bundled Catcher Devices. Innerwall has no
obligation to indemnify Catcher for any sales that occur after
Innerwall has instructed Catcher to cease selling Bund