CANDLE CORPORATION
SOFTWARE AGENCY AGREEMENT
This SOFTWARE AGENCY AGREEMENT ("AGREEMENT") is entered on October 7, 1996
("EFFECTIVE DATE") by CANDLE Corporation with offices at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.,
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ("CANDLE") and ▇▇▇▇▇ ▇ Systems Inc. ("AGENT"), with its
principal place of business at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ and refers to the following facts:
RECITALS
1. CANDLE licenses, markets, distributes, and maintains certain software
products;
2. Agent markets software products and wishes to acquire from CANDLE the right
to solicit Candle's Products in the Territory;
NOW, THEREFORE, the parties agree as follows:
1. DEFINITIONS
a. "END-USER" means the entity or person, resident in the Territory,
sublicensing CANDLE's products from CANDLE for its internal use,
pursuant to an End-User License without any right to sublicense.
b. "END-USER LICENSES" "Licenses" mean License and Trial License
Agreements, and any other contracts or agreements entered into with
End-Users regarding the licensing and support of the Products.
c. "PRODUCT(S)" means the object code version of one or more of the
computer programs listed in Schedule A, attached to this Agreement,
which CANDLE may amend from time to time, and any technical
Documentation relating to such programs.
d. "TERRITORY" means North America.
e. "SITE" means a single location of Licensee composed of a single
building or a building complex.
2. APPOINTMENT AND GRANT OF LIMITED MARKETING RIGHTS
a. LICENSE GRANT. CANDLE grants to Agent the following licenses:
i. a non-exclusive, limited right to market and solicit Products to
End-Users located in the Territory;
ii. a limited, non-transferable, non-exclusive right to use the
Products for demonstration purposes. Agent shall have no access to the
source code for the Products.
b. DISTRIBUTION OUTSIDE TERRITORY. Promotion, solicitation or marketing
the Products outside the Territory requires CANDLE's prior express
written consent which Candle may withhold in its discretion.
c. LEGAL ACTION. Agent agrees that CANDLE may bring any legal or
equitable actions, either in its own or Agent's name for: i) breach by
any End-User Licenses, or (ii) infringement of any proprietary and
intellectual property rights of CANDLE.
d. SCOPE OF LICENSE. Agent shall not distribute or enter into
sublicenses regarding the Products with any third parties without
CANDLE's prior written consent which CANDLE may withhold in its
discretion.
e. OTHER RESERVED RIGHTS. CANDLE reserves all rights not specifically
granted to Agent, including, without limitation, the right to create
enhancements and derivative works, and the rights to all its
intellectual property rights. CANDLE may keep all revenue generated
as a result of such activities, and such revenue will not be subject
to this Agreement.
3. MARKETING OBLIGATIONS OF AGENT
a. PROMOTION EFFORTS. Agent will use its reasonable efforts to solicit
promote and market the Products to End-Users in the Territory by providing
seminars, education, trade shows and similar promotional activities in the
Territory. If Agent prepares any marketing materials on the Products, it
shall submit such materials to CANDLE for its prior written approval.
b. PERSONNEL AND SHARED ASSISTANCE. Within three (3) months following the
execution of this Agreement, and for the duration of this Agreement, Agent
will train and maintain at least one capable person in sales and one in
support: (i) to serve the demands and needs of End-Users in the Territory,
to demonstrate the Products; and (ii) otherwise to carry out the
obligations and responsibilities of Agent set forth in this Agreement.
c. REMOVAL OF TRADEMARKS. Agent agrees not to remove any notices, legends
or marks appearing on or in the packaged materials including the first
screen of the Products and the documented and external packaging materials.
Agent shall reproduce such trademarks and trade names on documents as
necessary to market, advertise, and solicit the Products. Agent may not
market the Products under any other or different names than those specified
by CANDLE. Agent agrees to assist CANDLE in taking any reasonable steps at
CANDLE's cost that may be necessary to protect CANDLE's rights in the trade
names and trademarks of the Products. Agent shall not register or use any
of CANDLE's trademarks or trade names or any word, symbol, or design
confusingly similar thereto, as part of its corporate name.
d. COMPLIANCE WITH LAW. Agent shall be subject to all applicable laws in
performing all its duties under this Agreement. At its own expense, Agent
shall take such necessary action as may be necessary to enable Agent to
obtain and keep current all government licenses, permits and approvals,
necessary or advisable for the promotion, and marketing of the Products in
the Territory.
e. CONFLICTS OF INTEREST. During the term of this Agreement and for
a period of two (2) years after the termination of this Agreement, neither
Agent nor any parent or subsidiary of Agent, shall enter into any agency
agreement to market, promote, license, sell or otherwise make available
during the term of this Agreement, either directly or indirectly, or
through an entity which is in any way financially or contractually related
to Agent, any products which in CANDLE's reasonable opinion substitute for,
are competitive with, or perform functions substantially similar to those
performed by the Products. Candle may immediately terminate this Agreement
if Agent breaches this Section. After the expiration of this, the companies
will renegotiate this term in good faith.
4. MARKETING OBLIGATIONS OF CANDLE
CANDLE represents and warrants as follows:
PRODUCTS. CANDLE will supply Agent at its cost with one copy of the
Products for demonstration purposes and such other materials or
information, including marketing brochures to assist Agent in promoting and
soliciting the Products in the Territory.
5. TERM AND TERMINATION
a. TERM. The term of this Agreement shall commence on ____________ the
Effective Date for a period of one year and shall automatically renew for
one year periods unless either party provides the the other party with one
hundred twenty (120) days prior written notice. Notwithstanding any other
provision, the Agreement may be terminated before the expiration of its
stated term as set forth below.
b. CANDLE TERMINATION FOR CAUSE. CANDLE may promptly terminate this
Agreement at any time before the expiration of its stated term, or
thereafter, in the event that Agent breaches CANDLE proprietary or other
intellectual property rights or makes material misrepresentations to third
parties regarding the Products.
c. TERMINATION FOR CAUSE. Either party may terminate this Agreement at
any time prior to the expiration of its stated term, or thereafter, in the
event that:
(i) The other party fails to perform any material obligation,
warranty, or defaults on any obligation under this Agreement and such
failure or default continues unremedied for period of thirty (30)
days; or
(ii) Agent is merged, consolidated, sells all or a majority of its
assets, or implements or suffers any substantial change in management
or control effecting a majority of its shares.
d. AUTOMATIC TERMINATION. This Agreement terminates automatically, with
no further action by either party, if a receiver is appointed for either
party or its property, either party makes an assignment for the benefit of
its creditors, any proceedings are commenced by, for or against either
party under any bankruptcy, insolvency or debtor's relief law or either
party is liquidated or dissolved. This Agreement shall also terminate
automatically if Agent ceases usual business operations.
e. NO CONSEQUENTIAL DAMAGES FOR TERMINATION. Under no circumstances will
CANDLE be liable to Agent for damages of any kind, including incidental or
consequential damages, for terminating this Agreement even if advised of
the possibility of such damages.
f. REMEDIES NOT EXCLUSIVE. Except as specifically provided to the
contrary herein, the right of either party to terminate this Agreement is
not an exclusive remedy and either party shall be entitled alternatively or
cumulatively to any and all other remedies available to it.
g. GOODWILL. Agent agrees that any goodwill/or market share created by
the Products or Agent's efforts pursuant to this Agreement will not
generate any separate or additional compensation, clientele indemnity,
termination damages, or special damages of any other kind from CANDLE to
Agent and that any such goodwill belongs to CANDLE. Agent shall invest as
required in its discretion to market and support the Products during the
term of this Agreement, including without limitation building up the
market, and further agrees that Agent's sole return and reimbursement for
this shall be from Agent's share of payments set forth herein and from no
other source. On termination, Agent shall not make any claim, demand, or
request for any additional remuneration whatsoever and shall hold harmless
and indemnify CANDLE against any such claim, demand or request.
6. TERMINATION PROCEDURE
a. EFFECT OF TERMINATION. Upon termination of this Agreement for
whatever reason:
(i) Agent shall no longer solicit or market the Products to End-Users
in the Territory. CANDLE shall no longer compensate Agent for such
activities.
(ii) Agent shall deliver to CANDLE, at no cost to CANDLE, within
thirty (30) days after termination hereof, any existing Candle
customer list, tapes, documentation, inventory, demonstration copies
and materials of whatever kind or nature regarding the Products, in
Agent's possession or control.
(iii) The parties shall use their best efforts to carry out an
orderly termination of their relations and to provide a smooth
transition, from Agent to CANDLE or CANDLE's designated
representative.
(iv) Each End-User may continue to use the Products licensed under
valid End User Licenses, it being understood that the End-Users'
rights set forth are independent of this Agreement and will survive
termination of this Agreement.
(v) Agent will cease to use any CANDLE trademarks or trade names, and
will promptly return to CANDLE all advertising, promotional, and
similar materials and cancel all advertising and promotion of the
Products.
(vi) For a period of six (6) months after the date of termination,
Agent shall make available to CANDLE for inspection and copying all
books and records of Agent regarding Agent's performance of and
compliance with its obligations, warranties, and representations under
this Agreement.
(vii) Any provision of this Agreement which is by its terms
applicable to periods or actions occurring after expiration or
termination of the Agreement including, without limitation all
provisions regarding solicitation, advertising, proprietary and
intellectual property rights, compensation, warranties and
representations shall survive this Agreement. CANDLE agrees to pay to
Agent any fees regarding Agent's solicitation activities during the
term of this Agreement after the expiration or termination of this
Agreement.
7. LICENSE PROCEDURE
a. END-USER LICENSES. Only CANDLE may enter into license agreements with
End-Users. Once an End-User has agreed to license the CANDLE Products,
Agent shall pass the End-User's name, address and number of Products to
CANDLE so CANDLE can send licenses to the End-User. This Agreement does not
require the Agent to provide technical support, any maintenance and other
similar services required after Licenses with End-Users have been entered
into.
b. DISTRIBUTION OF PRODUCTS. Agent shall notify CANDLE of the name,
address and Products of each End-User who requires Product tapes to be
shipped. Upon receipt of each confirmed order pursuant to an End-User
License, CANDLE will ship the Products to End-User(s) business place
directly. Agent shall not maintain an inventory of the Products tapes at
any of its business places, except copies for demonstration purposes only.
c. DISCONTINUANCE OF PRODUCTS. CANDLE may discontinue to publish,
distribute or license any Products or features at any time, without notice,
and may cancel any orders for such discontinued Products without any
liability to Agent or any other third parties. No such cancellation,
refusal or delay will be deemed a termination (unless CANDLE so advises
Agent) or breach of this Agreement by CANDLE. Notwithstanding the above,
CANDLE will use its best efforts to provide Agent with 90 days prior notice
before taking such actions.
d. CHANNEL CONFLICT. In the event the parties to this Agreement have a
dispute regarding who solicited an End-User for the CANDLE Products, the
parties agree to work out in good faith a reasonable solution to this
conflict. In the event Agent has a dispute with another Candle distributor,
agent or reseller regarding a solicitation of CANDLE Products to an
End-User account, CANDLE shall in good faith arbitrate this dispute.
CANDLE's decision in this dispute shall be final.
8. COMPENSATION, SHIPMENT AND ADMINISTRATION
a. COMPENSATION. CANDLE shall pay to Agent a 15% compensation of the net
revenue (calculated without taking into account any taxes, including
without limitation, any value-added, sales, use, excise, property or other
tax, imposed by any governmental authority arising out of the transactions
under this Agreement which Candle or the End User may have to pay or
collect) received by Candle from the End User for each Product sold.
b. FOLLOW UP SALES. For a period of six (6) months following the
initial sale to an End-User at a particular Site, the obligation set forth
in Section 8.a. shall also apply regarding any follow up sales of the
Products to the same Site. An extension of such six (6) months period
shall be negotiated in good faith by the parties to take into account
transactions, such as pilot or trial sales, extending for longer periods.
c. QUARTERLY REPORTS. Within three (3) business days after the end of
each calendar quarter during the term of this Agreement and for forty-five
(45) days thereafter, Agent shall provide CANDLE, by facsimile, a prospect
registration form to be agreed on by the parties, for each End-User
License that is expected to be granted during the next quarter, and such
other forms and information as CANDLE may request from time to time to
determine the source of the compensation and other amounts due hereunder.
d. NOTIFICATION. Each party will notify the other in writing of (i) any
claim or proceeding involving the Products within the Territory no later
than ten (10) days after the party learns of such claim or proceeding; (ii)
all claimed and suspected product defects; and (iii) any change in its
management or control or any transfer of more than twenty-five percent
(25%) of its assets or voting power within thirty (30) days thereof.
9. LIMITATION OF WARRANTIES AND INDEMNIFICATION OF AGENT
a. WARRANTY POLICY. CANDLE makes no warranties or representations as to
the performance of the Products or as to services to Agent, to End-User, or
to any other person. CANDLE reserves the right to change its warranty and
service policy set forth in such End-User Licenses or otherwise, at any
time, without further notice and without liability to Agent or any other
person.
b. DISCLAIMER OF WARRANTIES. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
ALL IMPLIED WARRANTIES, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, ARE HEREBY
DISCLAIMED.
c. NO CONSEQUENTIAL DAMAGES. IN NO EVENT SHALL CANDLE BE LIABLE FOR
INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, EVEN IF CANDLE HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
d. LIMITED LIABILITY. THE LIABILITY OF CANDLE, IF ANY, FOR DAMAGES
RELATING TO ANY OF THE PRODUCTS SHALL BE LIMITED TO THE ACTUAL LICENSE FEE
RECEIVED BY CANDLE FOR SUCH PRODUCT.
10. INDEMNIFICATION
Each party will defend and indemnify the other party (including reasonable
attorney's fees and costs of litigation) against and hold the other party
harmless from, any claims by any third party resulting from either party's
misrepresentations, regarding the Products.
CANDLE agrees to defend or, at its option, settle any action or claim
based upon a third party's claim of patent, copyright trade name or trade
secret infringement asserted against Agent because of its use of the
Products as delivered by CANDLE, provided that CANDLE is given prompt
notice of the action or claim and the right to control and direct the
investigation, defense and settlement thereof, and further provided that
Agent shall reasonably cooperate with CANDLE in connection with the
foregoing.
11. INTELLECTUAL PROPERTY RIGHTS AND CONFIDENTIALITY
a. INTELLECTUAL PROPERTY RIGHTS. Agent acknowledges CANDLE's exclusive
right, title and interest in and to any patents, copyright, trademarks,
trade names and similar rights which CANDLE may at any time own, adopt, use
or register in the Territory (jointly referred to as the "INTELLECTUAL
PROPERTY RIGHTS") and will not at any time do or cause to be done any act
or thing contradicting or in any way impairing or tending to impair any
part of said right, title and interest. Agent specifically acknowledges
that its appointment as agent and its representation of any Products
identified by any Intellectual Property Rights shall not create in Agent
any right, title, or interest in such rights.
b. CONFIDENTIAL INFORMATION. During the terms of this Agreement, CANDLE
may disclose to Agent certain proprietary information, including but not
limited to technical information, business and financial data and other
trade secrets relating to CANDLE's business ("CONFIDENTIAL INFORMATION").
Agent agrees that this
Confidential Information constitutes valuable business assets of CANDLE,
the disclosure of which to third parties may cause irreparable damage.
Agent agrees not to disclose the Confidential Information to any parties
without CANDLE's prior written consent. This obligation shall survive the
termination of this Agreement.
Agent agrees that it will only use the Intellectual Property Rights and
Confidential Information to market and maintain the Products, and that,
upon expiration or termination of this Agreement, it will discontinue all
use of the Intellectual Property Rights and Confidential Information
without demand or judicial resolution.
Agent shall promptly notify CANDLE of any infringements, imitations,
illegal use, or misuse of the Intellectual Property Rights and
Confidential Information which come to Agent's attention. Agent agrees to
take any action requested by CANDLE, at CANDLE's reasonable expense, in any
court administrative agencies or otherwise, to prevent the infringement,
imitation or illegal use or misuse of any Intellectual Property Rights and
Confidential Information. Agent agrees to assist CANDLE in protecting
CANDLE's Intellectual Property Rights and Confidential Information in the
Territory and to make promptly available to CANDLE and its attorneys all of
Agent's files, records and other information pertaining to the advertising,
promotion and solicitation of the Products.
12. EXPORT CONTROLS
Agent acknowledges the Products originate in the United States and Agent
agrees to comply with any applicable U.S. laws, regulations, rulings and
executive orders on exportation (including, without limitation, the export
and destination control regulations of the United States Commerce and State
Departments and the anti-boycott regulations of the United States Commerce
and Treasury Departments) and with all applicable laws on import or export
of the Products. Agent warrants and represents that it will not export or
re-export outside the Territory any of the Products, whether directly or
indirectly.
Agent agrees to indemnify CANDLE against any claim, demand, action,
proceeding, investigation, loss, liability, or damage expense suffered or
incurred by CANDLE and arising out of or related to any violation (whether
intentional or unintentional) by Agent of any of the warranties or
covenants in this paragraph and to cooperate with CANDLE at no charge to
CANDLE in responding to and, defending any such claim.
13 GENERAL PROVISIONS
a. MODIFICATIONS AND AMENDMENTS. This Agreement shall not be modified,
amended, canceled or in any way altered, nor may it be modified by custom
and usage of trade or course of dealing, except by an instrument in writing
and signed by both of the parties hereto. All amendments or modifications
of this Agreement shall be binding only if in writing and executed by both
parties.
b. WAIVER. Performance of any obligation required of a party hereunder
may be waived only by a written waiver signed by the other party, which
waiver shall be effective only with respect to the specific obligation
described therein. The waiver by either party hereto of a breach of any
provision of this Agreement by the other shall not operate or be construed
as a waiver of any subsequent breach of the same provision or any other
provision of this Agreement.
c. SEVERABILITY. In the event that any provision is found invalid or
unenforceable pursuant to judicial decree or decision, the remainder of
this Agreement shall remain valid and enforceable according to its terms.
WITHOUT LIMITING THE FOREGOING, IT IS EXPRESSLY AGREED THAT EACH AND EVERY
PROVISION OF THIS AGREEMENT WHICH PROVIDES FOR A LIMITATION OF LIABILITY,
DISCLAIMER OF WARRANTIES OR EXCLUSION OF DAMAGES IS INTENDED BY THE PARTIES
TO BE SEVERABLE AND INDEPENDENT OF ANY OTHER PROVISION AND TO BE ENFORCED
AS SUCH. FURTHER, IT IS EXPRESSLY AGREED THAT IN THE EVENT ANY REMEDY IS
DETERMINED TO HAVE FAILED OF ITS ESSENTIAL PURPOSE, ALL OTHER REMEDIES AND
LIMITATIONS OF LIABILITY AND EXCLUSION OF DAMAGES SET FORTH HEREIN SHALL
REMAIN IN FULL FORCE AND EFFECT.
d. VALIDITY, FORUM, LAWS AND CONSTRUCTION. (a) Disputes or controversy
(except for those related to copyright and any other intellectual property
claims) between the parties hereto arising under this Agreement or in any
other agreement or document executed and delivered by the parties in
connection with the transactions contemplated hereby shall, upon written
demand of any party hereto, be submitted to and be resolved by binding
arbitration in the City of Los Angeles pursuant to the rules, regulations,
practices and procedures then prevailing of the American Arbitration
Association. Any award or decision rendered shall be made by means of a
written opinion explaining the arbitrator(s)' reasons for the award or
decision, and the award or decision shall be final and binding upon the
parties hereto. The arbitrator(s) may not amend or vary any provision of
this Agreement. Judgment on the award rendered by the arbitrator(s) may be
entered in any court having Jurisdiction.
(b)The legal relations between the parties shall be governed by the laws of
the State of California, regardless of the choice of law provisions of
California or any other jurisdiction. Litigation or arbitration of
disputes under this Agreement shall be conducted in Los Angeles,
California. The parties further agree not to disturb such choice of forum,
hereby waive the personal service of any and all process upon them, and
consent that such service of process may be made by certified or registered
mail, return-receipt requested, addressed to the parties as set forth in
this Agreement.
e. BREACH. Neither party shall be in breach of any of its obligations
hereunder unless and until it shall have been given written notice of such
specifying the nature of such breach and the breaching party shall have
failed to cure such breach within the periods provided for herein, except
in the case of an alleged breach involving misuse of proprietary
information the notice period shall be five (5) business days.
f. ASSIGNMENT. Agent may not assign this Agreement or any of its rights
or obligations hereunder (including without limitation rights and duties of
performance) to any third party or entity, and this Agreement may not be
assigned involuntary or by operation of law, without the CANDLE's prior
written consent.
g. BENEFIT OF SUCCESSORS AND ASSIGNS. All rights and obligations of this
Agreement shall inure to the benefit of the parties and their respective
successors in title and assigns notwithstanding any change in the
constitution or amalgamation or reconstruction of the parties or their
respective successors or assigns.
h. NO PARTNERSHIP OR AGENCY. Nothing in this Agreement shall be
construed as creating a joint venture, partnership, agency, employment
relationship or franchise relationship, nor shall either party have the
right, power or authority to create any obligations or duty, express or
implied, on behalf of the other party hereto, it being understood that the
parties are independent contractors vis-a-vis one another.
i. NO THIRD PARTY BENEFICIARIES. Nothing contained in this Agreement,
express or implied, shall be deemed to confer any rights or remedies upon,
nor obligate any of the parties hereto, to any person or entity other than
such parties, unless so stated to the contrary.
j. EXCUSED PERFORMANCES. Neither party shall be in default of or to
have breached any provision of this Agreement as a result of any delay,
failure in performance or interruption of the Services, resulting directly
or indirectly from Acts of God, acts of civil or military authority, civil
disturbances, fire, transportation contingencies, shortages of facilities,
fuel, energy, labor or materials, or laws, regulations, acts or order of
any government agency or official thereof, other catastrophes, or any other
circumstances beyond its reasonable control.
k. NOTICES. All notices and demands hereunder shall be in writing and
shall be served by personal service telex or by mail at the following
addresses:
FOR CANDLE: CANDLE CORPORATION
General Counsel
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▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
FOR AGENT: ▇▇▇▇▇ ▇▇▇▇▇
_______________________________
_______________________________
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l. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
m. AUTHORITY TO EXECUTE. Each party to this Agreement represents and
warrants that it has full power to enter into this Agreement.
n. CAPTIONS. The section headings and captions contained herein are for
reference purposes and convenience only and shall not in any way affect the
meaning or interpretation of this Agreement.
o. ENTIRE AGREEMENT. This Agreement constitutes the entire understanding
and contact between the parties and supersedes any and all prior and
contemporaneous, oral or written representations, communications,
understandings and agreements between the parties with respect to the
subject matter hereof, all of which representations, communications,
understandings and agreements are hereby canceled to the extent they are
not specifically merged herein. The parties acknowledge and agree that
neither of the parties is entering into this Agreement on the basis of any
representations or promises not expressly contained herein.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
specified below.
For and on behalf of: Level Systems Inc. For and on behalf of: CANDLE CORPORATION
Signature: Signature:
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Printed Name: Printed Name:
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Title: Title:
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Date: Date:
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EXHIBIT A
LIST OF CANDLE PRODUCTS
Candle Command Center for MQ
MQ Secure