XXXXX & XXXXXXXXXX COMPUTER CORPORATION
INITIAL LICENSE AGREEMENT
THIS INITIAL LICENSE AGREEMENT ("Agreement") is made and entered into
as of August 31, 2001 (the "Effective Date") by and between XXXXX & XXXXXXXXXX
COMPUTER CORPORATION ("E&S"), a Utah corporation, and REALVISION, INC., a
Japanese corporation ("RealVision"), each having an office for the conduct of
business at the addresses indicated below (E&S and RealVision are hereinafter
referred to individually as a "party" and collectively as the "parties").
1. PURPOSE AND DEFINITIONS
1.1 Purpose of this Agreement. This Agreement is entered into under
Section 1.02 of the Asset Purchase and Intellectual Property License Agreement,
dated as of August 31, 2001, between E&S and RealVision ("Asset Purchase
Agreement").
1.2 Definitions.
(a) "Asset Purchase Agreement" is defined in Section 1.1
(b) "Attachments" means attachments, schedules, exhibits
and addenda to this Agreement describing the Licensed Product,
Documentation and any special terms and conditions pertaining
hereto.
(c) "Binary Code" means machine-readable, executable or
binary computer code.
(d) "Confidential Information" means information (i)
disclosed in tangible form that is clearly marked or identified as
confidential or proprietary at the time of disclosure or (ii)
disclosed in non-tangible form, identified as confidential or
proprietary at the time of disclosure, and summarized sufficiently
for identification and designated as confidential in a written
memorandum sent to the receiving party within thirty (30) days after
disclosure. Confidential Information may include information of
third parties. The terms and conditions of this Agreement shall be
considered Confidential Information. Source Licensed Product is E&S
Confidential Information.
(e) "Derivative Work(s)" means a work which is based
upon the Licensed Product, or any portion thereof, such as a
revision, modification, port, translation, abridgment, condensation,
expansion, collection, compilation, or any other form in which the
Licensed Product or portion thereof may be recast, transformed or
adapted, and which, in the absence of this Agreement or other
authorization by E&S, would constitute a copyright infringement.
(f) "Documentation" means the manuals, guides, or other
documentation provided for use with the Licensed Product, if any, as
are more fully described in Attachment A hereto.
(g) "Intellectual Property Rights" means all world-wide
patents and patent rights (including design patents), copyrights and
copyright registrations, moral rights, trade secrets, trademarks and
service marks, trademark and service xxxx registrations, and
goodwill pertaining to trademarks and service marks.
(h) "License Term" is defined in Section 2.
(i) "Licensed Product(s)" means (i) the programs and
databases more particularly described in Attachment 1 hereto, and
(ii) all inventions and other Intellectual Property Rights which are
expressed, incorporated or embodied therein or disclosed thereby.
(j) "Licensed Trademarks" means all trademarks and
rights and interests which are capable of being protected as
trademarks (including trademarks, service marks, designs, logos,
indicia, trade names, corporate names, company names, business
names, fictitious business names, trade dress, trade styles, URL
designations and other source or business identifiers, and
applications pertaining thereto), and all registrations and
applications for registration in all countries of the world with
respect to such trademarks, rights or interests, which are listed in
Attachment B and that are owned or controlled by E&S or any of its
Subsidiaries, to the extent that they have the right to grant
licenses within and of the scope set forth herein without the
requirement to pay consideration to any third party (other than
employees of E&S or its Subsidiaries) for the grant of a license
under this Agreement, and the goodwill associated therewith.
(k) "Ri5000 Chipset" means the Ri5000 graphics
controller chip and the GE5000 geometry chip, together with any
enhanced or modified version thereof.
(l) "Source Code" means a series of instructions or
program statements written in a high-level computer language. Source
Code is normally readable by persons trained in the particular
computer language in question, and is normally translated into
machine-executable binary or object code by means of a compiler,
assembler, or interpreter.
(m) "Source Licensed Product" means Source Code for the
Licensed Product.
(n) "Subsidiary" means any corporation, partnership or
other entity, now or hereafter, (i) at least fifty percent (50%) of
whose outstanding shares or securities entitled to vote for the
election of directors or similar managing authority is directly or
indirectly owned or controlled by a party hereto, or (ii) that does
not have outstanding shares or securities but at least fifty percent
(50%) of whose ownership interest representing the right to make the
decisions for such entity is directly or indirectly owned or
controlled by a party hereto; provided, however, that in each case
such corporation, partnership or other entity shall be deemed to be
a Subsidiary only so long as such ownership or control exists and is
at least fifty percent (50%).
2. License term
The License Term shall begin on the Effective Date and expire on the
Closing Date (defined in the Asset Purchase Agreement), unless sooner terminated
under Section 8.
3. SOURCE CODE LICENSE
3.1 License Grant. Subject to the terms and conditions herein,
including the limitations in Section (d), E&S hereby grants to RealVision, and
RealVision accepts, a non-exclusive, nontransferable, worldwide license during
the License Term:
(a) to copy, use, modify and prepare Derivative Works of
the Source Licensed Product for the sole purpose of developing
applications, including driver software, to operate on or with
hardware that incorporates the Ri5000 Chipset,
(b) to copy, distribute, perform and sublicense to end
users, in Binary Code form only, the applications so developed from
Source Licensed Product through all its channels of distribution,
including resellers, OEMs and VARs,
(c) to copy, modify, prepare Derivative Works of and
redistribute Documentation provided with the Licensed Product, and
(d) to use the Licensed Trademarks solely in sales and
marketing of RealVision products relating to advance product
information; provided that (i) all such sales and marketing
materials prominently identity the Licensed Trademarks as trademarks
of E&S and are used with permission and (ii) Item 5 on Attachment B
shall remain within the control of E&S until the Closing Date. The
Licensed Trademarks will not be used in any manner that disparages
the good will in such marks. All good will from such uses will inure
exclusively to the benefit of E&S.
3.2 Limitation on Use.
(a) The license granted herein shall be used by
RealVision only in the development, sale and license of products
that operate on or with hardware that incorporates the Ri5000
Chipset.
(b) The Licensed Product may not be sublicensed to third
parties, other than end users as provided in Section 3.1(b).
(c) The content of Documentation designated in
Attachment A as "Not Restricted" may be disclosed to third parties
without limitation; the content of Documentation designated
"Proprietary" may be disclosed to third parties under written
obligations of confidentiality and non-disclosure comparable to
those in Section 9; and the content of Documentation designated
"Restricted" may be disclosed only to RealVision employees who have
a need to know the specific information in question, and may not be
disclosed to third parties.
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3.3 No Other Rights. No other rights are granted hereunder, by
implication, estoppel, statute or otherwise, except as expressly provided
herein. Nothing in the license granted herein or otherwise contained in this
Agreement shall expressly or by implication, estoppel or otherwise give
RealVision any right or license in other E&S Intellectual Property which now
exists or is subsequently developed, other than as contemplated in Section 5.
3.4 Use by End Users. RealVision agrees to indemnify, defend, and
hold E&S harmless for, from, and against any claims, damages, or litigation
costs resulting from or relating to the distribution or use of Licensed Product,
or applications or products developed from Licensed Product, by third parties
claiming through RealVision, regardless of the form of the action.
4. INSPECTION OF Ri5000 source code
4.1 Conditions of Disclosure. E&S will disclose to RealVision the
HDL Verilog Source Code for the Ri5000 Chipset on the following terms and
conditions:
(a) the disclosure(s) will take place only on E&S's
premises at mutually agreed times;
(b) the disclosure will be to specified RealVision
employees;
(c) no notes, abstracts or summaries of the Source Code
disclosed may be made; and
(d) the disclosure is for the sole purpose of
engineering familiarization with the design of the Ri5000 Chipset,
and no other use may be made of the disclosed Source Code, whether
or not for any commercial or non-commercial purpose, until the
Closing Date as defined in the Asset Purchase Agreement.
4.2 Delivery of Source Code. Upon receipt by E&S of the Second
Payment (defined in the Asset Purchase Agreement), E&S will deliver a copy of
the Ri5000 Chipset Source Code to RealVision, which copy may be used at
RealVision's principal place of business for the purposes stated in Section
4.1(d). RealVision may use, modify and prepare Derivative Works of the Source
Code, but may not make, have made, distribute or sell or offer to sell products
incorporating the Source Code or Derivative Works of the Source Code.
4.3 Confidentiality. The Ri5000 Chipset Source Code disclosed is E&S
Confidential Information, and its use and disclosure is subject to the
provisions of Section 9 hereof, except that further disclosure of the Source
Code to third parties is expressly prohibited.
5. support
Engineering support for the Licensed Product will be provided to
RealVision under the Asset Purchase Agreement, and this Agreement imposes no
additional duty or obligation on E&S to provide corrections, bug fixes, updates,
upgrades, revisions or improvements to Licensed Product.
6. OWNERSHIP
6.1 Ownership of the Licensed Product. E&S owns and will retain all
rights, title and interests, including but not limited to Intellectual Property
Rights, in and to the Licensed Product and Documentation, and in algorithms,
know-how, ideas, techniques, procedures and concepts embodied therein.
6.2 Ownership of Modifications. Each party shall own all rights,
title, and interests, including but not limited to copyrights, patents, patent
rights, trade secrets and other intellectual property rights, in and to any
modifications or improvements of the Licensed Technology, including Inventions
and Derivative Works, made, created or developed by or for such party
independently of the other party. Such modifications or improvements shall not
be deemed co-developed or made or developed jointly, or to be joint work or
jointly owned, by reason of this Agreement or the use or incorporation of all or
portions of the Licensed Technology in such modification or improvement. Neither
party obtains by this Agreement any rights, title, or interests, including but
not limited to intellectual property rights, in the modifications or
improvements of the other party. Neither party has any obligation to disclose or
license such modifications or improvements. RealVision does not obtain any
rights, title or interests, including but not limited to intellectual property
rights, in Derivative Works, other than the license conferred in Section 3 and
as expressly stated in this Section 6.2.
7. ATTRIBUTION
Products and software code distributed by RealVision which are based
upon or incorporate Licensed Technology shall contain appropriate markings
identifying pertinent Licensed Patents, Licensed Copyrights and Licensed
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Trademarks. RealVision agrees not to remove or modify any proprietary legends,
identifications, or notices which are embodied in or affixed to the Licensed
Technology, or which are affixed to the Documentation.
8. TERMINATION
8.1 Termination Generally. This Agreement is effective until its
expiration or termination. RealVision may terminate this Agreement and
discontinue use of the Licensed Product upon thirty (30) days written notice to
E&S. If RealVision fails to comply with any of the material terms and conditions
of this Agreement, E&S may terminate this Agreement upon sixty (60) days'
written notice to RealVision specifying any such breach, unless within the
period of such notice, all breaches specified in such notice shall have been
remedied, or unless the breach is one which, by its nature, cannot be fully
remedied in sixty (60) days, but RealVision has undertaken reasonable, good
faith efforts toward remedying the breach within such sixty (60) days, and
continues to use reasonable, good faith and diligent efforts to promptly remedy
the breach. Termination of this Agreement shall not terminate a party's
obligation to pay any amounts due to the other party hereunder and not then
paid.
8.2 Termination for Insolvency. E&S may terminate this Agreement
upon written notice of termination to RealVision given at any time upon or
after:
(a) the filing by RealVision of a petition in bankruptcy
or insolvency not dismissed within ninety (90) days of the filing;
(b) any adjudication that RealVision is bankrupt or
insolvent;
(c) the filing by RealVision of any petition or answer
seeking reorganization, readjustment or arrangement of its business
under any law relating to bankruptcy or insolvency;
(d) the appointment of a receiver for all or
substantially all of the property of RealVision;
(e) the making by RealVision of any assignment for the
benefit of creditors; or
(f) the institution of any proceedings for the
liquidation or winding up of RealVision's business or for the
termination of its corporate charter not dismissed within ninety
(90) days of the institution of the proceedings.
8.3 Returning Confidential Information. All materials containing
Confidential Information of the other party shall be returned to that party
within thirty (30) days after termination of this Agreement.
8.4 Survival. The provisions of Sections 6, 9, 11, 13 and 14 shall
survive any termination of this Agreement.
9. CONFIDENTIAL INFORMATION
9.1 Restrictions. Each party shall hold in confidence, and shall use
solely for purposes of or as provided in this Agreement, any Confidential
Information received by it from the other or derived from Confidential
Information received from the other, and shall protect the confidentiality of
such with the same degree of care that it exercises with respect to its own
information of like import, but in no event less than reasonable care, for a
period of five (5) years from the date of disclosure.
9.2 Exceptions. The obligations of Section 9.1 shall not apply to
any portion of the Confidential information which:
(a) is now or which hereafter through no act or failure
to act on the part of the receiving party becomes generally known in
the computer graphics or simulation industry;
(b) is hereafter furnished to the receiving party by a
third party without obligation to keep such information
confidential;
(c) is independently developed by the receiving party
without the use of the Confidential Information;
(d) is required to be disclosed pursuant to a legal,
judicial or administrative procedure or otherwise required by law;
providing the disclosing party gives the other party notice of the
proposed disclosure with sufficient time to seek relief;
(e) is already in the possession of, or known to, the
receiving party prior to its receipt; or
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(f) is approved for release or use without restriction
by written authorization of an officer of the disclosing party.
Subject to the requirements of Section 3.1(d) and 9.1 hereof, a receiving party
may disclose appropriate portions of Confidential Information to its employees
who have a need to know the specific information in question, and to auditors,
lenders and regulators having a legitimate need or right to know, in which event
the receiving party will make a reasonable effort to minimize the amount of
information disclosed and to cause such persons to maintain the confidentiality
of the information disclosed.
9.3 Injunction. Confidential Information has been and will continue
to be of central importance to the business of a disclosing party, and its
disclosure to or use by others will cause immediate and irreparable injury to
the disclosing party, which may not be adequately compensated by damages and for
which there is no adequate remedy at law. In the event of any actual or
threatened misappropriation or disclosure of Confidential Information, the
receiving party agrees that the disclosing party will be entitled to an
injunction prohibiting such misappropriation or disclosure, and to specific
enforcement of the receiving party's obligations hereunder. The foregoing rights
to an injunction and specific performance will be cumulative and in addition to
every other remedy now or hereafter available to disclosing party in law or
equity or by statute.
10. REPRESENTATIONS AND WARRANTIES
E&S represents and warrants that it has the authority to enter into
this Agreement. Except as so provided, the Licensed Product are licensed "AS
IS," WITHOUT WARRANTY OF ANY KIND.
11. WARRANTY DISCLAIMER
E&S DOES NOT MAKE AND EXPRESSLY DISCLAIMS ANY EXPRESS OR IMPLIED
WARRANTIES INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF DESIGN, MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, AND NONINFRINGEMENT, OR ARISING FROM A COURSE
OF DEALING, USAGE, OR TRADE PRACTICE. E&S DOES NOT WARRANT THAT THE LICENSED
PRODUCT OR ANY OF ITS PARTS WILL BE ERROR FREE, WILL OPERATE WITHOUT
INTERRUPTION, OR WILL BE COMPATIBLE WITH ANY PARTICULAR SOFTWARE OR HARDWARE.
12. Intellectual property RIGHTS indemniTY
12.1 Indemnity. E&S will defend RealVision from any third party
action brought against RealVision to the extent based on a claim that the
Licensed Product, or any part thereof, infringe, misappropriate or otherwise
violate any Intellectual Property Right which is the subject of a governmental
grant, license or registration or is similarly recognized or perfected under
applicable law (but not pending, unregistered, "common law" or otherwise
inchoate rights) and will pay any costs, damages and reasonable attorneys' fees
attributable to such claim that are awarded against RealVision. RealVision will
(a) promptly notify E&S in writing of the claim, (b) grant E&S sole control of
the defense and settlement of the claim and (c) provide E&S with all reasonable
assistance, information and authority required for the defense and settlement of
the claim.
12.2 Exclusions. Section 12.1 does not apply to a claim to the
extent attributable to use of the Licensed Product, or part thereof, in
combination with third party technology, where use of the Licensed Product, or
part thereof, alone is not infringing.
12.3 SOLE REMEDY. THIS SECTION 12 STATES E&S' SOLE OBLIGATION, AND
REALVISION'S EXCLUSIVE REMEDY, FOR ANY THIRD-PARTY CLAIMS OF INFRINGEMENT
ARISING IN CONNECTION WITH THIS AGREEMENT. WITHOUT LIMITING THE GENERALITY OF
THE FOREGOING, E&S HAS NO OBLIGATION PROCURE FOR REALVISION OR CUSTOMERS OF
REALVISION THE RIGHT TO CONTINUE USING, OR TO REPLACE OR MODIFY, ANY LICENSED
PRODUCT THE USE OF WHICH IS SUBJECT TO A TEMPORARY OR PERMANENT INJUCTION.
13. LIMITATION OF LIABILITY
IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY LOST
REVENUES OR PROFITS OR OTHER SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE
DAMAGES ARISING OUT OF THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO LOST
BUSINESS, PROFITS AND WORK STOPPAGES OR DELAYS, EVEN IF THAT PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND REGARDLESS WHETHER ANY REMEDY
SET FORTH HEREIN FAILS OF ITS ESSENTIAL PURPOSE.
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14. GENERAL
14.1 Change of Control. E&S may terminate this Agreement upon thirty
(30) days written notice if there is an assignment or Change of Control by
RealVision, in either case not consented to by E&S. For purposes of this
Agreement, a "Change of Control" shall mean a transaction or a series of related
transactions in which one or more related parties who did not previously own a
majority interest in RealVision obtains a majority interest in such party and,
in the reasonable business judgment of E&S, such change in ownership will have a
material effect on RealVision's business. In the event of such termination, the
rights and licenses granted to RealVision hereunder shall terminate.
14.2 Choice of Law. This Agreement is made under and shall be
governed by and construed in accordance with the laws of the State of Utah,
United States of America (except that the body of law controlling conflict of
laws) and specifically excluding from application to this Agreement that law
known as the United Nations Conventions on the International Sale of Goods.
14.3 Counterparts. This agreement may be executed in one or more
counterparts, each of which will be deemed an original, but all of which
constitute but one and the same instrument.
14.4 Entire Agreement. This Agreement, including all Attachments
hereto, constitutes the entire agreement between the parties with respect to the
subject matter hereof, and supersedes and replaces all prior or contemporaneous
understandings or agreements, written or oral, regarding such subject matter.
This Agreement will be fairly interpreted in accordance with its terms and
without any strict construction in favor or against either party. Unless
otherwise provided herein, this Agreement may not be modified, amended,
rescinded, or waived, in whole or in part, except by a written instrument signed
by the duly authorized representatives of both parties.
14.5 Headings. The headings and captions in this Agreement are used
for convenience only and are not to be considered in construing or interpreting
this Agreement.
14.6 Import and Export Laws. Licensed Product, including without
limitation, technical data, are subject to US export control laws and may be
subject to export or import regulation in other countries. RealVision agrees to
comply with all such laws and regulations, and certifies that neither the
Licensed Product nor any direct product thereof is being or will be exported or
re-exported, directly or indirectly, to any country for which a validated
license is required under US export laws (including but not limited to any
country determined by US export regulatory authorities to be a prohibited
destination) without first obtaining such a validated license. RealVision agrees
to indemnify, defend, and hold E&S harmless for, from, and against any claims,
damages, or litigation costs resulting from or relating to RealVision's failure
to comply with this Section 14.6, regardless of the form of the action.
14.7 Independent Contractor. E&S is an independent contractor to
RealVision. This Agreement will not be deemed to create a partnership, joint
venture or franchise, and neither party is the other's agent, partner, employee
or representative, nor does a party have any authority to bind the other party
to any obligation by contract or otherwise.
14.8 Notices. All notices required hereunder must be in writing and
delivered either in person or by a means evidenced by a delivery receipt, to the
addresses which follow or as otherwise notified in writing, and will be
effective upon receipt:
Xxxxx & Xxxxxxxxxx Computer Corporation RealVision Inc.
000 Xxxxx Xxxxx 0-0-0 Xxxx-Xxxxxxxx
Xxxx Xxxx Xxxx, Xxxx 00000 Xxxxxxx-xx, Xxxxxxxx, 0000000 Xxxxx
Attn: Jan Bjernfalk Attn: _____________________
14.9 No Rights in Third parties. This Agreement is made for the
benefit of the parties, and not for the benefit of any third parties unless
otherwise agreed to by the parties.
14.10 Relationship of the parties. No employees, consultants,
contractors, or agents of one party are agents, employees, franchisees, or joint
venturers of the other party, nor do they have any authority to bind the other
party by contract or otherwise to any obligation. No party will represent to the
contrary, either expressly, implicitly, or otherwise.
14.11 Severability. In the event that any part of this Agreement is
found to be unenforceable, the remainder shall continue in effect, to the extent
consistent with the intent of the parties as of the Effective Date.
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14.12 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with its specific terms or were
otherwise breached. It is accordingly agreed that any party hereto shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions hereof, this being in
addition to any other remedy to which they are entitled hereunder or otherwise.
14.13 US Government Restricted Rights. If RealVision is acquiring
Source Code or Binary Code on behalf of the US Government, the code is provided
with "Restricted Rights," as that term is defined in the Federal Acquisition
Regulations (FARs) in 48 C.F.R 52.227-19(c)(2), or its equivalent in the DOD
Supplement to the FARs (DFARs), and use, duplication or disclosure of the code
is subject to restrictions set forth in FARs and DFARs. Contractor/Manufacturer
is: Xxxxx & Xxxxxxxxxx Corporation, 000 Xxxxx Xxxxx, Xxxx Xxxx Xxxx, Xxxx 00000.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized representatives.
XXXXX & XXXXXXXXXX COMPUTER REALVISION INC.
CORPORATION
BY: /S/ Xxxxx X. Xxxxx BY: /S/ Xxxxxx Xxxxxxxx
--------------------------- ---------------------------
NAME: Xxxxx X. Xxxxx NAME: Xxxxxx Xxxxxxxx
TITLE: President and CEO TITLE: President and CEO
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Attachment a
Licensed PRODUCT
Licensed Product
Source code for REALimage 5000 series graphics controller chip device
driver software, including OpenGL, OpenML, DirectDraw, Direct3D,
Windows-GDI (C-language, C++)
Documentation
Not Restricted
General product marketing documents, including specification sheets
and sales presentations, that have previously been placed in the public domain
by E&S.
Proprietary
Ri5000 Reference board schematics and manufacturing documentation
Any product performance data not in the "Not Restricted" category
Ri5000/Ge5000 Hardware Reference Manual
Ri5000/Ge5000 Programmer's Reference Manual
Sample application programs
Application programming guidelines and documentation
Device Driver application programming interface (API) documentation
Restricted
Documentation for Ri5000 Chipset, including but not limited to:
Internal Device Driver documentation (below API level)
Chip architecture and module descriptions, other than that
contained in Hardware Reference Manuals and Programmer's
Reference Manuals
Other internal engineering design documentation
Ri5000 Chipset source code
Other items constituting the design and verification environment of
the Ri5000 Chipset (as described in Appendix B of the Asset Purchase Agreement)
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Attachment B
Licensed TRADEMARKS
1. REAL IMAGE: U.S. Registration No. 0000000; Japanese Registration No.
4255838
2. REALimage: U.S. Registration No. 2246784; Pending in the European
Community Serial No. 577817; REALimage: Japanese Registration No.
4435392
3. REALIMAGE: WHEN QUALITY MATTERS: Pending in the U.S.; Serial No.
76/077,390
4. STUDIO ON A CHIP: Pending in the U.S.; Serial No. 76/047,684;
Japanese Registration No. 4467478
5. URL/Domain - xxx.xxxxxxxxx.xxx (unregistered trademark)
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