**EXHIBIT10.7.1**

 

AGREEMENT 

 

THIS AGREEMENT made and entered into on the fourteenth day of September, 1992

 

BY AND BETWEEN 

 

NORTHERN TELECOM LIMITED, a corporation duly incorporated under the laws ofCanada, having its executive offices at 3 Robert Speck Parkway, Mississauga, Ontario, Canada, 

 

(hereinafter called “Northern Telecom”) 

 

AND: 

 

LVSOFTWARE, INC., a California corporation having its principal offices at 755 Page Mill Road, Palo Alto, California, 94304, 

 

(hereinafter called “Licensee”) 

 

WHEREAS Northern Telecom has developed, and has the right to license, software programs, known as the Design For Testability tool suite (DFT); and

 

WHEREAS Northern Telecom is prepared to license and to grant theuse of the Design For Testability tool suite (DFT) and the right to sub-license on a commercial basis under the provisions of this Agreement. 

 

NOW, THEREFORE, THIS AGREEMENT WITNESSETH THAT, IN CONSIDERATION OF THE MUTUAL PROMISES HEREINAFTER SET FORTH, THE PARTIES AGREE AS FOLLOWS: 

 

ARTICLE 1

 

DEFINITIONS 

 

As used herein, unless otherwise defined: 

 

(a) “Affiliate” shall mean a company which a Partyhereto, or its parent, effectively controls, directly or indirectly, other than a Subsidiary, through the ownership or control of shares in the company; 

 

(b) “Associated Utilities” shall mean the software elements, cells, or models described in Schedule C attached hereto andforming a part hereof; 

 

(c) “DerivativeWorks” shall mean any software produced by Licensee incorporating all or a portion of the Licensed Product; 

 

(d) “Documentation” shall mean those documents and other written materials related to the Licensed Product, as described in andsubject to certain conditions outlined in Schedule B attached hereto and forming a part hereof; 

 

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(e) “Distributor” shall mean any person to whom Licensee provides the LicensedProduct for sublicensing to End-Users; 

 

(f)“Effective Date” shall mean the date first above mentioned; 

 

(g) “End-Users” shall mean all persons or companies, other than Northern Telecom, its Affiliates, Subsidiaries and Manufacturing Licensees, which acquire, directly from Licensee or indirectly through a Distributor,the right to use a Licensed Product or Derivative Works, as contemplated in this Agreement; 

 

(h) “Licensed Product” shall mean the Design for Testability tool suite (DFT) and any portion or modification thereof, as described in and subject to certain conditions identified in ScheduleA attached hereto and forming a part hereof; 

 

(i)“Manufacturing Licensee” shall mean a third party with whom Northern Telecom or any of its Affiliates or Subsidiaries has entered into an agreement permitting such third party to make and sell or lease products based on products designedby or for and sold or leased by Northern Telecom, its Affiliates, or Subsidiaries; 

 

(j) “Subsidiary” shall mean a company which a Party hereto effectively owns or controls, and continues to own or control, directly or indirectly, more than fifty percent (50%) of the votingstock or shares. 

 

ARTICLE 2

 

LICENSE 

 

Northern Telecom hereby, as of the Effective Date, grants to Licensee subjectto the terms and conditions of this Agreement personal, non-exclusive, non-transferable, non-assignable, indivisible, worldwide rights and license: 

 

(i) to use, copy, translate, improve, enhance, and modify the Licensed Product object code and source code, to merge orhave merged such translations, modifications, improvements or enhancements into other programming material, to sub-license and distribute object code versions of Licensed Product or Derivative Works to End-Users, to copy, translate and modify theDocumentation and to use, sell or distribute copies of such Documentation; 

 

(ii) to appoint and to sub-license Distributors to sublicense for use and to distribute to End-Users object code versions of Licensed Product or Derivative Works under terms and conditions no lessstringent than those set out in this Agreement; and 

 

(iii) to place Licensed Product arid Derivative Works source code in escrow for the benefit of End-Users and Distributors and grant source code licenses to such End-Users and Distributors pursuant to which, in the event of abankruptcy or similar proceeding against Licensee or in the event of termination of this Agreement and the refusal of Northern Telecom to assume Licensee’s support obligations, such End-User or 

 

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Distributor would be granted a license to use such source code solely to maintain andsupport the Licensed Product or Derivative Works. 

 

NorthernTelecom also grants to Licensee the right to use Associated Utilities as models in the development and debugging of software produced by Licensee or for demonstration purposes, Associated Utilities must not be delivered to End-Users. 

 

No provision or term or condition of this Agreement shall affect the rights ofNorthern Telecom or any Subsidiary or Affiliate or Manufacturing Licensee to use the Licensed Product or Associated Utilities in the normal course of its and their businesses. 

 

Nothing contained herein shall transfer, or be deemed to transfer, or contemplate the transfer of, any rights in or to theLicensed Product, Associated Utilities, or Documentation other than those rights specifically granted herein, and in particular but without restricting the generality of the foregoing, Northern Telecom does not in any way transfer any right, title,or interest in or to the Licensed Product, Associated Utilities, or Documentation, or any element constituting a portion thereof to Licensee or Distributors or End-Users, other than the limited right granted herein. 

 

ARTICLE 3

 

GRANTBACK 

 

Licensee hereby grants to Northern Telecom, its Subsidiaries, Affiliates andManufacturing Licensees, a perpetual, irrevocable, transferable, assignable, worldwide, paid-up right to use Derivatives Works. Such right includes the right to modify the Derivative Works and to incorporate them into software or product for theirown internal use in the normal course of their business. 

 

Sourcecode for Derivative Works shall be delivered to Northern Telecom at such times as Licensee initially makes such Derivative Works available to an End-User and every twelve (12) month period thereafter to the extent that additional Derivative Workshave been made available to an End-User within the immediately preceding twelve (12) month period. 

 

Ownership in and to the Derivative Works (exclusive of any source code of the Licensed Product contained therein) and in and to any and all ideas, inventions, discoveries, creations, processes,techniques, designs, methods, improvements or know-how that Licensee may make, conceive, develop or reduce to practice (collectively, “Innovations”), regardless of whether such Innovations are developed as a result of Licensee’saccess to the Licensed Product, shall remain with and be vested in Licensee. 

 

ARTICLE 4

 

FURNISHING OF LICENSED PRODUCTS 

 

Northern Telecomshall furnish to Licensee Licensed Product, Associated Utilities, and Documentation as set out in Schedules A, B, and C within thirty (30) days of the Effective Date. 

 

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Northern Telecom shall furnishto Licensee for a period of thirty (30) months after the Effective Date all new versions and releases of the Licensed Product, Associated Utilities, and Documentation developed and used in its day to day operations (hereinafter “Updates”),however Northern Telecom shall not be obliged to develop or produce any new or unavailable versions or releases of Licensed Product, Associated Utilities, or Documentation to perform its obligations under this Agreement. Provided however thatNorthern Telecom shall not be obligated to furnish versions or releases co-developed with a third party. 

 

Licensee shall delete, as directed by Northern Telecom, all information, including reference to applications or interfaces, which is specific to Northern Telecom’s, its Affiliates, or Subsidiariesdevelopment or user environment. Northern Telecom shall have the right to review and approve such deletions and modifications. 

 

ARTICLE 5

 

ROYALTY 

 

In partial consideration of the rights granted hereunder Licensee shall make the following royalty payments (hereinafter “Royalties”) toNorthern Telecom: 

 

(i)Twenty-five thousand dollars ($25,000) US for each copy of a complete Licensed Product including, without limitation, Derivative Works or, if less than a complete copy, that proportion of such sum as represents the portion of a complete copy,sub-licensed by Licensee or a Distributor to End-Users during the first twelve (12) month period after the Effective Date, and 

 

(ii) Fifty thousand dollars ($50,000) US for each copy of a complete Licensed Product including, without limitation,Derivative Works or, if less than a complete copy, that proportion of such sum as represents the portion of a complete copy, sub-licensed by Licensee or a Distributor to End-Users during the subsequent nine (9) year period. 

 

Royalties shall become payable to Northern Telecom thirty (30) days followingeach sub-license granted by Licensee or by its Distributors. 

 

ARTICLE 6

 

MAINTENANCE ANDSUPPORT 

 

Licensee shall offer technical, product, and othersupport to Licensee’s Distributors and End-Users to facilitate the use of the Licensed Product and Derivative Works. Royalties shall not be paid on support or maintenance services provided by Licensee, including without limitation, thedistribution of enhancements, updates or improvements. 

 

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ARTICLE7

 

TECHNICAL ASSISTANCE 

 

Except as provided in Article 4, Northern Telecom support to Licensee will belimited to demonstrating Licensed Product capabilities to potential End-Users at Northern Telecom’s convenience and discretion. 

 

ARTICLE 8

 

RECORDS AND REMITTANCES 

 

Licensee shall keep, and shall require all Distributors to keep, clear and accurate records with respect to the Licensed Product. Northern Telecom shallhave the right, through its internal auditing experts, to examine and audit, during normal hours, annually (or at less frequent intervals upon reasonable notice to Licensee) all such records and such other records and accounts as may underrecognized accounting practices contain information bearing upon the amount of Royalties payable to it under this Agreement solely to verify compliance by Licensee of its obligation to pay Royalties to Northern Telecom. Prompt adjustment shall bemade by the proper Party to compensate for any errors or omissions disclosed by such examination or audit. Neither such right to examine and audit, nor the right to receive such adjustments, shall be affected by statements to the contrary appearingon cheques or otherwise, unless any such right is expressly waived by the Party having such right. Licensee shall furnish, and shall require all Distributors to furnish, whatever additional information Northern Telecom may reasonably prescribe fromtime to time to enable Northern Telecom to ascertain amounts payable thereon. 

 

Within thirty (30) days following the end of each quarterly period ending on March 31, June 30, September 30, and December 31 commencing with the period which ends on December 31, 1992, and continuing thereafter until all Royaltiespayable hereunder shall have been reported and paid, Licensee shall furnish to Northern Telecom a statement, in a form reasonably acceptable to Northern Telecom, certified by an authorised official of Licensee, recording all Licensed Productsublicensed to End-Users hereunder and the Royalties payable thereon. If no Licensed Product has been sublicensed to End-Users, that fact shall be shown on such statement. In the event of a return of the Licensed Product or Derivative Works or suchother event that shall result in full or partial refund to the End-User, Licensee may deduct such amount from the next Royalty payment to Northern Telecom. Within the same period of thirty (30) days, Licensee shall, irrespective of terms granted orcollections made on account of any items subject to Royalties, remit to Northern Telecom the Royalties payable hereunder for such quarterly period. 

 

All payments to be made by Licensee to Northern Telecom shall be made in U.S. dollars at Northern Telecom’s address as shown in Article 16 hereof, orat such other address in Canada or the USA as Northern Telecom shall have specified by written notice. Payments related to Licensee’s licensing activities in the USA shall be made to: 

 

Northern Telecom Inc. 

200 Athens Way, 

Nashville, Tennessee, 

 

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U.S.A. 37228 

 

Attention: Sue Kane, Dept. 8452. 

 

Licensee shall pay either to the appropriate taxing authority or to NorthernTelecom upon receipt of an invoice therefor, all taxes or other levies imposed as a result of the existence or operation of this Agreement including, but not restricted to, registration fees, stamp taxes, remittance fees, sales, value added or usetaxes, customs duties or other governmental charges of any kind whatsoever, resulting from the granting or transfer of the License hereunder, all such taxes or levies, sales, value added, goods and services taxes and/or withholding taxes, due orimposable with respect to Royalties, shall be borne by Northern Telecom. Nothing herein contained shall make either party responsible for any tax on income imposed on the other by the laws of any country or any political subdivision thereof on theincome or profits of such party. 

 

To assist either party inobtaining a credit or deduction with respect to withholding taxes, each party shall furnish the other with such evidence as may be required by Canadian or USA taxing authorities to establish that such tax has been paid. 

 

Payments when provided for in this Agreement shall, when overdue, bearinterest at a rate of two percent (2%) over the Canadian prime rate as quoted by the Royal Bank of Canada at Toronto, Canada computed on a daily basis. 

 

ARTICLE 9

 

SUBLICENSING 

 

In exercising its right to grant sublicenses as set out in Article 2 of this Agreement, Licensee shall, and shall oblige all Distributors to, enter intosub-license agreements with End-Users which shall contain substantially the following provisions: 

 

(a) End-User shall acquire no right, title or interest in or to the Licensed Product or Documentation other than the right to use theLicensed Product and Documentation and such use shall be limited to specific individual central processing units bearing a specific serial number and having a specific location; 

 

(b) End-User shall hold the Licensed Product and Documentation in confidence for Northern Telecom andLicensee and shall not at any time use or reproduce the Licensed Product or Documentation except as expressly permitted hereunder or divulge the Licensed Product and Documentation to any person other than employees of End-User with a need to know,without the prior written consent of Northern Telecom and Licensee; and 

 

(c) the right to use the Licensed Product and Documentation shall be in accordance with the laws applicable in the countries of the End-Users but so as not to affect, but to preserve, the proprietary and confidential natureof the Licensed Product and Documentation and any patent, copyright or other rights of Northern Telecom, its Subsidiaries and Affiliates applicable to the Licensed Product and Documentation. 

 

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Licensee or its Distributors,as applicable, shall negotiate, execute, administer and monitor each of the Licensed Product and Documentation sublicense agreements to ensure compliance with all the relevant provisions of this Agreement. The form normally used by Northern Telecomfor such purposes is attached, as an example, hereto as Schedule D. 

 

Nothing in this Agreement shall be construed as granting the right for any Distributor, or any End-User to disassemble, decompile, or otherwise reverse engineer the object code versions of the Licensed Product delivered by NorthernTelecom pursuant to this Agreement. 

 

In the event an End-User isin default under its sublicense agreement, Licensee shall so advise Northern Telecom in writing promptly upon discovery thereof, and exercise as soon as reasonably possible, such rights and recourses, using commercially reasonable efforts, asNorthern Telecom may have in the circumstances with particular emphasis on preserving the proprietary and confidential nature of the Licensed Product and Documentation and any patent, copyright or other rights of Northern Telecom, its Subsidiariesor Affiliates applicable to Licensed Product and Documentation. 

 

ARTICLE 10

 

CONFIDENTIALINFORMATION 

 

Licensee or its Distributors, as applicable,acknowledges that the Licensed Product and any information communicated to or acquired by Licensee as a result of the provision of technical assistance pursuant hereto (hereinafter collectively “Northern Telecom Confidential Information”)is and shall continue to be the exclusive property of Northern Telecom, and is proprietary and constitutes a trade secret of Northern Telecom. Licensee shall hold the Northern Telecom Confidential Information in confidence for Northern Telecom andonly make use of, or disclose, it as permitted by this Agreement. 

 

Northern Telecom acknowledges that the Derivative works (exclusive of any Licensed Product source code contained therein) and any information communicated to or acquired by Northern Telecom as a result of the provision of technicalassistance pursuant hereto (herein collectively “Licensee Confidential Information”) is and shall continue to be the exclusive property of Licensee. and is proprietary and constitutes a trade secret of Licensee. Northern Telecom shall holdthe Licensee Confidential Information in confidence for Licensee and only make use of, or disclose it as permitted by this Agreement. 

 

The Northern Telecom Confidential Information and the Licensee Confidential Information is herein collectively referred to as “ConfidentialInformation”. 

 

Each party shall, during the full term ofthis Agreement and for five (5) years thereafter hold secret arid not disclose, to any person (except to such of its employees as are required to use the Confidential information of the other party. and then only under an obligation ofnon-disclosure and non-use binding upon such employee) any of the Confidential Information of the other party except as follows: 

 

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(a) toDistributors and End-Users pursuant to Article 2 of this Agreement, provided such persons agree to be bound by the confidentiality provisions of this Article 10; 

 

(b) to Northern Telecom’s Affiliates, Subsidiaries, and Manufacturing Licensees pursuant to Article 3 ofthis Agreement, provided however that such Affiliates, Subsidiaries, and Manufacturing Licensees have been bound by the confidentiality provisions of this Article 10; and 

 

(c) to the extent the Confidential Information of the other party: 

 

(i) becomes available to the public from asource other than the recipient of such Confidential Information before or during the period of this Agreement; 

 

(ii) is lawfully obtained by the recipient of such Confidential Information from a third party or parties without breachof confidentiality obligations; or 

 

(iii) is documented as being known to the recipient of such Confidential Information prior to its disclosure. 

 

Neither party shall make or have made or permit to be made. any copies of the Confidential Information of the other party except those copies which areexpressly permitted hereunder, and all such copies shall, upon reproduction and whether or not in the same form or format as the Confidential Information of the other party, contain the same proprietary and confidentiality notices or legends whichappear on such Confidential Information provided pursuant hereto. 

 

ARTICLE 11

 

MARKETING ANDSUBLICENSING 

 

Licensee shall use reasonable efforts to, as soonas possible after the Effective Date, begin the marketing and sublicensing of the Licensed Products as contemplated by this Agreement. 

 

Licensee shall for the duration of this Agreement use its best efforts to develop, supply and service as extensive a market as possible for the LicensedProduct throughout the world. 

 

ARTICLE 12

 

LIABILITY 

 

Northern Telecom has developed the Licensed Product and Associated Utilitiesindependently and to the best of Northern Telecom’s knowledge they constitute original concepts and ideas not derived from the unauthorised use of any party’s proprietary information. Other than the preceding, Northern Telecom makes noother representations in respect to and does not warrant the Licensed Products or Associated Utilities furnished pursuant hereto, but shall furnish same in good faith to the best of its knowledge and ability to perform in accordance with theDocumentation. Northern Telecom shall not be liable for any claims, injuries, or damages, direct, indirect, or consequential, arising from the use of, or the inability to use, the Licensed Product or Associated Utilities. Without restricting thegenerality of the foregoing, Northern 

 

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Telecom makes norepresentations or warranties as to the merchantability or fitness for a particular purpose, or as to whether or not the use of the Licensed Product or Associated Utilities supplied hereunder may infringe any patent or other rights of any otherperson. 

 

Licensee shall indemnify and hold Northern Telecomharmless from any and all claims for damages, losses, expenses or costs (including counsel fees and expenses) arising out of Licensee’s distribution and sublicensing, directly or indirectly, of the Licensed Products and Derivative Works.

 

Northern Telecom shall indemnify and hold Licensee harmless fromany and all claims for damages, losses, expenses or costs (including counsel fees and expenses) arising out of the use of the Derivative Works by Northern Telecom, its Affiliates, Subsidiaries or Manufacturing Licensees. 

 

ARTICLE 13

 

FORCE MAJEURE 

 

Neither Party shall be in default or liable for any loss or damage resultingfrom delays in performance or from failure to perform or comply with terms of this Agreement due to any causes beyond its reasonable control, which causes include but are not limited to Acts of God or the public enemy, riots and insurrections, war,accidents, fire, strikes and other labor difficulties (whether or not the Party is in a position to concede to such demands), embargoes, judicial action, lack of or inability to obtain export permits or approvals, necessary labor, materials, energy,components, or machinery, acts of civil or military authorities. 

 

ARTICLE 14

 

DURATION ANDCONTINUING RIGHTS 

 

This Agreement shall continue until theearlier of ten (10) years after the Effective Date and the full and final payment of all sums due Northern Telecom hereunder, or, until terminated pursuant to Article 15 hereof. 

 

Provided this Agreement is not terminated prior to ten (10) years after the Effective Date, Licensee shall on that date,possess a fully paid up license to exercise the rights granted in Article 2 without, however, having the obligation of providing statements and making payments as prescribed in Articles 5 and 8 hereof. 

 

ARTICLE 15

 

TERMINATION 

 

In the event either Party shall be in material breach of this Agreement orfail to perform one or more of its material obligations under this Agreement, the other Party may, by written notice to the party in default, require the remedy of the breach or the performance of the obligation and, if the Party so notified failsto remedy such breach or to perform such obligation within one 

 

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hundred and twenty (120) daysof the forwarding of a notice so to do, the first such Party may, by written notice, terminate this Agreement. 

 

Any termination of this Agreement by or against one Party shall be termination of this Agreement by or against the other Party hereto. 

 

In the event of an enforceable decision or directive declaring invalid an essential part of this Agreement, without whichthis Agreement would not have been entered into, this Agreement may, at the option of either Party, be terminated upon the giving of notice to the other Party. Save as before set forth, in the event that any term, clause, provision or condition ofthis Agreement shall be similarly adjudged invalid for any reason whatsoever, such invalidity shall not affect the validity or operation of any other term, clause, provision or condition and such invalid term, clause, provision or condition shall bedeemed to have been deleted from this Agreement. 

 

In the eventLicensee becomes insolvent or is the object of bankruptcy or insolvency proceedings, or makes an assignment for the benefit of its creditors, or is placed in receivership or liquidation, or fails to satisfy any final judgement rendered against itwithin the period so permitted, then, Northern Telecom may, without any delay, by written notice, terminate this Agreement. 

 

In the event that a producer of products similar or related to Northern Telecom’s products acquires a controlling interest (controlling notnecessarily requiring greater than 50%) or a major equity participation in Licensee, without first having obtained the written consent of Northern Telecom, Northern Telecom may, without any delay, by written notice, terminate this Agreement.

 

In the event of termination prior to the expiration of thisAgreement Licensee shall discontinue the exercise of the rights granted hereunder. and shall render an immediate accounting and make payment of all royalties and other sums due hereunder or to become due upon the sublicensing of the LicensedProducts. Licensee shall promptly deliver to Northern Telecom all the Licensed Products, Associated Utilities, and Documentation supplied pursuant hereto, and shall erase all electronically stored copies thereof, and shall certify, in writing toNorthern Telecom, that such destruction has taken place. 

 

Notwithstanding anything else contained herein, in the event this Agreement is terminated, End-Users shall continue to have the right to use such software provided: 

 

(a) such End-User is not in default under its written End-User sublicense agreement with Licensee;

 

(b) such End-User sublicense is not inconsistentwith the terms of this Agreement; 

 

(c) the rightsof Licensee as sublicensor are assigned to Northern Telecom if Northern Telecom so requests; and 

 

(d) the rights and obligations of Licensee as sublicensor to End-Users pursuant to maintenance agreements as contemplated in Article 6 herein which are in full force and effect 

 

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without default are assignedto Northern Telecom if Northern Telecom so requests; provided, however, notwithstanding anything to the contrary contained in this Agreement, in the event that Northern Telecom shall not assume all rights and obligations of Licensee as sublicensorto End Users pursuant to maintenance agreements which are in full force and effect, Licensee shall be permitted to retain the Licensed Product source code and to distribute object code versions of such improvements, modifications and enhancementspursuant to Licensee’s maintenance obligations. 

 

Notwithstanding the expiry or termination of this Agreement, the provisions of Article 10 related to confidentiality and non-use. the provisions of Article 12 related to liability and indemnification, and the provisions of Article 14related to the grant of a perpetual license shall survive as though this Agreement had continued. 

 

ARTICLE 16

 

NOTICES 

 

Any and all notices or otherinformation to be given by one of the Parties to any other shall be deemed sufficiently given when forwarded by mail, cable, telegram, telex, facsimile or hand delivery to such other Party at the following addresses: 

 

If to Licensee: 

 

LV Software, Inc. 

1175 Senecal, 

Brossard, Quebec, 

Canada, J4X 1L3 

 

Attention: ChiefExecutive Officer (Dr. V.K. Agarwal) 

Facsimile Number: 514-923-9993 

 

If to Northern Telecom: 

 

Northern Telecom Limited 

P.O. Box 458, Station A, 

Mississauga, Ontario

Canada 

L5A 3A2 

Attention: Secretary 

 

with a copy to: 

 

Bell-Northern Research Ltd 

3500 Car4ing Avenue, 

NepeZri, Ontario, Canada 

K2H 8E9 

 

Attention: Secretary 

 

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FacsimileNumber: 613-763-5920 

 

and such notice shall be deemed to havebeen received five (5) business days after mailing it forwarded by mail, and the following business day if forwarded by cable, telegram, telex, facsimile or hand. 

 

The aforementioned address of any Party may be changed at any time by giving five (5) business days prior notice to the otherParties in accordance with the foregoing. 

 

In the event of agenerally prevailing labor dispute or other situation which will either delay or impede the giving of notice by any such means, the notice shall be given by such specified mode as will be most reliable and expeditious and least affected by suchdispute or situation. 

 

ARTICLE 17

 

GENERAL PROVISIONS 

 

This Agreement shall not be assigned or transferred by either Party exceptwith the written consent of the other. Notwithstanding the foregoing, this Agreement may be assigned by Northern Telecom to any of its Subsidiaries or Affiliates upon notification to Licensee. 

 

The Parties recognize that the transfer of Licensed Product or AssociatedUtilities to certain countries may be subject to the prior specific approval of the Government of Canada, or various agencies thereof, and international control organizations in which the Government of Canada participates, including in particularthe Free World Co-ordinating Committee (sometimes known as “CoCom”). Accordingly, Licensee shall not sublicense, use, or otherwise communicate or transfer Licensed Products or any technical information to such countries without receivingthe necessary prior specific approvals. 

 

Nothing in thisAgreement shall be construed as requiring Northern Telecom to disclose technical information, or to grant rights under licenses, or to render any technical assistance, which would violate any confidentiality undertakings which it has towards thirdpersons or which would violate any present or future law or decree of any government or governmental officer or agency, and nothing contained herein shall require the disclosure of technical information which would increase or impose any obligationson Northern Telecom with respect to third parties. 

 

Nothing inthis Agreement shall be construed as 

 

(a)requiring Northern Telecom to file any patent application, to secure any patent or to maintain any patent in force; 

 

(b) constituting a warranty that or representation by Northern Telecom as to the validity or scope of any patent licensed hereunder;

 

(c) constituting a warranty or representationthat any sublicensing by Licensee hereunder will be free from infringement of patents other than those under which and to the extent to which licenses are granted hereunder; 

 

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(d)constituting an agreement to bring or prosecute actions or suits against third parties for infringements; 

 

(e) conferring upon Licensee any right to use, in advertising or publicity, any name, trade name or trademark. or any contraction,abbreviation or simulation thereof without the prior written approval of Northern Telecom. Licensee may, however, disclose to potential End-Users and Distributors the fact that the original Licensed Product was developed by Bell-Northern ResearchLtd., an affiliate of Northern Telecom; or 

 

(f)conferring by implication. estoppel. or otherwise upon Licensee any license or other right under any patent, except the licenses and rights expressly granted hereunder to Licensee. 

 

Nothing contained in this Agreement shall limit, in any manner, Northern Telecom’s right to discontinue or change thedesign or characteristics of the Licensed Product at any time without notice and liability. 

 

The failure of any Party to give notice to any other Party of the breach or non-fulfillment of any term, clause, provision or condition of this Agreement shall not constitute a waiver thereof, norshall the waiver of any breach or non-fulfillment of any term. clause, provision or condition of this Agreement constitute a waiver of any other breach or non-fulfillment of any term, clause, provision of condition of this Agreement. 

 

This Agreement sets forth the entire agreement and understanding between theParties with respect to the licensing of Licensed Products and Associated Utilities and supersedes and cancels all previous negotiations, agreements, commitments and writings in respect of the subject matter hereof, and no Party hereto shall bebound by any term, clause, provision or condition save as expressly provided in this Agreement or as duly set forth on or subsequent to the date hereof in writing, signed by duly authorised officers of the Parties. The Parties may, however, modifySchedules A, B, and C hereto, from time to time, by written instrument signed by representatives of both Parties, provided any such modification does not materially change the scope and substance of this Agreement. 

 

Nothing in this Agreement shall be construed as establishing or implying anypartnership between the Parties hereto, and nothing in this Agreement shall be deemed to constitute any of the Parties hereto as the agent of any other Party or authorize any Party to incur any expenses on behalf of any other Party or to commit anyother Party in any way whatsoever, without obtaining the other Parties’ prior written consent. 

 

Terms, conditions and general terms of this Agreement shall be held in confidence by all Parties and only disclosed as may be agreed to by all Parties or as may be required to meet securitiesdisclosure or export permit requirements. Neither Party shall make public statements or issue publicity or media releases with regard to this Agreement or the relationship between the Parties without the prior written approval of the other Party.

 

If any action at law or in equity is brought relating to thisAgreement or the breach hereof, the prevailing Party in any final judgment or arbitration award, or the non-dismissing Party in the event of a dismissal without prejudice, shall be entitled to the full amount of all reasonable 

 

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expenses, including all courtcosts, arbitration fees and actual attorney’s fees paid or incurred in good faith. 

 

This Agreement shall be construed in accordance with and governed by the laws of the Province of Ontario, Canada. 

 

IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement. 

 

LV SOFTWARE, INC.
   
NORTHERN TELECOM LIMITED

Per:
 
/s/ V. K. Agarwal
   
Per:
 
/s/ G. C. Smyth

Name:
 
V. K. Agarwal
   
Name:
 
G. C. Smyth

Title:
 
Chief Executive Officer
   
Title:
 
Executive Vice-President
      
Per:
 
/s/ D. J. DeGrandis
      
Name:
 
D. J. DeGrandis
      
Title
 
Secretary

 

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SCHEDULE A

 

LICENSED PRODUCT 

 

Licensed Product consists of a Design for Testability tool suite whichincludes the following tools delivered in source code form: 

 
 (1) SCANCHEK, Version 5 Release 3 (5.03): 
 

SCANCHEK compiles a circuit description from Verilog structural netlists and checks the logic for compliance to a set of Scan rules. Italso extracts the combinational logic driven by the scan chain as well as a description of the Scan chain connections and pin types. 

 
 (2) ATPG. Version 5 Release 3 (5.03): 
 

Automatic Test Pattern Generator (ATPG) generates and/or evaluates a set of test vectors for the faults in the combinational part of thelogic of a circuit. ATPG applies random patterns to detect most faults and switches to deterministic algorithms to find the remaining one. Optionally, the random patterns can be generated by a Linear-Feedback Shift-Register (LFSR) and the expectedresponses for the circuit are compressed and expressed in terms of a 32-bit signature. 

 
 (3) SEQUENCE, Version 5 Release 3 (5.03): 
 

SEQUENCE populates a test pattern data base with the test patterns generated by ATPG for the combinational portion of the circuit.SEQUENCE automatically adds generic test patterns for the scan chain itself and asynchronous set/reset pins, if applicable. 

 
 (4) TPI, Version 5 Release 2 Maintenance Release 1 (5.02.01): A Test Point Insertion tool. 
 
 (5) RamBist, Version 5 Release 2 (5.02): A tool to perform built-in self test for memories. 
 
 (6) ScanBist, as available for Versi,)n5 (5.00): A tool to perform built-in self test for Scan-based designs 
 
 (7) IATPG, as available for Version 5 (5.00): A tool to perform interconnect ATPG. 
 
NOTE: Included in the above are software elements or modules which must be modified by Licensee. Such modification must be approved by Northern Telecom or its agent,Bell-Northern Research Ltd. (BNR), before Licensee delivers such modifications or Derivative Works to End Users. The software elements or modules are known as: 
 

 

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 a. In SCANCHEK; 
- Cadence menus 

- ScanBist support 

- BNR specific options 

 
 b. In ATPG: 
-Cadence menus 

- ScanBist support 

- BNR specific options 

 
 c. In SEQUENCE 
- Cadence menus 

- “Fast simulation” 

- BNR specific options 

 

Licensed Product also includes the following utility delivered in object code form only and may be delivered to End-Users in object code form:

 
 i. dh2tif, Version 5 Release 2 (5.02): 
A utility to extract test patterns from a DATAHUB file and convert into a TIF (Tool Interchange Format). 

 

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SCHEDULE B

 

DOCUMENTATION 

 

Documentation associated with Licensed Product consists of the following:

 
 (1) Scan Reference Guide, Version 5 Release 3 (5.03):               CCP 143.1
 
 (2) DFT Application Notes, Version 5 Release 2 (5.02):              CCP 146.1 
 
 (3) DFT Guidelines, Version 5 Release 1 (5.01):                        CCP 146.2 
 
 (4) Memory Bist guidelines, as available for Version 5 (5.00): 
 
 (5) ScanBist documentation, as available for Version 5 (5.00): 
 
 (6) TIF format description, as available for Version 5 (5.00): 
 
NOTE: The above documentation must be modified by Licensee. Such modification must be approved by Northern Telecom or its agent, Bell-Northern Research Ltd., beforeLicensee delivers such modifications to End-Users. 
 

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SCHEDULE C

 

ASSOCIATED UTILITIES 

 

Associated Utilities include the following software elements, cells, or modelswhich are delivered to Licensee in object code form or as ASCII files. They can be used by Licensee as models for developing and debugging new software or for demonstration purposes but must not be delivered to End-Users. 

 
 (1) mx (Version 5, Release 2) 
A general purpose macro preprocessor. 

 
 (2) syntran (As available for Version 5) 
A utility to convert a FML2 file to a Verilog HDL file. 

 
 (3) cells 
Asubset of simple BATMOS gates including Verilog nominal and SCAN models only. 

 
 (4) BSCAN macros 
A collection of cells for implementing Boundary Scans 

 
 (5) TAP macros 
A collection of cells for implementing Test Access Port 

 
 (6) memory macros 
 

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SCHEDULE D

SOFTWARE USE AGREEMENT 

 

Subject to the provisions contained herein _________ (“Grantor”) grants a non exclusive license to use the proprietary Software defined below tothe “User” whose duly authorized signature appears below. 

 

SOFTWARE 

 

“Software” furnishedunder this Agreement shall mean each set of programs in machine-readable code, provided on magnetic tape or other storage media, which provides basic logic, operating instructions and user related application instructions (as well as associatedsoftware documentation) that is incorporated in or furnished for use with the system designated below (“System”). 

 

LICENSE TERM AND CHARGES 

 

The User shall pay the sum of $_________ or separate payments of $_________ payable monthly/quarterly/annually for a period of            year(s) to Grantor giving the User the right to use the Software for             years from the datehereof, under the conditions set out herein and the reverse side hereof. 

 

Thereafter, provided the User has paid the sum or sums specified above and observes all other provisions of this Agreement, the User shall have the option to renew this Agreement for successive one year periods in consideration ofthe payment of $             per annum. Notwithstanding the foregoing, this Agreement shall not extend beyond the discontinuance by the User or its assignee of the use of the Systemor the Software, whichever comes first. 

 

The User shall limit theuse of the Software to itself, for installation, operation and maintenance of the specific individual processing unit(s) forming part of the System designated as follows: 

 

System (including Serial No.): _________________________             

Software:                                    _________________________

Location:                                    _________________________

 

This Agreement, including the attached Conditions,represents the sole and entire agreement between the parties in regard to the Software supplied for the above single System, and supersedes all prior agreements and representations between them. This Agreement is binding upon the parties uponexecution by Grantor and User. 

 

Executed this ____ day of_________, 19__ at ______________: 

 

_________________________________    ____________________________ 

    (“Grantor”)                                                             (“User”) 

 

Per:    ____________________________    Per:    _______________________                          

 

           ____________________________               _______________________ 

    (Title ofSignatory)                                                (Title of Signatory) 

 

 

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CONDITIONS

 
 (1) Title 
 

Title and ownership rights to the Software shall remain in Grantor’s licensors and shall in no circumstances be acquired by User.

 
 (2) Assignment 
 

In the event of the bona fide lease or sale of the System by the User to any third party, the User shall have the right to assignthis Agreement to such third party, provided that the third party agrees in writing to abide by the terms and conditions of this Agreement and that Grantor is furnished with a signed copy of the assignment including the undertaking of the thirdparty required under this Section. 

 
 (3) Confidentiality and Security 
 

The User shall hold the Software in confidence for Grantor and Grantor’s licensors and shall not, during the course of this Agreementor at any time thereafter, use, modify or reproduce the Software except as expressly permitted in this Agreement, or divulge the Software to any person other than employees of the User with a need to know, without the prior written consent ofGrantor. This obligation shall continue if the Software is removed from service or this Agreement is terminated for any reason. 

 

The obligation to the User hereunder shall not extend to that portion of the Software which has become part of the public domain by actsnot attributable to the User. 

 

The User shall notreproduce the Software in whole or in part, without the prior written consent of Grantor, which consent will not be unreasonable withheld. The User shall not modify the Software except as authorized in writing by Grantor. 

 

The User shall issue appropriate instructions to its employeesto satisfy it obligations hereunder. 

 
 (4) Payment 
 

The User shall make payment(s) as required herein and/or by the sales agreement related to the System (“Sales Agreement”).

 
 (5) Warranty and Limits of Liability 
 

Grantor warrants that, as of the date of delivery of Software to User, the Software shall conform to the relevant System documentation.This warranty shall cease upon the date when the System incorporating the Software is first 

 

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placed inservice by User. With the view of supporting Software operation after that date, Grantor’s sole obligation shall be to provide or cause to be provided, without charge to User during the period of one (1) year from the System in-service date, orof fourteen (14) months from the date of delivery of the Software to User, whichever period first expires, technical assistance service upon the conditions stated in the relevant System documentation, with the objective of diagnosing and correctingerrors in Software. 

 

Neither Grantor norGrantor’s licensor shall be liable for any claims, injuries or damages, direct. indirect or consequential, arising from the use of, or the inability to use, the Software. Grantor disclaims all warranties including those of merchantability orfitness for use except as specifically set forth herein. 

 
 (6) Support Service Agreement 
 

Within six months from the date of this Agreement, User shall enter into a support service agreement with Grantor, in accordance withGrantor’s standard terms and conditions and at its then prevailing rates, providing for support services, in relation to the Software licensed for use hereunder, during the period when Grantor ceases to be obligated to provide technicalassistance services under section 5 above. 

 
 (7) Assignment 
 

The rights and obligations of Grantor under this Agreement may be assigned to such firm or corporation as may be specified in writtennotice given to User by Grantor or by Grantor’s licensor. 

 
 (8) Termination 
 

In the event the User shall be in breach of this Agreement or fail to perform one of more of its material obligations under thisAgreement, and in the event such breach is not remedied by the User within sixty (60) days of the giving of notice of such breach, in addition to any remedies permitted by law or otherwise, Grantor shall have the right to terminate this Agreement.In the event of such termination the User shall, unless Grantor approved otherwise, return the Software to Grantor (including all permitted reproductions). 

 

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