Multimedia Filter and Codec A COmpressor combined with a DECompressor, or encoder and a decoder, which allows you to both compress and decompress that same data. Agreement

LEADTOOLS MULTIMEDIA

Duplication and Distribution Agreement

For Codecs/Direct Show Filters

(Per Copy Agreement)

Filter(s)/Codecs to be included with Application Software: See completed schedule 1 (herein Licensed Filters).

This Duplication and Distribution License (Agreement) is made by and between LEAD Technologies, Inc., a North Carolina corporation, principally located at 1201 Greenwood Cliff, Suite 400, Charlotte, North Carolina 28204, USA (LEAD) and Licensee.  

Recitals

1. Licensee has heretofore obtained a development license to use the Software in connection with the development of the Application Software in accordance with the terms of the LEADTOOLS Software License Agreement, a copy of which is included in the Software packaging and online help file, and the terms of which are hereby incorporated herein by this reference (herein the License Agreement).

2. The Software includes demo versions of several optional components comprising Direct Show filters and audio and video codecs, including demo versions of the Licensed Components, which are bundled with the Software and which may be licensed for inclusion with the Application Software.

3. Licensee wishes to obtain a license whereby it may internally deploy or commercially distribute the Application Software with the Licensed Components to end users and LEAD is willing to grant the licenses described herein provided Licensee complies with the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and promises set forth herein, the parties hereto, intending to be legally bound, do hereby agree as follows:

1. Effectiveness of License Agreement; Grant of Duplication and Distribution License. 
   (a) License Agreement. Licensee acknowledges that its use of the Software and Licensed Components is governed by the terms, conditions, limitations and restrictions contained in the License Agreement and hereby agrees to faithfully abide by such terms and conditions and will not take any action with respect to the Software or Licensed Components prohibited by the License Agreement.  This Agreement is supplementary to the License Agreement, and this Agreement and the License Agreement together will govern Licensees use of the Software, Licensed Components and Application Software.  Unless otherwise modified by the terms of this Agreement, all of the terms and conditions of the License Agreement remain in full force and effect.  In the event of an inconsistency between this Agreement and the License Agreement, this Agreement will control.
   
   (b) Duplication and Distribution License.  Under LEADs copyright, and subject to all the terms and conditions set forth in this Agreement and the License Agreement, including without limitation, the payment of the runtime licensing fees described in paragraph 2 hereof, LEAD hereby grants Licensee (and only Licensee) a non-exclusive, non-transferable, worldwide license to reproduce exact copies of the Licensed Components and include such files in the Application Software, and to deploy the Application Software on Licensees owned and controlled computers and networks for use by Licensees employees, contractors and affiliates and/or to commercially distribute the Application Software, directly or through customary distribution channels, to end users for their use without further distribution.  

2. Runtime Licenses.  Licensee must purchase a runtime license or server license for each Deployment of Application Software.  For purposes hereof, a Deployment of Application Software will include Stand Alone Deployments, Concurrent Deployments and Server Licenses.  A Stand Alone Deployment includes any and all copies of the Application Software installed, used, distributed, leased, or sold by Licensee and any of its customers, employees, distributors, resellers, affiliates or other channel partners.  If the Application Software is installed on a server or network by Licensee or its customers, the number of Stand Alone Deployments that must be reported and the number of runtime licenses that must be purchased hereunder will be the number of computers that are permitted access to the Application Software via the network or server, unless a Server License is purchased (section 2(c) below).  
   
   (a) Per Copy Runtime Licensing for Runtime Licenses that are Not Prepaid.  Except as otherwise provided in paragraph 2(b) 2(c) or 2(d) hereof, Licensee will pay a runtime license fee equal to the non prepaid runtime license fees set forth on Schedule 2 for the Licensed Components times the number of Deployments of Application Software.  Licensee will report Deployments and pay for the runtime licenses pursuant to paragraph 3 hereof.
   
   (b) Prepaid Runtime Licensing.  In lieu of paying the per copy non-prepaid rates as described above, Licensee may pay in advance for its projected runtime licensing needs in the quantities and for the prices set forth on Schedule 2, attached hereto. In order to receive the prepaid runtime pricing contained on schedule 2, Licensee must prepay for its runtime licenses at the prices set forth on schedule 2 prior to Deployment of the Application Software.  To select a prepaid Deployment option, Licensee shall send LEAD a purchase order for Licensed Filter runtime licenses covering the desired number of copies of the Application Software before making the Deployments covered by the purchase order, and LEAD will generate an invoice covering the prepaid copies.  During the term hereof, Licensee may, from time to time, issue multiple purchase orders for multiple quantity orders.
   
   (c) Server Licenses.  In lieu of purchasing runtime licenses, Licensee has the option of purchasing Server Licenses in certain circumstances.  If the Application Software will be installed  and executed solely at the server level (no Software is distributed to client machines, such as a control distributed in a CAB file or .DLL distributed to a client machine for .NET web deployment), Licensee will have the option of purchasing a Server License for each server the Application Software is installed upon, and by purchasing a Server License, no additional runtime licensing will be required for the computers that are connected to the server. (Servers with more than 2 CPUs will require a Server License for each additional CPU or pair of CPUs.)  If the number of connected computers does not justify  purchasing a Server License, Licensee has the option of selecting licensing based on sections 2(b) and (c) above.  For example, if Licensee installs the Application Software on a server and only ten (10) computers are connected to the server, Licensee may purchase ten (10) Stand Alone runtime licenses and will not be required to purchase a Server License.  On the other hand, if the Application Software is installed on a server that is connected to one thousand (1000) computers and Licensee purchases a Server License, Licensee will not be required to purchase runtime licenses for the 1000 computers that are connected to the server.  Server Licenses may be purchased at the prices set forth below.

3. Reporting and Payment.  Licensee agrees to maintain full, clear and accurate records as to all Deployments of the Application Software.  Licensee will submit to LEAD, within thirty (30) days of the close of each calendar quarter, a report setting forth the number of Deployments of Application Software made during such quarter, and accompanying such report will be a check in the amount of runtime licensing that is due, if any.  If no Deployments have been made during said quarter, Licensee will provide a certification so stating.  Licensee shall keep adequate records to accurately determine the payments due under this Agreement.  LEAD shall have the right, no more than once during any calendar year, to have an independent certified public accountant or other disinterested third party inspect the relevant records of Licensee on thirty (30) business days notice and during regular business hours to verify the reports and payments required to be made hereunder.  Should an underpayment in excess of five percent (5%) be discovered, Licensee shall pay the cost of the audit.  If Licensee is more than thirty (30) days late with any payment of amount due hereunder, interest will accrue from the date due until paid at the lesser of (i) 1.5% per month or (ii) the maximum rate of interest permitted by law.  All amounts due hereunder are based on United States currency.

4. New Versions; Upgrades.  Minor version updates to the Software (e. g. LEADTOOLS version 15.1, 15.2 etc.) are provided to Licensee free of charge via LEADs web site.  Licensee may license major new versions of the Software (e. g. LEADTOOLS version 16, 17 etc.) by purchasing a development license to the new version at LEADs then prevailing upgrade price.  No additional runtime licensing is required for updates and upgrades to the Application Software distributed to users of the Application Software for which runtime licenses have been paid and accounted for hereunder unless a major new version of the Software is included in the upgrade.  If a major new version of the Software is included in an upgrade to the Application Software, each user that is upgraded will be considered to be a new Deployment for purposes of runtime license payment and reporting hereunder.  Any prepaid runtime licenses that have not been deployed at the time Licensee takes a license to a major new version of the Software will be carried forward and may be applied to Deployments of Application Software made with the major new version of the Software.  Licensee will be under no obligation to update previously deployed user or client licenses with the new version of the Application Software that includes the major new version of the Software.

5. Third Party Patents; Rights of Content Owners.  Certain technologies such as MPEG 2, MPEG 4 and H.264 are subject to third party patents, including patents managed by MPEG LA and Via Licensing.  LEAD has obtained a patent license from MPEG LA and Via Licensing which covers LEAD’s distribution of its products. LEAD’s license does not extend to Licensee’s products.  Licensee is responsible for obtaining any and all third party patent licenses for the deployment and distribution of the Application Software, including any licenses required by MPEG LA and Via Licensing, and will indemnify and hold LEAD harmless from any and all patent claims asserted against LEAD which arise by virtue of Licensee’s distribution or deployment of the Application Software.   Additionally, Licensee agrees that it will not use the Software or Application Software for any unlawful purpose, including without limitation, for copying, distributing, broadcasting or publishing the copyrighted works of any third party without a proper license, and Licensee will indemnify and hold LEAD harmless from any and all claims asserted against LEAD as the result of any wrongful actions taken by Licensee.

LEAD and Licensee have caused this Agreement to be executed in their names by the following authorized representatives.

Schedule 1

List of Licensed Filters

to be included with Application Software

Direct Show Filters:

Codecs:

Schedule 2

Licensed Component Runtime Pricing

Option 1 - Per Copy Pricing Model

The basic licensing model requires that a runtime license be purchased for each “Deployment” of the Application Software.  A “Deployment” of Application Software includes: (i) each copy of the Application Software installed by customer for internal use and (ii) each copy of the Application Software distributed to third parties by customer and its resellers/distributors.  If the Application Software is installed on a network or server by customer or any of customer’s licensees, a runtime license is required for each computer that is connected to the network or server having access to the Application Software.  Customers have the option of purchasing runtime licenses on a nonprepaid “trailing” basis or may purchase runtime licenses in prepaid quantity blocks at a substantial discount:

Option 2 – Server License – Third Party Client Software

For customers developing Application Software to be installed on a server that will reside solely on the server but which may be accessed by multiple users who are using third party software (software that does not include any of the libraries included in the LEAD SDK), these customers will have the option of purchasing Server Licenses for each server the Application Software is installed upon and by purchasing a server license, no additional licensing will be required for the computers accessing the Application Software residing on the server.

Notes:

1. Application Software containing multiple filters and codecs will require a runtime license for each codec/filter included with the Application Software.

2. If Licensed Components includes more than one individual Direct Show Filter, a runtime license is required for each Direct Show Filter included with the Application. Software. For example, if each copy of the Application Software includes 3 individual Direct Show filters, then a distribution of 5 copies of the Application Software requires 15 runtime licenses for individual Direct Show filters.

3. Volume purchases are not cumulative.  If Licensee purchases 100 prepaid licenses at the applicable price and later purchases 50 prepaid licenses, the second purchase will be at the quantity 50 pricing level.