SETTLEMENT AND LICENSE AGREEMENT

           This Settlement and License Agreement (the “Agreement”) is entered
into by LML Patent Corp., a Delaware corporation having its principal place of
business in Marshall, Texas   (“LML”), on the one hand, and The Northern Trust
Company, an Illinois State Bank, and Northern Trust Corporation, a Delaware
Corporation, both having a principal place of business at 50 S. LaSalle Street,
Chicago, Illinois 60603 (collectively “Northern Trust”), on the other hand.  LML
and Northern Trust are individually referred to as “Party” and collectively as
the “Parties.”  This Agreement is effective as of June 30, 2011 (“Effective
Date”).

RECITALS

           WHEREAS, LML owns all right, title and interest in U.S. Patent No.
RE40,220 entitled “Check Writing Point of Sale System” (“the ‘220 Patent”);

           WHEREAS, LML filed an action against Northern Trust and other
defendants in the United States District Court for the Eastern District of
Texas, Marshall Division, 2-08-CV-448-DF (“Litigation I”), and LML also began a
separate action against other defendants in the United States District Court for
the Eastern District of Texas, Marshall Division, 2-09-CV-180-TJW (“Litigation
II”) (collectively, the “Lawsuits”).  In both Litigations I and II, LML alleges
infringement of LML’s ‘220 Patent;
 
    WHEREAS, LML’s published standard royalty rate for use of the LML Patents is
$0.01 U.S. dollars for each ARC SEC coded ACH transaction and $0.03 U.S. dollars
for each POP, BOC, WEB, or TEL SEC coded ACH transaction;
 
    WHEREAS, Northern Trust is a named defendant in Litigation I and Northern
Trust has denied liability;
 
    WHEREAS, the Parties have agreed to enter into this Agreement to avoid the
costs and risks of further litigation;
 
    WHEREAS, the Parties wish to settle their disputes, and Northern Trust
desires to obtain certain rights under the LML Patents (as hereinafter defined),
and LML is willing to grant such rights;
 
    NOW, THEREFORE, in consideration of the above premises and mutual covenants
contained in this Agreement and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Parties agree as
follows:

1.  
DEFINITIONS.  The following definitions apply to this Agreement:

(a)  
“ACH” is the acronym for the “Automated Clearing House” Network and means the
funds transfer system governed by the National Automated Clearing House
Association (“NACHA”).

 
 
 
 
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(b)  
“ACH Transaction” means an entry complying with the NACHA ACH Record Format
Specifications, for NACHA standard entry class codes ARC, WEB, POP, TEL, and
BOC.

(c)  
“Acquires” means to obtain an interest in an entity either by acquisition,
purchase, or merger.

(d)  
“Affiliate” of a Party means any Entity that directly or indirectly owns or
controls, is owned or controlled by, or is under common ownership or control
with, such party, where “control” means: (i) for an Entity incorporated in the
U.S. or whose country of domicile is the U.S., ownership of fifty percent (50%)
or more of the capital stock or other ownership interest of the Entity carrying
the right to vote for or appoint directors or their equivalent (if not a
corporation), or otherwise to direct or cause the direction of the management
policies of the Entity; or (ii) for an Entity incorporated outside of the U.S.
or whose country of domicile is outside of the U.S., ownership of less than
fifty percent (50%) of the capital stock or other ownership interest of the
Entity carrying the right to vote for or appoint directors or their equivalent
(if not a corporation), or otherwise to direct or cause the direction of the
management policies of the Entity, if the country of incorporation or the
country of domicile of the Entity requires that foreign ownership be less than
fifty percent (50%), but only to the extent that the maximum allowable amount of
securities instruments or other ownership interests of the Entity is owned by
the Party; and (iii) provided, however, that an Entity shall be considered an
Affiliate of a Party only for the periods where such ownership or control
exists.

(e)  
“Bank” means any institution that is a member of the Federal Reserve System and
that accepts demand deposits to consumer accounts from which a consumer may
withdraw funds by check or share draft for payment to others.

(f)  
“Court” means the United States District Court for the Eastern District of
Texas, Marshall Division.

(g)  
“Covered Products and Services” means any and all Licensed Products and Services
(and any of its/their components) that have been, will be, or are being
Exploited by or for Northern Trust (including properly licensed successors
(subject to Section 6 (Change in Control / Acquisitions)) and permitted assigns
(subject to Section 9.1 (Assignment)) or their Affiliates and only to the extent
such Exploitation is done by or for Northern Trust (including properly licensed
successors (subject to Section 6 (Change in Control / Acquisitions)) and
permitted assigns (subject to Section 9.1 (Assignment)) or their Affiliates and
not done on behalf of an Excluded Party.

(h)  
“Covered Third Parties” means any Entity other than an Excluded Party, to the
extent that such Entity Exploits any Covered Products and Services.

 
 
 
 
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(i)  
“Excluded Party” means any Bank.  Notwithstanding the foregoing, Excluded Party
does not include, and shall not be interpreted to include: (a) any Northern
Trust Entity; or (b) any Entity that:  (i) is dismissed with prejudice from a
lawsuit alleging Infringement of an LML Patent; (ii) is found not to Infringe
all asserted claims of an LML Patent(s) that are also not found to be invalid or
unenforceable after all appeals are exhausted; (iii) otherwise enters into a
settlement agreement with any LML Entity concerning an LML Patent(s); or (iv) is
otherwise licensed to an LML Patent(s).

(j)  
“Entity” means any individual, trust, corporation, person or company,
partnership, joint venture, limited liability company, association, firm,
unincorporated organization or other legal or governmental entity.

(k)  
“Exploit” means to own, design, develop, test, acquire, make, have made, use,
sell, offer to sell, perform, provide, import, export, and/or the exercise of
all other activities specified under 35 U.S.C. § 271 and foreign counterparts
thereto (as the foregoing 35 U.S.C. § 271 and foreign counterparts thereof may
be amended or superseded from time to time).  “Exploited,” “Exploitation,” and
other variations of the word “Exploit” shall have correlative meanings.

(l)  
“Infringement” or “Infringes” means direct infringement, indirect infringement,
including inducement to infringe and contributory infringement, infringement
under the doctrine of equivalents, or any other theory of infringement in any
jurisdiction worldwide.

(m)  
“Licensed Products and Services” means any and all products and services the
Exploitation of which, but for the license granted in this Agreement, would
Infringe any claim of any LML Patent.

(n)  
“Non-Covered Affiliate” with respect to an Entity means any affiliate of that
Entity that is not covered by a license, release, or covenant-not-to-sue under
the LML Patents.

(o)  
“Northern Trust Entities” means Northern Trust and its Affiliates and their
direct and indirect parents, subsidiaries, predecessors, properly licensed
successors (subject to Section 6 (Change in Control / Acquisitions)) and
permitted assigns (subject to Section 9.1 (Assignment)).

(p)  
“LML Entities” means LML and its Affiliates and its or their predecessors,
successors and permitted assigns (subject to Section 9.1 (Assignment)).

 
 
 
 
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(q)  
“LML Patents” means (i) U.S. Patent No. RE40,220, (ii) any issued patent and any
pending patent application anywhere in the world that LML currently owns or
controls (or has the right to own or, control,) as of the Effective Date of this
Agreement; (iii) any patent or patent application worldwide to which any of the
foregoing patents and/or patent applications claims priority or are otherwise
related, including, but not limited to all parents, provisionals, substitutes,
renewals, continuations, continuations-in-part, reissues, reexamination
certificates, divisionals, foreign counterparts, oppositions, continued
examinations, reexaminations, and extensions of any of the foregoing; and (iv)
applications of the foregoing patents and/or patent applications described
above.  For purposes of this definition, a patent or patent application is
deemed to be under LML’s “control” if LML has the right to assert a claim of
Infringement or grant a license under such patent or patent application.  LML
warrants and represents that, as the Effective Date, the LML Patents include the
LML Patents listed in the attached Schedule A.

2.  
SETTLEMENT OF THE LITIGATION

2.1.  
Stipulated Dismissal.  The Parties agree to direct their counsel to file with
the Court a joint motion for dismissal with prejudice of the Parties’ respective
claims for relief against the other Party in Litigation I as set forth in
Exhibit A within five (5) days after the receipt of payment specified in Section
3.1.  The Parties shall promptly proceed with any and all additional procedures
needed to dismiss with prejudice their respective claims for relief against the
other in Litigation I.

2.2.  
No Award of Fees or Costs.  The Parties agree that they shall bear their own
expenses, costs and attorneys’ fees relating to Litigation I and negotiating
this Agreement, including the transactions contemplated herein.

2.3.  
No Attempt to Invalidate.  Northern Trust agrees that, in the absence of a
subpoena or court order requiring its participation or support, no Northern
Trust Entity shall participate in or support any suit, claim, action,
litigation, administrative proceeding, or proceeding of any nature brought
against LML that challenges the validity or enforceability of the LML Patents so
long as  Northern Trust Entities: (a) have a license to the LML Patents, subject
to Section 6 (Change in Control / Acquisitions); (b) are fully released for all
claims of Infringement of the LML Patents, subject to Section 6 (Change in
Control / Acquisitions); or (c) are not accused of Infringement of any LML
Patent, subject to Section 6 (Change in Control / Acquisitions).  However, any
Northern Trust Entity may challenge the validity and/or enforceability of the
LML Patents if: (i) any suit, claim, action, litigation or proceeding to enforce
one or more of the LML Patents is brought against any Northern Trust Entity
related to one or more of the LML Patents, or places any Northern Trust Entity
in a reasonable apprehension of being sued on one or more of the LML Patents, or
(ii) any Northern Trust Entity receives a request for indemnification related to
an LML Patent, but only after the Northern Trust Entity has provided thirty (30)
days written notice to LML of its intent to challenge the validity or
enforceability of the asserted LML Patent(s).

 
 
 
 
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3.  
PAYMENT, TERM AND TERMINATION

3.1.  
Payment by Northern Trust.  Northern Trust agrees to pay, or will cause to be
paid on its behalf, a non-refundable lump sum of One Million Two Hundred Fifty
Thousand U.S. dollars ($1,250,000.00) within five (5) business days following
the Effective Date in consideration of the rights, licenses and terms granted to
Northern Trust and Northern Trust Entities as set forth in this Agreement and
the dismissal of Northern Trust with prejudice in Litigation I.  In the event
Northern Trust causes such amount to be paid on its behalf, the paying third
party shall not receive any rights, licenses, releases, covenants, or other
benefits or obligations under this Agreement solely by virtue of its having made
the payment on Northern Trust’s behalf, provided nothing herein shall be
construed to affect any rights of Covered Third Parties otherwise granted in
this Agreement.  Such amount will be delivered to LML’s counsel, McKool Smith
P.C., via wire transfer to the following account:

 
Address:
Citibank, N.A.

666 5th Avenue
 
New York, NY 10103

 
SWIFT Code:

 
ABA Routing:

 
A/C Name:
McKool Smith PC IOLTA Trust Account

 
A/C Number:

Nothing in this paragraph 3.1, however, shall diminish Northern Trust’s right to
seek damages independently for an alleged breach of this Agreement.

3.2.  
Term.  Unless earlier terminated as specified in this section, the term of this
Agreement shall commence upon the Effective Date and shall continue until the
later of the expiration of the last-to-expire patent included in the LML Patents
or the expiration of all causes of action and claims arising out of or related
to the LML Patents.  Otherwise, this Agreement may only be earlier terminated in
whole or in part pursuant to Section 3.3 (Termination Due to Non-Payment by
Northern Trust) or upon the mutual written agreement of the Parties.

3.3.  
Termination Due to Non-Payment by Northern Trust.  If Northern Trust fails to
make the payment as specified in Section 3.1 to LML (Payment by Northern Trust)
above in the time specified, such failure will constitute a material breach of
this Agreement.  Upon such breach, LML may then, after ten (10) business days
following written notice of such breach to Northern Trust, if Northern Trust
does not deliver the payment specified in Section 3.1 (Payment by Northern
Trust) to LML within ten (10) business days after receiving such notice from
LML, at its option, either terminate the Agreement or it may petition the Court
for specific enforcement of Northern Trust’s payment obligations.  Northern
Trust hereby consents to the jurisdiction of the Court for enforcement of the
payment obligations in Section 3.1 (Payment by Northern Trust), and agrees that
specific enforcement of the payment obligations of this Agreement is an
available remedy.

3.4.  
Tax Liability.  Each Party shall bear its own tax liability as a result of the
existence of this Agreement or the performance of any obligations hereunder.

 
 
 
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3.5.  
Additional Payments.  Subject to the provisions of Section 6 (Change in
Control/Acquisitions), the payment of the amount set forth in Section 3.1
(Payment by Northern Trust) shall be the total compensation to any LML Entity by
any Northern Trust Entity for all releases, licenses, covenants and all other
rights granted in this Agreement, and no additional payment shall be due or made
to any LML Entity or any other Entity by any Northern Trust Entity with respect
to the releases, licenses, covenants and all other rights granted in this
Agreement.

3.6  
Northern Trust’s Retained Rights / Bankruptcy.  The Parties acknowledge and
agree that the LML Patents are “intellectual property” as defined in Section
101(35A) of the United States Bankruptcy Code, as the same may be amended from
time to time (the "Code"), which have been licensed hereunder in a
contemporaneous exchange for value.  The Parties further acknowledge and agree
that if LML: (i) becomes insolvent or generally fails to pay, or admits in
writing its inability to pay, its debts as they become due; (ii) applies for or
consents to the appointment of a trustee, receiver or other custodian for it, or
makes a general assignment for the benefit of its creditors; (iii) commences, or
has commenced against it, any bankruptcy, reorganization, debt arrangement, or
other case or proceeding under any bankruptcy or insolvency law, or any
dissolution or liquidation proceedings; or (iv) elects to reject, or a trustee
on behalf of it elects to reject, this Agreement or any agreement supplementary
hereto, pursuant to Section 365 of the Code (“365”), or if this Agreement or any
agreement supplementary hereto is deemed to be rejected pursuant to 365 for any
reason, this Agreement, and any agreement supplementary hereto, shall be
governed by Section 365(n) of the Code (“365(n)”) and Northern Trust Entities
will retain and may elect to fully exercise its or their rights under this
Agreement in accordance with 365(n).

4.  
RELEASES AND COVENANTS NOT TO SUE

4.1.  
Agreement Obligations Not Released.  None of the releases or covenants not to
sue herein releases any Party or its Affiliates from its respective obligations
under this Agreement or under any protective orders entered in Litigation I as
of the Effective Date or prevents any Party or any of its Affiliates from
enforcing the terms and conditions of this Agreement against the other Party or
its Affiliates.

4.2.  
LML’s Release to Northern Trust.  Subject to the provisions of Section 3.3
(Termination Due to Non-Payment by Northern Trust) and Section 6 (Change in
Control/Acquisitions), LML Entities forever release (a) the Northern Trust
Entities from any and all claims, causes of action, actions, demands,
liabilities, losses, damages, attorneys’ fees, court costs, or any other form of
claim or compensation, whether known or unknown, whether in law or equity,
accruing before or on the Effective Date, related in whole or part to Litigation
I, any of the LML Patents, or Exploitation of the Covered Products and Services,
including without limitation any act of past or present Infringement,
misappropriation or other violation of one or more of the LML Patents, and any
claim that is or would have been within the scope of either the covenant not to
sue or license granted in Sections 4.4 (Covenant-Not-To-Sue by LML Entities) and
5.1 (License), and any claim that the LML Entities asserted or could have
asserted in Litigation I as of the Effective Date; and (b) the Covered Third
Parties from any and all claims, causes of action, actions, demands,
liabilities, losses, damages, attorneys’ fees, court costs, or any other form of
claim or compensation, whether known or unknown, whether in law or equity,
accruing before or on the Effective Date, related in whole or part to Litigation
I, any of the LML Patents, or Exploitation of the Covered Products and Services,
including without limitation any act of past or present Infringement,
misappropriation or other violation of one or more of the LML Patents, and any
claim that is or would have been within the scope of either the covenant not to
sue or license granted in Sections 4.4 (Covenant-Not-To-Sue by LML Entities) and
5.1 (License), and any claim that the LML Entities asserted or could have
asserted in Litigation I as of the Effective Date.

 
 
 
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4.3.  
Northern Trust’s Release to LML.  Subject to the obligations of LML under this
Agreement, Northern Trust Entities forever release LML Entities from any claims,
causes of action, actions, demands, liabilities, losses, damages, attorneys’
fees, court costs, or any other form of claim or compensation, whether known or
unknown, whether in law or equity, accruing before or on the Effective Date,
related in whole or part to Litigation I or any of the LML Patents (conserving,
subject to Section 2.3, defenses or claims regarding the validity or
enforceability of one or more of the LML Patents) that is or would have been
within the scope of the covenant not to sue granted in Section 4.5
(Covenant-Not-To-Sue by Northern Trust Entities) and that the Northern Trust
Entities asserted or could have asserted as of the Effective Date.

4.4.  
Covenant-Not-To-Sue by LML Entities.  Subject to the provisions of Section 3.3
(Termination Due to Non-Payment by Northern Trust) and Section 6 (Change in
Control/Acquisitions), the LML Entities, on behalf of themselves and their
respective successors and permitted assigns, agree that:  (a) they will not
assert, pursue, maintain, encourage, support, assist, or join in any action or
litigation asserting any claim against any Northern Trust Entity for
Infringement of any claim of the LML Patents with respect to or arising out of
the Exploitation of any Covered Products or Services or any patents which LML
has the right to assert against Northern Trust as of the Effective Date; and (b)
they will not assert, pursue, maintain, encourage, support, assist, or join in
any action or litigation asserting any claim against any Covered Third Parties
for Infringement of any claim of the LML Patents with respect to or arising out
of the Exploitation of any Covered Products and Services or any patents which
LML has the right to assert against Northern Trust as of the Effective Date.

 
4.5.  
Covenant-Not-To-Sue by Northern Trust Entities.  Subject to the obligations of
LML under this Agreement, the Northern Trust Entities, on behalf of themselves
and their respective successors and permitted assigns, agree that they will not
assert, pursue, maintain, encourage, support, assist, or join in any action or
litigation asserting any claim against any LML Entity in the future for any
claims related to or arising out of the LML Patents, unless any claims of
Infringement with respect to the LML Patents are asserted against any Northern
Trust Entity or its successors or assigns or any Covered Third Party.

 
 
 
 
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5.  
GRANT OF LICENSE

5.1.  
License.  Subject to the provisions of Section 3.3 (Termination Due to
Non-Payment by Northern Trust) and Section 6 (Change in Control / Acquisitions),
LML hereby grants to the Northern Trust Entities and Covered Third Parties a
fully paid-up, irrevocable, non-exclusive, worldwide, royalty-free license under
the LML Patents to Exploit the Covered Products and Services throughout the
world.  This license attaches to and is transferred with each Covered Product
and Service and passes to each and every Covered Third Party with regard to such
Covered Product and Service.  This license is retroactive to the earliest
priority date possible for any of the LML Patents.

5.2.  
Disclaimer of Infringement and Validity.  Nothing herein shall be construed as
an admission by any Northern Trust Entity: (a) that the LML Patents have been or
are being Infringed; or (b) that the LML Patents are valid or enforceable.

6.  
CHANGE IN CONTROL / ACQUISITIONS

6.1.  
Acquisitions by a Northern Trust Entity.  In the event any Northern Trust Entity
Acquires an Excluded Party or any business line of an Excluded Party after the
Effective Date of this Agreement (hereinafter referred to as “Acquired Entity”),
neither the Acquired Entity nor any of its Non-Covered Affiliates will gain the
benefit of the license grant, covenant-not-to-sue, or releases in this
Agreement.  Upon the Northern Trust Entity’s request, LML agrees to negotiate in
good faith with the Acquired Entity to release and/or license, under the LML
Patents, any ACH Transactions created, processed, or transmitted by the Acquired
Entity and/or any of its Non-Covered Affiliates (hereinafter “Section 6.1
Non-Covered ACH Transactions”).  If LML and the Acquired Entity cannot reach
agreement on the terms of such release and/or license, then LML, the Acquired
Entity (including the Northern Trust Entities), and any Non-Covered Affiliates
of the Acquired Entity shall have all remedies, defenses, and counterclaims
available to them under applicable law with respect to any Section 6.1
Non-Covered ACH Transactions.

6.2.  
Acquisitions of a Northern Trust Entity.  In the event an Excluded Party
Acquires any Northern Trust Entity and maintains the Northern Trust Entity as a
separate legal entity after the acquisition (the resulting legal entity
hereinafter referred to as the “Acquiring Entity”), then the license grant,
covenant not to sue, and releases in this Agreement may be assigned by the
Northern Trust Entity to the Acquiring Entity, and, under such circumstances,
will continue to apply with respect to any Exploitation of the Covered Products
and Services that occurred prior to the date of the acquisition and was covered
under the license grant, covenant not to sue, and releases in this
Agreement.  However, the license grant, covenant not to sue, and releases in
this Agreement will not apply to any Exploitation of the Covered Products and
Services created, processed or transmitted by the Acquiring Entity (including
the Northern Trust Entities), and/or by any Non-Covered Affiliates of the
Acquiring Entity each month after the date of the acquisition that go beyond
125% of the Northern Trust Entities’ average monthly transaction volumes for
Covered Products and Services based on the 12 months preceding the date of the
acquisition (hereinafter, “Acquisition Volume Limit”).  If the collective number
of Covered Products and Services created, processed or transmitted by the
Acquiring Entity (including the Northern Trust Entity) and/or by any Non-Covered
Affiliates of the Acquiring Entity in any given month after the date of the
acquisition exceeds the Acquisition Volume Limit, the Acquiring Entity agrees to
notify LML of same within sixty (60) days of such occurrence, and the Covered
Products and Services exceeding the Acquisition Volume Limit shall not be
covered under the license grant, covenant not to sue or releases in this
Agreement (hereinafter, “Section 6.2 Non-Covered ACH Transactions”).  If the
Acquiring Entity provides the notice as specified above within the timeframe
specified above, LML agrees to negotiate in good faith with the Acquiring Entity
to release and/or license, under the LML Patents, any Section 6.2 Non-Covered
ACH Transactions.  If the Acquiring Entity does not provide the notice as
specified above and/or if LML and the Acquiring Entity cannot reach agreement on
the terms of such release and/or license, then LML, the Acquiring Entity
(including the Northern Trust Entities), and any Non-Covered Affiliates of the
Acquiring Entity shall have all remedies, defenses, and counterclaims available
to them under applicable law with respect to any Section 6.2 Non-Covered ACH
Transactions.

 
 
 
 
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6.3.  
Transfer of Covered Assets of a Northern Trust Entity.  In the event of a sale
or other transfer of the assets of any Northern Trust Entity that includes a
business line that provides Covered Products and Services to an Excluded Party
(hereinafter referred to as the “Covered Transferee Entity”), then the license
grant, covenant not to sue, and releases in this Agreement may be assigned by
the Northern Trust Entity to the Covered Transferee Entity, and, under such
circumstances, shall continue to apply with respect to any Exploitation of the
Covered Products and Services that occurred prior to the date of the sale or
transfer and was covered under the license grant, covenant not to sue, and
releases in this Agreement.  However, the license grant, covenant not to sue,
and releases in this Agreement will not apply to those Covered Products and
Services created, processed or transmitted by the Covered Transferee Entity
(including the Northern Trust Entities) and/or any Non-Covered Affiliates of the
Covered Transferee Entity each month after the date of the purchase that go
beyond 125% of the Northern Trust Entities’ average monthly transaction volumes
for Covered Products and Services based on the 12 months preceding the date of
the purchase (hereinafter, “Covered Transferee Volume Limit”).  If the
collective number of Covered Products and Services created, processed or
transmitted by the Covered Transferee Entity (including the Northern Trust
Entity) and/or by any Non-Covered Affiliates of the Covered Transferee Entity in
any given month after the date of the purchase exceeds the Covered Transferee
Volume Limit, the Covered Transferee Entity agrees to notify LML of same within
sixty (60) days of such occurrence, and the Covered Products and Services
exceeding the Covered Transferee Volume Limit shall not be covered under the
license grant, covenant not to sue or releases in this Agreement (hereinafter,
“Section 6.3 Non-Covered ACH Transactions”).  If the Covered Transferee Entity
provides the notice as specified above within the timeframe specified above, LML
agrees to negotiate in good faith with the Covered Transferee Entity to release
and/or license, under the LML Patents, any Section 6.3 Non-Covered ACH
Transactions.  If the Covered Transferee Entity does not provide the notice as
specified above and/or if LML and the Covered Transferee Entity cannot reach
agreement on the terms of such release and/or license, then LML, the Covered
Transferee Entity (including the Northern Trust Entities), and any Non-Covered
Affiliates of the Covered Transferee Entity shall have all remedies, defenses,
and counterclaims available to them under applicable law with respect to any
Section 6.3 Non-Covered ACH Transactions.

 
 
 
 
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6.4.  
Transfer of Non-Covered Assets of a Northern Trust Entity. In the event of a
sale or other transfer of the assets of any Northern Trust Entity that does not
include any part of a business line that provides the Covered Products and
Services to an Excluded Party (hereinafter referred to as the “Non-Covered
Transferee Entity”), then neither the Non-Covered Transferee Entity nor any of
its Non-Covered Affiliates will gain the benefit of the license grant,
covenant-not-to-sue, or releases in this Agreement.  Upon the Non-Covered
Transferee Entity’s request, LML agrees to negotiate in good faith with the
Non-Covered Transferee Entity to release and/or license, under the LML Patents,
any ACH Transactions created, processed, or transmitted by the Non-Covered
Transferee Entity and/or any of its Non-Covered Affiliates (hereinafter “Section
6.4 Non-Covered ACH Transactions”).  If LML and the Non-Covered Transferee
Entity cannot reach agreement on the terms of such release and/or license, then
LML, the Non-Covered Transferee Entity, and any Non-Covered Affiliates of the
Non-Covered Transferee Entity shall have all remedies, defenses, and
counterclaims available to them under applicable law with respect to any Section
6.4 Non-Covered ACH Transactions.

6.5.  
Termination of Payments Due Pursuant to Section 6.  With respect to any good
faith negotiations undertaken pursuant to Sections 6.1 (Acquisitions by a
Northern Trust Entity) through Section 6.4 (Transfer of Non-Covered Assets By a
Northern Trust Entity) above, LML agrees that no royalty will be due as to an
LML Patent for any ACH Transactions created, processed, or transmitted by the
Northern Trust Entity, by any Acquired Entity, Acquiring Entity, Covered
Transferee Entity or Non-Covered Transferee Entity (as defined above), or by any
Non-Covered Affiliates of any Acquired Entity, Acquiring Entity, Covered
Transferee Entity or Non-Covered Transferee Entity after the expiration date of
such LML Patent or its final legal adjudication of invalidity or
unenforceability after all appeals are exhausted.

 
 
 
 
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7.  
CONFIDENTIALITY.  The Parties may disclose the existence of this
Agreement.  Neither the LML Entities or the Northern Trust Entities may disclose
the specific terms and conditions of this Agreement, including but not limited
to payment terms, to any Entity except that each Party may disclose the terms
and conditions of this Agreement: (i) in response to a valid subpoena or as
otherwise may be required by law, regulation, or order of a court or
governmental authority of competent jurisdiction, provided that the Party
required to make such a disclosure gives as much notice as is reasonably
possible to the other Party to contest such order or requirement and takes all
reasonable actions in an effort to minimize the nature and extent of such
disclosure; (ii) on a confidential basis to its legal, accounting or financial
advisors solely for the purposes of providing such advice and solely to the
extent that they have a need for access; (iii) if that Party forms a good faith
belief that disclosure is required under applicable securities regulations or
listing agency requirements, including for the purpose of disclosure in
connection with the Securities and Exchange Act of 1934, as amended, the
Securities Act of 1933, as amended, National Instrument NI 51-102 (under
Canadian law), as amended, and any other reports filed with the Securities and
Exchange Commission, or any other filings, reports or disclosures that may be
required under applicable laws or regulations, provided that any copy of this
Agreement that is provided under such laws or regulations is marked as
“Confidential”; (iv) in its financial statements as it is required to do under
applicable generally accepted accounting principles while acting in reliance on
its auditors; (v) to any defendant as part of its disclosure obligations subject
to the Court's Protective Order in the applicable litigation brought by LML to
enforce an LML Patent, in which event LML will seek to have the production
protected under an “Outside Counsel Attorneys Eyes Only” or higher
confidentiality designation and LML will take all reasonable actions in an
effort to minimize the nature and extent of such disclosure; (vi) upon the
express written consent of the other Party; (vii) on a confidential basis to
investors and potential investors and acquirers, but subject to any such
investor or potential investor or acquirer having first executed an appropriate
non-disclosure agreement requiring such investor or potential investor or
acquirer to maintain this Agreement and the terms and conditions of this
Agreement in confidence; or (viii) as necessary to pursue an indemnification
claim from a potential or actual indemnitor, subject to obligations of
confidentiality and privilege at least as stringent as those contained herein;
and (ix) to a Covered Third Party, subject to obligations of confidentiality and
privilege at least as stringent as those contained herein.

8.  
REPRESENTATIONS AND WARRANTIES

8.1.  
Northern Trust Representations and Warranties. Northern Trust represents and
warrants to LML that it has all requisite legal right, power and authority to
enter into, execute, deliver and perform this Agreement and grant the releases,
covenants not to sue and all other rights provided for under this Agreement.

 
 
 
 
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8.2.  
LML Representations and Warranties. As a condition precedent to Northern Trust
entering into this Agreement, LML represents and warrants to Northern Trust that
as of the Effective Date: (a) LML has all requisite legal right, power and
authority to enter into, execute, deliver and perform this Agreement and grant
the licenses, releases, covenants not to sue and all other rights provided for
under this Agreement; (b) LML owns the entire right, title, and interest in and
to the LML Patents and the inventions disclosed and claimed therein, including
all rights to enforce and recover for alleged Infringement of the LML Patents;
(c) the LML Entities have not granted and shall not grant any licenses or other
rights, under the LML Patents or the claims or counterclaims asserted in the
Litigation I or otherwise, that would conflict with or prevent the licenses and
rights granted to Northern Trust Entities or Covered Third Parties hereunder;
(d) there are no liens, conveyances, mortgages, assignments, encumbrances, or
other agreements that would prevent or impair the full and complete exercise of
the terms and conditions of this Agreement; (e) the LML Entities have not
entered into, and shall not enter into, any other agreement that would interfere
with the obligations and immunities set forth in this Agreement during the term
of this Agreement; and (f) LML will not transfer, assign, or exclusively license
to another any of the LML Patents or claims/demands that LML asserted (or could
have asserted) against the Northern Trust Entities relating to the LML Patents
or the Litigation I, unless the transferee, assignee, or exclusive licensee
agrees to be bound by all of the terms and conditions of this Agreement.

8.3.  
Limitations on Representations and Warranties.  Nothing contained in this
Agreement shall be construed as: (a) a warranty or representation by either
Party that any manufacture, sale, use, or other disposition of products by the
other Party has been or will be free from Infringement of any patents other than
the LML Patents; (b) an agreement by either Party to bring or prosecute actions
or suits against any Entity for Infringement, or conferring any right to the
other Party to bring or prosecute actions or suits against third parties for
Infringement; (c) conferring any right to either Party to use in advertising,
publicity, or otherwise, any trademark, service mark, or trade dress of the
other Party, or any simulation thereof, without the prior written consent of the
other Party; (d) conferring any right to either Party, except as otherwise
provided in Section 7 (Confidentiality), to use any names or trade names of the
other Party, or any simulation thereof, without the prior written consent of the
other Party; (e) an obligation to furnish any technical information or know-how;
or (f) conferring by implication, estoppel or otherwise, upon either Party, any
right (including a license) under patents other than the LML Patents except for
the rights expressly granted hereunder.

8.4.  
DISCLAIMER OF WARRANTIES.  EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN THIS
AGREEMENT, THE PARTIES MAKE NO EXPRESS REPRESENTATIONS AND GRANT NO WARRANTIES,
EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR
OTHERWISE.

8.5.  
No Joint and Several Liability.  Notwithstanding anything herein to the
contrary, the Northern Trust Entities and the Covered Third Parties shall not
have any liability to any of the LML Entities for any actions or inactions of
another defendant in the Lawsuits, or any other Entity against whom any of the
LML Entities has asserted or may assert a claim for Infringement of an LML
Patent.

 
 
 
 
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9.  
GENERAL PROVISIONS

9.1.  
Assignment.  Except as otherwise provided in Section 6, this Agreement may not
be assigned by either Party without the prior written consent of the other Party
in its sole discretion.  Absent such written consent from Northern Trust, LML
shall not assign, or grant any right to enforce any LML Patent, or any right
that would conflict with the rights granted hereunder, to any Entity unless such
assignment or grant is subject to all of the terms and conditions of this
Agreement, and such Entity executes an agreement agreeing to be bound by all of
the terms and conditions of this Agreement including a requirement to bind all
further successors-in-interest or assigns thereof to the terms and conditions of
this Agreement.  All releases, licenses, and covenants contained herein shall
run with the LML Patents and shall be binding on any successors-in-interest or
assigns thereof.  Any attempted assignment or grant in contravention to this
Section shall be null and void.  The Parties agree to abide by all of the terms
of this Section 9.1 (Assignment), even if a court or other tribunal later finds
that any portion of this section is contrary to law or equity.

9.2.  
Entire Agreement.  This Agreement, including all Exhibits attached hereto,
constitutes the entire agreement between the Parties and embodies the entire and
only understanding of each of them with respect to the subject matter of the
Agreement, and merges, cancels and supersedes all prior representations,
warranties, assurances, conditions, definitions, understandings and all other
statements or agreements, whether express, implied, or arising out of operation
of law, whether oral or written, whether by omission or commission, between and
among the Parties hereto with respect to the subject matter of the Agreement.
There are no representations, warranties, terms, conditions, undertakings or
collateral agreements, express, implied or statutory, between the Parties other
than as expressly set forth in this Agreement.

9.3.  
Notices.  All notices, requests, approvals, consents and other communications
required or permitted under this Agreement will be in writing and addressed as
follows:

           If to LML:
Mr. Patrick H. Gaines
President
LML Patent Corp
505 East Travis St.
Suite 216
Marshall, TX  75670

           with a copy to:

LML Patent Corp.
Corporate Secretary
1680- 1140 West Pender Street
Vancouver BC, Canada V6E 4G1
 
 
 
 
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If to Northern Trust:
Northern Trust Corporation
50 S. LaSalle Street
Chicago, IL 60603
Attention:  Executive Vice President and General Counsel

and

The Northern Trust Company
50 S. LaSalle Street
Chicago, IL 60603
Attention:  Executive Vice President and General Counsel

with a copy to:

Pamela L. Peters
Senior Attorney
Legal Department
The Northern Trust Company
50 S. LaSalle Street
Chicago, IL 60603

and will be deemed delivered: (a) upon receipt if delivered by hand; (b) the
next day if sent by prepaid, U.S. recognized, overnight air courier; (c) three
(3) business days after being sent by registered or certified mail (return
receipt requested, postage prepaid); or if by facsimile, the day that the sender
receives an acknowledgement that the facsimile was successfully
transmitted.  All notices shall be addressed to the other Party at the address
set forth above or to such other person or address as the Parties may from time
to time designate in writing delivered pursuant to this notice provision.

9.4.  
Governing Law.  This Agreement and all matters connected with the performance
thereof shall be governed by and will be construed, interpreted, and applied in
accordance with the laws of the State of Texas and the federal laws of the
United States as applicable therein, without regard to the laws of those
jurisdictions governing conflicts of laws.

9.5.  
Expenses.  Except as otherwise specifically provided in this Agreement, the
Parties agree that they shall bear their own costs and attorneys’ fees incurred
in connection with the negotiation and drafting of this Agreement and the
transactions contemplated herein.

9.6.  
Headings. The section and sub-section headings contained in this Agreement are
for convenience of reference only and shall not serve to limit, expand or
interpret the sections or sub-sections to which they apply, and shall not be
deemed to be a part of this Agreement.

 
 
 
 
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9.7.  
Interpretation; Construction. The Parties have participated jointly in the
negotiation and drafting of this Agreement.  In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if jointly drafted by the Parties and no presumption or burden of proof shall
arise favoring or disfavoring either Party by virtue of the authorship of any
provision of this Agreement.  This Agreement is in the English language only,
which language shall be controlling in all respects, and all notices under this
Agreement shall be in the English language.  For purposes of construction, the
singular includes the plural and vice versa.

 
9.8.  
Relationship of the Parties.  This Agreement does not constitute and shall not
be construed as constituting a partnership, agency, employer-employee, or joint
venture between LML and Northern Trust, and neither Party shall have any right
to incur any debt, make any commitment for each other, or obligate or bind the
other Party in any manner whatsoever, and nothing herein contained shall give or
is intended to give any rights of any kind to any third persons, except as
expressly provided herein.  LML and Northern Trust each expressly disclaim any
reliance on any act, word, or deed of the other in entering into this Agreement.

9.9.  
Binding Effect.  Subject to the provisions of Section 6 (Change in
Control/Acquisitions), this Agreement shall be binding upon, inure to the
benefit of, and be enforceable by the Parties, their predecessors, and
successors and permitted assigns.

9.10.  
Enforceability.  The Parties acknowledge and agree that this Agreement is
enforceable according to its terms.

9.11.  
Severability.  In the event that any term or provision of this Agreement is
deemed illegal, invalid, unenforceable or void by a final, non-appealable
judgment of a court or tribunal of competent jurisdiction under any applicable
statute or rule of law, such court or tribunal is authorized to modify such
provision to the minimum extent possible to effect the overall intention of the
Parties as of the Effective Date of this Agreement.  The Parties agree to
negotiate in good faith to try and substitute an enforceable provision for any
invalid or unenforceable provision that most nearly achieves the intent of such
provisions.

 
 
 
 
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9.12.  
Releases; Waiver of Section 1542 of the California Civil Code. To the extent
that the releases in Section 4.2 (LML’s Release of Northern Trust) and Section
4.3 (Northern Trust’s Release of LML) are releases to which Section 1542 of the
California Civil Code (or similar provisions of other applicable law) applies,
it is the intention of the Parties that the releases in Section 4.2 (LML’s
Release of Northern Trust) and Section 4.3 (Northern Trust’s Release of LML)
shall be effective as a bar to any and all actions, fees, damages, losses,
claims, liabilities and demands of whatsoever character, nature and kind, known
or unknown, suspected or unsuspected specified therein.  In furtherance of this
intention, the Parties expressly waive any and all rights and benefits conferred
upon them by the provisions of Section 1542 of the California Civil Code (or
similar provisions of applicable law), which provides that:  “A GENERAL RELEASE
DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST
IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST
HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.”

9.13.  
Counterparts. This Agreement may be executed in two or more counterparts or
duplicate originals, each of which shall be considered one and the same
instrument, and which shall be the official and governing version in
interpretation of this Agreement.  This Agreement may be executed by facsimile
signatures and such signatures shall be deemed to bind each Party as if they
were original signatures.

9.14.  
Waiver.  No waiver of any breach of any provision of this Agreement shall be
construed as a waiver of or consent to any previous or subsequent breach of the
same or any other provision.

9.15.  
Force Majeure.  The failure of a Party hereunder to perform any obligations, due
to governmental action, law or regulation, or due to events, such as war, act of
public enemy, strikes or other labor disputes, fire, flood, acts of God, or any
similar cause beyond the reasonable control of such Party, is excused for as
long as said cause continues to exist.  The Party prevented from performing
shall promptly notify the other Party of such non-performance and its expected
duration, and shall use all reasonable efforts to overcome the cause thereof as
soon as practicable.

9.16.  
Amendment. This Agreement may not be amended or modified, except by a writing
signed by all Parties.

9.17.  
Sophisticated Parties Represented by Counsel.  The Parties each acknowledge,
accept, warrant, and represent that: (i) they are sophisticated Entities
represented at all relevant times during the negotiation and execution of this
Agreement by counsel of their choice, and that they have executed this Agreement
with the consent and on the advice of such independent legal counsel; and (ii)
they and their counsel have determined through independent investigation and
arm’s-length negotiation that the terms of this Agreement shall exclusively
embody and govern the subject matter of this Agreement.

 
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized officers as of the Effective Date.

LML Patent Corp.
 
Northern Trust Corporation
     
By:/s/ Patrick H. Gaines
 
By:/s/ Peter A. Magrini
     
Name: Patrick H. Gaines
 
Name: Peter A. Magrini
     
Title: President
 
Title: Executive Vice President
     
Date: June 24, 2011
 
Date: June 23, 2011
               
The Northern Trust Company
         
By:  /s/ Maureen A. Mosh
         
Name: Maureen A. Mosh
         
Title: Assistant General Counsel
         
Date: June 30, 2011

 
 
 

 

 
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SCHEDULE A
LML PATENTS
 
 
 
Patent Number
Patent Application Number
 
Filing Date
Issue Date
Country
Title
RE40,220
10/889,639
07/12/04
04/08/08
US
“Check Writing Point of Sale System”
6,354,451
09/851,609
05/09/01
03/12/02
US
“Check Writing Point of Sale System”
6,283,366
09/562,303
05/01/00
09/04/01
US
“Check Writing Point of Sale System”
6,164,528
08/775,400
12/31/96
12/26/00
US
“Check Writing Point of Sale System”
5,484,988
08/257,390
06/09/94
01/16/96
US
“Checkwriting Point of Sale System”

 

 
 

 
 

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EXHIBIT A
 

JOINT STIPULATED MOTION FOR DISMISSAL WITH PREJUDICE

           Plaintiff LML Patent Corp. (“LML”) and Defendant The Northern Trust
Company (“Northern Trust”), pursuant to Fed. R. Civ. P. 41(a)(2) and (c), hereby
move for an order dismissing all of LML’s claims in this action against Northern
Trust WITH PREJUDICE and all of Northern Trust’s counterclaims in this action
against LML WITH PREJUDICE , with each party bearing its own attorneys’ fees,
costs and expenses.

ORDER OF DISMISSAL WITH PREJUDICE

           On this day the Court heard Plaintiff LML Patent Corp.’s (“LML”) and
Defendant The Northern Trust Company’s (“Northern Trust”) Stipulated Motion for
Dismissal With Prejudice (“Motion for Dismissal”).  After considering the Motion
for Dismissal and other matters of record, the Court is of the opinion that the
Motion for Dismissal is meritorious and should be GRANTED.  It is therefore
ORDERED that:

           Each and every claim and/or cause of action asserted by LML against
Northern Trust in the above-captioned lawsuit is hereby DISMISSED WITH
PREJUDICE, and each and every counterclaim and/or cause of action asserted by
Northern Trust against LML in the above-captioned lawsuit is hereby DISMISSED
WITH PREJUDICE.  Each party is to bear its own attorneys’ fees, costs and
expenses.

So ORDERED and SIGNED this           day of           ,2011.

DAVID FOLSOM
UNITED STATES DISTRICT JUDGE
DM_US 28853515-1.042044.0062

 

 
 

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