IBM/QCS Confidential
Exhibit 10.12
SERVICES AGREEMENT
BETWEEN
INTERNATIONAL BUSINESS MACHINES CORPORATION
AND
QCS CORPORATION
NOVEMBER 23, 1996
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This Services Agreement is by and between International Business Mechines
Corporation ("IBM"), a New York corporation having an office at 000 Xxxxxxxx
Xxxxxx, Xxxxxxxxx, Xxx Xxxx 00000, and QCS Corporation ("QCS"), a Delaware
corporation, having a principal place of business at 000 Xxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx Xxxx, Xxxxxxxxxx 00000.
Certain IBM or its suppliers Services, custom solutions, and revenue based
payment provisions are described in the applicable Attachments and Transaction
Documents to this Agreement.
This Agreement and its applicable Attachments and Transaction Documents are
the complete agreement regarding this transaction, and replaces any prior
oral or written communications between us.
By signing below for our respective Enterprises, each of us agrees to the
terms of this Agreement.
Once signed,
1) any reproduction of this Agreement, an Attachment, or Transaction
Document made by reliable means (for example, photocopy or facsimile)
is considered an orginal and
2) all Services and Products you order under this Agreement are subject
to it.
AGREED TO: QCS CORPORATION AGREED TO: IBM CORPORATION
BY: /s/ [illegible] BY: /s/ [illegible]
--------------------------- ---------------------------
QCS
AUTHORIZED SIGNATURE AUTHORIZED SIGNATURE
NAME (PRINT): [illegible] NAME (PRINT): [illegible]
------------------ ------------------
DATE: 11/23/96 DATE: 10:27AM 11/23/96
After signing, please return a copy of this Agreement to the following
address:
IBM Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
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TABLE OF CONTENTS
Section Title Page
------- ----- ----
Part 1 - General 4
1.1 Definitions 4
1.2 Agreement Structure 5
1.3 Electronic Communications 5
1.4 Prices and Price Changes 5
1.5 Invoicing, Payment, and Audit 5
1.6 Patents and Copyrights 6
1.7 Limitation of Liability 6
1.8 Your Additional Rights 7
1.9 Changes to and Termination of Services 7
1.10 Changes to the Agreement Terms 7
1.11 Agreement Termination 7
1.12 Geographic Scope 8
1.13 Governing Law 8
1.14 Notice 8
Part 2 - Responsibilities of the Parties 8
2.1 Mutual Responsibilities 9
2.2 Our Responsibilities 9
2.3 Your Other Responsibilities 9
Part 3 - Warranties 10
3.1 The IBM Warranties 10
3.2 Extent of Warranty 10
3.3 Items Not Covered by Warranty 10
Part 4 - Equipment Provided by IBM 10
Part 5 - Customer Transmitted Data 11
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QCS has a Lotus Notes-based multimedia software product which links Retailers
with their Suppliers in many locations offering a "business to business"
retail services network. IBM has an extensive worldwide marketing base which
includes Retailers, and the ability to provide networking services through
the IBM InterConnect Service for Lotus Notes. QCS and IBM have decided
therefore to work together as provided in this Agreement in order to deliver
a service which links Retailers with their Suppliers worldwide, and have
agreed to the following:
PART 1 - GENERAL
1.1 DEFINITIONS
"AGREEMENT" shall mean this Agreement, together with any applicable
Attachments and/or Transaction Documents.
"END USER" is any party whom you authorize, by any means, for example, a
USER IDENTIFICATION, to access the Service. It also means any party whom you
authorize to access programs, data, or equipment within the Service.
"ENTERPRISE" is any legal entity (such as a corporation) and the
subsidiaries it owns by more than 50 percent.
"EQUIPMENT" is a machine, its features, conversions, upgrades, elements, or
accessories, or any combination of them. The term "Equipment" includes IBM
Equpiment and any non-IBM Equipment we may provide to you.
"MATERIALS" are work product (such as programs, program listings,
programming tools, documentation, reports, and drawings) that we may deliver
to you during a project. The term MATERIALS does not include Programs.
"PRODUCT" is a Program or Equipment.
"PROGRAM" is the following, including features and any whole or partial
copies:
1. machine-readable instructions;
2. a collection of machine-readable data, such as a database; and
3. related licensed materials, including documentation and listings, in
any form.
The term PROGRAM includes an IBM Program and any non-IBM Program that we may
provide to you. The term does not include licensed internal code or
MATERIALS.
"SERVICES" are described in the applicable Transaction Documents and
include access to, and use of, Equipment, Programs, networking facilities,
and associated enhanced communication and support services. Except for the
right to use programs that we authorize you to access through the Services,
we grant no other rights to those programs to you or End Users. Initially,
the "IBM InterConnect for Lotus Notes" Service described in the Exhibit 01
hereto is made part of this Agreement.
"START DATE" of a Service is the day on which we make it available to you.
"SYSTEM" is the Services and Products we provide together under this
Agreement that we identify to you as a "System."
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1.2 AGREEMENT STRUCTURE
ATTACHMENTS
Some Services and Products have terms in addition to those we specify in
this Agreement.
We provide the additional terms in documents called "ATTACHMENTS," which
are also part of this Agreement. For example, we may describe the additional
terms for Programs in an Attachment. We make the Attachments available to you
for signature.
TRANSACTION DOCUMENTS
For each business transaction, we will provide to you the appropriate
"TRANSACTION DOCUMENT(S)" that confirm the details of the transaction. Some
Transaction Documents require signature, and others do not. Supplements are
an example of Transaction Documents that must be signed by both of us.
Supplements may contain descriptions of custom solutions and associated
special charges or descriptions of project schedules, responsibilities, and
associated charges. Exhibits and Fee Schedules are unsigned Transaction
Documents that explain in detail standard Services, Programs, and
associated charges. Initially Supplement 01 and Exhibit 01 are made a part
of this Agreement.
CONFLICTING TERMS
If there is a conflict among the terms in the various documents, those of
an Attachment prevail over those of this Agreement. The terms of a
Transaction Document prevail over those of both of these documents.
1.3 ELECTRONIC COMMUNICATIONS
Each of us may communicate with the other by electronic means, such as IBM;
Mail Exchange and Information Exchange. Each of us agrees to the following
for all electronic communications:
1. a User Identification contained in an electronic document is legally
sufficient to verify the sender's identity and the document's
authenticity;
2. an electronic document that contains a User Identification is a
signed writing; and
3. an electronic document, or any computer printout of it, is an original
when maintained in the normal course of business.
1.4 PRICES AND PRICE CHANGES
The payment terms and conditions described in: (i) Section 3, entitled
"Set-up Costs and Frame Relay Surcharges" of Exhibit 01; and (ii) Section
2, entitled "Revenue Based Payments" of Supplement 01 sets forth our
payment and price terms and are made part of this Agreement.
1.5 INVOICING, PAYMENT AND AUDIT
Payments shall be made monthly and shall be deemed to be made on the date
of electronic funds transfer to the following IBM account of amounts due.
Account information such as account number, identification codes and
address, will be provided with 30 days after the Effective Date.
QCS will maintain relevant records to support payments made to IBM and to
demonstrate to IBM that QCS has otherwise complied with this Agreement. QCS
will retain and make available such records for three (3) years from the
date of the related transaction or payments. If IBM requests, QCS will make
financial records available to an independent auditor chosen and
compensated by IBM. IBM's requests will be in writing and will not occur
more than twice each year. The auditor will sign a confidentiality
agreement and will only disclose to IBM any amounts due and payable for the
period examined.
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If an audit discovers that QCS underpaid IBM, QCS will pay the amount due
plus interest. Interest accrues from the payment due date. The interest
rate is the lower of two percent (2%) per month or the highest interest
rate allowed by law. If QCS underpaid IBM by more than five percent (5%).
QCS will immediately reimburse IBM for all expenses associated with the
audit. IBM may also have other remedies under the law and this Agreement.
1.6 PATENTS AND COPYRIGHTS
For purposes of this Section only, the term "Product" includes Materials
alone or in combination with Products we provide to you as a System.
If a third party claims that a Product we provide to you infringes that
party's patent or copyright, we will defend you against that claim at our
expense and pay all costs, damages, and attorney's fees that a court
finally awards, provided that you:
1. promptly notify us in writing of the claim; and
2. allow us to control, and cooperate with us in, the defense and any
related settlement negotiations.
If such a claim is made or appears likely to be made, you agree to permit
us to enable you to continue to use the Product, or to modify it, or
replace it with one that is at least functionally equivalent. If we
determine that none of these alternatives is reasonably available, you
agree to return the Product to us on our written request and we may
terminate the affected Service.
This is our entire obligation to you regarding any claim of infringement.
NOTICE OF INFRINGEMENT
All notices of patent or copyright infringement permitted or required by
this Agreement will be in writing, will be sent to the following address,
and will take effect upon receipt.
IBM Corporation
Internet Division Counsel
Xxxxx 000, Xxx 000
Xxxxxx, XX 00000
CLAIMS FOR WHICH WE ARE NOT RESPONSIBLE
We have no obligation regarding any claim based on any of the following:
1. your modification of a Product, or a Program's use with equipment and
programs other than the Equipment and Programs with which the Program
is designed to operate;
2. the combination, operation, or use of a Product with any product,
data, or apparatus that we did not provide; or
3. infringement by a non-IBM Product alone, as opposed to its combination
with Products we provide to you as a System.
1.7 LIMITATION OF LIABILITY
Circumstances may arise where, because of a default on our part or other
liability, you are entitled to recover damages from us. In each such
instance, regardless of the basis on which you are entitled to claim
damages from us, we are liable only for:
1. payments referred to in our patent and copyright terms described above;
2. bodily injury (including death), and damage to real property and
tangible personal property; and
3. the amount of any other actual loss or damage, up to the greater of
$100,000 or the charges (if recurring or usage, 12 months' charges
apply) for the Service or Product that is the subject of the claim.
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This limit also applies to any of our subcontractors and Program
developers. It is the maximum for which we are collectively responsible.
ITEMS FOR WHICH WE ARE NOT LIABLE
Under no circumstances are we, our subcontractors, or Program developers
liable for any of the following:
1. third-party claims against you for losses or damages (other than those
under the first two items listed above);
2. loss of, or damage to, your records or data; or
3. economic consequential damages (including lost profits or savings) or
incidental damages, even if we are informed of their possibility.
1.8 YOUR ADDITIONAL RIGHTS
You may have additional rights under certain laws (such as consumer laws)
which do not allow the exclusion of implied warranties, or the exclusion or
limitation of certain damages. If these laws apply, our exclusions or
limitations may not apply to you.
1.9 CHANGES TO AND TERMINATION OF SERVICES
We will give you three months' written notice if we increase Service
charges or change invoicing procedures, or when a planned change would
substantially alter a Service from its current description. We will give
you 12 months' written notice if we terminate a Service (or if we change
this 12-month notice period). However, if a third party claims that a
Product we provide as part of a Service infringes a patent or copyright, we
reserve the right to terminate the Service effective immediately.
1.10 CHANGES TO THE AGREEMENT TERMS
In order to maintain flexibility in our Services, Products, and options, we
may change the terms of IBM's standard Services Agreement by giving you
three months' written notice. However, these changes are not retroactive.
They apply, as of the effective date we specify in the notice, only to new
orders (those we receive on or after the date of the notice) and to
on-going transactions, such as licenses and Services.
Otherwise, for a change to be valid, both of us must sign it. Additional
or different terms in any order or written communication from you are void.
1.11 AGREEMENT TERMINATION
Subject to the next sentence, either party may, for its convenience,
terminate this Agreement upon ninety (90) days' written notice to the other
party. However, IBM will give you 12 months' written notice if such
termination for convenience is based on the termination of the Service (or
if we change this 12-month notice period). This Agreement will terminate
either on the date specified in the notice, which shall be in compliance
with the time periods for notice contained in this Section, or at a
later date specified in the notice. Upon the receipt of notice of
termination, the parties will stop work under this Agreement in an orderly
manner and return the other's property in its possession, less one (1)
archival copy of any Code delivered to the other party, including QCS
Software solely for dispute resolution and internal account record purposes
for a period not to exceed three (3) years, and which will be treated as
confidential information pursuant to the terms of our Agreement for
Exchange of Confidential Information for the entire period of such use.
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Notwithstanding the foregoing, if QCS terminates, QCS' obligations
contained in the "Revenue Based Payments" Section of Supplement 01, shall
survive and continue, as provided in that Section.
If IBM terminates for convenience, IBM will receive no share of Revenue
earned after the date of termination, and QCS will pay IBM 100% of its
share of the revenue through the date of termination.
Either party may terminate this Agreement for cause, effective on receipt
of notice to the other party, when that other party:
a) becomes insolvent;
b) becomes the subject of any proceedings seeking relief,
reorganization, receivership or rearrangement under any laws relating
to insolvency;
c) makes an assignment for the benefit of creditors;
d) begins the liquidation, dissolution or winding up of its business;
e) consolidates, merges, sells, leases, exchanges or transfers 50% or
more of its assets or otherwise changes control without IBM's consent
which shall not be unreasonably withheld unless such a change of
control involves an entity engaged in similar activities as IBM's
contemplated activities under by this Agreement, in which case, IBM's
consent shall be in IBM's sole and absolute discretion;
f) commits a material breach which is not remedied within 30 days after
notice, such as continued failure to make payment or knowing
violation of intellectual property rights.
The parties will promptly apprise each other if any such cause appears
imminent.
Termination of this Agreement does not affect previously granted paid-up
rights and licenses to Retailers and Suppliers authorized by this Agreement.
Any terms of this Agreement that by their nature extend beyond its
termination (for example, with respect to Revenue, Intellectual Property,
Indemnification, Limitation of Liability and Term and Termination) will
survive. These terms will apply to either party's successors and assigns.
1.12 GEOGRAPHIC SCOPE
All your rights, all our obligations, and all obligations are valid only in
the country in which the transaction is performed or, if we agree, the
country where the Product is placed in productive use, except that all
licenses are valid as specifically granted.
1.13 GOVERNING LAW
The laws of the State of New York govern this Agreement. The parties hereby
expressly waive any right to a jury trial and agree that any action to
resolve disputes relating to this Agreement shall be tried by a judge
without a jury and that any proceeding, counterclaim or action arising out
of or from this Agreement shall be commenced in the state of New York. The
United Nations' Convention on International Sale of Goods does not apply.
1.14 NOTICE
All notices permitted or required by this Agreement, except for notices of
patent and copyright infringement which will be sent to the address
specified in section 1.6, "Patents and Copyrights," will be sent to the
following address and will take effect upon receipt:
IBM Corporation
Internet Division Counsel
Xxxxx 000, Xxx 000
Xxxxxx, XX 00000
PART 2 - RESPONSIBILITIES OF THE PARTIES
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2.1 MUTUAL RESPONSIBILITIES
Each of us agrees that under this Agreement:
1. neither of us grants the other the right to use its trademarks, trade
names, or other designation in any promotion or publication, other
than as provided in this Agreement or in the Transaction Documents;
2. all information exchanged by both of us is nonconfidential unless
covered by a signed confidentiality agreement or as otherwise
provided in this Agreement or in the Transaction Documents. Part 5 of
this Agreement describes our responsibilities for handling data and
information you transmit using the Services;
3. each is free to enter into similar agreements with others provided no
conflict exists between such agreements and this Agreement;
4. each grants the other only the licenses specified. No other licenses
(including licenses under patents) are granted;
5. each will promptly notify the other if it becomes aware of any unsafe
conditions or hazardous materials to which the other's personnel
would be exposed at any of its facilities;
6. neither of us will bring a legal action more than two years after the
cause of action arose; and
7. neither of us is responsible for failure to fulfill its obligations
due to causes beyond its control.
2.2 OUR RESPONSIBILITIES
We will:
1. inform you of Service descriptions, charges, discounts, allowances,
and other terms in Transaction Documents;
2. provide to you necessary User Identifications to enable access to the
Services and;
3. perform in accordance with the obligations set forth in the
Transaction Documents.
2.3 YOUR OTHER RESPONSIBILITIES
You agree:
1. not to assign, or otherwise transfer, this Agreement or your rights
under it, delegate your obligations, or resell any Service, without
prior written consent. Any attempt to do so is void;
2. to allow us to install mandatory engineering changes (such as those
required for safety) on Equipment;
3. that you are responsible for the results obtained from the use of the
Services and Products;
4. to provide us with sufficient, free, and safe access to your
facilities for us to fulfill our obligations;
5. to control and be responsible for User Identifications and their
distribution to End Users;
6. to obtain, install, and maintain suitable equipment as necessary to
access the Services;
7. to comply with all applicable laws, regulations, or conventions
including those related to data privacy, international
communications, and exportation of technical or personal data. You
are responsible for obtaining all necessary governmental, regulatory,
or statutory approvals for your use of the Services;
8. to obtain all required permissions if you use a Service to copy,
download, display, distribute, or execute programs or perform other
works;
9. to be responsible for data, programs, or other material that you
provide for use with a Service, and ensure that
1) we do not violate anyone's rights in providing the Service, and
2) the disclosure or use of the material through the Service does
not breach any contractual relationship;
10. to inform, in writing, those whom you authorize to access a Service,
of the applicable terms of the Agreement and that we have no
liability to them. You may use the name "IBM" when informing them
that your products are available through the Services; and
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11. to authorize us to include your name, contact information, and other
mutually-agreed-to information in a directory of IBM customers,
unless you notify us otherwise in writing within one month of your
first order for the Services.
PART 3 - WARRANTIES
3.1 THE IBM WARRANTIES
Warranty for IBM Services
For each IBM Service, we warrant that we perform it:
1. in a workmanlike manner; and
2. according to its current description contained in this Agreement, an
Attachment, or a Transaction Document.
Warranty for IBM Programs
We specify the warranty for warranted IBM Programs in an Attachment.
Warranty for Systems
Where we provide a System (for example, when we provide Services, Equipment,
and Programs according to our marketing proposal), we warrant that its
components are compatible and will operate with one another. This warranty
is in addition to our other applicable warranties.
3.2 EXTENT OF WARRANTY
Misuse, accident, modification, unsuitable physical or operating
environment, operation with equipment and programs other than the Equipment
and Programs with which a Program is designed to operate, improper
maintenance by you, or failure caused by a product for which we are not
responsible, may void the warranties.
THESE WARRANTIES REPLACE ALL OTHER WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE.
3.3 ITEMS NOT COVERED BY WARRANTY
We do not warrant uninterrupted or error-free operation of a Service or
Product.
We will identify IBM Services and Products that we do not warrant.
Unless we specify otherwise, we provide Materials, non-IBM Services and
non-IBM Products on an "AS IS" basis. However, non-IBM manufacturers,
suppliers, or publishers may provide their own warranties to you.
PART 4 - EQUIPMENT PROVIDED BY IBM
We may provide Equipment to be installed on your premises for the purpose
of providing a Service. The Equipment is and will remain the asset of IBM or
its lessor and will not become a fixture or realty.
Certain Equipment may contain licensed internal code. We will identify this
Equipment to you.
No right, title, or interest in or to the Equipment, or licensed internal
code associated with it, or any related planning information, is passed to
you. However, we will use such Equipment to provide Services to you.
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As appropriate, we will provide you physical planning information for the
Equipment. You agree to comply with that information in order to provide an
environment meeting our specifications.
OUR RESPONSIBILITIES
We will:
1. install the Equipment we provide at your site unless we specify
otherwise;
2. maintain the Equipment; and
3. be responsible for all return, removal, and shipping charges for the
Equipment.
YOUR RESPONSIBILITIES
You agree to:
1. provide and pay for the physical space and electrical power for the
Equipment at your site;
2. be responsible for loss of or damage to the Equipment caused by your or
your employees' or your agents' intentional acts or negligence;
3. provide us or our designee with all assistance reasonably necessary to
permit us access to your site to perform inspection, installation,
preparation for return, or maintenance as is appropriate;
4. provide at no cost to us, adequate security to protect the Equipment
from theft, loss, damage, or misuse;
5. return to us, or permit us or our designee to remove at our discretion,
the Equipment, any licensed internal code associated with it, and
physical planning documentation at the expiration or termination of
the Service;
6. not alter the Equipment in any manner, not move it to other locations,
and not transfer it to anyone else without our prior written approval;
7. keep the Equipment free from all liens, charges, or encumbrances; and
8. affix and keep in a prominent place on the Equipment any marking or
label we require.
PART 5 - CUSTOMER TRANSMITTED DATA
We agree not to disclose your confidential information, including programs
and data, transmitted using the Services. However, we have no obligation of
confidentiality relating to your information, including programs and data,
which is not confidential. Information that is not confidential includes
information which is:
1. either currently publicly available or becomes publicly available in
the future without our breach of any obligation or responsibility
described in this Agreement;
2. rightfully received by either of us from a third party, where the
information was received without any obligation of confidentiality
associated with it;
3. already in our possession without an obligation of confidentiality;
4. independently developed by us;
5. approved for disclosure by you; or
6. treated by you as nonconfidential.
We also have no liability for any disclosure of information that occurs as
the result of our delivery of your information, at your direction and to a
recipient you designate, when the delivery is made in the normal course of
Service provision (for example, to an incorrect delivery address provided
by you to us). We may disclose information to the extent required by law.
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Handling of your information
You are responsible for selection and use of the security facilities and
options that we provide.
You are responsible to develop and maintain procedures (apart from the
Services) to protect your information. You are responsible for backup and
restoration of your information.
For the purposes of operation and maintenance we may use, copy, display,
store, and distribute internally your information. We agree not to reverse
assemble or reverse compile your information.
We do not guarantee that these procedures will prevent the loss of,
alteration of, or improper access to, your information. You agree that
access to your information will not prohibit or prevent us from developing
or marketing any Service or Product.
For transmission carried over interexchange carriers' and local exchange
carriers' facilities, IBM is not responsible for transmission errors, or
corruption or security of data.
We reassign to other customers data storage that you return to us. We do
not erase data storage and, in some cases, the next customer accessing a
disk may be able to read residual data. We are not responsible for your
failure to erase sensitive data from disk space returned to us.
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EXHIBIT 01 TO THE SERVICE AGREEMENT BETWEEN IBM CORPORATION AND QCS
CORPORATION DATED NOVEMBER 23, 1996
IBM INTERCONNECT FOR LOTUS NOTES EXHIBIT
THE TERMS OF THE AGREEMENT APPLY TO THIS EXHIBIT
1. BACKGROUND
Under the terms of this Exhibit, we provide to you the "Basic Offer" version
of IBM InterConnect for Lotus Notes Service (the "Service"). As part of this
Service, IBM Corporation, or its suppliers ("we" or "us") will provide QCS
Corporation ("you") space on our premises where your Lotus Notes applications
and data bases will be resident and can be accessed by both you and users
within your enterprise that you authorize. Additionally, the Service provides
your authorized users with the capability to perform selected Lotus Notes
functions. We provide you the use of the facilities under this Service,
including those for loading, replicating and maintaining your applications
and data bases, through a dial connection to the Service in the United
States. We restrict the use of the facilities under this Service to your
Lotus Notes administrator and to Lotus Notes client IDs and users whom your
administrator has certified (and to whom your administrator has provided the
appropriate network connection scripts).
Access to this Service is available through selected networks that are
interconnected to the Service. Network interconnect access availability is
subject to change without prior notice.
If either party terminates this Service, we will return to you your
information and data content. We reserve the right to maintain one copy for
archival purposes only, solely for dispute resolution and internal account
record purposes for a period not to exceed three (3) years, and which will be
treated as confidential information pursuant to the terms of our Agreement for
Exchange of Confidential Information for the entire period of such use.
Both of us agree that neither party is a legal representative, partner, joint
venturer, franchisee, or agent for any purpose of the other, unless both
parties have signed a separate written business partner agreement. Other than
as specified in this Exhibit or the Agreement, neither party makes any
representations, or assumes or creates any obligations, on behalf of the
other.
OUR RESPONSIBILITIES
We provide the hardware and software on our premises and the network
connectivity, and are responsible for maintaining the Service and its
operational status in support of your applications and data bases that are
resident on our premises. We are responsible for licensing the software that
we provide. We, in our sole judgment, provide the hardware, software and
network connectivity we deem appropriate.
We are responsible for maintaining the network interconnect access, which is
subject to change without prior notice. We will provide you a list of current
interconnected networks upon request.
We will provide you with an "800" number for help desk support solely
related to the Service.
YOUR RESPONSIBILITIES
You are responsible for the evaluation, selection, authorization, use and
results obtained from the Lotus Notes security facilities and security
procedures provided under this Service.
You are responsible for providing your own servers and/or workstations on
your premises and for licensing, installing and maintaining on your servers
and/or workstations the Lotus Notes program.
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Your are responsible for invoicing and collecting any fees which you charge
to users that access your information and data content.
You shall not use this Service to send or receive any information in the form
of text, graphics, or programs (whether or not provided by IBM) which
infringes any patent, copyright, trademark, trade secret, or other
intellectual property right, or any privacy or similar right of another.
Immediately upon written notice we may terminate your authorization to
maintain your information and data on our facilities if you infringe any
intellectual property right, copyright, patent, trademark, privacy right, or
similar right of another in conjunction with the information and data content
you provide.
You are responsible for promptly notifying us of any event or circumstance,
and will provide all information relating to such event or circumstance if
requested by us, related to this Service or your information and data which
could lead to a claim or demand against us by any third party.
You are solely responsible for the accuracy of all your information and data
content, including but not limited to the applications and data bases you
place or have placed on the Service. You are responsible for ensuring that
your information and data content does not violate any law or regulation.
You will:
1. be solely responsible for those who you permit to make
modifications to your information and data, and any content
contained therein, including but not limited to the accuracy
and availability of the information and data content you provide
to your users; and
2. provide assistance to those who access your information and data
content regarding its use.
INDEMNIFICATION
You shall defend, indemnify, and hold us harmless against any liabilities
arising out of: a) any injury to persons or property caused by any item sold
or advertised in connection with your information and data, b) any claim that
any item sold or advertised in connection with your information and data does
not comply with all local and international safety and labeling requirements
and all other relevant local and international laws, treaties, regulations,
ordinances, and the like, c) any defamatory, libelous or illegal, or
allegedly defamatory, libelous or illegal material contained within your
information and data, d) any material infringing or allegedly infringing on
the proprietary rights (including but not limited to intellectual property
rights) of a third party, e) any third party claim arising out of third party
access or use of your information and data, and f) any claim by you that your
data was compromised because of a failure to provide adequate security.
THIRD PARTY SOFTWARE
All third party software used to provide this Service is provided "as is."
Notwithstanding Section 1.6, "Patents and Copyrights," of the Agreement, we
do not provide you with any patent or copyright indemnification with regard
to such third party software.
AVAILABILITY
Our objective is to make this Service available 24 hours per day 7 days per
week except for scheduled maintenance. Maintenance is currently scheduled
daily. However, access to the Service may be dependent upon resources not
under the control of IBM. We reserve the right to interrupt the Service to
perform emergency maintenance as needed.
2. INTERCONNECT BASIC OFFER - SERVICE: DETAILED DESCRIPTION
The Service provided to you hereunder is the "Basic Offer" of the IBM
InterConnect for Lotus Notes Service only and is made up of the following
components, each of which is discussed in detail below:
- Transport
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- Network and Server Management
- Performance Management
- Security
- Mail & Replication Services
- Implementation Support
- Help Desk Support
- Administrator Registration
- Set-up Costs and Frame Relay Surcharges
TRANSPORT
FLEXIBLE ACCESS OPTIONS: Access to the Service is available through a
variety of IBM options. IBM will help QCS determine the best access method
for each specific location.
DIAL-UP ACCESS: Dial-up access to the Service is available through a
Global X.25 network. IBM provides a local dial node or 800 number by which a
customer can establish a dialed modem connection. The network works with all
modem manufacturers at a variety of speeds. The current maximum supported
rate is [*] . QCS will provide its own analog phone line and
modem to access the network. Note: Mobile or remote endpoints running Notes
release 3.X typically use the X.PC protocol provided in Lotus Notes to
connect with the Service's server complex.
DEDICATED ACCESS: Customers may also select a dedicated frame relay
connection from the IBM frame relay service. This service provides greater
bandwidth, with speeds of up to [*]
SLIP/PPP (IP) ACCESS: IBM will also offer PPP and SLIP dial in the
future. The release 3.X client of Lotus Notes requires an external utility to
establish the PPP connection, but this feature is built into Lotus Notes
Release 4.
NETWORK MANAGEMENT
TWENTY-FOUR HOUR NETWORK SURVEILLANCE: IBM provides 7x24 coverage of
the Service's access facilities to ensure maximum availability of the
Service's environment. Network services are proactively monitored for alarms
(faults).
NETWORK LOAD BALANCING: IBM will analyze the Service's network
configuration to assure maximum utilization of access facilities.
NETWORK REDUNDANCY: The Service utilizes "the best of breed" Global
X.25 and Frame Relay networks available. The redundant routing and
intelligent networking built into these networks ensures the highest
availability and quality.
NETWORK CAPACITY MANAGEMENT: IBM proactively monitors network
utilization to ensure that appropriate capacity is available for QCS'
networking needs. If deficiencies are detected, IBM will contact QCS and take
appropriate steps to remedy the situation.
SERVER MANAGEMENT
STORAGE: IBM provides customers with 500 megabytes in the basic offer
and options in increments of 1 gigabyte of disk space for storage of QCS'
information.
MIRRORED DISKS: IBM utilizes mirrored disks to assure the integrity of
QCS' data and to prevent loss of information.
NIGHTLY BACKUPS: IBM performs regularly scheduled nightly backups of
QCS' data to provide a recovery source in case of data corruption.
[*] CONFIDENTIAL PORTIONS OMITTED AND FILED SEPARATELY WITH COMMISSION
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SERVER CAPACITY MANAGEMENT: IBM proactively monitors the Service's
servers to help assure that adequate disk space and simultaneous user
capacity is available to support the QCS' data requirements.
LOAD BALANCING: IBM provides proactive monitoring of the Service's
server environment. Additional servers may be added to ensure appropriate
application performance.
SURVEILLANCE AND MAINTENANCE: IBM provides proactive, 7 x 24
surveillance and maintenance of the Service's server environment. This
includes monitoring server tasks and alarms to assure smooth and efficient
operations.
SECURITY MANAGEMENT
DIAL-UP LOG-IN AND PASSWORD: The Service users who access the service
via dial-up connection use a pre-scripted log-in, password and user
authentication for security purposes. This dial-up security supplements the
security inherent in Lotus Notes that is, Access Control Lists (ACLs), user
authentification and RSA encryption.
APPLICATION FILTERING: Customers who access the Service via frame
relay have the option of added security of specially administered routers
that filter non-Notes messages. Such filters exclude non-Notes messages or
data (such as Telent or FTP) from the Service's network.
SECURE IBM SERVER COMPLEX: IBM takes several measures to help keep
its server complex as physically secure as possible. The Service's server
complex is located in a data center in which access is restricted to
operational personnel.
MAIL & REPLICATION SERVICES
MAIL: Intra and Inter-domain Notes mail is managed via the Service's
server environment. IBM provides the transport, directory and server
environment to support intra-domain mail and inter-domain Notes mail.
INTER- AND INTRA-DOMAIN REPLICATION: The Service provides a secure
environment for replication between and among domains. The replication
schedule, domain environment and communications (if required) are managed by
IBM. Inter-domain replication is available.
MAIL GATEWAY: Mail can be sent to the Internet through a SMTP
(Simplified Mail Transfer Protocol) gateway. Binary attachments to mail are
supported through MIME (Multi-purpose Internet Mail Extension).
HELP DESK SUPPORT
NOTES END USER SUPPORT: IBM provides multinational and multilingual
support for Lotus Notes End Users. Domestic support is provided on a 24x7
basis. International support is available during business hours in the
following languages: French, German, Italian and Spanish.
NETWORK TROUBLE HOTLINE: IBM provides a toll-free hotline for server
complex-related problem resolution. All network or server complex problems
are solved free-of-charge.
NOTES ADMINISTRATOR SUPPORT VIA PHONE: IBM provides Notes and network
technical support via phone seven days per week, 24 hours per day.
TROUBLE TICKET SYSTEM: The IBM Trouble Ticket System allows customer
problems to be tracked from initial report through satisfactory resolution.
As IBM staff works to resolve problems, current status is updated in the
Trouble Ticket System. This allows IBM staff to discuss ticket history with
customers if required.
FAULT ISOLATION AND PROBLEM RESOLUTION: Fault isolation involves
coordination among network operations and technical staff. Depending on the
QCS' specific configuration, line testing and router reconfiguration may be
used. The IBM staff works to pinpoint problems, track repair progress and
resolve problems.
INTERNATIONAL SUPPORT
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Access numbers, hours of availability and native language support will vary
based on geography. In all cases, an option will be available after hours to
call into the domestic support center for support in English.
LOCATION LANGUAGE TELEPHONE # SUPPORT HOURS
International English 000-000-0000 7 x 24
Canada English 000-000-0000 7 x 00
Xxxxxx French 00-0-0000-0000 9:00AM-6:00PM M-Th 9:00AM-
5:30PM F
Germany German 00-00-0000-0000 8:30AM-5:30PM M-F
Italy Italian 00-0-0000-0000 9:00AM-6:00PM M-Th 9:00AM-
5:30PM F
Latin America Spanish 000-000-0000 8:30AM-5:30PM M-F
7 x 00
Xxxxxxx
Xxxxx Xxxxxxx Spanish 000-000-0000 8:30AM-5:30PM M-F
7 x 24
English
Spain Spanish 00-0-0000-0000 9:00AM-6:00PM M-Th 9:00AM-
5:30PM F
UK English 00-000-0000000 9:00AM-5:30PM M-F
USA English 000-000-0000 7 x 24
IMPLEMENTATION SUPPORT
IMPLEMENTATION SUPPORT SERVICE
The InterConnect Implementation Support Service helps to assure that
each End Point is registered and successfully connects to QCS' InterConnect
application. It facilitates rapid deployment of the customers IBM-based
solution.
ENDPOINT IMPLEMENTATION SUPPORT: The End Point enablement service
provides customers with the basic support necessary to get End Points
registered on the Service. IBM provides direct End Point support via phone to
assure the first successful connection and replication to QCS' IBM-based
application. The End Point enablement is offered on a 24x7 basis and is free
of charge.
QCS is responsible for contacting each Retailer endpoint to assess
each End Point's interest and readiness to engage in the Service. QCS is
responsible for sending InterConnect Registration and Welcome Kit materials to
each Retailer endpoint. QCS is also responsible for providing any necessary
hardware, software or analog phone services necessary to bring the End Point
up on InterConnect.
IBM is responsible for contacting each Supplier endpoint to assess
each End Point's interest and readiness to engage in the Service. IBM is
responsible for sending InterConnect Registration and Welcome Kit materials
to each Supplier endpoint. IBM is also responsible for providing any
necessary hardware, software or analog phone services necessary to bring the
End Point up on InterConnect.
ADMINISTRATOR REGISTRATION
INSTALLATION MANAGEMENT: IBM will work with QCS' designated
InterConnect administrator to assure that initial implementation of QCS' IBM
InterConnect for Lotus Notes server and transport meets scheduled due dates.
QCS' IBM InterConnect for Lotus Notes server will be provisioned, databases
loaded and transport ordered and provisioned according to QCS'
specifications. QCS will be notified if dates are in jeopardy.
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ADMINISTRATOR REGISTRATION: IBM will work with QCS' designated
InterConnect administrator to assure proper cross certification and
registration. QCS' designated InterConnect administrator is responsible for
registering all other administrators and End Points. QCS' designated
InterConnect administrator is required to have a Lotus Notes workstation and
access to the network in order to perform InterConnect registration duties.
COORDINATE INITIAL TEST AND TURN-UP: IBM will work with QCS'
designated InterConnect administrator to ensure successful access to and
connection with the Service once registration has been completed. QCS'
designated InterConnect administrator is responsible for working with each
additional administrator to assure successful test and turn-up.
PROVIDE WELCOME KITS: IBM will provide two versions of IBM
InterConnect for Lotus Notes Welcome Kits to QCS' designated InterConnect
administrator; an administrator version and an End Point version. It is the
responsibility of QCS' designated InterConnect administrator to distribute
End Point welcome kits. Welcome kits contain dial-up connect scripts and safe
IDs.
ADMINISTRATOR TRAINING CALL: IBM conducts one free IBM InterConnect
for Lotus Notes administrator training call per customer. The purpose of this
call is to give QCS' administrator the training necessary to act as a central
point of contact for all customer registration and initial connectivity
needs. It is assumed that QCS' designated InterConnect administrator has
attended the Lotus Notes Systems Administration I and II courses provided by
Lotus and/or its designated training providers.
AUTOMATED REGISTRATION TOOL: IBM provides tools for QCS'
administrator which will enable him/her to add or delete the Service's End
Points; to create, delete or modify the Service's Group Lists; to add another
administrator; and to add and delete databases from the Service.
3. SET-UP COSTS AND FRAME RELAY SURCHARGES
A. In addition to payments and price terms as may be specified elsewhere in
the Agreement, QCS shall make the following payments to IBM in the first
billing month after the Effective Date:
Set up fee - which includes server installation, End Point enablement, domain
registration and help desk registration.
COMPONENT ONE TIME COST
Enterprise setup fee [*]
B. QCS shall also pay IBM additional "Frame Relay Surcharges" as specified in
invoices or similar documents, as follows:
SPEED MONTHLY COST
[*]
Frame Relay Network Charges - based on bandwidth and distance from Point of
Presence
[*] CONFIDENTIAL PORTIONS OMITTED AND FILED SEPARATELY WITH COMMISSION
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You will initially be provided with 500 megabytes of storage capacity as part
of the Service. Additional units of storage will be made available to you in
increments of 1 gigabyte (GB) for an additional charge of [*] .
Requests for additional storage will require a minimum of thirty (30) days
written notice and are subject to availability.
IBM is a registered trademark of the International Business Machines
Corporation. Lotus and Lotus Notes are registered trademarks of the Lotus
Development Corporation.
Exhibit 1 11/23
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SUPPLEMENT 01 TO THE SERVICE AGREEMENT BETWEEN IBM CORPORATION AND QCS
CORPORATION DATED NOVEMBER 23, 1996 (THE "AGREEMENT")
The Parties agree that for good and valuable consideration, the sufficiency
of which the parties hereby acknowledge, the following terms and conditions
shall apply to the Agreement.
1) DEFINITIONS
a) "CONSUMER" is a member of the public who purchases goods and/or services
from a Retailer.
"EFFECTIVE DATE" is the later date on which both IBM and QCS have signed
this Agreement or December 2, 1996.
"END POINT" is the point of contact with the IBM network (it may be a
workstation with a single user, a mobile workstation or a server on a LAN
with many users behind it). End Points run__________ QCS Lotus Notes based
software.
"END USER" is an individual who employs the QCS Lotus Notes based software
for his or her business purposes.
"EXISTING SUPPLIERS" are those Suppliers which have licensed the QCS Lotus
Notes based software and are connected to the QCS server as of the Effective
Date.
"NETWORK SERVICE PROVIDER" is the IGN network service provided by IBM or
"Other" network services provided by SITA and/or AT&T.
"RETAILER" is an entity that sells goods and/or services to Consumers.
This definition includes the associated units of a Retailer. A Retailer is
not a government agency.
"SUPPLIER" is an entity that primarily sells goods to a Retailer and/or to
another Supplier. A Supplier is not a government agency.
"SUPPLIER LEVEL" shall mean a number of Suppliers equal to one hundred
fifty percent (150%) of the Existing Suppliers.
"QCS SOFTWARE" is QCS' Lotus Notes-based multimedia software provided to
IBM under this agreement. QCS Software may be Supplier, Retailer, or other
End-User designated, or may be that which QCS provides to IBM for
installation on the Service.
b) The following terms shall be used to describe QCS' revenue sources which
are the basis for revenue based payments under the Agreement:
[*]
[*] CONFIDENTIAL PORTIONS OMITTED AND FILED SEPARATELY WITH COMMISSION
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[*]
2) REVENUE BASED PAYMENTS
REVENUE BASED PAYMENTS FORMULA:
In exchange for providing the Service specified in Exhibit 01, and for the
mutual obligations set forth in the Agreement as of the Effective Date, QCS
shall make payments to IBM as follows:
NETWORK PAYMENT
REVENUE SERVICE TO
SOURCE PROVIDER IBM SPECIAL RULES
[*]
*percentages shall be of contracted revenue collected by or for QCS for the
applicable Revenue Source
Effective at the time when the parties have connected a number of Suppliers
equal to one hundred fifty percent (150%) of the number of Existing Suppliers
("Supplier Level") IBM will share in the revenue from the Existing Suppliers
Subscription Revenue.
Notwithstanding the above, IBM's share of the Retailer Usage Revenue will in
no event be less than twenty-nine dollars ($29.00) per End Point and eight
dollars ($8.00) plus international surcharges per megabyte transmitted for
each Retailer per month if the Retailer has migrated to the IBM service.
Prior to the time when the Supplier Level has been achieved, QCS will pay IBM
twenty-nine dollars ($29.00) per End Point and eight dollars ($8.00) plus
international surcharges per megabyte transmitted for each Existing Supplier
per month if the Existing Supplier has migrated to the IBM Service.
QCS will pay IBM twenty-nine dollars ($29.00) per End Point and eight dollars
($8.00) plus
[*] CONFIDENTIAL PORTIONS OMITTED AND FILED SEPARATELY WITH COMMISSION
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international surcharges per megabyte transmitted for each QCS End Point used
by QCS employees, QCS' service providers and QCS' business partners.
Periodically the parties may elect to revise the End Point rate and the base
per megabyte rate subject to a separate written agreement and signed by both
parties.
Other than as specified in this Agreement, no other transfers of revenue,
shipping costs, taxes, tariffs, duties and the like will occur between the
parties, and each party will bear its own expenses necessary to perform its
obligations under this Agreement.
3) TERMINATION
If QCS terminates for convenience or, if IBM terminates for cause (as
provided in the Agreement). QCS will continue to make payments to IBM as
provided in this Supplement for five (5) years from the termination date,
based on the following schedule:
("Years" are defined as the periods commencing on the termination date and
each anniversary thereafter)
Year1 = 100%; Year 2 = 80%; Year 3 = 60%; Year 4 = 40%; and Year 5 = 20%
4) INTELLECTUAL PROPERTY
QCS hereby grants to IBM the irrevocable right and license to use the
trademarks, service marks or trade names ("Marks") of QCS for marketing and
related purposes in order to market and conduct the activities necessary or
advisable under and for the duration of this Agreement.
Unless expressly stated otherwise in this Agreement or in an identified
separate agreement:
a) IBM does not grant QCS any licenses to IBM trademarks, service
marks, copyrights, patents or other intellectual property in the
Service, Products or Materials under this Agreement;
b) IBM does not grant QCS' Retailers or Suppliers any license under
other IBM patents; and
For any materials (including code, documentation and related materials) which
QCS provides to IBM hereunder, you hereby grant to IBM a non-exclusive,
worldwide, irrevocable, license to use, reproduce, display, prepare
derivative works and distribute all of the foregoing QCS Software in order to
market and conduct the activities necessary or advisable under and for the
duration of this Agreement.
5) FREEDOM OF ACTION
a) Each party may have similar agreements with others. Each party may design,
develop, manufacture, acquire or market competitive products and services and
conduct its business in whatever way it chooses provided there is no conflict
with this Agreement. IBM does not guarantee the success of its marketing
efforts or the availability of any information through or performance of the
Service. Each party will independently establish prices for its products and
services.
b) This Agreement shall not be construed to limit either party's right to
obtain services or software programs from other sources, to prohibit or
restrict either party from independently developing or acquiring materials
competitive with those items developed or licensed hereunder, to restrict
either party from making, having made, using, leasing, licensing, selling or
otherwise disposing of any products or services whatsoever, nor to limit
either party's right to deal with other vendors, suppliers, contractors or
customers.
6) IBM AND QCS RESPONSIBILITIES
a) IBM RESPONSIBILITIES
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IBM will:
a) install the QCS Software on the Service no later than ninety (90)
days following the Effective Date;
b) in IBM's sole and absolute discretion, market and install the QCS
Software to Suppliers worldwide;
c) in IBM's sole and absolute discretion, assist QCS in marketing to
Retailers;
d) assume responsibility for the acquiring the contents of, and
packaging of the QCS Supplier Installation kit, which may
include items such as digital camera, image-edit software,
modem, and other hardware and software, no later than six (6)
months after the Effective Date. During this transition
period, IBM will refund QCS the expenses incurred for
providing this service.
e) provide telephone support maintenance for Lotus Notes and QCS
software to Suppliers;
f) regularly, but at least weekly, update the supplier customer
database;
b) QCS RESPONSIBILITIES
QCS will:
a) within two (2) business days following the Effective Date, deliver
to IBM a complete list of Existing Suppliers comprising the
pertinent information related to each Existing Supplier
including, but not limited to, their names and addresses;
b) for each Retailer that licenses the QCS Software prior to the
Effective Date or anytime thereafter, provide to IBM current
and timely pertinent information related to such Retailer's
Suppliers including, but not limited to, their names and
addresses;
c) deliver to IBM, in an agreed to format(s) (i.e. tape, diskettes,
CD-ROM or electronically) copies of the QCS Software
sufficient to enable IBM to perform its obligations hereunder;
d) at mutually agreed to times and locations, provide training and
education to IBM personnel and IBM business partners related
to the QCS Software to enable such personnel to train and
educate third parties ("teach the teachers program");
e) for a minimum of six (6) months following the Effective Date,
maintain its existing sales, marketing, and technical
personnel force to assist, support and educate IBM personnel
in the sales and marketing of the QCS Supplier Software;
f) provide to IBM a written or electronic monthly report containing
all End User and other Customer escalations and complaints
related to any products, offerings or services provided
hereunder which QCS becomes aware of;
g) continue acquiring the contents of, and packaging of the QCS
Supplier Installation kit for a period up to six (6) months
after the Effective Date;
h) provide to mutually agreed to IBM Personnel, unlimited,
twenty-four (24) hours, seven (7) days per week access to all
the Lotus Notes based monitoring tools of those Retailers and
Suppliers that are connected to the Service for network usage
and revenue tracking purposes; and
i) be responsible for all billing and collection activity associated
with any products, Offerings or services provided hereunder
and remit to IBM, in a timely manner any payments due to IBM
in accordance with the Agreement.
c) IBM AND QCS RESPONSIBILITIES
IBM and QCS agree to use best efforts to:
a) cooperate and migrate the QCS Software and related databases from
QCS servers located at QCS facilities in Mountain View, California
and London, England ("QCS Servers") to IBM servers located in
facilities chosen by IBM in its sole discretion ("IBM Servers");
b) within thirty (30) days following the Effective Date, form a
Review Committee consisting of individuals representing each
party, which will be responsible for setting the strategic
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direction of the overall project under this Agreement, making
policy, setting targets and reviewing performance, obtaining
the approval of the respective parties for press releases,
publicity, advertising and other significant marketing
activities; and
c) create a plan and cooperate in its execution to migrate Existing
Suppliers and Retailers to the Service.
Supplement 1 11/23
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