Impact Research Corporation, Joan C. Benz, Tax Matters Person - Page 15




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               hereinafter defined in Section 5) accrued as of the                    
               Date of Termination shall remain due and payable                       
               notwithstanding termination.                                           
                                                                                     
                           (b)  Subject to the provisions of paragraph                
               (c) of this Section 2.04, the Exclusive License shall                  
               terminate as to the Demonstration Discs upon the                       
               occurrence of any of the following events: (i) * * *                   
               [Systems] or an assignee pursuant to the terms hereof                  
               is adjudicated a bankrupt and ceases operations; (ii)                  
               there shall be a failure to make a Royalty Payment in                  
               accordance with Section 5 hereof for a period of at                    
               least twenty (20) days after the date on which the same                
               is due and payable; (iii) * * * [Systems] fails to                     
               complete the Funded Research Effort (as defined in the                 
               R&D Agreement) within one (1) year from the date                       
               hereof; (iv) * * * [Systems] fails to complete the                     
               development of and to offer for sale to the public at                  
               least five (5) of the courses to be included in the                    
               Core Concepts in Science and Mathematics series on or                  
               before January 1, 1987; or (v) * * * [Systems] fails to                
               develop and maintain in good faith policies and a                      
               program to protect the confidentiality of the                          
               Demonstration Discs and the technology relating                        
               thereto, pursuant to section 8 hereof.                                 
                           (c)  If the Exclusive License has not                      
               terminated pursuant to the preceding provisions of this                
               Section 2.04, it shall terminate on March 31, 1994 (the                
               “Date of Termination”).                                                
               Systems did not remit to either IRC or RIC any royalties in            
          1984.                                                                       
               3.  Option Agreement                                                   
               On or about March 19, 1984, IRC and Systems entered into an            
          agreement under which Systems had the option to buy IRC’s assets            
          in exchange for Systems’ stock, but only if all of certain                  
          specified conditions were met.  One of these specified conditions           
          was that Systems’ notice of election to exercise the option                 
          “shall provide for the consummation of the sale of the assets of            





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