EXHIBIT 10.9
LICENSE AGREEMENT
THIS AGREEMENT, (the "License Agreement") is entered into effective
December 26, 1995 (the "Effective Date") between AMIGA Technologies GmbH, a
German company, having offices at Xxxxxxxx Xxxx 00, 00000 Xxxxxxxx, Xxxxxxx
("AMIGA" or "Licensor"), and Visual Information Service Corp., an Illinois
(U.S.A.) corporation, located at 0000 Xxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx, X.X.X.
00000 ("VISCORP" or "Licensee")
WHEREAS, ESCOM owns and has, or may have, rights in various patents issued,
and applications for patents pending, proprietary rights, proprietary marks,
copyrights, trademarks, trade secrets, know-how, ideas utility models, xxxxx
patents, inventor's certificates, design patents, processes, methods and devices
in various countries of the world as to which VISCORP desires to acquire
licenses as hereinafter provided;
WHEREAS, AMIGA is authorized by ESCOM to license certain technology related
to the Amiga operating system and certain compatible parts;
WHEREAS, Licensee desires to obtain a non-exclusive, non-transferable
license to the technology related to the Amiga operating system and the
compatible parts and Licensor is willing to grant a license to Licensee upon the
following terms and conditions;
WHEREAS, Licensee desires to exercise the license by making electronic
systems using the compatible parts;
NOW, THEREFORE, in consideration of the mutual covenants and conditions
hereinafter set forth, it is agreed as follows:
1. Definitions
For the purpose of this License Agreement, the following terms shall have
the following meanings:
1.1 Licensee means VISCORP
1.2 Licensor means AMIGA
1.3 Proprietary Parts refers to parts which embody elements of the
Licensed Technology over which Licensor has exclusive rights and are currently
available only from AMIGA, ESCOM or a manufacturer who manufactures the parts
under an agreement, with AMIGA or ESCOM.
1.4 Licensed Products refers to products which are made by, or for,
Licensee or used, sold, Distributed, imported, or offered for sale by Licensee
where the products are used as, or as part of, interactive television devices
(defined as electronic devices that uses a display monitor for TV-signals and a
communications-medium to allow a user to respond to the displayed signal) which
contain one or more Proprietary Parts; EXCLUDING devices that are commonly known
to
day as home computers on personal computers which use computer monitors, hard
drives, floppy drives and keyboards, fully or share developed by AMIGA.
1.5 Distributing, Distribute and Distributed refer to the act of disposing
of a Licensed Product for direct compensation or otherwise, whether by sale,
lease, or transfer in exchange for indirect benefits. If the Licensed Product
is Distributed across a governmental boundary, then the act of Distributing
includes any necessary acts of exporting and importing.
1.6 Licensed Acts refers to any act of making, having made, having
assembled, using, Distributing, importing, exporting, or offering for sale a
Licensed Product, practicing any process or method involved in the manufacture
or use of Licensed Products, and making, having made or using any proprietary
manufacturing apparatus and to practice any process or method in the manufacture
or use of Licensed Products.
1.7 Licensed Technology refers to the intellectual proprietorship of the
technology embodied in current versions of the Amiga operating system and the
Proprietary Parts. "Licensed Technology" includes microcomputer programs,
subroutines or instruction sequences, address maps and memory layouts, operating
systems, disc operating systems, utilities, programmer aides, programming
languages, compilers, assemblers, emulators, support programs, games and
applications software, whether originally designed and developed for the Amiga
operating system or converted from other languages or versions, and including
all updates and variations, and all documentation, user's manuals and other
literature and publication for or relating to the foregoing, for use in or with
the Licensed Products, and all developments, enhancements, and improvements
thereto which Licensor has the right to license to Licensee.
1.8 Licensed Rights includes any and all rights, interest and claims for
the worldwide intellectual proprietorship (including, but not limited to, U.S.
and foreign patents and patens pending, proprietary rights, proprietary marks,
copyrights, trademarks, trade secrets, know-how, ideas, utility models, xxxxx
patents, inventor's certificates, design patents, processes, methods and
devices) of the Licensed Technology and includes the right of the Licensee to
perform any of the Licensed Acts and includes the right to develop derivative
works and derivative designs based on the Licensed Technology.
1.9 An Affiliate of a party refers to a person, corporation, company or
other legal entity which controls, is controlled by, or is under common control
of the party at any time during the period for which the determination of
affiliation is being made but only for as long as said control continues.
,Control" means the power, whether of not normally exercised, to direct the
management and affairs of another corporation or other legal entity, directly or
indirectly, whether through the ownership of 15% or more of the voting stock or
other equity interest or by contract.
1.10 Original Term refers to the 3 year period beginning when the License
Agreement is signed.
1.11 Unit refers to one Licensed Product regardless of the number of
Proprietary Parts used in the Licensed Product.
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2. Grant of License
2.1 Licensor hereby grants, under the Licensed Rights, to the full extent
Licensor has the power to grant, for the term of this License Agreement, to
Licensee a nonexclusive and non-transferable license to perform the Licensed
Acts and to sublicense others to perform any Licensed Acts for Licensee.
2.1.1 The grant of license in paragraph 2.1 is a world-wide grant,
except in the People's Republic of China, Taiwan, Hong Kong, Macao and the Asian
bordering countries between the Peoples Republic of China and the former Soviet
Union. To the extent that Licensor is not currently able to grant license
throughout the world but later is able to grant a license greater than the
license initially granted under the License Agreement, Licensor agrees to
automatically grant Licensee the greater license and agrees to promptly notify
Licensee when such grant of a greater license has occurred.
2.1.2 The greater license referred in paragraph 2.1.1 shall
include a sublicense to others to perform any Licensed Act for Licensee, as set
out in paragraph 2.1, as if the greater license was originally part of the
license granted by paragraph 2.l.
2.2 Licensor hereby grants, under the Licensed Rights, to the full extent
Licensor has the power to grant, for the term of this License Agreement, to
Licensee the right to sublicense the right to SELL or otherwise Distribute
subassemblies made by, or for, Licensee under this License Agreement.
3. Royalty Payments
3.1 Licensee estimates that it will Distribute 1,000,000 Units of the
Licensed Products within the Original Term. The 1,000,000 Unit figure is a non-
binding good faith estimate, and Licensee's ability to achieve the estimate
shall not be a condition precedent to Licensor's obligations under this License
Agreement nor a term of default under this License Agreement.
3.2 Licensee shall pay a minimum royalty the full amount of which minimum
royalty will fall due within a term of twelve months following the day of the
start of Distribution of the Licensed Product or upon termination of the
Original Term of this Agreement or upon any earlier termination date, whatever
of the above dates will be the earliest date. The minimum royalty is equivalent
to the royalty on 50,000 units. This minimum royalty is not so much to be
regarded as an incentive for the Licensee to exploit the license as is customary
and exclusive license agreements but rather as an at least partly deferred
payment of compensation for initial technology transfer. The minimum royalty
will therefore fall due irrespective of what may happen to this Agreement after
initial technology transfer from Licensor to Licensee has occurred. Payments
made by Licensee in lieu of the minimum royalty are not refundable.
3.3 Licensee shall pay a royalty (the "Royalty" or "Royalties") to
Licensor for each Licensed Product Distributed by Licensee, pursuant to the
following Royalty Schedule. For purposes of the Royalty Schedule, Licensee is
only obligated to pay Licensor a Royalty once for
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a given Unit regardless of how many times the given Unit is Distributed,
returned and Distributed again.
3.4 Royalty Schedule
Beginning on the Effective Date and extending for the term of this License
Agreement, Licensee agrees to pay Licensor the following payments:
A. US$18.00 per Unit for the first 50,000 Units Distributed.
B. US$14.00 per Unit for the next 200,000 Units Distributed (the
50,001st to 250,000th Units.)
C. US$11.00 per Unit for the next 250,000 Units Distributed (the
250,001st to 500,000th Units) with a set-off credit of US$200,000
to be applied to royalties beginning with the 250,001st Unit.
(This reflects a credit from US$18 to US$14 for each of the first
50,000 Units.)
D. US$8.00 per Unit for the next 500,000 Units Distributed (the
500,001st to 1,000,000th Units) with a set-off credit of
US$750,000 to be applied to royalties beginning with the
500,001st Unit. (This reflects a credit from US$14 to US$11 for
each of the first 250,000 Units.)
E. US$8.00 per Unit for all Units over 1,000,000 Units Distributed
with a setoff credit of US$1,500,000 to be applied to royalties
beginning with the 1,000,001st Unit. (This reflects a credit from
US$11 to US$8 for each of the first 500,000 Units.)
3.5 Licensee shall make an advance Royalty payment of US$450,000 as a
credit towards royalties payable by Licensee for Distributing the first 25,000
Units as part of the execution of this License Agreement. This advanced royalty
payment is conditioned on Licensor's performance of the technology transfer
requirements set forth in this License Agreement and may be made by check. The
advance royalty payment is to be regarded as part of the minimum royalty.
3.6 Licensee shall furnish to AMIGA a written report for each calendar
quarter, not later than 30 days following the close of the quarter, setting
forth the quantity of Licensed Products Distributed during the quarter and the
computation of the aggregate Royalties payable. Each report shall be
accompanied by a payment due with respect to that quarter. For any undisputed
payment hereunder which is delayed for more than thirty (30) days beyond the due
date, AMIGA shall be entitled to receive interest on any unpaid balance
hereunder at a rate of 12% per year or such lesser rate, if any, as may be
required by law, until paid. The first report to AMIGA will be done by VISCORP
not later than August 1, 1996.
3.7 In the event Licensor enters into an Agreement with a third party
granting a license comparable to the License granted in this License Agreement
but containing commercial
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terms which are more favorable to the third party than the commercial terms
contained in this License Agreement, Licensor shall notify Licensee of such more
favorable commercial terms and Licensee shall have the right to elect and
replace the commercial terms contained in this License Agreement with such more
favorable commercial terms. This option granted to Licensee will not in any way
effect Licensee's obligation to pay the advanced royalty payment (=US-$450,000)
as calculated according to this Agreement.
3.8 Paragraph 3.7 will also be applicable in the event that a third party
performs an act which would require payment of a royalty under this License
Agreement if the act were performed by Licensee and Licensor does not take legal
action against such third party or reaches an agreement with such third party,
be it as a result of a litigation or not - the terms of which are more
favourable than the terms of this License Agreement.
3.9 Licensee shall keep books and records in sufficient detail to permit
ready and accurate determination of any Royalties payable to Licensor. Licensee
agrees to permit its books or records to be examined at Licensor's expense at
least once per quarter to the extent necessary to verify the accuracy of the
reports provided to AMIGA pursuant to paragraph 3.6. The examination will be
performed by a certified public accountant or accountancy firm appointed by
Licensor, or by an auditor appointed by Licensor if the auditor is acceptable to
Licensee. Licensor shall provide at least 7 business days prior notice of a
request for an audit.
3.10 All payments becoming due under this contract shall be made to:
AMIGA Technologies GmbH
Xxxxxxxx Xxxx 00
X-00000 Xxxxxxxx
Xxxxxxx
Account No: 200 1600
Bank: Commerzbank AG Mainz, Code: 550 400 22
3.11 Licensor and its Affiliates shall bear all taxes imposed on them, with
respect to payments made under this section 3 provided that, if so required by
applicable law, Licensee shall withhold the amount of taxes levied by the
Government of the United States or other state or local governmental bodies on
payments to be made by Licensee to Licensor pursuant to this Agreement, and
shall promptly make payment of the withheld amount to the appropriate taxing
authority and transmit to AMIGA an official tax receipt to enable Licensor to
support a claim for German tax credit, of other tax credit, based on the
withheld taxes paid by Licensee.
4. Technology Transfer
4.1 In consideration of the terms of this License Agreement Licensor
agrees to provide Licensee in a form acceptable to both parties all
documentation pertaining to the Licensed Technology that is or may be required
by Licensee for producing the licensed products. This obligation of Licensor
does not generally include an obligation to surrender source codes.
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4.2 In particular Licensor agrees to provide documentation for each
version of the Proprietary Parts and the Amiga Operating System for versions
before and including Version 3.1 except for the source codes associated
therewith.
5. Term and Termination
5.1 This License Agreement shall continue in full force and effect for the
Original Term and will be renewable for subsequent 3 year periods at Licensee's
option, by written notice to Licensor at least 60 days prior to the termination
of any such period.
5.2 In addition to any other remedy which it may have at law or in
equity,either party may immediately terminate this License Agreement if the
other party (a) materially breaches or fails to perform any of its obligations
hereunder and if such breach or failure is not capable of being cured, or if
such breach or failure, though curable, is not cured within 60 days of
sufficient notice thereof from the nonbreaching party. Sufficient notice is
notice which identifies the material breach and specifically identifies the
precise actions required to cure such breach.
5.3 The following rights, duties, privileges and obligations shall survive
termination of this License Agreement:
A. Obligation to pay Royalties as set forth hereinabove; and
B. Obligations to keep confidential information information
confidential as set forth herein.
C. Using Technology not as defined.
5.4 The parties expressly understand and agree that repeated breaches
cannot constitute a material breach in and of themselves and agree that repeated
breaches provide separate opportunities for cure.
5.5 After 4 years either party may give a 1 year notice on the anniversary
of the agreement that this agreement may be terminated without any reason.
6. Assignability
6.1 Assignability by Licensor. This License Agreement may be assigned or
transferred by Licensor without the prior consent of Licensee if assigned or
transferred together with all of the rights and obligations of Licensor under
this License Agreement. Any assignment by Licensor shall not affect Licensee's
rights under this License Agreement.
6.2 Assignability by Licensee. This License Agreement may not be assigned
or transferred by Licensee except with the prior written consent of AMIGA unless
the assignment is to an Affiliate of VISCORP. AMIGA's consent shall not be
unreasonably withheld.
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7. Proprietary Rights Protection
7.1 Licensor and Licensee acknowledge that by virtue of this License
Agreement their employees and agents may gain access to information that is
confidential and/or proprietary to the other party and that such material may or
may not be marked or stamped "confidential", including without limitation, the
product, the work, the process, the know-how, the show-how, the licensed
software and other trade secrets related to the manufacturing of Licensed
Products and the manufacturing of products compatible therewith ("Confidential
Information"). Licensor and Licensee will use all reasonable efforts to
maintain in confidence all Confidential Information, to avoid disclosing the
Confidential Information to any third party, and to avoid using or permitting
others to use the Confidential Information, commercially or otherwise, in any
manner contrary to the purposes of this License Agreement or the best interests
of the other party.
7.2 Licensor and Licensee shall only disclose Confidential Information of
the other to those of its employees who have a need to know the same in order to
accomplish the purposes of this License Agreement. Prior to disclosing any
Confidential Information, Licensor or Licensee shall inform such employees who
are to have access to the Confidential Information, of the party's limitations,
duties and obligations regarding the use, nondisclosure and copying of the
Confidential Information shall obtain the written agreement of such employees to
comply with those limitations, duties and obligations. Both Licensor and
Licensee shall maintain a list of its employees who have access to the
Confidential Information. Upon reasonable notice to the other party, the party
disclosing Confidential Information may audit such records.
7.3 Notwithstanding the above, Licensor and Licensee shall have no
obligation with respect to any information which: (1) was already known to them
at the time of receipt hereunder, (2) is or becomes public or rightfully
received by them from a third party without similar restriction and without
breach hereof; (3) is independently developed by them without benefit of any
disclosure hereunder, or (4) is approved for release by written authorization of
the disclosing party.
7.4 The provisions of this License Agreement obligating the parties
regarding Confidential Information shall survive the termination of this License
Agreement.
7.5 Upon proper termination of this License Agreement by either party, use
of all License Technology, ESCOM AG's proprietary rights and proprietary marks
by Licensee shall be discontinued and the licenses and rights granted hereunder
shall expire and Licensee shall have no further rights or access to the Licensed
Technology, ESCOM AG's proprietary information and proprietary marks, except as
to Licensed Products for which a Royalty has already been paid or which have
already been Distributed or shipped. Within 30 days after any such termination
of this License Agreement, all materials pertaining to the Licensed Technology
provided by the Licensor (except as has been incorporated into the Licensed
Products) and all other materials containing any Confidential Information shall
be returned to AMIGA, or destroyed on written instructions. If such termination
is not a result of any breach of this License Agreement by Licensee, Licensee
may continue to Distribute Licensed Products as have
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been manufactured prior to such termination provided Licensee pays the Royalty
for each Unit Distributed or shipped on which a Royalty has not already been
paid.
7.6 Licensee shall not remove or otherwise obliterate any trademark,
patent, copyright or other proprietary rights notices or markings included on or
in any material supplied to Licensee.
8. Representations and Warranties
8.1 AMIGA, as condition precedent to the entering of this License
Agreement, represents, warrants and covenants the following:
A. AMIGA has the right and power to enter into this License
Agreement;
B. Amiga represents that ESCOM AG purchased proprietary rights and
proprietary marks from Commodore Electronics Limited, Bahamas,
Commodore Amiga Inc., California, Commodore International Service
Corporation, Delaware, Commodore Business Machines, Delaware, and
Commodore Business Machines Limited, Canada as far as such
proprietary rights and marks were offered for sale and available
for purchase.
C. AMIGA is licensed and/or authorized by ESCOM, the legal owner of
the Licensed Technology, its successors and assigns, to grant
this license to Licensee/VISCORP for all proprietary rights and
proprietary marks owned by ESCOM in the Licensed Technology.
D. AMIGA represents that it has the power to bind ESCOM to follow
the terms of this License Agreement as if ESCOM were a Licensor
signatory hereto.
E. AMIGA represents that it has no knowledge of any third party
rights with which the Licensed Technology may be in conflict.
However, AMIGA assumes no warranty for the Licensed Technology to
be free from any conflicting third party rights.
8.2 AMIGA warrants that it has both the right and the power to grant, to
the Licensee, or for the benefit of the Licensee, the rights, privileges,
immunities and license granted herein.
8.3 AMIGA warrants that it has not granted any exclusive licenses or other
rights to a third party which might give the third party a cause of action
against licensee based on licensee performing a Licensed Act.
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8.4 Nothing in this License Agreement shall be construed as:
A. A restriction on rights for things not licensed.
B. An admission, warranty or representation as to validity or scope
of right, or limitation on contesting the validity or scope of
right.
C. An obligation to file patent applications.
9. Indemnity
9.1 AMIGA shall defend or settle, at its own expense (including attorneys'
fees), any claim, suit, loss or damage of Licensee arising out of Licensee's use
of the Proprietary Parts, as far as they have been supplied by Licensor or one
of this affiliates pursuant to the license granted in this License Agreement,
including claims, suits, losses and damages based on a claim that the making,
use or sale of the Proprietary Parts infringes any patent, trademark, copyright,
trade secret, or other proprietary right belonging to any third party.
9.2 AMIGA shall indemnify and hold Licensee harmless against all damages,
judgments, and attorneys' fees arising out of the foregoing, provided that
Licensee gives AMIGA prompt written notice of such claim.
10. Distribution by AMIGA
10.1 Licensee grants to AMIGA and to ESCOM AG or its Affiliates, at AMIGA's
or ESCOM AG's option, a non-exclusive and non-transferable right for the term of
this License Agreement to market Licensed Products, purchased from Licensee,
within the territory specified in Exhibit A. Subject to the foregoing, Licensee
agrees to supply AMIGA or ESCOM AG the Licensed Products on the most favorable
terms then available to any other vendor or distributor in the countries
specified in Exhibit A.
10.2 Licensee shall defend or settle, at its own expense (including
attorneys' fees), any claim, suit, loss or damage of Licensor arising out of
Licensor's use of the Licensed Products pursuant to the grant in paragraph 10.1
if the claim, suit, loss or damage is based on a claim that the marking, use or
Distribution of Licensed Products infringes any patent, trademark, copyright,
trade secret, or other proprietary right belonging to any third party, unless
the claim could be made against the making, use or Distribution of the
Proprietary Parts alone.
11. Grant Back Rights
11.1 Licensee agrees to license AMIGA and ESCOM AG or its Affiliates, at
AMIGA's or ESCOM AG's option, enhancements made by Licensee to the Proprietary
Parts at a reasonable royalty rate, to be negotiated in good faith, in fields of
use which do not compete with Licensee's business.
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11.2 Nothing in the License Agreement, except as expressly set forth
herein, is a grant to Licensor of any interest or license to the rights of
Licensee.
12. Miscellaneous
12.1 This License Agreement shall be construed in accordance with the laws
of the Federal Republic of Germany with exclusive venue in the courts in
Frankfurt am Main, Germany.
12.2 No other Understanding. This License Agreement set forth the entire
agreement and understanding between the parties as to the subject matter thereof
and supersede all prior discussions or agreements between them.
12.3 Disclaimers and Limitations of Rights and Duties. Nothing contained
in this License Agreement shall be construed as imposing on either party any
obligation to file any patent application or to secure any patent or maintain
any patent in force, except that Licensor will, at Licensee's request and
expense, file, secure, or maintain a patent or patent application if Licensee
deems it to be of a competitive benefit to Licensee.
12.4 Marking. Wherever it is the practice of Licensee to xxxx its products
with patent notices, the Licensed Products shall be so treated. The parties
acknowledge that the aforesaid marking shall not be deemed or construed as any
admission by Licensee as to the infringement, validity or enforceability of any
right proprietary to the Licensor.
12.5 Captions. The captions used in this License Agreement are for
convenience only and are not to be used in interpreting the obligations of the
parties under this License Agreement.
12.6 World Usage. Words denoting the singular will include the plural and
vice versa; words denoting any gender will include all genders; words denoting
persons will include corporations and vice versa, where applicable.
12.7 Severability. If any term, clause, or provision of this License
Agreement shall be judged to be invalid or unenforceable, the validity or
enforceability of any other term, clause or provision, shall not be affected;
and such invalid unenforceable term, clause, or provision shall be deemed
deleted from this License Agreement and this License Agreement adjusted
accordingly.
12.8 Confidentiality. The terms and conditions including the Royalties set
forth in Section 3 above, shall remain strictly confidential, and neither party
shall disclose, advertise or inform third parties of the amount of said
Royalties, terms or conditions, unless required by law. The existence of this
License Agreement is not confidential.
12.9 Signatures. The signing of this License Agreement may be in multiple
parts and may be made by facsimile without affecting the validity of this
License Agreement.
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12.10 Purchase Agreement. The parties agree to enter in a mutually
agreeable Purchase contract referring to the supply of the required chipsets
which should be done exclusively by AMIGA.
12.11 Correspondence. All correspondence between Licensor and Licensee
shall be made to the addresses as listed below.
Licensor:
AMIGA Technologies GmbH
ATTN: Xx. Xxxxx Tyschtschenko ATTN: Xx. Xxxx Xxxxxxx
President Company Lawyer
Berliner Ring 89 Berliner Ring 89
D-64625 Xxxxxxxx, Xxxxxxx X-00000 Xxxxxxxx, Xxxxxxx
Phone: x00-(0)0000-000000 Phone: x00-(0)0000-000000
Fax: x00-(0)0000-000000 Fax: x00-(0)0000-000000
Licensee:
Visual Information Service Corp.
ATTN: Xx. Xxxxxxx X. Xxxx
0000 Xxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000 X.X.X.
Phone: x0-000 000 0000
Fax: x0-000 000 0000
with simultaneous copy to:
Xxxxxxxx and Xxxxxxxx and Crew
ATTN: Xxxxxxx X. Xxxxx
Xxx Xxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Phone: x0-000-000-0000
Fax: x0-000-000-0000
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IN WITNESS WHEREOF, the parties have caused this License Agreement to be
executed by their duly authorized representatives.
AMIGA TECHNOLOGIES GMBH LICENSEE--VISCORP
Date:_________________________ Date:_______________________________
By:___________________________ By:_________________________________
Name: Petro Tyschtschenko Name: Xxxxxxx X. Xxxx
Title: President Title: President
Address: 0000 Xxxxxxx Xxxxx xxx
Xxxxxxx, Xxxxxxxx 00000
By:___________________________ Fax: x0-000-000-0000
Name: Xxxxxx Xxxxxxx
Title: President
Address: Xxxxxxxx Xxxx 00
X-00000 Xxxxxxxx
Xxxxxxx
Fax: x00-(0)0000-000000
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EXHIBIT A
TERRITORY OF DISTRIBUTION
Finland
Norway
Sweden
Iceland
Denmark
Ireland
UK
Belgium
Netherlands
Luxembourg
Germany
France
Spain
Portugal
Austria
Switzerland
Italy
Czech Republic
Slovakia
Hungary
Turkey
Romania
Bulgaria
Malta
Cypress
Greece
Albania
Former Yugoslavia
Ukraine
