Intergraph Corp. Contracts
Sample Business Contracts
Agreement to Resolve Patent Infringement Claims - International Business Machines Corp. and Intergraph Corp.
Agreement to Resolve Patent Infringement Claims
This Agreement to Resolve Patent Infringement Claims (hereinafter
"Agreement"), shall be effective January 30, 2003 by and between
International Business Machines Corporation ("IBM") and Intergraph
Corporation, Intergraph Properties Company, Inc., Intergraph Software
Technologies Company Inc. and Intergraph Hardware Technologies Inc.
(cumulatively "Intergraph").
WITNESSETH:
Whereas, Intergraph previously designed, developed, and manufactured
computer hardware products; and
Whereas, IBM currently develops, manufactures and markets various
software products, electronic components (including integrated circuits,
circuit boards) and computer systems; and
Whereas, Intergraph and IBM have been engaged in protracted patent
licensing discussions pertaining to certain patented technologies of each
company, but now desire to resolve any and all patent infringement claims
between the parties, as described herein.
Now therefore, in an effort to facilitate the execution of more
definitive agreements reflecting the 1) sale and assignment of certain
patents from IBM to Intergraph, 2) the cross-licensing of other patents, 3)
the tender of a balancing payment from IBM to Intergraph and 4) the
development of cohesive business relationships between the parties, the
parties agree as follows:
A. Patent Cross-License
In consideration of each party's performance hereunder, the parties
are entering, concurrently with this Agreement, into a definitive patent
cross-license agreement (the Cross-license). The Cross-license reflects the
following terms and provisions:
1. A balancing payment of $10 million dollars, payable by IBM to
Intergraph. That said balancing payment reflects the paid-up net present
value of the royalty otherwise payable annually over the remaining term
of Intergraph's last to expire Clipper patents.
2. That the Cross-license shall not grant any implied license or immunity
(either directly or by implication, estoppel or otherwise) to any third
parties not otherwise expressly licensed under the Cross-license.
3. That the Cross-license shall not grant a license for products that are
produced by IBM or Intergraph as manufacturer on a contract basis as a
"foundry" for the manufacture of OEM products, which merely "pass
through" the manufacturer for resale by an OEM, except as expressly
licensed under the Cross-license.
4. That nothing in this Agreement shall be construed or considered to
create any right of sublicense, implied right of license to any third
party, or to extend any license other than to the parties to this
Agreement, or construed or considered to create any right to either
party for "foundry" activities, except as expressly provided under the
Cross-license.
5. That the Cross-license may be extended to subsidiaries who elect to
enjoy the benefits and incur the obligations hereunder.
B. Sale of Patents
IBM agrees to execute a recordable patent assignment in substantially
the form, and with substantially the same terms and provision as set forth
in attached Attachment 1, properly documenting the sale and assignment of
all rights, title and interest from IBM to Intergraph Hardware Technologies
Company ("IHTC"), to twenty-five US Patents selected by Intergraph from the
list set forth in Attachment 2, together with all foreign counterparts, a
list of such selected 25 patents to be provided by Intergraph to IBM within
90 days after signing of this Agreement. Further, the parties agree that
such assignment shall expressly convey the right for IHTC to collect past
damages from the infringement of such patents from third parties, other
than those licensed under such patents. IBM agrees to assist and cooperate
with IHTC in the filing of the assignments for the assigned IBM patents,
and the prosecution of any pending applications and/or further continuation
or derivative rights pertaining to the assigned patents.
C. Intergraph Licensing Program Covering US Patents 4899275, 4933835,
5091846, 4860192, and 4884197 (Clipper Patents)
IBM acknowledges that Intergraph intends to seek payment for patent
license agreements from computer system vendors (other than system vendors
reselling a Licensed Product as defined in the Cross-license, purchased
from IBM) under US Patents 4899275, 4933835, 5091846, 4860192, and 4884197
(the Clipper Patents) . Except as relates to court or government orders or
assertions made by Intergraph against IBM customers pertaining to products
or services supplied by IBM, either directly or indirectly, IBM agrees not
to interfere with any third-party licensing activity of Intergraph with
respect to the Clipper Patents, in particular:
1. Not to challenge the validity of the Clipper Patents, nor assist or
request any third party to: (i) contest the legality, validity or
enforceability of any of the Clipper Patents or Intergraph's ownership
of them, (ii) request reexamination, or assist or request any third
party to request reexamination of any of the Clipper Patents, or (iii)
assert patent exhaustion or any other theory by which the covenant not
to sue granted herein extends immunity from suit for infringement of a
Clipper Patent to any third party.
2. Not to bring suit, or assist others in bringing suit to challenge
Intergraph's position on exhaustion or implied license issues as to the
Clipper Patents.
3. Not to assist others with arguments of invalidity, exhaustion or implied
license, or other defenses of any type to the Clipper Patents.
4. Not to bring, assist in bringing or participate in any litigation
asserting that this Agreement or the Cross-license precludes Intergraph
from pursuing license agreements with other computer system vendors for
the Clipper patents, except to the extent of the rights granted pursuant
to this Agreement and the Cross-license.
D. Intergraph and IBM Business Relations
The parties agree to utilize commercially reasonable efforts to identify
common business opportunities, and/or areas for the development of cohesive
business relationships between the parties, from which the parties can
expand business and revenue opportunities for Intergraph and IBM. IBM
agrees to identify appropriate contacts within IBM, whom can work together
in good faith with appropriate representatives of Intergraph's Mapping GIS,
and Public Safety Divisions, to arrange business, teaming, bidding,
reselling, and marketing opportunities between IBM and Intergraph.
E. Releases
The parties further agree that:
1. All actions taken with respect to this Agreement, and/or amounts paid
in accordance herewith, are undertaken in consideration of the
settlement of patent infringement claims, and are nonrefundable, even if
the validity, scope, or enforceability of any Intergraph or IBM patent
is subsequently challenged and deemed to be held invalid, of narrower
scope, or unenforceable.
2. As additional consideration for resolution of all respective patent
infringement claims, but subject to all of the provisions of this
Agreement and the Cross-license, the parties shall release, covenant not
to sue for, acquit and forever discharge the other from any and all
claims or liability for infringement or alleged infringement of any IBM
or Intergraph Licensed Patents (as defined in the Cross-license) with
respect to performance by the other prior to the Effective Date, of
acts, which if performed on or after the Effective Date, would be acts
licensed under the Cross-license.
F. Term
This Agreement shall become effective as of the date set forth above and
shall continue in effect for a period of nine months from the effective
date of this Agreement.
G. Public Announcements
The parties acknowledge that the parties' licensing arrangements may be
material corporate events, and that each party shall have the right to make
an appropriate filing with the SEC disclosing the material provisions of
the parties' licensing terms, redacting terms to the extent permissable.
Further, IBM agrees to cooperate with Intergraph in drafting and
disseminating of a joint press release announcing the parties' licensing
arrangement, subject to the requirements set forth under the Cross-license.
[the remainder of this page has intentionally been left blank]
H. Resolution of Conflicts Between Agreements
In the event of a conflict between the terms of this Agreement and the
Cross-license, the terms of the Cross-license shall control.
Intergraph Corporation International Business Machines Corporation
By /s/ David Vance Lucas By /s/ Gerald Rosenthal
Its Vice President and Its Vice President
General Counsel
Intergraph Properties Company, Inc.
By /s/ David R. Hancock
Its President
Intergraph Software Technologies Company Inc.
By /s/ David R. Hancock
Its President
Intergraph Hardware Technologies Inc.
By /s/ David R. Hancock
Its President
Attachment 1
Agreement Reference Number________________
013003
PATENT ASSIGNMENT AGREEMENT ("Agreement") with an Agreement Date of
January __, 2003, between INTERNATIONAL BUSINESS MACHINES CORPORATION, a
New York corporation ("IBM"), and INTERGRAPH CORPORATION, a Delaware
corporation ("INTERGRAPH").
WHEREAS, IBM has the right to assign the "Assigned Patents" as defined
below, subject to certain reserved rights, and INTERGRAPH desires to
acquire an ownership interest in the Assigned Patents subject to such
reservations;
NOW THEREFORE, in consideration of the premises and mutual covenants
herein contained, as well as the parties' entry into the Agreement to
Resolve Patent Infringement Claims effective as of January 30, 2003, IBM
and INTERGRAPH agree as follows:
Section 1. Definitions
-----------
1.1 "Assigned Patents" shall mean, and be strictly limited to the United
States Letters Patents listed in Exhibit A hereto, and all foreign
counterparts thereof.
1.2 "Effective Date" shall mean January 1, 2003.
1.3 "Subsidiary" shall mean a corporation, company or other entity:
(a) more than fifty percent (50%) of whose outstanding shares or
securities (representing the right to vote for the election of
directors or other managing authority) are, now or hereafter, owned or
controlled, directly or indirectly, by a party hereto, or
(b) which does not have outstanding shares or securities, as may be the
case in a partnership, joint venture or unincorporated association,
but more than fifty percent (50%) of whose ownership interest
representing the right to make the decisions for such corporation,
company or other entity is now or hereafter, owned or controlled,
directly or indirectly, by a party hereto, but such corporation,
company or other entity shall be deemed to be a Subsidiary only so
long as such ownership or control exists.
Section 2. Assignment and Release
----------------------
2.1 Effective upon the Effective Date, and subject to all rights
granted to others thereunder prior to the Effective Date, and subject to
IBM's reservation of rights set forth in Section 3, IBM hereby transfers
and assigns to INTERGRAPH all of IBM's right, title and interest
throughout the world in and to the Assigned Patents.
2.2 INTERGRAPH shall be solely responsible for all actions and all costs
whatsoever associated with the perfection of rights, title, and interest in
an to the Assigned Patents, provided however, that upon INTERGRAPH's
----------------
written request, IBM shall deliver copies of any and all papers, shall
execute all documents and instruments, and shall do all lawful acts, in
each case as may be necessary and at INTERGRAPH's expense, to perfect
INTERGRAPH's rights, title, and interest in and to the Assigned Patents.
2.3 INTERGRAPH shall be solely responsible for all actions and all costs
whatsoever arising after the Effective Date and associated with prosecuting
and maintaining the enforceability of the Assigned Patents.
2.4 No license, immunity, ownership interest, or other right is granted
under this Agreement, either directly or by implication, estoppel, or
otherwise, except with respect to the Assigned Patents as expressly set
forth herein.
Section 3. Reserved Rights
---------------
3.1 IBM hereby reserves and retains, for the benefit of itself and its
Subsidiaries, successors, and assigns, under the Assigned Patents, an
irrevocable, nonexclusive, worldwide, fully paid-up right and license to
make, have made, use, have used, import, license, offer to sell, sell,
lease, and otherwise transfer any product or service, and to authorize
others to do any of the foregoing on behalf of IBM and its Subsidiaries.
Such reserved license shall include the right to grant fully paid up
sublicenses to:
(a) entities which are now or hereafter, Subsidiaries of IBM;
(b) any third party having a right, as of the Effective Date, to obtain a
license from IBM under the Assigned Patents;
(c) any third party:
(i) renewing any written agreement with IBM in existence on the
Effective Date; or
(ii) having a written agreement with IBM in existence on the
Effective Date and entering into a new agreement with IBM;
and where, in the case of either (i) or (ii), said existing written
agreement grants to such third party any right under the Assigned
Patents, provided that any sublicense hereafter granted by IBM to such
third party in accordance with this Subsection (c) may extend the
duration of, but shall not expand the scope of, any existing rights
set forth in said existing written agreement.
The term of such reserved license shall be from the Effective Date until
the expiration of the last to expire of the Assigned Patents.
3.2 IBM hereby reserves and retains, for the benefit of itself and its
Subsidiaries, successors, and assigns, any and all rights to past, present,
and future royalties and other consideration in exchange for rights with
respect to the Assigned Patents, arising out of or accruing under
agreements between IBM (and/or its Subsidiaries) and third parties existing
prior to or on the Effective Date, together with any and all such royalties
and other consideration arising out of or accruing under any license or
sublicense granted by IBM pursuant to Section 3.1.
Section 4. Communication
-------------
4.1 Notices and other communications shall be sent by facsimile or by
registered or certified mail to the following address and shall be
effective upon mailing:
For IBM: For INTERGRAPH:
Director of Licensing Intergraph Hardware
IBM Corporation Technologies Company Inc.
North Castle Drive, MD-NC119 2325B Renaissance Drive
Armonk, New York 10504-1785 Suite 16
Las Vegas, NV 89119; and
Facsimile: 914-765-4380
4.2 An Agreement Reference Number will be assigned to this Agreement upon
execution. This number should be included in all communications, including
letters, faxes and e-mail messages.
Section 5. Miscellaneous
-------------
5.1 Both parties agree not to use or refer to this Agreement or any of its
provisions in any promotional activity. Furthermore, until January 1, 2008,
each party agrees not to disclose the terms and conditions of this
Agreement to any third party (other than its Subsidiaries) without the
prior written consent of the other party. This obligation is subject to
the following exceptions:
(a) disclosure is permissible if required by government or court order,
provided the party required to disclose first gives the other prior
written notice to enable it to seek a protective order;
(b) disclosure is permissible if otherwise required by law;
(c) disclosure is permissible if required to enforce rights under this
Agreement;
(d) each party may use similar terms and conditions in other agreements;
and
(e) each party may disclose this Agreement or its contents to the extent
reasonably necessary, on a confidential basis, to its accountants,
attorneys, financial advisors, potential acquirers on a need to know
basis, and its present or future providers of financing or venture
capital.
The nondisclosure obligation shall be satisfied by a party if it treats
this Agreement in the same manner as it treats its other similar contracts.
5.2 IBM shall not have any obligation hereunder to institute any action or
suit against third parties for infringement of any Assigned Patents or to
defend any action or suit brought by a third party which challenges or
concerns the validity of any Assigned Patents. IBM shall not have any
obligation hereunder to cooperate with or otherwise assist INTERGRAPH with
respect to any action or suit against third parties for infringement of any
Assigned Patent.
5.3 IBM represents and warrants that it has the full right and power to
assign its rights in the Assigned Patents as set forth in Section 2. IBM
represents and warrants that as of the Effective Date it continues to own
all of its right, title and interest throughout the world in and to the
Assigned Patents, subject to all rights granted to others thereunder prior
to the Effective Date. IBM MAKES NO REPRESENTATION OR WARRANTY WITH
RESPECT TO ANY INFRINGEMENT OF PATENTS OR OTHER INTELLECTUAL PROPERTY
RIGHTS OF THIRD PARTIES. IBM MAKES NO REPRESENTATION OR WARRANTY REGARDING
THE VALIDITY OR ENFORCEABILITY OF THE ASSIGNED PATENTS. IBM MAKES NO OTHER
REPRESENTATIONS, WARRANTIES, OR COVENANTS, EXPRESS OR IMPLIED, NOR SHALL
IBM HAVE ANY LIABILITY, IN RESPECT OF ANY INFRINGEMENT OF PATENT OR OTHER
RIGHTS OF THIRD PARTIES DUE TO INTERGRAPH'S ACTS OR OMISSIONS WITH RESPECT
TO THE RIGHTS HEREIN GRANTED.
5.4 This Agreement shall not be binding upon the parties until it has been
signed hereinbelow by or on behalf of each party. No amendment or
modification hereof shall be valid or binding upon the parties unless made
in writing and signed as aforesaid.
5.5 If any section of this Agreement is found by competent authority to be
invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such section in every other
respect and the remainder of this Agreement shall continue in effect so
long as the Agreement still expresses the intent of the parties. However,
if the intent of the parties cannot be preserved, this Agreement shall be
either renegotiated or terminated.
5.6 This Agreement shall be construed, and the legal relations between the
parties hereto shall be determined, in accordance with the law of the State
of New York, USA, as such law applies to contracts signed and fully
performed in such State.
5.7 The headings of sections are inserted for convenience of reference
only and are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
This Agreement and its Exhibit A embodies the entire understanding of
the parties with respect to the Assigned Patents, and replaces any prior
oral or written communications between them.
Agreed to: Agreed to:
INTERGRAPH CORPORATION INTERNATIONAL BUSINESS
MACHINES CORPORATION
By:_____________________ By:_____________________
Name: __________________ Gerald Rosenthal
Title: _________________ Vice President
Date:___________________ Date:___________________
EXHIBIT A
ASSIGNED PATENTS
----------------
Patent (or Date Issued or Inventors
Patent Date Patent
Application) Application
Number Filed
END OF EXHIBIT A
Attachment 2
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