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EXHIBIT 10.28
[ONYX LOGO]
HOSTING SERVICES DISTRIBUTOR AGREEMENT
BETWEEN
ONYX SOFTWARE CORPORATION
&
FUTURELINK DISTRIBUTION CORPORATION
EXHIBIT B
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HOSTING SERVICES DISTRIBUTOR AGREEMENT
This Hosting Services Distributor Agreement ("Agreement") executed by and
between ONYX Software Corporation ("ONYX"), a Washington Corporation with its
principal office at 330 - 120th Avenue NE, Bellevue, Washington 98005, USA, and
FutureLink Distribution Corp., with its principal office at 550-603 7 Ave SW,
Calgary, Alberta T2P 2T5, Canada ("Distributor").
WITNESSETH:
WHEREAS, Distributor has developed skills and expertise in the technology
and the use of ONYX Product(s); and
WHEREAS Distributor provides Hosting Services and wishes to market,
distribute, and support ONYX Product(s) to its Hosting Services customers;
NOW, THEREFORE, in consideration of the following terms and conditions, the
sufficiency of which the parties acknowledge, the parties agree as follows:
SECTION 1 DEFINITIONS. The following terms are incorporated herein by reference:
1.1 END-USER - An entity (customer) to whom Distributor provides ONYX
Product(s) for use solely through its Hosting Services, such use being
in the regular course of such customer's business, but specifically
not for the purpose of sublicensing.
1.2 END-USER LICENSE AGREEMENT - The form of ONYX's agreement under which
ONYX directly grants an End-User the right and license to use the
Product(s), and establishes the terms for such use.
1.3 ENHANCEMENT(S) - Computer program modifications or additions, other
than Maintenance modifications, that may be integrated with the
Product(s), and alter or upgrade the functionality of the Product(s).
ONYX, at its sole discretion, shall determine what constitutes an
Enhancement, and such Enhancements may be offered separately by ONYX
for an additional fee.
1.4 HOSTING SERVICES - Those business-to-business IT outsourcing services
advertised, marketed and sold by Distributor to its customers.
1.5 MAINTENANCE - The telephone and facsimile support, remote diagnostics,
and updates and upgrades to the Product(s), which are provided to the
End-User for an annual subscription fee.
1.6 PRODUCT(S) - License(s) for the use of one or more ONYX software
product(s) listed in Exhibit D, which may be updated periodically, as
well as the associated ONYX created documentation for use with said
Product(s) such as reference guides, user manuals, and on-line help.
Product(s) shall also include all updates, upgrades, and modifications
to those items listed in Exhibit D, as well as future products which
ONYX chooses to make available to Distributor.
1.7 PAYMENTS - Monies due to ONYX from Distributor.
1.8 PROPRIETARY INFORMATION - Any written information marked as
confidential at the time of disclosure, or any other information of
either party which, under the circumstances, reasonably ought to be
considered confidential and proprietary. Proprietary information shall
not include information which (i) is lawfully in the other party's
possession prior to the disclosure; (ii) is lawfully disclosed to such
party by a third party without restrictions on its disclosure; (iii)
is independently developed by such party; or (iv) became known to such
party from a source other than the other party other than by the
breach of an obligation of confidentiality owed to the other party.
EXHIBIT B
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1.9 TERRITORY -- is defined in Exhibit A, as either the region,
regions, country or countries, in which the Distributor has been
granted the right by ONYX to distribute ONYX Product(s) to
End-Users pursuant to the terms of this Agreement.
SECTION 2 GRANT OF RELICENSING AND OWNERSHIP
2.1 GRANT OF DISTRIBUTION: Subject to the terms and conditions of this
Agreement, ONYX hereby grants, appoints and authorizes Distributor,
on a non-transferable and non-exclusive basis, to market and
distribute the Product(s) (in their unmodified form) to End-Users
in the Territory. Distributor may not distribute the Product(s)
outside of the relevant Territory without ONYX's prior written
permission. This paragraph shall in no way limit ONYX's ability to
market, license, and support the Product(s), either directly or
indirectly, in the Territory.
2.2 OWNERSHIP: All right, title, and interest in and to the Product(s)
and Enhancements and all copyrights, patents, trademarks, or other
intellectual property or proprietary rights shall remain
exclusively with ONYX. This paragraph 2.2 shall survive termination
of this Agreement.
2.3 USE OF PRODUCT(S) BY DISTRIBUTOR: During the term of this
Agreement, Distributor may use the Product(s) solely for its own
business use and to the extent required to fulfill its marketing,
support, and Maintenance responsibilities under this Agreement.
Distributor agrees to pay ONYX the license fees for the Product(s)
and the standard annual Maintenance fees for the period which
Distributor utilizes the ONYX Product(s). Such license and
Maintenance fees will be addressed under a separate, standard ONYX
End-User License Agreement.
2.4 INTERFACES: Distributor agrees that ONYX may independently
develop, use, and distribute interfaces and products which may be
similar to the ideas, interfaces, or products of Distributor.
Distributor irrevocably waives any claims in connection with such
development, use, or distribution. The terms of this paragraph 2.4
shall survive termination of this Agreement.
SECTION 3 ORDER/PRODUCT(S) PROCEDURES
3.1 DEMONSTRATION COPIES: ONYX shall promptly provide Distributor,
copy(ies) of each Product(s) accompanied by demonstration
instructions, for Distributor's use in marketing, demonstration,
training, Maintenance, and support. Distributor shall pay ONYX an
amount equal to ONYX's reasonable cost of supply for producing &
shipping any Product(s) or documentation. Distributor shall not
make any additional copies of Product(s), other than provided for
in this Agreement, without the prior written permission of ONYX.
3.2 ORDER PROCEDURE: Distributor shall submit written purchase orders
to ONYX. ONYX shall be deemed to have accepted these purchase
orders upon either ONYX's written acceptance of the order or by
ONYX's shipment of the Product(s) to Distributor. Any purchase
order must include as a minimum, name of Product(s), installation
environment (hardware platform, operating system version, number of
users), number of copies of the Product(s) licensed, delivery point
and fees. End-User name and billing address, and other information
which ONYX may request from time to time. Distributor must also
submit to ONYX a signed End-User License Agreement in the form
attached hereto as Exhibit B, signifying End-User agrees to be
bound by ONYX's terms and conditions for the use of the Product(s).
3.3 UPDATED VERSIONS: ONYX shall delivery master copies of any updated
versions of the Product(s), including fixes, enhancements, and new
releases, promptly upon their availability, in the same form as
Distributor received the prior version. ONYX shall also deliver to
Distributor any other materials necessary for Distributor to
incorporate such updates in existing Product(s) or to supersede
prior versions. Distributor shall reimburse ONYX for all reasonable
costs of supply.
3.4 DISCONTINUANCE: ONYX reserves the right to discontinue developing,
producing, licensing, or distributing any of the ONYX Product(s)
and to modify, replace or add to the ONYX Product(s), at its sole
discretion, at any time.
Exhibit B
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SECTION 4 OBLIGATIONS OF THE DISTRIBUTOR AND ONYX
4.1 DISTRIBUTOR OBLIGATIONS
4.1.1 Distributor shall use its best efforts to market, advertise and
otherwise promote the Product(s) in the authorized Territory to
achieve the agreed revenue targets specified in Exhibit C.
4.1.2 Distributor shall use its best efforts to ensure that the ONYX
Product(s) marketed to End-Users are appropriate for the End-User's
requirements. ONYX retains the right to refuse the licensing of ONYX
Product(s) to any End-Users for which ONYX feels, in its sole
judgment, that there is not a high likelihood of success of the
End-User using the ONYX Product(s).
4.1.3 Distributor agrees to acquire and maintain throughout the term of
this Agreement, at its own expense, all permissions, consents and
licenses necessary to enable Distributor to distribute, market, and
support the Product(s) in the Territory and necessary for the full and
legal operation of this Agreement. Distributor agrees indemnify and
hold ONYX harmless from any and all claims and resulting damages
resulting from Distributor's failure to fulfill its obligations under
this paragraph. This paragraph 4.1.3 shall survive termination of this
Agreement.
4.1.4 Distributor shall comply with all applicable local laws and
regulations of the Territory relating to the marketing, distribution,
and support of the ONYX Product(s), including any export regulations
of the United States of America. Distributor shall indemnify and hold
ONYX harmless from any claims and damages resulting from Distributor's
failure to comply with the provisions of this paragraph. This
paragraph 4.1.4 shall survive termination of this Agreement.
4.1.5 Distributor may distribute the Product(s) to End-Users only after
ONYX has received the standard ONYX End-User License Agreement which
has been signed by the End-User. ONYX reserves the right to change the
terms of its standard End-User License Agreement upon thirty (30) days
written notice to Distributor. Updates, upgrades, and Enhancements to
Product(s) may require additional licensing terms not detailed in the
ONYX End-User License Agreement. Distributor may distribute the
Product(s) in object code form only. Distributor may not distribute
ONYX Product(s) for purposes of evaluation unless ONYX has previously
authorized such distribution in writing.
4.1.6 Distributor may offer End-Users installation services with regard to
the Product(s). Distributor shall negotiate the terms and conditions
of any such arrangement directly with the End-User.
4.1.7 Distributor shall offer Maintenance for the Product(s) to End-Users,
such services offered to be substantially in the form of the standard
maintenance and product support agreement, attached hereto as Exhibit
E. Distributor may charge End-Users a fee for Maintenance and Updates
at a mutually agreed-upon rate. Distributor will be responsible for
first and second tier support as well as establishing and maintaining
an adequate support team. If Distributor is unable to fulfill its
Maintenance obligations to End-Users, it shall immediately notify ONYX
of this fact. ONYX may then elect to provide these Maintenance
services to End-Users, and will charge Distributor for the cost of any
services provided. Distributor further agrees to comply with ONYX's
reasonable requests regarding both initial and ongoing training for
Distributor regarding the provision of Maintenance services to
End-Users.
4.1.8 Distributor shall not make any changes whatsoever to the ONYX
End-User License Agreement, or give any representation or assurance
that exceeds or differs from any provision of the End-User License
Agreement, including but not limited to the provisions detailing
ONYX's written limited warranty, disclaimers, and limitations of
liability. Distributor shall indemnify ONYX for all consequences of
any unauthorized representations, warranties, or guarantees so made.
Any such authorizations for additional representations, warranties, or
guarantees must be given in writing by a duly authorized ONYX employee
with authority to bind ONYX. The terms of this paragraph 4.1.8 shall
survive termination of this Agreement.
EXHIBIT B
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4.1.9 Distributor agrees not to make available to any parties, without
prior written consent from a duly authorized ONYX representative,
source code for the ONYX Product(s). Distributor will not make, or
attempt to make, any Enhancement of the Product(s) without ONYX's
prior written consent nor shall Distributor attempt to disassemble,
de-compile, or reverse engineer the ONYX Product(s) object code,
except as otherwise permitted under applicable law.
4.1.10 Any documentation created or distributed by Distributor, which
describes features of the Product(s) components, requires the prior
written approval of ONYX and may, at ONYX's discretion, require
copyright or other protection of ONYX's proprietary rights.
4.1.11 Distributor agrees to execute any and all documents necessary to
protect ONYX's Proprietary Information, as defined in Section 8 of
this Agreement, prior to providing such Proprietary Information to any
third party.
4.1.12 Distributor is obligated to implement any reasonable procedure to
restrict the use of the Product(s), as instructed by ONYX, and agrees
to notify ONYX if it discovers any unauthorized use of the Product(s).
4.1.13 Distributor may not distribute ONYX Product(s) to any third party
where Distributor knows that the third party is licensing the ONYX
Product(s) for resale or relicensing or where the third party is
reasonably considered to be a competitor of ONYX. Distributor may not
use agents for resale or relicensing of ONYX Product(s) without the
written and explicit permission of ONYX.
4.1.14 In the event of End-User default under the End-User License
Agreement, Distributor shall use its best efforts to assist ONYX in
retrieving the Product(s) from said End-User.
4.1.15 Distributor must have the capability to communicate with ONYX
utilizing the Internet (MAPI compliant) and must allow ONYX open and
unimpeded access to its servers which host the ONYX Product(s).
Distributor further agrees that it will establish open and unimpeded
access to the servers of all End-Users to provide for remote telephone
diagnostic evaluations wherever commercially practical to do so.
4.1.16 Distributor agrees that in the event that either the End-User
requests for ONYX to become involved with the implementation of the
ONYX Product(s) or that it is determined by ONYX that the Distributor
does not have the required skills to implement the ONYX Product(s),
then ONYX may elect to assume a direct role during the implementation
process.
4.1.17 Distributor shall not register, or attempt to register, in any
country in the world, any trademarks of ONYX, or any other marks
deemed by ONYX, at its sole discretion, to be confusingly similar to
existing ONYX trademarks. Distributor further agrees to cooperate and
assist ONYX (at ONYX's request and expense) with any trademark
registration efforts. The provisions of this paragraph 4.1.17 shall
survive termination of this Agreement.
4.1.18 The failure of Distributor to comply with the provisions of Section
4.1 shall constitute a material breach of this Agreement.
4.2 ONYX OBLIGATIONS
4.2.1 Upon written request by Distributor, ONYX may elect to assist in the
implementation of the Product(s) for End-Users. Payment for such
services shall be paid to ONYX by Distributor at rates which ONYX
generally charges its End-User for on site technical support services.
4.2.2 Any Maintenance or other support services for the Product(s) provided
by ONYX to Distributor shall be performed in conjunction with the
provisions of Exhibit C attached hereto. Any such services shall be
provided by ONYX only if the Product(s) are installed in a hardware
and software environment that ONYX then currently supports for its
End-Users.
EXHIBIT B
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4.2.3 ONYX shall use reasonable efforts to provide Distributor with
analysis, problem investigation and correction of errors pertaining to
the Product(s), in accord with the terms and conditions of this
Agreement.
4.2.4 ONYX shall make available to Distributor a copy of the Product(s) for
development, demonstration and support purposes. Distributor shall pay
ONYX an amount equal to ONYX's reasonable cost of supply for producing
and shipping any Product(s) and/or documentation.
4.2.5 ONYX will provide the technical personnel of the Distributor with
technical training regarding installation, use, and support of the
Product(s). Such training shall take place at the Bellevue,
Washington, USA world headquarters of ONYX, or such other location
deemed suitable by ONYX. Distributor shall pay all of its travel and
out-of-pocket expenses incurred in relation to said training and
Distributor shall reimburse ONYX for the cost of training if such
training takes place in any location other than ONYX's world
headquarters.
4.2.6 ONYX will from time to time supply Distributor at no charge 5 copies
of ONYX's current advertising and marketing materials for use by
Distributor in marketing the Product(s). Any additional copies of
marketing materials will be charged to the Distributor at the
published rate.
4.2.7 Distributor shall be entitled to Maintenance fees of 9% of
then-current ONYX list price for Product(s) licenses purchased for
Distributor's use in its normal course of business, provided
Distributor performs all upgrades and ongoing support for such
Product(s).
SECTION 5 PRODUCT SHIPMENT, PAYMENT, AND INVOICE TERMS
5.1 PRODUCT SHIPMENT. After receiving Distributor's order for the
Product(s) in accord with Section 3.2 of this Agreement, ONYX shall
ship to Distributor the Product(s).
5.2 PAYMENTS TO ONYX. Upon shipment of the Product(s) to Distributor under
the provisions of paragraph 5.1 above, ONYX shall invoice Distributor
for all license and Maintenance fees due to ONYX by Distributor under
the provisions of Exhibit C attached hereto. All such moneys owed to
ONYX by Distributor shall be due 30 days after receipt of invoice by
Distributor. ONYX shall not be subject to any payment terms offered to
End-User by Distributor, and Distributor shall pay ONYX for all orders
submitted to and accepted by ONYX regardless of whether Distributor
receives payment from End-User.
5.3 END-USER PAYMENT. Distributor shall have responsibility for
establishing prices and collecting fees from End-Users for Product(s)
licensed under any End-User License Agreement.
5.4 DELINQUENT PAYMENTS. If any payment due ONYX hereunder shall remain
unpaid for thirty (30) days following the date due, ONYX may impose
interest thereon at 1.0% per month (12% APR), or at the maximum rate
allowed by law, if lower, until paid.
5.5 TENDER AND PAYMENT. All amounts to be paid under this Agreement are
payable in U.S. Dollars currency and all payments due hereunder shall
be made payable to ONYX and forwarded to ONYX at its world headquarters
or other location designated by ONYX, ATTN.: CHIEF FINANCIAL OFFICER.
ONYX reserves the right to halt shipment of any of the Product(s), in
whole or in part, in the event of any delinquency in Payment for any
prior order or shipment.
5.6 PRICE ADJUSTMENTS. ONYX reserves the right to adjust the pricing of its
Product(s) and Maintenance services upon written notification to
Distributor, provided that such notification is at least thirty (30)
days prior to any such changes. Distributor will make Payments based on
a revised ONYX list price for any licenses of the Product(s)
subsequently distributed to End-Users in Distributor's Territory.
5.7 TAXES. Distributor shall collect, report, and pay to the relevant
taxing authority, any property, customs excise, sales and/or use, or
similar taxes (other than taxes on ONYX's income generally) that arise
under
EXHIBIT B
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this Agreement. Distributor agrees to indemnify and hold ONYX harmless
from any claims or damages resulting from Distributor's failure to comply
with this paragraph. This paragraph 5.7 shall survive termination of this
Agreement.
SECTION 6 MARKETING
6.1 PUBLICITY AND ADVERTISEMENT. The parties may elect to issue a joint press
release announcing their relationship under this Agreement. No such
announcements or advertising will be made by either party without the
consent of the other.
6.2 TRADEMARKS. Each party may, free of charge, utilize the other's trademark
in marketing of the Product(s) upon written mutual agreement and in accord
with the provisions of paragraph 14.11.
SECTION 7 REPORTING AND AUDITING REQUIREMENTS
7.1 For each month in which Distributor distributes at least one copy of one
Product, Distributor shall, with respect to each new license, provide
ONYX: (i) name, address, and contact of the End-User; (ii) operating
environments(s), projected installation date, and effective date of
Product(s) Maintenance; and (iii) amount of license or Maintenance
payments due from End-User to Distributor. Regardless of the number of
licenses granted, Distributor shall provide ONYX a written summary of
Product(s) sold for each quarter of Distributor's fiscal year. Such
summary shall include year-to-date Payments and additional fees remitted
to ONYX, taxes remitted to ONYX or the appropriate taxing authority which
are associated with each End-User License Agreement, as well as the
monthly totals of such payments, fees and taxes remitted by Distributor
for that quarter.
7.2 Upon prior notice, ONYX or its independent accountants may examine, during
normal Distributor business hours, Distributor's books and records to
verify any amounts due, payable, and/or paid under this Agreement. If
Distributor undergoes a certified audit, such audit shall, at ONYX's option
and expense, verify the respective Payments and other fees and taxes due,
payable and/or paid hereunder. Failure by Distributor to notify ONYX in a
timely manner of the acquisition of additional licenses by an End-User
shall constitute a breach of Distributor's material obligations under this
Agreement.
SECTION 8 CONFIDENTIALITY
8.1 AGREEMENT. Distributor shall not disclose the terms of this Agreement to
anyone other than (i) its employees who reasonably acquire such knowledge
in the ordinary course and scope of their employment; (ii) its agents or
representatives whose assigned duties reasonably require such disclosure:
or (iii) End-Users, to the extent necessary to distribute the Product(s).
Distributor shall take all reasonable steps to ensure that the terms of
this Agreement are not disclosed further by its employees, agents or
representatives or by any End-User, its employees, agents or
representatives.
8.2 PRODUCT(S). Distributor agrees that the Product(s), together with all
materials and knowledge related thereto, obtained by Distributor pursuant
to this agreement shall be held in confidence and shall not be made
available in any form for the use or benefit of any person or entity other
than Distributor and/or End-Users without the prior written consent of
ONYX. Notwithstanding the foregoing, ONYX agrees that Distributor and/or
End-Users shall be permitted to disclose relevant aspects of the
Product(s) to their employees and agents to the extent reasonably
necessary for Distributor or End-Users use of Product(s); provided that
Distributor and/or End-User shall take all reasonable steps to ensure that
Product(s) are not further disclosed or duplicated. Neither Distributor
nor End-Users shall allow any attachment, levy, or execution upon or
against the Product(s), and each shall immediately notify ONYX in writing
regarding any such attempt.
8.3 OTHER ONYX INFORMATION. Distributor agrees to hold materials and knowledge
regarding other ONYX Product(s) it is evaluating or reviewing for
inclusion in this Agreement, or for general knowledge, as well as all
other ONYX Proprietary Information, confidential to the same degree as
Product(s), ONYX
EXHIBIT B
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reserves the right to designate in writing which of its Proprietary
Information may be disclosed by Distributor under the provisions of
this Agreement.
8.4 DISTRIBUTOR INFORMATION. ONYX and its employees, agents or
representatives shall not use, duplicate or disclose to any third party
such Proprietary Information of Distributor without Distributor's prior
written consent, except to the extent reasonably necessary for the
performance of ONYX obligations under this Agreement. ONYX shall take
all reasonable steps to ensure Distributor's Proprietary Information
hereunder is not used, duplicated, or disclosed in contravention of
this Agreement.
8.5 DISCLOSURE REQUIRED BY LAW. Nothing in this Section shall restrict
disclosure by either party required by any applicable law, or
regulation, or the order of any court or administrative agency having
jurisdiction regarding such matters. However, either party shall
promptly upon receiving notice of any required disclosure, notify the
other in writing, providing all information and assistance for such
party to defend its rights hereunder.
8.6 INJUNCTIVE RELIEF. In the event of a breach of the provisions of this
Section 8, ONYX shall be entitled to obtain injunctive relief or other
equitable relief from a court of competent jurisdiction to restrain
the use or disclosure of its Proprietary Information. Such remedy
shall be in addition to, and not in lieu of, any other remedies
provided for in this Agreement.
8.7 MATERIAL BREACH. Failure to adhere to the provisions of this Section 8
shall be considered a material breach of the Agreement.
8.8 SURVIVAL. The confidentiality obligations of this Agreement shall
survive its termination.
SECTION 9 WARRANTIES
9.1 EXPRESS WARRANTY. ONYX warrants, solely to Distributor, that the
Product(s) will perform in substantial compliance with the Product(s)
documentation for ninety (90) days from ONYX's delivery of Product(s)
to Distributor. ONYX's sole responsibility, and Distributor's sole
remedy under such warranty, shall be, at ONYX's option, to repair,
replace, or correct any defect in the Product(s) or their related
documentation or refund to Distributor the amount paid by Distributor
to ONYX for the Product(s) which gave rise to such claim. The warranty
contained in this Paragraph 9.1 is contingent upon proper use of the
Product(s), and shall not apply if the Product(s) are modified,
altered or changed, or if the Product(s) are used in a hardware or
software environment which ONYX does not support at the time of such
use. ONYX does not warrant that the Product(s) will meet either
Distributor's requirements, or that the operation or use of any of the
Product(s) will be uninterrupted or error free.
9.2 DISCLAIMER OF WARRANTIES. DISTRIBUTOR EXPRESSLY AGREES AND ACKNOWLEDGES
THAT THE FOREGOING WARRANTY IN PARAGRAPH 9.1 IS IN LIEU OF ANY AND ALL
OTHER ONYX WARRANTIES, EXPRESS OR IMPLIED. ONYX, ON BEHALF OF ITSELF
AND ITS SUPPLIERS, DISCLAIMS ANY AND ALL OTHER REPRESENTATIONS OR
WARRANTIES OF ANY KIND WHATSOEVER, EITHER EXPRESS OR IMPLIED,
INCLUDING, BUT NOT LIMITED TO, ANY IMPLIED WARRANTY OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE. DISTRIBUTOR AGREES THAT THE
DISCLAIMER IS REASONABLE AND THAT DISTRIBUTOR HAS HAD ADEQUATE PRIOR
OPPORTUNITY TO ASSESS FULLY THE OPERATION AND PERFORMANCE OF THE
LICENSED SOFTWARE AND ANY UPDATE AND UPGRADE. DISTRIBUTOR SHALL NOT
TAKE ANY CONTRARY OR INCONSISTENT POSITION.
9.3 The terms of this Section 9 shall survive termination of this
Agreement.
SECTION 10 REMEDIES/LIMITATION OF LIABILITY
EXHIBIT B
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10.1 LIMITATION OF ONYX LIABILITY. DISTRIBUTOR AGREES THAT THE
CUMULATIVE LIABILITY OF ONYX AND ITS SUPPLIERS FOR ANY DAMAGES
ARISING FROM OR RELATED TO THIS AGREEMENT, INCLUDING BUT NOT
LIMITED TO CLAIMS FOR BREACH OF CONTRACT, BREACH OF WARRANTY,
NEGLIGENCE, OR TORT, SHALL NOT EXCEED ANY AMOUNT PAID BY
DISTRIBUTOR TO ONYX FOR THE PRODUCT(S) WHICH GAVE RISE TO SAID
CLAIM.
10.2 LIABILITY DISCLAIMER. ONYX, ON BEHALF OF ITSELF AND ITS
SUPPLIERS, DISCLAIMS ANY AND ALL LIABILITY FOR SPECIAL, INCIDENTAL
OR CONSEQUENTIAL DAMAGES (INCLUDING LOSS OF PROFITS) ARISING FROM
OR RELATED TO THIS AGREEMENT OR WITH RESPECT TO THE INSTALLATION,
IMPLEMENTATION, CUSTOMIZATION, USE, OPERATION OR SUPPORT OF THE
PRODUCT(S) EVEN IF ONYX OR ITS SUPPLIERS HAVE BEEN APPRISED OF THE
POSSIBILITY OF SUCH DAMAGES.
10.3 TIME LIMITATION. Any legal proceeding based upon this Agreement
must be instituted within two (2) years of the date the cause of
action first accrued.
10.4 ALLOCATION OF RISK. Both parties acknowledge that the allocation
of risk contained in this Section 10 is reflected in the price for
the Product(s) and is also a reasonable recognition of the fact
that the Product(s) cannot be tested in every possible combination
and it is not within ONYX's control how and for what purpose the
Product(s) are used by Distributor or End-Users.
10.5 SURVIVAL. The terms of this Section 10 shall survive termination
of this Agreement.
SECTION 11 TERM/TERMINATION
11.1 TERM. The initial term of this Agreement shall be fourteen (14)
months, commencing November 1, 1998, unless earlier terminated
pursuant to this Section 11, or by the mutual written agreement
of the parties. At the end of the initial term, this Agreement
shall renew for one additional year if (i) Distributor has met the
agreed upon annual revenue targets as detailed in Exhibit C
attached hereto: and (ii) both Distributor and ONYX mutually agree
to such an extension. Any expiration or termination of the term
will be final and absolute. Distributor waives any right, either
express or implied by applicable law or otherwise, to renewal of
this Agreement or to any damages or compensation for the
expiration or termination of the term in accordance with this
Section 11. Each of the parties has considered the possibility of
such expiration or termination and the possibility of loss and
damage resulting therefrom in making expenditures pursuant to the
performance of this Agreement. It is the express intent and
agreement of the parties that neither will liable to the other for
damages or otherwise by reason of the expiration or termination of
the term as provided for herein.
11.2 INSOLVENCY, BANKRUPTCY, ETC. If either party becomes insolvent,
fails to pay, or admits in writing its inability to pay, debts as
they become due; or if either party applies for, consents to, or
acquiesces in the appointment of a trustee, receiver or other
custodian for such party or for a substantial part of such party's
property; or makes a general assignment for the benefit of
creditors; or, if a trustee, receiver or other custodian is
appointed for such party or for a substantial part of such party's
property and is not discharged within sixty (60) days; or if any
bankruptcy, reorganization, debt arrangement or other proceeding
under any bankruptcy law, or any dissolution or liquidation
proceeding is commenced by, consented to, or acquiesced in by
such party and remains for sixty (60) days undismissed; or, if
either party ceases to conduct its business in the normal course,
this Agreement may be terminated by the other party immediately
upon written notice without penalty of any kind.
11.3 BREACH OF AGREEMENT. In the event either party fails to perform
any of its material obligations hereunder, the other may notify
the non-complying party in writing of the breach. If the
non-complying party fails to remedy the breach within thirty (30)
days from receipt of such notice, or, if the breach is not
remediable within such period and the party in breach has not
undertaken and thereafter diligently and successfully pursued
significant efforts to cured the breach, the non-breaching party
may immediately terminate this Agreement upon written notice to
the non-complying party. This right to terminate shall be
Exhibit B
10
in addition to, and shall in no way limit the non-breaching party from
pursuing other relief, except as otherwise limited herein.
11.4 EFFECT OF TERMINATION. Termination of this Agreement for any reason
shall immediately terminate Distributor's rights under this Agreement
and Distributor shall return to ONYX all proprietary materials, and
other materials developed by or belonging to ONYX which have been
received by Distributor pursuant to this Agreement. Any End-User
License Agreements shall survive termination of this Agreement. Upon
termination of this Agreement, Distributor shall continue providing
Maintenance to all End-Users until alternate Maintenance services are
arranged for End-Users. Termination of this Agreement shall not
relieve Distributor of its obligations to make immediate and full
payment to ONYX for any amounts then due and/or payable.
SECTION 12 INDEMNIFICATION
12.1 INDEMNIFICATION OF DISTRIBUTOR. ONYX will defend or settle, at its own
expense but under its sole direction and contingent on Distributor's
total cooperation, any claim alleging that any Product in its
unmodified form infringes any patent, trademark or copyright. If any
ONYX Product(s) becomes the subject of such a claim, ONYX reserves the
right, at its sole option, to either 1) modify or replace the affected
parts so the ONYX Product(s) become non-infringing, 2) obtain for
Distributor and any End-Users the right to continue to use the
Product(s), or 3) terminate this Agreement immediately if options 1
and 2 listed above are commercially impracticable. In no event shall
Distributor settle any such claim, lawsuit, or proceeding without
ONYX's prior approval, and ONYX shall have no liability for any such
unapproved settlement so made. This paragraph states the entire
liability of ONYX for any infringement involving the ONYX Product(s).
12.2 INDEMNIFICATION OF ONYX. Distributor, on behalf of itself and its
agents, will indemnify and hold harmless any award of costs and
damages brought against ONYX to the extent that it is (i) based on a
claim regarding the installation or configuration of Product(s) by
Distributor or its agents; or (ii) based on a claim regarding
modification, translation, customization or localization to the
Product(s) by Distributor or its agents. Distributor shall have the
right to control the defense of all such claims, lawsuits, and other
proceedings. In no event shall ONYX settle any such claim, or
proceeding without Distributor's prior approval, and Distributor
shall have no liability for any such unapproved settlement so made.
12.3 SURVIVAL. The provisions of this Section 12 shall survive termination
of the Agreement for any reason.
SECTION 13 DISPUTE RESOLUTION/ARBITRATION
13.1 DISPUTE RESOLUTION/ARBITRATION PROCEDURES. Any controversy arising
from or relating to this Agreement, shall be determined by arbitration
in Washington State, United States of America, in accordance with
then-prevailing Commercial Arbitration Rules. Such arbitration shall
be conducted in the English language, and all documents submitted in
conjunction with the arbitration shall be in English. The parties
shall agree upon one commercial arbitrator knowledgeable in the
subject matter hereof. Absent agreement, such arbitrator shall be
appointed by the Commercial Arbitration Association. The award
rendered by the arbitrator shall be final and conclusive. The
prevailing party shall be entitled as part of the arbitration award,
to the reasonable costs and expenses (including attorneys' fees) of
investigating, preparing and pursuing an arbitration claim as may be
awarded by the arbitrator; and the party enforcing any award shall be
entitled to reasonable costs and expenses (including attorneys' fees)
expended or incurred in connection with such effort. Any award to
either party as a result of arbitration shall be subject to the
limitations detailed in Section 9 and Section 10 of this Agreement,
and in no event shall either party be awarded punitive damages under
said arbitration. Notwithstanding the foregoing, either party may seek
preliminary, Interim, or permanent injunctive relief or seek to
enforce an arbitration award under this Agreement from any court
having jurisdiction over the matter in dispute. This Section 13 shall
survive termination of this Agreement.
EXHIBIT B
11
SECTION 14 MISCELLANEOUS GENERAL PROVISIONS
14.1 PERSONNEL. Personnel of ONYX and Distributor are not, nor shall they be
deemed to be, employees of the other. Each party shall be and remain an
independent contractor and nothing herein shall be deemed to constitute the
parties as partners. Neither party shall have any authority to act, or
attempt to act, or represent itself directly or by implication, as an agent
or in any manner assume or create any obligation on behalf of or in the
name of the other, nor shall either be deemed the agent or employee of the
other. Distributor shall have no authority to appoint any other dealer or
re-marketer of the ONYX Product(s). Each party will be solely responsible
for payment of all compensation, employment-related taxes, and insurance
regarding its respective personnel. Each party shall be solely liable for
any claims made by its personnel for injuries to persons or property damage
during the performance of services hereunder.
14.2 DIRECT REPRESENTATION. Distributor agrees that ONYX will have the right at
any time in the future to set up ONYX direct operations in distributor
Territory(s) to offer solutions and sales support to End-Users.
14.3 FORCE MAJEURE. Except for payments due ONYX from Distributor pursuant to
this Agreement, neither party shall be liable for delays in its performance
hereunder due to causes beyond its reasonable control, including but not
limited to, Acts of God, acts of public enemy, acts of government or courts
of law or equity, civil war, insurrection or riots, fires, floods,
explosions, earthquakes or other casualties, strikes or other labor
troubles.
14.4 NOTICE. All notices given to either party, shall be by certified mail or by
regular overnight delivery service, addressed as follows:
FOR DISTRIBUTOR:
Futurelink Distribution Corporation ONYX Software Corporation,
550-603 7 Ave SW 330 - 120th Avenue N.E.
Calgary, AB T2P2T5, CANADA Bellevue, WA 98006, USA
Attn.: Chief Executive Officer Attn.: Chief Executive Officer
14.5 SUCCESSORS. No assignment or transfer of this Agreement or any right or
privilege granted hereunder, including any assignment by operation of law
pursuant to a merger, liquidation, foreclosure, or involuntary sale in
bankruptcy, shall be permitted of Distributor or shall be effective or
binding on ONYX without ONYX's prior written consent. Subject to the
foregoing limitation, this Agreement shall inure to the benefit of and be
binding upon the parties hereto, their successors, and assigns.
14.6 VALIDITY OF AGREEMENT. If any provision of this Agreement shall be held
illegal, unenforceable, or in conflict with any law of a federal, state, or
local government having jurisdiction over this Agreement, the validity of
the remaining portions or provisions hereof shall not be affected thereby.
14.7 GOVERNING LAW. This Agreement shall be construed in accordance with and by
governed by laws of the State of Washington, United State of America,
excluding conflict of laws interpretations. The United Nations Convention
on Contracts for the International Sale of Goods shall not apply.
14.8 AMENDMENTS IN WRITING. No amendment, modification, or waiver of any
provision of this Agreement shall be effective unless it is set forth in a
writing that refers to this Agreement (must include Agreement Number) and
the provisions so affected and is executed by an authorized representative
of both parties. No failure or delay by either party in exercising any
right, power, or remedy will operate as a waiver of any such right, power,
or remedy.
14.9 EXPIRATION. This Agreement shall be valid only if executed by both parties
within thirty (30) days of first execution.
EXHIBIT B
12
14.10 ENTIRE AGREEMENT. This Agreement and its attached Exhibits
constitute the entire agreement between the parties regarding the
subject matter; superseding all previous communications,
representations or agreements, either written or oral, with
respect to the subject matter.
14.11 USE OF ONYX TRADEMARKS. ONYX grants to Distributor the limited
permission to use both ONYX's trademarks and registered
trademarks solely to identify ONYX Product(s) acquired from ONYX
under this agreement. Distributor shall use ONYX's trademarks and
registered trademarks only for purposes of advertisement,
promotion, and distribution of the corresponding ONYX Product(s)
and for no other purposes. Distributor shall use such trademarks
and registered trademarks in accord with the guidelines
established by ONYX from time to time and shall not use such
marks in any manner likely to confuse or mislead the public, or
to be adverse to the best interests of ONYX.
14.12 RE-EXPORT OF ONYX PRODUCT(S). Distributor shall not export or
re-export any ONYX Product(s) or technology to any country
specified as a prohibited destination in applicable U.S. laws,
regulations, or ordinances. Distributor further agrees to comply
with any similar laws in any nation where Distributor is
representing ONYX. Distributor agrees to defend, indemnify and
hold harmless ONYX from any claim, loss liability, expense or
damage (including fines or legal fees) incurred by ONYX to
Distributor's violation of the terms of this provision.
14.13 SURVIVAL. The terms of this Section 14 shall survive
termination of this Agreement.
SECTION 15 EXHIBITS
15.1 The following Exhibits are incorporated by reference:
EXHIBIT A Territory Authorization
EXHIBIT B ONYX Software License Agreement
EXHIBIT C Pricing to Distributor/Revenue Targets
EXHIBIT D ONYX Product(s) and Maintenance Price List
EXHIBIT E Maintenance and Product Support
IT WITNESS WHEREOF, the parties have executed this Agreement effective
as of the date below.
DISTRIBUTOR: ONYX:
BY: /s/ Cameron Chell BY:
------------------------------- ---------------------------------
NAME: Cameron Chell NAME:
----------------------------- -------------------------------
TITLE: CEO, Chairman TITLE:
---------------------------- ------------------------------
DATE: November 12, 1998 DATE:
----------------------------- -------------------------------
Exhibit B
13
EXHIBIT A
TERRITORY AUTHORIZATION
GEOGRAPHIC TERRITORY: Subject to the terms and conditions of this Agreement,
Distributor is granted the non-exclusive right to distribute ONYX Product(s) in
the following territory: North America.
VERTICAL MARKET SEGMENTS: Without limiting ONYX's other rights to appoint
Distributors and/or resellers in the Territory, ONYX expressly reserves the
right to appoint vertical value added resellers, from time to time, which may
have the right to market and sell the ONYX Product(s) in conjunction with their
own solutions, on a global, regional or country basis. ONYX agrees to inform
Distributor of subsequent appointments.
PROSPECTS/PIPELINE: Distributor shall inform ONYX of all potential prospective
End-Users by (i) notifying their ONYX Channel Manager of such prospects in a
timely fashion; and (ii) completing all reasonably necessary reports as may be
requested from time to time. If ONYX requests Distributor to withdraw from any
End-User account owing to potential conflict or if in ONYX's opinion the ONYX
Product(s) appears not to be a suitable solution for the prospect, Distributor
will accept ONYX's decision and immediately comply with the request.
DISPUTES/ARBITRATION: With regard to any territorial disputes between
Distributor and vertical value added resellers involving End-Users, prospects,
or territory definitions, ONYX shall be the sole source of dispute resolution.
Distributor agrees that all decisions made by ONYX with regard to Territories
will be binding and that Distributor will comply with all decisions.
Distributor irrevocably waives any claims it may have against ONYX in this
regard.
Exhibit A
14
EXHIBIT B
ONYX SOFTWARE LICENSE AGREEMENT
Exhibit B
15
EXHIBIT C
PRICING TO DISTRIBUTOR/REVENUE TARGETS
PRODUCT(S) PRICING:
During the term of this Agreement Distributor may order Product(s) from ONYX in
accord with the terms and conditions of this Agreement at ONYX's then-current
list price, as established by ONYX from time to time, reduced by the Discount
Rate listed in the table below. The Tier 1 Discount Rate shall apply to Product
license fees until such time as license fees paid by Distributor to ONYX during
any calendar year exceed the amount listed in Tier 1 in the table below.
Distributor may then order additional Product(s) from ONYX during that calendar
year at the Tier 2 Discount Rate. After such time as license fees paid by
Distributor to ONYX during that same calendar year exceed the amount listed in
Tier 2 in the table below, Distributor may order additional Product(s) from ONYX
during that calendar year at the Tier 3 Discount Rate.
??? ???? ?????
- ---------------------------------------------------------
1 20% $0 to $500,000
- ---------------------------------------------------------
2 25% $501,000 to $750,000
- ---------------------------------------------------------
3 30% $751,000+
- ---------------------------------------------------------
MAINTENANCE PRICING:
For each End-User to whom Distributor provides Maintenance services,
Distributor shall pay to ONYX 18% of the then-current US Product license fees
for the Product(s) provided to the End-User. In the event that Distributor
issues a purchase order for Product(s) exceeding $199,999 in license fees for
one End-User, Maintenance fees associated with that order shall be entitled to
the Discount Rate applied to that license. In exchange for the fees detailed
herein, Distributor shall receive the following services from ONYX:
o Rollout support. ONYX shall provide direct support to End-Users for
sixty (60) days after execution of the ONYX Software License Agreement.
o Third level support. ONYX shall provide Distributor with telephone support
from 9am to 5pm Pacific time, assisting Distributor in its attempts to
service its End-Users. Such assistance by ONYX shall be in the English
language. In the event ONYX determines, in its sole discretion, that
Distributor's is excessively requesting such telephone support, ONYX
reserves the right to charge Distributor for such additional services.
o Updates and upgrades to the Product(s). ONYX shall provide to Distributor
all commercially released updates and upgrades to the Product(s) for each
of Distributor's End-Users who are participants in Distributor's maintenance
and product support program. ONYX reserves the right to charge Distributor
for any reasonable documented third party costs associated with any such
upgrades to the Product(s). ONYX reserves the right to determine, at its
sole discretion, what constitutes an update or an upgrade to the Product(s).
Physical installation of any such updates or upgrades is the responsibility
of the Distributor.
o Training. ONYX shall provide training for two (2) members of Distributor's
support team.
EXHIBIT C
16
Distributor will receive support services as listed in this Exhibit C for the
current release of the Product(s) and all other releases whose version number
begins with either the same number, or the previous number. For example, if the
current release is version 4.5, ONYX will support only those versions between
3.0 and the current release.
REVENUE TARGETS:
The annual revenue targets for Distributor shall be as follows:
???? ???? ????
Year 1 $400,000 $72,000
Year 2 $1,000,000 $180,000
The above figures represent net revenues paid to ONYX in US Dollars, and shall
be broken down into mutually agreeable quarterly targets.
Distributor's failure to meet the revenue targets detailed above shall
constitute a material breach of this Agreement.
EXHIBIT C
17
EXHIBIT D
ONYX SOFTWARE PRODUCTS AND MAINTENANCE
PRODUCT LIST:
ONYX Customer Center
ONYX Customer Center-Unplugged
ONYX Customer Center Server
ONYX Insight
ONYX Web Wizards for Sales
ONYX Web Wizards for Support
ONYX Channel Connect
Please consult your ONYX representative for the current US price list. This
list will be adjusted and updated periodically.
MAINTENANCE PRICE LIST:
ONYX's standard rate for Maintenance services is 18% of the retail
(non-discounted) price of the Product(s). Maintenance fees for any Product(s)
acquired during an existing Maintenance Period are prorated so as to be
co-terminus with the then existing Maintenance period. Maintenance for the
first year for any End-User is mandatory.
EXHIBIT D
18
EXHIBIT E
MAINTENANCE AND PRODUCT SUPPORT
I MAINTENANCE SERVICES
Upon payment of annual Maintenance fees by End-User, Distributor will use
commercially reasonable efforts to provide the following Maintenance
services for the Product(s).
A. Telephone Support
End-User will receive technical support for the Product(s).
Distributor shall make available technical staff to assist with
questions about the Product(s) and to assist End-User in solving
problems with the Product(s). The hours of operation for technical
support are 9:00AM to 5:00PM, local time, during normal business
hours (Monday through Friday), excluding holidays. Distributor shall
designate a specific technical support representative as End-User's
key contact. Distributor will provide a response, but not
necessarily a solution, within four (4) normal business hours, as
defined in this Agreement, upon notification by End-User to
Distributor of problems or defects with the Product(s).
B. Support of Previous Versions of Product(s)
End-User will receive support services as listed in this Schedule 1
for the current release of the Product(s) and all other releases
whose version number begins with either the same number, or the
previous number. For example, if the current release is version 4.5,
Distributor will support only those versions between 3.0 and the
current release. If End-User desires support for earlier versions of
Product(s), such support will be treated as a consulting project,
and End-User will be billed according to prevailing consulting
rates.
C. Product(s) and Documentation Updates and Upgrades:
End-User will receive all modifications to the Product(s) designated
as error corrections, bug fixes, patches, and updates, as well as
updates to the Product(s) and ONYX created documentation. End-User
will receive, without additional charge, all commercially released
updates and upgrades to the Product(s), provided that End-User is a
participant in Distributor's maintenance and product support program
at the time of the release of the update or upgrade. Notwithstanding
the foregoing, End-User may be charged for any documented third
party costs associated with any commercially released upgrade.
II END-USER RESPONSIBILITIES
A. Remote Diagnostics
End-User shall provide Distributor and its suppliers with the
necessary remote access to the End-User's designated CPU so that
Distributor may provide remote dial-in support services as needed by
End-User.
B. End-User's Designated Contact
End-User shall appoint one individual within End-User's organization
to serve as a primary contact and to receive support through the
telephone support center.
C. End-User's Dedicated Resource to the Product(s)
End-User shall appoint at least one individual within its
organization who is familiar with all modifications, customizations
or extensions to the Product(s), and has access to any and all
source code related to same. Such individual shall act as the
primary contact for any support calls involving such modifications,
customizations or extensions to the Product(s).
III LIMITATIONS
A. Support of Customizations, Modifications or Extensions to Product(s)
Distributor will use commercially reasonable efforts to assist
End-User in its attempts to remedy any problems with the Product(s)
resulting from any customizations, modifications, or extensions to
the Product(s), regardless of by who such customizations,
modifications, or extensions were performed. If End-User is unable
to remedy said problems, Distributor will, upon End-User's request,
treat such problems as consulting projects and shall bill for its
services at its then current professional services rates.
IV MAINTENANCE TERMS
A. In no event shall Distributor be responsible for providing
Maintenance services for a period during which Maintenance coverage
lapsed.
B. If End-User elects to resume Maintenance after a lapse of coverage,
End-User shall pay for the period of time in which Maintenance
coverage lapsed. End-User's payment for the lapsed period shall be
the then current annual Maintenance fee, prorated for the number of
months that coverage lapsed. To resume Maintenance after a lapse of
coverage, End-User must purchase a minimum of one full year's
Maintenance beyond the lapsed period. If End-User resumes coverage
after a lapse of coverage, the Maintenance renewal date shall be
changed to the date on which End-User paid all Maintenance fees for
the lapsed period and a minimum of one additional year of
Maintenance.
C. The term of the maintenance and product support program is for one
year. Any revisions or changes in the terms of the maintenance and
product support program shall occur only at the end of End-User's
then current Maintenance term, and End-User shall receive no less
than 30 (thirty) days written notice prior to such change.
Exhibit E