PRECISI0N DIGITAL IMAGES CORP.
LICENSE AGREEMENT
This License Agreement ("Agreement") is made and entered into as of the
later of the two dates on the signature page (the "Effective Date") by and
between IAT Multimedia, Inc. ("IAT"), a Delaware corporation, and Precision
Digital Images Corporation ("PDI"), a Washington corporation.
Recitals
WHEREAS, PDI has developed an ASIC that is an important component of a
product designed by IAT; and
WHEREAS, PDI and IAT have expressed a desire to work together to jointly
produce this ASIC; and
WHEREAS, pursuant to this Agreement, PDI is willing to grant to IAT a
license to produce the ASIC pursuant to the terms and conditions contained
herein; and
WHEREAS, pursuant to an ASIC Development Agreement, between the parties
hereto and dated as of the date of this Agreement, PDI is willing to perform
certain services relating to the development of the ASIC;
NOW, THEREFORE, in consideration of the covenants and conditions
hereinafter set forth, PDI and IAT agree as follows:
AGREEMENT
1. Definitions. For purposes of this Agreement, the following terms,
whenever initially capitalized, shall have the following meanings:
(a) "ASIC" means the application specific integrated circuit chip
designed by PDI as described in Exhibit A attached hereto.
(b) "ASIC Derivatives" means any application specific integrated circuit
chip derived from any of the major functional components of the ASIC in a
stand-alone chip.
(c) "Design Documents" means the Veritog (HDL) files, script files, test
modules and any other files or documentation required to manufacture the ASIC.
(d) "Licensed Technology" means any Design Documents, information and data
of PDI (whether confidential or not) which is necessary and sufficient to
modify, improve, enhance, manufacture, assemble, test, operate, maintain and
repair ASIC products and parts,
and which is now or hereafter owned, controlled or possessed by PDI, including,
without limitation, invention records, research records and reports, flow
charts, state diagrams, logic diagrams, block diagrams, development reports,
experimental and other engineering reports, circuits, xxxx of materials,
production specifications, raw material specifications, quality control reports
and specifications, drawings and photographs, manufacturing and production
techniques, processes, methods, test information, software (including source
and object code listings and supporting documentation), repair and maintenance
procedures, manuals, basic process steps, vendor lists or any other information
possessed by PDI.
All other initially capitalized terms shall have the meanings hereinafter
assigned to them.
2. License Grant. PDI hereby grants to IAT, and IAT hereby accepts, a non-
exclusive, non-transferable, non-assignable, royalty free (except as stated in
Exhibit B), fully paid up, perpetual, worldwide, terminable right and license:
(a) to use and apply all Licensed Technology (developed (i) pursuant to the
Development Agreement or in conjunction with IAT or (ii) for use in IAT
products) and related intellectual property rights (including all current and
future patents or copyrights and patent applications with respect thereto),
together with any and all improvements, enhancements, additions, changes or
derivatives developed by PDI during the term of this Agreement in connection
with the design, manufacture, use, sale, lease and distribution of ASIC
products, ASIC Derivatives and any other devices incorporating the Licensed
Technology and (b) to receive all documentation and other printed information
reasonably necessary to enable IAT to exploit the Licensed Technology to the
fullest extent and to reproduce the documentation for the purposes of sales,
marketing and field- and depot-level maintenance and repair by IAT. All rights
not expressly granted herein are reserved by PDI.
3. Payment. IAT shall pay PDI the license fees set forth in Exhibit B,
according to the payment terms set forth in Exhibit B.
4. Delivery. Immediately upon the effective date of this Agreement and
throughout the term of this Agreement PDI will: (a) provide to IAT all Licensed
Technology and all current ASIC Product user manuals and documentation in a
reproducible form; (b) allow IAT access to all tooling owned or controlled by
PDI related to the ASIC product or parts covered in this Agreement for the
purpose of securing parts necessary for the manufacture of the ASIC product or
parts; (c) provide IAT with all enhancements, updates, releases, additions, and
new or updated manuals or addenda sheets and new or revised data for all other
affected documentation furnished under this Agreement as such information is
available within PDI, but in any event not later than 30 days prior to the
effective date of the change; and (d) make qualified technical personnel
reasonably available, for a reasonable fee, to IAT's technical staff by
telephone, electronic or written communication on a reasonable "as needed" basis
to answer questions or provide information regarding the ASIC product and the
manufacture thereof.
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5. Warranties.
(a) Non-Infringement. PDI warrants to IAT that the ASIC does not infringe
the copyright or trade secret of any third party.
(b) No Conflicting Rights. PDI warrants to IAT that PDI has not previously
and will not grant any rights to any third party that are inconsistent with the
rights granted to IAT herein.
(c) Adequacy of Disclosure & Deliveries. The documentation and Licensed
Technology delivered to IAT will be sufficient, complete and adequate in all
material respects and in such form as to enable IAT to manufacture such ASIC
products to conform to the intended specifications for the ASIC products and
the technical, certification, manufacturing, quality control, and documentation
standards applicable in the industry;
(d) NO OTHER WARRANTIES. EXCEPT AS SET FORTH IN SECTIONS 5(a) AND (b),
THE LICENSED TECHNOLOGY IS PROVIDED "AS IS", INCLUDING PDI DISCLAIMS ALL OTHER
WARRANTIES AND CONDITIONS, EITHER EXPRESSED OR IMPLIED, INCLUDING WITHOUT
LIMITATION IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE, WITH REGARD TO THE ASIC.
6. Disclaimer, Limitation of Liability.
(a) DISCLAIMER. NEITHER PARTY SHALL BE LIABLE FOR ANY INDIRECT,
CONSEQUENTIAL, INCIDENTAL OR EXEMPLARY DAMAGES (INCLUDING WITHOUT LIMITATION
DAMAGES FOR LOSS OF BUSINESS PROFITS, BUSINESS INTERRUPTION, LOSS OF BUSINESS
INFORMATION, AND THE LIKE) EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.
(b) LIMITATION OF LIABILITY. IN NO EVENT SHALL EITHER PARTY'S TOTAL
LIABILITY FOR ANY DAMAGES IN CONNECTION WITH THIS AGREEMENT EXCEED THE LICENSE
FEES PAID BY IAT HEREUNDER, REGARDLESS OF WHETHER SUCH LIABILITY ARISES FROM ANY
CLAIM BASED UPON CONTRACT, WARRANTY, TORT, OR OTHERWISE.
7. Termination. Either party may terminate this Agreement immediately upon
written notice in the event the other party is in material breach of this
Agreement, including without limitation failure to pay any license fees due
thereunder, and such breach is not cured
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by the breaching party within thirty (30) days after receipt of written notice
of default from the other party. Immediately upon termination of this
Agreement, IAT shall cease use, distribution or other exercise of rights in the
Licensed Technology, and shall destroy all copies of Design Documents in IAT's
possession or control. Upon delivery of written notice to PDI, IAT will further
have the right to terminate the license granted herein if IAT no longer desires
to utilize the licensed technology in connection with the manufacture, use,
sale, lease or distribution of ASIC products.
8. Intellectual Property and Proprietary Rights. PDI maintains ownership of
the Licensed Technology, including documentation generated for the ASIC design.
IAT will have the right to modify, improve and enhance the Licensed Technology
from time to time. PDI will not have any ownership with respect to rights to any
such modification, improvement or enhancement developed by IAT.
9. Non-Disclosure. Each party expressly undertakes to retain in confidence
all information and know-how transmitted to such party by the other party that
the other party has designated as proprietary and/or confidential or that, by
the nature of the circumstances surrounding the disclosure, ought in good faith
to be treated as proprietary and/or confidential ("Confidential Information").
Each party shall take reasonable security precautions at least as great as the
precautions it takes to protect its own confidential information of a similar
nature, to safeguard the Confidential Information. Each party may disclose the
Confidential Information to its employees, consultants and fabricators only on a
need-to-know basis. Each party shall enter into and maintain appropriate written
agreements with its employees, consultants and fabricators sufficient to enable
it to comply with all provisions of this Agreement. Each party shall notify the
other party in writing of any misuse or misappropriation of Confidential
Information that may come to its attention. The obligations under this Section 9
shall survive any termination of this Agreement.
10. Notices and Requests. All notices and requests in connection with
this Agreement shall be deemed given as of the day they are received either by
messenger, delivery service, or in the United States of America mails, postage
prepaid, certified or registered, return receipt requested, and addressed as
follows:
IAT: IAT Multimedia, Inc.
c/o IAT AG
Geschaftshaus Wasserschloss
Xxxxxxxxxxx 00, XX-0000 Xxxxxxxxx-Xxxxx
Attention: Xx. Xxxxx Xxxxxx
PDI: Precision Digital Images
0000 000xx Xxxxxx, X.X.
Xxxxxxx, XX 00000
Attention: Mr. Xxxxx Xxxxx
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or to such other address as the party to receive the notice or request so
designates by written notice to the other.
11. Miscellaneous.
(a) Relationship of the Parties. The parties hereto are independent
contractors and nothing in this Agreement shall be construed as creating an
agency relationship, a partnership, a franchise, or a joint venture between the
parties.
(b) Governing Law. This Agreement shall be governed by the laws of the
State of Washington. In any action or suit to enforce any right or remedy under
this Agreement or to interpret any provision of this Agreement, the prevailing
party shall be entitled to recover its costs, including reasonable attorneys'
fees.
(c) Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof, and merges all
prior and contemporaneous communications. It shall not be modified except by a
written agreement dated subsequent to the date of this Agreement and signed on
behalf of IAT and PDI by their respective duly authorized representatives.
(d) Assignment. This Agreement may be assigned by PDI provided that all of
its obligations thereunder have been faithfully performed. IAT may assign its
rights under this Agreement only with PDI's prior written approval, except that
IAT will not need PDI's consent if such assignment is in connection with the
sale of all or substantially all of IAT's assets. Except as otherwise provided,
this Agreement shall be binding upon and inure to the benefit of the parties'
successors and lawful assigns.
(e) Arbitration. Any dispute, controversy, or claim arising out of this
Agreement, or the interpretation, performance, breach, enforcement or
termination thereof, or arising out of the respective rights and duties of the
parties to this Agreement, will be settled by arbitration in accordance with
the Arbitration Rules of the United Nations Commission on International Trade
Law (UNCITRAL), in effect as of the date hereof. This provision does not apply
to disputes, claims, or controversies involving any issues of or disputes
relating to patent validity or infringement arising out of or relating to this
Agreement, which will be determined by a court of competent jurisdiction. The
parties have agreed on this mechanism in order to obtain prompt and
expeditious resolutions of disputes. Unless the parties agree in writing on
the appointment of a single arbitrator, the matter will be referred to three
arbitrators; one to be appointed by each party, and the third, who will act as
Chairman, being nominated by the two so selected by the parties. The award is
to be given by a majority decision; however, if there be no majority, the
award will be made by the Chairman of the arbitral tribunal alone. The cost of
the proceeding will initially be borne equally by the parties to the dispute,
but the prevailing party in such proceeding will be entitled to recover, in
addition to reasonable attorney' fees and all other
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expenses, its contribution for the reasonable expenses of the arbitrator as an
item of damage and/or recoverable expenses. The exclusive venue of arbitration
will be in New York City, New York. The language of such arbitration will be
English; all documents and agreements relative to any such dispute will be read,
interpreted, and construed from English versions thereof. Judgment on the award
rendered by the arbitrators may be entered in any court of competent
jurisdiction, or application may be made to such court for judicial acceptance
of the award and/or an order of enforcement as the case may be.
Precision Digital Images Corporation IAT Multimedia, Inc.
("PDI") ("IAT")
/s/ G. Xxxxx Xxxxx /s/ Xxxxxx Xxxx
By (Sign) By (Sign)
G. Xxxxx Xxxxx Xx. Xxxxxx Xxxx
Name (Print) Name (Print)
CEO CEO
Title Title
5 June 1997 June 12, 1997
Date Date
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EXHIBIT A
ASIC Specifications
Xxxxx ASIC designed for the Vision Point 80 board as defined in the Joint
Development and Cross-License Agreement with Texas Instruments.
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EXHIBIT B
License Fees
1. IAT shall pay PDI Fifty Thousand Dollars (US$50,000) upon signing of
this Agreement.
2. In the event that IAT produces the ASICs while PDI is concurrently
producing ASICs, IAT will pay a royalty to PDI of Four Dollars (US$4.00) per
ASIC chip manufactured by IAT.
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