First Addendum to Limited TCC License Agreement
EXHIBIT 10.15
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.
TESSERA CONFIDENTIAL
First Addendum to
Limited TCC License Agreement
This First Addendum is entered into as of this 4th day of November, 1998 (First Addendum Effective Date) between TESSERA INC., a corporation organized under the laws of Delaware (Tessera) and SAMSUNG ELECTRONICS CO., LTD., a corporation organized under the laws of Republic of Korea having a principal place of business at 250 Taepyung-Ro, 2 Ga, Chung-Ku, Seoul, Korea (Licensee) and modifies the Limited TCC License Agreement entered into by and between the parties having an Effective Date of May 17, 1997 (Agreement), with reference to the following facts:
I. Supplement to the Agreement. This First Addendum merely supplements certain provisions of the Agreement. All provisions contained within the Agreement are therefore incorporated herein. In the event any of the provisions of the Agreement and this First Addendum conflict, the provisions contained in this First Addendum shall supersede the conflicting provisions.
II. Royalties
A. Royalty Adjustments. In making the royalty payments due Tessera, Licensee may subtract from such royalty payments any preceding royalty payments for defective royalty bearing TCC packages that are returned to Licensee from Licensees customers (Royalty Adjustment). However, if at any time such defective TCC packages are resold by Licensee, Licensee shall pay a royalty to Tessera for such resold TCC packages, as set forth in the Agreement and this First Addendum. Before a Royalty Adjustment can be so subtracted, Licensee must have originally paid a royalty on the particular returned TCC package. All Royalty Adjustments must be specified with the information set forth in Addendum Attachment A.
III. Licensee Reports and Payment
A. Quarterly Royalty Payments. Beginning with the first royalty payment due Tessera from Licensee after the First Addendum Effective Date, royalties shall be calculated and paid in full in quarter annual payment periods ending March 31, June 30, September 30 and December 31 of each year. Beginning with the first such royalty payment, Licensee shall deliver a written report (as shown in Addendum Attachment A) within twenty (20) days from the last day of each quarter annual payment period describing the basis upon and containing the information sufficient to determine the royalties due Tessera for the applicable payment period (by facsimile, with an original by mail courier). Tessera shall then invoice Licensee (by facsimile, with an original by mail courier) for the royalties due Tessera as set forth in each such Licensee written royalty report. Licensee shall then have thirty (30) days from first receipt of Tesseras invoice to pay the royalties due under Tesseras invoice. All payments under this Paragraph shall be made in US Dollars by wire transfer to Union Bank of California, 99 Almaden Blvd., San Jose, CA 95113, Account Name: Tessera, Account No.: 6450148359, Routing No. 122000496, International Swift Code: UBLAUS66, or such other bank or account as Tessera may from time to time designate in writing. The payments of royalties shall be considered to be made as of the day on which such payments are received in Tesseras designated bank account.
IV. Joint Marketing
A. Monetary Commitment. Within thirty (30) days of Licensees prepayment of the [*] US dollar (US$[*]) royalty buy-down payment applicable to the Volume Adjustment in Paragraph III.C of the Agreement, Tessera shall pay Licensee [*] US dollars (US$[*]) to be used by Licensee exclusively for the joint marketing of
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Licensees ICs packaged in a royalty bearing TCC package format, as further set forth in this Paragraph IV. Tessera shall also spend [*] US dollars (US$[*]) towards such joint marketing effort.
B. Marketing Efforts. Only those marketing efforts that are executed to the strategic marketing plan set forth in this Paragraph IV.D will be counted towards satisfying each partys monetary obligation to market Licensees ICs packaged in a royalty bearing TCC package format, as set forth in Paragraph IV.A. The joint marketing effort may include: (1) press conferences, in Asia, Europe and the United States; (2) user group conferences to teach the benefits of TCC packages for Samsung ICs; (3) advertising in major IC and packaging magazines in Asia, Europe and the United States specifically listing both Tessera and Licensee in each advertisement; or (4) direct customer marketing to end-user customers, commonly known as OEMs, e.g. for personal computer DRAM applications such customers would be Intel, Dell, Compaq, Acer and other printed circuit board/computer OEM manufacturers.
C. Expenses. In addition to the expenses required for the marketing efforts set forth in Paragraph IV.B above, travel expenses for airline flights, hotel rooms and food costs are expensable against each partys monetary obligation to market Licensees ICs packaged in a royalty bearing TCC package format (as set forth in Paragraph IV.A.) so long as each such expense is verified by a third party receipt. International airline flights may be business class for employees at a director level and above, but must be coach class for employees under a director level, e.g. engineers, administrative assistants, etc. Airline flights for domestic travel within any country must be coach class for all travelers.
D. Timeline. Tessera and Licensee agree to meet (at a mutually agreed upon location) and develop a strategic marketing plan for executing the intent of this Paragraph IV within forty-five (45) days of execution of this First Addendum. Tessera and Licensee further agree that the joint marketing obligations under this Paragraph IV will be completely satisfied within one (1) year of the First Addendum Effective Date or an alternate time line to be agreed upon by the parties in a writing signed and dated by both parties.
V. Entire Understanding. This First Addendum embodies the entire understanding between the parties relating to the subject matter hereof, whether written or oral, and there are no prior representations, warranties or agreements (except those specifically set forth in the Agreement) between the parties not contained in this First Addendum. Any amendment or modification of any provision of this First Addendum must be in writing, dated and signed by both parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the date first above written.
For TESSERA, INC. | For SAMSUNG ELECTRONICS CO., LTD. | |||||||
By: | /s/ JOHN W. SMITH | By: | /s/ HYUNG KYU LIM | |||||
Name: John W. Smith | Name: Hyung Kyu Lim | |||||||
Title: President & CEO | Title: Sr. Vice President | |||||||
Date: 11-4-98 | Date: 11-9-98 |
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TESSERA CONFIDENTIAL
ADDENDUM ATTACHMENT A
ROYALTY REPORT UNDER TESSERA TCC LICENSE AGREEMENT
Quarterly Reporting Period: From through
Part Type | Number of TCC | Number of | Royalty Rate | Royalty Due (US$) | ||||
ROYALTY ADJUSTMENTS
Customer | Date of Royalty | Number of Returned | Number of Billable Pins | Royalty Rate | Royalty Adjustment (US$) | |||||
TOTAL ROYALTY: | US$ | |
LESS TOTAL ROYALTY ADJUSTMENT: | US$ | |
ACTUAL REMITTANCE: | US$ |
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