Document:

emms-ex102_7.htm

 

Exhibit 10.2

RESTRICTIVE COVENANT 

AND

TECHNOLOGY CROSS LICENSE Agreement

THIS RESTRICTIVE COVENANT AND TECHNOLOGY CROSS LICENSE AGREEMENT (this “Agreement”) is made and entered into effective as of March 10, 2020, by and among Lencore Acoustics Corporation, a New York corporation (the “Seller”), Jonathan S. Leonard (the “Stockholder”), Mercury Notifications LLC, a New York limited liability company (the “Subsidiary”) and EMMIS QOZ BUSINESS, LLC, an Indiana limited liability company (the “Purchaser” and together with the Seller Parties, the “Parties” and each, a “Party”).  Capitalized terms used and not defined herein shall have the meanings set forth in the Purchase Agreement (as defined below). 

Recitals

WHEREAS, the Stockholder owns certain outstanding equity securities of Seller;

WHEREAS, pursuant to an Asset Purchase Agreement (the “Purchase Agreement”) dated as of the date hereof, Purchaser has agreed to acquire the Acquired Assets as describe therein;

WHEREAS, each of Seller and Purchaser are not willing to consummate the transactions contemplated by the Purchase Agreement (collectively, the “Transaction”) absent execution and delivery of this Agreement by Purchaser and the Seller Parties, respectively at the closing of the Transaction; and

WHEREAS, each of the Purchaser and the Seller Parties are willing to execute and deliver this Agreement to induce Purchaser to consummate the Transaction.

WHEREAS, the Acquired Assets include all of the Company Intellectual Property (other than the Intellectual Property expressly identified within the Excluded Assets), including, without limitation, trade secrets, software code, technical knowledge and know-how relating to Sound Masking Systems;

WHEREAS, prior to the Effective Date, Seller has sold a relatively small number of Combination Mass Notification and Sound Masking Systems, which include both mass notification functionality and sound masking functionality, and has issued quotes for Combination Mass Notification and Sound Masking Systems to a relatively small number of additional potential purchasers;

WHEREAS the Acquired Assets and Excluded Assets each may include assets useful in either or both of Sound Masking Systems and in Mass Notification Systems;

WHEREAS, Seller desires to use and practice, and Purchaser desires to grant Seller the right to use and practice, the Purchaser Licensed IP for use in Mass Notification Systems on the terms and conditions set forth herein; 

1

 

 

WHEREAS, Purchaser desires to use and practice, and Seller desires to grant Purchaser the right to use and practice, the Seller Licensed IP for use in Sound Masking Systems on the terms and conditions set forth herein;

NOW, THEREFORE, in consideration of the premises, and for other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the Parties, intending to be legally bound, hereby agree as follows:

Section 1.Certain Defined Terms.  For purposes of this Agreement, the following terms have the following meanings:

(a)“Affiliate” means, with respect to any Person, any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such Person.  For the avoidance of doubt, the Seller and its subsidiaries shall be deemed to be Affiliates of the Stockholder and other Seller Parties for purposes of this Agreement.

(b)“Confidential Information” means all non-public information, data, documents, agreements, files and other materials of Purchaser included in the Acquired Assets, whether stored in written, electronic or other form or media, including all analyses, compilations, reports, forecasts, studies, samples and other documents which contain or otherwise reflect or are generated from such information, data, documents, agreements, files or other materials.  Without limiting the generality of the foregoing, the term “Confidential Information” includes: (i) any and all product specifications, data, know-how, formulae, compositions, processes, sketches, photographs, drawings, samples, inventions and ideas (past, current and planned), research and development, current and planned manufacturing or distribution methods and processes, computer software and programs (including object code and source code), database technologies, systems, structures and architectures (and related processes, formulae, composition, improvements, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods and information) included in the Acquired Assets; (ii) any and all information concerning the Restricted Business and/or the Acquired Assets (including customer lists, current and anticipated customer requirements, price lists, market studies, business plans, historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans); and (iii) any trade secrets concerning the Restricted Business.  The above list is not exhaustive, and Confidential Information also includes other information included in the Acquired Assets that is marked or otherwise identified as confidential or proprietary, or that would otherwise appear to a reasonable person to be confidential or proprietary in the context and circumstances in which the information is known or used.  Notwithstanding any other provision of this Agreement, “Confidential Information” shall not include: information (or any embodiment thereof) that is not as of the date hereof in the possession of or known to the Seller Parties.    

(c) “Control” means the ability to control the actions of an entity by virtue of possession of over fifty percent (50%) of the voting equity of such entity, or through contractual entitlement to voting control of such entity’s board of directors, management committee, or other similar executive governing body.

2

 

(d)“Combination Mass Notification and Sound Masking System” means a Mass Notification System that is capable of performing the functionality of both a Mass Notification System and a Sound Masking System.

(e)“Improvements” means all enhancements, improvements or modifications (whether or not patentable) made by a Seller Party on or to the Acquired Assets, or any portion thereof, and any new innovation relating to or useful in a Sound Masking System, to the extent made by Seller or a Seller Representative after the Effective Date, provided however, that this term expressly excludes any enhancement, improvement, modification or innovation to the extent that it is not derivative of the Acquired Assets or any other Improvement.

(f)“Know-How” means any and all specifications (including directions, instructions, technical information, test protocols and procedures); studies and analyses (including results); data (including manufacturing and production data); prototypes; technology; knowledge and information (including conceptions, ideas, innovations, discoveries, inventions, enhancements, modifications, processes, methods, formulae and techniques); documentation (including designs, drawings and plans); and software, pertaining to a particular technical subject matter, whether or not it is Confidential Information or qualifies as a Trade Secret.

(g)“Mass Notification System” means a unified communication system (including a network of loudspeakers, a power amplifier and controls) intended to optimize the clear, intelligible communication (which may be through voice and visual instructions, as well as alert and evacuation signals, and other communication methods, including SMS, email, popups, and social media) of critical information within buildings and/or outdoor areas about emergencies, including but not limited to fire, human-caused events (accidental and intentional), other dangerous situations, accidents, natural disasters, terrorist activities, hazardous chemical releases, severe weather, and other situations that may endanger the safety of the occupants of an area or facility.

(h)“Person” means an individual, partnership, corporation, business trust, limited liability company, limited liability partnership, joint stock company, trust, unincorporated association, joint venture, company or other entity or any governmental authority or agency.

(i)“Proprietary Information” means all Confidential Information that is not a Trade Secret.

(j)“Purchaser Field of Use” means use of Seller Licensed IP in furtherance of the design, manufacture and sale of Sound Masking Systems.  

(k)“Purchaser Licensed IP” means Intellectual Property that is a part of the Acquired Assets owned by Purchaser, whether patented or otherwise, whether documented or oral, including, without limitation, patents, patent applications, patentable inventions, utility models, industrial designs, rights in designs, know-how, copyrights, copyrightable works, copyright registrations, moral rights, topography rights, rights in databases, trade secrets, legally protectable technical information, engineering drawings, specifications, 

3

 

Confidential Information and any other intellectual property or proprietary rights eligible for protection under the laws of any country, state, or jurisdiction, in all cases whether or not registered or registerable and including registrations and applications for registrations of any of these and rights to apply for the same and all rights and forms of protection of a similar nature or having equivalent or similar effect to any of these anywhere in the world.  The foregoing shall not include any trademarks, service marks, trade dress, trade names, corporate names, domain names, uniform resource locators (urls), internet addresses, or applications for any of the foregoing items set forth in this sentence. 

(l)“Representative” means, with respect to a particular Person, any director, officer, manager, employee, agent, consultant, advisor or other representative of such Person, including legal counsel, accountants and financial advisors, solely to the extent and at such times as such Person is acting in such capacity.

(m)“Restricted Business” means the business of designing, developing, manufacturing, selling, marketing, servicing, licensing, commercializing and/or otherwise providing sound masking products and services, other than within the Seller Field of Use.

(n)“Seller Field of Use” means a use of Purchaser Licensed IP for:

(i)incorporation into Mass Notification Systems that have no sound masking functionality (i.e., that are not Sound Masking Systems) and performance of warranty work and servicing of Mass Notification Systems that have no sound masking functionality (i.e., that are not Sound Masking Systems);

(ii)incorporation into Combination Mass Notification and Sound Masking Systems that Seller sells, within six (6) months of the Effective Date, solely to the purchasers identified as “Existing Customers” or “Authorized Customers” in Appendix A; and

(iii)warranty work and maintenance of Combination Mass Notification and Sound Masking Systems sold pursuant to subsection (ii) immediately above or sold on or before the Effective Date.

(o) “Seller Licensed IP” means Intellectual Property that is either (i) a part of the Excluded Assets or (ii) an Improvement, in each case, owned by Seller, whether patented or otherwise, whether documented or oral, including, without limitation, patents, patent applications, patentable inventions, utility models, industrial designs, rights in designs, know-how, copyrights, copyrightable works, copyright registrations, moral rights, topography rights, rights in databases, trade secrets, legally protectable technical information, engineering drawings, specifications, Confidential Information and any other intellectual property or proprietary rights eligible for protection under the laws of any country, state, or jurisdiction, in all cases whether or not registered or registerable and including registrations and applications for registrations of any of these and rights to apply for the same and all rights and forms of protection of a similar nature or having equivalent or similar effect to any of these anywhere in the world.  The foregoing shall not include any trademarks, service marks, trade dress, trade names, corporate names, domain names, uniform resource locators (urls), internet addresses, or applications for any of the foregoing items set forth in this sentence.

4

 

(p)“Seller Party” means Seller, Stockholder and Subsidiary.

(q) “Sound Masking System” means a system of integrated components (including, but not limited to, a network of loudspeakers, electronic random sound/noise generators with an equalizer or sound spectrum shaper, a power amplifier and controls) that work together to deliver background sound to a space for a desired effect, such as, but not limited to, reducing noise distractions, protecting speech privacy, improving acoustics in a workplace or other space or increasing comfort.  

(r)“Territory of Restriction” means the geographic territory described on Exhibit A attached hereto.

(s)“Territory of License” means the universe.

(t)“Trade Secret” means all Confidential Information that is protected as such under the Defend Trade Secrets Act of 2016, 18 U.S.C. §§ 1836 et seq., the Uniform Trade Secrets Act, codified in Indiana as Ind. Code §§ 24-2-3-1 et seq., or by any other applicable trade secret law.

PART A - RESTRICTIVE COVENANT AGREEMENT

Section 2.Acknowledgments of the Seller Parties.  The Seller Parties hereby acknowledge the following matters, all of which are being relied upon by Purchaser in consummating the Transaction and in accepting the benefits of this Agreement:

(a)Stockholder has occupied a position of trust and confidence with the Seller and as a result of such position have become familiar with certain Confidential Information.

(b)All of the Confidential Information known by or in the possession of any Seller Party is the property of Purchaser.

(c)Purchaser, in purchasing the Acquired Assets has invested, substantial time, and money in purchasing the Restricted Business, which includes Confidential Information that Purchaser expects will provide it with a competitive advantage over others in the business that design, manufacture and sell Sound Masking Systems.

(d)Purchaser’s business operations are international in scope, and Purchaser expects the products and/or services related to the Restricted Business will be marketed throughout the world, and that in operating the Restricted Business, Purchaser will compete with other businesses that are, or could be, located in any part of the world.

(e)Purchaser has required that the Seller Parties make the covenants and agreements set forth in this Agreement as a condition to Purchaser consummating the Transaction, and Purchaser is relying on such covenants and agreements in consummating the Transaction.

5

 

(f)The covenants and agreements set forth in this Agreement are reasonable (including, where applicable, as to scope, duration and geographical area) and are necessary to protect and preserve Purchaser’s interests in and rights to the Restricted Business and/or the Acquired Assets.

(g)Purchaser may be irreparably damaged if the Seller Parties were to breach any of the covenants or agreements set forth in this Agreement.

(h)Money damages alone may not be adequate to compensate Purchaser for a breach or threatened breach of this Agreement by the Seller Parties.  

Section 3.Non-Competition Covenant.  For a period of five (5) years from the date hereof, each of the Seller Parties shall not (and shall not permit any of their controlled Affiliates to), directly or indirectly, in whole or in part:

(a)engage or invest in;

(b)own, manage, operate, finance or provide financial assistance to;

(c)control, participate in the ownership, management, operation, financing or control of;

(d)be employed by or associated with, whether as an employee, employer, owner, operator, manager, advisor, consultant, agent, partner, director, stockholder, officer, member or similar capacity;

(e)lend financial credit to; or

(f)render services or advice to,

any Person, business, company or enterprise that (directly or indirectly) is engaged in, or contemplates being engaged in designing, developing, manufacturing, selling, marketing, servicing, licensing, commercializing and/or otherwise providing Sound Masking Systems anywhere in the Territory of Restriction.  Notwithstanding the foregoing, the Seller Parties and their respective Affiliates may: (x) acquire, in the aggregate, not more than five percent (5%) of the equity securities of any such enterprise (but without otherwise participating in the activities of such enterprise) if such securities are listed and traded on any national securities exchange; and (y) conduct activities within the Seller Field of Use.

Section 4.Non-Solicitation of Employees and No-Hire Covenants.  Except as otherwise expressly set forth in the Transition Services Agreement, for a period of five (5) years from the date hereof, each of the Seller Parties shall not (and shall not permit any of its controlled Affiliates to), directly or indirectly, either for his, her or its own behalf or on behalf of any Affiliate to knowingly (including without limitation after five-day notice provided by Purchaser):

(a)induce or attempt to induce any employee of Purchaser to leave the employ of Purchaser;

6

 

(b)in any way interfere with the relationship between Purchaser and any of its employees; or

(c)recruit, hire, employ, or otherwise engage as an employee, independent contractor, or otherwise, any employee of Purchaser, except that a general solicitation which is not directed specifically to any such employees shall not be deemed a violation of the foregoing restrictions on solicitation but shall not be an exception to foregoing restrictions on hiring, employing or engaging Purchaser’s employees.

Section 5.Non-Interference; Non-Solicitation of Customers.  For a period of five (5) years from the date hereof, the Seller Parties shall not (and shall not permit any of their respective Affiliates to), directly or indirectly, either for his, her or its own behalf or on behalf of any Affiliate:

(a)solicit, contact or service (including, but not limited to, by way of electronic mail, social media, regular mail, express mail, telephone, facsimile, instant message and other forms of electronic transmission), or assist or participate in the solicitation, contact or service of, any customer, or distributor, of the Company’s Business and/or the Purchaser’s Restricted Business for the purpose of offering, accepting or providing goods or services competitive with those offered by Purchaser with respect to the Restricted Business; or

(b)induce any customer, supplier, distributor, licensee or other business relation of the Restricted Business to cease doing business with Purchaser or otherwise detract from or degrade Purchaser’s relationship with such Person with respect to Purchaser’s continued operation of the Restricted Business.

Purchaser acknowledges and agrees that (i) the Seller Parties will be actively engaged in the business of designing, developing, manufacturing, selling, marketing, licensing, commercializing and/or otherwise providing Mass Notification Systems after the Effective Date, and (ii) the Seller Parties’ activities solely with respect to Mass Notification Systems or as otherwise permitted by the Transition Services Agreement, this Agreement with respect to the Seller Field of Use or any other written agreement between Purchaser and a Seller Party or an Affiliate of a Seller Party shall not be considered a breach of Sections 5(a) or (c) above.

Section 6.Non-Disparagement.

(a)For a period of five (5) years from the date hereof, except as necessary or desirable to enforce the terms and conditions of the Purchase Agreement or any other Transaction Document, the Seller Parties shall not (and shall not permit any of his, her or its controlled Affiliates to) publish or communicate to any Person or in any public forum (including, without limitation, in any electronic forum) any defamatory or disparaging remarks, comments or statements concerning (A) Purchaser, or (B) the Restricted Business as conducted by Purchaser.

7

 

(b)For a period of five (5) years from the date hereof, except as necessary or desirable to enforce the terms and conditions of the Purchase Agreement or any other Transaction Document, Purchaser shall not (and shall not permit any of its controlled Affiliates to) at any time, directly or indirectly publish or communicate to any Person or in any public forum (including, without limitation, in any electronic forum) any defamatory or disparaging remarks, comments or statements concerning (A) the Seller Parties, or (B) the n.Form Business. 

(c)For purposes of this Section 6, a disparaging statement is any communication which, if publicized to another, would reasonably be expected to cause the recipient of the communication to question (i) the business condition, integrity, competence or good character of the Person to whom the communication relates, or (ii) the quality of the products and services offered by the Person to whom the communication relates and, for purposes of clarity and notwithstanding anything to the contrary herein, does not include any communication necessary or desirable to enforce the terms and conditions of the Purchase Agreement, this Agreement or any other Transaction Document.

PART B – TECHNOLOGY CROSS LICENSE AGREEMENT

Section 7.Licenses Granted.

(a) Purchaser to Seller.  Subject to the terms and conditions of this Agreement, Purchaser hereby grants to Seller a perpetual, irrevocable, non-exclusive, fully-paid, royalty-free, non-transferable license in and to the Purchaser Licensed IP, without right of sublicense (except as set forth in Section 7(c) herein), to design, develop, use, make, have made, import, export, offer to sell, sell, deliver, install, support, maintain and otherwise commercially exploit the Purchaser Licensed IP only in the Seller Field of Use in the Territory of License.

(b)Seller to Purchaser.  Subject to the terms and conditions of this Agreement, Seller hereby grants to Purchaser a perpetual, irrevocable, non-exclusive, fully-paid, royalty-free, non-transferable license in and to any Seller Licensed IP, without right of sublicense (except as set forth in Section 7(c) herein), to design, develop, use, make, have made, import, export, offer to sell, sell, deliver, install, support, maintain and otherwise commercially exploit the Seller Licensed IP only in the Purchaser Field of Use in the Territory of License.

(c)Limited Right to Sublicense.  Each of Seller and Purchaser may sublicense the rights granted under Section 7(a) and 7(b) (in each case, without any further right of sublicense and subject to the limitations of Section 8) to:

(i)any Affiliate or third-party service provider, in furtherance of provision of services to Seller or Purchaser, respectively, or to their respective customers in furtherance of the sale, installation, maintenance or repair of Mass Notification Systems, or Sound Masking Systems, as applicable; and

8

 

(ii)end users of Seller’s and Purchaser’s Mass Notification Systems and Sound Masking Systems, respectively, solely as necessary for such end users to use the relevant products and services included therein within the permitted Seller Field of Use or Purchaser Field of Use, respectively.

Section 8.Limitations and Obligations of Licensees.

(a)Each Party hereby acknowledges that the licenses granted in Section 7(a) and Section 7(b) are specific to the stated Seller Field of Use and Purchaser Field of Use, respectively, and hereby agree that it shall not use the Purchaser Licensed IP or Seller Licensed IP, as applicable outside thereof.  Further, Purchaser agrees not to use the Acquired Assets to sell Mass Notification Systems.

(b)Each Party hereby acknowledges that the licenses granted in Section 7(a) and 7(b) does not include any rights to trademarks, service marks, trade dress or trade names or any technology or Intellectual Property owned or licensed other than the Purchaser Licensed IP and Seller Licensed IP, as applicable.

(c)Nothing herein shall be construed as granting, by implication, estoppel or otherwise, any ownership right to Seller in or to the Purchaser Licensed IP or to Purchaser in the Seller Licensed IP.  

(d)Each Party agrees, for itself and its controlled Affiliates and permitted assigns, not to contest or challenge the validity or ownership of the other Party’s Intellectual Property associated with Purchaser Licensed IP or Seller Licensed IP, respectively.

(e)During the six-month period following the Effective Date, Seller shall provide monthly reports to Purchaser identifying all Combination Mass Notification and Sound Masking Systems properly sold to the purchasers identified as “Existing Customers” or “Authorized Customers” in Appendix A.

Section 9.Registration, Maintenance and Enforcement of Purchaser Licensed IP and Seller Licensed IP.

(a)Registration and Maintenance.  During the Term, each of Purchaser and Seller shall have the sole right, but not any obligation, in its sole discretion, to decide whether to pursue any patents, copyright registrations or any other form of intellectual property registration for each item of Intellectual Property that such Party owns and to decide whether to adopt or implement policies and practices with respect to the protection of such Intellectual Property, including the Purchaser Licensed IP, or Seller Licensed IP, respectively, including decisions whether to take any actions to file and prosecute, maintain in force, and enforce any intellectual property applications and/or registrations in the Territory of License.

9

 

(b)Unauthorized Use.  Each of Purchaser and Seller shall have the sole right, but not any obligation, in its sole discretion, to decide whether to take any action against any third party for infringement, misappropriation or such other violation which Purchaser or Seller (as applicable) determines to be appropriate (which may, but need not necessarily include, the initiation and prosecution of litigation with respect thereto).  To the extent Seller or Purchaser requests in writing, the other Party shall provide, at the requesting Party’s expense, reasonable cooperation in conducting such action.  Each Party shall have the sole right, at its sole discretion and at its expense, to control any suit or action taken on account of any such infringement, misappropriation, or other violation of its Intellectual Property.

(c)Inquiries.  Each of Seller and Purchaser shall promptly refer to the other Party any inquiry regarding the acquisition of or need for rights in the Purchaser Licensed IP or Seller Licensed IP, respectively.

(d)Disclosure of Improvements.  For a period of ten (10) years from the date hereof, upon receipt of a written request from Purchaser, but in no event more than once in any calendar year, the Seller Parties shall act in good faith to reasonably disclose to Purchaser any and all material Improvements that have been made by a Seller Party, either solely or jointly with any person, since the time of any prior disclosure or certification under this Section 9(d), to the knowledge of the Seller Parties after reasonable inquiry.  Notwithstanding anything to the contrary in this Agreement, the Seller Parties shall not be liable for any monetary or other damages arising from any failure to disclose information required by this Section 9(d), except to the extent that such failure is wilful or made in bad faith.

PART C – GENERAL PROVISIONS

Section 10.Representations and Warranties.

(a)Representations and Warranties.  Each Party hereto warrants, represents and covenants to the other Parties during the Term, as an essential part of this Agreement that: (i) each is duly organized and validly existing and in good standing under the laws of the state of its incorporation or formation, as applicable; (ii) each has all requisite power and authority to execute and deliver this Agreement and to perform his, her or its obligations hereunder; (iii) the execution of this Agreement has been duly authorized by each Party’s board of directors, or board of managers, as the case may be, and has been duly executed and delivered by each Party and constitutes the valid and legally binding obligation of each Party, enforceable in accordance with its terms; (iv) no Party has any agreement with, or obligation to, any third party that conflicts in any way with his, her or its obligations under this Agreement; and (v) no Party has, in any material respect, violated any applicable federal, state, local or foreign law, regulation or order or any other requirement of any governmental, regulatory or administrative agency or authority or court or other tribunal that would impair the rights granted by the Parties hereunder or materially impair such Party’s ability to perform its obligations hereunder (including any law, regulation, order or requirement relating to securities, properties, business, products, manufacturing processes, advertising, sales or employment practices or terms and conditions of employment).

10

 

(b)Disclaimer.  EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, EACH PARTY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY, NON-INFRINGEMENT BY THIRD PARTIES, FITNESS FOR ANY PARTICULAR PURPOSE, SAFETY OR EFFICACY RESPECTING ANY INFORMATION OR MATERIALS PROVIDED TO THE OTHER PARTY PURSUANT TO, OR IN ASSOCIATION WITH, PERFORMANCE OF THIS AGREEMENT, INCLUDING ANY WARRANTIES CONCERNING THE INHERENT PROPERTIES OF ANY PRODUCTS SOLD IN ACCORDANCE WITH THIS AGREEMENT, INFRINGEMENT OR MISSAPPROPRIATION OF ANY THIRD PARTIES’ INTELLECTUAL PROPERTY RIGHTS, OR VALIDITY OR ENFORCEABILITY OF ANY INTELLECTUAL PROPERTY RIGHTS.  DUE TO THE COMPLEX NATURE OF COMPUTER SOFTWARE, PURCHASER DOES NOT WARRANT THAT THE PURCHASER LICENSED IP IS, AND SELLER DOES NOTWARRANT THAT ANY SELLER LICENSED IP WILL BE, COMPLETELY ERROR FREE, WILL OPERATE WITHOUT INTERRUPTION, OR IS COMPATIBLE WITH ALL EQUIPMENT AND SOFTWARE CONFIGURATIONS.  EACH OF PURCHASER AND SELLER EXPRESSLY ASSUME ALL RISK FOR THEIR USE OF BOTH THE SELLER LICENSED IP AND PURCHASER LICENSED IP.  For the avoidance of doubt, any Party’s use of any Purchaser Licensed IP or Seller Licensed IP under this Agreement is considered to be a use of such Purchaser Licensed IP or Seller Licensed IP AS-IS.

Section 11.Assumption of Risk and Limitation of Remedies.  

(a)Assumption of Risk. Each of Purchaser and Seller assumes all responsibility for and all risk of damage or injury that may occur as a result of its (or any of its respective Affiliates’ or sublicensees’) making, having made, using, importing, exporting, offering to sell, selling and having sold any product in which it has incorporated any Purchaser Licensed IP or Seller Licensed IP, respectively.

(b)Limitation of Remedies.  Except with respect to (i) a Party’s wilful uncured breach of this Agreement, (ii) the provisions of this Agreement relating to Section A Restrictive Covenants and Section 13 (Confidentiality), and (iii) use of the Purchaser Licensed IP or Seller Licensed IP outside of the Seller Field of Use or Purchaser Field of Use, as applicable, under no circumstances will a Party be liable to the other Party for any indirect, incidental, consequential, special or punitive damages of any kind arising from or relating to this Agreement, the Purchaser Licensed IP or any Seller Licensed IP, whether grounded in tort (negligence, strict product liability or other tort), contract or other theory of liability and whether or not the other Party knows or has reason to know of the possibility of any such damages.  The sole monetary remedy for a breach of this Agreement shall be actual damages.  Notwithstanding the foregoing, punitive damages to the extent actually awarded to a third-party shall be recoverable hereunder.  Under no circumstances shall this Agreement be terminated, or any rights of any Party granted hereunder be limited beyond any limitations expressly specified herein.

11

 

Section 12.Indemnification.

(a)Mutual Indemnification.  Each Party agrees to defend, indemnify and hold harmless the other Party and the other Party’s Affiliates and their respective officers, directors, shareholders, members, employees, agents and customers from and against any and all losses, liabilities, damages, out-of-pocket costs and expenses (including reasonable attorneys’ fees) arising from, relating to or in connection with any third-party claim arising from, relating to or in connection with (i) a breach of any representation or warranty made by such Indemnifying Party in this Agreement; (ii) any breach or failure by such Indemnifying Party to comply with or perform fully any covenant or agreement under this Agreement; and/or (iii) the sale of any product by the Indemnifying Party (as defined below) to a third party, whether or not such sale involves a product that incorporates any Purchaser Licensed IP or Seller Licensed IP, as applicable, and whether or not such claim is made under a theory of design defect, manufacturing defect or any other theory of product liability or otherwise. 

(b)Procedure.  As a condition precedent to the obligations pursuant to Section 12(a), any Person entitled to indemnification hereunder (the “Indemnified Party”) shall give prompt written notice to the Party providing indemnification hereunder (the “Indemnifying Party”) of any claim covered by the indemnification obligations hereunder; provided, however, that a delay in such notice shall not terminate the Indemnifying Party’s indemnification obligations hereunder, unless such delay shall have materially impaired the defense of such claim.  The Indemnifying Party shall have sole and exclusive control of the defense of any such claim, including the choice and direction of any legal counsel.  The Indemnified Party shall cooperate, at the Indemnifying Party’s sole cost, expense or liability, with the Indemnifying Party with respect to such claim and the Indemnified Party shall promptly execute and deliver such documents, instruments or other agreements as may be requested by the Indemnifying Party with respect to any settlement or resolution thereof, provided that the Indemnified Party shall incur no liability, cost or expense in connection with such settlement or resolution.  The Indemnified Party may not settle or compromise any such claim without the prior written consent of the Indemnifying Party.

Section 13.Confidentiality Covenants of the Seller Parties.

(a)The Seller Parties shall not (and shall not permit any of their respective controlled Affiliates or Representatives to) communicate, disclose, divulge, reveal or convey (whether directly or indirectly, orally, in writing or otherwise, voluntarily or inadvertently) in any manner or by any means of communication whatsoever, any Confidential Information to any Person; provided, however, that the foregoing shall not restrict the Seller Parties (or any of their respective Affiliates or Representatives) from disclosing any Confidential Information: (x) that is or becomes generally known to and available for use by the public, other than as a result of the fault of (i) any of the Seller Parties, (ii) any Affiliates or Representatives of the foregoing, or (iii) any other Person bound by a duty of confidentiality to Purchaser or its Affiliates; or (iv) to the extent such disclosure is expressly required or permitted by the provisions of the Purchase Agreement or Transition Services Agreement.

12

 

(b)If any Seller Party, or any of their respective Affiliates or Representatives is required, in the opinion of the his/its counsel to disclose any Confidential Information by law, regulation or legal or regulatory process, the Seller Parties, respectively, shall: (i) take all reasonable steps (at Purchaser’s sole cost and expense) to preserve the privileged nature and confidentiality of the Confidential Information, including requesting that the Confidential Information not be disclosed to non-parties or the public; (ii) give Purchaser prompt prior written notice of such request or requirement so that Purchaser may seek, at its sole cost and expense, an appropriate protective order or other remedy; and (iii) cooperate with Purchaser (at Purchaser’s sole cost and expense) to obtain such protective order or other remedy.  In the event that such protective order or other remedy is not obtained, the Seller Parties (or such other Persons to whom such request is directed) may furnish that portion (and only that portion) of the Confidential Information which, on the advice of the Seller Parties’ counsel, is legally required to be disclosed and, upon Purchaser’s request, use such Person’s best efforts to obtain assurances that confidential treatment will be accorded to such information.

(c)Except as expressly permitted in Part B of this Agreement, the Seller Parties shall not (and shall not permit any of their respective controlled Affiliates or Representatives to) use, directly or indirectly, any Confidential Information for such Person’s own account or for the benefit of any third party.

(d)Each of the Seller Parties shall use reasonable care, at least as protective as the efforts it uses with respect to its own Confidential Information, to safeguard Purchaser’s Confidential Information from use or disclosure other than as permitted hereby.  All Trade Secret information, and each individual item of Trade Secret information, shall be safeguarded by the Sellers Parties as required by this Agreement in perpetuity or until such time as such information no longer remains a Trade Secret under applicable law, whichever occurs first, at which time such information shall be considered Proprietary Information.  All Proprietary Information, and each individual item of Proprietary Information, shall be safeguarded by the Seller Parties as required by this Agreement for a period of five (5) years from the date hereof, or until such time the Seller Party no longer has its obligation set forth in Section 13(a), with respect to such Proprietary Information, whichever occurs first.

Section 14.Term.  The “Term” of this Agreement shall commence on the Effective Date and shall continue in perpetuity.

Section 15.Binding Nature.  Except as otherwise provided in this Agreement or as otherwise required by law, this Agreement is binding upon and inures to the benefit of the Parties and their respective successors, personal representatives, heirs, devisees, guardians and assigns.

Section 16.Remedies.  In addition to their right to damages, the Parties shall have the right to obtain temporary and permanent injunctive relief and any other equitable relief (in each case without the necessity of posting any bond or other security therefor) to restrain or prevent any breach or threatened breach of this Agreement or otherwise to specifically enforce the terms of this Agreement.  The rights and remedies of the Parties hereunder are cumulative and not alternative.  

13

 

Section 17.Assignment.  Neither Party may assign this Agreement or any part thereof other than (i) to an Affiliate, (ii) to an entity that purchases or takes a security interest in all, or substantially all of the assets of such assignor, or with whom such assignor merges where the assignor is not the surviving party, (iii) in a restructuring in which the beneficial holders of at least fifty percent (50%) of the voting equity following such assignment are the same as prior to the assignment; in each case so long as the assignee agrees in writing to be bound by the terms of this Agreement, and (iv) with the written consent of the other Party.  For purposes of this provision, a change of control of a Party pursuant to purchase and sale of a Party’s equity (including the equity of any person that Controls such Party), or any other event pursuant to which the ability to control the operations of such Party changes, shall not be considered an assignment.

Section 18.No Third-Party Beneficiaries.  This Agreement is for the sole benefit of the Parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.  

Section 19.Notice.  All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been given (i) when delivered by hand (with written confirmation of receipt); (ii) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (iii) on the date sent by electronic mail of a PDF document (and with the sender thereof not receiving a bounce back or undeliverable notification) if sent during normal business hours of the recipient, and on the next Business Day if sent after normal business hours of the recipient or (iv) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid.  Such communications must be sent to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 19):

 

	
If to Seller:

 
	
Mercury Notifications, Inc.

 1 Crossways Park Drive W 

Woodbury, NY 11797

Attention: Jonathan Leonard (jsleonard@mercuryn.com)

	
with a copy to (which shall not

constitute notice):

 
	
Zuber Lawler & Del Duca LLP

350 South Grand Avenue, 32nd Floor

Los Angeles, CA 90071

Attention: Josh Lawler (jlawler@zuberlawler.com)

	
If to Purchaser:

 
	
EMMIS QOZ BUSINESS, LLC

40 Monument Circle

Indianapolis, IN 46204

Attention: Legal Department (legal@emmis.com)

	
with a copy to (which shall not

constitute notice):
	
Taft Stettinius & Hollister LLP 

One Indiana Square, Suite 3500

Indianapolis, IN 46204

Attention: Brad Schwer (bschwer@taftlaw.com)

14

 

 

Section 20.Compliance.  Purchaser and Seller shall each comply with the provisions of all applicable federal, state, and local laws, ordinances, regulations and codes (including procurement of required permits or certificates) in fulfilment of their obligations under this Agreement.  All Intellectual Property licensed pursuant to this Agreement is subject to U.S.  export and foreign transactions control regulations.  Each Party agrees to comply with all applicable U.S. export control laws and regulations, specifically including the requirements of the Arms Export Control Act, 22 U.S.C.  2751-2794, including the International Traffic in Arms Regulation (ITAR), 22 C. F R. 120 et seq.; and the Export Administration Act, 50 U.S.C. app. 2401-2420, including the Export Administration Regulations, 15 C.F.R. 730-774; including the requirement for obtaining any export license or agreement, if applicable.  Without limiting the foregoing, each Party agrees that it will not transfer any information it receives from the other Party that constitutes an export of controlled items, data, or services, to include transfer to foreign persons employed by or associated with, or under contract to such Party or their suppliers, without the authority of an export license, agreement, or applicable exemption or exception.

Section 21.Amendment and Modification.  This Agreement may be amended by the Parties only by execution of an instrument in writing signed by Purchaser and the Seller.  

Section 22.No Waiver.  Neither the failure nor any delay by any Person in exercising any right, power or privilege under this Agreement will operate as a waiver of such right, power or privilege, and no single or partial exercise of any such right, power or privilege will preclude any other or further exercise of such right, power or privilege or the exercise of any other right, power or privilege.  No waiver of a right, power or privilege under this Agreement shall be valid or enforceable unless in writing and signed by the Person holding such right, power and privilege and then such waiver shall only be applicable to the specific instance in which it is given.

Section 23.Governing Law.  This Agreement, and all matters arising out of or relating to this Agreement, shall be governed by and construed in accordance with the internal laws of the State of New York without giving effect to any choice or conflict of law provision or rule (whether of the State of New York or any other jurisdiction) that would cause the application of laws of any jurisdiction other than those of the State of New York.

Section 24.Submission to Jurisdiction.  Any legal suit, action or proceeding arising out of, based upon or in any way relating to this Agreement shall be instituted in the federal courts of the United States of America or the courts of the State of New York in each case located in Nassau County, and each Party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding.  The Parties irrevocably and unconditionally waive any objection to the laying of venue of any suit, action or proceeding in such courts and irrevocably waive and agree not to plead or claim in any such court that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

15

 

Section 25.Waiver of Jury Trial.  Each of the Parties to this Agreement acknowledges and agrees that any controversy which may arise under this Agreement is likely to involve complicated and difficult issues and, therefore, each such Party hereby irrevocably and unconditionally waives any right such Party may have to a trial by jury in respect of any legal action arising out of or relating to this Agreement.  Each Party to this Agreement hereby certifies and acknowledges that: (a)no Representative of any other Party has represented, expressly or otherwise, that such other Party would not seek to enforce the foregoing waiver in the event of a legal action; (b)such Party has considered the implications of this waiver; (c)such Party makes this waiver voluntarily; and (d)such Party has been induced to enter into this Agreement by, among other things, the mutual waivers and certifications in this Section 25.

Section 26.Severability.  Whenever possible each provision and term of this Agreement will be interpreted in a manner to be effective and valid but if any provision or term of this Agreement is held to be prohibited by applicable law or invalid, then such provision or term will be ineffective only to the extent of such prohibition or invalidity, without invalidating or affecting in any manner whatsoever the remainder of such provision or term or the remaining provisions or terms of this Agreement.  If any of the covenants set forth in Sections 3, 4 or 5 of this Agreement are held to be unreasonable, arbitrary or against public policy, such covenants will be considered divisible with respect to scope, time and geographic area, and in such lesser scope, time and geographic area, will be effective, binding and enforceable against the Seller Parties to the greatest extent permissible.

Section 27.Extension and Termination of Covenants.  In the event of a material breach by the Seller Parties (or any of their respective Affiliates) of any covenant set forth in Sections 3, 4 or 5 of this Agreement, in respect of which such Seller Party does not provide reasonable cure following written notice from Purchaser, the term of such covenant will be extended by the period of the duration of such breach.  

Section 28.Entire Agreement.  This Agreement (including its Appendices and Exhibits), constitutes the sole, entire and integrated agreement of the Parties to this Agreement with respect to the subject matter contained herein, and supersedes all prior and contemporaneous understandings, agreements, representations and warranties, both written and oral, with respect to such subject matter. As of the date hereof, there are no agreements, arrangements or understandings, whether oral or written, between the Parties relating to the subject matter of this Agreement that are not set forth or expressly referred to herein.

Section 29.Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement.  A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

Section 30.Relationship of the Parties.  No Party shall, as a result of this Agreement, have any authority to act for or on behalf of or to bind another Party in any fashion.

16

 

Section 31.Bankruptcy.  All rights and licenses granted by a Party to the other under this Agreement are and shall be deemed to be rights and licenses to “intellectual property” as such term is used in, and interpreted under, Section 365(n) of the United States Bankruptcy Code (the “Bankruptcy Code”) (11 U.S.C. § 365(n)).  Each Party shall have all rights, elections, and protections under the Bankruptcy Code and all other bankruptcy, insolvency, and similar laws with respect to the Agreement, and the subject matter hereof.  Without limiting the generality of the foregoing, each Party acknowledges and agrees that, if the other Party or its estate becomes subject to any bankruptcy or similar proceeding:

(a)subject to such Party’s rights of election under Section 365(n), all rights, licenses, and privileges granted to a Party under this Agreement will continue subject to the respective terms and conditions hereof, and will not be affected, even by such Party’s rejection of this Agreement; and

(b)such Party shall be entitled to a complete duplicate of, or complete access to, as appropriate, all such intellectual property and embodiments of intellectual property, which, if not already in such Party’s possession, shall be promptly delivered to such Party, or its designee, unless such Party elects to and does in fact continue to perform all of its obligations under this Agreement.

Section 32.Construction.  The headings of sections to this Agreement are provided for convenience only and will not affect the construction or interpretation hereof. All personal pronouns used in this Agreement, whether used in the masculine, feminine or neuter gender, include all other genders.  The singular includes the plural and vice versa.  This Agreement has been jointly drafted by the Parties and shall not be construed against either Party.  The word “including” and words of similar import when used in this Agreement shall mean “including without limitation,” unless otherwise specified.

26858959

[Signature page follows.]

17

 

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

 

	
Emmis QOZ Business, LLC

	
By:
	
/s/ J. Scott Enright

	
Printed:
	
J. Scott Enright

	
Title:
	
Executive Vice President

 

	
Lenore Acoustics Corporation

	
By:
	
/s/ Jonathan S. Leonard

	
Printed:
	
Jonathan S. Leonard

	
Title:
	
Authorized Officer

 

	
Mercury Notifications, LLC

	
By:
	
/s/ Jonathan S. Leonard

	
Printed:
	
Jonathan S. Leonard

	
Title:
	
Authorized Officer

 

	
 
	
/s/ Jonathan S. Leonard

	
 
	
Jonathan S. Leonard

 

 

 

[Signature Page to Restrictive Covenant and Technology Cross License Agreement]

 

EXHIBIT A

 

Territory of Restriction

 

	
 
	
1.
	
Bermuda

	
 
	
2.
	
Brazil

	
 
	
3.
	
Canada

	
 
	
4.
	
Colombia

	
 
	
5.
	
Costa Rica

	
 
	
6.
	
India

	
 
	
7.
	
Malaysia

	
 
	
8.
	
Mexico

	
 
	
9.
	
Netherlands

	
 
	
10.
	
Panama

	
 
	
11.
	
Philippines

	
 
	
12.
	
United Kingdom

	
 
	
13.
	
United States of America

19

 

APPENDIX A

Combination Mass Notification and Sound Masking Systems

Existing Customers

American Family Mutual Insurance Company S.I.

Digi-Key/ Digi-Key Electronics

Ford Motor Company/ Ford Land/Ford VPEC

Mayo Clinic

Seagate

Sentry Insurance

Sentry World

Stoughton Hospital

Tenet Healthcare

Georgia Pacific - Wisconsin

Authorized Customers (including scope of work quoted)

Landmark Credit

Rush Medical 

UW Health

Sisters of Sorrowful Mothers

HPE 

 

20emms-ex103_8.htm

Exhibit 10.3

TRANSITION SERVICES AGREEMENT

THIS TRANSITION SERVICES AGREEMENT (this “Agreement”) is made and entered into this 10th day of March 2020 (the “Effective Date”), by and between Emmis QOZ Business, LLC, an Indiana limited liability company (“EQOZB”), and Lencore Acoustics Corporation, a New York corporation (“Lencore” and, together with EQOZB, the “Parties”).  Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to such terms in the Purchase Agreement (as hereinafter defined).  

WHEREAS, in connection with an Asset Purchase Agreement, dated as of the date hereof (the “Purchase Agreement”), the Company’s Business and the Acquired Assets were sold to EQOZB; and

WHEREAS, in furtherance of such separation, Lencore and EQOZB desire to minimize the sharing of resources and other like interactions between the n.FORM Business and the Company’s Business, except where it will be materially detrimental to the n.FORM Business or the Company’s Business not to share expenses, employees or other resources for a period of time following the Closing; 

WHEREAS, among other things, EQOZB desires to lease from Lencore certain of Lencore’s existing personnel who are employees of Lencore pursuant to the terms and conditions of this Agreement; and

WHEREAS, the Parties desire to provide each other with certain Transition Services (as hereinafter defined).

NOW, THEREFORE, the Parties, intending to be legally bound, agree as follows:

	
Section 1.
	
Transition Services.

(a)Provision of Transition Services.  

(i)Lencore shall provide or cause to be provided at no cost to EQOZB (except as set forth on Exhibit A hereto) certain services described on Exhibit A, and such other services as EQOZB may reasonably request in order to operate the Company’s Business in the ordinary course as historically conducted, including, but not limited to, providing services, information, data, and assistance related to financial, technology, and vendor relations during the Transition Period (hereinafter defined), in connection with the transition of the Company’s Business (such services, collectively, the “Lencore Transition Services”).

(ii)EQOZB shall provide or cause to be provided at no cost to Lencore (except as set forth on Exhibit B hereto) certain services described on Exhibit B, and such other services as Lencore may reasonably request in order to operate the n.Form Business in the ordinary course as historically conducted, including, but not limited to, providing services, information, data, and assistance related to financial, technology, vendor relations, and customer relations during the Transition Period, in connection with the transition of the n.Form Business (such services, collectively, the “EQOZB Transition Services” and, together with the Lencore Transition Services, the “Transition Services”).

 

	
2538-1004 / 1564093.6
	
1
	
 

 

 

(iii)The Transition Services are in addition to and not in lieu of either Party’s respective obligations under the Purchase Agreement.  

(b)Disclaimer of Warranties.  EXCEPT AS SET FORTH IN SECTION 1(C), NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY OF ANY NATURE OR KIND (WHETHER EXPRESS OR IMPLIED), INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER MATTER WHATSOEVER.  EACH PARTY ACKNOWLEDGES AND AGREES THAT THE OTHER PARTY HAS NOT ASSUMED AN ADVISORY OR FIDUCIARY RESPONSIBILITY IN FAVOR OF SUCH PARTY OR ITS AFFILIATES WITH RESPECT TO PROVIDING THE TRANSITION SERVICES HEREUNDER OR ANY OTHER OBLIGATION TO SUCH PARTY OR ITS AFFILIATES.  EACH PARTY AGREES THAT IT WILL NOT CLAIM THAT THE OTHER PARTY HAS RENDERED ADVISORY, CONSULTING OR LEGAL SERVICES OR HAS PROVIDED BUSINESS ADVICE OF ANY NATURE OR RESPECT, OR OWES ANY DUTY, FIDUCIARY OR OTHERWISE, TO SUCH PARTY IN CONNECTION HEREWITH.

(c)Level of Service.  Each Party shall provide the Transition Services in a commercially reasonable manner and shall assign sufficient resources and qualified personnel as are reasonably required to perform the Transition Services in a commercially reasonable manner.

(d)Communications.  The Parties shall exercise commercially reasonable good faith efforts to facilitate communications in furtherance of the provision and receipt of the Transition Services.  Each Party agrees to promptly assign a representative to act as a point person and primary channel of communication with the other Party. 

	
Section 2.
	
Employee Leasing.

(a)Lease of Employees.  From the Effective Date through April 30, 2020 (the “Leasing Term”), EQOZB shall lease from Lencore the employees set forth in Section 3.18(a) of the Disclosure Schedules to the Purchase Agreement (such employees, together with any replacement employees and any other subsequently hired employees to which EQOZB has consented, the “Leased Employees”) to perform such services for EQOZB as are reasonably requested by, and at the direction of, EQOZB (the “EQOZB Services”).  Leased Employees shall exclusively dedicate their full time and attention to the EQOZB Services and shall deliver the EQOZB Services consistent with each Leased Employee’s past practice.

(b)Reimbursement.  

(i)During the Leasing Term, EQOZB shall promptly reimburse Lencore for all costs and expense directly attributable to the Leased Employees for their performance of the EQOZB Services in an amount equal to Lencore’s actual out-of-pocket cost incurred in connection with the provision of the EQOZB Services by the Leased Employees, which reimbursement shall include without 

 

	
2538-1004 / 1564093.6
	
2
	
 

 

 

limitation the Leased Employees’ salary and/or hourly wages earned for the performance of the EQOZB Services, and Lencore’s actual out-of-pocket cost incurred in connection with benefits, workers’ compensation expenses, unemployment compensation expenses, severance expenses, and the employer portion of premiums and administrative fees under all benefits provided (including health coverage, life insurance coverage and long-term disability coverage), the employer portion of employment taxes, and other expense reimbursement (including out-of-pocket expenses attributable to claims involving Leased Employees, unless the allegations relate primarily to the conduct of employees of Lencore or any Affiliate thereof who are not Leased Employees, but solely with respect to conduct that occurred during the Leasing Term and is not subject to indemnity by Lencore under Section 2(e)(iii)), all such amounts to be scheduled in advance to the extent practicable.  For the avoidance of doubt, Lencore shall not be entitled to receive from EQOZB reimbursement for (i) any wages, benefits costs or expenses of Lencore employees who are not Leased Employees, (ii) any out-of-pocket expenses incurred by Lencore in the conduct of those portions of Lencore’s business that are not related to EQOZB, or (iii) any payments or benefits triggered by or otherwise relating to the transactions contemplated by this Agreement, but shall be entitled to reimbursement for any out-of-pocket costs incurred by Lencore with respect to Leased Employees that are incremental to the costs and expenses Lencore would otherwise incur with respect to its employees who are not Leased Employees (e.g., pro rata share of health and employer’s liability insurance).

(ii) With respect to payroll, Lencore shall invoice EQOZB on the second Business Day before the date bi-weekly payroll is drawn from Lencore’s bank account and EQOZB shall wire such amount to Lencore before the end of the following day.  With respect to other employee costs during the Leasing Term, including but not limited to health care costs, Lencore shall invoice EQOZB on the first Business Day of the month for the amounts incurred with respect to the Leased Employees in the prior month(s), and EQOZB shall pay such amount to Lencore on or before the tenth day of the same month, provided that EQOZB agrees with the amounts listed on the invoice.  In providing each invoice, Lencore shall provide EQOZB with sufficient information about the amounts listed in the invoice and, upon EQOZB’s request, Lencore shall provide EQOZB with such additional information as is reasonably necessary for EQOZB to verify the accuracy of any such invoice.  

(iii) EQOZB agrees to pay interest to Lencore for any past due amounts that are not disputed by EQOZB in good faith at the lesser of the highest rate allowable by Law or twelve percent (12%) per annum from the due date until such amounts are paid.  In addition, EQOZB shall promptly reimburse Lencore for all reasonable costs incurred in collecting any past due amounts, including but not limited to reasonable attorneys’ fees and expenses.  This section shall not limit or waive any other legal and equitable rights and remedies Lencore shall have under this Agreement for a delinquent payment.

 

	
2538-1004 / 1564093.6
	
3
	
 

 

 

(c) Lencore’s Responsibilities.

(i) Employment of Leased Employees.  During the Leasing Term, all Leased Employees shall at all times remain employees of Lencore and on the direct payroll of Lencore.  Lencore shall maintain complete employment files for each Leased Employee in accordance with all applicable Laws.  Lencore is solely responsible for supervising, performance managing, promoting, disciplining, and/or terminating the Leased Employees; provided, that EQOZB may at its discretion (but subject to ADP’s termination policies) provide input to Lencore as to the management, promotion, discipline and termination of any Leased Employee.  Lencore will provide EQOZB with all information relating to the Leased Employees or their employment as reasonably requested by EQOZB, and will otherwise reasonably cooperate with EQOZB in relation to the Leased Employees and their employment.  EQOZB will defend, indemnify and hold harmless with respect to any claim by an employee who was terminated or disciplined at the request, or on instructions, of EQOZB.

(ii) Compliance with Laws.  Lencore shall use its commercially reasonable efforts to comply with all applicable Laws governing its employment of the Leased Employees and the Leased Employees’ performance of the EQOZB Services.  Lencore shall use commercially reasonable efforts to comply with all applicable Laws regarding the legal status of each Leased Employee to work and reside in the United States.

(iii) Taxes.  During the Leasing Term and subject to Lencore’s reimbursement rights under Section 2(b), Lencore shall be solely responsible for the payment of all federal, state and local employment taxes and withholdings for each Leased Employee, including income taxes, FICA and unemployment insurance taxes.  Lencore shall also properly file all information and tax returns and issue all wage and tax statements related to any compensation paid to Leased Employees during the Leasing Term.

(iv) Workers’ Compensation and Unemployment Compensation.  During the Leasing Term and subject to EQOZB’s reimbursement obligation under Section 2(b), Lencore shall be responsible for (i) maintaining valid workers’ compensation insurance for the Leased Employees, and (ii) all unemployment compensation claims filed by any Leased Employee; provided, however, that any and all out-of-pocket expenses associated with the foregoing shall be paid by EQOZB to Lencore consistent with Section 2(b).

(v) Employee Benefits.  During the Leasing Term, Lencore shall be solely responsible for maintaining employee benefit plans for the Leased Employees consistent with those provided to such Leased Employees prior to the Closing Date; provided, that Lencore shall not make any changes to or enter into any employee benefit plans (including employment or severance agreements) covering the Leased Employees that would materially increase the cost to EQOZB without EQOZB’s prior written consent.

 

	
2538-1004 / 1564093.6
	
4
	
 

 

 

(vi)Severance.  To the extent that, during the Leasing Term, EQOZB instructs Lencore to terminate any Leased Employee and Lencore and EQOZB determine that the terminated Leased Employee shall be paid severance, Lencore shall pay such severance as agreed upon between Lencore and EQOZB; provided, that in all cases Lencore shall condition any severance on a release that, includes, among other terms, a release of any claims against EQOZB and its Affiliates.

(d)Employment Following the Leasing Term.  Prior to the expiration or earlier termination of the Leasing Term, Emmis Operating Company, an Indiana corporation (“Emmis OpCo”), shall offer employment to all of the Leased Employees who are employed by Lencore at the termination of the Leasing Term as set forth in Section 6.3(a) of the Purchase Agreement (all such Leased Employees to whom employment is offered, collectively, the “Continuing Employees”).  Provided that Emmis OpCo makes and honors the offer of employment required by this Section 2(d), Emmis OpCo shall not be responsible for, and Lencore hereby agrees to indemnify defend and hold harmless Emmis OpCo and its Affiliates (including EQOZB) from, any Losses relating to any Leased Employee that does not become a Continuing Employee by reason of declining an offer of employment pursuant to this Section 2(d), including any severance or termination liabilities or costs relating to such Leased Employee.

(e)Limitation of Liability and Indemnity.

(i)None of Lencore, its Affiliates or any officer, director, employee, partner, manager or other agent of Lencore or its Affiliates will have any liability to EQOZB hereunder for any action under Section 2 of this Agreement unless such conduct is not taken in accordance with the standards of conduct for corporate directors and officers under New York law (taking into account Lencore’s obligations under this Agreement), and the failure to meet that standard has been judicially determined to have constituted fraud, recklessness or willful misconduct.  

(ii)EQOZB hereby agrees to indemnify defend and hold harmless Lencore and its Affiliates and any of their respective current or former officers, directors, employees, partners, managers or other agents (individually and collectively, “Lencore Indemnified Person”) from any and all loss, liability, cost and expense including but not limited to reasonable attorneys’ fees and expenses incurred by the Lencore Indemnified Person in connection with, arising from or related to the performance by it of its obligations hereunder or otherwise related to EQOZB, except if such loss, liability cost or expense results from the fraudulent, reckless or willful misconduct of Lencore; provided, however, that no Lencore Indemnified Person shall be entitled to indemnification for any withdrawal liability incurred by Lencore or its ERISA Affiliates under ERISA (including any contingent or secondary liability) to any Multiemployer Plan.  EQOZB will reimburse each Lencore Indemnified Person for the reasonable out-of-pocket costs and expenses (including attorneys’ fees and expenses) of investigating, preparing for and responding to any actual or threatened action, claim, suit, investigation or proceeding or enforcing this Agreement, as they are incurred; provided that Lencore shall promptly reimburse EQOZB for any amounts advanced to the extent that a court of competent jurisdiction determines that an Lencore Indemnified Person acted recklessly, or engaged in willful misconduct.

 

	
2538-1004 / 1564093.6
	
5
	
 

 

 

(iii)Lencore hereby agrees to indemnify defend and hold harmless EQOZB and its Affiliates and any of their respective current or former officers, directors, employees, partners, managers or other agents (individually and collectively, “EQOZB Indemnified Person”) (A) from any and all loss, liability, cost and expense including but not limited to reasonable attorneys’ fees and expenses incurred by the EQOZB Indemnified Person in connection with Lencore’s failure to comply with the standard of conduct set forth in Section 2(e)(i), except if such loss, liability cost or expense results from the fraudulent, reckless or willful misconduct of EQOZB, and (B) from any withdrawal liability incurred by EQOZB or its Affiliates under ERISA (including any contingent, secondary or successor liability) to any Multiemployer Plan to the extent based on the contribution histories of Lencore and its ERISA Affiliates (as opposed to any contributions made after the end of the Term by EQOZB and its ERISA Affiliates).  Lencore will reimburse each EQOZB Indemnified Person for the reasonable out-of-pocket costs and expenses (including attorneys’ fees and expenses) of investigating, preparing for and responding to any actual or threatened action, claim, suit, investigation or proceeding relating to Lencore’s violation of the standard of conduct set forth in Section 2(e)(i), as they are incurred; provided that EQOZB shall promptly reimburse Lencore for any amounts advanced to the extent that a court of competent jurisdiction determines that an EQOZB Indemnified Person acted recklessly, or engaged in willful misconduct.

	
Section 3.
	
Term and Termination.

(a)Term.  Unless terminated sooner by mutual written agreement or consent of the Parties, this Agreement shall commence on the Closing Date, and shall terminate with respect to the Transition Services on the date that is nine (9) months after the Closing Date (the “Transition Period”).

(b)Survival.  The Parties acknowledge and agree that Section 1(b), Section 2(e), 3, Section 54, Section 6 and Section 6 shall survive the expiration or termination of this Agreement.

(c)Mutual Cooperation and Additional Assumptions.  Prior to the termination of this Agreement, the Parties shall reasonably cooperate in good faith to facilitate an orderly transition of responsibility for the Transition Services, and each Party shall deliver to the other Party copies of such documents, records and information as are reasonably necessary to achieve such transition.   

	
Section 4.
	
Confidential Information.  

(a)Definition.  In connection with this Agreement, each Party has disclosed and may continue to disclose to the other Party information that relates to the disclosing Party’s business operations, financial condition, customers, products, services or technical knowledge.  Except as may otherwise be specifically agreed in writing by the Parties, each Party agrees that (i) all information communicated to it by the other and identified as confidential or proprietary, whether before or after the Effective Date; (ii) all information 

 

	
2538-1004 / 1564093.6
	
6
	
 

 

 

identified as confidential or proprietary to which it has access in connection with this Agreement, whether before or after the Effective Date; (iii) all information communicated to it that should have been understood by the receiving Party, because of confidentiality or similar legends, the circumstances of disclosure or the nature of the information itself, to be proprietary and confidential to the disclosing Party; and (iv) the terms and conditions of this Agreement (collectively, the “Confidential Information”), shall be and shall be deemed to have been received in confidence and shall be used only for purposes of this Agreement in compliance with applicable Law.  

(b)Confidentiality.  Each Party’s Confidential Information shall remain the property of that Party except as may otherwise be expressly provided in this Agreement.  Each Party shall use at least the same degree of care it uses to protect its own Confidential Information in order to safeguard and prevent disclosing to third parties the Confidential Information of the other Party and, in any event, no less than reasonable care.  Each Party shall not (i) make any use or copies of the Confidential Information of the other Party except as contemplated by this Agreement; (ii) acquire any right in or assert any lien against the Confidential Information of the other; or (iii) sell, assign, lease or otherwise commercially exploit the Confidential Information or any derivative works of the other Party.  Neither Party may withhold the Confidential Information of the other Party or refuse for any reason, including due to the other Party’s actual or alleged breach of this Agreement, to promptly return to the other Party its Confidential Information, including copies, if requested to do so.  

(c)Exclusions.  This Section 4 shall not apply to any particular information that either Party can demonstrate (i) was, at the time of disclosure to it, in the public domain; (ii) was, after disclosure to it, published or otherwise becomes part of the public domain through no fault of the receiving Party; (iii) was in the possession of the receiving Party at the time of disclosure to it and was not the subject of a pre-existing confidentiality obligation; (iv) was received after disclosure to it from a third party who had a lawful right to disclose such information to it; (v) was independently developed by the receiving Party without use of the Confidential Information of the disclosing Party as evidenced by the receiving Party’s own records; or (vi) was required to satisfy any legal requirement of a competent governmental authority (including any disclosure required under applicable stock exchange rules); provided that such Party promptly, upon receiving any such request and prior to making the disclosure, advised the other Party (but only to the extent not prohibited by such legal requirement) and took reasonable action to ensure confidential treatment of the Confidential Information.  

	
Section 5.
	
Ownership.  Each Party retains all right, title and interest (including all patents, copyrights, trade secrets, trademarks or other intellectual property rights) in their respective pre-existing materials (and any materials developed by such Party) that it provides to the other Party, and this Agreement does not grant any rights or licenses except as expressly set forth herein, and no other right or license is to be implied by or inferred from any provision of this Agreement or by the conduct of the Parties.  Notwithstanding the foregoing, any and all intellectual property that is part of the Acquired Assets shall in all cases be and remain owned by EQOZB.  This Agreement shall not be construed in any manner as a grant from one Party to the other Party of any rights held by any third party.  

 

	
2538-1004 / 1564093.6
	
7
	
 

 

 

	
Section 6.
	
Miscellaneous.

(a)Limitation of Liability.  Neither Party shall be liable to the other for monetary damages for any losses, claims, damages, or liabilities arising from any act or omission taken or omitted hereunder to the extent such act or omission was taken in good faith, was not attributable to such Party’s material breach of this Agreement, and did not constitute fraud, willful misconduct, or recklessness.  Notwithstanding any other provision herein, in no event shall either Party have any liability to the other hereunder for any lost profits or consequential, punitive, special or indirect damages in connection with the performance or nonperformance of this Agreement (whether resulting from negligence or otherwise).

(b)No Agency.  Nothing contained in this Agreement shall constitute or be deemed to constitute a partnership, or create or be deemed to create any relationship among the Parties other than as parties hereto.  No Party hereto is authorized or empowered to act as an agent for or otherwise bind or commit any other Party hereto, and each Party agrees not to enter into any contract or agreement or make any commitment, representation or warranty that purports to bind any other Party hereto or otherwise act in the name of or on behalf of any other Party hereto, without the written consent of such other Party. 

(c)Notices.  Any notice, request or demand desired or required to be given hereunder shall be in writing given by personal delivery, confirmed e-mail or overnight courier service, in each case addressed as respectively set forth below such Party’s signature block or to such other address as any Party shall have previously designated by such a notice.  The effective date of any notice, request or demand shall be the date of personal delivery, the date on which successful e-mail transmission is confirmed, or the date actually delivered by a reputable overnight courier service, as the case may be, in each case properly addressed as provided herein and with all charges prepaid.

(d)Successors and Assigns.  This Agreement and the rights and obligations of the Parties hereunder shall bind and inure to the benefit of the respective heirs, successors and assigns of the Parties, except that neither this Agreement nor any of the rights or obligations hereunder may be assigned or delegated by either Party without the prior written consent of the other Party.  

(e)Waiver of Rights.  The failure of EQOZB or Lencore to assert any right or remedy upon the breach of any provision of this Agreement shall not be deemed to be a waiver of any present or future right hereunder, unless said waiver is made in writing and signed by the Party against whom enforcement is sought.

(f)Severability of Agreement.  In the event any clause, provision or paragraph of this Agreement is held to be illegal, invalid or unenforceable by any court of competent jurisdiction, such clause, provision or paragraph shall be deemed severed from the Agreement and shall not affect the validity of the remaining provisions of this Agreement.

(g)Law To Govern.  This Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of New York without giving effect to the principles of conflicts of law thereof.

 

	
2538-1004 / 1564093.6
	
8
	
 

 

 

(h)ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT, OR THE TRANSITION SERVICES MAY BE INSTITUTED IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF NEW YORK, IN EACH CASE LOCATED IN NASSAU COUNTY, AND EACH PARTY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING.  SERVICE OF PROCESS, SUMMONS, NOTICE OR OTHER DOCUMENT BY MAIL TO SUCH PARTY’S ADDRESS SET FORTH HEREIN SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT IN ANY SUCH COURT.  THE PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR ANY PROCEEDING IN SUCH COURTS AND IRREVOCABLY WAIVE AND AGREE NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

(i)EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSITION SERVICES.  EACH PARTY TO THIS AGREEMENT CERTIFIES AND ACKNOWLEDGES THAT (1) NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT SEEK TO ENFORCE THE FOREGOING WAIVER IN THE EVENT OF A LEGAL ACTION, (2) SUCH PARTY HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (3) SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (4) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS Section 6(i).

(j)Entire Agreement; Amendments.  This Agreement, together with the exhibits, schedules and written agreements ancillary hereto (including, without limitation, the Purchase Agreement and each of the other Transaction Documents referenced therein), contains the entire understanding of the Parties with respect to the subject matter hereof and supersedes all previous oral and written communications, agreements and understandings between the Parties with respect to the subject matter herein.  No change, modification or amendment of this Agreement shall be binding unless made in writing and signed by authorized representatives of both Parties.  

(k)Counterparts; Facsimile.  This Agreement may be executed in one or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument.  This Agreement may be executed and delivered by facsimile or other electronic transmission, and a facsimile or electronic copy of this Agreement or of a signature of a Party will be effective as an original.

 

	
2538-1004 / 1564093.6
	
9
	
 

 

 

(l)Expenses.  Except as otherwise specified in this Agreement, each Party to this Agreement will pay its own legal, accounting, out-of-pocket and other expenses incident to this Agreement and to any action taken by such Party in preparation for carrying this Agreement into effect.  

[SIGNATURE PAGE FOLLOWS]

 

 

	
2538-1004 / 1564093.6
	
10
	
 

 

(Signature Page to Transition Services Agreement)

 

IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be duly executed on its behalf by its duly authorized officer as of the date first written above.

 

 

	
 
	
EQOZB:

	
 
	
 
	
 

	
 
	
EMMIS QOZ BUSINESS, LLC

	
 
	
 
	
 
	
 

	
 
	
By:
	
/s/ J. Scott Enright

	
 
	
 
	
Name:
	
J. Scott Enright

	
 
	
 
	
Title:
	
Executive Vice President

	
 
	
Address:
	
40 Monument Circle, Suite 700, Indianapolis, IN 46204

	
 
	
 

	
 
	
LENCORE:

	
 
	
 
	
 

	
 
	
LENCORE ACOUSTICS CORPORATION

	
 
	
 
	
 
	
 

	
 
	
By:
	
/s/ Jonathan S. Leonard

	
 
	
 
	
Name:
	
Jonathan S. Leonard

	
 
	
 
	
Title:
	
Authorized Officer

	
 
	
Address:
	
1 Crossways Park Drive W. Woodbury, NY 11797

 

2538-1004 / 1564093.6 

 

Exhibit A

 

LENCORE TRANSITION SERVICES

 

1.Consents.  Lencore will use commercially reasonable efforts to obtain and deliver to EQOZB, within a reasonable period of time, the consent of the counterparties to the assignment to EQOZB of the agreements set forth on Section 3.3(b) of the Disclosure Schedules.

 

2.ETL / UL.  Lencore will use commercially reasonable efforts to obtain and deliver to EQOZB, within thirty (30) days following the Closing Date, the transfers of applications and test results of Underwriters Laboratories and Electrical Testing Laboratories with respect to the Sound Masking Systems used in the Company’s Business and/or included in the Acquired Assets. 

3.Procurement / Inventory.  Lencore to assist EQOZB with hand-off to EEQOZB of existing materials vendors for all raw materials, including vendor names, price lists, PCBs, BOMS, drawings, Gerbers, cans, speakers, head-end components, R&D materials. 

 

Lencore to establish its own relationships with vendors as soon as practicable.

 

4.Order Processing (LOOP).  Processing of customer purchase orders, transmission of orders to plant, verification of delivery information, verification of installation and tuning services to be handed off to Lencore or EQOZB resource, as appropriate.

5.Mail & Notices.  EQOZB and Lencore will cooperate in forwarding mail that ought to have been addressed to the other, or that needs to be dealt with by the other.

6.Office Premises.  Lencore will provide office space and basic office furniture (but not office supplies or inventory) for EQOZB, consisting of the top floor of the 1 Crossways Park Drive West building (the “Premises”), for a period of six (6) months, with up to six (6) one-month extensions at the reasonable request of EQOZB, notwithstanding the earlier expiration of the Transition Period.  EQOZB shall not make any alterations to the Premises without the advance written consent of Lencore, which may be granted or withheld in Lencore’s sole discretion.  Only the Leased Employees, and those other employees, agents, and invitees of EQOZB who have been approved by Lencore in writing in advance (collectively, the “EQOZB Personnel”) will be permitted into the Premises, such approval not to be unreasonably withheld, conditioned or delayed.  EQOZB and EQOZB Personnel shall comply with all rules, regulations, and procedures established by Lencore and/or Ship 142, LLC (the “Prime Landlord”), in effect as of the Effective Date.

 

This Agreement is expressly subordinate to the Commercial Lease Agreement, dated as of August 21, 2019, between Lencore and the Prime Landlord (the “Prime Lease”); provided, however, in the event that any provision of the Transition Services shall conflict in any respect with the Prime Lease, this Agreement shall control.  EQOZB will keep, observe, and perform every term, provision, covenant, and condition required pursuant to the Prime Lease, all of which are incorporated herein by reference, to the extent relating to EQOZB’s use of any part of the Premises, and will not do or permit anything to be done that could constitute a default under the Prime Lease.  Lencore will have the same rights and remedies with respect to a breach hereof or of the Prime 

12

 

Lease as the Prime Landlord would have against Lencore, and Lencore will have, with respect to EQOZB, all of the rights the Prime Landlord under the Prime Lease would have.  Lencore will not be responsible to EQOZB for any breach of the Prime Lease by the Prime Landlord.

 

EQOZB will procure and maintain the following policies of insurance during the Transition Period, naming Lencore as an additional insured with respect to (b), (c), (d) and (e): (a) Workers’ Compensation with limits required by statute; (b) Employment Practices  Liability, solely relating to the Leased Employees, with limits not less than $1,000,000; (c) Commercial General Liability including Bodily Injury and Property Damage, with limits not less than $2,000,000 per occurrence and $4,000,000 general aggregate (may be satisfied in combination with Umbrella/Excess Liability); (d) Fire and Extended coverage insurance on its property in the Premises; and (e) Umbrella / Excess Liability with limits not less than $2,000,000 per occurrence and $4,000,000 general aggregate.  EQOZB will provide not less than thirty (30) days written notification of any cancellation or expiration of any such policy, and will provide certificates of such policies to Lencore upon request.  

 

EQOZB agrees further to indemnify, defend and hold Prime Landlord and Lencore harmless from and against (and to reimburse Prime Landlord) any and all claims and Losses that arise from or in connection with (or are alleged to arise from or in connection with) the use, occupancy, conduct or management of the Premises by EQOZB, or its agents, employees, contractors, representatives, invitees, or visitors, or EQOZB’s business activities therein. 

 

Rent shall be $23,500 per month and shall be payable to Lencore consistent with the terms of the Prime Lease, including without limitation the timing of payments and any interest and/or penalties associated with late payment.

 

13

 

Exhibit B

 

EQOZB TRANSITION SERVICES

 

1.Marketing.  Transitioning of database of n.Form exclusive contacts, collateral materials, handoff of existing marketing and advertising programs and vendors for online marketing initiatives, trade shows and related activities to designated Lencore resource(s).  Lencore to initiate new agreements with third party vendors.

 

Not included:  Direct advertising and marketing spend – these will be paid directly by Lencore.

 

2.SAP / Accounting.  Billing, collections, accounts payable, accounts receivable and monthly financial statement preparation to be handed off to EQOZB accounting team, using the upgraded SAP platform (version 9.3).  Lencore will have access to the SAP platform for a period of time, not to exceed thirty (30) days post-Closing, while Lencore builds out its own SAP platform; Lencore will have access to the corresponding paper files throughout the Transition Period.

 

3.Order Processing (LOOP).  Processing of customer purchase orders, transmission of orders to plant, verification of delivery information, verification of installation and tuning services to be handed off to Lencore or EQOZB resource, as appropriate.

 

Inbound Requests for Quotation from customers for n.Form products to be handed off to the n.Form (Lencore) D&Q department.

 

4.IT Services (Support through CHiPs).  Help desk support, data backup, application support (Microsoft, AutoCAD, etc.) to be transitioned to EQOZB with CHiPs as soon as practicable.  n.Form exclusive customer files including quotes, order information, wiring diagrams, “as-builts”, etc. to be transferred to Lencore.

 

5.Procurement / Inventory.  EQOZB inventory to be separated from Lencore’s n.Form inventory including raw materials and sub-assemblies at or about the Closing and to be segregated as agreed upon by the Parties as soon as practicable.

 

6.Tech Support (Client).  To the extent that EQOZB receives inquiries by phone, email or other means from customers who have purchased n.Form products at any time related to technical support of customer and installer trouble shooting questions, EQOZB will hand those off to designated Lencore representatives who will be responsible for addressing and resolving them.

 

7.Leased Employee Cooperation.  To the extent EQOZB is required to make any EEO-1 or similar filings which would include information related to the Leased Employees, Lencore agrees to reasonably cooperate with Emmis in preparing any such filings.   

 

8.Engineering.  PCB designs, Gerber files, software files, BOMs, sub-assembly BOMs schematics and various working documents and information related exclusively to n.Form products to be transferred to Lencore Engineering team, and to the extent related to n.Form products but not exclusively related to n.Form products, to be made available through copies and the like for use in accordance with the Restrictive Covenant and Technology Cross-License Agreement.

 

14

 

Lencore will continue to have access to the following data to the extent exclusively related to n.Form :

 

Engineering drive on file server

Drawings drive on server

Data drive on server

 

Zendesk (Cloud support ticketing system)

JIRA (Cloud bug-tracking system)

Bitbucket (Cloud source-code repositories)

Airtable (Cloud-based databases for production product version tracking and RMA tracking)

 

9.Other.  Email – Jonathan Leonard, Christian Payne and Glenn Dahl need to have access to their respective @lencore.com email addresses throughout the Transition Period; provided that any and all inquiries received through such email addresses that are related to the Company’s Business shall be promptly referred to EQOZB.   EQOZB will enable an “auto-responder” indicating that other Lencore employees no longer have access to the @lencore.com url, and attaching contact information to the auto-responder for the relevant Lencore employee.  EQOZB employees will notify and hand off to a designated Lencore resource any issues that should remain with Lencore and will assist in transitioning whatever issues are outstanding to the appropriate person at Lencore so as to minimize disruption to Lencore’s business.

 

Mail & Notices – EQOZB and Lencore will cooperate in forwarding mail that ought to have been addressed to the other, or that needs to be dealt with by the other.

 

Acquired Assets.  EQOZB will remove all Acquired Assets from the basement of the 1 Crossways Park Drive building within thirty (30) days or as reasonably practicable thereafter.

15

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00306-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00306-of-00352.parquet"}]]