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EXHIBIT 10.4
SETTLEMENT AGREEMENT AND MUTUAL RELEASE
This SETTLEMENT AGREEMENT AND MUTUAL RELEASE (this "Release") is entered
into as of March 24, 1999 by and between ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, a Delaware
corporation, and QUALCOMM Personal Electronics, a California partnership
(collectively, "QUALCOMM"), on the one hand, and Telefonaktiebolaget LM
Ericsson (publ), a Swedish corporation, and Ericsson Inc., a Delaware
corporation (collectively, "Ericcson"), on the other hand.
RECITALS
A. QUALCOMM and Ericsson are parties in the civil action entitled
"Ericsson Inc. et al. v. QUALCOMM Inc. et al.," Civil Action No.
2:96cv183-DF/HWM (Consolidated), in the United States District Court for the
Eastern District of Texas, Marshall Division, as well as the civil action
untitled "OKI America, Inc. v. Telefonaktiebolaget LM Ericsson, Sweden and
Ericsson Inc.," No. C-96 20747 RMW (EAI), in the United States District Court
for the Northern District of California, San ▇▇▇▇ Division (together, the
"Litigation"), and by entering into this Release agree to stay and ultimately
to settle and dismiss their respective claims in the Litigation and to release
all existing claims relating thereto, subject to the terms and conditions
hereof;
B. Simultaneously with the execution and delivery of this Release,
QUALCOMM and Ericsson have entered into an Asset Purchase Agreement (the "Asset
Purchase Agreement") pursuant to which Ericsson has agreed to purchase and
QUALCOMM has agreed to sell substantially all the assets and liabilities of
QUALCOMM's infrastructure business (the "Acquired Business"), subject to
the terms and conditions thereof; and
C. Also simultaneously with the execution and delivery of this Release,
in connection with the settlement of the Litigation and the purchase and sale
of the Acquired Business, QUALCOMM and Ericsson have entered into a
Multi-Product License Agreement and a Subscriber Unit License Agreement (the
"License Agreements") pursuant to which each party has agreed to grant the
other party a license under the specific patents identified in the License
Agreements and such other patents as may be designated under the terms of the
License Agreements for use in CDMA applications, including but not limited to,
in cdmaone (including 1S-95, ▇▇-▇▇▇, ▇▇-▇▇▇, ▇▇▇▇ ▇-▇▇▇-▇▇▇ and Q-CDMA),
cdma2000 and W-CDMA, contingent upon the Closing of the purchase and sale of
the Acquired Business pursuant to the Asset Purchase Agreement.
NOW, THEREFORE, in consideration of the License Agreements, the receipt
and sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
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1. Stay. Upon the execution of this Release, Ericsson and QUALCOMM agree
to stay the Litigation for a period of four months, and shall jointly move for
an immediate stay of all proceedings and of all pending decisions by each court
in the Litigation for such period. The parties agree that in the event of any
termination of the Asset Purchase Agreement prior to the end of such period,
the stay shall be lifted, and the parties shall jointly move therefor.
2. Dismissal. Upon the Closing (as defined in the Asset Purchase
Agreement) of the purchase and sale of the Acquired Business pursuant to the
Asset Purchase Agreement, Ericsson and QUALCOMM shall dismiss with prejudice
all of their respective claims and counterclaims against each other in the
Litigation, each party to bear its own costs (and attorneys' fees) related to
the Litigation. Upon the closing of the Asset Purchase Agreement, each party
shall promptly file in the Litigation all pleadings and papers necessary to
accomplish such dismissal. The parties agree that any subsequent claims or
actions filed by either party arising out of any claim or cause of action that
is the subject of this Release will also be subject to dismissal with prejudice.
3. No Admission. The parties hereby expressly agree and acknowledge
that, by entering into and performing this Release, neither of them admits any
liability or wrongdoing or the truth of any allegation contained in any claim,
defense, or counterclaim alleged in the Litigation. Neither this Release nor
any action taken to carry out this Release may be construed or used as an
admission of any issues, facts, wrongdoing, liability, or violation of law
whatsoever.
4. General Mutual Release. Upon the Closing of the purchase and sale of
the Acquired Business pursuant to the Asset Purchase Agreement, in
consideration of the covenants and agreements contained herein and in the
License Agreements, and on behalf of their officers, directors, shareholders,
affiliates, successors, heirs, executors, administrators, and assigns, QUALCOMM
hereby fully and forever releases and discharges Ericsson, and Ericsson hereby
fully and forever releases and discharges QUALCOMM, from any and all claims,
demands, liabilities, commissions, payments, obligations, responsibilities,
suits, actions and causes of action, whether liquidated or unliquidated, fixed
or contingent, known or unknown, which the releasing party or any of its
present Affiliates (as defined below) may have on account of any act or
omission as of the Closing Date (as defined in the Asset Purchase Agreement)
arising out of or relating to the Litigation and the termination thereof.
"Affiliates" of any party means all other persons or entities controlling,
controlled by or under common control with, such specified party.
5. Waiver. All rights under Section 1542 of the Civil Code of the State
of California, and under any and all similar laws of any governmental entity,
are hereby expressly waived. Each party is aware that said Section 1542 of the
Civil Code of the State of California provides as follows:
"A general release does not extend to claims which the creditor
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does not know or suspect to exist in his favor at the time of
executing the release, which if known by him must have materially
affected his settlement with the debtor."
6. Representations. Each party hereby represents and warrants to the
other that (a) it is duly and fully authorized to enter into this Release, that
this Release has been duly authorized, executed and delivered by it and that
this Release is enforceable against it in accordance with its terms, (b) it is
executing this Release after consultation with its own independent legal counsel
and (c) it has not heretofore assigned or transferred to any person or entity
any right, title or interest in any of the claims asserted in the litigation or
in the matters that it purports to release herein.
7. Entire Agreement; Governing Law. This Release, the License Agreements
and the Asset Purchase Agreement form the entire agreement between the parties
concerning the subject matter hereof. There are no other existing agreements or
understandings between the parties hereto relating to the settlement and release
provided for in this Release. All prior agreements, promises or negotiations
between the parties are merged into this Release and the License Agreements and
Asset Purchase Agreement. This Release shall be governed by and construed in
accordance with the law of the State of New York.
8. Termination. This Release shall terminate automatically and without
any action on the part of any party hereto in the event of any termination of
the Asset Purchase Agreement.
9. Successors, Assigns and Beneficiaries. This Release shall inure to the
benefit of and shall be binding upon the parties hereto and their respective
successors, assigns, representatives, beneficiaries and attorneys.
10. Counterparts. This Release may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument.
11. Further Acts. Each party to this Release agrees to perform any and all
further acts and execute and deliver any and all further documents that may be
reasonably necessary to carry out the provisions of this Release.
12. Waiver and Amendments. No waiver of any provision of this Release
shall be deemed a waiver of any other provision. Any amendment to this Release
shall be in writing and signed by both parties.
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IN WITNESS WHEREOF, the parties hereto have executed this Release through
their duly authorized representatives, as of the date first set forth above.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
By /s/ [Signature Illegible]
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Name:
Title:
QUALCOMM PERSONAL ELECTRONICS
By ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, its general partner
By /s/ [Signature Illegible]
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Name:
Title:
TELEFONAKTIEBOLAGET LM ERICSSON(publ)
By /s/ [Signature Illegible]
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Name:
Title:
By /s/ [Signature Illegible]
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Name:
Title:
ERICSSON INC
By /s/ [Signature Illegible]
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Name:
Title:
