DIGITAL VERSATILE DISC PLAYER / DIGITAL VIDEO CASSETTE RECORDER
LICENSE AGREEMENT FOR ANTICOPY TECHNOLOGY
This DVD/DVCR LICENSE AGREEMENT is made as of the 18th day of February, 1997 by
and between MACROVISION CORPORATION, a California corporation, having its
principal place of business at 1341 Orleans Drive, Sunnyvale, California 94089,
Facsimile (408) 743-8610 and VICTOR COMPANY OF JAPAN, LIMITED, a Japanese
corporation, having its principal place of business at 12, 3-chome, Moriya-cho,
Kanagawa-ku, Yokohama, Kanagawa 221, Japan, Facsimile 011-81-3-45-450-2426.
RECITALS
A. Macrovision is the owner of all right, title and interest in and to certain
anticopying technology which may be used to protect video material against
unauthorized analog copying in connection with Digital Video Disc or
Digital Video Cassette Recorder program playback.
B. Licensee desires to incorporate the Macrovision anticopy technology
components into Products.
AGREEMENT
NOW THEREFORE, in consideration of the mutual covenants set forth below, the
parties agree as follows:
1. DEFINITIONS
In this Agreement,
1.1 "ADAPTIVE CONTROL" means the ability to switch between the primary
configuration of the Process and one or more secondary configurations
of the Process on a real-time basis in accordance with the status of
control bits read from the media;
1.2 "AGC SYSTEM" means a system of modifying a video signal so as to
inhibit the making of Playable video recordings therefrom. This
modification includes adding a combination of either a pseudo sync or
a regular sync pulse with an AGC pulse. These pairs of sync and AGC
pulses are designed to cause the AGC circuitry in a Recording Device
to miscalculate the proper gain setting and thereby render copy
protection performance Effective;
1.3 "AGREEMENT" means this agreement and all attachments hereto;
1.4 "APPARATUS" means apparatus for implementing the Process within a
Product;
1.5 "AUTHORIZED COMPONENT SUPPLIER" means a Macrovision authorized
supplier of manufactured Devices;
1.6 "CLAIMS" means claims 14-20 of U.S. Patent No. 4,631,603; claims 8-14
of U.S. Patent No. 4,577,216; claims 9-13 of U.S. Patent No.
4,819,098; claims 18-29, 32, 33, 44-52 of U.S. Patent No. 4,907,093;
and foreign counterpart patent claims claiming the priority date of or
disclosing and claiming the same inventions as recited in the above
enumerated claims relating to the Apparatus and the Licensed
Technology; and other patent claims and foreign counterparts thereof,
existing now or in the future, covering the Apparatus and/or the
Licensed Technology;
1
CONFIDENTIAL
1.7 "COLORSTRIPE" means the modification of a color video signal to
inhibit the making of Playable video recordings thereof. The
resultant color picture from a subsequent video tape recording will
show variations in the color fidelity that appear as bands or stripes
of color error;
1.8 "COPY PROTECTED" means, when referring to a Disc or Digital Cassette,
a Disc or Digital Cassette on which the Trigger Bits have been set to
activate the Process in the Product; and when referring to program
material means that the Process has been applied to the analog output
of the Product;
1.9 "DEVICE" means an Authorized Component Supplier's integrated circuit
which contains the Apparatus;
1.10 "DIGITAL CASSETTE" means a prerecorded digital video cassette which
incorporates the Trigger Bits to activate or control part or all of
the Process;
1.11 "DISC" means a prerecorded digital video disc/digital versatile disc
which incorporates the Trigger Bits to activate or control part or all
of the Process;
1.12 "DISPLAY DEVICE" means consumer-type television sets, TV-VCR
Combinations which display an analog NTSC, PAL or YC signal, and all
other devices which display NTSC, PAL or YC video signals from
Products, which Licensee or its Subsidiaries or affiliates
manufactures or sells;
1.13 "DVCR TECHNOLOGY" means the technology used in the design, development
and/or manufacture of digital video cassette recorders utilizing
industry standard specifications. Such recorders will reproduce
real-time recordings as well as play back Digital Cassettes. Such
recorders do not include digital recorders that record on a
less-than-real time basis for later playback. For the purposes of
this Agreement, "less-than-real-time" means any application in which a
video program is transmitted to an end user in significantly less time
than the program's normal running time, and is recorded as received on
any suitable medium, for later viewing by the end user;
1.14 "DVD TECHNOLOGY" means the technology used in the design, development
and/or manufacture of Digital Versatile Disc players and/or recorders
utilizing industry standard specifications, independent of the laser
technology, the method of media production and the disc or system
parameters. Such players and/or recorders may utilize industry
standard specifications and will reproduce real-time recordings as
well as playback Discs. Such recorders do not include digital
recorders that record on a less-than-real time basis for later
playback;
1.15 "EFFECTIVE" or "EFFECTIVENESS" or words of similar import means:
1.15.1 for the AGC System, that Recording Devices will react to the
AGC signal such that, when a program has been Copy Protected
with the AGC process, a Recording Device will create copies
of the program which, when played back, display a reduction
in their video signal amplitude of at least 65%. More
specifically, a standard color bar signal containing 100%
peak white, and measuring 1 volt peak-to-peak from sync tip
to peak white, when Copy Protected according to the latest
published AGC process specifications, should be reduced to
350 millivolts or less as measured from sync tip to peak
white, when recorded and played back. [Note that the AGC
pulses cycle in amplitude between zero and 117 IRE units.
The reduction to 350 millivolts peak-to-peak of the recorded
video level should be measured while the AGC pulses are at
maximum level.];
2
CONFIDENTIAL
1.15.2 for Colorstripe, that a Recording Device will be considered
to have met the Effectiveness criteria for Colorstripe, if,
on playing back a Colorstripe-protected video program which
was recorded on the Recording Device used for such play
back, any one or more of the following effects is produced:
1.15.2.1 a complete inversion of the color phase of the chroma
on those lines which began with a Colorstripe-modified
colorburst;
1.15.2.2 a complete loss of chroma on the active portion of
those lines following a Colorstripe-modified
colorburst;
1.15.2.3 a complete or intermittent loss of chroma throughout at
least 50% of the visible image (if intermittent, the
chroma should be missing not less than 50% of the time
in any 10 second interval); or
1.15.2.4 any other form and level of degradation to which
Macrovision in its sole and absolute discretion agrees
in writing;
1.15.3 Licensee may satisfy the requirements for Effectiveness
herein by incorporating into its Recording Devices circuitry
which will detect a modified signal as described in the AGC
System and/or Colorstripe and, upon doing so, stop
recording;
1.16 "EFFECTIVE DATE" means the date or the last of the dates, if
different, on which this Agreement is executed by Macrovision and
Licensee, which Effective Date will be entered in the preamble of this
Agreement;
1.17 "LICENSED TECHNOLOGY" means the Claims and the technology (including
the intellectual property embodied therein) specified in Attachments
1A, 1B, 2 and 3 which is used in the design, development and/or
manufacture of Products which will allow application of the Process to
the analog output of a Player or a Recorder and which will allow
detection of the analog copy protection signal on the analog input of
a Recorder, and all enhancements thereto which Macrovision chooses to
make available to its licensees, but expressly excludes the technology
used for activation of the Adaptive Control of the Process;
1.18 "LICENSEE" means Victor Company of Japan, Limited and its
Subsidiaries;
1.19 "MACROVISION" means Macrovision Corporation;
1.20 "PLAYABLE" and "PLAYABILITY" means the characteristic of not
displaying materially degraded pictures from signals containing the
Process, including color bars and active program material. The ideal
playability requirement for an anticopy process requires that a
skilled observer, viewing a variety of typical and worst case images
on a large representative sampling of TV models in use, should be
unable to determine whether copy protection is turned on or not. In
this context, worst case images are those most likely to produce
visible artifacts for the particular copy protection system in
question. For the purposes of this Agreement, compliance with the
Playability requirements of the Agreement will be determined largely
by objective measurement criteria, but in light of the impossibility
of including every possible situation under an objective measurement
umbrella, Licensee is required to adhere to a subjective indicator of
playability also. The subjective indicator, from which the objective
measurements are derived, is as follows: the TV model in question,
when displaying copy protected
3
CONFIDENTIAL
images, should not produce any artifacts AS A RESULT OF THE COPY
PROTECTION which could cause critical consumers to complain. Without
limiting the generality of the foregoing, Playability will be deemed
to have been achieved when:
1.20.1 with respect to the AGC System,
1.20.1.1 SKEW ERRORS. The horizontal phase lock loop shall have
recovered from any disturbance caused by the
pseudo-sync pulse component of the AGC process such
that the first active line of each field shall be
offset horizontally by no more than 200 nanoseconds
from its correct position. Subsequent lines shall have
smaller offsets in a smoothly diminishing manner.
Also, the offset error profile on alternate fields
shall differ by no more than 10 percent;
1.20.1.2 CLAMPING ERRORS. The black level clamping circuits
shall have recovered from any disturbance caused by the
pseudo-sync/AGC pulse pairs, such that the blanking
error on the first active line of each field shall be
within 2 IRE unit of its correct value, and subsequent
lines shall have smaller errors in a smoothly
diminishing manner. Also, the error profile on
alternate fields shall differ by no more than 0.5 IRE
units to avoid flicker. This measurement should be
carried out when the AGC pulses are at maximum
amplitude;
1.20.1.3 GAIN ERRORS. The gain of the luminance or chrominance
channels of the TV set shall change by no more than 1%
when the AGC pulses are cycled between maximum and
minimum amplitude;
1.20.1.4 VERTICAL JITTER. Any vertical jitter caused by the
interaction of the pseudo-sync pulses and the vertical
sync circuits of the TV set shall be less than 0.05% of
picture height; and
1.20.1.5 RETRACE BLANKING. TV sets should have adequate
blanking to ensure the absence of any visible artifacts
due to the presence of AGC pulses during the retrace
period;
1.20.2 with respect to Colorstripe,
1.20.2.1 RGB AMPLITUDE ERRORS. The demodulated RGB signals
shall exhibit no more than a 0.5% amplitude
differential between lines with modified colorburst and
lines with normal colorburst, measured using 75% color
bars. Field to field (30Hz) changes of this
differential should be less than 0.1%. This
measurement may either be made differentially between
tube grids and cathodes, or directly on the color
difference signals with appropriate scaling;
1.20.2.2 SATURATION CHANGES. The amplitude of the demodulated
color difference signals shall change by no more than
1% when the Colorstripe process is cycled on and off;
1.20.2.3 PHASE CHANGES. The phase of the regenerated color
subcarrier shall change by no more than 1 degree when
the Colorstripe process is cycled on and off; and
4
CONFIDENTIAL
1.20.2.4 LUMINANCE ARTIFACTS. The separated luminance signal
shall exhibit no amplitude variations in excess of
0.25% on lines with modified colorbursts as compared to
lines with normal colorburst.
1.21 "PROCESS" means Macrovision's proprietary Analog Protection System
("APS") in which the video signal is modified by:
1.21.1 the AGC System, or
1.21.2 the AGC System and Colorstripe,
as more particularly described in Attachments 1A and 1B;
1.22 "PRODUCT", sometimes individually referred to herein as a Player or a
Recorder, means one or more of the following:
1.22.1 a Disc Player which incorporates the Device, and an analog
video output port and associated control software, and which
is offered for sale or intended to be offered for sale by
Licensee to consumers, directly or indirectly, for purposes
of play back of real-time Discs; or
1.22.2 a Disc Recorder which incorporates the Device, and an analog
video output port and associated control software, and which
is offered for sale or intended to be offered for sale by
Licensee to consumers, directly or indirectly, for purposes
of play back and/or recording of real-time Discs; or
1.22.3 a digital video tape recorder which incorporates the Device,
and an analog video output port and associated control
software, and which is offered for sale or intended to be
offered for sale by Licensee to consumers, directly or
indirectly, for purposes of recording and/or playback of
real-time Digital Cassettes, and includes digital video tape
recorders as well as camera/recorder ("camcorders")
combinations containing analog video output or input ports;
or
1.22.4 an emulator containing the Device and an analog video output
which emulates DVD functionality as part of a DVD authoring
system; or
1.22.5 a DVD ROM drive which incorporates or utilizes the Device
and an analog video output port and associated control
software, and which is offered for sale or intended to be
offered for sale by Licensee to consumers, directly or
indirectly, for purposes of play back of real-time Discs;
but Product does not include professional duplication equipment.
1.23 "RECORDING DEVICE" means any consumer-type analog video recorders,
including camcorders, and/or consumer-type analog television-video
recorder combinations which Licensee or affiliates manufactures or
sells under its own brand names after the Effective Date;
1.24 "RIGHTS HOLDER" means an owner of program rights to any material to be
recorded on a Disc or a Digital Cassette. Rights Holders will be
under individual licenses from Macrovision to activate the Process by
encoding or embedding codes onto a copy-protected Disc or Digital
Cassette during the mastering and/or manufacturing of the Disc or
Digital Cassette;
5
CONFIDENTIAL
1.25 "SECURITY STANDARDS" means the features Licensee must include in the
design of the Player or Recorder to reasonably ensure that the
Apparatus cannot readily be compromised, activated or de-activated by
an unauthorized party, as specified in Attachment 2;
1.26 "SET TOP DECODER" means a digital video decoder which contains a
Device and which enables consumers to receive television broadcasts or
transmissions of pay-per-view programming over cable, direct broadcast
satellite, telephone lines or by other means;
1.27 "SUBSIDIARY" means any entity in which the majority of shares entitled
to vote for the election of directors is owned or directly or
indirectly controlled by a party hereto, for as long as such ownership
or control exists;
1.28 "TERRITORY" means the countries in which Macrovision has relevant
patents, as listed in Attachment 4, Malaysia and Singapore.
Macrovision, upon the written request of Licensee, will consider in
good faith the addition of individual nations to the Territory on a
nation-by-nation basis; and
1.29 "TRIGGER BITS" means those Analog Protection System (APS) trigger
bits, the function of which is to control the application of the
Process within a Product.
2. GRANT OF RIGHTS/PAYMENTS
2.1 GRANT. For valuable consideration, and subject to the terms and
conditions of this Agreement, Macrovision grants to Licensee, and
Licensee hereby accepts from Macrovision, the following royalty-free,
indivisible, non-exclusive and non-transferable rights and licenses in
and to the Licensed Technology during the term of this Agreement:
2.1.1 the right to purchase the Device from Authorized Component
Suppliers;
2.1.2 the right in the Territory to incorporate, or have
incorporated on a subcontract basis for the benefit of
Licensee, the Device within one or more Products; and
2.1.3 the worldwide right to use, import, offer for sale, sell and
distribute Products, for use in implementing the Process
with program material which has been Copy Protected under
agreement with Macrovision, directly or indirectly to
consumers under Licensee's own brand names; provided that
Licensee also has the worldwide right to physically dispose
of defective Product after it has been destroyed.
2.2 FIELD OF USE RESTRICTIONS. Licensee acknowledges that it is
granted only those rights expressly set out in this Agreement and
no other rights. Without limiting the generality of the
foregoing, this Agreement grants no rights whatsoever with
respect to less-than-real-time applications, pay-per-play Discs
and related hardware, special purpose Recorders or Players, Set
Top Decoders and Product/Set Top Decoder combinations, and
Product manufactured in combination with other digital devices.
Licensee expressly acknowledges that its right to offer for sale,
sell and distribute Products incorporating the Device directly or
indirectly to consumers is restricted solely to allowing such
consumers to utilize such Products to play program material Copy
Protected under an agreement with Macrovision (which restricted
use Licensee will incorporate into its Product manuals).
6
CONFIDENTIAL
2.3 OEM'S. This Agreement is not applicable to situations in which
Licensee proposes to build Product on an original equipment
manufacturer (OEM) basis for third party suppliers who market such
Products under their own brand names, and no rights to sublicense the
Licensed Technology are granted hereunder. A separate non-assertion
agreement between Macrovision and Licensee substantially in the form
attached hereto as Attachment 7 will be required in such instances,
and all such third party suppliers who market such Products under
their own brand names must execute a license agreement with
Macrovision on terms no more onerous than those contained in this
Agreement prior to receiving shipment of Product from Licensee.
Macrovision will negotiate the required non-assertion agreement and
third party license agreements in good faith. Parties desiring to
acquire non-Macrovision capable DVD equipment from Licensee on an OEM
basis are not required to obtain a license from Macrovision.
2.4 FEES APPLICABLE. Notwithstanding Section 2.1, Licensee will choose
(and notify Macrovision in writing of such choice), prior to the first
commercial shipment of Product for revenue, whether or not it will
comply with either of Sections 4.3 and 4.4 of this Agreement. If
Licensee chooses not to comply with either Section 4.3 or 4.4, then
the following fees will apply:
2.4.1 UP-FRONT FEE. Licensee will pay to Macrovision a license
fee of one hundred thousand U.S. dollars ($100,000.00),
payable thirty (30) days after the twelve-month anniversary
of the Effective Date; and
2.4.2 PRODUCT ROYALTY FEES. Licensee will pay to Macrovision a
Product Royalty Fee equal to five U.S. dollars ($5.00) or
two percent (2%) of Licensee's wholesale price to its
distributors, whichever is greater, for each Product sold by
Licensee from the inception of this Agreement until such
time as Licensee becomes compliant. All Product Royalty
Fees are payable to Macrovision within thirty (30) days
after the close of each calendar quarter in which such
Product is sold.
In the event that Licensee chooses to become compliant with Sections
4.3 and 4.4 of this Agreement subsequent to fees becoming payable
under this Section, Licensee will not be relieved of its obligation to
pay any fees which have accrued prior to such time as Licensee
actually becomes compliant.
2.5 PAYMENT TERMS. Each payment due to Macrovision under Section 2.4 will
be accompanied by a written statement substantially in accordance with
Attachment 6, specifying the amount of payment due Macrovision and the
means of calculation thereof. Each statement will be certified as
true and correct by an officer of Licensee. Interest will be due on
any late payment at the rate of eighteen percent (18%) per annum or
the maximum rate permitted under applicable law, whichever is less,
from the due date of such payment until the date of actual payment.
2.6 BILLING ADDRESS. Licensee's billing address for the purposes of this
Agreement, if applicable, is:
------------------------------
------------------------------
------------------------------
Attention:--------------------
Tel:--------------------------
Fax:--------------------------
2.7 AUDIT RIGHTS. Whether or not this Agreement commences as or becomes a
royalty-bearing agreement, Macrovision will have the right during the
term of this Agreement and for one (1) year thereafter to have
7
CONFIDENTIAL
an independent certified public accounting firm review or audit
Licensee records for the purpose of certifying compliance with this
Agreement. All audits will be at Macrovision's expense and conducted
during regular business hours, and begun upon at least one (1) week's
prior notice. If the audit reveals that any payments due to
Macrovision have been understated by more than five percent (5%), or
that Licensee has otherwise materially breached this Agreement, then,
without limiting any other rights which Macrovision may have in
respect thereof, Licensee will reimburse Macrovision for the cost of
the audit. Any discrepancy in the amounts paid will be corrected
within ten (10) days of the written notice of the official results of
the audit being delivered by the auditor.
3. DESIGN REQUIREMENTS AND COSTS
3.1 DESIGN AND DEVELOPMENT OF PRODUCTS. Licensee will design and develop
the Product to incorporate the Licensed Technology and to comply with
the Security Standards. Macrovision will have no responsibility for
the design, development, manufacture and distribution of Products.
Licensee further agrees and acknowledges that the design, development,
manufacture, and integration of the Licensed Technology into a Product
will be at Licensee's sole expense.
3.2 ADAPTIVE CONTROL. Licensee will be solely responsible for
implementation from a software and hardware perspective of the
Adaptive Control of the Process and the Device. Macrovision will not
provide to Licensee any software or hardware component related to
Adaptive Control, or any specification therefor, and Licensee will be
solely responsible for providing (or obtaining from third parties) the
necessary adaptive control capability within the DVD or DVCR format.
Licensee acknowledges that the Product specification developed by
Macrovision provides for Adaptive Control, but that Authorized
Component Suppliers are free to implement Adaptive Control in a unique
manner which may result in Adaptive Control differences from one
Authorized Component Supplier to another.
4. ADDITIONAL TERMS
4.1 ACTIVATION/USAGE OF LICENSED TECHNOLOGY INTO DVD TECHNOLOGY AND/OR
DVCR TECHNOLOGY. For the purposes of this Agreement:
4.1.1 it is assumed that a mechanism by which a Disc and/or a
Digital Cassette can be encoded with a part of the Process
and/or have the digital bit stream marked in such a manner
that it will activate the Apparatus and add the Process to
the analog output of the Product exists and is available to
Licensee and/or Rights Holders;
4.1.2 a Rights Holder will determine if a particular Disc or
Digital Cassette is to be Copy Protected;
4.1.3 the Apparatus will be "off" (i.e., no Process output) unless
a Disc or Digital Cassette has been encoded for copy
protection and/or has copy protection embedded codes; and
4.1.4 Licensee agrees that only Macrovision can authorize usage of
the Process or encoding or embedding of Process codes or
Process activation codes onto Discs and Digital Cassettes.
4.2 UTILIZATION OF LICENSED TECHNOLOGY. Licensee will incorporate the
Licensed Technology in each DVD player and DVD recorder which it
produces or has produced for it. Nothing in this Agreement prohibits
Licensee from also incorporating any other form of anticopy
technology, whether existing now or in the future, into its Products.
8
CONFIDENTIAL
4.3 RECORDING DEVICE RESPONSE TO LICENSED TECHNOLOGY. During the term to
this Agreement, Licensee will use its reasonable best efforts, in
accordance with this provision, to ensure that its Recording Devices
(excluding professional industrial recording equipment) be responsive
to Revision 6.1 and 7.0 (or, at Licensee's option, higher) of the
Process by stopping recording or recording a Process-encoded input
signal in such a way that it is Effective. In particular, Licensee
will not alter the design of any Recording Device (including but not
limited to changes to the luminance AGC system or color processing) in
a manner that would reduce the Effectiveness of the response to the
Process as described above. Licensee will either stop selling and
manufacturing all such Recording Devices that are not responsive to
the Process in a way that is Effective or alter the design (including
but not limited to changes to the luminance AGC system or color
processing) of such non-responsive Recording Devices so as to render
them Effective.
4.3.1 For Recording Devices in production or in the process of
being designed on or before the Effective Date, or which are
first shipped to customers between the Effective Date and
twelve (12) months after the Effective Date, Licensee will
use its good faith efforts to comply with this Section
within eighteen (18) months of the Effective Date; and
4.3.2 for Recording Device model designs that are commenced after
the Effective Date, Licensee will comply with this Section
as of the first commercial shipment of such model.
Licensee will indicate in writing to Macrovision its actions taken in
this regard. Licensee will not be required to recall or correct any
Recording Devices that have been sold to its customers. Macrovision
and Licensee will mutually cooperate in good faith and meet as
reasonably necessary in Sunnyvale, California to evaluate and discuss
potential solutions to Effectiveness problems arising with respect to
those VCRs and TV-VCR Combinations contemplated in Section 4.3.1
above.
4.4 DISPLAY DEVICE PLAYABILITY WITH MACROVISION ANTICOPY SIGNAL.
Licensee, in accordance with the terms of this Section, will ensure
that all Display Devices be Playable with Revision 6.1 and 7.0 (or
higher at Licensee's option) of the Process. Macrovision will provide
the information necessary in its reasonable opinion to support
Licensee in this effort.
4.4.1 For Display Devices in production or in the process of being
designed on or before the Effective Date, or which are first
shipped to customers between the Effective Date and twelve
(12) months after the Effective Date, Licensee will use its
good faith efforts to comply with this Section within
eighteen (18) months of the Effective Date; and
4.4.2 For television, Display Device model designs that are
commenced after the Effective Date, Licensee will comply
with this Section as of the first commercial shipment of
such model.
Licensee acknowledges having tested Revision 7.0 of the Process on its
existing stock of televisions and confirms that the Process functions
appropriately for the purposes of Playability contemplated herein, and
that Licensee will not make any changes to the design of existing
televisions which would have the effect of deteriorating the
Playability of an original Disc or Digital Cassette. Additionally,
Licensee will not make changes to the design of Display Devices, or
implement designs in future Display Devices, which have the effect of
reducing the Effectiveness of the Process when displaying an analog
signal to which the Process has been applied. Licensee will not be
required to recall or correct any Display Devices that have been sold
to its customers. Macrovision and Licensee will mutually cooperate in
good faith and meet as reasonably necessary in Sunnyvale, California
to evaluate and
9
CONFIDENTIAL
discuss potential solutions to problems arising with respect to those
Display Devices contemplated in Section 4.4.1 above.
4.5 PROCESS ATTRIBUTES. Licensee will not make any misrepresentations
about the Apparatus, its effectiveness and attributes that are
contrary to any written representations provided by Macrovision.
Licensee will instruct its distributors to similarly limit
representations made with respect to the Licensed Technology.
4.6 LIQUIDATED DAMAGES. If Licensee fails to comply with Section 4.2
herein, or, having elected to comply with Sections 4.3 and 4.4 herein,
fails to comply with one or both such Sections, then the parties agree
that, as a realistic assessment of damages suffered by Macrovision and
not by way of penalty, Licensee will pay to Macrovision in the form of
liquidated damages the greater of the following amounts:
4.6.1 an amount equal to one hundred thousand U.S. dollars
($100,000.00) plus two percent (2%) of the wholesale value
of all DVD player and DVCR product, whether or not
containing the Licensed Technology, which Licensee
manufactures and makes available for sale; or
4.6.2 five hundred thousand U.S. dollars ($500,000.00).
4.7 CONSEQUENTIAL DAMAGES. Notwithstanding anything contained in this
Agreement, Licensee will be liable to Macrovision for consequential
damages resulting from Licensee's failure to fully comply with the
provisions of Section 4.2, or, after having elected to comply
therewith, Sections 4.3 or 4.4, whether as a result of its negligence
or intentional conduct.
4.8 PAL RIGHTS AND OBLIGATIONS. Licensee's rights and obligations under
this Agreement with respect to PAL standard or non-NTSC standard
Products, Display Devices and Recording Devices will not commence
until the parties have mutually agreed in writing that this Agreement
will pertain to such PAL standard or non-NTSC standard Products,
Display Devices and Recording Devices.
5. SUPPORT AND IMPROVEMENTS
5.1 MACROVISION SUPPORT. When requested by Licensee, Macrovision will
provide, at no cost to Licensee, telephone, fax and email technical
support (and in-person support at Macrovision's offices in Sunnyvale,
California) and documentation reasonably necessary to assist Licensee
and Licensee's chosen Authorized Component Suppliers with the
implementation of the Licensed Technology in its Products. Macrovision
will provide reasonable support to Licensee regarding the use of the
Process and its Playability and Effectiveness with TVs and VCRs, and
evaluate problems and use reasonable efforts to resolve problems
reported to Licensee by consumers.
5.2 IMPROVEMENTS. Macrovision will apprise Licensee of any improvements
in the Apparatus and the Licensed Technology and make such
improvements available to Licensee at no additional charge other than
Macrovision's reasonable non-development related costs for services
requested in writing by Licensee, which costs may include (but are not
limited to) documentation, travel, meal and lodging expenses. During
the term of this Agreement, Licensee may purchase any improved version
of the Device that is made available by Authorized Component
Suppliers.
5.3 COMPLETE DOCUMENTATION. Macrovision represents that the
specifications contained in Attachments 1A, 1B, 2, and 3 are complete
and are the same specifications as are provided to Authorized
Component Suppliers, but may be updated from time to time to reflect
improvements to the Process.
10
CONFIDENTIAL
6. PROPRIETARY RIGHTS
6.1 PROPRIETARY PROPERTY OF MACROVISION. Licensee recognizes and agrees
that the Apparatus, the Process, the Claims and the Licensed
Technology are the proprietary property of Macrovision and that
Licensee has no right to sublicense the Apparatus, the Process, the
Claims or the Licensed Technology to any party and has only such
limited rights as are expressly granted by Macrovision to Licensee
hereunder. Macrovision represents and warrants that it owns the
Licensed Technology and has the right and power to enter into this
Agreement with Licensee. Macrovision represents that it has no
knowledge as of the Effective Date of any claims by third parties that
the Process as implemented using the Device infringes any third party
patents.
6.2 PRODUCT NOTICE. Licensee will display notices as set forth in
Attachment 5 on Products and/or associated collateral material, as
required to appropriately protect Macrovision's intellectual property
rights in the country of Product distribution. Such notices may be in
a language appropriate to the countries where the Product will be
distributed.
7. QUALITY CONTROL
7.1 Licensee will employ such industry quality standards with respect to
use of the Licensed Technology as would be expected of a reasonably
competent manufacturer of electronic devices of the nature and
complexity of the Products, and will design, develop and manufacture
Products and any related operating system software capable of using
the Apparatus in compliance with the Security Standards and Adaptive
Control. Licensee will coordinate any quality control questions which
may arise in respect of Adaptive Control with the relevant Rights
Holders. Licensee further agrees to employ such quality standards
with respect to integration of the Device into Products. Licensee
will be solely responsible for carrying out adequate tests of the
Process variables specified in Attachments 1A and 1B for the purpose
of confirming that the design has been implemented properly and that
the Licensee's Product correctly incorporates the Licensed Technology.
7.2 Licensee will not sell or distribute any Products capable of using the
Apparatus prior to the satisfactory completion of such testing and the
forwarding of written notice to Macrovision confirming that such tests
have been satisfactorily completed.
7.3 On or before the end of each calendar year during the term of this
agreement, upon Macrovision's written request, if Licensee has in its
reasonable opinion made significant changes to any Product model,
Licensee will deliver at its expense to Macrovision's headquarters in
Sunnyvale, California, three representative samples of Products which
contain the Device, at least one of which will be a PAL Product and
one of which will be an NTSC Product. Macrovision will have the right
to test such products for compliance with the specifications set for
in Attachments 1A, 1B, 2, and 3, and upon written request from
Macrovision, Licensee agrees to answer technical questions about the
Products as may be reasonably requested by Macrovision. Macrovision
may retain all such products throughout the term of this Agreement,
however, such products will only be used for the testing activities
described herein.
8. INDEMNIFICATIONS
11
CONFIDENTIAL
8.1 INDEMNIFICATION OF MACROVISION. Licensee will indemnify Macrovision
against any and all third party claims of infringement, including
patent, copyright and trade secret claims which may be asserted
against Macrovision on the grounds and to the extent that any
modifications to the Apparatus, the Claims or the Licensed Technology
made by Licensee infringes upon such third party's patent(s),
copyright(s) or trade secret rights. Licensee will have the right to
defend against, control the defense of, and settle any action based
upon any such claims. Licensee will bear all costs and expenses
incurred in connection with the defense of any such claims or as a
result of any settlement made or judgment reached on the basis of such
claims. Licensee's obligations under this Section 8.1 will arise only
if Macrovision:
8.1.1 promptly notifies Licensee in writing when such a claim is
made;
8.1.2 has complied with the material terms of this Agreement;
8.1.3 furnishes such information and assistance as Licensee may
reasonably request in connection with the defense,
settlement or compromise of such claim;
8.1.4 does not enter into any settlement of any such claim without
Licensee's prior written consent; and
8.1.5 allows Licensee to direct the defense of and/or handle such
suit, claim or proceeding.
9. DISCLAIMER OF WARRANTIES AND REVISION LEVEL OF LICENSED TECHNOLOGY
9.1 THE CLAIMS AND THE LICENSED TECHNOLOGY ARE LICENSED UNDER THIS
AGREEMENT BY MACROVISION TO LICENSEE "AS IS". NOTHING IN THIS
AGREEMENT WILL BE CONSTRUED AS A WARRANTY OR REPRESENTATION THAT:
9.1.1 LICENSEE WILL BE ABLE TO MAKE OR INCORPORATE THE DEVICE OR
THE PRODUCT WITHOUT INFRINGING THE INTELLECTUAL PROPERTY
RIGHTS OF THIRD PARTIES;
9.1.2 LICENSEE WILL BE ABLE TO SUCCESSFULLY MAKE OR INCORPORATE
THE APPARATUS, DEVICE OR PRODUCT; OR
9.1.3 LICENSEE IS GRANTED ANY RIGHTS BY IMPLICATION, ESTOPPEL OR
OTHERWISE EXCEPT THE RIGHTS EXPRESSLY SET FORTH HEREIN.
9.2 SPECIFIC REVISION OF LICENSED TECHNOLOGY. LICENSEE RECOGNIZES THAT
THE LEVEL OF REVISION OF THE PROCESS AND SPECIFICATIONS INCLUDED IN
THIS AGREEMENT IS REVISION 7.01 AND THAT THE REVISION LEVEL TO BE
INCORPORATED AT THE TIME OF MANUFACTURE MAY BE DIFFERENT FROM THE
REVISION LEVEL OF ATTACHMENTS 1A AND 1B AT THE TIME OF EXECUTION OF
THIS AGREEMENT. LICENSEE FURTHER RECOGNIZES THAT THE REVISION LEVEL OF
ATTACHMENTS 1A AND 1B MAY BE THE SUBJECT OF INDUSTRY STANDARDIZATION
OF THE FORMAT SPECIFICATIONS FOR THE DVD TECHNOLOGY AND THE DVCR
TECHNOLOGY AND MAY BE CHANGED FROM REVISION 7.0. LICENSEE ASSUMES
FULL RESPONSIBILITY FOR INCLUDING THE APPROPRIATE REVISION LEVEL
SPECIFICATIONS IN PRODUCTS PRODUCED BY LICENSEE.
12
CONFIDENTIAL
9.3 TECHNICAL REFERENCE DOCUMENT. Macrovision represents that Revision
7.0 meets the proposed terms of the "Technical Reference Document" of
the draft U.S. DVD legislation (as of March 26th, 1996) printed as
Section 201 of the Digital Video Recording Act of 1996, however no
representation or warranty is made or implied that this specification
will meet future versions of the TRD or the final legislation if and
when enacted.
10. LIMITATION OF LIABILITY
10.1 IN NO EVENT WILL MACROVISION'S LIABILITY IN CONNECTION WITH THE
APPARATUS CLAIMS, THE LICENSED TECHNOLOGY, THE DEVICE, THE PROCESS, OR
THIS AGREEMENT EXCEED THE AMOUNTS PAID BY LICENSEE TO MACROVISION
UNDER THIS AGREEMENT. THIS LIMITATION WILL APPLY TO ALL CAUSES OF
ACTION IN THE AGGREGATE, INCLUDING, WITHOUT LIMITATION, BREACH OF
CONTRACT, BREACH OF WARRANTY, MACROVISION'S NEGLIGENCE, STRICT
LIABILITY, PROPRIETARY RIGHTS INFRINGEMENT, MISREPRESENTATION AND ALL
OTHER TORTS.
11. TERM AND TERMINATION
11.1 TERM. This Agreement will commence on the Effective Date and will
continue in effect for a period of five (5) years thereafter, unless
earlier terminated in accordance with its terms. Subject to such
earlier termination, this Agreement will automatically renew for two
(2) three-year renewal terms unless, within ninety (90) days prior to
the commencement of a renewal term, Macrovision is unable to produce
at Licensee's written request at least one letter from a major
Hollywood film studio indicating such studio's desire to have the
Licensed Technology continue to be implemented in industry DVD players
and/or related DVD products. At the end of the second renewal term,
Licensee is free to choose not to renew this Agreement.
11.2 TERMINATION FOR BREACH. Other than with respect to Sections 4.2, 4.3
and 4.4, in the event of a material breach by one party in the
performance of its duties, obligations or undertakings under this
Agreement, the other party will have the right to give written notice
to the breaching party advising such party of the specific breach
involved. If the breaching party will not have remedied such breach
within thirty (30) days after such notice, the other party will have
the right, in addition to any other rights and remedies it may have,
to terminate this Agreement immediately upon written notice to the
defaulting party of such default with reasonable supporting
documentation specifying in detail the nature of such default. The
thirty (30) day cure period is not applicable to breaches of
confidentiality or improper disclosure of proprietary technology or
other trade secrets.
11.3 TERMINATION FOR NON-USE. In the event Licensee does not offer
Products for sale in the normal course of its business for a period
that exceeds one year after the first Product sale, then Macrovision,
at its option, may terminate this Agreement by giving written notice
to Licensee.
11.4 EFFECT OF TERMINATION. Upon the termination of this Agreement other
than for Macrovision's breach (in which event Licensee's rights
hereunder will continue until the expiration of the second of the
renewal terms herein):
11.4.1 all rights granted to Licensee under this Agreement
immediately will terminate and absolutely no interest
whatsoever in any of such rights will thereafter remain in
Licensee; and
13
CONFIDENTIAL
11.4.2 Licensee will immediately cease the manufacture and/or
distribution of Products.
11.5 CONTINUING LIABILITY. No termination of this Agreement will in any
manner whatsoever release, or be construed as releasing, any party
from any liability to the other arising out of or in connection with a
party's breach of or failure to perform any covenant, agreement, duty
or obligation contained herein prior to the date of such termination.
12. CONFIDENTIAL INFORMATION
12.1 CONFIDENTIALITY. Macrovision and Licensee (on behalf of themselves
and their respective officers, employees and agents) each agree to use
all reasonable efforts to keep secret and confidential, and not to use
or permit the use of for any purpose whatsoever, during the term of
this Agreement and for a period of three (3) years thereafter, all
written confidential information (including the terms of this
Agreement) acquired from the other party ("Confidential Information"),
whether prior to or during the term of this Agreement, except as
disclosure or use of such Confidential Information is permitted by
this Agreement or by a writing signed by the parties hereto. This
confidentiality requirement will extend to Licensee's relationships
with subcontractors and/or distributors. To that end, without limiting
the generality of the foregoing, Macrovision and Licensee each agree
that the Licensed Technology technical information provided by
Macrovision and all information concerning the Security Standards is
deemed Confidential Information for the purpose of this Section. The
parties will promptly confirm any oral disclosure of Confidential
Information in writing, and cause all other written materials and
other documents containing Confidential Information to be plainly
marked by the disclosing party to indicate the secret and confidential
nature thereof, and to prevent the unauthorized use or reproduction
thereof. The obligations imposed upon each party hereto by this
Section will not apply with respect to any information which
12.1.1 is or becomes published or otherwise is generally available
to the public other than through the fault of the receiving
party; or
12.1.2 is publicly released in writing by the disclosing party; or
12.1.3 is lawfully obtained from a third party without a duty of
confidentiality; or
12.1.4 is known to the receiving party prior to such disclosure and
was not improperly obtained; or
12.1.5 is, at any time, developed by the receiving party
independently of any such disclosure from the disclosing
party.
12.2 EQUITABLE REMEDIES. Each party acknowledges that in the event it
breaches any confidentiality provision of this Agreement, the other
party may be irreparably harmed and may not have an adequate remedy at
law. In the event either party commits or threatens to commit any such
breach, the other party will be entitled to injunctive relief to
enforce its rights hereunder, without being required to post any bond
or other security.
12.3 SURVIVAL OF OBLIGATIONS. The obligations of the parties under this
Section 12 will survive, in accordance with the terms hereof, the term
and termination of this Agreement and will remain in full force and
effect regardless of the cause of any termination.
14
CONFIDENTIAL
13. EXPORT CONTROLS AND EXCISE TAXES
13.1 FOREIGN CONTROL REGULATIONS. The export regulations of the U.S.
Department of Commerce prohibit, except under special validated
license, the export from the United States of technical data relating
to certain commodities unless the exporter has received certain
written assurances from the foreign importer. In order to facilitate
the exchange of information in accordance with this Agreement and in
conformity with the regulations relating to the exportation of
technical data, Licensee agrees to fully comply with all relevant
regulations of the U.S. Department of Commerce and to assure that no
violation of such regulations or of the authorizing legislation
therefor will occur. In the event that a Japanese governmental
authorization is required for the disclosure of Confidential
Information under this Agreement, Licensee will not disclose such
Confidential Information until Licensee obtains such authorization.
13.2 EXCISE TAXES. The parties anticipate that there will not be any sales
tax, use tax, or other excise tax imposed upon the transactions set
forth in this Agreement. However, in the event that any sales tax,
use tax, or other excise tax is imposed upon Macrovision by any
jurisdiction with respect to such transactions, Licensee will
reimburse Macrovision the amount of any and all such taxes paid by
Macrovision (excluding taxes on the income of Macrovision) to the
fullest extent permitted by law.
14. MISCELLANEOUS PROVISIONS
14.1 GOVERNING LAW. This Agreement will be governed by and interpreted in
accordance with the laws of the State of California, as applied to an
agreement between two residents of California to be wholly performed
in California.
14.2 RIGHTS CUMULATIVE. Each and all of the various rights, powers and
remedies of the parties will be considered to be cumulative with and
in addition to any other rights, powers and remedies which such
parties may have at law or in equity in the event of breach of any of
the terms of this Agreement. The exercise or partial exercise of any
right, power or remedy will neither constitute the exclusive election
thereof nor the waiver of any other right, power or remedy available
to such party.
14.3 NOTICES. All notices, consents or demands of any kind which either
party to the Agreement may be required or may desire to serve on the
other party in connection with this Agreement will be in writing, will
be deemed complete upon delivery and will be delivered by facsimile
with a confirming copy sent by mail, personal service or by
registered or certified mail, return receipt requested, deposited in
the United States mail with postage thereon fully prepaid, addressed
to the party at the address or facsimile number set forth in the
initial paragraph of this Agreement. Service of any such notice,
consent or demand so made by mail will be deemed complete on the date
of actual delivery as shown by the addressee's registry or
certification receipt. Each party hereto may from time-to-time, by
notice in writing served upon the other as aforesaid, designate a
different mailing address or facsimile number or a different person to
which such notices or demands are thereafter to be addressed or
delivered.
14.4 SEVERABILITY. If any of the provisions of this Agreement are held to
be void or unenforceable, the parties agree that such determination
will not result in the nullity or unenforceability of the remaining
portions of this Agreement. The parties further agree to replace such
void or unenforceable provisions of this Agreement with valid and
enforceable provisions which will achieve, to the extent legally
permissible, the economic, business and other purposes of the void or
unenforceable provisions.
15
CONFIDENTIAL
14.5 COUNTERPARTS. This Agreement may be executed in separate
counterparts, and by facsimile, each of which will be deemed an
original, and when executed, separately or together, will constitute a
single original instrument, effective in the same manner as if the
parties had executed one and the same instrument.
14.6 ENTIRE AGREEMENT. This Agreement is intended by the parties to be the
final expression of their agreement and constitutes and embodies the
entire agreement and understanding between the parties hereto and
constitutes a complete and exclusive statement of the terms and
conditions thereof, and will supersede any and all prior
correspondence, conversations, negotiations, agreements or
understandings relating to the same subject matter.
14.7 AMENDMENTS. No change in, modification of or addition to the terms
and conditions contained herein will be valid as between the parties
unless set forth in a writing which is signed by authorized
representatives of both the parties and which specifically states that
it constitutes an amendment to this Agreement.
14.8 WAIVER. No waiver of any term, provision, or condition of this
Agreement, whether by conduct or otherwise, in any one or more
instances, will be deemed to be, or be construed as, a further or
continuing waiver of that term, provision or condition or any other
term, provision or condition of this Agreement.
14.9 ASSIGNMENT. Neither party hereto will assign this Agreement or any
rights or obligations hereunder to any party without the prior written
consent of the other party hereto, other than to a successor in
interest. Such consent will not unreasonably be withheld.
14.10 BINDING ON SUCCESSORS AND ASSIGNS. Subject to the restrictions of
Section 14.9, this Agreement and all of its terms, conditions and
covenants are intended to be fully effective and binding, to the
extent permitted by law, on the successors and permitted assigns
of the parties hereto.
14.11 CAPTIONS. Captions are provided in this Agreement for convenience
only and they form no part of this Agreement and are not to serve
as a basis for interpretation or construction of this Agreement,
nor as evidence of the intention of the parties hereto.
14.12 DISCLAIMER OF AGENCY. Nothing contained in this Agreement is
intended or will be construed so as to constitute the parties to
this Agreement as partners or joint venturers or as agents of each
other. Neither party will have any express or implied right or
authority to assume or create any obligations on behalf of or in
the name of the other party or to bind the other party in any
contract, agreement or undertaking with any third party.
14.13 PUBLICITY. Macrovision and Licensee agree that from
time-to-time it will be beneficial to both parties to issue press
releases and other public announcements concerning benefits
arising from the manufacture and sale of Products. Each party
agrees to submit for mutual approval any press release which
involves the other party and the Licensed Technology, such
approval not to be unreasonably withheld. Macrovision may at any
time "line list" Licensee as an authorized Product Licensee.
Likewise, Licensee may publicly disclose that it is a
Macrovision-authorized Product Licensee.
IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto as of the Effective
16
CONFIDENTIAL
Date.
MACROVISION CORPORATION VICTOR COMPANY OF JAPAN, LIMITED
By: /s/ Victor A. Viegas By: /s/ Tokio Nohara
------------------------------ ------------------------------
(Signature) (Signature)
Name: Victor A. Viegas Name: Tokio Nohara
---------------------------- ----------------------------
(Please print) (Please print)
Title: Vice President Title: Associate Director
--------------------------- General Manager
(Please print) Intellectual Property Department
---------------------------
(Please print)
Date: February 18, 1997 Date: February 18, 1997
---------------------------- ----------------------------
17
CONFIDENTIAL
NOTICE
ATTACHMENTS 1 - 4 OF THIS AGREEMENT ARE THE LATEST VERSION OF THE
"SPECIFICATIONS OF THE MACROVISION ANTITAPING PROCESS FOR DVD APPLICATIONS"
IF YOU DO NOT HAVE A COPY OF THE SPECIFICATIONS DOCUMENT,
PLEASE CALL THE EXECUTIVE ADMINISTRATIVE ASSISTANT AT (408) 743-8419.
18
CONFIDENTIAL
ATTACHMENT 5
PRODUCT NOTICE REQUIREMENTS
A. The Product must have a legible notice (readable by an average person
without magnification), silk screened or placed on a non-removable exterior
tag on the back or bottom, in a readily viewable location of the Product
that will read as follows:
Apparatus Claims of U.S. Patent Nos. 4,631,603, 4,577,216, 4,819,098, and
4,907,093 licensed for limited viewing uses only.
B. In the printed collateral material that accompanies the Product, the
following notice must be printed in an appropriate place in such materials:
This product incorporates copyright protection technology that is protected
by method claims of certain U.S. patents and other intellectual property
rights owned by Macrovision Corporation and other rights owners. Use of
this copyright protection technology must be authorized by Macrovision
Corporation, and is intended for home and other limited viewing uses only
unless otherwise authorized by Macrovision Corporation. Reverse engineering
or disassembly is prohibited.
19
CONFIDENTIAL
ATTACHMENT 6
MACROVISION DVD/DVCR MANUFACTURERQUARTERLY REPORT
LICENSEE:
-----------------------------------
LOCATION:
-----------------------------------
CURRENT PERIOD: FROM: / / TO: / /
---- ---- ---- ---- ---- ----
--------------------------------------------------------------------------------
NUMBER OF PRODUCTS SOLD
CUSTOMER/BUYER NAME
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
REPORT TOTAL:
--------------------------------------------------------------------------------
Product ROYALTY FEE DUE TO MACROVISION @ $ PER UNIT = $
------ -------------
NO SALES / / (If there are no sales in this current period, please provide
report with box checked)
PROJECTED SALES : 1ST QUARTER FROM CURRENT PERIOD (Products)
(3 Months forward) -----------------
(In Units Only) 2ND QUARTER FROM CURRENT PERIOD (Products)
(Months 4-6 on a forward basis) -----------------
Certified by: Date:
--------------------------------------- -----------------
(Signature)
---------------------------------------
(Name)
---------------------------------------
(Title)
20
CONFIDENTIAL
ATTACHMENT 7
DIGITAL VERSATILE DISC PLAYER / DIGITAL VIDEO CASSETTE RECORDER
NON-ASSERTION AGREEMENT FOR ANTICOPY TECHNOLOGY
This DVD/DVCR NON-ASSERTION AGREEMENT is made as of the ____ day of ___________,
199_ by and between MACROVISION CORPORATION, a California corporation, having
its principal place of business at 1341 Orleans Drive, Sunnyvale, California
94089, Facsimile (408) 743-8610 and _______________________________, a
________________ corporation, having its principal place of business at
___________________________, Facsimile ____________________.
RECITALS
A. Macrovision is the owner of all right, title and interest in and to certain
anticopying technology which may be used to protect video material against
unauthorized analog copying in connection with Digital Video Disc or
Digital Video Cassette Recorder program playback.
B. Seller desires to incorporate the Macrovision anticopy technology
components into Products.
C. Macrovision acknowledges Seller's desire and is ready to make such
technology available to Seller in accordance with the terms and conditions
contained in this Agreement.
AGREEMENT
NOW THEREFORE, in consideration of the mutual covenants set forth below, the
parties agree as follows:
1. DEFINITIONS
In this Agreement,
1.1 "ADAPTIVE CONTROL" means the ability to switch between the
primary configuration of the Process and one or more secondary
configurations of the Process on a real-time basis in accordance
with the status of control bits read from the media;
1.2 "AGC SYSTEM" means a system of modifying a video signal so as to
inhibit the making of Playable video recordings therefrom. This
modification consists of adding a combination of either a pseudo
sync or a regular sync pulse with an AGC pulse. These pairs of
sync and AGC pulses are designed to cause the AGC circuitry in a
Recording Device to miscalculate the proper gain setting and
thereby render copy protection performance Effective;
1.3 "AGREEMENT" means this agreement and all attachments hereto;
1.4 "APPARATUS" means apparatus for implementing the Process within a
Product;
1.5 "AUTHORIZED COMPONENT SUPPLIER" means a Macrovision authorized
supplier of manufactured Devices;
21
CONFIDENTIAL
1.6 "CLAIMS" means claims 14-20 of U.S. Patent No. 4,631,603; claims
8-14 of U.S. Patent No. 4,577,216; claims 9-13 of U.S. Patent No.
4,819,098; claims 18-29, 32, 33, 44-52 of U.S. Patent No.
4,907,093; and foreign counterpart patent claims claiming the
priority date of or disclosing and claiming the same inventions
as recited in the above enumerated claims relating to the
Apparatus and the Licensed Technology; and other patent claims
and foreign counterparts thereof, existing now or in the future,
covering the Apparatus and/or the Licensed Technology;
1.7 "COLORSTRIPE" means the modification of a color video signal to
inhibit the making of Playable video recordings thereof. This
modification causes a resultant color picture from a subsequent
video tape recording to show variations in the color fidelity
that appear as bands or stripes of color error;
1.8 "COPY PROTECTED" means, when referring to a Disc or Digital
Cassette, a Disc or Digital Cassette on which the Trigger Bits
have been set to activate the Process in the Product; and when
referring to program material means that the Process has been
applied to the analog output of the Product;
1.9 "DEVICE" means an Authorized Component Supplier's integrated
circuit which contains the Apparatus;
1.10 "DIGITAL CASSETTE" means a prerecorded digital video cassette
which incorporates the Trigger Bits to activate or control part
or all of the Process;
1.11 "DISC" means a prerecorded digital video disc/digital versatile
disc which incorporates the Trigger Bits to activate or control
part or all of the Process;
1.12 "DVCR TECHNOLOGY" means the technology used in the design,
development and/or manufacture of digital video cassette
recorders utilizing industry standard specifications. Such
recorders will reproduce real-time recordings as well as play
back Digital Cassettes. Such recorders do not include digital
recorders that record on a less-than-real time basis for later
playback. For the purposes of this Agreement,
"less-than-real-time" means any application in which a video
program is transmitted to an end user in significantly less time
than the program's normal running time, and is recorded as
received on any suitable medium, for later viewing by the end
user;
1.13 "DVD TECHNOLOGY" means the technology used in the design,
development and/or manufacture of Digital Versatile Disc players
and/or recorders utilizing industry standard specifications,
independent of the laser technology, the method of media
production and the disc or system parameters. Such players
and/or recorders may utilize industry standard specifications and
will reproduce real-time recordings as well as playback Discs.
Such recorders do not include digital recorders that record on a
less-than-real time basis for later playback;
1.14 "EFFECTIVE DATE" means the date or the last of the dates, if
different, on which this Agreement is executed by Macrovision and
Seller, which Effective Date will be entered in the preamble of
this Agreement;
1.15 "LICENSED TECHNOLOGY" means the Claims and the technology
(including the intellectual property embodied therein) specified
in Attachments 1A, 1B, 2 and 3 which is used in the design,
development and/or manufacture of Products which will allow
application of the Process to the analog output of a Player or a
Recorder and which will allow detection of the analog copy
protection signal on the analog input of a Recorder, and all
enhancements thereto which Macrovision chooses to make available
to its licensees, but expressly excludes the technology used for
activation of the Adaptive Control of the Process;
22
CONFIDENTIAL
1.16 "SELLER" means ______________________;
1.17 "MACROVISION" means Macrovision Corporation;
1.18 "MACROVISION LICENSEE" means an entity other than Seller licensed
by Macrovision to import, offer for sale, sell and distribute
worldwide Products, directly or indirectly to consumers under
Macrovision Licensee's own brand name; provided that Macrovision
Licensee also has the worldwide right to dispose of defective
Product after it has been destroyed.
1.19 "PLAYABLE" and "PLAYABILITY" means the characteristic of not
displaying materially degraded pictures from signals containing
the Process, including color bars and active program material.
The ideal playability requirement for an anticopy process
requires that a skilled observer, viewing a variety of typical
and worst case images on a large representative sampling of TV
models in use, should be unable to determine whether copy
protection is turned on or not. In this context, worst case
images are those most likely to produce visible artifacts for the
particular copy protection system in question. For the purposes
of this Agreement, compliance with the Playability requirements
of the Agreement will be determined largely by objective
measurement criteria, but in light of the impossibility of
including every possible situation under an objective measurement
umbrella, Licensee is required to adhere to a subjective
indicator of playability also. The subjective indicator, from
which the objective measurements are derived, is as follows: the
TV model in question, when displaying copy protected images,
should not produce any artifacts AS A RESULT OF THE COPY
PROTECTION which could cause critical consumers to complain.
Without limiting the generality of the foregoing, Playability
will be deemed to have been achieved when:
1.19.1 with respect to the AGC System,
1.19.1.1 SKEW ERRORS. The horizontal phase lock loop
shall have recovered from any disturbance
caused by the pseudo-sync pulse component of
the AGC process such that the first active
line of each field shall be offset
horizontally by no more than 200 nanoseconds
from its correct position. Subsequent lines
shall have smaller offsets in a smoothly
diminishing manner. Also, the offset error
profile on alternate fields shall differ by
no more than 10 percent;
1.19.1.2 CLAMPING ERRORS. The black level clamping
circuits shall have recovered from any
disturbance caused by the pseudo-sync/AGC
pulse pairs, such that the blanking error on
the first active line of each field shall be
within 2 IRE unit of its correct value, and
subsequent lines shall have smaller errors in
a smoothly diminishing manner. Also, the
error profile on alternate fields shall
differ by no more than 0.5 IRE units to
avoid flicker. This measurement should be
carried out when the AGC pulses are at
maximum amplitude;
1.19.1.3 GAIN ERRORS. The gain of the luminance or
chrominance channels of the TV set shall
change by no more than 1% when the AGC pulses
are cycled between maximum and minimum
amplitude;
1.19.1.4 VERTICAL JITTER. Any vertical jitter caused
by the interaction of the pseudo-sync pulses
and the vertical sync circuits of the TV set
shall be less than 0.05% of picture height;
and
23
CONFIDENTIAL
1.19.1.5 RETRACE BLANKING. TV sets should have
adequate blanking to ensure the absence of
any visible artifacts due to the presence of
AGC pulses during the retrace period;
1.19.2 with respect to Colorstripe,
1.19.2.1 RGB AMPLITUDE ERRORS. The demodulated RGB
signals shall exhibit no more than a 0.5%
amplitude differential between lines with
modified colorburst and lines with normal
colorburst, measured using 75% color bars.
Field to field (30Hz) changes of this
differential should be less than 0.1%. This
measurement may either be made differentially
between tube grids and cathodes, or directly
on the color difference signals with
appropriate scaling;
1.19.2.2 SATURATION CHANGES. The amplitude of the
demodulated color difference signals shall
change by no more than 1% when the
Colorstripe process is cycled on and off;
1.19.2.3 PHASE CHANGES. The phase of the regenerated
color subcarrier shall change by no more than
1 degree when the Colorstripe process is
cycled on and off; and
1.19.2.4 LUMINANCE ARTIFACTS. The separated luminance
signal shall exhibit no amplitude variations
in excess of 0.25% on lines with modified
colorbursts as compared to lines with normal
colorburst;
1.20 "PROCESS" means Macrovision's proprietary Analog Protection
System ("APS") in which the video signal is modified by:
1.20.1 the AGC System, or
1.20.2 the AGC System and Colorstripe, as more particularly
described in Attachments 1A and 1B;
1.21 "PRODUCT", sometimes individually referred to herein as a Player
or a Recorder, means one or more of the following:
1.21.1 a Player which incorporates the Device and an analog
video output port and associated control software, and
which is offered for sale or intended to be offered for
sale by Seller to consumers, directly or indirectly,
for purposes of play back of real-time Discs; or
1.21.2 a Recorder which incorporates the Device, and an analog
video output or input port and associated control
software, and which is offered for sale or intended to
be offered for sale by Seller to consumers, directly or
indirectly, for purposes of play back and/or recording
of real-time Discs; or
1.21.3 a Recorder which incorporates the Device and an analog
video output or input port and associated control
software, and which is offered for sale or intended to
be offered for sale by Seller to Macrovision Licensees,
directly or indirectly, for purposes of recording
and/or playback of real-
24
CONFIDENTIAL
time Digital Cassettes, and includes digital video tape
recorders as well as camera/recorder ("camcorders")
combinations containing analog video output or input
ports; or
1.21.4 an emulator containing the Device and an analog video
output which emulates DVD functionality as part of a
DVD authoring system; or
1.21.5 a DVD ROM drive which incorporates or utilizes the
Device and an analog video output port and associated
control software, and which is offered for sale or
intended to be offered for sale by Seller to consumers,
directly or indirectly, for purposes of play back of
real-time Discs.
1.22 "RECORDING DEVICE" means any consumer-type analog video cassette
recorders (VCR), including camcorders, and/or consumer-type
analog television-video cassette recorder combinations which it
or its Subsidiaries or affiliates manufactures or sells after the
Effective Date;
1.23 "RIGHTS HOLDER" means an owner of program rights to any material
to be recorded on a Disc or a Digital Cassette. Rights Holders
will be under individual licenses from Macrovision to activate
the Process by encoding or embedding codes onto a copy-protected
Disc or Digital Cassette during the mastering and/or
manufacturing of the Disc or Digital Cassette;
1.25 "SECURITY STANDARDS" means the features Seller must include in
the design of the Player or Recorder to reasonably ensure that
the Apparatus cannot readily be compromised, activated or
de-activated by an unauthorized party, as specified in Attachment
2;
1.26 "SET TOP DECODER" means a digital video decoder which contains a
Device and which enables consumers to receive television
broadcasts or transmissions of pay-per-view programming over
cable, direct broadcast satellite, telephone lines or by other
means;
1.27 "TERRITORY" means the countries in which Macrovision has relevant
patents, as listed in Attachment 4, and Malaysia. Macrovision,
upon the written request of Seller, will consider in good faith
the addition of individual nations to the Territory on a
nation-by-nation basis; and
1.29 "TRIGGER BITS" means those Analog Protection System (APS) trigger
bits, the function of which is to control the application of the
Process within a Product.
2. GRANT OF RIGHTS/PAYMENTS
2.1 GRANT. For valuable consideration, and subject to the terms and
conditions of this Agreement, Macrovision hereby agrees not to assert
against Seller the Apparatus Claims as a result of Seller engaging in
the following acts:
2.1.1 purchasing the Device from Authorized Component Suppliers;
2.1.2 incorporating in the territory, or having incorporated on a
subcontract basis for the benefit of Seller, the Device
within one or more Products; and
2.1.3 manufacturing in the Territory and selling worldwide
Products to Macrovision Licensees.
25
CONFIDENTIAL
2.2 FIELD OF USE RESTRICTIONS. Seller acknowledges that it is granted
only those rights expressly set out in this Agreement and no other
rights. Without limiting the generality of the foregoing, this
Agreement grants no rights whatsoever with respect to
less-than-real-time applications, pay-per-play Discs and related
hardware, special purpose Recorders or Players, Set Top Decoders and
Product/Set Top Decoder combinations, and Product manufactured in
combination with other digital devices.
2.3 AUDIT RIGHTS. Macrovision will have the right during the term of this
Agreement and for one (1) year thereafter to have an independent
certified public accounting firm review or audit Seller records for
the purpose of certifying compliance with this Agreement. All audits
will be at Macrovision's expense and conducted during regular business
hours, and begun upon at least one (1) week's prior notice. If the
audit reveals that Seller has materially breached this Agreement,
then, without limiting any other rights which Macrovision may have in
respect thereof, Seller will reimburse Macrovision for the cost of the
audit.
3. DESIGN REQUIREMENTS AND COSTS
3.1 DESIGN AND DEVELOPMENT OF PRODUCTS. Seller will design and develop
the Product to incorporate the Licensed Technology and to comply with
the Security Standards. Macrovision will have no responsibility for
the design, development, manufacture and distribution of Products.
Seller further agrees and acknowledges that the design, development,
manufacture, and integration of the Licensed Technology into a Product
will be at Seller's sole expense.
3.2 ADAPTIVE CONTROL. Seller will be solely responsible for
implementation from a software and hardware perspective of the
Adaptive Control of the Process and the Device. Macrovision will not
provide to Seller any software or hardware component related to
Adaptive Control, or any specification therefor, and Seller will be
solely responsible for providing (or obtaining from third parties) the
necessary adaptive control capability within the DVD or DVCR format.
Seller acknowledges that the Product specification developed by
Macrovision provides for Adaptive Control, but that Authorized
Component Suppliers are free to implement Adaptive Control in a unique
manner which may result in Adaptive Control differences from one
Authorized Component Supplier to another.
4. ADDITIONAL TERMS
4.1 ACTIVATION/USAGE OF LICENSED TECHNOLOGY INTO DVD TECHNOLOGY AND/OR
DVCR TECHNOLOGY. For the purposes of this Agreement:
4.1.1 it is assumed that a mechanism by which a Disc and/or a
Digital Cassette can be encoded with a part of the Process
and/or have the digital bit stream marked in such a manner
that it will activate the Apparatus and add the Process to
the analog output of the Product exists and is available to
Seller and/or Rights Holders;
4.1.2 a Rights Holder will determine if a particular Disc or
Digital Cassette is to be Copy Protected;
4.1.3 the Apparatus will be "off" (i.e., no Process output) unless
a Disc or Digital Cassette has been encoded for copy
protection and/or has copy protection embedded codes; and
4.1.4 Seller agrees that only Macrovision can authorize usage of
the Process or encoding or embedding of Process codes or
Process activation codes onto Discs and Digital Cassettes.
26
CONFIDENTIAL
4.2 UTILIZATION OF LICENSED TECHNOLOGY. Seller will incorporate the
Licensed Technology in each DVD player and DVD recorder which it
produces for a Macrovision Licensee. Nothing in this Agreement
prohibits Seller from also incorporating any other form of anticopy
technology, whether existing now or in the future, into its Products.
4.3 PROCESS ATTRIBUTES. Seller will not make any misrepresentations about
the Apparatus, its effectiveness and attributes that are contrary to
any written representations provided by Macrovision. Seller will
instruct its distributors to similarly limit representations made with
respect to the Licensed Technology.
5. SUPPORT AND IMPROVEMENTS
5.1 IMPROVEMENTS. Macrovision will apprise Seller of any improvements in
the Apparatus and the Licensed Technology and make such improvements
available to Seller at no additional charge other than Macrovision's
reasonable non-development related costs for services requested in
writing by Seller, which costs may include (but are not limited to)
documentation, travel, meal and lodging expenses. During the term of
this Agreement, Seller may purchase any improved version of the Device
that is made available by Authorized Component Suppliers.
5.2 COMPLETE DOCUMENTATION. Macrovision represents that the
specifications contained in Attachments 1A, 1B, 2, and 3 are complete
and are the same specifications as are provided to Authorized
Component Suppliers, but may be updated from time to time to reflect
improvements to the Process.
6. PROPRIETARY RIGHTS
6.1 PROPRIETARY PROPERTY OF MACROVISION. Seller recognizes and agrees
that the Apparatus, the Process, the Claims and the Licensed
Technology are the proprietary property of Macrovision and that Seller
has no right to sublicense the Apparatus, the Process, the Claims or
the Licensed Technology to any party and has only such limited rights
as are expressly granted by Macrovision to Seller hereunder.
Macrovision represents and warrants that it owns the Licensed
Technology and has the right and power to enter into this Agreement
with Seller. Macrovision represents that it has no knowledge as of
the Effective Date of any claims by third parties that the Process as
implemented using the Device infringes any third party patents.
6.2 PRODUCT NOTICE. Seller will display notices as set forth in
Attachment 5 on Products and/or associated collateral material, as
required to appropriately protect Macrovision's intellectual property
rights in the country of Product distribution. Such notices may be in
a language appropriate to the countries where the Product will be
distributed.
7. QUALITY CONTROL
7.1 Seller will employ such industry quality standards with respect to use
of the Licensed Technology as would be expected of a reasonably
competent manufacturer of electronic devices of the nature and
complexity of the Products, and will design, develop and manufacture
Products and any related operating system software capable of using
the Apparatus in compliance with the Security Standards and Adaptive
Control. Seller will coordinate any quality control questions which
may arise in respect of Adaptive Control with the relevant Rights
Holders. Seller further agrees to employ such quality standards with
respect to integration of the Device into Products. Seller will be
solely responsible for carrying out adequate tests of the Process
variables specified in Attachments 1A and 1B for the purpose of
confirming that the design has been implemented properly and that the
Seller's Product correctly incorporates the Licensed Technology.
27
CONFIDENTIAL
7.2 Seller will not sell or distribute any Products capable of using the
Apparatus prior to the satisfactory completion of such testing and the
forwarding of written notice to Macrovision confirming that such tests
have been satisfactorily completed.
7.3 On or before the end of each calendar year during the term of this
agreement, upon Macrovision's written request, Seller will deliver at
its expense to Macrovision's headquarters in Sunnyvale, California,
three representative samples of Products which contain the Device, at
least one of which will be a PAL Product and one of which will be an
NTSC Product. Macrovision will have the right to test such products
for compliance with the specifications set for in Attachments 1A, 1B,
2, and 3, and upon written request from Macrovision, Seller agrees to
answer technical questions about the Products as may be reasonably
requested by Macrovision. Macrovision may retain all such products
throughout the term of this Agreement, however, such products will
only be used for the testing activities described herein.
8. INDEMNIFICATIONS
8.1 INDEMNIFICATION OF MACROVISION. Seller will indemnify Macrovision
against any and all third party claims of infringement, including
patent, copyright and trade secret claims which may be asserted
against Macrovision on the grounds and to the extent that any
modifications to the Apparatus, the Claims or the Licensed Technology
made by Seller infringes upon such third party's patent(s),
copyright(s) or trade secret rights. Seller will have the right to
defend against, control the defense of, and settle any action based
upon any such claims. Seller will bear all costs and expenses,
including reasonable attorneys' fees, incurred in connection with the
defense of any such claims or as a result of any settlement made or
judgment reached on the basis of such claims. Seller's obligations
under this Section 8.1 will arise only if Macrovision:
8.1.1 promptly notifies Seller in writing when such a claim is
made;
8.1.2 has complied with the material terms of this Agreement;
8.1.3 furnishes such information and assistance as Seller may
reasonably request in connection with the defense,
settlement or compromise of such claim;
8.1.4 does not enter into any settlement of any such claim without
Seller's prior written consent; and
8.1.5 allows Seller to direct the defense of and/or handle such
suit, claim or proceeding.
9. DISCLAIMER OF WARRANTIES AND REVISION LEVEL OF LICENSED TECHNOLOGY
9.1 THE CLAIMS AND THE LICENSED TECHNOLOGY ARE LICENSED UNDER THIS
AGREEMENT BY MACROVISION TO SELLER "AS IS". NOTHING IN THIS AGREEMENT
WILL BE CONSTRUED AS A WARRANTY OR REPRESENTATION THAT:
9.1.1 SELLER WILL BE ABLE TO MAKE OR INCORPORATE THE DEVICE OR THE
PRODUCT WITHOUT INFRINGING THE INTELLECTUAL PROPERTY RIGHTS
OF THIRD PARTIES;
9.1.2 SELLER WILL BE ABLE TO SUCCESSFULLY MAKE OR INCORPORATE THE
APPARATUS, DEVICE OR PRODUCT; OR
28
CONFIDENTIAL
9.1.3 SELLER IS GRANTED ANY RIGHTS BY IMPLICATION, ESTOPPEL OR
OTHERWISE EXCEPT THE RIGHTS EXPRESSLY SET FORTH HEREIN.
9.2 SPECIFIC REVISION OF LICENSED TECHNOLOGY. SELLER RECOGNIZES THAT THE
LEVEL OF REVISION OF THE PROCESS AND SPECIFICATIONS INCLUDED IN THIS
AGREEMENT IS REVISION 7.01 AND THAT THE REVISION LEVEL TO BE
INCORPORATED AT THE TIME OF MANUFACTURE MAY BE DIFFERENT FROM THE
REVISION LEVEL OF ATTACHMENTS 1A AND 1B AT THE TIME OF EXECUTION OF
THIS AGREEMENT. SELLER FURTHER RECOGNIZES THAT THE REVISION LEVEL OF
ATTACHMENTS 1A AND 1B MAY BE THE SUBJECT OF INDUSTRY STANDARDIZATION
OF THE FORMAT SPECIFICATIONS FOR THE DVD TECHNOLOGY AND THE DVCR
TECHNOLOGY AND MAY BE CHANGED FROM REVISION 7.0. SELLER ASSUMES FULL
RESPONSIBILITY FOR INCLUDING THE APPROPRIATE REVISION LEVEL
SPECIFICATIONS IN PRODUCTS PRODUCED BY SELLER.
9.3 TECHNICAL REFERENCE DOCUMENT. Macrovision represents that Revision
7.0 meets the proposed terms of the "Technical Reference Document" of
the draft U.S. DVD legislation (as of March 26th, 1996) printed as
Section 201 of the Digital Video Recording Act of 1996, however no
representation or warranty is made or implied that this specification
will meet future versions of the TRD or the final legislation if and
when enacted.
10. LIMITATION OF LIABILITY
10.1 IN NO EVENT WILL MACROVISION'S LIABILITY IN CONNECTION WITH THE
APPARATUS CLAIMS, THE LICENSED TECHNOLOGY, THE DEVICE, THE PROCESS, OR
THIS AGREEMENT EXCEED THE AMOUNTS PAID BY LICENSEE TO MACROVISION
UNDER THIS AGREEMENT. THIS LIMITATION WILL APPLY TO ALL CAUSES OF
ACTION IN THE AGGREGATE, INCLUDING, WITHOUT LIMITATION, BREACH OF
CONTRACT, BREACH OF WARRANTY, MACROVISION'S NEGLIGENCE, STRICT
LIABILITY, PROPRIETARY RIGHTS INFRINGEMENT, MISREPRESENTATION AND ALL
OTHER TORTS.
11. TERM AND TERMINATION
11.1 TERM. This Agreement will become effective upon execution by both
parties, and will continue in effect for as long as the DVD/DVCR
License Agreement between Macrovision and Seller is effective, unless
earlier terminated in accordance with its terms.
11.2 TERMINATION FOR BREACH. Other than with respect to Sections 4.2, 4.3
and 4.4, in the event of a material breach by one party in the
performance of its duties, obligations or undertakings under this
Agreement, the other party will have the right to give written notice
to the breaching party advising such party of the specific breach
involved. If the breaching party will not have remedied such breach
within thirty (30) days after such notice, the other party will have
the right, in addition to any other rights and remedies it may have,
to terminate this Agreement immediately upon written notice to the
defaulting party of such default with reasonable supporting
documentation specifying in detail the nature of such default. The
thirty (30) day cure period is not applicable to breaches of
confidentiality or improper disclosure of proprietary technology or
other trade secrets.
29
CONFIDENTIAL
11.3 TERMINATION FOR NON-USE. In the event Seller does not offer Products
for sale in the normal course of its business within two years of the
Effective Date of this Agreement, or fails to offer Products for sale
in the normal course of its business for any period thereafter during
the term of this Agreement that exceeds one year, then Macrovision, at
its option, may terminate this Agreement by giving written notice to
Seller.
11.4 EFFECT OF TERMINATION. Upon the termination of this Agreement other
than for Macrovision's breach (in which event Seller's rights
hereunder will continue until the expiration of the second of the
renewal terms herein):
11.4.1 all rights granted to Seller under this Agreement
immediately will terminate and absolutely no interest
whatsoever in any of such rights will thereafter remain in
Seller; and
11.4.2 Seller will immediately cease the manufacture and/or
distribution of Products.
11.5 CONTINUING LIABILITY. No termination of this Agreement will in any
manner whatsoever release, or be construed as releasing, any party
from any liability to the other arising out of or in connection with a
party's breach of or failure to perform any covenant, agreement, duty
or obligation contained herein prior to the date of such termination.
12. CONFIDENTIAL INFORMATION
12.1 CONFIDENTIALITY. Macrovision and Seller (on behalf of themselves and
their respective officers, employees and agents) each agree to use all
reasonable efforts to keep secret and confidential, and not to use or
permit the use of for any purpose whatsoever, during the term of this
Agreement and for a period of three (3) years thereafter, all written
confidential information (including the terms of this Agreement)
acquired from the other party ("Confidential Information"), whether
prior to or during the term of this Agreement, except as disclosure or
use of such Confidential Information is permitted by this Agreement or
by a writing signed by the parties hereto. This confidentiality
requirement will extend to Seller's relationships with subcontractors
and/or distributors. To that end, without limiting the generality of
the foregoing, Macrovision and Seller each agree that the Licensed
Technology technical information provided by Macrovision and all
information concerning the Security Standards is deemed Confidential
Information for the purpose of this Section. The parties will promptly
confirm any oral disclosure of Confidential Information in writing,
and cause all other written materials and other documents containing
Confidential Information to be plainly marked by the disclosing party
to indicate the secret and confidential nature thereof, and to prevent
the unauthorized use or reproduction thereof. The obligations imposed
upon each party hereto by this Section will not apply with respect to
any information which
12.1.1 is or becomes published or otherwise is generally available
to the public other than through the fault of the receiving
party; or
12.1.2 is publicly released in writing by the disclosing party; or
12.1.3 is lawfully obtained from a third party without a duty of
confidentiality; or
12.1.4 is known to the receiving party prior to such disclosure and
was not improperly obtained; or
12.1.5 is, at any time, developed by the receiving party
independently of any such disclosure from the disclosing
party.
30
CONFIDENTIAL
12.2 EQUITABLE REMEDIES. Each party acknowledges that in the event it
breaches any confidentiality provision of this Agreement, the other
party may be irreparably harmed and may not have an adequate remedy at
law. In the event either party commits or threatens to commit any such
breach, the other party will be entitled to injunctive relief to
enforce its rights hereunder, without being required to post any bond
or other security.
12.3 SURVIVAL OF OBLIGATIONS. The obligations of the parties under this
Section 12 will survive, in accordance with the terms hereof, the term
and termination of this Agreement and will remain in full force and
effect regardless of the cause of any termination.
13. EXPORT CONTROLS AND EXCISE TAXES
13.1 FOREIGN CONTROL REGULATIONS. The export regulations of the U.S.
Department of Commerce prohibit, except under special validated
license, the export from the United States of technical data relating
to certain commodities unless the exporter has received certain
written assurances from the foreign importer. In order to facilitate
the exchange of information in accordance with this Agreement and in
conformity with the regulations relating to the exportation of
technical data, Seller agrees to fully comply with all relevant
regulations of the U.S. Department of Commerce and to assure that no
violation of such regulations or of the authorizing legislation
therefor will occur. In the event that a Japanese governmental
authorization is required for the disclosure of Confidential
Information under this Agreement, Seller will not disclose such
Confidential Information until Seller obtains such authorization.
13.2 EXCISE TAXES. The parties anticipate that there will not be any sales
tax, use tax, or other excise tax imposed upon the transactions set
forth in this Agreement. However, in the event that any sales tax,
use tax, or other excise tax is imposed upon Macrovision by any
jurisdiction with respect to such transactions, Seller will reimburse
Macrovision the amount of any and all such taxes paid by Macrovision
(excluding taxes on the income of Macrovision) to the fullest extent
permitted by law.
14. MISCELLANEOUS PROVISIONS
14.1 GOVERNING LAW. This Agreement will be governed by and interpreted in
accordance with the laws of the State of California, as applied to an
agreement between two residents of California to be wholly performed
in California.
14.2 RIGHTS CUMULATIVE. Each and all of the various rights, powers and
remedies of the parties will be considered to be cumulative with and
in addition to any other rights, powers and remedies which such
parties may have at law or in equity in the event of breach of any of
the terms of this Agreement. The exercise or partial exercise of any
right, power or remedy will neither constitute the exclusive election
thereof nor the waiver of any other right, power or remedy available
to such party.
14.3 NOTICES. All notices, consents or demands of any kind which either
party to the Agreement may be required or may desire to serve on the
other party in connection with this Agreement will be in writing, will
be deemed complete upon delivery and will be delivered by facsimile
with a confirming copy sent by mail, personal service or by
registered or certified mail, return receipt requested, deposited in
the United States mail with postage thereon fully prepaid, addressed
to the party at the address or facsimile number set forth in the
initial paragraph of this Agreement. Service of any such notice,
consent or demand so made by mail will be deemed complete on the date
of actual delivery as shown by the addressee's registry or
certification receipt. Each party hereto may from time-to-time, by
notice in writing served upon the other as aforesaid,
31
CONFIDENTIAL
designate a different mailing address or facsimile number or a
different person to which such notices or demands are thereafter to be
addressed or delivered.
14.4 SEVERABILITY. If any of the provisions of this Agreement are held to
be void or unenforceable, the parties agree that such determination
will not result in the nullity or unenforceability of the remaining
portions of this Agreement. The parties further agree to replace such
void or unenforceable provisions of this Agreement with valid and
enforceable provisions which will achieve, to the extent legally
permissible, the economic, business and other purposes of the void or
unenforceable provisions.
14.5 COUNTERPARTS. This Agreement may be executed in separate
counterparts, and by facsimile, each of which will be deemed an
original, and when executed, separately or together, will constitute a
single original instrument, effective in the same manner as if the
parties had executed one and the same instrument.
14.6 ENTIRE AGREEMENT. This Agreement is intended by the parties to be the
final expression of their agreement and constitutes and embodies the
entire agreement and understanding between the parties hereto and
constitutes a complete and exclusive statement of the terms and
conditions thereof, and will supersede any and all prior
correspondence, conversations, negotiations, agreements or
understandings relating to the same subject matter.
14.7 AMENDMENTS. No change in, modification of or addition to the terms
and conditions contained herein will be valid as between the parties
unless set forth in a writing which is signed by authorized
representatives of both the parties and which specifically states that
it constitutes an amendment to this Agreement.
14.8 WAIVER. No waiver of any term, provision, or condition of this
Agreement, whether by conduct or otherwise, in any one or more
instances, will be deemed to be, or be construed as, a further or
continuing waiver of that term, provision or condition or any other
term, provision or condition of this Agreement.
14.9 ASSIGNMENT. Neither party hereto will assign this Agreement or any
rights or obligations hereunder to any party without the prior written
consent of the other party hereto, other than to a successor in
interest. Such consent will not unreasonably be withheld.
14.10 BINDING ON SUCCESSORS AND ASSIGNS. Subject to the restrictions of
Section 14.9, this Agreement and all of its terms, conditions and
covenants are intended to be fully effective and binding, to the
extent permitted by law, on the successors and permitted assigns
of the parties hereto.
14.11 CAPTIONS. Captions are provided in this Agreement for convenience
only and they form no part of this Agreement and are not to serve
as a basis for interpretation or construction of this Agreement,
nor as evidence of the intention of the parties hereto.
14.12 DISCLAIMER OF AGENCY. Nothing contained in this Agreement is
intended or will be construed so as to constitute the parties to
this Agreement as partners or joint venturers or as agents of each
other. Neither party will have any express or implied right or
authority to assume or create any obligations on behalf of or in
the name of the other party or to bind the other party in any
contract, agreement or undertaking with any third party.
14.13 PUBLICITY. Macrovision and Seller agree that from time-to-time it
will be beneficial to both parties to issue press releases and
other public announcements concerning benefits arising from the
manufacture and sale of Products. Each party agrees to submit for
mutual approval any press release which involves the other party
32
CONFIDENTIAL
and the Licensed Technology, such approval not to be unreasonably
withheld. Macrovision may at any time "line list" Seller as an
authorized Product Seller. Likewise, Seller may publicly disclose
that it is a Macrovision-authorized Product Seller.
IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto as of the Effective Date.
MACROVISION CORPORATION
---------------------
By: By:
---------------------------- ----------------------------
(Signature) (Signature)
Name: Name:
-------------------------- --------------------------
(Please print) (Please print)
Title: Title:
------------------------- -------------------------
(Please print) (Please print)
Date: Date:
-------------------------- --------------------------
33
CONFIDENTIAL
Digital Versatile Disc (DVD) Player / Digital Video Cassette Recorder (DVCR) License Agreement for Anticopy Technology - Macrovision Corp. and Victor Co. of Japan Ltd.
Was this helpful?