<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 30, 1998
SpecTran Corporation
(Exact name of registrant as specified in its charter)
Delaware 0-12489 04-2729372
(State or other jurisdiction (Commission File No.) (IRS Employer
of incorporation) Identification No.)
50 Hall Road, Sturbridge, Massachusetts 01566
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (508) 347-2261
---------------
N/A
(Former name or former address, if changed since last report)
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Item 5. Other Events
As reported in the Company's Report on Form 10-Q for the period ended
September 30, 1998, under "Subsequent Events", on October 30, 1998, the Company
and Lucent Technologies Inc. established a new worldwide, non exclusive license
exchanging rights under their optical fiber patents issued prior to January 1,
1998, and additional patents related to multimode fiber based on applications
filed through October 1998. The Company is licensed by Lucent to make optical
fiber at its existing factories for worldwide use and sale, including export
from the United States. The license contains some product limitations including
certain exclusions to make or sell select specialty fibers for some
applications. Lucent receives non-exclusive, royalty-free worldwide rights. The
Company agreed to pay Lucent a $4.0 million license fee in installments and,
beginning in 2000, a royalty on sales. Lucent has the right to terminate the
agreement if the Company is acquired by an optical fiber manufacturer.
Item 7. Financial Statements and Exhibits
(c) Exhibits
10.111 Patent License Agreement between Lucent Technologies Inc. and SpecTran
Corporation dated October 30, 1998 (confidential treatment has been applied for
redacted portions of the exhibit).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SpecTran Corporation
(Registrant)
Date: February 11, 1999 /s/ Charles B. Harrison
-----------------------
Charles B. Harrison
President and Chief Executive Officer
<PAGE>
EXHIBIT 10.111
PATENT LICENSE AGREEMENT
between
LUCENT TECHNOLOGIES INC.
and
SPECTRAN CORPORATION
Effective upon Signing
Relating to Optical Fiber
<PAGE>
TABLE OF CONTENTS
ARTICLE I - GRANTS OF LICENSES
1.01 Grant
1.02 Duration
1.03 Scope
1.04 Exclusions and Limitations
1.05 Ability to Provide Licenses
1.06 Joint Inventions
1.07 Publicity
ARTICLE II - ROYALTY AND PAYMENTS
2.01 Royalty Calculation and Payments
2.02 Records and Adjustments
2.03 Reports and Payments
ARTICLE III - TERMINATION
3.01 Breach or Acquisition
3.02 Voluntary Termination
3.03 Survival
ARTICLE IV - MISCELLANEOUS PROVISIONS
4.01 Disclaimer
4.02 Nonassignability
4.03 Addresses
4.04 Taxes
4.05 Choice of Law
4.06 Integration
4.07 Outside the United States
4.08 Dispute Resolution
4.09 Releases
4.10 Counterparts
DEFINITIONS APPENDIX
APPENDIX A
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PATENT LICENSE AGREEMENT
Effective as of the date of execution by the last party to execute ("Effective
Date"), Lucent Technologies Inc. ("LUCENT"), a Delaware corporation having an
office at 600 Mountain Avenue, Murray Hill, New Jersey 07974, and SpecTran
Corporation ("SpecTran"), a Delaware corporation having an office at 50 Hall
Road, Sturbridge, MA 01566, agree as follows*:
ARTICLE I
GRANTS OF LICENSES
1.01 Grant
(a) LUCENT grants to SpecTran under LUCENT's PATENTS worldwide,
personal, nonexclusive and, subject to Sections 1.03(c) and 4.02,
non-transferable licenses, with limitations as provided herein,
for:
OPTICAL FIBER
(b) SpecTran grants to LUCENT under SpecTran's PATENTS worldwide,
personal, nonexclusive, royalty-free and, subject to Sections
1.03(c) and 4.02, non-transferable licenses, with limitations as
provided herein, for:
OPTICAL FIBER
1.02 Duration
All licenses granted herein under any patent shall continue for the entire
unexpired term of such patent.
1.03 Scope
(a) Subject to the exclusions and limitations referred to in this
Agreement, the licenses granted herein to SpecTran are licenses to (i) make,
use, lease, offer to sell, sell, import subject to Section 1.04(d) and export
LICENSED PRODUCTS; (ii) make, have made, use and import machines, tools,
materials and other instrumentalities, insofar as such machines, tools,
materials and other instrumentalities are involved in or incidental to the
development, manufacture, testing or repair of LICENSED PRODUCTS which are or
have been made, used, leased, owned, sold or imported by the grantee of such
license; and (iii) convey to any customer of the grantee, with respect to any
LICENSED PRODUCT which is sold or leased by such grantee to such customer,
rights to use and resell such LICENSED PRODUCT as sold or leased by such grantee
(whether or not as part of a larger combination); provided, however, that no
rights may be conveyed to customers with respect to any invention which is
directed to (1) a combination of such LICENSED PRODUCT (as sold or leased) with
any other product, (2) a method or process which is other than the inherent use
of such LICENSED PRODUCT itself (as sold or leased), or (3) a method or process
involving the use of a LICENSED PRODUCT to manufacture (including associated
testing) any other product.
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*Any term in capital letters which is defined in the Definitions
Appendix shall have the meaning specified therein.
<PAGE>
(b) The licenses granted herein to LUCENT are licenses to (i) make, have
made, use, lease, sell and import LICENSED PRODUCTS; (ii) make, have made, use
and import machines, tools, materials and other instrumentalities insofar as
such machines, tools, materials and other instrumentalities are involved in or
incidental to the development, manufacture, testing or repair of LICENSED
PRODUCTS which are or have been made, used, leased, owned, sold or imported by
the grantee of such license; and (iii) convey to any customer of the grantee,
with respect to any LICENSED PRODUCT which is sold or leased by such grantee to
such customer, rights to use and resell such LICENSED PRODUCT as sold or leased
by such grantee (whether or not as part of a larger combination); provided,
however, that no rights may be conveyed to customers with respect to any
invention which is directed to (1) a combination of such LICENSED PRODUCT (as
sold or leased) with any other product, (2) a method or process which is other
than the inherent use of such LICENSED PRODUCT itself (as sold or leased), or
(3) a method or process involving the use of a LICENSED PRODUCT to manufacture
(including associated testing) any other product.
(c) The grant of each license hereunder includes the right to grant
sublicenses within the scope of such license to a Party's RELATED COMPANIES for
so long as they remain its RELATED COMPANIES, subject to Section 4.02(b). Any
such sublicense may be made effective retroactively, but not prior to the
effective date hereof, nor prior to the sublicensee's becoming a RELATED COMPANY
of such Party.
1.04 Exclusions and Limitations
(a) No rights whatsoever are granted to SpecTran under any LUCENT PATENT to
make, have made, use, offer to sell, sell or import the following products and
processes: [REDACTED MATERIAL FILED SEPARATELY WITH COMMISSION; CONFIDENTIAL
TREATMENT REQUESTED]
(b) No rights whatsoever are granted to SpecTran under Section 1.04(a)(ii)
above for [REDACTED MATERIAL FILED SEPARATELY WITH COMMISSION; CONFIDENTIAL
TREATMENT REQUESTED]
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(c) Subject to the exclusions and limitations in this Agreement (including
Section 2.01(b) and 2.01(c), SpecTran's rights hereunder include the rights (i)
within the United States only to make at its existing factories and (ii) abroad
to make at factories of its foreign SUBSIDIARIES; provided, however that the
combined domestic and foreign production of NZDF does not exceed the limitations
of clause (iv) below unless the additional royalties are paid in accordance with
Section 2.01(b) and (iii) subject to Section 2.01(c):
(i) offer to sell, sell and export worldwide multimode
OPTICAL FIBER;
(ii) offer to sell, sell and export worldwide
NON-PREMIUM OPTICAL FIBER;
(iii) offer to sell, sell and export worldwide rare
earth-doped optical fiber and Raman fiber for
medical, military and distributed sensor
applications; provided, however, no rights are
granted for [REDACTED MATERIAL FILED SEPARATELY WITH
COMMISSION; CONFIDENTIAL TREATMENT REQUESTED]; and
(iv) Subject to Section 2.01(b) and (c), offer to sell and
sell within the United States the following quantity
of NZDF in each year, and to export for sale an equal
quantity each year outside the United States, as
follows:
YEAR QUANTITY( kilo-kilometers per year) [REDACTED MATERIAL
FILED SEPARATELY WITH COMMISSION; CONFIDENTIAL TREATMENT REQUESTED]
Prior to January 1, 2000, SpecTran's rights hereunder are limited to
[REDACTED MATERIAL FILED SEPARATELY WITH COMMISSION; CONFIDENTIAL
TREATMENT REQUESTED]
(d) The Parties agree that no right is provided to SpecTran and/or its
SUBSIDIARIES to import into the United States or for any SpecTran foreign
SUBSIDIARY to directly or indirectly (e.g., through other countries) export to
the United States under this Agreement.
1.05 Ability to Provide Licenses
(a) It is recognized that certain actions of the Parties to this Agreement
may limit their ability to provide licenses hereunder without constituting a
breach. In particular, (i) prior to the earliest filing of a patent application
disclosing an invention of a Party or its RELATED COMPANY, such Party or RELATED
COMPANY may assign to a third party the title to patents on such invention, or
(ii) prior to the execution of this Agreement, a Party or its RELATED COMPANY
may have limited by contract its ability to provide licenses hereunder with
respect to certain patents or technologies.
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(b) Each Party agrees to disclose to the other Party, promptly upon receipt
of a written request for such disclosure, any such assignment or other
contractual limitation with respect to any patent licensed hereunder and which
is specifically identified in such request.
(c) A Party's failure to meet any obligation hereunder, due to the
assignment of title to any invention or patent, or the granting of any licenses,
to the United States Government or any agency or designee thereof pursuant to a
statute or regulation of, or contract with, such Government or agency, shall not
constitute a breach of this Agreement.
1.06 Joint Inventions
(a) There are countries (not including the United States) which require the
express consent of all inventors or their assignees to the grant of licenses or
rights under patents issued in such countries for joint inventions.
(b) Each Party shall give such consent, or shall obtain such consent from
its RELATED COMPANIES, its employees or employees of any of its RELATED
COMPANIES, as required to make full and effective any such licenses and rights
respecting any joint invention granted to the grantee hereunder by such Party
and by another licensor of such grantee.
(c) Each Party shall take steps which are reasonable under the
circumstances to obtain from third parties whatever other consents are necessary
to make full and effective such licenses and rights respecting any joint
invention purported to be granted by it hereunder. If, in spite of such
reasonable efforts, such Party is unable to obtain the requisite consents from
such third parties, the resulting inability of such Party to make full and
effective its purported grant of such licenses and rights shall not be
considered to be a breach of this Agreement.
1.07 Publicity
(a) Nothing in this Agreement shall be construed as conferring upon either
Party or its RELATED COMPANIES any right to include in advertising, packaging or
other commercial activities related to a LICENSED PRODUCT, any reference to the
other Party (or any of its RELATED COMPANIES), its trade names, trademarks or
service marks or to indicate that such LICENSED PRODUCT is in any way certified
by the other Party hereto or its RELATED COMPANIES.
<PAGE>
(b) Except as required by law and regulation, the terms, but not the
existence, of this Agreement shall be treated as confidential information, and
neither Party shall disclose such terms to any third party without the prior
written consent of the other Party; provided, however, that either Party may
represent to suppliers and customers that such Party is licensed for the
products and patents provided by this Agreement, to the extent required for a
specific commercial transaction with that supplier or customer. Where required
by law and regulation, the Party in need of making such disclosure of certain
terms of the agreement will seek the written consent of the other Party which
will not be unreasonably withheld.
ARTICLE II
ROYALTY AND PAYMENTS
2.01 Royalty Calculation and Payments
SpecTran shall make payments to LUCENT at the address specified in Section
4.03(b), as follows:
(a) In consideration for purchasing the rights to obtain the licenses granted
herein, SpecTran shall pay to Lucent a total upfront fee totaling four
million United States dollars (U.S. $ 4,000,000.00) to be paid as follows
(A) the sum of seven hundred fifty thousand United States dollars (U.S. $
750,000.00) within ninety (90) days after execution of this Agreement;
(B) six semiannual payments each for the sum of five hundred thousand
United States dollars (U.S. $500,000.00) within thirty (30) days of June
30 and December 31 beginning with the first installment date of June 30,
1999 and ending with the final $500,000.00 installment on December 31,
2001, and (C) the sum of two hundred fifty thousand United States dollars
(U.S. $250,000.00) within thirty days of June 30, 2002.
The parties agree that the payment obligation of Section 2.01(a) of four
million United Stated dollars (U.S. $ 4,000,000.00) including the
semiannual payments shall survive any termination of this Agreement by
SpecTran and are not refundable or creditable to any other payments
required hereunder.
(b) For the rights granted to SpecTran in each semi-annual period beginning
in 2000, SpecTran shall make the following additional semi-annual royalty
payments to LUCENT in United States dollars based upon a royalty that
shall accrue in such semi-annual period and shall be payable on a
semiannual basis within thirty days of June 30 and December 31 for the
preceding semiannual period. In each instance in this Agreement,
reference to SpecTran's total gross revenues includes SpecTran's and its
RELATED COMPANIES' total gross revenues excluding sales to LUCENT and
excluding packing costs, costs of insurance and transportation, and
import, export, excise, sales and value added taxes and customs duties
associated with such sales. SpecTran shall pay LUCENT the lesser of:
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(i) a sum calculated at a royalty rate of [REDACTED MATERIAL FILED
SEPARATELY WITH COMMISSION; CONFIDENTIAL TREATMENT REQUESTED]. In
addition to any other fees payable by SpecTran hereunder,
SpecTran shall pay to LUCENT a royalty of [REDACTED MATERIAL
FILED SEPARATELY WITH COMMISSION; CONFIDENTIAL TREATMENT
REQUESTED] in excess of the quantity limits specified in Section
1.04(c)(iv); or
(ii) the combined royalty of [REDACTED MATERIAL FILED SEPARATELY WITH
COMMISSION; CONFIDENTIAL TREATMENT REQUESTED]
In addition to any other fees payable by SpecTran hereunder, SpecTran shall
pay to LUCENT an additional royalty of [REDACTED MATERIAL FILED SEPARATELY
WITH COMMISSION; CONFIDENTIAL TREATMENT REQUESTED] in excess of the
quantity limits specified in Section 1.04(iv)(c).
(c) The parties agree that [REDACTED MATERIAL FILED SEPARATELY WITH
COMMISSION; CONFIDENTIAL TREATMENT REQUESTED].
(d) Subject to the exclusions and limitations referred to in this Agreement,
royalties payable hereunder are for all of LUCENT's PATENTS.
(e) Overdue payments hereunder shall be subject to a late payment charge
calculated at an annual rate of three percent (3%) over the prime rate or
successive prime rates (as posted in New York City) during delinquency.
If the amount of such late payment charge exceeds the maximum permitted
by law, such charge shall be reduced to such maximum.
(f) Notwithstanding any other provisions hereunder, royalty shall accrue and
be payable only to the extent that enforcement of SpecTran's obligation
to pay such royalty would not be prohibited by applicable law.
2.02 Records and Adjustments
(a) SpecTran shall keep full, clear and accurate records with respect to all
LICENSED PRODUCTS and shall furnish any information which LUCENT may
reasonably prescribe from time to time to enable LUCENT to ascertain the
proper royalty due hereunder on account of products sold, leased and put
into use by SpecTran or any of its RELATED COMPANIES. SpecTran shall
retain such records with respect to each LICENSED PRODUCT for at least
seven (7)
<PAGE>
years from the sale, lease or putting into use of such LICENSED PRODUCT. LUCENT
shall have the right through its accredited auditors to make an examination,
once annually, during normal business hours, of all records and accounts bearing
upon the amount of royalty payable to it hereunder and will not use such
information except to verify royalty payable. Prompt adjustment shall be made to
compensate for any errors or omissions disclosed by such examination.
(b) Independent of any such examination, LUCENT will credit to SpecTran the
amount of any overpayment of royalties made in error which is identified
and fully explained in a written notice to LUCENT delivered within twelve
(12) months after the due date of the payment which included such alleged
overpayment, provided that LUCENT is able to verify, to its own
satisfaction, the existence and extent of the overpayment.
(c) No refund, credit or other adjustment of royalty payments shall be made
by LUCENT except as provided in this Section 2.02. Rights conferred by
this Section 2.02 shall not be affected by any statement appearing on any
check or other document, except to the extent that any such right is
expressly waived or surrendered by a Party having such right and signing
such statement.
2.03 Reports and Payments
(a) Within thirty (30) days after June 30 and December 31 of each year,
SpecTran shall furnish to LUCENT at the address specified in Section 4.03
a statement certified by a responsible official of SpecTran showing, in a
manner acceptable to LUCENT, the following disclosures with respect all
licensed sales made by SpecTran and its RELATED COMPANIES in the
preceding semiannual period for such calendar year and make all payments
required hereunder if not specified as payable on other dates:
(i) all LICENSED PRODUCTS which were sold, leased or put
into use during the preceding semi-annual period for
such calendar year;
(ii) the FAIR MARKET VALUES of such LICENSED PRODUCTS; and
(iii) the amount of royalty payable thereon.
If no LICENSED PRODUCT has been so sold, leased or put into use, the
statement shall show that fact.
(b) Within thirty (30) days of June 30 and December 31 of each calendar year,
SpecTran shall pay in United States dollars to LUCENT at the address
specified in Section 4.03 the royalties payable in accordance with
such statement.
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(c) Overdue payments hereunder shall be subject to a late payment charge
calculated at an annual rate of three percentage points (3%) over the
prime rate or successive prime rates (as posted in New York City) during
delinquency. If the amount of such charge exceeds the maximum permitted
by law, such charge shall be reduced to such maximum.
(d) When a company ceases to be a RELATED COMPANY of SpecTran, royalties
which have accrued with respect to any products of such company, but
which have not been paid, shall become payable with SpecTran's next
scheduled royalty payment.
ARTICLE III
TERMINATION
3.01 Breach or Acquisition
(a) In the event of a material breach of this Agreement by either Party, the
other Party may, in addition to any other remedies that it may have, at
any time terminate all licenses and rights granted by it hereunder by not
less than two (2) months' written notice specifying such breach, unless
within the period of such notice all breaches specified therein shall
have been remedied.
(b) In the event of a material breach of this Agreement by LUCENT or its
SUBSIDIARIES, or of any loss or injury to the CORPORATION arising out of
this Agreement, for which LUCENT or its SUBSIDIARIES is liable to
SpecTran , LUCENT's and its SUBSIDIARIES' total cumulative liability to
SpecTran for all such breaches, losses and injuries shall be the lesser
of (i) the actual value of the injury or loss to the CORPORATION or (ii)
the total royalties paid to LUCENT.
(c) The Parties agree that if SpecTran is acquired by an OPTICAL FIBER
manufacturer, this Agreement may be immediately terminated by LUCENT.
(d) If SpecTran is acquired by other than an OPTICAL FIBER manufacturer and
continues operation as a separately identifiable business, then the
licenses granted hereunder to SpecTran under licensed patents which have
been first filed prior to the date of such acquisition may continue, but
only (i) for the duration and term of licenses as specified in this
Agreement; (ii) to the extent and for the time that SpecTran functions as
a separately identifiable business, and (iii) for products and services
of the kind provided by SpecTran prior to its acquisition and not to any
products or services of any entity which acquires SpecTran.
<PAGE>
3.02 Voluntary Termination
By written notice to the other Party, either Party may voluntarily terminate all
or a specified portion of the licenses and rights granted to it hereunder. Such
notice shall specify the effective date (not more than six (6) months prior to
the giving of said notice) of such termination and shall clearly specify any
affected patent, invention or product.
3.03 Survival
(a) If a company ceases to be a RELATED COMPANY of a Party, licenses and
rights granted hereunder with respect to patents of such company on
inventions made prior to the date of such cessation, shall not be
affected by such cessation.
(b) Any termination of licenses and rights of a Party under the provisions of
this Article III shall not affect such Party's licenses, rights and
obligations with respect to any LICENSED PRODUCT made prior to such
termination, and shall not affect the other Party's licenses and rights
(and obligations related thereto) hereunder.
ARTICLE IV
MISCELLANEOUS PROVISIONS
4.01 Disclaimer
Neither Party nor any of its SUBSIDIARIES makes any representations, extends any
warranties of any kind, assumes any responsibility or obligations whatever, or
confers any right by implication, estoppel or otherwise, other than the
licenses, rights and warranties herein expressly granted.
4.02 Nonassignability
(a) The Parties hereto have entered into this Agreement in contemplation of
personal performance, each by the other, and intend that the licenses and rights
granted hereunder to a Party not be extended to entities other than such Party's
RELATED COMPANIES without the other Party's express written consent. All of
LUCENT's right, title and interest in this Agreement and any licenses and rights
granted to it hereunder may be assigned to any direct or indirect successor to
the business of LUCENT pertaining to this Agreement , which successor shall
thereafter be deemed substituted for LUCENT as the Party hereto, effective upon
such assignment; but neither this Agreement nor any licenses or rights hereunder
shall be otherwise assignable or transferable
<PAGE>
(in insolvency proceedings, by reason of a corporate merger, or otherwise) by
either Party without the express written consent of the other Party.
(b) Notwithstanding the foregoing, if any of the Parties divests all or a
portion of its business and such divested business continues operation as a
separately identifiable business, then the licenses granted hereunder to the
divesting Party under licensed patents which have been first filed prior to the
date of such divestiture may be sublicensed to such divested separate business,
but only (i) for the duration and term of licenses as specified in this
Agreement; (ii) to the extent and for the time the divested business functions
as a separately identifiable business, and (iii) for products and services of
the kind provided by the divested business prior to its divestiture and not to
any products or services of any entity which acquires the divested business.
This subsection shall apply regardless of whether the business is divested by a
sale of assets or as a sale of a legal entity (e.g., sale of a SUBSIDIARY). If
the Party divesting such business is required to make royalty payments or
provide other compensation under this Agreement, it shall continue to be
obligated to do so for itself and, if and to the extent a sublicense is granted,
for the divested business. The sublicensing rights specified herein shall not
apply to any business other than a RELATED COMPANY the acquisition of which by a
party is subsequent to the effective date of this Agreement.
(c) Notwithstanding any other provision herein:
(i) SpecTran may not [REDACTED MATERIAL FILED SEPARATELY WITH COMMISSION;
CONFIDENTIAL TREATMENT REQUESTED]
(ii) If LUCENT, in its sole discretion [REDACTED MATERIAL FILED SEPARATELY
WITH COMMISSION; CONFIDENTIAL TREATMENT REQUESTED]
4.03 Addresses
(a) Any notice or other communication hereunder shall be sufficiently given
to SpecTran when sent by certified mail (or an equivalent means that
provides a return receipt) addressed to SpecTran at the above address or
to LUCENT when sent by certified mail addressed to Contract
Administrator, Intellectual Property Division, Lucent Technologies Inc.,
Suite 105, 14645 Northwest 77th Avenue, Miami Lakes, Florida 33014,
United States of America. Changes in such addresses may be specified by
written notice.
(b) Payments by SpecTran shall be made to Lucent at Sun Trust, P.O. Box
913021, Orlando, Florida, 32891-3021, United States of America.
<PAGE>
Alternatively, payments to Lucent may be made by bank wire transfers to LUCENT's
account: Lucent Technologies Licensing, Account No.[REDACTED MATERIAL FILED
SEPARATELY WITH COMMISSION; CONFIDENTIAL TREATMENT REQUESTED], at Chase
Manhattan Bank, N.A., Four Chase Metrotech Center, Brooklyn, New York, 11245,
United States of America. Changes in such address or account may be specified by
written notice.
4.04 Taxes
SpecTran shall pay any tax, duty, levy, customs fee, or similar charge
("taxes"), including interest and penalties thereon, however designated, imposed
as a result of the operation or existence of this Agreement, including taxes
which SpecTran is required to withhold or deduct from payments to LUCENT, except
(i) net income taxes imposed upon LUCENT by any governmental entity within the
United States (the fifty (50) states and the District of Columbia), and (ii) net
income taxes imposed upon LUCENT by jurisdictions outside the United States
which are allowable as a credit against the United States Federal income tax of
LUCENT or any of its SUBSIDIARIES. In order for the exception in (ii) to be
effective, SpecTran must furnish to LUCENT evidence sufficient to satisfy the
United States taxing authorities that such taxes have been paid.
4.05 Choice of Law
The Parties are familiar with the principles of New York commercial law, and
agree that the patent laws of the United States or the patent laws of any other
country as may be appropriate, and in so far as not pre-empted by U.S. patent
law, the law of New York shall apply in any dispute arising with respect to this
Agreement.
4.06 Integration
This Agreement sets forth the entire Agreement and understanding between the
Parties as to the subject matter hereof and merges all prior discussions between
them. Neither of the Parties shall be bound by any warranties, understandings or
representations with respect to such subject matter other than as expressly
provided herein or in a writing signed with or subsequent to execution hereof by
an authorized representative of the Party to be bound thereby.
4.07 Outside the United States
(a) There are countries in which the owner of an invention is entitled to
compensation, damages or other monetary award for another's unlicensed
manufacture, sale, lease, use or importation involving such invention
prior to the date of issuance of a patent for such invention but on or
after a certain earlier date, hereinafter referred to as the invention's
"protection commencement date" (e.g., the date of publication of allowed
claims or the date of publication or "laying open" of the filed patent
application). In some
<PAGE>
instances, other conditions precedent must also be fulfilled (e.g., knowledge or
actual notification of the filed patent application). The Parties agree that (i)
an invention which has a protection commencement date in any such country may be
used in such country pursuant to the terms of this Agreement on and after any
such date, and (ii) all such conditions precedent are deemed satisfied by this
Agreement.
(b) There may be countries in which a Party hereto may have, as a consequence
of this Agreement, rights against infringers of the other Party's patents
licensed hereunder. Each Party hereby waives any such right it may have
by reason of any third Party's infringement or alleged infringement of
any such patents.
(c) SpecTran hereby agrees to register or cause to be registered, to the
extent required by applicable law, and without expense to LUCENT or any
of its RELATED COMPANIES, any agreements wherein sublicenses are granted
by it under LUCENT's PATENTS. SpecTran hereby waives any and all claims
or defenses, arising by virtue of the absence of such registration, that
might otherwise limit or affect its obligations to LUCENT.
4.08 Dispute Resolution
(a) If a dispute arises out of or relates to this Agreement, or the breach,
termination or validity thereof, the Parties agree to submit the dispute
to a sole mediator selected by the Parties or, at any time at the option
of a Party, to mediation by the American Arbitration Association ("AAA").
If not thus resolved, it shall be referred to a sole arbitrator selected
by the Parties within thirty (30) days of the mediation, or in the
absence of such selection, to AAA arbitration which shall be governed by
the United States Arbitration Act.
(b) Any award made (i) shall be a bare award limited to a holding for or
against a Party and affording such remedy as is deemed equitable, just
and within the scope of the Agreement; (ii) shall be without findings as
to issues (including but not limited to patent validity and/or
infringement) or a statement of the reasoning on which the award rests;
(iii) may in appropriate circumstances (other than patent disputes)
include injunctive relief; (iv) shall be made within four (4) months of
the appointment of the arbitrator; and (v) may be entered in any court.
(c) The requirement for mediation and arbitration shall not be deemed a
waiver of any right of termination under this Agreement and the
arbitrator is not empowered to act or make any award other than based
solely on the rights and obligations of the Parties prior to any such
termination.
(d) The arbitrator shall be knowledgeable in the legal and technical aspects
of this Agreement and shall determine issues of arbitrability but may not
limit, expand or otherwise modify the terms of the Agreement.
<PAGE>
(e) The Agreement shall be interpreted in accordance with the patent laws of
the United States or the patent laws of any other country as may be
appropriate, and in so far as not pre-empted by U.S. patent law, the laws
of the State of New York exclusive of its conflict of laws provisions and
the place of mediation and arbitration shall be New York City.
(f) Each Party shall bear its own expenses but those related to the
compensation and expenses of the mediator and arbitrator shall be borne
equally.
(g) A request by a Party to a court for interim measures shall not be deemed
a waiver of the obligation to mediate and arbitrate.
(h) The arbitrator shall not have authority to award punitive or other
damages in excess of compensatory damages and each Party irrevocably
waives any claim thereto.
(i) Except as required by law, the Parties, their representatives, other
participants and the mediator and arbitrator shall hold the existence,
content and result of mediation and arbitration in confidence.
4.09 Releases
(a) Subject to Section 4.09(c) and for good and valuable consideration,
LUCENT, for itself and for its present RELATED COMPANIES, hereby irrevocably
releases SpecTran, its present RELATED COMPANIES and all customers (purchasers
and users) of LICENSED PRODUCTS as of the effective date hereof to SpecTran,
from all claims, demands and rights of action which LUCENT or any of its present
RELATED COMPANIES may have on account of any infringement or alleged
infringement of any patent issued in any country of the world by reason of the
manufacture or any past or future use, lease, sale, offer for sale or
importation of any of such products which, prior to the effective date hereof,
were manufactured by or for, or sold or used or furnished or imported by
SpecTran or any of its present RELATED COMPANIES.
(b) Subject to Section 4.09(c), and for good and valuable consideration,
SpecTran, for itself and for its present RELATED COMPANIES, hereby irrevocably
releases LUCENT (for the purposes of this Section 4.09(b) "LUCENT" means Lucent
Technologies Inc. as it presently exists and as it formerly existed as a part of
AT&T Corp.), its present RELATED COMPANIES, and all customers (purchasers and
users) of LICENSED PRODUCTS as of the effective date hereof to LUCENT, from all
claims, demands and rights of action which SpecTran or any of its present
RELATED COMPANIES may have on account of any infringement or alleged
infringement of any patent issued in any country of the world by reason of the
manufacture or any past or future use, lease, sale, offer for sale or
importation of any of such products which, prior to the effective date hereof,
were manufactured by or for, or used, furnished or imported by, LUCENT or any of
its present RELATED COMPANIES.
(c) With respect to customers (purchasers and users) of a grantee, such
releases shall not extend to any patent which is directed to (i) a
combination of a product of the kind herein licensed as of the effective
date hereof with any other product; (ii) a method or process which is
other than the inherent use of a product of the kind herein licensed (as
furnished to such customers); or (iii) a method or process involving the
use of a product of the kind herein licensed as of the effective date
hereof to manufacture (including associated testing) any other product.
4.10 Counterparts
This Patent License Agreement may be executed by the Parties in any number of
identical counterparts, all of which together shall constitute the final
agreement. The Parties further agree that this Patent License Agreement shall be
of no force or effect until the date of the last execution by any Party, and
that the executed counterparts may be exchanged by facsimile transmission.
<PAGE>
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed
in duplicate originals by its duly authorized representatives on the respective
dates entered below.
LUCENT TECHNOLOGIES INC.
By: s/s M.R. Greene
---------------
M. R. Greene
Vice President - Intellectual Property
Date: 10-30-98
--------
SpecTran CORPORATION
By: s/s Charles B. Harrison
-----------------------
Date: October 30, 1998
----------------
THIS AGREEMENT DOES NOT BIND OR OBLIGATE
EITHER PARTY IN ANY MANNER UNLESS DULY
EXECUTED BY AUTHORIZED REPRESENTATIVES OF
BOTH PARTIES.
<PAGE>
DEFINITIONS APPENDIX
CLASSIC TRUE WAVE FIBER means OPTICAL FIBER which is NON ZERO DISPERSION FIBER
having an [REDACTED MATERIAL FILED SEPARATELY WITH COMMISSION; CONFIDENTIAL
TREATMENT REQUESTED PORTION FILED SEPARATELY - CONFIDENTIAL TREATMENT
REQUESTED].
FAIR MARKET VALUE means, with respect to any OPTICAL FIBER sold, leased or put
into use, the greater of (i) the selling price which a seller would realize from
an unaffiliated buyer in an arm's length sale of an identical product in the
same quantity and at the same time and place as such sale, lease or putting into
use; or (ii) the selling price actually obtained for such OPTICAL FIBER in the
form in which it is sold.
In determining "selling price" the following shall be excluded:
(a) packing costs;
(b) costs of insurance and transportation; and
(c) import, export, excise, sales and value added taxes
and customs duties.
LICENSED PRODUCT means, as to any grantee, any product (including any specified
combination of other products) listed for such grantee in Section 1.01 excluding
those products listed in Section 1.04.
LUCENT's PATENTS means all patents (including utility models but excluding
design patents and design registrations) owned and controlled by LUCENT or its
wholly-owned SUBSIDIARIES (including patents which LUCENT and its RELATED
COMPANIES do not own but have a right to license),
(1) claiming:
(i) an OPTICAL FIBER
(ii) a method of or an apparatus for making (including
quality control and testing) an OPTICAL FIBER, or
(iii) a material used in the manufacture of or forming a
part of an OPTICAL FIBER; and
(2) issued prior to January 1, 1998 in any country of the world, and any
patent issuing from an
application claiming priority from any such issued patents (except as
below) with respect to which and to the extent that LUCENT or its
wholly-owned SUBSIDIARIES has a right, as of the date of execution of
this Agreement, to grant the licenses granted herein; provided,
however, the term means and includes applications resulting in patents
claiming multimode OPTICAL FIBER filed prior to the Effective Date of
this Agreement.
The term LUCENT's PATENTS shall exclude any and all patents and patent rights
excluded in Section 1.04, including but not limited to:
<PAGE>
(1) [REDACTED MATERIAL FILED SEPARATELY WITH COMMISSION; CONFIDENTIAL
TREATMENT REQUESTED];
(2) related to a method or means to introduce dispersion compensation into
a transmission system using one or more OPTICAL FIBERS, [REDACTED MATERIAL FILED
SEPARATELY WITH COMMISSION; CONFIDENTIAL TREATMENT REQUESTED];
(3) related to a method or means for [REDACTED MATERIAL FILED SEPARATELY
WITH COMMISSION; CONFIDENTIAL TREATMENT REQUESTED]; and
(4) claiming [REDACTED MATERIAL FILED SEPARATELY WITH COMMISSION;
CONFIDENTIAL TREATMENT REQUESTED].
Subject to all of the restrictions, exclusions and limitations herein, the term
LUCENT's PATENTS includes but is not limited to OPTICAL FIBER patents listed in
Appendix A, their foreign counterparts and any reissues, reexaminations or
extensions thereof.
NON-PREMIUM OPTICAL FIBER means an OPTICAL FIBER other than PREMIUM OPTICAL
FIBER including but not limited to what is commonly known in the industry as:
conventional standard matched clad single mode fibers, multimode optical fibers,
conventional dispersion shifted fibers (but not including any form of non-zero
dispersion fiber), dispersion flattened fibers and polarization maintaining
fiber.
NON ZERO DISPERSION FIBER (NZDF) means an OPTICAL FIBER designed to [REDACTED
MATERIAL FILED SEPARATELY WITH COMMISSION; CONFIDENTIAL TREATMENT REQUESTED].
OPTICAL FIBER means optical transmission fiber drawn from an optical fiber
preform made by vapor phase methods, including but not limited to MCVD, OVD, and
VAD methods or combinations thereof, and/or in combination with rod-in-tube
overcladding methods. OPTICAL FIBER includes, but is not limited to, single mode
optical fiber, multimode optical fiber, dispersion shifted fiber (including but
not limited to NON-ZERO DISPERSION FIBER), and polarization maintaining fiber.
PREMIUM OPTICAL FIBER means those OPTICAL FIBERS commonly referred to in the
industry as [REDACTED MATERIAL FILED SEPARATELY WITH COMMISSION; CONFIDENTIAL
TREATMENT REQUESTED].
RELATED COMPANIES of a company are SUBSIDIARIES of the company and any other
company so designated as agreed to in writing by LUCENT and SpecTran.
<PAGE>
SpecTran's PATENTS means all patents (including utility models but excluding
design patents and design registrations) owned and controlled by SpecTran or its
wholly-owned SUBSIDIARIES (including patents which SpecTran and its RELATED
COMPANIES do not own but have a right to license),
(1) claiming:
(i) an OPTICAL FIBER
(ii) a method of or an apparatus for making (including
quality control and testing) an OPTICAL FIBER, or
(iii) a material used in the manufacture of or forming a part
of an OPTICAL FIBER; and
(2) issued prior to January 1, 1998 in any country of
the world, and any patent issuing from an application claiming priority from any
such issued patents with respect to which and to the extent that SpecTran or its
wholly-owned SUBSIDIARIES has a right, as of the date of execution of this
Agreement, to grant the licenses granted herein; provided, however, the term
means and includes applications resulting in patents claiming multimode OPTICAL
FIBER filed prior to October 1, 1998.
SUBSIDIARY of a company means a corporation or other legal entity (i) the
majority of whose shares or other securities entitled to vote for election of
directors (or other managing authority) is now or hereafter controlled by such
company either directly or indirectly; or (ii) which does not have outstanding
shares or securities but the majority of whose ownership interest representing
the right to manage such corporation or other legal entity is now or hereafter
owned and controlled by such company either directly or indirectly; but any such
corporation or other legal entity shall be deemed to be a SUBSIDIARY of such
company only as long as such control or ownership and control exists. The term
does not mean or include, without limitation, General Photonics, LLC.
<PAGE>
APPENDIX A
SELECT LUCENT OPTICAL FIBER PATENTS
- -------------------------------------------------------------------------------
U.S. Patent AUTHOR FILING DATE ISSUE DATE
# TITLE
- -------------------------------------------------------------------------------
[REDACTED MATERIAL FILED SEPARATELY WITH COMMISSION; CONFIDENTIAL
TREATMENT REQUESTED]
