INTELLECTUAL PROPERTY LICENSE AGREEMENT
This
Intellectual Property License Agreement (the “Agreement”) is effective as of the
Closing Date (as defined herein), between Avid Technology, Inc., a Delaware
corporation (“Parent”) and Pinnacle Systems, Inc., a California corporation and
wholly owned subsidiary of Parent, (“Pinnacle” and together with Parent,
individually and collectively, “Seller”), and PCTV Systems S.a.r.l., a
Luxembourg company (“Buyer”).
ARTICLE
I
For the
purpose of this Agreement, (i) all capitalized terms used herein that are
defined in the Asset Purchase Agreement shall have the meaning ascribed thereto
and (ii) the following capitalized terms are defined in this Article I and shall
have the meaning specified herein:
1.1 “Confidential
Information” has the meaning set forth in Article III.
1.2 “Exploit,” with
respect to Technology, means use, operate, design, develop, integrate, optimize,
test, modify, debug, manufacture, sell, import, offer for sale, distribute,
reproduce, service, maintain, repair and create derivative works of such
Technology and to have any of the foregoing done. Related terms such
as “Exploitation” shall have their correlative meanings.
1.3 “Improvements” to
Technology means (a) with respect to works of authorship, any modifications,
derivative works, and translations of works of authorship; (b) with respect to
databases, any database that is created by extraction or re-utilization of
another database; and (c) with respect to other items included within the
definition of Technology and not covered by Sections (a) – (b) above, any
improvements of Technology. For the purposes of clarification, an
item of Technology will be deemed to be an Improvement of another item of
Technology only if it is actually derived from such other item of Technology and
not merely because it may have the same or similar functionality or use as such
other item of Technology.
1.4 “Intellectual Property
Rights” means, except as expressly set forth below, all intellectual
property rights, including, without limitation, the rights associated with the
following: (a) trade secret rights and all other rights in or to
confidential business or technical information (“Trade Secrets”); (b)
copyrights in any original works of authorship fixed in any tangible medium of
expression as set forth in 17 U. S.C. Section 101 et. seq., any foreign
copyrights under the laws of any jurisdiction, in each case, whether registered
or unregistered, and any applications for registration thereof, and moral rights
under the laws of any jurisdiction (“Copyrights”); and (c)
rights in databases and data collections (including knowledge databases,
customer lists and customer databases), under the laws of the United States or
any other jurisdiction, whether registered or unregistered, and any applications
for registration thereof (“Database
Rights”). “Intellectual Property Rights” specifically excludes
patents, utility models, design patents, design registrations, certificates of
invention and other governmental grants for the protection of inventions or
industrial designs anywhere in the world and all reissues, renewals,
re-examinations, continuations, divisionals, substitutions and extensions of any
of the foregoing; and contractual rights (including license grants) and also
excludes the tangible embodiment of any of the foregoing.
1.5 “Licensed Business
Intellectual Property Rights” means all Intellectual Property Rights that
are owned by Seller or any Subsidiary of Seller as of the Closing Date in and to the Licensed
Business Technology. For clarity, Licensed Business Intellectual
Property Rights excludes the Seller PCTV Intellectual Property.
1.6 “Licensed Business
Technology” means the Technology that is owned by Seller or any
Subsidiary of Seller and set forth in Schedule A
hereto. For clarity, Licensed Business Technology excludes Seller
PCTV Intellectual Property and all products and Technology of Seller and its
Subsidiaries that are not expressly
set forth in Schedule
A, such as, without limitation, Seller’s “VideoSpin”
product.
1.7 “Licensed Field of
Use” means the development, manufacture and sale of personal devices
containing a television tuner for receiving over-the-air, satellite and cable
television signals that are used in conjunction with personal computers for
personal television viewing and the application software designed to operate
directly with such personal devices for device management, playback and
programming received through such personal devices.
1.8 “Subsidiary” or “Subsidiaries” of
Buyer, Seller or any other Person means any corporation, partnership or other
legal entity of which Buyer, Seller or such other Person, as the case may be
(either alone or through or together with any other Subsidiary), owns, directly
or indirectly, more than 50% of the stock or other equity interests the holder
of which is generally entitled to vote for the election of the board of
directors or other governing body of such corporation or other legal
entity.
1.9 “Technology” means
tangible embodiments, whether in electronic, written or other media, of
technology, including inventions, ideas, designs, documentation (such as xxxx of
materials, build instructions and test reports), schematics, layouts, reports,
algorithms, routines, software (including source code and object code), data,
databases, lab notebooks, equipment, processes, prototypes and
devices. Technology does not include Intellectual Property Rights in
any of the foregoing.
1.10 “Third Party” means a
Person other than Seller and its Subsidiaries or Buyer and its
Subsidiaries.
1.11 “VideoSpin” means the
VideoSpin software (a) owned by Seller and marketed by Seller under the name
VideoSpin and (b) installed on physical media in the inventory delivered by
Seller to Buyer on the Closing Date.
ARTICLE
II
(a) Seller
grants to Buyer and its Subsidiaries the following irrevocable (except as set forth in Article IV),
personal, non-exclusive, worldwide, fully paid, royalty-free and
non-transferable (except as specified in Section 7.5 below) licenses, in
perpetuity, under its and their applicable Licensed Business Intellectual
Property Rights, solely within the Licensed Field of Use:
(i) under its
and their Copyrights in and to the Licensed Business Technology, (A) to
reproduce and have reproduced the works of authorship included in such Licensed
Business Technology, (B) to prepare Improvements or have Improvements prepared
for it based upon the works of authorship included in such Licensed Business
Technology, (C) to distribute (by any means and using any technology, whether
now known or unknown, including without limitation electronic transmission)
copies of the works of authorship included in such Licensed Business Technology
and Improvements thereof prepared by or for Buyer to the public in accordance
with Sections 2.1(b) and 2.1(c) below, (D) to perform (by any means and using
any technology, whether now known or unknown, including without limitation
electronic transmission) and display the works of authorship included in such
Licensed Business Technology and Improvements thereof prepared by or for Buyer;
and (E) subject to Sections 2.1(b) and 2.1(c) below, to otherwise Exploit the
works of authorship included in such Licensed Business Technology.
(ii) under its
and their Database Rights in and to the Licensed Business Technology, to extract
data from the databases included in such Licensed Business Technology and to
re-utilize such data to Exploit products or services in the Licensed Field of
Use; and
(iii) under its
and their Trade Secrets in and to the Licensed Business Technology, to use such
Licensed Business Technology and Improvements thereof prepared by or for Buyer
to Exploit products or services in the Licensed Field of Use.
(b) With
respect to software included within the Licensed Business Technology, such
licenses include the right to use, modify, make Improvements and reproduce such
software and Improvements thereof made by or for Buyer or its Subsidiaries, in
source code and object code form, to create products and services in the
Licensed Field of Use, and to distribute and maintain such software and
Improvements thereof made by or for Buyer or its Subsidiaries, in object code
form only, as part products or services in the Licensed Field of
Use.
(c) Buyer
may grant sublicenses within the scope of the licenses granted under Sections
2.1(a) above solely as follows:
(i) Buyer may
grant sublicenses to its Subsidiaries for so long as they remain its
Subsidiaries, with no right to grant further sublicenses, provided that Buyer
shall be deemed responsible for the acts of such Subsidiaries as if they were a
party to this Agreement; and
(ii) Buyer may
grant sublicenses with respect to products solely in the Licensed Field of Use
in the form of software, in object code form only, to its distributors,
resellers, contractors, OEM customers, VAR customers, VAD customers, systems
integrators and other channels of distribution and to its end user customers;
provided that,
such sublicenses shall be consistent in all respects with this Agreement and
shall include standard terms and conditions consistent with end-user object code
license agreements of Seller prior to the date hereof, including, without
limitation, prohibitions on reverse engineering of object code and limitations
of liability.
(d) Buyer
shall own all Intellectual Property Rights in any Improvements to the Licensed
Business Technology made by or for Buyer or its Subsidiaries in accordance with
this Article II.
(a)
Seller grants to Buyer a royalty-free, non-transferable, limited, non-exclusive
license to distribute copies of VideoSpin solely pursuant to such end-user terms
and conditions as are provided or made available by Seller to Buyer and/or such
end user. Buyer’s rights granted under this Section 2.5 are limited
to the executable object code version of VideoSpin as it is incorporated in the
inventory delivered to Buyer by Seller on the Closing Date.
(b)
Seller and its Subsidiaries and/or licensors reserve all rights not expressly
granted in this Section 2.5 to VideoSpin and, except as stated in this Section
2.5, Buyer shall make no other utilization of VideoSpin, or use VideoSpin for
the benefit of any other person or entity, or permit any Third Party to make
such utilization, and Buyer shall have no other rights or licenses with respect
to VideoSpin (including rights under any copyrights, patents or other
intellectual property of Seller).
(c)
Without limiting the generality of clause (b) above, and except as expressly
permitted by this Agreement, Buyer agrees: (i) not to copy, modify, port,
translate, localize, or create derivative works of VideoSpin; (ii) not to
disassemble, decompile, reverse engineer or otherwise reduce VideoSpin to source
code form; (iii) not to remove, or allow to be removed, any patent, trademark,
copyright, trade secret, or other proprietary rights notice placed by Seller or
its supplier on VideoSpin; (iv) not to use VideoSpin, or any portion thereof on
a service bureau, time sharing or ASP basis; and (v) not to appoint any
subdistributor, reseller, sales agent or other representative to market or
distribute VideoSpin.
(d)
Seller and Buyer shall negotiate in good faith the terms of any additional Buyer
distribution rights to VideoSpin.
ARTICLE
III
(b) To
be considered Confidential Information, information disclosed after the Closing
Date must (i) be marked as confidential at the time of disclosure; or (ii) if
unmarked (e.g. orally disclosed), be treated as confidential at the time of
disclosure and designated as confidential in a written memorandum sent to the
receiving party’s primary representative within thirty (30) days of disclosure,
summarizing the information sufficiently for identification.
(c) Confidential
Information of Third Parties that is known to, in the possession of or acquired
by a receiving party pursuant to this Agreement shall be deemed the disclosing
party’s Confidential Information for purposes herein.
(d) For
purposes of clarification, Confidential Information of the Seller includes, but
is not limited to, Licensed Business Technology, subject to the terms of Section
3.2 below.
ARTICLE
IV
ARTICLE
V
5.1 Buyer
acknowledges that its employees and contractors who are former Seller employees
and contractors have a continuing duty to assist Seller with in connection with
any Third Party infringement claim or action against Seller, and accordingly,
Buyer agrees to make available, to Seller or its counsel, inventors and other
persons employed by Buyer for interviews and/or testimony to assist in
connection therewith, including the signing of documents related thereto. Any actual and
reasonable out-of-pocket expenses associated with such assistance shall be borne
by Seller, expressly excluding the value of the time of such Buyer personnel;
provided,
however, that in the case of assistance with litigation or any other
assistance that requires significant time commitment by Buyer’s personnel, the
parties shall agree on a case by case basis on compensation of Buyer for the
value of the time of Buyer’s employees as reasonably required in connection with
such litigation.
5.2 On the
Closing Date, Seller shall provide to Buyer the source code and
object code to the Licensed Business Technology, together with database schemas,
user interface specifications, logic flow diagrams, development
documentation comprising a part of
such Licensed Business Technology, including developer notes and memoranda for
such Licensed Business Technology, and a listing of development tools currently
used in creating, enhancing and maintaining the Licensed Business Technology,
and a listing of required third party software currently used by Seller with
respect to the Licensed Business Technology, in each case, to the extent that
such information or Technology is reasonably available to Seller on the Closing
Date and Seller may provide such information or Technology without violating any
right of any third party (collectively, the “Source Code
Materials”). Such material shall be provided in a usable electronic
format.
ARTICLE
VI
6.1 IN
NO EVENT SHALL EITHER PARTY OR ITS AFFILIATES BE LIABLE TO THE OTHER PARTY OR
ITS AFFILIATES FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT, INCIDENTAL OR PUNITIVE
DAMAGES OR LOST PROFITS, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY
(INCLUDING NEGLIGENCE) ARISING IN ANY WAY OUT OF THIS AGREEMENT, WHETHER OR NOT
SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THE
FOREGOING SHALL NOT, HOWEVER, LIMIT THE DAMAGES AVAILABLE TO EITHER PARTY UNDER
APPLICABLE LAW FOR INFRINGEMENT OR MISAPPROPRIATION OF ITS OR ITS AFFILIATES’
INTELLECTUAL PROPERTY RIGHTS BY THE OTHER PARTY OR SUCH OTHER PARTY’S
AFFILIATES.
ARTICLE
VII
If to the
Buyer:
Hauppauge
Digital, Inc.
00
Xxxxx Xxxxx
Xxxxxxxxx,
Xxx Xxxx 00000
Facsimile: (000)
000-0000
Attention:Xxxxxxx
Xxxxxxx
|
Copy
to:
Certilman
Balin Xxxxx & Xxxxx, LLP
00
Xxxxxxx Xxxxxx
Xxxx
Xxxxxx, Xxx Xxxx 00000
Facsimile:
(000) 000-0000
Attention:
Xxxxxx X. Xxxxxxxxxxx, Esq.
|
If to any
Seller:
Avid
Technology, Inc.
Avid
Technology Park
Xxx
Xxxx Xxxx
Xxxxxxxxx,
XX 00000
Facsimile: (000)
000-0000
Attention:Legal
Department
|
Copies
to:
Xxxxxx
Xxxxxx Xxxxxxxxx Xxxx and Xxxx LLP
0000
X. Xxxxxxxxxx Xxxxxx
Xxxx
Xxxx, XX 00000
Facsimile:
(000) 000-0000
Attention:
Xxx X. Xxxxxx and Xxxxxx X. Xxxxx
|
Any Party
may give any notice, request, demand, claim, or other communication hereunder
using any other means (including personal delivery, expedited courier, messenger
service, telecopy, telex, ordinary mail, or electronic mail), but no such
notice, request, demand, claim or other communication shall be deemed to have
been duly given unless and until it actually is received by the party for whom
it is intended. Any Party may change the address to which notices,
requests, demands, claims and other communications hereunder are to be delivered
by giving the other Parties notice in the manner herein set forth.
7.11 GOVERNING
LAW. This Agreement and any disputes hereunder shall be governed by
and construed in accordance with the internal laws of the State of New York
without giving effect to any choice or conflict of law provision or rule
(whether of the State of New York or any other jurisdiction) that would cause
the application of laws of any jurisdiction other than those of the State of New
York.
7.12 SUBMISSION
TO JURISDICTION. Each Party (a) submits to the exclusive jurisdiction
of any state or federal court sitting in New York, New York in any action or
proceeding arising out of or relating to this Agreement, (b) agrees that all
claims in respect of such action or proceeding may be heard and determined only
in any such court, (c) waives any claim of inconvenient forum or other challenge
to venue in such court, and (d) agrees not to bring any action or proceeding
arising out of or relating to this Agreement in any other court. Each
Party agrees to accept service of any summons, complaint or other initial
pleading made in the manner provided for the giving of notices in Section
7.6. Nothing in this Section 7.12 however, shall affect the right of
any Party to serve such summons, complaint or initial pleading in any other
manner permitted by law.
7.13 CONSTRUCTION.
(a) The
language used in this Agreement shall be deemed to be the language chosen by the
Parties to express their mutual intent, and no rule of strict construction shall
be applied against any Party.
(b) Any
reference to any federal, state, local, or foreign statute or law shall be
deemed also to refer to all rules and regulations promulgated thereunder, unless
the context requires otherwise.
(c) The
section headings contained in this Agreement are inserted for convenience only
and shall not affect in any way the meaning or interpretation of this
Agreement.
(d) Any
reference herein to an Article, section or clause shall be deemed to refer to an
Article, section or clause of this Agreement, unless the context clearly
indicates otherwise.
(e) All
references to “$”, “Dollars” or “US$” refer to currency of the United States of
America.
(f) As used
in this Agreement, the word “including” and its variants shall mean “including,
without limitation,” the masculine gender shall include the feminine and the
neuter, and the singular number shall include the plural, and vice
versa.
SELLERS:
Avid
Technology, Inc.
By: /s/ Xxx Xxxxxx
Name:
Xxx Xxxxxx
Title:
Chief Financial Officer
Pinnacle
Systems, Inc.
By: /s/ Xxx Xxxxxx
Name: Xxx Xxxxxx
Title: President
[Signature
page to Intellectual Property License Agreement]
BUYER:
PCTV
Systems S.a.r.l.
By: /s/ Xxx Xxxxxxx
Name:
Xxx Xxxxxxx
Title:
Chairman
[Signature
page to Intellectual Property License Agreement]
SCHEDULE
A
LICENSED
BUSINESS TECHNOLOGY