MANUFACTURING TRADEMARK LICENSE AGREEMENT

 

MANUFACTURING TRADEMARK LICENSE AGREEMENT

 

This Manufacturing Trademark License Agreement (“License”) is effective as of the Separation Date (as defined below), between Agilent Technologies, Inc., a Delaware corporation (“Agilent”), and Verigy Ltd., a company organized under the laws of Singapore (“Verigy”).

 

WHEREAS, the Board of Directors of Agilent has determined that it is in the best interest of Agilent and its stockholders to separate Agilent’s existing businesses into two independent businesses;

 

WHEREAS, Agilent and Verigy have entered into a Master Separation and Distribution Agreement, dated as of May 31, 2006 (“MSDA”), which provides among other things, for the separation of certain Verigy assets and Verigy liabilities, the public offering of Verigy stock, the distribution of such stock and the execution and delivery of certain other agreements in order to facilitate and provide for the foregoing; and

 

WHEREAS, the parties further desire that Agilent license the Licensed Marks (as defined below) to Verigy after the separation of the Verigy Business (as defined below);

 

NOW, THEREFORE, in consideration of the mutual promises of the parties, and of good and valuable consideration, it is agreed by and between the parties as follows:

 

ARTICLE I

 

DEFINITIONS

 

For the purpose of this License, unless specifically defined otherwise in this License, all defined terms will have the meanings set forth in the MSDA:

 

1.1   ASTS PRODUCT.  “ASTS Product” means ASTS Device as defined in the IPMA.

 

1.2  AUTHORIZED DEALERS.  “Authorized Dealers” means any distributor, dealer, OEM customer, VAR customer, VAD customer, systems integrator or other agent that on or after the Separation Date is authorized by Verigy or any of its Subsidiaries to market, advertise, sell, lease, rent, service, distribute or otherwise offer a Licensed Product.

 

1.3  BUSINESS.  “Business” shall have the meaning set forth in the GAAA.

 

1.4   COLLATERAL MATERIALS.  “Collateral Materials” means all packaging, tags, labels, instructions, warranties and other materials of any similar type associated with the Licensed Products that are marked with at least one of the Licensed Marks and distributed to the customer in connection with the Licensed Product.

 

1.5   CONTRACT MANUFACTURER.  “Contract Manufacturer” means any third party who manufactures Licensed Products for Verigy or its Subsidiaries under written agreements and sell such Licensed Products only to Verigy or its Subsidiaries.

 

1.6   CORPORATE IDENTITY MATERIALS.  “Corporate Identity Materials” means materials that are not Verigy Products or Verigy Product -related and that Verigy may now or hereafter use to communicate its identity, including, by way of example and without limitation, business cards, letterhead, stationery, paper stock and other supplies, signage on real property, buildings, fleet and uniforms.

 

1.7  DISTRIBUTION DATE.  “Distribution Date” means the Distribution Date as defined in the MSDA.

 

1.8  GAAA.  “GAAA” means the General Assignment and Assumption Agreement between Agilent and Verigy dated June 1, 2006.

 

1.9  IPMA.  “IPMA” means the Intellectual Property Matters Agreement between the Agilent and Verigy dated June 1, 2006.

 

 

1.10  LICENSED MARKS.  “Licensed Marks” means the Agilent Marks listed on Attachment 1 to this License.

 

1.11  LICENSED PRODUCTS.  “Licensed Products” means any Verigy Product on Agilent’s or its Subsidiaries published Customer Price List as of the Separation Date and new versions thereof that have merely minor incremental differences from any such product. Licensed Products shall also include maintenance (whether diagnostic, preventive, remedial, warranty or non-warranty), parts, components, support and similar services associated with Licensed Products, pursuant to maintenance contracts or otherwise.

 

1.12  MAINTENANCE CONTRACTS.  “Maintenance Contracts” means agreements pursuant to which Verigy, its Subsidiaries or their Authorized Dealers or their designees provide repair and maintenance services (whether preventive, diagnostic, remedial, warranty or non-warranty) in connection with ASTS Products, including without limitation agreements entered into by Agilent or its predecessors-in-interest prior to the Separation Date and assigned to Verigy pursuant to the MSDA or Ancillary Agreements (as defined in the MSDA).

 

1.13  MARK.  “Mark” means any trademark, service mark, trade name, domain name, URL or other electronic identifier, and the like or other word, name, symbol or device or any combination thereof, used or intended to be used by a Person to identify and distinguish the products or services of that Person from the products or services of others and to indicate the source of such products or services, including without limitation, all registrations and applications therefore throughout the world and all common law and other rights therein throughout the world.

 

1.14  MARKETING MATERIALS.  “Marketing Materials” means advertising, promotions, display fixtures or any of any similar type literature or things, in any medium, for the marketing, promotion or advertising of the Licensed Products or parts therefor that are marked with at least one of the Licensed Marks

 

1.15  PERSON.  “Person” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.

 

1.16  QUALITY STANDARDS.  “Quality Standards” means written standards of quality applicable to the Licensed Products, as in use immediately prior to the Separation Date, unless otherwise modified in writing by Agilent from time to time during the Term and communicated to Verigy.

 

1.17  SELL.  To “Sell” a product means to sell, transfer, lease or otherwise dispose of a product. “Sale” and “Sold” have the corollary meanings ascribed thereto.

 

1.18  SEPARATION DATE.  “Separation Date” shall have the meaning set forth in the MSDA.

 

1.19  SUBSIDIARY.  “Subsidiary” means Subsidiary as defined in the MSDA.

 

1.20  TERM.  “Term” means the term defined in Article X of this License.

 

1.21  THIRD PARTY.  “Third Party” means a Person other than Agilent and its Subsidiaries or Verigy and its Subsidiaries.

 

1.21  TRADEMARK USAGE GUIDELINES.  “Trademark Usage Guidelines” means the written guidelines for proper usage of the Licensed Marks, as in use immediately prior to the Separation Date and located at: http:/ /www.agilent.com/secure/agilentbrand/

 

User Name: brandid

Password: spark

 

for literature, packaging, exhibit standards, emarketing, learning products, web; and third party Mark use standards located at: http://www.agilent.com/secure/trademark/

 

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User Name: trademark

Password: ez4u

 

And product labeling standards attached hereto as Attachment 2. All such guidelines may be revised and updated in writing at the sites listed above by Agilent from time to time during the Term, or by written communication to the Verigy with regard to the product labeling standards. For avoidance of confusion with regard to product labeling embedded into the manufacturing process, any such labeling that was created by Agilent and on Agilent’s or its Subsidiaries’ Customer Price List as of the Separation Date , will be deemed to be in compliance with any product labeling standards, provided the embedded product labeling has not been altered by Verigy.

 

1.23   VERIGY FIELD.  “Verigy Field” shall have the meaning set forth in the IPMA.

 

1.24   VERIGY PRODUCTS .   “Verigy Products” shall have the meaning set forth in the IPMA.

 

ARTICLE II

 

LICENSES

 

2.1   LICENSE GRANT.  Agilent grants to Verigy a personal, non-exclusive, worldwide and non-transferable (except as set forth in Section 15.10 hereof) license during the Term to use: (a) the Licensed Marks on or in connection with Corporate Identity Materials; and (b) the Licensed Marks on or in connection with the Licensed Products, Collateral Materials and Marketing Materials in connection with the Sale and offer for Sale of such Licensed Products (or in the case of Licensed Products in the form of software, in connection with licensing of such Licensed Products). Agilent grants to Verigy a personal, exclusive, worldwide and non-transferable (except as set forth in Section 15.10 hereof) license during the Term to use the AGILENT INSTAPIN mark on or in connection with the associated Verigy Product, Collateral Materials and Marketing Materials in connection with the Sale and offer for Sale of such associated product (or, in the case of product in the form of software, in connection with licensing of such products).

 

2.2   LICENSE RESTRICTIONS

 

(a)           Once Verigy abandons the use of all of the Licensed Marks on a particular Licensed Product, then Verigy agrees that its license granted hereunder with respect to that Licensed Product shall thereupon terminate

 

(b)           Verigy may not make any use whatsoever, in whole or in part, of the Licensed Marks, or any other Mark owned by Agilent, in connection with Verigy’s corporate, doing business as, or fictitious name, or on Corporate Identity Materials without the prior written consent of Agilent, except as expressly set forth in Section 10.5(a)-(b) below.

 

(c)           Verigy may not use any Licensed Mark in direct association with another Mark such that the two Marks appear to be a single Mark or in any other composite manner with any Marks of Verigy or any Third Party. Notwithstanding the foregoing, this Section 2.2(c) shall not be deemed to prevent use of the INSTAPIN mark, either alone or in connection with another term.

 

(d)           In all respects, Verigy’s usage of the Licensed Marks during the Term pursuant to the license granted hereunder shall be in a manner consistent with the high standards, reputation and prestige of Agilent as represented by its use of the Licensed Marks, and any usage by Verigy that is inconsistent with the foregoing shall be deemed to be outside the scope of the license granted hereunder. As a condition to the license granted hereunder, Verigy shall at all times present, position and promote the Licensed Products marked with one or more of the Licensed Marks in a manner consistent with the high standards and prestige of the Agilent.

 

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2.3   LICENSEE UNDERTAKINGS.  As a condition to the licenses granted hereunder, Verigy undertakes to Agilent that:

 

(a)           Verigy shall not use the Licensed Marks (or any other Mark of Agilent) in any manner contrary to public morals, in any manner which is deceptive or misleading, which ridicules or is derogatory to the Licensed Marks, or which compromises or reflects unfavorably upon the goodwill, good name, reputation or image of Agilent or the Licensed Marks, or which might jeopardize or limit Agilent’s proprietary interest therein.

 

(b)           Verigy shall not use the Licensed Marks in connection with any products other than the Licensed Products, including without limitation any other products sold and/or manufactured by Verigy.

 

(c)           Verigy shall not: (i) misrepresent to any Person the scope of its authority under this License, (ii) incur or authorize any expenses or liabilities chargeable to Agilent, or (iii) take any actions that would impose upon Agilent any obligation or liability to a Third Party other than obligations under this License, or other obligations which Agilent expressly approves in writing for Verigy to incur on its behalf.

 

(d)           All press releases and corporate advertising and promotions that embody the Licensed Marks and messages conveyed thereby shall be consistent with the high standards and prestige represented by the Licensed Marks.

 

2.4  RESERVATION OF RIGHTS.  Except as otherwise expressly provided in this Agreement, Agilent shall retain all rights in and to the Licensed Marks, including without limitation:

 

(a)           All rights of ownership in and to the Licensed Marks;

 

(b)           The right to use (including the right of Agilent’s Subsidiaries and affiliated companies to use) the Licensed Marks, either alone or in combination with other Marks, in connection with the marketing, offer or provision of any product or service, including any product or service which competes with Verigy Products; and

 

(c)           The right to license Third Parties to use the Licensed Marks.

 

(d)           Notwithstanding the foregoing, Agilent retains no right to use or license the marks INSTAPIN or AGILENT INSTAPIN (in its entirety).

 

2.5   THIRD PARTY LICENSES.  Agilent agrees that it and its Subsidiaries and affiliated companies will not license or transfer the Licensed Marks to Third Parties (other than to and among Subsidiaries of Agilent) for use in connection with products or services which compete with Verigy Products that are listed on the CPL (as defined in the IPMA) until eighteen (18) months after the Separation Date. Such restriction shall be binding on any successors and assigns of the Licensed Marks. The foregoing shall not, in any event, limit any of the following: (i) any licenses that may have been granted by Agilent with respect to the Licensed Marks prior to the Separation Date or (ii) licenses granted to Third Parties in connection with any co-branding program (including, by way of example and not by way of limitation, the AGILENT ENABLED program). For purposes of clarification, a product will not necessarily be deemed to compete with another product if it is merely complementary or merely has some functions in common. Each party promptly will respond to requests from the other party regarding whether it considers one product to compete with another product. Except as set forth in this Section 2.5, nothing in this License shall be construed to prevent Agilent from granting any licenses for the use of the Licensed Marks, or from utilizing the Licensed Marks in any manner whatsoever other than as provided in this Section 2.5.

 

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ARTICLE III

 

PERMITTED SUBLICENSES

 

3.1   SUBLICENSES.

 

(a)  SUBLICENSES TO SUBSIDIARIES and CONTRACT MANUFACTURERS .  Subject to the terms and conditions of this License, including all applicable Quality Standards and Trademark Usage Guidelines and other restrictions in this License, Verigy may grant sublicenses to its Subsidiaries and to Contract Manufacturers entering into Contract Manufacturer agreements with Verigy to use the Licensed Marks in accordance with the license grant in Section 2.1 above; provided, that: (a) Verigy enters into a written sublicense agreement with each such Subsidiary sublicensee, and (b) such agreement does not include the right to grant further sublicenses other than, in the case of a sublicensed Subsidiary of Verigy, to another Subsidiary of Verigy. Verigy shall provide copies of such written sublicense agreements to Agilent upon request. If Verigy grants any sublicense rights pursuant to this Section 3.1(a) and any such sublicensed Subsidiary ceases to be a Subsidiary, then the sublicense granted to such Subsidiary pursuant to this Section 3.1(a) shall terminate one hundred and eighty (180) days from the date of such cessation.

 

(b)  SUBLICENSES TO TRANSFEREES .   In addition, if Verigy, within three (3) years after the Separation Date, transfers a going business (but not all or substantially all of its business or assets), and such transfer includes at least one marketable product and tangible assets having a net value of at least ten million U.S. dollars ($10,000,000.00) then, subject to the terms and conditions of this License, including all applicable Quality Standards and Trademark Usage Guidelines and other restrictions in this License, Verigy may grant sublicenses to the transferee of such business to use the Licensed Marks on the Verigy Products that are in the transferred business as of the effective date of the transfer in accordance with the license grant in Section 2.1 above; provided, that: (i) Verigy enters into a written sublicense agreement with the sublicensee, (ii) such agreement does not include the right to grant further sublicenses, and (iii) in any event, such sublicense shall terminate one hundred and eighty (180) days after the effective date of the transfer. Verigy shall provide copies of such written sublicense agreements to Agilent upon request.

 

3.2   AUTHORIZED DEALERS’ USE OF MARKS.  Subject to the terms and conditions of this License, including all applicable Quality Standards and Trademark Usage Guidelines and other restrictions in this License, Verigy (and those Subsidiaries sublicensed to use the Licensed Marks pursuant to Section 2.1) may allow Authorized Dealers, and may allow such Authorized Dealers to allow other Authorized Dealers, to: (a) Sell or otherwise distribute Collateral Materials and Licensed Products bearing the Licensed Marks, and (b) create and use Marketing Materials, provided that such Authorized Dealers execute written agreements with Verigy (or its Subsidiaries) that impose upon such Authorized Dealers an obligation of full compliance with all relevant provisions of this License.

 

3.3  ENFORCEMENT OF AGREEMENTS.  Verigy shall take all reasonably appropriate measures at Verigy’s expense to promptly and diligently enforce the terms of any sublicense agreement or other agreement with any Subsidiary, Contract Manufacturer or Authorized Dealer and shall restrain any such Subsidiary or Authorized Dealer from violating such terms, including without limitation: (a) monitoring the Subsidiaries’ and Authorized Dealers’ compliance with the relevant Trademark Usage Guidelines and Quality Standards and causing any non-complying Subsidiary or Authorized Dealer promptly to remedy any failure; (b) if need be, terminating such agreement; and/or (c) if need be, commencing legal action. In each case, using a standard of care consistent with Agilent’s practices as of the Separation Date, but in no case using a standard of care less than what is reasonable in the industry. In the event that Agilent determines that Verigy has failed promptly and diligently to enforce the terms of any such agreement using such standard of care, Agilent reserves the right to enforce such terms, and Verigy shall reimburse Agilent for its fully allocated direct costs and expenses incurred in enforcing such agreement, plus all out-of-pocket costs and expenses, plus five percent (5%) (or, if such

 

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costs and expenses are incurred more than one year (1) year after the Distribution Date, ten percent (10%)).

 

ARTICLE IV

 

TRADEMARK USAGE GUIDELINES

 

 

4.1   TRADEMARK USAGE GUIDELINES.  Verigy, its Subsidiaries and Authorized Dealers shall use the Licensed Marks during the Term only in a manner that is consistent with the Trademark Usage Guidelines.

 

4.2   TRADEMARK REVIEWS.  At Agilent’s reasonable request, Verigy agrees to furnish or make available for inspection to Agilent samples of all Licensed Products, Collateral Materials and Marketing Materials of Verigy and its Subsidiaries that are marked with one or more of the Licensed Marks. Verigy further agrees to take reasonably appropriate measures to require its Authorized Dealers to furnish or make available for inspection to Verigy samples of all Marketing Materials and Collateral Materials of its Authorized Dealers. If Verigy is notified or reasonably determines that it or any of its Subsidiaries or Authorized Dealers is not complying with any Trademark Usage Guidelines, it shall notify Agilent and the provisions of Article V and Section 3.3 hereof shall apply to such noncompliance.

 

ARTICLE V

 

TRADEMARK USAGE GUIDELINES ENFORCEMENT

 

 

5.1  INITIAL CURE PERIOD.  If Agilent becomes aware that Verigy or any Verigy Subsidiary is not complying with any Trademark Usage Guidelines, Agilent shall notify Verigy in writing, setting forth in reasonable detail a written description of the noncompliance and any requested action for curing such noncompliance. Verigy shall then have thirty (30) days after receipt of such notice (“Guideline Initial Cure Period”) to correct such noncompliance or submit to Agilent a written plan to correct such noncompliance, which written plan is reasonably acceptable to Agilent, unless Agilent previously affirmatively concurs in writing, in its sole discretion, that Verigy or its Subsidiary is in compliance. If Agilent or Verigy becomes aware that an Authorized Dealer is not complying with any Trademark Usage Guidelines, Verigy (but not Agilent) shall promptly notify such Authorized Dealer in writing, setting forth in reasonable detail a written description of the noncompliance and any requested action for curing such noncompliance. Such Authorized Dealer shall then have the Guideline Initial Cure Period to correct such noncompliance or submit to Verigy a written plan to correct such noncompliance, which written plan is reasonably acceptable to Verigy and Agilent.

 

5.2   SECOND CURE PERIOD.  If the noncompliance with the Trademark Usage Guidelines continues beyond the Guideline Initial Cure Period, Verigy and Agilent shall each promptly appoint a representative to negotiate in good faith actions that may be necessary to correct such noncompliance. The parties shall have fifteen (15) days following the expiration of the Guideline Initial Cure Period to agree on corrective actions, and Verigy shall have fifteen (15) days from the date of an agreement of corrective actions to implement such corrective actions and cure or cause the cure of such noncompliance (“Second Guideline Cure Period”).

 

5.3   FINAL CURE PERIOD.  If the noncompliance with the Trademark Usage Guidelines by Verigy or any Subsidiary (as the case may be) remains uncured after the expiration of the Second Guideline Cure Period, then at Agilent’s election, Verigy or the non-complying Subsidiary (as the case may be) promptly shall cease using the non-complying Corporate Identity Materials, Verigy Product, Collateral Materials and/or Marketing Materials until Agilent reasonably determines that Verigy or the non-complying Subsidiary (as the case may be) has demonstrated its ability and commitment to comply with the Trademark Usage Guidelines. If the noncompliance with the Trademark Usage Guidelines by an Authorized Dealer remains uncured after the expiration of the Second Guideline Cure Period, then at Verigy’s election, such Authorized Dealer promptly shall cease using the non-complying Collateral Materials and/or Marketing Materials until Verigy determines that such Authorized Dealer has demonstrated its ability and commitment to comply with the Trademark Usage Guidelines. Nothing in this Article V shall be deemed to limit Verigy’s obligations under Section 3.3 above or to preclude Agilent from exercising any rights or remedies under Section 3.3 above.

 

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ARTICLE VI

 

QUALITY STANDARDS

 

 

6.1   GENERAL.  Verigy acknowledges that the Licensed Products permitted by this License to be marked with one or more of the Licensed Marks must continue to be of sufficiently high quality as to provide protection of the Licensed Marks and the goodwill they symbolize.

 

6.2   QUALITY STANDARDS.  Verigy and its Subsidiaries shall use the Licensed Marks only on and in connection with Licensed Products that meet or exceed in all respects the Quality Standards.

 

6.3   QUALITY CONTROL REVIEWS.  At Agilent’s reasonable request, Verigy agrees to furnish or make available to Agilent for inspection sample Licensed Products marked with one or more of the Licensed Marks. If Verigy is notified or reasonably determines that it or any of its Subsidiaries is not complying with any Quality Standards, it shall notify Agilent and the provisions of Article VII and Section 3.3 shall apply to such noncompliance.

 

ARTICLE VII

 

QUALITY STANDARD ENFORCEMENT

 

7.1  INITIAL CURE PERIOD.  If Agilent becomes aware that Verigy or any Subsidiary is not complying with any Quality Standard, Agilent shall notify Verigy in writing, setting forth in reasonable detail a written description of the noncompliance and any requested action for curing such noncompliance. Following receipt of such notice, Verigy shall make an inquiry promptly and in good faith concerning each instance of noncompliance described in the notice. Verigy shall then have thirty (30) days after receipt of such notice (“Initial Cure Period”) to correct such noncompliance or submit to Agilent a written plan to correct such noncompliance, which written plan is reasonably acceptable to Agilent, unless Agilent previously affirmatively concurs in writing, in its sole discretion, that Verigy or its Subsidiaries is in compliance.

 

7.2   SECOND CURE PERIOD .   If the said noncompliance with the Quality Standards continues beyond the Initial Cure Period, Verigy and Agilent shall each promptly appoint a representative to negotiate in good faith actions that may be necessary to correct such noncompliance. The parties shall have fifteen (15) days following the expiration of the Initial Cure Period to agree on corrective actions, and Verigy shall have fifteen (15) days from the date of an agreement of corrective actions to implement such corrective actions and cure or cause the cure of such noncompliance (“Second Cure Period”).

 

7.3  FINAL CURE PERIOD.  If the said noncompliance with the Quality Standards by Verigy or any Subsidiary (as the case may be) remains uncured after the expiration of the Second Cure Period, then at Agilent’s election, Verigy or the non-complying Subsidiary (as the case may be) promptly shall cease offering the non-complying Licensed Products under the Licensed Marks until Agilent reasonably determines that Verigy, or the non-complying Subsidiary (as the case may be) has reasonably demonstrated its ability and commitment to comply with the Quality Standards. Nothing in this Article VII shall be deemed to limit Verigy’s obligations under Section 3.3 above or to preclude Agilent from exercising any rights or remedies under Section 3.3 above.

 

ARTICLE VIII

 

PROTECTION OF LICENSED MARKS

 

8.1   OWNERSHIP AND RIGHTS.  Verigy agrees not to challenge the ownership or validity of the Licensed Marks. Verigy shall not disparage, dilute or adversely affect the validity of the Licensed Marks. Verigy’s use of the Licensed Marks shall inure exclusively to the benefit of Agilent and Verigy shall not acquire or assert any rights therein. Verigy recognizes the value of the goodwill associated

 

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with the Licensed Marks, and that the Licensed Marks may have acquired secondary meaning in the minds of the public.

 

8.2  PROTECTION OF MARKS.  Verigy shall assist Agilent, at Agilent’s request and expense, in the procurement and maintenance of Agilent’s respective intellectual property rights in the Licensed Marks. Verigy will not grant or attempt to grant a security interest in the Licensed Marks or record any such security interest in the United States Patent and Trademark Office or elsewhere against any Mark application or registration belonging to Agilent. Verigy agrees to, and to cause its Subsidiaries to, execute all documents reasonably requested by Agilent to effect further registration of, maintenance and renewal of the Licensed Marks, recordation of the license relationship between Agilent and Verigy, and recordation of Verigy as a registered user. Agilent makes no warranty or representation that Mark registrations have been or will be applied for, secured or maintained in the Licensed Marks throughout, or anywhere within, the world. Verigy shall cause to appear on all Licensed Products, all Marketing Materials and all Collateral Materials, such legends, markings and notices as may be required by applicable law or reasonably requested by Agilent.

 

8.3   SIMILAR MARKS.  Verigy agrees not to use or register in any country any Mark that infringes on the rights of Agilent in the Licensed Marks, or any element thereof. If any application for registration is, or has been, filed in any country by Verigy which relates to any Mark that infringes the rights of Agilent in the Licensed Marks, Verigy shall immediately abandon any such application or registration or assign it to Agilent. Verigy may not adopt any Marks incorporating the root “Agil” or any other Mark confusingly similar to the Licensed Marks. Verigy shall not challenge Agilent’s ownership of or the validity of the Licensed Marks or any application for registration thereof throughout the world. Verigy shall not use or register in any country or jurisdiction, or permit others to use or register on its behalf in any country or jurisdiction, any copyright, domain name, telephone number, keyword, metatag, other electronic identifier or any other intellectual property right, whether recognized currently or in the future, or any other designation which would affect the ownership or rights of Agilent in and to the Licensed Marks, or otherwise take any action which would adversely affect any of such ownership rights, or assist anyone else in doing so. Verigy shall cause its Subsidiaries and Authorized Dealers to comply with the provisions of this Section 8.3. Notwithstanding the foregoing, Verigy may adopt, use and/or register any Mark containing the term INSTAPIN in connection with any product manufactured or sold by Verigy, provided that such Marks do not otherwise violate any of the provisions of this License.

 

8.4   INFRINGEMENT PROCEEDINGS.  In the event that the Verigy learns, during the Term of this License, of any infringement or threatened infringement of the Licensed Marks, or any unfair competition, passing-off or dilution with respect to the Licensed Marks, Verigy shall immediately notify Agilent or its authorized representative giving particulars thereof, and Verigy shall provide necessary information and assistance to Agilent or its authorized representatives at Agilent’s expense in the event that Agilent decides that proceedings should be commenced. Notwithstanding the foregoing, Verigy is not obligated to monitor or police use of the Licensed Marks by Third Parties other than as specifically set forth in Section 3.3 hereof. Except for those actions initiated by Verigy pursuant to Section 3.3 hereof to enforce any sublicense or other agreement with any Subsidiary or Authorized Dealer, Agilent shall have exclusive control of any litigation, opposition, cancellation or related legal proceedings. The decision whether to bring, maintain or settle any such proceedings shall be at the exclusive option and expense of Agilent, and all recoveries shall belong exclusively to Agilent. Verigy shall not and shall have no right to initiate any litigation, opposition, cancellation or related legal proceedings with respect to the Licensed Marks in its own name (except for those actions initiated by Verigy pursuant to Section 3.3 hereof), but, at Agilent’s request, agrees to cooperate with Agilent at Agilent’s expense to enforce its rights in the Licensed Marks, including to join or be joined as a party in any action taken by Agilent against a third party for infringement or threatened infringement of the Licensed Marks, to the extent such joinder is required under mandatory local law for the prosecution of such an action.

 

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Agilent shall incur no liability to Verigy or any other Person under any legal theory by reason of Agilent’s failure or refusal to prosecute or by Agilent’s refusal to permit Verigy to prosecute, any alleged infringement by Third Parties, nor by reason of any settlement to which Agilent may agree.

 

ARTICLE IX

 

CONFIDENTIALITY

 

9.1   CONFIDENTIAL INFORMATION.  The provisions set forth in Article VI of the IPMA and Article VI of the MSDA are here by expressly incorporated into this agreement and made a part thereof, and all information, whether written or oral, furnished by either party to the other party or any Subsidiary of such other party pursuant to this License shall also be “Confidential Information”, as that term is defined in the IPMA and MSDA).

 

ARTICLE X

 

TERM OF LICENSE

 

10.1         The term of the license granted pursuant to Section 2.1 hereof shall begin on the Separation Date and, unless terminated sooner pursuant to the provisions of Article XII hereof, shall last for the periods set forth in Section 10.6 below.

 

10.2         “Term” as used herein means the foregoing periods of permissible use for the Licensed Marks.

 

10.3         “Non-Customer-Facing Parts” means tangible parts whose branding is not visible to end customers in the ordinary course of use. For the avoidance of doubt, “ordinary course of use” includes normal inspection, use, calibration, maintenance, service, repair and/or failure analysis.

 

10.4         “Agilent Branded Products” means Verigy Products on or in connection with which the Licensed Marks are used, unless such use is solely on Non-Customer-Facing Parts. Marks are in use “on or in connection with” a given product if they are used on the product itself or on Collateral Materials associated with such product.

 

10.5         Verigy agrees to discontinue all use of the Licensed Marks as quickly as is commercially reasonable. Without limiting the foregoing, Verigy shall have the right to use said Marks according to the following conditions and schedule, with which Verigy shall comply strictly:

 

(a)           For the six (6) months following the Separation Date , Verigy may use the Licensed Marks in connection with any Corporate Identity Materials that were in existence or on order prior to the Separation Date.

 

(b)           As of six (6) months following the Separation Date, all use of the Licensed Marks in connection with Corporate Identity Materials must cease.

 

(c)           For the eighteen (18) months following the Separation Date, Verigy may use the Licensed Marks (exclusive of the AGILENT INSTAPIN mark) in Marketing Materials on a royalty free basis;

 

(d)           As of eighteen (18) months from the Separation Date, Verigy must cease all use of Licensed Marks (excluding the AGILENT INSTAPIN mark) in Marketing Materials;

 

(e)           For the thirty-six (36) months following the Separation Date, Verigy may use the AGILENT INSTAPIN mark in Marketing Materials on a royalty free basis;

 

(f)            For the thirty-six (36) months following the Separation Date, Verigy may use the Licensed Marks on or in connection with the Agilent Branded Products on a royalty free basis;

 

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(g)           As of five (5) years following the Separation Date, Verigy must cease all use of Licensed Marks in Agilent Branded Products, and the Mark licensee granted herein shall terminate. Except as would be a violation of law, any Non-Customer-Facing Parts bearing the Licensed Marks manufactured more than five (5) years after the Separation Date shall bear a prominent label indicating that they are manufactured by Verigy and, unless commercially unreasonable, such label shall cover the Licensed Marks on such part.

 

10.6         Verigy agrees to provide written confirmation of compliance with the License Term at six (6), eighteen (18), thirty-six (36) months and at five (5) years. Verigy shall also advise Agilent when it has discontinued use of all remaining Non-Customer-Facing Parts bearing the Licensed Marks.

 

10.7         Except as would be a violation of Law, Verigy agrees to notify all customers receiving parts and materials bearing the Licensed Marks that Verigy is the source of and is the proper contact for such products, parts and materials.

 

10.8         It is understood and agreed that it shall not be a violation of this License for Verigy, its Subsidiaries or Authorized Dealers, at any time after the Term, to make accurate references to the fact that Verigy has succeeded to the business of Agilent with respect to the Licensed Products, or to advertise or promote its or their provision of maintenance services or supply of spare parts for Licensed Products previously sold under any of the Licensed Marks, provided that Verigy, its Subsidiaries and Authorized Dealers do not in connection therewith suggest any affiliation with Agilent, do not claim to be authorized by Agilent in any manner with respect to such activities, and do not brand any products, Marketing Materials, Collateral Materials or parts Sold after the Term with any of the Licensed Marks in a manner that is inconsistent with this Article X.

 

ARTICLE XI

 

ROYALTIES

 

 

11.1   ROYALTIES.

 

(a)           Upon any Sale occurring more than thirty-six (36) months and less than five (5) years after the Separation Date by Verigy or its Subsidiaries of Agilent Branded Products (other than repaired, refurbished or reconstructed Agilent Branded Products), Verigy shall pay to Agilent a five (5)% royalty on the Net Sales earned by Verigy in each Verigy fiscal quarter as a result of such Sale.

 

(b)           As used in this Article XI, “Net Sales” means the gross invoice price from: (i) royalty-bearing Sales under Section 11.1(a) above, in any case less: (1) charges for handling, freight, sales taxes, insurance costs and import duties where such items are included in the invoiced price; (2) point-of-sale credits (or other similar adjustments to price) granted to independent distributors; and (3) credits actually granted or refunds actually given for returns during such Verigy fiscal quarter. In the event that the foregoing Agilent Branded Products are Sold for no or nominal consideration or to a Subsidiary, Authorized Dealer, affiliated company or in any other circumstances in which the selling price is established on other than an arms-length basis, the Net Sales on such Sales shall be determined on the average selling price earned by Verigy during the preceding Verigy fiscal quarter on Sales of like volumes of the applicable Agilent Branded Products to unaffiliated customers in arms-length Sales. However, in the event that the foregoing Agilent Branded Products are Sold to Verigy’s Subsidiaries, Authorized Dealers or affiliated companies for resale to Third Parties, then the royalties will be based on Net Sales from the Subsidiaries, Authorized Dealers or affiliated companies to the Third Parties and no royalties will be due on the Sales to the Subsidiaries, Authorized Dealers or affiliated companies.

 

(c)           For the purposes of clarification, no royalty is due under this Article XI for uses of the Licensed Marks that are covered by Section 10.8.

 

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11.2  PAYMENTS AND ACCOUNTING.

 

(a)           With respect to the royalties set forth herein, Verigy shall keep full, clear and accurate records until otherwise provided in Section 11.2(b). These records shall be retained for a period of three (3) years from the date of payment notwithstanding the expiration or other termination of this License. Agilent shall have the right, through a mutually agreed upon independent certified public accountant (consent to which shall not be unreasonably withheld or delayed by Verigy), and at Agilent’s expense, to examine and audit, not more than once a year, and during normal business hours, all such records and such other records and accounts as may under recognized accounting practices contain information bearing upon the amount of royalty payable to Agilent under this License. Prompt adjustment shall be made by either party to compensate for any errors and/or omissions disclosed by such examination or audit. Should any such error and/or omission result in an underpayment of more than five percent (5%) of the total royalties due for the period under audit, Verigy shall, upon Agilent’s request, pay for the cost of the audit and pay Agilent an additional fee equal to a compound annual interest rate of ten percent (10%) of such error and/or omission.

 

(b)           Beginning thirty-six (36) months after the Separation Date, within forty-five (45) days after the end of each Verigy fiscal quarter, Verigy shall furnish to Agilent a statement in suitable form showing all Agilent Branded Products subject to royalties that were sold, during such quarter, and the amount of royalty payable thereon. If no products or services subject to royalty have been sold, that fact shall be shown on such statement. Also, within such forty-five (45) days, Verigy shall pay to Agilent the royalties payable hereunder for such quarter. Verigy and Agilent will determine the form of the statement prior to submission of the first such statement. All royalty and other payments to Agilent hereunder shall be in United States dollars. Royalties based on sales in other currencies shall be converted to United States dollars according to the official rate of exchange for that currency, as published in the Wall Street Journal on the last day of the calendar month in which the royalty accrued (or, if not published on that day, the last publication day for the Wall Street Journal during that month). If two consecutive Verigy fiscal quarters pass in which no royalties are due under this License and Verigy reasonably believes no royalties will be due, the obligations pursuant to this Article XI shall terminate. If Verigy resumes sale of Agilent Branded Products that are subject to royalties, the obligations of this Article XI shall automatically resume.

 

ARTICLE XII

 

TERMINATION

 

12.1   VOLUNTARY TERMINATION.  By written notice to Agilent, Verigy may voluntarily terminate all or a specified portion of the licenses and rights granted to it hereunder by Agilent. Such notice shall specify the effective date of such termination and shall clearly specify any affected Licensed Marks and Licensed Products.

 

12.2  SURVIVAL.  Any voluntary termination of licenses and rights of Verigy under Section 12.1 hereof shall not affect Verigy’s licenses and rights with respect to any Licensed Products made or furnished prior to such termination.

 

ARTICLE XIII

 

DISPUTE RESOLUTION

 

The provisions of Section 9.3 of the MSDA are hereby incorporated into this License by this reference.

 

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ARTICLE XIV

 

LIMITATION OF LIABILITY

 

IN NO EVENT SHALL EITHER PARTY OR ITS SUBSIDIARIES BE LIABLE TO THE OTHER PARTY OR ITS SUBSIDIARIES FOR ANY DAMAGES NOT EXPRESSLY CONTEMPLATED UNDER THIS AGREEMENT, INCLUDING WITHOUT LIMITATION SPECIAL, CONSEQUENTIAL, INDIRECT, INCIDENTAL OR PUNITIVE DAMAGES OR LOST PROFITS OR ANY OTHER DAMAGES, HOWEVER CAUSED, ON ANY THEORY OF LIABILITY (INCLUDING NEGLIGENCE) ARISING IN ANY WAY OUT OF THIS AGREEMENT, WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

 

ARTICLE XV

 

MISCELLANEOUS PROVISIONS

 

15.1   DISCLAIMER.  EXCEPT AS OTHERWISE SET FORTH HEREIN OR IN THE MSDA OR ANCILLARY AGREEMENTS, EACH PARTY ACKNOWLEDGES AND AGREES THAT ALL LICENSED MARKS AND ANY OTHER INFORMATION OR MATERIALS LICENSED OR FURNISHED HEREUNDER ARE LICENSED OR FURNISHED WITHOUT ANY WARRANTIES WHATSOEVER, WHETHER EXPRESS, IMPLIED OR STATUTORY, WITH RESPECT THERETO INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTIES OF TITLE, ENFORCEABILITY OR NON-INFRINGEMENT. Except as otherwise set forth herein or in the MSDA or Ancillary Agreements, neither Agilent nor any of its Subsidiaries makes any warranty or representation as to the validity of any Mark licensed by it to Verigy or any warranty or representation that any use of any Mark with respect to any product or service will be free from infringement of any rights of any third party.

 

15.2   NO IMPLIED LICENSES.  Nothing contained in this License shall be construed as conferring any rights by implication, estoppel or otherwise, under any intellectual property right, other than the rights expressly granted in this License with respect to the Licensed Marks. Neither party is required hereunder to furnish or disclose to the other any information (including copies of registrations of the Marks), except as specifically provided herein or in the MSDA or Ancillary Agreements.

 

15.3  INFRINGEMENT SUITS.  Neither party shall have any obligation hereunder to institute any action or suit against Third Parties for infringement of any of the Licensed Marks or to defend any action or suit brought by a third party which challenges or concerns the validity of any of the Licensed Marks. Verigy shall not have any right to institute any action or suit against Third Parties for infringement of any of the Licensed Marks. Notwithstanding the forgoing, Verigy may institute a suit based on infringement based on any rights it may have in the INSTAPIN mark.

 

15.4   NO OBLIGATION TO OBTAIN OR MAINTAIN MARKS.  Neither party, nor any of its Subsidiaries, is obligated to: (a) file any application for registration of any Marks, or to secure any rights in any Marks, (b) maintain any Mark registration, or (c) provide any assistance, except for the obligations expressly assumed in this License.

 

15.5  ENTIRE AGREEMENT.  This License, together with the MSDA and Ancillary Agreements constitute the entire understanding between the parties with respect to the subject matter hereof and shall supersede all prior written and oral and all contemporaneous oral agreements and understandings with respect to the subject matter hereof. To the extent there is a conflict between this License and the MSDA or any Ancillary Agreement between the parties, the terms of the MSDA shall govern, provided , however, that the terms of this License shall govern with respect to: (a) Section 3.3 concerning enforcement of agreements, (b) Article V trademark usage guidelines enforcement, (c) Article VII quality standards enforcement, (d) Article IX with respect to Confidential Information

 

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transferred or disclosed pursuant to this License, (e) Article XI concerning royalties and audits due under this license, (f) Article XII with respect to termination of the licenses granted hereunder, (g) Article XIII concerning dispute resolution, (h) Article XIV solely with respect to intellectual property that is licensed by one party to another party pursuant to this License, (i) Section 15.7 concerning jurisdiction, (j) Section 15.9 concerning notice, and (k) Section 15.8 concerning assignment or transfer of rights or obligations arising under this License.

 

15.6   GOVERNING LAW.  The internal laws of the State of California (without reference to its principles of conflicts of law) shall govern the construction, interpretation and other matters arising out of or in connection with this License.

 

15.7   JURISDICTION.  If any dispute arises out of or in connection with the License, the parties hereby irrevocably: (a) consent and submit to the jurisdiction of the federal and state courts located in California; (b) waive any objection to that choice of forum based on venue or to the effect that the forum is not convenient; and (c) waive to the fullest extent permitted by law any right to trial or adjudication by jury.

 

15.8  SECTION HEADINGS; TABLE OF CONTENTS.  The section headings contained in this License are inserted for reference purposes only and are not intended to be a part, nor should they affect the meaning or interpretation, of this License.

 

15.9   NOTICES.  All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered in person, by telecopy with answer back, by express or overnight mail delivered by an internationally recognized air courier (delivery charges prepaid), by registered or certified mail (postage prepaid, return receipt requested) or by e-mail with receipt confirmed by return e-mail to the respective parties as follows:

 

if to Agilent:

 

Agilent Technologies, Inc.

395 Page Mill Road, MS A3-10

P.O. Box 10395

Palo Alto, California 94303-0870

Attn: Vice President, Associate General Counsel and Director of Intellectual Property

Telecopy: (650) 752-5742

 

with a copy to:

 

Simpson Thacher & Bartlett LLP

2550 Hanover Street

Palo Alto, California 94304

Attn: William H. Hinman Jr., Esq.

 

if to Verigy:

 

Verigy Ltd.

395 Page Mill Road

P.O. Box 10395

Palo Alto, California 94306

Attn: General Counsel

Telecopy: (650) 752-5772

 

or to such other address as the party to whom notice is given may have previously furnished to the other in writing in the manner set forth above. Any notice or communication delivered in person shall be deemed effective on delivery. Any notice or communication sent by e-mail, telecopy or by air courier shall be deemed effective on the first Business Day (as defined in the MSDA) following the day

 

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on which such notice or communication was sent. Any notice or communication sent by registered or certified mail shall be deemed effective on the third Business Day following the day on which such notice or communication was mailed.

 

15.10   NONASSIGNABILITY.  Neither party may, directly or indirectly, in whole or in part, whether by operation of law or otherwise, assign or transfer this License, without the other party’s prior written consent, and any attempted assignment, transfer or delegation without such prior written consent shall be voidable at the sole option of such other party. Notwithstanding the foregoing, each party (or its permitted successive assignees or transferees hereunder) may assign or transfer any or all of its rights or obligations under this License to one or more Subsidiaries of such party; provided, however, that no such assignment or transfer shall release the assigning party from any of its liabilities or obligations hereunder. Without limiting the foregoing, this License will be binding upon and inure to the benefit of the parties and their permitted successors and assigns.

 

15.11  SEVERABILITY.  If any provision of this License shall be declared by any court of competent jurisdiction to be illegal, void or unenforceable, all other provisions of this License shall not be affected and shall remain in full force and effect, and Agilent and Verigy shall negotiate in good faith to replace such illegal, void or unenforceable provision with a provision that corresponds as closely as possible to the intentions of the parties as expressed by such illegal, void or unenforceable provision.

 

15.12   AMENDMENT; WAIVER; REMEDIES CUMULATIVE.  This License, including this provision of this License, may be amended, supplemented or otherwise modified only by a written instrument executed by the parties hereto. No waiver by either party of any of the provisions hereof shall be effective unless explicitly set forth in writing and executed by the party so waiving. Except as provided in the preceding sentence, no action taken pursuant to this License, including any investigation by or on behalf of a