Document:

Exhibit 10.1

 

	 	
      The
      Way Business 

      Gets
      Communicated SM

Exhibit
10.1

NON-EXCLUSIVE
RESELLER AGREEMENT

THIS
NON-EXCLUSIVE RESELLER AGREEMENT (this “Agreement”) is entered into and shall be
effective as of March 1, 2005, by and between Sequiam Software, Inc. with a
principal place of business at 300 Sunport Lane, Orlando, Florida 32809.
(“Company”) and IKON Office Solutions, Inc., with a principal place of business
at 70 Valley Stream Parkway, Malvern PA 19355 (“IKON”).

Background

Company
desires to grant to IKON the non-exclusive right to sell and distribute the
specific products described in Exhibit A (the
“Products”). IKON is engaged in the sale and distribution of copier, print and
other office products and desires to have the right to sell and distribute the
Products upon the terms and conditions set forth below.

NOW,
THEREFORE, in consideration of the mutual covenants and conditions contained
herein, the parties hereto (the “Parties”), intending to be legally bound,
hereby agree as follows:

	
      1.
	
      Authorization.

	 	
      1.1
	
      Company
      hereby grants to IKON a non-exclusive right and license to distribute,
      market and sell to end-user customers (“Customers”), maintain, support,
      use for demonstration purposes and display the Products or any part
      thereof, within the North America (the “Territory”). Licenses granted to
      Customers shall be between Company and such Customers. Such licenses shall
      be contained in the Products, and shall include the license terms set
      forth on Exhibit
      B hereto.
      Company hereby grants IKON a non-exclusive right to use any of Company's
      trade names, trademarks or logos, as supplied by Company from time to
      time, on or with the Products and or material in connection with the
      marketing of the Products, provided that IKON obtains Company’s prior
      written approval of any materials distributed by IKON which contain
      Company’s trade names, trademarks or logos. IKON shall use commercially
      reasonable efforts to market and promote the Products throughout the
      Territory. In the event of any default by any end-user of its obligations
      under any lease, purchase, equipment or service agreement between IKON and
      any end-user, or under the License Agreement between Company and such
      end-user, or in the event that licensed the Product is accepted for return
      for any reason within ninety (90) days of the applicable license date,
      IKON shall be entitled to transfer or assign, the underlying Product
      license relating to such end-user to any other end-user in mitigation its
      losses arising from such default.

	 	
      1.2
	
      IKON
      shall have the right to distribute any other products, including products
      that may compete with the Products.

 

2

 

	 	
      1.3
	
      Company
      hereby grants to IKON the right to use and display Company’s trademarks
      (the “Company Trademarks”), but solely in connection with and to the
      extent necessary for the marketing, distribution and support of the
      Products under this Agreement. IKON’s use shall be in accordance with
      Company’s trademark guidelines, as issued by Company to IKON in writing
      from time to time. IKON shall not remove or alter Products’ copyright
      notices, trademarks, logos or packaging. Company retains all rights in the
      Company Trademarks except as specifically granted to IKON in this section.
      In connection herewith, IKON authorizes Company to use its name and
      pre-approved IKON trademarks solely for purposes of marketing the nature
      of the reseller relationship contemplated by this Agreement. IKON retains
      all rights in and to such name and trademarks, which must be used in
      accordance with IKON’s trademark
guidelines.

	 	
      1.4
	
      Company
      hereby grants to IKON the right to use and display Company’s copyrighted
      materials (including software and printed materials included with the
      Products), but solely in connection with and to the extent necessary for
      the marketing, distribution and support of the Products under this
      Agreement. Company retains all rights in the materials except as
      specifically granted to IKON in this
section.

	
      2.
	
      Obligations
      of IKON.

	 	
      2.1
	
      IKON
      will use commercially reasonable efforts to make the Products available to
      Customers.

	 	
      2.2
	
      IKON
      will advertise and/or promote the Products in a commercially reasonable
      manner and will transmit Product information and promotional materials to
      Customers, as reasonably necessary.

	 	
      2.3
	
      IKON
      will provide Company with monthly “sales out” reports describing IKON’s
      sales of Products by district and Product, and identifying the zip code
      areas covered by each district.

	
      3.
	
      Obligations
      of Company.

	 	
      3.1
	
      In
      addition to its other obligations hereunder, Company shall provide IKON
      with sales training for IKON’s sales personnel free of charge as
      reasonably requested by IKON. Company shall also provide IKON with
      technical training, the pricing for such services being the then current
      rate. Company shall maintain a fully trained staff of service and support
      personnel in order to perform its obligations hereunder.
  

	 	
      3.2
	
      IKON
      intends to support field based system engineers from help desks in Orlando
      and Scottsdale. Company will offer free training on site for help desk
      engineers as a one-time event and keep the help desk personnel up to date
      with tech bulletins and software update information as it becomes
      available. In addition, Company will offer additional on site training as
      Company determines it's necessary in the event of significant product
      updates of additional product offerings. Company will also offer IKON help
      desks a technical support "priority" hot line. This hotline shall be
      manned from 9:00 AM to 5:00 PM eastern standard time by a qualified
      Products support professional. IKON will not be responsible for any travel
      expenses incurred by Company in connection with its Product support
      obligations, unless and only to the extent approved in writing by IKON in
      advance.

3

	 	
      3.3
	
      Company
      will supply IKON with (4) complete Product licenses (Virtual dongles) with
      access codes and documentation for delivery to the help desks, to support
      the above training effort, all at no charge. Such software may be freely
      used and will be secured by printing a demonstration watermark on all
      printed pages. Company and IKON will agree to regular web based training
      dates at which time Company will demo products for IKON sales and
      introduce its Company Sales Agents that shall provide support to IKON
      representatives. IKON and Company will agree on an initial set of target
      accounts and may mutually revise such lists from time to time. IKON will
      provide the names and contacts of all assigned Company sales
      representatives and may revise such names and contacts from time to time.
      IKON will engage company sales representatives to assist in providing
      demonstrations and securing final service agreements from the Company.
      IKON agrees not to directly pursue sale of Company Products without
      engaging with a Company Sales Agent or Company
  management.

	
      4.
	
      Purchase
      Orders.
      All
      orders entered by IKON under this Agreement shall be placed by written
      purchase order or shall be confirmed in writing within (5) working days of
      oral placement, shall refer to this Agreement, and shall specify
      (i) the quantity and description of Products; (ii) requested
      delivery date(s); (iii) applicable price; (iv) the location to
      which the Product is to be shipped; and (v) shipping
      instructions.

	
      5.
	
      Omitted
      - The confidential portion omitted is being separately filed with the
      Commission.

	
      6.
	
      Shipping.

	 	
      6.1
	
      Unless
      otherwise specified in writing by Company, title and risk of loss shall
      pass on FOB terms upon delivery to carrier mutually agreed to by the
      Parties at Company’s warehouse.

	 	
      6.2
	
      Company
      shall use commercially reasonable efforts to deliver the Products on the
      delivery date specified in the applicable written purchase order and to
      ensure that the service provided is running according to the
      specifications provided. Company shall use all commercially reasonable
      efforts to notify IKON of any delay in shipping or if a specific delivery
      date cannot be achieved. Normal shipment time is five (5) days after
      receipt of the purchase order. All Products delivered pursuant to this
      Agreement shall be marked for shipment to IKON’s address set forth above
      or to the address specified in the applicable written purchase order. Upon
      receipt, IKON and/or the Customer may inspect all Products and packaging
      for shipping damage and may reject any damaged or inoperable
      item.

4

	
      7.
	
      General
      Indemnity; Warranty.

	 	
      7.1
	
      Company
      agrees to protect IKON and hold it harmless from any loss or claim
      incurred by IKON to the extent arising out of defects in any Product
      existing at the time such Product is delivered by Company, or any
      warranties or representations of Company relating to the Products,
      provided that IKON gives Company immediate notice of any such loss or
      claim and cooperates fully with Company in the handling thereof.
      IKON
      agrees to protect Company and hold it harmless from any other kind of loss
      or claim incurred by IKON to the extent arising out of its installation of
      any of the Products sold hereunder, including any loss or injury to the
      property or person of Customers or Customers’ representatives or
      employees, or any other person,
      provided that Company gives IKON immediate notice of any such loss or
      claim and cooperates fully with IKON in the handling
    thereof.

	 	
      7.2
	
      Company
      warrants that the Products shall be free from any defects in material and
      workmanship and will perform in accordance with all specifications
      relating thereto.
      Company shall use its commercially reasonable efforts to insure that the
      Products, at the time of delivery, shall be feee of any virus or other
      program routine designed to erase or otherwise harm data or other programs
      of the end user. Company further warrants that Company owns the Products,
      including all associated intellectual property rights, or otherwise has
      the right to grant IKON and its customers the right and license provided
      in this Agreement, and that neither the Products nor the associated
      documentation infringe any patents, copyrights, trademarks, or other
      proprietary rights of any third parties.

	 	
      7.3
	
      Company
      warrants that the Products, individually or configured together as a
      system, will correctly (i) recognize, accept, compare, sequence, store,
      retrieve, display, compute and process date-data relating to century and
      day-of-the-week recognition, including single century formulas and
      multi-century formulas, leap years; (ii) exchange date-data and interface
      with other software, firmware and computer hardware with which it
      interacts, provided, that such interacting software, firmware or computer
      hardware is itself capable of properly and correctly exchanging accurate
      date-data; and (iii) accept and respond to two-digit date-data input in a
      manner that resolves any ambiguities as to the century in a defined,
      predetermined and appropriate manner. IKON
      shall have the right to assign and otherwise pass through its rights under
      this warranty to its customers.

	 	
      7.4
	
      EXCEPT
      TO THE EXTENT ARISING IN CONNECTION WITH ITS INDEMNIFICATION OBLIGATIONS
      HEREUNDER, NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY INCIDENTAL
      OR CONSEQUENTIAL DAMAGES ARISING IN CONNECTION WITH THE TRANSACTIONS
      CONTEMPLATED HEREBY.

	
      8.
	
      Confidential
      Information.
      “Confidential Information” shall mean all information, know-how, trade
      secrets or other material disclosed by one Party to the other pursuant to
      this Agreement which is marked “Confidential,” “Proprietary” or in some
      similar manner, including pricing information and the terms and conditions
      of this Agreement. Each Party shall treat as confidential all Confidential
      Information of the other Party, shall not use such Confidential
      Information except in connection with implementing this Agreement and
      shall not disclose such Confidential Information to any third party who
      has not executed an agreement to maintain the confidentiality of the
      Confidential Information with restrictions at least as restrictive as
      those set forth herein. All technical, business, sales, distribution
      channel, financial, marketing, pricing, planning and competitor
      information and the customer lists of Customers who have purchased
      Products from IKON are considered Confidential Information. Both Parties
      will ensure their compliance with all state or federal privacy acts to the
      extent required to allow the other to use such information for its
      continuing business operations, development and marketing purposes.
      Confidential Information does not include information that is (i)
      generally known and available in the public domain through no fault of the
      receiver; (ii) was known by the receiver prior to the date of disclosure;
      (iii) was received from a third party without any obligation of
      confidentiality; or (iv) was independently developed without reliance on
      Confidential Information. Given the nature of the Confidential Information
      and the likely consequences for each Party’s business where unauthorized
      use or disclosure of the Confidential Information occurs, monetary damages
      would not be an adequate remedy and each Party reserves the right to seek
      and obtain injunctive relief, in addition to any other remedy that may be
      available, in any proper forum.

5

	 	
      8.1
	
      Marketing
      and Public Relations

Neither
party may disclose the terms of this Agreement, or advertise, market or
otherwise publicize or disclose any information concerning the relationship of
the parties hereunder or any other such information in connection herewith and
therewith without the prior written consent of the other party.

	 	
      8.2
	
      Marketing
      Development Funds

Omitted -
The confidential portion omitted is being separately filed with the
Commission.

6

	
      9.
	
      Term
      and Termination.
      The initial term of this Agreement shall commence on the date signed by
      Company, and shall continue for one (1) year thereafter unless terminated
      or renewed as provided below:

	 	
      9.1
	
      Either
      Party may terminate this Agreement upon thirty (30) days written notice of
      a material breach to the other and failure by the other to cure such
      material breach within the thirty (30) day period.

	 	
      9.2
	
      Either
      Party may terminate this Agreement without cause and for any reason
      whatsoever upon sixty (60) days prior written notice to the
      other.

9.3  This
Agreement shall terminate immediately should either Party become insolvent or
should bankruptcy proceedings be commenced for or against either Party.9.4 At
the end of the initial term, this Agreement shall be automatically renewed for
successive one (1) year terms, unless terminated by either party by written
notice to the other not less than sixty (60) days before the end of the initial
term or any renewal period.

The
parties each acknowledge and agree that certain customer relationships relating
to the Products and services contemplated hereby may extend, by their terms,
beyond the term of this Agreement. Accordingly, notwithstanding termination or
expiration of this Agreement for any reason, the parties agree to work together
in the exercise of good faith to develop and implement such post-termination
support solutions, on a case by case basis, as may be reasonably necessary to
satisfy any surviving customer obligations.

	10.	
      Source
      Code Escrow

	 	
      10.1
	
      The
      Parties shall enter into a standard escrow agreement with a third party
      escrow agent regarding escrow of the source code for the software Products
      covered hereunder. IKON will pay the fees for the maintenance of such
      escrow account. 

	 	
      10.2
	
      Upon
      the occurrence of a Source Code Delivery Event, Company shall deliver to
      IKON a full and complete set of the source code, for the most current
      version of each of the software Products, on computer magnetic media; all
      necessary and available information, proprietary information, and
      technical documentation that shall enable IKON to create, maintain and/or
      enhance the software Products without the aid of Company or any other
      person or reference to any other materials; maintenance tools (test
      programs and program specifications); proprietary or third-party systems
      utilities (compiler and assembler descriptions); description of the
      system/program generation; and descriptions and locations of programs not
      owned by Company, but required for use and/or support. The license granted
      hereunder includes the right, exercisable upon such delivery, to use such
      materials for purposes of IKON's providing internally, or procuring from
      independent contractors, such maintenance and support as IKON may require
      with respect to the software Products and, as incident thereto, to copy
      and modify the source code of the software Products in support of the
      authorized uses of the software Products.

	 	
      10.3
	
      For
      purposes of this Agreement, "Source Code Delivery Event" means that either
      (i) IKON and/or any Customer encounters Company's inability, failure, or
      unreasonably refuses to correct material error(s) in the software Products
      following completion of the remedial procedures provided in this
      Agreement, for any reason, or otherwise to carry out in any material
      respect the maintenance or support obligations set forth in the
      Maintenance Agreement for any reason; (ii) Company files a petition in
      bankruptcy or petition to take advantage of any insolvency action, makes
      an assignment for the benefit of its creditors, consents to the
      appointment of a receiver for itself or the whole or substantially all of
      its property, is adjudicated a bankrupt on a petition in bankruptcy filed
      against it, files a petition or answer seeking reorganization or
      arrangement or other aid or relief under any bankruptcy or insolvency laws
      for the relief of debtors, or is the subject of an order, judgment, or
      decree entered by a court of competent jurisdiction appointing a receiver
      for Company or the whole or substantially all of its property, or approval
      of a petition filed against Company or the whole or substantially all of
      its property, or approval of a petition filed against Company seeking
      reorganization or arrangement of Company under any bankruptcy or
      insolvency laws or any other law for the relief of debtors; or (iii)
      Company ceases to reasonably support the software
  Products.

7

	
      11.
	
      Effect
      of Termination.
      Upon termination, neither Party shall be liable to the other for any
      indirect or consequential damages or costs, including lost profits, losses
      on unfulfilled contracts, or losses of any commitment or investment made
      in reliance upon this Agreement or the representations of the Parties. All
      indemnity and warranty obligations, and IKON’s obligations to pay for
      Products and to service Products shall survive. IKON shall cease
      representing that it is authorized to sell Company products and shall
      cease using any Trademarks. Upon expiration or earlier termination of this
      Agreement, IKON shall return, or destroy and certify such destruction in
      writing, all materials hereunder that utilize or display the Company’s
      Trademarks. 

	
      12.
	
      Infringement
      Indemnification by Company.
      Company shall indemnify and hold IKON harmless from and against any and
      all claims brought against IKON, and shall reimburse IKON for any
      judgments, damages, cost or expenses payable by IKON to the party bringing
      such action together with costs and expenses incurred by IKON, including
      reasonable attorneys’ fees relating thereto, as a result of any
      infringement by the Products of any third party’s intellectual property
      rights. If the Products, or any part thereof, are, or in the reasonable
      opinion of Company is likely to become, the subject of any claim for
      infringement of such third party intellectual property rights, or if it is
      judicially determined that the Products, or any part thereof, infringes
      any such third party’s intellectual property rights, then Company may, at
      its option and expense, either (i) procure for IKON the right under such
      third party intellectual property rights to sell or use, as appropriate,
      the Products or (ii) replace or modify the Products or parts thereof, with
      other suitable and reasonably equivalent technology or parts so that the
      Products become non-infringing or (iii) if it is not commercially
      reasonable to take the actions specified in items (i) and (ii) immediately
      preceding, repurchase from IKON any Products remaining in IKON’s inventory
      together with shipping and insurance costs incurred by IKON for such
      Products.

	
      13.
	
      Assignment.
      This Agreement is personal to Company and IKON and shall not be assigned
      by either without the prior written consent of the
  other.

	
      14.
	
      No
      Agency.
      This Agreement does not constitute IKON as a partner, agent, or franchisee
      of Company, or authorize IKON to represent or act for Company in any
      manner, or create any obligation on behalf of Company. IKON shall be
      solely responsible for determining its resale prices and, except as
      expressly set forth herein, shall operate its business in whatever manner
      it deems appropriate.

	
      15.
	
      Counterparts.
      This Agreement may be executed in one or more counterparts, each of which
      shall be deemed an original, but all of which together shall constitute
      one and the same instrument; however, this Agreement shall be of no force
      or effect until executed by both
Parties.

	
      16.
	
      No
      Implied Waivers.
      The failure of either Party at any time to require performance by the
      other Party of any provision hereof shall not affect in any way the full
      rights to require such performance at any time thereafter. The waiver by
      either Party of a breach of any provision hereof shall not be taken,
      construed, or held to be a waiver of the provision itself or a waiver of
      any breach thereafter or any other provision
hereof.

8

	
      17.
	
      Entire
      Agreement.
      The entire agreement between the Parties is incorporated in this Agreement
      and the Exhibits, which supersede all prior discussions and agreements,
      including all contrary terms in IKON’s purchase orders or other writings.
      There are no representations, agreements or understandings, expressed or
      implied, affecting this Agreement which are not expressly set forth
      herein. This Agreement may only be modified by a written agreement signed
      by both Parties. This Agreement shall not be supplemented or modified by
      any course of dealing, trade usage or any inconsistent terms in any
      purchase order or confirmation.

	
      18.
	
      Compliance
      with Applicable Laws.

	 	
      18.1
	
      Export
      and Import Controls.
      IKON acknowledges that the Products and the technical data received from
      Company in accordance with the terms hereunder may be subject to export
      and import controls of the United States or another government authority
      in the Territory. In the performance of its obligations, IKON will comply
      with all laws, regulations and orders, and agrees to commit no act which,
      directly or indirectly, would violate any United States or any other
      applicable law, regulation or order.

	 	
      18.2
	
      Authorizations.
      Each party shall at its own expense make, obtain, and maintain in force at
      all times during the term of this Agreement, all filings, registrations,
      reports, licenses, permits and authorizations (collectively
      “Authorizations”) required under applicable law, regulation or order
      required for it to perform its obligations under this
      Agreement. 

	
      19.
	
      Compliance
      with Laws. 
      The parties shall be mutually responsible, as applicable, for complying
      with the laws and regulations applicable in the Territory, or any nation,
      or political subdivision thereof, in which they engage in business in
      performing their respective responsibilities hereunder. Each party will
      bear their applicable expenses and costs related to compliance with such
      laws and regulations.

 

	
      20.
	
      Governing
      Law.
      This Agreement shall be governed by the law of the Commonwealth of
      Pennsylvania.

The
parties executing this Agreement warrant that they have the requisite authority
to do so.

 

	IKON OFFICE
      SOLUTIONS, INC.	 	COMPANY
	 	 	 
	
      By:
      ______________________________
	 	
            
      

      By:
      ________________________

	 	 	 
	
      Name:
      Dan
      Nero
	 	
      Name:
      Mark
      L. Mroczkowski

	 	 	 
	
      Title:
      National
      Director of Professional Services
	 	
      Title:
      Senior
      Vice President and CFO

	 	 	 
	
      Date:
      ____________________________
	 	
      Date:
      March
      11, 2005

 

9

 

EXHIBIT
A

 

Omitted -
The confidential portion omitted is being separately filed with the
Commission.

 

10

EXHIBIT
B

FORM
OF LICENSE AGREEMENT

 

 

The
actual licenses set forth in this Exhibit B granted to end-user customers shall
run from Company to such customers and shall contain the terms and conditions
set forth in the attached form of License Agreement. Any revisions must be
pre-approved in writing by Company. Such form shall at all times include the
following clause:

 

IKON
Agreement. This
Agreement shall not be deemed in any manner to alter, modify or amend in any
manner whatsoever the terms and conditions of any agreement between Customer and
IKON Office Solutions, Inc. and/or IKON Financial Services (“IFS”). All of the
rights and obligations of Customer under such agreements shall continue in full
force and effect notwithstanding any termination, cancellation, waiver or claim
arising under this agreement. In the event of default by Customer under any such
agreement, IKON Office Solutions, Inc. and/or IFS may, in addition to any other
remedies it may have, elect to terminate your license and/or remove any or all
licensed products and equipment.

 

 

 

 

HOSTED
SERVICES AGREEMENT

 

THIS
HOSTED SERVICES AGREEMENT (this
“Agreement”) is
made as of this ___ day of _______, 2005 (the “Effective
Date”) by and
between Sequiam Software, Inc., a California corporation (the “Company”) with
principal offices located at 300 Sunport Lane, Orlando, FL 328089 and the entity
identified below (the “Subscriber”).

WITNESSETH

WHEREAS, the
Company develops, markets, owns and operates services known as: (a) Print It,
123!, which enables subscribers to print or copy documents from their computer
to printers at local or other sites; and (b) Scan It, 123!, which enables
subscribers to scan documents and transmit such scanned documents to a central
print manager (Print It, 123! and Scan It, 123! and other services referred to
under the brand Smart Access Suite are hereinafter collectively referred to as
the “Services”);

WHEREAS, the
Company provides the Services online by accessing the Services using an Internet
website;

11

WHEREAS, the
Subscriber has evaluated the Services and examined the capabilities of the
Services, and now wishes to subscribe and obtain access to the Services subject
to the terms and conditions of this Agreement; and

WHEREAS, the
Company desires to grant to the Subscriber and the Subscriber desires to obtain
from the Company a non-exclusive license to access the Services subject to the
terms and conditions of this Agreement.

NOW,
THEREFORE, in
consideration of the mutual benefits of the covenants and restrictions herein
contained, the Company and the Subscriber hereby agree as follows:

1.    Definitions

(a)    “Authorized
Person” shall
mean: (i) employees and legal counsel of the Subscriber who agree to maintain
the confidentiality of the Confidential Information in consideration for
receiving such Confidential Information; and (ii) individuals or organizations
who are authorized in writing by the Subscriber to receive the Confidential
Information.

(b)    “Documentation” shall
mean the documents, instructions and other materials furnished or published by
the Company concerning the Services.

(c)    “Enhancement” shall
mean: (i) modifications to the Services which improve or expand the
functionality or features of the Services and which may be released by the
Company from time to time for a fee at the Company’s discretion; or (ii) such
modifications as requested by the Subscriber and approved by the Company in
writing.

(d)    “Password” shall
mean that certain password and user name assigned by the Company to the
Subscriber for purposes of accessing the Services.

(e)    “Subscriber
Data” shall
mean any information, data, or any other technology uploaded, posted, processed,
transmitted, or submitted by the Subscriber.

(f)    “Subscriber
Facilities” shall
mean the office facilities of the Subscriber.

(g)    “Unauthorized
Access” shall
mean any access to the Services or Documentation except for: (i) the exclusive
purposes of using and accessing the Services according to the Documentation on
the Internet using the Password; (ii) searching, retrieving, processing, and
downloading Subscriber Data; and (iii) training employees of the Subscriber in
the use of the Services.

(h)    “Unauthorized
User” shall
mean any individual who accesses the Services or Documentation except for: (i)
employees of the Subscriber authorized by the Subscriber to access the Services
and Documentation for: (x) the exclusive purpose of using and accessing the
Services according to the Documentation on the Internet using the Password and
(y) searching, retrieving, processing, and downloading Subscriber Data; (iii)
training employees of the Subscriber in the use of the Services; and (ii)
Authorized Persons who are authorized in writing by the Company to access the
Services and Documentation.

(i)    “Update” shall
mean modifications to the Services which improve or expand the performance of
the Services (as the case may be) which may be provided by the Company from time
to time, excluding Enhancements.

12

2.    License

(a)    Grant
of License. The
Company hereby grants, and the Subscriber hereby accepts, a non-exclusive,
non-transferable license to access the Services and to use the Documentation at
the Subscriber Facilities for the License Term (defined below), and to use the
Services and the Documentation as expressly provided herein.

(b)    Additional
Restrictions on Use.
Subscriber is expressly prohibited from:

i)
     modifying
the Services or allowing the Services to be modified without the prior written
consent of the Company. If the Services are modified, such modifications shall
be the sole and exclusive property of the Company and the Company shall own all
of the rights, title and interests to such modifications and any resulting
computer software, including (but not limited to) any and all copyrights,
patents and trade secrets related thereto;

ii)     using the
Services or any materials incident thereto to develop computer software without
the prior written consent of the Company;

iii)    using the
Services for any purpose other than as originally intended by this Agreement;
and

iv)    causing
or permitting the reverse engineering, reformatting, recasting, disassemble or
recompilation of the Services.

(c)    Password. Upon
payment as provided in Section 3, the Company shall assign to the Subscriber the
Password for purposes of accessing and using the Services during the License
Term. The Subscriber shall access the Services only using the Password. The
Subscriber shall be responsible for the confidentiality and maintenance of the
Password. The Subscriber shall not assign the Password and all assignments of
the Password by the Subscriber shall be void. Upon termination of this Agreement
in accordance with Section 5 herein, the Password shall be automatically
cancelled.

(d)    Unauthorized
Use. The
Subscriber shall take reasonable measures to prevent Unauthorized Users from
accessing the Services and Documentation and from using the Password. The
Subscriber shall take reasonable measures to prevent Unauthorized Access to the
Services, Documentation, and Password.

(e)    Lawful
Purpose. The
Subscriber represents and warrants that the Subscriber Data and the Subscriber’s
access to the Services shall not violate any contract, statute, rule,
regulation, or other obligation under which the Subscriber is bound. The
Subscriber further represents and warrants that it shall not access the Services
to conduct or solicit the performance of any business or activity that is
tortious or prohibited by law.

(f)    Access. The
Subscriber hereby acknowledges that the Services require establishment and
maintenance of a dedicated Internet access to the Services by the Subscriber
with specific provision capacity that is purchased by the Subscriber. The
Company shall provide necessary additional bandwidth as specified by the Company
from time to time and as may be modified by the Company from time to time.
Acquiring access to the Services does not include the establishment and
maintenance of Internet access to the Services. The Subscriber shall be
responsible for any costs in connection with accessing the Services on the
Internet, including (without limitation) telephone, communications, Internet
service provider costs, computer hardware, modem, fees charged by third parties,
insurance, Internet access software, or any other costs incurred by the
Subscriber in accessing the Services.

(g)    Subscriber
Data. The
Subscriber hereby grants The Company a worldwide and non-exclusive license to
use and transfer the Subscriber Data, in whole or part, for the purpose of
maintaining the Services or performing the Services pursuant to this Agreement.
The Company will use all reasonable commercial means to ensure the confidential
transfer of the Subscriber Data by means of industry standards encryption. The
Company will control access to all physical hosting to ensure the
confidentiality and integrity of the Subscriber Data. The Company shall not have
the obligation to access, review, maintain or store the Subscriber Data without
fees. The Subscriber may purchase such services at fees offered by the Company
pursuant to this Agreement. The Subscriber shall be responsible for uploading,
converting, and maintaining the Subscriber Data.

13

3.    Fees
and Taxes

(a)    Fees. In
consideration for the license granted by the Company under this Agreement, and
all services provided by the Company under this Agreement, the Subscriber shall
pay a fee in accordance with the following schedule. The Subscriber may also be
charged fees for other professional services or internet services that may be
mutually agreed to the Subscriber and the Company.

	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 

(b)    Taxes. All
fees described herein are exclusive of all federal, state, municipal or other
governmental excise, sales, value-added, use, personal property and occupational
taxes, excises, withholding obligations and other levies now in force or enacted
in the future and, accordingly, the Subscriber will pay all such taxes and
levies other than any tax or levy on the net income of the Company.

(c)    Fee
Increases. The
Company may increase the Dongle fee and the Scan It 123! fee and any additional
fees at any time by written notice to the Subscriber at least 30 days in advance
of the effective date of such increase. The new fee will not apply to any Dongle
purchased until a new Dongle is acquired by the Subscriber. If the Subscriber
objects to such increase, the Subscriber may terminate this Agreement in
accordance with Section 5 herein.

(d)    Failure
to Pay Fees. The
Subscriber hereby acknowledges that the Company may deactivate the Password and
deny access to the Services if the Subscriber fails to pay any amount due under
this Agreement on or before the 45th day after receipt of the invoice. Once the
Company receives payment from the Subscriber, the Password will be reactivated
and access to the Services will be restored. 

4.    Ownership

(a)    Title. The
Company represents that it owns all proprietary rights, including all patent,
copyright, trade secret, trademark, trade name and other proprietary rights, in
and to the Services, necessary to fulfill its obligations under the terms of
this Agreement. The Subscriber acknowledges that the license granted under this
Agreement does not provide the Subscriber with title to or ownership of the
Services, including any corrections, enhancements, updates or other
modifications to the Services, whether made by the Company or any third party.
The Subscriber acknowledges that the license granted under this Agreement only
provides the Subscriber a right of limited use under the terms and conditions of
this Agreement. The Subscriber shall keep the Services free and clear of all
claims, liens and encumbrances.

14

(b)    Transfer. Under
no circumstances shall the Subscriber sell, license, sublicense, publish,
display, distribute, or otherwise transfer to a third party the Services, any
copies thereof, in whole or in part, without the Company’s prior written
consent, unless otherwise provided for in this Agreement.

5.    Term
and Termination

(a)    Effective
Date and Term. This
Agreement and the license granted hereunder shall be effective as of the
Effective Date set forth at the beginning of this Agreement and shall remain in
effect until terminated as provided in this Agreement (the “License
Term”).

(b)    Termination
for Cause. The
Company shall have the right to terminate this Agreement and the license granted
herein upon the occurrence of any of the following events: (i) in the event the
Subscriber fails to comply with any of the terms and conditions of this
Agreement and such default has not been cured within 30 days after receiving
written notice; or (ii) in the event the Subscriber: (w) terminates or suspends
its business; (x) becomes subject to any bankruptcy or insolvency proceeding
under Federal or state statute; (y) becomes insolvent or subject to direct
control by a trustee, receiver or similar authority; or (z) has wound up or
liquidated, voluntarily or otherwise. The Subscriber shall have the right to
terminate this Agreement upon the occurrence of any of the following events: (i)
in the event the Company fails to comply with any of the terms and conditions of
this Agreement and such default has not been cured within 30 days after written
notice; or (ii) in the event the Company: (w) terminates or suspends its
business, (x) becomes subject to any bankruptcy or insolvency proceeding under
Federal or state statute; (y) becomes insolvent or subject to direct control by
a trustee, receiver or similar authority; or (z) has wound up or liquidated,
voluntarily or otherwise.

(c)    Effect
of Termination for Cause. If the
Company terminates this Agreement under Section 5(a) above, the obligations of
the Company and the Subscriber in Sections 2(b), (c), (d), (e), (f), and (g), 4,
5, 6, 7, and 8, and rights and obligations which accrued prior to termination or
expiration, and provisions of this Agreement which by their express terms are
intended to survive termination or expiration of this Agreement, shall survive
termination of this Agreement. Within 30 days after termination of this
Agreement, the Subscriber shall return to the Company, at the Subscriber’s
expense, any software or other materials related to the Services, and deliver to
the Company a certification, in writing signed by an officer of the Subscriber,
that any software or other materials related to the Services have been returned
or destroyed, as requested by the Company, and their use discontinued. Nothing
contained herein shall limit any other remedies that either party may have for
the default of the other under this Agreement nor relieve either party of any of
its obligations incurred prior to such termination.

(d)    Termination
Without Cause. In the
event the Subscriber desires to terminate this Agreement without cause, the
Subscriber shall provide written notice of same to the Company. Termination
shall be effective 30 days after date of such notice. In the event of the
Subscriber’s termination without cause, Sections 2(b), (c), (d), (e), (f), and
(g), 4, 5, 6, 7, and 8, and rights and obligations which accrued prior to
termination or expiration, and provisions of this Agreement which by their
express terms are intended to survive termination or expiration of this
Agreement, shall survive termination of this Agreement. Within 30 days after
termination of this Agreement, the Subscriber shall return to the Company, at
the Subscriber’s expense, any software or other materials related to the
Services, and deliver to the Company a certification, in writing signed by an
officer of the Subscriber, that any software or other materials related to the
Services have been returned or destroyed, as requested by the Company, and their
use discontinued. 

6.    Confidential
Information

(a)    Definition. For
their mutual benefit, the Company and the Subscriber shall discuss certain
confidential information including but not limited to, the Subscriber’s web
usage tracking and the Services. The parties acknowledge that: (i) the terms and
conditions of this Confidentiality clause; (ii) the existence and content of the
discussions between the Company and the Subscriber; and (iii) information
concerning the Services and other information, including but not limited to,
each party's plans, designs, costs, prices and names, finances, marketing plans,
business opportunities, personnel, research, development, source code, object
code, or
know-how, will be considered confidential (“Confidential
Information”).
Confidential Information shall not include information that: (i) is now or
subsequently becomes generally available to the public through no fault or
breach on the part of receiving party (the “Recipient”); (ii)
the Recipient can demonstrate to have had rightfully in its possession prior to
disclosure to the Recipient by the disclosing party (the “Discloser”); (iii)
is independently developed by the Recipient without the use of any Confidential
Information; or (iv) the Recipient rightfully obtains from a third party who has
the right to transfer or disclose it.

15

(b)    Nondisclosure
and Nonuse of Confidential Information. The
Recipient agrees to use reasonable care, but in no event no less than the same
degree of care that it uses to protect its own confidential and proprietary
information of similar importance, to prevent the unauthorized use, disclosure,
publication or dissemination of Confidential Information. The Recipient agrees
to accept the Discloser's Confidential Information for the sole purpose of
meeting its obligations under the terms of this Agreement. The Recipient agrees
not to use Confidential Information otherwise for its own or any third party's
benefit without the prior written approval of an authorized representative of
the Discloser in each instance. The Recipient may disclose Confidential
Information if required by any judicial or governmental request, requirement or
order; provided that the Recipient will take reasonable steps to give the
Discloser sufficient prior notice in order to contest such request, requirement
or order by notifying the Discloser of such request.

(c)    Ownership
of Confidential Information. All
Confidential Information, and any Derivatives thereof, remains the property of
the Discloser and no license or other rights to Confidential Information is
granted or implied hereby. For purposes of this Agreement, “Derivatives” shall
mean: (i) for copyrightable or copyrighted material, any translation,
abridgment, revision or other form in which an existing work may be recast,
transformed or adapted; (ii) for patentable or patented material, any
improvement thereon; and (iii) for material which is protected by trade secret,
any new material derived from such existing trade secret material, including new
material which may be protected by copyright, patent and/or trade
secret.

(d)    No
Warranty. All
Confidential Information remains the property of the Discloser and no license or
other rights in the Confidential Information is granted hereby. The Discloser
warrants that it has the right to disclose the Confidential Information to the
Recipient. Otherwise, all Confidential Information is provided “AS IS” and
without any warranty, express, implied or otherwise, regarding its accuracy or
performance. The Recipient will return all tangible Confidential Information,
including but not limited to all computer programs, documentation, notes, plans,
drawings, and copies thereof, to the Discloser immediately upon the Discloser's
written request.

(e)    Terms. The
Recipient's duty to protect the Discloser's Confidential Information shall
expire three (3) years from the date of disclosure of Confidential
Information.

7.    Limited
Warranty

(a)    Scope
of Limited Warranty. The
Company warrants to the Subscriber that for 90 days commencing upon the letter
of acceptance concerning the Services at the Subscriber's Facilities: (i) the
Services will substantially comply with the published specifications set forth
in the Company’s Documentation for the Services; and (ii) the media on which the
Services is furnished shall be free from defects in materials and faulty
workmanship under normal use (the “Initial
Warranty Period”). The
Company makes no warranty as to the Services after the ninety days. The Company
does not warrant that the Services will meet the Subscriber’s requirements or
will operate in combinations with other software or non-supported
platforms/operating systems/databases, which may be selected for use by the
Subscriber, or that the operation of the Services will be uninterrupted or
error-free. The Company also warrants to the Subscriber, that for a period of
ninety 90 days commencing upon delivery of any subsequent release of any new
version, Enhancement or Update of the Services, that new version Enhancement or
Update will substantially comply with the Documentation for that version,
Enhancement or Update.

16

(b)    Sole
Remedy. The
Subscriber’s sole and exclusive remedy under the Initial Warranty Period shall
be, at the Company’s election, to (i) provide program services to correct any
material defects which would cause the Services to not comply with the
Documentation; (ii) replace the defective Services with Services that complies
with the Documentation; or (iii) refund all license and support fees paid to the
Company which relate to the non-complying Services and may terminate this
Agreement immediately, subject to section 5. If the Company elects to pursue (i)
or (ii) and the Company is unable to complete that choice within 30 days of
notification by the Subscriber, then the Subscriber will be entitled to the
remedy under (iii). The above remedies are available only if the Company is
notified in writing, within the Initial Warranty Period, upon discovery of the
defects by the Subscriber, and that the Services have not been: (x) altered, or
modified by any party other than the Company or the Company’s approved third
party provider; (y) subjected to negligence, or computer or electrical
malfunction; or (z) used, adjusted, or installed other than in accordance with
instructions furnished by the Company. During subsequent Warranty Periods
related to any Enhancement or Update of the Services, the Subscriber’s sole and
exclusive remedy will be to continue to be supported under the prior Enhancement
or Update of the Services. Further, should the Subscriber hire a third party
independent consultant not contracted by the Company to perform services for the
Subscriber using the Services, or should said consultant create modifications or
derivative works of the Services, the Company shall have no liability to the
Subscriber for said services, modifications, derivative works, or outputs of use
of the Services.

(c)    Disclaimer
of Any Other Warranty. 
EXCEPT
FOR THE EXPRESS LIMITED WARRANTY STATED ABOVE, THE COMPANY MAKES NO PROMISES,
REPRESENTATION OR WARRANTIES, EITHER EXPRESS, IMPLIED, STATUTORY, OR OTHERWISE,
WITH RESPECT TO ANY SERVICES, INCLUDING ITS CONDITION, ITS CONFORMITY TO ANY
REPRESENTATION OR DESCRIPTION, OR THE EXISTENCE OF ANY LATENT OR PATENT DEFECTS,
AND THE COMPANY SPECIFICALLY EXCLUDES ALL IMPLIED WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE.

8.    Limitation
of Liability

(a)    The
Subscriber agrees that Company’s liability hereunder for damages arising from
performance or nonperformance of the Services, shall be as set forth above in
Section 7, and shall in the event of ordinary negligence not exceed the amount
paid by the Subscriber pursuant to this Agreement. With the exception of acts of
willful misconduct or gross negligence, the Subscriber and the Company agree
that the Subscriber and the Company will not be liable for any lost profits,
costs of procurement of substitute goods or services, or for any claim or demand
by any other party except in regard to violations under sections 2, 4, and 6 of
this Agreement. In no event will any party to this Agreement be liable for
consequential, incidental, special, indirect, or exemplary damages arising out
of this Agreement, even if the parties have been advised of the possibility of
such damages. These limitations shall apply notwithstanding any failure of
essential purpose of any limited remedy.

9.    Miscellaneous
Provisions

(a)    Notices. All
notices under this Agreement shall be in writing and shall be deemed to have
been given: (i) in the case of delivery, when delivered to the address set forth
on the signature page to this Agreement; (ii) in the case of mailing, on the
third business day after deposit in the U.S. Mail, postage prepaid, certified or
registered mail and addressed to the other party at the address set forth on the
signature page to this Agreement; and (iii) in all other cases when the same has
been actually received by the other party. Either party may change its address
to which said notices are to be sent by the giving of notice of such change as
set forth herein.

17

(b)    Force
Majeure. Neither
party shall be responsible for any failure to perform (except for payment
obligations) due to unforeseen circumstances or to causes beyond its control,
including but not limited to acts of God, war, riot, embargoes, acts of civil or
military authorities, fire, flood, accidents, strikes, carrier service
interruptions, power failure, computer failure, network telecommunications
activity, telecommunications and network failure, Internet failure, third party
software defects, or shortages of transportation facilities, fuel, energy, labor
or materials. A party whose performance is affected by a force majeure condition
shall be excused from such performance to the extent required by the force
majeure condition so long as such party takes all reasonable steps to avoid or
remove such causes of nonperformance and immediately continues performance
whenever and to the extent such causes are removed.

(c)    Headings. The
headings in this Agreement are for purposes of reference only and shall not
affect the meaning or construction of any provision of this
Agreement.

(d)    Severability. The
provisions of this Agreement are severable, and if any clause or provision shall
be held invalid or unenforceable in whole or in part in any jurisdiction, then
such invalidity or unenforceability shall affect, in that jurisdiction only,
such clause or provision, or part thereof, and shall not in any manner affect
such clause or provision in any other jurisdiction or any other clause or
provision of this Agreement in any jurisdiction.

(e)    Amendments,
Waivers and Consents. Any
amendment or waiver of any provision of this Agreement and any consent to any
departure from any provision of this Agreement shall be effective only if made
or given by both parties in writing.

(f)    Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original but all of which shall together constitute one and the same
agreement.

(g)    Governing
Law and Consent to Jurisdiction. This
Agreement shall be governed by, and construed in accordance with, the laws of
the State of Florida, without giving effect to the principles of conflicts of
law. The Company and the Subscriber consent to the jurisdiction of any federal
district court or state court having jurisdiction in Orange County,
Florida.

(h)    Entire
Agreement. This
Agreement constitutes the full understanding between the parties hereto with
respect to the subject matter hereof, and no statements, written or oral, made
prior to or at the signing hereof shall vary or modify the terms hereof.

[signature
on following page]

 

18

IN
WITNESS WHEREOF, the
parties hereto have executed this Hosted Services Agreement as of the date first
set forth above.

	
      THE
      COMPANY:
	
      THE
      SUBSCRIBER:

	 	 
	
      Sequiam
      Software, Inc.
	_____________________________
	 	 
	
      By: 
      _________________________________
	
      By:
      _________________________________

	
      Print
      Name:      Mark
      Mroczkowski                         
      
	
      Print
      Name: ___________________________

	
      Title:     
      Senior
      Vice President and
      CFO                
	
      Title:
      ________________________________

	
      Date:
      ________________________________ 
	
      Date:
      ________________________________

	
      Address: 
      300 Sunport Lane 
	
      Address:
      _____________________________

	
                        Orlando,
      FL 32809
	 

 

19

SCHEDULE
A

 HOSTED
SERVICE FEES AND PAYMENT PROVISIONS

	
      Company
	 	
      Start
      Date of Service
	 
	
      Billing
      Address
	 	
      Payment
      Terms
	
      Monthly

	
      City,
      State, Zip
	 	
      Project
      Name
	 
	
      Phone

      Fax

      URL
	 	
      Number
      of Users
	 
	
      Main
      Contact
	 	
      Email

       

      Direct
      Phone
	 
	
      Billing
      Contact
	 	
      Email

       

      Direct
      Phone
	 
	
      Technical
      Contact
	 	
      Email

       

      Direct
      Phone
	 

 

PAYMENT
TERMS

 

	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 

 

20<PAGE>

                                                                     Exhibit 4.1

May 16, 2005

AETHLON MEDICAL, INC.
7825 Fay Avenue, Suite 200
La Jolla, CA 92037

RE:      Convertible Promissory Note

Dear ladies and gentleman:

The undersigned, FUSION CAPITAL FUND II, LLC ("Fusion"), hereby purchases (1) a
$30,000 Convertible Promissory Note (the "Note") of AETHLON MEDICAL INC., a
Nevada corporation (the "Company") in the form attached hereto as EXHIBIT A and
(2) a common stock purchase warrant (the "Warrant") in the form attached hereto
as EXHIBIT B to purchase 300,000 fully paid and non-assessable shares of the
Company's common stock for a purchase price of $0.25 per share. The aggregate
purchase price for the Note and the Warrant shall be THIRTY THOUSAND DOLLARS
($30,000).

The shares underlying the Note and the Warrant shall be granted customary
"piggyback" registration rights.

Fusion acknowledges that it is an accredited investor and has sufficient
experience in business and financial matters to be able to evaluate the risks of
an investment in the Note and in the common stock of the Company, that the
securities to be issued are "restricted securities" and that Fusion is
purchasing the securities for its own account for investment purposes and not
with a view to resale or distribution of the securities.

Please indicate your acceptance of the foregoing by signing this letter
agreement below.

                                               Very truly yours,

                                               FUSION CAPITAL FUND II, LLC
                                               BY: FUSION CAPITAL PARTNERS, LLC
                                               BY: SGM HOLDINGS CORP.

                                               By:_______________________
                                               Name: Steven G. Martin
                                               Title: President
Acknowledged and agreed to this
16th day of May, 2005

AETHLON MEDICAL, INC.
By:______________________
Its:______________________

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