Exhibit 10.2
PATENT LICENSE AGREEMENT
between
LUCENT TECHNOLOGIES GRL CORPORATION
and
COMDIAL CORPORATION
Effective as of January 1, 2000
Relating to Business Communication Systems
PATENT LICENSE AGREEMENT
TABLE OF CONTENTS
ARTICLE I - GRANTS OF LICENSES
1.01 Grant
1.02 Duration
1.03 Scope
1.04 Ability to Provide Licenses
1.05 Joint Inventions
1.06 Publicity
ARTICLE II - ROYALTY AND PAYMENTS
2.01 Royalty Calculation
2.02 Records and Adjustments
2.03 Reports and Payments
ARTICLE III - TERMINATION
3.01 Term
3.02 Breach
3.03 Voluntary Termination
3.04 Survival
ARTICLE IV - MISCELLANEOUS PROVISIONS
4.01 Disclaimer
4.02 Assignability
4.03 Addresses
4.04 Taxes
4.05 Choice of Law
4.06 Integration
4.07 Outside the United States
4.08 Dispute Resolution
4.09 Releases
4.10 Severability
4.11 Modification
APPENDIX A - DEFINITIONS
APPENDIX B - CUSTOMER RELATIONSHIP MANAGEMENT PATENTS
i
PATENT LICENSE AGREEMENT
This Patent License Agreement ("Agreement") is between the following Parties:
LUCENT TECHNOLOGIES GRL CORPORATION, a Delaware corporation ("LUCENT-GRL"),
having an office at Suite 105, 14645 N.W. 00xx Xxxxxx, Xxxxx Xxxxx, Xxxxxxx
00000, and COMDIAL CORPORATION, a Delaware corporation ("COMDIAL"), having an
office at 0000 Xxxxxxxx Xxxxx, Xxxxxxxxxxxxxxx, Xxxxxxxx 00000. This Agreement
is effective on January 1, 2000 (the "Effective Date"). The Parties agree as
follows:*
ARTICLE I
GRANTS OF LICENSES
1.01 Grant
(a) LUCENT-GRL grants to COMDIAL under LUCENT-GRL's PATENTS personal,
worldwide, nonexclusive and non-transferable (except as otherwise provided
for in Section 4.02) licenses for:
LICENSED PRODUCTS
The licenses granted to COMDIAL under this Agreement do not include any
licenses for VOICE PROCESSING PRODUCTS, SPECIALIZED.
(b) COMDIAL grants to LUCENT-GRL under COMDIAL's PATENTS personal,
nonexclusive, worldwide, royalty-free and non-transferable (except as
otherwise provided for in Section 4.02) licenses for:
LICENSED PRODUCTS
1.02 Duration
All licenses granted herein under any patent shall terminate at the earlier
of: (i) termination of such licenses pursuant to Article III; or (ii) the
expiration of the entire unexpired term of such patent. However, upon
commencement of the LIMITED PERIOD or at the time of earliest filing
specified in the definition of LUCENT-GRL's PATENTS or COMDIAL's PATENTS
___________________________
* Any term in capital letters which is defined in the APPENDIX A - DEFINITIONS
shall have the meaning specified therein.
(as the case may be), the grantor has no rights, or less than full rights,
with respect to any of its patents included within such definition, the
license granted herein under such patent shall be for as much of such term
as, and to the maximum extent that, the grantor has the right to grant,
subsequent to commencement of the LIMITED PERIOD, at or after such time of
earliest filing.
1.03 Scope
(a) The licenses granted herein are licenses to (i) make, have made, use,
lease, sell and import LICENSED PRODUCTS; (ii) make, have made, use and import
machines, tools, materials and other instrumentalities, insofar as such
machines, tools, materials and other instrumentalities are involved in or
incidental to the development, manufacture, testing or repair of LICENSED
PRODUCTS which are or have been made, used, leased, owned, sold or imported
by the grantee of such license; and (iii) convey to any CUSTOMER of the
grantee, with respect to any LICENSED PRODUCT which is sold or leased by such
grantee to such CUSTOMER, rights to use and resell such LICENSED PRODUCTS as
sold or leased by such grantee (whether or not as part of a larger
combination); provided, however, that no rights may be conveyed to NON END-USER
CUSTOMERS with respect to any invention which covers (1) a combination of such
LICENSED PRODUCT (as sold or leased) with any other product unless the LICENSED
PRODUCT embodies a significant portion of the invention and the LICENSED
PRODUCT has a fair market value of at least seventy-five percent (75%) of the
total fair market value of the combination as resold by such a NON END-USER
CUSTOMER, (2) a method or process which is other than the inherent use of such
LICENSED PRODUCT itself (as sold or leased), or (3) a method or process
involving the use of a LICENSED PRODUCT to manufacture (including associated
testing) any other product.
(b) Except as otherwise expressly provided in this Agreement, licenses
granted herein are not to be construed either (i) as consent by the grantor to
any act which may be performed by the grantee, or (ii) to include licenses to
contributorily infringe or induce infringement under U.S. law or a foreign
equivalent thereof.
(c) Except as otherwise expressly provided in Section 4.02(c) of this
Agreement, the grant of each license by the grantor hereunder includes the
right to grant sublicenses within the scope of such license to a Party's
RELATED COMPANIES for so long as they remain its RELATED COMPANIES. Any such
sublicense may be made effective retroactively, but not prior to the Effective
Date hereof, nor prior to the sublicensees becoming a RELATED COMPANY of such
Party.
(d) Notwithstanding Section 1.03(c), no right is given to COMDIAL, without
the written consent of LUCENT-GRL, to grant a sublicense to a RELATED COMPANY
of COMDIAL under certain or all of LUCENT-GRL'S PATENTS, if said RELATED
COMPANY was a licensee under said certain or all LUCENT-GRL'S PATENTS for
LICENSED PRODUCTS at any time within a two (2)-year period prior to said
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company becoming a RELATED COMPANY unless, however, said RELATED COMPANY
ceased to be such a licensee solely due to the termination of the relevant
license agreement by lapse of time (as opposed to voluntary termination or
termination by breach).
1.04 Ability to Provide Licenses
(a) It is recognized that certain actions of the Parties to this
Agreement may limit their ability to provide licenses hereunder without
constituting a breach. In particular, (i) prior to the earliest filing of a
patent application disclosing an invention of a Party or its RELATED COMPANY,
such Party or RELATED COMPANY may assign to a third party the title to patents
on such invention, or (ii) prior to the execution of this Agreement, a Party
or its RELATED COMPANY may have limited by contract its ability to provide
licenses hereunder with respect to certain patents or technologies.
(b) A Party's failure to meet any obligation hereunder, due to the
assignment of title to any invention or patent, or the granting of any
licenses, to the United States Government or any agency or designee thereof
pursuant to a statute or regulation of, or contract with, such Government or
agency, shall not constitute a breach of this Agreement.
(c) Each Party represents and warrants that it has all rights (or rights
from third parties) necessary to enter into this Agreement and the power to
grant the rights described in this Agreement.
(d) Either Party may submit to the other Party no more than two (2)
inquiries in writing per calendar year, each inquiry requesting whether up to
ten (10) specifically identified patents fall within the definitions of this
Agreement. The Party to whom such an inquiry is submitted shall, within
twenty (20) business days, respond in writing as to whether each identified
patent is included within COMDIAL's PATENTS (if the recipient of the inquiry
is COMDIAL) or LUCENT-GRL's PATENTS (if the recipient of the inquiry is LUCENT
-GRL).
1.05 Joint Inventions
(a) There are countries (not including the United States) which require
the express consent of all inventors or their assignees to the grant of
licenses or rights under patents issued in such countries for joint inventions.
(b) Each Party shall give such consent, or shall obtain such consent from
its RELATED COMPANIES, its employees or employees of any of its RELATED
COMPANIES, as required to make full and effective any such licenses and rights
respecting any joint invention granted to the grantee hereunder by such Party
and by another licensor of such grantee.
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(c) Each Party shall take steps which are reasonable under the
circumstances to obtain from third parties whatever other consents are
necessary to make full and effective such licenses and rights respecting any
joint invention purported to be granted by it hereunder. If, in spite of such
reasonable efforts, such Party is unable to obtain the requisite consents from
such third parties, the resulting inability of such Party to make full and
effective its purported grant of such licenses and rights shall not be
considered to be a breach of this Agreement.
1.06 Publicity
Nothing in this Agreement shall be construed as conferring upon either Party
or its RELATED COMPANIES or sublicensees any right to include in advertising,
packaging or other commercial activities related to a LICENSED PRODUCT, any
reference to the other Party (or any of its RELATED COMPANIES or sublicensees),
its trade names, trademarks or service marks in a manner which would be likely
to cause confusion or to indicate that such LICENSED PRODUCT is in any way
certified by the other Party hereto or its RELATED COMPANIES or sublicensees.
ARTICLE II
ROYALTY AND PAYMENTS
2.01 Royalty Calculation
(a) In part payment for the grant of rights hereunder by LUCENT-GRL to
COMDIAL and in addition to the fees specified in Section 2.01(b), COMDIAL
shall pay to LUCENT-GRL a non-refundable sum of six hundred fifty thousand
United States dollars (U.S. $650,000.00) of which only one hundred fifty
thousand United States dollars (U.S. $150,000.00) is creditable with respect
to royalties owed under Sections 2.01(b) and 2.03(b) for the calendar year
2000. This payment is due to LUCENT-GRL prior to thirty (30) days after the
EXECUTION DATE.
(b) In partial consideration for the licenses and rights exchanged herein
for the LUCENT-GRL'S PATENTS and for the convenience of the Parties, COMDIAL
has elected to and shall pay to LUCENT-GRL in United States dollars for each
calendar year beginning January 1, 2000, a royalty amount calculated at a
royalty rate of three hundred seventy-five thousandths of one percent (0.375%)
of the consolidated sales of COMDIAL and its RELATED COMPANIES ("Consolidated
Sales") during such calendar year (or portion thereof) during which this
Agreement is in effect, as reported in its Form 10-K for such calendar year
filed with the Securities and Exchange Commission ("SEC"). As an example,
Consolidated Sales for the year 1998 as reported in the SEC Form 10K-405 filed
on March 24, 1999 were one hundred twenty-eight million nine hundred seventy-
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seven thousand U.S. dollars ($128,977,000.00 U.S.). Obligations to pay accrued
royalties shall survive termination of licenses and rights pursuant to Article
III.
(c) When a company ceases to be a RELATED COMPANY of COMDIAL, royalties
which have accrued with respect to such company, but which have not been paid,
shall become payable with COMDIAL's next scheduled royalty payment.
(d) Notwithstanding any other provisions hereunder, royalties shall
accrue and be payable only to the extent that enforcement of COMDIAL's
obligation to pay such royalty would not be prohibited by applicable law.
2.02 Records and Adjustments
(a) LUCENT-GRL will credit to COMDIAL the amount of any overpayment of
royalties made in error which is identified and fully explained in a written
notice to LUCENT-GRL delivered within two (2) years after the due date of the
payment which included such alleged overpayment, provided that LUCENT-GRL is
able to verify the existence and extent of the overpayment.
(b) No refund, credit or other adjustment of royalty payments shall be made
by LUCENT-GRL except as provided in this Section 2.02. Rights conferred by
this Section 2.02 shall not be affected by any statement appearing on any check
or other document, except to the extent that any such right is expressly waived
or surrendered by a Party having such right and signing such statement.
(c) Upon termination of this Agreement or of all the rights and licenses
granted to COMDIAL herein, accrued royalties shall be paid within thirty (30)
days of the date of termination. LUCENT-GRL shall have the right through its
accredited auditors to make an examination, during normal business hours, of
those records that are, under recognized accounting practices, used in the
preparation of SEC filings and that bear upon the amount of royalty payable
hereunder. Adjustment shall be made within sixty (60) days of the completion
of such audit to compensate for any errors or omissions disclosed by such
examination. If the adjustment, if any, reflects an underpayment by COMDIAL
in excess of ten percent (10%) of the amount of royalty payable as determined
by such auditors, COMDIAL shall pay the costs of such audit. Otherwise, the
audit shall be at LUCENT-GRL's expense.
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2.03 Reports and Payments
(a) COMDIAL shall furnish to LUCENT-GRL, simultaneously with its filing
with the SEC, a copy of each Form 10-Q and each Form 10-K filed during the
term of this Agreement. Such copy shall be sent by first class mail, postage
prepaid, to LUCENT-GRL at the address specified in Section 4.03.
(b) The annual royalty amount set forth in Section 2.01(b) shall accrue
upon the recognition of revenues by COMDIAL and/or any of its RELATED COMPANIES
for transactions that would be included in Consolidated Sales and shall be
payable quarterly. Such quarterly royalty amount shall be paid by COMDIAL in
United States dollars to LUCENT-GRL at the address specified in Section 4.03
on or before the date on which COMDIAL files with the SEC its quarterly report
on Form 10-Q (as to the first three (3) quarters of each calendar year) and its
annual report as to the last quarter of each calendar year, beginning with the
Form 10-Q filed by COMDIAL with respect to the second quarter of the calendar
year 2000. For the first three (3) quarters of each calendar year, such
quarterly royalty amount shall be calculated at a royalty rate of three
hundred seventy-five thousandths of one percent (0.375%) of the Consolidated
Sales during such quarter, as reported in the respective Form 10-Q filed by
COMDIAL with the SEC for such quarter. For the fourth quarter of each calendar
year, such quarterly royalty amount shall be an amount equal to a royalty rate
of three hundred seventy-five thousandths of one percent (0.375%) of the
Consolidated Sales during such calendar year, as reported in the respective
Form 10-K filed by COMDIAL with the SEC, less the quarterly royalty payments
made for the prior three (3) quarters of that calendar year. However, the
Parties agree that for their convenience the quarterly royalty payment for the
first quarter of calendar year 2000 shall be one hundred fifty thousand United
States dollars ($150,000.00 U.S.).
(c) Any conversion to United States dollars shall be at the prevailing rate
for bank cable transfers as quoted for the last day of such quarterly period
by leading United States banks in New York City dealing in the foreign exchange
market.
(d) Overdue payments hereunder shall be subject to a late payment charge
for the period of time such payment is delinquent calculated at an annual rate
of one percentage point (1%) over the prime rate or successive prime rates in
effect in New York City during delinquency. If the amount of such charge
exceeds the maximum permitted by law, such charge shall be reduced to such
maximum.
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ARTICLE III
TERMINATION
3.01 Term
This Agreement shall terminate upon termination of the LIMITED PERIOD unless
otherwise terminated pursuant to this Article III. Any partial termination of
rights under this Article III will not affect payments due under Section 2.01.
3.02 Breach
In the event of a breach of this Agreement by either Party, the other Party
may, in addition to any other remedies that it may have, at any time terminate
any or all licenses and rights granted by it hereunder by not less than two
(2) months written notice specifying such breach, unless within the period of
such notice all breaches specified therein shall have been remedied. Exercise
of the right of either Party to terminate any or all rights and licenses
pursuant to this Section 3.02 shall be subject to challenge in accordance with
Section 4.08, in which case the effectiveness of such termination shall be
suspended (and the Parties' obligations shall continue) until determined by
the Dispute Resolution process provided for in Section 4.08 provided, however,
that should the breaching Party fail to meet its royalty obligations, such
termination shall be effective as of such prior written notice of breach.
3.03 Voluntary Termination
By written notice to the other Party, either Party may voluntarily terminate
all or a specified portion of the licenses and rights granted to it hereunder.
Such notice shall specify the effective date (not more than six (6) months
from the giving of said notice) of such termination and shall clearly specify
any affected patent, invention or product.
3.04 Survival
(a) If a company ceases to be a RELATED COMPANY of a Party, licenses and
rights granted hereunder with respect to patents of such company that are
included in LUCENT-GRL's PATENTS or COMDIAL's PATENTS (as the case may be)
shall not be affected by such cessation.
(b) Any termination of licenses and rights of a Party under the provisions
of this Article III shall not affect such Party's licenses, rights and
obligations with respect to any LICENSED PRODUCT made prior to such
termination, and shall not affect the other Party's licenses and rights (and
obligations related thereto) hereunder.
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ARTICLE IV
MISCELLANEOUS PROVISIONS
4.01 Disclaimer
Neither Party nor any of its RELATED COMPANIES makes any representations,
extends any warranties of any kind, assumes any responsibility or obligations
whatever, or confers any right or license by implication, estoppel or
otherwise, other than the licenses, rights and warranties herein expressly
granted.
4.02 Assignability
(a) Each Party has entered into this Agreement in contemplation of personal
performance by the other Party and it is each Party's intention that a transfer
of its grantee's licenses or rights not occur, except as provided for in this
Section 4.02, without the grantor's express written consent.
(b) Except as otherwise provided for in this Agreement, neither this
Agreement nor any licenses or rights hereunder, in whole or in part, shall be
assignable or transferable by either Party (by operation of law or otherwise)
without the other Party's express written consent. Any such purported
assignment or transfer of this Agreement or licenses or rights hereunder by
either Party without the other Party's necessary consent shall be void (without
affecting any other licenses or rights hereunder).
(c) Notwithstanding Sections 4.02(a) and (b), any or all of LUCENT-GRL's
rights, title and interest in this Agreement and any or all licenses and rights
granted to it hereunder may be assigned without COMDIAL's consent to any of its
RELATED COMPANIES at any time and for any reason or to SPINCO (before or after
its divestiture from Lucent Technologies Inc.) or to any successor to all or a
portion of its business that is the subject matter of this Agreement. If
LUCENT-GRL so assigns its rights, the terms of this Agreement shall remain the
same and be enforceable by COMDIAL. If Lucent Technologies Inc. divests a
portion of its business and such divested business continues operation as a
separately identifiable business, then the licenses granted hereunder to
LUCENT-GRL may be sublicensed to such divested separate business without the
consent of COMDIAL, but only (i) until the termination of this Agreement
pursuant to Article III; (ii) to the extent and for the time the divested
business functions as a separately identifiable business, and (iii) for
products and services of the kind provided by the divested business prior to
its divestiture and not to any products or services of any entity which
acquires the divested business. This Section 4.02(c) shall apply regardless
of whether the business is divested by a sale of assets or as a sale of a legal
entity (e.g., sale of a RELATED COMPANY). The sublicensing rights specified
herein shall include any business whose acquisition is after the Effective Date
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of this Agreement, provided the acquisition of such business was not a sham for
the purpose of extending rights to the acquired (and then divested) business.
In particular, the licenses granted hereunder to LUCENT-GRL shall be, solely at
LUCENT-GRL's option, sublicensed to SPINCO upon its divestiture from Lucent
Technologies Inc. provided, however, that the sublicense to SPINCO will not
include those ones of COMDIAL's PATENTS that issue on any application filed
(except those applications having a priority date prior to the EXECUTION DATE)
in any or all countries of the world at any time subsequent to the EXECUTION
DATE.
(d) Notwithstanding Sections 4.02(a) and (b), COMDIAL may assign all of
its rights (except as provided herein) and obligations existing or arising
under this Agreement to any successor to all or a portion of its business that
is the subject matter of this Agreement as the result of an acquisition or
merger, with no further right to assign, which successor shall thereafter be
deemed substituted for, and in lieu of, COMDIAL as a Party hereto, subject to
written acceptance by the assignee, provided that COMDIAL may so assign upon
written notice to LUCENT-GRL if: (i) LUCENT-GRL determines that such
assignment, if made, or anticipation of such assignment, would have or had no
effect on a license arrangement between itself and such successor (or any
entities relating to such successor) in effect at any time within a two
(2)-year period prior to such assignment, (ii) only products made by or for
COMDIAL prior to the acquisition or merger will be licensed under this
Agreement and not products of the acquiring entity, except those products of
the acquiring entity, its parent company, and such parent company's other
SUBSIDIARIES that are equivalent to those products made by or for COMDIAL prior
to such acquisition or merger, and (iii) solely for purposes of Section
1.05(b), 1.06, 3.04(a), and the definition of COMDIAL's PATENTS, RELATED
COMPANIES of COMDIAL shall be deemed to include any parent company of which
the acquiring entity is a SUBSIDIARY and such parent company's other
SUBSIDIARIES as of the effective date of the assignment. If COMDIAL so
assigns its rights, the terms of this Agreement shall remain the same and be
enforceable by LUCENT-GRL. The rights so assigned by COMDIAL will not include
any and all rights and licenses under CUSTOMER RELATIONSHIP MANAGEMENT PATENTS
granted to COMDIAL pursuant to this Agreement.
(e) In the event that COMDIAL assigns such rights and obligations to any
acquiring entity pursuant to Section 4.02(d) ("Assignee"), the provisions of
Sections 2.01(b), 2.02(c) and 2.03(a) and (b) shall not apply and shall be
replaced with the following provisions. The term "Reportable Product" shall
mean (i) any COMDIAL product identical to or equivalent to products whose sale
was included in Consolidated Sales prior to such acquisition or merger and
(ii) any product of the Assignee, of its RELATED COMPANIES, of any parent
company of which the Assignee is a SUBSIDIARY, and of such parent company's
other SUBSIDIARIES, that is equivalent to any such COMDIAL product, whether
or not such a product meets the definition of LICENSED PRODUCT. The term
"Assignee Gross Revenues" shall mean those gross revenues recognized for any
and all Reportable Products.
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2.01(b) For the licenses and rights exchanged herein under LUCENT-GRL'S
PATENTS and for the convenience of the Parties, Assignee has elected to and
shall pay to LUCENT-GRL in United States Dollars a sum calculated at a royalty
rate of three hundred seventy-five thousandths of one percent (0.375%) applied
to quarterly Assignee Gross Revenues recognized for each quarterly period
during which this Agreement is effective for any time, beginning with the
quarterly period during which the assignment of this Agreement by COMDIAL to
Assignee occurs. Royalty shall accrue upon the invoicing of the sale or lease
for any and all such Reportable Products. Upon termination of this Agreement
or of all the rights and licenses granted to COMDIAL herein, accrued royalties
shall be paid within thirty (30) days of the date of termination.
2.02(c) Assignee shall keep full, clear and accurate records with respect to
Assignee Gross Revenues and shall furnish any information which LUCENT-GRL may
reasonably prescribe from time to time to enable LUCENT-GRL to ascertain the
proper royalty due hereunder. Assignee shall retain such records with respect
to Assignee Gross Revenues for at least seven (7) years from the invoicing of
the sale or lease for any and all such Reportable Products. LUCENT-GRL shall
have the right through its accredited auditors to make an examination, during
normal business hours, of all records and accounts bearing upon the amount of
royalty payable to it hereunder. Adjustment shall be made within sixty (60)
days of the completion of such audit to compensate for any errors or omissions
disclosed by such examination. If the adjustment, if any, reflects an
underpayment by COMDIAL in excess of ten percent (10%) of the amount of
royalty payable as determined by such auditors, COMDIAL shall pay the costs
of such audit. Otherwise, the audit shall be at LUCENT-GRL's expense.
2.03(a) Within thirty (30) days after the end of each quarterly period ending
on March 31st, June 30th, September 30th, or December 31st during which this
Agreement is effective for any time, commencing with the quarterly period
during which the assignment of this Agreement by COMDIAL to Assignee occurs,
Assignee shall furnish to LUCENT-GRL at the address specified in Section 4.03
a statement certified by a responsible official of Assignee showing, in a
manner acceptable to LUCENT-GRL, Assignee Gross Revenues.
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2.03(b) Within such thirty (30) days, Assignee shall pay in United States
dollars to LUCENT-GRL at the address specified in Section 4.03 the royalties
payable in accordance with such statement.
4.03 Addresses
(a) Any notice or other communication hereunder shall be sufficiently
given to COMDIAL when sent by certified mail addressed to Comdial Corporation,
0000 Xxxxxxxx Xxxxx, Xxxxxxxxxxxxxxx, Xxxxxxxx 00000, Attention: President,
with a copy to Xxxxxx X. Xxxxxx, c/o McGuire, Woods, Battle & Xxxxxx LLP,
Court Square Building, 000 Xxxxxx Xxxxxx, X.X., Xxxxx 000, Xxxxxxxxxxxxxxx,
Xxxxxxxx 00000 or to LUCENT-GRL when sent by certified mail addressed to
Contract Administrator, Intellectual Property Organization, Lucent
Technologies GRL Corporation, Suite 105, 14645 N.W. 77th Avenue, Miami Lakes,
Florida 33014, United States of America. Changes in such addresses may be
specified by written notice.
(b) Payments by COMDIAL shall be made to LUCENT-GRL at Lucent
Technologies GRL Corporation, General Post Office, X.X. Xxx 0000, Xxx Xxxx,
Xxx Xxxx, 00000-0000, Xxxxxx Xxxxxx of America. Alternatively, payments to
LUCENT-GRL may be made by bank wire transfers to LUCENT-GRL's account at
Chase Manhattan Bank: Lucent Technologies GRL Corporation, Account No.
323857752, Swift Code: XXXXXX00, ABA Code: 000000000. Changes in such
address or account may be specified by written notice.
4.04 Taxes
(a) In anticipation of payments being received from a U.S. corporation
and under current law as of the Effective Date, the Parties do not contemplate
that any taxes (except income taxes), duties, levies, or similar charges will
be imposed as a result of the existence or operation of this Agreement.
However, in the event such charges are imposed, COMDIAL agrees that it shall
bear all such charges (and any related interest and penalties), however
designated, imposed as a result of the existence or operation of this
Agreement, except (i) any tax imposed upon LUCENT-GRL in a jurisdiction other
than the United States if such tax is allowable as a credit against the United
States income taxes of LUCENT-GRL; and (ii) any net income tax imposed upon
LUCENT-GRL by the United States or any governmental entity within the United
States (the fifty (50) states and the District of Columbia). In order for the
exception contained in (i) to apply, COMDIAL must furnish LUCENT-GRL with
evidence issued by the taxing authority in such jurisdiction that such tax has
been paid. The evidence must be furnished within thirty (30) days of issuance
by the taxing authority and must be sufficient to satisfy United States taxing
authorities that such tax has been paid.
(b) If COMDIAL is required to bear a tax, duty, levy or similar charge
pursuant to Section 4.04(a) above, COMDIAL shall pay such tax, duty, levy or
similar charge and any additional amounts as are necessary to ensure that the
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net amounts received by LUCENT-GRL hereunder after all such payments or
withholdings equal the amounts to which LUCENT-GRL is otherwise entitled under
this Agreement as if such tax, duty, levy or similar charge did not apply.
4.05 Choice of Law
The Parties are familiar with the principles of New York law, and desire and
agree that the law of New York (exclusive of its conflict of laws provision)
shall apply in any dispute arising with respect to this Agreement.
4.06 Integration
This Agreement, together with a letter of assurance by Lucent Technologies
Inc. and a letter of assurance by COMDIAL, set forth the entire agreement and
understanding between the Parties as to the subject matter hereof and merges
all prior discussions between them. However, the Parties agree that nothing
herein or in such letters of assurance is intended to bind Lucent Technologies
Inc. in any manner, except as to the truth of the statements in its such
letter. Lucent Technologies Inc. has no obligations or duties pursuant to the
letters of assurance, this Agreement, and the subject matter hereof. Neither
of the Parties shall be bound by any warranties, understandings or
representations with respect to such subject matter other than as expressly
provided herein or in a writing signed with or subsequent to execution hereof
by an authorized representative of the Party to be bound thereby.
4.07 Outside the United States
(a) There are countries in which the owner of an invention is entitled to
compensation, damages or other monetary award for another's unlicensed
manufacture, sale, lease, use or importation involving such invention prior to
the date of issuance of a patent for such invention but on or after a certain
earlier date, hereinafter referred to as the invention's "protection
commencement date" (e.g., the date of publication of allowed claims or the
date of publication or "laying open" of the filed patent application). In some
instances, other conditions precedent must also be fulfilled (e.g., knowledge
or actual notification of the filed patent application). The Parties agree
that (i) an invention which has a protection commencement date in any such
country may be used in such country pursuant to the terms of this Agreement on
and after any such date, and (ii) all such conditions precedent are deemed
satisfied by this Agreement. There may be countries in which a Party hereto
may have, as a consequence of this Agreement, rights against infringers of the
other Party's patents licensed hereunder. Each Party hereby waives any such
right it may have by reason of any third party's infringement or alleged
infringement of such patents.
(b) COMDIAL hereby agrees to register or cause to be registered, to the
extent required by applicable law, and without expense to LUCENT-GRL or any of
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its RELATED COMPANIES, any agreements wherein sublicenses are granted by it
under LUCENT-GRL's PATENTS. COMDIAL hereby waives any and all claims or
defenses, arising by virtue of the absence of such registration, that might
otherwise limit or affect its obligations to LUCENT-GRL.
(c) LUCENT-GRL hereby agrees to register or cause to be registered, to the
extent required by applicable law, and without expense to COMDIAL or any of its
RELATED COMPANIES, any agreements wherein sublicenses are granted by it under
COMDIAL'S PATENTS. LUCENT-GRL hereby waives any and all claims or defenses,
arising by virtue of the absence of such registration, that might otherwise
limit or affect its obligations to COMDIAL.
4.08 Dispute Resolution
(a) If a dispute arises out of or relates to this Agreement, or the breach,
termination or validity thereof, the Parties agree to submit the dispute to a
sole mediator selected by the Parties or, at any time at the option of a Party,
to mediation by the American Arbitration Association ("AAA"). If not thus
resolved, it shall be referred to a sole arbitrator selected by the Parties
within thirty (30) days of the mediation, or in the absence of such selection,
to AAA arbitration which shall be governed by the Federal Arbitration Act.
(b) Any award made (i) shall be a bare award limited to a holding for or
against a Party and affording such remedy as is deemed equitable, just and
within the scope of the Agreement; (ii) shall be without findings as to issues
(including but not limited to patent validity and/or infringement) or a
statement of the reasoning on which the award rests; (iii) may in appropriate
circumstances (other than patent disputes) include injunctive relief; (iv)
shall be made within four (4) months of the appointment of the arbitrator;
(v) may be entered in any court; and (vi) shall be binding.
(c) The requirement for mediation and arbitration shall not be deemed a
waiver of any right of termination under this Agreement but the exercise of
such right is subject to the provisions of Section 3.02. The arbitrator is
not empowered to act or make any award other than based solely on the rights
and obligations of the Parties prior to any such termination.
(d) The arbitrator shall be knowledgeable in the legal and technical
aspects of this Agreement and shall determine issues of arbitrability but may
not limit, expand or otherwise modify the terms of this Agreement.
(e) The place of mediation and arbitration shall be Washington, D.C.
(f) Each Party shall bear its own expenses, except those related to the
compensation and expenses of the mediator and arbitrator which shall be borne
equally.
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(g) A request by a Party to a court for interim measures shall not be
deemed a waiver of the obligation to mediate and arbitrate.
(h) The arbitrator shall not have authority to award punitive or other
damages in excess of compensatory damages and each Party irrevocably waives
any claim thereto.
(i) The Parties, their representatives, other participants and the
mediator and arbitrator shall hold the existence, content and result of
mediation and arbitration in confidence.
4.09 Releases
(a) Subject to Section 4.09(c) and to the receipt by LUCENT-GRL of the
payment by COMDIAL pursuant to Section 2.01(a), LUCENT-GRL, for itself and
for its present RELATED COMPANIES (i.e., RELATED COMPANIES as of the Effective
Date), hereby releases COMDIAL and its present RELATED COMPANIES, all of the
present and former officers and directors of COMDIAL and its present RELATED
COMPANIES, and all CUSTOMERS under any claim that solely LUCENT-GRL or any of
its present RELATED COMPANIES has for patent infringement arising prior to the
Effective Date for which the rights and licenses expressly granted under this
Agreement to COMDIAL and its present RELATED COMPANIES would be a complete
defense to such claim had this Agreement been in effect at the time such
patent infringement arose.
(b) Subject to Section 4.09(c), COMDIAL, for itself and for its present
RELATED COMPANIES, hereby releases LUCENT-GRL and its present RELATED
COMPANIES, all of the present and former officers and directors of LUCENT-GRL
and its present RELATED COMPANIES, and all CUSTOMERS under any claim that
solely COMDIAL or any of its present RELATED COMPANIES has for patent
infringement arising prior to the Effective Date for which the rights and
licenses expressly granted under this Agreement to LUCENT-GRL and its present
RELATED COMPANIES would be a complete defense to such claim had this Agreement
been in effect at the time such patent infringement arose. For the purposes
of this Section 4.09(b), RELATED COMPANIES of LUCENT-GRL also includes Lucent
Technologies Inc. and its SUBSIDARIES as they formerly existed as part of AT&T
Corp.
(c) The releases in Sections 4.09(a) and (b) shall not operate to release
any CUSTOMER of COMDIAL or any of its RELATED COMPANIES who is a party to any
lawsuit involving allegations of patent infringement, patent invalidity or
patent unenforceability in which LUCENT-GRL or any of its RELATED COMPANIES is
an adverse party as of two weeks prior to the EXECUTION DATE.
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4.10 Severability
If any paragraph or provision of this Agreement shall be deemed void or
invalid as a matter of law, the remaining paragraphs or provisions of this
Agreement shall nevertheless remain in full force and effect and be interpreted
to the extent possible to effect the overall intention of the Parties at the
EXECUTION DATE of this Agreement.
4.11 Modification
This Agreement may not be amended, modified or altered in any way, except in a
writing identified as such and signed by both Parties hereto.
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IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed
in duplicate originals by its duly authorized representatives on the respective
dates entered below.
LUCENT TECHNOLOGIES GRL CORPORATION
By:_/s/ G. G. Partlow_____
X. X. Xxxxxxx
Chairman of the Board
Date: March 17, 2000
COMDIAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title:_Chairman/President/CEO
Date:_March 22,2000
THIS AGREEMENT DOES NOT BIND OR OBLIGATE EITHER PARTY
IN ANY MANNER UNLESS DULY EXECUTED BY AUTHORIZED
REPRESENTATIVES OF BOTH PARTIES.
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