Document:

Agreement to Acquire Intellectual Property

This agreement is dated April 17, 2003 between:
Duane Nickull and Matt MacKenzie, doing business as "Yellow Dragon Software", ("Yellow Dragon");

and 
XML-Global Technologies, Inc., a Colorado corporation, ("XML Global");

Whereas:

	 	
a)
	
XML Global owns certain proprietary technology and computer software known as GoXML Messaging (the "Technology").

	 	
b)
	
Yellow Dragon wishes to purchase rights to the Technology with a view to maintaining and selling it.

	 	
c)
	
XML Global Technologies wishes to grant to Yellow Dragon non-exclusive rights to the Technology.

In consideration for the payment of $1.00 (all amounts are expressed in United States dollars), the receipt and sufficiency of which is acknowledged, Yellow Dragon and XML Global agree as follows:

Intellectual Property Rights and Royalty Payments

	
1)
	
XML Global Technologies, Inc. warrants that it owns and may sell, license or otherwise derive benefit from the Technology.

	
2)
	
In consideration for the payments outlined below, XML Global grants a non-exclusive license to the Technology. As part of this XML Global will provide Yellow Dragon with the source code underlying the Technology.

	
3)
	
XML Global will allow Yellow Dragon to use the trademark "GoXML Messaging" when marketing the Technology.

	
4)
	
Yellow Dragon will pay a royalty of twenty percent of gross revenue resulting from sales of the Technology up until such a time as the royalty payments to XML Global reach the sum of ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000) (the "Total Payment"), at which time:

	 	
a)
	
Yellow Dragon shall not be liable to pay any further royalties to XML Global;

	 	
b)
	
Yellow Dragon will stop using the trademark "GoXML Messaging"; and

	 	
c)
	
Yellow Dragon will retain rights to the Technology in perpetuity 

	
5)
	
Yellow Dragon will pay the royalties on a monthly basis, 15 days after the end of each month for revenue that has been collected for the preceding month.  The royalties shall be paid with a detailed analysis of all sales included in the remittance. 

	
6)
	
There is no minimum royalty payment due to XML Global.

	
7)
	
XML Global may negotiate to acquire rights to improvements to the Technology once the Total Payment has been received.

	
8)
	
Yellow Dragon will grant XML Global the rights to include any updates, bug fixes and other general improvements to the code base on an ongoing basis for the duration of this agreement.  XML Global's right to updates, bug fixes and general improvements apply only to the Technology and its direct derivatives and not to any complementary products developed by Yellow Dragon.

	
9)
	
Once XML Global has received the Total Payment, XML Global shall have rights in perpetuity to the updates, bug fixes or other general improvements existing at the date the Total Payment has been received, but shall not have rights to further updates, bug fixes or general improvements subsequently created by Yellow Dragon.

	
10)
	
Yellow Dragon shall have the right to assign, sell and sub-license the Technology rights contained in this agreement.  Yellow Dragon shall make a royalty payment to XML Global for all revenue resulting from any such assignments, sales or OEM-type agreements.

	
11)
	
XML Global retains ownership of the Technology and, as a result, the right to assign, sell and sub-license the Technology to other parties.

	
Source Code

	
12)
	
Yellow Dragon will provide XML Global with updated source code monthly, with the last source code update being provideds with the Total Payment.

	
Prospective Customers

	
13)
	
XML Global will give Yellow Dragon a list of prospective customers from its sales management system at the date of this agreement. Yellow Dragon may pursue these prospective customers without additional compensation to XML Global.

	
14)
	
XML Global will provide a list of prospective clients that it will retain and which Yellow Dragon may not pursue in respect of sales of the Technology for four months from the date of this Agreement. After the four-month period, Yellow Dragon will request assurance from XML Global to ensure that XML Global is not working with one of these prospective clients before Yellow Dragon solicits business from them. 

	
15)
	
Yellow Dragon will not attempt to sell to or solicit business from any OEM or Reseller partner of XML Global. A list of current OEM and Reseller partners is: iWay Software; Seagull, Metaserver, NEC Soft.

	
16)
	
Future referrals by XML Global to Yellow Dragon will be subject to a referral fee as outlined below.

	
17)
	
Yellow Dragon agrees to charge reasonable market amount on its sales of the Technology and will not unduly discount the product. Yellow Dragon and XML Global will agree on a standard pricing model.

	
Referral Fee

	
18)
	
Each party may refer prospects to the other, with referrals being made in writing (including by email). If the party receiving the referral has already made contact with the prospective customer, it shall notify the referring party of that fact and no referral fee shall be due.

	
19)
	
If XML Global refers a prospect to Yellow Dragon, Yellow Dragon will pay a referral fee of 10% of cash collected, due 15 days after the end of the month the cash is received.

	
20)
	
If Yellow Dragon refers a prospect to XML Global, XML Global will pay a referral fee of 10% of cash collected, due 15 days after the end of the month the cash is received.

	
Audit

	
21)
	
For the term of this Agreement and one year thereafter, each Party shall have the right, at its own expense and under reasonable conditions of time and place, from time to time to have a mutually agreed to independent auditor audit the records of the other Party relating directly to the calculation of the fees payable pursuant to this Agreement. Such audits shall not occur more than once per calendar year and the independent auditor shall enter into a non-disclosure agreement with each Party prior to any such audit.   Such information shall be used only to verify and enforce the other Party's compliance with the payment terms of this Agreement and shall treat such information as strictly confidential to that Party.  In the event that the audit results indicate that a Party's quarterly report and payment, are less than ninety five percent (95%) of the correct report results and payments, that Party will reimburse the other for reasonable expenses incurred with respect to the audit.

	
Sundry

	
22)
	
Any notice or communication given under this agreement will be in writing and be hand delivered, mailed by registered or certified mail, postage prepaid, delivered by facsimile or by overnight courier as follows:

	 	
a)
	
If to Yellow Dragon - 3247 West 6th Avenue, Vancouver, BC, V6K 1X7

	 	
b)
	
If to XML Global - 1818 Cornwall Avenue, Suite 22, Vancouver, BC, V6J 1C7

	
23)
	
Neither party may assign or otherwise transfer any rights under this Agreement without the other party's prior written consent. Notwithstanding the foregoing Yellow Dragon may assign this agreement to Yellow Dragon Software Corporation (currently being incorporated) without the permission of XML Global. If Yellow Dragon assigns this Agreement, it will provide notice to XML Global.

	
24)
	
This Agreement may be executed in multiple counterparts, each of which may be executed by less than all of the parties and shall be deemed to be an original instrument which shall be enforceable against the parties actually executing such counterparts and all of which together shall constitute one and the same instrument.  A facsimile transmission or copy of the original documents shall be as effective and enforceable as the original.  

	
25)
	
This Agreement may be amended only in writing executed by all parties.

	
26)
	
In the result of any disagreement or dispute, the laws of the Province of British Columbia shall govern this agreement.

IN WITNESS WHEREOF, the undersigned have executed this agreement on the date noted above.

Yellow Dragon Software

__________________________

Duane Nickull

__________________________

Matt MacKenzie

XML-Global Technologies, Inc.

__________________________

Peter Shandro, Chairman of the BoardFirst Amendment to Lease Agreement

 
Exhibit 10.13

 
 
FIRST AMENDMENT TO LEASE AGREEMENT 
 
 
THIS FIRST AMENDMENT TO LEASE AGREEMENT (the “Amendment”) is entered into as of April 7, 2003 by and between BRE/San
Tomas I L.L.C., a Delaware limited liability company, as landlord (“Landlord”) and Turnstone Systems, Inc., a Delaware corporation, as tenant (“Tenant”). 
 
BACKGROUND 
 

	 	A.	 	Pursuant to that certain Lease Agreement dated as of April 28, 2000 (the “Lease”) by and between the Landlord. (as successor-in-interest to South
Bay/San Tomas Associates) and the Tenant, the Tenant is leasing the building located at 2320 Central Expressway, Santa Clara, CA, consisting of approximately 62,522 rentable square feet. 

 

	 	B.	 	The Landlord and the Tenant desire to amend certain terms of the Lease pursuant to the terms and conditions of this Amendment. 

 
NOW, THEREFORE, in consideration of the covenants set forth in
this Amendment and other valuable consideration, the receipt at and adequacy of which are hereby acknowledged, the Landlord and the Tenant hereby agree to amend the Lease as follows: 
 

	 	1.	 	Capitalized terms used and not otherwise defined herein shall have the meanings assigned thereto in the Lease. 

 

	 	2.	 	As a condition to the effectiveness of this Amendment, the Tenant shall pay to the Landlord in immediately available funds an amount equal to $14,152,106.00. The
Tenant and the Landlord agree that the payment shall constitute prepaid Base Rent for the period May 1, 2003 through December 31, 2003 and upon the Landlord’s receipt of such funds, full satisfaction of the Tenant’s obligation to pay Base
Rent under the Lease and this Amendment for the balance of the Lease Term. To the knowledge of the Landlord, as of the date of this Amendment, the Tenant is not in default under the Lease and, subject to receipt of the payment contemplated under
this section, Base Rent shall be paid in full through the Lease Term and Additional Rent shall be paid in full through April 30, 2003, subject to adjustments of Additional Rent as provided under the Lease. 

 

	 	3.	 	Upon receipt of the sum of $14,152,106.00 due under Section 2 of this Amendment and the Security Deposit required under Section 5 of this Amendment, the Landlord
shall immediately return the Letter of Credit. 

 

	 	4.	 	The definition of “Building” is hereby amended by deleting the address “2320 Central Expressway” and replacing it with the address “2220
Central Expressway.” 

 

	 	5.	 	The termination date for the Tenant’s occupancy of the Premises shall be December 31, 2003 and the definition of “Lease Term” is hereby amended
by deleting the date “June 30, 2010” and replacing it with the date “December 31, 2003”. 

 

	 	6.	 	Section 5 of the Lease is hereby deleted in its entirety and replaced with the following: “Concurrently with the execution of this Amendment, Tenant shall pay
to Landlord the sum of $100,000.00 (the “Security Deposit”) to secure the faithful performance by Tenant of each term, covenant and condition of the Lease and as amended by this Amendment. If Tenant shall fail to make any payment or
fail to keep or perform any term, covenant or condition on its part to be made or performed or kept under the Lease and as amended by this Amendment, Landlord may, but shall not be obligated to and without waiving or releasing Tenant from any
obligations under the Lease and as amended by this Amendment, use, apply or retain the whole or any part of the Security Deposit (A) to the extent of any sum due to Landlord; (B) to make any required payment on Tenant’s behalf; or (C) to
compensate Landlord for any loss, damages, attorneys’ fees or expenses sustained by Landlord due to Tenant’s default. In such event, Tenant shall, within five (5) days of written demand by Landlord, remit to Landlord sufficient funds to
restore the Security Deposit to its original sum. No interest shall accrue on the Security Deposit. Landlord shall not be required to keep the Security Deposit separate from its general funds. The Security Deposit, less any sums owing to Landlord or
which Landlord is otherwise entitled to retain, shall be returned to Tenant within fifteen (15) days after the termination of the Lease and as amended by this Amendment, and vacancy of the Premises by Tenant in accordance with the terms of the Lease
and as amended by this Amendment.” 

 

	 	7.	 	Section 20 of the Lease is hereby amended by deleting the words “at one hundred fifty percent (150%) of the monthly rent for the last month of the Lease
Term” and replacing them with the following: “at a monthly rent equal to $46,891.50, together with Additional Rent and any other sums due under the Lease.” 

 

	 	8.	 	On April 30, 2003, the Tenant shall surrender exclusive possession of the second floor of the Premises in accordance with Section 32 of the Lease, and the Premises
shall be reduced effective as of such date to substantially all of the first floor of the Building, consisting of approximately 31,261 rentable square feet and as more particularly shown in Schedule A hereto, for the remainder of the Lease
Term. As of the date of this Amendment, 

 

2 

the Landlord and the Tenant have conducted a walk through of the second floor of the
Premises and agree that, except as provided in Schedule B hereto, no other alterations, repairs or modifications by the Tenant are required prior to the surrender of the second floor and Tenant shall be deemed to have surrendered the second
floor of the Premises in the condition required by the Lease. 
 

	 	9.	 	The Landlord covenants and agrees that it shall not declare a default under the Lease arising out of Sections 13.1.3, 13.1.4, 13.1.5, 13.1.6 and 13.1.7 thereof from
the date hereof through December 31, 2003. On and after January 1, 2004, in the event the Tenant remains in the Premises after the end of the Lease Term, the Landlord’s right to declare a default under the Lease arising out of Sections 13.1.3,
13.1.4, 13.1.5, 13.1.6 and 13.1.7 shall be fully enforceable. 

 

	 	10.	 	Effective as of May 1, 2003: 

 

	 	a.	 	The term “Tenant’s Share” shall be amended as follows: (i) by deleting from the first sentence of the definition of such term the words
“thirty-six and 48/100 percent (36.48%)” and replacing them with “eighteen and 24/100 percent (18.24%)” and (ii) by deleting from the last sentence of the definition of such term the words “one hundred percent (100%)”
and replacing them with the words “fifty percent (50%)”. 

 

	 	b.	 	Section 7.2 of the Lease shall be amended by deleting the first sentence of such Section and replacing such sentence with the following: “The share of Property
Taxes (as defined in Section 7.3 below) allocable to the Premises shall be fifty percent (50%) of the total Property Taxes payable with respect to the Building and the Parcel. Therefore, Tenant shall pay, as Additional Rent, fifty percent (50%) of
all Property Taxes levied or assessed with respect to the Building and the Parcel which are attributable to the Lease Term.” 

 

	 	c.	 	For such period of time during the remainder of the Lease Term that the second floor of the Building remains unoccupied, the Tenant shall pay 100% of the utilities
attributable to the Building. 

 

	 	d.	 	The Tenant shall have access to the second floor of the Building during normal business hours for purposes of maintaining and repairing the Tenant’s data
control room. 

 

	 	e.	 	Landlord shall be responsible for all costs and expenses associated with the re-leasing of the second floor of the Premises, including any required improvements and
costs associated with the creation of a separate entranceway to the second floor prior to the end of the Lease 

 

3 

	 	 
Term. After December 31, 2003, and during any potential holdover period, the Tenant will surrender all rights to use the courtyard side lobby
area and the Landlord shall be responsible for any costs to divide the courtyard side lobby from the Premises. 

 

	 	f.	 	In no event shall Tenant have any obligation to pay directly, perform or reimburse to Landlord any costs incurred by Landlord as a consequence of any condemnation,
casualty to the Building, or any replacement or repair of the Premises which must be capitalized under generally accepted accounting principals, except to the extent the foregoing is caused by the negligence or willful misconduct of the Tenant and
is not covered by insurance or other sums collectable from a third party. 

 

	 	11.	 	Except as amended by this Amendment, the Lease remains in full force and effect and is hereby ratified and affirmed by the Landlord and the Tenant. The Tenant
represents that as of the date hereof, it has no offsets, counterclaims or defenses to its obligations under the Lease. 

 

	 	12.	 	Landlord and Tenant shall each be responsible for its own transaction fees associated with the negotiation and execution of this Amendment, including, but not
limited to, its own attorneys fees. 

 

	 	13.	 	This Amendment may be executed in any number of counterparts and by facsimile signature, each of which shall be deemed to be an original and all of which together
shall be deemed one and the same instrument. 

 
Remainder of page intentionally left blank; 
 
Signatures follow on next page 
 
 

4 

 
IN WITNESS
WHEREOF, the Landlord and the Tenant have caused this Amendment to be executed as of the day and year first above written. 
 
 

	 LANDLORD:

	
	 BRE/San Tomas I L.L.C.

	
	 By:
	 	 /S/    KAREN SPROGIS

	 Name:
	 	 Karen Sprogis

	 Title:
	 	 Managing Director & Vice President

	
	 TENANT:

	
	 Turnstone Systems, Inc.

	
	 By:
	 	 /S/    ERIC YEAMAN

	 	 	 Name: Eric Yeaman

	 	 	 Date: April 7, 2003

 
 

5 

 
Schedule A

 
 
See Attached Floor Plan 

 
Schedule B

 
 
1.    The Tenant will be responsible for any repairs and maintenance to the Premises as a result of the removal of any personal property of the Tenant, including, but not limited to, furniture and equipment, from
either the first or the second floor of the Building during the Lease Term or any holdover period.

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