All posts
Musicrypt Extends and Expands BioPassword License
12/12/2003 12:17:00 PM
Toronto, Canada
Musicrypt Inc. of Toronto is pleased to announce that it has signed an agreement with BioNet Systems LLC of Bellevue Washington that extends and expands Musicrypt's licence to use BioNet's patented biometric technology, BioPassword.
In summary, this agreement extends Musicrypt's exclusive worldwide licence for BioPassword until July 31, 2006, and the non-exclusive licence until July 31, 2013. This agreement also expands the non-exclusive licence to include music videos and advertising, including advertising agencies, their clients, and other advertisers.
The licence provides Musicrypt with the exclusive worldwide rights to use the technology in connection with the communication of digital audio content within, to and among persons engaged in the creation, production and broadcast of music content, such as record companies, music producers, recording studios and radio broadcasters.
John Heaven, President and CEO of Musicrypt, said, "The extension of the exclusive and non-exclusive periods for the BioPassword licence should be welcome news to our stakeholders. We are also excited about the prospects for the digital distribution of music videos and expect the advertising field to offer a global market opportunity comparable to that of music distribution."
Mark DiSalle, CEO of BioNet stated, "We are very pleased to be working with Musicrypt and look forward to a long and mutually profitable relationship. Their DMDS application helps solve security issues centered around digital rights management over the Internet, and represents an excellent utilization of our BioPassword technology."
About the Licence:
Musicrypt will compensate BioNet with 750,000 common shares and a royalty of 5% of gross revenue. The shares are to be issued at the beginning of each of the first three contract years in amounts of 375,000, 187,500 and 187,500 respectively. These shares, and any others that may be issued under the agreement, are subject to the four-month hold period normally required by the TSX Venture Exchange. The maximum number of shares BioNet may sell is 75,000 in each of the first two months after the hold period, and 50,000 per month thereafter. No more than 10,000 shares may be offered for sale in one day. Minimum royalties of $50,000, $100,000 and $150,000 are payable respectively at the end of each of the first three years of the agreement. Musicrypt may pay any shortfall in royalties with either cash or shares. BioNet is to receive a minimum total return of USD 250,000 from the value of the shares and royalties remitted in each of the first two years of the agreement to continue the period of exclusivity. The agreement is subject to TSX Venture Exchange approval.
About BioPassword:
BioPassword uses a patented keystroke dynamics technology that makes biometric measurements of a keyboard user's individual typing rhythm when entering a password. BioPassword adds a transparent layer of authentication during the login process. Currently there is no competition for BioPassword using the keystroke dynamics due to a patent covering the proprietary nature of the algorithm, process and methods. The technology is currently being utilized within a variety of market verticals, including financial, healthcare, transportation, e-commerce and government.
About BioNet Systems, LLC:
BioNet Systems, LLC, a privately held company located in Issaquah, Washington, specializes in security products for both the home and enterprise markets. Since 1994, the company's award-winning Internet safety product, Net Nanny®, and patented strong user authentication technology, BioPassword®, have addressed the growing need to control access to mission-critical computer data and have given users the freedom to choose options that match their individual needs and value systems.
About Musicrypt:
Musicrypt's Digital Media Distribution System (DMDS) enables user-friendly and secure distribution of media via the Internet. DMDS is a web-based content delivery system that pioneers secure digital file distribution by incorporating biometrics. The first application of DMDS replaces the physical distribution of new musical recordings by record companies from the studio, internally, and to radio stations with more secure, more effective and less costly digital distribution via the Internet. DMDS delivers broadcast quality media from the sender securely and on time to authorized recipients. DMDS delivers the content person-to-person, rather than machine-to-machine. Musicrypt trades on the TSX Venture Exchange (TSX-V) in Toronto under the symbol MCT.
The statements contained in this release that are not purely historical are forward-looking statements and are subject to risks and uncertainties that could cause such statements to differ materially from actual future events or results. Such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
