Audio MPEG and Sisvel make available worldwide non-transferable, non-assignable, non-exclusive licenses, without the possibility to sublicense, for having the right to use the US Patents and Non-US Patents respectively.

The licenses are granted for two different categories as below.

CONSUMER HARDWARE LICENSE

The consumer hardware license covers consumer electronics products conforming to the ISO/IEC 11172-3 (MPEG-1 Audio) and/or ISO/IEC 13818-3 (MPEG-2 Audio) standards that are sufficiently assembled to be suitable for sale to or use by an end user.

The consumer hardware license does not cover:

• Products or part of products which make use of optical record carriers (and including such carriers), such as CD, Video-CD and DVD, only carrying records in standards other than MP3;
• Products conforming to the DAB (Digital Audio Broadcast) standard; or
• Components, such as integrated circuit chips or chip sets.

Compensation: a non-refundable and non-recoupable entrance fee is due as well as a payment in consideration of a paid up grant of licenses and releases by Sisvel and Audio MPEG.

PROFESSIONAL HARDWARE LICENSE

The professional hardware license covers electronics products conforming to the ISO/IEC 11172-3 (MPEG-1 Audio) and/or ISO/IEC 13818-3 (MPEG-2 Audio) that are intended and specially designed for business or commercial uses by end users, not intended for consumer uses, and sufficiently assembled to be suitable for sale to or use by an end user.

The professional hardware license does not cover:

• Products or part of products which make use of optical record carriers (and including such carriers), such as CD, Video-CD and DVD, only carrying records in standards other than MP3;
• Products conforming to the DAB (Digital Audio Broadcast) standard; or
• Components, such as integrated circuit chips or chip sets.

Compensation: a non-refundable and non-recoupable entrance fee is due as well as a payment in consideration of a paid up grant of licenses and releases by Sisvel and Audio MPEG.