Common use of Channel Clause in Contracts

Channel. 1. Company must enter into a contract (or other written instrument that is reasonably intended to form a contract) with each member of its Channel with which it has a direct business relationship. The contract must include the following terms: i. The Channel must deliver the COA and APM together with each Embedded System; and ii. The Channel must not advertise, give a separate price for, or otherwise market or distribute the Products or any part of a Product, as a separate item from the Embedded System. 2. If Company becomes aware that a Channel member is not complying with these terms, Company must immediately notify MS. 3. If a member of its Channel breaches these terms, Company must stop distributing Product to that member within 10 days of becoming aware of the breach (unless the Channel member has cured that breach within that time). 4. Company must stop any distribution of Product to a Channel member immediately upon notice by MS if MS reasonably determines that i. the Channel member is unlikely to cure its breach, or ii. immediate action is required to protect Microsoft intellectual property. 5. Company must give MS reasonable assistance if MS chooses to investigate a Channel member’s breach of these terms.