SOFTWARE SERVICE AGREEMENT
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The following document constitutes a Software Service Agreement between:
SUMMIT V, INC., a subsidiary of Jenkon International, Inc., a corporation
organized and existing under the laws of the State of Washington, United
States of America, located at 7600 NE 41ST STREET, SUITE 350, VANCOUVER,
WASHINGTON, 98662, hereinafter referred to as Seller, and
a corporation organized and existing under the laws of the State of Georgia,
United States of America, located hereinafter referred to as LICENSEE.
1. BASIS OF AGREEMENT:
Buyer has engaged Seller to provide certain software services as
described further below with respect to the Summit V Jenkon Software
Base System and related modules (hereinafter referred to as the
"Software") which are the subject of a Software License Agreement
dated as of _____________ between Seller and Buyer.
2. PRICE AND PAYMENT:
2.1 PRICE:
Buyer shall pay annually to Seller for Covered Service as defined, the
sum of ________ in U.S. Funds. ANNUAL THIRD PARTY SOFTWARE SUPPORT
EQUALS THE SUM OF ________ IN U.S. FUNDS.
2.2 PAYMENT SCHEDULE:
Seller will invoice Buyer in advance for each period of Covered
Service. Payments are required to be received by Seller PRIOR to the
start of the period to insure continued service.
PAYMENT SCHEDULE: PAYMENT OF TO BE INVOICED MONTHLY (SEE
SALES ORDERS # ) THIRD PARTY SOFTWARE SUPPORT PAYMENT
SCHEDULE; PAYMENT OF TO BE INVOICED MONTHLY. (SEE SALES ORDER
# )
2.3 EFFECTIVE DATE
The effective date of this Agreement shall be the Date of Acceptance
as determined in Paragraph 4.12.1 of the Software License Agreement.
2.4 TAXES:
All service charges are exclusive of applicable federal, state or
local taxes. Buyer shall pay or reimburse Seller for any such taxes to
the invoices submitted to Buyer by Seller.
2.5 CHANGES IN SERVICE RATE:
Seller may change the service charges for Covered Service anytime with
thirty (30) days prior written notice to the Buyer. Buyer has the
right to cancel this Agreement within thirty (30) days of receiving
such notice with a written cancellation notice. Seller may not
increase the service charges more often than annually. The service
charges for the first twelve months of this
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Agreement will be fixed at price not to exceed 15% of the total
license fees for the Licensed Software. In no event shall the service
charges to licensee exceed the preceding year's service charges by
more than 15 percent. When additional Licenses and or Modules are
purchased standard service charges will be calculated as of the date
of purchase.
3. COVERED SERVICE:
3.1 COVERED SERVICE:
The term "Covered Service" as used herein means the periodic service
Seller deems reasonable, appropriate and necessary to keep Buyer's
Software performing as documented in the documentation manuals
provided by Seller to Buyer. Covered Service shall be provided during
Seller's normal business hours on all weekdays, Monday through
Friday. Buyer shall have access to Emergency Hotline Support outside
of normal business hours and during holidays. Seller shall provide to
Buyer under the terms of this Agreement, the following:
3.1.1 Continuing warranty that the licensed programs will perform in
conformity with the written manuals for the version of
Licensed Software in use.
3.1.2 Free telephone support service during Seller's normal business
hours.
3.1.3 Free access to 24 hour Emergency Hotline Support Services.
3.1.4 New enhancements and upgrades to Licensed Software. Major
enhancements that are priced separately to other Buyers who
purchase similar Software from Seller will be made available
to Buyer at costs charged by Seller to such other customers.
Where Buyer has implemented special changes to existing
programs, the new enhancements may required special
installation work to incorporate the Buyer's special changes.
In such cases, Seller will install the enhancements at buyers
request with special changes incorporated, and charge the fees
based on Seller's current rates.
3.1.5 New versions of computer equipment operating system tapes as
they are made available to Seller from the equipment vendors.
Seller will provide installation instructions for each tape.
3.1.6 Manufacturer/vendor technical notes as they are made available
to Seller. These notes often describe operating system
problems and solutions that the vendor has discovered and other
information of a technical nature that may assist Buyer to
keep the computer equipment operational and operating system
Software at the most current version releases and
functionality.
3.1.7 Seller will, from time to time, advise Buyer of new devices,
software programs, or other information that will aid Buyer
in the ongoing utilization of the computer system.
3.1.8 Patches and fixes to the Software as they are made generally
available by Seller.
3.1.9 Free Software program updates to generate 1099 and T4A forms
for U.S. and Canadian tax reporting.
3.1.10 Repair or correction of Software programming due to special
changes made by Seller at Buyer's request.
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3.1.11 Correction of Buyer data caused by Licensed Software program
error.
3.1.12 Seller shall respond to a call from Buyer for covered services
by the end of the next business day.
3.2 EXCLUSIONS FROM COVERED SERVICES
Covered Service does not include the following:
3.2.1 Those items listed under 3.3, "Billable Service Call".
3.2.2 Correction of Buyer data caused by Buyer's error, or equipment
failure.
3.2.3 Work on Software not sold and licensed to Buyer by the Seller.
3.2.4 Buyer shall advise Seller in writing of any modifications made
to the Software. Seller shall not be responsible for maintaining
Buyer modified portions of the Software. Corrections or defects
traceable to Buyer's errors or system changes will be billed
at Seller's standard time and materials rate.
3.3 BILLABLE SERVICE CALL
Billable service call will be any service, other than Covered Service,
performed by Seller and includes, but is not limited to, the following
types of service:
3.3.1. Work requested by the Buyer for the creation of new software
programs, or the enhancement or customizing, of existing
Software programs.
3.3.2. Training, consulting, or advising Buyer on matters not covered
under Covered Service.
3.3.3 Correcting or changing data at the request of Buyer.
3.3.4 Work requested by Buyer to install new enhancements to
previously changed or customized programs where the new
version of the programs does not contain the special change or
customized feature previously installed for Buyer.
3.3.5 Work required to correct the Operating System or Licensed
Software which has been modified by the Buyer or a third party.
3.3.6 Work required to correct problems which would not have
occurred if the current release of the Software, which had
been offered to the Buyer, was being used by Buyer but the
Buyer elected not to load it on the system.
3.3.7 Revisions to the operating system and the application Software
that are made available to the Seller by the Manufacturer for
a fee, are excluded from being provided at no charge and will
be made available to Buyer for a fee.
3.4 BILLABLE SERVICE TERMS AND RATES
Billable service will be charged to the Buyer according to the
Seller's billable rates in force at the time the service is carried
out. All charges for billable service shall be paid by Buyer within
the terms set in the sales order for any work sold on a sales order,
otherwise within the due date on the invoice. Failure the comply with
this shall cause a default of this Agreement. Interest will be
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charged on the past due balances at an annualized rate of 18% (1.5%
per month) or the maximum allowed by law, whichever is less.
Billable service calls, as defined herein, performed at Buyer's
location will be charged at a minimum rate of $150.00 per hour. Each
additional hour beyond the first eight will be charged at the Seller's
current billable rates, plus transportation, lodging, and other
related business expenses.
3.5 TAXES
All service charges are exclusive of applicable federal, state or
local taxes. Buyer shall pay or reimburse Seller for any such taxes to
the invoices submitted to Buyer by Seller.
4. TERMS AND TERMINATION:
This Agreement shall become effective on the Effective Date of this
Agreement, and unless sooner terminated as hereinafter provided, shall
remain in full force and effect for an initial term of one (1) year
from such date, and then automatically renewed each subsequent year
unless otherwise terminated by either party by written notice
delivered at least 30 days in advance. Automatic renewal shall not
occur if Buyer is in default of a material term of the Agreement.
Either Buyer or Seller, after the initial term, may terminate this
Software Service Agreement at any time upon thirty (30) days written
notice.
Seller shall have the right at its option to immediately terminate
this Agreement by written notice to Buyer in the event of:
4.1 An assignment for the benefit of creditors, or
4.2 Admitted insolvency, or
4.3 Dissolution or loss of charter by forfeiture, or
4.4 Being adjudged bankrupt or insolvent by a United States Court
of competent jurisdication, or
4.5 A trustee or receiver being appointed for all assets or any
substantial proportion thereof, or
4.6 Filing a voluntary petition under any bankruptcy or other
similar law providing for reorganization, dissolution, or
liquidation, or
4.7 Consenting to the appointment of a receiver or a trustee for
all assets of any substantial part thereof.
5. LIMITATION OF LIABILITY:
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5.1 LIMITATIONS
In all situations involving performance or nonperformance of the
Licensed Software furnished hereunder, Seller's entire liability and
the Buyer's exclusive remedy shall be as follows:
5.1.1 The correction by Seller of Licensed software defects, and the
correction or restoration of any Buyer's data that was damaged
or corrupted by any Licensed software defect, or
5.1.2 If, after reasonable efforts, Seller is unable to make the
unmodified Licensed Software operate as documented, Buyer
shall be entitled to recover actual damages to the limits as
set forth in this section. For any other claim concerning
performance or nonperformance of Licensed Software pursuant to
or in any other way related to the subject matter of this
Agreement and any supplement hereto, the Buyer shall be
entitled to recover actual damages to the limits set forth in
this section.
5.1.3 Seller's liability for damages to the Buyer for any cause
whatsoever, and regardless of the form of action, whether in
contract or in tort, including negligence, shall be limited to
the total amounts paid to Seller under the Software License
Agreement. In no event will Seller be liable for damages caused
by the Buyer's failure to perform the Buyer's responsibilities.
5.1.4 In as much as Buyer shall prepare commission checks from time
to time, Buyer shall accept full responsibility to audit and
verify all commission calculation amounts before sending any
commission check to any person. In the event an error is found,
whether before or after any commission check is sent to any
person, Seller's exclusive liability shall be to correct the
software programs in a timely fashion. If Buyer sends incorrect
commission checks to any person, Seller shall not be liable for
loss of profits or damages of any kind resulting from the
incorrect calculations of commission amounts.
5.1.5 No action regardless of form, arising out of a claim of a
breach of this Agreement may be brought by either party more
than two (2) years after the date of the alleged breach,
except that an action for nonpayment will be limited only by
the statute of limitations of the State of Washington.
6. GENERAL:
6.1 DEFAULT
It is a default under this Agreement if any one or more of the
following events occur and Seller is adversely affected:
6.1.1 Buyer breaches any one or more of the covenants, terms or
conditions of this Agreement to be paid, performed, or complied
with by Buyer; or
6.1.2 Buyer becomes bankrupt or insolvent
6.2 NOTICES
All notices required hereunder shall be given in writing and shall be
personally delivered or sent by postage prepaid mail addressed to the
parties at their addresses first mentioned, or at such other addresses
as either party may designate to the other by notice as provided in
this section. Notices
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shall be deemed effective upon their deposit into the U.S. Mail,
properly addressed and postage prepaid.
6.3 INVALID PROVISIONS
If any provision of this Agreement be invalid or unenforceable, then
the remainder of this Agreement shall not be affected thereby.
6.4 ENTIRE AGREEMENT
This Agreement supersedes all prior agreements, letters of intent,
negotiations, representations and proposals, written or oral, requests
for proposals, or previous discussions of the parties. There have been
no other promises or inducements, oral or written, given by any party
to the other to enter into this Agreement. The parties agree that this
Agreement or any term or provision thereof shall not be modified in any
manner whatsoever without the written authorization of both parties
hereto and signed by both an authorized representative of Buyer and by
an authorized representative of Seller. To the extent of any conflict
or inconsistency, the Software License Agreement shall supersede and
prevail over any term of this Software Service Agreement as to the
matters addressed herein.
6.5 ARBITRATION
If any controversy or dispute arises out of this Agreement, or the
breach thereof, the parties will endeavor to settle such dispute
amicably. If the parties shall fail to settle any dispute, such
dispute shall be finally settled by binding arbitration conducted in
Clark County, Washington. All arbitration shall be in accordance with
the then existing Commercial Arbitration rules of the American
Arbitration Association, and judgment upon the award rendered by the
arbitrators may be entered in any court having jurisdiction thereof;
provided that nothing in this section shall prevent a party from
applying to a court of competent jurisdiction to obtain temporary
relief pending resolution of the dispute through arbitration. The
parties hereby agree that service of any notices in the course of such
arbitration at their respective addresses as provided for in this
Agreement shall be valid and sufficient. If either party seeks
to enforce its rights under this Agreement, the non-prevailing party
shall pay all costs and expenses incurred by the prevailing party.
6.6 ATTORNEY FEES
The prevailing party in any arbitration or lawsuit concerning this
Agreement or any matter related thereto shall be entitled to any award
of reasonable attorney fees and costs from the other, including fees
incurred through trial, appeal or in bankrupt proceedings. Attorney
fees awarded pursuant to this paragraph shall not be included within
the definitions of "Damages" or otherwise limited by paragraph 5.1.1.
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7. AUTHORIZED SIGNATURE:
This Agreement shall be binding upon Buyer and Seller only at such
time as it has been signed by an Authorized Officer of the Buyer and
by an Officer, identified below, of Seller.
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ACCEPTED BY: SUMMIT V, INC.
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NAME:
(PLEASE PRINT)
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NAME:
(SIGNATURE)
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TITLE:
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DATE:
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