EXHIBIT 10.18
TRADEMARK LICENSE AGREEMENT
THIS TRADEMARK LICENSE AGREEMENT (the "Agreement") is entered into by
and among International Business Machines Corporation, a New York corporation
("IBM"), and NetObjects, Inc., a Delaware corporation ("NetObjects").
WHEREAS, IBM deems it to be in its self interest to obtain a license to
use the "NetObjects" trademark to rebrand IBM's "TopPage" software product,
and any subsequent versions, enhancements and derivative works thereof (the
"Product"), as "NetObjects TopPage"; and
WHEREAS, NetObjects deems it to be in its self interest to grant such a
license to IBM in order to enhance the goodwill and recognition of its
"NetObjects" trademark.
NOW, THEREFORE, in consideration of the mutual promises and agreements
set forth below, IBM and NetObjects agree as follows:
NetObjects hereby grants IBM a non-exclusive, sub-licensable, worldwide
license to use the "NetObjects" trademark and associated artwork attached
hereto as Exhibit 1 (the "Trademark") as part of a new "NetObjects TopPage"
trademark (the "New Trademark"), and to use the New Trademark in conjunction
with the Product including, without limitation, to name and to market the
Product using the New Trademark. NetObjects warrants that it has all
requisite rights in the Trademark to make the forgoing license grant to IBM.
IBM may sublicense its rights under this Agreement so long as IBM enters
into a written agreement with each sublicensee that is at least as protective
of NetObjects' intellectual property and other rights as is this Agreement
and provides payment obligations at least equivalent to those set forth in
this Agreement.
In consideration for the forgoing license grant, for each authorized
copy of the Product branded with the New Trademark ("Rebranded Product")
licensed to an end user by IBM on a stand-alone basis (i.e., without any
other software, hardware or services), IBM will pay NetObjects a royalty of
fifty cents ($0.50).
IBM has no royalty obligation for copies of the Rebranded Product used
by IBM, its subsidiaries or their contractors: internally; for development,
maintenance or support activities, marketing demonstrations, customer testing
or trial periods (including early support, prerelease, or other similar
programs); for training or education; or for backup and archival purposes. In
addition, IBM has no royalty obligation: for copies of the Rebranded Product
used by a licensed end user at home or on travel when such Product is stored
on both the user's primary machine as well as another machine, provided that
the end user is not authorized to actively use the Product on both machines
at the same time; for copies of Rebranded Product licensed or distributed by
or through NetObjects; for copies of Rebranded Product not licensed for full
productive use ("Limited Functionality Copies") so long as such Limited
Functionality Copies have limited time of use or limited functionality; for
copies of the Rebranded Product that become available
generally to third parties without a payment obligation; for documentation
provided with, contained in, or derived from the Rebranded Product; for
copies of the Rebranded Product sold in combination with other software or
hardware products, or services; for copies of the Rebranded Product which
contain error corrections or enhancements to earlier versions of Rebranded
Product ("Error Correction Copies") so long as such Error Correction Copies
are made available only to previous purchasers of Rebranded Product; for
copies of the Rebranded Product distributed with for warranty replacement
copies of the Rebranded Product; for transfer of copies of Rebranded Product
to, or possession of such copies by, IBM or its subsidiaries from a customer
under an outsourcing arrangement; for any pictorial, graphic, and audiovisual
works (such as icons, screens, sounds, and characters) generated by execution
of the Rebranded Product; and for any programming interfaces, languages or
protocols implemented in Rebranded Product to enable interaction with other
computer programs. Royalties, if any, shall be paid quarterly, and payment
shall be made by the last day of the second calendar month following each
royalty payment quarter.
IBM and NetObjects acknowledge that they are negotiating a separate
agreement (the "IBM Software License Agreement") whereby, in exchange for a
mutually-agreeable royalty payment to IBM, NetObjects will acquire
non-exclusive rights to distribute Rebranded Product. The Parties agree to
use commercially reasonable efforts to negotiate and execute the IBM Software
License Agreement by March 31, 1999. The Parties propose that relevant
terms of the IBM Software License Agreement may include terms related to or
in accordance with the following: IBM and NetObjects will both have the
rights to distribute the Rebranded Product in different geographic regions;
NetObjects will pay IBM a royalty for licensing the Rebranded Product; and
technical support duties of the Parties. Although each party may exchange
written or oral proposals (including, but not limited to the proposal
included in this paragraph), term sheets, draft agreements or other
materials, neither party will have any obligations or liability to the other
unless and until their authorized representatives sign the IBM Software
License Agreement. Exchanged terms are non-binding to the extent they are
not included in the IBM Software License Agreement. Either company can end
these discussions at any time, for any reason, and without liability to the
other. Each company remains free to negotiate or enter into similar
relationships with others. Each of the parties agree to pay all costs it
incurs in connection with the negotiation of the IBM Software License
Agreement. Neither party is authorized to make any commitments or
statements on behalf of the other. Information disclosed during the course of
negotiations shall be considered confidential under, and shall be disclosed
under the terms of a the Agreement for the Exchange of Confidential
Information between the parties, dated April 30, 1996.
The term of this Agreement will be six (6) months from the date the last
party executes it or until the IBM Software License Agreement is executed,
whichever may occur first, and will be automatically renewable for an
additional one (1) year term unless notice of termination is provided at
least thirty (30) days prior to such renewal date. Upon any termination or
expiration of this Agreement, IBM will be allowed to continue use of the New
Trademark, under the terms of this Agreement, until IBM makes generally
available to the public the next release of the Product.
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Each party shall have the right to terminate this Agreement in the event
of a material breach by the other party of its obligations hereunder. Such
termination shall be made by written notice to the breaching party
specifically identifying the breach on which termination is based and shall
become effective sixty (60) days after giving such notice, unless the
breaching party shall have corrected the breach during the sixty (60) day
period. Correction of the breach described in such notice shall render the
notice void.
In the event of any termination or expiration of this Agreement, all
rights and licenses granted to IBM herein shall terminate except that:
a) the termination shall not affect any rights or licenses exercised or
granted by IBM prior to termination under this Section; , and
b) the rights and licenses granted to IBM in this Agreement (and
associated royalty obligations) will continue to permit IBM to provide error
corrections and enhancements to the Rebranded Product, and to fill orders
received before termination or expiration, and to fill new orders to
distribute existing inventory, and to continue distributing the versions and
releases of the Rebranded Product that had already been announced prior to
any termination or expiration of this Agreement. For example, if this
Agreement terminates or expires (i.e., the term ends) on 4/1/99, and prior to
4/1/99, IBM had already announced the following versions and releases of the
Rebranded Products: 1.1, 1.2, 2.1, 2.2, then IBM may continue to distribute
those same versions and releases of the Rebranded Products and will pay the
applicable royalty to NetObjects, but any future versions and releases of
that same product (e.g., 2.3, 3.0) cannot carry the Trademark under the terms
of this Agreement.
This Agreement represents the entire agreement of the parties hereto with
respect to the subject matter hereof, and may be amended only by a writing
signed by both parties hereto. This Agreement shall be governed by the laws
of the State of New York without regard to conflicts of law principles. Both
parties waive the right to a jury in any resulting litigation. Any
reproduction of this Agreement, by reliable means (e.g., photocopy or
facsimile) shall be deemed an original.
IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
representatives to execute this Agreement on their behalf.
INTERNATIONAL BUSINESS
MACHINES CORPORATION NETOBJECTS, INC.
By: /s/ Xxxxx Xxxx By: /s/ X. Xxxxxxx
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Name: X. Xxxx Name: X. Xxxxxxx
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Its: ESBU Marketing Its: V.P. Finance
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Date: 1/19/99 Date: 1/19/99
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