Supply and License Agreement
This
Agreement is made and entered into as of April 16, 2003, (“Effective Date”) by
and between Wintegra, Inc., a Delaware corporation with its principal place
of
business located at 0000 Xxxxx XxXxx Xxxxxxxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000,
Wintegra Ltd., a company incorporated under the laws of Israel with its
principal place of business located at 6 Xxxxxxxx Xx. X.X. Xxx 0000, 00000
Xx'xxxxx Xxxxxx (Wintegra, Inc. and Wintegra, Ltd shall be referred to as
"Wintegra" or “Licensor”) and Texas Instruments Incorporated, a Delaware
corporation with its principal place of business located at 00000
XX
Xxxxxxxxx, Xxxxxx, Xxxxx, 00000 (“TI” or “Licensee”) (collectively, the
“Parties,” or individually, each a “Party”).
Whereas,
the Parties will enter into a separate agreement entitled “Co-Marketing and
Software License Agreement” to jointly market the High Density Solution (as
defined below),
Whereas,
Wintegra acknowledges that TI, as a supplier of TI chipsets in a High Density
Solution, and its customers using a High Density Solution are critically
dependent on a continuity of supply of Wintegra software and chips, and that
TI
and such customers could suffer material damage due to any lack of supply of
Wintegra Products (as defined below),
Whereas,
the Parties acknowledge that customer supply problems regarding Wintegra
Products should be addressed and solved directly by Wintegra, but in certain
circumstances after Wintegra has been provided reasonable opportunity, as
described in this Agreement, to remedy breaches in supply but has been unable
to
do so, TI shall have the right to independently develop, manufacture or have
manufactured, distribute, and support Wintegra products or products having
the
same or similar functionality as the Wintegra portions of the High Density
Solution, and
NOW,
THEREFORE, the Parties agree that the consideration each Party is providing
is
adequate, and in consideration of the foregoing premises and the mutual promises
and covenants set forth below, TI and Wintegra mutually agree as follows:
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1.
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Definitions
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“Acquiring
Party”
shall
mean a third party who acquires Wintegra Inc. or Wintegra Ltd.
upon
the effective date of a Change of Control (as defined below).
"Change
of Control"
shall
mean: (a) when any person or group (within the meaning of Rule 13d-5 under
the
Securities Exchange Act of 1934 as in effect on the date hereof) shall come
to
own, directly or indirectly, beneficially or of record, voting securities
representing more than fifty percent (50%) of the total voting power of
Wintegra; (b) Wintegra becomes a Subsidiary (as defined below) of a third party;
or (c) Wintegra sells all or substantially all of its assets to a third party,
or sells all or substantially all of its assets comprising or relating to
Wintegra Products to a third party.
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1
“Derivative
Product(s)”
shall
mean successor versions of the Wintegra Winpath 777 chip, including the, XXX000,
XXX000, and WIN707, as well as other versions that could or would typically
be
used as part of a High Density Solution.
“Escrow
Materials”
shall
mean any and all technical information, whether in the form of drawings,
schematics, layouts, plans, architectures, tools, mathematical models, data,
formulae, algorithms, methods, guidelines, practices, prototypes, tests and
reports, as well as all computer software, including source code, firmware,
and
hardware or other documents which are reasonably necessary for TI to
manufacture, use, and maintain the Wintegra Chips, Licensed Software, Wintegra
Products, TI High Density Chips, and TI High Density Solution without any
assistance provided by Wintegra or its successor.
The
Escrow Materials shall include, at a minimum, the following:
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·
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[†]
with signal names and instance
names
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·
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[†]
and [†] Library
information
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·
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[†]
indicating where the major components of the design exist on the
die
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·
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Documentation
including but not limited to: [†] rules, [†]
conditions, [†]
metrics
([†] metrics,
etc.) [†] description, [†]
analysis
and [†] assumptions, [†]
specs,
which [†] library
was used
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·
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Source
Code for Licensed Software
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·
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[†]
Software [†] in
source code
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·
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[†]
tools consisting of [†] code
(including extensions), [†] and
all other [†] software
delivered by [†] to
customers, and [†] development
tools ([†] ,
etc.) (these items collectively [†] )
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·
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All
documentation, source code, and version control archives for the
[†]
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·
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[†]
tools
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·
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[†]
vectors
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·
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[†]
model
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_____________________
[†]
Information redacted pursuant to a confidential treatment request by Wintegra,
Inc. under 17 CFR §§ 200.80(b)(4) and 230.406 and submitted separately with the
Securities and Exchange Commission.
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2
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·
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Test
cases used to verify the [†]
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·
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[†]
setup and scripts
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·
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[†]
results
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·
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[†]
drop analysis
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·
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[†]
database file for the [†]
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·
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[†]
functionality specification for the [†]
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“Fabrication
Source(s)”
shall
mean any third party entity that Wintegra contracts to
manufacture,
package, or test Wintegra Products.
“High
Density Solution”
shall
mean a solution comprised of (i) Wintegra Chips (as defined below) and (ii)
Licensed Software (as defined below), and (iii) a TI TNETV3000/3010 chipset
or a
TI 64x chipset (including multi-core derivatives) and derivatives of those
chipsets. The Parties agree that such High Density Solution may be incorporated
into a variety of products, including, but not limited to DSLAM, DLC, CMTS,
RAS,
Packet-based Class 4 Switch, Packet-based Class 5 Switch, and wireless
infrastructure products.
“Licensed
Software”
shall
mean those computer programs and instructions listed in Appendix 1 in Object
Code or Source Code and associated documentation. Licensed Software includes
all
Updates, Upgrades, translations, compilations, or other software delivered
to TI
by Wintegra.
“Mutual
Customer(s)”
shall
mean customers or potential customer of the High Density Solution that (i)
are
listed in Appendix 5, or (ii) that the Parties agree in written communications
(including e-mail correspondence) shall be Mutual Customers. For a customer
to
be deemed a Mutual Customer under (ii), such written communication must be
signed or acknowledged via e-mail by the CEO of Wintegra and the TI Voice Over
Packet General Manager , or such Manager's supervisor.
“Significant
Customer(s)
shall
mean those Mutual Customers to whom TI has offered certain assurances as part
of
a written agreement between TI and the Significant Customer regarding the
continuous supply of Wintegra Chips and the Licensed Software, or reasonable
substitutes thereof. Significant Customers shall be listed in Appendix 5, which
is attached and incorporated by reference. Appendix 5 may be amended or updated
upon mutual agreement between TI and Wintegra.
_____________________
[†]
Information redacted pursuant to a confidential treatment request by Wintegra,
Inc. under 17 CFR §§ 200.80(b)(4) and 230.406 and submitted separately with the
Securities and Exchange Commission.
Page
3
“Subsidiary”
shall
mean a corporation, company or other entity (a) fifty percent (50%) or more
of
whose outstanding shares or securities representing the right to vote for the
election of directors or other managing authority are, or (b) which does not
have outstanding shares or securities, as may be the case in a partnership,
joint venture or unincorporated association, but at least fifty percent (50%)
of
whose ownership interest representing the right to make the decisions for such
corporation, company or other entity is, now or hereafter, owned or controlled,
directly or indirectly, by a Party hereto.
“TI
High Density Chip(s)”
shall
mean chipsets, integrated circuits, or core logic developed by or for TI using
the Escrow Materials, which would replace and/or upgrade Wintegra Chips. For
clarification purposes, "TI High Density Chip" shall not mean the TI
TNETV3000/3010 chipset or TI 64x chipset.
“TI
High Density Solution”
shall
mean a solution that will perform similar or identical functions as the Wintegra
Chips and Licensed Software, and is comprised of (i) object code software
developed using all or portions of the source code portions of the Escrow
Materials (and shall not include source code versions of the Escrow Materials)
and (ii) TI High Density Chips.
“Updates”
shall
mean new versions of the Licensed Software or Modifications made available
by
Wintegra to its existing customers of the Licensed Software that contains bug
fixes/and or minor enhancements or improvements, but does not contain
significant new features.
“Upgrades”
shall
mean new versions of the Licenses Software or Modifications made available
by
Wintegra to its existing customers of the Licensed Software that contains major
enhancements and new features.
“Wintegra
Chips”
shall means
the
WinPath 777 chip described in Appendix 1 and Derivative Products.
“Wintegra
Products”
shall
means Wintegra’s Winpath solution that (i) contains the Licensed Software and
(ii) Winpath 777 chip and/or Derivative Products developed by or for Wintegra
and manufactured by Wintegra’s Fabrication Source.
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2.
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Wintegra’s
Obligation to Ensure Continuous Supply of Wintegra
Products
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The
Parties acknowledge that they share the common goal of ensuring that Mutual
Customers have a continuous supply of Wintegra Products. Wintegra agrees to
use
its best efforts to ensure that the supply of Wintegra Products to Mutual
Customers is timely and remains uninterrupted. TI agrees that the needs of
the
Parties’ Mutual Customers are best served if Wintegra communicates directly with
Mutual Customers on Wintegra Product supply issues. TI agrees to facilitate
discussions between Wintegra and Mutual Customers regarding Wintegra Product
supply issues. Wintegra further agrees that, if, despite such discussions with
Mutual Customers, it is unable to timely and adequately meet the supply needs
of
Mutual Customers, Wintegra will use its best efforts, working diligently with
TI
and all relevant third parties, to enable TI to design, manufacture or have
manufactured, distribute, modify, and support Wintegra Products, Licensed
Software, Wintegra Chips, TI High Density Chips, and/or an TI High Density
Solution. At a minimum, Wintegra will perform the obligations specifically
set
forth in this Agreement so as to attain these goals.
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4
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3.
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Agreement
from Wintegra’s Fabrication
Sources
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Wintegra
warrants that within thirty (30) days of the Effective Date of this Agreement,
all of its Fabrication Sources have executed an agreement with Wintegra and
TI
in the form of Appendix 2. If, during the term of the Agreement, Wintegra
changes or adds Fabrication Sources, Wintegra shall (i) notify TI in writing
as
soon as practicable and (ii) require such new Fabrication Source(s) to sign
such
agreement with Wintegra and TI, and shall use best efforts to obtain the
new
Fabrication Source’s signature within fourteen (14) days after such new
Fabrication Source commences work for Wintegra.
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4.
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Escrow
Deposit
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Within
seven (7) days after (i) TI establishes an escrow account with the escrow
agent,
(ii) the delivery of each Update or Upgrade by Wintegra to TI under the terms
of
the Parties’ Co-Marketing and Software License Agreement, and (iii) general
release of a Derivative Product, Wintegra shall deposit the then most current
version of the Escrow Materials with an escrow agent selected by the Parties.
Such deposits shall be made in accordance with an escrow agreement substantially
in the form of the agreement attached as Appendix 3 (the “Escrow Agreement”) to
be entered into between the Parties and the escrow agent. TI shall bear any
costs of the escrow or of the escrow agent.
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5.
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Licenses
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TI
High Density Solution
Subject
to Section 8, Wintegra hereby grants TI a worldwide, non-exclusive,
non-transferable license under all such necessary and applicable Wintegra
intellectual property (including but not limited to copyright, patent, mask
works, trade secret rights and know-how), to, upon the occurrence of a Release
Condition described in Appendix 4 (“Release Condition”), (i) make copies,
prepare derivative works, display, and use the Escrow Materials for the purpose
of designing, developing, making, having made, and supporting a TI High Density
Solution, TI High Density Chips, and derivatives of the Licensed Software (this
includes permission for TI or its contractor to emulate the electrical
characteristics and performance of the Wintegra Product or Wintegra Chip) and
(ii) sell, offer to sell, and otherwise distribute or transfer TI High Density
Solutions, TI High Density Chips, Licensed Software, and derivatives of the
Licensed Software to TI customers and TI distributors.
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5
Notwithstanding
the foregoing, if the sole Release Condition that occurs is Release Condition
B
(Change of Control of Wintegra), then TI agrees that its development of a TI
High Density Chip shall be limited to a chip that has the same or similar
functionality as the Wintegra Chips, but shall not contain features that are
significant upgrades from the Wintegra Chips.
Wintegra
Product
Subject
to Section 8, Wintegra hereby grants TI a worldwide, non-exclusive,
non-transferable license under all such necessary and applicable Wintegra
intellectual property (including but not limited to copyright, patent, mask
works, trade secret rights, and know-how) to, upon the occurrence of a Release
Condition, (i) make copies, prepare derivative works, display, and use the
Escrow Materials for the purpose of supporting Wintegra Products, Wintegra
Chips, and the Licensed Software, and managing the manufacture of Wintegra
Chips
at Wintegra’s Fabrication Sources; and (ii) sell, offer to sell, and otherwise
distribute or transfer Wintegra Products, and Wintegra Chips to TI customers
and
TI distributors.
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6.
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Notification
of Release Condition
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Wintegra
agrees to notify TI in writing (i) immediately upon the occurrence of any of
the
Release Conditions described in Appendix 4 and (ii) as soon as practicable
when
Wintegra receives information that a Release Condition is likely to occur.
Such
notice shall be made in accordance with Article 15 entitled “Notices” in this
Agreement with a copy to the person named below and shall detail the alleged
Release Condition or potential Release Condition.
General
Manager, TI Voice Over Packet General Manager
00000
Xxxxxxx Xxxx.
Xxxxxxxxxx,
XX 00000
TI
agrees
that prior to requesting release of the Escrow Materials, it will notify
Wintegra in writing at least seven (7) days prior of such release request and
will use good faith, reasonable efforts to work with Wintegra in a timely manner
to find a mutually agreeable alternative to TI obtaining the Escrow Materials
and exercising the licenses granted in this Agreement.
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6
The
parties agree that the issuance by Wintegra of an End of Life notification
(“EOL”) in accordance with legitimate business considerations and Wintegra’s
standard EOL policies, shall not, in and of itself, constitute a Release
Condition (for example, a legitimate business consideration would be i) minimal
customer demand for the Wintegra Product, or ii) transition to next-generation
product. Wintegra’s exiting of a viable market would not be a legitimate
business consideration). Wintegra agrees that a standard EOL would include
a
minimum of [ †]
written
notice to TI and [†] written notice to the customer of such EOL event and an
opportunity for the customer to make a purchase of Wintegra Products subject
to
such EOL.
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7.
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Requirements
upon Occurrence of Release
Condition
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If
any of
the Release Conditions specified in Appendix 4 of this Agreement occur, and,
despite each Parties’ good faith efforts to negotiate an alternative to the
release of the Escrow Materials, the Parties are unable to reach such an
agreement, then:
a. Wintegra
will use best efforts to work with TI, all Fabrication Sources, and the
Acquiring Party (if relevant) to ensure that the Fabrication Sources supply
TI,
TI’s contractors, or TI’s distributors with the Wintegra Chips on terms as least
as favorable as the terms in the supply agreement Wintegra has entered into
with
each Fabrication Source for Wintegra Products.
b. Immediately
upon request by TI, Wintegra shall physically transfer the reticles that are
used to make the Wintegra Products to TI or any other third party identified
by
TI
c. Wintegra
shall arrange for the employees below to assist TI in implementing the
development, manufacture, distribution, and support of products as described
in
this Agreement, and shall allocate such employees’ other responsibilities in a
manner that will allow such employees to assist TI in a timely manner. If such
employees are not available, Wintegra shall arrange for persons with comparable
experience and knowledge to assist TI.
Manufacturing:
[†]
Software:
[†]
Software:
[†].
d. TI
shall be entitled to notify the escrow agent in writing (with a copy to
Wintegra) of such Release Condition. The escrow agent shall notify Wintegra
of
TI’s notification and shall release the Escrow Materials subject to the terms
of
this Agreement and the Escrow Agreement. Wintegra agrees it shall not challenge
the escrow agent’s release of the Escrow Materials. If Wintegra believe that,
contrary to TI’s notification to the escrow agent, a Release Condition has not
occurred, Wintegra will nevertheless permit the release of the Escrow Materials,
but may challenge the occurrence of a Release Condition through arbitration
as
described in the Escrow Agreement. During the period between the release of
the
Escrow Materials and decision of the arbitrator(s) (the “Interim Period”), TI
shall pay Wintegra [ †]
of the
Profits (as defined in Section 8 below) from TI's sale of the TI High Density
Chip or Wintegra Chip during the Interim Period. If the arbitrator(s) determines
that a Release Condition did indeed occur, TI will continue supplying its
customers as described in this Agreement, and will receive [†] for the amounts
[†]. If the arbitrator(s) determines that the Release Condition did not occur,
TI will return the Escrow Materials to the escrow agent, and Wintegra will
resume supplying Mutual Customers directly.
_____________________
[†]
Information redacted pursuant to a confidential treatment request by Wintegra,
Inc. under 17 CFR §§ 200.80(b)(4) and 230.406 and submitted separately with the
Securities and Exchange Commission.
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7
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8.
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Royalties
and Joint Ownership Buy-Out
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For
purposes of this section and section 7, “Profits" shall be defined as [†]. In
the event that the “TI High Density Chip” is integrated into a chipset,
integrated circuit, or DSP that includes functionality in addition to the TI
High Density Chip functionality, then, for purposes of determining the Profits
generated from the TI High Density Chip, the parties shall negotiate in good
faith to [†].
Notwithstanding
the [†] set forth below, the parties may mutually agree at any time a [†]
for
a
[†]
to
[†].
8.1 Wintegra’s
Insolvency.
If a
Release Condition described in Appendix 4, Part A (Insolvency) occurs, and
TI
desires to exercise the licenses granted in Section 5 of this Agreement, TI
shall pay Wintegra a [†] of [†]
received
from [†]
of the
[†],
calculated in the following manner, beginning from the date of the Release
Condition:
For
thirty-six (36) months after the Release Condition - [†] of [†]
Thirty-seven
(37) months through forty-eight (48) months - [†] of [†]
After
forty-eight months - [†] due to [†]
from
[†]
Notwithstanding
the foregoing, if a Release Condition described in Appendix 4, Part A occurs,
TI
shall have no obligation to [†]
any
[†]
upon the
earlier of (i) the [†]
of
[†]
as a
[†]
, (ii)
[†]
of the
[†]
, or
(iii) [†]
after
the [†]
of the
[†].
For
clarification purposes, after (i), (ii), or (iii) occurs, [†]
shall
[†]
more
[†],
but the
[†]
described in [†]
shall
continue [†].
8.2 Other
Release Conditions.
If any
other Release Condition described in Xxxxxxxx 0, xxxxxx (Xxxxxx of Control,
Force Majeure, Unexcused Failure to Timely Supply), and TI desires to exercise
the licenses granted in Section 5 of this Agreement, TI shall TI shall pay
Wintegra a [†] of [†]
from
[†]
of the
[†],
calculated in the following manner, beginning from the date of the Release
Condition:
_____________________
[†]
Information redacted pursuant to a confidential treatment request by Wintegra,
Inc. under 17 CFR §§ 200.80(b)(4) and 230.406 and submitted separately with the
Securities and Exchange Commission.
Page
8
For
thirty-six (36) months after the Release Condition - [†] of [†]
Thirty-seven
(37) months through seventy-two (72) months - [†] of [†]
Seventy-three
(73) months and beyond - [†]
of
[†]
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9.
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Customer
Pricing, Licensing, and
Support
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a.
If the Release
Condition that occurs is a force majeure event and TI chooses to distribute
Wintegra Products to certain customers, TI will honor any pricing commitment
that Wintegra has made to such customers, or negotiate another agreement with
the customer. TI shall be not be obligated to assume the rights and obligations
of Wintegra under Wintegra’s agreements with such Mutual Customers.
b.
Upon release
of the Escrow Materials, TI may, at TI’s sole option, assume Wintegra’s rights
and obligations under all or some of Wintegra’s customer contracts, or TI may
enter into new contracts with such customers. Wintegra agrees to execute any
and
all documents necessary to give full effect to such assumption of rights and
obligations.
c. Upon
release of the Escrow Materials, at TI’s option, TI shall subcontract Wintegra
to continue to supply support to Mutual Customers.
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10.
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Title
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Title
to
the Escrow Materials, including all copies thereof, shall be in and remain
with
Wintegra. TI shall own all right, title and interest to the intellectual
property rights (including, but not limited to mask works rights, copyrights,
trade secret, and patent rights) in derivatives works of the Escrow Materials
resulting from TI's work with and contribution of TI intellectual property
to
such Escrow Materials, subject to Wintegra’s ownership of the underlying Escrow
Materials. TI shall maintain title to all software, hardware and other
intellectual property belonging to TI before the Effective Date, and any
original software, hardware or other intellectual property independently
developed by TI after the Effective Date and incorporated in or added to the
Escrow Materials, and may use such software, hardware or other intellectual
property without restriction when not combined with the Escrowed Materials.
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11.
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Confidentiality
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11.1
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Confidentiality
Terms
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_____________________
[†]
Information redacted pursuant to a confidential treatment request by Wintegra,
Inc. under 17 CFR §§ 200.80(b)(4) and 230.406 and submitted separately with the
Securities and Exchange Commission.
Page
9
During
the course of the Term of this Agreement, either Party ("Disclosing Party")
may
disclose certain Confidential Information to the other Party ("Receiving
Party"). “Confidential Information” may include any data or information, oral,
or written, that relates to either Party's (or, if either Party is bound to
protect the confidentiality of any other person's information, such other
person's) past, present, or future research, development, technology, products,
personnel, or business activities, including, but not limited to, any
unannounced products, software, and services, and including any information
relating to services or the technology, developments, inventions, software,
expertise, processes, trade secrets, filed patents, know how, Source Code,
plans, financial information, customer and supplier lists, forecasts, and
projections. The Parties agree that all information a Party desires to be deemed
Confidential Information shall be conspicuously marked or otherwise identified
as Confidential Information of the Disclosing Party at the time of disclosure
or, if disclosed in an intangible form, shall be followed by a writing
identifying the information as confidential within thirty (30) days of first
disclosure thereof. Confidential Information includes the terms of this
Agreement (except as set forth herein), and any material considered confidential
under any NDA signed between the Parties prior to entering this Agreement.
The
Party receiving any such Confidential Information shall treat such Confidential
Information as confidential and proprietary of the Disclosing Party for a period
of five (5) years from first receipt thereof and for this term shall not use,
disclose, or otherwise exploit any Confidential Information for any purpose
not
expressly contemplated by this Agreement. Each Party shall require each of
their
employees, independent contractors, agents or representatives who have access
to
the Confidential Information to execute a written confidentiality agreement
containing terms substantially similar to those set forth in this Agreement
or
shall have form employee or consultant agreements and procedures to ensure
their
execution where these agreement are reasonably protective of confidential
information according to software industry standard practices.
Notwithstanding
the foregoing, Confidential Information is deemed not to include information
that:
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(i)
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is
publicly available or in the public domain at the time that information
disclosed;
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(ii)
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is
or becomes publicly available or enters the public domain through
no fault
of the Party receiving such information;
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(iii)
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is
rightfully communicated to the recipient by persons not bound by
confidentiality obligations with respect thereto where confidential
obligations were not placed on
recipient;
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(iv)
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is
already, at the time of disclosure, in the recipient's possession
and free
of any confidentiality obligations with respect thereto (excluding,
however, any copies of the Licensed Software that may be in TI's
possession or provided to TI prior to the date of this
Agreement);
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(v)
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is
independently developed by the recipient without use of any Confidential
Information, and such independent development can be shown by recipient;
or
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Page
10
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(vi)
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is
approved for release or disclosure by the disclosing Party without
restriction.
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The
Parties agree that if the Escrow Materials are released, the above
confidentiality terms shall apply.
11.2
Disclosure of Terms of this Agreement to Certain TI
Customers
Notwithstanding
the confidentiality terms in this Agreement, the Parties agree that the other
Party has the right to disclose the terms of this Agreement (this includes
the
right to provide a copy of a fully executed version of this Agreement), except
for (i) Appendix 5 (“Significant Customers”), (ii) Section 8 (iii) names listed
in Section 7(c), (iv) royalty amounts in Section 7(d) and (v) the competitor
list in Appendix 4.B.1, to any potential customer of the High Density Solution,
if such potential customer has inquired into the possibility of Wintegra’s
inability to maintain a continuous supply of Wintegra Chips and/or Licensed
Software and if the disclosing Party has the prior written approval from the
nondisclosing Party. Approval by the nondisclosing Party shall not be
unreasonably withheld or delayed. TI and Wintegra each have the right to make
press announcements regarding the Agreement, as long as written approval from
the other Party has been obtained. Such prior approval shall not be unreasonably
withheld or delayed.
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11.3
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Pending/Potential
TI Projects
|
Wintegra
acknowledges that (i) TI is has worked, may be working on, and may continue
to
work on developing technology that is similar to, that competes with, or
replaces any or all of the technology embodied in the Escrow Materials; and
(ii)
TI may continue to develop such technology in the future. Nothing in this
Agreement shall be construed as precluding TI from proceeding with any such
development or distribution now or in the future, or from implementing and
distributing such technology developed in the past. Nothing in this Agreement
shall prevent TI from using information in non-tangible form that may be
retained in the unaided memories of persons who have had access to the Escrow
Materials, including ideas, concepts, know-how or techniques contained therein
(“Residuals”). TI shall have no obligation to limit or restrict the assignment
of such persons or to pay royalties for any work resulting from the use of
residuals, except as may arise under valid patents, copyrights or
trademarks.
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12.
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Warranties
|
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12.1
|
Warranty
of Non-Infringement
|
Wintegra
warrants that: (i) the Escrow Materials, Wintegra Products, Wintegra Chips,
and
Licensed Software do not violate any third party trade secrets, mask works
rights, or copyrights, (ii) as of the Effective Date of this Agreement, Wintegra
is not aware of any potential or actual third party patent claim on the Escrow
Materials, Wintegra Products, Wintegra Chips, or Licensed Software, and (iii)
no
additional royalties, except those described below, will be due from TI to
any
third parties for the use or distribution of the Escrow Materials, Wintegra
Products, Wintegra Chips, Licensed Software as described in this Agreement.
Page
11
Wintegra
agrees to, within [†]
from the
Effective Date of this Agreement, secure from [†] and [†] the right to
sublicense to TI (on terms at least as favorable as the licensing terms in
this
agreement) such third party intellectual property rights necessary for TI to
exercise all licenses granted in this Agreement. Any royalties due to such
third
parties shall reduce TI's Profits as defined in Section 8. If a Release
Condition occurs and Wintegra has not secured TI such rights, then Wintegra
agrees to pay any license fees due to such third parties that are necessary
for
TI to exercise all licenses granted in this Agreement.
|
12.2
|
Warranty
of Title.
|
Wintegra
represents and warrants that it has sufficient right, title, and interest in
the
Escrow Materials and Licensed Software to license them to TI as set forth in
this Agreement.
|
12.3
|
Warranty
regarding Escrow
Materials.
|
Wintegra
represents and warrants that the materials included in the Escrow Materials
are
adequate for a semiconductor manufacturer like TI to manufacture, modify, use,
and maintain the Wintegra Chips, Licensed Software, Wintegra Products, TI High
Density Chips, and TI High Density Solution without any assistance provided
by
Wintegra or its successor.
THE
WARRANTIES ABOVE ARE EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES, WHETHER
EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE.
NO
WARRANTY SHALL APPLY TO THE EXTENT DEFECTS, FAILURES, DAMAGE, OR LOSS RESULTING
FROM CORRECTIONS, REPAIRS OR SERVICE ARE NECESSITATED BY:
|
(A)
|
TI’S
OR THE ULTIMATE USER’S SYSTEM, OTHER EQUIPMENT OR ITS
USE;
|
|
(B)
|
ANY
ACT OR OMISSION BY ANYONE OTHER THAN WINTEGRA OR ITS
CONTRACTORS;
|
|
(C)
|
POWER
SHORTAGES, IRREGULARITIES, OR FAILURES;
OR
|
|
(D)
|
MODIFICATION
OF THE LICENSED SOFTWARE BY ANYONE OTHER THAN
WINTEGRA.
|
_____________________
[†]
Information redacted pursuant to a confidential treatment request by Wintegra,
Inc. under 17 CFR §§ 200.80(b)(4) and 230.406 and submitted separately with the
Securities and Exchange Commission.
Page
12
|
13.
|
Indemnity
|
Wintegra
will defend any claim, suit, or proceeding brought against TI and will pay
any
damages or court costs finally awarded against TI, or agreed to by TI in
settlement or compromise, to the extent such claim, suit, or proceeding is
based
on an allegation that the Escrow Materials, Wintegra Products, Wintegra Chips,
or Licensed Software, or the use or distribution thereof in accordance with
this
Agreement, directly or indirectly infringes (including claims for inducement
or
contribution) any duly issued patent, copyright, mask works right, or other
intellectual property right, provided that TI (i) promptly notifies Wintegra
of
such claim, suit, or proceeding, (ii) gives Wintegra all applicable evidence
in
TI’s possession, custody, or control, and (iii) gives Wintegra reasonable
assistance in and sole control of the defense thereof and all negotiations
for
its settlement or compromise.
|
14.
|
Limitation
of Liability
|
|
14.1
|
TI
|
EXCEPT
FOR TI’S CONFIDENTIALITY OBLIGATIONS UNDER SECTION 11 AND TI’S OBLIGATIONS
DESCRIBED IN SECTION 5 (LICENSES), IN NO EVENT WILL TI'S TOTAL LIABILITY
HEREUNDER EXCEED TWO TIMES ANY ROYALTIES PAID TO WINTEGRA UNDER SECTION 8
(WHERE
FOR
PURPOSES OF CALCULATING TI’S LIABILITY MAXIMUM TI SHALL BE CREDITED THOSE FEES
ALREADY PAID TO WINTEGRA.
EXCEPT
FOR TI’S CONFIDENTIALITY OBLIGATIONS UNDER SECTION 11 AND TI’S OBLIGATIONS
DESCRIBED IN SECTION 5, IN NO EVENT WILL TI BE LIABLE TO WINTEGRA FOR
ANY
INCIDENTAL, CONSEQUENTIAL OR INDIRECT DAMAGES, HOWEVER CAUSED, ON ANY THEORY
OF
LIABILITY AND WHETHER OR NOT TI HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES, ARISING IN ANY WAY OUT OF THIS AGREEMENT, THE LICENSED SOFTWARE, ESCROW
MATERIALS, WINTEGRA PRODUCTS, OR WINTEGRA CHIPS, OR TI’S USE OF THOSE MATERIALS.
EXCLUDED DAMAGES INCLUDE, BUT ARE NOT LIMITED TO, COST OF REMOVAL OR
REINSTALLATION, OUTSIDE COMPUTER TIME, PROCUREMENT OF SUBSTITUTE GOODS OR
SERVICES, LABOR COSTS, LOSS OF DATA, LOSS OF GOODWILL, LOSS OF PROFITS, LOSS
OF
SAVINGS, OR LOSS OF USE OR INTERRUPTION OF BUSINESS. IN NO EVENT SHALL TI BE
LIABLE FOR ANY SPECIAL, EXEMPLARY, OR PUNITIVE DAMAGES FOR ANY REASON.
|
14.2
|
WINTEGRA
|
Page
13
EXCEPT
FOR THE EXCEPTIONS DESCRIBED BELOW, WINTEGRA’S TOTAL LIABILITY HEREUNDER SHALL
NOT EXCEED TWO TIMES ANY ROYALTIES PAID TO WINTEGRA UNDER SECTION
8.
EXCEPT
FOR THE EXCEPTIONS DESCRIBED BELOW, WINTEGRA SHALL NOT BE LIABLE TO TI FOR
ANY
INCIDENTAL, CONSEQUENTIAL OR INDIRECT DAMAGES, HOWEVER CAUSED, ON ANY THEORY
OF
LIABILITY AND WHETHER OR NOT WINTEGRA HAS BEEN ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES, ARISING IN ANY WAY OUT OF THIS AGREEMENT, THE LICENSED SOFTWARE,
ESCROW MATERIALS, WINTEGRA PRODUCTS, OR WINTEGRA CHIPS, OR TI’S USE OF THOSE
MATERIALS. EXCLUDED DAMAGES INCLUDE, BUT ARE NOT LIMITED TO, COST OF REMOVAL
OR
REINSTALLATION, OUTSIDE COMPUTER TIME, PROCUREMENT OF SUBSTITUTE GOODS OR
SERVICES, LABOR COSTS, LOSS OF DATA, LOSS OF GOODWILL, LOSS OF PROFITS, LOSS
OF
SAVINGS, OR LOSS OF USE OR INTERRUPTION OF BUSINESS. IN NO EVENT SHALL WINTEGRA
BE LIABLE FOR ANY SPECIAL, EXEMPLARY, OR PUNITIVE DAMAGES FOR ANY REASON.
THE
FOREGOING LIMITATIONS OF LIABILITY ON WINTEGRA SHALL NOT APPLY (i) TO WINTEGRA’S
CONFIDENTIALITY OBLIGATIONS UNDER SECTION 11, (ii) TO TI’S EXPENSES AND DAMAGES
INCURRED IN ATTEMPTING TO GAIN ACCESS TO THE ESCROWED MATERIALS, (a) IF WINTEGRA
OR AN ACQUIRING COMPANY DENIES TI ACCESS TO THE ESCROW MATERIALS, DESPITE THE
OCCURRENCE OF A RELEASE CONDITION, OR (b) IF WINTEGRA OR AN ACQUIRING COMPANY
FAILS TO FULFILL ITS OBLIGATIONS UNDER SECTION 7 (REQUIREMENTS UPON OCCURRENCE
OF RELEASE CONDITION).
EACH
PARTY AGREES THAT THE FOREGOING LIMITATIONS ON LIABILITY ARE ESSENTIAL ELEMENTS
OF THE PARTIES’ BASIS OF THE BARGAIN AND THAT WITHOUT SUCH LIMITATIONS, THE
MATERIAL AND ECONOMIC TERMS OF THIS AGREEMENT WOULD BE SUBSTANTIALLY
DIFFERENT.
|
15.
|
Notices.
|
Page
14
Any
notice required or authorized in this Agreement shall be given in writing by
recognized overnight express service or personal delivery addressed to the
other
Party as specified below, or such other address as may be requested in writing
by the Party to be notified:
|
Wintegra:
|
Texas
Instruments:
|
|
Wintegra,
Inc.
|
Texas
Instruments Incorporated
|
|
7200
N. MoPac Expressway
|
00000
XX Xxxxxxxxx, X/X 0000
|
|
Xxxxx
000
|
Xxxxxx,
Xxxxx 00000
|
|
Xxxxxx,
Xxxxx 00000
|
Attention:
Vice President,
|
|
Attention:
Xxxx Xxxxxxxx
|
Broadband
Communications Group
|
|
Copy
to:
|
|
|
Law
Department – General Counsel
|
|
|
0000
Xxxxxxxxx Xxx, X/X 0000
|
|
|
Xxxxxx,
Xxxxx 00000
|
|
|
FAX:
000-000-0000
|
|
16.
|
Term,
Termination, and Survival
|
|
16.1.
|
Term
and Termination
|
The
term
of this Agreement shall commence on the Effective Date and shall continue for
unless
terminated or cancelled as provided for herein.
Five
(5) years after the Effective Date (such first five years shall be the “Initial
Term”), either Party may terminate this Agreement with six (6) months' advance
written notice to the other party.
The
Parties agree that Wintegra shall be prohibited from terminating this Agreement
(even for TI’s material breach or even if the Initial Term has expired) with
respect to a Significant Customer until TI’s obligations to such Significant
Customer regarding the Wintegra Chips and Licensed Software, or reasonable
substitutes thereof, have been met or have expired. Wintegra’s inability to
terminate shall not preclude Wintegra from seeking recovery for proper damages
under this Agreement.
Any
termination of this Agreement shall not affect the rights of TI’s sublicensees
and rights of TI customers that are in existence at the time of termination
shall survive such termination.
Notwithstanding
the foregoing, TI is also entitled to immediately terminate this Agreement
upon
Wintegra’s assignment or transfer of this Agreement without TI’s written consent
except as provided herein, and Wintegra is also entitled to immediately
terminate this Agreement upon TI’s assignment or transfer of this Agreement
without Wintegra’s written consent except as provided herein.
Page
15
16.3
Survival
The
following Sections will survive any expiration or earlier termination of this
Agreement : 1 (Definitions), 3 (Agreement from Wintegra’s Fabrication Sources)
(if a Release Condition has occurred before the expiration or termination of
this Agreement), 5 (Licenses)(if a Release Condition has occurred before the
expiration or termination of this Agreement), 7 (Requirements upon Occurrence
of
Release Condition), 8 (Royalties and Joint Ownership Buy-out), 10 (Title),
11
(Confidentiality), 12 (Warranties), 13 (Indemnity), 14 (Limitation of
Liability), 15 (Notices) 16 (Term, Termination and Survival), and 17 (General
Provisions).
In
the
event of expiration or termination prior to occurrence of a Release Condition
and as soon as Appendix 5 contains no Significant Customers, the Escrow
Materials will be released to Wintegra.
|
17.
|
General
Provisions
|
|
17.1
|
Choice
of Law
|
This
Agreement will be governed by and interpreted in accordance with the laws of
the
State of Texas, without reference to its conflict of laws principles. This
Agreement shall not be governed by the United Nations Convention on Contracts
for the International Sale of Goods, or by the Uniform Computer Information
Transactions Act (UCITA). The Parties agree that non-exclusive jurisdiction
for
any dispute arising out of or relating to this Agreement lies within courts
located in the State of Texas. Notwithstanding the foregoing, any judgment
may
be enforced in any United States or foreign court, and either Party may seek
injunctive relief in any United States or foreign court.
|
17.2
|
Waiver
|
No
delay,
omission, or failure to exercise any right or remedy provided herein shall
be
deemed to be a waiver thereof or an acquiescence in the event giving rise to
such right or remedy, but every such right or remedy may be exercised, from
time
to time; as may be deemed expedient by the Party exercising such remedy or
right.
|
17.3
|
Taxes
|
Each
Party shall be solely responsible for any sales, use, service or other tax
levied or incurred on account of the Agreement or the activities hereunder,
except for tax based upon the net income of the other Party. If royalties are
payable by TI, Wintegra shall notify TI of the identity of the payee entity.
|
17.4
|
Invalidity
|
If
any
provision herein is too broad in any respect to permit the full enforcement
thereof, then such provision shall be limited only so far as it is necessary
to
allow conformance to the law, and as so limited shall be deemed a part hereof
herein. If any invalid provision may not be so limited, such provision shall
be
deleted from the Agreement, but the remaining provisions shall remain in full
force and effect.
Page
16
|
17.5
|
Assignment
|
Neither
this Agreement or any of TI’s rights and obligations granted herein may be
assigned or transferred by TI, whether voluntarily or by operation of law,
without the prior written permission of Wintegra. Neither this Agreement or
any
of Wintegra’s rights and obligations granted herein may be assigned or
transferred by Wintegra, whether voluntarily or by operation of law, without
the
prior written permission of TI.
|
17.6
|
Export
|
It
is
expressly agreed by the Parties that the delivery and distribution of the Escow
Materials in accordance with this Agreement shall be subject to all applicable
export controls imposed or administered by any agency of the U.S. Government
which may impose such controls, including but not limited to the export of
technical data, equipment, software and know-how. Both Parties agree not to
directly or indirectly export any Escrowed Materials, including, but not limited
to software or technical data/documentation without first obtaining the required
U.S. Government export license(s). If a Party intends to export software to
another country other than the U.S., such Party shall determine whether an
export license is required and, if so, obtain that license from the U.S.
Government.
Each
Party shall indemnify the other Party from any loss or liability due to the
violating Party’s failure to comply with export regulations. Wintegra shall
notify TI of any export restrictions of which it is aware, and shall use good
faith, commercially reasonable efforts to classify and monitor the export
control duties for the Licensed Software.
|
17.7
|
Integration
|
This
Agreement and the parties' Co-Marketing and Software License Agreement are
the
complete and exclusive agreement between the Parties with regard to the subject
matter hereof and supersedes the prior discussions, negotiations and memoranda
related hereto. Any purchase order or acknowledgment or invoice issued for
the
software, documentation, or services provided hereunder shall be for the sole
purposes of administrative convenience. The Parties agree that this Agreement
and the Co-Marketing and Software License Agreement shall be interpreted in
a
consistent manner, and in the event of a conflict, this Agreement shall govern.
|
17.8
|
Appendices
|
Attached
hereto and incorporated herein by this reference are the following
appendices:
Appendix
1: Description of Licensed Software and Wintegra Chips
Page
17
Appendix
2: Agreement with Fabrication Sources
Appendix
3: Escrow Agreement
Appendix
4: Release Conditions
Appendix
5: Significant Customers
|
17.9
|
Counterparts
|
This
Agreement may be executed in multiple original counterparts, each of which
will
be an original, but all of which taken together shall constitute one and the
same document.
Page
18
|
Wintegra
Incorporated
|
Texas
Instruments Incorporated
|
|||
|
Name:
|
/s/
Xxxx Xxx-Xxx
|
Name:
|
/s/
Xxxx X. Xxxxxxxx
|
|
|
(Signature)
|
(Signature)
|
|||
|
Name:
|
Xxxx
Xxx-Xxx
|
Name:
|
Xxxx
X. Xxxxxxxx
|
|
|
(Print)
|
(Print)
|
|||
|
Title:
|
CEO
|
Title:
|
VP
& Assistant General Counsel
|
|
|
Date:
|
4/17/03
|
Date:
|
4/15/03
|
|
Appendix
1
Description
of Licensed Software
A. Licensed
Software (all Licensed Software will be provided to TI in Source Code):
[†]
_____________________
[†]
Information redacted pursuant to a confidential treatment request by Wintegra,
Inc. under 17 CFR §§ 200.80(b)(4) and 230.406 and submitted separately with the
Securities and Exchange Commission.
Atlanta
• Boston • Chicago • Dallas • San Diego • San Francisco •
Toronto
For
More Information Call: (000) 000-0000 or Visit Us At xxx.xxxxxxxxx.xxx
or
xxx.xxxxxxxxxxxx.xxx
Appendix
2
Agreement
with Fabrication Sources
This
Agreement is made and entered into as of _______the (“Effective Date”) by and
between Wintegra, Inc., a _________corporation with its principal place of
business at 0000 Xxxxx XxXxx Xxxxxxxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000, and
_________, a ________corporation with its principal place of business at
__________(“Fabrication Source”).
Whereas,
Fabrication Source and Wintegra have an existing agreement for Fabrication
Source to manufacture _________, [INSERT
LANGUAGE THAT WOULD IDENTIFY THE PRODUCT FOR THE FAB];
Whereas,
Fabrication Source acknowledges that circumstances may occur that require
Texas
Instruments Incorporated (“TI”) with its
principal place of business at 00000 XX Xxxxxxxxx,
Xxxxxx, Xxxxx, 00000,
to
assume management of Fabrication Source’s manufacture
of _____for TI customers.
Wintegra
or its successor and/or TI shall provide Fabrication Source with a notice from
from
such
parties’ escrow agent that indicated that Escrow Materials have been
released. Upon receiving such notification, Fabrication Source will enter into
an agreement
with TI for the manufacture of _______, and such agreement will contain
terms
as
least as favorable as those terms provided to Wintegra.
|
Wintegra,
Inc.
|
Fabrication
Source
|
|
Name:
________________________________
|
Name:
________________________________
|
|
(Signature)
|
(Signature)
|
|
Name:
________________________________
|
Name:
________________________________
|
|
(Print)
|
(Print)
|
|
Title:
_________________________________
|
Title:
_________________________________
|
|
Date:
_________________________________
|
Date:
_________________________________
|
|
Texas
Instruments Incorporated
|
|
|
Name:
_________________________________
|
|
|
(Signature)
|
|
|
Name:
_________________________________
|
|
|
(Print)
|
|
|
Title:________________________________
|
|
|
Date:________________________________
|
|
Atlanta
• Boston • Chicago • Dallas • San Diego • San Francisco •
Toronto
For
More Information Call: (000) 000-0000 or Visit Us At xxx.xxxxxxxxx.xxx or
xxx.xxxxxxxxxxxx.xxx
Appendix
3
 |
DSI
TECHNOLOGY ESCROW SERVICES®
An Iron Mountain Company |
|
|
Master
Preferred Agreement
Master
Preferred offers the flexibility of a modifiable contract combined with a high
level of protection for both the depositor and the beneficiary. It allows for
additional parties to accept contract conditions with a one-page addendum.
It
provides frequent correspondence between DSI and all parties to the agreement.
The depositor and beneficiary will receive signed confirmations from DSI that
every deposit has been inspected; an account history report to notify them
of
the status of the escrow; and ongoing monitoring services to ensure compliance
of contract terms.
Purpose
DSI's
Master Preferred Agreement is generally used when:
|
·
|
Both
parties agree that a high level of escrow protection is
needed.
|
|
·
|
The
depositor or the beneficiary wants to establish an escrow contract
that is
executed once, defining the company's preferred
terms.
|
|
·
|
The
depositor has multiple products to be licensed independently by various
beneficiaries.
|
|
·
|
Both
parties want to reduce the time spent on negotiating the basic terms
and
conditions of the escrow agreement.
|
|
·
|
Clients
want to avoid setup costs when adding beneficiaries or depositors
to their
escrow account.
|
Features
Master
Preferred customers benefit from these unique features:
|
·
|
One
agreement ensures consistency for all escrow
requirements.
|
|
·
|
Additional
parties accept contract conditions with a one-page
form.
|
|
·
|
Tailored
release conditions.
|
|
·
|
Modification
of terms for unique requirements.
|
|
·
|
Written
notification detailing the contents of the initial deposit and each
update.
|
|
·
|
Semiannual
account histories listing all deposit
activity.
|
|
·
|
DSI
direct billing to beneficiary.
|
|
·
|
Technical
verification options.
|
|
·
|
Audit
trail of deposit created through inspection, date stamping of all
deposit
materials.
|
|
·
|
Deposit
inspection with signed receipt for all
parties.
|
Atlanta
• Boston • Chicago • Dallas • San Diego • San Francisco •
Toronto
For
More Information Call: (000) 000-0000 or Visit Us At xxx.xxxxxxxxx.xxx or
xxx.xxxxxxxxxxxx.xxx
MASTER
PREFERRED ESCROW AGREEMENT
Master
Number 9918
This
agreement "Agreement" is effective _____________, 20____ among DSI Technology
Escrow Services, Inc. ("DSI"), WINTEGRA LTD. (acting on behalf of its affiliates
and parent company Wintegra Inc. and referred to herein as ("Depositor") and
any
additional party signing the Acceptance Form attached to this Agreement
("Preferred Beneficiary"), who collectively may be referred to in this Agreement
as the parties ("Parties").
A. Depositor
and Preferred Beneficiary have entered or will enter into a license agreement,
development agreement, escrow agreement and/or other agreement regarding certain
proprietary technology of Depositor (referred to in this Agreement as "the
License Agreement").
B. Depositor
desires to avoid disclosure of its proprietary technology except under certain
limited circumstances.
C. The
availability of the proprietary technology of Depositor is critical to Preferred
Beneficiary in the conduct of its business and, therefore, Preferred Beneficiary
needs access to the proprietary technology under certain limited
circumstances.
D. Depositor
and Preferred Beneficiary desire to establish an escrow with DSI to provide
for
the retention, administration and controlled access of certain proprietary
technology materials of Depositor.
E. The
parties desire this Agreement to be supplementary to the License Agreement
pursuant to 00 Xxxxxx Xxxxxx [Bankruptcy] Code, Section 365(n).
ARTICLE
1
-- DEPOSITS
1.1 Obligation
to Make Deposit.
Upon
the signing of this Agreement by the parties, including the signing of the
Acceptance Form, and Exhibit D naming the Deposit Account, Depositor shall
deliver to DSI the proprietary technology and other materials ("Deposit
Materials") required to be deposited by the License Agreement or, if the License
Agreement does not identify the materials to be deposited with DSI, then such
materials will be identified on Exhibit A. If Exhibit A is applicable, it is
to
be prepared and signed by Depositor and Preferred Beneficiary. DSI shall have
no
obligation with respect to the preparation, signing or delivery of Exhibit
A.
1.2 Identification
of Tangible Media.
Prior
to the delivery of the Deposit Materials to DSI, Depositor shall conspicuously
label for identification each document, magnetic tape, disk, or other tangible
media upon which the Deposit Materials are written or stored. Additionally,
Depositor shall complete Exhibit B to this Agreement by listing each such
tangible media by the item label description, the type of media and the
quantity. Exhibit B shall be signed by Depositor and delivered to DSI with
the
Deposit Materials. Unless and until Depositor makes the initial deposit with
DSI, DSI shall have no obligation with respect to this Agreement, except the
obligation to notify the parties regarding the status of the account as required
in Section 2.2 below.
1.3 Escrow
Account Name Identification.
Subject
to this Section 1, and at the time Depositor makes the initial deposit with
DSI
in accordance with Section 1.2 above, Depositor shall complete and sign Exhibit
D naming the initial account upon which the Deposit Materials are written or
stored. Any new deposits referencing new account names made subsequent to the
signing of this Agreement, intended by the Depositor to be held in a separate
account and maintained separately from the initial account, but made a part
of
this Agreement, shall be provided for by the Depositor on Exhibit E, and Exhibit
E shall be signed by the Depositor and DSI.
1.4 Acceptance
of Deposit.
When
DSI receives the Deposit Materials, DSI will conduct a deposit inspection.
At
completion of the deposit inspection, if DSI determines that the labeling of
the
tangible media matches the item descriptions and quantity on Exhibit B, DSI
will
date and sign Exhibit B and mail a copy thereof to Depositor and Preferred
Beneficiary. If DSI determines that the labeling does not match the item
descriptions or quantity on Exhibit B, DSI will (a) note the discrepancies
in
writing on Exhibit B; (b) date and sign Exhibit B with the exceptions noted;
and
(c) mail a copy of Exhibit B to Depositor and Preferred Beneficiary. DSI's
acceptance of the deposit occurs upon the signing of Exhibit B by DSI. Delivery
of the signed Exhibit B to Preferred Beneficiary is Preferred Beneficiary's
notice that the Deposit Materials have been received and accepted by DSI. Other
than DSI's inspection of the Deposit Materials, DSI shall have no obligation
to
the accuracy, completeness, functionality, performance or non-performance of
the
Deposit Materials.
1.5 Depositor's
Representations.
Depositor represents as follows:
|
a.
|
Depositor
lawfully possesses all of the Deposit Materials deposited with
DSI;
|
|
b.
|
With
respect to all of the Deposit Materials, Depositor has the right
and
authority to grant to DSI and Preferred Beneficiary the rights
as provided
in this Agreement;
|
|
c.
|
Any
liens or encumbrances on the Deposit Materials will not prohibit,
limit,
or alter the rights and obligations of DSI under this
Agreement;
|
|
d.
|
The
Deposit Materials consist of the proprietary technology and other
materials identified either in the License Agreement or Exhibit
A, as the
case may be; and
|
|
e.
|
The
Deposit Materials are readable and useable in their current form
or, if
any portion of the Deposit Materials is encrypted, the decryption
tools
and decryption keys have also been
deposited.
|
1.6 Verification.
Upon
receipt of a written request from Preferred Beneficiary, DSI and Preferred
Beneficiary may enter into a separate proposal agreement pursuant to which
DSI
will agree, upon certain terms and conditions, to inspect the Deposit Materials
for the purpose of verifying its accuracy, completeness, sufficiency and quality
("Verification Proposal Agreement"). Depositor shall reasonably cooperate with
DSI by providing its facilities, computer software systems, and technical and
support personnel for verification whenever reasonably necessary. If a
verification is elected after the Deposit Materials have been delivered to
DSI,
then only DSI, or at DSI’s election, an independent contractor or company
selected by DSI which has executed a non-disclosure and confidentiality
agreement that is approved by Depositor, may perform the
verification.
1.7 Deposit
Updates.
Unless
otherwise provided by the License Agreement, Depositor shall update the Deposit
Materials within sixty (60) days of each release of a new version of the
product, which is subject to the License Agreement. Such updates will be added
to the existing deposit. All deposit updates shall be listed on a new Exhibit
B
and the new Exhibit B shall be signed by Depositor. Each Exhibit B will be
held
and maintained separately within the escrow account. An independent record
will
be created which will document the activity for each Exhibit B. The processing
of all deposit updates shall be in accordance with Sections 1.2 through 1.6
above. All references in this Agreement to the Deposit Materials shall include
the initial Deposit Materials and any updates.
1.8 Storage
and Removal of Deposit Materials.
DSI
shall act as custodian of the Deposit Materials until the escrow is terminated
pursuant to Article 5 of this Agreement, and shall not permit any person access
to the Deposit Materials except as necessary to perform under this Agreement.
DSI shall establish, under its control, a secure receptacle for the purpose
of
storing the Deposit Materials. The Deposit Materials shall remain the exclusive
property of the Depositor, subject only to the licenses provided in this
Agreement. The Deposit Materials may be removed and/or exchanged only on written
instructions signed by Depositor and Preferred Beneficiary, or as otherwise
provided in this Agreement. Access to the Deposit Materials shall not be granted
without compliance with all established security and identification procedures
instituted by DSI.
ARTICLE
2
-- CONFIDENTIALITY
AND RECORD KEEPING
2.1 Confidentiality.
DSI
shall have the obligation to reasonably protect the confidentiality of the
Deposit Materials. DSI shall not divulge, disclose or otherwise make available
the Deposit Materials to any parties other than those persons duly authorized
in
writing by the competent officer of Depositor, except as provided in this
Agreement. Except as provided in this Agreement or any subsequent agreement
between the Parties, DSI shall not disclose, transfer, make available, or use
the Deposit Materials. DSI shall not disclose the terms of this Agreement to
any
third party. If DSI receives a subpoena or any other order from a court or
other
judicial tribunal pertaining to the disclosure or release of the Deposit
Materials, DSI will immediately notify the parties to this Agreement unless
prohibited by law. It shall be the responsibility of Depositor and/or Preferred
Beneficiary to challenge any such order; provided, however, that DSI does not
waive its rights to present its position with respect to any such order. DSI
will not be required to disobey any order from a court or other judicial
tribunal including, but not limited to, notices delivered pursuant to 7.6
below.
2.2 Status
Reports.
DSI
will issue to Depositor and Preferred Beneficiary a report profiling the account
history semi-annually.
ARTICLE
3
-- RIGHT
TO MAKE COPIES
3.1 Right
to Make Copies.
DSI
shall have the right to make copies of the Deposit Materials as reasonably
necessary to perform this Agreement. DSI shall copy all copyright,
nondisclosure, and other proprietary notices and titles contained on the Deposit
Materials onto any copies made by DSI. With all Deposit Materials submitted
to
DSI, Depositor shall provide any and all instructions as may be necessary to
duplicate the Deposit Materials including but not limited to the hardware and/or
software needed. Any copying expenses incurred by DSI as a result of a request
to copy will be borne by the party requesting the copies. Alternatively, DSI
may
notify Depositor requiring its reasonable cooperation in promptly copying the
Deposit Materials in order for DSI to perform this Agreement.
ARTICLE
4
-- RELEASE
OF DEPOSIT
4.1 Release
Conditions.
As used
in this Agreement, "Release Condition" shall mean the following:
|
a.
|
a
receiver is appointed for either Depositor or its
property;
|
|
b.
|
Depositor
makes a general assignment for the benefit of its
creditors;
|
|
c.
|
Depositor
commences, or has commenced against it, proceedings under any bankruptcy,
insolvency or debtor's relief law, which proceedings are not dismissed
within sixty (60) days; or
|
Depositor
is liquidated, dissolved or ceases to do business without a suitable
successor.
4.2 Filing
For Release.
If
Preferred Beneficiary believes in good faith that a Release Condition has
occurred, Preferred Beneficiary may provide to DSI written notice of the
occurrence of the Release Condition and a request for the release of the Deposit
Materials. Within five (5) business days of receipt of a written notice, DSI
shall provide a copy of the notice to Depositor. DSI will promptly notify the
Parties unless DSI acknowledges or discovers independently, or through the
Parties, its need for additional documentation or information in order to comply
with this section. Such need for additional documentation or information may
extend the time period for DSI's performance under this section.
4.3 Contrary
Instructions.
From
the date DSI mails the notice requesting release of the Deposit Materials,
Depositor shall have twenty (20) business days to deliver to DSI contrary
instructions ("Contrary Instructions"). Contrary Instructions shall mean the
written representation by Depositor that a Release Condition has not occurred
or
has been cured. Upon receipt of Contrary Instructions, DSI shall send a copy
to
Preferred Beneficiary by commercial express mail. Additionally, DSI shall notify
both Depositor and Preferred Beneficiary that there is a dispute to be resolved
pursuant to the Section 7.4. Subject to Section 5.2 of this Agreement, DSI
will
continue to store the Deposit Materials without release pending (a) joint
instructions from Depositor and Preferred Beneficiary; (b) dispute resolution
pursuant to Section 7.4; or (c) order from a court of competent
jurisdiction.
4.4 Release
of Deposit.
If DSI
does not receive Contrary Instructions from the Depositor, DSI is authorized
to
release the Deposit Materials to the Preferred Beneficiary or, if more than
one
beneficiary is registered to the deposit, to release a copy of the Deposit
Materials to the Preferred Beneficiary. However, DSI is entitled to receive
any
fees due DSI before making the release. Any copying expenses will be chargeable
to Preferred Beneficiary. Upon any such release, the escrow arrangement will
terminate as it relates to the Depositor and Preferred Beneficiary involved
in
the release.
4.5 Right
to Use Following Release.
Unless
otherwise provided in the License Agreement, upon release of the Deposit
Materials in accordance with this Article 4, Preferred Beneficiary shall have
the right to use the Deposit Materials for the sole purpose of continuing the
benefits afforded to Preferred Beneficiary by the License Agreement. Preferred
Beneficiary shall be obligated to maintain the confidentiality of the released
Deposit Materials.
4.6 Notices.
All
notices in this Article 4 shall be delivered to Depositor by overnight courier,
at the expense of Depositor.
ARTICLE
5
-- TERM
AND TERMINATION
5.1 Term
of Agreement.
The
initial term of this Agreement is for a period of one (1) year. Thereafter,
this
Agreement shall automatically renew from year-to-year unless (a) Depositor
and
Preferred Beneficiary jointly instruct DSI in writing that the Agreement is
terminated; (b) DSI instructs Depositor and Preferred Beneficiary in writing
ninety (90) days after its renewal date that the Agreement is terminated for
nonpayment in accordance with Section 5.2; (c) Depositor or Preferred
Beneficiary notifies DSI in writing that it is terminated in accordance with
the
terms of the License Agreement; or (d) DSI reserves the right to terminate
this
Agreement, for any reason, other than nonpayment, by providing Depositor and
Preferred Beneficiary sixty (60) days written notice of its intent to terminate
this Agreement. If the Deposit Materials are subject to another escrow agreement
with DSI, DSI reserves the right, after the initial one year term, to adjust
the
anniversary date of the Agreement to match the then prevailing anniversary
date
of such other escrow arrangements.
5.2 Termination
for Nonpayment.
In the
event of the nonpayment of fees owed to DSI, DSI shall provide written notice
of
delinquency to the parties to this Agreement affected by such delinquency.
Any
such party shall have the right to make the payment to DSI to cure the default.
If the past due payment is not received in full by DSI within one (1) month
of
the date of such notice, then at any time thereafter DSI shall have the right
to
terminate this Agreement to the extent it relates to the delinquent party by
sending written notice of termination to such affected parties. DSI shall have
no obligation to take any action under this Agreement so long as any payment
due
to DSI remains unpaid.
5.3 Disposition
of Deposit Materials Upon Termination.
Subject
to the foregoing termination provisions, and upon termination of this Agreement,
DSI shall destroy, return, or otherwise deliver the Deposit Materials in
accordance with Depositor's instructions. If there are no instructions, DSI
may,
at its sole discretion, destroy the Deposit Materials or return them to
Depositor. DSI shall have no obligation to destroy or return the Deposit
Materials if the Deposit Materials are subject to another escrow agreement
with
DSI or have been released to the Preferred Beneficiary in accordance with
Section 4.4.
5.4 Survival
of Terms Following Termination.
Upon
termination of this Agreement, the following provisions of this Agreement shall
survive:
|
a.
|
Depositor's
Representations (Section 1.5);
|
|
b.
|
The
obligations of confidentiality with respect to the Deposit
Materials;
|
|
c.
|
The
obligation to pay DSI any fees and expenses
due;
|
|
d.
|
The
provisions of Article 7; and
|
|
e.
|
Any
provisions in this Agreement which specifically state they survive
the
termination of this Agreement.
|
ARTICLE
6
-- DSI'S
FEES
6.1 Fee
Schedule.
DSI is
entitled to be paid its standard fees and expenses applicable to the services
provided. DSI shall notify the party responsible for payment of DSI's fees
at
least sixty (60) days prior to any increase in fees. For any service not listed
on DSI's standard fee schedule, DSI will provide a quote prior to rendering
the
service, if requested.
6.2 Payment
Terms.
DSI
shall not be required to perform any service, including release of any Deposit
Materials under Article 4, unless the payment for such service and any
outstanding balances owed to DSI are paid in full. Fees are due upon receipt
of
a signed contract or receipt of the Deposit Materials whichever is earliest.
If
invoiced fees are not paid, DSI may terminate this Agreement in accordance
with
Section 5.2.
ARTICLE
7 --
LIABILITY AND DISPUTES
7.1 Right
to Rely on Instructions.
DSI may
act in reliance upon any instruction, instrument, or signature reasonably
believed by DSI to be genuine. DSI may assume that any employee of a party
to
this Agreement who gives any written notice, request, or instruction has the
authority to do so. DSI will not be required to inquire into the truth or
evaluate the merit of any statement or representation contained in any notice
or
document. DSI shall not be responsible for failure to act as a result of causes
beyond the reasonable control of DSI.
7.2 Indemnification.
Depositor and Preferred Beneficiary each agree to indemnify, defend and hold
harmless DSI from any and all claims, actions, damages, arbitration fees and
expenses, costs, attorney's fees and other liabilities ("Liabilities") incurred
by DSI relating in any way to this escrow arrangement except where it is
adjudged that DSI acted with gross negligence or willful misconduct.
7.3 Limitation
of Liability.
In no
event will DSI be liable for any incidental, indirect, special, exemplary,
punitive or consequential damages, including, but not limited to, damages
(including loss of data, revenue, and/or profits) costs or expenses (including
legal fees and expenses), whether foreseeable or unforeseeable, that may arise
out of or in connection with this Agreement; and in no event shall the
collective liability of DSI exceed ten times the fees paid under this Agreement.
The foregoing limitation of liability does not apply with respect to any acts
of
gross negligence, personal injury claims, property damage claims (excluding
the
Deposit), or intellectual property infringement ("Exclusions"). With the
exception of the Exclusions, DSI shall in no event be liable for any incidental,
punitive, special, indirect or consequential damages.
7.4 Dispute
Resolution.
Unless
otherwise agreed by Depositor and Preferred Beneficiary, any dispute relating
to
or arising from this Agreement shall be submitted to, and settled by arbitration
by a single arbitrator chosen by the San Diego Regional Office of the American
Arbitration Association in accordance with the Commercial Rules of the American
Arbitration Association. Unless otherwise agreed by Depositor and Preferred
Beneficiary, the arbitrator shall apply New York law. Unless otherwise agreed
by
Depositor and Preferred Beneficiary, arbitration will take place in San Diego,
California, U.S.A. Any court having jurisdiction over the matter may enter
judgment on the award of the arbitrator. Service of a petition to confirm the
arbitration award may be made by First Class mail or by commercial express
mail,
to the attorney for the party or, if unrepresented, to the party at the last
known business address. If, however, Depositor and/or Preferred Beneficiary
refuses to submit to arbitration, the matter shall not be submitted to
arbitration and DSI may submit the matter to any court of competent
jurisdiction. Any costs of arbitration incurred by DSI, including reasonable
attorney's fees and costs, shall be divided equally and paid by Depositor and
Preferred Beneficiary.
7.5 Controlling
Law.
This
Agreement is to be governed and construed in accordance with the laws of the
State of New York, without regard to its conflict of law
provisions.
7.6 Notice
of Requested Order.
If any
party intends to obtain an order from the arbitrator or any court of competent
jurisdiction, which may direct DSI to take, or refrain from taking any action,
that party shall:
|
a.
|
Give
DSI at least five (5) business days prior notice of the
hearing;
|
|
b.
|
Include
in any such order that, as a precondition to DSI's obligation, DSI
be paid
in full for any past due fees and be paid for the reasonable value
of the
services to be rendered pursuant to such order;
and
|
|
c.
|
Ensure
that DSI not be required to deliver the original (as opposed to a
copy) of
the Deposit Materials if DSI may need to retain the original in its
possession to fulfill any of its other escrow
duties.
|
ARTICLE
8
-- GENERAL
PROVISIONS
8.1 Entire
Agreement.
This
Agreement, which includes the Acceptance Form and Exhibits A, B, C, D and E
described herein, embodies the entire understanding among all of the parties
with respect to its subject matter and supersedes all previous communications,
representations or understandings, either oral or written. DSI is not a party
to
the License Agreement between Depositor and Preferred Beneficiary and has no
knowledge of any of the terms or provisions of any such License Agreement.
DSI's
only obligations to Depositor or Preferred Beneficiary are as set forth in
this
Agreement and its Exhibits. No amendment or modification of this Agreement
shall
be valid or binding unless signed by all the parties hereto, except that Exhibit
A need not be signed by DSI, Exhibit B need not be signed by Preferred
Beneficiary, Exhibit C need not be signed by any party, Exhibit D need not
be
signed by Preferred Beneficiary or DSI and the Acceptance Form need only be
signed by the parties identified therein.
8.2 Notices.
All
notices, invoices, payments, deposits and other documents and communications
shall be given to the parties at the addresses and fax numbers specified in
the
attached Exhibit C and Acceptance Form. It shall be the responsibility of the
parties to notify each other as provided in this Section in the event of a
change of address. The parties shall have the right to rely on the last known
address of the other parties. Any correctly addressed notice or last known
address of the other parties that is relied on herein that is refused,
unclaimed, or undeliverable because of an act or omission of the party to be
notified as provided herein shall be deemed effective as of the first date
that
said notice was refused, unclaimed, or deemed undeliverable by the postal
authorities by mail, through messenger or commercial express delivery services.
Unless otherwise provided in this Agreement, all documents and communications
may be delivered by First Class mail, and a copy sent by fax.
8.3 Severability.
In the
event any provision of this Agreement is found to be invalid, voidable or
unenforceable, the parties agree that unless it materially affects the entire
intent and purpose of this Agreement, such invalidity, voidability or
unenforceability shall affect neither the validity of this Agreement nor the
remaining provisions herein, and the provision in question shall be deemed
to be
replaced with a valid and enforceable provision most closely reflecting the
intent and purpose of the original provision.
8.4 Successors
and Assigns.
This
Agreement shall be binding upon and shall inure to the benefit of the successors
and assigns of the parties. However, DSI shall have no obligation in performing
this Agreement to recognize any successor or assign of Depositor or Preferred
Beneficiary unless DSI receives clear, authoritative and conclusive written
evidence of the change of parties.
8.5 Waiver.
Any
term of this Agreement may be waived by the party entitled to the benefits
thereof, provided that any such waiver must be in writing and signed by the
party against whom the enforcement of the waiver is sought. No waiver of any
condition, or breach of any provision of this Agreement, in any one or more
instances, shall be deemed to be a further or continuing waiver of such
condition or breach. Delay or failure to exercise any right or remedy shall
not
be deemed the waiver of that right or remedy.
8.6 Regulations.
Depositor and Preferred Beneficiary are responsible for and warrant compliance
with all applicable laws, rules and regulations, including but not limited
to
customs laws, import, export, and re-export laws and government regulations
of
any country from or to which the Deposit Materials may be delivered in
accordance with the provisions of this Agreement.
8.7 Attorney's
Fees.
In any
litigation or other proceeding by which one party either seeks to enforce its
rights under this Agreement (whether in contract, tort, or both) or seeks
declaration of any rights or obligations under this Agreement, the prevailing
party who has proven in court by court decree, judgment or arbitrator's decision
that the other party has materially breached its representation and/or warranty
under this Agreement shall be awarded reasonable attorneys' fees, together
with
any costs and expenses, to resolve the dispute and to enforce final
judgement.
8.8 No
Third Party Rights.
This
Agreement is made solely for the benefit of the Parties to this Agreement and
their respective permitted successors and assigns, and no other person or entity
shall have or acquire any right by virtue of this Agreement unless otherwise
agreed to by all the parties hereto.
8.9 Authority
to Sign.
Each of
the Parties herein represents and warrants that the execution, delivery, and
performance of this Agreement has been duly authorized and signed by a person
who meets statutory or other binding approval to sign on behalf of its business
organization as named in this Agreement.
8.10 Counterparts.
This
Agreement may be executed in any number of counterparts, each of which shall
be
an original, but all of which together shall constitute one
instrument.
|
Wintegra
Ltd. _________
|
DSI
Technology Escrow Services, Inc.
|
|
Depositor
|
|
|
By: /s/
|
By: /s/
|
|
Name:
Xxxx Xxx-Xxx
|
Name: XXXXX
X. XXXXX
|
|
Title:
CEO
|
Title:
REGIONAL
SALES MANAGER
|
|
Date:
24.06.03
|
Date:
7/10/03
|
Appendix
4
Release
Conditions
Each
of
the following occurrences shall constitute a “Release Condition”:
A.
Wintegra’s
Insolvency.
Either
Wintegra, Inc. or Wintegra Ltd. (i) make an assignment for the benefit of
creditors; (ii) commences, or has commenced against it proceedings under any
bankruptcy, insolvency, or debtor’s relief law; (iii) has a receiver, trustee,
or liquidator appointed; (iv) institutes any proceedings for liquidation,
dissolution, or winding up; or (v) becomes unable to pay its debts as they
mature, and, if (i), (ii), or (iii) occur, such condition remains for sixty
(60)
days.
B.
Change
of Control of Wintegra:
1. The
Acquiring Party of Wintegra Inc. or Wintegra Ltd. is one of the entities below,
or an Affiliate (as defined below) of or successor to, one of the following
entites:
[†]
Any
other
entity in the same category that TI, in good faith at its reasonable discretion,
adds by amendment to this Agreement.
A
determination of TI’s good faith in this context shall consider whether such
company is a competitor of TI in the high density solution arena.
For
the purposes of this Appendix, an Affiliate shall mean any company or entity
owned directly or indirectly by one of the entities above, and such above entity
owns more than fifty percent (50%) of the stock with entitlement to vote for
directors or persons performing a function similar to that of directors.
or
2. The
Acquiring Party of Wintegra Inc. or Wintegra Ltd. is not the Affiliate of or
successor to an entity set forth above, but following a Change of Control of
Wintegra, the Acquiring Party does not provide TI within thirty (30) days after
the effective date of the Change of Control a written and binding assurance
as
set forth below (the “Acquiring Party Agreement”) that it will cause Wintegra
Inc. or Wintegra Ltd. (as the case may be) to continue to perform its
obligations under this Agreement.
_____________________
[†]
Information redacted pursuant to a confidential treatment request by Wintegra,
Inc. under 17 CFR §§ 200.80(b)(4) and 230.406 and submitted separately with the
Securities and Exchange Commission.
C.
Force
Majeure.
Wintegra
becomes (i) unable to maintain a Timely and Acceptable Supply of Wintegra
Products for TI customers due to strikes, riots, fires, explosions, acts of
God,
war, governmental action or any other cause that is beyond the reasonable
control of Wintegra. For purposes of this Appendix, a “Timely and Acceptable
Supply of Wintegra Products” means delivery of Wintegra Product which
substantially meets the specifications set forth in Appendix 1 of this Agreement
to the TI customer within fourteen (14) weeks of such customer placing an order
and (ii) fails to submit an acceptable cure plan to TI within twenty (20) days
of the occurrence of such force majeure event and diligently follow such cure
plan to completion.
D.
Unexcused Failure to Timely Supply
Wintegra
(i) fails to deliver Wintegra Products to Mutual Customers within fourteen
(14)
weeks of order placement, (ii) such failure or delay cannot be attributable
to a
reasonable business justification (an example of a reasonable business
justifications include industry-wide capacity constraints from suppliers,
fabrication sources, and test vendors), and (iii) the Parties, after good faith
negotiation, are unable to reach an agreement regarding how to address such
Wintegra’s supply delays and failure.
Acquiring
Party Agreement
_______________________,
a ______________ corporation, with a principal place of business at
___________________________ (herein "Acquiring Party"), represents that it
has
read the “Supply and License Agreement” and “Co-Marketing and Software License
Agreement” ("Agreements") executed between Wintegra Inc. (“Wintegra”) and Texas
Instruments Incorporated (“TI”) with an effective dates of _______, and agrees
that it shall cause Wintegra or its successor to comply with the Agreements.
Acquiring Party acknowledges that pursuant to the terms of such Agreements,
if
Wintegra or its successor fails to maintain a timely supply of Wintegra Products
(as defined in the Supply and License Agreement), such failure shall constitute
a Release Condition as described in the Supply and License Agreement. Acquiring
Party further acknowledges that, with respect to delivery of the High Density
Solution (as defined in the Supply and License Agreement), time is of the
essence, and customers typically require the product within fourteen (14) weeks
of an order. Acquiring Party agrees that in the event that Wintegra or its
successor breaches the Agreement after TI receives this assurance, and TI
establishes that this assurance was given by Acquiring Party in order to deny
TI
the ability to exercise its right to obtain release of the Escrow Materials
as
set forth in the Agreement, Acquiring Party shall be liable to TI for all
damages, without limitation, suffered by TI as a result of such
breach.
By:
_________________________
Name:
_______________________
Title:
________________________
Date:
_________
Appendix
5
Mutual
Customers
[intentionally
left blank]
Significant
Customers
[intentionally
left blank]
