EXHIBIT 10.10
NONEXCLUSIVE TECHNOLOGY LICENSE AGREEMENT
This Agreement, dated as of April 30, 1997, is made and entered into by and
between Notify Corporation, a California corporation ("Licensee") and Active
Voice Corporation, a Washington corporation ("AV"). Licensee and AV are
sometimes referred to herein collectively as the "Parties" and each individually
as a "Party."
The Parties agree as follows:
SECTION 1. DEFINITIONS.
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Whenever used in this Agreement with initial letters capitalized, the
following terms will have the following specified meanings:
1.1 "Affiliate" means any Person that controls, is controlled by, or is
under common control with a Party. In the case of a corporation, a Person will
be deemed to control that corporation if such Person owns, or has the right to
vote, stock in the corporation sufficient to elect a majority of the members of
the corporation's board of directors. In the case of a partnership, a Person
will be deemed to control that partnership if such Person owns, or has the right
to control the Person owning, a majority interest of general partner or
ownership interests in such partnership.
1.2 "Confidential Information" means any type of information or material
of Discloser which is disclosed to the Recipient as a consequence of or through
its participation in the activities anticipated by this Agreement, which is not
generally known to the public and which the Recipient knows or has reason to
know is confidential or proprietary. Confidential Information includes, without
limitation, information which relates to research, development, trade secrets,
know-how, inventions, source codes, technical data, software programming,
concepts, designs, procedures, manufacturing, purchasing, accounting,
engineering, marketing, merchandising, selling, business plans or strategies,
and information entrusted to Discloser by a Third Party. However, Confidential
Information does not include any information which:
(a) was in the Recipient's possession before receipt from the
Discloser;
(b) is or becomes a matter of public knowledge through no fault of
Recipient;
(c) is rightfully received by Recipient from a Third Party without a
duty of confidentiality;
(d) is independently developed by Recipient;
(e) is required to be disclosed by applicable law or legal process,
provided that Recipient gives Discloser reasonable advance notice of any such
required disclosure; or
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(f) is disclosed by Recipient with the Discloser's prior written
approval.
In any dispute over whether information is Confidential Information for purposes
of enforcement of this Agreement, it will be the burden of the Recipient to show
that such contested information is not proprietary or confidential, or does not
constitute a "trade secret" as that term is defined under applicable state law.
1.3 "Develop" (or such conjugation thereof as the context may require)
means design, engineer, invent or develop (or such conjugation thereof as the
context may require).
1.4 "Discloser" means the Party whose Confidential Information is
disclosed to the other Party.
1.5 "Distribute" (or such conjugation thereof as the context may
require) means sell, rent, lease, license, transfer or distribute (or such
conjugation thereof as the context may require) anywhere in the world.
1.6 "License" means the license granted under Section 2.
1.7 "Licensed Product" means any equipment, subassembly, component,
part, device or other product that uses or incorporates all or any part of the
Licensed Technology.
1.8 "Licensed Technology" means all inventions, patent rights,
copyrights, trade secrets, know-how, designs, plans, drawings, software,
operating prototypes and technical descriptions relating to the inventions
described under the Patent Rights to the extent that such are proprietary to AV.
1.9 "Make" (or such conjugation thereof as the context may require)
means manufacture, assemble, produce, reproduce or make (or such conjugation
thereof as the context may require).
1.10 "Month" means a calendar month.
1.11 "Patent" means United States Patent number 5,327,493;
1.12 "Patent Rights" means:
(a) the Patent;
(b) any reissues, divisions, renewals, extensions and
continuations of any of the patent claims described in the Patent; and
(c) any foreign patents that may issue on any of the patent claims
described in the Patent.
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1.13 "Person" means any individual, corporation, partnership, trust,
association or other entity.
1.14 "Quarter" means a calendar quarter (i.e., any consecutive period of
three consecutive months commencing with January, April, July or October).
1.15 "Recipient" means the Party to whom Confidential Information of the
other Party is disclosed as a consequence of or through its participation in the
activities anticipated by this Agreement.
1.16 "Term" means the term of this Agreement as set forth in Section 5.
1.17 "Third Party" means any Person that is not a Party or an Affiliate
of a Party.
1.18 "Year" means a calendar year.
SECTION 2. THE LICENSE.
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2.0 Grant. Subject to the terms and conditions set forth in this
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Agreement, AV hereby grants to Licensee a worldwide, irrevocable (except as
provided in Section 5), nonexclusive, license to Develop, Make, Distribute and
use Licensed Products during the Term.
2.1 Rights to Sublicense. The License includes the rights to grant
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sublicenses, with or without the right to grant subsequent sublicenses, to any
Third Party to Make any Licensed Product for Distribution by or through
Licensee.
The License does not include the right to, and Licensee will not, grant any
other sublicense under the License.
2.3 Patent Notice. Licensee shall mark each of the Licensed Products
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with the statement "Licensed by Active Voice Corporation under U.S. Patent
5,327,493." However, if it is infeasible to so mark each of the Licensed
Products, to the extent of such infeasibility, Licensee may provide for such
other notice on the Licensed Product, casing, or packaging (in descending order
of preference) as is sufficient to provide notice to the public under 35 USC
(S)287. In the event such notice is shortened in any way, the full notice shall
also be provided in the end user documentation for the final product containing
the Licensed Product.
SECTION 3. ROYALTIES.
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3.1 Amount.
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(a) License Fee. Licensee will pay AV a License Fee of *** due
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upon 180 days of this Agreement. Licensee shall also pay the unit royalty
provided below.
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* 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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(b) Unit Royalty. Licensee will pay AV royalties equal to *** for
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each unit of Licensed Product Distributed by Licensee or any Affiliate.
3.2 Payment. Within thirty (30) days after the end of each Quarter,
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Licensee will pay AV the royalties payable pursuant to paragraph 3.1 with
respect to any and all Licensed Products Distributed during such Quarter. Such
royalties will be paid at the notice address specified for AV in this Agreement
or in accordance with such other instructions as AV may give Licensee in
writing. Licensee will submit or cause to be submitted with each royalty
payment made hereunder a statement setting forth the calculation of the
royalties due hereunder. Any royalties, license fees or other amounts not paid
when due will accrue interest at the rate of one percent (1.0%) per month or the
highest rate permitted by applicable usury law, whichever is less, from the date
due until the date paid.
3.3 Accounting and Records. Licensee will (and will obligate its
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Affiliates to) keep and maintain current, complete and accurate books and
records regarding factors taken into account in the determination of royalties
under this Agreement. Without limitation, such records shall show the worldwide
disposition of every unit manufactured (ASIC, subassembly or final assembly)
including those not Distributed (e.g. those used for testing or scrap). Upon
AV's request, Licensee will (and will cause its Affiliates to) provide access to
such records for examination and audit by AV. Any such examination,
reproduction and audit will be conducted at such times and in such a manner so
as not to reasonably interfere with the normal business operations of Licensee
or its Affiliates. If any such audit discloses an understatement of royalties
payable, Licensee will immediately pay to AV the deficiency plus interest as
provided for above. If the deficiency for any Quarter is in excess of three
percent (3%) of the royalties properly payable for such Quarter, then Licensee
or its Affiliates being audited will reimburse AV for all reasonable costs
incurred by AV to conduct the audit.
SECTION 4. WARRANTIES.
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The parties warrant to each other that each has the right to enter into
this Agreement with the other. AV specifically warrants that it owns U.S.
Patent number 5,327,493 and that it is not aware of any claim, action or
proceeding, pending or threatened, that alleges any infringement of any Third
Party patents by any Person who is Making, Selling, Distributing or using the
Patent Rights.
THE WARRANTY SET FORTH IN PARAGRAPH 4 IS EXCLUSIVE AND IN LIEU OF ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, OF AV. WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, AV DISCLAIMS ANY AND ALL WARRANTIES, EXPRESS OR IMPLIED, WITH REGARD
TO THE SCOPE, COVERAGE, VALIDITY OR ENFORCEABILITY OF ANY CLAIM UNDER ANY OF THE
PATENT RIGHTS AND ANY AND ALL WARRANTIES, EXPRESS OR IMPLIED, WITH REGARD TO ANY
LICENSED PRODUCT (INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY REGARDING
INFRINGEMENT OF ANY OTHER PATENT OR INTELLECTUAL PROPERTY RIGHT OF ANY THIRD
PARTY AND ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE).
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* 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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SECTION 5. TERM.
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5.1 General. The Term will commence on the date of this Agreement and
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will continue until the expiration of the Patent, unless sooner terminated
pursuant to paragraph 5.2, below.
5.2 Termination for Default by Licensee. If Licensee defaults in the
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payment of any royalties due to AV under this Agreement or materially breaches
this Agreement, AV may terminate this Agreement by giving Licensee written
notice of such termination, provided that:
(a) AV will not give such notice of termination prior to the
expiration of thirty (30) days after AV gives Licensee written notice specifying
the default or breach (including, but not necessarily limited to, the amount, if
known, which AV believes has not been paid when due) and AV's intention to
terminate the Term if the default is not cured within such thirty (30) day
period; and
(b) the termination will not be effective if Licensee cures the
default or breach prior to Licensee's receipt of AV's written notice of
termination given in accordance with this paragraph.
5.3 Effect of Termination. Upon any termination of the Term pursuant to
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paragraph 5.2, this Agreement will terminate and Licensee will have no further
License under this Agreement. All copies of an AV Confidential Information in
Licensee's possession or control shall be destroyed or returned to AV and
Licensee shall make no further use of such Confidential Information.
Termination shall not affect Licensee's obligations to pay royalties accruing
prior to the end of the Term.
SECTION 6. RESOLUTION OF DISPUTES.
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6.1 Policy. The Parties hope there will be no disputes arising out of
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their relationship. To that end, each commits to cooperate in good faith and to
deal fairly in performing their duties under this Agreement in order to
accomplish their mutual objectives and avoid disputes. But, if a dispute
arises, the Parties affirm their mutual commitment to resolve all disputes by
the following alternate dispute resolution process:
(a) the Parties agree to seek a fair and prompt negotiated
resolution; but if this is not successful;
(b) all disputes will be resolved by binding arbitration; provided
that during this process;
(c) at the request of either Party made not later than forty-five
(45) days after the initial arbitration demand, the Parties agree to attempt to
resolve any dispute by nonbinding third-party intervention including mediation
or evaluation or both (but without delaying the arbitration hearing date).
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The Parties confirm that by agreeing to this alternate dispute resolution
process, they intend to give up their right to have any dispute decided in court
by a judge or jury.
6.2 Binding Arbitration. Any claim between the Parties, including but not
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limited to those arising out of or relating to this Agreement and any claims
based on or arising from an alleged tort, will be determined by arbitration
commenced in accordance with RCW 7.04.060; provided that the total award by a
single arbitrator (as opposed to a majority of three arbitrators) will not
exceed $250,000. If either Party asserts in good faith that it is entitled to
an award over $250,000, there will be three arbitrators. If the Parties cannot
agree, then the arbitrator(s) will be selected by the administrator of the
American Arbitration Association (AAA) office in Seattle. Each arbitrator will
be an attorney with at least 15 years' experience in commercial law in the
Seattle metropolitan area, which will be the venue of the arbitration. Any
issue about whether a claim is covered by this Agreement will be determined by
the arbitrator(s).
6.3 Procedures. The arbitration will be conducted in accordance with this
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Agreement using as appropriate the AAA Commercial Arbitration Rules with
Expedited Procedures in effect on the date hereof. There will be no discovery
or dispositive motion practice except: the arbitrator(s) may consider a
preliminary motion to dismiss any claims allegedly barred by the preceding
subparagraph or any applicable statute of limitation; the arbitrator(s) will
authorize such discovery as may be shown to be necessary to ensure a fair
hearing, and no such discovery will extend the time limits contained herein.
The arbitrator(s) will not be bound by the rules of evidence or of civil
procedure, but rather may consider such writings and oral presentations as
reasonable businessmen would use in the conduct of their day-to-day affairs, and
may require the parties to submit some or all of their case by written
declaration or such other manner of presentation as the arbitrator(s) may
determine to be appropriate. The Parties intend to limit live testimony and
cross-examination to the extent necessary to ensure a fair hearing on material
issues.
6.4 Hearing - Law - Appeal Limited. The arbitrator(s) will take such
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steps as may be necessary to hold a private hearing within ninety (90) days of
the initial demand for arbitration and to conclude the hearing within two (2)
days; and the arbitrator(s)'s written decision will be made not later than
fourteen (14) calendar days after the hearing. The Parties have included these
time limits in order to expedite the proceeding, but they are not
jurisdictional, and the arbitrator(s) may for good cause afford or permit
reasonable extensions or delays, which will not affect the validity of the
award. The written derision will contain a brief statement of the claim(s)
determined and the award made on each claim. In making the decision and award,
the arbitrator(s) will apply applicable substantive law. Absent fraud,
collusion or willful misconduct by an arbitrator, the award will be final, and
judgment may be entered in any court having jurisdiction thereof. The
arbitrator(s) may award injunctive relief or any other remedy available from a
judge, including the joinder of parties or consolidation of this arbitration
with any other involving common issues of law or fact or which may promote
judicial economy, and may award attorneys' fees and costs to the prevailing
party but will not have the power to award punitive or exemplary damages. The
decision and award of the arbitrators need not be unanimous; rather, the
decision and award of two arbitrators will be final.
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6.5 Injunctive Relief. Either Party may seek preliminary or interim
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injunctive relief from any court having jurisdiction in the event of a breach of
this Agreement. By obtaining any such remedy such party will not waive the
provisions of subparagraphs 6.1 through 6.4 above; and any issues or claims
which arise in connection with such injunctive relief may be determined by
arbitration in accordance with subparagraphs 6.1 through 6.4 above.
SECTION 7. MISCELLANEOUS.
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7.1 Nondisclosure of Confidential Information. Each Party will exercise
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the same degree of care, but no less than a reasonable degree of care, to keep
confidential the Confidential Information of the other Party as it uses to
protect its own Confidential Information of a like nature. If the Recipient is
served with any subpoena or other compulsory judicial or administrative process
calling for production of Confidential Information, the Recipient will
immediately notify the Discloser in order that it may take such action as it
deems necessary to protect its interest.
Licensee acknowledges that the terms and conditions of this Agreement,
including without limitation the royalty provisions, are AV Confidential
Information.
7.2 Notices. Unless otherwise provided, any notice required or permitted
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under this Agreement will be given in writing and will be deemed effectively
given upon personal delivery to the party to be notified or upon deposit with
the United States Post Office, postage prepaid, registered or certified with
return receipt requested and addressed to the party to be notified at the
address indicated for such party below:
If to Licensee: Notify Corporation
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1054 S. DeAnza Blvd., Suite 105
San Jose, CA 95129
Attn: Paul DePond, President
If to AV: Active Voice Corporation
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2901 Third Avenue #500
Seattle, WA 98121-9800
Attn: CFO and General Counsel
Either Party may change its address specified in this paragraph by giving the
other party notice of such change in accordance with this paragraph.
7.3 Amendments; Waiver. Any amendment of this Agreement will be set forth
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in writing and signed by both parties. The failure of either Party to insist
upon or enforce strict performance by the other of any Of the provisions of this
Agreement, or to exercise any right or remedy under this Agreement, will not be
construed as a waiver or relinquishment to any extent of such party's right to
assert or rely upon any such provisions, rights or remedies in that of any other
instance; rather, the same will be and remain in full force and effect.
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7.4 No Partnership, Franchise or Agency. This Agreement will not be
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interpreted or construed to create any partnership, franchise or agency
relationship between the Parties or to impose any partnership, franchise or
agency obligation or liability upon either Party. Without limiting the
generality of the foregoing, neither Party will have, by virtue of this
Agreement, any right, power or authority to act as the agent of, enter into any
contract, make any representation or warranty, or incur any obligation or
liability of the other Party.
7.5 Successors and Assigns. The rights and licenses granted by AV in this
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Agreement are personal to Licensee and may not be assigned or otherwise
transferred without the written consent of AV. Any attempted assignment or
transfer without such consent shall be void and shall automatically terminate
all rights of Licensee under this Agreement. Notwithstanding the above, AV will
not unreasonably withhold its consent in the event Licensee is transferring its
entire business to the proposed assignee. Subject to the foregoing, this
Agreement will be binding upon, inure to the benefit of, and be enforceable by
each of the Parties and their respective successors and assigns.
7.6 Counterparts. This Agreement may be executed in two or more
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counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
7.7 Expenses; Attorneys' Fees. If any action at law or in equity is
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necessary to enforce or interpret the terms of this Agreement, the prevailing
Party will be entitled to reasonable attorney's fees, costs and necessary
disbursements in addition to any other relief to which such Party may be
entitled.
7.8 Severability. The invalidity of all or any part of any section of
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this Agreement shall not render invalid the remainder of this Agreement or the
remainder of such section. If any provision of this Agreement is so broad as to
be unenforceable, such provision shall be construed, by limiting and reducing
it, so as to be enforceable to the extent compatible, with the applicable law as
it shall then appear.
7.9 Governing Law. This Agreement will be governed and construed in
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accordance with the laws of the State of Washington as applied to agreements
among Washington residents entered into and to be performed entirely within the
State of Washington.
7.10 Entire Agreement. This Agreement constitutes the full and entire
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understanding and agreement between the Parties with respect to the subject
matter hereof and supersede all prior agreements with respect to the subject
matter hereof and thereof.
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In witness whereof the Parties have duly entered into this Agreement as of
the date first written above.
Licensee: Notify Corporation
By: ________________________________
Its: _______________________________
AV: Active Voice Corporation
By: ________________________________
Its: _______________________________
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