SETTLEMENT AND LICENSE AGREEMENT

           This Settlement and License Agreement (the “Agreement”) is entered
into by LML Patent Corp (“LML”), on the one hand, and M&I Marshall & Ilsley Bank
(“M&I”), on the other hand.  LML and M&I are individually referred to as “Party”
and collectively as the “Parties.”  This Agreement is effective as of November
10, 2010 (“Effective Date”).

RECITALS

WHEREAS, LML represents that it owns rights in U.S. Patent No. RE40,220 (“the
‘220 Patent”), which LML asserts is related to Electronic Check Conversion
systems and services;

WHEREAS, LML began an action against M&I 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 represents that its stated 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, M&I is a named defendant in Litigation I and M&I has denied liability;

WHEREAS, the Parties have agreed to enter into this Agreement to avoid the risk
and uncertainty of trial;

WHEREAS, the Parties wish to settle their dispute, and M&I 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”).

(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.

 
-1-

--------------------------------------------------------------------------------

 

(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 Infringing Products and
Services (and any of its/their components) that have been, will be, or are being
Exploited by or for M&I (including properly licensed successors (subject to
Section 6 (Change in Control / Acquisitions)) and permitted assigns (subject to
Section 9.1 (Assignment)) or its Affiliates and only to the extent such
Exploitation is done by or for M&I (including properly licensed successors
(subject to Section 6 (Change in Control / Acquisitions)) and permitted assigns
(subject to Section 9.1 (Assignment)) or its 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.

 
-2-

--------------------------------------------------------------------------------

 

(i)  
“Excluded Party” means any Bank.  Notwithstanding the foregoing, Excluded Party
does not include, and shall not be interpreted to include: (a) any M&I Entity;
or (b) any Entity that:  (i) is dismissed with prejudice from a lawsuit for
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, 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,
infringement under the doctrine of equivalents, or any other theory of
infringement in any jurisdiction worldwide.

(m)  
“Infringing 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)  
“M&I Entities” means M&I and its Affiliates and its or their 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)).

 
-3-

--------------------------------------------------------------------------------

 

(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.

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 the Parties’ respective claims for relief
against the other Party 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 the
Agreement, including the transactions contemplated herein.

2.3.  
No Attempt to Invalidate.  M&I agrees that, in the absence of a subpoena or
court order requiring its participation or support, no M&I Entity shall
participate in or support any suit, claim, action, litigation, administrative
proceeding, or proceeding of any nature brought by or against LML that
challenges the validity or enforceability of the LML Patents so long as the M&I
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, the M&I Entities may challenge the
validity 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 a M&I Entity related to one or more of the LML Patents, or places a M&I
Entity in a reasonable apprehension of being sued on one or more of the LML
Patents, or (ii) a M&I Entity receives a request for indemnification related to
an LML Patent, but only after the M&I Entity has provided sixty (60) days
written notice to LML Entities of its intent to challenge the validity or
enforceability of the asserted LML Patent(s).

 
-4-

--------------------------------------------------------------------------------

 

3.  
PAYMENT, TERM AND TERMINATION

3.1.  
Payment by M&I.  M&I agrees to pay to LML the non-refundable sum of Three
Hundred and Fifteen Thousand U.S. dollars ($315,000.00) within five (5) business
days following the Effective Date in consideration of the terms set forth in
this Agreement.  Such amount will be delivered to LML’s counsel, McKool Smith
P.C., via wire transfer to the following account:

Bank: Citibank, N.A.
Address: 666 5th Avenue
                New York, NY 10103
SWIFT Code:
Acct#
ABA#
Account Name:  McKool Smith PC IOLTA Trust Account

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
expiration of all causes of action and claims arising out of or related to the
LML Patents or the Lawsuits.  Otherwise, this Agreement may only be earlier
terminated in whole or in part pursuant to Section 3.3 (Termination Due to
Non-Payment by M&I) or upon the mutual written agreement of the Parties.

3.3.  
Termination Due to Non-Payment by M&I.  If M&I fails to make the payment
specified in Section 3.1 (Payment by M&I) above in the time specified, such
failure will constitute a material breach of this Agreement.  Upon such breach,
LML may then, after five (5) business days following written notice of such
breach to M&I, if M&I does not deliver the payment specified in Section 3.1
(Payment by M&I) to LML within five (5) 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 M&I’s payment obligations.  M&I
hereby consents to the jurisdiction of the Court for enforcement of the payment
obligations in Section 3.1 (Payment by M&I), 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.

 
-5-

--------------------------------------------------------------------------------

 

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 M&I) shall be the total compensation to any LML Entity by any M&I
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 M&I Entity with respect to the releases, licenses,
covenants and all other rights granted in this Agreement.

3.6  
M&I’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 M&I 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.

 
-6-

--------------------------------------------------------------------------------

 

4.2.  
LML’s Release to M&I.  Subject to the provisions of Section 3.3 (Termination Due
to Non-Payment by M&I) and Section 6 (Change in Control/Acquisitions), LML
Entities forever release (1) the M&I Entities and (2) 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.

4.3.  
M&I’s Release to LML.  Subject to the obligations of LML under this Agreement,
M&I 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 M&I Entities) and that
the M&I 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 M&I) 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 M&I 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; 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.

4.5.  
Covenant-Not-To-Sue by M&I Entities.  Subject to the obligations of LML under
this Agreement, the M&I 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 M&I Entity or its successors
or assigns or any Covered Third Party.

 
-7-

--------------------------------------------------------------------------------

 

5.  
GRANT OF LICENSE

5.1.  
License.  Subject to the provisions of Section 3.3 (Termination Due to
Non-Payment by M&I) and Section 6 (Change in Control / Acquisitions), LML hereby
grants to the M&I Entities a fully paid-up, irrevocable, non-exclusive,
world-wide, royalty free license under the LML Patents to Exploit the Covered
Products and Services throughout the world.  This license is retroactive to the
earliest priority date of the LML Patents.

5.2.  
Disclaimer of Infringement and Validity.  Nothing herein shall be construed as
an admission by any M&I 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 M&I Entity.  In the event any M&I Entity Acquires an Excluded
Party or any business line of an Excluded Party that provides Infringing
Products and Services 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 M&I 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 M&I 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.

 
-8-

--------------------------------------------------------------------------------

 

6.2.  
Acquisitions of a M&I Entity.  In the event an Excluded Party Acquires any M&I
Entity and maintains the M&I 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 M&I 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 those ACH Transactions
created, processed or transmitted by the Acquiring Entity (including the M&I
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 M&I 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 ACH Transactions created, processed
or transmitted by the Acquiring Entity (including the M&I 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
ACH Transactions 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
M&I 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.

 
-9-

--------------------------------------------------------------------------------

 

6.3.  
Transfer of Covered Assets of a M&I Entity.  In the event of a sale or other
transfer of the assets of any M&I 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 M&I
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 ACH Transactions created, processed or
transmitted by the Covered Transferee Entity (including the M&I 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 M&I 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 ACH Transactions created, processed or
transmitted by the Covered Transferee Entity (including the M&I 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 ACH Transactions 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
M&I 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.

 
-10-

--------------------------------------------------------------------------------

 

6.4.  
Transfer of Non-Covered Assets of a M&I Entity. In the event of a sale or other
transfer of the assets of any M&I 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 M&I
Entity) through Section 6.4 (Transfer of Non-Covered Assets By a M&I 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 M&I 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.

 
-11-

--------------------------------------------------------------------------------

 

7.  
CONFIDENTIALITY.  The Parties may disclose the existence of this
Agreement.  Neither Party may disclose the specific terms and conditions of this
Agreement 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; (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.  
M&I Representations and Warranties. M&I 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.

 
-12-

--------------------------------------------------------------------------------

 

8.2.  
LML Representations and Warranties. As a condition precedent to M&I entering
into this Agreement, LML represents and warrants to M&I 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 recover for
alleged Infringement of the LML Patents by the M&I Entities; (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 M&I 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 M&I 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 STATUE OR
OTHERWISE.

 
-13-

--------------------------------------------------------------------------------

 

8.5.  
No Joint and Several Liability.  Notwithstanding anything herein to the
contrary, the M&I 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 a LML Patent.

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 M&I, 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.

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

 
-14-

--------------------------------------------------------------------------------

 

           with a copy to:

LML Patent Corp.
Corporate Secretary
1680- 1140 West Pender Street
Vancouver BC, Canada V6E 4G1

           If to M&I:

M&I Marshall & Ilsley Bank
770 N. Water Street
Milwaukee, Wisconsin 53202
Attention:  Senior Vice President and General Counsel

With a copy thereof to each of the following (which shall not constitute notice
hereunder):

Mark Kitchin
Senior Litigation Counsel
Assistant Vice President
M&I Marshall & Ilsley Bank
6860 W. 115th, Suite 100
Overland Park,  KS  66211

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.

 
-15-

--------------------------------------------------------------------------------

 

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.

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 M&I, 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 M&I 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.

9.12.  
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.

 
-16-

--------------------------------------------------------------------------------

 

9.13.  
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.

9.14.  
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.

9.15.  
Amendment. This Agreement may not be amended or modified, except by a writing
signed by all Parties.

9.16.  
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.

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.
 
M&I Marshall & Ilsley Bank
     
By:/s/ Patrick H. Gaines
 
By:/s/ John Voss
     
Name: Patrick H. Gaines
 
Name: John Voss
     
Title: President
 
Title: SVP
     
Date: November 12, 2010
 
Date: November 10, 2010

 
 

 
-17-

--------------------------------------------------------------------------------

 

EXHIBIT A

STIPULATED DISMISSAL WITH PREJUDICE

and

ORDER OF DISMISSAL WITH PREJUDICE

(see attached)

 
 

--------------------------------------------------------------------------------

 

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
MARSHALL DIVISION

LML PATENT CORP,
§
   
§
 
PLAINTIFF
§
   
§
 
v.
§
CIVIL ACTION NO. 2:08-CV-448-DF
 
§
   
§
JURY
JP MORGAN CHASE & CO., ET AL.,
§
   
§
 
DEFENDANTS
§
 

STIPULATED DISMISSAL WITH PREJUDICE

Pursuant to Rule 41(a) of the Federal Rules of Civil Procedure and the terms of
a separate Settlement and License Agreement, the Plaintiff, LML Patent Corp and
Defendant M&I Marshall & Ilsley Bank , have agreed to settle, adjust, and
compromise all claims and counterclaims against each other in the
above-captioned action.  The parties, therefore, stipulate to dismiss all claims
by LML Patent Corp against M&I Marshall & Ilsley Bank and all counterclaims by
M&I Marshall & Ilsley Bank against LML Patent Corp made therein with prejudice
to the re-filing of same, subject to the terms of the Settlement and License
Agreement between the parties.

LML Patent Corp. and M&I Marshall & Ilsley Bank further stipulate that all costs
and expenses relating to this litigation (including, but not limited to,
attorneys’ fees and expert fees and expenses) shall be borne solely by the party
incurring the same.

A proposed Order accompanies this motion.

AGREED:

 
-1-

--------------------------------------------------------------------------------

 

Date: ______________, 2010
 
Respectfully submitted,
         
By: /s/           
   
Robert W. Schroeder III
   
SBN 24029190
   
tschroeder@texarkanalaw.com
   
PATTON, TIDWELL & SCHROEDER, L.L.P.
   
4605 Texas Boulevard
   
Post Office Box 5398
   
Texarkana, Texas 75505-5398
   
Telephone: 903-792-7080
   
Facsimile:  903-792-8233
         
Edward G. Poplawski
   
Admitted pro hac vice
   
epoplawski@sidley.com
   
Jeffrey A. Finn
   
Admitted pro hac vice
   
jfinn@sidley.com
   
Olivia M. Kim
   
Admitted pro hac vice
   
okim@sidley.com
   
Michael Lee
   
Admitted pro hac vice
   
Mlee06@sidley.com
   
SIDLEY AUSTIN LLP
   
555 West Fifth Street
   
Suite 4000
   
Los Angeles.  CA  90013
   
Telephone:  213-896-6000
   
Facsimile:  213-896-6600
               
ATTORNEYS FOR DEFENDANT
REGIONS BANK
         
and

 
-2-

--------------------------------------------------------------------------------

 

         
/s/ Melissa Smith
   
Melissa Smith
   
Texas State Bar No. 00794818
   
GILLAM & SMITH, LLP
   
303 South Washington
   
Marshall, Texas 75670
   
Telephone: 903-934-8450
   
Facsimile: 903-934-9257
   
Melissa@gillamsmithlaw.com
         
Theodore Stevenson, III
   
Lead Attorney
   
Texas Bar No. 19196650
   
tstevensom@mckoolsmith.com
   
John Austin Curry
   
Texas State Bar No. 24059636
   
acurry@mckoolsmith.com
   
McKool Smith, P.C.
   
300 Crescent Court, Suite 1500
   
Dallas, Texas 75201
   
Telephone: 214-978-4974
   
Facsimile: 214-978-4044
         
Sam F. Baxter
   
Texas Bar No. 01938000
   
sbaxter@mckoolsmith.com
   
McKOOL SMITH, P.C.
   
505 East Travis Street, Suite 105
   
Marshall, TX 75670
   
Telephone: 903-927-2111
   
Facsimile: 903-927-2622
         
Michael S. Perez
   
Texas Bar No. 24002752
   
mperez@mckoolsmith.com
   
Daniel W. Sharp
   
Texas Bar NO. 24041902
   
dsharp@mckoolsmith.com
   
John Garvish
   
Texas State Bar No. 24043681
   
jgarvish@mckoolsmith.com
   
McKool Smith, P.C.
   
300 W. 6th Street, Suite 1700
   
Austin, Texas  78701
   
Telephone: 512-692-8725
   
Facsimile: 512-692-8744
         
ATTORNEYS FOR PLAINTIFF LML PATENT CORP.

 
-3-

--------------------------------------------------------------------------------

 

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
MARSHALL DIVISION

LML PATENT CORP,
§
   
§
 
PLAINTIFF
§
   
§
 
v.
§
CIVIL ACTION NO. 2:08-CV-448-DF
 
§
   
§
JURY
JP MORGAN CHASE & CO., ET AL.,
§
   
§
 
DEFENDANTS
§
 

ORDER OF DISMISSAL WITH PREJUDICE

The Court is of the opinion that the Stipulated Dismissal with Prejudice agreed
to by LML Patent Corp and M&I Marshall & Ilsley Bank should be GRANTED.

IT IS THEREFORE ORDERED that the above-entitled cause and all claims made by LML
Patent Corp against M&I Marshall & Ilsley Bank and all counterclaims made by M&I
Marshall & Ilsley Bank against LML Patent Corp therein are hereby DISMISSED WITH
PREJUDICE to the re-filing of same, subject to the terms of the Settlement and
License Agreement between the parties.  All costs and expenses relating to this
litigation (including, but not limited to, attorneys’ fees and expert fees and
expenses) shall be borne solely by the party incurring the same.

IT IS FURTHER ORDERED that this Court shall retain jurisdiction over this action
and the parties for purposes of enforcing the terms of the Settlement and
License Agreement entered into by and between the parties.

This is a final judgment.

 

 
 

--------------------------------------------------------------------------------