Tseng Labs Inc – ‘8-K’ for 12/16/97 – EX-10.1

As of:  Thursday, 2/5/98   ·   For:  12/16/97   ·   Accession #:  950116-98-211   ·   File #:  0-13502

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Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                         4     12K 
 2: EX-10.1     Memorandum of Agreement                               20     47K 

EX-10.1   —   Memorandum of Agreement

EX-10.1
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  EXHIBIT 10.1

MEMORANDUM OF AGREEMENT made the 16TH day of December, 1997.

B E T W E E N:                                                                  

      TSENG LABS, INC., TSENG INTERNATIONAL LABS, INC.
               (a Nevada corporation) and TSENG INTERNATIONAL LABS, INC.
(a Delaware corporation)                  

                 (collectively the "Vendor")

                 OF THE FIRST PART

- and -                                   

ATI RESEARCH, INC.                        

                 (the "Purchaser")

                        OF THE SECOND PART

              WHEREAS the Vendor has carried on the business of graphics
chip design (the "Business");                                                   

               AND WHEREAS the Vendor has decided to cease carrying on the
Business and to sell, and the Purchaser has decided to purchase, certain assets 
used by the Vendor in respect of the Business;                                  

                 NOW THEREFORE in consideration of the mutual covenants herein
contained and of the sum of $2.00 now paid by each of the parties hereto to the 
other and of other good and valuable consideration, the receipt and sufficiency 
whereof each of the parties hereto hereby acknowledges, the parties hereto      
covenant and agree as follows:                                                  

l. Purchase and Sale of Assets: The Purchaser hereby purchases and the Vendor   
hereby sells the following assets for the consideration and subject to the terms
and conditions hereinafter set forth:                                           

         (a)      selected software licenses used by the Vendor in the Business,
           as specified on Schedule A, provided that such software
              license is assignable to the Purchaser and any maintenance
                  contract in respect of such software license is up to date, in
                 good standing and being performed by the maintenance provider
(the "Software Licenses");                  

      (b)      selected fixed assets and equipment used in connection with
               the Business, as specified on Schedule B (the "Equipment");

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        (c)      selected facilities assets, including furniture and fixtures,
                  used in connection with the Business, as specified on Schedule
C (the "Facilities");                       

(d)      a perpetual, fully paid, royalty free, assignable and
                  transferable license in the form attached as Schedule D of all
            tangible and intangible intellectual property, including
              patents, trade secrets and proprietary process technology,
                owned, licensed (provided it is transferable) or used by the
             Vendor in connection with the Business (the "Intellectual
Property"), provided that:                  

               (i)      if the Purchaser files a patent for any inventions
                          arising from the Intellectual Property the resulting
                          issued patent will be solely owned by the Purchaser;
and                       

          (ii)      the Vendor will assign any of the Intellectual
                        Property or other rights to the Purchaser that are
                   necessary for the Purchaser to perfect and/or
   complete such patent filings;

(collectively the "Purchased Assets").                                          

2. Closing: The purchase and sale of the Purchased Assets shall be completed at 
a closing on the date hereof (the "Closing Date").                              

3. Vendor's Representations and Warranties: The Vendor represents and warrants  
to the Purchaser that:                                                          

   (a)      The Vendor has been duly incorporated and organized as a
         corporation under the laws of Utah and is a valid and
             subsisting corporation in good standing and to the extent
            required has all necessary powers, licenses, permits and
               authority (all of which are in full force and effect and in
                  good standing) to own the Purchased Assets and to complete the
transactions provided for in this agreement.

    (b)      The Vendor has good and marketable title to the Purchased
       Assets free and clear of any claim, lien, charge or
                  encumbrance whatever, except for any usual ownership rights of
          the owners of the software that are the subject of the
Software Licenses.                          

(c)      Except as set out on Schedule E attached hereto or as
                disclosed in the most recent annual and/or interim financial
                statements of the Vendor (the "Financial Statements"), there
                 has not occurred since the date of such Financial Statements:

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                 (i)      any material adverse change in the Purchased Assets;

              (ii)     any damage, destruction or loss having a material
                adverse effect on the Purchased Assets; or

             (iii)    any condition or event or a threat thereof which
                        does, or reasonably might, have a material adverse
     affect on the Purchased Assets.

(d)      Except as set out on Schedule E attached hereto or as
             disclosed in the Financial Statements, the Vendor has not
           directly or indirectly since the date of such Financial
Statements:                                 

         (i)      subjected any of the Purchased Assets to any
                         mortgage, lien, pledge, conditional sales contract,
                       lease, encumbrance, charge or similar limitation;

               (ii)     acquired, sold or otherwise transferred any of the
                           Purchased Assets other than in the ordinary course of
business;                 

               (iii)    entered into any agreement regarding the Purchased
                    Assets not in the ordinary course of business;

              (iv)     modified, amended, or terminated any agreement or
                         waived or released any material right regarding the
                           Purchased Assets other than in the ordinary course of
business;                 

                 (v)      except in the ordinary course of business, increased
                         the salaries, fringe benefits or other compensation
                           of or paid any bonuses or similar compensation to any
                          of its employees who are employed in the Business or
                    given general salary or wage increases to such
employees; or             

            (vi)     agreed to do any of the things described in (i)
through (v) above.        

   (e)      Within the times and in the manner prescribed by law the
                  Vendor has filed all tax returns required by law. Such returns
                were materially correct and complete and the Vendor has paid
               the taxes due and payable as reflected on said returns. The
                  provisions for taxes reflected in the Financial Statements are

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               adequate for all tax liabilities whether or not yet due and
          payable and whether or not disputed. The Vendor has no
                  material liability for any taxes, or any interest or penalties
                in respect thereof, of any nature other than those described
                 in the Financial Statements or arising in the ordinary course
                of business since the date of such Financial Statements. The
          Vendor is up-to-date and current in the payment of all
                  required installments of tax including income tax (federal and
state) and employee source deductions.      

       (f)      Attached hereto as Schedule F is a true and complete list of
              all the employees of the Vendor employed in respect of the
               Business together with their respective positions, years of
                  employment and rates of remuneration and all of said employees
                 who are currently disabled or who claimed disability benefits
            during the preceding twelve months. Those employees with
                 written employment agreements are indicated on Schedule E and
                  copies of such agreements have been provided to the Purchaser.
        Except as disclosed on Schedule E, the Vendor has no
             collective bargaining or other labor agreements, pension,
               bonus, profit sharing, stock option, deferred compensation,
          retainer, consulting, retirement, commissions or other
      material fringe benefits, contracts or agreements.

       (g)      Listed on Schedule G attached hereto are all patents, patent
                 licenses, patent applications or registered copyrights of the
                  Vendor in respect of the Business. To the best of the Vendor's
                  knowledge, it has not infringed and is not now infringing upon
                 any patents, patent licenses, patent applications, copyrights
                or trade secrets belonging to any other person and no person
                has alleged such infringement during the last twelve months,
      or is currently maintaining an allegation of, such
infringement.                               

       (h)      Neither the execution of this agreement nor the consummation
              of the transactions contemplated hereby will result in any
               breach of any term or provision of, or constitute a default
            under the articles or by-laws of the Vendor or under any
                commitment or other agreement to which the Vendor is a party
                or by which it is bound, except as disclosed in any Schedule
                attached hereto or will result in the creation or imposition
                of any lien or encumbrance upon any of the Purchased Assets.

4. Vendor's Covenants: The Vendor covenants as follows:                         

(a)      after the Closing Date the Vendor agrees to allow the
                 Purchaser access to all books, records, data, manuals, source
         code and files regarding the Purchased Assets and all

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                 employee files for those employees  hired pursuant to Section
              5, unless  delivered to the Purchaser on the Closing Date;

   (b)      the Vendor agrees to be responsible for, and to pay, all
              remuneration, including bonuses and vacation pay, owing or
                accrued in respect of any employee hired by the Purchaser up
              to the commencement of such employment with the Purchaser,
                 except for the signing bonuses to be paid by the Purchaser to
                 the Hired Employees (defined below) pursuant to Section 5(c);

     (c)      the Vendor agrees to execute a Non-Competition Undertaking
                 which shall include a non-solicit of Hired Employees (defined
below);                                     

      (d)      the Vendor hereby releases each of the Hired Employees from
           any obligation to maintain the Intellectual Property or
               related information confidential and consents to such Hired
                Employees bringing with them to the Purchaser and using same
         and any equipment, supplies, facility or trade secret
                information of the Vendor whether or not generally available
  to the public in the performance of his or her
responsibilities to the Purchaser; and      

       (e)      the Vendor shall be responsible for all service, maintenance
           and support of any products it has sold or will sell in
connection with the Business.               

5. Purchaser's Covenants: The Purchaser covenants as follows:                   

        (a)      if not already done, the Purchaser agrees to extend offers of
                employment to substantially all of the technical and support
            staff employed in the Business of the Vendor immediately
following the Closing Date;                 

       (b)      the Purchaser agrees that all of the employees of the Vendor
               who accept the offers of employment set out in Section 5(a)
          above (the "Hired Employees"), will be paid his or her
                  remuneration starting December 22, l997 provided such employee
              commences his or her employment with the Purchaser on such
                date and each Hired Employee shall be allowed to participate
                in the Purchaser's applicable benefit plans, including bonus
                 plans, stock option plans, stock purchase plans and insurance
                 programs subject to meeting any vesting periods and according
  to the terms and conditions of such plans; and

     (c)      the Purchaser agrees to pay to the Hired Employees signing
                  bonuses as set out on Schedule F attached hereto provided that
                such signing bonuses shall be paid one-third by December 3l,
              l997, unless any Employee instructs the Purchaser to delay

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               payment until January, l998, with the balance to be paid in
                equal monthly payments over six months following the Closing
Date.                                       

6. Purchase Price and Payment:                                                  

       (a)      The purchase price payable for the Purchased Assets shall be
the sum of $3,023,00l allocated as follows: 

(i)      Software Licenses $l,835,000;      
(ii)     Equipment $938,000;                
(iii)    Facilities $250,000; and           
    (iv)     Intellectual Property Licenses - $1.00.

(b)      In satisfaction of the purchase price payable for the
              Purchased Assets and the Finders Fee, the Purchaser shall:

             (i)      pay $2,523,00l to the Vendor by way of certified
     cheque on the Closing Date; and

              (ii)     on the Closing Date pay to Paul D. Fox, in trust,
                          $500,000 (the "Holdback") to be held and invested in
                           debt instruments acceptable to the Vendor pursuant to
                       an agreed escrow agreement and paid to the Vendor
                      together with interest earned thereon on the six
                       month anniversary of the Closing Date, subject to
               adjustment as provided by this agreement.

         (c)      The payment of the Holdback shall be subject to the following:

                 (i)      subject to Section 7, the Purchaser may withhold any
                        amounts reasonably claimed as owing as a result of
                          any misrepresentation by the Vendor pursuant to this
                          agreement until such claim is finally adjudicated or
          the parties reach agreement thereon;

             (ii)     the Purchaser accepts that the assignment of the
                         software licenses with Veritools and Avanti may not
                         be obtained and agrees that the purchase price will
                         not be adjusted whether or not such assignments are
obtained; and             

                 (iii)    subject to satisfactory evidence, the purchase price
                         shall be reduced by $l0,000 for each Hired Employee
                          who does not remain an employee of the Purchaser for
                          the entire six months after the Closing Date and the
                          Purchaser may recover such amount from the Holdback.

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7. Indemnifications: Until the second anniversary of the Closing Date, the      
Vendor and the Purchaser covenant to indemnify and save the other harmless with 
respect to all liability which such party may sustain or incur as a result of   
the incorrectness or breach of any representation, warranty or covenant herein, 
provided that the Vendor shall indemnify the Purchaser indefinitely with respect
to the representations and warranties in Sections 3(b) and (e). Except for any  
claim with respect to Section 3(b) or Section 6(c)(iii) (the "Excluded Claim"), 
the Purchaser shall not be indemnified by the Vendor until and unless the       
aggregate amount of all claims asserted against the Vendor (excluding the       
Excluded Claims) is in excess of the threshold amount of $50,000 and the amount 
then claimable shall be the entire amount of all claims and not only the amount 
in excess of the said threshold.                                                

8. Survival: All representations, warranties, covenants and agreements made by  
the parties herein or pursuant hereto (except those, if any, duly waived in     
writing) shall speak as of the Closing Date and shall survive the Closing Date  
for a period of two years, except for the representations and warranties in     
Sections 3 (b) and (e) which shall survive indefinitely.                        

9. Governing Law: This agreement shall be construed and interpreted in          
accordance with the laws of the State of Pennsylvania and the parties agree to  
submit any dispute arising out of this agreement to the courts of such State.   

l0. Further Assurances: The parties hereto agree to sign or execute all such    
other deeds and documents and do such other things as may be necessary or       
desirable for more completely and effectually carrying out the terms and        
intention of this agreement.                                                    

ll. Successors and Assigns: This agreement shall enure to the benefit of and be 
binding upon the parties hereto and their respective successors and assigns,    
provided that this agreement shall not be assigned by either party without the  
express written consent of the other party.                                     

l2. Time: Time shall be of the essence of this agreement.                       

l3. Counterparts: This agreement may be executed in counterparts and by fax.    

l4. Expenses: Each party will be responsible for its own legal, accounting,     
investment banking and other advisory fees incurred in respect of the           
transactions provided for in this agreement.                                    

l5. Public Disclosure: The parties hereto reconfirm their obligations pursuant  
to a confidentiality agreement dated November 7, 1997. The Vendor and the       

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Purchaser shall work together and coordinate any public disclosure of the       
subject matter of this agreement including the closing thereof. In the event    
either party is required by applicable regulatory agencies to make any public   
disclosure, it shall give notice of such requirement as soon as possible to the 
other party.                                                                    

l6. Currency: All amounts expressed in this agreement are in U.S. dollars.      

           IN WITNESS WHEREOF the parties hereto have executed and
delivered this agreement as of the date first above written.                    

                    TSENG LABS, INC.

        Per:
                                            --------------------------------

        Per:
                                            --------------------------------

                      ATI RESEARCH, INC.

        Per:
                                            --------------------------------

        Per:
                                            --------------------------------

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 LIST OF SCHEDULES

SCHEDULE A          -         Software Licenses (1(a))                          

SCHEDULE B          -         Equipment (1(b))                                  

SCHEDULE C          -         Facilities (1(c))                                 

SCHEDULE D          -         Intellectual Property License(l(d))               

SCHEDULE E          -         Material Changes (3(c) and (d))                   

SCHEDULE F          -         List of employees and agreements and Signing      
   Bonuses (3(f) and 5(c))

SCHEDULE G          -         List of intellectual property and any alleged     
infringement (3(g)) 

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Schedule A

                                                                [Download Table]

                                                   VALUE       
                 SOFTWARE              VENDOR        $     QTY 
                                                               
Undertow waveform display             Veritools    36,000    15
Hspice circuit simulator            Avant!(Meta)   37,800    6 
AvanWaves analog waveform display   Avant!(Meta)   15,750    3 
Sunrise                               Viewlogic   130,000    1 
Behavioral Compiler                   Synopsys    251,100    2 
(include DC)                                                   
Design Compiler Expert                Synopsys    263,250    5 
Design Analyzer                       Synopsys     28,350    5 
Design Ware Foundation                Synopsys      1,000    4 
(annual subscription)                                          
Design Ware Developer                 Synopsys     36,450    1 
Floor Plan Manager                    Synopsys     32,400    1 
HDL Compiler                          Synopsys     48,600    3 
  (Verilog input to DC)                                        
Library Compiler                      Synopsys     20,250    1 
RTL Analyzer                          Synopsys     36,450    3 
VHDL Compiler                         Synopsys     16,200    1 
Verilog-XL                             Cadence      3,000    3 
Verliog-XL Turbo                       Cadence      8,000    8 
Logic Work Bench                       Cadence     11,400    2 
(for Board design)                                             
Logic Work Bench Designer              Cadence     23,940    3 
Verifault-XL Fault Simulator           Cadence      1,000    1 
Dracula III Basic Bundle               Cadence    115,520    1 
Dracula/LPE                            Cadence     40,850    1 
InQuery (Dracula I/f)                  Cadence     14,250    1 
Diva/DRC                               Cadence     17,100    1 
Diva/ERC                               Cadence     17,100    1 
Diva/LVS                               Cadence     17,100    1 
Preview Floorplan Basic                Cadence      2,000    2 
Preview Floorplan Expert               Cadence      1,000    1 
Cell3 Ensemble P&R Tool                Cadence     70,875    1 
Cell3 Clock Tree Synthesis             Cadence     10,125    1 
Cell3 GUI for Framework                Cadence      3,240    1 
Cell Ensemble                          Cadence     12,150    1 
Cell Ensemble Timing Driven option     Cadence      6,075    1 
DLM P&R System w/Preview Expert        Cadence     28,350    1 
3-Layer Channel Route option           Cadence     15,188    1 
Design Framework                       Cadence      9,500    2 
Composer Design Entry                  Cadence     82,650    6 

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                                                                [Download Table]
                                                                
Circuit Design Environment option       Cadence       11,400  1 
Composer Analysis Environment           Cadence       10,450  2 
Device-level Editing option (DLE)       Cadence       11,400  1 
Virtuoso Polygon Layout Editor          Cadence      142,500  5 
Virtuoso Layout Synthesizer             Cadence       47,500  1 
Virtuoso Compactor                      Cadence       19,000  1 
Open Simulation System                  Cadence       17,100  1 
Cadence Hspice I/f                      Cadence        4,750  1 
EDIFIN                                  Cadence        4,750  1 
Stream (GDSII) to/from Canada           Cadence        2,850  1 
LEDF-LEF/DEF interface                  Cadence        4,050  1 
Arcadia Full-chip (extraction)      Epic(Synopsys)    14,175  1 
Arcadia Interactive Analysis        Epic(Synopsys)    12,353  1 
R3X net by net solver R. extr.      Epic(Synopsys)     6,075  1 
Device parameter extraction         Epic(Synopsys)     4,050  1 
PathMill                            Epic(Synopsys)    24,300  1 
Synopsys/PathMill I/f               Epic(Synopsys)     6,075  1 
DSX/PathMill                        Epic(Synopsys)     8,505  1 
TimeMill                            Epic(Synopsys)    22,599  1 
Vertue for TimeMill                 Epic(Synopsys)     9,720  1 
Block Delay Calculation             Epic(Synopsys)     4,050  1 
Licensed PC software                    Various                 
(NT, Win95, C++, ...)                                           
Server Software/PC                 Novell/Microsoft             

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Schedule B

Name                                        Vendor                  Quantity    

Sun 4/600                                   Sun                         2       
SparcClassic                                Sun                         2       
SparcSystem 600                             Sun                         2       
SparcStation 5                              Sun                         1       
SparcStation 10 (speed?)                    Sun                        13       
SparcStation 20/125                         Sun                         7       
SparcStation 20/100                         Sun                         7       
Sun Ultra 1/140                             Sun                         7       
Sun Ultra 1/170                             Sun                         4       
Sun Ultra 2 (speed? Graphics?)              Sun                         9       
Sun Ultra WWW (wed server)                  Sun                         1       
Sun Memory Upgrades                         Sun                         1       

4500E Rackmount                             Compaq                      3       
ProLinea Server                             Compaq                      1       

CDROM Jukebox                               Microdesign                 1       

Tape Jukebox                                Exabyte                     2       

RAID System                                 Clarions                    3       

Networking Equipment                        3Com/Multitek               1       

ThinkPad Laptops                            IBM                         6       

Desktop Systems                             Misc.                      80       

Printers                                    Misc.                      20       

Test Station                                IMS                         1       

Probe Station                               Rel 8100                    1       

Test Equipment - 5 Logic Analyzers,         var.                        1       
4 scopes, 2 pulse generators, 4 heat                                            
chambers,                                                                       
2 powered microscopes with cameras,                                             
1 pattern generator, misc.                                                      

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Schedule C

All equipment and assets used for the Business, including the following:        

1.  Toshiba Digital Phone System                                                

2. UPS System - IPM 30KUA + Chloride 20KU                                       

3.  Onan - 70 GenSet Generator                                                  

4.  HP Color Plotter                                                            

5.  HP735/125                                                                   

6. All assets and equipment located on the Leased Premises.                     

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Schedule D

 License Agreement

       THIS AGREEMENT made and entered into as of 15th day of December, 1997

BY AND BETWEEN:                                                           

         ATI RESEARCH, INC, having offices at 4 Mount Royal Avenue, Marlborough,
MA, 01758-1978, and                                           

         ATI TECHNOLOGIES INC, a corporation duly incorporated under the laws of
    Ontario, having offices at 33 Commerce Valley Drive E., Thornhill,
Ontario, L3T 7N6,                                             

(hereinafter jointly referred to as "ATI")                    

AND                                                                             

        TSENG LABS, INC, a Nevada Corporation having offices at 6 Terry Drive,
Newtown, Pennsylvania, 18940; and                             

       TSENG INTERNATIONAL LABS, INC., a Delaware Corporation having offices
at 6 Terry Drive, Newtown, Pennsylvania, 18940                

(hereinafter jointly referred to as "Tseng")                  

WHEREAS the parties have entered into an agreement dated as of December 15, 1997
for the transfer of certain assets (hereinafter "Asset Purchase Agreement");    

WHEREAS ATI desires to be granted a license under all of Tseng's intellectual   
property;                                                                       

WHEREAS Tseng desires to confirm that all patents arising from pending U.S.     
Patent Application No. 08/747, 090, will not be asserted against Tseng and/or   
its assigns; and                                                                

WHEREAS Tseng desires to be granted a license under all patents arising from    
Tseng's intellectual property and vesting with ATI to allow Tseng to continue to
manufacture and sell all products currently being manufactured and sold by or on
behalf of Tseng; and                                                            

WHEREAS Tseng desires to confirm that ownership of any patents rights arising   
from the intellectual property shall vest solely with ATI including patent      
rights arising from U.S. Patent Application No. 08/747, 090; and                

WHEREAS each of the Parties is willing to grant such licenses and transfer such 
ownership, subject to the terms and conditions herein set forth.                

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

 DEFINITIONS

(a)      "Subsidiary" shall mean a company of which ATI Technologies, Inc.      
      hereto effectively owns or controls and continues to own or control,
    directly or indirectly, at least fifty percent (50%) of the voting
stock or ownership interest therein;                          

(b)      "Closing Date" shall have the definition described to such term in the 
Asset Purchase Agreement;                                     

(c)      "Business" shall have the definition described to such term in the     
Asset Purchase Agreement;                                     

(d)      "Licensed Intellectual Property" shall mean the intellectual property  
         including technical information, trade secrets, know how, manufacturing
    specifications, processing procedures and research and development
         information, owned or controlled by Tseng as of the Closing Date, which
is either used or arose in the business;                      

(e)      "Assigned Patent Rights" shall mean patent and patent applications     
    arising from the Licensed Intellectual Property whether or not the
    inventions which are the subject of such patent applications arose
        prior to or after the Closing Date and include U.S. Patent Application
No. 08/747,090.                                               

 GRANT OF RIGHTS

Tseng hereby grants to ATI irrevocable, royalty-free world-wide, unrestricted   
license under the Licensed Intellectual Property to make, have made, use, offer 
for sale, import and sell any products either evolving from the Licensed        
Intellectual Property or incorporating the Licensed Intellectual Property. The  
license granted herein to ATI shall include the right to grant sub-licenses and 
shall be transferable and assignable in conjunction with the sale of            
substantially all of the business of ATI.                                       

ATI and/or its assigns hereby grants to Tseng and/or its assigns an irrevocable,
royalty-free, limited, world-wide, license under the Assigned Patent Rights to  
continue to make, have made, use, offer for sale, import and/or sell all        
products currently being manufactured and sold by or on behalf of Tseng as of   
the Closing Date. The license granted herein to Tseng and/or its assigns        
includes the right to grant sub-licenses to manufacturers, distributors,        
customers, and other entities participating in the manufacture and sale of such 
products. The license does not extend to any future products of Tseng and/or its
assigns or any future modifications or extensions to Tseng's currently existing 
products. The license does extend to ET6300 currently under development.        

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ASSIGNMENT OF RIGHTS

In furtherance of the conveyance of assets in accordance with the Asset Transfer
Agreement, Tseng herein assigns the full right, title and interest in and to the
Assigned Patent Rights and further agrees to execute in a timely fashion, such  
documents as are needed in order to permit ATI to perfect, register and maintain
the ownership of rights set for the in this paragraph and to enable ATI to      
acquire patents therefor.                                                       

 NON-ASSERTION

ATI and/or its assigns shall not assert against Tseng and/or its assigns any    
patents, including U.S. and foreign patents, that arise from U.S. Patent        
Applications 08/747,090, filed November 12, 1996 and entitled "Method And       
Apparatus For Displaying Multiple Windows On A Display Monitor".                

MISCELLANEOUS PROVISIONS

If any term, clause, provision of this Agreement shall be judged to be invalid  
or unenforceable, the validity or enforceability of any other term, clause or   
provision shall not be effected; such invalid or unenforceable term, clause or  
provision shall be deemed deleted from this Agreement.                          

This Agreement and the Asset Transfer Agreement set forth the entire agreement  
understanding between the Parties as to the subject matter hereof, and merge all
prior discussions between the Parties, and neither Party hereto shall be bound  
by any conditions, definitions, warrantees, understandings, or representations  
with respect to such subject matter other than is expressly provided therein, or
as duly set forth on or subsequent to the date hereof in writing, signed by duly
authorized offers of the Parties.                                               

This Agreement shall be construed in accordance with and governed by the        
Commonwealth of Pennsylvania and the parties agree to submit any dispute arising
out of this Agreement to the courts of such State.                              

IN WITNESS WHEREOF, the Parties hereto have signed and executed this Agreement  
on the date first mentioned above.                                              

ATI RESEARCH, INC.                          TSENG INTERNATIONAL, LABS, INC.     

Per:                                        Per:                                
 -------------------------                   ---------------------------

ATI TECHNOLOGIES INC.                       TSENG LABS, INC.                    

Per:                                        Per:                                
 -------------------------                   ---------------------------

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Schedule E

MATERIAL CHANGES

l. Pitney Bowes Credit Corp. has a UCC registration in l995 and l997, each of   
which is with respect to a postage meter only.                                  

2. The following state and federal taxes are shown as outstanding liens which   
may create a lien on the Purchased Assets and are therefore to be resolved prior
to release of the Holdback according to the Escrow Agreement:                   

(a)      State Liens                                          

               (i)      95-707l5 dated 4/5/95 in the amount of $46,57l.86;

              (ii)     95-7l663 dated 7/5/95 in the amount of $2,489.60;

                (iii)    95-72294 dated 9/26/95 in the amount of $37,l32.6l;
and                       

(b)      Federal Lien 93-20704 dated 6/7/93 in the amount of  
$6l,388.38.                                 

3. The Epic software licenses are not currently maintained and the Vendor shall 
be responsible to complete such maintenance as soon as possible after the       
Closing Date.                                                                   

4. The Vendor has usual compensation plans for employees including bonus plans, 
stock option plan, 40lK plan and health, life and disability insurance.         

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Schedule F

U.S. Patent Application No. 08/747, 090 entitled "Method and Apparatus for      
Displaying Multiple Windows on a Display".                                      

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Schedule G

CONFIDENTIAL                                                                    
TSENG EMPLOYEE LISTING - DECEMBER 5, 1997                                       

                                                        [Enlarge/Download Table]

                                                 HIRE     YEARS                       
EMPLOYEE NAME        POSITION                    DATE    SERVICE      SALARY     BONUS
-------------        --------                    ----    -------      ------     -----
                                                                                      
Tom Snodgrass        VP & Site Manager         11/01/96    1.10     $141,000   $45,780
Steve Dilliplane     Manager, Software         08/08/94    3.50     $113,000   $38,325
Joseph Chlebda       Manager, Test/Integr.     04/04/90    7.70      $87,471   $20,993
Joe Israel           Senior Engineer           07/15/96    1.40      $79,500   $19,000
David Hui            Vice President            01/30/84   14.00     $123,500   $60,900
Tarek Kaylani        Senior Engineer           11/14/94    3.00      $80,850   $22,365
Mike Jimison         Senior Engineer           08/03/95    2.40      $77,500   $29,500
Lou Aynat            Sales Manager             01/30/84   13.00     $107,919   $26,105
Jim Maino            Senior Engineer           03/28/94    3.80      $81,000   $28,350
Gary Root            Senior Engineer           09/11/95    2.00      $76,000   $18,125
Rich Selvaggi        Principle Engineer        04/09/90    7.50     $113,900   $41,450
Michael Frank        Manager, Design           08/07/96    1.30     $113,000   $27,375
Kathleen Burns       Principle Engineer        09/20/93    4.30      $98,000   $23,625
John Hale            Principle Engineer        05/20/96    1.50      $97,000   $23,375
Warren Szcypiorski   Senior Engineer           06/26/95    2.50      $71,650   $17,038
Tom Noonan           Technical Leader          01/24/94    3.90      $68,500   $13,750
Scott McGovern       Senior Engineer           02/12/96    1.80      $71,500   $20,000
Rowena Chang         Senior Engineer           08/05/89    8.50      $69,800   $16,575
Randy Franklin       Senior Engineer           05/18/92    5.60      $72,821   $17,330
Nick Ditoro          Senior Engineer           04/01/96    1.80      $60,100   $14,150
Mike Roden           Senior Engineer           08/29/94    3.50      $68,500    $9,750
Marge Gillis         Senior Engineer           05/18/94    3.00      $78,100   $18,650
Jiang Qian           Senior Engineer           01/13/97    1.00      $63,500   $15,000
Eric Costello        Senior Engineer           04/29/96    1.70      $68,500   $14,925
Mike Karlin          Manager, MIS              12/02/96    2.00      $75,525   $18,006
Tony Tang            MIS                       06/03/96    1.54      $60,000    $8,475
Rich Colflesh        Senior Technician         11/14/90    7.00      $45,242    $6,261
Pat McLaughlin       Engineer                  07/17/95    2.50      $40,749    $5,587
Joanne Rybarczyk     HR Manager                02/01/96    1.90      $57,500    $7,168
Andrew Silverthorne  Engineer                  04/08/96    1.80      $51,700   $12,050
Kathleen Bishop      Product Support Spec.     12/07/92    5.00      $45,900    $6,360
Gerard McGettigan    Technician                08/08/88    9.30      $42,970    $6,221
David L. Grove       Technician                01/09/95    2.90      $28,600    $3,765
Andrew Rzonca        Technician                11/05/90    7.00      $35,250    $4,783
Dean Pizzo           Facilities Administrator  05/23/97    0.70      $24,300    $2,080
Elaine Grove         Administrative Assistant  03/18/87   10.80      $44,970    $6,011
Kathy Nocero         Accounting Admin          09/05/88    9.50      $50,500    $7,050
                                                                  $2,685,817  $676,253

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NO OFFERS TO:                                                                   
Bonnie Beck                Admin Assist                     03/20/89            
Jim Codispoti              Shipping/Receiving               02/28/92            
Barbara Hawkins            CAO                              01/30/84            
Mike Chang                 Applications Engineer               n/a              
Ken Huang                  Applications Engineer               n/a              
Kris Kernan                Accounts Receivable              08/31/92            
Carey Daniel               Administrative Assistant         04/15/96            
Rich Hooven                Planning Manager                 04/08/96            

EMPLOYEE ON DISABILITY                                                          
Rich Colflesh                                                                   

Dates Referenced Herein

				Referenced-On Page
This ‘8-K’ Filing		Date		First		Last			Other Filings
Filed on:		2/5/98							None on these Dates
For Period End:		12/16/97
		12/15/97		14
		12/5/97		19
		11/7/97		7
		11/12/96		16
									List all Filings