1
CERTAIN CONFIDENTIAL TREATMENT CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
EXHIBIT 10.15
DEVELOPMENT AND LICENSE AGREEMENT
Between
FIRST VIRTUAL CORPORATION
And
ADVANCED TELECOMMUNICATIONS MODULES LIMITED
February 25, 1994
2
TABLE OF CONTENTS
Page
ARTICLE 1 - DEFINITIONS 1
1.1 "ATML's ATM Technology" 1
1.2 "Buyer" 1
1.3 "Confidential Information" 2
1.4 "Developed Products" 2
1.5 "FVC Technology" 2
1.6 "Global Office Market" 2
1.7 "Intellectual Property Rights" 2
1.8 "Joint Development Program" 2
1.9 "Jointly Developed Technology" 2
1.10 "Licensed Party" 3
1.11 "Licensing Party" 3
1.12 "Licensed Products" 3
1.13 "Net Product Revenues" 3
1.14 "OEM Purchase Agreement" 3
1.15 "Olivetti Technology" 3
1.16 "Procured Products" 3
1.17 "Products" 3
1.18 "Seller" 3
Article 2 - Joint Development Program 3
2.1 Joint Development Program 3
2.2 Term; Extension 4
2.3 Development Expenses 4
2.4 Additional Partners 4
2.5 Market Intelligence and Product Positioning 4
2.6 Reports; Inspection 4
ARTICLE 3 - OWNERSHIP AND LICENSES 4
3.1 License to ATML Technology 4
3.2 License to FVC Technology 5
3.3 Cross Licenses to Jointly Developed Technology 6
3.4 Ownership of Jointly Developed Technology. 6
3.5 Exchange of Information Outside of the Scope of
the Joint Development Program 6
3.6 Dual Exclusivity 6
3.7 Grant-Back License 7
3.8 Marketing Rights for New Products 7
3.9 Olivetti Marketing Participation 7
3.10 Delivery of Technology 7
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TABLE OF CONTENTS
(continued)
Page
Article 4 - Manufacturing and Technical Assistance 8
4.1 Technical Assistance 8
4.2 Manufacturing; Most Favored Nations Pricing 9
4.3 Standby Manufacturing License for Procured Products 9
4.4 Shortages of Procured Products 10
Article 5 - Royalties 10
5.1 Royalty Obligation 10
5.2 Payment 11
5.3 Records, Audit 11
Article 6 - Confidential Information 11
6.1 Obligation 11
6.2 Return of Materials 11
6.3 Injunctive Relief 12
Article 7 - Representations and Warranties 12
7.1 Warranties by ATML 12
7.2 Warranties by FVC 13
Article 8 - Indemnity And Infringement of Third-Party Rights 13
8.1 Indemnity Obligation 13
8.2 Options 13
8.3 Conditions Precedent For Indemnities 14
Article 9 - Termination 14
9.1 Termination 14
9.2 Effect of Termination 14
9.3 Survival 14
9.4 Assignments and Sublicenses 15
Article 10 - Miscellaneous 15
10.1 Assignment 15
10.2 Force Majeure 15
10.3 Entire Agreement; Amendment 15
10.4 Notices 15
10.5 Governing Law and Construction 15
10.6 Severability 16
10.7 No Waiver 16
10.8 Section Headings 16
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TABLE OF CONTENTS
(continued)
Page
10.9 Independent Contractor 16
10.10 Disputes 16
iii
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DEVELOPMENT AND LICENSE AGREEMENT
This DEVELOPMENT AND LICENSE AGREEMENT ("Agreement") is entered into as
of the 25th day of February, 1994, by and between FIRST VIRTUAL CORPORATION
("FVC"), a California corporation with its principal place of business located
at 3333 Octavius Drive, Suite B, Santa Clara, CA 95054; and ADVANCED
TELECOMMUNICATIONS MODULES LIMITED ("ATML"), a corporation organized under the
laws of Great Britain with its registered office located at Home Farm, Fowlmere
Road, Heydon, Nr. Royston, Herts, SG8 8PZ England.
RECITALS
WHEREAS, ATML has entered into a License and Technical Co-Operation
Agreement with Ing. C. Olivetti & C., S.p.A. ("Olivetti") and its subsidiary
Olivetti Research Limited ("ORL") dated as of______, 1993 (the "Olivetti
Agreement") which grants to ATML certain rights to the Asynchronous Transfer
Mode Technology (as defined therein); and
WHEREAS, FVC desires to obtain from ATML certain rights to ATML's ATM
Technology, as defined hereafter; ATML desires to obtain from FVC certain rights
to the FVC Technology, as defined hereafter; and the parties desire to grant
such rights to each other; and
WHEREAS, the parties desire to make certain joint developments based
upon ATML's ATM Technology and to cross-license such joint developments; and
WHEREAS, the parties desire to purchase from each other and market
certain products;
NOW, THEREFORE, the parties agree as follows:
ARTICLE 1
DEFINITIONS
As used in this Agreement, the capitalized terms shall have the meanings
set forth below:
1.1. "ATML'S ATM TECHNOLOGY" shall mean all information, inventions,
technology, developments, processes, source and object code and other
copyrightable works and designs, including without limitation any improvements,
enhancements and modifications thereto, owned or controlled by ATML (with the
right to sublicense others) as of the Effective Date, including without
limitation, the Olivetti Technology, all as set forth, without limitation, on
Exhibit A, together with such additional technology owned or controlled by ATML
and not already licensed to FVC hereunder as ATML and FVC may mutually agree by
adding it after the Effective Date to Exhibit A hereunder.
1.2 "BUYER" shall mean the party purchasing Procured Products from
the other party pursuant hereto.
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1.3 "CONFIDENTIAL INFORMATION" shall mean, if applicable, the
following items which are owned by either party or as to which such party has an
obligation to keep confidential: all information, computer programming language,
know-how, technical data, ideas, techniques, devices, inventions, improvements,
technology, trade secrets, developments, process, designs, methods, plans,
specifications, algorithms and other mathematical formulae, source and object
codes, plans for research and development, new products, marketing or selling,
and information about licenses, prices, costs, suppliers, customers and
compensation of such party's employees and independent contractors, whether in
oral, written, graphic or electronic form. The term Confidential Information
shall not include any item of information which (a) the receiving party can
prove was in its possession prior to disclosure thereof by the disclosing party,
(b) is or becomes generally available to the public other than as a result of
any action by the receiving party or the parties to whom the receiving party is
permitted to disclose hereunder, (c) is rightfully disclosed to the receiving
party by a third party without the imposition on the receiving party of any
confidentiality obligation or restrictions on use or (d) the disclosing party
states in writing should not be considered to be confidential.
1.4 "DEVELOPED PRODUCTS" shall mean those products, systems and
services to be developed by the parties under the Joint Development Program.
1.5 "FVC TECHNOLOGY" shall mean all information, inventions,
technology, developments, processes, source and object code and other
copyrightable works and designs, including without limitation any improvements,
enhancements and modifications thereto, owned or controlled by FVC (with the
right to sublicense others) during the term of this Agreement and not already
licensed to ATML hereunder as FVC and ATML may mutually agree by adding it to
Exhibit A hereunder.
1.6 "GLOBAL OFFICE MARKET" shall mean the worldwide market for use
in connection with commercial businesses, corporations or entities, governmental
agencies or entities and nonprofit corporations. The "Global Office Market"
shall not include uses designed primarily for home or residential purposes or
uses designed primarily for the purpose of providing telecommunications services
to a commercial business, such as services provided by PTTs and telephone
companies.
1.7 "INTELLECTUAL PROPERTY RIGHTS" shall mean trade secrets, patent,
copyright, mask work, "moral" or other similar rights under all jurisdictions
throughout the world.
1.8 "JOINT DEVELOPMENT PROGRAM" shall mean that program for the
development of the Products as set forth on Exhibit B hereto.
1.9 "JOINTLY DEVELOPED TECHNOLOGY" shall mean all information,
inventions, technology, developments, processes, source and object code and
other copyrightable works, and designs arising out of ATML's and/or FVC's
development activities hereunder (including development activities of each
party's partners under Section 2.4 hereof and to which such party has
sublicensable rights) and including any improvements, enhancements and
modifications thereto created or reduced to practice during the term of the
Joint Development Program.
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1.10 "LICENSED PARTY" shall mean the party receiving a license to the
technology in question pursuant to Article 3 of this Agreement
1.11 "LICENSING PARTY" shall mean the party granting a license to the
technology in question pursuant to Article 3 of this Agreement.
1.12 "LICENSED PRODUCTS" shall mean any products, systems and
services incorporating any of the ATML ATM Technology developed, manufactured or
sold by or for FVC and any products, systems and services incorporating any of
the FVC Technology developed, manufactured or sold by or for ATM, pursuant to
licenses granted hereunder.
1.13 "NET PRODUCT REVENUES" shall mean all sums invoiced by the
Licensed Party for sales, leases, licenses, rentals or other conveyances for
value of Licensed Products, but not including amounts invoiced for taxes,
duties, insurance, shipping costs, installation, maintenance, consultation,
training, interest, finance charges, refunds, credits, rebates or allowances,
regardless of whether such amounts are separately invoiced.
1.14 "OEM PURCHASE AGREEMENT" shall mean a mutually acceptable
bilateral form of purchase agreement containing reasonable terms and conditions
under which the parties will purchase any Procured Products from each other.
1.15 "OLIVETTI TECHNOLOGY" shall mean the Licensed Technology, as
defined and licensed to ATML pursuant to the Olivetti Agreement.
1.16 "PROCURED PRODUCTS" shall mean ATML, products or FVC products
purchased by the other party from the list of such products set forth on Exhibit
C hereto, as such list shall be updated by mutual written agreement at least
quarterly.
1.17 "PRODUCTS" shall mean Developed Products, Licensed Products
and/or Procured Products, as the context requires.
1.18 "SELLER" shall mean the party selling Procured Products to the
other party pursuant hereto.
ARTICLE 2
JOINT DEVELOPMENT PROGRAM
2.1 JOINT DEVELOPMENT PROGRAM. ATML and FVC shall each use
reasonable efforts to develop the Developed Products in accordance with the
Joint Development Program and on the terms and conditions set forth herein. The
parties have agreed to an initial Joint Development Program plan, attached
hereto as Exhibit B, and they each acknowledge that such Joint Development
Program plan shall be updated on a quarterly basis by ATML and FVC, including
without limitation by establishing a mutually agreeable schedule for such
development activities.
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2.2 TERM; EXTENSION. The Joint Development Program shall commence on
the Effective Date and shall terminate on the second anniversary thereof,
subject to extension by mutual written consent of the parties and to termination
pursuant to Section 9.1 below.
2.3 DEVELOPMENT EXPENSES. Each party shall bear its own costs and
expenses relating to the development activities performed by it in connection
with the Joint Development Program.
2.4 ADDITIONAL PARTNERS. FVC and ATML agree that one of the goals of
the Joint Development Program is to obtain appropriate partners to develop and
manufacture certain components of the Products and to manufacture directly high
value-added components of and software for the Products.
2.5 MARKET INTELLIGENCE AND PRODUCT POSITIONING. During the term of
the Joint Development Program, the parties will exchange marketing information
on the Products for the purpose of (a) giving inputs to their respective R&D
groups on market requirements, (b) optimizing product positioning and (c)
improving the respective market visibility for a better definition of product
strategy.
2.6 REPORTS; INSPECTION. ATML and FVC shall each provide to the
other party monthly written reports setting forth the status of the developments
under the Joint Development Program and shall allow the other party reasonable
access to its facilities to inspect the advancement of such developments.
ARTICLE 3
OWNERSHIP AND LICENSES
3.1 LICENSE TO ATML TECHNOLOGY.
(a) ATML hereby grants to FVC a perpetual, worldwide,
non-sublicensable (except with respect to end-user binary code software licenses
and except as permitted under Section 9.4 below) license under ATML's ATM
Technology, including a sublicense under the Olivetti Technology, to (i) develop
the Developed Products in accordance with the Joint Development Program and (ii)
make, have made, sell, lease, copy, modify, distribute or otherwise exploit
products, including without limitation the Licensed Products and the Developed
Products. The license to Licensed Products shall bear a royalty as set forth in
Article 5 below. Notwithstanding anything to the contrary provided herein, those
items of ATML's ATM Technology that are identified as Procured Products on
Exhibit C shall not be deemed included in the rights granted FVC under this
Section 3.1 (a), other than for the right to buy such items from ATML in the
form of Procured Products and for the right to incorporate them in Licensed
Products made by or for FVC.
(b) Such license to sell, lease or distribute shall be
exclusive in the Global Office Market (except as provided in the last sentence
of this Section 3.1 (b) and in Sections 3.1 (c) and 3.1 (d) below) for the
period commencing on the Effective Date and ending on the later of (a) March 31,
1995 or (b) twelve (12) months after the date on which FVC has shipped or
otherwise provided its first Licensed Products to its first commercial customer.
Thereafter
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such license shall continue on a non-exclusive basis. Notwithstanding such
exclusivity, ATML shall retain such rights under ATML's ATM Technology and
Jointly Developed Technology for the Global Office Market after March 31, 1995
for Europe and after December 31, 1995 for all other markets (i.e., ATML and FVC
shall each have such rights).
(c) Notwithstanding such exclusive rights, FVC acknowledges
that ATML shall, have the right to grant to investors holding at least 10% of
ATML's equity (i.e., voting share capital) the right to lease, sell or
distribute any and all products based on or incorporating the ATML ATM
Technology directly or indirectly in any market under their respective
trademarks or names.
(d) FVC acknowledges that ATML's license to the Olivetti
Technology under the Olivetti Agreements is non-exclusive except that Olivetti
and its Affiliates (as defined therein) have covenanted not to exercise their
right to make or have made equipment based on the Olivetti Technology so long as
ATML fulfills the requirements of Olivetti and its Affiliates for products based
on the Olivetti Technology, in accordance with the terms and conditions of such
Olivetti Agreements. ATML covenants and agrees with FVC to use its best efforts
to fulfill such requirements and to notify FVC within thirty (30) days of ATML's
discovery of any fact that will require it to fail to met its supply obligation
to Olivetti or receipt of any notice of default with respect to such obligation.
(e) The parties recognize that in certain events, as set
forth in the Olivetti Agreement, Olivetti's license of the Olivetti Technology
to ATML may terminate. In such an event, Olivetti has agreed in the letter
agreement (the "Olivetti Letter") attached hereto as Exhibit E, to grant FVC a
direct, perpetual license to the Olivetti Technology on the same terms and
conditions as ATML's sublicense to FVC under Section 3. 1 (a) above. In such an
event, the parties hereby agree that FVC's obligations to Olivetti under such
license shall supersede FVC's obligations to ATML, with respect to the Olivetti
Technology hereunder, and that any royalty obligations of FVC to Olivetti under
such license and to ATML hereunder will be apportioned between Olivetti and ATML
in the proportion [ * ] so that FVC's combined royalty obligations to Olivetti
and ATML shall not exceed FVC's royalty obligations to ATML hereunder.
3.2 LICENSE TO FVC TECHNOLOGY. FVC hereby grants to ATML a
perpetual, worldwide, non-sublicensable (except with respect to end-user binary
code software licenses and except as permitted under Section 9.4 below) license
under the FVC Technology to (i) develop the Developed Products in accordance
with the Joint Development Agreement and (ii) make, have made, sell, lease,
copy, modify, distribute or otherwise exploit products, including without
limitation the licensed Products and the Developed Products. The license to
Licensed Products shall bear a royalty as set forth in Article 5 below.
Notwithstanding anything to the contrary provided herein, those items of FVC's
Technology that are identified as Procured Products on Exhibit C (if any) shall
not be deemed included in the rights granted ATML under this Section 3.2, other
than for the right to buy such items from FVC in the form of Procured Products
and for the right to incorporate them in Licensed Products made by or for ATML.
[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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3.3 CROSS LICENSES TO JOINTLY DEVELOPED TECHNOLOGY.
(a) FVC hereby grants to ATML a non-exclusive, perpetual
(except as provided in Section 9.1), royalty-free, non-sublicensable (except for
end-user binary code software licenses and except as permitted under Section 9.4
below) worldwide license under FVC's Jointly Developed Technology to make, have
made, sell, license, lease, copy, modify, distribute or otherwise exploit any
product and for any other purposes whatsoever.
(b) ATML hereby grants to FVC a non-exclusive, perpetual
(except as provided in Section 9.1) royalty-free, non-sublicensable (except for
end-user binary code software licenses and except as permitted under Section 9.4
below) worldwide license under ATML's Jointly Developed Technology to make, have
made, sell, license, lease, copy, modify, distribute or otherwise exploit any
product and for any other purposes whatsoever.
(c) Notwithstanding the foregoing limitation on
sublicensing, FVC agrees that ATML shall have the right to grant to investors
holding at least 10% of ATML's equity (i.e., voting share capital) the right to
lease, sell or distribute any and all products based on or incorporating the
Jointly Developed Technology directly or indirectly in any market under their
respective trademarks or names.
3.4 OWNERSHIP OF JOINTLY DEVELOPED TECHNOLOGY. All Intellectual
Property Rights, including without limitation copyrights, in the Jointly
Developed Technology shall be jointly owned by FVC and ATML. To the extent
required to confirm such joint ownership, the parties hereby agree to assign to
each other an undivided one-half interest in the Jointly Developed Technology.
The parties agree that each shall be free to use and commercially exploit the
Jointly Developed Technology (subject to all other provisions of this
Agreement), and there shall be no obligation of payment or accounting to the
other therefor; provided, however, that each party shall use best efforts to
give the other party prior written notice of any such use. The parties agree
that the Jointly Developed Technology shall not include any inventions, or other
intellectual property of any type which existed prior to the effective date of
this Agreement, or which was not created by the joint efforts of the parties in
connection with this Agreement.
3.5 EXCHANGE OF INFORMATION OUTSIDE OF THE SCOPE OF THE JOINT
DEVELOPMENT PROGRAM. During the term of the Joint Development Program, the
parties will inform each other on their respective R&D activities in fields
outside of the scope of the Joint Development Program, but related to ATM
technology, in order to evaluate the desirability for both parties to extend the
scope of the cooperation envisaged in this Agreement.
3.6 DUAL EXCLUSIVITY. In consideration of the exclusive marketing
rights granted to FVC hereunder, until March 31, 1995, for Europe and until
December 31, 1995, for all other markets, FVC agrees not to market any product
other than the Products in direct competition (i.e., with similar function,
price and performance) with the Licensed Products, ATML's ATM Technology and the
Jointly Developed Technology unless otherwise mutually agreed in writing with
ATML. In consideration of the foregoing and FVC's other obligations hereunder,
ATML agrees not to license the ATML ATM Technology or the Jointly Developed
Technology or sell (except to end-users and distributors who are not OEMs or
VARs with respect to the Products)
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licensed Products, Developed Products or Procured Products to any company whose
stock is not traded on a nationally-recognized stock exchange or automated
national market system where the resulting products or such products would
directly compete (i.e., with similar function, price and performance) with those
of FVC.
3.7 GRANT-BACK LICENSE. Each party grants to the other party a
non-exclusive, perpetual (except as provided in Section 9.1), royalty-free,
non-transferable and nonsublicensable (except with respect to end-user binary
software licenses and except as permitted under Section 9.4), worldwide license
to make, have made, sell, license, lease, copy, modify, distribute or otherwise
exploit any enhancement, derivative or modification of a Licensed Product
created or reduced to practice by such party during the term of the Joint
Development Program.
3.8 MARKETING RIGHTS FOR NEW PRODUCTS. Subject to the exclusivity
rights granted in Section 3.1(b) (to above, and during the term of the Joint
Development Program, each party shall have non-exclusive worldwide marketing
rights for all new products of the other party not constituting Products
hereunder at the most favored nation pricing arrangement referred to in Section
4.2 below.
3.9 OLIVETTI MARKETING PARTICIPATION. FVC agrees to discuss the
terms of a possible marketing collaboration for the Products in Europe with
Olivetti on such terms and conditions as FVC and Olivetti may mutually agree in
writing.
3.10 DELIVERY OF TECHNOLOGY.
(a) To the extent not previously provided, upon execution of
this Agreement, and no less frequently than quarterly thereafter, each of the
parties shall provide the other party with all source and object code and
documentation with respect to the technology covered by the licenses granted in
this Article 3 and with respect to the Licensed Products, Developed Products and
Procured Products, including without limitation:
(i) Complete electronic design materials required to
produce any semiconductor parts, including tapes, Verilog files and similar
materials;
(ii) Engineering drawings of all assemblies and
schematics, and logic and timing diagrams;
(iii) Complete adjustment, operational and
installation specifications;
(iv) Service test procedures and a list of any
special tools and service test equipment designed by such party;
(v) Service, parts identification, service training,
maintenance and operator's manuals;
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(vi) Software and firmware source listings and
related documentation when necessary to effect an interface or for maintenance
purposes;
(vii) Engineering drawings, logic diagrams and
documentation necessary for interfacing any Product to the remainder of any
system in which it has been designed for use; and
(viii) Any other documentation concerning the operation
and maintenance of any Product which will permit the other party to develop a
complete set of operator and service manuals.
(b) Such documentation shall be of the type which is used by
such party's personnel, shall be in a form capable of reproduction, and shall be
updated by new documentation from time-to-time as it becomes available. The
other party shall have the right to copy, modify and use, and have copied,
modified and used, the documentation provided by such party for the purposes of:
(i) each party utilizing the licenses granted in this Article 3; (ii) Buyer
utilizing the license granted under Section 4.3 of this Agreement, provided that
Buyer shall be entitled under the provisions of Section 4.3 to utilize such a
license; and (iii) each party providing manuals or the like concerning the
Products, provided that any copyrights therein are appropriately safeguarded,
and each party shall have the right to copyright any such manuals developed by
the other party in connection with its sale of the other party's Products.
(c) The foregoing to the contrary notwithstanding, Seller
shall not be required to deliver directly to Buyer the complete electronic
design materials with respect to the Procured Products specified in Section
3.10(a)(i) above, but shall instead deliver them, on a timely basis (i.e., when
related documentation is also delivered in accordance with Section 3.10), to a
mutually satisfactory escrow agent or escrow agents pursuant to a mutually
satisfactory form of escrow agreement under which the escrow agent would hold
such materials for delivery to Buyer should the license for the Procured Product
in question under Section 4.3 come into effect. ATML and FVC agree to negotiate
in good faith and enter into such an escrow agreement or escrow agreements
within 90 days of the date of this Agreement.
ARTICLE 4
MANUFACTURING AND TECHNICAL ASSISTANCE
4.1 TECHNICAL ASSISTANCE. To assist each other in its performance
hereunder, during the term of the Joint Development Program, each party agrees
to make available to the other, at the appropriate party's facilities during
normal business hours, such assistance as may be reasonably required for the
completion of the development work. The party receiving such assistance shall be
responsible for any and all expenses associated with such assistance including
without limitation reasonable travel, lodging, meal and other expenses of the
providing party's employees or agents, except the compensation of the providing
party's personnel. Except as otherwise provided in this Section 4.1, each party
will be responsible for obtaining all the intellectual property, technology,
labor, materials, tooling and facilities for the completion of the development
services to be performed by it hereunder.
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4.2 MANUFACTURING; MOST FAVORED NATIONS PRICING. Seller shall
manufacture or have manufactured for Seller the Procured Products. Buyer shall
purchase Procured Products from Seller pursuant to the OEM Purchase Agreement.
Each party may manufacture Products other than Procured Products itself or
contract for such manufacture with any third party, including without limitation
the other party. Any manufacturing arrangement between ATML and FVC or a third
party manufacturing for either of them shall be on such terms and conditions as
the parties may hereafter agree in writing; provided, however, that any such
arrangement shall provide for the purchasing party to receive most favored
nations pricing for any products so manufactured and purchased. In the event
that either party intends to utilize a third party for manufacturing the
Developed Products, the parties shall evaluate the desirability of relying upon
a common manufacturer. In such a case, both parties will have the right to
procure the Developed Products directly from such manufacturer at a common
price.
4.3 STANDBY MANUFACTURING LICENSE FOR PROCURED PRODUCTS.
(a) In the event this Agreement is terminated by Buyer
pursuant to Section 9.1 hereof or if Seller is, for any reason, unable to supply
Buyer with Buyer's "reasonable requirements" of a Procured Product ordered by
Buyer under the terms of this Agreement, Seller hereby grants to Buyer an
irrevocable and non-exclusive worldwide right and license to all information,
inventions, technology, developments, processes, source and object code, and
other copyrightable works and designs, including without limitation any
improvements, enhancements and modifications thereto, owned or controlled by
Seller used or useful in such Procured Product and any other manufacturing
rights of Seller necessary for Buyer to manufacture or have manufactured such
Procured Product. Seller shall, under such circumstances and at such time,
furnish to Buyer without cost all necessary assistance as will permit Buyer to
commence manufacture of such Procured Product including, but not limited to,
updating documentation with respect to such Procured Product already provided
under Section 3.10 of this Agreement, along with reasonable amounts of technical
assistance. In addition, Seller agrees to sell or lease to Buyer, if Buyer
desires, and based on its then fair market value, tooling owned or controlled by
Buyer and necessary for such manufacture of such Procured Product. The license
to manufacture Procured Products, to the extent utilized by Buyer under this
Section 4.3 , shall bear a royalty as set forth in Article 5 below; provided,
however, that Buyer shall not be liable for such royalty if and to the extent
that Buyer also becomes liable for royalties under Section 3.1 or 3.2, as the
case may be, with respect to such Procured Product by reason of Buyer exercising
its rights under this Section 4.3.
(b) For purposes of this Section 4.3, Seller shall be deemed
unable to supply Buyer's "reasonable requirements" only if:
(i) Seller fails to deliver the entire quantity of
such Procured Product ordered by Buyer for any two consecutive months; and
(ii) The quantity of such Procured Product that
Seller delivers by the end of the third consecutive month does not cover the
entire quantity of such Procured Product ordered by Buyer for the three months
taken together.
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(c) For purposes of this Section 4.3, Buyer's requirements
shall be deemed to be "reasonable" only if:
(i) On a quarterly basis, Buyer shall have provided
Seller with a rolling twelve-month forecast of its requirements for such
procured Product;
(ii) Buyer shall have issued to Seller at least
thirteen (13) weeks prior to the shipment date specified by Buyer a purchase
order covering its requirement for such Procured Product; and
(iii) Purchase Orders for Procured Products to be
shipped during the month in question shall not have exceeded 150% of those
forecast for such month in the last rolling forecast received by Seller.
(d) All forecasts delivered by Buyer under subsection 4.3(c)
above shall represent Buyer's current good faith estimate of its requirements
for Procured Products for the periods stated.
(e) No Buyer may claim its "reasonable requirements" with
respect to a Procured Product were not met hereunder to the extent that Seller
has not accepted a purchase order or has not shipped a Procured Product by
reason of the fact that Buyer, after written notice from Seller thereof and
thirty days to cure, is in material breach of the terms and conditions of its
OEM Purchase Agreement to buy Procured Products from Seller.
4.4 SHORTAGES OF PROCURED PRODUCTS. In the event there are any shortages
of Procured Products so that the available unit volume of such Procured Products
does not meet both parties' needs:
(a) the parties will work together to help solve any design,
development, manufacturing or similar problem causing such shortages; and
(b) during the term of such shortage, the Procured Products
shall be allocated half-half between the parties until at least one party's
needs are met.
ARTICLE 5
ROYALTIES
5.1 ROYALTY OBLIGATION. The Licensed Party shall pay to the
Licensing Party a royalty based on Net Product Revenues for sales by the
Licensed Party of Licensed Products that are manufactured by or for the Licensed
Party in the percentages set forth below:
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Year Percentage of Net Product Revenues
- ---- ----------------------------------
[ * ]
For the purposes of calculating such royalties, the first yearly period
shall commence on the date of the Licensed Party's first commercial shipment of
its first Licensed Product hereunder. No royalty shall be payable hereunder on
Products manufactured by the Licensing Play or on its behalf for sale to the
Licensed Party.
5.2 PAYMENT. Royalties payable hereunder shall be calculated on a
calendar quarter basis and shall be due and payable in U.S. dollars by FVC and
in British pounds by ATML within forty-five (45) days after the end of each
quarter, beginning with the calendar quarter in which the first commercial sale
of applicable Products occurs. Each royalty payment shall include a true and
complete accounting of Net Product Revenues of the applicable Licensed Products
during the calendar quarter.
5.3 RECORDS, AUDIT. FVC shall keep complete and accurate records
pertaining to its sale of Products for a one (1) year period following the year
in which any such payments were made hereunder. ATML will have the right to
engage, at its own expense, an independent, certified public accountant
reasonably acceptable to FVC, to examine FVC's records to determine, with
respect to any calendar year, the correctness of any report or payment made
under this Agreement. Such right shall be exercisable once during the one year
period following the date on which the relevant payments were made.
ARTICLE 6
CONFIDENTIAL INFORMATION
6.1 OBLIGATION. Each party shall make available to the other party,
and permit the other party access to, all the Confidential Information of such
disclosing party reasonably necessary to enable the receiving party to perform
its obligations under this Agreement. The receiving party agrees to keep
confidential and not to use, disclose or make available for use, except in the
proper performance of its duties and responsibilities hereunder or in the
exercise of its rights hereunder, any Confidential Information. The receiving
party agrees that any dissemination of any Confidential Information to its
employees shall be only as is necessary to carry out the purposes of this
Agreement, shall be limited to the maximum extent possible consistent with
carrying out such purposes, and shall be limited to these employees who have
agreed to be bound by the receiving party's confidentiality and non-use
obligations.
6.2 RETURN OF MATERIALS. The receiving party shall, at any time upon
the disclosing party's request, promptly deliver to the disclosing party or its
designee all tangible property which has been furnished to the receiving party
by the disclosing party or which evidences,
[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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constitutes, embodies or reflects any Confidential Information. Such property
shall include, without limitation, all property in which the disclosing party
has ownership rights pursuant to Section 3.3 above at whatever stage of
completion such property may be as of such termination.
6.3 INJUNCTIVE RELIEF. Each party agrees that remedies at law are
inadequate to protect against any breach of this Article 6. Accordingly, the
disclosing party may seek or obtain injunctive relief against any such breach or
threat thereof in addition to any other legal remedies which may be available,
and the receiving party hereby consents to the granting of injunctive relief,
whether temporary, preliminary, or final, in favor of the disclosing party
without proof of actual damages and without the necessity of posting a bond or
other security.
ARTICLE 7
REPRESENTATIONS AND WARRANTS
7.1 WARRANTIES BY ATML. ATML represents and Warrants that:
(a) the ATML Technology (excluding the Olivetti Technology)
and the Jointly Developed Technology to be developed by ATML hereunder are and
shall be original works and ATML is not currently aware of any infringement of
rights of any third party by the ATML Technology;
(b) ATML owns and possesses all right, title and interest in
and to all Intellectual Property Rights related to such ATML Technology and such
ATML Jointly Developed Technology and such are subject to no liens,
encumbrances, security interests or the like of any kind whatsoever;
(c) ATML will not use any trade secrets or confidential or
proprietary information owned by any third party in performing its services and
obligations under this Agreement;
(d) ATML's entering into and performance of this Agreement
does not contravene the terms, provisions or conditions of any instrument or
contract by and between ATML and any other party, including, without limitation,
the Olivetti Agreement, a true and correct copy of which is attached as Exhibit
D;
(e) ATML is under no obligation or restriction, nor will
ATML assume any such obligation or restriction during the term of this
Agreement, which would in any way interfere or be inconsistent with or present a
conflict of interest concerning the services to be furnished by ATML under this
Agreement; and
(f) ATML has the full right, power and authority to enter
into this Agreement.
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7.2 WARRANTIES BY FVC. FVC represents and warrants that:
(a) the FVC Technology and the Jointly Developed Technology
to be developed by FVC hereunder are and shall be original works and FVC is not
currently aware of any infringement of rights of any third party by the FVC
Technology;
(b) FVC will own and possess all right, title and interest
in and to all Intellectual Property Rights related to such FVC Jointly Developed
Technology and such are subject to no liens, encumbrances, security interests or
the like of any kind whatsoever;
(c) FVC will not use any trade secrets or confidential or
proprietary information owned by any third party in performing its services and
obligations under this Agreement;
(d) FVC's entering into and performance of this Agreement
does not contravene the terms, provisions or conditions of any instrument or
contract by and between FVC and any other party;
(e) FVC is under no obligation or restriction, nor will FVC
assume any such obligation or restriction during the term of this Agreement,
which would in any way interfere or be inconsistent with or present a conflict
of interest concerning the services to be furnished by FVC under this Agreement;
and
(f) FVC has the full right, power and authority to enter
into this Agreement.
ARTICLE 8
INDEMNITY AND INFRINGEMENT OF THIRD-PARTY RIGHTS
8.1 INDEMNITY OBLIGATION.
(a) Each party agrees to indemnify and hold the other party
harmless from and against any and all damages, claims, losses or liabilities,
including without limitation attorneys' and other professional fees, resulting
from any breach by such indemnifying party of any of the representations,
warranties or covenants set forth herein.
(b) Each party agrees to indemnify and hold the other party
harmless from and against any and all damages, claims, losses or liabilities,
including without limitation attorneys' and other professional fees, resulting
from the infringement of the rights of any third party by any of the Licensed
Technology licensed by such party to the other party and by any of the Jointly
Developed Technology developed by such party hereunder; provided, however, that
such indemnification shall be limited to the offset by the other party of not
more than fifty percent (50%) of the royalties owed to such party by the other
party under the royalty provisions of Sections 3.1, 3.2, 4.3 and Article 5
hereof.
8.2 OPTIONS. Should any applicable product become or, in the
indemnifying party's opinion, be likely to become the subject of a claim of
infringement of a third party's Intellectual
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Property Rights, the indemnifying party may, at its option and expense either
(a) procure for the indemnified party the necessary rights to make the use of
such product noninfringing or (b) replace or modify such product such that the
indemnified party may use such product without infringing upon any such third
party's rights.
8.3 CONDITIONS PRECEDENT FOR INDEMNITIES. The obligation of the
indemnifying party to indemnify the indemnified party under Section 8.1 is
conditioned upon (a) the indemnified party giving prompt notice of a claim to
the indemnifying party, (b) the indemnifying party receiving the full
cooperation of the indemnified party in connection with the defense of such
claim (at the indemnifying party's expense), and (c) the indemnifying party
having the right to control and direct the investigation, preparation, defense
and, upon the consent of the indemnified party not to be unreasonably withheld,
settlement of such claim. The indemnified party may participate in such action
at its own expense through separate legal counsel.
ARTICLE 9
TERMINATION
9.1 TERMINATION.
(a) Either party may terminate this Agreement upon sixty
(60) days' written notice for material breach by the other party of any other
term, condition, obligation or warranty under this Agreement, if said breach is
not cured during said sixty (60) day period.
(b) If a party becomes insolvent or bankrupt, makes an
assignment for the benefit of creditors, has a trustee or receiver appointed for
it, becomes the subject party of any voluntary or involuntary insolvency,
bankruptcy or reorganization proceeding, which, in the case of any involuntary
proceeding, is not dismissed within sixty (60) days after it is commenced, or
discontinues its business, then the other party may terminate this Agreement
effective immediately upon giving written notice to such party. All rights and
licenses granted to the parties under or pursuant to this Agreement are and
shall be deemed to be, for purposes of Section 365(n) of the U. S. Bankruptcy
Code, licenses of rights to intellectual property as defined under Section 101
of the U.S. Bankruptcy Code. The parties agree that each party, as a licensee of
such rights under this Agreement, shall retain and may fully exercise all of its
rights and elections under the U.S. Bankruptcy Code.
(c) In event of a dispute arising under this Agreement, both
party's rights and obligations will continue during the pendency of such
dispute.
9.2 EFFECT OF TERMINATION. In the event that a party terminates this
Agreement for breach by the other party pursuant to Section 9.2(a) above, the
licenses granted hereunder to the non-breaching party shall survive.
9.3 SURVIVAL. Section 4.3 [Standby Manufacturing License for
Procured Products] and Articles 5 [Royalties], 6 [Confidential Information]; 7
[Representations and Warranties] and 8 [Indemnity and Infringement of
Third-Party Rights] will survive any termination of this Agreement.
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9.4 ASSIGNMENTS AND SUBLICENSES. The licenses granted under Section
3 hereof may not be assigned, transferred or sublicensed in any manner without
the prior written consent of the other party, which consent shall not be
unreasonably withheld. FVC hereby consents to the sublicense by ATML of all of
ATML's right under Section 3.3(a) to Olivetti.
ARTICLE 10
MISCELLANEOUS
10.1 ASSIGNMENT. During the term of the Joint Development Program,
neither this Agreement nor any right or obligation arising hereunder may be
assigned or subcontracted by either party in whole or in part, without the prior
written consent of the other party. This Agreement shall be binding upon any
permitted assignee and inure to the benefit of the successors and assigns of
each of the parties hereto.
10.2 FORCE MAJEURE. If performance of this Agreement or of any
obligation hereunder is prevented, restricted or interfered with by: fire or
other casualty or accident; strikes or labor disputes; war or other violence;
unavailability of or delays in procuring materials (including without limitation
semiconductor chips), power or supplies; any law, order, proclamation,
regulation, ordinance, demand or requirement of any governmental or
intergovernmental agency or body; or any other act or condition whatsoever
beyond the reasonable control of the party affected thereby, the party so
affected shall be excused from such performance during the time such prevention,
restriction or interference persists so long as such party takes all actions
available to it to limit the duration of such prevention, restriction or
interference.
10.3 ENTIRE AGREEMENT; AMENDMENTS. This Agreement, together with the
Exhibits hereto which are incorporated herein by reference, sets forth and
constitutes the entire, exclusive and complete agreement between the parties
hereto with respect to the subject matter hereof, and supersedes any and all
prior agreements, understandings, promises and representations, oral or written,
made by either party to the other concerning the subject matter hereof and terms
applicable hereto. This Agreement may not be released, discharged, amended or
modified in any manner except by an instrument in writing signed by duly
authorized officers of both parties hereto.
10.4 NOTICES. Unless otherwise specified herein, all notices,
approvals and other communications hereunder shall be in writing and shall be
delivered personally or by telex or telefax or mailed by registered or certified
mail, first class, postage prepaid, to the parties hereto at their addresses
specified herein, subject to the right of either party to change its address by
written notice. Any communication required or permitted hereunder shall be
deemed delivered upon personal delivery, twenty-four (24) hours after telex or
telefax transmission, or ninety-six (96) hours after deposit in any official
post box.
10.5 GOVERNING LAW AND CONSTRUCTION. This Agreement shall be governed
in all respects by the laws of the State of California, excluding choice of law
rules and the U.N. Convention on the Sale of Goods.
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10.6 SEVERABILITY. Should any provision of this Agreement be held to
contravene any law or regulation or be unenforceable, then such provision shall
be automatically terminated to the extent of such contravention or
unenforceability and performance thereof by the parties waived, and such
provision to the extent not in such contravention or unenforceable and all other
provisions of this Agreement shall continue in full force and effect.
10.7 NO WAIVER. No waiver of any right by either party under this
Agreement shall be deemed effective unless contained in a writing signed by such
party, and no waiver of any right arising from any breach or failure to perform
shall be deemed to be a waiver of any future such right or of any other right
arising under this Agreement.
10.8 SECTION HEADINGS. The titles and subtitles used in this
Agreement are for convenience only and are not a part of this Agreement and do
not in any way limit or amplify the terms and provisions of this Agreement.
10.9 INDEPENDENT CONTRACTOR. Each party is an independent contractor
and nothing herein shall be deemed to constitute the parties hereto as partners
or joint venturers or similarly related, and neither party shall have the right
to bind the other in any respect. Personnel supplied by each party will be
deemed employees of such party and will not, for any purpose, be considered
employees or agents of the other. Each party assumes full responsibility for the
actions of such personnel hereunder and shall be solely responsible for their
supervision, daily direction and control, payment of salary (including
withholding of income taxes), worker compensation, disability benefits and any
other form of compensation or benefit. Each party shall defend, indemnify and
hold the other harmless from and against any claim, demand, liability, damage or
loss (including without limitation attorney's and other professional fees) with
respect to those items described in the immediately preceding sentence or any
other item of any nature relating to any personnel of the party performing
services hereunder.
10.10 DISPUTES.
(a) In the event that any claim, dispute or controversy
("Dispute") arises between the parties regarding the performance,
interpretation, application or enforcement of this Agreement, including, but not
limited to, any action in contract or tort, at equity or at law, the chief
executive officers of the parties shall through informal, good faith
negotiations attempt to resolve the Dispute. Upon failure of the parties to so
resolve the dispute within ten (10) business days following receipt by one party
from the other of written notice of the Dispute, which notice shall refer to
this Section 10.10, the Dispute shall be referred to mediation.
(b) In the event a Dispute is referred to mediation, the
parties shall select a mediator within ten (10) business days of the termination
of their good faith negotiations. The mediator shall have the duty to submit a
possible resolution of the dispute to the parties, which will consider it in
good faith. The mediation shall be commenced within ten (10) business days of
the selection of the mediator and shall be concluded within twenty (20) business
days of such commencement.
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(c) Should any Dispute remain after the earlier of (i)
completion of the twostep resolution process set forth above or (ii) forty-five
(45) business days of receipt by one party from the other of the written notice
of the Dispute referred to in subsection 10.10(a) above, the Dispute may, if the
parties mutually agree in writing, be resolved by binding arbitration. Should
the parties agree to binding arbitration, such arbitration shall be conducted in
such manner, following such procedures, with such arbitrators and at such
location as the parties may mutually agree.
(d) Any litigation initiated by ATML against FVC must be
initiated by ATML in a state or a federal court in the city of San Jose, Santa
Clara County, California, USA. Amy litigation initiated by FVC against ATML must
be initiated in The High Court of Justice, Chancery Division, London, England,
UK. The parties hereby agree to the exercise of jurisdiction over them by such
tribunals.
(e) In the event either litigation and/or binding
arbitration is initiated, the prevailing party in the litigation and/or
arbitration shall be entitled to its reasonable attorney's fees and costs in
addition to any other relief to which that party may be entitled.
(f) Any deadlines in this Section 10.10 may be extended only
with the mutual written consent of the parties.
(g) The provisions of this Section 10.10 shall not preclude
either party from seeking immediate injunction relief in the event of breach of
Article 6 by the other party.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
FIRST VIRTUAL CORPORATION
By: /s/ RALPH UNGERMANN
Title: CEO
ADVANCED TELECOMMUNICATIONS
MODULES LIMITED
By: /s/ HERMANN HAUSER
Title: Chairman
24/2/94
Exhibits
A - Technology to be Licensed per Royalty Schedule
B - Joint Development Program
C - Procured Products
D - Olivetti Agreement
E - Olivetti Letter
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ATM Ltd. Exhibits for ATM and FVC Agreement
Exhibit A
EXISTING TECHNOLOGY TO BE LICENSED PER ROYALTY SCHEDULE
To be mutually updated quarterly
ATM's existing technology
1 Desk mounting 4 Port ATM switches
2 Desk or rack mounting 8 port ATM switches
3 Active switch backplanes using slotted access
4 Bidirectional co-axial cable to monomode and multimode dual fiber
converters
5 ATMOS card - general purpose computer with built-in ATM interface
6 PC compatible ATM network adapter
7 PC compatible ARM powered ATM network adapter
8 DEC TurboChannel ATM network adapter
9 ATM Camera - multiple input camera module with ATM interface
10 ATM Audio - 4 channel audio card, A/D & D/A with DSP & ATM interface
11 Disc Brick - self-contained file server with RAID, NFS and ATM interface
12 ATM Serial - 8 line serial (RS232) adapter with ATM network interface
13 ATM Ethernet and SCSI - ATM0S card adapter with Ethernet and SCSI
interfaces
14 CAP 16 UTP transceiver prototype card
15 25.6 Mbit UTP transceiver prototype card
16 DS3/E3 45/34 Mbps ATM ATMOS card adapter
17 ATOM chip design and VLSI specification incorporating ARM processor
core, memory, DMA logic, I/O ports and ATM network interfaces
18 BootROM image development environment incorporating hardware self-test
19 ATMos development system with software cross tools for UNIX
20 ATMos kernel with ATM code, library, SAR and switching
21 Basic self-routing server in network topology self determination
22 ATMos filing system software
FVC's existing technology
1 None
Page 1 of 4
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ATM Ltd. Exhibits for ATM and FVC Agreement
EXHIBIT B
JOINT DEVELOPMENT PROGRAMME
To be mutually updated quarterly
ATM will be responsible for:
1 Discrete version of ATOM Chip functionally software equivalent. Interim
solution pending ATOM Chip availability. Required to allow prototyping
and early product availability
2 ATOM chip implementation
3 Cost-reduced FPGA version of ATMOS card with DRAM
4 UTOPIA implimentations of transceivers
5 155 Mbps STP STS-3 (based on Saturn or Saturn Lite chips or similiar)
6 ATMos stand alone low-level manager code. Resides in at least one of the
switches in a system and provides booting etc services for the others
7 SSCOP protocol (stream protocol under Q93B)
8 Q93B/F signalling software implementation
9 Inband QoS software. Per-VCI loss priority and delay priority and BECN
handling
10 ILMI mangement hooks in ATMos basic ATM code
11 Specification of internal protocol between ATML-C9 and FVC-E2
12 Updates and upgrades (including cost reduction) to basic disk brick
hardware
13 NFS interface software
14 Real time transport (multimedia) protocol software API
15 Alternative API for value-add resident software
16 Office area switch based on existing ATML 4 port technology
17 Office area switch based on existing ATML 8 port technology
18 Various Hub configurations built from office area switch building blocks
and ATMos components. These switching modules should allow mixing and
matching of transceiver modules at the generic I/O ports so as to
flexibly meet customer demand.
Page 2 of 4
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ATM Ltd. Exhibits for ATM and FVC Agreement
EXHIBIT B. (continued)
FVC will be responsible for:
1 LAN Emulation protocol software (per ATM Forum) resident over signalling
layer
2 Host NDIS driver to ATM adapter
3 Host ODI driver to ATM adapter
4 Hub management software tie-in to existing LAN environments
5 Integration of management software into Synoptics and Cabletron
environments
6 Ethernet transparency module (Ethernet frames <-> ATM cells) for Adapter
7 Ethernet transparency module (Ethernet frames <-> ATM cells) for
Hub/Switch
8 ISA bus adapter based on existing ATML technology
9 EISA bus adapter based on existing ATML technology (if market need
exists)
10 PCI bus adapter based on existing ATML technology
11 Native ATM device driver to each of these adapters
12 Hub enclosures, power supply, backplane, mechanical specifications, form
factors
13 Basic 8/16/24 port switching hubs based on ATML's switching modules in
various configurations ie. mix of 25.6 Mb/s ports 100 Mb/s ports etc.
14 Interoperability with other switches eg. FORE, Synoptics etc
15 Hub management hardware module (may not be required in basic
configurations)
16 SNMP embedded agents with proxy to ILMI agents
17 Proprietary (enterprise-specific) MIB extensions
18 Interoperability with ATM management stations SNMP monitoring tools
19 Advanced "managing module" functionality as value-add module
20 SNMP 2 embedded agents (if market moves in this direction)
21 Value-add embedded agents (RMON gauges policy security)
22 UNIX management applications under HPOpenView
23 UNIX management applications under NV/6000 (if market need exists)
24 UNIX management applications under SunNet manager (if market need
exists)
25 Value-add management applications eg. integrated bandwidth management
Page 3 of 4
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ATM Ltd. Exhibits for ATM and FVC Agreement
EXHIBIT C
PROCURED PRODUCTS
To be mutually updated quarterly
1 ATOM chips
2 Transceiver chips
3 ATMos software kernel
Page 4 of 4
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Schedule 5
0093011003
LICENSE AND TECHNICAL CO-OPERATION AGREEMENT
FOR ATM TECHNOLOGY
THIS AGREEMENT is made on 3 Dec., 1993 ("Effective Date") by and between
(1) ING. C. OLIVETTI & C., S.p.A., whose registered office is at Via
Jervis 77, 10015 Ivrea, Italy ("Olivetti"), acting together with its
controlled company OLIVETTI RESEARCH LIMITED, whose registered office
is at 24A Trumpington Street, Cambridge CB2 1QA, England ("ORL"), and
(2) ADVANCED TELECOMMUNICATIONS MODULES LIMITED whose registered office is
at Home Farm, Fowlmere Road, Heydon, Nr Royston, Herts, SG8 8PZ ("the
Company")
RECITALS
(A) The Asynchronous Transfer Mode ("ATM") has recently become the
prevailing technological choice for high speed communication in
telephony and for computer local area networks.
(B) Olivetti through its controlled company ORL has developed hardware and
software for use in connecting
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computers and telephony using the ATM technology, and owns extensive
know-how and technical knowledge in the field of ATM technology.
(C) The Company has been established to develop and market a range of
products and services using the ATM technology for home and office
use.
(D) Olivetti and the Company have agreed to co-operate in the development
of ATM technology on the terms of this Agreement.
(E) Olivetti and the other subscribers of the Company are parties to the
Subscription Agreement, as hereinafter defined.
NOW IT IS AGREED as follows:
1. Definitions
In this Agreement the following expressions bear the meanings set out below:
1.1 "ATM Technology" means the technology of the Asynchronous Transfer
Mode, a description of which is provided in Exhibit A attached hereto.
1.2 "ATMos" means the real time operating software on which the Company
intends to base its ATM Technology.
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1.3 "Licensed Technology" means the technical information available to ORL
on the Effective Date which pertains to the ATM Technology and which
is either
(i) fully owned by Olivetti or its Subsidiaries, or
(ii) licensed to Olivetti or its Subsidiaries and sub-licensable to
the Company hereunder without any further payment by Olivetti
to any third party.
1.4 "Licensed IPRs" means patents and patent applications (including
utility models but excluding registered or unregistered designs),
unpatented inventions, copyrights and topography rights which underly
the Licensed Technology and are
(i) fully owned by Olivetti or its Subsidiaries, or
(ii) licensed to Olivetti or its Subsidiaries and sub-licensable to
the Company hereunder without any further payment by Olivetti
to any third party.
1.5 "Subsidiary" of any party means any corporation or other business
entity now or hereafter controlled by such party, where "to control"
an entity means to own, directly or indirectly, the majority of the
shares or ownership quotas in such entity entitled to vote for the
election of the Board of Directors or other similar
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managing body, or otherwise to own a number of shares representing
the right to nominate the majority of the members of the Board of
Directors.
1.6 "Subscription Agreement" means the agreement dated November 30, 1993
among the Company, Olivetti and the other subscribers of the Company
regarding among other things subscription of the Company's shares.
1.7 "Option Exercise Date" means the date on which Olivetti exercises the
Option defined in Section 8(1) of the Subscription Agreement.
2. Licence Grant
2.1 In consideration of the rights granted to Olivetti by Company pursuant
to the Subscription Agreement and Section 3.2 and of other
consideration the receipt of which Olivetti hereby grants to the
Company a non exclusive, worldwide licence to use, make, have made,
sell, lease and otherwise exploit without limitation (including the
grant of sub-licences) and without limit in time any hardware and/or
software product based upon the Licensed Technology and the Licensed
IPRs.
2.2 Olivetti will cause ORL to transmit, and ORL will transmit, promptly
upon execution of this Agreement, the Licensed Technology to the
Company in the form in which it is currently available to ORL.
2.3 Olivetti retains the right to make, have made, use,
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sell, lease and otherwise exploit including the grant of licenses to
Olivetti's Affiliates) equipment based on the Licensed Technology and
the Licensed IPRs as an integral part of Olivetti's products.
Notwithstanding the foregoing, Olivetti and its Affiliates shall not
exercise the right to make or have made equipment based upon the
Licensed Technology and the Licensed IPRs as long as the Company fills
the requirements of Olivetti and Olivetti's Affiliates for such
equipment in accordance with Olivetti's specifications, quality,
delivery time and other material purchasing terms and conditions and
is competitive with any other external or internal source available to
Olivetti for such equipment.
3. The Co-operation
3.1 During the term of this Agreement, Olivetti will cause ORL to
co-operate, and ORL will co-operate, with the Company by assisting it
upon the latter's request in the development of the ATM Technology.
The costs incurred by ORL for such assistance shall be charged to the
Company on a monthly basis. Reciprocally, in the event that Olivetti
requests, pursuant to a written purchase order, any support from the
Company, Olivetti will pay for the costs of such assistance on a
monthly basis.
3.2 Subject to the second sentence of Section 2.3, each party hereby
grants to the other party, for itself and
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its Subsidiaries, a non-exclusive, worldwide, royalty-free licence to
use (and to sub-licence) on the respective products without limit in
time any improvement made by such party to the Licensed Technology and
the Licensed IPRs prior to the Option Exercise Date.
4. Infringement of Rights
4.1 In the event that either Olivetti or the Company becomes aware of or
suspects any infringement problem relating to the products of the
Company, then the party so discovering or suspecting infringement
shall inform the other party and cooperate at Company's expense in
studying possible resolutions of the problem.
5. Disclaimer of Warranties
5.1 The Licensed Technology transmitted to the Company hereunder is
furnished "as is" and neither Olivetti nor ORL makes any warranties,
expressely or impliedly, written or oral, statutory or otherwise, with
respect thereto.
By way of example but not of limitation, neither Olivetti nor ORL
makes any representation or warranty as to merchantability, fitness
for purpose, absence of errors or defects, or absence of infringement
of third party intellectual property rights. The Company will
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indemnify Olivetti in connection with any claim made by any third
party alleging that any product or service of Company infringes any
IPR of a third party. In no event shall Olivetti or ORL be liable to
the Company for damages of any kind.
6. Duration
6.1 This Agreement shall continue in force until 31st December 1998 or
until the Option Exercise Date, whichever comes first. The licenses
granted by each party to the other party hereunder shall continue on a
fee-free basis after expiration hereof.
7. Termination
7.1 This agreement may be terminated by Olivetti by written notice to the
Company in case of a material default of the payment obligations
hereunder or of any other material obligations of Company hereunder,
if such breach is not cured within sixty (60) days after Olivetti's
written notice of default to the Company. Either party shall have the
right to terminate this Agreement if the other has a receiver or
administrative receiver over the whole or any part of its assets or if
an order is made or a resolution passed for winding up of the other
party or if the other party shall enter into a voluntary arrangement
with its creditors or suffer an administration order to be made
against it
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but termination shall not affect any rights granted to that other
party hereunder which are either expressly or by implication
irrevocable.
8. Notices
8.1 All notices or other communications which are required to be given
hereunder shall be in writing and shall be sent to the address of the
recipient set out in this Agreement or such other address and/or for
the attention of such other person as the recipient may designate by
notice given in accordance with the provisions of this clause. Any
such notice or communication may be delivered personally or sent by
first class prepaid registration letter or by facsimile transmission
and shall be deemed to have been served if by personal delivery when
delivered, if by first class post 48 hours after posting and if by
facsimile transmission at the time of despatch. If a notice or other
communication shall otherwise become effective on a day which is not a
business day such notice or other communication shall become effective
at 9.00am GMT upon the next following business day.
9. Law
9.1 This Agreement shall be governed by and construed in all respects in
accordance with English law and the parties hereto irrevocably submit
to the exclusive jurisdiction
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35
of the English Courts.
10. Invalidity
10.1 If any term or provision in this Agreement shall in whole or in part
be held to any extent to be illegal or unenforceable under any
enactment or rule of law that term or provision or part shall to that
extent be deemed not to form part of this Agreement and the
enforceability of the remainder of this Agreement shall not be
affected.
11. Assignment
11.1 None of the rights and obligations of the parties under this Agreement
shall be capable of assignment without the prior written consent of
each of the parties hereto to such assignment and provided that if
such consent is given such assignee shall be first obliged to adhere
to the terms of this Agreement as though an original party hereto in
place of the assignor. For the avoidance of doubt any permitted
transfer as aforesaid shall not in the absence of such prior written
consent result in any transfer of rights or obligations hereunder.
Any person bound to adhere to the terms of this Agreement shall be
required by the parties hereto to execute such deed of adherence or
other deed as shall be requisite.
IN WITNESS WHEREOF the parties have executed this Agreement
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36
as a Deed on the date first set out above.
Executed and delivered as a deed
by ING. C. OLIVETTI & C., S.P.A
in the presence of:
_______________________________
_______________________________
Executed and delivered as a deed
by OLIVETTI RESEARCH LIMITED
in the presence of:
_______________________________
_______________________________
Executed and delivered as a deed
by ADVANCED TELECOMMUNICATIONS
MODULES LIMITED
in the presence of:
_______________________________
_______________________________
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37
Exhibit A
Hardware
ATMos card
ATMos RAM card
4x4 switch
8x8 switch
backplane
twin line card
AToMic extender card
AToMic to XSI bus adapter
ATMos audio card
ATMos audio backplane
ATMos camera card set
X51 5-slot backplane
Coax/fibre converter
Archimedes ATM podule
ISA bus ATM card
IPA board
X$1 ATM interface
XSI midi interface
R3DAM board
Software
ATMos source and support tools
kernel
libraries
device drivers
device handler processes
bootstrapROM code
ARM assembler
linker
system build tools
ATMos documentation
4x4 switch code
8x8 switch code
Unix-hosted boot server code
38
First Virtual Corporation
3233 Octavious Drive
Suite B
Santa Clara, CA 96054
U.S.A.
Advanced Telecommunications
Modules Limited
Home Farm
Fowlmere Road
Heydon, Nr. Royston, Herts
SG8 8PZ England
February 18th, 1994
Gentlemen,
We refer to the Development and License Agreement (the "Agreement") currently
being finalized between First Virtual Corporation ("FVC") and Advanced
Telecommunications Modules Limited ("ATML").
The license granted by ATML to FVC under Section 3.1(a) of the Agreement
includes a sublicense of certain Olivetti Technology (as defined in the
Agreement) licensed by Ing. C. Olivetti & C., S.p.A. ("Olivetti") to ATML under
the Olivetti License (as defined in the Agreement). You have expressed
concerns that in the event of a termination of the Olivetti License, also the
sublicense granted by ATML to FVC would terminate.
We hereby agree that in the unlikely event of termination of the Olivetti
License, Olivetti shall, automatically and without further action necessary by
either Olivetti or FVC, grant a perpetual license to the Olivetti Technology
directly to FVC under the same terms and conditions as the sublicense to the
Olivetti Technology granted by ATML to FVC under the Agreement.
1.
39
In such an event, all the parties agree that FVC's obligations to Olivetti under
such license will supersede FVC's obligations to ATML with respect to the
Olivetti Technology under the Agreement, and that any royalty obligations of FVC
to Olivetti under such license and to ATML under the Agreement will be
apportioned between Olivetti and ATML in the proportion [ * ], so that FVC's
combined royalty obligations to Olivetti and ATML shall not exceed FVC's royalty
obligations to ATML under the Agreement.
We ask you to sign and return the enclosed copy of this letter to confirm your
acceptance of the foregoing.
Very truly yours,
Ing. C. Olivetti & C., S.p.A.
/s/
--------------------------------------
Agreed:
First Virtual Corporation
/s/
- ------------------------------------
Advanced Technology Modules Limited
/s/
- -------------------------------------
[*]=CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
2.
40
0095003003
AMENDMENT NO. 1
TO DEVELOPMENT AND LICENSE AGREEMENT
This Amendment No. 1 is entered into as of the 3rd day of March, 1995 by and
between First Virtual Corporation ("FVC"), a California corporation, and
Advanced Telecommunications Modules Limited ("ATML"), a corporation organized
under the laws of England.
RECITALS
WHEREAS, FVC and ATML are parties to a Development and License Agreement dated
25th February 1994 (the "Agreement") providing for the grant of certain licenses
by either party to the other party under the respective technologies and for the
joint development of certain products; and
WHEREAS, the parties wish to restructure their business relation with the aim to
complementing and enhancing their respective strengths, avoiding duplications
and speeding up the respective activities, while at the same time:
(a) maintaining the separate corporate image and identity of the two
parties;
(b) giving each party the full freedom to conduct its business, including
without limitation establishing marketing strategies, building up sales
channels, entering into new alliances with third parties and making
agreements with anybody; and
(c) safeguarding the right of the parties to compete on the marketplace;
NOW, THEREFORE, the parties hereby agree to amend the Agreement as follows:
1. The addresses of ATML and FVC in the Headings of the Agreement are
changed as follows:
Advanced Telecommunications Modules Limited
Mount Pleasant House
2 Mount Pleasant
Huntingdon Road
Cambridge, CB3 OBL
United Kingdom
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41
First Virtual Corporation
3393 Octavius Drive
Santa Clara, CA 95054, U.S.A.
2. The end date of the Joint Development Program provided in Section 2 of
the Agreement is changed from the second anniversary of the Agreement to
February 25, 1995.
There shall be no further exchange of technology beyond the technology
already received by the parties from each other as of February 25, 1995.
All technology obtained by the parties from each other prior to February
25, 1995, other than ATML's ATMos Software Kernel, as defined in
paragraph 4(b) below, shall be considered ATML's ATM Technology or
jointly Developed Technology, as appropriate, under the Agreement and
shall be subject to the licenses granted, and any restrictions thereto,
contained in Article 3 of the Agreement, as amended hereby.
3. The exclusivity granted by ATML to FVC under Section 3.1(b) of the
Agreement, as well as the provisions of Section 3.6 of the Agreement
titled "Dual Exclusivity", are hereby terminated as of February 25,
1995. All licenses granted by either party to the other party under the
Agreement shall continue after February 25, 1995 on a non-exclusive
basis, subject to the royalties set forth under Article 5 of the
Agreement.
4. (a) Each party shall make available for sale to the other party the
Procured Products listed in Exhibit C attached to the Agreement, as well
as any other products that the Parties may agree to procure from each
other. Any Procured Products, as well as any other product the parties
may agree to procure from each other, will be sold at "most favored
nation pricing" as defined in paragraph 6 hereof, and in accordance with
such reasonable and reciprocal terms and conditions as the parties may
mutually agree.
(b) ATML hereby grants to FVC a perpetual, worldwide, non-exclusive,
non-sublicensable license, for the fees specified in paragraph 4(c)
below, to use, maintain and support ATML's ATMos Software Kernel, as
described in Section 1 of ATMos Document No. IV titled "The ATMos Core"
and authored by L. J. French of Olivetti Research Ltd. in December 1993
and subsequently delivered by ATML to FVC (the "ATMos Software Kernel"),
as Procured Product under the Agreement in conjunction with FVC's
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42
production, sale and distribution of Licensed Products under the
Agreement.
(c) The following fees, which ATML represents is its "most favored
nation pricing" for the ATMos Software Kernel, shall apply (with fees
expressed in United States dollars and years being calendar years):
[ * ]
(d) The provisions of Sections 5.2 and 5.3 and Articles 6 through 10
of the Agreement shall apply to the license of the ATMos Software Kernel
by ATML to FVC under this paragraph 4, as if set forth in full herein.
(e) FVC will offer to ATML for distribution and resale its Media
Operating System (MOS) software product line, as commercially available
from time to time during the term of this Agreement, at "most favored
nation pricing" under paragraph 6 hereof and upon FVC's standard terms
and conditions for United States and for international distributors of
its MOS software product line, as appropriate.
5. ATML hereby waives any royalty which would be due to it by FVC pursuant
to Article 5 of the Agreement with respect to Licensed Products sold by
FVC prior to May 1st, 1996.
6. The term "most favored nation pricing" set forth under Section 4.2 of
the Agreement and paragraph 4 hereof is hereby defined to mean that the
prices charged by the selling party to the purchasing party for a
product shall be no higher than those charged by the selling party to
any third party for the same or any substantially similar product in
similar quantities and under commercially equivalent terms and
conditions.
7. The Agreement shall expire as of August 25, 1996 unless extended by
mutual agreement in writing, except that the licenses granted by each
party to the other party under Article 3 of the Agreement (as amended
hereby) shall survive such expiration perpetually and the royalty
[*] = CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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43
obligations set forth under Article 5 of the Agreement shall survive
until January 3, 2000 (which is five years from the date of FVC's first
commercial shipment of a Licensed Product). Any transaction between the
parties after February 25, 1995 will be at arms' length.
8. This Amendment becomes effective upon execution by the parties. Except
as amended hereby, the Agreement remains in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as of the
date first above written.
FIRST VIRTUAL CORPORATION ADVANCED TELECOMMUNICATION
MODULES LIMITED
By: /s/ Ralph K. Ungermann By: /s/ Hermann Hauser
Name: Ralph K. Ungermann Name: Hermann Hauser
Title: Chief Executive Officer Title: Chairman
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