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Exhibit 10.30
ADDENDUM #1 TO COLLABORATION AGREEMENT
This Addendum #1 ("Addendum") is made this 14th day of July, 2000 (the
"Effective Date"), by and among Vyyo, Inc., a Delaware corporation having its
principal address at 20400 Stevens Creek Blvd, Cupertino, California
(hereinafter "Vyyo, Inc"), Vyyo Ltd., an Israeli company having its principal
address at 11, Kiryat Hamada street, Har Hotzvim, Jerusalem, Israel ("Vyyo
Ltd.") (collectively, Vyyo, Inc. and Vyyo Ltd. are referred to herein as "Vyyo")
and ADC Telecommunications, Inc., a Minnesota corporation having its principal
place of business at 12501 Whitewater Drive, Minnetonka, Minnesota 55343
(hereinafter "ADC");
RECITALS
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A. ADC and Phasecom Ltd. entered into a Collaboration Agreement dated
August 6, 1999 (the "Collaboration Agreement");
B. Vyyo Ltd. was formerly known as Phasecom Ltd., and is a wholly-owned
subsidiary of Vyyo, Inc.;
C. Vyyo, Inc. and Vyyo, Ltd. have assumed the benefits and obligations of
the Collaboration Agreement from Phasecom Ltd.;
D. Vyyo and ADC desire to modify certain terms of the Collaboration
Agreement, all as stated below.
NOW, THEREFORE, in consideration of the premises and the mutual promises
set forth below, the parties hereto agree as follows:
1. Effect of Addendum. Except as expressly modified herein, the Collaboration
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Agreement shall remain in full force and effect in accordance with its
terms. All terms used in this Addendum shall have the meaning given them in
the Collaboration Agreement, unless otherwise provided herein. If any
conflict arises between the terms of this Addendum and the Collaboration
Agreement, the terms of this Addendum shall control.
2. Section 1 (c). Section 1 (c) shall be replaced in its entirety as
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follows:
"The foregoing rights granted to Buyer will be subject to the provisions of
Exhibit E."
3. Section 2(a). The second to the last sentence in Section 2 (a) shall be
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amended to replace the word "will" with the word "may."
4. Section 5(d). The second sentence of Section 5(d) is deleted in its
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entirety.
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CONFIDENTIAL
TREATMENT
REQUESTED
5. Section 22 (f). Section 22 (f) shall be amended so that the copy to
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location for Vyyo shall be Dave Hansen at Skadden, Arps, Slate, Meagher &
Flom LLP, 525 University Avenue, Suite 220, Palo Alto, California, 94304.
6. ADC Disclaimer. A new (h) is hereby added to Section 9 of the
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Collaboration Agreement as follows:
EXCEPT AS OTHERWISE SET FORTH IN THIS ADDENDUM, VYYO ACKNOWLEDGES AND
AGREES THAT ADC DISCLAIMS ANY WARRANTY, REPRESENTATION OR GUARANTEE THAT
ADC'S DISTRIBUTION OF THE PRODUCTS WILL GENERATE ANY PARTICULAR LEVEL OF
ACTUAL SALES OR REVENUE TO VYYO, AND ADC AND ITS AFFILIATES, AND THEIR
RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, SUBDISTRIBUTORS AND AGENTS SHALL
HAVE NO LIABILITY OF ANY KIND OR NATURE (INCLUDING, WITHOUT LIMITATION,
DIRECT, INDIRECT, SPECIAL, CONSEQUENTIAL OR ANY OTHER TYPE OF DAMAGES),
REGARDLESS OF THE FORM OF ACTION, FOR ANY FAILURE TO ACHIEVE ANY PARTICULAR
LEVEL OF SALES OR REVENUE TO VYYO.
7. Section 11(e). Section 11(e) of the Collaboration Agreement is hereby
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deleted in its entirety and replaced by the following:
e. Unless Vyyo agrees otherwise in writing, Buyer hereby acknowledges that
copyright and all other intellectual property rights and patent ownership
in the software delivered by Vyyo (as contained in or delivered in
conjunction with the Products) and all connected, modified, improved or
enhanced versions or derivatives thereof delivered by Vyyo, and the
relevant documentation delivered by Vyyo, is owned by and will remain
vested in Vyyo. Title and all intellectual property rights in or relating
to the software delivered by Vyyo (as contained in or delivered in
conjunction with the Products) and the Products documentation delivered by
Vyyo are and shall remain owned by Vyyo. Buyer shall include Vyyo's
patents, patent pending, copyright and/or trade secret notices on all
copies and authorized adaptations in any form of the software contained in
the Products.
8. Section 12. The following is added as Section 12(e):
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e. Manufacturing License. At any one time after ************* and
before through *************, ADC may immediately upon written
notice to Vyyo invoke a worldwide license to use Vyyo's object code
including specifically, software object code and object code for
configuring programmable devices and associated drawings of the hub
for the product which is being sold as a standard product
commercially at that time by Vyyo and any other items reasonably
necessary to allow ADC to manufacture which shall not include
technical
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CONFIDENTIAL TREATEMENT REQUESTED
assistance or documentation used by Vyyo beyond Vyyo's english
translation of documentation used by Vyyo for its own production
("Vyyo Deliverables") to develop and manufacture, use, sell, have
sold and import solely wireless hubs for the MMDS market. If ADC so
elects, then within ten (10) business days after its receipt of
such notice Vyyo will deliver to ADC Vyyo Deliverables. In return
for such license, ADC will pay to Vyyo an amount equal to the
Royalty Percentage (as set forth in Exhibit A) attached hereto of
the total sales price for any product sold by ADC with
functionality similar to that of the Vyyo Deliverables whether or
not the Vyyo Deliverables are used. The total sales price shall not
be less than a commercially reasonable price for such product. This
license is "as is" "where is" with no warranty whatsoever and is
for the Vyyo Deliverables as in effect as of the date of the
invocation of this license. Vyyo will provide to ADC generally
available updates to the standard Vyyo Deliverables (not any that
are customized for third parties) to the extent that Vyyo owns the
intellectual property or can through its best efforts attain the
right to deliver such third party intellectual property without
additional expense to Vyyo. The updates shall only be for wireless
MMDS hubs with the same platform as in the Vyyo Deliverables, such
updates shall incorporate (A) corrections of any substantial
defects, (B) fixes of any minor bugs, and (C) enhancements and new
releases to the Vyyo Deliverables that are generally made available
in the market by Vyyo (collectively "Vyyo Enhancements"). ADC
agrees not to, and its license from Vyyo shall be interpreted to
prohibit the, manufacture products using the Vyyo Deliverables
until six (6) months after the date upon which ADC gives to Vyyo
notice that it intends to manufacture such products. Vyyo's
obligation to deliver to ADC the Vyyo Enhancements shall continue
until the first to occur of (A) the end of the initial term of the
Agreement without extension, (B) the maintenance fee as described
below is not timely paid to Vyyo after written notice is given to
ADC, or (C) any calendar quarter in which ADC fails to purchase at
least *** of all of its wireless MMDS CPEs from Vyyo. To the extent
that ADC claims that Vyyo's CPEs are not competitive in price,
performance or delivery capability the parties agree to meet in
good faith to resolve those issues. If Vyyo after a reasonable
period of time is unable to become competitive in those areas or
build additional requested functionality into the CPE, ADC shall be
entitled to not include in the numerator or denominator of the
applicable equation such CPEs sold by ADC which are not purchased
from Vyyo until Vyyo becomes competitive. In the event that Vyyo
sells directly CPEs to accounts which have been and are currently
purchasing the headends from ADC pursuant to ADC's manufacturing
rights of this Section, those CPEs shall be included in both the
numerator and denominator of the applicable equation. ADC and Vyyo
agree in general to discuss the allocation of maintenance fees
charged to customers of ADC for those Vyyo products resold by ADC.
For products manufactured by ADC hereunder, ADC shall use its
commercially reasonable efforts to split the maintenance fee into
two components. One will be for software maintenance and Vyyo shall
be entitled to receive *** of said amount. If the maintenance fee
cannot be reasonably separated, then Vyyo shall receive *** of the
entire maintenance fee charged by
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CONFIDENTIAL
TREATMENT
REQUESTED
ADC to its customers using products manufactured by ADC pursuant to
this Section. The maintenance fees to be charged by Vyyo to ADC
shall be paid to Vyyo within 30 days after ADC assesses such fees
to its customers. ADC shall report to Vyyo all of its subject sales
within 15 days after the end of each calendar month and Vyyo shall
have a right to audit applicable books and records of ADC in
connection with the royalty and maintenance fees. The cost of the
audit shall be borne by Vyyo unless the audit shows an underpayment
of more than 2.5% of the amounts actually owed, in which case the
full cost of the audit shall be borne by ADC.
9. Section 14(d). Section 14(d) of the Agreement is deleted in its entirety
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and replaced by the following:
d. Notwithstanding the foregoing, Vyyo will have no liability or
obligation, and Buyer shall defend and indemnify Vyyo to the same extent as
Vyyo's defense and indemnity of Buyer in subsection 14(b) above (and not
including the limitations in subsection 14(c)), with respect to any
proceeding or action arising out of (i) modification of the Product other
than by Vyyo or its agents, (ii) combination of the Product with any other
item (including without limitation any claim for contributory infringement
or inducing infringement) if such claim would not have occurred but for
such combination, or (iii) compliance with Buyer's specifications or
design.
10. Pricing. Exhibit A is deleted in its entirety and replaced by the attached
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Exhibit A. Any preferred pricing to ADC, except as stated in Section 3 (d) of
the Agreement and Section II, Paragraphs A, B, C.1-C.3 of Exhibit A hereto,
shall terminate on the first to occur of (i) the date that ADC actually ships a
product to any customer pursuant to its manufacturing rights under Addendum
Section 7 (above), or (ii) July 14, 2002.
11. ADC Requested Product Changes. Section 9 of Exhibit C is deleted in its
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entirety and replaced by the following:
9. Design Changes.
Upon request by ADC, Vyyo will use commercially reasonable efforts to
develop specific changes and additions, including without limitation an ADC
custom product router card (collectively, "Modifications") and shall agree
to negotiate in good faith with ADC for other requests. ADC will provide a
Requirements Specification describing the functionality for the
Modifications as well as the documentation and other deliverables expected.
Vyyo will provide a timely estimate of costs, including travel time, with
the engineering fee to be billed at a rate of ******** per man-year to
perform the development of the applicable Modifications. Upon ADC's
approval of the total price estimate for the effort, Vyyo will perform the
effort and ADC will compensate Vyyo as set forth in the estimate. Unless
the parties agree otherwise in writing, ADC will own all intellectual
property rights (including, without limitation, all patent, copyright,
trade
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CONFIDENTIAL TREATMENT REQUESTED
secrets) in and to any Modifications. In addition, ADC will own
manufacturing rights to any hardware associated with any Modifications that
results from the effort, but not as to any underlying intellectual property
of Vyyo. ADC may request Vyyo to estimate the cost to manufacture any
hardware associated with the Modifications and, upon ADC's written
approval, Vyyo will use commercially reasonable efforts to manufacture a
timely, high quality product that includes the Modifications and make such
product available to ADC for purchase on commercially reasonable terms.
All software associated with the Modifications will be included in the WMTS
software load delivered with the WMTS from Vyyo and shall remain the
intellectual property of Vyyo. Vyyo shall have a perpetual, royalty-free,
worldwide license back for all intellectual property rights including,
without limitation, the Modifications to manufacture a product using the
Modifications for sale to others, except as otherwise agreed in good faith
between the parties for any Modifications that include intellectual
property rights of ADC. Should ADC believe that the Modifications shall
include intellectual property rights of ADC, Vyyo and ADC shall negotiate
in good faith a joint development agreement to discuss the shared ownership
of the Modifications, the license back to Vyyo, any royalties associated
with such license, and any other terms and conditions prior to instructing
Vyyo to perform any development work.
12. Non-Exclusivity. Exhibit E is deleted in its entirety and replaced by the
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attached Exhibit E.
13. Vyyo Payment. Vyyo shall provide to ADC a rebate of ********** as partial
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compensation to ADC for a portion of its costs incurred as a result of
field testing and product testing in the development of the market for the
Products, which was initiated by ADC prior to the Effective Date of this
Addendum. The rebate payment will be made at the rate of *** on the first
********** of products shipped and invoiced after the Effective Date of
this Addendum but before December 31, 2001. In addition, for such ADC
efforts Vyyo shall pay to ADC from the date of this Addendum through the
first to occur of (i) the date that ADC ships any product to any customer
pursuant to its manufacturing rights under Addendum Section 7 (above) using
Vyyo Deliverables, or (ii) July 14, 2002,
**************************************************************************
**************************************************************************
**************************************************************************
**********************************************************************. Any
amounts due pursuant to the immediately preceding sentence shall be due and
payable to ADC by Vyyo on the date that the payment for such Product is due
and payable by ADC to Vyyo. Each party shall have a right of offset in
connection with the payment for the Product and the payment under this
section.
14. Limitation of Damages. Section 19(a) is deleted in its entirety and
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replaced with the following: EXCEPT AS OTHERWISE SPECIFIED HEREIN OR IN
SECTIONS 14 OR 15, NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY
SPECIAL, INDIRECT, OR CONSEQUENTIAL DAMAGES, EXPENSES, OR LOSSES OF ANY
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CONFIDENTIAL TREATMENT REQUESTED
KIND, INCLUDING BUT NOT LIMITED TO LOSS OF PROFITS, USE, REVENUE, OR
GOODWILL OR ANY THIRD PARTY CLAIM AGAINST THE OTHER NOT SPECIFICALLY
INDEMNIFIED AGAINST HEREUNDER, EVEN IF THE PARTY KNEW OR HAD BEEN ADVISED
OF THE POSSIBILITY OF THE PARTY INCURRING THE SAME.
15. Non-Solicitation. ADC and Vyyo agree that they will not, during the
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term of this Agreement and for a period of one (1) year following the
expiration of such term, directly or indirectly solicit for employment or
for services as an independent contractor, any employee of the other or its
respective subsidiaries, if such employee has worked in the broadband
wireless market or with accounts of either company at
*********************************.
16. Miscellaneous. The parties agree in good faith to negotiate the
allocation of maintenance fees and shall allow the other to examine
financial records for the sole purpose of assessing the proportionate
effort and costs to provide the maintenance and upgrades to customers.
17. No Breach. Vyyo acknowledges and agrees that as of the Effective Date of
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this Amendment, ADC is not in breach of the Collaboration Agreement. ADC
acknowledges and agrees that as of the Effective Date of this Amendment,
Vyyo is not in breach of the Colloboration Agreement. Furthermore, the
parties will continue to work in good faith to finalize the Statement of
Works as required by Exhibit D, the terms and conditions of sale as
required by Exhibit H, and the MAC product license and supply agreement as
required by Exhibit N, and any failure to do so within a particular time
limit will not be deemed a material breach of the Collaboration Agreement.
IN WITNESS WHEREOF, the parties, by their duly authorized representatives,
have caused this Addendum to be executed as of the Effective Date.
ADC Telecommunications, Inc. Vyyo, Inc.
/s/ Arun Sobti
By_______________________________ By /S/ Stephen P. Pezzola
Arun Sobti
Name_____________________________ Name Stephen P. Pezzola
President BATG
Its_____________________________ Its General Counsel, Corporate Secretary
Vyyo, Ltd.
/s/ Stephen P. Pezzola
By_______________________________
Stephen P. Pezzola
Name_____________________________
Director, Secretary
Its______________________________
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CONFIDENTIAL
TREATMENT
REQUESTED
Exhibit A
Products and Prices
===================
I. Products
========
A. In this Agreement, "Products" will be understood to mean Vyyo's
present and future head-end wireless modem termination system ("WMTS")
products as set forth herein, and user-end wireless modem units ("MU")
products, as set forth below:
1. *********** of Vyyo's MTS and MU products (existing)
a) Proprietary modem termination system (MTS) and related
components and sub-assemblies
b) Proprietary modem unit (MU)
c) Proprietary configuration and network management software
(NMS) for the MTS and MU.
2. *********** of Vyyo's MTS and MU products (to be developed)
a) Proprietary modem termination system (MTS) and related
components and sub-assemblies
b) Proprietary modem unit (MU)
c) Proprietary configuration and network management software
(NMS) for the MTS and MU.
3. ******************* of Vyyo's MTS and MU products (to be
developed)
a) Proprietary modem termination system (MTS) and related
components and sub-assemblies
b) Proprietary modem unit (MU)
c) Proprietary configuration and network management software
(NMS) for the MTS and MU.
4. Such new Products as may be added to this Agreement by mutual
agreement of the Parties on the basis specified in Exhibit C.
B. All of the Products are intended to enable end-to-end telephony, data
and video communications between a head end modem termination system
and a customer-premise modem unit.
C. Products shall specifically not include any products of any entity
that is merged with, bought by, or otherwise acquired by Vyyo after
the date of this Addendum. However, during the term of the agreement
they shall be subject to Section 1 (a) of Exhibit E provided that
either ADC has not yet invoked its manufacturing right pursuant to
Addendum Section 7, or (b) if such right has been invoked, the right
to receive Updated Vyyo Deliverables has not been terminated.
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CONFIDENTIAL
TREATMENT
REQUESTED
II. PRICES
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A. Unless otherwise agreed in writing, all Products supplied to Buyer will
be at the prices set out in this Exhibit. For any Head-End Product (as
defined in the following subsection) for ***********, the price will be
************ (1) the price in effect as of the effective date of this
Agreement or (2) the price determined in accordance with the following
subsection B.
B. Pricing
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Prices for Products covered by this Agreement will be based on market
prices (the "Market Prices") to be established by good faith
negotiations between the Parties in accordance with Section C.2. of
this Exhibit. The initial Market Prices for currently available
Products are subject to negotiation between the parties. A list of the
currently available Products follows:
Product
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P2001-1.5W Network Ctlr Package w/SNMP
P2001-1.5W Network Controller no SNMP
P2001-RCVR Single channel upstream card
P2001-RCVR Dual channel upstream card
P2001-QoS Quality of Service Module
P200-EX Speed-Demon Wireless Modem
P200-SH SOHO Speed-Demon Wireless Modem
The price for a Product to be sold hereunder will be the
**************************** (the "*******************"). The
******************* will depend whether the Product is intended for use
on customer premises (a "CPE Product") or at the head-end of a system (a
"Head-End Product"). Except as otherwise agreed to by the parties, the
******************** for Preferred Vendor Accounts will be determined as
follows:
Type of Equipment
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CPE Product Head-End Product
-------------------------------- ------------------------------
*** ***
The ******************** for others will be determined as follows:
Type of Equipment
----------------------------------------------------------------------------
CPE Product Head-End Product
----------------------------------------- ------------------------------
*** ***
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CONFIDENTIAL
TREATMENT
REQUESTED
C. General
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1. All prices will be *** Vyyo's ***************** (per Section 4.a.
of the Agreement) unless mutually agreed upon otherwise in an
applicable negotiated Annex. Although Vyyo may publish suggested
wholesale or retail prices, these are suggestions only and Buyer
will be entirely free to determine the actual prices and license
fees at which the Products will be sold or licensed to its
Customers.
2. Market Prices will be valid until superseded by new Market
Prices. Market Prices will be subject to
************************* on a quarterly basis, in February, May,
August and November, beginning in July 2000. Key considerations
for the establishment of Market Prices will be (1) those prices
charged by Vyyo and ADC to their respective customers for
comparable standard products, and (2) competitive pricing in the
market. It is acknowledged by Vyyo that, in general, ADC will
endeavor to sell above the Market Price. Re-negotiated Market
Prices will be reduced to written Annexes, which, when signed and
dated by both parties, will serve as an amendment to this
Agreement, and will supersede any earlier Market Price
determinations.
3. All prices are subject to the provisions of Section 3.d. of the
Agreement.
4. With respect to sales of WTMS Products (which bear the Vyyo
brand), and not CPE Products, by Vyyo directly to
**************************, between the Effective Date hereof and
the first to occur of (a) *************, or (b) the date upon
which ADC first sells product under its manufacturing rights set
forth in Addendum Section 7 of this Addendum to any one of
**************************, Vyyo will pay to ADC a commission
equal to *** of the Net Invoiced Amounts for such Products in
accordance with the terms of Section 6.d of the Agreement.
The parties agree that obtaining accurate information regarding sales prices
charged by the other party will be vital to the calculation under subsection 2,
above. The parties therefore agree that sales by each party may be audited by
the other party in accordance with reasonable procedures to be agreed upon by
the parties at the time of audit with the audit being conducted subject to the
confidentiality provisions of the Agreement.
III. DEFINITIONS. For purposes of this Addendum, the
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******************************* shall be ***, the Royalty Percentage shall be
***, and the Preferred Vendor Accounts shall be
**********************************************.
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CONFIDENTIAL
TREATMENT
REQUESTED
Exhibit E
MARKETING AND PREFERRED VENDOR ACCOUNTS
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I. Marketing Rights
A. Non-exclusive Rights. During the term of this Agreement, Vyyo hereby
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grants ADC the non-exclusive right to market, sell, and otherwise distribute the
Products and any other products referred to in Exhibit A, Section C, directly
and indirectly for resale to any Customers except that ADC shall not have the
right to market, sell or otherwise distribute the Products to *************
(which is an existing house account for Vyyo) within the
**************************.
B. Marketing Collaboration. During the term of this Agreement, ADC shall
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keep Vyyo informed about ADC high-level marketing plans and requirements
relating to the Products.
C. Preferred Vendor Accounts. During the term of this Agreement, Vyyo
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shall actively promote ADC as the preferred vendor to the following Customers
(and their majority-owned subsidiaries) (the "Preferred Vendor Accounts"):
a. ************
b. ******
c. **********
d. *******************
Active promotion by Vyyo will include participating with ADC in joint meetings
and openly promoting ADC to the above Preferred Vendor Accounts as well as
giving ADC preference over Vyyo's other customers on deliveries of all new
releases and production, notwithstanding anything to the contrary in this
Agreement.
D. Non-Solicitation of ADC Accounts. Vyyo agrees that during the term
---------------------------------
of this Agreement it will not actively solicit nor promote sales of the Products
to any ADC Accounts. An "ADC Account" is defined to be any customer with whom
ADC does fifteen percent (15%) or greater of that customer's business in the
Products over the past two quarters.
