TUT SYSTEMS, INC.
VALUE ADDED RESELLER AGREEMENT
This Value Added Reseller Agreement is made, as of the Effective
Date set forth below, between:
(1) Tut Systems, Inc., a Delaware corporation ("Tut Systems"), with
principal offices at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇ and;
(2) ▇-▇▇▇▇▇▇▇▇.▇▇▇.▇▇▇., a Corporation ("VAR")
VAR address:
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇., ▇▇▇. ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
This Value Added Reseller Agreement consists of the VAR Terms and
Conditions attached hereto and the Schedules set forth below
(together this "Agreement"):
Schedule A Certification and Authorization Requirements
Schedule B POS Report Form/Forecast Form
Schedule C Pricing
By signing below, the VAR acknowledges that it has read, understands
and agrees to be bound by all terms and conditions of this Agreement
Value Added Reseller
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
CEO
5-10-99
Tut Systems, Inc.
/s/A.R. ▇▇▇▇▇
A.R. ▇▇▇▇▇
▇.▇. Sales
5-20-99
THIS AGREEMENT is entered into as of the Effective Date set forth on
the preceding page.
BETWEEN:
(1) TUT SYSTEMS, INC. ("Tut Systems"), a Delaware corporation; and
(2) THE VALUE ADDED RESELLER ("VAR") identified on the preceding page.
WHEREAS, VAR is value added reseller of computer products who wishes
to purchase products from Tut Systems for the purposes of resale in
association with other products or services.
THE PARTIES HERETO HEREBY AGREE AS FOLLOWS:
1. DEFINITIONS.
In this Agreement, including the Schedules hereto, the following
words and expressions shall have the following meanings:
"Party" shall mean Tut Systems and/or VAR.
"Price" shall mean the F.O.B., origin, price for Products as
currently set out in the Tut Systems VAR Price List, incorporated by
reference as if set forth in full herein, as made available to VAR
and revised by Tut Systems from time to time pursuant to this
Agreement.
"Products" shall mean the Tut Systems products described on the Tut
Systems North American VAR Price List, incorporated by reference as
if set forth in full herein, as made available to VAR and revised by
Tut Systems from time to time pursuant to this Agreement.
"Territory" shall mean the United States of America and its
territories and possessions.
2. VAR APPOINTMENT.
(a) Appointment. Subject to the terms and conditions set out in
this Agreement, Tut Systems hereby appoints VAR as a value added
reseller to promote, market and sell the Products in the Territory
during the Term.
(b) Sales Efforts. During the Term, VAR shall use its commercially
reasonable efforts to promote, market and sell the Products in the
Territory during the Term. Without the prior written consent of Tut
Systems, VAR shall not directly or indirectly (i) solicit sales of
the Products outside of the Territory, or (ii) sell to any person
which VAR understands or reasonably expects will resell the Products.
(c) No Limit on Price. Although Tut Systems may from time to time
publish suggested and-user list prices for the Products, VAR has the
unrestricted right to unilaterally determine the prices at which it
resells the Products which it purchases hereunder. No Tut Systems
representative has the authority to require or suggest that VAR
charge a particular resale price for the Products which it purchases
hereunder.
(d) Non-Exclusive Right. VAR's right to resell the Products shall
be non-exclusive and Tut Systems shall continue to have the right to
promote, market and sell the Products in the Territory and
elsewhere, and any other products which are similar and/or through
any agent or representative.
(e) Compliance with Authorization and Certification Requirements.
VAR's right to remain a value added reseller hereunder or to sell
various Products or Product lines shall be subject to VAR's
continuing compliance with the authorization and certification
requirements set forth in Schedule A, as amended from time to time
by Tut Systems on notice to VAR. If VAR fails to maintain
compliance with such requirements as then in effect, then Tut
Systems may terminate this Agreement in accordance with Section 8c
or terminate VAR's right to sell certain Products as appropriate.
3. TERMS OF PURCHASE OF PRODUCTS BY VAR.
(a) Terms and Conditions. All purchases of Products by VAR from Tut
Systems during the term of this Agreement shall be subject to the
terms and conditions of this Agreement.
(b) Prices. All prices are F.O.B. Tut Systems plant currently
located at the address listed for Tut Systems at the beginning of
this Agreement. The purchase price to VAR for each of the Products
("Purchase Price") shall be as set forth in the VAR Price List. The
difference between VAR's Purchase Price and VAR's selling price to
its customers shall be VAR's sole remuneration for sale of the
Products. Tut Systems has the right at any time to revise the
prices in the VAR Price List with thirty (30) days advance written
notice to VAR. Such revisions shall apply to all orders received
after the effective date of revision.
(c) Price Protection
(i) In the event of a price increase, Tut Systems will honor orders
or portions hereof already accepted and acknowledged by Tut Systems
at the prices in effect previous to the effective date of the price
increase and orders scheduled by Tut Systems for delivery within
thirty (30) days after the effective date of the price increase.
Orders scheduled by Tut Systems for delivery after (30) days from
effective date of the price increase shall automatically be adjusted
by Tut Systems. After the effective date of the price increase,
orders will be accepted at the increased price.
(ii) In the event of a price reduction, unshipped orders already a
scheduled by Tut Systems for product affected by the price reduction
shall be automatically adjusted by Tut Systems to reflect the price
decrease. Tut Systems will provide VAR with written notice of any
decrease not later than fifteen (15) days after the effective date
of such decrease. Product in transit and product in VAR's inventory
purchased not more than sixty (60) days prior to the effective date
of such price decrease shall be subject to the price reduction ;
provided, however that (A) VAR applies in writing to Tut Systems for
the price reduction within sixty (60) days after the effective date
of the announced price reduction and (B) VAR forwards an inventory
report to Tut Systems that indicates model and quantity of inventory
in stock. Tut Systems reserves the right to verify the inventory
report and conduct an audit of VAR's inventory. Tut Systems shall
issue a credit for the price reduction to VAR within thirty (30)
days after receipt and verification of VAR inventory report. The
credit shall be equal to the difference between the price at the
time of the sale of the Product to VAR and the new reduced price.
(iii) Tut Systems shall have no obligations pursuant to this Section
3(c) unless VAR has timely performed all of its obligations pursuant
to Section 6(a)(i) here of during the previous six months.
(d) Taxes. VAR agrees to report and pay all taxes, customs duties
and assessments imposed on VAR or Tut Systems in connection with the
distribution and sale of Tut Systems product hereunder including any
sales, use, excise, and other taxes and duties, except for taxes
imposed on Tut Systems income. To the extent that Tut Systems is
required by statute or regulation to collect and report taxes,
duties, customs, or any other costs to various authorities (both
foreign and domestic), such taxes, duties, customs, or any other
costs will be billed directly to VAR.
(e) Order and Acceptance. All orders for Products submitted by VAR
shall be initiated by written purchase orders sent to Tut Systems
and requesting a delivery date during the term of this Agreement;
provided however, that an order may initially be placed orally if a
conformational written purchase order is received by Tut Systems
within five (5) days after said oral order. No order shall be
binding upon Tut Systems until accepted by Tut Systems in writing,
or by shipping product in accordance with the order. Tut Systems
will use reasonable efforts to notify VAR of the acceptance of an
order within five (5) business days of its receipt of an order, or
at Tut Systems sole discretion, deliver the ordered products. Tut
Systems shall use its reasonable best efforts to deliver Products at
the times specified either in its quotation or in its written
acceptance of VAR's purchase orders. However Tut Systems shall not
be liable for any damages resulting from its failure to meet such
shipment dates, even if Tut Systems has been advised of the
possibility of such damages. Partial shipments may be made upon
written approval of VAR. No partial shipment of an order shall
constitute the acceptance of the entire order, absent the written
acceptance of such order.
(f) Terms of Purchase Orders. VAR's purchase orders submitted to
Tut Systems from time to time with respect to Products to be
purchased hereunder shall be governed by the terms of this
Agreement, and nothing contained n any such purchase order shall in
any way modify such terms of purchase or add any additional terms or
conditions.
(g) Payment. Full payment of VAR's Purchase Price for the Product
(including any freight, taxes or other
applicable costs initially paid by Tut Systems but to be borne by
VAR) shall be due in full, net thirty (30) days, and payment shall
be made by wire transfer, check, or other instrument approved by Tut
Systems, payable in U.S. Dollars. Any invoiced amount not paid when
due shall be subject to a service charge of one and on-half percent
(1.5%) per month and Tut Systems, at its option, may revoke any
previously granted terms of credit. Except for credits issued under
Sections 3c or 5, VAR agrees to no rights of setoff for amounts it
owes for particular Products against amounts owed to it by Tut
Systems. Tut Systems may withhold or suspend its performance under
this Agreement in the event that VAR fails to make timely payments
of outstanding invoices. VAR shall pay all of Tut Systems costs and
expenses (including reasonable attorneys' fees) to enforce and
preserve Tut Systems rights under this Subsection 3(g).
(h) Shipping. All Products delivered pursuant to the terms of this
Agreement shall be suitably packed for air freight shipment in Tut
Systems standard shipping cartons, marked for shipment at VAR's
address set forth above and delivered to VAR or its carrier agent
F.O.B. Tut Systems manufacturing plant or warehouse, at which time
title to such Products and risk or loss shall pass to VAR. Unless
otherwise instructed in writing by VAR, Tut Systems shall select the
carrier. All freight, insurance, and other shipping expenses, as
well as any special packing expense, shall be paid by VAR. VAR also
agrees that no delivery pursuant to this Agreement shall be
construed as a single lot contract under the Uniform Commercial
Code, in addition, remedies provided under a single lot contract
shall not apply to any shipment under the agreement.
(i) Product Acceptance. VAR shall be deemed to have accepted
delivery of Tut Systems Products, unless rejected upon inspection at
the time of delivery. The reason for rejection must be submitted in
writing to Tut Systems within fifteen (15) business days from the
date of delivery (Rejection Period). VAR agrees that its remedies
are limited to the remedies contained in the warranty provisions of
this Agreement under sections 4 (Warranty and Disclaimer), and 5
(Rejection and Warranty Procedures).
(j) Return of Products after Rejection Period. After the Rejection
Period, VAR may not return a Product to Tut Systems for any reason
without Tut Systems prior written consent. For any Product for
which Tut Systems gives such consent, Tut Systems may charge VAR a
restocking fee equal to twenty five percent (25%) of VAR's Purchased
Price for that Product and shall credit the balance of the Purchase
Price to VAR's account. VAR shall be responsible for all shipping
charges.
(k) Security Interest. For the purpose of securing payment of the
price of Tut Products and all other charges payable to Tut
hereunder, VAR hereby grants to Tut a security interest in each and
every Tut Product delivered to Var under this Agreement, including
without limitation any proceeds from its resale or distribution or
from insurance held by VAR covering Tut Products. VAR shall
cooperate with Tut and execute any necessary documents to perfect
Tut security interest granted herein, where required by state law.
These interests will be deemed satisfied and deemed released by
payment in full of the purchase price and all other charges payable
hereunder for each such Tut Product.
(l) Product Changes. Tut Systems shall have the right, in its
absolute discretion, without liability to VAR, to change the design
or to discontinue the manufacture or sale of any Product covered by
this Agreement. Tut Systems shall attempt to notify VAR at least
thirty (30) days prior to the delivery of any product which
incorporates a change in design that shall, in Tut System's
reasonable opinion, affect the marketability of any Product I VAR's
inventory. Tut Systems shall also endeavor to notify VAR at least
thirty (30) days prior to the discontinuance of manufacture of any
Product. Tut Systems, however, shall not incur any liability to VAR
for its failure to so notify VAR.
4. WARRANTY AND DISCLAIMER.
(a) Standard Limited Warranty. When the products purchased
hereunder are resold to the end-user (customer) pursuant to the
terms hereof in their original, unmodified, unused condition, VAR
shall pass on to its customers Tut Systems standard limited warranty
for the Products, as summarized in documentation supplied with the
Product and including provisions and limitations set forth below.
(b) Express End-User Limited Warranty.
(i) Each Tut Systems Product purchased hereunder is warranted
against defect in material and workmanship and will substantially
conform to Tut Systems Product documentation for the period set
forth in the documentation supplied with the product following
delivery to end-user ("Warranty Period"). This warranty extends
only to end user and will not extend to, nor
may it be assigned to, any subsequent VAR, purchaser or user of a
Tut Systems Product, whether such Tut Systems Product is alone or
incorporated into end-user's product.
(ii) The Company's products, including separately sold software
applications, are designed to be used prior to, during, and after
the calendar year 2000 and will operate during each such time period
without error relating to date data specifically indulging any error
relating to, or product of date, date which represents or
references different centuries or more than one century.
(c) Exclusions. The express warranty set forth above is contingent
upon the proper use of a Tut Systems Product in the application for
which it was intended and will not apply to any Tut Systems Product
that has been (i) damaged during shipping, (ii) modified or
improperly maintained or repaired by a party other than Tut Systems
or its designees, or (iii) subjected to unusual physical or
electrical stress.
(d) Limitation of Remedy. In the event a Tut Systems Product fails
to perform as warranted, Tut Systems sole and exclusive liability
and end-user's only remedies for breach of this warranty shall be,
at Tut Systems option to repair, replace or credit an amount not
exceeding the VAR's purchase price of each Product found to be
defective, provided that:
(i) End-user complies with the rejection and warranty procedures
contained in Section 5 below and returns the Tut Systems Product
that the end-user considers defective for examination and testing.
(ii) Tut Systems shall not be liable under this warranty if testing
and examination by Tut Systems discloses that the Tut Systems
Product has been modified or altered in any manner after it was
shipped by Tut Systems.
(iii) Tut Systems shall not be liable under this warranty if testing
and examination by Tut Systems discloses that the alleged defect in
the Tut Systems Product does not exist or was caused by end-user or
any third person's misuse, neglect, improper installation or
testing, unauthorized attempts to repair or any other cause beyond
the range of intended user, or by accident, fire or other hazard.
(iv) Tut Systems shall not be liable under any warranty under this
Agreement with respect to any Tut Systems Product that is not
returned in its original shipping container or a functionally
equivalent container.
(v) If Tut Systems testing and examination does not disclose a
defect warranted under this Agreement:
(A) Tut Systems shall so advise VAR and dispose of such Tut Systems
Product in accordance with VAR's instructions on behalf of end-user
and at VAR's cost; and
(B) VAR shall reimburse Tut Systems for its expense in testing and
examining such Tut Systems Product calculated at Tut Systems
standard rates.
(e) No Other Warranty. EXCEPT FOR THE EXPRESS WARRANTY SET FORTH
ABOVE, TUT SYSTEMS GRANTS NO OTHER WARRANTIES, EXPRESS OR IMPLIED,
BY STATUTE OR OTHERWISE, REGARDING THE PRODUCTS, INCLUDING THEIR
FITNESS FOR ANY PURPOSE, THEIR QUALITY, THEIR MERCHANTABILITY,
NON-INFRINGEMENT OR OTHERWISE.
(f) Limitation of Liability. IN NO EVENT SHALL TUT SYSTEMS BE
LIABLE FOR COSTS OF PROCUREMENT OF SUBSTITUTE PRODUCTS OR SERVICES,
NOR WILL EITHER PARTY BE LIABLE FOR LOST PROFITS, OR ANY OTHER
SPECIAL, INDIRECT, CONSEQUENTIAL OR INCIDENTAL DAMAGES, HOWEVER
CAUSED AND ON ANY THEORY OF LIABILITY, ARISING OUT OF OR RELATING TO
PRODUCT WARRANTY OR THIS AGREEMENT OR RESULTING FROM THE SALE OF
PRODUCTS OR SERVICES BY VAR OR RESALE OR USE BY ANY END-USER OR ANY
TRANSFEREE OF SUCH PRODUCTS OR SERVICES. ANY LIABILITY OF TUT
SYSTEMS HEREUNDER WILL BE LIMITED IN ALL CASES TO THE AMOUNT PAID BY
VAR FOR TUT SYSTEMS PRODUCTS. THIS LIMITATION SHALL APPLY EVEN IF A
PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND
NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED
REMEDY. THE PARTIES ACKNOWLEDGE THAT THE FOREGOING IS A REASONABLE
ALLOCATION OF RISK.
5. REJECTION AND WARRANTY PROCEDURES.
In the event of rejection of Tut Systems Product within the
Rejection Period or a Tut Systems Product fails to perform as
warranted within the Warranty Period, VAR or end-user, as relevant,
will give notice to Tut Systems or VAR, respectively, within the
relevant limitation period, which notice will request a Return
Material Authorization ("RMA") number. Tut Systems will provide the
RMA number to VAR within five (5) days after the giving of notice
and the request. Within thirty (30) days after its receipt of the
RMA number, VAR or end-user will return to Tut Systems or its
designee the rejected or defective Tut Systems Product, freight or
postage prepaid in its original shipping carton or a functionally
equivalent container. Tut Systems reserves the right to refuse to
accept any rejected or defective Tut Systems Product not bearing an
RMA number on the outside of the carton and/or documentation
accompanying the shipment such as packing slips. If the Tut Systems
Product is determined to be defective in accordance with Section 4
(Warranty and Disclaimer), Tut Systems will at is sole option and
expense, either repair, replace the Tut Systems Product and ship it
in accordance with VAR's instruction, to VAR or end-user, or credit
to VAR an amount not to exceed the VAR's purchase price of each good
found to be defective. Tut Systems will use all reasonable efforts
to ship the repaired or replaced Tut Systems Product within thirty
(30) days of its receipt of such Tut Systems Product.
6. VAR'S OBLIGATIONS.
(a) Obligations. VAR shall:
(i) Furnish monthly point-of-sale reports in electronic (machine
readable) format to Tut Systems upon request by Tut Systems from
time to time. The format and content of such point-of-sale reports
will be as set forth in Schedule B hereto, respectively, as such
schedules may be modified from time to time by Tut Systems. VAR
hereby agrees to provide to Tut Systems such other reports relating
to this Agreement and the Products as Tut Systems may reasonably
request from time to time.
(ii) Furnish Tut Systems, upon request by Tut Systems from time to
time, a rolling three (3) month forecast of its projected
requirements for each customer by month in electronic (machine
readable) format. The format and content of such forecast will be
as set forth in Schedule B hereto, as such schedule may be modified
from time to time by Tut Systems.
(iii) Not remove, obscure or modify an label or other indication of
copyright or other intellectual property rights on the Products.
(iv) Agree to the terms and conditions of any software license or
product warranty terms enclosed with the Products.
(v) Not sell Products other than in original, unmodified, unused
condition, except that the unmodified Products may be bundled or
packaged with other goods to comprise a system.
(b) Software. VAR acknowledges that all software Products of
Products which include software are proprietary to Tut Systems or
its licensers and are subject to copyrights and trade secrets owned
by Tut Systems or its licensers. All references in this Agreement
to "purchases," "sales," or words of similar import, of software
Products or Products which include software signify only the
acquisition of a license for VAR to transfer such software to its
end-users in accordance with the terms of this Agreement.
(c) VAR's Responsibility. VAR hereby understands that it is
responsible for determining the suitability of Products for the
purposes for which Products are purchased or sold by VAR.
(d) Limitation on VAR's Rights to the Products. VAR shall have no
access to, or rights in the source codes of any software included in
the Products. VAR shall have no right to copy, modify or
remanufacture any Product or part hereof nor reproduce any written
material supplied by Tut Systems without the explicit written
consent of Tut Systems.
7. TUT SYSTEMS OBLIGATIONS.
Tut Systems shall:
(a) Provide VAR with sales support through its national and field
sales offices and affiliated companies.
(b) Allow VAR to participate in such cooperative marketing programs
and other sales incentive programs as Tut Systems may make generally
available to similarly situated resellers of Products; provided,
however, that Tut Systems reserves the right to alter or eliminate
any such cooperative marketing programs or other sales incentive
programs at any time ; and
(c) Furnish VAR with a reasonable quantity of its standard sales
promotion literature, such as brochures and specification sheets;
provided that Tut Systems reserves the right to charge VAR if it
requests large quantities of such materials.
(d) Services by Tut Systems. Additional customer service and
technical support is available by phone in the United States at
(▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇, or via e-mail at
▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇. Extended warranty, contract service, repair
and other services are available for purchase at Tut Systems
published standard rates.
8. NON-SOLICITATION
Tut Systems and VAR will, from time to time, introduce each other to
leads and customers. Both parties hereby agree that if they are
introduced to a lead or customer of the other, that they will
actively seek to sell products and services of the other and will
not introduce, sell products or services of nor attempt in any other
way to form a relationship with the lead or customer and another
competitive 3rd party. If Tut Systems or VAR decides to withdraw
from the account, written notice shall be given to the other at
which time they may introduce a 3rd party solution.
9. TERM AND TERMINATION.
(a) Term. This Agreement shall continue in force for a fixed term
of one (1) year from the date hereof unless terminated earlier under
the provisions of this Section 8. At the end of the fixed term and
the end of each subsequent one year term, this Agreement shall renew
automatically for an additional one (1) year period, unless sixty
(60) days prior to the renewal date, the Agreement is terminated by
written notice by Tut Systems.
(b) Termination for Convenience. This Agreement may be canceled by
either party for any reason or no reason, whether or not extended
beyond the first term, by giving the other party written notice
ninety (90) days in advance. If Tut Systems terminates this
Agreement under the provisions of this Subsection 8(b), then Tut
Systems shall, at VAR's option, repurchase VAR's then-current
inventory at VAR's original Purchase Price and shall bear all
shipping costs for the return to Tut Systems of that inventory.
(c) Termination for Cause. Aside from the provisions of section
3(g), if either party defaults in the performance of any provision
of this Agreement, then the non-defaulting party may give written
notice to the defaulting party that if the default is not cured
within thirty (30) days the Agreement will be terminated. If the
non-defaulting party gives such notice and the default is not cured
during the thirty-day period, then the Agreement shall automatically
terminate at the end of that period. In addition, if sales efforts
limits to the Territory as defined in 2 (b) above are violated. Tut
Systems may terminate this Agreement immediately.
(d) Termination for Insolvency. This Agreement shall terminate,
without notice, (i) upon the institution by or against VAR of
insolvency, receivership or bankruptcy proceedings or any other
proceedings for the settlement of the VAR's debts, (ii) upon VAR's
making an assignment for the benefit of creditors, or (iii) upon
VAR's dissolution or ceasing to do business.
(e) Fulfillment of Orders upon Termination. Upon termination of
this Agreement for other than VAR's breach, Tut Systems shall
continue to fulfill, subject to the terms of Section 3 above and in
particular section 3(g), all orders accepted by Tut Systems prior to
the date of termination.
(f) Return of Materials. All trademarks, trade names, patents,
copyrights, design, drawings, formulas or other date, photographs,
samples, literature, and sales aids of every kind shall remain the
property of Tut Systems. Within thirty (30) days after the
termination of this Agreement, VAR shall prepare all such items in
its possession for shipment, as Tut Systems may direct at Tut
Systems expense. VAR shall not make, use, dispose, of or retain any
copies of any confidential items or information which may have been
entrusted to it. Effective upon the termination
of this Agreement. VAR shall cease to use all trademarks, marks,
and trade names of Tut Systems.
(g) List of Customer Installed Base. To the best of its ability,
VAR shall provide to Tut Systems, up-to-date list of names,
addresses and phone/fax numbers of all customers currently using Tut
Systems Products within the Territory to allow continuance of service.
(h) Survival of Certain Terms. The provisions of Sections 3(d),
3(g), 4, 8, 9, 10, 11, and 12, shall survive the Termination of this
agreement for any reason. All other rights and obligations of the
parties shall cease upon Termination of this Agreement.
10. INTELLECTUAL PROPERTY INFRINGEMENT INDEMNIFICATION.
(a) Indemnity. Tut Systems will defend, at its own expense, any
claim, suit, or proceeding brought against VAR to the extent it is
based upon a claim that any Product under normal use sold pursuant
to this Agreement infringes upon any presently issued U.S. patent or
any copyright, or misappropriates any trade secret, of any third
party. VAR agrees that it shall promptly notify Tut Systems in
writing of any such claim or action and give Tut Systems full
information and assistance in connection therewith. Tut Systems
shall have the sole right to control the defense of any such claim
or action and the sole right to settle or compromise any such claim
or action. If VAR complies with the provisions hereof, Tut Systems
will pay all damages, costs and expenses finally awarded to third
parties against VAR in such action. If a Product is, or in Tut
Systems opinion might be, held to infringe as set forth above Tut
Systems may, at its option replace or modify such Product so as to
avoid infringement, or procure the right for VAR to continue the use
and resale of such Product. If neither os such alternatives is in
Tut Systems opinion commercially reasonable, the infringing Product
shall be returned to Tut Systems and Tut Systems sole liability, in
addition to its obligation to reimburse awarded damages, costs and
expenses as set forth above, shall be to refund the amounts paid for
such Products less depreciation measured equally over a sixty (60)
month period from the date of purchase by VAR.
(b) Limitations. Tut Systems will have no liability for any claim
of infringement arising as a result of VAR's use or sale of a
Product in combination with any items not supplied by Tut Systems,
any modification of a Product by VAR or third parties, or the
failure to use the latest version of any software provided for such
Product if infringement would have been avoided with such use.
(c) Entire Liability. THE FOREGOING STATES THE ENTIRE LIABILITY AND
OBLIGATIONS OF TUT SYSTEMS TO VAR OR ANY PURCHASER OF PRODUCTS AND
THE EXCLUSIVE REMEDY OF VAR OR ANY PURCHASER OF PRODUCTS WITH
RESPECT TO THE ALLEGED OR ACTUAL INFRINGEMENT OF INTELLECTUAL
PROPERTY RIGHTS INCLUDING, BUT NOT LIMITED TO, PATENT, COPYRIGHT AND
TRADE SECRET RIGHTS.
11. IMPORT AND EXPORT CONTROLS.
(a) Regulation. VAR understands and acknowledges that Tut Systems
is subject to regulation by agencies of the United States government
including, without limitation the U.S. Department of Commerce, which
agency prohibits export or diversion of certain products and
technology to certain countries. Any and all obligations of Tut
Systems to provide Tut Systems Products as well as any technical
assistance will be subject in all respects to such United States
laws and regulations as from time to time govern the delivery and
license of technology and products aborad by persons subject to the
jurisdiction of the United States including, without limitation ,
the Export Administration Act of 1979, as amended, any successor
legislation and the Export Administration Regulations issued by the
Department of Commerce, Bureau of Export Administration. VAR agrees
to cooperate with Tut Systems in order to obtain export licenses or
exemptions therefrom by, among other things, providing required
documentation. VAR warrants that it will comply with the Export
Administration Regulations and other United States laws and
regulations governing exports in effect from time to time.
12. TRADEMARKS.
(a) Limited Trademark License. Tut Systems grants to VAR a
non-exclusive limited license to use during
the term of this Agreement. Tut Systems name, logo and other
trademarks used by Tut Systems in the Territory from time to time
with Respect to the Products (the "Trademarks") for proper purposes
in connection with the promotion and safe of the Products.
(b) VAR's Use. VAR's use of the Trademarks shall be in accordance
with applicable trademark law and Tut Systems policies regarding
advertising and trademark usage as established and amended from time
to time. VAR shall include all applicable Tut Systems Trademarks in
any literature, promotion or advertising which it produces or
distributes concerning the Products. VAR will not use any such
Trademarks other than with respect to the direct promotion of the
Products.
(c) Tut Systems Designations. VAR will not remove, deface or alter
any Tut Systems trademarks, model numbers or other designations
affixed to the Products by Tut Systems. VAR will not affix any
other trademarks, trade names, model designations or nameplates to
the Products.
(d) Ownership of Trademarks. VAR agrees that the Trademarks are and
will remain the sole property of Tut Systems and agrees not to do
anything inconsistent with that ownership or to contest ownership of
such Trademarks. VAR agrees to always identify the Trademarks as
being the property of Tut Systems. Var also agrees that all use of
the Trademarks by VAR will inure to the benefit of and be on behalf
of, Tut Systems.
(e) Trademark Quality Standards. VAR agrees that any system or
service sold by VAR which contains the Products and displays the
Trademarks must conform to Tut Systems quality standards for the use
of its Trademarks, and VAR agrees to cooperate with Tut Systems in
monitoring the nature and quality of such systems and services for
purposes of VAR's use of such Trademarks.
13. GENERAL PROVISIONS.
(a) Governing Law and Jurisdiction. This Agreement shall be
governed by and construed under the laws of the State of California,
U.S.A. The federal and state courts within the State of California,
U.S.A., shall have exclusive jurisdiction to adjudicate any dispute
arising out of this Agreement. VAR hereby expressly consents to (i)
the personal jurisdiction of the federal and state courts within
California, (ii) service of process being effected upon it by
registered mail sent to the address set forth at the beginning of
this Agreement, and (iii) the uncontested enforcement of a final
judgment from such court in any other jurisdiction wherein VAR or
any of its assets are present.
(b) Entire Agreement. This Agreement sets forth the entire
Agreement and understanding of the parties relating to the subject
matter herein and merges all prior discussions between them. No
modification of or amendment to this Agreement, nor any waiver of
any rights under this Agreement, shall be effective unless placed in
writing signed by the parties.
c) Notices. Any notice required or permitted by this Agreement shall
be in writing and shall be sent by prepaid registered or certified
mail, return receipt requested, addressed to the other party at the
address shown at the beginning of this Agreement or at such other
address for which such party gives notice hereunder. Such notice
shall be deemed to have been given three (3) days after deposit in
the mail.
(d) Force Majeure. Nonperformance of either party shall be excused
to the extent that performance is rendered impossible by strike,
fire, flood, governmental acts or orders or restrictions, failure of
suppliers, or any other reason where failure to perform is beyond
the reasonable control of and is not caused by the negligence of the
nonperforming party.
(e) Nonassignability and Binding Effect. A mutually agreed
consideration for Tut Systems entering into this Agreement is the
reputation, business standing, and goodwill already honored and
enjoyed by VAR under its present ownership and, accordingly. VAR
agrees that its rights and obligations under this Agreement my not
be transferred or assigned directly or indirectly without the prior
written consent of Tut Systems. Subject to the foregoing sentence,
this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their successors and assigns.
(f) Foreign Corrupt Practices Act. VAR shall not act in any fashion
or take any action which would render Tut Systems liable for a
violation of the U.S. Foreign Corrupt Practices Act, which prohibits
the offering giving or promising to offer or give, directly or
indirectly, money or anything of value to any official of a
government, political
party or instrumentally thereof in order to assist it or the Tut
Systems in obtaining or retaining business.
(g) Further Assurances. VAR agrees, upon request by Tut, to
promptly execute, acknowledge and deliver such further documents as
are necessary to fulfill the purposes of this Agreement, including
without limitation a UCC-1 financing statement covering Tut Products.
(h) Legal Expenses. The prevailing party in any legal action
brought by one party against the other and arising out of this
Agreement shall be entitled, in addition to any other rights and
remedies it may have to reimbursement for its expenses, including
court costs and reasonable attorneys' fees.
(i) Severability. If any provision in this Agreement is found or
held to be invalid or unenforceable in any respect, such
unenforceability will not effect any other provisions of this
agreement, provided that the expected economic benefit of this
Agreement are not denied to either party.
(j) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of
which together shall constitute one instrument.
(k) Headings Descriptive. The captions and headings of this
Agreement are for convenience of reference only and shall not affect
the interpretation of this Agreement.
(l) Singular and Plural. When required by the context hereof, the
singular includes the plural and vice versa.
SCHEDULE A
VALUE ADDED RESELLER AGREEMENT
Authorization and Certification Requirements
Tut Systems requires its value added resellers, including VAR, to
sell in each calendar year at least $1,000,000 (the "Minimum Sales
Requirement") of products purchased under this Agreement. The
Minimum Sales Requirement is based on the amount paid by VAR to Tut
Systems, or Tut Systems authorized VAR of Products for the
Territory, for Products purchased under this Agreement in the
relevant year, less discounts, returns and other adjustments. If
VAR fails to maintain the Minimum Sales Requirement, VAR may be
terminated for breach of this Agreement. The Minimum Sales
Requirement shall be prorated for the first year of this Agreement
based on the number of months (or portions thereof) remaining in
such year, if the Term commences after the beginning of any calendar
year.
Tut Systems also prefers that VAR have access to e-mail at its
corporate and branch levels. However, Tut Systems will not
terminate a VAR for breach of this Agreement if it fails to have or
maintain such e-mail capabilities.
Certification
VAR must comply with Tut Systems training programs, post sales
service and support programs and procedures, including warranty
support, with respect to each Product line, as such programs and
procedures exist from time to time.
SCHEDULE B
VALUE ADDED RESELLER AGREEMENT
POS Report Form
[DIAGRAM]
Schedule C
Transfer Pricing to ▇▇▇▇▇▇▇▇▇.▇▇▇, Inc.
Based on Published Prices of 5/1/2/99
