1
EXHIBIT 10.18
LICENSE AND DISTRIBUTION AGREEMENT
This License and Distribution Agreement ("Agreement") is entered into
and is effective as of June 30, 1995 ("Effective Date") between Compaq Computer
Corporation, a Delaware corporation ("Compaq") and Visioneer Communications,
Inc., a California corporation ("Visioneer"). When used herein references to
"Compaq" and "Visioneer" shall include their respective Subsidiaries.
RECITALS
Visioneer has developed and is selling a desktop scanner and Windows
and Macintosh-based software used for scanning paper documents and converting
them into a form for use and distribution on personal computers ("PaperPort
Product"). Visioneer has developed and approached Compaq with a prototype of a
new version of the PaperPort Product in which the scanner is integrated into the
personal computer keyboard ("Keyboard Product"). In the interest of having
Compaq promote, endorse and create a market for the distribution of the Keyboard
Product, Compaq funded Visioneer's completion of a Compaq version of a prototype
for the Keyboard Product and is interested in working with Visioneer and
Compaq's third party keyboard manufacturer to complete development and arrange
for the manufacture of the Keyboard Product for introduction and distribution by
Compaq as a Compaq-branded product in early 1996. Compaq also desires
Visioneer's participation in supporting Compaq's customers and training Compaq's
personnel and distributors with respect to the Keyboard Product and the
PaperPort Product software and to obtain limited exclusive rights to distribute
the Keyboard Product, the PaperPort Product software and potential follow-on
products. Visioneer is willing to provide such assistance and grant such rights
to Compaq in exchange for the promotional advantages, royalty payments and other
terms and conditions set forth below.
Visioneer and Compaq agree as follows:
1.0 DEFINITIONS
1.1 "DELIVERABLES" means any part or all of the items to be provided by
Visioneer to Compaq as part of a Customization Project (as defined in Section
2.1 below).
1.2 "DOCUMENTATION" means user manuals related to the Products.
Documentation shall include any revisions, updates, Modifications or
enhancements to such Documentation.
1.3 "ERROR" shall mean a defect in the Products that prevents the
Products from functioning in accordance with the specifications therefor. Errors
shall be classified as follows:
(a) Severity "1" Error shall mean an Error in the Products
which causes a major feature to not work, and there is no workaround available.
2
(b) Severity "2" Error shall mean an Error in the Products
which causes a major feature to not work, and there is a workaround available,
or a minor feature is not working and there is no workaround available.
(c) Severity "3" Error shall mean an Error in the Products
which causes a minor feature to not work and there is a workaround available.
(d) Severity "4" Error shall mean an Error in the Products
which is cosmetic in nature.
1.4 "MODIFICATIONS" means all changes to the Products to correct any
Error therein and/or to incorporate minor enhancements other than changes
limited to "look and feel" alterations (as described in Section 2.2), but which
do not add to or significantly alter the Products' functionality.
1.5 "OBJECT CODE" shall mean computer programs assembled or compiled in
magnetic or electronic binary form on software media, which are readable and
usable by machines, but not generally readable by humans without reverse
assembly, reverse compiling, or reverse engineering.
1.6 "PRODUCTS" means the Keyboard Product (as more particularly
described in Exhibit 1 attached hereto) and the PaperPort Product software (as
more particularly described in Exhibit 2 attached hereto) including all
Modifications to the foregoing created or licensed by Visioneer during the Term.
Except as provided in Section 18 below, the PaperPort Product software shall be
provided in Object Code version only.
1.7 "RESIDUALS" shall mean information in non-tangible form that may be
retained by persons who have had rightful access to the information, including
ideas, concepts, know-how, or techniques contained therein.
1.8 "SOURCE CODE" shall mean code, other than Object Code, and related
source code level system documentation, comments and procedural code such as job
control language, which may be printed out or displayed in a form readable and
understandable by a computer programmer of ordinary skill.
1.9 "SUBSIDIARY" means any entity of which more than fifty percent
(50%) of the voting rights are owned or controlled, directly or indirectly, by a
party hereto, provided, however, that such entity shall be deemed to be a
Subsidiary only for so long as such ownership or control exists.
1.10 "TERM" means the time period specified in Section 16.0 of this
Agreement.
1.11 "UPGRADES" means changes to the Products that significantly add
to, enhance or improve their functionality and are intended to be a full
replacement for the previous releases of the Products.
2.0 CUSTOMIZATION PROJECT(S)
2.1 Compaq and Visioneer shall work together and with Compaq's keyboard
manufacturer to develop the Keyboard Product in accordance with Section 4.0
below and the work plan, milestones, specifications for Deliverables and
payments by Compaq to Visioneer set forth in Exhibit 3 attached hereto ("Initial
Customization Project"). Compaq will confer with
-2-
3
Visioneer on its selection of such keyboard manufacturer or any replacement or
supplemental keyboard manufacturer, and Visioneer's concurrence with the
selection will not be unreasonably withheld. Both parties shall use reasonable
diligence in meeting the timetable and other requirements of the Initial
Customization Project. The Initial Customization Project and any future
customization projects to which Compaq and Visioneer may agree in writing for
which Compaq pays Visioneer for non-recurring engineering services are referred
to herein as "Customization Projects".
2.2 Visioneer shall own any U.S. and foreign patent rights to any
inventions or improvements to the Products made pursuant to any Customization
Projects. Visioneer hereby assigns to Compaq ownership of the intellectual and
tangible property, other than U.S. or foreign patent rights which shall continue
to be owned by Visioneer, associated with the appearance of any version of the
Keyboard Product (including concept models and drawings) created pursuant to any
Customization Project under this Agreement. In addition, Visioneer hereby grants
Compaq a fully paid up, nonexclusive, nontransferable, worldwide license to use,
make, have made and sell keyboard products under any such patents. The intent of
the parties is that (1) the appearance design (or "look and feel") of the Compaq
version of the Keyboard Product be (i) consistent with the appearance of
Compaq's existing products and (ii) unique in appearance relative to the
Visioneer or any third party version of Keyboard Product; and (2) the Compaq
version of the Keyboard Product will be integrated into a keyboard (or
keyboards) of Compaq's choosing. However, Visioneer shall not be restricted from
developing or selling other versions of the Keyboard Product which have the same
or similar keys and other components in the same general configurations and
positions on the keyboard, as long as the general appearance of such keyboard
versions is sufficiently different so as not to lead an average computer user to
believe that such versions are in fact Compaq products.
3.0 PAPERPORT PRODUCT SOFTWARE AND DOCUMENTATION LICENSE
3.1 Visioneer hereby grants to Compaq a non-exclusive,
non-transferable, worldwide, royalty free license to internally use, display,
perform and internally distribute the Products and Documentation within Compaq
for marketing, sales, testing, training and support purposes only. After an
initial five hundred copies which may be distributed among its employees for
general business purposes, any general use of the Products by Compaq's employees
shall be subject to the royalty to Visioneer. Visioneer further grants to Compaq
a non-exclusive, non-transferable, worldwide, royalty free license to publicly
perform and publicly display the Products and Documentation at trade shows,
exhibitions, and to prospective resellers and customers.
3.2 Visioneer hereby grants to Compaq a non-exclusive,
non-transferable, worldwide, royalty bearing license to use, have used, copy,
have copied and externally distribute, either directly or indirectly through
resellers, Object Code of the PaperPort Product software included as part of the
Products and Documentation for use by end user customers of Compaq's personal
computer systems who purchase the Keyboard Product. Compaq shall include such
software on each of its personal computer systems which it sells with the
Keyboard Product or bundled with each Keyboard Product which it sells separately
and shall distribute and license such software pursuant to Compaq's then current
standard form of shrinkwrap license agreement, the present form of which is
attached hereto as Exhibit 4. Royalty payments will be made in accordance with
Section 6.0 and Exhibit 5.
-3-
4
3.3 If Visioneer licenses another personal computer systems
manufacturer to distribute the PaperPort Product software in conjunction with a
non-Visioneer keyboard/scanner product, the license granted in Sections 3.1 and
3.2 shall be deemed broadened to allow Compaq to distribute the PaperPort
Product software with a non-Visioneer keyboard/scanner product. A "non-Visioneer
keyboard/scanner product" means an integrated keyboard/scanner which neither was
designed or manufactured by Visioneer or its licensee nor contains any
Visioneer-developed components (including the scanner subassembly). This change
in Visioneer's distribution methodology will also be considered a "new release
of the Keyboard Product" for purposes of Section 7.2.
3.4 The PaperPort Product software contains a "Free Ware" component
consisting of a viewer portion of the software which is required to enable a
personal computer system that receives a document from a PaperPort or Keyboard
Product to utilize the document received. Compaq may distribute this Free Ware
component at its own expense in Object Code form, directly or indirectly, on a
royalty free, stand alone basis via an electronic bulletin board or otherwise as
Compaq may deem appropriate from time to time without an end user license
agreement of any kind pertaining to the Free Ware component.
3.5 Compaq's distribution of software included in the Products and
related Documentation may be by preinstallation on CD-ROM, on hard disk drives,
and/or other media provided with the Compaq products, in separate packaging with
other documentation and/or media, or by electronic downloading, at Compaq's sole
option and expense. A CD-ROM containing such software may also be included in
the package for the Compaq product for back up purposes (the backup CD-ROM may
include various translations or configurations of the software). Modifications
and replacement copies of each software will be distributed separately, either
directly or by reseller to existing end user customers and may be copied by
resellers from a backup CD-ROM restoration utility to be used for maintenance
purposes only. At the time of each new software release Visioneer will supply
Compaq with a master diskette suitable for duplication of such software.
3.6 The license granted herein by Visioneer to Compaq shall
automatically extend to include (a) Compaq's Subsidiaries and (b) Compaq's
contractors and consultants to the extent necessary for Compaq to exercise the
licenses granted herein. Nothing herein shall give such contractors or
consultants any right to sell the Products to any customer other than Compaq.
3.7 Upgrades of the PaperPort Product software that Visioneer plans to
release during the Term of the Agreement will be offered by Visioneer to Compaq
for sublicensing to its customers in accordance with Section 7.0. Compaq will
have a non-exclusive, royalty bearing license to distribute Upgrades of the
PaperPort Product software to Compaq customers. Compaq shall pay Visioneer a
royalty on such software Upgrades as described in Section 6.2 below. Except as
set forth in Section 7.0 of this Agreement, Visioneer will not be restricted
from distributing the PaperPort Product software included in the Products on a
direct or OEM basis or as a stand-alone product.
-4-
5
4.0 MANUFACTURE AND SUPPLY OF KEYBOARD PRODUCT
4.1 Visioneer will provide reasonable technical and design assistance
to Compaq and to Compaq's keyboard manufacturer in the design and manufacture of
the Keyboard Product. Promptly after execution of this Agreement and subject to
execution by such keyboard manufacturer of an appropriate nondisclosure
agreement, Visioneer will provide such keyboard manufacturer with the
manufacturing and design information related to the PaperPort Product desktop
scanner listed in Exhibit 7 attached hereto, including a list of all present
suppliers of components used by Visioneer to build such desktop scanner
("Manufacturing Information"). Visioneer shall promptly update such
Manufacturing Information upon its release of new versions of the PaperPort
Product. Manufacturing Information shall be considered Confidential Information
of Visioneer for purposes of Section 12.0 below. Unless otherwise agreed by
Compaq, Visioneer shall provide such technical and design assistance and
Manufacturing Information at Visioneer's expense.
4.2 Compaq will place purchase orders directly with its keyboard
manufacturer for its requirements of the Keyboard Product. The keyboard
manufacturer will place purchase orders with component suppliers of Visioneer
(as specified in Exhibit 7).
4.3 Visioneer shall have the right if it desires to do so to work with
Compaq's keyboard manufacturer to develop and purchase its own version of the
Keyboard Product from such manufacturer, subject to the requirements and
restrictions set forth in Sections 2.0 and 7.0
4.4 Compaq and Compaq's keyboard manufacturer shall not make any
changes to the design of the Keyboard Product, other than those limited to
appearance design or the "look and feel" of the Product as described in Section
2.2, without Visioneer's prior written consent, which will not be unreasonably
withheld.
4.5 Compaq will furnish Visioneer with forecasts of its expected volume
of sales of the Products for the following twelve months as soon as possible
after the beginning of each calendar quarter during the Term. Such forecasts are
not commitments by Compaq and are to be used for planning purpose only.
5.0 KEYBOARD PRODUCT MANUFACTURING LICENSE
5.1 Visioneer hereby grants to Compaq a nonexclusive, non-transferable,
worldwide, royalty bearing license under Visioneer's know how, patents,
copyrights and trade secrets to use, have used, manufacture, have manufactured,
sell, lease, or otherwise transfer, either directly or indirectly through
resellers, the Keyboard Product.
5.2 The license granted herein by Visioneer to Compaq shall
automatically extend to include (a) Compaq's Subsidiaries and (b) Compaq's
contractors and consultants to the extent necessary for Compaq to exercise the
licenses granted herein. Nothing herein shall give such contractors or
consultants any right to sell the Products to any customer other than Compaq.
-5-
6
Exhibit 10.18
6.0 PAYMENTS
6.1 Royalty schedules for the Products are set forth in Exhibit 5
attached hereto. Royalties shall be payable for any calendar quarter during the
Term within XXXXXXXXXXXX XXXXXXXXX XXXXXXXXX days after the end of such
quarter. Compaq shall supply Visioneer with a report showing the number and
category (stand alone or integrated) of units of the Products shipped during
such quarter within XXXXXXXXXXXX XXXXXXXXX XXXXXXXXX days after the end of
such quarter. For each quarter in calendar year 1996, Compaq shall also supply
Visioneer with a report showing in reasonable detail the estimated number and
category (stand alone or integrated) of units of the Products shipped during
such quarter within XXXXXXXXXXXX XXXXXXXXX XXXXXXXXX days after the end of
such quarter (if the fifteenth day falls on a weekend or holiday, reporting
will be done on the next following business day). For any quarter after
calendar year 1996, Visioneer may submit to Compaq for confirmation on or
about the XXXXXXXXXXXX XXXXXXXXX XXXXXXXXX day after the end of such quarter
Visioneer's estimates of Royalties and number and category of units of Products
shipped during such quarter. Royalties shall be considered earned upon shipment
of the Products by Compaq and shall be paid by Compaq in U.S. Dollars. Compaq
shall receive credit for all royalties paid with respect to any Products which
are returned.
6.2 In consideration of Compaq's integration, market support, launch
efforts, and product support for Visioneer products and technology, charges to
Compaq for the Products will be the lesser of XXX of the lowest price charged to
any other party under comparable circumstances who is not responsible for
support, or XXX of the lowest price charged to any other party under comparable
circumstances who is responsible for providing support.
6.3 Royalties for Upgrades to the PaperPort Product software shall be
payable as set forth in Section 6.1 above and shall be the lower of (i) XXX of
Visioneer's lowest end user price for such Upgrade then in effect under
comparable circumstances, and (ii) XXX of Visioneer's lowest price to
distributors for such Upgrade then in effect under comparable circumstances.
Compaq shall copy and distribute such Upgrades at its own expense (including
diskettes).
6.4 Compaq shall maintain complete and accurate accounting records, in
accordance with sound accounting practices, to support and document all royalty
payments. Such records shall be retained for a period of at least three years
after the accrual of such payments. Visioneer may retain, at its expense, an
independent accounting organization to audit Compaq's records and such
independent organization shall have access to such records, upon reasonable
notice, solely for the purpose of such audit during normal business hours, for
so long as such records are required to be maintained.
7.0 LIMITED EXCLUSIVITY
7.1 While Compaq meets the necessary sales volumes forecast set forth
in Exhibit 6 attached hereto, Visioneer will provide limited exclusivity to
Compaq for distribution of the Products as provided in this Section 7.1. The
limited exclusivity period shall begin on the Effective Date and end on XXXXXXX
(the "Exclusive Period"), unless the scheduled introduction date for the
Keyboard Product which is set forth in Exhibit 3 is delayed due to Visioneer's
failure to perform its obligations under this Agreement, in which case the
ending date of the Exclusive Period shall be extended on a day-to-day basis to
reflect such delay. During the Exclusive Period and except as provided below,
Visioneer shall not directly or indirectly (to the
-6-
XXX = Confidential Treatment Requested
7
extent that indirect distributions may be within its control), permit any
personal computer manufacturer (other than Compaq) to sell or distribute for
purposes of resale the PaperPort Product software which is bundled with a
version of the Keyboard Product developed or licensed by Visioneer, either as
integrated with a personal computer or as a stand alone bundled keyboard/scanner
and PaperPort Product software product. Nothing herein shall prevent Visioneer
during or after the Exclusivity Period from (a) selling its own version of the
Keyboard Product under its own name through its sales force or through its
distributors or OEM customers (other than directly or indirectly to other
personal computer manufacturers as described above), or (b) selling its
PaperPort Product (non-keyboard versions) under its own or other names through
its sales force or through its distributors or OEM customers (including personal
computer system manufacturers).
7.2 While Compaq meets the necessary sales volume forecast set forth in
Exhibit 6, Compaq will have a XXX day right of first refusal on the distribution
of any new release of the Keyboard Product. Visioneer will provide Compaq with
at least XXX days prior written notice of any proposed new release of the
Keyboard Product by Visioneer or any OEM customer of Visioneer. A "new release"
shall not include a version of the Keyboard Product which is different from the
previous version only by reason of minor product enhancements not adding to or
significantly altering the scanning functionality of the Keyboard Product. (Any
such new version which does not qualify as a "new release" will continue to be
distributed under the terms applicable to the previous version.) In such notice
Visioneer shall propose terms on which Visioneer is willing to permit Compaq to
distribute such new release of the Keyboard Product (which shall include an
exclusivity period similar to Section 7.1 above and favored pricing terms
similar to Sections 6.2 and 6.3 above). If Compaq and Visioneer have not come to
agreement on such terms within such XXX day period, Visioneer shall not be
restricted from entering into agreements with other personal computer systems
manufacturers to distribute and sell such products, provided that such
agreements are on terms and conditions no more favorable in the aggregate than
those offered to Compaq.
7.3 In the event that Compaq plans to sell an integrated
keyboard/scanner product primarily designed and marketed for use in conjunction
with desktop personal computers and using a non-Visioneer scanner subassembly or
software during any Exclusivity Period, Compaq agrees to notify Visioneer six
months prior to the initial shipment of the non-Visioneer product or promptly
upon the execution of an agreement to such effect with a third party, whichever
is earlier. Upon such notice the limited exclusivity provisions in Sections 7.1
and 7.2 above and the license provisions in Section 3.3 above shall immediately
terminate. Compaq shall not release any such non-Visioneer scanner product until
at least 180 days after Compaq's initial commercial shipment of the Keyboard
Product.
8.0 PRODUCT SUPPORT BY VISIONEER AND COMPAQ
8.1 During the Term of this Agreement, Compaq shall, at its own
expense, provide First Level Support and Second Level Support to its customers
for the Products. Visioneer agrees at its expense to provide assistance to
Compaq in providing Second Level Support, as necessary. Visioneer shall at its
expense provide Third Level Support to Compaq.
8.2 The Support Levels shall be as follows:
-7-
XXX = Confidential Treatment Requested
8
(i) First Level Support: Incoming calls involving setup,
installation and basic Product functionality and/or calls that can be
immediately answered and require no callback to the customer. No assistance from
the other party is required.
(ii) Second Level Support: Incoming calls that involve
detailed Product knowledge, problem isolation, or investigation by Customer
Service Technicians and require a call-back to the customer. These calls are
classified as "cases" and must be tracked until resolved by the technician.
Assistance from the other party may be required.
(iii) Third Level Support: Calls that have been classified as
"cases" and require engineering assistance and resolution from the other party.
Resolution may require conference calls between Customer, Compaq and Visioneer.
8.3 In recognition of Compaq's ongoing commitment to quality, service
and support, Visioneer agrees to comply with Compaq's customer support standards
and procedures as described in this Section. If Visioneer becomes aware of any
Errors in the PaperPort Product software included as part of the Products, or is
notified by Compaq of any such Errors, Visioneer shall promptly take appropriate
measures to correct such Errors and provide such corrections to Compaq in
accordance with the following schedule.
(i) Severity "1" Error: Visioneer will make every reasonable
effort to respond to Compaq within three working days of receipt of
notification, and shall come to closure within an additional five working days.
As used herein, closure shall mean a fix has been delivered to Compaq or a plan
to fix the Error has been delivered and is reasonably acceptable to Compaq. If
requested by Visioneer, the Vice President of Engineering of Visioneer and
Compaq's Senior Software Engineering Executive for the Products will meet within
such additional five day period to agree on the method for fixing such Error.
(ii) Severity "2" Error: Visioneer will respond to Compaq
within three working days of receipt of notification, and shall make every
reasonable effort to come to closure (as defined above) within an additional ten
working days.
(iii) Severity "3" Error: Visioneer will use its reasonable
efforts to achieve closure in the next scheduled release of the affected
program.
(iv) Severity "4" Error: Visioneer will use its reasonable
efforts to achieve closure in the next scheduled release of the affected
program.
8.4 Visioneer agrees to supply a single point of contact who shall be
available to Compaq in matters relating to the Product. Visioneer agrees that
such contact will use its reasonable efforts to work with Compaq on any
Modifications to the Product necessary to correct problems related to support
Compaq hardware and features. Additionally, Visioneer shall use its reasonable
efforts to cooperate with Compaq on an ongoing basis to test and modify the
Product to the extent necessary to facilitate the automation of Compaq's
software preloading and customer set-up/ease of use processes. The initial point
of contact is listed in Exhibit 3.
-8-
9
9.0 TRAINING
9.1 Visioneer shall, at Visioneer's expense, provide reasonable
training to Compaq personnel with respect to the Products to enable them to
train Compaq personnel, resellers, and customers to set-up, install, configure
and operate the Products and provide such other training and training materials
in electronic form to enable Compaq to train Compaq's customers, resellers, and
support partners and to otherwise exercise its rights under this Agreement.
Visioneer will provide up to four days of training which shall consist of two
days of technical training and two days of sales training for Products at no
cost to Compaq. Each such training session will consist of one Visioneer trainer
in one class teaching no more than 25 Compaq senior technical support or sales
people, as the case may be. These senior representatives will be responsible for
training and providing training materials to all additional technical support
personnel, sales representatives, customers, support organizations and/or
resellers. All such training shall be provided during normal business hours in
Houston, Texas, and Visioneer agrees to use reasonable efforts to complete such
training thirty days prior to the commencement of Compaq's marketing effort for
the Products. Additional training for Modifications and/or Upgrades made by
Visioneer to the Products during the Term of this Agreement shall also be
provided at Visioneer's expense and within a mutually agreed upon time period.
Visioneer hereby grants Compaq, and its distributors the unrestricted and
royalty free right to use and modify all training materials provided by
Visioneer to Compaq for sale and/or use of the Products.
10.0 MARKETING PLANS AND ASSISTANCE
10.1 The parties shall use reasonable efforts to design, coordinate and
implement mutually beneficial marketing strategies and programs, as appropriate,
including but not limited to, public relations, advertising, product packaging,
trade shows, and seminars for the Products. The parties will share mutually
beneficial marketing information as they deem appropriate from time to time.
10.2 Unless otherwise agreed, the parties will work together to develop
a communications strategy to publicly announce the launch of the Products. All
press releases regarding the launch of the Products which reference the other
party shall be mutually agreed upon.
10.3 Notwithstanding anything to the contrary, neither party shall have
the right or ability to set the other's prices for Products. Each party shall
retain complete discretion to set its own prices for its Products.
10.4 As it deems appropriate, Compaq may provide assistance at
Visioneer's request in contacting mutually agreed independent software
developers prior to Compaq's introduction of the Products to persuade them to
develop software links between their software products and the Products.
10.5 Compaq will solicit end user product registration information from
all customers of the Products in the normal course of its business; all such
information is proprietary to Compaq. Where appropriate, Compaq and Visioneer
may engage in specialized target marketing of Products to this, or a related,
customer base. Compaq may share customer information with
-9-
10
Visioneer as it deems appropriate to exploit market opportunities. The parties
may cooperate on various promotional or marketing opportunities as proposed by
either one from time to time that may involve the other's customers.
11.0 INTELLECTUAL PROPERTY
11.1 Visioneer shall retain full ownership (including all copyrights,
patent and trade secret rights) to the Products, subject to Compaq's licenses in
Sections 3.0 and 5.0 and to Section 2.2 above. Except as otherwise expressly
provided herein, no right, title or interest in or to the intellectual property
rights in any Product or any portion thereof is transferred to either party
under this Agreement. Except as otherwise explicitly provided, nothing in this
Agreement shall grant either party any right, title or interest in the trade
names, trademarks, service marks, trade dress, words, symbols, or other marks
used, adopted or owned by the other party or in any design patents, design
registrations, or the like of the other party (or of any third party from whom
such party has acquired license rights) from time to time, either alone or in
association with other words or names.
11.2 Visioneer hereby grants to Compaq a non-exclusive,
non-transferable, worldwide, royalty free right to use Visioneer's marks in
connection with marketing and distributing the Products. The provisions set
forth in Exhibit 8 shall apply to Compaq's use of the marks. Compaq will use
commercially reasonable efforts to avoid any action that materially diminishes
the value of such marks.
11.3 All PaperPort Product software distributed by Compaq shall
identify Visioneer as the creator of the software on the initial screens. Compaq
shall not remove from, cover over or prevent from being displayed the notices of
Visioneer's name, copyright, trade secrets and/or proprietary rights notices
printed on or included in the Products purchased or licensed hereunder
(including screen notices), provided such notices are consistent with industry
practice. Compaq will use reasonable efforts to include such restricted rights
legends, proprietary notices, copyright or mask work notices, patent markings,
and the like as Visioneer requests.
11.4 The terms of this Agreement and any related Customization Project
shall not be construed to limit either party's right to independently develop or
acquire products, as long as such development or acquisition is not in violation
of the obligations of this Agreement. Further, either party shall be free to use
for any purpose (including but not limited to, use in the development,
manufacture, marketing, and maintenance of its own products and services) the
Residuals resulting from work done under this Agreement. Neither party shall
have any obligation to limit or restrict the assignment of any person, who has
had access to the information, or to pay royalties for anything resulting from
the use of Residuals. However, the foregoing shall not be deemed to grant either
party a license under the other party's copyrights or patents.
12.0 CONFIDENTIALITY
12.1 The parties have entered into various confidentiality and
nondisclosure agreements ("NDA(s)"). Without limiting the enforceability of any
of these NDAs, the parties agree that all information received from the other
and designated in writing as "confidential" or "proprietary" ("Confidential
Information") shall be subject to the following minimum protections, in addition
to
-10-
11
those contained in any applicable NDA. Each party agrees that it will treat the
other party's Confidential Information with at least the same degree of care as
it would its own proprietary informa tion. In addition, each party hereto
acknowledges the other party's representation that the other's Confidential
Information constitutes valuable proprietary and confidential information, and
agrees to (i) retain such Confidential Information in confidence for a period of
three years from its disclosure, (ii) restrict the use of and access of such
Confidential Information to its employees and subcontractors to whom disclosure
is necessary in connection with the performance required by this Agreement,
(iii) appropriately bind each employee or subcontractor to whom any such
disclosure is made to hold such Confidential Information in confidence, and (iv)
not sell, lease, transfer or otherwise disclose such Confidential Information to
any third party except as specifically permitted by this Agreement or the
relevant NDA.
12.2 Neither party shall disclose the terms and conditions of this
Agreement without the prior written approval of the other party, except as
provided below or as may be required by law or regulation in the opinion of its
counsel. Where written approval is obtained, disclosure shall be limited to the
subject matter approved. Approval to disclose any party of this Agreement shall
not constitute approval to disclose any other part of this Agreement. Subject to
an appropriate non-disclosure agreement, either party may disclose the substance
of the non-financial terms of this Agreement to actual and potential business
partners and investors as reasonably necessary, provided that Visioneer shall
not disclose the financial terms of this Agreement to any other personal
computer systems manufacturer without Compaq's prior written consent.
Notwithstanding the foregoing, either party may disclose the terms of this
Agreement to its legal and financial advisors and Board of Directors.
13.0 LIMITED WARRANTIES AND DISCLAIMERS
13.1 Visioneer represents and warrants that (1) it has the right and
authority to enter into this Agreement and to perform its obligations hereunder,
(2) it has the right to grant the intellectual property rights granted to Compaq
in this Agreement, and (3) the PaperPort Product software conforms to its
specification.
13.3 THE EXPRESS WARRANTIES SET FORTH IN THIS SECTION ARE IN LIEU OF
ANY OTHER WARRANTIES. VISIONEER HEREBY DISCLAIMS AND NEGATES ANY AND ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
14.0 INDEMNITIES
14.1 Subject to Section 15.1 below, Visioneer, shall defend, indemnify,
and hold Compaq harmless from and against any and all claims, actions, costs,
expenses, damages, judgments, or settlement, including reasonable attorney's
fees and expenses, resulting from any third party claim against Compaq alleging
that the Products, Deliverables, Documentation or Manufacturing Information
furnished under this Agreement infringe any patent, copyright, trade secret,
trademark or any other intellectual property right of any third party, provided
that Visioneer is promptly notified in writing of such claim and permitted to
defend and settle such claim and provided further that such claim does not
relate to any modification to the Products
-11-
12
made by Compaq or its keyboard manufacturer which were made without Visioneer's
consent as required in Section 4.4 of this Agreement. If a final injunction
issues against Compaq's use of any of the foregoing products or licenses,
Visioneer shall, at its expense, use commercially reasonable efforts to obtain
the right to continue using such products or licenses or modify the same, as the
case may be, to be non-infringing.
15.0 LIMITATIONS OF LIABILITY
15.1 IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY LOST
PROFITS, LOST BUSINESS, LOST REPUTATION, OR ANY OTHER INCIDENTAL, CONSEQUENTIAL,
OR SPECIAL DAMAGES FOR ANY REASON WHATSOEVER, WHETHER RESULTING FROM BREACH OF
WARRANTY, BREACH OR REPUDIATION OF CONTRACT, NEGLIGENCE, STRICT LIABILITY IN
TORT, OTHER TORT LIABILITY, STATUTORY LIABILITY, OR THE LIKE. THIS LIMITATION
SHALL NOT APPLY TO COMPAQ'S EXPENSES ARISING FROM THIRD PARTY CLAIMS IDENTIFIED
UNDER SECTION 14.0, INCLUDING DAMAGES, FEES AND COST AWARDED TO SUCH THIRD
PARTIES, SETTLEMENTS AND COMPAQ'S OTHER COSTS OR EXPENSES AS IDENTIFIED IN
SECTION 14.0. EXCEPT FOR VISIONEER'S LIABILITY UNDER SECTION 14.0, VISIONEER'S
TOTAL LIABILITY TO COMPAQ UNDER THIS AGREEMENT SHALL NOT EXCEED AMOUNTS PAID BY
COMPAQ TO VISIONEER.
16.0 ERM AND TERMINATION
16.1 Unless earlier terminated in accordance with the terms of Sections
16.2 or 16.3 of this Agreement, the term of this Agreement shall begin on the
Effective Date and shall remain in force and effect for a period of XXXXX years
from and after the Effective Date and, unless notice of nonrenewal is timely
given in accordance with Section 16.2, shall thereafter automatically be
extended and renewed for additional one year periods on a year-to-year basis.
16.2 If either party decides not to renew this Agreement, then it shall
send a written notice of its decision not to renew to the other party at least
sixty days before the end of the then current effective period (whether at the
end of the initial XXXXX year period or a subsequent one year period). In that
event, then this Agreement shall, subject to the provisions of Section 17.0
below, automatically expire at the end of the then current term. Such a notice
of nonrenewal may be sent with or without cause.
16.3 Subject to the provisions of Section 17.0 below, either party may
terminate this Agreement for cause only as follows: Upon a material default by
the other party, the non-defaulting party may send a detailed, written notice
describing the default and the steps required for cure. If the default
nonetheless remains uncured for thirty days after the defaulting party's receipt
of such notice, then the non-defaulting party may terminate this Agreement by
sending a written notice of termination, with such termination to be effective
immediately upon its receipt by the defaulting party.
16.4 This Section 16.0 states the exclusive bases for termination of
this Agreement.
-12-
XXX = Confidential Treatment Requested
13
17.0 EFFECTS OF TERMINATION
17.1 Sections 2.2, 6.4, 11.0, 12.0, 13.0, 14.0, 15.0, 16.0, 17.0 and
19.0 shall survive any termination or expiration of this Agreement. In addition,
Section 8.0 shall survive for a period of three years following Compaq's
withdrawal of the Keyboard Product from marketing.
18.0 ESCROW AGREEMENT
18.1 Visioneer will, within sixty (60) days after the Effective Date,
place Source Code, Object Code and Application Program Interfaces ("APIs"),
along with currently available documentation for each of the foregoing, for all
of the Products in escrow with Data Securities International ("Escrow Agent")
under the terms of the escrow agreement attached hereto as Exhibit 9. The
contents of the escrow account shall be updated concurrently with each new
Upgrade or Modification version of the Products.
18.2 Compaq may gain access to the APIs, Source Code and all other
documentation for the Products held by the Escrow Agent under any of the
following circumstance: (a) Visioneer is unable to reach closure on a Severity 1
or 2 Level Error, as defined in Section 8.3, within five business days of the
time allotted in that Section; or (b) Visioneer materially breaches this
Agreement and has not cured such breach within the time period described in
Section 16.3, or (c) Visioneer ceases operations. If the circumstance giving
rise to Compaq's request for access to the Source Code and related information
no longer exists (e.g., a mutually satisfactory plan for correcting the Error
has been reached) prior to Compaq's obtaining access to the Source Code, Compaq
shall withdraw its request by written notice to the Escrow Agent.
18.3 Compaq shall only use the escrowed materials for the purpose of
fixing errors and performing ongoing customer support concerning the PaperPort
Product software. If the condition giving rise to Compaq's access to the Source
Code has been corrected, Compaq shall return the Source Code and related
materials to escrow.
19.0 MISCELLANEOUS
19.1 Except for such sublicenses or transfers as may be allowed by this
Agreement, this Agreement is personal to the parties and neither party may sell,
transfer or assign this Agreement, in whole or in part, or any of that party's
rights or obligations hereunder, except (i) with the prior written consent of
the other party, which consent shall not be unreasonably withheld, or (ii)
pursuant to the acquisition of a party by a third party by way of merger, sale
of assets or otherwise where the third party agrees in writing to be bound by
this Agreement.
19.2 Neither party shall be liable for any delay in or failure of
performance under this Agreement resulting from events beyond its reasonable
control, so long as the effect of such event continues, including but not
limited to the following: hurricanes, tornadoes, earthquakes, floods, fires,
explosions, epidemics, power failures, communication system failures, strikes,
riots, wars or civil insurrections, acts of God, governmental regulations or
laws imposed after the Effective Date, and so forth; provided, however, that a
party subject to any such force majeure shall promptly give the other written
notice thereof and shall use reasonable efforts to remove or rectify any such
force majeure.
-13-
14
19.3 No amendment, modification, addition, or deletion to this
Agreement shall be effective unless it is in writing and signed by both parties.
19.4 No delay of either party in enforcing any right or remedy accorded
to it or which it may be or become entitled to have or exercise hereunder, nor
any number of recoveries thereon, shall affect, diminish, suspend, waive or
exhaust any such rights or remedies or any other similar or dissimilar rights or
remedies which might be available otherwise to it.
19.5 No waiver by either party of any default or breach of any
provision of this Agreement to be kept or performed by the other shall be
construed to be a waiver of any subsequent or succeeding default or breach of
the same or of any other provision hereof.
19.6 All notices and any other communications hereunder shall be
considered as having been given or made, and shall be effective, upon the
earlier of actual receipt thereof or five days after a party's depositing the
same with the United States Postal Service, with adequate first class postage
affixed and addressed to the other party as follows:
To Compaq: Compaq Computer Corporation
20555 SH 249
Houston, Texas 77070
MS 110701
Attention: Legal Department
To Visioneer: Visioneer Communications, Inc.
2860 West Bayshore Road
Palo Alto, CA 94303
Attention: President
or to such other address or addresses as such party may designate in writing
from time to time; provided, that notice of change of address shall never be
effective until actually received. Copies of all notices shall be sent by fax to
the other party at the same time they are mailed.
19.7 With respect to the other party, each party shall be considered an
"independent contractor" and all persons employed by each party in its
operations contemplated under this Agreement are not, and shall never be
considered for any purpose to be, agents or employees of the other party.
Neither party nor any of their respective employees shall have any authority
hereunder to make or enter into any agreement on behalf of the other party.
19.8 The parties shall comply with all applicable federal, state, and
local laws, including but not limited to any and all export regulations.
19.9 This Agreement and the parties' relationship shall be governed by
California law. The prevailing party in any litigation shall be entitled to
recover its attorneys' fees and costs in addition to any other relief it may be
awarded.
19.10 There are no third party beneficiaries of this Agreement. No
person not a party to this Agreement shall have or acquire any rights by reason
of this Agreement, nor shall either party have any liabilities or obligations to
any such third party.
-14-
15
19.11 This Agreement and the NDAs referred to herein constitute the
sole and entire Agreement between the parties regarding the subject matter
hereof. This Agreement replaces and supersedes any and all previous or
contemporaneous statements, representations, understandings, and agreements
regarding the subject matter hereof, whether written or oral, between the
parties hereto, including the February 2, 1995 Letter Agreement and the February
10, 1995 Letter of Intent between them.
19.12 This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which shall constitute one and
the same instrument.
-15-
16
9. Exhibits
The following Exhibits are attached to this Agreement:
Exhibit 1 Keyboard Product Description
Exhibit 2 PaperPort Product Software Description
Exhibit 3 Initial Customization Project
Exhibit 4 Compaq Standard License Agreement
Exhibit 5 Royalty Schedule
Exhibit 6 Sales Volume Forecast
Exhibit 7 Manufacturing Information
Exhibit 8 Restrictions On Trademark Use
Exhibit 9 Escrow Agreement
COMPAQ COMPUTER CORPORATION VISIONEER COMMUNICATIONS, INC.
By:______________________________ By:______________________________
Name:____________________________ Name:____________________________
Title:___________________________ Title:___________________________
-16-
17
EXHIBIT 1
KEYBOARD PRODUCT DESCRIPTION
OVERVIEW
The following description outlines the features and functions of an Integrated
input device combining a scanner (PaperPort) and a standard keyboard (XXXXX) to
create a device for inputting typed data as well as paper based information into
personal computers.
1.0 INDUSTRIAL DESIGN
The keyboard product will be designed to be visually compatible with present and
future Compaq products as specified by Compaq. (See attached design drawing).
2.0 XXXX KEYBOARD ASSEMBLY
Compaq has selected the XXXXX keyboard assembly for the Keyboard product. The
keyboard assembly will be designed and engineered working from the basic
technology and designs of the existing XXX product with little to no
modifications. This product is to comply with the Compaq design requirements and
specifications. (See specification XXXX (Keyboard Scanner) and XXXX (OptionKit).
3.0 SCANNER ASSEMBLY
The scanner module will be designed and engineered working from the basic
technology and designs of the existing Visioneer PaperPort product. The
mechanics will be slightly modified to accommodate the keyboard physical
dimensions and will include the following components:
XXXXX
XXXXX
XXXXX
XXXXX
XXXXX
XXXXX
(For specific functional information both mechanical and electrical refer to the
Visioneer Electrical Specification and the Visioneer Product Design
Specification.)
4.0 USER INTERFACE
-17-
XXX = Confidential Treatment Requested
18
The Keyboard will have the following primary interfaces to the user.
4.1 STANDARD KEYBOARD KEYSWITCHS
Per the XXXX Keyboard Specification and Compaq XXXX requirements.
4.2 DATA/POWER INTERFACE CABLE
The Keyboard will have a single cable exiting the enclosure at a
standard length of XX feet minimum which will have XXX separate
connections positioned at the end of the cable closest to the CPU. The
first of the XXX connections is a standard XXX keyboard connector, the
second will be a XXX serial connector, and the third will be a
receptacle which accepts the plug from the power adapter.
4.3 DOCUMENT INSERTION PATH
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX.
4.4 OPERATOR BUTTON
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX.
4.5 PAPER RETURN COVER
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX.
-18-
XXX = Confidential Treatment Requested
19
4.6 TILT FEET
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX.
4.7 WALL MOUNT POWER ADAPTER
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX.
5.0 REFERENCE DOCUMENTS
Visioneer Electrical Design Specification
Visioneer Product Design Specification
Visioneer Software Design Specification
Compaq Keyboard Specification
Visioneer Bill of Materials
6.0 FURTHER SPECIFICATIONS TO BE DEFINED
6.1 Logo definition and placement
6.2 Labeling for: Agency, serialization, spares etc.
6.3 User Warning label
6.4 Safety and Comfort Guide
6.5 Packaging
6.6 Test process, procedures, and requirements for the Scanner
Module as delivered to keyboard supplier XXXXX.
-19-
XXX = Confidential Treatment Requested
20
EXHIBIT 2
PAPERPORT PRODUCT SOFTWARE DESCRIPTION
This Exhibit defines the software and documentation which makes up the Software
Product to be delivered by Visioneer to Compaq.
1. Definitions
1.1 Software Product
The Software Product is defined as including, but not limited
to, all functionality in the reference version, plus all
additions and less all deletions as listed in this Exhibit.
The reference version of the software product is XXXXXXXXXX.
1.3 Documentation
The printed documentation is defined to be the electronic form
of the paper documentation associated with the software
product. Documentation is to be delivered in Visioneer's
existing electronic format XXXXXXXXXXXXX. Compaq assumes the
responsibility of adapting these electronic files to Compaq's
publications tools, as well as adapting publications content
to its needs. Visioneer retains the right to review and
comment on final versions of the documentation, with
sufficient lead time to effect proper review and modification
as necessary.
2. System Requirements
The Software Product will function correctly in all of the following
computer environments. Certain functions in the Software Product may
not be functional without certain system hardware or software
available. Those functions will be determined by mutual agreement
between Compaq and Visioneer.
2.1 XXXXXXXXX
2.1(a) System Software
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX.
2.1(b) System Hardware
-20-
XXX = Confidential Treatment Requested
21
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX.
2.1(c) Minimum Hardware
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX.
2.1(c) Supported Hardware
As defined in paragraph 7.4, Compaq will supply
Visioneer with the model name (or internal code name)
and one pilot version of each computer system which
must be supported. These configurations will be
limited to systems manufactured and sold by Compaq.
Although Visioneer will take no steps to restrict
functionality on other systems, there is no specific
requirement to test the Software Product on other
systems.
3. Software Product Features
Compaq is responsible for modification of all associated electronic and
printed documentation.
3.1 Localization
The Software Product will be provided to Compaq localized in
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX are to be
determined and expenses and payments are to be negotiated by
the parties in good faith.
3.2 Logos and Trademarks
The product name is to be determined but shall prominently
display "PaperPort." The Software Product will include
Visioneer's product labels and logos, including the product
name stem "PaperPort," the company name "Visioneer," the
iconographic "V" used in the program icon and preferences
icon, and the icon for "max" files created by the software
product in a manner identical or similar to the reference
version. Visioneer will consider in good faith requests by
Compaq to include Compaq logos and trademarks in the Software
Product.
3.2.1 Splashscreen and About Box
The splashscreen is the graphic that displays during
the interval that the software product is loading
into memory. The about box is the graphic that is
shown when the user selects "About PaperPort" from
the help menu item. Compaq will supply Visioneer with
a bitmap to be used in the "splashscreen" and "about
box" of the product. The splashscreen shall conform
to the same color palette and dimensions as the
reference version.
-21-
XXX = Confidential Treatment Requested
22
The about box shall be modified in a similar fashion. The suitability of the
bitmaps will be mutually agreed.
3.2.2 Contacting Visioneer
The menu item and screen referring to "contacting
Visioneer" under the help menu shall be deleted.
3.2.3 References in "One Minute Guide" and online help
These references will be modified to reflect the
proper name of the hardware product.
3.3 XXX Features
The Software Product will include an XXX capability that is
either identical, equivalent in functionality and performance,
or improved compared to the reference version.
3.3(a) XXX Localization
Visioneer will localize the user interface required
by the XXXXXXX and provide localized recognition in
that language in coordination with the localization
of the rest of the Software Product.
3.4 Registration
Registration screens will be deleted from the
software product.
3.5 Deleted features
For the Compaq version, the following features
present in the references release will be removed or
disabled:
Pre-configured calibration.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX.
3.6 Additional features
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX.
4. Installation
XXXXXXXXXXXXXXXXXXXXXXXXXXXXX. Compaq will adapt this product as
necessary to work correctly in pre-installed hard disk configurations.
-22-
XXX = Confidential Treatment Requested
23
5. Links
5a. The Software Product will include the following PaperPort
links in addition to those included in the reference version,
provided that versions of these application programs can be
provided to Visioneer as specified in Section 7 below:
XXXXXXXXXXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXXXXXX
5b. Cooperative work on additional links
Compaq and Visioneer agree to make reasonable efforts to
influence the following software vendors to modify their
products to work with PaperPort, and/or to provide PaperPort
links with their products. In the event that links are
available to these products by the start of the beta test
period, they will be included in the Software Product. It is
not intended that this list be construed to exclude other
software vendors.
XXXXXXXX
XXXXXXXX
6. Delivered Materials
Visioneer will deliver a single copy of the software product in binary
form on diskettes for each localized version. Compaq will be
responsible for final packaging, duplication, and labeling of the
software product. Compaq will be responsible for the adaptation and
duplication of printed documentation as appropriate.
7. Preliminary Development Schedule and Deliverables
7.1 Start of project TBD
The specifications in this exhibit are accepted by both
parties, and the proper authorizations for project start have
been signed off.
7.2 Delivery of beta version of references product XXXXXX
-23-
XXX = Confidential Treatment Requested
24
On or before this date, Visioneer will provide Compaq with
developmental version of the Software Product. This version
does not necessarily include customizations or adaptations as
specified in this exhibit. This version is XXXX only.
7.3 Delivery of customization materials XXXX
Compaq delivers to Visioneer the final splashscreen and other
artwork, logos, product and trade names as specified in this
exhibit. Compaq delivers to Visioneer developmental versions
of all linked applications as specified in Section 5a.
7.4 Delivery of Supported hardware XXXX
Compaq delivers to Visioneer at least one comparable system
configuration that Visioneer must support.
7.5 Delivery of Alpha test product XXXX
Visioneer has implemented all functionality as specified in
this exhibit. This is equivalent to Visioneer's XXXX releases
with the addition of Compaq custom features as specified in
this exhibit.
7.6 Delivery of fully-functional versions of linked products XXXX
Compaq delivers to Visioneer developmental versions of all
linked applications as specified in section 5a.
7.7 Delivery of Beta test product XXXX
Visioneer has implemented all functionality and removed
defects as specified in this exhibit. However, to this point
all testing has been on the reference version of Visioneer's
XXXX hardware, rather than the actual keyboard scanner.
Beginning with this delivery:
Visioneer will make available approximately weekly updates of
the Software Product, defect reports, test reports and updated
test scripts to Compaq. Test reports will include Visioneer's
regularly generated information on what defects were found and
fixed.
7.8 External beta begins XXXX
Compaq may begin to distribute the Software Product to third
parties for external Beta testing. Compaq will provide
Visioneer with detailed reports on external beta testing
experience, including number and description of sites,
qualitative comments from users, and defect reports.
7.9 Beta test complete XXXX
The Beta testing phase for the Software Product is completed.
All critical and serious defects, if not fixed, must be
resolved by mutual agreement between Compaq and Visioneer.
7.10 Begin code freeze XXXX
-24-
XXX = Confidential Treatment Requested
25
The Software Product enters into a XXXX code freeze period.
Any changes made to the Software Product after this point must
be mutually agreed to by Compaq and Visioneer.
7.11 XXXX Golden master released to Compaq
Compaq receives golden master while Visioneer continues to
regression test frozen version though XXXX.
7.12 Not to exceed XX days after 7.11 - XXX Gold Delivery
Compaq determines if all XXX versions of the Software Product
are accepted.
8.0 Infrastructure and process
Visioneer and Compaq agree to institute technical infrastructure,
including but not limited to XXXXXX, that will facilitate smooth
interaction during the development and test phases of this project.
Visioneer and Compaq agree to designate a project manager who is
authorized to speak authoritatively for their respective company on all
matters related to interpretation and modification of this exhibit.
These project managers will confer at least weekly by telephone and
monthly in person on all outstanding issues.
Compaq will provide Visioneer with a list of all of their products on
which the software product is supported. Compaq will provide at least
one unit of each of these configurations to Visioneer on loan for the
duration of this agreement.
-25-
XXX = Confidential Treatment Requested
26
EXHIBIT 3
INITIAL CUSTOMIZATION PROJECT
WORK PLAN FOR INTEGRATED COMPAQ KEYBOARD DESIGN
FUNCTION: INDUSTRIAL DESIGN: MECHANICAL DESIGN:
DESCRIPTION: Phase 1 (2) Concept Designs Mechanical concepts
(2 different designs) Mechanical layouts
Phase 1 (2) Concept Models
(1 model for each design)
DELIVERABLES: (*)Concept models - two (2) units Mechanical design
(i.e., non-working mock-ups) (i.e., drawings)
(*) includes Industrial and Mechanical Designs Supported
Documentation
SCHEDULE: completed by XXX completed by XXX
PAYMENT TERMS: Compaq agrees to reimburse Visioneer's actual expenses
for engineering and consulting fees payable to third parties in
connection with this project statement up to the amount of
XXXXXXXXXXXXXXXXXXXXXXXXXXX. In addition, Compaq will pay
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXX to cover Visioneer's internal
development resources and will reimburse actual travel expenses
provided they comply with the guidelines outlined below. These amounts
will become payable as follows: (1) XXXXXXXXXXXXXXXXXXX of the
estimated total expenses upon execution of the Letter Agreement dated
February 2, 1995 ("Letter Agreement"), and (2) the remainder of the
actual amounts payable, up to the specified limits, upon Compaq's
acceptance of the final deliverables described above.
Invoicing: Payments due to Visioneer for this Customization Project
shall be invoiced to Compaq not later than the thirty (30) days
following the date on which the work was performed and accepted. Any
such invoice shall be payable net forty-five (45) days following its
receipt by Compaq. Each such invoice shall identify this contract and
separately enumerate the basis for payment and its calculation (i.e.,
"payment due upon contract signing" or the tasks performed). Each
invoice shall be subject to verification by Compaq's representatives
with regards to the accuracy of the amount invoiced for work performed
and expense reimbursements shall be supported by appropriate receipts .
Invoices shall be submitted in duplicate to the person for whom
Visioneer is working, c/o Compaq Computer Corporation, P. O. Box
629000, Houston, Texas, 77269-2000.
Travel Expenses: Reimbursement charges for pre-approved travel
expense shall be separately invoiced by Visioneer monthly at the same
time it shall invoices Compaq for work performed under this
Customization Project. Travel expense invoices shall
-26-
XXX = Confidential Treatment Requested
27
separately enumerate each such expense actually incurred, and shall be
accompanied by such documentation as shall be reasonably necessary to
verify the amount, date, and nature of each such expense, including all
receipts. Upon request, Visioneer shall provide additional
documentation in the form of receipts, vouchers, invoices, and the like
that pertain to and further substantiate and verify any such travel
expense, and the receipt thereof by Compaq, when requested, shall be a
condition precedent to payment. To be considered reimbursable
hereunder, travel expenses must also comply with the following
conditions:
Airfare: Coach only. Any upgrades must be approved prior to
finalization of flight reservation.
Lodging: Single or double occupancy only. Any upgrades must be approved
prior to finalization of room reservation.
Food: Receipts for all charges should be provided. No liquor or guest
charges will be accepted, unless approved by a Compaq representative.
Entertainment: All anticipated charges should be approved by Compaq
representative.
Other than the above, no expenses of Visioneer incurred or arising out
of the work performed under this Letter Agreement shall be
reimbursable.
If the parties enter into a comprehensive agreement in regard to the
subject products, then all payments made by Compaq under this Letter
Agreement shall be treated as advances against future payments due
thereunder and credited against amounts that may become payable by
Compaq to Visioneer under any such comprehensive agreement.
-27-
28
COMPREHENSIVE AGREEMENT
NRE DEVELOPMENT ACTIVITIES
FOR
INTEGRATED COMPAQ KEYBOARD DESIGN
FUNCTION: Industrial Design Mechanical Design
DESCRIPTION: Phase II Design Completion Complete detailed designs of
(1) Design fully detailed Compaq specific parts
DELIVERABLES: Fully detailed hard model 3-D geometry files
Final control drawings Detailed parts drawings
TOTAL PROJECT NRE SPENDING SUMMARY
(Phase I) (Phase II)
Initial Customization Project Comprehensive Agreement
Industrial Design XXXXXX XXXXXX
Mechanical Design XXXXXX X
Visioneer Resources XXXXXX X
XXXXXXX XXXXXX
Incurred Travel XXXXXX
Phase I XXXXXXX
Phase II Exp. XXXXXX
TOTAL XXXXXXXX
Original Estimate XXXXXXXX
-28-
XXX = Confidential Treatment Requested
29
EXHIBIT 4
Compaq Standard License Agreement
PROGRAM LICENSE AGREEMENT FOR U.S.A.
PLEASE REVIEW THE FOLLOWING TERMS AND CONDITIONS CAREFULLY BEFORE OPENING THIS
PACKAGE. BY OPENING THIS PACKAGE, YOU INDICATE YOUR ACCEPTANCE OF SUCH TERMS AND
CONDITIONS. IN THE EVENT THAT YOU DO NOT AGREE TO THESE TERMS AND CONDITIONS,
YOU SHOULD PROMPTLY RETURN THE PACKAGE UNOPENED. YOUR MONEY WILL BE REFUNDED.
Pursuant to this Agreement, you may: (a) use the programs on a single computer;
(b) copy the programs into any computer in readable or printed form for back-up
or modification purposes in support of your use of the programs (certain
programs, however, may include mechanisms to limit or inhibit copying; they are
marked "copy protected); (c) modify the programs and/or merge it into another
program for your use on the single computer; and (d) transfer the programs and
license to another party if the other party agrees to accept the terms and
conditions of this Agreement.
Any portion of these programs merged into another program will continue to be
subject to the terms and conditions of this Agreement. If you transfer the
programs to another party, you must at the same time either transfer all copies
whether in printed or computer readable form to the same party or destroy any
copies not transferred, including all modifications and portions of the programs
contained or merged into other programs. You must also reproduce and include the
copyright notice on any copy, modification, or portion merged into another
program.
YOU MAY NOT USE, COPY, MODIFY, OR TRANSFER THE PROGRAMS OR ANY COPY,
MODIFICATION, OR MERGED PORTION, IN WHOLE OR PART, EXCEPT AS EXPRESSLY PROVIDED
FOR IN THIS AGREEMENT. IF YOU TRANSFER POSSESSION OF ANY COPY, MODIFICATION, OR
MERGED PORTION OF THE PROGRAMS TO ANOTHER PARTY, YOUR LICENSE IS AUTOMATICALLY
TERMINATED.
If the SOFTWARE package contains both 3-1/2-inch and 5-1/4-inch diskettes, then
you may use only the diskettes appropriate for your single-user computer. You
may not use the other diskettes on another computer or loan, rent, lease, or
transfer them to another user except as part of the permanent transfer (as
provided above) of all SOFTWARE and written materials.
TERM
The license is effective until terminated. You may terminate it at any other
time by destroying the programs together with all copies, modifications and
merged portions in any form. It will also terminate upon conditions set forth
elsewhere in this Agreement or if you fail to comply with any term or condition
of this Agreement. You agree upon such termination to destroy the programs
together with all copies, modifications, and merged portions in any form.
LIMITED WARRANTY AND REMEDIES
Compaq Computer Corporation warrants the diskette(s) on which the programs are
furnished, to be free from defects in materials and workmanship under normal use
for a period of one year from the date of delivery to you as evidenced by a copy
of your receipt. This warranty is limited to the original purchaser and is not
transferable.
During the one year warranty period, Compaq will (1) replace any diskette not
meeting the foregoing warranty and which is returned to Compaq or an Authorized
Compaq Computer Reseller ("Authorized Reseller") with a copy of your receipt; or
(2) if Compaq or the Authorized Reseller is unable to deliver a replacement
diskette which is free of defects in materials or workmanship, you may terminate
this Agreement by returning the programs and your money will be refunded.
THE FOREGOING WARRANTY DOES NOT EXTEND TO ANY DISKETTE WHICH HAS BEEN DAMAGED AS
A RESULT OF ACCIDENT, MISUSE, ABUSE, OR AS A RESULT OF SERVICE OR MODIFICATION
BY ANYONE OTHER THAN COMPAQ OR AN AUTHORIZED RESELLER.
EXCEPT AS EXPRESSLY SET FORTH ABOVE, NO OTHER WARRANTIES, EITHER EXPRESS OR
IMPLIED, ARE MADE WITH RESPECT TO THESE PROGRAMS, INCLUDING BUT NOT LIMITED TO
THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE,
AND COMPAQ AND ITS SUPPLIERS EXPRESSLY DISCLAIM ALL WARRANTIES NOT STATED
HEREIN. YOU ASSUME THE ENTIRE RISK AS TO THE QUALITY AND PERFORMANCE OF THE
PROGRAMS. SHOULD THE PROGRAMS PROVE DEFECTIVE, YOU -- AND NOT COMPAQ OR ITS
SUPPLIERS OR AN AUTHORIZED RESELLER -- ASSUME THE ENTIRE COST OF NECESSARY
SERVICING, REPAIR, OR CORRECTION. SOME STATES DO NOT ALLOW THE EXCLUSION OF
IMPLIED WARRANTIES, SO THE ABOVE EXCLUSION MAY NOT APPLY TO YOU. THIS WARRANTY
GIVES YOU SPECIFIC LEGAL RIGHTS, AND YOU MAY ALSO HAVE OTHER RIGHTS WHICH VARY
FROM STATE TO STATE.
Some of the programs contained on these diskettes have been optimized to run on
Compaq-specific hardware. Therefore, some of the programs on these diskettes may
not run as effectively or may cause errors in data or operation when this
software is loaded on non-Compaq products. Compaq does not warrant that the
functions contained in the programs will meet your requirements or that the
operation of the programs will be uninterrupted or error-free. You assume
responsibility for the selection of the programs and hardware to achieve your
intended results; and for the installation, use and results obtained from the
programs.
YOUR SOLE REMEDIES AND THE ENTIRE LIABILITY OF COMPAQ COMPUTER CORPORATION AND
ITS SUPPLIERS ARE SET FORTH ABOVE. IN NO EVENT WILL COMPAQ OR ITS SUPPLIERS BE
LIABLE TO YOU OR ANY OTHER PERSON FOR ANY DAMAGES, INCLUDING ANY INCIDENTAL OR
CONSEQUENTIAL DAMAGES, EXPENSES, LOST PROFITS, LOST SAVINGS, OR OTHER DAMAGES
ARISING OUT OF USE OF OR INABILITY TO USE SUCH PROGRAMS.
SOME STATES DO NOT ALLOW THE LIMITATION OR EXCLUSION OF INCIDENTAL OR
CONSEQUENTIAL DAMAGES FOR CONSUMER PRODUCTS, SO THE ABOVE LIMITATIONS OR
EXCLUSIONS MAY NOT APPLY TO YOU.
GENERAL
You may not sublicense, assign, or transfer the license or the programs except
as expressly provided in this Agreement. Any attempt to otherwise sublicense,
assign, or transfer any of the rights, duties, or obligations hereunder is null
and void.
If you have any questions concerning this Agreement, including warranty service,
you should contact Compaq Computer Corporation, P.O. Box 692000, Houston, Texas
77269-2000.
This Agreement will be governed by the laws of the State of Texas.
YOU ACKNOWLEDGE THAT YOU HAVE READ THIS AGREEMENT, UNDERSTAND IT, AND AGREE TO
BE BOUND BY ITS TERMS AND CONDITIONS: YOU FURTHER AGREE IT IS THE COMPLETE AND
EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US WHICH SUPERCEDES ANY PROPOSAL OR
PRIOR AGREEMENT, ORAL OR WRITTEN AND ANY OTHER COMMUNICATIONS BETWEEN US
RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT.
U.S. GOVERNMENT RESTRICTED RIGHTS
This program and documentation are provided with RESTRICTED RIGHTS. Use,
duplication, or disclosure by the Government is subject to restrictions as set
forth in subdivision (c)(1)(ii) of the Rights in Technical Data and Computer
Software clause at 252.22 7-7013. Contractor/manufacturer is Compaq Computer
Corporation, 20555 SH 249, Houston, Texas 77070.
30
PROGRAM LICENSE AGREEMENT FOR U.K.
1.1 PLEASE REVIEW THE FOLLOWING TERMS AND CONDITIONS CAREFULLY BEFORE
OPENING THIS PACKAGE. BY OPENING THIS PACKAGE, YOU INDICATE YOUR
ACCEPTANCE OF SUCH TERMS AND CONDITIONS. IN THE EVENT THAT YOU DO NOT
AGREE TO THESE TERMS AND CONDITIONS, YOU SHOULD PROMPTLY RETURN THE
PACKAGE UNOPENED. YOUR MONEY WILL BE REFUNDED.
1.2 "The Programs" means "the software programs stored on the diskettes in
this package."
1.3 Pursuant to this Agreement, you may: (a) use the programs on a single
computer; (b) copy the programs into any computer in readable or
printed form for back-up or modification purposes in support of your
use of the programs (certain programs, however, may include mechanisms
to limit or inhibit copying; they are marked "copy protected"); (c)
modify the programs and/or merge it into another program for your use
on the single computer; and (d) transfer the programs and license to
another party if the other party agrees to accept the terms and
conditions of this Agreement.
1.4 Any portion of these programs merged into another program will continue
to be subject to the terms and conditions of this Agreement. If you
transfer the programs to another party, you must at the same time
either transfer all copies whether in printed or computer readable form
to the same party and destroy any copies not transferred, including all
modifications and portions of the programs contained or merged into
other programs. You must also reproduce and include the copyright
notice on any copy, modification, or portion merged into another
program.
1.5 YOU MAY NOT USE, COPY, MODIFY, OR TRANSFER THE PROGRAMS OR ANY COPY,
MODIFICATION, OR MERGED PORTION, IN WHOLE OR PART, EXCEPT AS EXPRESSLY
PROVIDED FOR IN THIS AGREEMENT. IF YOU TRANSFER POSSESSION OF ANY COPY,
MODIFICATION, OR MERGED PORTION OF THE PROGRAMS TO ANOTHER PARTY, YOUR
LICENSE IS AUTOMATICALLY TERMINATED.
1.6 If the SOFTWARE package contains both 3-1/2-inch and 5-1/4-inch
diskettes, then you may use only the diskettes appropriate for your
single-user computer. You may not use the other diskettes on another
computer or loan, rent, lease or transfer them to another user except
as part of the permanent transfer (as provided above) of all SOFTWARE
and written materials.
2.0 TERM
2.1 The license is effective until terminated. You may terminate it at any
other time by destroying the programs together with all copies,
modifications and merged portions in any form. It will also terminate
upon conditions set forth elsewhere in this Agreement or if you fail to
comply with any term or condition of this Agreement. You agree upon
such termination to destroy the programs together with all copies,
modifications, and merged portions in any form.
3.0 LIMITED WARRANTY AND REMEDIES
3.1 Compaq Computer Corporation warrants the diskette(s) on which the
programs are furnished, to be free from defects in materials and
workmanship under normal use for a period of one year from the date of
delivery to you as evidenced by a copy of your receipt. This warranty
is limited to the original purchaser and is not transferable.
3.2 During the one year warranty period, Compaq will (1) replace any
diskette not meeting the foregoing warranty and which is returned to
Compaq or an Authorized Compaq Computer Reseller ("Authorized
Reseller") with a copy of your receipt; or (2) if Compaq or the
Authorized Reseller is unable to deliver a replacement diskette which
is free of defects in materials or workmanship, you may terminate this
Agreement by returning the programs and your money will be refunded.
3.3 THE FOREGOING WARRANTY DOES NOT EXTEND TO ANY DISKETTE WHICH HAS BEEN
DAMAGED AS A RESULT OF ACCIDENT, MISUSE, ABUSE, OR AS A RESULT OF
SERVICE OR MODIFICATION BY ANYONE OTHER THAN COMPAQ OR AN AUTHORIZED
RESELLER.
3.4 EXCEPT AS EXPRESSLY SET FORTH ABOVE, OR AS REQUIRED BY STATUTE, NO
OTHER WARRANTIES, EITHER EXPRESS OR IMPLIED, ARE MADE WITH RESPECT TO
THESE PROGRAMS, INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AND COMPAQ AND
ITS SUPPLIERS EXPRESSLY DISCLAIM ALL WARRANTIES NOT STATED HEREIN. YOU
ASSUME THE ENTIRE RISK AS TO THE QUALITY AND PERFORMANCE OF THE
PROGRAMS. SHOULD THE PROGRAMS PROVE DEFECTIVE, YOU -- AND NOT COMPAQ OR
ITS SUPPLIERS OR AN AUTHORIZED RESELLER -- ASSUME THE ENTIRE COST OF
NECESSARY SERVICING, REPAIR, OR CORRECTION.
35. Some of the programs contained on these diskettes have been optimized
to run on Compaq-specific hardware. Therefore, some of the programs on
these diskettes may not run as effectively or may cause errors in data
or operation when this software is loaded on non-Compaq products.
Compaq does not warrant that the functions contained in the programs
will meet your requirements or that the operation of the programs will
be uninterrupted or error-free. You assume responsibility for the
selection or the programs and hardware to achieve your intended
results; and for the installation, use and results obtained from the
programs.
36. YOUR SOLE REMEDIES AND THE ENTIRE LIABILITY OF COMPAQ COMPUTER
CORPORATION AND ITS SUPPLIERS ARE SET FORTH HEREIN. IN NO EVENT WILL
COMPAQ OR ITS SUPPLIERS BE LIABLE TO YOU OR ANY OTHER PERSON FOR ANY
DAMAGES, INCLUDING ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES, EXPENSES,
LOST PROFITS, LOST SAVINGS, OR OTHER DAMAGES ARISING OUT OF USE OF OR
INABILITY TO USE SUCH PROGRAMS EXCEPT IN RESPECT OF INJURY (INCLUDING
DEATH) TO ANY PERSON CAUSED BY COMPAQ'S NEGLIGENCE.
4.0 GENERAL
4.1 If any provision of this License is declared void or unenforceable by
any judicial or administrative authority, this shall not nullify the
remaining provisions of the License which shall remain in full force
and effect.
4.2 You may not sublicense, assign, or transfer the license or the programs
except as expressly provided in this Agreement. Any attempt to
otherwise sublicense, assign, or transfer any of the rights, duties, or
obligations hereunder is null and void.
4.3 If you have any questions concerning this Agreement, including warranty
service, you should contact Compaq Computer Limited, Hotham House, 1
Heron Square, Richmond, Surrey TW9 1EJ.
4.4 This Agreement will be governed and construed in accordance with the
laws of England.
4.5 YOU ACKNOWLEDGE THAT YOU HAVE READ THIS AGREEMENT, UNDERSTAND IT, AND
AGREE TO BE BOUND BY ITS TERMS AND CONDITIONS. YOU FURTHER AGREE IT IS
THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US WHICH
SUPERCEDES ANY PROPOSAL OR PRIOR AGREEMENT, ORAL OR WRITTEN AND ANY
OTHER COMMUNICATIONS BETWEEN US RELATING TO THE SUBJECT MATTER OF THIS
AGREEMENT.
This license agreement applicable outside United States and its territories.
-29A-
31
EXHIBIT 5
ROYALTY SCHEDULE
A. Integrated Keyboard
Volume Per Unit Royalty
XXXXXXXXXX XXXXXX
XXXXXXXXXXXXX XXXXXX
XXXXXXXXXXXXX XXXXXX
B. Standalone Keyboard
Volume Per Unit Royalty
XXXXXXXXXX XXXXXX
XXXXXXXXXXXXX XXXXXX
XXXXXXXXXXXXX XXXXXX
XXXXXXXXXXXXX XXXXXX
Other:
1. When Compaq achieves XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXX units in
a quarter for combined Integrated Keyboard and Standalone Keyboard products, the
per unit royalty for the Integrated and Standalone Keyboard products will be XXX
and XXX respectively, in the quarter.
2. After the XXX anniversary date of the Agreement, if Compaq reduces its
distributor list prices for the Standalone Keyboard Product, the per unit
royalty for the Standalone and Integrated Keyboard Products will also be
immediately reduced by the same percentage as Compaq's price reduction.
3. The per unit royalty achieved is applied to total cumulative volumes for each
product category.
4. The per unit royalty includes hardware, software, support, and documentation
as described in the Agreement.
5. Separate software per copy royalties are to be negotiated as provided in the
Agreement.
-30-
XXX = Confidential Treatment Requested
32
Compaq/Visioneer Confidential
EXHIBIT 6
SALES VOLUME FORECAST
Compaq will forecast quarterly volumes and provide the information to Visioneer
for planning purposes only. The following unit estimate is Compaq's estimate for
bundled system sales. Compaq exclusivity would expire if Compaq does not ship
XXXXXXXXXXXXXXXXXXX of the forecasted quarterly volumes during any quarter of an
exclusive period.
1Q 2Q 3Q 4Q FULL YEAR
1996 XXXXXXXXXXXXXXXXXXXXXX
1997 XXXXXXXXXXXXXXXXXXXXXX
-31-
XXX = Confidential Treatment Requested
33
Compaq/Visioneer Confidential
EXHIBIT 7
VISIONEER MANUFACTURING & HARDWARE DESIGN DATA SUMMARY
THE ELECTRICAL SECTION DESCRIBES 4 MAJOR CATEGORIES.
- XXXXXXX
- XXXXXXX
- XXXXXXX
- XXXXXXX
THE PRODUCT DESIGN SPECIFICATION DESCRIBES:
The technical description and specifications required for the
design of a Visioneer scanner including measurable parameters
of mechanical product design and performance.
THE BILL OF MATERIAL DESCRIBES:
All electrical and mechanical components required for the
Visioneer scanner.
THE ENVIRONMENTAL TEST REPORT DESCRIBES:
XXXXXXXXXXXXXXXXXXXX.
THE EMC SCANS DESCRIBE:
XXXXXXXXXXXXXXXXXXXX.
ASSEMBLY DRAWINGS DESCRIBE:
How to assemble the scanner chassis, flag assembly, and a CIS
assembly of a Visioneer scanner.
MISCELLANEOUS:
The above provides XXX basic needs to produce the Scanner portion. To
integrate scanner with the keyboard, regular meetings between XXX and
Visioneer are required to discuss the following.
- Work the details relating to approved vendors and costs for
all the components (PCB and otherwise). A list of such
vendors and components has previously been supplied by
Visioneer to Compaq.
- Discussions of individual PCB component performance
parameters.
- Discussions of performance parameters on other scanner
parts (motor, etc.)
- Visioneer's mechanical input to XXX for the detailed part
designs and CAD files recommending how to mount the scanner
into the XXX XXXXXX keyboard.
-32-
XXX = Confidential Treatment Requested
34
Compaq/Visioneer Confidential
- XXX mechanical input back to Visioneer (mounting scanner
into keyboard and engineering producible part designs).
- Visioneer's CAD files to XXX on all currently manufactured
parts and Visioneer's help to XXX on Scanner Production
test methods, etc.
Contact: XXXXX, Compaq
-33-
XXX = Confidential Treatment Requested
35
Compaq/Visioneer Confidential
EXHIBIT 8
RESTRICTIONS ON TRADEMARK USE
All Products sold by Compaq shall be affixed with copyright notices of
Visioneer sufficient to give notice as to the rights of Visioneer in the
Products. The Products and all related packaging, documentation and screens
shall include Visioneer's name and trademarks in a manner and location
reasonably satisfactory to Visioneer. The trademarks covered by the license to
Compaq include the following:
Visioneer
PaperPort
Paper Driven
-34-
36
Compaq/Visioneer Confidential
EXHIBIT 9
ESCROW AGREEMENT
SOFTWARE ESCROW AGREEMENT
This agreement ("Agreement") is made as the _____ day of ____, 1995, by and
between Compaq Computer Corporation, a Delaware corporation, ("COMPAQ"),
Visioneer Communications, Inc., a California corporation ("LICENSOR"), and Data
Securities International, a California corporation, with a principal place of
doing business at 67 South Bedford Street, Burlington, MA 01803 ("ESCROW
AGENT").
RECITALS:
A. COMPAQ is a licensee of the LICENSOR's Software identified on Exhibit A, as
may be amended from time to time, pursuant to the License and Distribution
Agreement with an effective date of __________, 1995, by and between LICENSOR
and COMPAQ ("License Agreement").
B. The parties desire to place certain source code and related materials for
LICENSOR's Software with the ESCROW AGENT for protection and possible release of
such source code and related materials in accordance with this Agreement.
C. Unless otherwise defined herein, all capitalized terms shall have the
meanings ascribed to them in the License Agreement.
Therefore, in consideration of the promises and mutual convenants
below, COMPAQ, LICENSOR, and ESCROW AGENT agree as follows:
I. ESCROW ITEMS
A. Within sixty (60) days after execution of the License Agreement, LICENSOR
shall deliver to ESCROW AGENT and, pursuant to the terms and conditions set out
herein, deposit into escrow one copy of all currently existing source code for
the Software, Enhancements and Error Corrections ("the Deposit"). Within five
(5) days after receipt of the Deposit, ESCROW AGENT shall notify COMPAQ and
LICENSOR of receipt. All costs associated with the establishment and maintenance
of such escrow, shall be borne by COMPAQ.
B. (i) The Deposit shall be accompanied by a description of any public domain
software, as well as any software under license from a third party to LICENSOR
incorporated into the Software.
(ii) In the case of third party software incorporated into the
Software, LICENSOR shall
-35-
37
(a) deposit such licensed software only to the extent to which
LICENSOR is entitled to do so under such license;
(b) specify which portions of such licensed software have been
included in, and excluded from, the deposit;
(c) identify the owner or other licensor of such software; and
(d) to the best of LICENSOR's knowledge at the time, describe
how COMPAQ may seek to license such software after release of
the Deposit.
C. LICENSOR shall revise and update the Deposit semi-annually or as necessary to
keep it current and in good working order.
II. RELEASE CONDITIONS
A. During the term of the License Agreement, (a) upon the occurrences of one of
the following release conditions, and (b) provided COMPAQ is not in material
breach of the License Agreement; and (c) provided LICENSOR has been fully paid
all outstanding license fees, royalties and other payments due LICENSOR, COMPAQ
shall be authorized to submit to the ESCROW AGENT the Notice referred to in
Paragraph IV A below demanding the release of the Deposit upon the occurrence of
one of the release conditions set forth in Section 18.2 of the License
Agreement.
III. DUTIES OF THE ESCROW AGENT
A. The ESCROW AGENT represents that it ordinarily deals in services related to
the storage of confidential documents, including computer media.
B. The ESCROW AGENT's duties hereunder are limited to:
(i) Safeguarding the Deposit against disclosure to or access by any
person or entity except as expressly provided herein, including the
safekeeping of the Deposit in a safety deposit box in its secure
warehouse specializing in the storage of confidential documents
including computer media;
(ii) Notifying COMPAQ and LICENSOR that it has received the Deposit;
(iii) Notifying COMPAQ and LICENSOR that is has received from LICENSOR
any updated version of the Deposit;
(iv) Receiving Notice in accordance with Section IV (B) below; and
-36-
38
(v) Disposition of the Escrow Items in accordance with these
instructions.
C. The ESCROW AGENT is not responsible for verifying the accuracy or
completeness of the Deposit. The ESCROW AGENT's performance hereunder is excused
when it is prevented by acts of god and other causes beyond its reasonable
control.
D. Upon non-renewal or other termination of this Agreement, ESCROW AGENT shall
return the Deposit to LICENSOR and all fees related to such return shall be paid
by COMPAQ.
E. ESCROW AGENT acknowledges LICENSOR's assertion that the Deposit shall contain
proprietary information and the ESCROW AGENT has an obligation to preserve and
protect the confidentiality of the Deposit. LICENSOR grants ESCROW AGENT the
irrevocable right to duplicate the Deposit only as necessary to preserve and
safely store the Deposit and to provide a copy thereof as authorized herein to
COMPAQ. Except as provided for in the Agreement, ESCROW AGENT agrees that it
shall not divulge, disclose, make available to third parties, or make any use
whatsoever of the Deposit.
IV. RELEASE OF DEPOSIT
A. Upon receipt of written notice, signed by an officer of COMPAQ, certifying
that COMPAQ has the right to receive the Deposit, ("Notice") the ESCROW AGENT
shall, subject to Paragraph IV B below, deliver the Deposit to COMPAQ.
B. At the time of delivery of Notice to ESCROW AGENT, COMPAQ shall deliver a
duplicate copy of such notice to LICENSOR
(i) ESCROW AGENT shall, within five (5) days of receipt of Notice form
COMPAQ, send notice via certified mail or commercial express mail
service to LICENSOR that COMPAQ has demanded release of the Deposit and
shall include a photocopy of the Notice and other relevant items
delivered to ESCROW AGENT by COMPAQ. COMPAQ shall also make reasonable
efforts, over the 30-day period after Notice is sent, to contact, by
telephone, the individual at LICENSOR's place of business to whom the
Notice is sent. ESCROW AGENT shall, upon the expiration of 30 days from
the date the copy of the Notice was sent by ESCROW AGENT to LICENSOR,
make delivery of Deposit to COMPAQ unless the ESCROW AGENT shall have
received either a written withdrawal of the demand Notice signed by an
authorized representative of COMPAQ or such delivery in prohibited by
an order issued by a court of competent jurisdiction and served on
Escrow Agreement.
C. The ESCROW AGENT's duties hereunder may be altered, amended, modified or
revoked only by a writing signed by officers of both Parties.
D. The ESCROW AGENT shall be obligated only for the performance of such duties
as are specifically set forth herein and may rely and shall be protected in
relying upon any instrument reasonably believed by the ESCROW AGENT to be
genuine and to have been signed or
-37-
39
presented by the proper party or parties. The ESCROW AGENT shall not be
personally liable for any act the ESCROW AGENT may do or omit to do hereunder
while acting in good faith and in the exercise of its own good judgment.
E. The ESCROW AGENT is hereby expressly authorized to comply with and obey
orders, judgments or decrees of any court and shall not be liable to any of the
parties hereto or to any other person, form or corporation by reason of such
compliance, notwithstanding any such order, judgment or decree being
subsequently reversed, modified, annulled, set aside, vacated or found to have
been entered without jurisdiction.
F. The responsibilities of the ESCROW AGENT hereunder shall terminate if the
ESCROW AGENT shall resign by written notice to LICENSOR and COMPAQ. In the event
of any such termination, LICENSOR shall promptly appoint a successor ESCROW
AGENT, subject to the approval of COMPAQ which approval will not be unreasonably
withheld.
G. It is understood and agreed that should any dispute arise with respect to the
delivery and/or ownership or right of possession of any part of the Deposit held
by the ESCROW AGENT hereunder, the ESCROW AGENT is authorized and directed to
retain the Deposit in its possession without liability to anyone until such
dispute shall have been settled either by mutual written agreement as provided
above or by final order, decree or judgment by a court of competent jurisdiction
after the time for appearance has expired and no appeal has been perfected, but
the ESCROW AGENT shall be under no duty whatsoever to institute or defend any
such proceedings.
V. NOTICES
Notices required or permitted to be given under this Agreement shall be
in writing, and sent by prepaid registered or certified mail, return receipt
requested, to the addresses and individuals listed in the paragraph entitled
"Notices" in the License Agreement. All such notices if properly addressed shall
be effective when received.
VI. ASSIGNMENT
Neither Party shall assign the Agreement or any rights or obligations
under it except in accordance with the License Agreement.
VII. AGREEMENT SUPPLEMENTARY TO THE LICENSE AGREEMENT
LICENSOR acknowledges that this Escrow Agreement is an "agreement
supplementary to" the License Agreement as provided in Section 365(n) of Title
11, United States Code ("Bankruptcy Code"). LICENSOR acknowledges that if as a
debtor-in-possession or a trustee-in-bankruptcy (collectively "Trustee") in a
case under the Bankruptcy Code rejects the License Agreement or this Escrow
Agreement, COMPAQ may elect to retain its rights under the License Agreement and
this Escrow Agreement as provided in Section 365(n) of the Bankruptcy Code.
-38-
40
After the commencement of a case under the Bankruptcy Code by or against
LICENSOR and unless and until the License Agreement is rejected, Trustee shall,
upon written request of COMPAQ to the Trustee, (a) not interfere with the rights
of COMPAQ as provided in the License Agreement and this Escrow Agreement,
including the right to obtain the escrowed materials form the ESCROW AGENT and
(b) provide the escrowed materials to COMPAQ. If the Trustee rejects the License
Agreement or this Escrow Agreement and COMPAQ elects to retain its rights, upon
written request of COMPAQ to Trustee, Trustee shall provide the escrowed
materials to COMPAQ.
VIII. GENERAL
A. This Agreement and the License Agreement are the complete
understanding between the parties on this subject matter and they supersede all
prior discussions or agreements on this subject between them, and may not be
modified except by a writing signed by authorized representatives of both
parties. If either party fails to enforce any term, such failure shall not
prevent enforcement on any other occasion.
B. This Agreement shall be binding upon and Inure to the benefit of the
parties hereto, and their respective successors and assigns, and shall terminate
upon termination of the License Agreement.
C. All rights and remedies of the parties whether conferred by this or
by any other instrument or by law, shall be cumulative and may be exercised
singularly or concurrently. If any provision of this Agreement is held invalid
by any law or regulation of any government of by the final determination of any
court of competent jurisdiction, such invalidity shall not effect the
enforceability of any other provisions not held invalid. This Agreement and the
rights and obligations of the parties to it shall be governed by the laws of the
State of California.
IN WITNESS WHEREOF, the parties have caused this instrument to be duly executed
as of the date last set forth below.
Compaq Computer Corporation Visioneer Communications, Inc.
By:___________________________ By:__________________________
Name: ________________________ Name:________________________
Title:________________________ Title: ______________________
Date:_________________________ Date:________________________
-39-
41
DATA SECURITIES INTERNATIONAL
By: __________________________ Name: ______________________
Title: _______________________ Date: ______________________
-40-