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EXHIBIT 10.6
INTELLECTUAL PROPERTY RIGHTS AGREEMENT
by and between
NORTEL NETWORKS LIMITED,
NORTEL NETWORKS, INC.,
and
ARRIS INTERACTIVE, L.L.C.
Dated as of August 3, 2001
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INTELLECTUAL PROPERTY RIGHTS AGREEMENT
This Intellectual Property Rights Agreement (this "IPR Agreement"),
dated as of August 3, 2001, is by and between NORTEL NETWORKS LIMITED, a
corporation organized under the laws of Canada ("Nortel Networks"), on its
behalf, on behalf of NORTEL NETWORKS INC., a corporation organized and existing
under the laws of Delaware ("NNI"), and on behalf of its other wholly owned
subsidiaries (hereinafter collectively "Nortel Networks"), and ARRIS
INTERACTIVE, L.L.C., a limited liability company organized under the laws of
Delaware ("Existing Venture").
WITNESSETH:
WHEREAS pursuant to the Intellectual Property Rights Agreement
effective November 17, 1995 among ANTEC Corporation, Nortel Networks Inc. (a
wholly owned subsidiary of Nortel Networks) and Existing Venture, as amended by
the Agreement dated February 27, 1998 among ANTEC Corporation, Nortel Networks
Inc. and Existing Venture, and by the Amendment to Intellectual Property Rights
Agreement dated March 31, 1999 among ANTEC Corporation, Nortel Networks, Nortel
Networks Inc. and Existing Venture, the respective parties had defined their
rights and obligations with respect to certain joint development activities; and
WHEREAS pursuant to the License Agreement entered into November 17,
1995 between Nortel Networks Inc. and Existing Venture, as amended by the
Agreement dated February 27, 1998 among ANTEC Corporation, Nortel Networks Inc.
and Existing Venture, and by the Amendment to License Agreement dated March 31,
1999 among Nortel Networks, Nortel Networks Inc. and Existing Venture, Nortel
Networks and Nortel Networks Inc. granted Existing Venture certain license
rights under Intellectual Property Rights in Cornerstone Total Access, Voice and
Data and BTD Cable Modem products; and
WHEREAS, pursuant to the Agreement and Plan of Reorganization (the
"Merger Agreement") in which Nortel Networks LLC is to contribute all of its
interest in Existing Venture to Broadband Parent Corporation ("Newco") and,
accordingly, after the contribution, Newco is to own or control, directly or
indirectly, 100% of the interest in Existing Venture; and
WHEREAS Existing Venture seeks to have ownership of certain
Intellectual Property Rights of Nortel Networks, and to modify certain
Intellectual Property Rights it had licensed from Nortel Networks and Nortel
Networks Inc., and Nortel Networks and Nortel Networks Inc. are willing to grant
such ownership and modifications subject to the terms and conditions hereof.
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements contained herein, and intending to be
legally bound hereby, the parties agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
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1.01 Certain Definitions. As used herein, unless otherwise defined
below, capitalized terms have the meaning ascribed to them in the Merger
Agreement:
"Administrative Services" means any financial, human resources, sales
and marketing, order management, bills of materials, logistics, customs/excise,
information systems, or administrative process or services, including any
computer software used in connection therewith, supplied to Existing Venture by
or on behalf of Nortel Networks or any of its Affiliates.
"Affiliate" shall mean a company which Nortel Networks effectively owns
or controls, and continues to own or control, directly or indirectly, fifty
percent (50%) or more of the voting stock or ownership interest therein, and
shall include its parent Nortel Networks Corporation and its Affiliates.
"Existing Venture" shall have the meaning set forth in the first
paragraph of this Agreement.
"Existing Venture Company" shall mean any of Existing Venture, ANTEC
Corporation and Newco, and "Existing Venture Companies" shall mean all of
Existing Venture, ANTEC Corporation and Newco.
"Existing Venture Intellectual Property Rights" means all of the
Intellectual Property Rights that are owned by Existing Venture as at the
Effective Time, a complete list of which is attached hereto as Schedule A.
"Existing Venture Products" shall mean those products of Existing
Venture, in existence as at the Effective Time, identified on Schedule B,
attached hereto.
"Existing Venture Royalty Products" shall mean those products and
services of a Licensed Existing Venture Company which embody Licensed
Intellectual Property Rights, and which are (i) not natural improvements and
evolutions of Licensed Products, and/or (ii) not used in the delivery of
narrowband and broadband services over Hybrid Fiber Coaxial Cable Networks.
"CMTS IPR" shall mean those Transferred Intellectual Property Rights
that as of the Effective Time are (i) owned by Nortel Networks, and (ii) either
exclusively embodied in or exclusively used by the Existing Venture Product
known as CMTS, or exclusively used in the development, manufacture and sale of
CMTS.
"Competing Company" shall mean any of the companies listed in Schedule
C, attached hereto, and shall include any Person that directly, or indirectly
through one or more intermediaries, controls, is controlled by, or is under
common control with, such companies.
"Confidential Information" shall mean information disclosed from one
Party to the other which is marked "confidential" or "proprietary" or by words
of like import, or which because of
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its nature or the circumstances surrounding its disclosure would reasonably be
considered to be confidential.
"Copyrights" shall have the meaning set forth in the definition of
Intellectual Property Rights.
"Excluded Intellectual Property" means Intellectual Property Rights
embodied in or related to Administrative Services, Arris Hardware, Common
Equipment Hardware, Proprietary Hardware, or Services (as defined in the
Transitional Services Agreement between the parties dated as of the effective
date first above written).
"Hybrid Fiber Coaxial Cable Network" shall mean a broadcast network
that combines coaxial cable and fiber optic cable (but not including all-fiber
or fiber-copper networks) in the delivery of services from headend to subscriber
premises.
"Improvements" shall mean improvements, innovations, enhancements,
modifications or derivative works by an Existing Venture Company to the Licensed
Intellectual Property Rights after the Effective Time.
"Intellectual Property Rights" shall mean all intellectual property
rights arising from or associated with the following, whether protected, created
or arising under the laws of the United States or any other jurisdiction: (A)
trade names, registered and unregistered trademarks and service marks, brand
names, internet domain names, and trade dress and rights, trade names, business
names, words, symbols, color schemes and other indications of origin, and all
applications (including intent to use applications) to register any of the
foregoing, and all goodwill associated with any of the foregoing (collectively,
"Trademarks"); (B) patents or models, industrial designs and all applications
therefor, including any and all continuation, divisional, provisional,
continuation-in-part, reexamination and reissue patent applications and their
extensions, and any patents issuing therefrom (collectively, "Patents"); (C)
trade secrets, knowhow and other confidential or non-public business
information, including ideas, formulas, compositions, inventions, inventors'
certificates, invention disclosures, discoveries and improvements, know-how,
manufacturing and production processes and techniques, and research and
development information; drawings, specifications, plans, proposals and
technical data; financial, marketing and business data, pricing and cost
information; business and marketing plans and customer and supplier lists and
information, including rights to limit the use or disclosure of confidential
information by any Person; in each case whether patentable, copyrightable or not
("Trade Secrets"); (D) computer programs, software, firmware and databases,
including the routines, subroutines, concepts, processes, algorithms, formulas,
ideas and know-how contained therein, and any corrections, "patches", updates,
upgrades or revisions thereto, and all documentation therefor, in each case
whether patentable, copyrightable or not (collectively, "Software"); (E)
copyrights and moral rights in writings and other works of authorship, including
marketing materials, brochures, training materials, and Software, including all
registrations and applications therefor (collectively, "Copyrights"); and (F)
mask work and similar rights, including rights created under Sections 901-914 of
Title 17 of the United States
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Code, including all registrations and applications to register any of the
foregoing, and any other rights protecting integrated circuit or chip
topographies or designs (collectively, "Mask Works").
"IPR Agreement" shall have the meaning set forth in the first paragraph
of this IPR Agreement.
"IPR Contracts" shall mean the contracts, purchase orders, agreements,
third party software licenses and other rights and obligations of Nortel
Networks and its Affiliates relating to the Transferred Intellectual Property
Rights which are to be assumed by Existing Venture, all of which are listed in
Schedule D attached hereto;
"Licensed Intellectual Property Rights" shall mean those Intellectual
Property Rights owned by Nortel Networks and embodied in, used by, or used in
the development, manufacture, and sale of, Existing Venture Products as of the
Effective Time, as identified in Schedule B, but shall not include any
Trademarks owned by Nortel Networks, Transferred Intellectual Property Rights or
Excluded Intellectual Property Rights, and shall include, without limitation,
those Intellectual Property Rights listed in Schedule E, attached hereto.
"Licensed Products" means Existing Venture Products and natural
improvements and evolutions thereof used in the delivery of narrowband and
broadband services over Hybrid Fiber Coaxial Cable Networks.
"Nortel Networks" shall have the meaning set forth in the first
paragraph of this Agreement.
"Arris Hardware" shall have the same meaning as the term "Arris
Hardware" as set forth in the Purchase and Sale Agreement between the parties
dated as of the effective date first above written.
"Common Equipment Hardware" shall have the same meaning as the term
"Common Equipment Hardware" as set forth in the Purchase and Sale Agreement
between the parties dated as of the effective date first above written.
"Proprietary Hardware" shall have the same meaning as the term
"Proprietary Hardware" as set forth in the Purchase and Sale Agreement between
the parties dated as of the effective date first above written.
"Nortel Networks LLC" shall have the meaning set forth in the first
paragraph of this Agreement.
"Nortel Networks Royalty Products" shall mean those products and
services of Nortel Networks or its Affiliates which embody Transferred
Intellectual Property Rights or Existing Venture Intellectual Property Rights,
other than CMTS IPR, and which provide substantially identical functionality as
that provided by the Existing Venture Products.
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"Party" shall mean either of Nortel Networks or Existing Venture, and
"Parties" shall mean both Nortel Networks and Existing Venture.
"Patents" shall have the meaning set forth in the definition of
Intellectual Property Rights.
"Software" shall have the meaning set forth in the definition of
Intellectual Property Rights.
"Trade Secrets" shall have the meaning set forth in the definition of
Intellectual Property Rights.
"Trademarks" shall have the meaning set forth in the definition of
Intellectual Property Rights.
"Transferred Intellectual Property Rights" means the Transferred
Patents, the Transferred Trademarks and the Transferred Other IPR, a complete
list of which is attached hereto as Schedule F.
"Transferred Other IPR" means the Intellectual Property Rights, other
than Patents and Trademarks that are listed under the heading "Transferred Other
IPR" in Schedule F attached hereto.
"Transferred Patents" means the Patents that are listed under the
heading "Transferred Patents" in Schedule F attached hereto.
"Transferred Trademarks" means the Trademarks that are listed under the
heading "Transferred Trademarks" in Schedule F attached hereto, and all goodwill
associated therewith.
ARTICLE II
INTELLECTUAL PROPERTY TRANSFERS
2.01 Transferred Intellectual Property. Subject to the terms and
conditions hereof, NNI hereby transfers, conveys and assigns to Existing
Venture, and Existing Venture hereby acquires, NNI's entire right, title and
interest in, to and under the Transferred Intellectual Property Rights. NNI
shall transfer all of its interest in the Transferred Intellectual Property
Rights by delivering to Existing Venture an executed assignment document and
thereafter delivering to Existing Venture such other documents (including patent
prosecution files) as Existing Venture may reasonably request to effect the
transfer and the registration thereof, within 120 days after the Closing Date.
2.02 Excluded Assets. All other Intellectual Property Rights,
technology, real property, personal property, agreements and all other assets
owned, leased or otherwise possessed by Nortel Networks are specifically
excluded from the Transferred Intellectual Property Rights and any contribution
or acquisition pursuant to this IPR Agreement.
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2.03 Non-Assignable IPR Contracts. This IPR Agreement and any
document delivered hereunder shall not constitute an assignment or an attempted
assignment of any IPR Contract contemplated to be assigned to Existing Venture
hereunder and:
(a) not assignable without the consent of a third Person
if such consent has not been obtained and such assignment or attempted
assignment would constitute a breach thereof; or
(b) in respect of which the remedies for the enforcement
thereof available to Nortel Networks would not pass to Existing Venture.
Nortel Networks shall use its commercially reasonable efforts to obtain such
consents of third Persons as may be necessary for the assignment of the IPR
Contracts, provided that Nortel Networks shall not be obliged to make any
payments to such third Persons in addition to those required to be made
thereunder in order to obtain such consents, unless Existing Venture reimburses
Nortel Networks for such payments at the time such payments are made. Existing
Venture shall cooperate in all reasonable respects with Nortel Networks to
obtain all such consents and to resolve all matters necessary to assign such IPR
Contracts to Existing Venture. The Parties shall execute and deliver a letter,
substantially in the form of Schedule G attached hereto, to all applicable third
Persons in order to either effect such assignments or to enter into new
arrangements between Existing Venture and the applicable third Person. To the
extent that, in the sole opinion of Nortel Networks, any of the foregoing items
are not assignable by the terms thereof or consents to the assignment thereof
cannot be obtained as herein provided, such items shall be held by Nortel
Networks for the benefit of Existing Venture and the covenants and obligations
thereunder shall be performed by Existing Venture in the name of Nortel Networks
and all benefits and obligations existing thereunder shall be for the account of
Existing Venture.
2.04 Assumed Liabilities. Upon and subject to the terms and
conditions hereof, at the Effective Time, Existing Venture shall assume and
become responsible for, and shall thereafter pay, perform, discharge and satisfy
the following obligations and liabilities (collectively, the "Assumed
Liabilities"):
(a) all obligations and liabilities under the IPR
Contracts required to be performed from and after the Effective Time; and
(b) all other obligations and liabilities relating to the
Transferred Intellectual Property Rights that arise or are incurred from and
after the Effective Time.
2.05 Excluded Liabilities. The Assumed Liabilities shall not
include, and Existing Venture shall not assume or become responsible for, any of
the following obligations or liabilities (collectively, the "Excluded
Liabilities"):
(a) all accounts payable in connection with the
Transferred Intellectual Property Rights as at the Effective Time; and
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(b) all obligations and liabilities relating to the
Transferred Intellectual Property Rights that were required to be performed
prior to the Effective Time,
provided that nothing in this Section 2.05 shall be construed to negate any
liability or obligation explicitly assumed by Existing Venture elsewhere in this
IPR Agreement.
2.06 Taxes. Existing Venture shall pay or cause to be paid all
sales and use taxes, privilege or other taxes, if any, which are based either on
the circumstances of transfer or on the value of any Transferred Intellectual
Property Rights that is to be sold or contributed by Nortel Networks pursuant
hereto that may be imposed on or in connection with the contributions,
conveyances, assignments, transfers and deliveries to be made hereunder by
Nortel Networks.
ARTICLE III
INTELLECTUAL PROPERTY LICENSES
3.01 Licensed Intellectual Property - Licensed Products. Subject to
the terms and conditions of this IPR Agreement, Nortel Networks hereby grants to
Existing Venture Companies a personal, non-assignable (except as permitted in
Section 3.03), royalty-free, fully paid-up, non-exclusive, world-wide license
under the Licensed Intellectual Property Rights to design, develop, manufacture,
use, reproduce, modify, perform, lease, sell, offer for sale and import Licensed
Products. Such right shall include the right to have Licensed Products designed
and developed by a third Person for the manufacture, use, sale or lease by
Existing Venture Companies, provided such third Person is not a Competing
Company. Furthermore, such right shall also include the right to have such
Licensed Products made by a third Person for the use, sale or lease by Existing
Venture Companies, but only when both of the following conditions are met:
(a) the designs, specifications and working drawings for
the manufacture of said Licensed Products are furnished by Existing Venture
Companies; and
(b) said designs, specifications and working drawings are
in sufficient detail that no material modification by the manufacturer is
required other than (i) adaptation to the production processes and standards
normally used by the manufacturer which changes the characteristics of the
Licensed Products only to a negligible extent, or (ii) as required by the
manufacture to lower the overall cost per product.
3.02 Existing Venture Companies shall be entitled to grant
sublicenses under the Software and Copyrights of the Licensed Intellectual
Property Rights to distributors and end users of Licensed Products solely to the
extent necessary to permit the distribution and use of such Licensed Products,
provided that Existing Venture Companies shall enter into enforceable sublicense
agreements with each such sublicensee under which the sublicensee acquires no
right, title or interest in any of the Licensed Intellectual Property Rights
other than the right to use and copy the subject matter thereof as necessary for
the distribution and use of such Licensed Products, and agrees to be bound by
the confidentiality provisions set forth in Article 4 hereof.
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3.03 The license granted to Existing Venture Companies in Section
3.01 shall include the right to grant sublicenses within the scope of such
license to Subsidiaries of Existing Venture Companies, but, except as provided
in Section 3.02 and this Section 3.03, shall otherwise be non-sublicenseable,
non-transferable and non-assignable except in conjunction with the subsequent
sale of all or substantially all of the business of the design, development,
manufacture, lease and sale of Licensed Products, in which case Existing Venture
Companies shall be entitled to assign all of its rights under Sections 3.01 and
3.02 to the assignee of the such business provided that:
(a) Existing Venture Companies shall provide prior
written notice to Nortel Networks of any such assignment;
(b) The licenses in Sections 3.01 and 3.02 will be
restricted to Licensed Products, and shall not extend to any other products or
services of such assignee;
(c) such assignee shall agree in writing to assume all
obligations of Existing Venture Companies hereunder and to strictly comply with
the terms of this IPR Agreement;
(d) Existing Venture Companies shall not be relieved of
any of its obligations hereunder; and
(e) all rights of Existing Venture Companies (and any of
their Subsidiaries hereunder) shall terminate on the Effective Time of any such
assignment.
3.04 Licensed Intellectual Property - Existing Venture Royalty
Products. Subject to the terms and conditions of this IPR Agreement and upon
Nortel Networks' prior written consent, not to be unreasonably withheld, Nortel
Networks will grant to Existing Venture Companies a personal, non-assignable,
royalty-bearing, non-exclusive, world-wide license under the Licensed
Intellectual Property Rights to design, develop, manufacture, use, reproduce,
modify, perform, lease, sell, offer for sale and import Existing Venture Royalty
Products on reasonable, non-discriminatory terms and conditions. Furthermore,
such right shall also include the right to have Existing Venture Royalty
Products designed and developed by a third Person for the manufacture, use, sale
or lease by Existing Venture Companies, provided such third Person is not a
Competing Company. Such right will include the right to have such Venture
Royalty Products made by a third person for the use, sale or lease by Existing
Venture Companies, but only when both of the following conditions are met:
(a) the designs, specifications and working drawings for
the manufacture of said Venture Royalty Products are furnished by Existing
Venture Companies; and
(b) said designs, specifications and working drawings are
in sufficient detail that no material modification by the manufacturer is
required other than (i) adaptation to the production processes and standards
normally used by the manufacturer which changes the characteristics of the
Existing Venture Royalty Products only to a negligible extent, or (ii) as
required by the manufacture to lower the overall cost per product.
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3.05 Existing Venture Companies will be entitled to grant
sublicenses under the Software and Copyrights of the Licensed Intellectual
Property Rights to distributors and end users of Existing Venture Royalty
Products solely to the extent necessary to permit the distribution and use of
such Existing Venture Royalty Products, provided that Existing Venture Companies
shall enter into enforceable sublicense agreements with each such sublicensee
under which the sublicensee acquires no right, title or interest in any of the
Licensed Intellectual Property Rights other than the right to use and copy the
subject matter thereof as necessary for the distribution and use of such
Existing Venture Royalty Products, and agrees to be bound by the confidentiality
provisions set forth in Article 4 hereof.
3.06 The licenses granted to Existing Venture in Section 3.04 will
include the right to grant sublicenses within the scope of such license to
Subsidiaries of Existing Venture Companies, but, except as provided in Section
3.05 and this Section 3.06, shall otherwise be non-sublicenseable,
non-transferable and non-assignable unless explicitly provided for in the terms
of such licenses.
3.07 Transferred and Existing Venture Intellectual Property.
Subject to the terms and conditions of this IPR Agreement, NNI retains, and
Existing Venture agrees to allow NNI to retain, a personal, non-assignable
except to Affiliates, royalty-free, fully paid-up, non-exclusive, worldwide
license under the Transferred Intellectual Property Rights and the Existing
Venture Intellectual Property Rights, excluding those Transferred Intellectual
Property Rights and the Existing Venture Intellectual Property Rights which are
Trademarks, to design, develop, manufacture, use, reproduce, modify, perform,
lease, sell, offer for sale and import all products and services other than
Nortel Networks Royalty Products. Existing Venture hereby agrees to grant to
Nortel Networks and its Affiliates a personal, non-assignable, royalty-bearing,
non-exclusive, worldwide license under the Transferred Intellectual Property
Rights and the Existing Venture Intellectual Property Rights to design, develop,
manufacture, use, reproduce, modify, perform, lease, sell, offer for sale and
import Nortel Networks Royalty Products on reasonable, non-discriminatory terms
and conditions. Such licenses will include the right to have all products made
by another manufacturer for the use, lease or sale by Nortel Networks and its
Affiliates, but only when both of the following conditions are met:
(a) the designs, specifications and work drawings for the
manufacture of said products are furnished by Nortel Networks or its Affiliate;
and
(b) said designs, specifications and working drawings are
in sufficient detail that no material modification by the manufacturer is
required other than (i) adaptation to the production processes and standards
normally used by the manufacturer which changes the characteristics of the
products only to a negligible extent, or (ii) as required by the manufacture to
lower the overall cost per product.
3.08 Improvements. Subject to the terms and conditions of this IPR
Agreement, Existing Venture Companies hereby agree to grant to Nortel Networks
and its Affiliates a personal, non-assignable, royalty-bearing, non-exclusive,
worldwide license under Improvements to design, develop, manufacture, use,
reproduce, modify, perform, lease, sell, offer for sale and
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import products and services on reasonable, non-discriminatory terms and
conditions. Such license will include the right to have all products made by
another manufacturer for the use, lease or sale by Nortel Networks and its
Affiliates, but only when both of the following conditions are met:
(a) the designs, specifications and work drawings for the
manufacture of said products are furnished by Nortel Networks or its Affiliate;
and
(b) said designs, specifications and working drawings are
in sufficient detail that no material modification by the manufacturer is
required other than (i) adaptation to the production processes and standards
normally used by the manufacturer which changes the characteristics of the
products only to a negligible extent, or (ii) as required by the manufacture to
lower the overall cost per product.
3.09 Nortel Networks and its Affiliates shall be entitled to grant
sublicenses under the Software and Copyrights of the Transferred Intellectual
Property Rights, the Existing Venture Intellectual Property Rights, and
Improvements to distributors and end users of Nortel Networks' or its
Affiliates' products solely to the extent necessary to permit the distribution
and use of such products, provided that Nortel Networks or its Affiliate shall
enter into enforceable sublicense agreements with each such sublicensee under
which the sublicensee acquires no right, title or interest in any of the
Transferred Intellectual Property Rights, the Existing Venture Intellectual
Property Rights, and Improvements other than the right to use and copy the
subject matter thereof as necessary for the distribution and use of such
products, and agrees to be bound by the confidentiality provisions set forth in
Article 4 hereof.
3.10 The licenses granted to Nortel Networks and its Affiliates in
Sections 3.07 and 3.08 shall, except as provided in Sections 3.08, 3.09 and this
Section 3.10, be non-sublicenseable, non-transferable and non-assignable except
in conjunction with the subsequent sale of all or substantially all of Nortel
Networks' or its Affiliate's business related to such products, in which case
Nortel Networks or its Affiliate shall be entitled to assign all of its rights
under Sections 3.07 and 3.08 to the assignee of such business provided that:
(a) Nortel Networks or its Affiliate shall provide prior
written notice to Existing Venture of any such assignment;
(b) such assignee shall agree in writing to assume all
obligations of Nortel Networks and its Affiliates hereunder and to strictly
comply with the terms of this IPR Agreement;
(d) Nortel Networks and its Affiliates shall not be
relieved of any of its obligations hereunder; and
(e) all rights of Nortel Networks (and any of its
Affiliates hereunder) shall terminate on the Effective Time of any such
assignment.
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3.11 All patent and industrial design licenses granted herein shall commence
on the Effective Time and shall continue for the entire terms of the patents
(and their extensions) and industrial designs under which licenses are granted
subject to termination as provided herein. All other licenses granted hereunder
shall be perpetual, subject to termination as provided herein. Any sublicense
granted hereunder to an Affiliate or Subsidiary shall terminate on the date such
entity ceases to be an Affiliate or Subsidiary, as the case may be, unless
terminated earlier as provided herein.
3.12. License to CMTS IPR. Notwithstanding that CMTS IPR form part of
Transferred Intellectual Property Rights, NNI retains, and Existing Venture
agrees to allow NNI to retain, a royalty-free, non-exclusive license, with the
right to grant sublicenses under all CMTS IPR to a third Person. Provided that
if such third Person is ADC, Riverdelta, Riverstone, Cadant, Pacific Broadband,
Motorola, Cisco, Tellabs, NNI shall not have the right to sublicense the CMTS
IPR for use in the delivery of narrowband or broadband services over Hybrid
Fiber Coaxial Cable Networks nor the right to sublicense for non-Hybrid Fiber
Coaxial Cable Networks applications if such applications are available from
Existing Venture.
3.13 Supply License to Nortel Networks Components. Nortel Networks grants to
Existing Venture Companies a non-exclusive, royalty-free license under Nortel
Networks' Intellectual Property Rights embodied in, or used in the manufacture
of, Arris Hardware to make or have made Arris Hardware solely for use in the
manufacture and sale of Licensed Products by Existing Venture Companies subject
to the terms of the Purchase and Sale Agreement between the parties dated as of
the effective date first above written.
Nortel Networks grants to Existing Venture Companies a non-exclusive,
royalty-free license under Nortel Networks' Intellectual Property Rights
embodied in, or used in the manufacture of, Common Equipment Hardware to make or
have made Common Equipment Hardware solely for use in the manufacture and sale
of Licensed Products by Existing Venture Companies subject to the terms of the
Purchase and Sale Agreement between the parties dated as of the effective date
first above written.
At such time that Nortel Networks manufactures discontinues Proprietary
Hardware, Nortel Networks agrees to grant to Existing Venture Companies a
non-exclusive, royalty-free license under Nortel Networks' Intellectual Property
Rights embodied in, or used in the manufacture of, Proprietary Hardware to make
or have made Proprietary Hardware solely for use in the manufacture and sale of
Licensed Products by Existing Venture Companies subject to the terms of the
Purchase and Sale Agreement between the parties dated as of the effective date
first above written.
Existing Venture Companies hereby agrees to bear all reasonable costs incurred
by Nortel Networks related to locating, obtaining, compiling or otherwise
providing to Existing Venture Companies information, including specifications,
drawings, and other technical information, associated with the Common Equipment
Hardware and the Proprietary Hardware.
3.14 Packetport. Notwithstanding the licenses granted under Section
3.01 and that Licensed Products include that Existing Venture Product known as
Packetport, for a period of
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twelve (12) months from the Effective Time Existing Venture Companies shall not,
without the express written consent of Nortel Networks, further develop, modify,
improve or evolve Packetport in such a manner that Packetport no longer supports
the standard quality of service and signaling requirements of either (i) Nortel
Networks' product known as Succession Call Server, or (ii) a widely-accepted
industry standard. Nothing in this Section 3.14 shall prohibit Existing Venture
Companies from further developing or modifying, Packetport (for example, so that
it is compatible with other vendors' products, or in order to reduce the cost
per unit), provided that during such twelve (12) month period Packetport
continues to support the standard quality of service and signaling requirements
of either (i) Nortel Networks' product known as Succession Call Server, or (ii)
a widely-accepted industry standard. Subject to the foregoing, but
notwithstanding Section 3.04, Nortel Networks hereby grants to Existing Venture
Companies a personal, non-assignable, royalty-free, fully-paid, non-exclusive,
world-wide license under the Licensed Intellectual Property Rights embodied in
Packetport to design, develop, manufacture, use, reproduce, modify, perform,
lease, sell, offer for sale and import natural improvements or evolutions of
Packetport (whether or not used in Hybrid Fiber Coaxial Cable Networks) based on
established design specifications for CPE devices which are compatible with
Nortel Networks' Fiber-to-the-Home products. The licenses granted in this
Section 3.14 shall include the right to have such evolutions of Packetport
designed and developed by a third Person for the manufacture, use, sale or lease
by Existing Venture Companies, provided such third Person is not a Competing
Company. Furthermore, such right shall also include the right to have such
evolutions of Packetport made by a third Person for the use, sale or lease by
Existing Venture Companies, but only when all of the following conditions are
met
(a) the designs, specifications and working drawings for
the manufacture of such products are furnished by Existing Venture Companies;
and
(b) said designs, specifications and working drawings are
in sufficient detail that no material modification by the manufacturer is
required other than (i) adaptation to the production processes and standards
normally used by the manufacturer which changes the characteristics of such
products only to a negligible extent, or (ii) as required by the manufacture to
lower the overall cost per unit; and
(c) any Software embodied in such evolutions of
Packetport is furnished to the manufacturer in object code only.
All Intellectual Property Rights, excluding Patents, that as of the Effective
Time are (i) owned by Nortel Networks, and (ii) either exclusively embodied in
or exclusively used by Packetport, or exclusively used in the development,
manufacture and sale of Packetport (the "Transferred Packetport IPR"), will
become Transferred Intellectual Property effective twelve (12) months from the
Effective Time. At the same time, Nortel Networks will grant Existing Venture
Companies a royalty-free, non-exclusive license, with the right to grant
sublicenses, under any Patents that as of the Effective Time are owned by Nortel
Networks and embodied in, or used by Packetport, or are used in the development,
manufacture and sale of Packetport, solely to make, use and sell Packetport and
natural improvements and evolutions thereof. Also at the same time,
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Existing Venture Companies will grant Nortel Networks and its Affiliates an
unrestricted, royalty-free, non-exclusive license, with the right to grant
sublicenses, under all Transferred Packetport IPR, and under all improvements,
innovations, enhancements, modifications or derivative works of Transferred
Packetport IPR created by Existing Venture Companies during the previous twelve
(12) months. During the twelve (12) months prior to the transfer of the
Packetport IPR, Nortel Networks shall use reasonable efforts to consult with
Existing Venture prior to sublicensing of the Packetport IPR and any royalty
rights received by Nortel Networks from the sublicensing of Packetport IPR for
use in the delivery of narrowband or broadband services over Hybrid Fiber
Coaxial Cable Networks shall be assigned to Existing Venture.
3.15 Subject to the terms and conditions of this IPR Agreement,
Nortel Networks hereby grants to Existing Venture Companies a royalty-free,
perpetual, fully paid-up, non-exclusive, fully sublicensable, world-wide license
under the following four patent disclosures, and any patents issuing thereon,
identified on Schedule E, Licensed Intellectual Property Rights: BA0199,
12329HU, 14195RG, and 14300RG.
3.16 For any patent disclosure identified on Schedule E, Licensed
Intellectual Property Rights, for which Nortel Networks, after 12 months after
the respective submission date of such disclosure, has not initiated preparation
of a patent application, or for any filed patent application on Schedule E for
which Nortel Networks chooses not to continue prosecuting for reasons unrelated
to patentability, Nortel Networks shall assign such patent disclosure or patent
application, respectively, to Existing Venture Companies, subject to Nortel
Networks retention of a royalty-free, perpetual, fully paid-up, non-exclusive,
fully sublicensable, world-wide license to any patents issuing from such patent
disclosure or patent application.
ARTICLE IV
CONFIDENTIAL INFORMATION
4.01 The Parties acknowledge that the subject matter of the
Licensed Intellectual Property Rights, the Transferred Intellectual Property
Rights, the Existing Venture Intellectual Property Rights and the Improvements
include Confidential Information that is proprietary to and constitutes trade
secrets of the respective owners of such Intellectual Property Rights.
Accordingly, for a period of ten (10) years after the Effective Time, the
receiving Party shall hold such Confidential Information in confidence for the
disclosing Party and only make use of, or disclose it in accordance with the
provisions of this Article 4.
4.02 The receiving Party shall hold secret and not disclose to any
Person (except to such of its own employees and permitted sublicensees as are
required to use the Confidential Information in the course of exploiting its
license rights hereunder, and then only under an obligation of secrecy binding
upon such employees or sublicensees) any of the Confidential Information, except
as follows:
(a) as is reasonably necessary in the provision of
procurement specifications to suppliers for the procurement by the receiving
Party and permitted sublicensees of materials, parts, components and assemblies
for use in the manufacture, use and sale of products and
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services as licensed herein and as reasonably necessary to enable end users of
such products and services to operate and maintain them, provided, in each case,
such persons agree to be bound by the confidentiality provisions of this Article
4; and
(b) to the extent the Confidential Information: (i)
becomes available to the public from a source other than the receiving Party;
(ii) is obtained by the receiving Party without restrictions on use or
disclosure from a third Person who did not receive it, directly or indirectly,
from the disclosing Party; (iii) is documented as being known to the receiving
Party prior to its disclosure by the disclosing Party; or (iv) is documented as
being independently developed by the receiving Party without reference to the
Confidential Information.
4.03 The receiving Party and its permitted sublicensees shall not
make or have made or permit to be made, any copies of the Confidential
Information except those copies which are necessary for the exercise of the
rights granted hereunder, and all such copies shall, upon reproduction by the
receiving Party and its permitted sublicensees and whether or not in the same
form or format as the Confidential Information, contain the same proprietary and
confidentiality notices or legends which appear on the disclosing Parties'
Confidential Information provided pursuant to this IPR Agreement.
4.04 The receiving Party and its permitted sublicensees shall use
the same degree of care as is used to protect their own confidential information
of a similar nature, but no less than reasonable care, to prevent the
unauthorized use, dissemination or publication of the Confidential Information.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
5.01 Save and except as set out in Schedule H attached hereto,
Nortel Networks has no Knowledge of any other agreement, written or oral,
relating to Intellectual Property Rights, that is material to the use and
enjoyment of the Transferred Intellectual Property Rights. Save and except as
set out in Schedule H attached hereto, Nortel Networks has no Knowledge of any
outstanding claims, or threatened claims, made in writing during the past two
years that any of the Transferred Intellectual Property Rights infringes any
Intellectual Property Right of any third Person.
5.02 EXCEPT AS PROVIDED IN SECTION 5.01, NO PARTY MAKES, AND THERE
ARE NO WARRANTIES, REPRESENTATIONS OR CONDITIONS, EXPRESS OR IMPLIED, STATUTORY
OR OTHERWISE RELATING TO THE TRANSFERRED INTELLECTUAL PROPERTY RIGHTS, THE
LICENSED INTELLECTUAL PROPERTY RIGHTS, THE EXISTING VENTURE INTELLECTUAL
PROPERTY RIGHTS, OR THE IMPROVEMENTS, OR TO THIS IPR AGREEMENT. THE PARTIES
EXPRESSLY EXCLUDE ANY WARRANTIES, CONDITIONS OR REPRESENTATIONS OF
MERCHANTABILITY, NON-INFRINGEMENT, OR FITNESS FOR ANY PARTICULAR PURPOSE.
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5.03 IN NO EVENT SHALL ANY PARTY, ITS AGENTS OR EMPLOYEES, BE
LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES,
INCLUDING, WITHOUT LIMITATION, LOST PROFITS, LOST DATA, OR LOST SAVINGS, IN
CONNECTION WITH THIS IPR AGREEMENT OR THE TRANSFERRED INTELLECTUAL PROPERTY
RIGHTS, THE LICENSED INTELLECTUAL PROPERTY RIGHTS, THE EXISTING VENTURE
INTELLECTUAL PROPERTY RIGHTS, OR THE IMPROVEMENTS, HOWSOEVER CAUSED, WHETHER
ARISING IN CONTRACT (INCLUDING FUNDAMENTAL BREACH), TORT (INCLUDING NEGLIGENCE)
OR OTHERWISE.
5.04 Without limiting the generality of Section 5.02, nothing
contained in this IPR Agreement shall be construed as:
(a) requiring the filing of any patent application or
application to register any industrial design, the securing of any patent or
industrial design, or the maintaining of any patent or industrial design in
force;
(b) a warranty or representation by the licensor, or an
admission by the licensee, as to the validity or scope of any of the Licensed
Intellectual Property Rights, Transferred Intellectual Property Rights, Existing
Venture Intellectual Property Rights or Improvements;
(c) a warranty or representation that any manufacture,
development, sale, lease, use or importation will be free from infringement of
third party patents or other intellectual property rights;
(d) an agreement to bring or prosecute actions or suits
against third parties for infringement or misappropriation;
(e) an obligation to furnish any assistance or any
technical information under this IPR Agreement;
(f) conferring any right to use, in advertising,
publicity or otherwise, any name, trade name or trade mark, or any contraction,
abbreviation or simulation thereof; or
(g) conferring by implication, estoppel or otherwise upon
any Party any license or other right under any patent or other Intellectual
Property Right, except the licenses and rights expressly granted herein.
ARTICLE VI
TERMINATION
6.01 If within nine (9) months of the Effective Time a Competing
Company has entered into an agreement under which it will acquire the right,
either directly or indirectly, to elect or appoint a majority of the members of
the board of any Existing Venture Company, the
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licenses granted to Existing Venture Companies under Sections 3.01, 3.02, 3.03,
3.04, 3.05, 3.06 and 3.14 shall immediately terminate.
ARTICLE VII
MISCELLANEOUS
7.01 Counterparts. This IPR Agreement may be executed in one or
more counterparts, each of which when executed shall be deemed to constitute an
original but all of which when taken together shall constitute one and the same
instrument.
7.02 Governing Law. This IPR Agreement shall be governed by, and
interpreted in accordance with, the laws of the Province of Ontario, Canada,
without regard to the conflict of law principles thereof.
7.03 Assignment; Change of Control. Except as set forth previously,
Existing Venture shall not assign or transfer this IPR Agreement, in whole or in
part, whether by merger, operation of law or otherwise without the prior written
consent of Nortel Networks. Except as may be contemplated in the Ancillary
Agreements, any change of control of Existing Venture shall be deemed to
constitute an assignment for the purposes of this Section.
7.04 Expenses. Except as otherwise provided herein, each Party
hereto will bear all expenses incurred by it in connection with this IPR
Agreement and the transactions contemplated hereby.
7.05 Notices. All notices, requests and other communications
hereunder to a Party shall be in writing and shall be deemed given if personally
delivered, telecopied (with confirmation) or three business days after being
mailed by registered or certified mail (return receipt requested) or one
business day after being delivered by overnight courier to such Party at its
address set forth below or such other address as such Party may specify by
notice to the other Party hereto.
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If to Nortel Networks:
Nortel Networks Limited
8200 Dixie Road
Brampton, Ontario
CANADA L6T-5P6
Attention: Legal Department
Nortel Networks Inc.
200 Athens Way
Nashville, Tennessee 37228
Attention: Legal Department
With a copy to:
Nortel Networks Inc.
P.O. Box 13828
Research Triangle Park, North Carolina 27709-3828
Attention: Eric P. Jensen
Nortel Networks Inc.
2221 Lakeside Boulevard
Richardson, Texas 75082
Attention: Robert Fishman
Fax: (972) 684-3888
If to Existing Venture:
Arris Interactive, L.L.C.
Andover Research Park
6 Riverside Drive
Andover, MA 01810-1140
Attention: Bruce McClelland
Fax: 978-946-4742
Phone: 978-946-4713
With a copy to:
ANTEC Corporation
11450 Technology Circle
Duluth, Georgia 30097
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Attention: President
Fax: (678) 473-8470
Troutman Sanders LLP
600 Peachtree Street
Suite 5200
Atlanta, Georgia 30308
Attention: W. Brinkley Dickerson, Jr.
Fax: (404) 885-3900
Phone: (404) 885-3000
7.06 Entire Agreement. This IPR Agreement sets forth the entire
agreement and understanding between the Parties as to the subject matter hereof,
and merges all prior discussions between them, and neither Party hereto shall be
bound by any conditions, definitions, warranties, understandings, or
representations with respect to such subject matter other than as expressly
provided herein, or as duly set forth on or subsequent to the date hereof in
writing, signed by duly authorized officers of the Parties.
7.07 Publicity. The provisions of this IPR Agreement shall be held
in confidence by the Parties and only disclosed as may be agreed to by the
Parties or as may be required by applicable law. Neither Party shall make public
statements or issue publicity or media releases with regard to this IPR
Agreement without the prior written approval of the other Party.
7.08 Severability. Any term or provision of this IPR Agreement
which is invalid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this IPR Agreement or affecting the validity or enforceability
of any of the terms or provisions of this IPR Agreement in any other
jurisdiction. If any provision of this IPR Agreement is so broad as to be
unenforceable, the provision shall be interpreted to be only so broad as it is
enforceable.
IN WITNESS WHEREOF, the parties hereto have caused this IPR Agreement
to be executed in counterparts by their duly authorized officers, all as of the
day and year first above written.
NORTEL NETWORKS LIMITED
By: /s/ William R. Kerr
------------------------------------
Name:
Title:
By: /s/ Blair F. Morrison
------------------------------------
Name:
Title:
ARRIS INTERACTIVE, L.L.C.
By: /s/ David Potts
------------------------------------
Name:
Title:
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