XBOX 360 ACCESSORY LICENSE AGREEMENT
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XBOX
360 ACCESSORY
LICENSE AGREEMENT
This
Xbox 360 Accessory License Agreement
(the
“Agreement”)
is made
and entered into as of the later of the two signature dates below (the
“Effective
Date”)
by and
between Qmotions, Inc. (“Company”),
a
California corporation, respectively, with its principal place of business
at
000
Xxxxxxxxxxx Xxxxxx, Xxxxxxxxx, XX 00000,
and
Microsoft Corporation, a Washington, U.S.A. corporation with its principal
place
of business at Xxx Xxxxxxxxx Xxx, Xxxxxxx, Xxxxxxxxxx 00000 (“Microsoft”).
1. Definitions.
1.1 “Approved
Subcontractor” means
a
Company subcontractor that is identified on Exhibit
H
and
provides manufacturing services for the Licensed Product(s).
1.2 “Approved
Vendor”
means
a
Microsoft-approved supplier of Xbox 360 Chips that is identified in Exhibit
F.
1.3 “Baseband
Chip”
means an
application specific integrated circuit that instantiates the Baseband Firmware
and is made by an Approved Vendor.
1.4 “Baseband
Firmware”
means
the proprietary Microsoft firmware instantiated on a silicon baseband chip
and
designed to allow the chip to operate within the Xbox 360 console platform.
1.5 “Branding
Specifications”
means
the specifications in Exhibit
B-2
for
using the Xbox 360 Logos, as such specifications may be updated or supplanted
by
Microsoft from time to time.
1.6 “Certification
Specifications”
means
the then-current Xbox 360 accessory and interface specifications used by
Microsoft or the Certification Testing Center to verify the compatibility
of
Proposed Products with the Xbox 360 console.
1.7 “Certification
Testing Center” means
an
entity identified on Exhibit
D,
as may
be updated by Microsoft from time to time, to verify the compatibility of
Proposed Products with the Xbox 360 console in accordance with the Certification
Specifications.
1.8 “Firmware”
means
(a) the Security Firmware, (b) the Wireless Firmware, and (c) the Baseband
Firmware, if Company licenses the Baseband Firmware as described in Section
3.2.
1.9 “Licensed Product”
means
a
Proposed Product that meets the Xbox 360 Certification Specifications, has
passed the Xbox 360 certification process described in Section 6, and meets
the
Quality Standards and Microsoft Standards.
1.10 “Licensed
for Xbox 360 Logo”
means
the “Licensed for Xbox 360 Logo” as provided by Microsoft to Company and
identified in Exhibit
B-1
for use
on the Product Package and related promotional materials, advertising and
documentation for Licensed Product(s) in accordance with the terms of this
Agreement.
1.11 “Microsoft
Materials”
means
the Technical Documentation, Firmware and Necessary Claims.
1.12 “Microsoft
Standards”
means
Microsoft’s restricted substances specifications (including without limitation
any lead-free product requirements), Vendor Code of Conduct and Microsoft’s
social and environmental compliance specification as released to Company
prior
to execution and delivery of this Agreement and as updated by Microsoft from
time to time.
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1.13 “Necessary
Claims”
means
claims (a) of a patent or patent application that Microsoft now or hereafter
owns or otherwise has the right to license to Company, without the payment
of
any royalty or other amounts to any unaffiliated third party, that (b) are
necessarily infringed by implementation of the Security Feature or the Wireless
Feature. For purposes of the foregoing, a claim is a “Necessary Claim” only when
it is not possible to avoid infringement, because there is no technically
reasonable, non-infringing alternative implementation. Further, notwithstanding
the foregoing, “Necessary Claims” do not include any claims: (1) other than
those set forth above, even if contained in the same patent or patent
application as Necessary Claims; (2) to any enabling technologies that may
be necessary to make or use any product (or a portion thereof) or combination
that implements the Security Feature or the Wireless Feature (such as hardware,
semiconductor manufacturing, compiler, object-oriented, operating system,
protocol, programming interface or networking technologies); (3) covering
the implementation of other published specifications that may be referenced
in
the Microsoft Materials; or (4) to the extent such claim covers any product
(or portion thereof) or combination, the purpose or function of which is
not
included in the Security Feature or the Wireless Feature.
1.14 “Product
Package”
means
the retail package containing the Licensed Product and other materials that
are
included with the Licensed Product.
1.15 “Proposed
Product”
means a
pre-release version of Company’s proposed accessory device that Company submits
to Microsoft or its Certification Testing Center to verify the device’s
compatibility with the Xbox 360 console in accordance with the Certification
Specifications.
1.16 “Quality
Standards”
means
the standards of workmanship, overall quality, and performance generally
accepted in the video game console accessory industry.
1.17 “Radio
Device”
means
either (a) the application specific integrated circuit that instantiates
the
Wireless Feature and is made by an Approved Vendor (i.e. the chip known by the
Microsoft internal code name “Xxxxx”) or (b) the module that instantiates the
Wireless Feature and is made by an Approved Vendor (i.e. the module known
by the
Microsoft internal code name “XxXxxxx”).
1.18 “Security
Chip”
means
the application specific integrated circuit that instantiates the Security
Feature and is made by an Approved Vendor.
1.19 “Security
Feature”
means
Microsoft’s proprietary protocol used to validate authentic devices on the Xbox
360 platform.
1.20 “Security
Firmware”
means
that proprietary Microsoft firmware that implements the Security Feature
and is
instantiated on a Security Chip.
1.21 “Technical
Documentation”
means
the specifications, reference code and other technical documentation listed
in
the attached Exhibit
A
or
otherwise delivered by Microsoft for Company’s use under this
Agreement.
1.22 “Term”
means
the term of the Agreement set forth in Section 15.1.
1.23 “Territory”
means
those countries or regions identified in Exhibit
E.
1.24 “Wireless
Feature”
means
Microsoft’s proprietary protocol used to enable wireless communication between
devices on the Xbox 360 platform.
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1.25 “Wireless
Firmware”
means
that proprietary Microsoft firmware that implements the Wireless Feature
and is
instantiated on a Radio Device.
1.26 “Wireless
Licensed Product” means
a
Licensed Product that includes the Wireless Feature, but only if Microsoft
has
approved the inclusion of the Wireless Feature in such Licensed Product during
the Product Review and Certification process described in Section 6.
1.27 “Xbox
360 Chip(s)”
means
(a) the Security Chip, (b) the Radio Device, and (c) the Baseband Chip, if
Company elects to license the Baseband Firmware in accordance with Section
3.2.
1.28 “Xbox
360 Logos” means
the
Licensed for Xbox 360 Logo and the Xbox 360 Product Jewel Logo,
collectively.
1.29 “Xbox
360 Product Jewel Logo” means
the
stylized Xbox 360 “X” logo as provided by Microsoft to Company and identified in
Exhibit
B-1
for use
on Licensed Product(s) in accordance with the terms of this
Agreement.
All
other
initially capitalized terms will have the meanings hereinafter assigned to
them.
2. Xbox
360 Development Kit (Peripherals) License.
Prior
to
submitting any Proposed Product for verification, Company must sign Microsoft’s
Xbox 360 Development Kit (Peripherals) (“PXDK”)
license agreement for third party accessory manufacturers. If Company will
use
an Approved Subcontractor to manufacture Licensed Products or provide
development services related to the Licensed Products, then prior to submitting
any corresponding Proposed Product, Company must require that Approved
Subcontractor to sign Microsoft’s PXDK license agreement.
3. Licenses.
3.1 Xbox
360 Security Feature and Wireless Feature.
Subject
to Company paying all applicable fees and royalties set forth in this Agreement,
Microsoft, on behalf of itself and its affiliates, grants to Company a personal,
nonexclusive, nontransferable, royalty-bearing, nonsublicensable license
to:
(a) make and use a reasonable number of copies of the Technical
Documentation, but only as necessary for the development of Licensed Products
that conform to the specifications included in the Technical Documentation;
(b) make derivative works based on source code that may be supplied in the
Technical Documentation (“Derivatives”),
but
only for incorporation into Licensed Products; (c) incorporate (i) object
code supplied in the Technical Documentation and (ii) Derivatives into the
Licensed Product; (d) use and distribute Security Firmware in the
Territory, but only as incorporated in Security Chips made by and purchased
from
Approved Vendors and included in Licensed Products; (e) use and distribute
Wireless Firmware in the Territory, but only as incorporated in Radio Devices
made by and purchased from Approved Vendors and included in Wireless Licensed
Products; and (f) only in the Territory, directly or indirectly sell, offer
for sale, import and distribute Licensed Products that implement (i) the
Security Feature alone, or (ii) the Security Feature and the Wireless Feature,
but only if the Licensed Product is a Microsoft-approved Wireless Licensed
Product. Except as specifically provided in (b), (c) and (d) of this
Section 3.1, the license grant above does not include any right to disclose
or incorporate into any product, including without limitation Licensed any
copy
of, or derivative work based upon, any Technical Documentation or
Firmware.
3.2 Baseband
Firmware.
Company
may elect to license the Baseband Firmware from Microsoft by notifying Microsoft
in writing and paying the Baseband Firmware Fee set forth in Exhibit
C.
Upon
Microsoft’s receipt of the Baseband Firmware Fee, Microsoft, on behalf of itself
and its affiliates, grants to Company a personal, nonexclusive, nontransferable,
royalty-bearing, nonsublicensable license to: use and distribute the Baseband
Firmware only in the Territory and only as incorporated in Baseband Chips
made
by and purchased from Approved Vendors and included in Licensed Products.
The
license grant above does not include any right to disclose or incorporate
into
any product, including without limitation Licensed Products, any copy of,
or
derivative work based upon, any Technical Documentation or
Firmware.
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3.3 Xbox
360 Chip(s).
The
license granted in Section 3.1 includes the right for Company to purchase
Security Chips (at a minimum purchase order quantity of 25,000 units) from
an
Approved Vendor for use with the Licensed Products, upon such pricing and
other
terms to be agreed upon between Company and the Approved Vendor. If the Licensed
Product is a Wireless Licensed Product, then the license granted in Section
3.1
includes the right for Company to purchase Radio Devices (at a minimum purchase
order quantity of 25,000 units) from an Approved Vendor for use with the
Licensed Products, upon such pricing and other terms to be agreed upon between
Company and the Approved Vendor. If Company elects to license the Baseband
Firmware, the license granted in Section 3.2 includes the right for Company
to
purchase the Baseband Chips (at a minimum purchase order quantity of 25,000
units) from an Approved Vendor for use with the Licensed Products, upon such
pricing and other terms to be agreed upon between Company and the Approved
Vendor. Microsoft reserves the right to require additional design or other
specifications relating to the Xbox 360 Chips and/or to add or decrease security
requirements, including, without limitation, implementation of the Security
Feature without using the Security Chip.
3.4 Restrictions.
(a) No
Reverse Engineering. Company
shall not reverse engineer, decompile, disassemble, or otherwise access the
source code for any portion of the Security Feature, Wireless Feature, or
Firmware except (i) as permitted by applicable law which cannot be waived
by
this subsection, or (ii) as authorized by separate agreement by Microsoft
or a
Microsoft affiliate. Company shall use commercially reasonable efforts to
design
Licensed Products to prevent third parties from reverse engineering, decompiling
or disassembling any portion of the Security Feature, Wireless Feature, and/or
Firmware and to prevent end users from discovering the source code of any
component of the underlying Security Feature, Wireless Feature, and/or
Firmware.
(b) No
Foundry Products. The
license grants above do not include any rights to make, use, sell, offer
for
sale, import or distribute Licensed Product designed by or for a third party
without substantial input from Company, and manufactured, reproduced, sold,
leased, licensed or otherwise transferred from Company to that third party
(or
to customers of, or as directed by, that third party) on essentially an
exclusive basis.
(c) Restricted
Software. Company
will not use any software subject to an Excluded License to make any derivative
of any Microsoft Materials or offer, sublicense or distribute any code supplied
in the Microsoft Materials or derivative of any such code in conjunction
with
any software subject to an Excluded License. “Excluded
License”
means
any license that requires that any (a) Microsoft Materials or component or
portion thereof, (b) other software, technology, product, service or
documentation incorporating or using any Microsoft Materials, or (c) other
software, technology, product, service or documentation combined and/or
distributed with any Microsoft Materials be: (x) disclosed or distributed
in
source code form; (y) licensed for the purpose of making derivative works;
or
(z) redistributable at no charge.
3.5 Reservation
of Rights.
All
rights not expressly granted in this Agreement are reserved. No additional
rights whatsoever (including, without limitation, any implied licenses) are
granted by implication, estoppel or otherwise. Microsoft retains ownership
of
all right title and interest in the Microsoft Materials.
4. Xbox
360 Logos.
4.1 Licensed
for Xbox 360 Logo. Microsoft
will provide Company with the required Licensed for Xbox 360 Logo artwork.
Upon
approval of the Licensed Product under Section 6.3 and subject to payment
of the
license fees and royalties set forth in Section 5, Microsoft grants to Company
a
non-exclusive, fully paid-up, non-transferable, revocable, personal
license to
use
the Licensed for Xbox 360 Logo during the Term only on Company’s Product Package
and related promotional materials, advertising, and documentation in connection
with the marketing, sales and distribution of the Licensed Product in the
Territory, according to the Branding Specifications and the other terms and
conditions set forth herein. Company
is not authorized or licensed to include the Licensed for Xbox 360 Logo on
the
Licensed Product itself or on any labels affixed to the Licensed Product
or as
part of any warranties made by the Company.
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4.2 Xbox
360 Product Jewel Logo.
In
addition to the license granted in 4.1, Microsoft grants to Company a
non-exclusive, fully paid-up, non-transferable, revocable, personal license
during the Term to place the Xbox 360 Product Jewel Logo only on Licensed
Product(s) intended for sale in the Territory, according to the Branding
Specifications and the other terms and conditions set forth herein. Company
is not authorized or licensed to include the Xbox 360 Product Jewel Logo
on any
promotional materials or advertising in connection with the marketing, sales
and
distribution of the Licensed Product(s), or as part of any warranties made
by
the Company. The Xbox 360 Product Jewel Logo is licensed to Company solely
for
placement on the Licensed Products as set forth herein.
4.3 Logo Usage
Approval.
(a)
Company
Submission.
Company
will deliver to Microsoft the Product Package and any other materials that
use
or refer to the Xbox 360 Logos or any other Microsoft name (“Submitted
Materials”).
Microsoft will review the Submitted Materials to confirm that the use of
the
Xbox 360 Logos in the Submitted Materials complies with the Branding
Specifications. Company must receive Microsoft’s approval of Submitted Materials
prior to any manufacture, distribution or publication of the same. All requests
for approval hereunder will be submitted to:
Xbox
Accessories Program Manager
Microsoft
Corporation, Xxx Xxxxxxxxx Xxx, Xxxxxxx, XX 00000, XXX
(b) Microsoft
Response.
Microsoft will respond to Company’s request for approval of Submitted Materials
within a commercially reasonable period of time. Microsoft’s approval or
rejection of the request from Company will be delivered via U.S. Mail or
e-mail
to:
|
Company
Contact:
|
Xxxx
Xxxxxxxx
|
|
|
Address:
|
Qmotions,
Inc.
|
|
|
X.X.
Xxx 0000,
|
||
|
|
Xxxxxxxxx,
XX 00000
|
If
requested, Company agrees to incorporate Microsoft’s comments or edits prior to
publication, manufacture or distribution of any Submitted Materials.
(c) Use
of Approved Materials. After
Microsoft has approved Submitted Materials, Company will manufacture, assemble,
publish, and distribute the Submitted Materials only as approved by Microsoft
and will make no changes to the Submitted Materials without first obtaining
Microsoft’s written approval of such change.
4.4 Logo
Usage Requirements and Restrictions.
(a) Branding
Specifications.
Company’s use of the Xbox 360 Logos will comply with the Branding Specifications
and will conform in all respects to the Submitted Materials finally approved
by
Microsoft as required hereunder.
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(b) No
Third Party Usage; No Merchandising. Company
is granted no right to permit any third party to use the Xbox 360 Logos in
any
manner without Microsoft’s prior written consent and any attempt to do so will
be void. Company’s license to use the Xbox 360 Logos in association with
Licensed Products will not extend to the merchandising or sale of related
or
promotional products under such Xbox 360 Logos.
(c) No
Co-Branding. Company
will not use the Xbox 360 Logos in association with any third party trademarks
in a manner that might suggest co-branding or otherwise create potential
confusion as to source or sponsorship of the Licensed Products or ownership
of
the Xbox 360 Logos without written consent (including via email).
(d) Other
Prohibited Uses. Company
will not use Xbox 360 Logos in connection with any activity that (i) disparages
Microsoft or its products or services; (ii) violates or infringes any
intellectual property of Microsoft; or (iii) violates any local, state, federal,
country, or international regulation or law.
(e) Remedy
of Non-Conformance. Upon
notice or other discovery of any non-conformance with the requirements or
prohibitions of this Section 4, Company will promptly remedy such
non-conformance and notify Microsoft of the non-conformance and remedial
steps
taken.
4.5 Assistance
in Protecting Logos. Company
will assist Microsoft in protecting and maintaining Microsoft’s rights in the
Xbox 360 Logos worldwide, including preparation and execution of documents
necessary to register the Xbox 360 Logos at Microsoft’s expense and giving
immediate notice to Microsoft of potential infringement of the Xbox 360 Logos
in
any country. Microsoft will have the sole right to and in its sole discretion
may commence, prosecute or defend, and control any action concerning the
Xbox
360 Logos. Company will not contest the validity of, or by act or omission
jeopardize, or take any action inconsistent with, Microsoft’s rights or goodwill
in the Xbox 360 Logos in any country, including attempted registration of
the
Xbox 360 Logos or use or attempted registration of any xxxx confusingly similar
thereto.
4.6 Logo Ownership.
Company
acknowledges Microsoft’s sole ownership of the Xbox 360 Logos worldwide and all
associated goodwill. Nothing in this Agreement or in the performance thereof,
or
that might otherwise be implied by law, will operate to grant Company any
right,
title, or interest in or to the Xbox 360 Logos other than as specified in
the
limited license granted in this Agreement. Company’s use of the Xbox 360 Logos
will inure solely to the benefit of Microsoft. Company hereby assigns and
will
assign in the future to Microsoft all rights it may acquire by operation
of law
or otherwise in the Xbox 360 Logos, including all applications or registrations
therefore, along with the goodwill associated therewith.
5. Payments.
5.1 License
Fees.
(a) Security
Feature Fee. Company
will pay Microsoft the fees set forth on Exhibit
C
for the
license of the Security Feature (the “Security
Feature Fee”).
The
Security Feature Fee is above and beyond the actual cost of the Security
Chip
that Company (or Approved Purchasers) will purchase from the Approved Vendor.
In
the event that Company purchases any Security Chips prior to the Effective
Date,
Company will pay the Security Feature Fee corresponding to such Security
Chips
within thirty (30) days after the Effective Date.
(b) Wireless
Feature Fee. For
Wireless Licensed Products, Company will also pay Microsoft the fees set
forth
on Exhibit
C
for the
license of the Wireless Feature (the “Wireless
Feature Fee”).
The
Wireless Feature Fee is above and beyond the actual cost of the Radio Device
that Company (or Approved Purchasers) will purchase from the Approved Vendor.
In
the
event that Company purchases any Radio Devices prior to the Effective Date,
Company will pay the Wireless Feature Fee corresponding to such Radio Devices
within thirty (30) days after the Effective Date.
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(c) Setup
and Firmware Fees.
Company
will also pay Microsoft the applicable Setup and Firmware Fees identified
in
Exhibit
C.
5.2 Logo Royalties.
(a) Logo
Royalties.
In
consideration of the Xbox 360 Logo license rights granted Company for the
Licensed Products, Company will pay to Microsoft the Xbox 360 Logo Royalties
set
forth on Exhibit
C.
The
royalty obligation is triggered on the shipment of Licensed Product(s) to
customers.
(b) Royalty
Reports and Payments.
Company
will make quarterly royalty reports to Microsoft within (i) forty-five (45)
days
after the end of each calendar quarter during the Term; (ii) fifteen (15)
days
after termination of this Agreement in the event there is no “Sell Off Period”
as referenced in Section 15.3; or (iii) in the event there is a “Sell Off
Period” as referenced in Section 15.4, within fifteen (15) days after the end of
each calendar month during the Sell Off Period and a final report and payment
within fifteen (15) days of the end of the Sell Off Period. The royalty report
will include monthly sales information and be in a reasonable form as defined
by
Microsoft. For each calendar quarter, Company will remit payment(s) in
accordance with Section 5.3 in United States Dollars at the same time as
submission of the royalty report.
5.3 Place
of Payment.
Microsoft will address invoices for fee and royalty payments owed by Company
to:
|
Company
Contact:
|
Accounts
Payable
|
|
|
Address:
|
Qmotions,
Inc.
|
|
|
X.X.
Xxx 0000
|
||
|
|
Xxxxxxxxx,
XX 00000
|
The
statements required pursuant to this Section will be delivered by Company
to:
| Reports: |
Quarterly
royalty reports should be sent via email
to:
|
Microsoft
Licensing, GP (MLGP)
Xbox
360
Accessories Accounting Services
Payments
will be sent via wire transfer in U. S. Dollars only to:
or
such
other address of account as Microsoft may specify from time to
time.
5.4 Audit. During
the Term and for a period of at least three (3) years thereafter, Company
shall
keep and maintain complete and accurate books and records relating to its
performance (and any of its manufacturer’s performance) under this Agreement.
Upon not less than fourteen (14) days advance written notice from Microsoft,
Company shall make such books and records available for audit by Microsoft’s
internal audit team or an independent certified public accounting firm (together
with independent technical personnel if and as reasonably required for such
accountant to perform the audit) designated by Microsoft and approved by
Company, which approval shall not be unreasonably withheld. Unless otherwise
agreed by Microsoft and Company, any such audit shall be conducted during
regular business hours, at Company’s principal place of business, not more
frequently than once in any period of twelve (12) consecutive months and
in a
manner that does not unreasonably interfere with Company’s normal course of
business. If any audit reveals an overpayment, then Company will receive
a
credit, in the amount of such overpayment, that will be applied only against
future royalties payable under Section 5.2. If any audit reveals an
underpayment, then Company will pay Microsoft the amount of the underpayment,
together with interest as provided for in Section 5.5, within forty-five
(45) days after the date of the auditor’s report. Further, if any audit reveals
an underpayment of more than five percent (5%) of the royalties owed for
the
royalty periods subject to the audit, then Company will promptly reimburse
Microsoft, upon request, for all costs and expenses reasonably incurred by
Microsoft to conduct the audit.
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5.5 Delinquent
Payment.
Any
license fee, royalty or other amount not paid when due and otherwise in
accordance with this Section 5 shall bear interest at the rate of one
percent (1%) per month or the highest rate permitted by applicable usury
law,
whichever is less, calculated on a daily basis and compounded on the first
day
of each calendar month, from the date due until the date received by Microsoft
in accordance with Section 5.3. This Section 5.5 does not authorize
late payments, and the payment of interest hereunder shall not be lieu of
or
prejudice any other right or remedy that Microsoft may have on account of
Company’s failure to make any payment in accordance with this Section 5.
5.6 Taxes.
Company
shall be responsible for the billing, collecting and remitting of sales,
use,
value added, and other comparable taxes due with respect to the exercise
of the
licenses granted in this Agreement and any other activities of Company and
its
subsidiaries under this Agreement (including, without limitation, the collection
of revenues). Microsoft is not liable for any taxes (including, without
limitation, any penalties or interest thereon) that Company or any of its
subsidiaries is legally obligated to pay in connection with this Agreement,
the
exercise of any licenses granted in this Agreement or any other activities
of
Company and its subsidiaries under this Agreement. Company is not liable
for any
income taxes that Microsoft is legally obligated to pay with respect to any
amounts paid to Microsoft by Company under this Agreement.
All
royalties and fees exclude any taxes, duties, levies, fees, excises or tariffs
imposed on any of Company’s activities in connection with this Agreement.
Company shall pay to Microsoft any applicable taxes that are owed by Company
solely as a result of entering into this Agreement and which are permitted
to be
collected from Company by Microsoft under applicable law, except to the extent
that Company provides to Microsoft a valid exemption certificate for such
taxes.
Company agrees to indemnify, defend and hold Microsoft harmless from any
taxes
(including, without limitation, sales or use taxes paid by Company to Microsoft)
or claims, causes of action, costs (including, without limitation, reasonable
attorneys’ fees) and any other liabilities of any nature whatsoever related to
such taxes.
If,
after
a determination by foreign tax authorities, any taxes are required to be
withheld on payments made by Company to Microsoft, Company may deduct such
taxes
from the amount owed Microsoft and pay them to the appropriate taxing authority;
provided, however, that Company shall promptly secure and deliver to Microsoft
an official receipt for any such taxes withheld or other documents necessary
to
enable Microsoft to claim a U.S. Foreign Tax Credit. Company will make certain
that any taxes withheld are minimized to the extent possible under applicable
law.
This
tax
section shall govern the treatment of all taxes arising as a result of or
in
connection with this Agreement notwithstanding any other section of this
Agreement.
6. Product
Review and Certification.
6.1 Review
of Proposed Product. Company
will identify a single contact person for all business development activity
relating to Proposed Products. Company
will submit its plans for Proposed Products to Microsoft for review against
Xbox
360 hardware and software game categories. Feedback regarding the category
fit
of any Proposed Product may be provided by Microsoft in its sole discretion
to
maintain consistent and compatible Xbox 360 accessory products. Company’s plan
for Proposed Products will be in writing, and will include at least (to the
extent applicable): (a) detailed description of the design, technical and
marketing suitability of the Proposed Product, (b) expected suggested retail
pricing of the Proposed Product, (c) whether the Proposed Product is intended
to
result in a Wireless Licensed Product; and (d) estimated annual sales volumes
by
world region of the Proposed Product(s) based upon assumptions provided by
Company.
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6.2 Authorization
of Security Feature, Wireless Feature and Xbox 360 Chip(s).
Upon
Microsoft’s approval of the plan for each Proposed Product, Company may request
sample Security Chips, Radio Devices (if the Proposed Product approved by
Microsoft is intended to result in a Wireless Licensed Product), and Baseband
Chips from the applicable Approved Vendor in quantities approved by Microsoft.
Company will use the sample Xbox 360 Chips solely for Proposed Product
development and certification testing per Microsoft’s Technical Documentation
and Certification Specifications. Upon such approval, Company may also initiate
discussions with the Approved Vendor to reach agreement on supply of the
Xbox
360 Chips including price, schedule and other purchase order requirements.
Such
agreement will include an authorization from Company for Approved Vendor
to
release information to Microsoft about the number of Xbox 360 Chips purchased.
6.3 Certification
of Proposed Product.
(a) Requirements
for Certification. Microsoft
will at all times control requirements for Xbox 360 certification testing.
Modifications to the Certification Specifications and Branding Specifications
may be implemented by Microsoft at any time during the Term, but will not
be
retroactive to any Licensed Product already certified by Microsoft or its
Certification Testing Center.
(b) Proposed
Product Submission.
Company
will, at its sole cost and expense, deliver to Microsoft or Microsoft’s
Certification Testing Center a minimum of seven (7) units of the Proposed
Product for certification. Company represents and warrants that: (i) all
Proposed Products units submitted are representative of product ready for
release for general distribution; (ii) Company has adequately and extensively
tested the Proposed Products using the PXDK test equipment required by
Microsoft; (iii) there are no errors in the Proposed Products. If
requested by Microsoft, Company will also provide Microsoft or the Certification
Testing Center with copies of all End User installation and technical reference
manuals for the Proposed Product, as well as any other documentation reasonably
requested by Microsoft for operating the Proposed Product and/or conducting
the
certification activities.
(c) Proposed
Product Review. The
Proposed Product
units will be reviewed for compliance with the Certification Specifications
in
effect at the time of review. Company will be responsible for supplying any
necessary documentation to operate the Proposed Product for verification
purposes and for designating a single contact person for technical assistance.
If the certification is provided by a Certification Testing Center, Company
will
pay all verification fees required by the Certification Testing Center and
will
execute any additional contracts required by the Certification Testing Center.
Microsoft is not liable for any damage to the Proposed Product units while
in
transit to and on Microsoft’s premises or that of the Certification Testing
Center.
(d) Testing
Schedule; Reports. Company
will schedule all certification testing at least three (3) weeks in advance
or
shorter time as agreed to by Microsoft or the Certification Testing Center.
Certification will be performed by Microsoft or the Certification Testing
Center
subject to the availability of its resources and staff.
Microsoft will report to Company on status of testing within two weeks of
Company’s submission, but nothing in this Section will require Microsoft to
complete testing within such time.
(e) Failure
to Pass Certification. If
a
Proposed Product fails to meet the Certification Specifications, Microsoft
or
the Certification Testing
Center
will
provide Company with a written report indicating the reasons for such failure
but will
not
provide
recommendations for improvements to the Proposed Product. Company will promptly
replace, repair, or withdraw the Proposed Product from further certification
testing.
Microsoft will not refund any advance license fees paid for a Proposed Product
that does not pass certification testing.
(f) Additional
Product Requirements.
In
addition to meeting the Certification
Specifications and passing the Xbox 360 certification testing, all Proposed
Products will be of a quality at least commensurate with the quality of products
distributed by Company before the Effective Date and will meet or exceed
the
Quality Standards and Microsoft Standards. On an annual basis, a Company
officer
will certify compliance with the Microsoft Standards in writing in a form
substantially similar to that attached in Exhibit
G
as
updated from time to time by notice from Microsoft. In the event Microsoft
rejects the Proposed Product for failure to comply with the Quality Standards
or
Microsoft Standards, Company will correct and then resubmit the Proposed
Product
to Microsoft, or withdraw the Proposed Product from any further certification
testing. Microsoft
will not refund any advance license fees paid for a Proposed Product that
does
not pass certification testing or meet the Quality Standards or Microsoft
Standards.
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6.4 Approval
to Deliver Xbox 360 Chip(s). Upon
final approval of each Licensed Product, Microsoft will inform the applicable
Approved Vendor of such approval and authorize the Approved Vendor to sell
the
applicable Xbox 360 Chips to Company for use in the Licensed Product.
6.5 Control
of Xbox 360 Chip(s).
Company
must provide to Microsoft a detailed plan for secure handling, storage, and
scrap of Security Chips by Company ninety (90) days prior to their first
receipt
of Xbox 360 Chips. The detailed plan must include full material handling,
storage and scrap procedures in place at all Company’s manufacturing facilities
where Xbox 360 Chips are delivered, stored, and utilized in Licensed Products.
Microsoft has the right to require additional handling, storage and scrap
procedures to ensure adequate controls of Xbox 360 Chips.
6.6 Final
Retail Product Samples.
Upon
final approval, Company will provide at no cost to Microsoft twenty (20)
final
retail packaged Licensed Products for use in its test and game certification
laboratories. These units will be used for compliance testing on current
and
future products.
6.7 Prohibition
on Unauthorized Manufacture or Distribution.
Unless
otherwise approved by Microsoft in writing, in no event will Company manufacture
or distribute a Proposed Product or any other product that Company claims
to be
compatible with the Xbox 360 console or accessories without such product
being a
Licensed Product under the terms of this Agreement.
7. No
Restriction on Independent Development.
Nothing
in this Agreement will be construed as restricting Microsoft’s ability to
acquire, license, develop, manufacture or distribute for itself, or have
others
acquire, license, develop, manufacture or distribute any software, firmware,
or
hardware with the same or similar functionality as the Proposed Product(s)
or
Licensed Product(s), or to market and distribute such other technology and
products.
8. Product
Manufacturing.
Company
is solely responsible for manufacturing, designing, testing, labeling (including
all warnings, use instructions and regulatory compliance), warehousing,
distributing, promoting, selling and if necessary recalling the Licensed
Products. Company is also responsible for ensuring that all commercially
released versions of the Licensed Products are free of defects in material,
manufacture and design, and comply with all applicable domestic and
international regulations, standards and other laws and standards governing
restricted substances, product safety and consumer protections. In no event
will
Microsoft be deemed to have any such responsibilities with regard to the
Licensed Products. In particular, under any recycling, collection, recovery,
reuse, disposal and/or waste management legislation, Company agrees that
it is
solely responsible for all Licensed Products as a producer and that Microsoft
has no responsibility therefor. Company hereby indemnifies Microsoft in the
event that its failure to comply with its responsibilities as a producer
or any
of its acts or omissions leads to a claim or action being made against Microsoft
for Licensed Products under such legislation. Company will provide Microsoft
with the name and address of the manufacturers of the Licensed Products and
the
location of their manufacturing facilities, and will provide Microsoft with
no
less than thirty (30) days prior written notice in the event of any changes
of
such manufacturer. Company will institute manufacturing processes and tests
so
as to ensure that all units of the Licensed Products manufactured by or for
Company meet the Quality Standards and Microsoft Standards, comply with all
applicable regulations, standards and other laws and are in compliance with
the
version of the Proposed Product approved by Microsoft under Section 6 of
this
Agreement. Company agrees to provide Microsoft with samples of the Licensed
Product(s) from time to time for purposes of verifying that they continue
to
meet the Certification Specifications and Quality Standards. Upon notice
or
other discovery of any non-conformance of the Licensed Product or Product
Package with the Quality Standards, Microsoft Standards or Certification
Specifications (including receipt of any bona fide end user claims or complaints
pertaining to consumer product safety matters), Company will promptly notify
Microsoft and remedy such non-conformance in all such Licensed Product units
or
Product Packages regardless of where such are in the chain of distribution,
and
Company will notify Microsoft of the remedial steps taken.
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9. Permission
to Demonstrate.
Company
hereby grants permission to Microsoft to use and display Licensed Products
at
conventions, events, trade shows, press briefings, and the like, and to use,
depict, broadcast, and otherwise display the Licensed Products in advertising
and promotional material relating to Xbox 360 and related Microsoft products
and
services, as Microsoft may reasonably deem appropriate.
10. Confidentiality;
Press Announcements; Product Listing.
10.1 Non-Disclosure
Agreement.
Microsoft and Company agree that the terms of the Non-Disclosure Agreement
(“NDA”)
executed by the parties on February
12th 2008
are
incorporated herein by this reference. Further, the parties agree that all
terms
and conditions of this Agreement will be deemed Microsoft Confidential
Information as defined in the NDA. In the event that any independent contractor
of Company will require access to Microsoft Confidential Information for
the
purposes of fulfilling Company’s obligations under this Agreement, Company will
enter into written confidentiality agreements with such independent contractors
which are at least as protective of the Microsoft Confidential Information
as is
the NDA.
10.2 Press
Releases.
Microsoft and Company agree that Company’s initial press release or
communication to the press and/or public regarding this Agreement, and any
subsequent press releases to be published by Company which refer to Microsoft
or
Xbox 360, will be mutually agreed upon prior to Company’s release to the public.
Company’s requests for approval and Microsoft’s reply thereto will be sent to:
Xbox
Accessories Program Manager
Microsoft
Corporation, Xxx Xxxxxxxxx Xxx, Xxxxxxx, XX 00000, XXX
10.3 Mandated
Disclosure of this Agreement.
Notwithstanding Sections 10.1 and 10.2, the parties acknowledge that this
Agreement, or portions thereof, may be required under applicable law to be
disclosed as part of or an exhibit to either party’s required public disclosure
documents. If either party is advised by its legal counsel that such disclosure
is required, it will notify the other in writing and the parties will jointly
seek confidential treatment of this Agreement to the maximum extent reasonably
possible, in documents approved by both parties and filed with the applicable
governmental or regulatory authorities, and/or Microsoft will prepare a redacted
version of this Agreement for such filing.
10.4 Access
to Xbox 360 Game Publishers.
Microsoft agrees that Company may work with publishers and developers of
Xbox
360 platform game products, under terms and conditions to be agreed upon
by
Company and such publisher/developer, for Company’s potential creation of
Proposed Products that will maximize such publishers’/developers’ Xbox 360 game
products. Nothing in this Agreement will prohibit Company from distributing
Company’s Licensed Products as a packaged set together with any third party’s
Xbox 360-compatible game products.
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DENOTED
WITH “***”
10.5 Product
Listing.
Microsoft may, but is not obligated to, post information regarding the Licensed
Products on applicable Microsoft websites provided that Company has not
requested that Microsoft exclude the Licensed Products from such posting.
11. End
User Warranties.
Company
will be solely responsible for the distribution, marketing, sales, maintenance,
and End User warranties of the Licensed Products, and for providing technical
and all other support to distributors and End Users of the Licensed Products.
Company will provide all distributors and End Users of the Licensed Products
with Company’s contact information (including without limitation Company’s
street address and telephone number, and the applicable individual/group
responsible for customer support. Such distributor and End User support will
be
consistent with the then-applicable video game accessory industry standards.
Company acknowledges and agrees that Microsoft will have no responsibilities
whatsoever for any of the foregoing and that Company will be solely responsible
for any and all End User warranty claims.
12. Company
Warranties to Microsoft.
Company
warrants and represents that:
12.1 It
has
the full power and authority to enter into this Agreement.
12.2 The
Licensed Products and Product Package comply with all relevant domestic and
international regulations, standards, and other laws, including without
limitation those pertaining to environmental, restricted substances, recycling,
disposal, reuse, waste management, labor, worker safety, product safety and
consumer protections applicable to the Licensed Products and Product Packaging,
and Company expressly acknowledges that Microsoft has not undertaken and
has no
duty to test, verify or otherwise ensure that the Licensed Products, or Product
Package complies with such regulations, standards, and laws.
12.3 The
Licensed Products comply with the Quality Standards, Microsoft Standards,
and
the Certification Specifications and the Licensed Products, Product Package,
and
all marketing materials comply with the Branding Specifications.
12.4 Company
has and will maintain throughout the Term and for at least two (2) years
thereafter, a comprehensive general liability insurance policy with respect
to
the Licensed Product(s) in an amount not less than U.S.$2,000,000.00 per
occurrence. Microsoft will be a named insured on said policy and Company
will
provide to Microsoft a Certificate of Insurance evidencing Microsoft’s status as
an additional insured within 30 days of execution of this Agreement and only
at
Microsoft’s request a copy of said policy. Company will provide Microsoft with
thirty (30) days prior written notice in the event of any policy cancellation
or
a material change in the terms or provisions of such policy.
12.5 Notwithstanding
anything to the contrary contained in this Agreement, in the event Microsoft
learns of a material variance in the Licensed Products’ compliance with the
Quality Standards, Microsoft Standards or Certification Specifications or
Company’s warranty in Section 12.2, Microsoft may terminate this Agreement in
accordance with Section 15.2(a).
13. Microsoft
Warranties to Company; Disclaimer of Warranties; Exclusion of Damages;
Limitation of Liability.
13.1 Warranties.
Microsoft warrants and represents that: (a) it has the full power to enter
into
this Agreement; and (b) it has not previously and will not grant any rights
to
any third party that are inconsistent with the rights granted to Company
herein.
13.2 DISCLAIMER.
EXCEPT
AS EXPRESSLY STATED IN SECTION 13, MICROSOFT PROVIDES ALL MATERIALS, LICENSES
AND SERVICES HEREUNDER ON AN “AS IS” BASIS, AND MICROSOFT DISCLAIMS ALL OTHER
EXPRESS OR IMPLIED WARRANTIES UNDER THE APPLICABLE LAWS OF ANY COUNTRY REGARDING
THE MATERIALS, LICENSES AND SERVICES, INCLUDING ANY IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR WARRANTY OF
NON-INFRINGEMENT OR WITH REGARD TO THE SCOPE, COVERAGE, VALIDITY OR
ENFORCEABILITY OF ANY NECESSARY CLAIMS OR THAT ANY NECESSARY CLAIMS OR OTHER
INTELLECTUAL PROPERTY RIGHTS APPLY WORLDWIDE. THE
ENTIRE RISK AS TO THE QUALITY, USE, OR PERFORMANCE OF ANY MATERIALS PROVIDED
BY
MICROSOFT HEREUNDER REMAINS WITH COMPANY.
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13.3 EXCLUSION
OF INCIDENTAL, CONSEQUENTIAL AND CERTAIN OTHER DAMAGES. To the
maximum extent
permitted by applicable law, in no event will Microsoft, its affiliates,
subsidiaries, licensors or its suppliers be liable for any special, incidental,
indirect, or consequential damages whatsoever under this Agreement (including,
but not limited to, damages for loss of profits or confidential or other
information, for business interruption, for personal injury, for failure
to
warn, for failure to meet any duty including of good faith or of reasonable
care, for negligence, and for any other pecuniary or other loss whatsoever)
even
if Microsoft has been apprised of the likelihood of such damages.
13.4 Limitation
of Liability and Remedies.
Notwithstanding any damages that Company might incur for any reason whatsoever
(including, without limitation, all damages referenced above and all direct
or
general damages), the entire liability of Microsoft, its affiliates, licensors
and any of its suppliers under any provision of this Agreement and Company’s
exclusive remedy for all of the foregoing, will be limited to the cumulative
sum
of all license fees and royalty payments received by Microsoft from Company
under this Agreement. The foregoing limitations, exclusions and disclaimers
will
apply to the maximum extent permitted by applicable law, even if any remedy
fails its essential purpose.
14. Indemnity.
14.1 Company’s
Indemnity of Microsoft. Company
will defend, indemnify and hold harmless Microsoft and Microsoft’s affiliates
and subsidiaries, and their respective directors, officers, employees, agents,
customers and distributors of each of the foregoing from and against any
and all
claims, actions, demands, legal proceedings, liabilities, damages, losses,
judgment, authorized settlements, costs and expenses, including without
limitation actions by private parties or governmental agencies and reasonable
attorney’s fees, arising out of or in connection with any actual or alleged:
(a) claim
that, if assumed to be true, would constitute a breach of a Company warranty,
representation or covenant set forth in this Agreement; and/or
(b) claim
relating to the Proposed Product(s), Licensed Product(s), Product Package
or the
marketing thereof (except to the extent that Microsoft is obligated to indemnify
Company for trademark infringement claims under14.3), including without
limitation: (A) claims of actual or alleged infringement by Company, a Proposed
Product, a Licensed Product, and/or Product Package, of any patent, copyright,
trade secret, mask work right, trademark or other proprietary right of any
third
party except to the extent that such infringement arises from the Xbox 360
Logos, the Firmware, the Security Feature, or the Wireless Feature; (B) claims
by any third party that a Proposed Product, Licensed Product, and/or Product
Package has caused any injury or bodily harm (including death) or has damaged
real property or personal property or the environment; (C) claims based on
a
violation by Company of, or failure of Proposed Product, Licensed Product,
and/or Product Package to comply with, any applicable law or regulation;
(D)
claims by or on behalf of any subcontractor, supplier, employee or agent
of
Company; and/or (E) claims related to Company’s use of the Xbox 360 Logos in a
manner not authorized under this Agreement.
14.2 Indemnity
Procedures. In
the
event Microsoft becomes aware of any such claim, Microsoft shall: (a) reasonably
promptly notify Company thereof; and (b) provide Company with reasonable
cooperation in the defense thereof. Unless such claim or the defense thereof
could give rise to criminal liability or could have a material effect on
Microsoft’s business in the jurisdiction of such proceeding, Microsoft will not
settle any such claim without Company’s consent, which will not be unreasonably
withheld. Microsoft will have the right to approve the counsel selected by
Company to defend any such claim (such approval not to be unreasonably withheld)
and will also have the right to have its own counsel participate in the defense
of any such claim at Microsoft’s own expense. Notwithstanding the foregoing, and
without prejudice to Company’s indemnification obligations or Microsoft’s other
rights hereunder, Microsoft will be entitled (using its own counsel and without
the consent of Company) to control the defense of, and settle, any claim
if
Company does not, upon Microsoft’s demand, acknowledge in writing Company’s full
responsibility to indemnify therefor.
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14.3 Microsoft’s
Indemnity of Company. Microsoft
will defend, indemnify and hold Company and Company’s affiliates, directors,
officers, employees, licensees, agents and independent contractors harmless
from
and against any costs, damages and fees reasonably incurred by Company,
including but not limited to fees of attorneys and other professionals, that
are
attributable to any third-party claim that the Xbox 360 Logos infringe the
trademark of such third party in those countries in which Microsoft distributes
the Xbox 360 video game consoles. Company will provide Microsoft reasonably
prompt notice in writing of any such claims and provide Microsoft with
reasonable information and assistance, at Microsoft’s expense, to help Microsoft
to defend such claims.
15. Term
and Termination.
15.1 Term.
The term
of this Agreement will commence on the Effective Date and unless terminated
earlier as provided in Section 15.2, will continue until two (2) years after
the
Effective Date. Thereafter the Term will automatically renew for successive
one-year periods until the last year Microsoft distributes the Xbox 360 version
console unless either party gives written notice of its intent not to renew
no
less than ninety (90) days prior to the expiration of the initial or any
subsequent renewal term.
15.2 Termination
for Cause.
(a) By
Microsoft. Microsoft
may terminate this Agreement for cause immediately in the event that the
PXDK
license between Microsoft and Company is terminated or in the event of any
breach by Company of the license provisions in Section 3 or 4. Microsoft
may
immediately terminate this Agreement for cause in the event of any of the
following: (i) if Company is in material breach or default of any
representation, warranty, covenant or agreement hereunder or fails to continue
to perform its obligations hereunder, which breach or default is not cured
within thirty (30) days of written notice from Microsoft; (ii) if Company
becomes insolvent, or (iii) if Company becomes the subject of any proceeding
under any bankruptcy, insolvency or liquidation law, whether domestic or
foreign
and whether voluntary or involuntary, which is not resolved favorably to
Company
within sixty (60) days of commencement thereof; or (iv) if Company becomes
subject to property attachment, court injunction or court order which has
a
material adverse effect on its operations.
(b) By
Company.
Company
may terminate this Agreement upon thirty (30) days’ written notice to Microsoft
if Microsoft becomes the subject of any proceeding under any bankruptcy,
insolvency or liquidation law, whether domestic or foreign and whether voluntary
or involuntary, which is not resolved favorably to Microsoft within sixty
(60)
days of commencement thereof.
15.3 Effect
of Termination; Sell-off Rights.
In the
event of any termination of this Agreement and subject to any Sell-off Period,
Company will immediately (a) cease manufacture and distribution of the Licensed
Product, (b) cease all use of the Xbox 360 Logos and Microsoft Materials,
(c)
cancel all purchase orders for Xbox 360 Chips, (d) destroy all tooling that
contains Xbox 360 Logos, (e) dispose of Product Packages at Company’s
expense as directed by Microsoft in its sole discretion, and (f) return or
destroy, in accordance with its handling, storage, and scrap plan as provided
for in section 6.5 of this Agreement, all unused Xbox 360 Chips. Notwithstanding
the foregoing, upon the expiration or termination of this Agreement pursuant
to
a notice of non-renewal under Section 15.1 or under Section 15.2 above, or
in
the event this Agreement is terminated by Company under Section 15.2(b),
Company
will have the right to continue to sell or otherwise dispose of Licensed
Product
which is in Company’s inventory on the date of such termination or expiration,
such right to continue for six (6) months after such expiration or termination
(the “Sell-off
Period”),
provided that Company will not manufacture amounts of Licensed Product in
anticipation of such termination or expiration which is in excess of orders
expected to be received prior to the termination or expiration date. Company
will immediately destroy any inventory units of Licensed Product remaining
after
the Sell-off Period. Any and all sales or other dispositions of the Licensed
Product made under the provisions of this Section 15.3, including such during
any Sell-Off Period, will be subject to all of the provisions of this Agreement.
Sales by Company to end users and distributors prior to any termination or
expiration of this Agreement will not be abridged or diminished by any
expiration or termination of this Agreement.
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DENOTED
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15.4 Return
of Materials.
Upon the
expiration or termination of this Agreement, each party will promptly return
to
the other all Confidential Information and other materials of the other that
were held by each under the terms of this Agreement.
15.5 Survival.
The
provisions of Sections 1, 4.6, 5.3, 7, 8, 10, 11, 12, 13, 14, 15.5, and 16
will
survive any termination or expiration of this Agreement.
16. Miscellaneous.
16.1 Governing
Law; Attorneys’ Fees.
(a) Governing
Law.
This
Agreement will be construed and controlled by the laws of the State of
Washington, and Company further consents to jurisdiction by the state and
federal courts sitting in the State of Washington. The parties agree that
the U.
N. Convention on Contracts for the International Sale of Goods does not apply
to
this Agreement. Process may be served on either party by U.S. Mail, postage
prepaid, certified or registered, return receipt requested, or by such other
method as is authorized by the Washington Long Arm Statute. This Section
16 does
not prevent Microsoft from seeking injunctive relief with respect to a violation
of intellectual property rights or confidentiality obligations in any
appropriate jurisdiction.
(b) Attorneys’
Fees. If
either
Microsoft or Company employs attorneys to enforce any rights arising out
of or
relating to this Agreement, the prevailing party will be entitled to recover
reasonable attorneys’ fees.
16.2 Notices
and Requests. All
notices and requests in connection with this Agreement will be deemed given
as
of the day they are received either by messenger, delivery service, or in
the
U.S. mail, postage prepaid, certified or registered, return receipt requested,
and addressed as follows:
| Company: |
Mr.
Amro X. Xxxxxxx, CEO
QMOTIONS,
INC.
Physical
Address: 000 Xxxxxxxxxxx Xxxxxx, Xxxxxxxxx, XX 00000
Mailing
Address: X.X. Xxx 0000, Xxxxxxxxx, XX
00000
|
| with a cc to: |
Xx. Xxxx X. Xxxxxxxx, President
ACTIGA
CORPORATION
|
|
Mr.
Xxxx Xxxxxxxx, President
QMOTIONS,
INC.
Physical
Address: 000 Xxxxxxxxxxx Xxxxxx, Xxxxxxxxx, XX 00000
Mailing
Address: X.X. Xxx 0000, Xxxxxxxxx, XX
00000
|
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DENOTED
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|
|
Microsoft: |
MICROSOFT
CORPORATION
Xxx
Xxxxxxxxx Xxx
Xxxxxxx,
XX 00000-0000
|
| with a cc to: |
MICROSOFT
CORPORATION
Xxx
Xxxxxxxxx Xxx
Xxxxxxx,
XX 00000-0000
|
or
to
such other address as the party to receive the notice or request so designates
by written notice to the other.
16.3 Assignment.
This
Agreement, and any rights or obligations hereunder will not be assignable
by
Company by contract or by operation of law without first obtaining Microsoft’s
written consent. An assignment will be deemed to include without limitation
(a)
a merger of Company with another party, whether or not Company is the surviving
entity, (b) the acquisition of more than twenty percent (20%) of any class
of
Company’s voting stock by another party, or (d) the sale or other transfer
of more than fifty percent (50%) of Company’s assets (whether in a single
transaction or series of transactions) any of which results in the assumption
of
management control by another corporation or its nominees. Microsoft may
assign
this Agreement in whole or in part to any affiliate or subsidiary (direct
or
indirect) or in connection with any merger, reorganization or consolidation.
Subject to the limitations of this Section 16, this Agreement will inure
to the
benefit of and be binding upon the parties, their successors, administrators,
heirs, and permitted assigns. Any attempted transfer or assignment in violation
of this Section will be void; and, in the event of any such assignment or
attempted assignment by Company, Microsoft shall have the right to immediately
terminate the Agreement.
16.4 Independent
Contractors. This
Agreement is intended solely as a license agreement, and no partnership,
joint
venture, agency, or other form of agreement or relationship is
intended.
16.5 Enforceability/Waiver.
If
any
provision of this Agreement will be held by a court of competent jurisdiction
to
be illegal, invalid or unenforceable, the remaining provisions will remain
in
full force and effect.
No
waiver of any breach of any provision of this Agreement will constitute a
waiver
of any other breach of the same or any other provision hereof, and no waiver
will be effective unless made in writing and signed by an authorized
representative of the waiving party.
16.6 Government
Approvals.
Company
shall, at its own expense, obtain and arrange for the maintenance in full
force
and effect of all foreign and domestic governmental and regulatory approvals,
consents, licenses, authorizations, declarations, filings, and registrations
as
may be necessary or advisable for the performance of all of the terms and
conditions of the Agreement including, but not limited to, foreign exchange
approvals, import and offer agent licenses, fair trade approvals and all
approvals which may be required to realize the purposes of the
Agreement.
16.7 Injunctive
Relief. The
parties agree that Company’s threatened or actual unauthorized use of the Xbox
360 Logos or Microsoft Materials, whether in whole or in part, will result
in
immediate and irreparable damage to Microsoft for which there is no adequate
remedy at law, and in such event Microsoft will be entitled to appropriate
injunctive relief, without the necessity of posting bond or other
security.
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16.8
Entire Agreement/Modification. The
parties hereto acknowledge that they have read this entire Agreement and
understand it, and they agree to be bound by all its terms and conditions.
They
further agree that this Agreement, the NDA and all exhibits hereto constitute
a
single, integrated written contract expressing the entire agreement between
the
parties with respect to the subject matter hereof and all prior and
contemporaneous communications and negotiations, whether written or oral,
have
been and are merged and integrated into, and are superseded by, this integrated
written agreement. No covenants, agreements, representations or warranties
of
any kind whatsoever have been made by any party hereto, except as specifically
set forth in this integrated written contract. This Agreement will not be
modified except by a written agreement of even date herewith or subsequent
hereto signed on behalf of Company and Microsoft by their duly-authorized
representatives.
IN
WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed as of the dates
indicated below.
|
MICROSOFT
CORPORATION
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|
QMOTIONS,
INC.
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|
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By
(signature)
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By
(signature)
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Name
(print)
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Name
(print)
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Title
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Title
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Date
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Date
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Page
17 of 28
CONFIDENTIAL
TREATMENT REQUESTED
WITH
RESPECT TO CERTAIN PORTIONS HEREOF
DENOTED
WITH “***”
EXHIBIT
A
Microsoft
Materials
Technical
Documentation:
|
1.
|
Xbox
360 Controller Requirements
|
|
2.
|
Xbox
360 Wireless Controller
Requirements
|
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3.
|
Xbox
360 Controller XUSB Specification
|
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4.
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Xbox
360 Controller Certification
Requirements
|
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5.
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XNA
common controller WindowsXP driver [in object code
only]
|
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6.
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Xbox
360 Controller Security Interface
Specification
|
Page
18 of 28
CONFIDENTIAL
TREATMENT REQUESTED
WITH
RESPECT TO CERTAIN PORTIONS HEREOF
DENOTED
WITH “***”
EXHIBIT
B-1
Licensed
Logos
Xbox
360 Product Jewel Logo
Licensed
for Xbox 360 Logo
Page
19 of 28
CONFIDENTIAL
TREATMENT REQUESTED
WITH
RESPECT TO CERTAIN PORTIONS HEREOF
DENOTED
WITH “***”
EXHIBIT
B-2
Branding
Specifications
*******
Page
20 of 28
CONFIDENTIAL
TREATMENT REQUESTED
WITH
RESPECT TO CERTAIN PORTIONS HEREOF
DENOTED
WITH “***”
EXHIBIT
C
Royalties
and Fees
1.
Xbox
360 Logo Royalties.
a.
Logo
Royalties.
In
accordance with Section 5.2(a), Company will pay the Xbox 360 Logo Royalties
set
forth in the table below for units of Licensed Product sold in the applicable
territory.
b. One-Time
Guaranteed Royalty Payment.
Company
will make a one-time guaranteed royalty payment for each applicable Territory
below (the “Guaranteed
Royalty”).
The
Guaranteed Royalty Payment will be due within thirty (30) days after the
Effective Date. The Guaranteed Royalty is not refundable except as set forth
in
Section 15.2, but will be applied as a credit against the royalties payable
under Section 5.2(a) on Licensed Products that Company ships to customers
during
the Guaranteed Royalty Period set forth in the table below. The Guaranteed
Royalty will not be applied to any royalties payable on Licensed Products
that
Company ships to customers after the expiration of the Guaranteed Royalty
Period.
|
Territory
|
Royalty
Rate
|
Guaranteed
Royalty
|
Guaranteed
Royalty Period
|
|
*******
|
Wired
Licensed Products:
*******
Wireless
Licensed Products:
*******
|
US$*******
|
*******
|
|
*******
|
Wired
Licensed Products:
*******
price
for the Licensed Product*
Wireless
Licensed Products:
*******
price
for the Licensed Product
|
US$*******
|
*******
|
|
*******
|
Wired
Licensed Products:
*******
Wireless
Licensed Products:
*******
|
US$*******
|
*******
|
Fee
Waiver for Bundles.
Company
is not required to pay
the Xbox
360 Logo Royalties (including the Guaranteed Royalty) set forth in this Section
1 for Products that are sold as part of a Bundle.“Bundle”
means a Licensed Product when packaged and sold with a licensed Xbox 360
software game product designed for use with the Licensed Product.
2. Security
Feature Fee. Company
will pay Microsoft a license fee in the amount of US***
per
Security Chip that is purchased by Company. Company must pay the Security
Feature Fee for each Security Chip purchased by Company on a quarterly basis
at
the same time Company submits the royalty report and payment required in
Section
5.2(b).
3. Wireless
Feature Fee. Company
will pay Microsoft a license fee in the amount of US***
per
Radio
Device that is purchased by Company. Company must pay the Wireless Feature
Fee
each Radio Device purchased by Company on a quarterly basis at the same time
Company submits the royalty report and payment required in Section 5.2(b).
By
way of clarification, Company may only purchase Radio Devices for use in
(a)
Proposed Products that Microsoft has approved pursuant to Section 6.1 and
(b)
Licensed Products directly resulting from such Proposed Products.
4. Setup
and Firmware Fees.
| a. |
Setup
Fee.
Company will pay Microsoft a one-time setup fee in the amount of
US$***
in
consideration of Microsoft and its Approved Vendor establishing
a
Company-specific version of the Security Chip for Company’s use. Microsoft
will waive this fee, however, if Company either: (i) elects to
license the
Baseband Firmware and pays the Baseband Firmware fee identified
in Section
4(b) below; or (ii) intends to develop a Wireless Licensed Product
and
pays the Wireless Firmware fee identified in Section 4(c)
below.
|
Page
21 of 28
CONFIDENTIAL
TREATMENT REQUESTED
WITH
RESPECT TO CERTAIN PORTIONS HEREOF
DENOTED
WITH “***”
| b. |
Baseband
Firmware Fee.
If Company elects to license the Baseband Firmware, Company will
pay
Microsoft a one-time non-refundable fee in the amount of US***.
Microsoft will waive this fee, however, if Company intends to develop
a
Wireless Licensed Product and pays the Wireless Firmware fee identified
in
Section 4(c) below.
|
| c. |
Wireless
Firmware Fee.
If Company plans to create a Proposed Product intended to result
in a
Wireless Licensed Product, Company will pay Microsoft a one-time
non-refundable fee in the amount of US***.
Company will pay this fee within ***
days
after Microsoft’s approval of the Company’s plan for the Proposed Product
pursuant to Section 6.1
|
Page
22 of 28
CONFIDENTIAL
TREATMENT REQUESTED
WITH
RESPECT TO CERTAIN PORTIONS HEREOF
DENOTED
WITH “***”
EXHIBIT
D
Certification
Testing Centers
[To
be supplied at a later date]
Page
23 of 28
CONFIDENTIAL
TREATMENT REQUESTED
WITH
RESPECT TO CERTAIN PORTIONS HEREOF
DENOTED
WITH “***”
EXHIBIT
E
Territory
Check
all
that apply:
|
|
x |
North
America
|
| o |
Japan
|
|
| o |
Europe
and Rest of World
|
Page
24 of 28
CONFIDENTIAL
TREATMENT REQUESTED
WITH
RESPECT TO CERTAIN PORTIONS HEREOF
DENOTED
WITH “***”
EXHIBIT
F
Approved
Vendors
|
Infineon
P/N
|
Approved
Vendor
|
Contact
|
Licensee’s
Orders to be Placed By
|
|
***
|
Qmotions,
Inc.
|
Xxxx
Xxxxxxxx
Qmotions,
Inc.
000
Xxxxxxxxxxx Xxx. #000, Xxxxxxxxx, XX 00000
Phone:
x0-000-000-0000
Xxxxx
Xxxxxxxxx
Qmotions,
Inc.
000
Xxxxxxxxxxx Xxx. #000, Xxxxxxxxx, XX 00000
Phone:
x0-000-000-0000 X000
|
Qmotions,
Inc. will handle all security chip orders for this part
number.
|
Page
25 of 28
CONFIDENTIAL
TREATMENT REQUESTED
WITH
RESPECT TO CERTAIN PORTIONS HEREOF
DENOTED
WITH “***”
EXHIBIT
G
Certificate
of Compliance (CoC)
Supplier
Information
|
Company
Name:
|
Address:
|
|
SRSM
(Supplier Restricted Substance Mngr) :
|
Title:
|
|
SRSM
Phone:
|
Email:
|
Reportable
Substances
Use
the
following section to disclose all Section B substances listed in Microsoft
Specification Restricted Substances for Hardware Products
(H00594).
If
Section B substances are used in the product or component, specify the chemical
name, Chemical Abstracts Service (CAS) number, and where the substance is
used
in the product or component.
If
none
of the above substances are present, specify “NOT USED” on line 1 below. Use
additional sheet if necessary.
|
H00594
Section B SUBSTANCE NAME
|
CAS
NUMBER
|
WHERE
USED in PRODUCT
|
|
1.
|
|
|
|
2.
|
|
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3.
|
|
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4.
|
|
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5.
|
|
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6.
|
|
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Product
Information
|
Product
Names & Number:
|
Device (ex.
Gamepad, Steering wheel):
|
|
PNs
/ EIPNs / SKUs:
|
Time
Period (maximum
12 months):
From:
To:
|
|
Does
this component contain a RoHS exempt application? No:o
Yes:
o
If
yes:
Refer
to Annex 1 at the end of this form for the complete list of RoHS
exemptions.
2. Identify
the homogeneous
material(s)
in
the component(s) containing the RoHS substance (e.g. glass, metal,
alloy,
ceramic, etc.):
|
I
certify
that the supplied product (see above) conforms fully to the requirements
of the
Microsoft “Restricted
Substances for Hardware Products (H00594)”
specification and that no banned Ozone Depleting Chemicals (per the Montreal
Protocol) are used in the manufacture of Microsoft products.
Supplier
Electronic Signature
|
SRSM:
|
Date:
|
Page
26 of 28
Annex
1: Applications of lead, mercury, cadmium and hexavalent
chromium
exempted from RoHS as of October 2006
The
following is a list of exemptions under RoHS which MS suppliers may find
relevant. Suppliers are responsible for maintaining current information and
are
encouraged to consult the full text of RoHS for other exemptions and for
the
latest updates to RoHS.
|
1.
|
Mercury
in compact fluorescent lamps not exceeding 5 mg per
lamp.
|
|
2.
|
Mercury
in straight fluorescent lamps for general purposes not exceeding:—
halophosphate 10 mg; — triphosphate with normal lifetime 5 mg; —
triphosphate with long lifetime 8
mg.
|
|
3.
|
Mercury
in straight fluorescent lamps for special
purposes.
|
|
4.
|
Mercury
in other lamps not specifically mentioned in this
Annex.
|
|
5.
|
Lead
in glass of cathode ray tubes, electronic components and fluorescent
tubes.
|
| 6. |
a.
|
Lead
as an alloying element in steel containing up to 0.35 % lead by
weight
|
|
b.
|
Lead
as an alloying element in aluminum containing up to 0.4 % lead
by
weight
|
|
c.
|
Lead
as an alloying element copper alloys containing up to 4 % lead
by
weight.
|
| 7. |
a.
|
Lead
in high melting temperature type solders (i.e. lead based alloys
containing 85 % by weight or more
lead)
|
|
b.
|
Lead
in solders for servers, storage and storage array systems, network
infrastructure equipment for switching, signaling, transmission
as well as
network management for
telecommunications
|
|
c.
|
Lead
in electronic ceramic parts (e.g. piezoelectronic
devices).
|
|
8.
|
Cadmium
in electrical contacts and cadmium plating except for applications
banned
under Directive 91/338/EEC (1) amending Directive 76/769/EEC (2)
relating
to restrictions on the marketing and use of certain dangerous substances
and preparations.
|
|
9.
|
Hexavalent
chromium as an anti-corrosion of the carbon steel cooling system
in
absorption refrigerators.
|
| 10. |
Not
Applicable per H00594. Deca BDE is banned in Microsoft
products.
|
| 11. |
Lead
used in compliant pin connector
systems.
|
| 12. |
Lead
as a coating material for the thermal conduction module
c-ring.
|
| 13. |
Lead
and cadmium in optical and filter
glass.
|
| 14. |
Lead
in solders consisting of more than two elements for the connection
between
the pins and the package of microprocessors with a lead content
of more
than 80% and less than 85% by
weight.
|
| 15. |
Lead
in solders to complete a viable electrical connection between
semiconductor die and carrier within integrated circuit Flip Chip
packages.
|
| 16. |
Lead
in linear incandescent lamps with silicate coated
tubes.
|
| 17. |
Lead
halide as radiant agent in High Density Discharge (HID) lamps used
for
professional reprography
applications.
|
| 18. |
Lead
as activator in the fluorescent powder (1 % lead by weight or less)
of
discharge lamps when used as sun tanning lamps containing phosphors
such
as BSP (BaSi2O5:Pb) as well as when used as speciality lamps for
diazo-printing reprography, lithography, insect traps, photochemical
and
curing processes containing phosphors such as SMS
((Sr,Ba)2MgSi2O7:Pb).
|
| 19. |
Lead
with PbBiSn-Hg and PbInSn-Hg in specific compositions as main amalgam
and
with PbSn-Hg as auxiliary amalgam in very compact Energy Saving
Lamps
(ESL).
|
|
21.
|
Lead
oxide in glass used for bonding front and rear substrates of flat
fluorescent lamps used for Liquid Crystal Displays (LCD).Lead and
cadmium
in printing inks for the application enamels on borosilicate
glass
|
| 22. |
Lead
in finishes of fine pitch components other than connectors with
a pitch of
0.65mm or less with Ni Fe lead frames and lead in finishes of fine
pitch
components other than connectors with a pitch of 0.65mm or less
with
copper lead-frames
|
| 23. |
Lead
in solders for the soldering to machined through hole discoidal
and planar
array ceramic multilayer capacitors
|
| 24. |
Lead
oxide in plasma display panels (PDP) and surface conduction electron
emitter displays (SED) used in structural elements; notably in
the front
and rear glass dielectric layer, the bus electrode, the black stripe,
the
address electrode, the barrier ribs, the seal frit and frit ring
as well
as in print pastes
|
| 25. |
Lead
oxide in the glass envelope of Black Light Blue (BLB)
lamps
|
| 26. |
Lead
alloys as solder for transducers used in high-powered (designated
to
operate for several hours at acoustic power levels of 125dB SPL
and above)
loudspeakers
|
| 27. |
Hexavalent
chromium in corrosive preventive coatings of unpainted metal sheetings
and
fasteners used for corrosion protection and Electromagnetic Interference
Shielding in equipment falling under category three of Directive
2002/96/EC (IT and telecommunications equipment). Exemption granted
until
1 July 2007
|
| 28. |
Lead
bound in xxxxxxx xxxxx as defined in Annex I (Categories 1, 2,
3, and 4)
of Council Directive 69/493/EEC OJ L 326, 29.12.1969, p. 36. Directive
as
last amended by 2003 Act of
Accession
|
Page
27 of 28
EXHIBIT
H
Approved
Subcontractors
|
Subcontractor
|
Contact
Information
|
|
XXX
|
XXX
|
Page
28 of 28
