Exhibit 10.0
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Exhibit 10.0
as filed with
10-Q
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Confidential
treatment has been requested for portions of this exhibit. The copy
filed herewith omits the information subject to the confidentiality
request. Omissions are designated as [*]. A complete version of
this exhibit has been filed separately with the Securities and
Exchange Commission.
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SEVENTH AMENDMENT TO DEVELOPMENT
AGREEMENT
This SEVENTH AMENDMENT TO THE
DEVELOPMENT AGREEMENT (this “Seventh
Amendment” ) is made and entered into as of April 7,
2006 (the “Seventh Amendment Effective Date” )
by and between DIRECTV, Inc., a California corporation (
“DIRECTV” ), and TiVo Inc., a Delaware
corporation ( “TiVo” ) (collectively, the
“Parties” ).
Recitals
Whereas , the Parties entered into that certain
Development Agreement having an effective date of February 15,
2002 (the “Development Agreement” );
Whereas , the Parties have previously amended the
Development Agreement via that certain First Consolidated Amendment
dated October 31, 2002, that certain Second Amendment dated
December 20, 2002, that certain Third Amendment dated
January 8, 2003, that certain Fourth Amendment dated
April 17, 2003, that certain Fifth Amendment dated
December 19, 2003, and that certain Sixth Amendment dated
April 30, 2004; and
Whereas , the Parties wish to further amend certain
provisions in the Development Agreement.
Now, Therefore
, the Parties agree as
follows:
Agreement
Unless stated otherwise, capitalized
terms used herein shall have the meanings set forth in the
Development Agreement.
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1.
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Definitions. Section 1.15 is hereby deleted and replaced
in its entirety by the following:
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“ 1.15 “TiVo
Software” shall mean the version of software most
recently deployed by DIRECTV for each of the Combination
Receivers.”
In addition, Article I is hereby
amended to add the following provisions:
“ 1.20 “DIRECTV
Covered System” means a [*] for providing [*].
1.21 “IPG” means [*] which allows
[*] information [*]
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[*]
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Certain
information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has
been requested with respect to the omitted portions.
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combined with the [*].
1.22 “PVR”
means a [*] that [*].
1.23 “Satellite
Receiver” means a
[*] that [*].
1.24
“Subsidiary” of an entity (the “Parent
Entity” ) means any entity, the majority voting power of
which is controlled, directly or indirectly, by the Parent
Entity.
1.25 “TiVo Licensed
Technology” means
any technology or intellectual property rights therein licensed by
TiVo or a TiVo Subsidiary to a TiVo distributor or TiVo licensee
for use in a TiVo Covered System pursuant to a bona fide
commercial transaction, which technology or intellectual property
is actually implemented or used in a specific TiVo Covered System
utilized, deployed or otherwise exploited by such TiVo distributor
or TiVo licensee. For clarity, TiVo Licensed Technology does not
include any technology provided or supplied by a TiVo distributor
or TiVo licensee for implementation or use in a TiVo Covered
System.
1.26 “TiVo Covered
System” means [*]
systems related to [*].
1.27 “T & M
Rate” means
[*] until the first anniversary of the Seventh Amendment
Effective Date and, in each subsequent year, [*] rate determined by
multiplying the [*] rate from the preceding year times [*].
”
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2.
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Project
Change Requests. Section 2.3(f) of the Development Agreement
is hereby deleted and replaced in its entirety with the
following:
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“ (f) Project Change
Requests. Each party may initiate a project change request (
“PCR” ) regarding the features of the TiVo
Software by submitting to the other party a detailed description of
the PCR in the form attached as Exhibit I (Project Change
Request Form ). The parties will work together in good faith to
estimate the feasibility, schedule and cost of each PCR, with such
estimate to be completed within 30 days of a party’s
initiation of the PCR. With respect to PCRs initiated by DIRECTV,
each such PCR shall be priced by TiVo at the T & M Rate. The
party initiating the PCR will accept or reject the PCR within 30
days of completion of the estimate. Once provided with schedule and
cost, neither Party is under an obligation to accept the PCR,
provided that TiVo may not reject a PCR initiated by DIRECTV if
DIRECTV agrees to pay for the
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[*]
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Certain
information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has
been requested with respect to the omitted portions.
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2
changes described in the PCR at the
T & M Rate and provides TiVo a commercially reasonable amount
of time to perform the changes described in the PCR, including,
without limitation, all development and testing necessary to
implement such changes. Upon mutual acceptance of the PCR, the
Parties will work together to prepare a finalized development
schedule, product requirement document and associated fee schedule
in order to implement the accepted PCR.”
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3.
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Corrections. Section 2.4 of the Development Agreement is
hereby deleted and replaced in its entirety with the
following:
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“ 2.4 Corrections.
Notwithstanding the foregoing, if at any time during the Term of
this Agreement DIRECTV or TiVo determines (i) that there is a
defect in the design for any of the DIRECTV-TiVo combination
receivers (the “Combination Receivers” ) as
provided by TiVo under this Agreement; or (ii) that a
Combination Receiver design as provided by TiVo or the TiVo
Software as provided by TiVo does not comply with the DIRECTV
Technology, Exhibit A (Development Schedule and
Specifications) , the Interface Specifications (if applicable),
the ATSC specifications (if applicable), or any applicable product
requirement document or specifications attached to any amendment to
this Agreement, each of the foregoing as amended by any mutually
agreed PCR, TiVo has an obligation to promptly correct such defect
or non-compliance in accordance with the provisions set forth in
this Section 2.4 .
(a) DIRECTV shall promptly notify
TiVo of any such defect or non-compliance and shall provide TiVo
with sufficient supporting information and materials reasonably
requested by TiVo to verify, diagnose and correct the reported
defect or non-compliance. In the event of a dispute regarding
whether there is a defect or non-compliance, or failure by TiVo to
promptly perform such correction, DIRECTV and TiVo shall
immediately communicate such dispute to the appropriate
business/project manager when such party becomes aware of the
dispute. If such dispute cannot be mutually resolved by such
business/project managers within five (5) business days, then
such dispute shall be immediately referred to the senior management
of each party for discussion and attempted resolution. Further, the
parties agree to collaborate on a remedy of such defect as promptly
as commercially reasonable, but not more than ten
(10) business days from the time senior management begin
discussions. The foregoing represents DIRECTV’s sole and
exclusive remedy for any defect or non-compliance in the designs or
TiVo Software provided hereunder; provided, that in the event TiVo
materially breaches its obligations to correct such defect or
non-compliance, DIRECTV shall be entitled to exercise any and all
legal and equitable remedies available in accordance with the terms
of this Agreement, including, but not limited to, release of the
deliverables from the Software Escrow Account, as provided pursuant
to Article XI (Network Operation Continuity). For [*]
following the end of the Term of this Agreement, upon
DIRECTV’s request, TiVo agrees to provide the services set
forth in this Section 2.4 at commercially
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[*]
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Certain
information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has
been requested with respect to the omitted portions.
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3
reasonable rates and subject to
reasonable terms and conditions consistent with those set forth
herein.
(b) TiVo shall maintain sufficient
staff and resource availability to fulfill its correction
obligations under this Section 2.4 . In the event of
any defect or non-compliance that prevents operation of the
material functions of any Combination Receiver, TiVo shall promptly
allocate no less than 2 dedicated personnel with appropriate
experience and expertise to diagnose and correct such defect or
non-compliance, until such time as the correction is completed. In
each instance, TiVo shall cooperate with DIRECTV and provide
sufficient resources to permit the completion of any necessary TiVo
Software download to all affected Combination Receivers within a
timeframe of no less than nine (9) weeks from the start of
such download, provided that such timeframe will be increased for
any delays not attributable to TiVo.”
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4.
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Reno, Provo
and Two-Chip Receiver Fees. A new Section 3.4(d) is hereby added to the
Development Agreement, to read as follows:
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“ (d) Notwithstanding
anything in this Section 3.4 to the contrary,
commencing on the Seventh Amendment Effective Date and continuing
through the expiration or termination of this Agreement, DIRECTV
shall pay to TiVo monthly DVR/PVR Service Fees of not less than
[*] per month. For purposes of clarification, if the
actual calculation of DVR/PVR Service Fee payments pursuant to this
Article III declines below [*] at any time during the Term,
DIRECTV will continue to make DVR/PVR Service Fee payments of [*]
per month (but not beyond the expiration or termination of this
Agreement). Upon the mutual agreement of the parties, DIRECTV may
advance some or all of the DVR/PVR Service Fees for any particular
month to TiVo. Any such advance will reduce the minimum required
monthly DVR/PVR Service Fees in that particular month by the amount
of the advance ( i.e. , the minimum DVR/PVR Service fee for
a particular month would be [*] minus the amount of such DVR/PVR
Service Fees paid to TiVo in advance).”
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5.
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Development
Credits. A new
Section 3.14 is hereby added to the Development Agreement, to
read as follows:
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“ 3.14 Development
Credits. On an annual basis commencing on February 1,
2007, DIRECTV shall be entitled to a non-refundable
“Development Credit” [*] made to TiVo during the
prior 12 months; provided, however, that the Development Credit in
any particular year will be calculated without regard to whether
DVR/PVR Service Fees have been advanced to TiVo pursuant to
Section 3.4(d) . The Development Credits shall be
applied against amounts payable by DIRECTV to TiVo for development
services undertaken pursuant to an accepted PCR as set forth in
Section 2.3(f) , provided, however, any Development
Credits to which DIRECTV is entitled as of February 1 of a
given year must be used by no later than January 31 of the
subsequent year. Development Credits
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[*]
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Certain
information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has
been requested with respect to the omitted portions.
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4
not used by January 31 of the
subsequent year shall be forfeited. DIRECTV may elect to use
Development Credits to which DIRECTV expects to be entitled as of
February 1 of a given year, up to a maximum of [*] or
such greater amount agreed by TiVo, toward amounts payable by
DIRECTV to TiVo for development services undertaken pursuant to an
accepted PCR ( e.g. , if amounts are payable prior to
February 1 of a given year