C 0 M P R E H E N S I V E - C D D I S C
L I C E N S E A G R E E M E N T
AGREEMENT, having an effective date of January 1, 1996 by and between U.S.
Philips Corporation having its principal office at 000 Xxxxx Xxxxxx Xxxx,
Xxxxxxxxx, Xxx Xxxx 00000 (hereinafter referred to as "USPC") and Hauppauge
Record Manufacturing having its principal office at 00 Xxxxxx Xxxxxx, Xxxxxxxxx,
Xxx Xxxx 00000 (hereinafter referred to as "Licensee").
WHEREAS, the Philips' Group of Companies (hereinafter referred to as
"Philips") has for many years been engaged in research and development of
systems, in which signals encoded in digital form and stored on a disc are read
and reproduced by means of devices using an optical read out beam, and has
obtained valuable know-how and experience thereby;
WHEREAS, one of the achievements of such research and development efforts
was a new and revolutionary high-fidelity sound storage and reproduction system,
which was further developed and defined in a cooperation with Sony Corporation
of Japan and has been jointly presented under the name "Compact Disc Digital
Audio System" (CD-A);
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WHEREAS, on the basis of this "Compact Disc Digital Audio System" three
further systems have been defined in a cooperation with Sony Corporation of
Japan and have been jointly presented under the names "Compact Disc Data System"
(CD-ROM);"CDV System (CDV) and "Compact Disc Interactive System" (CD-i);
WHEREAS, a multi-session CD system has been defined by Philips and Sony and
jointly presented under the name "Enhanced Music Compact Disc System", which
system is capable of storing sound and data respectively in two sessions on an
optical disc;
WHEREAS, Licensee desires the right to manufacture and sell discs utilizing
any or all of the above CD-A, CD-ROM, CDV, CD-i and Enhanced Music CD Systems
(jointly hereinafter referred to as "CD Systems", and wishes such discs to be
interchangeable with the discs manufactured and sold by the Philips' Group of
Companies and others utilizing such CD-Systems;
WHEREAS, USPC owns and/or controls the right to license patent rights
pertinent to the CD-Systems and owns additional patent rights pertinent to
optical disc manufacturing in general;
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WHEREAS, USPC has been authorized by Sony to license patents owned by Sony
and indicated on the Exhibits hereto under the terms and conditions specified
herein, while Sony retains the right to also license such patents;
WHEREAS, Licensee understands that USPC is willing to license any one or
more patents owned by it for optical disc manufacturing, whether within or
outside(1) of the Standard Specifications defining the CD Systems on reasonable
terms and conditions; and
WHEREAS, in furtherance of Licensee's efforts to manufacture and sell discs
which are interchangeable within the respective CD-Systems, Licensee has
requested USPC for a license under patent rights pertinent to the CD-Systems,
which USPC has the free right to license, and, in addition, has requested USPC
to disclose and make available certain basic information on the CD-Systems;
NOW, THEREFORE, in mutual consideration of the premises and the faithful
performance of the mutual covenants
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(1) or further information please contact Xxxxxxx X. Xxxxxx, U.S. Philips
Corporation, 000 Xxxxx Xxxxxx Xxxx, Xxxxxxxxx, XX 00000
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hereinafter set forth, the parties hereto have agreed as follows:
Article I - DEFINITIONS
As used in this Agreement the following terms shall have the following
meanings, unless the context clearly requires otherwise:
1.01 Disc - any non-recordable, reflective, disc-shaped information carrier
comprising any kind of information such as, but not limited to,
audio/video/text/data related information, which information is
irreversibly stored in a layer during and as an integral part of the
manufacturing process of the disc, in a form which is optically readable by
playback devices.
1.02 CD-Audio Disc - any Disc comprising audio information encoded in digital
form, which is optically readable by a CD-Audio-Player (as hereinafter
defined) and conforms to the CD-Audio Standard Specifications (as
hereinafter defined).
1.03 CD-ROM Disc - any Disc comprising information encoded in digital form,
which is optically readable by a CD-ROM Player (as hereinafter defined) and
conforms to either the
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CD-ROM Standard Specifications (as hereinafter defined) or the CD-ROM(XA)
Standard Specifications (as hereinafter defined).
1.04 CD-i Disc - any Disc comprising any kind of information such as, but not
limited to audio, video, text and data related information, encoded in
digital form, which is optically readable by a CD-i Player (as hereinafter
defined) and conforms to the CD-i Standard Specifications (as hereinafter
defined).
1.05 CDV-Disc - any Disc comprising television picture information consisting of
analog video information with digital audio information, and with or
without additional information to be used for control, retrieval,
educational and/or instructional purposes in relation to the visual display
of said television picture information, which is optically readable by a
CDV-Player (as hereinafter defined) and conforms to the CDV-Standard
Specifications (as hereinafter defined).
1.06 Enhanced Music CD Disc - any disc comprising any kind of information such
as, but not limited to, audio, video, text and data related information
encoded in digital form
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and which conforms to the Enhanced Music CD-Standard Specifications (as
hereinafter defined).
1.07 CD-Audio Standard Specifications - the specifications for the
CD-Audio-Disc/Player parameters as made available, modified or added to
from time to time in accordance with the provisions of Article III hereof.
1.08 CD-ROM Standard Specifications - the specifications for the CD-ROM
Disc/Player parameters as made available, modified or added to from time to
time in accordance with the provisions of Article III hereof.
1.09 CD-ROM(XA) Standard Specifications - the specifications for the CD-
ROM(XA)Disc/Player parameters as made available, modified or added to from
time to time in accordance with the provisions of Article III hereof.
1.10 CD-i Standard Specifications - the specifications for the CD-i Disc/Player
parameters (as hereinafter defined) as made available, modified or added to
from time to time in accordance with the provision of Article III hereof.
1.11 CDV-Standard Specifications - the NTSC and/or PAL specifications for the
CDV-Disc/Player parameters as made available, modified or added to from
time to time in
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accordance with the provisions of Article III hereof.
1.12 Enhanced Music CD-Standard Specifications - the specifications for the
Enhanced Music CD-Disc/Player parameters as made available, modified or
added to from time to time in accordance with the provisions of Article III
hereof.
1.13 Player - any playback device for optically reading information stored on a
Disc and converting such information into electrical signals for
reproduction purposes.
1.14 CD-Audio Player - a Player which is designed and manufactured solely for
the reproduction of information stored on a CD-Audio Disc and conversion of
such information, which is bit-encoded according to the CD-Audio Standard
Specifications, into electrical signals by means prescribed in the CD-Audio
Standard Specifications, which electrical signals are directly capable and
intended to be used for sound reproduction through amplifiers and
loudspeakers.
1.15 CD-ROM Player - a Player which is designed and manufactured solely for the
reproduction of information
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stored on a CD-ROM Disc and conversion of such information, which is
bit-encoded according to the CD-ROM Standard Specifications, into
electrical signals by means prescribed in the CD-ROM-Standard
Specifications, which electrical signals are directly capable and intended
to be used for reproduction of computer-related-data through data handling
and/or data processing apparatus.
1.16 CD-i Player - a Player which is designed and manufactured solely for the
reproduction of any kind of information stored on a CD-i Disc and as
defined in the CD-i Standard Specifications, and conversion of such
information, which is bit-encoded according to said CD-i Standard
Specifications, into electrical signals by means as prescribed in the CD-i
Standard Specifications, which electrical signals are directly capable and
intended to be used for reproduction of such information.
1.17 CDV-Player - a Player which is designed and manufactured solely for the
reproduction of information stored on a CDV-Disc and conversion of such
information, which is encoded according to the CDV-Standard Specifications,
into electrical signals by means as prescribed in the CDV-
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Standard Specifications, which electrical signals are directly capable and
intended to be used for visual reproduction through standard television
receivers and/or standard television monitors.
1.18 Enhanced Music CD-Player - a Player which is designed and manufactured
solely for the reproduction of information stored on an Enhanced Music CD
Disc and conversion of such information, which is bit-encoded according to
the Enhanced Music CD Standard Specifications, into electrical signals by
means as prescribed in the Enhanced Music CD Standard Specifications, which
electrical signals are directly capable and intended to be used for the
reproduction of audio, video, text and data related information through
data handling and/or data processing apparatus.
1.19 Combi-Player - a Player which is any combination of a CD-Audio Player, a
CD-ROM Player, a CD-i Player, a CDV-Player and an Enhanced Music CD Player.
1.20 Licensed Product - any CD-Audio Disc, CD-ROM Disc, CD-i Disc, CDV-Disc or
Enhanced Music CD Disc.
1.21 Licensed Patents - shall mean the patent rights listed in
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accordance with one of the following license options to be selected by the
Licensee:
(circle type of Licensed Product and Exhibit list of patents on each option
chosen, whether A or B, for each type of Disc)
I. Option A: Licensee, at its option, chooses from one or more of the U.S.
Patents listed on Exhibit I (CD-Audio Disc), Exhibit III (CD-ROM Disc),
Exhibit V (CD-i Disc), Exhibit VII (CDV Disc), and/or Exhibit IX (Enhanced
Music CD), and defined herein as Licensed Patents;
OR
II. Option B: Licensee chooses, at its option, all of the U.S. Patents
listed on Exhibit II (CD-Audio Disc), Exhibit IV (CD-ROM Disc), Exhibit VI
(CD-i Disc), Exhibit VIII (CDV Disc), and/or Exhibit X (Enhanced Music CD
Disc), and defined herein as Licensed Patents.
By __________________________ Date ______________
1.22 Associated Company - any corporation or other legal entity, in which a
party hereto, Philips Electronics North America Corporation, Philips
Electronics, N.V. (PENV) of the Netherlands or Sony Corporation of Japan,
now or
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hereafter controls, directly or indirectly, more than fifty percent (50%)
of the shares entitled to vote for the election of directors or persons
performing similar functions, but any such company or other legal entity
shall be deemed an Associated Company only for as long as such control
exists.
1.23 Territory - United States of America, its territories and possessions
Article II - LICENSES
Subject to the terms and conditions of this Agreement:
2.01 USPC hereby grants to Licensee and its Associated Companies a
non-exclusive, non-transferable license under Licensed Patents to make, use
and sell or otherwise dispose of Licensed Products in the Territory, but
not to have Licensed Products made for it by third parties except as
provided in Article IV.
2.02 USPC and Sony further agree for a period of ten (10) years from the date of
this Agreement, to grant Licensee and its Associated Companies a
non-exclusive, non-transferable license on reasonable, non-discriminatory
terms comparable to those set forth herein, to make, use, sell or otherwise
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dispose of Licensed Products in the Territory, under any patent rights not
yet licensed hereunder which are essential to the manufacturing, use or
sale of Licensed Products, as to which, and to the extent to which, USPC or
Sony, have, or may hereafter acquire, the free right to grant licenses to
Licensee and its Associated Companies and which patent rights were first
filed in any country of the world after December 31, 1982. It is expressly
understood that in respect of the patent rights to be licensed pursuant to
this paragraph 2.02 of Article II, paragraph 5.02 of Article V will not be
applicable and that royalties payable may have to be paid over and above
the royalties due on the basis of the use of Licensed Patents pursuant to
paragraph 2.01 of this Article II.
2.03 Finally, USPC and Sony agree for a period of ten (10) years from the date
of this Agreement to grant Licensee and its Associated Companies upon their
request and on reasonable, non-discriminating royalty rates and conditions
to be agreed upon from case to case, a non exclusive, non-transferable
license to make, use, sell or otherwise dispose of CD-Audio Players, CD-ROM
Players, CD-
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i Players, CDV-Players and Combi-Players in the Territory, under any or all
present and future patent rights essential to the manufacture, use or sale
of such Players, as to which, and to the extent to which, USPC or Sony may
now have, or may hereafter acquire, the free right to grant licenses to
Licensee and its Associated Companies for the manufacture, use and sale of
such Players. It is expressly understood that paragraphs 5.01 and 5.02 of
Article V shall not in any way be applicable to licenses pursuant to this
paragraph 2.03 of Article II.
2.04 In consideration of the undertakings set forth in paragraphs 2.01, 2.02 and
2.03 and similar undertakings by third party licensees of USPC or PENV, for
a period of ten (10) years from the effective date of this Agreement,
Licensee, agrees to grant to USPC, Philips Electronics North America
Corporation, PENV, Sony Corporation of Japan and their respective
Associated Companies, and to other third parties who have similarly
entered, or will enter, into a license agreement with USPC, PENV or an
Associated Company thereof concerning Licensed Products and who have
elected to accept or will accept a similar undertaking as
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contained in this paragraph 2.04, on reasonable, nondiscriminating
conditions comparable to those set forth herein, non-exclusive,
non-transferable licenses to manufacture, use, sell or otherwise dispose of
Licensed Products under any or all present and future patent rights which
are essential to the manufacturing, use or sale of Licensed Product, as to
which, and to the extent to which, Licensee or its Associated Companies may
now have or may hereafter acquire the right to grant licenses.
2.05 In consideration of the undertakings set forth in paragraphs 2.01, 2.02 and
2.03 and similar undertakings by third party licensees of USPC or PENV, for
a period of ten (10) years from the effective date of this Agreement,
Licensee agrees to grant to USPC, Philips Electronics North America
Corporation, PENV, Sony Corporation of Japan and their respective
Associated Companies, and to other third parties who have entered or will
enter into a license agreement with USPC, PENV or an Associated Company
thereof concerning Players and who have accepted or will accept a similar
undertaking as contained in this paragraph 2.05, on reasonable,
non-discriminating
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conditions to be agreed upon from case to case, nonexclusive,
non-transferable licenses to manufacture, use, sell or otherwise dispose of
CD-Audio, CD-ROM, CD-i, CDV, Enhanced Music CD and/or Combi-Players under
any or all present and future patent rights which are essential to the
manufacture, use or sale of such Player, as to which, and to the extent to
which, Licensee or its Associated Companies may now have or may hereafter
acquire the right to grant licenses.
2.06 To the extent a dispute exists between USPC, Licensee and/or Sony regarding
whether any patent is "essential" or whether any license offered by
Licensee, USPC, or Sony pursuant to this Article II is under "reasonable...
conditions" as those words are used in this Article II then USPC, Sony
and/or licensee shall submit such dispute to binding arbitration under the
1992 Patent Arbitration Rules of the American Arbitration Association
("AAA"). Such arbitration shall be held before a panel of three arbitrators
and shall take place in New York, New York. Licensee, USPC and/or Sony each
shall choose one arbitrator who shall be unaffiliated with the parties and
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who shall have been a member of the bar of the United States Court of
Appeals for the Federal Circuit for at least the preceding five years. The
two arbitrators chosen by USPC, Licensee and/or Sony shall then choose a
third arbitrator who shall also have been a member of the bar of the
Federal Circuit for at least the preceding five years and who shall serve
as chairperson of the panel. If the arbitrators chosen by USPC, Licensee
and/or Sony are unable to agree on a chairperson of the panel within sixty
days of their designation by USPC, Licensee and/or Sony then such third
arbitrator shall be chosen in accord with the rules of the AAA. All other
disputes regarding or relating to this License Agreement other than those
specified in this paragraph shall not be subject to arbitration.
IT IS EXPRESSLY UNDERSTOOD THAT
(I) THE LICENSES AND LICENSE UNDERTAKINGS WITH REGARD TO THE MANUFACTURE OF
LICENSED PRODUCTS DO NOT REFER TO RECORDING MACHINES, OR APPARATUS OR
METHODS FOR THE MULTIPLICATION OF DISCS, OR APPARATUS OR METHODS FOR THE
MANUFACTURE OF MATERIALS; NOR DO THE LICENSE UNDERTAKINGS WITH REGARD TO
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THE MANUFACTURE OF PLAYERS EXTEND TO THE MANUFACTURE OF COMPONENTS OF
PLAYERS SUCH AS, BUT NOT LIMITED TO SEMICONDUCTOR DEVICES, INTEGRATED
CIRCUITS, LASERS, MOTORS AND LENSES, EXCEPT FOR PATENT RIGHTS PERTAINING TO
CIRCUITRY AND/OR SYSTEM ASPECTS SPECIFIC TO THE CD-SYSTEMS (AND SIMILAR
TYPE OPTICAL READ-OUT SYSTEMS), AND
(II) THE RIGHTS AND LICENSES GRANTED PURSUANT TO THIS AGREEMENT DO NOT EXTEND TO
ANY COMBINATION OF ONE OR MORE LICENSED PRODUCTS WITH ANY OTHER ITEMS,
PRODUCTS, SYSTEMS, STRUCTURES, APPARATUS OR SOFTWARE.
Article III - STANDARD SPECIFICATIONS,
TECHNICAL INFORMATION AND SUPPORT
3.01 Upon execution of this Agreement and receipt of the payment provided in
paragraph 5.01 of Article V, USPC shall make available to Licensee for use
by Licensee and its Associated Companies a copy of then current version of
the respective Standard Specifications, together with such information as
is in USPC's reasonable opinion is required for the interpretation of such
then current Standard Specifications.
3.02 If USPC in its reasonable opinion determines
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that an addition or modification to any of the Standard Specifications
should be made, Licensee shall be so notified in writing and be furnished
with information to assist Licensee in the interpretation of such addition
and/or modification.
3.03 Insofar as USPC has a free and legal right to do so, USPC further agrees to
make available to Licensee upon Licensee's request and for use by Licensee
and its Associated Companies in accordance with the terms of this
Agreement, such other information, data and material as are, in USPC's
reasonable opinion, strictly required to manufacture Licensed Products,
which are interchangeable with Licensed Products made and/or sold by
Philips.
Article IV - HAVE MADE
The licenses and rights granted to Licensee and its Associated Companies
pursuant to Article II and the right to use the information pursuant to Article
III, include the right for Licensee and its Associated Companies to have third
parties manufacture for Licensee's or its Associated Companies' use and account
with due regard to what has been provided hereinbefore, such Licensed Products
as Licensee and/or its Associated
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Companies require in and for their sale of Licensed Products, provided that such
third parties agree to use the information obtained by Licensee pursuant to
Article III only for the manufacture of Licensed Products ordered by Licensee
and its Associated Companies and also agree to observe the secrecy obligations
accepted by Licensee hereunder. As and when the information supplied by USPC to
Licensee pursuant to Article III is supplied by Licensee or an Associated
Company of Licensee to a third party supplier to have such third party supplier
manufacture Licensed Products for Licensee and/or its Associated Companies,
Licensee will notify USPC of the name of such third party supplier and of the
fact that such third party supplier has agreed in writing to the restrictions on
the use of the USPC supplied information to be observed by it.
Article V - ROYALTIES, REPORTS AND PAYMENTS
5.01 Upon execution of this Agreement, Licensee will make a non-refundable
payment of twenty five thousand ($25,000) US dollars to USPC. Said payment
of twenty five thousand dollars shall not be credited against royalties
payable hereunder pursuant to paragraph 5.02 of this Article V.
5.02 (A) In the case where Licensee has chosen Option A to
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define Licensed Patents - In consideration of the patent licenses granted
hereunder by USPC to Licensee, Licensee agrees to pay to USPC royalties as
follows:
(a) seven point five U.S. cents ($0.075) for each CDV Disc with an
outer diameter greater than 130mm;
(b) two U.S. cents ($0.02) for each CD-Audio Disc with an outer
diameter smaller than 90mm; and
(c) four point five US cents ($0.045) for:
-each CD-i Disc;
-each Enhanced Music CD Disc;
-each CDV Disc with an outer diameter equal to, or smaller than
130 mm; and
-each CD-Audio Disc with an outer diameter equal to, or greater
than, 90mm;
which is made, used, sold or otherwise disposed of by Licensee or an Associated
Company of Licensee, and in which a Licensed Patent is utilized.
5.02(B) In the case where Licensee has chosen Option B to define Licensed
Patents - In consideration of the patent licenses granted hereunder by USPC
to Licensee, Licensee agrees
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to pay to USPC royalties as follows:
(a) eight U.S. cents ($0.08) for each CDV Disc with an outer diameter
greater than 130mm;
(b) two point two U.S. cents ($0.022) for each CD-Audio Disc with an
outer diameter smaller than 90mm; and
(c) four point eight US cents ($0.048) for:
-each CD-ROM Disc;
-each CD-i Disc;
-each Enhanced Music CD Disc;
-each CDV Disc with an outer diameter equal to, or smaller than,
130mm; and
-each CD-Audio Disc with an outer diameter equal to, or greater
than, 90mm;
which is made, used, sold or otherwise disposed of by Licensee or an Associated
Company of Licensee, and in which a Licensed Patent is utilized.
5.03 A Licensed Product shall be considered sold when invoiced, or if not
invoiced, when delivered to a party other than the manufacturer.
5.04 Within thirty (30) days after the 31st March, the 30th June, the 30th
September and the 31st December of each
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year during the period this Agreement shall be in force and effect,
Licensee shall submit to USPC, even if there are no sales, a statement in
writing, duly certified by an officer of the Licensee, setting forth with
respect to the preceding quarterly period:
(i) The quantities of Licensed Products sold by Licensee and its
Associated Companies, specifying the quantities for each of the
following individual type of Licensed Products:
(a) CD-Audio Discs with an outer diameter smaller than 90 mm;
(b) CD-Audio Discs with an outer diameter greater than 90 mm;
(c) CDV Discs with an outer diameter greater than 130 mm;
(d) CDV Discs with an outer diameter smaller than 130 mm;
(e) CD-ROM Discs;
(f) CD-i Discs;
(g) Enhanced Music CD Discs; and
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(ii) the royalty payable to USPC as calculated under the terms of this
Agreement.
Licensee shall pay to USPC the royalty due hereunder in U.S. dollars
concurrently with submission of the above mentioned statement.
5.05 Royalties shall be due and payable on all Licensed Products manufactured
prior to, but remaining in stock with Licensee and its Associated Companies
at the date of expiration or termination of this Agreement. Certified
reports on the number of Licensed Products in stock at the time of
expiration or termination of this Agreement shall be submitted to USPC
within thirty (30) days after such expiration or termination. For the
purpose of royalty computation it shall be assumed that all Licensed
Products in stock will be sold, leased or otherwise disposed of in the same
countries and in proportionally the same quantities as in the last full six
(6) months period reported on during the term of this Agreement. Payment of
royalties due shall be effected concurrently with the submission of said
certified report.
5.06 All payments which are not made on the dates specified
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herein, shall accrue interest at the rate of two percent (2%) per month or
the maximum permitted by applicable law, whichever is less.
5.07 All costs, such as stamp duties, taxes and other similar levies originating
from or in connection with the conclusion of this Agreement shall be borne
by Licensee. However, in the event that the government of a country imposes
any income taxes on payments hereunder by Licensee to USPC and requires
Licensee to withhold such tax from such payments, Licensee may deduct such
tax from such payments. In such event, Licensee shall promptly furnish USPC
with tax receipts issued by appropriate tax authorities so as to enable
USPC to support a claim for credit against income taxes which may be
payable by USPC and/or its Associated Companies in the Netherlands.
5.08 In order that the royalties and reports provided for in this Article V may
be verified, Licensee agrees to ensure that full, complete and accurate
books and records shall be kept covering all sales or other disposal of
Licensed Products by Licensee and/or its Associated Companies, for a period
of three (3) years following such sales or other
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dispositions. It is agreed that the books and records of Licensee and/or
its Associated Companies may be audited from time to time, but not more
than once in each calendar year, by an independent certified public
accountant appointed by USPC and reasonably acceptable to Licensee, to the
extent necessary to verify the accuracy of the aforementioned statements
and payments. Such inspection shall be completed at USPC's own expense
provided that if any discrepancy or error exceeding three percent (3%) of
the money actually due is found in connection with the computation, the
cost of such inspection shall be borne by Licensee.
5.09 Notwithstanding the provisions of paragraph 5.08 of this Article V,
Licensee shall furnish whatever additional information as USPC may
reasonably request from time to time to enable USPC to ascertain which
products sold, leased or put into use by Licensee and/or its Associated
Companies are subject to the payment of royalties to USPC hereunder, the
patent rights which have been utilized in connection with such products,
and the amount of royalties payable.
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Article VI - MOST FAVORABLE CONDITIONS
If under otherwise substantially the same conditions as contained in this
Agreement, licenses under the patent rights referred to and licensed pursuant to
Article II should be granted for Licensed Products to any third party at a
royalty rate more favorable than the rate payable by Licensee under this
Agreement, Licensee shall be entitled to have the royalty rate applicable to it
modified to such extent that the same shall be as favorable as that available to
such third party, provided always that such obligation shall not apply in
respect of cross-license agreements and other agreements, in which the
consideration for such licenses shall not be wholly expressed in payment of
royalties and shall also not apply to licenses or other arrangements made
pursuant to a court decision or a settlement of a dispute between USPC and a
Licensee or between USPC and a third party. Without limiting the foregoing, this
Article VI shall not apply to terms entered into in settlement of a filed court
action regardless of the nature of such action or settlement terms.
Article VII - DISCLAIMER
USPC warrants that it shall furnish the information to be
26
suppled by it to the best of its ability, but it makes no representation or
warranty as to the value of the information transmitted or the ability of
Licensee to make use thereof to secure interchangability. USPC makes no warranty
whatsoever that the use of information supplied by USPC does not infringe or may
not cause infringement of patent rights owned or controlled by third parties, or
of patent rights owned or controlled by USPC or an Associated Company of USPC
not licensed pursuant to Article II.
In further certainty the parties of this agreement recognize that third
parties owned patent rights in the field of Licensed Products and Licensee
excepts that USPC makes no warranty whatsoever that any manufacture, use, sale,
lease or other disposition of Licensed Product will be free from infringement of
any patent other than Licensed Patents.
Article VIII - SECRECY
Licensee agrees that, subject to what has been provided for in Article IV
of this Agreement, Licensee and its Associated Companies shall not disclose to
any third party information relative to the manufacture and sale of Licensed
Products acquired from USPC or USPC's Associated Companies.
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This obligation, which shall run for the period of this Agreement and for a
period of three (3) years thereafter, shall not apply to the extent information
so acquired:
(a) was known to Licensee or its Associated Companies prior to the date said
information was acquired from USPC or its Associated Companies, as shown by
records of Licensee or any Associated Company of Licensee or otherwise
demonstrated to Philips' satisfaction;
(b) is or has become available to the public in general through no fault of
Licensee or its Associated Companies;
(c) was or is received from a third party who was free and had a legal right to
disclose the same.
In protecting information acquired from USPC or their Associated Companies
pertaining to Licensed Products, Licensee has agreed that Licensee and its
Associated Companies will take all necessary measures and precautions,
including, but not limited to, measures requiring their present and future
employees to give suitable undertakings of secrecy both for the period of their
employment and thereafter, and that in general such information will be treated
in the same manner and with the same degree of care as Licensee applies and has
applied to
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its own information of a sensitive or confidential nature.
Article IX - PATENT MARKINGS AND LOGO
9.01 If requested by USPC, Licensee shall place appropriate patent markings on
an exposed surface of the Licensed Products made, used, sold and/or
otherwise disposed of hereunder. The content, form, location and language
used in such markings shall be in accordance with the laws and practices of
the country, where such markings are used.
9.02 In addition, Licensed Products may be provided with respective logos in
accordance with the instructions laid down in the CD Logo Guide which is
available from USPC on request (hereinafter referred to as "the Logo"). In
advertisements and sales literature with respect to Licensed Products sold
by Licensee and/or its Associated Companies the Logo may similarly be used
and applied.
9.03 USPC grants Licensee and its Associated Companies a royalty free,
non-exclusive, non-transferable, indivisible right to use the Logo on and
with respect to Licensed Products manufactured by or for Licensee and/or
its Associated Companies in accordance with the instructions laid down in
Exhibit AA.
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9.04 Licensee understands and agrees that USPC makes no warranty whatsoever that
any use of the Logo will be free from infringement of intellectual property
rights owned by third parties.
Article X - ASSIGNMENT
This Agreement shall inure to the benefit of and be binding upon each of
the parties hereto and their respective assigns. It may not be assigned in whole
or in part by Licensee without the prior consent in writing of USPC except to
the surviving corporation of a merger, consolidation or other transfer of all or
substantially all the assets of Licensee and except that Licensee may assign
this Agreement to one of its Associated Companies provided that Licensee remains
liable hereunder and the transferee has the capability to perform all
obligations to be performed hereunder.
Article XI - TERM AND TERMINATION
11.01 This Agreement shall be effective from the date first written above, if
and unless otherwise terminated shall remain in force for a period of ten
(10) years from the effective date of this Agreement. Notwithstanding the
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foregoing, this Agreement shall expire on the expiration date of the last
to expire of the Licensed Patents licensed and referred to in Article II.
11.02 Either party may terminate this Agreement at any time on thirty (30) days
notice to the other party in the event that the latter shall fail to
perform any obligation under this Agreement and such default is not
remedied within thirty (30) days after receipt of a notice specifying the
nature of the default. Such right of termination shall not be exclusive of
any other remedies or means of redress to which the non-defaulting party
may be lawfully entitled, it being intended that all such remedies shall
be cumulative. Any such termination shall not affect any payments, the
rights to which may have fallen due under this Agreement prior to such
termination. Notwithstanding anything to the contrary herein, USPC shall
have the right, at its sole option and discretion, to terminate this
Agreement without advance notice (but with written notice) in the event
that Licensee shall fail to abide by the obligations as set forth in
Article V hereof for three (3) consecutive quarters.
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11.03 The obligations set forth in paragraphs 2.02, 2.03, 2.04, 2.05, 5.05,
12.05 and Article VIII shall survive termination of this Agreement.
Notwithstanding the foregoing, in the event termination is due to the
breach of the Agreement by Licensee, paragraphs 2.02 and 2.03 shall not
survive termination.
11.04 If Licensee should be dissolved or file a voluntary petition in bankruptcy
or seek any court or governmental protection from creditors or make any
assignment for creditors, or should an order be entered pursuant to any
law relating to bankruptcy or insolvency appointing a receiver or trustee
for Licensee, and if any such receivership is not terminated within sixty
(60) days, then, in any of the events specified in this paragraph 11.04,
USPC may give written notice to Licensee terminating this Agreement and
this Agreement shall be terminated in accordance with the notice.
Article XII - MISCELLANEOUS
12.01 This Agreement sets forth the entire agreement and understanding between
the parties as to the subject matter hereof and merges all prior
discussions between them and
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neither of the parties shall be bound by any conditions, definitions,
warranties, waivers, releases or representations (either expressed or
implied) with respect to the subject matter of this Agreement, other than
expressly provided for herein, or as duly set forth on or subsequent to
the date hereof in writing signed by a duly authorized representative of
the party to be bound thereby.
12.02 Nothing contained in this Agreement shall be construed:
(a) as imposing on either party any obligation to institute any suit or
action for infringement of any of the patent rights licensed
hereunder or to defend any suit or action brought by a third party
which challenges or concerns the validity of any of such patent
rights, it being expressly understood that Licensee shall have no
right to institute any such suit or action for infringement of any
of the patent rights licensed by USPC hereunder, nor the right to
defend any such suit or action which challenges or concerns the
validity of any such USPC patent right;
(b) as imposing any obligation to file any patent
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application or to secure any patent or to maintain any patent in
force;
(c) as conferring any license or right to copy or to simulate the
appearance and/or design of any product of USPC or its Associated
Companies;
(d) as conferring any license under the patent rights licensed pursuant
to Article II hereof to manufacture, use, sell, lease or otherwise
dispose of any product or device other than a Licensed Product.
12.03 If at any time a party shall elect not to assert its rights under any
provision of this Agreement, such action or lack of action in that respect
shall not be construed as a waiver of its rights under said provision or
of any other provision of this Agreement.
12.04 Any notice or request required or permitted to be given under or in
connection with this Agreement or the subject matter hereof shall be in
writing and shall be deemed to have been sufficiently given when, if given
to Licensee,
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it is addressed to:
Hauppauge record Manufacturing
00 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
and in respect to USPC, to:
Intellectual Property Department
U.S. Philips Corporation
000 Xxxxx Xxxxxx Xxxx,
Xxxxxxxxx, Xxx Xxxx 00000
and sent in each case by telecopy and Registered Mail, postage prepaid.
The date of mailing shall be deemed to be the date on which such notice of
request has been given. Either party may give written notice of change of
address and, after notice of such change has been received, any notice or
request required to be given shall thereafter be given to such party at
such changed address in the manner as provided above.
12.05 This Agreement and all disputes, claims or controversies arising out of,
or in any way relating to, this Agreement ("Dispute") shall be governed by
and construed, and any claim or controversy arising with respect thereto
shall be determined, in accordance with the laws and in the competent
courts of the State of New York. The parties
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hereto consent to the personal jurisdiction of the competent courts of the
State of New York for the purpose of prosecuting or resolving any such
Dispute.
IN WITNESS WHEREOF, the parties hereof have caused this Agreement to be
signed on the date first above written.
U.S. PHILIPS CORPORATION HAUPPAUGE RECORD MANUFACTURING
By /s/ [ILLEGIBLE] By /s/ [ILLEGIBLE]
--------------------------- --------------------------------
Title Vice President Title VP
------------------------ -----------------------------
Date 4/1/96 Date 2/29/29
------------------------ -----------------------------
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