Exhibit 10.18

 

EXECUTION COPY

 

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PATENT, COPYRIGHT AND TECHNOLOGY LICENSE AGREEMENT

 

BY AND BETWEEN

 

LENOVO (BEIJING) LIMITED,

 

AND

 

LEGEND HOLDINGS LIMITED

 

YU BING

 

WANG ZHENG

 

for and on behalf of LWY

 

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CONTENTS

 

Clause

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          Page

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Article 1 Definitions    2 Article 2 License Grant    2        Section 2.1 Grant
   2        Section 2.2 Reservation of Rights    4        Section 2.3 Licensor
Obligations    4        Section 2.4 Scope of License    5        Section 2.5
Modifications to Schedule A    5        Section 2.6 Improvements    5       
Section 2.7 Limitations on Grant    5 Article 3 License Fee    5 Article 4
Excluded Intellectual Property Maintenance    6 Article 5 Enforcement    6  
     Section 5.1 Notice    6        Section 5.2. Enforcement Action    7 Article
6 Technical Assistance    7        Section 6.1 General Obligation to Disclose
Licensee Licensed Intellectual Property    7        Section 6.2 Assistance    7
Article 7 Term    8        Section 7.1 Term    8        Section 7.2 Right of
Termination    8 Article 8 Covenants    8        Section 8.1 License Limitations
   8        Section 8.2 Licensor’s Obligations    8 Article 9 Breach of Contract
   8 Article 10 Representations and Warranties    9        Section 10.1
Licensor’s Representations and Warranties    9        Section 10.2 No
Representation of Fitness for a Particular Purpose    9        Section 10.3 No
Other Representations and Warranties    10        Section 10.4 Liability    10
Article 11 Resolution of Disputes    10        Section 11.1 Dispute Resolution
Procedure    10        Section 11.2 Arbitration    10 Article 12 Miscellaneous
   11        Section 12.1 Entire Agreement    11        Section 12.2 Successors
and Assigns; No Third Party Rights    12        Section 12.3 Modification and
Waiver.    12        Section 12.4 Notices    12        Section 12.5 Governing
Law    12

 

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Section 12.6 Severability

   12       

Section 12.8 Section Headings

   12       

Section 12.9 Counterparts

   13       

Section 12.10 No Strict Construction

   13       

Section 12.11 Language

   13       

Section 12.12 Further Assurances

   13

 

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PATENT, COPYRIGHT AND TECHNOLOGY LICENSE AGREEMENT

 

SCHEDULES

 

SCHEDULE 1.1    DEFINITIONS SCHEDULE 2.1.1    LICENSEE LICENSED INTELLECTUAL
PROPERTY SUBJECT TO EXCLUSIVE LICENSE SCHEDULE 2.1.2    LICENSEE LICENSED
INTELLECTUAL PROPERTY SUBJECT TO NON-EXCLUSIVE LICENSE SCHEDULE 2.1.3   
LICENSEE LICENSED COPYRIGHT EXHIBIT A    ACCESSION INSTRUMENT

 

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PATENT, COPYRIGHT AND TECHNOLOGY LICENSE AGREEMENT

 

THIS PATENT, COPYRIGHT AND TECHNOLOGY LICENSE AGREEMENT (this “Agreement”),
dated as of October 19, 2004, is entered into by and between Legend Holdings
Limited, Yu Bing and Wang Zheng, for and on behalf of LWY (as defined below)
(“Licensee”), and Lenovo (Beijing) Limited, a company established under the laws
of the People’s Republic of China (“Licensor”) which is a wholly-owned
subsidiary of Lenovo Group Limited, a company organized under the laws of the
Hong Kong Special Administrative Region of the PRC, (“Seller”). Licensee on the
one hand, and Licensor on the other hand, are each sometimes referred to herein
as a “Party” and collectively as the “Parties” to this Agreement.

 

WHEREAS, AsiaInfo Holdings, Inc. (“Purchaser”) and Seller are parties to an
Acquisition Agreement dated as of July 27, 2004, as supplemented and amended
(the “Acquisition Agreement”) pursuant to which Seller has agreed to sell (and
cause the Selling Subsidiaries to sell) the Assets to Purchaser, and Purchaser
has agreed to purchase the Assets from Seller and the Selling Subsidiaries, on
the terms and subject to the conditions of the Acquisition Agreement.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the Parties, intending to be legally bound, hereby agree as
follows:

 

ARTICLE 1

Definitions

 

The capitalized terms used in this Agreement have the respective meanings set
forth in Schedule 1.1 or as defined herein. All other capitalized terms used and
not otherwise defined in this Agreement have the respective meanings set forth
in the Acquisition Agreement.

 

ARTICLE 2

License Grant

 

Section 2.1. Grant.

 

2.1.1. Subject to the terms and conditions set forth in this Agreement, Licensor
hereby grants to Licensee a limited, royalty-free, fully paid-up, worldwide,
exclusive license (without the right to sublicense except as provided in Section
2.1.4 below, and without the right to assign except as provided in Section 12.2
below), to the Licensee Licensed Intellectual Property identified on Schedule
2.1.1 hereto, to practice, make and use the inventions, ideas and information
embodied therein, and to make, use, offer to sell, sell, lease or import
Products, services, processes, methods and materials embodying or deriving from
the inventions, ideas and information from such Licensee Licensed Intellectual
Property solely in the conduct of the Licensed Business. For the purpose of this
Agreement, an exclusive license means a license from Licensor conferring on
Licensee, to the exclusion of all other persons (including Licensor), the rights
granted in this Agreement in respect of the Licensee Licensed Intellectual
Property in connection with the conduct of the Licensed Business. As to any item
of Licensee Licensed Intellectual Property, the term of such license shall
continue for the period of validity for such Licensee Licensed Intellectual
Property.

 

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2.1.2. Subject to the terms and conditions set forth in this Agreement, Licensor
hereby grants to Licensee a limited, royalty-free, fully paid-up, worldwide,
non-exclusive license (without the right to sublicense except as provided in
Section 2.1.4 below, and without the right to assign except as provided in
Section 12.2 below), to the Licensee Licensed Intellectual Property identified
on Schedule 2.1.2 hereto, to practice, make and use the inventions, ideas and
information embodied therein, and to make, use, offer to sell, sell, lease or
import Products, services, processes, methods and materials embodying or
deriving from the inventions, ideas and information from the Licensee Licensed
Intellectual Property solely in the conduct of the Licensed Business. As to any
item of Licensee Licensed Intellectual Property, the term of such license shall
continue for the period of validity for such Licensee Licensed Intellectual
Property.

 

2.1.3. Subject to the terms and conditions set forth in this Agreement, Licensor
hereby grants to Licensee a limited, royalty-free, fully paid-up, worldwide,
non-exclusive license (without the right to sublicense except as provided in
Section 2.1.4 below), and without the right to assign except as provided in
Section 12.2 below), to use, copy, develop and exploit the Licensee Licensed
Copyright for and in connection with the conduct of the Licensed Business,
including without limitation, to use, copy, develop and exploit for the purposes
of the development of all relevant software and system applications and websites
in relation to the conduct of the business of the Security Services Division.
The Licensee may make as many copies of the Licensee Licensed Copyright as are
reasonably necessary for the ordinary use of the Licensee Licensed Copyright and
for archival and back-up purposes. The term of such license shall continue for
the period of validity for such Licensee Licensed Intellectual Property.

 

2.1.4. Sublicense Rights.

 

(a) Licensor hereby grants to Licensee the right to sublicense its rights
granted under this Agreement only to Purchaser, Purchasing Subsidiaries and
Lenovo Computer System Technology Services Limited (each, a “Sublicensee”), in
each case engaged in the conduct of the Licensed Business; provided that
Licensee ensures that each such Sublicensee executes an accession instrument in
order to accede to this Agreement and establish contractual privity with
Licensor, and each such sublicense is limited solely to use in connection with
such sublicensee’s conduct of the Licensed Business. A form of such accession
instrument is attached hereto as Exhibit A.

 

(b) By execution of an accession instrument to this Agreement, such Sublicensee
shall acknowledge that the technology that is subject to this Agreement
constitutes or comprises confidential information and shall agree that any use
or disclosure by such Sublicensee of such confidential information beyond that
expressly authorized in this Agreement is prohibited.

 

(c) Licensee shall use best efforts as appropriate to ensure that each
Sublicensee complies with the restrictions on use and disclosure of confidential
information in this Agreement and the applicable sublicense. If Licensee
reasonably suspects, or if Licensor

 

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notifies Licensee that Licensor reasonably suspects, that a Sublicensee is not
in compliance with restrictions on use and disclosure of confidential
information in this Agreement, Licensee agrees to use best efforts as
appropriate to cooperate with Licensor in investigating such non-compliance. If,
after such investigation, Licensor reasonably believes that a Sublicensee is not
in compliance with the restrictions on use and disclosure of confidential
information in this Agreement, then Licensor may request, and Licensee shall
arrange, a timely audit of the Sublicensee’s compliance with such restrictions
in this Agreement, at Licensor’s sole expense, and by a Third Party auditor
selected by Licensee and approved by Licensor. If Licensee reasonably believes a
Sublicensee is not in compliance with the restrictions on use and disclosure of
confidential information in this Agreement, then Licensee shall promptly notify
Licensor thereof and may arrange an audit, at Licensee’s sole expense, by a
Third Party auditor selected by Licensee. The Third Party auditor shall
determine the scope of the audit and disclose the results of any such audit
conducted pursuant to this Section 2.1.4(c) only to Licensee, and Licensee shall
share all such results with Licensor as soon as possible. If the results of any
such audit show that the Sublicensee is not in compliance with the restrictions
on use and disclosure of confidential information in this Agreement, then
Licensee shall (i) take appropriate steps to address such non-compliance, (ii)
take immediate action to stop any such use or disclosure that violates such
restrictions and retrieve, to the extent possible, any confidential information
of Licensor, (iii) immediately terminate the sublicense of any Sublicensee
willfully or negligently at fault for a material violation of such restrictions
and (iv) promptly notify Licensor of any sublicense that has been terminated
pursuant to this Section 2.1.4(c).

 

(d) The Parties agree that each Sublicensee, if any, shall accede to Licensee’s
obligations under this Agreement so that Licensor may take legal or other action
for damages and all other appropriate relief and exercise any other rights or
remedies that Licensor or Licensee may have at law or in equity against such
Sublicensee relating to, or arising from, such Sublicensee’s breach of its
agreement to sublicense hereunder. At Licensor’s expense, Licensee shall
reasonably cooperate with Licensor in such taking of legal action or exercising
of such rights or remedies. Further, Licensor may, to the extent not
inconsistent with the provisions of Article 11 hereof, take any action or pursue
or exercise any right, remedy or action against Licensee to the extent caused
by, arising out of, or in connection with or relating to, any of Licensee’s
inaction or any breach of, or failure to perform, any obligation or covenant of
Licensee under this Agreement in connection with any breach by Sublicensee of
its agreement to sublicense hereunder.

 

Section 2.2. Reservation of Rights. All rights not expressly granted by Licensor
hereunder are reserved to Licensor. Without limiting the generality of the
foregoing, Licensor and Licensee expressly acknowledge that nothing contained
herein shall be construed or interpreted as a grant, by implication or
otherwise, of any licenses other than the licenses specified in Section 2.1.

 

Section 2.3. Licensor Obligations. Licensor hereby acknowledges and agrees that
it shall, and shall cause its Affiliates to, execute or deliver any further
instruments, information, explanations or documents and take all such further
action as may be necessary to grant to Licensee the licenses hereunder, to
enable Licensee to practice, make and use the invention, technology or ideas
covered by the Licensee Licensed Intellectual Property and to use, develop

 

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and exploit the Licensee Licensed Copyright, and for Licensee to fully enjoy all
of the rights and benefits to, the Licensee Licensed Intellectual Property as
provided in this Agreement, subject in each case to the limitations herein
described.

 

Section 2.4. Scope of Licenses. The Parties expressly and specifically agree
that the licenses granted herein shall be limited to, and the Licensee Licensed
Intellectual Property shall not be used beyond, the Licensed Business. Licensee
acknowledges that the technology that is subject to this Agreement constitutes
or comprises confidential information and shall agree that any use or disclosure
by such Licensee of such confidential information beyond that expressly
authorized in this Agreement is prohibited.

 

Section 2.5. Modifications to Schedules 2.1.1 and 2.1.2. The Parties agree that,
when and if it becomes necessary during the term of this Agreement for Licensee,
Purchaser or the Purchasing Subsidiaries to use any other or any, as the case
may be, Intellectual Property Rights (other than the Lenovo Trademarks) that are
being used or are held for use by Licensor in the conduct of the Licensed
Business as of the Closing Date in order for Licensee, Purchaser or the
Purchasing Subsidiaries to properly conduct such business as contemplated
hereunder and under the Acquisition Agreement, Licensor shall, and Seller shall
procure the relevant Selling Subsidiaries to, grant to the Licensee a license in
respect of such Intellectual Property Rights (other than the Lenovo Trademarks,
which are subject to a separate agreement by and among the parties) on the same
terms and conditions as set forth in this Agreement and such Intellectual
Property Rights shall be regarded as Licensee Licensed Intellectual Property for
the purpose of this Agreement and Schedule 2.1.1 or 2.1.2, as the case may be,
shall, from the date of the relevant grant, be deemed to be modified to include
such Intellectual Property Rights.

 

Section 2.6. Improvements. Subject to Section 7.3(c) of the Supplement, all
improvements and enhancements to the Licensee Licensed Intellectual Property
made, developed, created, invented or discovered by Licensee and/or any
Sublicensee shall belong to Licensee and/or such relevant Sublicensee.

 

Section 2.7. Limitations on Grant. Licensee expressly acknowledges and agrees
that (i) all of its rights to use the Licensee Licensed Intellectual Property
are set forth herein, (ii) nothing herein shall be construed to convey any
rights to Licensee in any Intellectual Property Rights of Licensor or its
Affiliates (including, without limitation, any improvements or enhancements made
by Licensor or its Affiliates to any of the Intellectual Property Rights granted
by Licensor and its Affiliates to Licensee hereunder), which in their entirety
are made, developed, conceived, or otherwise created without contribution by
Licensee or its Affiliates after the date of this Agreement and (iii) it shall
use the licenses granted pursuant to Sections 2.1 to the Licensee Licensed
Intellectual Property exclusively in the Licensed Business. Notwithstanding
anything else herein, each license herein granted to any registered patent is
limited to the territory or jurisdiction in which such registered patent has
been issued.

 

ARTICLE 3

Consideration

 

The consideration for the license granted hereunder consists of the substantial
benefits derived by Licensor and Licensee from the Purchaser’s purchase of the
Assets from the Seller, as set forth in the Acquisition Agreement, and the
consummation of the transactions contemplated thereby, there being no further
consideration or royalty payable in respect thereof.

 

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ARTICLE 4

Licensee Licensed Intellectual Property Maintenance and Registration of
Agreement

 

Section 4.1. Maintenance of Patents. Except as stated in the proviso to the
following sentence, neither Licensor, nor any of its Subsidiaries, is required
to file any patent application, or to secure any patent or patent rights, or to
maintain any Licensee Licensed Intellectual Property in force. Payment of
maintenance fees and the taking of any other appropriate maintenance action for
the Licensee Licensed Intellectual Property listed on Schedules 2.1.1 and 2.1.2
shall be at the sole discretion of, and is the financial responsibility of,
Licensor; provided, however, that Licensor agrees that for twenty-four (24)
months from the Closing Date, Licensor shall pay all of the maintenance fees and
take any and all other appropriate maintenance action for the Licensee Licensed
Intellectual Property in Schedule 2.1.1 and 2.1.2; provided further that in no
event shall such fees include any fees payable in respect of recording this
Agreement on behalf of Licensee, which fees shall be borne by Licensee.
Following such twenty-four (24) month period, in the event that Licensor decides
not to maintain any such Patents, Licensor will give Licensee written notice of
such decision at least three (3) months prior to the date that appropriate
maintenance action must be taken provided that such notice period of three (3)
months shall not apply if Licensor receives any notice from the relevant
Government Authority with regard to any application of any Patents and the
period within which any appropriate maintenance action required to be taken in
respect of such Patent application is less than three (3) months from the date
such notice is issued, in which case, if Licensor decides not to maintain such
Patent application, Licensor shall, within five (5) Business Days of receiving
such notice, give written notice of such decision to Licensee, and Licensee will
have the option of taking the appropriate maintenance action with respect to
such Patents and maintaining the application or registration to such Patents for
no additional consideration to Licensor in accordance with the terms of this
Agreement and Licensor shall forthwith execute any necessary documents or
instruments for transferring and assigning all right, title and interest that
Licensor has in such Patents to Licensee at Licensee’s cost and expense but for
no additional consideration to Licensor. If Licensee does not take such
maintenance action before the deadline for taking such action, then such
Licensee Licensed Intellectual Property will be permitted to lapse.

 

Section 4.2. Licensee shall be responsible for the registration or approval of
this Agreement by the relevant local authorities as required by local law and
regulations in respect of the rights granted pursuant to Section 2.1 and bear
the relevant fees in respect thereof.

 

ARTICLE 5

Enforcement

 

Section 5.1. Notice.

 

5.1.1. Licensee agrees to promptly notify Licensor in writing of any
infringement or misappropriation of any of the Licensee Licensed Intellectual
Property to which Licensee or any Sublicensee becomes aware and will provide
Licensor with any and all evidence in its possession, if any, of such
infringement or misappropriation.

 

5.1.2. Licensor agrees to promptly notify Licensee in writing of any
infringement or misappropriation of any of the Licensee Licensed Intellectual
Property to which Licensor becomes aware and will provide Licensee with any and
all evidence in its possession, if any, of such infringement or
misappropriation.

 

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Section 5.2. Enforcement Action.

 

5.2.1. In the event of any infringement or misappropriation of the Licensee
Licensed Intellectual Property, Licensor will have the right to determine an
appropriate course of action to enforce such Licensee Licensed Intellectual
Property or otherwise abate the infringement or misappropriation thereof, to
take (or refrain from taking) appropriate action to enforce such Licensee
Licensed Intellectual Property, and, in the event that Licensor elects to take
action, to control any litigation or other enforcement action, to enter into or
permit the settlement of any such litigation or any other enforcement action
with respect to such Licensee Licensed Intellectual Property, and to recover and
retain any monetary damages, settlement, royalties or other recovery arising
from such litigation or other enforcement action. Licensee will use reasonable
efforts to cooperate with Licensor at Licensor’s expense, in any litigation or
enforcement action under this Section 5.2.1 and Licensee will join as a party to
any such litigation or other enforcement action as required by Law at Licensor’s
expense. Licensor shall indemnify and hold harmless Licensee against any and all
Losses arising out of or in relation to (i) any such cooperation given by
Licensee to Licensor and (ii) Licensee joining as a party to such litigation or
other enforcement action, which Losses may include, without limitation, payment
by Licensee of any Third Party legal costs as a result of Licensee joining as a
party to such litigation or enforcement action.

 

5.2.2. In the event that Licensor takes no action against such infringer or
unauthorised user, within three (3) months of the date on which it first learns
of such misappropriation or infringement, then subject to Licensor’s consent
(which shall not be unreasonably withheld), Licensee may take such action in the
name of Licensor or in its own name, as it shall see fit and Licensor shall
co-operate fully, at Licensee’s expense, with Licensee in respect thereof.
Licensee shall be entitled to retain any monetary damages, settlement, royalties
or other recovery, if any, recovered or obtained in any proceedings or action
taken by Licensee at its own expense.

 

ARTICLE 6

Technical Assistance

 

Section 6.1. General Obligation to Disclose Licensee Licensed Intellectual
Property. Licensor shall provide Licensee appropriate disclosure of the Licensee
Licensed Intellectual Property as necessary for Licensee, Purchaser or any
Purchasing Subsidiary to continue to conduct the Licensed Business as it was
conducted on the Closing Date, and for a period of twenty-four (24) months
following the Closing Date shall otherwise provide reasonable assistance
necessary for Licensee to use, practice and otherwise enjoy the benefit of the
rights to the Licensee Licensed Intellectual Property granted to Licensee
hereunder.

 

Section 6.2. Assistance. For a period of twenty-four (24) months following the
Closing Date, and upon prior notice from Licensee, Licensor shall grant to
Licensee reasonable access to Licensor’s technical personnel who have sufficient
knowledge of the Licensee Licensed Intellectual Property to provide assistance
reasonably necessary for the use herein contemplated of the Licensee Licensed
Intellectual Property. All reasonable and out-of-pocket costs and expenses
(which shall not include the time incurred by the Licensor’s technical
personnel) incurred in connection therewith shall be borne by Licensee.

 

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ARTICLE 7

Term

 

Section 7.1. Term. This Agreement shall become effective as of the date first
above written and as to any item of Licensee Licensed Intellectual Property, the
rights and obligations contained herein shall continue during the validity of
such Licensee Licensed Intellectual Property, except as may be otherwise
provided herein.

 

Section 7.2. Right of Termination. Notwithstanding Section 7.1, upon providing
prior written notice of termination to Licensee, Licensor may terminate this
Agreement and the license hereunder if Licensee or any of its Sublicensees
violates, defaults or fails to perform any of its respective covenants,
obligations, agreements, representations or warranties contained herein, which
violation, default or failure is material and not cured within ninety (90) days
after receipt of a written notice thereof from Licensor. Further, Licensor may
automatically terminate this Agreement and the licenses granted by it hereunder
without notice to Licensee in the event that Licensee or Purchaser makes a
general assignment for the benefit of its creditors, or ceases operations, or is
liquidated.

 

ARTICLE 8

Covenants

 

Section 8.1. License Limitations.

 

All covenants contained herein shall run with all patents, patent applications
and invention disclosures of Licensor and its Affiliates in existence as of the
Closing Date and constituting Licensee Licensed Intellectual Property, and shall
be binding on successors and assigns thereof.

 

Section 8.2. Licensor’s Obligations. If the use of any part of the Licensee
Licensed Copyright is an infringement of the rights of another person, the
Licensor shall at its option: (a) replace the relevant Licensee Licensed
Copyright or any infringing part of them with a comparable non-infringing
software product or document (as applicable) (without any degradation in
performance or functionality); or (b) procure for the Licensee and Purchaser the
right to continue using the relevant Licensee Licensed Copyright (or any part of
them).

 

ARTICLE 9

Breach of Contract

 

Section 9.1. If either Party shall breach its obligations under this Agreement,
such breaching party shall be responsible to the other Party for all direct
losses or damages caused by such breach, including without limitation lost
profits suffered by the non-breaching party. The Parties expressly agree that,
in the event a Party violates, defaults or fails to perform any of its
respective covenants, obligations, agreements, representations or warranties
contained herein, in addition to Licensor’s right to terminate under Article 7,
full legal remedy shall remain available to the non-defaulting party in such
violation, default or failure, including the right to recover monetary damages
or to secure such other relief appropriate to the circumstances, provided that
no immaterial violation, default or failure to perform shall result in relief
that unreasonably disrupts the operation of the Business.

 

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Section 9.2. Except as expressly provided in Section 5.2.1 of this Agreement,
neither Party is liable to the other Party, whether for negligence, breach of
contract, misrepresentation or otherwise, for:

 

(a) loss or damage incurred by the other Party as a result of third party
claims; or

 

(b) indirect or consequential damage suffered by the other Party, including
without limitation, loss of profit, goodwill, business opportunity or
anticipated savings.

 

ARTICLE 10

Representations and Warranties

 

Section 10.1. Licensor’s Representations and Warranties. Licensor represents and
warrants to Purchaser and Licensee that:

 

10.1.1. to its knowledge, none of the Licensee Licensed Intellectual Property
infringes upon or misappropriates the rights of any Third Party nor is infringed
upon or misappropriated by any Third Party or its property;

 

10.1.2. there has been no unauthorized use by, disclosure to or by or
infringement, misappropriation or other violation of any of the Licensee
Licensed Intellectual Property by any Third Party and/or any current or former
officer, employee, independent contractor, consultant or any other agent of
Licensor or Seller’s Subsidiaries;

 

10.1.3. Licensee’s use of any of the Licensee Licensed Intellectual Property
strictly in accordance with this Agreement and the express instructions of
Licensor does not and will not infringe upon any Intellectual Property Rights or
any other rights of any Third Party;

 

10.1.4. to the knowledge of Seller or its Subsidiaries, the Licensee Licensed
Software does not contain any material computer viruses, worms, software bombs
or similar items; and

 

10.1.5. Licensor has full right and authority to grant the licenses set out in
Section 2.

 

Section 10.2. No Representation of Fitness for a Particular Purpose. ALL
LICENSEE LICENSED SOFTWARE AND LICENSEE LICENSED DOCUMENTATION (INCLUDING ANY
ASSOCIATED INTELLECTUAL PROPERTY RIGHTS GRANTED HEREUNDER) ARE FURNISHED “AS IS”
AND WITHOUT ANY REPRESENTATIONS OR WARRANTIES WITH RESPECT TO FITNESS FOR A
PARTICULAR USE OR MERCHANTABILITY.

 

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Section 10.3. No Other Representations and Warranties. OTHER THAN THE
REPRESENTATIONS AND WARRANTIES SET FORTH IN SECTION 10.1 ABOVE, LICENSOR MAKES
NO REPRESENTATION OR WARRANTY REGARDING THE VALIDITY OR ENFORCEABILITY OF THE
LICENSEE LICENSED INTELLECTUAL PROPERTY.

 

Section 10.4. Liability. OTHER THAN THE REPRESENTATIONS AND WARRANTIES SET FORTH
IN SECTION 10.1 ABOVE, LICENSOR MAKES NO OTHER REPRESENTATIONS, WARRANTIES, OR
COVENANTS, EXPRESS OR IMPLIED, NOR SHALL LICENSOR HAVE ANY LIABILITY, IN RESPECT
OF ANY INFRINGEMENT OF INTELLECTUAL PROPERTY OR OTHER RIGHTS OF THIRD PARTIES
DUE TO LICENSEE’S ACTS OR OMISSIONS WITH RESPECT TO THE RIGHTS HEREIN GRANTED
PROVIDED THAT THIS EXCLUSION OF LIABILITY SHALL NOT APPLY IN RESPECT OF ANY
LIABILITY ARISING AS A RESULT OF ANY BREACH OR INACCURACY OF THE REPRESENTATIONS
AND WARRANTIES SET FORTH IN SECTION 10.1 ABOVE.

 

ARTICLE 11

Resolution of Disputes

 

Section 11.1. Dispute Resolution Procedure. The Parties will cooperate in good
faith and use reasonable efforts to informally resolve any disputes, controversy
or claim (“Dispute”) arising out of or relating to this Agreement, or the
interpretation, breach, termination or validity hereof. Except as otherwise
provided in Section 11.2.4, if the Parties are not able to informally resolve a
dispute under this Agreement within thirty (30) days after such dispute arises,
the following procedure will be used:

 

11.1.1. one Party will serve upon the other Party a “Notice of Dispute” that
summarizes the nature of the dispute and the efforts taken to resolve that
Dispute to date;

 

11.1.2. within fifteen (15) Business Days of receipt of the Notice of Dispute,
the Parties will conduct one or more meetings (which may take place by
teleconference) of management level-representatives of each Party with knowledge
of the subject matter of the dispute, which representatives will use
commercially reasonable efforts to resolve the Dispute;

 

11.1.3. if the Dispute is not resolved at the meeting or meetings described in
Section 11.1.2, then within fifteen (15) Business Days from the date of the last
meeting, the Parties will schedule one or more meetings (which may take place by
teleconference) of executive-level representatives of each Party, which
representatives will use commercially reasonable efforts to resolve the dispute;
and

 

11.1.4. if, following the last executive-level meeting, the dispute remains
unresolved, then such dispute will be finally settled by binding arbitration
conducted in accordance with Section 11.2 below.

 

Section 11.2. Arbitration. Except as otherwise provided in Section 11.2.4 below,
if the Parties are unable to resolve a Dispute in accordance with Section 11.1,
then the Party that served the Notice of Dispute on the other Party must submit
the Dispute to arbitration by the

 

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Hong Kong International Arbitration Centre under the rules of UNCITRAL (the
“Rules”) as are in force at the date of the notice of arbitration commencing any
such arbitration, but subject to the amendments made to the Rules by the rest of
this Section 11.2. For the purpose of such arbitration, there shall be a board
of arbitration (the “Board of Arbitration”) consisting of three arbitrators,
each of Licensor and Licensee shall select one (1) member and the third member
shall be selected by mutual agreement of the other members, or if the other
members fail to reach agreement on a third member within twenty (20) days after
their selection, such third member shall thereafter be selected by the Hong Kong
International Arbitration Centre upon application made to it for such purpose.
The place of arbitration shall be in Hong Kong. All arbitration proceedings
shall be conducted in the English language. The arbitrators shall decide any
such Dispute or claim strictly in accordance with the governing law specified in
Section 12.5 of this Agreement. Judgment upon any arbitral award rendered
hereunder may be entered in any court, and/or application may be made to any
such court for a judicial acceptance of the award and/or an order of
enforcement, as the case may be.

 

11.2.1 Each Party shall cooperate in good faith to expedite (to the maximum
extent practicable) the conduct of any arbitral proceedings commenced under this
Agreement.

 

11.2.2 The costs and expenses of the arbitration, including the fees of the
arbitration, shall be borne equally by each Party to the Dispute or claim, and
each Party shall pay its own fees, disbursements and other charges of its
counsel.

 

11.2.3 Any award made by the Board of Arbitration tribunal shall be final and
binding on each of the Parties that were Parties to the Dispute and their
respective successors and assigns. The Parties expressly agree to waive the
applicability of any laws and regulations that would otherwise give the right to
appeal the decisions of the Board of Arbitration so that there shall be no
appeal to any court of law from the award of the Board of Arbitration, and a
Party shall not challenge or resist the enforcement action taken by any other
Party in whose favor an award of the arbitration tribunal was given.

 

11.2.4 Notwithstanding this Section 11.2 or any other provision to the contrary
in this Agreement, no Party shall be obligated to follow the foregoing
arbitration procedures where that Party intends to apply to any court of
competent jurisdiction for an interim injunction or similar equitable relief
against the other, provided there is no unreasonable delay in the prosecution of
that application.

 

11.2.5 This Agreement and the rights and obligations of the Parties shall remain
in full force and effect pending the award in any arbitration proceeding
hereunder.

 

ARTICLE 12

Miscellaneous

 

Section 12.1. Entire Agreement. This Agreement (including the Schedules attached
hereto or delivered in connection herewith), the Acquisition Agreement
(including the Schedules and Exhibits attached thereto or delivered in
connection therewith), the Supplement, the Transaction Documents and the
Confidentiality Agreement, constitute the entire agreement between the Parties
and supersede all prior agreements and understandings, oral and written, between
the Parties with respect to the subject matter hereof and thereof, including,
without

 

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limitation, Section 5.22 of the Acquisition Agreement. If there is conflict or
contradiction between this Agreement and the other agreements mentioned above,
this Agreement shall prevail in relation to any issues arising out of or in
connection with the Licensee Licensed Intellectual Property.

 

Section 12.2. Successors and Assigns.

 

12.2.1. The terms and conditions of this Agreement will inure to the benefit of,
and be binding upon, the respective successors and assigns of the Parties
hereto. This Agreement and the license and other rights granted or created
hereunder may not be assigned, in whole or in part, by Licensee without the
prior written consent of Licensor, and any attempted assignment shall be null
and void.

 

12.2.2. Nothing in this Agreement, express or implied, is intended to confer any
rights or remedies hereunder on any Person other than Licensee or Licensor and
their respective Affiliates or any of their respective successors and permitted
assigns.

 

Section 12.3. Modification and Waiver. No amendment, modification or alteration
of the terms or provisions of this Agreement will be binding unless the same is
in writing and duly executed by each of the Parties hereto, except that any of
the terms or provisions of this Agreement may be waived in writing at any time
by the Party which is entitled to the benefits of such waived terms or
provisions. No waiver of any of the provisions of this Agreement will be deemed
to, or will, constitute a waiver of any other provision hereof (whether or not
similar). No delay on the part of any Party to this Agreement in exercising any
right, power or privilege hereunder will operate as a waiver thereof.

 

Section 12.4. Notices. Any notice, request, instruction or other document or
communications required or permitted to be given hereunder by any Party to any
other Party will be provided in accordance with the terms of Section 9.1 of the
Acquisition Agreement.

 

Section 12.5. Governing Law. The laws of the People’s Republic of China will
govern the interpretation, construction, validity, performance and enforcement
of this Agreement.

 

Section 12.6. Severability. If any provision of this Agreement or the
application of any such provision to any Person, Party or circumstance will be
held invalid, illegal or unenforceable in any respect by a court of competent
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision of this Agreement and this Agreement will remain in full
force and effect and will be effectuated as if such illegal, invalid or
unenforceable provision is not part thereof.

 

Section 12.7. Schedules. The Parties hereto acknowledge and agree that the
Schedules attached hereto are an integral part of this Agreement, and are hereby
incorporated by reference herein and made a part hereof.

 

Section 12.8. Section Headings. The Recitals, the Table of Contents, the List of
Schedules and the headings of the articles, sections and paragraphs contained in
this Agreement are inserted for convenience only and will not be deemed to
constitute part of this Agreement or to affect the construction thereof.

 

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Section 12.9. Counterparts. This Agreement may be executed in two or more
counterparts, each of which will for all purposes be deemed to be an original
but all of which together will constitute one and the same instrument.

 

Section 12.10. No Strict Construction. Licensor and Licensee each acknowledge
that this Agreement has been prepared jointly by the Parties and shall not be
strictly construed against any Party.

 

Section 12.11. Language. This Agreement is written in the English language. Any
Chinese version of this Agreement shall be for convenience purposes only and
shall not affect the interpretation hereof.

 

Section 12.12. Further Assurances. Each Party shall do and execute, or arrange
for the doing and executing of, each necessary act, document and thing to
implement this Agreement, including without limitation executing and delivering
and recording any license required by local law, with terms consistent with this
Agreement to the extent permitted by such local law, in the relevant country or
jurisdictions.

 

Section 12.13. Licensor Acknowledgement Regarding LWY Licensor acknowledges that
Legend Holdings Limited, Yu Bing and Wang Zheng are executing this Agreement as
promoters and shareholders of LWY only and LWY shall, after its incorporation,
ratify this Agreement by executing this Agreement in the manner provided below.
From the date this Agreement is ratified by LWY, LWY shall, for all intent and
purposes, be regarded as having entered into this Agreement as Licensee as if it
had already been incorporated as of the day and year first above written and
thereby replacing Legend Holdings Limited, Yu Bing and Wang Zheng as Licensee.

 

[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.]

 

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IN WITNESS WHEREOF, each of the Parties have caused this Agreement to be duly
executed in duplicate originals by their duly authorized representatives as of
the day and year first above written.

 

LICENSOR LENOVO (BEIJING) LIMITED By:  

/s/ Yang Yuanqing

--------------------------------------------------------------------------------

Name:   Yang Yuanqing Title:   Chief Executive Officer

 

LICENSEE

           LEGEND HOLDINGS LIMITED      YU BING

for and on behalf of LWY

     for and on behalf of LWY

By:

 

/s/ Tang Xudong

--------------------------------------------------------------------------------

    

By:

 

/s/ Yu Bing

--------------------------------------------------------------------------------

Name:

 

Tang Xudong

     Name:  

Yu Bing

Title:

 

Vice President

          

 

WANG ZHENG

for and on behalf of LWY

By:  

/s/ Wang Zheng

--------------------------------------------------------------------------------

Name:   Wang Zheng      

 

We hereby ratify this Agreement as of the date and year set forth below:

 

LWY

By:

 

 

--------------------------------------------------------------------------------

Name:

    Title:     Date:    

 

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Patent, Copyright and Technology License Agreement

 

Schedule 1.1

Definitions

 

As used in this Agreement, each of the following capitalized terms will have the
respective meanings set forth below:

 

“Agreement” means this Patent, Copyright and Technology License Agreement and
each and all of the Schedules referred to in, or attached to this Agreement, as
may be amended from time to time by mutual agreement of the Parties in
accordance with Section 12.3.

 

“Incidental Code” means any portion of Licensee Licensed Software, which portion
was, on or prior to the Closing Date, included with or in products, programs, or
services (other than Products) of Licensor or its Subsidiaries, or was developed
by Licensor employees not assigned to Licensor’s Licensed Business.

 

“Intellectual Property Rights” means all rights, title and interest in and to
any Intellectual Property.

 

“Law” means all Chinese national or local laws, regulations and rules or, as
applicable, the federal, state or local constitutions, statutes, codes, rules,
regulations, ordinances, executive orders, decrees or edicts by a Governmental
Authority of another competent jurisdiction having the force of law.

 

“Licensed Business” means the provision by Purchaser or its Subsidiaries after
the Closing Date of products and services (other than hardware support and
maintenance services) offered by the Business (other than the Telecommunications
Applications Services Division or the Insurance IT Services Division) prior to
the Closing Date (and any such product or service after the Closing Date whose
components have been enhanced or upgraded if the resulting product or service
provides the same function as the product or service to which it is a successor)
to any customer segment, but in all events excluding (i) products and services
offered or provided to individual customers and consumers and (ii) activities
relating to Server Products or terminal devices of any kind, including, without
limitation, personal digital assistants (PDAs), personal computers, mobile phone
handsets, etc.

 

“Licensee Licensed Copyright” means the Licensee Licensed Software and Licensee
Licensed Documentation listed in Schedule 2.1.3.

 

“Licensee Licensed Documentation” means the tangible embodiments of information,
technology, ideas, concepts, know-how, techniques and scientific, technical,
research, development, engineering and business information, identified in
Schedules 2.1.1, 2.1.2 and 2.1.3 as such. The term “Licensee Licensed
Documentation” excludes embodiments of Third Party information, even if such
information is included in the items identified in Schedules 2.1.1, 2.1.2 and
2.1.3.

 

“Licensee Licensed Intellectual Property” means the Intellectual Property
Rights, including the Patents listed in Schedules 2.1.1 and 2.1.2 hereto.

 

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“Licensee Licensed Software” means the software programs identified on Schedule
2.1.3, in Object Code form, Source Code form, or both, as indicated in Schedule
2.1.3. Notwithstanding the preceding sentence, Licensee Licensed Software does
not include (even if included in a software program identified in Schedule
2.1.3):

 

  (i) programs not used exclusively by Licensor in making Products on the
Closing Date;

 

  (ii) Incidental Code; or

 

  (iii) Third Party Programs.

 

“LWY” means the corporation to be incorporated pursuant to Section 5.1 of the
Supplement.

 

“Object Code” means computer programming code substantially in binary form that
is directly executable by a computer after processing, but without compilation
or assembly.

 

“Product” means any product or material which incorporates or uses any portion
of the Licensee Licensed Intellectual Property.

 

“Server Products” shall mean any server, blade, thin client or similar product
generally used through a network where access to such server or product may be
shared simultaneously by multiple users, accessed by a single user, or another
server product(s).

 

“Source Code” is computer programming code other than Object Code that may be
displayed in a form readable and understandable by a programmer of ordinary
skill.

 

“Supplement” means the Supplement and Amendment No. 1 to the Acquisition
Agreement.

 

“Third Party” means a Person other than a Party or any director, officer or
employee of a Party or an Affiliate of a Party or their successors and assigns
hereunder.

 

“Third Party Programs” means all software programs or portions thereof in Object
Code form, Source Code form, or both in which copyrights are owned by Third
Parties.

 

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Schedule 2.1.1

 

LICENSEE LICENSED INTELLECTUAL PROPERTY SUBJECT TO EXCLUSIVE LICENSE

 

LOGO [g70338g43d18.jpg]

 

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Schedule 2.1.2

 

LICENSEE LICENSED INTELLECTUAL PROPERTY SUBJECT TO NON-EXCLUSIVE LICENSE

 

LOGO [g70338g59j71.jpg]

 

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Schedule 2.1.3

 

LICENSEE LICENSED COPYRIGHT

 

All software programs, including the Source Code and the Object Code, and the
design documentation relating to the electronic system LOGO [g70338exb_221.jpg]
the sales system LOGO [g70338exb_222.jpg] and the RB system LOGO
[g70338exb_223.jpg] used in the conduct of the business of the Security Service
Division, developed by Seller and/or its Affiliates based on and are additions
to their standard information systems.

 

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Exhibit A

 

ACCESSION AGREEMENT

 

THIS ACCESSION AGREEMENT (this “Agreement”), dated as of                     ,
20    , is entered into by and between                      (“Sublicensee”), a
corporation organized under the laws of                     , [LWY], a company
established under the laws of the People’s Republic of China (“Licensee”), and
Lenovo (Beijing) Limited, a company established under the laws of the People’s
Republic of China (“Licensor”).

 

WHEREAS, reference is made to that certain Acquisition Agreement dated as of
July 27, 2004, as supplemented and amended (the “Acquisition Agreement”) by and
between Seller and Lenovo Group Limited (“Seller”) and that certain Patent,
Copyright and Technology License Agreement (the “License Agreement”), dated as
of                     , 2004, by and between Licensee and Licensor.

 

WHEREAS, the License Agreement allows Licensee to sublicense certain rights to
Sublicensee and Licensee wishes Sublicensee to accede to the License Agreement
in order to establish contractual privity with Licensor and thereby obtain the
same rights and obligations of Licensee under the License Agreement without
releasing Licensee from its obligations thereunder.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the Parties, intending to be legally bound, hereby agree as
follows:

 

Section 1. Capitalized terms used by not defined herein have the respective
meanings ascribed to them in the License Agreement.

 

Section 2. Sublicensee hereby accedes to the License Agreement as if originally
a party thereto for purposes of the rights granted to it pursuant to Sections
2.1.1, 2.1.2 and 2.1.3 thereof and agrees to be bound by all terms and
conditions of the License Agreement pertaining to such rights as if originally a
party thereto as “Licensee”, with such terms and conditions applying mutatis
mutandis to Sublicensee, and Sublicensee having contractual privity with
Licensor.

 

Section 3. Licensee hereby acknowledges that it remains bound by the terms and
conditions of the License Agreement and that Sublicensee’s accession to the
License Agreement shall not operate as a novation, assignment, substitution or
release, of any kind, of Licensee or any of its duties or obligations under the
License Agreement. Licensee acknowledges that it shall be responsible for the
acts of Sublicensee under the License Agreement and shall require that
Sublicensee complies with all of the obligations imposed on Licensee in relation
to the rights sublicensed hereunder that are contained in the License Agreement
which obligations shall be fully incorporated in the sublicense granted
hereunder. Failure of or breach by Sublicensee to meet its obligations under the
sublicense granted hereunder shall be deemed a failure or breach attributable to
Licensee, as though Licensee itself had committed the act or omission of
Sublicensee and shall entitle Licensor to take action against Licensee or
Sublicensee as set forth in the License Agreement to terminate the license
grant.

 

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IN WITNESS WHEREOF, each of the Parties have caused this Agreement to be duly
executed in duplicate originals by their duly authorized representatives as of
the day and year first above written.

 

LICENSOR

LENOVO (BEIJING) LIMITED

By:

 

 

--------------------------------------------------------------------------------

Name:

   

Title:

   

LICENSEE

[LWY]

By:

 

 

--------------------------------------------------------------------------------

Name:

   

Title:

   

SUBLICENSEE

[                            ]

By:

 

 

--------------------------------------------------------------------------------

Name:

   

Title:

   

 

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