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EXHIBIT 10.21
DEVELOPMENT AND LICENSE AGREEMENT
THIS DEVELOPMENT AND LICENSE AGREEMENT (the "Agreement") is made as of
May 17, 1999 (the "Effective Date"), between Wink Communications, Inc., a
California corporation with offices at 0000 Xxxxxx Xxxxxxx Xxxxxxx, Xxxxxxx, XX
00000 ("Wink") and Thomson Consumer Electronics, Inc., a Delaware corporation,
with offices at 00000 X. Xxxxxxxx Xxxxxx, Xxxxxxxxxxxx, XX 00000
("Manufacturer").
BACKGROUND
A. Wink is a software developer that has developed an end-to-end system
for delivering interactive applications synchronized with or independent of
television programs and advertisements. Among other software, Wink develops,
customizes, supports and licenses its software engine (the "Wink Engine") that
decodes Wink's interactive applications written to Wink's protocol ("Interactive
Wink Programs") and displays the interactive applications overlaid on a
television screen.
B. DIRECTV, a California corporation ("DIRECTV"), whose address is 0000
Xxxx Xxxxxxxx Xxxxxxx, Xx Xxxxxxx, XX 00000 and Wink have entered into a license
agreement (the "Master Agreement") under which DIRECTV has licensed certain
software from Wink and has agreed to transmit Interactive Wink Programs that can
be decoded and displayed by a Wink Engine resident in a DIRECTV System Receiver
(as defined below).
C. Manufacturer is a manufacturer of television set top boxes and video
products, and has a valid and current license with DIRECTV to produce and
distribute devices incorporating DIRECTV technologies and capable of receiving
and decoding DIRECTV signals ("DIRECTV System Receivers").
D. Wink and Manufacturer desire that Wink grant to Manufacturer the
right to embed a customized version of the Wink Engine on DIRECTV System
Receivers to be distributed in North America.
AGREEMENT
1. DEFINITIONS
1.1 "ICAP" means the Interactive Communicating Applications
Protocol developed by Wink. ICAP defines a method for delivering self-contained,
compact, platform independent, graphical Interactive Wink Programs which are
decoded and executed by the Wink Engine in the Combined Product.
1.2 "Wink Engine" means Wink's proprietary platform- and user
interface-independent software engine that implements Wink's Interactive
Communicating Applications Protocol for the interpretation of Interactive Wink
Programs.
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1.3 "Statement of Work" means one or more document(s) to be
mutually agreed upon and executed by the parties and attached as Exhibit A (and
numbered successively, X-0, X-0, etc.) setting forth the Development Plan,
Specifications, Deliverables, each party's respective development obligations,
payment and related terms and conditions with respect to each Manufacturer
product for which the Wink Engine is customized and each development project
undertaken otherwise relating to customize the Wink Engine.
1.4 "Development Plan" means the schedule and plan for
completion of the development activities under this Agreement as set forth in
the Statement of Work.
1.5 "Specifications" means the technical and other
specifications for the Deliverables to be developed by the parties under this
Agreement as set forth in a Statement of Work.
1.6 "Deliverable" means each item identified as a deliverable
in a Statement of Work.
1.7 "Licensed Engine" means version 2.0 of the Wink Engine as
customized under a Statement of Work in object code format and any Updates, and
any related documentation which Wink may create.
1.8 "Update" means a release of the Licensed Engine which
contains error corrections or minor enhancements, but which is not a new version
containing a significant new feature or functionality, in each case as
determined with Manufacturer's agreement. An Update shall be designated by a
change in the digit or digits only to the right of the decimal point in the
version number. Both parties intend to minimize the number of Updates released
in a given year by exercising reasonable efforts to group enhancements into a
single Update.
1.9 "Combined Product" means a DIRECTV system receiver
containing the Licensed Engine or by agreement between the parties a DIRECTV
system receiver designed to receive the Licensed Engine via download and which
is able to receive both DIRECTV programming and Interactive Wink Programs
transmitted by DIRECTV.
1.10 "Subdistributors" means entities authorized by
Manufacturer to distribute the Combined Product(s) including subsidiaries,
affiliates, distributors, resellers, value-added resellers, dealers or sales
representatives.
1.11 "Intellectual Property Rights" means all current and
future worldwide patents and other patent rights, copyrights, mask work rights,
trade secrets, know-how and all other intellectual property rights, including
without limitation all applications and registrations with respect thereto.
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2. DEVELOPMENT, DELIVERY AND ACCEPTANCE
2.1 Development. Wink agrees to use reasonable commercial
efforts to customize the Wink Engine for the Combined Product identified in the
Statement of Work or to complete any additional development of a Licensed Engine
after Final Acceptance as defined and set forth in a respective Statement of
Work. The terms of this Agreement shall apply to all such development efforts
except to the extent expressly set forth in a Statement of Work.
2.2 Cooperation and Assistance. Manufacturer shall (i) assist
Wink in producing the Specifications and (ii) provide other reasonably necessary
materials and information, as specifically agreed upon by the parties in the
Development Plan.
2.3 Provision of Software, Hardware and Equipment.
Manufacturer shall provide to Wink free of charge (including all taxes and
freight) all DIRECTV System hardware and software reasonably necessary for Wink
to complete development ("Equipment"). A preliminary list of Equipment shall be
included in each Statement of Work and may be updated from time to time by
mutual agreement. Manufacturer shall retain title to all such Equipment provided
to Wink, and Wink shall return all such Equipment to Manufacturer upon
expiration or termination of this Agreement. Manufacturer shall bear all freight
and other costs associated with such return of Equipment by Wink. Wink shall
exercise the same degree of care with the Equipment as Wink does for its own
equipment. Wink shall provide to Manufacturer free of charge (including all
taxes and freight) all Wink-related hardware and software necessary for
Manufacturer to complete development and testing of the Wink Engine, excluding
"Bit Stream Generator" hardware and software from Doctor Design Inc. ("DDI") and
companies affiliated with DDI, and specifically including a Wink server to be
indefinitely located at Manufacturer's premises ("Wink Equipment"). A
preliminary list of Wink Equipment shall be included in each Statement of Work
and may be updated from time to time by mutual agreement. Wink shall retain
title to all such Wink Equipment, and Manufacturer shall return all such Wink
Equipment to Wink upon expiration or termination of this Agreement. Wink shall
bear all freight and other costs associated with such return of Wink Equipment
by Manufacturer. Manufacturer shall exercise the same degree of care with the
Wink Equipment as Manufacturer does for its own equipment.
2.4 Modifications. Wink may alter the Specifications
commensurate with good faith efforts to finalize and refine the Deliverables in
accordance with Manufacturer's needs and objectives for the Licensed Engine and
subject to DIRECTV's and Manufacturer's written permission. Any such changes
will be documented in writing and provided to Manufacturer. Any changes to a
Statement of Work may only be made by mutual agreement of the parties, and all
provisions and/or Deliverables affected by such changes shall be appropriately
adjusted.
2.5 Delays. In the event either party is late in the
performance of its obligations in accordance with the Development Plan
(including the DIRECTV network development) and such delay affects the other
party's obligations hereunder, the other party's performance of such affected
obligations shall be delayed by the time period necessary to account for such
delay.
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2.6 Delivery and Acceptance. Upon completion, Wink shall
deliver to Manufacturer each Deliverable. Accompanying the final Deliverable for
a given Statement of Work, Wink shall include test criteria that will exercise
critical functionality of such Deliverables. Test criteria will include test
cases and test applications that test for cross-platform compatibility's and for
Manufacturer-specific implementation features. Within thirty (30) days after
receipt, Manufacturer shall review and evaluate each Deliverable according to
Wink's and Manufacturer's agreed upon test criteria if applicable and shall
provide Wink with a written acceptance of the Deliverables or a written
statement setting forth those material errors to be corrected ("Statement of
Errors"). Manufacturer shall not withhold acceptance of any Deliverable unless
such Deliverable deviates from the Specifications, and can reasonably be
classified as a level 2 or higher error. Errors will be classified as follows:
LEVEL 1: Errors that may deviate from the specification slightly, but do not
result in noticeable degradation in performance of the Wink Engine, or in the
Wink Engine's ability to process Interactive Wink Programs. Noticeable shall be
defined as degradation that would be likely to be noticed by a residential
customer. LEVEL 2: Errors that result in noticeably reduced performance of the
Wink Engine LEVEL 3: Errors that result in lost features or inoperability of the
Wink Engine.
Wink and Manufacturer recognize that the Deliverables will not
be error-free. If Manufacturer provides a Statement of Errors, Wink shall use
reasonable commercial efforts to correct such errors as are validated by Wink,
as soon as practicable, and to return a copy of the updated Deliverables to
Manufacturer for review and reevaluation. In the case that Wink is unable to
validate an error identified by the Manufacturer, the parties agree to work in
good faith to jointly validate the error and identify a course of action to
resolve the issue. The foregoing procedure shall be repeated until acceptance by
Manufacturer of the Deliverables or the parties mutually agree to cease
development and terminate this Agreement or the applicable Statement of Work.
Manufacturer's failure to accept or provide a Statement of Errors within such
thirty day period shall be deemed an acceptance of such Deliverables. The
parties agree that additional testing performed in conjunction with DIRECTV or
its designated party may be required, and agree to include an estimate of the
time and effort involved in such testing in the Statement of Work.
2.7 Transfer of Software. Upon Manufacturer's acceptance of
the completed Licensed Engine ("Final Acceptance"), Wink shall deliver to
Manufacturer a master diskette or other digital storage media as requested by
Manufacturer for use by Manufacturer in accordance with the terms of this
Agreement.
2.8 Right to Pursue Other Projects. Wink is in the business of
developing and modifying the Wink Engine for itself and for others. This
Agreement shall not be construed as prohibiting Wink from granting rights to the
Licensed Engine to third parties or Wink's further development, modification or
distribution of the Wink Engine.
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3. GRANT OF RIGHTS
3.1 Licensed Engine. Subject to the terms and conditions of
this Agreement, effective upon Final Acceptance, Wink grants to Manufacturer a
non-exclusive, non-transferable (except as provided in Section 13.3), right and
license, under Wink's Intellectual Property Rights in the Licensed Engine, to
(a) use, reproduce and have reproduced the Licensed Engine, solely for the
purpose of incorporating the Licensed Engine into a Combined Product and as
necessary in the course of distribution and support of the Combined Product as
permitted hereunder and (b) distribute and sell the Combined Product in the
United States of America.
3.2 Submanufacturers. Manufacturer shall have the right to
provide the Licensed Engine to its third party manufacturers (each a
"Submanufacturer"), provided that each Submanufacturer agrees in a signed
writing (i) to use and reproduce Licensed Engines and Combined Products only for
Manufacturer's account, (ii) not to sell or distribute Licensed Engines and
Combined Products except to Manufacturer, (iii) to keep the Licensed Engine
confidential pursuant to terms and conditions no less restrictive than the terms
and conditions described in Section 10 below and (iv) that Wink is a third party
beneficiary of such agreement and may enforce such agreement directly against
such Submanufacturer. Manufacturer's provision of the Licensed Engine to such
Submanufacturer shall in all instances be subject to (a) Manufacturer's
assurance that it will use the same level of care in choosing Submanufacturers
for Combined Products incorporating the Licensed Engine as it does for its other
products, and will take all reasonable steps to prevent unauthorized disclosure
of Wink Confidential Information, and (b) Manufacturer's prompt notification to
Wink if Manufacturer knows or believes that a Submanufacturer has breached the
provisions of subsection (i) - (iii) above. In the event that Manufacturer
desires to provide the Licensed Engine to a Submanufacturer without also
providing such Submanufacturer with software owned by Manufacturer,
Manufacturer's provision of the Licensed Engine to such Submanufacturer shall be
subject to Wink's written approval (not to be unreasonably withheld) of such
Submanufacturer. Manufacturer shall use commercially reasonable efforts to
ensure that all Submanufacturers abide by the terms of their written agreements
described herein and keep Wink apprised of its activities in enforcing such
agreements.
3.3 Subdistributors. Manufacturer may exercise its
distribution rights hereunder through the use of Subdistributors. However,
Manufacturer may not, without written approval from Wink, sub-license or provide
for the distribution of the Combined Product by any OEM that is in the business
of branding and distributing consumer electronics products.
3.4 Proprietary Notices. All copies of the Licensed Engine
reproduced or distributed by Manufacturer shall contain copyright and other
proprietary notices in the same manner in which Wink incorporates such notices
in the Licensed Engine or in any other manner requested by Wink. Wink's current
copyright and proprietary notices are set forth in Exhibit B. In addition, at
Wink's reasonable request, Manufacturer shall xxxx the Combined Product with
such patent notices as may be permitted or required under Xxxxx 00, Xxxxxx
Xxxxxx Code. Manufacturer shall use reasonable efforts to promptly incorporate
such notices after Wink provides the form of notice.
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3.5 Limitations. Manufacturer shall not modify, prepare
derivative works of, reverse engineer, disassemble, de-compile, or otherwise
attempt to obtain access to the source code of the Licensed Engine.
4. FEES
4.1 License Fees. Wink agrees that there shall be no per copy
license fee or other license fee due Wink in connection with Manufacturer's
license of the Licensed Engine.
Manufacturer agrees to ship at least 250,000 units of the
Combined Product to Subdistributors in calendar year 1999. Manufacturer also
agrees to use reasonable efforts to meet its portion of the Statement of Work
for timely delivery of the Wink Engine download. Manufacturer is not responsible
for delays outside of the scope of their responsibilities as identified in the
Statement of Work. However, Manufacturer will use reasonable efforts to avoid
delays associated with new features or functionality, other than the Wink
Engine, which DIRECTV chooses to include in the download.
5. WARRANTY
5.1 Product Warranty. Wink warrants to Manufacturer that under
ordinary use the Licensed Engine shall function in Manufacturer's Combined
Products in conformance with the Specifications, excluding jointly accepted
LEVEL 1 deviations as defined in Section 2.6.
5.2 Defects not Covered by Warranty. Wink's warranty shall not
extend to problems in the Licensed Engine that result from:
(i) Manufacturer's failure to implement any Updates
to the Licensed Engine which are provided by Wink and accepted by DIRECTV;
(ii) changes to the operating system after the Final
Test which adversely affect the Licensed Engine;
(iii) any alterations of or additions to the
Licensed Engine performed by parties other than Wink or without Wink's prior
written authorization;
(iv) use of the Licensed Engine in a manner
inconsistent with the Specifications, or
(v) combination of the Licensed Engine with other
products not supplied by Wink or specifically identified in the applicable
Specifications as compatible with the Licensed Engine, which problems do not
affect the Licensed Engine standing alone.
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5.3 Wink represents and warrants to Manufacturer that the
Licensed Engine is designed and developed to be and will continue to be Year
2000 Compliant. "Year 2000 Compliant" shall mean that:
(a) the Licensed Engine is fully functional and performs
in accordance with Wink's Specifications and the specific warranties set forth
elsewhere in this Agreement (together, the "Standards") prior to, during, and
after the calendar year 2000 A.D., and that the Licensed Engine shall perform
during each such period of time without any error relating to date functionality
and/or data;
(b) without limiting the generality of the foregoing, that
the Licensed Engine: (i) shall not cease to perform or provide or cause any
software and/or system with which the Licensed Engine operates to provide
invalid or incorrect results as a result of date functionality and/or data, or
otherwise experience any degradation of performance or functionality with
respect to the Standards as a result of such interfacing specifically arising
from, relating to or including date functionality, (ii) has been developed and
designed to be fully interoperable with year 2000-compliant software, hardware,
and data and to ensure year 2000 compatibility, including, but not limited to,
date data century recognition and calculations which accommodate same century
and multi-century and leap year formulas and date values; (iii) shall
effectively and accurately manage and manipulate data derived from, involving or
relating in any way to dates including single century formulas and multi-century
or leap year formulas, and will not cause an abnormally ending scenario within
the Licensed Engine, or generate incorrect values or invalid results involving
such dates, and (iv) provides that all date-related user interface
functionalities and data fields include an indication of century.
5.4 Exclusive Remedy. Wink's sole obligation and
Manufacturer's exclusive remedy under the above warranties shall be for Wink to
use commercially reasonable efforts at Wink's or Manufacturer's facilities to
correct reproducible errors in the Licensed Engine necessary to bring it into
conformity with Wink's Specifications. In the case that Wink is unable to
validate an error identified by the Manufacturer, the parties agree to work in
good faith to jointly validate the error and identify a course of action to
resolve the issue.
5.5 Disclaimer. EXCEPT FOR THE ABOVE EXPRESS WARRANTIES AND AS
PROVIDED IN SECTION 11, WINK MAKES AND MANUFACTURER RECEIVES NO WARRANTIES WITH
RESPECT TO THE LICENSED ENGINE, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, AND
WINK SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTIES OF MERCHANTABILITY, OR
FITNESS FOR A PARTICULAR PURPOSE. Wink does not warrant that operation of the
Licensed Engine will be error free.
6. PROPERTY RIGHTS
Manufacturer agrees that as between Manufacturer and Wink,
Wink owns all right, title and interest in the Licensed Engine and all
modifications and derivatives thereof including all Intellectual Property
Rights. Except as expressly provided in Section 3, Wink does not grant to
Manufacturer any right, title or interest in the Licensed Engine, whether by
implication, estoppel or
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otherwise. All rights with respect to the Licensed Engine not specifically
granted herein are reserved to Wink.
7. MARKETING; TRADEMARKS AND TRADE NAMES
7.1 Use of Trademarks.
7.1.1 Promotion and Advertising. During the term of this
Agreement, in the event that Manufacturer or any Subdistributor advertises,
promotes or markets the functionality of the Licensed Engine, Manufacturer may,
and may require its Subdistributors to, use the trademarks, marks, trade names,
logos, and other product and company identifiers of Wink that Wink may adopt,
from time to time ("Wink Trademarks"). Use of the Wink Trademarks shall be
consistent with Wink's trademark usage policy which Wink may adopt from time to
time and of which Wink has notified Manufacturer. Manufacturer and its
Subdistributors may use trade names, marks or trademarks in addition to the Wink
Trademarks in connection with the Combined Product.
7.1.2 Approval of Representations. All representations of
Wink Trademarks that Manufacturer or its Subdistributors intend to use shall
first be submitted to Wink for approval (which shall not be unreasonably
withheld) of design, color, and other details, or shall be exact copies of those
used by Wink. To ensure trademark quality, within a reasonable time prior to
Manufacturer's first commercial shipment of the Combined Product bearing one or
more Wink Trademarks, Manufacturer shall supply to Wink one such Combined
Product for inspection by Wink to ensure that such Combined Product conforms to
Wink Trademarks guidelines. In no event shall Manufacturer commence commercial
shipment of any such Combined Product (except as set forth above) under the Wink
Trademarks without Wink's prior written approval. Unless Manufacturer receives
written notice from Wink within ten (10) business days after delivery of such
inspection unit to Wink that Manufacturer's use of the Wink Trademarks is not
consistent with Wink's Trademark guidelines, Wink's approval of Manufacturer's
use of the Wink Trademarks shall be deemed to have been granted.
7.1.3 Restrictions. At no time during or after the term
of this Agreement shall either party register, attempt to register or cause the
registration of any of the trademarks of the other party which give rise to the
likelihood of confusion. Except as expressly set forth herein, nothing herein
shall grant to either party any right, title or interest in the other party's
trademarks. At no time during or after the term of this Agreement shall either
party challenge or assist others to challenge the other party's trademarks or
the registration thereof or attempt to register any trademarks, marks or trade
names confusingly similar to those of the other party.
7.2 Marketing and Promotion. Manufacturer shall promote the
functionality of the Licensed Engine in its presentations to customers and in
its marketing materials as a prominent feature of the Combined Product.
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7.3 Wink Markings and User Interface Elements.
7.3.1 Remote Button. All remote controls that the
Manufacturer markets for use with Combined Products shall contain a button
dedicated for enabling the functionality of the Licensed Engine ("Wink Button")
when Wink applications are present on-screen. This button may have other
functions when Wink applications are not present. This button will include a
marking chosen by Wink for placement on or adjacent to the Wink button. For each
remote, the location and size of the Wink button shall be mutually agreed upon,
but shall be as prominent as buttons and markings for other features such as
"menu", "info", "guide", "OK".
7.3.2 Manuals. Manufacturer shall ensure that printed
manuals, or any other documentation describing functionality of the Licensed
Engine will contain information on use of the Licensed Engine functionality and
Wink copyright and proprietary notices. The content and location of such
information and notices shall be mutually agreed upon, but shall be in the same
place, the same size and same prominence as similar information for other
functionality.
7.3.3 Device Specific and On-screen Information. Wink will
provide to Manufacturer artwork for a logo that may be placed on all Combined
Products. Manufacturer may silk screen or similarly affix this logo on each
Combined Product. Manufacturer shall ensure that: (i) if a Combined Product has
a menu system, a menu item will be reserved for Wink, which will allow users to
access information regarding the Licensed Engine functionality, the content of
screen and name of menu item in menu shall be mutually agreed upon in the
Statement of Work; and (ii) if a Combined Product has the capability to display
help screens that include descriptions of device or remote control
functionality, information regarding Licensed Engine functionality shall be
provided, the content and style of such information shall be mutually agreed to
by the parties.
7.4 Press Releases. The parties intend to cooperate and participate
in public relations programs to promote the Combined Products. Appropriate
personnel from each party shall participate in such public relations programs.
The parties shall cooperate with respect to and mutually approve (not to be
unreasonably withheld or delayed) all press releases issued by either party with
respect to this Agreement. Unless otherwise agreed in writing by the parties,
each press release issued pursuant to this Section shall contain: (i) in the
body of the release, the name and location of both parties and a quote from an
executive of both parties; (ii) in a footnote at the end of the release, both
parties' proprietary notices with respect to technology discussed in the body of
the release. Whenever feasible, the press release shall also include the logo of
each party.
7.5 Disclosures of Terms. Each party agrees not to disclose the
terms of this Agreement to any third party without the other's written consent
in its sole discretion, except to such party's accountants, attorneys and other
professional advisors, or as required by securities or other applicable laws;
provided, however, that the parties agree that DIRECTV, Inc. shall be provided
with an executed copy of the Specifications, and all schedules, attachments and
exhibits attached hereto, within thirty (30) days of the Effective Date.
Notwithstanding this paragraph, each party shall have the right to say the
following in meetings with customers, prospective customers, or prospective
investors:
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- Manufacturer and Wink are working together.
- Manufacturer is licensing Wink's technology.
- Wink is porting the Wink Engine to Manufacturer set-tops.
8. TRAINING, SUPPORT AND MAINTENANCE
8.1 Maintenance. Wink agrees to make available to
Manufacturer, at no charge to Manufacturer, all Updates released by Wink and
permit Manufacturer to distribute Updates to its Subdistributors and
Submanufacturers for their use consistent with this Agreement. Manufacturer
shall promptly notify its Submanufacturers and Subdistributors of the
availability of each Update and Manufacturer shall require its Submanufacturers
and shall use reasonable commercial efforts to require its Subdistributors to
promptly begin using each such Update in place of the previous version of the
Licensed Engine. Manufacturer shall be responsible for making such Updates
available to its customers.
8.2 Technical Support. Wink shall make available to
Manufacturer, at no charge to Manufacturer, technical support, as set forth in
Exhibit C. Wink may subcontract its technical support obligations and shall
notify Manufacturer as to the appropriate contact to obtain support.
8.3 Technical Training. Wink shall make available, at Wink's
facilities and at Wink's expense, technical training for Manufacturer's
employees as requested by Manufacturer, but not to exceed three (3) employees
per calendar year. Wink will train additional employees at rates and costs
agreed upon, but not to exceed $1,000 per person per day.
8.4 Sales Training. Wink shall provide training as requested
by Manufacturer at Manufacturer's national sales meeting or another training
session to be identified by Manufacturer. Any additional sales training will be
subject to mutual agreement of the parties.
8.5 Travel Requirements. Each party shall be responsible for
its own travel expenses. The parties agree to use reasonable efforts to
alternate meetings between each party's facilities.
9. TERM AND TERMINATION
9.1 Term. This Agreement shall commence on the Effective Date
and shall continue in full force and effect until the earlier of (a) five (5)
years from the first commercial shipment of Combined Product by Manufacturer, or
(b) the expiration of the Master Agreement (the "Term"). The Term may be
extended by mutual agreement of the parties. Notwithstanding the foregoing, if
the Master Agreement is extended, this Agreement shall be automatically extended
until the Master Agreement lapses or is terminated. Wink agrees to provide
written notice to Manufacturer in the event of any such extension of the Master
Agreement.
9.2 Termination for Cause. If either party materially defaults
in the performance of any provision of this Agreement, the non-defaulting party
may give written notice to the defaulting party that if the default is not cured
within thirty (30) days this Agreement shall be
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immediately terminated. For the purposes of determining a material default by
Wink based on late or non-delivery of a Deliverable, Wink shall not be in
material default of this Agreement unless it fails to deliver a Deliverable
within sixty (60) days of the date such Deliverable is due.
9.3 Termination for Insolvency. Either party may terminate
this Agreement upon written notice upon: (i) the institution by or against the
other party of insolvency, receivership or bankruptcy proceedings or any other
proceedings for the settlement of the other party's debts, (ii) the other
party's making an assignment for the benefit of its creditors, or (iii) the
other party's dissolution or ceasing to conduct business as a going concern.
9.4 Effect of Termination. Upon the expiration or termination
of this Agreement, the following provisions shall take effect:
9.4.1 Subject to the provisions of Section 9.5, the
rights and licenses granted to Manufacturer under this Agreement shall
automatically terminate, and Manufacturer shall immediately cease distribution
of Licensed Engines and use of the Wink Trademarks, provided, however, that if
the Agreement is terminated by Manufacturer due to Wink's material breach or
insolvency, Manufacturer may, at its option, continue to use, reproduce, and
distribute the Licensed Engine under the right and license granted hereunder;
9.4.2 Rights of end users to use the Licensed Engine as
part of a Combined Product shall continue in effect;
9.4.3 Within ten (10) days after such expiration or
termination, except as provided in Section 9.6, or the case where Manufacturer
elects to continue the license pursuant to Section 9.4.1 above, Manufacturer
shall return, and shall certify to Wink the return of, all copies of the
Licensed Engine and all Wink Confidential information (as defined in Section
10.1) in its or its Submanufacturers' possession at the time of expiration or
termination. Wink shall return, and shall certify to Manufacturer the return or
destruction of, all Manufacturer Confidential Information in its possession at
the time of expiration or termination. Notwithstanding the foregoing,
Manufacturer may, except upon termination by Wink: (i) maintain a single copy of
the Licensed Engine and (ii) retain any Confidential Information necessary for
support, subject to the provisions of Section 10, solely to provide support to
its permitted Subdistributors and end users.
The parties agree to enter into a source code escrow
agreement with a mutually selected escrow agent. Wink agrees to deposit the Wink
Engine source code upon final technical acceptance of the Wink Engine by
Manufacturer. Manufacturer shall be entitled to the release of such source code
during any time period in which: (i) Wink is subject to the jurisdiction of any
bankruptcy court or (ii) Wink is in material breach of the provisions of section
5, which material breach has not been cured within thirty (30) days after
Manufacturer's written notice to Wink thereof. The foregoing is subject,
however, to the condition that Manufacturer is not at that time in material
breach of any of its obligations under this Agreement, and such breach has not
been cured within sixty (60) days after written notice thereof by Wink.
Manufacturer shall assume all start-up fees, annual renewal fees, deposit fees
and any and all other fees due to such escrow agent.
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Upon any release of the Wink Engine source code to
Manufacturer, (i) Manufacturer shall have a non-exclusive, non-transferable
license to use such source code solely to support and maintain the Combined
Product until the expiration or termination of Manufacturer's rights subject to
section 9.4.1 and only during the time that the release condition exists, (ii)
such source code shall be treated by Manufacturer as Confidential Information of
Wink under the provisions of Section 10 hereof. As soon as the release condition
ceases to exist, Manufacturer shall immediately return the source code and all
modifications thereto made by Manufacturer, as well as the current source code
version provided by Wink, to the escrow agent for re-deposit and Manufacturer
shall delete any and all copies of the source code from Manufacturer computers
or electronic storage media and destroy all paper copies of source code.
Manufacturer will use the source code at its facilities,
to be designated by Manufacturer and communicated in writing to Wink and the
escrow agent prior to release of the source code. The source code will be
installed on a computer system at the designated location which is (a)
accessible only to Manufacturer employees who need access in order to effect the
purposes of this Agreement and (b) not accessible through a modem, network, or
other means of external communications. Manufacturer agrees to keep a written
record of all persons authorized to access the source code and will store the
source code in a locked facility with limited access when not in use. In
addition, Manufacturer agrees to inform all employees who are given access to
the source code that such source code is the confidential material of Wink
licensed to Manufacturer as such. Access to the source code will be limited to
those Manufacturer employees needing such access to effect the purposes of this
Agreement. Manufacturer will be fully responsible for the conduct of its
employees, agents, and representatives who in any way breach this Agreement.
Manufacturer will enter into a confidentiality agreement with each Manufacturer
employee who is given access to the source code, which agreement will
incorporate the protections and restrictions set forth herein. Manufacturer will
notify Wink promptly in the event of any breach of its security where it appears
that any source code was misappropriated, disclosed in violation of this
Agreement or exposed to loss, and Manufacturer will take all actions required to
recover the source code in the event of loss or misappropriation or to otherwise
prevent its unauthorized disclosure or use. At any time upon request by Wink,
Manufacturer will provide Wink with the names of all persons who have access to
the source code.
9.4.4 The provisions of Sections 5, 6, 9, 10, 11, 12,
and 13 shall survive the expiration or termination of this Agreement for any
reason.
9.5 Sell-off Period. In the event of the expiration of this
Agreement or a termination by Manufacturer, Manufacturer and its Subdistributors
may dispose of its inventory of Combined Products on hand, for a reasonably
commercial period not to exceed one hundred eighty (180) days after the
effective date of such expiration or termination (the "Sell-Off Period"), and in
connection therewith, Manufacturer shall use the Wink Trademarks during the
Sell-Off Period pursuant to the provisions of Section 7.
9.6 Destruction of Inventory. Within thirty (30) days after
the end of the Sell-Off Period, Manufacturer shall destroy, and shall certify to
Wink the destruction of, all copies of the
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Licensed Engine in its or its Subdistributors' possession if Manufacturer has
issued any copies of the Licensed Engine to any of its Subdistributors.
10. CONFIDENTIALITY
10.1 Obligation of Confidentiality. The parties acknowledge
that each may have access to certain information and materials concerning the
other's business, plans, customers, technology and products that is confidential
("Confidential Information"). Each party agrees that it shall not use in any
way, for its own account or the account of any third party, nor disclose to any
third party, except as may be expressly permitted under this Agreement, any such
Confidential Information revealed to it by the other party and shall take every
reasonable precaution to protect the confidentiality of such information. Upon
request by either party, the other party shall advise whether or not it
considers any particular information or materials to be confidential.
10.2 Exceptions. Information shall be deemed not to be
Confidential Information hereunder if such information:
10.2.1 Is or becomes part of the public domain through
no fault or breach on the part of the receiving party;
10.2.2 Is known to the receiving party prior to the
disclosure by the disclosing party and such knowledge can be shown by written
records;
10.2.3 Is subsequently rightfully obtained by the
receiving party from a third party who has the legal right to disclose it
10.2.4 Is independently developed by the receiving party
without the use of any Confidential Information or any breach of this Agreement;
10.2.5 Is approved for public release by the disclosing
party; or
10.2.6 Is required to be disclosed by judicial action
provided that the receiving party has first given the disclosing party
reasonable notice of such requirement and fully cooperates with the disclosing
party in seeking confidential treatment for any such disclosure.
10.3 Injunctive Relief. The parties acknowledge that any
breach of the provisions of this Section may cause irreparable harm and
significant injury to an extent that may be extremely difficult to ascertain.
Accordingly, each party agrees that each will have, in addition to any other
rights or remedies available to it at law or in equity, the right to seek
injunctive relief to enjoin any breach or violation of this Section.
11. INTELLECTUAL PROPERTY, WARRANTY AND INDEMNITY
11.1 Representations and Warranties. Each party represents and
warrants that neither the execution or performance by such party of this
Agreement will violate any law, order, regulation or ruling applicable to such
party or its efforts hereunder. In addition, Wink represents
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and warrants that as of the Effective Date, no action or proceeding alleging
intellectual property infringement by the Wink Engine is proceeding against
Wink, except the "Xxxxxx" claim.
11.2 Indemnity. Wink agrees, at its expense, to defend, or at
its option to settle, any claim, suit, action or proceeding brought against
Manufacturer, Subdistributors, and/or customers by a third party alleging that
the use of the Licensed Engine or the exercise of any of the rights and licenses
granted hereunder infringes the copyright, trade secret, trademark or U.S.
patent rights (collectively "intellectual property rights") of such third party
(an "Action"), and to pay any settlement or final judgment entered thereon
against Manufacturer, subject to the limitations set forth hereafter. Wink shall
be relieved of its obligations hereunder unless Manufacturer gives Wink (i)
prompt written notice of an Action, (ii) sole control over the defense or
settlement of the Action and (iii) reasonable assistance in the defense or
settlement thereof. If it is, or in the opinion of Wink may be, determined by
competent authority that the Licensed Engine or any part thereof, or the sale,
distribution or use thereof as permitted hereunder infringes any patent,
copyright, trade secret or trademark of a third party or is enjoined, then Wink
at its sole option and expense shall: (a) procure for Manufacturer the right
under such patent, copyright, trade secret or trademark to use, as mentioned in
this Agreement, reproduce and distribute the Licensed Engine or such part
thereof or such trademark as authorized in this Agreement; (b) replace the
Licensed Engine or such part thereof or such trademark with other suitable
software or trademark without material degradation in performance or
functionality; (c) modify the Licensed Engine or such part thereof or such
trademark to avoid infringement without material degradation in performance or
functionality; (d) if (a)(b) or (c) are not commercially reasonable, replace or
modify the Licensed Engine or portion thereof to disable the infringing portion
reducing performance or functionality but retaining some commercial viability of
the product; or (e) if none of the foregoing are commercially reasonable after
diligent attempts by Wink to pursue such alternatives, terminate this Agreement
with respect to the infringing product in whole or in part.
11.3 Limitations. The foregoing indemnity shall not apply to
an Action to the extent it arises out of: (i) any modification of the Licensed
Engine by a party other than Wink or authorized by Wink, (ii) Interactive Wink
Programs not supplied by Wink or (ii)any trademarks, trade names or other
branding not supplied by Wink.
11.4 Disclaimer. THE FOREGOING PROVISIONS OF THIS SECTION 11
STATE THE ENTIRE LIABILITY AND OBLIGATION OF WINK AND THE EXCLUSIVE REMEDY OF
MANUFACTURER WITH RESPECT TO ANY ALLEGED INFRINGEMENT OF ANY PATENT, COPYRIGHT,
TRADE SECRET, TRADEMARK OR OTHER INTELLECTUAL PROPERTY RIGHT.
12. INDEMNITY BY MANUFACTURER
Except with respect to any claim, suit, action or proceeding
for which Wink is obligated to indemnify under Section 11, Manufacturer agrees,
at its expense, to defend, or at its option to settle, any such claim, suit,
action or proceeding brought against Wink, and to pay any settlement or final
judgment entered thereon against Wink, if such claim, suit or action is brought
by
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a third party for the infringement of the third party's intellectual property
rights by the Manufacturer's use of the licensed engine or by the Manufacturer's
exercise of the rights and licenses granted. This indemnity obligation shall not
exist if the alleged infringement is necessary to utilize any aspect of the
functionality of the Licensed Engine or if the alleged infringement is necessary
to exercise any of the rights and licenses granted hereunder. Further, the
Manufacturer shall be relieved of its obligations hereunder unless Wink gives
Manufacturer (i) prompt written notice upon becoming aware of the existence of
any such claim, suit, action or proceeding, (ii) sole control over the defense
or settlement of such claim, suit, action or proceeding and (iii) reasonable
assistance in the defense or settlement thereof.
13. GENERAL
13.1 Governing Law and Jurisdiction. This Agreement shall be
governed by and construed under the laws of the State of California, without
reference to conflict of laws principles.
13.2 Import & Export Controls. Manufacturer understands that
Wink is subject to regulation by agencies of the U.S. government which prohibit
export or diversion of certain products and technology to certain countries. Any
and all obligations of Wink including without limitation obligations to provide
products, technology, documentation, or technical assistance, will be subject in
all respects to such United States laws and regulations that will from time to
time govern the license and delivery of technology and products abroad or to
foreign nationals by persons subject to the jurisdiction of the United States.
Manufacturer warrants that it will comply in all respects with all applicable
export and re-export restrictions. Manufacturer warrants that it will not, and
will take all actions which may be reasonably necessary to assure that its
Subdistributors and end users do not, contravene such United States laws or
regulations.
13.3 No Assignment. This Agreement shall not be assigned by
either party without the prior written consent of the other party, which consent
shall not be unreasonably withheld, except that either party may assign its
rights and obligations hereunder to any entity (i) which controls, is controlled
by or is under common control with such party or (ii) which acquires all or
substantially all of the assets or business of such party to which this
Agreement pertains, provided in both cases that such entity shall assume in
writing or by operation of law such party's obligations under this Agreement.
Subject to the foregoing, this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their successors and assigns.
13.4 Independent Contractors. The relationship of the parties
established by this Agreement is that of independent contractors, and nothing
contained in this Agreement shall be construed to (i) give either party the
power to direct and control the day-to-day activities of the other, (ii)
constitute the parties as partners, joint venturers, co-owners or otherwise as
participants in a joint or common undertaking, or (iii) allow either party to
create or assume any obligation on behalf of the other party for any purpose
whatsoever.
13.5 Compliance with Laws. In exercising its rights under this
license, each party shall fully comply with the requirements of any and all
applicable laws, regulations, rules and orders of any governmental body having
jurisdiction over the exercise of rights under this license.
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13.6 Notices. All notices under this Agreement shall be in
writing and sent by (i) certified air mail, return receipt requested, postage
prepaid or (ii) commercial courier service. If properly addressed to or
delivered at the address for each party set forth above, a notice shall be
deemed given upon delivery or, where delivery cannot be effected due to the
actions of the addressee, upon tender.
13.7 Entire Agreement. This Agreement represents the entire
agreement of the parties with respect to the subject matter hereof and
supersedes all prior or contemporaneous agreements, understandings, proposals
and representations by the parties.
13.8 No Waiver. Failure by either party to enforce any
provision of this Agreement will not be deemed a waiver of future enforcement of
that or any other provision.
13.9 No Oral Modification. No alteration, amendment, waiver,
cancellation or any other change in any term or condition of this Agreement
shall be valid or binding on either party unless mutually agreed in writing.
13.10 Language. This Agreement is in the English language
only, which language shall be controlling in all respects, and all versions
hereof in any other language shall not be binding on the parties. All
communications and notices to be made or given pursuant to this Agreement shall
be in the English language.
13.11 Use of "Including". Use of the word "including" in this
Agreement is intended to be illustrative and not limiting.
13.12 Limitation of Liability. [EXCEPT WITH RESPECT TO WINK'S
OBLIGATIONS TO INDEMNIFY FOR COPYRIGHT, TRADE SECRET, TRADE XXXX OR PATENT
INFRINGEMENT CLAIMS UNDER SECTION 11, IN NO EVENT SHALL WINK BE LIABLE TO
MANUFACTURER OR ANY THIRD PARTY IN THE AGGREGATE FOR ANY AMOUNT IN EXCESS OF THE
AMOUNTS PAID (AND THE AMOUNTS WHICH HAVE ACCRUED HEREUNDER BUT HAVE NOT BEEN
PAID) BY MANUFACTURER HEREUNDER. IN NO EVENT SHALL WINK BE LIABLE TO
MANUFACTURER, SUBDISTRIBUTORS, AND/OR CUSTOMERS FOR LOST PROFITS, LOSS OF DATA
OR FOR ANY SPECIAL, INCIDENTAL, CONSEQUENTIAL OR INDIRECT DAMAGES ARISING IN ANY
WAY OUT OF THIS AGREEMENT, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY. THIS
LIMITATION SHALL APPLY EVEN IF WINK KNOWS OR HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES AND NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY
LIMITED REMEDY PROVIDED FOR HEREIN]
13.13 Counterparts. This Agreement may be executed in any
number of counterparts and when so executed and delivered shall have the same
force and effect as though all signatures appeared on one document.
13.14 Severability. The provisions of this Agreement shall be
severable, and if any provision of this Agreement shall be held or declared to
be illegal, invalid, or unenforceable, such
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17
illegal, invalid or unenforceable provision shall be severed from this Agreement
and the remainder of the Agreement shall remain in full force and effect, and
the parties shall negotiate a substitute, legal, valid and enforceable provision
that most nearly reflects the parties' intent in entering into this Agreement.
IN WITNESS WHEREOF, the parties by their duly authorized
representatives have entered into this Agreement as of the Effective Date.
WINK COMMUNICATIONS, INC. MANUFACTURER
By: By:
---------------------------- ---------------------------------
Name: Name:
---------------------------- ---------------------------------
Title: Title:
---------------------------- ---------------------------------
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EXHIBIT A-1
[SAMPLE] STATEMENT OF WORK
1. Device
Wink and Manufacturer agree that Wink shall port the Wink Engine to the DIRECTV
System Receiver.
2. Specifications
See attached Addendum to Exhibit A-1
3. Development Activities and Schedule
RESPONSIBLE COMPLETION MILESTONE
TASK PARTY DATE PAYMENT
Signing of Agreement Manufacturer no
Delivery of development equipment as Manufacturer no
required to a location specified
by Wink
Delivery by Wink of Project Plan for Wink no
development of Engine Version 2.0 as
customized for Manufacturer __________
First Delivery of Equipment to Wink Manufacturer no
On-site support at Wink to set Manufacturer no
up Equipment
Delivery by Wink of Alpha version of Wink no
object code of Wink Engine Version 2.0
as customized for __________
Final Delivery of Equipment to Wink Manufacturer no
Delivery by Wink of Beta version of Wink no
object code of Wink Engine Version
2.0 as customized for ____________
Acceptance of final version of object DIRECTV no
code of Wink Version 2.0 as
customized for __________
A-1
19
4. Materials and Equipment
First Delivery of Equipment
To be defined
Final Delivery of Equipment
To be defined
5. Payment Schedule: All amounts in US Dollars.
NRE PAYMENT ROYALTY PAYMENT
EVENT
Signing of Agreement [ $0 ] [ $0 ]
Delivery by Wink of Project Plan for development of Wink Engine Version [ $0 ] [ $0 ]
2.0 as customized for Manufacturer ____________
Delivery by Wink of Alpha version of object code of Wink Engine Version [ $0 ] [ $0 ]
2.0 as customized for Manufacturer ____________
Acceptance of final version of object code of Wink Engine Version 2.0 [ TBD ] [ $0 ]
as customized for Manufacturer ____________
Totals: [ TBD ] [ $0 ]
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20
EXHIBIT B
PROPRIETARY NOTICES
1. Screens displayed to the End-Users from time to time shall contain, at a
minimum, the following:
Copyright 199___ Wink Communications, Inc.
Patent Pending.
2. Wink, the Wink eye and "i" shall be marked with either "Registered in U.S.
Patent and Trademark Office" or with the letter R enclosed within a
circle.
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21
EXHIBIT C - SUPPORT
The following provisions govern the support to be provided by Wink to
Manufacturer for the Licensed Engine.
1. Contact People. Manufacturer shall appoint two (2) individuals
within its organization who will serve as primary contacts between it and Wink
to receive support ("Contact People"). All of Manufacturer's support inquiries
shall be initiated through the Contact People.
2. Support Obligations. Manufacturer will be responsible for providing
First Level Support and Second Level Support (as defined below) to its
Subdistributors and other customers with respect to the Licensed Engine. Wink
will provide Third Level Support (as defined below) for the Licensed Engine in
the manner specified in these support terms.
3. Support Levels. Levels of customer support are defined as follows:
(a) "First Level Support" shall mean: (i) generating product
information; (ii) providing configuration support; (iii) collection of relevant
technical problem identification information; (iv) filtering user errors from
real technical problems; and (v) solving simple problems by reference to
existing documentation.
(b) "Second Level Support" shall mean First Level Support plus
providing the following areas of support: (i) isolating the problem to determine
that it is a problem with the Licensed Engine; (ii) recreating the problem in a
lab simulation and/or through interoperability testing; (iii) determining
whether or not the problem is a defect; (iv) collecting and analyzing diagnostic
data; and (v) defining an action plan with the customer to solve the problem.
(c) "Third Level Support" shall mean: (i) confirming
duplication of the problem and validating that it's a defect; (ii) fixing
software bugs or generating workarounds.
4. Third Level Support.
(a) Escalation. Manufacturer can escalate a problem to Third
Level Support, once Manufacturer exhausts the items enumerated above in First
and Second Level Support. When escalating, Manufacturer shall provide enough
information to allow Wink to duplicate the problem.
(b) Assignment of Severity Level. When a Third Level support
call comes into Wink from Manufacturer, the parties will mutually assign a
Severity Level as specified below that describes the nature of the call and how
critical it is to Manufacturer's customer base(s).
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22
(c) Response: Wink agrees to use commercially reasonable
efforts to meet the response times for the respective problems commensurate with
the severity of the error as specified below:
First Frequency of
Severity Level Definition Response Time Status Update
-------------- --------------------------- ---------------- -----------------
Critical Bug causes a crash and/or 4 business hours Each business day
data loss to a part or all
of the system
High Bug causes a feature to 4 business hours Each business day
violate a performance
specification (i.e.,
feature consistently does
not work as specified, or
not at all)
Medium Bug causes an occasional 1 business day Weekly
failure of a feature (i.e.,
feature fails in specific
cases)
Low Bug is characterized by a 1 business day Weekly
"glitch" that does not
affect a feature's
performance (e.g.,
confusing messages,
typo-graphical errors,
visual abnormalities, etc.)
Doc Error Error in documentation 2 business days
(d) Support. Wink agrees to provide Third Level Support from 9
a.m. to 6 p.m. (San Francisco time) on business days ("Support Hours"). Support
requests shall be submitted by Manufacturer via email.
5. Exclusions. Wink's support obligations shall not extend to problems
that result from: (i) Manufacturer's failure to implement any Updates to the
Licensed Engine which are provided by Wink; (ii) changes to the operating system
or environment or Combined Products which adversely affect the Licensed Engine;
(iii) any alterations of or additions to the Licensed Engine performed by
parties other than Wink or Wink's authorized Subcontractors; (iv) use of the
Licensed Engine in a
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23
manner inconsistent with the applicable Specifications or in a manner for which
such Licensed Engine was not intended; or (v) combination of the Licensed Engine
with other products not supplied by Wink, which problems do not affect the
Licensed Engine standing alone. Errors arising from the foregoing may be
addressed by Wink at its then current hourly rates.
6. Change. These support terms are subject to change annually. Any
changes must be documented in writing and signed by both parties at least 90
days prior to the renewal date.
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