Reference to E/__ is a reference to an exhibit in the unified file of exhibits created by the parties.
Factual Milestones
14. The business conduct between Shitrit and Shva began in 1987 or close thereto. Initially, Shitrit conducted himself as a sole proprietor and subsequently through the company he established, Mitug.
Over the years, Mitug provided Shva with services such as developing software intended for its use, delivering training, providing technical support, handling malfunctions, and performing upgrades. Documents were submitted to the file that are not relevant to our matter but testify to a prolonged business connection, such as agreements made between the parties over the years and invoices issued for work performed (E/84-E/87).
15. In an agreement dated March 13, 2005 (E/78; "2005 Agreement"), Shva ordered various services from Mitug, including several software products for Shva's ATM machines. Among other things, Mitug was supposed to supply software that would be developed based on the Aptra Edge software of NCR company (whereby Shva would purchase licenses for the Aptra Edge software). The 2005 Agreement also referred, among other things, to developments based on existing software of Mitug known as Multix ("Multix").
16. There is no dispute that after some time, Mitug announced there was a difficulty in developing software based on the Aptra Edge software (p. 104, lines 11-14). Shva complains that this announcement was contrary to Mitug's commitment under the agreement, a commitment Mitug took upon itself while declaring that it had the necessary ability, resources, knowledge, and experience. Mitug claims that the lack of prior familiarity with the Aptra Edge software was well known to Shva, and Shva chose to enter into the engagement without prior study of the aforementioned software being performed, due to cost considerations (p. 102 lines 9-14; and see also p. 98 lines 4-16; p. 103 lines 7-9).
Either way, there is no dispute that after other solutions were considered (including development based on NDC software of NCR), it was agreed between the parties that Mitug would develop software or a software component not based on Aptra Edge, in adaptation to the XFS standard implemented in Shva's ATM machines. This software developed by Mitug, the MultiXFS software, is at the base of the litigation.
17. Following this, a document dated June 21, 2006, was signed between the parties, titled: "Agreement for Use of MultiXFS Software" (E/53). The 2006 document does not refer directly to the 2005 Agreement, but it mentions that Mitug "performed for Shva a project of developing ATM machine software." It should be stated here that there is significant dispute between the parties regarding the meaning of the 2006 document.
18. The 2006 document was amended in December 2007. Its signing was preceded by a demand from Mitug for a change in rates, including for the software usage licenses (E/43-E/46). At that stage, disagreements also arose regarding rights in the software (MultiXFS), but the parties "skipped" over them and hoped there would be no need to address the matter ("This proposal is supposed to leave the existing situation regarding rights as is, each according to their understanding. Neither of us is waiving any right according to their understanding. I hope the cooperation will be positive and such that will not require either of us to sharpen the corners") (E/35, E/37; "2007 Agreement" or "2007 Amendment").
19. Since the signing of these documents, Shva and Mitug conducted themselves without unusual events being recorded, and at any rate, such were not brought before me.
20. In July 2013, following reports in the media regarding the sale of Shva's ATM activity, Shitrit contacted Milvitzky and noted, among other things, that within the framework of the sale, it must be ensured that Multix software components and the Software (MultiXFS software) are not transferred without Mitug's approval (Email dated July 14, 2013, E/24).