1
Exhibit 10.10
SETTLEMENT AND LICENSE AGREEMENT
This Settlement and License Agreement ("Agreement"), effective as of the
later date signed below ("Effective Date"), is made by Sun Microsystems, Inc.,
with a place of business at 000 Xxx Xxxxxxx Xxxx, Xxxx Xxxx, Xxxxxxxxxx 00000
and acting by and through its JavaSoft division ("Sun"), and Persistence
Software, Inc. with a place of business at 0000 Xxxxx Xxxxxxxx Xxxx., Xxxxx
000, Xxx Xxxxx, Xxxxxxxxxx 00000 ("Persistence").
RECITALS
A. Persistence is the owner of the Persistence Patents (defined below),
and has informed Sun that its Java Blend(TM) software may require a license
under the Persistence Patents.
B. Sun is the owner of the Sun Patents (defined below), and has informed
Persistence that its products may require a license under the Sun Patents.
C. Sun and Persistence wish to resolve and settle certain disputes that
have arisen with respect to the Persistence Patents and the Sun Patents, and to
avoid future conflict or dispute that might arise with respect to such patents
by entering into a non-exclusive object code license under such patents (as
further defined below).
D. Commencing in 1994, Sun's wholly-owned subsidiary SunSoft, Inc. and
Persistence entered into a series of agreements and engaged in other business
dealings ("SunSoft/Persistence Relationship" as further defined below)
concerning, Inter alia, Persistence's product related to relational database
access then known as Persistence. Persistence has alleged, and Sun has denied,
that Sun may have misappropriated Persistence's trade secrets which it may have
been exposed to as a result of the SunSoft/Persistence Relationship.
E. Sun and Baan have entered into a joint development relationship under
which Baan is entitled to receive access to the JavaBlend source code for use
and incorporation by Baan into its products, and to avoid future conflict or
dispute that might arise with respect to such products Persistence is willing
to enter into a non-exclusive object code license relating to such products (as
further defined below);
F. Sun and Persistence wish to resolve and settle certain disputes that
have arisen with respect to the SunSoft/Persistence Relationship, and to avoid
future conflict or dispute that might arise with respect to it by entering into
a mutual release of claims related thereto (as further defined below).
G. In conjunction with the foregoing, Sun and Persistence wish to engage
in certain cooperative marketing efforts as described below.
THEREFORE, Sun and Persistence agree as follows:
1. DEFINITIONS.
1.1 "JavaBlend Source Code Licensing" shall mean the licensing by Sun of
the source code of its JavaBlend software or any derivative works thereof to
third parties who are authorized by Sun to develop and introduce products of
such third party based upon and incorporating Jav-
[****] Confidential Treatment Requested
Omitted Portions on File with the
Securities Exchange Commission
2
aBlend software. "JavaBlend Source Code Licensing" shall not include the
licensing by Sun of the source code of its JavaBlend(TM) software to Baan
pursuant to Section 2.1 b. or to contractors engaged by Sun or Baan on a "work
for hire" basis pursuant to Section 2.1 a. (iii) or Section 2.1 b. (iii),
respectively.
1.2 "Persistence Patents" means (a) U.S. Patent Numbers 5,499,371 and
5,615,362 and 5,706,506 and (b) any foreign counterparts, reissues,
reexaminations, divisionals, continuations and continuations-in-part of U.S.
Patent Numbers 5,499,371 and 5,615,362 and 5,706,506 claiming or entitled to
priority therefrom, and (c) any of its patents or pending patent applications
which, as of the date of this Agreement, Persistence knows would be infringed
by the making, using, leasing, licensing, selling or other transfer, or
practice of the Sun Technology.
1.3 "Persistence Technology" shall mean software technology, including
but not limited to PowerTier for Enterprise Java Beans, offered for license or
sale by Persistence.
1.4 "Sun Patents" means (a) U.S. Patent Number 5,261,098, (b) any foreign
counterparts, reissues, reexaminations, divisionals, continuations or
continuations-in-part of U.S. Patent Number 5,261,098 claiming and entitled to
priority therefrom, and (c) any of its patents or pending patent applications
which, as of the date of this Agreement, Sun knows would be infringed by the
making, using, leasing, licensing, selling or other transfer, or practice of
the Persistence Technology.
1.5 "Sun Technology" shall mean software technology, including but not
limited to Sun's JavaBlend(TM) software, offered for license or sale by Sun.
1.6 "SunSoft/Persistence Relationship" means matters related to SunSoft's
and Persistence's business relationship commencing in 1994 concerning
Persistence's object-to-relational mapping technology, multi-threading
technology, and caching technology, including but not limited to the parties'
respective obligations under and activities related to the subject matter of
the Technology and Licensing Agreement of December 21, 1994, the Distribution
Agreement of January 31, 1995, including Xxxx Xxxxxxx'x participation (if any)
as a member of Persistence's Technical Advisory Board.
2. LICENSE GRANTS.
2.1 License to Persistence Patents for Sun Technology.
a. Subject to payment of the fee specified in Section 3.1, and except
with respect to JavaBlend Source Code Licensing, Persistence hereby grants to
Sun a perpetual, worldwide, non-exclusive, royalty free and fully paid-up
license under the Persistence Patents: (i) to make and use Sun Technology in
any form and to lease, license, sell or otherwise transfer, whether directly or
indirectly, Sun Technology in object code form only; (ii) to practice any
method or process in the manufacture or use of such Sun Technology; and (iii)
to have made or modified Sun Technology in source code or object code form by a
contractor engaged by Sun on a "work for hire" basis. Persistence further
agrees that, except with respect to JavaBlend Source Code Licensing, it will
not enforce any rights it might have under the Persistence Patents against
Sun's object code licensees or sublicensees with respect to their use, lease,
license, sale or other transfer, or practice of methods or processes for the
manufacture, of such Sun Technology.
b. In addition, and except with respect to JavaBlend Source Code
Licensing, Persistence
[****] Confidential Treatment Requested
Omitted Portions on File with the
Securities Exchange Commission
3
hereby grants to Baan a perpetual, worldwide, non-exclusive, royalty free and
fully paid-up license under the Persistence Patents: (i) to make and use
JavaBlend software in any form and to lease, license, sell or otherwise
transfer, whether directly or indirectly, JavaBlend software in object code form
only; (ii) to practice any method or process in the manufacture or use of such
JavaBlend software; and (iii) to have made or modified JavaBlend software in
source code or object code form by a contractor engaged by Baan on a "work for
hire" basis. Persistence further agrees that, except with respect to JavaBlend
Source Code Licensing, it will not enforce any rights it might have under the
Persistence Patents against Baan's object code licensees or sublicensees with
respect to their use, lease, license, sale or other transfer, or practice of
methods or processes for the manufacture, of such JavaBlend software.
2.2 License to Sun Patents for Persistence Technology. In consideration for
the licenses granted by Persistence under this Section 2 and for the mutual
release agreed to under Section 4, Sun hereby grants to Persistence a perpetual,
worldwide, non-exclusive, royalty free and fully paid-up license under the Sun
Patents: (i) to make and use Persistence Technology in any form and to lease,
license, sell or otherwise transfer, whether directly or indirectly, Persistence
Technology in object code form only; (ii) to practice any method or process in
the manufacture or use of such Persistence Technology; and (iii) to have made or
modified Persistence Technology in source code or object code form by a
contractor engaged by Persistence on a "work for hire" basis. Sun further agrees
that it will not enforce any rights it might have under the Sun Patents against
Persistence's object code licensees or sublicensees with respect to their use,
lease, license, sale or other transfer, or practice of methods or processes for
the manufacture, of such Persistence Technology.
2.3 JavaBlend Source Code Licensing. Nothing in this Agreement shall be
construed as granting a license to Sun from Persistence for Sun to engage in
JavaBlend Source Code Licensing. In addition, nothing in this Agreement shall be
construed as an agreement by Sun to refrain from engaging in JavaBlend Source
Code Licensing, or as an admission by Sun that Sun requires a license from
Persistence in order to be able to engage in JavaBlend Source Code Licensing.
However, and without contravening the two sentences immediately above, Sun
agrees that if it anticipates initiating JavaBlend Source Code Licensing, Sun
shall inform Persistence in writing of Sun's intentions no later than thirty
days prior to the first instance of JavaBlend Source Code Licensing. Upon
receipt of such notice, the parties will promptly and in good faith attempt to
negotiate a mutually acceptable license for JavaBlend Source Code Licensing, it
being understood that neither party is obligated to enter into such a license
and that failure to enter into such will not prevent Sun from engaging in
JavaBlend Source Code Licensing.
3. MARKETING COOPERATION.
3.1 One-Time Payment. Within 10 days following execution of this Agreement,
Sun shall make a one-time payment of $[****] to Persistence. Persistence shall
use these funds to promote its PowerTier for Enterprise JavaBeans product and
the Enterprise JavaBeans(TM) component architecture specification.
3.2 Cooperative Marketing Activities. In addition to the payment specified
in Section 3.1, to support Persistence's promotion of its PowerTier for
Enterprise JavaBeans product and the Enterprise JavaBeans component architecture
specification Sun shall provide Persistence with: (i) a waiver of fees charged
in connection with the 100% Pure Java(TM) certification program; (ii) in-
[****] Confidential Treatment Requested
Omitted Portions on File with the
Securities Exchange Commission
4
clusion of demonstration of product in next version of Java Reel CD; (iii)
reference story inclusion in on-line Solutions Guide; and, if this Agreement is
executed before the commencement of Sun's 1998 JavaOne Conference ("JavaOne
1998"); (iv) free space at JavaOne 1998; and (v) support for press announcements
and activities at JavaOne 1998. In addition, (a) subject to each party's consent
to the wording of the announcement, which consent shall not be unreasonably
withheld, the parties shall jointly announce that they have entered into a joint
marketing and technology licensing agreement, and (b) the parties will promptly
enter into good faith negotiations with the objective of executing and
announcing a Technology License Agreement relating to Sun's source code for the
Java Development Kit (JDK), for which Sun will waive the initial upfront license
fee (but not support fees) that would typically be associated with Sun's lowest
level, non-distribution rights, least expensive JDK source code license.
4. MUTUAL RELEASE.
Notwithstanding anything else in this Agreement to the contrary, and except
for Persistence's reservation of all claims arising directly out of JavaBlend
Source Code Licensing (in the event that the parties are unsuccessful in
achieving a mutually agreeable source code license for JavaBlend Source Code
Licensing pursuant to Section 2.3 hereof), each of the parties, on behalf of
itself and its attorneys, agents, officers, shareholders, directors, employees,
subsidiaries, affiliates, divisions, successors and assigns, hereby fully and
forever releases the other party, its attorneys, agents, officers, shareholders,
directors, employees, subsidiaries, affiliates, divisions, successors and
assigns, and customers, of and from any and all suits, debts, liens, contracts,
agreements, promises, losses, costs and expenses (including without limitation
court costs and reasonable attorneys' fees), claims, demands, actions,
obligations, liabilities and damages of every kind and nature whatsoever, in law
or in equity, whether known or unknown, which either party or any person acting
under it, may now have, or claim at any future time to have, arising from, or
based in whole or in part upon, any act, omission, event, transaction, matter or
thing involved, alleged or referred to, directly or indirectly, related to the
SunSoft/Persistence Relationship, the Sun Patents and the Persistence Patents
("Released Matters").
Notwithstanding anything else in this Agreement to the contrary, and except
for Persistence's reservation of all claims arising directly out of JavaBlend
Source Code Licensing (in the event that the parties are unsuccessful in
achieving a mutually agreeable source code license for JavaBlend Source Code
Licensing pursuant to Section 2.3 hereof), the parties specifically covenant
never to institute or to participate in any suit or action, at law or in equity,
against each other by reason of any claim, demand, action or cause of action
described in this Section 4.
5. CALIFORNIA CIVIL CODE SECTION 1542.
It is expressly understood and agreed by Persistence and Sun that the
mutual releases stated in Section 4 are intended to cover and do cover not only
all known damages and losses but any further damages and losses not now known or
anticipated but which may later develop or be discovered arising out of any of
the Released Matters.
Each of the parties understands and acknowledges that he or it is aware of
California Civil Code 1542 which provides as follows:
A general release does not extend to claims which the creditor does
not know
[****] Confidential Treatment Requested
Omitted Portions on File with the
Securities Exchange Commission
5
or suspect to exist in his favor at the time of executing the release,
which if known by him must have materially affected his settlement with
the debtor.
Each of the parties expressly waives and relinquishes any rights he or it
may have under Civil Code 1542 or any other statute or common law principle with
a similar effect. In connection with such waiver and relinquishment, Persistence
and Sun acknowledge that they or their attorneys or agents may hereafter
discover claims or facts in addition to or different from those which they now
know or believe to exist with respect to the Released Matters, but that it is
their intention hereby fully, finally and forever to settle and release all of
the Released Matters. In furtherance of this intention, the releases herein
given shall be and remain in effect as full and complete mutual releases
notwithstanding the discovery or existence of any such additional or different
claim or fact.
6. REPRESENTATION BY COUNSEL.
Persistence and Sun acknowledge that they have been represented by counsel
of their choice and this Agreement has been executed with the consent and on the
advice of such legal counsel. Each of them further acknowledges that they and
their counsel have had an adequate opportunity to make whatever investigation or
inquiry they deemed necessary or desirable in connection with the subject matter
of this Agreement prior to the execution thereof.
7. SUCCESSOR AND ASSIGNS.
This Agreement may not be assigned by either party without the prior
written consent of the other party except that either party may assign this
Agreement in the event of a merger or acquisition of all or substantially all of
the assets of the assigning party. In such event, the provisions of this
Agreement and the releases contained herein shall extend to and inure to the
benefit of and be binding upon such assignees, in addition to Persistence and
Sun.
8. ENTIRE AGREEMENT: MODIFICATION.
This Agreement constitutes the entire agreement between the parties
concerning its subject matter and supersedes all prior negotiations and
agreements, whether written or oral, relating to such subject matter. Nothing in
this Agreement shall affect the right of either party to license technology or
otherwise engage in business activities provided that they do not do so in
violation of their obligations hereunder. This Agreement may not be altered,
amended, modified, or otherwise changed except in writing duly executed by the
parties' authorized representatives.
9. PUBLIC COMMENTS.
Each party agrees that it will use all reasonable efforts to confine the
substance of any public comment, oral or written, that it makes regarding the
disputes settled herein to the fact that a mutually acceptable settlement has
been reached, without further characterization of either party's position
regarding the disputes themselves.
10. COUNTERPARTS.
This Settlement Agreement may be executed in counterparts.
[****] Confidential Treatment Requested
Omitted Portions on File with the
Securities Exchange Commission
6
11. GOVERNING LAW.
This Agreement will be governed by the laws of the State of California,
notwithstanding the application of choice of law rules of any jurisdiction to
the contrary.
12. INDEMNIFICATION.
Persistence and Sun each represent and warrant that they have not assigned
or otherwise transferred any right, title or interest in any claim they might
have against each other. Further, Persistence and Sun agree to indemnify and
hold each other forever harmless for any claims, liabilities, demands, damages,
costs and expenses, including attorneys' fees, incurred as a result of any
person or entity asserting any such claim pursuant to any such assignment or
transfer. This indemnity does not require payment as a condition precedent to
recovery under same.
13. SEVERABILITY.
If any provision of this Agreement or the application of any provision of
this Agreement is held by any tribunal of competent jurisdiction to be contrary
to law, the remaining provisions of this Agreement shall remain in full force
and effect and this Agreement shall be interpreted as if such invalid
provision(s) were omitted.
14. HEADINGS.
The paragraph headings contained in this Agreement are provided for
convenience only and shall not be considered in the interpretation and
construction of this Agreement.
15. WAIVER.
The failure of either party at any time to demand strict performance of
this Agreement shall not be deemed a waiver thereof, and each party may at any
time demand strict and complete performance of this Agreement.
16. 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. Such notice will be effective upon
receipt.
[****] Confidential Treatment Requested
Omitted Portions on File with the
Securities Exchange Commission
7
Sun: Persistence:
Sun Microsystems, Inc. Persistence Software, Inc.
000 Xxx Xxxxxxx Xxxx 0000 Xxxxx Xxxxxxxx Xxxx., Xxxxx 000
Xxxx Xxxx, Xxxxxxxxxx 00000 Xxx Xxxxx, Xxxxxxxxxx 00000
Attn: JavaSoft Legal Department Attn.:
MS: UCUP01-305 ---------------------------------
WHEREFORE, the parties hereby execute this Agreement by and through their
duly authorized representatives, whose signatures appear below.
Sun Microsystems, Inc. Persistence Software, Inc.
By: /s/ Xxxx Xxxxxx By: /s/ Xxxxx Xxxxx
-------------------------- -----------------------------
Name: Xxxx Xxxxxx Name: Xxxxx Xxxxx
------------------------ ---------------------------
(Print or Type) (Print or Type)
Title: President, JavaSoft Title: President
----------------------- -------------------------
Date: 3/23/98 Date: 3/23/98
------------------------ ---------------------------
[****] Confidential Treatment Requested
Omitted Portions on File with the
Securities Exchange Commission
