SETTLEMENT AND LICENSE AGREEMENT
BY, BETWEEN AND AMONG
AMERIGON, INC.,
AUDIO NAVIGATION SYSTEMS, LLC
ALCOM ENGINEERING CORPORATION
AND
AUDIO NAVIGATION SYSTEMS, INC.
DATED MAY 10, 1996
TABLE OF CONTENTS
1. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.1 "Actions" . . . . . . . . . . . . . . . . . . . 2
1.2 "Affiliate" . . . . . . . . . . . . . . . . . . 2
1.3 "Amerigon Licensed Patents" . . . . . . . . . . 3
1.4 "Amerigon Other Consideration". . . . . . . . . 3
1.5 "Amerigon Selling Price". . . . . . . . . . . . 3
1.6 "Amerigon Sublicensees" . . . . . . . . . . . . 3
1.7 "ANSLC Licensed Patents". . . . . . . . . . . . 4
1.8 "ANSLC Other Consideration" . . . . . . . . . . 4
1.9 "ANSLC Parties" . . . . . . . . . . . . . . . . 4
1.10 "ANSLC Selling Price" . . . . . . . . . . . . . 4
1.11 "ANSLC Sublicensees". . . . . . . . . . . . . . 4
1.12 "Consulting Agreement"......... . . . . . . . . 4
1.13 "Credit Card Processing Agreement". . . . . . . 4
1.14 "Disputed Matters" . . . . . . . . . . . . . . 5
1.15 "Effective Date" . . . . . . . . . . . . . . . 5
1.16 "Gen 4 Agreement" . . . . . . . . . . . . . . . 5
1.17 "Gen 4 Hardware". . . . . . . . . . . . . . . . 5
1.18 "Gen 4 Software". . . . . . . . . . . . . . . . 5
1.19 "Indemnified Parties".... . . . . . . . . . . . 6
1.20 "Interoperable Software". . . . . . . . . . . . 6
1.21 "Issued", "Issuing", "Issues" and "Issuance". . 6
1.22 "Legal Proceeding". . . . . . . . . . . . . . . 6
1.23 "Lunel" . . . . . . . . . . . . . . . . . . . . 6
1.24 "Manufacturing Apparatus" . . . . . . . . . . . 6
1.25 "Navigation-Related Features or Functions". . . 6
1.26 "Option and License Agreement". . . . . . . . . 6
1.27 "Other Consideration" . . . . . . . . . . . . . 6
1.28 "Outsourcing Agreement" . . . . . . . . . . . . 7
1.29 "Passcode Activation Patent". . . . . . . . . . 7
1.30 "Prior Agreements". . . . . . . . . . . . . . . 8
1.31 "Sales Fulfillment / Activation Technology" . . 8
1.32 "Selling Price" . . . . . . . . . . . . . . . . 8
1.33 "Specified Agreements". . . . . . . . . . . . . 9
1.34 "Specified Recoupment". . . . . . . . . . . . . 9
1.35 "Specified Software". . . . . . . . . . . . . . 9
1.36 "Unrelated Third Party" . . . . . . . . . . . . 9
1.37 "VANS Hardware" . . . . . . . . . . . . . . . . 9
1.38 "VANS Navigation Software". . . . . . . . . . . 10
1.39 "VANS Non-Navigation Software". . . . . . . . . 11
1.40 "VANS Product". . . . . . . . . . . . . . . . . 11
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1.41 "VANS Software" . . . . . . . . . . . . . . . . . 11
1.42 "Voice-Interactive" . . . . . . . . . . . . . . . 11
2. PRIOR AGREEMENTS. . . . . . . . . . . . . . . . . . . . . . . . . 11
3. RIGHTS TO EXISTING TECHNOLOGY . . . . . . . . . . . . . . . . . . 12
3.1 DELIVERY OF EXISTING VOICE FILES . . . . . . . . 12
3.2 DELIVERY OF SALES FULFILLMENT / ACTIVATION
TECHNOLOGY. . . . . . . . . . . . . . . . . . . . . . . 12
3.3 COVENANTS NOT TO ▇▇▇ . . . . . . . . . . . . . . 12
3.3.1 BY AMERIGON . . . . . . . . . . . . . 12
3.3.2 BY ANSLC. . . . . . . . . . . . . . . 13
3.4 LIMITATION ON ANSLC'S RIGHTS TO GEN 4. . . . . . 13
3.5 LIMITATIONS ON AMERIGON'S RIGHTS . . . . . . . . 13
3.6 OWNERSHIP OF PROPRIETARY RIGHTS IN EXISTING
TECHNOLOGY . . . . . . . . . . . . . . . . . . . . . . 13
3.6.1 GENERAL . . . . . . . . . . . . . . . 13
3.6.2 ANSI OWNERSHIP. . . . . . . . . . . . 14
3.6.3 AMERIGON OWNERSHIP. . . . . . . . . . 14
3.6.4 JOINT OWNERSHIP.. . . . . . . . . . . 14
3.7 OWNERSHIP OF TRADEMARKS. . . . . . . . . . . . . 14
3.7.1 IVS TRADEMARK . . . . . . . . . . . . 14
3.7.2 VANS TRADEMARK. . . . . . . . . . . . 15
. . . . . . . . . . . . . . . . . . . . . . 15
3.8 NO WARRANTIES RE TECHNOLOGY. . . . . . . . . . . 15
4. INDEMNIFICATIONS. . . . . . . . . . . . . . . . . . . . . . . . . 15
4.1 THIRD PARTY CLAIMS AGAINST THE ANSLC
PARTIES . . . . . . . . . . . . . . . . . . . . . . . . 15
4.2 THIRD PARTY CLAIMS AGAINST AMERIGON. . . . . . . 16
4.3 LIMITATIONS. . . . . . . . . . . . . . . . . . . 16
5. CREATION OF ADDITIONAL VOICE FILES. . . . . . . . . . . . . . . . 16
5.1 ENGAGING LUNEL . . . . . . . . . . . . . . . . . 16
5.2 COSTS OF PRODUCING VOICE FILES . . . . . . . . . 17
5.3 ROYALTIES................. . . . . . . . . . . . 17
5.4 OWNERSHIP AND LICENSING OF VOICE FILES . . . . . 17
6. PATENT LICENSE FROM ANSLC TO AMERIGON . . . . . . . . . . . . . . 18
6.1 GENERAL. . . . . . . . . . . . . . . . . . . . . 18
6.2 PASSCODE ACTIVATION PATENT . . . . . . . . . . . 18
6.3 EXTENSION OF LICENSE TO AFFILIATES AND
SUBLICENSEES. . . . . . . . . . . . . . . . . . . . . . 18
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7. PATENT LICENSE FROM AMERIGON TO ANSLC . . . . . . . . . . . . . . 18
7.1 GENERAL. . . . . . . . . . . . . . . . . . . . . 18
7.2 EXTENSION OF LICENSE TO AFFILIATES AND
SUBLICENSEES. . . . . . . . . . . . . . . . . . . . . . 19
8. PATENT NOTICES. . . . . . . . . . . . . . . . . . . . . . . . . . 19
9. DISCLOSURE OF PATENTS . . . . . . . . . . . . . . . . . . . . . . 19
10. EXPENSES OF PATENT PROSECUTION. . . . . . . . . . . . . . . . . . 19
11. PATENT LITIGATION AND APPORTIONMENT OF RECOVERY . . . . . . . . . 20
11.1 EACH PARTY RESPONSIBLE FOR PROTECTION OF ITS
PATENTS . . . . . . . . . . . . . . . . . . . . . . . . 20
11.2 RIGHT TO SHARE LITIGATION EXPENSES AND
APPORTIONMENT OF RECOVERIES . . . . . . . . . . . . . . 20
12. ROYALTIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
12.1 ROYALTIES PAYABLE BY ANSLC . . . . . . . . . . . 21
12.1.1 HARDWARE. . . . . . . . . . . . . . . 21
12.1.2 SOFTWARE AND ANSLC OTHER
CONSIDERATION . . . . . . . . . . . . . . . . . 21
12.2 ROYALTIES PAYABLE BY AMERIGON. . . . . . . . . . 22
12.2.1 HARDWARE. . . . . . . . . . . . . . . 22
12.2.2 SOFTWARE AND AMERIGON OTHER
CONSIDERATION. . . . . . . . . . . . . . . . . . 23
12.3 EXPIRATION OF PAYMENT OBLIGATIONS. . . . . . . . 24
12.4 RESPONSIBILITY FOR AFFILIATES AND SUBLICENSEES . 24
12.4.1 ANSLC RESPONSIBILITY FOR
ANSLC AFFILIATES AND SUBLICENSEES. . . . . . . . 24
12.4.2 AMERIGON RESPONSIBILITY FOR
AMERIGON AFFILIATES AND SUBLICENSEES . . . . . . 24
13. ACCRUALS, RECORDS AND REPORTS . . . . . . . . . . . . . . . . . . 24
13.1 ACCRUAL OF ROYALTIES . . . . . . . . . . . . . . . 24
13.2 STATEMENTS . . . . . . . . . . . . . . . . . . . . 25
13.3 LATE CHARGES . . . . . . . . . . . . . . . . . . . 25
13.4 FORM OF PAYMENTS . . . . . . . . . . . . . . . . . 25
13.5 CERTIFICATION. . . . . . . . . . . . . . . . . . . 25
13.6 RECORDS. . . . . . . . . . . . . . . . . . . . . . 26
13.7 TAXES. . . . . . . . . . . . . . . . . . . . . . . 27
14. SECURITY INTERESTS. . . . . . . . . . . . . . . . . . . . . . . . 27
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15. LIMITATIONS ON PUBLIC STATEMENTS. . . . . . . . . . . . . . . . . 28
15.1 GENERAL. . . . . . . . . . . . . . . . . . . . . 28
15.2 EXCEPTIONS AND EXCLUSIONS. . . . . . . . . . . . 29
15.3 PRESS RELEASE. . . . . . . . . . . . . . . . . . 29
16. RELEASES: DISMISSAL OF LEGAL PROCEEDING . . . . . . . . . . . . . 29
16.1 RELEASE BY AMERIGON. . . . . . . . . . . . . . . 29
16.2 RELEASE BY ANSLC PARTIES . . . . . . . . . . . . 30
16.3 STIPULATION FOR DISMISSAL OF LITIGATION. . . . . 31
16.4 COMPROMISE ONLY. . . . . . . . . . . . . . . . . 31
17. REPRESENTATIONS . . . . . . . . . . . . . . . . . . . . . . . . . 32
17.1 MUTUAL REPRESENTATIONS . . . . . . . . . . . . . 32
17.2 REPRESENTATIONS BY ANSLC PARTIES . . . . . . . . 32
17 3 LIMITATIONS AND EXCLUSIONS . . . . . . . . . . . 32
18. CONFIDENTIALITY OBLIGATIONS . . . . . . . . . . . . . . . . . . . 32
19. DISPUTE RESOLUTION. . . . . . . . . . . . . . . . . . . . . . . . 33
19.1 GENERAL. . . . . . . . . . . . . . . . . . . . . 33
19.2 DISPUTE ESCALATION . . . . . . . . . . . . . . . 34
19.3 RESOLUTION OF DISPUTES RE SELLING PRICE ALLOCATION ISSUES. . 34
19.3.1 SELECTION OF ARBITRATOR. . . . . . . 34
19.3.2 HEARING AND RESOLUTION . . . . . . . 35
19.3.3 EXPENSES . . . . . . . . . . . . . . 35
19.4 ARBITRATION. . . . . . . . . . . . . . . . . . . 36
19.5 GENERAL PROVISIONS RE ARBITRATION. . . . . . . . 36
20. APPRAISAL OF FAIR MARKET VALUE. . . . . . . . . . . . . . . . . . 37
21. TERM OF LICENSE RIGHTS: LIMITATION OF REMEDIES. . . . . . . . . . 37
21.1 TERM OF LICENSE RIGHTS . . . . . . . . . . . . . 37
21.2 NO INJUNCTIVE RELIEF . . . . . . . . . . . . . . 38
22. PAYMENTS TO NAVTECH AND LERNOUT & HAUSPIE AND OTHER THIRD
PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
23. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
24. COMPATIBILITY / INTEROPERABILITY. . . . . . . . . . . . . . . . . 39
24.1 VANS NON-NAVIGATION SOFTWARE . . . . . . . . . . 39
24.2 VANS NAVIGATION SOFTWARE . . . . . . . . . . . . 39
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24.3 TRANSFERABILITY OF RIGHTS. . . . . . . . . . . . 39
24.4 LIMITED TECHNICAL SUPPORT. . . . . . . . . . . . 40
24.5 ROYALTY ADJUSTMENT . . . . . . . . . . . . . . . 40
25. OPERATION OF TOLL-FREE 800 NUMBER; OUTSOURCING AGREEMENT . . . . . 41
25.1 RIGHT START AGREEMENT. . . . . . . . . . . . . . 41
25.2 CREDIT CARD PROCESSING AGREEMENT . . . . . . . . 41
26. CUSTOMER LISTS . . . . . . . . . . . . . . . . . . . . . . . . . . 42
27. RELATIONSHIP OF PARTIES. . . . . . . . . . . . . . . . . . . . . . 42
28. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . . . . . . . . . 42
28.1 NOTICES AND COMMUNICATIONS . . . . . . . . . . . 42
28.2 EXCUSED PERFORMANCE. . . . . . . . . . . . . . . 43
28.3 ASSIGNMENT . . . . . . . . . . . . . . . . . . . 43
28.4 INTEGRATION. . . . . . . . . . . . . . . . . . . 44
28.5 MODIFICATION . . . . . . . . . . . . . . . . . . 44
28.6 WAIVER OR DELAY. . . . . . . . . . . . . . . . . 44
28.7 SEVERABILITY . . . . . . . . . . . . . . . . . . 44
28.8 SURVIVAL . . . . . . . . . . . . . . . . . . . . 44
28.9 GOVERNING LAW. . . . . . . . . . . . . . . . . . 44
28.10 HEADINGS . . . . . . . . . . . . . . . . . . . . 45
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SETTLEMENT AND LICENSE AGREEMENT
This Settlement and License Agreement (the "Agreement") is made and
entered into this 9th day of May, 1996, by and between Amerigon, Inc., a
California corporation ("Amerigon"); Audio Navigation Systems, Inc., a
California corporation ("ANSI"); Audio Navigation Systems, LLC, a California
limited liability corporation ("ANSLC"); and Alcom Engineering Corporation,
a California corporation ("Alcom"), with reference to the following facts:
A. Amerigon and ANSI are parties to an Option and License Agreement
dated as of July 13, 1992.
B. Amerigon, ANSI and Alcom Engineering Corporation are parties to a
Consulting Agreement dated as of July 13, 1992.
C. Certain disputes have arisen between Amerigon and ANSI relating,
INTER ALIA, to their respective rights and obligations under the July 13, 1992
Option and License Agreement and the July 13, 1992 Consulting Agreement.
D. On May 17, 1995, Amerigon filed a complaint in Superior Court,
County of Los Angeles, State of California, AMERIGON. INC. v. AUDIO NAVIGATION
SYSTEMS, INC. ET AL., Case No. BC127921, and on June 1, 1995, Amerigon filed a
First Amended Complaint for Declaratory Relief in that action. On or about July
1, 1995, ANSI filed a General Denial and a Cross-Complaint for Declaratory
Relief in that action.
E. Subsequent to the commencement of the legal action described in
Paragraph D above, ANSI and Amerigon entered into an Agreement Re Gen 4
Navigation System dated July 24, 1995, which was amended by an Amendment dated
as of August 14, 1995.
F. Certain disputes have arisen between Amerigon and ANSI relating to
their respective rights and obligations under the July 24, 1995 Agreement Re Gen
4 Navigation System as amended by the August 14, 1995 Amendment.
G. Amerigon, on the one hand, and the ANSLC Parties, on the other hand,
wish fully and finally to resolve all differences, claims, demands, causes of
action and disputes of whatever nature or subject matter between them, including
but not limited to all disputes and claims arising out of any of the facts,
transactions and occurrences alleged in or in connection with the legal action
described in Paragraph D above and all disputes and claims arising out of or
relating to the July 13, 1992 Option and License Agreement, the July 13,
1992 Consulting Agreement and/or the July 24, 1995 Agreement Re Gen 4 Navigation
System, as amended by the August 14, 1995 Amendment.
1
H. All or substantially all of ANSI's rights in and to the technology,
patents and business that are the subject of this Agreement have been or will
be assigned to ANSLC.
I. Amerigon, on the one hand, and ANSI and ANSLC, on the other hand,
desire, pursuant to the terms and conditions set forth herein, to grant one
another certain rights and make certain commitments not to assert claims
against one another in the future in an effort to lessen the likelihood of
future disputes between the parties and to permit the parties to conduct their
respective businesses.
NOW THEREFORE, in consideration of the foregoing, and in consideration
of the representations, warranties and covenants set forth in this Agreement,
ANSI, ANSLC, Alcom and Amerigon agree as follows:
ALTHOUGH THIS AGREEMENT IS BEING EXECUTED ON MAY 10, 1996, THE PARTIES
AGREE THAT THIS AGREEMENT SHALL NOT BE BINDING OR EFFECTIVE UNLESS AND UNTIL
ANSLC CONCLUDES AN AGREEMENT WITH NAVTECH REASONABLY ACCEPTABLE TO ANSLC
GRANTING ANSLC LICENSE RIGHTS IN THE NAVTECH TECHNOLOGY COMPARABLE TO
THOSE HELD BY AMERIGON. IN THE EVENT NO SUCH AGREEMENT BETWEEN NAVTECH AND
ANSLC IS ENTERED INTO, THIS AGREEMENT SHALL BE VOID AND OF NO FORCE OR EFFECT,
EXCEPT THAT THIS PARAGRAPH AND SECTION 3.1 SHALL BE BINDING UPON THE PARTIES.
ANSLC SHALL NEGOTIATE IN GOOD FAITH IN AN EFFORT TO REACH AN AGREEMENT WITH
NAVTECH CONSISTENT WITH THE CORRESPONDENCE AND PROPOSALS HERETOFORE
EXCHANGED BETWEEN NAVTECH AND ANSLC. UPON EXECUTION OF SUCH AN AGREEMENT
BETWEEN NAVTECH AND ANSLC, ANSLC SHALL PROMPTLY NOTIFY AMERIGON IN
WRITING, AND AMERIGON AND ANSLC SHALL EXECUTE AN ADDENDUM CONFIRMING THAT THIS
AGREEMENT IS IN FULL FORCE AND EFFECT. THE DATE OF EXECUTION OF SUCH AN
AGREEMENT BETWEEN NAVTECH AND ANSLC SHALL BE THE "EFFECTIVE DATE" OF THIS
AGREEMENT. IN THE EVENT THE EFFECTIVE DATE HAS NOT OCCURRED ON OR BEFORE JUNE
15, 1996: (i) THERE SHALL NOT BE AN EFFECTIVE DATE OF THIS AGREEMENT, UNLESS THE
PARTIES MUTUALLY AGREE IN WRITING TO THE CONTRARY; AND (ii) THIS PARAGRAPH AND
SECTION 3.1 SHALL BE THE ONLY PROVISIONS OF THIS AGREEMENT BINDING UPON THE
PARTIES.
1. DEFINITIONS. As used in this Agreement, the following terms shall have the
following meanings:
1.1 "Actions" shall mean any allegations, claims, suits,
arbitrations, actions, or proceedings.
1.2 "Affiliate" shall mean, with respect to any applicable
party referred to in this Agreement, any corporation, limited liability
company, partnership or other entity (collectively, an "Entity") of
which such party (a) has legal, beneficial or equitable ownership, directly or
indirectly, or the right to acquire legal, beneficial or equitable ownership,
directly
2
or indirectly, of forty percent (40%) or more of the aggregate of all equity
interests in such Entity (no matter how evidenced) or (b) has legal, beneficial
or equitable ownership, directly or indirectly, or the right to acquire legal,
beneficial or equitable ownership, directly or indirectly, of forty percent
(40%) or more of the interests (no matter how evidenced) having the power to
direct the affairs of such Entity by reason of ownership of voting stock,
contract or otherwise; or (c) is directly or indirectly controlling, controlled
by or under common control with such applicable party. Without limiting
the foregoing definition, ANSI, ANSLC and Amerigon each agrees not to create any
Entity that does not meet the definition of an Affiliate hereunder for the
principal purpose of circumventing or frustrating the respective rights,
obligations and intentions of the parties as set forth in this Agreement.
Further without limiting the foregoing definition, the parties agree that ANSI
shall be deemed an Affiliate of ANSLC.
1.3 "Amerigon Licensed Patents" shall mean all patents (not
including any design patents) Issued or Issuing on patent applications entitled
to an effective filing date prior to May 10, 1998, for which, (a) at May 10,
1996, Amerigon or an Amerigon Affiliate is an actual or beneficial owner or an
assignee, or (b) at the date of the invention, the date of reduction to practice
or May 10, 1996 any named inventor was employed by Amerigon or an Amerigon
Affiliate or engaged by Amerigon or an Amerigon Affiliate pursuant to an
agreement requiring that the inventor assign patent rights in such invention to
Amerigon or an Amerigon Affiliate. The term "Amerigon Licensed Patents" shall
also include any patent which is a reissue or extension of any of the foregoing,
and any patent issuing on any patent application related as a divisional or a
continuation or a continuation-in-part of any of the foregoing. Without
limiting the foregoing, Amerigon Licensed Patents include those patents
identified in Schedule 1.3 attached hereto.
1.4 "Amerigon Other Consideration" means any Other
Consideration received by Amerigon or an Amerigon Affiliate.
1.5 "Amerigon Selling Price" shall mean the Selling Price at which a
VANS Product is sold, leased, licensed, made available or otherwise exploited by
Amerigon, an Amerigon Affiliate or an Amerigon Sublicensee to a third party
other than Amerigon, an Amerigon Affiliate, an Amerigon Sublicensee or an
Affiliate of an Amerigon Sublicensee.
1.6 "Amerigon Sublicensees" shall mean any person or entity to which
Amerigon grants any rights to make, or have made VANS Products or to practice or
have practiced any method or process involved in the manufacture or use thereof;
or to make, have made or use Manufacturing Apparatus or practice or have
practiced any method or process involved in the manufacture or use
3
thereof; or to use, lease, sell or otherwise transfer VANS Products;
1.7 "ANSLC Licensed Patents" shall mean all patents (not including
any design patents), Issued or Issuing on patent applications entitled to
an effective filing date prior to May 10, 1998, for which, (a) at May 10, 1996,
ANSLC or an ANSLC Affiliate is an actual or beneficial owner or an assignee, or
(b) at the date of the invention, the date of reduction to practice or May 10,
1996 any named inventor was employed by ANSLC or an ANSLC Affiliate or engaged
by ANSLC or an ANSLC Affiliate pursuant to an agreement requiring that the
inventor assign patent rights in such invention to ANSLC or an ANSLC Affiliate.
The term "ANSLC Licensed Patents" shall also include any patent which is a
reissue or extension of any of the foregoing, and any patent issuing on
any patent application related as a divisional or a continuation or a
continuation-in-part of any of the foregoing. Without limiting the foregoing,
ANSLC Licensed Patents include those Issued patents identified in Schedule 1.7
attached hereto, and patents hereafter Issuing on those patent applications
identified in Schedule 1.7.
1.8 "ANSLC Other Consideration" means any Other Consideration
received by ANSLC or an ANSLC Affiliate.
1.9 "ANSLC Parties" means, individually and collectively,
ANSI, ANSLC and Alcom.
1.10 "ANSLC Selling Price" shall mean the Selling Price at which a
VANS Product is sold, licensed or otherwise made available or exploited
by ANSLC, an ANSLC Affiliate or an ANSLC Sublicensee to a third party other than
ANSLC, an ANSLC Affiliate, an ANSLC Sublicensee or an Affiliate of an ANSLC
Sublicensee.
1.11 "ANSLC Sublicensees" shall mean any person or entity to which
ANSLC grants any rights to make, or have made VANS Products or to practice or
have practiced any method or process involved in the manufacture or use
thereof; or to make, have made or use Manufacturing Apparatus or practice or
have practiced any method or process involved in the manufacture or use
thereof; or to use, lease, sell or otherwise transfer VANS Products;
1.12 "Consulting Agreement" shall mean the Consulting Agreement dated
as of July 13, 1992 between and among Amerigon, ANSI and Alcom Engineering
Corporation.
1.13 "Credit Card Processing Agreement" shall mean the agreement
dated August 22, 1995 between ANSI and First U.S.A./DMGT pursuant to which First
U.S.A./DMGT has certain obligations with respect to the processing of credit
card transactions for sales of certain Gen 4 Software.
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1.14 "Disputed Matters" shall mean all disputes, controversies
or conflicts between any of the ANSLC Parties, on the one hand, and Amerigon, on
the other hand, relating to any of the Specified Agreements and all disputes,
controversies or conflicts which are the subject of the Legal Proceeding.
1.15 "Effective Date" shall have the meaning specified on the first
page of this agreement, in the paragraph immediately preceding Section 1.
1.16 "Gen 4 Agreement" shall mean the Agreement Re Gen 4 Navigation
System dated July 24, 1995 between ANSI and Amerigon, as amended by the
Amendment dated as of August 14, 1995 between ANSI and Amerigon.
1.17 "Gen 4 Hardware" shall mean VANS Hardware consisting of a
printed circuit board and electronic components and connectors, cables,
housings, firmware and other tangible hardware in substantially the form that
exists as of the date of this Agreement for anticipated delivery by
Amerigon to Amerigon's customers such as Kenwood, Alpine, Clarion and Eclipse.
VANS Hardware shall be deemed to constitute Gen 4 Hardware if (a) such hardware
includes a system architecture that uses a Digital Signal Processor from Analog
Devices (#21MSP55) and a Motorola Central Processing Unit (#68340) (or backward
compatible direct successors thereto or a second-source chips generally
recognized in the industry as clones of such chips or clones of backward
compatible successors thereto) or (b) such hardware is characterized by the DSP,
operating as a slave to the CPU, being used for speech recognition and
speech generation; the CPU being used for CD data retrieval, navigation
calculations, and system control; the DSP receiving the data and program
code necessary for speech recognition and speech generation from a DRAM
accessible indirectly through the CPU; the DSP having dedicated SRAM for its
"scratch" calculations; and a ROM from which program code necessary to start the
system upon power-on is executed from the CPU. Gen 4 Hardware also includes
minor modifications to the foregoing that are intended to reduce cost or
to resolve technical problems or to improve performance, provided that the
hardware modifications do not change the fundamental system architecture of the
foregoing. Gen 4 Hardware expressly excludes any VANS Hardware that utilizes a
single chip that combines the functions of the Digital Signal Processor and the
Central Processing Unit.
1.18 "Gen 4 Software" shall mean operating system and application
Software for the Gen 4 Hardware which, when used on the Gen 4 Hardware,
provides Voice-Interactive Navigation-Related Features or Functions. The Gen
4 Software may include, without limitation, operating system software,
application programs, hardware device drivers for interfacing with audio CD
players and/or maps, including points of interest.
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1.19 "Indemnified Parties" shall mean with respect to any party,
such party and its Affiliates, and their respective officers, directors,
agents and employees.
1.20 "Interoperable Software" shall have the meaning specified
in Section 24.1.
1.21 "Issued", "Issuing", "Issues" and "Issuance" shall refer to the
awarding of a patent based upon a patent application, whether such awarding
is affected by issuance, registration, deliverance, sealing, granting or any
other act.
1.22 "Legal Proceeding" shall mean the proceeding in Superior
Court, County of Los Angeles, State of California, AMERIGON INC. V.
AUDIO NAVIGATION SYSTEMS, INC. ET AL., Case No. BC127921.
1.23 "Lunel" shall mean Roy Lunel.
1.24 "Manufacturing Apparatus" shall mean any instrumentality
or aggregate of instrumentalities primarily designed for use in the
fabrication of a VANS Product.
1.25 "Navigation-Related Features or Functions" shall mean any
features or functions that facilitate any one or more of the following: (a)
determining and/or communicating to the user his/her current geographic
position; (b) determining and/or communicating to the user what course to
follow or how to navigate from one geographic location to another; (c)
determining and/or communicating to the user the position of a geographic
location of interest; or (d) otherwise utilizing map databases or geographic
databases to determine and/or communicate to the user information relating to
geographic location or position.
1.26 "Option and License Agreement" shall mean the Option and License
Agreement dated as of July 13, 1992 between Amerigon and ANSI.
1.27 "Other Consideration" shall mean any and all consideration
other than the Selling Price received by an applicable person or entity
in connection with the marketing, licensing, sale or other commercial
exploitation of the VANS Products or the Licensed Patents, regardless
of the form or characterization of such consideration, including
without limitation advances, one-time payments, stock or equity interests,
profit participations, assets, development or consulting fees, tooling
fees, advertising or promotional payments and any other form of compensation or
consideration, provided that, in the event an applicable entity sells a stock or
equity interest in connection with the marketing, licensing, sale or
other commercial exploitation of the VANS Products or the Licensed Patents,
"Other Consideration" shall include only that portion, if any, of the
6
consideration received for such stock or equity interest which exceeds the fair
market value of such stock or equity interest as of the date of such
transaction. The parties' intention in providing for Other Consideration to
include the above fair market portion of any value paid for a stock or
equity interest in connection with the marketing, licensing, sale or other
commercial exploitation of the VANS Products or the Licensed Patents is to
circumvent a party's ability to structure a transaction in order to avoid
payments to the other party hereunder simply by characterizing a payment
as part of the consideration received for a stock or equity interest rather than
as a license fee. By way of example only, if an entity licenses rights to one
or more VANS Products or Licensed Patents in a transaction in which such entity
receives (i) consulting fees; (ii) support fees; (iii) a one-time payment; and
(iv) an equity investment in which the licensee acquires a portion of the
stock of such entity, Other Consideration would include the consulting fees, the
support fees, the one-time payment and any portion of the amount paid for the
stock of such entity which exceeds the fair market value of the stock as of the
date of purchase. Any dispute over what portion of consideration paid for a
stock or equity interest exceeds the fair market value of such stock or equity
interest shall be resolved as set forth in Section 20. Further, in the
event that a VANS Product is incorporated into a larger product, and there
are no bona fide separately stated prices for the VANS Product and the non-VANS
portion of the larger product, the allocation of what portion of the Other
Consideration is attributable to the VANS Product and the non-VANS portion of
the larger product for the purpose of calculating payments hereunder shall
be made based on a reasonable good faith apportionment of the value of the VANS
Product and the value of the non-VANS portion of the larger product, where the
value of the VANS product is based upon the value added to the non-VANS portion
of the larger product by the VANS Product to Unrelated Third Party purchasers at
the distribution level at which sales to Unrelated Third Party Purchasers
actually occur.
1.28 "Outsourcing Agreement" shall mean the agreement dated October
1, 1995 between ANSI and The Right Start, Inc. pursuant to which The
Right Start, Inc. has certain obligations with respect to the operation of a
toll-free 800 number, and the providing of telemarketing, direct mail and
order fulfillment services for sales of certain Gen 4 Software.
1.29 "Passcode Activation Patent" shall mean all patents, if any,
Issued or Issuing on (a) the patent application(s) identified in Schedule
1.29 and any foreign filings thereon, or (b) any other patent applications
filed with respect to the Sales Fulfillment / Activation Technology,
including any patent which is a reissue or extension of any of the foregoing,
and any patent issuing on any such patent application(s) related as a divisional
or a continuation or a continuation-in-part of any of the foregoing.
7
1.30 "Prior Agreements" shall have the meaning specified in Section
2.
1.31 "Sales Fulfillment / Activation Technology" shall mean the
method and process utilized by ANSI for decryption and activation of Gen 4
Software and the program code utilized by ANSI to implement such method and
process.
1.32 "Selling Price" shall mean, with respect to any applicable
person or entity, the bona fide gross invoiced billing price at which a VANS
Product is sold, leased, licensed or otherwise made available or exploited
by such entity, less the following: (i) promotional, refund, returns or similar
credits or rebates which are actually granted or credited against amounts
invoiced; and (ii) any federal, state or foreign sales, excise or other taxes or
tariffs imposed on the licensing, manufacture and/or distribution of VANS
Products (not including taxes based on income). If said billing price
includes the following items, they may be deducted only if separately stated:
packing, transportation and insurance charges Commissions and costs payable
to sales representatives shall not be deductible from the gross invoiced billing
price for purposes of calculating the Selling Price. If a VANS Product includes
both VANS Hardware and VANS Software, and there are no BONA FIDE separately
stated prices for the VANS Hardware and the VANS Software incorporated in such
VANS Product, the allocation of what portion of the Selling Price is
attributable to the VANS Hardware and what portion is attributable to the VANS
Software for purposes of calculating payments hereunder shall be made based on
(i) the ratio of the average selling price or license fee charged by the
entity selling, leasing, licensing, making available or otherwise exploiting
the VANS Product for separate transactions with respect to the VANS Hardware and
VANS Software contained in such VANS Product during the same quarterly period
(or the most recent quarterly period in which sales or licenses have occurred),
if such products are or were sold or licensed separately, or (ii) in
the event the VANS Hardware and VANS Software contained in such VANS
Product are not and were not sold or licensed separately, such allocation
shall be based on a reasonable good faith apportionment of the relative
values, to Unrelated Third Party purchasers at the distribution level at which
sales to Unrelated Third Party Purchasers actually occur, of the VANS Hardware
and VANS Software comprising said VANS Product and the relative prices that
could be charged for such products if sold, leased, licensed, made available
or otherwise exploited separately. Further, in the event that a VANS
Product is incorporated into a larger product, and there are no bona fide
separately stated prices for the VANS Product and the non-VANS portion of the
larger product, the allocation of what portion of the Selling Price is
attributable to the VANS Product and the non-VANS portion of the larger product
shall be a reasonable good faith apportionment of the value of the VANS Product
and the value of
8
the non-VANS portion of the larger product, where the value of the VANS Product
is based upon the value added to the non-VANS portion of the larger product by
the VANS Product to Unrelated Third Party purchasers at the distribution level
at which sales to Unrelated Third Party Purchasers actually occur. By way of
example only, if a VANS product is incorporated into a larger CD product, where
the sales price (at the appropriate distribution level) of comparable non-VANS
CD products is $300 and the sales price of the larger, integrated product is
$450, the apportionment of value to the VANS product would be $150,
notwithstanding whatever price might by sought or paid for separately priced
stand-alone VANS products. Also by way of example only, in the event a VANS
Product consisting of a chipset is sold by ANSLC, an ANSLC Affiliate or an ANSLC
Sublicensee to an Unrelated Third Party for integration by such third party into
a consumer product, the Selling Price would be the Selling Price for such
chipset.
1.33 "Specified Agreements" shall mean the Consulting Agreement, the
Option and License Agreement, and the Gen 4 Agreement.
1.34 "Specified Recoupment" shall have the meaning specified in
Section 12.1.2.1.
1.35 "Specified Software" shall mean any software, including
without limitation operating system software, application programs, hardware
device drivers for interfacing with audio CD players, and/or maps, irrespective
of the form or medium in which such software is embodied, including
magnetic and/or optical storage media, CD-ROMs, firmware, and any other media
now known or hereafter invented, which software is created by or for ANSLC,
Amerigon, an ANSLC Affiliate or an Amerigon Affiliate or which is created,
manufactured, distributed, used or sold pursuant to license or
authorization from ANSLC, Amerigon, an ANSLC Affiliate or an Amerigon Affiliate.
1.36 "Unrelated Third Party" shall mean, as to Amerigon, any person or
entity other than Amerigon, an Amerigon Affiliate, an Amerigon Sublicensee or an
Affiliate of an Amerigon Sublicensee, and as to ANSLC shall mean any person or
entity other than ANLSC, an ANSLC Affiliate, an ANSLC Sublicensee or an
Affiliate of an ANSLC Sublicensee.
1.37 "VANS Hardware" shall mean (i) any hardware meeting all of the
criteria set forth in subparagraphs (a), (b), (c) and (d) below, or (ii) any
hardware that, in the form sold to end-user customers (including any software
resident in firmware on such hardware or otherwise provided or bundled with such
hardware) would be deemed to infringe or contributorily infringe United States
patent #5,274,560 if manufactured or sold without a license to such patent,
irrespective of whether such hardware meets the criteria set forth in
subparagraphs (a), (b), (c) and (d) below:
9
(a) The hardware (when used with software resident in firmware on
such hardware or otherwise provided for use with such hardware) is capable of
providing Voice-Interactive Navigation-Related Features or Functions, whether
or not such hardware also provides other features or functions;
(b) Substantially all of (i) the computing and memory storage
functions or (ii) the digital processing and memory storage functions
associated with the providing of Voice-Interactive Navigation-Related
Features or Functions are performed locally, in the hardware unit itself, and
not remotely. By way of example only, a cellular phone or other device
through which navigation information is communicated to a user would not be
deemed to constitute VANS Hardware where such device does not provide
substantially all of the computing and memory storage functions associated
with the providing of Voice-Interactive Navigation-Related Features or
Functions but merely communicates to the user navigation information
originating from a remote system.
(c) The designs or specifications for the hardware were created in
substantial and material part by or for ANSLC, Amerigon, an ANSLC Affiliate
or an Amerigon Affiliate or were designed, manufactured, distributed, used or
sold pursuant to license or authorization from ANSLC, Amerigon, an ANSLC
Affiliate or an Amerigon Affiliate. By way of example only, if ANSLC or
Amerigon is a value-added reseller for hardware designed in part by a third
party, and ANSLC or Amerigon, as applicable, contributes substantial and
material modifications to such third party hardware design, the designs or
specifications for such hardware will be deemed to have been created in
substantial and material part by or for ANSLC or Amerigon, as applicable.
(d) The hardware was designed in substantial part and is marketed in
substantial part for the purpose of providing Voice-Interactive Navigation-
Related Features or Functions (when used with software resident in firmware on
such hardware or otherwise provided for use with such hardware).
Notwithstanding anything to the contrary set forth in this Section 1.37, a
general purpose personal computer running a standard, generally available,
general-purpose operating system or operating environment and capable of
running a wide range of applications programs (E.G., an operating
system/environment such as MS-DOS, Windows, UNIX, Macintosh OS and similar
operating systems/environments) shall not constitute VANS Hardware.
1.38 "VANS Navigation Software" shall mean any Specified Software
that enables Voice-Interactive Navigation-Related Features or Functions,
which software either:
(a) is designed for operation on VANS Hardware; or
10
(b) is designed for operation on hardware that
(i) does not constitute VANS Hardware; and
(ii) performs substantially all of (a) the computing and memory
storage functions or (b) the digital processing and memory
storage functions associated with the providing of Voice-
Interactive Navigation-Related Features or Functions are
performed locally, in the non-VANS Hardware unit itself, and
not remotely.
By way of example only, in the case of software created by ANSLC or Amerigon
that enables Voice-Interactive Navigation-Related Features or Functions and
that is designed and marketed for operation on a general purpose laptop PC
running MS-DOS/Windows, where such laptop PC performs substantially all of
the computing and memory storage functions associated with the providing of
Voice-Interactive Navigation-Related Features or Functions locally, such
software would be deemed VANS Navigation Software and such laptop PC would
not be deemed VANS Navigation Hardware.
1.39 "VANS Non-Navigation Software" shall mean any Specified
Software that (a) is designed and marketed for operation on VANS Hardware and
(b) does not provide Navigation-Related Features or Functions. By way of
example only, software designed and marketed for operation on VANS Hardware
to play blackjack or other games which does not provide Navigation-Related
Features or Functions would constitute VANS Non-Navigation Software.
1.40 "VANS Product" shall mean any item of VANS Hardware or VANS
Software.
1.41 "VANS Software" shall mean any VANS Navigation Software and
any VANS Non-Navigation Software. For purposes of determining the percentage
royalty payable pursuant to Section 12.1 or 12.2, VANS Software shall be
considered part of the VANS Hardware (and therefore be subject to the two
percent (2%) royalty percentage) if such VANS Software is (a) embedded on
firmware in VANS Hardware, and (b) consists solely of operating system
software and/or device drivers and not applications programs.
1.42 "Voice-Interactive" shall mean, with respect to any system, a
system that responds to human vocal utterances and communicates to the user
via speech (whether such speech is synthesized, recorded or otherwise
generated by any process or method now known or hereafter invented).
2. PRIOR AGREEMENTS. All agreements, negotiations, representations and
obligations which may now be in effect between ANSI and Amerigon, including
without limitation the Specified
11
Agreements (collectively the "Prior Agreements"), whether oral or written,
and whether or not relating specifically to the Disputed Matters or the
subject matter of this Agreement, and whether or not specifically referred to
herein, are hereby terminated and superseded by this Agreement, except to the
extent set forth in Schedule 2.
3. RIGHTS TO EXISTING TECHNOLOGY.
3.1 DELIVERY OF EXISTING VOICE FILES. Not later than May 31, l996,
Amerigon will provide ANSLC with a copy of all then currently existing voice
files for Amerigon's VANS Navigation Software embodying the recorded speech
of Lunel. Such voice files will be provided to ANSLC in both compressed and
uncompressed formats, in SIX SYM CIX CMP format. Amerigon will also deliver
to ANSLC with such voice files such technical information as is reasonably
required to inform ANSLC how to access and utilize such voice files. IN THE
EVENT AMERIGON MAKES SUCH A DELIVERY OF VOICE FILES PRIOR TO THE EFFECTIVE
DATE, AND NO AGREEMENT IS REACHED BETWEEN NAVTECH AND ANSLC SUCH THAT THE
EFFECTIVE DATE DOES NOT OCCUR, ANSLC SHALL HAVE NO RIGHTS TO DISTRIBUTE,
SELL, LICENSE, MARKET OR COMMERCIALLY EXPLOIT THE VOICE FILES DELIVERED TO
ANSLC PURSUANT TO THIS SECTION.
3.2 DELIVERY OF SALES FULFILLMENT/ACTIVATION TECHNOLOGY. Upon
execution of this Agreement, ANSLC will provide Amerigon with a copy of those
items identified in Schedule 3.2. ANSLC will also deliver to Amerigon such
other technical information and materials as are reasonably required to
inform Amerigon how to utilize the Sales Fulfillment/Activation Technology.
3.3 COVENANTS NOT TO ▇▇▇.
3.3.1 BY AMERIGON. Except as otherwise provided in Section 18,
the Amerigon Releasing Parties hereby covenant not to bring any claim for
relief, whether by litigation or otherwise, based on allegations (whether
true or not) that any information, technology, knowledge, know-how or
products known to or in the possession of the ANSLC Parties at May 10, 1996
or any of the materials delivered by Amerigon to ANSLC pursuant to Section
3.1, include or incorporate in any way, or are in any way based on or derived
from, proprietary information or intellectual property (including copyrights,
trade secrets or otherwise) created, developed, authored or owned (legally,
equitably or beneficially) by or on behalf of any of the Amerigon Releasing
Parties. This covenant by the Amerigon Releasing Parties shall extend to any
other party (whether an ANSLC Affiliate, ANSLC Sublicensee, customer or
otherwise) only to the extent that such entity's information, technology,
know-how or products are derived from any information, technology, knowledge,
know-how or products of any of
12
the ANSLC Released Parties which were known to or in the possession of the ANSLC
Released Parties at May 10, 1996.
3.3.2 BY ANSLC. Except as otherwise provided in Section 18, the
ANSLC Releasing Parties hereby covenant not to bring any claim for relief,
whether by litigation or otherwise, based on allegations (whether true or
not) that any information, technology, knowledge, know-how or products known
to or in the possession of Amerigon at May 10, 1996 or any of the materials
delivered by ANSLC to Amerigon pursuant to Section 3.2 include or incorporate
in any way, or are in any way based on or derived from proprietary
information or intellectual property (including copyrights, trade secrets or
otherwise) that was created, developed, authored or owned (legally, equitably
or beneficially) by or on behalf of any of the ANSLC Releasing Parties.
This covenant by the ANSLC Releasing Parties shall extend to any other party
(whether an Amerigon Affiliate, Amerigon Sublicensee, customer or otherwise)
only to the extent that such entity's information, technology, know-how or
products are derived from any information, technology, knowledge, know-how or
products of any of the Amerigon Released Parties which were known to or in
the possession of any of the Amerigon Released Parties May 10, 1996.
3.4 LIMITATION ON ANSLC'S RIGHTS TO GEN 4. Notwithstanding the
provisions of Section 3.3, each of the ANSLC Parties agrees that it and the
ANSLC Affiliates and ANSLC Sublicensees will not design, manufacture or sell
or authorize or assist in the design, manufacture or sale of any VANS
Hardware utilizing a system architecture meeting the definition of Gen 4
Hardware hereunder. Nothing contained herein shall be deemed to limit the
ANSLC Parties' or their Affiliates' or Sublicensees' respective rights to
design, manufacture or sell, or authorize the design, manufacture or sale of
VANS Hardware that utilizes a single chip that combines the functions of the
Digital Signal Processor and the Central Processing Unit.
3.5 LIMITATIONS ON AMERIGON'S RIGHTS. Notwithstanding the
provisions of Section 3.3, Amerigon agrees that, for a period of twenty-four
(24) months following May 10, 1996, Amerigon, the Amerigon Affiliates and the
Amerigon Sublicensees will not sell commercially any VANS Hardware
incorporating a Texas Instruments TMS320C32 DSP chip (or backward compatible
direct successors thereto or a second-source chips generally recognized in
the industry as clones of such chips or clones of backward compatible
successors thereto).
3.6 OWNERSHIP OF PROPRIETARY RIGHTS IN EXISTING TECHNOLOGY.
3.6.1 GENERAL. Since the Option and License Agreement was
executed, various technology relating to VANS Products has been created by
ANSI or ANSI Affiliates and/or
13
Amerigon or Amerigon Affiliates, including, without limitation, corrections
and enhancements to maps, improvements and enhancements to VANS Navigation
Software, improvements and enhancements to speech software, and new software
(including software tools) that did not exist when the Option and License
Agreement was executed.
3.6.2 ANSI OWNERSHIP. The ANSLC Parties and Amerigon agree
that, as between the ANSLC Parties and Amerigon, ANSLC will own all
copyrights, patents, trade secrets and other proprietary rights in any
technology, inventions and works of authorship created, invented, discovered
or made by any of the ANSLC Parties at any time prior to the date of this
Agreement that relate to any VANS Products, subject to Amerigon's rights set
forth in Section 3.3 and Section 6. Without limiting the foregoing, the
parties agree that all inventions described in Schedule 1.7 and all patent
rights therein are owned by ANSLC, subject to Amerigon's rights set forth in
Section 3.3 and Section 6.
3.6.3 AMERIGON OWNERSHIP. The ANSLC Parties and Amerigon agree
that, as between the ANSLC Parties and Amerigon, on the other hand, Amerigon
will own all copyrights, patents, trade secrets and other proprietary rights
in any technology, inventions and works of authorship created, invented,
discovered or made by Amerigon or any Amerigon Affiliate at any time prior to
the date of this Agreement that relate to any VANS Products, subject to
ANSLC's rights set forth in Section 3.3 and Section 7.
3.6.4 JOINT OWNERSHIP. The ANSLC Parties and Amerigon agree
that, as between the ANSLC Parties and Amerigon, ANSLC and Amerigon will
jointly own in equal undivided shares all copyrights, patents, trade secrets
and other proprietary rights in any technology, inventions and works of
authorship created, invented, discovered or made by or through joint
collaborative efforts of the ANSLC Parties or any Affiliate of any of the
ANSLC Parties, on the one hand, and Amerigon and/or any Amerigon Affiliate,
on the other hand, at any time prior to the date of this Agreement where both
Amerigon or any of its Affiliates and the ANSLC Parties or any of their
respective Affiliates contributed substantial and significant legally
protectible elements. Notwithstanding such joint ownership, neither party
shall have any obligation, express or implied, to deliver to the other any
materials relating to or embodying any such jointly owned technology,
inventions or works of authorship, except to the extent of any obligations
expressly set forth in this Agreement.
3.7 OWNERSHIP OF TRADEMARKS. The ANSLC Parties and Amerigon agree
that, as between the ANSLC Parties and Amerigon:
3.7.1 IVS TRADEMARK. Amerigon shall retain exclusive
trademark rights to the ▇▇▇▇ "IVS," and ANSI agrees not to use or authorize
the use of "IVS" or any ▇▇▇▇ confusingly similar to IVS.
14
3.7.2 VANS TRADEMARK. ANSLC shall retain exclusive trademark
rights to the marks "VANS," "AudioNav," "Audio Navigation Systems" and "vehicle
audio navigation system," to the extent such marks are legally protectible.
The ANSLC Parties agrees that licensees and distributors of Amerigon that have
already commenced to use the "VANS" ▇▇▇▇ or similar marks shall have the right
to continue to use such ▇▇▇▇, including without limitation that Eclipse
shall have the right to continue to use the marks "VAANS" and "voice activated
audio navigation system." Nothing contained in this Agreement shall be deemed
to constitute an admission or acknowledgement by the ANSLC Parties or Amerigon
as to the scope of protection for the terms "VANS" or "vehicle audio navigation
system."
3.8 NO WARRANTIES RE TECHNOLOGY. AMERIGON MAKES NO REPRESENTATION
OR WARRANTY OF ANY KIND TO ANY OF THE ANSLC PARTIES, AND THE ANSLC PARTIES MAKE
NO REPRESENTATION OR WARRANTY OF ANY KIND TO AMERIGON, WHETHER EXPRESS, IMPLIED
(EITHER IN FACT OR BY OPERATION OF LAW) OR STATUTORY WITH RESPECT TO THE VANS
PRODUCTS OR ANY TECHNOLOGY, INVENTIONS AND WORKS OF AUTHORSHIP OR ANY
PROPRIETARY RIGHTS CREATED, INVENTED, DISCOVERED OR MADE IN WHOLE OR IN PART BY
SUCH PARTY OR LICENSED TO THE OTHER PARTY PURSUANT TO THIS AGREEMENT. THE ANSLC
PARTIES AND AMERIGON EACH EXPRESSLY DISCLAIMS TO THE OTHER ALL WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND ALL IMPLIED
WARRANTIES AGAINST INFRINGEMENT. NEITHER THE ANSLC PARTIES, ON THE ONE HAND,
OR AMERIGON, ON THE OTHER HAND, WARRANTS OR REPRESENTS TO THE OTHER THAT ANY OF
THE TECHNOLOGY, INVENTIONS OR WORKS OF AUTHORSHIP CREATED OR INVENTED BY SUCH
PARTY OR LICENSED TO THE OTHER PARTY PURSUANT TO THIS AGREEMENT ARE ERROR-FREE
OR THAT OPERATION, USE OR IMPLEMENTATION THEREOF WILL BE UNINTERRUPTED.
4. INDEMNIFICATIONS
4.1 THIRD PARTY CLAIMS AGAINST THE ANSLC PARTIES. Except for
claims for which ANSLC has an indemnification obligation pursuant to this
Section 4, Amerigon agrees to indemnify and hold the ANSLC Parties and their
respective Indemnified Parties harmless from and against any claims, actions,
damages, liabilities, costs and expenses, including reasonable attorney's fees,
arising out of any claim brought by any Amerigon customer or licensee or other
third party arising out of Amerigon's operation of its business from and after
the Effective Date, including any claims arising out of the sale, licensing,
distribution, marketing or exploitation of VANS Products or Licensed Patents by
Amerigon, its Affiliates and Sublicensees, except to the extent such claims
arise out of (a) acts or deeds of any of the ANSLC Parties after the Effective
Date or (b) the sale, licensing, distribution, marketing or exploitation of VANS
Products or Licensed Patents by ANSLC, its Affiliates or Sublicensees.
15
4.2 THIRD PARTY CLAIMS AGAINST AMERIGON. Except for claims for
which Amerigon has an indemnification obligation pursuant to this Section
4, ANSLC agrees to indemnify and hold the Amerigon and its Indemnified Parties
harmless from and against any claims, actions, damages, liabilities, costs
and expenses, including reasonable attorney's fees, arising out of any claim
brought by any ANLSC customer or licensee or other third party arising out of
the operation by any of the ANSLC Parties of their respective businesses from
and after the Effective Date, including any claims arising out of the
sale, licensing, distribution, marketing or exploitation of VANS Products or
Licensed Patents by ANSLC, its Affiliates and Sublicensees, except to the extent
such claims arise out of (a) acts or deeds of Amerigon after the
Effective Date or (b) the sale, licensing, distribution, marketing or
exploitation of VANS Products or Licensed Patents by Amerigon, its Affiliates or
Sublicensees.
4.3 LIMITATIONS. The indemnification obligations set forth in this
Section 4 shall not apply with respect to claims asserted by third parties
unless the party claiming indemnification notifies the other of any such claims
promptly after the notifying party receives notice of such claims from the third
party and gives the other full opportunity to control the response thereto and
the defense thereof, including, without limitation, any agreement relating
to the settlement thereof. An indemnitor may settle any Action on terms and
conditions of such party's selection, provided they are not in conflict with the
terms of this Agreement and the indemnitor pays all settlement amounts. The
Indemnified Parties may participate in any Action at their expense, subject to
the additional rights described below. If an indemnitor fails to promptly
investigate, defend or settle, then the Indemnified Parties will,
following notification to the indemnitor, have the right from that time on to
have sole control of the defense of such Action and all negotiations for its
settlement or compromise, and in such event, the indemnitor will pay, as they
become due, all costs, expenses, and reasonable attorneys' fees incurred by the
Indemnified Parties in undertaking such actions and any judgments or decrees
which may be rendered against or any settlements or compromises that may be
entered into by the Indemnified Parties relating to a claim indemnified against
hereunder.
5. CREATION OF ADDITIONAL VOICE FILES.
5.1 ENGAGING LUNEL. ANSLC and Amerigon shall each have the right to
make arrangements for Lunel to produce additional voice files for use by the
respective parties. The parties shall consult with one another regarding the
scheduling of Lunel's time and shall coordinate their engagement of Lunel so
that both parties have reasonable access to and ability to utilize Lunel's
services for such purposes. Both parties will cooperate in good faith in
scheduling the use of Lunel's services so that neither party
16
monopolizes Lunel's time for an extended period or precludes the other from
having a reasonable ability to utilize Lunel's services.
5.2 COSTS OF PRODUCING VOICE FILES. In the event that ANSLC and
Amerigon each desire to have Lunel create an identical voice file, Amerigon and
ANSLC shall each bear one half of the commercially reasonable costs of producing
such voice file. In the event ANSLC or Amerigon engages Lunel to produce a
voice file which is not identical to a voice file sought by the other party, the
party engaging Lunel shall bear the full costs of creating such voice file. In
the event ANSLC engages Lunel to produce a voice file which is not identical to
a voice file sought by Amerigon, Amerigon agrees that during a period of one (1)
year from the Effective Date, it will use reasonable efforts to cooperate in
good faith to permit Lunel to use Amerigon's in-house studio to record such
voice files, provided that such studio time is scheduled on dates and times
reasonably convenient to Amerigon and that Amerigon has the personnel and
resources available to provide necessary technical support and supervision.
Amerigon shall charge ANSLC for use of such studio and related resources at
commercially reasonable rates. Amerigon shall have no obligation to permit any
personnel other than Lunel to have access to Amerigon's premises in
connection with such recording activities. In the event of any disputes between
Amerigon and ANSLC with respect to such recording activities or the technical
quality of such recordings, ANSLC's sole and exclusive remedy shall be to
arrange at ANSLC's expense to record such voice files at a studio other than the
one on Amerigon's premises. Amerigon will, upon ANSLC's request, provide ANSLC
with reasonable technical specifications (such as volume levels and descriptions
of equipment used in Amerigon's studio) to assist ANSLC in attempting to
replicate at another studio the sound quality of Lunel recordings made at
Amerigon's studio.
5.3 ROYALTIES. ANSLC and Amerigon shall each be responsible
for any royalties or per copy fees payable with respect to copies of voice files
made by it or under its authority.
5.4 OWNERSHIP AND LICENSING OF VOICE FILES. As between ANSLC and
Amerigon, ANSLC shall own all proprietary rights in any voice files which it
pays or has paid Lunel to create, Amerigon shall own all proprietary rights in
any voice files which it pays or has paid Lunel to create, and proprietary
rights in any voice files for which the costs are borne one-half by Amerigon and
one-half by ANSLC shall be jointly owned in equal undivided shares by Amerigon
and ANSLC, with each party having full non-exclusive rights to exercise all
rights of ownership with respect to such jointly owned voice files, provided
that notwithstanding such joint ownership, neither party shall have any
obligation to account to or pay the other party for the use of such jointly
owned voice files. For purposes of this Section, proprietary rights in voice
files shall include copyrights, rights of publicity and any other rights.
Nothing in this Section is intended to limit the rights
17
of either party pursuant to Section 3.3 with respect to voice files currently in
the possession of ANSLC or Amerigon or delivered pursuant to Section 3.1.
6. PATENT LICENSE FROM ANSLC TO AMERIGON.
6.1 GENERAL. ANSLC grants to Amerigon a worldwide nonexclusive
license under the ANSLC Licensed Patents as follows:
6.1.1 to make and have made VANS Products and to practice and
have practiced any method or process involved in the manufacture or use thereof;
6.1.2 to make, have made and use Manufacturing Apparatus and to
practice and have practiced any method or process involved in the manufacture or
use thereof;
6.1.3 to use, lease, sell and otherwise transfer VANS Products.
6.2 PASSCODE ACTIVATION PATENT. ANSLC grants to Amerigon a
worldwide nonexclusive license under the Passcode Activation Patent to
practice and have practiced any method or process in connection with the making,
use, lease, sale, transfer or other distribution or exploitation of VANS
Products.
6.3 EXTENSION OF LICENSE TO AFFILIATES AND SUBLICENSEES. The
licenses granted to Amerigon pursuant to this Section 6 includes the
right of Amerigon to sublicense Amerigon Sublicensees (which may include without
limitation Amerigon Affiliates). To the extent an Amerigon Sublicensee desires
to further sublicense any such rights, any such further sublicense agreement
must be entered into between Amerigon and the sublicensee, and not between an
Amerigon Sublicensee and the sublicensee. By way of example only, if Amerigon
sublicenses certain rights to an Amerigon Sublicensee, and such Amerigon
Sublicensee wishes to further sublicense certain rights such as manufacturing
rights, the sublicense of rights to the manufacturing sublicensee must be
entered into directly between Amerigon and such manufacturing sublicensee, and
not between the Amerigon Sublicensee and the manufacturing sublicensee.
Such manufacturing sublicensee would thereby become an Amerigon
Sublicensee. Each such Amerigon Sublicensee shall be bound by the terms and
conditions of Sections 6.3, 8, 13.6, 24.1, 24.2 and 24.4 of this Agreement as if
it were named herein in the place of Amerigon.
7. PATENT LICENSE FROM AMERIGON TO ANSLC.
7.1 GENERAL. Amerigon grants to ANSLC a worldwide nonexclusive
license under the Amerigon Licensed Patents as follows:
18
7.1.1 to make and have made VANS Products and to practice and
have practiced any method or process involved in the manufacture or use thereof;
7.1.2 to make, have made and use Manufacturing Apparatus and to
practice and have practiced any method or process involved in the manufacture or
use thereof;
7.1.3 to use, lease, sell and otherwise transfer VANS Products.
7.2 EXTENSION OF LICENSE TO AFFILIATES AND SUBLICENSEES. The licenses
granted to ANSLC pursuant to this Section 7 includes the right of ANSLC to
sublicense ANSLC Sublicensees (which may include without limitation Amerigon
Affiliates). To the extent an ANSLC Sublicensee desires to further sublicense
any such rights, any such further sublicense agreement must be entered into
between ANSLC and the sublicensee, and not between an ANSLC Sublicensee and the
sublicensee. Each such ANSLC Sublicensee shall be bound by the terms and
conditions of Sections 7.2, 8, 13.6, 24.1, 24.2 and 24.4 of this Agreement as if
it were named herein in the place of ANSLC.
8. PATENT NOTICES. Amerigon agrees to ▇▇▇▇ and to require Amerigon
Sublicensees to ▇▇▇▇ all VANS Products covered by the claim of an Issued ANSLC
Licensed Patent, and ANSLC agrees to ▇▇▇▇ and require ANSLC Sublicensees to ▇▇▇▇
all VANS Products covered by the claim of an Issued Amerigon Licensed Patent,
with the words "U.S. Patent No." and the numbers of the applicable Issued
Licensed Patents.
9. DISCLOSURE OF PATENTS. Each party shall disclose to the other within
thirty (30) days following Issuance any Licensed Patents hereunder Issued to
such party.
10. EXPENSES OF PATENT PROSECUTION. Except as otherwise provided in
this Section, each party shall bear its own expenses with respect to the
prosecution of any applications for patents owned by such party pursuant to
Section 3.6. To the extent that either party believes that an invention has
been made jointly by one or more employees or persons engaged by Amerigon, on
the one hand, and one or more employees or persons engaged by any of the ANSI
Parties, on the other hand, ANSLC and Amerigon shall, at the request of either
party, negotiate in good faith in an effort to agree upon whether such invention
was made jointly and whether any patent application should be made jointly, it
being the parties intention to avoid any error in identifying the inventor(s) of
a patent that could bar issuance of or jeopardize the validity of the patent.
If the parties agree that a patent application is to be made jointly, the
parties shall negotiate in good faith with respect to appropriate sharing
of the expenses of prosecuting such patent application and with respect to
management and control of the prosecution of such patent application.
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11. PATENT LITIGATION AND APPORTIONMENT OF RECOVERY.
11.1 EACH PARTY RESPONSIBLE FOR PROTECTION OF ITS PATENTS.
Amerigon shall be solely responsible for taking, at its expense, all actions,
legal or otherwise, which it deems reasonably necessary or desirable with
respect to infringements by third parties of the Amerigon Licensed Patents, and
ANSLC shall be solely responsible for taking, at its expense, all actions,
legal or otherwise, which it deems reasonably necessary or desirable with
respect to infringements by third parties of the ANSLC Licensed Patents.
Amerigon shall control the type and conduct of all such infringement actions
relating solely to Amerigon Licensed Patents (including without limitation sole
control over the settlement thereof) and ANSLC shall control the type and
conduct of all such infringement actions with respect to ANSLC Licensed
Patents (including without limitation sole control over the settlement thereof).
Amerigon and ANSLC each agrees to provide reasonable cooperation to the other in
connection with any such action and to keep the other informed of the progress
of any such action.
11.2 RIGHT TO SHARE LITIGATION EXPENSES AND APPORTIONMENT OF
RECOVERIES. Without limiting Amerigon's and ANSLC's respective rights to
control actions which either of them initiate to enforce their respective
Licensed Patents, as set forth in Section 11.1, in the event Amerigon undertakes
legal action with respect to alleged infringement by any third party of any of
the Amerigon Licensed Patents, or in the event ANSLC undertakes legal action
with respect to alleged infringement by any third party of any of the ANSLC
Licensed Patents, the party undertaking such action shall inform the other
party in writing of the action, including a description of the claims
asserted, the basis for the assertion of such claims, an estimate of the legal
fees and other expenses anticipated to be incurred in connection with such
action, and such other information reasonably requested by the other party. The
other party shall have the right, within sixty (60) days following receipt of
such information, to elect to bear up to fifty percent (50%) of the legal fees
and other expenses incurred in such action. In the event of such an election,
the party undertaking the action shall continue to have sole control over the
conduct of the action (including without limitation sole control over the
settlement thereof), shall ▇▇▇▇ the other party on a monthly basis for its share
of fees and expenses incurred in the preceding month, and shall keep the other
party reasonably apprised of all developments in the proceedings. Any recoveries
and/or settlement fees received from suits or settlements for alleged or actual
infringement in which fees and expenses are shared as set forth in this Section
shall, after payment of all fees and expenses, be divided between ANSLC and
Amerigon in the same proportion as the proportional sharing of fees and
expenses. By way of example only, if ANSLC undertakes legal action with respect
to alleged infringement by a third party of an ANSLC Licensed Patent, and
Amerigon elects to bear thirty percent (30%) of the legal fees and other
expenses
20
incurred in connection with such action, Amerigon would be entitled to receive
thirty percent (30%) of any recovery and/or settlement fees received.
12. ROYALTIES.
12.1 ROYALTIES PAYABLE BY ANSLC.
12.1.1 HARDWARE. With respect to VANS Hardware, ANSLC shall pay
to Amerigon the following amounts:
12.1.1.l Two Percent (2%) of the ANSLC Selling
Price with respect to all VANS Hardware.
12.1.1.2 To the extent that ANSLC or an ANSLC Affiliate
is entitled to receive royalties or other amounts calculated on the basis of the
ANSLC Selling Price (or a comparable royalty base), and the amount of such
royalties or other amounts exceeds Two Percent (2%) of the ANSLC Selling Price
for the VANS Hardware, all such royalties or other amounts in excess of Two
Percent (2%) of the ANSLC Selling Price shall be deemed to constitute
ANSLC Other Consideration. By way of example only, in the event ANSLC is
entitled to receive from an unrelated third party royalties equal to three
percent (3%) of the ANSLC Selling Price of VANS Hardware, ANSLC will pay to
Amerigon an amount equal to two percent (2%) of the ANSLC Selling Price with
respect to such VANS Hardware, and the remaining one percent (1%) of the ANSLC
Selling Price shall be deemed to constitute ANSLC Other Consideration, a
percentage of which shall be payable to Amerigon as set forth in Section 12.1.2.
12.1.2 SOFTWARE AND ANSLC OTHER CONSIDERATION. With respect to
VANS Software and ANSLC Other Consideration, ANSLC shall pay to Amerigon the
following amounts:
12.1.2.1 Fifteen Percent (15%) of the ANSLC Selling Price
with respect to all VANS Software and Fifteen Percent of all ANSLC Other
Consideration, provided that such amount shall be increased from Fifteen Percent
(15%) to Twenty Percent (20%) until such point ("Specified Recoupment") as the
sum of (a) the aggregate additional amounts paid by ANSLC pursuant to this
Section 12.1.2.1 as a result of such Five Percent (5%) increase plus (b) the
aggregate reduction in amounts paid by Amerigon to ANSLC pursuant to
Section 12.2.2.1 as a result of the Five Percent (5%) reduction described in
Section 12.2.2.1 equals Five Million Dollars ($5,000,000).
12.1.2.2 Thereafter, Ten Percent (10%) of the ANSLC
Selling Price with respect to all VANS Software and Ten Percent (10%) of all
ANSLC Other Consideration until such point as the aggregate amounts paid to
Amerigon pursuant to this Section
21
12.1.2.2 following Specified Recoupment equals Five Million Dollars
($5,000,000).
12.1.2.3 Thereafter, Seven and One Half Percent (7.5%)
of the ANSLC Selling Price with respect to all VANS Software and Seven and One
Half Percent (7.5%) of all ANSLC Other Consideration until such point as the
aggregate amounts paid to Amerigon pursuant to Sections 12.1.2.2 and this
Section 12.1.2.3 following Specified Recoupment equals Ten Million Dollars
($10,000,000).
12.1.2.4 Thereafter, Five Percent (5%) of the ANSLC
Selling Price with respect to all VANS Software and Five Percent (5%) of all
ANSLC Other Consideration.
12.1.2.5 To the extent that ANSLC or an ANSLC Affiliate
is entitled to receive royalties or other amounts calculated on the basis of
the ANSLC Selling Price with respect to VANS Software (or a comparable
royalty base), and the amount of such royalties or other amounts exceeds the
applicable percentage of the ANSLC Selling Price for such VANS Software which
is payable to Amerigon pursuant to this Section 12.1.2, all such royalties or
other amounts in excess of the percentage of the ANSLC Selling Price payable
to Amerigon shall be deemed to constitute ANSLC Other Consideration. By way
of example only, in the event ANSLC is entitled to receive from an unrelated
third party (i) royalties equal to twenty-five percent (25%) of the ANSLC
Selling Price of VANS Software; (ii) consulting fees; (iii) support fees;
(iv) a one-time payment; and (v) an equity investment in which the
licensee acquires an equity interest in ANSLC, Other Consideration would
include the consulting fees, the support fees, the one-time payment and that
portion of the equity investment which exceeds the fair market value of the
equity interest acquired, plus any portion of the royalty based on the
Selling Price of the VANS Software in excess of the royalty based on the
Selling Price of the VANS Software payable to Amerigon pursuant to
Section 12.1.2.1, 12.1.2.2, 12.1.2.3 or 12.1.2.4.
12.2 ROYALTIES PAYABLE BY AMERIGON.
12.2.1 HARDWARE. With respect to VANS Hardware, Amerigon
shall pay to ANSLC the following amounts:
12.2.1.1 Two Percent (2%) of the Amerigon Selling Price
with respect to all VANS Hardware.
12.2.1.2 To the extent that Amerigon or an Amerigon
Affiliate is entitled to receive royalties or other amounts calculated on
the basis of the Amerigon Selling Price (or a comparable royalty base), and the
amount of such royalties or other amounts exceeds Two Percent (2%) of the
Amerigon Selling Price for the VANS Hardware, all such royalties or other
amounts
22
in excess of Two Percent (2%) of the Amerigon Selling Price shall be deemed to
constitute Amerigon Other Consideration. By way of example only, in the event
Amerigon is entitled to receive from an unrelated third party royalties equal to
three percent (3%) of the Amerigon Selling Price of VANS Hardware, Amerigon will
pay to ANSLC an amount equal to two percent (2%) of the Amerigon Selling Price
with respect to such VANS Hardware, and the remaining one percent (1%) of the
Amerigon Selling Price shall be deemed to constitute Amerigon Other
Consideration, a percentage of which shall be payable to ANSLC as set forth
in Section 12.2.2.
12.2.2 SOFTWARE AND AMERIGON OTHER CONSIDERATION. With
respect to VANS Software and Amerigon Other Consideration, Amerigon shall pay
to ANSLC the following amounts:
12.2.2.1 Fifteen Percent (15%) of the Amerigon Selling
Price with respect to all VANS Software and Fifteen Percent (15%) of all
Amerigon Other Consideration, provided that such amount shall be reduced from
Fifteen Percent (10%) to Ten Percent (10%) until Specified Recoupment.
12.2.2.2 Thereafter, Ten Percent (10%) of the Amerigon
Selling Price with respect to all VANS Software and Ten Percent (10%) of all
Amerigon Other Consideration until such point as the aggregate amounts paid to
Amerigon pursuant to this Section 12.2.2.2 following Specified Recoupment equals
Five Million Dollars ($5,000,000).
12.2.2.3 Thereafter, Seven and One Half Percent (7.5%)
of the Amerigon Selling Price with respect to all VANS Software and Seven and
One Half Percent (7.5%) of all Amerigon Other Consideration until such point as
the aggregate amounts paid to Amerigon pursuant to Section 12.2.2.2 and this
Section 12.2.2.3 following Specified Recoupment equals Ten Million Dollars
($10,000,000).
12.2.2.4 Thereafter, Five Percent (5%) of the Amerigon
Selling Price with respect to all VANS Software and Five Percent (5%) of all
Amerigon Other Consideration.
12.2.2.5 To the extent that Amerigon or an Amerigon
Affiliate is entitled to receive royalties or other amounts calculated on the
basis of the Amerigon Selling Price with respect to VANS Software (or a
comparable royalty base), and the amount of such royalties or other amounts
exceeds the applicable percentage of the Amerigon Selling Price for such VANS
Software which is payable to ANSLC pursuant to this Section 12.2.2, all such
royalties or other amounts in excess of the percentage of the Amerigon Selling
Price payable to Amerigon shall be deemed to constitute Amerigon Other
Consideration.
23
12.3 EXPIRATION OF PAYMENT OBLIGATIONS. Except as otherwise
provided in Section 24.5 hereof, ANSLC's and Amerigon's payment obligations
pursuant to Sections 12.1 and 12.2 shall apply to sales, leases, licenses,
marketing and other exploitation of VANS Products and Licensed Patents during a
period commencing on the date of this Agreement and terminating ten (10) years
following the date of this Agreement and no amounts shall be payable pursuant to
Sections 12.1 or 12.2 with respect to sales, leases, licenses, marketing and
other exploitation of VANS Products or Licensed Patents after such ten (10) year
period. Royalties which have accrued hereunder during such ten (10) year
period shall remain payable in accordance with the terms of this Agreement
following expiration of such ten (10) year period.
12.4 RESPONSIBILITY FOR AFFILIATES AND SUBLICENSEES.
12.4.1 ANSLC RESPONSIBILITY FOR ANSLC AFFILIATES AND
SUBLICENSEES. ANSLC acknowledges and agrees that it is responsible and
liable hereunder for payment of amounts payable to Amerigon based on the Selling
Price at which a VANS Product is sold, licensed or otherwise made available or
exploited by ANSLC, an ANSLC Affiliate or an ANSLC Sublicensee to a third party
other than ANSLC, an ANSLC Affiliate, an ANSLC Sublicensee or an
Affiliate of an ANSLC Sublicensee, or based on ANSLC Other
Consideration received by ANSLC or an ANSLC Affiliate, irrespective of whether
ANSLC collects any monies from its Affiliates or Sublicensees with
respect to such sale, license or other transaction, and irrespective of
whether such VANS Product uses or incorporates any proprietary rights licensed
to ANSLC by Amerigon pursuant to this Agreement.
12.4.2 AMERIGON RESPONSIBILITY FOR AMERIGON AFFILIATES AND
SUBLICENSEES. Amerigon acknowledges and agrees that it is responsible and liable
hereunder for payment of amounts payable to ANSLC based on the Selling Price at
which a VANS Product is sold, licensed or otherwise made available or exploited
by Amerigon, an Amerigon Affiliate or an Amerigon Sublicensee to a third party
other than Amerigon, an Amerigon Affiliate, an Amerigon Sublicensee or an
Affiliate of an Amerigon Sublicensee, or based on Amerigon Other Consideration
received by Amerigon or an Amerigon Affiliate, irrespective of whether Amerigon
collects any monies from its Affiliates or Sublicensees with respect to such
sale, license or other transaction, and irrespective of whether such VANS
Product uses or incorporates any proprietary rights licensed to Amerigon by
ANSLC hereunder.
13. ACCRUALS, RECORDS AND REPORTS.
13.1 ACCRUAL OF ROYALTIES. Royalties payable to ANSLC based on the
Amerigon Selling Price shall accrue when VANS Products with respect to which
royalty payments are required by this Agreement are first sold, leased,
licensed or otherwise made
24
available or exploited by Amerigon, an Amerigon Affiliate or an Amerigon
Sublicensee to an Unrelated Third Party. Royalties payable to Amerigon based
on the ANSLC Selling Price shall accrue when VANS Products with respect to
which royalty payments are required by this Agreement are first sold, leased,
licensed or otherwise made available or exploited by ANSLC, an ANSLC
Affiliate or an ANSLC Sublicensee to an Unrelated Third Party. In the event
a VANS Product is made available to an Unrelated Third Party on a true
consignment basis, royalties shall accrue on the earlier of (a) receipt of
payment for such VANS Product or (b) sixty (60) days following delivery of
such VANS Product, unless such VANS Product is returned by the consignee
prior to the expiration of such sixty (60) day period. Royalties payable to
ANSLC based on Amerigon Other Consideration shall accrue when such Amerigon
Other Consideration is received by Amerigon or an Amerigon Affiliate.
Royalties payable to Amerigon based on ANSLC Other Consideration shall accrue
when such ANSLC Other Consideration is received by ANSLC or an ANSLC
Affiliate.
13.2 STATEMENTS. Quarterly accounting periods shall end on the last
day of each March, June, September and December during the term of this
Agreement. Within thirty (30) days after the end of each such period each
party to this Agreement shall furnish to the other a written report
containing the information specified in Section 13.5 and shall pay to the
other party all unpaid royalties accrued hereunder to the end of each such
period.
13.3 LATE CHARGES. Payment shall be deemed made when received. Late
charges at the rate of one percent (1) per month or the maximum rate
permitted by applicable law, whichever is lower, shall accrue on any due and
payable amounts that are not paid when due hereunder, including any accrued
but unpaid late charges. Accrual of such late charges shall be without
limitation of any other rights or remedies.
13.4 FORM OF PAYMENTS. All royalties and other payments due
hereunder shall be paid in United States dollars. All royalties for an
accounting period computed in other currencies shall be converted into United
States dollars at the exchange rate for bank transfers from such currency to
United States dollars as quoted by the head office of Citibank N.A., New
York, at the close of banking on the last day of such accounting period (or
the first business day thereafter if such last day shall be a non-business
day).
13.5 CERTIFICATION. Quarterly reports shall be certified by an
officer of the party submitting such report or his designee and shall contain
the following information:
13.5.1 Identification, description and quantity of each VANS
Product upon which royalties have accrued pursuant to Section 13.1;
25
13.5.2 Identification of the entity that sold, leased,
licensed, made available or otherwise exploited each VANS Product upon which
royalties have accrued pursuant to Section 13.1 and identification and basis
for calculation of such entity's Selling Price for such VANS Product,
including without limitation an itemization of all deductions from the gross
invoiced billing price pursuant to Section 1.32 ;
13.5.3 Identification of all Other Consideration upon which
royalties have accrued pursuant to Section 13.1;
13.5.4 Such other information as is reasonably required in order
to understand the calculation of amounts payable pursuant to such quarterly
report;
13.5.5 Identification of Sublicensees to which such party or any
of its Affiliates or Sublicensees has, since the previous quarterly report,
granted any rights to make, or have made VANS Products or to practice or have
practiced any method or process involved in the manufacture or use thereof;
or to make, have made or use Manufacturing Apparatus or practice or have
practiced any method or process involved in the manufacture or use thereof;
or to use, lease, sell or otherwise transfer VANS Products;
13.5.6 In the event no royalties are due, the quarterly report
shall so state.
13.6 RECORDS. Amerigon and ANSLC shall each keep and require its
respective Affiliates and Sublicensees to keep records in sufficient detail
to permit the determination of royalties payable hereunder. Amerigon and
ANSLC shall, at request of the other, permit an independent auditor selected
by the other, or any other person acceptable to both ANSLC and Amerigon, to
examine such records and other materials of Amerigon or ANSLC as may be
required by the auditor to verify or determine royalties paid or payable
under this Agreement. In the event ANSLC or Amerigon requests that the other
conduct an examination of one or more of such other party's Affiliates or
Sublicensees, such other party will engage an independent auditor acceptable
to both ANSLC and Amerigon, to examine such Affiliate's or Sublicensee's
records and shall share the results of such examination with the party
requesting such examination. Any audit of Amerigon or ANSLC or an Affiliate
or Sublicensee shall be conducted during ordinary business hours and only
once in each calendar year. Any auditor or other person shall be instructed
to report to the party requesting such audit only the amount of royalties
determined to be due and payable. The party requesting an audit shall bear
the expense of any such audit unless such audit reveals a shortfall of Fifty
Thousand Dollars ($50,000) or more in the amounts paid to such party, in
which event the costs of such audit shall (in addition to, and without
limitation of, any
26
other rights or remedies the requesting party may have hereunder or at law or
in equity) be borne by the other party hereto. In the event of any
discrepancy arising out of such audit which indicates that the other is owed
amounts hereunder, ANSLC or Amerigon shall, within thirty (30) days following
delivery to it of written confirmation establishing such discrepancy,
reimburse the other for the amount of any such discrepancy arising out of
such audit as well as the costs of the audit, if applicable, as provided
above. If no request for examination of such records and materials for a
particular quarterly accounting period has been made by ANSLC or Amerigon, as
applicable, within six (6) years after the end of said period, the right to
examine such records and materials for said period and the obligation to keep
such records and materials for said period shall terminate.
13.7 TAXES. Amerigon and ANSLC shall bear and pay all taxes
(including, without limitation, sales and value added taxes but excluding
income tax as specified below) imposed by any governmental authority of any
country in which such party conducts business as the result of the existence
of this Agreement or the exercise of rights hereunder, provided that each
party shall not bear and pay any income tax withholding imposed by any
national government upon the payments made to the other party pursuant to
Section 12 to the extent that such income tax is to be credited to taxes
payable by such other party to the United States government. Each party may
deduct any such withholding taxes from amounts otherwise payable to the other
party hereunder and furnish the other party with a tax certificate for such
withheld income tax.
14. SECURITY INTERESTS. ANSLC and Amerigon will endeavor in good faith to
negotiate and enter into Security Agreements within thirty (30) days
following the Effective Date, which Security Agreements shall thereupon be
attached to this Agreement as Schedule 14-A and 14-B. ANSLC and Amerigon
acknowledge and agree that they have not conducted due diligence with respect
to security interests that may previously have been granted by either ANSLC
or Amerigon, and that ANSLC's or Amerigon's ability to grant a security
interest consistent with this Section may be limited by previously granted
security interests. ANSLC and Amerigon further acknowledge and agree that
their respective obligations to endeavor in good faith to negotiate and enter
into Security Agreements will be subject to the parties' respective good
faith determinations that entering into such Security Agreements will not
unduly interfere with the parties' ability to secure financing or investments
or conduct business. Subject to the foregoing, ANSLC and Amerigon
acknowledge that it is their current intention that the Security Agreements
to be negotiated will likely provide key terms comparable to the following,
but such terms may be subject to change as the parties consider and negotiate
the implications of the Security Agreements:
27
(a) ANSLC would grant to Amerigon, and Amerigon would grant to
ANSLC, respectively, a security interest in the collateral (the
"Collateral") consisting of the proceeds of exploitation of the rights
granted to or acknowledged to belong to each of them under Sections 3,
6 and 7 hereof (the "Settlement Rights"), including but not limited to
licenses or sublicenses to others and consideration payable
thereunder; provided that the Collateral would not include the
Settlement Rights in and of themselves; and further provided that such
security interest would be subordinate to any consensual security
interest except to the extent of that portion of any specific proceeds
which is equal to the amount payable to the secured party pursuant
hereto on account of such proceeds.
(b) The Security Agreements would provide that such subordination
would be automatic and self-enforcing; for the inclusion of the
subordination statement in all financing statements, mortgages or
similar documents designed to perfect such security interest;
and for the obligation of ANSLC and Amerigon to execute
subordination agreements consistent with such subordination, both as
to priority and remedies, if requested to do so in connection with the
grant of any consensual security interests.
(c) The Security Agreements would provide that the Collateral
will secure obligations arising under this Settlement and License
Agreement and expenses of enforcement, including but not limited to
reasonable attorneys' fees; for the execution of additional documents
reasonably necessary to perfect the security interests granted; and
would contain other appropriate provisions, identical to both ANSLC
and Amerigon, as are consistent with the foregoing.
15. LIMITATIONS ON PUBLIC STATEMENTS.
15.1 GENERAL. Amerigon, on the one hand, and the ANSLC Parties,
on the other hand, each agrees to refrain from and agrees to direct its
employees to refrain from, making public statements maligning or impugning
the reputation or integrity of the other. Recognizing that it is difficult
for either party fully to police compliance with this Section, the parties
agree that a party shall not be deemed to be in default of this Section as a
result of statements made by one of its employees without knowledge or
support from such party's upper management, provided such party takes
reasonable corrective action after being notified of any such statements.
The parties further agree that statements to customers or prospective
customers comparing the performance of the parties' respective products shall
not be deemed to violate the terms of this Section 15.1, provided that each
party reserves its legal and/or equitable rights with respect to untruthful
or misleading
28
statements comparing the performance of the parties' respective products.
15.2 EXCEPTIONS AND EXCLUSIONS. Nothing contained herein shall be
deemed to limit the rights of either party to disclose information or make
statements:
15.2.1 to the extent ordered to do so by a court of competent
jurisdiction or regulatory agency or body or to the extent required in order
to make an appropriate response to a legitimate subpoena or legitimate
discovery request;
15.2.2 to the extent required by applicable law (including any
regulations or orders promulgated thereunder);
15.2.3 to the extent required in order to report income to
appropriate taxing authorities and/or to contest the imposition of any tax by
appropriate taxing authorities;
15.2.4 to such party's officers, directors, employees,
accountants and attorneys;
15.2.5 to the extent such disclosure is reasonably required
for a valid business purpose, including without limitation, to prospective
investors or prospective customers or to parties seeking to acquire all or
any portion of such party's stock or assets;
15.2.6 in connection with any legal proceedings between the
parties hereto relating to this Agreement.
15.3 PRESS RELEASE. Amerigon and ANSLC shall jointly issue a
press release on or shortly after the Effective Date in a form mutually
approved by ANSLC and Amerigon, such approval not to be unreasonably withheld
by either ANSLC or Amerigon.
16. RELEASES; DISMISSAL OF LEGAL PROCEEDING.
16.1 RELEASE BY AMERIGON. Except for the obligations, covenants,
representations and warranties provided for in this Agreement, Amerigon, for
and on behalf of itself and its predecessors, successors, assigns, heirs,
affiliates, employees, agents, legal representatives and partners
(individually and collectively referred to herein as the "Amerigon Releasing
Parties"), do hereby fully, finally and forever release and discharge the
ANSLC Parties, and their respective predecessors, successors, assigns, heirs,
affiliates, shareholders, officers, directors, employees, agents, legal
representatives, and parent, subsidiary or other related companies
(individually and collectively referred to herein as the "ANSLC Released
Parties") of and from any and all claims, rights, debts, liabilities,
demands, obligations, promises, damages, causes of action and
29
claims for relief of whatever kind or nature, known or unknown, which any of
the Amerigon Releasing Parties may have had or asserted, may now have or
assert or may hereafter have or assert against the ANSLC Released Parties, or
any of them, in whatever capacity any of the ANSLC Released Parties may have
been acting, for or by reason of any occurrence, matter or thing which has
occurred on or before the Effective Date, including without in any way limiting
the generality of the foregoing, any and all claims which were or could have
been asserted in connection with, or arising from or out of any of the
facts, transactions or occurrences alleged in or in connection with any of the
Disputed Matters.
It is expressly understood by Amerigon, on behalf of itself and the
Amerigon Releasing Parties, that Section 1542 of the California Civil Code
provides as follows:
"Section 1542. General Releases -- Claims Extinguished. A
general release does not extend to claims which the creditor does not know
or suspect to exist in his favor at the time of executing the release,
which if known by him must have materially affected his settlement with the
debtor."
To the extent the provisions of Section 1542 of the California Civil
Code as well as the provisions of any and all comparable or similar statutes
or principles of the law of California or any other state or federal
jurisdiction might otherwise be deemed applicable, they are hereby expressly
and with the advice of counsel waived by Amerigon, on behalf of itself and
the Amerigon Releasing Parties, and each of them, and Amerigon admits to full
knowledge and understanding of the consequences and effects of this waiver.
16.2 RELEASE BY ANSLC PARTIES. Except for the obligations,
covenants, representations and warranties provided for in this Agreement,
each of the ANSLC Parties, for and on behalf of itself and its respective
predecessors, successors, assigns, heirs, affiliates, shareholders, officers,
directors, employees, agents, legal representatives, and parent, subsidiary
or other related companies (individually and collectively referred to herein
as the "ANSLC Releasing Parties"), does hereby fully, finally and forever
release and discharge Amerigon and its predecessors, successors, assigns,
licensees, customers, heirs, affiliates, employees, agents, legal
representatives, partners, shareholders, officers, directors, employees,
agents, legal representatives, and parent, subsidiary or other related
companies (individually and collectively referred to herein as the "Amerigon
Released Parties") of and from any and all claims, rights, debts,
liabilities, demands, obligations, promises, damages, causes of action and
claims for relief of whatever kind or nature, known or unknown, which any of
the ANSLC Releasing Parties may have had or asserted,
30
may now have or assert or may hereafter have or assert against the Amerigon
Released Parties, or any of them, in whatever capacity any of the Amerigon
Released Parties may have been acting, for or by reason of any occurrence,
matter or thing which has occurred on or before the Effective Date, including
without in any way limiting the generality of the foregoing, any and all claims
which were or could have been asserted in connection with, or arising from or
out of any of the facts, transactions or occurrences alleged in or in connection
with any of the Disputed Matters.
It is expressly understood by ANSLC, on behalf of itself and the ANSLC
Releasing Parties, that Section 1542 of the California Civil Code provides as
follows:
"Section 1542. General Releases -- Claims Extinguished. A
general release does not extend to claims which the creditor does not
know or suspect to exist in his favor at the time of executing the
release, which if known by him must have materially affected his
settlement with the debtor."
To the extent the provisions of Section 1542 of the California Civil
Code as well as the provisions of any and all comparable or similar statutes
or principles of the law of California or any other state or federal
jurisdiction might otherwise be deemed applicable, they are hereby expressly
and with the advice of counsel waived by ANSLC, on behalf of itself and the
ANSLC Releasing Parties, and each of them, and ANSLC admits to full knowledge
and understanding of the consequences and effects of this waiver.
16.3 STIPULATION FOR DISMISSAL OF LITIGATION. ANSI and Amerigon
agree to enter into, and shall direct their counsel to execute concurrently
with the execution of this Agreement, a stipulation dismissing with prejudice
the Legal Proceeding in its entirety, including all claims and counterclaims
therein, in the form attached hereto as Exhibit A. Amerigon shall file the
stipulation with the Court within ten (10) days after the date of this
Agreement and shall thereafter provide counsel for ANSI with a conformed copy
of the stipulation.
16.4 COMPROMISE ONLY. The releases set forth in this Section 16 are
made for purposes of settlement and compromise only. Neither this Agreement
nor anything contained herein, nor any act or thing done in connection
herewith, is intended to be or shall be construed or deemed to be an
admission of any party of liability, fault or wrongdoing, or an admission of
any party of any fact, allegation or claim whatsoever, including any fact,
allegation or claim alleged by any party in or in connection with the
Disputed Matters.
31
17. REPRESENTATIONS.
17.1 MUTUAL REPRESENTATIONS. Each party to this Agreement hereby
represents, warrants and agrees as follows:
17.1.1 Such party has received competent and independent
legal advice from its counsel regarding the meaning and legal effect of this
Agreement, and regarding the advisability of making the agreements provided for
herein, and fully understands the same;
17.1.2 Each person executing this Agreement on behalf of a
party hereto has the full right and authority to enter into this Agreement on
behalf of such party and the full right and authority to execute all instruments
provided for in this Agreement and to fully bind said party to the terms and
obligations of this Agreement;
17.1.3 Such party is the sole and lawful owner of all right,
title and interest in and to every claim or other matter which such party
purports to release herein, and that such party has full power to enter into
this Agreement and has not heretofore assigned, transferred or encumbered, or
purported to assign, transfer or encumber, voluntarily or involuntarily, to
any person or entity which is not a party to this Agreement, all or any
portion of the claims, obligations or rights covered by this Agreement.
17.2 REPRESENTATIONS BY ANSLC PARTIES. The ANSLC Parties warrant,
represent and agree that the ANLSC Parties have not heretofore derived any
revenues from the sale, licensing, distribution, or other exploitation of
VANS Software, including prototypes or pre-release versions thereof.
17.3 LIMITATIONS AND EXCLUSIONS. Except as expressly set forth in
this Agreement, neither party makes any representations or warranties,
express or implied to the other party to this Agreement, nor does either
party assume any liability in respect of any infringement of third party
patents or other rights of third parties due to the other party's operation
under the licenses and immunities from suit herein granted.
18. CONFIDENTIALITY OBLIGATIONS. Amerigon agrees to take reasonable steps
to hold in confidence and not reveal, report, publish, disclose or transfer
any information contained in pending ANSLC patent applications previously
disclosed to Amerigon, and Amerigon represents to ANSLC that it has not
disclosed to any third party on or prior to the Effective Date any such
confidential information. The ANSLC Parties agree to take reasonable steps
to hold in confidence and not reveal, report, publish, disclose or transfer
any of the following information previously disclosed to any of the ANSLC
Parties: information contained in Amerigon
32
business plans, information contained in pending Amerigon patent
applications, Amerigon interface specifications, Amerigon driver designs, and
Amerigon electronics designs. The ANSLC Parties represent that the ANSLC
Parties have not disclosed to any third party on or prior to the Effective
Date any such confidential information. Notwithstanding the foregoing, this
Section 18 is not intended to limit the rights of the parties to use or
incorporate information in connection with their own respective products and
business operations. Accordingly, to the extent information that is subject
to this Section 18 is utilized or incorporated by Amerigon or ANSLC in its
respective own products or business operations, Amerigon and ANSLC shall each
be free to disclose such information as it deems appropriate in the conduct
of its respective business (and a previous disclosure of such information as
incorporated in such products or business operations shall not be deemed a
breach of the representations made pursuant to this Section). By way of
example only, ANSLC would be free to utilize information contained in an
Amerigon business plan in the operation of its own business and to disclose
to third parties such information as it relates to the operation of ANSLC's
business, but ANSLC would be obligated to hold in confidence the fact that
such information was part of Amerigon's business plans. Also by way of
example only, ANSLC would be free to utilize information contained in
Amerigon electronics designs in the design of ANSLC's own products and to
disclose to third parties the electronics designs of ANSLC's own products,
but ANSLC would not be permitted to disclose to third parties the specifics
of the electronics designs of Amerigon's products. Also by way of example
only, a prior disclosure by ANSLC to third parties of the design of ANSLC's
own products would not be deemed a breach of ANSLC's representation pursuant
to this Section regarding no disclosure of confidential information prior to
the Effective Date. Notwithstanding anything to the contrary contained in
this Agreement, the disclosee's obligations under this Section 18 shall not
extend to information (a) publicly known or which becomes publicly known
other than as a result of the fault or negligence of the disclosee or the
disclosee's failing to perform any of its obligations hereunder; (b) already
known by the disclosee without an obligation of confidentiality at the time
of first disclosure by the disclosing party; (c) rightfully received by the
disclosee from a third party that has the right to provide such information
to the disclosee without obligations of confidentiality; or (d) rightfully
and independently developed or ascertained by the disclosee.
19. DISPUTE RESOLUTION.
19.1 GENERAL. Any disagreement, dispute, controversy or claim
arising out of or relating to this Agreement, or the obligations of the
parties hereunder (a "Dispute"), regardless of the magnitude thereof or the
amount in controversy or whether such Dispute would otherwise be considered
justiciable or ripe for resolution by a court or arbitral tribunal, shall be
resolved and
33
determined only in accordance with the following provisions of this Section 19.
19.2 DISPUTE ESCALATION. Neither party shall commence any
arbitration proceeding relating to any Dispute until the procedures set forth
in this Section 19.2 have been followed. Upon the written request of either
party each of the parties will appoint a designated representative whose task
it will be to attempt to resolve such dispute or to negotiate for an
adjustment to such provision of this Agreement. Such representatives will
discuss the problem and/or negotiate in good faith in an effort to resolve
the dispute or renegotiate the applicable section or provision without the
necessity of any formal proceedings. During the course of such negotiation,
all reasonable requests made by one party to the other for information,
including requests for copies of relevant documents, will be honored. The
specific format for such discussions will be left to the discretion of the
designated representatives but may include the preparation of agreed upon
statements of fact or written statements of position furnished to the other
party. If the designated representatives are unable to agree within thirty
(30) days of their first meeting, each party shall, upon request by either
party, appoint a designated officer to meet to attempt to resolve the
matter. No arbitration proceedings or litigation for the resolution of such
dispute may be commenced until such a meeting between officers has occurred
and either party has concluded in good faith that amicable resolution through
continued negotiation of the matter does not appear likely (unless either
party fails or refuses to schedule such a meeting of officers within a
reasonable time after a request by the other party).
19.3 RESOLUTION OF DISPUTES RE SELLING PRICE ALLOCATION ISSUES. In
the event of a dispute between ANSLC and Amerigon with respect to appropriate
calculation and allocation of portions of the Selling Price pursuant to
Section 1.32, ANSLC and Amerigon shall first follow the procedures set forth
in Section 19.2 in an effort to resolve such dispute. In connection with
such negotiations, ANSLC and Amerigon shall each present to the other written
data to support their respective contentions regarding appropriate allocation
of the Selling Price, which may include INTER ALIA written data relating to
the prices at which ANSLC, Amerigon and/or their respective Affiliates and
Sublicensees have sold or licensed various products, and written data
regarding pricing and valuation of third party software, hardware and
consumer electronics products, as appropriate. In connection with such
negotiations, each party shall make at least one proposal, in writing, for
appropriate allocation of the Selling Price.
19.3.1 SELECTION OF ARBITRATOR. If ANSLC and Amerigon are
unable to resolve such dispute over allocation of the Selling Price within
such thirty (30) day period, ANSLC and Amerigon shall agree on a single
arbitrator within
34
fifteen (15) days following the end of such thirty (30) day period who
shall be an individual knowledgeable about marketing, distribution and
pricing of computer hardware, software and consumer electronics products. If
ANSLC and Amerigon are unable to agree on a single arbitrator within such
fifteen (15) day period, the single arbitrator shall, at the written request
of either party, be appointed by the American Arbitration Association.
19.3.2 HEARING AND RESOLUTION. The single arbitrator selected shall
be directed to schedule a one day hearing within twenty (20) days after his
or her selection. At the hearing, ANSLC and Amerigon shall present the
arbitrator with the data previously exchanged between ANSLC and Amerigon
pursuant to Section 19.3 regarding appropriate allocation of the Selling
Price, and ANSLC and Amerigon shall each present the arbitrator with the most
recent proposed Selling Price allocation presented by ANSLC or Amerigon,
respectively, to the other party during negotiations pursuant to Section
19.3. Any data or information regarding pricing of third party hardware,
software or consumer electronics products and any documents which either
party intends to introduce at such hearing shall be provided to the other
party at least ten (10) days prior to the hearing, and neither ANSLC nor
Amerigon shall be permitted to introduce at the hearing any pricing data or
documents not so provided to the other party in advance of the hearing. At
the conclusion of the one day hearing, ANSLC and Amerigon shall each be
permitted to submit to the arbitrator a final proposed Selling Price
allocation (the "Final Proposed Allocations"). The arbitrator shall select
one of the two Final Proposed Allocations in its totality. The arbitrator
must select one of the two Final Proposed Allocations AS-IS, and shall not
be permitted to modify such allocation or to compromise between the two Final
Proposed Allocations. The Final Proposed Allocation so selected by the
arbitrator shall thereupon be deemed binding upon the parties with respect to
such disputed matter, retroactive to the commencement of any sales, licenses
or other transactions relating to the product in question.
19.3.3 EXPENSES. The arbitrator shall require, as part of the final
decision, that the party against whom the arbitrator renders a decision
reimburse any or all of the expenses and costs (including without limitation
attorneys' fees) incurred by the other party in connection with the
arbitration pursuant to this Section 19.3, and pay all costs and expenses of
the arbitration itself, such as compensation to the arbitrator and reporter
and the expense of hearing room facilities.
35
19.4 ARBITRATION. If any Dispute, other than a dispute with respect
to appropriate calculation and allocation of portions of the Selling Price
pursuant to Section 1.32 or a dispute over what portion of consideration paid
for a stock or equity interest exceeds the fair market value of such interest
pursuant to Section 1.27, is not resolved as a result of the procedures set
forth in Section 19.2, such Dispute shall be submitted to, and finally
determined by, arbitration in accordance with this Section 19.4.
19.4.1 Except as provided below or in Section 19.3, if any
dispute occurs between the parties arising out of or related to this
Agreement or its negotiation, execution or performance, whether such dispute
is in contract, tort or otherwise, and including disputes as to whether a
dispute is subject to arbitration, it will be submitted to binding
arbitration at the request of either party if the parties are unable to
resolve such dispute pursuant to Section 19.2. The arbitration will be
conducted by one arbitrator under the commercial arbitration rules of the
American Arbitration Association then in effect. The arbitrator will be
chosen from a panel of persons with a knowledge of industry practices in the
computer and consumer electronics industries and admitted to practice law in
at least one state.
19.4.2 In connection with any arbitration hearings, the
parties shall be entitled to submit written legal briefs for consideration by
the arbitrator in accordance with a schedule to be negotiated by the parties
or to be established by the arbitrator if the parties are unable to agree.
Except as provided in this Section 19.4 or Section 21.2, the arbitrator may
award any remedy consistent with the commercial arbitration rules. The
arbitrator will have the authority in the arbitrator's discretion to award
costs and attorneys' fees to the prevailing party. The arbitrator will not
have the power or authority to award any punitive, exemplary or other
non-compensatory damages, any penalties. The parties will be entitled to
discovery to the same extent provided for civil actions in the Central
District of the State of California. The parties agree to endeavor in good
faith to select an arbitrator within thirty (30) days after either party
provides written notice to the other of its election to arbitrate and to
endeavor in good faith to complete the arbitration within one hundred eighty
(180) days following such notice.
19.5 GENERAL PROVISIONS RE ARBITRATION. Any arbitration will be held
and the award deemed made in Los Angeles County, California. The parties
agree to be bound by the decision of the arbitrator and judgment upon the
award rendered thereby may be entered in any court having jurisdiction within
the State of
36
California. The parties hereby submit to the in personam jurisdiction of the
federal and state courts located in the State of California for all purposes
of this Section and any disputes arising under this Agreement.
20. APPRAISAL OF FAIR MARKET VALUE. In the event of a dispute between
ANSLC and Amerigon regarding what portion of consideration paid for a stock
or equity interest exceeds the fair market value of such interest pursuant to
Section 1.27, ANSLC and Amerigon shall attempt pursuant to Section 19.2 to
agree on the fair market value of such stock or equity interest or to agree
on a single appraiser mutually acceptable to both parties to make a binding
determination of such fair market value. If the parties are unable to agree
on the fair market value or on a single appraiser pursuant to the procedures
set forth in Section 19.2, then within five (5) days after written notice
from one party to the other, ANSLC and Amerigon shall each appoint one person
to render an appraisal of the fair market value of such stock or equity
interest, which appraisals shall be rendered by written decision within
thirty (30) days of the appointment of the second of the two appraisers. If
the higher of the resulting two appraisals is not more than fifteen percent
(15%) higher than the lower of the two appraisals, the average (I.E., the
mean) of the two appraisals will be final and conclusive upon both parties.
If the higher of the resulting two appraisals is more than fifteen (15%)
higher than the lower of the two appraisals, the two persons so chosen shall,
within five (5) days of the rendering of written appraisals by both
appraisers, appoint a third impartial appraiser, who shall render by written
decision an appraisal within thirty (30) days thereafter. In the event of
such an appointment of a third appraiser, the average (I.E., the mean) of the
appraised value rendered by such third appraiser and the closest to such
third appraiser's appraised value of the other two appraised values will be
final and conclusive upon both parties. All appraisers shall be reasonably
qualified and knowledgeable regarding the appraisal of businesses and stocks
such as those of ANSLC. If either party fails to designate its appraiser as
provided above, the appraiser designated by the other party will act as the
sole appraiser and will be deemed to be the single, mutually approved
appraiser to determine the fair market value of the stock or equity interest.
In such event, the sole appraiser shall render his or her written decision
within thirty (30) days of the expiration of said initial five (5) day
period. ANSLC shall provide the appraisers with such financial and other
information as the appraisers may reasonably request.
21. TERM OF LICENSE RIGHTS; LIMITATION OF REMEDIES.
21.1 TERM OF LICENSE RIGHTS. The license rights granted by ANSLC
to Amerigon and by Amerigon to ANSLC hereunder with respect to any patents
shall continue for the duration of the applicable patent, and the license
rights granted with respect to any other proprietary rights shall continue
for the duration of
37
such proprietary rights. Notwithstanding the foregoing sentence, the payment
of royalties as provided in Sections 12 and 13 hereof being an essential and
material element of this Agreement, the parties agree that: (a) the failure
to pay in full all royalties determined to be due pursuant to Section 19
hereof, or, if Section 19 shall be determined not to be controlling of the
issue, by a court of competent jurisdiction, within ten (10) days of the
final determination of the arbitrators, or, if applicable, entry of a final
judgment or order of such court; or (b) rejection of this Agreement under 11
U.S.C. Section 365, shall constitute a material breach of this Agreement and
shall terminate all rights of the breaching party to further use, sale and/or
sublicensing of the rights granted under Section 6 or 7 hereof, respectively,
but shall effect no such termination of the rights of the nonbreaching party,
subject to the provisions of 11 U.S.C. Section 365(n), to the extent
applicable.
21.2 NO INJUNCTIVE RELIEF. Except as provided in Section 21.1
hereof or in the Security Agreements to be entered into pursuant to Section
14 hereof, and notwithstanding anything to the contrary set forth elsewhere
herein, in no event shall ANSLC or Amerigon be entitled to terminate any of
the license rights granted pursuant to Sections 3, 6 or 7 hereof or to enjoin
or seek to enjoin the other party's exercise of any of the license rights
granted pursuant to Sections 3, 6 or 7 hereof, and each party hereby
expressly waives any right to injunctive or other equitable relief to
terminate or enjoin the exercise of any such rights, whether based on
statute, common law, or otherwise, arising out of any alleged default by the
other party or any of its Affiliates or Sublicensees. Nothing contained
herein shall be deemed to limit or restrict ANSLC's or Amerigon's rights or
remedies with respect to matters outside the scope of this Agreement, such as
patents which are not ANSLC Licensed Patents or Amerigon Licensed Patents
hereunder.
22. PAYMENTS TO NAVTECH AND LERNOUT & HAUSPIE AND OTHER THIRD PARTIES.
Amerigon and ANSLC shall each bear its own respective costs of any license
fees payable to third parties in connection with their respective
exploitation of VANS Products, including without limitation costs of license
fees payable to NavTech and Lernout & Hauspie.
23. NOTICES. Except for the patent notices referred to in Section 8,
neither party shall have any obligation to provide notices or credit of any
kind to the other party in connection with the exploitation of VANS Products.
ANSI expressly agrees that Amerigon shall be entitled to sell off its
existing inventory of VANS Products containing notices or credits in ANSI's
name.
38
24. COMPATIBILITY / INTEROPERABILITY.
24.1 VANS NON-NAVIGATION SOFTWARE. ANSLC and Amerigon each intends
that the other party to this Agreement not be prevented from creating VANS
Non-Navigation Software that operates on the VANS Hardware of the other party
and its Affiliates and Sublicensees ("Interoperable Software"). Accordingly,
each party agrees to provide and require each of its Affiliate and
Sublicensee to provide the other party to this Agreement with technical
information reasonably necessary to permit the other party to make
Interoperable VANS Non-Navigation Software to run on such VANS Hardware and
each party hereby grants the other a nonexclusive, worldwide right to make,
have made, practice, have practiced, copy, distribute, transmit, create
derivative works based upon, use, lease, sell and otherwise transfer and
exercise all proprietary rights in and to such Interoperable VANS
Non-Navigation Software. Without limiting the foregoing, to the extent that
either party or any Affiliate or Sublicensee of such party employs a
"lock-out" or similar mechanism designed to prevent or hinder the use of
unauthorized Interoperable VANS Non-Navigation Software on its VANS Hardware,
such party will provide the other and require each of its Affiliates and
Sublicensees to provide the other with technical information reasonably
necessary to circumvent or bypass such "lock-out" or similar mechanism.
24.2 VANS NAVIGATION SOFTWARE. To the extent that either party or
any Affiliate or Sublicensee of such party employs a "lock-out" or similar
mechanism designed to prevent or hinder the use of unauthorized VANS
Navigation Software on its VANS Hardware, and such entity permits any third
party other than an Affiliate of such entity to create VANS Navigation
Software that can be used on such party's VANS Hardware, the other party to
this agreement will thereupon be deemed to have the nonexclusive right to
make, have made, practice, have practiced, copy, distribute, transmit, create
derivative works based upon, use, lease, sell and otherwise transfer and
exercise all proprietary rights in and to Interoperable VANS Navigation
Software, and such entity will provide such technical information reasonably
necessary to permit the other party to make such VANS Navigation Software,
subject to the same geographic limitations imposed on such third party. By
way of example only, if either party permits an unrelated third party to
create Interoperable VANS Navigation Software that can be used on such
party's VANS Hardware and to distribute such VANS Navigation Software in
Japan, such party will provide the other party with such technical
information reasonable necessary to permit the other party to make
Interoperable VANS Navigation Software, and the other party shall have the
right to create Interoperable VANS Navigation Software and distribute such
Interoperable VANS Navigation Software in Japan.
24.3 TRANSFERABILITY OF RIGHTS. Nothing in this Agreement shall
be deemed to authorize Amerigon or ANSLC to provide
39
to any third party any of the technical information provided to it pursuant
to this Section 24 or to transfer or sublicense to any third party any of the
rights granted to it pursuant to this Section 24, except that Amerigon or
ANSLC shall each have the right to provide to a single Affiliate or
Sublicensee the technical information provided to it pursuant to this Section
24 and to transfer and sublicense to such Affiliate or Sublicensee all of the
rights granted to it pursuant to this Section 24, provided in the event of
such a transfer and sublicense by Amerigon or ANSLC, as the case may be,
Amerigon or ANSLC, as the case may be, shall retain no rights pursuant to
this Section 24 and all such rights shall thereafter be vested solely in such
Affiliate or Sublicensee (with such Affiliate or Sublicensee also having
the right to transfer and sublicense such rights to one of its Affiliates or
Sublicensees, provided that it retains no rights following such transfer, it
being the intention of Amerigon and ANSLC that a succession of
transfers/sublicenses to Affiliates or Sublicensees shall be permitted so
long as only a single entity has rights under this Section 24 at any time).
By way of example only, Amerigon would have the right to transfer its rights
pursuant to this Section 24 to a joint venture that is an Affiliate of
Amerigon, in which event Amerigon would thereafter retain no rights pursuant
to this Section 24. Nothing contained herein shall be deemed or construed
to restrict either party from lawfully creating and exploiting Interoperable
VANS Non-Navigation Software or Interoperable VANS Navigation Software to the
extent such software can be lawfully created and exploited without any grant
of rights pursuant to this Section.
24.4 LIMITED TECHNICAL SUPPORT. The parties do not intend that
either party or any Affiliate or Sublicensee be required pursuant to Section
24.1 or 24.2 to provide the other party with extensive technical support or
assistance in creating such Interoperable VANS Navigation Software, but the
parties do intend to require that reasonably sufficient specifications be
provided to permit the creation of Interoperable VANS Navigation Software and
that limited telephonic technical assistance be provided in the event of
errors or lack of clarity in such specifications.
24.5 ROYALTY ADJUSTMENT. Royalties payable with respect to
Interoperable VANS Navigation Software shall be as set forth in Section 12,
subject to adjustment pursuant to the provisions of this Section. If
Amerigon or ANSLC enters into an agreement with a third party providing for
lower royalties with respect to such Interoperable VANS Navigation Software,
or for a shorter duration of royalty obligations with respect to such
Interoperable VANS Navigation Software, it shall provide the other party with
written notice of such lower rate and/or shorter duration and the material
terms of such contract, including information regarding product volumes or
present-value dollar amounts commitments, and shall promptly provide the
other party with such additional information
40
as the other party may reasonably request regarding the pricing and duration
of payment obligations under such contract and the commitments provided by
such third party in consideration for such pricing and payment obligations.
For thirty (30) days after the receipt of such notice and information, the
other party shall have the option to make to the party providing such notice
commitments substantially equal to those made by the third party in exchange
for the same pricing and duration of payment obligations provided to such
third party and subject to the same limitations applicable to such third
party. The objective of this Section is to provide the parties with the
opportunity to obtain the lowest price and shortest duration of royalties
offered by the other party with respect to Interoperable VANS Navigation
Software by substantially matching any greater commitments made by such a
third party which result in a lower price for such third party. Accordingly,
the parties agree to discuss in good faith any greater third party
commitments and potential means for the other party to make comparable
commitments, to qualify for such lower rate and/or shorter duration. If the
other party elects to make comparable commitments on a going forward basis,
adjustments to the royalty rate and/or duration shall also be made on a going
forward basis to reflect the most favored pricing provisions of this Section
24.5. Except as otherwise provided in this Section 24.5, the royalty
obligations of the parties with respect to Interoperable VANS Navigation
Software shall be perpetual.
25. OPERATION OF TOLL-FREE 800 NUMBER; OUTSOURCING AGREEMENT. Effective
May 31, 1996 or the end of the calendar month in which the Effective Date
occurs, whichever is later, Amerigon will assume responsibility for operating
the toll-free 800 support service for the Gen 4 Hardware and Gen 4 Software,
and ANSI will have no further obligations or responsibilities in connection
therewith other than to effectuate an orderly transition of such service to
Amerigon without disruption of service.
25.1 RIGHT START AGREEMENT. Effective May 31, 1996 or the end of the
calendar month in which the Effective Date occurs, whichever is later, ANSI
will assign to Amerigon, and Amerigon will assume ANSI's prospective
obligations with respect to, the Outsourcing Agreement, or substantially the
equivalent will be accomplished by Amerigon's entering into a superseding
agreement with The Right Start, Inc. on substantially the same terms.
25.2 CREDIT CARD PROCESSING AGREEMENT. Effective May 31, 1996 or the
end of the calendar month in which the Effective Date occurs, whichever is
later, ANSI will assign to Amerigon, and Amerigon will assume ANSI's
prospective obligations with respect to, the Credit Card Processing
Agreement, or substantially the equivalent will be accomplished by Amerigon's
entering into a superseding agreement with First U.S.A./DMGT on
substantially the same terms.
41
26. CUSTOMER LISTS. ANSLC and Amerigon shall each retain exclusive rights
to any customer lists or similar data compiled by such party in connection
with its sales and marketing activities with respect to VANS Products, and
neither party shall have any obligation to provide the other party with any
such lists or data, except that ANSLC shall provide Amerigon upon execution
hereof with a customer lists and any available data regarding customers who
have activated disks for the Gen 4 Hardware via the toll free 800 number
prior to the date of Amerigon's assumption of responsibility for operation of
the 800 number. Amerigon shall be free to use such customer list and data in
any manner Amerigon desires.
27. RELATIONSHIP OF PARTIES. Nothing in this Agreement shall be deemed to
create a joint venture, partnership or principal-agent relationship between
any of the ANSLC Parties, on the one hand, and Amerigon, on the other hand.
None of the ANSLC Parties is by virtue of this Agreement authorized as an
agent or legal representative of the Amerigon, and Amerigon is not by virtue
of this Agreement authorized as an agent or legal representative of any of
the ANSLC Parties . None of the ANSLC Parties is granted any right or
authority to assume or to create any obligation or responsibility, express or
implied, on behalf of or in the name of Amerigon or to bind Amerigon in any
manner, and Amerigon is not granted any right or authority to assume or to
create any obligation or responsibility, express or implied, on behalf of or
in the name of any of the ANSLC Parties or to bind any of the ANSLC Parties
in any manner.
28. MISCELLANEOUS.
28.1 NOTICES AND COMMUNICATIONS. Except as otherwise specifically
provided herein, any notice required or permitted to be sent by this
Agreement will be in writing and will be (a) delivered by hand, (b) sent by
fax (if the receiving machine confirms receipt through answerback and the
sending machine prints a paper copy of the answerback message), (c) mailed by
registered, certified mail or other pre-paid, receipted delivery service,
return receipt requested, to the address or fax number provided by this
Agreement, or (d) sent by a reputable next business day courier delivery
service such as Federal Express. Complying notices will be effective: (w)
when delivered by hand; (x) when sent by fax, (y) three (3) business days
after deposited in the mail in the manner required by subsection (c) above,
with proper postage prepaid, or (z) one (1) business day after deposit with
the delivery service. Notices will be addressed as follows or as from time to
time directed in writing by either party by notice given hereunder:
42
To Amerigon:
Amerigon, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: President
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
-WITH 1ST CLASS MAIL COPY TO-
Blanc ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Kronstadt
1900 Avenue of the Stars
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
To ANSI or ANSLC:
Audio Navigation Systems LLC
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
-WITH 1ST CLASS MAIL COPY TO-
▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
Loeb and Loeb
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
28.2 EXCUSED PERFORMANCE. Neither party will be liable for delays in
or failure of performance required under this Agreement when such delay or
failure is due to acts of God, acts of civil or military authority, fire,
flood, strikes, war, epidemics, shortage of power, or other cause beyond such
party's reasonable control and without its fault or negligence, provided such
party: (A) uses best efforts to promptly notify the other in advance of
conditions which may result in any such delay in or failure of performance;
(B) uses best efforts to avoid or remove such conditions; and (C) immediately
continues performance when such conditions are removed.
28.3 ASSIGNMENT. Except as provided in this Section 28.3, this
Agreement may not be assigned in whole or in part by ANSLC or Amerigon
without the other party's prior written consent, which shall not be
unreasonably withheld or delayed. By way of example only, legitimate, good
faith and reasonable concerns that there exists a material risk of a
prospective assignee's insolvency, where such risk is materially greater than
the risk of the assignor's insolvency, would be reasonable grounds for
withholding consent. Also by way of example only, mere concern that a
prospective assignee is a potentially formidable competitor
43
that could place the other party at a competitive disadvantage shall not be
deemed reasonable grounds for withholding consent. ANSLC and Amerigon shall
each have the right, without seeking or obtaining the other party's consent,
to assign or transfer this Agreement or any interest herein (including
without limitation rights and duties of performance) to any entity (i) which
owns more than fifty percent (50%) of such party's issued and outstanding
voting stock, (ii) in which such party owns more than fifty percent (50%) of
the issued and outstanding voting stock, (iii) which acquires all or
substantially all of such party's operating assets, or (iv) into which such
party is merged or reorganized pursuant to any plan of merger or
reorganization.
28.4 INTEGRATION. This Agreement and the Schedules attached
hereto constitute the entire agreement of the parties and supersede any other
agreement or understanding, written or oral, that may have been made or
entered into with regard to the subject matter hereof by any of the ANSLC
Parties, on the one hand, and Amerigon, on the other hand. The Schedules
attached hereto are a material part of this Agreement and are incorporated
herein by this reference as if fully written in this Agreement.
28.5 MODIFICATION. This Agreement may not be altered, amended or
modified, except by formal agreement in writing signed by duly authorized
representatives of both parties, except as expressly provided herein.
28.6 WAIVER OR DELAY. Any waiver or delay in the exercise by a
party of its right to terminate or enforce any provision of this Agreement
for any breach by the other party will not prejudice such party's right of
termination or enforcement for such breach or any further, continuing or
other breach by the other party.
28.7 SEVERABILITY. If any provision of this Agreement is, for any
reason, held unenforceable or invalid in any respect under the laws of any
jurisdiction where enforcement is sought, the invalidity or unenforceability
will not affect: (i) any other provision of this Agreement and this Agreement
will be construed as if such unenforceable or invalid provision were not
contained herein; and (ii) enforcement or validity of such provision in any
other jurisdiction.
28.8 SURVIVAL. The respective obligations of the ANSLC Parties and
Amerigon hereunder which by their nature would continue beyond termination or
expiration hereof, including but not limited to obligations of
confidentiality and the limitations of liability, will survive termination or
expiration of this Agreement.
28.9 GOVERNING LAW. This Agreement will be construed and enforced
in accordance with the laws of California as applied to
44
contracts entered into in and performed in California between California
residents.
28.10 HEADINGS. The Article and Section headings of this Agreement are
for convenience only and will neither be considered a part of, nor affect the
construction or interpretation of, any provision of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of May 10, 1996.
AMERIGON, INC. AUDIO NAVIGATION SYSTEMS, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------- ----------------------------
Title Vice President Title President
------------------------- -------------------------
Date 5/10/96 Date 5/10/96
-------------------------- --------------------------
ALCOM ENGINEERING CORPORATION AUDIO NAVIGATION SYSTEMS, LLC
By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ By /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------- ----------------------------
Title President Title President
------------------------- -------------------------
Date 5/10/96 Date 5/10/96
-------------------------- --------------------------
45
Schedule 1.29
Description or Identification of Passcode Activation
Patent Application
United States patent application "Method and System for Disseminating
Stored Programs and Data" currently enumerated as Loeb & Loeb patent file
PD-4611, and all foreign filings thereon.
1
Schedule 1.3
List of Amerigon Licensed Patents as of date of Agreement
NONE
1
Schedule 1.7
List of ANSLC Licensed Patents as of date of Agreement
1. United States patent #5,274,560, "Sensor free vehicle navigation system
utilizing a voice input/output interface for routing a drive from his
source point to his destination point" and all foreign filings thereon,
including without limitation the following filings: Brazil No. 9.107.099;
Canada No. 2,096,840; EPC No. ▇▇▇▇▇▇▇▇.7; Japan No. 3-517237; S. Korea No.
701633/93; PCT No PCT/US91/03696; Taiwan No. 80104229.
2. United States patent #5,454,062, "Method for recognizing spoken words", and
all foreign filings thereon.
3. United States patent application "Methods and apparatus for improving the
reliability or recognizing words in a large database when the words are
spelled or spoken", currently enumerated as Loeb & Loeb patent file PD-
2950, and all foreign filings thereon.
4. United States patent application "Vehicle navigation system providing
travel directions based on existing travel conditions", currently
enumerated as Loeb & Loeb patent file PD-2916, and all foreign filings
thereon.
5. United States patent application "Navigation system utilizing audio CD
player for data storage", currently enumerated as Loeb & Loeb patent file
PD-2844, and all foreign filings thereon.
6. United States patent application "Sensor free vehicle navigation system
utilizing a voice input/output interface for routing a driver from his
source point to his destination point", currently enumerated as Loeb & Loeb
patent file PD-3004, and all foreign filings thereon.
1
Schedule 2
Transition Date and Surviving Obligations of
Parties Under Prior Agreements and Agreements
To Be Assigned
1. ANSI and Amerigon will continue to fulfill their respective obligations
under the Agreement Re Gen 4 Navigation System dated July 24, 1995, as amended
by an Amendment dated as of August 14, ▇▇▇▇ (▇▇▇ "▇▇▇ 4 Agreement"), and the Gen
4 Agreement will remain in full force and effect in accordance with its terms,
through [May 31, 1996]. Thereafter, all obligations of Amerigon and ANSI as set
forth in the Gen 4 Agreement will terminate and be of no further force or
effect, except that the terms of such agreement (including payment and
accounting terms) shall continue to govern all sales and distribution occurring
pursuant to such agreement through [May 31, 1996]. Without limiting the
foregoing, ANSI shall remain obligated to account for and pay to Amerigon its
share of "Adjusted Gross Revenues" as set forth in Section 6.3 of the Gen 4
Agreement, and Amerigon shall be obligated to account for and pay to ANSI
royalties as set forth in Section 6.4 of the Gen 4 Agreement, for all sales and
services provided thereunder through [May 31, 1996].
2. Except to the extent any terms of the Option and License Agreement dated as
of July 13, 1992 are incorporated by reference as part of the Gen 4 Agreement
with respect to activities governed by the Gen 4 Agreement, the Option and
License Agreement shall terminate and be of no further force or effect as of the
Effective Date.
3. ANSLC shall remain obligated to pay one-half of legal fees and costs
incurred by Amerigon on or before the Effective Date with respect to ANSLC
Licensed Patents in accordance with the terms of the existing agreement between
ANSI and Amerigon governing the sharing of such legal fees and costs.
2
Schedule 3.2
Materials relating to Sales Fulfillment / Activation Technology
To Be Delivered by ANSLC to Amerigon
1. Source code, random number generator, random number seed, random number
tables used for encryption (generation of a pass code on a PC).
2. Source code, random number generator, random number seed, random number
tables used for decryption (enabling the use of metro areas within the
navigator).
3. Specifications for software or procedures used by Right Start to facilitate
the sale of metro area usage to end users.
4. All lists, data bases, compilations, summaries or statistics relating to
customers, customer attributes, metro areas enabled, and type of navigator
prepared by Right Start and/or ANSI prior to the transfer of the Right
Start operation to the control of Amerigon.
1
Schedule 14-A
Security Agreement #1
(Grant of Security Interest by Amerigon to ANSLC)
To Be Attached When Agreed To
2
Schedule 14-B
Security Agreement #2
(Grant of Security Interest by ANSLC to Amerigon)
To Be Attached When Agreed To
3
ADDENDUM
TO SETTLEMENT AND LICENSE AGREEMENT
BY, BETWEEN AND AMONG
AMERIGON, INC., AUDIO NAVIGATION SYSTEMS, LLC,
ALCOM ENGINEERING CORPORATION AND AUDIO NAVIGATION SYSTEMS, INC.
Amerigon, Inc., a California corporation ("Amerigon"); Audio Navigation
Systems, Inc., a California corporation ("ANSI"); Audio Navigation Systems, LLC,
a California limited liability corporation ("ANSLC"); and Alcom Engineering
Corporation, a California corporation ("Alcom") are parties to a Settlement
and License Agreement (the "Agreement") dated May 10, 1996.
This Addendum reflects the following additional understandings and
agreements of the parties to the Agreement as follows:
1. Unless otherwise specified herein, any capitalized terms used in this
Addendum have the same meanings as specified in the Agreement.
2. Pursuant to the Agreement, the parties agreed that although
the Agreement was being executed on May 10, 1996, the Agreement would not be
binding or effective unless and until ANSLC concludes an agreement with NavTech
reasonably acceptable to ANSLC granting ANSLC license rights in the NavTech
technology comparable to those held by Amerigon. ANSLC warrants and represents
that ANSLC and NavTech are entering into such an agreement concurrently with
the execution of this Addendum. Accordingly, the parties agree that the
Effective Date of the Agreement shall be June 12, 1996.
3. Pursuant to Section 15.3 of the Agreement, Amerigon and ANSLC are
jointly to issue a press release on or shortly after the Effective Date in a
form mutually approved by ANSLC and Amerigon, such approval not to be
unreasonably withheld by either ANSLC or
1
Amerigon. Attached hereto as Exhibit "A" is the form of joint press release
mutually approved by ANSLC and Amerigon.
IN WITNESS WHEREOF, the parties have executed this Addendum this 12th day of
June, 1996.
AMERIGON, INC. AUDIO NAVIGATION SYSTEMS, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------- ----------------------------
Title Vice President Title President
------------------------- -------------------------
Date 6/12/96 Date 6/12/96
-------------------------- --------------------------
ALCOM ENGINEERING CORPORATION AUDIO NAVIGATION SYSTEMS, LLC
By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ By /s/ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------- ----------------------------
Title President Title President & CEO
------------------------- -------------------------
Date 6/11/96 Date 6/12/96
-------------------------- --------------------------
2