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3/24/97 IBM8K.doc
UNITED STATES
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): March 25, 1997
(March 10, 1997)
Uniphase Corporation
(Exact name of Registrant as Specified in its Charter)
Delaware 0-22874 94-2579683
(State of Other (Commission File (IRS Employer Identification
Jurisdiction No.) No.)
of Incorporation)
163 Baypointe Parkway, San Jose, California 95134
(Address of Principal Executive Offices) (Zip Code)
(408) 434-1800
(Registrant's Telephone Number, Including Area Code)
Page 1 of 118 Pages
Exhibit Index Located on Page 4
INFORMATION TO BE INCLUDED IN REPORT
Item 2. Acquisition or Disposition of Assets
(a) Pursuant to the Purchase Agreement dated as of March 10, 1997, by
and between the Registrant, Uniphase Laser Enterprise AG ("ULE"), a Swiss
corporation and a wholly owned subsidiary of the Registrant, and
International Business Machines Corporation ("IBM"), a New York corporation,
the Registrant closed a transaction to acquire the assets (the "Assets") of
"IBM Laser Enterprise," a part of IBM's Zurich Research Laboratory in
Switzerland. The aggregate purchase price paid for the Assets was
$45,000,000.00, which payment was made in cash. The purchase price was
determined during arms length negotiations between IBM the Registrant and
ULE which took into account IBM Laser Enterprise's financial position,
operating history, products, Intellectual property and other factors relating
to IBM Laser Enterprise's business and certain income tax aspects of the
transaction. Except as set forth in the Exhibits hereto, there are no material
relationships between the Registrant or ULE and either of IBM or IBM Laser
Enterprise.
The Registrant and ULE acquired the certain intellectual property
(non- exclusive technology and patent license agreement) and certain
tangible assets(accounts receivable, fixed assets and inventories).
In addition to the assets, ULE and the Registrant assumed certain
liabilities relating to the Assets. As a part of the transaction, IBM
leased to ULE, for a period of 24 months, approximately 12,000 square
feet of office, cleanroom and laboratories space at the Zurich
Research Laboratory, at no additional consideration. IBM and ULE further
agreed that IBM will provide certain services to ULE for the duration of
the lease periods, also at no additional consideration. All of the
Assets will continue to be used by the Registrant and ULE in
conducting ULE's business, which prior to the completion of the
transaction involved the development, manufacture and sale of integrated
optical components.
The source of funds used to purchase the Assets was cash from the
Registrant's existing working capital.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Businesses Acquired.
It is impractical for Registrant to file the required
financial statements at this time. Registrant intends to
file such financial statements within 60 days of the date of this
report.
(b) Pro Forma Financial Information.
See response to Item 7(a).
(c) Exhibits.
The Exhibit Index appearing on page 4 is incorporated herein
by reference.
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.
UNIPHASE CORPORATION
\s\ Danny E. Pettit
Danny E. Pettit
Vice President of Finance and CFO
Date: March 25, 1997
EXHIBIT INDEX
Sequentially
Exhibit Description Numbered Page
2.1*,+ Purchase Agreement among Uniphase Corporation, 5 - 81
International Business Machines Corporation,and
Uniphase Laser Enterprise AG
2.2+ Technology License Agreement 82 - 105
2.3 Patent License Agreement 106 - 114
2.4 The Agreement for Exchange of Confidential 115 - 118
Information
- ------------------------------------------------------------
* Certain detailed schedules relating to the assets acquired
have been summarized and will be made available to the SEC on request.
+ Certain confidential information has been filed for
redaction with the SEC.
________________________________________________
Purchase Agreement
among
Uniphase Corporation,
International Business Machines Corporation,
and
Uniphase Laser Enterprise AG
__________________________________________________
TABLE OF CONTENTS
ARTICLE I. PURCHASE AND SALE OF ASSETS. 1
Section 1.1. Transferred Assets. 2
Section 1.2. Excluded Assets. 2
Section 1.3. Consideration. 2
Section 1.4. Assumed Liabilities. 2
Section 1.5. Accounts Receivable. 3
ARTICLE II. CLOSING. 3
Section 2.1. Closing Date. 3
Section 2.2. Delivery by Buyer. 3
Section 2.3. Delivery by Seller. 4
ARTICLE III. TAX MATTERS. 5
Section 3.1. Allocation of Purchase Price. 5
Section 3.2. Filing of Returns and Payment of 5
Taxes.
Section 3.3. Refunds and Credits. 6
Section 3.4. Transfer Taxes. 6
Section 3.5. Tax Definitions. 6
ARTICLE IV. OTHER MATTERS. 6
Section 4.1. Consents and Subcontracted Work. 6
Section 4.2. Employees and Employee Benefits. 7
Section 4.3. Leased Property. 9
Section 4.4. Further Action. 9
Section 4.5. Transitional Services Agreement 9
Section 4.6. Liens. 9
Section 4.7. Relocation. 10
Section 4.8. Due Diligence. 10
Section 4.9. Buyer Financial Statements. 10
ARTICLE V. REPRESENTATIONS AND WARRANTIES OF BUYER. 10
Section 5.1. Incorporation. 10
Section 5.2. Authority. 10
Section 5.3. No Conflict. 11
Section 5.4. Governmental Consents - Buyer. 11
Section 5.5. No Broker. 12
ARTICLE VI. REPRESENTATIONS AND WARRANTIES OF 12
SELLER.
Section 6.1. Incorporation. 12
Section 6.2. Authority. 12
Section 6.3. No Conflict. 12
Section 6.4. Governmental Consents - Seller. 13
Section 6.5. No Broker. 13
Section 6.6. Title to Personal Property. 13
Section 6.7. Actions, Suits, Proceedings. 13
Section 6.8. No Rights In Others To Transferred 13
Assets.
Section 6.9. Contracts. 14
Section 6.10. Licenses and Permits. 14
Section 6.11. Employee Union. 14
Section 6.12. Warranties Exclusive. 14
Section 6.13. Book Value. 14
ARTICLE VII. GENERAL. 14
Section 7.1. Survival of Representations and 15
Warranties.
Section 7.2. Limitation of Liability. 14
Section 7.3. Public Announcements. 15
Section 7.4. Costs. 15
Section 7.5. Bulk Sales. 15
Section 7.6. Modification and Waiver. 15
Section 7.7. Governing Law. 16
Section 7.8. Notices. 16
Section 7.9. Assignment. 17
Section 7.10. Counterparts. 17
Section 7.11. Guarantee. 17
Section 7.12. Entire Agreement 17
SCHEDULES
Schedule 1.1. Asset Listing
Schedule 1.1. Production Equipment
Schedule 1.1.B. Office Furniture/Equipment
Schedule 1.1.C. Inventory and Work in Process
Schedule 1.1.D. Accounts Receivable
Schedule 1.4.A.1. Assumed Liabilities
Schedule 1.4.B. Internal Contracts with Seller or
Seller
Schedule 3.1. Allocation of Purchase Price
Schedule 4.1. Consents to Assignments
Schedule 4.2.A. Employees
Schedule 4.2.C. Seller
Schedule 5.4. Governmental Consents - Buyer
Schedule 6.4. Governmental Consents - Seller
Schedule 6.7. Actions, Suits, Proceedings
Schedule 6.10. Licenses and Permits
EXHIBITS
Exhibit A: Assumption Agreement
Exhibit B: Bill of Sale
Exhibit C: Transitional Services Agreement
Exhibit D: Seller Lease
Exhibit E: Pension Matters
PURCHASE AGREEMENT
THIS AGREEMENT, dated as of March 10, 1997, by and between
International Business Machines Corporation, a New York corporation
("Seller"), Uniphase Corporation, a Delaware corporation, and Uniphase
Laser Enterprise AG, a Swiss AG ("Buyer") (herein "Agreement");
W I T N E S S E T H:
WHEREAS, Seller wishes to sell assets used in the manufacturing
of certain components (such assets being hereinafter referred to as the
"Transferred Assets") which business operations are currently conducted at
Seller's facility located at Reuschlikon, Canton Zurich, Switzerland; and
WHEREAS, Buyer wishes to purchase from Seller, and Seller wishes
to sell to Buyer, the Transferred Assets for the purchase price and subject
to the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises set forth above
and the respective covenants, agreements, representations and warranties
hereinafter set forth, Buyer, Seller, and Uniphase Corporation
(collectively, the "Parties") hereby agree as follows:
Article I. Purchase and Sale of Assets.
Section 1.1. Transferred Assets. Upon the terms and
subject to the conditions hereof, as of the Closing Date (as defined in
Article 2.1 hereof), Seller hereby sells, transfers, conveys, assigns and
delivers to Buyer, and Buyer hereby purchases and accepts from Seller, all
right, title and interest of Seller in and to the items of equipment and
office furniture, and assets, including work in progress and accounts
receivable, listed on the sub-schedules of Schedule 1.1 hereto and spare
parts, as available for any of the items listed thereon, but excluding cash
accounts. Intellectual property matters are addressed exclusively in the
Patent License Agreement and Technology License Agreement between the
Parties, dated as of the date of this Agreement (herein the "Intellectual
Property Agreements") and except as provided in Section 7.2. are not
otherwise a subject matter of this Agreement.
All such scheduled assets and Assumed Liabilities (as defined
below) of Seller are collectively referred to herein as the "Transferred
Assets." Wherever used in this Agreement, the term "affiliate" of any
person or entity shall mean any person or entity which is controlling,
controlled by or under common control with such person or entity.
Seller shall also assign applicable third party warranties on the
Transferred Assets, to the extent legally permissible, and without
responsibility for compliance by the warranty grantors.
Section 1.2. Excluded Assets. Notwithstanding anything
to the contrary in this Agreement or any agreements contemplated by this
Agreement, the following assets (collectively, the "Excluded Assets") will
be retained by Seller, and are excluded from the Transferred Assets:
(a) any interest in or right to use any trademark or service
mark owned by Seller or any of its affiliates, any associated logo or any
derivative of any thereof, either alone or in conjunction with other words;
(b) except as set forth in Schedule 1.4.B., any interest in any
contractual arrangement with Seller or any of its affiliates;
(c) all other assets of Seller or any of its affiliates not
expressly listed on Schedule 1.1 hereto; and
(d) except as provided in the Seller Lease (as defined in
Section 2.2(c) below), any interests of Seller or any of its affiliates in
real property.
Section 1.3. Consideration. The Purchase Price for the
Transferred Assets and the licenses granted under the Intellectual Property
Agreements shall be $45,000,000 (forty-five million dollars). Buyer shall
pay to Seller by electronic funds transfer, such sum in immediately
available funds at the Closing, in U.S. dollars.
Section 1.4. Assumed Liabilities.
(a) At the Closing, Seller will assign and transfer to Buyer,
and Buyer will assume, and thereafter shall fully perform and discharge, on
a timely basis and in accordance with their respective terms, the
liabilities and obligations of Seller listed on Schedule 1.4.A.1. and
Schedule 1.4.A.2., hereto (the "Assumed Liabilities"). Without limiting
the generality of the foregoing, except for the Assumed Liabilities and the
Buyer's obligations to the Employees under Swiss law, Buyer is not assuming
or undertaking any obligations or liabilities of Seller, to any assets or
contracts which are not included in the Transferred Assets or the Assumed
Liabilities. Buyer is assuming and undertaking, and Seller shall not
remain liable for, any obligations or liabilities of Seller, contingent or
otherwise, whenever asserted, relating to periods prior to the Closing
Date, and work performed during such periods with respect to the Assumed
Liabilities, as set forth on Schedule 1.4.A.2., and such obligations and
liabilities are specifically included in the Assumed Liabilities. The
Assumed Liabilities shall, except as otherwise set forth herein, exclude
liabilities and obligations of Seller with respect to periods prior to the
Closing Date, including, without limitation, any liabilities or payments
accruing with respect to the Assumed Liabilities for periods prior to the
Closing Date. Any rights, liabilities and obligations of Seller to or from
any of its affiliates will not be transferred to Buyer, other than as set
forth in Schedule 1.4.B.
(b) The Parties will each use reasonable efforts to obtain
written consents to the transfer and assignment to Buyer of the Transferred
Assets and Assumed Liabilities, where the approval or other consent of any
other person may be required. The Parties shall cooperate (including,
where necessary, entering into appropriate instruments of assumption as
shall be agreed upon) to have Seller released from all liability to third
parties with respect to the Assumed Liabilities, and the Parties will each
solicit such releases concurrently with the solicitation of consents from
third parties to the transfer and assignment to Buyer of the Transferred
Assets and the Assumed Liabilities; provided, that, neither Party shall be
required to grant any additional consideration to any third party in order
to obtain any such consent or release.
Section 1.5. Accounts Receivable. The accounts receivable
listed on Schedule 1.5 are part of the Transferred Assets. Such accounts
receivable are transferred subject to collection, with no representations
as to collectibility, or as to any minimum amount to be provided. If such
accounts receivable exceed $5.5 million U.S., Buyer will repay such excess
to Seller within 15 business days of collection and in no event later than
90 days after the date of this Agreement. If Buyer has notified Seller
within such 90-day period that Buyer has determined a portion of such
accounts receivable to be uncollectible, and if some accounts receivable
are deemed to be uncollectible as determined in good faith by both Parties,
the Seller shall receive from the Buyer no later than six months after the
Closing a final balancing payment for such uncollectible receivables; the
remaining accounts receivable transferred above $5.5 million U.S., reduced
by an amount calculated under the following formula: the product of (i)
such uncollectible amounts, divided by the total accounts receivable
transferred at Closing; times (ii) the result of the total accounts
receivable transferred at Closing, less $5.5 million U.S. An exchange rate
of 1.48 Swiss Francs for each U.S. dollar will be applied for those
receivables denominated in Swiss Francs.
Article II. Closing.
Section 2.1. Closing Date. The closing of the
transactions provided for in this Agreement (the "Closing") shall take
place on the date hereof (the "Closing Date") at the offices of Seller.
All transactions provided for herein to occur on and as of the Closing Date
shall be deemed to have occurred simultaneously and to be effective as of
the close of business on the Closing Date.
Section 2.2. Delivery by Buyer. At the Closing, Buyer
will deliver or cause to be delivered to Seller the following:
(a) payment of the Purchase Price in the manner specified in
Article 1.3 hereof;
(b) an Assignment and Assumption Agreement substantially in the
form of Exhibit A hereto (the "Assumption Agreement"), duly executed by
Buyer and assigning the Assumed Liabilities to Buyer;
(c) Laboratory Real Estate Lease in the form of Exhibit D hereto
(the "Seller Lease"), duly executed by Buyer.
(d) Transitional Services Agreement in the form of Exhibit C
hereto, duly executed by Buyer;
(e) an extract from the Swiss Commercial Register of Buyer
certified by the Commercial Register, and a copy of the Certificate of
Incorporation of Uniphase Corporation certified by the Secretary of State
of the State of Delaware; and
(f) a certificate of the Secretary of Uniphase Corporation as to
the By-laws of Uniphase Corporation and the resolutions of Uniphase
Corporation, and a power of attorney of the only member of the board of
directors of Buyer, authorizing the execution, delivery and performance of
this Agreement, the Intellectual Property Agreements, the Seller Lease, the
Assumption Agreement, the Transitional Services Agreement, and the future
Swiss Pension Transfer Agreement by either Buyer or Uniphase Corporation,
as applicable, and the persons acting on behalf of Buyer, executing such
Agreements and any document delivered in connection with such agreements at
the Closing.
Section 2.3. Delivery by Seller. At the Closing, Seller
will deliver or cause to be delivered to Buyer the following:
(a) a bill of sale substantially in the form of Exhibit B hereto
(the "Bill of Sale"), duly executed by Seller, effectively vesting in Buyer
all right, title and interest of Seller in and to the tangible personal
property included in the Transferred Assets as provided in this Agreement;
(b) the Assumption Agreement, duly executed by Seller;
(c) the Seller Lease, duly executed by Seller;
(d) the Transitional Services Agreement, duly executed by
Seller;
(e) a certificate of the Secretary of Seller as to the By-laws
of Seller, and the delegations authorizing the execution, delivery and
performance of this Agreement, the Intellectual Property Agreements, the
Bill of Sale, the Seller Lease, the Assumption Agreement, the Transitional
Services Agreement and the future Swiss Pension Transfer Agreement, and as
to the incumbency of all officers of Seller executing this Agreement and
any document delivered in connection with this Agreement at the Closing.
Article III. Tax Matters.
Section 3.1. Allocation of Purchase Price. Buyer and
Seller agree on an estimated allocation of the Purchase Price as set forth
in Schedule 3.1. to the extent necessary to permit the making of timely
transfer tax filings. In addition, as soon as practicable after the
Closing Date, but in no event not later than 90 days prior to the due date
of the Internal Revenue Service Form 8594, Buyer shall provide to Seller
proposed statements ("Allocation Statements") allocating the total of the
Purchase Price (and other payments properly treated as additional Purchase
Price for Tax purposes) to the different Transferred Assets as set forth in
Schedule 3.1., pursuant to Section 1060 of the Internal Revenue Code of
1986, as amended, and the Treasury Regulations promulgated thereunder
(hereinafter, the "Code"). Seller will agree to Buyer's proposed
Allocation Statements.
Buyer and Seller shall each file all income, franchise and other
Tax Returns (as defined below), and execute such other documents as may be
required by any governmental authority, in a manner consistent with the
Allocation Statements. Buyer shall prepare the Form 8594 under Section
1060 of the Code based on the Allocation Statements and deliver such form
and all documentation used in the preparation and support of such
Allocation Statements and form (including, but not limited to, appraisals)
to the Seller within 30 days after finalization of the Allocation
Statements. The Buyer and the Seller agree to file such form with each
relevant taxing authority and to refrain from taking any position
inconsistent with such form or Allocation Statements.
Notwithstanding the above provision, Buyer agrees to indemnify
and hold Seller harmless from and against any and all liability for Taxes
resulting from any reallocation of the Purchase Price that differs from the
estimated allocation as set forth in Schedule 3.1. For purposes of
calculating the amount of any Taxes in the preceding sentence, it shall be
assumed that such Taxes are payable at the highest effective statutory
corporate income tax rates that could apply to Seller, as applicable, for
the relevant period.
Section 3.2. Filing of Returns and Payment of Taxes.
Seller shall prepare and file, or cause to be prepared and filed, with the
appropriate authorities all Tax (as defined below) returns, reports and
forms (herein "Tax Returns") and shall pay, or cause to be paid, when due
all Taxes relating to the Transferred Assets attributable to any taxable
period which ends on or prior to the Closing Date (herein "Pre-Closing Tax
Period"). Buyer shall prepare and file, or cause to be prepared and filed,
with the appropriate authorities all Tax Returns, and shall pay, or cause
to be paid, when due all Taxes relating to the Transferred Assets
attributable to the period which is not part of the Pre-Closing Tax Period.
If, in order to properly prepare its Tax Returns or other documents
required to be filed with governmental authorities, it is necessary that a
party be furnished with additional information, documents or records
relating to the Transferred Assets, both Seller and Buyer agree to use
reasonable efforts to furnish or make available such information at the
recipient's request, cost and expense provided, however, that no party
shall be entitled to review or examine the Tax Returns of any other party.
Section 3.3. Refunds and Credits.
Any refunds and credits attributable to the Pre-Closing Tax
Period shall be for the account of the Seller and any refunds and credits
attributable to the period which is not part of the Pre-Closing Tax Period
are for the account of the Buyer.
Section 3.4. Transfer Taxes.
All transfer, documentary, sales, use, registration, value-added
taxes and any similar taxes (including real estate transfer taxes) incurred
in connection with this Agreement and the transactions contemplated hereby
shall be borne by Buyer, in addition to the consideration in Section 1.3.
To the extent legally able to do so, Buyer and Seller shall cooperate with
each other to obtain exemptions from such taxes, including the value added
tax and the preparation of necessary documentation, provided that neither
party shall be obligated to seek any exemption that would require any
governmental audit of its books and records.
Section 3.5. Tax Definitions.
For purposes of this Agreement, "Tax or Taxes" means all taxes,
imposts, duties, withholdings, charges, fees, levies, or other assessments
imposed by any governmental or taxing authority, whether domestic or
foreign, including but not limited to, income, gross receipts, excise,
property, sales, use, transfer, conveyance, payroll or other employment
related, license, ad valorem, value added, withholding, social security,
national insurance (or other similar contributions or payments), franchise,
estimated severance, stamp taxes, taxes based upon capital stock or net
worth and other taxes (including interest, fines, penalties, or additions
attributable to or imposed on or with respect to, any such taxes, charges,
fees levies or other assessments).
Article IV. Other Matters.
Section 4.1. Consents and Subcontracted Work. Seller and
Buyer shall use reasonable efforts to obtain, in a reasonable amount of
time and no later than four months after the Closing Date unless
impractical, all requisite consents to assignments and novations, as the
case may be, of all of the Transferred Assets and the Assumed Liabilities.
The Parties will cooperate and use reasonable efforts in obtaining such
consents and novations in accordance with the provisions of this Agreement.
The material consents to assignment that have been identified at this time
are listed on Schedule 4.1. If any such required consents cannot be
secured without the incurring of any significant additional costs, the
Parties shall enter into such other arrangements with respect to the
underlying rights and obligations as shall permit Buyer to perform the
obligations of Seller thereunder, as a subcontractor or otherwise, and
Buyer to obtain the sole benefit thereof (the "Subcontracted Work"); and
until the requisite consents are obtained, such obligations shall not be
deemed to be included in the Assumed Liabilities and nothing contained
herein shall be deemed to constitute a breach of the contract underlying
such rights and obligations. Buyer agrees to diligently perform and
discharge the obligations of Seller in connection with the Subcontracted
Work; and if and to the extent that consents to assignment are obtained
after the Closing Date, Buyer agrees that such obligations shall no longer
be considered to be Subcontracted Work, but shall instead be deemed to be
Assumed Liabilities for all purposes of this Agreement.
The Seller hereby transfers to the extent it has the legal right
to do so and subject to the applicable license agreements with the
licensors, its royalty-free usage rights to the shrink-wrap personal
computer software (also known as conditions of use software) being used in
the normal course of the Seller's Zurich laser chip production by the
Employees, if such software is installed as of March 7, 1997 on the
computers which are among the Transferred Assets. If such software
copyrights are owned by the Seller, Seller's license terms and conditions
continue to apply.
Section 4.2. Employees and Employee Benefits.
(a) Schedule 4.2.A. contains a list of some of the individuals
employed by the Seller at the date hereof (including active employees and
employees who are on leave of absence; sick leave or disability leave)
(herein the "Employees").
(b) The employment relations of the Employees are assumed by the
Buyer, together with all rights and obligations, from the date of the
Closing.
(c) The Buyer agrees to use reasonable efforts to provide
comparable benefits. It being understood that the Buyer may not be in a
position to provide all the ancillary benefits currently provided by the
Seller to the Employees. The Buyer has knowledge of the Seller's Swiss
Staff Member Manual. The Seller and the Buyer shall comply with their
respective obligations under Article 333 of the Swiss Code of Obligations.
However, the Seller shall not continue to provide or ensure these benefits
after the Closing Date to the Buyer's Employees. The Buyer assumes all
liabilities for the failure to perform. The Buyer shall provide for the
appropriate amendments in the employment agreements.
(d) The Buyer agrees as promptly as is practicable from the
Closing Date to establish a new defined occupational pension plan (the
"Buyer's Plan") to provide the transferred Employees with pension benefits
that are at least substantially comparable with the benefits that are
provided to such Employees under the Seller's two pension benefit plans
according to Exhibit E. The Buyer's Plan shall provide for the
participation of such Employees therein as of the Closing Date, and provide
that in applying any length of service requirement for participation or
vesting and in determining the benefits, each such Employee shall be
credited with prior service as shown in the records of the Seller,
according to the Seller's rules for service credit, and with the eligible
compensation under the Seller's plan's during the period. The Seller shall
provide the Buyer the documents listed in schedules to Exhibit E to
establish and administer the Buyer's plan with respect to each Employee's
pension benefits, eligible compensation and service prior to the Closing
Date.
(e) For the free movement of capital between the pension funds
and for the partial liquidation of a pension fund the Parties agree to
comply with the Free Movement Statue (Freizugigkeitsgesetz). The assets
shall be calculated according to the Swiss law (BVG and FZG). According to
Article 23 (1) of the FZG, the plan of distribution shall be approved by
the official supervisory body.
(f) These pension provisions are more fully set forth in Pension
Matters, Exhibit E and its schedules and attachments. Upon transfer of the
Transferred Pension Assets (as defined in Exhibit E) to the Buyer's Plan
(as defined in Exhibit E) the Buyer's Plan shall assume all liabilities of
the Seller's Plans for the pension benefits for the Employees and such
transfer shall be in full discharge of all obligations of the Seller's
Plans for the pension benefits.
(g) Buyer shall be responsible for liabilities with respect to
all employment matters concerning the employment of the Employees after the
Closing, including the termination of any Employees by Buyer after the
Closing and damages or settlements arising out of any claims of wrongful or
illegal termination, and for complying with the requirements of all
applicable laws with respect to any such termination.
(h) Buyer agrees to employ the Employees in the Zurich,
Switzerland area, utilizing the Transferred Assets, for at least twenty-
four months following the Closing.
(i) For three years from the date of this Agreement, Seller will
not solicit for employment or employ in any capacity any individual who,
within 12 months prior to the date of new hire, has been an Employee
transferred as part of this Agreement. For three years from the date of
this Agreement, Buyer shall not solicit for employment or employ in any
capacity any individual who, within 12 months prior to the date of new
hire, has been an employee of Seller or its Affiliates working or employed
at Seller's Zurich laboratory, other than Employees.
(j) Buyer shall be responsible for obtaining any necessary work
permits for any Employee required under applicable law, as of and after the
Closing. Seller shall reasonably cooperate with Buyer on such matters.
Seller will provide Buyer with a letter which describes the transfer of the
Employees in the form as has been agreed between the Swiss counsel of the
Seller and Buyer on the Closing Date.
(k) Subject to the Employees' employment agreements or the terms
of any new employment contract between such Employees and Buyer, and
applicable law, the Buyer retains its right to terminate any Employee for
cause. Nothing in this Agreement shall be deemed to convey any rights to
any Employee as a third party beneficiary of any obligation of Buyer to
Seller hereunder.
Section 4.3. Leased Property. The Swiss representatives
of the Buyer and the Seller have negotiated a Seller Lease in the form of
Exhibit D, under Swiss law, for the lease to Buyer from Seller of real
estate following the Closing.
Section 4.4. Further Action. Each of the Parties agrees
to execute and deliver after the Closing Date such other documents,
certificates, agreements and other writings and to take such other actions
as may be necessary, in the opinion of counsel, in order to consummate or
implement expeditiously the transactions contemplated hereby. In addition,
Seller agrees, promptly upon the request of Buyer, and at no additional
expense to Seller, other than the expenses associated with the preparation
of appropriate instruments of assignment, to take all actions reasonably
requested by Buyer to perfect the transfer to Buyer of the Transferred
Assets. The March 1997 payroll for Employees will be paid to the Employees
by Seller under its standard Swiss monthly payroll system. No later than
April 30, 1997, Buyer will pay Seller's invoice for Buyer's proportionate
share of the March payroll, including any applicable social security,
pension plan contributions, and similar sums. Buyer's invoiced payment will
equal a sum calculated by multiplying the total monthly payroll for the
Employees by a fraction, (1) the numerator of which will be the number of
days remaining in March after the Closing Date and (2) the denominator of
which will be 31. (Hypothetically, if the Closing Date is March 10, the
fraction would be 21/31). Seller shall be responsible for all accrued,
unused vacation through March 10,1997, with respect to the Employees and
shall pay to Buyer on or prior to March 30,1997, an amount equal to the
value of Seller's salary due for such accrued unused vacation.
Section 4.5. Transitional Services Agreement. The Swiss
representatives of the Buyer and the Seller have negotiated a Transitional
Services Agreement in the form of Exhibit C, under Swiss law, to handle
services to be provided to the Buyer by the Seller after the Closing.
Section 4.6. Liens. Within thirty days after notice to
Seller of attachment, Seller shall clear all material title liens or
encumbrances upon title attaching to the Transferred Assets after the
Closing Date which arise due to acts or failures to act of Seller prior to
or on the Closing Date. If Seller is unable to clear all material title
liens or encumbrances upon title within thirty (30) days after notice,
Seller shall complete any action necessary to provide Buyer with materially
unencumbered title to the Transferred Assets. In the event that Seller
shall fail to take such action within the time periods specified in this
Section 4.6, to clear such liens and encumbrances under Swiss law, Buyer
shall have the right to take such action as it deems reasonably necessary
to clear such liens or encumbrances upon title and to obtain reimbursement
for its out-of-pocket costs, plus interest at the simple rate of 10% per
annum, from Seller.
Section 4.7. Relocation. The Buyer and Seller agree that
the Transferred Assets are being prepared and positioned for a sale and a
physical relocation out of their current facilities. No representations or
characterizations as to the Seller's ordinary course of business, the
maintenance condition or operation of the Transferred Assets or the results
to be obtained from those assets are being made.
Section 4.8. Due Diligence. This sale includes the
transfer, by operation of and subject to Swiss law, of the Employees,
performing substantially the same work as that being performed by those
employees for the Seller. The Buyer has engaged in such due diligence
effort as it has deemed appropriate prior to signing this Agreement. The
sale of the Transferred Assets is based upon the results of that due
diligence and there has been no reliance upon the representations or
statements of Seller, to Uniphase Corporation or Buyer, other than the
written representations set forth in the Seller's representations in
Article VI of this Agreement, or in the Intellectual Property Agreements,
the Transitional Services Agreement or the Seller Lease.
Section 4.9. Buyer Financial Statements. Seller will
cooperate with Buyer and Buyer's auditors to permit Buyer and Buyer's
auditors to timely prepare and file financial statements relating to the
Transferred Assets, prepared by the Buyer in accordance with United States
generally accepted accounting principles and the rules and regulations of
the Securities and Exchange Commission.
Article V. Representations and Warranties of Buyer.
Buyer hereby represents and warrants to Seller as follows:
Section 5.1. Incorporation. Buyer is a duly incorporated
and validly existing corporation under the laws of Switzerland, with all
requisite corporate power and authority to own its properties and conduct
its business.
Section 5.2. Authority. Buyer has the requisite
corporate power and authority to execute and deliver each of this
Agreement, the Intellectual Property Agreements, the Seller Lease and
Assumption Agreement, and the Transitional Services Agreement, and to
perform its obligations under each of the foregoing. Each of this
Agreement, the Intellectual Property Agreements, the Seller Lease and
Assumption Agreement, and the Transitional Services Agreement, has been
duly and validly authorized, executed and delivered by Buyer and
constitutes the valid and binding agreement of Buyer in accordance with its
respective terms. No other corporate proceedings on the part of Buyer are
necessary to authorize this Agreement, the Intellectual Property
Agreements, the Seller Lease and Assumption Agreement, and the Transitional
Services Agreement and the transactions contemplated by any of the
foregoing.
Section 5.3. No Conflict. The execution and delivery by
Buyer of each of this Agreement, the Intellectual Property Agreements, the
Seller Lease, the Assumption Agreement, and the Transitional Services
Agreement, does not, and the performance of its obligations hereunder and
thereunder, will not:
(a) conflict with, or result in a breach of, any of the
provisions of its Certification of Incorporation or By-Laws;
(b) breach, violate or contravene any applicable law, rule or
regulation of any state or of the United States or any political
subdivision thereof or of Switzerland or any political subdivision thereof,
or any order, writ, judgment, injunction, decree, determination or award,
or create any right of termination or acceleration or encumbrance that in
the aggregate would have a material adverse effect on its authority or
ability to perform either its obligations under this Agreement, the
Intellectual Property Agreements, the Seller Lease, the Assumption
Agreement , the Transitional Services Agreement or the Assumed Liabilities;
or
(c) conflict in any respect with, or result in a breach of or
default under, any contract, license, franchise, permit or any other
agreement or instrument to which it is a party or by which it or any of its
properties may be affected or bound that in the aggregate would have a
material adverse effect on its authority or ability to perform its
obligations under this Agreement, the Intellectual Property Agreements, the
Seller Lease, the Assumption Agreement, or the Transitional Services
Agreement.
Section 5.4. Governmental Consents - Buyer. Other than as
set forth on Schedule 5.4., no material consent, approval or authorization
of, or designation, declaration or filing with, any governmental agency or
authority on the part of Buyer is required in connection with the execution
or delivery by Buyer of this Agreement, the Intellectual Property
Agreements, the Seller Lease, the Assumption Agreement, and the
Transitional Services Agreement or the consummation by Buyer of the
transactions contemplated by any of the foregoing, other than the
authorization in connection with the Seller Lease, according to the Swiss
Lex Friedrich to be obtained by Seller, and other than the authorization of
the competent authorities with respect to the transfer of the foreign
Employees having work permits from Seller to Buyer, to be obtained by Buyer
and other than the future Swiss Pension Transfer Agreement and the fact
that Uniphase Corporation has formed Buyer in Switzerland to utilize the
Transferred Assets, which will require a filing in the Swiss Commercial
Register.
Section 5.5. No Broker. Buyer and Uniphase Corporation
have engaged no corporation, firm or other person who is entitled to any
fee or commission as a finder or a broker in connection with the
negotiation of this Agreement or the consummation of the transactions
contemplated hereby, and Buyer shall be responsible for all liabilities and
claims (including costs and expenses of defending against same) arising in
connection with any claim by a finder or broker that it acted on behalf of
Buyer or Uniphase Corporation in connection with the transactions
contemplated hereby.
Article VI. Representations and Warranties of Seller.
Seller hereby represents and warrants to Buyer as follows:
Section 6.1. Incorporation. Seller is a duly incorporated
and validly existing corporation in good standing under the laws of the
State of New York, with all requisite corporate power and authority to own
its properties and conduct its business, and is duly qualified in each
jurisdiction in which its ownership of property requires such qualification
except where the failure to so qualify would not have a material adverse
effect upon the Transferred Assets or the ability of Seller to perform its
obligations hereunder.
Section 6.2. Authority. Seller has the requisite
corporate power and authority to execute and deliver this Agreement, the
Seller Lease and Assumption Agreement, the Bill of Sale, the Transitional
Services Agreement and the Intellectual Property Agreements, and to perform
its obligations under each of the foregoing. Each of this Agreement, the
Seller Lease and Assumption Agreement, the Bill of Sale, the Transitional
Services Agreement, and the Intellectual Property Agreements, has been duly
and validly authorized, executed and delivered by Seller and constitutes
the valid and binding agreement of Seller in accordance with its respective
terms. No other corporate proceedings on the part of Seller are necessary
to authorize this Agreement, the Intellectual Property Agreements, the
Seller Lease and Assumption Agreement, the Bill of Sale, and the
Transitional Services Agreement, and the transactions contemplated by any
of the foregoing.
Section 6.3. No Conflict. The execution and delivery by
Seller of this Agreement, the Intellectual Property Agreements, the Seller
Lease and Assumption Agreement, the Bill of Sale, and the Transitional
Services Agreement does not, and the performance by Seller of its
obligations hereunder and thereunder will not:
(a) conflict with, or result in a breach of, any of the
provisions of its Certificate of Incorporation or By-Laws;
(b) breach, violate or contravene any applicable law, rule or
regulation of the United States or any political subdivision thereof, or
Switzerland or any political subdivision thereof, or any order, writ,
judgment, injunction, decree, determination or award, or create any right
of termination or acceleration or encumbrance that, in the aggregate would
have a material adverse effect on the Transferred Assets; or
(c) conflict in any respect with, or result in a breach of or
default under, any contract, license, franchise, permit or any other
agreement or instrument to which Seller is a party or by which it or any of
the Transferred Assets may be bound that in the aggregate would have a
material adverse effect on the Transferred Assets (except for agreements
and instruments that require the consent or approval of a third party for
the transactions contemplated by this Agreement).
Section 6.4. Governmental Consents - Seller. Other than
as set forth on Schedule 6.4, no material consent, approval or
authorization of, or designation, declaration or filing with, any
governmental agency or authority on the part of Seller is required in
connection with the execution or delivery by Seller of this Agreement, the
Intellectual Property Agreements, the Seller Lease, the Assumption
Agreement, the Bill of Sale, or Transitional Services Agreement or the
consummation by Seller of the transactions contemplated by any of the
foregoing other than the authorization in connection with the Seller Lease,
according to the Swiss Lex Friedrich to be obtained and other than the
future Swiss Pension Transfer Agreement.
Section 6.5. No Broker. Seller has engaged no
corporation, firm or other person who is entitled to any fee or commission
as a finder or a broker in connection with the negotiation of this
Agreement or the consummation of the transactions contemplated hereby, and
Seller shall be responsible for all liabilities and claims (including costs
and expenses of defending against same) arising in connection with any
claim by a finder or broker that it acted on behalf of Seller in connection
with the transactions contemplated hereby.
Section 6.6. Title to Personal Property. Seller has good
and marketable title to all tangible personal property listed on Schedules
1.1.A., 1.1.B., 1.1.C., hereto, free and clear of any material liens or
encumbrances.
Section 6.7. Actions, Suits, Proceedings. Other than as
set forth on Schedule 6.7, there are no actions, suits, or proceedings
pending or, to Seller's knowledge, threatened against the Transferred
Assets, at law or in equity, including any administrative proceedings with
any regulatory authority; and no third party claims have been asserted
against Seller or its affiliates with respect to the Transferred Assets.
There is no existing default by Seller or, to the knowledge of Seller, any
of its affiliates with respect to any judgment, order, writ, injunction or
decree of any governmental authority or arbitrator which materially
adversely affects the Transferred Assets.
Section 6.8. No Rights In Others To Transferred Assets.
Neither Seller nor any affiliate of Seller is party to any outstanding
contracts or other arrangements giving any person any present or future
right to require Seller to transfer to any person any ownership or
possessory interest in, or to grant any lien on, any of the Transferred
Assets, other than pursuant to this Agreement.
Section 6.9. Contracts. Schedule 1.4.A. contains a true
and complete list of all material customer or vendor contracts constituting
the Transferred Assets. Seller has performed or is performing all material
obligations required to be performed by it under such contracts and is not
(with or without notice, lapse of time or both) in breach or default in any
material respect thereunder; and, to the knowledge of Seller, no other
party to any of such contracts is (with or without notice of time or both)
in breach or default in any material respect thereunder.
Section 6.10. Licenses and Permits. Seller or its
affiliates have the licenses and permits and other governmental
authorizations and approvals as set forth on Schedule 6.10. All such
licenses and permits held by Seller which are material to the use of the
Transferred Assets are valid and in full force and effect. Buyer has made
its own investigation of such matters and is responsible for obtaining such
regulatory approvals for its operations after the Closing. To the personal
knowledge of the four most senior level executives among the Employees, as
expressed to the Buyer prior to the signing of this Agreement during due
diligence, they do not believe the operation of the Transferred Assets, as
operated by the Seller immediately prior to the date of this Agreement,
violated any applicable law.
Section 6.11. Employee Union. No union organizing
activities are in progress or, to Seller's knowledge, threatened at
Seller's facilities concerning the Employees.
Section 6.12. Exclusive Warranties. Except for the
express representations and warranties made by Seller in this Article VI,
Seller makes no representation or warranty, express or implied, concerning
the Transferred Assets, it being specifically understood by Buyer that,
except for the express warranties set forth in this Article VI, the
Transferred Assets are being sold "AS IS" in all respects. SELLER
SPECIFICALLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY OR SUITABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE OF BUYER'S, WHETHER OR NOT SELLER HAS
BEEN MADE AWARE OF ANY SUCH PURPOSE. SELLER SHALL NOT BE RESPONSIBLE FOR
ANY INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OF BUYER WHATSOEVER,
INCLUDING LOSS OF PROFITS OR GOODWILL, IN CONNECTION WITH THIS TRANSACTION.
Section 6.13. Book Value. Seller makes no representations
or warranties as to the book value, for tax or for accounting purposes, of
any of the Transferred Assets.
Article VII. General.
Section 7.1. Survival of Representations and Warranties.
All representations and warranties made by the Parties in this Agreement or
any agreement contemplated by this Agreement shall survive the Closing for
a period of twenty-four (24) months after the Closing Date, provided, that,
the representations and warranties in respect of Taxes shall survive the
Closing Date until the applicable period of limitation on assessment or
refund of any relevant Tax has expired.
Section 7.2. Limitation of Liability. Unless the
application of this Section is specifically excluded in writing,
notwithstanding anything to the contrary set forth in this Agreement, the
Bill of Sale, the Seller Lease, the Assumption Agreement, the Transitional
Services Agreement, or the Intellectual Property Agreements, Seller shall
not be liable hereunder or thereunder for any amounts with respect to the
breach of a representation and warranty unless and until such amounts shall
exceed in the aggregate amount $250,000 (the "Limitation Amount"), in which
case Seller shall only be liable with respect to the excess over the
Limitation Amount. In addition, in no event shall Seller's liability with
respect to the breach of representations and warranties exceed $11,000,000
in the aggregate.
Section 7.3. Public Announcements. Under Article 181(2)
of the Swiss Code of Obligations the Seller may be jointly and severally
liable to third parties for its transferred business activities for two
years from a notification or publication date of this transaction following
the Closing. The Parties shall each individually have the right to decide
whether to publicize the transaction of the assets and/or to inform
personally or by circular letter the relevant creditors, customers and
vendors. Any disclosures in connection with commercial relationships shall
not reveal the Purchase Price of this Agreement. Notwithstanding the
foregoing, each Party shall have the right, in its sole discretion, to make
such disclosures as it may deem necessary or advisable to any governmental
agencies or instrumentalities or regulatory bodies.
Section 7.4. Costs. Each Party shall be responsible for
the costs and expenses incurred by it in the negotiation, execution and
delivery of this Agreement and, except as otherwise provided elsewhere in
this Agreement, the consummation of the transactions contemplated hereby.
Section 7.5. Bulk Sales. Buyer and Uniphase Corporation
hereby waive compliance with any applicable bulk sales or similar laws in
the United States or Swiss jurisdictions. Buyer intends to discharge the
Assumed Liabilities in accordance with their terms and the Buyer agrees
that the Seller shall have no liability for any failure of Buyer to
discharge the Assumed Liabilities in accordance with their terms.
Section 7.6. Modification and Waiver. No modification or
waiver of any provision of this Agreement and no consent by any Party
hereto to any departure therefrom shall be effective unless in a writing
referencing the particular article of this Agreement to be modified or
waived and signed by a duly authorized officer of each Party, and the same
will only then be effective for the period and on the conditions and for
the specific instances and purposes specified in such writing.
Section 7.7. Governing Law. This Agreement has been
delivered at and shall be deemed to have been made at Armonk, New York, and
shall be interpreted, and the rights and liabilities of the parties hereto
determined, in accordance with the laws of the State of New York applicable
to agreements executed, delivered and performed within such State, without
regard to the principles of conflicts of laws thereof, provided, however,
that the Parties agree to apply and comply with all mandatory provisions of
the laws of Switzerland applicable to this transaction as a matter of Swiss
public policy, which provisions are applicable regardless of the Parties
choice of law.
As part of the consideration for value this day received, each of
the Parties hereby consents to the jurisdiction of any state or federal
court located within the county of Westchester in the State of New York.
Each of the Parties hereby: (i) waives trial by jury, (ii) waives any
objection to venue of any action instituted hereunder and (iii) consents to
the granting of such legal or equitable relief as is deemed appropriate by
any aforementioned court. These consents and waivers apply to all the
agreements contemplated by this Agreement.
Section 7.8. Notices. All notices and other
communications hereunder shall be in writing and shall be deemed to have
been duly given and shall be effective (a) when delivered by messenger or
courier, or (b) five days after deposit for mailing by registered or
certified mail, postage prepaid, return receipt requested, when also
transmitted by telecopy, as follows:
(a) if to Seller, to:
International Business Machines Corporation
Old Orchard Road
Armonk, New York 10504
Attention: Paul L. Sterne
with a copy to:
Gregory C. Bomberger, Esq.
(b) if to Buyer or Uniphase Corporation, one copy to:
Uniphase Laser Enterprise AG
c/o Uniphase Corporation
163 Baypoint Parkway
San Jose, California 95134
Attention: Dan E. Pettit
with a copy to:
Morrison & Foerster, LLP
755 Page Mill Road
Palo Alto, California 94304
Attention: Michael E. Phillips, Esq.
or to such person or address as either of the parties shall hereafter
designate to the other from time to time by similar written notice.
Section 7.9. Assignment. This Agreement shall be binding
upon, and inure to the benefit of, and be enforceable by, the successors
and assigns of the Parties; provided, that, no Party may assign its rights
hereunder without the written consent of the other Party.
Section 7.10. Counterparts. This Agreement may be
executed by the Parties hereto in one or more counterparts, each of which
shall be an original and all of which shall constitute one and the same
instrument.
Section 7.11. Guarantee. Uniphase Corporation hereby
guarantees the performance, as and when due, by the Buyer of all Buyer
obligations under this Agreement, the Patent License Agreement, the
Technology License Agreement, the Seller Lease, the Agreement for Exchange
of Confidential Information between Buyer and Seller signed March 10,1997,
and the Transitional Services Agreement referenced herein, including,
without limitation, the payment by the Buyer of the consideration set forth
in Section 1.3. of this Agreement and all amounts payable by Buyer under
the other documents referenced above.
Section 7.12. Entire Agreement. This Agreement (including
its schedules and exhibits), together with the Patent License Agreement,
the Technology License Agreement, the Transitional Services Agreement, and
the Seller Lease, all dated the same date hereof, by and among the Seller
and either Uniphase Corporation or the Buyer, and the Confidentiality and
Nondisclosure Agreement, dated November 22, 1996, between Uniphase
Corporation and Seller, comprise the entire agreement between the Parties
with respect to the subject matter hereof and supersede all prior
agreements, understandings and representations, oral or written, between
Seller, Buyer, and Uniphase Corporation relating hereto.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date and year first
above written.
UNIPHASE CORPORATION INTERNATIONAL BUSINESS
MACHINES CORPORATION
By: \s\ Danny E. Pettit By: \s\ Suzanne C. Lewis
Title: Vice President, Finance and CFO Title: Business Development
Consultant
Uniphase Laser Enterprise AG
By: \s\ Danny E. Pettit
Title: Vice President, Finance and CFO
SCHEDULES
Schedule 1.1. Asset Listing
Schedule 1.1. is comprised entirely of the following
Schedules:
1.1.A.
1.1.B.
1.1.C.
1.1.D.
Schedule 1.1.A. Production Equipment
Schedule 1.1.B. Office Furniture/Equipment
Schedule 1.1.C. Inventory and Work in Process
Schedule 1.1.D. Accounts Receivable Report
Schedule 1.4.A.1. Assumed Liabilities
Schedule 1.4.A.2. Assumed Liabilities
Schedule 1.4.B. Internal Contracts with Seller or Seller's affiliates
that will be transferred to Buyer
Schedule 3.1. Allocation of Purchase Price
Schedule 4.1. Consents to Assignments
Schedule 4.2.A. Employees
Schedule 4.2.C. Seller's Swiss Staff Member Manual
Schedule 6.7. Actions, Suits, Proceedings
Schedule 6.10. Licenses and Permits
Exhibit A: Assumption Agreement
Exhibit B: Bill of Sale
Exhibit C: Transitional Services Agreement
Exhibit D: Seller Lease
Exhibit E: Pension Matters
Schedule 1.1.A Production Equipment and
Schedule 1.1.B Office Furniture/Equipment
These schedules contain a detailed description of each of the assets
including furniture, production equipment and computer equipment acquired
for the operations of Uniphase Laser Enterprise.
Schedule 1.1.C Inventory and Work in Progress
This schedule contains the number of chips in inventory as of the
close date.
Schedule 1.1.D Accounts Receivable Report.
The schedule contains a detail listing of aged accounts receivable by
customers for a total amount of $7.0 million as of the close date.
Schedule 1.4.A.1 Assumed Liabilities - Contracts
The schedule contains a listing of contracts for services and
agreements assumed as of the close date.
Schedule 1.4.A.2 Assumed Liabilities
A detailed listing of capital services, and materials ordered but not
received that have been assumed as of the close date.
Schedule 1.4.B Internal Contracts with Seller or Seller's affiliates that
will be transferred to Buyer.
A listing of IBM contracts that were transferred to the buyer as of
the close date.
Schedule 3.1 Allocation of Purchase Price
An allocated schedule of the assets acquired as of the close date.
Schedule 4.1 Consent to Assignments
A listing of contracts that require the consent of a third party to be
transferred or terminated/novated to/with Buyer.
Schedule 4.2.A Employees
A listing of employees in Uniphase Laser Enterpriseas of the closed
date.
Schedule 4.2.C Seller's Swiss Staff Member Manual
A copy of the Swiss Staff Member Manual.
Schedule 6.4 Government Consents - Seller
A listing of governmental consents.
Schedule 6.7 Actions, Suits, Proceedings
There are no actions, suits, or proceedings to report.
Schedule 6.10 Licenses and Permits
A listing of licenses and permits which are material to the use of the
Transferred Assets.
ASSIGNMENT AND ASSUMPTION AGREEMENT
dated as of March 10, 1997 (this "Agreement"), between
UNIPHASE LASER ENTERPRISE AG, a Swiss AG ("Buyer"), and
INTERNATIONAL BUSINESS MACHINES CORPORATION,
a New York corporation ("Seller").
WHEREAS Buyer, Seller and Uniphase Corporation have entered into
a Purchase Agreement dated as of March 10, 1997 (the "Purchase Agreement"),
providing for, among other things, the purchase by Buyer of the Transferred
Assets from Seller; and
WHEREAS, in conjunction with such purchase, Seller desires to
sell, transfer, convey, assign and deliver to Buyer all of Seller's rights,
title and interest in and to the Assumed Liabilities, which form part of
the Transferred Assets.
NOW, THEREFORE, in consideration of the mutual convenants and
undertakings contained herein, and subject to and on the terms and
conditions herein set forth, the parties hereto agree as follows:
1. Defined Terms. Terms defined in the text of this Agreement
shall have such meaning throughout this Agreement.
2. Other Terms. All capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Purchase Agreement.
Nothing contained herein shall be deemed to alter or amend the terms and
provisions of the Purchase Agreement, and in the event of any conflict
between the terms and provisions of this Agreement and the Purchase
Agreement, the terms and provisions of the Purchase Agreement shall be
deemed to govern and be controlling in all circumstances.
3. Assignment. Seller hereby irrevocably sells, transfers,
conveys, assigns and delivers to Buyer all of its right, title and interest
in and to the Assumed Liabilities.
4. Assumption. Buyer does hereby accept such sale, transfer,
conveyance, assignment and delivery of all of seller's right, title and
interest in and to the Assumed Liabilities by Seller and, subject to the
terms of Section 1.4 of the Purchase Agreement, assumes all obligations and
liabilities of Seller thereunder.
5. Effective time. The assignment by Seller, and the
acceptance thereof by Buyer, of the Assumed Liabilities, pursuant to this
Agreement, shall be effective as of the date hereof.
6. Noncontravention. Pursuant to Section 4.1 of the Purchase
Agreement, certain of the Assumed Liabilities may require the consent of
third parties to any assignment. Such assignments to Buyer are made
subject to the obtaining of such consents and shall be effective as of the
date of such consent. The execution of this Agreement shall not be
interpreted, and is not intended to be interpreted, as any action taken by
Seller that would be contrary to the terms and conditions of any contract
requiring the consent of any third party to such assignment. Buyer and
Seller shall fully cooperate with each other in an attempt to obtain such
consents, as set forth in the Purchase Agreement.
7. Notices. All notices and other communications hereunder
shall be as set forth in the Purchase Agreement.
8. Amendment. This Agreement may be amended, modified or
supplemented, and any provision hereof may be waived, only by written
agreement of the parties hereto.
9. Headings. The headings contained in this Agreement are for
reference purposes only and shall not limit or otherwise affect the meaning
or interpretation of this Agreement.
10. Governing Law. This Agreement shall be construed and
enforced in accordance with, and the rights of the parties shall be
governed by, the laws of the State of New York without reference to its
principles of conflict of law.
11. Severability. If any one or more provisions contained in
this Agreement, or the application of such provision to any person or
circumstance, shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision hereof, and this
Agreement shall be construed as if such invalid, illegal or unenforceable
provision had never been contained herein.
12. Third Party Actions. Seller and Buyer hereby agree to
cooperate in defending or prosecuting any claims or litigation relating to
the transfer of title as provided herein, and to make available and furnish
appropriate documents and testimony in connection therewith.
13. Seller's Obligations. Seller hereby covenants and agrees to
execute and deliver all such other further instruments of conveyance,
assignment and transfer and all such other notices, releases, acquittance,
powers of attorney and other documents, and do all such other acts and
things as may be necessary to more fully convey and assign to buyer, or its
successors or assigns, all right, title and interest in and to the Assumed
Liabilities conveyed, assigned and transferred to or acquired by Buyer
pursuant to this Agreement, including, without limitation, filings with any
governmental entity, authority or instrumentality, domestic or foreign.
14. Assignment. Pursuant to Section 7.9 of the Purchase
Agreement neither this Agreement nor any of the rights or obligations
hereunder shall be assigned by either party hereto without the prior
written consent of the other party, such consent not to be unreasonably
withheld, except that Buyer may assign any or all of its rights and
obligations hereunder to one or more Affiliates. Any purported assignment
of this Agreement other than in accordance with this paragraph 17 shall be
null and void and of not force or effect.
18. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument and shall become a
binding Agreement when one or more of the counterparts have been signed by
each of the parties and delivered to the other party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the
day and year first above written.
UNIPHASE LASER ENTERPISE AG
by: \s\ Danny E. Pettit
Title: Vice President, Finance and CFO
INTERNATIONAL BUSINESS
MACHINES CORPORATION
by: \s\ Suzanne C. Lewis
Title: Business Development Consultant
BILL OF SALE
Bill of Sale and Assignment (this "Bill of Sale") dated as of
March 10, 1997 , between International
Business Machines Corporation, a New York corporation ("Seller"),
and Uniphase Laser Enterprise AG, a Swiss AG ("Buyer").
Buyer, Seller, and Uniphase Corporation, a Delaware corporation,
have entered into a Purchase Agreement dated as of March 10, 1997 (the
"Purchase Agreement"), for the sale by Seller to Buyer of certain
Transferred Assets as described in the Purchase Agreement. All capitalized
terms not otherwise defined herein shall have the respective meanings
provided in the Purchase Agreement.
NOW THEREFORE, for good and valuable consideration (including the
payment by Buyer of the purchase price for the Transferred Assets), the
adequacy and receipt of which are hereby acknowledged:
1. Seller does hereby sell, assign, transfer, convey and
deliver (collectively, "sell") to Buyer, free and clear of all obligations
and liabilities except as expressly provided herein or in the Purchase
Agreement:
2. This Bill of Sale shall not constitute a waiver of any
rights and remedies of Buyer under the Purchase Agreement with respect to
any of the Transferred Assets hereby sold to Buyer.
3. Upon request of Buyer, Seller shall do, execute, acknowledge
and deliver all such further acts, assurances, deeds, assignments,
transfers, conveyances and other instruments and papers as may be required
to sell to and vest in Buyer, and protect Buyer's right, title and interest
in and enjoyment of, the Transferred Assets and as otherwise may be
appropriate to carry out the transactions contemplated by the Purchase
Agreement. Pursuant to Section 4.1 of the Purchase Agreement, to the
extent that any Transferred Asset may not be sold to Buyer without the
consent of any other party, this Agreement shall not constitute a sale or
attempted sale thereof if such sale or attempted sale requires a consent.
Such sale shall occur immediately after receipt of the applicable consent.
4. This Bill of Sale shall be governed by and construed in
accordance with the internal laws of the State of New York applicable to
agreements made and to be performed entirely within such State, without
regard to the conflicts of law principles of such State.
5. In the event any one or more of the provisions contained in
this Bill of Sale should be held invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining
provisions contained herein and therein shall not in any way be affected or
impaired thereby. The parties shall endeavor in good-faith negotiations to
replace the invalid , illegal or unenforceable provisions with valid
provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.
6. This Bill of Sale is executed pursuant to the Purchase
Agreement and is entitled to the benefits and subject to the provisions
thereof and shall bind and inure to the benefit of the parties and their
respective successors and assigns.
IN WITNESS WHEREOF, the parties have caused this Bill of Sale to
be duly executed as of the day and year first above written.
UNIPHASE LASER ENTERPRISE AG INTERNATIONAL BUSINESS
MACHINES CORPORATION
By: \s\ Danny E. Pettit By: \s\ Suzanne C. Lewis
Title: Vice President, Finance and CFO Title: Business Development
Consultant
Services Agreement
(the "Services Agreement")
between
Uniphase Laser Enterprise AG, Zug,
c/o Treuhand von Flue AG, Grienbachstrasse 17, 6301 Zug
(hereinafter referred to as the "Lessee")
on one hand
and
International Business Machines Corporation, Zurich Research Laboratory,
Saumerstrasse 4, CH- 8803 Ruschlikon,
(hereinafter referred to as the "Lessor")
on the other hand
____________________
Whereas, the Lessor wishes to sell Uniphase Corporation and to the
Lessee, and Uniphase Corporation and the Lessee wishes to purchase
from the Lessor the Transferred Assets as defined in the Purchase
Agreement (as defined below)
Whereas, the Lessee, Uniphase Corporation and the Lessor for this
purpose have entered into purchase agreement dated of even date
herewith (hereinafter referred to as the "Purchase Agreement"), and
Whereas, the Lessor and the Lessee have entered into a Lease
Agreement for certain offices, cleanroom, wet and dry laboratories,
and common rooms in the premises of Saumerstrasse, Ruschlikon,
Switzerland, owned by the Lessor, during a transitional period
following the execution of the Purchase Agreement (hereinafter
referred to as the "Lease Agreement"); and
Whereas, the Lessor and the Lessee intend, during such transitional
period following the execution of the Purchase Agreement to provide
and receive partly on mandatory and partly on optional basis
respectively certain basic support and administrative services; and
Whereas, on the other hand, the Parties agree that there are
certain services which Lessor provides for its departments, which
will not be available to the Lessee.
Now therefore in consideration of the mutual covenants and
undertakings herein contained the parties hereto agree as follows:
1. Subject Matter of the Agreement
1.1. The subject matter of the Services Agreement is to set
forth the conditions under which Lessor will provide services
to the Lessee for the term of the Lease Agreement. In this
respect it is to be distinguished between:
a) Such services which the Lessee has the duty and the
right to make use of and the Lessor has the obligation to
provide for the term of the Lease Agreement (hereinafter
referred to as "Mandatory Services"); and
b) such services which the Lessee may, at its option, take
advantage of (hereinafter referred to as "Optional
Services").
1.2. The Lessee acknowledges and agrees that the Lessor is
offering no services other than those hereinbefore mentioned
and which are hereinafter defined as Mandatory and Optional
Services.
2. Mandatory Services
2.1. Mandatory Services including specific prerequisites and
conditions of the same are set forth in Schedule 1.
2.2. The Lessor undertakes with the execution of the Services
Agreement to provide the mandatory services in accordance with
the remaining provisions of this agreement for the entire term
of the Lease Agreement.
2.3. The Contracting Parties agree that according to the
provisions of Section 9.7. and 10.1. of the Lease Agreement
they are obligated to make use of or to carry out the Mandatory
Services for as long as the term of the Lease Agreement lasts.
3. Optional Services
3.1. The Optional Services which may be required by the Lessee
for the term of the Services Agreement are set forth in
Schedules 2 and 3.
3.2. Schedule 2 sets forth such Optional Services including the
specific prerequisites and conditions which the Lessee may
request in writing from the Lessor (hereinafter referred to as
"Optional Services Category 1").
3.3. Schedule 3 sets forth a general description of such
services which the Lessor is offering to the Lessee whereby the
prerequisites and the conditions have not been set forth
(hereinafter referred to as "Optional Services Category 2").
In the event that the Lessor wishes to take advantage of any
such individual service, the Parties shall enter into an
additional agreement regarding such services. Any such
additional agreement shall supplement the Services Agreement by
way of a Schedule thereto. As far as such additional agreement
does not foresee any special regulation, the rules of the
Services Agreement shall be applicable.
3.4. The Lessee acknowledges and agrees that the Lessor shall
carry out all such Optional Services as shall be required
according to the availability of the same whereby the Lessor,
in using its resources, may primarily take into account its own
needs.
3.5. The Lessee is aware that in the event the Lessee calls
upon third parties for the purpose to carrying out the Services
of model shop, electronic services, shared tools, cafeteria,
self-service model shop (as referenced in Optional Services
Category 1. Schedule 2), the provision thereof shall occur
outside the Site. The facilities of the Lessor cannot be used
for this purpose.
4. Extent and Provision of Services
4.1. The Lessor agrees to provide the services under this
Services Agreement with the appropriate care and diligence.
The standard of assistance on the part of the Lessor is to be
measured with respect to the contents as well as the standard
of care, in accordance with the past services of the Lessor of
the particular service within its enterprise.
The Lessee confirms that as a result of the level of knowledge
of such employees as it has assumed, it has adequate knowledge
of the standard of the previous provision of services.
4.2. The Lessor is entitled to call upon third parties for the
purpose of carrying out the services hereunder.
5. Place of Performance
The place of performance of all of the services provided for in the
Services Agreement is in the Leased Premises according to the Lease
Agreement.
6. Deadlines
6.1. Inasmuch as no distinct rule has been agreed to in
writing, the Lessor shall provide the services during working
days only, from Monday to Friday, from 8.00 a.m. till 5.00
p.m., according to the availability of the resources pursuant
to Section 3.4. hereof.
6.2. In the event that circumstances beyond its own control,
namely the failure of third party suppliers to observe
deadlines should lead to postponements on the part of the
Lessor, then deadlines shall be correspondingly postponed.
7. Term of the Agreement
7.1. The term of the Services Agreement shall begin on the
Closing Date of the Purchase Agreement and shall remain in
force for as long as the Lease Agreement shall remain in
effect.
7.2. Upon termination of the entire Lease Agreement, the
Services Agreement shall terminate automatically.
8. Early Termination of Individual Service Requirements
8.1.The Mandatory Services have been agreed to for the entire term
of the Services Agreement and the Lease Agreement. Except in
case of the early termination of the entire Lease Agreement, it
may not be terminated early by either the Lessor or the Lessee.
8.2.Any item of the Optional Services Category 1 may be terminated
by both Parties by means of written notice with a notice period
of 60 days effective as of the end of the calendar month next
following the expiration of the notice period.
The Lessor shall remain obligated for the remaining term of
this agreement to provide Optional Services Category 1
according to the remaining provisions of the Services
Agreement.
8.3.With respect to the termination of the provision of Optional
Services of Category 2 the same shall be governed by the
relevant terms of the individual supplementary agreement
entered into with respect thereto.
9. Duty to provide Information on the Part of the Lessee
The Lessee shall provide to the Lessor all information reasonably
required by the Lessor for the Lessor to perform its obligations
hereunder.
10. Liability
10.1. Each Party is solely responsible and liable for its
employees and its respective performance under this Services
Agreement.
10.2. The Lessor shall not have any liability to the Lessee with
respect to the performance of its obligation pursuant to the
Services Agreement, except for direct damages subject to the
limitation in Section 10.4. incurred by the Lessee as a result
of the breach of the Services Agreement by the Lessor. In no
event will the Lessor be liable to the Lessee for loss of
revenue or profits or any indirect damages including claims of
third parties.
10.3. Should the subject matter of the Services Agreement be the
provision of products which the Lessor for its part is
obviously provided with by a third party, the Lessor shall only
be liable to the Lessee to the extent that the third party
supplier has provided the Lessor with a warranty and is liable
to the Lessor.
10.4. If damages do not exceed SFr. 5'000.-- per event, the
Lessor shall not be liable. If damages exceed SFr. 5'000.-- the
Lessor's total liability for such event will be limited to SFr.
200'000.--. However, the cumulative liability of the Lessor
during the term of the Services Agreement will not exceed SFr.
1'000'000.--. This limitation shall not apply in case of
personal injury.
10.5. Notwithstanding the foregoing, the Lessor shall not be
liable for any failure of performance attributable to acts or
events (including, but not limited to, war, conditions or
events of nature, government acts or regulations, civil
disturbances, work stoppage, power failures, failure of
telephone lines and equipment, fire and flood) beyond the
control of the Lessor which rendered performance by it
hereunder impossible.
10.6. Any further liability or warranty is excluded.
11. Intellectual Property
The Parties will agree to negotiate intellectual property rights
for intellectual property that arises from the result of the work
performed by Lessor for the Lessee hereunder under Optional
Services Category 1 / Model Shop and Electronic Services prior to
the provision of such services.
12. Remuneration
12.1. The remuneration of the Mandatory Services is set forth in
Schedule 1.
12.2. The remuneration of the Optional Services Category 1 is
set forth in Schedule 2.
12.3. The remuneration of the Optional Services Category 2 shall
be determined by the relevant terms of the individual
supplementary agreement entered into with respect thereto.
12.4. The remuneration for the supplied services shall be
invoiced at the end of each month. Unless the Lessee does not
react within thirty days from the receipt of the invoice, the
acceptance thereof is deemed. The payment shall occur within 30
days from the date of the invoice.
13. Compliance with Laws
13.1. The Lessor represents that it will provide the services under
this Services Agreement in compliance with the applicable laws
for example environmental protection laws.
13.2. The Lessee represents that it will use the services under
this Services Agreement in compliance with the applicable laws
for example environmental protection laws.
14. Final Provisions
14.1. The Services Agreement shall be governed by and construed
in accordance with the laws of Switzerland.
14.2. In case any provision of the Services Agreement shall be
held invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any
way be affected or impaired thereby.
14.3. The court of jurisdiction is Horgen.
14.4. This Agreement supersedes any and all previous agreements
whether written or oral with respect to the subject matter and
may not be amended unless in writing.
____________________
Place, Date Place, Date
3-10-97 3-10-97
The Lessee The Lessor
\s\ Danny E. Pettit \s\ Suzanne C. Lewis
Mandatory Services
1. Building Operations Services
1.1.For the purposes of the Services Agreement building operation
services mean the performance of all maintenance necessary to the
building and the Leased Premises and to integral parts thereof. All
measures which affect the building are exclusively controlled by
the Lessor.
According to Section 9.7. and Section 10.1 of the Lease Agreement
the Lessor shall carry out the following services:
a) Laboratory rearrangements (excluding construction related
projects)
b) Maintenance
c) Repairs
d) Installations and changes on installations
e) Janitor Service
f) Cleaning
g) Recycling
1.2.Fit up arrangements are not included. Repairs and maintenance
services are not provided for the Lessee's assets.
1.3.Dependent on the urgency, the Lessor shall carry out the requested
services. The Lessor may set priorities. The Lessor will set high
priority to temperature and humidity control of cleanrooms,
maintaining the emergency electrical system and maintaining cooling
water.
1.4.The Lessor's contact person is Otto Buchegger. The Lessee's contact
person is Kurt Muller.
2. Chemical Services
2.1.Chemical services cover all those measures and transactions in
connection with chemicals.
Chemical services include following services:
a) Authorization
b) Internal supply of chemicals
c) Control
d) Waste disposal
e) Education and support
f) Storage
2.2.The Lessor has the right to exercise control over chemicals used on
the site.
2.3.All orders of chemicals must be authorized by the Lessor. The
Lessor may refuse a request of order of the Lessee for reasonable
safety reasons or if the storage of the requested quantities cannot
be reasonably guaranteed.
However, the Lessee shall be responsible for the punctual request
of the necessary orders with due regard of the handling of the
request by the Lessor and of the time for delivery.
2.4.The Lessor will take delivery of the chemicals and check them in
respect of the ordered quantity. No quality checks will be carried
out by the Lessor.
2.5.The Lessor will store all the delivered chemicals of the Lessee in
the appropriate premises in an identifiable manner. Once the
chemicals are delivered to the Lessee, the Lessee is responsible
for the storage and usage in accordance with the rules of the
Safety Manual as mentioned under Section 3.1. of this Schedule.
2.6.The Lessor is prepared to give further reasonable advice, counsel
and provide for the education of the Lessee's employees upon
request by the Lessee.
2.7.During working time as referred to in Section 6.1. of the Services
Agreement the Lessor will use all reasonable effort to provide for
the performance of chemical services at any time the Lessee deems
it necessary.
2.8.The Lessor's contact person for request of orders and further
advice is Hugo Ritter. The Lessee's contact person is Peter
Roentgen.
3. Safety Services
3.1.Safety services provided for the protection of the employees.
Safety services include following services:
a) Control of new equipment/Installations
b) Advice and counsel
c) Safety equipment and material
d) Education
e) Safety manual
3.2.The safety of all delivered new equipments and installation shall
be checked by the Lessor according to the Safety Manual and the
usual standards of the Lessor. The control of the Lessor does not
include further inspections. The control by the Lessor does not
relieve the Lessee of his liabilities.
3.3.The Lessor has published for use on the site only a Safety Manual,
where all essential safety rules are entailed. The Lessee is in
possession of this manual and must strictly follow these rules.
3.4.The Lessor is ready to give further reasonable advice and provide
for the education of the Lessee's employees upon request by the
Lessee.
3.5.The Lessor's contact person is Hugo Ritter. The Lessee's contact
person is Peter Roentgen.
3.6.Notwithstanding the foregoing, the Lessee is exclusively
responsible for the safety of its employees.
4. Security Services
4.1.Security measures include all measures to ensure the authorized
entrance and use of the building.
Security services include following services:
a) Guard service
b) Access system
c) Controls
4.2. Such security services are provided by the Lessor.
4.3.The Lessee must strictly follow such measures. He has no competence
to introduce new measures. For the use of the badges reference is
made to Section 8.3 of the Lease Agreement.
4.4.The Lessee agrees that his employees will continue at an
appropriate level to participate in the Lessor's fire-brigade and
First Aid organization as long as they are on site.
4.5.The Lessor's contact person for security services is Otto
Buchegger. The Lessee's contact person is Kurt Muller.
5. Receiving Services
5.1.The Lessor will provide for the acceptance of goods which are not
delivered by postal service.
5.2.The Lessee shall notify to the Lessor of deliveries within 24 hours
in advance.
5.3.Except for chemicals and equipments/installations, the Lessor does
not control the delivered merchandise.
5.4.The Lessor's contact person for receiving service is Hans Schmid.
The Lessee's contact person is Ursula Breitschmid.
6. Reception Services
6.1.The Lessee may use within regular working hours all the services of
the switchboard.
6.2.Separate phone and fax numbers will be assigned and the costs will
be charged to the Lessee. However, eight telephone lines are
included.
6.3.The Switchboard is responsible for the reception of customers.
6.4.Contact person for the reception services is Lilli Pavka. The
Lessee's contact person is Anastasia Cosman.
7. Remuneration
7.1. No remuneration for the Mandatory Services is due by the
Lessee until the 30. June 1998.
7.2. Unless the space occupied by the Lessee exceeds the rented
space of 68.1 meters square, during the period from 1. July 1998
until 31. December 1998 no remuneration for the Mandatory Services
will be due for this period. Otherwise, if additional space is
occupied by the Lessee the charge for Mandatory Services will be
SFr. 36'000.-- per month.
7.3. As of 1. January 1999 the Lessee must pay SFr. 36'000.-- per
month for the provision of Mandatory Services, independent of
the leased surface.
Optional Services Category 1
1. Model Shop & Electronic Services
1.1. Under model shop & electronic services the Parties includes
all the labor that is related to designing, developing,
fabricating and maintaining, mechanical and electronic parts,
tools, assemblies and software which may directly support the
development of future products as well as the production line.
Therefore the Lessee's equipment may be maintained, repaired and
improved. Whereas the electronic services concern measures which
deal exclusively with electronic matters, be it hardware or
software, the model shop concern all other work to the Lessee's
equipment.
Model shop & electronic services include :
a)Direct involvement in development of new test- and fabrication
equipment
b)Design and fabrication of tools and assemblies not available
on the open market
c) Laboratory Automation
d) Consulting
1.2. The Lessor shall carry out the above mentioned services on
written request and specification of the Lessee.
The Lessor, however, may refuse the performance in its
discretion. The interests of the Lessor's business have
priority.
The deadlines shall be determined in a separate written
agreement.
1.3. For the model shop services the Lessee shall pay a hourly
compensation of SFr. 159.--
For the electronic services the Lessee shall pay a hourly
compensation of SFr. 161.--
The prices do not include costs and expenses for the used
material. These will be charged to the Lessee.
1.4. The Lessor's contact persons for model shop & electronic
services is Urs Bapst. The Lessee's contact person is Peter
Roentgen.
2. Information System (I/S)
2.1. Information system services are divided into the explicit or
dedicated services and implicit services.
Explicit services are those where an I/S employee directly works
for the Lessee, e.g. when installing or repairing a workstation,
when building up a special LAN for the Lessee, consulting hours,
etc.
Implicit are those services which are part of the general I/S
infrastructure, e.g. automatic backup, the Notes infrastructure,
the LAN operation, data space on file servers, printing
services, etc. This includes for example a proportional amount
of depreciation for the servers, public printers, etc. but not
for the Lessee-owned workstation, printers, etc.
2.2 Lessor will provide only the existing cables at the Leased
Premises as of 7. March, 1997 for the term of the Lease Agreement
at no charge to assist Lessee in implementing its own network
infrastructure.
2.3. Lessor will provide the following implicit services on an
interim basis not to exceed 6 months after the Closing Date of the
Purchase Agreement at no additional charge: LotusNotes Mail and
Lessee specific databases and services such as user identifiable
mail folders, electronic mail received, the ability to send
Internet Mail, the Quality Review Board database, Addressbook
database, and personal databases specific to Lessee's operation.
2.4. For one month following the Closing Date of the Purchase
Agreement, Lessor will provide Lessee employees with access to the
AIX and/or VM environments. After such one month period, access
will be terminated. However, for six months following the Closing
Date of the Purchase Agreement, 3 user id's (CHA, LBR, and MAC)
will have access to the AIX and/or VM environments. Such access
will then terminate after six months. This access will be provided
at no additional charge.
2.5. Lessor will provide, at no additional charge, access to
network printers, plotters, scanners and to the Internet gateway
for 6 months after the Closing Date of the Purchase Agreement.
2.6. Lessor will provide for to Lessee continuation of the
automatic back-up process for personal data. Lessor will provide
this process to Lessee for 6 months after the Closing Date of the
Purchase Agreement at no additional charge. However,
notwithstanding anything contrary contained in this Agreement,
Lessor will not be liable nor does it guarantee the validity or
accuracy or operation of the back-up process. This process is
provided as-is.
2.7. Lessor will provide access for the Cadence application and a
plotter that can be used for this application for six months
following the Closing Date of the Purchase Agreement. After such
six month period, such access will be charged as determined by
Lessor. Such access will terminate on 31. December, 1997.
2.8. Except for sections 2.2, 2.3, 2.4, 2.5, 2.6 and 2.7 the Lessor
shall carry out the above mentioned explicit or implicit
services on written request and specification of the Lessee.
The Lessor, however, may refuse the performance thereof any time
the competent staff has not free capacity. The interests of the
Lessor's business have priority.
The deadlines shall be determined in a separate written
agreement.
2.9. Explicit services will be charged with an hourly rate of SFr.
195.--. The charges for implicit services will be defined when
requested and accepted.
The prices do not include the costs of material and/or equipment
incurred by the Lessor. These will be charged to the Lessee.
2.10. The Lessee must comply with all applicable Information Assets
Security Rules of the Lessor which will be supplied by the
Lessor upon first request of the Lessee.
2.11. The Lessor's contact person for the information services is
Heinrich Muller. The Lessee's contact person is Mr Baldegger.
3. Shared Tools and Equipment
3.1. The FIB, RIN and TEM machines will remain at the Lessor's
location. The Lessee may use these two tools as long as he
occupies the leased premises.
3.2. The Lessee may use the tools hereinabove upon availability and
subject to Lessor's priority. However, the maximum usage right
of the Lessee for the FIB is 40% of the average usage per
quarter starting on the Closing Date of the Purchase Agreement.
The maximum usage right of the Lessee for the TEM is 50% of the
average usage per quarter starting on the Closing Date of the
Purchase Agreement. The maximum usage right of the Lessee for
the RIN is 50% of the average usage per quarter starting on the
Closing Date of the Purchase Agreement.
3.3. There will not be an additional charge to the Lessee for this
tool usage until after 31. December 1998.
3.4. The equipment located in room L213 (as referenced in Schedule
2 of the Lease Agreement) may be used with priority by Lessee
during the lease term with no additional charge from Lessor.
3.5. The SEM located in room H136 (as referenced in Schedule 1 of
the Lease Agreement) may be used with priority by Lessee during
the lease term with no additional charge to Lessee until a new
SEM is installed by Lessee. After such installation, Lessee may
also use the SEM but only in the case of an emergency and with
the approval and subject to the priority of Lessor.
3.6. The CVD system in room H207 (as referenced in Schedule 2 of
the Lease Agreement) may be used with priority by the Lessee
during the lease term with no additional charge, until a new CVD
system is installed but no longer than 31. May 1997.
3.7. The Photoluminous for MBE in room C253 (as referenced in
Schedule 1 of the Lease Agreement) may be used with priority by
the Lessee during the lease term with no additional charge.
However, Lessor reserves the right to use such tool for a
minimum period of 2 hours per day during the lease term.
3.8. The Packaging Equipment in room H161 (as referenced in
Schedule 2 of the Lease Agreement) may be used with priority by
the Lessee during the lease with no additional charge. However,
Lessor reserves the right to use such equipment for up to 50% of
the average usage per quarters starting on the Closing Date of
the Purchase Agreement.
3.9. The Lessor will give the Lessee first priority to purchase the
shared tools and equipment before offering them to a third party
("Vorkaufsrecht").
4. Cafeteria Services
4.1. Lessor will provide cafeteria services to all the employees of
the Lessee to the same extent that it does for its own
employees. The additional charge to the Lessee for the cafeteria
services is SFr. 10'000.-- per month until 31. December 1997.
The Lessor will provide for cafeteria services after 31.
December 1997 at a charge to be agreed upon by Lessor and
Lessee.
4.2. The Lessor will charge separately for visitors, coffee or
other special services.
5. Library, Self-Service Model Shop, Stockroom, Mail Distribution, Copiers
Scanners Printers
5.1. The Lessor will provide the above referenced services to the
Lessee at no additional charge until 31. March 1997.
5.2. Notwithstanding anything to the contrary in the Services
Agreement such services will be charged to the Lessee after 31.
March 1997.
5.3. The Lessor will provide a quote of charges before 25. March
1997 to the Lessee for such services beyond 31. March 1997.
Optional Services Category 2
With due regard of the availability of staff and the Lessee's
business interests, the Lessor may perform services such as:
1. Finance
Accounting; Controlling; Reporting; Payroll.
2. Purchasing
Purchasing of equipment and material; Mail distribution.
3. Publication/Office services
Graphics Support; Word Pro - Applications; Conference Preparation.
Ancillary costs
Following main expenses are entailed in the rent of the Leased Premises A,
B, C:
Electricity
Water
Sewage-charges
Heating, Fuel
Waste removal and paper recycling
Guard Services
Building maintenance (excludes costs relating to interior decoration)
Maintenance and repair of building installations
Existing infrastructure (excluding toll charges) of telephone PBX lines.
IBM Zurich-Site Safety Manual
(Note: IBM Zurich-Site Safety Manual has been delivered to the Lessee).
Laboratory Real Estate Lease
(the "Lease Agreement")
made and entered
between
International Business Machines Corporation, Zurich Research Laboratory,
Saumerstrasse 4, CH- 8803 Ruschlikon,
(hereinafter referred to as the "Lessor")
on the one hand
and
Uniphase Laser Enterprise AG, Zug,
c/o Treuhand von Flue AG, Grienbachstrasse 17, 6301 Zug
(hereinafter referred to as the "Lessee")
on the other hand
____________________
Whereas, the Lessor wishes to sell to Uniphase Corporation and the
Lessee, and Uniphase Corporation and the Lessee wishes to purchase
from the Lessor the Transferred Assets as defined in the Purchase
Agreement (as defined below)
Whereas, Uniphase Corporation and the Lessee and the Lessor for
this purpose have entered into purchase agreement dated of even
date herewith (hereinafter referred to as the "Purchase
Agreement"), and
Whereas, the Lessor wishes during a transitional period following
the completion of the Purchase Agreement to lease to the Lessee,
and the Lessee wishes to rent from the Lessor the Leased Premises
(as defined below), subject to the terms and conditions hereinafter
set forth, in order to allow the immediate start of the production
of certain components,
Whereas, the Lessor and the Lessee intend, during the transitional
period following the completion of the Purchase Agreement to
receive and provide certain basic support and administrative
services and for this purpose shall enter into a services agreement
(hereinafter referred to as "Services Agreement");
Now, therefore, in consideration of the premises set forth above
and the respective covenants, agreements, hereinafter set forth,
Lessor and Lessee (collectively the "Parties") hereby agree as
follow
1. Leased Premises
The Lessor leases to the Lessee in the building located at
Saumerstrasse 4, CH-8803 Ruschlikon the following premises
(collectively the "Leased Premises"):
a) 340.0 meters squared offices and 143.9 meters squared dry
laboratories and 30.0 meters squared (such premises being
hereinafter referred to as "Premises A") further
described in Schedule 1 and 4.
b) 68.8 meters squared offices, 77.4 meters squared cleanroom, 35.3
meters squared dry laboratories and 380.3 meters squared wet
laboratories (such premises being hereinafter referred to as
"Premises B") further described in Schedule 2 and 4.
c) 15.1 meters squared offices and 53.0 meters squared wet
laboratories (such premises being hereinafter referred to as
"Premises C") further described in Schedule 3 and 4.
The joint use of public spaces such as parking, corridors,
cloakrooms, reception area, rooms (as referenced in the Safety
Manual in Schedule 6) and the joint use of the conference rooms are
included in the Lease Agreement. The Lessee can use conference
rooms including the video conferencing equipment subject to
availability.
2. Use of the Leased Premises
The Leased Premises shall be used for the production of diode-
lasers in the same manner as they have been used by Lessor's Laser
Enterprise Department.
3. Term of the lease
3.1.The term of the lease for the Premises A, B, C begins on the
Closing Date of the Purchase Agreement.
3.2.The lease of the Premises A shall end on ( * )
without notice of termination (hereinafter referred to as
"Fixed Lease Period A").
3.3.The lease of the Premises B shall end on ( * ) without
notice of termination (hereinafter referred to as "Fixed Lease
Period B").
3.4.The lease of the Premises C shall end on ( * )
without notice of termination (hereinafter referred to as
"Fixed Lease Period C").
* - Information redacted and filed separately with the SEC.
4. Extension of the lease periods
4.1. The Lessee has the right to unilaterally extend the lease term
with regard to the Premises A until the ( * ).
The notification of the extension shall be made by written
notice by the Lessee to the Lessor three months prior to the
end of the Fixed Lease Period A.
4.2. The Lessee has the right to unilaterally extend the lease term
with regard to the Premises B until the ( * ).
The notification of the extension shall be made by written
notice by the Lessee to the Lessor three months prior to the
end of the Fixed Lease Period B.
4.3.The Lessee has the right to unilaterally extend the lease term
with regard to Premises C until the ( * ) of the wet
laboratories as mentioned in Schedule 2. The Lessee also has
the right to swap one of the wet laboratories in lieu of L 261
of Schedule 3.
The notification of the extension shall be made by written
notice of the Lessee to the Lessor three months prior to the
end of Fixed Lease Period C.
4.4.The Lessee is aware that the Lease Agreement will be concluded
for the limited Fixed Leased Periods A, B, C and that he may
only request the extensions within the periods as described
hereinabove. Any further extension of the lease relationship
shall not be agreed because of the urgent need for the Lessor's
own use which involves a restructuring of the Leased Premises,
scheduled to start at the latest on ( * ) for the
Premises A, on ( * ) for the Premises B and on (
* ) for Premises C. Therefore, the Lease Agreement as
described hereinabove is concluded expressly for a limited
period of time according to Article 272a (1)(d) of the Swiss
Code of Obligations.
4.5.The Lessee is aware that it requires a considerable effort to
find and equip suitable facilities to carry on his business
within a reasonable period of time and therefore before Closing
Date the Lessor has indicated him the opportunity for renting
other business premises in the locality of Binz in Zurich in
order for Lessee to be able to move to equivalent premises
within the agreed to time.
* - Information redacted and filed separately with the SEC.
5. Rent
5.1.For the lease of Premises A for the Fixed Lease Period A, of
Premises B for the Fixed Lease Period B and of Premises C for
the Fixed Lease Period C no rent is due by Lessor. The payment
of the remuneration for the use of the Leased Premises is
already included in the purchase price of the Transferred
Assets according to Section 1.3. of the Purchase Agreement.
5.2.For the extension of the lease term for the Premises A, the
Lessee shall pay a monthly rent of SFr. 90.-- per meters squared
for the use of the offices and of SFr. 145.-- per meters squared
for the use of the dry laboratories.
5.3.For the extension of the lease term for the Premises B, the
Lessee shall pay a monthly rent of SFr. 90.-- per meter squared
for the use of the offices, of SFr. 345.-- per meter squared
for the use of the cleanroom and of SFr. 210.-- per meters
squared for the use of the wet laboratories.
5.4.For the extension of the lease term for the Premises C, the
Lessee shall pay a monthly rent of SFr. 135.-- per meter squared
for the use of the offices and SFr. 320.-- meter squared for
the use of the wet laboratories.
5.5.The rent for the extensions of the lease term of Premises B and
C is based on the index of consumers' prices at the Closing
Date of the Purchase Agreement. If for the 1. July 1998 the
index of consumers' prices (base May 1993 = 100 points)
increases of at least 5 points, the Lessor may once, at the
commencement date of each extension period increase the agreed
rents according to the following formula:
Increase in %:
new index - index at the time of conclusion of the contract
x 100
--------------------------------------------------
index at the time of conclusion of the
contract
5.6.The agreed initial rents cannot be decreased.
5.7.The Lessee shall pay the rents at the end of each month for the
following month to the bank account as designated by the
Lessor.
6. Ancillary costs
6.1.Under ancillary costs of this Lease Agreement the Parties
understand the remuneration for performances by the Lessor
which are connected with the use of the Leased Premises A, B, C
and with the use of the common spaces further described in
Schedule 5.
6.2.No ancillary costs are due by the Lessee. These costs are
included in the purchase price as entailed in the Purchase
Agreement for the fixed periods A, B, C and in the rents for
the extensions of the Lease Agreement.
6.3.Telephone and fax expenses are not included in the ancillary
costs and will be charged separately to the Lessee.
7. Transfer of the Leased Premises
7.1.The transfer of the Leased Premises provided for in this
agreement shall take place on the Closing Date of the Purchase
Agreement.
The Lessor transfers the Leased Premises "AS IS". The Leased
Premises are deemed to be in a suitable condition for the use
as listed in Section 2 of this agreement. The Lessor represents
that at the Closing Date the Leased Premises comply with all
applicable laws including without limitation, environmental
protection laws, construction laws, the fire police law and the
requirements of the Labor Statute.
7.2.The Parties renounce to draw up a transfer protocol.
7.3.On the day of the transfer the Lessor will exchange the old
badges delivered to the transferred employees for the new ones
in order to allow the entering in the building and in the
Leased Premises to the Lessee. The replacement of lost or
stolen badges during the lease are part of the Mandatory
Services of the Lessor and are in his exclusive competence. The
Lessee shall immediately inform the Lessor of any loss. The
Lessee must pay the costs of the replacement. The procurement
of additional badges is in the exclusive competence of the
Lessor. The Lessee shall inform the Lessor of any need hereof.
7.4.The Lessor will instruct the Lessee about the security system
of the building.
7.5The Lessee confirms that he has received a copy of the 'IBM
Zurich-Site Safety Manual', which is attached to this Lease
Agreement as Schedule 6.
8. Duties of the Lessee
8.1.The Lessee shall use the Leased Premises with due care. He
shall use them only for the purposes mentioned under Section 2.
8.2.The Lessee shall give due consideration for other occupants and
he shall not impair in any way the Lessor's business and
research activities.
8.3.Except for the entrance of the Leased Premises and the common
spaces, the Lessee shall not have access to the other parts of
the building, specifically the research laboratories of the
Lessor except as provided for under the Services Agreement or
elsewhere under this Lease Agreement.
8.4.The Lessee shall observe all the security, safety and general
rules of the house regulations (hereinafter referred to as
"Internal Rules") to the extent they do not conflict with the
Lease Agreement. The Lessee is aware that the Internal Rules
are subject to revision to the extent they do not conflict with
the Lease Agreement by the Lessor and that he has no right to
request any replacement thereof.
8.5.The Lessee shall manage his business in accordance with the
Swiss mandatory public laws, and in particular to obey the
applicable rules of Swiss environmental protection law, of the
fire police law, the requirements of the Accident Insurance
Statute and all the related standards and the and the
requirements of the Labor Statute
8.6.The Lessee is not allowed to carry out any building
modification to the Leased Premises. Such modifications need
the written consent of the Lessor which consent shall not be
unreasonably delayed or refused.
8.7.All the Mandatory Services as defined in Section 2 and Schedule
1 of the Services Agreement are exclusively performed by the
Lessor. While occupying the Leased Premises the Lessee must
make use of the Mandatory Services as provided by the Lessor.
The Lessor is obliged to provide such Mandatory Services. The
Lessee shall consult with the Lessor (the competent staff)
about any necessity and problem. The Lessee shall immediately
report all defects to the contact persons as further mentioned
in Schedule 1 of the Services Agreement.
8.8.The Lessee shall permit the Lessor to enter the Leased Premises
to perform the Mandatory and Optional Services according to
Sections 2 and 3 and Schedules 1, 2 and 3 of the Services
Agreement, further, if necessary, for the maintenance, to
remedy defects and to repair or avoid damages. Except for the
performance of the Mandatory and Optional Services and for
emergency, the Lessee shall be notified ahead of time to the
extent possible.
8.9.Notwithstanding anything to the contrary set forth in the Lease
Agreement, if repairs and other urgent action are necessary,
the Lessee shall inform the Lessor and shall undertake all
reasonable precautions. The Lessee shall be liable for failure
to notify the Lessor.
8.10.The Lessee must remedy, at his own expenses, defects for which
the Lessor is not responsible according to Section 10.1 of the
Lease Agreement and which may be cured by standard cleaning, or
repairs and replacements necessary for ordinary maintenance.
The Lessee is not entitled to call upon external third parties
for the purpose of carrying out the obligation hereunder
without the prior written consent of the Lessor which consent
shall not be unreasonably delayed or refused.
8.11.Despite a ten day prior written notice period to cure, if the
Lessee continues to violate his duties according Section 9.1 to
9.6. in a manner such that the continuation of the Lease
Agreement may no longer be expected from the Lessor, the Lessor
may give notice of termination of the Lease Agreement with
effect after a period of 30 days as per the end of a month. The
Lessor may, however, give notice of termination of the
agreement with immediate effect if the Lessee has intentionally
caused serious damage to the Lessor's building.
9. Duties of the Lessor
9.1.The Lessor is obliged to maintain the Leased Premises in
compliance with all applicable laws, in a suitable condition
for the contractual use, to remedy the material defects and to
perform the Mandatory Services at any time they are necessary
within the periods further described in Section 6.1. of the
Services Agreement.
9.2.The Lessor shall inform the Lessee of any change of the
Internal Rules.
9.3.The Lessor shall not have access to the Leased Premises, except
for laboratories shared with Science and Technology as
mentioned in Schedule 2 and except as provided for under the
Services Agreement or elsewhere under this Lease Agreement.
10. Liability insurance
On 1. April 1997 the Lessee shall deliver a copy of the signed
professional risk indemnity insurance policy which shall cover at
least US$ 5'000'000.--.
11. Sublease
According to Article 262 (2)(c) of the Swiss Code of Obligations,
the sublease of the premises is not allowed because it would cause
significant disadvantages for the Lessor. Empty spaces will be
taken over by the Lessor.
12. Return of the Leased Premises
12.1.The Lessee must return the Premises in the same condition as
taken over with the reservation of the normal wear and tear
which results from the use provided for in this agreement under
Section 2.
12.2.The Lessee shall remove all the Transferred Assets. The
separation and removal shall conform to the rules mentioned in
Section 9 hereinbefore. The Lessee will not be liable for
incidental damages which arise as a natural consequence from
the separation and removal of the Transferred Assets. The
Lessee will bear the costs for the separation and removal. The
Lessor will cooperate with the Lessee in connection with such
separation and removal under a separate agreement.
12.3.The waste caused by the removal of the Transferred Assets will
be disposed of by Lessor and will be charged to the Lessee.
12.4.The Lessee shall return all the badges, keys and all the
documentation which concerns the Leased Premises.
12.5.The Lessee represents that at the date of return of the Leased
Premises, the Leased Premises will comply with all applicable
laws including without limitation environmental protection
laws, construction laws the file police law and the
requirements of the labor statute.
13. Applicable law / Place of Jurisdiction
13.1.This agreement shall in all respect be interpreted and
construed in accordance with and governed by the laws of
Switzerland, and shall be subject to performance in the country
of Switzerland.
13.2.Where no special clause is entailed in this agreement,
Articles 253 ff. of the Swiss Code of Obligations shall apply.
The compulsory statutory liability rules are applicable to this
agreement.
13.3.The court of jurisdiction is Horgen.
13.4.This Agreement supersedes any and all previous agreements
whether written or oral with respect to the subject matter. And
may not be amended unless in writing.
____________________
Place, date Place, date
3-10-97 3-10-97
The Lessor The Lessee
\s\ Suzanne C. Lewis \s\ Danny E. Pettit
List of the Leased Premises A
C-Building
C 233 C 219 C 353
C 241 C 349 C 355
C 251 C 350 C 359
C 253 C 351 C 352
Old Buildings
H 136* L 204 P 258
P 257 L 208 P 273
H 208 L 230 P 277
H 220 L 234 P 281
H 226 Z 222 P 285
H 232 Z 226 P 289
H 236 H 261 M 303
H 240 M 305
* = Labs shared with Science and Technology
List of the Leased Premises B
C Building
C 260
Old Buildings
H 122* L 130 Z 245
H 132* M 100 P 266
H 155* Z 113 P 270
H 161 Z 117 P 274
H 207* Z 123 P 278
H 221 Z 207* P 282
H 249 Z 213 P 286
Z 239* P 290
* = Labs shared with Science and Technology
List of the Leased Premises C
Old Buildings
L 261 Z 218
Exhibit E: Pension Matters
Final
Paragraph 1. The Buyer's Plan.
a. The Buyer agrees as promptly as is practicable after the
Closing Date but in any event within 90 days thereafter to (i) establish a
new defined occupational pension plan or amend an existing plan (the
"Buyer's Plan") to provide Employees with pension benefits that are at
least substantially comparable with the benefits that are provided to
Employees under the Seller's two applicable pension benefit plans as of the
Closing Date (the "Seller's Plans"), (ii) provide for the participation of
Employees therein as of the Closing Date, and (iii) provide that in
applying any length of service requirement for participation or vesting,
and in determining an Employee's benefits under the Buyer's Plan, such
Employee shall be credited with prior service accruing from and after such
Employee's "Service Reference Date" as shown in the records of the Seller,
according to Seller's rules for service credit, and with such Employee's
eligible compensation under the Seller's Plan during that period. The
Seller shall provide the Buyer with true, correct and complete copies of
all documents, amendments, instruments, employee communications and records
related to Seller's Plans and required to establish and administer the
Buyer's Plan with respect to each Employee's pension benefits, eligible
compensation and service prior to the Closing Date.
b. The Buyer further agrees that the Buyer's Plan shall
contain an irrevocable provision prohibiting the Buyer or any Affiliate of
or successor to the Buyer from receiving a reversion of all or any portion
of the Transferred Pension Assets. The Buyer's Plan shall also provide
that upon the termination of Buyer's Plan and after payment of all
liabilities under Buyer's Plan, the plan trustee or its successor or
transferee shall transfer any remaining Transferred Pension Assets to a
separate trust established by the Buyer for the exclusive benefit of the
Employees provided that such trust shall not operate in a manner which
discriminates in favor of any highly paid Employees.
Paragraph 2. Calculation of Transferred Assets.
a. Seller's Actuary is E.Wirz-Kaufmann. Seller's Actuary shall
determine the proposed funds to be transferred (herein "Transferred Pension
Assets"), based on the assumptions used by the Seller's Actuary according
to the 1995 annual review of Seller's Plans reported to and approved by the
official supervisory board ("Amt fur berufliche Vorsorge"), when
calculating the assets to cover the liability under Seller's Plans.
b. The Seller will entitle Seller's "Vorsorgefonds der IBM
Corporation, Forschungslaboratorium Zurich" to transfer the amount of
Swiss Francs 1,271,699 which are part of the Seller's contribution reserve
to the Buyer's Plan. The parties agree that this amount will be allocated
to the individual pension plan accounts in the Buyer's Plan of the eleven
(11) Employees who qualify for the Seller's Personalfursorgestiftung der
IBM Corporation, Forschungslaboratorium Zurich according to the partition
amounts set forth in Attachment 1.
c. The Parties agree that the six (6) Employees listed in
Attachment 2 (the "Six Employees") remain with Seller's Plans for 180 days
after the Closing Date (the "180 Day Period"). The Seller has the
obligation to, if necessary, amend or cause to be amended the rules and
regulations of Seller's Plans in order to allow the Six Employees to remain
with Seller's Plans for the 180 Day Period. The Buyer is responsible for
the payment of normal compensation to the Six Employees after the Closing
Date as long as they are employed with Buyer. The Buyer further agrees to
pay the normal pension fund premiums as long as such Employees are employed
with Buyer until the effective date of retirement. If at any time during
the 180 Day Period any of the Six Employees applies for early retirement,
the appropriate application shall be made in writing to the
"Personalvorsorgestiftung der IBM Corporation, Forschungslaboratorium
Zurich". Such retiring Employees (the "Retiring Employees") will remain
with Seller's Plans. Seller shall, or shall cause any of Seller's Plans to
pay, or cause to be paid, the pension payments as set forth in the rules
and regulations of Seller's Plans with respect to the Retiring Employees.
If certain of the Six Employees do not apply for early retirement within
180 days after the Closing Date (the "Non-Retiring Employees"), they will
be transferred to the Buyer's Plan. The Seller will transfer or cause to be
transferred 180 days after the Closing Date to the Buyer's Plan the amount
of Swiss Francs identified in Attachment 3 for each Non-Retiring Employee.
That amount will be part of the Seller's Plans and part of Seller's
contribution reserve. The parties agree that any such amount will be
allocated for the exclusive benefit of the Non-Retiring Employees to the
individual pension plan accounts in the Buyer's Plan for the respective Non-
Retiring Employee. Notwithstanding anything to the contrary, no pension
fund amounts for the Six Employees will be transferred to the Buyer, other
than as set forth in this section c. and section g.
d. The Seller will entitle the Seller's "Vorsorgefonds der IBM
Corporation, Forschungslaboratorium Zurich" to transfer in addition to the
amount mentioned in section (b.) the amount of Swiss Francs 328,301, which
is part of the Seller's contribution reserve to the Buyer's pension plan.
e. Buyer and Seller agree that no other obligations between the
parties will result as a consequence of the partial liquidation of the
Seller's Plans and contribution reserves and will present and support this
agreement to the official supervisory board.
f. At the Closing a Board resolution of the "Vorsorgefonds der
IBM Corporation, Forschungslaboratorium, Zurich" will be provided to the
Buyer which states that the obligations mentioned in subparagraphs b,c and
d of this Exhibit E will be implemented according to their terms.
g. The Seller agrees that, ultimately, the Seller will transfer
to the Buyer's Plan the amounts required pursuant to this Exhibit E, if any
circumstance results in the Seller's Plans fund failing to transfer such
amounts, provided however that this payment from Seller be in compliance
with Swiss Law.
Paragraph 3. Actions to Effect Pension Assets Transfer. The Seller
and the Buyer shall promptly, after the Closing Date, effect the transfer
of the Transferred Pension Assets to the Buyer's Plan as contemplated by
this Exhibit E, and in compliance with applicable Swiss law. The future
Swiss Pension Transfer Agreement shall govern such matters. Such transfer
shall be in cash or, to the extent mutually agreed to by the Seller and the
Buyer, in kind.
Paragraph 4. Verification by the Buyer. The Buyer shall have the right
to appoint an independent actuary (the "Buyer's Actuary") for the purposes
of verifying the free portability calculation of the Transferred Pension
Assets, referenced in paragraph 2.a. herein, by the Seller's Actuary
(excluding the amounts agreed upon by Buyer and Seller set forth in
attachments 1 and 3 of this Exhibit E). Such amount as certified by the
Seller's Actuary shall be conclusive and binding on the Seller and the
Buyer unless, within 60 days after the delivery of such certification by
the Seller's Actuary to the Buyer's Actuary (during which time such
supporting factual information as the Buyer's Actuary may reasonably
request shall be provided by the Seller's Actuary), the Buyer's Actuary
shall notify the Seller of its disagreement with such amount. Subject to
the Swiss Pension Transfer Agreement and the procedures and terms and
conditions therein, if it exists at that time, if any such disagreement is
not resolved to the satisfaction of the Seller and the Buyer within 30 days
of the Seller's receipt of such notification (or within such longer period
as the Seller and Buyer shall mutually agree), either the Seller or the
Buyer may elect to have the calculation submitted for arbitration by a
third independent actuary mutually acceptable to the Seller and the Buyer,
who shall be entitled to the privileges and immunities of an arbitrator,
and whose determination shall be conclusive, final and binding and have the
force and effect of an arbitrable award, provided, however, that none of
the Seller, the Buyer, the Seller's Plans or the Buyer's Plan shall be
bound by any decision of such arbitrator that would cause such party to
violate law. The arbitrator will apply the pension provisions set forth in
the Purchase Agreement and this Exhibit E for any matters in dispute
hereunder. The expenses of the Seller's Actuary shall be borne by the
Seller, the expenses of the Buyer's Actuary shall be borne by the Buyer and
the expenses of any third actuary shall be borne equally by the Seller and
the Buyer.
ATTACHMENT 1 TO EXHIBIT E
Partition amounts of Seller's Contribution Reserve
List of employees and a proportional amount of contribution to the
Pension Plan as of the close date.
ATTACHMENT 2 TO EXHIBIT E
Employees eligible for Early Retirement
List of Employees Names and related birthdays.
Attachment 3 to Exhibit E
Possible partition amount of Seller's Plan and contribution reserve.
List of Employees and contributed reserves as of the close date.
13
|technology license agreement/sf-286888 v1|
3/24/97 9:17 am||
TECHNOLOGY LICENSE AGREEMENT
THIS AGREEMENT, dated as of March 10, 1997 ("Effective Date"), by and
between INTERNATIONAL BUSINESS MACHINES CORPORATION, a New York corporation
("IBM"), and UNIPHASE CORPORATION, a Delaware corporation ("LICENSEE");
WHEREAS, pursuant to an agreement of purchase and sale of even date
herewith among IBM, LICENSEE, and a Subsidiary of LICENSEE (the "Purchase
Agreement"), LICENSEE or its Subsidiary is acquiring certain assets located
in Zurich, Switzerland relating to the design, testing and manufacture of
certain components (such operations being hereinafter referred to as the
"Laser Operations"); and
WHEREAS, LICENSEE desires to utilize IBM's information and know-how
associated with the Laser Operations at the Facility (defined below), and
IBM desires to provide such a license subject to the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties hereto agree as follows:
Section 1.0 Definitions
"Authorized Locations" shall mean the Facility and the Second Source.
"Employees" shall have the meaning set forth in the Purchase
Agreement.
"Facility" shall mean the manufacturing location in Zurich,
Switzerland where the Laser Operations are occurring on the Effective Date
and any subsequent location in Europe or the US where LICENSEE shall
determine after the Effective Date to relocate the Laser Operations,
subject to any restrictions in the Purchase Agreement.
"Full Wafer Technology" shall mean a batch processing chlorine-
assisted ion beam etching technique capable of producing more than one edge
emitting semiconductor ridge waveguide laser having a gallium arsenide
quantum well active region.
"IBM Improvement Patents" shall mean all patents issued or issuing on
patent applications entitled to an effective filing date prior to five (5)
years after the Effective Date that are: (i) licensable at any time by IBM
or any of its Subsidiaries, and (ii) derived from or constitute
improvements to the Licensed Patents and/or the Licensed Technical
Information.
"LICENSEE's Patents" shall mean all patents issued or issuing on
patent applications entitled to an effective filing date prior to five (5)
years after the Effective Date that are: (i) licensable at any time by
LICENSEE or any of its Subsidiaries, and (ii) derived from or constitute
improvements to the Licensed Patents and/or the Licensed Technical
Information. LICENSEE's Patents also include foreign counterparts to such
patents, if any, and any divisions, extensions, continuations or
continuations-in-part thereof.
"Licensed Patents" shall mean the patents listed in Exhibit A and IBM
Improvement Patents (and their foreign counterparts, if any) and any
divisions, extensions, continuations or continuations-in-part thereof.
"Lasertron Agreement" shall mean the license agreement dated August 1,
1994, between IBM and Lasertron, Inc.
"Licensed Business Information" shall mean any and all business
information used prior to the Effective Date in the conduct of the Laser
Operations, such as customer information, pricing and cost information,
strategic product plans and the like, which relates to Licensed Products.
Licensed Business Information may be in tangible or intangible form.
"Licensed Information" shall mean Licensed Business Information and
Licensed Technical Information.
"Licensed Products" shall mean R-F Products and R-B Products.
"Licensed Technical Information" shall mean any and all IBM technical
information, mask works, data, formulas, knowledge, processes and/or trade
secrets developed or acquired by IBM relating to the design, testing and
manufacture of Licensed Products which is used by IBM in the conduct of the
Laser Operations and which includes, without limitation, the IBM technical
information described in the documents listed in Exhibit B. Licensed
Technical Information does not include any computer programs.
"Red Lasers" shall mean indium gallium phosphorus/ aluminum gallium
indium phosphorus/ aluminum gallium arsenide semiconductor laser chips
emitting red light at about 670nm, and having an ordered phase quantum
well, dry etched ridge-type structure and aluminum gallium arsenide
cladding layers.
"Royalty-Bearing Products" or "R-B Products" shall mean Red Lasers,
1300nm Lasers and any other semiconductor laser chips made using Full Wafer
Technology.
"Royalty-Free Products" or "R-F Products" shall mean semiconductor
laser chips comprising a gallium arsenide substrate and an active region
composed of gallium indium arsenide, gallium arsenide or gallium aluminum
arsenide.
"Second Source" shall mean a single manufacturing location, other than
the Facility, which is: (i) located in the US or Europe and (ii) wholly-
owned by LICENSEE.
"Selling Price" shall mean the actual selling price to unaffiliated
customers, and the greater of actual selling price or fair market value in
sales to affiliated customers; provided that in either case the Selling
Price shall be reduced for discounts, taxes, transportation fees and other
unreimbursed charges paid by LICENSEE or its Subsidiaries in connection
with the sale of Licensed Products.
"Subsidiary" shall mean a corporation, company or other entity:
(a) more than fifty percent (50%) of whose outstanding shares or
securities (representing the right to vote for the election of
directors or other managing authority) are, now or hereafter,
owned or controlled, directly or indirectly, by a party hereto,
but such corporation, company or other entity shall be deemed to
be a Subsidiary only so long as such ownership or control exists;
or
(b) which does not have outstanding shares or securities, as may be
the case in a partnership, joint venture or unincorporated
association, but more than fifty percent (50%) of whose ownership
interest representing the right to make the decisions for such
corporation, company or other entity is, now or hereafter, owned
or controlled, directly or indirectly, by a party hereto, but
such corporation, company or other entity shall be deemed to be a
Subsidiary only so long as such ownership or control exists.
"1300nm Lasers" shall mean indium phosphide/ indium gallium arsenide
phosphide semiconductor laser chips emitting light at about 1300nm, having
a simple double heterostructure with a thin active layer, and a self-
aligned ridge structure made by the GRUNT process.
Section 2.0 License Grants
2.1 Subject to Sections 2.5 and 2.9, IBM grants to LICENSEE and its
Subsidiaries, to the extent that it has a right to do so, a nonexclusive
right and license to use the Licensed Information to: (i) make and have
made Licensed Products only at the Authorized Locations and sell such
products worldwide; (ii) to use and make any apparatus (other than the E2
prototype tool) required to manufacture Licensed Products only at the
Authorized Locations; and (iii) improve, modify and enhance the Licensed
Information and to use and incorporate any such improvements, modifications
and enhancements in the exercise of the license rights pursuant to clause
(i) and (ii) and Section 2.11 below. Subject to the last sentence of
Section 2.3 hereof, the foregoing license rights shall include the right to
sell and distribute any product that includes a Licensed Product as a
component or subassembly thereof. Providing IBM receives the payment
specified in Section 4.1, the license granted in this Section 2.1 with
respect to R-F Licensed Products shall be royalty-free and fully paid-up.
The license granted in this Section 2.1 with respect to R-B Licensed
Products shall be royalty-bearing as provided in Section 4.2.
2.2 Subject to licenses granted to third parties prior to the Effective
Date and a license retained by IBM for itself and its Subsidiaries to use,
copy, modify and distribute internally, IBM hereby transfers, assigns and
conveys to LICENSEE all of IBM's right, title and interest in and to those
computer programs used at the Facility and identified in Exhibit C-1
hereto. IBM hereby grants to LICENSEE, to the extent it has a right to do
so, a nonexclusive, paid-up and royalty-free license under copyrights, or
other similar rights for computer programs, to use, execute, reproduce,
modify, and prepare derivative works based upon the additional computer
programs listed in Exhibit C-2, only at the Authorized Locations.
2.3 Providing IBM receives the payment specified in Section 4.1, IBM
hereby grants to LICENSEE a nonexclusive, paid-up and royalty-free license
under the Licensed Patents to make and have made R-F Licensed Products at
the Authorized Locations and to use, offer to sell, sell and import
R-F Licensed Products worldwide. The foregoing license shall not extend to
any infringement of IBM patents not licensed hereunder resulting from the
combination of Licensed Products with other products not licensed herein.
The term of the license granted in this Section 2.3 shall be for a period
of five (5) years from the Effective Date, unless LICENSEE exercises the
option granted in Section 2.6 and makes the payment specified therein, in
which event the term of the license shall be extended to the date of
expiration of the last to expire of the Licensed Patents.
2.4 Except as specifically granted in this Section 2.0, no license or
other right is granted, either directly or indirectly, by implication,
estoppel or otherwise, to LICENSEE with respect to any patents or patent
applications, trademarks, copyrights, trade secrets, computer programs,
know-how, mask works or other intellectual property rights of IBM.
2.5 The license to have Licensed Products made by another manufacturer
granted in Sections 2.1 and 2.3 to LICENSEE shall only apply when the
specifications for Licensed Products were created by LICENSEE (either
solely or jointly with one or more third parties); and shall not apply to
any Licensed Products in the form manufactured or marketed by said other
manufacturer prior to LICENSEE furnishing said specifications.
2.6 IBM grants to LICENSEE an option to obtain a fully paid-up extension
of the term of the patent license granted in Section 2.3 with respect to
R-F Licensed Products to cover the period extending to the date of
expiration of the last to expire of the Licensed Patents. This option may
be exercised at any time prior to five (5) years from the Effective Date by
LICENSEE paying to IBM the sum of nine million US dollars ($9,000,000) and
giving written notice of the exercise of the option in accordance with
Section 7. Communications.
2.7 LICENSEE hereby grants to IBM an irrevocable, worldwide, nonexclusive,
paid-up and royalty-free license under LICENSEE's Patents to make, have
made, use, offer to sell, sell and import R-F Licensed Products. IBM shall
have no right to grant sublicenses under LICENSEE's Patents, except to its
Subsidiaries.
2.8 In the event that LICENSEE identifies in writing to IBM any patents
licensable by IBM which are necessarily infringed by the exercise of the
license granted in Section 2.1 with respect to R-F Licensed Products being
manufactured at the Facility on the Effective Date, and IBM, after a good
faith analysis, agrees with LICENSEE's position, then upon IBM's written
notification, Exhibit A shall be automatically amended to include such
additional patents without further charge to LICENSEE. In the event that
IBM shall determine for any reason that such infringement will not occur as
to a licensable IBM patent, IBM shall thereafter be estopped from making
any claims of infringement against LICENSEE, its Subsidiaries or its
customers as to such IBM patent for any exercise by LICENSEE of its rights
under Section 2.1 above.
2.9 Notwithstanding anything to the contrary, the license granted in
Section 2.1 shall not include rights to use any designs or other
information which are used exclusively to manufacture products for IBM.
2.10 Subject to the restrictions limiting the license rights to Authorized
Locations, LICENSEE shall have the right to exercise any license rights
granted hereunder through any Subsidiary, and any reference in this
Section 2 and Section 3 below to LICENSEE shall be deemed to refer to any
Subsidiary through which LICENSEE shall so exercise such license rights.
2.11 LICENSEE shall have the further right to use the Licensed Technical
Information relating to Royalty Free Products in the development and
manufacture of any semiconductor laser chips and to exercise the license
rights specified in Section 2 as to any such semiconductor laser chips
without payment of any royalty pursuant to Section 4.2 hereof, subject to
the limitations and restrictions contained in this Agreement and the
payment of any patent royalties, as applicable.
2.12 For so long as IBM continues to manufacture the E2 Prototype Tool (the
"E2 Tool") for sale to any third party, IBM agrees to sell to LICENSEE E2
Tools on terms no less favorable than IBM has sold E2 Tools during the
preceding twelve (12) months to any other non-IBM customer purchasing
equivalent quantities of the E2 Tool as LICENSEE. Such most favored terms
shall include price, production allocation, functionality of the E2 Tool
and payment terms and shall be granted to LICENSEE upon the condition that
LICENSEE accept all material terms upon which such most favored customer
purchased the E2 Tool. In the event such most favored terms shall not
apply, IBM agrees to sell E2 Tools to LICENSEE on commercially reasonable
terms.
Upon written request by LICENSEE and in the event that IBM is no longer in
the business of supplying E2 Tools to third parties, IBM shall provide
LICENSEE with component part drawings and any other technical information,
including all improvements, necessary for the manufacture and operation of
E2 Tools, to the extent IBM can provide such information without violating
any obligations to third parties, at a reasonable cost invoiced to LICENSEE
to cover associated procurement expenses, and LICENSEE shall have the
nonexclusive right to manufacture E2 Tools for LICENSEE's internal use and
that of its Subsidiaries. Any manufacture of the E2 Tool, or any portion
thereof, by LICENSEE may require additional patent licenses which the
parties agree to negotiate in good faith.
IBM shall make a good faith effort to notify LICENSEE of its intention to
stop manufacturing E2 Tools to third parties at least three (3) months
prior to the date it plans to stop such manufacture, and agrees to promptly
respond to all reasonable written requests from LICENSEE as to whether it
intends to stop such manufacture.
2.13 IBM disclaims any common law trademark rights that it may have
acquired through the use of the "E2" designation. To the extent that IBM
has acquired any common law trademark rights in the "Laser Enterprise" or
"LE" designation, IBM hereby assigns all such rights to LICENSEE, together
with all goodwill pertaining thereto.
2.14 In the event that IBM now or hereafter obtains any patents which would
necessarily be infringed by the assembly by LICENSEE's customers of Royalty-
Free Products into an Erbium Doped Optical Fiber Amplifier ("EDFA")
configuration or EDFA architecture compliant package, IBM agrees to make a
license under such patents available to LICENSEE's customers in accordance
with IBM's licensing practices at such time.
Section 3.0 Confidentiality
3.1 For a period of ten (10) years from the Effective Date, LICENSEE
agrees to use the same degree of care and discretion, but at least a
reasonable level of care and discretion, to avoid any disclosure,
publication, or dissemination of any part or all of the Licensed
Information outside of LICENSEE, and its Subsidiaries, as LICENSEE employs
with information of its own which it regards as confidential and which it
does not desire to publish, disclose or disseminate. If any Licensed
Information of a third party requires a different standard of care or
different period of confidentiality than that specified above, LICENSEE
agrees to protect such third party's Licensed Information in accordance
with the terms of the agreement under which such information was received
by IBM.
3.2 Disclosure of Licensed Information shall not be precluded, if such
disclosure is:
(a) in response to a valid order of a court or other governmental
body; provided, however, that LICENSEE shall first have given
notice to IBM and made a reasonable effort to obtain a protective
order requiring that the information and/or documents so
disclosed be used only for the purposes for which the order was
issued;
(b) otherwise required by law;
(c) reasonably necessary to establish rights under this Agreement
(but only to the extent necessary to do so); or
(d) reasonably necessary to exercise LICENSEE's license rights
hereunder and such disclosure is made to an entity or other
person that is bound as to the nondisclosure of such Licensed
Information by a written agreement that is no less restrictive
than this Section 3.
3.3 No obligation of confidentiality shall attach to:
(a) any information that LICENSEE already possesses without
obligation of confidentiality;
(b) any information LICENSEE rightfully receives from another without
obligation of confidentiality; or
(c) any information that is, or becomes, publicly available without
breach of this Agreement.
3.4 In the event that LICENSEE discovers any IBM confidential information
in the possession of Employees that is unrelated to the Licensed Products,
it will promptly return such information to IBM.
3.5 IBM agrees not to disclose the trade secret information described in
( Information redacted and filed separately. )
for a period of three (3) years from the Effective Date subject to
Sections 3.2(a) & (b). IBM agrees not to disclose the trade secret
information relating to the process (
Information redacted and filed separately.
) for a period of two (2) years from the
Effective Date subject to Sections 3.2(a) & (b). Notwithstanding the
above, neither (i) the inherent disclosure of such information in IBM's
products, nor (ii) the disclosure of such information as part of a
disclosure of process information relating to products other than Royalty-
Free Products and Royalty-Bearing Products shall be deemed to be a
violation of this Section 3.5.
Section 4.0 Consideration
4.1 As partial consideration for the licenses granted by IBM to LICENSEE
in Sections 2.1, 2.2 and 2.3 with respect to R-F Products, LICENSEE shall
pay IBM the amount of twenty-seven million US dollars (US $27,000,000), on
the Effective Date, which sum is nonrefundable, in accordance with
instructions to be provided by IBM prior to such date.
4.2 As partial consideration for the licenses granted by IBM to LICENSEE
in Sections 2.1 and 2.2 with respect to R-B Products, LICENSEE shall pay
IBM a royalty of five percent (5%) of Selling Price. LICENSEE acknowledges
that any royalties owing for patents covering R-B Products shall be payable
in addition to the royalty specified herein, pursuant to a separate patent
license agreement between the parties.
4.3 LICENSEE shall bear and pay all taxes (including, without limitation,
sales and value added taxes) imposed by any national, provincial or local
government of any country in which LICENSEE is doing business as a result
of the existence of this Agreement or the exercise of rights hereunder;
provided, that the foregoing shall not obligate LICENSEE to pay any tax
based on the income, gross receipts or property of IBM.
4.4 LICENSEE shall be liable for interest on any overdue payment or
royalty, commencing on the date such payment or royalty was due and ending
upon payment by LICENSEE, at an annual rate which is the greater of ten
percent (10%) or one percentage point higher than the prime interest rate
as quoted by the head office of Citibank N.A., New York, at the close of
banking on such date, or on the first business day thereafter if such date
falls on a non-business day. If such interest rate exceeds the maximum
legal rate in the jurisdiction where a claim therefore is being asserted,
the interest rate shall be reduced to such maximum legal rate.
4.5 Royalties shall accrue when an R-B Licensed Product, with respect to
which royalty payments are required by this Agreement, is first sold or
otherwise transferred to a party other than LICENSEE or its Subsidiaries
(including, except as otherwise agreed in writing by IBM, sold or otherwise
transferred to IBM or any of its Subsidiaries). To the extent an
R-B Licensed Product is incorporated as a component, subassembly or
subsystem in another product, the Selling Price shall be determined based
on the published list price (or if no such published list price exists, the
fair market value) of such R-B Licensed Product exclusive of any other
portion of such product.
4.6 LICENSEE shall pay all royalties and other payments due hereunder in
United States dollars. All royalties for an accounting period computed in
other currencies shall be converted into United States dollars at the
exchange rate for bank transfers from such currency to United States
dollars as quoted by the head office of Citibank N.A., New York, at the
close of banking on the last day of such accounting period (or the first
business day thereafter if such last day shall be a non-business day).
4.7 LICENSEE's accounting period shall be semiannual and shall end on the
last day of each June and December during the term of this Agreement.
Within sixty (60) days after the end of each such period LICENSEE shall
furnish to IBM a written report containing the information specified in
Section 4.8 and shall pay to IBM all unpaid royalties accrued hereunder to
the end of each such period. Such payments will be nonrefundable.
4.8 LICENSEE's written report shall be certified by an officer of LICENSEE
and shall contain the following information:
(a) for each type of R-B Licensed Product upon which royalty has
accrued: a description of said R-B Licensed Product, the
quantity sold or otherwise transferred during the accounting
period, and the sum of the Selling Price for such quantity; and
(b) the aggregate amount of all royalties due.
In the event no royalties are due, LICENSEE's report shall so state.
4.9 LICENSEE shall keep records in accordance with generally accepted
accounting principles and in sufficient detail to permit the determination
of which products are subject to royalty payments under this Agreement, the
royalties due IBM, and the accuracy of the information on LICENSEE's
written reports. Such records shall include, but not be limited to,
detailed records supporting the information provided under Section 4.8.
Such records shall be kept for six (6) years following the due date for the
report relating to the reporting period to which such records pertain.
Upon IBM's written request for an audit, LICENSEE shall permit auditors
designated by IBM, together with such legal and technical support as IBM
deems necessary, to examine, during ordinary business hours, records,
materials, and manufacturing processes of LICENSEE for the purpose of
determining royalties due IBM.
Such audit shall be restricted to an audit of those records, materials, and
manufacturing processes related to R-B Licensed Products. Such records and
materials shall be deemed to include general financial information to
provide a cross-check for the amount of royalties reported.
LICENSEE shall provide its full cooperation in such audit. Such
cooperation shall include, but not be limited to, providing sufficient time
for such examination and convenient access to relevant personnel and
records.
Each party shall pay the charges that it incurs in the course of the audit.
However, in the event that the audit establishes underpayment greater than
or equal to the lesser of: five percent (5%) of the royalties which should
have been paid for the accounting periods being audited or the cost of the
audit, then LICENSEE shall reimburse IBM for the costs IBM incurred in
conducting such audit. However, such costs shall not include salaries paid
to IBM employees associated with such audit and such reimbursement shall
not exceed the amount of underpayment.
4.10 In the event an audit under the provisions of Section 4.9 identifies
an underpayment of royalties by LICENSEE, LICENSEE shall pay an amount
equal to the sum of such underpayment, any interest due under the
provisions of Section 4.4, and any reimbursement to IBM for the costs IBM
incurred in conducting such audit as specified by Section 4.9, within sixty
(60) days of IBM's written request. Reimbursements due for costs shall
also be subject to interest under the provisions of Section 4.4.
4.11 IBM agrees that any statements or audit results furnished or otherwise
made available to or obtained by IBM pursuant to this Section 4.0 shall be
subject to equivalent confidentiality restrictions set forth in Section 3
and shall not be disclosed by IBM for a period of three (3) years from the
date of disclosure.
Section 5.0 Term; Termination and Assignability
5.1 The licenses granted in Sections 2.1 and 2.2 with respect to Licensed
Products shall remain in effect unless terminated in accordance with this
Section 5.0. The patent license granted in Section 2.3 with respect to
R-F Licensed Products shall remain in effect for a period of five (5) years
from the Effective Date, unless terminated in accordance with this
Section 5 or extended pursuant to the option granted in Section 2.6. The
patent license granted to IBM in Section 2.7 shall remain in effect for a
period of five (5) years from the Effective Date.
5.2 If LICENSEE is in material breach of its obligations hereunder with
respect to R-B Licensed Products and IBM provides written notice to
LICENSEE specifying the nature of such breach, LICENSEE shall either cure
such breach or produce a plan for such cure reasonably acceptable to IBM
within sixty (60) days after such written notice. If LICENSEE does not
provide a plan for cure, or comply with a plan reasonably acceptable to
IBM, IBM shall have the right to terminate the licenses granted to LICENSEE
with respect to R-B Licensed Products under this Agreement by giving
written notice of termination to LICENSEE. For purposes of this
Section 5.2, a material breach by LICENSEE shall mean and be limited to:
(i) an intentional and continuing breach of its obligations under Section 3
hereof or of the license restrictions in Section 2 hereof with respect to
Licensed Information relating to R-B Licensed Products; (ii) LICENSEE being
more than fifty thousand dollars ($50,000) in arrears on its payment
obligations herein that are not otherwise subject to a good faith dispute
between IBM and LICENSEE; or (iii) the failure by LICENSEE to submit
reports or permit audits as specified in Section 4.
5.3 If LICENSEE is in material breach of its obligations hereunder with
respect to R-F Licensed Products and IBM provides written notice to
LICENSEE specifying the nature of such breach, LICENSEE shall either cure
such breach or produce a plan for such cure reasonably acceptable to IBM
within sixty (60) days after such written notice. If LICENSEE does not
provide a plan for cure, or comply with a plan reasonably acceptable to
IBM, IBM shall have the right to terminate the licenses granted to LICENSEE
with respect to R-F Licensed Products under this Agreement by giving
written notice of termination to LICENSEE. For purposes of this
Section 5.3, a material breach by LICENSEE shall mean and be limited to an
intentional and continuing breach of its obligations under Section 3 hereof
or of the license restrictions in Section 2 hereof with respect to Licensed
Information relating to R-F Licensed Products.
5.4 In addition, in the event that LICENSEE engages in or suffers any of
the following events of default:
(a) becomes insolvent, is dissolved or liquidated, files or has filed
against it a petition in bankruptcy, reorganization, dissolution
or liquidation or similar action filed by or against it, is
adjudicated as bankrupt, or has a receiver appointed for its
business; or
(b) has all or a substantial portion of its capital stock or assets
expropriated or attached by any government entity;
then LICENSEE shall promptly notify IBM in writing that such event has
occurred. If any default as specified above in this Section 5.3 is not
cured, or an acceptable plan for such cure is not proposed within ninety
(90) days after written notice from IBM specifying the nature of the
default, IBM shall have the right to terminate this Agreement by giving
written notice of termination to LICENSEE.
5.5 This Agreement and any rights or licenses granted herein are personal
to the parties and neither shall assign or sublicense any of its rights or
privileges hereunder. Any attempted act in derogation of the foregoing
shall be considered void. Notwithstanding the foregoing, in the event of a
transfer by LICENSEE of all or substantially all of its assets or those of
the Laser Operations, LICENSEE shall have the right to assign this
Agreement to the purchaser of such assets, provided: (i) such purchaser
agrees in writing to be bound by all terms and conditions hereof, (ii) in
the event that such purchaser and IBM are involved in any intellectual
property dispute at the time of such transfer, such purchaser shall resolve
such dispute to IBM's satisfaction; both as conditions precedents to the
effectiveness of such assignment.
5.6 No failure or delay on the part of IBM in exercising its right of
termination hereunder for any one or more causes shall be construed to
prejudice its right of termination for such causes or any other or
subsequent causes.
5.7 Upon termination of this Agreement, all licenses granted in Section 2
will automatically terminate, and LICENSEE shall promptly return to IBM or
destroy all tangible information containing Licensed Information. The
confidentiality obligations of Section 3 will remain in effect beyond any
termination for the time period stated in Section 3.1.
Section 6.0 Representations and Warranties
6.1 IBM represents and warrants that:
(a) it has the full right and power to grant the licenses set forth
in Section 2, that there are no outstanding agreements,
assignments, or encumbrances inconsistent with the provisions of
said licenses or with any other provisions of this Agreement;
(b) in the last two years it has not received any written claim or
written notice from any third party alleging infringement or
unauthorized use of any intellectual property rights owned by
such party in relation to the Laser Operations;
(c) to the personal knowledge of the four most senior level
executives among the Employees, as expressed to LICENSEE prior to
the signing of this Agreement during due diligence, they do not
believe the operation of the Laser Enterprise, as operated by IBM
immediately prior to the Effective Date, infringes or makes
unauthorized use of any intellectual property rights of any third
party;
(d) subject to LICENSEE's compliance with all limitations and/or
conditions contained in this Agreement and any of the other
agreements relating to the sale of assets relating to the Laser
Enterprise, LICENSEE shall be entitled to continue the operations
of the Laser Enterprise, as being conducted by IBM on the
Effective Date, without claim of infringement or other
misappropriation of intellectual property rights by IBM or any of
its Subsidiaries as to patent, copyrights, trade secret or other
intellectual property rights owned by or licensed to IBM or any
of its Subsidiaries; and
(e) to the personal knowledge of the most senior level executive
among the Employees, IBM has not since March 1, 1995, licensed
any improvements to the Licensed Technical Information relating
to the Royalty-Free Products to any third party which was
licensed by IBM prior to said date to manufacture Royalty-Free
Products.
6.2 EXCEPT AS PROVIDED IN SECTION 6.1, NEITHER PARTY MAKES ANY OTHER
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED
TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE, NOR DOES EITHER PARTY ASSUME ANY LIABILITY IN RESPECT OF ANY
INFRINGEMENT OF PATENTS OR OTHER RIGHTS OF THIRD PARTIES DUE TO THE OTHER
PARTY'S OPERATION UNDER THE LICENSES HEREIN GRANTED.
6.3 IBM's liability for breach of any of the representations and
warranties set forth above shall be subject to Section 7.2 of the Purchase
Agreement.
Section 7.0 Communications
7.1 All payments due after the Effective Date shall be made by electronic
funds transfer. Any notice or other communication required or permitted to
be made or given to either party hereto pursuant to this Agreement shall be
sent to such party by facsimile or by registered airmail (except that
registered or certified mail may be used where delivery is in the same
country as mailing), postage prepaid, addressed to it at its address set
forth below, or to such other address as it shall designate by written
notice given to the other party. Payments shall be deemed to be made on
the date of electronic funds transfer. Notices or other communications
shall be deemed to have been given or provided on the date of sending. The
addresses are as follows:
(a) For electronic funds transfers of payments:
IBM Director of Licensing
The Bank of New York
48 Wall Street
New York, New York 10286
United States of America
Credit Account No. 890-0209-674
ABA No. 0210-0001-8
(b) For mailing to IBM:
Director of Licensing
International Business Machines Corporation
500 Columbus Avenue
Thornwood, New York 10594
United States of America
(c) For facsimile transmission to IBM:
(914) 742-6737
(d) For mailing to LICENSEE:
Director, Intellectual Property
Uniphase Corporation
163 Baypointe Parkway
San Jose, CA 95134
(e) For facsimile transmission to LICENSEE:
(408) 954-0540
Section 8 Applicable Law
8.1 This Agreement shall be construed, and the legal relations between the
parties hereto shall be determined, in accordance with the internal laws of
the State of New York, United States of America, applicable to agreements
made and to be performed entirely within such state, without regard to the
conflicts of laws principles of such state.
8.2 Each of the parties waives its right to a jury trial and consents to
the jurisdiction of any state or federal court located within the State of
New York. Each of the parties hereby: (i) waives trial by jury,
(ii) waives any objection to venue of any action instituted hereunder and
(iii) consents to the granting of such legal or equitable relief as is
deemed appropriate by any aforementioned court.
Section 9 Miscellaneous
9.1 This Agreement may be executed by the parties hereto in one or more
counterparts, each of which shall be an original and all of which shall
constitute one and the same instrument.
9.2 Nothing contained in this Agreement shall be construed as conferring
any right to use in advertising, publicity, or other promotional activities
any name, trade name, trademark, trade dress or other designation of either
party hereto (including any contraction, abbreviation or simulation of any
of the foregoing), save as expressly stated herein. Each party hereto
agrees not to use or refer to this Agreement or any provision hereof in any
promotional activity associated with apparatus licensed hereunder, without
the express written approval of the other party.
9.3 LICENSEE agrees not to export or re-export, or cause to be exported or
re-exported, any technical data received hereunder, or the direct product
of such technical data, to any country or person which, under the laws of
the United States, are or may be prohibited from receiving such technical
data or the direct product thereof.
9.4 This Agreement will not be binding upon the parties until it has been
signed herein below by or on behalf of each party, and in which event it
shall be effective as of the Effective Date. No amendment or modification
hereof shall be valid or binding upon the parties unless made in writing
and signed as aforesaid. This Agreement embodies the entire understanding
of the parties with respect to the subject matter hereof and merges all
prior discussions between them, and neither of the parties shall be bound
by any conditions, definitions, warranties, understandings or
representations with respect to the subject matter hereof other than as
expressly provided herein.
9.5 The headings of the several Sections are inserted for convenience of
reference only and are not intended to be a part of or to affect the
meaning of interpretation of this Agreement.
9.6 If any Section of this Agreement is found by competent authority to be
invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such Section in every other
respect and the remainder of this Agreement shall continue in effect so
long as the Agreement still expresses the intent of the parties. If the
intent of the parties cannot be preserved, this Agreement shall be either
renegotiated or terminated.
9.7 In the event that Lasertron, Inc. requests IBM to provide any wafers
pursuant to the Lasertron Agreement within one (1) year from the Effective
Date, LICENSEE agrees that it will enter into suitable arrangements with
IBM to provide such wafers under the terms and conditions set forth in the
Lasertron Agreement, which terms and conditions are appended as Exhibit D.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly signed as of the date first written above.
UNIPHASE CORPORATION INTERNATIONAL BUSINESS MACHINES
CORPORATION
By \s\ Danny E. Pettit By \s\ Suzanne C. Lewis
Name Danny E. Pettit Name Suzanne C. Lewis
Title Vice President, Finance Title Business Development
& CFO Consultant
EXHIBIT A
LICENSED PATENTS
Issue or File
Patent/Application Date
Number (DD/MM/YY)
5,154,333 13/10/92
5,305,340 04/19/94
5,311,539 10/05/94
5,391,036 21/02/95
5,301,202 05/04/94
5,498,973 12/03/96
4,995,539 26/02/91
5,029,555 09/07/91
5,063,173 05/11/91
5,144,634 01/09/92
5,059,552 22/10/91
5,171,717 15/12/92
4,805,179 14/02/89
5,185,289 09/02/93
5,280,535 18/01/94
5,319,725 07/06/94
5,376,582 27/12/94
5,414,293 09/05/95
5,516,727 14/05/96
5,594,749 14/01/97
Appl. 721072 26/09/96
PCT/IB97/00055 27/01/97
EXHIBIT B
LICENSED TECHNICAL INFORMATION
I LICENSED TECHNICAL INFORMATION FOR ROYALTY FREE PRODUCTS
Process
Documentation, as is, for each process used in the development and
fabrication of the following royalty free laser products and the
detailed procedure for carrying out each step of the fabrication.
Descriptions identify the tools and equipment used, and specifies the
in-process tests that are performed.
QUALIFIED IN UNDER DEVELOPMENT
QUALIFICATION
* 980 nm L-N * 980 nm * 980 nm narrow
series (narrow lasers for stripe laser
stripe lasers) submarine (300mW)
- 120mW (linear (70mW) * 920...1020 nm
power) * 956 nm narrow stripe
- 150mW broad area lasers
- 180mW lasers (0.5) (150...210mW)
- 210mW Watt) * 910...980 nm
broad area lasers
(1W,4W)
Process Materials
Documentation, as is, for all materials used when making IBM's royalty
free laser products, including information concerning vendors,
material grades, and part numbers,
Process Tools
Documentation, as is, for tools employed when making IBM's laser
chips. This information comprises drawings and/or blueprints for jigs
and tools such as the barhandler, facet coater, and bar tester, vacuum
chuck, as well as details concerning the tools for lithography,
etching and deposition, tools for material characterization and so
forth.
Video Tapes
Tapes illustrating various process steps.
Reliability Database
Reliability data on IBM's royalty free products in computer readable
form.
Mask Set used for royalty free laser products processing
1) Laser - Development ZRL
CSP Groove
CSP NAM
CVWAFMAP
FUWA1
FUWA2
INP1
LASER1
LASER1P
LASER2 (NEXUS)
LASER3
LASER4 (KORINTH)
LASERX
PULSE1
REDARRAY
SEGLASER
SCLLD1
PASSAGE
VELNAM
T2V2
T3V1
T13V1
T14V1
SOF1
KOKIPHOT
2) Laser - Rests from EF
RUESCHLIKON5170-5178
FUWA113
T2 LASER
RS
EPNPB
PROTECT
GOT2
RUSHT2
PULSE
PAIRARC
PASSAGE
INP TO
LASERX
TTRNRN
TNMETRP
TVIAPR-VIA
RIDGE LASER
METALR
TRIDRP
TPMETRN
TPMETRP
RID2CN
RID2CP
G2 PRIME
E2 Prototype Tool
Documentation, as is, for operation/maintenance of E2 Tool
- Assembly drawings, schematics, commercial components, spare parts
- Set-up manuals
II LICENSED TECHNICAL INFORMATION FOR ROYALTY BEARING PRODUCTS:
Documentation, as is, for:
- Full Wafer Technology_A batch processing technique capable of
producing more than one edge emitting semiconductor lasers
simultaneously.
- Red Lasers_Indium gallium phosphorus/aluminum gallium indium
phosphorus/aluminum gallium arsenide semiconductor laser chips
emitting red light at about 670nm, and having a quantum well
ridge-type structure and aluminum gallium arsenide cladding
layers.
- 1300nm Lasers_Indium phosphorus/indium gallium arsenide
phosphorus semiconductor laser chips emitting light at about
1300nm and having a double heterostructure or quantum well
structure.
EXHIBIT C
NON-COMMERCIAL COMPUTER PROGRAMS USED AT THE FACILITY
C-1 ASSIGNED PROGRAMS
1) Autobar Tester Software (BT2MESS and BT2ANA, home build)
2) Waveguide/optical simulation (MODE, home build)
3) Laser Lifetest (home build)
4) Thermal device simulation (HEAT, home build)
5) Heat flow modeling (HETMOD, home build)
6) Device simulation (MONTE on AIX)
7) Waveguide simulation (WAGSI)
8) Epi software for running the MBE and CBE system (home build)
9) Software for ESCA system (home build)
10) Quick turnaround Device test software (QTAT, home build)
11) [intentionally left blank]
12) Photo Luminescence software (home build)
C-2 LICENSED PROGRAMS
ISP Laser Cleaver Tool Program
EXHIBIT D
Exhibit G to the Lasertron Agreement follows this page.
EXHIBIT G
WAFER MATERIAL
Till end of 1996 IBM will provide qualified and non-qualified epitaxially
grown wafers to LT. Non-qualified epitaxially grown wafers are wafers out
of specification. IBM is not committed to sell more than the maximum
number of wafers given in the below tables. In 1997, epitaxially grown
wafers will be sold to LT only if LT placed an order in 1996, such that IBM
is able to grow those wafers in 1996. Such an advanced order shall include
any information on the specification and structure necessary to grow the
wafers as well as the number of wafers needed by LT. IBM is not committed
to sell any wafer material in 1998 and later. The terms and conditions of
this bridge offering are as follows:
Qualified epitaxially grown wafers (3 quarters per wafer)
Year Price per wafer price per wafer maximum number/year
(0 - 25 wafers) (26 - 50 wafers)
1995 ( * ) ( * ) ( * )
1996 ( * ) ( * ) ( * )
1997(1) ( * )
(1) Subject to order by LT in 1996: price on request only.
* - Information redacted and filed separately with the SEC.
Non-qualified epitaxially grown wafers (2) (3 quarters per wafer)
Year Price per wafer
(0 - 20 wafers)
1995 ( * )
1996 ( * )
1997(3)
(2) Will be sold on the base of availability only.
(3) Subject to order by LT in 1996: price on request only.
* - Information redacted and filed separately with the SEC.
i
030897
PATENT LICENSE AGREEMENT ("Agreement") with an Effective
Date of March 10, 1997 between INTERNATIONAL BUSINESS MACHINES CORPORATION,
a New York corporation ("IBM"), and UNIPHASE CORPORATION, a Delaware
corporation ("LICENSEE").
Contemporaneously with the execution of this Agreement, the parties
have entered into a Technology License Agreement which includes, in part, a
license under certain technology owned by IBM to manufacture and sell
Royalty-Bearing Products (as defined in such Technology License Agreement).
The exercise of such technology license by LICENSEE may require a license
under the IBM patents listed in Exhibit 1 (the "Licensed Patents").
LICENSEE desires to acquire a nonexclusive license under the Licensed
Patents for such Royalty-Bearing Products.
In consideration of the premises and mutual covenants herein contained, IBM
and LICENSEE agree as follows:
Section 1. Definitions
1.1 "Patented Portion" shall mean that portion of a Product which:
(a)embodies or uses all the elements or steps recited in any one Claim of
one Licensed Patent; or
(b)is manufactured by use of all the steps recited in any one Claim of one
Licensed Patent.
1.2 "Products" shall mean semiconductor laser chips other than Royalty-
Free Products (as defined in the Technology License Agreement).
1.3 "Selling Price" shall mean the actual selling price to unaffiliated
customers, and the greater of actual selling price or fair market value in
sales to affiliated customers; provided that in either case the Selling
Price shall be reduced for discounts, taxes, transportation fees and other
unreimbursed charges paid by LICENSEE or its Subsidiaries in connection
with the sale of Products.
1.4 "Subsidiary" shall mean a corporation, company or other entity:
(a)more than fifty percent (50%) of whose outstanding shares or securities
(representing the right to vote for the election of directors or
other managing authority) are, now or hereafter, owned or controlled,
directly or indirectly, by a party hereto, or
(b)which does not have outstanding shares or securities, as may be the case
in a partnership, joint venture or unincorporated association, but
more than fifty percent (50%) of whose ownership interest representing
the right to make the decisions for such corporation, company or other
entity is now or hereafter, owned or controlled, directly or
indirectly, by a party hereto, but such corporation, company or other
entity shall be deemed to be a Subsidiary only so long as such
ownership or control exists.
1.5 "Claim" shall mean an allowed claim under a Licensed Patent that has
not expired or been adjudicated invalid.
Section 2. License
2.1 IBM grants to LICENSEE and its Subsidiaries a nonexclusive license
under the Licensed Patents to make, use, import, offer to sell, sell and
otherwise transfer Products. The license as to any Subsidiary shall
terminate on the date such Subsidiary ceases to be a Subsidiary.
Additionally, subject to Section 2.4, IBM grants to LICENSEE and its
Subsidiaries a nonexclusive license under the Licensed Patents the right to
have LICENSEE's Products made by another manufacturer for the use and/or
lease, sale or other transfer only by LICENSEE and its Subsidiaries. Such
license shall further include the right to incorporate Products as
components, subassemblies or subsystems in other products manufactured
and/or sold by LICENSEE and its Subsidiaries.
2.2 No license is granted pursuant to Section 2.1 with respect to any
particular Product, unless:
(a)a Licensed Patent defines a Patented Portion of said Product;
(b)said Licensed Patent is identified in a report as covering said Product,
if required by Section 4.5; and
(c)either the royalty attributable to said Product is paid as required by
Section 4.2, or a late payment of said royalty is made and accepted by
IBM pursuant to Section 4.4.
2.3 No license, immunity or other right is granted under this Agreement,
either directly or by implication, estoppel, or otherwise:
(a)other than under the Licensed Patents;
(b)with respect to any item other than a Product notwithstanding that such
other item may incorporate one or more Products; or
(c)to parties acquiring any item from LICENSEE or its Subsidiaries for the
combination of such acquired item with any other item, including other
items provided by LICENSEE or its Subsidiaries, or for the use of any
such combination even if such acquired item has no substantial use
other than as part of such combination.
2.4 The license to have Products made granted in Section 2.1 to LICENSEE:
(a) shall only apply when the specifications for LICENSEE's Products were
created by LICENSEE (either solely or jointly with one or more third
parties);
(b) shall only be under Claims of Licensed Patents, the infringement of
which would be necessitated by compliance with such specifications;
(c) shall not be under Claims for a method or process unless such method
or process is based upon technology created by LICENSEE (either solely
or jointly with one or more third parties) or otherwise licensed by
IBM to LICENSEE; and
(d) shall not apply to any Products in the form manufactured or marketed
by said other manufacturer prior to LICENSEE furnishing said
specifications.
Unless LICENSEE informs IBM to the contrary, LICENSEE shall be deemed
to have authorized said other manufacturer to make LICENSEE's Products
under the license granted to LICENSEE in Section 2.1 when the condition
specified in Section 2.4(a) is fulfilled. In response to a written request
identifying a Product and a manufacturer, LICENSEE shall in a timely manner
inform IBM of the quantity of such Product, if any, manufactured by such
manufacturer pursuant to the license granted in Section 2.1.
2.5 LICENSEE shall have the right to exercise any license rights granted
hereunder through any Subsidiary, and any reference in this Section 2 to
LICENSEE shall be deemed to refer to any Subsidiary through which LICENSEE
shall so exercise such license rights.
Section 3. Payment
3.1 LICENSEE, on behalf of itself and its Subsidiaries, shall pay a
royalty for each Product which contains a Patented Portion at a rate
computed at the following percentages of Selling Price of such Product:
Number of Licensed Patents Percentage of
Covering the Product Selling Price
1 1%
2 2%
3 3%
4 4%
5 or more 5%
For the purposes of this Section 3.1, a Licensed Patent and its
corresponding patents in other countries, listed in Exhibit 1, shall be
deemed to be one Licensed Patent.
Royalties shall only be payable on one occasion for each Product
manufactured and sold by LICENSEE or its Subsidiaries. To the extent a
Product consisting of a semiconductor laser chip, which is subject to
LICENSEE's royalty obligations pursuant to this Section 3.1, is
incorporated as a component, subassembly or subsystem in another product,
the Selling Price shall be determined based on the published list price (or
if no such published list price exists, the fair market value) of such
semiconductor laser chip exclusive of any other portion of the product that
does not contain Patented Portions.
3.2 Subject to Section 3.4, no royalties shall be paid by LICENSEE with
respect to Products which LICENSEE purchases from a third party licensed
under all of the Licensed Patents to sell such Products, and for which
Products a royalty or other consideration was paid to IBM.
3.3 If LICENSEE purchases from a third party portions of a Product and
combines such portions with each other and/or with other portions such that
the combination is itself a Product which includes a Patented Portion not
fully included in any individual purchased portion, then royalty shall be
due for the combination in accordance with this Section 3, whether or not
said third party is authorized by IBM to sell said purchased portions.
3.4 Any semiconductor laser chip that would otherwise be subject to
LICENSEE's royalty obligations pursuant to this Section 3 shall not be
subject to such royalty obligations if such chip is sold by LICENSEE (or
any Subsidiary of LICENSEE authorized to exercise LICENSEE's license rights
hereunder pursuant to Section 2.5 hereof) to a customer that is licensed by
IBM at the time of such sale as to the Patented Portion that would
otherwise give rise to such royalty obligation; provided such customer
notifies LICENSEE, in writing at or prior to the time of such sale, that it
is exercising its own "have made" rights as to such Patented Portion, and
LICENSEE notifies IBM, of its intention to excercise such exclusion from
its royalty obligation in the royalty report for such reporting period.
Section 4. Accruals, Records, Reports and Other Information
4.1 Royalties shall accrue when a Product, with respect to which royalty
payments are required by this Agreement, is first sold or otherwise
transferred (including, sold or otherwise transferred to IBM or any of its
Subsidiaries), or first used in each country of use, by or for LICENSEE or
any of its Subsidiaries.
4.2 LICENSEE's accounting period shall be semiannual and end on the last
day of each June and December during the term of this Agreement. Within
sixty (60) days after the end of each such period, LICENSEE shall furnish
to IBM a written report containing the information specified in Section 4.5
and shall pay to IBM all unpaid royalties accrued hereunder through the end
of each such period.
4.3 LICENSEE shall pay all royalties and other payments due hereunder in
US dollars. All royalties for an accounting period computed in other
currencies shall be converted into US dollars at the exchange rate for bank
transfers from such currency to US dollars as quoted by the head office of
Citibank N.A., New York, USA, at the close of banking on the last day of
such accounting period (or the first business day thereafter if such last
day is a non-business day).
4.4 IBM may accept a late payment provided such payment includes all
overdue royalties or other payment plus interest. The interest on any
overdue royalty or other payment shall be calculated commencing on the date
such royalty or other payment became due, using an annual rate which is the
greater of ten percent (10%) or one percentage point higher than the prime
interest rate as quoted by the head office of Citibank N.A., New York, USA
at the close of banking on such date, or on the first business day
thereafter if such date falls on a non-business day. If such interest rate
exceeds the maximum legal rate in the jurisdiction where a claim therefor
is being asserted, the interest rate shall be reduced to such maximum legal
rate.
4.5 LICENSEE's written report shall be certified by an officer of LICENSEE
and shall contain the following information:
(a)a description of each type of Product, the quantity sold or otherwise
transferred during the accounting period, and the sum of the Selling
Prices for such quantity;
(b)identification of each Licensed Patent covering each such Product.
However, if LICENSEE pays royalties for the use of five (5) or more
Licensed Patents, LICENSEE shall have no obligation to identify the
Licensed Patents for that Product;
(c)the amount of royalties due for each type of Product; and
(d)the aggregate amount of all royalties due.
In the event that any of Sections 4.5(a) through 4.5(d) does not apply to
an accounting period, LICENSEE shall so indicate. In the event no
royalties are due, LICENSEE's report shall so state.
4.6 For the purpose of determining obligations under IBM patents, LICENSEE
shall, within thirty (30) days of a written request by IBM:
(a)provide to or make available for inspection by IBM or its designee any
Product or a copy of any materials relevant to any Product identified
by IBM;
(b)sell, license or otherwise transfer and deliver to IBM any Product at
any time offered for sale or transferred by LICENSEE; and
(c)provide to IBM or its designee access to those manufacturing processes
used by LICENSEE in the manufacture of Products.
4.7 LICENSEE shall keep records in accordance with generally accepted
accounting principles and in sufficient detail to permit the determination
of royalties due to IBM. Such records shall include, but not be limited to,
detailed records supporting the information provided under Section 4.5.
Such records shall be kept for six (6) years following the submission of
the related report.
Upon written notice for an audit, LICENSEE shall permit auditors designated
by IBM, together with such legal and technical support as IBM deems
necessary, to examine, during ordinary business hours, records, materials,
and manufacturing processes of LICENSEE for the purpose of verifying
compliance with this Agreement.
Each party shall pay the costs that it incurs in the course of the audit.
However, in the event that the audit establishes underpayment greater than
five percent (5%) of the royalties due, LICENSEE shall reimburse IBM for
the cost of the audit; provided, however, such reimbursement shall not
exceed the amount of the underpayment.
4.8 IBM agrees that any statements or audit results furnished or otherwise
made available to or obtained by IBM pursuant to this Section 4.0 shall be
subject to equivalent confidentiality restrictions set forth in Section 3
of the Technology License Agreement and shall not be disclosed by IBM for a
period of three (3) years from the date of disclosure.
Section 5. Term; Termination
5.1 The license granted herein shall remain in effect for a period of five
(5) years from the Effective Date, unless earlier terminated under the
provisions of this Agreement.
5.2 LICENSEE may terminate the license granted herein, in whole or as to
any specified Licensed Patent by giving notice in writing to IBM; provided,
however, that termination of the license as to any specified Licensed
Patent shall include termination of the license as to all corresponding
Licensed Patents in other countries. Any such termination shall be
irrevocable.
5.3 IBM shall have the right to terminate this Agreement, or the license
granted hereunder, if LICENSEE is more than fifty-thousand dollars
($50,000) in arrears in its payment obligations or if LICENSEE fails, at
any time to:
(a)maintain records which substantially meets the requirements of Section
4.7;
(b)make a report which substantially meets the requirements of Section 4.5;
or
(c)permit an audit pursuant to Section 4.7; and
if LICENSEE does not cure such breach within sixty (60) days after mailing
of written notice from IBM to LICENSEE specifying the nature of such
breach; unless such breach is the subject of a good faith dispute between
IBM and LICENSEE. IBM's termination of this Agreement or of the license
shall be effective upon written notice.
5.4 No termination of this Agreement or the license granted hereunder
shall relieve LICENSEE of any obligation or liability accrued hereunder
prior to such termination.
Section 6. Option Granted
6.1 LICENSEE grants to IBM, the right to obtain a license to make, use,
import, offer to sell, sell and otherwise transfer any information handling
system product. Said license shall be on terms, including royalty rates,
no less favorable than those granted to LICENSEE herein or in any amendment
hereto. Said right shall bewith respect to any patent under which LICENSEE
or any of its Subsidiaries has the right to grant licenses to unaffiliated
third parties at any time on or before the Effective Date and shall be
limited to a number equivalent to the number of Licensed Patents licensed
hereunder.
Section 7. Means of Payment and Communication
7.1 Payment shall be made by electronic funds transfer. Payments shall be
deemed to be made on the date credited to the following account:
IBM, Director of Licensing
The Bank of New York
48 Wall Street
New York, New York 10286
United States of America
Credit Account No.890-0209-674
ABA No. 0210-0001-8
7.2 Notices and other communications shall be sent by facsimile or by
registered or certified mail to the following address and shall be
effective upon mailing:
For IBM: For LICENSEE:
Director of Licensing Director, Intellectual Property
IBM Corporation Uniphase Corporation
500 Columbus Avenue 163 Baypointe Parkway
Thornwood, New York 10594 San Jose, CA 95134
Facsimile: (914) 742-6737 (408) 954-0540
Section 8. Miscellaneous
8.1 LICENSEE shall not assign this Agreement, assign or sublicense any
rights under it, nor delegate any of its obligations. Any attempt to do so
shall be void.
8.2 Both parties agree not to use or refer to this Agreement or any of its
provisions in any promotional activity.
8.3 IBM shall not have any obligation hereunder to institute any action or
suit against third parties for infringement of any Licensed Patents or to
defend any action or suit brought by a third party which challenges or
concerns the validity of Licensed Patents. LICENSEE shall not have any
right to institute any action or suit against third parties for
infringement of any Licensed Patents.
8.4 IBM represents and warrants that it has the full right and power to
grant the license set forth in Section 2. IBM MAKES NO REPRESENTATIONS OR
WARRANTIES, EXPRESS OR IMPLIED, NOR SHALL IBM HAVE ANY LIABILITY, IN
RESPECT OF ANY INFRINGEMENT OF PATENTS OR OTHER RIGHTS OF THIRD PARTIES DUE
TO LICENSEE'S OPERATION UNDER THE LICENSE HEREIN GRANTED.
8.5 This Agreement shall not be binding upon the parties until it has been
signed hereinbelow by or on behalf of each party. No amendment or
modification hereof shall be valid or binding upon the parties unless made
in writing and signed as aforesaid.
8.6 If any section of this Agreement is found by competent authority to be
invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such section in every other
respect and the remainder of this Agreement shall continue in effect so
long as the Agreement still expresses the intent of the parties. However,
if the intent of the parties cannot be preserved, this Agreement shall be
either renegotiated or terminated.
8.7 This Agreement shall be construed, and the legal relations between the
parties hereto shall be determined, in accordance with the law of the State
of New York, USA, as such law applies to contracts signed and fully
performed in such State.
8.8 The headings of sections are inserted for convenience of reference
only and are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
This Agreement, including its Exhibit, and the Technology License Agreement
of even date herewith, embody the entire understanding of the parties with
respect to the Licensed Patents, and replaces any prior oral or written
communications between them.
Agreed to: Agreed to:
UNIPHASE CORPORATION INTERNATIONAL BUSINESSMACHINES
CORPORATION
By: \s\ Danny E. Pettit By: \s\ Suzanne C. Lewis
Name: Danny E. Pettit Name: Suzanne C. Lewis
Title: Vice President, Finance Title: Business Development
and CFO Consultant
Exhibit 1
"Licensed Patents" shall mean the following patents, patents issuing from
the following applications, and all patents which are reissues, divisions,
continuations, or extensions of any of the following patents:
Patent/Application Issue or File
Number Date
(DD/MM/YY)
4,246,548 20/01/81
4,805,179 14/02/89
4,901,329 13/02/90
4,917,453 17/04/90
4,971,927 20/11/90
5,029,555 09/07/91
5,032,219 16/07/91
5,032,879 16/07/91
5,0377,76 06/08/91
5,059,552 22/10/91
5,060,233 22/10/91
5,100,220 31/03/92
5,103,493 07/04/92
5,111,468 05/05/92
5,153,890 06/10/92
5,172,365 15/12/92
5,177,031 05/01/93
5,185,289 09/02/93
5,247,597 21/09/93
5,259,049 02/11/93
5,280,535 18/01/94
5,284,792 08/02/94
5,287,001 15/02/94
5,307,357 26/04/94
5,309,465 03/05/94
5,311,539 10/05/94
5,319,725 07/06/94
5,327,415 05/07/94
5,331,655 19/07/94
5,344,746 06/09/94
5,373,166 13/12/94
5,376,582 27/12/94
5,376,587 27/12/94
5,414,293 09/05/95
5,463,705 31/10/95
5,498,973 12/03/96
5,516,727 14/05/96
5,594,749 14/01/97
Appl.721072 26/09/96
PCT/IB97/00055 27/01/97
The Agreement for Exchange of Confidential Information
________________________________________________________________________
___
Uniphase Corporation International Business Machines Corporation
163 Baypointe Parkway c/o Research Division
San Jose, CA 95134 Zurich Research Laboratory
CH-8803 Ruschlikon
Uniphase Laser Enterprise AG
c/o Treuhand von Flue AG,
Grienbackstrasse 17
CH-6301 Zug
Uniphase Corporation and Uniphase Laser Enterprise AG collectively
(Uniphase) and International Business Machines Corporation (IBM) agree
that the following terms and conditions apply when one of the parties
(Discloser) discloses Confidential Information (Information) to the
other (Recipient) under this Agreement.
Uniphase and IBM agree that our mutual objective under this Agreement is
to provide appropriate protection for Information while maintaining our
ability to conduct our respective business activities.
Information means any and all information disclosed to, or obtained
through observation on other perception at the jointly occupied facility
located at Ruschlikon, Saumerstrasse 4, by either party pertaining to
the other party (Disclosing Party) which is marked with a restrictive
legend, or which, in the reasonable judgement of an ordinary person,
would appear to be of a proprietary nature and, therefore, in his
judgement, should not be disclosed to a third party without the
Discloser's consent; including business, financial, customer, supplier,
and technical data.
1.DISCLOSURE
The Discloser's and the Recipient's Point of Contact will coordinate and
document as necessary the disclosure. The initial Point of Contact for
Uniphase will be Volkar Graf and for IBM will be Peter Buttner. Either
party may change its Point of Contact by notifying the other party in
writing. Information will be disclosed either:
a) in writing;
b) by delivery of items;
c) by initiation of access to Information, such as may be contained in a
data base; or
d) by oral and/or visual presentation;
e) by accidental observation.
Information should be marked with a restrictive legend of the Discloser.
If Information is not marked with such legend or is disclosed orally or
observed accidentally, 1) the Information will be identified as confidential
at the time of disclosure or within ten (10) working days and 2) the
Discloser will promptly provide the Recipient's Point of Contact with a
written summary including the date disclosed and a brief
non-confidential description of the Information.
2.OBLIGATIONS
The Recipient agrees to use the same care and discretion to avoid
disclosure,
publication or dissemination of the Discloser's Information as it uses
with its own
similar Information that it does not wish to disclose, publish or
disseminate. The
Recipient may use the Discloser's Information for any purpose which does
not violate
such obligation, but will not disclose Information to third parties
without the
permission of the Discloser.
3.CONFIDENTIALITY PERIOD / TERM
Information disclosed pursuant to this Agreement will be subject to the
terms of this Agreement for three years from the date of disclosure. The Term
of this Agreement will begin on March 10, 1997 and will expire upon the
termination or expiration date of the Laboratory Real Estate Lease Agreement
entered into by Uniphase and IBM (the "Lease Agreement") or June 30, 1999
which ever is earlier.
4.EXCEPTIONS TO OBLIGATIONS
The Recipient may disclose, publish, disseminate, and use Information
that is
1) already in its possession without obligation of confidentiality;
2) developed independently;
3) obtained from a source other than the Discloser without obligation of
confidentiality;
4) publicly available when received, or thereafter becomes publicly
available through
no fault of the Recipient; or
5) disclosed by the Discloser to another party without obligation of
confidentiality.
5.RESIDUAL INFORMATION
The Recipient may disclose, publish, disseminate, and use the ideas,
concepts,
know-how and techniques, related to the Recipient's business activities,
which are
contained in the Discloser's Information and retained in the memories of
Recipient's
employees who have had access to the Information pursuant to this
Agreement
(Residual Information).
Nothing contained in this Section gives the Recipient the right to
disclose, publish, or
disseminate, except as set forth elsewhere in this Agreement:
1) the source of Residual Information;
2) any financial, statistical or personnel data of the Discloser; or
3) the business plans of the Discloser.
6.DISCLAIMERS
THE DISCLOSER PROVIDES INFORMATION SOLELY ON AN "AS IS" BASIS.
The Discloser will not be liable for any damages arising out of the use
of Information
disclosed hereunder.
Neither this Agreement nor any disclosure of Information hereunder
grants the
Recipient any right or license under any trademark, copyright or patent
now or
hereafter owned or controlled by the Discloser.
The receipt of Information pursuant to this Agreement will not preclude,
or in any way
limit, the Recipient from:
1) providing to others products or services which may be competitive
with products or
services of the Discloser;
2) providing products or services to others who compete with the
Discloser; or
3) assigning its employees in any way it may choose.
7.GENERAL
This Agreement does not require either party to disclose or to receive
Information.
Neither party may assign, or otherwise transfer, its rights or delegate
its duties or obligations under this Agreement without prior written consent.
Any attempt to do so is void.
This Agreement may only be modified by a written agreement signed by
authorized representatives of both parties.
Neither party may terminate this Agreement unless the Lease Agreement
expires or is terminated. Any provisions of this Agreement which by their
nature extend beyond its termination remain in effect until fulfilled and
apply to both parties' successors and assigns.
Waiver of any breach of this Agreement shall not be a waiver of any
subsequent breach nor shall it be a waiver of the underlying obligations.
The Laws of State of New York, without regard to its principles of conflicts
of lows govern this Agreement.
The parties acknowledge that they have read this Agreement, understand
it, and agree to be bound by its terms and conditions. This Agreement is
the complete and exclusive agreement between the parties regarding
disclosures of Information and replaces any prior oral or written
communications between the parties. Once signed, any reproduction of
this Agreement made by reliable means (for example, photocopy or
facsimile) is considered an original.
Agreed to: Agreed to:
Uniphase Corporation INTERNATIONAL BUSINESS
163 Baypointe Parkway MACHINES CORPORATION
San Jose, CA 95134 Research Division
Zurich Research Laboratory
CH-8803 Ruschlikon
By: \s\Danny E. Pettit By: \s\ Suzanne C. Lewis
Name: Danny E. Pettit Name: Suzanne C. Lewis
Title: Vice President, Title: Business Development Consultant
Finance and CFO
Date: 3/10/97 Date: 3/10/97
Uniphase Laser Enterprise AG, Zug
By: \s\ Danny E. Pettit
Name: Danny E. Pettit
Title: Vice President, Finance and CFO
Date: 3/10/97
