CONFIDENTIAL TREATMENT - REDACTED VERSION
OEM AGREEMENT
THIS AGREEMENT is made as of December 30, 1999 (the "Effective Date").
BETWEEN
CHANGEPOINT INC., with offices at 0000 Xxxxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx Xxxx, Xxxxxxx, X0X 0X0 ("Changepoint"),
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SOFTRAX CORPORATION, with its principal offices at 00 Xxxxxxx Xxxx,
Xxxxxx, Xxxxxxxxxxxxx, XXX, 00000 ("OEM").
IN CONSIDERATION of the premises and the mutual covenants contained
herein, the parties agree as follows:
ARTICLE 1 - INTERPRETATION
1.1 DEFINITIONS
Capitalized terms defined in this Agreement shall have the meaning
given to them herein and the following terms shall have the following meanings:
(A) "AFFILIATE" means with respect to any person, any other person
directly or indirectly controlling, controlled by, or under
common control of such person. "Control" as used here means
the legal, beneficial or equitable ownership, directly or
indirectly, of more than 50% of the aggregate of all voting
interests in such entity.
(B) "CHANGEPOINT SOFTWARE" means the computer programs in object
code form listed in Schedule A-1, such additional programs as
Changepoint and OEM hereinafter may agree to in writing by the
amendment of Schedule A-1, as well as Changepoint Upgrades and
Changes developed by Changepoint for which the Intellectual
Property Rights vest in Changepoint. The term Changepoint
Software shall also include software as Changepoint may
develop or have developed in order to allow interoperability
between the Changepoint Software and such third party software
applications as Changepoint may, from time to time, elect to
license with the Changepoint software.
(C) "CHANGEPOINT DOCUMENTATION" means the end user documentation
describing the operation and use of the Changepoint Software
in printed or machine readable form which is made generally
available from time to time by Changepoint to its customers.
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(D) "CHANGEPOINT INTELLECTUAL PROPERTY" means the Changepoint
Software, Changepoint Documentation, Changepoint Promotional
Materials, Changepoint Technical Documentation, Changepoint
Training Materials and the Changepoint Source Code.
(E) "CHANGEPOINT UPGRADE" means an Upgrade to the Changepoint
Software developed by Changepoint and made generally available
by Changepoint to its customers.
(F) "CONFIDENTIAL INFORMATION" means the confidential, secret or
proprietary information of one party (the "Disclosing Party")
including technical, financial, and business information and
software of the Disclosing Party which has been or hereafter
may be disclosed, directly or indirectly, to the other party
(the "Recipient") either orally, in writing or in any other
material form, or delivered to the Recipient and (i) with
respect to OEM includes the OEM Source Code, the OEM Software
forming part of an OEM Application Suite, the OEM
Documentation, the OEM Technical Documentation and the OEM
Software, and (ii) with respect to Changepoint includes the
Changepoint Software, the Changepoint Documentation, the
Changepoint Technical Documentation, Training Materials and
the Changepoint Source Code.
(G) "CUSTOMER MAINTENANCE AGREEMENT" means an agreement between
OEM and an End User to receive support or maintenance
including Changepoint Upgrades and Maintenance Releases and
corrections or workarounds for programming errors or defects
in the Changepoint Software.
(I) "END USER" means a Prospect that acquires one or more copies
of the OEM Application Suite from OEM pursuant to an End User
License for such organization's internal business purposes.
(J) "END USER LICENSE" has the meaning set out in Section 2.1.
(K) "GAAP" means, at any time, accounting principles generally
accepted in the United States as recommended in or by the
American Institute of Certified Public Accountants and the
Financial Accounting Standards Board at the relevant time,
applied on a consistent basis (except for necessary or
advisable changes in accordance with promulgations of the
American Institute of Certified Public Accountants and the
Financial Accounting Standards Board).
(L) "INTEGRATED", "TO INTEGRATE" OR "INTEGRATION" means the
combination of the Changepoint Software with the Integrative
Code or the combination of the Changepoint Software with the
Integrative Code and one or more applications of the OEM
Software in either case rebranded to create an OEM Application
Suite, in either event which will be (i) distributed on
compact disk(s) utilising a unified installation process or
(ii) installed on an End User computer by OEM.
(M) "INTEGRATIVE CODE" has the meaning ascribed to it in Section
4.1(c).
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(N) "INTELLECTUAL PROPERTY RIGHTS" includes all intellectual and
industrial property rights such as, copyrights, trade-marks,
patents, inventions, discoveries, industrial designs, design
rights, and rights in trade secrets and information of a
confidential nature.
(O) "LICENSE" means the license granted to OEM in Section 2.1.
(P) "LIST PRICE" has the meaning set out in Schedule E.
(Q) "MAINTENANCE RELEASE" means a change or modification to the
Changepoint Software designed to correct a programming error
or provide a temporary work-around for a programming error
which is made generally available at no additional cost to
customers of Changepoint that have paid to receive maintenance
service for the Changepoint Software.
(R) "MASTER COPY" means the diskette(s) or CD-ROM(s) containing
the Changepoint Software that is delivered by Changepoint to
OEM for use in Integrating the Changepoint Software with the
OEM Software.
(S) "OEM APPLICATION SUITE" means an OEM Software product offering
which includes either OEM Software Integrated with the
Changepoint Software in the manner described in Article 4 or
the Integrative Code Integrated with the Changepoint Software
which has been rebranded; provided, however, that until such
time that the initial Integrative Code has been completed by
OEM (but in any event no later than six (6) months following
the Effective Date of this Agreement), an OEM Application
Suite may mean the Changepoint Software as a standalone
product.
(T) "OEM DOCUMENTATION" means, the end user documentation
describing the operation and use of the OEM Software in
printed or machine readable form which is made generally
available from time to time by OEM to its customers.
(U) "OEM INTELLECTUAL PROPERTY" means the OEM Software, OEM
Documentation, OEM promotional materials, OEM Technical
Documentation, OEM Training Materials, the Integrative Code
and the OEM Source Code.
(V) "OEM SOFTWARE" means any one or more of the computer programs
in object code form listed in Schedule A2 as of the Effective
Date and such additional programs as Changepoint and OEM
hereinafter may agree to in writing by the amendment of
Schedule A-2 and includes Upgrades thereto made generally
available by OEM to its customers. The term "OEM Software"
shall also refer, where applicable by context, to the
Integrative Code and to such other software which OEM may
develop from time to time hereunder as part of its
operations/financials software products.
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(W) "PRICE LIST" means the price list for the Changepoint Software
set out in Schedule E as same may be changed by notice in
writing from Changepoint to OEM pursuant to the provisions of
Section 9.5.
(X) "PROMOTIONAL MATERIALS" means marketing and promotional
materials related to the Changepoint Software provided by
Changepoint to OEM to use in association with marketing an OEM
Application Suite and includes Upgrades thereto released by
Changepoint during the term of this Agreement which Upgrades
shall be promptly provided to OEM prior to or following their
release.
(Y) "PROSPECT" means (i) a Target Company with its head office in
the Territory, (ii) a person which has licensed the
Changepoint Software from Changepoint or an Affiliate of
Changepoint with its head office in the Territory, (iii) a
person which has licensed the OEM Software from OEM with its
head office in the Territory and such person's Affiliates(iv)
Affiliates of licensees of the OEM Application Suite with head
offices outside of Canada or the United States (v) OEM's
strategic partners that promote the OEM Software which have
their head offices in the Territory and (vi) a potential
licensee of Changepoint for the use of the Changepoint
Software which Changepoint has identified to OEM as a
potential licensee for an OEM Application Suite with head
offices in the Territory, and which in each case may be
interested in acquiring the OEM Software or an OEM Application
Suite. Notwithstanding the foregoing, if OEM identifies any of
the above that only have active offices in the Territory, OEM
may identify same to Changepoint and request that such entity
be deemed to be a Prospect for the purposes of this Agreement.
Within a reasonable period of time, Changepoint shall
determine in its sole discretion whether it is prepared to
allow such entity to be a Prospect and promptly communicate
its decision to OEM.
(Z) "SOURCE CODE" means in relation to Changepoint, the
Changepoint Source Code and in relation to OEM, the OEM Source
Code.
(AA) "TARGET COMPANY" means (i) a person whose main business
involves the development, marketing and distribution of
computer software and services related to such computer
software, and (ii) a person whose primary business involves
the development, marketing and distribution of internet-based
products or services related to such products who require
solution for tracking and managing customers, orders,
contracts, products and licenses, but does not include (a) an
information technology organization or group within a
non-information technology company, or (b) any person whose
primary business involves providing consulting or professional
services.
(BB) "TECHNICAL DOCUMENTATION" means technical documentation
related to either the Changepoint Software or the OEM Software
such as specifications, application programming interfaces,
data structures and flow charts and which is provided by one
party to the other hereunder and includes Upgrades thereto
made available by Changepoint to OEM during the term of this
Agreement.
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(CC) "TERRITORY" means the geographic territory of the United
States and Canada.
(DD) "TRAINING MATERIALS" means materials provided by Changepoint
to OEM for the purpose of training its staff in the
implementation and the provision of Level 1 and Level 2
support for the Changepoint Software and includes Upgrades
thereto made available by Changepoint to OEM during the term
of this Agreement.
(EE) "UPGRADES" means upgrades, enhancements, releases and new
Versions of software or documentation and with respect to the
Changepoint Software includes Maintenance Releases.
(FF) "VERSION" means a particular version of software which is
specifically identified by the numbers in the digits to the
immediate left and right of the decimal point in the product
version number, e.g., ((x).(x)x).
1.2 ACCOUNTING TERMS
All accounting terms not specifically defined herein shall be construed
in accordance with GAAP consistently applied.
1.3 SCHEDULES
The following Schedules shall constitute part of this Agreement for all
purposes:
Schedule A-1 - Changepoint Software
Schedule A-2 - OEM Software
Schedule B - Terms and Conditions for End User Licenses
Schedule C - Training Materials
Schedule D - Royalties
Schedule E - Changepoint Price List
Schedule F - Escrow Agreement
Schedule G - Changepoint License
Schedule H - OEM License
Schedule I - Program Quick Start
1.4 HEADINGS
The division of this Agreement into Articles and Sections and the
insertion of headings are for convenience of reference only and shall not affect
the construction or interpretation of this Agreement. The terms "this
Agreement", "hereof", "hereunder" and similar expressions refer to this
Agreement and not to any particular Article or Section or other portion hereof
and include any agreement supplemental hereto. References herein to Articles or
Sections are to Articles or Sections of this Agreement.
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1.5 CURRENCY
Except for the fees payable to the escrow agent in the Escrow
Agreement, all monetary amounts specified herein are expressed in U.S. dollars.
1.6 EXTENDED MEANINGS
In this Agreement words importing the singular number only shall
include the plural and VICE VERSA, and words importing persons shall include
individuals, partnerships, associations, trusts, unincorporated organizations
and corporations. The terms "provision" and "provisions" refer to terms,
conditions, provisions, covenants, obligations, undertakings, warranties and
representations in this Agreement. The term "includes" or "such as" shall be
construed as meaning "includes without limitation" and "such as without
limitation" as the case may be.
ARTICLE 2 - LICENSE
2.1 LICENSE GRANT
Subject to the provisions of this Agreement including the provisions of
Sections 13.5 and 14.1, Changepoint hereby grants OEM a non-exclusive,
non-transferable and non-assignable license in and for the Territory and during
the term of this Agreement to:
(a) Reproduce the Changepoint Software from the Master Copy for
Integration into an OEM Application Suite and as reasonably required to maintain
and support (but not modify) such product. OEM shall ensure that the Integration
of the OEM Software with the Changepoint Software shall not adversely affect the
full functionality of the Changepoint Software nor disable any substantive
features of the Changepoint Software included in the OEM Application Suite. OEM
shall ensure that the quality of reproduced Changepoint Software Integrated into
an OEM Application Suite is equivalent to the quality of the Changepoint
Software which Changepoint licenses to its customers, and meets or exceeds the
then current applicable standards for media and replication quality for disk or
CD-ROM media. In Integrating the Changepoint Software into an OEM Application
Suite, OEM shall rebrand the Changepoint Software to use the trademarks and
logos of OEM instead of the trademarks and logos of Changepoint provided,
however, that the OEM Application Suite states that it contains the Changepoint
Software by including the tag line "Powered by Changepoint" (or such similar tag
line as provided by Changepoint in consultation with OEM) on marketing
materials, product packaging, documentation and the opening screen of the OEM
Application Suite and provided further that the tag line is displayed so as to
be clearly noticeable without being prominent and such tag lines are approved by
Changepoint, such approval not to be unreasonably withheld.
(b) Reproduce, market, support (but not modify) and distribute in the
Territory to Prospects only, the Changepoint Software as such software is
Integrated into an OEM Application Suite directly to Prospects for their
internal business purposes and not for redistribution and who have agreed to
abide by the terms of the End User License, the minimum provisions of which are
set out in Schedule B (the "End User License"). In addition, OEM may also
appoint properly trained sales agents to market and distribute (but not
reproduce or support) in the Territory to Prospects only the Changepoint
Software as such software is Integrated into
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an OEM Application Suite directly to Prospects for their internal business
purposes and not for redistribution provided that such sales agent are not
authorized to sublicense the software. Notwithstanding the foregoing, OEM may
not distribute or grant any End User License to any person to use the
Changepoint Software portion of the OEM Application Suite who has, at the
date of the proposed transaction, already licensed the Changepoint Software
from Changepoint or an Affiliate of Changepoint or another person authorized
by Changepoint to grant such a license.
(c) Make technically accurate derivative works of the Changepoint
Documentation solely for the purpose of incorporating same into the OEM
Documentation prepared by OEM for an OEM Application Suite. OEM shall not
distribute the Changepoint Documentation as part of any book or other
publication for sale or license separate from an OEM Application Suite without
the prior written approval of Changepoint. OEM shall deliver to Changepoint a
copy of all OEM Documentation relating to an OEM Application Suite, for the sole
purpose of allowing Changepoint to verify the accuracy of such OEM
Documentation. If Changepoint identifies any material error in the OEM
Documentation, Changepoint shall provide reasonable notice of same to OEM
whereupon OEM shall make such changes as are reasonably requested by Changepoint
to render the OEM Documentation technically correct in all material respects.
OEM shall distribute the OEM Documentation in its then-current form in
association with and subject to the End User Licenses and for use only with an
OEM Application Suite. Notwithstanding the foregoing, OEM shall not create
derivative works of any compiled "*.HLP" files, if any, for use on the Internet.
(d) Distribute copies of Changepoint Promotional Materials received
from Changepoint and make derivative works of the Changepoint Promotional
Materials and subject to Section 5.2, distribute such derivative works as stand
alone materials or as integrated with OEM Promotional Materials to Prospects.
OEM shall not distribute any Promotional Materials referencing or describing the
OEM Application Suite without the prior written approval of Changepoint as to
the form and content of such material, which approval shall not be unreasonably
withheld or delayed; provided, however, that OEM shall not need such approval
with respect to derivative copies of Changepoint Promotional Materials where the
only changes to such materials made by OEM were in connection with the
rebranding of the product name. OEM may, at its option, purchase marketing and
promotional materials from Changepoint at cost.
(e) Use and reproduce Technical Documentation provided to OEM hereunder
solely for the purpose of Integrating the OEM Software with the Changepoint
Software, of developing Changes as provided under Article 6, and in providing
the technical support to end users described in Section 8.1. OEM may not
distribute technical documentation to any third person without the prior written
consent of Changepoint.
(f) Use and reproduce the Training Materials for the purposes of
training OEM's sales and support staff.
(g) Reproduce any Changepoint Source Code provided to OEM solely for
the purpose of rebranding the Changepoint Software for use as part of an OEM
Application Suite or for the purpose of making Changes as provided under Article
6.
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2.2 LICENSE RESTRICTIONS
OEM agrees not to supply or grant any sublicense to any person to use
all or any part of an OEM Application Suite unless such person has first become
subject to a binding and enforceable license agreement with OEM that contains
the minimum terms and conditions described in the End User License. OEM agrees
to use reasonable efforts to enforce the terms of the End User Licenses and to
inform Changepoint immediately of any known breach of such terms. OEM agrees, if
requested to do so by Changepoint and at Changepoint's sole cost and expense, to
provide an independent professional adviser to Changepoint with the right to
review copies of all End User Licenses for the purpose of determining whether
OEM is in compliance with the provisions of this Agreement. Where OEM is in
non-compliance with the provisions of this Agreement, the independent adviser
shall so inform Changepoint and OEM and shall provide Changepoint with a summary
of relevant information concerning OEM's non-compliance with the provisions of
this Agreement regarding End User Licenses. The independent adviser retained by
Changepoint shall not be authorized to disclose any OEM Confidential Information
to Changepoint without OEM's prior written consent.
2.3 LICENSE KEYS
OEM acknowledges that the Master Copy is license key protected. OEM
shall notify Changepoint at such time as an End User has executed the End User
License, and shall provide Changepoint with End User name and the number of
users to be licensed. Changepoint will use such information to generate a
license key within a period of forty-eight (48) hours during business days and
shall deliver such license key to OEM so that the Changepoint Software licensed
to the End User can be unlocked so as to be usable by such End User.
Notwithstanding the foregoing, in special circumstances, OEM may request the
generation of a license key within a shorter period and, in this case,
Changepoint agrees to use reasonable efforts to provide a license key within
such shorter period.
2.4 INTERNAL USE LICENSES
(a) OEM agrees to implement the Changepoint Software for its internal
business purposes (to the extent useful for its business) as soon as reasonably
possible. The use thereof shall be subject to the terms of Changepoint's
standard license agreement, a copy of which is attached hereto as Schedule G and
which shall finalized by the parties prior to its execution following the
Effective Date.
(b) Changepoint (or its Affiliate Changepoint Corporation) also agrees
to implement the OEM Software for its internal business purposes (to the extent
useful for its business) as soon as reasonably possible. The use thereof shall
be subject to the terms of OEM's standard license agreement, a copy of which is
attached hereto as Schedule H and which shall be finalized by the parties prior
to its execution following the Effective Date. Changepoint shall permit OEM to
list Changepoint as a user of the OEM Software on its client reference lists and
other marketing and promotional material. OEM shall permit Changepoint to list
OEM as a user of the Changepoint Software on its client reference lists and
other marketing and promotional material.
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(c) During the term of this Agreement each party will provide to the
other, standard maintenance and support services similar to those provided to
end users of each party's software products, with respect to the software
referred to in paragraphs (a) and (b) above, free of charge. Upon termination of
this Agreement, the licenses granted in paragraphs (a) and (b) above shall
terminate unless, at the time of termination of this Agreement, a party
subscribes for maintenance and support services from the other party at such
other party's then-current rates, and upon such other party's standard terms and
conditions.
(d) Each party shall provide to the other, on request, and at mutually
agreeable times, implementation assistance with respect to such party's software
on a time and materials basis at such party's then-current rates. If any
consulting services are requested by a party, the other party shall provide such
consulting services at mutually agreeable times, at a rate of $1000 per day.
2.5 RESERVATION OF OEM RIGHTS
Except for the express licenses conferred upon Changepoint hereunder,
there are no other licenses granted herein either express or implied and all
other rights with respect to the OEM Software and the OEM Intellectual Property
are expressly reserved by OEM.
2.6 RESERVATION OF CHANGEPOINT RIGHTS
Except for the express licenses conferred upon OEM hereunder, there are
no other licenses granted herein either express or implied and all other rights
with respect to the Changepoint Software and the Changepoint Intellectual
Property are expressly reserved by Changepoint.
2.7 THIRD PARTY SOFTWARE
OEM acknowledges that Changepoint shall not grant to OEM any license in
respect of any third party software that Changepoint may, from time to time,
elect to combine with the Changepoint Software. OEM shall make its own
arrangements to obtain all necessary licenses to use, reproduce and distribute
any such third party software. However, at OEM's request and expense,
Changepoint will assist OEM in dealing with any such third party.
ARTICLE 3 - RELATIONSHIP OF THE PARTIES
3.1 NON-EXCLUSIVE
OEM acknowledges that it has been granted non-exclusive rights to
sublicense and distribute the Changepoint Software as integrated into an OEM
Application Suite to End Users in the Territory. On an annual basis, the parties
will examine their relationship, and at such time OEM may request that all or
some of the rights granted hereunder be made exclusive, or that there be an
extension of the Territory, based on the expansion of OEM's sales and marketing
efforts to such extended regions. Changepoint will consider such request but may
grant or refuse such request(s) at its sole discretion. Further, nothing herein
shall prevent Changepoint from
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granting any right or license to any third party to use, distribute or
otherwise commercially exploit the Changepoint Software.
3.2 LEAD GENERATION AND COMPENSATION
If either party (the "Finder") identifies a sales lead which it elects
not to pursue and which it believes the other party (the "Receiver") could use
to its advantage, the following procedures shall govern:
(i) the Finder shall register the sales lead with the Receiver
through an e-mail notice (the "Registration"). If the parties
believe that an e-mail registration is inadequate for these
purposes, they shall agree upon another form of Registration
to take effect from the date of such agreement. The
Registration will provide information about the sales lead
such as the names and phone numbers of the key personnel
involved and a description of the needs that may be satisfied
by the Receiver;
(ii) if the Finder has proceeded sufficiently in the sale cycle to
make same commercially acceptable to the sales lead, the
Finder will introduce the Receiver to the sales lead;
(iii) the Receiver will have five (5) days from receipt of the
Registration to accept or reject the Registration. It will be
solely at the discretion of the Receiver as to whether this is
accepted or rejected. If a rejection is made, it will be
accompanied by a short explanation, (i.e. the Receiver was
already working the sales lead);
(iv) if the sales lead has NOT signed an agreement with the
Receiver within 180 days of the date of the Registration, the
Registration will expire. If the sales lead has signed an
agreement with the Receiver for a license of the OEM Software
or the Changepoint Software, as the case may be, within 180
days of the date of the Registration, the Receiver will pay a
finders fee to the Finder equal to five percent (5%) on all
GAAP-recognizable license fees for the OEM Software or the
Changepoint Software, as the case may be, invoiced to the
sales lead within the first 180 days of the signing of such
agreement. The Receiver will pay the Finder this amount within
45 days of the end of each calendar quarter;
(v) there will be no charge backs because payments are made on
recognizable license revenue only (which by definition is
irrevocable);
(vi) in order for a sales lead to qualify under this Section 3.2,
there must have been at least one qualifying discussion
(either by telephone or in person) by a sales representative
of the Finder; and
(vii) the parties agree to pay a minimum of 50% of any finders fee
to the sales representative that resulted in the Registration
in order to incent their respective sales forces to develop
and send sales leads to the other party under the provisions
of this Section.
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CONFIDENTIAL TREATMENT
3.3 OEM TRAINING AND IMPLEMENTATION SUPPORT
In consideration of the payment of a one-time Program Quick Start
fee of ***, which fee shall be paid by cash or cheque on the Effective Date,
Changepoint agrees to provide to OEM a copy of the Training Materials,
Changepoint Promotional Materials, Changepoint Technical Documentation, and
the Changepoint Documentation as well as the services described in Schedule
G. OEM acknowledges that any support over and above the amounts specified in
Schedule G and implementation assistance required by OEM (whether for an End
User or otherwise) shall be charged at Changepoint's then-current time and
materials rates, less a *** discount. Changepoint shall use reasonable
efforts to make available suitable Changepoint personnel to assist OEM in
providing implementation assistance to End Users. Changepoint shall make any
subsequent Training Materials available to OEM promptly following their
development.
ARTICLE 4 - PRODUCT INTEGRATION
4.1 INTEGRATION OF CHANGEPOINT SOFTWARE
(a) Each party shall appoint an experienced staff member (the
"Integration Manager") on behalf of such party to oversee Integration of the
Changepoint Software with the OEM Software to create the OEM Application
Suite.
(b) Within thirty (30) days of the Effective Date, the Integration
Managers shall meet and develop an Integration plan which will, at a minimum,
clearly set out the file/database level of integration functionality as well as
the minimum level of Integration of the OEM Software with the Changepoint
Software which will qualify the integrated offering as an OEM Application Suite,
such minimum level not to exceed the development of Integrative Code allowing
the transfer of data between the OEM Software and the Changepoint Software.
(c) OEM shall have the responsibility for developing the code and other
materials to Integrate the Changepoint Software with the OEM Software (the
"Integrative Code"). Changepoint will provide technical information including
Application Programming Interfaces (APIs) and reasonable assistance as required
by OEM to develop the Integrative Code; however, Changepoint shall not be
required to deliver any Changepoint Source Code to the Changepoint Software to
OEM except to the extent required by OEM to effect the rebranding of the
Changepoint Software as contemplated by the parties under Section 2.1(a). If
Changepoint elects not to provide any Changepoint Source Code to OEM in these
circumstances, Changepoint will provide such services to OEM at no charge as OEM
would have performed using the Changepoint Source Code to effect such
rebranding.
(d) OEM shall develop the Integrative Code as soon as commercially
practicable but, in any case, within six (6) months of the Effective Date.
Following completion, OEM shall provide to Changepoint a complete copy of an OEM
Application Suite for review.
(e) Changepoint shall be entitled to inspect the Integrative Code and
the quality of the Integration of the Changepoint Software with the OEM
Software, including any changes made to the user interface of the Changepoint
Software, and to approve same prior to OEM's marketing
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
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or distribution of same absent any material deficiency in the same.
Changepoint agrees not to unreasonably withhold or delay its approval.
4.2 INTEGRATION OF UPGRADES
(a) OEM shall be responsible for developing and implementing any
changes to the Integrative Code required as a result of any Changepoint
Upgrades. Each Upgrade shall be Integrated by OEM into the OEM Application Suite
after its release by Changepoint within a timely fashion taking into account the
complexity of the Upgrade. Changepoint agrees to give OEM notice as far in
advance as reasonably possible and provide technical information and assistance
to OEM as may be reasonably necessary for OEM to analyse the impact of the
Upgrade on the Integrative Code. The provisions of Section 4.1 shall apply to
any Upgrades to the OEM Application Suite.
(b) OEM may distribute Changepoint Upgrades to End User licensees of
the OEM Application Suite subject to the following limitations in addition to
those specified above:
(i) OEM shall not directly or indirectly distribute any
Changepoint Upgrade to any End User to which OEM did not
directly or indirectly distribute the copy of the OEM
Application Suite into which the Changepoint Upgrade is to be
Integrated; and
(ii) OEM shall, as to every Changepoint Upgrade that OEM
distributes, either: (1) distribute to the End User an Upgrade
of the OEM Application Suite that Integrates the Changepoint
Upgrade or; (2) use commercially reasonable efforts to promote
the Integration of the Changepoint Upgrade into the End User's
copy of the OEM Application Suite promptly upon delivery to
the End User and to ensure that the Upgrade is used for no
purpose other than to upgrade the OEM Application Suite.
Without limiting the generality of the foregoing, such
commercially reasonable efforts shall include requiring End
Users by written contract to use the Changepoint Upgrade only
as an Upgrade to OEM Application Suite.
ARTICLE 5 - MARKETING
5.1 MARKETING OBLIGATIONS OF OEM
During the term of this Agreement, OEM shall:
(a) identify Changepoint as a strategic partner in all marketing
and promotional materials and activities relating to an OEM
Application Suite;
(b) devote sufficient financial resources and technically
qualified sales and service personnel to fulfil its
responsibilities under this Agreement;
(c) use commercially reasonable efforts to meet the Sales Targets
referred to in Section 5.4 (except following the provision of
notice by either party of its intent
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to terminate and/or not to renew this Agreement) and to
carry out the activities and meet the objectives set out in
the marketing plans referred to in Section 5.3;
(d) establish and maintain a team to market and provide support
for every OEM Application Suite. In order to meet this
commitment, OEM agrees that it shall make at least five (5)
members of OEM's sales staff available for use and sales
training and at least five (5) members of OEM's technical
staff available for use and support training to be made
available by Changepoint; and
(e) (except following the provision of notice by either party of
its intent to terminate and/or not to renew this Agreement)
actively promote an OEM Application Suite to Prospects in the
Territory by, among other means, attending trade shows,
advertising on OEM's web site, and featuring the OEM
Application Suite in OEM's product catalogue.
5.2 MARKETING OBLIGATIONS OF CHANGEPOINT
During the term of this Agreement, Changepoint shall:
(a) identify OEM as a strategic partner in its marketing and
promotional materials which describe Changepoint's strategic
partners and which Changepoint makes generally available to
its customers and on the applicable portion of its Web Site;
(b) devote technically qualified personnel to fulfil its
responsibilities under this Agreement;
(c) with the assistance of OEM, provide its sales force with
training in the marketing of the OEM Software; and
(d) at a corporate level, promote OEM as a strategic partner and
the OEM Software as a "product of choice" for operations
including financials within OEM's target market (but not
necessarily in other markets).
5.3 QUARTERLY MARKETING MEETINGS
The parties agree to meet quarterly to: (a) review sales and marketing
efforts by each party with respect to the objectives set forth in this Agreement
during the preceding quarter; (b) discuss and resolve any channel conflict or
other marketing and sales issues which may have arisen during the preceding
quarter; (c) discuss and plan joint marketing opportunities for the forthcoming
quarter; (d) discuss, when desired by the parties, respective sales plans for
the next quarter and put into place such mechanisms as may be most effective in
preventing channel conflict; (e) discuss and implement agreed-upon shared
commission procedures; and (f) discuss such other matters as are pertinent to
the objective that this Agreement continue to the mutual profit of each party.
The quarterly meetings shall be led by an employee of at least the level of Vice
President from each party. Meetings may be held telephonically. The first such
meeting shall occur within thirty (30) days following the Effective Date.
-14-
CONFIDENTIAL TREATMENT
5.4 SALES TARGETS
(a) OEM's sales performance target ("Sales Target") for the period
from the Effective Date through December 31, 2000 (the "First Year") shall be
revenue of at least *** in license fees from the licensing and distribution
of the Changepoint Software portion of an OEM Application Suites to End Users
in the Territory calculated in accordance with GAAP revenue recognition rules.
(b) Sales Targets for subsequent years after the First Year shall be
negotiated in good faith between the parties by October 1st of the
then-current year. The minimum Sales Target for the year after the First Year
will be revenue of at least $ *** in license fees, and the minimum Sales Target
for any subsequent year will be the minimum Sales Target for the previous
year plus at least an additional $ *** in license fees in each case, from the
distribution of the Changepoint Software portion of the OEM Application
Suites to End Users in the Territory calculated in accordance with GAAP
revenue recognition rules.
ARTICLE 6 -- CHANGE REQUESTS
6.1 CHANGE REQUEST PROCESS
(a) OEM may request changes, updates or enhancements (collectively,
"Changes") to the Changepoint Software by delivering such request to Changepoint
in writing, specifying the request in sufficient detail, including relevant time
requirements, to enable Changepoint to analyse the technical feasibility of such
request.
(b) Within a reasonable period of time (and in any event, no more than
ten (10) business days) after receiving such request, Changepoint shall
communicate to OEM whether the request has been accepted, rejected or if further
information is required. If further information is required, the procedure in
this section 6.1 shall be repeated. If the request is accepted, Changepoint
shall indicate by a notice in writing to OEM the anticipated date for
implementation of such Change, having regard to Changepoint's existing
development plans and availability of personnel. Changepoint will use reasonable
efforts to estimate the anticipated date for the implementation of such Change,
but Changepoint shall have no liability to OEM for any delays in implementing
the Change. In the event Changepoint changes its development plans such that the
requested Change will not be made, Changepoint shall so notify OEM and in that
event the request shall be considered to be one which Changepoint rejected and
the provisions of Section 6.1(c) shall apply.
(c) If Changepoint rejects a Change request in writing, or if
Changepoint declines to provide OEM with a commitment to develop a Change in a
timely fashion pursuant to Section 6.1(b), OEM can request Changepoint to quote
a price for the development of such Change. Changepoint will quote a price and a
proposed implementation date and related terms for such request. If OEM agrees
to the price and other terms upon which Changepoint offers to develop the
Change, Changepoint and OEM will enter into a written supplement to this
Agreement setting out the terms and conditions upon which the Change will be
made. Alternatively, if Changepoint notifies OEM in writing that it is not
prepared to develop the Change (other than because the Change is not technically
feasible), and if the change is one which, if not made,
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
-15-
would materially and adversely affect OEM's ability to meet the
then-applicable Sale Targets, then Changepoint will not unreasonably refuse
to provide OEM with access to such portions of the Changepoint Source Code as
is required to implement such Change for the sole purpose of enabling OEM to
make such Change itself under terms and conditions to be agreed upon in
writing by the parties. Such terms and conditions will include:
(i) the nature of the technical information and the portions of
the source code to be provided to OEM to effect the Change;
(ii) the effect of the Change on warranty and other obligations of
Changepoint herein;
(iii) agreement on how the Change will be supported and maintained;
(iv) the quality assurance to be performed by Changepoint;
(v) the technical assistance to be provided by Changepoint with
respect to such Change; and
(vi) the fees and expenses to be paid to Changepoint related to the
Change.
And unless, otherwise agreed to by the parties, any Change so developed by OEM
shall be subject to the following terms:
(i) subject to the pre-existing Intellectual Property rights held
by Changepoint in the Changepoint Software and the Changepoint
Source Code, title to any Change developed by OEM shall vest
immediately and exclusively in OEM;
(ii) OEM shall have sole responsibility for the support and
maintenance of the Change and Changepoint shall not be
required to support or provide warranty protection for the
same;
(iii) technical assistance provided by Changepoint to OEM in
connection with OEM's development of the Change may be charged
by Changepoint at its applicable rates for such services; and
(iv) OEM shall not indicate that the Change is a product of
Changepoint.
6.2 PRICING OF CHANGES
Unless otherwise agreed to by the parties, if Changepoint develops a
Change for OEM pursuant to Section 6.1(c), Changepoint shall price such Change
at a discount of 50% off of Changepoint's then current usual rates for the
development of enhancements to the Changepoint Software.
-16-
ARTICLE 7 - SOURCE CODE
7.1 ESCROW
(a) Changepoint shall, at OEM's request, deposit a copy of the source
code for the Changepoint Software in escrow with Montreal Trust Company of
Canada pursuant to an escrow agreement substantially in the form of Schedule F
(the "Escrow Agreement") or as may be amended by the parties as soon as
reasonably possible following the Effective Date. All costs and expenses
associated therewith shall be borne by OEM.
(b) Changepoint acknowledges that Prospects of OEM may request OEM to
place in escrow Changepoint Source Code together with the OEM Source Code. In
the event of any such request, Changepoint agrees to provide a letter signed by
an officer of Changepoint addressed to the Prospect offering to enter into a
maintenance agreement for the Changepoint Software in the event of a bankruptcy
of OEM or in the event OEM ceases to carry on business, on Changepoint's
standard terms, provided that any such request is made while Changepoint is
still offering to license the Changepoint Software to Prospects in the
Territory. Changepoint's obligation shall be restricted to offering to maintain
and support the current and immediately previous Version of the Changepoint
Software then being marketed by Changepoint.
(c) The Changepoint Source Code shall only be released to OEM on the
terms and subject to the conditions set out in the Escrow Agreement. The parties
agree that any breach of the terms of the Escrow Agreement by a party hereto
shall be deemed to be a material breach of this Agreement. Except as elsewhere
set forth in the Agreement, nothing in this Article 7 shall require Changepoint
to deliver to OEM all or any part of the Changepoint Source Code, except as
required by the Escrow Agreement.
ARTICLE 8 - MAINTENANCE AND SUPPORT
8.1 TECHNICAL SUPPORT
(a) OEM will provide Level 1 Support and Level 2 Support directly to
End Users who have entered into Customer Maintenance Agreements. Level 1 Support
means the service provided in response to the initial phone call placed by an
End User which identifies and documents an error in the OEM Application Suite.
This includes problem source identification assistance, problem analysis,
problem resolution, installation planning, information and preventative and
corrective service information. Level 2 Support means the service provided to
analyse or reproduce the error or to determine that the error is not
reproducible. This includes problem re-creation and in-depth technical analyses.
During the first six (6) months following the Effective Date, Changepoint will,
if required by OEM, provide Level 2 support and back-up Level 1 support (but not
including taking the support call or making the initial identification and
documentation of the reported error) to OEM. OEM shall use all reasonable
efforts to have its support staff trained as soon as possible so that such
persons are able to provide Xxxxx 0 and full Level 1 support as soon as
reasonably possible.
(b) Changepoint shall provide Level 3 Support to OEM for problems that
have been escalated beyond Xxxxx 0 Xxxxxxx. Xxxxx 0 Support means making changes
to the Changepoint
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CONFIDENTIAL TREATMENT
Software to resolve the problem. Requests for Level 3 Support shall be made
by no more than six (6) persons designated by OEM to receive such support and
who have been fully trained in the use and support of the Changepoint
Software. Changepoint shall also, during the term of this Agreement and for
the period during which OEM is authorized to continue to provide support to
End Users following termination of the Agreement, make electronically
available to OEM on a continuous and ongoing basis through its Web Site
Changepoint's then-current generally available database of support-related
information, including, without limitation, bugs identified in the
Changepoint Software together with fixes, workarounds or other responses
developed by Changepoint to support its own customers.
(c) OEM shall inform all End Users that OEM is the sole support contact
for the OEM Application Suite and that Changepoint is not responsible for
supporting End Users in their use of the Changepoint Software. OEM will also
include within the OEM Application Suite or the OEM Documentation, as
appropriate, a conspicuous description of the Level 1 Support and Level 2
Support it provides and the method and means that End Users shall use to contact
OEM to receive such services.
(d) OEM agrees to provide End Users with support for the current and
immediately previous Version of the Changepoint Software Integrated into an OEM
Application Suite.
ARTICLE 9 - PRICES AND PAYMENT
9.1 END USER LICENSE FEES
(a) OEM shall be entitled to charge license fees to End Users in
respect of an OEM Application Suite as OEM, in its sole discretion, sees fit.
(b) OEM shall remit royalties to Changepoint in respect of the
licensing to the OEM Application Suite, calculated in the manner set out in
Schedule D (the "License Fee Royalties").
(c) For End User Licenses granted by OEM to End Users in the Territory
during the period through June 30, 2000, OEM may remit the License Fee
Royalties, less ***.
9.2 MAINTENANCE FEES
For each Customer Maintenance Agreement entered into by OEM, OEM shall
pay to Changepoint a royalty calculated in the manner set out in Schedule D (the
"Maintenance Fee Royalty").
9.3 PAYMENT OF FEES
All License Fee Royalties and Maintenance Fee Royalties in respect of a
calendar quarter shall be due and payable within forty-five (45) days of the end
of such quarter. Any other fees or charges hereunder shall be due within thirty
(30) days of receipt of invoice by the party owing such fees or charges.
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
-18-
9.4 RECORDS AND REPORTS
(a) Within fifteen (15) days following the end of each calendar month
during the term of this Agreement, OEM will submit to Changepoint a report in a
form reasonably acceptable to Changepoint setting forth separately the number of
OEM Application Suites licensed to End Users during the preceding month and the
End Users with whom OEM has Customer Maintenance Agreements. The report shall
also contain a calculation of the royalties and other payments due to
Changepoint in respect of the month.
(b) OEM agrees to keep full and accurate books of accounts and records
regarding the manufacture, sublicensing and commercial distribution of the OEM
Application Suite in sufficient detail to enable the payments to be made and the
other obligations of OEM hereunder to be verified by Changepoint. Changepoint
may, at its expense, designate an independent accountant, certified public
accountant or auditor to audit such books and records. If any such audit results
in a finding that additional, unreported payments are due to Changepoint that
exceed the amount paid to Changepoint during the same payment period(s) by over
seven and a half percent (7 1/2%), then OEM will additionally be obligated to
pay for the expense of the audit. If the audit determines that additional,
unreported payments are due, such amounts shall be immediately payable.
9.5 PRICE LIST
Changepoint may amend or change its then current Price List by notice
in writing to OEM. The amendments and changes shall become effective sixty (60)
days following the delivery of the notice to OEM. However, the Price List shall
remain effective for a period of up to one hundred and twenty (120) days with
respect to proposals submitted to Prospects by OEM prior to receipt of the new
Price List. In the event that Changepoint's List Price increases by one hundred
percent (100%) or decreases by forty percent (40%) during any calendar year, the
parties shall meet to discuss the effect of such increase or decrease and
determine in good faith whether the annual Sales Target and/or the royalty
payment scale should be adjusted to reflect such increase or decrease.
9.6 TAXES
All amounts payable under this Agreement are exclusive of and OEM
agrees that it shall pay any sales, use, rental, personal property, value added,
consumption or other tax that may be assessed in any jurisdiction based upon,
arising out of or related to this Agreement, except for tax based on the net
income of Changepoint.
ARTICLE 10 - TRADE-MARKS, TRADE PRACTICES
AND INTELLECTUAL PROPERTY
10.1 USE OF TRADE-MARKS
OEM shall make no use of trade-marks, trade names or other trade
designations, whether registered or unregistered (a "Trade-Xxxx"), of
Changepoint without the prior written consent of Changepoint; provided, however,
that the consent of Changepoint is hereby granted for OEM's
-19-
use of a Trade-Xxxx (a) to effect the branding and proprietary notices
required by Changepoint under this Agreement, and (b) during the first six
(6) months following the Effective Date, to the extent that such use is
limited to OEM's use of Changepoint Promotional Materials, Changepoint
Documentation and Changepoint Software in connection with its licensed
reproduction, marketing, distribution and support of the Changepoint Software
prior to the completion of relevant Integration efforts. OEM acknowledges
that Changepoint has and will have substantial goodwill in the trade-marks
used in conjunction with the Changepoint Software and OEM agrees that it will
not do anything that could injure, diminish or depreciate the value of the
goodwill associated with the trade-marks or the business of Changepoint. All
goodwill associated with the use of any Changepoint Trade-Xxxx shall enure
exclusively to Changepoint.
10.2 PROPRIETARY LEGENDS
On all copies of the OEM Application Suite and applicable media
therefor, made by OEM, OEM shall display proprietary, copyright, trademark and
other proprietary legends of Changepoint in the form and locations reasonably
requested by Changepoint. OEM may also display its own proprietary, copyright,
trademark and other proprietary legends in conjunction with the OEM Application
Suite. OEM shall not, however, indicate that the copyright or any other
Intellectual Property Right in the Changepoint Software is owned by or
proprietary to OEM.
10.3 CONDUCT OF BUSINESS
OEM will conduct its business of marketing the OEM Application Suite in
a manner that will reflect favourably on the good name and reputation of
Changepoint and the Changepoint Software. In particular, OEM agrees to comply
with all applicable national, international and local laws, ordinances, and
regulations in its dealings with Changepoint and in performing its obligations
under this Agreement and OEM will refrain from engaging in any unfair, or
deceptive trade practice, or unethical business practice whatever, or practice
that could unfavourably reflect upon Changepoint or the Changepoint Software and
Documentation.
10.4 OWNERSHIP OF CHANGEPOINT INTELLECTUAL PROPERTY
(a) OEM acknowledges that Changepoint and/or licensors of Changepoint
are the owners of all Intellectual Property Rights in the Changepoint
Intellectual Property.
(b) Changepoint shall own all Intellectual Property Rights in and to
all Upgrades and Changes to the Changepoint Intellectual Property, except for
any Change the ownership of which is to be owned by OEM pursuant to the
provisions of Section 10.6; provided, however, that during the Term of this
Agreement, any such Changepoint Changes shall be deemed Changepoint Software for
purposes of this Agreement.
10.5 OWNERSHIP OF OEM INTELLECTUAL PROPERTY
OEM shall retain ownership of Intellectual Property Rights in
Integrative Code except for: (i) any previously owned materials that Changepoint
may provide to OEM to assist OEM in the development of the Integrative Code; and
(ii) any discrete modules/programs that are
-20-
developed by Changepoint in providing such assistance. OEM agrees that
Changepoint shall own all Intellectual Property Rights in the materials
described in clauses (i) and (ii) above.
10.6 OWNERSHIP OF CHANGES
The parties agree that the Changes and all Intellectual Property Rights
in and to Changes shall be owned as follows:
(a) if developed by Changepoint, it shall be owned by Changepoint
and the licenses granted to OEM pursuant to Sections 2.1(a)
and 2.1(b) shall apply to such Changes; and
(b) if developed by OEM pursuant to Section 6.1(c), then subject
to any agreement to the contrary by the parties, it shall be
owned by OEM. However, and for greater certainty, OEM shall
not own or have any Intellectual Property Right in any part of
any intellectual property or software which forms part of the
Changepoint Software. OEM may market and distribute such
Change in conjunction with the Changepoint Software.
Changepoint shall have the option by notice to OEM to purchase
the Change and all Intellectual Property Rights therein or to
obtain a license to market, distribute, reproduce, create
derivative works and sublicense such Change. Upon a request by
Changepoint, the parties will use good faith efforts to agree
upon the terms of any such sale or licensing of such Change.
Failing agreement, Changepoint shall have the option of
submitting any dispute as to the price or terms of any such
license or sales to arbitration pursuant to the provisions of
Section 14.12.
10.7 RESIDUAL INFORMATION
The provisions related to ownership of Changes and Integrative Code
referred to in Sections 10.5 and 10.6 shall not restrict internal business use
of "Residual Information" by a party to develop a competitive or comparable
software feature or product where such Residual Information was obtained in
connection with the party's development of a Change or Integrative Code provided
however that neither party knowingly uses the Confidential Information of the
other party. "Residual Information" as used in this section means technical
information which is retained in the unaided memories of a parting party
receiving technical information from the other party's employees or contractors.
However, nothing in this Section 10.7 grants the receiving party any right or
license under any trademark, copyright or patent now or hereafter owned or
controlled by the party disclosing the technical information. For the avoidance
of doubt, nothing herein shall prevent the party not owning a Change or
Integrative Code from developing a similar Change or Integrative Code provided
that none of the Intellectual Property Rights of the other party is used in the
course of such development.
-21-
10.8 FURTHER ASSURANCES
To the extent that any Intellectual Property Rights do not vest
automatically in the party that is to own the rights pursuant to this Article,
the other party assigns (and to the extent necessary agrees to assign) all
relevant Intellectual Property Rights in and to such Changes or Integrative Code
to the other party.
ARTICLE 11 - CONFIDENTIAL INFORMATION
11.1 CONFIDENTIAL OBLIGATION
Each party acknowledges that Confidential Information will be exchanged
between the parties pursuant to this Agreement. Each party shall use no less
than the same means it uses to protect its similar confidential and proprietary
information, but in any event not less than reasonable means, to prevent the
disclosure and to protect the confidentiality of the Confidential Information of
the other party. Except as otherwise provided herein, each party agrees that it
will not use the Confidential Information of the other party except for the
purposes of this Agreement and will not disclose such Confidential Information
or make it available to third persons other than to its full-time employees or
its professional consultants having a need for access to such Confidential
Information in connection with their employment with such party and with respect
to whom such party takes steps, no less rigorous than those it takes to protect
its own proprietary information, but in any event not less than reasonable
means, to prevent such employees or professional consultants from acting in a
manner inconsistent with the terms of this Agreement. Information disclosed by
either party, in any form regarding pre-released products, access numbers and
passwords provided to the Recipient party, shall be deemed to be Confidential
Information. OEM and Changepoint, and their respective Affiliates, shall treat
the terms and conditions of this Agreement as confidential; however, either
party may disclose such information in confidence to its immediate legal and
financial consultants as required in the ordinary course of that party's
business. Nothing in this Section shall be construed to require either party to
refuse to disclose any information as and to the extent required by valid
judicial or governmental order, as long as such party makes reasonable efforts
to provide the other party sufficient prior notice to permit it to meaningfully
contest such order.
11.2 PUBLICLY KNOWN INFORMATION
Notwithstanding Section 11.1, the Recipient of Confidential Information
may use or disclose the Confidential Information to the extent that such
Confidential Information is (i) already known by the Recipient without an
obligation of confidentiality, (ii) publicly known or becomes publicly known
through no unauthorized act of the Recipient, (iii) rightfully received from a
third party, (iv) independently developed by the Recipient without use of the
information of the Disclosing Party, (v) approved by the Disclosing Party for
disclosure, or (vi) required to be disclosed pursuant to a requirement of a
governmental agency or law so long as the Recipient provides the other party
with notice of such requirement prior to any such disclosure and takes all
reasonable steps available to maintain the information in confidence.
-22-
11.3 RETURN OF CONFIDENTIAL INFORMATION
Upon the termination or expiration of this Agreement, each party will
return to the other all programs, documents and information, however recorded,
which contain any of the other's Confidential Information. Notwithstanding the
foregoing, OEM may retain a copy of that portion of Changepoint's Confidential
Information to the extent necessary to exercise its rights under Section
13.5(a).
11.4 THIRD PARTY INFORMATION
Each party agrees not to disclose or deliver to the other any
proprietary, confidential, secret or private information or intellectual
property including any software of any third person which it is under a duty or
has contracted not to disclose, without the prior written consent of such third
person and the other party.
11.5 LOSS OF CONFIDENTIAL INFORMATION
In the event of any unauthorized disclosure or loss of, or inability to
account for, Confidential Information of the furnishing party, the receiving
party will notify the furnishing party immediately.
11.6 REVERSE ENGINEERING
(a) OEM acknowledges that the Changepoint Software is valuable
Confidential Information of Changepoint or licensors of Changepoint.
Accordingly, OEM agrees not to disassemble, decompile, translate or convert into
human readable form or into another computer language, reconstruct or decrypt or
reverse engineer, all or any part of the Changepoint Software.
(b) Changepoint acknowledges that the OEM Software is valuable
Confidential Information of OEM or licensors of OEM. Accordingly, Changepoint
agrees not to disassemble, decompile, translate or convert into human readable
form or into another computer language, reconstruct or decrypt or reverse
engineer, all or any part of the OEM Software.
11.7 ENFORCEMENT OF CONFIDENTIALITY OBLIGATION
Each of OEM and Changepoint acknowledges and agrees that irreparable
injury may result to the other party if such party breaches the provisions of
this Agreement relating to Confidential Information and that damages may be an
inadequate remedy in respect of such breach. Each party hereby agrees in advance
that, in the event of such breach, the other party shall be entitled to seek, in
addition to such other remedies, damages and relief as may be available under
applicable law, the granting of injunctive relief in such party's favour.
-23-
ARTICLE 12 - WARRANTIES AND COVENANTS
12.1 CHANGEPOINT WARRANTIES
Changepoint represents, warrants and covenants to OEM that (i) it has
the right and power to enter into and fully perform this Agreement, (ii) in
entering into this Agreement, Changepoint is not and will not be in breach of
any contractual or other obligation to any third party, (iii) that, in the form
delivered by Changepoint, the Changepoint Software and the Changepoint Upgrades
will not contain any virus, and (iv) the pricing practices (fee or free) that it
applies in connection with Upgrades and Maintenance Releases under this
Agreement for the benefit of End Users shall be the same as are applied to
Changepoint's own end users.
12.2 LIMITED WARRANTY
Changepoint warrants, for the benefit only of OEM, that (i) the
Changepoint Software conforms in all material respects to the Documentation when
used as specified in the Documentation and within the scope of the license
granted to OEM herein and (ii) the Changepoint Software shall be able to
accurately process date data (including but not limited to, calculating,
comparing and sequencing) from, into and between the 20th and 21st century,
however, such warranty does not apply to any failure to process date data that
results from any software other than the Changepoint Software or that relates to
accepting data from any software or hardware not supplied by Changepoint, (the
"Software Warranty"). The Software Warranty does not apply (i) to the extent
that OEM has changed, modified or enhanced the Changepoint Software, except as
authorized under this Agreement (e.g., the cosmetic rebranding contemplated
under Section 2.1(a)) and then only to the extent of such change, modification
or enhancement (ii) if the failure to conform to the Documentation is due to its
use in combination with the OEM Software or the Integration thereof with the
Changepoint Software; or (iii) the Changepoint Software is not used as specified
by Changepoint in the Changepoint Documentation or if the failure to comply with
the Documentation is due to computer equipment or third party product
malfunctions or any cause external to the Changepoint Software; or (iv)
Changepoint has not been notified of the existence and nature of such
nonconformity or defect after discovery of same by OEM. OEM shall be entitled to
extend End Users warranties that are similar to the Software Warranty provided
that any such warranty claims by End Users shall be made to and handled by and
through OEM, without the visible involvement of Changepoint.
12.3 EXCLUSIVE REMEDIES
(a) For any breach of the Software Warranty, OEM's sole and exclusive
remedies and Changepoint's entire obligation shall be to use reasonable efforts
to fix, bypass or replace the portions of the Changepoint Software that fail to
substantially comply with the Software Warranty; or, in the event such
reasonable efforts are unsuccessful, to accept a return of the defective
software and provide to OEM a complete refund of the applicable License Fee
Royalty and Maintenance Fee Royalty provided that OEM has paid or is legally
obligated to pay such amounts to an End User.
(b) Changepoint makes no representations or warranties of any kind with
respect to the operation or use of any Third Party Software.
-24-
(c) The remedies in this Section 12.3 are expressly in lieu of any or
all other remedies in warranty that may be available to OEM resulting from the
use, performance, non-performance, or quality of any of the Changepoint
Software; provided, however, that in no event shall the warranty coverage
afforded End Users hereunder be more limited than that provided to Changepoint
licensees under Changepoint's standard end user license agreement, a copy of
which is attached hereto as Schedule G.
12.4 INTELLECTUAL PROPERTY
(a) Changepoint or licensors of Changepoint will defend, at its
expense, any action brought against OEM or an End User to the extent that it is
based on a claim that the use of the Changepoint Software within the scope and
as authorized by this Agreement infringes any Canadian or United States
copyright, patent or trade secret of any third person and will indemnify OEM or
an End User from any costs, damages, and legal fees finally awarded against OEM
or an End User by a court of competent jurisdiction from which no appeal is
taken or from which all appeals have been dismissed in such action which are
attributable to such claim and pay any settlements approved in writing by
Changepoint; provided that OEM and/or the End User, as applicable, notifies
Changepoint promptly in writing of same; and provided further that OEM and/or
the End User, as applicable, permits Changepoint or licensors of Changepoint to
defend, compromise or settle the claim and provides all available information,
assistance and authority to enable Changepoint or its licensors to do so.
Changepoint shall not be liable to reimburse OEM or an End User for any
compromise or settlement made by OEM or the End User without Changepoint's prior
written consent, or for any legal fees or expenses incurred by OEM in connection
with such claim. Neither OEM nor an End User shall have authority to settle any
claim on behalf of Changepoint.
(b) In the event Changepoint receives information concerning an
Intellectual Property Right infringement claim (including a claim referred to in
Section 12.4(a) related to the Changepoint Software, it may, at its expense and
without obligation to do so, either (i) procure for (A) OEM the right to
continue to use the allegedly infringing Changepoint Software in accordance with
the provisions of this Agreement, and (B) the End User the right to continue to
use the allegedly infringing Changepoint Software, (ii) replace or modify the
Changepoint Software to make it not infringing, in which case, OEM shall
thereupon cease distribution and copying of the allegedly infringing Changepoint
Software and shall distribute to and install for End Users, at Changepoint's
sole expense, the replacement or modified software, or (iii) terminate this
Agreement whereupon OEM shall cease all distribution and copying of the
allegedly infringing Changepoint Software except to the extent contractually
required to do so prior to the termination by Changepoint, and Changepoint shall
refund to OEM the full amount of the applicable License Fee Royalties less
depreciation for actual use calculated at the rate of twenty percent (20%) per
annum on a straight-line basis calculated from the date of the commencement of
such use.
(c) Changepoint shall have no liability for any Intellectual Property
Right infringement claim based on (i) OEM's distribution and copying of the
allegedly infringing Software following termination of this Agreement by
Changepoint as provided for in paragraph (b)(iii) above except to the extent
authorized by such clause, (ii) OEM's or any End User's
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internal use of any Changepoint Software which continues after Changepoint's
notice that OEM and all End Users to which OEM has distributed directly or
indirectly the allegedly infringing Changepoint Software should cease using
the allegedly infringing Changepoint Software due to a claim; (iii)
combination of the Changepoint Software with any other non-Changepoint
product, program or data to the extent the infringement would not occur
absent such combination; (iv) any claim that the infringement results from or
relates to the Third Party Software except to the extent the infringement is
attributable to the Changepoint Software; (v) adaptation or modification of
any Changepoint Software except to the extent the infringement would not
occur absent such adaptation or modification; or (vi) that relates solely to
the use, copying, or distribution of the OEM Software or the Integrative Code
except for those portions (if any) of the Integrative Code which may be owned
by Changepoint pursuant to the provisions of Section 10.5. For claims in this
Section 12.4(c) for which OEM is responsible, OEM agrees to defend, at its
expense, any action brought against Changepoint and its Affiliates to the
extent of the same, and to indemnify Changepoint and its Affiliates from and
against all damages, costs and expenses, including reasonable attorney's fees
finally awarded against Changepoint and its Affiliates by a court of
competent jurisdiction from which no appeal is taken or from which all
appeals have been dismissed in such action which are attributable to such
claim and to pay any settlements approved in writing by OEM; provided that
Changepoint notifies OEM promptly in writing of same; and provided further
than Changepoint permits OEM to defend, compromise or settle the claim and
provides all available information, assistance and authority to enable OEM to
do so. OEM shall not be liable to reimburse Changepoint for any compromise or
settlement made by Changepoint without OEM's prior written consent, or for
any legal fees or expenses incurred by Changepoint in connection with such
claim. Changepoint shall have no authority to settle any such claim on behalf
of OEM.
(d) For any Intellectual Property Right claim attributable in part to
the Changepoint Software and in part to the OEM Software, OEM and Changepoint
each agree to contribute to any liability resulting from such Intellectual
Property Right claim in proportion to such party's comparative responsibility in
causing such liability.
(e) This Section 12.4 states the entire liability of Changepoint and
OEM and Changepoint's and OEM's sole remedies, respectively with respect to any
Infringement Claim.
12.5 DISCLAIMER
(a) EXCEPT FOR THE EXPRESS WARRANTIES CONTAINED HEREIN, THERE ARE NO
OTHER WARRANTIES OR CONDITIONS WHETHER EXPRESS OR IMPLIED HEREIN MADE BY EITHER
PARTY, INCLUDING ANY IMPLIED WARRANTIES OR CONDITIONS OF MERCHANTABLE QUALITY,
FITNESS FOR A PARTICULAR PURPOSE, TITLE OR THOSE ARISING BY STATUTE OR OTHERWISE
BY LAW OR FROM A COURSE OF DEALING OR USE OF TRADE, ALL OF WHICH ARE EXPRESSLY
DISCLAIMED.
(b) IN NO EVENT WILL CHANGEPOINT OR OEM BE LIABLE FOR SPECIAL,
INCIDENTAL, INDIRECT OR CONSEQUENTIAL LOSS OR DAMAGE, LOST BUSINESS REVENUE,
LOSS OF PROFITS, LOSS OF DATA, FAILURE TO REALIZE EXPECTED PROFITS OR SAVINGS,
DAMAGES FOR DELAY, EXEMPLARY OR PUNITIVE
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DAMAGES OR ANY CLAIM AGAINST OEM BY ANY OTHER PERSON EVEN IF OEM OR
CHANGEPOINT, AS THE CASE MAY BE, HAS BEEN ADVISED OF THE POSSIBILITY OF ANY
SUCH LOSS OR DAMAGE.
(c) EACH PARTY'S MAXIMUM LIABILITY TO THE OTHER UNDER THIS AGREEMENT
SHALL IN NO EVENT EXCEED THE AMOUNTS PAID BY OEM TO CHANGEPOINT AS OF THE DATE
THE CLAIMING PARTY FIRST BECAME AWARE OR OUGHT TO HAVE BECOME AWARE OF SUCH
CLAIM. PROVIDED THAT NOTHING IN THIS AGREEMENT SHALL EXCLUDE OR RESTRICT A
PARTY'S LIABILITY FOR DEATH OR PERSONAL INJURY ARISING FROM THE NEGLIGENCE OF
THE PARTY OR ITS EMPLOYEES WHILE ACTING IN THE COURSE OF THEIR EMPLOYMENT.
(d) Each party shall be liable to the other as expressly provided for
in this Agreement but shall have no other obligation, duty or liability
whatsoever in contract, tort or otherwise to the other including any liability
for negligence.
(e) The limitations, exclusions and disclaimers in this agreement shall
apply irrespective of the nature of the cause of action, demand, or action by
either party, including but not limited to breach of contract, negligence, tort
or any other legal theory and shall survive a fundamental breach or breaches or
the failure of the essential purpose of this Agreement or of any remedy
contained herein. Notwithstanding the foregoing, the limitations, exclusions and
disclaimers in Sections 12.5(b) and 12.5(c) shall not apply to any claim or
breach of Sections 2.5, 2.6 or 12.4 or Articles 10 or 11.
(f) Neither party shall be responsible or liable for any loss, damage
or inconvenience suffered by the other or by any third person, to the extent
that such loss, damage or inconvenience is caused by the failure of the other
party to comply with its obligations under this Agreement.
(g) The parties expressly waive any right to a jury trial regarding
disputes arising from or related to this Agreement.
12.6 WARRANTY AND COVENANTS OF OEM
(a) OEM represents, warrants and covenants to Changepoint that (i) it
has the right and power to enter into and fully perform this Agreement, and (ii)
in entering into this Agreement, OEM is not and will not be in breach of any
contractual or other obligation to any third party.
(b) OEM agrees to provide End Users with support of a technical nature
for all aspects of the OEM Application Suite including its installation and use;
provided, however, that Changepoint provides the services described in Section
8.1(a) and the implementation assistance described in Section 3.4. To this end
OEM shall employ and make available to End Users technically qualified personnel
in sufficient numbers to provide such services.
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CONFIDENTIAL TREATMENT
(c) During the term of this Agreement, Changepoint will provide to OEM
Maintenance Releases for the Changepoint Software. OEM will use commercially
reasonable efforts to enter into Customer Maintenance Agreements with End Users
to provide support and maintenance to End Users. OEM agrees to offer maintenance
and support services to all End Users and to assist End Users who have purchased
Customer Maintenance Agreements in the installation and use of Changepoint
Upgrades delivered by Changepoint hereunder.
(d) OEM shall not make to any End User any representation or warranty
with respect to the Changepoint Software or any Changepoint Upgrades or the use
thereof in the name of, as agent for, or on behalf of Changepoint.
(e) OEM agrees to defend, indemnify and hold Changepoint harmless from
and against any and all claims arising as a result of any claim by an End User
regarding: (i) OEM's improper installation or Integration of the Changepoint
Software or any Changepoint Upgrades; (ii) any computer software virus
introduced by OEM that can be demonstrated to have been in the copy of the
Changepoint Software or any Changepoint Upgrades delivered to the End User; and
(iii) its use or inability to use the Changepoint Software if such claim would
not have occurred solely from the use of the Changepoint Software or the
Changepoint Upgrade.
ARTICLE 13 - TERM AND TERMINATION
13.1 TERM
The term of this Agreement shall commence on the Effective Date and
shall continue until December 31, 2001. Thereafter it shall automatically
renew up to four (4) successive one (1) year periods if OEM meets at least
*** of the then-current year's Sales Target, set in accordance with Section
5.4. If OEM does not meet *** of such Sales Target, renewal for an additional
one (1) year period shall be at Changepoint's discretion. If Changepoint
elects not to renew the Agreement, it shall terminate one hundred and eighty
(180) days from the provision of a notice from Changepoint to OEM of its
decision not to renew. Unless otherwise agreed to by the parties in writing
this Agreement shall terminate no later than December 31, 2005.
13.2 TERMINATION
To the extent permitted by applicable law, either party may
terminate this Agreement by notice in writing to the other party in the event
that (i) a receiver, trustee, liquidator, administrator or administrative
receiver should be appointed for either party or its property, (ii) either
party should become insolvent or unable to pay its debts as they mature or
cease to pay its debts as they mature in the ordinary course of business, or
makes an assignment for the benefit of creditors, or makes a proposal to its
creditors or files a notice of intention to do so, (iii) any proceedings
should be commenced against either party under any bankruptcy, insolvency, or
debtor's relief law, and such proceedings shall not be vacated or set aside
within fifteen (15) days from the date of commencement thereof, or (iv)
either party should be liquidated or dissolved.
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
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13.3 TERMINATION FOR CAUSE
(a) Changepoint may terminate this Agreement immediately upon written
notice to OEM in the event that (i) OEM fails to make any payment as and when
due to Changepoint (unless such payment is disputed by OEM) or fails to provide
the reports required pursuant to Section 9.3, and, in either case, fails to cure
same within thirty (30) days of receiving notice of such failure from
Changepoint or (ii) OEM fails to perform or breaches any material obligation,
duty or responsibility imposed on it under this Agreement and, in the event any
of the foregoing occur, OEM fails to cure such default or terminate such event
within thirty (30) days of receiving notice of such failure/breach from
Changepoint.
(b) OEM may terminate this Agreement immediately upon written notice to
Changepoint in the event that Changepoint fails to perform or breaches any
material obligation, duty or responsibility imposed under this Agreement,
including payment of any monies which may become due and owing to OEM hereunder
(unless such payment is disputed by Changepoint), and fails to cure such default
within thirty (30) days of receiving notice of such failure/breach from OEM.
13.4 TERMINATION FOR CONVENIENCE
OEM may terminate this Agreement for convenience upon ninety (90) days
prior written notice.
13.5 EFFECT OF TERMINATION
(a) Upon termination or expiration of this Agreement for any reason
other than for breaches by OEM of the provisions of Article 11 (Confidential
Information), or Section 2.6, or the failure of OEM to make any of the payments
due to Changepoint hereunder (unless such payment is the subject of a good faith
dispute between the parties), OEM may continue to provide support and
maintenance services to End Users for a period of three (3) months, or until the
expiry of the Customer Maintenance Agreement (provided that such expiry date is
a maximum of twelve (12) months from the date of expiration or termination of
this Agreement), whichever is greater.
(b) Upon termination or expiration of this Agreement for any reason:
(i) OEM shall notify End Users of the termination of this
Agreement and offer them the option of contracting
with Changepoint directly for maintenance;
(ii) the License shall terminate and OEM shall cease all
Integration, reproduction and distribution of the
Changepoint Software and the OEM Application Suite;
(iii) End User Licenses permitted hereunder and which have
been granted prior to the termination of this
Agreement shall survive the termination for as
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long as the End Users are not in breach of their
respective End User Licenses;
(iv) Changepoint and OEM will co-operate to minimize any
negative publicity regarding the other that could
arise from the termination of the relationship; and
(v) Changepoint and OEM will work jointly in good faith
to establish a process and cost sharing arrangement
for maintaining the interfaces between the
Changepoint Software and the other programs in the
OEM Application Suite for those End Users that wish
to continue to use the OEM Application Suite.
13.6 RETURN OF MATERIALS
Upon termination of this Agreement for any reason, OEM agrees promptly
to return or destroy, at Changepoint's option all materials provided by, or
which reference in any way, Changepoint or the Changepoint Software except such
Changepoint Technical Documentation as may be necessary for OEM to exercise its
rights under Section 13.5(a); provided, however, that following the termination
of such End User support as is authorized under such Section, OEM shall promptly
return or destroy, at Changepoint's option, any such retained materials.
Effective upon the termination of this Agreement, OEM shall cease to use all
trade-marks, marks and trade names of Changepoint. Upon termination of this
Agreement for any reason, Changepoint agrees promptly to return or destroy, at
OEM's option all materials provided by OEM or which reference in any way, OEM or
the OEM Software.
13.7 SURVIVAL
The provisions of Articles 9 ( other than 9.1 and 9.5), 10 (other than
10.2 and 10.3), and 11 and Sections 2.4, 2.5, 2.6, 7.1(d), 12.4, 12.5, 12.6(e),
13.5 13.6, 13.7, 14.7, 14.10, 14.12 and 14.13 shall remain in force and effect
after the termination or expiration of this Agreement until such time as the
parties may mutually agree to the release of the obligations contained herein.
In addition, the provisions of Article 8 shall survive the termination or
expiration of this Agreement for such period as OEM continues to provide support
to End Users as authorized under Section 13.5(a).
ARTICLE 14 - GENERAL
14.1 ASSIGNMENT
(a) Neither this Agreement nor any rights or obligations of a party
hereto may be assigned by OEM without the prior written consent of Changepoint,
which consent will not be unreasonably withheld or delayed. Any such purported
assignment without such consent shall be void. Notwithstanding the foregoing,
OEM may assign this Agreement in connection with the sale of all or
substantially all of its assets provided OEM provides reasonable notice of same
to Changepoint. Further, such assignment shall not be effective as between the
parties until such
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time as the assignee agrees in writing with Changepoint to be bound all the
provisions of this Agreement.
(b) Notwithstanding the foregoing, if OEM assign this Agreement in
connection with the sale of all or substantially all of its assets or merges or
amalgamates with one or more entities that are a direct competitor of
Changepoint, OEM agrees that Changepoint may terminate this Agreement
immediately upon written notice to OEM.
(b) Changepoint may assign this Agreement or any of its rights or
obligations on written notice to OEM. Notwithstanding the foregoing, if
Changepoint assigns this Agreement to a direct competitor of OEM, OEM may
exercise its right to terminate this Agreement for convenience pursuant to
Section 13.4.
(c) This Agreement shall inure to the benefit of and be binding upon
the successors and permitted assigns of the parties hereto.
14.2 FORCE MAJEURE
If the performance of this Agreement, or of any obligation hereunder,
by either party is interfered with by fire, explosion, an Act of God, war,
revolution, civil commotion, an act of public enemies, the prohibition of
exportation or importation or any other causes beyond the reasonable control of
the party then such party will be excused from performance to the extent of such
interference and the other party will likewise be excused from performance of
its obligations to the extent such party's obligations relate to the performance
so interfered with.
14.3 MODIFICATIONS AND AMENDMENTS
No modification of or amendment to this Agreement shall be valid or
binding unless set forth in writing and duly executed by the parties hereto and
no waiver of any breach of any term or provision of this Agreement shall be
effective or binding unless made in writing and signed by the party purporting
to give the same and, unless otherwise provided, shall be limited to the
specific breach waived.
14.4 RELATIONSHIP BETWEEN THE PARTIES
Nothing contained in this Agreement shall be construed to give either
party the power to direct or control the day-to-day activities of the other.
Changepoint and OEM are independent persons and nothing herein shall be
construed to create any partnership, joint venture, agency or other similar
relationship. Neither party has the power or authority, directly or indirectly,
or through its servants to bind the other party to any agreement with any third
person or otherwise to contract, or enter into a binding relationship or make
any representation, warranty or contractual commitment for or on behalf of the
other party. Neither of the parties shall be or become liable or bound by any
agreement, representation, act or omission whatsoever of the other party unless
specifically provided for in this Agreement.
-31-
14.5 EXPORT CONTROLS
OEM acknowledges that the license and distribution of the Changepoint
Software are subject to the export control laws and regulations of Canada and
the United States of America, and any amendments thereof, which restrict exports
and re-exports of software, technical data, and direct products of technical
data, including services derived from the use of the Changepoint Software. OEM
agrees that it will not export or re-export any Changepoint Software, or any
information and documentation related thereto, directly or indirectly, without
first obtaining permission to do so as required by all applicable laws or
regulations to any countries, End Users or for any end uses that are restricted
by the Canadian or United States export laws and regulations, and any amendments
thereof.
14.6 RESTRICTED RIGHTS
No licensing of the OEM Application Suite shall be made to the United
States Government without the prior written agreement of Changepoint as to the
form and substance of the restricted rights legends to be applied to the OEM
Application Suite.
14.7 NOTICES
Any demand, notice or other communication to be given in connection
with this Agreement shall be given in writing and shall be given by personal
delivery, by registered or certified first class mail, by Federal Express or
other express courier or by electronic means of communication addressed to the
recipient as follows:
To Changepoint:
0000 Xxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxx Xxxx, Xxxxxxx
X0X 0X0
Telecopy: (000) 000-0000
Attention: Chief Financial Officer
To OEM:
00 Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxxxxx
XXX 00000
Telecopy: (000) 000-0000
Attention: Chief Financial Officer
or to such other address, individual or electronic communication number as may
be designated hereafter from time to time by notice given by either party to the
other. Any demand, notice or other communication given by personal delivery or
express courier shall be conclusively deemed
-32-
to have been given on the business day of actual delivery thereof and, if
given by registered or certified mail, on the 4th business day following the
deposit thereof in the mail and, if given by electronic communication, on the
day of transmittal thereof if given during the normal business hours of the
recipient and on the business day during which such normal business hours
next occur if not given during such hours on any day. If the party giving any
demand, notice or other communication knows or ought reasonably to know of
any difficulties with the postal system which might affect the delivery of
mail, any such demand, notice or other communication shall not be mailed but
shall be given by personal delivery, express courier or by electronic
communication.
14.8 SEVERABILITY
If a court or other lawful authority of competent jurisdiction declares
any provision or Section of this Agreement invalid, illegal or unenforceable,
this Agreement will continue in full force and effect with respect to all other
provisions and Sections and giving as much adherence as lawful to the spirit of
the invalid, illegal or unenforceable clause, and all rights and remedies
accrued under such other provisions and Sections will survive any such
declaration.
14.9 PRESS RELEASE
OEM and Changepoint shall jointly develop a press release or similar
statement, mutually acceptable to both parties, describing the existence of the
relationship contemplated by this Agreement and the scope of their respective
activities and furtherance hereof. Each party shall be entitled to publish the
press release or similar statement.
14.10 GOVERNING LAW
This Agreement shall be exclusively governed by and construed in
accordance with the laws in force in the State of New York without reference to
its conflict of laws principles. Both parties submit to the jurisdiction of the
courts of the State of New York for any legal action arising out of this
Agreement or the performance of the obligations hereunder which shall be the
exclusive forum for any claim brought hereunder. This Agreement, and the rights
and obligations of the parties under this Agreement, will not be governed by the
provisions of the 1980 UNITED NATIONS CONVENTION ON CONTRACTS FOR THE
INTERNATIONAL SALE OF GOODS.
14.11 COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original and of which taken together shall be
deemed to constitute one and the same instrument.
14.12 DISPUTE RESOLUTION AND ARBITRATION
In the event that any dispute or disagreement arises between OEM and
Changepoint with respect to (i) the interpretation of any provision of this
Agreement, (ii) the performance of Changepoint or OEM under this Agreement, or
(iii) any other matter related to this Agreement, upon the written request of
either party, the parties will meet for the purpose of resolving such
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dispute. The parties agree to discuss the problem and negotiate in good faith
without the necessity of any formal proceedings related thereto. No formal
proceedings for the resolution of such dispute may be commenced until either
party concludes in good faith that the applicable resolution through
continued negotiation of the matter in issue does not appear likely. The
parties further agree that all disputes hereunder which cannot be settled in
the manner hereinbefore described (any such dispute is referred to here as a
"Dispute") will be settled by final and binding arbitration conducted in
accordance with the American Arbitration Association (or any successor
thereto), as amended from time to time. Judgment upon the award rendered in
any such arbitration may be entered in any court having jurisdiction thereof,
or application may be made to such court for a judicial acceptance of the
award and an enforcement, as the law of such jurisdiction may require or
allow. Notwithstanding the foregoing, disputes with respect to any
infringement claim including without limitation any claim based on the
infringement, violation or misappropriation of any Intellectual Property
Right shall not be settled by arbitration, without the prior written consent
of the parties.
The arbitration panel will be composed of one person appointed by the
party requesting the arbitration (the "Applicant"), one person appointed by the
other party (the "Respondent") and a third person to act as chairperson, chosen
by the two arbitrators, or, if both parties agree, the arbitration panel will
consist of a sole arbitrator. No person may be appointed as an arbitrator unless
he or she is independent of the Applicant and Respondent, is skilled in the
subject matter of the Dispute and is not directly or indirectly carrying on or
involved in a business being carried on in competition with the business of the
parties. The decision of the arbitration panel shall be made by a majority vote
or by the sole arbitrator, as the case may be. In the event of the failure of
the arbitration panel to reach a majority decision, the decision of the
chairperson shall constitute the decision of the arbitration panel. The venue
for the arbitration shall be at New York City, New York unless otherwise agreed
to by the parties in writing. The arbitration shall be conducted pursuant to the
legislation in the State of New York implementing the MODEL LAW ON INTERNATIONAL
COMMERCIAL ARBITRATION adopted by the United Nations Commission on International
Trade Law.
14.13 ENTIRE AGREEMENT
This Agreement and the schedules attached hereto constitute the entire
Agreement between the parties hereto with respect to the subject matter hereof
and cancels and supersedes any prior understandings and Agreements between the
parties hereto with respect thereto. There are no representations, warranties,
terms, conditions, provisions, undertakings or collateral Agreements, expressed,
implied or statutory, between the parties other than as expressly set forth in
this Agreement.
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IN WITNESS WHEREOF the parties have executed this Agreement as of the Effective
Date by their duly authorized officers.
CHANGEPOINT INC. SOFTRAX CORPORATION
Per: _______________________________ Per: ________________________________
Title: _____________________________ Title: ______________________________
SCHEDULE A-1
CHANGEPOINT SOFTWARE
SQL Edition:
Service Delivery Management
Project and Resource Management
Customer Relationship Management
Support Management
Guest User Access
SCHEDULE A-2
OEM SOFTWARE
SOFTRAX Financial applications
SOFTRAX Operations applications
SOFTRAX Web applications
SCHEDULE B
TERMS AND CONDITIONS FOR END USER LICENSES
The End User License shall contain the following provisions:
-the Documentation may be used solely in conjunction with the
applicable Changepoint Software provided to the End User.
-the Changepoint Software must be used in and not transferred or
exported outside of the Territory except in accordance with applicable
laws and regulations regarding the export of technology enacted by the
United States and/or Canadian government.
-an express prohibition against the granting of sublicenses to any
portion of the Changepoint Software or the OEM Application Suite
without the prior written consent of OEM and Changepoint.
-End Users may not make copies of the Changepoint Software, except for
making back-up or archival copies thereof. All copies must include
proprietary, copyright, trademark and other proprietary legends of
Changepoint in the same form and locations as the legends appearing on
or in the said software.
-an acknowledgement that OEM or its licensors retain the title to and
Intellectual Property Rights in the Changepoint Software.
-an acknowledgement that the Changepoint Software contains trade
secrets of licensors of OEM and a requirement that the End User use no
less than the same means it uses to protect its similar confidential
and proprietary information, but in any event not less than reasonable
means, to prevent the disclosure and to protect the confidentiality of
the said software.
-a covenant not to disassemble, decompile, translate or convert into
human readable form or into another computer language, reconstruct or
decrypt or reverse engineer, all or any part of the Changepoint
Software.
-a requirement that upon the termination or expiration of the End User
License that the End User return to OEM all copies of the Changepoint
Software or certify to OEM that all copies have been destroyed and
cease using the said software.
-a disclaimer that licensors of OEM shall have no liability to End
Users including any liability for damages, whether direct, indirect,
incidental or consequential or for loss of profits arising from or
related to the use of the Changepoint Software provided by OEM to the
End User or the OEM Application Suite.
-an acknowledgement that OEM's licensors of software are intended third
party beneficiaries of the End User License and may enforce it directly
against the End User.
SCHEDULE C
TRAINING MATERIALS
End User Training Manual
Customer Relationship Training Manual
Revenue Management Training Manual
Service Delivery Training Manual
CONFIDENTIAL TREATMENT
SCHEDULE D
ROYALTIES
1. LICENSE FEE ROYALTIES
OEM will pay Changepoint License Fee Royalties on all licenses sold by
OEM of Changepoint Software. For purposes of this Schedule, the term "License
Fee" shall refer to the actual selling price of the Changepoint Software license
charged by OEM. The License Fee Royalty paid will be calculated by multiplying
the applicable Royalty Percentage (based on the table in section 1.1 below) by
the greater of (a) the License Fee or (b) the Minimum Royalty Factor (as defined
in section 1.3 below).
1.1 Royalty Percentage
The Royalty Percentage to be used in
calculating the License Fee Royalty
payable by OEM to Changepoint
hereunder shall be determined by the
following table:
-----------------------------------------------------------------------
Aggregate Revenues in Applicable Royalty
License Fees to OEM during Percentage
Calendar Year
-----------------------------------------------------------------------
*** ***
-----------------------------------------------------------------------
*** ***
-----------------------------------------------------------------------
*** ***
-----------------------------------------------------------------------
*** ***
-----------------------------------------------------------------------
*** ***
-----------------------------------------------------------------------
For the purposes of this Schedule D, revenues received in calendar year
1999 shall be considered as received in calendar year 2000. In
addition, the applicable royalty percentage shall be reduced by
*** for all sales closed during the period beginning on the
Effective Date and running through June 30, 2000.
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
CONFIDENTIAL TREATMENT
1.1.1 OEM may, at its option, lock in a royalty percentage rate to
be applied from the first dollar of revenue in a calendar year
by paying the fee associated with such rate as indicated in
the following table:
------------------------------------------------------------
Royalty Percentage
from $0 to commitment
Discount Level level Fee
------------------------------------------------------------
*** *** ***
------------------------------------------------------------
*** *** ***
------------------------------------------------------------
*** *** ***
------------------------------------------------------------
1.1.2 Royalty payments for License Fee revenue in excess of the
discount level contracted for would be calculated using the
royalty percentage set forth in the table in section 1.1 above
applicable to the aggregate revenue amount achieved by OEM for
the applicable calendar year (including all revenues for which
the contracted discount percentage was applied).
1.1.3 In the event OEM elects to lock in a Royalty Percentage rate
pursuant to the terms of section 1.1.1 above, the choice of
the applicable rate will be made by January 1st of each year
and an irrevocable commitment to pay Changepoint the
associated fee will be required at that time. Payment of the
fee will be made in 4 payments on the 15th day of February,
May, August and November.
1.1.4 If, at any time during the term of this Agreement, (a)
Changepoint elects to integrate into the Changepoint Software
or develops a new module for the Changepoint Software, in
either event which incorporates or requires third party
software, and (b) OEM, in its sole discretion, elects to
include such additional third party software as integrated
into or as an additional module to the Changepoint Software,
and (c) Changepoint provides OEM the right hereunder to
license such third party software to End Users, then OEM shall
remit to Changepoint, with respect to each license of any such
third party software, that amount which Changepoint actually
paid to the third party for the license of such software plus
fifty percent (50%) of the difference, if any, between the
list price of such third party software and the amount which
Changepoint actually paid to the third party for the license
of such software.
1.2 Minimum Royalty Factor
The current Price List is attached in Schedule E. For the calculation
of the Minimum Royalty Factor, the then applicable list prices, as per section
9.5, will be used. The Minimum Royalty Factor shall be determined by selecting
the list price for the license sold from the appropriate column(s) for the bands
and number of seats purchased from the Price List, multiplied by the number of
seats purchased and applying the additional discount from the table below:
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
CONFIDENTIAL TREATMENT
-------------------------------------------------------
SEATS ADDITIONAL DISCOUNT
-------------------------------------------------------
*** ***
-------------------------------------------------------
*** ***
-------------------------------------------------------
*** ***
-------------------------------------------------------
*** ***
-------------------------------------------------------
*** ***
-------------------------------------------------------
*** ***
-------------------------------------------------------
The resulting amount will be multiplied by the Royalty Percentage in
1.1 of this Schedule to determine the License Fee Royalty Amount.
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
CONFIDENTIAL TREATMENT
2. MAINTENANCE FEE ROYALTIES
OEM will pay Changepoint Maintenance Fee Royalties on all Customer
Maintenance Agreements for licenses sold by OEM. For purposes of this Schedule,
the term "License Fee" shall refer to the actual selling price of the
Changepoint Software license charged by OEM. Maintenance Fee Royalties are
annual fees.
The License Fee Royalty paid will be calculated by multiplying:
(i) the Applicable Royalty Percentage (based on the table
below)
(i) an amount equal to the Maintenance Percentage in
Schedule E (as may be amended from time to time
pursuant to by Section 9.5 of the OEM Agreement)
(iii) the greater of (a) the License Fee or (b) the Minimum
Royalty Factor (as defined in section 1.2 above).
----------------------------------------------------------------------
Aggregate Maintenance Revenues (in any Applicable Royalty
calendar year). Percentage
*** ***
*** ***
*** ***
----------------------------------------------------------------------
An Example:
1. Sale price: $ ***
2. Aggregate Maintenance Revenues (to date): $ *** (this means the
Applicable Royalty Percentage is *** %)
3. Maintenance Percentage: *** %
Calculation of Maintenance Fee Royalties: $100,000 x 18% x 30% = $5,400
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
CONFIDENTIAL TREATMENT
SCHEDULE E
CHANGEPOINT PRICE LIST
CHANGEPOINT DISCOUNT SCHEDULE
CHANGEPOINT LICENSES
1) SOFTWARE CAN BE LICENSED AS "FULL SEAT" WHICH INCLUDES THE MANDATORY
SERVICE DELIVERY MODULE AND THE THREE ADDITIONAL MODULES LISTED BELOW.
2) SOFTWARE CAN BE LICENSED BY MODULE WHICH MEANS THE MANDATORY SERVICE
DELIVERY MODULE AND ANY OR NONE OF THE ADDITIONAL MODULES ON THE
UNDERSTANDING THAT WHAT EVER MODULES ARE LICENSED FOR AN ENTERPRISE
MUST ALL BE THE SAME MODULES FOR ALL SEATS IN THE ENTERPRISE. THIS
MEANS THAT ONE SET OF USERS CANNOT HAVE SOME FUNCTIONS WHILE ANOTHER
SET OF USERS HAS DIFFERENT FUNCTIONS WITHIN THE SAME ENTERPRISE.
--------------------------------------------------------------------------------------------------
FULL SEAT SERVICE PROJECT &
SEATS DISCOUNT PRICE BANDS DELIVERY RES CRM SUPPORT
--------------------------------------------------------------------------------------------------
*** *** *** *** *** *** ***
-------------------------------------- --------------------------------------------------
*** *** *** *** *** *** ***
-------------------------------------- --------------------------------------------------
*** *** *** *** *** *** ***
-------------------------------------- --------------------------------------------------
*** *** *** *** *** *** ***
-------------------------------------- --------------------------------------------------
*** *** *** *** *** *** ***
-------------------------------------- --------------------------------------------------
*** *** *** *** *** *** ***
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------
GUEST ACCESS LICENSES SCENARIO
--------------------------------------------------------------------------
DEAL 500 FULL
EXAMPLE SEATS PRICE DISCOUNT SUB TOT PRICE
----------------------------------------- --------------------------------------------------------------------------
GUEST DISCOUNT FULL SEAT
PRICE *** *** *** *** ***
----------------------------------------- --------------------------------------------------------------------------
*** *** *** *** *** *** *** ***
----------------------------------------- --------------------------------------------------------------------------
*** *** *** *** *** *** *** ***
----------------------------------------- --------------------------------------------------------------------------
*** *** *** *** *** *** *** ***
----------------------------------------- --------------------------------------------------------------------------
*** ***
--------------------------------------------------------------------------
CUM DISC: ***
--------------------------------------------------------------------------
----------------------------------------- --------------------------------------------------------------------------
MAINTENANCE DEAL 1000 FULL
PERCENTAGE *** EXAMPLE SEATS PRICE DISCOUNT TOTAL PRICE
----------------------------------------- --------------------------------------------------------------------------
*** *** *** *** ***
--------------------------------------------------------------------------
*** *** *** *** ***
--------------------------------------------------------------------------
*** *** *** *** ***
--------------------------------------------------------------------------
*** *** *** *** ***
--------------------------------------------------------------------------
*** *** *** *** ***
--------------------------------------------------------------------------
*** *** *** *** ***
--------------------------------------------------------------------------
CUM DISC: ***
--------------------------------------------------------------------------
TERMS
- All discounts based on single order quantity
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
SCHEDULE F
ESCROW AGREEMENT
THIS AGREEMENT made as of this 17th day of January, 1997
between CHANGEPOINT CORPORATION ("Changepoint"), a company with offices located
at 0000 Xxxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx Xxxx, Xxxxxxx, Xxxxxx, X0X 0X0 and
MONTREAL TRUST COMPANY OF CANADA, a trust company with offices at 000 Xxxxx
Xxxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx, X0X 0X0 ("Escrow Agent") and those
customers of Changepoint or Affiliates of Changepoint who have requested to be
part of the escrow program established by this agreement and who are made party
to this agreement by signing the form of letter attached to this agreement as
schedule B ("Letter Agreement"), having same approved by Escrow Agent and having
copies of same returned to Changepoint and customer (each such customer shall be
referred to herein as a "Customer" and all such customers shall collectively be
referred to herein as the "Customers").
WHEREAS, Changepoint or an Affiliate of Changepoint has or
proposes to enter into agreements with Customers to provide certain maintenance
services (each such contract with a Customer shall be referred to as an
"Agreement" and all such contracts with Customers shall collectively be referred
to as the "Agreements") in respect of software licensed or to be licensed by
Changepoint or an Affiliate of Changepoint to Customers (the "Software").
AND WHEREAS, Changepoint and Customers wish to assure the
continued availability of the source code to the Software for the Customers in
the event of an Emergency condition and to establish and maintain in escrow the
source code for the Software;
AND WHEREAS, Escrow Agent agrees to store and release such
source code under the terms of this agreement.
NOW THEREFORE, in consideration of the premises and covenants
contained herein, the parties hereby agree as follows:
1. DEFINITIONS
In this agreement and in the Recitals and Schedules hereto,
unless otherwise specified or patently required by the context, the words and
phrases defined in this agreement shall have the meanings ascribed to them
herein and the following terms shall have the following meanings indicated
below:
"AFFILIATE" shall have the meaning ascribed to it in the
Canada Business Corporations Act as amended.
"EFFECTIVE DATE" means the date first written above.
"EMERGENCY" in relation to a Customer means:
-2-
A. Changepoint ceases to carry on business as a
going concern; or
B. Changepoint makes an assignment in
bankruptcy for the general benefit of its
creditors, or a receiving order is made
against Changepoint and such order is not
discharged within thirty (30) days of its
making;
AND within forty-five (45) days of any such
event in A or B above, (i) no entity
acquires the assets of Changepoint or (ii)
no entity is willing and able to support and
maintain the Software; or
C. Changepoint and its Affiliates (or their
successors or assigns) are unwilling or
unable in any material respect to comply
with the obligations under the Agreement
with the Customer to correct programming
errors in the Software delivered to the
Customer which materially and adversely
affect the Customer's use of such software
and has failed to take all reasonable steps
to cure such default after the receipt of no
less than thirty (30) business days prior
written notice (a "Changepoint Default").
"SOURCE CODE" in relation to any Customer means the source
code for the modules of the Software licensed by Changepoint or an Affiliate to
the Customer and identified as the Source Code applicable to the Customer.
"UPDATED SOFTWARE" means maintenance releases and other
changes or additions to the Software in object code form that are provided to a
customer as part of maintenance services under an Agreement.
"UPDATED SOURCE CODE" in relation to any Customer means an
amended version of the Source Code that incorporates all changes, modifications,
enhancements and updates pertaining to the Updated Software that have been
delivered to the Customer under an Agreement and identified as the Updated
Source Code applicable to the Customer.
2. DEPOSIT AND SUBSTITUTION
(a) Changepoint agrees to deposit in escrow with Escrow Agent for the
benefit of each Customer a copy of the Source Code applicable to the Customer
within thirty (30) business days of the commencement of the term of the
Agreement to supply support and maintenance to the Customer.
(b) Within thirty (30) days of Changepoint or an Affiliate supplying to
a Customer Updated Software, Changepoint agrees to deposit in escrow with Escrow
Agent the Updated Source Code corresponding to such Updated Software. During the
term of the Agreement, Escrow Agent shall retain the Source Code or Updated
Source Code, as the case may be, for the current and prior release of the
Customer's Software. Other versions of the Source Code and
-3-
Updated Source Code shall be returned to Changepoint by Escrow Agent upon the
written request of Changepoint. In its written request, Changepoint shall
specifically and clearly identify those versions of the Source Code and
Updated Source Code that shall be returned to Changepoint by Escrow Agent.
3. TERM OF AGREEMENT
Unless terminated earlier according to its terms, this
agreement shall remain in full force and effect as between Changepoint and
Escrow Agent from the Effective Date of this agreement until the expiration or
termination of the Agreements. Obligations hereunder with respect to a specific
Customer shall commence on the date the Customer becomes a party to this
agreement by signing the Letter Agreement and delivering same to Changepoint and
Escrow Agent and shall continue unless earlier terminated according to the terms
of this agreement, on the effective date of the termination or expiration of the
Agreement with the Customer. The obligations of Changepoint and Escrow Agent to
any Customer shall also terminate upon delivery to the Customer of a copy of the
Source Code or Updated Source Code according to the provisions of sections 6, 8,
or 9 of this agreement.
4. CHARGES
Changepoint shall pay Escrow Agent's annual fee for services
that are set out in Schedule A attached hereto. These charges are solely for the
storage of the Source Code and Updated Source Code. Any other services provided
by Escrow Agent shall be at then current hourly rates. Customer shall pay the
charges of Escrow Agent pertaining to services provided on behalf of Customer
(other than the storage of the Source Code and Updated Source Code) including
(a) Escrow Agent's fees and actual costs related to any Customer request, (b)
Escrow Agent's fees and actual costs related to validating a claim by Customer
that an Emergency exists, and (c) releasing the Source Code and Updated Source
Code to Customer. In addition to the charges set out, the Customer shall pay all
applicable taxes related to items (a) to (c) above, exclusive of taxes based on
Escrow Agent's net income.
5. APPOINTMENT OF ESCROW AGENT
The parties agree that Escrow Agent is hereby appointed to act
as Escrow Agent for the Customers and to receive the Source Code or Updated
Source Code according to the provisions of this agreement.
6. RELEASE OF SOURCE CODE TO THE CUSTOMER
If the Customer reasonably determines that there is an
Emergency, the Customer shall so notify Changepoint and Escrow Agent in writing
describing the Emergency in detail and making a formal demand that Escrow Agent
release the Source Code or Updated Source Code applicable to the Customer. If
Changepoint disagrees with the Customer that an Emergency exists or continues to
exist, Changepoint shall so notify Escrow Agent and the Customer in writing
within ten business days (10) days after receipt of the Customer's demand for
release of
-4-
the Source Code or Updated Source Code and Escrow Agent shall not release the
Source Code or Updated Source Code except as provided in sections 8 or 9 of
this agreement. Failure of Changepoint to give timely notice objecting to the
release of the Source Code or Updated Source Code shall conclusively
establish its consent to the immediate release of the Source Code or Updated
Source Code to the Customer under the terms of this agreement.
7. INJUNCTIVE RELIEF
Changepoint and the Customer acknowledge and agree that
Changepoint will suffer irreparable harm in the event that the Source Code or
Updated Source Code is wrongly released to the Customer and that Changepoint may
obtain injunctive relief from a court of competent jurisdiction to prevent
Escrow Agent from releasing the Source Code or Updated Source Code
unjustifiably.
8. DISPUTE RESOLUTION
In the event of any dispute under section 6 of this agreement,
senior management of Changepoint and the Customer shall meet no later than seven
(7) business days after service of Changepoint's or the Customer's dispute
notice and shall enter into good faith negotiations aimed at resolving the
dispute in an amicable manner. If they are unable to resolve the dispute in a
mutually satisfactory manner within the next one (1) business day, either
Changepoint or the Customer may submit the matter to binding arbitration under
section 9 of this agreement.
9. ARBITRATION
Upon receipt by Escrow Agent of written notice by Changepoint
or the Customer calling for arbitration as provided for in section 8, the
dispute shall be settled by arbitration pursuant to the provisions of the
Arbitration Act, 1991 (Ontario), as amended from time to time. The arbitration
proceedings shall take place in the Municipality of Metropolitan Toronto
provided that the arbitration panel may, for the convenience of the parties and
without changing the venue of the arbitration proceeding, take evidence outside
of the Municipality of Metropolitan Toronto. In addition to the rules governing
such arbitration, the parties shall have at their disposal the broadest
pre-trial document discovery rights as are then available under the laws and
judicial rules of the Province of Ontario, provided that any dispute between the
parties relating to discovery shall be submitted to the arbitration panel for
resolution. The sole issues for arbitration shall be the matters set out in
section 6. If the arbitrator(s) decide the matter in favour of the Customer, the
arbitrator(s) shall order the Source Code or Updated Source Code to be released
to the Customer forthwith, and may make a determination about costs of the
parties. The arbitrator(s) shall have the power to make interim orders where
necessary. The arbitrator(s) shall establish a procedure to attempt to have all
disputes resolved in an expeditious manner.
10. OBLIGATIONS OF ESCROW AGENT AND THE CUSTOMER UPON TERMINATION
Upon the expiration or termination of an Agreement,
Changepoint may give written notice of such termination or expiration to Escrow
Agent. Following the expiration of
-5-
thirty (30) days from the receipt of such notice by Escrow Agent, Escrow
Agent shall cease to have any obligation to the Customer concerning the
Source Code or Updated Source Code and Escrow Agent shall return same to
Changepoint.
11. INDEMNIFICATION OF ESCROW AGENT
Escrow Agent shall not, because of its signing this agreement,
assume any responsibility or liability for any transaction between Changepoint
and the Customer other than the performance of its obligations according to this
agreement. Except for a breach of the obligations set out in section 12 herein,
in no event shall Escrow Agent be liable to Changepoint, the Customer or to any
other party for consequential or incidental damages. If for any reason (except
for a breach of the obligations set out in section 12 herein), Escrow Agent
shall be found liable to Changepoint, the Customer or to any other party, then
in such event the parties agree that such liability shall not exceed the amounts
paid to Escrow Agent hereunder. The party on whose behalf, or pursuant to whose
direction Escrow Agent acts, shall indemnify and hold harmless Escrow Agent, its
officers and employees from any and all liability, damages, costs or expenses,
including reasonable fees that shall be sustained or incurred by Escrow Agent
because of taking such action.
12. NONDISCLOSURE BY ESCROW AGENT
Escrow Agent recognizes and agrees that Source Code and
Updated Source Code is the valuable proprietary and confidential information of
Changepoint and/or licensors of Changepoint and agrees to hold same in strict
confidence and that it will take all appropriate actions to preserve its
confidentiality. Except as expressly provided for in this agreement, Escrow
Agent agrees that it will not use or disclose, divulge or make available the
Source Code or Updated Source Code to any person, association, firm, partnership
or corporation either directly or indirectly in any manner whatsoever without
the prior written consent of Changepoint.
13. USE AND NONDISCLOSURE BY THE CUSTOMER
(c) The Customer recognizes and agrees that the Source Code and Updated
Source Code is the valuable proprietary and confidential information of
Changepoint. The Customer agrees to hold same in the strictest of confidence and
to preserve its confidentiality in the event that it obtains same from Escrow
Agent pursuant to this agreement. In the event that an Emergency condition has
occurred and the Customer has received the Source Code or the Updated Source
Code from Escrow Agent pursuant to the provisions hereof, the Customer shall
have and Changepoint hereby grants to the Customer a non-exclusive
non-transferable license to use the Source Code or Updated Source Code solely
for the purpose of correcting Changepoint Defaults and, in the case the release
of the Source Code to the Customer was as a result of an Emergency condition
described in clause A or B of the definition of Emergency, to correct other
programming errors that result in the Software not operating in the manner
described in the user documentation provided by Changepoint to the Customer for
as long as such Emergency condition continues to exist. No other use of the
Source Code or Updated Source Code
-6-
whatsoever may be made by Customer. The Customer agrees not to disclose or
provide access to the Source Code or Updated Source Code to any third party
except in confidence to its employees and contractors approved in writing by
Changepoint requiring such information for the purposes herein. Changepoint
agrees not to unreasonably refuse or delay the approval of a contractor
proposed by the Customer and Changepoint shall notify the Customer of its
approval or non-approval within seven (7) business days of receipt of a
written request from the Customer for an approval. A contractor will be
deemed approved by Changepoint in the event Changepoint fails to respond to a
Customer request for approval within the seven (7) business day period, or if
the release of the Source Code was as a result of an Emergency condition
described in clause A or B of the definition of Emergency. Customer will
instruct such employees and contractors in writing to keep such material and
information confidential. Customer shall be responsible to Changepoint for
any failure by employees and contractors to maintain such material and
information in confidence. Customer will promptly notify Changepoint of the
existence of any circumstances surrounding any unauthorized possession or use
of any such confidential information and material of which it becomes aware.
In the event that the Source Code, or Updated Source Code, as the case may
be, is released pursuant to the Emergency described in clause 1.C, the Source
Code or Updated Source Code, as the case may be, shall be returned to Escrow
Agent with notice to Changepoint after Customer has corrected the Changepoint
Defaults described in the written notice referred to in clause 1.C.
(d) The parties agree that Changepoint would have no adequate remedy at
law upon the Customer's threatened or actual breach of its obligations under the
terms of this agreement and accordingly agree that, in addition to such monetary
relief as may be recoverable by law, Changepoint may apply to a court of
competent jurisdiction for an injunction restraining any such threatened or
actual breach without showing or proving any actual damages sustained by
Changepoint. Changepoint shall be entitled to terminate the Customer's license
to use the Source Code and Updated Source Code in Section 13(a) by written
notice to the Customer in the event the Customer breaches any of its obligations
in Section 13(a) or uses such software for any unauthorized purpose. On any such
termination the Customer shall immediately stop using such software and shall
forthwith return and/or destroy all copies thereof and certify in writing to
Changepoint that it has done so within five (5) days of the termination.
14. TERMINATION BY ESCROW AGENT
This agreement may be terminated by Escrow Agent by giving at
least ninety (90) days written notice to Changepoint and the Customer. In that
event, Changepoint shall appoint and Customer hereby consents to the appointment
of a new escrow agent on terms substantially the same as those contained herein
subject to such modifications as the new escrow agent shall require and that
shall be reasonably acceptable to Changepoint.
15. LIABILITIES OF ESCROW AGENT
(a) Escrow Agent will not have any responsibility or liability with
respect to any transactions between Changepoint and Customers other than its
obligation to deliver copies of the Source Code and Updated Source Code, as the
case may be, held by it in accordance with the
-7-
terms of this agreement. Escrow Agent will not be responsible for the truth
of any matter represented or stated in any affidavit or communication.
(b) Escrow Agent is not a party to, or is not bound by, any provisions
which may be evidenced by, or arise out of, any agreement other than as herein
set forth under the express provisions of this agreement.
(c) Escrow Agent acts hereunder as a depository only and is not
responsible or liable in any manner whatever for the efficiency, correctness,
genuineness or validity of any Source Code or Updated Source Code deposited with
it, or for the form or execution of such instrument, or for the identity or
authority or right of any person or party executing or depositing it.
(d) Escrow Agent may act upon any written notice, request, waiver,
consent, receipt or other paper or document apparently signed by the proper
person or party, unless Escrow Agent knows or has reason to believe that such
notice, request, waiver, consent, receipt, or other paper or document, as the
case may be, was not signed by the proper person or party.
(e) Escrow Agent may seek the advice of legal counsel in the event of
any question or dispute as to the construction of any of the provisions hereof
or its duties hereunder, and it shall incur no liability in acting in accordance
with the opinion and instructions of such counsel, unless such action involves a
breach of this agreement.
(f) Escrow Agent shall not be liable for any error of judgement, or for
any act done or omitted by it in good faith, or for any mistake of fact or law,
or for anything which it may do or omit from doing in connection herewith,
except its own wilful misconduct or breach of this agreement.
(g) None of the provisions contained in this agreement shall require
Escrow Agent to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers unless Escrow Agent is indemnified by the person for whom
Escrow Agent is asked to act against the costs, charges and expenses and
liabilities to be incurred thereby and any loss and damage it may suffer by
reason thereof.
16. APPROVAL OF CUSTOMER BY ESCROW AGENT
Within ten (10) business days of the receipt of the Letter
Agreement from a prospective Customer, Escrow Agent shall approve of the
prospective Customer by countersigning the Letter Agreement and sending same to
prospective Customer and Changepoint or shall disapprove of a prospective
Customer by providing notice of such disapproval to both the prospective
Customer and Changepoint. Escrow Agent shall not withhold its approval of a
prospective Customer pursuant to the Letter Agreement unless Escrow Agent
determines, after acting reasonably and after consultation of the prospective
Customer, that prospective Customer does not have sufficient resources to meet
its obligations under section 11 of this agreement.
-8-
17. ASSIGNMENT
Except as otherwise provided herein, no party may assign this
agreement without the prior written consent of the other parties. Changepoint
may assign this agreement in connection with the sale of all or substantially
all of its business or the merger, amalgamation, or other corporate
reorganization of Changepoint provided that Escrow Agent is notified thereof and
the assignee hereof agrees to perform and assume the obligations of Changepoint
hereunder.
18. SURVIVAL
It is agreed that the provisions of sections 10, 11, 12 and 13
shall remain in force and effect after the termination hereof until such time as
the parties may mutually agree to the release of the obligations contained
therein.
19. SEVERABILITY
If any term, provision, covenant or condition of this
agreement is held by a court of competent jurisdiction to be invalid or
unenforceable, the remainder of the provisions shall remain in full force and
effect and shall not be affected, impaired or invalidated thereby.
20. WAIVER
Except as otherwise provided herein, no term or provision
hereof shall be deemed waived and no breach excused unless such waiver or
consent shall be in writing and signed by the party claimed to have waived or
consented. Any consent by any party to, or waiver of, a breach by the other,
whether expressed or implied, shall not constitute a consent to, waiver of, or
excuse for any other different or subsequent breach.
21. NOTICE
Any notice, request, demand, consent or other communication
provided or permitted hereunder shall be in writing and given by personal
delivery, transmitted by facsimile or sent by special delivery mail, postage
prepaid, addressed to the party for which it is intended at its address as set
out above or as may be designated by notice pursuant hereto addressed to the
President in the case of Changepoint, to the President (or other similar
employee, officer or director of Customer designated by the Customer and
disclosed to Changepoint and Escrow Agent in the case of the Customer), and to
the employee, officer or director of Montreal Trust Company of Canada referred
to in the Letter Agreement in the case of Escrow Agent. Any party may change its
address for purposes of transmittal or receipt of any such communication by
giving ten (10) days' prior written notice of such change to the other parties
in the manner prescribed above. Any notice so given shall be deemed to have been
received on the date on which it was delivered or transmitted by facsimile or if
mailed, on the third day following the mailing thereof.
-9-
22. GOVERNING LAW
This agreement shall be governed by, subject to and
interpreted in accordance with the laws in force in the Province of Ontario.
23. ENTIRE AGREEMENT
This agreement including the attached schedules contains the
entire agreement between the parties with respect to the subject matter thereof
as of its date and supersedes all other prior agreements, negotiations, written
or oral, relating to its subject matter.
IN WITNESS WHEREOF the parties have executed this agreement as
of the date first written above.
CHANGEPOINT CORPORATION MONTREAL TRUST COMPANY
OF CANADA
By: ___________________________ By: _______________________________
Name: _________________________ Name: _____________________________
Title: ________________________ Title: ____________________________
By: _______________________________
Name: _____________________________
Title: ____________________________
SCHEDULE A
Annual Fee CDN $500.00
SCHEDULE B
[TO BE PLACED ON CHANGEPOINT LETTERHEAD]
(Date)
Softrax Corporation
00 Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxxxxx
00000
X.X.X.
Dear Sirs:
RE: ESCROW OF SOURCE CODE FOR CHANGEPOINT CORPORATION (THE -SOFTWARE-)
In response to your request for the escrow of the source code
to the Software, we wish to inform you that Changepoint has established a Master
Source Code Escrow Agreement (the "Escrow Agreement") which is generally
available to customers of Changepoint and affiliates of Changepoint.
Attached to this letter (the "Letter Agreement") is a copy of
the Escrow Agreement for your files. Please sign, date and return a copy of the
Letter Agreement both to my attention and to the attention of Xxxx Xxxxxx at
Montreal Trust Company of Canada.
Prior to deposit of the escrowed materials with the Escrow
Agent, you may request verification that Changepoint's source code of the
Software is executable on the appropriate computer, is capable of compiling the
object code of the Software licensed to you and that when so compiled performs
consistent with the latest version of the Software delivered to you by
Changepoint pursuant to the Licence Agreement to which we are both parties (the
"Conditions"). Should you wish such verification, you must send written notice
of such a request to Changepoint specifying:
(a) the date and time (on normal business days and during normal
business hours) when you wish the verification to be
conducted; and
(b) whether you prefer the verification to take place at your or
Changepoint's premises.
At the date, time and location specified in the notice, or (if either party is
unable to attend at the specified date and time) at such other time as we may
both agree, Changepoint will perform such series of tasks and verification
procedures as you may require to enable you to determine that the source code
satisfies the Conditions. Changepoint will ensure that the source code is erased
from any computer at your premises and you agree to permit Changepoint to
perform such tasks and procedures necessary to confirm that the source code has
been fully removed. Upon completion of the verification, you may designate a
person to accompany Changepoint to deliver the escrowed materials to the Escrow
Agent. If during the verification the escrowed materials do not
-2-
satisfy the Conditions, Changepoint will take all necessary measures to
ensure that the escrowed materials are updated with new or corrected
materials so that the source code does satisfy the Conditions within thirty
(30) days after the conclusion of the initial verification. You will pay any
costs or expenses on a time and materials basis incurred in connection with
any verification of the escrowed materials.
Changepoint and you agree that upon receipt by you of any of
the escrowed materials you will have a personal, non-exclusive, non-transferable
and non-assignable license to use them solely at 00 Xxxxxxx Xxxx, Xxxxxx,
Xxxxxxxxxxxxx, 00000, U.S.A., on a single, non-networked, micro-computer or
workstation solely for the purposes set out in, and subject to the terms and
conditions of, section 13(a) of the Escrow Agreement. Changepoint will have the
right to terminate the license conferred by this paragraph and to require you to
return any escrowed materials delivered to you in the event you breach the terms
of this paragraph or use the escrowed materials in a manner not authorized in
this paragraph.
Once Escrow Agent receives a signed copy of this Letter
Agreement and approves of you as a Customer by countersigning the Letter
Agreement and returning it to both you and Changepoint, you will then become a
party to the Escrow Agreement and Escrow Agent shall add your company's name to
the list of escrow customers. Changepoint will send a copy of the Software in
your name to Montreal Trust Company of Canada or will designate a copy sent to
be retained in your name for safekeeping as described in the Escrow Agreement.
In the event that Escrow Agent disapproves of you as a Customer, notice will be
provided to you and Changepoint in accordance with section 16 of the Escrow
Agreement.
This Letter Agreement shall become effective on the date it is
signed by both yourself and Escrow Agent and thereafter returned to both you and
Changepoint.
Yours truly,
Changepoint Corporation
Agreed to by:
SOFTRAX CORPORATION
Name of Customer
______________________________
Signature
______________________________
Print Name
______________________________
-3-
Title
00 Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxxxxx
00000
X.X.X.
MONTREAL TRUST COMPANY OF CANADA
By: ___________________________________
Name: _________________________________
Title: ________________________________
SCHEDULE G
CHANGEPOINT LICENSE
CHANGEPOINT SOFTWARE
LICENSE AND MAINTENANCE AGREEMENT (U.S.A. SS)
Between: and:
CHANGEPOINT INC.
0000 Xxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxx Xxxx, Xxxxxxx
Xxxxxx
X0X 0X0
(hereinafter referred to as "Changepoint") (hereinafter referred to as
"Customer")
Contract No. _______________
This Agreement sets out the terms pursuant to which Customer may use the
Licensed Materials (as that term is hereinafter defined). This Agreement also
sets out the terms pursuant to which Changepoint will provide Implementation
Services and Maintenance Services to Customer.
The "CHANGEPOINT Software License and Maintenance Agreement - Terms and
Conditions" on the following pages of this document and the attached Appendix A
form an integral part of this Agreement. These documents constitute the entire
agreement between the parties hereto with respect to the subject matter hereof
and cancels and supersedes any prior understandings and agreements between the
parties hereto with respect thereto. There are no provisions, representations,
undertakings, agreements, or collateral agreements between the parties other
than as set out herein in this Agreement.
The parties by their authorized representatives and intending to be legally
bound have entered into this Agreement as of the ___ day of _____, 1999 (the
"Effective Date").
CHANGEPOINT INC.
Signature _________________________ Signature _________________________
Name ______________________________ Name ______________________________
Title _____________________________ Title _____________________________
-5-
CHANGEPOINT SOFTWARE
LICENSE AND MAINTENANCE AGREEMENT -
TERMS AND CONDITIONS
ARTICLE 1 - INTERPRETATION
1.1 DEFINITIONS
In this Agreement and in Appendix A the following terms shall have the
respective meanings ascribed to them as follows:
"AFFILIATE" means with respect to any person, any other person directly
or indirectly controlling, controlled by, or under common control of
such person. "Control" as used here means the legal, beneficial or
equitable ownership, directly or indirectly, of more than 50% of the
aggregate of all voting interests in such entity.
"BUSINESS DAYS" means Monday through Friday excluding any day which is
a nationally observed holiday in both the United States of America and
Canada.
"BUSINESS HOURS" means 8:00 a.m. - 7:00 p.m. Eastern Time on Business
Days.
"CLIENT ACCESS LICENSE" means a Software License which authorizes
Customer to install a Component of the Licensed Software on a single
client device (e.g. - computer workstation).
"COMPONENTS" mean the components of the CHANGEPOINT Software referred
to in Appendix A.
"CONFIDENTIAL INFORMATION" means (i) all information of either party or
its affiliates or of third persons to whom a party owes a duty of
confidence that is marked confidential, restricted or proprietary or
that may reasonably be considered as confidential from its nature or
from the circumstances surrounding its disclosure; and (ii) the
Licensed Materials.
"DOCUMENTATION" means in relation to the Licensed Software, the user
documentation made generally available by Changepoint to customers
which have been granted a license from Changepoint to use the Licensed
Software.
"INSTALLATION FEES" has the meaning given to it in Section 4.2.
"INSTALLATION SERVICES" has the meaning given to it in Section 3.2.
"INTELLECTUAL PROPERTY RIGHTS" includes all worldwide intellectual and
industrial property rights including all rights in each country to
copyrights, trademarks, service marks, patents, inventions, industrial
designs, trade secrets, trade dress and all other proprietary rights.
"LICENSE" means Customer's license to use the Licensed Materials
described in Article 2 and in Appendix A.
"LICENSE FEES" means the license fees to be paid by Customer to
Changepoint which are described in Section 4.1.
"LICENSED MATERIALS" means the Licensed Software and Documentation and
includes Maintenance Releases and Enable Codes which Changepoint may
from time to time provide to Customer hereunder.
"LICENSED SOFTWARE" means the Components of the CHANGEPOINT Software in
object code format licensed to Customer hereunder and described in
Appendix A and such additional Components of the CHANGEPOINT Software
which Customer and Changepoint hereinafter agree shall be added to
Appendix A.
"MAINTENANCE" has the meaning given to it in Section 4.2.
"MAINTENANCE FEES" has the meaning given to it in Section 4.2.
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"MAINTENANCE RELEASE" means new versions and releases of the Licensed
Software which Changepoint makes generally available to its customers
who have contracted with it to receive Maintenance Service for the
Licensed Software.
"MAINTENANCE SERVICES" means the services described in Section 7.2.
"SOFTWARE LICENSES" means the utilization licenses and associated
restrictions with respect to the Licensed Software granted to Customer
hereunder which are set forth in Appendix A.
"WARRANTY PERIOD" means the period as set out in Appendix A.
"WARRANTY SUPPORT" means the warranty support set forth in Section
6.1(a).
ARTICLE 2 - LICENSE
2.1 LICENSE
(a) Subject to the provisions of this Agreement including the provisions of
Article 8, Changepoint hereby grants to Customer and Customer hereby accepts
from Changepoint the perpetual, personal, non-transferable and non-exclusive
Software Licenses to use the Licensed Software for Customer's internal business
purposes. Customer may also make a reasonable number of back-up copies, but not
to exceed two (2) copies, of the Licensed Software for use as part of Customer's
disaster recovery plan.
(b) The Licensed Materials may be used only as set out in this Agreement
and Customer agrees not to make any copies (whether in electronic or any other
form) or use thereof other than as expressly permitted herein or by Changepoint
in writing in advance, even if it is technically feasible to do so. Without
limiting the generality of the foregoing, Customer agrees to use the Licensed
Software only to the extent authorized by the Software Licenses. (c) Customer's
License to use the Licensed Materials shall commence on the Effective Date.
2.2 DOCUMENTATION
The Documentation may be used by Customer at Customer sites for the
purpose of assisting Customer in using the Licensed Software for the internal
business purposes of Customer. Changepoint agrees to deliver one copy of the
Documentation to Customer in either printed or electronic form. Documentation
provided in machine readable form may be printed and used solely for the
internal business purposes of Customer. No other reproduction or use of the
Documentation is permitted.
2.3 THIRD PARTY USERS
For the purpose of operating Customer's business, the parties intend
that certain unrelated third parties with whom Customer has a business
relationship such as a supplier or customer and the employees of such third
person (hereunder "Business Third Parties"), will have limited right to use
certain Components of the Licensed Software solely for the purpose of providing
services to Customer. All such persons must execute an agreement in writing with
Customer to maintain the Confidential Information in confidence and to use the
Licensed Materials only as permitted. Customer agrees to strictly enforce the
provisions of such non-disclosure agreements set forth in this Section 2.3 and
all other provisions of this Agreement as applicable to any and all uses of the
Licensed Materials.
ARTICLE 3 - DELIVERY AND INSTALLATION
3.1 DELIVERY OF LICENSED MATERIALS
Changepoint agrees to deliver to Customer one (1) copy of the most
current release and version of the Licensed Materials. The Documentation will be
provided solely in the English language.
3.2 INSTALLATION SERVICES
Changepoint agrees to provide the installation services (the
"Installation Services") described in Appendix A.
3.3 ENABLE CODES
To enable Customer to install the Licensed Software, Changepoint will
provide Customer with information or data which are intended to enable the
Licensed Software to be used ( the "Enable Codes"). The Enable Codes are
designed to enable Customer to use the Licensed Software in accordance with the
number of Software Licenses acquired hereunder. Customer acknowledges and agrees
that additional Enable Codes will need to be obtained from Changepoint if
Customer acquires one or more additional Software Licenses from Changepoint.
Customer agrees not to, and shall cause all users not to, modify, adapt or
create derivative works of any Enable Codes provided, develop or have developed
any Enable Codes, or use any Enable Codes other than those provided by
Changepoint.
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ARTICLE 4 - PRICE AND PAYMENT TERMS
4.1 LICENSE FEES
Customer shall pay to Changepoint the license fees described in
Appendix A (the "License Fees"). The License Fees shall be due and paid as
provided for in Appendix A.
4.2 MAINTENANCE AND INSTALLATION FEES
Customer agrees to pay to Changepoint the Maintenance Fees and the
Installation Fees set out in Appendix A.
4.3 TAXES AND INTEREST
(a) Customer shall pay (and Changepoint shall have no liability for), any
taxes, tariffs, duties and other charges or assessments imposed or levied by any
government or governmental agency in connection with this Agreement, including,
without limitation, any federal, provincial, state and local sales, use, goods
and services, value-added and personal property taxes on any payments due
Changepoint in connection with the Licensed Materials and/or Maintenance
Services and other services provided hereunder, excluding only income taxes
payable by Changepoint.
(b) All overdue payments shall bear interest at a rate
of 12% per annum on the amounts outstanding from the time such amounts become
due until payment is received by Changepoint.
ARTICLE 5 - PROPRIETARY RIGHTS AND CONFIDENTIAL INFORMATION
5.1 TITLE TO LICENSED MATERIALS
Customer acknowledges and agrees that Changepoint or licensors of
Changepoint shall retain all right, title and interest in and to the Licensed
Materials and all copies thereof, including, without limitation, the
Intellectual Property Rights therein, and that nothing herein transfers or
conveys to Customer any ownership right, title or interest in or to the Licensed
Materials or to any copy thereof or any license right with respect to same not
expressly granted herein, including, without limitation, with respect to the
Intellectual Property Rights therein.
5.2 CONFIDENTIAL INFORMATION
(a) Each party agrees to maintain the confidentiality of the Confidential
Information of the other party and to use same only as expressly authorized
herein. Each party shall safeguard and maintain the other party's Confidential
Information in strict confidence and shall not disclose, provide, or make the
Confidential Information or any part thereof available in any form or medium to
any person except to such party's employees, and to contractors and consultants
of such party who have executed an agreement in writing to protect such
Confidential Information and who have a need to access such Confidential
Information hereunder.
(b) The provisions of Section 5.2(a) shall not apply to any information
which: (i) was at the time of disclosure to a party, in the public domain, (ii)
after disclosure to a party becomes part of the public domain through no fault
of the receiving party, (iii) was in the possession of the receiving party prior
to the time of disclosure to it without any obligation of confidence or any
breach of confidence, (iv) was received after disclosure to a party from a third
party who had a lawful right to disclose such information to it, (v) was
independently developed by a party without reference to the confidential
information of the other party or (vi) was ordered to be disclosed by a court,
administrative agency, or other governmental body with jurisdiction over the
parties hereto, provided that the ordered party will first have provided the
disclosing party with prompt written notice of such required disclosure and will
take reasonable steps to allow the disclosing party to seek a protective order
with respect to the confidentiality of the information required to be disclosed.
Further, the ordered party will promptly cooperate with and assist the
disclosing party in connection with obtaining such protective order.
5.3 PROTECTION OF PROPRIETARY RIGHTS
(a) Customer shall not remove any proprietary, copyright, patent, trade
xxxx, design right, trade secret, or any other proprietary rights legends from
the Licensed Materials.
(b) Customer agrees not to disassemble, decompile, translate or convert
into human readable form or into another computer language, reconstruct or
decrypt, or reverse engineer, all or any part of the Licensed Materials in
accordance with law. Further, Customer shall not write or develop any derivative
works or computer programs based upon any part of the Licensed Materials.
5.4 EXPORT OF SOFTWARE
Customer will not export or re-export the Licensed Materials or any
copies thereof, either directly or indirectly, outside of the country in which
such materials are delivered to Customer except in compliance with all
applicable laws, ordinances and regulations. Customer shall have the exclusive
obligation to ensure that any export of the Licensed Materials is in compliance
with all applicable export laws and the laws of any foreign country.
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ARTICLE 6 - WARRANTIES OF CHANGEPOINT
6.1 WARRANTY AND DISCLAIMERS
(a) Changepoint warrants that during the Warranty Period: (i) the Licensed
Software will conform substantially to the description thereof in the
Documentation, and (ii) the media upon which the Licensed Software and
Documentation are provided will be free from defects in materials and
workmanship.
(b) Changepoint warrants that the Licensed Software shall be able to
accurately process date data (including but not limited to, calculating,
comparing, and sequencing) from, into and between the 00xx xxx 00xx xxxxxxx (xxx
"X0X Xxxxxxxx"). However, such warranty does not apply to any failures to
process date data that result from any software other than the Licensed Software
or hardware or which relate to accepting data from any system not supplied by
Changepoint. For greater clarity the Y2K Warranty shall only apply if Customer
uses the Software in accordance with the Documentation.
(c) Customer's exclusive remedy and Changepoint's sole obligation with
respect to the breach of any of the foregoing warranties is for Changepoint to
(i) make commercially reasonable efforts to correct or provide Customer with a
workaround for the failure of the Licensed Software to conform substantially to
the description thereof in the Documentation or to comply with the Y2K Warranty,
as the case may be, or, at Changepoint's sole option, provide Customer with a
refund for the License Fees paid with respect to such Licensed Software, and
(ii) provide Customer with replacement media in the event there are defects in
materials or workmanship in the media upon which the Licensed Software and
Documentation are provided if the media is returned to Changepoint within the
Warranty Period.
(d) OTHER THAN THE WARRANTIES EXPRESSLY SET FORTH IN SECTION 6.1(A) AND
6.1(B), CHANGEPOINT EXPRESSLY DISCLAIMS ANY AND ALL REPRESENTATIONS, WARRANTIES
AND CONDITIONS OF ANY KIND OR NATURE, EXPRESS OR IMPLIED, INCLUDING WITHOUT
LIMITATION, REPRESENTATIONS, WARRANTIES AND CONDITIONS OF QUALITY, PERFORMANCE,
RESULTS, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, AND THOSE
ARISING BY STATUTE OR OTHERWISE IN LAW OR FROM A COURSE OF DEALING OR USE OF
TRADE. CHANGEPOINT DOES NOT REPRESENT OR WARRANT THAT (I) THE LICENSED MATERIALS
WILL MEET CUSTOMER'S BUSINESS REQUIREMENTS, (II) THE OPERATION OF THE LICENSED
SOFTWARE WILL BE ERROR-FREE OR UNINTERRUPTED OR (III) THAT ALL PROGRAMMING
ERRORS CAN BE CORRECTED.
(e) Customer is responsible for taking precautionary measures to prevent
the loss or destruction of customer data and databases such as, for example,
making regular backups and verifying the results obtained from using the
Licensed Materials, and Changepoint shall have no obligations or liability
whatsoever with respect to any such loss or destruction.
6.2 LIMIT OF LIABILITY
(a) FOR ANY BREACH OR DEFAULT BY CHANGEPOINT OF ANY OF THE PROVISIONS OF
THIS AGREEMENT, OR WITH RESPECT TO ANY CLAIM ARISING HEREFROM OR RELATED HERETO,
EXCEPT FOR ANY CLAIM FOR BREACH OF SECTION 5.2 (UNAUTHORIZED DISCLOSURE OF
CONFIDENTIAL INFORMATION), OR FOR BREACH OF SECTION 6.4(A) (INTELLECTUAL
PROPERTY INDEMNITY), CHANGEPOINT'S ENTIRE LIABILITY, REGARDLESS OF THE FORM OF
ACTION, WHETHER BASED ON CONTRACT OR TORT, INCLUDING NEGLIGENCE, SHALL IN NO
EVENT EXCEED (I) THE AMOUNT PAID BY CUSTOMER HEREUNDER FOR THE LICENSED
MATERIALS, (II) THE AMOUNT PAID BY CUSTOMER FOR THE MAINTENANCE SERVICE THAT IS
THE SUBJECT OF THE CLAIM IF THE CLAIM RELATES TO A BREACH OR DEFAULT BY
CHANGEPOINT OF THE PROVISIONS OF ARTICLE 7, (III) THE AMOUNT PAID BY CUSTOMER
FOR THE INSTALLATION SERVICE THAT IS THE SUBJECT OF THE CLAIM IF THE CLAIM
RELATES TO A BREACH OR DEFAULT BY CHANGEPOINT OF THE PROVISIONS OF THIS
AGREEMENT PERTAINING TO INSTALLATION SERVICE, OR (IV) IN THE AGGREGATE WITH
RESPECT TO ALL CLAIMS UNDER OR RELATED TO THIS AGREEMENT, THE AMOUNT PAID BY
CUSTOMER UNDER THIS AGREEMENT.
(b) IN NO EVENT WILL CHANGEPOINT BE LIABLE FOR SPECIAL, INCIDENTAL,
INDIRECT, OR CONSEQUENTIAL LOSS OR DAMAGE, LOST BUSINESS REVENUE, LOSS OF
PROFITS, LOSS OF DATA, FAILURE TO REALIZE EXPECTED PROFITS OR SAVINGS OR ANY
CLAIM AGAINST CUSTOMER BY ANY OTHER PERSON (EVEN IF CHANGEPOINT HAS BEEN ADVISED
OF THE POSSIBILITY OF ANY SUCH LOSS OR DAMAGE).
(c) CHANGEPOINT SHALL BE LIABLE TO CUSTOMER AS EXPRESSLY PROVIDED IN THIS
AGREEMENT BUT SHALL HAVE NO OTHER OBLIGATION, DUTY, OR LIABILITY WHATSOEVER IN
CONTRACT, TORT OR OTHERWISE TO CUSTOMER INCLUDING ANY LIABILITY FOR NEGLIGENCE.
THE LIMITATIONS, EXCLUSIONS AND DISCLAIMERS IN THIS AGREEMENT SHALL APPLY
IRRESPECTIVE OF THE NATURE OF THE CAUSE OF ACTION, DEMAND, OR ACTION BY
CUSTOMER, INCLUDING BUT NOT LIMITED TO BREACH OF CONTRACT, NEGLIGENCE, TORT, OR
ANY OTHER LEGAL THEORY AND SHALL
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SURVIVE A FUNDAMENTAL BREACH OR BREACHES OR THE FAILURE OF THE ESSENTIAL
PURPOSE OF THIS AGREEMENT OR OF ANY REMEDY CONTAINED HEREIN.
6.3 LIMITATION PERIOD
Neither party may bring an action, regardless of form, arising out of
or related to this Agreement (other than to recover License Fees or Maintenance
Fees) more than two (2) years after the cause of action has arisen or the date
of discovery of such cause, whichever is later.
6.4 INTELLECTUAL PROPERTY CLAIMS
(a) Changepoint will defend or (at its option) settle, any claim or action
brought against Customer to the extent that it is based on a claim that the
Licensed Materials infringe any copyright, patent, trade secret or trademark
enforceable in the United States of America of any third person (an
"Infringement Claim") and will indemnify Customer against damages and costs
awarded against Customer by a court of competent jurisdiction by final order
from which no appeal is taken or the time for appealing has expired, provided
that Customer notifies Changepoint promptly in writing of same, and provided
further that Customer permits Changepoint to control the litigation and to
defend, compromise or settle the claim and provides all available information,
assistance and authority to enable Changepoint to do so. Changepoint shall not
be liable to reimburse Customer for any compromise or settlement made by
Customer without Changepoint's prior written consent, or for any legal fees or
expenses incurred by Customer in connection with such claim. Customer shall have
no authority to settle any claim on behalf of Changepoint.
(b) Should the Licensed Materials or any of them become, or in
Changepoint's sole opinion be likely to become, the subject of a claim of
infringement, misappropriation, or violation of an Intellectual Property Right
(an "Infringement Claim") Changepoint may (i) procure for Customer, at no cost
to Customer the right to continue to use the Licensed Materials which are the
subject of the Infringement Claim (ii) replace or modify the Licensed Materials
or part thereof subject to such Infringement Claim with software or
documentation of at least comparable functionality, at no cost to Customer, or
(iii) if neither of the forgoing alternatives are reasonably practical in
Changepoint's sole judgement, remove the component that is the subject of the
Infringement Claim or any or all other parts of the Licensed Materials and
refund to Customer the License Fees paid by Customer for the part removed as
depreciated on a straight line five (5) year basis from the date of delivery of
the part to Customer.
(c) Notwithstanding the foregoing, Changepoint shall have
no liability for any claim that is based on (i) the use of other than the latest
release and version of the Licensed Materials, if such infringement could have
been avoided by the use of the latest version and release and such version or
release had been made available to Customer, (ii) the use or combination of the
Licensed Materials with software, hardware or any other product not provided by
Changepoint, or (iii) any modification to the Licensed Materials or use of the
Licensed Materials other than as expressly authorized herein or as expressly
described or recommended in writing by Changepoint.
(d) This Section 6.4 states the entire liability of Changepoint and
Customer's sole remedies with respect to any Infringement Claim.
ARTICLE 7 - MAINTENANCE AND ENHANCED MAINTENANCE SERVICE
7.1 TERM
(a) Following the expiry of the Warranty Period, Changepoint shall provide
Customer with Maintenance Services during successive annual maintenance terms
(each such term is referred to here as a "Maintenance Term") provided that
Customer pays to Changepoint the Maintenance Fees for each Maintenance Term as
and when due hereunder.
(b) Customer or Changepoint may terminate Maintenance Services at the end
of a Maintenance Term by providing the other with no less than thirty (30) days
prior written notice before the end of the Maintenance Term.
7.2 MAINTENANCE SERVICE
(a) During the Warranty Period and each Maintenance Term, Changepoint will
provide Maintenance Releases to Customer. Changepoint will also during Business
Hours provide telephone assistance to Customer with respect to initial error
diagnosis and support regarding the functionality of the Licensed Software.
Maintenance Service shall be provided by Changepoint to up to three (3) customer
support staff who are trained and knowledgeable in the use of the Licensed
Materials and who have been designated from time to time by Customer to request
and receive such service.
(b) As part of Maintenance Service and Warranty Support, Customer will have
access to Changepoint's CHANGEPOINT Knowledge Base technical database which
contains technical information concerning the use of the Licensed Software.
Customer acknowledges that information in this database may not have been
verified by Changepoint. Accordingly, Changepoint shall have no responsibility
hereunder with respect to any inaccurate or incomplete information contained in
the CHANGEPOINT Knowledge Base or the use thereof by Customer.
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7.3 SERVICES NOT INCLUDED
(a) Maintenance Services and Warranty Support does not include or apply to
any of the following: (i) making modifications to the Licensed Materials for
Customer, (ii) user training, (iii) consultation for new programs or equipment,
(iv) hardware problems including any malfunction of hardware, or to any external
causes affecting the Licensed Materials including the media upon which the
Licensed Materials are provided such as accident, disaster, electrostatic
discharge, fire, flood, lightning, water or wind, or (v) correction of errors
attributable to software other than the Licensed Software. Changepoint may
charge Customer at its then applicable list price for providing such services.
Changepoint may also charge Customer at its then applicable list price for
analysis or removal of errors which are caused by improper operation or handling
of the Licensed Materials or caused by circumstances unrelated to Changepoint.
Payment for these services shall be made by Customer within 30 days of invoicing
by Changepoint.
(b) The obligation to provide Maintenance Services is subject to the
following: (i) Maintenance Services are only provided for the Licensed Software
provided under this Agreement, (ii) if Customer ceases to pay for and receive
Maintenance Services and later requests Maintenance Services, Customer will be
required to pay to Changepoint the Maintenance Fees not paid during the period
in which the service was discontinued, and (iii) Maintenance Services need not
be provided by Changepoint if Customer is not using the most current or an
immediately previous release of the Licensed Materials, or if Customer has made
any modifications to the Licensed Materials and (iv) Changepoint has no
obligation to provide Customer with any Maintenance Services unless Customer has
paid for the Maintenance Services in advance as required hereunder.
ARTICLE 8 - TERM AND TERMINATION
8.1 TERM
This Agreement shall be effective on the Effective Date and shall
terminate in accordance with this Article.
8.2 TERMINATION
Either party may by notice in writing terminate this Agreement if (i)
the other party breaches or fails to observe or perform any of its obligations
set out in this Agreement, including failure to pay any License Fees due and
owing, and fails to cure such breach or failure within thirty (30) days after
written notice; or (ii) either party becomes insolvent, or makes an assignment
for the general benefit of creditors, or any proceedings are commenced by or
against either party under any bankruptcy or insolvency laws or if proceedings
for the appointment of a trustee, custodian, receiver, or receiver manager for
either party are commenced, or if either party ceases or threatens to cease to
carry on business.
8.3 RETURNING LICENSED MATERIALS
Within fifteen (15) days after termination or expiration of this
Agreement for any reason, Customer shall return to Changepoint the original and
all copies of the Licensed Materials in the possession or control of Customer
(including any copies in the possession or control of Business Third Parties or
other Users) and shall certify to Changepoint in writing that all such copies
have been so returned and/or deleted from all computer records. Customer shall
also cease to use the Licensed Materials and ensure that all Business Third
Parties to whom Customer has given access to the Licensed Software also cease to
use the Licensed Materials.
8.4 SURVIVAL
The parties hereto agree that the provisions of Sections 3.3 (the last
sentence), 4.3, 6.2, 6.3 and 8.3, 9.9 and 9.10 and Article 5 shall survive and
remain in full force and effect after the termination of the License or this
Agreement for any reason.
ARTICLE 9 - GENERAL
9.1 HEADINGS
The division of this Agreement into Articles and Sections and the
insertion of headings are for convenience of reference only and shall not affect
the construction or interpretation of the Agreement, as the case may be. The
terms "this Agreement", "hereof", "hereunder" and similar expressions in this
Agreement refer to this Agreement and not to any particular Article, Section or
other portion and include any Agreement supplemental hereto. Unless something in
the subject matter or context is inconsistent therewith, references herein to
Articles and Sections are to Articles and Sections of this Agreement.
9.2 EXTENDED MEANINGS
In this Agreement words importing the singular number only shall
include the plural and VICE VERSA, and words importing persons shall include
individuals, partnerships, associations, trusts, unincorporated organizations
and corporations. The terms "provision" and "provisions" in this Agreement refer
to terms, conditions, provisions, covenants, obligations, undertakings,
warranties and representations in this Agreement.
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9.3 NOTICES
For the purposes of this Agreement, and for all notices and
correspondence hereunder, the addresses of the respective parties have been set
out at the beginning of this Agreement and no change of address shall be binding
upon the other party hereto until written notice thereof is received by such
party at the address shown herein. All notices shall be effective upon receipt
if delivered personally or sent by facsimile and seven (7) days after mailing if
sent by registered mail.
9.4 CURRENCY
All references to currency are deemed to mean lawful money of the
United States of America unless expressed to be in some other currency.
9.5 FORCE MAJEURE
If the performance of this Agreement, or any obligation thereunder
except the making of payments hereunder is prevented, restricted, or interfered
with by reason of: fire, flood, earthquake, explosion or other casualty or
accident or act of God; strikes or labour disputes; inability to procure or
obtain delivery of parts, supplies, power, equipment or software from suppliers,
war or other violence; any law, order, regulation, ordinance, demand or
requirement of any governmental authority; or any other act or condition
whatsoever beyond the reasonable control of the affected party, the party so
affected, upon giving prompt notice to the other party, shall be excused from
such performance to the extent of such prevention, restriction or interference;
provided, however, that the party so affected shall take all reasonable steps to
avoid or remove such cause of non-performance and shall resume performance
hereunder with dispatch whenever such causes are removed.
9.6 SEVERABILITY
The parties agree that it is the intention of each party not to violate
any public policy, statutory or common law or government regulation. To the
extent that any provision, portion or extent of this Agreement is deemed to be
invalid, illegal or unenforceable, such provision, portion or extent shall be
severed and deleted herefrom or limited so as to give effect to the intent of
the parties insofar as possible and the parties will use their best efforts to
substitute a new provision of like economic intent and effect for the illegal,
invalid or unenforceable provisions and each remaining provision so remaining
shall be enforced.
9.7 ASSIGNMENT
Customer may assign this Agreement without Changepoint's consent (i) to
an Affiliate of Customer; or (ii) to a purchaser of all or substantially all of
Customer's assets. Otherwise, neither this Agreement nor any rights granted
hereby may be transferred or assigned by Customer to any other person without
Changepoint's prior written consent, (such consent shall not be unreasonably
withheld), and any such attempted assignment shall be null and void. In the
event Customer assigns this Agreement to a third person as permitted by this
Section 9.7 or with consent from Changepoint, Customer shall cease all use of
the Licensed Materials and destroy or cause to be destroyed all copies thereof
within its possession or control and the third party assignee shall agree in
writing with Changepoint to assume all of Customer's obligations hereunder.
Customer shall also certify in writing to Changepoint that the foregoing has
been accomplished. This Agreement shall enure to the benefit of and be binding
upon any successor or assign of Changepoint or, any permitted successor or
assign of Customer. The parties agree that Changepoint may delegate to
affiliates of Changepoint and to agents, suppliers, contractors and resellers of
Changepoint any of the obligations herein imposed upon Changepoint and
Changepoint may disclose to any such persons any information required by them to
perform the duties so delegated to them, but such delegation shall not relieve
Changepoint of its performance obligations hereunder.
9.8 WAIVER
No modification, addition to or waiver of any rights, obligations or
defaults shall be effective unless in writing and signed by the party against
whom the same is sought to be enforced. One or more waivers of any right,
obligation or default shall not be construed as a waiver of any subsequent
right, obligation or default. No delay or failure of either party in exercising
any right hereunder and no partial or single exercise thereof shall be deemed of
itself to constitute a waiver of such right or any other rights hereunder.
9.9 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York without reference to its conflict or choice of
law rules or principles. Customer hereby submits to the non-exclusive
jurisdiction of the courts of the State of New York for any legal action arising
out of this Agreement or the performance of the obligations hereunder or
thereunder. This Agreement shall be deemed to be made in the State of New York,
and Customer agrees not to commence any action, suit or proceeding against
Changepoint or any affiliate of Changepoint or any of their employees, officers
or directors in any jurisdiction other than the State of New York.
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9.10 DISPUTE RESOLUTION AND ARBITRATION
In the event that any dispute or disagreement between Customer and
Changepoint with respect to the interpretation of any provision of this
Agreement, the performance of Changepoint or Customer under this Agreement, or
any other matter that is in dispute between the parties related to this
Agreement, upon the written request of either party, the parties will meet for
the purpose of resolving such dispute. The parties agree to discuss the problem
and negotiate in good faith without the necessity of any formal proceedings
related thereto. No formal proceedings for the resolution of such dispute may be
commenced until either party concludes in good faith that the applicable
resolution through continued negotiation of the matter in issue does not appear
likely. The parties further agree that all disputes hereunder which cannot be
settled in the manner hereinbefore described (any such dispute is referred to
here as a "Dispute") will be settled by final and binding arbitration conducted
in accordance with the American Arbitration Association (or any successor
thereto), as amended from time to time. Judgment upon the award rendered in any
such arbitration may be entered in any court having jurisdiction thereof, or
application may be made to such court for a judicial acceptance of the award and
an enforcement, as the law of such jurisdiction may require or allow.
Notwithstanding the foregoing, disputes with respect to any
Infringement Claim including without limitation any claim based on the
infringement, violation or misappropriation of any Intellectual Property Right
shall not be settled by arbitration, without the prior written consent of the
parties.
The arbitration panel will be composed of one person appointed by the
party requesting the arbitration (the "Applicant"), one person appointed by the
other party (the "Respondent") and a third person to act as chairperson, chosen
by the two arbitrators, or, if both parties agree, the arbitration panel will
consist of a sole arbitrator. No person may be appointed as an arbitrator unless
he or she is independent of the Applicant and Respondent, is skilled in the
subject matter of the Dispute and is not directly or indirectly carrying on or
involved in a business being carried on in competition with the business of the
parties. The decision of the arbitration panel shall be made by a majority vote
or by the sole arbitrator, as the case may be. In the event of the failure of
the arbitration panel to reach a majority decision, the decision of the
chairperson shall constitute the decision of the arbitration panel. The venue
for the arbitration shall be at the City of New York, New York unless otherwise
agreed to by the parties in writing.
CONFIDENTIAL TREATMENT
APPENDIX A
The Components which are the subject of the License, the Software Licenses
granted to Customer and the fees payable to Changepoint hereunder are as
follows:
1. LICENSED SOFTWARE
The Components of the CHANGEPOINT Software which are licensed to Customer
hereunder are the following:
CHANGEPOINT, SQL edition, version 5.2, for _____ (__) users, including the
following modules:
Service Delivery Management
Project and Resource Management
Customer Relationship Management
Support Management.
OLAP module, for five (5) users only
2. SOFTWARE LICENSES
The utilization rights of Customer are as follows:
Customer is granted ____ (__) Client Access Licenses. Each Client Access License
entitles Customer to receive one (1) Enable Code from Changepoint which will
enable Customer to have one (1) user use the Licensed Materials. Customer is
granted five (5) OLAP Licenses. Each OLAP License entitles Customer to receive
one (1) Enable Code from Changepoint which will enable Customer to have one (1)
user use the OLAP module. Customer may install Licensed Software on one or more
computer servers as it desires.
3. LICENSE FEES
The License Fee is $____ less a discount of $____ to yield a net amount of
$_____.
This price is valid until ___________, 1999 after which time Changepoint
reserves the right to change the License Fee.
50% of the License Fee shall be due and payable to Changepoint upon signing of
this Agreement, and 50% of the License Fee shall be due and paid to within 30
days of invoicing by Changepoint.
4. WARRANTY PERIOD
The Warranty Period for the Licensed Software shall mean the period commencing
on the Effective Date and ending ninety (90) days thereafter.
5. MAINTENANCE FEES
Customer will pay Changepoint for each Maintenance Term an annual maintenance
fee (the "Annual Maintenance Fee"). The Annual Maintenance Fee is 18% of the
undiscounted License Fees due to Changepoint hereunder and is payable annually
in advance. The first Annual Maintenance Fee is due upon the expiration of the
Warranty Period and is $___. Subsequent Annual Maintenance Fees are due on the
anniversary of the date the first Annual Maintenance Fee is due. Additional
Maintenance Fees that result from the acquisition of additional Software
Licenses shall become due when the additional Software Licenses are given to
Customer and shall be prorated to the end of the Maintenance Term.
The Maintenance Fees may be increased annually by Changepoint by providing
Customer with notice of not less than thirty (30) days prior to the end of a
Maintenance Term. Changepoint agrees not to increase its Maintenance Fees
annually by more than six percent (6%) from the fees charged in the previous
Maintenance Term.
6. INSTALLATION SERVICES TO BE PROVIDED BY CHANGEPOINT
Changepoint agrees to provide the following services ("Installation Services")
to Customer:
Executive Expectations Review ***
Project Management ***
Infrastructure Support ***
Systems Configuration & Installation ***
Implementation Support ***
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
-14-
CONFIDENTIAL TREATMENT
Administrator Training ***
Train-the-Trainer Training ***
Customer agrees to pay Changepoint for any Installation Services requested by
Customer and provided by Changepoint at the daily rates listed in 6(a) above.
Changepoint estimates that the fees for Installation Services will be $_____.
These daily rates are valid until __________, 1999 after which time Changepoint
reserves the right to change the daily rates.
Changepoint does not guarantee that all services will be provided for the
above-mentioned fees. The fees may be higher or lower depending on the actual
services requested by Customer.
Customer shall reimburse Changepoint for reasonable travel expenses, and
reasonable incidental expenses relating to Installation Service and Maintenance
Service at Changepoint's then current prices then in effect. Changepoint shall
invoice Customer for such fees and expenses on a monthly basis. Customer shall
not be liable for the aforesaid expenses unless Customer has given Changepoint
approval to incur them.
CHANGEPOINT INC.
Signature ________________________ Signature ________________________
Name _____________________________ Name _____________________________
Title ____________________________ Title ____________________________
***The omitted material has been filed separately with the Securities and
Exchange Commission pursuant to a request for confidential treatment.
SCHEDULE H
[LOGO]
SOFTRAX PRODUCT AND SERVICES AGREEMENT
EFFECTIVE DATE:
SOFTRAX CORPORATION, a Delaware corporation with offices located at 00 Xxxxxxx
Xxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 ("SOFTRAX") offers to sell and deliver, and
COMPANY, a corporation with principal offices located at
_____________________________________________________________________
("Customer") hereby agrees to purchase those products and services identified
below, at the pricing set forth below in the Proposal and on the terms and
conditions set forth below and in Attachment 1 (SOFTRAX Standard Terms and
Conditions), Attachment 2 (Software License Terms), Attachment 3 (Services) and
Attachment 4 (Travel Guidelines) to the Proposal, together with such other
Attachments as the parties may agree to add from time to time (this agreement,
including the Proposal and Attachments, collectively, the "Agreement"). This
Agreement shall not be effective until executed by both parties.
PROPOSAL
------------------------------------------------------------------------------------------------------------------
PRODUCTS PRICING/
LICENSE
FEES
------------------------------------------------------------------------------------------------------------------
[Enter here suites, modules and/or applications to be purchased AND INDICATE
PLATFORM OPERATING SYSTEM AND DATABASE ON WHICH THEY WILL BE RUNNING. Also
indicate number of full use Seats, Lite Seats (WebOps), Casual Seat and CPU
(WebOps) licenses purchased, and price per additional seats/CPUs and/or blocks
of seats/CPUs]
Payment terms: 50% of license fees on execution of Agreement; balance on delivery of
Software.
------------------------------------------------------------------------------------------------------------------
SERVICES PRICING
------------------------------------------------------------------------------------------------------------------
Annual Support Services (20% of list price of Products purchased) $____________
[Enter here description of additional Services to be purchased. Clearly indicate Indicate estimate
where pricing is an estimate only, as opposed to, for example a definite $X,000 per Pricing in this
day for training. Where services are to be charged based on a daily or weekly rate, Column as well.
so indicate. Reference a Statement of Work to be developed by the parties for the
Services following execution of the Agreement]
------------------------------------------------------------------------------------------------------------------
-16-
------------------------------------------------------------------------------------------------------------------
Service estimates are based on blended hourly rates. Services will be invoiced
at actual hourly rates of Softrax professional performing Service. Rate scale
for Softrax professionals are as follows:
Engagement Manager: $200/hour
Principal Consultant: $190/hour
System Architect: $190/hour
Senior Technical Consultant: $175/hour
Senior Consultant: $175/hour
Technical Consultant: $160/hour
Consultant: $160/hour
Payment Terms: 50% of Service fees (including estimates) on execution Of
Agreement; balance for Support Services only on delivery of Software. Balance
for other Services invoiced monthly during period of Services following paydown
of original deposit.
------------------------------------------------------------------------------------------------------------------
The parties further agree that any additional services and/or products which
may be purchased by Customer from time to time hereafter shall be governed by
the terms and conditions of this Agreement, unless other terms are agreed to
in writing by the parties for the specific additional services and/or
products purchased. The pricing set forth above for Products shall remain in
effect for an additional period of three months following the Effective Date.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives effective as of the date first above
written.
CUSTOMER NAME SOFTRAX CORPORATION
By: ______________________________ By: ______________________________
Name: ____________________________ Name: ____________________________
Title: ___________________________ Title: ___________________________
-17-
ATTACHMENT 1: SOFTRAX STANDARD TERMS AND CONDITIONS
(applicable to all purchases of Products and/or Services)
I. DEFINITIONS
1.1 CONFIDENTIAL INFORMATION. The term "Confidential Information" shall refer to
any materials or information received from the other party and which have been
designated as confidential or proprietary on their face or in a separate writing
by the disclosing party, or which, under the circumstances surrounding
disclosure, ought to be recognized as the confidential or proprietary material
of the disclosing party. The terms of the Agreement shall be deemed Confidential
Information. For purposes of this Agreement, all internal business, financial
and marketing information of each party, and any technical documentation or
information relating to the architecture, code, conceptual structure or internal
operation of a Product (including the know-how immanent therein), shall be
deemed Confidential Information whether or not expressly designated as such.
1.2 PRODUCT. The term "Product" shall refer to any SOFTRAX software application
or suite of applications licensed and delivered to Customer hereunder, including
any Product Upgrade or Product Update or Product customization which may be
delivered to Customer either with the initial delivery of the Product or at any
time thereafter. The term "Product" shall not refer to any third party product
not licensed by Customer from SOFTRAX. Where applicable from context, the term
"Product" shall also refer to the User Documentation for such Product.
1.3 PRODUCT UPDATE. The term "Product Update" shall refer to any new release of
a Product or of Product documentation the primary purpose of which is to correct
or provide a workaround for a defect or problem with such Product or such
Product documentation.
1.4 PRODUCT UPGRADE. The term "Product Upgrade" shall refer to any new release
of a Product or of Product documentation where such release enhances or improves
Product performance and/or functionality, or which provides incremental
functionality(ies) to an application, and which, in either event, is customarily
provided to SOFTRAX customers who have contracted for Annual Support Services
(see Attachment 3) with respect to that Product. The term "Product Upgrade" does
not include (a) new modules within a Product suite where such modules offer
discrete new functionalities in addition to or together with the licensed
applications, or (b) new software products released by SOFTRAX which may provide
functionalities comparable to those provided by the Products but which are
marketed as separate and discrete product alternatives from the Products.
1.5 SEATS. The term "Seat" shall refer to one copy of the client portion of the
Product. The term "Casual Seat" shall refer to a "read only" copy of the client
portion of the Product. In addition, the WebOps module affords certain limited
use seats which are referred to as "Lite Seats." Limited use, for purposes of
defining a Lite Seat, shall mean intermittent use by a user in support of
his/her job function provided such job function is not in the area of finance
and operations. The uncapitalized word "seat" shall refer to either a full use
Seat, a Casual Seat and/or a Lite Seat, as applicable from context.
1.6 SERVICES. The term "Services" shall refer to any services, including Annual
Support Services, provided to Customer directly by SOFTRAX or through SOFTRAX
where SOFTRAX has expressly agreed, in writing, to act as general contractor and
to oversee and take responsibility for the work performed. The term "Services"
shall expressly include any consulting, installation, integration, support,
maintenance, customization or other Product-related service which may be
provided to Customer by SOFTRAX. Any Service involving third parties to be
overseen by SOFTRAX must be individually designated as such either in the
Agreement or by separate subsequent purchase order issued under the Agreement
and accepted by SOFTRAX.
II. DELIVERY AND PAYMENT TERMS.
-18-
2.1 DELIVERY. Delivery of Product shall be F.O.B. SOFTRAX's point of shipment to
the Customer location set forth for Customer in the first paragraph of the
Agreement and shall occur within fifteen (15) business days following Customer's
remittance to SOFTRAX of the downpayment described in section 2.2 below.
Delivery of Services shall be per the terms of the Statement of Work if one is
being used, or per SOFTRAX's standard terms for such Services.
2.2 PRICING AND PAYMENT TERMS. Fees for Products and Services are as set forth
in the Proposal. Fifty percent (50%) of all Service and Product fees (including
estimated fees) are due and payable immediately upon execution of the Agreement.
The balance of the fees for Product and for Annual Support Services shall be due
and payable upon delivery of the Products to Customer. Unless otherwise set
forth in the Proposal, the balance of fees for all other Services shall be
invoiced as incurred, on a monthly basis, after the initial downpayment for such
Services has been exhausted. Fees include, when applicable, packing consistent
with prevailing commercial practices. Prices are exclusive of sales, use and
other applicable taxes and duties (with the exception of those based on
SOFTRAX's revenues or net worth) all of which shall be the responsibility of
Customer. Upon SOFTRAX's request, Customer shall promptly provide SOFTRAX with
documentation confirming payment of all such tax payments. All pricing shall be
stated in United States currency. Unless otherwise stated in the Agreement, all
SOFTRAX invoices shall be due and payable fifteen (15) days following the
invoice date. All fees paid are non-refundable.
2.3 EXPENSE REIMBURSEMENTS. Customer agrees to reimburse SOFTRAX for all
reasonable expenses incurred in connection with SOFTRAX's performance of
Services under the Agreement, including, without limitation, expenses for
travel, lodging and related living expenses that are consistent with the travel
guidelines set forth in Attachment 4 hereto. Such expenses shall be invoiced by
SOFTRAX monthly or as incurred.
III. CONFIDENTIAL INFORMATION. Each party agrees that it shall not publish,
disclose or otherwise provide to any person (except employees of such party with
a legitimate need to know and who have agreed in writing to maintain the
confidentiality of the applicable material), any Confidential Information it
receives hereunder; provided, however that neither party shall have an
obligation to protect Confidential Information received from the other when such
information: (1) as can be reasonably documented, was in the first party's
possession at the time it was received from the second party; (2) is or becomes
a matter of public knowledge; (3) is rightfully provided to the first party by a
third party without restrictions of confidentiality; (4) as can be reasonably
documented, is independently developed by the first party without breach of this
Agreement; or (5) is required to be disclosed by the first party by operation of
law. In the event either party determines to disclose any Confidential
Information provided to it by the other party based on one of the exclusions set
forth above, such party shall provide ten (10) days written notice to the other
party of its intention to so disclose and the basis on which it is doing so.
Each party acknowledges and accepts the responsibility to use its best efforts
to safeguard the Confidential Information and to prevent its unauthorized use or
disclosure taking those measures the receiving party uses to protect its own
confidential information and in any event, no less than reasonable measures.
Each party acknowledges that violations of the terms hereof may cause the other
immediate and irreparable damage for which monetary damages may be inadequate
and for which the other party is entitled to seek injunctive relief.
IV. SOFTRAX INTELLECTUAL PROPERTY INDEMNIFICATION. If any action is instituted
against Customer based upon a claim that a Product infringes a United States
patent, copyright or trade secret, SOFTRAX shall defend such action at its own
expense on behalf of Customer and shall pay all damages attributable to such
claim and awarded against Customer after SOFTRAX has exhausted all rights of
appeal which SOFTRAX in its sole discretion desires to exercise, provided that
Customer gives SOFTRAX prompt notice of and control over any such claim, and any
negotiations for its settlement. If a final injunction is obtained against
Customer's use of a Product due to an infringement of a United States patent,
trade secret or copyright, or, if in SOFTRAX's sole judgment, it would be cost
effective to do so, then SOFTRAX may, at its option and expense, and as
Customer's exclusive remedy hereunder, either procure for Customer the right to
continue using such Product, replace or modify the Product so that it is no
longer infringing but continues to provide comparable functionality, or
repossess all properly licensed copies of the Product in Customer's possession,
reimburse Customer for the amortized purchase price of such Products (based on a
three year straight line amortization rate) and terminate this Agreement.
SOFTRAX shall have no liability to Customer for any infringement action which
arises out of the use of a
-19-
Product (1) for a process not contemplated by the user documentation, (2)
after it has been modified by Customer or a third party, (3) for purposes not
contemplated by this Agreement (including, but not limited to, distribution
of the Product to third parties) or (4) in combination with any other
equipment or software when use of the Product as a standalone or with other
software and/or equipment would not be infringing. Additionally, SOFTRAX
shall not be liable for any costs incurred by Customer without SOFTRAX's
prior written authorization. This Section IV sets forth the entire obligation
of SOFTRAX and the exclusive remedy of Customer against SOFTRAX or any of its
suppliers for any alleged infringement or adjudicated infringement of any
patent, copyright or other intellectual property right by a Product or
arising out of any Service provided by SOFTRAX under the terms of or in
connection with the Agreement.
V. LIMITATION ON DAMAGES. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER
FOR (1) INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES, OR (2) ANY
DAMAGES WHATSOEVER RESULTING FROM LOSS OF USE, DATA, REVENUES OR PROFITS, COSTS
OF PROCUREMENT OF SUBSTITUTE PRODUCTS OR SERVICES, IN EITHER EVENT ARISING OUT
OF OR IN CONNECTION WITH THIS AGREEMENT, OR THE PERFORMANCE OR NON-PERFORMANCE
OF EITHER PARTY HEREUNDER, OR THE PRODUCTS OR SERVICES PROVIDED BY OR THROUGH
SOFTRAX HEREUNDER, EVEN IF THE WARRANTY REMEDY FAILS IN ITS ESSENTIAL PURPOSE
AND EVEN IF SUCH PARTY HAD BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. EACH
PARTY AGREES THAT THE OTHER PARTY'S LIABILITY UNDER OR IN CONNECTION WITH THIS
AGREEMENT OR RELATING TO ANY SERVICE OR PRODUCT PROVIDED HEREUNDER SHALL BE
LIMITED SOLELY TO THE FIRST PARTY'S DIRECT DAMAGES AND IN NO EVENT SHALL EXCEED
THE TOTAL AMOUNT IN FEES PAID BY CUSTOMER TO SOFTRAX ASSOCIATED WITH THE PRODUCT
AND/OR SERVICE GIVING RISE TO THE CLAIM AND PAID BY CUSTOMER DURING THE YEAR
PRECEDING THE EVENT OR ACTION GIVING RISE TO THE CLAIM. SOFTRAX EXPRESSLY
DISCLAIMS, AND CUSTOMER AGREES, THAT SOFTRAX SHALL HAVE NO LIABILITY OF ANY KIND
FOR ANY THIRD PARTY PRODUCT OR SERVICE. Any claim made under or in connection
with this Agreement and the Services and/or Products provided hereunder shall be
made within one (1) year from the date on which the claiming party first had
notice of the facts giving rise to the claim. Customer acknowledges and agrees
that it shall have no claim against third party suppliers by reason of the
performance or non-performance of the Products or related to the components such
third parties may have supplied for the Products.
VI. TERMINATION. The software licenses granted under the terms of this
Agreement, and SOFTRAX's obligations to continue providing Services hereunder,
shall terminate in the event of Customer's breach of a material term in the
Agreement (including nonpayment of amounts owed pursuant to the terms set forth
herein), where such breach continues for a period of ten (10) days following
written notice thereof by SOFTRAX; provided, however, that in the event the
breach by Customer of either Section III (Confidential Information) or
Attachment 2 (Software License Terms) is not of a nature as to be remediable, or
is reasonably believed by Softrax to be the result of willful, reckless or
grossly negligent acts of Customer, then SOFTRAX's termination of this Agreement
and the licenses granted hereunder shall be effective immediately with or
without notice to Customer. In the event of any such termination, or in the
event Customer elects to terminate its licenses under this Agreement, Customer
shall immediately destroy or return to SOFTRAX all copies in any form whatever
of the PRODUCTS and of SOFTRAX Confidential Information, and any portion
thereof, and shall provide written certification to SOFTRAX of such destruction
or return. Terms and conditions in this Agreement, which by their nature and
context, are intended to survive any termination, shall so survive such
termination. Without limiting the foregoing, surviving provisions shall include
those set forth in Sections III, V, VI and VII of Attachment 1, paragraphs 1
through 3 of Attachment 2, and paragraphs 4 and 5 of Attachment 3.
VII. MISCELLANEOUS
7.1 ENTIRE AGREEMENT; ASSIGNMENT; CONSTRUCTION; PERFORMANCE. This Agreement
constitutes the entire agreement between the parties with respect to the
Products and Services to be provided by SOFTRAX thereunder. The Agreement
supersedes any prior agreements, promises or understandings, whether written or
oral, relating to the matters covered
-20-
hereunder. Any modification of the terms and conditions of this Agreement
must be in writing and signed by an authorized representative for each party.
Any purchase orders issued by Customer shall be deemed to be for Customer's
convenience only and, notwithstanding acceptance of such orders by SOFTRAX,
shall in no way change or add to the terms and conditions of this Agreement.
Customer may not assign this Agreement or any of the rights or obligations
hereunder without the prior written consent of SOFTRAX which consent will not
be unreasonably withheld. Failure of either party to insist in any instance
upon strict performance by the other party of any term or condition of this
Agreement shall not be construed to be a permanent waiver of such or any
other term or condition of this Agreement. Headings used in the Agreement are
for reference purposes only and shall not be deemed a part of the Agreement.
If any provision of this Agreement is declared invalid by any authorized
tribunal, then such provision shall be amended or construed in a manner so as
to conform to the requirements for validity as declared at such time with as
much adherence to the original intent of the provision as possible. In any
event, the remaining provisions of this Agreement shall remain in full force
and effect. Nothing contained in this Agreement shall be construed as
creating any agency, partnership or other form of joint enterprise between
the parties. In no event shall either party have the right to bind the other
party except as may be expressly provided for herein. Neither party shall be
liable to the other for any delay in the performance of its obligations
hereunder which is unavoidable with reasonable diligence, which occurs
without its fault or negligence, and which is caused by an event or third
party not within its reasonable control; provided, however, that the party so
delayed in performance shall promptly notify the other party of the delay and
its expected duration.
7.2 OWNERSHIP. SOFTRAX and/or its third party suppliers retain full ownership of
the Products, subject to licenses which may be granted to third parties. SOFTRAX
shall also own any software or other materials it produces as part of any
Services which may be performed under the Agreement. Subject to the terms
protecting Confidential Information, Customer acknowledges that SOFTRAX may use
any ideas, concepts, modifications and information arising out of the Services
and relating to SOFTRAX Products in the development and distribution of new
products, Product enhancements or applications.
7.3 NOTICE. Notice to either party to this Agreement shall be deemed received on
the day of delivery if delivered, with confirmation of receipt, by electronic
facsimile, by courier or by hand during normal business hours, and the following
day if delivered after normal business hours. Delivery of all notices shall be
made to the following persons at the respective addresses of the parties first
set forth above: for SOFTRAX, to the attention of the Vice President, Finance
(fax. number (000) 000-0000); for Customer, to the attention of
_____________________________(fax. number ___-___-____ ).
7.4 PUBLICITY. Each party agrees to submit to the other party for approval prior
to its release any advertising, press releases, sales promotions or other
publicity relating to this Agreement where such materials reference the second
party; provided, however, that SOFTRAX shall be entitled to identify Customer as
a SOFTRAX customer in press releases, marketing materials and other publicly
distributed information. SOFTRAX shall not use Customer as a reference without
Customer's prior consent.
7.5 NO HIRE. Subject to any limitations of applicable law, for so long as
SOFTRAX is providing Product or Services of any kind to Customer, and for the
six month period thereafter, neither party may solicit for employment or employ,
directly or indirectly, an employee of the other party who has had contact as a
result of this Agreement with the first party (unless such employee has left the
employment of such party at least six (6) months previously) without the second
party's prior written consent. In the event either party violates the terms of
this section, that party shall pay to the non-breaching party an amount equal to
the greater of (a) the total annual compensation (including, without limitation,
salary, benefits, bonuses and stock options) being paid to the employee by the
non-breaching party at the time of the breach, and (b) the total compensation
paid or to be paid to the employee by the breaching party during the first year
that the employee is retained or hired by such party.
-21-
7.7 GOVERNING LAW. This Agreement shall have the effect of a sealed instrument
and shall be governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts, excluding its conflict of law rules. The parties
agree that Massachusetts shall be the exclusive venue for claims arising out of
or in connection with this Agreement. Customer agrees to submit to the personal
jurisdiction of Massachusetts with respect to such claims. The parties further
agree that all disputes, claims or controversies arising out of or relating to
this Agreement or the parties' relationships outside this Agreement, whether
based on facts occurring before, during or after the term of this Agreement,
that are not resolved by the parties' good faith attempt to negotiate a
resolution shall be submitted to final and binding arbitration before the
American Arbitration Association("AAA") (or another entity agreed upon by the
parties), pursuant to the United States Arbitration Act, 9 U.S.C. Section1, et.
seq.; provided, however, that nothing herein shall prevent either party from
seeking injunctive relief in a court of law or other administrative forum with
respect to violations of the terms of Section III (Confidential Information)
above. The arbitration will be conducted in accordance with the provisions of
AAA's (or other agreed upon entity's) streamlined arbitration rules and
procedures in effect at the time of the filing of the demand for arbitration.
The parties will cooperate with AAA (or other agreed upon entity) and each other
in selecting a single arbitrator who shall be a former judge or justice with
substantial experience in resolving business disputes with particular experience
in resolving disputes involving computer software. The arbitrator shall have the
power to award costs and attorneys' fees to the prevailing party. In the absence
of such an award, the cost of arbitration will be shared equally by the parties
and each party shall bear its own expenses. The provisions of this section may
be enforced by any court of competent jurisdiction. The arbitrator shall not be
empowered to award damages in excess of, or inconsistent with, the liability
limitations contained in this Agreement. The parties mutually and voluntarily
agree that the United Nations Convention on Contracts for the International Sale
of Goods shall not apply to transactions covered by this Agreement. Customer
agrees not to permit the delivery of the Product in violation of any applicable
United States or Territory export control laws, restrictions and regulations
relating to the distribution of technical information and software, as they
exist from time to time, including, without limitation, those promulgated by the
United States Department of Commerce.
EACH PARTY RECOGNIZES AND AGREES THAT THE WARRANTY DISCLAIMERS AND LIABILITY AND
REMEDY LIMITATIONS IN THIS AGREEMENT ARE MATERIAL BARGAINED FOR BASES OF THIS
AGREEMENT AND THAT THEY HAVE BEEN TAKEN INTO ACCOUNT AND REFLECTED IN
DETERMINING THE CONSIDERATION TO BE GIVEN BY EACH PARTY UNDER THIS AGREEMENT AND
IN THE DECISION BY EACH PARTY TO ENTER INTO THIS AGREEMENT.
-22-
ATTACHMENT 2: SOFTWARE LICENSE TERMS
(APPLICABLE TO ALL PRODUCTS DELIVERED UNDER THE AGREEMENT)
1. LICENSED USE OF PRODUCT. Customer is granted a worldwide, perpetual (unless
terminated for breach of the Agreement) license to use the Products solely for
its internal business purposes but shall not use the Products for the internal
purposes of third parties. Customer is authorized to make (a) a reasonable
number of copies of the server portion of the Products for back-up and archival
purposes only, and (b) only that number of copies of the client portion and user
documentation of the software equal to the number of seat licenses which have
been purchased under this Agreement. Customer acknowledges that certain Products
require an "enabling key" which must be obtained from SOFTRAX in order for such
Products to be operational. All copies or partial copies shall include all
copyright, trademark and other proprietary notices and license terms where and
as found in the original Product delivered to Customer. Customer may not
disassemble, reverse engineer, decrypt, decompile, create derivative works from,
or translate any Product, or portion thereof, or recreate or attempt to recreate
the Products, in whole or in part by reference to the Products, or perform any
process intended to determine the source code for the Product except to the
extent that the foregoing restriction is prohibited by applicable law; nor shall
Customer sublicense, distribute, deliver, assign or otherwise provide to a third
party any Product or portion thereof and any attempt to do so will be void AB
INITIO; nor may Customer modify the Products except as contemplated by the
Product user documentation. In the event that Customer elects to terminate its
use of the Software, and in connection therewith to transfer data existing in
the Software database to a different application or database, Customer shall
provide written notice to Softrax of any such election and shall provide Softrax
with prior written notice of and the opportunity to attend and participate in
any database transfer which may be pursued by Customer in order to ensure the
protection of that Softrax proprietary, schematic and architectural information
within the Software which might otherwise be disclosed in connection with any
such transfer. Customer agrees that the User Documentation shall only be used
with the Product with which it is associated. Customer further acknowledges and
agrees that third party suppliers of software to SOFTRAX are third party
beneficiaries of the terms governing Products under this Agreement with respect
to the Products which contain their software and such third parties may enforce
such terms directly.
2. PRODUCT WARRANTY. SOFTRAX hereby warrants to Customer that the Products shall
be free from any material defect in materials and workmanship and shall operate
substantially in accordance with their user documentation for a ninety (90) day
period commencing as of the date of the Products' delivery to Customer ("the
"Warranty Period"). SOFTRAX further warrants that when used in accordance with
its user documentation, and provided that the hardware and software used in
combination with the Products process and transmit correct calendar date data to
the Products, the Products will correctly process and present calendar dates
falling on or after January 1, 2000 in the same manner as the Products process
and present calendar dates falling on or before December 31, 1999 ("Y2K
Warranty"). The foregoing Y2K Warranty shall expire on March 31, 2000. Softrax
does not provide a X0X Xxxxxxxx with respect to any third party software or
hardware which may be used by Customer in conjunction with the Products. In the
event a Product is found to be defective or non-conforming during the Warranty
Period, then SOFTRAX shall, at its option, repair or replace such Product upon
its return to SOFTRAX by Customer pursuant to SOFTRAX's standard warranty return
procedures, or, if SOFTRAX determines, in its sole discretion, that neither
repair nor replacement of the defective Product is commercially practicable,
SOFTRAX will, upon receipt of the defective Product from Customer, refund to
Customer the license fees paid by Customer for the returned Product . The terms
of this warranty shall not apply to any Product that (1) has been modified by
Customer or a third party, (2) has been used in combination with equipment or
software other than that which is consistent with its user documentation, (3)
has been damaged by negligence, misuse, fire casualty or other external causes,
or (4) has been subjected to unusual physical or electrical stress. SOFTRAX does
not warrant that the Product will perform error free or without interruptions,
nor does SOFTRAX warrant that the Product will meet Customer's requirements.
Except as expressly provided for in this paragraph, Customer agrees to bear the
entire risk as to the adequacy and performance of the Product. Customer
expressly acknowledges its responsibility to regularly back up data maintained
on any computer system using the Products and to adequately test each new
release of the software in an environment which reasonably simulates Customer's
production environment prior to implementing the same. EXCEPT FOR THE EXPRESS
WARRANTIES SET FORTH IN THIS
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PARAGRAPH 2, SOFTRAX DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, WITH
REGARD TO THE PRODUCTS, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES
OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, FREEDOM FROM VIRUSES
OR FREEDOM FROM INFRINGEMENT, OR THOSE ARISING FROM THE COURSE OF DEALING
BETWEEN THE PARTIES OR USAGE OF TRADE. This Paragraph 2 sets forth Customer's
exclusive remedy in warranty and SOFTRAX's sole warranty responsibility in
the event a Product is defective or fails to perform during the Warranty
Period. Customer acknowledges and agrees that SOFTRAX extends no warranties
of any sort or nature to or by any third party, or with respect to any third
party product or service.
3. PROPRIETARY RIGHTS. Customer acknowledges that the Products (including all
methods, concepts or techniques utilized therein) are commercially valuable
property of SOFTRAX and/or its suppliers and which it and/or they treat as
confidential, proprietary and containing of trade secrets. Except for the rights
expressly granted to Customer hereunder, no right in or title to the Products,
or any intellectual property rights therein or associated therewith, shall be
deemed to have been vested in or transferred to Customer under the terms of the
Agreement. All title to and ownership of the Products, and the intellectual
property rights therein or associated therewith, remain with SOFTRAX and its
suppliers. SOFTRAX shall be entitled to audit, on a reasonable basis, Customer's
use of the Products to ensure compliance with the terms of this license.
Customer may, at its option and payment of the annual subscriber fee,
participate in the source code escrow account which has been established by
SOFTRAX for the benefit of its customers.
4. PER SEAT/CPU LICENSING. Customer acknowledges that the Product is licensed to
Customer on a per server, per seat and/or per central processing unit ("CPU")
basis. In the event Customer elects to expand the number of servers, seats
and/or CPUs licensed with respect to any Product, Customer shall promptly notify
SOFTRAX of the same and remit to SOFTRAX the incremental license fees associated
with the CPU, seat and/or server increase pursuant to the fee schedule set forth
in the Proposal, or if not in the Proposal, then at SOFTRAX's then prevailing
rates. Customer will not allow the number of servers, CPUs or seats of the
Products to exceed the number of server, CPU or seat licenses paid for by
Customer and shall provide SOFTRAX with written notice of the number of seats,
CPUs and servers being used on a quarterly basis.
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ATTACHMENT 3: SERVICES
(APPLICABLE TO ALL SERVICES PROVIDED UNDER THE AGREEMENT)
1. ANNUAL SUPPORT SERVICES. SOFTRAX Annual Support Services shall commence as of
the effective date of this Agreement. Annual Support Services can be renewed for
successive one (1) year terms by payment of the then current annual renewal fee.
SOFTRAX shall provide notice to Customer when the renewal fee is due. SOFTRAX
shall not increase the renewal fee for Support Services by more than 10% during
any twelve (12) month period. SOFTRAX Support Services do not include on site
services, those services addressed in paragraphs 2 and 3 below, or Product that
is not at the latest revision level as of the start date of the then current
term, that has been modified without the authorization of SOFTRAX or that has
been damaged by negligence, misuse, use with inappropriate software or equipment
or by other external causes. For so long as Customer has purchased Support
Services and current in its payments to SOFTRAX under this Agreement, Customer
shall be entitled to receive unlimited telephone support, Monday through Friday
(SOFTRAX holidays excluded), between the hours of 8:30 AM and 8:00 PM Eastern
Time Zone, through Customer's designated system representatives. For this
purpose, Customer shall designate two of its employees as designated system
representatives, each of whom shall have received training on the Products by
SOFTRAX and shall be relatively proficient in the operation of the Products.
Such Customer representatives shall promptly report to SOFTRAX support any
problems with the Product performance which prevent the Products from operating
substantially in accordance with their user documentation together with such
information as may be required by SOFTRAX to replicate such problems. SOFTRAX
shall address any such replicable problems with an effort commensurate with
their severity and shall deliver to Customer a remedial release or workaround as
it becomes available. In addition, for so long as Customer has purchased Support
Services and current in its payments to SOFTRAX under this Agreement, Customer
shall receive, at no additional cost, Product Upgrades and Product Updates to
the Products which are made generally available at no cost by SOFTRAX to
customers who have purchased Support Services; provided, however, that to the
extent any Product Upgrades include materially new technology for which SOFTRAX
is required to pay additional license fees to the supplier(s) of such
technology, then such Product Upgrades shall be provided to Customers who have
purchased Annual Support Services at the pass through cost of such additional
license fees; and provided further, however, that Customer may elect not to
accept Product Upgrades requiring the payment of additional license fees without
jeopardizing the validity of their support coverage for the then current term.
Customer shall receive one original of any Product Upgrade and/or Product Update
delivered hereunder in electronic form or on media, according to the general
form of distribution implemented by SOFTRAX.
2. TRAINING. SOFTRAX will provide on site and/or remote training on SOFTRAX
Products as specified in the Proposal. Additional Product training will be
available to Customer on SOFTRAX's then standard terms and rates.
3. CONSULTING, INSTALLATION, INTEGRATION AND CUSTOMIZATION SERVICES. SOFTRAX
will provide those consulting, installation, integration and customization
services which may be identified on the Proposal or subsequently by written
agreement of the parties. SOFTRAX shall reserve the right to determine the
method, details and means of performing the required Services. In preparing any
Statement of Work, SOFTRAX shall use its best efforts to accommodate Customer
scheduling and staffing concerns. Statements of Work shall also include any
special terms, milestones and pricing which may be agreed upon by the parties
for specific Services. Additional or extended Services requested by Customer
shall be performed at SOFTRAX's then hourly rates unless otherwise agreed upon
in writing by the parties. Where Services are to be provided by SOFTRAX, or a
SOFTRAX designee, at Customer's site, Customer agrees to provide appropriate
workspace for SOFTRAX, with sufficient access to standard facilities such as
telephone lines, fax and copier equipment, and the like.
4. SERVICES WARRANTY. SOFTRAX warrants that all Services provided under the
Agreement shall be performed professionally, in a workmanlike manner and by
employees with appropriate skills and expertise. SOFTRAX does not warrant that
individual Statements of Work will not be subject to modifications or delays but
SOFTRAX will work to minimize any such modifications or delays unless the same
have been requested or required by Customer or otherwise occur through no fault
of SOFTRAX. If Customer is dissatisfied at any point with the performance of any
SOFTRAX
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employee(s), Customer shall promptly notify SOFTRAX. If SOFTRAX agrees that
the performance of the employee was materially below the level of competence
reasonably associated with the Service being provided, SOFTRAX will arrange
for the performance to be raised to the warranted level, and for identifiable
defects caused by prior substandard performance to be cured. Except as
provided under this paragraph, CUSTOMER'S SOLE AND EXCLUSIVE REMEDY, IN THE
EVENT IT IS DISSATISFIED WITH A SOFTRAX SERVICE, IS TO TERMINATE THAT SERVICE
PURSUANT TO THE TERMS OF PARAGRAPH 5 BELOW.
5. TERMINATION. Customer may terminate Services at any time upon thirty (30)
days written notice; provided, however, that no fees already paid for such
Services shall be refundable under any circumstances; and provided further, that
Customer shall pay to SOFTRAX for time and materials spent by SOFTRAX in
connection with such Services prior to the effective date of termination, that
exceed any amounts already paid for such Services by Customer, as calculated on
a time and materials basis using SOFTRAX's then current rates for the same.
Invoices for the same shall be payable immediately upon receipt. SOFTRAX shall
use its best efforts during the thirty (30) day notice period to close out the
Services in a manner which provides the most benefit to and future use for
Customer as to that work which may be in progress as of the notice date.
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ATTACHMENT 4: TRAVEL EXPENSE GUIDELINES
(APPLICABLE TO ALL SERVICES PROVIDED UNDER THIS AGREEMENT)
The intent of the guidelines set forth in this Attachment 4 is to provide
Customer with efficient and cost-effective Services. In any given situation, the
SOFTRAX employee should use sound business judgment in evaluating alternatives
available to him/her with the objective of minimizing, as reasonable, travel
expenses. All invoices to Customer for reimbursable travel related expenditures
will include: the name of the traveler(s); dates of travel; reason for the trip.
Customer shall remit payment to SOFTRAX within thirty (30) days of receipt of
each valid invoice.
AIRFARE
Economy or coach travel is to be utilized whenever possible on flights within
the United States. SOFTRAX shall use commercially reasonable efforts to obtain
discounted fares subject to priority being accorded to non-stop and direct
flights.
LODGING
SOFTRAX should utilize commercially reasonable efforts to obtain modestly priced
business class accommodations that are in reasonable proximity to Customer's
location. Prior to booking, SOFTRAX should consult with Customer as to the
availability of any negotiated rates Customer may have with surrounding business
class hotels and determine if such charges can be billed directly to Customer by
the hotel.
GROUND TRANSPORTATION
SOFTRAX should use sound business judgment in determining the most economical
mode of available transportation whenever practical. Rentals should be limited
to "mid-size" vehicles unless three or more individuals will be sharing the
automobile or if a special promotion makes "larger-size" rentals more
economical.. Gasoline and other rental related expenditures will be reimbursed
based upon actual costs. Taxi, subway and other forms of ground transportation
will be reimbursed at actual cost.
PARKING/TOLLS
Where reasonably practicable, SOFTRAX will utilize long-term or remote parking
for airport parking. All other parking and tolls will be reimbursed at actual
costs.
ACTUAL OUT-OF-POCKET EXPENSES (MEALS & INCIDENTALS)
Customer will reimburse SOFTRAX for the cost of meals, tips and other related
out-of-pocket living expenses incurred while traveling. Customer will not
reimburse SOFTRAX for newspapers, cleaning charges, vending machine charges,
toiletries, personal entertainment and such other like items. SOFTRAX charges a
flat fee of $10.00 per day to cover telephone charges.
SCHEDULE I
PROGRAM QUICK START
Changepoint will provide to OEM the following:
1. Training: Sales training (three days tentatively scheduled for January,
2000), implementation/support training (up to 25 days).
2. Engineering support (up to 30 days).
2.1. Provide initial training to OEM's technical staff to teach it:
2.1.1. how to use Changepoint functionality
2.1.2. how to administer Changepoint
2.1.3. the data model, technical architecture and
integration points of Changepoint
2.1.4. assist OEM in the design, development, testing and
debugging of integration of Changepoint with OEM
2.2. Provide and define methods and processes for OEM Client
Services to efficiently work with Changepoint's support
services organization
2.2.1. Provide access to Changepoint knowledge base
2.2.2. Provide specialized support training
2.2.3. Create/understand escalation process
3 Pre-sales support (up to 30 days)
3.1. To be provided on request for up to 15 Prospects.
4. Final total is up to 85 days.
OEM to reimburse Changepoint for reasonable travel expenses as per travel
expense guidelines. Changepoint to assist at more than one call per day provided
that calls are in the same geographic distance.
Changepoint shall also deliver the following to OEM:
MATERIALS
1. Training materials, including updates and additions as released from
time to time, in electronic and hard copy.
2. Comprehensive technical documentation for software (including, without
limitation, entity relationship diagrams), including updates and
additions released from time to time, in electronic and hard copy.
3. Soft copy of marketing collateral materials, including updates and
additions as released from time to time.
4. Soft copy of user documentation, including updates and additions as
released from time to time.
5. Reasonable number of Demonstration/Marketing copies of the Changepoint
software, including demonstration data sets provided that such copies
remain at all times under the control of OEM. (For example, copies are
not installed and left on Prospect equipment for
demonstration/marketing/evaluation purposes.)
6. Soft copy of presentations and proposal materials, including updates
and additions as released from time to time.
