EXHIBIT 10.23
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE COPY
FILED HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY REQUEST.
OMISSIONS ARE DESIGNATED AS *. A COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED
SEPARATELY WITH THE SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION.
SILICON PRODUCT DEVELOPMENT
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AND
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PRODUCTION COLLABORATION AGREEMENT
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Silicon Product Development and Production Collaboration Agreement (this
"Agreement"), dated as of July 28, 2004 (the "Effective Date"), is by and
between GDA Technologies, Inc., a California corporation having principal place
of business at 0000 Xxxxxx Xxxxxx, Xxx Xxxx, XX , 00000 ("GDA"), and Arkados,
Inc., a Delaware Corporation having its principal place of business at 000 XX
Xxxxxxx 00, Xxxxx Xxxxxxxxxx, XX 00000 ("Arkados"). GDA and Arkados are referred
to individually hereinafter as a "Party" and collectively as the "Parties".
RECITALS
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WHEREAS, Arkados has created and markets a power line based technology that
permits data transmission over active "in-building" power networks and also
developed technology for data transmission over powerline distribution networks;
WHEREAS, Arkados has designed a semiconductor component for in-building
power networks and owns certain technology related thereto and GDA possesses
know-how relating to the development, fabrication, and testing of semiconductor
products;
WHEREAS, GDA and Arkados desire to collaborate in the production of a
semiconductor component product for in-building power networks that will be sold
by Arkados in the open market;
WHEREAS, the parties will explore future cooperation related to other
semiconductor products of Arkados. The Parties may enter into one or more
separate agreements with respect to such future cooperation if they see fit for
their business.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and the mutual
promises and covenants contained herein, the Parties hereby agree as follows:
ARTICLE I. DEFINITIONS
For purposes of this Agreement, the terms defined in this Article shall
have the meanings specified below:
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1.1 "AFFILIATE" shall mean any corporation or other entity, which
controls, is controlled by, or is under common control with, a Party
to this Agreement. A corporation or other entity shall be regarded as
in control of another corporation or entity if it owns or directly or
indirectly controls at least fifty-one (51) percent of the voting
stock or other voting equity interest of the other corporation or
entity.
1.2 "GDA SERVICES" shall mean the services to be provided by GDA pursuant
to this Agreement and as outlined in Annex-A. Details of the GDA
Services shall be as described in Task Orders to be entered into by
the Parties. GDA shall perform the GDA Services in a professional
manner using qualified personnel.
1.3 "BUSINESS DAY" shall mean all days other than Saturdays, Sundays, and
other days on which United States banks are closed.
1.4 "DESIGN LICENSE" shall have the meaning set forth in Section 3.1.
1.5 "EFFECTIVE DATE" shall have the meaning set forth in the preamble this
Agreement.
1.6 "FOUNDRY" shall mean a third party foundry selected by Arkados, in its
discretion after consultation with GDA, to provide silicon foundry
services with respect to the Product.
1.7 "INTELLECTUAL PROPERTY RIGHTS" shall mean any and all (i) Letters
Patent and all pending applications for Letters Patent, including any
reissue, reexamination, division, continuation, or
continuation-in-part applications throughout the world; (ii) trade
secret rights and equivalent rights arising under the common law,
state law, federal law, and laws of foreign countries; (iii)
copyrights, mask works, other literary property or authors rights,
whether or not protected by copyright or as a mask work, under common
law, state law, federal law, and laws of foreign countries; and (iv)
proprietary indicia, trademarks, service marks, trade names, symbols,
logos, and/or brand names under common law, state law, federal law,
and laws of foreign countries.
1.8 "NECESSARY CLAIMS" shall mean those claims of all patents, other than
design patents and design registrations, which are necessarily
infringed by an implementation of standards based technologies
incorporated into the Product which cannot be avoided by another
commercially reasonable non-infringing implementation of such
standards based technologies.
1.9 "PRELIMINARY SPECIFICATIONS" means the preliminary functional
specifications for the Product that set forth in Annex-B.
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1.10 "PRODUCT" shall mean the semiconductor component product that Arkados
has code-named "PowerWave" and the specification of which conforms
substantially to the Specification.
1.11 "PRODUCT TECHNOLOGY" shall mean any Intellectual Property Rights in
and to any technology that is developed or improved by a Party in
connection with the development activities relating to the Product
that are carried out under this Agreement, Using Arkados' or Arkados'
licensors intellectual property.
1.12 "PRODUCT-RELATED MATERIALS" shall mean drawings, documents,
specifications, designs and other materials, whether in tangible or
electronic form, that comprise or incorporate Product Technology.
Except for PG-tape, mask set, CP testing program and FT testing
program.
1.13 "PRODUCTION COST" shall mean the sum of the following: Foundry die
cost, assembly and package cost, component test cost, and any
royalties payable by Arkados directly or indirectly through GDA to any
third party by reason of the incorporation of any IP blocks of such
third party in the Product or otherwise by reason of the making or
selling of the Product. Production Cost shall be denominated in US
dollars. (Royalties related to licensing of Necessary Claims shall not
be included in Production Cost. Production Cost shall be determined by
Arkados within fifteen (15) days after the end of each fiscal
quarter.)
1.14 "SIGNOFF" shall mean the iteration of data In and Physical Layout will
be repeated until the results of netlist, timing and post simulation
satisfies both Parties by signing a sign-off document
1.15 "SPECIFICATIONS" means the Preliminary Specifications, as modified
from time to time by Arkados in its sole discretion.
1.16 "STEERING COMMITTEE" shall mean a committee consisting of
representatives of each of Arkados and GDA that are designated from
time to time by the respective Party. The Steering Committee will meet
at least once a month pursuant to an agreed schedule. The members of
the Steering Committee are specified in Annex D. The Parties agree
that either party may change its designated representatives provided
the other Party is notified in writing in advance and approves such
change, such approval shall not to be unreasonably withheld or
delayed. The Steering Committee shall act only by unanimous agreement
of its members; provided that if the Steering Committee is deadlocked
on any issue that the it is assigned responsibility under this
Agreement to determine or resolve, the issue shall be determined or
resolved by the Presidents of each of the Parties, who shall determine
or resolve the issue by mutual agreement.
1.17 "THIRD PARTIES" shall mean any person or entity other than Arkados and
GDA or their respective Affiliates.
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1.18 "TASK ORDER" shall mean a separate addendum to this Agreement setting
forth the specific GDA Services to be performed by GDA pursuant to
this Agreement. Task Orders entered into by the parties shall: (i)
refer expressly to this Agreement; (ii) designate the date as of which
the provisions of the Task Order will be effective and, if applicable,
the term or period of time during which GDA will perform services,
provide resources or otherwise discharge its obligations as specified
in the Task Order; (iii) describe the services to be performed,
resources to be provided or obligations to be discharged by GDA
pursuant to the Task Order and any applicable development milestones
and acceptance requirements; (iv) describe the obligations of Arkados
related to the Task Order, including any facilities, equipment,
personnel and tasks or other support to be provided or performed by
Arkados; and (v) specify any other terms and conditions appropriate to
the services to be performed and the obligations of the Parties.
1.19 "GDA DELIVERABLES" shall mean materials resulted from performance of
GDA services by GDA pursuant to this agreement and as outlined in
Annex-A.
ARTICLE II. GENERAL STRUCTURE OF RELATIONSHIP
2.1 ROLE OF ARKADOS. The Parties agree and acknowledge that, subject to
the performance by GDA of the GDA Services, Arkados is responsible for
completion of the design and development of the Product, including the
design and development of (i) powerline MAC layer, Powerline PHY layer
and related hardware blocks, which will be the core of the Product;
(ii) overall Product architecture; and (iii) relevant firmware and
software drivers for the Product. In connection with such design and
development, Arkados shall be responsible for preparing the
deliverables listed in Annex-A (marked as Arkados deliverables ARK-DE)
hereto (the "Arkados Deliverables").
2.2 INTELLECTUAL PROPERTY OWNERSHIP. Arkados is and shall remain the sole
owner of all Intellectual Property Rights associated with the Product
and related technologies, including without limitation all Product
Technology and Product-Related Materials and any derivative works
based on any of the foregoing, subject to any grant by Arkados of the
Design License pursuant to Section 3.1.
2.3 PERFORMANCE OF SERVICES BY GDA. GDA will provide to Arkados the GDA
Services in accordance with the terms of Task Orders enter into by and
between Arkados and GDA. GDA and Arkados agree to negotiate in good
faith the terms of, and to use reasonable efforts to enter into, the
initial Task Order providing for the performance by GDA of the GDA
Services outlined in Annex-A hereto within 30days of the Effective
Date. GDA shall perform the GDA Services in accordance with the terms
of the relevant Task Order and will use its best efforts to comply
with the project schedule set out in Annex-C, as it may be amended by
mutual agreement in writing from time to time. If GDA determines that
it is unable or unwilling to continue with the development of the
Product pursuant to this Agreement (including by reason of cessation
of business or the bankruptcy of
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GDA) GDA agrees to negotiate in good faith with Arkados the terms of
mutually acceptable alternative arrangements for continuing with the
development and manufacture of the Product, which would include
providing Arkados with a license to use the GDA Deliverables and other
information owned by GDA, data and information including business
relationships needed to complete the development and production of the
Product.
2.4 DELIVERY. GDA shall use commercially reasonable efforts to deliver GDA
Deliverables specified in Annex A and Annex C for testing and/or
acceptance. At each delivery, GDA shall memorialize such delivery in a
signed delivery confirmation sheet that sets forth the nature and
condition of the GDA Deliverables, the medium in which GDA
Deliverables reside, and the date of the delivery. Arkados shall
countersign such delivery confirmation sheet so as to indicate the
receipt of the contents described therein.
2.5 TESTING AND ACCEPTANCE. Upon receipt of GDA Deliverables, Arkados
shall immediately commence, and conclude as promptly as practical,
acceptance testing of such deliverable items in accordance with
acceptance criteria mutually agreeable to both parties. Upon
completion of such acceptance testing, Arkados shall issue to GDA a
notice of acceptance or a notice of rejection. In the event of
rejection, Arkados shall give its reasons for rejection in reasonable
detail, and GDA shall use its reasonable effort to correct the
deficiency or nonconformity and redeliver the GDA Deliverables as
promptly as practical. In the event Arkados has not delivered a notice
of acceptance or a notice of rejection within 15 business days of
receipt of GDA Deliverables, Arkados will be deemed to have accepted
such GDA Deliverables.
2.4 MANUFACTURING OF PRODUCT. Arkados will be responsible for the
manufacturing of the Product; provided, that GDA, acting on behalf of
Arkados, will be responsible for (i) negotiating (subject to Arkados'
approval) the terms of a foundry agreement with the Foundry under
which the Product would be manufactured, including without limitation
any pricing terms, (ii) monitoring and managing the Foundry's
performance under the foundry agreement; and (iii) accepting,
packaging and testing Product delivered by the Foundry.
2.5 BRANDING Product will be sold under the Arkados logo as a brand name
or such other names as Arkados, in its sole discretion, shall select.
The size and location of any placement of the Arkados logo on the
Product or any packaging will be determined by Arkados.
ARTICLE III. LICENSE GRANT
3.1 Subject to the terms and conditions of this Agreement, Arkados hereby
grants to GDA, a personal, nonexclusive, and nontransferable internal
use license to use (the "Design License") Arkados' Intellectual
Property Rights in and to the Product solely for the purpose of
performing GDA Services and its obligations
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pursuant to this Agreement, including without limitation in connection
with the design and development of Product Technology or
Product-Related Materials. No right to sublicense is granted to GDA
hereunder.
3.2 Arkados and its licensors retain sole and exclusive title to and
ownership of the Intellectual Property Rights in and to the Product
and the technologies incorporated therein and any derivative works
based thereon, including all copies, whether made by Arkados or GDA
and regardless of the form or media in or on which the original and
copies may exist Arkados and its licensors retain sole and exclusive
title to and ownership of any and all modifications and updates to or
of such Intellectual Property Rights made by Arkados and its
licensors. Arkados shall have sole and exclusive title to and
ownership of the Product Technology, the Product-Related Materials.
3.3 Arkados, as the sole and exclusive owner of the Intellectual Property
Rights in the Product, shall have full responsibility, in its sole
discretion, for filing, prosecuting and maintaining of patents and/or
other applications or registrations worldwide with respect to any
patentable or registerable inventions associated with the Product.
3.4 Except as expressly provided in this Agreement, GDA shall not, and
shall not permit any third party to, use, copy, modify, sublicense,
distribute or otherwise transfer to any third party, the Intellectual
Property Rights, the Product Technology or the Product-Related
Materials or any other product or technology incorporating or
utilizing any Intellectual Property Rights of Arkados.
3.5 GDA will promptly disclose to Arkados all inventions relating to or
based upon Product Technology, Product-Related Materials and
Intellectual Property Rights developed by GDA during the Term and will
execute such assignment, and other documents reasonably requested by
Arkados, to perfect and record Arkados' rights as set forth in
paragraph 3.3 above.
ARTICLE IV. PAYMENTS
4.1 In consideration of the work performed under the paragraph 1 of the
Initial Task Order (a) Arkados will pay GDA $* (*). Arkados will pay
$* as advance at the start of the project and the remaining ($*)
payments to be made in equal monthly installments of $* (*) for the
first * months of the project. Parties further agree that above
described payments could be made in a form of * if mutually agreed by
the parties at the time when a specific payment is due. If no
agreement is reached then payment will occur in cash. Should GDA fails
to adhere to mutually agreed upon schedule Arkados has the right to
stop payments and parties shall resolve the issue as provided for in
2.3. If the project is terminated for any reason, all payments owed up
to and including the termination date shall be due and payable in full
immediately upon termination; and
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(b) XXXxxx.Xxx, Inc., Arkados' corporate parent and a Delaware
corporation, ("CDK") shall issue an aggregate of 150,000 shares of its
common stock to GDA pursuant to a Restricted Stock Purchase Agreement.
4.2 In consideration of the work performed under the paragraph 2 of the
Initial Task Order Arkados will pay GDA the fee that shall be
calculated as ** GDA shall provide all necessary information to allow
Arkados to determine Production Cost and Product quantities.
4.3 GDA will be solely responsible for payment to the Foundry and other
Third Parties for the following: Foundry NRE, mask charges,
engineering (sample) lot production fee, packaging NRE, testing NRE
and other tooling related fees, but will be promptly reimbursed by
Arkados upon written request of GDA. Such written request shall be
accompanied with all necessary supporting information that would allow
Arkados to confirm such costs. If re-spins of the Product are
necessary, the responsibility for the cost of such re-spins shall be
determined as provided in Section 4.4. GDA will need advance payment
from Arkados for making such payments.
4.4 If a new production run is needed due to a logic design flaw or other
defects for which Arkados is responsible, Arkados will be solely
responsible for the incremental fees and costs associated with the new
production run. If a new production run is needed due to problems,
which relate to an aspect of the GDA Services for which GDA is
responsible GDA will redo the required services free of charge to get
to the new production but the incremental fees and costs associated
with the new production run will be equally split between GDA and
Arkados.
ARTICLE V. CONFIDENTIALITY
5.1 Nondisclosure Obligations. During the term of this Agreement and for a
period of three (3) years thereafter, each Party shall maintain in
confidence and use only for purposes of this Agreement any information
supplied by the other Party (whether or not designated at the time of
disclosure as "confidential" or the like) either in writing or
verbally in connection with this Agreement, including information
exchanged pursuant to the Mutual Confidentiality Agreement. For
purpose of this Article V, such information and data that has been so
supplied by a Party shall be referred to herein as "Information."
Notwithstanding the foregoing, to the extent it is reasonably
necessary or appropriate to fulfill its obligations under this
Agreement, a Party may disclose Information to its Affiliates,
consultants, and outside contractors, strictly on a need-to-know
basis, on the condition that such entities or persons shall have
agreed in writing to keep the Information confidential for the same
time periods and to the same extent as such Party is required to keep
the Information confidential; and a Party may disclose such
Information to government or other regulatory authorities to the
extent that such disclosure is reasonably necessary to obtain patents
or authorizations to conduct
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trials with and to commercially market the Product or if such
disclosure is required by applicable law or order of the court. The
obligation not to disclose Information shall not apply to any part of
such Information that (i) is or becomes patented, published, or
otherwise part of the public domain other than by acts of the Party
obligated not to disclose such Information or its Affiliates or sub
licensees in contravention of this Agreement; or (ii) is disclosed to
the receiving Party or its Affiliates by a Third Party, unless such
Information was obtained by such Third Party directly or indirectly
from the other Party to this Agreement on a confidential basis; or
(iii) prior to disclosure under this Agreement, was already in the
possession of the receiving Party or its Affiliates, unless such
Information was obtained directly or indirectly from the other Party
to this Agreement on a confidential basis.
5.2 Terms of This Agreement. Arkados and GDA each agrees not to disclose
any terms or conditions of this Agreement to any Third Party without
the prior written consent of the other Party hereto, except as
required by applicable laws or except to such Party's existing or
prospective investors, lenders or possible acquirers or merger
partners that are bound by appropriate confidentiality undertakings.
5.4 Press Releases and Public Disclosure. No Party shall make a press
release or public disclosure related to the Project, without first
obtaining the written consent of the other Party, which consent may
not be unreasonably withheld.
ARTICLE VI INTENTIONALLY OMITTED.
ARTICLE VII. TERM AND TERMINATION
7.1 EFFECTIVE DATE. This Agreement shall become effective as of the
Effective Date.
7.2 EXPIRATION. This Agreement shall expire at the end of five (5) years
from the Effective Date unless earlier terminated as provided herein.
7.3 TERMINATION FOR CAUSE. Either Party may terminate this Agreement upon
the occurrence of any of the following:
(a) upon or after the bankruptcy, insolvency, dissolution, or winding
up of the other Party; or
(b) upon or after the breach of any material provision of this
Agreement by the other Party if the breaching Party has not
commenced to cure such breach within thirty (30) days after
written notice thereof by the other Party and thereafter
proceeded diligently to cure such breach within a reasonable
time. In no event shall such reasonable time to cure such breach
exceed ninety (90) days from the date of such notice.
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7.4 CHANGE OF CONTROL. A Party (the "Non-changing Party") may terminate
this Agreement upon written notice to the other Party (the "Changing
Party") if a change of control relating to a competitor occurs with
respect to the Changing Party. For the purposes hereof, (i) a "change
of Control relating to a competitor" shall mean (A) the Changing Party
merges with or into a competitor of the Non-changing Party (whether or
not the Changing Party is the surviving entity following such merger)
and as a result of such merger the holders of the Changing Party's
voting securities prior to the merger do not hold a Controlling
interest of the surviving entity from such merger; (B) the Changing
Party becomes a subsidiary of a competitor of the Non-changing Party
or (C) a competitor of the Non-changing Party acquires all or
substantially all of the Changing Party's assets; (ii) "Control" means
ownership of securities possessing more than 51 percent of the total
combined voting power of all classes of securities entitled to vote
and at least 51 percent of the total number of securities of all other
classes of securities; and (iii) "competitor" means any entity that
the Non-changing Party reasonably determines at the relevant time to
be a competitor or any entity controlling, controlled by or under
common control with such competitor.
7.5 TERMINATION WITHOUT CAUSE
7.5.1 Arkados may terminate this agreement as follows:
a) Termination during the period covered by the Paragraph 1 of
the Scope Of Work. During this period Arkados may terminate
this agreement with the 60 days notice. No fees other than
as described in 4.1 shall be due as of the Termination Date.
b) Termination upon the completion of the work covered by the
Paragraph 1 of the Scope Of Work. If Arkados decides not to
proceed with the manufacturing of the Product no fees other
than as described in 4.1 shall be due as of the Termination
Date.
c) Termination during the phase described by paragraph 2 of the
Scope Of Work.
a. If Arkados decides to continue the manufacturing of the
Product without GDA, Arkados shall pay GDA $* less the
amount already paid that was due to GDA under 4.2 of
this agreement.
b. If Arkados decides to stop the manufacturing of the
Product no fees other than as described in 4.1 and the
amount due to GDA under 4.2 shall be due as of the
Termination Date.
7.5.2 GDA may terminate agreement as follows, GDA shall provide
Arkados with 60 days written notice.
7.6 EFFECT OF TERMINATION; SURVIVAL. Expiration or termination of this
Agreement shall not relieve the Parties of any obligation accruing
prior to such expiration or termination. Upon termination, each Party
shall destroy or return to the other
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Party all documents, files (whether electronic or otherwise) and other
materials containing confidential information of the other Party.
Unless GDA has terminated this Agreement for breach by Arkados,
promptly following termination of this Agreement GDA shall deliver to
Arkados all copies of documents or other tangible media containing or
embodying any Product Technology or Product-Related Materials or other
Intellectual Property Rights of Arkados. The provisions of Article
III, Article V, Article VIII, Section 9.3, and Article X shall survive
the termination of this Agreement.
ARTICLE VIII INDEMNITY
8.1 Each Party (the "Indemnifying Party") shall protect, defend, and,
indemnify and hold harmless the other Party, its officers, directors,
agents, employees, contractors, and representatives (the "Indemnified
Party") from and against all claims, demands, liabilities,
obligations, deficiencies, losses, damages, actions, suits,
proceedings, assessments, judgments, or settlements, (including all
reasonable attorneys' fees) (each a "Claim") arising out of the acts
or omissions of the Indemnifying Party or its Affiliates in connection
with the work performed pursuant to this Agreement, excluding any
Claim that is attributable to the willful misconduct or negligence of
the Indemnified Party.
8.2 Each Party shall protect, defend, and, indemnify and hold harmless the
other Party, its officers, directors, agents, employees, contractors,
and representatives from and against all Claims arising out of a Third
Party claim that the design of the Product infringes upon the
intellectual property or other rights of such Third Party.
8.3 The Indemnifying Party's obligation to indemnify the Indemnified Party
is subject to the Indemnifying Party's compliance with the following:
(a) The Indemnified Party notifies the Indemnifying Party in writing
promptly upon receipt of notification of a Claim. To the extent
an intentional delay materially prejudices the Indemnifying
Party's defense of a Claim, the Indemnifying Party shall be
relieved of the defense of that part of the defense.
(b) The Indemnifying Party has sole control of the defense and all
related settlement negotiations, subject to the right of the
Indemnified Party to participate in and monitor such defense, at
its own cost and option and through its own counsel.
(c) The Indemnified Party provides the Indemnifying Party with the
assistance, information, and authority necessary to perform as
required above, provided that reasonable costs and expenses
incurred by the
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Indemnified Party in providing such assistance and information
will be reimbursed by the Indemnifying Party.
(d) The Indemnified Party is not an Affiliate of the third party
making the claim.
ARTICLE IX REPRESENTATIONS AND WARRANTIES
9.1 Authorization. Each Party warrants and represents to the other that it
has the legal rights and power to assign or extend the rights and/or
licenses granted to the other Party in this Agreement, that it has the
full right and power to enter into this Agreement and to fully perform
its obligations hereunder, and that it has not made nor will it make
any commitments to others in conflict with or in derogation, of any
such rights or this Agreement. Each Party further represents to the
other that it is not aware of any legal obstacles, including patent
rights of others, which could prevent either Party from carrying out
the provisions of this Agreement.
9.2 Patent Validity; Non-Infringement. Nothing in this Agreement shall be
construed as a warranty or representation by either Party as to the
validity or scope of any patent rights or that the exercise of any
Intellectual Property Rights granted or assigned by such Party shall
not infringe any Intellectual Property Rights of any Third Parties.
9.3 GDA Deliverables. GDA will use its best efforts to conform
deliverables to Arkados with the applicable specifications.
9.4 Disclaimer of Warranties. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED
HEREUNDER, THE DELIVERABLES AND TECHNOLOGY BEING PROVIDED OR LICENSED
BY EITHER PARTY HEREUNDER ARE BEING PROVIDED "AS IS" AND SUCH PARTY
MAKES NO, AND SUCH PARTY HEREBY DISCLAIMS ALL, OTHER WARRANTIES,
EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION, WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR
NON-INFRINGEMENT WITH REGARD TO ANY SUCH DELIVERABLES AND TECHNOLOGY.
ARTICLE X LIMITATION OF LIABILITY
GDA's LIABILITY ARISING OUT OF THIS AGREEMENT OR THE DEVELOPMENT OF THE PRODUCTS
SHALL BE LIMITED TO THE PAYMENT IT RECEIVED FOR ITS SERVICES (NOT INCLUDING ANY
PAYMENTS TO THIRD PARTIES). IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE
OTHER PARTY OR ANY OTHER PERSON OR ENTITY FOR ANY EXEMPLARY, SPECIAL,
CONSEQUENTIAL, INCIDENTAL, OR INDIRECT DAMAGES, OR FOR ANY LOST PROFITS,
BUSINESS INTERRUPTION, OR LOSS OF BUSINESS INFORMATION, HOWEVER CAUSED, ON ANY
THEORY OF LIABILITY, AND WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES. THESE LIMITATIONS SHALL APPLY
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NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY. GDA'S
LIABILITY WILL EXPIRE 1 YEAR AFTER THE FINAL DELIVERABLES.
ARTICLE XI MISCELLANEOUS
11.1 EXPORT. In order to comply with the U.S. Export Administration Act of
1979, as amended from time to time (the "Export Act"), each Party
hereby certifies that no technology or information licensed from the
other, and no product thereof, will be made available or re-exported,
directly or indirectly, to any areas outside the United States except
in compliance with all applicable laws and regulations of the Bureau
of Export Administration in accordance with the Export Act (the
provisions of this clause shall be extended in accordance with U.S.
law or regulation).
11.2 FORCE MAJEURE. Neither Party shall be held liable or responsible to
the other Party nor be deemed to have defaulted under or breached this
Agreement for failure or delay in fulfilling or performing any term of
this Agreement when such failure or delay is caused by or results from
causes beyond the reasonable control of the affected Party, including
but not limited to fire or floods; embargoes, war, acts of war
(whether war be declared or not), insurrections, riots, or civil
commotions; strikes, lockouts, or other labor disturbances; acts of
God; or acts, omissions, or delays in acting by any governmental
authority or the other Party; provided, however, it is understood that
this Section 11.2 is intended only to suspend and not discharge a
Party's obligations under this Agreement and that when the causes of
the failure or delay are removed or alleviated, the affected Party
shall resume performance of its obligations hereunder, provided,
however, that if the forece majeure event persist for a period of year
or more, the Party may agree to terminate this Agreement without
either Party being liable for such termination.
11.3 ASSIGNMENT. This Agreement may not be assigned or otherwise
transferred, nor, except as expressly provided hereunder, may any
right or obligations hereunder be assigned or transferred, by either
Party without the written consent of the other Party; provided,
however, that either Arkados or GDA may, without such consent, assign
this Agreement and its rights and obligations thereunder (a) in
connection with the transfer or sale of all or substantially all of
its business, if such assets include substantially all of the assets
relating to its performance of its respective obligations hereunder;
(b) to a wholly owned subsidiary; or (c) in the event of its merger or
consolidation with another company; provided that, in the case of an
transaction involving a Party of the type described in subparagraph
(a) or (c) of this provision, the transferee of the assets or the
entity with which such Party is being merged or consolidated is not a
competitor of the other Party. Any purported assignment in violation
of the preceding sentence shall be void. Any permitted assignee shall
assume all obligations of its assignor under this Agreement. Consent
to any such assignment shall not operate as a waiver of the necessity
for consent to any subsequent assignment.
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11.4 SUBCONTRACTS. Arkados and GDA each may subcontract their respective
obligations hereunder without the prior written consent of the other,
provided that (i) such subcontracting does not result in the transfer
of significant know-how to the subcontractor; (ii) the subcontractor
has entered into a confidentiality agreement with the contracting
Party on terms substantially equivalent to the requirements set forth
in Article V; and (iii) the contracting Party reasonably supervises
such contract work.
11.5 NO SOLICITATION. During the term of this Agreement and for a period of
one (1) year thereafter, each party agrees not to recruit or solicit
the services of any of the other's employees or contractors.
11.6 SEVERABILITY. Should one or several provisions of the Agreement be or
become invalid or unenforceable by reason of such a violation, then
the Parties hereto shall substitute, by mutual consent, valid
provisions for such invalid provisions, which valid provisions in
their economic effect come so close to the invalid provisions that it
can be reasonably assumed that the Parties would have contracted this
Agreement with those new provisions. In case such provisions cannot be
found, the invalidity of one or several provisions of the Agreement
shall not affect the validity of the Agreement as a whole, unless the
invalid provisions are of such essential importance for this Agreement
that it is to be reasonably assumed that the Parties would not have
contracted this Agreement without the invalid provisions.
11.7 DISPUTE RESOLUTIONS. In case any dispute shall arise with respect to
matters to be determined by the Steering Committee which cannot be
resolved within a reasonable period of time, the Parties'
representatives shall meet to attempt to resolve the matter prior to
either Party taking any legal action, in respect thereof. If the
Parties' representatives are unable to resolve any such dispute, such
dispute shall be settled pursuant to final and binding arbitration
conducted in the English language by a single arbitrator agreed by the
Parties in New York, NY, USA, in accordance with the Commercial Rules
of the American Arbitration Association applicable at the time such
dispute arises, and judgment upon the award may be entered by any
court of competent jurisdiction. . For purposes of clarification, the
Parties agree neither to initiate nor to reopen any disputed matter in
a court proceeding following arbitration but may use the assistance of
the courts only to enforce any arbitration award. Arkados and GDA
shall equally share the out-of-pocket costs of said arbitration,
including the fees for the arbitrator, except that the Arkados and GDA
each shall pay its respective expenses for legal representation and
expert witnesses, if any.
11.8 NOTICES. Any notice or report required or permitted to be given or
made under this Agreement by one of the Parties hereto to the other
shall be in writing, delivered personally or by facsimile (and
promptly confirmed by personal delivery or courier) or courier,
postage prepaid, addressed to such other Party at
13
its address indicated below, or to such other address as the addressee
shall have last furnished in writing to the addressor and shall be
effective upon receipt by the addressee.
Arkados: Arkados, Inc.
000 XX Xxxxxxx 00
Xxxxx Xxxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxx, VP of Engineering
Tel: 000-000-0000 x000
Fax: 000-000-0000
GDA: GDA Technologies, Inc.
0000 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxxxxxxxx
Tel: 000-000-0000
Fax: 000-000-0000
11.9 APPLICABLE LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to
its choice of law or conflict of laws provisions and any applicable
laws of the United States.
11.10 ENTIRE AGREEMENT. This Agreement and Annexes hereto contain the entire
understanding of the Parties with respect to the subject matter
hereof. All express or implied agreements and understandings, either
oral or written, heretofore made are expressly merged in and made a
part of this Agreement. This Agreement may be amended, or any term
hereof modified, only by a written instrument duly executed by both
Parties hereto.
11.11 HEADINGS. The captions to the several Articles hereof are not a part
of this Agreement, but are merely guides or labels to assist in
locating and reading the several Articles hereof.
11.12 INDEPENDENT CONTRACTORS. Arkados and GDA are independent contractors
and relationship between them shall not constitute a partnership or
agency of any kind (subject to GDA acting as sales agent on behalf of
Arkados in the GDA Territory). Neither Arkados nor GDA shall have the
authority to make any statements, representations or commitments of
any kind, or to take any action, which shall be binding on the other,
without the prior written authorization of the Party to do so.
11.13 WAIVER. The waiver by either Party hereto of any right hereunder or
the failure to perform or of a breach by the other Party shall not be
deemed a waiver of any other right hereunder or of any other breach or
failure by said other Party whether of a similar nature or otherwise.
14
11.14 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties have entered into this Agreement as of the
date first set forth above as evidenced by the signatures below of their
authorized representatives. This Agreement is signed in two original copies.
GDA TECHNOLOGIES INC.
By: /s/ Xxxx Xxxxxxxxxxxx
-------------------------
Name: Xxxx Xxxxxxxxxxxx
Title:
ARKADOS INC.
By: /s/ Xxxx Xxxxxxxx
-------------------------
Name: Xxxx Xxxxxxxx
Title: President and CEO
15
ANNEX - A TASKS AND DELIVERABLES
--------------------------------
1. DEFINITIONS
1. "ARK-DE" shall mean Arkados deliverable
2. "GDA-DE" shall mean GDA deliverable
3. "ARK-TS" shall mean Arkados task.
4. "GDA-TS" shall mean GDA task.
5. "Joint-DE" shall mean a joint deliverable for Arkados and GDA.
6. "Joint-TS" shall mean a joint task for Arkados and GDA.
7. "Third-TS" shall mean a task performed by a Third party
8. "Foundry-TS" shall mean a task performed by Foundry
2. SPEC. DEFINITION ESTIMATED COMPLETION DATE *
*
System requirement and spec should cover * Arkados' document should cover
the Arkados provided IPs. GDA's document should cover the *
3. CODING/VERIFICATION ESTIMATED COMPLETION DATE *
*
4. GATE LEVEL CREATION ESTIMATED COMPLETION DATE_*
*
GDA will deliver * to Arkados as the task is finished. Note that Foundry IP is
encrypted and cannot be delivered.
5. PHYSICAL LAYOUT
*
Design reports will be delivered where appropriate. *
6 FABRICATION ESTIMATED COMPLETION DATE * **
*
** The * date is subject to change depending on the available * shuttle dates. *
16
7. POST SILICON ESTIMATED COMPLETION DATE * ***
*
*** Note that this date is subject to change depending on the * shuttle dates as
mentioned previously.
Reports will be delivered where appropriate.
8. ENGINEERING CHANGE
Engineering Change happens when partial circuit modification is needed for any
reasons. Part or all of the above flow may be run through depending on the scale
of modification. Also depending on the negotiation with Foundry, some wafers may
need to be held on contract to enhance the modification schedule at the initial
stage of the product.
All changes must go through GDA's Change Control Board and the cost and schedule
impacts if necessary will be negotiated by Parties in good faith.
17
ANNEX - B PRELIMINARY SPECIFICATIONS
------------------------------------
1 HOMEPLUG TECHNOLOGY OVERVIEW
------------------------------
HomePlug technology is used to transport data across AC power lines.
Despite the obvious difference in the transport medium it uses, HomePlug devices
provide the same network interface, and functionality as devices that use common
mediums, such as twisted pair networks.
A HomePlug device is comprised of a Physical(PHY) layer and Medium Access
Control(MAC) layer. These layers provide the services of layers 1 and 2 in the
OSI Reference Model. HomePlug was designed to adhere the OSI model so that its
interface is compatible to other similar standards such as 802.3 and 802.11. It
is also designed to support bridging to these, and other network types.
Using the OSI model, a HomePlug device is used as follows:
Layer 3 - Network Layer Layer 3 - Network Layer
Ethernet Ethernet Ethernet Ethernet
Data Packet Data Packet
HomePlug Device HomePlug Device
Layer 1/2 Layer 1/2
HomePlug HomePlug HomePlug HomePlug
Protocol Packet Protocol Packet
Ethernet Ethernet
Data Data
HomePlug HomePlug
Powerline Protocol Packet Powerline
Ethernet
Data
In the OSI model, data is transferred between layers. A HomePlug device
interfaces to the Network Layer, Layer 3, as shown above. When a device receives
an Ethernet packet from the Layer 3 protocol, it is responsible for transporting
it across the power line, and delivering it to the Layer 3 protocol at the
destination. This is done in a manner that preserves the integrity of the
Ethernet packet so that it is delivered to the destination in exactly the same
condition that it was received in at the source. The
18
mechanism that HomePlug uses to transport the data is essentially invisible to
the Layer 3 protocol(1).
One of the responsibilities of the HomePlug protocol is to transport data
across the power line with a reliability that is near that of a wired data
network. As unstable as the power line is for data communication, the HomePlug
protocol is well suited for sustaining reliable communications.
An Ethernet packet presented to a HomePlug device for transmission is
encapsulated within one or more HomePlug packets. Each HomePlug packet contains
some protocol related overhead information. This information contains address
and control data that is used by the protocol to reliably transport the Ethernet
data across the power line.
Several methods are used to deliver an Ethernet packet to the destination.
Depending on the data rate that the power line can currently sustain, and the
size of the data presented, an Ethernet packet may be segmented into smaller
pieces. These smaller pieces are then placed into multiple HomePlug packets to
ensure that the entire Ethernet packet can be delivered to the destination.
If a HomePlug packet fails to reach its destination, the protocol will
follow a retransmission procedure in an attempt to deliver the packet. This
procedure may include segmenting the Ethernet packet into even smaller HomePlug
packets. Some other methods used to ensure delivery are Xxxx-Xxxxxxx forward
error correction and data redundancy techniques.
HomePlug technology provides a conduit for transporting data through a
network medium. This function is no different than technology that transports
data through a twisted pair medium, or through a wireless medium. 802.3 uses
twisted pair, 802.11 is wireless, HomePlug uses the power line.
-------------------
(1) In theory, HomePlug is invisible at Layer 3. *
19
2 ARKADOS'S POWERLINE COMMUNICATION CHIP
----------------------------------------
The* and a minimum of external components including an analog front end make a
complete system. The device can be used to build a variety of PLC end products.
Examples of a few in home applications are shown below:
--------------------------------------------------------------------------------
In home AC
--------------------------------------------------------------------------------
Powerline
Enikia Endpoint USB Computer Enikia enabled PC
USB to USB Scanner PHY emulation to PLC
PLC
Kid's Bedroom Master Bedroom
--------------------------------------------------------------------------------
In home AC
--------------------------------------------------------------------------------
Powerline
Enikia Enikia Endpoint Enikia Endpoint
Print Sevice ECP Bluetooth to Laptop Ethernet to DSL/Cable Modem
Via PLC PLC (Residential Gateway)
PLC
Family Room Living Room
--------------------------------------------------------------------------------
These examples represent a few of the many possible applications. Each depicts
one of a multitude of different implementations and they are provided only to
enhance understanding of the * device. A block diagram of our chipset is shown
below:
20
*
Based on preliminary analysis, our * will have the following die size and
utilization breakdown:
Total Die Size: *
--------------------------------------------------------- -------------------
Block Percent Utilization
========================================================= ===================
* *
--------------------------------------------------------- -------------------
* *
--------------------------------------------------------- -------------------
* *
--------------------------------------------------------- -------------------
* *
--------------------------------------------------------- -------------------
* *
--------------------------------------------------------- -------------------
* *
--------------------------------------------------------- -------------------
* *
--------------------------------------------------------- -------------------
* *
--------------------------------------------------------- -------------------
* *
--------------------------------------------------------- -------------------
* *
--------------------------------------------------------- -------------------
* *
--------------------------------------------------------- -------------------
21
3 ARKADOS'S POWERLINE COMMUNICATION CHIP - BUDGETARY PRODUCTION COST
--------------------------------------------------------------------
*
4 BOARD-LEVEL DESIGN
--------------------
..
Arkados chipset based design offers the following benefits:
- Lower level of product complexity
- Lower overall system cost
- High level of programmability
- It is suitable for vide range of applications
*
22
ANNEX - C INITIAL TASK ORDER
----------------------------
Dated _________________
1. STATEMENT OF WORK - DESIGN SERVICES
2. STATEMENT OF WORK - PRODUCTION SERVICES
23
ANNEX - D STEERING COMMITTEE MEMBERS
------------------------------------
1. Arkados
Xxxx Xxxxxxxx
VP of Engineering
2. GDA
Xxxx Xxxxxxxxxxxx
24
ANNEX - E ARKADOS DELIVERABLES
------------------------------
None.
25
