AGREEMENT
Between
XXXXXXX, INC.
and
WATERLOO FURNITURE COMPONENTS, LTD.
and
WATERLOO FURNITURE COMPONENTS, INC.
AGREEMENT
This Agreement effective October 1, 1992, by and between Xxxxxxx, Inc., a
Michigan corporation having a place of business at One Xxxxxxx Center, 0000
Xxxxxxx X-00. Xxxxxxx, Xxxxxxxx 00000, hereinafter referred to as "HAWORTH,"
and Waterloo Furniture Components, Ltd., a corporation organized under the laws
of the province of Ontario, having a place of business at 000 Xxxxxxx Xxxxx,
Xxxxxxxxx, Xxxxxxx, Xxxxxx, X0X 0X0, and Waterloo Furniture Components, Inc., a
corporation organized under the laws of the state of Nevada, having a place of
business at 000 Xxx Xxxx Xxxx, Xxxxxxx, Xxxxx Xxxxxxxx, hereinafter collectively
referred to as "WATERLOO."
WITNESSETH:
WHEREAS, HAWORTH is the owner of all right, title and interest in and to an
invention in an articulated keyboard support device and in particular United
States Patent No. 4,616,798 issued October 14, 1986, and entitled "ADJUSTABLE
SUPPORT FOR CRT KEYBOARD" (hereinafter referred to as the "'798 patent" or the
"Licensed Patent");
WHEREAS, WATERLOO has manufactured and sold articulated keyboard support
devices subsequent to October 14, 1986, including the Model 6100 Series and
Model 4100 Series products, some of which devices are asserted by Haworth to
directly and/or contributorily infringe one or more of the claims of the '798
patent;
WHEREAS, HAWORTH and WATERLOO agree that HAWORTH has no patent protection
prohibiting WATERLOO from continuing to manufacture and sell its existing
articulated keyboard support products in Canada and HAWORTH has not, and will
not in the future, seek damages or royalties for the manufacture of such
products for sale and use in Canada.
WHEREAS, WATERLOO disputes XXXXXXX'x allegations of infringement and has
challenged the validity of the '798 patent, but desires to avoid the expense of
additional litigation.
WHEREAS, WATERLOO represents that the WATERLOO Model 6100 series products
are within the scope of the claims of U.S. Patent No. 5,037,054 owned by
WATERLOO, and HAWORTH acknowledges such representation.
WHEREAS, HAWORTH and WATERLOO are desirous of amicably settling pending
litigation and resolving the outstanding controversy therebetween with respect
to the allegedly infringing keyboard support devices manufactured and/or sold by
WATERLOO subsequent to October 14, 1986;
WHEREAS, WATERLOO is desirous of also obtaining a license under the '798
patent to permit, without the threat of alleged infringement or litigation, the
continued manufacture and/or sale of such devices beginning as of the effective
date of this Agreement;
WHEREAS, HAWORTH is also desirous of resolving this controversy without
further litigation.
NOW, THEREFORE, in consideration of the mutual covenants and promises
herein set forth, HAWORTH and WATERLOO agree as follows:
SECTION I
DEFINITIONS
I-1. The term "Licensed Patent" shall refer to aforesaid U.S. Patent No.
4,616,798 (hereinafter also referred to as the '798 patent).
I-2. The term "Licensed Unit(s)" shall refer to an articulated keyboard
support device (either with or without the pad which directly supports a
keyboard) which is adapted to be mounted on a work surface and (1) which HAWORTH
heretofore alleged to fall or (2) which in the future falls within the scope of
one or more claims of the Licensed Patent so as to give rise to direct or
contributory infringement thereof. The current WATERLOO models for which
royalties shall be paid are identified on Addendum A.
I-3. If the Licensed Unit is sold without the pad, then the term "Selling
Price" shall mean the price of the Licensed Unit (without the pad) in an arm's
length transaction for a separate specified consideration payable in money, less
any sales or use taxes, less any discounts allowed and taken in amounts
customary in the trade such as quantity discounts, and less duty, freight or
shipping charges, if separately itemized on the invoice, but before deductions
of cash discounts or agents' commissions. If the Licensed Unit is sold with a
pad, then the price of the pad shall not be included in the "Selling Price" as
defined herein if the price of the pad is separately itemized on the invoice.
As to all Licensed Units sold with pads prior to the date of signing of this
Agreement, it is not a requirement of this Agreement that the selling price of
the pad be separately itemized on the invoice, and in situations where the
Licensed Unit included a pad, then WATERLOO shall be entitled to deduct the cost
of the pad from the "selling price."
I-4. The term "sell" or "sale" and conjugate terms shall include lease,
transfer, deliver, or otherwise dispose of for consideration. The "sale" of a
Licensed Unit shall be considered to have occurred or such Licensed Unit shall
be considered to be "sold" when such Licensed Unit is billed out, or if not
billed out, then when delivered, or disposed of by WATERLOO for purposes other
than that of soliciting sales from customers or when paid for if paid for before
delivery.
I-5. The term "Licensed Territory" shall include the United States of
America including its territories and possessions. WATERLOO may sell Licensed
Units anywhere in the world except Japan.
I-6. The term "Agreement Year" in reference to the length of term of this
Agreement shall have reference to a twelve (12) month interval extending from
either the effective date hereof or the annual anniversary of the effective date
hereof, and the term "quarter(s)" will refer to three (3) month intervals within
said Agreement Year and ending as of the last day of the months of September,
December, March and June.
SECTION II
GUARANTEED PAYMENTS
II-1. In exchange for XXXXXXX'x agreement to settle pending litigation
between HAWORTH and WATERLOO, and to refrain from legal action against
WATERLOO's customers for infringement of the '798 patent based on sales and uses
of WATERLOO keyboard support devices occurring prior to October 1, 1992,
WATERLOO shall pay to HAWORTH a Guaranteed Total Sum of One Million Five Hundred
Fifty Thousand Dollars ($1,550,000.00), payable as follows:
1.1 An initial payment of Five Hundred Fifty Thousand Dollars
($550,000) within ten (10) days of the execution of this Agreement; and
1.2 An Annual Settlement Payment of Two Hundred Thousand Dollars
($200,000) during each of the first, second, third, fourth and fifth
Agreement years. The Annual Settlement Payment for each said Agreement
Year shall be paid in equal quarterly installments on the thirtieth (30th)
day of the month following each quarter (that is the thirtieth (30th) day
of January, April, July and October). Any quarterly payments having a
payment date prior to the execution of this agreement shall be paid within
ten (10) days of the execution of this agreement.
II-2. No interest shall be charged with respect to said Guaranteed
Total Sum, provided that all payments are timely made.
II-3. WATERLOO guarantees payment of the Guaranteed Total Sum specified
in Section II-1 above, in settlement of the controversy between the parties,
except as provided under section VII-5 below. In the event that any claim of
the '798 patent is held unpatentable, unenforceable or invalid for any reason in
any litigation or re-examination, no part of said Guaranteed Total Sum shall be
forgiven, or be discharged or be refundable to WATERLOO.
SECTION III
GRANT AND TERM
III-1. HAWORTH hereby grants to WATERLOO a non-exclusive right and
license to manufacture, have manufactured, use and sell Licensed Units within
said Licensed Territory. WATERLOO shall not have the right to grant sublicenses
hereunder, except to affiliated companies.
III-2. No license is granted expressly or by implication by virtue of
this Agreement under any other patent of HAWORTH, domestic or foreign. No
current WATERLOO keyboard support device is an infringement or within the scope
of any claim of any other U.S. or Canadian patent or patent application of
HAWORTH.
III-3. The effective date of this Agreement and the license granted
herein shall be October 1, 1992.
III-4. This Agreement shall be effective only when executed by both
parties and shall continue for the full term of said Licensed Patent, unless
this Agreement is earlier terminated pursuant to the provisions hereof.
SECTION IV
ROYALTIES
IV-1. In consideration of the grant by HAWORTH to WATERLOO of the
license under Section III, WATERLOO agrees to pay to HAWORTH a royalty as
follows:
1.1 (1) Ten percent (10%) of the selling price (as defined in
Section I-3 above) for the first One Hundred Thousand (100,000) Licensed
units sold by WATERLOO during each Agreement Year; (2) Eight percent (8%)
of the Selling Price (as defined in Section I-3 above) for the second One
Hundred Thousand (100,000) Licensed Units sold by WATERLOO during each
agreement year; and (3) Three percent (3%) of the Selling Price (as defined
in Section I-3 above) for any Licensed Units over Two Hundred Thousand
(200,000) Licensed Units sold by WATERLOO during each agreement year.
1.2 However, as a matter of accounting convenience WATERLOO may elect
to calculate and pay royalties at the following per unit rates based upon
an average selling price of $35.00 per unit: (1) Three Dollars and Fifty
Cents ($3.50) per Licensed Unit for the first One Hundred Thousand
(100,000) Licensed units sold by WATERLOO during each Agreement Year; (2)
Two Dollars and Eighty Cents ($2.80) per Licensed Unit for the second One
Hundred Thousand (100,000) Licensed Units sold by WATERLOO during each
agreement year; and (3) One Dollar and Five Cents ($1.05) per Licensed Unit
for Licensed Units over Two Hundred Thousand (200,000) Licensed Units sold
by WATERLOO during each agreement year.
1.3 It is understood that WATERLOO must elect, in writing, whether to
calculate royalties under paragraph IV-1.1 or paragraph IV-1.2 at the time
of the first quarterly payment and all future payments will be made on the
same basis.
IV-2. WATERLOO shall be entitled to deduct from the royalties due
Haworth, during each of the initial five Agreement Years, the Annual Settlement
Payment (as defined in Section II-1.2) paid to HAWORTH for the same Agreement
Year. The Initial Settlement Payment of Section II-1.1 above shall not be
deductible from royalties.
IV-3. Royalties shall be payable from WATERLOO to HAWORTH on a
quarterly basis, with the quarterly royalty payment being due by no later than
the thirtieth (30th) day of the month following the end of each quarter (i.e.,
the quarterly royalties being due on the 30th day of January, April, July and
October). Each Quarterly royalty payment may be reduced by the amount of the
quarterly Annual Settlement Payment paid for the same quarter, and the royalty
payment owed by WATERLOO to HAWORTH for the Agreement Year (as paid quarterly)
shall be the difference between the total computed royalty for the Agreement
Year (including any credit as described in paragraph IV-5 below) minus the total
Annual Settlement Payment paid by WATERLOO to HAWORTH for the same Agreement
Year.
IV-4. WATERLOO shall not be entitled to pay Settlement Payments or
royalty payments into escrow accounts.
IV-5. With respect to sales of Licensed Units on or after October 1,
1992, WATERLOO may claim a credit for any royalty previously paid or due to
HAWORTH for Licensed Units that have been returned to WATERLOO for credit by
customers of WATERLOO in proportion to the amount of any credit against the
Selling Price that has been allowed by WATERLOO to said customers. No credit
may be claimed with respect to any keyboard support devices sold prior to
October 1, 1992.
SECTION V
GENERAL PROVISIONS RELATING TO ROYALTIES
V-1. WATERLOO shall keep complete and accurate records of all Licensed
Units sold or otherwise disposed of by WATERLOO. On or before the thirtieth
(30th) day of each of January, April, July and October (the "payment date"),
WATERLOO shall render a written statement to HAWORTH setting forth by model,
style or catalog number, the quantity of Licensed Units sold by WATERLOO during
the preceding quarter, and the amount of royalties due. If royalty payments are
based upon a percentage of the Selling Price (as defined in paragraph I-3 above)
then the written statement shall also include the Selling Price of the Licensed
Units. WATERLOO shall contemporaneously pay the royalties due to HAWORTH in the
manner set forth in this Agreement. The first royalty "payment date" shall be
January 30, 1993, and the respective statement and royalty payment shall be for
the fourth quarter, 1992. If no Licensed Units have been sold during any
quarter, WATERLOO shall render a written statement to HAWORTH of such fact. The
royalty statements of WATERLOO, if requested by HAWORTH, shall be certified as
to correctness by a corporate officer of WATERLOO or by an independent certified
public accountant.
V-2. Within thirty (30) days after expiration or termination of this
Agreement, WATERLOO shall render a statement to HAWORTH containing the
information called for in Section V-1 and covering any period prior to
expiration or termination for which a statement has not been previously rendered
and shall contemporaneously pay the royalties due for said period.
V-3. HAWORTH may require WATERLOO to pay interest upon any and all amounts
of royalty or settlement payments due to HAWORTH that are unpaid more than
fifteen (15) days following the applicable payment date, from the applicable
payment date to the date of payment, the rate of such interest being the prime
rate at the Bank of America on the applicable payment date.
V-4. WATERLOO agrees to permit the records referred to in Section V-1
hereof to be examined (at XXXXXXX'x expense) during normal business hours and no
more frequently than once each calendar year by an auditor or independent
certified public accountant mutually acceptable to HAWORTH and WATERLOO in order
to verify the accuracy of WATERLOO's statements and of the payments required to
be made hereunder. WATERLOO shall make prompt adjustments to correct any errors
or omissions in WATERLOO's statements or payments disclosed by such audit.
Neither XXXXXXX'x right to audit nor its right to receive adjustment shall be
effected by any statement to the contrary appearing on checks or otherwise. In
the event that such examination determines underpayment of royalties in excess
of two percent (2%) for any Agreement Year, then WATERLOO shall bear the cost of
the examination. In the event that such examination determines overpayment of
royalties, HAWORTH shall promptly refund WATERLOO the overpayment to correct any
errors, alternatively, at WATERLOO's sole discretion, the overpayment may be
credited to future royalty payments.
V-5. If any claim or claims of the '798 patent are subsequently declared
invalid, unpatentable or unenforceable by any final and nonappealable decision
by a Federal Court, the United States International Trade Commission or the
Patent and Trademark Office, then WATERLOO's obligation to pay royalties with
respect to said claim or claims shall cease as of the day the decision becomes
final and nonappealable. Furthermore, in the event that hereafter either (1)
The United States Patent and Trademark Office or a Court of competent
jurisdiction in a final non-appealable determination or (2) HAWORTH construes
the claims of the '798 patent to have a scope of coverage which excludes any
WATERLOO model(s) listed on Addendum A, then (1) WATERLOO is not estopped from
asserting non-infringement by said model(s), (2) no subsequent royalty is due
hereunder as to said model(s) and (3) no presumption of claim coverage or
infringement shall be applied to said model(s) by virtue of this Agreement.
V-6 In any case WATERLOO's obligation to pay royalties shall cease as of
the day the '798 patent expires.
SECTION VI
NOTICE AND TERMINATION
VI-1. Any notice which HAWORTH or WATERLOO is required or permitted to
give pursuant to any of the provisions of this Agreement by either party to the
other, shall be regarded as properly given if the same is embodied in a letter
signed by a duly authorized officer or agent of the party sending notice, sent
by Certified or Registered Mail, Return Receipt Requested, and addressed to the
parties as follows:
If to HAWORTH: If to WATERLOO FURNITURE COMPONENTS,
LTD.
Xxxxxxx, Inc. Waterloo Furniture Components, Ltd.
Xxx Xxxxxxx Xxxxxx 000 Xxxxxxx Xxxxx
0000 Xxxxxxx X-00 Xxxxxxxxx, Xxxxxxx X0X 0X0
Xxxxxxx, Xxxxxxxx 00000 CANADA
Attention: President Attention: President
If to WATERLOO FURNITURE COMPONENTS,
INC.
Waterloo Furniture Components, Inc.
000 Xxx Xxxx Xxxx
Xxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: President
The effective date of said notice shall be the date of receipt by the addressee.
VI-2. Any payment made to HAWORTH under this Agreement shall be
addressed to:
Xxxxxxx, Inc.
One Xxxxxxx Center
0000 Xxxxxxx X-00
Xxxxxxx, Xxxxxxxx 00000
Attention: Vice President of Finance,
or to any other location subsequently authorized by HAWORTH in writing.
VI-3. WATERLOO shall have the right to terminate this Agreement and the
license granted to it hereunder by written notice to HAWORTH. This Agreement
and the rights granted to WATERLOO hereunder shall terminate upon receipt of
such termination notice by HAWORTH. There shall be no refund or return of any
monies paid to HAWORTH by WATERLOO prior to said termination, and WATERLOO shall
not thereby be relieved or discharged of paying either the Guaranteed Total Sum
specified in Section II hereof or the full sum for past royalties set forth in
Section IV hereof.
VI-4. If WATERLOO shall at any time default in making any payment
required under this Agreement or in making any report hereunder, or commit any
breach of any covenant or Agreement herein contained, and shall fail to remedy
any such default or breach within sixty (60) days after receipt of written
notice from HAWORTH specifying such default or breach, then by notice in writing
to this effect and at its option, HAWORTH may terminate this Agreement and the
license hereunder, but such termination shall not prejudice XXXXXXX'x rights
which shall have accrued to the date of such termination, nor its rights to
recover any royalty or any payment due at the time of such termination nor shall
it prejudice any cause of action or claims of HAWORTH accrued or to accrue on
account of any breach or default by WATERLOO. This Agreement and the rights
granted to WATERLOO hereunder shall terminate upon receipt of such termination
notice by WATERLOO.
VI-5. HAWORTH shall have the right to terminate this Agreement at any
time upon or after the filing by WATERLOO of a petition in bankruptcy or
insolvency, or upon or after any adjudication that WATERLOO is bankrupt or
insolvent, or upon or after the filing by WATERLOO of any petition or answer
seeking reorganization, readjustment, or rearrangement of WATERLOO under any law
relating to bankruptcy or insolvency, or upon or after the appointment of a
receiver for all or substantially all of the property of WATERLOO, or upon or
after the making by WATERLOO of any assignment or attempted assignment for the
benefit of creditors, or upon or after the institution by WATERLOO of any
assignment or attempted assignment for the benefit of creditors, or upon or
after the institution by WATERLOO of any proceedings for the liquidation or
winding up of its business, and upon the exercise of such right, this Agreement
shall terminate thirty (30) days after notice in writing to that effect has been
sent by HAWORTH to WATERLOO. It is, however, understood that should either
entity, Waterloo Furniture Components, Ltd. or Waterloo Furniture Components,
Inc. liquidate, wind-up business or otherwise take or be subject to an action
covered by this paragraph, while the other entity continues business, HAWORTH
has no right, under this paragraph, to terminate this Agreement with respect to
the entity continuing business.
VI-6. HAWORTH shall have the right to terminate this Agreement if
WATERLOO voluntarily (i.e. absent a court order, a subpoena or other similar
process) assists any third party in contesting the validity, patentability,
enforceability or scope of coverage of the '798 patent.
VI-7. Expiration or termination of this Agreement shall not release
WATERLOO from any of its obligations hereunder with regard to Licensed Units
manufactured prior to expiration or termination, and shall not rescind or give
rise to any right to rescind anything done or to claim return of, or
cancellation of any payment, obligation occurring, or other consideration given
to HAWORTH hereunder, prior to the time of expiration or termination.
VI-8. Failure or delay on the part of HAWORTH to exercise its right of
termination hereunder for any one or more breaches or defaults shall not be
deemed a waiver of its right of termination for such or for any other subsequent
breach or default. Likewise, failure or delay on the part of WATERLOO to
exercise its right of termination hereunder for any one or more breaches or
defaults shall not be deemed a waiver of its right of termination for such or
for any other subsequent breach or default.
SECTION VII
GENERAL PROVISIONS
VII-1. WATERLOO shall xxxx all Licensed Units with the number of the
Licensed Patent, such as by using the phrase "Patent No. 4,616,798" or
equivalent.
VII-2. If, during the term of this Agreement, HAWORTH grants a license
to thereafter make, use or sell under the '798 patent to a direct competitor of
WATERLOO at a more favorable royalty than that contained in Section IV-1 hereof,
and if the royalty is a primary tangible consideration received or receivable by
HAWORTH for grant of the license, then such more favorable royalty will be
automatically offered to WATERLOO and shall be effective as of the date said
royalty comes into effect with respect to said competitor, provided that
WATERLOO accepts said more favorable royalty together with any less favorable
terms that may be in such other license. However, if such license granted by
HAWORTH to a direct competitor of WATERLOO provides to HAWORTH non-monetary
considerations, which are unique to such competitor, then WATERLOO may adopt the
terms of such license, if WATERLOO offers to HAWORTH non-monetary considerations
which are substantially equivalent to such unique non-monetary considerations.
The intent of HAWORTH and WATERLOO is to provide that WATERLOO is treated no
less favorably than direct competitors of WATERLOO in regard to licensing of the
'798 patent. XXXXXXX'x competitors in the office furniture business arc
acknowledged to not be direct competitors with WATERLOO within the meaning of
this provision. In the event that HAWORTH enters into any license agreement
under the '798 patent with any direct competitor of WATERLOO, then HAWORTH shall
provide written notice of such agreement and the terms thereof to WATERLOO
within thirty (30) days following the execution thereof.
VII-3. HAWORTH agrees to make no attempt to commercially use the fact
that WATERLOO is licensed under the '798 patent, and more specifically, will not
use this license relationship in promoting or attempting to sell XXXXXXX'x
products to prospective customers. If WATERLOO has reason to believe that
HAWORTH has failed to fully comply with this commitment, then WATERLOO shall
notify HAWORTH so as to enable HAWORTH to take necessary action to resolve the
matter and insure compliance with this provision. In those situations where
HAWORTH is attempting to enforce and/or license the '798 patent, then HAWORTH
shall have the right to disclose that WATERLOO is licensed under the '798
patent.
VII-4. HAWORTH agrees to make reasonable efforts consistent with its
sound business judgment to enforce the '798 patent against infringers.
4.1 If WATERLOO becomes aware of an infringement by a direct
competitor of WATERLOO (as defined in paragraph VII-2 above) then WATERLOO
shall promptly notify HAWORTH, in writing, of the infringement and show the
extent of infringement to enable HAWORTH to evaluate same. If such
infringement is a Substantial Infringement (as set forth below), and in the
event HAWORTH fails, within twelve (12) months from the date of such
notification showing Substantial Infringement, to: (1) cause such
infringement to cease or become reduced to less than Substantial
Infringement; or (2) demonstrate by a reasonable showing, diligent
prosecution toward termination of Substantial Infringement; or (3) bring
suit and prosecute the same with reasonable diligence against said
infringer in response to the notification served by WATERLOO, then WATERLOO
shall be entitled to withhold royalties which would otherwise accrue
thereafter under this agreement. However, upon a subsequent reasonable
showing by HAWORTH to WATERLOO of diligent prosecution toward termination
of Substantial Infringement, WATERLOO shall resume payment of royalties
effective as of the date of said showing and shall also pay to HAWORTH
royalties accrued during the period of time during which WATERLOO withheld
royalties in accordance with the above. The term "Substantial
Infringement" shall mean the unlicensed manufacture, use or sale over a
period of at least two consecutive accounting quarters of products which
infringe the Licensed Patent where there is reason to believe the sales
volume of such infringement is equal to or exceeds an annual volume of
Twenty Five Thousand (25,000) Units by a single infringer. The burden of
initially showing Substantial Infringement shall be upon WATERLOO by a
preponderance, and the burden of subsequently showing termination or lack
of Substantial Infringement shall be upon HAWORTH by a preponderance.
However, XXXXXXX'x ongoing litigation with Steelcase shall not be
considered as activity against an infringer identified by WATERLOO
hereunder. Further, if HAWORTH is at any time litigating the '798 patent
against an infringer, other than the pending litigation with Steelcase,
then HAWORTH shall have no obligation to simultaneously litigate the patent
against other infringers.
4.2 With respect to XXXXXXX'x competitors in the office furniture
business which are considered not to be direct competitors with WATERLOO,
HAWORTH agrees to make reasonable efforts consistent with its sound
business judgment to enforce the '798 patent against such infringers,
provided however, that XXXXXXX'x opinion and decision as to whether to
initiate litigation against parties that are not direct competitors with
WATERLOO shall be accepted as final by WATERLOO.
VII-5. HAWORTH agrees not to license the '798 patent or any
corresponding foreign patent for manufacture outside of Canada or the United
States of America for importation into the United States of America. If HAWORTH
issues a license for such importation, then WATERLOO shall submit appropriate
written notice to HAWORTH and, if HAWORTH fails to take steps to stop such
importation within sixty (60) days following receipt of such notice, then
WATERLOO shall continue to be licensed, but may cease payment of royalties and
any outstanding Settlement Payments due hereunder, without any future obligation
to HAWORTH for such ceased payments. Thereafter, at such time as HAWORTH stops
such licensed importation, royalty on sales subsequent to the cessation of
licensed importation shall be due and payable pursuant to section IV-1 above.
It is understood that it is not a license under this paragraph to provide an
importer a waiver of damages for past sales in settlement of an infringement
dispute.
VII-6. WATERLOO and/or its customers shall be solely responsible for the
design and manufacture of the Licensed Units. HAWORTH makes no warranty, either
expressed or implied, relative to the Licensed Units or the applications
thereof. WATERLOO agrees that it will be solely responsible for any and all
liability or damage which may arise solely as a result of said Licensed Units
which are manufactured by WATERLOO, and that it will indemnify, hold harmless
and defend HAWORTH relative to any such liability or damage. Provided, however,
to the extent HAWORTH purchases, uses or sells Licensed Units manufactured by
WATERLOO, WATERLOO will not indemnify, hold harmless or defend HAWORTH against
liability or damage relating to XXXXXXX'x actions with respect to such Licensed
Units, except to the extent such indemnification is required by law.
VII-7. WATERLOO expressly covenants that neither this Agreement nor
rights hereunder shall be, directly or indirectly, assigned, transferred,
divided or shared by WATERLOO to or with any other individual, firm, corporation
or association whatsoever, without the prior written consent of HAWORTH;
provided, however, that this Agreement may be assigned to a successor to
substantially all of the business of WATERLOO. No acquisition of the shares or
assets of WATERLOO nor any assignment of this Agreement, with or without the
consent of HAWORTH, shall operate to absolve any successor or assignee of
liability to HAWORTH for infringement of the Licensed Patent arising from acts
committed by the successor or assignee prior to the date of assignment.
VII-8. This Agreement shall be binding upon and shall, to the extent
provided in Section VII-7 above, inure to the benefit of the respective
successor and assigns of HAWORTH and WATERLOO.
VII-9. Nothing contained in this Agreement shall be construed as a
warranty or representation by HAWORTH that anything made, used or sold by
WATERLOO hereunder will be free from infringement of patents of any third party.
VII-10. Nothing contained in this agreement shall be construed as an
admission by WATERLOO that the '798 patent is valid.
VII-II. This Agreement sets forth the entire agreement and understanding
between the parties as to the subject matter of this Agreement and merges all
prior discussions between them, and neither of the parties shall be bound by any
conditions, definitions, warranties or representations other than as
expressively provided in this Agreement or as duly set forth on or subsequent to
the date hereof in writing and signed by a proper and duly authorized
representative of the party to be bound thereby.
VII-12. The various provisions of this Agreement, including Sections and
Subsections, shall be considered legally severable. In the event any term or
provision of the Agreement shall for any reason be held invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not effect any other term or provision hereof; and, in such event, this
Agreement shall be interpreted and construed as if such term or provision, to
the extent that same shall have been held to be invalid, illegal or
unenforceable, have never been contained herein.
VII-13. This Agreement is deemed to be executed and delivered within the
State of Michigan, and shall be construed, interpreted and applied in accordance
with the laws of the State of Michigan.
VII-14. WATERLOO acknowledges that XXXXXXX'x models AKP-10, AKP-19
keyboard support devices, as presently sold, do not infringe any U.S. patents of
WATERLOO. HAWORTH represents that the models AKPP-4, AKPT-3, AKP-2, AKPT- 1,
NAK-3, NAK-2 and NAK- 1, as presently sold, do not infringe any U.S. patents of
WATERLOO and WATERLOO acknowledges that representation.
IN WITNESS WHEREOF, this Agreement is executed in duplicate by duly
authorized representatives of the parties hereto as indicated below.
XXXXXXX, INC. WATERLOO FURNITURE COMPONENTS, LTD.
By: /s/ Xxxxx Elders__________ By: /s/Xxxxx Bowers__________
Title: VP Quality_________ Title: ____Chairman_______
Date12/23/92________________ Date: 12/28/92________________
WATERLOO FURNITURE COMPONENTS, INC.
By: /s/ Xxxxx Xxxxxx
Tite: Chairman
Date: 12/28/92
Attachment: Addendum A
Witness: Witness:
/s/ Xxxxxxxx X. Xxxxxxx /s/ Xxx Xxxx
ADDENDUM
Waterloo Furniture Components, Ltd. Products Within The License:
Model 4110
Model 4120
Model 4130
Model 4140
Model 4150
Model 4160
Model 4190
Model 6130
Model 6135
Model 6140
Model 6150
Model 6170
Model 6175
Model 6180
Model 6190
Model 5900
Model 4123
Model 4137
Model 4138
Model 4139
Model 4179
Model 6137
AMENDED SUMMARY
OF THE VOLUME OF WATERLOO UNITS
SOLD IN THE U.S.A.
Arm 1986 1987 1988 1989 1990 1991 Jan -
Nov
1992
4100 1,015 5,143 11,716 3,039 1,800 0 0
4110 2 129 683 138 3 0 0
4120 1,784 13,464 14,823 13,490 2,438 19 0
4130 2,211 9,732 12,050 16,695 8,602 12 0
4140 3,199 7,122 10,426 11,341 3,281 0 0
4150 901 8,510 6,272 5,300 2,297 0 0
4160 1,719 18,063 27,879 400 102 145 0
4190 470 4,697 7,530 6,637 1,988 0 0
6130 0 0 0 3,954 29,218 50,379 81,421
6140 0 0 0 3,040 155,45 158,44 162,62
7 4 2
6150 0 0 0 0 1,850 6,569 15,091
6170 0 0 0 0 0 0 6,962
6180 0 0 0 0 1 801 0
6190 0 0 2,938 4,202 6,600
5900* 0 0 0 0 0 0 395
Total 11,301 66,860 91,379 64,034 209,97 220,57 273,09
5 1 1
Conversion Kit
4123 0 0 0 0 0 0 0
4137 0 0 0 0 102 0 0
4138 0 0 0 0 80 0 0
4139 0 50 100 100 100 0 0
4179 0 0 0 0 0 0 0
6137 0 0 0 0 0 161 5
In the above chart, the 1986 numbers are from October 14
(issue date of the patent-in-suit) to the end of year. The
1992 numbers are year to date as of December 1, 1992.
