Document:

ex10-3.htm

Exhibit 10.3

 

SECURITY AGREEMENT

This Security Agreement (the “Security Agreement”) is entered into and effective as of the 1st day of October, 2010, by and between Lester Petracca (the “Secured Party”) and Sebring Software, LLC, a Florida limited liability company (the “Company”).  This Security Agreement is entered into to secure amounts owed to Secured Party pursuant to the terms of that certain Secured Promissory Note by and between Company and the Secured Party dated as of an even date herewith (the “Note”).

 

NOW, THEREFORE, for good and valuable consideration, receipt of which is hereby acknowledged, the Secured Party and Company hereby agree as follows:

 

1. Security Interest.  To secure the full and timely payment of the Obligations (as defined below)in accordance with the terms thereof, Company hereby transfers, conveys, assigns, and grants to Secured Party a security interest in all right, title and interest of Company in and to all of Company’s assets as of the date of this Security Agreement, except for and excluding 6,306,950 shares of Sumotext Incorporated common stock and distributions received on account thereof (including shares issued in connection with any forward split), and all proceeds, and products therefrom and improvements and accessions thereto, including without limiting the generality of the foregoing the following items (hereinafter, collectively, the “Collateral”):

 

(a) General Intangibles.  All of Company’s General Intangibles, now existing or hereafter arising or acquired, together with the proceeds therefrom.  As used herein, the term “General Intangibles” means any “general intangibles,” as such term is defined in the UCC, including all personal property (including things in action) other than goods, accounts, chattel paper, documents, instruments, and money, and includes, but is not limited to, business records, deposit accounts, inventions, intellectual property, designs, patents, patent applications, trademarks, trademark applications, trademark registrations, service marks, service mark applications, service mark registrations, trade names, goodwill, technology, know-how, confidential information, trade secrets, customer lists, supplier lists, copyrights, copyright applications, copyright registrations, licenses, permits, franchises, tax refund claims, and any letters of credit, guarantee claims, security interests, or other security held by Company to secure any “Accounts” (as hereinafter defined).

 

(b) Accounts (including Accounts Receivable).  All of Company’s Accounts, whether now existing or hereafter arising or acquired, together with the proceeds therefrom.  As used herein, the term “Accounts” means any “account” and any “right to payment” as such terms are defined in the UCC, and any right of Company to receive payment from another person or entity, including payment for goods sold or leased, or for services rendered, no matter how evidenced or arising, and regardless of whether yet earned by performance.  It includes, but is not limited to, accounts, accounts receivable, contract rights, contracts receivable, purchase orders, notes, drafts, acceptances, all rights to payment earned or unearned under any contract and all rights incident to the contract, and other forms of obligations and receivables.

  

  

  

(c) Inventory.  All of Company’s Inventory, whether now owned or hereafter acquired, together with the products and proceeds therefrom and all packaging, manuals, and instructions related thereto.  As used herein, the term “Inventory” means any “inventory,” as such term is defined in the UCC, including all goods, merchandise, and personal property held for sale or leased or furnished or to be furnished under contracts of service, and all raw materials, work in process, or materials used or consumed in Company’s business, wherever located and whether in the possession of Company, a warehouseman, a bailee, or any other person.

 

(d) Equipment.  All of Company’s Equipment, now owned or hereafter acquired, together with the products and proceeds therefrom, and all substitutes and replacements therefor.  As used herein, the term “Equipment” means any “equipment” as such term is defined in the UCC, and includes all equipment, machinery, tools, office equipment, supplies, furnishings, furniture, or other items used or useful, directly or indirectly, in Company’s business, all accessions, attachments, and other additions thereto, all parts used in connection therewith, all packaging, manuals, and instructions related thereto, and all leasehold or equitable interests therein.

 

(e) Goods.  All of Company’s Goods (other than Inventory and Equipment), now owned or hereafter acquired, together with the products and proceeds therefrom, and all substitutes and replacements therefor. “Goods” means any “goods,” as such term is defined in the UCC.

 

(f) Fixtures.  All of Company’s interest in and to all fixtures and furnishings, now owned or hereafter acquired, together with the products and proceeds therefrom, all substitutes and replacements therefor, all accessories, attachments, and other additions thereto, all tools, parts, and supplies used in connection therewith, and all packaging, manuals, and instructions related thereto, located on or attached to Company’s business premises.

 

(g) Chattel Paper, Documents and Instruments.  All of Company’s right, title, and interest in any chattel paper, deposit accounts, investment property, documents, or instruments, as such terms are defined in the UCC, now owned or hereafter acquired or arising, or now or hereafter coming into the possession, control, or custody of Company or Secured Party, together with all proceeds therefrom.

 

(h) Records.  All of Company’s computer programs, software, hardware, source codes and data processing information, all written documents, books, invoices, ledger sheets, financial information and statements, and all other writings concerning the Collateral.

 

2. Obligation.  The security interest granted hereunder is given as security for the payment and performance of all indebtedness and obligations owed by Company to Secured Party under the Note, together with all extensions, modifications, or renewals of any of the foregoing (hereinafter referred to, collectively, as the “Obligations”).  Company acknowledges that the Note qualifies as an “instrument for the payment of money only” pursuant to New York Civil Practice Law & Rules (“CPLR”) section 3213, and will not oppose any action based on default under the New Note on the grounds that the Note is not such an instrument and/or is not subject to CPLR 3213.

  

  

  

3. Proceeds; UCC Terms.  As used in this Security Agreement, the term “proceeds” means all products of the Collateral and all additions and accessions to, replacements of, insurance or condemnation proceeds of, and documents covering any of the Collateral, all property received wholly or partly in trade or exchange for any of the Collateral, all leases of any of the Collateral, and all rents, revenues, issues, profits, and proceeds arising from the sale, lease, license, encumbrance, collection, or any other temporary or permanent disposition, of any of the Collateral or any interest therein.  As used in this Agreement, “UCC” means the Uniform Commercial Code as the same may, from time to time, be in effect in the State of Utah; provided, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of, or remedies with respect to, the security interests of Secured Party on any Collateral is governed by the Uniform Commercial Code as enacted and in effect in a jurisdiction other than the State of Utah, the term “UCC” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority or remedies and for purposes of definitions related to such provisions.  Unless otherwise defined herein, terms that are defined in the UCC and used herein shall have the meanings given to them in the UCC.

 

4. Title; Filing.  Company warrants that Company is the owner of the Collateral free and clear of all liens, claims, and encumbrances except for Permitted Liens (“Permitted Liens”) set forth on Exhibit A.  Company covenants that so long as any portion of the Obligation remains unpaid, Company will not execute or file a financing statement or security agreement covering the Collateral to anyone other than Secured Party, except with respect to Permitted Liens.  Company authorizes Secured Party to prepare and file any financing statements describing the Collateral without otherwise obtaining Company’s signature or consent with respect to the filing of such financing statements.

 

5. Care of Collateral.  Company will keep the Collateral in good repair and be responsible for any loss or damage to it; at all times warrant and defend Company’s ownership and possession of the Collateral; keep the Collateral free from all liens, claims, encumbrances and security interests, other than Permitted Liens; pay when due all taxes, license fees, and other charges upon the Collateral or upon Company’s business, property or the income therefrom; and not misuse, conceal or in any way use or dispose of the Collateral unlawfully or contrary to the provisions of this Security Agreement or of any insurance coverage in any material respect. Loss of, damage to, or uncollectability of the Collateral or any part thereof will not release Company from any of its obligations hereunder.

 

6. Default.  Each of the following shall constitute an event of default (“Event of Default”) under this Security Agreement:

 

(a) Default in Payment.  If Company fails to pay outstanding principal and accrued interest under the Note on or before the Maturity Date;

  

  

  

(b) Representations and Warranties.  If any of the representations and warranties made by Company herein or by Company in the Note shall be false or misleading in any material respect when made;

 

(c) Covenants.  If Company shall be in material default under any of the non-payment terms, covenants, conditions, or obligations of this Security Agreement or the Note and such default shall not have been cured within thirty (15) days of Company’s receipt of Secured Party’ written notice of default;

 

(d) Impairment to Lien.  If at any time the Collateral may be impaired by any lien, encumbrance or other defect other than the Permitted Liens, and such lien, encumbrance or defect shall not have been removed within thirty (30) days of Company’s receipt of Secured Party’ written notice thereof;

 

(e) Inconsistent Transfer.  If at any time Company transfers an interest in any of the Collateral contrary to the provisions hereof without the prior written consent of Secured Party other than in the ordinary course of business, and such interest in the Collateral shall not have been retransferred or restored within thirty (30) days of Company’s receipt of Secured Party’ written notice thereof;

 

(f) Voluntary Bankruptcy or Insolvency Proceedings. If Company, shall (i) apply for or consent to the appointment of a receiver, trustee, liquidator or custodian of itself or of all or a substantial part of its property, (ii) make a general assignment for the benefit of any of its creditors, (iii) be dissolved or liquidated in full or in part, suspends its normal business operations or otherwise fails to continue to operate its business in the ordinary course, (iv) commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or consent to any such relief or to the appointment of or taking possession of its property by any official in an involuntary case or other proceeding commenced against it or (v) take any action for the purpose of effecting any of the foregoing; or

 

(g) Involuntary Bankruptcy or Insolvency Proceedings.  If proceedings for the appointment of a receiver, trustee, liquidator or custodian of Company or of all or a substantial part of the property thereof, or an involuntary case or other proceedings seeking liquidation, reorganization or other relief with respect to Company or the debts thereof under any bankruptcy, insolvency or other similar law now or hereafter in effect shall be commenced, and an order for relief entered or such proceeding shall not be dismissed or discharged within sixty (60) days of commencement.

 

Waiver of any Event of Default will not constitute a waiver of any other or subsequent Event of Default.

 

7.  Remedies.  Upon the occurrence of an Event of Default and during the continuance of any such default at any time thereafter, Secured Party shall, by written notice to the Company, be entitled to accelerate all unpaid Obligations.  Secured Party will have the remedies of a secured party under the UCC or other applicable law including without limitation the right to enter any premises where Collateral is located and take possession and control thereof without demand or notice and without prior judicial hearing or legal proceedings, which the Borrower expressly waives.  Secured Party shall give the Company such notice of any private or public sales as may be required by the UCC or other applicable law. Secured Party shall have the right upon any such public sale, and, to the extent permitted by law, upon any such private sale, to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption, which right or equity of redemption the Company hereby releases, to the extent permitted by law.  For the purpose of enabling Secured Party to exercise its rights and remedies under this Section 7 or otherwise in connection with this Agreement, each Company hereby grants to Secured Party an irrevocable, non-exclusive and assignable license (exercisable without payment or royalty or other compensation to Companies) to use, license or sublicense any intellectual property Collateral after an Event of Default.  Secured Party shall apply the proceeds of any sale or liquidation of the Collateral (the “Proceeds”), first to the payment of the reasonable costs and expenses incurred by Secured Party in connection with such sale or collection, including without limitation reasonable attorneys’ fees and legal expenses, second to the payment of the Obligations, whether on account of principal or interest or otherwise as Secured Party, in its sole discretion, may elect, and then to pay the balance, if any, to Company or as otherwise required by law. If such Proceeds are insufficient to pay the amounts required by law, Company shall be liable for any deficiency.

  

  

  

8. Costs and Expenses.  The Company agree to pay on demand all reasonable costs and expenses of Secured Party, and the reasonable fees and disbursements of counsel, in connection with the enforcement of any rights or interests under this Agreement, including in any out-of-court workout or other refinancing or restructuring or in any bankruptcy case, and the protection, sale or collection of, or other realization upon, any of the Collateral, including all expenses of taking, collecting, holding, sorting, handling, preparing for sale, selling, or the like, and other such expenses of sales and collections of Collateral.  Any amounts payable to Secured Party under this Section 8 or otherwise under this Agreement if not paid upon demand shall bear interest from the date of such demand until paid in full, at the default rate of interest set forth in the Note.

 

9. Termination. This Security Agreement shall terminate and the Collateral herein shall be released from the lien of the Secured Party at such time as the Obligation to the Secured Party has been satisfied or terminated.

10. Costs and Expenses.  Company agrees to pay on demand all reasonable costs and expenses of Secured Party, and the reasonable fees and disbursements of counsel, in connection with the enforcement of any rights or interests under this Agreement, including in any out-of-court workout or other refinancing or restructuring or in any bankruptcy case, and the protection, sale or collection of, or other realization upon, any of the Collateral, including all expenses of taking, collecting, holding, sorting, handling, preparing for sale, selling, or the like, and other such expenses of sales and collections of Collateral.  Any amounts payable to Secured Party under this Section 10 or otherwise under this Agreement if not paid upon demand shall bear interest from the date of such demand until paid in full, at the default rate of interest set forth in the Note.

 

11. General.

 

11.1           Notices. Any notice or other communication required or permitted to be given under this Note shall be in writing, shall be delivered by hand or overnight courier service, by certified mail, postage prepaid, or by facsimile, and will be deemed given upon delivery, if delivered personally, one business day after deposit with a national courier service for overnight delivery, or one business day after transmission by facsimile with confirmation of receipt, and three days after deposit in the mails, if mailed, to the following addresses:

  

  

  

 

	  	
(i)  If to the Secured Party:

 

	  	
Lester Petracca

	  	
c/o Triangle Equities

	  	
30-56 Whitestone Expressway

	  	
Whitestone, NY 11354

 

	  	
(ii)  If to Company:

	  	  
	  	
Sebring Software, LLC

	  	
1400 Cattlemen Dr., Suite D

	  	
Sarasota, FL 24232

	  	
Attention:  Manager

 

or to such other address as may have been furnished to the other party in writing pursuant to this Section 11.1, except that notices of change of address shall only be effective upon receipt.

 

11.2           Assignment; Binding upon Successors and Assigns. Company may not assign any of its obligations hereunder without the prior written consent of the Secured Party.  The terms and conditions of this Note shall inure to the benefit of and be binding upon the successors and permitted assigns of the parties.

 

11.3           Entire Agreement.  This Security Agreement, the Note and other documents and instruments contemplated by the Security Agreement set forth the entire agreement between Company and each Secured Party with respect to all matters herein, and supersede all prior and contemporaneous security agreements, representations, and understandings of the parties.  No supplement, amendment or modification of this Security Agreement shall be binding unless executed in writing by all of the parties.

 

11.4           No Waiver.  Subject to provisions of this Agreement requiring the consent of Secured Party, no waiver of any of the provisions of this Security Agreement shall be deemed, or shall constitute, a wavier of any other provision, whether or not similar, nor shall any waiver constitute a continuing waiver, and, no waiver shall be binding unless executed in writing by the party making the waiver.

 

11.5           Governing Law.  This Security Agreement shall be governed by and construed under the laws of the State of New York as applied to agreements among Utah residents entered into and to be performed entirely within New York, without reference to principles of conflict of laws or choice of laws.

  

  

  

11.6           Severability of Provisions.  Any provision of this Security Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of the Security Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

 

 

 

 

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

	
COMPANY:

	
SEBRING SOFTWARE, LLC,

	  	
a Florida limited liability company

	  	  
	  	
By: /s/ Leif Andersen

	  	
Name: Leif Andersen

	  	
Its: Manager

	  	  
	  	  
	  	  
	 
SECURED PARTY:

	/s/ Lester Petracca
	  	
LESTER PETRACCA

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

  

  

EXHIBIT B

PERMITTED LIENS

 

(i) statutory liens for taxes to the extent that the payment thereof is not in arrears or otherwise due;

 

(ii) encumbrances in the nature of zoning restrictions, easements, rights or restrictions on the use of property if the same do not impair its use in the conduct of the business of the Company and its subsidiaries as currently conducted and as currently proposed to be conducted;

 

(iii) statutory or common law liens to secure landlords, lessors or renters under leases or rental agreements confined to the premises rented to the extent that no payment or performance under any such lease or rental agreement is in arrears or is otherwise due;

 

(iv) deposits or pledges made in connection with, or to secure payment of, worker’s compensation, unemployment insurance, old age pension programs mandated under applicable Legal Requirements or other social security;

 

(v) statutory or common law liens in favor of carriers, warehousemen, mechanics and materialmen, statutory or common law liens to secure claims for labor, materials, equipment or supplies and other like liens, which secure obligations to the extent that payment thereof is not in arrears or otherwise due;

 

(vi) liens incurred in connection with surety bonds, bids, performance bonds and similar obligations for sums not overdue or being contested in good faith by appropriate proceedings;

 

(vii) liens arising in connection with capital leases (and attaching only to the property being leased), liens existing on property at the time of the acquisition thereof by the Company (and not created in contemplation of such acquisition) and liens that constitute purchase money security interests on any property securing debt incurred for the purpose of financing all or any part of the cost of acquiring such property, provided that any such lien attaches to such property within 60 days of the acquisition thereof and attaches solely to the property so acquired; and

 

(viii) attachments, appeal bonds, judgments and other similar liens arising in connection with court proceedings, provided the execution or other enforcement of such liens is effectively stayed and the claims secured thereby are being actively contested in good faith and by appropriate proceedings.

 

(ix) Liens securing indebtedness held by a creditor that has agreed to subordinate its (i) right to repayment, (ii) priority of liens securing such indebtedness, and (iii) right to enforce remedies against Company following default to the liens of Secured Party and the prior payment of the Obligations to Secured Party pursuant to a written subordination agreement approved by Secured Party, which approval shall not be unreasonably withheld.

 

(x) Liens in favor of Secured Party.ex10-4.htm

Exhibit 10.4

LICENSE AGREEMENT

THIS LICENSE AGREEMENT, by and between Engineering Consulting and Solutions, GMBH, with its principal office in Neumarkt, Germany (“ECS” or “Licensor”) and Sebring Software, LLC, a Florida limited liability company with its principal office in Sarasota County, Florida (“Sebring” or “Licensee” or “reseller”) (each a “Party” and together the “Parties”).  The “Effective Date” hereof shall be the later of: (i) the date when the Advanced Payment has been made, or (ii) November 30, 2010.

WITNESSETH:

	
A.  

	
WHEREAS, The Licensor has made certain new and useful inventions including computer software and graphic designs embracing a flexible user interface for internet applications, all as more fully described on Exhibit A, hereto (the “Technology”);

	
B.  

	
WHEREAS, The Licensor desires to have the Technology commercialized in the Territory and to distribute and to deliver related services to end users (as defined in Exhibit B, hereto) through the granting of a non exclusive license (the “License”) to Licensee for the Territory.

	
C.  

	
WHEREAS, The Licensee desires to acquire a non exclusive license to commercialize, deliver related services, create adaptors for customers based on the Licensor’s Technology programming interfaces, suggest and cooperate on improvements, use and license the Technology in the Territory for internal use and demonstration.

NOW, THEREFORE, it is agreed as follows:

 

	
1  

	
LICENSE AGREEMENT

	
1.1  

	
License

 

The Licensor hereby grants to the Licensee the non-exclusive right and license in the Territory to commercialize and distribute to end users, create adaptors and integrators based on the Licensor’s Technology programming interfaces, suggests and cooperate on improvements, use and exploit the Technology; to practice the processes embodied therein; and to use and create adaptors and integrators as described before for customer project demands.

	
a.  

	
The Licensor hereby grants to the Licensee the non-exclusive right to grant non-exclusive sublicenses to end users on such terms as are consistent with the provisions of this Agreement and which are otherwise acceptable to the Licensor.

	
b.  

	
The non-exclusive rights and license herein granted shall include upcoming new versions of the Technology and new releases.

  

  

  

	
2  

	
REPRESENTATIONS AND COVENANTS OF LICENSOR

2.1 Representations by Licensor

 

The Licensor represent that:

	
a)  

	
Licensor is the exclusive owner of all rights to the Technology and any patent, copyright or trademark applications to be filed thereon, has the right to grant the non-exclusive license hereby granted; and

 

	
b)  

	
Licensor has at no time filed, or caused to be filed, applications for patents, copyrights or trademarks or obtained in its name, or caused to be obtained in the name of others, any patents, copyrights or trademarks, in the United States or elsewhere based on or covering any of the Technology, but may do so or seek to do so in its sole discretion.

	
2.2  

	
Necessary Information and Documents

 

The Licensor shall furnish to the Licensee, at no cost, the Technology manuals regarding the Technology which are available to the Licensor to enable the Licensee to operate hereunder.

 

	
3  

	
PAYMENTS

3.1 Advance Payment

 

Licensee agrees to pay Licensor One Hundred and Fifty Thousand United States Dollars (U.S.$150,000) (hereinafter, the “Advance Payment”) within ninety (90) days of the execution of this Agreement by the Parties which payment shall constitute an advance against the Royalty Payments contemplated in Section 3.2, herein.

3.2 Royalty Payments

 

As the sole consideration for the license granted to it however, Licensee agrees to pay Licensor, as a royalty, an amount equal to fifty percent (50%) of the prices documented in the actual Licensor pricelist (Exhibit C).

3.3 Treatment of Advance Payment

 

The Advance Payment shall constitute a non-refundable advance payment of the royalties due under Section 3.2 and shall not be in addition to royalties that are otherwise due hereunder..

3.4 Payment Procedures

 

The royalty payments due under Section 3.2, after taking into account Section 3.3, herein shall be paid within thirty (30) days after the end of each month during the Term of this Agreement.  Each payment shall be accompanied by a report indicating the specific sales or sub-licenses which resulted in paid royalties.  The Licensor’s invoiced amounts must be paid in full.

  

  

  

3.5 Records

 

Licensee agrees to keep complete and accurate records of all transactions on which royalty payments may be due under this Agreement.  Licensee will maintain an accurate and complete list of all customers to whom Licensee distributes Licensors software, including the names and addresses of each End User or entity, the date of the delivery of the software and the Licenses Agreement. Such records shall be maintained for a period of at least two (2) years after the date of the recorded transaction.  Licensor shall have a right to inspect such records either itself or through a party designated by Licensor at reasonable times and on reasonable notice to Licensee at Licensee’s facility during normal business hours.  The cost of any such audit shall be borne by Licensor unless such audit reveals an error of more than one percent (1%) in royalty payments, in which event the cost of such audit shall be borne and promptly paid to Licensor by Licensee.  Licensee agrees to promptly pay Licensor the amount of any underpayment revealed by such audit, and shall receive a credit for any overpayment.

	
4  

	
TERM

 

Under the following circumstances

	
4.1  

	
The Term of this Agreement shall commence on the effective date and renew annually as long as there are no material breaches from either party or if any patents issue in the Territory on the Technology for the full life of the last to expire of such patents, whichever is earlier; provided, however, the rights and licenses granted to the Licensee hereunder shall continue for one additional year upon written consent by both parties, but subject to the following rights of termination:

 

	
4.2  

	
The Licensee may at any time, upon one month’s written notice to the Licensor, terminate this Agreement and the licenses granted hereunder.

 

	
4.3  

	
If the Licensee breaches or is in default in performing any of the terms of this Agreement and such default continues for a period of thirty (30) days after written notice thereof is given to the Licensee, or if the Licensee is adjudicated bankrupt or insolvent, or enters into a compromise with its creditors, or if a receiver is appointed for any substantial portion of Licensee’s assets, then the Licensor shall have the right to terminate this Agreement upon giving notice to the Licensee at least ten (10) days prior to the effective date of termination, and thereupon the Agreement and the rights and licenses granted hereunder to the Licensee shall become void, without prejudice to any remedy of the Licensor for the recovery of any moneys due it under this Agreement.

 

	
4.4  

	
Without limiting the foregoing, the Licensor may also terminate this agreement with written notice if the Licensee’s royalties payable under Section 3.2 do not reach a minimum of $150,000.00 in the first year of its term and $250,000.00 in the following years of the term, as adjusted for inflation.

 

	
4.5  

	
Notwithstanding the foregoing, if, within eighteen (18) months of the effective date, Licensee fails to perform any of its obligations or make any payment owned to any person pursuant to any outstanding promissory note, loan or similar instrument or obligation, then Licensor shall have the right to immediately terminate this Agreement, whereupon this Agreement and the rights and licenses granted hereunder to the Licensee shall become void, without prejudice to any remedy of the Licensor for the recovery of any moneys due it under this Agreement.

	
5  

	
INFRINGEMENT

	
5.1  

	
Infringement

 

In the event information is brought to Licensor’s attention that others without license are infringing on the rights granted to Licensee pursuant to Article 1 hereof, the Licensee shall prosecute diligently any infringer at its own expense.

  

  

  

	
6  

	
IMPROVEMENTS

	
6.1  

	
Improvements

 

If during the term of this Agreement, the Licensor, shall make any further improvements in the Technology, or become the owner of any new improvements, then it shall communicate such improvements to the Licensee and the Licensee shall have the right to include the same in this Agreement.  Licensee agrees to pay Licensor, as a royalty, an amount equal to fifty percent (50%) of the prices documented in the current pricelist as provided by Licensor from time-to-time.

	
7  

	
OWNERSHIP AND PROPRIETARY RIGHTS

	
7.1  

	
Ownership

 

Licensee acknowledges that all right, title, and interest in the Technology is the property of Licensor. Licensee acknowledges that the Technology is copyrighted and that Licensee may not reproduce any copies of the Technology. Licensee is expressly prohibited from reverse engineering, or decompiling of the Technology. Licensee may not sublicense, assign, or transfer any of the rights relating to the use of the Technology, except as expressly permitted in writing by Licensor. Licensee agrees to indemny and hold harmless Licensor from and against any loss, liability, damage, or expense (including attorney's fees) incurred by Licensor, as a result of any Licensor breach of any of their obligations under this section, or under applicable copyright or intellectual property law.

7.2 Software Rights

 

For Technology which is itself software, or which incorporate software in any form, and for which licensor provides software license terms as part of the Technology documentation, Licensee must:

	
a)  

	
Operate and demonstrate that Technology only in accordance with the software license terms;

	
b)  

	

Convey to Licensee’s Customers the applicable software

	
8  

	
CONFIDENTIALITY

	
8.1  

	
Confidential Disclosure

 

Licensee understands and acknowledges that by execution of this Agreement a confidential relationship is created whereby Licensee may have access to certain information and materials concerning Licensor's business, plans, customers, technology and products that are confidential and of substantial value to Licensor, the value of such would be impaired if such information were improperly used or disclosed to third parties. Licensee therefore agrees that it will not disclose to any third party, or use in any way for its own account or the account of any third party, any such confidential information revealed to it by Licensor other than to fulfill its express obligations under this Agreement.

 

	
8.2  

	
All End User customer lists, potential customer lists, marketing and financial information, business plans and technical information whether written or verbal of either Party, relating to the Products, and the Product and all code, inventions, algorithms, know how and ideas relating thereto shall be deemed confidential information of Licensor.

 

	
8.3  

	
Licensee shall keep and have its agents and employees keep all confidential information of Licensor confidential and shall not copy or disclose the same, or authorize its employees or agents to copy or disclose the same, except as specifically authorized by this Agreement, without the prior written consent of Licensor. Upon expiration or termination of this Agreement, Licensee shall return to Licensor all copies of all confidential information, whether printed or otherwise.

  

  

  

	
8.4  

	
Licensor retains all rights and title to its confidential information, in any form, disclosed to the Licensee pursuant to this Agreement. Licensee acknowledges that such confidential information is of substantial value to Licensor and that any disclosure or misuse of such confidential information is likely to cause irreparable harm.

	
9  

	
SUPPORT SERVICES

	
9.1  

	
Support Services

 

During the Term of this Agreement, Licensor will provide Licensee all support reasonably requested by Licensee to assist Licensee in the use and customizing of the Software, and all analysis and programming services reasonably necessary to correct and resolve any errors or problems which appear in the Software as a result of use of license by Licensee.  Licensee agrees to pay Licensor for such services pursuant to a support agreement to be negotiated in good faith between Licensor and Licensee.

	
10  

	
WARRANTY

 

	
10.1  

	
Licensor warrants that it has and will during the term of this Agreement maintain the right to grant Licensee the right to use and distribute the Technology under this Agreement.

 

	
10.2  

	
Licensor warrants that for a term of ninety (90) days from the date of delivery to Licensee’s customers the Technology will perform substantially in accordance with the Technology Documentation provided. If the Licensee’s customers asserts a defect in the Technology during the above defined warranty period, Licensee shall be entitled as its sole remedy, at Licensor's sole option and expense, to have the defective Technology replaced by Licensor with Technology that substantially conforms to the Technology Documentation. If the replacement does not rectify the defect, or if the replacement is unduly delayed, Licensee shall be entitled to a refund or reduction of the price paid.

 

	
10.3  

	
Licensor shall not be liable under this warranty if its testing and examination discloses that the alleged defect in the Technology does not exist or was caused by Licensee's or Licensee’s customers or any third party's misuse, neglect, improper installation or testing, unauthorized attempts to repair or modify, or any other cause beyond the range of the intended use of the Technology, or by accident, fire lightning, or other hazard.

 

	
10.4  

	
Licensor does not warrant that the functions contained within the Technology will meet Licensee’s customer requirements, or will operate in any combination which may be selected for use by Licensee or customer, or that operation of the Technology will be uninterrupted or error free, or that any defects that may exist in the Technology will be corrected. This warranty is in lieu of all other warranties, express or implied, including any warranties of merchantability or fitness for a particular purpose. Notwithstanding any failure of the purpose of any limited remedy, Licensee's entire remedy for breach of warranty shall be limited to a refund of the purchase price for such Technology.

	
11  

	
INDEMNITY BY LICENSEE

	
11.1  

	
Licensee agrees to indemnify and hold Licensor harmless from and against any and all claims, liabilities, costs and expenses, however stated, relating to or arising from Licensee's performance under this Agreement, changes, additions or modifications made to the Technology by Licensee negligence or other acts or omissions of Licensee its officers, agents and employees, and delay, misuse, malfunction or other cause solely within the control of or under the authority of Licensee.

  

  

  

 

	
12  

	
LIMITATION OF LIABILITY

	
12.1  

	
Except as otherwise set forth herein, either party’s entire liability arising out of this agreement and/or sale/license/distribution of Technology shall be limited to the amount paid by Licensee for such Technology. In no event shall Licensor or Licensee be liable for costs of procurement of substitute goods and services, loss of use, data, or profits, or any special, incidental, indirect, or consequential damages, arising out of or in connection with this agreement or the use or the performance of Technology however caused and on any theory of liability, whether or not Licensor or Licensee has been advised of the possibility of such damage. The essential purpose of this provision is to limit the potential liability of either party arising out of this agreement and/or sale/license/distribution of Technology.

	
13  

	
MISCELLANEOUS

13.1 Applicable Law

 

This Agreement shall be governed and construed in accordance with the laws of Germany.  The parties further agree that any dispute which is to be litigated under this Agreement shall be litigated in the appropriate court of Germany and Licensee agrees to be subject to jurisdiction in such state.

13.2 Severability

 

The provisions of this Agreement shall be deemed separable.  Therefore, if any part of this Agreement is rendered void, invalid, or unenforceable; such rendering shall not affect the validity or enforceability of the remainder of this Agreement unless the part or parts that are void, invalid or unenforceable as aforesaid shall substantially impair the value of the whole Agreement to either Party.  In such case, the Parties agree to negotiate in good faith a substitute provision that is as close to the void, invalid or unenforceable provision as possible, but which in valid and lawful.  In the event the Parties cannot negotiate an acceptable substitute provision which would permit the Agreement to remain in effect and still accomplish its intended objectives, then the Parties agree that the Agreement shall terminate.

13.3 Confidentiality of Agreement

 

The Parties agree that the existence of this Agreement shall not be confidential and that either Party may disclose the existence of this Agreement to third parties.

 

13.4 Notices

Any and all communications required as provided for in this Agreement shall be in writing and sent by First Class Mail, postage prepaid, and addressed to the last known address of the Party to be served therewith.  Notices sent by Certified Mail, Return Receipt Requested, shall be presumed to have been received.

Any notice to be given to Licensor shall be addressed to:

Engineering Consulting and Solutions, GMBH

Holzgartenstrasse 8

92318 Neumarkt in der Oberpfalz

Germany

Attention: CEO

  

  

  

Any notice to be given to Licensee shall be addressed to:

Sebring Software, LLC

1400 Cattlemen Road, Suite D

Sarasota, Florida  34232

United States of America

Attention: President

Any change in address of a Party shall be promptly communicated in writing to the other Party.

13.5 Integration and Amendment

 

This Agreement sets forth the entire agreement between Parties relating to the subject matter contained herein, superseding any prior agreements, whether oral or written, and may not be modified, amended, assigned or discharged except as expressly stated in this Agreement or by a written agreement signed by authorized representatives of the Parties.

 

	
13.6  

	
Headings

 

The article and section headings in this Agreement are inserted for convenience only and shall not constitute a part hereto.

	
13.7  

	
Assignments

 

This Agreement shall be binding upon, and shall inure to the benefit of, the respective heirs, legal representatives, successors and assigns of the Parties.

13.8 Counterparts

 

This Agreement may be executed in two or more counterparts, each of which shall be deemed to constitute an original and shall be admissible for all purposes in action for breach of or enforcement of this Agreement.

13.9 Litigation

 

In the event of legal action to enforce the terms of this Agreement by one Party against the other, the prevailing Party shall be entitled to recover its reasonable attorneys’ fees and costs in bringing such action or any appeal thereof.

	
13.10  

	
Survival of Certain Obligations

 

After expiration or termination of this Agreement, all provisions relating to payment shall survive until completion of required payments.  In addition to those provisions which specifically provide for survival beyond expiration or termination, all provisions contained in this section and all provisions, if any, regarding indemnification, warranty, limitations of liability, and confidentiality and/or protection of proprietary rights and trade secrets shall survive indefinitely or until the expiration of the time period specified elsewhere in this Agreement with respect to the provision in question.

 

[Signature Page to Follow]

  

  

  

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement this Agreement to be executed induplicate.

LICENSOR

	
ENGINEERING CONSULTING and SOLUTIONS, GMBH

By: ________________________________________________

	
As its: CEO

 

	
LICENSEE

 

	
SEBRING SOFTWARE, LLC

 

	
By: ________________________________________________

	
As its: PRESIDENT

 

 

 

 

 

 

  

  

  

EXHIBIT A: “Technology”

For purposes of this Agreement, “Technology” shall mean software, graphic or other designs, procedures, processes, know-how, trade secrets, patents, trademarks including source code, copyrights, integrators and all other related tangible or intangible property or property rights related to flexible user interfaces for internet applications, including those permitting integration of different software and internet applications into a single web-based platform and including, but not limited to, existing and future products offered or developed by ECS; including existing ECS products identified by ECS as

Engineering Portal, (All Modules as described in the ECS Pricelist)

eCenter ,(All Modules as described in the ECS Pricelist)

eCenter ICM2, (All Modules as described in the ECS Pricelist).

eCenter PLM Integrator

eCenter ERPxPDM

 

 

 

 

 

 

 

 

 

 

  

  

  

EXHIBIT B: TERRITORY

For purposes of this Agreement, Territory shall include the continents of North America, including the islands of Hawaii, South America and the Caribbean Islands.

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