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EXHIBIT 10.13
NETSHOW LICENSE AGREEMENT
This NetShow License Agreement (the "Agreement") is entered into and effective
as of August 5, 1997 (the "Effective Date") by and between MICROSOFT
CORPORATION, a Washington corporation located at Xxx Xxxxxxxxx Xxx, Xxxxxxx, XX
00000 ("Microsoft") and AUDIONET, INC., a Delaware corporation located at 0000
Xxxxxx Xxxxxx, Xxxxxx, XX 00000 ("AudioNet").
RECITALS
Microsoft is the owner and/or authorized licensor of a line of Internet
streaming audio and video client and server technology known as NetShow.
Under this Agreement, Microsoft wishes to grant, and AudioNet wishes to
receive, a license to NetShow and other software and technology licensable from
Microsoft.
The parties hereby agree as follows:
AGREEMENT
1. DEFINITIONS
1.1 "AudioNet Services Support" means [*]
1.2 "AudioNet Services" means [*]
1.3 "Beta Quality" means software which passes system testing, contains
substantially all of the intended core features, is ready for
production testing and contains a limited number of significant
errors.
1.4 "Confidential Information" means: (i) any source code of Microsoft
Software; and (ii) the terms and conditions of this Agreement.
"Confidential Information" shall not include information that: (a) is
or becomes generally known or available by publication, commercial use
or otherwise through no fault of the receiving party; (b) is known and
has been reduced to tangible form by the receiving party at the time
of disclosure and is not subject to restriction; (c) is independently
developed or learned by the receiving party; (d) is lawfully obtained
from a third party that has, to the knowledge of the receiving party,
the right to make such disclosure; or (e) is made generally available
by the disclosing party without restriction on disclosure.
1.5 "Microsoft Software" means NetShow, [*]
1.6 "NetShow" means [*]
1.7 [*]
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1.8 "Production Quality" means software which has either no significant
errors or only significant errors which are documented and mutually
agreed to be rare or remote in likelihood of occurrence, and which has
passed mutual, reasonable acceptance criteria during beta testing in a
production environment.
1.9 "Term" means a period of five (5) years commencing upon the Effective
Date.
1.10 "Third Party Contractor" means a third party company or other entity
under written agreement with AudioNet to perform AudioNet Services
Support, where such written agreement is consistent with the terms and
conditions of this Agreement including, but not limited to, Sections 3
and 6.
1.11 "Updates" means, as to any Microsoft Software, all subsequent public
releases (including maintenance releases) thereof by Microsoft during
the Term, including public releases of error corrections, upgrades,
enhancements, additions, improvements, extensions, modifications and
successor versions, for which Microsoft has the right to license to
AudioNet.
1.12 [*]
2. DELIVERY
2.1 NetShow. Microsoft shall deliver to AudioNet, on such media as AudioNet
reasonably requests, a copy of [*] within five (5) days after the
Effective Date. Updates of NetShow which are separate release versions
shall be delivered to AudioNet as follows:
BETA QUALITY [*]
---------------------------------------------------------------
PRODUCTION QUALITY [*]
2.2 [*]
2.3 [*]
3. OBJECT CODE LICENSE GRANTS
3.1 License Grant - NetShow [*]. Microsoft hereby grants to
AudioNet a [*]
license to use [*]
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[*]
3.2 License Grant - [*]. Microsoft hereby grants to AudioNet a
[*]
3.3 Ownership. Except as expressly licensed to AudioNet in Sections 3.1
and 3.2, Microsoft retains all right, title and interest in and to the
Microsoft Software.
3.4 No Distribution/Other Rights. AudioNet agrees that this Agreement does
not grant to it any distribution or resale rights to the Microsoft
Software, in any form (except solely with respect to the rent and/or
reuse of connections or streams or the sublicense rights to Third
Party Contractors, as provided in Sections 3.1 and 3.2, respectively).
Except as expressly granted in this Agreement, AudioNet shall have no
other rights in the Microsoft Software. Under no circumstances will
the license grant set forth in Sections 3.1 and 3.2 be construed as
granting, by implication, estoppel or otherwise, a license to any
Microsoft technology other than the Microsoft Software.
4. NONEXCLUSIVE
Nothing in this Agreement will be construed as restricting Microsoft's ability
to license, develop, sublicense, manufacture, deploy or distribute Microsoft
Software or any other technology, for itself or for or to any third party.
5. CONSIDERATION
As partial consideration for the licenses under this Agreement, AudioNet shall,
[*], pay Microsoft the license fee set forth in Exhibit B.
6. CONFIDENTIALITY
6.1 The confidentiality provisions of this Agreement shall only apply to
disclosures regarding the terms, conditions and existence of this
Agreement. All other disclosures of Confidential Information shall be
pursuant a separate, confidentiality agreement between the parties
executed as of the Effective Date. Each party shall protect the
other's Confidential Information from unauthorized dissemination and
use with the same degree of care that such party uses to protect its
own like information. Neither party will use the other's Confidential
Information for purposes other than those necessary to directly
further the purposes of this Agreement. Each party will use its best
efforts not to disclose to third parties the other's Confidential
Information without the prior written consent of the other party.
Except as expressly provided in this Agreement, no ownership or
license rights is granted in any Confidential Information.
6.2 The parties' obligations of confidentiality under this Agreement shall
not be construed to limit either party's right to independently
develop or acquire products without use of the other party's
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Confidential Information. Further, either party shall be free to use
for any purpose the residuals resulting from access to or work with
such Confidential Information, provided that such party shall maintain
the confidentiality of the Confidential Information as provided
herein. The term "residuals" means information in non-tangible form,
which may be retained by persons who have had rightful and good faith
access to the Confidential Information, including ideas, concepts,
know-how or techniques contained therein. Neither party shall have any
obligation to limit or restrict the assignment of such persons or to
pay royalties for any work resulting from the use of residuals.
However, the foregoing shall not be deemed to grant to either party a
license under the other party's copyrights or patents.
6.3 Microsoft hereby consents to the following limited disclosures of
Microsoft Confidential Information: (i) AudioNet may disclose the
existence of this Agreement; (ii) AudioNet may disclose the terms of
this Agreement to third party customers, suppliers and current and
prospective investors solely as provided in Exhibit C; and (iii)
AudioNet may disclose this Agreement as required by applicable law,
rule or regulation, including without limitation the Securities Act of
1933, as amended, the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and the rules and regulations promulgated by the
Securities and Exchange Commission (the "SEC") thereunder; provided
that, AudioNet shall (a) give written notice to Microsoft prior to
such disclosure and shall comply with any protective order or
equivalent that Microsoft obtains and (b) cooperate with Microsoft in
structuring a SEC Rule 406 request for confidential treatment with
respect to as many of the terms of this Agreement as may reasonably be
achieved.
7. WARRANTIES
7.1 Microsoft warrants and represents that the Microsoft Software, to the
best of its knowledge, does not infringe any third party copyright,
patent or trade secret.
7.2 AudioNet warrants and represents that the AudioNet Services, to the
best of its knowledge, shall not infringe any third party copyright,
patent or trade secret.
8. DISCLAIMER OF FURTHER WARRANTIES
EXCEPT AS EXPRESSLY WARRANTED IN SECTION 7.1, THE MICROSOFT SOFTWARE IS
PROVIDED TO AUDIONET "AS IS" WITHOUT FURTHER WARRANTY OF ANY KIND. MICROSOFT
DISCLAIMS ALL FURTHER WARRANTIES, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT
LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, TITLE AND NONINFRINGEMENT.
EXCEPT AS EXPRESSLY WARRANTED IN SECTION 7.2, THE AUDIONET SERVICES ARE
PROVIDED "AS IS" WITHOUT FURTHER WARRANTY OF ANY KIND. AUDIONET DISCLAIMS ALL
FURTHER WARRANTIES, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO,
THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
TITLE AND NONINFRINGEMENT.
9. INDEMNITY
9.1 By Microsoft.
(a) Microsoft shall, at its expense and AudioNet's request, defend
any claim or action brought against AudioNet, or any of
AudioNet's subsidiaries, affiliates, directors, officers,
employees,
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agents and independent contractors, to the extent such claim
or action is based upon a claim (i) that the Microsoft
Software infringes or violates any patent, copyright,
trademark, trade secret or other proprietary right of a third
party or (ii) that Microsoft does not have the rights to grant
AudioNet the rights granted in Section 3 ("Microsoft Claims"),
and Microsoft will indemnify and hold AudioNet harmless from
and against any costs, damages and fees reasonably incurred by
AudioNet, including but not limited to fees of attorneys and
other professionals, as a result of such Microsoft Claims.
AudioNet shall: (i) provide Microsoft reasonably prompt notice
in writing of any such Microsoft Claims and permit Microsoft,
through counsel mutually acceptable to AudioNet and Microsoft,
to answer and defend such Microsoft Claims; and (ii) provide
Microsoft information, assistance and authority, at
Microsoft's expense, to help Microsoft to defend such
Microsoft Claims. Microsoft will be responsible for any
settlement made by AudioNet only if Microsoft's written
permission has been obtained, which permission will not be
unreasonably withheld.
(b) Microsoft may not settle any Microsoft Claim under this
Section 9.1 on AudioNet's behalf without first obtaining
AudioNet's written permission, which permission will not be
unreasonably withheld. In the event AudioNet and Microsoft
agree to settle a Microsoft Claim, Microsoft agrees not to
publicize the settlement without first obtaining AudioNet's
written permission, which permission will not be unreasonably
withheld.
(c) The obligations of this Section 9.1 shall be AudioNet's
exclusive remedy for any breach of Microsoft's warranties
under Section 7.
(d) Notwithstanding anything to the contrary in this Section 9.1,
Microsoft shall have no obligation to indemnify and hold
AudioNet harmless with respect to any breach of contract claim
made against AudioNet under a contract between AudioNet and
any third party.
9.2 By AudioNet.
(a) AudioNet shall, at its expense and Microsoft's request, defend
any claim or action brought against Microsoft, or any of
Microsoft's subsidiaries, affiliates, directors, officers,
employees, agents and independent contractors, to the extent
such claim or action is based upon a claim that the AudioNet
Services infringe or violate any patent, copyright, trademark,
trade secret or other proprietary right of a third party,
except to the extent such claim or action arises solely from
AudioNet's use of the Microsoft Software ("AudioNet Claims"),
and AudioNet will indemnify and hold Microsoft harmless from
and against any costs, damages and fees reasonably incurred by
Microsoft, including but not limited to fees of attorneys and
other professionals, as a result of such AudioNet Claims.
Microsoft shall (i) provide AudioNet reasonably prompt notice
in writing of any such AudioNet Claims and permit AudioNet,
through counsel mutually acceptable to Microsoft and AudioNet,
to answer and defend such AudioNet Claims; and (ii) provide
AudioNet information, assistance and authority, at AudioNet's
expense, to help AudioNet to defend such AudioNet Claims.
AudioNet will be responsible for any settlement made by
Microsoft only if AudioNet's written permission has been
obtained, which permission will not be unreasonably withheld.
(b) AudioNet may not settle any AudioNet Claim under this Section
9.2 on Microsoft's behalf without first obtaining Microsoft's
written permission, which permission will not be unreasonably
withheld. In the event Microsoft and AudioNet agree to settle
an AudioNet Claim, AudioNet agrees not to publicize the
settlement without first obtaining Microsoft's written
permission, which permission will not be unreasonably
withheld.
(c) The obligations of this Section 9.2 shall be Microsoft's
exclusive remedy for any breach of AudioNet's warranties under
Section 7.2.
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10. TERMINATION
10.1 Term. Unless earlier terminated in accordance with Section 10.2, this
Agreement shall commence upon the Effective Date and continue in full
force and effect through the Term.
10.2 Termination By Either Party For Cause. Either party may suspend
performance and/or terminate this Agreement immediately upon written
notice at any time if:
(a) The other party is in material breach of any material
warranty, term, condition or covenant of this Agreement, other
than those contained in Section 6, and fails to cure that
breach within sixty (60) days after written notice thereof; or
(b) The other party is in material breach of Section 6 and fails
to cure that breach within five (5) business days after
written notice thereof.
10.3 Effect of Termination.
(a) Neither party shall be liable to the other for damages of any
sort resulting solely from terminating this Agreement in
accordance with its terms.
(b) Should the Term of this Agreement expire or should this
Agreement be terminated by AudioNet for Microsoft's material
breach AudioNet's license grant under Section 3 shall survive
in perpetuity but only with respect to the then current
version of Microsoft Software in AudioNet's possession as of
the effective date of termination.
(c) Should this Agreement be terminated due to AudioNet's material
breach (other than a material breach of Sections 3 and 6),
AudioNet's license grants under Section 3 shall survive in
perpetuity, but only with respect to the versions of the
Microsoft Software in AudioNet's possession as of the
effective date of termination.
(d) Should this Agreement be terminated due to AudioNet's material
breach of Sections 3 or 6), AudioNet's license grants under
Section 3 shall not survive termination. Nothing in this
Section 11.3 shall limit Microsoft's ability to enforce its
rights and AudioNet's obligations under Sections 3 or 6 by
equitable relief such as injunction or specific performance.
10.4 Survival. In the event of termination or expiration of this Agreement
for any reason, Sections 4, 6, 8, 9, 11 and 12 shall survive
termination.
11. LIMITATION OF LIABILITIES
IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY CONSEQUENTIAL, INDIRECT,
INCIDENTAL, PUNITIVE OR SPECIAL DAMAGES WHATSOEVER, INCLUDING WITHOUT
LIMITATION, DAMAGES FOR LOSS OF BUSINESS PROFITS, BUSINESS INTERRUPTION, LOSS
OF BUSINESS INFORMATION, AND THE LIKE, ARISING OUT OF THIS AGREEMENT OR THE USE
OF OR INABILITY TO USE THE MICROSOFT SOFTWARE OR EITHER PARTY'S CONFIDENTIAL
INFORMATION, EVEN IF A PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.
THIS SECTION SHALL NOT APPLY TO SECTIONS 6 AND 9.
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12. GENERAL PROVISIONS
12.1 Notices. All notices and requests in connection with this Agreement
shall be deemed given as of the day they are received either by
messenger, delivery service, or in the United States of America mails,
postage prepaid, certified or registered, return receipt requested,
and addressed as follows:
TO AUDIONET: TO MICROSOFT:
AudioNet, Inc. Microsoft Corporation
0000 Xxxxxx Xxxxxx One Microsoft Way
Dallas, TX 75226 Xxxxxxx, XX 00000-0000
Attention: Xxxx X. Xxxxxx, CEO Attention:
Xxxxxxx@xxxxxxxx.xxx
Phone: (000) 000-0000 Phone: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Copy to: Copy to:
Xxxx X. Xxxxxxxxx Microsoft Corporation
Xxxxxx Xxxx & Xxxxxxxx Xxx Xxxxxxxxx Xxx
000 Xxxx Xxxxxx Xxxxxxx, XX 00000-0000
Xxx Xxxx, XX 00000 Attention: Law & Corporate Affairs
xxxxxxxxxx@xxxxxx.xxx
Phone: (000) 000-0000 Phone: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
or to such other address as a party may designate pursuant to this
notice provision.
12.2 Independent Parties. Nothing in this Agreement shall be construed as
creating an employer-employee relationship, a partnership, or a joint
venture between the parties.
12.3 Governing Law. This Agreement shall be governed by the laws of the
State of Washington.
12.4 Attorneys' Fees. In any action or suit to enforce any right or remedy
under this Agreement or to interpret any provision of this Agreement,
the prevailing party shall be entitled to recover its costs, including
reasonable attorneys' fees.
12.5 Assignment. This Agreement shall be binding upon and inure to the
benefit of each party's respective successors and lawful assigns;
provided, however, that AudioNet may not assign its rights under this
Agreement, in whole or in part, to any third party without the prior
written approval of Microsoft. For purposes of this Agreement, a
merger, consolidation, or other corporate reorganization in which
AudioNet is not the surviving entity, the sale of all or substantially
all of AudioNet's assets or the sale in a single transaction or a
series of related transactions of more than 50% of the securities of
AudioNet entitled to vote in the election of directors to a person or
"group" (as such term is defined in the Exchange Act) other than any
such group that may exist or be deemed to exist as of the date hereof,
shall be deemed to be an assignment of this Agreement.
12.6 Construction. If for any reason a court of competent jurisdiction
finds any provision of this Agreement, or portion thereof, to be
unenforceable, that provision of the Agreement will be enforced to the
maximum extent permissible so as to effect the intent of the parties,
and the remainder of this Agreement will continue in full force and
effect. 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. This Agreement has been negotiated by the parties
and their respective counsel and will be interpreted fairly in
accordance with its terms and without any strict construction in favor
of or against either party.
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12.7 Entire Agreement. This Agreement does not constitute an offer by
Microsoft and it shall not be effective until signed by both parties.
This Agreement constitutes the entire agreement between the parties
with respect, to the subject matter hereof and merges all prior and
contemporaneous communications. It shall not be modified except by a
written agreement dated subsequent to the date of this Agreement and
signed on behalf of AudioNet and Microsoft by their respective duly
authorized representatives.
IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
Effective Date written above.
MICROSOFT CORPORATION AUDIONET, INC.
/s/ XXX XXXXXX /s/ XXXX XXXXX
----------------------------- -----------------------------
By (Sign) By (Sign)
Xxx Xxxxxx Xxxx Xxxxx
----------------------------- -----------------------------
Name (Print) Name (Print)
Product Unit Manager President
----------------------------- -----------------------------
Title Title
8/5/97 August 5, 1997
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Date Date
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EXHIBIT A
DESCRIPTION OF MICROSOFT SOFTWARE
[*]
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EXHIBIT B
CONSIDERATION
[*]
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EXHIBIT C
LIMITED THIRD PARTY DISCLOSURE
AudioNet may disclose the following in communications to its third party
customers, suppliers and current and prospective investors:
To be mutually agreed upon by the parties within five (5) days of the Effective
Date.
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