TiVo 2011 Annual Report Download - page 133

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designee. To provide clear, coordinated and consistent treatment of this settlement for U.S. federal and state income tax purposes,
AT&T and TiVo agree that payments under this Agreement shall constitute royalty income (or expense) for the licensed use of
technology.
4.4. Breach of Payment Obligation . If the Initial Payment, any Installment Payment, or any Additional Payment is not
made in full by AT&T to TiVo on the due date, and has not been paid in full by AT&T within thirty (30) days after notice of such
breach from TiVo, then the entire sum of any and all unpaid payments, and any portion thereof, as set forth in Section 4.1
($164,000,000.00, less the sum of any Installment Payments made by AT&T to TiVo) that are due or will become due shall all be
deemed due and owing and immediately paid in full by AT&T to TiVo. Past due amounts shall be subject to a monthly service charge
of [*] per month of the unpaid balance or the maximum rate allowable by law, whichever is less. In addition to all other sums payable
hereunder, AT&T shall pay all reasonable out-of-pocket expenses incurred by TiVo, including fees and disbursements of counsel, in
connection with collection and other enforcement proceeding resulting therefrom. The foregoing obligation in no way limits any other
rights or remedies available to TiVo.
4.5. Reporting; Audit Right . Within thirty (30) days after the end of each calendar quarter during the Term, AT&T shall
provide to TiVo a report detailing the number of AT&T Subscribers and DVR Subscribers as of the Calculation Date for each month
during such quarter, any Subscriber Acquisition Transactions and the Cumulative Additional Subscribers (in aggregate and for each
Subscriber Acquisition Transaction) and Subscriber Fee Cap as of the Calculation Date for each month during such quarter and the
total Additional Payments due for each month during such quarter. During the Term and for [*] thereafter, TiVo shall have the right,
at its expense, not more than [*] per calendar year, to have an independent certified public accounting firm, review or audit applicable
books and records for the purpose of verifying the reports and payments under this Section 4. Any such audit shall be conducted
during regular business hours, begin upon no less than [*] prior written notice, and shall be subject to reasonable confidentiality
restrictions. AT&T shall keep accurate and complete records to allow such independent certified public accounting firm to determine
such compliance. Any discrepancy in the amounts owed and paid by AT&T (plus interest at the rate set forth in Section 4.4) will be
paid within [*] of the written notice of the results of the audit being delivered by the auditor. If any audit results in a determination that
AT&T has underpaid amounts due hereunder by more than [*] for the time period audited, then in addition to any other rights and
remedies available to TiVo, and in addition to AT&T's obligation to pay such unpaid amounts plus interest, AT&T shall, within thirty
(30) days, reimburse TiVo for all out of pocket costs and expenses incurred in connection with such audit. If any audit results in a
determination that AT&T has overpaid amounts due hereunder, the amount of such overpayment shall be credited against future
payments owed or refunded to AT&T if no additional payments are owed.
Section 5. TERM AND TERMINATION
5.1. Term . The term of this Agreement shall commence on the Effective Date and shall continue in full force and effect
until 11:59 PM (Pacific time) on July 30, 2018 (the
[*]Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.