AMENDED AND RESTATED ENTERPRISE LICENSE AGREEMENT
Agreement No. MDS-ELA-2026-01192
by and between
MERIDIAN DESIGN SYSTEMS, INC.
a Delaware corporation
("Licensor")
and
OPTIWAVE SEMICONDUCTOR CORP.
a Delaware corporation
("Licensee")
Effective Date: February 1, 2026
This Amended and Restated Enterprise License Agreement amends and restates in its entirety that certain Enterprise License Agreement (Agreement No. MDS-ELA-2023-00487), dated as of February 1, 2023, between Licensor and Licensee (the "Original ELA").
EXECUTION VERSION
AMENDED AND RESTATED ENTERPRISE LICENSE AGREEMENT
This Amended and Restated Enterprise License Agreement (this "Agreement"), Agreement No. MDS-ELA-2026-01192, is entered into as of January 15, 2026, effective as of February 1, 2026 (the "Effective Date"), by and between:
Meridian Design Systems, Inc., a corporation organized and existing under the laws of the State of Delaware, with its principal place of business at 2700 Orchard Parkway, San Jose, California 95134 ("Licensor" or "Meridian");
and
Optiwave Semiconductor Corp., a corporation organized and existing under the laws of the State of Delaware, with its principal place of business at 4850 Great America Parkway, Suite 300, Santa Clara, California 95054 ("Licensee" or "OWS").
Licensor and Licensee are each referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, Licensor is in the business of developing, marketing, and licensing electronic design automation ("EDA") software tools, cloud-hosted verification services, and related professional services and support;
WHEREAS, Licensee is a fabless semiconductor design company specializing in high-speed optical transceiver integrated circuits and silicon photonics chiplets for data-center interconnect applications;
WHEREAS, Licensor and Licensee previously entered into that certain Enterprise License Agreement (Agreement No. MDS-ELA-2023-00487), dated as of February 1, 2023, with an initial term of three (3) years expiring on January 31, 2026 (the "Original ELA"), pursuant to which Licensor granted Licensee certain license rights to specified EDA software tools;
WHEREAS, the Parties desire to amend and restate the Original ELA in its entirety in order to, among other things: (i) extend the term of the license arrangement for an additional five (5)-year period; (ii) expand the scope of Licensed Products to include Licensor's Meridian AnalogEdge™ analog/mixed-signal design environment and Meridian PhotonX™ silicon photonics design kit integration tool; (iii) increase the total number of Licensed Seats from 180 to 280; (iv) incorporate the Meridian CloudVerify™ cloud-hosted verification compute environment; and (v) modify certain commercial terms, data security provisions, and other legal terms to reflect the expanded scope of the Parties' relationship;
WHEREAS, upon the Effective Date, this Agreement shall supersede and replace the Original ELA in its entirety, and the Original ELA shall have no further force or effect, except as expressly provided in Section 3.3 hereof; and
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
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ARTICLE 1 — DEFINITIONS
Section 1.1 — Defined Terms
As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not defined in this Section 1.1 shall have the meanings ascribed to them elsewhere in this Agreement or in the Exhibits hereto.
"Affiliate" means, with respect to a Party, any entity that directly or indirectly controls, is controlled by, or is under common control with such Party. For purposes of this definition, "control" means the direct or indirect ownership of more than fifty percent (50%) of the voting securities or equivalent voting interest of such entity, or the power to direct or cause the direction of the management and policies of such entity, whether through ownership of voting securities, by contract, or otherwise.
"Approved EDA Platform List" or "AEPL" means the list of approved EDA tool platforms maintained by a Third-Party Foundry with which Licensee has a process design kit ("PDK") license agreement, which list identifies the EDA tools that have been qualified by such Third-Party Foundry for use in conjunction with such Third-Party Foundry's PDKs.
"Authorized User" means an employee of Licensee or of a Licensee Affiliate, or a bona fide contractor of Licensee permitted to access the Licensed Products in accordance with Section 2.5, who has been assigned or granted access to a Licensed Seat.
"CloudVerify Service" means Licensor's cloud-hosted verification compute environment commercially known as Meridian CloudVerify™, as more fully described in the Data Security and Cloud Services Rider attached hereto as Exhibit D, through which Licensee may access scalable verification compute resources to accelerate formal verification and simulation workloads in conjunction with the Licensed Products.
"Confidential Information" means all non-public information disclosed by or on behalf of one Party (the "Disclosing Party") to the other Party (the "Receiving Party"), whether disclosed orally, in writing, electronically, or by any other means, that (a) is designated as "confidential," "proprietary," or with a similar legend at the time of disclosure, or (b) by its nature or the circumstances of its disclosure would reasonably be understood to be confidential. Without limiting the generality of the foregoing, Confidential Information includes: (i) source code, object code, software architecture, algorithms, data structures, and technical documentation relating to the Licensed Products; (ii) trade secrets and know-how; (iii) product roadmaps, development plans, and feature specifications; (iv) pricing, fee schedules, and other commercial terms of this Agreement; (v) business plans, financial information, projections, and customer lists; (vi) Licensee's design data, netlists, layouts, and other proprietary semiconductor design information; and (vii) the Deposit Materials (as defined herein).
"Brindoval AEPL" means the Approved EDA Platform List maintained by Brindoval Foundry Services Ltd. for use in conjunction with Brindoval's process design kits.
"Brindoval Foundry Services Ltd." or "Brindoval" means Brindoval Foundry Services Ltd., a corporation organized under the laws of the Republic of Singapore, which is a Third-Party Foundry with which Licensee has a PDK license agreement.
"Brindoval PDK License Agreement" means that certain PDK License Agreement between Brindoval Foundry Services Ltd. and Licensee, Reference No. CFS-PDK-2023-US-0034, dated March 15, 2023, as may be amended from time to time.
"Data Security and Cloud Services Rider" means that certain rider setting forth data security requirements, cloud services terms, and related provisions applicable to the CloudVerify Service, attached hereto as Exhibit D and incorporated herein by this reference.
"Deposit Materials" means the source code, build instructions, compilation tools, and related technical documentation deposited by Licensor with the Escrow Agent in accordance with the Technology Escrow Agreement, as more fully described in Exhibit E.
"Effective Date" means February 1, 2026.
"Escrow Agent" means Iron Vault Escrow Services, Inc., a corporation organized under the laws of the State of Delaware, with offices at 1700 Lincoln Street, Suite 2100, Denver, Colorado 80203.
"Fee Schedule" means the fee schedule set forth in Exhibit B, which includes the annual license fees, seat allocation, per-seat pricing for additional seats, and PhotonX™ fee allocation applicable under this Agreement.
"Floating Seat" means a concurrent-use license seat that may be used by any Authorized User on a non-simultaneous basis, up to the maximum number of Floating Seats authorized under this Agreement.
"Initial Term" means the period commencing on the Effective Date and continuing through January 31, 2031, unless this Agreement is earlier terminated in accordance with Article 12.
"Licensed Products" means, collectively, the Licensor software products, tools, and associated documentation listed and described in Exhibit A, including all Updates and Maintenance Releases thereto provided during the Term.
"Licensed Seats" means the aggregate number of Named-User Seats and Floating Seats authorized for Licensee's use under this Agreement, as set forth in Section 2.3 and Exhibit B.
"Licensee Data" means all data, files, design information, and other content that Licensee or its Authorized Users upload, transmit, or otherwise make available through the CloudVerify Service, including without limitation Licensee Output.
"Licensee Output" means Licensee's design data, netlists, layouts, simulation results, verification reports, and other outputs generated by Licensee or its Authorized Users using the Licensed Products.
"Licensor Indemnified Claims" has the meaning set forth in Section 11.1.
"Maintenance Releases" means maintenance releases, patches, bug fixes, error corrections, and minor updates to the Licensed Products that Licensor makes generally available to its enterprise licensees at no additional charge.
"Named-User Seat" means a license seat that is assigned to a specific, identified individual Authorized User and that may be used only by such individual.
"Original ELA" means that certain Enterprise License Agreement, Agreement No. MDS-ELA-2023-00487, dated as of February 1, 2023, between Licensor and Licensee, as in effect immediately prior to the Effective Date of this Agreement.
"Renewal Term" means each successive one (1)-year period following the expiration of the Initial Term for which this Agreement is renewed in accordance with Section 3.2.
"Security Incident" means any unauthorized access to, or breach, acquisition, disclosure, loss, alteration, or destruction of, Licensee Data, or any event that compromises the security, confidentiality, or integrity of Licensee Data held or processed by Licensor or its subprocessors in connection with the CloudVerify Service.
"Service Level Agreement" or "SLA" means the service-level commitments, uptime standards, and service credit provisions applicable to the CloudVerify Service, as set forth in Exhibit C.
"SOC 2 Type II Report" means a System and Organization Controls 2 Type II audit report, prepared by an independent certified public accounting firm in accordance with the standards established by the American Institute of Certified Public Accountants (AICPA), which evaluates the design and operating effectiveness of Licensor's controls relevant to security, availability, processing integrity, confidentiality, and privacy over a specified reporting period.
"Technology Escrow Agreement" means that certain three-party technology escrow agreement among Licensee (as Beneficiary), Licensor (as Depositor), and the Escrow Agent, attached hereto as Exhibit E and incorporated herein by this reference.
"Term" means the Initial Term together with any Renewal Terms, collectively.
"Third-Party Foundry" means any semiconductor foundry or wafer fabrication facility that is not an Affiliate of Licensee and with which Licensee has entered into, or may enter into, a foundry services agreement or PDK license agreement for the manufacture of Licensee's semiconductor devices.
"Updates" means new versions, feature enhancements, and major functional upgrades to the Licensed Products that Licensor makes generally available to its enterprise licensees during the Term as part of its standard maintenance and support program, and not as separately priced products or add-on modules.
Section 1.2 — Rules of Construction
The following rules of construction shall apply to the interpretation of this Agreement:
(a) Headings. The headings and titles of the Articles, Sections, and Exhibits of this Agreement are for convenience of reference only and shall not affect the interpretation or construction of any provision hereof.
(b) Inclusive Language. The word "including" (and correlative words such as "include" and "includes") means "including without limitation" and shall not be construed to limit any general statement that it follows to the specific or similar items or matters immediately following it.
(c) References. Unless the context otherwise requires, all references to Articles, Sections, and Exhibits are references to Articles and Sections of, and Exhibits to, this Agreement. All Exhibits attached hereto are incorporated herein by this reference and made a part of this Agreement.
(d) Singular and Plural. Words in the singular include the plural and vice versa, and words of one gender include the other genders, as the context requires.
(e) Business Days. "Business day" means any day other than a Saturday, Sunday, or a day on which commercial banks in San Francisco, California are authorized or required to close. Any reference to "days" without qualification means calendar days.
(f) Currency. All monetary amounts referenced in this Agreement are denominated in United States dollars (USD) unless otherwise expressly stated.
(g) Statutory References. Any reference to a statute, regulation, or law shall be deemed to include all amendments thereto and all successor statutes, regulations, or laws.
(h) Drafting. This Agreement has been negotiated by the Parties and their respective counsel, and no provision shall be construed against any Party on the basis that such Party was the drafter thereof.
ARTICLE 2 — LICENSE GRANT
Section 2.1 — Grant of License
Subject to the terms and conditions of this Agreement, including Licensee's payment of all fees due under Article 4, Licensor hereby grants to Licensee a non-exclusive, non-transferable (except as set forth in Section 14.4), worldwide license during the Term to install, access, and use the Licensed Products solely for Licensee's internal semiconductor design, verification, and signoff purposes. The foregoing license includes the right to use the Licensed Products for the design, simulation, verification, characterization, and signoff of Licensee's proprietary integrated circuit and silicon photonics designs, and for related research and development activities conducted by or on behalf of Licensee.
The license granted under this Section 2.1 extends to Licensee's Affiliates, provided that (i) such Affiliates comply with all terms and conditions of this Agreement applicable to Licensee, (ii) Licensee shall remain jointly and severally liable for all acts and omissions of its Affiliates in connection with the Licensed Products, and (iii) use by Affiliates shall be counted toward and shall not exceed the aggregate Licensed Seats authorized under this Agreement.
Except as expressly provided in Section 2.5 with respect to authorized contractors, Licensee shall have no right to sublicense, distribute, or otherwise make the Licensed Products available to any third party. All rights not expressly granted herein are reserved by Licensor.
Section 2.2 — Licensed Products
The Licensed Products licensed to Licensee under this Agreement consist of the following Licensor software tools, platforms, and associated documentation:
1. Meridian Marlowe Asset Management™ — Licensor's comprehensive digital integrated circuit design suite, including synthesis, place-and-route, timing analysis, and design-for-test capabilities.
2. Meridian SignalForge™ — Licensor's signal integrity analysis tool, providing electromagnetic simulation, crosstalk analysis, power integrity analysis, and high-speed interconnect modeling.
3. Meridian VerifyPro™ — Licensor's formal verification platform, including equivalence checking, property checking, and coverage analysis, with optional CloudVerify™ cloud-hosted acceleration.
4. Meridian AnalogEdge™ — Licensor's analog and mixed-signal design environment, including schematic capture, SPICE simulation, layout, and design rule checking for analog and mixed-signal circuit design.
5. Meridian PhotonX™ — Licensor's silicon photonics design kit integration tool, enabling the design, simulation, and layout of silicon photonics components and their integration with electronic ICs, including PDK-aware design rule checking and photonic circuit simulation.
Full product descriptions, version specifications, and license types (on-premises, cloud-hosted, or hybrid) for each Licensed Product are set forth in Exhibit A. In addition to the foregoing on-premises Licensed Products, the license includes access to the Meridian CloudVerify™ cloud-hosted verification compute environment as described in Article 7 and Exhibit C.
The license granted hereunder includes all Updates and Maintenance Releases to the Licensed Products that Licensor issues and makes generally available to its enterprise licensees during the Term, in accordance with Article 6.
Section 2.3 — Licensed Seats
The total number of Licensed Seats authorized under this Agreement is two hundred eighty (280), allocated as follows:
• Named-User Seats: Two hundred twenty (220)
• Floating Seats: Sixty (60)
The allocation of Licensed Seats among the Licensed Products is set forth in the Seat Allocation Schedule in Exhibit B (Section B-2). Licensee shall ensure that the total number of concurrent users and assigned seats does not exceed the applicable Licensed Seat counts for each Licensed Product.
Named-User Seats. Each Named-User Seat shall be assigned to an identified individual Authorized User. Only the designated Authorized User may use a Named-User Seat. Licensee may reassign a Named-User Seat from one Authorized User to another, provided that such reassignment occurs no more frequently than once per calendar quarter per seat. Notwithstanding the foregoing, reasonable administrative exceptions to the quarterly reassignment limitation shall be permitted in the case of employee termination, extended leave of absence, or organizational restructuring, provided that Licensee maintains accurate records of all seat assignments and reassignments.
Floating Seats. Floating Seats may be used concurrently by any Authorized User on a non-simultaneous basis, up to the maximum Floating Seat count specified herein for the applicable Licensed Product. Licensee shall implement reasonable license management controls (such as a license server) to ensure that concurrent usage does not exceed the authorized Floating Seat limits.
Section 2.4 — Conditional Activation of PhotonX™ for Third-Party Foundry PDK Use
Licensee may use Meridian PhotonX™ for general internal design purposes, including research, development, evaluation, and design exploration activities, from the Effective Date. The foregoing general-purpose use right is not conditioned upon any Third-Party Foundry AEPL qualification.
However, Licensee shall not use PhotonX™ in conjunction with any process design kits ("PDKs") of a Third-Party Foundry unless and until PhotonX™ has been added to the applicable Approved EDA Platform List maintained by such Third-Party Foundry. The foregoing restriction applies solely to the use of PhotonX™ with Third-Party Foundry PDKs for the purpose of generating production-intent design data (e.g., GDSII, OASIS, or other tapeout-ready design files) intended for manufacture at such Third-Party Foundry.
Without limiting the generality of the foregoing, with respect to Brindoval Foundry Services Ltd. PDKs licensed to Licensee under the Brindoval PDK License Agreement (Reference No. CFS-PDK-2023-US-0034, dated March 15, 2023), Licensee shall not deploy PhotonX™ with Brindoval PDKs for production-intent design activities until Brindoval has qualified PhotonX™ and added PhotonX™ to the Brindoval AEPL. As of the date of execution of this Agreement, Brindoval qualification of PhotonX™ is expected to be completed during the first calendar quarter of 2026 (Q1 2026).
Licensor shall use commercially reasonable efforts to cooperate with Brindoval's qualification activities upon Licensee's reasonable request, including by providing technical documentation, test vectors, and engineering support as reasonably necessary to facilitate the qualification process. Licensor shall designate a qualified technical contact to interface with Brindoval's qualification team and shall respond to Brindoval technical inquiries within five (5) business days. Licensor's obligations under this Section 2.4 shall be subject to Brindoval's cooperation and the terms of any applicable non-disclosure or qualification agreements between Licensor and Brindoval.
Section 2.5 — Authorized Users; Contractors
"Authorized User" means, as defined in Section 1.1, an employee of Licensee or of a Licensee Affiliate who has been assigned or granted access to a Licensed Seat, or a bona fide contractor of Licensee permitted to access the Licensed Products in accordance with this Section 2.5.
Licensee may permit its bona fide contractors (including individual consultants and employees of contract engineering firms) to access the Licensed Products under Named-User Seats or Floating Seats, subject to the following conditions:
(a) Each such contractor must have executed a written confidentiality and intellectual property assignment agreement with Licensee containing protections for Licensor's Confidential Information and intellectual property no less restrictive than those set forth in Article 9 and Article 10 of this Agreement.
(b) Licensee shall maintain a current list of all contractors who have been granted access to the Licensed Products and shall make such list available to Licensor upon reasonable request.
(c) Contractor access shall be counted toward the total Licensed Seat counts authorized under this Agreement and shall not result in the aggregate number of users exceeding the Licensed Seat limits.
(d) Licensee shall remain fully responsible and liable for any breach of this Agreement by any such contractor, and any act or omission of a contractor that would constitute a breach of this Agreement if performed by Licensee shall be deemed a breach by Licensee.
Section 2.6 — Restrictions on Use
Licensee shall not, and shall not permit any Authorized User or third party to, directly or indirectly:
(a) reverse engineer, decompile, disassemble, or otherwise attempt to derive the source code, algorithms, data structures, or underlying ideas or architecture of the Licensed Products, except to the extent that such restriction is expressly prohibited by applicable law (including Section 1201(f) of Title 17 of the United States Code or equivalent provisions under the laws of any applicable jurisdiction);
(b) use the Licensed Products for the benefit of any third party, or operate the Licensed Products as a service bureau, application service provider, or managed service offering for third parties;
(c) remove, alter, obscure, or deface any proprietary notices, labels, trademarks, or copyright notices included in or on the Licensed Products or any copy thereof;
(d) distribute, sublicense, lease, rent, lend, or otherwise make the Licensed Products available to any person or entity other than Authorized Users in accordance with this Agreement;
(e) conduct or disclose the results of any benchmarking, performance testing, or competitive analysis of the Licensed Products without Licensor's prior written consent, which consent may be withheld in Licensor's sole discretion; or
(f) use the Licensed Products in any manner that violates applicable law or regulation, including export control laws and regulations as described in Section 14.13.
ARTICLE 3 — TERM AND RENEWAL
Section 3.1 — Initial Term
The initial term of this Agreement (the "Initial Term") shall commence on the Effective Date (February 1, 2026) and shall continue through January 31, 2031, a period of five (5) years, unless this Agreement is earlier terminated in accordance with Article 12.
Section 3.2 — Renewal
Upon expiration of the Initial Term, this Agreement shall automatically renew for successive one (1)-year periods (each, a "Renewal Term"), unless either Party provides written notice of non-renewal to the other Party at least one hundred eighty (180) days prior to the expiration of the then-current Term (whether the Initial Term or any Renewal Term then in effect).
The license fees for any Renewal Term shall be subject to mutual written agreement between the Parties, to be negotiated in good faith. If the Parties fail to agree on fees for a Renewal Term at least ninety (90) days before the commencement of such Renewal Term, the license fees for the immediately preceding contract year shall apply to such Renewal Term, subject to an annual escalator not to exceed three percent (3%) over the fees in effect for the immediately preceding contract year. The Parties acknowledge that the automatic renewal and fee adjustment provisions of this Section 3.2 are intended to ensure continuity of Licensee's access to the Licensed Products while preserving each Party's right to renegotiate commercial terms at reasonable intervals.
Section 3.3 — Effect on Original ELA
As of the Effective Date, this Agreement amends and restates the Original ELA (Agreement No. MDS-ELA-2023-00487) in its entirety. The Original ELA shall, as of the Effective Date, have no further force or effect, and shall be deemed superseded and replaced by this Agreement in all respects.
Notwithstanding the foregoing, all rights and obligations of the Parties under the Original ELA that accrued prior to the Effective Date shall survive in accordance with their terms, including without limitation: (i) Licensee's obligation to pay any fees accrued and owing under the Original ELA prior to the Effective Date; (ii) indemnification obligations arising from or relating to claims that accrued or arose prior to the Effective Date; and (iii) confidentiality obligations with respect to Confidential Information disclosed under the Original ELA, which shall be governed by the confidentiality provisions of this Agreement from and after the Effective Date. The Parties confirm that, as of the Effective Date, no amounts remain outstanding under the Original ELA and all payment obligations accrued thereunder have been satisfied in full.
ARTICLE 4 — FEES AND PAYMENT
Section 4.1 — License Fees
In consideration of the license rights and services granted under this Agreement, Licensee shall pay to Licensor the annual license fees set forth in the Fee Schedule (Exhibit B, Section B-1) for each contract year of the Initial Term. The annual license fees for each contract year during the Initial Term are as follows:
(a) Year 1 (February 1, 2026 through January 31, 2027): The annual license fee as set forth in Exhibit B, Section B-1, which reflects the negotiated annual amount incorporating the volume discount of not less than fifteen percent (15%) off Licensor's then-current published list prices, as further described in Section 4.3.
(b) Years 2 through 5 (February 1, 2027 through January 31, 2031): The annual license fees for each successive contract year shall be determined in accordance with the annual escalator provisions of Section 4.2, as set forth in the Fee Schedule (Exhibit B, Section B-1).
The Total Contract Value ("TCV") for the entire Initial Term is as set forth in Exhibit B, Section B-1, representing the aggregate of all annual license fees payable by Licensee during the five (5)-year Initial Term.
All annual license fees are due and payable in advance on or before each anniversary of the Effective Date (i.e., on or before February 1 of each contract year). The Year 1 annual license fee is due and payable on or before the Effective Date.
Section 4.2 — Annual Escalator
The annual license fees for Years 2 through 5 of the Initial Term shall increase by a fixed annual escalator of no more than three percent (3%) over the annual license fee for the immediately preceding contract year, as specified in the Fee Schedule (Exhibit B, Section B-1). The specific escalator percentage applicable to each contract year is set forth in Exhibit B and has been agreed upon by the Parties as of the date of execution of this Agreement.
Section 4.3 — Volume discount
Licensor has applied a volume discount of not less than fifteen percent (15%) off Licensor's then-current published list prices for all Licensed Products, as reflected in the Fee Schedule (Exhibit B, Section B-1). The volume discount has been calculated based on the aggregate number of Licensed Seats and the full scope of Licensed Products licensed under this Agreement.
The volume discount set forth in this Section 4.3 is contingent upon Licensee maintaining a minimum of two hundred fifty (250) total Licensed Seats (combined Named-User Seats and Floating Seats) throughout the Term. In the event that Licensee's total Licensed Seat count falls below 250 at any time during the Term (other than as a result of a temporary reduction during a license true-up period not exceeding thirty (30) days), Licensor shall have the right to adjust the applicable license fees prospectively to reflect the then-applicable volume discount tier, upon thirty (30) days' prior written notice to Licensee.
Section 4.4 — Payment Terms
All invoices issued by Licensor under this Agreement shall be payable by Licensee within thirty (30) days of the date of such invoice. Licensor shall issue invoices at least thirty (30) days in advance of each annual fee due date.
All payments shall be made in United States dollars by wire transfer of immediately available funds to Licensor's designated bank account, the details of which Licensor shall provide to Licensee in writing. Licensee shall be responsible for all wire transfer fees charged by Licensee's bank.
Any amount not paid when due shall accrue interest from the due date until paid at a rate equal to the lesser of (a) one and one-half percent (1.5%) per month (or the daily equivalent thereof) and (b) the maximum rate permitted by applicable law. The accrual of interest on late payments shall not limit or waive any other rights or remedies available to Licensor under this Agreement or at law.
Section 4.5 — Taxes
All fees and other amounts payable under this Agreement are exclusive of all sales, use, value-added, goods and services, withholding, and similar taxes, duties, levies, and governmental charges (collectively, "Taxes"). Licensee shall be responsible for and shall pay all applicable Taxes arising from or relating to the transactions contemplated by this Agreement, other than taxes imposed on Licensor's net income, net worth, or capital. If Licensee is required by applicable law to withhold any Taxes from payments due to Licensor, Licensee shall gross up the payment to Licensor so that Licensor receives the full amount that would have been received absent such withholding, unless Licensor provides Licensee with a valid exemption certificate or other documentation evidencing Licensor's entitlement to an exemption from or reduction of such withholding. Licensor shall provide Licensee with such tax documentation as Licensee may reasonably request to support Licensee's compliance with applicable tax reporting and withholding obligations.
Section 4.6 — Fee Abatement for PhotonX™ AEPL Delay
If Meridian PhotonX™ has not been added to the Brindoval AEPL by June 30, 2026, Licensee shall be entitled to a pro rata fee abatement for the PhotonX™ component of the license fees for each full calendar month of delay beyond June 30, 2026, until the earlier of: (a) the date on which PhotonX™ is qualified and added to the Brindoval AEPL, and (b) the date on which Licensee provides written notice to Licensor of Licensee's election to waive the fee abatement.
The calculation methodology for the fee abatement and the allocation of aggregate annual license fees attributable to PhotonX™ are set forth in Exhibit B, Section B-4. Fee abatements shall be applied as credits against future license fee invoices. If no future invoices remain against which to apply such credits, Licensor shall refund the credited amounts to Licensee within thirty (30) days following the end of the applicable contract year.
For the avoidance of doubt, the fee abatement under this Section 4.6 applies solely to the PhotonX™ component of the license fees and does not affect Licensee's obligation to pay the license fees attributable to the other Licensed Products. Licensee's right to a fee abatement under this Section 4.6 is without prejudice to any other rights or remedies Licensee may have under this Agreement.
Section 4.7 — Most Favored Customer
Licensor represents and warrants that, as of the Effective Date, the per-seat pricing provided to Licensee under this Agreement is no less favorable than the per-seat pricing provided by Licensor to any other similarly situated licensee with comparable Licensed Seat counts (within twenty percent (20%) of Licensee's total Licensed Seats) and comparable Licensed Product scope. If, during the Term, Licensor enters into an enterprise license agreement with another licensee on terms that provide per-seat pricing more favorable than the per-seat pricing provided to Licensee under comparable circumstances, Licensor shall, upon Licensee's written request and verification of the more favorable terms, adjust Licensee's per-seat pricing prospectively to match the more favorable pricing, effective as of the first day of the next contract year following Licensee's request.
ARTICLE 5 — DELIVERY AND INSTALLATION
Section 5.1 — Delivery
Licensor shall deliver the Licensed Products to Licensee electronically via Licensor's secure download portal within ten (10) business days following the Effective Date. Delivery shall include the most current generally available release version of each Licensed Product, together with all associated documentation, license keys, and activation codes.
With respect to Meridian Marlowe Asset Management™, Meridian SignalForge™, and Meridian VerifyPro™, which were previously licensed to Licensee under the Original ELA and are currently installed at Licensee's facilities, Licensor shall ensure that existing installations continue without interruption. Licensor shall update all license keys, entitlement certificates, and license server configurations to reflect the expanded Licensed Seat counts, the extended Term, and any version upgrades applicable as of the Effective Date.
With respect to Meridian AnalogEdge™ and Meridian PhotonX™, which are being newly licensed to Licensee under this Agreement, Licensor shall deliver the complete installation packages, documentation, and license keys via the secure download portal within the ten (10) business day delivery period specified above.
Section 5.2 — Installation Support
Licensor shall provide reasonable installation and configuration support at no additional charge for the initial deployment of Meridian AnalogEdge™ and Meridian PhotonX™ at Licensee's facilities. Such support shall include remote assistance with installation, license server configuration, initial setup and configuration of design environments, and basic user training to facilitate Licensee's adoption of the newly licensed tools. Licensor shall make qualified technical personnel available for up to a combined total of forty (40) hours of remote installation and configuration support for AnalogEdge™ and PhotonX™.
If Licensee requests on-site installation support, Licensor shall provide such on-site support at Licensor's then-current professional services rates, subject to mutual agreement on scheduling and scope. Travel and related expenses for on-site support shall be borne by Licensee.
ARTICLE 6 — MAINTENANCE AND SUPPORT
Section 6.1 — Maintenance Releases and Updates
During the Term and subject to Licensee's continued compliance with the terms of this Agreement (including timely payment of all fees), Licensor shall provide to Licensee all Maintenance Releases and Updates to the Licensed Products at no additional charge.
"Updates" include new versions and feature enhancements to the Licensed Products that Licensor makes generally available to its enterprise licensees as part of its standard maintenance and support program during the Term. For the avoidance of doubt, Updates do not include separately priced new products, entirely new product lines, or optional premium add-on modules that Licensor may develop and offer during the Term. If Licensor introduces new products or premium add-on modules during the Term, such products or modules may be licensed by Licensee under a separate agreement or amendment at separately negotiated fees.
Licensor shall provide Licensee with advance notice of upcoming Updates, including release notes describing new features, enhancements, bug fixes, and any known issues. Licensor shall use commercially reasonable efforts to maintain backward compatibility with prior versions of the Licensed Products, and shall provide Licensee with reasonable advance notice and documentation in the event that an Update includes material changes to functionality, file formats, or application programming interfaces.
Section 6.2 — Technical Support
Licensor shall provide Licensee with Tier 1 and Tier 2 technical support for the Licensed Products during the Term, as follows:
Support Hours. Technical support shall be available during Licensor's standard business hours, 8:00 AM to 6:00 PM Pacific Time, Monday through Friday, excluding holidays observed by Licensor (Licensor shall provide Licensee with its annual holiday schedule at the beginning of each calendar year).
Severity Classification and Response Times. Support requests shall be classified by severity as follows:
(a) Critical (Severity 1): A Licensed Product is completely inoperable or a critical function is unavailable, resulting in a total work stoppage for one or more Authorized Users with no available workaround. Licensor shall provide an initial response within four (4) hours of receipt of a Severity 1 support request and shall provide continuous effort toward resolution until the issue is resolved or a reasonable workaround is identified.
(b) High (Severity 2): A Licensed Product function is significantly impaired or degraded, causing substantial productivity loss but not a total work stoppage. Licensor shall provide an initial response within eight (8) hours of receipt of a Severity 2 support request.
(c) Medium (Severity 3): A Licensed Product function exhibits a defect or unexpected behavior that causes minor productivity impact, with a workaround available. Licensor shall provide an initial response within two (2) business days of receipt of a Severity 3 support request.
(d) Low (Severity 4): General inquiries, enhancement requests, or cosmetic issues. Licensor shall provide an initial response within five (5) business days of receipt of a Severity 4 support request.
Designated Contacts. Each Party shall designate a primary and secondary technical support contact. Licensee may designate up to five (5) Authorized Support Contacts who are authorized to submit support requests to Licensor on behalf of Licensee. Licensor shall designate a named Technical Account Manager who will serve as Licensee's primary point of contact for support escalations and periodic account reviews.
Section 6.3 — Professional Services
Additional professional services, including without limitation custom flow development, advanced training courses, methodology consulting, design environment optimization, and on-site engineering assistance, shall be available to Licensee upon request under separate statements of work at Licensor's then-current professional services rates. Each statement of work shall specify the scope of services, deliverables, schedule, fees, and acceptance criteria, and shall be executed by authorized representatives of both Parties. Professional services shall be governed by the terms of this Agreement except as expressly modified in the applicable statement of work.
ARTICLE 7 — CLOUD SERVICES AND SERVICE LEVEL AGREEMENT
Section 7.1 — CloudVerify™ Service
During the Term, Licensor shall make the Meridian CloudVerify™ cloud-hosted verification compute environment available to Licensee. The CloudVerify Service provides Licensee with access to scalable, on-demand compute resources for accelerating formal verification, equivalence checking, and simulation workloads in conjunction with the VerifyPro™ Licensed Product.
Access to the CloudVerify Service is tied to Licensee's VerifyPro™ Licensed Seats, as set forth in Exhibit B, Section B-2. The CloudVerify Service is subject to the SLA set forth in Exhibit C and the Data Security and Cloud Services Rider set forth in Exhibit D, each of which is incorporated herein by this reference.
Licensee's use of the CloudVerify Service shall be governed by Licensor's acceptable use policies and the technical requirements communicated by Licensor from time to time, provided that any material changes to such policies or requirements shall be communicated to Licensee at least thirty (30) days in advance and shall not materially diminish the functionality or performance of the CloudVerify Service.
Section 7.2 — Service Level Commitment
Licensor commits to maintaining a monthly uptime percentage of not less than ninety-nine and one-half percent (99.5%) for the CloudVerify Service, measured in accordance with the methodology set forth in Exhibit C, Section C-1.
In the event that Licensor fails to meet the SLA uptime commitment in any calendar month, Licensee shall be entitled to service credits as follows:
(a) Monthly Uptime of 99.0% or above but below 99.5%: Service credit equal to five percent (5%) of the monthly CloudVerify fees for the affected month.
(b) Monthly Uptime of 98.0% or above but below 99.0%: Service credit equal to ten percent (10%) of the monthly CloudVerify fees for the affected month.
(c) Monthly Uptime below 98.0%: Service credit equal to twenty-five percent (25%) of the monthly CloudVerify fees for the affected month.
The maximum aggregate service credits payable by Licensor for any single calendar month shall not exceed twenty-five percent (25%) of the monthly CloudVerify fees for such month. Service credits shall be applied against future invoices. Service credits constitute Licensee's sole and exclusive remedy for Licensor's failure to meet the SLA uptime commitment, except as set forth in the following paragraph.
Notwithstanding the foregoing, if the monthly uptime percentage for the CloudVerify Service falls below ninety-five percent (95.0%) in any three (3) months during any rolling twelve (12)-month period, Licensee shall have the right, upon thirty (30) days' written notice to Licensor, to terminate the CloudVerify Service component of this Agreement and receive a pro rata refund of any prepaid CloudVerify fees attributable to the unused portion of the then-current contract year. Such termination shall not affect Licensee's license to the on-premises Licensed Products or any other provisions of this Agreement.
Section 7.3 — Data Security Requirements
Licensor's operation of the CloudVerify Service shall comply with the data security requirements set forth in the Data Security and Cloud Services Rider attached hereto as Exhibit D, which includes, without limitation, the following requirements:
(a) SOC 2 Type II Compliance. Licensor shall maintain a current SOC 2 Type II Report. Licensor's most recent SOC 2 Type II Report is dated June 30, 2025. Licensor shall renew its SOC 2 Type II certification on an annual basis and shall provide updated SOC 2 Type II Reports to Licensee within thirty (30) days of issuance.
(b) Encryption. All Licensee Data shall be encrypted at rest using AES-256 encryption and in transit using Transport Layer Security (TLS) version 1.3 or higher.
(c) Data Localization. All Licensee Data shall be processed and stored within data centers located in the United States. Licensor shall not transfer, process, or store Licensee Data outside the United States without Licensee's prior written consent.
(d) Security Incident Notification. Licensor shall notify Licensee of any Security Incident within seventy-two (72) hours of discovery of such Security Incident.
(e) Penetration Testing. Licensor shall conduct annual penetration testing by a qualified independent third-party assessor and shall make summary results available to Licensee upon request.
(f) Updated Reports. Licensor shall provide updated SOC 2 Type II Reports and penetration testing summaries to Licensee annually within thirty (30) days of issuance.
Additional data security requirements are set forth in Exhibit D, including provisions regarding access controls, incident response procedures, subprocessor management, and data return and deletion obligations.
ARTICLE 8 — AUDIT RIGHTS
Section 8.1 — Licensor's Audit Right
Licensor shall have the right to conduct a compliance audit of Licensee's use of the Licensed Products to verify Licensee's compliance with the Licensed Seat limitations, scope of use restrictions, and other terms of this Agreement. The following conditions shall apply to any such audit:
(a) Frequency. Licensor may conduct a maximum of one (1) audit per calendar year, and in no event more than one (1) audit during any rolling twelve (12)-month period.
(b) Notice. Licensor shall provide Licensee with at least thirty (30) business days' prior written notice of any proposed audit, specifying the general scope of the audit and the proposed dates for commencement.
(c) Location and Timing. The audit shall be conducted during Licensee's normal business hours at Licensee's principal place of business located at 4850 Great America Parkway, Suite 300, Santa Clara, California 95054, or at such other Licensee facility as the Parties may mutually agree.
(d) Auditor. The audit may be conducted by Licensor's internal audit personnel or by an independent third-party auditor mutually agreed upon by the Parties. Any auditor conducting the audit must execute a confidentiality agreement in a form reasonably acceptable to Licensee prior to commencing the audit, and shall be bound by obligations of confidentiality no less restrictive than those set forth in Article 9 of this Agreement.
Section 8.2 — Audit Procedures
The scope of any audit conducted under Section 8.1 shall be limited to records, systems, and information reasonably necessary to verify Licensed Seat usage (including Named-User Seat assignments and Floating Seat concurrent-use logs) and compliance with the Licensed Product usage restrictions set forth in this Agreement. The audit shall not extend to Licensee's proprietary design data, financial records (other than records necessary to verify seat counts), or information unrelated to Licensee's use of the Licensed Products.