CROSS LICENSE AGREEMENT 　 %%%%%%%%AGREEMENT made as of this ______ day of __________, 199__ by and between X Corporation (together with its Subsidiaries, hereinafter called "X"), a corporation organized and existing under the laws of Japan, having an office at ______ _______________________________, Tokyo, Japan, and Y Corporation (together with its Subsidiaries, hereinafter called "Y"), a corporation organized and existing under the laws of the State of Delaware, U.S.A., having an office at _______________________ _________________________________ U.S.A., WITNESSETH: %%%%%WHEREAS, each party hereto (as a "GRANTEE" herein) desires to obtain from the other party (as a "GRANTOR" herein) a license under Patent Rights and Technical Information and Know-How to manufacture, use and sell the Licensed Products and obtain the benefit of technical assistance for the use of Technical Information and Know-How and GRANTOR is willing to grant and furnish all of the foregoing upon the terms and conditions hereinafter contained, %%%%%NOW, THEREFORE, in consideration of the mutual agreements herein set forth, the parties hereto mutually agree as follows: %%%%%1. Definitions %%%%%%%%As used herein, the following terms shall have the following meanings: %%%%%%%%(a) "Licensed Products" shall mean _________________ and its applications or any component portion thereof manufactured using the Patent Rights and/or Technical Information and Know-How. %%%%%%%%(b) "Net Sales Value" shall mean the gross invoice price billed by GRANTEE for the sale of Licensed Products, less allowances for returns and sales tax. It is understood that if Patent Rights or Technical Information and Know-How is used only with respect to certain component portion of a machine "Net Sales Value" shall be determined with respect to such component portion and not with respect to the machine as a whole. %%%%%%%%(c) "Patent Rights" shall mean all inventions claimed in patent applications or patents of GRANTOR. %%%%%%%%(d) "Technical Information and Know-How" shall mean secret processes, software, formulae, specifications, data, drawings, manuals and related proprietary technical information and know-how, except Patent Rights, which GRANTOR has held now or hereafter during the term of this Agreement and which GRANTOR employs or intends to employ in the commercial manufacture, use or sale of any Licensed Product during the term of this Agreement. %%%%%%%%(e) "Territory" shall mean worldwide. %%%%%%%%(f) "Effective Date" shall mean the date of execution hereof by both parties. %%%%%%%%(g) "Subsidiary" shall mean any company directly or indirectly controlled by X or Y, as the case may be. %%%%%2. Grant of License and Disclosure %%%%%%%%(a) GRANTOR hereby grants to GRANTEE a license in the Territory to use Patent Rights and Technical Information and Know-How in manufacture, use and sale of Licensed Products. %%%%%%%%(b) Promptly following the Effective Date of this Agreement, GRANTOR will disclose to GRANTEE in reasonable detail all inventions included in Patent Rights and Technical Information and Know-How possessed by GRANTOR on the Effective Date, which directly relates to GRANTEE's manufacture, use or sale of Licensed Products. From time to time during the term of this Agreement, GRANTOR will also disclose to GRANTEE in reasonable detail all inventions hereafter included in Patent Rights and Technical Information and Know-How hereafter possessed by GRANTOR, which in the opinion of GRANTOR directly relates to manufacture, use or sale of Licensed Products. %%%%%3. Royalties %%%%%%%%In consideration of the rights and licenses granted pursuant to Article 2 hereof, GRANTEE agrees to pay the royalties to GRANTOR as follows: (i) If Patent Rights and/or Technical Information and Know-How are used in the Licensed Products itself and not in the manufacturing process thereof: 3 Net Sales Value x ___ 100 (ii) If Patents Rights and/or Technical Information and Know-How are used in the manufacturing process of Licensed Products, the royalties shall be calculated based upon a formula to be separately agreed between the parties hereto. %%%%%4. Payment of Royalties %%%%%%%%Within forty-five (45) days after the end of each six (6) month period occurring in whole or in part during the term of this Agreement, GRANTEE shall report to GRANTOR in writing whether or not any royalties have accrued to GRANTOR under Article 3 hereof during such six (6) month period and, if so, such report shall include a statement showing a computation in reasonable detail of the royalties so accruing and shall be accompanied by payment in full of all amounts therein shown to be due. %%%%%5. Currency and Taxes %%%%%%%%(a) Royalties shall be paid in U.S. Dollars and the conversion rate shall be the actual rate at which U.S. Dollars can be purchased at the time royalties are paid hereunder. %%%%%%%%(b) All taxes and charges which may be imposed in the country of the payor on the amounts paid by GRANTEE to GRANTOR pursuant to Article 4 hereof other than taxes to be withheld from royalties shall be assumed by GRANTEE. GRANTEE shall deliver to GRANTOR the original or true copy of the receipt covering the payment of withholding taxes referred to above. All other taxes, duties, fees and imposts of any or every kind which may be levied by any taxing authority in the country of the payor by reason of the execution or performance of this Agreement shall be borne and paid by GRANTEE without deduction from the amounts payable to GRANTOR under this Agreement. %%%%%6. Records %%%%%%%%GRANTEE shall keep true books of account containing an accurate record of all data necessary for the determination of the amounts payable hereunder and shall from time to time permit GRANTOR, by its duly authorized representatives, to examine at the expense of GRANTOR such books of account of GRANTEE for the purpose of determining the correctness or incorrectness of any of the statements to be rendered by GRANTEE pursuant to Article 4 hereof. %%%%%7. Training at GRANTOR's Facilities %%%%%%%%(a) During the term of this Agreement, GRANTOR will, upon the written request by GRANTEE, provide training and instruction for personnel of GRANTEE in the use of the Technical Information and Know-How in the manufacture, use and marketing of Licensed Products at plants and other facilities of GRANTOR, provided that the time, place and duration of such training and instruction and the number of GRANTEE's employees to be instructed at any one time shall be as mutually agreed upon by the parties. The salaries, maintenance and travel expenses of any such employees of GRANTEE so assigned for training purposes will be borne by GRANTEE. %%%%%%%%(b) During any visits by GRANTEE's employees to GRANTOR's facilities pursuant to paragraph (a) above, such employees shall observe such safety and other regulations as have been established by GRANTOR at the visited facilities. GRANTEE does hereby indemnify and hold harmless GRANTOR from and against any and all liability of any kind or nature whatsoever relating to (i) injuries to or death of any such employee of GRANTEE during any such visit to any facility of GRANTOR and (ii) injuries to or death of third persons due to the negligence of any such employee of GRANTEE during any such visit. %%%%%8. Training at GRANTEE's Facilities %%%%%%%%(a) Upon the written request of GRANTEE, GRANTOR shall after the Effective Date hereof furnish at GRANTEE's facilities designated by the GRANTEE services of engineering, production or other technical representatives familiar with the production and use of Licensed Products to train and instruct GRANTEE in the manufacture and use thereof, or to consult generally with GRANTEE concerning its Licensed Products business, the services being furnished by such number of representatives and for such period or periods of time as GRANTOR may deem necessary. GRANTEE shall pay to GRANTOR a reasonable amount of compensation to be separately agreed between the parties hereto for the services of such representative together with the latter's reasonable living and travelling expenses during the time he shall be engaged in such work to be computed from the time the representative leaves his usual place of employment until his return thereto based on travel by air. %%%%%%%%(b) GRANTEE shall secure at its own expense such governmental authorization as may be required for GRANTOR's representatives to enter and remain in the country where GRANTEE's facilities are located in order to train and instruct personnel of GRANTEE as provided in this Article 8. %%%%%9. Improvements %%%%%%%%The following provisions shall apply if, as a result of the disclosures made by GRANTOR hereunder, GRANTEE makes developments relating to Licensed Products: %%%%%%%%(i) GRANTEE shall, during the term of this Agreement and without the payment of compensation of any nature, promptly disclose to and permit GRANTOR to use all secret processes, software, formulae, specifications, data, drawings, manuals and related proprietary technical information and know-how, if any, developed or acquired by GRANTEE and useful in the manufacture, use or sale of Licensed Products. %%%%%%%%(ii) GRANTEE shall promptly disclose to GRANTOR and grant GRANTOR a royalty free nonexclusive license, with the right to sublicense, to practice worldwide, all inventions, whether patented, patentable or unpatentable, owned or controlled by GRANTEE during the term of this Agreement, which relate to Licensed Products or the manufacture, use or sale thereof. %%%%%10. Third-party Restrictions on Disclosure %%%%%%%%Anything provided in this Agreement to the contrary notwithstanding, GRANTOR shall not be obligated to make any disclosure pursuant to this Agreement of any Technical Information and Know-How in which any third party may have an interest or right, or to file or prosecute any patent application, procure any patent or grant any license hereunder with respect to such invention, if GRANTOR is prohibited by agreement with such third party from making such disclosure or from granting a license in the Territory with respect to such invention or, unless GRANTEE shall first agree to make reimbursement therefor, if GRANTOR would be obligated to pay such third party any compensation or other consideration by reason of making such disclosure or granting such license in the Territory. GRANTOR shall promptly disclose to GRANTEE any matter coming within the scope of this Article 10. %%%%%11. Secrecy %%%%%%%%(a) During the term of this Agreement and a period of ten (10) years thereafter, GRANTEE shall not use except as provided in Article 2 hereof, and shall not disclose to any third party (other than an employee whose duties require the possession thereof) any and all Technical Information and Know- How disclosed to GRANTEE hereunder. Provided, however, that information specified below are excluded for the purpose of this Agreement: (i) Information which, at the time of the disclosure, was previously made public; (ii) Information which is made public after the disclosure unless such publication constitutes a breach of this Agreement; (iii) Information which, prior to disclosure to the GRANTEE, had already been in possession of the GRANTEE; and (iv) Information which, subsequent to disclosure, was obtained by the GRANTEE from a third person who had been lawfully in possession of such information and had not violated any contractual, legal or fiduciary obligation to the GRANTOR with respect to such information. %%%%%%%%(b) All Technical Information and Know-How and materials delivered by the GRANTOR to the GRANTEE including but not limited to drawings, specifications, descriptions, data and samples pertaining to the Technical Information and Know-How shall remain the property of the GRANTOR and the GRANTEE shall, at the request of the GRANTOR, return all said materials and copies thereof (if any) to the GRANTOR promptly. GRANTEE shall not copy such materials without a prior written consent of the GRANTOR. %%%%%%%%(c) Employees of GRANTEE to whom Technical Information and Know-How is to be disclosed pursuant hereto shall, prior to the disclosure of the Technical Information and Know-How, execute a confidentiality agreement which is sufficient to ensure that the Technical Information and Know-How shall be maintained strictly confidential against any third person. Such confidentiality agreement shall have, inter alia, a provision to the effect that the employee to whom the Technical Information and Know-How was disclosed shall maintain the Technical Information and Know-How strictly confidential during his employment with the GRANTEE and for three (3) years thereafter. %%%%%12. Prosecution and Maintenance of Patent Rights %%%%%%%%(a) GRANTOR shall cause each of the patents included in the Patent Rights to be kept in force and shall cause diligent prosecution of each of the applications for patent included in the Patent Rights. %%%%%%%%(b) GRANTEE shall refrain from contesting, directly or indirectly in the name of a third party, the validity of any patent or patent application included in the Patent Rights. %%%%%13. Term %%%%%%%%The term of this Agreement shall commence on the Effective Date and continue thereafter until terminated pursuant to other provisions hereof. All rights and obligations of the parties which have accrued on or prior to any termination and the provisions of Article 11 hereof shall survive such termination or expiration. %%%%%14. Default %%%%%%%%If either party hereto shall fail to perform or fulfill, in the time and manner herein provided, any obligation or condition herein required to be performed or fulfilled by such party, and if such default shall continue for sixty (60) days after written notice thereof from the nondefaulting party, then the nondefaulting party shall have the right to terminate this Agreement by written notice of termination to the defaulting party. Any termination of this Agreement pursuant to this Article 14 shall be in addition, and shall not be exclusive of or prejudicial to, any other rights or remedies, at law or in equity, which the nondefaulting party may have on account of the default of the other party. %%%%%15. Change in Ownership %%%%%%%%X shall have the right to terminate this Agreement by giving written notice of termination to Y at any time after the transfer, by operation of law or otherwise, of fifty percent (50%) or more of the voting stock of Y owned by X. %%%%%16. Force Majeure %%%%%%%%Either party's obligations under this Agreement are subject to governmental laws, orders, rules, and regulations, strikes or other labor disputes (whether or not within the party's power to settle the same), shortage of manpower, inability to obtain or delay in obtaining transportation facilities and other similar or different contingencies beyond the reasonable control of either party. %%%%%17. Severability %%%%%%%%Should any part of this Agreement for any reason be declared invalid, such decision shall not affect the validity of any remaining portion, and such remaining portion shall continue in full force and effect as if this Agreement had been executed with the invalid portion eliminated. %%%%%18. Governing Law and Arbitration %%%%%%%%(a) The provisions of this Agreement shall be construed, and the performance thereof shall be enforced, in accordance with the laws of Japan. %%%%%%%%(b) All disputes that may arise under or in relation to this Agreement shall be submitted to arbitration pursuant to the Japan-American Arbitration Agreement of September 16, 1952 by which each party hereto is bound. The place of arbitration shall be Tokyo, Japan if the party against whom the arbitration was initiated (the "Respondent") is X and _________, _________, U.S.A. if the Respondent is Y. The arbitration proceedings, all documents and testimony, written or oral, made in connection therewith, and the arbitration award shall be confidential. %%%%%19. Notice %%%%%%%%Any and all notices given by either party to the other party shall be in writing, by telex or registered airmail, and shall be deemed served on the date actually received by the other party. Such notices shall be addressed respectively: %%%%%%%%%%As to X: X Corporation %%%%%%%%%%%%%%%______________________________________ %%%%%%%%%%%%%%%Tokyo, Japan %%%%%%%%%%As to Y: Y Corporation %%%%%%%%%%%%%%%______________________________________ %%%%%%%%%%%%%%%U.S.A. or to any other address which such party may have subsequently communicated to the other party in writing. %%%%%20. Modification %%%%%%%%No change in, modification or waiver of any of the terms or conditions of this Agreement shall be effective unless agreed to in writing and signed by a duly authorized representative of each of the parties. %%%%%IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. %%%%%%%%%%%%%%%X Corporation %%%%%%%%%%%%%%%By _________________________ %%%%%%%%%%%%%%%Y Corporation %%%%%%%%%%%%%%%By _________________________