Exhibit 10.5
MEMORANDUM OF UNDERSTANDING
This Memorandum of Understanding ("MOU"), entered into as of the 2nd
day of September 1998, by and between General Instrument Corporation ("GI") and
WorldGate Communications, Inc. hereinafter, ("WorldGate"), sets forth certain
understandings between GI and WorldGate with respect to WorldGate's plans to
adapt its television-based Internet access application to permit such
application to operate on GI-designated advanced analog and digital terminals.
1. SCOPE OF MOU
A. WorldGate has developed a television-based Internet access application
and service (the "Application") which it would like to deploy on
certain of GI's advanced analog and digital terminal models (the "GI
Terminals").
B. In connection with deploying the Application on the GI Terminals,
WorldGate has requested GI (i) to sell to WorldGate certain equipment,
(ii) to provide to WorldGate GI's assistance to design and develop
certain hardware and software and (iii) to perform such other services
as required for such deployment on the GI Terminals and as agreed by
the parties, all as further described in the attached Exhibit A (the
"WorldGate Projects").
C. GI agrees to support the efforts of WorldGate with respect to the
WorldGate Projects and the deployment of the Application on the GI
Terminals, by:
1. providing technical information that GI normally provides to
independent hardware and software developers to enable
applications to interface with the GI Terminals,
2. providing engineering consulting support to WorldGate in
connection with the WorldGate Projects,
3. beginning and continuing, with reasonable diligence,
the world necessary to modify the design of the GI
Terminals and to develop an interface (the "GI
Interface") so that the GI Terminals can accommodate
the WorldGate Application, and
4. providing technical support to certify that the
addition of the WorldGate Application to the GI
Terminals does not affect or alter the published
functionality and specifications of the GI Terminals.
D. The parties understand and agree that both GI and WorldGate will incur
significant expense with respect to the project described herein and
the support described in the preceding paragraph.
E. Within not more than ninety (90) days from the date of this MOU, GI
and WorldGate will (i) agree on the priority of the listed WorldGate
Projects and a detailed milestone
schedule for the completion of the WorldGate Projects determined by
the parties to have a high priority, (ii) determine any other business
and legal terms that are necessary for the completion of such work, as
well as the marketing of the Application and (iii) use all
commercially reasonable efforts to finalize and execute a definitive
agreement which will incorporate such business and legal terms (the
"Definitive Agreement"), with such Definitive Agreement to cover the
agreed high priority projects on a project by project basis.
2. OBLIGATIONS OF THE PARTIES. The parties agree that the provisions of
this MOU are binding obligations, except for Section 7 of this MOU which is
non-binding and reflects only a statement of the intentions of the parties with
respect to the matters addressed therein and does not constitute a binding
obligation. The parties covenant never to contend to the contrary. Neither party
shall make a claim against, or be liable to, the other party or its affiliates
or agents for any damages, including without limitation, lost profits or injury
to business reputation, resulting from the continuation or abandonment of
negotiations or the development work described in this MOU, including the
consequences thereof.
3. REIMBURSEMENT OF GI'S COSTS AND EXPENSES. The parties acknowledge that
this MOU is executed so that GI may determine the feasibility of and begin the
design and engineering work necessary to (I) accomplish the WorldGate Projects
and (ii) qualify the Application to run on the GI Terminals (collectively, the
"Preliminary Work"). [REMAINDER OF PARAGRAPH REDACTED.]##
4. DISCLAIMER. Neither party guarantees or makes any representation or
warranty that it will successfully complete the WorldGate Projects. Either party
is free at any time to redesign its existing or future equipment, hardware
and/or software, without any obligation to ensure that such redesigned
equipment, hardware and/or software will support or be compatible with the other
party's equipment, hardware and/or software.
5. DISCLOSURE/COOPERATION. The Parties have entered into an Application
Certification and Support Agreement dated as of November 14, 1997, as
supplemented by the Letter Agreement dated November 14, 1997, which agreements
contain confidentiality provisions which currently govern the disclosure of
confidential information by the parties. The parties hereby reaffirm the
applicability of such confidentiality provisions to the disclosures of
confidential information and activities addressed in this MOU. The parties will
reasonably cooperate with respect to disclosure of information (which may
include providing prototypes of the WorldGate Application and/or the GI
Terminals) necessary to enable the parties to perform their obligations
hereunder and under the Definitive Agreement. Any changes by WorldGate to its
Application, and any changes by GI to the GI Terminals will be immediately
communicated to the other party in the event such changes impact the services to
be performed hereunder.
__________________________
## THE INFORMATION CONTAINED IN THIS PORTION OF THE EXHIBIT HAS BEEN OMITTED AND
FILED SEPARATELY WITH THE SECURITIES & EXCHANGE COMMISSION PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT.
6. INTELLECTUAL PROPERTY RIGHTS.
(a) The parties agree to use all commercially reasonable efforts to
negotiate and in good faith finalize in the Definitive Agreement the
ownership and licensing rights with respect to any Intellectual
Property developed or used in connection with the completion of the
WorldGate Projects. Notwithstanding the foregoing, no right, title or
interest in any of GI's existing Intellectual Property is granted to
WorldGate under this MOU and no right, title or interest in any of
WorldGate's existing Intellectual Property is granted to GI under this
MOU.
(b) For purposes of this paragraph, the term "Intellectual Property" shall
mean all patents, copyrights, mask works, trademarks and trade secrets,
including without limitation any ideas, inventions, know-how,
techniques, methods, designs and processes, whether or not patentable.
7. MARKETING. The Parties intend to reasonably cooperate with each other
in implementing a marketing plan for promoting the Application and the GI
Terminals.
8. RELATIONSHIP BETWEEN THE PARTIES/NON-EXCLUSIVITY. Nothing contained in
this MOU shall be construed or interpreted to the effect that the parties hereto
have established or intend to establish any form of corporate association,
agency or partnership. This MOU and any action taken pursuant to the terms and
conditions hereof shall not obligate either party to enter into any further
business relationship. Except as otherwise agreed in writing by the parties, the
parties hereto agree that either party may meet, exchange information, enter
into agreements and conduct business relationships of any kind with third
parties, to the exclusion of the other party hereto relating to activities
described in this MOU. Except as otherwise agreed to in writing by the parties,
the provisions of this MOU shall not serve to impair the right of either party
to develop, make, use, procure, and/or market products or services now or in the
future that may be competitive with those offered by the other, nor to develop
and provide products to competitors of the other party, nor require either party
to disclose any planning or other information to the other. Neither party has
made any commitment to the other regarding the consummation of any proposed
business relationship and, except as otherwise provided in this MOU, each party
will bear its own costs and expenses in connection with this MOU whether or not
such a relationship is consummated.
9. PUBLICITY. Neither party shall publicly announce or disclose the terms
or conditions of this MOU, or advertise or release any publicity regarding this
MOU or the activities hereunder, without the prior written consent of the other
party. This provision shall survive the expiration, termination or cancellation
of this MOU.
10. COUNTERPARTS. This MOU may be executed in two (2) or more counterparts,
and by each party on the same or different counterparts, buy all of such
counterparts shall together constitute one and the same instrument and
understanding of the parties hereto.
11. GOVERNING LAW. This MOU shall be governed and construed in accordance
with the
laws of the Commonwealth of Pennsylvania, without application of conflict of
laws principles, and the parties hereby agree to submit to the jurisdiction of
all federal and state courts within the Commonwealth of Pennsylvania.
This MEMORANDUM OF UNDERSTANDING is executed as of the date first set forth
above by authorized representatives of the parties hereto.
WORLDGATE COMMUNICATIONS, INC.
By: /s/ X. X. Xxxx
Name: Xxxxx X. Xxxx
Title: CFO
Date: September 2, 1998
GENERAL INSTRUMENT CORPORATION
By: _____________________________________
Name: Xxxxxxx X. Xxxxx
Title: Executive Vice President
Date: September 2, 1998
laws of the Commonwealth of Pennsylvania, without application of conflict of
laws principles, and the parties hereby agree to submit to the jurisdiction of
all federal and state courts within the Commonwealth of Pennsylvania.
This MEMORANDUM OF UNDERSTANDING is executed as of the date first set forth
above by authorized representatives of the parties hereto.
WORLDGATE COMMUNICATIONS, INC.
By: _____________________________________
Name:
Title:
Date: September 2, 1998
GENERAL INSTRUMENT CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Executive Vice President
Date: September 2, 1998
EXHIBIT A
WORLDGATE / GI DNS STATEMENT OF WORK
7/13/98
PROJECT TARGET SCHEDULE ESTIMATED COST
------- --------------- --------------
CERTIFICATIONS
-GI will certify WG commercial release versions to schedule GI ## ##
releases [REMAINDER REDACTED]##
DEVELOPMENT SUPPORT
-Support of WG application utilizing scheduled GI release ##
enhancements [TEXT REDACTED]## onto the following platforms:
-DCT 1000 ##
-DWT 1000
-DCT 2000
-DVI 2000
-DCT 5000
**All dates referenced are based on current GI schedules and are subject to
change at GI discretion. Change in dates for deliverables stated or implied can
occur at discretion of either party with written notice. Costs are estimates and
based on projected statement of work and milestone/deliverables for each project
yet to be finalized. Timeline change, feature set modification, hardware
changes, etc. can impact price estimates. GI will notify Worldgate of pricing
changes in writing prior to project start date.
______________________________
## THE INFORMATION CONTAINED IN THIS PORTION OF THE EXHIBIT HAS BEEN OMITTED AND
FILED SEPARATELY WITH THE SECURITIES & EXCHANGE COMMISSION PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT.
PROJECT (continued) TARGET SCHEDULE ESTIMATED COST
------- --------------- --------------
CERTIFICATIONS
-Integration and test of WG application to scheduled release ##
enhancements [INFORMATION REDACTED]## onto the following platforms. Assumes 1
major integration and test effort per official quarterly release:
-DCT 1000 ##
-DWT 1000
-DCT 2000
-Dvi 2000
-DCT 5000
-Support of WG development of the following projects:
[INFORMATION REDACTED]## ## ##
-Integration and test of WG development of the following projects: ## ##
[INFORMATION REDACTED]##
HARDWARE
-GI will provide WG with DNS hardware necessary for WG development
and test purposes in quantities and products agreed upon by both ## ##
parties, as well as DNS equipment necessary for demonstration purposes
(purchase/loan).
TOTAL PROJECT FINDING ##
____________________________
## THE INFORMATION CONTAINED IN THIS PORTION OF THE EXHIBIT HAS BEEN OMITTED AND
FILED SEPARATELY WITH THE SECURITIES & EXCHANGE COMMISSION PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT.
WORLDGATE / GI ANS STATEMENT OF WORK
7/30/98
ESTIMATED
PROJECT TARGET SCHEDULE COST
------- --------------- ---------
CERTIFICATIONS
-GI will certify WG commercial release versions to:
-scheduled GI releases ## ##
-WG cost reduction programs
-Third Party applications
DEVELOPMENT SUPPORT
-Design support of both current and future implementations of
the WG application to scheduled release enhancements of the CFT
2200 with the following vide standards
[INFORMATION REDACTED]## ## ##
-Integration and test of both current and future implementations
of the WG application to scheduled release enhancements of the CFT
2200 with the following video standards:
## ##
[INFORMATION REDACTED]##
-Support, integration
and test of the WG application to the following set top platforms:
[INFORMATION REDACTED]## ## ##
HARDWARE
-GI will provide WG with ANS hardware necessary for WG development, ## ##
test and trial purposes in quantities and products agreed upon by
both parties, as well as ANS equipment necessary for
demonstration purposes (purchase/loan).
TOTAL PROJECT FUNDING ##
-----------------------
## THE INFORMATION CONTAINED IN THIS PORTION OF THE EXHIBIT HAS BEEN OMITTED
AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
A REQUEST FOR CONFIDENTIAL TREATMENT.
