Fill and Sign the License Option and Collaboration Agreement Form

-1- § 7.16 Form: User Oriented Software License Agreement AGREEMENT made this ________ day of _____________ by and between Licensee, having its principal place of business in New York and Licensor, having its principal place of business in California. 1. Software License Licensor hereby grants to Licensee a perpetual, non-exclusive license to use the Software and Documentation (collectively, the "Software System"), subject to the terms and conditions hereinafter set forth. 2. License Fee As consideration for the perpetual license to use the Software System granted to Licensee herein, Licensee shall pay to Licensor the total sum of $_________, pursuant to the Payment Schedule set forth below. 3. The Software The Software shall consist of the modules or components, shall perform the functions and shall comply with the proposals and specifications, identified or set forth on Schedule A, annexed hereto. Each Software module or component, specification and proposal included or referred to in Schedule A is expressly incorporated by reference herein. 4. Documentation The Documentation shall consist of all operator and user manuals, training materials, guides, listings, specifications, and other materials for use in conjunction with the Software, as set forth in Schedule B, annexed hereto. Licensor shall deliver to Licensee, as specified below, five (5) complete copies of the Documentation set forth in Schedule B. Licensee shall have the right, as part of the license granted herein, to make as many additional copies of the Documentation for its own use as it may determine. 5. Source Code The Software shall include its Source Code form (the "Source Code"), and all relevant explanations and documentation of the Source Code (collectively, "Commentary"). Licensor is required to deliver to Licensee, as specified below, _____ copies of the complete Source Code contained on machine-readable media as well as _____ copies of a complete listing of the Source Code and Commentary. -2- 6. Operating Environment The Software, and each module or component and function thereof, shall be capable of operating fully and correctly on the combination of computer equipment ("Hardware") the programming language and the Operating System program specified in Schedule C, annexed hereto. 7. Delivery Within _____ days of the execution of this Agreement by Licensor, and upon no less than ten (10) days' prior notice to Licensee, Licensor shall deliver to Licensee's premises, located at _________________ (the "Site"), the required number of copies of the Software together with the required number of copies of the Documentation. Upon at least three (3) days' notice to Licensor, Licensee may postpone the delivery of the Software System to a mutually agreed-upon date no more than sixty (60) days thereafter. Licensor shall bear all freight, shipping and handling costs for such delivery of the Software System and all risk of loss, including any insurance costs. 8. Software Installation and Acceptance Promptly after delivery of the Software System to the Site, at a mutually agreed upon time and date, Licensor shall install the Software on the Hardware. Licensor shall successfully conduct all of its own testing procedures on the Software. Thereafter, upon reasonable advance notice to and in the presence of representatives of Licensee, Licensor shall conduct the acceptance testing procedure specified in Schedule F, annexed hereto, using a sample of data supplied by Licensee and converted and entered on the Hardware by Licensor at its sole cost. Upon successful completion of every element of the acceptance testing procedure set forth in Schedule F, Licensee shall execute a written notice of acceptance of the Software. In the event that the Software fails to pass any of Licensor's testing procedures or the acceptance test set forth in schedule F, then Licensor shall have fourteen (14) days in which to correct such defect and cause the Software to successfully pass all such tests, failing which Licensee may elect to cancel this Agreement and Licensor shall immediately refund all sums previously paid to it by Licensee hereunder. 9. Payment Schedule The License Fee for the license of the Software System granted herein shall be paid by Licensee to Licensor as follows: (a) Ten percent (10%), ($__________) upon execution of this Agreement; -3- (b) Seventy percent (70%), ($__________) upon complete delivery of all required copies of the Software and Documentation in conformity with this Agreement, and acceptance of the Software by Licensee as provided herein; and(c) The remaining twenty percent (20%), ($__________) within ninety (90) days after complete delivery of all required copies of the Software and Documentation in conformity with this Agreement, and acceptance of the Software by Licensee; provided, however, that such payment will not be due unless and until the Software is free from defects and otherwise in conformity with the specifications set forth in Schedule A. 10. New Location Licensee may, at any time, without prior notice to or consent of Licensor, transfer the Software to any location other than the site of initial installation for use on any other central processing unit ("CPU") which is owned or controlled by Licensee or by subsidiaries or other entities owned or controlled by Licensee. Licensee shall thereafter promptly give Licensor notice of such new location. 11. Multiple Use Option Licensee shall have the option to extend the license granted hereunder to include use of the Software on more than a single CPU which it may exercise in its sole discretion at any time by tendering to Licensor a payment equal to ______ percent (____%) of the License Fee specified above for the first additional site and a payment equal to ______ percent (___%) of the License Fee specified above for each additional CPU on which the Software shall be so used, together with a notice identifying such CPU and its location. 12. Training The License Fee includes all costs for the training of Licensee's employees on the use and operation of the Software on the Hardware, including instruction in any necessary conversion of Licensee's data for such use. Pursuant to a mutually agreed upon schedule, Licensor shall provide sufficient experienced and qualified personnel to conduct up to _____ full eight-hour days of such training of groups of up to _____ employees or other personnel of Licensee at a location or locations designated by Licensee. -4- 13. Licensor's Warranties Licensor hereby warrants and represents to Licensee as follows: (a) Ownership. Licensor is the owner of the Software System or otherwise has the right to grant to Licensee the license to use same set forth in this Agreement without violating any rights of any third party, and there is currently no actual or threatened suit by any such third party based on an alleged violation of such right by Licensor; (b) Business Requirements. Licensor is fully aware of Licensee's business requirements and intended uses for the Software and the Software shall satisfy such requirements and is fit for such intended uses; (c) Warranty Period. For a warranty period of one (1) year from the date of Licensee's acceptance of the Software, as specified above, the Software shall not contain any defects and shall function properly and in conformity with the description, specifications and Documentation set forth in Schedules A and B, and the Hardware specified in Schedule C. (d) Response Time. With respect to each on-line transaction, the Software, in conjunction with the Hardware, shall receive, process and respond in no greater than _____ seconds for ___% of the time, and in no instance greater than _____ seconds, from the time the transaction is completely keyed into a terminal until the appropriate Software response appears on the terminal; (e) Capacity. The Software, in conjunction with the Hardware, can maintain, use, update, and otherwise process, without adversely affecting its response time or other performance, a total of ___ records, ___ customers and ___ accounts. 14. Software Maintenance (a) During the warranty period, Licensor shall promptly notify Licensee of any defects or malfunctions in the Software or Documentation of which it learns from any source. Licensor shall promptly correct any defects or malfunctions in the Software or Documentation discovered during such warranty period and provide Licensee with corrected copies of same, without additional charge. Licensor's obligation hereunder shall not affect any other liability which it may have to Licensee. (b) Licensor shall provide to Licensee, without additional charge, copies of the Software System and Documentation revised to reflect any enhancements to the Software System made by Licensor during the warranty period. Such enhancements shall include all modifications to the Software System which increase the speed, -5- efficiency or ease of operation of the Software System, or add additional capabilities to or otherwise improve the functions of the Software System.15. Additional Support During the warranty period, Licensor shall provide to Licensee, without additional charge, all reasonably necessary telephone or written consultation requested by Licensee in connection with its use and operation of the Software System or any problems therewith. Telephone consultation shall be requested and provided only during Licensor's normal business hours and Licensee shall pay all long distance telephone charges in connection therewith. 16. Software Maintenance Contract and Renewal Option After expiration of the warranty period referred to above, Licensor shall provide maintenance, additional support and enhancements in connection with the Software System, pursuant to the one year Software Maintenance Contract executed concurrently herewith, a copy of which is annexed hereto. Licensor hereby grants to Licensee up to four (4) options to renew said contract, each for a period of one year, for a fee to be negotiated annually by Licensee and Licensor, but in no event exceeding the fee charged for the preceding year's contract by more than five (5) percent. 17. Licensee's Modifications Licensee shall have the right, in its own discretion, to independently modify the Software System for its own purposes and use, through the services of its own employees or of independent contractors, provided that same agree not to disclose or distribute any part of the Software System to any other person or entity or otherwise violate Licensor's proprietary rights therein. Licensee shall be the owner of any such modifications. Licensor shall not incorporate any such modifications into its software for distribution to third parties unless it first agrees to pay Licensee a reasonable royalty, pursuant to mutually agreed upon terms. 18. Confidentiality Each party agrees that it shall not disclose to any third party any information concerning the customers, trade secrets, methods, processes or procedures or any other confidential, financial or business information of the other party which it learns during the course of its performance of this Agreement, without the prior written -6- consent of such other party. This obligation shall survive the cancellation or other termination of this Agreement.19. Publicity Licensor shall not refer to the existence of this Agreement in any press release, advertising or materials distributed to prospective customers, without the prior written consent of Licensee. 20. Licensor's Proprietary Notices Licensee agrees that any copies of the Software or Documentation which it makes pursuant to this Agreement shall bear all copyright, trademark and other proprietary notices included therein by Licensor and, except as expressly authorized herein, Licensee shall not distribute same to any third party without Licensor's prior written consent. Notwithstanding the preceding sentence, Licensee may add its own copyright or other proprietary notice to any copy of the Software or Documentation which contains modifications to which Licensee has ownership rights pursuant to this Agreement. 21. Most Favored Customer Licensor agrees to treat Licensee as its most favored customer. Licensor represents that all of the prices, warranties, benefits and other terms being provided hereunder are equivalent to or better than the terms being offered by Licensor to its current customers. If, during the warranty period, Licensor enters into an agreement with any other customer providing such customer with more favorable terms, then this Agreement shall be deemed appropriately amended to provide such terms to Licensee. Licensor shall promptly provide Licensee with any refund or credits thereby created. 22. Assignment Licensee may assign this agreement to any subsidiary or affiliate under its control, or as part of the sale of that part of its business which includes the Hardware or any substantial portion of its data processing facilities, or pursuant to any merger, consolidation or other reorganization, without Licensor's consent, upon notice to Licensor. Licensor shall not assign this Agreement without Licensee's prior written consent, which shall not be unreasonably withheld. An assignee of either party, if authorized hereunder, shall have all of the rights and obligations of the assigning party set forth in this Agreement. -7- 23. Indemnity Licensor agrees to indemnify and hold harmless Licensee and its subsidiaries or affiliates under its control, and their directors, officers, employees and agents, against any and all losses, liabilities, judgments, awards and costs (including legal fees and expenses) arising out of or related to any claim that Licensee's use or possession of the Software or Documentation, or the license granted hereunder, infringes or violates the copyright, trade secret or other proprietary right of any third party. Licensor shall defend and settle at its sole expense all suits or proceedings arising out of the foregoing, provided that Licensee gives Licensor prompt notice of any such claim of which it learns. No settlement which prevents Licensee from continuing to use the Software System as provided herein shall be made without Licensee's prior written consent. In all events, Licensee shall have the right to participate in the defense of any such suit or proceeding through counsel of its own choosing. 24. Limited Liability Unless otherwise expressly stated herein, Licensor shall not be liable to Licensee for any consequential damages arising out of Licensor's breach of this Agreement. 25. Notice All notices required or permitted to be given by one party to the other under this Agreement shall be sufficient if sent by certified mail, return receipt requested, to the parties at the respective addresses set forth above or to such other address as the party to receive the notice has designated by notice to the other party. 26. Governing Law This Agreement shall be governed by and construed under the laws of the State of New York. 27. Consent to Jurisdiction, Venue and Service Licensor consents and agrees that all legal proceedings relating to the subject matter of this Agreement shall be maintained in courts sitting within the State of New York, and Licensor consents and agrees that jurisdiction and venue for such proceedings shall lie exclusively with such courts. Service of process in any such proceeding may be made by certified mail, return receipt requested, -8- directed to the respective party at the address at which it is to receive notice as provided herein.28. Severability If any provision of this Agreement is held invalid or otherwise unenforceable, the enforceability of the remaining provisions shall not be impaired thereby. 29. No Waiver The failure by any party to exercise any right provided for herein shall not be deemed a waiver of any right hereunder. 30. Complete Agreement This Agreement sets forth the entire understanding of the parties as to its subject matter and may not be modified except in a writing executed by both parties. IN WITNESS WHEREOF the parties have executed this agreement on the date first set forth above. LICENSEE: LICENSOR: By: ___________________ By: _____________________ President President