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Settlement Agreement - Convera Corp. and Intel Corp.

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                              SETTLEMENT AGREEMENT

         This SETTLEMENT AGREEMENT ("Agreement") is made as of December 23,
2003, (the "Effective Date") by and between Convera Corporation, including its
subsidiaries and affiliates ("Convera") and Intel Corporation, a Delaware
corporation ("Intel Corporation") (individually, each a "Party" and
collectively, the "Parties").

          WHEREAS,  Intel  incurred  certain  costs on  behalf  of  Convera  and
     believes that Convera otherwise owes to Intel an aggregate of approximately
     Four Million Dollars ($4,000,000.00) (the "Liability");

          WHEREAS, Intel has demanded that Convera pay the Liability;

          WHEREAS, Convera has disputed, in whole or part, its obligation to pay
     Intel in connection with the Liability; and

          WHEREAS,  the  Parties  desire to reach a  mutually  satisfactory  and
     legally binding settlement agreement with respect to the Liability.

          NOW,   THEREFORE,   in  consideration  of  the  mutual  covenants  and
     agreements contained herein and intending to be legally bound hereby, it is
     understood and agreed as follows:

     1.   Settlement  Payment.  Subject  to the  terms  and  conditions  of this
          Agreement,  Convera  shall pay Intel Three  Million Two Hundred  Fifty
          Thousand Dollars  ($3,250,000.00) (the "Settlement Amount") over a two
          (2) year period in equal  monthly  payments,  commencing as of January
          2004 and  terminating  November  2005  (i.e.,  24 monthly  payments of
          $135,416.67) (the "Repayment  Period") in full satisfaction of any and
          all  obligations  Convera  may have to Intel  which  arise from or are
          related to the Liability (the "Released  Claims"),  and Intel releases
          Convera from any and all  Released  Claims that Intel may have against
          Convera  other  than  Convera's   obligations  under  this  Agreement.
          Notwithstanding  the  foregoing,  if Convera's  "Cash  Liquidity"  (as
          defined  below)  does  not  equal at least  thirteen  million  dollars
          ($13,000,000.00) at the end of any of Convera's fiscal quarters during
          the Repayment  Period,  then Intel shall have the right to demand from
          Convera  payment in full of the  Settlement  Amount then  outstanding,
          which  Convera  shall pay to Intel  within ten (10)  business  days of
          Intel's  written  demand  thereof  pursuant  to  this  Agreement.  For
          purposes  of this  Agreement,  the term "Cash  Liquidity"  shall mean,
          collectively, cash, short-term investments and accounts receivable.

     2.   Treatment of Subtenant  Payments.  If Intel  brokers a sublease with a
          third party for the facilities  located at 23245 NW Evergreen Parkway,
          Hillsboro,  Oregon (the "RC4  Space") on behalf of Convera  during the
          term of this Agreement,  then Convera shall divide with and distribute
          to Intel fifty percent (50%) of all such sublease proceeds received by
          Convera  until  such time as the total of such  proceeds  received  by
          Convera is equal to a maximum of One  Million  Five  Hundred  Thousand
          Dollars  ($1,500,000.00) (the "Maximum") (i.e., Intel shall receive up
          to Seven Hundred Fifty Thousand Dollars ($750,000.00) in proceeds from
          such RC4 Space  sublease)  (the  "Sublease  Incentive").  The Sublease
          Incentive shall  automatically  expire when the total of such sublease
          proceeds equals the Maximum,  and thereafter Convera shall exclusively
          retain for itself any such  sublease  proceeds  exceeding the Maximum.
          Convera  shall  make such  distributions  to Intel in  arrears  within
          thirty  (30) days of  Convera's  receipt  of such  payments  from such
          subtenant(s).  The foregoing distribution  obligation shall only arise
          if and when the subtenant pays Convera  pursuant to any such sublease.
          The Sublease Incentive is independent of the Settlement Amount and any
          such sublease  proceeds  distributed  to Intel by Convera shall not be
          treated as a set-off  against the  Settlement  Amount.  The use of the
          term "sublease" and "subtenant" in the singular herein shall be deemed
          to be  inclusive  of the plural to the extent that Intel  brokers more
          than one sublease on behalf of Convera for the RC4 Space. The proceeds
          of all such Intel-brokered  subleases shall be aggregated for purposes
          of calculating  whether  Convera has distributed the Maximum to Intel.
          Notwithstanding  the  foregoing,  Convera  and Intel agree that should
          Intel owe a broker's  fee or  commission  ("Fee")  to any third  party
          responsible  for finding a subtenant  for the RC4 Space,  then Convera
          and Intel shall split  equally the costs of the Fee.  Such  payment by
          Convera  shall be in addition to any amounts that Convera would pay to
          Intel pursuant to the foregoing Sublease Incentive.

     3.   No Admission of Liability.  Execution of this Agreement and compliance
          with its terms,  as provided  above, do not constitute an admission of
          liability or wrongdoing by either Party.

     4.   Entire Agreement.  This Agreement constitutes the entire agreement and
          understanding  of the Parties and supersedes  all prior  negotiations,
          understandings and agreements, proposed or otherwise, written or oral,
          concerning the subject matter hereof.  Furthermore, no modification of
          this  Agreement  shall be binding  unless in writing signed by each of
          the Parties hereto.

     5.   Severability.  Should any  provision  of this  Agreement  be  declared
          illegal or unenforceable by any court of competent jurisdiction and if
          such provision  cannot be modified to be  enforceable,  such provision
          shall immediately  become null and void, leaving the remainder of this
          Agreement in full force and effect.

     6.   Governing Law. This Agreement  shall be governed by, and construed and
          enforced  in  accordance  with,  the laws of the  state  of  Delaware,
          without regard to its conflicts of law principles.

     7.   Notices. Any notice,  demand or communication to be made under or with
          respect to this  Agreement  shall be in writing and shall be addressed
          as follows:

                  If to Convera:

                                    Mr. Chris M. Mann, CFO Convera Corporation
                                    1921 Gallows Road Vienna, Virginia 22182


                  If to Intel:      Intel Corporation
                                    Attn. Post Contract Management
                                    2111 N.E. 25th Avenue
                                    Hillsboro,OR 97124-5961

                                    With a Copy to:

                                    Office of General Counsel
                                    Intel Corporation
                                    2200 Mission College Boulevard
                                    Santa Clara, CA  95052

               All notices or other communications shall be delivered personally
          (effective upon receipt) or by reputable  overnight  delivery  service
          (effective  upon  delivery),  or by  facsimile  with  confirmation  of
          receipt (effective upon receipt of such confirmation), or by certified
          mail,  postage  prepaid,  return receipt  requested  (effective 3 days
          after posting), and in all cases a copy shall be forwarded by email at
          the addresses shown in this Agreement or as amended.

     8.   Assignment;  Effect of Change of Control.  This Agreement shall not be
          assigned by Convera without Intel's prior written consent,  at Intel's
          sole  discretion.  Notwithstanding  the Repayment  Period described in
          Section  1, if at any time  prior to  Convera's  full  payment  of the
          Settlement Amount a third party seeks to acquire all, or substantially
          all,  of the  assets  or  stock of  Convera  (i.e.,  at  least  50% of
          Convera's voting stock) or to merge with

               Convera,  or any other corporate  transactional  event that would
          result in Allen & Company,  Incorporated losing its controlling voting
          stock  interest in and control of the board of directors of Convera to
          one or more third parties (such events  collectively  referred to as a
          "Change of  Control  Event"),  then  Convera  shall pay,  prior to the
          closing of such Change of Control  Event,  the  remainder  of the then
          outstanding  Settlement  Amount  to Intel in a  single,  lump sum cash
          payment pursuant to this Agreement.

IN WITNESS WHEREOF, the aforesaid Parties have hereunto set their hands and
seals as of the date written below.

                                        CONVERA CORPORATION

                                        By:/s/ PATRICK C. CONDO

                                          INTEL CORPORATION

                                          By:  /s/ JOHN VINCENT