Exhibit 10
LICENSE, DEVELOPMENT AND MARKETING AGREEMENT
This LICENSE, DEVELOPMENT AND MARKETING AGREEMENT (the "Agreement") is entered
into and effective as of May 9, 1997 (the "Effective Date"), by and between
MICROSOFT CORPORATION, a Washington corporation (hereinafter "Microsoft"), and
CITRIX SYSTEMS, INC., a Delaware Corporation (hereinafter "Citrix").
RECITALS
A. Microsoft and Citrix desire to work together as provided in this Agreement
to develop multi-user functionality for Microsoft's Windows NT Server
operating system which will be owned and marketed by Microsoft;
B. Microsoft desires to license from Citrix a subset of Citrix' existing
multi-user software enhancements to Microsoft's Windows NT Server, as
provided in this Agreement;
C. Microsoft desires to cooperate with Citrix as provided in this Agreement in
the development of plug-ins and other complementary product offerings; and
D. Microsoft and Citrix desire to engage in joint marketing to promote use of
Windows NT Server-based multi-user software and Citrix' ICA, as provided in
this Agreement.
AGREEMENT
1 Definitions
1.1 "Citrix Deliverables" shall mean the information and materials
described in Exhibit A.
1.2 "Clone Product" shall mean either party's product designed, developed
or acquired after the Effective Date that competes with and is a fully
compatible look-alike or act-alike (by providing the same or
substantially the same user interface and/or APIs) version of an
Established Product of the other Party. An Established Product is a
product publicly released or released for significant public beta
testing, and designed, developed, or acquired before the introduction
of the party's product; Clone Product shall exclude software, such as
drivers, network protocols, etc., where such similarity with the user
interface or APIs is dictated by adherence to an industry standard
which was widely recognized prior to the release of a party's product.
A party's product shall not be deemed to be a Clone Product solely on
the basis that it provides the same or substantially the same
functionality as a product of the other Party. For the purposes of
this definition, neither the ICA protocol nor Microsoft created
interfaces and protocols
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[CONFIDENTIAL TREATMENT REQUESTED]/*/ shall be deemed to be
[CONFIDENTIAL TREATMENT REQUESTED]/*/ . "Microsoft Windows Operating
System Products" shall mean Windows (and successors and derivatives),
Windows NT (and successors and derivatives), and Windows CE (and
successors and derivatives). The parties have utilized a definition of
"Clone Product" in Exhibit F which is different from the foregoing.
The definition in this Section shall apply to all of the provisions of
this Agreement other than Exhibit F.
1.3 "Hydrix" shall mean a Microsoft product offering or offerings based
upon or working in conjunction with Windows NT Server, which offering
or offerings provide Multi-User functionality (as defined below).
"Hydrix 4.0 and Hydrix 4.x" shall mean such product offerings which
are based on Windows NT Server versions 4.0 and 4.x, respectively, as
further described in Exhibit C, and "Hydrix 5.0 and Hydrix 5.x" shall
mean such product offerings which are based on Windows NT Server
versions 5.0 and 5.x, respectively, as further described in Exhibit D.
1.4 "Hydrix Plug-In Interface" shall mean the unique Hydrix Multi-User
subsystem plug-in interfaces developed by the parties hereunder as
further described in Exhibits C and D.
1.5 "ICA" shall mean Citrix' protocol currently known as Intelligent
Console Architecture.
1.6 "ICA Version of Internet Explorer" shall mean versions of Internet
Explorer, which are created in accordance with Section 4.3.1.
1.7 "Internet Explorer" shall mean versions 3.x and 4.x of the Microsoft
standalone web browser which is marketed under the name "Internet
Explorer."
1.8 "Invention" shall mean any idea, design, concept, technique,
invention, discovery or improvement, whether or not patentable.
1.9 "Key System" shall mean a system or mechanism enabling Hydrix servers
to manage access by and identify the type of clients which access such
servers.
1.10 "Key System Client Software" shall mean a client software component
that is to be included in Hydrix-based client programs to implement
the Key System released by Microsoft to Citrix during the term of this
Agreement. The purpose of this component is to ensure the proper
validation of Hydrix access. If the Key
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/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2
PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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System Client Software includes functionality beyond client type and
unique identifiers, ICA-based devices need not support this additional
functionality.
1.11 "Marketing Liaisons" shall mean the representatives of the parties
who are so identified pursuant to Section 7.
1.12 "Microsoft Deliverables" shall mean the information and materials
described in Exhibit B.
1.13 "Multi-User" shall mean a system in which a single server computer is
connected to one or more computer terminals (or personal computers
emulating terminals) which terminals only display the output of, and
gather input for, the applications running on the server computer. A
Multi-User configuration is distinguished from a networked
configuration in that the controlling application programs for the
users at terminals in a Multi-User configuration execute only on the
server and not on the computer terminals. The parties have utilized a
definition of "Multi-User" in Exhibit F which is different from the
foregoing. The definition in this Section shall apply to all of the
provisions of this Agreement other than Exhibit F.
1.14 "Object Code" shall mean machine-executable computer software code in
binary form.
1.15 "Named Executives" shall mean the representatives of the parties who
are so identified pursuant to Section 7.
1.16 "Net Receipts" shall mean royalties, fees and other amounts received
by Microsoft from the shipment, licensing, and other distribution of a
product, less reasonable adjustments for returns, rebates, freight
charges, and sales, use, value-added, and other applicable taxes,
provided that any returns or rebates are computed in accordance with
the last two sentences of Section 9.1.2.5 hereof.
1.17 "Plug-In Software" shall mean Windows NT Server-based server side
software, developed by Citrix or Microsoft that (i) implements Citrix
or Microsoft protocols, (ii) allows a remote client to execute
applications on the server as described in Section 1.13, and (iii)
utilizes the Hydrix Plug-In Interface.
1.18 "Pure ICA Device" shall mean a device comprising hardware and
software, whether now known or hereafter invented, that will
communicate with application servers using only ICA presentation
service protocols. Pure ICA Devices may have local execution of
applets that have been pre-installed or loaded by an administrator,
but shall not contain applets downloaded by an end user or offer any
other substantial functionality except via an ICA connection to an
application server. A device which meets the definition of a Pure ICA
device but which can be rebooted to run an alternative software
environment not meeting the definition of a Pure ICA Device shall
still be considered a Pure ICA Device when running solely as a Pure
ICA Device.
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1.19 "Source Code" shall mean commented program source code, header files,
resource files, bitmaps, icons, and help file source code for the
applicable software product.
1.20 "Technical Coordinators" shall mean the representatives of the
parties who are so identified pursuant to Section 7.
1.21 "Windows CE" shall mean the current Windows CE product offered by
Microsoft, or its equivalent and follow-on versions and derivative
works thereof.
1.22 "Windows Client Devices" shall mean computers and other electronic
devices, whether now known or hereafter developed, which use any
Microsoft Windows family operating system now known or hereafter
developed, including without limitation Microsoft Windows 3.x (whether
running alone or in conjunction with any other operating system (such
as MS-DOS or OS/2)), and derivatives and successors, Microsoft Windows
95 and derivatives and successors, Windows CE and derivatives and
successors, Windows NT Workstation and derivatives and successors, and
Windows NT Server and derivatives and successors. In no event,
however, shall "Windows Client Devices" include any computer or other
electronic device which uses an MS-DOS branded operating system
product or an OS/2 branded operating system product as its only
operating system.
1.23 "WinFrame" shall mean any version of the Citrix product currently
offered under the name "WinFrame." "WinFrame 2.0/3.51" shall mean any
WinFrame product which (i) is based on Windows NT Server v. 3.51 code;
and (ii) corresponds with the specifications existing as of the
Effective Date for WinFrame 2.0/4.0, but which is ported back to
Windows NT Server v.3.51, including any limitations which are
necessitated by such downgrade. "WinFrame 2.0/4.0" shall mean a
version of the WinFrame 2.0 product which is based on Windows NT
Server v.4.0 as such version exists or has been described in Citrix'
specifications as of the Effective Date.
2 Deliverables
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2.1 Citrix. Citrix shall deliver to Microsoft the Citrix Deliverables
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according to the schedule set forth in Exhibit A.
2.2 Microsoft. Microsoft shall deliver to Citrix the Microsoft
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Deliverables according to the schedule set forth in Exhibit B.
3 Work Scope
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3.1 Development of Hydrix. Microsoft and Citrix will work together to
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develop Hydrix 4.x and Hydrix 5.x (including the joint development of
Hydrix Plug-In Interfaces) in accordance with the architectural
specifications and development plans which are further described in
Exhibits C and D. The parties agree that Hydrix is to be a superset
of Windows NT Server, and will be made commercially available through
Microsoft's standard distribution channels. Both parties
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recognize that a goal of this Agreement is to reconcile the interfaces
for Citrix Plug-in Software and Microsoft Plug-in Software, but that
this goal may not be achieved with respect to Hydrix 4.0.
3.1.1 The Technical Coordinators (or their designees) are responsible
for all issues relating to staffing and assignments. Each party
shall pay its own employees' salaries and expenses.
3.1.2 Microsoft shall provide office space and appropriate computer
equipment to Citrix employees located in Redmond performing
work hereunder. Microsoft will allow Citrix engineers to have
unescorted access to its Redmond facility as is reasonable for
the purpose of performing work hereunder. Citrix engineers
shall abide by all rules and regulations pertaining to work at
Microsoft's campus.
3.2 Enhancements to Hydrix Plug-in Interface. Microsoft and Citrix will
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jointly architect and develop enhancements to the Hydrix Plug-In
Interface and system capabilities required to support the Hydrix Plug-
In Interface.
3.3 Procedure for Considering Enhancement Proposals by Either Party. Each
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party's development team may present proposals for possible
enhancements to Hydrix and to the Hydrix Plug-In Interface to the
development team of the other party. In selecting and implementing
any such enhancement, each party will use commercially reasonable good
faith efforts to take into account the strategic goals, reliability
requirements, and schedule constraints of the other. Should a
proposed enhancement be rejected by either development team the
proposing party may elect to escalate such proposal to the Technical
Coordinators and then the Named Executives; provided, however, that
Microsoft shall retain final authority over the Hydrix architecture,
including enhancements to the Hydrix Plug-In Interface. In making
such determinations, Microsoft agrees to evaluate possible
enhancements to the Hydrix Plug-In Interface in light of the following
mutual goals of the parties: (i) not disadvantaging Citrix Plug-In
Software vis-a-vis Microsoft Plug-In Software; (ii) ensuring that the
performance and scalability of Hydrix following the proposed
enhancement will not be materially worse than is provided by the
current Hydrix product offering, or, for the first Hydrix release,
than that provided by WinFrame 2.0/4.0; and (iii) ensuring that
enhancements do not cause Citrix Plug-In Software to materially
regress in terms of performance or functionality. The parties agree
that the foregoing goals may be overridden by Microsoft's need to
address market demand for enhancements to Hydrix which cause a minor
regression in the performance and functionality of Citrix Plug-In
Software, and which regression it is technically impracticable to
prevent within a commercially reasonable development schedule. If
after escalation, Microsoft rejects a proposed enhancement which
Citrix considers essential, Microsoft will cooperate with Citrix to
determine an alternative business and technical solution which will
allow Citrix to develop and distribute such enhancement with its Plug-
In
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Software. Neither party may charge any fee to the other party in
connection with cooperative efforts undertaken pursuant to the
foregoing sentence.
3.3.1 Citrix shall have the option of maintaining a reasonable
technical liaison staff at Microsoft for the purpose of
participating in the architecture and implementation of
enhancements to the Hydrix Plug-In Interface.
3.4 Support Documentation. Citrix will provide Microsoft on an ongoing
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basis with current technical and support documentation concerning
Citrix' Hydrix-related products, including but not limited to the
Citrix Plug-In Software, in order to enable Microsoft technical
support personnel to be able to identify errors or support issues
which are related to the Citrix Plug-In Software.
3.5 Support Responsibilities for Hydrix and Plug-In Software. Microsoft
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will provide initial end user support contacts and problem diagnosis
for all versions of Hydrix. Citrix will provide Microsoft with all
technical assistance and code modifications necessary to resolve end
user support requests from Hydrix 4.x end users which cannot be
addressed by Microsoft support personnel through reference to standard
product support materials. In providing such Hydrix technical support
to Microsoft, Citrix will comply with the response time requirements
set forth in Exhibit G. Any code modifications generated as part of
this effort shall be included in Hydrix service packs unless Microsoft
elects otherwise on a case-by-case basis. If Microsoft elects not to
include any such modification in Hydrix service packs, Microsoft will
make such modifications generally available through an alternative
distribution mechanism. Each party will provide all customer support
for its respective Plug-In Software. The parties will work in good
faith to design an infrastructure for referral and escalation of
Hydrix and Plug-In Software-related support requests, and amend
Exhibit G as appropriate.
3.6 Location of Work. Except as provided above and except as mutually
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agreed by the Technical Coordinators, the parties agree that all work
to be performed hereunder shall be performed at the facilities of the
party performing such work.
3.7 Marketing. The parties will make the announcements and conduct the
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joint marketing and promotions provided for in Exhibit E and as agreed
upon by the Technical Coordinators or Named Executives from time to
time.
3.8 Quarterly Reviews. Quarterly review meetings relating to the work to
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be performed hereunder will be held at either Microsoft or Citrix
within a reasonable time after the end of each calendar quarter. The
purpose of these meetings is for the Named Executives or their
designees to disclose relevant product strategies and plans to one
another, as appropriate, and to encourage a periodic exchange of views
by Microsoft and Citrix personnel having an interest in, and/or
responsibility for, the progress of the work to be performed
hereunder.
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3.9 Further Product Plans. Microsoft agrees to consider, in good faith, a
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plan for Microsoft to offer an entry-level Hydrix product that
incorporates the Hydrix Plug-In Interface, targeted at small business
and replicated sites with low-cost characteristics.
4 License Grants
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4.1 Citrix Deliverables. Citrix hereby grants to Microsoft, under Citrix'
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intellectual property rights (other than trademarks), the following
worldwide, nonexclusive, [CONFIDENTIAL TREATMENT REQUESTED]/*/ rights:
(i) to modify and create derivative works of the Citrix Deliverables
in Source Code form; (ii) to make, use, copy, import, distribute
(directly or indirectly), license, sell, offer to sell, rent or lease
the Citrix Deliverables (and derivative works thereof created under
clause (i) above) in Source and Object Code form; and (iii) to
sublicense any and all of the rights set forth in clauses (i) and (ii)
above to further third parties, including the right to sub-license
such rights to further third parties.
4.2 Key System Client Software. Microsoft hereby grants to Citrix, under
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Microsoft's intellectual property rights (other than trademarks), the
following world-wide, non-exclusive, [CONFIDENTIAL TREATMENT
REQUESTED]/*/, solely for incorporation into devices accessing the
Citrix Plug-In Software running on Windows NT Server: (i) to make,
use, copy, import, distribute (directly or indirectly), license, sell,
offer to sell, rent or lease the Key System Client Software in Object
Code form; (ii) to sub-license any and all of the foregoing rights to
further third parties, including the right to sub-license such rights
to further third parties, and (iii) to copy, modify, and create
derivative works of the Key System Client Software in Source Code form
for the sole purpose of porting such software to operating systems
other than those used with Windows Client Devices, provided, however,
that Citrix may not reduce the integrity of the Microsoft Key System
authentication logic and Citrix distributes the Key System Software
under terms and conditions which prohibit reverse engineering or any
other means to circumvent security or use of the software in an
unauthorized manner. Citrix has the right to use contractors or
consultants who have been approved in writing by Microsoft to perform
the porting described in paragraph (iii) above on Citrix' behalf,
subject to the terms and conditions of this Agreement. Microsoft
hereby agrees to consider in good faith any formal written Citrix
request to [CONFIDENTIAL TREATMENT REQUESTED]/*/ in conjunction with
distribution licenses to Citrix Plug-In Software or Citrix client
software in order for [CONFIDENTIAL TREATMENT REQUESTED]/*/ as
authorized therein, and make reasonable efforts to respond to such
requests within
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/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2
PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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[CONFIDENTIAL TREATMENT REQUESTED]/*/ days, and such
approval shall not be unreasonably withheld. If Microsoft does not
respond within these [CONFIDENTIAL TREATMENT REQUESTED]/*/ days, such
approval shall be deemed granted.
4.3 Internet Explorer.
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4.3.1 Microsoft hereby grants to Citrix, under Microsoft's
intellectual property rights (other than trademarks), a world-
wide, non-exclusive right during the term of this Agreement to
use, copy, modify, and create derivative works of Internet
Explorer in Source Code form for the sole purpose of improving
the performance of Internet Explorer as it relates to Hydrix
Plug-In Software, provided that such improvements do not change
the resulting version of Internet Explorer's external behavior
or end user interface.
4.3.2 Citrix shall test each ICA Version of Internet Explorer that it
develops in accordance with Microsoft's standard testing
procedures for final release products, and shall deliver each
ICA Version of Internet Explorer to Microsoft following
successful completion of such testing. Upon receipt of an ICA
Version of Internet Explorer that has passed such testing,
Microsoft shall have thirty (30) business days in which to
notify Citrix that it intends to distribute a Microsoft version
of Internet Explorer that incorporates the modifications made
by Citrix. If Microsoft does not so notify Citrix within the
foregoing thirty (30) day period, then Citrix may notify
Microsoft that Citrix desires to obtain a license to reproduce
and distribute such ICA Version of Internet Explorer in Object
Code form, which shall be on Microsoft's standard distribution
terms for this software [CONFIDENTIAL TREATMENT REQUESTED]/*/,
including without limitation any use by Citrix of the Internet
Explorer logo and the end user license under which Citrix would
distribute the applicable ICA Version of Internet Explorer.
4.3.3 [CONFIDENTIAL TREATMENT REQUESTED]/*/ If the parties cannot
agree upon a suitable payment, after good faith efforts, within
ninety (90) days of the start of negotiations, any reproduction
and distribution rights granted to Citrix for an ICA Version of
Internet Explorer shall terminate automatically.
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/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2
PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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4.4 Windows NT Server and Hydrix Source Code. Microsoft hereby grants to
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Citrix, under Microsoft's intellectual property rights (other than
trademarks), a world-wide, non-exclusive, [CONFIDENTIAL TREATMENT
REQUESTED]/* /license during the term of this Agreement to: (i) use
and copy the Windows NT Server Source Code and Hydrix Server Source
Code delivered by Microsoft to Citrix hereunder, in read only format,
as a reference in the design or development of Plug-In Software, and
(ii) use, copy, and create derivative works of the Windows NT Server
Source Code and Hydrix Server Source Code delivered by Microsoft to
Citrix hereunder in support of the joint development of the Hydrix
Plug-In Interfaces as described in Section 3.2 and the development of
proposed design enhancements to the base Hydrix Multi-User
functionality as described in Section 3.3.
4.5 Source Code Rights. Subject to Section 10.3, the term of the license
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agreement between Citrix and Microsoft dated November 15, 1989
(Contract No. 5198-9228), as amended, shall be extended until
September 30, 2001 for Windows NT Server version 3.5 1.
4.6 Additional Tools. In the event Microsoft or Citrix develops or
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acquires any software tools which would assist the other party in
performing its development and testing responsibilities under this
Agreement in a timely manner, Microsoft or Citrix shall consider in
good faith the possibility of licensing such tools to the other party
without charge for use by that party's employees and consultants in
performing their obligations under this Agreement. Any such licenses
may be contingent, among other things, upon entry into further written
license agreements governing the applicable tools and complying with
all applicable license restrictions.
4.7 Drivers and Header Files of Citrix' WinFrame 1.6 and WinFrame 2.0/4.0.
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With respect to Windows NT video device drivers and header files that
are presently incorporated into WinFrame 1.6 or WinFrame 2.0/4.0 and
for which there are reasonable equivalents in generally available
Microsoft software development kits ("Incorporated Files"), and for
Microsoft-developed and owned sample device driver code and header
files available in standard Microsoft device driver kits ("Device
Drivers/Headers"), Microsoft hereby grants to Citrix, under
Microsoft's intellectual property rights (other than trademarks), the
following world-wide, non-exclusive, perpetual, irrevocable,
[CONFIDENTIAL TREATMENT REQUESTED]/*/ rights: (i) to make, use, copy,
import, distribute (directly or indirectly), license, sell, offer to
sell, rent or lease Incorporated Files and Device Drivers/Headers, in
Object Code form, solely for incorporation into Plug-In
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/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2
PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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Software; and, (ii) to sub-license Citrix Plug-In Software containing
Incorporated Files and Device Drivers/Headers.
4.8 Further Patent Licenses. Each of the parties agrees to enter into the
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Patent License Agreement attached hereto as Exhibit F as a condition
to the effectiveness of each of the license grants set forth in this
Section 4.
4.9 Trademark Use. The parties will use good faith efforts to enter into
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appropriate trademark agreements in support of the activities
anticipated by this Agreement.
5 Ownership
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5.1 Existing Rights. All intellectual property rights which each party
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owns as of the Effective Date of this Agreement shall remain the sole
and exclusive property of such party and no licenses are granted or
implied, other than those expressly granted herein or in other written
agreements between the parties.
5.2 Work Under This Agreement. With the exception of (i) Citrix Plug-In
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Software, (ii) any component or implementation of ICA developed by
Citrix, and (iii) any other Citrix value added software not
encompassed by the scope of Exhibits C or D, Citrix hereby irrevocably
assigns to Microsoft, its successors and assigns, all right, title and
interest in and to all Inventions, copyrighted materials, and other
intellectual property created by Citrix employees or contractors
participating in the development of Hydrix and related work as
described in Exhibits C and D, or in the course of developing any Key
System Client Software port as described in Section 4.2 or ICA Version
of Internet Explorer as described in Section 4.3. Citrix hereby
irrevocably transfers and assigns to Microsoft any and all "moral
rights" that Citrix may have in all Inventions, copyrighted materials,
and other intellectual property which it assigns to Microsoft under
the previous sentence, and Citrix also forever waives and agrees never
to assert any and all such "moral rights" which it may retain
notwithstanding the previous clause, regardless of the termination or
expiration of this Agreement. Citrix will execute and deliver such
instruments and take such other actions as may be requested by
Microsoft to perfect or protect Microsoft's rights and to carry out
the assignments effected by this Section 5.2.
6 Confidentiality
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6.1 Confidentiality Obligations. Each party expressly undertakes to
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retain in confidence all non-public information and know-how disclosed
by the other party to it that has been designated as proprietary
and/or confidential or that, by the nature of the circumstances
surrounding the disclosure, ought in good faith to be treated as
proprietary and/or confidential (the "Confidential Information"), and
will make no use of such information except as permitted under the
terms of this Agreement. Without limiting the generality of the
foregoing, Confidential Information includes the terms and conditions
of this Agreement and all
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agreements between the parties referenced herein (subject, in each
case, to any obligations of the parties to disclose such information,
and to the limited extent so required, under any applicable rules of
the Securities and Exchange Commission and any securities exchange on
which the securities of such party are then or at any time hereafter
traded), and all Source Code provided by either party to the other in
connection with this Agreement. Each party shall use its best efforts
to protect Confidential Information of the other party, which efforts
shall be at least as great as the precautions it takes to protect its
own confidential information. Each party may disclose the other
party's Confidential Information only to its employees and contractors
under suitable non-disclosure agreement on a "need to know" basis.
Each party may also disclose such Confidential Information as required
by government or judicial order, provided each party gives the other
party prompt notice of such disclosure and cooperates with the other
party in seeking protective orders and other means to prevent or limit
such disclosures. Each party shall notify the other party promptly
upon the discovery of any unauthorized use or disclosure of the other
party's Confidential Information, and will cooperate with the other
party in every reasonable way to assist the other party in regaining
possession of such Confidential Information and to prevent future
unauthorized use or disclosures.
6.2 Microsoft Source Code Confidentiality. Subject to any licenses
-------------------------------------
granted under Section 4, in addition to the protections afforded to
Confidential Information pursuant to Section 6.1 above, Citrix
undertakes the following additional obligations with respect to
Microsoft Source Code received hereunder: Citrix shall not reproduce,
duplicate, copy or otherwise disclose, distribute or disseminate
Microsoft Source Code in any media except for Citrix' own internal use
by Citrix' full-time employees, and consultants which have been
approved in advance by Microsoft, under suitable non-disclosure
agreements on a need-to-know basis on Company premises. Citrix shall
make only two (2) archival copies of each version of Microsoft Source
Code, all of which shall be stored in a vault. The Microsoft Source
Code shall be controlled by Citrix using a reasonable control and
security procedure.
6.3 Hydrix Plug-In Interface. The Hydrix Plug-In Interface is
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[CONFIDENTIAL TREATMENT REQUESTED]/*/ , and, reflecting the nature of
the joint development under this Agreement, [CONFIDENTIAL TREATMENT
REQUESTED]/*/, provided however that [CONFIDENTIAL TREATMENT
REQUESTED]/*/ by either party which do not grant a license or permit
the use of
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/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2
PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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the Hydrix Plug-In Interface shall not be deemed [CONFIDENTIAL
TREATMENT REQUESTED]/*/.
6.4 Exclusions. Confidential Information shall not include that
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information defined as Confidential Information above which: (i)
became generally publicly available without the receiving party's
breach of any obligation owed to the disclosing party under this
Agreement; (ii) became known to the receiving party prior to the
disclosure of such information; (iii) became known to the receiving
party from a third party other than by the breach of an obligation of
confidentiality owed under this Agreement; or (iv) was independently
developed by the receiving party.
6.5 Residuals. The terms of confidentiality under this Agreement shall
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not be construed to limit either party's right to independently
develop or acquire products without use of the other party's
Confidential Information. Further, either party shall be free to use
for any purpose the residuals resulting from access to or work with
such Confidential Information, provided that such party shall maintain
the confidentiality of the Confidential Information as provided
herein, except to the extent that disclosure is inherent from selling,
licensing or otherwise disposing of a product using or incorporating
such residuals. The term "residuals" means information in non-
tangible form which may be retained by persons who have had access to
the Confidential Information, including ideas, concepts, know-how or
techniques contained therein. Neither party shall have any obligation
to limit or restrict the assignment of such persons or to pay
royalties for any work resulting from the use of residuals or the sale
of products using or incorporating residuals. However, the foregoing
shall not be deemed to grant to either party a license under the other
party's copyrights or patents.
7 Technical Coordinators; Executive Oversight; Marketing Liaisons
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7.1 The Technical Coordinators for the parties are:
For Citrix:
[CONFIDENTIAL TREATMENT REQEUSTED]/*/
For Microsoft:
[CONFIDENTIAL TREATMENT REQUESTED]/*/
- ----------------------
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AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2
PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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7.2 The Technical Coordinators shall be responsible for:
7.2.1 Submission and acceptance of materials required to be delivered
under this Agreement;
7.2.2 Arranging such meetings, visits and consultations between
Microsoft and Citrix personnel associated with the work to be
performed under this Agreement as may be deemed necessary or
desirable for successful accomplishment of such work; and
7.2.3 Preparation of amended Exhibits and submission of amended
Exhibits to Named Executives for approval as provided below.
7.3 The Named Executives for the parties are:
For Citrix:
[CONFIDENTIAL TREATMENT REQUESTED]/*/
For Microsoft:
[CONFIDENTIAL TREATMENT REQUESTED]/*/
7.4 The Named Executives shall be responsible for:
7.4.1 Prompt resolution of any and all issues that arise in the
course of the work to be performed hereunder and that cannot be
resolved by the parties' respective Technical Coordinators; and
7.4.2 Approval of any and all amendments to the Exhibits to this
Agreement.
7.5 Amendment of the terms and conditions set forth in the body of this
Agreement are not within the authority of the Technical Coordinators.
Any modification of the terms set forth herein shall be reduced to a
formal written amendment and executed by authorized representatives of
the corporations.
7.6 No alteration of the terms of any Exhibit shall be effective until and
unless an amended Exhibit is initialed and dated by the Named
Executive of both parties.
- ----------------------
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AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
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PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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7.7 The Marketing Liaisons for the parties are:
For Citrix:
[CONFIDENTIAL TREATMENT REQUESTED]/*/
For Microsoft:
[CONFIDENTIAL TREATMENT REQUESTED]/*/
7.8 The Marketing Liaisons shall be responsible for fulfilling the
parties' obligations under Exhibit E.
7.9 Each party shall advise the other in writing of any successor or
designee of their respective Technical Coordinators, Named Executives
or Marketing Liaisons.
8 Covenants
---------
8.1 In order to facilitate the exchange of information and the joint
development work to be performed hereunder, and in consideration of
the terms and conditions of this Agreement, the parties shall abide by
the following covenants during the term of this Agreement (unless
otherwise specified below):
8.2 Hydrix shall support ICA in an equitable manner in comparison to the
support provided by such server offerings for other protocols of
Microsoft or third party clients.
8.3 Microsoft will [CONFIDENTIAL TREATMENT REQUESTED]/*/ to allow client
devices implementing ICA to attach to Hydrix servers. Citrix
acknowledges that such licensing scheme may require the use of Key
System Client Software. Without limiting the generality of the
foregoing, Microsoft's [CONFIDENTIAL TREATMENT REQUESTED]/*/ for
Windows CE Key System Client Software licenses [CONFIDENTIAL TREATMENT
REQUESTED]/*/ in comparison to [CONFIDENTIAL TREATMENT REQUESTED]/*/
for Key System Client Software licenses for end users of Pure ICA
Devices.
8.4 After Microsoft begins to market and distribute Hydrix, Microsoft
agrees to use commercially reasonable efforts to make Hydrix available
in at least the same set of international versions and on at least the
same set of platforms as Windows NT Server is offered. Microsoft will
use commercially reasonable efforts to release
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such additional versions in a timely manner given the development
requirements therefor, and provided that Microsoft in its sole
discretion shall determine its release schedule for all versions of
Hydrix.
8.5 Provided that Microsoft ships a Hydrix 4.0 product and a Hydrix 5.0
product, during the term of this Agreement, Citrix agrees to limit
updates of its current Multi-User product (currently known as
"WinFrame") as follows: [CONFIDENTIAL TREATMENT REQUESTED]/*/.
"Product Release" shall mean a major release of Product which is
designated by Citrix in its sole discretion as a change in the
digit(s) to the left of the decimal point in the product version
number [(x).xx]; and "Version Release" shall mean a release of Product
containing only minor enhancements and bug fixes which is designated
by Citrix in its sole discretion as a change in the tenths digit in
the product version number [x.(x)x]. For as long as Citrix complies
with the foregoing limitation, Microsoft shall provide it with Windows
NT Server v.3.51 Source Code as necessary to develop and maintain such
authorized WinFrame 2.0/3.51 versions in localized form.
Notwithstanding the foregoing, if Microsoft, despite making
commercially reasonable efforts, is unable to release (i) a Hydrix 4.0
product within [CONFIDENTIAL TREATMENT REQUESTED] /*/ of the Effective
Date, (ii) a Hydrix 5.0 product within the later of a) [CONFIDENTIAL
TREATMENT REQUESTED]/*/ after initial release of a Hydrix 4.0 product
and b) [CONFIDENTIAL TREATMENT REQUESTED]/*/ after the Effective Date,
or (iii) a Hydrix product for the second Product Release of Windows NT
Server following the Effective Date (currently assumed to be Windows
NT Server v.6) within [CONFIDENTIAL TREATMENT REQUESTED]/*/ after
initial release of Hydrix 5.0 product, then Citrix may offer, license
and distribute [CONFIDENTIAL TREATMENT REQUESTED]/*/ of WinFrame for
Windows NT Server v. 3.51 without violating its obligations under this
Section.
8.6 Provided that Microsoft is in compliance with Section 8.9, Citrix
agrees [CONFIDENTIAL TREATMENT REQUESTED]/*/ developing or assisting
any third party in developing, [CONFIDENTIAL TREATMENT REQUESTED]/*/
as defined in this Agreement, without Microsoft's prior written
consent.
8.7 For the first [CONFIDENTIAL TREATMENT REQUESTED]/*/ after the
Effective Date of this Agreement, Microsoft agrees to refrain from
shipping any Multi-User client device support for any device other
than a Windows Client Device and will not make any representation or
announcement of its intention to develop or ship such Plug-In Software
for [CONFIDENTIAL TREATMENT REQUESTED]/*/ after the Effective Date.
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UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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8.8 Microsoft agrees to endorse only ICA as the preferred way to provide
Multi-User Windows access for devices other than Windows Client
Devices for a period of two and one-half (2.5) years from the
Effective Date.
8.9 Provided that Citrix is in compliance with Section 8.6, Microsoft
agrees [CONFIDENTIAL TREATMENT REQUESTED]/*/ developing or assisting
third parties in developing [CONFIDENTIAL TREATMENT REQUESTED]/*/, as
defined in this Agreement, [CONFIDENTIAL TREATMENT REQUESTED]/*/,
without Citrix' prior written consent.
8.10 In the event Citrix fails to actively pursue the market for
supporting specific client device types (e.g., Macintosh) with Citrix
Plug-In Software and provide a commercially competitive product on
those specific client device types on an on-going basis, Microsoft
shall have the right to lift restrictions in Sections 6.3 and 8.7 for
those affected client device types upon written notice to Citrix,
provided Citrix does not cure such failure within [CONFIDENTIAL
TREATMENT REQUESTED]/*/ of notice or a technically reasonable time
period.
8.11 Microsoft agrees to make commercially reasonable efforts to bundle
ICA client software as supplied by Citrix with Microsoft Windows
family products during the term of the Agreement, provided that
Microsoft shall not be obligated to do so if such bundling materially
increases product costs and/or materially increases end-user
electronic download times. Microsoft shall offer this through its
standard delivery mechanisms, but not require its OEMs to bundle such
client software.
8.12 Microsoft shall continue to make Hydrix 4.x products commercially
available for [CONFIDENTIAL TREATMENT REQUESTED]/*/ beyond the release
(if any) of Hydrix 5.0 and Hydrix 5.x for [CONFIDENTIAL TREATMENT
REQUESTED]/*/ beyond the release of Hydrix products for the second
Product Release of Windows NT Server following the Effective Date
(currently assumed to be Windows NT Server v.6).
8.13 Microsoft covenants that it will not distribute a Multi-User server
which provides Multi-User access to Windows-based applications during
the term of this Agreement other than the Multi-User Windows NT
defined as Hydrix herein, unless such server is a functional
replacement, including the Hydrix Plug-In Interfaces, for Hydrix that
provides access to Windows-based applications and is distributed
subject all terms of this Agreement including Section 9.
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UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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9 Payment
-------
9.1 Fees. In consideration of Citrix' development obligations, license
----
grants, and the other terms and conditions of this Agreement,
Microsoft agrees to pay the fees set forth in this Section 9 during
the term of this Agreement.
9.1.1 Microsoft shall pay initial fees and royalties to Citrix within
thirty (30) days of the Effective Date, as follows:
9.1.1.1 The sum of Thirteen Million Dollars ($13,000,000) for
engineering services to be provided by Citrix to
Microsoft for Hydrix products as defined in Exhibits C
and D, such amount to be due and payable without
regard to shipment by Microsoft of any Hydrix products
described herein.
9.1.1.2 The sum of Sixty Two Million Dollars ($62,000,000) as
an initial non-refundable royalty payment, the full
amount of such payment to be irrespective of the
number of units or dollar amount of any Hydrix
products shipped, if any, by Microsoft hereunder.
9.1.2 Subject to the other terms and conditions of this Agreement,
Microsoft shall pay the following additional royalties to
Citrix with respect to Microsoft's distribution of Hydrix:
9.1.2.1 For Hydrix products which Microsoft prices separately
and the primary function of which is to add Multi-User
functionality to applicable versions of Windows NT
Server ("Add-on Products"), Microsoft shall pay a
royalty of [CONFIDENTIAL TREATMENT REQUESTED]/*/ of
its Net Receipts from distribution of such products.
9.1.2.2 Microsoft shall pay Citrix an additional royalty of
[CONFIDENTIAL TREATMENT REQUESTED]/*/ of its Net
Receipts from licenses that enable customers to attach
Hydrix client devices to a Hydrix Server and execute
Windows applications on such servers (but excluding
Net Receipts from any other Microsoft software which
may be distributed or licensed in conjunction with the
right to attach and execute Windows applications on
the server).
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UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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9.1.2.3 In each quarter, Microsoft shall calculate the
revenues Citrix would have been due from a royalty of
[CONFIDENTIAL TREATMENT REQUESTED]/*/. If, in a given
quarter, this alternative royalty would have exceeded
that sum due to Citrix under Sections 9.1.2.1 and
9.1.2.2, then this alternative royalty shall apply.
9.1.2.4 Within forty five (45) days after the end of each
calendar quarter with respect to which Microsoft owes
Citrix any royalties hereunder, Microsoft shall
furnish Citrix a statement together with payment for
any amount shown thereby to be due to Citrix. The
royalty statement shall be based upon Net Receipts for
the quarter then ended, and shall contain information
sufficient to discern how the royalty payment was
computed in a form agreed upon.
9.1.2.5 Microsoft shall not be obligated to pay any royalties
to Citrix with respect to (i) any product which is
distributed as "free," "complimentary," "no charge,"
or at nominal prices to cover shipping and handling,
in support of normal marketing activities, or (ii) MS'
internal use and sale to employee copies. Microsoft
shall be entitled to withhold from all royalty sums
otherwise payable hereunder a reasonable reserve, made
in good faith, against anticipated returns of Hydrix
products and Key System Client Software which it
distributes, provided that such reserve shall not
exceed fifteen percent (15%) of all amounts due
hereunder for the two (2) most recent calendar
quarters, without adjustment for reserve, and which
reserve shall be reviewed quarterly in light of the
actual returns of the preceding two (2) quarters. The
excess (short-fall), if any, of such reserve balance
at the time of such quarterly review over (under) the
actual aggregate amount of returns for such period
shall be credited to (debited against) the next
payment due Citrix hereunder.
9.2 Minimum and Maximum Payments.
----------------------------
9.2.1 In the event that during any of the five calendar quarters
after the commercial release of Hydrix 4.0, Microsoft's payment
of fees with respect to Hydrix 4.x products for such quarter
does not equal at least [CONFIDENTIAL TREATMENT REQUESTED]/*/ ,
Microsoft shall within forty-five (45) days after the end of
such calendar quarter pay an additional amount to Citrix such
that the cumulative payment for such
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quarter equals [CONFIDENTIAL TREATMENT REQUESTED]/*/. Once
Microsoft has made payments to Citrix hereunder totaling Fifty
Million Dollars ($50,000,000.00) for royalty-bearing products
associated with Hydrix 4.x, Microsoft's obligation to make any
further payments under Section 9.1.2 associated with Hydrix 4.0
shall cease.
9.2.1.1 Notwithstanding the provisions of the foregoing
paragraph, if Citrix achieves delivery of Hydrix 4.0
which is accepted by Microsoft (such acceptance not to
be unreasonably withheld) prior to [CONFIDENTIAL
TREATMENT REQUESTED]/*/ , then any unearned portion of
Hydrix royalties remaining payable on Hydrix 4.0 below
$50 Million, shall be added to the $50 Million Dollar
cap on royalties to be paid to Citrix on Hydrix 5.0.
9.2.2 In the event that during any of the five calendar quarters
after the commercial release of Hydrix 5.0, Microsoft's payment
of fees with respect to Hydrix 5.x products for such quarter
does not equal at least [CONFIDENTIAL TREATMENT REQUESTED]/*/,
Microsoft shall within forty-five (45) days after the end of
such calendar quarter pay an additional amount to Citrix such
that the cumulative payment for such quarter equals
[CONFIDENTIAL TREATMENT REQUESTED]/*/. Except as provided in
Section 9.2.1.1 above, once Microsoft has made payments to
Citrix hereunder totaling Fifty Million Dollars
($50,000,000.00) for royalty-bearing products associated with
Hydrix 5.0, Microsoft's obligation to make any further payments
under Section 9.1.2 associated with Hydrix 5.0 shall cease.
9.3 Further Payment. In no case shall Microsoft be required to make any
---------------
payments on major Product Release of Hydrix beyond version 5.x, or any
amount in excess of $175 Million Dollars under this Agreement.
9.4 Address for Payments. Payments provided for in this Section shall be
--------------------
made electronically to an address and account to be provided by
Citrix.
9.5 Taxes. Payments provided for in this Section are exclusive of any
-----
federal, state, municipal or other governmental taxes.
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9.6 Audits.
------
9.6.1 During the term of this Agreement and for three (3) years
thereafter, Microsoft agrees to keep all usual and proper
records and books of account and all usual and proper entries
relating to Hydrix sufficient to substantiate the number of
copies of Hydrix, distributed or otherwise disposed of by or
for Microsoft. Microsoft shall maintain such records for
itself and for each Microsoft subsidiary which exercises
rights under this Agreement.
9.6.2 In order to verify statements issued by Microsoft and
Microsoft's compliance with the terms of this Agreement, upon
prior written notice to Microsoft, Citrix may cause (i) an
audit to be made of Microsoft's and/or Microsoft's
subsidiaries' books and records; and/or (ii) an inspection to
be made of Microsoft's and/or Microsoft's subsidiaries'
facilities and procedures. Any audit and/or inspection shall
be conducted during regular business hours at Microsoft's
and/or Microsoft's subsidiaries' facilities. Any audit shall
be conducted by a nationally recognized independent certified
public accountant selected by Citrix (other than on a
contingent fee basis).
9.6.3 Microsoft agrees to provide Citrix' designated audit or
inspection team access to the relevant Microsoft and/or
Microsoft subsidiaries' records and facilities.
9.6.4 Prompt adjustment shall be made to compensate for any errors
or omissions disclosed by such audit. Any such audit shall be
paid for by Citrix unless material discrepancies are
disclosed. "Material" shall mean more than five percent (5%)
of the amount that was reported. If material discrepancies are
disclosed, Microsoft agrees to pay Citrix for the costs
associated with the audit. In no event shall audits be made
more frequently than annually.
10 Term, Termination, and Limitation of Remedies
---------------------------------------------
10.1 The term of this Agreement shall commence as of the Effective Date
and shall continue for a period of [CONFIDENTIAL TREATMENT
REQUESTED]/*/ , unless terminated in accordance with the provisions
of this Section 10 or extended by a mutually agreed amendment hereto.
10.2 After escalation to the parties' Named Executives, including a
presentation by each party to the Named Executive of the other party
of their respective concerns,
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UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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either party may terminate this Agreement if the other party is in
material breach of any term or condition of this Agreement and fails
to cure that breach within ninety (90) days after receipt of written
notice thereof.
10.3 In the event that Citrix ships a Product Release incorporating
technology from Microsoft Windows NT Server version 3.51, except as
permitted by Section 8.5, (i) Citrix' rights to Windows NT Server
v.3.51 Source Code and Object Code, as they exist as of the Effective
Date under this Agreement, will be extended by an additional
[CONFIDENTIAL TREATMENT REQUESTED]/*/ from the date they would
otherwise expire; (ii) all of Microsoft's further payment obligations
to, Citrix under Sections 9.1 and 9.2 shall immediately terminate and
Microsoft's licenses under this Agreement shall thereafter be
royalty-free; and (iii) all of Microsoft's obligations under Sections
6.3, 8.7, and 8.8 shall immediately cease.
10.4 Citrix may, at its option, also invoke the remedies set forth in
Section 10.3(i), (ii), and (iii) at any time in its sole discretion,
provided that such election of remedies shall be Citrix' sole and
exclusive remedy in the event of any breach by Microsoft of Section
8.3 or its development obligations hereunder.
10.5 The following Sections shall survive any expiration or termination of
this Agreement in accordance with their terms: Sections 1, 4.1, 4.2,
4.5, 5, 6 (excluding 6.3), 10, 11, 12, 13, 14.1, 15, 16, 17, 19, 22,
and Exhibit F (Patent License). Section 21 shall survive according to
its terms.
11 Warranties
----------
11.1 Each party represents and warrants that:
11.1.1 It has full power to enter into this Agreement and grant the
license rights set forth herein:
11.1.2 It has not previously and will not grant any rights to any
third party that are in conflict with the rights granted to
the other party herein;
11.1.3 The information or materials delivered to the other party
hereunder do not (i) infringe any copyright enforceable under
the laws of the countries listed in Section 11.3; (ii)
violate any trade secret right of any third party, or (iii)
to the best of the delivering parties' knowledge infringe any
patent right of any third party as of the Effective Date.
11.2 EXCEPT AS PROVIDED IN SECTION 11.1 ABOVE, THE INFORMATION AND
MATERIALS DELIVERED BY EACH PARTY TO THE OTHER
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UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
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PURSUANT TO THIS AGREEMENT ARE PROVIDED "AS IS" WITHOUT WARRANTY OF
ANY KIND. ANY REPRESENTATIONS OR WARRANTEES MADE BY EITHER PARTY TO
ITS CUSTOMERS, EXPRESS OR IMPLIED, BY LAW OR OTHERWISE, REGARDING
INTELLECTUAL PROPERTY ARE THE SOLE RESPONSIBILITY OF SUCH PARTY. EACH
PARTY DISCLAIMS ALL OTHER WARRANTIES OF MERCHANTABILITY AND FITNESS
FOR A PARTICULAR PURPOSE.
11.3 Neither party shall have any obligation to the other for any
copyright infringement claim made against the other which arises from
the use or distribution of products outside the geographical
boundaries of the United States, Canada, Australia, Japan, the
European Economic Community, Sweden, Norway, and Finland, and each
party hereby releases and discharges the other from any and all
copyright infringement claims resulting from such use or
distribution.
12 Indemnity
---------
12.1 Each party shall (the "Indemnifying Party"), at its expense and upon
request, defend any claim or action brought against the other party,
and the other party's subsidiaries, affiliates, directors, officers,
employees, agents and independent contractors (the "Indemnified
Party"), which, if true, would constitute a breach of a warranty set
forth in Section 11, and the party will indemnify and hold the other
party harmless from and against any costs, damages and fees
reasonably incurred by the other party, including but not limited to
fees of attorneys and other professionals, that are attributable to
such claim; provided that: (i) the Indemnified Party provides the
Indemnifying Party with reasonably prompt notice in writing of any
such claim or action and permits the Indemnifying Party, through
counsel reasonably acceptable to the Indemnified Party, to answer and
defend such claims or action; and (ii) the Indemnified Party provides
the Indemnifying Party information, assistance and authority to help
the Indemnifying Party to defend such claim or action. The
Indemnifying Party shall reimburse the Indemnified Party upon demand
for any payments made or loss suffered by the Indemnified Party at
any time after the date hereof in respect of any liability or claim
to which the foregoing indemnity relates, and which has resulted in
an adverse judgment of a court of competent jurisdiction or has been
settled with the consent of the Indemnifying Party.
12.2 The Indemnified party shall have the right to employ separate counsel
and participate in the defense of any claim or action at its expense.
12.3 Following notice of an Infringement Claim, the Indemnifying Party
may, at its expense, without obligation to do so, procure for the
Indemnified Party the right to continue to market, use and have
others use the information or materials claimed to be infringing or,
without obligation to do so, may replace any information or materials
to make them non-infringing. If the Indemnifying Party
-23-
elects to replace or modify any information or materials, such
replacement shall meet substantially the specifications for such
information or materials provided for in this Agreement, if any, and
shall be subject to any acceptance provisions of this Agreement
applicable to the delivery of such information or materials.
12.4 Neither party shall have any liability for any infringement claim
based on the other party's (i) use or distribution of products after
receipt of notice from the other party that the party should cease
use or distribution of the product due to an infringement claim; or
(ii) combination of information or materials delivered by the other
party hereunder with other programs or data, if such infringement
claim would have been avoided by the exclusive use of the information
or materials delivered hereunder. For all infringement claims arising
under this Section 12.4, the other party agrees to indemnify and
defend the delivering party from and against all damages, costs and
expenses, including reasonable attorneys' fees.
13 Limitation of Liability; Actions
--------------------------------
13.1 Except with respect to Section 21 and breach of Section 6.1, 6.2, and
6.3 (subject to 13.2), NEITHER PARTY SHALL BE LIABLE FOR ANY
INDIRECT, INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR SPECIAL DAMAGES,
EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES IN ADVANCE. The parties acknowledge that other parts of this
Agreement rely upon the inclusion of this Section.
13.2 Notwithstanding Section 13.1, Citrix may recover against Microsoft
indirect, incidental, consequential, or special damages that are
awarded by a court of competent jurisdiction following exhaustion of
all appeals to which Microsoft is entitled, up to a total cap of
[CONFIDENTIAL TREATMENT REQUESTED]/*/ for any uncured, material
breach of Section 6.3.
13.3 Nothing in this Agreement shall affect or limit either party's right
to collect any amounts otherwise due under the terms of this
Agreement or to institute and prosecute proceedings in any court of
competent jurisdiction (as provided in Section 19), under any
applicable laws, seeking direct damages for breach of this Agreement,
specific performance of this Agreement, or an order enjoining the
other party from activities in violation of this Agreement.
14 Agreements with Employees and Others
------------------------------------
14.1 Each party represents that it has or will obtain appropriate
agreements with its employees or others including subcontractors,
whose services it may require,
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-24-
sufficient to enable such party to comply with all the provisions of
this Agreement.
14.2 Personnel used or supplied by Microsoft in the performance of work
hereunder shall be employees or contractors of Microsoft, and under
no circumstances are such personnel to be considered employees or
agents of Citrix. Microsoft shall have the sole responsibility for
supervision and control of its personnel, payment of salary,
including withholding of income taxes and social security taxes,
worker's compensation, disability benefits and the like.
14.3 Personnel used or supplied by Citrix in the performance of work
hereunder shall be employees or contractors of Citrix, and under no
circumstances are such personnel to be considered employees or agents
of Microsoft. Citrix shall have the sole responsibility for
supervision and control of its personnel, payment of salary,
including withholding of income taxes and social security taxes,
worker's compensation, disability benefits and the like.
14.4 Neither Microsoft nor Citrix shall knowingly and intentionally induce
any Engineer (as defined below) to terminate his or her employment
with the other party while such person is serving as an Engineer,
provided that it shall not be a breach of this Section for either
party to hire an Engineer of the other party who has responded to
general advertisements or has applied for a position via normal
recruitment channels. An "Engineer" refers to a development or test
engineer who has significant experience in working with Multi-User
technology.
15 No Partnership, Joint Venture or Franchise
------------------------------------------
Neither this Agreement, nor any terms and conditions contained herein,
shall be construed as creating a partnership, joint venture or agency
relationship or as granting a franchise as defined in the Washington
Franchise Investment Protection Act, RCW 19.100, as amended, or 16 CFR
Section 436.2(a).
16 Compliance with Laws and Regulations
------------------------------------
Each party agrees that it will not export or re-export any product or
technical data of the other party to any country, person, entity or end
user to which such export would be a violation of any applicable export
restriction. Restricted countries for purposes of U.S. law and regulations
currently include, but are not necessarily limited to, Cuba, Iran, Iraq,
Libya, North Korea, the Sudan, and Syria. Each party further agrees to do
all things necessary to comply with all applicable laws, rules and
regulations concerning exports of products and technical data of the other
party.
17 Notices
-------
17.1 All notices and requests in connection with this Agreement shall be
deemed given as of the day they are received either by messenger,
delivery service, or in the
-25-
United States of America mails, postage prepaid, certified or
registered, return receipt requested, and addressed as follows:
To Citrix:
Citrix Systems, Inc.
6400 NW 6th Way
Fort Lauderdale, Florida 33309
Attention: President
Phone: (954) 267-3000
Fax: (954) 267-9319
Copy to: General Counsel, George W. Thibeault
Fax: (617) 248-7100
To Microsoft:
Microsoft Corporation
One Microsoft Way
Redmond, WA 98052-6399
Attention: Group Vice President, Platforms
Phone: (425) 882-8080
Fax: (425) 936-7329
Copy to: Law & Corporate Affairs
Fax:(425) 936-7409
17.1.1 or to such other address as a party may designate pursuant to
this notice provision.
18 Excusable Delays
----------------
Neither party hereto shall be in default by reason of any failure in the
performance hereunder in accordance with any terms, if such failure is due
to, acts of the public enemy, acts of the Government in either its
sovereign or contractual capacity, fires, floods, epidemics, quarantine
restrictions, freight embargoes, civil commotions and the like.
19 Governing Law; Jurisdiction; Attorneys' Fees
--------------------------------------------
This Agreement shall be governed by the laws of the State of Washington as
though entered into between Washington residents and to be performed
entirely within the State of Washington. In any formal action or suit to
enforce any right or remedy under this Agreement or to interpret any
provision of this Agreement (i) the prevailing party shall be
-26-
entitled to recover its costs, including reasonable attorneys' fees, and
(ii) the party bringing the action shall bring the action in a court in the
state and county where the other party's corporate headquarters is located.
20 Assignment
----------
20.1 Neither party shall assign or otherwise transfer any of its rights or
privileges under this Agreement, including the patent licenses
granted hereunder, to any third party, under action of law or
otherwise, including without limitation in connection with any
acquisition of a party by a third party (including without limitation
by merger, sale of stock, or otherwise) or in connection with the
insolvency or bankruptcy of either of the parties, without the prior
written consent of the other party. An assignment shall be deemed to
include Citrix' acquisition of a controlling interest in a company
listed on Exhibit H. Microsoft may revise the list on Exhibit H upon
notice to Citrix, but may not increase the number of companies on the
list may not add companies to the list more often than quarterly, and
may not add a company to the list if, at that time, Citrix can
demonstrate that it is already in acquisition discussions with such
company for as long as such negotiation discussions continue. Any
attempted assignment in derogation of the foregoing shall be void.
20.2 This Section shall supersede the equivalent section in any contracts
between the parties entered into prior to the Effective Date.
21 Pre-Agreement Claims
--------------------
21.1 Citrix covenants and agrees that it (and any other person or entity
under its direction or control, and any other person or entity which
Citrix has engaged to act on its behalf) will not assert any claims
against Microsoft, any Microsoft employee, or any Microsoft
subsidiary based upon any matter that occurred prior to the Effective
Date of this Agreement ("Pre-Agreement Claims"). Notwithstanding
anything to the contrary in the preceding sentence, Citrix may assert
any Pre-Agreement Claims against Microsoft, Microsoft employees, or
Microsoft subsidiaries in the event that (a) Microsoft commits a
material breach of the Agreement which has not been cured within
sixty (60) days of notice of breach, and Citrix elects to terminate
the Agreement because of such breach; or (b) Microsoft terminates the
Agreement for any reason other than material breach by Citrix which
has not been cured within sixty (60) days of notice of breach.
21.2 Microsoft covenants and agrees that it (and any other person or
entity under its direction or control, and any other person or entity
which Microsoft has engaged to act on its behalf) will not assert any
claims against Citrix, any Citrix employee, or any Citrix subsidiary
based upon any matter that occurred prior to the Effective Date of
this Agreement ("Pre-Agreement Claims"). Notwithstanding anything to
the contrary in the preceding sentence, Microsoft may assert any Pre-
Agreement Claims against Citrix, Citrix employees, or Citrix
subsidiaries in the event that
-27-
(a) Citrix commits a material breach of the Agreement which has not
been cured within sixty (60) days of notice of breach, and Microsoft
elects to terminate the Agreement because of such breach; or (b)
Citrix terminates the Agreement for any reason other than material
breach by Microsoft which has not been cured within sixty (60) days
of notice of breach.
21.3 This Section 21 shall survive expiration of the five-year term of the
Agreement but shall not survive termination for breach of the
Agreement.
22 Construction
------------
If for any reason a court of competent jurisdiction finds any provision of
this Agreement, or portion thereof, to be unenforceable, that provision of
the Agreement will be enforced to the maximum extent permissible so as to
effect the intent of the parties, and the remainder of this Agreement will
continue in full force and effect. Failure by either party to enforce any
provision of this Agreement will not be deemed a waiver of future
enforcement of that or any other provision. This Agreement has been
negotiated by the parties and their respective counsel and will be
interpreted fairly in accordance with its terms and without any strict
construction in favor or against either party.
23 Entire Agreement
----------------
This Agreement constitutes the entire agreement between the parties with
respect to its subject matter and merges all prior and contemporaneous
communications, and this Agreement supersedes those provisions of the
License, Development, and Marketing Agreement dated July 9, 1996 between
the parties pertaining to Microsoft's distribution of a Multi-User product.
It shall not be modified except by a written agreement dated subsequent to
the date of this Agreement and signed on behalf of Citrix and Microsoft by
their respective duly authorized representatives.
Except as otherwise provided in this Agreement, nothing in this Agreement shall
modify any agreement between the parties entered into prior to the Effective
Date.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
-28-
IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
Effective Date written above.
MICROSOFT CORPORATION CITRIX SYSTEMS, INC.
/s/ Paul Maritz /s/ Edward E. Iacobucci
- ----------------------------- ---------------------------------
By (Sign) By (Sign)
Paul Maritz Edward E. Iacobucci
- ----------------------------- ---------------------------------
(Name (Print) Name (Print)
Group Vice President Chairman
- ----------------------------- ---------------------------------
Title Title
May 9, 1997 May 9, 1997
- ----------------------------- ---------------------------------
Date Date
Exhibit A
Citrix Deliverables
-------------------
Multi-User enabler Source Code from WinFrame 2.0/4.0. The Multi-User enabler
Source Code includes the Source Code that has been integrated into the Windows
NT 4.0 source base to enable Windows NT for a Multi-User execution model.
Specifically, this includes but is not limited to:
[CONFIDENTIAL TREATMENT REQUESTED]/*/
Communications Subsystem Source Code for WinFrame 2.0/4.0. The Communications
Subsystem includes the infrastructure components used to establish and interface
with a connection-based communications stack. Specifically, this includes:
[CONFIDENTIAL TREATMENT REQUESTED]/*/
. To the extent of Citrix' rights therein, any and all administrative tools,
diagnostic tools, tests, and test support systems, test harnesses, performance
measurement and monitoring tools, and any additional software specifically
used in development and testing of the code above.
. Citrix' databases on application-compatibility deficiencies of all versions
of WinFrame, including without limitation all quality, performance and
scalability test suites used by Citrix to verify WinFrame Multi-User
performance.
An initial delivery of Citrix Deliverables (including but not limited to the
Multi-User enabler Source Code and currently available documentation) of shall
be provided by Citrix to Microsoft within [CONFIDENTIAL TREATMENT REQUESTED]/*/
business days of the Effective Date, a complete delivery shall be delivered
within [CONFIDENTIAL TREATMENT REQUESTED]/*/, and updated versions thereof shall
be delivered by Citrix to Microsoft upon availability in connection with the
parties' development obligations under this Agreement.
Other Deliverables
- ------------------
In addition to the "Citrix Deliverables" above, Citrix shall deliver the
following to Microsoft:
[CONFIDENTIAL TREATMENT REQUESTED]/*/
- --------------------------
* [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
- 30 -
Exhibit B
Microsoft Deliverables
----------------------
[CONFIDENTIAL TREATMENT REQUESTED]/*/
The foregoing deliverables shall be delivered by Microsoft as soon as reasonably
practical to Citrix, but within [CONFIDENTIAL TREATMENT REQUESTED]/*/ of the
Effective Date, and updated versions thereof shall be delivered by Microsoft to
Citrix upon availability in connection with the parties' development obligations
under this Agreement.
- ---------------------------
/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
- 31 -
Exhibit C
Hydrix 4.0
----------
Development Responsibilities
- ----------------------------
[CONFIDENTIAL TREATMENT REQUESTED]/*/
Development Requirements
- ------------------------
As part of its development responsibilities hereunder, Citrix will:
[CONFIDENTIAL TREATMENT REQUESTED]/*/
Schedule
- --------
. Citrix will make commercially reasonable efforts to provide an initial
commercial release candidate of Hydrix 4.0 for final conformance testing by
Microsoft as early as possible in order for Microsoft to be able to issue a
commercial product release in calendar year 1997. In the event the commercial
release candidate product delivered by Citrix pursuant to the foregoing does
not pass Microsoft's final conformance testing, at Microsoft's discretion,
Citrix will provide a minimum of [CONFIDENTIAL TREATMENT REQUESTED]/*/ key
development and/or test engineers on site at Microsoft's Redmond campus who
will be dedicated to modifying such code in order for it to pass final
testing, recognizing that time is of the essence in such release.
. Citrix shall also provide to Microsoft: 1) development and milestone
schedule within [CONFIDENTIAL TREATMENT REQUESTED]/*/, 2) weekly status
reports, 3) monthly status meetings, 3) beta not later than [CONFIDENTIAL
TREATMENT REQUESTED]/*/.
. The parties acknowledge that, although time is always of the essence in
product development, the milestones and other key checkpoint dates agreed upon
by the parties are target dates and failure to achieve any of said target
dates shall not constitute a breach of this Agreement. Not withstanding the
foregoing, each party shall act in good faith and make commercially reasonable
efforts to achieve the target dates. Any issues regarding a failure to
fulfill a party' obligation to undertake commercially reasonable efforts shall
be promptly escalated to the Named Executives for resolution.
- ---------------------------
/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
- 32 -
Development Personnel and Locations
- -----------------------------------
. Each party shall provide such technical personnel as are reasonably
necessary to work on the premises of the other party to assist in integration
and conformance testing of portions of the Hydrix code developed by such
party. Each party shall pay its own employees' salaries and expenses,
including travel, communications, and living expenses during such site visits,
with the exception that each party shall provide office space and appropriate
computer equipment to employees of the other party during such site visits.
- 33 -
Exhibit D
Hydrix 5.0
----------
Development Responsibilities
- ----------------------------
[CONFIDENTIAL TREATMENT REQUESTED]/*/
Schedule
- --------
[CONFIDENTIAL TREATMENT REQUESTED]/*/
- ---------------------------
/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
- 34 -
Exhibit E
Joint Marketing; Announcements
------------------------------
Microsoft Endorsement
. Both companies agree to a joint press release and related events, and to
endorse each other's solutions including migration of WinFrame customers to
Hydrix when available, though not at the expense of their own offerings.
. Subject to provisions of section 8, Microsoft agrees to endorse only ICA as
the preferred way to provide Windows access to non-Windows family platforms
for a period of two and one-half (2.5) years from the Effective Date.
Co-Marketing Partnership
. Microsoft and Citrix will provide designated Marketing Liaisons for
handling of all Citrix/Microsoft co-marketing programs.
Announcement
. Microsoft and Citrix will issue a joint press release announcing the
signing of this Agreement.
. Microsoft and Citrix will conduct a joint press conference on a mutually
agreed upon date and location with participation of senior executives from
both companies announcing the signing of this Agreement.
. Microsoft and Citrix will issue a joint press release announcing the
availability of Hydrix 4.0.
. Microsoft will endorse only ICA as the preferred solution for non-Windows32
devices in one or more of the announcements above.
. Microsoft and Citrix will post relevant news announcements on their
Internet web sites.
. Microsoft will provide access to appropriate marketing executives &
managers for written and verbal comment to press and industry analysts.
Attribution
. Microsoft shall include appropriate Citrix copyright or technology
licensing notifications in the "Help About" box which is included Hydrix 4.0,
in product documentation which is included in the packaging for Hydrix 4.0,
and in any advertising and promotional materials which the parties may
mutually agree upon for "Hydrix 4.0.
Training
. Microsoft agrees to provide sales and technical training on Hydrix 4.x and
5.x at no cost to the Citrix sales/systems engineering and support teams.
- 35 -
. Citrix agrees to provide sales and technical training on Citrix Plug-In
Software at no cost to the Microsoft sales/systems engineering and support
teams.
. Microsoft agrees to install Citrix Plug-In Software and to connect at least
one ICA device to Hydrix systems installed at Microsoft customer briefing
centers.
. Microsoft and Citrix will jointly develop an ICA overview component to be
included in Hydrix 4.x and 5.x end user and reseller training materials.
Promotion
. Microsoft and Citrix agree to develop a joint promotional plan for Hydrix
and Citrix Plug-In Software. The promotional plan may include but is not
limited to joint participation in:
. industry tradeshows,
. seminars,
. advertising,
. web links, and
. direct mail
. Upon Microsoft's request Citrix will supply Microsoft with up to l00,000
pieces of Citrix Plug-In Software promotional materials at no charge.
. Microsoft will supply Citrix with soft or camera-ready master copies of
promotional materials for reproduction and distribution by Citrix in
conjunction with Citrix' ongoing marketing activities.
. Microsoft will provide to Citrix at [CONFIDENTIAL TREATMENT REQUESTED]/*/ a
minimum of [CONFIDENTIAL TREATMENT REQUESTED]/*/ Not For Resale (NFR) units of
Hydrix 4.0 and a minimum [CONFIDENTIAL TREATMENT REQUESTED]/*/ Not For Resale
(NFR) seed units of Hydrix 5.0, and five (5) keys to allow Pure ICA clients
using Key System Client Software to connect for each NFR seed unit. Microsoft
will incur no royalty obligations to Citrix on these units.
. Microsoft will provide a page on their web site for 12 months that features
Citrix Plug-In Software for Hydrix.
. Citrix will provide to Microsoft at [CONFIDENTIAL TREATMENT REQUESTED]/*/
Not For Resale (NFR) units of Citrix Plug-In Software.
. Microsoft and Citrix will jointly provide a commercially viable
upgrade/migration program for users of Citrix WinFrame 2.0 and previous
WinFrame products.
- ----------------------------
/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
- 36 -
Exhibit F
Patent License Agreement
------------------------
This Patent License (the "License") is entered into as of the Effective Date by
and between Microsoft Corporation, a Washington corporation ("Microsoft"), and
Citrix Systems, Inc., a Delaware corporation ("Citrix").
WHEREAS Microsoft and Citrix each own rights in certain patents and/or patent
applications for computer software inventions related to multiple user software
systems, including the right to grant patent licenses and releases to the other,
AND WHEREAS each of the Parties expects to continue research and development
which will produce further patents or applications,
AND WHEREAS, in connection with the License, Development and Marketing Agreement
which the Parties are entering into as of the Effective Date and to which this
License is an Exhibit (the "License, Development and Marketing Agreement"), each
of the Parties wishes to be granted freedom from suit under such patents of the
other Party,
NOW, THEREFORE, in consideration of the covenants, terms and conditions
contained in this License, the Parties agree as follows:
1. DEFINITIONS
-----------
1.1. Effective Date shall mean the date upon which this License is signed,
if simultaneously executed by the Parties, or the later of the two
dates on which this License is signed by the Parties, if signed on
different dates.
1.2. Subject Patents shall mean, with respect to each party, all patents
worldwide, including utility models but not including design patents,
with claims directed to a Multi-User Software System or component
thereof, issued or issuing from applications entitled to a first
effective filing date on or before the Patent Date, under which
patents or the applications therefore either Party or any of its
Subsidiaries now has, or hereafter obtains, the right to grant a
license or freedom from suit to the other Party; notwithstanding the
foregoing definition, all patents and applications owned or controlled
by Citrix as of the Effective Date are Citrix Subject Patents. The
term Subject Patents shall include all patents and patent applications
with claims directed to the work performed by the parties under the
License, Development and Marketing Agreement. The term Subject
Patents shall also include all extensions, divisionals, continuations,
continuations-in-part, reexaminations, reissue and provisional patents
as well as patent applications to the extent rights attach to such
applications.
- 37 -
1.3. Multi-User Software System shall mean the client and server
components of a computer software system (and the functions thereof)
in which the server separately supports multiple concurrent clients
connected to the server and wherein (i) the clients (such as
terminals, network computers, personal computers, network PCs, cash
registers, etc.) comprise input and output devices, (ii) the primary
function of the client is to provide output of, and gather input for,
the operating system and other applications that are executing on the
server on behalf of the client; and (iii) the end result is the
appearance to the user of the client that the operating system and
server application(s) are running on the client. A Multi-User
Software System is composed of (and limited to) the following
functional components (which may be packaged separately or in
combination):
1.3.1. A server Base Subsystem for managing multiple user memory,
sessions, processes and threads in an underlying operating
system by allocating operating system resources on behalf of
individual clients and server applications during the multiple
user session, and managing memory and other system resources
that are not otherwise allocated to an individual user; a Base
Subsystem does not include operating system components or
operating system functions which operating system components
or operating system functions are not substantially used for
multi-user systems, but does include the underlying operating
system components that have been modified or enhanced to
support the operations of the Base Subsystem,
1.3.2. Server Session Subsystem for creating and destroying multiple
user sessions, and for delivering to and collecting from
multiple clients, user data and control information,
1.3.3. Client and server Protocol Subsystems for formatting and
transmitting the user data and control information between the
clients and server, the Protocol Subsystem includes the multi-
user data transfer protocol used by the system, and
1.3.4. A Client Subsystem for cooperatively sharing actions directed
by or on behalf of the user and server-based programmatic
behavior between the multiple-user system and the other
systems operating on the client.
Multi-User Software System shall not include operating system components or
operating system functions except for those multi-user operating system
components and functions explicitly set forth in section 1.3.1 through
1.3.4 above. Multi-User Software System shall not include any application
programs that may simply be executed in conjunction with a Multi-User
Software System.
1.4. Combination Product shall mean a product resulting from the
combination of Microsoft or Citrix Product(s) with a product(s)
provided by a third party, which is not a party to this License.
1.5. Foundry Product shall mean a Microsoft or Citrix Product sold,
leased, licensed or otherwise transferred by one Party (the 'Foundry
Party") to this License,
- 38 -
wherein the Product is designed by or for a third party without
substantial design input from the Foundry Party and is transferred
(i) essentially exclusively to that third party or its customers or
(ii) through or by the Foundry Party for the purpose of circumventing
any patent rights of the other Party.
1.6. Clone Product shall mean a Party's Product (which is not a Multi-User
Software System) designed, developed or acquired after the Effective
Date that competes with and is a fully compatible look-alike or act-
alike (by providing the same or substantially the same user interface
and/or APIs) version of an Established Product of the other Party. An
Established Product is a Product publicly released or released for
significant public beta testing and designed, developed, or acquired
before the introduction of the Party's Product; Clone Product shall
exclude software, such as drivers, network protocols, etc., where
such similarity with the user interface or APIs is dictated by
adherence to an industry standard which was widely recognized prior
to the release of the Party's Product. A Party's Product shall not be
deemed to be a Clone Product solely on the basis that it provides the
same or substantially the same functionality as a product of the
other Party. For the purposes of this definition, neither the ICA
protocol nor Microsoft created interfaces and protocols in Microsoft
Windows Operating System Products shall be deemed to be an "industry
standard." "Microsoft Windows Operating System Products" shall mean
Windows (and successors and derivatives), Windows NT (and successors
and derivatives), and Windows CE (and successors and derivatives).
1.7. Microsoft Product shall mean a software product or component thereof
designed, developed, duplicated, manufactured or rendered by or for
Microsoft or one of its Subsidiaries, but shall not include any
Foundry Product or Clone Product.
1.8. Citrix Product shall mean a software product or component thereof
designed, developed, duplicated, manufactured or rendered by or for
Citrix or one of its Subsidiaries, but shall not include any Foundry
Product or Clone Product.
1.9. Subsidiary shall mean a corporation, company or other entity
1.9.1. greater than fifty percent (50%) of whose combined voting
power of the total voting stock (representing the right to
vote for the election of directors or other managing
authority) is, now or hereafter; owned or controlled, directly
or indirectly, by a Party hereto, and is actually controlled
or managed by such Party, but such corporation, company or
other entity shall be deemed to be a Subsidiary only so long
as such voting power, and actual control or management,
exists; or
1.9.2. which does not have outstanding shares or securities, as may
be the case in a partnership, joint venture or unincorporated
association, but greater than fifty percent (50%) of whose
ownership or equity interest is, now or hereafter, owned or
controlled, directly or indirectly, by a Party hereto,
- 39 -
and is actually controlled or managed by such Party, but such
corporation, company or other entity shall be deemed to be a
Subsidiary only so long as such ownership or control of equity
interest, and actual control or management, exists.
1.9.3. For the purposes of this License, the Parties agree that the
Microsoft Network and any other mutually agreed less than
majority owned affiliates listed in Exhibit A as may be
amended from time to time, shall each constitute a Subsidiary
of Microsoft so long as Microsoft maintains at least a twenty-
percent (20%) ownership interest in the entity.
1.10. Patent Date shall mean the fifth anniversary of the Effective Date
or the date of early termination under Section 10 of the License,
Development and Marketing Agreement, which ever is earlier.
2. GRANTS
------
2.1. Microsoft to Citrix
2.1.1. Microsoft, on behalf of itself and its Subsidiaries, grants
Citrix a worldwide, nonexclusive, [CONFIDENTIAL TREATMENT
REQUESTED]/*/ , non-transferable (except as provided in
Section 9) license under any of Microsoft's Subject Patents
to practice any right under such patents including the right
to make, use, sell, offer for sale or import, to commercially
exploit; to have made, to promulgate any specification
related to, to provide any service, or to test any Citrix
Products.
2.1.2. A Combination Product is licensed under a claim of a
Microsoft Subject Patent only to the extent that there would
not have been infringement (direct or indirect) of such claim
by the non-Citrix components of the Combination Product but
for the combination of the third party Product with the
Citrix Product. The fact that a Combination Product is
unlicensed under any claim shall not limit, restrict or
otherwise affect the license granted to the Citrix Product
included in the Combination Product. Notwithstanding the
foregoing, a Combination Product that is a Foundry Product or
Clone Product is not licensed under this License.
2.1.3. Except to the extent necessary to allow Citrix and its
Subsidiaries as described in Section 2.3, to conduct the
sale, commercial exploitation, lease, license or other
transfer of a Citrix Product, this license does not include a
right to grant a sublicense to any of Microsoft's Subject
Patents.
2.1.4. In the case of those Microsoft Subject Patents licensable
hereunder only upon payment of a license fee from Microsoft
to a third party, Citrix shall be responsible for payment of
such fees, and Citrix' license hereunder
- ----------------------------
/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
- 40 -
shall be at Citrix' request and option and subject to payment
of such fees and to any other applicable restrictions of the
third party licensor.
2.2. Citrix to Microsoft
2.2.1. Citrix, on behalf of itself and its Subsidiaries,. grants
Microsoft a worldwide, nonexclusive, [CONFIDENTIAL TREATMENT
REQUESTED]/*/ , non-transferable (except as provided in
Section 9) license under any of Citrix' Subject Patents to
practice any right under such patents including the right to
make, use, sell offer for sale or import, to have made, to
commercially exploit, to promulgate any specification related
to, to provide any service, or to test any Microsoft
Products.
2.2.2. A Combination Product is licensed under a claim of a Citrix
Subject Patent only to the extent that there would not have
been infringement (direct or indirect) by the non-Microsoft
component of the Combination Product but for the combination
of the third party Product with the Microsoft Product. The
fact that a Combination Product is unlicensed under any claim
shall not limit, restrict or otherwise affect the license
granted to the Microsoft Product included in the Combination
Product. Notwithstanding the foregoing, a Combination Product
that is a Foundry Product or Clone Product is not licensed
under this License.
2.2.3. Except to the extent necessary to allow Microsoft and its
Subsidiaries as described in Section 2.3, to conduct the
sale, commercial exploitation, lease, license or other
transfer of a Microsoft Product, this license does not
include a right to grant a sublicense to any of Citrix'
Subject Patents.
2.2.4. In the case of those Citrix Subject Patents licensable
hereunder only upon payment of a license fee from Citrix to a
third party, Microsoft shall be responsible for payment of
such fees, and Microsoft's license hereunder shall be at
Microsoft's request and option and subject to payment of such
fees and to any other applicable restrictions of the third
party licensor.
2.3. Subsidiaries: The licenses granted by each Party in Sections 2.1 and
2.2 shall include the right of the Parties to grant the benefit of
such licenses to their respective Subsidiaries. To obtain such
benefit, the Subsidiary shall be bound by the terms and conditions of
this License as if it were named herein in place of the Parties. If a
Subsidiary ceases to be a Subsidiary during the term of this License
and holds any Subject Patents under which a Party hereto has been
granted a license, such license will continue for the life of such
Subject Patents. The right to any other licenses shall terminate on
the date such Subsidiary ceases to be a Subsidiary. The license
granted to the Subsidiary under Section 2 becomes a limited license
under the other Party's Subject Patents, issued or issuing from
- ----------------------------
/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
- 41 -
patent applications having a first effective filing date on or before
the date the Subsidiary ceases to be a Subsidiary, to exercise the
rights granted in Section 2 with respect to Products identical with
those Subsidiary Products licensed under Section 2 and commercialized
(released) prior to the date the Subsidiary ceases to be a
Subsidiary. All other licenses and rights granted to the Subsidiary
under this License shall terminate and shall not inure to the benefit
of the Subsidiary.
3. RELEASE
-------
3.1. Microsoft to Citrix: Microsoft, on behalf of itself and its
Subsidiaries, grants to Citrix and its Subsidiaries, including all
officers, agents and employees (personally and as representatives of
the company), and their respective customers (including licensees),
an irrevocable, perpetual release from all claims of infringement of
any of the rights of Microsoft's Subject Patents, with respect to
Citrix Products made, used, or sold by Citrix or its Subsidiaries
before the Effective Date of this License to the extent that such
Citrix Product would have been the subject of any license hereunder
had it been made, used, or sold after the Effective Date of this
License.
3.2. Citrix to Microsoft: Citrix, on behalf of itself and its
Subsidiaries, grants to Microsoft and its Subsidiaries, including all
officers, agents and employees (personally and as representatives of
the company), and their respective customers (including licensees),
an irrevocable, perpetual release from all claims of infringement of
any of the rights of Citrix' Subject Patents, with respect to
Microsoft Products made, used, or sold by Microsoft or its
Subsidiaries before the Effective Date of this License to the extent
that such Microsoft Product would have been the subject of any
license hereunder had it been made, used, or sold after the Effective
Date of this License.
3.3. Subsidiary: The term Subsidiary, in this Section 3.1 and 3.2 refers
only to those Subsidiaries that are Subsidiaries of one of the
Parties as of the Effective Date. The releases contained in Sections
3.1 and 3.2 shall not apply to any Person other than those specified
in this Section 3.
4. EXCLUSION OF OTHER RIGHTS
-------------------------
4.1. No license is granted herein by or to either Party, with respect to
any copyrights, mask work rights, trade secrets, know-how,
trademarks, trade names or similar industrial or intellectual
property rights. Neither Party is required hereunder to furnish or
disclose to the other any technical or other information.
4.2. Nothing contained in this License shall be construed to confer any
right to use in advertising, publicity, or other promotional
activities any trademark or trade name owned by the other Party. Each
Party agrees not to use or refer to this License or any provision
thereof in any promotional activity associated with products subject
to a license hereunder, without express written approval of the other
Party.
- 42 -
5. WARRANTY
--------
5.1. Each Party warrants that it has the full right and power to grant the
license and release set forth in Sections 2 and 3, and that there are
no outstanding agreements, assignments or encumbrances inconsistent
with any provisions of this License. Neither Party makes any other
warranties, express or implied, nor does either Party assume any
liability with respect to any infringement of patents or other rights
of third parties owing to the other Party's operation under the
license granted herein.
5.2. Nothing contained in this License shall be construed as a warranty or
representation by either Party as to the validity or scope of any of
its Subject Patents.
6. CONFIDENTIALITY
---------------
The terms of this License shall be kept in confidence by the Parties, and
shall not be disclosed except as may be required by law. The existence of
the License will be disclosed only as mutually agreed between the Parties
in writing. Further, if a specific request for information relevant to this
License is received from a third party who is a licensee of a Product from
one Party and who is also threatened with a claim of infringement by the
other Party, the pertinent terms of Sections 1, 2 and 3 can be disclosed
after notice is given to the other Party in writing.
7. TERM AND TERMINATION
--------------------
The term of this License shall be from the Effective Date until the
expiration of the last to expire of the Subject Patents.
8. LIMITATION OF LIABILITY
-----------------------
Neither Party shall be liable for any consequential, incidental, special,
or punitive damages arising out of or related to this License even if a
Party has been advised of the possibility of such damages.
9. ASSIGNMENT AND TRANSFER OF PATENT RIGHTS
----------------------------------------
Any sale or other transfer of, or assignment or grant of any right under, a
Subject Patent by a Party shall be subject to the rights and licenses
granted in this License to the other Party. Neither Party shall assign or
otherwise transfer any of its rights or privileges under this License,
including the patent licenses granted hereunder, to any third party under
action of law or otherwise, including without limitation in connection with
any acquisition of a Party by a third party (including without limitation
by merger, sale of stock, or otherwise) or in connection with the
insolvency or bankruptcy of either of the Parties, without the prior
written consent of the other Party. Any attempted assignment in derogation
of the foregoing shall be void.
- 43 -
10. OTHER TERMS
-----------
10.1. No Implied Limitations: Nothing contained in this License shall be
construed to limit the rights which the Parties have outside the
scope of the license granted hereunder, or restricting the rights
of either Party or any of its Subsidiaries to make, have made, use,
lease, license, sell or otherwise dispose of any particular
Products not subject to the License.
10.2. No Obligation to Obtain or Maintain Patents: No part of this
License shall be construed to require any Party to file any patent
application, secure any patent, maintain any patent in force,
provide copies of patent applications or patents to the other Party
or disclose any inventions described or claimed in such patents or
patent applications. However, each Party shall require its
respective employees, contractors and other persons working for the
Party, to exclusively assign to the Party the entire right, title
and interest in and to any patentable inventions that are conceived
of, developed, or reduced to practice during the period of time
that the employees or contractors are working for the Party.
10.3. No Obligation to Enforce Patents: No part of this License shall be
construed to require any Party to institute any action or suit
against third parties for infringement of any of its Subject
Patents or to defend any action or suit brought by a third party
challenging or concerning the validity of any of its Subject
Patents. In addition neither Party shall have any right to
institute any action or suit against third parties for infringement
of any of the other Party's Subject Patents.
10.4. Notices and Requests: All notices, authorizations, and requests
required or desired to be given or made in connection with this
License will be in writing, given by certified or registered mail
(return receipt requested), express air courier (charges prepaid),
or facsimile and addressed as follows (or to such other address as
the Party to receive the notice or request so designates by notice
to the other):
MICROSOFT:
Microsoft Corporation
One Microsoft Way
Redmond, Washington 98052-6399
Facsimile:(206) 936-7329
Attention: Group Vice President, Platforms
Attention: Legal
With a copy to the same address, Attention: Law and Corporate
Affairs; Facsimile:(206) 936-7409.
- 44 -
CITRIX:
Citrix Systems, Inc.
6400 NW 6th Way
Fort Lauderdale, Florida 33309
Facsimile: President
Attention: General Counsel
If a notice is given by either Party by certified or registered
mail, it will be deemed received by the other Party on the third
business day following the date on which it is deposited for
mailing. If a notice is given by either Party by air express
courier, it will be deemed received by the other Party on the next
business day following the date on which it is provided to the air
express courier. If a notice is given by facsimile, it will be
deemed received by the other Party after confirmation of receipt.
10.5. Controlling Law: This License will be construed under and controlled
by the laws of the State of Washington.
10.6. Attorneys' Fees: If Microsoft or Citrix retains outside counsel to
enforce any rights arising out of or relating to this License, the
prevailing party will be entitled to recover the reasonable fees,
costs and other expenses of such counsel from the other party.
10.7. Relationship of Parties: This License will not be construed as
creating a partnership, joint venture or agency relationship, or as
granting a franchise as defined in the Washington Franchise
Investment Protection Act, RCW 19. 100, as amended, or 16 CFR
Section 436.2(a).
10.8. Waiver: No waiver of any breach of any provisions of this License
will constitute a waiver of any prior, concurrent or subsequent
breach of the same or any other provisions hereof and no waiver will
be effective unless made in writing and signed by an authorized
representative of the waiving Party.
10.9. Section Headings: The section headings used in this License are
intended for convenience only and will not be deemed to supersede or
modify any provisions.
10.10. Counterparts: This License may be executed in one or more
counterparts, each of which will be deemed to be an original, but
all of which together will constitute one and the same instrument.
10.11. Severability: In the event that any provision contained in this
license should, for any reason, be held to be invalid or
unenforceable in any respect under the laws of any state or of the
United States, the Parties shall negotiate in good faith to revise
- 45 -
the terms of this License in order to adjust for the invalidity or
unenforceability of such provision.
10.12. Entire Agreement: This License does not constitute an offer by
either Party and will not be effective until signed by both Parties.
Upon execution by both Parties, this License will constitute the
entire agreement between the Parties with respect to the subject
matter hereof and merges all prior and contemporaneous
communications. It will not be modified except by a written
agreement signed on behalf of the Parties by their respective duly
authorized representatives. Unless agreed to in a separate writing
signed by both Parties, any statement appearing as a restrictive
endorsement on a check or other document which purports to modify a
right, obligation or liability of either Party will be of no force
and effect.
IN WITNESS OF, the Parties hereto have caused this License to be signed so as to
be effective as of the effective date set forth above.
MICROSOFT CORPORATION
By: /s/ Paul Maritz
-------------------------
Title: Group Vice President
----------------------
Date: May 9, 1997
-----------------------
CITRIX SYSTEMS, INC.
By: /s/ Edward E. Iacobucci
--------------------------
Title: Chairman
-----------------------
Date: May 9, 1997
------------------------
- 46 -
Exhibit G
Hydrix Product Support
----------------------
The Technical Coordinators acknowledge that the optimal support structure will
be different for Hydrix 4.0 and Hydrix 5.0. The Technical Coordinators will
prepare a support plan for each Hydrix release and present such plan for
acceptance by the Named Executives as a revised Exhibit G to this Agreement.
In general, Citrix will provide technical bug-fix support to Microsoft for
Hydrix 4.0 and responses to priority requests for problem assistance with regard
to unmodified portions of Hydrix shall be provided within the following
escalation guidelines:
Priority 1: [CONFIDENTIAL TREATMENT REQUESTED]/*/
- ----------
Priority 2: [CONFIDENTIAL TREATMENT REQUESTED]/*/
- ----------
Priority 3: [CONFIDENTIAL TREATMENT REQUESTED]/*/
- ----------
- ----------------------------
/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
- 47 -
Exhibit H
---------
Designated Companies
[CONFIDENTIAL TREATMENT REQUESTED]/*/
- ---------------------------
/*/ [CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.