EXHIBIT 10.25
CONFIDENTIAL
LICENSE AGREEMENT
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This License Agreement (the "Agreement") is entered into this 23 day of
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December, 1999 (the "Effective Date"), by and between Seiko Instruments, Inc., a
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corporation duly authorized and existing under the laws of Japan with principal
offices at 8, Nakase 1-chome, Mihama-ku Xxxxx-xxx Xxxxx 000-0000, Xxxxx ("SII")
and Numerical Technologies Inc., a California corporation with offices at 00
Xxxx Xxxxxxxx Xxxxx, Xxx Xxxx, XX 00000-0000 ("NTI").
RECITAL
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WHEREAS, SII develops and markets custom design tools for VLSI layout
and design and NTI develops and markets software design tools for subwavelength
integrated circuit technologies. SII desires to distribute certain of its
products in conjunction with certain of NTI's software design tool modules for
subwavelength integrated circuit technologies subject to the terms and
conditions of this Agreement.
In consideration of the foregoing and the mutual promises contained
herein. SII and NTI agree as follows:
1. DEFINITIONS.
1.1 "Bundled Product" shall mean the SII Combined Products
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bundled with and licensed under the same SKU as ModelCalibrator.
1.2 "Check-It" shall mean that software (in the form of binary
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application) marketed under the name "Check-It Version 3.1" which acts as the
layout verification software that uses NTI's lithography simulation to locate
and flag areas of an integrated circuit layout design that product projected
wafer patterns outside of specified tolerance, and any Updates thereto.
1.3 "Derivative Work" shall mean a derivative work within the
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meaning of the U.S. copyright law.
1.4 "Documentation" shall mean the manuals and other
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documentation that NTI generally makes available with the NTI Products, Check-It
and ModelCalibrator to End Users licensed users of such products.
1.5 "End User" shall mean an end user who obtains a copy of
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the SII Combined Products and/or Bundled Product and associated Keys from SII
solely in order to fulfill such end users own internal operations and not for
further distribution subject to the terms of an End User Agreement.
1.6 "End User Agreement" shall mean an agreement or agreements
which is/are mutually acceptable to the parties in accordance with Section 2.4.
Numerical Technologies, Inc. - Seiko Instruments, Inc.
[***]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
1.7 "Error" shall mean a substantial nonconformity of the NTI
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Products, Check-It or ModelCalibrator with the Documentation.
1.8 "Floating License" shall mean an End User Agreement which
authorizes an End User to use the licensed product, on different computers, so
long as the licensed product is not used simultaneously on two computers.
1.9 "Fiscal Year" shall mean a year which commences on April 1 and
ends on March 31 of the following calendar year.
1.10 "Integration Software" shall mean software that integrates NTI
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Products with the SII Product
1.11 "Intellectual Property Rights" shall mean (by whatever
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name or term known or designated) copyrights, trade secrets, patents or any
other intellectual and industrial property and proprietary rights (excluding
trademarks) including registrations, applications, renewals and extensions of
such rights.
1.12 "Keys" shall mean the software files supplied to SII by
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NTI which enable the NTI Products, Check-It and ModelCalibrator to be accessed
by an End User. A Key is required for use of the NTI Products, Check-It and
ModelCalibrator in order to operate such products in a non-demonstration mode.
1.13 "ModelCalibrator" shall mean that software (in the form of a
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binary application) marketed under the name "ModelCalibrator Version 2.1"
which functionality includes the input of results of test-chip measurements and
creation of the optical/lithography process models used by NTI tools and
components, and any Updates thereto.
1.14 "NTI Products" shall mean the NTI software products (in the form
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of binary application) listed in Exhibit A attached hereto in machine
executable object code format, and any Updates thereto. "NTI Products" does not
include Check-It or ModelCalibrator.
1.15 "Price List" shall mean the price set forth on the official list
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of prices which a party publishes for disclosure to customers and prospective
customers. SII List Price means the price for a designated product on a Price
List published by SII. NTI U.S. List Price means the price for a designated
product on a Price List published by NTI for customers located in the United
States only and not in any other location worldwide
1.16 "SII Combined Products" shall mean the SII software products that
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are comprised of the SII Product and the NTI Products.
1.17 "SII Product" shall mean software product listed in Exhibit B
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attached hereto in machine executable object code format, and all Updates
thereto.
Numerical Technologies, Inc. - Seiko Instruments, Inc. 2
1.18 "SKU" shall mean the stock keeping unit number or other unique
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product number that is used to identify a particular product.
1.19 "Updates" shall mean bug fixes and reasonable enhancements to the
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NTI Products, Check-It and ModelCalibrator that NTI generally makes available to
its End Users free of charge, but excluding new versions of the NTI Products,
Check-It and ModelCalibrator that contain significant new features or
functionality, as determined by NTI in its sole discretion.
2. LICENSE GRANTS
2.1 Software License to SII. Subject to the limitations set forth in
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Section 2.2 below and the other terms and conditions of this Agreement, NTI
hereby grants to SII:
(i) non-exclusive, nontransferable, worldwide, limited license
under NTI's Intellectual Property Rights in the NTI Products, Check-It and
ModelCalibrator to use, reproduce, perform and display the NTI Products, Check-
It and ModelCalibrator (in object code form only) for SII's internal purposes
only including integration work, testing, support, and demonstrations;
(ii) a non-exclusive, nontransferable, worldwide, limited
license under NTI's Intellectual Property Rights in the NTI Products: (1) to
copy the NTI Products and to distribute as NTI Products as incorporated into the
SII Combined Product (and not on a standalone basis) and associated Keys to End
Users, and (2) to use the NTI Products solely for the support thereof pursuant
to the provisions of Section 5;
(iii) a non-exclusive, nontransferable, worldwide, limited
license under NTI's Intellectual Property Rights in Check-It and
ModelCalibrator: (1) to copy Check-It and ModelCalibrator, and to distribute
Check-It and ModelCalibrator as incorporated with the Bundled Product (and not
on a standalone basis) and associated Keys to End Users, and (2) to use Check-It
and ModelCalibrator solely for the support thereof pursuant to the provisions of
Section 5;
(iv) a non-exclusive, nontransferable, worldwide, limited
license under NTI's Intellectual Property Rights in Check-It: (1) to copy Check-
It and to Distribute Check-It (on a standalone basis) and associated Keys to End
Users, and (2) to use Check-It solely for the support thereof pursuant to the
provisions of Section 5; and
(v) a non-exclusive, nontransferable, worldwide limited license
under NTI's Intellectual Property Rights in the Documentation to copy and
distribute the Documentation to End Users in conjunction with the authorized
distribution of the SII Combined Products and Bundled Product.
SII may not, and may not authorize any third party to, distribute the NTI
Products, Check-It or ModelCalibrator or the Documentation on a stand-alone
basis
Numerical Technologies, Inc. - Seiko Instruments, Inc. 3
(except as permitted in Section 2.1(iv) above), without the express written
consent of NTI. SII may not authorize a third party to distribute the NTI
Products, Check-It or ModelCalibrator without the prior written permission of
NTI. SII may not sublicense its rights hereunder except to the extent expressly
permitted under Section 2.4 below.
2.2 Restrictions on License. SII shall not itself, or through any
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subsidiary, affiliate, agent or third party: (a) sell, lease, license or
sublicense the NTI Products, Check-It or ModelCalibrator or the Documentation
(except as expressly permitted in Section 2.1), (b) decompile, disassemble,
reverse engineer or otherwise attempt to derive source code from the NTI
Products, Check-It or ModelCalibrator, in whole or in part, except to the extent
such restriction is prohibited by applicable law; (c) write or develop any
Derivative Works of the NTI Products, Check-It or ModelCalibrator or any other
software program based upon the NTI Products Check-It or ModelCalibrator; or (d)
use the NTI Products, Check-It or ModelCalibrator to provide processing services
to third parties, or otherwise use the NTI Products, Check-It or ModelCalibrator
on a service bureau basis.
2.3 Master Copies. Promptly after the Effective Date, NTI will
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provide SII with one (1) copy of the NTI Products, Check-It and ModelCalibrator
and the Documentation as they exist on such date, in a mutually agreed upon
electronic form. SII will have thirty (30) days from the respective dates of
receipt by SII of such copies to notify NTI in writing of its acceptance
thereof, or to provide a written statement of any Errors to be corrected.
Failure of SII to notify NTI of any such Errors within such ten (10) day period
shall be deemed acceptance by SII. If SII provides a written statement of
Errors, NTI shall correct all Errors and deliver the correct NTI Products,
Check-It, ModelCalibrator or Documentation to SII within a reasonable timeframe.
2.4 End User License Terms. SII shall distribute the NTI Products.
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Check-It and ModelCalibrator to End Users under standard SII form license which
incorporates certain terms to be mutually agreed upon by the parties. Such terms
shall include, but are not limited to, a prohibition on the assignment of the
End User License, a warranty disclaimer and limitation of liability provisions
for the benefit of NTI and restrictions similar to those in Section 2.2 above.
It is understood that the NTI Products, Check-It and ModelCalibrator are
licensed on a per CPU basis, and use of the NTI Products, Check-It and
ModelCalibrator by the End User requires installation and use of a Key with
respect to each CPU from which the NTI Products, Check-It and ModelCalibrator
are accessed. Keys shall be supplied by NTI to SII as provided under Section
3.7.
2.5 Trademark License to SII. SII shall display NTI's trademarks
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and logos with the SII Combined Products, Bundled Product and the Documentation
and any other marketing, promotional or advertising literature pertaining to the
SII Combined Products and Bundled Product. NTI grants to SII a nonexclusive,
worldwide license to use the NTI trade names, trademarks and logos set forth in
Exhibit C ("NTI's Trademarks") attached hereto during the term of this Agreement
solely in connection with the authorized distribution of SII Combined Products
and SII Bundled Products, and with
Numerical Technologies, Inc. - Seiko Instruments, Inc. 4
the authorized distribution of the Documentation. SII shall fully comply with
any and all guidelines provided by NTI concerning the use of NTI's Trademarks.
NTI's Trademarks shall be at least the same size as all other trademarks, trade
names and logos displayed on the SII Combined Products and Bundled Products and
no less prominent. All representations of NTI's Trademarks that SII intends to
use shall be submitted to NTI by SII for approval of design, color and other
details or shall be exact copies of those used by NTI. To enable NTI to monitor
the use of NTI's Trademarks, SII shall provide, as requested by NTI from time to
time, samples of all items and materials to which a NTI Trademark has been
applied. SII shall obtain no rights with respect to any of NTI's Trademarks,
other than the rights set forth herein. At NTI's written request, SII shall
assign to NTI any such right, title and interest exceeding the rights granted
herein that it may obtain in NTI's Trademarks and the associated goodwill. All
goodwill arising out of any uses of NTI's Trademarks will inure solely to the
benefit of NTI. NTI reserves the right to modify or replace the NTI Trademarks
("Updated NTI Trademarks") in its sole discretion. Upon ten (10) days prior
written notice to SII of Updated NTI Trademarks, SII shall replace the NTI
trademarks with the Updated NTI Trademark, and the Updated NTI Trademark shall
be subject to this Section 2.5.
2.6 No Other Rights. Except as expressly provided in this Section
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2, NTI does not grant to SII any right, title or interest in the NTI Products,
Check-It, ModelCalibrator or the Documentation, whether by implication, estoppel
or otherwise. All rights not specifically granted herein are reserved to NTI
including without limitation the right to modify or otherwise create Derivative
Works of the NTI Products, Check-It. ModelCalibrator and the Documentation.
Without limiting the foregoing, NTI retains the right to distribute NTI
Products, Check-It, ModelCalibrator and the Documentation, directly or
indirectly, for any and all uses.
2.7 Copyright Notices. SII shall not (and shall require that End
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Users do not) remove, alter, cover or obfuscate any copyright notices or other
proprietary rights notices placed on or embedded in the NTI Products, Check-It,
ModelCalibrator or Documentation by NTI. All titles, trademark symbols,
copyright symbols and legends and other proprietary markings must be reproduced.
Upon NTI's request, SII shall furnish evidence of its compliance with the
provisions of this Section 2.
3. DISTRIBUTION AND FEES
3.1 Development Fees. In consideration of NTI's development of the
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NTI Products, SII shall pay NTI development fees equal to the amounts set forth
in Exhibit D (the "Development Fees") according to the schedule set forth on
Exhibit D.
3.2 License Fees. In consideration of the rights granted hereunder,
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for distribution of the NTI Products, Check-It, ModelCalibrator and for each Key
shipped by NTI to SII hereunder, SII shall pay to NTI the license fees set forth
in Exhibit E (the "License Fee"). The difference between the License Fee and the
fees charged by SII for the NTI Products shall be SII's sole remuneration for
the distribution of the NTI Products. SII is responsible for establishing the
fees charged to End Users.
Numerical Technologies, Inc. - Seiko Instruments, Inc. 5
3.3 Minimum License Fees. During the term of this Agreement, the
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parties agree that NTI shall receive a minimum license fee set forth in Exhibit
E for SII's distribution the NTI Products, Check-It and Model Calibrator
hereunder. In addition, during the term of this Agreement, SII shall be
obligated to make an annual commitment of License Fees that it shall pay to NTI
under this Agreement ("Annual Minimum License Fees"). Prior to the beginning of
a Fiscal Year, SII and NTI shall agree in writing upon the Annual Minimum
License Fee SII pay to NTI in such upcoming Fiscal Year.
3.4 Maintenance Fees. In consideration of the rights granted
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hereunder, in consideration for support of the NTI Products, Check-It and Model
Calibrator provided under Section 6 hereunder, SII shall pay to NTI the
maintenance fees set forth in Exhibit F (the "Maintenance Fees") on an annual
basis.
3.5 Invoicing. NTI shall submit an invoice for License Fees and
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Maintenance Fees to SII upon shipment of Keys ordered by SII. All invoices shall
be sent to SII's address for notices hereunder, without regard to the actual
shipping address. Each such invoice shall state SII's aggregate and unit License
Fees payable with respect to a given shipment of Keys, plus any freight, taxes
or other costs incident to the purchase, license or shipment initially paid by
NTI but to be borne by SII hereunder.
3.6 Reports and Payment Terms. Unless otherwise expressly provided
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herein. SII shall make all License Fee payments due to NTI under Section 3
hereunder monthly, within forty-five (45) days of the end of each calendar
month. All payments shall be made in U.S. dollars. Within forty-five (45) days
of the end of each calendar month, SII shall also submit through an electronic
transfer of funds to an account designated by NTI and shall be accompanied by a
"Report". "Report" means a report showing, at a minimum, date licensed, quantity
of each type of NTI Product, Check-It and ModelCalibrator licensed, the End
Users' names and addresses and a statement of the amounts due NTI under Section
3. Each Report shall be deemed NTI's Confidential Information pursuant to
Section 10 herein. Any exchange rate calculations made under this Agreement
shall be made at the Yen to Dollar rate published by Fuji bank on the last day
of the calendar month preceding payment.
3.7 Assignment of Keys. Each Key shall be issued by NTI to SII for
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further distribution to End Users. Keys shall only be provided to End Users.
3.8 Audit Rights. SII agrees to maintain, until three (3) years after
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expiration of this Agreement, complete books, records and accounts relevant to
computation and accounting for License Fees and Maintenance fees under this
Agreement. SII agrees to allow an independent certified public accountant the
right to audit and examine such books, records and accounts during SII's normal
business hours no more than twice per year upon reasonable notice. In the event
such examination leads to a determination that SII underpaid NTI, SII agrees to
pay, in addition to any damages to which NTI might be entitled, the amount of
such shortfall. In addition, if any such
Numerical Technologies, Inc. - Seiko Instruments, Inc. 6
examination reveals an underpayment of five percent (5%) or more, SII shall
reimburse to NTI its costs of such examination.
3.9 Taxes. The License Fees do not include and are net of any
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foreign or domestic governmental taxes or charges of any kind that may be
applicable to the licensing, marketing or distribution of the Products. SII
shall be responsible for and shall pay all such taxes and charges levied against
NTI in a timely manner. When NTI has the legal obligation to pay or collect such
taxes, excluding taxes on the income of NTI, the appropriate amount shall be
invoiced to SII and paid by SII within thirty (30) days of the date of invoice
unless SII provides NTI with a valid tax exemption certificate authorized by the
appropriate taxing authority.
3.10 Withholding Taxes. All payments by SII shall be made free and
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clear of, and without reduction for, any withholding taxes. Any such taxes which
are otherwise imposed on payments to NTI shall be the sole responsibility of
SII. SII shall provide NTI with official receipts issued by the appropriate
taxing authority or such other evidence as is reasonably requested by NTI to
establish that such taxes have been paid.
4. SII DILIGENCE
SII shall use commercially reasonable efforts to promote and market the
SII Combined Products and Bundled Products to maximize sales of the SII Combined
Products and Bundled Products worldwide. Except as expressly set forth herein,
SII shall be solely responsible for all costs and expenses related to the
advertising, marketing, promotion, and distribution of the SII Combined Products
and Bundled Products and for performing its obligations hereunder.
5. SII SUPPORT.
5.1 SII End User Support. Except as provided in Section 6.1 below,
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SII shall be solely responsible for supporting all End Users of the SII Combined
Products, Bundled Products and Check-It distributed hereunder. SII shall ensure
that SII's technical and engineering support personnel attend any training
provided by NTI with respect to the NTI Products, Check-It and ModelCalibrator.
SII shall ensure that all End User questions regarding the use or operation of
SII Combined Products, Bundled Products and Check-It are initially addressed to
and answered by SII. NTI will provide support services directly to SII in
accordance with the provisions of Section 6.
5.2 Training of SII End Users. SII shall have the sole
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responsibility for conducting end-user training for the SII Combined Products
and Bundled Products.
6. NTI SUPPORT AND TRAINING.
6.1 Information and Support. NTI shall provide SII (and not
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End Users) with reasonable back-up telephone and electronic mail support
regarding the NTI Products, Check-It and ModelCalibrator. Such support shall be
provided with respect to
Numerical Technologies, Inc. - Seiko Instruments, Inc. 7
issues related directly to the NTI Products, Check-It and ModelCalibrator as
provided by NTI to SII hereunder, and not with respect to issues related to
interfacing, or the components of SII Combined Products or Bundled Product other
than the NTI Products, Check-It and ModelCalibrator.
6.2 Training. NTI shall provide reasonable training class to SII
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engineers and support engineers regarding the NTI Products, Check-It and
ModelCalibrator at a mutually agreed upon location. The goal of the class shall
be to enable SII engineers and support engineers to provide telephone support to
End Users for the NTI Products, Check-It and ModelCalibrator; to engage in sales
activities and respond to technical questions; and to conduct End-User training
for the NTI Products, Check-It and ModelCalibrator. NTI will quote prices for
any special training upon request.
6.3 Marketing Materials. NTI, at its expense, may periodically
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provide SII with samples of NTI's advertising and promotional materials, pricing
information and technical data related to the NTI Products. Check-It and Model
Calibrator in English, in each case to the extent NTI in its discretion makes
such materials generally available to its value-added resellers other than SII;
provided that SII shall pay the freight costs and other taxes and duties
applicable to any such items provided or the delivery thereof. SII shall not
modify the materials described in this Section 6.3 without NTI's prior written
approval.
6.4 Updates. During the term of this Agreement, NTI shall promptly
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deliver to SII any Updates to the NTI Products, Check-It and ModelCalibrator
that NTI has prepared upon commercial release thereof.
6.5 Back-Up Support and Error Corrections. During the term of this
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Agreement, NTI shall provide to SII reasonable back-up support for the NTI
Products, Check-It and ModelCalibrator which shall consist of reasonable
commercial efforts to correct Errors in NTI Products, Check-It and Model
Calibrator based upon NTI's standard priority bug fix and support policies.
Without limiting the foregoing, SII shall (w) provide sufficient information to
NTI for NTI to duplicate any reported Error in the NTI Products, Check-It or
ModelCalibrator; (x) incorporate Updates into the SII Combined Products and
Bundled Products promptly upon receipt thereof and distribute Updates to then-
existing End Users; (y) report Errors promptly in English and in writing in
accordance with NTI's standard support procedures; and (z) provide reasonable
cooperation and full information to NTI in the furnishing of support for the NTI
Products, Check-It and ModelCalibrator.
7. PROPRIETARY RIGHTS.
7.1 SII Product. The parties agree that, as between the parties, SII
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retains all right, title and interest in and to the SII Product and in all
Intellectual Property Rights therein. Nothing herein shall grant to NTI any
rights that SII may own in the software developed by SII to interface with the
NTI Products, Check-It and ModelCalibrator.
Numerical Technologies, Inc. - Seiko Instruments, Inc. 8
7.2 NTI Products. The parties agree that, as between the parties,
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NTI retains all right, title and interest in and to the NTI Products, Check-It
and ModelCalibrator and in all Intellectual Property Rights therein.
8. LIMITED WARRANTIES AND DISCLAIMER.
8.1 Limited Warranty. NTI warrants that, at the time of delivery of
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the Key to SII, the unmodified NTI Products, Check-It and ModelCalibrator will
be complete and functioning and that, for a period of ninety (90) days from the
date of receipt by an End User as evidenced in the End User License, and that
the NTI Products, Check-It and ModelCalibrator, under normal use, will perform
substantially in accordance with the Documentation.
8.2 Limitations. The warranties under Section 8.1 will not extend
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to problems that result from: (i) SII's failure to implement all Updates to the
NTI Products, Check-It or ModelCalibrator issued to SII by NTI; (ii) any
alterations of or additions to the NTI Products, Check-It or ModelCalibrator
performed by parties other than NTI; (iii) use of the NTI Products, Check-It or
ModelCalibrator in a manner for which it was not designed; or (iv) use of the
NTI Products, Check-It or ModelCalibrator in conjunction with products not
supplied or approved by NTI.
8.3 Exclusive Remedy. NTI's entire liability and SII's exclusive
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remedy under this warranty will be, at NTI's option, to use reasonable
commercial efforts to attempt to correct or work around Errors or to replace the
NTI Products, Check-It and ModelCalibrator with functionally equivalent NTI
Products Check-It and ModelCalibrator.
8.4 Disclaimer of Warranties. Except as expressly stated in Section
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8.1 above, NTI MAKES NO OTHER WARRANTIES OR CONDITIONS OF ANY KIND, WHETHER
EXPRESS, IMPLIED OR, STATUTORY OR OTHERWISE AND NTI SPECIFICALLY DISCLAIMS ANY
AND ALL IMPLIED WARRANTIES OF MERCHANTABILITY, NON-INFRINGEMENT AND FITNESS FOR
A PARTICULAR PURPOSE. NOTWITHSTANDING THE FOREGOING, NTI DOES NOT EXCLUDE
LIABILITY TO THE EXTENT THAT SUCH LIABILITY MAY NOT BE EXCLUDED OR LIMITED BY
APPLICABLE LAW.
8.5 SII Restrictions. Except to the extent required by applicable
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law, SII shall not pass on to its End Users a warranty of greater scope or
protection than the warranty (including the limited remedy, exclusions, and
limitation of liability) set forth in this Section 8 and Section 9.3 below. SII
shall indemnify, defend and hold harmless NTI from any claim or liability
arising out of or relative to breach of this Section 8.5 or representations or
warranties which exceed NTI's express warranties set forth in this Section 8 or
the limitations of liability set forth in Section 11.3.
Numerical Technologies, Inc. - Seiko Instruments, Inc. 9
9. INDEMNIFICATION AND LIMITATION OF LIABILITY.
9.1 Indemnification by NTI. NTI agrees, at its own expense, to
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defend or at its option settle, any third party claim, suit or proceeding
(collectively, "Action") brought against SII to the extent such Action results
from infringement by the NTI Products ModelCalibrator and Check-It of any U.S.
patent or U.S. copyright or trademark worldwide and NTI agrees to pay, subject
to the limitations hereinafter set forth, any settlement amounts or final
judgment entered against SII on such issue in any such Action defended and/or
settled by NTI. SII agrees that NTI will be relieved of the foregoing
obligations unless SII (i) notifies NTI promptly in writing of such an Action,
(ii) gives NTI sole control and authority over any such Action or settlement
negotiations, and (iii) gives NTI proper and full information and assistance to
settle and/or defend any such Action. If it is adjudicatively determined, or if
NTI believes that the NTI Products, Check-It or ModelCalibrator or any part
thereof, infringe any U.S. patent, copyright or trademark, or if the sale or use
of the NTI Products, Check-It or ModelCalibrator is, as a result, enjoined, then
NTI may, at its election, option, and expense: (a) procure for SII the right
under such patent, copyright or trademark to sell or use, as appropriate, the
NTI Products, Check-It or ModelCalibrator, or such part thereof; or (b) replace
the NTI Products, Check-It or ModelCalibrator, or parts thereof, with
noninfringing suitable NTI products or parts; or (c) suitably modify the NTI
Products, Check-It or ModelCalibrator, or part thereof, to become noninfringing;
or (d) remove the NTI Products. Check-It or ModelCalibrator, or part thereof,
terminate distribution or sale thereof and refund the last four months payments
of License Fees made by SII for such NTI Products. Check-It or ModelCalibrator.
(a) The remedy set forth in this Section 9.1 shall not apply to
the extent that such infringement arises from (a) use of a NTI Products. Check-
It or ModelCalibrator in a manner which is not provided for in the Documentation
or training; (b) use of a NTI Products, Check-It or ModelCalibrator in a
combination or process where the use of a NTI Products, Check-It or
ModelCalibrator used alone or not in that process would not have infringed such
rights; (c) use of other than a current unaltered release of NTI Products,
Check-It or ModelCalibrator to the extent that the infringement would have been
avoided by such current unaltered release; (d) modification of, or in the use of
NTI Products, Check-It or ModelCalibrator by, or requested by, SII or an End
User; or (e) continued infringement by SII if NTI is providing a remedy under
9.1(b) below; or (f) a breach of this Agreement by SII.
(b) NTI will not be liable for any costs or expenses incurred
without its prior written authorization, or for any installation costs of
replaced NTI products. This Section 9.1 states the sole liability of NTI and the
exclusive remedy of SII and End Users with respect to any claim of infringement.
9.2 Indemnification by SII. SII agrees, at its own expense, to
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defend or at its option settle, any third party claim, suit or proceeding
(collectively, "Action") brought against NTI to the extent such Action results
from infringement of intellectual property rights as a result of or
misrepresentations regarding the SII Combined Products
Numerical Technologies, Inc. - Seiko Instruments, Inc. 10
or the Bundled Products not covered under Section 9.1. subject to the
limitations hereinafter set forth, any settlement amounts or final judgment
entered against NTI on such issue in any such Action defended and/or settled by
SII. NTI agrees that SII will be relieved of the foregoing obligations unless
NTI (i) notifies SII promptly in writing of such an Action, (ii) gives SII sole
control and authority over any such Action or settlement negotiations, and (iii)
gives SII proper and full information and assistance to settle and/or defend any
such Action. SII will not be liable for any costs or expenses incurred without
its prior written authorization.
9.3 Limitation of Liability. EXCEPT WITH RESPECT TO BREACH OF
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SECTION 10 (CONFIDENTIALITY), LIABILITY UNDER SECTION 8.5 (INDEMNIFICATION) AND
LIABILITY TO THIRD PARTIES UNDER SECTION 9 (INDEMNIFICATION), NEITHER PARTY
SHALL HAVE ANY LIABILITY TO THE OTHER PARTY FOR LOST PROFITS OR BUSINESS
OPPORTUNITIES, LOST DATA, OR ANY OTHER INDIRECT, INCIDENTAL, CONSEQUENTIAL,
SPECIAL, OR RELIANCE DAMAGES, HOWEVER CAUSED AND UNDER ANY THEORY OF LIABILITY.
WHETHER BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE), PRODUCT LIABILITY OR
OTHERWISE. THESE LIMITATIONS SHALL APPLY REGARDLESS OF WHETHER SUCH PARTY HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGE AND NOTWITHSTANDING THE FAILURE
OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.
10. CONFIDENTIALITY.
10.1 Definition. The term "Confidential Information" shall mean any
----------
information disclosed by one party to the other party in connection with this
Agreement which if disclosed in writing or electronically is designated
"Confidential", or if disclosed orally or by inspection is designated
confidential at the time of such disclosure or which a party knows or should
have reason to know is treated as confidential by the other party.
10.2 Obligation. Each party shall treat as confidential all
----------
Confidential Information received from the other party, shall not use such
Confidential Information except as expressly permitted under this Agreement, and
shall not disclose such Confidential Information to any third party without the
other party's prior written consent. Each party shall take reasonable measure to
prevent the disclosure and unauthorized use of Confidential Information of the
other party for a period from the time of disclosure until the later to occur of
(i) the date five (5) years after such disclosure, or (ii) the expiration or
termination of this Agreement.
10.3 Exceptions. Notwithstanding the above, the restrictions of this
----------
Section 10 shall not apply to information that:
(a) a receiving party can demonstrate was independently
developed by the receiving party without any use of the Confidential Information
of the other party and by employees or other agents of (or independent
contractors hired by) the
Numerical Technologies, Inc. - Seiko Instruments, Inc. 11
receiving party who have not been exposed to the Confidential Information as
demonstrated by written documentation;
(b) becomes known to the receiving party, without restriction,
from a third party without breach of this Agreement and who had a right to
disclose it;
(c) was in the public domain at the time it was disclosed or
becomes in the public domain through no act or omission of the receiving party;
or
(d) a receiving party can demonstrate was rightfully and
previously known to the receiving party, without restriction, at the time of
disclosure.
10.4 Government Order. If a receiving party is required under an
----------------
order or requirement of a court, administrative agency, or other governmental
body to disclose any Confidential Information, then such receiving party shall
provide prompt notice thereof to the disclosing party and shall use its
reasonable commercial efforts to obtain a protective order or otherwise prevent
public disclosure of such information.
11. TERM AND TERMINATION.
11.1 Term. The term of this Agreement shall commence on the
----
Effective Date and shall continue in full force and effect for a term of three
(3) years from the Effective Date unless terminated earlier as provided under
Section 11.2 or 11.3. Thereafter, this Agreement shall be automatically renewed
for additional one (1) year terms upon mutual agreement on pricing, unless
either party notifies the other party in writing of its intention not to renew
the Agreement for an additional term at least sixty (60) days prior to the
expiration of the then-current term.
11.2 Right to Terminate for Breach. If either party materially
-----------------------------
breaches any term or condition of this Agreement and fails to cure that breach
within sixty (60) days after receiving written notice of the breach, the non-
breaching party may terminate this Agreement at any time within thirty (30) days
following the end of such sixty (60) day period; provided that the parties have
exhausted the following escalation procedure.
11.3 Additional Restrictions. This Agreement shall terminate on ninety
(90) days notice in the event that (i) [***] enters into an agreement with SII
to merge with, acquire thirty percent (30%) or more of the outstanding capital
stock or material assets of, or purchase all or substantially all of the assets
of a specific business unit of the SII that is distributing or using the NTI
Products, Check-It or Model Calibrator, or (ii) SII enters into an agreement to
merge with or acquire thirty percent (30%) or more of the outstanding capital
stock or material assets of [***] and the resulting combined entity distributes
a product that incorporates any of the NTI Products, Check-It or Model
Calibrator (iii) SII distributes or licenses the NTI Product Components, CheckIt
or Model Calibrator, or any product incorporating these NTI products, to [***].
Upon receipt of notice under this Section 11.3, SII may continue to exercise its
license rights pursuant to the
Numerical Technologies, Inc. - Seiko Instruments, Inc. 12
[***]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
terms and conditions of this Agreement in order to fulfill End User orders
accepted up until fifteen (15) days prior to the effective date of such
termination.
11.4 Effect of Termination. Except as otherwise specifically set
---------------------
forth in this Agreement, the following sections shall survive the expiration or
termination, for any reason, of this Agreement: 1 (Definitions), 7 (Proprietary
Rights), 8 (Limited Warranty), 9 (Indemnification and Limitation of Liability),
10 (Confidentiality), 11.4 (Effect of Termination) and 12 (Miscellaneous). All
other Sections and all licenses hereunder shall terminate upon the expiration or
termination, for any reason, of this Agreement.
11.5 Return of Materials. Upon the expiration or termination of this
-------------------
Agreement for any reason, and except for copies of such items as may be
reasonably required by NTI to exercise any surviving rights or fulfill any
surviving obligations, NTI shall promptly (i) return to SII the originals and
all copies (in tangible form or stored in storage or memory devices) of all
Confidential Information of SII and all other material provided hereunder by SII
in NTI's possession or control; and (ii) provide SII with a written statement
certifying that it has complied with the foregoing obligations. Upon the
termination of this Agreement for any reason, and except for such items as may
be reasonably required by SII to exercise any surviving rights or fulfill any
surviving obligations, SII shall promptly (a) return to NTI the originals and
all copies (in tangible form or stored in storage or memory devices) of all
Confidential Information of NTI and all other material provided hereunder by NTI
in SII's possession or control; and (b) provide NTI with a written statement
certifying that it has complied with the foregoing obligations.
11.6 Remedies Cumulative. Termination shall be in addition to all
-------------------
other legal or equitable remedies available to either party.
12. MISCELLANEOUS.
12.1 Waiver and Amendment. No modification, amendment or waiver of
--------------------
any provision of this Agreement shall be effective unless in writing and signed
by the party to be charged. No failure or delay by either party in exercising
any right, power, or remedy under this Agreement, except as specifically
provided herein, shall operate as a waiver of any such right, power or remedy.
12.2 No Limitation. Use of the word "including" is meant to be
-------------
illustrative only and not limiting.
12.3 Descriptive Headings. The descriptive headings herein are
--------------------
inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement.
12.4 Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of California without
application of any choice of law principles. All disputes under this Agreement
shall be brought in the
Numerical Technologies, Inc. - Seiko Instruments, Inc. 13
courts located in Santa Xxxxx County, California. The rights and obligations of
the parties under this Agreement shall not be governed by the 1980 U.N.
Convention on Contracts for the International Sale of Goods.
12.5 Independent Contractors. The parties are independent
-----------------------
contractors. Neither party shall be deemed to be an employee, agent, partner or
legal representative of the other for any purpose and neither shall have any
right, power or authority to create any obligation or responsibility on behalf
of the other.
12.6 Assignment. Neither party may, by operation of law or otherwise,
----------
assign any of its rights or delegate any of its obligations under this Agreement
without the prior express written consent of the other party. Notwithstanding
the foregoing, either party may assign all (but not part) of its rights and
delegate all (but not part) of its obligations under this Agreement to a third
party as part of any acquisition of such assigning party by such third party,
provided that notice of and details concerning such proposed assignment and
delegation is given to the non-assigning party. Subject to the foregoing, this
Agreement will bind and inure to the benefit of the parties, their respective
successors and permitted assigns. Any permitted assignment under this Section
12.6 shall be subject to the assignee agreeing in writing to be bound by all the
terms and conditions of this Agreement.
12.7 Notices. All notices and other communications hereunder shall
-------
be in writing and shall be deemed to have been duly given when delivered in
person, by telecopy with answer back, by express or overnight mail delivered by
a nationally recognized air courier (delivery charges prepaid), or by registered
or certified mail (postage prepaid, return receipt requested) to the respective
parties or to such other address as the party to whom notice is given may have
previously furnished to the others in writing in the manner set forth above. Any
notice or communication delivered in person shall be deemed effective on
delivery. Any notice or communication sent by telecopy or by air courier shall
be deemed effective on the first Business Day at the place at which such notice
or communication is received following the day on which such notice or
communication was sent. Any notice or communication sent by registered or
certified mail shall be deemed effective on the third Business Day at the place
from which such notice or communication was mailed following the day on which
such notice or communication was mailed. As used in this Section 12.7, "Business
Day" means (i) when such term is being used to calculate the notice to NTI, any
day other than a Saturday, a Sunday or a day on which banking institutions
located in the State of California are authorized or obligated by law or
executive order to close, or (ii) when such term is being used to calculate the
notice to SII, any day other than a Saturday, a Sunday or a day on which banking
institutions located in Japan are authorized or obligated by law or executive
order to close.
12.8 Severability. If any provision of this Agreement is held by a
------------
court of competent jurisdiction to be contrary to law, such provision shall be
changed and interpreted so as to best accomplish the objectives of the original
provision to the fullest
Numerical Technologies, Inc. - Seiko Instruments, Inc. 14
extent allowed by law and the remaining provisions of this Agreement shall
remain in full force and effect.
12.9 Entire Agreement. This Agreement, including all Exhibits
----------------
attached hereto, constitutes the final, complete and exclusive agreement between
the parties with respect to the subject matter hereof, and supersedes any prior
or contemporaneous agreement.
12.10 Amendment. No change or amendment will be made to this
---------
Agreement except by an instrument in writing signed on behalf of each of the
parties to such agreement.
12.11 Exhibits. Each Exhibit attached to this Agreement is deemed a
--------
part of this Agreement and incorporated herein wherever reference to it is made.
12.12 No Implied Licenses. No licenses are to be implied from any
-------------------
term of this Agreement other than the licenses expressly granted herein.
12.13 Counterparts. This Agreement may be executed in counterparts,
------------
each of which will be deemed an original.
12.14 Language. This Agreement is in the English language only, which
--------
language will be controlling in all respects, and all versions hereof in any
other language will not be binding on the parties hereto. All communications and
notices to be made given pursuant to this Agreement shall be in the English
language. The parties hereto confirm that it is their desire that this
Agreement, as well as all other documents relating hereto, including notices,
have been and will be made in the English language only.
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
by their duly authorized representatives.
NUMERICAL TECHNOLOGIES, INC. SEIKO INSTRUMENTS INC.
By: /s/ Xxxxxxxx X. Xxxx By: /s/ Xxxxxxxx Xxxxx
-------------------- ------------------
Name: Xxxxxxxx X. Xxxx Name: Xxxxxxxx Xxxxx
--------------- --------------
Title: President & CEO Title: Deputy Division Manager
--------------- -----------------------
Date: December 23, 1999 Date: January 6, 2000
----------------- ---------------
Numerical Technologies, Inc. - Seiko Instruments, Inc. 15
EXHIBIT A: NTI PRODUCTS
SII Silicon Design Rule Check (SII-SiDRC), Version 1.0: Silicon vs. Layout
verification software engine, in the form of binary shared libraries, that uses
lithography simulation to locate and flag areas of an integrated circuit layout
design that produce projected wafer patters outside the specified tolerance.
This engine is accompanied with a C header-file that allows the user to call the
engine's API.
SII-ImagIC, Version 1.1: Software engine, in the form of binary shared
libraries, that generates real-time wafer image from layout data using
lithography simulation. This engine is accompanied with a C header-file that
allows the user to call the engine's API.
SII-Customized NumeriTech Optical Proximity Correction Tool (SII-NOPC),
Version 1.0: Rules-based Optical Proximity Correction software engine, in the
form of binary shared libraries, that applies corrections based on the OPC rules
to compensate for the subwavelength lithography effects. This engine is
accompanied with a C header-file that allows the user to call the engine's API.
SII-Batch-NOPC, Version 3.1: Rules-based Optical Proximity Correction
software, in the form of binary application, that applies corrections based on
the OPC rules to compensate for the subwavelength lithography effects.
RuleGen Version 1.3 which provides for the automatic creation of the OPC
rules from the calibrated optical/lithography process models.
SII-Batch-SiDRC, Version 3.1: Silicon vs. Layout verification software, in
the form of binary application, that uses lithography simulation to locate and
flag areas of an integrated circuit layout design that produce projected wafer
patters outside the specified tolerance
Numerical Technologies, Inc. - Seiko Instruments, Inc. 16
EXHIBIT B: SII PRODUCT
"SII Product" means technology identified as "SX-9000" or "SX-GIGA" in marketing
materials and Price Lists and comprising the VLSI design layout system developed
by combining Seiko Instrument's CAD technology and VLSI technology.
Numerical Technologies, Inc. - Seiko Instruments, Inc. 17
EXHIBIT C : TRADEMARKS
NTI Trademarks:
NTI Trademarks: Registered Trademark: Virtual Stepper (R)
Corporate Trademarks: Numerical Technologies (TM), Inc.
NumeriTech (TM)
The Numerical Technologies logo.
Product Trademarks:
IN-Phase
TROPiC
N-Abled
SiVL
ImagIC
SiDRC
SiImage
Rule-Gen
Model-Gen
NOPC
IC Workbench
Numerical Technologies, Inc. - Seiko Instruments. Inc. 18
CONFIDENTIAL
EXHIBIT D: DEVELOPMENT FEES
1. Development Fees.
----------------
File level integration [***]
Engine level/API level integration [***]
Total [***]
--------------------------------------------------------------------------------
2. Schedule for Payment of Development Fees. SII shall pay to NTI the
----------------------------------------
Development Fees on or before the following dates:
April 30, 2000 [***]
July 31, 2000 [***]
October 31, 2000 [***]
January 31, 2000 [***]
Numerical Technologies, Inc. - Seiko Instruments, Inc.
[***]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit E: License and Maintenance Fees
License Fees
In consideration of the rights and licenses granted hereunder and for each
Key shipped by NTI SII shall pay NTI the following License Fees:
1. NTI Products. SII shall pay NTI [***] of the then-current SII List Price
------------
for the each NTI Product distributed as part of the SII Combined Products
("NTI Products License Fee"), but in no event less than [***] copy.
2. Check-It. SII shall pay NTI [***] of the then-current NTI US List Price for
--------
each copy of Check-It distributed under the license in Section 2.1 (iii)
("Bundled Check-It License Fee"). In addition, SII shall pay NTI [***] of
the then-current NTI U.S. List Price for each copy of Check-It distributed
under the license in Section 2.1 (iv) ("Standalone Check-It License Fee"),
and NTI discuss with SII on a case-by-case basis the possibility of
adjusting this Standalone Check-It License Fee where necessary to obtain a
deal with a potential End User.
3. ModelCalibrator. SII shall pay NTI [***] of the then-current SII List Price
---------------
for the Bundled Product for copy of the ModelCalibrator distributed
hereunder ("ModelCalibrator License Fee"), but in no event less than [***]
per copy.
4. Floating License. SII shall pay [***] of the fees in Sections 1 through 3
above, in any instance in which SII grants a Floating License to an End
User.
License Fee-Free Licenses
On the conditions that SII has made timely payments to NTI of the
Development Fees indicated in Exhibit D, NTI shall provide a total of three Keys
at no additional cost to SII at the time that SII makes it's first sale of SII
Combined Product to it's end-user customer.
Maintenance Fees
In consideration of the support provided to SII by NTI under Section 7 of
this Agreement SII shall pay NTI the following Maintenance Fees:
1. NTI Products. SII shall pay NTI annual Maintenance Fee equal to [***] of
------------
the NTI Products License Fee. Thus, the NTI Products Maintenance Fees
payable to NTI by SII shall be calculated as follows: SII then-current List
Price for the SII Combined Products x [***], but in no event less than
[***] per year per copy.
[***]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
2. Check-It. SII shall pay NTI annual Maintenance Fee equal to [***] of the
--------
Bundled Check-It License Fee ("BUNDLED CHECK-IT MAINTENANCE FEES"). Thus,
the Check-It Maintenance Fees payable by SII to NTI shall be calculated as
follows: NTI then-current US List-Price for Check-It x [***]. In addition,
SII shall pay NTI annual Maintenance Fee equal to [***] of the Standalone
Check-It License Fee ("STANDALONE CHECK-IT MAINTENANCE FEES"). Thus, the
Standalone Check-It Maintenance Fees payable by SII to NTI shall be
calculated as follows: NTI then-current U.S. List-Price for Check-It x
[***].
For distribution of Check-It to End Users pursuant to Section 2.1(iv) only,
NTI agrees to waive the Standalone Check-It Maintenance Fees for the first
year following the license of Check-It to End Users pursuant to Section
2.1(iv).
3. Model Calibrator. SII shall pay NTI annual Maintenance Fee equal to
----------------
[***] of the ModelCalibrator License Fee. Thus, the ModelCalibrator
Maintenance Fees payable to NTI by SII shall be calculated as follows: SII
then-current List Price for the SII Combined Products x [***], but in no
event less than [***] per year per copy.
PRICE LISTS.
Within ten (10) days following the Effective Date of this Agreement, each
party agrees to provide its Price List to the other party. Each party is free to
set prices in their sole discretion. Within ten (10) days of making any changes
to the Price List ("Updated Price List"), each party shall make available to the
other party such Updated Price List.
Numerical Technologies, Inc. - Seiko Instruments, Inc. 21
[***]=CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
