EXHIBIT 10.57
NVIDIA/E&S CONFIDENTIAL
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PATENT PURCHASE AND LICENSE AGREEMENT
between:
NVIDIA INTERNATIONAL INC.
a Caymans Islands company;
and
XXXXX & XXXXXXXXXX COMPUTER CORPORATION
a Utah corporation
and
XXXXX & XXXXXXXXXX GRAPHICS CORPORATION
a Utah Corporation
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Dated as of October 15, 2001
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PATENT PURCHASE AND LICENSE AGREEMENT
THIS PATENT PURCHASE AND LICENSE AGREEMENT is entered into as of October
15, 2001, by and between XXXXX & XXXXXXXXXX COMPUTER CORPORATION, a Utah
corporation ("ESCC"), XXXXX & XXXXXXXXXX GRAPHICS CORPORATION, a Utah
corporation ("ESGC") (as used herein, "E&S" means and refers to ESCC and ESGC
collectively for all purposes other than as relates to US Patent No. 5,657,047,
and to ESGC for all purposes as relates to US Patent No. 5,657,047), and NVIDIA
INTERNATIONAL INC., a Caymans Islands company ("Nvidia"). Certain capitalized
terms used in this Agreement are defined in EXHIBIT A.
RECITALS
WHEREAS, Nvidia and E&S wish to provide for the sale of the Patents (as
defined in Section 1.1 of the Agreement) to Nvidia on the terms set forth in the
Agreement; and
WHEREAS, contemporaneously with the execution and delivery of the
Agreement, Nvidia's parent, Nvidia Corporation, and E&S are entering into a
Patent Cross License Agreement (the "Cross License Agreement") pursuant to which
Nvidia Corporation and ESCC are each granting to the other a nonexclusive
license under their respective patents (including those patents which are the
subject of this Agreement) which are in existence or which will be issued in the
future as specified in and subject to the terms and conditions set forth in the
Cross License Agreement.
NOW THEREFORE, Nvidia and E&S, intending to be legally bound, agree as
follows:
AGREEMENT
1. SALE OF PATENTS.
1.1 SALE OF PATENTS. Contemporaneously with the execution and delivery of
this Agreement, E&S shall cause to be sold, assigned, transferred, conveyed and
delivered to Nvidia, and E&S hereby sells, assigns, transfers, conveys and
delivers to Nvidia, good and valid title and all of its right, title and
interest, in the following (collectively, the "Patents"), on the terms set forth
in this Agreement:
(a) All of the United States patents identified on EXHIBIT B,
(b) All patents and patent applications (whether filed or not),
throughout the world, that are counterparts, reissues, extensions, divisions,
continuations and continuations in part of any of the United States patents
identified in EXHIBIT B;
(c) Subject to Section 2.3 of the Exclusive Patent License Agreement
attached hereto as EXHIBIT C (the "Exclusive Patent License Agreement"), all
past, present and future claims of infringement of any of the foregoing,
excluding claims of infringement of the Patents with respect to the Exclusive
Field of Use as defined in the Exclusive Patent License Agreement; and
(d) All files related to the prosecution and enforcement of any of
the foregoing.
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1.2 PURCHASE PRICE. As consideration for the sale of the Patents to
Nvidia, contemporaneously with the execution and delivery of this Agreement,
Nvidia is paying to E&S, in cash by wire transfer of immediately available funds
to an account or accounts designated by ESCC, a total of Nine Million Dollars
(U.S.$9,000,000).
1.3 NO ASSUMED LIABILITIES.
(a) E&S acknowledges and agrees that Nvidia is not assuming, and is
not required to perform or discharge, any obligations or Liabilities of any
nature of E&S (whether or not related to the Patents).
(b) Notwithstanding anything in this Agreement, Nvidia is purchasing
the Patents subject to the patent licenses, and any limitations therein, under
the Patents found in the licenses and other agreements listed in EXHIBIT D
(collectively, the "Prior Patent Licenses"). The rights and obligations of the
licensor under the Prior Patent Licenses shall not be assumed by Nvidia, but
shall continue solely in E&S. E&S shall retain all benefits of, and Nvidia shall
not interfere with, such agreements. E&S shall not extend, renew or modify any
license rights under the Patents granted under the Prior Patent Licenses nor
consent to any assignment or sublicense of or under any of the Prior Patent
Licenses.
1.4 TRANSFER TAXES AND OTHER CHARGES. Each party shall be responsible for
the payment of its own tax liability arising from this transaction.
1.5 LICENSE TO E&S. As part of this Agreement, Nvidia and E&S are entering
into and hereby agree to the Exclusive Patent License Agreement attached hereto
as EXHIBIT C, which is incorporated herein by this reference, pursuant to which
Nvidia is granting to E&S a license under the Patents which is exclusive in the
field of use specified therein, as specified in and subject to the terms and
conditions set forth in the Exclusive Patent License Agreement.
1.6 OTHER DOCUMENTS. Contemporaneously with the execution and delivery of
this Agreement, E&S shall cause to be executed and delivered to Nvidia (i)
assignments, in a form reasonably satisfactory to Nvidia, bills of sale, and
other documents as may be necessary or appropriate (in the reasonable judgment
of Nvidia or its counsel) to assign, convey, transfer and deliver good and valid
title to the Patents to Nvidia free of any Encumbrances; (ii) evidence that all
consents, approvals, and authorizations required to have been obtained in
connection with the Transactions have been obtained; (iii) and a certified copy
of resolutions of E&S's Board of Directors authorizing the execution of this
Agreement and approving the Transactions.
2. REPRESENTATIONS AND WARRANTIES OF E&S.
E&S represents and warrants to Nvidia that, as of the date hereof and
except as specifically set forth in the Disclosure Schedule:
2.1 DUE ORGANIZATION; NO SUBSIDIARIES, ETC. ESCC is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Utah. ESGC is a corporation duly organized, validly existing and in good
standing under the laws of the State of Utah and a wholly-owned subsidiary of
ESCC.
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2.2 TITLE TO PATENTS. E&S owns, and has good and valid title to, the
Patents. Except for the Prior Patent Licenses, the Patents are solely owned by
E&S free and clear of any licenses or Encumbrances. There are no counterparts,
reissues, extensions, divisions, continuations or continuations-in-part of any
of the United States patents listed in EXHIBIT B, except those counterparts,
reissues, extensions, divisions, continuations or continuations-in-part
identified in EXHIBIT B. No offer of a license under any of the Patents is
currently outstanding, other than as contemplated in connection with the
Transactions.
2.3 COMPLIANCE WITH LEGAL REQUIREMENTS. To E&S's knowledge, each of the
United States patents identified in EXHIBIT B is valid, enforceable and
subsisting. All required maintenance fees and annuities have been paid and
applicable Legal Requirements satisfied with respect to the Patents. There is no
outstanding notice or other written communication from any Governmental Body or
any other person regarding any actual, alleged, possible or potential violation
of, or failure to comply with, any Legal Requirement or challenging the validity
or enforceability of any of the Patents.
2.4 PROCEEDINGS. There is no pending Proceeding, and to E&S's knowledge no
person has threatened to commence any Proceeding: (a) respecting any of the
Patents; or (b) that challenges, or that may have the effect of preventing,
delaying, making illegal or otherwise interfering with, any of the Transactions.
There is no Order to which E&S is subject relating to any of the Patents. To
E&S's knowledge, there is no proposed Order that, if issued or otherwise put
into effect, (i) may have an adverse effect on the Patents or (ii) may have the
effect of preventing, delaying, making illegal or otherwise interfering with any
of the Transactions.
2.5 AUTHORITY; BINDING NATURE OF AGREEMENTS. E&S has the power and
authority to enter into and to perform its obligations under this Agreement, and
the execution, delivery and performance of this Agreement have been duly
authorized by all necessary action on the part of E&S and its stockholders,
board of directors and officers. Each of the Transactional Agreements to which
E&S is a party constitutes the legal, valid and binding obligation of E&S, and
is enforceable against E&S in accordance with its terms.
2.6 NON-CONTRAVENTION; CONSENTS.
(a) E&S is not, nor as a result of its execution, delivery or
performance of this Agreement will E&S be, in violation of any Contract relating
to the Patents. Except as specifically described in the Disclosure Schedule, E&S
is not obligated to provide any consideration (whether financial or otherwise)
to any third party, nor is any third party otherwise entitled to any
consideration, with respect to any exercise of rights by E&S or Nvidia in the
Patents.
(b) E&S's execution, delivery and performance of this Agreement will
not result in the imposition or creation of any Encumbrance upon or with respect
to any of the Patents.
(c) All filings, notices, consents, approvals, and authorizations
required to be obtained by E&S in connection with the execution, delivery and
performance of this Agreement and the conveyance of the Patents to Nvidia have
been obtained.
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3. INDEMNIFICATION, ETC.
3.1 SURVIVAL OF REPRESENTATIONS AND COVENANTS.
(a) The representations, warranties, covenants and obligations of
each party to this Agreement shall survive (without limitation) the execution
and delivery of this Agreement and the sale of the Patents to Nvidia. All of
said representations, warranties, covenants and obligations are personal to
Nvidia and not assignable in whole or in part, and shall remain in full force
and effect and shall survive for an unlimited period of time solely as to
Nvidia.
(b) The representations, warranties, covenants and obligations of
E&S, and the rights and remedies that may be exercised by the Indemnitees, shall
not be limited or otherwise affected by or as a result of any information
furnished to, or any investigation made by or any knowledge of, any of the
Indemnitees or any of their officers, directors, employees, agents, attorneys,
accountants, advisors, or consultants.
3.2 INDEMNIFICATION. E&S shall hold harmless and indemnify each of the
Indemnitees from and against, and shall compensate and reimburse each of the
Indemnitees for, any Damages that are suffered or incurred by any of the
Indemnitees or to which any of the Indemnitees may otherwise become subject at
any time (regardless of whether or not such Damages relate to any third-party
claim) that arise or result directly or indirectly from: (a) any breach of any
representations, warranties, covenants, or obligations of E&S in the
Transactional Agreements; (b) any Liability of E&S, including any Liability
arising from any challenge to, or claim for damages or other relief in
connection with, any of the Transactions under fraudulent transfer, bankruptcy
or similar laws, and any Liability of E&S relating to the Patents to the extent
such Liability arises from or relates to any event, circumstance, action, or
other matter occurring prior to the date hereof; or (c) any Proceeding relating
to the foregoing (including any Proceeding by any Indemnitee to enforce any of
its rights hereunder, to the extent the Indemnitee prevails in such proceeding).
3.3 NONEXCLUSIVITY OF INDEMNIFICATION REMEDIES. The indemnification
remedies and other remedies provided in this Section 3 shall not be deemed to be
exclusive. Accordingly, the exercise by any Person of any of its rights under
this Section 3 shall not be deemed to be an election of remedies and shall not
be deemed to prejudice, or to constitute or operate as a waiver of, any other
right or remedy that such Person may be entitled to exercise (whether under this
Agreement, under any other Contract, under any statute, rule or other Legal
Requirement, at common law, in equity or otherwise).
3.4 DEFENSE OF THIRD PARTY CLAIMS. In the event of the assertion or
commencement by any Person of any claim or Proceeding against Nvidia or any
other Indemnitee with respect to which E&S may become obligated to indemnify,
hold harmless, defend, compensate or reimburse any Indemnitee pursuant to this
Section 3 (other than a claim or Proceeding challenging the validity or
enforceability of the Patents as to which there is no occurrence of an event
described in Section 3.2), Nvidia shall have the right, at its election, to
designate E&S to assume the defense of such claim or Proceeding at the sole
expense of E&S. If Nvidia so elects to designate E&S to assume the defense of
any such claim or Proceeding:
(a) E&S shall proceed to defend such claim or Proceeding in a
diligent manner with counsel satisfactory to Nvidia;
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(b) Nvidia shall make available to E&S any documents and materials in
the possession of Nvidia that may be necessary to the defense of such claim or
Proceeding;
(c) E&S shall keep Nvidia informed of all material developments and
events relating to such claim or Proceeding;
(d) Nvidia shall have the right to participate in the defense of such
claim or Proceeding at its sole expense;
(e) E&S shall not settle, adjust or compromise such claim or
Proceeding without the prior written consent of Nvidia, which consent will not
be unreasonably withheld or delayed; and
(f) Nvidia may at any time (notwithstanding the prior designation of
E&S to assume the defense of such claim or Proceeding) assume the defense of
such claim or Proceeding at its sole expense.
If Nvidia does not elect to designate E&S to assume the defense of any such
claim or Proceeding (or if, after initially designating E&S to assume such
defense, Nvidia elects to assume such defense), Nvidia may proceed with the
defense of such claim or Proceeding on its own. If Nvidia so proceeds with the
defense of any such claim or Proceeding on its own:
(i) all expenses relating to the defense of such claim or
Proceeding (whether or not incurred by Nvidia) shall be borne and paid
exclusively by Nvidia;
(ii) E&S shall make available to Nvidia any documents and
materials in the possession or control of E&S that may be necessary to the
defense of such claim or Proceeding;
(iii) Nvidia shall keep E&S informed of all material developments
and events relating to such claim or Proceeding; and
(iv) Nvidia shall have the right to settle, adjust or compromise
such claim or Proceeding with the consent of E&S; PROVIDED, HOWEVER, that E&S
shall not unreasonably withhold such consent.
Notwithstanding anything to the contrary in this Agreement, the defense of any
claim or Proceeding in which the validity or enforceability of the Patents is at
issue, and as to which there is no occurrence of an event described in
Section 3.2, shall be handled in accordance with the provisions of the Exclusive
Patent License Agreement.
4. LIMITATION OF LIABILITY.
EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, IN NO EVENT SHALL E&S
BE LIABLE TO NVIDIA FOR SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES
ARISING OUT OF THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO LOST BUSINESS,
REVENUES OR PROFITS AND WORK STOPPAGES OR DELAYS, EVEN IF E&S HAS BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN
THIS AGREEMENT, IN NO EVENT SHALL E&S BE LIABLE TO NVIDIA
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FOR DAMAGES HEREUNDER IN EXCESS OF TWICE THE AMOUNT PAID BY NVIDIA FOR THE
PATENTS PURSUANT TO SECTION 1.2 OF THIS AGREEMENT.
5. CERTAIN COVENANTS.
5.1 FURTHER ACTIONS. E&S shall cooperate with Nvidia and Nvidia's
affiliates and representatives, and shall execute and deliver such documents and
take such other actions as Nvidia may reasonably request for the purpose of
evidencing the sale of the Patents and putting Nvidia in possession and control
of the Patents. E&S hereby irrevocably nominates, constitutes and appoints
Nvidia as the true and lawful attorney-in-fact of E&S (with full power of
substitution) and hereby authorizes Nvidia, in the name of and on behalf of E&S,
to execute, deliver, acknowledge, certify, file and record any document, to
institute and prosecute any Proceeding and to take any other action that Nvidia
may deem appropriate for the purpose of (i) collecting, asserting, enforcing or
perfecting any claim, right or interest of any kind that is included in or
relates to any of the Patents, (ii) subject to Section 2.3 of the Exclusive
Patent License Agreement, defending or compromising any claim or Proceeding
relating to any of the Patents or (iii) otherwise carrying out or facilitating
the sale of the Patents to Nvidia. Such power of attorney is coupled with an
interest and shall be irrevocable, and shall survive the liquidation and
dissolution of E&S.
6. MISCELLANEOUS PROVISIONS.
6.1 AGREEMENT ASSIGNMENT. Except as otherwise expressly provided in the
Exclusive Patent License Agreement, this Agreement or any rights or obligations
hereunder are not assignable by E&S without the prior written consent of Nvidia,
which consent may be withheld at the sole discretion of Nvidia. Any attempted
assignment in derogation of the foregoing shall be null and void. Nvidia may
freely assign this Agreement or any or all of its rights hereunder (excluding
its indemnification rights under Section 3), in whole or part, to any other
Person without obtaining the consent or approval of any other Person. None of
the provisions of this Agreement is intended to provide any rights or remedies
to any Person other than the parties to this Agreement. This Agreement shall
inure to the benefit of the parties, their permitted successors and assigns,
except as provided in Section 3.1(a).
6.2 NOTICE. All notices required or permitted to be given hereunder shall
be in writing and shall be delivered by hand, or if dispatched by prepaid air
courier or by registered or certified airmail, postage prepaid, addressed as
follows:
If to Nvidia: If to E&S:
Nvidia International Inc. Xxxxx & Xxxxxxxxxx Computer Corp.
2701 San Xxxxx Expressway 000 Xxxxx Xxxxx
Xxxxx Xxxxx, XX 00000 Xxxx Xxxx Xxxx, XX 00000
Xxxxxx Xxxxxx xx Xxxxxxx Xxxxxx Xxxxxx of America
Attn.: Chief Patent Counsel Attn: Chief Financial Officer
Such notices shall be deemed to have been served when received by addressee or,
if delivery is not accomplished by reason of some fault of the addressee, when
tendered for delivery. Either party may give written notice of a change of
address and, after notice of such change has been
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received, any notice or request shall thereafter be given to such party as above
provided at such changed address.
6.3 CONSTRUCTION; NO RULE OF STRICT CONSTRUCTION. Regardless of which
party may have drafted this Agreement, no rule of strict construction shall be
applied against either party. The headings contained in this Agreement are for
convenience of reference only, shall not be deemed to be part of this Agreement,
and shall not be referred to in connection with the construction or
interpretation of this Agreement. For purpose of this Agreement, a Person shall
be deemed to have "knowledge" of a particular fact or other matter if any
officer, director, or attorney or accountant (in the course of their engagement)
of or to such Person has knowledge of such fact or other matter. As used in this
Agreement, the words "include" and "including," and variations thereof, shall
not be deemed to be terms of limitation, but rather shall be deemed to be
followed by the words "without limitation." Except as otherwise indicated, all
references in this Agreement to "Sections" and "Exhibits" are intended to refer
to Sections of this Agreement and Exhibits to this Agreement.
6.4 SEVERABILITY. If any provision of this Agreement is determined by a
court to be unenforceable, the parties shall deem the provision to be modified
to the extent necessary to allow it to be enforced to the extent permitted by
law, or if it cannot be modified, the provision will be severed and deleted from
this Agreement, and the remainder of the Agreement will continue in effect.
6.5 ENTIRE AGREEMENT. This Agreement, including the Exclusive Patent
License Agreement, embodies the entire understanding of the parties with respect
to the subject matter hereof, and merges all prior and contemporaneous
discussions between them, and neither of the parties shall be bound by any
conditions, definitions, warranties, understandings, or representations with
respect to the subject matter hereof other than as expressly provided herein.
Nothing in this Agreement shall modify or supersede any of the terms or
conditions of the Cross License Agreement. No oral explanation or oral
information by either party hereto shall alter the meaning or interpretation of
this Agreement.
6.6 MODIFICATION; WAIVER. No modification or amendment to this Agreement,
nor any waiver of any rights, will be effective unless assented to in writing by
the party to be charged, and the waiver of any breach or default will not
constitute a waiver of any other right hereunder or any subsequent breach or
default.
6.7 GOVERNING LAW. This Agreement and matters connected with the
performance thereof shall be construed, interpreted, applied and governed in all
respects in accordance with the laws of the United States of America and the
State of California, without reference to conflict of laws principles.
6.8 JURISDICTION; VENUE. E&S and Nvidia agree that all disputes and
litigation regarding this Agreement and matters connected with its performance
shall be subject to the exclusive jurisdiction of the United States District
Court for the Northern District of California, if such court has personal and
subject matter jurisdiction of the litigation, or if not the courts of the State
of California located in the County of Santa Clara, California. Each party to
this Agreement (i) expressly and irrevocably consents and submits to the
jurisdiction of such courts in connection with any such legal proceeding; (ii)
agrees that such courts shall be deemed to be a convenient forum; and (iii)
agrees not to assert (by way of motion, as a defense or otherwise), in
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any such legal proceeding commenced in such courts, any claim that such party is
not subject personally to the jurisdiction of such courts, that such legal
proceeding has been brought in an inconvenient forum, that the venue of such
proceeding is improper or that this Agreement or the subject matter of this
Agreement may not be enforced in or by such courts.
6.9 CONFIDENTIALITY OF TERMS. The parties hereto shall keep the terms of
this Agreement confidential and shall not now or hereafter divulge these terms
to any third party except:
(a) with the prior written consent of the other party;
(b) if so required by the Order of any Governmental Body having
jurisdiction to call therefor, provided that the disclosing party uses its best
efforts to give the other party reasonable notice prior to such disclosure and
joins or cooperates in obtaining an appropriate protective order;
(c) only to the extent a party determines such disclosure may be
required by regulation, law or legal process, including to legal and financial
advisors in their capacity of advising a party in such matters and in disclosure
documents required to be filed with the SEC or under stock exchange rules;
(d) during the course of litigation so long as the disclosure of such
terms and conditions are restricted in the same manner as is the confidential
information of other litigating parties and so long as: (a) the restrictions are
embodied in a court-entered protective order; and (b) the disclosing party
informs the other party in writing at least ten (10) days in advance of the
disclosure;
(e) in confidence to employees with a need to know, legal counsel,
accountants, banks and financing sources and their advisors solely in connection
with complying with financial transactions; or
(f) where the terms disclosed are, through no act or failure to act
on the part of the disclosing party, generally known in the computer graphics or
simulation industry;
(g) in confidence to employees of the acquiring party with a need to
know, and legal counsel, accountants, banks and financing sources and their
advisors solely in connection with the negotiation and closing of a transaction
involving a Change of Control or the sale of one or more of the Patents.
The parties shall cooperate in preparing and agree to an announcement or press
release relating to this Agreement.
6.10 COMPLIANCE WITH LAWS. Anything contained in this Agreement to the
contrary notwithstanding, the obligations of the parties hereto and of the
Subsidiaries of the parties shall be subject to all laws, present and future, of
any government having jurisdiction over the parties hereto or the Subsidiaries
of the parties.
6.11 FORCE MAJEURE. The parties hereto shall be excused from any failure to
perform any obligation hereunder to the extent such failure is caused by war,
acts of public enemies,
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strikes or other labor disturbances, fires, floods, acts of God, or any causes
of like or different kind beyond the control of the parties.
6.12 GUARANTY. ESCC hereby unconditionally, absolutely and irrevocably
guarantees the complete performance of ESGC of all of ESGC's representations,
warranties, covenants, indemnities and obligations under this Agreement. ESCC
agrees that its liability under this Section 6.12 shall be the immediate, direct
and primary obligation of ESCC and shall not be contingent upon Nvidia's
exercise or enforcement of any remedy it may have against ESGC.
6.13 COUNTERPARTS. This Agreement may be executed in counterparts, each of
which shall constitute an original and all of which, when taken together, shall
constitute one agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the date first written above.
XXXXX & XXXXXXXXXX COMPUTER CORPORATION
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: President and CEO
XXXXX & XXXXXXXXXX GRAPHICS CORPORATION
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: President and CEO
NVIDIA INTERNATIONAL INC.
By: /s/ Xxx-Xxxx Xxxxx
Name: Xxx-Xxxx Xxxxx
Title: President and CEO
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