Licensed Works Agreement Statement of Work

 

This Statement of Work ("SOW") # 4908004020 adopts and incorporates by reference the terms and conditions of Licensed Works Agreement # 4908004013 (“Base Agreement”) between International Business Machines Corporation (“Buyer”) and Avistar Communications Corporation (“Supplier”).   Unless otherwise defined herein below, all terms shall have the definitions ascribed to them in the Base Agreement.  This SOW is effective beginning on the last date of execution by both parties, and will remain in effect without cancellation for an initial five (5) year term unless earlier terminated for Cause in accordance with Section 14.1 of the Base Agreement; thereafter, this SOW  will remain in effect until terminated in accordance with Section 14.0 of the Base Agreement (“Term”).  Transactions performed under this SOW will be conducted in accordance with and be subject to the terms and conditions of this SOW, the Base Agreement, and any applicable Work Authorizations (“WAs”).  This SOW is not a WA.

Buyer licenses from Supplier components of a bandwidth management computer software program known as Avistar C3 v10.5 (“Avistar Bandwidth Management”) and subsequent updates, Error Corrections and Enhancements as described in Section 3.0 of this SOW. Supplier will also provide to Buyer the Services and Deliverables described in Section 5.0 of this SOW.

“Cluster” means a group of coupled computers that work together closely so that in many respects they can be viewed as though they are a single computer. The components of a Cluster are commonly, but not always, connected to each other through fast local area networks. Clusters are usually deployed to improve performance and/or availability over that provided by a single computer, while typically being much more cost-effective than single computers of comparable speed or availability.

"Deliverables" means items that Supplier prepares for or provides to Buyer as described in a SOW and/or WA. Deliverables include Developed Works, Licensed Works, Preexisting Materials, and Tools.

"Developed Works" means all work product (including software and its Externals), developed in the performance of this Agreement as described in this SOW and/or a WA. Developed Works do not include Licensed Works, Preexisting Materials, Tools, or items specifically excluded in this SOW and/or a WA.

“Fail-over” means the capability to switch over automatically to a redundant or standby computer server, system, or network upon the failure or abnormal termination of the previously active server, system, or network. Fail-over happens without human intervention and generally without warning, unlike switchover.

“Node” means a single computing device, such as a hardware server.

“Pre-Existing Materials”                                                        means items including their Externals, contained within a Deliverable, in which the copyrights are owned by a third party or that Supplier prepared or had prepared outside the scope of this Agreement.  Preexisting Materials exclude Tools, but may include material that is created by the use of Tools.

“Representational State Transfer” (“REST”) means an architectural style to code Application Programming Interfaces (“API”) using HTTP. This style is described in Roy Fielding’s dissertation, “ Architectural Styles and the Design of Network-based Software Architectures ”.

“Resource Reservation Protocol” (“RSVP”) means a transport layer   protocol designed to reserve resources across a network for an integrated services   Internet .

“Session Initiation Protocol” (“SIP”) means a signalling protocol, widely used for setting up and tearing down multimedia communication sessions such as voice and video calls over the Internet.

“Software Subscription or Metered Use Offering” means an offering to customers or other users, whether or not branded by Buyer or its Affiliates, for which end user customers pay a fee for access to software functionality for a fixed period of time, or for a fixed quantity of Web-based services.

 

 

 “ Subsidiary ” or “ Subsidiaries ” 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.

“Multipoint Control Unit” (“MCU”) means an endpoint on the local area network that provides the capability for three (3) or more terminals and gateways to participate in a multipoint conference.

“Virtual Private Network” (“VPN”) means a computer network in which some of the links between nodes are carried by open connections or virtual circuits in some larger network (e.g., the Internet ) instead of by physical wires.

3.1.1  General Description of Licensed Work:

·	Bandwidth management API (phase 1)

3.1.2  Specific Description of Licensed Work:

·	Bandwidth management API (phase 1)

 

 

Buyer-created components.  It is understood that in different system deployments the installation process may involve multiple installation processes or need to be invoked multiple times on different servers.

3)	Supplier will provide all relevant information and documentation for the installation, deployment and configuration of the elements of the Licensed Works to achieve the requirements set forth in this document.

5)	Supplier’s name, product names or logos, will not appear in the installation databases after the Licensed Works are installed.

Tools for the Licensed Work are identified below. Supplier will update this list for all changes as soon as practicable after the change is identified.

 

 

Supplier will provide Buyer, at no charge, Basic Enhancements and Error Corrections to the Licensed Work for *** .

Supplier will provide Buyer, *** Major Enhancements to the Licensed Work *** .

The Licensed Work must be able to be incorporated into the Product.  All features of the Licensed Work must be able to be exercised without requiring use of tools or user-interfaces other than those delivered by Supplier to Buyer for inclusion in the Product, or those provided in the Licensed Work and explicitly selected by Buyer.

Buyer will generate branding and product identification materials for the Product.  The Licensed Work will not express any user interface or other end-user viewable information that includes the Supplier’s branding or identity, except as mutually agreed in writing by the parties.

Any and all management and monitoring interfaces, including both programmatic, command-line interfaces, and management user-interfaces which are included or used in the Licensed Work will be documented by Supplier and available by Supplier to Buyer for use in the Product. This documentation will be delivered in English.

The Licensed Work must support compatibility with the Buyer-supplied proxy/registrar using the SIP, as follows:

The Licensed Work must support compatibility with the Buyer-supplied client endpoint as follows:

The Licensed Work must support coexistence with Buyer-created components on the same server machine.  The Licensed Work must provide that all communication ports and IP addresses are configurable at time of deployment to avoid conflict.

 

 

The Licensed Work must support a sufficient level of error reporting and problem determination as follows:

4.0         Rights in Licensed Works

Supplier grants Buyer and Buyer Personnel a nonexclusive, worldwide, perpetual, irrevocable license to use, have used, execute, reproduce, transmit, display, perform, to prepare and have prepared derivative works of Licensed Works, to transfer, distribute, and sublicense Licensed Works and such derivative works in Object Code form only, and documentation, in any medium or distribution technology, and to grant others the rights granted herein.

(a)	Covenant Not to Sue from Buyer to Supplier

 

 

Supplier grants Buyer and Buyer Personnel a nonexclusive, worldwide, perpetual, irrevocable, paid-up license to prepare and have prepared derivative works of the Externals, and to use, have used, execute, reproduce, transmit, display, perform, transfer, distribute, and sublicense the Externals and such derivative works, in any medium or distribution technology, and to grant others the rights granted herein.

5.1	See the Attachment entitled, “ Sales Enablement Plan ”, for the Services and Deliverables related to sales enablement that Supplier will provide to Buyer. These Services and Deliverables will be considered complete upon Buyer’s acceptance.

6.1	In addition to delivering Licensed Works, Tools and other Deliverables and Services on schedule, Supplier will:

ii.	an invoice description that provides enough detail to verify the categorical classification of every Product.

Supplier may subcontract Services to be performed hereunder. Notwithstanding this subsection, Supplier's use of subcontractors will not relieve Supplier of the responsibility for the subcontractor's performance, and Supplier's obligations and responsibilities assumed under this SOW will be made equally applicable to subcontractors. Buyer reserves the right to reject Supplier's use of a subcontractor in performance of this SOW for any reason .

For each Licensed Work, Supplier agrees to place in escrow in accordance with the terms and conditions of a separate Source Code Custodial Agreement ("SCCA"), the following materials: (i) two (2) copies of the Licensed Work in machine-readable format, including both Source Code and Object Code; (ii) one (1) complete set of the Documentation related to the Licensed Work in both hard copy and machine-readable form; (iii) one (1) copy of a comprehensive list of all items in the development environment indicating those items which are commercially available on reasonable terms through readily known sources; (iv) one (1) set of the development environment except those items identified pursuant to 3 above as being commercially

 

 

available on reasonable terms through readily known sources; (v) one (1) copy of a comprehensive list of all Source Code modules of the Licensed Work.

Supplier will notify Buyer *** of the occurrence of a Triggering Event as defined in the relevant SCCA. Buyer is granted a nonexclusive, worldwide, perpetual, irrevocable license to prepare and have prepared derivative works of Escrowed Materials, and to use, have used, execute, reproduce, transmit, display, perform, transfer, distribute and sublicense Escrowed Materials and such derivative works, in any medium or distribution technology for the purposes of maintaining and providing Basic Enhancements to the Licensed Work.

Buyer and Supplier will treat the release of the Escrowed Materials as a disclosure of Confidential Information under the parties’ existing Confidential Disclosure Agreement related to the Licensed Work, or if none, under Buyer’s then standard Confidential Disclosure Agreement.

In the event that assets are loaned to Supplier and there is no separate loan agreement in place between Buyer and Supplier for those assets, Supplier will be responsible for risk of loss and for the return of those assets to Buyer.

(a)

Supplier will use all commercially reasonable efforts to disclose to IBM in writing the existence of Third Party Code that is included in or is provided in connection with the Deliverables.  Supplier represents and warrants on an ongoing basis that, before entering into this SOW, Supplier has disclosed to Buyer in writing the existence of any third party code, including without limitation open source code and freeware, ("Third Party Code") that is included in or is provided in connection with the Deliverables and that Supplier and the Deliverables are in compliance with all licensing agreements applicable to such Third Party Code.

 

 

Upon Buyer request, Supplier will provide a Dun and Bradstreet report or similar report at Supplier's expense to Buyer. Submission of the Dun and Bradstreet report must be initiated through the IBM Global Procurement Supply Portal and routed directly from Dun and Bradstreet to Buyer. Supplier will be responsible for the full cost of the report at the price established by Dun and Bradstreet, and no rebate, refund or other discount which may be applicable to Buyer or its Affiliates will apply to the price of the report purchased by Supplier.

In order to facilitate Buyer’s validation of requirements and completion of the Product, Supplier agrees to make available to Buyer mutually agreed testing lab facilities.  These facilities will include access to audio/video equipment and configured instances of the Licensed Work elements.  These facilities will be employed both to verify features of the Licensed Work, and to test integrated features of the Product.  The location of the lab resources, and the timing of their use, will be determined and documented by the joint technical team.

Additionally, Supplier agrees to provide reasonable support to Buyer in the form of documentation, information and guidance on best-practices in Buyer’s establishment of lab deployments intended for use with the Product in Buyer’s facilities.

The Deliverables will be subject to a process whereby compliance with the technical requirements set forth is verified for purposes of determining Final Acceptance of the Deliverables.  Buyer and Supplier agree that this process shall consist of preliminary testing, to be followed by an iterative process requiring coordination of the development schedules of the parties.  After the preliminary testing is completed, Supplier agrees to correct errors and conduct subsequent testing, as agreed upon through the joint technical process.  This process will continue until the Deliverable meets the Final Acceptance criteria.

Supplier will perform the following tests upon the Deliverable:

2.	functional verification testing

4.	performance and scalability testing

Upon Buyer's reasonable request, specific tests in each of the foregoing areas will be performed by Supplier.

During the iterative development process, prior to each code delivery, Supplier will perform a set of tests to ensure a minimum level of stability before delivering to Buyer.  Supplier will provide to Buyer, concurrent with each iterative delivery of a Deliverable, all test reports associated with that delivery of the Deliverable.

Preliminary testing during the development process shall be performed by Supplier and based upon the operation of the Deliverable and a set of Product operations mutually agreed by the parties.  The criteria for the preliminary testing shall consist of the following:

***

After successful completion of the preliminary tests, the Deliverables will be subject to further rounds of acceptance testing (“ Iterative Acceptance Testing ”) to be conducted by both parties. Each party shall provide necessary technical personnel and resources at the site(s) where Iterative Acceptance Testing is performed.  The Iterative Acceptance Testing will be performed against both the Product and the Deliverables.  The timing for these tests will be based on ongoing deliveries of the Deliverables and shall be performed promptly after such deliveries on mutually agreed dates.  Supplier agrees to resolve

 

 

all errors found during Iterative Acceptance Testing prior to Final Acceptance (see Section 7.5 below).  In cases where the need or timing of an Error Correction is uncertain, the joint technical team will determine the proper resolution, and can mutually agree whether to correct or defer correction for any given error.

Supplier shall deliver the Deliverable that materially complies with the specifications stated herein for final acceptance.    Final Acceptance will occur when the Deliverables delivered by Supplier materially meet all functional requirements, non-functional requirements and integration requirements set forth and when all errors (other than Severity Level 4 errors) identified by Buyer as requiring correction in Iterative Acceptance Testing have been verified as corrected  (“ Final Acceptance ”).

Buyer shall have *** after receipt of Deliverable to complete Final Acceptance tests. Upon achievement of satisfactory test results in accordance with the criteria defined in this SOW, Buyer shall notify Supplier of its Final Acceptance of the Deliverable in writing *** after test completion. Buyer shall also notify Supplier of any error *** after test completion. Buyer may reject the Deliverable if it does not comply with the Final Acceptance criteria set forth in this section.   A failure by Buyer to provide written acceptance or rejection within the timeframes specified above shall be deemed Final Acceptance.

Should Buyer reject the Deliverable submitted for Final Acceptance due to non-conformance with the test criteria specified in this document, Supplier shall use all reasonable endeavors to promptly remedy such deficiencies and shall again deliver the Deliverable for Final Acceptance testing. The parties shall then repeat the Final Acceptance test procedure set forth above until the Deliverable has achieved Final Acceptance.

The following list of events will be included in the project plan.

Design Complete : All technical issues regarding the use of the Deliverables, including deployment models, integration models, required interface or functional changes or enhancements to the Deliverables, etc. have been specified and agreed to through the joint technical process.

Delivery Schedule Complete: A schedule for both interim deliveries of the Deliverables, and Iterative Acceptance Testing activities is agreed to through the joint technical process.

Final Delivery : Receipt of the expected final version of the Deliverables, which is intended to meet all Final Acceptance criteria.

Final Acceptance Complete : Successful validation of all Final Acceptance criteria.

Buyer may, at its sole discretion, waive requirements for its acceptance testing of the Deliverables. Any such waiver must be in writing and signed by Buyer. Buyer's testing does not relieve Supplier of its obligations under this Agreement.

2)	assessment of engineering, development and test processes;

4)	assessment of the quality of Deliverables, Products and Services;

6)	processes to correct errors or other non-conformances. Supplier will periodically, as negotiated, provide Buyer its standard product development life cycle and error metrics. An example of the data of interest is included in the Attachment entitled “ Sample Data Collection Form for Supplier ”.

Supplier also represents that it qualifies or will qualify during the Term of this Agreement as a Software Engineering Institute's (SEI) Capability Maturity Model Integration - Software Engineering (CMMI-SW) Level  2 development organization.

 

 

8.2     The parties agree that the Attachment entitled " Quality Requirements for Customized or Developed Works " is hereby incorporated by reference into this Agreement.

9.1	Upon mutual agreement, within *** , the parties will conclude a project plan, which will include engagement guidelines for the parties’ technical teams and assistance Buyer may provide to Supplier under this Agreement.

The relevant milestones, completion dates, and terms associated with this SOW are:

 

 

In partial consideration for the licenses granted by Supplier in the Patent License Agreement referenced in Section 4.2(b) of this SOW, Buyer will pay Supplier a one time fixed payment of three million dollars (USD $3,000,000.00). Such payment will be made net sixty (60) days after the Effective Date of this SOW.

In consideration for the *** of license fees and Software Subscription or Metered Use Offering fees received by Buyer for the Product(s) beginning in the calendar quarter in which a Product becomes generally available, Buyer will pay Supplier the following pre-paid, non-refundable royalties as a bulk purchase for Licensed Works and the patent license granted in the Patent License Agreement referenced in Section 4.2(b) above  upon Final Acceptance of Deliverables as set forth below:

Date/Event:                                                                                                                                          Payment:

 Within *** following Final Acceptance of phase 1 Deliverables                                                                                                                                          USD $1,500,000.00 

 Within *** following Final Acceptance of phase 2 Deliverables                                                                                                                                          USD $1,500,000.00      

Beginning in the first calendar quarter in which net revenue recorded by Buyer for the Product(s) *** Buyer will pay Supplier an additional royalty as follows (“Additional Royalties”) for Licensed Works and the licenses granted in the Patent License Agreement referenced in Section 4.2(b) above :

(a)  When a Product is licensed to end user customers, Buyer will pay Supplier an Additional Royalty equal to two percent (2%) of net revenue recorded by Buyer for each authorized copy of the Product licensed to an end user customer by Buyer or Buyer Personnel;

(b)  When a Product is combined with other products or services and offered to end user customers (“Product Bundle”), Buyer will pay Supplier an Additional Royalty equal to two percent (2%) of the net revenue recorded by Buyer for each authorized copy of the Product Bundle licensed to an end user customer by Buyer or Buyer Personnel, which license fee will be based on the proportionate value of the Product to the Product Bundle as determined by Buyer in its commercially reasonable discretion;

(c)  When a Product is offered to end user customers as part of a   Software Subscription or Metered Use Offering, Buyer will pay Supplier an Additional Royalty equal to two percent (2%) of the net revenue recorded by Buyer for each such Software Subscription or Metered Use Offering sold to an end user customer by Buyer or Buyer Personnel, which license fee will be based on the proportionate value of the Product to the Software Subscription or Metered Use Offering as determined by Buyer in its commercially reasonable discretion;

(d)  Buyer shall not owe any Additional Royalties to Supplier for internal use of any Product by Buyer or Buyer’s Affiliates and any such use of the Product(s) will not be included in any calculation of *** Additional Royalty trigger amount.

Buyer may request a lower Additional Royalty for the Products when a licensing transaction requires a substantial discount. If Supplier agrees, both parties will sign a letter specifying the licensing transaction and its lower Additional Royalty payment.

Buyer will pay supplier Additional Royalties based upon net revenue recorded by Buyer in a *** for the Product(s). Payment will be made in US dollars, *** during which net revenue is recorded and recognized by Buyer for a Product and/or Service sale, unless the last day of the month falls on a weekend or holiday, it will then be made on the next business day. In the US, a royalty payment quarter ends on the last day *** . Outside of the US, a royalty payment *** is defined according to Buyer’s current administrative practices. Royalties will be paid less adjustments and refunds due to Buyer. Buyer will provide a statement summarizing the royalty calculations with each payment.

 

 

All communications between the parties will be carried out through the following designated coordinators. All notices required in writing under this Agreement will be made to the appropriate contact listed below at the following addresses and will be effective upon actual receipt. Notices may be transmitted electronically, by registered or certified mail, or courier. All notices, with the exception of legal notices, may also be provided by facsimile.

Business Coordinators

Legal Coordinators

Technical Coordinators

Unless previously submitted by Supplier, in order to initiate electronic transfer of payments associated with this SOW, Supplier will complete the attached form entitled “ Authorization for Electronic Funds Transfer ” and fax the completed form to Accounts Payable at the number included on the form.

Supplier shall disclose to Buyer the extent to which Deliverables are accessible to persons with disabilities, either directly or through assistive technology. Supplier will complete and deliver to Buyer either the applicable IBM Accessibility checklist (preferred), Web Content Accessibility Guidelines (WCAG) checklist or Information Technology Industry Council US Section 508 Voluntary Product Accessibility Template, *** of the effective date of this Agreement. Supplier shall update the accessi