**EXHIBIT 10.14**

 

PATENT CROSS-LICENSE AGREEMENT

 

This PATENT CROSS-LICENSE AGREEMENT (this “Agreement”) is madeand entered into as of November 12, 2004 (the “Effective Date”) byand between, on the one hand, Polycom, Inc., a Delaware corporation,having offices at 4750 Willow Road, Pleasanton, CA 94588 (“Polycom”),and, on the other hand, Avistar Communications Corporation, a Delawarecorporation, (“Avistar Communications”) having offices at 555 TwinDolphin Drive, Suite 360, Redwood Shores, California 94065 together withits wholly owned subsidiary Collaboration Properties, Inc., a Nevadacorporation, (“CPI”) having offices at 555 Twin Dolphin Drive, Suite 360, Redwood Shores, California 94065(collectively, “Avistar “) (Polycom and Avistar are individually referredto herein as a “party,” and collectively as the “parties”).

 

WITNESSETH

 

WHEREAS, Avistar has filed claims against Polycom for patentinfringement in an action styled Collaboration Properties, Inc. v. Polycom, Inc.,Case # 02-CV-04591, pending in the United States District Court for theNorthern District of California, and Polycom has asserted counterclaims for, *inter alia*, patent infringement,invalidity and unenforceability, against Avistar (the “Litigation”);

 

WHEREAS,Polycom and Avistar are concurrently entering into a Settlement Agreement underwhich the parties are settling and releasing all outstanding claims anddismissing all litigation between them (“Settlement Agreement”); and

 

WHEREAS, each party desires to acquire licenses to patents of the otherparty on the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the aboveand the mutual covenants and promises hereinafter contained, the parties agreeas follows:

 

# **ARTICLE I –DEFINITIONS**

#  

As used in this Agreement, the following terms shall have the followingmeanings:

 

## 1.1                                 “Avistar Patents”means all Patents worldwide (i) that have a Priority Date on or before theend of the Capture Period (including those that have a Priority Date prior tothe Effective Date); and (ii) for which Avistar or any of its Subsidiarieshas as of the Effective Date, or obtains at any time during the term of thisAgreement, ownership or other right to grant licenses to Polycom or any of itsSubsidiaries of or within the scope granted herein without requiring payment ofroyalties or other incremental consideration by Avistar or any of itsSubsidiaries to a Third Party (except payments to Subsidiaries or to a ThirdParty for inventions made by such Third Party while 

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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## employed by Avistar or any of its Subsidiaries). The term “AvistarPatents” includes all Patents asserted against Polycom in the Litigation.

##  

## 1.2                                 “AvistarVOSTMProducts” means (i) Avistar’s networked architecture and videooperating system products, currently know as AvistarVOSTM, includingAvistarVOSTM Client and AvistarVOSTM Server; (ii) relatedproduct offerings of Avistar and its Subsidiaries, including applications runningon AvistarVOSTM; and (iii) [***] to the [***].

##  

## 1.3                                 “Capture Period”means any time on or prior to the fifth (5th) anniversary of theEffective Date.

##  

## 1.4                                 “Change of Control”means a transaction or series of related transactions (other than atransaction or series of related transactions effected solely for thepurposes of changing the form or jurisdiction of organization of anentity, or a pledge of assets pursuant to a credit agreement with an unrelatedbank, bank group or other financial institution) in which either (i) aparty consolidates or merges with or into another Person, or sells, assigns,conveys, transfers, leases or otherwise disposes of all or substantially all ofits assets, or any Person consolidates with, or merges with or into, a party,in each case unless the direct and indirect holders of aggregate Voting Powerof the party immediately prior to the transaction or series of relatedtransactions will hold, directly or indirectly, more than fifty percent (50%)of the aggregate Voting Power of the surviving or transferee Person immediatelyafter the transaction or series of related transactions; or (ii) anyPerson or “group” (as such term is used in Rule 13d-5 under the UnitedStates Securities Exchange Act of 1934) is or becomes, or has the right tobecome, the beneficial owner, directly or indirectly, of more than fiftypercent (50%) of the total aggregate Voting Power of a party. Notwithstandingthe foregoing, the purchase of stock of a party shall not constitute a Changeof Control to the extent that the purchase is by a financial investor who doesnot conduct, and does not have any Subsidiary that conducts and is not aSubsidiary of any Person that conducts, any manufacture, development,distribution, support or marketing of any video, communications or networkingproducts; provided, however, that the licenses granted hereunder to or by theacquired party shall not extend to or from either the financial investor (orany Person owned by the financial investor that is used to acquire the acquiredparty) or any of its Subsidiaries other than the acquired party and theSubsidiaries of such acquired party.

##  

## 1.5                                 “Economic Interest”means rights of a party to receive, directly or indirectly, a share of theprofits of a Subsidiary associated with securities or other equity or ownershipinterest in such Subsidiary (including, for example, rights to receivedividends and other profit distributions), whether or not actually distributed.

##  

## 1.6                                 “Existing Products”means products that, as of a given date, either (i) have been madecommercially available by a given Person or its Subsidiary, (ii) are undersubstantial development by a given Person or any of its Subsidiaries as of thegiven date and are made commercially available within twelve (12) months afterthe given date; or (iii) are bug fixes or error corrections to productsdescribed in subsection (i) or (ii) above.

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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## 1.7                                 “[***]” means [***](regardless of [***] name) that are [***],[***], [***] or [***] of [***], orare [***] with [***] or [***] or [***] as [***], in all cases [***] and insubstantial [***] on [***] and/or technologies [***] or [***] by such party orits Subsidiaries other than [***] an [***] (as such term is defined in Section [***]below) as a result of a [***] of [***].

##  

## 1.8                                 “Licensed Products”means all current and future products of a party or any of its Subsidiaries(except as otherwise limited in Sections 2.5 and 2.6 below). Licensed Productsinclude all products of each party and its Subsidiaries accused of infringingAvistar Patents or Polycom Patents, as applicable, in the Litigation.

##  

## 1.9                                 “Patents” means(i) all classes or types of utility patents, including utility models,invention certificates, continuations, divisionals, continuations-in-part,reexaminations, reissues, extensions and renewals, in all countries of theworld; and (ii) all applications, and rights to inventions for whichapplications may be filed, for these classes or types of patents in allcountries of the world. For the avoidance of doubt, the term “Patents” does notinclude any design patents, copyrights, trademarks, mask work rights, or tradesecret rights (even if such trade secrets may have been patentable duringthe Capture Period).

##  

## 1.10                           “Person” shall meanan individual, trust, corporation, partnership, joint venture, limitedliability company, association, unincorporated organization or other legal orgovernmental entity, worldwide.

##  

## 1.11                           “Polycom Patents”means all Patents worldwide (i) that have a Priority Date on or before theend of the Capture Period (including those that have a Priority Date prior tothe Effective Date); and (ii) for which Polycom or any of its Subsidiarieshas as of the Effective Date, or obtains at any time during the term of thisAgreement, ownership or other right to grant licenses to Avistar or any of itsSubsidiaries of or within the scope granted herein without requiring payment ofroyalties or other incremental consideration by Polycom or any of itsSubsidiaries to a Third Party (except payments to a Subsidiary or to a ThirdParty for inventions made by such Third Party while employed by Polycom or anyof its Subsidiaries). The term “Polycom Patents” includes all Patents assertedagainst Avistar in the Litigation.

##  

## 1.12                           “Priority Date” meansthe earliest effective filing date to which any Patent is entitled as a basisfor priority in a particular country. By way of example, it is understood thatthe Priority Date for a United States patent is the earliest of (i) theactual filing date of the United States patent application which issued intosuch patent, (ii) the priority date under 35 U.S.C. § 119 for suchpatent, or (iii) the priority date under 35 U.S.C. § 120 for suchpatent.

##  

## 1.13                           “Related Patents”means, with respect to any Patent, any continuations, divisionals,continuations-in-part, parents, counterparts, reexaminations, reissues,extensions and renewals, in all countries of the world.

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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## 1.14                           “Subsidiary” means,with respect to a given party or Person (the “Parent”), any other Personwhere the Parent directly or indirectly owns or controls (i) more thanfifty percent (50%) of the aggregate Voting Power of such other Person, or (ii) incountries where the percentage ownership by a foreign Parent is limited by lawto no more than fifty percent (50%), the maximum percentage of the aggregateVoting Power permitted under applicable law, but in no event less than fortyfive percent (45%). A Person shall be deemed to be a Subsidiary under thisAgreement only so long as such ownership or control exists. Notwithstanding theforegoing, a Subsidiary of a party shall only be entitled to receive thebenefit of the licenses and covenants granted under this Agreement to itsParent so long as such party also has (and has not contractually or otherwiseforfeited) a percentage Economic Interest in such Subsidiary at least equal tothe minimum percentage of Voting Power required under (i) or (ii) above,as applicable (“Minimum Economic Interest”). It is understood that, withrespect to a Subsidiary, the Minimum Economic Interest is only required forpurposes of receiving the benefit of licenses and covenants granted under thisAgreement to its Parent and shall not be construed as restricting a Subsidiary’sobligation to grant licenses and covenants under this Agreement.

##  

## 1.15                           “Third Party” means aPerson other than a party to this Agreement or a Subsidiary of a party to thisAgreement.

##  

## 1.16                           “Voting Power” meansthe right to exercise voting power with respect to the election of directors orsimilar managing authority of a Person (whether through direct or indirectbeneficial ownership of shares or securities of such Person or otherwise).

##  

# **ARTICLE II–LICENSE GRANTS**

#  

## 2.1                                 Avistar License toPolycom. Subject to the limitations set forth in Sections 2.5 and 2.6,Avistar and its Subsidiaries hereby grant to Polycom and its Subsidiaries anon-exclusive, fully paid-up, worldwide license, under the Avistar Patents, tomake, have made, use, lease, sell (directly and indirectly through multipletiers of distribution), offer to sell and import Licensed Products and topractice any process, method or procedure. Without limiting the foregoing, andnotwithstanding anything to the contrary, Avistar covenants, on its own behalfand on behalf of its Subsidiaries, that it will not assert claims ofinfringement of any of the Avistar Patents against Polycom, its Subsidiaries,[***] of [***] ([***] or [***]),[***] ([***] or [***]),[***] ([***] or [***],including [***]) or [***] ([***] and [***]) with respect to any [***] of [***]or its [***] and/or [***] conferencing [***], including both [***] and [***],with [***] (whether from [***], its Subsidiaries or [***]) where such [***] (orits Subsidiaries’) [***] and/or [***] products are [***] for [***] in such [***].

##  

## 2.2                                 Polycom License toAvistar. Subject to the limitations set forth in Sections 2.5 and 2.6,Polycom and its Subsidiaries hereby grant to Avistar Communications and itsSubsidiaries (including CPI) a non-exclusive, fully paid-up, worldwide license,under the Polycom Patents to make, have made, use, lease, sell (directly andindirectly through multiple tiers of distribution), 

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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## offer to sell and import Licensed Products and to practice any process,method or procedure. Without limiting the foregoing, and notwithstandinganything to the contrary, Polycom covenants, on its own behalf and on behalf ofits Subsidiaries, that it will not assert claims of infringement of any of thePolycom Patents against Avistar, its Subsidiaries (including CPI), [***] of [***]([***] or [***]), [***] ([***] or [***]), [***] ([***] or [***], including[***]) or [***] ([***] or [***]) with respect to any [***] of [***] or its [***]and/or [***] conferencing [***], including both [***] and [***], with [***](whether from [***], its Subsidiaries or [***]) where such [***] (or Avistar’sSubsidiaries’) [***] and/or [***] products are [***] for [***] in such [***].

##  

## 2.3                                 Distribution ofSoftware Products. It is understood that Licensed Products that aresoftware may be distributed by providing a copy to a customer or VAR, OEMor other distributor and allowing the customer or VAR, OEM or other distributorto reproduce the software. The patent licenses set forth in Sections 2.1 and2.2 shall extend to such software products and may include modificationswhere the software products are reproduced and distributed in substantially thesame form as provided by the licensed party or its Subsidiary to therespective customer or VAR, OEM or other distributor, including modificationsfor installation, interoperability or integration with other software, systemsor environments.

##  

## 2.4                                 IndirectInfringement. During the term of this Agreement, each party and itsSubsidiaries covenant not to sue the other party and its Subsidiaries on anyclaim that the other party or any of its Subsidiaries contributorily infringesor induces infringement of any Avistar Patent or Polycom Patent, as applicable.Each party agrees that this Section 2.4 shall not be construed asproviding any rights or licenses to any Third Party.

##  

## 2.5                                 No Right to Act asa Foundry or Contract Manufacturer. The licenses set forth in Sections 2.1and 2.2 shall not include the right, under any Avistar Patents or PolycomPatents, to manufacture or have manufactured products as a foundry or contractmanufacturer for a Third Party based on designs provided by such Third Party.

##  

## 2.6                                 Have Made Rights;Covenant Regarding [***].

##  

### (a)                                  The “have made”rights under the licenses set forth in Sections 2.1 and 2.2 only apply when thedesigns, working drawings or specifications for the respective Licensed Productare owned or licensed and provided by a party or its Subsidiary and do notextend to “off the shelf” products of a Third Party supplier that are madegenerally available by such supplier to other Third Parties.

###  

### (b)                                 If either party or anyof its Subsidiaries [***] a [***] of a [***] for [***] as a [***] in a [***], [***]or [***] (the party’s or its Subsidiary’s [***] being a “[***]”) which [***] isa [***] of such party or any of its Subsidiaries (except with respect to the [***]as a [***] therein), then the other party and its Subsidiaries hereby agree notto assert any claim of infringement of any Avistar Patents or Polycom Patents,as applicable, against [***] such party or any of its Subsidiaries with respectto the [***], [***], [***], [***] and/or [***] of the respective [***] as a [***]in such [***];[***] any [***] ([***] or [***]), [***] ([***] or [***]) or [***]([***] or [***], 

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities and ExchangeCommission.

 

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### including [***]) or [***] ([***] and [***]) of such party or any of itsSubsidiaries with respect to the [***] for the [***], [***], [***] for [***]and/or [***] of the respective [***] as a [***] in such [***]. It is expresslyacknowledged and agreed that each party reserves the right to bring a suit forpatent infringement against the [***], including with respect to the [***] as a[***] of the [***], without restriction or limitation by this Section 2.6.

###  

## 2.7                                 Subsidiaries. Eachparty intends for this Agreement to extend to all of its Subsidiaries withrespect to the licenses granted by such party to the other party under thisAgreement. The parties agree that, to the extent they are not already bound,each party shall use best efforts to ensure that all such Subsidiaries arebound by the terms of this Agreement. If any Subsidiary of a party is not boundto this Agreement for any reason and makes an assertion of infringement thatwould be precluded by the releases, licenses and covenants hereunder if suchSubsidiary were bound, then such party shall indemnify and hold harmless theother party and its Subsidiaries and their resellers (direct and indirect),distributors (direct and indirect), customers (direct and indirect, includingOEM customers) and end users (direct and indirect) for any costs and expenses(including reasonable fees of attorneys and other professionals), liabilities,damages and losses resulting from such assertion of infringement.

##  

## 2.8                                 Non-Circumvention.

##  

### (a)                                  Each party agrees totake all steps that are reasonable and in good faith under the circumstances toensure that all Patents are licensed under this Agreement that are directed toinventions that are made by its and its Subsidiaries’ employees and/orindividual contractors.

###  

### (b)                                 Both partiesunderstand and acknowledge that there are circumstances in which a party couldreasonably agree in good faith with an independent Third Party that the partywould forgo rights to license and/or enforce Patents directed to inventionsdeveloped in conjunction with employees and/or contractors of or for such ThirdParty. For example, both parties understand that it could be reasonable underthe circumstances for a party to agree in good faith to forgo rights to licenseand/or enforce Patents directed to inventions that arise out of:  (i) bona fide joint development projectsbased in substantial part on the pre-existing technology of an independentThird Party; or (ii) bona fide joint development projects undertaken withthe significant assistance of the employees and/or contractors of anindependent Third Party.

###  

### (c)                                  If a party, in goodfaith, does not obtain the right to grant licenses and covenants under a Patentof the full scope set forth in this Agreement, then the releases, licenses andcovenants granted under such Patent shall be of the broadest scope that suchparty or any of its Subsidiaries has the right to grant.

###  

### (d)                                 If a Patent is subjectto payment obligations to a Third Party (other than to a Third Party forinventions made by such Third Party while employed by the respective party orany of its Subsidiaries) and would otherwise qualify as an Avistar Patent orPolycom Patent, as applicable, the other party shall have the right to includesuch Patent under the licenses and 

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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### covenants granted to such other party and its Subsidiaries under thisAgreement so long as such other party agrees in writing to, and actually does,make all payments required to be made to the Third Party as a result of suchlicenses and covenants and holds the granting party harmless with respect tosuch payment obligations.

###  

### (e)                                  If a party or any ofits Subsidiaries owns or has the right to enforce, or can control or cause theenforcement of, or has a financial interest in the enforcement of any Patentthat would qualify as a Avistar Patent or Polycom Patent, as applicable, ifowned by the respective party or any of its Subsidiaries, such party and itsSubsidiaries shall not take any action to enforce or permit or cause theenforcement of such Patent against the other party or any of its Subsidiarieswithin the scope of the licenses and covenants set forth in this Agreement.

###  

### (f)                                    If a party or anyof its Subsidiaries is entitled to receive any share of money damages and/orroyalties for a Patent owned solely or jointly by a Third Party and cannotprevent the independent enforcement of such Patent by the Third Partynotwithstanding compliance with its obligations under subsection (a) and(e) above, then such party and its Subsidiaries shall reimburse the otherparty and its Subsidiaries for any such amounts which it is entitled to receiveand actually receives if such Patent is enforced against such other party orits respective Subsidiary.

###  

## 2.9                                 No Other Rights.No rights or licenses are granted under any Patents except as expresslyprovided herein, whether by implication, estoppel or otherwise. Withoutlimiting the foregoing sentence, (i) no right to grant sublicenses isgranted under the licenses set forth this Agreement; (ii) except asexpressly set forth in Section [***], no license is granted, eitherdirectly or by implication, estoppel or otherwise, to any Third Party for thecombination of any Licensed Products purchased from a party or its Subsidiarywith any other items that are not Licensed Products; and (iii) no right orlicense is granted under any design patent, copyrights, trademarks, mask workrights, or trade secret rights of either party or any of its Subsidiaries.

##  

2.10                           Negationof Avistar Patent Warranties. With respect to the licenses granted byAvistar to Polycom and its Subsidiaries pursuant to this Article II,nothing in this Agreement shall be construed (i) as a warranty orrepresentation by Avistar as to the validity or scope of the Avistar Patents; (ii) asa warranty or representation that anything made, used, sold, imported orotherwise disposed of under the license granted by Avistar is or will be freefrom infringement of the Patents, copyrights, trade secrets, trademarks orother rights of any Third Parties; (iii) as granting by implication,estoppel or otherwise any licenses or rights under Patents or otherintellectual property rights of Avistar other than as express granted in this Article II,regardless of whether such Patents are dominant or subordinate to the AvistarPatents; or (iv) (a) to require Avistar to file any Patentapplication, (b) a warranty that Avistar will be successful in securingthe grant of any Patent or reissue or extensions thereof, or (c) torequire Avistar to pay any maintenance fees or take any other stapes tomaintain the Avistar Patents. Avistar does not assume any responsibility forthe manufacture or use of any product manufactured or sold under the licensegranted in Section 2.1. All warranties in connection with such productsshall be made exclusively by Polycom or its Subsidiaries as the manufacturersor sellers of such products.

 

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[***]  Portionsof this exhibit have been omitted pursuant to a request for confidentialtreatment filed pursuant to Rule 24b-2 promulgated under the SecuritiesExchange Act of 1934, as amended, and the omitted portions represented by [***]have been separately filed with the Securities and Exchange Commission.

 

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2.11                           Negationof Polycom Patent Warranties. With respect to the licenses granted byPolycom and its Subsidiaries to Avistar pursuant to this Article II, nothingin this Agreement shall be construed (i) as a warranty or representationby Polycom or its Subsidiaries as to the validity or scope of the PolycomPatents; (ii) as a warranty or representation that anything made, used,sold, imported or otherwise disposed of under the license granted by Polycom orits Subsidiaries is or will be free from infringement of the Patents,copyrights, trade secrets, trademarks or other rights of any Third Parties; (iii) asgranting by implication, estoppel or otherwise any licenses or rights underpatents or other intellectual property rights of Polycom or its Subsidiariesother than as express granted in this Article II, regardless of whethersuch Patents are dominant or subordinate to the Polycom Patents; or (iv) (a) torequire Polycom or its Subsidiaries to file any Patent application, (b) awarranty that Polycom or its Subsidiaries will be successful in securing thegrant of any Patent or reissue or extensions thereof, or (c) to requirePolycom or its Subsidiaries to pay any maintenance fees or take any otherstapes to maintain the Polycom Patents. Polycom and its Subsidiaries do notassume any responsibility for the manufacture or use of any productmanufactured or sold under the license granted in Section 2.2. All warrantiesin connection with such products shall be made exclusively by Avistar as themanufacturer or seller of such products.

 

# **ARTICLE III– TERM AND TERMINATION**

#  

## 3.1                                 Term. The termof this Agreement shall commence upon the Effective Date and shall continue untilthe expiration of the last to expire of the Polycom Patents and Avistar Patents.All licenses and covenants granted under this Agreement are irrevocable andnon-terminable (except to the extent such licenses may be limited asexpressly set forth in Article IV or Section 6.7).

##  

# **ARTICLE IV–CHANGE OF CONTROL AND SUBSIDIARIES**

#  

## 4.1                                 Change of Control.In the event of a Change of Control of either Polycom or Avistar:

##  

### (a)                                  The Licensed Productsof the party subject to the Change of Control (“Acquired Party”) shallbe limited to Existing Products of the Acquired Party and its Subsidiaries atthe time of the Change of Control and [***] thereto. The licenses granted underthis Agreement shall not apply to Existing Products of (i) any Third Partyinvolved in such Change of Control or any of its Subsidiaries (collectively,the “Acquirer”) at the time of the Change of Control or any [***]thereto, or (ii) any Person that is acquired by the Acquirer or any of itsSubsidiaries subsequent to the Change of Control, including any Person acquiredby the Acquired Party subsequent to the Change of Control. The LicensedProducts of the non-Acquired Party shall not be limited as a result of theChange of Control.

###  

### (b)                                 The licenses andcovenants granted by each of the parties under this Agreement shall be limitedsolely to those Patents owned or licensable by each party and its 

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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### Subsidiaries prior to the date of the Change of Control and shall notextend to any Patents of the Acquirer. If the Capture Period has not alreadyended, the Capture Period (as applicable to both parties) shall be shortened toterminate as of the effective date of the Change of Control.

###  

### (c)                                  A subsequent Changeof Control of the Acquired Party shall not be construed as further limiting orexpanding the licenses granted to the Acquired Party. In such event, theLicensed Products of the Acquired Party shall remain limited to the ExistingProducts of the Acquired Party and its Subsidiaries at the time of the initialChange of Control and [***] thereto as described in Section 4.1(a) above.

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## 4.2                                 Subsidiaries.

##  

### (a)                                  New Subsidiaries.If a Person becomes a Subsidiary of a party after the Effective Date, then: (x)such Subsidiary shall be granted the licenses and covenants set forth in thisAgreement; and (y) the Patents of such Subsidiary shall be subject to thelicenses and covenants granted to the other party and its Subsidiaries underthis Agreement. In addition, if the other party is not Actively Engaged (asdefined below) with such Person regarding infringement of Avistar Patents orPolycom Patents, as the case may be, at the time such Person enters into adefinitive agreement to become a Subsidiary of a party, then: (a) suchSubsidiary shall be released from any liability for past infringement ofAvistar Patents or Polycom Patents, as applicable, within the scope of thelicenses and covenants granted in this Agreement ; and (b) the other partyand its Subsidiaries shall be released from any liability for past infringementof the Patents of such Subsidiary within the scope of the licenses andcovenants granted in this Agreement. As used above, “Actively Engaged” meansthat the other party (i) has sued and served a complaint upon therespective Person for infringement of Avistar Patents or Polycom Patents, asapplicable, and such suit remains pending; or (ii) has provided writtennotice of patent infringement of Avistar Patents or Polycom Patents, as applicable,to the respective Person and is actively engaged in negotiations to grant aroyalty-bearing license to the respective Person for such Avistar Patents orPolycom Patents, as applicable, including the exchange, by both sides, of definitiveterms for the respective agreement.

###  

### (b)                                 Former Subsidiaries.Except as otherwise expressly set forth in Section 4.4 below, if a Person(including CPI if it ceases to qualify as a Subsidiary of AvistarCommunications) ceases to qualify as a Subsidiary of a party (“FormerSubsidiary”), then:

###  

#### (i)             the licenses and covenants granted to theFormer Subsidiary shall terminate on the date the Former Subsidiary ceases tobe a Subsidiary under this Agreement; and

####  

#### (ii)          The licenses and covenants granted hereunderto the other party and its Subsidiaries with respect to Patents of the FormerSubsidiary shall continue until the expiration of each such Patents, includingPatents based on applications filed prior to the date it ceased to be aSubsidiary under this Agreement and Related Patents; provided, however, thatsuch licenses and covenants shall not extend to Patents of the FormerSubsidiary where the Former Subsidiary first acquires rights to such Patentsafter the date it ceases to be a Subsidiary under this Agreement.

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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## 4.3                                 Divestiture ofBusiness or Assets. Except as otherwise expressly set forth in Section 4.4below:

##  

### (a)                                  If a party or any ofits Subsidiaries spins out or transfers a portion of its business or assetssuch that the spun-out or transferred business or assets are no longer part ofa party or any of its Subsidiaries under this Agreement, then the licenses andcovenants granted to such party under this Agreement shall not extend to suchbusiness (or with respect to the products manufactured, distributed, imported,marketed, leased, sold or used by such business) or assets after the spin outor transfer.

###  

### (b)                                 If a party or any ofits Subsidiaries assigns or transfers any Avistar Patents or Polycom Patents,as applicable, the licenses and covenants granted to the other party and itsSubsidiaries with respect to those Patents shall remain in effect, and thetransferring party or Subsidiary shall enter into a written agreement with thetransferee making any such assignment or transfer expressly subject to thelicenses and covenants set forth in this Agreement.

###  

## 4.4                                 [***] of Material [***].

##  

### (a)                                  If a party or any ofits Subsidiaries [***][***] or [***] of the [***] or [***] of a [***] (asdefined below) to a [***] (“[***]”) for a [***] of at [***][***] [***] ([***])(whether [***],[***] or other [***] of [***]), then the [***] under [***] shall[***] to apply to the [***] of the [***] as of that date of [***] of such [***]that are [***] to the [***] notwithstanding such [***].

###  

### (b)                                 As used in this Section 4.4,a “[***]” means a material and substantial [***] of a [***] that has, amongother things, all of the following: (i) all of the [***] for one or more [***],including at least [***] of [***]; (ii) [***] who [***] such [***]; (iii) [***]or other [***] relating to such [***]; and (iii) [***] related to such [***].As used herein, a [***] involving a “[***]” as described herein may be an [***]or may be by [***] of a [***], in which event the provisions of this Section 4.4shall apply, rather than the provisions of Section [***] and [***] above.

###  

# **ARTICLE V–AvistarVOS**TM**PRODUCTS**

#  

## 5.1                                 Most Favored Rights.Polycom shall have the right, but not the obligation, to purchase AvistarVOSTMProducts at a price, and on terms and conditions, that are no less favorablethan those that Avistar or any of its Subsidiaries makes available to any othercustomer of the AvistarVOSTM Products purchasing the AvistarVOSTMproducts.

##  

## 5.2                                 Audit. Avistarand its Subsidiaries agree to keep full, clear and accurate records to documentand confirm compliance with its obligations under Section 5.1. Upon itspurchase of AvistarVOSTM Products or request for a quote under whichit may purchase AvistarVOSTM Products, Polycom shall have theright to have an independent auditor inspect and audit such records duringregular business hours to confirm Avistar’s and its Subsidiaries’ compliancewith Section 5.1. In no event shall such audit be held more than one timein a calendar year during, 

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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## unless an audit uncovers a material non-compliance. Polycom shall bearits own costs for such audit, unless the audit uncovers a materialnon-compliance, in which case Avistar shall reimburse Polycom for the costs ofsuch audit.

##  

# **ARTICLE VI–MISCELLANEOUS PROVISIONS**

#  

## 6.1                                 Representations andWarranties.

##  

### (a)                                  Each of the partieshereto represents and warrants that it has the right to grant the licenses andcovenants granted by such party under this Agreement.

###  

### (b)                                 Polycom represents andwarrants that (i) Polycom owns the Patents asserted against Avistar in theLitigation, and any Related Patents thereto, and has the right to grantlicenses and covenants with respect to such Patents of the full scope set forthherein; (ii) no payment of consideration to any Third Party is requiredfor the licenses granted with respect to Patents owned by Polycom or any of itsSubsidiaries as of the Effective Date; (iii) neither Polycom nor any ofits Subsidiaries has any parent, affiliate or joint venture (other than Polycomor its Subsidiaries under this Agreement) who owns or controls any Patents asof the Effective Date); and (iv) neither Polycom nor any of itsSubsidiaries has assigned or otherwise transferred its rights to any Patents inthe one (1) year period prior to the Effective Date which would otherwisequalify as Polycom Patents in the absence of such assignment or transfer.

###  

### (c)                                  Avistar representsand warrants that (i) Avistar owns the Patents asserted against Polycom inthe Litigation, and any Related Patents thereto, and has the right to grantlicenses and covenants with respect to such Patents of the full scope set forthherein; (ii) no payment of consideration to any Third Party is requiredfor the licenses granted with respect to Patents owned by Avistar or any of itsSubsidiaries as of the Effective Date; (iii) neither Avistar nor any ofits Subsidiaries has any parent, affiliate or joint venture (other than Avistaror its Subsidiaries under this Agreement) who owns or controls any Patents asof the Effective Date); and (iv) neither Avistar nor its Subsidiaries hasassigned or otherwise transferred its rights to any Patents in the one (1) yearperiod prior to the Effective Date which would otherwise qualify as AvistarPatents in the absence of such assignment or transfer.

###  

## 6.2                                 Confidentiality ofTerms. Neither party shall disclose the terms of this Agreement without theprior written consent of the other party except:

##  

### (a)                                        to Subsidiariesof the parties in confidence;

###  

### (b)                                       to anygovernmental body having jurisdiction and specifically requiring suchdisclosure (in confidence to the extent allowed);

###  

### (c)                                        in response toa valid subpoena or as otherwise may be required by law (in confidence tothe extent allowed);

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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### (d)                                       to the extentrequired, for the purposes of disclosure in connection with the SecuritiesExchange Act of 1934, as amended, the Securities Act of 1933, as amended, andany other reports filed with the Securities and Exchange Commission, or anyother filings, reports or disclosures that may be required underapplicable laws or regulations, provided however, that in the event eitherparty determines it is necessary to disclose any terms beyond those included inthe press releases attached as Exhibit B to the Settlement Agreement orthat it is required to publicly file this Agreement or the SettlementAgreement, the disclosing party agrees to use commercially reasonable effortsto receive confidential treatment for information deemed sensitive and shallgive the other party reasonable prior notice of its intention to disclose suchinformation;

###  

### (e)                                        to a party’saccountants, legal counsel and other financial and legal advisors, subject toobligations of confidentiality;

###  

(f)                                          as requiredduring the course of litigation, subject to protective orders or other similarprotections as applicable; or

 

(g)                                       to a [***] in connectionwith a [***] or [***], of or with [***] provided that such disclosure shall be (i) ona strictly limited, need-to-know basis, (ii) when such [***] is [***] to[***], and (iii) on terms applicable to the most confidential informationdisclosed by such party in connection with such [***] provided such terms areat least as restrictive as set forth herein;

 

provided, however, that prior to any suchdisclosure pursuant to paragraphs (c) and/or (f) hereof, the partyseeking to make such disclosure shall notify the other party and takereasonable actions in an effort to minimize the nature and extent of suchdisclosure.

 

## 6.3                                 Notices. Allnotices required or permitted to be given hereunder shall be in writing andshall be delivered by hand, or if dispatched by prepaid air courier or byregistered or certified airmail, postage prepaid, addressed as follows:

##  

| If to Avistar:  |   | Avistar Communications Corporation |
|-----------------|--------|------------------------------------|
|            |   | Attn: Chief Financial Officer      |
|            |   | 555 Twin Dolphin Drive             |
|            |   | Suite 360                     |
|            |   | Redwood Shores, California 94065   |
|            |   |                               |
| If to Polycom:  |   | Polycom, Inc.                 |
|            |   | General Counsel                    |
|            |   | 4750 Willow Road                   |
|            |   | Pleasanton, CA 94588               |
|            |   |                               |
| with a copy to: |   | Polycom, Inc.                 |
|            |   | Attn: Chief Financial Officer      |
|            |   | 4750 Willow Road                   |
|            |   | Pleasanton, CA 94588               |

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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Such notices shall be deemed to have been served when received byaddressee or, if delivery is not accomplished by reason of some fault of theaddressee, when tendered for delivery. Either party may give writtennotice of a change of address and, after notice of such change has beenreceived, any notice or request shall thereafter be given to such party asabove provided at such changed address.

 

## 6.4                                 Assignment. Neitherparty may assign this Agreement or any right or obligation under thisAgreement without the prior written consent of the other party, except (i) aspart of a Change of Control transaction as defined in subsection 1.4(i) above,in which event the licensed rights granted to such party hereunder shall belimited by the provisions set forth in Section 4.1 above; or (ii) as part ofthe transfer of all or substantially all of the business or assets of a party(whether by sale, merger, operation of law or otherwise) in a transaction thatis not a Change of Control, solely because the direct and indirect holders ofaggregate Voting Power of the party immediately prior to the transaction or series ofrelated transactions will hold, directly or indirectly, more than fifty percent(50%) of the aggregate Voting Power of the surviving or transferee Personimmediately after the transaction or series of related transactions. Anyassignment made in contravention of the foregoing sentence shall be *void ab initio*and of no force or effect*.*Subject to the foregoing, this Agreementshall be binding upon and inure to the benefit of the parties and theirpermitted successors and assigns.

##  

## 6.5                                 Governing Law. ThisAgreement and matters connected with the performance thereof shall beconstrued, interpreted, applied and governed in all respects in accordance withthe laws of the United States of America and the State of California, withoutreference to conflict of laws principles.

##  

## 6.6                                 Dispute Resolution.If a dispute arises regarding this Agreement, or the interpretation, breach,termination or validity thereof, the senior management of both parties shallmeet to attempt to resolve such disputes. If the senior management cannotresolve the dispute, the parties agree to meet for one (1) day with animpartial mediator to attempt to resolve such dispute. If the dispute is notresolved by such mediation, then the parties agree that such dispute shall beresolved by binding arbitration in San Francisco, California before three (3) arbitratorsin accordance with the rules of the International Chamber of Commerce (“ICC”)in effect as of the Effective Date of this Agreement. The parties, theirrepresentatives, other participants and arbitrators shall hold the existence,content and result of arbitration in confidence, except as otherwise requiredor advisable in connection with securities filings or otherwise required by law.The award of the arbitrators may be entered in any court having jurisdictionthereof. ThisSection 6.6 shall not be construed as restricting or limiting either party’sability to immediately assert a license or other defense in any litigation orother proceeding against such party, such party’s Subsidiaries, or its or theirproducts or the resellers, distributors or customers of such products,regardless of jurisdiction or venue.

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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## 6.7                                 Bankruptcy. Eachparty acknowledges that all rights and licenses granted by it under or pursuantto this Agreement are, and shall otherwise be deemed to be, for purposes of Section 365(n)of the United States Bankruptcy Code (the “Bankruptcy Code”), licensesof rights to “intellectual property” as defined under Section 101(56) ofthe Bankruptcy Code. Each party acknowledges that if such party, as a debtor inpossession or a trustee-in-bankruptcy in a case under the Bankruptcy Code,rejects this Agreement, the other party may elect to retain its rightsunder this Agreement as provided in Section 365(n) of the Bankruptcy Code.Each party irrevocably waives all arguments and defenses arising under 11U.S.C. 365(c)(1) or successor provisions to the effect that applicable lawexcuses the party, other than the debtor, from accepting performance from orrendering performance to an entity other than the debtor or debtor inpossession as a basis for opposing assumption of the Agreements by the otherparty in a case under Chapter 11 of the Bankruptcy Code to the extent thatsuch consent is required under 11 U.S.C. § 365(c)(1) or any successorstatute; provided, however, that the debtor in possession, ortrustee-in-bankruptcy agrees in writing that any Change of Control (whetherresulting from such bankruptcy proceeding or otherwise) shall remain subject toArticle IV above. In the event that a party liquidates, winds up orotherwise ceases to conduct business in the ordinary course, then the licensesgranted to such party under this Agreement shall terminate and the licensesgranted to the other party shall remain in effect without limitation.

##  

## 6.8                                 Severability. Ifany provision of this Agreement is held to be illegal or unenforceable, suchprovision shall be limited or eliminated to the minimum extent necessary sothat the remainder of this Agreement will continue in full force and effect andbe enforceable. The parties agree to negotiate in good faith an enforceablesubstitute provision for any invalid or unenforceable provision that mostnearly achieves the intent of such provision.

##  

## 6.9                                 Entire Agreement.This Agreement, together with the Settlement Agreement, collectively embody theentire understanding of the parties with respect to the subject matter hereof,and merge all prior discussions between them, and neither of the parties shallbe bound by any conditions, definitions, warranties, understandings, orrepresentations with respect to the subject matter hereof other than asexpressly provided herein. No oral explanation or oral information by either partyhereto shall alter the meaning or interpretation of this Agreement.

##  

## 6.10                           Modification; Waiver.No modification or amendment to this Agreement, nor any waiver of any rights,will be effective unless assented to in writing by the party to be charged, andthe waiver of any breach or default will not constitute a waiver of any otherright hereunder or any subsequent breach or default.

##  

## 6.11                           Construction. Any rule ofconstruction to the effect that ambiguities are to be resolved against thedrafting party will not be applied in the construction or interpretation ofthis Agreement. As used in this Agreement, the words “include” and “including,”and variations thereof, will not be deemed to be terms of limitation, butrather will be deemed to be followed by the words “without limitation.”  The headings in this Agreement will not bereferred to in connection with the construction or interpretation of thisAgreement.

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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## 6.12                           Counterparts. ThisAgreement may be executed in counterparts or duplicate originals, both ofwhich shall be regarded as one and the same instrument, and which shall be theofficial and governing version in the interpretation of this Agreement. ThisAgreement may be executed by facsimile signatures and such signaturesshall be deemed to bind each party as if they were original signatures.

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to besigned below by their respective duly authorized officers.

 

 
| **Avistar Communications Corporation**  |                                          | **Polycom, Inc.** |   |
|-----------------------------------------|-----------------------------------------------|------------------------|--------|
| ** **                              |                                          |                   |   |   |
| ** **                              |                                          |                   |   |   |
| By:                                     | /s/ William L. Campbell                       |                   | By:    | /s/ Michael R. Kourney |   |
|                                    |                                          |                   |   |   |   |
| Name:                                   | William L. Campbell                           |                   | Name:  | Michael R. Kourney |   |
|                                    |                                          |                   |   |   |   |
| Title:                                  | Vice Chairman & Chief Admin  Officer |                   | Title: | Chief Financial Officer |   |
|                                    |                                          |                   |   |   |   |
| Date:                                   | November 12, 2004                        |                   | Date:  | November 12, 2004 |   |
|                                    |                                          |                   |   |   |   |
| ** **                              |                                          |                   |   |   |
| **Collaboration Properties, Inc.** |                                          |                   |   |   |
| ** **                              |                                          |                   |   |   |
|                                    |                                          |                   |   |   |   |
| By:                                     | /s/ William L. Campbell                       |                   |   |   |   |
|                                    |                                          |                   |   |   |   |
| Name:                                   | William L. Campbell                           |                   |   |   |   |
|                                    |                                          |                   |   |   |   |
| Title:                                  | President and Chief Executive Officer         |                   |   |   |   |
|                                    |                                          |                   |   |   |   |
| Date:                                   | November 12, 2004                        |                   |   |   |   |

 

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[***] Portions of this exhibit have been omitted pursuant to a requestfor confidential treatment filed pursuant to Rule 24b-2 promulgated underthe Securities Exchange Act of 1934, as amended, and the omitted portionsrepresented by [***] have been separately filed with the Securities andExchange Commission.

 

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