SOFTWARE OEM LICENSE AGREEMENT
This Software License and OEM Agreement ("Agreement") is entered into this
19th day of May, 1997 (the "Effective Date") by and between Summit Design, Inc.,
a Delaware corporation with principal offices at 9305 SW Gemini Drive,
Beaverton, Oregon 97008 and Test Systems Strategies, Inc., an Oregon corporation
(collectively, "SDI"), and Credence Systems Corporation, a Delaware corporation
with principal offices at 215 Fourier Avenue, Fremont, California 94539 ("CSC").
RECITALS
WHEREAS, CSC desires to purchase licenses to certain SDI software products,
and SDI desires to sell such licenses to CSC in accordance with the terms of
this Agreement; and
WHEREAS, SDI desires to grant to CSC, and CSC desires to receive from SDI,
a non-exclusive license to bundle certain of SDI's products with certain CSC
products and to distribute such SDI products, in object code format only, with
CSC's products in accordance with the terms of this Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
contained herein, the parties agree as follows:
Section 1
DEFINITIONS
For purposes of this Agreement the following terms shall have the meanings
set forth below:
1.1 CSC PRODUCTS. "CSC Products" means those CSC automatic test equipment
products which are described on SCHEDULE A attached to this Agreement, as it may
be amended from time to time by mutual agreement of the parties.
1.2 SDI DOCUMENTATION. "SDI Documentation" means all written or
electronic technical documentation furnished by SDI during the term of this
Agreement that relates to the VTB Software.
1.3 VTB. "VTB Software" means SDI's proprietary software, in machine-
readable, compiled object code format only, as more fully described on SCHEDULE
B, including any bug fixes, corrections, or other modifications hereinafter
furnished to CSC by SDI in connection with the VTB Software, whether requested
by CSC pursuant to a Maintenance Agreement between CSC and SDI or initiated by
SDI.
1.4 MAINTENANCE AGREEMENT. "Maintenance Agreement" shall mean the
maintenance agreement for maintenance of the VTB Software in the form set forth
in SCHEDULE C.
1.5 END USER LICENSE AGREEMENT. "End User License Agreement" shall mean
the end user license agreement for the VTB Software in the form set forth in
SCHEDULE E.
Section 2
PURCHASE GRANT AND DELIVERABLES
2.1 VTB SOFTWARE LICENSE PURCHASE. CSC shall purchase licenses to the VTB
Software for the prices and in the quantity set forth in SCHEDULE D, in
accordance with the terms set forth in SCHEDULE D. Each of such licenses shall
be subject to the terms of the End User License Agreement.
2.2 MAINTENANCE PURCHASE. CSC and SDI shall execute the Maintenance
Agreement set forth in SCHEDULE C, as of the date hereof. CSC shall sign an
irrevocable purchase order for such Maintenance Agreement for eighteen (18)
months of maintenance for an aggregate purchase price of $2,000,000. Payment
shall be made upon Closing (as defined in the Asset Purchase Agreement among
CSC, SDI and Test Systems, Inc.) ("Closing") by wire transfer to a bank account
designated by SDI.
2.3 DISTRIBUTION LICENSE. Subject to the terms and conditions of this
Agreement, SDI hereby grants to CSC and its affiliates, under all of SDI's
intellectual property rights in and to the VTB Software, a worldwide, non-
exclusive, non-transferable (except as provided in Section 10.2 below) license
to use the VTB Software for internal purposes (provided a license for such use
has been purchased from SDI) and distribute units of VTB Software purchased
hereunder through its normal distribution channels, in machine-readable,
compiled object code format only, and only when bundled with CSC Products or
sold to customers of CSC who have purchased CSC Products. For each CSC Product
sold to a customer, CSC shall only issue one (1) VTB Software license and the
VTB Software shall only be distributed to end users who agree to be bound by the
terms of the End User License Agreement. Except as expressly provided in
Section 2.4 below, CSC shall have no right to sublicense the rights granted
hereunder by SDI, provided that CSC and its affiliates may use subdistributors
in their distribution efforts ' CSC agrees that it shall be responsible for the
compliance of its affiliates and subdistributors of the relevant terms of this
Agreement. CSC shall not distribute or market the VTB Software in any manner
except as expressly provided in this Section 2.3. Notwithstanding the foregoing,
SDI agrees that it shall not distribute the VTB Software through OEM's which are
automatic test equipment vendors to the semiconductor industry prior to January
1, 2000.
2.4 SUBLICENSING OF VTB SOFTWARE BY CSC.
2.4.1 RESTRICTIONS. Each unit of VTB Software shall be distributed
by CSC with a license in the form set forth on SCHEDULE E.
2.4.2 INDEMNITY. CSC shall be solely responsible for, and SDI shall
have no obligation to honor, any warranties that CSC provides to its customers
with respect to the VTB Software that are in addition to, or inconsistent with,
the warranties provided by SDI in this Agreement or the End User License
Agreement. CSC shall defend any claim against SDI arising in connection with
any such warranties to CSC's customers, express, implied, statutory, or
otherwise, and shall pay any settlements or damages awarded to SDI that are
based on any such warranty.
2.4.3 INFRINGEMENTS. CSC agrees to use reasonable commercial efforts
to enforce violations or infringements under any agreements for the VTB Software
with its customers and to inform SDI promptly of any known violation,
infringement or breach.
2.5 DOCUMENTATION. SDI shall provide the SDI Documentation included with
each unit of the VTB Software.
2.6 PROPRIETARY NOTICES. CSC shall not remove, efface or obscure any
copyright notices or other proprietary notices or legends from any SDI materials
provided hereunder.
2.7 OWNERSHIP. SDI shall retain all right, title and interest, including
all intellectual property rights, in and to the VTB Software and SDI
Documentation, except as otherwise provided in the Software Development
Agreement of even date herewith.
2.8 REPORTING. CSC shall, within thirty (30) days of the end of each
calendar quarter during the term of this Agreement, prepare a report summarizing
the number and type of copies of VTB Software distributed during such quarter.
2.9 AUDIT. CSC shall maintain complete and accurate accounting records,
in accordance with sound accounting practices, to support and document VTB
Software licenses distributed in connection with this Agreement. Such records
shall be retained for a period of at least two (2) years after the year to which
they pertain.
2.10 VTB SOFTWARE STEERING COMMITTEE. SDI and CSC will each appoint two
(2) representatives to a steering committee to coordinate information on the
development of the VTB Product in accordance with Section 2.1 of the Software
Development Agreement of even date herewith.
Section 3
SDI TRADEMARKS
CSC acknowledges that the symbols, trademarks and service marks adopted by
SDI or its suppliers to identify the VTB Software, as set forth in SCHEDULE F
attached to this Agreement (the "Trademarks"), belong to SDI and its suppliers
and that CSC shall have no rights in such Trademarks except as expressly set
forth herein. All VTB Software distributed by CSC hereunder and all
documentation, associated brochures, packaging and advertising shall display the
Trademarks in accordance with SDI's reasonable instruction, samples of all
materials that may be distributed by CSC displaying the Trademarks shall be
submitted to SDI upon SDI's reasonable request, and the Trademarks shall be used
only in a form so approved by SDI.
Section 4
TERM
4.1 INITIAL TERM. This Agreement shall become effective on the Effective
Date and shall remain in effect until January 1, 2000. This Agreement may be
renewed upon the mutual written agreement of the parties. Each party's remedy
for breach of this Agreement shall be an action for damages or injunctive
relief; neither party shall be entitled to terminate this Agreement for any
reason.
4.2 SURVIVAL. The sublicenses granted to end users pursuant to Section
2.4.1 shall survive the expiration of this Agreement pursuant to their terms.
Also, provisions of Sections 2.7 (Ownership), 2.10 (Audit), 4 (Term), 5
(Confidentiality), 9 (Limitation of Liability) and 10 (Miscellaneous) shall
survive the expiration of this Agreement.
Section 5
CONFIDENTIALITY
5.1 OBLIGATIONS. Each party (the "receiving party") acknowledges and
agrees that any business and technical information provided to the receiving
party by the other party (the "disclosing party") hereunder constitutes the
confidential and proprietary information of the disclosing party, and that the
receiving party's protection thereof is essential to this Agreement and a
condition to the receiving party's use and possession thereof. The receiving
party shall retain in strict confidence and not disclose to any third party
(except as authorized by this Agreement) without the disclosing party's express
written consent, any and all such information. CSC acknowledges and agrees that
the VTB Software is confidential and proprietary information of SDI.
5.2 EXCEPTIONS. The receiving party shall be relieved of this obligation
of confidentiality to the extent any such information:
(i) was in the public domain at the time it was disclosed or has
become in the public domain through no fault of the receiving party;
(ii) the receiving party can prove was known to the receiving party,
without restriction, at the time of disclosure as shown by the files of the
receiving party in existence at the time of disclosure;
(iii) is disclosed by the receiving party with the prior written
approval of the disclosing party;
(iv) the receiving party can prove was independently developed by the
receiving party without any use of the disclosing party's confidential
information and by employees or other agents of the receiving party who
have not had access to any of the disclosing party's confidential
information; or
(v) becomes known to the receiving party, without restriction,
from a source other than the disclosing party without breach of this
Agreement by the receiving party and otherwise not in violation of the
disclosing party's rights.
5.3 SOURCE CODE PROTECTIONS. Unless as otherwise permitted under this
Agreement or another written agreement between CSC and SDI, CSC shall not under
any circumstances attempt, or knowingly permit others to attempt, to decompile,
decipher, disassemble, reverse engineer or otherwise determine the source code
for the VTB Software.
5.4 CONFIDENTIALITY AGREEMENTS. The receiving party, prior to permitting
access by any individual to any of the disclosing party's confidential
information, shall enter into a confidentiality agreement with each such
individual which (i) incorporates the protections and restrictions set forth
herein for the disclosing party's confidential information; (ii) provides that
the individual's obligations with respect to the disclosing party's confidential
information shall continue after termination of the individual's employment,
consulting relationship or other relationship with the receiving party; and
(iii) provides that the disclosing party is a direct and intended beneficiary of
the agreement and entitled to enforce it directly against the individual.
5.5 NOTIFICATION OF SECURITY BREACH. The receiving party agrees to notify
the disclosing party promptly in the event of any breach of its security under
conditions in which it would appear that the trade secrets contained in the VTB
Software were prejudiced or exposed to loss. The receiving party shall, upon
request of the disclosing party, take all other reasonable steps necessary to
recover any compromised trade secrets disclosed to or placed in the possession
of the receiving party by virtue of this Agreement. The cost of taking such
steps shall be borne solely by the receiving party.
5.6 INJUNCTIVE RELIEF. Each receiving party acknowledges that any breach
of any of its obligations with respect to confidentiality or use of the
disclosing party's confidential information hereunder is likely to cause or
threaten irreparable harm to the disclosing party, and, accordingly, the
receiving party agrees that in the event of such breach the disclosing party
shall be entitled to seek equitable relief to protect its interest therein,
including but not limited to preliminary and permanent injunctive relief, as
well as money damages.
Section 6
REPRESENTATIONS AND WARRANTIES
6.1 WARRANTY OF TITLE. SDI warrants and represents to CSC that (i) CSC
shall acquire good and clear title to the VTB Software, free and clear of all
liens and encumbrances, (ii) all materials and services provided hereunder
including, without limitation, the VTB Software, are either owned or properly
licensed by SDI or are in the public domain and the use thereof by CSC, its
representatives, distributors or dealers will not infringe any proprietary
rights of any third party; provided, however, that SDI's obligations under
Section 7 shall be CSC's sole remedy for any breach of this warranty; and (iii)
SDI has the full power to enter into this Agreement, to carry out its
obligations under this Agreement and to grant the rights and licenses granted to
CSC in this Agreement.
6.2 PRODUCT WARRANTY. SDI warrants the VTB Software under the warranty
set forth in the End User License Agreement.
Section 7
INDEMNIFICATION
7.1 INDEMNIFICATION BY SDI. SDI agrees to indemnify, defend and hold
harmless CSC, its affiliates, and their respective officers, directors,
employees, distributors, agents, successors and assigns from and against any and
all loss, damage, settlement or expense (including reasonable legal expenses),
as incurred, resulting from or arising out of any claims which allege that the
VTB Software or the use or sale thereof infringe upon, misappropriate or violate
any patents, copyrights, or trade secret rights or other proprietary rights of
persons, firms or entities who are not parties to this Agreement; provided that
CSC (i) promptly notifies SDI, in writing, of any notice or claim of such
alleged infringement or misappropriation involving the VTB Software of which it
becomes aware; (ii) permits SDI to control, the defense, settlement, adjustment
or compromise of any such claim; (iii) the claim does not result from
modification of the VTB Software which modification is not authorized by SDI;
and (iv) the claim does not result from the combination of the VTB Software with
software or equipment not provided by SDI if the VTB Software alone would not be
the subject of the claim. CSC may employ counsel, at its own expense (provided
that if such counsel is necessary because SDI does not assume control, SDI will
bear such expense), to assist it with respect to any such claim. CSC shall have
no authority to settle any claim on behalf of SDI.
7.2 INJUNCTION. If by reason of such infringement claim, CSC or its
customers shall be prevented or are likely to be prevented by legal means from
selling or using any VTB Software, or if, in SDI's opinion, such claim is likely
to occur, SDI will use its commercially reasonable efforts, at its
expense, to: (i) obtain all rights required to permit the sale or use of the VTB
Software by CSC; or (ii) modify or replace such VTB Software to make then non-
infringing (and extend this indemnity thereof), provided that any such
replacement or modified VTB is functionally equivalent to the VTB Software. If
SDI is unable to achieve either of the options set forth above within a
reasonable period of time after the issuance of the injunction, or reasonably
believes that an injunction will issue and that such options cannot be achieved
within a reasonable period of time, then neither party will sell or distribute
the VTB Software in accordance with the terms of such injunction-or SDI's
reasonable instructions. Notwithstanding the foregoing, all payments due from
CSC hereunder shall be paid whether or not the VTB Software may be used, sold or
distributed by any of the parties under such injunction or instructions of SDI.
This Section 7 states SDI's entire obligation with respect to claims that the
VTB Software or any rights therein infringe or misappropriate the rights of any
third party.
Section 8
CSC WAVEBRIDGE PRODUCTS
CSC agrees to sell CSC Wavebridge products to SDT's customers who have
purchased VTB Software from SDI. Upon CSC's approval, subject to SDI executing
CSC's standard Sales Representative Agreement, SDI may solicit orders from its
VTB Software customers for CSC Wavebridge products, in which case CSC shall pay
to SDI a commission of forty percent (40%) of the amount received from CSC under
such sale.
Section 9
LIMITATION OF LIABILITY
EXCEPT FOR THE INDEMNIFICATION OBLIGATIONS IN SECTIONS 2.4.2 AND 7, AND THE
CONFIDENTIALITY OBLIGATIONS IN SECTION 5, IN NO EVENT SHALL EITHER PARTY'S
LIABILITY ARISING OUT OF THIS AGREEMENT OR THE TERMINATION OF THIS AGREEMENT
EXCEED THE AMOUNTS PAID BY CSC TO SDI PURSUANT TO THIS AGREEMENT. IN NO EVENT
SHALL EITHER PARTY HAVE ANY LIABILITY FOR ANY INDIRECT, INCIDENTAL, SPECIAL OR
CONSEQUENTIAL DAMAGES, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY, ARISING
OUT OF THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO LOSS OF ANTICIPATED PROFITS,
EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THESE
LIMITATIONS SHALL APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY
LIMITED REMEDY.
Section 10
MISCELLANEOUS
10.1 CONFIDENTIALITY OF AGREEMENT. Both SDI and CSC agree that the terms
and conditions of this Agreement shall be treated as confidential information
and that no reference to the terms and conditions of this Agreement or to
activities pertaining thereto can be made in any form without the prior written
consent of the other party; provided, however, that the general existence of
this Agreement shall not be treated as confidential information and that either
party may disclose the terms and conditions of this Agreement:
(i) as required by any court or other governmental body;
(ii) as otherwise required by law including SDI's obligations under
applicable securities laws;
(iii) to legal counsel of the parties;
(iv) in confidence, to accountants, banks, proposed investors, and
financing sources and their advisors;
(v) in confidence, in connection with the enforcement of this
Agreement or rights under this Agreement; or
(vi) in confidence, in connection with a merger or acquisition or
proposed merger or acquisition, or the like.
10.2 ASSIGNMENT. Neither this Agreement nor any rights, licenses or
obligations hereunder, may be assigned by either party without the prior written
approval of the non-assigning party. Notwithstanding the foregoing, either
party may assign this Agreement to a subsidiary or any acquiror of all or of
substantially all of such party's may assign this Agreement to any acquiror of
all or of substantially all of such party's equity securities, assets or
business relating to the subject matter of this Agreement, except to a direct
competitor of the other party. As a condition to such purported assignment, the
purported assignor shall provide to the other party written confirmation prior
to such assignment of such successor's assumption of this Agreement. Any
attempted assignment in violation of this Section shall be void and without
effect. Subject to the foregoing, this Agreement will benefit and bind the
parties' successors and assigns.
10.3 NOTICES. All notices between the parties shall be in writing and
shall be deemed to have been given if personally delivered or sent by certified
or registered mail (return receipt) or telecopy to the addresses set forth as
follows, or such other address as is provided by notice as set forth herein:
If to SDI to: Summit Design, Inc.
9305 SW Gemini Drive
Beaverton, Oregon 97008
Attn.: Larry J. Gerhard
with a copy to: Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, California 94304-1050
Attn.: Steven Bernard
If to CSC to: Credence Systems Corporation
215 Fourier Avenue Fremont, California 94539
Attn.: Wilmer R. Bottoms
with a copy to: Brobeck, Phleger & Harrison LLP
2200 Geng Road
Palo Alto, California 94303
Attn.: Warren Lazarow
Notices shall be deemed effective upon receipt or, if delivery is not effected
by reason of some fault of the addressee, when tendered.
10.4 RELATIONSHIP OF THE PARTIES. The parties hereto expressly understand
and agree that each party is an independent contractor in the performance of
each and every part of this Agreement, is solely responsible for all of its
employees and agents and its labor costs and expenses arising in connection
therewith. Neither party nor its agents or employees are the representatives of
the other party for any purpose and neither party has the power or authority as
agent, employee or any other capacity to represent, act for, bind or otherwise
create or assume any obligation on behalf of the other party for any purpose
whatsoever.
10.5 IMPORT AND EXPORT. Upon CSC's request, SDI shall provide all
information under its control which is necessary or useful for CSC to obtain any
export or import licenses required for CSC to ship or receive VTB Software,
including, but not limited to, certificates of origin, (NAFTA, etc.),
manufacturer's affidavits, and Buy America qualification, if applicable. This
information is to be provided within ten (10) business days of CSC's request.
10.6 GOVERNING LAW; FORUM SELECTION. This Agreement shall be governed by
the laws of the State of California, without reference to its conflict of laws
principles. All disputes arising out of this Agreement shall be subject to the
exclusive jurisdiction and venue of the California state courts of Santa Clara
County, California (or, if there is exclusive federal jurisdiction, the United
Stated District Court for the Northern District of California), and the parties
consent to the personal and exclusive jurisdiction of these courts.
10.7 SEVERABILITY. Any term or provision of this Agreement held to be
illegal or unenforceable shall, if possible, be interpreted so as to be
construed as valid, but in any event the validity or enforceability of the
remainder hereof shall not be affected.
10.8 EXPORT REGULATIONS. CSC understands that SDI is subject to
regulation by agencies of the U.S. government, including the U.S. Department
of Commerce, which prohibit export or diversion of certain technical products
to certain countries. CSC warrants that it will comply in all respects with
the export and re-export restrictions applicable to the technology and
documentation licensed hereunder.
10.9 WAIVER. The waiver of, or failure to enforce, any breach or default
hereunder shall not constitute the waiver of any other or subsequent breach or
default.
10.10 ENTIRE AGREEMENT. This Agreement, along with the Schedules attached
hereto which are incorporated herein by reference, sets forth the entire
Agreement between the parties and supersedes any and all prior proposals,
agreements, and representations between them, whether written or oral. This
Agreement may be changed only by mutual agreement of the parties in writing.
[Remainder of page intentionally left blank.]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by duly authorized officers or representatives as of the Effective Date.
Software OEM License Agreement - Summit Design Inc. and Credence Systems Corp.
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