EXHIBIT 10.17
PRIMUS KNOWLEDGE SOLUTIONS, INC.
Amended and Restated Software Marketing and Distribution Agreement
Primus Contract ID: SMDA4783
This Agreement ("Agreement") is made between Primus Knowledge Solutions, Inc.
("Primus"), 0000 Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxxxx 00000, X.X.X.
(fax: x0 (000) 000-0000) and
Distributor Name: Primus Knowledge Solutions, KK,
a Japanese corporation ("Distributor")
Distributor Address: Ebisu Prime Sq. Tower
0-0-00 Xxxxx, Xxxxxxx-xx
Xxxxx, XXXXX 150
Fax No.: x00 0-0000-0000
Primus is the owner and licensor of the Software (defined below). Primus wishes
to market and distribute the Software in the Territory (defined below).
Distributor has know-how and experience in marketing and distributing software
in the Territory, and in providing related services, and wishes to assist
Primus. Primus is willing to appoint Distributor to market and distribute the
Software in the Territory, and Distributor is willing to accept such
appointment, all on the terms and conditions specified below. Therefore, for
good and valuable consideration, the receipt and sufficiency of which they each
acknowledge, Primus and Distributor agree to be bound by such terms and
conditions. This Agreement supercedes any and all prior agreements between
Primus and Distributor.
EXECUTED as of the date set forth below Primus' signature:
Primus Knowledge Solutions, Inc. Distributor
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxxxxx Xxxxxx
Xxxxxxx X. Xxxxxx Xxxxxxxx Xxxxxx
Its: President and Chief Executive Officer Its: President
Dated: 3/31/00 Dated: March 31, 2000
Terms and Conditions
Table A - Distributor's Rights
====================================================================================================================================
Product Language Exclusivity Territory Term
------------------------------- ------------- ---------------------------------------
Exclusive Non-Exclusive Start Date End Date
------------------------------------------------------------------------------------------------------------------------------------
Primus Products Third anniversary of
-------------------------------------------- Effective Date Effective Date or any
Primus(R) eServer/1/ Japanese and Yes No Japan Renewal Effective Date
English
----------------------------
Primus(R) eSupport/2/
------------------------------------------------------------------------------------------------------------------------------------
Primus(R) eServer/1/ Japanese and China Third anniversary of
English Korea Effective Date Effective Date or any
No Yes Hong Kong Renewal Effective Date
----------------------------
Primus(R) eSupport/2/
------------------------------------------------------------------------------------------------------------------------------------
Upstream Supplier Products
------------------------------------------------------------------------------------------------------------------------------------
On the termination or
Seagate Crystal Info v.6/3/ English and No Yes Japan and Effective Date last effective date of
Japanese Korea the authorizing
agreement between
Seagate and Primus
------------------------------------------------------------------------------------------------------------------------------------
KBI Total Product Support English No Yes Japan and Effective Date On the termination or
Suite Korea last effective date of
the authorizing
agreement between KBI
and Primus
====================================================================================================================================
Note 1: Primus(R) eServer is formerly known as SolutionSeries(TM) Server, SolutionBuilder(R) and SolutionExplorer(R)
Note 2: Primus(R) eSupport is formerly known as SolutionPublisher(R)
Note 3: Limited to Client License and Report/Query license (no OLAP license) and subject to the licensing and other restrictions
set forth in Schedule 7
Page 1 of 27
Table B - Software Distribution Fees and Support and Maintenance Fees
====================================================================================================================================
Product Language DISTRIBUTOR'S DISCOUNT FROM APPLICABLE LIST PRICE (%)
-------------------------------------------------------------------------------------
Aggregate Sales to a Specific Distributor's Discount from Support and
End User During an Annual Sales Applicable List Price For Orders Maintenance
Period by the Specific End User During Fees
(US $) the Annual Sales Period (%)
=================================================-----------------------------------------------------------------------------------
Primus Products Up to $99,999 37%
---------------------------- ---------------------------------------------------------------------
Primus(R) eServer/1/ $100,000 - $199,999 40%
and ---------------------------------------------------------------------
Primus(R) eSupport/2/ $200,000 - $299,999 43%
---------------------------------------------------------------------
$300,000 - $399,999 46%
---------------------------------------------------------------------
Japanese and $400,000 - $499,999 49% 50%
English ---------------------------------------------------------------------
$500,000 - $599,999 53%
---------------------------------------------------------------------
$600,000 - $699,999 56%
---------------------------------------------------------------------
$700,000 - $799,999 59%
---------------------------------------------------------------------
$800,000 - $899,999 62%
---------------------------------------------------------------------
$900,000 - $999,999 65%
---------------------------------------------------------------------
$1,000,000 and over 68%
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Upstream Supplier Products Price Per Unit Support and Maintenance Fees
------------------------------------------------------------------------------------------------------------------------------------
Seagate Crystal Info Set Japanese $1,400 per set 18%
------------------------------------------------------------------------------------------------------------------------------------
KBI Total Product Support English Intranet Web Server - $18,000/500 Concurrent User Pack 40%
Suite Client/Server - $800/Personal ID User
====================================================================================================================================
Note 1: Primus(R) eServer is formerly known as SolutionSeries(TM)Server,
SolutionBuilder(R) and SolutionExplorer(R)
Note 2: Primus(R) eSupport is formerly known as SolutionPublisher(R)
Note 3: Seagate Crystal Info Set refers to a set of Seagate products that
include Five (5) licenses of Tool Crystal Info. and One (1) License of
the Query Tool.
Table C - Services Fees
====================================================================================================================================
Service Description Location Fee per Labor Day (US $) Distributor's Discount Effective Period
From Applicable -------------------------
List Price Start Date End Date
------------------------------------------------------------------------------------------------------------------------------------
Primus Services
------------------------------------------------------------------------------------------------------------------------------------
Sales Training Seattle Applicable List Price TBD Effective Third
-------------------------------------------------------------------------------------------------------- Date Anniversary
Certification - Client Services Seattle Applicable List Price TBD of Effective
-------------------------------------------------------------------------------------------------------- Date or any
Certification - Technical Support Seattle Applicable List Price TBD Renewal
-------------------------------------------------------------------------------------------------------- Effective
Client Services United States Applicable List Price TBD Date
====================================================================================================================================
Table D - Distributor's Performance
====================================================================================================================================
Products Year of Net Annual Qualified Qualified Qualified Qualified Effective Period
Contract Revenues Sales Consultants Support Marketing ----------------------------
From (US $) Persons Engineers Staff Start Date End Date
Effective
Date
------------------------------------------------------------------------------------------------------------------------------------
Primus(R) eServer/1/ 1 4% of Primus
and Recognized
Primus(R) Revenue Effective Third
eSupport/2/ ------------------------------ 3 3 3 2 Date Anniversary
4% of Primus Of Effective
Recognized Date or any
2 and Revenue for Renewal
thereunder the respective Effective
year Date
====================================================================================================================================
Table E - Credit For Unsold TCI Inventory
====================================================================================================================================
Product Number of Unsold Units Credit per Unsold Unit Total Credit
as of Effective Date (US $) (US $)
------------------------------------------------------------------------------------------------------------------------------------
Primus SolutionBuilder 1,751 $770 $1,348,270
====================================================================================================================================
Page 2 of 27
Section 1. Definitions
For purposes of this Agreement, the following capitalized phrases shall be
ascribed the following meanings:
1.1 "Affiliate" means a Person in which another Person (i) owns equity
possessing at least fifty percent (50%) of the equity interest, or (ii) controls
equity possessing at least twenty percent (20%) of the total combined voting
power of all classes of equity entitled to vote.
1.2 "Applicable List Price" means Primus' then current list prices, as notified
by Primus to Distributor from time to time, for: (i) the Software; (ii) the
provision of technical support services and Updates; and (iii) any sales
training, certification or client services provided by Primus (except to the
extent specified otherwise in Table C).
1.3 "Confidential Information Agreement" means Primus' standard form Bilateral
Non-Disclosure Agreement, a copy of which is attached to this Agreement as
Schedule 1. "Confidential Information" shall have the meaning ascribed to it in
such agreement.
1.4 "Documentation" means the Software user, system administrator and technical
manuals and other documentation, including additional, updated or revised
documentation, if any, that Primus provides to Distributor.
1.5 "Effective Date" means January 1, 2000.
1.6 "End User" means any Person that acquires a license to use the Software for
production end user purposes, and not for redistribution, and that has executed
a License Agreement with Distributor or a Sub-Distributor.
1.7 "End User Maintenance" means the provision to End Users of technical
support services with respect to the Software, and the distribution of Updates
to End Users by Distributor or any sub-distributors, all in accordance with the
provisions of the Support and Maintenance Agreement. "End User Maintenance
fees" means the fees payable to Distributor by End Users for End User
Maintenance.
1.8 "Evaluation Agreement" means a form of software evaluation agreement that
is identical in all material respects to Primus' then current standard
evaluation license agreement for the Territory, the current form of which is
attached to this Agreement in Schedule 2. Primus may change the current form of
evaluation license agreement from time to time and at any time, upon prior
written notice to Distributor.
1.9 "Evaluator" means any Person that acquires a license to evaluate the
Software and that has executed an Evaluation Agreement.
1.10 "Exclusive Software" means the Software specified in Table A as being
subject to Distributor's exclusive distribution rights in the specified
Territory.
1.11 "Exclusive Territory" means the Japanese archipelago.
1.12 "Initial Software" means the first version of each Software product that
Primus delivers to Distributor pursuant to this Agreement, together with any
modifications thereof delivered to remedy any non-compliance with the warranties
under Sections 9.3.1-9.3.3.
1.13 "License Agreement" means a form of software license agreement that is
identical in all material respects to Primus' then current standard end user
license agreement for the Territory, the current form of which is attached to
this Agreement in Schedule 2. Primus may change the current form of end user
license agreement from time to time and at any time, upon prior written notice
to Distributor.
1.14 "Net Annual Revenue" means the amount of Software license and Primus
Maintenance fees actually paid by Distributor to Primus under this Agreement and
recognized by Primus as revenue for the respective year in accordance with
United States "Generally Accepted Accounting Principles", exclusive of shipping
charges, customs, import and export duties, value added taxes and other sales
taxes, and duties.
1.15 "New Software" means any versions of the Software delivered to Distributor
by Primus other than the Initial Software.
1.16 "Non-Exclusive Software" means the Software specified in Table A as being
subject to Distributor's non-exclusive distribution rights.
1.17 "Performance Goals" means the Performance Goals set forth in Table D and
Section 3.1.1.
1.18 "Person" means any individual, partnership, company, corporation, trust,
association or other entity or organization whatsoever.
1.19 'Primus Maintenance" means Primus' provision of support and maintenance to
Distributor, namely Secondline Support and Updates. Primus Maintenance fees
means the fees payable to Primus by Distributor for Primus Maintenance.
1.20 "Primus Software" means the object code version of Primus' computer
software programs (including any third party products licensed by Primus and
embedded in
Page 3 of 27
Primus' computer programs) identified in Table A as Primus products.
1.21 "Qualified Consultant" means a client services consultant employed by
Distributor who has completed a Primus client services certification course
within the past twelve (12) months.
1.22 "Qualified Sales Person" means a sales person employed by Distributor who
has completed a Primus sales training course within the past twelve (12) months.
1.23 "Qualified Marketing Staff" means Marketing professionals employed by the
Distributor experienced and competent in the development and implementation of
core marketing strategies and practices including competitive and market
research, direct marketing activities, corporate marketing activities, PR and
awareness activities, event planning and implementation, marketing collateral
creation, branding and messaging, and strategic planning and positioning.
1.24 "Qualified Support Engineer" means a technical support analyst employed by
Distributor who has completed a Primus technical support certification course
within the past twelve (12) months.
1.25 "Secondline Support" means Primus' obligations to provide technical
support to Distributor's technical support organization, as more particularly
described in Schedule 3.
1.26 "Software" means all or any portion of (i) the Primus Software, (ii) the
Upstream Supplier Software, and (iii) any Updates.
1.27 "Sub-Distributor" means any Person that distributes computer hardware or
software, or that provides related services, and that has executed a Sub-
Distribution Agreement with Distributor either (i) to make the Software and
Documentation available to End Users in conjunction with such Person's other
products or services, or (ii) to distribute the Primus Software and the Upstream
Supplier Software and Documentation on a stand-alone basis.
1.28 "Sub-Distribution Agreement" means a written agreement between Distributor
and each Sub-Distributor that provides the Sub-Distributor with certain sub-
licensing rights to the Software and Documentation, which rights shall not
exceed those granted to Distributor by Primus under this Agreement.
1.29 "Support and Maintenance Agreement" means a form of end user support and
maintenance agreement that is identical in all material respects to Primus' then
current standard end user support and maintenance agreement for the Territory,
the current form of which is attached to this Agreement in Schedule 2. Primus
may change the current form of end user support and maintenance agreement from
time to time and at any time, upon prior written notice to Distributor.
1.30 "Term" means the term of this Agreement, as more fully described in
Section 10.
1.31 "Territory" means the geographic areas of Japan, Korea, China and Hong
Kong specified in Table A.
1.32 "Trademarks" means: (i) Primus' trademarks Primus, Primus(R) eServer,
Primus(R) eSupport, Primus(R) Interchange, SolutionSeries, SolutionBuilder,
SolutionExplorer, SolutionPublisher and their associated logos; (ii) any
applicable Upstream Supplier Trademarks; and (iii) and any and all other
trademarks and/or service marks that Primus may use and approve in writing for
use by Distributor in connection with the Software.
1.33 "Updates" means new releases, major releases and maintenance releases of
the Software which Primus or the applicable Upstream Supplier does not designate
as different products for which it charges separately
1.34 "Upstream Supplier" means a third party that has granted Primus a license
to distribute and sub-license products developed by the third party (or its
licensors).
1.35 "Upstream Supplier Software" means the object code version of any Upstream
Supplier's computer software programs (including any third party products
licensed by the Upstream Supplier and embedded in such computer programs)
identified in Table A as Upstream Supplier products.
1.36 "Web Access Customers" means the end user customers of any End User who
access the server portions of the Software via the World Wide Web using a
browser interface, to retrieve information from (but not contribute information
to) the End User's database.
1.37 "Tables" means references to Tables include any subsequent Tables
(numbered X-0, X-0 and so forth) to which both of the parties agree in writing.
1.38 "Primus Recognized Revenue" means the annual budget for total recognized
revenue for Primus, on a worldwide basis, for the respective fiscal year as
approved by the Primus Board of Directors.
1.39 "Renewal Effective Date" means January 1, 2002 or two years subsequent to
the Effective Date for each automatic renewal of the Term as provided for and
more fully described in Section 10.
Section 2. Appointment as Distributor
2.1 Appointment. Subject to the provisions of this Agreement, Primus hereby
appoints Distributor, for the
Page 4 of 27
duration of the Term and throughout the world, as a distributor for the
marketing, distribution and sub-licensing of the Software to Persons whose head
offices are located in the Territory. The appointment shall be exclusive with
respect to the Exclusive Software, and non-exclusive with respect to the Non-
Exclusive Software. Distributor hereby accepts such appointment.
2.2 License Grants. Subject to the provisions of this Agreement, Primus hereby
grants to Distributor, and Distributor hereby accepts:
2.2.1 Marketing and Distribution: A limited, worldwide, non-transferable
license, with limited right to sub-license to Sub-Distributors, throughout the
Distribution Term, to (i) promote, market and demonstrate the Software and
Documentation to Persons located in the Territory, and (ii) distribute the
Software and Documentation throughout the Territory to End-Users and Evaluators
whose head offices are located in the Territory. The foregoing license shall be
an exclusive license with respect to the Exclusive Software and related
Documentation (subject to Section 2.2.4 below), and a non-exclusive license with
respect to the Non-Exclusive Software and related Documentation.
2.2.2 Right To Sub-License To End-Users and Evaluators: A limited,
worldwide, non-transferable license, with limited right to sub-license to Sub-
Distributors, throughout the Term, to sub-license the Software and Documentation
to End-Users and Evaluators whose head offices are located in the Territory. The
foregoing license shall be an exclusive license with respect to the Exclusive
Software and related Documentation (subject to Section 2.2.4 below), and a non-
exclusive license with respect to the Non-Exclusive Software.
2.2.3 Internal Use: A limited, worldwide, non-exclusive, non-transferable
license to reproduce, distribute and use the Software and Documentation for
Distributor's internal, non-production purposes during the Term, solely to the
extent reasonably necessary to enable Distributor to (i) promote, market and
demonstrate the Software, (ii) become familiar with the Software for purposes of
providing End User Maintenance to End Users and Evaluators, and (iii) make back-
up and archival copies.
2.2.4 Limitations on Exclusivity. Notwithstanding any provision of this
Agreement to the contrary, the grants from Primus to Distributor contained in
Section 2.1 and this Section 2.2 shall not be deemed to prohibit:
(i) the sub-licensing of the Software to an end user located within the
Territory by a Person located outside the Territory, provided that: (a) such
Person is authorized by Primus to license Software to its own Affiliates, and
the End User located in the Territory is an Affiliate of such Person, (b) such
Person is offering Software in combination with other products on an OEM or VAR
basis as an authorized distributor of Primus, or (c) the end user is a Web
Access Customer;
(ii) an End User's providing a Person located outside the Territory with
access to the server portions of the Software, provided that: (a) the server on
which the server portions of the Software are installed is under the custody and
control of the End User, and (b) such Person is either (x) an Affiliate of the
End User and is bound by the terms of the End User's License Agreement, or (y)
is a Web Access Customer of the End User;
(iii) the promotion and marketing of the Software via the Internet and on
the World Wide Web by Primus or any licensor, licensee or sub-licensee of
Primus; or
(iv) entering into a split transaction as contemplated by Sections 2.4
and 7.3.
2.3 Reservation. Primus reserves all rights to the Software, Documentation and
Confidential Information of Primus not expressly included in the scope of the
grant of rights to Distributor in this Agreement. Without limiting the
generality of the foregoing, Distributor shall use the Software only for the
purposes specified in Section 2.2 and in accordance with the following:
2.3.1 Modifications, Combinations and Translations. Without Primus'
specific, prior written consent, which Primus may provide or withhold in its
sole and absolute discretion, Distributor may not: (i) modify or create
derivatives of the Software or the Documentation; (ii) incorporate the Software
into any other computer software program; or (iii) translate any of the Software
or the Documentation. Primus may condition its consent upon Distributor's
written agreement to such commercial terms respecting (a) Distributor's
compensation for its efforts, and (b) technical specifications, as are mutually
acceptable to each of Primus and Distributor.
2.3.2 Ownership of Derivatives. Any modifications, translations or other
derivative works made to or derived from the Software or Documentation by
Distributor or any Person given access to the Software by Distributor, and all
related intellectual property rights (collectively, "Derivatives"), shall be
deemed to be work
Page 5 of 27
made for hire on behalf of Primus, and Primus shall be the sole owner of all
right, title and interest in and to such Derivatives. To the extent that
ownership of any Derivative does not vest in Primus by operation of law,
Distributor hereby assigns, and shall ensure assignment of all right, title and
interest in and to such Derivative to Primus. Upon request by Primus, and at
Primus' reasonable expense, Distributor shall execute all such written
agreements and instruments, and take all such other action as may be necessary
to perfect Primus' title in and to any Derivative. Nothing in this Section 2.3.2
shall be deemed to provide Primus with ownership rights in (i) products owned by
Distributor or its other licensors, and which Distributor combines with the
Software or the Documentation, or (ii) any know-how of Distributor that
Distributor uses to create any Derivative, except to the extent that such know-
how relates solely to the Software or Documentation.
2.3.3 Media. Unless Distributor first obtains Primus' prior written
consent, not to be unreasonably withheld, Distributor may only distribute the
Software to End-Users and Evaluators on CD-ROM or magnetic disk.
2.3.4 Appointment of Sub-Distributors. Before appointing any Sub-
Distributor, Distributor shall obtain Primus' written approval (not to be
unreasonably withheld) to an accurate English translation of Distributor's
proposed model Sub-Distribution Agreement (the "Model Agreement"). Subject to
Distributor's obtaining such approval, the initial Sub-Distributors shall be the
Persons listed in Schedule 4. Distributor may not appoint any other Sub-
Distributors without obtaining Primus' prior written approval (not to be
unreasonably withheld). Distributor's request for approval shall contain, at a
minimum: (a) the name and a description of the proposed Sub-Distributor; and (b)
an accurate English translation of the proposed Sub-Distribution Agreement,
marked to show changes from the Model Agreement. Distributor shall ensure that:
(i) Distributor may unilaterally terminate all Sub-Distributor appointments and
associated license rights upon termination of the Distribution Term, in each
case without any liability on the part of Primus; (ii) Sub-Distributors shall
have no right to appoint sub-distributors; (iii) the relevant Sub-Distribution
Agreement permits Distributor's assignment of the Sub-Distribution Agreement to
Primus or its nominee; (iv) each Sub-Distributor complies with the obligations
of Distributor under this Agreement, as though such obligations applied directly
to the Sub-Distributor; and (v) Primus is a third-party beneficiary of
Distributor's rights with respect to each of its Sub-Distributors.
2.3.5 No Conveyance of Ownership; Trade Secrets. This Agreement does not
convey any ownership of the Software or Documentation or any media on which the
Software or Documentation is stored, but only the right to transfer possession.
Title to copies of the Software and the Documentation distributed under this
Agreement shall remain with Primus at all times. Distributor acknowledges that
the Software, the Documentation and Primus' Confidential Information constitute
trade secrets and are the valuable property of Primus and its licensors, and
that the Software and Documentation are protected by copyright and trademark
rights.
2.3.6 Reverse Engineering. Except to the extent (if any) permitted by
applicable law, Distributor shall not decompile, or create or attempt to create,
by reverse engineering or otherwise, the source code from the object code
supplied under this Agreement.
2.3.7 Future Rights to Acquire Software. Distributor shall not grant to
any Person any option to sub-license the Software that can be exercised after
expiration of the Distribution Term.
2.3.8 Service Bureau. Distributor shall not rent or lease the Software,
and shall not use or distribute the Software to operate a service bureau or
similar service.
2.4 Licenses for Subsidiaries and Branch Offices of Parent Company Purchasers.
Notwithstanding any provision in this Agreement to the contrary and subject to
the provisions of Section 7.3: Primus may license Software to an End User
located within the Exclusive Territory that is a subsidiary or branch office of
a Parent Company which is a licensed End User located outside the Exclusive
Territory if such Software is sold to and paid for by the Parent Company located
outside the Exclusive Territory and subsequently delivered to the subsidiary or
branch office by the Parent Company. Similarly, Distributor or its Sub-
Distributors may sub-license Software to an End User outside the Exclusive
Territory that is a subsidiary or branch office of a Parent Company which is a
licensed End User located within the Exclusive Territory if such Software is
sold to and paid for by the Parent Company located within the Exclusive
Territory and subsequently delivered to the subsidiary or branch office by the
Parent Company. For purposes of this section, a branch office or subsidiary of
a Parent Company means an office or business entity that is majority owned
(greater than 50% owned) by the Parent Company
Section 3. Distributor's Obligations
Page 6 of 27
3.1 Sales Efforts. Throughout the Distribution Term, Distributor shall use its
best efforts to solicit orders from responsible and credit-worthy End Users
located in the Territory, for the licensing of the Software and the provision of
End User Maintenance. Without limiting the generality of the foregoing,
throughout the Distribution Term:
3.1.1 Performance Goals. Distributor shall use all commercially reasonable
efforts to: (i) generate Net Revenues in excess of those specified in Table D;
and (ii) ensure that sufficient employees of Distributor have attended Primus'
sales training, consulting and technical support certification courses, such
that Distributor employs no fewer than the number of Qualified Sales Persons,
Qualified Marketing Staff, Qualified Consultants and Qualified Support Engineers
specified in Table D throughout the Initial Term (collectively, the "Performance
Goals"). Without limiting Primus' other remedies, if Distributor fails to meet
any of the Performance Goals, then Primus may, after consultation with
Distributor, but in Primus' sole and absolute discretion, change any exclusive
appointment or license grant to a non-exclusive appointment or license grant.
3.1.2 Marketing Activities. Distributor shall: (i) engage in market
research for the purpose of identifying optimum marketing and distribution
strategies in the Territory; (ii) engage in a variety of marketing activities
including direct marketing activities, awareness and public relations
activities, event planning, strategic planning and marketing collateral
creation; (iii) advise Primus of all such measures as are necessary for the
localization of the Software; (iv) market and promote the Software in the
Territory, using the Trademarks; (v) coordinate sales, services and technical
support training programs with Primus; (vi) establish, train and maintain a
sales and services network with respect to the Software and (vii) ensure that
only Qualified Consultants and Qualified Technicians provide deployment,
technical support and other consulting services related to Primus' products.
3.1.3 Marketing Practices. Distributor shall avoid deceptive, misleading
or unethical practices that are or might be detrimental to Primus, its
licensors, or the Software, and shall conduct all activities under the Agreement
so as to maintain and support the reputation of Primus and Primus' products and
services.
3.1.4 Warranties. Distributor shall not make any representations or
warranties to any Person on behalf of Primus or Primus' licensors, nor assign
any representations or warranties that Primus makes to Distributor under this
Agreement to any Person. Distributor may provide its own warranties to End
Users with respect to the Software, but shall ensure that such warranties (and
any related remedies) do not exceed those provided by Primus to Distributor
under this Agreement.
3.2 End User Maintenance. Throughout the Distribution Term, Distributor or
Distributor's qualified sub-contractor, at Distributor's sole expense, shall
provide End Users with End User Maintenance.
3.3 Client Services. Throughout the Distribution Term, Distributor or
Distributor's qualified sub-contractor, at Distributor's sole expense, shall
provide End Users and Evaluators with such Software installation, implementation
and training services as are reasonably necessary to enable the End User or
Evaluator to use the Software successfully. Distributor shall use its
commercially reasonable efforts to obtain metrics from each End User regarding
the End User's use of, and success with the Software, and shall provide such
metrics to Primus. Primus shall provide Distributor with recommendations as to
the scope and nature of such metrics.
3.4 Agreements with Third Parties.
3.4.1 License, Support and Maintenance, and Evaluation Agreements.
Distributor shall not (i) distribute any Software or Documentation to End Users,
nor (ii) provide any End User with End User Maintenance, except under a valid
License Agreement and Support and Maintenance Agreement, respectively, executed
by the End User. Distributor shall comply with its obligations under all such
Agreements. Distributor shall ensure that all End Users comply with their
obligations under all such Agreements.
3.4.2 Evaluation Agreements. Distributor may order a reasonable number of
copies of the Software and Documentation from Primus, for supervised
demonstration and customer evaluation purposes. Distributor shall not distribute
any Software or Documentation to Evaluators except under a valid Evaluation
Agreement executed by the Evaluator. Distributor shall not be required to pay
Software license fees or Primus Maintenance fees for Software distributed
pursuant to an Evaluation Agreement; provided always that Distributor does not
permit any evaluation to extend beyond thirty (30) days without Primus' prior
written consent, not to be unreasonably withheld. Distributor shall ensure that
all Evaluators comply with their obligations under all such Agreements.
Page 7 of 27
3.4.3 Execution of Agreements. Distributor shall execute agreements with
Sub-Distributors, End Users and Evaluators only in its own name (and not that of
Primus). Distributor shall provide Primus with a copy of all License Agreements,
Support and Maintenance Agreements and Sub-Distribution Agreements executed by
End Users or Sub-Distributors promptly after their execution, containing at a
minimum the information required to be entered in each table of the License
Agreement and the Support and Maintenance Agreement.
3.4.4 Modifications to Agreements. Distributor may not modify the License
Agreement or the Support and Maintenance Agreement except as specified in this
Section 3.4.4.
(i) Material Changes. Distributor may make material changes to the License
Agreement or the Support and Maintenance Agreement, with Primus' prior written
approval, not to be unreasonably withheld or delayed. To obtain such approval,
Distributor shall submit an accurate English translation of the proposed changes
to Primus.
(ii) Immaterial Changes. Distributor may make immaterial changes to the
License Agreement and the Support and Maintenance Agreement at any time without
any obligation to obtain Primus' prior approval; provided always, however, that
Distributor shall defend, indemnify and hold Primus harmless from and against
any and all claims, loss, liability, damages and expense (including attorneys
and other expert's fees) incurred by Primus in consequence of such changes.
Distributor shall notify Primus of such changes when made.
3.5 Transactions Outside the Territory. If Distributor becomes aware that a
customer may require any Software outside the Territory, and if the exception to
territorial restriction specified in Section 2.2.4(ii) does not apply, then
Distributor shall promptly notify Primus.
3.6 Reports. Throughout the Term, Distributor shall: (i) provide Primus with
the plans, forecasts and reports, in English (collectively, "Reports"),
specified in this Section 3.6; (ii) ensure that each Report contains the minimum
information reasonably requested by Primus; and (iii) use all commercially
reasonable efforts to ensure the accuracy of each Report.
3.6.1 Business Plans. On or before October 15 of each year of the Term,
Distributor shall provide Primus with an annual business plan (based on a
December 31 year end) for the distribution of the Software and the provision of
End User Maintenance by Distributor and Sub-Distributors in the Territory.
Distributor shall also provide Primus with a business plan for any new business
initiative that the Distributor wishes to undertake that requires the assistance
of Primus.
3.6.2 Monthly Forecasts. On or before the fifth (5th) day of each calendar
month, Distributor shall provide Primus with a quarterly forecast for the
current month and subsequent two (2) months, for the sub-licensing of the
Software and provision of End User Maintenance in the Territory.
3.6.3 Monthly Reports. On or before the fifteenth (15th) day of each
calendar month, Distributor shall provide Primus with a report specifying: (i)
the sub-licensing of the Software and provision of End User Maintenance to End
Users in the Territory for the calendar month last ended: (ii) the status of all
Evaluation Agreements in effect in the Territory for the calendar month last
ended, and the related evaluations by potential customers; and (iii) metrics
regarding use of the Software by End Users.
3.7 Accounting. Throughout the Term and until the sixth (6th) anniversary of
its termination, Distributor shall keep complete and accurate records clearly
showing: (i) in accordance with Japanese generally accepted accounting
principles and on a consistent basis, all revenues arising out of the
distribution of the Software and the provision of End User Maintenance by
Distributor and the Sub-Distributors; (ii) all amounts payable to Primus under
this Agreement; and (iii) the location, model name, and serial number of all
servers on which the Software distributed by Distributor or any Sub-Distributor
is installed. Such records, and those specified below, are collectively referred
to in this section as "Distribution Records".
3.7.1 Records. For each License Agreement, Support and Maintenance
Agreement and Sub-Distribution Agreement executed, the Distribution Records
shall include at a minimum: (i) the name and address of the End User or Sub-
Distributor; (ii) the dates of shipment; (iii) a copy of each such Agreement,
and each purchase order and invoice, including all amendments and exhibits; (iv)
records of revenues received and receivable in respect of End User Maintenance
and the period to which such End User Maintenance revenues apply; and (v) in the
case of Sub-Distributors only, a copy of each monthly Sub-Distributors' revenue
report to Distributor.
3.7.2 Audit Rights. Within ten (10) days of Primus' written request,
Distributor shall provide accurate copies of the requested Distribution
Records or any
Page 8 of 27
requested information contained in the Distribution Records to Primus in
English; provided, however, that Primus may request such information no more
frequently than once per quarter. Upon ten (10) days prior written notice,
Primus may inspect, audit, and copy the Distribution Records and access the
servers on which the Software is installed, at any time during the regular
business hours of the user thereof, but only for the purposes of determining
that (i) Primus has been properly paid all fees to which it is entitled under
this Agreement, and (ii) no infringement of Primus' intellectual property rights
with respect to the Software, the Documentation or the Trademarks has occurred.
Unless an audit discloses a material discrepancy in favor of Distributor or any
of its sub-distributors, Primus may exercise such audit rights no more than once
during any twelve (12) month period. In the event of any understatement of any
Software license fees or Primus Maintenance fees due to Primus, Distributor
shall promptly pay such fees at the Applicable List Price. This remedy and
Primus' acceptance of any payment shall be without prejudice to any additional
rights or remedies of Primus under this Agreement or applicable law.
3.7.3 Log Files. Upon written request by Primus, Distributor shall
transmit to Primus a current, complete and correct copy of the log file for each
server on which the Software is installed; provided, however, that unless review
of a log file has indicated additional fees are due to Primus, Primus may not
request a copy of any one log file more frequently than once a year.
3.8 Governmental Compliance.
3.8.1 Regulatory Approvals. Distributor shall obtain and maintain all
licenses, permits, certificates and authorizations required to perform its
obligations under this Agreement, including without limitation those required
for: (i) Distributor's appointment and performance as distributor and licensee
of Primus, and that of any Sub-Distributors; and (ii) the import of the Software
and Documentation into the Territory. All regulatory and other approvals which
are obtained for the Software by Distributor shall be obtained on behalf of
Primus and for Primus' sole benefit. Distributor represents that no regulatory
approvals which have not already been obtained by Primus and/or Distributor are
presently required for licensing and distribution of the Software in the
Territory.
3.8.2 US Export Control. Distributor shall comply with all then applicable
US export control laws and regulations in connection with its distribution of
the Software and Documentation, and the disclosure of any technical information
related thereto.
3.8.3 U.S. Foreign Corrupt Practices Act. Distributor shall comply with
the requirements of the U.S. Foreign Corrupt Practices Act ("FCPA"), and shall
not take nor omit to take, directly or indirectly, any action that might cause
Primus to be in violation of the FCPA.
3.8.4 Foreign Exchange Controls. Distributor shall be solely responsible
for compliance with any foreign exchange controls affecting the Territory.
3.9 Primus' Intellectual Property Rights.
3.9.1 Primus' Ownership. Distributor shall not represent to any Person
that it has any ownership interest in the Software, Documentation, Trademarks or
Primus' Confidential Information. Distributor acknowledges that no action by it
or on its behalf shall create in Distributor's favor any right, title or
interest in or to the Software, Documentation, Trademarks, and/or Primus'
Confidential Information, or in any registrations, filings, renewal or
enforcement rights of Primus pertaining to them.
3.9.2 Notice of Third Party Infringement. Distributor shall promptly
advise Primus of any suspected or actual infringements of Primus' intellectual
property rights of which Distributor becomes aware. Distributor shall cooperate
with and assist Primus, at Primus' reasonable expense, in any action undertaken
by Primus against any suspected infringement by third parties.
3.9.3 Notice by Primus. Distributor shall not market, display, reproduce,
distribute, sub-license or use the Software or Documentation for a period of
three (3) months commencing on Primus' notice to Distributor that Distributor
should cease use or distribution of the Software due to an infringement claim.
3.9.4 Intellectual Property Rights Registration. Distributor shall, at
Primus' reasonable expense, provide Primus with all assistance reasonably
required by Primus to register Primus throughout the Territory as the owner of
Primus' intellectual property rights with respect to the Software and the
Documentation, including without limitation the Trademarks.
3.10 Costs and Expenses. Distributor shall bear and be liable for all costs and
expenses that it initiates or incurs in fulfilling its obligations under this
Agreement, except as otherwise expressly specified in a written agreement
executed by both parties.
Section 4. Primus' Obligations
4.1 Training. Following execution of this Agreement, and at such other times
during the Term as Primus reasonably determines (for example, upon Primus'
Page 9 of 27
release of a significant Update), Primus shall provide the training to
Distributor and Sub-Distributors as specified below, at Primus' then current
rates for such services at locations mutually acceptable to both parties, or, to
the extent indicated in Table C, at the rates, discounts and locations specified
in Table C. To the extent Table C provides for a rate or discount to be
determined (TBD) the parties will work in good faith to determine a mutually
agreeable arrangement.
4.1.1 Sales Training. Primus shall provide such sales and pre-sales
information and training as Primus reasonably determines necessary, after
consultation with Distributor, for the promotion, marketing and demonstration of
the Software by Distributor.
4.1.2 Certification Training. Primus shall provide such product
certification training (covering client services and technical support skills
for the Software) as Primus reasonably determines necessary, after consultation
with Distributor.
4.2 Updates. During the Distribution Term, Primus shall (i) provide Distributor
with reasonable prior notice concerning the release of all Updates, and (ii)
provide Distributor with Updates if and when they are generally available for
commercial release in the Territory. Distributor shall not entitle any End User
to any Updates until the Update is generally available for commercial release.
4.3 Secondline Support. During the Term, Primus shall provide Distributor with
Secondline Support. Primus shall have no obligation to directly support End
Users or Sub-Distributors. Primus need not provide any other technical support
except on a basis acceptable to Primus.
4.4 Marketing Materials. During the Term, Primus shall provide Distributor with
initial copies of Primus' marketing materials and price lists applicable to the
promotion, marketing and distribution of the Software in the Territory, together
with any updates created by Primus. Distributor shall be responsible for the
costs of reproducing any such materials.
4.5 Referrals. During the Term, to the extent that Distributor has exclusive
rights as Primus' distributor of the Software, Primus shall forward to
Distributor any inquiry or order with respect to the Software that Primus has
received, and that originates from the Territory.
Section 5. Other Obligations Of The Parties
5.1 Tax Structuring. Throughout the Term, Primus and Distributor shall consult
and work together to determine the most mutually tax-efficient structure for
distribution of the Software within the Territory, and for payment of all fees
to Primus. To the extent there is any Japanese withholding tax liability for
transactions between Primus and Distributor in connection with this Agreement,
Primus and Distributor will split such liability equally.
5.2 No Authority. Neither of the parties shall have any authority to bind or
act for, or assume any obligation or responsibility on behalf of, the other
party, except as such authority may be specifically and expressly delegated in
this Agreement. The parties hereto do not intend, and this Agreement shall not
be deemed to create a partnership, joint venture, franchise, employment or other
relationship between them.
5.3 Confidential Information. Each of the parties shall comply with the
provisions of the Confidential Information Agreement.
5.4 Future Primus Products. In the event Primus introduces into the Exclusive
Territory, products other than the Primus Products for which Distributor has
been granted an Exclusive License pursuant to this Agreement, Primus intends to
grant Distributor an exclusive license to market and distribute such products in
the Exclusive Territory provided that Distributor has met all Performance Goals
established pursuant to this Agreement and provided further that Distributor and
Primus reach an Agreement as to the terms of a Marketing and Distribution
Agreement for such other products.
Section 6. Ordering and Shipment
6.1 Order Submission. Distributor shall order Software and Documentation from
Primus by delivering to Primus: (i) a Distributor purchase order, substantially
in the form attached as Exhibit A; and (ii) a copy of a valid End User purchase
order issued to Distributor or any Sub-Distributor; (iii) if applicable, any
Sub-Distributor purchase order; and (iv) the License Agreement and Maintenance
Agreement executed by the End-User. Sub-Distributors and End Users may not order
Software or Documentation directly from Primus.
6.2 Order Acceptance. Primus shall accept all reasonable orders from
Distributor for Software and Documentation that are in accordance with the terms
of this Agreement. Distributor may not cancel or amend an order once it has been
received by Primus without Primus' prior written consent.
6.3 Delivery. Primus shall deliver orders of Software and Documentation
accepted by Primus to Distributor FCA Seattle. The trade term "FCA" shall be
interpreted in
Page 10 of 27
accordance with "Incoterms 1990", as promulgated by the International Chamber of
Commerce.
6.4 Customs and Taxes. Distributor shall be responsible for clearing Software
and Documentation through all customs, and shall pay any and all taxes or duties
imposed by any governmental authority on (i) the export or import of the
Software or Documentation, and (ii) the licensing of the Software within the
Territory.
Section 7. Fees and Payments
Except to the extent expressly stated otherwise in this Agreement, Distributor
shall pay Primus at the Applicable List Price, less Distributor's Discount, for:
(i) all Software and Documentation distributed under this Agreement; (ii) all
Primus Maintenance provided under this Agreement; and (iii) all client services
provided by Primus to Distributor (including, for example, but without
limitation, consulting and educational services).
7.1 Software and Primus Maintenance Fees Payable to Primus. Distributor shall
pay Primus Software license fees and Primus Maintenance fees on Software sub-
licensed to End Users and End User Maintenance purchased by End Users in
accordance with the payment terms of Section 7.7. Distributor shall pay Primus
(i) the Software license fees and Primus Maintenance fees for such order at the
Applicable List Price, less Distributor's Discount in accordance with Table B,
and (ii) all related shipping charges, taxes and duties.
7.1.1 Distributor's Discount Applicable to Volume Sales to Specific End
User In the event sales of Primus Products by Distributor to a specific End User
equal or exceed $100,000 (based on Applicable List Price) during an Annual Sales
Period for that End User, the Distributor's Discount applicable to orders for
that End User during that Annual Sales Period shall be determined in accordance
with Table B. Solely for purposes of determining distributor's discount in
accordance with this section, a sub-distributor of Distributor shall be deemed
as an End User provided that Distributor has no ownership interest in such sub-
distributor. The Distributor shall determine the aggregate sales made to an End
User during the Annual Sales Period, including the value of the then current
order, and shall apply the Distributor's Discount from Table B associated with
that aggregate sales amount, to the then current order for that End User. The
initial Annual Sales Period is defined as the calendar period beginning on the
date, after the Effective Date, of the first sale to that End User and ending
twelve months later. Thereafter, for the duration of this Agreement, subsequent
Annual Sales Periods will commence upon the expiration of the previous Annual
Sales Period and end twelve months later. With respect to customers who have
placed orders prior to the Effective Date, Primus agrees to the retroactive
application of the terms described in this section 7.1, such that the Annual
Sales Period for such customers shall be deemed to have begun on the date that
is nine months prior to the date of that customer's first order after the
Effective Date.
7.2 No Charge for Internal Use and Evaluations. Distributor shall not be
required to pay Primus Software license fees or support and maintenance fees
with respect to: (i) Software that Distributor uses internally pursuant to the
internal use license granted under Section 2.2.4; and (ii) Software used by
Evaluators; provided always, however, that Distributor does not permit any
evaluation to extend beyond thirty (30) days without Primus' prior written
consent, not to be unreasonably withheld.
7.3 Splits. In the event Primus licenses any Software to an End User in
accordance with Section 2.4, which Software will be located and supported in the
Exclusive Territory, or if Distributor sub-licenses any Software to an End User
in accordance with Section 2.4, which Software will be located and supported
outside the Exclusive Territory, then Primus and Distributor shall split equally
between them the Software license fees and support and maintenance fees payable
by the End User with respect to such Software. In the event of any multiple-
territory transaction where there is a conflict between Distributor and Primus'
other distributors, agents or representatives which cannot be mutually resolved,
then Primus may, in its sole and absolute discretion, allocate the Software
license fees, End User Maintenance fees, and the responsibility for providing
End User Maintenance among them (less, in the case of Distributor, any
compensation payable to Primus under this Agreement).
7.4 Distributor's Own Software Use. Distributor shall be entitled to the
benefit of its Distributor's Discount for any Software that it acquires during
the Distribution Term for its own production use.
7.5 Client Services. Distributor may request Primus to provide pre-sales,
installation, implementation, training and integration services to any
Distributor or any End User. If Primus, in its sole discretion, accepts such
request, then Distributor shall pay Primus the Applicable List Price for such
services, less the Distributor's Discount, together with travel and living
expenses reasonably incurred by Primus in providing such services.
Page 11 of 27
7.6 Applicable List Price; Distributor's Discount. The Applicable List Price
contains a list of Software license and End User Maintenance fees recommended by
Primus for use by Distributor in distributing the Software and providing End
User Maintenance in the Territory. If Distributor wishes to sub-license Software
or provide End User Maintenance at less than the Applicable List Price, or if
Distributor wants to provide any Person with an option to acquire rights to the
Software or End User Maintenance at less than the Applicable List Price, then
Distributor shall first provide Primus with not less than five (5) business days
prior written notice. Notwithstanding any of the foregoing, Distributor shall be
under no obligation to sub-license the Software or provide End User Maintenance
to End Users at the Applicable List Price, but may price the Software and End
User Maintenance in its reasonable discretion.
7.7 Payment Terms. Unless another date is specified in this Agreement, all
payments by Distributor to Primus shall be due within thirty (30) days of the
date of Primus' invoice. Distributor shall make all payments in United States
currency, in readily available funds. Overdue payments shall accrue interest at
the lesser of US prime rate on the date of the invoice plus five percent (5%)
per annum, or the maximum rate permitted by applicable law. If any sums require
conversion into US currency, then the conversion rate shall be that published in
the Wall Street Journal for the fifteenth day of the month in which Primus
delivers its invoice to Distributor or, if no rate is published for the
fifteenth day, the next day on which the rate is published.
7.8 Taxes. As between Distributor and Primus, Distributor shall be solely
responsible for any applicable sales, use, or any value added or similar taxes
(collectively, "Sales Taxes") payable under, or arising out of or in connection
with this Agreement, other than taxes imposed in the United States based upon
Primus' income. Any prices, fee schedules or invoices provided by Primus are
exclusive of any Sales Taxes, unless specifically stated otherwise. If
Distributor has tax-exempt status, Distributors shall provide written evidence
of such status with its purchase orders, in form and content reasonably
satisfactory to Primus. Upon request by Primus, Distributor shall promptly
furnish Primus with copies of tax receipts and other documents evidencing the
withholding and payment of any local taxes applicable to Primus, so that Primus
may file for a tax credit. Distributor shall cooperate with Primus in taking all
such steps and filing all such documents as Primus reasonably requests to
minimize any such withholding.
7.9 Unsold TCI Inventory. License fees payable by Distributor to Primus
pursuant to this Section 7 will be offset by the Credit For Unsold TCI Inventory
indicated on Table E, subject to the limitations of this Section 7.9. Any
amounts payable by Distributor to Primus, for orders of Primus Products during
the period beginning on the Effective Date and ending seven months thereafter,
up to the amount of the Total Credit indicated on Table E, shall be offset by
the Credit for Unsold TCI Inventory. The Credit for Unsold TCI Inventory shall
expire and not apply to any license fees payable for sales of Primus Products
which are made later than seven months after the Effective Date. Distributor
shall have no rights to take any credit for such Unsold TCI Inventory after the
date which is seven months after the Effective Date, or to acquire or sell any
Unsold TCI Inventory.
Section 8. Trademark Matters
8.1 License to Use Trademarks. Primus hereby grants Distributor a non-exclusive
license, with right to sub-license to Sub-Distributors, to use the Trademarks in
the Territory during the Term, solely in connection with: (i) the promotion,
marketing, licensing, and distribution of the Software; and (ii) the provision
of End User Maintenance and of implementation and training services related to
the Software. Primus reserves all other rights to the Trademarks.
8.2 Proprietary Notices; Use of Trademarks; Approval of Promotional Materials.
Distributor shall not remove, obscure or alter any notice of copyright, trade
secret, trademark or other proprietary right appearing in or on any Software or
Documentation or any related packaging and shall ensure that each copy of all or
any portion of the Software or Documentation made by Distributor includes such
notices. Distributor shall clearly indicate the ownership of the Trademarks by
Primus whenever it uses the Trademarks. Distributor shall comply with the
trademark usage guidelines and procedures established by Primus from time to
time. Upon request by Primus, Distributor shall provide Primus with an
opportunity to inspect and approve any packaging, descriptive or promotional
materials pertaining to the Software and Documentation or otherwise containing
references to the Trademarks. Distributor may appropriately use its own
trademarks and trade names in connection with distributing the Software, subject
to Primus' prior written approval. Any goodwill arising out of use of the
Trademarks by Distributor or any Sub-Distributor shall inure solely to the
benefit of Primus.
Page 12 of 27
8.3 No Infringement. Distributor shall not at any time adopt, use or register
any identical or similar xxxx or symbol or combination thereof which infringes
any of the Trademarks. If Distributor has already done or attempted to do so,
directly or indirectly, Distributor shall immediately assign all rights to such
xxxx or symbol to Primus. In no event shall Distributor use the name "Primus" or
any of the Trademarks (whether or not registered) except as expressly permitted
under this Agreement.
Section 9. Warranties
9.1 Distributor's Warranties. Distributor represents and warrants to Primus as
follows:
9.1.1 Authority. The execution and delivery of this Agreement by
Distributor and the performance of the obligations contemplated hereby have been
duly and validly authorized by all necessary legal action on its part, and this
Agreement is legal, valid and binding against Distributor in accordance with its
terms.
9.1.2 No Default. The execution, delivery and performance of this
Agreement by Distributor does not and shall not conflict with any obligation of
Distributor under any agreement or instrument to which Distributor is a party or
by which it is bound.
9.1.3 Adequate Resources. Distributor has sufficient resources and
experience to properly perform its obligations under this Agreement, and shall
commit such resources to its obligations throughout the Term. None of
Distributor's executive officers have any actual knowledge of any existing or
forthcoming event that may materially adversely affect Distributor's ability or
willingness to comply with its obligations under this Agreement.
9.2 Primus' Warranties. Primus represents and warrants to Distributor as
follows:
9.2.1 Organization and Authority. The execution and delivery of this
Agreement by Primus and the performance of the obligations of Primus
contemplated hereby have been duly and validly authorized by all necessary legal
action on its part, and this Agreement is legal, valid and binding against
Primus in accordance with its terms.
9.2.2 No Default. The execution, delivery and performance of this
Agreement by Primus does not and shall not conflict with any obligation of
Primus under any agreement or instrument to which Primus is a party or by which
it is bound.
9.3 Primus Software Warranties.
9.3.1 Media. Primus warrants to Distributor that the media on which the
Primus Software is delivered by Primus will be free from defects in materials
and workmanship for a period of ninety (90) days beginning on the date of
shipment by Primus.
9.3.2 Performance; Year 2000. Primus warrants to Distributor that the
Primus Software as delivered by Primus: (i) will perform in all material
respects in accordance with the applicable specifications set forth in the
applicable Documentation for a period of ninety (90) days beginning on the date
of shipment by Primus; and (ii) is "Year 2000 Compliant." Year 2000 Compliant
for the purposes of this Section 9.3.2 means that the Primus Software, when used
with accurate date data and in accordance with its associated documentation, is
capable of properly processing date data from, into and between the twentieth
and twenty-first centuries, including the years 1999, 2000 and leap years,
provided that all other products (e.g., hardware, software and firm-xxxx) used
with it properly exchange date data with the Primus Soft-xxxx.
9.3.3 Infringement. Primus warrants to Distributor that use in accordance
with this Agreement of the Primus Software as delivered by does not infringe:
(i) to the best of Primus' knowledge, any valid copyright in any country in the
Territory, or (ii) to Primus' actual knowledge, any patent or trademark existing
under the laws of any country in the Territory.
9.3.4 Upstream Supplier Software Warranties. Primus warrants to
Distributor that the Upstream Supplier Software, as delivered by Primus to
Distributor, will conform to the warranties specified in Schedule 5.
9.3.5 Bugs and Abatement. Without limiting the foregoing, Primus does not
warrant that the Software is free from all bugs, errors, or omissions. The
warranties in this Section 9.3 shall automatically xxxxx to the extent that the
Software has been damaged, abused, modified, or combined with other software by
Persons other than Primus' authorized employees or representatives, or other
than at Primus' express direction.
9.3.6 Performance Remedy. If any Software fails to comply with the
warranties set forth in Sections 9.3.1 and 9.3.2, and paragraphs A.1, A.2 , B.1
and B.2 of Schedule 5, and if Distributor provides written notice of the non-
compliance to Primus within five (5) business days of expiration of the warranty
period then, except as otherwise specified in Schedule 5, Primus will either
repair or, at its option, replace any non-complying media or Software. If Primus
is unable to correct the
Page 13 of 27
noncompliance within sixty (60) days of receipt of such written notice from
Distributor then, except as otherwise specified in Schedule 5, Primus shall, as
Distributor's sole remedy, (i), with respect to non-compliant Initial Software,
promptly refund all of the Software license fees paid by Distributor for such
Software and terminate the Distribution Term with respect to the non-compliant
Software, and (ii), with respect to non-compliant New Software, promptly refund
all of the most recent annual support and maintenance fees paid by Distributor
to Primus and attributable to the development of such New Software, in each case
(i) and (ii) in full and final satisfaction of all and any of Distributor's
claims arising out of media or Software failure.
9.3.7 Infringement Remedy. Primus shall defend and indemnify Distributor
against any proceeding based upon any failure to satisfy the warranties set
forth in Section 9.3.3 and paragraphs A.3 and B.3 of Schedule 5, as
Distributor's sole remedy, provided that: (i) Distributor shall notify Primus in
writing of any claim of infringement promptly after it has been made; (ii)
Primus or its licensors shall have exclusive control over the defense and
settlement of the proceeding; (iii) Distributor shall make no admission of
liability nor enter into any settlement without the prior written agreement of
Primus; (iv) Distributor shall provide such assistance in defense of the
proceeding as Primus or its licensors may reasonably request, at Primus'
reasonable expense; and (v) Distributor shall comply with any court order or
settlement made in connection with the proceeding. If use of the Software is, or
in Primus' reasonable opinion is likely to become, the subject of a claim of
infringement of any intellectual property right of any third party, then Primus
may: (a) procure the continuing right of Distributor to use the Software; (b)
replace or modify the Software in a functionally equivalent manner so that it no
longer infringes; or (c) except as otherwise specified in Schedule 5, terminate
the Distribution Term with respect to the Software subject to the infringement
claim and refund to Distributor an amount equal to the depreciated license fees
paid by Distributor for such Software (calculated on a straight line basis over
a five (5) year life).
9.3.8 Warranties Repeated For Replacements and New Software. The
warranties and other provisions of this Section 9.3 shall be automatically
repeated for any modifications of the Software delivered to remedy any non-
compliance with the warranties under Sections 9.3.1 and 9.3.2 and for any New
Software, in each case upon shipment of the same by Primus to Distributor.
9.3.9 Disclaimer Of Implied Warranties. Primus makes no representation or
warranty in connection with the Software, except as set forth in Sections 9.3.1
- 9.3.4. EXCEPT AS SPECIFICALLY SET FORTH IN THIS SECTION 9.3, AND EXCEPT FOR
DEATH OR BODILY INJURY THAT RESULTS FROM PRIMUS' PROVEN WILLFUL MISCONDUCT OR
NEGLIGENCE, PRIMUS DISCLAIMS AND DISTRIBUTOR WAIVES AND RELEASES ALL RIGHTS AND
REMEDIES OF DISTRIBUTOR, AND ALL WARRANTIES, OBLIGATIONS, AND LIABILITIES OF
PRIMUS, EXPRESS OR IMPLIED, ARISING BY LAW OR OTHERWISE, WITH RESPECT TO ANY
BUG, ERROR, OMISSION, DEFECT, DEFICIENCY, OR NONCONFORMITY IN ANY SOFTWARE OR
OTHER ITEMS FURNISHED UNDER THIS AGREEMENT OR THE SUPPORT AND MAINTENANCE
AGREEMENT, INCLUDING BUT NOT LIMITED TO ANY: (A) IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE; (B) IMPLIED WARRANTY
ARISING FROM COURSE OF PERFORMANCE, COURSE OF DEALING, OR USAGE OF TRADE; (C)
CLAIM OF INFRINGEMENT; AND (D) STATUTORY REMEDIES.
Section 10. Term and Termination
10.1 Term and Automatic Renewal. Unless sooner terminated pursuant to Sections
10.1.1 and 10.1.2 below, or as provided elsewhere in this Agreement, the Term of
this Agreement shall expire as specified in Table A. Expiration of the Term
shall not, in and of itself, cause the termination of License Agreements with
End-Users. The expiring Term shall automatically renew for a period of two
succeeding calendar years if Distributor has met or exceeded its Performance
Goals for both year 1 and year 2 from the Effective Date of this Agreement, and
in such event, a Renewal Effective Date shall be established. The Renewal
Effective Date will be substituted for the Effective Date in the preceding
sentence and the same methodology will be used to assess Distributor's
achievement of Performance Goals for subsequent years and further extension(s)
of the Term. In the event Distributor does not achieve Performance Goals for any
year subsequent to the Renewal Effective Date, the Agreement shall expire at the
end of its then current Term, unless Primus elects at its sole discretion to
extend the Term. Distributor's achievement of Performance Goals only for year 2
and year 3 from Effective Date of this Agreement will not result in automatic
renewal, but will given significant consideration by Primus as part of its
evaluation process for discretionary renewal.
Page 14 of 27
10.1.1 Earlier Termination by Either Party. Either party may immediately
terminate the Term at any time if: (i) any proceedings are commenced by, for or
against the other party under any bankruptcy, insolvency or debtor relief law
and are not dismissed within thirty (30) days; or (ii) the other party has
materially breached its obligations under this Agreement and has not cured such
failure within thirty (30) days of notification of the breach by the non-
breaching party.
10.1.2 Earlier Termination by Primus. Primus may immediately terminate the
Term at any time if: (i) Distributor has engaged in the development or
distribution of any product which competes with the Software; (ii) Distributor
has challenged the validity or exclusivity of any of the intellectual property
rights of Primus or its licensors (including without limitation the Trademarks
and/or Primus' Confidential Information); or (iii) Distributor has failed to
make a payment when due under Section 7 above, and has not cured such failure
within ten (10) business days following written notice from Primus; or (iv) the
ownership of fifty percent (50%) or more of the Distributor is sold or otherwise
transferred.
10.2 Local Termination Liabilities. Primus shall have no liability for early
termination of the Term in accordance with the provisions of this Agreement,
including without limitation any liability for goodwill that has been
established, or for any damages on account of prospective profits or anticipated
sales. Distributor waives, and shall ensure that each Sub-Distributor waives any
and all rights, claims and causes of action against Primus arising out of any
such termination.
Section 11. Post Termination Obligations
Upon any termination of the Term:
11.1 Distributorship. Distributor shall immediately: (i) pay Primus any sums
that are outstanding under this Agreement, the due dates of which shall be
automatically accelerated to the date of termination; (ii) discontinue any
representations that it is an authorized distributor of the Software or of
Primus; and (iii) except to the extent required by Distributor to provide End
User Maintenance to End Users, permanently delete all copies of any of the
Software from the hard drives of all computers in Distributor's possession or
under its control, destroy all other media in Distributor's possession or under
its control on which any of the Software is stored, certify the same in writing
to Primus, and return to Primus all copies of the Documentation and Primus'
Confidential Information then in Distributor's possession or under its control.
11.2 Inventory. Primus shall refund to Distributor the fees paid by Distributor
for any Documentation and any related packaging that Distributor returns to
Primus within thirty (30) days of termination of the Term or this Agreement, but
only to the extent that (i) the Documentation and related packaging is in the
same condition as it was when shipped to Distributor, and (ii) the Documentation
and related packaging is for the then current versions of the applicable
Software.
11.3 Interim Orders. Primus may (i) reject all or part of any orders received
from Distributor after notice but prior to the effective date of termination, or
(ii) require Distributor's performance of any outstanding orders,
notwithstanding the fact that delivery dates for such orders may extend beyond
the effective date of termination.
11.4 Ongoing Installation Programs. With Primus' prior written consent, not to
be unreasonably withheld or delayed, Distributor shall complete all
implementation and training programs which, prior to receiving notice of
termination, it had agreed to provide to End Users.
11.5 Assignment of Agreements. Distributor shall offer to assign to Primus or
Primus' designee all License Agreements, Evaluation Agreements, Support and
Maintenance Agreements and Sub-Distribution Agreements entered into by
Distributor or any Sub-Distributor. To the extent that Primus or its designee
accept such assignment:
11.5.1 Primus' Assumption of Obligations. Primus or its designee shall
assume Distributor's obligations: (i) to End Users under License Agreements and
Support and Maintenance Agreements, (ii) to Evaluators under Evaluation
Agreements, and (iii) to Sub-Distributors under Sub-Distributor Agreements.
11.5.2 End User Installment Payments. Primus shall pay to Distributor all
fees paid to Primus under the assigned agreements by the End User, Evaluator or
Sub-Distributor (the "Pre-Assignment Fees"), but only to the extent that
Distributor has already paid Primus the fees due under this Agreement for the
Software or support and maintenance to which the Pre-Assignment Fees relate.
11.5.3 End User Prepayments. Distributor shall pay to Primus or Primus'
designee the amount representing the unused portion of all End User Maintenance
fees that have been prepaid by End Users as of the assignment date, less Primus
Maintenance fees for such unused portions that Distributor has already paid to
Primus. Unused portions of support and maintenance fees shall be determined by
multiplying the total fees for
Page 15 of 27
the relevant term (the "Relevant Term") by a fraction, the numerator of which is
the number of days of the Relevant Term remaining, and the denominator of which
is the total number of days of the Relevant Term.
Section 12. Indemnification
Distributor shall defend, indemnify and hold Primus harmless from and against
any loss, liability, damages or expense (including attorneys' and other experts'
fees) incurred by Primus and arising out of: (i) any warranty, representation,
indemnity, guarantee or similar assurance, and any related remedy, provided by
Distributor or any Sub-Distributor with respect to the Software, the
Documentation or the End User Maintenance to the extent that any of them exceed
the warranties and remedies provided by Primus to Distributor under Section 9.3
of this Agreement; (ii) any omission or inaccuracy in Distributor's or Sub-
Distributor's verbal or written statements, advertisements and promotional
materials that relate to Primus, the Software, the Documentation or the End User
Maintenance; or (iii) any failure by Distributor or any Sub-Distributor to
comply promptly with their obligations under the provisions of this Agreement
headed "Governmental Compliance" (Section 3.8) and "Taxes; Withholding."
(Section 7.8).
Section 13. Dispute Resolution and Other Provisions; Schedules
13.1 Dispute Resolution and Other Provisions. Dispute resolution and other
provisions are contained in Schedule 6.
13.2 Schedules. Each of the Schedules and Exhibits listed below shall be
incorporated into and shall for all purposes be deemed a part of this Agreement:
Schedule 1 - Confidential Information Agreement
Schedule 2 - End User Agreement Forms
Schedule 3 - Secondline Support
Schedule 4 - Initial Sub-Distributors
Schedule 5 - Upstream Supplier Warranties
Schedule 6 - Dispute Resolution and Other Provisions
Schedule 7 - Seagate Products License Restrictions
Exhibit A - Distributor's Form of Purchase Order
Page 16 of 27
PRIMUS KNOWLEDGE SOLUTIONS, INC.
Software Marketing and Distribution Agreement
Schedule 1
Confidential Information Agreement
Page 17 of 27
PRIMUS KNOWLEDGE SOLUTIONS, INC.
Software Marketing and Distribution Agreement
Schedule 2
End User Agreement Forms
Page 18 of 27
PRIMUS KNOWLEDGE SOLUTIONS, INC.
Software Marketing and Distribution Agreement
Schedule 3
Secondline Support
Section 1. Definitions.
For the purposes of this Schedule, the following capitalized words and phrases
shall be ascribed the following meanings:
1.1 "Error" means the failure of any Software program to conform in any
material respect to its published Documentation.
1.2 "Fix" shall mean a modification or an addition to a Software program or its
Documentation that overcomes an Error when made or added to such program or
Documentation.
1.3 "Workaround" means a set of procedures that Distributor may follow to
circumvent or mitigate the impact of an Error, notwithstanding that the Error
still exists. Primus may provide a Workaround in lieu of a Fix in Primus' sole
discretion.
1.4 Other Defined Terms. Other capitalized words and phrases shall have the
meanings ascribed to them in Section 1 of the Software Marketing and
Distribution Agreement of which this Schedule is part.
Section 2. Primus' Provision of Secondline Support.
2.1 Technical Support. Primus shall provide telephone, fax and electronic
support to Distributor from its Seattle office regarding use of the Software and
resolution of Errors Monday through Friday from 6.30 a.m. to 5:30 p.m. local
time at such office. In addition, Primus shall make on-call technical support
staff available for High Priority situations (as defined in Section 2.2.1 below)
twenty-four (24) hours a day, seven (7) days a week. Primus shall provide such
support to one (1) support contact designated by Distributor who shall be
knowledgeable in all aspects of Distributor's and End Users' operating
environments.
2.2 Support Response. Primus will assign all Distributor requests for Error
support one of three response priorities. The priorities will dictate the timing
and nature of the response as follows:
2.2.1 High Priority. A major feature/function of the Software is not
working or the system integrity is at risk.
Response Goal: Primus shall use all commercially reasonable efforts to
provide a Fix or Workaround to Distributor within forty eight (48) hours of
Distributor's report of the problem. If Primus cannot provide the Fix or
Workaround within the forty-eight (48) hours Primus will dedicate resources to
the problem resolution and will inform Distributor on a daily basis of the
resolution status.
2.2.2 Medium Priority. An End User's work flow is inhibited or a non-major
feature/function of the Software is not working.
Response Goal: Primus shall use all commercially reasonable efforts to
provide a Fix or Workaround to Distributor within four (4) business days of the
Distributor's report of the problem. If Primus cannot resolve the problem within
the four (4) business days, Primus will inform Distributor on a weekly basis of
the resolution status.
2.2.3 Low Priority. An End User has a problem which is not seriously
impacting Distributor's workflow.
Response Goal: Primus shall use all commercially reasonable efforts to
provide a Fix or a Workaround to Distributor within seven (7) business days of
Distributor's report of the problem. If Primus cannot resolve the problem within
the seven (7) business days, Primus will provide Distributor with a status
evaluation regarding the ultimate resolution.
2.3 On-Site Visits. If Primus and Distributor mutually determine that Primus
may more effectively resolve a High Priority Error with an on-site visit to
Distributor's or the End User's relevant location, then Distributor shall be
responsible for Primus' reasonable travel and living expenses incurred in
conducting such visit. If Distributor requests Primus to attend on-site for any
other purpose, and Primus agrees, then Distributor shall pay Primus for Primus'
services on a time and materials basis, at Primus' then current daily rates for
the Territory, and shall reimburse Primus for Primus' reasonable travel and
living expenses.
2.4 Access to Primus' Knowledgebase. To the extent reasonably determined
necessary by Primus, Primus shall provide Distributor with access to Primus'
knowledgebase of solutions to Software Errors. Distributor shall comply with
Primus' reasonable security precautions related to such access, and shall treat
all knowledgebase information as Confidential Information of Primus; provided,
however, that Distributor may disclose Error solutions to End Users as part of
its End User Maintenance obligations, but only as confidential
Page 19 of 27
information under an effective non-disclosure agreement between Distributor and
the End User.
2.5 Distributor Cooperation. Distributor acknowledges that Primus may not be
able to resolve an Error if Distributor and any affected End User do not use all
commercially reasonable efforts to cooperate with and assist Primus in resolving
the Error (including, without limitation, in replicating the Error, in
retrieving workstation, server and log file data relating to the Error, and in
providing Primus with remote access to Distributor's or the End User's
installation for support purposes).
2.6 Scope of Secondline Support Services. Primus shall have no obligation to
correct Errors or support queries arising from any misuse or alteration of the
Software by any Person other than Primus, failure or fluctuation of electrical
power, maintenance of the Software by anyone other than Primus or Primus'
authorized representatives, or the combination or merging of the Software by any
Person other than Primus with any hardware or software not identified as
compatible by Primus. Primus shall have no obligation to correct Errors or
support Software programs except with respect to the then current and next last
current "Major Releases." "Major Releases" means a new release of a Software
program with a change in the YY component of that Software program's X.YY.ZZ
version number. It shall be a condition to Primus' provision of Secondline
Support that Distributor shall be current on its Support and Maintenance fee
payments for all of the Software.
Page 20 of 27
PRIMUS KNOWLEDGE SOLUTIONS, INC.
Software Marketing and Distribution Agreement
Schedule 4
Initial Sub-Distributors
Initial Sub-Distributors
Fujitsu Chubu Systems, Toshiba Information Systems, Hitachi Seisakusho, NTT
Software, NEC Software, Canon Hanbai, Kyowa Technologies, IBM Japan and NEC.
Page 21 of 27
PRIMUS KNOWLEDGE SOLUTIONS, INC.
Software Marketing And Distribution Agreement
Schedule 5
Upstream Supplier Software Warranties
A. Knowledge Broker Solution ("KBI") Support Suite Warranties
1. Media. The media on which the KBI Software is delivered by Primus will be
free from defects in materials and workmanship for a period of ninety (90) days
beginning on the date of shipment by Primus.
2. Performance; Year 2000. The KBI Software as delivered by Primus: (i) will
perform in all material respects in accordance with the applicable
specifications set forth in the applicable Documentation for a period of ninety
(90) days beginning on the date of shipment by Primus; and (ii) is "Year 2000
Compliant." Year 2000 Compliant means, for the purposes of this paragraph A.2,
that the KBI Software, when used with accurate date data and in accordance with
its associated documentation, is capable of properly processing date data from,
into and between the twentieth and twenty-first centuries, including the years
1999, 2000 and leap years, provided that all other products (e.g., hardware,
software and firm-xxxx) used with it properly exchange date data with the KBI
Software.
3. Infringement. To Primus' knowledge, use in accordance with this Agreement of
the KBI Software as delivered by Primus to Distributor does not infringe any
valid copyright, patent or trademark existing under the laws of the Territory.
--------------------------------------------------------------------------------
B. Seagate Crystal Info v.6 Warranties
1. Media. The media on which the Seagate Software is delivered by Primus will
be free from defects in materials and workmanship for a period of ninety (90)
days beginning on the date of shipment by Primus.
2. Performance; Year 2000. The Seagate Software as delivered by Primus: (i)
will perform substantially in accordance with the applicable specifications set
forth in the applicable Documentation in all material respects for a period of
ninety (90) days beginning on the date of shipment by Primus; and (ii) is "Year
2000 Compliant." Year 2000 Compliant means, for the purposes of this paragraph
B.2, that the Seagate Software will (i) under normal use and service, record,
store, process, and present calendar dates falling on or after January 1, 2000,
in the same manner, and with the same functionality, as such Seagate Software do
with dates falling on or before December 31, 1999; and (ii) lose no
functionality with respect to the introduction of records containing dates
falling on or after January 1, 2000. Notwithstanding the foregoing, if the date
related functionality of the Seagate Software relies upon the operating system
on which it is running or the software to which it interfaces, then the above
limited warranty applies only to the extent that such operating system and other
software properly exchanges date data with the Seagate Software.
3. Infringement. To the best of Primus' knowledge, use in accordance with this
Agreement of the Seagate Software as delivered by Primus does not infringe any
valid patent or copyright in the Territory, nor any trademark rights of a third
party based on the laws of the United States, Canada, Japan, New Zealand,
Australia, South Africa, or any country in Europe or South America.
Page 22 of 27
PRIMUS KNOWLEDGE SOLUTIONS, INC.
Software Marketing and Distribution Agreement
Schedule 6
Dispute Resolution And Other Provisions
Dispute Resolution
1.1 Governing Law. This Agreement shall be governed by and interpreted in
accordance with the internal laws of the State of Washington, and, where such
laws are preempted by the laws of the United States, by the internal laws of the
United States, in each case without regard to (a) conflicts of laws principles,
and (b) the applicability, if any, of the United Nations Convention on Contracts
for the International Sale of Goods. The governing language for this Agreement,
for the transactions contemplated hereby, for any notices, instruments or other
documents or media transmitted or delivered hereunder, and for the negotiation
and/or resolution of any dispute or other matter between the parties, shall be
the English language. In the event of any conflict between the provisions of any
document and an English version thereof, the provisions of the English version
shall prevail. Distributor hereby waives all and any rights it may have under
any law in any country or portion thereof to have the Agreement written in any
language other than English. In transactions between the parties, a decimal
point shall be indicated by a period, and not by a comma. Notice periods shall
be determined by reference to the local time of the notice recipient.
1.2 Mediation. In the event of any controversy or claim arising out of or
relating to this Agreement or the breach or interpretation thereof, the parties
shall, upon five days notice from either one to the other, submit themselves and
the subject-matter of the dispute to mediation before an independent mediator to
be appointed by the head office of the American Arbitration Association. Costs
of mediation shall be borne equally between the parties.
1.3 Arbitration. If the parties remain in dispute following the mediation, then
the controversy or claim shall be determined by arbitration in accordance with
the Commercial Arbitration Rules of the American Arbitration Association by a
single, disinterested arbitrator appointed in accordance with such Rules. The
determination of the arbitrator shall be final, conclusive and binding. Judgment
upon the award rendered may be entered in any court of any state or country
having jurisdiction.
1.4 Conduct. Each party shall ensure that any mediation and arbitration are
conducted as speedily as is reasonably possible, and that all and any
information disclosed during or in connection with the arbitration is treated by
each party with the strictest confidence.
1.5 Interim and Permanent Relief. Upon the application of either party to this
Agreement, and whether or not an arbitration or mediation has yet been
initiated, all courts having jurisdiction over one or more of the parties are
authorized to: (i) issue and enforce in any lawful manner such temporary
restraining orders, preliminary injunctions and other interim measures of relief
as may be necessary to prevent harm to a party's interests or as otherwise may
be appropriate pending the conclusion of arbitration proceedings pursuant to
this Agreement; and (ii) enter and enforce in any lawful manner such judgments
for permanent equitable relief as may be necessary to prevent harm to a party's
interests or as otherwise may be appropriate following the issuance of arbitral
awards pursuant to this Agreement.
1.6 Venue. Any mediation or arbitration conducted under or in connection with
this Agreement shall take place in Seattle, Washington, at a time to be
determined by the mediator or arbitrator, as the case may be.
1.7 Legal Expenses. If any proceeding is brought by either party to enforce or
interpret any term or provision of this Agreement, the substantially prevailing
party in such proceeding (as determined by the arbitrator in its sole
discretion) shall be entitled to recover, in addition to all other relief
arising out of this Agreement, such party's reasonable attorneys' and other
experts' (including without limitation accountants) fees and expenses (as
determined by the arbitrator in its sole discretion.
2. Excused Performance; Force Majeure. If the performance of this Agreement is
adversely restricted by reason of any circumstances beyond the reason-able
control and without the fault or negligence of the party affected, then the
party affected, upon giving prompt written notice to the other party, shall be
excused from such performance on a day-to-day basis to the extent of such
restriction (and the other party shall likewise be excused from performance of
its obligations on a day-to-day basis to the extent such party's obligations
relate to the performance so restricted); provided, however, that the party so
affected shall use all commercially reasonable efforts to avoid or remove such
causes of non-performance and both parties shall proceed whenever such causes
are removed or cease.
Page 23 of 27
3. Exclusion of Certain Claims. IN NO EVENT SHALL PRIMUS BE LIABLE (WHETHER IN
TORT OR CONTRACT, UNDER STATUTE OR OTHERWISE) FOR ANY INDIRECT, SPECIAL,
CONSEQUENTIAL OR INCIDENTAL DAMAGES, INCLUDING WITHOUT LIMITATION DAMAGES FOR
LOSS OF PROFITS, BUSINESS INTERRUPTION, LOSS OF INFORMATION AND THE LIKE,
ARISING OUT OF ITS PERFORMANCE OR NONPERFORMANCE OF THIS AGREEMENT OR THE USE,
INABILITY TO USE OR RESULTS OF USE OF THE SOFTWARE, EVEN IF PRIMUS HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
4. Limitation of Liability. Primus' liability arising out of this agreement
shall in no event exceed the fees paid by Distributor to Primus under this
Agreement.
5. Equitable Relief. Each of Distributor and Primus acknowledges that damages
will be an inadequate remedy if the other violates the terms of this Agreement,
or otherwise fails to perform its obligations hereunder. Accordingly, subject to
Section 1 of this Schedule, each of them shall have the right, in addition to
any other rights each of them may have, to obtain in any court of competent
jurisdiction, temporary, preliminary and permanent injunctive relief to restrain
any breach, threatened breach, or otherwise to specifically enforce any of the
obligations in this Agreement.
6. Waiver. No waiver of or with respect to any provision of this Agreement, nor
consent by a party to the breach of or departure from any provision of this
Agreement, shall in any event be binding on or effective against such party
unless it be in writing and signed by such party, and then such waiver shall be
effective only in the specific instance and for the purpose for which given.
7. Captions and Headings. The captions and headings are inserted in this
Agreement for convenience only, and shall not be deemed to limit or describe the
scope or intent of any provision of this Agreement.
8. Severability; Invalidity. If any provision of this Agreement is held to be
invalid, such invalidity shall not render invalid the remainder of this
Agreement or the remainder of which such invalid provision is a part. If any
provision of this Agreement is so broad as to be held unenforceable, such
provision shall be interpreted to be only so broad as is enforceable.
9. Assignment. Distributor shall not assign any of its rights this Agreement
without the prior written consent of Primus, which shall not be unreasonably
withheld. Subject to the foregoing restriction on assignment by Distributor,
this Agreement shall be binding upon, inure to the benefit of and be enforceable
by the parties and their respective successors and assigns. Primus may assign
all or any of its rights to enforce this Agreement to any licensor of Primus.
10. Notices. Any notice or other communication under this Agreement given by
either party to the other party shall be deemed to be properly given if given in
writing and delivered: (i) by facsimile transmission (receipt confirmed); or
(ii) by internationally recognized private courier, (e.g., Federal Express)
properly addressed and prepaid, to the recipient at the address identified on
the first page of this Agreement. Either party may from time to time change its
address by giving the other party notice of the change in accordance with this
Section.
11. Entire Agreement; Amendments. This Agreement constitutes and embodies the
entire agreement and understanding between the parties with respect to the
subject matter hereof and supersedes all prior or contemporaneous written,
electronic or oral communications, representations, agreements or understandings
between the parties with respect thereto. This Agreement may not be modified or
amended except by a written instrument executed by both parties. Only executive
officers of Primus shall have authority to amend this Agreement on behalf of
Primus. In the event of any conflict between the provisions of this Agreement
and the terms of any form of purchase order or invoice (including without
limitation any attached as a schedule or exhibit to this Agreement), the
provisions of this Agreement shall prevail. Distributor's standard terms of
purchase, if any, are inapplicable.
12. Counterparts. This Agreement and any amendments hereto may be executed in
one or more counterparts, which taken together shall constitute a single
agreement between the parties.
Page 24 of 27
PRIMUS KNOWLEDGE SOLUTIONS, INC.
Software Marketing and Distribution Agreement
Schedule 7
Seagate Licensing Restrictions
--------------------------------------------------------------------------------
SEAGATE'S MINIMUM TERMS OF END USER LICENSE
--------------------------------------------------------------------------------
To the extent that the Seagate products are not shipped by Primus subject to a
shrink-wrap or click-wrap license agreement, each End User License must contain
the following minimum (or substantially similar), terms and conditions
applicable to Seagate Products (sometimes for purposes of this Exhibit D, the
"Software"), modified as necessary for multi-copy packages:
APPLICABLE TO ALL SEAGATE PRODUCTS:
1. GRANT OF LICENSE. The End User is granted a personal, nonexclusive license
to use a single copy of the software program, including any updates,
additional modules, or additional software provided by Seagate in
connection therewith (the "Software") solely for End User's own use in
conjunction with the OEM Product or System, and solely in accordance with
the terms and conditions of this license agreement. End User may copy the
Software into the memory of any computer, solely as necessary to use the
Software in accordance with this license agreement.
2. OEM PRODUCT ACCESS. The license granted is qualified, in that the End
User's licensed copy of the Seagate Software may only be used with the
third party (OEM) product with which it was provided. Accessing data that
is not created by, or used by, the third party (OEM) product is in
violation of the End User's license.
3. THIRD PARTY BENEFICIARY. End User is notified that Seagate Software
Information Management Group, Inc., ("Seagate") is a third-party
beneficiary to the End User License to the extent it relates to use of the
Seagate Software. Such provisions are made expressly for the benefit of
Seagate and are enforceable by both OEM and Seagate.
4. COPYRIGHT AND COPIES. The Software (including any copy thereof), is owned
by Seagate or its suppliers and is protected by United States copyright and
patent laws and international treaty provisions. The Software copy is
licensed, not sold to you, and you are not an owner of any copy thereof.
You may either (a) make one copy of the Software solely for backup or
archival purposes, or (b) transfer the Software to a single hard disk
provided you keep the original solely for backup or archival purposes. You
may not otherwise copy the Software, except as necessary to use the OEM
Product or System or as authorized by applicable law, and you may not copy
the written materials accompanying the Software. Seagate hereby reserves
all rights not explicitly granted in this software license agreement.
5. OTHER RESTRICTIONS. You may not rent or lease the Software, but you may
transfer the Software and accompanying written materials on a permanent
basis provided you retain no copies and the recipient agrees to the terms
of this Agreement. If the Software is an update, any transfer must include
the update and all prior versions. You may not modify or translate the
Software. You may not reverse engineer, decompile or disassemble the
Software, except to the extent expressly authorized by applicable law. End
User may not remove, alter or destroy any form of copyright notice,
proprietary markings or confidential legends placed upon or contained
within the Software.
6. DUAL MEDIA. If the Software package contains more than one form of media,
such as a 3.5" diskette and a CD-ROM, then you may use only the media
appropriate for your computer or computer system. You may not use the other
media on another computer or loan, rent, lease, or transfer them to another
except as part of the permanent transfer (as provided above), of all
Software and written materials.
7. NO WARRANTY. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, THE
Software PROVIDED TO END USER HEREUNDER IS PROVIDED BY SEAGATE "AS IS"
WITHOUT ANY CONDITION OR WARRANTY WHATSOEVER. THE ENTIRE RISK ASSOCIATED
WITH THE INSTALLATION AND USE OF THE Software RESIDES WITH END USER. ALL
OTHER CONDITIONS OR WARRANTIES, EITHER EXPRESS OR IMPLIED, ARE DISCLAIMED
BY SEAGATE, INCLUDING, WITHOUT LIMITATION, THE IMPLIED CONDITIONS OR
WARRANTIES OF MERCHANTABILITY, OWNERSHIP AND FITNESS FOR A PARTICULAR
PURPOSE. SEAGATE SHALL NOT BE LIABLE FOR ANY INDIRECT, INCIDENTAL,
CONSEQUENTIAL, SPECIAL OR OTHER DAMAGES.
8. TERM. This license is effective until terminated. End User may terminate
it at any time by destroying the Software together with all copies,
modifications and merged portions in any form. It will also terminate
automatically upon yEnd user's failure to comply with any term or condition
of this Agreement. In the event of such termination, End User agrees to
promptly destroy the Software together with all copies, modifications and
merged portions in any form.
9. MISCELLANEOUS. The terms and conditions herein state the entire license
agreement with End user relative to any Seagate Software, and supersede any
prior agreement, whether written or oral, relating to the subject matter
hereof. The parties disclaim the application of the United Nations
Convention on the International Sale of Goods. This license agreement is
governed by the laws of the State of California, U.S.A., without reference
to conflict of laws principles. All disputes arising out of this license
agreement shall be litigated or otherwise resolved exclusively in the State
of California. End User may not export or re-export the Software or
documentation without the appropriate United States or foreign government
licenses. If any provision of this license agreement is ruled invalid, such
invalidity shall not affect the validity of the remaining portions of this
license agreement.
10. U.S. GOVERNMENT RESTRICTED RIGHTS. The Software and accompanying
documentation are deemed to be "commercial computer software" and
"commercial computer software documentation," respectively, pursuant to
DFAR Section 227.7202 and FAR Section 12.212, as applicable. Any use,
modification, reproduction release, performance, display or disclosure of
the software and accompanying documentation by the U.S. Government shall be
governed solely by the terms of this license agreement and shall be
prohibited except to the extent expressly permitted by the terms of this
license agreement.
Page 25 of 27
End User must affix the following legend to each copy of the Software:
Use, duplication, reproduction, or transfer of this commercial Software and
accompanying documentation is restricted in accordance with FAR 12.212 and DFARS
227.7202 and by a license agreement. Contact Legal Department, Seagate
Software, X.X. Xxx 00000, Xxxxxx Xxxxxx, Xxxxxxxxxx, 00000 X.X.X.
SPECIFIC SEAGATE PRODUCT USE RESTRICTIONS:
A. CRYSTAL INFO:
INSTALLATION AND USE. Seagate Crystal Info 6.0 is licensed to End User in
a combination of three potential Modules: (1) Client License (2) OLAP
Add-In License and (3) Report/Query Add-In License. Each licensed version
of the Software includes one Administrator ID, which shall correspond to a
single, designated individual (the "Administrator"). The Administrator may
install and use the components as set forth in the Client License, OLAP
Add-In License and Report/Query Add-In License; solely to facilitate
licensed use of the applicable Module(s). The End User must possess an
individual license and accompanying authorized Unique User ID ("UUID")
permitting access to and use of the Module(s) licensed. End User may
install and use (in the manner provided) only the Module(s) (including
their respective components), for which End User has obtained an express
license and accompanying authorized UUID(s). End User may have only as
many UUIDs defined or in use as have been authorized by Seagate, as set
forth in End User's particular license pack. Unless End User's purchase
agreement provides expressly to the contrary, no UUID may be shared by more
than one individual End User.
(1) Client License. Provided the total number of copies used or installed
at any one time does not exceed the number of licenses purchased or
UUIDs authorized(as set forth in End User's Client License pack) End
User may use the Client License (including the stated components) to
view, schedule and analyze existing reports as follows: (a) End User
may install Info Server, Info Administrator, Info Views, Info APS,
Sentinel, Info Analyzer, Info OLAP Server and Info Desktop (except
that End User may not schedule cubes) on one or more computers under
End User's control, and (b) End User may install the Info WebAccess
Server on one or more web servers to provide access by authorized End
Users via web browser; except that any End User who is not licensed to
use the OLAP Add-In License may not access or use the Info Worksheet
for Java component. Web browser access may be used in addition to
access via Info Desktop client software. Provided one copy of "client"
(but not "server") components of Crystal Info 6.0 is installed only on
the permanent memory of a single desktop computer, and that computer
is used by one authorized End User at least 80% of the time the
computer is in use, that same end user may make one copy of such
client components to use on a portable or home computer primarily used
by such authorized End User.
(2) OLAP Add-In License. End User may install and use the components as
set forth in the Client License. Subject to the same use conditions
placed on components of the Client License, End User may install and
use the Info Cube Designer to design OLAP cubes; Info Desktop to
schedule OLAP cubes; and Info Worksheet or Info Worksheet for Java (as
provided in the Info WebAccess Server and Info OLAP Server), to view
and manipulate OLAP cube information. End User may not design reports
unless End User is licensed to use the Report/Query Add-In License.
(3) Report/Query Add-In License. End User may install and use the
components as set forth in the Client License. Subject to the same use
conditions placed on components of the Client License, End User may
install and use Info Report Designer and Info Query Designer to design
reports and queries from relational or multidimensional databases. End
User may use the reports to populate Info Folders of other authorized
End Users.
Page 26 of 27
PRIMUS KNOWLEDGE SOLUTIONS, INC.
Software Marketing and Distribution Agreement
Exhibit A
Distributor's Form of Purchase Order
Page 27 of 27
