Partnership License Agreement [Addendum] - Lindows Inc. and Seagate Technology LLC
ADDENDUM TO PARTNERSHIP LICENSE AGREEMENT
This Addendum to Partnership License Agreement ("Addendum") is entered into this
15th day of April 2004 (the "Effective Date"), by and between Lindows, Inc., a
Delaware corporation ("Lindows") and Seagate Technology LLC, a Delaware limited
liability company ("Licensee").
WHEREAS, Lindows and Licensee previously entered into a Partnership License
Agreement on or about September 21, 2003 (the "Agreement"); and
WHEREAS, Lindows desires to grant to Licensee and Licensee desires to receive
from Lindows, a license to pre-install LinSpireEspanol (as defined hereinafter)
on certain Licensee Products (as defined in the Agreement), for purposes of
making Composite Products (as defined hereinafter), and for Licensee to
distribute such Composite Products pursuant to the terms and conditions of this
Addendum and the Agreement.
NOW, THEREFORE, in consideration of the foregoing, and in reliance on the mutual
agreements contained herein, the parties agree as follows:
1. DEFINITIONS: All capitalized terms in this Addendum shall have the same
meaning as in the Agreement, unless otherwise defined in this Addendum.
1.1 "Composite Products" shall mean Licensee Products upon which
Licensee has installed LinSpireEspanol.
1.2 "Gold Master" shall mean a master disk image of
LinSpireEspanol as made available for delivery to Licensee via electronic
download at the Builder website http://builder.lindows.com or any successor
website thereto or on CD-ROM or other media.
1.3 "LinSpireEspanol" shall mean certain computer programs
including LinSpireEspanol and related documentation and interface specifications
developed,
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owned, licensed, otherwise controlled, and/or distributed by Lindows, as more
specifically set forth at the website
http://www.lindows.com/lindows_products.php or any successor website thereto,
and any Updates to the foregoing computer programs and related documentation and
interface specifications.
1.4 "Licensed Term" shall mean six (6) months from the Effective
Date of this Addendum or until the termination or expiration of the Agreement,
whichever is earlier.
1.5 "Licensed Territory" shall mean the country of Mexico, and all
of the countries of the Caribbean, Central America, and South America.
1.6 "Roll-Out Date" shall mean the date in which Lindows first
makes LinSpireEspanol available for sale to the public.
2. SURVIVAL OF TERMS: Unless otherwise stated in this Addendum, all terms
and conditions of the Agreement shall be in full force and effect. The terms and
conditions of the Agreement shall prevail in the event of any discrepancy or
conflict between this Addendum and the Agreement, unless otherwise agreed to in
a document signed by each of the parties hereto.
3. LICENSE GRANT:
3.1 GRANT: Subject to the restrictions in Section 3.2 and the
other terms and conditions in this Addendum and the Agreement, and only during
the Licensed Term, Lindows hereby grants to Licensee a nontransferable,
nonsublicensable (except as expressly set forth in the Agreement), limited right
and license only in the Licensed Territory solely to:
(a) Use the Gold Master to install one (1) copy of
LinSpireEspanol in executable form only on each unit
of the Licensee Products to create Composite
Products;
(b) Distribute such copy of LinSpireEspanol only in
executable form and only as installed on and an
integrated part of Composite Products directly or
through a Reseller to End Users for each End User to
install a Composite Product as part of that End
User's Computer and access and use such copy of
LinSpireEspanol installed on such Composite Product
via the Composite Product and that End User's
Computer;
(c) Distribute such copy of LinSpireEspanol only in
executable form and only as installed on and an
integrated part of Composite Products directly or
through a Reseller to System Builders for each System
Builder to install such Composite Products in its
Computers and distribute such copy of LinSpireEspanol
only as installed on and an integrated part of such
Composite Product
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installed in such Computer directly or through a
Reseller to an End User for an End User to access and
use such copy of LinSpireEspanol via the Composite
Product and such Computer;
(d) Use the Gold Master and LinSpireEspanol to provide
reasonable technical support for Composite Products
to Resellers, System Builders and End Users and, to
the extent necessary to provide such technical
support to End Users only, to distribute a single
copy of LinSpireEspanol on a CD-ROM to an End User
for such End User to re-install LinSpireEspanol on
such End User's Composite Product.
3.2 EXCLUSIVITY: All licenses granted herein are non-exclusive and
Lindows may grant licenses to third parties who may compete with Licensee, in
connection with the distribution (or other uses licensed in this Addendum) of
the Gold Master and LinSpireEspanol, except that, for a period of one hundred
twenty-seven (127) days from the Roll-Out Date, Licensee shall be Lindows'
exclusive partner licensed to pre-install or bundle LinSpireEspanol to create a
composite product, and for a period of one hundred twenty-seven (127) days from
the Roll-Out Date, Licensee shall have the exclusive right to license
LinSpireEspanol to End Users and Resellers in the Licensed Territory, only as an
installed component to the Composite Products. Lindows reserves the right to
license LinSpireEspanol directly to Resellers and/or End Users in the Licensed
Territory as a stand-alone product.
4. PAYMENT: During the Licensed Term, Licensee agrees to purchase a
guaranteed minimum quantity of *** licenses of LinSpireEspanol (the "Guaranteed
Minimum Quantity"). Licensee shall pay Lindows *** for each license of
LinSpireEspanol that Licensee orders from Lindows. The total price paid for the
Guaranteed Minimum Quantity during the Licensed Term shall be *** (the "Minimum
Guaranteed Amount"), which shall be fully earned and nonrefundable. Licensee
shall pay Lindows *** for each license of LinSpireEspanol purchased beyond the
Guaranteed Minimum Quantity. Licensee shall provide Lindows, on a monthly basis,
sales, shipment, inventory, and other written or electronic reports relating to
Licensee's activities under this Addendum during the prior month ("P.O.S.
Reports"). All payments made by Licensee to Lindows shall be made within thirty
(30) days from the date Lindows receives Licensee's P.O.S. Reports. In the event
that Licensee fails to make payment of the amounts due to Lindows thirty (30)
days from the date Lindows receives Licensee's P.O.S. Reports, Lindows shall
notify Licensee that Licensee is in breach of this Section 4 pursuant to the
Notice provision in Section 16 of the Agreement, and Licensee shall have thirty
(30) days from the date Licensee receives such notice to cure such breach, and
Lindows shall charge Licensee a *** late fee for any such amount due to Lindows
(the "Late Fee"). In addition to the Late Fee, the past due amount shall collect
interest at (***) per annum. If, after thirty (30) days from the date Licensee
receives notice of such breach, Licensee has not paid Lindows the amounts due,
plus the Late Fee and interest, Lindows shall, at its sole and absolute
discretion, elect to terminate this Addendum, upon which the Guaranteed
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Minimum Amount, in its entirety, plus the Late Fee and interest, shall
immediately become due and payable to Lindows, and Licensee shall no longer be
entitled to any of the rights granted in Section 3 above. Upon expiration of the
Licensed Term, the Minimum Guaranteed Amount, in its entirety, plus any other
amounts due to Lindows pursuant to this Section 4, shall immediately become due
and payable to Lindows.
5. RESELLERS AND SYSTEM BUILDERS: Licensee shall use its best efforts to
locate and identify Resellers and Systems Builders that will resell and
distribute the Composite Products in the Licensed Territory in a manner
consistent with the terms and conditions of this Addendum and the Agreement.
Lindows shall use its best efforts to drive customer demand to such Resellers
and Systems Builders for product fulfillment.
6. PROMOTION: Licensee shall actively advertise and promote
LinSpireEspanol and the Composite Products in the Licensed Territory in a
commercially reasonable manner. Licensee shall list LinSpireEspanol in its
marketing materials and on its website, and shall transmit LinSpireEspanol
information and promotional materials to End Users in the Licensed Territory in
its ordinary course of business and as reasonably requested by Lindows from time
to time.
7. ADVERTISING: Licensee shall provide samples of its advertising copy and
sales literature to Lindows upon its request. Lindows reserves the right to
review and approve at its sole discretion all uses of Lindows' trademarks,
service marks, or trade names in Licensee's advertising and promotion of
LinSpireEspanol, prior to Licensee's use thereof. Such approval will not limit
Licensee's obligation to comply with all applicable laws in the Licensed
Territory and shall not be deemed an endorsement or approval by Lindows of any
advertising content or use by Lindows. At its sole discretion, Lindows shall
assist Licensee in developing advertisements for LinSpireEspanol, including,
without limitation, presenting Licensee with examples of marketing and
advertising literature within the Licensed Territory.
8. LINDOWS INDEMNIFICATION: Lindows shall defend at its sole cost any
claim or proceeding brought by a third party against Licensee, its officers,
directors, agents, and employees ("Licensee Indemnified Parties"), shall have
the right at its option and sole cost to settle such claim or action, and shall
pay any final award of damages issued against the Licensee Indemnified Parties
by a court of competent jurisdiction, to the extent such claim or proceeding is
based on a claim that the Licensee Indemnified Parties' authorized use
sublicense or distribution of LinSpireEspanol directly infringes or
misappropriates a third party Proprietary Right (a "Licensee Claim"), provided
that: (a) upon becoming aware of such Licensee Claim, the Licensee Indemnified
Parties promptly notify Lindows.com in writing of the Licensee Claim; (b)
Lindows shall have exclusive control of the defense and/or settlement of any
action to which the Licensee Claim relates; and (c) the License Indemnified
Parties cooperate with Lindows in every reasonable way to facilitate such
defense or settlement. Lindows shall not settle any claim without the Licensee
Indemnified Parties' prior written consent (which shall not be unreasonable
withheld, conditioned or delayed). Notwithstanding any of the foregoing, the
Licensee Indemnified Parties shall have the right, in their absolute discretion
and at
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their sole cost, to employ attorneys of their own choice and to institute or
defend any such Licensee Claim. Lindows' obligations under this Section 8 shall
not apply to the extent any Licensee Claim arises from (1) any modifications
made by the Licensee Indemnified Parties or any third party to LinSpireEspanol
as and in the form delivered by Lindows to Licensee under this Addendum, (2) the
Licensee Indemnified Parties' or a third party's failure to use LinSpireEspanol
in accordance with the provisions of this Addendum, and/or (3) the combination
or use of LinSpireEspanol, or any portion thereof with software, hardware or
materials not provided by Lindows. Lindows shall have no liability for any use
of LinSpireEspanol other than as expressly set forth in this Addendum and the
foregoing states Lindows' sole indemnification obligations and entire liability
to Licensee with respect thereto.
9. THREATENED INFRINGEMENT: If LinSpireEspanol becomes subject to a
Licensee Claim relating to Proprietary Rights or in the event that Lindows
wishes to minimize its potential liability hereunder, then Lindows may, at
Lindows' option and at no expense to Licensee, (i) obtain for Licensee the right
to continue to exercise the license granted; (ii) substitute a functionally
equivalent non-infringing software; or (iii) modify LinSpireEspanol to make it
non-infringing but remaining functionally equivalent.
10. LICENSEE INDEMNIFICATION: Licensee shall defend at its sole cost any
claim or proceeding brought by a third party against Lindows, its officers,
directors, agents and employees ("Lindows Indemnified Parties"), shall have the
right at its option and sole cost to settle such claim or action, and shall pay
any final award of damages issued against the Lindows Indemnified Parties by a
court of competent jurisdiction, to the extent that such claim or proceeding
arises out of the Composite Product (except to the extent that Lindows is
required to indemnify the Licensee Indemnified Parties pursuant to Section 8
above) (each, a "Lindows Claim"), provided that: (a) upon becoming aware of such
Lindows Claim, the Lindows Indemnified Parties promptly notify Licensee in
writing of the Lindows Claim; (b) Licensee shall have exclusive control of the
settlement or defense of any action to which the Lindows Claim relates; and (c)
the Lindows Indemnified Parties cooperate with Licensee in every reasonable way
to facilitate such defense or settlement. Licensee shall not settle any claim
without the Lindows Indemnified Parties' prior written consent (which shall not
be unreasonable withheld, conditioned or delayed). Notwithstanding any of the
foregoing, the Lindows Indemnified Parties shall have the right, in their
absolute discretion and at their sole cost, to employ attorneys of their own
choice and to institute or defend any such Lindows Claim.
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IN WITNESS WHEREOF, the parties have executed this Addendum by their duly
authorized representatives on the date first written above.
"Lindows" "Licensee"
LINDOWS, INC. SEAGATE TECHNOLOGY LLC
By: /s/ Kevin Carmony By: /s/ William L. Hudson
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Name: Kevin Carmony Name: William L. Hudson
Title: Pres. & COO Title: Executive Vice President,
4-15-04 General Counsel & Secretary
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