exv10w12






Exhibit 10.12




SUPPORT SERVICES AGREEMENT




     THIS SUPPORT SERVICES AGREEMENT (this “Agreement”) is made and entered into, as of February
15, 2008 (the “Effective Date”), by and between FALLBROOK TECHNOLOGIES INC., a Delaware corporation
(“Fallbrook”), having a place of business at 9444 Waples St., Suite 410, San Diego, California
92121 and VIRYD TECHNOLOGIES INC., a Delaware corporation (“Customer”), having a place of business
at 9444 Waples Street, Suite 410, San Diego, California 92121 (collectively the “Parties”).


1. Background. The Parties intend to enter into one or more licensing Agreements on in
order to commercialize Fallbrook’s NuVinciTM technology as it pertains. In order to help Customer
implement such technology, the Parties desire that Fallbrook perform certain professional services
as set forth in this Agreement.



2. Services. Fallbrook shall use its commercially reasonable efforts to perform
the services specified on Exhibit A to this Agreement (the “Services”) in a timely manner.



3. Compensation. Customer hereby agrees to pay invoices submitted Fallbrook as
provided on Exhibit A.



4. Independent Contractor Relationship. Fallbrook’s relationship with Customer is that of
an independent contractor, and nothing in this Agreement is intended to, or shall be construed to,
create a partnership, agency, joint venture, employment or similar relationship. Neither party is
authorized to make any representation, contract or commitment on behalf of the other party unless
specifically requested or authorized in writing to do so by the other party. No part of Fallbrook’s
compensation shall be subject to withholding by Customer for the payment of any social security,
federal, state or any other employee payroll taxes.



5. Ownership. All inventions, discoveries, enhancements, improvements, technology,
data or information (whether or not patentable) (“Improvements”) that relate to Fallbrook’s NuVinci
technology that are made or conceived by Fallbrook or Customer in connection with this Agreement
shall belong exclusively to Fallbrook, but shall be subject to any license grant set forth in any
license agreement between the Parties. Customer hereby sells, assigns and transfers to Fallbrook
all of Customer’s right, title and interest therein and thereto. All Improvements not related to
Fallbrook’s NuVinci technology that are made or conceived by Fallbrook or Customer in connection
with this Agreement shall belong exclusively to Customer. Fallbrook hereby sells, assigns and
transfers to Customer all of Fallbrook’s right, title and interest therein and thereto.



6. Confidentiality.



6.1 Confidential Information. During the term of this Agreement, and for a period of ten
(10) years following the expiration or earlier termination hereof, each party shall maintain in
confidence all information of the other party disclosed by the other party (the
“Discloser”) and is identified as, acknowledged to be, or can reasonably be inferred from the
subject matter of the disclosure to be, confidential (the “Confidential Information”), and shall
not use, disclose or grant the use of the Confidential Information except on a need-to-know basis
to those directors, officers, affiliates or employees, to the extent such disclosure is reasonably
necessary in connection with such party’s activities. To the extent that disclosure is authorized
by this Agreement, prior to disclosure, each party hereto shall obtain agreement of any such person
to hold in confidence and not make use of the Confidential Information for any purpose other than
those permitted by this Agreement or the OEM Agreement; provided, however, that the parties shall
maintain in strict confidence any Confidential Information of the Discloser that the Discloser
maintains as a trade secret.



6.2 Permitted Disclosures. The confidentiality obligations contained in Section 6.1 above
shall not apply to the extent that (a) any receiving party (the “Recipient”) is required to
disclose information by




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law, order or regulation of a governmental agency or a court of competent jurisdiction, provided
that the Recipient shall provide written notice thereof to the Discloser and sufficient opportunity
to object to any such disclosure or to request confidential treatment thereof; or (b) the Recipient
can demonstrate that (i) the disclosed information was public knowledge at the time of such
disclosure to the Recipient, or thereafter became public knowledge, other than as a result of
actions of the Recipient in violation hereof; (ii) the disclosed information was rightfully known
by the Recipient (as shown by its written records) prior to the date of disclosure to the Recipient
by the other party hereunder; (iii) the disclosed information was disclosed to the Recipient on an
unrestricted basis from a source unrelated to any party to this Agreement and not under a duty of
confidentiality to the Discloser; or (iv) the disclosed information was independently developed by
the Recipient without use of the Confidential Information disclosed by the Discloser.



6.3
Return of Confidential Information. Within ten (10) days after any request by a
Discloser, the Recipient shall destroy or deliver to the Discloser, at the Discloser’s option, all
materials in the Recipient’s possession or control that contain or disclose any Confidential
Information of the Discloser.



7. Disclaimer of Warranty. Limitation of Damages. Fallbrook shall provide the Services to
Customer in accordance with specifications provided by Customer as set forth on Exhibit A.
FALLBROOK SHALL HAVE NO LIABILITY UNDER THIS AGREEMENT ARISING FROM, RELATED TO, OR CONNECTED WITH
THE SALE AND/OR USE OF ANY PRODUCTS MADE BY CUSTOMER. FALLBROOK EXPRESSLY DISCLAIMS ALL WARRANTIES,
EXPRESS OR IMPLIED, REGARDING THE SERVICES AND RESULTING DELIVERABLES, INCLUDING BUT NOT LIMITED
TO, ANY WARRANTIES OF MERCHANTABILITY AND/OR FITNESS FOR ANY PARTICULAR PURPOSE. NEITHER PARTY
SHALL BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, SPECIAL, OR CONSEQUENTIAL DAMAGES, LOST
REVENUE, LOST PROFITS, OR LOST OPPORTUNITY ARISING FROM, RELATED TO, OR CONNECTED WITH THE SERVICES OR
RESULTING DELIVERABLES EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY THEREOF.



8. Term and Termination.



8.1 Term. The term of this Agreement shall commence on the Effective Date and shall,
unless earlier terminated as provided herein, continue until the earlier of (a) termination be
either party for cause, or (b) three (3) years.



8.2 Termination. Either party may terminate this Agreement immediately for a material
breach by the other party if the other party’s material breach of any provision of this Agreement
is not cured within thirty (30) days after the date of such party’s written notice of breach.



8.3 Effect of Expiration or Termination. The definitions contained in this Agreement and
the rights and obligations contained in this Section and Sections 5, 6, 7, 8.3 and 9 shall survive
any termination or expiration of this Agreement.



9. General Provisions.



9.1 Notices. Any notice required or permitted by this Agreement shall be in writing and
shall be delivered as follows, with notice deemed given as indicated: (a) by personal delivery,
when actually delivered; (b) by overnight courier, upon written verification of receipt; (c) by
facsimile transmission, upon acknowledgment of receipt of electronic transmission; or (d) by
certified or registered mail, return receipt requested, upon verification of receipt. Notice shall
be sent to the addresses set forth above or to such other address as either party may provide in
writing.



9.2 Assignment. Except as otherwise expressly provided under this Agreement neither this
Agreement nor any right or obligation hereunder may be assigned or otherwise transferred (whether
voluntarily, by operation of law or otherwise), without the prior express written consent of the
other party;




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provided, however, that either party may, without such consent, assign this Agreement and its
rights and obligations hereunder in connection with the transfer or sale of all or substantially
all of its business, or in the event of its merger, consolidation, change in control or other
similar transaction. Any permitted assignee shall assume all obligations of its assignor under this
Agreement. Any purported assignment or transfer in violation of this Section 9.2 shall be void.



9.3 Governing Law; Forum. This Agreement shall be governed in all respects
by the laws of the United States of America and by the laws of the State of California, as such
laws are applied to agreements entered into and to be performed entirely within California between
California residents. Each of the parties irrevocably consents to the exclusive personal
jurisdiction of the federal and state courts located in California, as applicable, for any matter
arising out of or relating to this Agreement, except that in actions seeking to enforce any order
or any judgment of such federal or state courts located in California, such personal jurisdiction
shall be nonexclusive.



9.4 Force Majeure. If either party fails to perform its obligations because of
strikes, lockouts, labor disputes, embargoes, acts of God, inability to obtain labor or materials,
governmental restrictions, governmental regulations, governmental controls, judicial orders, enemy
or hostile governmental action, terrorist act, civil commotion, riot, fire, earthquake, or natural
disaster, or other causes (except financial causes) beyond the reasonable control of the party
obligated to perform, then that party’s performance shall be excused for a period equal to the
period of such event.



9.5 Severability. If a court of law holds any provision of this Agreement to be
illegal, invalid or unenforceable, (a) that provision shall be deemed amended to achieve an
economic effect that is as near as possible to that provided by the original provision and (b) the
legality, validity and enforceability of the remaining provisions of this Agreement shall not be
affected thereby.



9.6 Waiver; Modification. If a party waives any term, provision or the other party’s
breach of this Agreement, such waiver shall not be effective unless it is in writing and signed by
such party. No waiver by a party of a breach of this Agreement shall constitute a waiver of any
other or subsequent breach by the other party. This Agreement may be modified only by mutual
written agreement of authorized representatives of the parties.



9.7 Entire Agreement. This Agreement constitutes the entire agreement between the
parties relating to this subject matter and supersedes all prior or contemporaneous agreements
concerning such subject matter, written or oral.



9.8 Counterparts. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same
instrument.



IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written
above.




	 	 	 	 	 	 	 
	FALLBROOK TECHNOLOGIES INC.	 	VIRYD TECHNOLOGIES INC.
	 
	 	 	 	 	 	 
	By:

	 	/s/ William Klehm
	 	By:
	 	/s/ Nicole Nicks
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Name:

	 	William Klehm
	 	Name:
	 	Nicole Nicks
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Title:

	 	CEO
	 	Title:
	 	CFO
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Date:

	 	2/15/08
	 	Date:
	 	2/15/08
	 

	 	 
	 	 	 	 





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EXHIBIT A




SERVICES AND SPECIFICATIONS




Description of Services:




Fallbrook shall perform various services selected from the following list on an as
requested and agreed upon basis:



	 
	 	•	 	Engineering services and project management, product development services and
manufacturing consulting consisting of 80% of Don Miller’s time and Michael Ross’ time and
100% of Martin Price’s time.
	 
	 	•	 	Patenting advice, patent prosecution and portfolio management, intellectual asset
management, trademark advice and services, other intellectual property management
services.
	 
	 	•	 	Business development, market analysis and marketing services.
	 
	 	•	 	Advice and services on accounting and financial matters, marketing, government and
public relations, industrial relations, personnel administration, procurement,
purchasing, inventory control, planning and investigation, management information
systems, legal, tax and administrative matters, and insurance including, without
limitation, maintenance of books and records, bank accounts and preparation of budgets,
forecasts and financial statements.
	 
	 	•	 	Treasury services, including cashier, payment, payroll, audit, director, stockholder
and committee records and sales records.
	 
	 	•	 	Advice and services regarding the investment of all corporate surplus cash,
including, but not limited to, all cash in corporate accounts not immediately required for
debt repayment, working capital, capital investment or other outstanding near term
financial obligations.
	 
	 	•	 	Recordkeeping services, including accounting, tax records, audit, director,
stockholder and committee records and sales records.
	 
	 	•	 	Services on selection, recruiting, supervision and evaluation of personnel.
	 
	 	•	 	Handling of regulatory, general legal and tax matters before federal, state and
municipal authorities.
	 
	 	•	 	Any other services as agreed to by the Parties.




Fallbrook shall perform the Services in a professional manner using commercially reasonable
efforts to perform the Services in a reasonably timely manner.




Description of Payment Terms:



Customer agrees to pay invoices submitted by Fallbrook in return for Services provided
under the following terms.





	 	1.	 	Customer shall pay Fallbrook a monthly fee in the amount of $28,500 for the
engineering and administration services described above and agreed to by the Parties. The
Parties contemplate that the services provided will be in the range of two full time
engineering and design personnel, 5 hours per week of legal and accounting
services, 2 hours per week each of human resources, 5 hours per week of general
ministerial services and no more that 1 hour a week each of Product Development
assistance, Business Development assistance and specialty engineering assistance from
Fallbrook’s Austin Engineering staff.
	 
	 	2.	 	Additionally, Customer shall reimburse Fallbrook’s direct cost incurred in the
hiring and continued employment of Martin Price.





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	 	3.	 	Upon request from Customer, Fallbrook may provide additional services for Customer.
For the additional services charges shall accrue on an hourly basis according to the
following hourly rates:






	 	a.	 	CFO — $150.00/hr
	 
	 	b.	 	VP, Business Development — $150.00/hr
	 
	 	c.	 	VP, Intellectual Property — $150.00/hr
	 
	 	d.	 	VP, Product Development — $150.00/hr
	 
	 	e.	 	Human Resources Manager — $100.00/hr
	 
	 	f.	 	Expert CVP Engineering — $100.00/hr
	 
	 	g.	 	Others — Agreed upon rate






	 	4.	 	Costs for Services Fallbrook incurs for materials, use of outside service
providers or otherwise shall be passed through to Customer and reimbursed.
	 
	 	5.	 	Invoices submitted hereunder are due upon receipt and are considered past due thirty
(30) days past the invoice date. Past due invoices are subject to an interest penalty of
1.5% per annum compounded monthly.





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