Exhibit 10(ao)
LICENSE AGREEMENT
License Agreement made this 12th day of September, 2000 by and between Pro
Tech Communications, Inc., a corporation organized under the laws of the state
of Florida, with offices at 3311 Industrial 25th Street, Fort Pierce, Florida
34946 ("Licensee" or "Pro Tech") and NCT Hearing Products, Inc., a Delaware
corporation with offices at 20 Ketchum Street, Westport, Connecticut 06880 ("NCT
Hearing").
WHEREAS, Licensee is engaged in the design, development, manufacture and
marketing of telephone headsets for various markets around the world; and
WHEREAS, NCT Hearing is a wholly owned subsidiary of NCT Group, Inc.
("NCT"), a Delaware corporation, and is engaged in the development of active
noise cancellation and speech enhancement technologies that have been applied to
various fields and industries, and is owner or a direct licensee from NCT of
certain United States and foreign patents and copyrights covering various
aspects of these technologies which both parties believe can be applied to
products manufactured and sold by Licensee; and
WHEREAS, Licensee is desirous of obtaining an exclusive license from NCT
Hearing to make, use, develop and sell telephone headsets incorporating NCT
Hearing technologies for telephony, multimedia and cellular headset markets.
NOW THEREFORE, in consideration of the mutual covenants contained herein,
as well as other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
<PAGE>
ARTICLE 1. DEFINITIONS
As used herein, the terms described below have the following meanings.
1.1 "Affiliate" shall mean any Person which directly or indirectly, is
controlled by, is in control of, or under common control with the Person
with reference to which the term "Affiliate" is used. As used in this
definition, "control", including the terms "controlling", "controlled by"
and "under common control with", with respect to the relationship between
or among two or more Persons, means the possession, directly or indirectly
or as trustee or executor, of the power to direct or cause the direction of
the affairs or management of a Person, whether through the ownership of
voting securities, as trustee or executor, by contract or otherwise,
including, without limitation, the ownership, directly or indirectly, of
securities having the power to elect a majority of the board of directors
or similar body governing the affairs of such Person.
1.2 "Confidential Information" shall mean the information described in Article
5 below and shall include the Deliverables and any and all samples, models,
prototypes, drawings, specifications, formulas, algorithms, software,
operating techniques, processes, data, technical and other information,
including any information relating to the status of research or other
investigations being conducted, whether given in writing, orally, or in
magnetic or other electronic processing form to the extent that such
information is not in the public domain through other than a breach of this
Agreement.
1.3 "Deliverables" shall mean the models, specifications, codes and other
documentation and materials described on Schedule A hereto to be delivered
by NCT Hearing to Licensee under Section 4.3 of this Agreement.
1.4 "Know-how", in general, will have its usual and accepted meaning, that is,
inter alia, all factual knowledge and information not capable of precise,
separate description but which, in an accumulated form, after being
acquired as the result of trial and error, gives to the one acquiring it an
ability to produce and market something which one otherwise would not have
known how to produce and market with the same accuracy or precision
necessary for commercial success.
1.5 "Licensed Patents" shall mean all those patents relating to the reduction
of noise and enhancement of speech by electronic means in headsets owned by
NCT Hearing and listed on Schedule B hereto together with those patents
issued under patent applications filed relating to the reduction of noise
and enhancement of speech by electronic means in headsets and also listed
on Schedule B hereto including any continuations, continuations-in-part,
divisions, extensions, reissues, re-examinations or renewals of any of the
foregoing.
1.6 "Licensed Products" shall mean exclusively those lightweight, portable
headsets, and related accessories to such headsets, which embody or employs
all or part of the Licensed Patents and/or the Licensed Technology.
1.7 "Licensed Technology" shall mean that unpatented technology relating to the
reduction of noise and enhancement of speech by electronic means in
headsets owned by or licensed to NCT Hearing and described on Schedule C
hereto.
1.8 "Market" shall mean the worldwide market for Licensed Products used
exclusively in the telephony, cellular and multimedia fields.
1.9 "NCT Hearing Technology" shall mean any and all existing technology, other
than Sponsor Technology, relating to the attenuation, isolation, control
and/or cancellation of noise and/or signals, now or hereinafter owned or
licensed by or to NCT Hearing and/or its Subsidiaries or affiliates,
including without limitation all know-how, trade secrets, methods,
operating techniques, processes, software, materials, technical data,
engineering information, formulas, specifications, drawings, machinery and
apparatus, patents, patent applications, copyrights and other intellectual
property relating thereto.
1.10 "NCT Hearing Technology License" shall mean the license to the Licensed
Patents and the Licensed Technology granted by NCT Hearing to Licensee
under Article 2 of this Agreement.
1.11 "Person" shall mean any individual, partnership, firm, corporation, limited
liability company, joint venture, association, trust, unincorporated
organization or other entity, as well as any syndicate or group that would
be deemed to be a person under Section 13(d)(3) of the Securities Exchange
Act of 1934, as amended.
1.12 "Sponsor Technology" shall mean with respect to a party hereto (i) all
existing technology owned or licensed by or to a party and/or its
Affiliates which, by virtue of contract restrictions binding on such party,
cannot be disclosed or transferred to the other party on the same terms and
conditions as NCT Hearing Technology or Licensee Technology, as the case
may be; and (ii) all existing technology which results from the combination
of a party's technology and a third party's technology, and which by virtue
of contract restrictions binding on the party in question, cannot be
disclosed or transferred to the other party on the same terms and
conditions as NCT Hearing Technology or Licensee Technology, as the case
may be.
1.13 "Technical Information" shall mean technical, design, engineering, and
manufacturing information and data pertaining to the design, manufacture,
commercial production and distribution of Licensed Products in the form of
designs, prints, plans, material lists, drawings, specifications,
instructions, reports, records, manuals, other written materials, computer
programs and software and other forms or media relating thereto.
ARTICLE 2. LICENSES
2.1 The NCT Hearing Technology License - License to Licensed Patents and
Licensed Technology. Subject to the terms and conditions of this Agreement,
NCT Hearing hereby grants to Licensee a license to make, use, distribute,
sell and/or have sold Licensed Products solely in the Market.
2.2 Exclusivity. The NCT Hearing Technology License shall be exclusive as
against all others for the manufacture, use and sale of Licensed Products
solely in the Market.
2.3 Assignment and Sublicensing. The rights and licenses granted hereunder may
not be sublicensed, conveyed, assigned or otherwise transferred by Licensee
to any third party without NCT Hearing's prior written consent in each
instance. In addition, Licensee shall have the right to have Licensed
Products manufactured for it by others but only after obtaining NCT
Hearing's prior written consent and only under nondisclosure agreements
implemented in accordance with the provisions of Articles 4 and 5 hereof.
2.4 Acceptance. Licensee hereby (i) accepts the rights under the NCT Hearing
Technology License granted to it by NCT Hearing under this Article 2, and
(ii) acknowledges that the rights that NCT Hearing has granted to Licensee
hereunder are exclusive and limited to the manufacture, use, distribution
and sale of Licensed Products in the Market subject to the limitations set
forth herein.
2.5 Patent and Copyright Notices. Licensee shall mark each Licensed Product
sold, leased, distributed or otherwise transferred and shall cause all
licenses, contracts and agreements with other parties for the sale, lease,
distribution, use or other disposition of Licensed Products to contain a
provision requiring, if feasible in Licensee's reasonable opinion, such
other parties to mark each Licensed Product with a suitable legend
identifying the Licensed Patents and Licensed Technology with the
appropriate patent or copyright notice, as the case may be. If, in
Licensee's reasonable opinion, the Licensed Product is too small to have a
legend placed on it, Licensee will use all reasonable efforts to have a
legend placed on the software and/or packaging accompanying the Licensed
Product.
2.6 Product Marking. Licensee shall prominently mark each Licensed Product
sold, leased, distributed or otherwise transferred and shall cause all
licenses, contracts and agreements with other parties for the sale, lease,
distribution, use or other disposition of Licensed Products to contain a
provision requiring, if feasible in Licensee's reasonable opinion, such
other parties to prominently mark each Licensed Product with a suitable
legend identifying the Licensed Product as being a product which
incorporates NCT Hearing's technology for the reduction of noise by
electronic means and including the words: "with NCT Hearing Technology".
If, in Licensee's reasonable opinion, the Licensed Product is too small to
have such a legend placed on it, Licensee will use all reasonable efforts
to have such a legend placed on the software and/or packaging accompanying
the Licensed Product.
ARTICLE 3. FEES AND ROYALTIES
3.1 Fees. Licensee shall issue to NCT Hearing __________ shares of common stock
of the Licensee, representing sixty percent (60.0%) of the fully diluted
outstanding common stock of the Licensee, as a non-refundable up-front
license fee upon execution of this Agreement.
3.2 Unit royalties. Should NCT Hearing's equity interest in all of the issued
and outstanding capital stock of Licensee (as determined on a fully diluted
basis) fall below fifty and one tenth percent (50.1%), Licensee shall
promptly thereafter commence payment to NCT Hearing of a royalty with
respect to each Licensed Product (which term for purposes of royalty
calculations shall not include prototypes or engineering samples furnished
without consideration to unaffiliated customers) sold, leased, distributed
or otherwise transferred by Licensee, any sublicensee permitted under
Section 2.3 above or otherwise as follows:
6% of Pro Tech's Sale Price for each Unit sold, leased, distributed or
otherwise transferred.
For purposes of the foregoing royalty calculations "Unit" shall mean one
(1) Licensed Product, and "Pro Tech's Sale Price" shall mean the gross
invoice price to the purchaser or other transferee before the deduction of
any discounts, rebates or set-offs but not including amounts to be paid by
the purchaser, lessee or other transferee for transportation, packing or
insurance; excise, sales, V.A.T. or other taxes not based on income; or
customs, duties, fees, commissions or other customs expenses. In the event
that any purchaser, lessee or other transferee returns to Pro Tech any Unit
sold, leased, distributed or otherwise transferred to such purchaser,
lessee or other transferee by Pro Tech either because such Unit was
defective or otherwise, NCT Hearing will credit the account of Pro Tech in
the amount of any royalty paid or payable hereunder with respect to such
Unit. Such credit shall be applied to the immediately succeeding calendar
quarter after Pro Tech advises NCT Hearing in writing of such return(s).
3.3 Payment. Unit royalties shall be paid to NCT Hearing within forty-five (45)
days from the last day of each calendar quarter of each calendar year as
provided in Article 7. Licensee agrees that NCT Hearing may inspect its
royalty/revenue records once a year upon thirty (30) days notice, at NCT
Hearing's own expense, including computer generated or computer compelled
information as to Units of Licensed Products sold, leased, distributed or
otherwise transferred and Units of Licensed Products manufactured and/or
held in inventory, as well as extant invoices, inventory records, shipment
documents and similar information and material reasonably necessary to
confirm or verify the Unit royalties due hereunder.
ARTICLE 4. DISCLOSURE OF INFORMATION,
DATA AND KNOW-HOW
4.1 Disclosure. The parties shall disclose to each other such appropriate
Technical Information as may be reasonably required to accomplish the
purposes of this Agreement. It is agreed, however, that neither party shall
be obligated to disclose information, the disclosure of which has been
restricted by a third party.
4.2 Treatment. All disclosed Technical Information which is Confidential
Information (as defined in Article 5 below) shall be kept confidential by
the receiving party in accordance with the further provisions of Article 5
below and will remain the property of the disclosing party. Any source code
disclosed by NCT Hearing shall also be subject to the provisions of NCT
Hearing's form of Source Code Delivery Agreement, a copy of which is
attached as Schedule D hereto.
4.3 Deliverables. NCT Hearing shall deliver the Deliverables to Licensee and in
accordance with the delivery dates set forth on Schedule A hereto.
ARTICLE 5. CONFIDENTIALITY
5.1 Definitions. Each party possesses and will continue to possess confidential
information relating to its business and technology which has substantial
commercial and scientific value in the business in which it is engaged
("Confidential Information"). Subject to Section 5.4, Confidential
Information includes, but is not limited to: Deliverables, Technical
Information, trade secrets, processes, formulas, data and know-how,
discoveries, developments, designs, improvements, inventions, techniques,
marketing plans, strategies, forecasts, new products, software
documentation, unpublished financial statements, budgets, projections,
licenses, prices, costs, customer lists, supplier lists and any other
material marked "Confidential Information", "Proprietary Information" or in
some other reasonable manner to indicate it is confidential. Any
Confidential Information disclosed between the parties hereto orally or
visually, in order to be subject to this Agreement, shall be so identified
to the receiving party at the time of disclosure and confirmed in a written
summary appropriately marked as herein provided within ten (10) days after
such oral or visual disclosure.
5.2 Treatment. Each party shall during the term of this Agreement and for a
period of five (5) years thereafter, hold in confidence and not disclose to
third parties except as specifically permitted under this Section 5.2 and
Section 5.4 below any and all Confidential Information of the other party
disclosed directly or indirectly to it by the other party.
Each party shall take the following minimum safeguards with respect to the
Confidential Information of the other party:
(a) only those of its employees who need to receive the other party's
Confidential Information in order to carry out the purposes of this
Agreement shall have access to such information and such access shall
be limited to only so much of such information as is necessary for the
particular employee to properly perform his or her functions;
(b) all documents, drawings, writings and other embodiments which contain
Confidential Information of the other party shall be maintained in a
prudent manner in a secure fashion separate and apart from other
information in its possession and shall be removed therefrom only as
needed to carry out the purposes of this Agreement;
(c) all documents, drawings, writings and other embodiments of information
the security or safekeeping of which are subject to governmental
regulations shall be kept in accordance with those regulations;
(d) all employees and contractors who shall have access to Confidential
Information of the other party shall be under written obligation to
it: (i) to hold in confidence and not disclose all Confidential
Information made available to them in the course of their employment;
(ii) to use such Confidential Information only in the course of
performing their employment duties; and (iii) to assign to their
employer or the party retaining them all inventions or improvements
relating to their employer's business and conceived while in their
employer's employ unless such assignment is prohibited by applicable
law.
Notwithstanding the foregoing, a party receiving Confidential Information
of the other party may disclose Confidential Information (a) in any
proceeding under Article 12 hereof, to the extent such information is
relevant to the dispute between the parties hereto and appropriate
protective order has been entered in such proceeding topreserve the secrecy
of the Confidential Information, and (b) to its subcontractors and material
and component suppliers so much of such Confidential Information as is
necessary to enable such party to perform its duties and obligations
related to the accomplishment of the purposes of this Agreement provided
that such subcontractors and suppliers are obligated to such party in
writing: (i) to hold in confidence and not disclose such information; and
(ii) not to use such information except as authorized by such party. In no
event shall the party receiving Confidential Information of the other party
disassemble, reverse engineer, re-engineer, redesign, decrypt, decipher,
reconstruct, re-orient, modify or alter any Confidential Information of the
disclosing party or any circuit design, algorithm, logic or program code in
any of the disclosing party's products, models or prototypes which contain
Confidential Information or attempt any of the foregoing without first
obtaining written consent of the disclosing party in each instance.
5.3 Return. All documents, drawings, writings and other embodiments of a
party's Confidential Information, as well as those produced, created or
derived from the disclosing party's Confidential Information which
incorporate the disclosing party's Confidential Information and all copies
thereof shall be returned promptly to it by the other party upon the
termination of this Agreement provided that the parties shall continue to
be bound by the provisions of Section 5.2 above.
5.4 Exclusions. Confidential Information shall not include information that:
(a) was at the time of disclosure in the public domain through no fault of
the party receiving it;
(b) becomes part of the public domain after disclosure to the party
receiving it through no fault of such party;
(c) was in the possession of the party receiving it (as evidenced by
written records) at the time of disclosure and was not acquired
directly or indirectly from the other party, or a third party, as the
case may be, under a continuing obligation of confidence of which the
party receiving it was aware;
(d) was received by the party receiving it (as evidenced by written
records) after the time of disclosure hereunder from a third party who
did not require it to be held in confidence and who did not acquire it
directly or indirectly from the other party under a continuing
obligation of confidence of which the party receiving it was aware;
(e) required by law, governmental regulations, court order or the rules of
any relevant securities exchange to be disclosed, but only to the
extent of such required disclosure; provided, that a party required to
so disclose Confidential Information shall use best efforts to notify
the other party of such potential disclosure so that such party may
seek a protective order or other remedies to maintain in confidence
any such Confidential Information;
(f) was developed independently by the receiving party and without the use
of any Confidential Information received from the disclosing party
under this Agreement; or
(g) was or is disclosed by the party owning it to third parties without
restrictions on use or disclosure comparable to those contained
herein.
ARTICLE 6. DISCOVERIES AND DUAL IMPROVEMENTS
6.1 Joint Discoveries; Dual Improvements. In the event that Licensee on the one
hand, and NCT Hearing and/or NCT on the other, jointly discover, develop or
create any intellectual property whether patentable or non-patentable, all
rights and interest in and to such intellectual property shall be owned
equally by Licensee and NCT Hearing and each party hereby grants to the
other a royalty free, fully paid up, perpetual, irrevocable license to use
and exploit any such intellectual property anywhere in the world.
6.2 Individual Discoveries. In the event that either Licensee on the one hand,
or NCT Hearing and/or NCT on the other, independently discover, develop or
create any intellectual property whether patentable or non-patentable, all
right, title and interest in and to such intellectual property shall be
owned by the party discovering, developing or creating the same.
6.3 Further Assurances. The parties shall take all action legally permitted
that may be necessary or appropriate to insure full compliance with the
provisions of this Article 6 notwithstanding the fact that intellectual
property covered by this Article 6 may be discovered, developed or created
by an employee or independent contractor of one of the parties hereto.
ARTICLE 7. PAYMENTS, REPORTS AND RECORDS
Royalties, if applicable as defined in Section 3.2, shall be due and payable in
U.S. dollars in immediately available funds within forty-five (45) days after
the last business day of each calendar quarter of each calendar year during the
term of this Agreement. Royalties may be paid by wire transfer to an account
designated by NCT Hearing or by certified check delivered to NCT Hearing on the
date such Royalties are due. Late payments of Royalty shall bear interest on the
unpaid amount at the annual rate of twelve percent (12%) compounded quarterly
until fully paid. If requested by NCT Hearing, the Chief Financial Officer or
another authorized officer of the Licensee shall provide NCT Hearing with a
certified written royalty report (the "Royalty Report") for each of Licensee's
fiscal years (or portions thereof) during the term of this Agreement, for which
royalties were due to NCT Hearing, within sixty (60) days of the end of each
calendar year of this Agreement. Such Royalty Reports shall be prepared in
accordance with generally accepted accounting principles applied in a consistent
manner. A similar Royalty Report shall be rendered and Royalty payment shall be
made within sixty (60) days after termination of this Agreement, provided, that,
royalties were payable to NCT Hearing during the term of this Agreement.
ARTICLE 8. TERM
The term of this Agreement shall begin on the date hereof and, unless extended
or earlier terminated by the written agreement of the parties or the provisions
of Article 9 below, shall expire immediately upon either: (i) with respect to
rights granted under any patent hereunder, the expiration of that patent under
applicable law; or (ii) with respect to the other rights granted hereunder, upon
the expiration of the last to expire of the patents licensed hereunder.
ARTICLE 9. TERMINATION
9.1 General. This Agreement may be terminated prior to the end of the term
provided in Article 8 above under any of the following provisions of this
Article.
9.2 Breach. In the event of a material breach of this Agreement, if the
defaulting party fails to cure the breach within thirty (30) days, in the
case of a breach involving non-payment of amounts to be paid hereunder, or
sixty (60) days, in the case of any other kind of material breach,
following its receipt of written notice from the non-defaulting party
specifying the nature of the breach and the corrective action to be taken,
then the non-defaulting party may terminate this Agreement forthwith by
delivering its written declaration to the defaulting party that this
Agreement is terminated.
9.3 Insolvency. If one of the parties becomes bankrupt or insolvent, or files a
petition therefor, or makes a general assignment for the benefit of
creditors, or otherwise seeks protection under any bankruptcy or insolvency
law, or upon the appointment of a receiver of the assets of a party
("defaulting party") then the other party shall have the right to
immediately terminate this Agreement upon written notice to the defaulting
party provided, in any such instance, that said right of termination shall
be postponed for as long as the defaulting party continues to conduct its
business in the ordinary course.
9.4 Survival of Certain Terms. Notwithstanding the termination of this
Agreement under any of the provisions of this Article 9, the terms and
conditions of Section 4.2 and Articles 5, 6, 7, 18, and 19 shall survive
termination of this Agreement and shall continue to be applicable and
govern the parties with respect to the subject matter thereof.
9.5 Document Return. Each party shall return to the other party within thirty
(30) days of the date of termination under either Article 8 or this Article
9 all of the Confidential Information received pursuant to this Agreement
together with all other tangible property loaned for the implementation of
this Agreement.
ARTICLE 10. FORCE MAJEURE
In the event of enforced delay in the performance by either party of its
obligations under this Agreement due to unforeseeable causes beyond its
reasonable control and without its fault or negligence, including, but not
limited to, acts of God, acts of the government, acts of the other party, fires,
floods, strikes, freight embargoes, unusually severe weather, or delays of
subcontractors due to such causes (an "Event of Force Majeure"), the time for
performance of such obligations shall be extended for the period of the enforced
delay; provided that the party seeking the benefit of the provisions of this
paragraph shall, within ten (10) days after the beginning of any such enforced
delay, have first notified the other party in writing of the causes and
requested an extension for the period of the enforced delay and shall use all
reasonable endeavors to minimize the effects of any Event of Force Majeure.
ARTICLE 11. APPLICABLE LAW
The terms and conditions of this Agreement and the performance thereof shall be
interpreted in accordance with and governed by the laws of the State of Delaware
and the United States of America, without giving effect to conflicts of laws
principles.
ARTICLE 12. DISPUTE RESOLUTION
The parties agree to attempt in good faith to resolve any dispute arising out of
or in connection with the performance, operation or interpretation of this
Agreement promptly by negotiation between the authorized contacts of the
parties.
If a dispute should arise, the authorized contacts will meet at least once and
will attempt to resolve the matter. Either authorized contact may request the
other to meet within fourteen (14) days, at a mutually agreed time and place. If
the matter has not been resolved within thirty (30) days of a request being made
for such a meeting, the authorized contacts shall refer the matter to the
representatives of the parties who are responsible for matters at the policy or
strategic level who shall meet within fourteen (14) days of the end of the
thirty (30) day period referred to above, at a mutually agreed time and place.
If the matter has not been resolved within thirty (30) days of a request being
made for this meeting, the parties shall proceed as follows:
(a) Any action, suit or proceeding where the amount in controversy as to
at least one party, exclusive of the interest and costs, exceeds one
million dollars (a "Summary Proceeding"), arising out of or relating
to this Agreement or the breach, termination or validity thereof,
shall be litigated exclusively in the Superior Court of the State of
Delaware (the "Delaware Superior Court") as a summary proceeding
pursuant to Rules 124-131 of the Delaware Superior Court, or any
successor rules (the "Summary Proceeding Rules"). Each of the parties
hereto hereby irrevocably and unconditionally (i) submits to the
jurisdiction of the Delaware Superior Court for any Summary
Proceeding, (ii) agrees not to commence any Summary Proceeding except
in the Delaware Superior Court, (iii) waives, and agrees not to plead
or to make, any objection to the venue of any Summary Proceeding in
the Delaware Superior Court, (iv) waives, and agrees not to plead or
to make, any claim that any Summary Proceeding brought in the Delaware
Superior Court has been brought in an improper or otherwise
inconvenient forum, (v) waives, and agrees not to plead or to make,
any claim that the Delaware Superior Court lacks personal jurisdiction
over it, (vi) waives its right to remove any Summary Proceeding to the
federal courts except where such courts are vested with sole and
exclusive jurisdiction by statute and (vii) understands and agrees
that it shall not seek a jury trial or punitive damages in any Summary
Proceeding based upon or arising out of or otherwise related to this
Agreement and waives any and all rights to any such jury trial or to
seek punitive damages.
(b) In the event any action, suit or proceeding where the amount in
controversy as to at least one party, exclusive of interest and costs,
does not exceed One Million Dollars (a "Proceeding"), arising out of
or relating to this Agreement or the breach, termination or validity
thereof is brought, the parties to such Proceeding agree to make
application to the Delaware Superior Court to proceed under the
Summary Proceeding Rules. Until such time as such application is
rejected, such Proceeding shall be treated as a Summary Proceeding and
all of the foregoing provisions of this Article relating to Summary
Proceedings shall apply to such Proceeding.
(c) In the event a Summary Proceeding is not available to resolve any
dispute hereunder, the controversy or claim shall be settled by
arbitration conducted on a confidential basis, under the U.S.
Arbitration Act, if applicable, and the then current Commercial
Arbitration Rules of the American Arbitration Association
("Association") strictly in accordance with the terms of this
Agreement and the substantive law of the State of Delaware. The
arbitration shall be conducted at the Association's regional office
located closest to Licensee's principal place of business by three
arbitrators, at least one of whom shall be knowledgeable in active
noise cancellation and speech enhancement technologies and one of whom
shall be an attorney. Judgment upon the arbitrators' award may be
entered and enforced in any court of competent jurisdiction. Neither
party shall institute a proceeding hereunder unless at least sixty
(60) days prior thereto such party shall have given written notice to
the other party of its intent to do so. Neither party shall be
precluded hereby from securing equitable remedies in courts of any
jurisdiction, including, but not limited to, temporary restraining
orders and preliminary injunction to protect its rights and interests
but such shall not be sought as a means to avoid or stay arbitration.
(d) Licensee hereby designates and appoints CT Corporation System with
offices on the date hereof at 1200 South Pine Island Road, Plantation,
Florida 33324 as its agent to receive service of process in any
Proceeding or Summary Proceeding. NCT Hearing hereby designates and
appoints Corporation Service Company with offices on the date hereof
at 1013 Centre Road, Wilmington, DE 19805, as its agent to receive
such service. Each of the parties hereto further covenants and agrees
that, so long as this Agreement shall be in effect, each such party
shall maintain a duly appointed agent for the service of summonses and
other legal processes in the State of Delaware and will notify the
other parties hereto of the name and address of such agent if it is no
longer the entity identified in this article.
<PAGE>
ARTICLE 13. ANNOUNCEMENTS AND PUBLICITY
Except for any disclosure which may be required by law, including appropriate
filings with the Securities and Exchange Commission and the Nasdaq Stock Market,
Inc., neither party may disclose the unit royalty terms set forth in Section 3.2
of this Agreement without the consent of the other, which consent shall not be
unreasonably withheld. Upon the execution of this Agreement NCT Hearing and Pro
Tech each intend to issue a press release in NCT Hearing's and Pro Tech's
customary format and manner, respectively, reporting the execution of this
Agreement and its general subject matter provided that each party shall have
received the other party's prior written approval thereof which approval shall
not be unreasonably withheld or delayed.
ARTICLE 14. SEVERABILITY
If any part of this Agreement for any reason shall be declared invalid or
unenforceable, such decision shall not affect the validity or enforceability of
any remaining portion, which shall remain in full force and effect; provided,
however, that in the event a part of this Agreement is declared invalid and the
invalidity or enforceability of such part has the effect of materially altering
the obligations of any party under this Agreement, the parties agree, promptly
upon such declaration being made, to negotiate in good faith to amend this
Agreement so as to put such party in a position substantially similar to the
position such party was in prior to such declaration.
ARTICLE 15. RIGHTS OF ASSIGNMENT; SUCCESSORS AND ASSIGNS Neither NCT
Hearing nor Licensee shall have any right to assign this Agreement or any of
their respective rights or obligations under this Agreement to any third party
except by operation of law or with the prior written consent of the other party.
In the event Licensee wishes to assign any of its rights or obligations under
this Agreement to an Affiliate of Licensee, NCT Hearing's consent will not be
unreasonably withheld. In the event NCT Hearing wishes to assign any of its
rights or obligations under this Agreement to an Affiliate of NCT Hearing,
Licensee's consent will not be unreasonably withheld. The provisions of this
Agreement shall inure to the benefit of, or be binding upon, the successors and
assigns of each party hereto.
ARTICLE 16. NOTICES
Any notices under this Agreement shall be in writing and shall be deemed
delivered on the date of delivery if delivered by personal service, or sent by
telecopy and confirmed by first class registered or certified mail, or same day
or overnight courier service with postage or charges prepaid and on the third
day following dispatch if sent only by first class registered or certified mail
or same day or overnight courier service with postage or charges prepaid. Unless
subsequently notified in writing in accordance with this Article by the other
party, any notice or communication hereunder shall be addressed to NCT Hearing
as follows:
NCT Hearing Products, Inc.
20 Ketchum Street
Westport, CT 06880
Attn: President
Fax No: 203-226-4447
to Licensee as follows:
Pro Tech Communications, Inc.,
3311 Industrial 25th Street
Fort Pierce, Florida 34946
Attn: Rich Hennessey
Fax No.: 561-464-6644
ARTICLE 17. TAXES
Licensee shall be solely responsible for any sales, use, occupational or
privilege taxes, duties, fees or other similar charges imposed by any
governmental authority in connection with the manufacture, sale, lease,
distribution, use or other disposition by Licensee of Licensed Products or the
Licenses granted hereunder. Any other taxes, including income taxes based on
royalties and other payments to NCT Hearing, shall be the responsibility of NCT
Hearing. ARTICLE 18. INDEMNIFICATION Each of NCT Hearing and Licensee agrees to
indemnify, defend, and hold harmless the other party and each of its officers,
directors, employees, agents, successors and assigns (hereinafter referred to in
the aggregate in this Article as "the Indemnified Party") against any and all
losses, claims, damages, liabilities, costs and expenses (including without
limitation, reasonable attorneys' fees and other costs of defense of every kind
whatsoever and the aggregate amount of reasonable settlement of any suit, claim
or proceeding) which the Indemnified Party may incur or for which the
Indemnified Party may become liable on account of any suit, claim or proceeding
purporting to be based upon a failure to perform obligations under this
Agreement to be performed by the other party (hereafter the "Indemnifying
Party") and its employees or agents. The Indemnified Party shall promptly advise
the Indemnifying Party of any such suit, claim or proceeding and shall cooperate
with the Indemnifying Party in the defense or settlement of such suit, claim or
proceedings providing no settlement shall be made without the consent of the
Indemnified Party, which consent shall not be unreasonably withheld. In any
event, the Indemnified Party shall furnish to the Indemnifying Party such
information relating to such suit, claim or proceeding as the Indemnifying Party
shall reasonably request for use in defending the same.
ARTICLE 19. MAINTENANCE AND DEFENSE
OF LICENSED PATENTS; WARRANTIES
19.1 Enforcement of Patents. Throughout the term of this Agreement, NCT Hearing
may maintain in force the Licensed Patents in its sole and absolute
discretion. In this connection, NCT Hearing shall promptly pay all costs of
any and all continuations, continuations-in-part, divisions, extensions,
reissues, re-examinations, or renewals of the Licensed Patents, including,
without limitation, the costs and expenses of any and all attorneys,
experts or other professionals engaged in connection with any of the
foregoing.
19.2 Infringement. NCT Hearing shall defend and save harmless Licensee against
any suit, damage claim or demand, and any actual loss, cost or expense
(excluding opportunity costs or lost profits) suffered as a result thereof
(including reasonable attorneys fees), based on actual or alleged
infringement of any patent or trademark or any unfair trade practice
resulting exclusively from the exercise or use of any right or license
granted under this Agreement on the condition that Licensee: (a) promptly
notifies NCT Hearing of such suit, claim or demand; provided, that,
Licensee's failure to promptly notify NCT Hearing shall not relieve NCT
Hearing of its obligations under this section except and to the extent it
is actually prejudiced by Licensee's delay, and (b) provides NCT Hearing
with such assistance as NCT Hearing may reasonably request for the defense
or settlement of such suit, claim or demand.
Notwithstanding the foregoing, NCT Hearing shall have no liability to
defend or pay (a) punitive or trebled damages, penalties or fines, and/or
(b) damages or costs to Licensee with respect to any claim of infringement
which is based on an implementation designed or modified by any third party
or Licensee's use of the Licensed Patents or the Licensed Technology for
any purpose other than the design, manufacture, use or sale of Licensed
Products pursuant to this Agreement.
19.3 Ownership; Authority. NCT Hearing represents and warrants to Licensee that
it owns or has the worldwide right to use, including the right to
sublicense, the Licensed Patents and Licensed Technology. NCT Hearing
represents and warrants that it has the right, power and authority to enter
into this Agreement and to grant the licenses and other rights contained
herein to Licensee as herein provided.
19.4 Non-Infringement. NCT Hearing represents and warrants to Licensee, that to
the best of NCT Hearing's knowledge, the Licensed Technology and Licensed
Patents, as contemplated to be used with the Licensed Products, do not
infringe upon any existing patent, copyright, trademark, service mark,
trade name, trade secret, or other intellectual property right of any third
party.
19.5 No Conflicts. NCT Hearing represents, warrants, and covenants to Licensee,
that to the best of NCT Hearing's knowledge, NCT Hearing's performance of
this Agreement does not conflict with any other agreement to which such
party is bound, and while performing this Agreement, NCT Hearing will not
knowingly enter into any other agreement in conflict with this Agreement or
which would impair the ability of NCT Hearing to perform its obligations
under this Agreement.
ARTICLE 20. DISCLAIMER
EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT, NCT HEARING HEREBY DISCLAIMS
ANY EXPRESS OR IMPLIED WARRANTY OF THE ACCURACY, RELIABILITY, TECHNOLOGICAL OR
COMMERCIAL VALUE, COMPREHENSIVENESS OR MERCHANTABILITY OF THE LICENSED PATENTS,
THE NCT HEARING TECHNOLOGY, OR THE LICENSED PRODUCTS, OR THEIR SUITABILITY OR
FITNESS FOR ANY PURPOSE WHATSOEVER. NCT HEARING DISCLAIMS ALL OTHER WARRANTIES
OF WHATEVER NATURE, EXPRESS OR IMPLIED. NCT HEARING DISCLAIMS ALL LIABILITY FOR
ANY LOSS OR DAMAGE RESULTING, DIRECTLY OR INDIRECTLY, FROM THE USE OF THE
LICENSED PATENTS, THE NCT HEARING TECHNOLOGY, OR THE LICENSED PRODUCTS, OTHER
THAN THOSE ARISING FROM CLAIMS OF INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS
OF THIRD PARTIES; WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, THIS
DISCLAIMER EMBRACES CONSEQUENTIAL DAMAGES, LOSS OF PROFITS OR GOODWILL, EXPENSES
FOR DOWNTIME OR FOR MAKING UP DOWNTIME, DAMAGES FOR WHICH LICENSEE MAY BE LIABLE
TO OTHER PERSONS, DAMAGES TO PROPERTY, AND INJURY TO OR DEATH OF ANY PERSONS.
ARTICLE 21. SCOPE OF THE AGREEMENT
This Agreement constitutes the entire agreement between the parties with respect
to the subject matter hereof and supersedes all prior oral or written agreements
or understandings of the parties with regard to the subject matter hereof. No
interpretation, change, termination or waiver of any provision hereof shall be
binding upon a party unless in writing and executed by the other party. No
modification, waiver, termination, recession, discharge or cancellation of any
right or claim under this Agreement shall affect the right of any party hereto
to enforce any other claim or right hereunder.
IN WITNESS THEREOF, Licensee and NCT Hearing have executed this Agreement
effective as of the date first written above.
PRO TECH COMMUNICATIONS, INC. NCT HEARING PRODUCTS, INC.
By: /s/RICHARD HENNESSEY By: /s/IRENE LEBOVICS
Title:President Title:President
<PAGE>
Schedule A
Deliverables
Deliverables include without limitation all know-how, trade secrets, methods,
operating techniques, processes, software, materials, technical data,
engineering information, formulas, specifications, drawings, machinery and
apparatus, patents, patent applications, copyrights and other intellectual
property relating thereto.
Any NCT Hearing source codes specified above will only be delivered after
Licensee has signed and delivered to NCT Hearing a Source Code Delivery
Agreement substantially in the form of Schedule D hereto covering the subject
Deliverables.
<PAGE>
Schedule B
Licensed Patents
Patents
HEADSETS
Generics That Apply
US 4,862,506 Issued August, 1989, entitled "Monitoring, Testing and
Operator Controlling of Active Noise and Vibration Cancellation
Systems". It describes a flexible user interface for maintenance and
operation of the electronics for noise cancellation. It is in use in
the MRI headset product for testing and maintenance.1
US 5,105,377 Issued April 14, 1992, entitled "Digital Virtual
Earth"(DVE). A digital adaptive feedback control system. Instability
is prevented by use of a fixed internal model of the physical system.
This approach has been used noise canceling headsets industrial
mufflers.2
US 5,418,857 Issued May 23, 1995, entitled "Active Control System for
Noise Shaping". The use of an active control system to control the
quality of a sound rather than just try to cancel it. Has applications
for sound quality control in automobiles.3
US 5,440,642 Issued August 8, 1995, entitled "Analog Noise Cancellation
System Using Digital Optimization of Variable Parameters". A digital
control system is used to adjust the response of an analog noise
cancellation system and to control tonal components of the noise. Has
application to active ear defenders.4
US 5,481,615 Issued Jan 2, 1996, entitled "Improved Audio Reproduction
System". The use of a combination of active noise control and adaptive
equalization to improve an audio system. This has particular use in
headsets for hi-fi and for telecommunications.5
US 5,652,799 Issued July 29, 1997, entitled "Noise Reducing System". A
control system for selectively reducing tonal noise without the use of
reference signal or tachometer signal. Has application to active
headsets where speech or other signals must not be canceled.6
HEADSETS
Application Specific
US 4,654,871 Issued March 31, 1987, entitled "Method and Apparatus for
Reducing Repetitive Noise Entering the Ear". It provides for
open-backed headsets wherein a repetitive noise signal detected by a
microphone at the headset is nulled by the headphone diaphragm in an
adaptive manner. A similar approach to provide a noise-free zone at a
seat, is described.7
US 4,701,952 Issued May 26, 1987, entitled "Frequency Attenuation
Compensated Pneumatic Headphone and Liquid Tube Audio System for
Medical Use". Describes a system for delivering music into a passive
headset for MRI patients. Reissued April 27, 1993 as Re. 34,236.
GB 2,172,769 Issued July 6, 1988, entitled "Improvements in Acoustic
Attenuation". An analog active headset utilizing feedforward control.
GB 2,160,070 Entitled "Sound Reproduction System". An analog active
headset with a communications input. The communication signal is
equalized and mixed with the input and/or output of the feedback
control loop. Used in current communications headsets.
GB 2,172,470 Issued January 11, 1989, entitled "Improvements Relating to
Noise Reduction Arrangements". An analog active headset in which a
second microphone is used to adjust the feedback gain automatically so
as to prevent instability.
EP 0,212,840 Issued October 23, 1991, entitled "Noise Reduction Device".
An analog active headset in which the feedback gain is automatically
adjusted. The adjustment may performed by a digital controller.
EP 0,232,096 Entitled "Acoustic Transducer". A closed-back headset in
which the ear cup is vented to improve low frequency performance.
EP 0,192,379 Entitled "Improvements Relating to Noise Reduction
Arrangements". A closed-back active headset that uses an additional
loudspeaker connected to the headset by a tube. The tube acts as an
acoustic low pass filter that prevents noise caused by any non-linear
distortions of the loudspeaker from reaching the ear.
US 4,953,217 Issued August 28, 1990, entitled "Noise Reduction System".
An analog active headset that includes a device to reduce the effect
of low frequency sound buffeting.
US 5,452,361 Issued September 19, 1995, entitled "Reduced VLF Overload
Susceptibility Active Noise Cancellation Headset". In an analog
feedback headset, an extra microphone is used to detect very low
frequency (VLF) sound and subtract it from the feedback signal. This
removes the VLF component without the need for extra high pass
filtering - which would introduce delay and therefore reduce
performance.8
US 5,313,945 Issued May 24, 1994, entitled "Active Attenuation System for
Medical Patients". Active ear defender for MRI patients in which the
sound in the headset is monitored through hollow plastic tubes and
anti-noise is supplied to the headset through hollow plastic tubes.
Used in the MRI headset product.9
US 5,375,174 Issued December 20, 1993, entitled "Remote Siren Headset".
An active headset for use in emergency vehicles in which the control
system is separated from the headset and communicates remotely. This
allows the headset to be more portable, have longer battery life, and
allows a single controller to control several headsets.
US 5,604,813 Issued February 18, 1997, entitled "Industrial Headset". A
communications headset which provides active noise cancellation
without interruption of normal communication. A bridge circuit is used
to by-pass the ANC circuit as required, and the communications signal
is boosted when the ANC system is in operation.10
US 5,699,436 Issued December 16, 1997, entitled "Hands Free Noise
Canceling Headset". The use of the residual microphones in an active
noise canceling headset system to pick up the speech of the wearer for
use with communication systems.11
US 5,815,582 Issued September 29, 1998, entitled "Active Plus Selective
Headset". The use of an open back headset and a feedforward noise
cancellation system to provide comfort and enhanced communications for
the user.12
EP 0705472 Issued May 10, 2000, entitled "Variable Gain Active Noise
Cancellation System with Improved Residual Noise Sensing". In an
active headset, the error microphone is displaced radially with
respect to the loudspeaker so as to measure a sound more closely
related to that at the ear. Additional features, such as side
perforations, are used to obtain improved and more robust
performance.13
US 6,069,959 Issued May 30, 2000, entitled "Active Headset". Active
headset canceling external noise in both the higher and lower
frequency ranges while reducing the subjective pressure felt within
the ears by the user. A bridge amplifier circuit is used which is user
adjustable without reducing the breadth of the given frequency range
over which noise reduction is effective.14
Patents Pending Under Filed Applications
Patents Pending
(268)Headset: Filed September 7, 1995. The use of a dome to cover the
front of a loudspeaker in an active headset, thereby obtaining a more
consistent acoustic response. This enables higher feedback gain to be
used and results in improved cancellation performance.
(272)Noise Cancellation System for Active Headsets: Filed August 18, 1997.
An active headset capable of compatibility with existing socket
configurations of an external device and capable of powering active
noise cancellation circuitry whether or not resident in the active
headset.
(617)Cushioned Earphones: Filed March 18, 1998. Use of auxetic foam in
headset ear cushions which more readily moulds around irregularities
in the shape of the ear and so reduces air leaks.
(618)Headset for Aircraft: Filed March 18, 1998. An active noise reduction
headset for use by aircraft passengers. Each earphone comprises at
least two parts, one carried by the headband, the other part
connecting both mechanically and electrically to the first part.
Components requiring frequent replacement are carried by one part and
the other part is available for re-use.
Disclosures for Which Patent Applications are to be Filed
621 A Non-Adaptive Variable Response Active Headset
661 An Active Noise Reduction Earbud
<PAGE>
Patents
CLEARSPEECH TECHNOLOGY
Generics That Apply
US 4,423,289 Issued December 27, 1983, entitled "Signal Processing
Systems". A means for providing an adaptive filter transfer function
which can be adjusted to any desired complex form. The filter operates
by splitting the signal into frequency bands and modifying the gain in
each frequency band. This is the basic structure used in the Adaptive
Speech Filter.15
Application Specific
US 5,768,473 Issued June 16, 1998, entitled "Adaptive Speech Filter". A
filter for enhancing noisy speech signals. Provides improvements to a
short term spectral amplitude filter to improve performance and
simplify real-time implementation.16
US 6,091,813 Issued July 18, 2000, entitled "Acoustic Echo Canceller". A
method and apparatus for cancelling acoustic echoes that enhances the
hands free operation of audio/video conferencing equipment, wireless
and cellular telephones, internet and intranet telephones, etc. The
method and apparatus include a novel method for updating the
coefficients of an adaptive filter.17
US 6,108,610 Issued August 22, 2000, entitled "A Method and System for
Updating Noise Estimates During Pauses In An Information Signal". A
method and system for improving Adaptive Speech Filter estimates of
the noise component of complex signals that contain both the
information signal and noise. Noise estimates are generated and
updated only during pauses in the information signal, thus increasing
processing speed and decreasing system memory.18
Disclosures for Which Patent Applications are to be Filed
631 Adaptive Speech Filter with Constant Output Noise Level
643 A Method of Applying Noise Reduction and Acoustic Echo Cancellation to
Audio
650 Fast Detection of the end of the Utterances Using the Sum of
Parameters of Speech Signal
667 Method and Apparatus for Removing or Reducing Interfering Signals from
a Desired Signal
668 Method and Apparatus for Removing or Reducing Interfering Signals from
a Desired Signal where there are several interfering sources
1 Issued in Canada
2 Issued in Australia, Canada, Korea, Europe (Austria, Belgium, France,
Germany, Italy, Netherlands, Sweden, Switzerland, UK) Pending in Japan
3 Pending in Canada, Europe and Japan
4 Pending in Canada, Europe and Japan
5 Issued in Canada, Europe (France, Italy, Germany, Sweden, UK)
6 Issued in Australia, Canada, Europe (France, Germany, Italy, Netherlands,
Sweden, UK) Pending in Japan
7 Issued in Australia, Austria, France, Germany, Netherlands, Norway, S.
Africa, Sweden, Switzerland
8 Pending in Europe
9 Issued in Canada, pending in Korea
10 Pending in Europe, Canada, Japan
11 Issued in Canada, Europe (Austria, Belgium, Denmark, France, Germany,
Italy, Netherlands, Switzerland/Lichtenstein, UK)
12 Issued in Canada, Europe (Austria, Belgium, Switzerland, Germany, Denmark,
France, Italy, Netherlands, Sweden, UK)
13 Granted in Europe (France, Germany, Italy, Sweden, UK) Pending in US, Japan
14 Pending in Malaysia, Taiwan, Canada, Europe
15 Issued in UK and Japan
16 Pending in Canada, Europe, Japan and Hong Kong
17 Pending PCT filing
18 Pending PCT filing
<PAGE>
Schedule C
Licensed Technology
1. The unpatented technology contained in the patent applications filed or to
be filed and listed on Schedule B hereto.
2. The unpatented technology in NCT Hearing's possession which NCT Hearing is
free to disclose and which supports, amplifies, explains or enables the
design or manufacture of products embodying any of the claims of the
Licensed Patents.
3. The unpatented technology contained in the Deliverables listed on Schedule
A hereto.
<PAGE>
Schedule D
Form of NCT Hearing Source Code Delivery Agreement
SOURCE CODE DELIVERY AGREEMENT
This Agreement, made and entered into this _____ day of _______, 2000 by
and between NCT Hearing Products, Inc., a Delaware corporation, having a place
of business at 20 Ketchum Street, Westport, Connecticut 06880 ("NCT Hearing")
and _____________________________, a __________ corporation, having offices at
__________________________________ ("Recipient").
WHEREAS, NCT Hearing and Recipient entered into a License Agreement dated
August __, 2000 under which Recipient and NCT Hearing agreed to collaborate in
the design and development of certain headset products incorporating NCT Hearing
technology under certain of NCT Hearing's patented and unpatented technology to
make, use and sell such headset products; and
WHEREAS, in connection with the foregoing, NCT Hearing will provide
Recipient with access to certain NCT Hearing source codes; and
WHEREAS, Recipient agrees to hold and use such source codes in accordance
with this Agreement and the License Agreement.
NOW THEREFORE, in consideration of the mutual promises and covenants set
forth herein, NCT Hearing and Recipient agree as follows:
1. Definitions. As used herein, the definitions set forth above and
hereinafter in this Section 1 shall apply:
(a) "Licensed Software" shall mean the software implementation of: NCT
Hearing's _____________ version of its ________________ algorithm in object code
form executable on _______________________________, all constituting part of the
NCT Hearing technology licensed to Recipient by NCT Hearing under the License
Agreement.
(b) "Source Codes" shall mean the ___ (_) source codes for the Licensed
Software in disc and hard copy formats, and all related documentation, including
but not limited to flow charts, explanatory notes and other documentation used
with such source codes.
(c) "Licensed Products" shall mean Licensed Products as defined under the
License Agreement.
2. Delivery of the Source Codes. Within __________ (____) business days of
the date hereof, NCT Hearing shall deliver the Source Codes to Recipient and
Recipient shall hold and use the Source Codes during the term of this Agreement
in accordance with the further provisions hereof.
3. Use of the Source Codes. Recipient's use of the Source Codes shall be
limited to implementation by Recipient of the Licensed Software for Licensed
Products or as otherwise permitted under the License Agreement or required or
needed by Recipient to exercise its rights under the License Agreement.
4. Obligations of Recipient. In consideration of NCT Hearing's delivery and
disclosure of the Source Codes to Recipient, Recipient agrees to undertake the
following obligations with respect thereto:
(a) to consider the Source Codes as Confidential Information under Article
5 of the License Agreement;
(b) to use the Source Codes only as permitted under this Agreement and the
License Agreement and in no other manner whatsoever;
(c) to not copy, in whole or in part, the Source Codes except as otherwise
required or needed for Recipient to exercise its rights under the License
Agreement or as otherwise permitted under the License Agreement; and
(d) to return to NCT Hearing the Source Codes and all copies thereof
together with any changes made to the Source Codes by Recipient and to erase all
portions thereof from memory upon the termination of this Agreement or the
termination of the License Agreement, whichever first occurs.
5. Reservation of Rights. Except and only to the extent expressly provided
herein relating to the internal use of the Source Codes by Recipient and to the
extent of any rights granted to Recipient under any other agreement, such as
this License Agreement, no other rights or licenses, express or implied, are
hereby granted to Recipient.
6. Term and Termination. The term of this Agreement shall commence on the
date hereof and shall continue until the termination of the License Agreement in
accordance with the provisions of Article 9 of the License Agreement. In
addition, either party may terminate this Agreement in the event of a material
breach of this Agreement by the other party in accordance with the provisions of
Section 9 of the License Agreement.
7. Survival. The restrictions and obligation of Recipient set forth in
Section 4 of this Agreement shall survive any expiration, termination or
cancellation of this Agreement and shall continue to bind Recipient, its
successors and assigns.
8. Notices. All notices under this Agreement shall be given in the manner
provided by Article 19 of the License Agreement.
9. Rights of Assignment; Successors and Assigns. Any rights of assignment
of this Agreement shall be governed by Article 16 of the License Agreement.
10. Governing Law; Remedies. This Agreement shall be construed and enforced
in accordance with the laws of the State of Delaware. Recipient acknowledges
that the confidential and proprietary status of the Source Code is of a unique
nature, the loss of which may cause irreparable harm to NCT Hearing for which
any sum of money would be inadequate, and that it may be impossible to measure
in money the damages which would be suffered by NCT Hearing by reason of the
loss of such confidential and proprietary status. Accordingly, in the event of
any material breach or threatened material breach by Recipient of any of its
obligations related to maintaining the confidentiality of the Source Codes under
this Agreement, NCT Hearing shall be entitled, as a matter of right, to a final
order from a court of competent jurisdiction of injunctive and other equitable
relief and if NCT Hearing shall institute any action or proceeding to enforce by
specific performance or other equitable relief the provisions hereof, Recipient
hereby waives the claim or defense that NCT Hearing has an adequate remedy at
law and Recipient shall not urge in any such action or proceeding the claim or
defense that such remedy at law exists provided, however, that nothing herein
contained shall limit or constrain the respective rights of either of the
parties hereto to pursue and recover damages at law for breaches of this
Agreement.
11. Entire Agreement; Amendment. This Agreement and the governing License
Agreement, contain the entire understanding between the parties concerning the
subject matter hereof. No change, modification, alteration or addition to any
provision hereof shall be binding unless in writing and signed by an authorized
officer of each of the parties.
In witness whereof, the parties hereto have executed and delivered this
Agreement with legal and binding effect as of the date first written.
NCT HEARING PRODUCTS, INC.
By:
-------------------------
Pro Tech Communications, Inc.
By: -------------------------
