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EXHIBIT 10.50
LICENSE AGREEMENT
This License Agreement ("Agreement") dated as of June 1, 1998
("Effective Date"), is by and between MAXTOR CORPORATION ("Maxtor"), a Delaware
corporation, having principal places of business at 000 Xxxxxxxxxx Xxxxxx,
Xxxxxxxx, Xxxxxxxxxx 00000 and 0000 Xxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxx 00000, and
Hyundai Electronics Industries, Co. Ltd. ("HEI"), a Korean corporation, having
its principal place of business at San 000-0, Xxx-xx, Xxxxx-xxx, Xxxxx-xxx,
Kyougki-do, 467-860 Korea.
RECITALS
WHEREAS, Maxtor Corporation is a majority-owned subsidiary of Hyundai
Electronics America ("HEA");
WHEREAS, HEA currently owns 100% of Maxtor Corporation's Series A
Preferred Stock;
WHEREAS, Maxtor Corporation is contemplating a firm commitment,
underwritten public offering of its Common Stock (the "Public Offering")
pursuant to which HEA's Series A Preferred Stock would be converted into Common
Stock and Maxtor Corporation would no longer be a Subsidiary of HEA;
Whereas, HEI desires to acquire, when and in the event that Maxtor is no
longer a subsidiary of HEI, a license from Maxtor to use certain Maxtor patents
and Maxtor desires to acquire, when and in the event that Maxtor is no longer a
subsidiary of HEI, a license from HEI to use certain HEI patents, in each case
for the manufacture, use, and sale of Licensed Products as defined below. Maxtor
and HEI desire to grant such licenses to each other in exchange for certain
valuable consideration as recited herein; and
Whereas, if problems should be encountered with respect to any aspect of
this Agreement or if the parties should encounter any problems not covered by
this Agreement, Maxtor and HEI shall discuss them in a cooperative and sincere
spirit and attempt to arrive at a mutually acceptable solution;
NOW THEREFORE, the parties agree as follows:
1. DEFINITIONS
1.1 "Licensed Products" shall mean Information Handling Systems or any
instrumentality or aggregate of instrumentalities (including, without
limitation, any component, subassembly, computer program or supply) designed for
incorporation in an Information Handling System.
LICENSE AGREEMENT
June 25, 1998
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1.2 "Licensed Patents" shall mean any utility patents, utility models,
and design patents, including without limit any reissues, divisions,
continuations, continuations in part, extensions, reexaminations, or foreign
counterparts thereof whether in whole or in part, and any applications for such
patents, wherever filed, which (a) is entitled to an effective first filing or
priority date on or before the end of the Capture Period and (b) under which
patents or the applications therefor a party hereto or any of its Subsidiaries
now owns or controls or has or may hereafter during the term of this Agreement
own or control or have and under which and to the extent to which such party has
the right to grant license of the scope granted herein without payment of
royalties or other consideration to third parties, except for payments to third
parties for inventions made by such third parties while employed by such party.
1.3 "Subsidiary" of a party hereto shall mean a corporation, company or
other entity more than fifty percent (50%) of whose outstanding shares or
securities are, now or hereafter, owned or controlled, directly or indirectly,
by a party hereto, but such corporation, company or other entity shall be deemed
to be a Subsidiary only so long as such ownership or control exists.
1.4 "Capture Period" shall mean the period of time from and including
the Effective Date to and including August 31, 2003.
1.5 "Information Handling System" shall mean any instrumentality or
aggregate of instrumentalities primarily designed to compute, classify, process,
transmit, receive, retrieve, originate, switch, store, display, manifest,
measure, detect, record, reproduce, handle or utilize any form of information,
intelligence or data for business, scientific, control or other purposes.
2. RELEASE/LICENSES
2.1. Effective as of the date Maxtor ceases to be a Subsidiary of HEI,
Maxtor, on behalf of itself and its Subsidiaries, hereby releases HEI and its
Subsidiaries from all claims of infringement accruing prior to the Effective
Date of this Agreement based on the Licensed Patents. In addition, Maxtor, on
behalf of itself and its Subsidiaries, agrees not to make any claim, demand or
request against HEI or any of its Subsidiaries arising under any patent other
than Licensed Patents for any infringement or declaratory relief accruing, and
to the extent of accrual, prior to the Effective Date of this Agreement.
2.2. Effective as of the date Maxtor ceases to be a Subsidiary of HEI,
Maxtor, on behalf of itself and its Subsidiaries, hereby grants to HEI a
non-exclusive, world-wide, royalty-free license under the Licensed Patents to
make, have made, have developed, use, lease, sell, offer for sale, import,
export or otherwise dispose of Licensed Products, including the rights to have
assembled and tested such Licensed Products.
LICENSE AGREEMENT
June 25, 1998
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2.3 Effective as of the date Maxtor ceases to be a Subsidiary of HEI,
HEI, on behalf of itself and its Subsidiaries, hereby releases Maxtor and its
Subsidiaries from all claims of infringement accruing prior to the Effective
Date of this Agreement based on the Licensed Patents. In addition, HEI, on
behalf of itself and its Subsidiaries, agrees not to make any claim, demand or
request against Maxtor or its Subsidiaries arising under any patent other than
Licensed Patents for any infringement or declaratory relief accruing, and to the
extent of accrual, prior to the Effective Date of this Agreement.
2.4 Effective as of the date Maxtor ceases to be a Subsidiary of HEI,
HEI, on behalf of itself and its Subsidiaries, hereby grants to Maxtor during
the term of this Agreement, a non-exclusive, world-wide, royalty-free under the
Licenses Patents to make, have made, have developed, use, lease, sell, offer for
sale, import, export or otherwise dispose of Licensed Products, including the
right to have assembled and tested such Licensed Products.
2.5 Subject to Section 2.6, the licenses and other rights granted herein
shall include the right of each party to grant sublicenses to its Subsidiaries,
which sublicenses may include the right of sublicensed Subsidiaries to
sublicense other Subsidiaries of said party. No sublicense shall be broader in
any respect at any time during the life of this Agreement than the license or
sublicense held at that time by the party or Subsidiary that granted the
sublicense.
2.6 A sublicense granted to a Subsidiary shall terminate on the earlier
of:
(a) the date such Subsidiary ceases to be a Subsidiary; and
(b) the date of termination or expiration of the license or
sublicense of the party or Subsidiary that granted the
sublicense.
If a Subsidiary ceases to be a Subsidiary and holds any patents and/or patent
applications which are Licensed Patents, such patents and patent applications
will continue to be Licensed Patents for the term defined herein.
2.7 HEI shall have the right to grant, at such time and in the event
that MaxMedia Corporation (MMC) ceases to be a Subsidiary of HEI, a
non-assignable, non-exclusive sublicense limited to the manufacture and sale of
hard disk drive media to MMC under the Licensed Patents owned, filed, or
controlled by Maxtor at or prior to the date MMC ceases to be a Subsidiary of
HEI, for the lives of such Licensed Patents.
2.8 Notwithstanding anything in this Agreement to the contrary, no
release or license is granted by either party hereunder either directly, by
implication, estoppel or otherwise, under any patent, copyright, trade secret or
maskwork except as expressly provided herein. In particular, neither party
grants the other any license or immunity to make, have made, have developed,
use, lease, sell, offer for sale, import, export or otherwise dispose of any
products other than Licensed Products.
LICENSE AGREEMENT
June 25, 1998
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2.9 Except as expressly provided herein, no license or immunity is
granted under this Agreement by either party, either directly or by implication,
estoppel or otherwise to any third parties acquiring items from either party for
the combination of such acquired items with other items (including items
acquired from either party hereto) or for the use of such combination.
2.10 Except as otherwise provided herein, no license granted hereunder
includes the right to sublicense any third party.
2.11 In the event that neither a party nor any of its Subsidiaries has
the right to grant a license under any particular Licensed Patent of the scope
set forth in Section 2, then the license granted herein under said Licensed
Patent shall be of the broadest scope which said party or any of its
Subsidiaries has the right to grant within the scope set forth above.
2.12 Except as provided in Section 5.3, below, the licenses granted
hereunder are irrevocable and do not terminate as to any Licensed Patent
notwithstanding any sale, assignment, or other disposition by a party of any
such Licenses Patent.
3. NO PAYMENTS
There shall be no payments of royalties or any similar amounts under
this Agreement.
4. NON-ASSIGNMENT
No party may assign this Agreement or any interest or rights granted
hereunder to any third party without the prior written consent of the other
party and any such purported assignment shall be null and void. However, in the
event that either party or substantially all the business or assets of such
party relating to Licensed Products is acquired by a third party (the
"acquiror") by merger or acquisition and such acquired party, business, or
assets continues to be operated substantially independently as a legal entity
separate from such third party, such separate legal entity shall succeed to all
rights and obligations under this Agreement for so long as such separate legal
entity continues to operate substantially independently from the acquiror. In
such event, the acquiror will have no license hereunder under any patents or
patent applications, whether or not Licensed Patents, owned, acquired, or filed
by the non-acquired party. In the event that such acquired party ceases to be
substantially independently operated as a separate legal entity,
(1) the scope of the license held by the acquired party shall,
retroactive to the date of such merger or acquisition, be limited
to Licensed Products that represented a continuation of a product
line of the assigning party and that were derived from Licensed
Products of such party that exist as of the time of the
assignment; and
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June 25, 1998
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(2) unless the acquiror grants the non-acquired party a license of
similar scope under all patents owned or filed by such party or
its Subsidiaries during the Capture Period, all licenses granted
to the acquired party shall terminate, retroactive to the date of
the merger or acquisition by the acquiror.
5. TERM AND TERMINATION
5.1 Unless earlier terminated under the provisions of this Agreement,
the term of the licenses granted under this Agreement shall be from the
Effective Date until the last to expire of the Licensed Patents.
5.2 At any time during the last six (6) months of the Capture Period,
either party may request negotiations to consider the possible extension of the
Capture Period. In that case, both parties will enter into good faith
negotiations to determine whether they can agree upon an acceptable extension.
5.3 Either party may terminate this Agreement upon written notice if the
other:
(a) becomes insolvent;
(b) files a petition in bankruptcy or such a petition is filed
for such party; (unless the petition in bankruptcy is filed pursuant to Chapter
11 of the U.S. Bankruptcy Code or similar provision of foreign law); and
(c) materially breaches this Agreement, and such violation
continues for thirty (30) days after one party gives notice to the other party
of such violation.
5.4 In the event of termination of this Agreement by one party
("terminating party") pursuant to section 5.3 above, the releases and licenses
granted hereunder to the terminating party and its Subsidiaries shall survive
the termination to the extent already granted to them hereunder as of the date
of such termination.
6. MISCELLANEOUS PROVISIONS
6.1 Nothing contained in this Agreement shall be construed as:
(a) a warranty or representation by either party as to the
validity or scope of any patent; or
(b) a warranty or representation by either party that any
manufacture, sale, lease, use or other disposition of any Licensed Product would
be free from infringement of patents other than those under which and to the
extent to which licenses are granted by Maxtor or HEI hereunder; or
(c) an agreement by either party to bring or prosecute actions or
suit against third parties for infringement or conferring any right to bring or
prosecute actions or suit against third parties for infringement; or
LICENSE AGREEMENT
June 25, 1998
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(d) conferring to either party by the other any license or right
to use in advertising, publicity or otherwise any trademark, trade or brand name
or names, or corporate name; or
(e) an obligation by either party to furnish any technical
information or know-how, or
(f) an admission by either party concerning the validity of any
patent or responsibility for infringement of any patent.
6.2 This Agreement will be governed by and construed in accordance with
the laws of the United States and its State of California, as such law applies
to contracts signed and fully performed in California.
6.3 The parties shall meet in good faith to resolve by mutual agreement
any disputes arising under this Agreement. In the event that such negotiations
do not result in the resolution within 90 days of the first notification of a
dispute, the parties are free to pursue such other avenues of relief as may be
available at law or equity.
6.4 All notices required to be sent by either party under this Agreement
will be sent to the following addresses or such other address as may
subsequently be designated in writing.
Maxtor: Maxtor Corporation
0000 Xxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000 X.X.X.
Attention: Xx. Xxxxx X. Xxxxxxx
Vice President, General Counsel and Secretary
Facsimile: (000) 000-0000
HEI: Hyundai Electronics Industries Co. Ltd.
12th Floor Hyundai Jeonja Xxxxxxxx
00 Xxxxxxxxx-xxxx, Xxxxxxx-xx
Xxxxx, Xxxxx
Attention: Senior Manager, Patent Department
Facsimile: 000-00-0000-0000
LICENSE AGREEMENT
June 25, 1998
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6.5 This Agreement constitutes the full and complete understanding and
agreement between the parties hereto and supersedes all prior understandings and
agreements relating to the subject matter hereof. No modifications, alterations
or amendments shall be effective unless in writing and signed by both parties to
this Agreement. No waiver of a breach in a particular situation shall be held to
be a waiver of any other or subsequent breach.
6.6 Maxtor and HEI agree to cooperate to obtain any necessary approval
of the United States or the Korean government.
AGREED TO:
MAXTOR CORPORATION HYUNDAI ELECTRONICS
INDUSTRIES, CO., LTD.
By: /s/ Xxxxx X. Xxxxxxx By: /s/ X.X. Xxxxx
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Name: Xxxxx X. Xxxxxxx Name: X.X. Xxxxx
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Title: VP, General Counsel and Secretary Title: Director
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Date: June 25, 1998 Date: June 25, 1998
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