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EXHIBIT 10.26
This LICENSING AND SERVICES AGREEMENT (this "Agreement"), dated June 30,
1999 is by and among XXXXXXXXXX.XXX CORPORATION ("MetaStream"), and COMPUTER
ASSOCIATES INTERNATIONAL, INC. ("CA") and METACREATIONS CORPORATION
("MetaCreations").
For and in consideration of the agreements set forth below, MetaStream and CA
agree as follows:
ARTICLE 1. DEFINITIONS.
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1.01 Definitions. The following terms when used herein shall have the
meanings set forth below:
(1) "Agreement" shall have the meaning set forth in the heading.
(2) "CA Products or Services" shall mean (a) any software of CA developed
with the MetaStream Intellectual Property Rights, other than a stand
alone computer software product that functions as a digital graphics
and/or three-dimensional model authoring tool and which is sold through
third party distributors or directly by CA via the Internet; or (b) any
services provided by CA or any of its affiliates using the MetaStream
Intellectual Property Rights.
(3) "Claim" shall mean any civil, criminal, administrative or investigative
action or proceeding.
(4) "Confidentiality Agreement" shall mean the agreement between the
parties regarding each party's obligations with respect to confidential
information of the other party.
(5) "Indemnified Party" shall have the meaning set forth in Section 10.03.
(6) "Indemnifying Party" shall have the meaning set forth in Section 10.03.
(7) "MetaStream Intellectual Property Rights" shall mean all currently
existing intellectual property rights relating to the MetaStream
streaming 3D format and all related technologies, including without
limitation 2D and 3D content creation, capture, editing, transmission,
manipulation, display, optimization and user interface technologies,
worldwide arising under statutory or common law, and whether or not
registered or perfected, including all (a) patents and patent
applications owned or licensable by a party hereto; (b) rights
associated with works of authorship including copyrights, copyright
applications, copyright registrations, mask work rights, mask work
applications, mask work registrations; (c) rights relating to the
protection of trade secrets and confidential information; (d)
trademark, service xxxx and trade dress rights; (e) any rights
analogous to those set forth in this Section and any other proprietary
rights relating to intangible property; and (f) divisions,
continuations, renewals, reissues and extensions of the foregoing (as
and to the extent applicable) now existing, or hereafter filed, issued
or acquired.
1.02 Headings. The Article and Section headings are for
reference and convenience only and shall not be considered in the interpretation
of this Agreement.
ARTICLE 2. LICENSE GRANTS.
2.01 Source and Object Code License. MetaCreations hereby
grants to CA, and CA hereby accepts from MetaCreations, a perpetual, worldwide,
non-exclusive, non-transferable, personal license to access, use, copy, view,
display, modify and adapt, have modified and have adapted any and all of the
MetaStream Intellectual Property Rights possessed by MetaCreations in source and
object code form.
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2.02 Distribution License. MetaCreations hereby grants to CA,
and CA hereby accepts from MetaCreations, a perpetual, worldwide license to
distribute and license and have distributed and have sublicensed to end-users
the MetaStream Intellectual Property Rights as part of CA Products or Services.
ARTICLE 3. DELIVERY AND LICENSE FEE PAYMENT.
3.01 Delivery. MetaCreations shall deliver, in source code
form, one copy of the MetaStream Intellectual Property to CA on the date hereof.
3.02 License Fee Payment. In full consideration for the
rights licensed herein, CA shall pay to MetaCreations a non-refundable license
fee of U.S. $3,000,000 upon execution of this Agreement.
ARTICLE 4. METASTREAM SERVICES.
4.01 Designated Employees.
(a) During the three year period beginning on the date of execution of this
Agreement MetaStream shall make available the MetaStream employees (the
"Designated Employees") set forth on Exhibit B to work on matters full time at
the direction and supervision of CA.
(b) In general and in the aggregate, such employees' time shall be allocated
approximately one-third to maintenance and development of the MetaStream client,
one-third to core research and development of the MetaStream Intellectual
Property, and one-third to integration of the MetaStream Intellectual Property
into CA Products.
(c) MetaStream shall, subject to CA's consent (which will not unreasonably be
withheld), have the right to substitute individual employees for individuals
named in such Exhibit, or to replace employees who depart MetaStream employment,
provided in all cases that the replacement has similar levels and areas of
expertise. Notwithstanding the foregoing, should the majority of the first ten
employees named in the Exhibit not be available to CA at any time during the
course of this Agreement, then (i) CA shall have the right to immediately cease
making further payments hereunder (and its rights to use the Designated
Employees shall cease) and (ii) should such situation occur during the first
nine months of this agreement, CA shall have the option to terminate this
Agreement and, in such event, shall receive the sole and exclusive rights to use
the MetaStream Intellectual Property Rights for and in the conduct of any
business involving the performance of services and shall also be entitled to
succeed to the benefits of all service contracts then held by MetaStream.
4.02. Option. CA, at its sole option, shall have the
right to discontinue use of the Designated Employees as a group within 30 days
of the expiration of the second anniversary of this Agreement. In such case,
CA's rights to access to such employees shall cease, each of the amounts
otherwise due to MetaStream for the last four quarters of this agreement shall
be reduced by $750,000.
4.03 License to CA. CA shall have from MetaStream a fully
paid, perpetual, worldwide, non-exclusive, transferable license to access, use,
copy, view, display, modify, adapt distribute, sublicense, have modified, have
adapted, have distributed and have sublicensed any and all intellectual property
developed by the Designated Employees. MetaStream shall retain all right, title
and interest to any Intellectual Property Rights developed by the Designated
Employees.
ARTICLE 5. PAYMENT FOR SERVICES.
5.01 Fee. In full consideration for the services of the
Designated Employees, CA shall pay to MetaStream the following amounts:
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(a) $1,500,000 within ninety days after execution;
(b) $450,000 within 180 days after execution;
(c) $450,000 within 270 days after execution;
(d) $550,000 on each of the first anniversary of the date of
execution and 90, 180 and 270 days after the first anniversary of
the date of execution;
(e) $900,000 on each of the second anniversary of the date of
execution and 90, 180 and 270 days after the second anniversary
of the date of execution.
ARTICLE 6. LIMITATIONS.
6.01 MetaStream and MetaCreations each agree not to license
any of the MetaStream Intellectual Property Rights to any of the entities set
forth on Exhibit C provided, however, that this provision shall not apply to the
extent it would limit MetaCreations in the conduct of its normal course of
business of licensing and selling digital graphics products, nor shall it apply
to limit MetaStream's ability to distribute the MetaStream client software.
ARTICLE 7. [OMITTED]
ARTICLE 8. CONFIDENTIALITY.
The obligations of each party with respect to confidential
information of the other party which is received in connection with the
transactions contemplated by this Agreement shall be governed by the
Confidentiality Agreement. The source code versions of the MetaStream
Intellectual Property Rights shall be deemed Confidential Information of
MetaStream.
ARTICLE 9. REPRESENTATIONS AND WARRANTIES.
9.01 MetaStream and MetaCreations' Representations and
Warranties. MetaStream and/or MetaCreations represent and warrant that:
(1) MetaStream has received a license from MetaCreations to all of the
MetaStream Intellectual Property Rights in the form attached as Exhibit A.
(2) MetaStream and MetaCreations have all necessary rights and authority to
execute and deliver this Agreement and perform its obligations hereunder,
and nothing contained in this Agreement or in the performance of this
Agreement shall place MetaStream in breach of any other contract or
obligation; and
(3) the media on which the MetaStream Intellectual Property Rights is recorded
shall be free from defects in materials and workmanship for a period of 90
days after delivery. MetaStream's sole liability with respect to breach of
this warranty is to replace the defective media. Except as expressly
provided in this Section 9.01, MetaStream licenses the MetaStream
Intellectual Property Rights to CA on an "AS IS" basis.
(4) the components of the MetaStream Intellectual Property Rights will perform
in accordance with their related documentation.
Except as set forth above, MetaStream and MetaCreations makes no other
representations or warranties with respect to the MetaStream Intellectual
Property Rights, express or implied, including any warranty as to
merchantability or fitness for a particular purpose.
9.02 CA's Representations and Warranties. CA represents and
warrants that CA possesses all necessary rights and authority to execute and
deliver this Agreement and to perform its
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obligations hereunder, and nothing contained in this Agreement or in the
performance of this Agreement shall place CA in breach of any other contract or
obligation.
ARTICLE 10. INDEMNIFICATION.
10.01 MetaStream Indemnity. MetaStream shall defend, indemnify
and hold CA harmless from and against any loss, liability (including settlements
and judgments) or expenses (including reasonable attorneys' fees, expenses and
court costs) arising out of any inaccuracy, untruthfulness, breach or alleged
breach of any of the MetaStream and MetaCreations represenations and/or
warranties and any Claim that the MetaStream Intellectual Property or the use of
the MetaStream Intellectual Property infringes a trademark, trade secret,
copyright or patent of any third party . MetaStream shall indemnify CA from any
reasonable costs and expenses incurred in connection with the enforcement by CA
of the obligations of MetaStream under this Section 10.01.
10.02 CA Indemnity. CA shall defend, indemnify and hold
MetaStream harmless from and against any loss, liability (including settlements
and judgments) or expenses (including reasonable attorneys' fees, expenses and
court costs) arising out of any:
(1) Third party Claim relating to the inaccuracy, untruthfulness, breach or
alleged breach of any representation or warranty set forth in Section 9.02;
and
(2) Claim that a CA Product which includes any MetaStream Intellectual Property
Rights infringes a trademark, trade secret, copyright or patent of any
thrid party, except to the extent that the claim arises from the MetaStream
Intellectual Property Rights.
CA shall indemnify MetaStream from any reasonable costs and expenses incurred in
connection with the enforcement by MetaStream of the obligations of CA under
this Section 10.02.
10.03 Indemnification Procedures. If any third party Claim is
commenced against a party entitled to indemnification under Section 10.01 or
Section 10.02 (the "Indemnified Party"), notice thereof shall be given to the
party that is obligated to provide the indemnification (the "Indemnifying
Party") as soon as reasonably possible. If, after such notice, the Indemnifying
Party acknowledges that this Agreement applies with respect to such Claim, then
the Indemnifying Party shall be entitled, if it so elects, in a notice promptly
delivered to the Indemnified Party to immediately take control of the defense
and investigation of such Claim and to employ and engage attorneys reasonably
acceptable to the Indemnified Party to handle and defend the same, at the
Indemnifying Party's sole cost and expense. The Indemnified Party shall
cooperate, at the Indemnifying Party's cost, in all reasonable respects with the
Indemnifying Party and its attorneys in the investigation, trial and defense of
such Claim and any appeal arising therefrom; provided, however, that the
Indemnified Party may, at its own cost and expense, participate, through its
attorneys or otherwise, in such investigation, trial and defense of such Claim
and any appeal arising therefrom. No settlement of a Claim that involves a
remedy other than the payment of money by the Indemnifying Party shall be
entered into without the consent of the Indemnified Party. In any case, no
settlement of a Claim may be made by the Indemnified Party without the consent
of the Indemnifying Party. If after investigation of the facts known at the
time, the Indemnifying Party disputes its obligation to indemnify the
Indemnified Party, (1) the parties shall cooperate to ensure that timely and
adequate defense of the Claim is provided, (2) all costs shall initially be
shared equally and (3) the parties shall submit the dispute to the dispute
resolution procedure set forth in Article 13.
ARTICLE 11. DAMAGES.
11.01 Consequential Damages. IN NO EVENT SHALL EITHER PARTY BE
LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES
IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT (INCLUDING LOSS OF PROFITS,
USE, DATA, OR OTHER ECONOMIC ADVANTAGE), NO MATTER WHAT THEORY OF LIABILITY,
EVEN IF THE EXCLUSIVE REMEDIES PROVIDED FOR IN THIS AGREEMENT FAIL OF THEIR
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ESSENTIAL PURPOSE AND EVEN IF EITHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY
OR PROBABILITY OF SUCH DAMAGES. MetaCreations and MetaStream agree to assert no
claim against CA relating to the employment by CA of any current or future
MetaCreations or MetaStream employee. The provisions of this Article 11 allocate
the risks under this Agreement between the parties and the parties have relied
upon the limitations set forth herein in determining whether to enter into this
Agreement.
11.02 Limitation. Excluding each party's respective
confidentiality and indemnification obligations, in no event shall either
party's liability exceed the amounts paid under this Agreement.
ARTICLE 12. DISPUTE RESOLUTION.
Any dispute arising under this Agreement shall be considered
in person or by telephone by the individuals referenced in Section 14.02 within
seven business days of receipt of a notice from either party specifying the
nature of the dispute; provided, however, that a dispute relating to Article 8
shall not be subject to this Article 12. If after the time period set forth
above, such individuals are unable to resolve the dispute, it shall be submitted
to a senior manager for each party. If the senior managers are unable to resolve
the dispute in seven additional business days, then, unless the senior managers
otherwise agree in writing, either party may thereafter pursue its rights and
remedies under this Agreement by all available legal means.
ARTICLE 13. TERMINATION.
13.01 Termination for Breach of a Material Obligation. Either
party may terminate this Agreement at any time if the other party is in breach
of a material obligation or a material representation or warranty under this
Agreement, and such party fails to cure such breach within 30 days after notice
thereof is given by the non-breaching party.
13.02 Termination for Insolvency. Either party may, at its
option, immediately terminate this Agreement if a receiver is appointed for the
other party or its property; the other party is unable to pay its debts as they
mature, or makes an assignment for the benefit of its creditors; the other party
seeks relief or proceedings are commenced against the other party or on its
behalf under any bankruptcy, insolvency or debtor's relief law, and such
proceedings have not been vacated or set aside within 60 days from the date of
commencement thereof; or the other party is liquidated or dissolved.
13.03 No Waiver. The election of either party to terminate
this Agreement pursuant to Section 13.01 or Section 13.02 shall not serve to
waive, limit, bar or otherwise extinguish any rights that party may have to
pursue and recover any damages that party may have suffered or incurred due to
the breach of any term of this Agreement or any amounts properly accrued under
this Agreement up to the date of termination, subject to the provisions of
Article 10 and Article 11.
ARTICLE 14. MISCELLANEOUS.
14.01 Relationship of Parties.
(1) The relationship between CA and MetaStream shall, during the period covered
by this Agreement, be that of independent contractors, and neither party
has nor shall have any power, and neither party shall represent that it has
any power, to bind the other party or to assume or to create any obligation
or responsibility, express or implied, on behalf of the other party or in
its name.
(2) Neither party nor its employees or agents shall be considered, under the
provisions of this Agreement or otherwise, as having an employee status or
the status of an agent or partner of the other party, or shall be entitled
to participate in any plans, arrangements, or distributions by the other
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party pertaining to or in connection with any pension, stock, bonus, profit
sharing, health plans, or similar benefits for the other party's employees.
Each party shall meet all of its obligations and responsibilities as an
employer to its own employees under any federal, state or local laws,
regulations or orders now or hereafter in force, including, without
limitation, those relating to taxes, unemployment compensation or
insurance, arising out of its engagement of persons for the performance of
or contribution to the services performed hereunder.
14.02 Notices. All notices, requests, approvals,
authorizations or other communications and statements which are required or
permitted under this Agreement shall be in writing and shall be sent by
facsimile or recognized commercial overnight courier. Notices shall be effective
upon receipt. Notices shall be sent to the parties at the following addresses:
For MetaStream: MetaStream Corporation
00 X.X.X. Xxxxxxx, Xxxxx 000
Xxxxx Xxxxx, XX 00000
Attn: Xxxxxx Xxxx
Facsimile number: (000) 000-0000
For CA: Computer Associates International, Inc.
1 Computer Associates Xxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxx
Facsimile number: (000) 000-0000
With a copy to its General Counsel at the
same address
Either party may change its address or facsimile number upon notice given to the
other party.
14.03 Binding Agreement; Assignment. This Agreement, upon
execution by both parties, shall be binding upon the parties and their heirs,
successors, permitted assigns and legal representatives. Neither party shall be
permitted to assign this Agreement or delegate any obligations hereunder except
that either party may assign this Agreement (1) in connection with a merger
with, or sale of assets to, any party accepting the obligations hereof and
acquiring all or substantially all of the assets of the assigning party with a
view to carrying on the business or a relevant portion of the business of the
assigning party or (2) to any subsidiary, affiliate or parent entity of the
assigning party that also accepts the obligations of the assigning party
hereunder. The assigning party shall remain responsible for any of its
obligations hereunder after an assignment, if and to the extent the assignee
fails to perform the assigning party's obligations. Any assignment in
contravention of this Section shall be void.
14.04 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but both of which taken
together shall constitute one single agreement between the parties.
14.05 Consents, Approvals and Requests. Except as specifically
set forth in this Agreement, all consents and approvals to be given by either
party under this Agreement shall not be unreasonably withheld or delayed and
each party shall make only reasonable requests under this Agreement.
14.06 Severability. If any provision of this Agreement is held
by a court of competent jurisdiction to be contrary to law, then the remaining
provisions of this Agreement, if capable of substantial performance, shall
remain in full force and effect.
14.07 Waivers. No delay or omission by either party to
exercise any right or power it has under this Agreement shall impair or be
construed as a waiver of such right or power. A waiver by any party of any
breach or covenant shall not be construed to be a waiver of any succeeding
breach or any other covenant. All waivers must be signed by the party waiving
its rights.
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14.08 Amendments. No amendment to, or change, waiver or
discharge of, any provision of this Agreement shall be valid unless in writing
and signed by an authorized representative of each of the parties.
14.09 Survival. The provisions of Article 2, Article 4.03, ,
Article 8, Article 9, Article 10, Article 11 and this Article 14 shall survive
the expiration or termination of this Agreement.
14.10 Third Party Beneficiaries. Each party intends that this
Agreement shall not benefit, or create any right or cause of action in or on
behalf of, any person or entity other than the parties.
14.11 Governing Law. This Agreement and the rights and
obligations of the parties under this Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to the principles thereof relating to the conflicts of laws.
14.12 Sole and Exclusive Venue. Each party irrevocably agrees
that any legal action, suit or proceeding brought by it in any way arising out
of this Agreement must be brought solely and exclusively in the United States
District Court for the Southern District of New York or in the state courts of
the State of New York and irrevocably accepts and submits to the sole and
exclusive jurisdiction of each of the aforesaid courts in personam, generally
and unconditionally with respect to any action, suit or proceeding brought by it
or against it by the other party; provided, however, that this Section shall not
prevent a party against whom any legal action, suit or proceeding is brought by
the other party in the state courts of the State of New York from seeking to
remove such legal action, suit or proceeding, pursuant to applicable Federal
law, to the district court of the United States for the district and division
embracing the place where the action is pending in the state courts of the State
of New York, and in the event an action is so removed each party irrevocably
accepts and submits to the jurisdiction of the aforesaid district court. Each
party hereto further irrevocably consents to the service of process from any of
the aforesaid courts by mailing copies thereof by registered or certified mail,
postage prepaid, to such party at its address designated pursuant to this
Agreement, with such service of process to become effective 30 days after such
mailing.
14.13 Covenant of Further Assurances. MetaStream and CA
covenant and agree that, subsequent to the execution and delivery of this
Agreement and without any additional consideration, each of MetaStream, and CA
shall execute and deliver any further legal instruments and perform any acts
that are or may become reasonably necessary to effectuate the purposes of this
Agreement.
14.14 Negotiated Terms. The parties agree that the terms and
conditions of this Agreement are the result of negotiations between the parties
and that this Agreement shall not be construed in favor of or against any party
by reason of the extent to which any party or its professional advisors
participated in the preparation of this Agreement.
14.15 Remedies Cumulative. No specific remedy under this
Agreement shall limit a party's right to exercise all other remedies available
to such party under law, in equity or under this Agreement, and all such
remedies shall be cumulative.
14.16 Publicity. The parties agree to issue (a) joint press
releases regarding the licensing of the MetaStream Intellectual Property Rights
for integration into various CA Products.
14.17 Entire Agreement. This Agreement and the Confidentiality
Agreement constitute the entire agreement and understanding between the parties
hereto with respect to the subject matter thereof and supersedes any and all
other agreements, written or oral, that the parties heretofore may have had with
respect to the subject matters herein.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective duly authorized representatives as
of the day and year first above written.
XXXXXXXXXX.XXX CORPORATION
By: /s/ XXXX XXXXX
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Name: Xxxx Xxxxx
Title: Chief Executive Officer
COMPUTER ASSOCIATES INTERNATIONAL, INC.
By: /s/ XXXXX XXXXXXX
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Name: Xxxxx Xxxxxxx
Title: Senior Vice President
METACREATIONS CORPORATION
By: /s/ XXXXXXX X. XXXXXXXXX
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Name: Xxxxxxx X. Xxxxxxxxx
Title: Chief Financial Officer
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