1
REDACTED VERSION
AGREEMENT
FOR
INFORMATION TECHNOLOGY SERVICES
BETWEEN
WALL DATA INCORPORATED
AND
ELECTRONIC DATA SYSTEMS CORPORATION
[*] - Confidential information omitted and filed separately with the
Securities and Exchange Commission pursuant to a request for
confidential treatment.
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AGREEMENT
FOR
INFORMATION TECHNOLOGY SERVICES
THIS AGREEMENT, dated effective as of May 13, 1997 (the "Effective
Date") is by and between Wall Data Incorporated, a Washington corporation ("Wall
Data"), and Electronic Data Systems Corporation, a Delaware corporation ("EDS").
AGREEMENT, TERM AND DEFINITIONS
1.1 Agreement. During the Term, EDS will supply to Wall Data, and Wall
Data will purchase from EDS, the information technology services
described in this Agreement, all upon and subject to the terms and
conditions specified in this Agreement.
1.2 Term of Agreement. The term of this Agreement (the "Term") will begin
on the Effective Date and will end on the tenth anniversary of the
Effective Date. The date on which the Term expires due to passage of
time is referred to in this Agreement as the "Expiration Date". This
Agreement may be terminated prior to the Expiration Date in
accordance with Article IX.
1.3 Defined Terms. As used in this Agreement, the following terms have
the meanings set forth below.
(a) Access. The term "Access" means the enjoyment of physical
and legal use and operation of Software, equipment,
hardware or any other item or facility which EDS needs in
order for EDS to provide the Services in the manner
provided herein.
(b) EDS Software. The term "EDS Software" means any Software
which is owned by EDS (and not proprietary to any other
party) and operated by EDS in connection with the
performance of the Services. Although no EDS Software is to
initially be used in the performance of the Base Services,
in the event any EDS Software is so used, Schedule 1.3(b)
will be completed and attached to and added to this
Agreement.
(c) EDS-Vendor Software. The term "EDS-Vendor Software" means
any Software which is licensed to EDS and operated by EDS
in connection with the performance of the Services.
Although no EDS-Vendor Software is to initially be used in
the performance of the Base Services, in the event any
EDS-Vendor Software is so used, Schedule 1.3(c) will be
completed and attached to and added to this Agreement.
(d) Wall Data Software. The term "Wall Data Software" means any
Software which is owned by Wall Data (and not proprietary
to any other party) and which is to be operated by or on
behalf of Wall Data. Wall Data Software is identified on
Schedule 1.3(d), which Schedule may be amended from time to
time by mutual written agreement of the parties.
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(e) Wall Data-Vendor Software. The term "Wall Data-Vendor
Software" means any Software which is proprietary to any
other party other than Wall Data or EDS and which is to be
operated by or on behalf of Wall Data. Wall Data-Vendor
Software is identified on Schedule 1.3(e), which Schedule
may be amended from time to time by mutual written
agreement of the parties.
(f) Services. The term "Services" means the Base Services and
the Additional Services, if any, that may be provided by
EDS under this Agreement.
(g) Software. The term "Software" means computer programs
together with input and output formats, program listings,
narrative descriptions, operating instructions, and
supporting documentation and shall include the tangible
media upon which such programs and documentation are
recorded. Except as otherwise provided in this Agreement,
Software includes any enhancements, translations,
modifications, updates, new releases, and other changes.
Other capitalized terms used in this Agreement are defined
herein from time to time.
ARTICLE II. INFORMATION TECHNOLOGY SERVICES
TO BE PERFORMED BY EDS
2.1 EDS Personnel and Management.
(a) EDS Account Director. During the Term, EDS will provide an
EDS Account Director (the "EDS Account Director") who has
the responsibility for the provision of information
technology services to be provided by EDS under this
Agreement. The EDS Account Director will maintain
appropriate work space in the Wall Data facility located at
11332 N.E. 122nd Way, Kirkland, Washington 98034-6931, will
have overall responsibility for managing and coordinating
the delivery of the Services and for the performance of the
EDS personnel comprising the EDS/Wall Data account team and
will coordinate and consult with the Wall Data
Representative (as defined in Section 3.1(a)). The
EDS Account Director will meet regularly with the Wall Data
Representative as well as other Wall Data designated
personnel in order to review the information technology
priorities established by Wall Data and the status of EDS'
performance under this Agreement. If either Wall Data or
EDS desires to replace the EDS Account Director, Wall Data
shall have the right (i) to participate in the interview
process for the replacement and (ii) to accept or reject
the replacement; provided, however, that Wall Data's
acceptance must not be unreasonably withheld and any
rejection must be for reasonable cause.
(b) Steering Committee. On or before the Effective Date, Wall
Data and EDS will each give the other written notice of the
names of the three members of their respective management
staff (inclusive of the EDS Account Director and the Wall
Data Representative) who will serve on an executive
steering committee (the "Executive Steering Committee").
Wall Data will designate one of its members on the
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Executive Steering Committee to act as the chairman of the
Executive Steering Committee. The Executive Steering
Committee will be responsible for making strategic
decisions for Wall Data with respect to linking Wall Data's
business objectives to Wall Data's existing and future
plans for information technology. Wall Data and EDS each
may from time-to-time replace the members of its management
staff serving on the Executive Steering Committee with
other members of its management staff, except that the EDS
Account Director and the Wall Data Representative will be
members of the Executive Steering Committee throughout the
Term of this Agreement. Although the EDS Account Director
will remain a member of the Executive Steering Committee,
EDS will remove and replace either of the other two EDS
members, which Wall Data, in good faith, requests to have
removed for reasonable cause. Wall Data shall have the
right (i) to participate in the selection process for the
replacement(s) and (ii) to accept the replacement(s),
provided, that Wall Data's acceptance is not unreasonably
withheld. Wall Data and EDS may mutually agree to increase
or decrease the size of the Executive Steering Committee or
to change the qualifications of who may serve on the
Executive Steering Committee. The Executive Steering
Committee will meet at least quarterly unless otherwise
agreed by Wall Data and EDS.
(c) Transition of Personnel; Notification of Change in
Employment Status. On or prior to the Effective Date, EDS
will offer employment, effective the start of business on
the Effective Date, to the data processing employees of
Wall Data identified in Schedule 2.1(c) (the "Transitioned
Employees") in accordance with EDS' normal employment
policies. In preparation for the transition of employment,
EDS and Wall Data will take the necessary measures so that
the representatives of the affected personnel departments
of the parties will meet and work together to accomplish a
smooth and orderly transition for such employees. Neither
party will make any representation, promise, or other
communication, whether written or oral, to the Transitioned
Employees regarding employment with EDS, or the employment
benefits, plans, or practices of EDS without obtaining the
prior written consent of the other. EDS will notify Wall
Data any changes in the employment status of the
Transitioned Employees while employed by EDS, including the
placement of a Transitioned Employee to an EDS account
other than Wall Data.
(d) Financial Responsibility for EDS Personnel. Except for
out-of-pocket expenses, which shall be paid in accordance
with Section 7.1(c), EDS will pay for all personnel
expenses, including wages and benefits of its employees
performing the Services.
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2.2 EDS Information Technology Services.
(a) Description of Services. During the Term, and in accordance
with the provisions of this Agreement, EDS will provide to
Wall Data (a) the services described in the statement of
work attached as Schedule 2.2 to this Agreement (the
"Statement of Work") and (b) the Networking and
Telecommunication Services (defined below). The services
described in the Statement of Work and the Networking and
Telecommunication Services will be collectively referred to
herein as the "Base Services." The Base Services will be
performed at the Wall Data facility located at 11332 N.E.
122nd Way, Kirkland, Washington 98034-6931, and the Wall
Data facilities specifically listed in Schedule 2.2, as
such facilities exist as of the Effective Date
(collectively, the "Wall Data Locations"). At Wall Data's
request, EDS will provide the Base Services at sites other
than the Wall Data Locations as an Additional Service in
accordance with Section 2.4. The Networking and
Telecommunication Services are more particularly described
in Section 2.3 below.
(b) Service Levels. Wall Data agrees that, during a one hundred
eighty (180) day period commencing on the Effective Date
and ending on the one hundred eightieth (180th) day
thereafter (the "Due Diligence Period"), it will work with
EDS to define and determine (i) as of the Effective Date,
the existence, use and capacity of the Wall Data Software,
the Wall Data-Vendor Software, the Wall Data-Owned
Equipment and the Wall Data Leased Equipment that will be
used and operated by EDS in the performance of the Base
Services, (ii) the manner of measurement, and (iii) the
actual respective levels of service pursuant to which the
Base Services will be provided by EDS pursuant to this
Agreement, which service levels will based on industry
standards and the existence, use and capacity of the Wall
Data Software, the Wall Data-Vendor Software, the Wall
Data-Owned Equipment, the Wall Data Leased Equipment and
the Wall Data network as of the Effective Date. After the
determination of such service levels, Wall Data will
confirm the accuracy of each and, upon such confirmation,
approve each such level in writing and deliver such written
approval to EDS (the "Service Level Agreement"). The
measurements contained in the Service Level Agreement (as
may be amended from time to time in accordance with this
Section) will be used in each and every instance in which
the terms of this Agreement call for, use or refer to, the
levels of service for the Base Services to be performed and
provided by EDS pursuant to this Agreement.
At least annually, the Executive Steering Committee will
review the Service Level Agreement and focus on, if
applicable, Wall Data's reasonable business requirements,
including its desire for any increase in service levels and
related capacity requirements, for the subsequent year, and
any EDS recommendations stemming from the technology
refresh programs described in the Statement of Work. If
such review indicates (i) that the service levels contained
in the Service Level Agreement need to be adjusted to meet
such business requirements, and EDS determines in its
reasonable business judgment that, in order to meet such
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adjusted service levels, additional hardware, Software,
data/telecommunications services or other items are needed
(either as additions to, or replacements of, certain items
within Wall Data's then existing information technology
environment), or (ii) that technology refreshes in the form
of upgrades or otherwise in hardware, Software or other
items would be appropriate or desirable, then Wall Data
will determine whether it desires to acquire such
additional items at its expense as provided below. To the
extent that such additional items are so acquired, the
parties will mutually determine and agree on appropriate
adjustments to the applicable service levels, and such
adjustments will be documented in an amendment to the then
current Service Level Agreement.
In addition, if and to the extent that EDS can demonstrate
to the reasonable satisfaction of Wall Data that the then
current service levels will, within a period of time
reasonably estimated by EDS, no longer be achievable due to
the fact that certain hardware, Software or other items
material to the operation of Wall Data's then existing
information technology environment are (i) obsolete, (ii)
worn out, (iii) incompatible with any upgraded technology
in use at Wall Data, (iv) no longer commercially supported
by the applicable vendor, or (v) not reasonably sufficient
to support Wall Data's increased business requirements,
then Wall Data will determine whether it desires to replace
such items at its expense as provided below. If Wall Data
decides not to replace such items, EDS will not be in
default of the applicable service level obligations under
this Agreement to the extent that such decision adversely
affects EDS' ability to properly perform such obligations.
Wall Data will be financially responsible for (i) all
hardware, Software, equipment, supplies and
data/telecommunications services determined to be necessary
or desirable in accordance with this Section, and (ii) any
service requirements resulting therefrom beyond the scope
of services set forth in the Statement of Work, which will
be provided by EDS as an Additional Service.
The parties agree and acknowledge that, during the period
of time in which the measurement activities are to be
undertaken pursuant to this Section 2.2(b), EDS will be
providing the Base Services pursuant to the terms of this
Agreement in a manner so that the delivery of such Base
Services reasonably approaches service levels generally
recognized within the industry and Wall Data will be
obligated to pay EDS for such Base Services during that
period.
(c) Global Services. The parties acknowledge and agree that
this Agreement is intended to be a global agreement and
that, for any Services to be performed by EDS for Wall Data
outside of the United States, such Services will be
performed pursuant to local country agreements or Task
Orders, as defined in Section 2.4 below, which will be job
specific and country specific for those Services in the
country or region in which they are to be performed. In
performing Services in countries other than the United
States, Wall Data acknowledges and agrees that EDS may
perform such Services by or through subsidiaries or
affiliates of EDS which are situated in that country or
region;
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provided, however, that EDS and Wall Data will be and
remain liable and responsible for their respective
obligations under this Agreement and any local country
agreements or Task Orders, including the Services being
performed and for the payment therefor. Any local country
agreement or Task Order, the subject of which is the
performance of Services outside of the United States, must
be approved in writing by the joint executions of the EDS
Account Director and the Wall Data Representative.
(d) Export Compliance. This Agreement is expressly made subject
to any United States of America government laws,
regulations, orders or other restrictions regarding export
from the United States of computer hardware, software,
technical data or derivatives of such software, hardware or
technical data. Notwithstanding anything else in this
Agreement to the contrary, neither Wall Data nor EDS shall
directly or indirectly export (or re-export) any computer
hardware, software, or technical data related to the
Services provided pursuant to this Agreement or derivatives
of such software, hardware or technical data, or permit
shipment of same (i) into (or to a national or resident of)
Cuba, North Korea, Iran, Iraq, Libya, Syria, or any other
country to which the United States has embargoed goods, or
(ii) to anyone on the U.S. Treasury Department's List of
Specially Designated Nationals, List of Specially
Designated Terrorists and List of Specially Designated
Narcotics Traffickers, or the U.S. Commerce Department's
Denied Parties List, or (iii) to any country or destination
for which the United States government or a United States
governmental agency requires as export license or other
approval for export without first having obtained such
license or other approval. This obligation shall survive
the expiration or early termination of this Agreement.
(e) Year 2000 Issues. Wall Data acknowledges and agrees that
the Base Services do not include any changes,
modifications, updates or enhancements to Wall Data
Software or any third-party Software which may be necessary
so that all of such Software will (i) operate and produce
data on and after January 1, 2000 (including taking into
effect that such year is a leap year), accurately and
without delay, interruption or error relating to the fact
that the time at which and the date on which such product
is operating is on or after 12:00 a.m. on January 1, 2000
(including taking into effect that such year is a leap
year) or (ii) accept, calculate, process, maintain, store
and output, accurately and without delay, interruption or
error, all times or dates, or both, whether before, on or
after 12:00 a.m. January 1, 2000 (including taking into
effect that such year is a leap year), and any time periods
determined or to be determined based on any such times or
dates, or both. However, EDS would be willing to provide as
an Additional Service for an additional charge all such
changes, modifications, updates or enhancements to such
Software.
2.3 Networking and Telecommunications Services. During the Term, EDS will
provide to Wall Data the following services in accordance with the
responsibilities and assumptions set forth in this Agreement:
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(a) Networking and Telecommunications Services. EDS will
acquire, implement and administratively support, on Wall
Data's behalf and at Wall Data's expense and with Wall
Data's prior written consent to any and all specific
services, outbound long distance calling services, 800
inbound services and calling card services and any other
telecommunications services in place for Wall Data as of
the Effective Date to the extent such services are more
particularly described in Sections IV and V of the
Statement of Work (the "Networking and Telecommunication
Services"). EDS may acquire such services from a
telecommunications vendor or vendors as EDS deems
appropriate (collectively, the "Vendor") and pass those
services on to Wall Data as Services under this Agreement.
EDS will provide Wall Data with prior notice of its intent
to change Wall Data's existing or future Vendor and will
not effect a change in Wall Data's existing or future
Vendor that would cause Wall Data to incur increased
telecommunication rates or charges for the Networking and
Telecommunication Services (excluding increased rates and
charges based on Wall Data's usage or business
requirements) without Wall Data's prior written consent.
EDS will provide such Networking and Telecommunication
Services to the Wall Data sites identified in Sections IV
and V of the Statement of Work. Section IV (Network
Management) and Section V (Telecommunications) of the
Statement of Work define the scope of the Networking and
Telecommunications Services to be provided by EDS as Base
Services under this Agreement. In the event there are
substantial technological advances in telecommunications or
other related media and, as a result of such advances,
complexities are introduced that impact or modify the
service levels or functions from those in effect as of the
Effective Date with regard to the telecommunications
responsibilities of EDS, the parties will negotiate in good
faith as to any modifications that should be made in this
Agreement as a result thereof.
(b) Billing Administration. EDS will provide to Wall Data on a
monthly basis, a consolidated bill of rated call detail
containing the following information: date and time of
call, duration, destination (both number and location), and
total per Wall Data Location.
(c) Implementation Plan. EDS will develop and coordinate with
Wall Data and Vendor(s) an implementation plan so as to
commence the Networking and Telecommunication Services by
July 1, 1997.
(d) Quality, Performance and Remedies. EDS makes no
representation or warranty respecting the quality of the
Networking and Telecommunication Services made available to
it by the Vendor or LEC (as defined in Section 7.1(b)(i) of
this Agreement) and provided or made available to Wall Data
pursuant to this Agreement. Wall Data's remedies for any
service problems with respect to the Networking and
Telecommunication Services will be the remedies set forth
in the tariff, regulations or agreement applicable to such
Vendor or LEC. EDS' responsibility will be to coordinate
with Wall Data and communicate with the Vendor or LEC and
assist Wall
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Data in the proper reporting of the service problem on Wall
Data's behalf and passing through to Wall Data any credits
received from such Vendor for such service problem.
2.4 Additional Services. Upon the reasonable written request of Wall
Data, EDS will, subject to the other terms and conditions of this
Section 2.4, provide Wall Data with such additional services which
are beyond the scope, level or capacity of the Base Services
described in this Agreement as Wall Data and EDS agree in accordance
with this Section (collectively, the "Additional Services"). The
specific request for Additional Services to be supplied by EDS to
Wall Data, the compensation to be paid and other related matters
shall be expressed in written task orders ("Task Orders") prepared
from time to time by EDS in response to a request by Wall Data for
Additional Services. Each Task Order will incorporate by reference,
and shall be subject to, the terms and conditions of this Agreement.
EDS acknowledges and agrees that no billable Additional Services
shall begin unless and until a Task Order is executed and delivered
by the EDS Account Director and the Wall Data Representative. Each
Task Order shall be in such form as the parties mutually agree and
shall contain the following information, as applicable:
(a) The incorporation, by reference, of this Agreement.
(b) The designation of a unique identifying number.
(c) A description of the services or deliverables to be
provided by each party, including any documentation or
training to be provided by each party.
(d) A description of any standards or constraints to be applied
to the services performed by EDS.
(e) A description of the consideration and terms of payment for
services or deliverables.
(f) A description of any items of expense authorized for
reimbursement to EDS and the basis for such reimbursement.
(g) A description of requirements for the delivery and
frequency of status reports.
(h) The name and telephone number of the Wall Data
Representative and the EDS Account Director.
(i) A description of the respective Wall Data responsibilities
and EDS responsibilities.
(j) The term of the Task Order.
ARTICLE III. WALL DATA OBLIGATIONS
3.1 Wall Data Personnel and Management.
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(a) Wall Data Representative. During the Term, Wall Data will
maintain a designated representative (the "Wall Data
Representative") who will be a senior executive of Wall
Data and who will be authorized to act as the primary point
of contact for EDS in dealing with Wall Data with respect
to each party's obligations under this Agreement.
(b) Transitioned Employees. Wall Data will cooperate with EDS
in the performance by EDS of its obligations to offer
employment to and hire the Transitioned Employees. Wall
Data has not and will not make any representation, promise,
or other communication, whether written or oral, to the
Transitioned Employees regarding employment with EDS, or
the employment benefits, plans, or practices of EDS without
obtaining the prior written consent of EDS. Wall Data will
direct any such questions to the EDS Account Director.
Should EDS request that Wall Data continue to make payments
to such employees after they are hired by EDS, Wall Data
will do so as an administrative convenience until such
personnel can be integrated into the EDS payroll system. In
such event, Wall Data will be acting solely as an
accommodation to EDS and EDS will reimburse Wall Data for
all wages paid and employer's contributions made by Wall
Data in connection therewith.
(c) Bonus. EDS will pay each Transitioned Employee employed by
EDS on July 4, 1997 a bonus of $2,000 within thirty (30)
days after such date. Prior to EDS' obligation to pay such
bonuses, Wall Data will pay EDS a lump sum aggregate amount
equal to $2,000 per Transitioned Employee employed by EDS
on July 4, 1997.
3.2 Wall Data Operational Obligations. During the Term, Wall Data will,
on a timely basis and at no charge to EDS, perform the support
services and discharge the obligations described in Schedule 3.2.
3.3 Wall Data Financial Obligations. In addition to the payment of
certain out-of-pocket expenses provided in Section 7.1(c), Wall Data
shall pay all costs for the acquisition of, or costs associated with,
any and all Software (including, without limitation, the Wall Data
Software and the Wall Data-Vendor Software), and hardware (including,
without limitation, the Wall Data-Owned Equipment and the Wall Data
Leased Equipment) related to or which may be necessary (as determined
by the Executive Steering Committee and approved by Wall Data in
accordance with Section 2.2(b)) for the performance of the Services
by EDS pursuant to this Agreement, it being hereby acknowledged by
the parties that such items are not being assigned to, or being
assumed by, EDS, but shall remain or be the financial
responsibilities of Wall Data. In addition to any other financial
responsibilities of Wall Data expressly provided herein, Wall Data
will pay all costs and expenses related to each item which is to be
provided by Wall Data pursuant hereto and for which the financial
responsibility has not been expressly assumed by EDS under this
Agreement, including, without limitation, the items set forth in
Sections 3.1 and 3.2.
ARTICLE IV. EQUIPMENT AND RELATED AGREEMENTS
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4.1 Wall Data-Owned Equipment. During the Term, Wall Data will furnish to
EDS for EDS' use in providing the Services at no charge, the
equipment owned by Wall Data that is either listed on the attached
Schedule 4.1 or which is purchased by Wall Data subsequent to the
Effective Date for information technology purposes (and which is
added to Schedule 4.1 by mutual consent of the parties)
(collectively, the "Wall Data-Owned Equipment"). The Wall Data-Owned
Equipment will remain the property of Wall Data and, as such, Wall
Data will have and retain all ownership and control of the Wall Data
Owned Equipment. Wall Data will pay all costs and expenses with
respect to the Wall Data-Owned Equipment, including, without
limitation, depreciation, insurance and taxes.
4.2 Wall Data Leased Equipment. During the Term, Wall Data will furnish
to EDS for EDS' use in providing the Services, at no charge to EDS,
complete use and Access to the equipment leased by Wall Data that is
listed on the attached Schedule 4.2 or which is leased by Wall Data
subsequent to the Effective Date for information technology purposes
(and which is added to Schedule 4.2 by mutual consent of the parties)
(collectively, the "Wall Data Leased Equipment"). Wall Data will pay
all costs and expenses with respect to the Wall Data Leased
Equipment, including, without limitation, all lease payments,
insurance and taxes, and Wall Data will also pay all costs necessary
to obtain Access for EDS to the Wall Data Leased Equipment.
4.3 Third Party Approvals. Wall Data and EDS will work together to take
all actions necessary to obtain any consents, approvals, or
authorizations from third parties necessary for EDS to lawfully
access, operate, and use (at or from any location where the Services
are to be provided) the Wall Data-Owned Equipment and the Wall Data
Leased Equipment. The payment of any costs and expenses incurred will
be borne solely by Wall Data.
4.4 Service Agreements. Subject to the terms and conditions set forth in
this Section 4.4 and subject to Wall Data obtaining any required
consents, Wall Data will assign to EDS all of Wall Data's right,
title and interest in and to the agreements listed in Schedule 4.4
(collectively, the "Maintenance Agreements") relating to the
maintenance of the Wall Data Software, the Wall Data Vendor Software,
the Wall Data Owned Equipment and the Wall Data Leased Equipment, and
EDS agrees to assume all of Wall Data's obligations arising under the
Maintenance Agreements subsequent to the Effective Date. If a
required consent is not obtained, then (a) EDS will determine and
adopt, subject to Wall Data's prior approval, such alternative
approaches as are necessary and sufficient to perform the Services
without such required consent, and (b) the parties will mutually
agree on any appropriate adjustments to this Agreement, including the
scope of Services, Service Levels, and the Monthly Base Charges.
Wall Data represents and warrants to EDS that, as of the Effective
Date, (a) it is not (and, to its knowledge, the provider of the
maintenance services is not) in default in any material respect under
any of the Maintenance Agreements, and (b) it has delivered to EDS
full and complete copies of the Maintenance Agreements (including any
amendments thereto) prior to the Effective Date. Wall Data agrees
that the representations and warranties contained in this Section 4.4
will be true and correct as of the Effective Date. Wall Data agrees
that it will not amend any of the Maintenance Agreements prior to the
Effective Date without the prior
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written consent of EDS. Wall Data and EDS agree to execute and
deliver an assignment and assumption agreement in a form that is
mutually agreed to by the parties evidencing the assignment and
assumption of the Maintenance Agreements contemplated by this
Section 4.4.
4.5 Further Assurances. Wall Data and EDS agree to execute and deliver
such other instruments and documents as either party reasonably
requests to evidence or effect the transactions contemplated by this
Article.
4.6 Agency Appointment. Wall Data hereby appoints EDS as its sole agent
for all matters pertaining to the operation of the Wall Data-Owned
Equipment and the Wall Data Leased Equipment and will promptly notify
all appropriate third parties of such appointment. Notwithstanding
the foregoing, EDS will have no authority to (a) cause Wall Data to
incur any material cost or expense with regard to the Wall Data-Owned
Equipment or the Wall Data Leased Equipment, or (b) amend, modify or
waive any rights or interests contained in any Wall Data agreement
relating to the Wall Data-Owned Equipment or the Wall Data Leased
Equipment, without Wall Data's prior approval.
ARTICLE V. SOFTWARE
5.1 Wall Data Software. Wall Data Software will remain Wall Data's
property and EDS will have no ownership interests or other rights in
the Wall Data Software, except as provided in this Section. Wall Data
grants to EDS the right to Access Wall Data Software, without charge
to EDS, to provide the Services. The Wall Data Software will be made
available to EDS on such media as may be reasonably requested by EDS,
together with existing documentation and other materials.
5.2 Wall Data-Vendor Software. On or before the date EDS will begin to
access such Software, Wall Data and EDS will work together to obtain
all consents necessary to permit EDS to Access or operate the Wall
Data-Vendor Software and Wall Data will pay all costs and expenses
associated therewith. Wall Data will provide written evidence of such
consents to EDS upon EDS' request. The Wall Data-Vendor Software will
be made available to EDS, together with documentation and other
materials related to the Wall Data-Vendor Software that were
originally delivered to Wall Data by the applicable vendor. During
the term of this Agreement, Wall Data will pay all required (as
determined by the Executive Steering Committee and approved by Wall
Data in accordance with Section 2.2(b)) license, installation and
upgrade fees with respect to the Wall Data-Vendor Software. Nothing
contained in this Agreement will require either party to violate the
proprietary rights of any third party in any Software.
5.3 EDS Software. EDS Software will remain EDS' property and Wall Data
will have no rights or interests therein except that, upon the
expiration or early termination of this Agreement (except for
termination due to non-payment by Wall Data) and subject to the other
terms and conditions of this Agreement, EDS shall grant to Wall Data
a perpetual, nontransferable, nonexclusive, royalty-free license to
use, after the Expiration Date, any application software programs
(including existing documentation) of any EDS Software then being
used by EDS in
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rendering services to Wall Data (the "Licensed Programs"), subject
to Wall Data and EDS entering into an agreement, in form and
substance reasonably satisfactory to EDS and Wall Data, containing
such terms and conditions as may be appropriate.
5.4 EDS-Vendor Software. EDS will obtain all consents necessary to permit
EDS to Access or operate the EDS-Vendor Software and will pay all
costs and expenses associated therewith. During the term of this
Agreement, EDS will pay all required license, installation,
maintenance and upgrade fees with respect to the EDS-Vendor Software.
5.5 EDS Development Tools. EDS retains all right, title and interest in
and to any and all Software (excluding the Wall Data Software),
software development tools, know how, methodologies, processes,
technologies or algorithms used in providing any Services which are
based upon trade secrets or proprietary information of EDS or
otherwise owned or licensed by EDS (collectively, the "EDS
Development Tools"), and Wall Data shall have no right, title or
interest in and to the EDS Development Tools except as provided in
the following sentence. Upon the expiration or termination of this
Agreement, and subject to the other terms and conditions of this
Agreement, EDS shall grant to Wall Data a perpetual, nontransferable,
nonexclusive, royalty-free license to use, after the Expiration Date,
any EDS Development Tools then being used by EDS in rendering the
Services to Wall Data to be used solely for the internal business use
of Wall Data, subject to Wall Data and EDS entering into an
agreement, in form and substance reasonably satisfactory to EDS and
Wall Data, containing such terms and conditions as may be
appropriate.
ARTICLE VI. CONFIDENTIALITY, SECURITY AND AUDIT RIGHTS
6.1 Wall Data's Data. Information relating to Wall Data or its customers,
OEMs, licensors or other third parties contained in Wall Data's data
files ("Wall Data's Data") is the exclusive property of Wall Data.
EDS is authorized to have access to and make use of Wall Data's Data
as appropriate for the performance by EDS of its obligations under
this Agreement. Upon the termination or expiration of this Agreement,
EDS will return to Wall Data all of Wall Data's Data in EDS' then
existing machine-readable format and media or in any other then
existing format and media. EDS will not use Wall Data's Data for any
purpose other than providing the Services.
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6.2 Confidentiality. Except as otherwise provided in this Agreement, EDS
and Wall Data each agree that all information communicated to it
(through its employees, agents, consultants or subcontractors) by the
other or the other's affiliates, or otherwise obtained through the
performance of the Services or by reason of physical presence at the
respective party's facilities (with respect to information the
recipient should reasonably have known was confidential) whether
before or after the Effective Date, including, without limitation,
Wall Data Software, Wall Data's Data, EDS Software, trade secrets,
proprietary process, and the terms of this Agreement, will be
received in strict confidence, will be used only for purposes of this
Agreement, and will not be disclosed by the recipient party, its
agents, subcontractors or employees without the prior written consent
of the other party. Each party agrees to use the same means it uses
to protect its own confidential information, but in any event not
less than reasonable means, to prevent the disclosure of such
information to outside parties. However, neither party shall be
prevented from disclosing information which belongs to such party or
is (a) already known by the recipient party without an obligation of
confidentiality other than pursuant to this Agreement; (b) publicly
known or becomes publicly known through no unauthorized act of the
recipient party; (c) rightfully received from a third party; (d)
independently developed without use of the other party's confidential
information; (e) disclosed without similar restrictions to a third
party by the party owning the confidential information; (f) approved
by the other party for disclosure in writing; or (g) required to be
disclosed pursuant to a requirement of a governmental agency or law
if the disclosing party provides the other party with notice of this
requirement prior to disclosure. The provisions of this Section will
survive the expiration or termination of this Agreement for any
reason.
6.3 Security. EDS will comply with the security procedures that are in
effect at the Wall Data Locations as of the Effective Date as made
known to EDS. EDS will also institute such additional security
procedures at the Wall Data Locations that Wall Data reasonably
requests as an Additional Service. Wall Data will provide all
necessary security personnel and related equipment at the Wall Data
Locations. Except as to (a) Wall Data's need to access certain
information including Wall Data's Data for the purposes of Sections
6.2 and 6.4, and (b) a mutually agreed list of Wall Data employees,
agents, contractors or invitees, without the prior written consent of
EDS (such consent not to be unreasonably withheld), no employee,
agent, contractor or invitee of Wall Data will operate or assist in
operating equipment or Software to be used by EDS under this
Agreement in any data center located at the Wall Data Locations or
any shared EDS data center.
6.4 Audit Rights. EDS will provide auditors and inspectors that Wall Data
designates in writing with reasonable access for the limited purpose
of performing audits or inspections of Wall Data's business. EDS will
provide reasonable assistance of a routine nature to such auditors
and inspectors, and EDS will provide additional assistance as an
Additional Service. EDS will not be required to provide such auditors
and inspectors access to data of EDS customers, other than Wall Data,
or proprietary data of EDS.
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ARTICLE VII. PAYMENTS TO EDS
7.1 Charges for Services
(a) Monthly Base Charges.
(i) In consideration for the performance by EDS of
the Base Services, for each month following the
Effective Date, Wall Data will pay EDS the
Monthly Base Charges set forth in Schedule 7.1
(the "Monthly Base Charges"), as may be adjusted
in accordance with this Article. EDS will invoice
each such Monthly Base Charges on the first
business day of the month to which it relates and
such Monthly Base Charges will be due and payable
thirty (30) days after the date of the invoice.
The Monthly Base Charges for any partial month
will be prorated on a per diem basis. In addition
to the payment of the Monthly Base Charges, Wall
Data will also make payments for any Additional
Services which EDS may be providing to Wall Data
pursuant to the terms and conditions of this
Agreement.
(ii) The parties agree and acknowledge that, for any
of the Services provided by EDS outside of the
United States, EDS may invoice and collect such
payments in the local currency of the country or
region in which such Services were provided.
(iii) In addition to the above, the parties agree that,
during each November during the Term (the "Annual
Review Meeting"), the parties will meet and
jointly review the amount of the Monthly Base
Charges (including the Networking and
Telecommunication Services charges) for the
upcoming year of the Term in comparison to the
business plan (as it relates to information
technology), the information technology budget of
Wall Data, and Wall Data's planned revenue growth
rate (as determined by Wall Data's board of
directors) for the upcoming year. If such a
review reflects that there is a significant
disparity between the amount of the Monthly Base
Charges for such upcoming year of the Term and
the business plan, budgets and planned revenue
growth rate of Wall Data, the parties will
negotiate in good faith as to the amounts of the
Monthly Base Charges for the upcoming year (which
may include a proposed change in the usage rates
to be charged for the Networking and
Telecommunication Services); provided, however,
that, if the parties can not agree on such
amounts within thirty (30) days after such
meeting, the amounts for the Monthly Base Charges
will be adjusted in accordance with the
calculation set forth in Schedule 7.1.
The parties further agree that, during each May
during the Term (or at such later date as either
party may request), the parties will meet again
and jointly review the impact of a Material
Growth Change (as defined below), if any, to
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the Wall Data planned revenue growth rate
presented to EDS at the applicable Annual Review
Meeting and negotiate in good faith the
appropriate adjustments to the Monthly Base
Charges based on the Material Growth Change;
provided, however, that, if the parties can not
agree on such adjustments within thirty (30)
days after such meeting, the parties will adjust
the Monthly Base Charges in accordance with the
calculation set forth in Schedule 7.1. For
purposes of this Section 7.1(a)(iii), a
"Material Growth Change" shall mean a revision
in Wall Data's planned revenue growth rate as
adopted in good faith by Wall Data's board of
directors.
(b) Networking and Telecommunications Services Charges.
(i) Wall Data will pay, in the manner reflected in
this Section 7.1(b), to EDS all charges billed
pursuant to the billing administration section of
the Networking and Telecommunication Services in
Section 2.3(b), which shall consist of recurring,
non-recurring and usage charges (including
applicable billings to the Vendor (as defined in
Section 2.3(a)) from the applicable Local
Exchange Carriers ("LEC's") but excluding
applicable billings to Wall Data from the
applicable LECs) and applicable taxes with
respect to the services provided or made
available to Wall Data under this Agreement. Such
charges shall be based upon and subject to EDS'
agreement with the Vendor providing such
services, including all tariffs, rates, volume
commitments, discounts, restrictions, covenants,
regulations and other conditions contained
therein and applicable thereto from time to time.
In addition to any such agreement between EDS and
the Vendor and potential changes thereto, as
permitted by the Federal Communications
Commission and the state utility commissions, the
LECs may, from time to time, effect tariff
revisions which will change the recurring
(access) and intrastate usage charges to EDS.
When this occurs, EDS will adjust its charges to
Wall Data to reflect such changes and will notify
Wall Data as promptly as possible of any such
change. In addition, the parties acknowledge that
charges to Wall Data for any given month will be
based upon Wall Data calling patterns for such
month, including originating locations, locations
called, frequency of calls, length and time of
calls and other such factors, and that such
charges may therefore fluctuate accordingly from
month to month. The usage rates that will be
charged by EDS to Wall Data for the Networking
and Telecommunication Services are reflected in
Schedule 7.1(b), attached hereto and made part
hereof.
As to the manner of payment for the Networking
and Telecommunication Services provided by EDS,
the parties will establish for Wall Data a dollar
amount which shall be a baseline (the "Baseline")
on Networking and Telecommunication Services
usage which shall be based on the average
recurring, non-recurring and usage charges
incurred by Wall Data in the three (3) months
immediately preceding the Effective Date. The
Monthly Base Charges paid to EDS will include the
Networking and Telecommunications
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Services Baseline amount. Each calendar quarter
during the Term, EDS and Wall Data will have a
reconciliation of the Networking and
Telecommunication Services payments as to the
amounts paid to EDS (based on the Baseline
amounts) as compared to the actual usage amounts
(both as to actual usage greater than and less
than the Baseline). Due to the information that
will be available at the time of the
reconciliation, such reconciliation will be for
the last month of the immediately prior calendar
quarter and the first two (2) months of the
calendar quarter which would have just concluded
prior to the reconciliation. The parties agree
and acknowledge that Wall Data shall ultimately
be responsible and liable to pay only for its
actual usage of the Networking and
Telecommunication Services. On an annual basis,
the parties will negotiate in good faith to
adjust the amount of the Baseline as it compares
to the charges then in effect.
(ii) Certain LEC Charges. The LECs providing
Networking and Telecommunication Services to Wall
Data under this Agreement may require
non-recurring installation charges for
implementation of such Services. Such charges, if
billed to EDS, will be passed directly through to
Wall Data at the amount charged to EDS by the
LECs. Should Wall Data choose to provide access
to the Networking and Telecommunication Services
through its LEC rather than through the Vendor,
Wall Data shall be responsible for coordinating
with such LEC and assuring such LEC's
coordination with the Vendor for implementation
and support of such access, and for any recurring
or non-recurring charges associated with such
access, whether such charges are billed to Wall
Data or EDS.
(iii) Pre-Service Conversion Date Charges. For
any conversions that may need to occur for EDS to
provide the Networking and Telecommunication
Services, if any, for each Wall Data Location,
Wall Data will retain all financial
responsibility for voice telecommunications
services for the period prior to the date that
the Vendor or LEC converts the Networking and
Telecommunication Services (the "Service
Conversion Date"), whether the charges for such
services are received by Wall Data or EDS either
prior to or following the Service Conversion
Date.
(iv) Taxes. There will be added to any charges
hereunder, if applicable, and Wall Data shall pay
to EDS, amounts equal to any taxes, however
designated or levied, based upon such charges, or
upon this Agreement and Networking and
Telecommunication Services or Telecommunications
Equipment provided hereunder, or their use,
including state and local sales, use, privilege
or excise taxes based on gross revenue, and any
taxes or amounts in lieu thereof paid or payable
by EDS in respect of the foregoing, exclusive,
however, of franchise taxes, taxes based on net
income of EDS and taxes incurred by EDS pursuant
to the Washington business and occupations tax
law.
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Should Additional Services be required by Wall
Data which change the scope of the Networking and
Telecommunication Services offered pursuant to
this Agreement, Section 2.4 of the Agreement will
apply. Unless otherwise stated in this Section
7.1(b), all payments shall be made in accordance
with Article VII of this Agreement.
(c) Out-of-Pocket Expenses. In addition to the payment of the
Monthly Base Charges or the fees for any Additional
Services, Wall Data will pay for all reasonable
out-of-pocket expenses that Wall Data has given prior
written authorization. Such out-of-pocket expenses include,
without limitation, travel and travel-related expenses that
are directly related to the provision by EDS of the
Services.
(d) Adjustment for Significant Business Changes. If, during the
Term, Wall Data, (i) is merged into another entity or
another entity is merged into Wall Data, (ii) is sold to or
purchased by another entity or Wall Data buys or purchases
another entity, (iii) experiences a change from its
operations which results in a substantial change in its
financial standing or net worth as of the Effective Date,
or (iv) experiences any other type of business modification
which results in a substantial change in Wall Data's need
for the quantity or quality of the Services to be provided
by EDS pursuant to the terms of this Agreement, then, in
any of such events, upon written request of either party to
this Agreement, the parties will negotiate in good faith to
reach a mutually agreeable adjustment in the amount of the
payments to made by Wall Data to EDS and any other related
provisions to this Agreement as may be necessary or desired
as a result of the events stated above. Except as provided
in Section 9.5, in no event will this Section 7.1(d) be
grounds for termination of this Agreement unless the
parties mutually agree to so terminate this Agreement for
such a significant business change.
7.2 Cost of Living Adjustment.
(a) Adjustment. Except with respect to the period commencing on
the Effective Date and ending on November 1, 1997, if the
Consumer Price Index for all Urban Consumers, U.S. City
Average, for All Items (1982-84 = 100), as published in the
Bureau of Labor Statistics of the Department of Labor (the
"CPI"), shall on November 1st of each year during the Term,
commencing with November 1, 1998, (the "Current Index") be
higher or lower than the CPI at the previous November 1st
(such CPI, the "Base Index"), then, effective as of the
following January 1st, all charges for Services under this
Agreement attributable to the period following such January
1st (other than charges based upon then current EDS rates
and the rates for the Networking and Telecommunication
Services), as previously adjusted pursuant to this Section,
shall be increased by [*] of the percentage that the
Current Index increased from the Base Index. With respect
to the period commencing on the Effective Date and ending
on November 1, 1997, if the CPI shall on November 1, 1997
(the "November Index") be higher or lower than the CPI as
of the Effective Date (the "May Index"), then, effective as
of January 1, 1998, all charges for Services under this
Agreement attributable to the period following such January
1st (other than charges based upon then current EDS
- -----------------
* Confidential treatment requested.
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rates and the rates for the Networking and
Telecommunication Services), shall be increased by [*] of
the percentage that the November Index increased from the
May Index.
(b) Change of Index. In the event that the Bureau of Labor
Statistics should stop publishing the CPI or should
substantially change the content or format thereof, the
parties hereto shall substitute therefor another comparable
measure published by a mutually acceptable source;
provided, however, that if such change is merely to
redefine the base year for the CPI from 1982-84 to some
other year, the parties shall continue to use the CPI, but
shall, if necessary, convert either the Base Index or the
Current Index to the same basis as the other by multiplying
such index by the appropriate conversion factor.
(c) Foreign Countries. The parties agree that for any
Additional Services performed in countries other than the
United States, if the compensation for such Additional
Services is paid in the local currency, the payments for
such Additional Services will be subject to adjustment for
the cost of living in such countries using the index in
that country that is the most similar to the CPI.
7.3 Time of Payment. Any sum due EDS hereunder for which a time for
payment is not otherwise specified will be due and payable thirty
(30) days from the date of the invoice. Any sum due EDS hereunder
that is not paid when due will thereafter be subject to and bear
interest until paid at the lesser of (a) the prime rate established
from time to time by Citibank, New York N.A. plus two percent per
annum, or (b) the maximum rate of interest allowed by applicable law.
7.4 Taxes. There will be added to any charges for Services hereunder, and
Wall Data shall pay to EDS, amounts equal to any taxes or
assessments, however designated or levied, based upon such charges,
or upon this Agreement or the Software, services or items provided
hereunder by EDS, or their use, including state and local sales, use,
privilege or excise taxes based on gross revenue (or any similar
taxes or assessments in countries other than the United States), and
any taxes or amounts in lieu thereof paid or payable by EDS in
respect of the foregoing, exclusive, however, of franchise taxes,
taxes based on net income of EDS and taxes incurred by EDS pursuant
to the Washington business and occupations tax law.
7.5 Verification of Costs. The terms set forth in this Agreement are
based upon information furnished by each of the parties to the other.
Both parties believe that such information is accurate and complete.
However, if any such information should prove to be inaccurate or
incomplete in any material respect, the two parties will negotiate in
good faith to make appropriate adjustments to the provisions hereof,
including, without limitation, the charges for Services provided by
EDS.
7.6 Supporting Documentation. Upon the reasonable request of Wall Data,
EDS shall make available to Wall Data for review documentation
appropriate thereto which supports EDS' time and material charges and
out-of-pocket expenses hereunder.
--------
* Confidential treatment requested.
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ARTICLE VIII. DISPUTE RESOLUTION
8.1 Annual Quality Review. At least annually, EDS and Wall Data will meet
to review the performance of their obligations under this Agreement,
including providing Wall Data with a customer satisfaction survey and
conducting interviews with Wall Data management personnel by EDS
personnel. EDS and Wall Data will meet to review the results of each
quality review and measure continuous service improvement. In
addition, plans for future information technology activities and work
schedules will be reviewed by the parties.
8.2 Performance Review. During the course of the long-term relationship
provided for in this Agreement, disputes, controversies or claims may
arise between the parties. To minimize the expense to and impact on
each party of formally resolving such disputes, controversies and
claims, the EDS Account Director and the Wall Data Representative
will meet regularly to review the performance of each party of its
obligations under this Agreement. If the parties are unable to
resolve a dispute, controversy or claim through this performance
review process, upon the written request of either party, each party
will appoint a representative whose task it will be to meet for the
purpose of resolving the dispute, controversy or claim. Such
representatives will discuss the dispute, controversy or claim and
negotiate a resolution in good faith, without the necessity of any
formal proceeding relating thereto. No formal proceedings for the
resolution of such dispute, controversy or claim may be commenced
until either or both of the appointed representatives conclude in
good faith that amicable resolution through continued negotiation of
the matter is not likely. Except where clearly prevented by the area
in dispute, both parties agree to continue performing their
respective obligations under this Agreement while the dispute is
being resolved unless and until such obligations are terminated or
expire in accordance with the provisions hereof.
8.3 Arbitration.
(a) Procedures. Any dispute, controversy or claim arising out
of or related to this Agreement, or the creation, validity,
interpretation, breach or termination of this Agreement,
that the parties are unable to resolve through informal
discussions or negotiations pursuant to Section 8.2, will
be submitted to binding arbitration using the following
procedure:
(i) The arbitration will be held in Seattle,
Washington, or wherever both parties may
mutually agree, before a panel of three
arbitrators. Either party may demand
arbitration in writing, by serving on the other
party a statement of the dispute, controversy
or claim, and the facts relating or giving rise
thereto, in reasonable detail, and the name of
the arbitrator selected by it.
(ii) Within 30 days after such demand, the other
party will name its arbitrator, and the two
arbitrators named by the parties will, within
30 days after such demand, select the third
arbitrator.
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(iii) The arbitration will be governed by the
Commercial Arbitration Rules of the American
Arbitration Association (the "AAA"), except as
expressly provided in this Section. However,
the arbitration will be administered by any
organization mutually agreed upon by the
parties. If the parties are unable to agree
upon the organization to administer the
arbitration, it will be administered by the
AAA. The arbitrators may not amend or disregard
any provision of this Agreement or applicable
law.
(iv) The arbitrators will allow such discovery as is
appropriate to the purposes of arbitration in
accomplishing fair, speedy and cost effective
resolution of disputes. The arbitrators will
reference the rules of evidence of the Federal
Rules of Civil Procedure then in effect in
setting the scope and direction of such
discovery. The arbitrators will not be required
to make findings of fact or render opinions of
law.
(v) The decision of and award rendered by the
arbitrators will be final and binding on the
parties. Judgment on the award may be entered
in and enforced by any court of competent
jurisdiction.
(b) Enforcement. Other than those matters involving injunctive
relief as a remedy, or any action necessary to enforce the
award of the arbitrators, the provisions of this Section
are a complete defense to any suit, action or other
proceeding instituted in any court or before any
administrative tribunal with respect to any dispute,
controversy or claim arising out of or related to this
Agreement or the creation, validity, interpretation, breach
or termination of this Agreement. The provisions of this
Section will survive the expiration or termination of this
Agreement for any reason. Nothing in this Section prevents
the parties from exercising the termination rights set
forth in this Agreement.
(c) Services during Arbitration. Unless EDS is bringing an
action under this Section for nonpayment of undisputed
amounts by Wall Data or if Wall Data has failed to place a
disputed amount into escrow pursuant to Section 9.2, EDS
will continue to provide the Services, and Wall Data shall
continue to make payments to EDS in accordance with this
Agreement during the arbitration proceedings.
8.4 Sole and Exclusive Venue. SUBJECT TO THE PROVISIONS OF SECTION
8.3(b), EACH PARTY IRREVOCABLY AGREES THAT ANY LEGAL ACTION, SUIT OR
PROCEEDING BROUGHT BY IT IN ANY WAY ARISING OUT OF THIS AGREEMENT
MUST BE BROUGHT SOLELY AND EXCLUSIVELY IN THE UNITED STATES DISTRICT
COURT FOR THE WESTERN DISTRICT OF WASHINGTON AT SEATTLE OR IN THE
STATE COURTS OF THE STATE OF WASHINGTON AND EACH PARTY IRREVOCABLY
ACCEPTS AND SUBMITS TO THE SOLE AND EXCLUSIVE JURISDICTION OF EACH OF
THE AFORESAID COURTS IN PERSONAM, GENERALLY AND UNCONDITIONALLY WITH
RESPECT TO ANY ACTION, SUIT OR PROCEEDING BROUGHT BY OR AGAINST IT BY
THE OTHER PARTY; provided, however that this paragraph shall not
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prevent a party against whom any legal action, suit or proceeding is
brought by the other party in the state courts of the State of
Washington from seeking to remove such legal action, suit or
proceeding, pursuant to applicable Federal law, to the district court
of the United States for the district and division embracing the
place where the action is pending in the state courts of the State of
Washington and in the event an action is so removed, each party
irrevocably accepts and submits to the jurisdiction of the aforesaid
district court. Each party hereto further irrevocably submits to the
service of process required by the State of Washington. EXCEPT AS
PERMITTED UNDER THE IMMEDIATELY PRECEDING SENTENCE, EACH PARTY HEREBY
IRREVOCABLY COVENANTS AND AGREES NOT TO BRING ANY LEGAL ACTION, SUIT
OR PROCEEDING IN ANY WAY ARISING OUT OF THIS AGREEMENT IN ANY OTHER
COURT OR IN ANY JURISDICTION AND AGREES NOT TO ASSERT ANY CLAIM,
WHETHER AS AN ORIGINAL ACTION OR AS A COUNTERCLAIM OR OTHERWISE,
AGAINST THE OTHER IN ANY OTHER COURT OR JURISDICTION. Each party
hereto hereby irrevocably waives and agrees not to assert, by way of
motion, as a defense or otherwise, any objection which it may now or
hereafter have to the laying of venue of any of the aforesaid
actions, suits or proceedings arising out of or in connection with
this Agreement brought in the courts referred to above and hereby
further irrevocably waives and agrees not to plead or claim in any
such court that any such action or proceeding brought in any such
court has been brought in an inconvenient forum, that the venue of
the suit, action or proceeding is improper, or that this Agreement or
the subject matter hereof or thereof may not be enforced in or by
such court. As the only exception to any of the above, if a party is
entitled to seek injunctive or other equitable relief which is not
available in the venue specified in this Section, this Section shall
not be deemed to be a bar to the party seeking such relief if such
relief is wholly non-monetary injunctive or other equitable relief.
ARTICLE IX. TERMINATION
9.1 Termination for Cause.
(a) Except as provided in Section 9.1(b) and except for a
default by Wall Data in its obligation to pay EDS, if
either party materially defaults in the performance of any
of its obligations under this Agreement, which default
shall not be substantially cured within 30 days after
written notice is given to the defaulting party specifying
the default then, the party not in default, by giving
written notice to the defaulting party, may terminate this
Agreement as of a date specified in the notice of
termination.
(b) With respect to a material default which cannot reasonably
be cured within 30 days, if the defaulting party fails to
immediately (1) proceed to commence curing said default at
the beginning of such thirty-day period, (2) proceed with
all due diligence to substantially cure that default, and
(3) commit the necessary resources as described in Section
9.1(d), or if such default is not substantially cured
within 120 days after the defaulting party's receipt of
written notice specifying the default, then, the party not
in default, by giving written notice to the defaulting
party, may terminate this Agreement as of a date specified
in the notice of termination.
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(c) If either party has repeatedly committed material defaults
in the performance of any of its obligations under this
Agreement, as described in Sections 9.1(a) and (b), then
the party not in default, by giving thirty (30) days
written notice to the defaulting party, may terminate this
Agreement as of a date specified in the notice of
termination.
(d) With respect to Sections 9.1(a) and (b), each party agrees
that, upon receipt of a default notice under this Section
9.1, it will immediately commence all commercially
reasonable efforts to resolve or cure the specified default
and to commit the resources necessary, at the defaulting
party's expense, to resolve or cure the specified default
as soon as possible. If EDS is the defaulting party, Wall
Data may immediately escalate the alleged default to either
the EDS Hi-Tech Manufacturing SBU President or Vice
President of Operations for resolution.
9.2 Termination for Nonpayment. If Wall Data defaults in the payment when
due of any amount due to EDS and does not cure such default within 15
days after being given written notice of such default, then EDS, by
giving written notice thereof to Wall Data, may terminate this
Agreement as of a date specified in such notice of termination
provided, however, (a) if the nonpayment is [*] or more and is
the result of a good faith dispute regarding EDS' performance under
this Agreement, Wall Data may pay amounts claimed to be due into an
escrow account maintained by a disinterested third party, and in such
event, Wall Data shall not be in default under this Section 9.2, and
(b) if the nonpayment is less than [*] and is the result of a
good faith dispute regarding EDS' performance under this Agreement,
Wall Data and EDS shall promptly negotiate in good faith to reach a
settlement to the dispute.
9.3 Termination for Insolvency. Subject to the provisions of Title 11,
United States Code, if either party becomes or is declared insolvent
or bankrupt, is the subject of any proceedings relating to its
liquidation, insolvency or for the appointment of a receiver or
similar officer for it, makes an assignment for the benefit of all or
substantially all of its creditors, or enters into an agreement for
the composition, extension, or readjustment of all or substantially
all of its obligations, then the other party, by giving written
notice to such party, may terminate this Agreement as of a date
specified in such notice of termination.
9.4 Termination for Convenience. On each of the fourth, sixth and eighth
anniversaries of the Effective Date, Wall Data will have a one-time
option to terminate this Agreement. Wall Data may exercise its option
to terminate this Agreement on either (a) the fourth anniversary of
the Effective Date (the "First Termination Date") by notifying EDS in
writing of Wall Data's intention to terminate this Agreement at least
nine (9) months prior to such fourth anniversary, (b) the sixth
anniversary of the Effective Date (the "Second Termination Date") by
notifying EDS in writing of Wall Data's intention to terminate this
Agreement at least nine (9) months prior to such sixth anniversary;
or (c) the eighth anniversary of the Effective Date (the "Third
Termination Date") by notifying EDS in writing of Wall Data's
intention to terminate this Agreement at least nine (9) months prior
to such eighth anniversary; provided that (i) Wall Data is not then
and does not become in default under any of the terms of this
Agreement prior to the First Termination Date, the
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Second Termination Date, or the Third Termination Date, as
applicable, (and any such default is not timely cured), and (ii) on
or before the First Termination Date, the Second Termination Date, or
the Third Termination Date, as applicable, Wall Data pays to EDS the
termination fee as described in the following table (the "Termination
Fee").
Fourth Year Option The Termination Fee shall be an amount
equal to the sum of (i) the [*] for
[*] rendered [*] immediately preceding the
[*] and (ii) the [*] (as defined below).
Sixth Year Option The Termination Fee shall be an amount
equal to the sum of (i) the [*] for
[*] rendered [*] immediately preceding the
[*], and (ii) the [*].
Eighth Year Option The Termination Fee shall be an amount
equal to the sum of (i) the [*] for
[*] rendered [*] immediately preceding the
[*], and (ii) the [*].
The term "Hardware Charges" shall mean any amounts related to the
purchase or lease by EDS of hardware (with such purchases or leases
being completed with Wall Data's written consent) to be used to
provide the Services to Wall Data pursuant to this Agreement;
provided, however, that such amounts are either the non-depreciated
amounts on EDS' books for purchased hardware or the outstanding
amounts due and payable by EDS under the applicable lease for any of
such hardware. Upon EDS' receipt of payment for such Hardware
Charges, EDS will either, as applicable, convey title to, or assign
the lease of, such hardware to Wall Data.
The parties do not intend that the Termination Fee will be a penalty
or liquidated damages but that it is consideration for EDS'
accommodation of Wall Data's desire to have the ability to terminate
this Agreement prior to the Expiration Date. The parties acknowledge
and agree that, upon EDS' receipt of the Termination Fee, Wall Data
will not thereafter be held in default of this Agreement for
terminating this Agreement prior to the Expiration Date.
9.5 Termination for Change of Control. If at any time after the one year
anniversary of this Agreement, Wall Data sells all or substantially
all its assets to an unaffiliated third party or sells a sufficient
amount of its issued and outstanding stock to an unaffiliated third
party and such sale effects a change in control (for purposes of this
Section 9.5, "control" meaning the right to primarily direct and
manage the operations of Wall Data), then Wall Data may terminate
this Agreement, by, after reaching an agreement in principle to
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consummate such sale, providing EDS with at least nine (9) months
prior written notice of Wall Data's intention to terminate this
Agreement; provided that (a) Wall Data is not then and does not
become in default under any of the terms of this Agreement prior to
the termination date as specified in Wall Data's notice (the "Change
of Control Termination Date"), and any such default is not timely
cured, and (b) on or before the Change of Control Termination Date,
Wall Data pays to EDS the "Change of Control Termination Fee"
calculated as follows: (i) if the sale occurs during [*] through [*]
of this Agreement (as measured from the Effective Date), the Change
of Control Termination Fee shall be an amount equal to the [*] during
the [*] period immediately preceding the Change of Control
Termination Date, and (2) [*], (ii) if the sale occurs during [*]
through [*] of this Agreement (as measured from the Effective Date),
the Change of Control Termination Fee shall be an amount equal to the
[*] during the [*] period preceding the Change of Control
Termination Date, and (2) [*], or (iii) if the sale occurs during
[*] of this Agreement (as measured from the Effective Date), the
Change of Control Termination Fee shall be an amount equal to the
[*] during the [*] period immediately preceding the Change of Control
Termination Date, and (2) [*]. Upon EDS' receipt of payment for such
Hardware Charges, EDS will either, as applicable, convey title to, or
assign the lease of, such hardware to Wall Data.
The parties do not intend that the Change of Control Termination Fee
will be a penalty or liquidated damages but that it is consideration
for EDS' accommodation of Wall Data's desire to have the ability to
terminate this Agreement prior to the Expiration Date. The parties
acknowledge and agree that, upon EDS' receipt of the Change of
Control Termination Fee, Wall Data will not thereafter be held in
default of this Agreement for terminating this Agreement prior to the
Expiration Date.
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9.6 Transition Services upon Termination.
(a) Services. In connection with the termination of this
Agreement at the Expiration Date or by Wall Data pursuant
to Sections 9.1, 9.3, 9.4, 9.5, 11.9(b), or 11.9(c), EDS
will contribute, assist and comply with Wall Data's
reasonable directions to cause the orderly transition and
migration to Wall Data or a third party company to whom
Wall Data would be transferring the Services from EDS of
all Services then being performed by EDS (the "Termination
Transition"). Wall Data, its employees, and agents will
cooperate in good faith with EDS in connection with EDS'
obligations under this Section and Wall Data will perform
its obligations under the Transition Plan (as defined in
this Section). EDS will perform the following obligations
(and such other obligations as may be contained in the
Transition Plan) at Wall Data's expense unless otherwise
stated below or as mutually agreed in the Transition Plan.
(i) EDS and Wall Data will work together to develop
a transition plan (the "Transition Plan")
setting forth the respective tasks to be
accomplished by each party in connection with
the orderly transition and a schedule pursuant
to which the tasks are to be completed.
(ii) EDS will provide Wall Data with detailed
specifications for hardware or other equipment
which Wall Data will require to properly
perform the services and procedures previously
performed by EDS.
(iii) Wall Data may purchase from EDS at its net book
value, and subsequently assume the leases
(provided such leases are assumable) for, any
hardware owned or leased by EDS and which is
dedicated to providing the Services to Wall
Data as of the Expiration Date or the effective
date of such termination.
(iv) EDS will deliver to Wall Data and will assist
in the installation on Wall Data's hardware and
equipment the Licensed Programs (as defined in
Section 5.3) which are subject to a mutually
agreeable license agreement
(v) EDS will reasonably assist Wall Data, at Wall
Data's expense, in Wall Data's acquisition of
any necessary rights to access and use any
EDS-Vendor Software and documentation then
being used by EDS in connection with the
processing of Wall Data's information pursuant
to this Agreement.
(vi) EDS will deliver to Wall Data (a) copies of
existing documentation relating to any Wall
Data Software delivered or Licensed Program
licensed to Wall Data pursuant to paragraphs
(iv) and (v) of this Section, and (b) such
documentation for EDS Vendor Software used at
the time of termination of this Agreement by
EDS to provide the Services which is available
to EDS and which EDS is permitted to furnish to
Wall Data.
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(vii) EDS will provide appropriate training for the
Wall Data employees who will be assuming
responsibility for operation of the Software
following the Transition Termination.
(viii) Notwithstanding Section 11.7, Wall Data may
offer employment to any EDS employee who is
then dedicated to providing the Services to
Wall Data.
9.7 Regulatory Requirements. The parties agree as follows:
(a) EDS and Wall Data specifically acknowledge and agree that
this Agreement and the integrated Networking and
Telecommunication Services provided hereunder have been
negotiated and uniquely customized and tailored to satisfy
the special requirements of Wall Data.
(b) The parties further agree that if any Networking and
Telecommunication Services provided hereunder are required
by a specific decision of applicable regulatory or judicial
authority to be provided under tariff, or if a decision by
a regulatory authority at the federal, state or local level
materially alters or invalidates this Agreement, or any
material provision hereof, or if Vendor and/or LEC, in
their sole discretion, file a tariff for the Networking and
Telecommunication Services provided hereunder, then (i) EDS
will have the option to negotiate modifications to this
Agreement with Wall Data, or (ii) if the parties cannot
reach agreement, after good faith negotiations, as to
appropriate modifications to this Agreement resulting from
such regulatory requirements, then either party may
terminate this Agreement as to the Networking and
Telecommunication Services, in whole or in part, and EDS
will provide to Wall Data a pro-rata refund for any prepaid
charges, subject to any limitations set forth in this
Agreement, and Wall Data will pay to EDS any charges (such
as any Vendor termination fees) that EDS incurs as a result
of the terminated Networking and Telecommunication
Services. If any of the Networking and Telecommunication
Services are required by a specific decision of any
applicable regulatory or judicial authority to be provided
under tariff or Vendor and/or LEC file a tariff for the
Networking and Telecommunication Services provided
hereunder, and either party elects option (ii) above, then
the party electing such option shall provide to the other
written notice at least thirty (30) days prior to
termination.
(c) In no event, however, shall EDS have any liability to Wall
Data as a result of any regulatory requirements imposed by
any agency of the United States government, state or local
governments on a Vendor and/or LEC and any independent
actions which the Vendor and/or LEC may undertake which
alters the terms, conditions and methodology for providing
Networking and Telecommunication Services hereunder or
renders the provision of such Networking and
Telecommunication Services unlawful.
ARTICLE X. WARRANTIES, INDEMNITIES AND LIABILITY
10.1 Warranty and Disclaimer.
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(a) In all cases where EDS has not committed to a specific
performance standard, EDS will provide the Services in
accordance with industry practices and standards generally
applicable for such Services at the time the Services are
rendered.
(b) While EDS is primarily providing services to Wall Data
under this Agreement, EDS may from time to time provide
certain hardware, Software and other items as an incidental
part of the Services. With the exception of manufacturers'
or licensors' warranties which EDS is able to pass through
for Wall Data's benefit, such hardware, Software and other
items are provided on an "AS IS" basis without warranty. In
all cases where EDS has not committed to a specific
performance standard, EDS will use reasonable care in
providing services.
EDS will assign to Wall Data any rights it obtains under
warranties given by third party suppliers in connection
with any services, hardware, Software or other items
provided by EDS pursuant to this Agreement to the extent
that such rights are assignable. To the extent that any
such warranties are not assignable, EDS agrees that it
will, upon the request of Wall Data, take commercially
reasonable action to enforce any applicable warranty which
is enforceable by EDS in its own name. However, EDS will
have no obligation to resort to litigation or other formal
dispute resolution procedures to enforce such warranties,
unless Wall Data agrees to reimburse EDS for all expense
incurred therewith, including reasonable attorney's fees.
Subject to the foregoing sentence, in the event of a
nonconformance or other performance-related issue with
respect to any third-party Software, hardware or services
provided through EDS, EDS will coordinate and be the point
of contact for resolution of such nonconformance or
performance-related issue with the applicable vendor, and
will use commercially reasonable efforts (a) to manage such
vendor in accordance with the terms and conditions of their
respective agreement, (b) to cause the respective vendor to
promptly repair or replace the nonconforming item in
accordance with the such vendor's warranty or to remedy the
performance-related issue in accordance with the terms of
the respective vendor's agreement, and (c) to replace
nonperforming third party vendors with appropriate vendors
recommended by EDS and reasonably approved by Wall Data.
(c) EXCEPT AS SPECIFICALLY STATED IN THIS AGREEMENT, EDS MAKES
NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED,
REGARDING ANY MATTER, INCLUDING THE MERCHANTABILITY,
SUITABILITY, ORIGINALITY, FITNESS FOR A PARTICULAR USE OR
PURPOSE, OR RESULTS TO BE DERIVED FROM THE USE OF ANY
SERVICES, HARDWARE, SOFTWARE OR OTHER ITEMS PROVIDED UNDER
THIS AGREEMENT.
(d) Telecommunications Indemnification. Wall Data agrees to
indemnify, defend and hold harmless EDS from any and all
claims, actions, damages, liabilities, costs and expenses,
including reasonable attorneys' fees and expenses, arising
out of any claims related to
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(i) the abuse or the fraudulent use of the Networking and
Telecommunication Services by Wall Data and not EDS or any
its agents or subcontractors, which services are provided
or made available under this Agreement and (ii) any
information, data or message transmitted over the network
by Wall Data that constitutes libel, slander, infringement
of copyright, invasion of privacy, and/or alteration of
private records and data. Any credits received by EDS from
a Vendor or LEC as set forth in Section 2.3(d) of this
Agreement shall be passed through to Wall Data. EXCEPT AS
SPECIFICALLY STATED IN THIS AGREEMENT, EDS MAKES NO
REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED,
REGARDING THE WARRANTIES OF MERCHANTABILITY, SUITABILITY,
ORIGINALITY, FITNESS FOR A PARTICULAR PURPOSE, OR RESULTS
TO BE DERIVED FROM THE USE OF ANY NETWORKING, VOICE OR DATA
SERVICE, EQUIPMENT OR OTHER MATERIALS PROVIDED UNDER THIS
AGREEMENT.
10.2 Cross Indemnification. EDS and Wall Data each agree to indemnify,
defend and hold harmless the other from any and all damages,
liabilities, costs and expenses, including reasonable attorneys' fees
and expenses, arising out of, under or in connection with any claim,
demand, charge, action, cause of action, or other proceeding:
(a) for rent or utilities at any location where the indemnitor
is financially responsible under this Agreement for such
rent or utilities; or
(b) resulting from an act or omission of the indemnitor in its
capacity as an employer of a person and arising out of or
relating to (i) federal, state or other laws or regulations
for the protection of persons who are members of a
protected class or category of persons, (ii) sexual
discrimination or harassment, (iii) work related injury or
death, (iv) accrued employee benefits not expressly assumed
by the indemnitee, and (v) any other aspect of the
employment relationship or its termination (including
claims for breach of an express or implied contract of
employment) and which, in all such cases, arose when the
person asserting the claim, demand, charge, action, cause
of action or other proceeding was or purported to be an
employee of the indemnitor.
10.3 Intellectual Property Indemnification. EDS and Wall Data each agree
to defend the other against any action to the extent that such action
is based on a claim that Software or confidential information
provided by the indemnitor, or any part thereof, (a) infringes a
copyright perfected under United States statute, (b) infringes a
patent granted under United States law, or (c) constitutes an
unlawful disclosure, use, or misappropriation of another party's
trade secret. The indemnitor will bear the expense of such defense
and pay any damages and attorneys' fees which are attributable to
such claim finally awarded by a court of competent jurisdiction.
Neither EDS nor Wall Data shall be liable to the other for claims of
indirect or contributory infringement or for claims that the software
programs of the Wall Data-Vendor Software or EDS-Vendor Software so
infringes. If the Software or confidential information becomes the
subject of a claim under this Section, or in the indemnitor's opinion
is likely to become the subject of such a claim, then the indemnitor
may, at its option, (a) replace or
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modify the Software or confidential information to make it
noninfringing or cure any claimed misuse of another's trade secret,
or (b) procure for the indemnitee the right to continue using the
Software or confidential information pursuant to this Agreement, or
(c) replace the Software with reasonably equivalent Software which
is noninfringing or which is free of claimed misuse of another's
trade secret. Any costs associated with implementing any of the
above alternatives shall be borne by the indemnitor.
10.4 Personal Injury and Property Damage.
(a) EDS and Wall Data shall each be responsible for damages to
their respective tangible personal or real property
(whether owned or leased), and each party agrees to look
only to their own insuring arrangements (if any) with
respect to such damages.
(b) EDS and Wall Data each shall be responsible for claims for
the death of or personal injury to any person (including
any employee of either party), and claims for damages to
any third party's tangible personal or real property
(whether owned or leased), in accordance with the common
law of the jurisdiction in which such claim occurred. Each
party shall indemnify, defend and hold harmless the other
party from any and all claims, actions, damages,
liabilities, costs and expenses, including without
limitation, reasonable attorneys' fees and expenses,
arising out of claims for which the indemnitor is
responsible under the preceding sentence.
(c) EDS and Wall Data waive all rights to recover against each
other for any loss or damage to their respective tangible
personal or real property (whether owned or leased) from
any cause covered by insurance maintained by each of them,
including their respective deductibles or self-insured
retentions. EDS and Wall Data will cause their respective
insurers to issue appropriate waivers of subrogation rights
endorsements to all property insurance policies maintained
by each party.
10.5 Indemnification Procedures.
(a) Notice and Control. The indemnification obligations set
forth in this Article shall not apply unless the party
claiming indemnification:
(i) Notifies the other promptly of any matters in
respect of which the indemnity may apply and of
which the notifying party has knowledge, in
order to allow the indemnitor the opportunity
to investigate and defend the matter; provided
that the failure to so notify shall only
relieve the indemnitor of its obligations under
this Article if and to the extent that the
indemnitor is prejudiced thereby; and
(ii) Gives the other party full opportunity to
control the response thereto and the defense
thereof, including, without limitation, any
agreement relating to the settlement thereof;
provided that, the indemnitee will have the
right to participate in any legal proceeding to
contest and defend a claim for
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indemnification involving a third party and to
be represented by legal counsel of its choosing,
all at the indemnitee's cost and expense.
(b) Settlement. The indemnitor shall not be responsible for any
settlement or compromise made without its consent (provided
the indemnitor is not in material breach of its indemnity
obligations hereunder). The indemnitee agrees to cooperate
in good faith with the indemnitor at the request and
expense of the indemnitor.
10.6 Limitation of Liability.
(a) Direct Damages. Subject to Section 10.6(c), in the event
either party shall be held liable to the other for any
matter arising out of, under, or in connection with this
Agreement, whether based on an action or claim in contract,
equity, negligence, tort or otherwise, the amount of
damages recoverable against such party for all events, acts
or omissions shall not exceed, in the aggregate, the [*] of
the [*] by Wall Data to EDS under this Agreement ([*] for
[*] or [*] [*]) during the [*] immediately preceding the
date that the first such claim or action arose.
(b) Indirect Damages. Subject to Section 10.6(c), for any
matter arising out of, under, or in connection with this
Agreement, whether based on an action or claim in contract,
equity, negligence, tort or otherwise, in no event will the
measure of damages payable by either party include, nor
will either party be liable for, any amounts for loss of
income, profit or savings or indirect, incidental,
consequential, or punitive damages of any party, including
third parties.
(c) Exceptions. The limitations set forth in Sections 10.6(a)
and (b) will not apply with respect to (i) claims that are
covered by the indemnification provisions set forth in
Sections 10.1(d), 10.2, 10.3 and 10.4(b) of this Agreement,
and (ii) Wall Data's obligation to pay charges to EDS for
the Services rendered under this Agreement.
(d) Survival. The provisions of this Section 10.6 will survive
the expiration or termination of this Agreement for any
reason.
10.7 Contractual Statute of Limitations. No claim and demand for
arbitration or cause of action which arose out of an event or events
which occurred more than four years prior to the filing of a demand
for arbitration or suit alleging a claim or cause of action may be
asserted by either party against the other party.
10.8 Acknowledgment. EDS and Wall Data each acknowledge that the
limitations and exclusions contained in this Article have been the
subject of active and complete negotiation between the parties and
represent the parties' agreement based upon the level of risk to EDS
and Wall Data associated with their respective obligations under this
Agreement and the payments to be made to EDS under this Agreement.
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ARTICLE XI. MISCELLANEOUS
11.1 Right of the Parties to Engage in Other Activities. Nothing in this
Agreement will impair either party's rights to acquire, license,
market, distribute, develop for itself or others or have others
develop for the respective parties similar technology performing the
same or similar functions as the technology and the Services
contemplated by this Agreement.
11.2 Binding Nature and Assignment. This Agreement shall be binding on the
parties hereto and their respective successors and assigns. Except as
provided in Section 9.5, neither party may, nor shall have the power
to, assign this Agreement without the prior written consent of the
other party, which consent shall not be unreasonably withheld.
Notwithstanding the foregoing, EDS will have the right to subcontract
all or any portion of the Services; provided, however, that, other
than for temporary or incidental services, Wall Data has given its
written consent for the subcontracting of such services, which
consent will not be unreasonable withheld. Unless Wall Data provides
EDS with a reasonable objection to such subcontracting arrangement
within two weeks after Wall Data's receipt of notice (as provided
herein), EDS will proceed with the implementation of such arrangement
as specified in the notice. In no event shall any such subcontract
relieve EDS of any of its obligations hereunder.
11.3 Notices. Wherever under this Agreement one party is required or
permitted to give written notice to the other, such notice shall be
deemed given the third day after its mailing by one party, postage
prepaid, to the other party addressed as follows:
In the case of EDS:
Electronic Data Systems Corporation
5400 Legacy Drive
H3-5C-45
Plano, Texas 75024-3105
Attention: President Hi-Tech Manufacturing SBU
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with a copy to:
Electronic Data Systems Corporation
5400 Legacy Drive
H3-3A-05
Plano, Texas 75024-3105
Attention: General Counsel
In case of Wall Data:
Wall Data Incorporated
11332 N.E. 122nd Way
Kirkland, Washington 98034-6931
Attention:Mr. Richard H. Van Hoesen, Vice President Finance
and Chief Financial Officer
with a copies to:
Wall Data Incorporated
11332 N.E. 122nd Way
Kirkland, Washington 98034-6931
Attention:John Wall, President
and
Wall Data Incorporated
11332 N.E. 122nd Way
Kirkland, Washington 98034-6931
Attention:General Counsel
Any writing which may be mailed pursuant to the foregoing may also be
delivered by hand, telex, telegraph or telecopier and shall be
effective when received by the addressee. Either party may from time
to time specify as its address for purposes of this Agreement any
other address upon giving ten days prior written notice thereof to
the other party.
11.4 Counterparts. This Agreement may be executed in several counterparts,
all of which taken together shall constitute one single agreement
between the parties hereto.
11.5 Headings. The Article and Section headings and the table of contents
used herein are for reference and convenience only and shall not
enter into the interpretation hereof.
11.6 Relationship of Parties. EDS, in furnishing the Services to Wall Data
hereunder, is acting only as an independent contractor and under no
circumstances will EDS be deemed to be in any relationship with Wall
Data carrying with it fiduciary or trust responsibilities, whether
through
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partnership or otherwise. EDS does not undertake by this Agreement
or otherwise to perform any obligation of Wall Data, whether
regulatory or contractual, or to assume any responsibility for Wall
Data's business or operations. EDS has the sole right and obligation
to supervise, manage, contract, direct, procure, perform or cause to
be performed, all work to be performed by EDS hereunder unless
otherwise provided herein.
11.7 Hiring of Employees. During the Term and for a period of 12 months
thereafter, neither party will solicit, directly or indirectly, for
employment or employ any employee of the other without the prior
written consent of the other.
11.8 Approvals and Similar Actions. Where agreement, approval, acceptance,
consent or similar action by either party is required by any
provision of this Agreement, such action shall not be unreasonably
delayed or withheld.
11.9 Force Majeure. Each party shall be excused from performance hereunder
(other than performance of obligations to make payment) for any
period and to the extent that it is prevented from performing
pursuant hereto, in whole or in part, as a result of delays caused by
the other or third parties or an act of God, war, civil disturbance,
court order, labor dispute, or other cause beyond its reasonable
control, including failures or fluctuations in electrical power,
heat, light, air conditioning or telecommunications equipment, and
such nonperformance shall not be a default hereunder or a ground for
termination hereof. The party relieved from performance under this
Section shall use all commercially reasonable efforts and diligence
to overcome the force majeure event and continue performance of its
obligations. Notwithstanding the foregoing, in the event a force
majeure event occurs and such event lasts continuously for a period
of at least three months and, as a result of such force majeure
event, EDS is prevented from providing Services pursuant to this
Agreement, then. In addition, after such three-month period:
(a) If EDS can still perform 80% or more of the Services, then
this Agreement shall remain in effect through its Term even
though the force majeure event may continue; provided,
however, Wall Data may discontinue payments under this
Agreement to EDS related to the affected portion of the
Services which EDS is prevented from performing, and obtain
the same services from a third party.
(b) If EDS can still perform 50% to 79% of the Services, then
Wall Data may elect to either (i) continue the portion of
this Agreement relating to the Services that EDS is still
able to perform, despite the force majeure event, and
terminate the portion of this Agreement relating to the
Services affected by the force majeure event, or (ii)
terminate the entire Agreement, provided that (1) Wall Data
gives EDS prior written notice of such election to
terminate and states in such notice the termination date,
and (2) except as provided below, prior to such termination
date, Wall Data pays EDS a termination fee calculated as
follows: (x) if termination occurs in years one through
four (measured from the Effective Date), the termination
fee shall be [*] of the aggregate invoice amount described
in Section 9.4 for the fourth anniversary termination
option, plus [*] of the Hardware Charges component, (y) if
termination occurs in years five or
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six (measured from the Effective Date), the termination
fee shall be [*] of the aggregate invoice amount described
in Section 9.4 for the sixth anniversary termination
option, plus [*] of the Hardware Charges component, and
(z) if termination occurs in years eight through Term
(measured from the Effective Date), the termination fee
shall be [*] of the aggregate invoice amount described in
Section 9.4 for the eighth anniversary termination option,
plus [*] of the Hardware Charges component.
If a force majeure event occurs after the adoption and
implementation of a new disaster recovery plan negotiated
in good faith and mutually agreed to by Wall Data and EDS,
and if Wall Data elects to terminate this Agreement under
the circumstances described in this Section 11.9(b), then
Wall Data will not be required to pay EDS the termination
fees described in this Section 11.9(b); provided, however,
that Wall Data will still be required to pay EDS [*] of
the Hardware Charges and any actual and unavoidable third
party fees and charges incurred by EDS as a result of such
termination.
(c) If EDS can still perform less than 50% of the Services,
then Wall Data may elect to either (i) continue the portion
of this Agreement relating to the Services that EDS is
still able to perform, despite the force majeure event, and
terminate the portion of this Agreement relating to the
Services affected by the force majeure event, or (ii)
terminate the entire Agreement, provided that (1) Wall Data
gives EDS prior written notice of such election to
terminate and states in such notice the termination date,
and (2) prior to such termination date, Wall Data pays EDS
the Hardware Charges described in Section 9.4.
During the three-month period and for any period thereafter that EDS
is prevented from providing Services pursuant to this Section, Wall
Data may discontinue payments under this Agreement to EDS related to
the affected portion of the Services (except for actual and
unavoidable third party charges incurred by EDS).
11.10 Severability. If any term or provision of this Agreement or the
application thereof to any person or circumstances shall, to any
extent, be held invalid or unenforceable, the remainder of this
Agreement or the application of such term or provision to persons or
circumstances other than those as to which it is invalid or
unenforceable shall not be affected thereby, and each term and
provision of this Agreement shall be valid and enforceable to the
extent permitted by law.
11.11 Waiver. No delay or omission by either party hereto to exercise any
right or power hereunder shall impair such right or power or be
construed to be a waiver thereof. A waiver by either of the parties
hereto of any of the covenants to be performed by the other or any
breach thereof shall not be construed to be a waiver of any
succeeding breach thereof or of any other covenant herein contained.
Subject to the limitations set forth in this Agreement, all remedies
provided for in this Agreement shall be cumulative and in addition to
and not in lieu of any other remedies available to either party at
law, in equity or otherwise.
11.12 Attorneys' Fees. If there is any legal action with regard to the
enforcement of an award granted under Section 8.3, the prevailing
party shall be entitled to recover reasonable attorneys' fees
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and expenses and other costs incurred in that action or proceeding,
in addition to any other relief to which it may be entitled.
11.13 Media Releases. All media releases, public announcements and public
disclosures by Wall Data or EDS relating to this Agreement or its
subject matter, including, without limitation, promotional or
marketing material (but not including any announcement intended
solely for internal distribution at Wall Data or EDS, as the case may
be, or any disclosure required by legal, accounting or regulatory
requirements beyond the reasonable control of Wall Data or EDS, as
the case may be) shall be coordinated with and approved by Wall Data
and EDS prior to the release thereof.
11.14 No Third Party Beneficiary. Nothing in this Agreement may be relied
upon or shall benefit any party other than the parties hereto.
11.15 Entire Agreement. This Agreement, including any Schedules or Exhibits
referred to herein and attached hereto, each of which is incorporated
in this Agreement for all purposes, constitutes the entire agreement
between the parties with respect to the subject matter of this
Agreement and there are no representations, understandings or
agreements relating to this Agreement which are not fully expressed
herein. No amendment, modification, waiver or discharge hereof shall
be valid unless in writing and signed by an authorized representative
of the party against which such amendment, modification, waiver or
discharge is sought to be enforced.
11.16 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Washington, without giving
effect to principles of conflict of laws.
IN WITNESS WHEREOF, EDS and Wall Data have each caused this Agreement
to be signed and delivered by its duly authorized officer, all as of the
Effective Date.
ELECTRONIC DATA SYSTEMS WALL DATA INCORPORATED
CORPORATION
By: /s/ ROB LOUKS By: /s/ J. SIMPSON
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Name: Rob Louks Name: J. Simpson
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Title: Regional Vice President Title: Chief Executive Officer
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