Document:

Exhibit 10(C)

 

Exhibit 10(c)

Execution Copy

FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT

     THIS FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT (this “Amendment”), is
made and entered into as of October 18, 2004, by and among HARRIS CORPORATION,
a Delaware corporation (the “Borrower”), the Lenders (as defined below) party
hereto and SUNTRUST BANK, in its capacity as Administrative Agent for the
Lenders (the “Administrative Agent”), as the issuing bank for the letters of
credit (the “L/C Issuer”) and as the swingline lender (the “Swingline Lender”).

WITNESSETH:

     WHEREAS, the Borrower, the several banks and other financial institutions
from time to time party thereto (collectively, the “Lenders”), and the
Administrative Agent are parties to that certain Revolving Credit Agreement,
dated as of October 15, 2003 (as amended, restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”; capitalized terms used
herein and not otherwise defined shall have the meanings assigned to such terms
in the Credit Agreement), pursuant to which the Lenders have made certain
financial accommodations available to the Borrower;

     WHEREAS, the Borrower has requested that the Lenders and the
Administrative Agent amend certain provisions of the Credit Agreement and
subject to the terms and conditions hereof, the Lenders are willing to do so;

     NOW, THEREFORE, for good and valuable consideration, the sufficiency and
receipt of all of which are acknowledged, the Borrower, the Lenders and the
Administrative Agent agree as follows:

     1. Amendments.

     (a) Section 1.01 of the Credit Agreement is hereby amended by deleting
the defined term “Consolidated Tangible Net Worth” in its entirety.

     (b) Section 7.06(a) of the Credit Agreement is hereby amended by
replacing such Section in its entirety with the following:

     7.06(a) Intentionally Omitted.

     2. Conditions to Effectiveness of this Amendment. Notwithstanding any
other provision of this Amendment and without affecting in any manner the
rights of the Lenders hereunder, it is understood and agreed that this
Amendment shall not become effective, and the Borrower shall have no rights
under this Amendment, until the Administrative Agent shall have received (i)
such fees as the Borrower has previously agreed to pay the Administrative Agent
or

1

 

any of its affiliates in connection with this Amendment and (iii) executed
counterparts to this Amendment from the Borrower and the Required Lenders.

     3. Representations and Warranties. To induce the Lenders and the
Administrative Agent to enter into this Amendment, the Borrower hereby
represents and warrants to the Lenders and the Administrative Agent that:

     (a) The execution, delivery and performance by the Borrower of this
Amendment (i) are within the Borrower’s power and authority; (ii) have been
duly authorized by all necessary corporate and shareholder action; (iii) are
not in contravention of any provision of the Borrower’s certificate of
incorporation or bylaws or other organizational documents; (iv) do not violate
any law or regulation, or any order or decree of any Governmental Authority;
(v) do not conflict with or result in the breach or termination of, constitute
a default under or accelerate any performance required by, any indenture,
mortgage, deed of trust, lease, agreement or other instrument to which the
Borrower or any of its Subsidiaries is a party or by which the Borrower or any
such Subsidiary or any of their respective property is bound; (vi) do not
result in the creation or imposition of any Lien upon any of the property of
the Borrower or any of its Subsidiaries; and (vii) do not require the consent
or approval of any Governmental Authority or any other Person (other than the
Required Lenders);

     (b) This Amendment has been duly executed and delivered by the Borrower
and constitutes a legal, valid and binding obligation of the Borrower,
enforceable against the Borrower in accordance with its terms except as the
enforceability hereof may be limited by bankruptcy, insolvency, reorganization,
moratorium and other laws affecting creditors’ rights and remedies in general;
and

     (c) After giving effect to this Amendment, the representations and
warranties contained in the Credit Agreement and the other Loan Documents are
true and correct in all material respects, and no Default or Event of Default
has occurred and is continuing as of the date hereof.

     4. Effect
of Amendment. Except as set forth expressly herein, all terms
of the Credit Agreement, as amended hereby, and the other Loan Documents shall
be and remain in full force and effect and shall constitute the legal, valid,
binding and enforceable obligations of the Borrower to the Lenders and the
Administrative Agent. The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate as a waiver
of any right, power or remedy of the Lenders under the Credit Agreement, nor
constitute a waiver of any provision of the Credit Agreement. This Amendment
shall constitute a Loan Document for all purposes of the Credit Agreement.

     5. Governing Law. This Amendment shall be governed by, and construed in
accordance with, the internal laws of the State of New York and all applicable
federal laws of the United States of America.

2

 

     6. No Novation. This Amendment is not intended by the parties to be, and
shall not be construed to be, a novation of the Credit Agreement or an accord
and satisfaction in regard thereto.

     7. Costs
and Expenses. The Borrower agrees to pay on demand all costs and
expenses of the Administrative Agent in connection with the preparation,
execution and delivery of this Amendment, including, without limitation, the
reasonable fees and out-of-pocket expenses of outside counsel for the
Administrative Agent with respect thereto.

     8. Counterparts. This Amendment may be executed by one or more of the
parties hereto in any number of separate counterparts, each of which shall be
deemed an original and all of which, taken together, shall be deemed to
constitute one and the same instrument. Delivery of an executed counterpart of
this Amendment by facsimile transmission or by electronic mail in pdf form
shall be as effective as delivery of a manually executed counterpart hereof.

     9. Binding Nature. This Amendment shall be binding upon and inure to the
benefit of the parties hereto, their respective successors,
successors-in-titles, and assigns.

     10. Entire Understanding. This Amendment sets forth the entire
understanding of the parties with respect to the matters set forth herein, and
shall supersede any prior negotiations or agreements, whether written or oral,
with respect thereto.

[Signature Pages To Follow]

3

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective authorized officers as of the day and year
first above written.

	 	 	 	 	 
	 	 	HARRIS CORPORATION, as Borrower*
	 
	 	 	 	 
	

	 	By:
	 	/s/ Howard L. Lance
	

	 	 	 	
 
	

	 	Name:
	 	Howard L. Lance
	

	 	Title:
	 	Chairman, President and
Chief Executive Officer
	 
	 	 	 	 
	

	 	By:
	 	/s/ Bryan R. Roub
	

	 	 	 	
 
	

	 	Name:
	 	Bryan R. Roub
	

	 	Title:
	 	Senior Vice President &
Chief Financial Officer

* The signatures of two authorized officers are required

[SIGNATURE PAGE TO FIRST AMENDMENT]

4

 

	 	 	 	 	 
	 	 	LENDERS:
	 
	 	 	 	 
	 	 	SUNTRUST BANK, as Administrative Agent, L/C Issuer and a Lender
	 
	 	 	 	 
	

	 	By:
	 	/s/ William C. Barr, III
	

	 	 	 	
 
	

	 	Name:
	 	William C. Barr, III
	

	 	Title:
	 	Director
	 
	 	 	 	 
	 	 	BANK OF AMERICA, N.A., as a Lender
	 
	 	 	 	 
	

	 	By:
	 	/s/ Kevin McMahon
	

	 	 	 	
 
	

	 	Name:
	 	Kevin McMahon
	

	 	Title:
	 	Managing Director
	 
	 	 	 	 
	 	 	THE BANK OF NEW YORK, as a Lender
	 
	 	 	 	 
	

	 	By:
	 	/s/ David C. Siegel
	

	 	 	 	
 
	

	 	Name:
	 	David C. Siegel
	

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 	 	THE BANK OF NOVA SCOTIA, as a Lender
	 
	 	 	 	 
	

	 	By:
	 	/s/ Chris Osborn
	

	 	 	 	
 
	

	 	Name:
	 	Chris Osborn
	

	 	Title:
	 	Managing Director
	 
	 	 	 	 
	 	 	CITIBANK, N.A., as a Lender
	 
	 	 	 	 
	

	 	By:
	 	/s/ James Walsh
	

	 	 	 	
 
	

	 	Name:
	 	James Walsh
	

	 	Title:
	 	Managing Director

[SIGNATURE PAGE TO FIRST AMENDMENT]

5

 

	 	 	 	 	 
	 	 	FLEET NATIONAL BANK, as a Lender
	 
	 	 	 	 
	

	 	By:
	 	/s/ Kevin McMahon
	

	 	 	 	
 
	

	 	Name:
	 	Kevin McMahon
	

	 	Title:
	 	Managing Director
	 
	 	 	 	 
	 	 	HSBC BANK USA, as a Lender
	 
	 	 	 	 
	

	 	By:
	 	/s/ Guy R. Nudd
	

	 	 	 	
 
	

	 	Name:
	 	Guy R. Nudd
	

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 	 	THE NORTHERN TRUST COMPANY, as a Lender
	 
	 	 	 	 
	

	 	By:
	 	/s/ Eric Dybing
	

	 	 	 	
 
	

	 	Name:
	 	Eric Dybing
	

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 	 	SOCIETE GENERALE, CHICAGO BRANCH, as a Lender
	 
	 	 	 	 
	

	 	By:
	 	/s/ Kimberly A. Metzger
	

	 	 	 	
 
	

	 	Name:
	 	Kimberly A. Metzger
	

	 	Title:
	 	Vice President
	 
	 	 	 	 
	 	 	WACHOVIA BANK, N.A., as a Lender
	 
	 	 	 	 
	

	 	By:
	 	/s/ Robert Sevin
	

	 	 	 	
 
	

	 	Name:
	 	Robert Sevin
	

	 	Title:
	 	Director

[SIGNATURE PAGE TO FIRST AMENDMENT]

6Exhibit 10.1 LICENSE AGREEMENT

 

License Reference Number:
F-090104

 

 LICENSE
AGREEMENT

 BETWEEN

MOTOROLA, INC.

AND

FORWARD INDUSTRIES,
INC.

               

 

 

	TABLE OF CONTENTS	 	 
	 	 	 
	 	 	 	 
	1.	
	DEFINITIONS	4	 
	 	 	 	 
	2.	
	GRANT OF LICENSE	6	 
	 	 	 	 
	3.	
	QUALITY CONTROL	7	 
	 	 	 	 
	4.	
	CONDITIONS APPLICABLE TO APPEARANCE OF TRADEMARKS	10	 
	 	 	 	 
	5.	
	PROTECTION OF TRADEMARKS	11	 
	 	 	 	 
	6.	
	PRODUCT WARRANTY AND SUPPORT	12	 
	 	 	 	 
	7.	
	COSTS	13	 
	 	 	 	 
	8.	
	ROYALTIES	13	 
	 	 	 	 
	9.	
	SALES AND MARKETING	16	 
	 	 	 	 
	10.	
	TERM AND TERMINATION	17	 
	 	 	 	 
	11.	
	POST TERMINATION RIGHTS AND OBLIGATIONS	19	 
	 	 	 	 
	12.	
	CONFIDENTIALITY AND INTELLECTUAL PROPERTY	20	 
	 	 	 	 
	13.	
	EXPORT	22	 
	 	 	 	 
	14.	
	REPRESENTATIONS AND WARRANTIES	23	 
	 	 	 	 
	15.	
	INDEMNITY AND INSURANCE	24	 
	 	 	 	 
	16.	
	DISPUTE RESOLUTION	25	 
	 	 	 	 
	17.	
	FORCE MAJEURE	26	 
	 	 	 	 
	18.	
	LIMITATION OF LIABILITY	26	 
	 	 	 	 
	19.	
	INTELLECTUAL PROPERTY	26	 
	 	 	 	 
	20.	
	PRESS RELEASES	27	 
	 	 	 	 
	21.	
	ETHICS AND CONFLICTS OF INTEREST	27	 
	 	 	 	 
	22.	
	NOTICES	27	 
	 	 	 	 
	23.	
	ASSIGNMENT OF RIGHTS AND SUBLICENSE	
	29
	 
	 	 	 	 
	24.	
	FREEDOM OF ACTION	
	29
	 
	 	 	 	 
	25.	APPROVALS	
	30
	 

 

 

	26.	
	WAIVER OF DEFAULT OR OTHER RIGHTS	30	 
	 	 	 	 	 
	27.	
	SEVERABILITY	30	 
	 	 	 	 	 
	28.	
	SECTION HEADINGS	30	 
	 	 	 	 	 
	29.	EXHIBITS	 	30	 
	 	 	 	 	 
	30.	SURVIVAL	 	31	 
	 	 	 	 	 
	31.	
	TIME IS OF THE ESSENCE	31	 
	 	 	 	 	 
	32.	
	RIGHTS CUMULATIVE	31	 
	 	 	 	 	 
	33.	
	ENTIRE AGREEMENT	31	 
	 	 	 	 	 
	34.	
	GOVERNING LAW	31	 
	 	 	 	 	 
	EXHIBIT A	TRADEMARKS AND TRADE DRESS	 	 
	 	 	 	 	 
	EXHIBIT B	TERRITORY	 	 
	 	 	 	 	 
	EXHIBIT C	PRODUCTS	 	 
	 	 	 	 	 
	EXHIBIT D	CONTROL SPECIFICATIONS	 	 
	 	 	 	 	 
	EXHIBIT E	MANUFACTURER’S AGREEMENT	 	 
	 	 	 	 	 
	EXHIBIT F	SALES YEAR; MINIMUM ROYALTY; ROYALTY RATE	 	 
	 	 	 	 	 
	EXHIBIT G	APPROVED SUPPLIERS	 	 
	 	 	 	 	 
	EXHIBIT H	PRODUCT WARRANTY	 	 
	 	 	 	 	 
	EXHIBIT I	REPORTING REQUIREMENTS	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 

	

 

 

 

LICENSE
AGREEMENT

 

THIS AGREEMENT is made as of October
1, 2004 between:

(1)       MOTOROLA,
INC., a Delaware corporation, having its principal office at 1303 East
Algonquin Road, Schaumburg, Illinois 60196, USA, and its subsidiaries and
affiliates ("Motorola"); and

(2)        FORWARD INDUSTRIES, INC.,
a New York corporation, having its principal office at 1801 Green Road, Pompano
Beach, Florida 33064, and its subsidiaries and affiliates ("Licensee").                                                                                                                                                                    

with reference to the
following recitals:

A.         Motorola wishes to
license certain Trademarks;

B.         Licensee wishes to use
the Trademarks upon and in connection with the manufacture, sale, marketing,
and distribution of the Products;  

C.         The Trademarks
constitute valuable rights owned and used by Motorola in conducting its
business and designating the origin or sponsorship of distinctive trademarked
products by Motorola;

D.         Motorola desires to
protect the integrity of its Trademarks and to preserve its right to label its
products and those of its licensees with its Trademarks so as to avoid consumer
confusion and to distinguish its products and those of its licensee from those
of its competitors; and

E.         Licensee and Motorola
agree that certain restrictions as set forth herein on Licensee's use of the
Trademarks are necessary to ensure that the Trademarks are not diluted or subject
to disrepute in the course of Licensee's use of the Trademarks, and that
Motorola's reputation is not subjected to disrepute, and that Motorola's rights
in the Trademarks and ownership of the Trademarks are preserved.

NOW, THEREFORE, in
consideration of the mutual promises of this Agreement, the parties agree as
follows:

1.        
DEFINITIONS

1.1       In
this Agreement:

"Approved Sample" means
Product or Product Materials that have been delivered to and approved in
writing by the Motorola Representative as provided in Section 3.2 of this
Agreement.

4

"Approved Manufacturer" means
a contract manufacturer or supplier to Licensee of the Product or Product
Materials that has been approved by Motorola and has executed a Manufacturer's
Agreement incorporating all of the terms of the Manufacturer's Agreement set
forth in Exhibit E.

"Approved Supplier" means
those Motorola suppliers listed on Exhibit G.  Licensee does not have to
execute a Manufacturer's Agreement in order to obtain Products from the
Approved Suppliers.

"Business Day" means a day that is not a Saturday or
Sunday or a legal holiday and on which banks are not required or permitted by
law or other governmental action to close in Illinois or New York, New York.

"Days" means calendar days.

"Derivative Works" means any computer
program, work, product, service, improvement, supplement, modification,
alteration, addition, revision, enhancement, new version, new edition, remake,
sequel, translation, adaptation, design, plot, theme, character, story line,
concept, scene, audio-visual display, interface element or aspect, in any
medium, format, use or form whatsoever, whether interactive or linear and
whether now known or unknown (including but not limited to sound recordings,
phonorecords, computer-assisted media, games, books, magazines, periodicals,
merchandise, animation, home videos, radio, motion pictures, cable and
television), that is derived directly or indirectly, from any Trademarks, or
any part or aspect of any thereof, or that uses or incorporates any of the
Trademarks, or any part or aspect of any thereof.

"Effective Date" means the date in the
heading on page 4 of this Agreement.

"Gross Sales" means the gross invoice
amount billed by Licensee for Products sold to its customers, other than
Motorola, its subsidiaries and its Affiliates.

"Intellectual Property Rights" means any and all (by whatever name or term known or designated)
tangible and intangible and now known or hereafter existing: (i) rights
associated with works of authorship throughout the universe, including but not
limited to copyrights (including without limitation the sole and exclusive
right to prepare Derivative Works of copyrighted works and to copy,
manufacture, reproduce, lend, distribute copies of, modify, publicly perform
and publicly display the copyrighted work and all derivative works thereof),
moral rights (including without limitation any right to identification of
authorship and any limitation on subsequent modification) and mask-works; (ii) rights
in and relating to the protection of trademarks, service marks, trade names,
goodwill, rights in packaging, rights of publicity, merchandising rights,
advertising rights and similar rights; (iii) rights in and relating to the
protection of trade secrets and confidential information; (iv) patents,
designs, algorithms and other industrial property rights and rights associated
therewith; (v) other intellectual and industrial property and proprietary
rights (of every kind and nature throughout the universe and however
designated) relating to intangible property that are analogous to any of the
foregoing rights (including without limitation logos, character rights,
"rental" rights and rights to remuneration), whether arising by operation of
law, contract, license or otherwise; (vi) registrations, applications,
renewals, extensions, continuations, divisions or reissues thereof now or
hereafter in force throughout the universe (including without limitation rights
in any of the foregoing); and (vii) rights in and relating to the sole and
exclusive possession, ownership and use of any of the foregoing throughout the
universe, including without limitation the right to license and sublicense,
franchise, assign, pledge, mortgage, sell, transfer, convey, grant, gift over,
divide, partition and use (or not use) in any way any of the foregoing now or
hereafter (including without limitation any claims and causes of action of any
kind with respect to, and any other rights relating to the enforcement of, any
of the foregoing).

5

 

"Laws" mean any and all applicable laws,
rules, regulations, including, but not limited to, local and national laws,
rules and regulations, treaties, pertaining to any activities of Motorola or
any third party engaged by Motorola in connection with the performance of the
obligations arising under this Agreement.

"Manufacturer's Agreement" means an
agreement among Motorola, Licensee and a manufacturer or supplier of the
Product or Product Materials incorporating all of the terms of the
Manufacturer's Agreement set forth in Exhibit E.

"Minimum Royalty" has the meaning
ascribed thereto in Section 8.3.1.

"Motorola Representative" means the
person or persons designated by Motorola in writing to receive and respond to
requests for approval, results of inspections and tests, product warranty
reports and correspondence (other than Notices as provided in Section 22)
regarding Licensee's performance of its duties under this Agreement.  

"Net Sales" means Gross Sales, less
refunds, taxes, freight, insurance, customs duties, credits and allowances
actually allowed to customers for returned Products.

"Product" or "Products" means
specific products or product categories as established in Exhibit C for which
the Licensee is authorized under this Agreement and that have been approved by Motorola
as provided in this Agreement and that bear the Trademarks.

"Product Materials" means warranty
statement, user guide, packaging and marketing materials, including but not
limited to point-of-sale materials, publicity, advertising, signs, catalogs
product brochures and other in-box materials relating to the Product.

"Sales Year" or "Sales Years" means the periods
of time as set forth in Exhibit F during which sales of Products are measured.

"Territory" means the authorized counties referred to
in Exhibit B subject to the restrictions in Section 13. 

"Trademarks" means one or more the trade names,
logos, trade dress, trademarks, and service marks referred to in Exhibit A.

"Trademark Use Specification" means the standards of
trademark use referred to in Exhibit D to be applied to all uses of the
Trademarks made by Licensee pursuant to this license.                    

 

6

2.         GRANT
OF LICENSE2.1        Motorola grants to
Licensee, subject to the terms and conditions of this Agreement, the
non-exclusive right to use the Trademarks upon the Products and in connection
with the manufacture, sale, marketing and distribution of the Products in the
Territory.

2.2       Licensee may manufacture Products or have Products manufactured for it
anywhere in the world subject to the terms of this Agreement including the
restrictions and obligations of Sections 3 and 13 of this Agreement.

2.3       Licensee is
further authorized to use in the Territory the Trademarks in marketing
materials directly related to Products including the use of the Trademarks in
publicity, advertising, signs, catalogs, product brochures, packaging, and
other forms of advertising, subject to the terms and conditions of this
Agreement.

3.         QUALITY
CONTROL

3.1       Licensee shall use the Trademarks in the manner
set forth in the Trademark Use Specifications. The Trademark Use Specifications
are furnished to Licensee, in confidence pursuant to Section 12 of this
Agreement.

3.2       Prior to the manufacture of any Product, Licensee
must obtain Motorola's written approval of final production samples of each
Product and Licensee must obtain Motorola's written approval of all Product
Materials, prior to the sale, publication, distribution or use of such Product
and Product Materials. Licensee shall furnish, at no cost to Motorola, final
production samples of each Product and corresponding Product Materials to the
Motorola Representative who may retain such final samples at Motorola's
discretion.   Licensee acknowledges that Motorola may perform SAR tests on the
production samples and that no production sample will be approved unless it
passes SAR testing.  Motorola agrees to notify Licensee in writing within
fifteen (15) business days if it approves of such final production samples of
each Product and final production samples of Product Materials.  Motorola's
approval shall not be unreasonably withheld.  If such Product and/or Product
Materials are not approved, Motorola will advise Licensee of the reasons
therefor, in reasonable detail, including corrections required by Motorola.  Licensee
shall make all such corrections at its expense, or withdraw the proposed
Product and/or Product Materials from consideration. Licensee agrees not to
make any changes to such Approved Product or Product Materials without seeking
approval from Motorola.  The quality of Product for sale by Licensee shall at
all times be the same in appearance, form, fit, function, quality and
regulatory compliance to that of the Approved Sample. Any review and/or
approval by Motorola shall not relieve Licensee from its obligations provided
in this Agreement.

            3.3.2    Each Product and Product Materials
shall at all times (i) conform to the terms of this Agreement; (ii) conform to
the Trademark Use Specifications and (iii) be the same in appearance, form,
fit, function and regulatory compliance to the Approved Sample of the Product
or Product Materials.  

7

            3.3.3     If at any time the Product and/or
Product Materials fail to (i) conform to the terms of this Agreement; or (ii)
conform with the Trademark Use Specifications; or (iii) conform in appearance,
form, fit, function and regulatory compliance to the Approved Samples, Licensee
shall Promptly, but in no event later than thirty (30) business days of
becoming aware of such failure, make all changes necessary to bring such
Product and/or Product Materials into conformance, or cease using the
Trademarks on a nonconforming Product and/or Product Materials, or cease
selling the Product. In addition, Licensee may be required by Motorola within
ten (10) business days after becoming aware of such nonconformance, to take
steps to withdraw any nonconforming Products and/or Product Materials from the
market if reasonably determined by Motorola, after consultation with Licensee,
to be a nonconformance creating significant safety, quality, customer
satisfaction or negative brand impact issues. 

            3.3.4     If at any
time Motorola reasonably determines a Product and or Product Materials fail to
(i) conform to the terms of this Agreement; or (ii) conform with the Trademark
Use Specifications; or (iii) is not the same in appearance, form, fit, function
and regulatory compliance to the Approved Sample, Motorola or its authorized
representative shall so notify Licensee, specifying the nonconformance in
reasonable detail. Upon such notification, Licensee shall Promptly, but in no
event later than thirty (30) business days, make all changes necessary to bring
the Products and/or Product Materials into conformance, or cease using the
Trademarks on the nonconforming Product and/or Product Materials, or cease
selling the Product. In addition, Licensee may be required by Motorola within
ten (10) business days after becoming aware of such nonconformance, take steps
to withdraw any nonconforming Products and/or Product Materials from the market
if reasonably determined by Motorola, after consultation with Licensee,  to be
a nonconformance creating significant safety, quality, customer satisfaction or
negative brand impact issues. 

3.4       If requested by Motorola due to reasonable
concerns over nonconformance with the Approved Samples, Licensee shall, at its
own expense, submit to Motorola results of inspections and tests that have been
performed by an independent testing laboratory on randomly selected samples of
each Product to show conformance. In addition, Motorola may require Licensee,
at Licensee's own expense, to perform tests at an independent laboratory
approved by Motorola to show conformance of the
Product with the Approved Samples. At its sole discretion, Motorola may
purchase the Product, at its own expense, from retail outlets or from
distributors and review the Product and Product Materials to ensure that they
conform in appearance, form, fit, function and regulatory compliance to the
Approved Samples and the Trademark Use Guidelines.

3.5       Upon five (5)
business days' notice to Licensee, Motorola shall have the right to conduct or
have conducted, during regular business hours, an examination of Products
manufactured by or for Licensee (including those assembled or tested) at
Licensee's facilities to determine compliance of such Products with the
Approved Sample(s) and the Trademark Use Guidelines. If at any time the
Products fail to conform in appearance, form, fit, function and regulatory
compliance to the Approved Sample(s) or the Trademark Use Guidelines, Motorola
or its authorized representative shall so notify Licensee, specifying the
noncompliance in reasonable detail.. Upon such notification, Licensee shall
Promptly, but in no event later than thirty (30) business days, make all
changes necessary to bring the Products and/or Product Materials into
conformance, or cease using the Trademarks on such nonconforming Products
and/or Product Materials, and/or cease selling such Products. In addition,
Licensee may be required by Motorola, after consultation with Licensee,  within
ten (10) business days after becoming aware of such nonconformance, take steps
to withdraw any nonconforming Products and/or Product Materials from the market
if reasonably determined by Motorola to be a nonconformance creating
significant safety, quality, customer satisfaction or negative brand impact
issues. 

8

3.6       Licensee is authorized to purchase Product and
Product Materials from the Approved Suppliers.   Licensee must obtain
Motorola's written consent prior to using any other third party to manufacture
or to supply Licensee with any Product or Product Materials. Licensee shall
forward to Motorola a written list of proposed manufacturers or suppliers and
the Products that each is to manufacture or supply and the location(s) where
such Products shall be manufactured. Motorola may request any additional
business or credit information regarding the proposed manufacturer or supplier
it deems necessary to make a determination.  Motorola agrees to Promptly review
the list and to notify Licensee of its decision, and, if not approved, to
advise Licensee, in writing stating the reasons for the rejection in reasonable
detail.  A manufacturer or supplier who is so approved is an Approved
Manufacturer for only that Product for which it is approved and only after
executing a Manufacturer's Agreement.  

3.7       Prior to manufacturing any Product or using any
Approved Manufacturer to manufacture any Product, Licensee shall execute a
Manufacturer's Agreement or have the proposed manufacturer execute a
Manufacturer's Agreement that has terms which are legally enforceable in the
jurisdiction in which the Product or Product Materials are manufactured or
supplied and includes at least the same terms and conditions as those set out
in the Manufacturer's Agreement in Exhibit E.  Licensee may include additional
terms in the Manufacturer's Agreement provided they do not result, in the
opinion of Motorola, in a reduction in the protections and remedies available
to Motorola under the terms in Exhibit E. A copy of the executed Manufacturer's
Agreement shall be delivered to Motorola before the Licensee or any Approved
Manufacturer may commence the manufacture or supply of any Product or Product
Materials.

3.8       Should either party become aware of any applicable
laws or regulations in any jurisdiction in the Territory that are inconsistent
with the provisions and intent of the Manufacturer's Agreement, it shall notify
the other party within five (5) days of becoming aware of such inconsistency.

3.9       If Motorola
determines that the Licensee or an Approved Manufacturer has breached any
Manufacturer's Agreement, Motorola shall advise the Licensee of the breach in
reasonable detail, and, in the case of a breach by an Approved Manufacturer,
instruct Licensee to use commercially reasonable efforts to enforce the
Manufacturer's Agreement against the breaching Approved Manufacturer. Breaches
shall include failure of the Licensee or an Approved Manufacturer to meet any
of its obligations included in the terms of the Manufacturer's Agreement in
Exhibit E. Licensee will comply with the Manufacturer's Agreement or will use
commercially reasonable efforts to enforce the Manufacturer's Agreement against
the breaching Approved Manufacturer by obtaining a cure of the breach or
terminating the Manufacturer's Agreement within thirty (30) days from
Motorola's notice to Licensee. If the Licensee or the Approved Manufacturer
fails within this thirty (30) day period to cure such breach to the reasonable
satisfaction of Motorola, all rights to manufacture Product and/or Product
Materials under this Agreement are immediately terminated and that Approved
Manufacturer shall immediately be terminated as an Approved Manufacturer.

 

 

9

3.10     If Licensee determines
that an Approved Manufacturer has breached any Manufacturer's Agreement,
Licensee shall immediately give notice to Motorola of such breach in reasonable
detail. Licensee will use commercially reasonable efforts to enforce the
Manufacturer's Agreement against the breaching Approved Manufacturer by
obtaining a cure of the breach or terminating the Manufacturer's Agreement
within thirty (30) days of Licensee's determination. Licensee acknowledges that
any failure by Licensee to comply with the Manufacturer's Agreement or to enforce
or terminate any Manufacturer's Agreement against a breaching Approved
Manufacturer in accordance with Section 3.10 is a material breach of this
Agreement, and that such failure will cause irreparable harm and damages to
Motorola.

3.11     If Licensee fails or refuses to immediately comply with or enforce the
Manufacturer's Agreement against the breaching Approved Manufacturer in
accordance with Sections 3.9 and 3.10, Motorola shall have the right to enforce
the provisions of the Manufacturer's Agreement relating to use and registration
of the Trademarks against the Licensee or the breaching Approved Manufacturer.
In such cases, the reasonable and documented out-of-pockets costs of enforcing
the Manufacturer's Agreement, including but not limited to reasonable attorneys
fees, shall be paid by Licensee, whether the Manufacturer's Agreement is
enforced by Motorola or Licensee. Licensee agrees to cooperate fully with
Motorola, at Licensee's own expense, if Motorola enforces the provisions of the
Manufacturer's Agreement relating to use and registration of the Trademarks
breached by an Approved Manufacturer. 

3.12    Upon seven (7) business days' notice to Licensee, who shall in turn
notify any pertinent Approved Manufacturer, Motorola shall have the right to
inspect or have inspected, at Motorola's expense, the manufacturing facilities
of the Approved Manufacturer during regular business hours to determine
compliance with the terms of the Manufacturer's Agreement and compliance of the
Products and/or Product Materials with the Trademark Use Specifications and
Approved Sample(s) being manufactured at Approved Manufacturer's facilities. If
at any time the Products and/or Product Materials fail to conform to the
Trademark Use Specifications or are not the same in appearance, form, fit,
function and regulatory compliance to the Approved Sample(s), Motorola or its
authorized representative shall so notify Licensee, specifying the
noncompliance in reasonable detail. Upon such notification, Licensee shall
Promptly, but in no event later than thirty (30) business days, work with the
Approved Manufacturer to make all changes necessary to bring such Products
and/or Product Materials into conformance, or cease using the Trademarks on
such nonconforming Products and/or Product Materials, or cease selling such
Products.   In addition, Licensee may be required by Motorola, after
consultation with Licensee, within ten (10) business days after becoming aware
of such nonconformance, to take steps to withdraw any nonconforming Products
and/or Product Materials from the market if reasonably determined by Motorola
to be a nonconformance creating significant safety, quality, customer
satisfaction or negative brand impact issues. 

4.         CONDITIONS
APPLICABLE TO APPEARANCE OF TRADEMARKS

4.1       Motorola may modify the Trademarks
Use Specifications regarding the style, appearance and manner of use of the
Trademarks as necessary, in its sole discretion; If Motorola requires Licensee
to implement such changes, it shall give written notice to Licensee of any such
change(s). Licensee shall promptly implement the revised Trademarks Use
Specifications on a running change basis, but in no event later than one hundred
twenty (120) business days of Licensee's receipt of Motorola's notification of
any change in the Trademarks Use Specifications.  Any use of the Trademarks
not specifically provided for by the Trademarks Use Specifications shall be
adopted by Licensee only upon prior approval in writing by Motorola. 
Licensee shall have the right, in accordance with the terms of this Agreement,
to sell, in the ordinary course of business, Product inventory that exists at
the time of receipt of notice of changes in the Trademarks Use Specifications.

10

 

4.2       Motorola
may require, to the extent practicable, that the following notice, all or in
part, be used on the Products and/or Product Materials to identify the licensed
use under the Agreement and the proprietary rights of Motorola: "Manufactured,
distributed or sold by (the "Licensee"), official licensee for this product.  Motorola,
the Motorola logo trademarks and the Motorola trade dress are owned by
Motorola, Inc. and are used under license from Motorola, Inc.  Please contact
(the "Licensee") at (phone #, email, etc.) for questions/comments, warranty,
support, or service related to this product. MOTOROLA and the Stylized M Logo
are registered in the U.S. Patent & Trademark Office. © Motorola, Inc. 200X
(with X being the date of publication)."

4.3       Motorola may require
through written notice that Licensee adopt and use different Trademarks and/or
Product Materials specifications for different countries in the Territory, and
Licensee agrees to be bound by such requirements of Motorola.  Licensee shall
be permitted a reasonable time after such notice to implement the use of different
Trademarks and/or Product Materials specifications and shall have the right, in
accordance with the terms of this Agreement, to sell, in the ordinary course of
business, Product inventory that exists at the time of receipt of such notice.

5.          PROTECTION OF
TRADEMARKS  

5.1       Licensee acknowledges that Motorola is the exclusive owner of
the Trademarks and any trademark incorporating all or any part of the
Trademarks. Without limiting the foregoing, Licensee hereby assigns to Motorola
all right, title and interest in the Trademarks, together with the goodwill
attaching thereto that may inure to Licensee in connection with this Agreement
or from its use of the Trademarks hereunder.  Licensee agrees to execute and
deliver such documents as necessary for Motorola to register Licensee as
registered user or permitted user, or to withdraw Licensee as a registered user
or permitted user, of the Trademarks.  All use of the Trademarks by Licensee
shall inure to the sole benefit of Motorola.  Licensee shall cooperate and
shall execute all papers reasonably requested by Motorola to effect further
registration, maintenance and renewal of the Trademarks at the sole expense of
Motorola.

5.2       Licensee will not encourage or assist a third
party to register, or attempt in any country to register the copyright, or to
register as a trademark, service mark, design patent or industrial design, any
portion of the Motorola Intellectual Property Rights or derivations or
adaptations thereof, or any work, symbol or design which is so similar thereto
as to clearly suggest associations with or sponsorship by Motorola.  In the
event of any breach of the foregoing, Licensee agrees to terminate the
unauthorized registration activity and to execute and deliver, or cause to be
delivered, to Motorola such assignments and other documents as Motorola may
require to transfer to Motorola all rights to the registrations, patents or
applications involved.  Licensee will not, nor will it encourage or assist a
third party to, challenge the validity or ownership of any patent, copyright,
trademark, or other Intellectual Property Rights or registrations of Motorola. 

11

5.3       If Licensee learns
of any infringement of the Trademarks or of the existence, use or promotion of
any mark or design similar to the Trademarks, Licensee shall Promptly notify
Motorola. Motorola shall have the sole right and discretion to decide what
legal proceedings or other action, if any, shall be taken, by whom, how such
proceedings or other action shall be conducted. Any legal proceedings
instituted pursuant to this Section 5.3 shall be for the sole benefit of
Motorola.  Licensee shall, at the request of Motorola, cooperate and assist
Motorola in any such suit or action, provided that Motorola will promptly
reimburse Licensee for all documented reasonable costs and expenses, including
attorneys' fees.

5.4       In the performance of
this Agreement, Licensee shall comply with applicable laws and regulations, and
those laws and regulations particularly pertaining to the proper use and designation
of trademarks in the countries of said Territory. Should Licensee be or become
aware of any applicable laws or regulations that are inconsistent with the
provisions of this Agreement, Licensee shall Promptly notify Motorola of such
inconsistency. The parties shall then first, in good faith, negotiate a
modification to this Agreement such that it complies with applicable law and
regulations, and if the parties are unable to reach agreement with respect to
such modification, then Motorola may terminate the license and rights granted
hereunder in that jurisdiction and: (i) the Territory set forth in Exhibit B
shall be appropriately amended, and (ii) the Minimum Royalty hereunder shall be
appropriately adjusted based on the average ratio that Licensee's sales in such
jurisdiction is to Licensee's total sales in the Territory during each
quarterly period of each Sales Year of this Agreement.

6.         PRODUCT WARRANTY AND
SUPPORT

6.1       Licensee shall
provide, at a minimum, a one-year, replacement warranty to consumers who
purchase the Products and shall comply with applicable local laws on warranties
in the Territories where the Products are sold.

6.2       Licensee will be
fully responsible for all end user support service and warranty costs,
including but not limited to the following (if applicable): transportation
costs, Product replacements, service labor, field repair, refunds, returns, and
other customer concessions to ensure each customer's satisfaction for the
duration of the applicable warranty period. After consultation with Licensee,
Motorola may require Licensee to halt sales or to recall Product in whole or in
part or to take other corrective actions where Motorola reasonably determines
customer satisfaction, quality, safety, returns or compliance problem(s) exist.

6.3      All Product packaging shall include a conspicuous use of the telephone
number and address for Licensee's customer service department or customer
service representative so that any questions regarding support service for the
Products including warranty can be directed by the consumer or by Motorola to
Licensee. Licensee shall provide the telephone number and address for customer
service to Motorola for each Product before the initial sale of such Product.
If Motorola determines an excess number of questions regarding any Product have
been directed by the consumer to Motorola, Motorola and the licensee shall
mutually agree on a corrective action. If a reasonable corrective action cannot
be agreed to, Motorola may require Licensee to withdraw such Product from the
market or require Licensee to pay Motorola for future costs incurred related to
such questions. 

12

6.4       Throughout the period
during which the warranty for any Product is in effect, Licensee shall provide,
during Licensee's normal business hours, a well-manned telephone service number
for receipt of calls for the Products.  At all other times, such telephone
service number shall have, at a minimum, an automated message specifying the
times during which the service number shall be manned with live personnel.

6.5       Licensee will
collect, prepare reports or, maintain and, upon request, deliver to Motorola,
all applicable data and records relating to Product warranty as set forth in
but not limited to the reporting requirements in Exhibit I. In addition, within
thirty (30) days after the end of each quarterly period, Licensee shall furnish
to the Motorola Representative a statement summarizing all significant problems
and quality issues reported to Licensee's customer service department for each
Product in the preceding quarter.

 

7.         COSTS

7.1       Except as otherwise
expressly provided herein, Motorola and Licensee shall each bear their own
costs, including, but not limited to, reasonable and necessary travel and
inspection services associated with the inspection and testing of Products for
compliance with the Approved Samples, except that Licensee alone shall bear any
costs associated with the inspection and testing of Products for compliance
with the Approved Samples that are conducted by an independent testing
laboratory as referenced in Section 3.4 and shall bear the cost of the samples
referenced in this Agreement.

 

8.          ROYALTIES

8.1       Licensee agrees to
pay Motorola a royalty equal to a percentage, as shown in Exhibit F for each
Product, of all Net Sales for the Products.  The royalty rate for any Product
other than those in Exhibit C will be determined by written amendment between
Motorola and Licensee. The royalty obligation shall accrue upon the sale of the
Products regardless of the time of collection by Licensee.  For purposes of
this agreement, Products shall be considered "sold" on the date when such
Products are billed, invoiced, shipped or paid for, whichever event occurs
first.  No deductions shall be made for uncollectible accounts.  If the Net
Sales price is expressed in any currency other than United States Dollars, the
royalty rate shall be applied to that currency converted to United States
Dollars based upon the exchange rate that appears in the "Currency Trading"
section of the Eastern Edition of The Wall Street Journal on the last day of
the quarterly period in which the royalties become due.

13

8.2       Licensee shall pay
the royalties based upon Net Sales in quarterly periods ending on the last day
of March, June, September, and December in U.S. Dollars to Motorola. within
fifteen (15) days after the end of each quarterly period less Minimum Royalties
actually received by Motorola for each quarterly period. At the time of the
quarterly royalty payment, Licensee will also furnish to Motorola on forms
provided or approved by Motorola with a statement of Net Sales and number of
units of all Products sold  (whether or not subject to a royalty) during the
immediately preceding quarterly period and statements of other information as
the forms may require.  Such statements will be certified true and correct by a
duly authorized officer of Licensee if Licensee is a corporation or by a
principal of Licensee if Licensee is a partnership or sole proprietor. 
Licensee shall send all payments required by this Section to Motorola at the
address in Section 8.5 and statements required by this Section to the Director
of Trademark Licensing at the address in Section 22.  Neither the expiration
nor the termination of this Agreement shall relieve Licensee from its royalty
payment obligations.      In the event Licensee does not provide Motorola with
payment of the required royalties as provided, Licensee agrees to pay an
additional amount to Motorola equal to Twelve Percent (12%) per annum on all
unpaid royalty balances from the due date of such payment until the date
royalties are paid to Motorola and the corresponding quarterly reports are made
and delivered to Motorola.

8.3      Credits for Products for which royalties were previously paid shall be
made against royalties in the quarter the Product returns are received and
credited to Licensee's customers. 

8.3.1       
Fifteen days
after the close of each quarter during each Sales Year as set forth in Exhibit
F, Licensee shall pay in U.S. Dollars to Motorola a quarterly minimum royalty
amount equal to the minimum royalty for the applicable Sales Year (Minimum
Royalty") divided by the number of whole quarters for such Sales Year. The
Minimum Royalty for Sales Year 1 shall be $375, 000.00.  Motorola and Licensee
shall agree on the Minimum Royalty for Sales Year 2 and Sales Year 3 prior to
the end of the prior Sales Year.  In case the parties are unable to agree to
the Minimum Royalty for Sales Year 2 or Sales Year 3, the Minimum Royalty shall
be calculated as set forth in Exhibit F.

8.3.2       
 Licensee may
reduce the Minimum Royalty due in a quarter by the amount the royalty payment
based on Net Sales paid for the previous quarterly period of the current Sales
Year exceeded the Minimum Royalty for the previous quarterly period.  If the
total royalties actually paid for any one Sales Year equal or exceed the total
Minimum Royalties for that Sales Year prior to the due date of the next
quarterly Minimum Royalty payment for the Sales Year, no quarterly Minimum
Royalty payment is due.  

8.4       Should the Agreement be terminated by Motorola for cause or by Licensee
for convenience under paragraph 10.5 prior to the end of the Term, Licensee
shall pay to Motorola an amount equal to the Minimum Royalty for the then
current Sales Year, or in the last Sales Year of this Agreement, an amount
equal to the remaining Minimum Royalty, if any.  This payment will be in
addition to any prior payment of the Minimum Royalty for that Sales Year, and
shall be paid together with any additional royalty amount due within fifteen (15)
days of the time of termination.   

 

8.5       All payments shall be electronically transferred to
Motorola with all electronic transfer fees to be paid by Licensee at:

Northern
Trust Company

Motorola PCS International

Motorola Account # 32690190

ABA (Routing) # 071000013

Swift Code - CNORUS44

14

8.6       During the term of this
Agreement and for at least five (5) years following the termination or
expiration of this Agreement, Licensee shall maintain at Licensee's principal
office such books and records including but not limited to production,
inventory and sales records (collectively "Books and Records") as are necessary
to substantiate that (i) all statements submitted to Motorola hereunder were
true, complete and accurate, (ii) all royalties and other payments due Motorola
hereunder shall have been paid to Motorola in accordance with the provisions of
this Agreement, and (iii) no payments have been made, directly or indirectly,
by or on behalf of Licensee to or for the benefit of any Motorola employee or
agent who may reasonably be expected to influence Motorola's decision to enter
this Agreement or the amount to be paid by Licensee under this Agreement.  (As
used in this Section, "payment" shall include money, property, services, and
all other forms of consideration.)  All Books and Records shall be maintained
in sufficient form and detail so as to provide adequate factual support for
royalty computation, payments and all other reports required by this
Agreement.  During the term of, and for five (5) years after the termination or
expiration of this Agreement, upon no fewer than ten (10) Business Days notice,
the Books and Records shall be open to inspection, audit, and copy by or on
behalf of Motorola during normal business hours.

8.7       If any examination
reveals that Licensee has underpaid the royalty, Motorola shall so notify
Licensee, specifying the underpayment in reasonable detail.  Licensee shall pay
the shortfall to Motorola within ten (10) days of being notified of the
shortfall. Motorola shall bear the costs and expenses of conducting each
examination. However, if the examination reveals that Licensee has underpaid
the royalty by more than five percent (5%) of the actual amount due Licensee
shall pay to Motorola the shortfall, plus a late fee in an amount of one
percent (1%) of such shortfall for each month or part thereof from the last day
of the quarterly period in which the royalties became due until the date paid.
If the amount of such late fee exceeds the maximum interest rate permitted by
law, such fee shall be reduced to such maximum.  If any examination reveals
that Licensee has overpaid the royalty in respect of any reporting period,
licensee shall so notify Motorola, specifying the overpayment in reasonable
detail. Motorola shall pay the overage to Licensee within ten (10) days of
being notified of the overage.

8.8       Licensee shall pay
any tax (and any resulting interest and penalties), however designated, imposed
solely as a result of the existence or operation of this Agreement including
any tax that Licensee is required to withhold or deduct from payments to
Motorola, except (i) any such tax constituting an income, franchise, gross
receipts, revenue or similar tax imposed upon Motorola by any governmental
entity within the United States proper (the fifty (50) states and the District
of Columbia, Guam and Puerto Rico); and (ii), if the aforesaid office of
Licensee is located in or relocated to a jurisdiction outside of the United
States proper, any foreign tax imposed on Motorola or any of its subsidiaries
if such tax is allowable as a credit against U.S. income taxes of any of such
companies. In the case of taxes imposed pursuant to Section 8.9(ii), Licensee
shall furnish Motorola with any evidence required by United States taxing authorities
to establish that such tax has been paid. 

 

15

 

 

9.          SALES AND MARKETING

9.1       Licensee shall provide Motorola with written descriptions in
such detail as may be requested from time to time by Motorola of Licensee's
marketing and distribution program before
the program's implementation or modification.  Licensee shall not proceed with
the implementation of the initial program or any modification of its marketing
and distribution program without obtaining Motorola's prior approval. 
Motorola's approval of such marketing and distribution programs shall not be
unreasonably withheld or delayed.  

9.2       Licensee agrees to
attend an Annual Review and Planning Meeting with Motorola to review the
current year's performance in comparison with previously projected goals and
objectives and to adopt goals and objectives for the coming year.  Licensee
agrees to develop and present a detailed sales marketing plan with projected
goals and objectives for the coming year commensurate with the forecasted
sales.  The sales marketing plans shall be structured with Motorola.  The
meeting shall take place at a mutually agreed location not later than ninety
(90) days prior to April 1st of each year.   At least sixty (60) days prior to
the annual meeting, each party shall provide the other party with a list of
relevant issues and questions to be addressed, and the other party agrees to
address the issues and questions at the Review and Planning Meeting.  At the
discretion of Motorola, Licensee agrees to attend semi-annual or other required
performance review meetings with Motorola at a mutually agreed upon location.

9.3       Throughout the term of this Agreement, Licensee
agrees to promote the sales of Products in Licensee's business operations and
in retail outlets and distributors in the Territory.  In order to preserve the
value and integrity of
the Trademarks, the parties agree that the Products will be sold only in
channels where the suitability of the trading premises, the customer service
and the competence of the resellers are of sufficient quality and reliability
and are appropriate for the resale of the Products consistent with Motorola's
brand image.  For the avoidance of doubt, the following channels would satisfy
such requirements:  wholesalers, distributors, network operators, department
stores, chain consumer electronics stores, boutique consumer electronics
stores, and general merchandise stores. Motorola reserves the right to
disapprove or withdraw approval of any specific retailer if, in Motorola's
reasonable belief, that retailer does not provide suitable service or
competence or maintain a suitable trading premises, or may otherwise subject
the Trademarks to devaluation or disrepute in any way.

9.4      Licensee agrees not to offer, without prior written approval from
Motorola, branded products that are identical in function and in appearance to
Products, except for the Trademarks, in the same retail outlets or distributors
with the Products. Motorola acknowledges that the foregoing restriction is
intended only to prohibit Licensee from offering items that are identical to
the Products under a different brand name, and is not intended to prohibit
Licensee from offering non-Trademarks branded products generally. In the event
the parties mutually agree to customizations that differentiate the Products by
including in appearance elements that create an identity associated with the
Products, Licensee agrees to use and limit such customizations to the Products
unless Motorola agrees in writing to their use for other products. Neither party
assigns to the other party any rights in its industrial designs, technology,
and/or intellectual property in and associated with the Products unless
specifically agreed to in writing by the owner.

 

16

 

 

10.       TERM AND TERMINATION

10.1     Unless
sooner terminated in accordance with this Agreement, the license and rights
granted under this Agreement shall commence on the Effective Date of the
Agreement, and shall continue in effect until December 31, 2007.  The parties
may renew or extend the Term of this Agreement by mutual consent.

10.2     Without prejudice to any
other rights that Motorola may have, including without limitation those under
Section 21, Motorola may at any time give notice of termination of this
Agreement effective immediately:

10.2.1  If Licensee shall be unable to pay its obligations when due,
shall make any assignment for the benefit of creditors, shall file a voluntary
petition in bankruptcy, shall be adjudicated bankrupt or insolvent, shall have
any receiver or trustee in bankruptcy or insolvency appointed for its business
or property, or shall make an assignment for the benefit of creditors;

10.2.2  If Licensee manufactures, sells,
markets, distributes or uses any Products or Product Materials without
Motorola's approval as provided for by this Agreement or continues to
manufacture, sell, market, distribute or use any Products or promotional or
packaging material relating to the Products after receipt of notice from
Motorola disapproving such items in accordance with the terms of this
Agreement;

10.2.3  If Licensee
breaches any provision of this Agreement relating to the unauthorized assertion
of rights in the Trademarks;

10.2.4  If Licensee
breaches any provision of this Agreement prohibiting Licensee from directly or
indirectly  assigning, transferring, sublicensing, delegating or otherwise
encumbering this Agreement or any of its rights or obligations.  

10.2.5 If reasonable
grounds for insecurity arise with respect to Licensee's performance of this
Agreement, Motorola may in writing demand adequate assurance of due
performance, specifying in reasonable detail the grounds for insecurity.  If
Motorola does not receive such written assurance within ten (10) days
after the date of its request therefore or within such other shorter period of
time as Motorola may reasonably designate under the then existing
circumstances, Motorola may immediately terminate this Agreement.

10.3     Without prejudice to
any other rights that Motorola may have, Motorola shall have the right to
terminate this agreement for any material breach ninety (90) days after sending
by commercial overnight carrier a written notice to Licensee that specifies the
alleged breach in reasonable detail unless the breach or breaches are cured in
the reasonable determination of Motorola within such ninety (90) day period. 
Material breaches include but are not limited to the following:

10.3.1 If Licensee shall
fail for one hundred and twenty (120) consecutive days to continue the bona
fide distribution and sale of the Products in commercially reasonable
quantities throughout the Territory;

10.3.2  If Licensee shall fail to make any payment due hereunder or any
furnish any statement required hereunder;

 

17

            10.3.3  If the quality
in any Products has reached unacceptable levels pursuant to Section 3 and a
mutually agreeable action plan to remedy the defects has not been established
within ten (10) Business Days from notice by Motorola specifying in reasonable
detail the purported defects or if subsequent quality reports reveal that
within such 90-day period the defect rates have not been reduced to the
acceptable standard;

10.3.4  If Licensee
fails to obtain or maintain insurance as required by the Section 15 of this
Agreement;

10.3.5  If Licensee
breaches any provision of this Agreement, relating to the Territory;

10.3.6  Motorola's
reasonable determination that significant customer satisfaction issues have
arisen with any Product;  

10.3.7  Licensee fails
to enforce or terminate a Manufacturer's Agreement against a breaching Approved
Manufacturer as required in Section 3.10 or 3.11 or such breaching Approved
Manufacturer fails to cure such material breach; or

10.3.8  Licensee arranges
for manufacture by third parties (other than Approved Suppliers) who have not
been approved and entered into a Manufacturer's Agreement.

10.4 Without prejudice to any other
rights Licensee may have, including without limitation those in Section 21,
Licensee may at any time give notice of termination effective immediately:

            10.4.1  If any of the
Trademarks are decided by a court of Competent jurisdiction to infringe the
rights of a third party; or

10.4.2 If Motorola shall be unable to pay
its obligations when due, shall make any assignment for the benefit of
creditors, shall file a voluntary petition in bankruptcy, shall be adjudicated
bankrupt or insolvent, shall have any receiver or trustee in bankruptcy or
insolvency appointed for its business or property, or shall make an assignment
for the benefit of creditors.

10.5 Licensee may terminate this
Agreement for convenience at any time, with or without cause, by giving
Motorola ninety (90) days prior written notice.

10.6 Without prejudice to any other
rights that Licensee may have, including, without limitation, those under
Section 21, Licensee shall have the right to terminate this Agreement:

10.6.1  for any material breach by Motorola
ninety (90) days after mailing written notice to Motorola that specifies the
alleged breach in reasonable detail, unless the breach or breaches are cured in
the reasonable determination of Licensee within such ninety-day period;

 

18

 

 

11.       POST-TERMINATION
AND EXPIRATION RIGHTS AND OBLIGATIONS

11.1     If this Agreement is terminated for
any cause under Section 10.2, Licensee and Licensee's receivers,
representatives, trustees, agents, administrators, successors or permitted
assigns shall have no right after the effective date of termination to
manufacture, sell, ship, market or distribute Products or to use any
promotional and packaging material relating to the Products. Any Products not
sold, shipped, and distributed by Licensee prior to termination must be
destroyed or reprocessed so that the Trademarks are no longer present in whole
or in part on the Products or on their Product Materials.  Upon Motorola's
request, Licensee shall provide evidence reasonably satisfactory to Motorola of
such destruction or reprocessing of remaining Products or Product Materials.
Licensee's final statement and payment of royalties, which shall include the
difference, if any, between all royalties based upon Net Sales for the
termination Sales Year and the full Minimum Royalty, to the extent not paid,
for the termination Sales Year shall be received by Motorola within thirty (30)
days after the effective date of termination.  Licensee shall send all payments
and statements required by this Section 11.1 in accordance with Section 8.5.

11.2     After expiration of
the initial term and any renewal term(s) of this Agreement or the termination
of this Agreement by Motorola under any provision other than Section 10.2,
Licensee may sell, ship, market and distribute Products in the Territory that
are on hand or in the process of manufacture at the date of expiration or at
the time notice of termination is received for a period of ninety (90) days
after the date of expiration or the date of notice of termination, as the case
may be, provided that the royalties with respect to that period are paid and
the appropriate statements for that period are furnished. Motorola shall have
the right, but not the obligation, to purchase all or part of Licensee's inventory
of Products at cost plus fifteen percent (15%) upon expiration of the ninety
(90) day sell-off period permitted by this Section 11.2. Unless purchased by
Motorola, any Products not sold, shipped, and distributed by Licensee within
this ninety (90) day period must be destroyed or reprocessed so that the
Trademarks are no longer present in whole or in part on the Products or on
their Product Materials. Upon Motorola's request, Licensee shall provide
evidence reasonably satisfactory to Motorola of such destruction or
reprocessing of remaining Products or Product Materials.  After termination of
this Agreement under any provision other than Section 10.2, Licensee shall make
the next quarterly statement and payment as required by Section 8 and Licensee
shall make a final statement and payment of royalties including the difference,
if any, between all royalties based upon Net Sales and the prorated minimum
royalty for the termination Sales Year to the extent not already paid to
Motorola no later than one hundred (100) days after the effective date of
termination.  For the avoidance of doubt, the passage of the 90-day period
referred to in this Section 11.2, and the sale, shipment, marketing or
distribution of Products by Licensee during such period, shall not be the basis
of payment of Minimum Royalty attributable to such period.  Licensee shall send
all payments and statements required by this Section 11.2 in accordance with
Section 8.5.

 

 

19

11.3     After the expiration
or termination of this Agreement and except as provided in Section 11.2, all
rights granted to Licensee under this Agreement shall forthwith revert to
Motorola, and Licensee shall refrain from further use of the Trademarks or any
further reference to the Trademarks, either directly or indirectly, or from use
of any marks or designs similar to the Trademarks in connection with the
manufacture, sale, marketing or distribution of Licensee's products.  Licensee
also shall turn over to Motorola all molds, silk-screens, and other materials
that reproduce the Trademarks or shall give evidence satisfactory to Motorola
of their destruction.  Licensee shall be responsible to Motorola for any
damages caused by the unauthorized use by Licensee or by others of such molds,
silk-screens or reproduction materials that are not turned over to Motorola. 

11.4     Licensee acknowledges that its failure to cease the manufacture, sale,
marketing or distribution of the Products and the Product Materials at the
termination or expiration of this Agreement, except as provided in Section 11.2,
will result in immediate and irreparable damage to Motorola and to the rights
of any subsequent licensee of Motorola.  Licensee acknowledges and admits that
there is no adequate remedy at law for failure to cease such activities, and
Licensee agrees that in the event of such failure, Motorola shall be entitled
to injunctive relief and such other relief as any court with jurisdiction may
deem just and proper.

11.5     Within twenty (20) days after expiration or within ten (10) days after
notice of termination of this Agreement, as the case may be, Licensee shall
deliver to Motorola a written report indicating the number and description of
the Products and Product Materials that it had on hand or in the process of
manufacture as of the date of expiration or at the time termination notice is
received.  Motorola may conduct a physical inventory in order to verify such
report.  If Licensee fails to submit the required written report or refuses to
permit Motorola to conduct such physical inventory, Licensee shall forfeit its
rights under this Agreement to dispose of such inventory.  In addition to such
forfeiture, Motorola shall have recourse to all other available remedies.

 

12.       CONFIDENTIALITY AND
INTELLECTUAL PROPERTY

12.1     Motorola's
"Confidential Information" shall mean specifications, property, data, drawings,
schematics, diagrams, dimensions, prints, reprints, information, business and
financial information, customer lists and customer prospects, vendor lists and
vendor arrangements, pricing and sales information and all communications
relating to any of the foregoing pursuant to this Agreement.  Products created
by Motorola for Licensee under this Agreement, submitted or presented by
Motorola to Licensee under this Agreement, or jointly developed by the parties
are deemed Motorola's Confidential Information.

12.2     Licensee's
"Confidential Information" shall mean Licensee's business and financial
information, information concerning Licensee's products, including without
limitation the Products, and related specifications, property, data, drawings,
schematics, diagrams, dimensions, prints and reprints, Licensee's decoration
process, including, without limitation, specifications, data, drawings, 
creative and developmental work relating to product offerings, technical
information, diagrams, schematics, Licensee's customer lists and customer
prospects, vendor lists and vendor arrangements,  supply strategies, market
strategies, pricing and sales information, and Licensee's customer information
provided to Motorola by Licensee or to which Motorola otherwise gains access,
and all communications relating to any of the foregoing pursuant to this
Agreement.  Products created by Licensee under this Agreement and submitted and
presented to Motorola under this Agreement for approval, are deemed Licensee's
Confidential Information.

 

20

12.3     Each
of the parties agrees and agrees to cause its affiliates, agents and
contractors to agree to maintain the confidentiality of the other party's
Confidential Information whether furnished in oral, visual, written and/or
other tangible form including electronic form, and not disclose such
Confidential Information to any third party, except as authorized by the other
party in writing, prior to such disclosure.  Each party further agrees to keep
confidential the terms of this Agreement; except as required under applicable
reporting requirements pursuant to the Federal securities laws); provided,
however, that the parties shall issue a joint press release regarding this
Agreement in a form, and at such time, as is mutually agreed upon by the
parties in writing. 

12.4     Each
of the parties agrees to restrict disclosure of the other party's Confidential
Information to its employees and contractors who have a "need to know" such
information strictly in connection with the performance of their respective
obligations pursuant to this Agreement. Each of the parties agrees that the
other party's Confidential Information shall be handled with the same degree of
care that it applies to its own Confidential Information (but in no event less
than reasonable care) and shall not be exported directly or indirectly to any
restricted or prohibited country set forth in Section 13 or such other
restricted or prohibited countries as may be designated by the United States
Department of Commerce except in compliance with the regulations of the Office
of Export Control for the United States Department of Commerce.

12.5     Licensee
is the "Receiving Party" with respect to Motorola's Confidential Information
and Motorola is the "Receiving Party" with respect to Licensee's Confidential
Information. The parties agree to exclude from these obligations of
confidentiality any Confidential Information that the Receiving Party can
demonstrate: (i) is wholly independently developed by the Receiving Party
without the use, directly or indirectly, of the other party's Confidential
Information; or (ii) is known or becomes known to the general public without
breach of this Agreement; or (iii) was known to the Receiving Party without
confidential limitation at the time of disclosure by the other party as
evidenced by documentation in the Receiving Party's possession; or (iv) is
approved for release by written authorization of the other party, but only to
the extent of and subject to such conditions as may be imposed in such written
authorization; or (v) is disclosed in response to a valid order to a court,
regulatory agency, or other governmental body in the United States or any
political subdivision thereof, but only to the extent and for the purposes
stated in such order; provided, however, that the Receiving Party shall first
notify the other party in writing of the order and cooperate with the other
party if the other party desires to seek an appropriate protective order; or
(vi) is received rightfully and without confidential limitation by the
Receiving Party from a third party. 

21

12.6     In
the course of its relationship with Motorola, Motorola may give Licensee access
to Motorola's facility including its manufacturing, distribution or accelerated
life testing area.  Licensee agrees that the manufacturing, handling or testing
techniques, processes, methodologies and know how embodied in equipment and
equipment arrangements; materials and equipment supplier names and vendor
arrangements and strategies; and products under manufacture, handling or
testing in Motorola's facility are deemed to be Motorola Confidential
Information, even if not identified as confidential at the time of disclosure
and confirmed in correspondence.  In the course of its relationship with
Licensee, Licensee may give Motorola access to Licensee's facility including
its manufacturing, distribution or accelerated life testing area.  Motorola
agrees that the manufacturing, handling or testing techniques, processes,
methodologies and know how embodied in equipment and equipment arrangements;
materials and equipment supplier names and vendor arrangements and strategies;
and products under manufacture, handling or testing in Licensee's facility are
deemed to be Licensee Confidential Information, even if not identified as
confidential at the time of disclosure and confirmed in correspondence.  

12.7     Upon
termination of this Agreement, all Confidential Information transmitted to the
Receiving Party by the other party in record bearing media or other tangible
form including electronic form, and any copies thereof made by the Receiving
Party shall be either destroyed and its destruction certified in writing or, at
the other party's written request, returned to the other party, except that the
Receiving party shall be entitled to retain a secure copy of the other party's
Confidential information for archival purposes only.  Additionally, Motorola
agrees to return Licensee's Confidential Information upon Licensee's written
request, and Licensee agrees to return Motorola's Confidential Information upon
Motorola's written request.

12.8      Licensee agrees that it will not in any manner use its knowledge of
Motorola business or Confidential Information for the benefit of any other
party or divulge to others information or data concerning Motorola's business
affairs, including the names of customers, names of employees, number or
character of contracts, marketing and supply strategies and prices, vendor
lists and arrangements, terms or particulars of Motorola's business.  Licensee
will, in all things and in good faith, protect the good will of Motorola's
business and keep confidential its knowledge of such business affairs acquired
prior to and during the terms of this Agreement. Motorola agrees that it will
not in any manner use its knowledge of Licensee business or Confidential
Information for the benefit of any other party or divulge to others information
or data concerning Licensee's business affairs, including the names of
customers, names of employees, number or character of contracts, marketing and
supply strategies and prices, vendor lists and arrangements, terms or
particulars of Licensee's business.  Motorola will, in all things and in good
faith, protect the good will of Licensee's business and keep confidential its
knowledge of such business affairs acquired prior to and during the terms of
this Agreement.

13.       EXPORT

13.1     Licensee
agrees and represents that it is aware of all pertinent export laws and
regulations and will not violate them in any material respect. To the extent
that Licensee exports, transports or manufactures or has manufactured any
products or technologies in any way connected to the Trademarks, Licensee
hereby assures Motorola that it does not intend to and will not, without the
prior written consent of the Office of Export Licensing of the U.S. Department
of Commerce, P.O. Box 273, Washington, D.C. 20230, export, transport,
manufacture or have manufactured directly or indirectly (i) Products or other
items in any way associated therewith or (ii) any technical information
provided hereunder in, to or by (a) any individuals or entities listed in the
Table of Denial Orders as published from time to time in Supplement No.2 to
Part 764 of the above referenced regulations, (b) embargoed countries or
foreign nationals of such countries, as may be changed from time to time, under
U.S. export laws and regulations or (c) controlled countries and foreign
nationals of such countries to the extent such products and technologies are
defined as controlled technologies in the U.S. Export Administration
Regulations Part 774. Embargoed and controlled countries are defined in the
U.S. Export Administration Regulations Parts 740 Supplement No.1, 746 and 772
and currently include Cuba, Iran, Libya, North Korea, Sudan and Syria. 

22

14.       REPRESENTATIONS AND
WARRANTIES

14.1     Motorola represents
and warrants that at all times:

            14.1.1   it has the
power to grant a license of the Trademarks in the Territory and that such grant
is in compliance with applicable law and does not infringe the rights of any
third party.

            14.1.2  Motorola,
at its expense, shall be responsible for obtaining and maintaining all
licenses, permits and approvals necessary for Motorola to maintain its rights
in the Trademarks.

No other warranties, express or
implied, are given by Motorola, and all other warranties, express or implied,
are expressly disclaimed by Motorola.

14.2      Licensee represents
and warrants that at all times:

14.2.1        Subject to the representations in Section 14.1, Licensee has
and shall maintain all rights and licenses needed to sell the Products and the
Products do not infringe any patent, copyright, mask work right, moral right,
trademark, service mark, trade secret and/or all other intellectual property rights
and/or similar rights of any third party. Licensee is solely responsible for
all royalties, fees or other payments to secure such rights and licenses for
end user customers.

14.2.2       Licensee shall secure
and maintain all certifications and requirements to sell the Products and
Licensee shall affix all labels on the appropriate area of each Product
regarding such certifications and requirements. Licensee shall provide written
evidence of such certifications and approvals to Motorola upon Motorola's request.

14.2.3       All Products are new,
and do not contain anything used. 

14.2.4       Product Materials shall
not claim or suggest that any Products improve the health of users, have
therapeutic capabilities, or can help the users to avoid injuries that otherwise
might occur through the use of alternative products.

14.2.5       All claims made in
connection with the Products and Product Materials are accurate, complete in
all material respects and have been substantiated prior to use in advertising,
promotion or on the Products or Product Materials.

14.2.6       Licensee, at its
expense, shall be responsible for obtaining and maintaining all licenses,
permits and approvals that are required by all appropriate governmental
authorities, with respect to Licensee's compliance with its obligations under
this Agreement, excluding any licenses, permits or approvals necessary for
Motorola to maintain its rights in the Trademarks, and to comply with any
requirements of such governmental authorities for the registration or recording
of this Agreement and for making payments hereunder. Licensee shall furnish to
Motorola within thirty (30) days of receipt of same, written evidence from such
governmental authorities of any such licenses, permits, clearances,
authorizations, approvals, registration or recording.

 

23

14.2.7       All Products are safe
for any use consistent with the warranties, specifications and requirements of
this Agreement.

14.2.8       All Products are of
merchantable quality, and conform to the specifications and requirements of quality
in materials, design, and workmanship in this Agreement.

14.3     Each party hereto
warrants that such party's performance hereunder will be in compliance with all
applicable federal, state and local laws, orders, rules and regulations,
whether domestic or foreign.  Each party hereto warrants that its execution,
delivery and performance of this Agreement has been authorized by all necessary
corporate action and that this Agreement has been duly authorized, executed and
delivered.

 

15.       INDEMNITIES AND INSURANCE

15.1     Licensee acknowledges that, except
as set forth in Section 15.2, it will have no claims against Motorola for any
damage to property or injury to persons arising out of the operation of
Licensee's business.  Licensee agrees to indemnify, hold harmless and defend
Motorola , its subsidiaries and customers, with legal counsel acceptable to
Motorola, from and against all third-party suits, actions, claims, damages,
liabilities, costs and expenses, including attorneys fees, court costs and other
legal expenses, arising out of or connected with the Products, Licensee's
methods of manufacturing, marketing, selling, distributing or use of the
Products, the promotional or packaging material relating to the Products, or
any breach by Licensee of any provision of this Agreement or of any warranty
made by Licensee in this Agreement.  As a condition of this indemnity Motorola
agrees to give Licensee written notice of any claim within ten (ten) days of
receipt by Motorola and agrees to cooperate with Licensee in connection with
the defense and any related settlement negotiations.  Licensee shall bear full
responsibility for the defense (including any settlements) of any such claim;
provided, however, that: (i) Licensee shall keep Motorola informed of, and consult
with Motorola in connection with the progress of such litigation or settlement;
and (ii) Licensee shall not have any right, without Motorola's prior written
consent, to settle any such claim if such settlement arises from or is part of
any criminal action, suit or proceeding or contains a stipulation to or
admission or acknowledgement of, any liability or wrongdoing (whether in
contract, tort, or otherwise) on the part of Motorola or any Motorola
subsidiary or does not contain a complete and immediately effective release
from all claims and liability. 

24

15.2      Motorola agrees to
indemnify, hold harmless and defend Licensee from and against all third-party
suits, actions, claims, damages, liabilities, costs and expenses, including
attorney's fees, court costs and other legal expenses, arising out of or
relating to (i) infringement of the trademarks or copyrights of any third party
by the Trademarks so long as such claims arise from Licensee's promotion or
sale of the Products in the Territory and Licensee's use of the Trademarks  in
accordance with the terms of this Agreement or (ii) or any breach by Motorola
of any provision of this Agreement or of any warranty made by Motorola in this
Agreement.  Motorola shall bear full responsibility for the defense (including
any settlements) of any such claim; provided, however, that: (i) Motorola shall
keep Licensee informed of, and consult with Licensee in connection with the
progress of such litigation or settlement; and (ii) Motorola shall not have any
right, without Licensor's prior written consent, to settle any such claim if
such settlement arises from or is part of any criminal action, suit or
proceeding or contains a stipulation to or admission or acknowledgement of, any
liability or wrongdoing (whether in contract, tort, or otherwise) on the part
of Licensee or any subsidiary of Licensee or does not contain a complete and
immediately effective release from all claims and liability. As a condition to
this indemnity, Licensee agrees to give Motorola written notice of any claim
within ten (10) days business days of receipt by Licensee and agrees to
cooperate with Motorola in the defense and any related settlement negotiations.

15.3      During the term of
the Agreement, Licensee will maintain at its own expense, commercial general
liability ("CGL") insurance including contractual liability coverage, products
and completed operations in an amount not less than Three Million Dollars     
($ 3, 000,000.) per occurrence for bodily injury, personal injury and property
damage liability.  The insurance will be placed with an insurer acceptable to
Motorola, licensed for the jurisdiction in which this Agreement is performed
and having a Best's Rating not less than A-VII.  The CGL policy will name
Motorola, Inc. as an additional insured and provide a minimum thirty (30) days
prior written notice of cancellation or material change.  Licensee shall
furnish Motorola within thirty (30) days after execution of this Agreement or,
if earlier, prior to the sale of the Products, with a certificate of insurance
stating thereon the limits of liability, the period of coverage, the parties
insured (including Licensee and Motorola), and the insurer's agreement not to
terminate or materially modify such insurance without endeavoring to notify Motorola
in writing at least ten (10) days before such termination or modification. 
Coverage provided for Motorola shall be primary, and any insurance maintained
by Motorola shall be in excess and not contributing with any insurance provided
by Licensee.  Coverage shall be on a claims made basis.  Motorola shall not be
responsible for the payment of the premiums, charges, taxes, assessments, or
other costs for the product liability insurance.

15.4      The existence of the
product liability insurance shall not mitigate, alter, or waive the indemnity
provisions of Section 15.1. 

16.        DISPUTE RESOLUTION
 

16.1      The
Parties will attempt to settle any claim or controversy relating to this
Agreement through negotiation in good faith and a spirit of mutual cooperation.
If those attempts fail to achieve a settlement, then the dispute will be
mediated by a mutually acceptable mediator to be chosen by the Parties within
forty-five (45) days after written notice by either Party demanding mediation.
Neither Party may unreasonably withhold its consent to the selection of a
mediator, and the Parties shall share the costs of mediation equally. The
non-binding mediation hearing shall be conducted within forty-five (45)
calendar days after the selection of the mediator. Each Party shall bear its
own attorney's fees and other costs. Any mediation shall be conducted in the
English language.

16.2       Any dispute that cannot be resolved
between the Parties through negotiation or mediation within six (6) months of
the date of the initial demand for mediation by one of the
Parties may then be submitted to the courts for resolution. The use of any
mediation procedures will not be construed under the doctrines of laches,
waiver or estoppel to affect adversely the rights of either Party. Nothing in
this Section 16 shall be interpreted to prevent either Party from resorting to
judicial proceedings if interim relief from a court in the nature of a
preliminary or temporary injunction is necessary to prevent serious and
irreparable injury to that Party or to others. In addition, nothing in this
Section 16 shall be construed as applying to disputes regarding the
Intellectual Property Rights (including Confidential Information) or trademarks
of either party.

25

 17.       
FORCE MAJEURE

17.1      The terms of this Agreement
are binding upon the parties hereto except where prevented, delayed or
interfered with by causes beyond the reasonable control and without the fault
or negligence of the non-performing party, including, without limitation, riot,
war, or hostilities between nations, civil war or severe domestic instability
in any nation in the Territory or place of manufacture of the Products,
governmental regulation (other than action taken in response to Motorola's or
Licensee's violation or failure to act with respect to any law or governmental
regulation, in which case the party at fault shall not be permitted to claim
the benefit of this Section 17), acts of God, fire, accidents, banking
moratorium or suspension of the commercial banking system in any nation in the
Territory or place of manufacture of the Products, significant acts of
terrorism and the results thereof, strikes or earthquakes.

17.2     The party affected by force
majeure shall give notice to the other party of said force majeure
event promptly after the occurrence thereafter, stating therein the nature of
suspension of performance and reasons therefor.  Such party shall use
commercially reasonable efforts to resume performance as soon as reasonably
possible under the circumstances giving rise to the claim of force majeure. 
Upon restoration of the affected party's ability to perform its obligations
hereunder, the affected party will give immediate notice to the other party.

17.3     If the force
majeure condition that prevents a party's performance hereunder shall
continue for a period of six (6) consecutive months, and there shall be no
reasonable prospect for the immediate cure thereof despite the commercially
reasonable efforts of the affected party to cure the same, then either party
shall have the right to terminate this Agreement in its entirety and without
liability upon ninety (90) days prior notice to the other party.

 

18.       LIMITATION OF
LIABILITY

18.1     Except for third party
damages included in settlements and judgments subject to Section15.2 Motorola
shall not be liable to Licensee for lost profits, or consequential, indirect,
incidental, special or punitive damages, even if advised in advance of the
possibility of such damages.

19.       INTELLECTUAL
PROPERTY

19.1     No grant or transfer of any Motorola's Intellectual Property Rights to
Licensee is given or intended under this agreement, including any license
implied or otherwise, except as expressly provided in Section 2 of this
Agreement.

26

 

19.2     As between Motorola and Licensee Motorola owns and, upon creation shall
own, all rights in the Trademarks, the trade dress associated with the Product
and the copyrights and trade dress in the Product Materials and any Derivative
Works created from them. Further, Motorola owns and upon creation shall own the
ornamental designs, industrial designs, design patents, and trade dress in any
Product designed specifically to fit a MOTOROLA product specifically and
uniquely or designed based upon a Motorola design.  Licensee shall cooperate
and shall execute all papers reasonably requested by Motorola to effect
registration, maintenance and renewal of these rights, at the sole expense of
Motorola.

19.3     Except as stated in Section 19.2, as between Motorola and Licensee,
Licensee owns and, upon creation shall own, all rights in the ornamental
designs, industrial designs and design patents associated with the Products and
any Derivative Works created from them.  Motorola shall cooperate and shall
execute all papers reasonably requested by Licensee to effect registration,
maintenance and renewal of these rights, at the sole expense of Licensee.

20.       PRESS RELEASES

20.1     Except as provided
in Section 12.3, Licensee shall make no press releases concerning the business
relationship or license granted in this Agreement or the introduction or sales
of Products without Motorola's written agreement as to the form and content of
the proposed press release.   Motorola's approval of such press releases shall
not be unreasonable withheld or delayed.  Motorola agrees and acknowledges that
Licensee may report on sales results pursuant to the license granted in this
Agreement pursuant to its obligations to file periodic reports under the
Securities Exchange Act of 1934, in the normal course of compliance with such
obligations.

21.       ETHICS AND CONFLICTS OF
INTEREST.  

21.1     Both
parties will refrain from activities that: (i) are illegal, unethical; (ii)
might bring either party into disrepute; or (iii) might constitute or represent
a serious conflict of interest or that might give the appearance of impropriety.
Both parties will cooperate fully in any investigation or evaluation of such
matters. Breach of this obligation by either party will entitle the
non-breaching party to terminate this Agreement without notice. 

22.       NOTICES

22.1     Any notice required or
permitted to be given under this Agreement shall be in writing and shall be
directed by one party to the other at its respective address as follows unless
otherwise provided for in this Agreement:

		 	Licensor:	

Carlos Coroalles

			
	 	 	

Director
of Trademark Licensing

			
	 	 	

Motorola,
Inc.

			
	 	 	

600
North U.S. Highway 45

			
	 	 	

Libertyville,
Illinois 60048-1286

			
	 	 	

United States of America

			

27

and to:

Scott
Offer

Corporate
Vice President 

Law
Department, Personal Communications Sector

Motorola,
Inc.

600 North
U.S. Highway 45

Libertyville,
IL 60048-1286

Licensee:          Jerome
E. Ball

Chairman
and Chief Executive Officer

Forward
Industries

1801
Green Road, Suite E.

Pompano
Beach, FL 33064

Phone:
954-360-6420

FAX:
954-419-9735

EMAIL: jball@forwardindustries.com

And to:

                        Steven
A. Malsin

Attorney
at Law

237
Upper Shad Road

Pound
Ridge, NY 10576

                        

                                                  

22.2     Any notice required or
permitted to be given under this Agreement shall be deemed to have been
received (i) when delivered personally; (ii) when sent by confirmed facsimile
or e-mail except for notices that relate to default provisions; (iii) five (5)
days after having been sent by registered or certified mall, return receipt
requested, postage prepaid; or (iv) one business (1) day after deposit with a
commercial overnight carrier with written verification of receipt.

22.3     Either party may
change the address to which notices or requests shall be directed by written
notice to the other party, but such written notice to be effective must be
received by the other party at least thirty (30) days before the effective date
of the change of address.

22.4     A License Reference
Number will be assigned to this Agreement by Motorola upon execution and shall
be communicated to Licensee by written notice.  This number should be included
in all communications including wire transfer payments, royalty reports, tax
credit certificates, letters, faxes and e-mail messages.

22.5     In addition to all
other notices or reporting requirements specified in this Agreement, the Licensee shall
supply an information report complying with the reporting requirements as set
forth in Exhibit I.

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23.       ASSIGNMENT
OF RIGHTS AND SUBLICENSE

23.1     The benefit of this
Agreement shall be personal to Licensee who shall not, without the prior
consent in writing of Motorola, assign its rights, or delegate its duties
hereunder, nor grant or purport to grant any sublicense in respect to the
Trademarks, to third parties. 

23.2     Notwithstanding the
above, Licensee shall have the right to assign its rights and to delegate its
duties under this Agreement, with Motorola's prior written consent, which shall
not be unreasonably withheld or delayed, to wholly-owned subsidiaries of
Licensee. In the event that Licensee undergoes a substantial change of
ownership, whether or not such a change results from a merger, acquisition,
consolidation or otherwise, Licensee shall have the right to assign its rights
and to delegate its duties to such new owner under this Agreement, with
Motorola's prior written consent, which shall not be unreasonably withheld or
delayed, provided that the substantial change of ownership does not result in a
substantial change in the nature of the Licensee's business, a substantial
change in nature including but not limited to, a change in product mix, pricing
structure, financial condition or method of doing business. However, in any
instance, Licensee and its assignee shall remain ultimately liable to Motorola
for all of the obligations assumed by it under the terms of the Agreement.

24.       FREEDOM OF
ACTION

24.1     Nothing in this Agreement shall be construed as prohibiting or
restricting Motorola or its subsidiaries from independently developing, having
developed independently, acquiring, licensing, distributing or marketing
products, services and other materials which are competitive in any form with
the Products. Licensee agrees and acknowledges that it shall not hold Motorola
liable for any lost sales or revenues in respect to the sales performance of
the Products, regardless of the reason for such lost sales or revenues
including, but not limited to, Motorola's direction in the appearance, function
or marketing of the Products.

24.2     Licensee acknowledges
the license granted hereunder is non-exclusive and that Motorola may, from time
to time produce, distribute, advertise, promote and/or sell, or issue licenses
to other licensees to produce, distribute, advertise, promote and/or sell,
products in the Licensed Territory that are similar or identical to the 
Products.  Notwithstanding the above, Motorola hereby agrees that in connection
with the production, distribution, advertisement, promotion and sale of
products in the  Territory that are: (1) either Products and/or similar or identical
to the Products, and (ii) initiated or requested by the Companion Products
Group of Motorola's PCS Sector or any successor group thereto,  Motorola shall
first afford Licensee the opportunity and right of first refusal to so produce,
distribute, advertise, promote or sell the same.  Licensee agrees and
acknowledges that this right of first refusal shall not apply to products
initiated or requested by any other Motorola business group or Sector,
including, but not limited to, its iDen phone Group.  In the event Licensee is
unwilling or unable to produce, distribute, advertise, promote or sell a
proposed product(s), or a customer, distributor or retailer objects, or in
Motorola's reasonable discretion, is likely to object, to doing business with
or purchasing from Licensee, then the parties hereby agree that Motorola may
then either offer a third party the unfettered right to so produce, distribute,
advertise, promote or sell the proposed product(s), or produce, distribute,
advertise, promote or sell the proposed product(s) itself.  Licensee shall
respond to any such offer to produce, distribute, advertise, promote or sell
the aforesaid within a ten (10) business days. 

29

 

25.       APPROVALS

25.1    
Any approval required by this Agreement to be obtained from Motorola must be in
writing and may be withheld by Motorola for any reason deemed reasonable and
justifiable in the sole determination of Motorola.  If approval is not
delivered in writing to the Licensee within fifteen (15) business days of
submission of a request for approval, the request for approval shall be deemed
to be denied.

26.       WAIVER
OF DEFAULT OR OTHER RIGHTS

26.1     The failure of
Motorola to insist in any one or more instances of the performance of any term,
obligation or condition of this Agreement by Licensee or to exercise any right
or privilege herein conferred upon Motorola shall not be construed as
thereafter waiving such term, obligation, or condition, or relinquishing such
right or privilege, and the acknowledged waiver or relinquishment by Motorola
of any default or right and shall not constitute waiver of any other default or
right.

27.       SEVERABILITY

27.1     If any provision of
this Agreement shall be determined to be illegal and unenforceable by any court
of law or any competent governmental or other authority, the remaining
provisions shall be severable and enforceable in accordance with their terms so
long as this Agreement without such terms or provisions does not fail of its
essential purpose or purposes.  The parties will negotiate in good faith to
replace any such illegal or unenforceable provision or provisions with suitable
provisions, which will maintain the economic purposes and intentions of this
Agreement.

28.       SECTION
HEADINGS

28.1     The captions for each
Section have been inserted for the sake of convenience and shall not be deemed
to be binding upon the parties for the purpose of interpretation of this
Agreement.

29.       EXHIBITS

29.1    All references to
"Exhibit" or "Exhibits" herein shall mean those Exhibits A through I attached
to this Agreement, which Exhibits are hereby incorporated into this Agreement
as though fully set forth herein.

30

 

 

30.       SURVIVAL

30.1     Licensee's obligations and
agreements under Sections 5,  8, 10, 14, 15, 18, 21, 32 and 33 shall survive the termination
or expiration of this Agreement.  Motorola's obligations and agreements under
Sections 10, 11, l2, 14, 15, 18, 19, 21, 32, 33 and 34 shall survive the
termination or expiration of this Agreement.

31.       TIME
IS OF THE ESSENCE

31.1     Time
is of the essence with respect to the obligations to be performed under this
Agreement.

32.       RIGHTS
CUMULATIVE

32.1     Except
as expressly provided in this Agreement, and to the extent permitted by law,
any remedies described in this Agreement are cumulative and not alternative to
any other remedies available at law or in equity.

33.       ENTIRE
AGREEMENT

33.1     The provisions of this
Agreement contain the entire agreement between the parties relating to use by
Licensee of Trademarks on Products, and on Product Materials, and supersede and
cancel all prior provisions, negotiations, agreements and commitments (whether
oral or in writing) with respect to the subject matter hereof. This Agreement
shall be interpreted to achieve the objectives and intent of the parties as set
forth in the text and factual recitals of the Agreement. It is specifically
agreed that no evidence of discussions during the negotiation of the Agreement
or drafts written or exchanged may be used in connection with the
interpretation or construction of this Agreement. This Agreement may not be
released, discharged, abandoned, changed or modified in any manner except by an
instrument in writing signed by the parties. In the event of any conflict
between the provisions of this Agreement and provisions in any other agreement
with Licensee, the provisions of this Agreement shall prevail.

34.       GOVERNING LAW

34.1     This Agreement is deemed to be executed in the State of Illinois and the
construction and performance of this Agreement will be construed and
interpreted according to the substantive laws of that State without regard to
its conflicts of law principles or rules.  The parties agree that any legal
action or proceeding between Motorola and Licensee with respect to this
Agreement, including the Manufacturer's Agreement, shall be brought in the
United States District Court for the Northern District of Illinois or, if such
court does not have jurisdiction, in any court of general jurisdiction in Cook
County, Illinois.  

 

31

IN WITNESS WHEREOF, the parties
haves caused this Agreement to be executed in duplicate originals by their
duly authorized representatives on the dates indicated below.

 

 

MOTOROLA, INC.                                                      

By:  _____________________________

Title:  ____________________________

Date:  ___________________________

 

FORWARD INDUSTRIES, INC.

BY:  ______________________________

Title:  _____________________________

Date:  _____________________________

 

 

 

 

 

32

 

 

 

EXHIBIT A

TRADEMARKS

The Licensed
Motorola Trademarks are: the MOTOROLA signature and the stylized M logo
("Emsignia") and associated Motorola Trade Dress

 

 

 

 

EXHIBIT B

TERRITORY

Authorized territories are the
following:

 

Europe

Africa, excluding Libya, Sudan 

Middle East, excluding Syria, Iran 

 

 

 

 

 

 

EXHIBIT
C

PRODUCTS

Carry solutions and face plates for cellular
telephones

 

 

 

 

 

 

 

 

 

 

EXHIBIT D

TRADEMARK USE SPECIFICATIONS

Artistic
renderings of the Licensed Motorola Trademarks and Trade Dress and
guidelines for usage of same shall be provided to Licensee under the
following items, which become a part of this agreement by reference:

- Motorola
Basic Corporate Identity Standards, Version 2.0, 2/2002

- Motorola
Design Guidelines, Version 1.1, 11/2001

- Motorola
Consumer Packaging Guidelines, Version 1.1, 3/2002

- Licensed
Product Packaging Guide, 4/2003

- Trademark
Copyright Statements, 1/2002

-
Trademark/Copyright Ownership Statement and Disclaimer Statement for Packaging
and Manuals, 4/2003

-
MOTOMANUAL, 8/2002

- Example
Product Data Sheet/Marketing Collateral, 1/2002

- Example
Packaging Layout, 1/2003

 

 

-Motorola
Image/Document Files:

1)
BasicCorpStnds.pdf

2) Motorola
Design Guidelines.pdf

3) Motorola Packaging Guide Intro.pdf

4) Motorola Packaging Guide2-3.pdf

5) LicensedPackaging.ppt

6) TrademarkCopyright.doc

7) Disclaimer.doc

8) MOTOMANUAL.pdf

9) MP3flyer.pdf

10) MP3flyer.pdf

 

 

-Mototola
logo and artwork files:

1)
emsigniablackm.gif

2)
mothblackl.gif

3) motvblackl.gif

4) motieblackl.gif

5) emsigniablack.ps

6) mothblack.ps

7) motvblack.ps

8) motieblack.ps

 

 

 

 

EXHIBIT E

MANUFACTURER'S AGREEMENT

                                                                                                       

AGREEMENT dated this  ___________day of____________________, 2003, by and
among____(Licensee)_____________________.,
_____________(Address)_______________________("Licensee") and
(Manufacturer)________________________, a _______________________corporation, ("Manufacturer"),
and Motorola, Inc., a Delaware Corporation ("Motorola").

WHEREAS, ____________ has obtained a license from Motorola
to use the Trademarks eferred to in Exhibit 1 ("Trademarks and Trade Dress") to
this Manufacturer's Agreement, on or in conjunction with the product(s)
referred to in Exhibit 2 ("Product(s)") to this Manufacturer's Agreement; and

WHEREAS, Motorola owns throughout the world certain
trademark registrations for the Trademarks for use on a variety of goods; and

WHEREAS, Manufacturer wishes to manufacture for Licensee
Product(s) using the Trademarks exclusively for Licensee.

NOW, in consideration of the foregoing, the covenants
hereinafter set forth, and other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties agree as follows:

1.         TRADEMARK USE

1.1       Manufacturer agrees that any and all rights that
may be acquired by the use of the Trademarks by the Manufacturer shall inure to the sole benefit of
Motorola. The Manufacturer shall execute all papers and to make such filings as
required to confirm such use inures to the benefit of Motorola.

 

 

 

2.         PROTECTION AND
MAINTENANCE OF TRADEMARK

2.1       Manufacturer also agrees to cooperate and
execute all papers reasonably requested by Licensee or Motorola to effect
further registration, maintenance, and renewal of the Trademarks at the sole
expense of Motorola and, where applicable, to record Manufacturer as a
registered user of the Trademarks.  Manufacturer agrees not to use the
Trademarks or any part thereof as part of its corporate or trade name nor use
any name or mark confusingly similar to, or derivative of, the Trademarks.

2.2       Manufacturer further agrees not to register in
any country any name or mark resembling or confusingly similar to or derivative
of the Trademarks.

2.3       Manufacturer agrees that if any application for
registration is, or has been filed in any country by Manufacturer which relates
to any name or trademark which, in the opinion of Motorola, is confusingly
similar, deceptive or misleading with respect to the Trademarks, Manufacturer
shall abandon immediately any such application or registration or, at
Motorola's sole discretion, assign it to Motorola.

2.4       Manufacturer agrees that if it is notified by
Licensee or Motorola of any change in any of the Trademarks, Manufacturer shall
immediately change the Trademarks to conform with such change.

3.         CONTRACT MANUFACTURE LIMITATION

    3.1            Manufacturer agrees that it will not
manufacture any goods using the Trademark other than the Product(s) specified
by this Manufacturer's Agreement for which Manufacturer was approved and shall
exclusively manufacture for and/or sell to Licensee any such Product(s) during
the term of Licensee's license from Motorola to use the Trademarks on such Product(s).

 

4.   COMPLIANCE
WITH LAW AND LABOR PRACTICES

4.1              Manufacturer agrees to comply with all applicable laws, orders, rules
and regulations in performing its obligations.

4.2              Manufacturer warrants that all Products manufactured by Manufacturer
will be produced in compliance with all applicable laws, orders, rules and
regulations in the jurisdiction Manufacturer manufactures the Products.

4.3             
Manufacturer warrants that all Products will be manufactured by it,
whether assembled or packaged in whole or in part, without the use of any
forced labor, prison labor or child labor, and that such Products will not be
trans-shipped for the purpose of mislabeling, evading quota or country of
origin restrictions, or avoiding compliance with provisions against forced
labor, prison labor or child labor.

5.  REPRESENTATION AND WARRANTIES

5.1      Manufacturer further agrees
and warrants that at all times:

(i)        it has and shall maintain all rights and
licenses needed to manufacture and sell the Products and the Products do not infringe any patent, copyright,
mask work right, moral right, trademark, service mark, trade secret and/or all
other intellectual property rights and/or similar rights of any third party.
Manufacturer is solely responsible for all royalties, fees or other payments to
secure such rights and licenses.

(ii)       Manufacturer shall secure and maintain all
certifications and requirements to manufacture and sell the Products and
Manufacturer shall affix all labels on the appropriate area of each Product
regarding such certifications and requirements. Manufacturer shall provide
written evidence of such certifications and approvals upon request.

 

 

(iii) all Products are new, and do not contain anything
used, and Manufacturer shall have processes, procedures and documentation in
place to comply with and substantiate this representation and warranty.

6.  INDEMNIFICATION

6.1       Manufacturer
agrees to indemnify, hold harmless and defend Motorola its subsidiaries and
customers with legal counsel acceptable to Motorola from and against all suits,
actions, claims, damages, liabilities, costs and expenses, including attorneys
fees, court costs and other legal expenses (collectively "Claims"), arising out
of or connected with the Products, Manufacturer's methods of manufacturing the
Products, and the promotional or packaging material relating to the Products,
except where such Claims arise solely out of Licensee's actions or omissions. 
As a condition of this indemnity Motorola agrees to give Manufacturer written
notice of any claim within ten (10) business days of receipt.  Manufacturer
shall bear full responsibility for the defense (including any settlements) of
any such claim; provided, however, that: (i) Manufacturer shall keep Motorola
informed of, and consult with Motorola in connection with the progress of such
litigation or settlement; and (ii) Manufacturer shall not have any right,
without Motorola's prior written consent, to settle any such claim if such
settlement arises from or is part of any criminal action, suit or proceeding or
contains a stipulation to or admission or acknowledgement of, any liability or
wrongdoing (whether in contract, tort, or otherwise) on the part of Motorola or
Motorola subsidiary.

7.  INSPECTION

7.1       Manufacturer
further agrees that upon seven (7) days notice to Licensee, who shall in turn
notify Manufacturer, Motorola shall have the right to inspect, at Motorola's
expense, the manufacturing facilities of Manufacturer during regular business
hours to determine compliance of the Product(s) manufactured by Manufacturer
with the applicable Control Specifications approved by Motorola and supplied to
Manufacturer by Licensee.

8.       CONFLICTING LAWS

          8.1        Manufacturer
agrees that should it be or become aware of any applicable laws or regulations
which are materially inconsistent with the provisions of the Manufacturer's
Agreement, it shall notify Licensee within fifteen (15) days of becoming aware
of such material inconsistency.

9.       TERMINATION
AND EXPIRATION

           9.1       Manufacturer agrees that
upon the termination or expiration of this Manufacturer's Agreement,
Manufacturer shall execute all papers and make such filings as necessary to
terminate any registered user agreements or similar agreements that may have
been executed, filed and/or recorded while this Manufacturer's Agreement was in
effect.

9.2       Manufacturer acknowledges that any material
breach by Manufacturer of this Manufacturer's Agreement will cause irreparable
harm and damages to Licensee and/or Motorola.  If  Licensee  or Motorola
determine Manufacturer has materially breached this Manufacturer's Agreement,
Manufacturer shall have thirty (30) days to cure such breach to the
satisfaction of Motorola  and Licensee. If Manufacturer fails to cure such
material breach in thirty (30) days, this Manufacturer's Agreement shall
terminate. The parties of this Manufacturer's Agreement expressly agree that
Motorola, is an intended beneficiary of this Manufacturer's Agreement with
rights to enforce such agreement.

10.            
GOVERNING LAW

10.1     The construction and performance of this Manufacturer's
Agreement will be governed by the internal, substantive laws of the state of
Illinois without regard to its choice of law rules.  

 

IN WITNESS WHEREOF, each of the parties has caused this
Agreement to be executed in duplicate originals by its duly authorized
representative on the respective dates entered below.

(Manufacturer)                                                 
(Licensee)

By:   __________________________           
By:_______________________

Title:  __________________________          
Title:  _______________________

Date:  __________________________          
Date: _______________________

MOTOROLA, INC.

By:    __________________________

Title:  __________________________

Date:  __________________________

 

 

EXHIBIT F

SALES YEAR;
MINIMUM ROYALTY; ROYALTY RATE

SALES YEARS:

            Sales Year 1:    October
1, 2004 to December 31, 2005

Sales Year 2:    January
1, 2006 to December 31, 2006

            Sales Year 3:    January
1, 2007 to December 31, 2007

MINIMUM ROYALTY:

            Sales Year 1: 
$375,000.00

            Sales Years 2 to 3:  as
provided in Section 8.3.1, Motorola and Licensee shall agree on the Minimum
Royalty for Sales Year 2 and Sales Year 3 prior to the end of the prior Sales
Year.  If Motorola and Licensee are unable to agree on the Minimum Royalty for
Sales Year 2 or Sales Year 3 then the Minimum Royalty shall be seventy-five per
cent (75%) of the actual annualized Royalty for the prior Sales Year, provided
however, in no event shall the Minimum Royalty be less than seventy-five
percent (75%) nor more than one-hundred-twenty-five percent (125%) of the prior
year's annualized Minimum Royalty.

 

ROYALTY RATES BY
PRODUCT:

15% of Net Sales for all
Products

 

 

 

 

 

 

 EXHIBIT G

APPROVED
SUPPLIERS

	
  Vendor

  	

  
	
  Robert Tateosian

  	
  Tateosian
  Ltd

  
	

  	
  London
  House Suite 13, 266 Fulham Road

  
	

  	
  London,
  England, SW10 9EL

  
	

  	

   
	
  CUC Engineering

  	
  CUC
  Engineering A/S

  
	

  	
  PO Box
  207 Industritive J29

  
	

  	
  Slageise,
  Denmark- DK4200

  
	

  	

   
	
  The Clip Company

  	
  The Clip
  Company

  
	

  	
  695 North
  900 West, Suite 9

  
	

  	
  Kaysville,
  Utah  84037

  
	

  	

   
	
  Auld

  	
  The Auld
  Company

  
	

  	
  180
  Outerbelt Street

  
	

  	
  Columbus,
  Ohio  43213

  
	

  	

   
	
  Bush/Colorworks

  	
  Bush
  Technologies Inc

  
	

  	
  1 Mason
  Drive, PO Box 460

  
	

  	
  Jamestown,
  New York  14702-0460

  
	

  	

   
	
  ScreenTech

  	
  ScreenTech
  Ltd.

  
	

  	
  Bray
  Bussines Park, Southern Cross road

  
	

  	
  Bray
  County, Wicklow, Ireland

  
	

  	

   
	
  Superfone

  	
  Superfone
  Telecom BV

  
	

  	
  Bierbrouwersweg
  27

  
	

  	
  NL-3449
  HW Woerden

  
	

  	

   
	
  Madhouse

  	
  Madhouse
  Associates Ltd.

  
	

  	
  Laurence
  Building, 2 Mount Street

  
	

  	
  Manchester,
  UK M2 5WQ

  
	

  	

   
	
  CTP-Davall

  	
  CTP
  Davall Ltd.

  
	

  	
  Carclo
  Technical Plastics

  
	

  	
  Mossburn
  Ave.: Lancshire, England ML7 5NP

  
	

  	

  
	
  Greenpoint

  	
  Westing
  Green (Tianjin) Plastic Co. Ltd.

  
	

  	
  No. 3
  Xinghua Yizhi Rd., Xiqing Economic Development

  
	

  	
  Tianjin,
  China  300381

  
	

  	

   
	
  Sunningdale

  	
  Sunningdale
  Plastics Industries (Tianjin)

  
	

  	
  No. 22
  Huanghai Ave. 1, TEDA

  
	

  	
  Tianjin,
  China

  
	

  	

   
	
  Imageware

  	
  Imageware
  AS

  
	

  	
  Verpet
  Veien 51

  
	

  	
  No 1540
  Vestby, Norway

  

	

EXHIBIT H

PRODUCT
WARRANTY

    Licensee
shall include a written warranty statement on or in all Product
packaging or packaging inserts. Such warranty shall, at a minimum:

		 	a.	
			comply with all applicable laws of the
			country or countries in which the Product is sold;

	 	b.	
			specify what components the warranty
			covers;

	 	c.	
			specify the time period of the
			warranty, which shall be no less than one (1) and no more than five
			(5) years from date of purchase;

	 	d.	
			specify the remedy (e.g. repair,
			replacement, or refund) if the Product does not conform to
			the warranty;

	 	e.	
			specify the Licensee's telephone
			number available to Product purchasers for warranty and other
			support;

	 	f.	
			to the extent allowed by law, exclude
			consequential, incidental and punitive damages and limit any
			remedies to repair, replace or refund; and

	 	g.	
			clearly indicate that Motorola is not
			responsible for warranty support of the Product 

	 	h.	
			be substantively equivalent to the
			sample warranty statement below:

Statement
of Limited Warranty: (Licensee) warrants that for a period of 1 year from
the date of purchase that this product 1) is free from defects in materials and
workmanship and 2) conforms to its specifications. If this product does not
function as warranted during the warranty period, (Licensee), at its option,
will either replace this product with one that is functionally equivalent or
will refund your purchase price. These are your exclusive remedies under this
warranty. Please call 1-800 (XXXXXXXX) for warranty service.

This product
is manufactured, distributed or sold by XXXXXX, official licensee for this
product.  Motorola, the Motorola logo
trademarks and the Motorola trade dress are owned by Motorola, Inc. and are
used under license from Motorola. Please contact XXXXXX at YYYYYYYY for
questions/comments, warranty, support, or service related to this product

This
warranty will be voided by misuse, improper physical environment, accident, or improper maintenance
by you. THIS WARRANTY REPLACES ALL OTHER WARRANTIES OR CONDITIONS, EXPRESS OR
IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OR CONDITIONS OF
MERCHANTABILITY AN]) FITNESS FOR A PARTICULAR PURPOSE. THESE WARRANTIES GIVE
YOU SPECIFIC LEGAL RIGHTS AND YOU MAY ALSO HAVE OTHER RIGHTS WHICH VARY FROM
JURISDICTION TO JURISDICTION. SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OR
LIMITATION OF EXPRESS OR IMPLIED WARRANTIES, SO THE ABOVE EXCLUSION OR
LIMITATION MAY NOT APPLY TO YOU. IN THAT EVENT, SUCH WARRANTIES ARE LIMITED IN
DURATION TO THE WARRANTY PERIOD. NO WARRANTIES APPLY AFTER THAT
PERIOD.

14

 

Circumstances
may arise where, because of a default on (Licensee's) part or other liability,
you are entitled to recover damages from (Licensee). In each such instance,
regardless of the basis on which you are entitled to claim damages from
(Licensee) (including fundamental breach, negligence, misrepresentation, or
other contract or tort claim), (Licensee) is only liable for:

1.          damages for bodily injury (including death) and damage to
real property and tangible
personal property; and

2.          the amount of any other actual direct
damages or loss, up to the greater of $500 or the price
paid for this product.

UNDER NO CIRCUMSTANCES IS
(Licensee) OR XXX LIABLE FOR ANY OF THE FOLLOWING: (1) THIRD-PARTY CLAIMS
AGAINST YOU FOR LOSSES OR DAMAGES (OTHER THAN THOSE UNDER THE FIRST ITEM LISTED
ABOVE); (2) LOSS OF, OR DAMAGE TO, YOUR RECORDS OR DATA: OR (3) SPECIAL,
INCIDENTAL OR INDIRECT DAMAGES OR FOR ANY ECONOMIC CONSEQUENTIAL DAMAGES
(INCLUDING LOST PROFITS OR SAVINGS), EVEN IF (Licensee) OR XXX ARE INFORMED OF
THEIR POSSIBILITY. SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OR LIMITATION OF
INCIDENTAL OR CONSEQUENTIAL DAMAGES, SO THE ABOVE EXCLUSION OR LIMITATION MAY
NOT APPLY TO YOU.

 

 

 

15

 

 

EXHIBIT I

 

REPORTING
REQUIREMENTS

At a minimum, the Licensee shall
provide monthly written reports no later than the 15th day of each
month that includes the following information:

 

Monthly Sales and Royalty Report

-Reporting Month and Year

-Primary Contact Person

-Licensee Address and Phone Number

-Customer name, region and country

-Product SKU#

-Product Description

-Royalty %

-Selling Price

-Units Sold for the Month and
Year-to-Date

-Sales Revenue for the Month and
Year-to-Date

-Total Royalties for the Month and
Year-to-Date

-Units Returned for the Month

-Total Net Royalties Year-to-Date

16

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