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EXHIBIT 10.29
TECHNOLOGY AGREEMENT
This agreement (the "Agreement") is made effective February 25, 1998 (the
"Effective Date") by and between Xxxxxxx Kodak Company, 000 Xxxxx Xxxxxx,
Xxxxxxxxx, XX 00000 ("Kodak") and Kofax Image Products, 0 Xxxxxx Xxxxxx, Xxxxxx,
XX 00000 ("Kofax").
WHEREAS, Kodak owns certain adaptive threshold processing (ATP) technology
which is a Kodak-patented algorithm that contains intelligent filters that
dramatically lower the amount of image noise and which produces sharper,
cleaner scans. (The filters also minimize artifacts on white-to-black and
black-to-white transitions); and
WHEREAS, Kofax desires to incorporate such ATP technology into a chip known as
XXXX (Kofax Advanced Thresholding Engine); and
WHEREAS, Kodak is willing to license ATP technology for such use; and
WHEREAS, Kodak may wish to purchase XXXX chips from Kofax; and
WHEREAS, Kofax is willing to sell XXXX chips to Kodak; and
WHEREAS, Kofax desires to purchase certain ATP chips proprietary to Kodak from
NEC/RYOSAN; and
WHEREAS, Kodak is agreeable to such purchase;
NOW THEREFORE, Kodak and Kofax have agreed as follows:
1. LICENSE OF ATP TECHNOLOGY TO KOFAX
1.1 Kodak grants and agrees to grant to Kofax a nonexclusive, worldwide,
royalty-bearing license to use the Kodak schematics to derive source code
in VHDL format for Kodak ATP technology, but solely to incorporate Kodak
ATP technology in net list form into the Kofax XXXX chip, and to distribute
the Kodak ATP technology, as so incorporated, to third parties. Kofax, in
turn, will provide Kodak with the modified source code, with respect to the
ATP technology, in VHDL format as implemented in the Kofax XXXX chip and
Kodak shall be the owner of such modified source code and net lists with
respect to the ATP technology. Kofax shall be the owner of the XXXX chip
and retain all modifications and derivations thereof, excluding the ATP
technology referred to above. Kofax has the right to use the ATP technology
in XXXX as specified above. This license also applies to bug fixes, new
features and new software versions provided by Kodak hereunder; provided
that Kodak reserves the right to negotiate a different royalty structure
for new features and new software versions.
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1.2 Kodak grants and agrees to grant to Kofax a nonexclusive, worldwide
license to use the Kodak ATP software, but solely (i) to demonstrate ATP
technology to third parties, and (ii) on a server or set up workstation
to download ATP technology to networked PCs.
2. PURCHASE OF XXXX CHIPS BY KODAK
2.1 Kofax agrees to sell XXXX chips to Kodak. Kodak is, however, under no
obligation to purchase XXXX chips.
2.2 It is understood by Kodak that, as of the Effective Date, the
specifications for XXXX were not finalized.
The parties agree to work cooperatively to incorporate maximum practical
value to Kodak in the XXXX chip, including but not limited to, the desire
to incorporate backward compatibility with existing Kodak ATP chips.
2.3 XXXX chips purchased by Kodak may be distributed to third parties only as
incorporated into a Kodak product. Under no circumstances may they be
sold as a stand-alone product.
2.4 Kodak may purchase XXXX chips directly from Kofax. The parties will
investigate the possibility of Kodak purchasing XXXX chips directly from
the Manufacturing foundry. Kodak shall purchase XXXX chips at Kofax's
cost.
3. SOURCING OF ATP CHIPS FROM NEC/RYOSAN
3.1 Subject to Kofax's compliance with the terms of this Section 3, and
payment of royalties as set forth in Section 5, Kodak authorizes Kofax to
purchase Kodak's ATP Chip, Kodak P/N/ 9B6927 (NEC P/N UPD65806GD-060-LML)
directly from RYOSAN. Kodak will notify NEC/RYOSAN that Kofax is an
authorized purchaser.
Order Placement Contact:
Ryosan
0000-0 Xxxxxx
Xxxxxxxx-Xxxx
Xxxxxxxx, 000 Xxxxx
Attn: Xx. Xxxxxxxx Xxxxxx
Tel. 00-000-00-0000
Fax. 00-000-00-0000
3.2 Kofax agrees that all claims for defective chips purchased by Kofax from
RYOSAN, and all communications relating to such defective chips will be
submitted through Kodak.
* Confidential Portions Have Been Omitted and Filed Separately with the
Commission.
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4. LICENSE FEES
4.1 Kofax will pay Kodak a one-time, non-refundable, non-creditable technology
license fee of [ * ] due and payable prior to first customer shipment by
Kofax of a production product containing ATP technology.
4.2 Kofax will pay Kodak a one-time, non-refundable, non-creditable software
license fee of [ * ] due and payable prior to first customer shipment by
Kofax of a production product containing ATP software technology.
4.3 Should Kodak elect to purchase XXXX chips, Kodak will pay Kofax a
one-time, non-refundable, non-creditable technology license fee of [ * ]
due and payable prior to first customer shipment by Kodak of a product
containing a XXXX chip.
5. ROYALTIES
5.1 For the license granted in Section 1.1, Kofax shall pay to Kodak a per
unit royalty for each unit of XXXX produced by or for Kofax and sold to
parties other than Kodak.
Cumulative Units of Xxxx Per Unit Royalty
------------------------ ----------------
[ * ]
5.2 For each ATP chip purchased by Kofax under Section 3, Kofax shall pay
Kodak a per unit royalty as follows:
Cumulative Units of ATP Chips Per Unit Royalty
----------------------------- ----------------
[ * ]
* Confidential Portions Have Been Omitted and Filed Separately with the
Commission.
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5.3 For each unit of XXXX purchased by Kodak, Kodak shall pay Kofax a per unit
royalty as follows:
Cumulative Units of XXXX Per Unit Royalty
------------------------ ----------------
[ * ]
6. COST AND MINIMUM ORDER QUANTITY, ATP CHIPS
6.1 Kofax may purchase ATP chips from NEC/RYOSAN at the same per unit price as
is charged Kodak. Such price is currently as follows:
Cumulative Volume Unit Price (Yen)
----------------- ----------
[ * ]
6.2 Minimum order quantity is 100 pieces.
6.3 The pricing above is based on stair-step pricing and is cumulative over
the term of the agreement.
7. PAYMENT AND AUDITING
7.1 Royalty reports and royalty payments shall be made thirty (30) days after
the close of the calendar quarter in which the royalties accrued. Each
report shall show the royalty calculation.
Contacts for Royalty Payments and Invoices:
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For Kodak: For Kofax:
Ms. Xxxxxxxx Xxxxx Xx. Xxxxx Xxxxxxxxx
Xxxxxxx Kodak Company Kofax Image Products
000 Xxxxx Xxxxxx 0 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000-0000 Xxxxxx, XX 00000
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7.2 Audit. Each party agrees to allow a mutually acceptable, independent,
certified public accountant to audit its accounting records upon which the
royalty reports are based, provided that such accountant shall hold such
records in strictest confidence except as necessary to provide a summary
report on the accuracy of such royalty reports. Any such audit shall be
permitted within thirty (30) days of receipt of a written request to
audit, during normal business hours, at a time mutually agreed upon. The
cost of such audit will be borne by the auditing party. Audits shall not
be made more frequently than annually and shall not unreasonably interfere
with normal business activities. The determination of the payments due
under this Agreement shall be deemed conclusive unless, within twelve (12)
months from date of payment, notification is made in writing of any
probably error in such payments disclosed by royalty reports or an
inspection by such audit.
8. DISCLOSURE
8.1 Kofax is authorized by Kodak to reveal to any third party as they deem
necessary, or as may be required by law, the inclusion of Kodak ATP
technology in XXXX. Kofax will advise Kodak when a third party has been
disclosed.
8.2 With at least sixty (60) days prior written notice to Kofax, Kodak may
make a public announcement of the fact that Kodak ATP technology is
incorporated into Kofax products.
8.3 With at least sixty (60) days prior written notice to Kodak, Kofax may
make a public announcement of the fact that Kodak ATP technology is
incorporated into Kofax products.
8.4 The specific details of this Agreement will not be shared by either party
without the written consent of the other party.
9. MARKETING
9.1 Neither party has any obligation to use the other party's products or
technologies, however, it is understood that it is Kofax's intention to
use Kodak ATP technology, ATP software, and ATP chips.
9.2 Kofax, once it has commenced use of Kodak ATP technology, ATP software, or
ATP chips shall give Kodak a minimum of sixty (60) days prior written
notice before discontinuing their use.
* Confidential Portions Have Been Omitted and Filed Separately with the
Commission.
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10. SIMILAR TECHNOLOGIES
Nothing herein shall be construed as preventing either party from
obtaining from third parties or developing or having developed
technologies similar in function to those provided hereunder by the
other party, without reliance upon any intellectual property rights of
the other party.
11. WARRANTS
11.1 Each party warrants that it has all rights necessary to grant to the
other party the rights and licenses granted herein.
11.2 DISCLAIMER OF WARRANTY. THE FOREGOING WARRANTIES ARE THE SOLE AND
EXCLUSIVE WARRANTIES GIVEN BY EITHER PARTY IN CONNECTION WITH THIS
AGREEMENT, EXPRESS OR IMPLIED, AND EACH PARTY DISCLAIMS ALL IMPLIED
WARRANTIES, INCLUDING IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS
FOR A PARTICULAR PURPOSE.
12. INDEMNIFICATION
Each party will defend, indemnify, and hold harmless the other party
against any claim that any products, software, or technologies
(collectively, "Products") as delivered by one party to the other party
directly infringe any third party's patent, copyright or trade secret.
A party's obligation to defend, indemnify and hold harmless the other
party will be subject to the following terms and conditions:
(a) The obligation will arise only if the indemnified party gives the
indemnifying party prompt notice of the infringement claim and
grants the indemnifying party, in writing, exclusive control
over its defense and settlement;
(b) The obligation will cover only the Products as delivered by one
party to the other party, and not to any correction, modification,
or addition made by anyone, whether with or without authorization,
where the product without such correction, modification or
addition would not infringe;
(c) The obligation will not cover (i) any claim based on the use of any
of the Products to practice a process or the furnishing of any
information, service, or technical support, or (ii) any claim that
any of the Products infringes any third party's rights as used in
combination with any products not supplied by the party which
supplied the Products, if that claim could have been avoided by the
use of the Product without combination with other products;
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(d) Should a party's use of any such Products or any part thereof be
enjoined, or in the event that the party supplying Products desires to
minimize its liability hereunder, the supplying party will, at its
option and expense: (i) procure a license from the person claiming or
likely to claim infringement; (ii) modify the Products, as
appropriate, to avoid the claim of infringement, as long as
modification for this purpose does not materially impair the operation
thereof; or (iii) substitute fully equivalent non-conforming Products
for the infringing items. If none of the foregoing is feasible, either
party may terminate this Agreement.
THE FOREGOING STATES SUPPLIER'S EXCLUSIVE OBLIGATION WITH RESPECT TO
CLAIMS OF INFRINGEMENT OF PROPRIETARY RIGHTS OF ANY KIND.
13. PROTECTION OF SCHEMATICS/SOURCE CODE AND OTHER CONFIDENTIAL INFORMATION
Kofax understands that the schematics/source code of ATP software, and the
net lists provided hereunder (the "Materials") contain valuable
proprietary and confidential information of Kodak and therefore agrees:
(a) to use the Materials only in accordance with the terms of this
Agreement;
(b) to limit access to those employees who are directly involved in
accomplishment of such purposes;
(c) to include on all copies of Materials the copyright and proprietary
information notices of Kodak;
(d) to take appropriate action, by instruction, agreement, or otherwise,
with any person having access to Materials to enable Kofax to satisfy
its obligations under this Agreement;
(e) to protect the Materials from disclosure using at least the same
degree of care Kofax uses to protect its own information of similar
nature and value.
OTHER CONFIDENTIAL INFORMATION
Other confidential information to be shared under this Agreement
shall be governed by the terms and conditions of the Confidentiality
Agreement signed by the parties on January 25, 1997, with the
following amendments:
1. Paragraph 2 shall also include ATP Technology.
2. Paragraph 3 shall also include XXXX.
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3. Subparagraph 5(b) is deleted and replaced with the following:
"disclosed during the term of the Technology Agreement (TA) between
the companies dated _______________."
4. Paragraph 6 is modified as follows:
"...expires 2 years after the Effective Date." is modified to
"...expires five (5) years after the termination of the TA."
14. LIMITATION OF LIABILITY
NEITHER PARTY SHALL BE LIABLE FOR ANY SPECIAL, INCIDENTAL, OR
CONSEQUENTIAL DAMAGES EVEN IF INFORMED OF THE POSSIBILITY THEREOF IN
ADVANCE.
15. TERM
This Agreement shall be effective on the Effective Date and shall
terminate on the fifth anniversary thereof unless earlier terminated as
set forth below.
16. TERMINATION
16.1 Causes for Termination
16.1.1 As provided in Section 15.
16.1.2 By only the non-breaching party on the thirtieth (30th) day
after either party gives the other notice of a material breach
by the other of any terms or conditions of this Agreement,
unless the breach is cured prior to that day.
16.2 The Effect of Termination
16.2.1 All licenses granted the breaching party shall immediately
terminate, provided that the rights of the purchasers of
products incorporating the technology shall continue for such
products purchased prior to termination of this Agreement.
16.2.2 All rights granted the breaching party to purchase the other
party's technology, directly or indirectly, shall terminate
immediately.
16.2.3 All accrued royalties shall be immediately due and payable.
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16.2.4 The breaching party shall have sixty (60) days in which to
dispose of inventory containing the non-breaching parties'
technology after which time the breaching party may not
transfer such inventory to any third party.
16.2.5 All outstanding orders for the non-breaching party's
technology, direct or indirect, shall be immediately
canceled.
16.2.6 All provisions of this Agreement which by their nature
should survive termination shall survive termination.
16.2.7 The breaching party shall, within thirty (30) days of
termination, return to the other party all of the other
party's information, documentation, and technology in its
possession or under its control.
17. GENERAL PROVISIONS
17.1 Assignment. Neither party may assign any rights or delegate any duties
under this Agreement by operation of law or otherwise without the other
party's prior written consent, and any attempt to do so without that
consent will be void. Subject to the foregoing, this Agreement will bind
and inure to the benefit of the parties and their respective successors
and permitted assigns.
17.2 Choice of Law. Notwithstanding the place where this Agreement is
executed, or where obligations under this Agreement are performed, the
parties expressly agree that this Agreement and any claim or controversy
arising out of or relating to rights and obligations of the parties under
it will be governed by and construed in accordance with the substantive
laws of the State of New York, without regard to its conflicts of laws
principles or the provisions of the United Nations Convention on
Contracts for the International Sale of Goods or the United Nations
Convention on the Limitation Period in the International Sale of Goods,
as each is amended; and all actions arising out of or related to this
Agreement, the performance or breach of it or any warranties under it
must be filed in the New York State Courts with jurisdiction in Monroe
County, New York or in the United States District Court of the Western
District of New York. The parties hereby submit to the nonexclusive
personal jurisdiction of, and waive any objection against, the
aforementioned Courts.
17.3 Amendment. This Agreement may be amended or supplemented only by a
writing that refers explicitly to this Agreement and that is signed on
behalf of both parties. No purchase order, invoice or similar document
which is in conflict with or inconsistent with this Agreement will affect
this Agreement even if accepted by the receiving party.
17.4 Waiver. No waiver will be implied from conduct or failure to enforce
rights. No waiver will be effective unless in a writing signed on behalf
of the party against whom the waiver is asserted.
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17.5 Contingencies. Neither party will have the right to claim damages or to
terminate this Agreement as a result of the other party's failure or
delay in performance due to circumstances beyond its reasonable control,
such as labor disputes, strikes, lockouts, shortages of or inability to
obtain labor, energy, components, raw materials or supplies, war, riot,
insurrection, epidemic, act of God, or governmental action not the fault
of the non-performing party.
17.6 Severability. If any part of this Agreement is found invalid or
unenforceable, that part will be enforced to the maximum extent permitted
by law, and the remainder of this Agreement will remain fully in force.
17.7 Equitable Relief. Either party may apply for injunctive, preliminary, or
other equitable relief to remedy any actual or threatened dispute
hereunder.
17.8 Entire Agreement. This Agreement, including all Schedules hereto, which
are hereby incorporated by reference, represents the entire agreement
between the parties relating to its subject matter and supersedes all
prior representations, discussions, negotiations and agreements, whether
written or oral.
17.9 Notices. All notices, reports, requests, approvals, and other
communications required or permitted under this Agreement must be in
writing. They will be deemed given when (a) delivered personally, (b)
sent by commercial overnight courier with written verification or
receipt, (c) upon receipt or refusal of receipt if sent by registered or
certified mail, postage prepaid or (d) facsimile onto confirmation of
successful transmission. All communications must be sent to the receiving
party's Initial Address for Notice on the signature pages or to any other
address that the receiving party may have provided for purposes of notice
by notice as provided in this paragraph.
17.10 Fees. In any suit to enforce this Agreement, the prevailing party will
have the right to recover costs and reasonable fees of attorneys,
accountants and other professionals, including costs and fees on appeal.
17.11 Relationship of Parties. The parties to this Agreement are independent
contractors. There is no relationship of agency, partnership, joint
venture, employment or franchise between the parties. Neither party has
the authority to bind the other or to incur any obligation on its behalf.
17.12 Paragraph Headings and Language Interpretation. The paragraph headings
contained herein are for reference only and shall not be construed as
substantive parts of this Agreement. The use of the singular or plural
form shall include the other form, and the use of the masculine, feminine
or neuter gender shall include the other genders.
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17.13 Conflicts in Documentation. In case of any conflicts between this
Agreement and any prior agreements on the same subject, Purchase
Orders, acceptances, correspondence, memoranda, listing sheets and
other documents, this Agreement shall govern and prevail, and the
conflicting terms and conditions of any such documents shall be deemed
deleted and shall not be binding upon either party.
IN WITNESS WHEREOF, the parties have executed this Agreement through their duly
authorized representatives as of the Effective Date set forth above.
KOFAX IMAGE PRODUCTS Initial Address for Notice:
By: /s/ XXXXX X. SILVER 3 Jenner Street
--------------------------------- Xxxxxx, XX 00000
Name: Xx. Xxxxx X. Silver Attn: President, Kofax Image Products
------------------------------ Fax: 000-000-0000
Title: Chief Executive Officer,
President
XXXXXXX KODAK COMPANY Initial Address for Notice:
By: /s/ XXXXX XXXXXX 000 Xxxxx Xxxxxx
--------------------------------- Xxxxxxxxx, XX 00000
Name: Xx. Xxxxx Xxxxxx Attn: President, Business Imaging
------------------------------ Systems
Title: President, Business Imaging
Systems
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