EXHIBIT 10.54
SETTLEMENT AGREEMENT
This Settlement Agreement is between InterDigital Technology Corporation
("ITC"), a Delaware corporation with a mailing address of 300 Delaware Avenue,
Suite 527, Wilmington, DE 19801, and NEC Corporation ("NEC"), a company
organized and existing under the laws of Japan, with a mailing address of 7-1,
Shiba 5-chome, Minato-Ku, Tokyo 108-8001 Japan (collectively, "Parties").
PREAMBLE
WHEREAS, the Parties are the parties to an existing Patent License Agreement
("License Agreement"), dated May 8, 1995, covering the payment of royalties for
certain TDMA-based products manufactured and sold by NEC;
WHEREAS, the Parties have had disputes under the License Agreement, some of
which have been arbitrated ("Arbitration") before an AAA Commercial Arbitration
Panel ("Panel") in accordance with the License Agreement, and the arbitrators
are now deliberating;
WHEREAS, the Parties desire to resolve the issues pending before the Panel, as
well as all other outstanding disputed issues under the License Agreement,
amicably and move forward with a business relationship; and
WHEREAS, in order to resolve all disputed issues, including those pending before
the Panel, the Parties have agreed to contemporaneously enter into this
Settlement Agreement, an amendment to the License Agreement ("Amendment to
Patent License Agreement") and a Narrowband CDMA and Third Generation Patent
License Agreement ("3G Agreement").
NOW, THEREFORE, in consideration of the mutual promises contained herein, and
intending to be legally bound, the parties agree as follows:
1) This Settlement Agreement shall not be effective unless and until the
Amendment to Patent License Agreement and the 3G Agreement have been executed
and delivered by the Parties, it being understood and agreed that exchange by
fax shall constitute delivery hereunder. (The date all three agreements have
been executed and delivered is referred to herein as the "Effective Date".)
2) In consideration for NEC's execution and delivery of the Amendment to Patent
License Agreement and the 3G Agreement and for the payment by NEC of a certain
lump sum amount specified in the first sentence of Article 1 of the Amendment to
the Patent License Agreement pursuant to said Amendment to the Patent License
Agreement, ITC agrees not to assert against NEC any claim asserted by ITC in the
Arbitration regarding the non-payment of royalties owed under the License
Agreement up to and including the Effective Date. Further, NEC and ITC hereby
remise, release and forever discharge each other as to any other claims, demands
and liabilities arising under the License Agreement up to and including the
Effective Date.
3) Once this Settlement Agreement, the Amendment to Patent License Agreement and
the 3G Agreement have been executed and delivered by the parties, ITC and NEC
will promptly advise the Arbitrators and the AAA that the disputes between the
Parties have been settled, the Arbitration should be immediately terminated, no
award or opinion should issue, all documents evidencing any Opinion or Award
(including without limitation spreadsheets, drafts and notes) in the possession
or under the control of the Arbitrators should be destroyed, and the amount of
the award and the opinion shall not be disclosed to either Party or any third
party.
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4) Terms, when used with initial capital letters in this Settlement Agreement,
shall have the meanings described under the License Agreement.
5) The validity and interpretation of this Settlement Agreement shall be
governed by Delaware law, without regard to conflict of laws principles. The
parties further irrevocably consent to exclusive jurisdiction of the federal
courts in the State of Delaware for the purpose of enforcing this Settlement
Agreement only. Process shall be deemed sufficient if served on either party by
courier service or recognized mail delivery service (e.g. U.S. Mail), postage
prepaid, certified or registered, return receipt requested, and addressed as
indicated on page 1 of this Settlement Agreement. The parties hereby waive any
objection as to the sufficiency of the method of service provided such service
is made as set forth herein.
6) This Settlement Agreement, the License Agreement, the Amendment to Patent
License Agreement and the 3G Agreement constitute the entire agreement and
understanding between the Parties concerning the subjects addressed before the
AAA Commercial Arbitration Panel and otherwise, and supersede any all prior or
written agreements or understanding between them concerning the same. No
representations, promises or agreements on the subject matters contained in this
Settlement Agreement have been made other than those specifically set forth
herein.
7) This Settlement Agreement can only be amended or modified by a written
document executed by duly authorized officers of each of the Parties.
8) No waiver of any right under this Settlement Agreement shall be deemed
effective unless in writing and signed by the party charged with such waiver,
and no waiver shall operate as a waiver of any future such right or any other
right arising under this Settlement Agreement.
9) This Settlement Agreement is binding upon and shall inure to the benefit of
the parties hereto and their respective successors and/or assigns.
IN WITNESS WHEREOF, the Parties have executed this Settlement Agreement by their
duly authorized representatives.
INTERDIGITAL TECHNOLOGY NEC CORPORATION
CORPORATION
By: /s/ William J. Merritt By: /s/ Mineo Sugiyama
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Senior Executive Vice President
Title: President Title: and Member of the Board
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Dated: January 14, 2002 Dated: January 15, 2002
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