RISCOS LICENCE AND DEVELOPMENT AGREEMENT
This Licence and Development Agreement (the "Agreement") is entered into
this 20th day of February, 1997 (the "Effective Date") between Acorn
Computers Limited ("Acorn") with its principal place of business at
Acorn House 000 Xxxxxxxxx Xxxx, Xxxxxxxxx XX0 0XX, Xxxxxxx and Xxxxxx
Xxxxxx Marketing Corporation with its principal place of business at
00000 Xxxxx Xxxxxx, Xxxxxx, Xxxxx 00000, Xxxxxx Xxxxxx of America
("Licensee").
WHEREAS
(A) Acorn has developed and owns certain Technology, Source Material and
Derivative Works; and
(B) Licensee which is in the business of designing, developing and
marketing various types of TV based consumer products and services,
desires to manufacture, distribute and sublicence Licensee Products
based on the Technology; and
(C) Acorn is willing to licence its Technology to Licensee for the sole
and limited purpose of enabling Licensee to manufacture and distribute
and sublicence the right to manufacture and distribute Licensee Products
based upon and incorporating the Technology on the terms and conditions
contained herein; and
(D) Acorn is willing and able to provide certain technical services to
assist Licensee; and
(E) Acorn wishes to protect and promote certain trademarks and other
Intellectual Property Rights used in connection with or related to the
Technology.
NOW THEREFORE, Acorn and Licensee enter into this Licence and Development
Agreement on the following terms.
1. Definitions
1.1 "Acorn Hardware" means ARM microprocessor based hardware designs
developed by or on behalf of Acorn which are suitable for incorporation
in interactive devices.
1.2 "Authorised Sublicensee" means a third party which has executed a
sublicence in accordance with Clause 3.5 subsequent to written approval
by Acorn.
1.3 "CM Implementation" means the specific implementation of the
Technology developed by Acorn (pursuant to Clause 2) the features and
functions of which are described in Schedule 3.
1.4 "Conditions of Contract" shall mean Acorn's standard terms of
business, a copy of which is attached at Exhibit B.
1.5 "Confidential Information" means the Technology, Source Material and
information which relates to (i) Acorn hardware or software, (ii)
Licensee hardware or software, (iii) the customer lists, business plans
and related information of either party, and (iv) any other technical or
business information of the parties, including the terms and conditions
of this Agreement.
1.6 "Derivative Work(s)" means: (i) for material subject to copyright,
registered or unregistered design protection, any work which is based
upon one or more pre-existing works of the Technology, such as a
revision, modification, translation, abridgement, condensation,
expansion, collection, compilation or any other form in which such pre-
existing works may be recast, transformed or adapted, (ii) for
patentable or patented materials, any adaptation, subset, addition,
improvementor combination of the Technology, and (iii) for material
subject to trade secret protection, any new material, information or data
relating to and derived from the Technology, including new material which
may be protectable by copyright, patent or other proprietary rights, and,
with respect to each of the above, the preparation and/or use of which,
in the absence of this Agreement or other authorisation from the owner,
would constitute infringement under applicable law. "Derivative Works"
shall include, but shall not be limited to, the CM Implementation.
1.7 "Documentation" means reference manuals which Acorn provides for use
with the Technology together with ancillary documents which are more
particularly identified in Schedule 1.
1.8 "Functional Specification" means a functional specification for any
Phase submitted by Acorn and approved by Licensee in accordance with
Clause 2.2.
1.9 "Intellectual Property Rights" means all intellectual property rights
worldwide arising under statutory or common law, and whether or not
perfected, including, without limitation, all (i) patents, patent
applications and patent rights; (ii) rights associated with works of
authorship including copyrights, copyright applications, copyright
registrations, mask work rights, mask work applications, mask work
registrations; (iii) rights relating to the protection of trade secrets
and confidential information; (iv) any right analogous to those set forth
in this Clause 1.9 and any other proprietary rights relating to
intangible property; and (v) divisions, continuations, renewals, re-
issues and extensions of the foregoing (as and to the extent applicable)
now existing, hereafter filed, issued or acquired.
1.10 "Licensee Product" means any set-top box or Internet TV product
designed or distributed by Licensee or under a Licensee trademark into
which the Technology is integrated in whole or in part. The "Licensee
Product" must operate in conjunction with the Technology and shall not
be promoted as a technology which replaces or substitutes for the
Technology.
1.11 "Object Code" means a form of software code resulting from the
translation or processing of Source Code by a computer into machine
language or intermediate code, which thus is in a form that would not be
convenient to human understanding of the program logic, but which is
appropriate for execution or interpretation by a computer.
1.12 "Purpose" means the development of Licensee Product in accordance
with Clause 3.
1.13 "RiscOS Development System" means a development system as specified
in Schedule 2 Part III.
1.14 "Source Code" means a form in which a computer program's logic can
be deduced by a human being reasonably skilled in the art, such as a
printed listing of the program or a form from which a printed listing
can be easily generated.
1.15 "Source Code Material" means the Source Code versions of the browser
and device drivers more particularly identified in Schedule 2 Part II.
1.16 "Technical Proposal" means the proposed outline technical
solution, exhibited at Schedule 5.
1.17 "Technology" means the current (as at the Effective Date) Object
Code version of the operating system software developed by Acorn for use
with an ARM[7500] microprocessor, and known as RiscOS 3.6 as more
particularly identified in Schedule 2 Part 1 together with Acorn
Hardware, the Derivative Works developed by Acorn pursuant to Clause 2,
the Object Code versions of the Source Code Material and the Upgrades and
Updates.
1.18 "Trademark" means names, logos, designs, characters, and other
designations or brands used by Acorn in connection with the Technology.
1.19 "Updates" means any bug fixes, minor modifications or variations of
the Technology which Acorn generally licences as a standard part of the
Technology.
1.20 "Upgrades" means any new features or major enhancements of the
Technology. The term "Upgrades" does not include new versions of the
Technology bearing Acorn version numbers which are higher than 3.6.
2. Development Work
2.1 Licensee currently wishes Acorn to undertake three (3) phases of
development and product integration work:
(a) Use of existing Technology to bring Licensee Product to market
quickly ("Phase I"). Target is Licensee Product shipments in April 1997.
(b) Appropriate modifications to Phase 1 Technology in order to reduce
product costs ("Phase II"). Target is Licensee Product shipments in
November 1997.
(c) High level integration of the Technology within a new, as yet
unspecified, custom chip (Phase III). Target is Licensee Product
shipments in November 1998.
2.2(a) The first deliverable of each Phase shall be a draft functional
specification which shall include:
(i) a detailed definition of the work to be undertaken by Acorn under
such Phase (including deliverables) which will further functionally
define and expand or limit the outline proposals contained in the
Technical Proposal;
(ii) a projected time schedule and cost estimate in respect of such
Phase;
(iii) acceptance criteria for such Phase.
(b) Licensee shall within ten (10) working days of receipt of a draft
functional specification approve the same in writing or request any
modifications or amendments which it reasonably considers necessary in
order to achieve compliance with the Technical Proposal. For the
avoidance of doubt Licensee shall not be entitled to withhold or delay
its written approval of a draft functional specification on any grounds
other than its failure to comply with the Technical Proposal. Within ten
(10) working days of receipt by Acorn of such a request Acorn shall
submit an amended draft functional specification to Licensee and the
approval process outlined above shall be repeated.
(c) If an amended draft functional specification submitted by Acorn is
not approved by Licensee in accordance with Clause 2.2 (b) either party
may terminate this Agreement upon written notice to the other whereupon
Licensee shall be deemed to have terminated the authorisation contained
in Clause 2.3 (a) and a reconciliation shall be undertaken in accordance
with Clause 2.6.
(d) Forthwith following its approval of a functional specification
Licensee shall issue a purchase order to Acorn consistent with the terms
of this Agreement authorising Acorn to proceed with the development of
the relevant Phase in accordance with the Functional Specification.
2.3 (a) Licensee hereby authorizes Acorn to proceed with the development
of Phase 1 in accordance with the Technical Proposal on a time and
materials basis, subject to the Conditions of Contract. In the event of
any conflict between the Conditions of Contract and any other provision
of this Agreement, the latter shall prevail.
(b) If at any time Licensee requests Acorn's agreement to an amendment of
the Technical Proposal, or functional specification Acorn shall not
(subject to resource availability) unreasonably withhold or delay its
agreement to such amendment. Licensee acknowledges that such amendments
may affect the delivery dates and costs contained in Functional
Specifications.
2.4 Licensee shall compensate Acorn for development costs relating to
Phase I inter alia by immediate initial advance payment against a
development cost to be calculated on a time and materials basis.
2.5 Acorn's development time shall be compensated at the agreed rate (the
"Basic Charge Rate") and actual development costs to date will be
reconciled with the above advance payment within fifteen (15) days after
the Effective Date hereof. Thereafter, for the duration
of Phase I, and during Phases II and III, Acorn agrees to provide
Licensee with monthly statements no later than the twenty-first (21st)
day following each month end reflecting development charges and costs
(together with any additional agreed sums due to Acorn pursuant to this
Agreement including without limitation travel and subsistence expenses
and purchase price of products supplied to Licensee) incurred since the
previous monthly statement. Acorn shall be entitled to set-off all such
costs against the above advance. After the above advance is reduced to
L50,000, Licensee will make further advance payments against development
costs to the extent necessary for Acorn to retain L50,000 in escrow
("Escrow Fund"), against which monthly development costs will be
charged. Licensee will have fifteen (15) days following receipt of a
monthly statement from Acorn to pay the amount reflected in such monthly
statement, so that the Escrow Fund, is maintained at L50,000. Upon
completion of Phase III, any development costs and expenses (or other
agreed costs) incurred by Acorn under this Agreement since the previous
monthly statement will be reconciled and charged against the Escrow
Fund, and any underpayment will be paid to Acorn and any overpayment will
be refunded to Licensee within fifteen (15) days of the reconciliation.
The Escrow Fund may be maintained in any Acorn account, as long as the
running balance of the Escrow Fund is sufficiently monitored to
accomplish the purposes of this Clause 2.5. Statements and
reconciliations provided to Licensee hereunder may be unaudited, but will
be certified as true and correct by an Acorn company officer.
2.6 Licensee may terminate the said development work authorization upon
seven (7) days notice without cause subject to the payment by Licensee of
a cancellation charge equal in value to the accountable development
costs accrued up to the date of such notice of termination. In addition
Acorn shall be entitled to receive compensation for all of its
development time and materials and other costs and expenses accrued as of
the date of notice of termination. The said accrued development costs
and cancellation charge shall be reconciled against the advance payment
and any under or over payment shall be refunded or made within fifteen
(15) days of the date of termination.
2.7 Reasonable travel and subsistence expenses incurred by Acorn in
rendering services to Licensee shall be reimbursed to Acorn within thirty
(30) days of being invoiced to Licensee.
2.8 Acorn shall not be obliged to undertake any development work prior to
acceptance by Acorn of a purchase order relating thereto in an agreed
form duly signed on behalf of Licensee.
2.9 Licensee shall have fifteen (15) days from the receipt of each Phase
developed by Acorn to test whether such Phase materially conforms to the
acceptance criteria defined in the Functional Specification. If such
Phase fails in any material respect to conform to a material feature of
the acceptance criteria defined in the Functional Specification Licensee
shall notify Acorn in writing of the error promptly (during the said
fifteen day period) upon discovery thereof, and Acorn shall use all
reasonable efforts to correct such error promptly and notify Licensee
that such Phase is again ready for testing. Licensee shall have fifteen
(15) days to test each corrected Phase and if all errors have been
corrected, Licensee shall accept such Phase in writing. Failure of the
Licensee to notify Acorn in writing within the specified time period that
such Phase or corrected Phase materially fails to conform to a material
feature of the acceptance criteria defined in the Functional
Specification and that Licensee is rejecting such Phase shall be deemed
to constitute satisfactory completion and acceptance of such Phase. Any
shipment, by Licensee or an Authorised Licensee, of Licensee Products
incorporating deliverables from any Phase shall be deemed to constitute
acceptance by Licensee of such deliverables.
3. Grant
3.1 Licence: Subject to the terms and conditions contained in this
Agreement Acorn hereby grants to Licensee, and Licensee hereby accepts,
under the Intellectual Property Rights of Acorn:
(a) a perpetual, non-exclusive, non-transferrable licence to use, copy
and modify the Source Code Material only for the purpose of creating
Derivative Works for use solely in conjunction with Licensee Products;
and
(b) a perpetual, worldwide, non-exclusive, non-transferable right
(together with a licence to permit Authorised Sublicensees to exercise
such right) to incorporate the Technology (in whole or in part) in
Licensee Products; and
(c) a perpetual, worldwide right to distribute Licensee Products and
permit Authorised Sub-licensees to distribute Licensee Products.
3.2 Restrictions (a) Licensee shall only use the Technology and the
Source Code Material for the Purpose and in a manner consistent with the
terms of this Agreement; and (b) Licensee shall use the Technology only
in a manner reasonably designed to avoid jeopardising or prejudicing
Acorn's Intellectual Property Rights therein; and
(c) Notwithstanding any other provision of this Agreement, save as an
integral component of a Licensee Product, Licensee shall not distribute
or provide access to the Technology, the Source Code Material or any
Derivative Works (or any part thereof) to any third party other than in
the exercise of the express rights granted in Clauses 3.1 and 3.7.
(d) Notwithstanding the provisions of Clause 3.4 Acorn undertakes that it
shall not grant a licence to any third party to exploit the CM
Implementation within the Internet TV or set top box market place prior
to the earlier of (i) the elapse of one (1) year following the date of
the first shipment for sale by Licensee of Licensee Product based upon
the (Phase 1; or (ii) the cumulative recorded sales of Licensee
Products reaching one million (1,000,000) units. Subsequent to the
expiration of the aforesaid restriction Acorn shall not grant a licence
to any third party to exploit the CM Implementation within the above
mentioned market place without first referring such third party to the
Licensee and providing the Licensee with a reasonable period of time in
which it may negotiate a sublicence or product sale to such third party.
Nothing contained in this Agreement shall have the effect of restricting
the right of Acorn to licence or otherwise exploit the Technology or any
part thereof (or combination of parts thereof) save for the above-
mentioned express restriction relating to the CM Implementation.
3.3 Documentation
Acorn hereby grants to Licensee and Licensee hereby accepts, under
Acorn's Intellectual Property Rights, a non-exclusive, non-transferable
licence (i) to use and modify the Documentation to create technically
accurate unaltered subsets of the Documentation which shall include all
the relevant Acorn copyrights, notices, and marks, and (ii) to translate
the Documentation into other languages.
3.4 Ownership
(a) Acorn retains all right, title and interest in the Technology
(including all Derivative Works), the Source Code Material,
Documentation, Trademarks and all associated Intellectual Property
Rights. Licensee agrees at Acorn's expense to execute (in recordable form
where appropriate) any instruments and/or documents as Acorn may
reasonably request to verify and maintain Acorn's ownership rights, or to
transfer any part of the same which may vest in Licensee for any reason.
(b) For the avoidance of doubt both parties acknowledge (i) that works
legally created by Licensee or its contractors which are inter-operable
with the Technology shall not be regarded as Derivative Works PROVIDED
that such works do not infringe the Intellectual Property Rights of
Acorn, and (ii) that all right, title and interest in such works shall be
retained by Licensee PROVIDED FURTHER that nothing contained in this
Clause 3.4(b) or in any other provision of this Agreement shall have the
effect of assigning or transferring the ownership of any Intellectual
Property Rights in any part of the Technology including (without limiting
the generality of the foregoing) the Source Code Material to Licensee.
3.5 Sublicences
Licensee shall not grant any sublicence, permission or authorisation
relating to the Technology or any part thereof without the prior written
consent of Acorn which shall not be unreasonably withheld; and prior to
any such grant to an Authorised Sublicensee the Licensee shall;
(a) procure that such Authorised Sublicensees shall execute a form of
sublicence which is consistent with the terms and conditions of this
Agreement and is in a form acceptable to Acorn and contains appropriate
indemnities and undertakings from such Authorised Sublicensee which
protect Acorn's Intellectual Property Rights and Confidential Information
in a manner which is consistent with the protections contained in this
Agreement which shall include (without limiting the generality of the
foregoing) undertakings not to modify the Technology or any part thereof
and to abide by the relevant terms of this Agreement governing use,
distribution and confidentiality; and
(b) pay to Acorn in respect of each such sub-licence a non-refundable non-
recoverable sub-licence fee and a non-refundable advance royalty payment
which shall be credited against future royalties payable in connection
with the activities of the relevant Authorised Sublicensee, unless an
alternative amount and payment schedule is agreed in writing by Acorn and
Licensee.
3.6 No Other Grant
Each party acknowledges that this Agreement does not grant any right or
licence, under any Intellectual Property Rights of the other party, or
otherwise, except as expressly provided in this Agreement, and no other
right or licence is to be implied by or inferred from any provision of
this Agreement or by the conduct of the parties.
3.7 Contractors
Licensee may retain third parties to furnish services to it in connection
with the development of the Licensee Product; provided, however, that all
such third parties who perform work in furtherance of such activities
shall execute appropriate documents: (i) acknowledging their work-made-
for-hire status and/or effecting assignments of all Intellectual Property
Rights with respect to such work to Licensee or Acorn as appropriate,
and (ii) undertaking obligations of confidentiality and non-use with
respect to such work which are consistent with the terms of this
Agreement. Acorn may, upon its request, review any such form of documents
and agreements proposed for use by Licensee.
3.8 Source Code Escrow
Acorn agrees to deliver, within forty-five (45) days of Acceptance by
Licensee of each Phase a copy of the Source Code for the Technology
relating to such Phase to a mutually agreed escrow agent, such agreement
not to be unreasonably withheld PROVIDED that Licensee shall be
responsible for payment of all costs and fees charged by such escrow
agent and PROVIDED FURTHER that Acorn shall not be required to modify or
enhance the Documentation for the purpose of the escrow. The Parties
will make best efforts to negotiate an escrow agreement, prior to the
placement of the Source Code with the escrow agent. Under the terms of
such escrow agreement, Licensee shall have the right to obtain access to
such Source Code together with a copy of the documentation for the Source
Code solely for support purposes in the event that (i) Acorn materially
fails to comply with its support obligations pursuant to this Agreement;
or (ii) Acorn shall be declared insolvent by a court of competent
jurisdiction. Licensee acknowledges that such Source Code is proprietary
to Acorn and agrees to hold the same in the strictest confidence and not
use the same for any purpose whatsoever except as necessary for support
purposes.
4. Technical Assistance/Support
4.1 Acorn will timely provide Licensee with one copy of the
Documentation.
4.2 Subject to commercially reasonable resource availability and the
prior submission by Licensee of a purchase order in an agreed form Acorn
will timely provide development resources, training and technical
assistance to Licensee or its designated agents, covering the
understanding, utilization and support of the Technology. Any such
development work, technical assistance or support will be carried out on
a time and materials basis at the rate of [L900] per man per day plus
agreed expenses pursuant to the Conditions of Contract. In the event of
any inconsistency or conflict between the said Conditions of Contract
and any other provision of this Agreement, the latter shall prevail. The
provision of such support shall also be subject to the terms and
conditions specified in Schedule 6.
4.3 Acorn will timely provide RiscOS Development systems and tools as
ordered by Licensee at the lower of cost plus 25% handling charge or
Acorn Product International Distributor Price.
4.4 Any revisions to the Licensee Products delivered by Acorn to Licensee
pursuant to an agreement for support services shall be treated for all
purposes under this Agreement as Licensed Products and all Intellectual
Property Rights therein shall be retained by Acorn.
4.5 Licensee shall provide appropriate loaned hardware and software,
access to appropriate systems, test equipment and systems at Licensee
premises, and shall provide accurate and timely information to enable
Acorn to perform its obligations hereunder. The parties acknowledge that
the full co-operation of both is necessary to enable the proposed
development work to be completed within the target time scales.
4.6 The personnel of each party shall observe the notified security
regulations, working rules, work hours and holiday schedules and other
policies of the other party while working on the other's premises. Each
party agrees to co-operate fully and provide any assistance necessary to
the other in the investigation of any security breaches which may involve
its employees, agents or subcontractors. Either party may restrict the
other's access to its premises, as reasonably necessary, to ensure that
there will be no interruption or interference with normal business
activities. The assistance or presence of Licensee personnel shall not
relieve Acorn of its responsibilities under this Agreement, including the
responsibility to commit sufficient Acorn personnel to successfully
perform its obligations hereunder.
4.7 Acorn shall, whilst it continues to be contracted to undertake
development work for Licensee, provide Updates to Licensee free of charge
and may, at its sole discretion, provide Upgrades to Licensee without
charge.
5. Payment
5.1 Licence Fee
In addition to the fees payable pursuant to Clauses 2 and 4, in
consideration of the rights granted to Licensee in Clause 3, Licensee
shall pay to Acorn a non-refundable product development fee. The said
access licence fee shall be payable in two instalments. The first
instalment shall be paid on or before the
Effective Date and the second instalment shall be paid upon acceptance by
Licensee of Phase I pursuant to Clause 2.9.
5.2 Product Royalties
Licensee shall pay a royalty to Acorn in respect of every unit of
Licensee Product produced by Licensee or any Authorised Sublicensee in
accordance with Schedule 4.
5.3 Taxes
All payments required by this Agreement shall be made in Pounds Sterling
and are exclusive of non-UK taxes, and Licensee agrees to bear and be
responsible for the payment of all such taxes and duties which may be
levied or assessed in connection with this Agreement (excluding only
taxes based on Acorn's net income).
6. Additional Agreement of Parties
6.1 Notice of Breach or Infringement
Each party shall notify the other immediately in writing when it becomes
aware of any breach or violation of the terms of this Agreement, or when
Licensee becomes aware of any potential or actual infringement by a
third party of the Technology or Acorn's Intellectual Property Rights
therein.
6.2 Notices
Licensee shall not remove any copyright notices, trademark notices or
other proprietary legends of Acorn or its suppliers contained on or in
the Technology or Documentation. Each unit of Licensee Product
containing the Technology (or any part thereof) produced by (or with the
authorisation of) Licensee shall include in Licensee's (or other
manufacturer's) associated documentation notices substantially similar to
those contained on and in the Technology. Licensee shall incorporate in
every copy of the Technology, Source Code Material and Derivative Works
all the relevant Acorn copyrights, notices and marks.
6.3 Warranties to Third Parties
Licensee is not authorised to make any representation or warranty on
behalf of Acorn to third parties. Acorn shall not be responsible for
providing any support to any third party (including without limitation
Licensee customers).
6.4 Press Announcement
Licensee's and Acorn's initial press announcement concerning execution of
this Agreement must be approved in writing by the other party prior to
its release.
6.5 Use of Licensee's Name
Each party hereby authorises the other to use it's name in advertising,
marketing, collateral, customer lists and customer success stories
relating to the Technology or the Licensee Products, provided that the
other party will have the right to withdraw the authorisation for the
use of its name, such authorisation not to be unreasonably withdrawn.
Each party shall provide the other with a written copy of any such use.
6.6 Use of Trademarks
Licensee agrees that an Acorn Trademark (intended to take the form of a
peel-off sticker for front of bezel or swing-tag) shall be applied, in a
form and manner as may be mutually agreed to each Licensee Product
shipped by Licensee or Authorised Sublicensee. The Licensee Products, as
finally designed and built, may be sold under the Xxxxxx Mathesr label
and trademark. Neither party shall have any right, except as expressly
contained in this Agreement, to use any trademark or trade name of the
other unless the parties first enter into a formal licence for the use
of such trademarks with suitable provisions for quality control.
6.7 Compliance with Laws
Both parties shall comply with all relevant laws, rules, regulations,
governmental requirements in the exercise of its rights and performance
of its obligations pursuant to this Agreement.
7. Limited Warranty and Disclaimer
7.1 Limited Warranty
Acorn warrants to Licensee that:
(a) Acorn has not knowingly (but expressly without having undertaken any
searches for prior art) misappropriated from any third party any patent,
copyright, design right, registered design right, trademark or trade
secret in the development of the Technology; and
(b) as at the Effective Date Acorn has not received written notice of any
claim that the Technology infringes any third party intellectual
property; and
(c) Acorn has the right to enter into this Agreement; and
(d) the media on which the Technology is recorded will be free from
defects in materials and workmanship for a period of ninety (90) days
after delivery. Acorn's sole liability with respect to breach of this
warranty is to replace the defective media. Except as expressly provided
in this Section 7.1, Acorn provides the Technology and Documentation to
Licensee on an "AS IS" basis, subject to acceptance by Licensee pursuant
to Clause 2.9.
7.2 General Disclaimer
EXCEPT AS SPECIFIED IN THIS AGREEMENT, ALL EXPRESS OR IMPLIED
REPRESENTATIONS AND WARRANTIES, INCLUDING ANY IMPLIED WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR NON- INFRINGEMENT,
ARE HEREBY DISCLAIMED.
7.3 Limitation
The warranties set forth in this Clause 7 are expressly subject to
Section 10. (Limitation of Liability).
8. Confidential Information
8.1 The parties agree that all disclosures of Confidential Information
shall be governed and treated in accordance with the terms of the
Confidentiality Agreement (the "NDA") attached hereto as Exhibit A and
incorporated herein by reference, modified as follows:
(a) the definition of "Confidential Information" shall be as set forth in
Clause 1.5 notwithstanding any definition set forth in the NDA; and
(b) use of Confidential Information shall be limited to the scope of the
licences provided in this Agreement.
9. Limited Indemnity
9.1 The parties agree that Acorn shall not be liable for any defects or
deficiencies in the Licensee Product or any process or design created by
Licensee or other parties with or in connection with the Technology.
Acorn will, subject to the above exclusions, provide to Licensee a
limited indemnity as described in Clauses 9.2 - 9.5 below.
9.2 Acorn will defend, at its expense, any legal proceeding brought
against Licensee or any Authorised Sublicensee, to the extent it is based
on a claim that use of the Technology or Documentation in accordance with
the express provisions of this Agreement, is a direct infringement of a
copyright in any country which is a signatory to the Berne Convention or
infringes any other intellectual property rights of a third party, and
will pay all damages awarded by a court of competent jurisdiction
attributable to such claim, provided that Licensee: (i) provides notice
of the claim promptly to Acorn; (ii) gives Acorn sole control of the
defence and settlement of the claim; (iii) provides to Acorn at Acorn's
expense, all available information, assistance and authority to defend;
and (iv) has not compromised or settled such proceeding without Acorn's
prior written consent..
9.3 Should the Technology or any portion thereof become, or in Acorn's
reasonable opinion likely to become, the subject of a claim of
infringement for which indemnity is provided under Clause 9.2, Acorn
shall, as Licensee's sole and exclusive remedy, elect to: (i) obtain for
Licensee the right to use such Technology; (ii) replace or modify the
Technology to Licensee's reasonable satisfaction so that it becomes non-
infringing; or (iii) accept the return of the Technology and grant
Licensee a refund of all Licence fees and development fees paid to Acorn
by Licensee pursuant to this Agreement.
9.4 Acorn shall have no liability for any infringement or claim which
results from; (i) use of other than a current unaltered version of the
Technology, if such version was made available to Licensee; (ii) use of
the Technology in combination with any non-Acorn approved equipment,
software or data; or (iii) compliance with designs or specifications of
Licensee; if such infringement or claim would not have arisen in the
absence of circumstances specified in (i), (ii) or (iii) above.
9.5 NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT THIS CLAUSE 9
STATES THE ENTIRE LIABILITY OF ACORN WITH RESPECT TO INFRINGEMENT OF ANY
INTELLECTUAL PROPERTY RIGHTS ARISING FROM USE OR POSSESSION OF THE
TECHNOLOGY.
9.6 Indemnity by Licensee.
Licensee shall, at its expense subject to Clause 9.2 above, defend and
indemnify Acorn:
(a) from any and all claims brought against Acorn by third parties, and
shall pay all damages, awarded by a court of competent jurisdiction
attributable to such claims to the extent arising out of or in
connection with Licensee's use, reproduction or distribution of the
Technology or the Licensee Product except to the extent caused by Acorn's
negligence and wilful misconduct. Licensee's obligation to provide
indemnification under this Clause shall arise provided that Acorn; (i)
gives notice of the claim promptly to Licensee; (ii) gives Licensee sole
control of the defence and settlement of the claim; (iii) provides to
Licensee, at Licensee's expense, all available information, assistance
and authority to defend; and (iv) has
not compromised or settled such proceeding without Licensee's prior
written consent; and
(b) against any loss or damage suffered by Acorn as a result of a
material breach of this Agreement by Licensee.
10. Limitation of Liability
10.1 Limitation of Liability
Except for express undertakings to indemnify under this Agreement and/or
breach of Clauses 3, 8 or 9.2:
(a) Each party's liability to the other for claims relating to breach of
this Agreement, shall be limited to a sum equal to the total fees paid to
Acorn by Licensee pursuant to this Agreement.
(b) IN NO EVENT WILL EITHER PARTY BE LIABLE FOR ANY INDIRECT, INCIDENTAL,
SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES IN CONNECTION WITH OR ARISING
OUT OF THIS AGREEMENT (INCLUDING LOSS OF PROFITS, USE, DATA, OR OTHER
ECONOMIC ADVANTAGE), NO MATTER WHAT THEORY OF LIABILITY, EVEN IF
THEEXCLUSIVE REMEDIES PROVIDED FOR IN THIS AGREEMENT FAIL THEIR ESSENTIAL
PURPOSE AND EVEN IF EITHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OR
PROBABILITY OF SUCH DAMAGES. FURTHER, LIABILITY FOR SUCH DAMAGE SHALL BE
EXCLUDED, EVEN IF THE EXCLUSIVE REMEDIES PROVIDED FOR IN THIS AGREEMENT
FAIL OF THEIR ESSENTIAL PURPOSE. The provisions of this Clause 10.
allocate the risks under this Agreement between Acorn and Licensee and
the parties have relied upon the limitations set forth herein in
determining whether to enter into this Agreement.
10.2 High Risk Activities
The Technology is not fault-tolerant and is not designed, manufactured or
intended for use or resale as on-line control equipment in hazardous
environments requiring fail-safe performance, such as in the operation of
nuclear facilities, aircraft navigation or communication systems, air
traffic control, direct life support machines, or weapons systems, in
which the failure of the Technology or products incorporating the
Technology or any part thereof could lead directly to death, personal
injury, or severe physical or environmental damage ("High Risk
Activities"). Acorn specifically disclaims any express or implied
warranty of fitness for High Risk Activities. Licensee will ensure that
manufacturers customers and end-users of Licensee Products are provided
with a copy of the notice specified in the first sentence of this Clause
10.2.
11. Term and Termination
11.1 Term
The term of this Agreement shall begin on the Effective Date and shall
continue until terminated as provided below. Termination is permitted
either for material breach of this Agreement, upon thirty (30) days'
written notice to the other party and such party's failure to cure within
such thirty (30) day period, or upon any infringement by Licensee of
Intellectual Property Rights relating to the Technology.
11.2 Effect of Termination
In the event of termination of this Agreement by Acorn in accordance with
Clause 11.1 above, Licensee shall promptly return to Acorn all copies of
the Technology which remain in Licensee's possession or control and
provide Acorn with a written statement certifying that Licensee has
complied with the foregoing obligation except that Licensee may retain
one copy for archival purposes only which shall be used solely to
memorialize the scope of any confidential obligations it may have. All
rights and licenses granted to Licensee pursuant to Clause 3 shall
survive such termination unless it has arisen following an infringement
of Acorn's Intellectual Property Rights by Licensee in which event such
rights and licenses shall terminate upon such termination.
11.3 No Liability for Expiration or Lawful Termination
Neither party shall have the right to recover damages or to
indemnification of any nature, whether by way of lost profits,
expenditures for promotion, payment for goodwill or otherwise made in
connection with the business contemplated by this Agreement, due to the
expiration or permitted or lawful termination of this Agreement. EACH
PARTY WAIVES AND RELEASES THE OTHER FROM ANY CLAIM TO COMPENSATION OR
INDEMNITY FOR TERMINATION OF THE BUSINESS RELATIONSHIP UNLESS
TERMINATION IS IN MATERIAL BREACH OF THIS AGREEMENT.
11.4 No Waiver
The failure of either party to enforce any provision of this Agreement
shall not be deemed a waiver of that provision. The rights of Acorn and
Licensee under this Clause 11 are in addition to any other rights and
remedies permitted by law or under this Agreement.
11.5 Survival
The parties' rights and obligations under Clauses 5.2, 5.3, 6, 7, 8, 9,
10, 11, 12 and 13 shall survive expiration or termination of this
Agreement.
12. Records
12.1 Licensee shall keep proper books of accounts and records together
with copies of invoices and other relevant papers showing all orders
placed and executed in connection with the production and/or sale of
Licensee Products and shall allow a certified public accountant retained
by Acorn to have access to the said accounts records invoices and papers
for the purpose of auditing any information given by Licensee to Acorn
or of obtaining information or data relevant to the performance of the
rights and duties of Licensee under this Agreement at all reasonable
times (whether this Agreement be terminated or not) until all duties and
obligations of Licensee have performed and discharged in full. Any such
audit shall be permitted within thirty (30) days of Licensee's receipt
of Acorn's written request to audit, during normal business hours at a
time mutually agreed upon by Acorn and Licensee. Unless an underpayment
or mis-statement by Licensee is discovered during an audit, such audits
shall not take place more frequently than once in any twelve (12) month
period. Such accountant shall operate under Licensee's standard
confidentiality and non-disclosure agreement with Licensee whereby only
information related directly to the performance of the Licensee's
obligations pursuant to this Agreement may be disclosed to Acorn and
whereby no other information may be disclosed to any third party. Acorn
shall promptly provide Licensee with a copy of any written report or
other reports of the audit received by Acorn. The expense incurred in
such examination shall be paid by Acorn unless such examination reveals
that underpayment of fees by Licensee during the entire audited period
exceeds five percent (5%) of the amount of fees actually due during such
period, in which case Licensee shall pay or reimburse Acorn for the costs
of the audit in addition to additional royalties due.
12.2Acorn shall likewise furnish a certified public accountant retained
by Licensee upon request such accounting information and documentation as
may be reasonably necessary to audit and analyse the accounting records
of Acorn pertaining to charges and assessments made against advance
payments. Any such audit shall be permitted within thirty (30) days of
Acorn's receipt of Licensee's written request to audit, during normal
business hours at a time mutually agreed upon by Acorn and Licensee.
Such audits shall not take place more frequently than once in any twelve
(12) month period. Licensee shall promptly provide Acorn with a copy of
any written report or other reports of the audit received by Licensee.
13. Miscellaneous
13.1 Notices
All notices must be in writing and delivered either in person or by
certified mail or registered mail, postage prepaid, return receipt
requested, to the person(s) and address specified below or to such other
person or address as may hereafter be designated by either party pursuant
to the provisions of this Clause 13.1. Such notice will be effective upon
receipt.
Acorn Licensee
Acorn House Xxxxxx Xxxxxx Marketing Corporation
000 Xxxxxxxxx Xxxx 10911 Xxxxx Xxxxxx
Xxxxxxxxx Xxxxxx,
XX0 0XX, Xxxxxxx Xxxxx 00000, XXX
Attention: Company Secretary Attention: Chief Executive Officer
13.2 Partial Invalidity
If any term or provision of this Agreement is found to be invalid under
any applicable statute or rule of law then, that provision
notwithstanding, this Agreement shall remain in full force and effect
and such provision shall be deleted unless such a deletion would
frustrate the intent of the parties with respect of any material aspect
of the relationship established hereby, in which case, this Agreement and
the licences and rights granted hereunder shall terminate.
13.3 Complete Understanding
This Agreement and the Schedules and Exhibits hereto constitute and
express the final, complete and exclusive agreement and understanding
between the parties with respect to its subject matter and supersede all
previous communications, representations or agreements, whether written
or oral, with respect to the subject matter hereof. No terms of any
purchase order or similar document issued by either party shall be
deemed to add to, delete or modify the terms and conditions of this
Agreement. This Agreement may not be modified, amended, rescinded,
cancelled or waived, in whole or part, except by a written instrument
signed by the parties.
13.4 Language
This Agreement is in the English language only, which language shall be
controlling in all respects, and all versions of this Agreement in any
other language shall be for accommodation only and shall not be binding
on the parties to this Agreement. All communications and notices made or
given pursuant to this Agreement, and all documentation and support to be
provided, unless otherwise noted, shall be in the English language.
13.5 Governing Law
This Agreement is made under and shall be governed by and construed under
the laws of England and Wales and the parties hereto hereby irrevocably
submit to the non-exclusive jurisdiction of the High Court of Justice in
London for the purpose of hearing and determining any dispute arising
out of this Agreement.
13.6 Disclaimer of Agency
The relationship created hereby is that of licenser and licensee and the
parties hereby acknowledge and agree that nothing herein shall be deemed
to constitute either party as an agent of the other.
13.7 Assignment
This Agreement may not be assigned by either party without the prior
written consent of the other party, which consent shall not be
unreasonably withheld or delayed, except that Acorn may assign this
Agreement to its holding company or a majority-owned subsidiary.
13.8 Construction
This Agreement has been negotiated by Acorn and Licensee and by their
respective counsel. This Agreement will be fairly interpreted in
accordance with its terms and without any strict construction in favour
of or against either party.
13.9 Force Majeure
Except for the obligation to pay money, neither party shall be liable to
the other party for non-performance of this Agreement, if the non-
performance is caused by events or conditions beyond that party's
control and the party gives prompt notice under Clause 13.1 and makes all
reasonable efforts to perform.
13.10 Schedules
The following are included herein by reference as integral parts of this
Agreement:
Schedule 1 - Documentation
Schedule 2 - Technology Specification, Source Material and RiscOS
Development System configuration
Schedule 3 - CM Implementation
Schedule 4 - Product Royalties
Schedule 5 - Technical Proposal - Hardware Functional
Specification/Software Functional Specification
Schedule 6 - Support
Exhibit A - NDA
Exhibit B - Conditions of Contract
13.11 Clause References
Any reference contained herein to a clause of this Agreement shall be
meant to refer to all sub-sections of the clause.
13.12 No Competitive Restrictions
The Parties agree that nothing in this Agreement is intended to prohibit
Licensee from independently developing or acquiring technology which is
the same as or similar to the Technology, provided that the Licensee
does not do so in breach of Exhibit A to this Agreement.
13.12 Poaching Restriction
(a) Acorn undertakes that during the continuance of this Agreement and
for a period of one year thereafter neither Acorn or its holding company
or any company controlled by Acorn or its holding company shall recruit,
hire or solicit for employment any member of Licensee's personnel who
has, during the twelve month period preceding any such recruitment,
hiring or solicitation, been engaged or associated with the exercise or
performance of the Licensee's rights or obligations under this
Agreement.
(b) Licensee undertakes that during the continuance of this Agreement and
for a period of one year thereafter neither Licensee or its holding
company or any company controlled by Licensee or its holding company
shall recruit, hire or solicit for employment any member of Acorn's
personnel who has, during the twelve month period preceding any such
recruitment, hiring or solicitation, been engaged or associated with
Acorn's performance of its obligations contained in this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorised representatives.
Acorn Computers Limited: Xxxxxx Xxxxxx Marketing Corporation:
By:_____/s/ DDicken____________ By: _____/s/ Xxx Custer_________
Name: _____David Dicken________ Name: ___Patrick A. Custer________
(Print or type) (Print or type)
Title:_Business Development Manager_ Title:______President___________
Date:____20 Feb 1997_______ Date:_______2/20/97_____________
Schedule 1
(Documentation)
Complete xxxx of materials
Gerber files for circuit boards
Complete set of assembly drawings
Service manual information
Information required for governmental regulatory approval
Schematic diagrams
Hardware and software specifications together with any other
appropriate documentation which is reasonably necessary to provide
Licensee with sufficient time to arrange for the manufacture of Licensee
Products to meet the product delivery schedules set out in this
Agreement.
Part II (Source Code Material)
The initial release and phased update (as defined by Acorn) of the C
Source Code for the Acorn !Browse Application which provides World Wide
Web browsing functionality as referenced in Schedule 5 which will be
more particularly defined in an Funtional Specification plus any other
Source Code which Acorn believes is necessary to enable Licensee to
incorporate the Technology within a Licensee Product.
Schedule 3
(CM Implementation)
1. ROM Image
The specific implementation of RiscOs and all necessary extensions which
provide the functionality specified in Schedule 5 which will be more
particularly defined in a Functional Specification and which contains the
ASCI representation 'RISC OS 3.6CM'.
2. PCB Layout
The Gerber files which defined the PCB layout artwork which provides the
hardware functionality specified in Schedule 5 and which is annotated
with the phrase 'Acorn-Xxxxxx Xxxxxx Issue ', where represents
the release level of the artwork supplied for acceptance.
Schedule 6
(Support)
1. Acorn's Obligations
Acorn shall provide the following support services in respect of
Technology:
1.1 Problem reporting, tracking and monitoring by electronic mail:
All faults to be reported by Licensee in the following standard format:
FAULT REPORT
Submitted by: [NAME]
Reference: [Reference]
Severity: [Severity -Urgent|High|Low] (as defined
below
Repeatability: [Always|Frequently|Occasionally|Once]
(as defined below)
Supporting files: [No|Yes]
Hardware: [ ]
OS version: [3.60CM]
Memory size: [ ]
Monitor: [ ]
Software under test: [ ]
Release: [ ]
Software exhibiting fault: [ ]
Software version: [ ]
Component at fault: [ ]
Component version: [ ]
Summary: [Summary]
Severity
Urgent - Crashes O/S leading to data loss
High - Major functionality unuseable
- Crashes application in normal use
- Crashes O/S under unusual use
- Loss of user data
- Inaccurate documentation leading to
data loss
Low - Minor functionality unuseable or
impaired
- Crashes application under unusual use
- Inaccurate or imprecise documentation
Repeatability
Always - Happens every time a certain set of
actions is followed
Frequently - Happens often (though no tried and
tested set of actions)
Occasionally - Happened more than once but not easily
reproducible
Once - Happened once but haven't been able to
reproduce
1.2 Telephone, fax and email support for problem determination,
verification and resolution on a call-back basis during Acorn's normal
weekday business hours, excluding all holidays observed by Acorn.
1.3 Consultancy support for the integration of Upgrades and Updates into
Licensee Products,
1.4 Providing the maintenance and technical support described above, for
the current release level of the Technology.
1.5 Working diligently to promptly resolve defects and errors in the
Technology and using commercially reasonable efforts to comply with the
following target schedule:
ERROR SEVERITY (1) RESPONSE (2) CLOSURE(3)
Urgent 24 hours 7 days
High 2 days 14 days
Low 30 days Next Update
(1) Severity: As defined in the fault report.
(2) Response: Response consists of providing, as appropriate, one of the
following: an existing correction; a new correction; a viable work
around; a request for more information to complete analysis of the
problem, or a proposal outlining how the problem will be corrected.
(3) Closure: Closure consists of providing an appropriate correction
pursuant to 2 above (Response) or alternatively a final correction or
work around of the problem including Updates and revised
Documentation as necessary.
In the event that Licensee falsely classifies the severity of any
fault, thereby obtaining an accelerated Response, Acorn reserves the
right to co-ordinate with the Licensee to reclassify the fault.
2. Licensee Obligations
Licensee agrees:
2.1 that the Designated Contact person(s) identified below (or such other
replacement individual as Licensee may designate) shall be the sole
contact for the coordination and receipt of the support services referred
to in Clause 1 of this Schedule 6, which person shall be knowledgeable
and trained in the use of the Technology;
2.2 to maintain an electronic mail link-up with Acorn via the Internet;
2.3 to provide accurate fault reports and reasonable supporting data to
aid in the identification of reported problems.
3. Licensee Designated Contacts:
Primary Contact: [contact 1]
Phone number: [phone 1]
Fax number: [fax 1]
E-Mail address: [E-Mail 1]
Secondary Contact: [contact 2]
Phone number: [phone 2]
Fax number: [fax 2]
E-Mail address: [E-Mail 2]
4. Acorn Designated Contacts:
Primary Contact: Fax number:
Phone number: E-Mail address:
Secondary Contact: Fax number:
Phone number: E-Mail address:
