ADDENDUM NO.3 TO THE COOPERATION AGREEMENT BETWEEN IXI MOBILE (R&D) LTD. AND [*] DATED [*]

*	CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.

 

This Addendum No.3 to the Cooperation Agreement of [*] (this "Addendum") is made and entered into as of [*] (the "Effective Date"), by and between IXI Mobile (R&D) Ltd., an Israeli company (the “Company”) and [*], a [*] company ("Distributor").

WHEREAS, the Company is, amongst other activities, in the business of developing, manufacturing and selling certain mobile devices, currently known as OGO™ with embedded software applications and related services (collectively, the "OGO Device");

WHEREAS, the parties have previously entered into that certain Cooperation Agreement dated [*] (the "Distribution Agreement") pursuant to which the Company granted the Distributor rights, and the Distributor has undertaken, to distribute and sell the OGO Device to its customers (each an "End User" and collectively, "End Users") pursuant to the terms and conditions of the Distribution Agreement;

WHEREAS, in addition to the features already offered by the Company to End Users for use with the OGO Device, the Distributor now wishes to afford End Users the new feature of using [*] instant messaging services on the OGO Device;

WHEREAS, the Company has entered into that certain [*] Agreement (the "[*] Agreement") with [*], a Delaware corporation ("[*]"), pursuant to which, among other things, [*] granted the Company certain license rights to the [*] brand instant messaging service and [*] trademarks, some of such license rights may be sublicensed by the Company to the Distributor subject to certain restrictions and limitations as set forth in the [*] Agreement;

WHEREAS, the Company wishes to grant the Distributor, and the Distributor is willing to accept, a sublicense to the [*] brand instant messaging service and certain [*] trademarks subject to the restrictions and limitations set forth in the [*] Agreement;

NOW, THEREFORE, in consideration of the mutual promises and covenants in this Addendum, the parties hereto hereby agree as follows:

1.	Definitions.

In this Addendum, the following terms shall have the following meanings:

1.1. "Distribution Agreement" means as such term is defined in the Recitals to this Addendum.

1.2. "End User" or "End Users" mean as such terms are defined in the Recitals to this Addendum.

1.3. "[*]" means as such term is defined in the Recitals to this Addendum.

1.4. "[*] Agreement" means as such term is defined in the Recitals to this Addendum

 

 

1.5. “[*] Branding Elements” means the [*] proprietary trademarks, service marks, logos, trade names, product names, graphic look-and-feel elements, audio and video files, and other indicia of [*] origin or ownership required by [*] used by the Company in connection with the [*] Messaging Application pursuant to the [*] Agreement.

1.6. "[*] Client" Shall mean the client software, device or functionality (e.g. browser technology) developed and distributed by [*] or an Affiliate of [*] that enables end users to access and use the [*] Service.

1.7. “[*] Consumer Marks” shall mean the particular trademark(s) identified in Exhibit A attached hereto as an [*] Consumer Mark.

1.8. "[*] Messaging Application" means the particular version of the software application developed by the Company pursuant to the [*] Agreement that provides an End User access to the [*] Services and which has been approved by [*] for distribution as part of the OGO Device.

1.9. "[*] Service” means the [*] brand instant messaging service, including the [*] 2-Way SMS Service, and any other products or services owned, operated, distributed or authorized to be distributed by or through [*], as designated by [*] from time to time and communicated by the Company to the Distributor.

1.10. "[*] User Data" means as such term is defined in Section 4.6 below.

1.11. “IXI Server” means the combination of hardware and software that communicates between [*]'s network and the Company's network and that is required to enable access to the [*] Services by the OGO Device through the [*] Messaging Application.

1.12. "OGO Device" means as such term is defined in the Recitals to this Addendum.

1.13. "Term" means as such term is defined in Section 13.1 of this Addendum.

1.14. "Territory" means [*].

2.	License Grant.

Subject to the terms and conditions of this Addendum and the terms and conditions of the Distribution Agreement, the Company hereby grants Distributor a non-exclusive, limited, non-transferable, non-sublicensable license to distribute the [*] Services to End Users solely on OGO Devices and solely through the [*] Messaging Application over a GPRS or any upgraded internet access wireless protocol approved in writing by [*], using such End Users' existing [*] numbers and passwords or by registering for the [*] Services through [*]’s standard registration process.

3.	License Restrictions and Limitations.

In addition to any restrictions and limitations set forth in the Distribution Agreement which shall apply, mutatis mutandis, to the rights granted to Distributor pursuant to this Addendum, Distributor's rights pursuant to this Addendum, shall be subject to the following restrictions, limitations and Distributor's undertakings and acknowledgements:

 

 

 

3.2. Distributor acknowledges and agrees to fully cooperate with the Company and [*] and take all reasonable actions to ensure that access to and use of the [*] Services by End Users is governed by [*]’s then current Member Agreement for the [*] Services. Distributor further acknowledges and agrees that it is expressly prohibited from accessing, and from providing any third party (including End Users) access to, the [*] services, or any other [*] affiliate service. Distributor acknowledges and agrees that (x) it shall make available to End Users all features and functionality of the [*] Services that the Company makes available to the End Users, subject to technical limitations of the [*] Messaging Application; and (y) it is expressly prohibited from connecting directly to the [*] network.

3.3. Notwithstanding any other provision of this Addendum, (i) Distributor will not attempt to access or use the [*] Service, or authorize or facilitate access or use thereof by any third parties (including End Users), by means of any application or device other than the OGO  Device; and (ii) Distributor shall not represent that any connection or access or use of the [*] Service is for a perpetual term and shall ensure that any End User is aware that [*] may deny such access at any time and for any reason, and in any case shall not be for a term longer than the Term.

3.4. Distributor acknowledges and agrees that the Company, and not [*], is responsible for developing the [*] Messaging Application, as well as operating and supporting the IXI Server.

3.5. Distributor acknowledges and agrees that [*] is not obligated to provide any technical support to any third party with respect to the [*] Service and the [*] Messaging Application.

3.6. Distributor acknowledges and agrees that [*] shall be free to prohibit or terminate access to the [*] Service at any time in its sole discretion.

4.	Proprietary Rights; [*] User Data.

4.1. As between the Company and Distributor, the Company, or its licensors, will own all intellectual property rights or similar rights, title and interest in the [*] Messaging Application as well as any and all intellectual property rights or similar rights in the OGO Device and any other service provided as part of the OGO Device which is not the [*] Service (e.g. e-mail, email attachments, synchronization etc.). Except as expressly permitted in this Addendum, no right or license is granted, under any of the Company's intellectual property rights, in or to the OGO Device or the [*] Messaging Application.

4.2. Subject to the limited licenses expressly granted herein, as between the parties, [*] shall own and hold all right, title and interest in and to all the [*] Consumer Marks and the [*] Service and all intellectual property rights or similar rights associated with, embodied in, or practiced by the foregoing.

4.3. The Company reserves all rights not expressly granted in this Addendum. For sake of clarity, except as explicitly permitted in this Addendum, no right or license is granted, under any of [*]’s intellectual property rights.

4.4. The parties existing confidentiality obligations pursuant to the Distribution Agreement or any other non-disclosure agreement or other agreement of similar effect, shall apply to any non-public information provided by either party to the other party under this Addendum and to the [*] User Data. 

 

 

4.5. Except for the usage rights with respect to the [*] Consumer Marks, which usage rights shall be subject to the terms, conditions and limitation set forth in Section 6 of this Addendum, no right, title, or interest is being granted to the Distributor herein in or to any [*] Branding Elements or [*] Consumer Marks and as between the Company, Distributor and [*], [*] shall remain the sole and exclusive owner of the [*] Branding Elements and the [*] Consumer Marks.

4.6. As between the Company and the Distributor, any and all information collected or otherwise obtained from End Users by either the Company or the Distributor in connection with such End User’s use of, navigation through, and/or registration for the [*] Service, including, but not limited to, user names, passwords, [*] numbers, email addresses, domain names (including vanity domain names), credit card information where [*] is the merchant of record, user preferences or history or other identifying information, shall be owned and controlled by [*] (“[*] User Data”). Nothing in this Addendum shall be read to give the Distributor or any third party a license or any other right in or to the [*] User Data, both during and after the Term of this Addendum.

4.7. At all times either during or after the Term of this Addendum, Distributor shall not use or disclose any [*] User Data to any third-party in any manner or for any purpose without the prior written consent of [*].

5.	Service Level.

Distributor acknowledges and agrees that the service level with respect to the [*] Service offered by the Company shall be pursuant to a service level agreement between [*] and the Company.

6.	License in [*] Consumer Marks.

6.1. Subject to the terms and conditions of this Addendum, the Company hereby grants to Distributor, a limited, non-exclusive, non-transferable, non-sublicensable, royalty-free license during the Term to use, display and reproduce the [*] Consumer Marks solely on OGO Devices and packaging, package inserts, advertising and marketing materials for the OGO Devices directed towards End Users, and solely in accordance with the Usage Standards set forth in this Section 6 and such other [*] trademark usage guidelines as the Company may from time-to-time provide to Distributor.

6.2. Distributor acknowledges and agrees that its use of the [*] Consumer Marks pursuant to Section 6.1 above must be approved by the Company in writing prior to use. The Company shall request [*]'s approval of such use prior to and as a condition to its approval. Distributor further acknowledges and agrees that all use of the [*] Consumer Marks shall, at all times, remain subject to such [*] written trademark usage guidelines as the Company may from time-to-time provide to Distributor. Distributor acknowledges and agrees that the Company has no control over [*] and that there is no guaranty that [*] will grant its permission to any use of Distributor of the [*] Consumer Marks, although Distributor's strict compliance with the terms of this Section 6 will most likely increase the possibility of any such use being approved by [*]. Distributor acknowledges the exclusive ownership right of [*] in the [*] Consumer Marks and agrees that all use of the [*] Consumer Marks shall inure to the benefit, and be on behalf, of [*]. Without limiting the foregoing, Distributor will not (i) use the [*] Consumer Marks in any manner that disparages or tarnishes any [*] Consumer Marks or the reputation of [*], or that could reasonably be expected to do so; (ii) modify the [*] Consumer Marks; (iii) combine in one mark the [*] Consumer Marks with any other marks or create any composite marks; (iv) register or attempt to register the [*] Consumer Marks in any jurisdiction or create, use, register or attempt to register any confusingly similar mark; or (v) challenge [*]'s proprietary rights in and to the [*] Consumer Marks, or undertake any action which impairs such proprietary rights of [*] or its licensors, or that could reasonably be expected to do so. Distributor shall, throughout the Term and for a period of not less than one (1) year after the termination or expiration of this Addendum, retain representative copies of all uses of the [*] Consumer Marks, and shall provide such copies to either [*] or the Company upon [*]'s or the Company's request at any time prior to the date which is one (1) year after such termination or expiration.

 

 

6.3. Upon notice from [*] or the Company of [*]'s objection to any improper or incorrect use by Distributor of the [*] Consumer Marks, Distributor shall immediately correct or change such usage. Distributor agrees to promptly notify the Company of any unauthorized use of the [*] Consumer Marks of which it has actual knowledge and agrees that [*] shall have the sole right and discretion to bring proceedings alleging infringement of the [*] Consumer Marks or unfair competition related thereto; provided, however, that Distributor shall provide [*] and/or the Company with its reasonable cooperation and assistance with respect to any such infringement proceedings as long as Distributor does not have to bare any financial expense as a result of such assistance.

7. Commercial Terms.

7.1. Distributor shall pay the Company such fees related to access to the [*] Services as detailed in Exhibit B of this Addendum.

7.2. Distributor agrees that any fees charged by it to End Users for use of the [*] Services via [*] Messaging Application shall [*] than any fees that Distributor charges its subscribers for any application that it provides to its subscribers that provide instant messaging services that are similar to, and have functionality comparable with, the [*] Services on the [*] Messaging Application, including, but not limited to, Internal community, [*] and [*].

8. Links to [*] Messaging Application and Service.

The Company requests that Distributor provides links to the [*] Messaging Application and/or the [*] Service among the top [*] links in the same categories (e.g., new releases, instant messaging, etc.) where the Distributor provides links to similar applications and/or services.

9. Reporting.

At the request of the Company, Distributor agrees to provide to the Company with a written report, not less frequently than [*], which report shall at a [*], (i) identify the projected volumes of [*] Messaging Applications and OGO Devices, if any, to be distributed during the forthcoming [*] period; (ii) the projected fees payable to the Company from the distribution of such projected volumes of [*] Messaging Applications and OGO Devices; (iii) the Distributor’s marketing and promotion plans related to the [*] Services, including, the Approved Distributor’s marketing and promotion budget and an indication if the Company is authorized to disclose such marketing and promotion budget to [*], and (iv) the End User pricing implemented by the Distributor in relation to an [*] Client and access to the [*] Service; [*] (viii) any other information reasonably requested by the Company and mutually agreed to by the parties.

 

 

10. Disclaimer of Warranties.

IN ADDITION TO, AND WITHOUT LIMITING THE GENERALITY OF, ANY DISCLAIMERS OF WARRANTIES UNDER THE DISTRIBUTION AGREEMENT, THE COMPANY HEREBY DISCLAIMS ANY AND ALL REPRESENTATIONS OR WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, REGARDING ANY AND ALL [*] SERVICES, OR ANY OTHER SERVICES, INFORMATION OR MATERIALS PROVIDED OR MADE AVAILABLE BY [*], INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, SYSTEM INTEGRATION, DATA ACCURACY, TITLE AND NON-INFRINGEMENT.

11. Limitation of Liabilities.

ANY EXCLUSION OF REMEDIES PROVISIONS AND LIMITATION OF LIABILITIES PROVISIONS SET FORTH IN THE DISTRIBUTION AGREEMENT SHALL APPLY TO THE TRANSACTIONS CONTEMPLATED BY THIS ADDENDUM, EXCEPT WITH RESPECT TO BREACHES OF SECTIONS 3 (LICENSE RESTRICTIONS), 4 (PROPRIETARY RIGHTS AND [*] USER DATA), 6.2 AND 6.3 ([*] CONSUMER MARKS USAGE) AND 12 (INDEMNIFICATION) HEREUNDER.

12. Indemnification.

Distributor shall indemnify, hold harmless and defend the Company from and against all losses, expenses (including reasonable attorneys’ fees), damages, and liabilities resulting from any claim by any third party against the Company and/or from any claim by any third party against [*], [*] and its affiliates for which the Company is required to provide indemnification and arising from or in connection with any act or omission by of the Distributor.

13. Term.

13.1. The term of this Addendum ("Term") shall commence on the Effective Date and shall end on the date [*] from the Effective Date.

13.2. The provisions of Sections 3, 4, 10, 11, 12 and 14 shall survive the expiration or termination of this Addendum.

14. General Terms and Conditions.

14.1. The parties acknowledge that they continue to be bound by the terms of the Distribution Agreement, as amended and/or supplemented hereby. Except as amended and/or supplemented hereby, all of the terms of the Distribution Agreement shall remain and continue in full force and effect and are hereby confirmed in all respects. Accordingly, each of the parties acknowledges and agrees that the [*] Messaging Application and the [*] Services shall be governed by the terms of the Distribution Agreement; provided, however, that in the event of any discrepancies between the terms and provision of the Distribution Agreement and the terms and provisions of this Addendum, the terms and provisions of this Addendum shall govern and prevail.

14.2. This Addendum may be executed in counterparts, each of which shall constitute an original, but all of which together shall constitute one and the same Addendum. Originally executed counterparts may be delivered by facsimile and any such delivery shall be valid for all purposes as delivery of a manual signature and equally admissible in any legal proceedings to which any of the parties is a party.

 

 

14.3. If any provision of this Addendum or the application thereof, shall for any reason and to any extent be determined by a court of competent jurisdiction to be invalid or unenforceable under applicable law, the remaining provisions of this Addendum shall be interpreted so as best to reasonably effect the intent of the parties hereto.

14.4. This Addendum, together with the Distribution Agreement and all exhibits hereto and thereto, constitute the entire understanding and agreement of the parties with respect to the transactions contemplated herein and supersede all prior and contemporaneous understandings and agreements, whether written or oral, with respect to such transactions.

14.5. This Addendum shall be governed in all respects by the governing law and choice of forum sections of the Distribution Agreement.

 

 

IN WITNESS WHEREOF, the parties have caused their duly authorized representatives to execute this Addendum as of the Effective Date.