Software Oem License Agreement

EXHIBIT 10.22


SOFTWARE OEM LICENSE AGREEMENT


This Software License and OEM Agreement ("Agreement") is entered into this 19th day of May, 1997 (the "Effective Date") by and between Summit Design, Inc., a Delaware corporation with principal offices at 9305 SW Gemini Drive, Beaverton, Oregon 97008 and Test Systems Strategies, Inc., an Oregon corporation (collectively, "SDI"), and Credence Systems Corporation, a Delaware corporation with principal offices at 215 Fourier Avenue, Fremont, California 94539 ("CSC").


RECITALS


WHEREAS, CSC desires to purchase licenses to certain SDI software products, and SDI desires to sell such licenses to CSC in accordance with the terms of this Agreement; and


WHEREAS, SDI desires to grant to CSC, and CSC desires to receive from SDI, a non-exclusive license to bundle certain of SDI's products with certain CSC products and to distribute such SDI products, in object code format only, with CSC's products in accordance with the terms of this Agreement;


NOW, THEREFORE, in consideration of the foregoing and the mutual covenants contained herein, the parties agree as follows:


Section 1
DEFINITIONS


For purposes of this Agreement the following terms shall have the meanings set forth below:


1.1 CSC PRODUCTS. "CSC Products" means those CSC automatic test equipment products which are described on SCHEDULE A attached to this Agreement, as it may be amended from time to time by mutual agreement of the parties.


1.2 SDI DOCUMENTATION. "SDI Documentation" means all written or electronic technical documentation furnished by SDI during the term of this Agreement that relates to the VTB Software.


1.3 VTB. "VTB Software" means SDI's proprietary software, in machine-readable, compiled object code format only, as more fully described on SCHEDULE B, including any bug fixes, corrections, or other modifications hereinafter furnished to CSC by SDI in connection with the VTB Software, whether requested by CSC pursuant to a Maintenance Agreement between CSC and SDI or initiated by SDI.


1.4 MAINTENANCE AGREEMENT. "Maintenance Agreement" shall mean the maintenance agreement for maintenance of the VTB Software in the form set forth in SCHEDULE C.


1.5 END USER LICENSE AGREEMENT. "End User License Agreement" shall mean the end user license agreement for the VTB Software in the form set forth in SCHEDULE E.


Section 2
PURCHASE GRANT AND DELIVERABLES


2.1 VTB SOFTWARE LICENSE PURCHASE. CSC shall purchase licenses to the VTB Software for the prices and in the quantity set forth in SCHEDULE D, in accordance with the terms set forth in SCHEDULE D. Each of such licenses shall be subject to the terms of the End User License Agreement.


2.2 MAINTENANCE PURCHASE. CSC and SDI shall execute the Maintenance Agreement set forth in SCHEDULE C, as of the date hereof. CSC shall sign an irrevocable purchase order for such Maintenance Agreement for eighteen (18) months of maintenance for an aggregate purchase price of $2,000,000. Payment shall be made upon Closing (as defined in the Asset Purchase Agreement among CSC, SDI and Test Systems, Inc.) ("Closing") by wire transfer to a bank account designated by SDI.


2.3 DISTRIBUTION LICENSE. Subject to the terms and conditions of this Agreement, SDI hereby grants to CSC and its affiliates, under all of SDI's intellectual property rights in and to the VTB Software, a worldwide, non-exclusive, non-transferable (except as provided in Section 10.2 below) license to use the VTB Software for internal purposes (provided a license for such use has been purchased from SDI) and distribute units of VTB Software purchased hereunder through its normal distribution channels, in machine-readable, compiled object code format only, and only when bundled with CSC Products or sold to customers of CSC who have purchased CSC Products. For each CSC Product sold to a customer, CSC shall only issue one (1) VTB Software license and the VTB Software shall only be distributed to end users who agree to be bound by the terms of the End User License Agreement. Except as expressly provided in Section 2.4 below, CSC shall have no right to sublicense the rights granted hereunder by SDI, provided that CSC and its affiliates may use subdistributors in their distribution efforts ' CSC agrees that it shall be responsible for the compliance of its affiliates and subdistributors of the relevant terms of this Agreement. CSC shall not distribute or market the VTB Software in any manner except as expressly provided in this Section 2.3. Notwithstanding the foregoing, SDI agrees that it shall not distribute the VTB Software through OEM's which are automatic test equipment vendors to the semiconductor industry prior to January 1, 2000.


2.4 SUBLICENSING OF VTB SOFTWARE BY CSC.


2.4.1 RESTRICTIONS. Each unit of VTB Software shall be distributed by CSC with a license in the form set forth on SCHEDULE E.


2.4.2 INDEMNITY. CSC shall be solely responsible for, and SDI shall have no obligation to honor, any warranties that CSC provides to its customers with respect to the VTB Software that are in addition to, or inconsistent with, the warranties provided by SDI in this Agreement or the End User License Agreement. CSC shall defend any claim against SDI arising in connection with any such warranties to CSC's customers, express, implied, statutory, or otherwise, and shall pay any settlements or damages awarded to SDI that are based on any such warranty.


2.4.3 INFRINGEMENTS. CSC agrees to use reasonable commercial efforts to enforce violations or infringements under any agreements for the VTB Software with its customers and to inform SDI promptly of any known violation, infringement or breach.


2.5 DOCUMENTATION. SDI shall provide the SDI Documentation include with each unit of the VTB Software.


2.6 PROPRIETARY NOTICES. CSC shall not remove, efface or obscure any copyright notices or other proprietary notices or legends from any SDI materials provided hereunder.


2.7 OWNERSHIP. SDI shall retain all right, title and interest, including all intellectual property rights, in and to the VTB Software and SDI Documentation, except as otherwise provided in the Software Development Agreement of even date herewith.


2.8 REPORTING. CSC shall, within thirty (30) days of the end of each calendar quarter during the term of this Agreement, prepare a report summarizing the number and type of copies of VTB Software distributed during such quarter.


2.9 AUDIT. CSC shall maintain complete and accurate accounting records, in accordance with sound accounting practices, to support and document VTB Software licenses distributed in connection with this Agreement. Such records shall be retained for a period of at least two (2) years after the year to which they pertain.


2.10 VTB SOFTWARE STEERING COMMITTEE. SDI and CSC will each appoint two (2) representatives to a steering committee to coordinate information on the development of the VTB Product in accordance with Section 2.1 of the Software Development Agreement of even date herewith.


Section 3
SDI TRADEMARKS


CSC acknowledges that the symbols, trademarks and service marks adopted by SDI or its suppliers to identify the VTB Software, as set forth in SCHEDULE F attached to this Agreement (the "Trademarks"), belong to SDI and its suppliers and that CSC shall have no rights in such Trademarks except as expressly set forth herein. All VTB Software distributed by CSC hereunder and all documentation, associated brochures, packaging and advertising shall display the Trademarks in accordance with SDI's reasonable instruction, samples of all materials that may be distributed by CSC displaying the Trademarks shall be submitted to SDI upon SDI's reasonable request, and the Trademarks shall be used only in a form so approved by SDI.


Section 4
TERM


4.1 INITIAL TERM. This Agreement shall become effective on the Effective Date and shall remain in effect until January 1, 2000. This Agreement may be renewed upon the mutual written agreement of the parties. Each party's remedy for breach of this Agreement shall be an action for damages or injunctive relief; neither party shall be entitled to terminate this Agreement for any reason.


4.2 SURVIVAL. The sublicenses granted to end users pursuant to Section 2.4.1 shall survive the expiration of this Agreement pursuant to their terms. Also, provisions of Sections 2.7 (Ownership), 2.10 (Audit), 4 (Term), 5 (Confidentiality), 9 (Limitation of Liability) and 10 (Miscellaneous) shall survive the expiration of this Agreement.


Section 5
CONFIDENTIALITY


5.1 OBLIGATIONS. Each party (the "receiving party") acknowledges and agrees that any business and technical information PROVIDED TO THE RECEIVING PARTY BY the other party (the "disclosing party") hereunder constitutes the confidential and proprietary information of the disclosing party, and that the receiving party's protection thereof is essential to this Agreement and a condition to the receiving party's use and possession thereof. The receiving party shall retain in strict confidence and not disclose to any third party (except as authorized by this Agreement) without the disclosing party's express written consent, any and all such information. CSC acknowledges and agrees that the VTB Software is confidential and proprietary information of SDI.


5.2 EXCEPTIONS. The receiving party shall be relieved of this obligation of confidentiality to the extent any such information:


(i) was in the public domain at the time it was disclosed or has
become in the public domain through no fault of the receiving party;


(ii) the receiving party can prove was known to the receiving
party, without restriction, at the time of disclosure as shown by the
files of the receiving party in existence at the time of disclosure;


(iii) is disclosed by the receiving party with the prior
written approval of the disclosing party;


(iv) the receiving party can prove was independently developed by
the receiving party without any use of the disclosing party's
confidential information and by employees or other agents of the
receiving party who have not had access to any of the disclosing
party's confidential information; or


(v) becomes known to the receiving party, without restriction,
from a source other than the disclosing party without breach of this
Agreement by the receiving party and otherwise not in violation of the
disclosing party's rights.


5.3 SOURCE CODE PROTECTIONS. Unless as otherwise permitted under this Agreement or another written agreement between CSC and SDI, CSC shall not under any circumstances attempt, or knowingly permit others to attempt, to decompile, decipher, disassemble, reverse engineer or otherwise determine the source code for the VTB Software.


5.4 CONFIDENTIALITY AGREEMENTS. The receiving party, prior to permitting access by any individual to any of the disclosing party's confidential information, shall enter into a confidentiality agreement with each such individual which (i) incorporates the protections and restrictions set forth herein for the disclosing party's confidential information; (ii) provides that the individual's obligations with respect to the disclosing party's confidential information shall continue after termination of the individual's employment, consulting relationship or other relationship with the receiving party; and (iii) provides that the disclosing party is a direct and intended beneficiary of the agreement and entitled to enforce it directly against the individual.


5.5 NOTIFICATION OF SECURITY BREACH. The receiving party agrees to notify the disclosing party promptly in the event of any breach of its security under conditions in which it would appear that the trade secrets contained in the VTB Software were prejudiced or exposed to loss. The receiving party shall, upon request of the disclosing party, take all other reasonable steps necessary to


recover any compromised trade secrets disclosed to or placed in the possession of the receiving party by virtue of this Agreement. The cost of taking such steps shall be borne solely by the receiving party.


5.6 INJUNCTIVE RELIEF. Each receiving party acknowledges that any breach of any of its obligations with respect to confidentiality or use of the disclosing party's confidential information hereunder is likely to cause or threaten irreparable harm to the disclosing party, and, accordingly, the receiving party agrees that in the event of such breach the disclosing party shall be entitled to seek equitable relief to protect its interest therein, including but not limited to preliminary and permanent injunctive relief, as well as money damages.


Section 6
REPRESENTATIONS AND WARRANTIES


6.1 WARRANTY OF TITLE. SDI warrants and represents to CSC that (i) CSC shall acquire good and clear title to the VTB Software, free and clear of all liens and encumbrances, (ii) all materials and services provided hereunder including, without limitation, the VTB Software, are either owned or properly licensed by SDI or are in the public domain and the use thereof by CSC, its repr ...