Tags: 1m, covenants, documentation notes, effective date, goodman, including without limitation, innovators, intellectual property rights, moral rights, north goodman street, patent rights, patents, phrases, recitals, representations, rochester new york, sharing program, signatures, textwise, warranties,
(To be executed only by a designated winner of the challenge)
TextWise LLC
Revenue Sharing Agreement
This Revenue Sharing Agreement (this "Agreement"), dated as of ___ day of _____ 2008
(the "Effective Date"), is entered into between TextWise, LLC ("TextWise") having an address
at 274 North Goodman Street, Rochester, New York 14607 and ______ ("Entrant"), a[n]
[corporation] [individual] having an address at ________ (each a "party" and collectively the
"parties").
RECITALS
WHEREAS, TextWise has sponsored the SemanticHacker $1M Innovators' Challenge
for the purpose of encouraging the development of applications using TextWise's Semantic
Signatures® and TSV technologies; and
WHEREAS, Entrant's application has been selected by Sponsor to participate in a
revenue sharing program and in consideration for assignment of Entrant's entire rights, title and
interest in and to such application, TextWise will share a percentage of revenue derived from
Entrant's application on the terms and the conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants and agreements, and upon the terms set forth herein, the parties hereby agree as
follows:
A G R E E M E NT
1. Definitions.
For the purposes of this Agreement, the parties hereby acknowledge and agree that the
following terms and phrases shall have these meanings:
"Application" means the application submitted by Entrant to the SemanticHacker $1M
Innovators' Challenge as set forth in Exhibit A, including without limitation all source and object
code thereto; as well as any documentation, notes, records, files or tangible items of any sort
relating to the Application.
"Intellectual Property Rights" means all patents, patent rights, copyrights, moral rights,
publicity rights, trademark, trade dress and service mark rights, goodwill, trade secret rights and
other intellectual property rights as may now exist or hereafter come into existence and all
applications, registrations, renewals, extensions related thereto, under the laws of any state,
country, territory or other jurisdiction.
"Net Revenues" means the actual amounts received by TextWise for the sale or license of
Application, less the following to the extent not previously deducted: (i) customary trade,
quantity or cash discounts; (ii) refunds, replacements and credits for returns; (iii) any taxes or
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other governmental charges levied on the production, sale, transportation, delivery, or use of a
Application; provided however that Net Revenues will not include the price of any ancillary or
other software product bundled or sold with the Application.
2. Assignment; Delivery
2.1 Assignment. Entrant hereby irrevocably assigns, sells, transfers and conveys to
TextWise on a worldwide basis all right, title and interest throughout the world in or to the
Application and the technology and intellectual property described in Exhibit A, including,
without limitation, any tangible manifestations thereto, and any Intellectual Property Rights,
moral rights, contract or licensing rights, or other analogous rights throughout the world
(collectively, the "TextWise Property"). Entrant acknowledges that Entrant retains no right to
use the TextWise Property and agrees not to challenge the validity of TextWise's ownership of
the TextWise Property.
2.2 Delivery. Entrant agrees to deliver to TextWise any and all additional tangible
manifestation of the Application not previously provided, including, without limitation, any
source or object code, documentation, notes, records, files or tangible items of any sort relating
to the Application upon the Effective Date.
2.3 Additional Acts. Upon the request of TextWise and at TextWise's reasonable
expense, Entrant will promptly: (a) execute documents and perform such other acts as TextWise
may deem reasonable to procure, maintain, perfect, and enforce the TextWise Property on a
world wide basis; and (b) render reasonable assistance to TextWise in applying for and obtaining
in TextWise's name and for its benefit, intellectual property protection for the TextWise
Property, including, without limitation, patents, copyrights, trademarks, trade secrets, and all
other intellectual property rights throughout the world. If TextWise is unable after reasonable
effort to secure Entrant's signature on any document needed in connection with this Section,
Entrant hereby irrevocably designates and appoints TextWise as its agent and attorney in fact,
which appointment is coupled with an interest, to act for and in Entrant's behalf to execute,
verify and file any such documents and to do all other lawfully permitted acts to further the
purposes of this Section with the same legal force and effect as if executed by Entrant.
3. Consideration; Taxes.
3.1 Consideration. As consideration of the foregoing assignment and cooperation,
TextWise hereby agrees to pay Entrant the following: (a) one hundred thousand dollars (US
$100,000) after delivery of the Application pursuant to Section 2.2; and (b) fifty percent (50%)
of Net Revenues of Applications payable on a quarterly basis during the first year following the
release of the application to the market; provided that the maximum amounts payable to Entrant
under this Section 3.1 (a) and (b) shall be one million dollars (US $1,000,000).
3.2 No Minimum or Multiple Payments. There shall be no minimum payments due to
Entrant and there shall be no multiple payments to Entrant on the same Application under this
Agreement or any other agreement between the parties.
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3.3 Taxes. All payments made by TextWise to Entrant under this Agreement shall be
the total amount and will be inclusive of all taxes (including, without limitation, sales and value
added taxes) tariff, duty or assessment levied or imposed by the government of any jurisdiction
in respect of any licenses or rights granted hereunder. Entrant acknowledges and agrees that
TextWise has made no representations to him regarding the tax consequences of any amounts
received by him pursuant to this Agreement and that the fees paid under this Agreement may be
considered taxable income and subject to disclosure to the appropriate taxing authorities. Entrant
agrees to pay federal or state taxes which are required by law to be paid with respect to the
payments under this Agreement. Entrant further agrees to indemnify and hold TextWise
harmless from any claims, demands, deficiencies, levies, assessments, executions, judgments or
recoveries by any governmental entity against TextWise for any amounts claimed due on
account of this Agreement or pursuant to claims made under any federal or state tax laws, and
any costs, expenses or damages sustained by TextWise by reason of any such claims, including
any amounts paid by TextWise as taxes, attorneys' fees, deficiencies, levies, assessments, fines,
penalties, interest or otherwise.
4. Representations and Warranties; Limitations of Liability.
4.1 Representations and Warranties. Entrant represents, warrants and covenants to
TextWise that: (a) there are no liens, mortgages, commitments, obligations and encumbrances of
any kind or any nature whatsoever against the Application; (b) Entrant is the sole owner of the
Application and has full power to perform its obligations as set forth in this Agreement; (c)
Entrant has not licensed or assigned the Application to any third party; (d) Entrant has acquired
from all authors, creators and inventors all right, title and interest in the Application; (e) the
Application does not infringe the Intellectual Property Rights or other proprietary rights of any
third party; and (f) the Application contains no virus, worm, built-in or use-driven destruction
mechanism, injurious or damaging algorithm, time bomb, trojan horse or other software or
hardware that can disable, damage, erase or adversely affect the Application or its operation or
intended purpose disable, damage or adversely affect Application, or destroy disable, damage,
erase or adversely affect any of TextWise's data, systems, processes, business methods,
hardware or other software; (g) Entrant has maintained the TextWise Property in confidence and
has not disclosed the TextWise Property to any third party; (h) following the execution of this
Agreement, no person or entity other than TextWise retains any right, title or interest in or to any
TextWise Property or retains any tangible manifestations of any TextWise Property in its
possession or control; and (i) this Agreement does not conflict with, constitute a breach of, or in
any way violate any arrangement, understanding or agreement by which Entrant is bound.
Entrant shall defend, indemnify and hold harmless TextWise against any judgment, loss,
damage, claim or expense arising out of any breach by Entrant of any representation or warranty
set forth herein.
4.2 Limitation of Liability. IN NO EVENT SHALL TEXTWISE BE LIABLE TO
ENTRANT FOR SPECIAL, INDIRECT, INCIDENTAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL LOSS OR DAMAGES OF ANY NATURE WHATSOEVER
CONNECTED WITH OR RESULTING FROM THE PERFORMANCE OR NON-
PERFORMANCE OF THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO
DAMAGES OR CLAIMS IN THE NATURE OF LOST REVENUE, INCOME OR PROFITS
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OR LOSS OF USE, OR LOST BUSINESS OPPORTUNITY, IRRESPECTIVE OF WHETHER
SUCH DAMAGES ARE REASONABLY FORESEEABLE AND REGARDLESS OF
WHETHER TEXTWISE HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES OR NOT. For purposes of clarification, TextWise shall have no liability for the
success or failure of its development, sales, marketing, licensing, distribution or other
exploitation of the Application and Entrant hereby agrees and acknowledges that Entrant may
not receive any additional monies from TextWise except for the initial $100,000 payment.
Entrant hereby acknowledges Section 4.2
5. Confidentiality. The TextWise Property is the confidential and proprietary information
of TextWise. Entrant has maintained the TextWise Property in confidence and has not disclosed,
or granted any rights in or to the TextWise Property, to any third party. Entrant will not disclose
the TextWise Property to any third party without the prior written permission of Textwise, and
will protect the TextWise Property from unauthorized use, access, or disclosure in the same
manner as Entrant protects its own confidential or proprietary information of a similar nature, but
with no less than reasonable care. Entrant's obligations in this Section will not apply to any
TextWise Property that is or, through no fault of Entrant, becomes generally available to the
public. In addition, Entrant will be allowed to disclose the TextWise Property to the extent that
the disclosure is necessary for Entrant to enforce its rights under this Agreement in connection
with a legal proceeding, or otherwise required by the order or a court or governmental entity,
provided that Entrant notifies TextWise in writing in advance of the disclosure and cooperates
with TextWise in seeking to limit the scope of such required disclosure.
6. Term. This Agreement will become effective as of the Effective Date and, unless sooner
terminated as otherwise provided herein, or as otherwise mutually agreed, shall remain effective
for a period of twelve (12) months from the date that the Application is made publicly available
by TextWise; provided that Sections 1, 2, 4, 5, 6 and 7 shall survive any termination or
expiration of this Agreement.
7. Miscellaneous.
7.1 Entire Agreement; Amendments. This Agreement constitutes the entire
agreement among the parties with respect to the subject matter hereof and supersede all prior
agreements and understandings, both written and oral, among the parties with respect to the
subject matter hereof. This Agreement may be amended or waived only with the written
consent of both Entrant and TextWise.
7.2 Severability. In the event that any provision of this Agreement or the application
thereof, becomes or is declared by a court of competent jurisdiction to be illegal, void or
unenforceable, the remainder of this Agreement will continue in full force and effect and the
application of such provision to other persons or circumstances will be interpreted so as
reasonably to effect the intent of the parties hereto. The parties further agree to replace such void
or unenforceable provision of this Agreement with a valid and enforceable provision that will
achieve, to the extent possible, the economic, business and other purposes of such void or
unenforceable provision.
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7.3 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, regardless of the laws that might otherwise
govern under applicable principles of conflicts of law thereof.
7.4 Notices. Any notice required or permitted by this Agreement shall be in writing
and shall be deemed effective upon delivery, when delivered personally or by overnight courier
or sent by facsimile, or 48 hours after being deposited in the U.S. mail, as certified or registered
mail, with postage prepaid, and addressed to the party to be notified at such party's address or
facsimile number as set forth on the signature page, or as subsequently modified by written
notice.
7.5 No Waiver. No failure or delay on the part of any party hereto in the exercise of
any right hereunder will impair such right or be construed to be a waiver of, or acquiescence in,
any breach of any representation, warranty or agreement herein, nor will any single or partial
exercise of any such right preclude other or further exercise thereof or of any other right.
7.6 Arbitration. Any dispute, claim or controversy of any kind arising in connection
with, or relating to, this Agreement, shall be resolved exclusively by binding arbitration in
accordance with the Judicial Arbitration and Mediation Services/Endispute ("JAMS") in
Rochester, New York or such other location serviced by JAMS which is mutually acceptable to
the parties, in accordance with JAMS commercial rules of arbitration.
7.7 Counterparts. This Agreement may be executed in one or more counterparts, and
by facsimile, all of which together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
first set forth above.
TEXTWISE LLC ENTRANT
By: By:
Name Name
Title Social Security or Tax ID #
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Exhibit A
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