This software development agreement made this 7th day of August,
1998 between AMERICOM USA, INC., a company incorporated under the
laws of Delaware (the "Company") and SYSTEAM SPA, a Developer with
head office in Rome, xxx xxxxx Xxxx xx Xxxxxxxxx, 00 registered
under the laws of Italy, represented by Xxxxxx Xx Xxxxxx (the
"Developer").
Whereas:
1. The Company has developed certain technology (hereinafter
described as the "Technology") as described in Schedule A" hereof
and including without limiting the generality of the foregoing
(i) All source code and object code comprising any part of or in any
way used in any software applications or modules (collectively, the
"Software") forming the basis of or otherwise used in connection
with the Technology together with all tapes, disks, printouts and
other media on which the Software is stored. (ii) To the extent
reduced to written or other tangible form (including but not limited
to electronic media), all drawings, designs, plans, manuals,
research, specifications, formulae, processes, know-how, technology,
trade secrets and other confidential or proprietary information and
other data and information pertaining in any way to the Technology
or the Software or contemplated improvements, supplements, additions
to the Technology or the Software;
2. The Developer is engaged in information technology
consulting, software development, marketing, licensing and support
of certain software;
3. The Company has requested Developer to continue the
development of the Technology as described in Schedule "A" annexed
hereto;
4. Developer is prepared to undertake such development under
the terms and conditions specified in this Agreement for the
consideration specified in Schedule "B";
In consideration of the premises and mutual covenants herein set
forth and provided for, the parties hereto covenant and agree as
follows:
1. DEFINITIONS
The following words and terms shall have the following meanings
when used herein and such definitions shall apply to both the
singular and plural forms of any such words and terms:
(a) "Acceptance Date" means the date on which the
Software has passed all acceptance tests in accordance
with the provisions of clause 4(2) or has otherwise been
accepted by the Company under clause 4(3).
(b) "Agreement" means this agreement including all
schedules.
(c) "Business Day" means each of Monday, Tuesday,
Wednesday, Thursday and Friday except where any such day
occurs on any federal or provincial statutory holiday
observed in the Province of Ontario.
(d) "Charges" means the Royalty to be paid by Company to
Developer as set out in Schedule "B".
(e) "Commencement Date" means the date
within one year of the execution of this Agreement by the
parties whereinwhich the parties commence the preparation
of the Functional Specifications and on the occurrence
thereof each party shall within two (2) days thereof
confirm same has occurred to the other in writing.
(f) "Detailed Specifications" has the meaning given in
clause 2 and refers to Phase 2 and includes any amended
Detailed Specifications referred to in that clause.
(g) "Functional Specifications" means those capabilities
and functions to be met by the Software in Phase 2.
(h) "Implementation Schedule" means the schedule of
events leading to the implementation of the Software for
Phase 2.
(i) "Licensed Materials" means the Detailed
Specifications, the Software and the System Documentation.
(j) "Licensed Software" means those software programs
conforming to the Functional Specifications to be developed
by Developer and owned by the Company pursuant to the terms
and conditions of this Agreement.
(k) "Party" or "Parties" means either Developer or Company
if used in the singular and both Developer and Company if
used in the plural.
(l) Phase 1" means the preliminary work to be completed
pursuant to an oral agreement between the parties and which
oral agreement is amalgamated and merged with and forms
part of this Agreement.
(m) "Phase 2" means the work to be completed under the
terms of this Agreement.
(n) "Royalty Period" means that period set forth in
Schedule "B" whereinwhich the Developer is paid royalties
as therein set forth for their work.
(o) "System Documentation" means all documents,
flowcharts, printout specifications, file specifications,
test data, screen layouts, data dictionaries, report
layouts and all manuals which collectively contain a
complete description and definition of all operating
conditions of the Licensed Software, together with the
source code listings of the Licensed Software and all
operating and technical reference manuals describing the
operation and management of the Licensed Software.
2. It is agreed and understood that the Developer has completed
some of and will complete the balance of following matters relating
to Phase 1 of the project:
a) make the porting of existing database
(developed in Access) in a SQL Server 7.0 B3 Database;
b) rewrite or change several parts of the code
to increase the performance of the existing software.
c) develop the procedure inside the Database to
increase the performance and the security and consistency
of the data.
d) Redefine several functions/utilities to
increase the performance.
e) Redefine the logic of same systems to increase
the performance and rationalise the functions and data
access.
f) Define and configure the Server farm
3. DEVELOPMENT OF PHASE 2 DETAILED SPECIFICATIONS:
(1) On the Commencement Date, the Company together with the
Developer will commence preparation of the Functional
Specification for Phase 2.
(2) Upon delivery of Functional Specification, Developer
will commence preparation of detailed Licensed Software
design specifications, time lines and acceptance test
criteria (the "Detailed Specifications"). The Detailed
Specifications shall be prepared in accordance with and shall
be consistent with the Functional Specifications.
(3) The Detailed Specifications shall be delivered to the
Company for approval, within 20 Business Days of the
Commencement Date. Upon delivery of the Detailed
Specifications to the Company, the Company shall have 10
Business Days to approve the Detailed Specifications, to
reject that portion of the Detailed Specifications dealing
with acceptance test criteria, to reject the Detailed
Specifications as a whole (specifying in reasonable detail
the manner in which the Detailed Specifications are not in
accordance with the Functional Specifications or the
requirements of this Agreement), or to request specific
clarifications, additions or modifications to the Detailed
Specifications. Such approval, disapproval or request shall
be given in writing within the time period aforesaid, and if
not so given, the Company shall be deemed to have accepted
the Detailed Specifications.
(4) If the Detailed Specifications are rejected in whole or
in part by the Company, or if the Company requests specific
clarification, additions or modifications to the Detailed
Specifications, then Developer shall have a further period of
20 Business Days, or such longer period of time as the
Parties may in writing agree upon, in which to deliver to the
Company amended Detailed Specifications, for approval. Upon
delivery of such amended Detailed Specifications to the
Company, the Company shall have 5 Business Days to approve
the Detailed Specifications, to reject that portion of the
Detailed Specifications dealing with acceptance test criteria
or to reject the Detailed Specifications as a whole,
specifying in reasonable detail the manner in which the
Detailed Specifications are not in accordance with the
Functional Specifications or the requirements of this
Agreement. Such approval or disapproval shall be given in
writing within the time period aforesaid, and if not so
given, the Company shall be deemed to have accepted the
Detailed Specifications.
(5) If the Company accepts or is deemed to have accepted the
Detailed Specifications, or if the Company has rejected only
that portion of the amended Detailed Specifications which
deals with acceptance test criteria, then the Detailed
Specifications (other than such rejected part) shall be
deemed to be incorporated into and shall form a part of the
Functional Specifications. If there is a conflict between the
Detailed Specifications as incorporated and the Functional
Specifications prior to such incorporation, then the Detailed
Specifications shall govern.
(6) If the Company rejects that portion of the amended
Detailed Specifications dealing with acceptance test
criteria, then the Company shall be solely responsible at its
own expense for developing Licensed Software acceptance test
criteria for use as provided in clause 4.
(7) If the Company rejects the amended Detailed
Specifications as a whole, or if Developer fails to deliver
the Detailed Specifications to the Company within 30 Business
Days after the delivery of Functional Specification, or fails
to deliver the amended Detailed Specifications to the Company
as provided in clause 3(3), then the Company may terminate
its obligations under this Agreement, in accordance with the
provisions of clause 6.
3. DEVELOPMENT OF LICENSED SOFTWARE
(1) Following acceptance by the Company of the Detailed
Specifications, Developer shall proceed with the coding and
debugging of the Licensed Software and the development of the System
Documentation, all in accordance with the Implementation Schedule.
In connection therewith, Developer shall provide the services of
such personnel as may be necessary in order to efficiently complete
the foregoing.
(2) The Licensed Software shall at all times remain the
property of the Company it being recognised between the parties that
the Developer is simply expanding on the Technology developed by the
Company.
4. DEVELOPMENT OF TEST DATA AND ACCEPTANCE TESTING
(1) Following the Commencement Date and prior to the
developer starting the activities for the Detailed
specifications, Company, in cooperation with Developer,
shall prepare and provide a complete and comprehensive set
of test data (the "Test Data") for the purpose of testing
the Licensed Software.
(2) Following delivery of the Licensed Software, the
Licensed Software shall be subjected to a series of
acceptance tests, using the test data and/or the acceptance
test criteria accepted by the Company as part of the
Detailed Specifications, or prepared by the Company under
clause 4(1), as the case may be. The Licensed Software shall
be deemed to have passed such series of tests if and when,
the Licensed Software has succesfully passed the acceptance
tests.
(3) The acceptance tests referred to in clause 4(2) shall
be deemed to have been successfully completed if the Company
does not notify Developer in writing of any failure within
fifteen (15) Business Days of the date on which the failure
occurred. If the Company does so notify Developer, Developer
shall forthwith correct the Licensed Software and the
related System Documentation, at no charge to the Company,
and such acceptance test and the appropriate regression test
will be executed and the remaining tests will be continued,
until the test is successfully passed. Upon successful
completion of all acceptance tests, the Company shall so
notify Developer in writing within fifteen (15) days from
the end of tests.
(4) The acceptance date under clause 4(2) shall be deemed
to have occurred on the date upon which the specified
functions have been completed, and in the case of clause
4(3), upon the earlier of expiration of the fifteen (15)
Business Days and that date upon which Company provides
written notice of the acceptance of the Software to Developer.
5. IMPLEMENTATION SCHEDULE
(1) The development of the System Documentation, and the
coding, debugging and acceptance testing of the Licensed
Software shall be done in accordance with the timing set
forth in the Detailed Specifications.
(2) Developer and the Company shall report to each other
at meetings held at regular intervals as to the progress
being made by each of them in relation to the various events
set forth in the Implementation Schedule, and the delays
encountered and the action being taken to recover from such
delays. In connection therewith the Company and Developer
shall each designate one trained and competent person to act
as its liaison contact, with one alternate if desired. No
liaison person shall be changed without the prior written
notice to the other Party.
6. TERMINATION
(1) If either party shall default in the performance of any
of the terms and conditions of this agreement; or shall fail
to do any acts or things by it herein agreed to be done at
the time and in the manner herein provided, or shall do any
act or thing prohibited under the terms of this agreement,
or as hereinafter set forth, provided that in such case, if
such breach or default is curable, the party shall first
have the opportunity to cure any alleged default or breach
within thirty (30) days after receipt of written notice
thereof from the other and thereafter if such breach is not
cured the other party may on written notice terminate this
agreement;
(2) If Developer does not deliver the Detailed
Specifications to the company within the time periods set
out in clause 2(2);
(3) If the Company rejects as a whole the amended Detailed
Specifications. If the Company gives notice of termination,
the Developer shall deliver to the Company a complete set of
the Detailed Specifications, the System Documentation and
the Licensed Software (or such of the same as has then been
created), all working papers, computer files and output then
in its possession and which are applicable to the Licensed
Software, and shall return to the Company all files and
other materials belonging to the Company. The Company shall
thereafter be entitled to use all such material.
a) In the event of the occurance of such an event the
Company shall pay to the Developer an amount equal to
the reasonable billable time expended by the
Developer,at the Developer's commercial rates to the
date of termination.
(5) If the Licensed Software has
not passed all acceptance tests pursuant to
paragraph 4 hereof, within 20 Business Days or
such other time as defined in the test data
after the delivery of the Software by the
Developer, as a result of causes solely
attributable to Developer or to the
functionality of the Licensed Software, then
the Company may by written notice to Developer
either:
(a) accept the Licensed Software
at its then level of performance, or
(b) permit acceptance testing of
the Licensed Software to be
continued for such period as the
Company may designate in the notice.
During such period of time,
Developer shall, at no cost to the
Company, correct the Licensed
Software, following which the
Licensed Software shall again be
subjected to the applicable
acceptance tests or any portion
thereof not previously completed. If
acceptance testing cannot be
completed successfully within the
period set forth in the Company's
written notice, then the Company may
again choose to avail itself of (a)
and (b) of this clause, and so on
from time to time.
(6) The Developer shall have the right to
terminate this agreement subject to paragraph
6(1) hereof if:
(c) The Company does not pay or create
any royalties payable to the Developer
for any 3 consecutive quarters
commencing with the quarter beginning
April 1, 1999;
(d) The Company does not pay any
invoice for royalties owing to the
developer within 90 days of the end of
the quarter for which such royalties
are payable;
(e) If either party shall be
adjudicated a bankrupt or become
insolvent, goes into liquidation either
voluntarily or compulsorily, makes an
assignment or enters into any
composition or scheme or arrangement
for the benefit of its creditors,
discontinues its operations for any
reasons whatsoever, or if a receiver,
whether permanent or temporary, for all
or any part of the its respective
property, shall be appointed by any
Court of competent jurisdiction,
benefit of its creditors, or shall make
a proposal under any bankruptcy or
insolvency legislation, or commence any
proceedings to wind-up or liquidate or
dissolve;
(7) In addition to and without prejudice to the
rights and remedies to terminate this
agreement, the parties shall have the right to
seek judicial enforcement of their rights and
remedies including, and not by way of
limitation, injunctive relief, damages or
specific performance.
(8) No failure or delay on the part of either
party to exercise their respective rights of
termination or cancellation hereunder nor any
default by either party shall be construed to
prejudice the party's right of termination or
cancellation for any subsequent defaults.
7. PROPRIETARY AND TRADE SECRET INFORMATION
(1) Developer acknowledges and agrees to
protect the confidential nature of the
Licensed Materials and any other material
provided to Developer or obtained by
Developer as a result of this Agreement.
(2) Developer acknowledges that the
Licensed Materials are the exclusive
property of the Company and that they
contain proprietary and confidential
information and trade secrets of Company.
Developer agrees that its rights to use the
Licensed Materials are only as set out in
this Agreement. Developer shall not copy,
assign, lend, sell, lease or otherwise
dispose of or transfer to any third party
the Licensed Materials without the prior
written approval of Company except as
necessary for the execution of this agreement.
(3) Developer agrees to keep the
Licensed Materials in a secure manner and
location.
(4) In the event that Developer breaches
any of the foregoing provisions, Developer
agrees to indemnify and hold Company
harmless from all costs, losses or damages
suffered or incurred by Company as a result
of such breach. Developer further
acknowledges that in the event of a breach
of any of the provisions of this section,
damages will not be an adequate remedy, and
that the Company shall be entitled to
equitable relief including an injunction.
(5) The obligations of Developer and the
Company under this section shall survive
termination or expiration of this Agreement
for a period of three (3) years following
termination of this Agreement or any
renewal thereof.
8. TRAINING
Developer shall provide to the
Company, all necessary instruction in
respect of the use and support of the
Licensed Software. The Company may
designate any number of its personnel to
attend such training (not in excess of 5).
Those sessions at which training is to be
provided shall be scheduled at times
mutually agreed upon by Developer and the
Company and shall be conducted at the
Company's offices. The Company shall ensure
that all persons designated by it for
training are available at the times
scheduled for training sessions. Developer
shall ensure that any parts of the System
Documentation required for proper training
of the Company's personnel is delivered to
the Company at least 20 Business Days prior
to commencement of training.
9. SOFTWARE SUPPORT
(1) Developer agrees to provide
to the Company ongoing support of
the Licensed Software and the System
Documentation, for a period equal to
the Royalty Period from the
Acceptance Date.
(2) Support for the Licensed
Software includes:
(a) ongoing correction of
programming errors, so that
the Licensed Software will
at all times conform to the
System Documentation, and if
required, correction of the
System Documentation. To the
extent possible, correction
of programming errors will
be done via on-line
communication between
terminals at Developer's
offices and a terminal at
the Company's offices;
(b) problem
identification and
resolution services
available from qualified
personnel of Developer via
telephone;
(c) the development of
all revisions, enhancements
and upgrades to the Licensed
Software as may from time to
time be required to be made
to the Software by the
Company in accordance with
specifications agreed
between the Parties, and
(d) such other Software
maintenance and support
services as the parties
agree time to time.
10. WARRANTIES, EXCLUSIONS AND LIMITATIONS
(1) Warranties of Developer -- Developer warrants
to Company as follows:
(a) Compliance with Functional
Specifications -- The Licensed
Software will operate and perform in
accordance with the Functional
Specifications.
(b) Limited Product Warranty --
For a period of one year from the
Acceptance Date, the Licensed
Software will be substantially free
of programming errors, logic errors
and other defects in workmanship
attribuatble to work performed by
the Developer, provided that no
modifications are made to the
Licensed Software by persons other
than Developer, its employees or
persons approved by Developer. If
any such defect occurs within the
warranty period, Developer will
promptly correct such defect without
cost or expense to the Company.
11. CONFIDENTIALITY
(1) Definition:
(a) "Confidential Material of
Company" means:
(i) any
information of a
proprietary or
confidential nature,
including but not
limited to financial
and business
information relating
to Company which is
communicated to
Developer at any time;
(ii) any business
systems,
methodologies or
computer programs of
Company of which
Developer may acquire
knowledge in
connection with or
while performing its
obligations under
this Agreement, and
(iii) any other
information or data
received by Developer
from Company that is
identified as
proprietary or
confidential
including the
Technology.
(2) Confidentiality
Obligations -- Developer
acknowledges that the
Confidential Material of Company
(the "Confidential Material") is
confidential and constitutes a
valuable asset of Company. The
Company acknowledges that the
Confidential Material of the
Developer ie., the technology,
techniques and standard used in the
development of the Licensed Software
by the Developer herein is
confidential and constitutes a
valuable asset of the Developer and
as such the Company grants to the
Developer and includes within the
Confidential Material such
technology, techniques and standard
used in the development of the
Licensed Software by the Developer;
(3) Unless otherwise provided
under this Agreement, Developer and
Company shall as applicable:
(a) treat the
Confidential Material
as confidential;
(b) exercise at
care and discretion
with respect to the
Confidential;
(c) take all
necessary steps
including but not
limited to
instruction of
employees and agents
of Developer, to
ensure that the
confidentiality of
the Confidential
Material is maintained;
(d) not disclose,
publish, display or
otherwise make
available to other
persons any of the
Confidential Material
of the other, or
copies thereof except
as necessary for the
execution of this
agreement;
(e) except to the
extent authorized
hereunder in respect
of the Licensed
Software not
duplicate, copy or
reproduce any of the
Confidential Material
without the prior
written consent of
the Company except as
necessary for the
execution of this
agreement;
(3) This clause does not apply to:
(a) information that is in the
public domain or enters the public
domain through no breach of
confidence by Company or by Developer;
(b) information that is available
to one Party from some source other
than the other Party without a
breach of confidence with the other
Party;
(c) general computer technology,
ideas, concepts or tools;
(d) information that is or
becomes a part of the public domain
through no act or omission of the
other Party, or
(e) was in the other Party's
lawful possession prior to the
disclosure and had not been obtained
by the other Party either directly
or indirectly from the disclosing
Party; or
(f) is lawfully disclosed to the
other party by a third party without
restriction on disclosure;
(g) information which has been
provided in the first instance to
someone other than Company or
Developer or their respective
employees;
(h) information disclosed seven
years after the date of this
Agreement, and
(i) any disclosure as may be
required to be made by a court of
competent jurisdiction.
12. COPYRIGHTS, TRADE XXXX NOTICES, LEGENDS AND LOGOS
(1) Developer will defend the Company against a
claim that the Licensed Software used as authorised
under this Agreement infringes any patent,
copyright or other proprietary right but restricted
to those parts of the Licensed Software developed
by the Developer.. Developer will indemnify the
Company against all costs, damages and legal fees
finally awarded, on the condition that;
(a) the Company promptly
notified Developer in writing of
the claim, and
(b) Developer has sole control
of the defence and all related
settlement negotiations
(2)If the Licensed Software becomes, or in
Developer's opinion is likely to become, the
subject of a claim or infringement, Developer
shall, at its option and expense, either procure
for the Company the right to continue using the
Licensed Software or replace or modify the Licensed
Software so that it becomes non-infringing. If
neither of the foregoing alternatives is reasonably
available, the Company agrees, on one month's
written notice from Developer, to return the
original copy and all other copies of the Licensed
Software to Developer.
(3) Clauses 12(1) and (2) shall not apply to any
claim based upon:
(a) use of other than a current
unaltered release of the Licensed
Software if the infringement would
have been avoided by the use of a
current unaltered release of the
Licensed Software;
(b) the combination, operation or
use of any Licensed Software with
non-Developer software or data if
the infringement would have been
avoided by the combination,
operation or use of the Licensed
Software with other software or
data, or
(c) the use of the Licensed
Software in other than the operating
environment specified for it by
Developer if the infringement would
have been avoided by use in the
operating environment specified by
Developer.
(4) The same warranties and duties
regarding the full rights to use the Company's
Technology by the Developer are given by the
Company to the Developer.
13. RELEVANT LAW
This Agreement shall be construed and its
interpretation shall be governed exclusively, in all
respects, by the laws of the State of California, U.S.A.
14. GOOD FAITH
Each of the Parties acknowledge to one another that
each respectively intends to perform its obligations as
specified in this Agreement and to proceed in good faith
to the successful conclusion of the project.
15. PARTIES TO ACT REASONABLY
The Parties agree to act reasonably in exercising
any discretion, judgment, approval, or extension of time
which may be required to effect the purpose and intent of
this Agreement.
16. PREVIOUS AGREEMENT
This Agreement shall be deemed to supersede any
prior or collateral undertakings, warranties or
Agreements, whether oral or written, but shall amalgamate
and merge herein the oral agreement between the parties
relating to the completion of Phase 1 which all parties
herby acknowledge as completed.
17. NOTICES
Unless otherwise provided in this Agreement, any
notice under this Agreement shall be in writing and shall
be sufficiently given if delivered personally or mailed by
prepaid registered post to Company or Developer at their
respective addresses set forth below or at such other then
current address as is specified by notice. During a period
of actual or threatened postal disruption or dispute in
the country in which the notice is to be mailed or
received, any such notice may not be mailed, but must be
delivered personally. If notice is given by prepaid post
in accordance with this section, it shall be deemed to
have been received on the third Business Day following the
day of mailing. Notice may also be delivered by fax to the
addressee at the fax number noted below provided that it
shall be deemed to have been received on the next Business
Day following the date of transmission and further
provided that the original notice shall on or before the
next Business Day be delivered personally or mailed by
prepaid registered post to the addressee.
To Developer:
Attention: The President Xxxxxx Xx Xxxxxx
Rome, xxx xxxxx Xxxx xx Xxxxxxxxx, 00
Xxxxx 00128
To Company:
Xxxxxx Xxxxx
d/b/a TeleSpace
000 Xxxxx Xxxxxxx Xxxx
Xxxxxx Xxxxxx, Xxxxxxxxxx 00000
18. NON-ASSIGNMENT
This Agreement is personal to Company, and Company
may not assign, sublicense or transfer any of its rights
or obligations under this Agreement without the prior
written consent of Developer.
19. HEADINGS
The headings in this Agreement have been inserted
for convenience only, and are not to affect the
interpretation of this Agreement.
20. SEVERABILITY
If any provision of this Agreement is held invalid
under an applicable statute or rule of law, such
invalidity shall not affect other provisions of this
Agreement which can be given effect without the invalid
provisions, and to this end the provisions of this
Agreement are declared to be severable. Notwithstanding
the above, such invalid provision shall be construed, to
the extent possible, in accordance with the original
intent of the Parties.
21. DISPUTE RESOLUTION
Any controversy or claim arising out of or relating to
this contract shall be determined by arbitration in
accordance with the International Arbitration Rules of the
International Chambre of Commerce and to be held in Paris
France.
22. NON-WAIVER
Failure by either Party to enforce any term of this
Agreement shall not be deemed a waiver of enforcement of
that term or any other term.
23. SUCCESSORS AND ASSIGNS
This Agreement shall ensure to the benefit of and
be binding upon the Parties and their respective
successors and assigns.
24. CURRENCY OF CONTRACT
All payments and amounts referred to in this
Agreement shall be in United States currency.
25. CONFLICTS AND GOVERNING LAW
If any of the provisions of this Agreement are
invalid under any applicable statute or rule of law, they
are, to that extent, deemed omitted. This Agreement shall
be governed by the laws of the State of California, U.S.A.
and shall be read with all changes in gender and number as
may be required by the context.
In witness whereof the Parties have signed this
Agreement on the dates as noted below.
Signed, sealed and delivered
in the presence of:
AMERICOM USA, INC.,
Per:_______________
SYSTEAM SPA,
Per:_______________
