exhibit_1023.htm


    License
Reference Number________________

    


    


    PATENT LICENSE AGREEMENT
(“Agreement”) dated as of the Agreement Date, hereinbelow defined, and between
INTERNATIONAL BUSINESS MACHINES CORPORATION, a New York corporation (“IBM”), and
AVISTAR COMMUNICATIONS CORPORATION, a  Delaware corporation
(“AVS”).

    


    WHEREAS, IBM and Avistar are
concurrently entering into a Licensed Works Agreement, Agreement #
4908004013 of
September 2008 (“Base Agreement”), and a Statement of Work SOW# 4908004020 of
September 2008 (“SOW”); and

    


    WHEREAS,
for the consideration specifically set forth in such agreements specifically
referred to below, AVS wishes to grant to IBM, and IBM wishes to receive, a
license under AVS’ patents as set forth below;

    


    NOW,
THEREFORE, in consideration of the premises and mutual covenants herein
contained, IBM and AVS agree as follows:

    


    


    Section
1.                                           Definitions

    


     “Subsidiary”
or “Subsidiaries” shall mean a corporation, company or other
entity:

    (a)           more
than fifty percent (50%) of whose outstanding shares or securities (representing
the right to vote for the election of directors or other managing authority)
are, now or hereafter, owned or controlled, directly or indirectly, by a party
hereto, but such corporation, company or other entity shall be deemed to be
a Subsidiary only so long as such ownership or control exists;
or

    (b)           which
does not have outstanding shares or securities, as may be the case in a
partnership, joint venture or unincorporated association, but more than fifty
percent (50%) of whose ownership interest representing the right to make the
decisions for such corporation, company or other entity is now or hereafter,
owned or controlled, directly or indirectly, by a party hereto, but such
corporation, company or other entity shall be deemed to be a Subsidiary
only so long as such ownership or control exists..

    


    “Agreement
Date” shall mean the date on which this Agreement is signed by the second of IBM
and AVS to so sign, as shown on the signature page.

    


    “Authorized
Copy (Copies)” shall mean a computer program copied by authorized third party
recipients of a Master Copy.

    


    “Distribute”
shall mean import, have imported, lease, license, sell, offer for sale, or
otherwise transfer.

    


    “Licensed
Products” shall mean Information Handling System(s) or any instrumentality or
aggregate of instrumentalities (including, without limitation, any component,
subassembly, computer program or supply) designed for incorporation in an
Information Handling System.    “Information Handling
System(s)” shall mean any instrumentality or aggregate of instrumentalities
primarily designed to compute, classify, process, transmit, receive, retrieve,
originate, switch, store, display, manifest, measure, detect, record, reproduce,
handle or utilize any form of information, intelligence or data for business,
scientific, control or other purposes.


    
      
        
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    “Licensed
Patents” shall mean all patents throughout the world, ***:

    
      	
              (a)

            	
              issued
      or issuing on patent applications entitled to an effective filing date
      prior to five years after the Agreement Date;
  and

            


    

    
      	
              (b)

            	
              under
      which patents or the applications therefor (including continuations,
      divisionals, or continuations-in-part) AVS or any of its Subsidiaries has
      as of the Agreement Date, or thereafter obtains, the right to grant
      licenses to IBM of or within the scope granted herein without such grant
      resulting in payment of royalties or other consideration by AVS or its
      Subsidiaries to third parties (except for payments among AVS and its
      Subsidiaries, and payments to third parties for inventions made by
      said third parties while employed by AVS or any of its
      Subsidiaries).  AVS represents on behalf of itself and its
      Subsidiaries that as of the Agreement Date no grants under any of its
      patents or applications therefor are subject to such third party
      consideration.  On request by IBM, AVS agrees to inform IBM of
      any such patents or applications, and IBM shall have the right to provide
      such consideration to such third party so as to obtain a license
      thereunder.

            


    

    


    Notwithstanding
the foregoing, Licensed Patents shall include the patents identified in Schedule
A, and all reissues, reexaminations, continuations, divisionals,
continuations-in-part, and foreign counterparts thereof throughout the
world.

    


    “Master
Copy” shall mean a Licensed Product in software form that is Distributed by or
for IBM to a third party with written authorization directly or indirectly from
IBM to such third party to make copies of such Licensed Product for its own use
or for further authorized Distribution (by transmission or other distribution
means).

    


    “Performance
of Business Processes” shall mean advising, servicing, or operating all or part
of an enterprise or organization.

    


    


    Section
2.                                           Grant of
Rights

    


    2.1           AVS,
on behalf of itself and its Subsidiaries grants to IBM a nonexclusive and
worldwide license under the Licensed Patents:

    
      	
              (a)

            	
              to
      make (including the right to use any apparatus and practice any method in
      making), use, and Distribute Licensed Products and Master
      Copies;

            


    

    
      	
              (b)

            	
              to
      authorize in writing, directly or indirectly, recipients of Master Copies
      to make and Distribute Authorized
Copies;

            


    

    
      	
              (c)

            	
              to
      have Licensed Products made by another manufacturer for use and
      Distribution by or for IBM, provided that a substantial portion of the
      design, specifications, or other content of such Licensed Products is
      provided to such manufacturer by IBM, an IBM Subsidiary, or a third party
      providing such content for and on behalf of IBM or an IBM Subsidiary and
      where such content is owned by or licensed to IBM or an IBM Subsidiary;
      and

            


    

    
      	
              (d)

            	
              to
      use any apparatus and practice any method in connection with the
      Performance of Business Processes for itself or third
    parties.

            


    

    


    2.2           IBM
shall have the right to grant sublicenses to its Subsidiaries existing on or
after the Agreement Date, which sublicenses may include the right of such
sublicensed Subsidiaries to sublicense other IBM Subsidiaries.  No
sublicense shall be broader in any respect at any time during the life of this
Agreement than the license held at that time by the party that granted the
sublicense.


    
      
        
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    2.3           Where
a third party uses an apparatus or practices a method in Performance of Business
Process, and such third party is acting on behalf of, and as subcontractor to,
IBM in connection with a contract that obligates IBM to provide such Performance
of a Business Process for an IBM customer, such use or practice shall be
deemed to have been performed by IBM.

    


    2.4           AVS
irrevocably releases IBM, its Subsidiaries existing as of the Agreement Date,
and their respective customers, distributors and suppliers from any and all
claims of infringement of the Licensed Patents which claims are based on acts
prior to the Agreement Date, which, had they been performed after the Agreement
Date would have been licensed under this Agreement.

    


    2.5           AVS
covenants not to sue direct and indirect customers of Licensed Products under
this Agreement under the Licensed Patents for the formation of any combination
of such Licensed Products with other products, and for the use or sale of such
combinations that have been formed by said customers, notwithstanding that
such other products are not furnished by IBM or its Subsidiaries; provided,
however, that such covenant not to sue shall only extend to patent claims with
respect to which IBM’s or its Subsidiary’s furnishing of such Licensed Products
would, in the absence of this Agreement, constitute infringement and provided,
further that such covenant shall not extend to infringement arising from the
manufacture, use or sale of such other product per se.

    


    2.6           If,
after the Agreement Date, IBM or any of its Subsidiaries  (“Acquiring
Party”) either acquires an entity or acquires substantially all of the assets of
an entity (“Acquired Party”), and said Acquired Party is, as of the date of
acquisition, licensed by AVS or its Subsidiaries under the Licensed Patents,
through an existing agreement dated after the Agreement Date pursuant to which
payments are to be made by said entity to AVS, then, at IBM’s election, IBM may
terminate such existing license by providing notice to that effect to
AVS.  In the event IBM does so terminate such existing license, any
payments that may be due after such notice shall be deemed fully satisfied such
that neither IBM nor said entity shall have any further payment obligation under
such existing agreement.  In the case where such existing agreement is
dated before the Agreement Date, IBM’s right of termination shall only apply if
such existing agreement includes obligations to pay a royalty for licensed
products after the date of acquisition; in the case where such existing
agreement is dated before the Agreement Date and includes obligations to make
fixed fee payments after the date of acquisition, IBM shall not have any right
to terminate afforded by this Agreement, and IBM may request that the parties
discuss potential changes to the amount or duration of such fixed fee
payments.

    


    


    Section
3.                                           Miscellaneous

    


    3.1           In
consideration for the licenses set forth in this Agreement, IBM shall pay AVS
the fees and royalties set forth in Sections 11.1-11.3 of the SOW.

    


    3.2           The
term of the licenses granted under this Agreement shall be from the Agreement
Date until the last to expire of the Licensed Patents.  This Agreement
may be terminated for cause by AVS only if (a) IBM has failed to make payment of
the fees and royalties set forth in Sections 11.1-11.3 of the SOW, and (b) IBM
has failed to make such payments within *** days after notification
from AVS that such payments are past due, and (c) IBM has no credible
basis


    
      
        
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    to not
make such payments (by way of illustration, if IBM has a credible basis to
believe that AVS has failed to meet the technology milestones set forth in the
SOW, and does not make the payment that was due for such milestone completion,
this Agreement shall not be terminable by AVS; rather, if AVS disagrees and
believes the milestone was met, it shall have the right to sue for payment of
such amounts).  The parties agree that they shall have their senior
executive management meet to discuss any disagreement regarding payments prior
to initiating any legal action.

    


    ***.

    


    3.3           Neither
AVS nor its Subsidiaries shall assign or grant any right under any of the
Licensed Patents unless such assignment or grant is made subject to the terms of
this Agreement.  IBM shall have the right to assign this license to a
successor of all of IBM’s businesses to which this Agreement
relates.

    


    If,
subsequent to the Agreement Date,

    (a) IBM
either transfers a product or service line to a third party without transferring
a Subsidiary to said third party; or spins off a Subsidiary (either by disposing
of it to a third party or in some other manner reducing ownership or control so
that the spun-off entity is no longer a Subsidiary of the Transferring Party);
and if

    (b) such
transfer or spin off includes at least one marketable product or service in a
product or service line and tangible assets having a net value ***,

    then
after written request (within sixty (60) days following the transfer or spin
off) to AVS jointly by IBM and either such third party in the case of a
transfer, or such ex-Subsidiary in the case of a spin off, AVS shall grant a
royalty-free license (under the same terms as the license granted to IBM herein
but excluding this provision and Sections 2.4 and 3.1) under its Licensed
Patents for the field of such product or service line to such third party or
such ex-Subsidiary, (the “Recipient”) provided that:

    (i)           such
field shall not be defined more broadly than necessary to cover the particular
product or service line being transferred or spun off, including extensions
thereto based on the same technology;

    (ii)           the
license granted shall be limited in the twelve (12) months immediately following
such transfer or spin off to a volume of licensed products or services having an
aggregate selling price equal to no more than the aggregate selling prices of
such products or services by said Transferring Party in the twelve (12) months
preceding such transfer or spin off plus ten percent (10%); and shall be
limited, in each of the successive twelve-month periods following such transfer
or spin off, to a volume of licensed products or services having an aggregate
selling price equal to no more than the limit for the immediately preceding
twelve-month period plus ten percent (10).

    


    ***.

    


    3.4           The
parties shall mutually agree on the content and timing of a press release
describing the existence of this Agreement in accordance with Section 16.1 of
the SOW; other than the foregoing, neither party shall disclose any term or
condition of this Agreement to any third party except (a) to the extent
disclosure is required by court order,  otherwise required by law or
regulatory obligation, provided the disclosing party first give the other party
prior written notice to enable the other party to seek a protective order; (b)
to the extent required to enforce rights under this Agreement; or (c) to the
extent reasonably necessary, on a confidential basis, to  the
disclosing party’s accountants, attorneys and / or financial
advisors.  In addition, in response to a request by a customer, IBM
and AVS shall have the right to disclose the existence of this


    
      
        
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treatm ent request that has been filed separately with the Securities and
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    Agreement
and the scope of its rights to that customer, on a confidential basis and AVS
may identify IBM as a licensee of the AVS Licensed Patents to potential
licensees.

    


    3.5           AVS
represents and warrants, on behalf of itself and its Subsidiaries, that (i) it
is the owner of the Licensed Patents, (ii) it has the full right and power to
grant the rights (including the licenses, covenants, and releases) set forth in
this Agreement, and (iii) no other party’s consent or approval is required for
the granting of such rights.

    


    3.6           This
Agreement shall be construed, and the legal relations between the parties hereto
shall be determined, in accordance with the law of the State of New York, USA,
as such law applies to contracts signed and fully performed in New York, without
regard to conflict of law principles.  The parties waive their rights
to a jury trial.

    


    3.7           Neither
AVS nor IBM shall be considered the author of this Agreement for the purpose of
interpreting any provision herein.

    


    3.
8           This
Agreement shall not be binding upon the parties until it has been signed by or
on behalf of each party.  No amendment or modification hereof shall be
valid or binding upon the parties unless made in writing and signed by the
parties.

    


    3.9           AVS
shall not have any obligation hereunder to institute any action or suit against
third parties for infringement of any of the Licensed Patents or to defend any
action or suit brought by a third party which challenges or concerns the
validity or coverage of any of the Licensed Patents. AVS is under no obligation
hereunder to file any patent application or to secure any patent or patent
rights or to maintain any patent in force.

    


    3.10           If
any section of this Agreement is found by competent authority to be invalid,
illegal or unenforceable in any respect for any reason, the validity, legality
and enforceability of such section in every other respect and the remainder of
this Agreement shall continue in effect so long as the Agreement still expresses
the intent of the parties.  However, if the intent of the parties
cannot be preserved, this Agreement shall be either renegotiated or
terminated.

    


    This
Agreement and its attachments, and referred-to sections of the SOW embody the
entire understanding of the parties with respect to the Licensed Patents, and
replace any prior oral or written communications between them.

    


    
      	
              Agreed
      to:

            	
              Agreed
      to:

            
	
              AVISTAR
      COMMUNICATIONS CORPORATION

            	
              INTERNATIONAL
      BUSINESS MACHINES CORPORATION

            
	
              By:
      ___________________________

            	
              By:
      ___________________________

            
	
              Name:
      

              Title:
      

            	
              ***

              ***

            
	
              Date:
      _________________________

            	
              Date:
      _________________________

            


    

    


    



    
      
        
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treatm ent request that has been filed separately with the Securities and
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    Schedule
A

    


    
      	
              Country
      Code

            	
              Patent/
      Publication Number

            	
              Kind

            	
              Title

            	
              Issue/
      Publication Date

            
	
              US

            	
              7398296

            	
              B2

            	
              Networked
      Audio Communication Over Two Networks

            	
              2008-07-08

            
	
              US

            	
              7206809

            	
              B2

            	
              Method
      For Real-Time Communication Between Plural Users

            	
              2007-04-17

            
	
              US

            	
              7185054

            	
              B1

            	
              Participant
      Display And Selection In Video Conference Calls

            	
              2007-02-27

            
	
              US

            	
              7152093

            	
              B2

            	
              System
      For Real-Time Communication Between Plural Users

            	
              2006-12-19

            
	
              US

            	
              7054904

            	
              B2

            	
              Marking
      And Searching Capabilities In Multimedia Documents Within Multimedia
      Collaboration Networks

            	
              2006-05-30

            
	
              US

            	
              6972786

            	
              B1

            	
              Multimedia
      Services Using Central Office

            	
              2005-12-06

            
	
              US

            	
              6959322

            	
              B2

            	
              UTP
      Based Video Conferencing

            	
              2005-10-25

            
	 
      	 
      	 
      	 
      	 
      
	
              US

            	
              6816904

            	
              B1

            	
              Networked
      Video Multimedia Storage Server Environment

            	
              2004-11-09

            
	
              US

            	
              6789105

            	
              B2

            	
              Multiple-Editor
      Authoring Of Multimedia Documents Including Real-Time Video And
      Time-Insensitive Media

            	
              2004-09-07

            
	
              US

            	
              6594688

            	
              B2

            	
              Dedicated
      Echo Canceller For A Workstation

            	
              2003-07-15

            
	
              US

            	
              6583806

            	
              B2

            	
              Videoconferencing
      Hardware

            	
              2003-06-24

            
	
              US

            	
              6437818

            	
              B1

            	
              Video
      Conferencing On Existing UTP Infrastructure

            	
              2002-08-20

            
	
              US

            	
              6426769

            	
              B1

            	
              High-Quality
      Switched Analog Video Communications Over Unshielded Twisted
      Pair

            	
              2002-07-30

            
	
              US

            	
              6351762

            	
              B1

            	
              Method
      And System For Log-In-Based Video And Multimedia Calls

            	
              2002-02-26

            
	
              US

            	
              6343314

            	
              B1

            	
              Remote
      Participant Hold And Disconnect During Videoconferencing

            	
              2002-01-29

            
	
              US

            	
              6237025

            	
              B1

            	
              Multimedia
      Collaboration System

            	
              2001-05-22

            
	
              US

            	
              6212547

            	
              B1

            	
              UTP
      Based Video And Data Conferencing

            	
              2001-04-03

            
	
              US

            	
              6081291

            	
              A

            	
              Methods
      And Systems For Multimedia Communication Via Public Telephone
      Networks

            	
              2000-06-27

            
	
              US

            	
              5978835

            	
              A

            	
              Multimedia
      Mail, Conference Recording And Documents In Video
    Conferencing

            	
              1999-11-02

            
	
              US

            	
              5915091

            	
              A

            	
              Synchronization
      In Video Conferencing (Videoconferencing And Data Conferencing
      System)

            	
              1999-06-22

            
	
              US

            	
              5896500

            	
              A

            	
              System
      For Call Request Which Results In First And Second Call Handle Defining
      Call State Consisting Of Active Or Hold For Its Respective Av
      Device

            	
              1999-04-20

            
	
              US

            	
              5884039

            	
              A

            	
              System
      For Providing A Directory Of Av Devices And Capabilities And Call
      Processing Such That Each Participant Participates To The Extent Of
      Capabilities Available

            	
              1999-03-16

            
	
              US

            	
              5867654

            	
              A

            	
              Two
      Monitor Videoconferencing Hardware

            	
              1999-02-02

            
	
              US

            	
              5854893

            	
              A

            	
              System
      For Teleconferencing In Which Collaboration Types And Participants By
      Names Or Icons Are Selected By A Participant Of The
      Teleconference

            	
              1998-12-29

            
	
              US

            	
              5802294

            	
              A

            	
              Teleconferencing
      System In Which Location Video Mosaic Generator Sends Combined Local
      Participants Images To Second Location Video Mosaic Generator For
      Displaying Combined Images

            	
              1998-09-01

            
	
              US

            	
              5758079

            	
              A

            	
              Call
      Control In Video Conferencing Allowing Acceptance And Identification Of
      Participants In A New Incoming Call During An Active
      Teleconference

            	
              1998-05-26

            
	
              US

            	
              5751338

            	
              A

            	
              Methods
      And Systems For Multimedia Communications Via Public Telephone
      Networks

            	
              1998-05-12

            
	
              US

            	
              5689641

            	
              A

            	
              Multimedia
      Collaboration System Arrangement For Routing Compressed Av Signal Through
      A Participant Site Without Decompressing The Av Signal

            	
              1997-11-18

            
	
              US

            	
              5617539

            	
              A

            	
              Multimedia
      Collaboration System With Separate Data Network And A/V Network Controlled
      By Information Transmitting On The Data Network

            	
              1997-04-01

            
	
              US

            	
              20080117965

            	
              A1

            	
              Multiple-Channel
      Codec And Transcoder Environment For Gateway, MCU, Broadcast, And Video
      Storage Applications

            	
              2008-05-22

            
	
              US

            	
              20080049792

            	
              A1

            	
              Interconnecting
      Network Locations Between Premises Network And Central Office Using
      Ethernet On Loop Plant

            	
              2008-02-28

            
	
              US

            	
              20070168426

            	
              A1

            	
              Storing
      And Accessing Media Files

            	
              2007-07-19

            
	
              US

            	
              20070088782

            	
              A1

            	
              Storage
      And Playback Of Media Files

            	
              2007-04-19

            
	
              US

            	
              20070088781

            	
              A1

            	
              Storing
      And Accessing Media Files

            	
              2007-04-19

            
	
              US

            	
              20070083596

            	
              A1

            	
              Storing
      And Accessing Media Files

            	
              2007-04-12

            
	
              US

            	
              20070083595

            	
              A1

            	
              Networked
      Audio Communication With Login Location Information

            	
              2007-04-12

            
	
              US

            	
              20070083594

            	
              A1

            	
              Device
      For Wireless Networked Communications

            	
              2007-04-12

            
	
              US

            	
              20070083593

            	
              A1

            	
              Wireless
      Networked Audio Communication

            	
              2007-04-12

            
	
              US

            	
              20070078932

            	
              A1

            	
              Audio
      Communication With Login Location Addressing

            	
              2007-04-05

            
	
              US

            	
              20070078931

            	
              A1

            	
              System
      For Managing Real-Time Communications

            	
              2007-04-05

            
	
              US

            	
              20070078930

            	
              A1

            	
              Method
      For Managing Real-Time Communications

            	
              2007-04-05

            
	
              US

            	
              20060168637

            	
              A1

            	
              Multiple-Channel
      Codec And Transcoder Environment For Gateway, MCU, Broadcast And Video
      Storage Applications

            	
              2006-07-27

            
	
              US

            	
              20060075121

            	
              A1

            	
              Registration
      Based Addressing And Call Handles To Establish
    Communication

            	
              2006-04-06

            
	
              US

            	
              20060064461

            	
              A1

            	
              Using
      Login-Based Addressing To Communicate With Listed Users

            	
              2006-03-23

            
	
              US

            	
              20060059266

            	
              A1

            	
              Registration
      Based Addressing Over Multiple Networks With Digital Audio
      Communication

            	
              2006-03-16

            
	
              US

            	
              20060041617

            	
              A1

            	
              Log-In
      Based Communications Plus Two Data Types

            	
              2006-02-23

            
	
              US

            	
              20060041616

            	
              A1

            	
              Audio
      Communications Using Devices With Different Capabilities

            	
              2006-02-23

            
	
              US

            	
              20050144284

            	
              A1

            	
              Scalable
      Networked Multimedia System And Applications

            	
              2005-06-30

            
	
              US

            	
              20040107255

            	
              A1

            	
              System
      For Real-Time Communication Between Plural Users

            	
              2004-06-03

            
	
              US

            	
              20040107254

            	
              A1

            	
              Method
      For Real-Time Communication Between Plural Users

            	
              2004-06-03

            
	
              US

            	
              20030187940

            	
              A1

            	
              Teleconferencing
      Employing Multiplexing Of Video And Data Conferencing
    Signals

            	
              2003-10-02

            
	
              WO

            	
              200077687

            	
              A1

            	
              System
      And Method For Browser-Based Multimedia Collaboration
      Reporting

            	
              21-Dec-2000

            
	
              WO

            	
              9938324

            	
              A1

            	
              Multifunction
      Video Communication Service Device

            	
              29-Jul-1999

            


    

    


    


    


    


    


    



    
      
        
          [***]
Indicates text has been omitted from this Exhibit pursuant to a confidential
treatm ent request that has been filed separately with the Securities and
Exchange Commission. 

        

         


      

      
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