EXHIBIT 10.19
CONFIDENTIAL
[CADENCE LOGO]
SOFTWARE OEM LICENSE AGREEMENT
BETWEEN
SIMPLEX SOLUTIONS, INC.
AND
CADENCE DESIGN SYSTEMS, INC.
EFFECTIVE DATE: January 11, 2002
AGREEMENT NO. OEM-02SIMP0111
CADENCE CONFIDENTIAL
SOFTWARE OEM LICENSE AGREEMENT
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INDEX
Section Description Page
------- ----------- ----
RECITAL ................................... 3
1.0 DEFINITIONS ............................... 3
2.0 APPOINTMENT ............................... 5
3.0 DELIVERY AND ACCEPTANCE ................... 6
4.0 LICENSE GRANT ............................. 6
5.0 MAINTENANCE, TRAINING AND ENHANCEMENTS .... 10
6.0 MARKETING AND PROMOTION ................... 11
7.0 FEES ...................................... 12
8.0 SOURCE CODE ESCROW ........................ 14
9.0 PROTECTION OF CONFIDENTIAL INFORMATION .... 16
10.0 WARRANTIES ................................ 17
11.0 INDEMNITY ................................. 18
12.0 LIMITATIONS OF LIABILITY .................. 19
13.0 TERM AND TERMINATION ...................... 20
14.0 CADENCE SOFTWARE .......................... 20
15.0 GENERAL ................................... 20
EXHIBITS:
Exhibit A - Products and Designated Equipment
Exhibit B - Maintenance and Support Services
Exhibit C - Fees and Payment
Exhibit D - Software Deposit Agreement
Exhibit E - Licenses for Use in Professional Services
Exhibit F - Trademark Specifications
Exhibit G - House Accounts for [*]
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SOFTWARE OEM LICENSE AGREEMENT
* Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
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[CADENCE LOGO]
SOFTWARE OEM LICENSE AGREEMENT
Effective Date: January 11, 2002
Agreement No: OEM-02SIMP0111
This
Software OEM License Agreement ("Agreement") is entered into effective as
of the date set forth above by and among, on the one hand, CADENCE DESIGN
SYSTEMS, INC., a Delaware corporation having a principal place of business at
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and CADENCE DESIGN SYSTEMS
(IRELAND) LIMITED, a corporation organized and existing under the laws of
Ireland having a place of business at ▇▇▇▇▇ ▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇
▇, ▇▇▇▇▇▇▇ (collectively, "Cadence" as defined below), and, on the other hand,
SIMPLEX SOLUTIONS, INC., a Delaware corporation, having a principal place of
business at ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ("VENDOR").
WHEREAS Cadence develops and markets software application programs used in the
electronic deign automation industry for the computer-aided engineering, design,
co-verification, simulation, and layout of advanced electronic circuits, printed
circuit boards and electronic Systems and subsystems; and
WHEREAS Vendor has developed certain computer programs and desires to grant
Cadence rights to market, distribute and grant end user sublicenses to such
programs on a world-wide basis, subject to the fees and other terms of this
Agreement; and
WHEREAS Cadence desires, subject to the terms of this Agreement, to market,
distribute and grant end user sublicenses to Vendor's programs as stand alone
products, or in combination or for use with complementary software and systems
which Cadence develops or distributes;
NOW THEREFORE in consideration of the mutual promises herein contained the
parties hereby agree as follows:
1.0 DEFINITIONS.
In addition to the terms defined elsewhere in this Agreement, the following
terms have the following meanings:
1.1 "Ancillary Work" means any software code written by or for Cadence
(and not by Vendor) for the purpose of tightly integrating the Licensed Work,
through its defined interfaces and without modification of the Licensed Work
itself, as an integral and functioning part of Cadence's product framework
environment and/or to meet unique requirements of an End User, or provide new or
improved features, functionality or enhancements, provided that any such code
which uses proprietary interfaces or is a derivative work of the Licensed Work
shall be used solely for integrating the Licensed Work with complementary
products in a design flow and shall not be used with products that are
substitute or competitive with the Licensed Work.
1.2 "Cadence" means Cadence Design Systems, Inc. and Cadence Design
Systems (Ireland) Limited and wholly owned world-wide Subsidiaries of Cadence
Design Systems, Inc. only so long as such entities remain wholly owned
Subsidiaries of Cadence Design Systems, Inc.
1.3 "Designated Equipment" means computer hardware listed on Exhibit A,
and also including the operating system environment with which Cadence's
products operate as listed on Exhibit A. At the request of either party from
time to time, the parties shall amend Exhibit A to reflect expansions and
extensions of the product families as may be approved by the Steering Committee
under Section 5.3.
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1.4 "Documentation" means the all following data sheets, user manuals
and/or education and training materials in human or machine readable form, and
all Maintenance Modification and Enhancements thereto, which are: (i) operating
instructions and user manuals for the Product(s) that are released by Vendor for
distribution to End Users ("End User Documentation"), (ii) marketing and sales
literature for the Products which Vendor releases for use by sales
representatives, distributors, and marketing personnel to market and promote the
Product(s) ("Marketing Documentation"), and (iii) technical documentation which
Vendor releases for integration and first line support of the Product(s) which
describes the external interfaces and features of the Product(s) ("Technical
Documentation"). Notwithstanding the foregoing, Documentation shall not include
source code, internal development specifications or other similar information
which is not generally made available by Vendor for the purposes described
above.
1.5 "End User" means an entity that acquires the Licensed Work for its
internal production use.
1.6 "Enhancement" means any modification(s), revision(s), upgrade(s) or
addition(s) to a Product, in object code form, made by or on behalf of Vendor
that is (i) released and made generally available by Vendor as part of a new
version of the Licensed Work during the term of this Agreement, or (ii) approved
by the Steering Committee and included in a new release of the Licensed Work
during the term of this Agreement that improves its function, adds new
function(s) or substantially enhances its performance, including, without
limitation, new versions of the Products. Enhancements shall include updates to
the Documentation. Notwithstanding the foregoing, Enhancements shall not include
any modification(s), revision(s), upgrade(s) or addition(s) which substantially
change the overall features or functions of the Product(s) without the prior
written consent of Vendor, it being expressly understood that Fire & Ice QX, [*]
are separate products and not Enhancements of one another.
1.7 "Error(s)" means any malfunction or defect in the Products and/or a
mistake in the Documentation for the unaltered, then-current or previous
sequential release that is reproducible by Vendor and that prevents the Product
from correctly operating in full conformance with its functional specifications,
including, without limitation, any material adverse deviation from commonly
accepted standards for normal and correct operation of computer programs, even
if not explicitly mentioned in the Documentation, e.g., any case where the
Product abnormally ceases function, produces incorrect or misleading information
or erroneously interprets information given to it, and similar deviations.
1.8 "Fees" means the fees that Cadence shall pay to Vendor for the
rights granted hereunder, as more specifically described in Section 7 below.
1.9 "Intellectual Property Rights" means semiconductor topography
rights, mask works rights, patents, copyrights, trademarks (including service
marks), trade secrets, and design rights, whether registered or unregistered,
and including any application for registration of any of the foregoing and all
rights or forms of protection of a similar nature of having equivalent or
similar effect to any of these, which may subsist anywhere in the world.
1.10 "Licensed Work(s)" means the Products and End User Documentation
collectively.
1.11 "Maintenance Modification" means any modification(s), revision(s) or
addition(s) to the Products, in object code form, which are released by Vendor
and delivered to Cadence pursuant to Vendor's maintenance obligations under
Exhibit B that are necessary to: (i) correct Errors; or (ii) support new
releases of the Designated Equipment or subsequent revisions of its operating
system; or (iii) update a Product to ensure its continuing compatibility with
versions of Cadence's product(s) it is intended to be used with, if any; or (iv)
other modification(s) or addition(s) which are required under Exhibit B.
Maintenance Modifications shall include updates to the Documentation.
Notwithstanding the foregoing, Maintenance Modifications shall not include any
modification(s), revision(s), upgrade(s) or addition(s) which substantially
change the overall features or functions of the Product(s) without the prior
written consent of Vendor, it being expressly understood that Fire & Ice QX, [*]
are separate products and not Maintenance Modifications of one another.
1.12 "Marketing Agent Commissions" means amounts included in revenue
recognized by Cadence which are actually paid by Cadence under a Marketing Agent
contract as commissions to non-affiliate third party sales representatives for
distribution of the Licensed Works outside the following territories: U.S.,
Canada, Japan
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and European Union.
1.13 "Marketing Agent(s)" means those distributors, dealers, resellers,
representatives, affiliates or Subsidiaries with whom Cadence enters into a
contractual relationship for the express purpose of engaging such entity to
market to End-Users the Licensed Work or other Cadence products which are
included as part of a Bundle with the Licensed Works.
1.14 "Net Maintenance Revenues" means the gross revenues recognized by
Cadence that, subject to the allocation provisions in Section 2.2 of Exhibit C,
are directly attributable to the sale or provision of maintenance services
related to the Licensed Works [*] refunds actually paid to customers (solely to
the extent previously included in revenue and provided that no other amount or
allowance shall be deducted from revenue for refunds), and the amount of
commodity taxes, value added taxes or sales taxes included in such gross
revenues (if any) which are actually paid by Cadence. Such gross revenues shall
be calculated and allocated in accordance with the terms of Exhibit C.
1.15 "Net Product Revenues" means the gross revenues recognized by
Cadence that, subject to the allocation provisions in Section 2.2 of Exhibit C,
are directly attributable to the distribution, license or sublicense of the
Licensed Works [*] refunds actually paid to customers (solely to the extent
previously included in revenue and provided that no other amount or allowance
shall be deducted from revenue for refunds), and the amount of commodity taxes,
value added taxes or sales taxes included in such gross revenues (if any) which
are actually paid by Cadence to the extent that Cadence does not receive a
credit, deduction or other recoupment of such taxes. Such revenues shall be
calculated and allocated in accordance with the terms of Exhibit C.
1.16 "Product(s)" means the Vendor software product(s), in object code
form, as specified in Exhibit A, including any Maintenance Modifications and/or
Enhancements thereto.
1.17 "Subsidiary" means a corporation, limited liability company,
partnership, joint venture, company, unincorporated association or other entity
in which more than fifty percent (50%) of the outstanding shares, securities or
other ownership interest (representing the right to vote for the election of
directors or other managing authority or the right to make the decisions for
such entity, as applicable) is, now or hereafter, owned or controlled, directly
or indirectly, by a party hereto. Such corporation, company or other entity
shall be deemed to be a Subsidiary only so long as such ownership or control
exists.
1.18 "Term" means the initial term and any renewal term of this
Agreement as specified in Section 13.1 below.
2.0 APPOINTMENT.
2.1 Vendor hereby appoints Cadence as its non-exclusive OEM for the
delivery of Licensed Works to End Users world-wide subject to the terms and
conditions of this Agreement, and Cadence hereby accepts such appointment.
2.2 Cadence shall arrange for delivery of Licensed Works to the End
Users and providing End Users maintenance support of Licensed Works, through
Cadence's usual channels for distribution and maintenance in accordance with the
terms of this Agreement. Cadence will pay Vendor the license and maintenance
fees as more fully described in Section 7.
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the Securities and Exchange Commission. Confidential treatment has been
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3.0 RELEASE, DELIVERY AND REPRODUCTION OF PRODUCTS.
3.1 Initial Delivery, Acceptance Tests and Corrections.
3.1.1 Fire & Ice QX. The initial Product under this
Agreement, Fire & Ice QX, has been released and has been reviewed and evaluated
by Cadence prior to the Effective Date. As of the Effective Date, Fire & Ice QX
has been accepted by Cadence for inclusion under the Agreement.
3.1.2 [*]. Upon completion, Vendor shall deliver to Cadence a
copy of [*]. Cadence shall have sixty (60) days after the initial delivery of
such Product to perform such tests in accordance with the test plan under
Section 3.4 which Cadence deems reasonably necessary to determine whether such
version meets the specifications and performance standards set forth in Exhibit
A (the "Acceptance Standards"). Cadence shall promptly notify Vendor if Cadence
determines that such Product does not meet the Acceptance Standards and provide
a detailed description of the non-conformances. Vendor shall then modify or
improve such Product version, at Vendor's expense, so that it performs in
accordance with the Acceptance Standards and to redeliver it to Cadence upon
completion. Cadence shall have a second sixty (60) day test period to reconduct
the acceptance tests. If Cadence determines that the Product does not meet the
Acceptance Standards after such second test period, then the parties shall
repeat the procedure set forth in the two immediately preceding sentences until
such Product meets the Acceptance Standards. Vendor's sole liability for failure
to meet the Acceptance Standards or any target schedules with respect to [*] is
the reduced royalty set forth in Section 1.1 of Exhibit C.
3.1.3 [*]. [*] may, at Cadence's option, be included upon
release. Vendor shall not be required to add such Product to this Agreement if
Cadence has not accepted such Product within twelve (12) months after the
Effective Date or within three (3) months after a beta release is first made
available to Cadence, whichever is later. Neither Party shall have any liability
due to Cadence's election not to include [*] under this Agreement.
3.2 Acceptance Date. Within ten (10) business days after the
Effective Date (in the case of Fire & Ice QX), and within ten (10) business days
of the date on which Cadence notifies Vendor that [*] meets the Acceptance
Standards and/or the date on which Cadence notifies Vendor that Cadence accepts
[*] for inclusion hereunder, Vendor shall deliver to Cadence: (i) one (1)
reproducible gold master copy of the then current released version of the
respective Product in object code format, and (ii) a camera ready hard copy of
the Documentation for such Product, with a collation guide for printing and
reproduction together with an electronic soft copy of the Documentation in
FrameMaker, Word, PostScript format or as otherwise agreed to by the parties.
3.3 Reproduction and Packaging. Cadence shall be responsible, at
its own expense, for all reproduction and packaging of the Licensed Works for
distribution. Cadence shall be responsible for preparing its own end user
documentation and marketing documentation corresponding to the End User
Documentation and Marketing Documentation provided by Vendor. Cadence will
reproduce proprietary rights notices included in the Licensed Works on all
copies.
3.4 Test Plan. Vendor shall work diligently with Cadence to develop
as soon as possible following the execution of this Agreement a test plan
necessary for the development of the acceptance tests to verify [*] conformance
to the Acceptance Standards listed in Exhibit A.
4.0 LICENSE GRANT.
4.1 Distribution License. Vendor hereby grants Cadence a
non-exclusive (except as otherwise set forth in this Section 4), worldwide,
nontransferable (except as permitted in Section 15.4) license (sublicensable to
Cadence's Marketing Agents at any level), for the Term of this Agreement, to
(i) distribute externally the Licensed Works and Ancillary Works, each solely
in object code form, to End Users under the terms and conditions set forth in
Section 4.1.1, and (ii) demonstrate, reproduce and market the Licensed Works
and Ancillary Works as incidental to, and necessary for, such distribution to
End Users. Such license includes the right to distribute the Licensed Works in
object code form with or without other Cadence software products.
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the Securities and Exchange Commission. Confidential treatment has been
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4.1.1 End User Licenses. Licensed Works and Ancillary Works
distributed to End Users shall be licensed subject to signed written end user
license and maintenance agreements which are no less protective than, and may be
the same as, the forms of end user license and maintenance agreements Cadence
uses with respect to the licensing of, and providing maintenance for [*]
proprietary software products, and may permit End Users to copy the Products or
Documentation as is necessary in connection with their internal use of the
Products on the Designated Equipment in accordance with such agreements. Without
limiting the foregoing, such agreements shall include at least the following:
(i) reservation of ownership of the Licensed Works and Ancillary Works, (ii)
reasonable confidentiality provisions for the Licensed Works and Ancillary Works
[*] confidential software products, (iii) reasonable prohibition on modification
and creation of derivative works of the Licensed Works and on disassembling or
otherwise reverse engineering the source code of the Product(s). Cadence agrees
to reasonably enforce the terms of such agreements to ensure compliance and
protect Vendor's rights with respect to the Licensed Works.
4.1.2 Marketing Agents. Cadence's distribution of the Licensed Works
and Ancillary Works through Marketing Agents shall be under signed written
agreements which are no less protective than, and may be the same as, those
which Cadence uses with such Marketing Agents for its own similar proprietary
software products, provided that such agreements shall not permit the Marketing
Agent to market or distribute the Licensed Works and Ancillary Works in any
manner inconsistent with the terms of this Agreement. Cadence agrees to
reasonably enforce the terms of such agreements to ensure compliance and protect
Vendor's rights with respect to the Licensed Works.
4.1.3 Additional Terms; Responsibility for Disclaimers. Cadence
shall be solely responsible for, and Vendor shall have no obligation to honor,
any representations, warranties, maintenance or other terms that Cadence
provides with respect to the Licensed Works beyond those expressly provided by
Vendor under this Agreement.
4.2 Source Code Escrow. With respect to the source code of the Licensed
Work deposited into the escrow account under Section 8.2 hereof, effective
currently but exercisable only if and when such source code is released from
escrow in accordance with Section 8.3 hereof, Vendor hereby grants to Cadence
the non-exclusive, nontransferable (except as permitted in Section 15.4),
irrevocable, perpetual (except where earlier termination is provided in Section
8.3 hereof), worldwide, royalty free, fully paid right and license to modify and
prepare derivative works of the source code, to replicate the source code, and
to use the source code, including such modifications internally, in each case
solely (i) for creating new versions of the Licensed Works which correspond to
Maintenance Modifications and Enhancements that Vendor would have otherwise been
required to develop and release to Cadence hereunder, and (ii) in accordance
with the provisions of Section 9. In no event shall Cadence distribute or
disclose any source code or use the source code for any purpose other than as
required for such maintenance and support purposes. The object code of such new
versions of the Product(s) may be distributed to End Users under maintenance or
if otherwise permitted under Section 8, as included in "Products" in accordance
with the distribution license set forth in Section 4.1.
4.3 Internal Use License. Vendor hereby grants to Cadence a
non-exclusive, nontransferable (except as permitted in Section 15.4),
non-sublicensable, fully paid, royalty-free, worldwide license to use the
defined interfaces of the Product(s) as set forth in the Technical Documentation
to develop Ancillary Works solely for purposes of providing integration and
interoperability with complementary products. Vendor hereby grants Cadence a
non-exclusive, nontransferable (except as permitted in Section 15.4),
non-sublicensable (except as expressly permitted in the following sentence),
worldwide license to internally use the Licensed Works, Technical Documentation
and Marketing Documentation for the purposes of technical support, quality
assurance, manufacturing, testing, demonstration, training, marketing and other
tasks incidental to: (a) carrying out the distribution activities of Section
4.1; and (b) supporting End Users in their use of the Products sublicensed to
them by Cadence and/or its Marketing Agent(s), provided that in each case
Cadence does not receive any fee or generate any revenue in connection with such
activities except (i) Net Product Revenues and Net Maintenance Revenues which
are shared with Vendor as set forth in Section 1.1 and 1.2 of Exhibit C, or (ii)
training fees. Cadence may grant a sublicense under the license in the foregoing
sentence to those Marketing Agents who are distributing the Licensed Works under
Section 4.1 to the extent that Cadence grants the same rights to such Marketing
Agents for Cadence's own similar proprietary products.
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The internal use described in the preceding sentence shall be at no charge or
Fee to Cadence, provided that no fee or revenue is charged in connection with
such activities other than (i) Net Product Revenues and Net Maintenance
Revenues which are shared with Vendor as set forth in Sections 1.1 and 1.2 of
Exhibit C, and (ii) training fees. Internal use under this Section 4.3 does
not include any use of the Product(s) for design services or other commercial
use. Notwithstanding the foregoing, Cadence shall not disclose to any third
party any performance information relating to the Licensed Works except under
terms of confidentiality as necessary to promote sales of the Licensed Works.
4.4 U.S. Government Restricted Rights Legend. The Licensed Works and
Ancillary Works shall only be delivered to a governmental entity as Commercial
Computer Software as defined in DFARS 252.227-7014 (June 1995) or as a
commercial item as defined in FAR 2.101(a) with only such rights as are provided
in Cadence's standard end user commercial license for such software. Technical
data shall be provided with limited rights only as provided in DFARS
252.227-7015 (Nov. 1995) or FAR 52.227-14 (June 1987), whichever is applicable.
Cadence will legend or ▇▇▇▇ Licensed Works provided pursuant to any agreement
with the United States Government or any contractor therefor in a form
sufficient to obtain for Vendor and its suppliers the protection intended by
this Section 4.4.
4.5 Ownership. Title to and ownership of the Licensed Works shall not be
modified by this Agreement and shall at all times remain with Vendor or
Vendor's suppliers. No rights are granted to Cadence or its Marketing Agents,
whether by implication, estoppel or otherwise, except those rights expressly
granted hereunder. Without limiting the foregoing and notwithstanding anything
to the contrary, no rights or licenses are granted under or in connection with
this Agreement to any Intellectual Property Rights of Vendor except to the
extent embodied in, and licensed as a part of, the Product(s) hereunder. Except
as expressly permitted under Sections 4.2 and 8, Cadence shall not in any event
modify, translate, reverse engineer, decompile, disassemble or otherwise reduce
the Licensed Works to human perceivable form or attempt to discover underlying
algorithms or techniques except to the extent that such activities may not be
prohibited under applicable law. Cadence agrees that it will not remove, alter
or otherwise obscure any proprietary rights notices appearing in the Licensed
Works. Title to and ownership of all Ancillary Works shall be retained by
Cadence, subject to the underlying rights of Vendor or Vendor's suppliers.
Except as otherwise provided herein, Vendor and its suppliers, shall have no
rights in, or license to use any Ancillary Works in any manner without the
express prior written permission of Cadence.
4.6 Exclusivity.
4.6.1 Exclusivity. So long as Cadence has and continues to meet all
of the Conditional Obligations set forth in Section 4.6.2, Vendor will
distribute the Product(s) to End Users exclusively through Cadence during the
term of this Agreement unless earlier terminated as set forth below.
4.6.2 Conditional Obligations. Upon inclusion of a Product under this
Agreement as set forth in Section 3, the obligations set forth in this Section
4.6.2 shall apply. Cadence may terminate this Section 4.6.2 upon six (6) months
prior advance written notice to Vendor which specifically references this
Section 4.6.2. Upon such notice, the exclusivity under Section 4.6.1 shall
immediately terminate.
(a) So long as this Section 4.6.2 remains in effect, Cadence shall
market and promote the Licensed Works as Cadence's preferred solution for gate
level interconnect extraction and, subject to the following sentence [*]. If
Cadence accepts [*] for inclusion under this Agreement, Cadence will provide
written notice to Vendor within [*] after initial inclusion indicating whether
[*] will be Cadence's preferred solution [*]. If Cadence does not so elect,
Section 4.6.1 will terminate with respect to [*]. Any updates and upgrades to
any current Cadence extraction products shall be developed independently by
Cadence without reference to or use of the Licensed Works or Confidential
Information of Vendor. Except as expressly set forth in Section 4.6.2(a),
Cadence will not include any other products (except its current extraction
products, HyperExtract and Assura RCX, along with updates and upgrades thereto)
on its price list which compete with or provide substitute functionality for the
Product(s), or distribute or market any such products so long as this Section
4.6.2 remains in effect. Notwithstanding the foregoing, Cadence will not release
any upgrades to HyperExtract after the first anniversary of
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the Effective Date which provide material new features or functionality so long
as this Section 4.6.2 remains in effect.
(b) Commencing [*] after the Effective Date, if the Fees owed by
Cadence to Vendor based on product and maintenance revenue in any [*] are less
than the average [*] amounts paid by Cadence to Vendor for the [*], then Cadence
shall either (i) as part of the preceding fiscal quarters, then Cadence shall
either (i) as part of the scheduled [*] payment, make an additional
non-refundable payment to Vendor in the amount of the shortfall between the
actual fees for such [*] and the average [*] amount paid for the [*]; or (ii)
provide written notice to Vendor that Cadence shall release Vendor from
exclusivity hereunder in lieu of such payment, upon which the exclusivity under
Section 4.6.1 shall immediately terminate. If Cadence fails to make payment for
a shortfall or provide written notice to Vendor as provided in the preceding
sentence, then the exclusivity under Section 4.6.1 shall terminate on the due
date of the scheduled quarterly payment for which Cadence failed to pay such
shortfall. The shortfall payments under this Section 4.6.2(b) may be credited
against subsequent Fees under Sections 1.1 and 1.2 of Exhibit C during the Term
of this Agreement in the same manner as described for Prepaid Fees in Section
1.4 of Exhibit C; provided, however, that [*] under this Agreement shall be used
to [*] required to be made under this Section 4.6.2(b) to maintain exclusivity.
Any such shortfall payments shall be paid in full without any reductions or
credits.
(c) In addition, Section 4.6.1 shall immediately terminate if
Cadence provides notice of termination for [*] under Section 13.2.1 or if
Cadence materially breaches its payment, marketing or other obligations under
this Agreement and fails to cure such breach within forty-five (45) days after
receiving written notice from Vendor.
4.6.3 Exceptions. Notwithstanding anything to the contrary, Section
4.6.1 does not apply to the following:
(a) Separate Products. Section 4.6.1 does not apply to any
Product(s) unless and until such Product(s) have been accepted for inclusion
under the Agreement as set forth in Section 3.1 above and does not apply to any
other products of Vendor which are not included under this Agreement as further
described in Exhibit A.
(b) Existing Vendor Customers. The parties will cooperate in good
faith to transition Vendor's existing customers for the Product(s) to Cadence
for future licenses of such Product(s). Notwithstanding anything to the
contrary, however, Vendor shall have the right, subject to payment to Cadence as
set forth in this Section, to continue distributing the Product(s), Maintenance
Modifications and Enhancements and to continue providing support and maintenance
services to the extent required by its existing agreements and obligations as of
the Effective Date, including any renewals which do not require Vendor's
consent. If Vendor's consent is required for any such renewal, Vendor shall not
consent to such renewal without the prior written consent of Cadence. For any
such existing customers of the Product(s) which require additional copies of the
Licensed Work or renewals of maintenance from Vendor, Vendor shall pay to
Cadence [*] for the license or maintenance of such Licensed Works, calculated
based on Vendor's "net product revenues" and "net maintenance revenues," as
applicable, [*]. Such amounts shall be paid to Cadence in the same time frame as
amounts due by Cadence to Vendor hereunder.
(c) House Accounts for [*]. Notwithstanding any inclusion of [*]
under this Agreement, Vendor shall have the right to distribute all versions of
such Product to up to [*] of the customers listed in Exhibit G, which customers
shall be selected by Vendor prior to [*] in its sole discretion from among the
[*] listed in Exhibit G. The right to distribute such Product to these customers
shall be exclusive to Vendor and Cadence shall not distribute such Product to
the selected customers either directly or indirectly.
(d) Internal Use and Design Services. Notwithstanding anything to
the contrary, Vendor and its Subsidiaries shall have the unrestricted right to
copy, use, and modify the Products for internal use, research and development,
support and maintenance, design services (including those provided to third
parties) and all other
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purposes except distribution of the Product(s) to End Users (other than Vendor,
Vendor's Subsidiaries, its and their contractors, Cadence and Cadence
Subsidiaries).
(e) Authorization by Cadence. Section 4.6.1 will not apply
to any distribution of Licensed Works by Vendor to the extent Cadence authorizes
a customer to obtain Licensed Works from Vendor or otherwise provides
authorization for Vendor to distribute Licensed Works.
(f) Non-Manhattan Products. The exclusivity provisions
hereunder shall only apply to Licensed Works, and the technology included
therein, which are utilized only for "manhattan" style (90 degree) interconnect.
4.7 Use in Professional Services. In addition to the licenses
granted above in Section 4, Vendor grants to Cadence the licenses set forth in
Exhibit E in connection with Cadence's provision of electronic design and
consulting services to customers, which Exhibit E is hereby incorporated herein
by this reference. The parties intend that customers of such Cadence
professional services involving a Licensed Work will separately purchase a
license to the Licensed Work from Cadence. Notwithstanding the foregoing or
Exhibit E, if Cadence or any of its Subsidiaries recognizes any revenue (or
would normally recognize revenue for its own products in similar circumstances)
from the distribution, license or sublicense of the Licensed Work to any World
Wide Services entity (as defined in Exhibit E) or from any maintenance
services, then Exhibit E shall not apply and such revenues shall be included in
Net Product Revenues and Net Maintenance Revenues shared with Vendor hereunder.
5.0 MAINTENANCE, TRAINING AND ENHANCEMENTS.
5.1 Maintenance and Training Services.
5.1.1 Vendor Maintenance and Training Services. Subject to
payment therefor pursuant to Section 5.2, Vendor will provide, during the Term:
(i) to Cadence, the maintenance services described in Sections 1.1 and 1.2.2 of
Exhibit B hereto and the training services described in Section 2.1 of Exhibit B
hereto, (ii) to End Users, the training services described in Section 2.2 of
Exhibit B hereto and, only until the Support Transition Date, the first line
support services described in Section 1.2 of Exhibit B (collectively, "Vendor
Maintenance Services"). Such Vendor Maintenance Services shall not include
providing, and Vendor shall have no obligation to provide, any support or
maintenance services directly to End Users after the Support Transition Date or
to Marketing Agents. All references to Exhibit B include Exhibit B-1 if
applicable.
5.1.2 Cadence Maintenance Services. Except for Vendor's
obligations under Section 1.2 of Exhibit B prior to the Support Transition
Date, Cadence shall provide at its own expense, and shall have sole
responsibility for providing, all technical, service, warranty, return,
telephone, email and other training, maintenance and support services to its
End Users and its Marketing Agents relating to the Products, and shall provide
such services with at least the level and quality of service that Cadence
provides with respect to its own software products. Prior to escalation to
Vendor of any Errors reported to Cadence, Cadence shall perform initial
troubleshooting with respect to such Errors and shall obtain and provide to
Vendor all information and materials from its End Users and Marketing Agents
necessary to identify such Error, to isolate such Error to the Products and to
reproduce such Errors ("Error Information"), and Cadence shall provide Vendor,
and shall obtain from its End Users and Marketing Agents, all support and
assistance required by Vendor to efficiently and effectively provide the Vendor
Maintenance Services. Notwithstanding Section 4.1.1 or any other provision
herein, any commitment by Cadence to provide maintenance and support to any End
User for any period in excess of [*] years after any expiration or
termination of this Agreement shall require the prior written consent of Vendor.
5.2 Maintenance Fees. Vendor Maintenance Services are provided by
Vendor during the first year of this Agreement only. Cadence may purchase
Vendor Maintenance Services from Vendor for the remainder of the Term as set
forth in Section 7.4.
5.3 Maintenance Modifications, Enhancements. Within thirty (30)
days after the execution of this Agreement, each party shall designate, and
notify the other party in writing of, a company representative; both
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persons together shall comprise a steering committee ("Steering Committee")
whose function shall be to evaluate the functionality and overall performance of
the Licensed Works and discuss the potential for additional functionality,
features, Maintenance Modifications and Enhancements with respect thereto. The
parties agree to undertake their respective obligations as may be mutually
agreed by the Steering Committee, including using commercially reasonable
efforts to perform such obligations on the schedule approved by the Steering
Committee. Neither party shall be obligated by any decisions of the Steering
Committee unless such decisions are approved in writing by representatives on
the Steering Committee from both parties. The Steering Committee shall meet at
least once each calendar quarter during the Term of this Agreement in the
performance of its functions. Vendor shall use commercially reasonable efforts
to develop all Maintenance Modifications and Enhancements so agreed upon by the
Steering Committee, in accordance with the schedules and priorities established
by the Steering Committee. In addition, Vendor shall have the right to develop
other Maintenance Modifications and Enhancements of the Product(s) as required
to meet its obligations under Exhibit B and as otherwise deemed appropriate by
Vendor. Vendor shall provide Cadence [*] with a copy of all Maintenance
Modifications and Enhancements of the Licensed Works and related Documentation
which Vendor releases and makes generally available during the term of this
Agreement [*]. Such Maintenance Modifications and Enhancements shall, upon their
availability, automatically become part of the Licensed Work(s) for the purpose
of this Agreement.
5.4 Technology Files. Vendor, at its own expense, will continue to
reasonably cooperate with the following foundry partners to develop and support
Fire & Ice QX technology files: [*].
6.0 MARKETING AND PROMOTION.
6.1 Control of Marketing. Subject to Sections 4 and 6.2, the means by
which Cadence markets and distributes the Licensed Work shall be in Cadence's
sole discretion and control, including without limitation the methods of
pricing, marketing, naming, packaging, labeling, advertising, and collection of
fees. Subject to the terms of this Agreement, Cadence may distribute the
Licensed Work world-wide through any combination of direct marketing, Marketing
Agents, original equipment manufacturers, and other means, and either alone or
in combination with other products.
6.2 Marketing and Distribution Obligations. Cadence shall use reasonable
efforts to:
6.2.1 include the Licensed Works on its price lists, roadmaps, and
marketing plans and to promote and market the Licensed Works to End Users;
6.2.2 make standalone versions of each Licensed Work, and associated
maintenance, generally available on Cadence's price list throughout the Term in
a manner which allows End Users to use other complementary products with the
Licensed Works through the standard interfaces and file formats provided by the
Licensed Works, it being understood that Cadence may also offer bundled
versions;
6.2.3 identify the Licensed Works distributed by Cadence under
product names distinct and separate from other Cadence product offerings
(including, without limitation, Cadence's HyperExtract and Assura RCX products).
6.2.4 Cadence shall not provide the Licensed Works as an upgrade,
update or new version of any other Cadence product, including HyperExtract and
Assura RCX.
6.2.5 provide the following for the Licensed Works in a manner
consistent with Cadence's treatment of its own products: (a) commissions and
training for Cadence's sales force and Marketing Agents, (b) inclusion of the
Licensed Works in Cadence's marketing plans and roadmaps, (c) inclusion of the
Licensed Works on Cadence's web site, and (d) special incentives, programs and
marketing efforts.
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6.3 Referral of Inquiries. Vendor shall refer any inquiries received
by it regarding the use of the Licensed Work for use with Cadence's products to
Cadence and shall notify Cadence of each such referral.
6.4 CADENCE MAKES NO WARRANTY OR REPRESENTATION CONCERNING THE
SUCCESS OF SUCH MARKETING AND DISTRIBUTION EFFORTS. AS SET FORTH IN SECTION
12.1, EACH PARTY AGREES THAT THE OTHER PARTY SHALL IN NO CIRCUMSTANCES BE
LIABLE TO THE OTHER PARTY FOR ANY LOST PROFITS, OR FOR ANY OTHER INDIRECT,
SPECIAL, OR CONSEQUENTIAL DAMAGES ARISING UNDER ANY LEGAL THEORY OUT OF OR IN
CONNECTION WITH THIS AGREEMENT.
6.5 Sales Support. As part of the Vendor Maintenance Services,
Vendor agrees to provide Cadence sales support, including but not limited to
Vendor personnel proficient in the performance, use, implementation and
modification of the Licensed Works and Products (collectively, "Sales Support"),
as Cadence may reasonably require with respect to the sales attempts and other
sales efforts by Cadence and/or its Marketing Agent(s) to sell and market
sublicenses to the Licensed Works and/or Products to customers and/or potential
End Users hereunder, up to a maximum of one (1) full time equivalent person
unless the parties otherwise mutually agree in writing.
6.6 Marketing Support. Vendor agrees to attend [*] marketing events
per year with up to a maximum of [*] of participation by Vendor personnel at
each such event (e.g., industry conferences, business/trade shows, marketing
seminars, presentations and/or demonstration for key customers or strategic
accounts) ("Marketing Support"). Such Marketing Support shall be at no
additional charge to Cadence.
6.7 Trademarks and Copyrights. Vendor hereby grants to Cadence (and
its applicable subcontractors) a non-exclusive license to use the trademarks and
logos set forth on Exhibit F (the "Trademarks") in connection with the
manufacture, distribution, license and promotion of the Licensed Works. [*] the
use of such Trademarks shall conform with all trademark specifications of Vendor
for such Trademarks, which specifications are attached hereto as Exhibit F. If
Cadence manufactures the Products, then Cadence shall cause the manufacture of
the Products to conform to the reasonable quality standards of Vendor for the
manufacture of the Products and Vendor may review the Products manufactured by
Cadence, upon reasonable notice to Cadence, to make sure that such quality
standards are met. Except for the use of the Trademarks however, the packaging
design, and advertising for the Licensed Products shall be within the discretion
and control of Cadence. Vendor represents and warrants to Cadence that it is not
aware and has not received notice of any infringement or claim of infringement
of any Trademark upon any rights of any third party anywhere in the world.
Cadence shall replicate Vendor's copyright notices (as they appear or as
designated by Vendor) in any Product and Documentation reproduced under this
Agreement. Use of Vendor's trademarks shall inure to the benefit of Vendor.
6.8 Drop Shipment. If Cadence does not manufacture the Products and
Vendor drop ships the Products, then the drop shipment box on Exhibit A shall
be checked.
6.9 Press Release. Subject to any applicable legal requirements,
within thirty (30) days after the Effective Date the parties shall jointly
release a press announcement describing the relationship contemplated
hereunder, the form and content of which shall be mutually agreed by the
parties.
7.0 FEES.
7.1 Amount. Cadence shall pay to Vendor Fees relating to the
Licensed Work distributed by Cadence to End Users or Marketing Agents, as
applicable, and maintenance services under the terms of Exhibit C hereto. [*]
If, during the Term of this Agreement, [*] software industry, then, [*] to pay
Fees under Sections 1.1. and 1.2 of Exhibit C (including during any Transition
Period under Section 8.5.2 during such year), [*].
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7.2 Payments, [*] Reports. Fees shall be remitted on a [*] basis within
[*] following the end of [*] for which Cadence recognized revenues to which the
Fee payment applies. Cadence will deliver written reports to Vendor within [*]
stating: (i) the number of licenses and maintenance contracts for each Product
during the [*], the term of such licenses and maintenance contracts, and whether
such licenses and maintenance contracts are standalone or bundled; (ii) the
amount of Net Maintenance Revenues recognized during that [*], and (iii) the
resulting Fees due. Cadence will enclose with the report the Fee payment so
calculated.
7.3 Source Code License Fee.
7.3.1 Upon exercise of Cadence's option to obtain a source code
license under Section 8.5.1 below [*], Cadence shall pay to Vendor a fee in the
amount of (i) [*] to Vendor under Sections 1.1 and 1.2 of Exhibit C and 7.4
prior to the exercise of such option [*]; provided, however, that in no event
shall the amount of such fee [*]. Upon any exercise of Cadence's option to
obtain a source code license under Section 8.5.1 below [*].
7.3.2 If Cadence exercises its option to obtain an expanded
source code license under Section 8.5.1(b) below, [*] in addition to the fees
set forth in Section 7.3.1 above. [*] is not required if Cadence exercises its
option [*] as set forth in Section 7.3.1.
7.3.3 Such fees shall be due and payable up front or in
installments, as determined by Vendor in its sole discretion. Such fees shall be
[*] due under this Agreement.
7.4 Annual Maintenance Fees. Cadence may renew maintenance after the
first year on an annual basis at the rate of [*] ("Annual Maintenance Fees"), to
be paid in equal [*] on the anniversary of the Effective Date and [*]
thereafter. Cadence shall be entitled to [*] to be paid by Cadence under
Sections 1.1 and 1.2 of Exhibit C, provided that such amounts shall be [*]
against Prepaid Fees under Section 1.4 of Exhibit C.
7.5 Taxes. In addition to any other payments due under this Agreement,
Cadence agrees to pay, any all tariffs, duties, governmental permit and license
fees and taxes of whatever nature (including without limitation, sales, use,
excise, withholding, import or export, value added and personal property taxes)
arising out of or related to this Agreement, or any payment, delivery, services,
or distribution or use of Licensed Works under this Agreement, except income
taxes based solely on Vendor's net income.
7.6 Currency Conversion. If any currency conversion is required in
connection with the calculation of amounts payable hereunder, such conversion
shall be the same which Cadence uses to recognize the corresponding revenue in
U.S. Dollars in accordance with generally accepted accounting principles
consistently applied. In no event shall any less favorable conversion be used
for the Licensed Works than any other products of Cadence.
7.7 Late Fees. Cadence shall pay a late fee on all amounts not paid
within [*] of the date due equal to [*] of such outstanding amounts or the [*],
whichever is less.
7.8 Records and Audit. During the term of this Agreement and for a
period of at least [*] thereafter, Cadence agrees that it shall maintain true
and accurate books of accounts and records sufficient to
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establish and confirm the amounts payable, and the information to be reported,
pursuant to this Section 7. Vendor may, with prior written notice and during
normal business hours, have independent certified public accountants reasonably
acceptable to Cadence audit and examine [*] Cadence's records relating to the
Fees payable, and the information reported, pursuant to this Agreement. Such
accountants must agree in advance in writing to maintain in confidence and not
to disclose to any party any information obtained during the course of such
examination, other than a disclosure to Vendor of the amounts of Fees that
should have been paid, and other information that should have been reported, for
the period covered by the examination. If the examination uncovers an
underpayment by Cadence, Cadence shall promptly pay to Vendor the amount of the
shortfall. If the examination uncovers an overpayment by Cadence, Vendor shall
provide a credit in such amount which may be applied solely against future Fees
due under this Agreement. In no event will Vendor be required to pay any amount
to Cadence by reason of such credit. If the amount of the shortfall exceeds [*],
Cadence shall promptly reimburse Vendor for all costs relating to such audit and
inspection (including auditors' and attorneys' fees). The audit right contained
in this Section may not be exercised more than [*] period.
8.9 SOURCE CODE ESCROW AND LICENSE
8.1 Source Materials. As used herein, the "Source Materials" means (i)
the source code developed by Vendor for the then current release of the
Product(s), except as otherwise specified in this Section 8.1 below, and (ii) a
list of (but not the source code for) libraries, field solvers and other third
party software used in the Product(s) ("Third Party Modules"). [*] (other than
generally available compliers, libraries and the like) [*]. Notwithstanding the
foregoing, the Source Materials shall not include any [*] which may be included
in [*], provided that Vendor will make available object code for such [*] is
accepted for inclusion under this Agreement. The parties may agree in writing
upon alternate or additional arrangements for such [*] is accepted for inclusion
under the Agreement.
8.2 Deposit. Within thirty (30) days of acceptance of each Product for
inclusion under the Agreement, Vendor shall, at Cadence's expense, place the
Source Materials for such Product into escrow with an independent third party
escrow holder. The form of escrow deposit agreement to be used is attached
hereto as Exhibit D. Throughout the Term of this Agreement, Vendor shall update
the Source Materials for each major release of the Product(s) as is necessary to
include Maintenance Modifications and Enhancements, so that the deposit reflects
the most current major release of the respective Licensed Work distributed by
Cadence hereunder.
8.3 Release Event. If (a) Vendor (i) materially breaches this Agreement,
including but not limited to, its maintenance obligations under Section 5
hereunder, in a manner that prevents Cadence from exercising its rights or
licenses to the Products under this Agreement without access to the Source
Materials and (ii) fails to cure such breach within [*] after receiving written
notice from Cadence, or (b) Vendor files for or becomes subject to bankruptcy
proceedings and this Agreement is rejected by Vendor or a bankruptcy trustee, or
(c) [*] (the "Release Conditions"), then Cadence may retrieve the Source
Materials from the escrow agent in accordance with the release procedures set
forth in the escrow agreement and may (i) fully exercise its source code license
rights granted in Section 4.2 hereof solely for purposes of support and
maintenance of the Licensed Works, and (ii) if the release event occurred during
the Term, continue to exercise the license grants of Section 4 as if this
Agreement continued in full force and effect for the full Term (initial or then
applicable renewal) as if such Term had continued. Upon release of the source
code from escrow all other terms and conditions of this Agreement shall continue
to apply, except Section 5. Cadence shall continue to pay Fees for the
Product(s) under Sections 1.1 and 1.4 of Exhibit C, including without limitation
for modified versions of the Product(s) developed by Cadence. The license to the
source code granted in Section 4.2 shall be irrevocable, but shall expire at the
later of: (i) [*] following the end of the then applicable Term, or (ii) when
[*] to End Users with respect to the Licensed Work.
8.4 Escrow Termination. The escrow shall continue and survive on its own
terms independent of the
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existence of this Agreement and shall terminate on the earlier of: (i) the [*]
of the termination of this Agreement, if no release event has occurred prior
thereto, (ii) upon termination or expiration of the source code license under
Section 4.2, (iii) exercise by Cadence of its option to obtain a source code
license under Section 8.5, or (iv) such other date as mutually agreed upon by
the parties in writing.
8.5 Option to Obtain Source Code License.
8.5.1 Option.
(a) In addition to the source code release provisions
specified above, Cadence shall also have the option, during the [*] ("Option
Period"), to obtain a license to the then current Source Materials. The option
may be exercised by Cadence by providing written notice of such election to
Vendor and paying to Vendor the license fee set forth in Section 7.3 during the
Option Period. Such license shall be a perpetual, exclusive (solely as provided
in Section 8.5.3), irrevocable, worldwide, non-transferable (except as permitted
in Section 15.4), royalty free (except as set forth in Section 8.5.2) license to
[*]. The license to such Source Materials [*] as further described in Exhibit A.
(b) In the event Cadence pays additional fees as set forth
in Section 7.3.2 as part of the exercise of its option under Section 8.5.1(a),
then [*] continue to be used only as embodied as part of the Source Materials.
8.5.2 Transition Period. Vendor will continue to provide
maintenance services under Section 5 for a period of [*] after the exercise by
Cadence of its option under Section 8.5.1 ("Transition Period"), subject to the
payment of all Fees set forth in Section 7.4 and Sections 1.1 and 1.2 of Exhibit
C during such period. In addition, Vendor agrees to provide [*] of technical
assistance in connection with the transfer of source code hereunder during the
Transition Period. Such assistance shall include, but not be limited to,
telephone, email and on-site support by a member of Vendor's engineering staff
familiar with the source code to be transferred. During the Transition Period,
Cadence shall continue to pay to Vendor [*] for all distribution and maintenance
for the Product(s) under Section 7.4 and Sections 1.1 and 1.2 of Exhibit C,
including without limitation [*]. Notwithstanding Section 13.4, at the end of
the Transition Period, the following provisions of this Agreement shall
terminate: [*]. Section 11 shall terminate [*] after the Effective Date of this
Agreement.
8.5.3 Exclusive Period. Upon Cadence's exercise of the option
to obtain a source code license as provided in Section 8.5.1, the exclusivity
under Section 4.6.1 will continue until the [*] of the Effective Date. During
such period, [*] with Cadence regarding the same. At such [*] in the interests
of both parties. [*].
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9.0 PROTECTION OF CONFIDENTIAL INFORMATION.
9.1 The parties acknowledge that: (i) Licensed Work in the case of
Vendor; and (ii) Ancillary Works in the case of Cadence; and/or (iii) any other
information which the parties desire to exchange to conduct the activities
contemplated by this Agreement, which the revealing party ("Discloser") holds in
confidence or received from a third party under confidentiality obligations
("Proprietary Materials"), are confidential information of the Discloser. Except
as permitted under this Agreement, the receiving party ("Recipient") shall treat
Discloser's Proprietary Materials that are prominently marked with a notice in
human readable form noting their confidential nature, with the same standard of
care that Recipient uses to safeguard its own proprietary materials from
unauthorized access, use, disclosure or dissemination, provided that the
Licensed Works shall be treated as confidential by Cadence whether or not so
marked. Proprietary Materials disclosed orally or visually shall be identified
as confidential prior to the discussion or presentation, then furnished to
Recipient in tangible form within thirty (30) days thereof and marked as
confidential. The Recipient shall not use or disclose such Proprietary Materials
except as expressly authorized under this Agreement.
9.2 Recipient's obligations respecting Discloser's Proprietary Materials
shall terminate with respect to any part thereof which Recipient can establish
by documentary evidence: (i) was not labeled as proprietary at the time of its
receipt by Recipient, provided that this exception does not apply to the
Licensed Works; (ii) now or hereafter may be in the public domain by acts not
attributable to Recipient; (iii) was rightfully in the possession of or known to
Recipient without restriction prior to its receipt from Discloser under this
Agreement; (iv) is or becomes available without restriction to Recipient from a
source independent of Discloser who was in lawful possession of same and
authorized to disclose it to Recipient without restriction; or (v) is agreed to
be unrestricted by Discloser in writing.
9.3 Nothing herein shall restrict Recipient's right to disclose the
Proprietary Materials where such disclosure is required by written order of a
judicial, legislative, or administrative authority of competent jurisdiction, or
is necessary to establish its rights under this Agreement, provided, however
that, in each case, Recipient will first notify Discloser of such need or
requirement and cooperate with Discloser in limiting the scope of the proposed
disclosure. Recipient will assist Discloser in taking all reasonable steps for
obtaining further appropriate means of limiting the scope of the required
disclosure of Discloser's Proprietary Materials, including without limitation
with respect to obtaining protective orders.
9.4 Within ten (10) days of the earlier of (i) receipt of Discloser's
written request for return of same (other than copies of the Licensed Work
distributed to End Users as permitted hereunder), or (ii) the termination or
expiration of this Agreement (except as and to the extent otherwise provided
herein); Recipient shall return all Discloser's Proprietary Materials along with
Recipients certification that through its best efforts and to the best of its
knowledge all Discloser's Proprietary Materials have either been returned or
destroyed and no Discloser Proprietary Materials, or copies thereof, remain in
the possession of Recipient, its employees or agents; provided, however, that
Cadence as Recipient may retain such of Vendor's Proprietary Materials as
Cadence may reasonably require to provide support and maintenance for the
Licensed Works to its customers. Recipient's obligations set forth in this
Section 9 shall terminate on the [*] of the termination or expiration of this
Agreement, excluding those obligations with respect to the Source Materials
which shall terminate [*] of the termination or expiration of this Agreement.
9.5 Source Material Protections. Cadence shall strictly limit access to
Source Materials obtained pursuant to Section 8 to those employees and
independent contractors who require access for purposes permitted under this
Agreement and have entered into written confidentiality agreements consistent
herewith. Cadence shall take reasonable measures to protect the confidentiality
of the Source Materials and any derivatives in source code or human perceivable
form, including those measures which Cadence uses for the source code for its
own products.
9.6 Equitable Relief. Each party acknowledges that unauthorized
disclosure or use of the Proprietary Materials may cause irreparable harm to the
other party for which recovery of money damages would be inadequate, and the
other party shall therefore be entitled to obtain timely injunctive relief to
protect the other party rights under
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this Agreement in addition to any and all remedies available at law.
9.7 Confidentiality of Agreement. Each Party agrees that the terms and
conditions, but not the existence, of this Agreement shall be treated as the
other's Confidential Information and that no reference to the terms and
conditions of this Agreement can be made in any manner without the prior written
consent of the other party; provided, however, that each party may disclose the
terms and conditions of this Agreement: (i) as required by any court or other
governmental body; (ii) as otherwise required by law; (iii) to legal counsel of
the parties; (iv) in connection with the requirements of a public offering or
securities filing; (v) in confidence, to accountants, banks, and financing
sources and their advisors; (vi) in confidence, in connection with the
enforcement of this Agreement or rights under this Agreement; or (vii) in
confidence, in connection with a merger or acquisition or proposed merger or
acquisition, or the like.
10.0 WARRANTIES.
10.1 General.
10.1.1 Vendor warrants and represents that: (i) it has the right
and power to enter into this Agreement and to grant Cadence the rights specified
herein, and that doing so does not violate or conflict with any other Vendor
obligations; and (ii) Vendor shall not assume any obligation or restriction
which would, in any way, conflict with the rights granted to Cadence hereunder
or the services to be performed by Vendor under this Agreement.
10.1.2 Cadence warrants and represents that: (i) it has the
right and power to enter into this Agreement and to grant Vendor the rights
specified herein, and that doing so does not violate or conflict with any other
Cadence obligations; and (ii) Cadence shall not assume any obligation or
restriction which would, in any way, conflict with the rights granted to Vendor
hereunder or the obligations of Cadence under this Agreement.
10.2 Limited Product Warranty.
10.2.1 Vendor warrants and represents that the initial version
of each Product shall, at the time of delivery to Cadence under Section 3 and
for a period of ninety (90) days thereafter ("Warranty Period"), substantially
conform to the specifications set forth in the relevant End User Documentation
provided by Vendor for such Product. It is understood that non-conformities in
any subsequent versions shall be handled under maintenance as set forth in
Section 5 above.
10.2.2 Vendor warrants and represents that the Licensed Work is
designed to be used prior to, during and after the calendar year 2000 A.D., and
that the Licensed Work will operate during each such time period without error
relating to date data, specifically including any error relating to, or the
product of, date data which represents or references different centuries or more
than one century. Without limiting the foregoing, Vendor represents and warrants
that (i) the Licensed Work will properly manage and manipulate data involving
dates, including single-century and multi-century formulas, and will not
abnormally end, or cause an abnormally ending scenario, within the application
or generate incorrect values or invalid results involving such dates; and (ii)
the Licensed Work has been designed to ensure year 2000 compatibility,
including, without limitation, date data century recognition, calculations which
accommodate same century and multiple century formulas and date values, and date
data interface values that reflect the century, and (iii) the Licensed Work
provides that all date-related user interface functionalities and data fields
include the indication of the century, and that all date-related data interface
functionalities include the indication of the century, and (iv) handle all leap
years, including, without limitation, the year 2000 leap year, correctly. Vendor
shall promptly advise Cadence of any breach of the above warranty.
10.2.3 Vendor's sole and exclusive liability, and Cadence's sole
and exclusive remedy, under the limited product warranties set forth in this
Section 10.2 shall be for Vendor to use commercially reasonable efforts to
correct the respective non-conformity in accordance with Exhibit B. This remedy
will apply with respect to the initial version of each Product without regard to
whether Cadence has renewed maintenance under Section 7.5, but shall only apply
to non-conformities properly identified and reported to Vendor during the
Warranty Period. Any other
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Errors may be covered under maintenance as set forth in Section 5 above.
10.3 EXCEPT FOR THE LIMITED WARRANTIES EXPRESSLY SET FORTH IN SECTION
10.2, THE LICENSED WORKS ARE PROVIDED "AS IS" AND VENDOR DISCLAIMS ALL
WARRANTIES, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE LICENSED WORKS,
INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTIES OF MERCHANTABILITY,
NONINFRINGEMENT AND FITNESS FOR A PARTICULAR PURPOSE. VENDOR DOES NOT ACCEPT ANY
RESPONSIBILITY AND SHALL NOT BE LIABLE FOR ANY CADENCE MODIFICATIONS, ANCILLARY
WORKS, BUNDLING OR OTHER DECISIONS WHICH MAY BE MADE BY CADENCE IN CONNECTION
WITH THE USE OF THE LICENSED WORKS. EXCEPT FOR THE WARRANTIES EXPRESSLY SET
FORTH IN SECTION 10.1, CADENCE DISCLAIMS ALL WARRANTIES, EITHER EXPRESS OR
IMPLIED INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTIES OF MERCHANTABILITY,
NONINFRINGEMENT AND FITNESS FOR A PARTICULAR PURPOSE.
11.0 INDEMNITY
11.1 Subject to the limitations set forth in Section 12 below, Vendor
shall defend (or at Vendor's option and expense, settle) and indemnify Cadence
against damages and costs (including, without limitation, reasonable attorneys'
fees) required to be paid to a third party arising from any claim, suit, action,
or proceeding (collectively, a "Claim"), against Cadence to the extent that the
basis of such Claim is that the unmodified Licensed Works infringe any patent,
copyright or trade secret of the third party under the laws of the U.S., Canada,
the European Union or Japan; provided, however, that: (i) Cadence gives Vendor
prompt written notice of such Claim; (ii) Cadence provides proper and full
information and assistance for such defense and does not enter into any
settlement with such third party without Vendor's prior written consent; and
(iii) Vendor has sole control over the defense and settlement of the Claim;
provided, further, Vendor assumes no liability, and shall have no defense or
indemnification obligation, for Claims arising from: (w) a combination of the
Licensed Works, or any part thereof, with any product or technology not provided
by Vendor, including without limitation any Ancillary Works; (x) modification
of the Licensed Works or any portion thereof by anyone other than Vendor; (y)
compliance with specifications of Cadence or the addition of any features or
functionality requested by Cadence or required by the Steering Committee; or (z)
use of other than the current unaltered release of the Licensed Works available
from Vendor, if the infringement would have been avoided by use of the
then-current release made available by Vendor to Cadence. THIS SECTION STATES
CADENCE'S SOLE AND EXCLUSIVE REMEDY WITH RESPECT TO CLAIMS OF INFRINGEMENT OF
INTELLECTUAL PROPERTY OR PROPRIETARY RIGHTS OF ANY KIND.
11.2 Subject to the limitations set forth in Section 12 below, Cadence
shall defend (or at Cadence's option and expense, settle) and indemnify Vendor
against damages and costs (including, without limitation, reasonable attorneys'
fees) required to be paid to a third party arising from any claim, suit, action,
or proceeding (collectively, a "Claim"), against Vendor to the extent that the
basis of such Claim is that an Ancillary Work infringes any patent, copyright or
trade secret of the third party under the laws of the U.S., Canada, the European
Union or Japan; provided, however, that: (i) Vendor gives Cadence prompt written
notice of such Claim; (ii) Vendor provides proper and full information and
assistance for such defense and does not enter into any settlement with such
third party without Cadence's written consent; and (iii) Cadence has sole
control over the defense and settlement of the Claim. THIS SECTION STATES
VENDOR'S SOLE AND EXCLUSIVE REMEDY WITH RESPECT TO CLAIMS OF INFRINGEMENT OF
INTELLECTUAL PROPERTY OR PROPRIETARY RIGHTS OF ANY KIND.
12.0 LIMITATIONS OF LIABILITY
12.1 NEITHER PARTY SHALL BE LIABLE FOR ANY SPECIAL, INDIRECT, OR
CONSEQUENTIAL DAMAGES ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE
DELIVERY, USE, REPRODUCTION OR DISTRIBUTION OF THE LICENSED WORKS UNDER ANY
CIRCUMSTANCES WHATSOEVER, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES.
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SOFTWARE OEM LICENSE AGREEMENT
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12.2 EXCEPT WITH RESPECT TO EXPRESS PAYMENT OBLIGATIONS UNDER SECTION 7, IN
NO EVENT SHALL EITHER PARTY'S TOTAL LIABILITY ARISING OUT OF OR RELATED TO THIS
AGREEMENT [*].
12.3 THESE LIMITATIONS SHALL APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL
PURPOSE OF ANY LIMITED REMEDY.
13.0 TERMS AND TERMINATION.
13.1 Term. The initial term of this Agreement shall be for a period
commencing upon the Effective Date first set forth above and ending four (4)
years thereafter, unless earlier terminated as set forth below. This Agreement
shall subsequently [*] unless terminated by either party, unless either party
provides the other party [*] to the end of the then current term.
13.2 Termination. This Agreement may be terminated at any time as follows:
13.2.1 [*]. By Cadence upon [*], provided that Cadence shall continue
to pay all fees and continue to comply with all terms of this Agreement during
such [*] prior to termination; or
13.2.2 For Cause. By either party at any time immediately upon written
notice to the other party in the event the other party fails to observe or
perform a material obligation of this Agreement (a "Default"), which Default is
not cured within [*] after the non-defaulting party has given written notice of
the Default and demanded its cure.
13.3 Effect of Termination. Upon non-renewal or termination of this
Agreement for any reason, all rights and licenses previously granted to End
Users shall continue in full force and effect in accordance with the respective
end user license agreement entered into prior to termination and Vendor shall
either, at Vendor's option: (i) continue to provide Cadence maintenance and
support services for the Licensed Works as provided in Exhibit B for a period of
up to [*], provided that Cadence continues to pay to Vendor maintenance fees
described in Section 7.4 and Section 1.2 of Exhibit C; or alternatively, (ii)
assume, as licensor directly with End Users, Cadence's obligations respecting
the Licensed Work under any of Cadence's or its Marketing Agent(s)' then current
license and maintenance and support agreements which Cadence or its Marketing
Agents entered into prior to the termination date and receive and retain all
fees under such agreements with respect to any period after the termination
date.
13.4 Survival. The provisions of Section 4.5, 6.4, 9, 11 (for claims
accruing prior to termination), 12 and 15 shall survive the termination or
expiration of this Agreement for any reason. In addition, except in the event of
material breach by Cadence, the source code license under Section 8.5 will
survive to the extent that Cadence has exercised such option and paid all fees
under 7.3 with respect thereto prior to termination.
14.0 CADENCE SOFTWARE.
14.1 Throughout the Term, Cadence shall make available to Vendor, under
Cadence's prevailing terms and prices adjusted by Vendor's "access rate" as of
the Effective Date, any product then offered on Cadence's price list for use by
Vendor in connection with its design services business and the corresponding
maintenance and support services for such product. Cadence shall also provide
the Ancillary Works to Vendor without charge. The terms under which such
products are provided will include the right for Vendor to use the products on
behalf of third parties for whom Vendor is providing design services. Vendor
shall not use any such Cadence software for benchmarking or for developing
competitive software products.
14.2 Cadence hereby grants to Vendor a [*] for
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SOFTWARE OEM LICENSE AGREEMENT
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the purchase of products and services from Cadence, provided that Vendor issues
to Cadence a purchase order within [*] after the Effective Date for software
products and maintenance services from Cadence of [*]. Such credit shall only be
applied against amounts in excess of [*] purchase order. Cadence shall supply
all software products and maintenance services purchased with [*]. The software
products and maintenance services ordered under such purchase order [*] must be
selected by Vendor coincident with the issuance of the purchase order and will
have a term of either [*], as requested by Vendor.
15.0 GENERAL.
15.1 Relationship. The relationship between the parties under this
Agreement is that of independent contractors, and nothing contained in this
Agreement shall be construed to constitute either party as an agent, partner, or
joint venturer of the other.
15.2 Rights. Nothing in this Agreement shall be construed as prohibiting
or restricting: (i) either party from independently developing or acquiring
products which are competitive, irrespective of the similarity to or
substitutability for the Licensed Works; or (ii) the rights which the parties
have outside the scope of this Agreement; or (iii) the rights of either party to
make, have made, use, lease, license, sell or otherwise dispose of any
particular product(s) not herein described.
15.3 Notices. All notices, demands or consents required or permitted
hereunder shall be delivered in writing to the respective parties at the
addresses set forth above, and, in the case of Cadence, to the attention of the
General Counsel, or at such other address as shall have been given to the other
party in writing for the purposes of this clause. Such notices shall be deemed
effective upon the earliest to occur of: (i) actual delivery; or (ii) five (5)
calendar days after mailing (airmail for international mailings), addressed and
postage prepaid, return receipt requested (except for international mailings);
or (iii) one (1) day after transmission by fax, if to Cadence to (▇▇▇) ▇▇▇-▇▇▇▇,
and if to Vendor, to (▇▇▇) ▇▇▇-▇▇▇▇.
15.4 Assignment. Neither this Agreement nor any rights hereunder, in
whole or in part, shall be assignable or otherwise transferable by either party
without the express written consent of the other party.
15.4.1 However, the foregoing notwithstanding, an assignment by
either party in connection with the transfer of all, or substantially all of its
assets, product lines or businesses, whether by reason of acquisition, merger,
consolidation or operation of law, shall not require the other party's consent.
15.4.2 In addition, if Cadence exercises its source code option under
Section 8.5.1 and the Transition Period under Section 8.5.2 has expired, [*]
provided that: (a) Cadence provides written notice to Vendor in advance of such
assignment, and (b) the [*] of this Agreement.
15.4.3 Subject to the above, this Agreement shall be binding upon and
inure to the benefit of the successors and assigns of the parties hereto.
15.5 Severability, Waiver or Amendment. If any Agreement provision is
determined by a court of competent jurisdiction to be contrary to law, the
remaining provisions of this Agreement will continue in effect. No waiver,
amendment or modification of any provision hereof shall be effective unless in
writing and signed by the party against whom such waiver, amendment or
modification is sought to be enforced. No failure or delay by either party in
exercising any right, power or remedy hereunder shall operate as a waiver of any
such right, power or remedy.
15.6 Rights and Remedies Cumulative. Expect as expressly provided herein,
the rights and remedies
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SOFTWARE OEM LICENSE AGREEMENT
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provided in this Agreement shall be cumulative and not exclusive of any other
rights or remedies provided at law, in equity or otherwise.
15.7 Government Provisions. When the Licensed Works are to be furnished
to the United States Government, or, to an End User for use on a subcontract
under a United States Government prime contract (collectively a "Government
Contract"), Vendor agrees to comply with provisions that are contained in the
Government Contract, insofar as Cadence is required by law, regulation or the
terms of the Government Contract to flow down or otherwise made such provisions
applicable to Vendor as a supplier/subcontractor of Cadence, provided that such
provisions are consistent with the ownership and other terms of this Agreement
and Vendor is reasonably able to comply with such provisions in the same manner
as it does for its own customers.
15.8 Excusable Delays; Force Majeure. Except with respect to the payment
of money, neither party shall be responsible for any delay in or failure to
deliver or perform any obligations which is due to circumstances beyond that
party's reasonable control. In the event of any such failure or delay, the time
of performance shall be extended for a period equal to the time lost by reason
of the delay.
15.9 Governing Law. This Agreement is made under, governed by, and shall
be construed in accordance with the laws of the state of
California, excluding
its choice of laws rule, as applied to contracts between
California
corporations entered into and to be performed entirely in
California. The
prevailing party in any judicial action brought to enforce or interpret this
Agreement or for relief for its breach shall be entitled to recover its costs
and its reasonable attorneys' fees incurred to prosecute or defend such action.
15.10 Entire Agreement. The provisions of this Agreement and the Exhibits
hereto, which are incorporated herein by this reference, except for Exhibit D
which is a separate agreement, constitute the entire agreement between the
parties in connection with the subject matter hereof and supersede all prior
and contemporaneous agreements, understanding, negotiations and discussions,
whether oral or written, between the parties hereto with respect to the subject
matter hereof.
15.11 Counterparts. This Agreement may be executed simultaneously in two
or more counterparts, each of which will be considered an original, but all of
which together will constitute one and the same instrument.
15.12 Export. Vendor will notify Cadence from time to time of all export
classifications for the Licensed Works (including ECCNs) and all unusual export
requirements of which they are aware (to the extent different than those
required for Cadence's own similar products). The Licensed Works supplied
hereunder are subject to all pertinent import and export laws of the United
States, including specifically the U.S. Export Administration
Regulations ("EAR"). Cadence agrees that it will be solely responsible for
compliance with all such laws. In particular, Cadence agrees that it will not
export, re-export, or transfer, directly or indirectly, the Licensed Works, to
any person, firm or country on the Denied Persons List, Entity List, Debarred
Parties or Specially Designated Nationals lists or to Afghanistan, Cuba, Iran,
Iraq, North Korea, Federal Republic of Yugoslavia (Serbia only), Sudan, or
Syria or any other country or entity designated by the U.S. Government as
prohibited by U.S. law, or nationals thereof, and that it is not located in
such a country or on such a list. Cadence agrees that it will not transfer,
export or re-export, directly or indirectly, the Licensed Works for use or to
users in military or proliferation activities (Nuclear, Missile, Chemical or
Biological Weapons) without U.S. Government authorization (by export license or
regulation). Cadence agrees to be bound by any future modifications of the
foregoing list of restricted destinations by amendments to the EAR or other
U.S. government regulations.
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IN WITNESS WHEREOF the parties have entered into this Agreement
effective as of the year and date first set forth above.
CADENCE DESIGN SYSTEMS, INC. VENDOR
By: /s/ Lavi A. Lev By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------ -----------------------------
Name: Lavi A. Lev Name: ▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------- --------------------------
Title: E.V.P. G.M. IC Solutions Title: President/COO
-------------------------- -------------------------
Date: 1/11/02 Date: 1/11/02
--------------------------- --------------------------
CADENCE DESIGN SYSTEMS (IRELAND) LIMITED
By: /s/ ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------
Name: ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------
Title: Sr. V.P. & General Counsel
--------------------------
Date: 1/11/02
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EXHIBIT A
PRODUCTS AND DESIGNATED EQUIPMENT
REF: Software OEM Agreement
Dated:
================================================================================
1. DESCRIPTION OF PRODUCTS AND DOCUMENTATION.
- Fire & Ice QX
- [*]
- [*]
1.1 [*]. The [*] are attached hereto as Exhibit A-1.
1.2 New Products. If Vendor develops or commercially offers a new program
("New Product") that may be complementary to either the above Products or other
programs marketed by Cadence, then, upon written request from Cadence, the
parties will discuss in good faith the possibility of Cadence marketing the New
Products as mutually agreed. Except as may be otherwise mutually agreed by the
parties in writing, Cadence will have no rights to market any such New Products
under the terms of this Agreement or otherwise. The terms applicable to any
marketing by Cadence of any New Product shall be as mutually agreed by the
parties in writing and may be different from the terms of this Agreement [*].
1.3 Other Vendor Products. Notwithstanding anything to the contrary in
this Agreement, the Product(s) do not include any of Vendor's other current or
future products, and specifically exclude (i) current and future versions of
VoltageStorm, SubstrateStorm, DelayStorm, QuickCap and other value added
products (whether or not using shared modules from the Product(s)); and (ii) any
products which include features or capabilities for processing non-manhattan
interconnect (i.e., interconnect other than the conventional manhattan
architecture whereby interconnect runs parallel/perpendicular to the edges of
the die and perpendicular to adjacent layers of interconnect). In no event shall
Vendor be required to deliver or license any such products to Cadence nor shall
any restrictions or obligations of Vendor under this Agreement apply to any such
products.
2. DESIGNATED EQUIPMENT.
The Product(s) shall operate on the following equipment product families
and operating systems: [*]. Vendor will use commercially reasonable efforts to
support new versions of such operating systems at the same time that production
releases of the programs that Cadence offers on such equipment generally support
such new versions. Additional equipment and operating systems may be added by
the Steering Committee from time to time. In addition, Vendor agrees to use
commercially reasonable efforts to port the Licensed Works to Cadence's database
currently known as [*] within [*] after the API for [*] is provided to Vendor.
Cadence will provide information and assistance reasonably required by Vendor
for such porting.
3. DROP SHIPMENT (NOT APPLICABLE).
[ ] If the box is checked the parties agree that Vendor will drop ship the
Products to End Users (or Marketing Agents, as applicable) worldwide, as
designated by Cadence from time to time, and at no charge to Cadence.
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EXHIBIT A-1
[*]
The objective of this exhibit is to describe [*] for the purpose of specifying
Acceptance Standards.
[*]
* Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
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EXHIBIT B
MAINTENANCE AND SUPPORT SERVICES
REF: Software OEM Agreement
Dated:
================================================================
1.0 MAINTENANCE.
1.1 FOR CADENCE.
1.1.1 Error Correction. After receiving the Error Information
from Cadence, and provided that Cadence otherwise complies with its obligations
in Section 5.1.2, Vendor will use commercially reasonable efforts to provide a
Maintenance Modification or other solution to correct any Errors in the Licensed
Works reported by Cadence, provided that Vendor makes no warranty that it will
correct all Errors. Such response shall include as appropriate: (i) reviewing
the Error with Cadence; and (ii) gathering, or requesting that Cadence gather,
additional information about the Error; and (iii) analyzing the Error to
determine its cause; and (iv) providing an Error solution if already known; and
(v) where required providing a Maintenance Modification; and (vi) where required
providing Documentation changes. Maintenance Modifications will be delivered to
Cadence promptly after completion by Vendor at no additional cost. Vendor shall
provide Cadence with an estimate of how long Vendor expects it will take to
correct the Error(s) reported by Cadence and shall keep Cadence informed of the
progress of the problem resolution.
1.1.2 Error Classification & Response: Cadence will notify
Vendor when Errors are discovered. Cadence and Vendor will classify Errors by
severity as: "Fatal", preventing a Product from performing any useful work; or
"Severe Impact", disables major function(s); or "Degraded Operations", Errors
disabling non-essential functions; or "Minor", all other Errors. Vendor shall
use reasonable efforts to provide the following response levels defined as
follows in accordance with the timetable set forth below, wherein a day shall
mean a business day; (i) Level 1, Cadence's receipt of Vendor's written
confirmation acknowledging Vendor's receipt of the Error report; and (ii) Level
2, Cadence's receipt of Vendor's patch, workaround or temporary fix including
Documentation changes; and (iii) Level 3, Cadence's receipt of Vendor's official
fix or update, including applicable Documentation changes. The
response/correction timetable shall be as follows, wherein a day shall be
considered to be a workday:
Response/Correction Timetable
Severity ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇
-------- ------- ------- -------
Fatal [*] [*] [*]
Severe Impact [*] [*] [*]
Degraded Operations [*] [*] [*]
Minor [*] [*] [*]
1.1.3 Telephone Support: Provide telephone support to Cadence on
an as-needed basis. Vendor shall maintain a toll-free telephone hotline service
which, at a minimum, must be attended during the hours from 8:00 a.m. to 5:00
p.m. Pacific Standard Time.
1.1.4 Annual Review of Maintenance and Product Utilization. At
least annually, Vendor shall provide a qualified specialist without additional
charge to review maintenance and Cadence's system performance and utilization
for each Product. A written report will be furnished to Cadence delineating ways
Cadence might improve maintenance and the utilization of the Products in
Cadence's product environment, provided that the total hours for the services
under this Section shall not exceed [*] for each year. Unused hours will not be
carried forward to
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subsequent years.
1.1.5 Such maintenance services shall be without charge to Cadence
during the first year of this Agreement, provided however that Cadence shall pay
to Vendor (i) the Maintenance Fees set forth in Section 7.4 of this Agreement
for subsequent years, and (ii) the Fees specified in Sections 1.1 and 1.2 of
Exhibit C for all years.
1.1.6 Vendor shall provide to Cadence reasonable advance notice of any
planned Maintenance Modification or Enhancements to the Product(s) promptly
after such plans are finalized by Vendor to the extent necessary for Cadence to
adapt its interface programs to the revised Product(s).
1.2 FOR END USERS:
1.2.1 Until Support Transition. From the Effective Date of this
Agreement through and including the six (6) month anniversary of the Effective
Date (the "Support Transition Date"), or such other date as mutually agreed
upon by the parties in writing, Vendor shall be responsible for providing "first
line" maintenance and support services in accordance with the terms and
conditions of the End User Software Maintenance Agreement attached hereto as
Exhibit B-1 (Cadence's standard end user software maintenance agreement)
directly to End Users who have entered into such End User Software Maintenance
Agreement with Cadence.
1.2.2 After Support Transition. Beginning on the Support Transition
Date, or such other date as mutually agreed upon by the parties in writing,
Cadence shall be solely responsible for providing "first line" maintenance and
support services directly to End Users in accordance with the terms and
conditions of the End User Software Maintenance Agreement attached hereto as
Exhibit B1. During this time, Vendor shall continue to provide "second line"
maintenance and support services to Cadence, consistent with the terms and
conditions of Section 1.1 of this Exhibit B, and such other maintenance and
support services as the parties may mutually agree to assist Cadence in
fulfilling and satisfying its maintenance and support obligations to End Users,
on pricing and other terms mutually agreed upon by the parties prior to Vendor
providing such services.
1.3 EXCLUSIONS. Vendor shall have no obligation to support: (i) any
Product if Cadence has elected not to renew Vendor Maintenance Services under
Section 7.4; (ii) altered, damaged or substantially modified Products not caused
or modified by Vendor; (iii) Products that are not the then-current or previous
sequential release, where such release was made available to Cadence under this
Agreement; (iv) Errors caused by hardware malfunction, or by negligence, misuse
or misapplication by any party other than Vendor; (v) use of the Products not in
accordance with the Documentation or Vendor-provided training, or other causes
beyond Vendor's reasonable control; (vi) Products installed in a hardware or
operating environment other than that specified by Vendor as compatible with the
Products; (vii) third party components; or (vii) use of the Products outside the
scope permitted under this Agreement or the respective end user license.
1.4 FEEDBACK. Except as required for maintenance services or porting
requested by Cadence, Cadence is not required to disclose to Vendor any
suggestions for correction or enhancement of the Products or any improvements
which enhance the use or implementation of the Products (collectively,
"Feedback"). If Cadence discloses such Feedback to Vendor, or obtains any
patents on such Feedback, then Vendor shall have a perpetual, non-terminable
license to use such Feedback in connection with its products and services and to
make, have made, use, sell, modify, sublicense, copy, distribute and otherwise
exploit its products and services with such Feedback.
2.0 TRAINING
2.1 Cadence Internal. Prior to the first anniversary of the Effective
Date, Vendor shall provide training to Cadence and its Marketing Agents'
engineering, operations, customer service and application engineering personnel.
Such training shall cover, without limitation, the following topics in detail:
(i) installation and configuration procedures, (ii) operating, usage and
performance characteristics of the Product, (iii) Error diagnosis and isolation.
Such training shall be without charge to Cadence, shall consist of at least [*]
course per [*], and
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shall be conducted at Cadence's facilities with such schedule as is mutually
agreeable, except however Cadence shall reimburse Vendor for its out of pocket
costs for the instructor's travel, lodging and meal expenses for training held
at Cadence's facilities. Any unused training hours will not be carried forward
to subsequent months. Additionally, if any of the foregoing topics are covered
in regularly scheduled classes held at Vendor's facilities, then Cadence or its
Marketing Agents' personnel who are engaged in the marketing, sales, integration
or support of the Products may attend any such course(s) at no charge, provided
however Cadence shall be responsible for the travel and living expenses of its
course attendees, and provided further that Cadence and its Marketing Agents
shall be limited to a maximum of [*] attendees for all such classes offered in a
given [*]. Any unused seats will not be carried forward to subsequent months.
2.2 End User training. Vendor shall make available training to End
Users for the Licensed Work. Such training shall be available by the End
User(s)' attendance at standard classes which Vendor offers. All training to
End Users shall be at Vendors established, published and advertised prices.
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EXHIBIT B-1
END USER SOFTWARE MAINTENANCE AGREEMENT
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SOFTWARE MAINTENANCE AGREEMENT
STANDARD TERMS AND CONDITIONS
THIS SOFTWARE MAINTENANCE AGREEMENT ("Agreement") is made ______ day of
_________, 200_, between Cadence Design Systems, Inc. ("Cadence"), and the
undersigned, ("Customer"). Customer and Cadence desire and intend that this
Agreement establish the terms and conditions between them for all transactions
for maintenance of Cadence's software products. Therefore, Cadence and Customer
agree as follows:
1. MAINTENANCE SERVICES.
Definitions in the Cadence Software License Agreement apply herein. (a) Cadence
will provide remedial and preventive maintenance services ("Maintenance
Services") to keep the most current release of the Licensed Program(s) licensed
by Customer under a Cadence Software License Agreement "SLA", in good operating
condition. (b) Cadence will keep available telephone assistance to Customer
between 8:00 a.m. and 5:00 p.m., prevailing local time Cadence Service
Facilities, Monday through Friday, excluding Cadence recognized company
holidays. (c) Cadence will provide appropriate assistance to Customer within a
reasonable period after Customer adequately describes a Licensed Program and/or
Documentation problem to Cadence's Customer Support Organization. Such
assistance will be at Cadence's expense where it determines that the reported
problem is due to defects in an unaltered most current version of a Licensed
Program or its Documentation. If it determines that the reported problem is not
due to a Licensed Program, if Customer requests and Cadence agrees to provide
the requested service, Customer agrees to pay Cadence's then current prices for
services Cadence provides to correct such problem. (d) If Customer makes
modifications, interfaces, and/or other changes to the Licensed Program and
Documentation if permitted under the SLA, Customer shall promptly inform Cadence
in writing and provide such information as Cadence determines necessary to
properly maintain the Licensed Program and Documentation. (e) Cadence's
obligation to provide Maintenance Services pursuant to this Agreement is
dependent upon:
(1) the existence of a SLA in effect between Cadence and Customer;
(2) Customer's continued good repair of the Designated Equipment; and
(3) the performance by Customer of all of its obligations set forth in the
SLA and in this Agreement.
(f) Cadence shall not be obligated to provide Maintenance Services pursuant to
this Agreement that are required by any of the following:
(1) abuse, misuse, accident or neglect; or
(2) repairs, alterations, and/or modifications which are not permitted
under the SLA and which are performed by other than Cadence or its agents; or
(3) use of materials not meeting Cadence's requirements; or
(4) use of the Licensed Program for other than the intended purpose for
which licensed and designated; or
(5) malfunction, modification or relocation of the Designated Equipment
from the Designated Sites; or
(6) where inadequate backups are supplied.
(g) Cadence may refuse to provide Maintenance Services where, in Cadence's
opinion, a condition exists that represents a hazard to the safety of its
employees or agents.
(h) Licensed Programs are licensed for use on a specific hardware unit
("Designated Equipment"), and as indicated in the License Agreement, a Licensed
Program may only be transferred to another hardware unit upon prior approval of
Cadence and after (a) payment of the appropriate transfer fees and (b) if the
maintenance coverage for the target re-host product has lapsed, the applicable
re-certification fee has been paid.
2. INITIAL TERM; COMMENCEMENT; RENEWAL. This Agreement is intended to
commence at the time of shipment of the Licensed Program(s). Maintenance
Services shall commence on the business day following software installation
subject to the approval of Cadence and payment in advance of the applicable
fee(s). Unless otherwise specified in a product quotation from Cadence, this
Agreement shall have an initial term of one (1) year. Upon issuance of a
Customer purchase order prior to the expiration of the initial term or any
renewal term, acceptance by Cadence of such purchase order and payment by
Customer of the applicable fees, this Agreement shall renew for successive
periods (for the term specified in a product quotation) unless terminated by
Cadence per Section 11. If there has been any lapse of Maintenance Services,
such Maintenance Services will commence only after an evaluation by Cadence of
Customer's current status, payment of applicable fees, and, if necessary,
updating of the Licensed Program(s) to a serviceable revision. Customer shall
pay Cadence's software update charges where applicable. Maintenance Services
renewal is contingent on current payment of maintenance fees, Customer not being
in default hereunder or under the SLA, and a valid Customer order.
3. PRICES AND TERMS OF PAYMENT. The prices set forth on the Product Quotation
apply to the initial term. Cadence will advise Customer at least thirty (30)
days prior to the expiration of a term of the prices applicable to the
subsequent term. Each annual installment is due and payable in advance, net
thirty (30) days from invoice date. Delivery is to be made F.O.B point of
shipment. Shipping charges, including insurance, shall be paid by Customer. Risk
of loss shall pass to Customer upon delivery to carrier.
29
4. TAXES. Customer will pay or reimburse all federal, state and local taxes
(exclusive of taxes on Cadence's net income), duties and assessments arising on
or measured by amounts payable to Cadence under this Agreement.
5. ADDITIONAL SERVICES. If Cadence agrees to perform services requested by
Customer which are not included as part of this Agreement, such services shall
be billed to Customer at prices and terms determined by Cadence.
6. UPDATES AND NEW PRODUCTS. Updates, consisting of one copy of modifications
and improvements to each Licensed Program and/or Documentation which Cadence
determines are required to achieve the specifications established by Cadence
for the Licensed Program and/or Documentation will be provided at no additional
cost. Customer acknowledges that Cadence will maintain only the most current
version of the Licensed Program. Cadence shall maintain prior versions until
the earlier of 6 months from the release of each new version release, or
termination of this Agreement. Upon receipt and installment of an update to a
Licensed Program, Customer may keep one copy of the previous version of the
Licensed Program for archival purposes only and shall destroy all other copies
of the previous version of the Licensed Program. New products are determined
and defined solely by Cadence and are not covered by the fees already paid by
Customer.
7. EXCLUDED SERVICES. Cadence does not itself provide hardware maintenance
unless the same is pre-arranged for a fee. In addition, services connected with
relocation of the Licensed Program from the Designated Equipment or
reconfiguration of same or Customer induced problems associated with the
Designated Equipment are excluded. The cost of tools, supplies, accessories,
media, and other expendables required by Cadence to perform the Maintenance
Services are excluded. Maintenance Services outside the contiguous United
States that would otherwise be covered by this Agreement are excluded.
8. CUSTOMER RESPONSIBILITIES. Customer shall:
(a) Notify Cadence promptly by Cadence designated electronic problem reporting
software or telephone of Licensed Program problems and provide follow-up
reports in writing. Cadence will confirm receipt of any electronic problem
report within twenty-four (24) hours of receipt and, in the absence of such a
confirmation, Customer shall promptly re-transmit such report;
(b) Allow Cadence full and unrestricted access to all Designated Equipment at
the Designated Sites and other communication facilities and provide Cadence
reasonable workspace and storage and other normal and customary facilities;
(c) Provide Cadence with reasonable assistance as requested and insure that an
employee of Customer is present during Service;
(d) Provide sufficient support and test time on Customer's computer system to
duplicate the problem, certify that the problem is due to the Licensed Program
and, when repairs are complete, certify that the problem has been repaired;
(e) Provide the same standard of care for Licensed Programs and/or
Documentation that it applies to its own products or data of like nature and
value and return any defective Licensed Programs and/or Documentation or attest
in writing to the destruction of same as directed by Cadence
(f) Provide sufficient data to Cadence to reproduce the problem on another
computer at Cadence's Customer Support Center. Cadence will retain a copy of
the data to use for validation of future releases of Cadence Products unless
specifically directed not to do so in writing by Customer.
9. RELOCATION OF DESIGNATED EQUIPMENT. Customer shall notify Cadence in writing
not more than thirty (30) days prior to moving the Designated Equipment from
the Designated Sites as to its intended new location. Cadence shall be under no
obligation to provide any services under this Agreement during or as a result
of such relocation.
10. PROTECTION OF LICENSED MATERIALS. Each Licensed Program and Documentation
are the confidential and proprietary property of Cadence or third parties from
whom Cadence has obtained rights. Customer receives no rights to and will not
sell, assign, lease, market, transfer, encumber, or otherwise suffer to exist
any lien or security interest (other than those of Cadence) on, nor allow any
third person, firm, corporation, or other entity to copy, reproduce or disclose
in whole or in part in any manner the Licensed Program or Documentation.
Customer receives no rights to and shall not create nor attempt to create by
reverse engineering, reverse assembly, reverse compiling any part of the
sourcecode from any such Licensed Program or Documentation or permit any third
party to do so. Customer shall take all reasonable steps, both during and after
the term of this Agreement, to insure that no unauthorized person(s) shall have
access to the Licensed Program or Documentation and that no unauthorized copy,
in whole or in part, in any form shall be made.
11. TERMINATION. Cadence may terminate this Agreement immediately upon default
by Customer hereunder or under the SLA. Where a new version of a Licensed
Program has been offered to Customer, Cadence may terminate Maintenance
Services of the old version of such Licensed Program under this Agreement six
(6) months after first commercial shipment to Customer of such new version if
Customer has not installed such version.
12. DEFAULT. Failure of Customer to perform its obligations hereunder or under
the SLA, including, without limitation, timely payment in full of all fees or
the insolvency, bankruptcy, reorganization, assignment for the benefit of
creditors, or dissolution, liquidation, or winding up of the business shall
constitute a default under this Agreement.
13. FORCE MAJEURE. Cadence shall not be liable for any loss, damage, or
penalty resulting from delay due to causes beyond its control, including,
without limitation, delays by its suppliers.
30
14. NO ASSIGNMENT. Customer shall not assign, delegate, or subcontract any
portion of its rights, duties, or obligations under this Agreement and any
attempt to do so shall be void.
15. NO WARRANTY.
IN CONNECTION WITH THE SERVICES RENDERED AND COMPUTER SOFTWARE AND DOCUMENTATION
SUPPLIED UNDER THIS AGREEMENT, CADENCE MAKES NO WARRANTY, EXPRESS OR IMPLIED,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE
OR OF MERCHANTABILITY OR OF NON-INFRINGEMENT.
16. LIMITATION OF LIABILITY.
CADENCES CUMULATIVE LIABILITY UNDER THIS AGREEMENT FOR ALL CAUSES OF ACTION
SHALL BE LIMITED TO AND NOT EXCEED THE MAINTENANCE SERVICES FEE PAID BY
CUSTOMER, REGARDLESS OF WHETHER CADENCE HAS BEEN ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES OR THAT ANY REMEDY SET FORTH HEREIN FAILS OF ITS ESSENTIAL PURPOSE
OR OTHERWISE. CADENCE SHALL NOT BE LIABLE FOR COSTS OF PROCUREMENT OF SUBSTITUTE
SERVICES, LOSS OF PROFITS, INTERRUPTION OF BUSINESS, OR FOR ANY OTHER SPECIAL,
CONSEQUENTIAL OR INCIDENTAL DAMAGES, HOWEVER CAUSED, WHETHER FOR BREACH OF
WARRANTY, CONTRACT, TORT, NEGLIGENCE, STRICT LIABILITY OR OTHERWISE. CUSTOMER
ACKNOWLEDGES THAT THE MAINTENANCE FEE REFLECTS THIS ALLOCATION OF RISK.
17. NOTICES. Notices to Customer shall be sent to the address specified
beneath Customer's signature below and to Cadence shall be sent to: ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn: Legal Department, or such new address
as a party specifies to the other in writing.
18. GOVERNING LAW. This Agreement will be governed by the procedural and
substantive laws of the State of
California, U.S.A., without regards to its
conflicts of laws principles. This Agreement is prepared and executed and shall
be interpreted in the English language only, and no translation of the
Agreement into another language shall have any effect. The parties agree that
the United Nations Convention on Contracts for the International Sale of Goods
(1980) is specifically excluded from and shall not apply to this Agreement.
19. GENERAL. This Agreement is the complete and exclusive statement of the
agreement between the parties and supersedes all proposals, oral or written,
and all other communications between the parties relating to the subject matter
hereunder. Any terms and conditions of any purchase order or other instruments
issued by Customer in connection with this Agreement which are in addition to,
inconsistent with, or different from the terms and conditions of this Agreement
shall be of no force or effect. This Agreement may be modified only by a
written instrument duly executed by authorized representatives of Cadence and
Customer. Any waiver by either party of any condition, part, term or provision
of this Agreement shall not be construed as a waiver of any other condition,
part, term or provision or a waiver of any future event or circumstance. If any
provision of this Agreement is held invalid or unenforceable then the remainder
of the Agreement shall continue in full force and effect.
-- END OF TERMS --
31
This Agreement shall be effective and binding on the parties only after
acceptance at Cadence's offices in
California and signed by an Officer thereof.
CUSTOMER: ___________________________ CADENCE DESIGN SYSTEMS, INC.
(Print Name)
By: _________________________________ By: _________________________________
Name: _______________________________ Name: _______________________________
Title: ______________________________ Title: ______________________________
Date: _______________________________ Date: _______________________________
ADDRESS: _________________________________
32
EXHIBIT C
FEES AND PAYMENT
REF: Software OEM Agreement
Dated:
================================================================================
1. FEES.
For each [*] during the Term of this Agreement (and thereafter as
applicable), Cadence shall pay Vendor the following amounts in Fees based upon
Cadence's [*] and [*], which shall be calculated as follows:
1.1 Rates. (QX and [*]) For each [*] during the Term, Cadence shall pay
Vendor an amount equal to [*] of the [*] recognized by Cadence for [*]. However,
if Vendor does not make available to Cadence a version of [*] which meets the
standards set forth in Exhibit A prior to [*], then such percentage shall be
reduced to [*] for amounts first recognizable for Fire & Ice QX after [*] until
Vendor makes such version available or Cadence otherwise accepts [*] for
inclusion under the Agreement, whereupon such percentage shall immediately
revert to [*] for all amounts recognizable thereafter.
([*]) For each [*] during the Term, Cadence shall pay Vendor
an amount equal to [*] of the [*] received by Cadence during [*].
[*] shall be adjusted as set forth in Section 2 of this
Exhibit C prior to the application of such percentages.
1.2 Maintenance Revenues. For each [*] quarter during the Term and
thereafter for so long as Vendor has maintenance obligations to Cadence under
this Agreement, Cadence shall pay Vendor an amount equal to [*] of the [*]
received by Cadence during [*]. [*] shall be adjusted as set forth in Section 2
of this Exhibit C prior to the application of such percentage.
1.3 Prices. The parties agree that Cadence shall be free to determine
its prices to its customers.
1.4 [*]. Cadence shall pay to Vendor a total of [*] due and payable on
the dates and in the amounts set forth below:
[*]: $[*]
[*]: $[*]
[*]: $[*]
[*]: $[*]
[*]: $[*]
Prior to the [*] of the Effective Date, Cadence may [*] to Vendor under Sections
1.1 and 1.2 of this Exhibit C; provided that, in no event shall [*]. Cadence
shall not be entitled to [*], even if Cadence fails to [*] before such date. The
[*] any Maintenance Fees under Section 7.4 of the Agreement, any Fees paid by
Cadence under Section 8.5.2, or any other amounts to be paid by Cadence to
Vendor under the Agreement other than those under Sections 1.1 and 1.2 of this
Exhibit C. [*].
2. EXCLUSIONS/ADJUSTMENTS TO FEE AMOUNTS.
* Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
33
2.1 Exclusions. No Fees shall be due hereunder for copies of the
Products and/or Licensed Works made available without charge which are: (i) made
and used pursuant to the internal use licenses of Section 4.3 of this Agreement;
or (ii) made temporarily available for up to [*] to prospective End Users for
demonstration or evaluation, but in no event (a) for commercial production use,
or (b) in any manner more extensive than Cadence does for its own products; or
(iii) distributed to existing End User(s) under terms of warranty or maintenance
as back-up, replacement or update copy for such End User(s)' existing copy(ies)
of the Licensed Works, provided that Vendor shall be paid for the Net
Maintenance Revenue from such End User(s); or (iv) licensed to any other End
User where Cadence and Vendor mutually agree in writing that the Licensed Works
should be provided to such End User at no charge. At the request of Cadence,
Vendor will consider charitable contributions to non-profit institutions as
mutually agreed in writing. This Section 2.1 is intended solely for legitimate
distribution of the Licensed Works in support of maximizing opportunities for
the Licensed Works in the same manner as Cadence's own products, and in no event
shall be used to widely distribute copies without charge.
2.2 Bundling. If any Licensed Work is bundled, combined or otherwise
integrated by Cadence with any other products ("Bundles"), the Fees shall be
calculated using the following principles: (a) the Licensed Work and related
maintenance services will not be subject to a discount different than that which
is applied to other Cadence products with which it is sold; and (b) the Licensed
Work and related maintenance services will [*] for any customer to purchase
other products or services. Bundling or combining may include products with
separate price book listings. All Net Product Revenues and Net Maintenance
Revenues received for Bundles shall be fairly allocated to the Licensed Work. In
no event shall the amount allocated to the Licensed Work be less than a [*] of
the products in the Bundle, provided that, for purposes of such allocation, the
list price for the Licensed Work shall be no less than Vendor's standard list
price for the Licensed Work effective at the time such licenses are granted
("Vendor List Price").
2.3 Standalone Sales. If the Licensed Work is sold on a standalone
basis, (a) the Licensed Work and related maintenance services will not be
subject to a discount greater than that which is applied to any other Cadence
products sold to the respective customer, and (b) the Licensed Work and related
maintenance services will [*] for any customer to purchase other products or
services.
2.4 Remix. Vendor shall only be entitled to be paid Fees in subscription
type transactions of Cadence in the event that [*]. In addition, [*]. Vendor
understands that in certain types of subscription transactions ("Fixed term
transaction") the customer shall not be entitled to remix any Licensed Work
unless the respective Licensed Work is included within the Cadence local price
book in effect as of the effective date of such Fixed term license.
2.5 Non-Arm's Length Sales. For any transaction which is not a fully
arm's length cash transaction, the Net Product Revenue and Net Maintenance
Revenue used to calculate Fees shall be [*] received by Cadence in equivalent
fully arm's length cash transactions during the [*]. For purposes hereof,
non-arm's length transactions shall be any transaction or series of transactions
with a Cadence Subsidiary or affiliate or where Cadence receives consideration
other than cash payments for the Licensed Work and associated maintenance shared
with Vendor as set forth above.
2.6 Cadence List Price. Cadence will set the Cadence list price for the
Licensed Works in a manner consistent with the mechanisms and methods used by
Cadence in setting its other list prices, including application of any
discounts.
2.7 Vendor List Price. The Vendor List Price is established hereunder
for determining [*] to be paid to Vendor and not for establishing actual prices
to customers. Either party may recommend changes to the Vendor List Price for
the Licensed Works within the first [*]. If either party recommends a change,
then the parties shall negotiate the relevant Vendor List Price in good faith.
If the parties are unable to mutually agree on a Vendor List Price for the
relevant Licensed Work within twenty (20) days after any change is
* Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
34
recommended by a party, then the parties shall submit the determination of the
Vendor List Price to a mutually agreeable independent third party arbitrator who
is an expert in the industry. If the parties are unable to mutually agree on a
third party arbitrator, then an arbitrator who is an expert in the industry will
be selected by the chief executive of the San Francisco office of the American
Arbitration Association. Once the arbitrator is selected, each party will make a
proposal to the arbitrator stating the Vendor List Price recommended by such
party and the party's reasons therefor. The arbitrator shall consider the
parties' recommendations, prevailing U.S. end user list prices for similar third
party products, Cadence's list prices for other similar Cadence products, the
amount by which list prices typically exceed actual prices charged to customers
and other relevant information before rendering a decision. The arbitration
shall be "baseball" style and the arbitrator shall render a final, binding
decision by selecting one of the parties' proposals for the Vendor List Price.
The arbitrator shall not have the authority to render any substantive decision
other than to select a Vendor List Price as proposed by one of the parties. The
Vendor List Price selected by the arbitrator shall be effective until the
parties mutually agree otherwise or, if sooner, by a subsequent determination of
a third party arbitrator in accordance with the provisions of this Section 2.7.
The costs of such arbitration shall be [*] and each party shall bear its own
expenses in connection with such arbitration. Any such arbitration shall be
completed with thirty (30) days following a request by either party for such
arbitration.
2.8 Initial Vendor List Prices.
PRODUCT PRICE: [*] TIME BASED LICENSE
o Fire & Ice QX
[*] $[*]
[*] $[*]
o [*] $[*]
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
* Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
35
EXHIBIT D
SOFTWARE DEPOSIT AGREEMENT
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
36
SOFTWARE DEPOSIT AGREEMENT
BRAMBLES NSD, INC.
This Agreement ("Escrow Agreement") is executed as of this _____ day of
__________, 19___ by and among _______________, a ______________ corporation
("Participant"), Cadence Design Systems, Inc., a Delaware corporation
("Cadence") and Brambles NSD, Inc., a Delaware corporation ("NSD"), as Escrow
Agent.
RECITALS
Participant and Cadence have entered into that certain Software OEM
License Agreement to which this Escrow Agreement is attached as Exhibit D
thereto (the "Agreement"); and
Continuous availability of Participant's software programs and its
maintenance thereof are critical to Cadence in the conduct of its business; and
Participant wishes to insure that maintenance for Participant's software
is available in the event Participant fails to fulfill its maintenance
obligations as set forth in the Agreement or in the event Participant does not
remain in business; and
NSD is in the business of providing third party software escrow
protection by storing, retaining, and allowing limited access to proprietary
computer software, related media and materials.
NOW, THEREFORE, in consideration of the promises of mutual covenants
contained herein, and for other good and valuable consideration, receipt of
which is hereby acknowledged, the parties agree as follows:
1. DEPOSIT OF SOURCE MATERIALS
(a) The term "Source Materials" as used in this Escrow Agreement
shall have the meaning set forth in the Agreement.
(b) Participant agrees to deposit with NSD a complete copy of
Source Materials within thirty (30) days after execution of this Escrow
Agreement.
2. REVISIONS AND MAINTENANCE
(a) Participant agrees to deposit with NSD copies of all
revisions of and additions to the Source Materials within thirty (30) days
after said revisions and additions are made available to its customers.
(b) NSD shall acknowledge receipt of all revisions of and
additions to the Source Materials by sending written acknowledgement thereof to
both Participant and Cadence.
(c) Upon receipt of a new revision, NSD agrees to return to
Participant all such Source Materials from previous revisions as specified by
Participant in writing to NSD.
3. STORAGE AND SECURITY
(a) NSD shall act as custodian of the Source Materials until the
escrow is terminated, pursuant to Section 10 of this Escrow Agreement. NSD
shall establish, under its control, a secure receptacle for the purpose of
storing the Source Materials.
(b) The Source Materials deposited with NSD by Participant
pursuant to this Escrow Agreement shall remain the exclusive property of the
Participant.
37
(c) Except as provided in this Escrow Agreement, NSD agrees that:
(1) it shall not divulge, disclose or otherwise make available
to any parties other than Participant, or make any use whatsoever of the Source
Materials;
(2) it shall not permit any person access to the Source
Materials, except as may be necessary for NSD's authorized representatives to
perform its functions under this Escrow Agreement;
(3) access to the Source Materials by Participant shall be
granted by NSD only to those persons duly authorized in writing by a competent
officer of Participant;
(4) access to the Source Materials shall not be granted without
compliance with all security and identification procedures instituted by NSD.
(d) NSD shall have no obligation or responsibility to verify or
determine that the Source Materials deposited with NSD by Participant does, in
fact, consist of those items which Participant is obligated to deliver under
any agreement, and NSD shall bear no responsibility whatsoever to determine the
existence, relevance, completeness, currency, or accuracy of the Source
Materials.
(e) NSD's sole responsibility shall be to accept, store and deliver
the Source Materials deposited with it by Participant, in accordance with the
terms and conditions of this Escrow Agreement.
(f) If any of the Source Materials held in escrow by NSD shall be
attached, garnished or levied upon pursuant to an order of court, or the
delivery thereof shall be stayed or enjoined by an order of court, or any other
order, judgment or decree shall be made or entered by any court affecting the
Source Materials or any part thereof, NSD is hereby expressly authorized at its
sole discretion to obey and comply with all orders, judgments or decrees so
entered or issued by any court, without the necessity of inquiring whether such
court had jurisdiction, and in case NSD obeys or complies with any such order,
judgment or decree, NSD shall not be liable to Cadence, Participant or any
third party by reason of such compliance, notwithstanding that such order,
judgment or decree may subsequently be reversed, modified or vacated.
4. EVENTS OF DEFAULT
The occurrence of any of the following shall constitute an
"Event of Default" for purposes of this Escrow Agreement.
(a) any Release Event as defined in Section 8.3 of the Agreement.
5. RELEASE OF DOCUMENTATION
(a) Upon the occurrence of any Event of Default (as defined in
Section 4), Cadence may notify NSD in writing as to such Event of Default (a
"Notice"), and shall simultaneously provide a copy of any such Notice to
Participant. Unless Participant shall have provided Contrary Instructions to
NSD within ten (10) business days after receipt of Cadence's Notice, the Source
Materials then in escrow shall be delivered to Cadence by NSD within the next
five (5) business days following the end of any such ten (10) day period. Such
delivery shall terminate all duties and obligations of NSD to Participant and
Cadence.
(b) "Contrary Instructions" for the purposes of this Escrow
Agreement means a written notice by Participant stating that the Event or
Events of Default specified in Cadence's Notice have not occurred, or have been
cured.
(c) Upon timely receipt of such Contrary Instructions, NSD shall not
release the Source Materials then in escrow, but shall continue to store the
Source Materials until otherwise directed by Cadence or
38
Participant jointly, or until resolution of the dispute pursuant to Section 6 of
this Escrow Agreement, or by a court of competent jurisdiction.
(d) NSD shall be entitled to receive payment of costs, fees and
expenses due it, prior to release of the Source Materials.
6. DISPUTE RESOLUTION
Participant and Cadence agree that if Contrary Instructions are
timely given by Participant pursuant to Section 5 hereof, then Participant and
Cadence shall submit their dispute regarding Cadence's Notice to arbitration by
a single arbitrator who is a member of the American Arbitration Association,
according to its rules and regulations then in effect, at its offices in San
Francisco,
California. The decision of the arbitrator shall be final and binding
upon the parties and enforceable in any court of competent jurisdiction, and a
copy of such decision shall be delivered immediately to Participant, Cadence and
NSD. The parties shall use their best effort to commence the arbitration
proceeding within ten (10) business days following delivery of the Contrary
Instructions. The sole question to be determined by the arbitrator shall be
whether or not there existed an Event of Default at the time Cadence delivered
the Notice thereof under Section 5. If the arbitrator finds that the Notice was
properly given by Cadence, NSD shall promptly deliver the Source Materials to
Cadence. All fees and charges by the American Arbitration Association and the
reasonable attorneys' fees and costs incurred by the prevailing party in the
arbitration shall be paid by the non-prevailing party in the arbitration.
7. BANKRUPTCY
Participant and Cadence acknowledge that this Escrow Agreement is an
"agreement supplementary to" the Agreement as provided in Section 365(n)(3) of
▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code (the "Bankruptcy Code"). Participant acknowledges
that if Participant as a debtor in possession or a trustee in Bankruptcy in a
case under the Bankruptcy Code rejects the Agreement or this Escrow Agreement,
Cadence may elect to retain its rights under the Agreement and this Escrow
Agreement as provided in Section 365(n)(3) of Title 11 of the Bankruptcy Code.
Participant or such bankruptcy trustee shall not interfere with the rights of
Cadence as provided in the Agreement and this Escrow Agreement, including the
right to obtain the Source Materials from NSD.
8. INDEMNIFICATION
Participant and Cadence each agrees to defend and indemnify NSD and
hold NSD harmless from and against any claim, action, loss, cost, liability or
expense (including reasonable counsel fees) arising out of or relating to this
Escrow Agreement (collectively, "Claims"), except to the extent such Claim is
based on NSD's gross negligence or willful misconduct.
9. GOOD FAITH RELIANCE
NSD shall act in good faith reliance upon any instruction, instrument,
or signature believed in good faith to be genuine and may assume that any person
purported to give any writing, notice, respect, advice or instruction in
connection or relating to this Escrow Agreement has been duly authorized to do
so.
10. TERMINATION
(a) This agreement shall terminate upon termination of the Agreement;
provided, however, that if Cadence has provided a Notice of an Event of Default
to NSD on or before the date of termination of the Agreement, this Agreement
will not terminate until such Notice of an Event of Default has been acted upon
and/or resolved to be properly or improperly given pursuant to Sections 5 and 6.
Upon such termination, unless the Agreement shall have been terminated as a
result of rejection of the Agreement in a bankruptcy case of Participant,
39
NSD shall return the Source Materials then in escrow to Participant after the
payment of all costs, fees and expenses due NSD.
(b) Cadence and Participant may terminate this Escrow Agreement by
mutual written agreement, giving sixty (60) days notice to NSD.
(c) NSD reserves the right to resign as escrow agent upon sixty
(60) days prior notice to Participant and Cadence. Upon resignation, NSD shall
return to Participant all of the Source Materials then in NSD's possession only
after having received payment of its fees and costs pursuant to Section 11 of
this Escrow Agreement.
(d) In the event that the sixty (60) day notice period in 10(c)
elapses without NSD having received payment from either Participant or from
Cadence of the remaining fees due, NSD shall then have the option, without
further notice to either party, to terminate the Escrow Agreement and to destroy
all escrowed Source Materials.
11. FEES
(a) In consideration of performing its function as escrow agent,
NSD shall be compensated as set forth on Exhibit A. The fees set forth on
Exhibit C will be billed periodically by NSD to Cadence.
(b) The fees set forth on Exhibit C are for NSD's ordinary
services as escrow agent. In the event NSD is required to perform any additional
or extraordinary services as a result of being escrow agent including
intervention in any litigation or proceeding, NSD shall receive reasonable
compensation for such services and be reimbursed for such costs incurred,
including reasonable attorneys' fees.
12. ENTIRE AGREEMENT
This Escrow Agreement, including Exhibits hereto, constitutes the
entire agreement among the parties regarding the subject matter hereof and
supersedes all previous agreements, either oral or written, between the parties.
13. NOTICE
All notices required by this Escrow Agreement shall be sufficiently
served by mailing the same by certified or registered mail, return receipt
requested, to the parties at their respective addresses, as follows:
(a) BRAMBLES NSD, INC.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
ATTN: Escrow Officer
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
(b) Participant:
SIMPLEX SOLUTIONS, INC.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTN: President
Phone: (▇▇▇) ▇▇▇-▇▇▇▇▇
40
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
(c) Cadence:
CADENCE DESIGN SYSTEMS, INC.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTN: General Counsel
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇
14. COUNTERPARTS
This Escrow Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, and all of which taken together
shall constitute one and the same instrument.
15. GOVERNING LAW
This Escrow Agreement shall be governed by and construed according to
the laws of the State of
California.
16. SEVERABILITY
In the event any of the provisions of this Escrow Agreement shall be
held by a court of competent jurisdiction to be contrary to any state or
federal law, the remaining provisions of this Escrow Agreement will remain in
full force and effect.
17. HEADINGS
The section headings in this Escrow Agreement do not form a part of
it, but are for convenience only and shall not limit or affect the meaning of
the provisions.
IN WITNESS WHEREOF, the parties have executed this Escrow Agreement
on the day and in the year first above written.
PARTICIPANT BRAMBLES NSD, INC.
By /s/ ▇▇▇ ▇▇▇▇▇▇▇▇ By
---------------------------- --------------------------------------
Print Name: ▇▇▇ ▇▇▇▇▇▇▇▇ Print Name:
------------------- -----------------------------
Title: President/COO Title:
------------------------ ----------------------------------
Date: 1/11/02 Date:
------------------------- ----------------------------------
41
CADENCE: Cadence Design Systems, Inc.
By /s/ ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------
Print Name: ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------
Title: SR. VP & GENERAL COUNSEL
------------------------
Date: 1/11/02
-------------------------
42
EXHIBIT A
FEE SCHEDULE
Escrow Agent: BRAMBLES NSD, INC.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Re: Escrow Agreement #______, dated ___________________________
1. Initial Acceptance Fee (One Time Only) $1,125.00
2. Custom Escrow Agreements Priced by Proposal
Amend Existing Agreement Priced by Proposal
3. Annual Storage Fee
Safe Deposit Box Storage $ 475.00
(Volume up to 10" X 10" X 24")
Larger Units Available
4. Account Administration/Maintenance
Clerical (One hour minimum per year) $ 30.00/Hr.
Officer Level (As required) $ 75.00/Hr.
Termination Fee (Minimum) $ 150.00
Shipping additional
Bi-Annual Account Status Report $ 50.00/ea.
Verification Services (Variable Depth) Ask for quote
5. Registration of Additional Cadences To Multiple
Cadence Escrow
First Cadence No Charge
Additional Cadences - Initial Registration $ 125.00 ea.
Annual Fee Per Cadence Thereafter $ 25.00 ea.
Cadence Termination $ 25.00 ea.
6. Bonded Courier Service - Pick-up/Delivery
Quote based on Location
7. Outside Costs
Cost Plus 10%, as Incurred
Prices subject to change without notice. Effective 7/1/98
43
EXHIBIT E
LICENSES FOR USE IN PROFESSIONAL SERVICES
REF: Software OEM Agreement
Dated:
================================================================================
THE FOLLOWING PROVISIONS OF THIS EXHIBIT E SHALL APPLY ONLY IF NEITHER CADENCE
NOR ANY OF ITS SUBSIDIARIES RECOGNIZES, AND NORMALLY WOULD NOT RECOGNIZE,
REVENUE FOR THE LICENSED WORKS OR MAINTENANCE SERVICES BY ANY WORLD WIDE
SERVICES ENTITY. ACCORDINGLY, THIS EXHIBIT E AND THE LICENSES HEREIN SHALL NOT
APPLY TO ANY SITUATION WHERE CADENCE OR ANY OF ITS SUBSIDIARIES RECOGNIZES
REVENUE FOR THE LICENSED WORKS OR MAINTENANCE SERVICES BY ANY WORLD WIDE
SERVICES ENTITY OR WOULD NORMALLY RECOGNIZE REVENUE FOR PROVIDING SIMILAR
PRODUCTS OF ITS OWN OR ASSOCIATED MAINTENANCE SERVICES.
1. DEFINITIONS: Unless defined in this Exhibit, capitalized terms shall have
the meanings provided therefor in the Software OEM License Agreement to which
this Exhibit is attached (the "OEM Agreement").
(a) "IP RIGHTS" means semiconductor topography rights, rights in maskworks
conferred by the U.S. Semiconductor Chip Protection Act of 1994 or any
modification or re-enactment thereof, patents, copyrights, trademarks
(including service marks), trade secrets, and design rights whether registered
or unregistered and including any application for registration of any of the
foregoing, and all rights or forms of protection of a similar nature or having
equivalent or similar effect to any of these, which may subsist anywhere in the
world.
(b) "WORLD WIDE SERVICES" means the World Wide Services groups within
Cadence and its Subsidiaries worldwide, which are engaged in the performance of
electronic design and consulting services for customers.
2. INTERNAL EVALUATION LICENSE: Vendor hereby grants to World Wide Services
a non-exclusive, non-transferable, royalty fee, right and license to use copies
of the Licensed Works internally worldwide, and only to the limited extent
necessary for World Wide Services' internal review, evaluation, testing,
verification, and training.
3. LICENSE TO CUSTOMERS: The parties intend that in connection with World
Wide Services providing electronic design and/or consulting services to a
customer involving the Licensed Work, Cadence must license the Licensed Work
directly to the End User customer pursuant to the distribution rights granted
to Cadence in the OEM Agreement before World Wide Services may use the license
rights reflected below in its professional services for such customer involving
the Licensed Work. If the End User customer does not purchase, or has not
purchased, a license to the Licensed Work which is the subject of the
professional services, then World Wide Services may not use the Licensed Work
in the performance of professional services for such customer, unless Cadence
itself purchases or has purchased a license to such software directly from
Vendor at a negotiated price. The licenses below only apply if Cadence's
professional services customer has purchased a license to the Licensed Work and
only apply to the specific copy of the Licensed Work purchased by such customer.
4. ACCESS LICENSE: If an End User licensee of the Licensed Work is also a
World Wide Services professional services customer, Vendor hereby grants to
World Wide Services a non-exclusive, non-transferable, worldwide, royalty-free,
limited license to use and practice the Licensed Work licensed to such customer
licensee, in the performance by World Wide Services of professional services
for such customer licensee at such customer's facilities and as a permitted
user under such customer's software license agreement for the Licensed Work.
Vendor agrees that such customer licensee may make the Licensed Work licensed
to customer available to World Wide Services for use in connection with World
Wide Services' performing professional services for such customer licensee
involving the Licensed Work.
5. TEMPORARY LICENSES FOR SPECIFIC SERVICES ENGAGEMENTS: If a customer of
World Wide Services is also a End User licensee of a Licensed Work, then World
Wide Services may use copies of the same Licensed Work licensed to such
customer licensee in Cadence's or its Subsidiary's own facilities in the
performance of a specific professional services engagement for such customer
involving such Licensed Work, provided that the total number of copies in use
concurrently by World Wide Services and such customer do not exceed the number
of copies
44
permitted under such customer's end user license agreement. This license shall
only apply where the customer has purchased per copy licenses for which Vendor
has been paid under the Agreement. With respect to such Licensed Work licensed
to such customer, Vendor hereby grants to the World Wide Services a
non-transferable, non-exclusive, royalty free, limited license, for the time
period set forth below, to use and practice the Licensed Work licensed to such
customer in the same form licensed to such customer, at the Cadence or its
Subsidiary's site(s), solely for the purpose of performing the specific
professional services engagement for such customer. Such license shall be
granted for a time period equal to the duration of the specific professional
services engagement for such customer.
6. OTHER LICENSE TERMS:
The following additional license terms shall apply to the licenses granted in
Sections 2, 4 and 5 of this Exhibit:
(a) Subject to Cadence's confidentiality obligations under the
Agreement, Vendor agrees that World Wide Services may use contractors to perform
the evaluation and/or the professional services involving a Licensed Work for a
licensee customer. Cadence agrees that the World Wide Services will not use any
Licensed Work in its professional services for a customer except as expressly
authorized in this Exhibit, and that World Wide Services will only grant access
to the Licensed Works licensed under this Exhibit to those of its employees
and/or contractors (1) performing the permitted evaluation (Section 2) or (2)
performing the specific professional services engagement for such licensee
customer (Sections 4 and 5). Cadence and its Subsidiaries shall impose
confidentiality obligations and use restrictions on their contractors so using
the Licensed Work as permitted hereunder.
(b) With respect to a Licensed Work licensed to World Wide Services
under Section 2 hereof, World Wide Services shall be entitled to receive from
Cadence, at no charge, all Maintenance Modifications and Enhancements to such
Licensed Work that are released by Vendor to Cadence during the applicable
evaluation period(s). With respect to a Licensed Work licensed to World Wide
Services under Section 5, World Wide Services shall be entitled to receive from
Cadence, at no charge, all Maintenance Modifications and Enhancements to such
Licensed Work that are released by Vendor to Cadence during the period World
Wide Services performs the specific professional services engagement for such
licensee customer, but only to the same extent such licensee customer would be
entitled to receive such Maintenance Modifications or Enhancements.
(c) Cadence and World Wide Services shall not disclose to any third
party any performance information relating to the Licensed Works.
(d) Except in the event of breach by Cadence, the provisions of this
Exhibit E shall survive termination of the OEM Agreement for whatever reason
until the earlier of six (6) months after termination or completion of all
relevant professional services engagements.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
45
EXHIBIT F
TRADEMARK SPECIFICATIONS
REF: Software OEM Agreement
Dated:
=======================================================
1. TRADEMARK SPECIFICATIONS.
The following are the trademark specifications for the Trademarks: [TBD
PROMPTLY AFTER THE EFFECTIVE DATE] of Vendor.
[TBD PROMPTLY AFTER THE EFFECTIVE DATE]
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
CADENCE CONFIDENTIAL
SOFTWARE OEM LICENSE AGREEMENT
46
EXHIBIT G
HOUSE ACCOUNTS FOR [*]
[*]
Each of such customers shall include all affiliates of such customer. For
purposes hereof, "affiliates" means entities that control, are controlled by or
are under common control with the respective customer. Ownership of at least
50% of the voting securities of an entity shall be deemed to constitute
control.
CADENCE CONFIDENTIAL
SOFTWARE OEM LICENSE AGREEMENT
* Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
47