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Exhibit 10.17
[Certain portions of this Exhibit have been omitted based upon a
request for confidential treatment pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934. Omitted portions: Sections 2.7 (in part), 2.9 (in part),
7.2 (in its entirety), 8 (in its entirety), 9.2 (in part), 11.1 (in its
entirety), 16 (in part), and 23.1 (in part). Omitted portions have been filed
separately with the Securities and Exchange Commission.]
COOPERATION AGREEMENT
REGARDING TELEMATICS
This Agreement is made and entered into on the last day set out below
by and between
Unwire AB (publ), 556522-7617, Box 1449, 171 28 Solna, Sweden,
(hereinafter referred to as "Unwire")
AND
Ericsson Business Consulting (Malaysia) Sdn Bhd, 474845-K, Wisma
Ericsson Jalan SS 7/19, Kelana Jana, 47301 Petaling Jaya, Selangor
Darul Ehsan, Malaysia, (hereinafter referred to as "Ericsson").
1. DEFINITIONS
For the purpose of this Agreement, the following words and
terms shall have the meanings set forth below:
1.1 The term "the Agreement" shall mean this agreement including
its appendices.
1.2 The term "Know-how" shall mean knowledge, experience, data,
technology, designs, techniques, drawings, software, and other
information and knowledge.
1.3 The term "Products" shall mean Unwire's telematics products
set forth in ENCLOSURE 1.
1.4 The term "Program" shall mean the software developed by Unwire
and installed by Unwire in the Products.
1.5 The term "Shipment" shall mean that the Products have been
delivered by Unwire EXW at the place set our in Unwire's
confirmation of Ericsson's order (Incoterms 1990).
1.6 The term "Territory" shall mean Malaysia.
2. COOPERATION
2.1 Subject to the terms and conditions of this Agreement, the
parties shall on a non exclusive basis cooperate regarding
telematics, i.e., products that enable telecommunication
between devices. To begin with, the parties' cooperation is
limited to Malaysia. However, the parties intend to extend the
Territory into
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include other countries in the Asian Pacific region. Whenever
new countries are to be covered by the Agreement, the parties
shall in writing confirm that the Territory also includes such
countries.
2.2 The basis of the parties' cooperation is that Unwire develops
and sells the Products, and that Ericsson desires to purchase
the Products for resale as a part of complete solutions, and
also desires to establish indirect channels to resell such
solutions through third party resellers.
2.3 In order to be able to resell the Products as a part of
complete solutions, Ericsson shall maintain sufficient
competence to be able to integrate the Products into complete
solutions.
2.4 The parties also intend to jointly and independently develop
applications that can be downloaded into the Products.
2.5 In addition to the support obligations for defective Products
set forth in this Agreement, the parties shall jointly develop
a concept including an undertaking to provide quality and
support to customers. Under this concept, Ericsson shall be
responsible for first-line support to customers, while Unwire
shall be responsible for back-up support to Ericsson. The
parties shall jointly agree upon the terms and conditions of
such a support agreement, and the parties shall jointly decide
how the revenues from the customers shall be shared between
the parties.
2.6 Either party shall without delay inform the other party of any
companies or persons with whom it cooperates regarding
telematics within the Territory and of any programs or other
applications developed for the Products.
2.7 Unwire has developed an application library, ENCLOSURE 2,
including unique programs which can be installed in the
Products. [Omitted based upon a request for confidential
treatment pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934. The omitted portion has been filed
separately with the Securities and Exchange Commission.]
2.8 Upon request by either party, the parties shall meet to
discuss their cooperation under this Agreement. Cooperation
results that are achieved shall be documented in the minutes
from meetings, which shall be prepared jointly by the parties.
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2.9 For the cooperation under this Agreement, Ericsson shall make
the following persons available:
[Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities and Exchange Act
of 1934. The omitted portion has been filed separately with
the Securities and Exchange Commission.]
For the cooperation under this Agreement, Unwire shall make
the following persons available:
[Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of
1934. The omitted portion has been filed separately with the
Securities and Exchange Commission.]
Replacement of may only occur with the permission of the other
Party, whose permission sball not be unreasonably withheld.
3. GRANT
3.1 Subject to the terms and conditions of this Agreement, Unwire
hereby grants to Ericsson the non-exclusive right to market
and sell the Products in the Territory. Unwire reserves the
right to market and sell the Products directly to customers
within the Territory. Unwire shall pay no commission or other
compensation to Ericsson for such direct sales. If Ericsson
can show that it has solicited a customer before Unwire or
before any other distributor appointed by Unwire, Unwire is
responsible for ensuring that Ericsson alone may market and
sell the Products to such customer.
3.2 Subject to the terms and conditions of this Agreement, Unwire
grants to Ericsson a non-transferable and non-exclusive
license to (either directly or indirectly through any of its
partners) develop by itself or jointly with Unwire new
software for the Products and to market and sell such software
only as an integral part of the Products.
3.3 Subject to the terms and conditions of this Agreement,
Ericsson grants to Unwire a non-transferrable and
non-exclusive right, unlimited in time, to freely manufacture,
market and sub-license any software developed by Ericsson for
the Products and any software developed jointly by the parties
for the Products. Ericsson shall supply to Unwire the source
code and other documentation relating to such software
developed by Ericsson as soon as it has been developed.
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3.4 Subsection 3.3 above shall not apply in the event a third
party still has intellectual property rights to the new
software for the Products. In such cases, Ericsson shall
promptly notify Unwire and the parties shall make their best
efforts to conclude a license agreement on terms and
conditions which reflect the particular circumstances of the
individual case.
4. NEW PRODUCTS
4.1 New products which are marketed by Unwire, shall be covered by
the Agreement after written agreement by the parties.
5. LEGAL RELATIONSHIP OF THE PARTIES
5.1 Ericsson shall buy the Products as an independent contractor
and shall sell the Products in its own name, on its own
account and at its own risk. Ericsson may not in any respect
represent Unwire or enter into any agreement or other
commitment on Unwire's behalf.
6. ORDERS AND DELIVERIES
6.1 Ericsson's orders shall be made in writing. After receipt of
an order, Unwire shall in writing within five (5) days either
confirm the order or inform Ericsson that Unwire cannot accept
the order.
6.2 Shipment of Products shall be made within the time period set
forth in Unwire's confirmation of Ericsson's order.
6.3 If the delivery of the Products is delayed and such delay is
due to Unwire, Ericsson shall be entitled to liquidated
damages calculated for each full week of the duration of the
delay at the rate of half a (0.5) percent of the price for the
delayed Products. However, the liquidated damages may not
exceed a total of five (5) percent of the price for the
delayed Products.
6.4 Unwire's liability or fault due to a delayed Shipment is to
the abovementioned liquidated damages and Ericsson cannot make
any other claims against Unwire on the grounds of a delayed
Shipment. This does not, however, limit Ericsson's right to
terminate the Agreement in accordance with section 25 below.
7. ERICSSON'S SALES EFFORTS
7.1 Ericsson shall make its best efforts to market and sell the
Products within all markets of the Territory.
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7.2 [Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of
1934. The omitted portion has been filed separately with the
Securities and Exchange Commission.]
7.3 The remedy provided for above may be invoked against Ericsson
only if Unwire gives Ericsson notice thereof no later than 30
days after Unwire has been informed of such non-fulfillment.
8. PRICE AND TERMS OF PAYMENT
8.1 [Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of
1934. The omitted portion has been filed separately with the
Securities and Exchange Commission.]
8.2 [Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of
1934. The omitted portion has been filed separately with the
Securities and Exchange Commission.]
8.3 [Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of
1934. The omitted portion has been filed separately with the
Securities and Exchange Commission.]
9. WARRANTY
9.1 Unwire undertakes and warrants that the Products shall at all
times be free from defects in design, materials and
workmanship, provided
a) that the Products have not been subject to misuse or
neglect by Ericsson or its customers or
b) that the Products have not been altered or repaired
other than by Unwire or with its approval.
9.2 Unwire shall, at its own option and cost, repair or replace
any Products found to be faulty by reason of defective design,
materials or workmanship for a warranty period of
[Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of
1934. The omitted portion has been filed separately with the
Securities and Exchange Commission.] Such replacement or
repair of Products shall be made by Unwire as soon as Ericsson
has notified
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[Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of
1934. The omitted portion has been filed separately with the
Securities and Exchange Commission.]
9.3 The warranty for repaired or replaced Products shall be
treated as set forth in subsections 9.2 and 9.3.
9.4 Unwire's liability or fault due to defective Products is
limited to that stipulated above and Ericsson cannot make any
other claims against Unwire on the grounds of Products being
defective. This does not, however, limit Ericsson's right to
terminate the Agreement in accordance with section 25 below.
10. RETURNED PRODUCTS
10.1 Products rejected under a warranty shall at Unwire's option be
delivered to Unwire at its expense and risk.
10.2 All returned Products shall be accompanied by a report issued
by Ericsson stating the reason for the return of the Products.
10.3 Unwire shall reimburse all payments made by Ericsson for
Products returned to Unwire, in accordance with the preceding
section, within thirty (30) days from the date that Unwire has
received the returned Products.
11. DISCONTINUANCE OF SUPPLY
11.1 [Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of
1934. The omitted portion has been filed separately with the
Securities and Exchange Commission.]
12. SUBDISTRIBUTORS AND PARTNERS
12.1 Ericsson may freely appoint subdistributors, agents or other
intermediaries for the marketing and sales of the Products in
the Territory. If Ericsson appoints subdistributors, agents or
other intermediaries, Ericsson shall promptly notify Unwire of
the intermediary's name and cause the intermediary to act in
every respect in conformity with the provisions of this
Agreement. Ericsson is
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responsible for any act by the intermediary provided such act
is carried out with the full knowledge of and/or participation
from Ericsson. Unwire shall have no responsibility in this
request.
12.2 Ericsson shall not allow a partner to develop software in
accordance with section 3.2 above, without Unwire's prior
written consent. Such consent may only be withheld on
objective and qualitative grounds. If Ericsson allows a
partner to develop software in accordance with section 3.2
above, Ericsson shall cause the partner to act in every
respect in conformity with the provisions of this Agreement.
Ericsson is responsible for any act by the partner provided
such act is carried out with the full knowledge of and/or
participation from Ericsson. Unwire shall have no
responsibility in this respect.
13. FORECASTS
13.1 Ericsson shall in November of each year furnish Unwire with a
sales forecast containing Ericsson's intended sales volumes
for the subsequent calendar year. In addition hereto, Ericsson
shall one month before the beginning of every calendar quarter
furnish Unwire with a sales forecast covering the subsequent
calendar quarter. For the avoidance of doubts, the parties
agree that the aforesaid forecasts shall be for planning
purposes only and shall not be binding upon the parties.
14. MARKETING
14.1 Ericsson shall, at its own expense, market the Products and
participate in sales conferences arranged by Unwire and in
fairs and exhibitions of importance to the marketing of the
Products. Unwire shall to a reasonable extent and free of
Charge assist Ericsson at exhibitions and demonstrations of
the Products.
14.2 Unwire shall, to the extent Unwire deems necessary, provide
Ericsson with brochures, catalogs, drawings, samples and other
sales promotion materials concerning the Products. Sales
promotion materials prepared by Ericsson shall be approved by
Unwire before use.
15. SERVICE
15.1 Ericsson shall, at ito own cost, create and maintain a
suitable service organization the Products throughout to
entire Territory. This means that Ericsson shall be
responsible for all contacts with customers and for accepting
all Products returned by customers due to the Products being
defective. When a customer returns a defective Product,
Ericsson shall replace such Product no later than three days
after the customer has returned the Product to Ericsson.
Ericsson undertakes at all
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times to keep in stock at least three (3) percent Of
Ericsson's yearly sales of the Products.
16. TRAINING AND SUPPORT
16.1 [Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of
1934. The omitted portion has been filed separately with the
Securities and Exchange Commission.]
16.2 [Omitted based upon a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of
1934. The omitted portion has been filed separately with the
Securities and Exchange Commission.]
17. CHANGING THE PRODUCTS
17.1 Ericsson shall not remove or change any trademark, trade name,
sign or other mark on any Product or its packaging or make any
alterations in the construction design of any Product.
18. TRADEMARKS AND OTHER INDUSTRIAL PROPERTY RIGHTS
18.1 Ericsson shall use Unwire's trademarks and trade names when
marketing the Products. The right and obligation to such use
is limited to the period of the Agreement. Ericsson shall not
use any other trademark in conjunction with Unwire's
trademarks. Ericsson shall not acquire any rights whatsoever
in Unwire's trademarks.
18.2 Unwire has ownership of and all other rights to the Products,
the Program and any other software developed by Unwire for the
Products, including all copyright and Know-how relating in any
way to the Products, the Program and the new software
developed by Unwire for the Products. Through this Agreement,
Ericsson does not acquire any right whatsoever to Unwire's
copyright, patents, trade secrets or other intellectual
property rights.
18.3 Ericsson has ownership of all other rights to any new software
developed by Ericsson for the Products, including all
copyright and Know-how relating in any way to the new software
developed by Ericsson for the Products. Through this
Agreement, Unwire does not acquire any right whatsoever to
Ericsson's copyright, patents, trade secrets or other
intellectual property rights.
18.4 The parties have joint ownership of and all other rights to
any new software developed jointly by the parties for the
Products, including all copyright and
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Know-how relating in any way to the new software developed
jointly by the parties for the Products.
18.5 Either party shall without delay inform the other party of any
infringement or suspected infringement in the Territory of the
parties' patents or other industrial property rights. Neither
party is, however, obliged to defend its or the other party's
rights.
19. RIGHT TO USE THE PROGRAM
19.1 Subject to the terms and conditions of this Agreement, Unwire
grants to Ericsson a non-transferable and non-exclusive
license within the Territory to grant (either directly or
indirectly through a subdistributor) a non-transferable and
non exclusive license to customers to use the Program when
using the Product.
19.2 Ericsson is only entitled to use the Program in accordance
with the license set forth under section 20.1 above and is
thus, among other things, not allowed to
a) modify, amend, later, revise, enhance or otherwise
change the Program,
b) take any action, such as reverse assembly or reverse
compilation, to derive a source code equivalent to
the Program's,
c) copy, sell, license, sub-license, rent, lend or
otherwise dispose of the Program,
d) make the Program or any portion thereof available to
any third party, and
e) use the Program in a way that would endanger its
quality as a trade secret.
19.3 Ericsson may only grant sub-licenses on terms and conditions
that are compatible with the provisions of this Agreement, and
Ericsson shall be responsible towards Unwire for the
fulfillment by the sub-licensee of such terms and conditions.
Thus, Ericsson shall be responsible for the subdistributors
granting sub-licenses to customers on terms and conditions
that are compatible with the provisions of this Agreement.
19.4 Unwire shall have the right to update (including amending and
modifying) the Program through downloading software by radio.
Customers shall, however, have the right to choose that Unwire
shall not have such right to update the Program. Ericsson
shall make its best efforts to ensure that subdistributors and
customers
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that purchase the Products allow Unwire to update (including
amending and modifying) the Program through downloading
software by radio.
19.5 To the best of Unwire's knowledge, third parties are unable to
update (including amending and modifying) the Program.
20. DOCUMENTS
20.1 Any documentation such as documents, drawings or other data
bearing media and software programs (including information or
drawings stored in or made by software programs) submitted to
Ericsson by Unwire shall rernain Unwire's exclusive property
and shall be returned to Unwire upon request.
21. SECRECY
21.1 The parties agree without any limitation in time not to reveal
to any third party Confidential Information, which a party
obtains from the other Party in accordance with this
Agreement.
21.2 "Confidential Information" refers in this Agreement to any
item of information technical, commercial or of any other
nature - regardless of whether or not such information has
been documented or not, with the exception of
a) information, which is generally known or which
becomes a matter of general knowledge in a manner
other than through the party's breach of the
provisions of this Agreement,
b) information, which the party ran prove that he
possessed before he received it from the other party,
and
c) information, which the party received or will receive
from a third party when the party does not have a
duty of secrecy to such party.
21.3 In cases referred to by c) above, the party is not however
entitled to reveal to third parties that the same information
has been received from the other party pursuant to this
Agreement.
21.4 Both parties agree to ensure that its employees, consultants,
board members and other representatives for the party do not
disclose Confidential Information to third parties. The
parties are thus under a duty to ensure that persons who can
be expected to come into contact with information of a
confidential nature are
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required to deep such information secret to the same extent
that this Agreement requires the parties to do so.
21.5 Ericsson may only use Confidential Information, which has been
supplied by Unwire, to sell the Products and to develop
software for the Products in accordance with this Agreement.
22. ASSIGNMENT OF THE AGREEMENT
22.1 Neither party may wholly or partly assign or pledge its rights
and obligations under the Agreement to any third party except
with the prior written consent of the other party, whose
consent shall not be unreasonably withheld.
23. TERM
23.1 The term of this Agreement commences upon the signature of
both parties and continues until [Omitted based upon a
request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934. The omitted
portion has been filed separately with the Securities and
Exchange Commission.] The Agreement will be renewed for
additional successive renewal periods of one year unless
either party gives written notice, at least six months
prior to the expiration of the preceding period, that the
Agreement shall cease to exist.
24. PREMATURE TERMINATION DUE TO BREACH OF CONTRACT, ETC.
24.1 Without prejudice to any remedy it may have against the other
for breach or non-performance of the Agreement, either party
shall have the right to terminate the Agreement by giving the
other party no less than thirty (30) days notice in writing
a) if the other party should commit or permit a breach
or non-performance of essential importance to the
other party and should fail to remedy such breach
within 10 days after receipt of written notice,
b) if the other party should enter into liquidation,
either voluntary or compulsory, or become insolvent
or enter into composition or corporate reorganization
proceedings or if execution is levied on any goods
and effects of the other party or the other party
should enter into receivership, or
c) if ownership of the other party is materially
changed.
24.2 Notice of termination shall be given without undue delay after
the circumstance constituting the breach was or should have
been known to the aggrieved party.
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25. CONSEQUENCES OF TERMINATION
25.1 At the termination of the Agreement, Unwire may at its option
repurchase all or a part of the stock of Products, which
Ericsson may have at such time, at prices equal to the prices
Ericsson paid when purchasing the Products from Unwire.
Nothing herein contained shall be construed so as to affect
Ericsson's responsibilities and/or ongoing contractual
commitments to their agents, partners, sub-distributors,
intermediaries and/or customers.
25.2 If Unwire chooses not to repurchase the Products in accordance
with the preceding paragraph, Unwire shall complete all orders
received before the termination of the Agreement and Ericsson
is free to dispose of Products in stock after the termination
of the Agreement. Notwithstanding that delivery by Unwire
might be made after the termination of the Agreement, the
provisions of the Agreement shall apply to such deliveries.
26. FORCE MAJEURE
26.1 The parties shall be relieved from liability for a failure to
perform any obligation under the Agreement during such period
and to the extent that the due performance thereof by either
of the parties is prevented by reason of any circumstance
beyond the control of the parties, such as war, warlike
hostilities, mobilization, civil war, fire, flood, changes in
laws and regulations or in the interpretation thereof, acts of
authorities, labor disputes blockades, major accidents or
other circumstances of similar importance or nature. Provided
that if the period of force majeure shall persists for more
than thirty (30) days, either party shall be entitled to
summarily terminate this Agreement by notice in writing to the
other.
26.2 The party desiring to invoke an event of force majeure shall
give immediate notice to the other party of the commencement
and the cessation of such event of force majeure, failing
which the party shall not be discharged from liability for any
non-performance caused by such event of force majeure.
27. LIMITATION LIABILITY
27.1 The parties shall not be liable for any indirect, incidental,
or consequential damages, including, without limitation, any
lost profits, data or income, arising out of or in connection
with this Agreement.
27.2 The parties' liability for damages payable to the other party
shall only cover compensation for direct loss and shall not
exceed a total of fifteen (15) percent of
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the price of the Products so far delivered under the
Agreement. This limitation does not include interest and
liquidated damages.
27.3 The limitation of liability for damages under this section is
not applicable with respect to damages which arise in
connection with a breach of section 19 (Trademarks and other
industrial property rights), section 20 (Right to use the
Program), section 21 (Documents) and section 22 (Secrecy).
28. GOVERNING LAW
28.1 The Agreement shall be construed in accordance with and be
governed by the laws of Sweden.
29. NOTICES AND LANGUAGE
29.1 Any notice, request, consent and other communication to be
given by a party under the Agreement (hereinafter called a
"Notice") shall be in the English language and deemed to be
valid and effective if personally served on the other party or
sent by registered prepaid airmail or by telefax to the
addresses and fax numbers set forth in ENCLOSURE 6.
29.2 A Notice shall be deemed to have been given:
a) in the case of persona service at the time of
service;
b) in the case of prepaid registered mail: at the
latest, seven days after the date of mailing; and
c) in the case of telefax: on the date the telefax is
sent, provided receipt is confirmed by the other
party.
29.3 Changes of address are to be notified as set out in this
provision.
30. HEADINGS
30.1 The division of the Agreement into separate articles and the
insertion of headings shall not affect the interpretation of
the Agreement.
31. AMENDMENTS
31.1 Only those amendments and additions to the Agreement that are
made in writing and signed by the parties are valid.
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32. ENTIRE AGREEMENT
32.1 The Agreement constitutes the entire agreement between the
parties on all issues to which the Agreement relates. The
contents of the Agreement supersede all previous written or
oral commitments and undertakings.
33. SEVERABILITY
33.1 If any provision of the Agreement or part thereof shall to any
extent be or become invalid or unenforceable, the parties
shall agree upon any necessary and reasonable adjustments of
the Agreement in order to secure the vital interests of the
parties and the main objectives prevailing at the time of
execution of the Agreement. Failing an agreement between the
parties on adjustment of the Agreement, such adjustments shall
be made by arbitrators in accordance with the provisions of
the arbitration clause in the Agreement.
34. WAIVER
34.1 No consent or waiver, express or implied, by either party of
any breach or default of the other party in performing its
obligations under the Agreement shall be deemed or construed
to be a consent or waiver of any other breach or default by
the other party of the same or any other obligation hereunder.
Any failure by one party to complain of any act or failure to
act of the other party or to declare that other party in
default shall not constitute a waiver by the first party of
its rights under the Agreement. No waiver of any rights under
the Agreement shall be effective unless in writing and signed
by the party purporting to give the same.
35. ARB1TRATION
35.1 Any dispute, controversy or claim arising out of or in
connection with this contract, or the breach, termination or
invalidity thereof, shall be settled by arbitration in
accordance with the Rules of the Arbitration, Institute of the
Stockholm Chamber of Commerce.
35.2 The place of arbitration shall be Stockholm.
35.3 The language to be used in the arbitral proceedings shall be
English.
36. MISCELLANEOUS
36.1 This Agreement Is conditional upon the approval of Unwire's
board of directors.
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36.2 This Agreement shall be binding upon the successors-in-title
permitted assigns of the respective parties hereto.
36.3 Each party warrants that it has the power and capacity to
enter into this Agreement and has obtained all necessary
approvals to do so.
36.4 This Agreement shall at all times be subject to changes or
modifications to comply with the rules, regulations or orders
of the regulatory authorities and necessary approvals of
local, state and federal agencies.
36.5 Each party shall bear its own Solicitors' costs for this
Agreement.
36.6 Time wherever mentioned shall be of the essence of this
Agreement.
The Agreement has been executed in two copies of which the parties have
taken one each.
Kuala Lumpur April 5, 2000
UNWIRE AB (PUBL) ERICSSON BUSINESS CONSULTING
(MALAYSIA) SDN BHD
/s/ Michael Wallon /s/ Mikael Karlstrom
----------------------- -------------------------
Michael Wallon Mikael Karlstrom
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