EXHIBIT 10.4
3/18/97
NETOBJECTS LICENSE AGREEMENT
AGREEMENT NUMBER: L97063
This NetObjects License Agreement ("Agreement") dated as of March 18, 1997
between NetObjects Corporation ("NETOBJECTS") with an address at ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and International Business Machines
Corporation ("IBM") with an address at ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇. Under
this Agreement, IBM licenses computer software from NETOBJECTS.
By signing below, the parties agree to the terms of this Agreement. The
complete Agreement between the parties regarding this transaction consists of
this Agreement and the following Exhibits:
I. Description of Licensed Work, EXHIBIT A.
II. Pricing, EXHIBIT B.
III. Source Escrow Agreement, EXHIBIT C.
IV. Product Improvements, EXHIBIT D.
V. NETOBJECTS Trademarks and Product Names, EXHIBIT E.
VII. Maintenance and Support, EXHIBIT F.
The following are related agreements between the parties:
VII. Agreement for Exchange of Confidential Information between IBM and
NETOBJECTS dated April 29, 1996. ("AECI")
This Agreement replaces all prior oral or written communications between the
parties relating to the subject matter. Once signed, any reproduction of this
Agreement made by reliable means (for example, photocopy or facsimile) is
considered an original, unless prohibited by local law.
ACCEPTED AND AGREED TO: ACCEPTED AND AGREED TO:
INTERNATIONAL BUSINESS NETOBJECTS CORPORATION
MACHINES CORPORATION
By: /s/ ▇.▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
--------------------------- ------------------------------
Authorized Signature Authorized Signature
Name: ▇.▇. ▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇▇▇▇▇
--------------------------- ----------------------------
Title: Asst. General Counsel Title: CEO
--------------------------- ---------------------------
Date: 3/18/97 Date: 3/18/97
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1.0 DEFINITIONS
Capitalized terms in the Agreement and its exhibits and other attachments have
the following meanings.
1.1 BUNDLE is a work that integrates, embeds, bundles or incorporates the
Licensed Work into or with other software or hardware.
1.2 CODE is computer programming code, including both Object Code and Source
Code.
a. OBJECT CODE is Code substantially in binary form, and includes header
files of the type necessary for use or interoperation with other computer
programs. It is directly executable by a computer after processing or linking,
but without compilation or assembly. Object Code is all Code other than Source
Code.
b. SOURCE CODE is Code in a form which when printed out or displayed is
readable and understandable by a programmer of ordinary skills. It includes
related source code level system documentation, comments and procedural code.
Source Code does not include Object Code.
1.3 DELIVERABLE is any item that NETOBJECTS provides under this Agreement.
1.4 DERIVATIVE WORK is a work that is based on an underlying work and that
would be a copyright infringement if prepared without the authorization of the
copyright owner(s) of the underlying work. Derivative Works are subject to the
ownership rights and licenses of a party or of others in the underlying work.
1.5 DISTRIBUTORS are those authorized or licensed by IBM, IBM Subsidiaries or
IBM Distributors to license or distribute Products.
1.6 EFFECTIVE TIME shall have the meaning set forth in the Agreement and Plan
of Merger dated as of March 18, 1997, among IBM, Net Acquisition Corporation,
NETOBJECTS and the Holders (as set forth therein).
1.7 ENHANCEMENTS are changes or additions, including versions and releases,
other than Error Corrections, to the Licensed Work during the term of this
Agreement.
1.8 ERROR CORRECTIONS are revisions that correct errors and deficiencies
(collectively referred to as "Errors") in the Licensed Work created during the
term of this Agreement.
1.9 EXTERNALS are (1) any pictorial, graphic, and audiovisual works (such as
icons, screens, sounds, toolbars, palettes and characters) generated by
execution of Code, and (2) any programming interfaces, languages or protocols
implemented in Code to enable interaction with other computer programs or the
end user, including application program interfaces ("API"). Externals do not
include the Code that implements them.
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1.10 LICENSED WORK is (1) any material described in Exhibit A, Description of
Licensed Work, or that is delivered to IBM as the Licensed Work, including (but
not limited to) Code, associated documentation, and Externals, and (2) Error
Corrections and Enhancements.
1.11 MORAL RIGHTS are personal rights associated with authorship of a work
under applicable law. They include the rights to approve modifications and to
require authorship identification.
1.12 PRODUCT is an offering to customers or other users, whether or not branded
by IBM or its Subsidiaries, that includes the Licensed Work or a Derivative Work
of the Licensed Work.
1.13 SUBSIDIARY is an entity during the time that more than 50% of its voting
stock is owned or controlled, directly or indirectly, by another entity. If
there is no voting stock, a Subsidiary is an entity during the time that more
than 50% of its decision-making power is controlled, directly or indirectly, by
another entity.
1.14 TOOLS include devices, compilers, programming, documentation, media and
other items used by NETOBJECTS for the development, maintenance or
implementation of a Licensed Work or other Deliverable that are not commercially
available.
2.0 RESPONSIBILITIES OF NETOBJECTS
2.1 NETOBJECTS will provide the following to IBM on a reasonable schedule:
a. The Licensed Works in Object Code form, in accordance with Exhibit A; and
b. Early access to NETOBJECTS product plans and new product testing
and releases; and
c. Maintenance and support for the Licensed Work, as described in Exhibit F.
2.2 NETOBJECTS will:
a. implement a process designed to help prevent contamination by harmful
code. NETOBJECTS will provide IBM notice if NETOBJECTS suspects
contamination;
b. have written agreements with NETOBJECTS' personnel and third parties to
perform obligations and to grant or assign rights to IBM as required by
this Agreement, including all necessary consents of individuals or
entities required for the use of names, likenesses, voices, and the like
in the Licensed Work and agreements not to assert any Moral Rights from
any person or entity having Moral Rights in the Licensed Work. NETOBJECTS
agrees not to assert any Moral Rights in the Licensed Work. NETOBJECTS
further agrees to maintain records to verify authorship of the Licensed
Work for four (4) years after the termination or expiration of this
Agreement. On request, NETOBJECTS will deliver or otherwise make
available the foregoing records and information to IBM;
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c. not assign or transfer this Agreement or NETOBJECTS' rights under it, or
delegate or subcontract NETOBJECTS' obligations, without IBM's prior
written consent. Any attempt to do so is void.
d. work closely with IBM to develop a list of priorities, establish schedules
for implementation, and implement the product improvements described in
Exhibit D.
e. deposit Source Code of the Licensed Works and Tools (including all updates
and upgrades thereto) with an escrow agent selected jointly by IBM and
NETOBJECTS under the Escrow Agreement attached hereto as Exhibit C. IBM
will pay the fees of the escrow agent.
3.0 MUTUAL RESPONSIBILITIES
3.1 Each party agrees to:
a. not provide any information to the media, or issue any press releases or
other publicity, regarding this Agreement or the parties' relationship
under it, without the other party's prior written consent; and
b. not disclose to a third party the terms of this Agreement, without the
other party's prior written consent. Each party may, however, make such
disclosures (i) to its accountants, lawyers or other professional advisors
provided that any such advisor is under a confidentiality obligation and
(ii) as required by law provided the party obtains any confidentiality
treatment for it which is available. Also, NETOBJECTS may disclose the
terms of this Agreement to its shareholders of record as of the Effective
Time, subject to appropriate confidentiality obligations.
3.2 NETOBJECTS and IBM agree to participate in technical and business meetings
and discussions of plans for the Licensed Work, and to implement the product
improvement plan described in Exhibit D. Such meetings shall occur quarterly or
more often if requested by either party and will be held at a location to be
determined alternately by IBM and NETOBJECTS. Both parties shall bear their own
expenses associated with participating in these meetings. At each such meeting,
NETOBJECTS agrees to disclose its current road map or schedule for revisions,
enhancements, or other upgrades to the Licensed Work.
4.0 GRANT OF LICENSES
4.1 NETOBJECTS hereby grants IBM a nonexclusive, worldwide, irrevocable
license during the Term (as defined in Section 8.1) to use, execute, reproduce
and have reproduced, and to prepare and have prepared Bundles, in Object Code
form, and to display, perform, transfer, distribute, transmit and sublicense the
Licensed Works and Bundles, in Object Code form, in any medium or distribution
technology whatsoever, whether now known or hereafter invented. The rights and
licenses granted by NETOBJECTS to IBM under this Section 4.1 include the right
of IBM to authorize or sublicense its Subsidiaries, subcontractors, and
Distributors to exercise any of the rights granted to IBM hereunder.
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4.2 NETOBJECTS hereby grants IBM a nonexclusive, worldwide, irrevocable
license during the Term to use, execute, reproduce and have reproduced, and to
prepare and have prepared Derivative Works of the Licensed Works and Tools in
Source Code form for use in connection with the purposes and subject to the
Release Events set forth in Exhibit C, the Escrow Agreement. The rights and
licenses granted by NETOBJECTS to IBM under this Section 4.2 include the right
of IBM to authorize or sublicense its Subsidiaries and subcontractors to
exercise any of the rights granted to IBM hereunder.
4.3 NETOBJECTS hereby grants IBM a nonexclusive, worldwide, perpetual,
irrevocable, paid-up license during the Term to use the names and trademarks
used by NETOBJECTS to identify, or otherwise in connection with, the Licensed
Work, and Derivative Works, thereof, including but not limited to the names and
trademarks set forth in Exhibit E. NETOBJECTS grants IBM the right to
authorize or sublicense its Subsidiaries, Distributors and subcontractors to
exercise any of the rights granted to IBM hereunder. IBM will treat NETOBJECTS'
trademarks in the same manner as IBM treats its own trademarks. However, if
NETOBJECTS provides IBM with reasonable trademark guidelines, IBM will, for a
Product, comply with the version of such trademark guidelines that is current at
the time IBM announces the general availability of such Product.
4.4 Any goodwill attaching to IBM's trademarks, service marks, or trade names
belongs to IBM, and this Agreement does not grant NETOBJECTS any right to use
them. IBM may state that NETOBJECTS has provided the Licensed Work. Any
goodwill attaching to NETOBJECTS' trademarks, service marks, or trade names
belongs to NETOBJECTS and, subject to Section 4.3, this Agreement does not grant
IBM, its Subsidiaries, or Distributors, any right to use them.
5.0 PAYMENT
5.1 IBM will pay NETOBJECTS royalties as set forth in Exhibit B hereto.
5.2 IBM has no royalty obligation for:
a. copies of the Licensed Work or its Derivative Works made by IBM, its
Subsidiaries or subcontractors which are used for:
(1) IBM's and IBM Subsidiaries' (including third parties under contract)
Product development, maintenance or support activities;
(2) Product marketing demonstrations, customer testing or trial periods
(including early support, pre-release, or other similar programs),
Product training or education; or
(3) Product backup and archival purposes;
b. a copy of the Product used by a licensed end user at home or on travel
when such Product is stored on both the user's primary machine as well as
another machine, provided that the end user is not authorized to actively
use the Product on both machines at the same time;
c. the Licensed Work (or a functionally equivalent work) that becomes
available generally from NETOBJECTS to third parties without a payment
obligation;
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d. documentation provided with, contained in, or derived from the Licensed
Work;
e. Error Corrections or Enhancements;
f. warranty replacement copies of the Product;
g. Externals; or
h. use of an insignificant portion of the Licensed Work measured on the basis
of functionality.
5.3 IBM, IBM Subsidiaries, and Distributors may, without incurring any royalty
obligation, copy the Product and distribute it on a CD-ROM, or other media or
distribution technology now known or hereafter invented in a manner where the
customer, under a limited license, is allowed a limited preview, trial or
demonstration use of the Product. IBM will have no royalty obligation to
NETOBJECTS unless IBM, IBM Subsidiaries, or Distributors license the Product to
such customer for full unrestricted, productive use.
5.4 IBM may request a lower royalty for the Licensed Work when a licensing
transaction requires a substantial discount. If NETOBJECTS agrees, both parties
will sign a letter specifying the licensing transaction and its lower royalty
payment.
5.5 If NETOBJECTS offers another party lower rates, prices or royalties for
any Licensed Work, portions thereof, or Derivative Work thereof, than are
available to IBM under this Agreement, NETOBJECTS will promptly, in writing,
offer the same to IBM including other associated price related terms, if any.
If IBM accepts NETOBJECTS' offer, IBM will also accept the associated price
related licensing terms which may include volume commitments. NETOBJECTS will
maintain relevant records to evidence that IBM has been offered the most
favored customer pricing terms in accordance with the preceding paragraph.
These records will be made available by NETOBJECTS to an independent auditor
chosen and compensated by IBM. Such independent auditor shall sign a
confidentiality agreement.
5.6 For Hard Bundles and Soft Bundles, royalties are paid against revenue
recorded by IBM in a royalty payment quarter. In the U.S., a royalty payment
quarter ends on the last business day of the calendar quarter. Outside of the
U.S., a royalty payment quarter is defined according to IBM's then current
administrative practices. Upon request, IBM shall advise NETOBJECTS of all
applicable royalty payment quarters, and any changes thereto. Payment will be
made by the last day of the second calendar month following the royalty payment
quarter. Royalties will be paid less adjustments and refunds due to IBM in
accordance with this Agreement. IBM will provide a statement summarizing the
royalty calculation with each payment. All payments will be made in U.S.
dollars. Payments based on foreign revenue will be converted to U.S. dollars on
a monthly basis at the rate of exchange published by Reuters Financial Service
on approximately the same day each month.
5.7 IBM or any of its Subsidiaries will order a N.O. Package by issuing a
purchase order to NETOBJECTS against which NETOBJECTS will invoice IBM. IBM
will pay such invoices net thirty (30) days from the date of IBM's receipt of an
acceptable invoice. NETOBJECTS will deliver the N.O. Package (as defined in
Section 3.4 of Exhibit B) to IBM in accordance with the
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terms of the purchase order. The terms of this Agreement will govern in the
case of a conflict between this Agreement and any terms of a purchase order.
5.8 Each party will be solely responsible for any taxes incurred by the party,
directly or indirectly, associated with its performance of this Agreement.
5.9 The payments defined in this Section 5.0 and in Exhibit B hereto fully
compensate NETOBJECTS for its performance under, and for the rights and licenses
granted in, this Agreement.
5.10 IBM will maintain relevant records to support payments made to NETOBJECTS.
The records will be retained and made available for two (2) years from the date
of the related payment. If NETOBJECTS requests, IBM will make these records
available to an independent certified public accountant chosen and compensated
(other than on a contingency basis) by NETOBJECTS. NETOBJECTS' request will be
in writing, will provide IBM ninety (90) days prior notice, and will not occur
more than once each year. The audit will be conducted during normal business
hours at IBM's office and in such a manner as not to interfere with IBM's normal
business activities. The auditor will sign a confidentiality agreement and will
only disclose to NETOBJECTS any amounts overpaid or underpaid for the period
examined. In the event royalties are found by any audit to have been underpaid
by greater than ten percent (10%), IBM shall reimburse NETOBJECTS for the
reasonable charges of the auditor.
6.0 REPRESENTATIONS AND WARRANTIES
6.1 NETOBJECTS makes the following ongoing representations and warranties:
a. NETOBJECTS has full legal rights to grant the rights and licenses granted
herein;
b. NETOBJECTS is not under, and will not assume, any contractual obligation
that prevents NETOBJECTS from performing its obligations or conflicts with
the rights and licenses granted in this Agreement;
c. there are no liens, encumbrances or claims pending or threatened against
NETOBJECTS, or to NETOBJECTS' knowledge, anyone else, that relate to the
rights and licenses granted in this Agreement;
d. neither the Licensed Work nor the Tools contain libelous matters nor do
they directly or indirectly infringe any publicity, privacy or
intellectual property rights of a third party including, to NETOBJECTS'
knowledge, any patents or patent applications;
e. the Licensed Work will conform to NETOBJECTS' user documentation, and any
sales and marketing materials provided by NETOBJECTS;
f. the fully commented Source Code that NETOBJECTS provides corresponds to
the current release or version of the Licensed Work provided by NETOBJECTS
under this Agreement;
NETOBJECTS will immediately provide IBM written notice of any change that may
affect its representations and warranties.
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6.2 Except as provided above, anything either party provides to the other
related to this Agreement is "AS IS", without warranty of any kind.
7.0 INDEMNIFICATION AND LIABILITY
7.1 NETOBJECTS shall indemnify, defend and hold harmless IBM, IBM
Subsidiaries, and its and their end-users ("Indemnified Parties") and pay any
costs, expenses, attorneys' fees and damages finally awarded against or
settlements paid by any Indemnified Party, against any claim by a third party
that any Licensed Work infringes a copyright, trademark or patent or
misappropriates any trade secret of a third party or otherwise violates any
third party's intellectual property rights.
7.2 If any current release or unaltered version of any Product or component
part of a Licensed Work becomes the subject of any infringement action,
NETOBJECTS may at its option procure for IBM the right to continue promoting and
selling such Licensed Work, or replace or modify the Licensed Work.
7.3 NETOBJECTS will not be liable for any claim of infringement based on (i)
the use of Licensed Work in combination with any other products if such
infringement would have been avoided by the use of such Licensed Work without
such other products (unless such combination is consistent with the Licensed
Work intended use pursuant to the accompanying documentation or has been
specified by NETOBJECTS); (ii) IBM's use or distribution of such Licensed Work
without an Enhancement or Error Correction provided by NETOBJECTS that, if used,
would have made such Licensed Work non-infringing; or (iii) any use or
distribution of a Licensed Work in a manner not permitted under the licenses
granted under this Agreement or not in accordance with the documentation
provided by NETOBJECTS for such Licensed Work.
7.4 NETOBJECTS shall not be obligated to indemnify IBM under this Section
unless (i) IBM promptly notifies NETOBJECTS in writing of any claim to which the
indemnity obligations might apply; (ii) NETOBJECTS has the sole control of the
defense and/or settlement of such claim at NETOBJECTS' sole cost and expense;
and (iii) IBM reasonably cooperates with NETOBJECTS in defending or settling any
such claim. Subject to the foregoing conditions, IBM shall be entitled to
participate in the defense of any such claim at its expense.
7.5 IBM shall indemnify, defend and hold harmless NETOBJECTS and pay any
costs, expenses, attorneys' fees and damages finally awarded against or
settlements authorized by IBM, against any claim by a third party that the
modifications to the Source Code of the Licensed Work created by IBM in
accordance with Section 4.2 hereof ("IBM Derivative") infringe a copyright,
trademark or patent or misappropriate any trade secret of a third party or
otherwise violate any third party's intellectual property rights.
7.6 IBM will not be liable for any claim of infringement based on (i) the use
of the IBM Derivative in combination with any other products if such
infringement would have been avoided
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by the use of such IBM Derivative without such other products (unless such
combination is consistent with the IBM Derivative's intended use pursuant to the
accompanying documentation or has been specified by IBM); (ii) NETOBJECTS', its
distributors or its or their end-users use or distribution of such IBM
Derivative without an enhancement or error correction provided by IBM that, if
used, would have made such IBM Derivative non-infringing; (iii) any use or
distribution of an IBM Derivative in a manner not permitted under the licenses
granted to the IBM Derivative or not in accordance with the documentation
provided by IBM for such IBM Derivative; or (iv) any claim based upon any
intellectual property provided by NETOBJECTS to IBM pursuant to this Agreement.
7.7 IBM shall not be obligated to indemnify NETOBJECTS under this Section
unless (i) NETOBJECTS promptly notifies IBM in writing of any claim to which the
indemnity obligations might apply; (ii) IBM has the sole control of the defense
and/or settlement of such claim at IBM's sole cost and expense; and (iii)
NETOBJECTS reasonably cooperates with IBM in defending or settling any such
claim. Subject to the foregoing conditions, NETOBJECTS shall be entitled to
participate in the defense of any such claim at its expense.
7.8 Each party is responsible for any actual loss or damage only up to the
amount of charges paid or due (if any) for the Licensed Work or IBM Derivative
that is the subject of a claim. Neither party shall be liable to the other for
any economic consequential damages (including lost profits or savings),
indirect, or incidental damages, even if advised of their possibility. This
Section describes the parties' sole remedies and exclusive liabilities for any
breach of this Agreement. Notwithstanding the foregoing, none of the above
limitations apply to claims arising under Sections 7.1, 7.2, 7.3 7.4, 7.5, 7.6
or 7.7.
8.0 TERM AND TERMINATION
8.1 The term of this Agreement ("Term") shall begin on the Effective Time and
will continue, for ten (10) years unless terminated by IBM on thirty (30) days'
notice to NETOBJECTS. Notwithstanding the foregoing, IBM may not terminate the
Agreement after the Effective Time until the end of the Initial Period (as
defined in Section 5.0 of Exhibit B). NETOBJECTS shall have no right to
terminate this Agreement during the Term. Notwithstanding the foregoing,
nothing in this Agreement shall limit NETOBJECTS' rights at law or in equity to
seek an injunction against IBM in the event that IBM materially breaches this
Agreement.
8.2 Any provisions of this Agreement that by their nature extend beyond
termination or expiration will survive in accordance with their terms. These
include License, Representations and Warranties, Indemnification and Liability,
and General. These terms will apply to either party's successors and assigns.
Termination or expiration of this Agreement does not affect any previously
granted end user licenses granted by IBM, its Subsidiaries or Distributors
pursuant to this Agreement.
9.0 COORDINATORS
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9.1 Any notice required or permitted to be made by either party to this
Agreement must be in writing. Notices are effective when received by the
appropriate coordinator as demonstrated by reliable written confirmation (for
example, certified mail receipt).
9.2 The Contract Coordinators responsible to receive all notices, act as
liaison and administer this Agreement are:
FOR IBM: FOR NETOBJECTS:
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Contract Administrator Title: Exec. V.P.
Address: Route 100 Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇
▇▇▇▇▇ 94061
Phone: ▇▇▇-▇▇▇-▇▇▇▇ Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇ Fax: ▇▇▇-▇▇▇-▇▇▇▇
9.3 The Technical Coordinators responsible to accept all Deliverables,
coordinate all exchanges of confidential information, and administer and
coordinate the technical matters associated with this Agreement are:
FOR IBM: FOR NETOBJECTS:
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ Desarnauts
Title: Senior Product Manager Title: Dir. of Program
Lotus Notes Management
Address: One ▇▇▇▇▇▇▇ Park Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇
▇▇▇▇▇ 94061
Phone: ▇▇▇-▇▇▇-▇▇▇▇ Phone:
Fax: ▇▇▇-▇▇▇-▇▇▇▇ Fax:
9.4 A party will provide written notice to the other when its coordinators
change.
10.0 GENERAL
10.1 INDEPENDENT CONTRACTOR. Each party is an independent contractor. Neither
party is, nor will claim to be, a legal representative, partner, franchisee,
agent or employee of the other except as specifically stated in the Subsection
entitled "Copyright" below. Neither party will assume or create obligations for
the other. Each party is responsible for the direction and compensation of its
employees.
10.2 FREEDOM OF ACTION. Each party may have similar agreements with others.
Each party may design, develop, manufacture, acquire or market competitive
products and services, and
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conduct its business in whatever way it chooses. IBM is not obligated to
announce or market any products or services. IBM does not guarantee the success
of its marketing efforts. IBM will independently establish prices for its
products and services.
10.3 RELIANCE. Neither party relies on any promises, inducements or
representations made by the other or expectations of more business dealings,
except as expressly provided in this Agreement. This Agreement accurately
states the parties' agreement.
10.4 COMPLIANCE WITH APPLICABLE LAWS. Each party will comply with all
applicable laws and regulations at its expense including, to the extent
applicable, Executive Order 11246 on Equal Employment Opportunity, as amended,
the Occupational Safety and Health Act of 1970, as amended, and the Americans
With Disabilities Act of 1990, as amended. This also includes all applicable
government export and import laws and regulations.
10.5 CONFIDENTIAL INFORMATION. The parties agree that information exchanged
under this Agreement that is considered by either party to be confidential
information will be subject to the terms of the AECI referenced on the first
page of this Agreement. The parties hereby agree to extend the terms of the
AECI such that it is coextensive with the Term, and the term of the AECI will
expire ten (10) years from the Effective Date hereof. In addition, NETOBJECTS
will not provide IBM with any information which may be considered confidential
information of any third party unless provided under the AECI. The obligations
set forth in the AECI with regard to confidential information will not limit or
preclude the exercise of the licenses granted in this Agreement or the
assignment or reassignment of either party's personnel.
10.6 COPYRIGHT. Any publication by IBM of the Licensed Work or a Derivative
Work thereof may contain an appropriate copyright notice, as determined by IBM.
IBM will not remove any copyright notice of NETOBJECTS contained within the
Licensed Works.
NETOBJECTS will enforce and maintain its copyright protection in the
Licensed Work. IBM is not responsible for enforcing and maintaining such
copyright protection. However, NETOBJECTS authorizes IBM to act as NETOBJECTS'
agent in the copyright registration of the Licensed Work. At IBM's request,
NETOBJECTS agrees to provide IBM reasonable assistance in registering any
Product.
10.7 ORDER OF PRECEDENCE. If there is a conflict among the terms of this base
License Agreement and its Exhibits, the terms of this base License Agreement
prevail over those of the Exhibits, unless the parties expressly indicate in
the Attachments that particular terms within the Exhibits prevail.
Inconsistent terms in IBM's purchase orders and NETOBJECTS' invoices or
acknowledgments, if any, are void.
10.8 HEADINGS. The headings of this Agreement are for reference only. They
will not affect the meaning or interpretation of this Agreement.
10.9 COUNTERPARTS. This Agreement may be signed in one or more counterparts,
each of which will be considered an original, but all of which together form one
and the same instrument.
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10.10 AMENDMENT AND WAIVERS. For a change to this Agreement to be valid, both
parties must sign it. No approval, consent or waiver will be enforceable unless
signed by the granting party. Failure to insist on strict performance or to
exercise a right when entitled does not prevent a party from doing so later for
that breach or a future one.
10.11 ACTIONS. Neither party will bring a legal action relating to the subject
matter of this Agreement, against the other more than two (2) years after the
cause of action arose, except in the case of indemnification for infringement,
in which case this period runs for two (2) years after the award or settlement
was made.
10.12 GOVERNING LAW. The laws of the State of N.Y. (irrespective of its choice
of law principles) shall govern the enforceability and validity of this
Agreement, the construction of its terms, and the interpretation of enforcement
of the rights and duties of the parties hereto.
10.13 DISPUTE RESOLUTION. In the event of any problem, claim, or dispute
arising from, out of, or based upon this Agreement, the aggrieved party shall
promptly notify the other party of the existence of the problem, claim, or
dispute, and such other party shall promptly undertake all reasonable efforts,
including but not limited to, submitting such problem, claim or dispute for
resolution to a Manager (as defined below) of each Technical Coordinator. For
the purposes of this Section "Manager" shall mean someone in the management
chain of the applicable Technical Coordinator who is senior to such Technical
Coordinator in terms of responsibility, and who is familiar with the
administration of this Agreement. The Managers shall make a reasonable effort
to resolve the dispute as quickly as possible. In the event that the Managers
cannot resolve such dispute within sixty (60) business days the matter may at
the option of either party, be submitted for resolution to each party's
executive with overall responsibility for the subject matter in dispute. If the
matter is not resolved at the executive level, the parties may then pursue any
remedies available to them in law or equity. Each party agrees to waive its
rights to a jury trial in any litigation resulting from a dispute between the
parties concerning this Agreement.
12
EXHIBIT A
Description of Licensed Work
Object Code Licensed Work:
NETOBJECTS Fusion and all future updates and versions, and all replacements.
Delivery of Licensed Works:
Within fifteen (15) days after the Effective Date, NETOBJECTS will deliver to
IBM two (2) golden master disks in CD ROM format containing the Licensed Work in
English and all foreign language translations then commercially available, as
well as all on-line documentation and end-user documentation and other related
documentation and installation procedures in camera-ready copy form ("Licensed
Work Materials"). For all Enhancements, NETOBJECTS will deliver the Licensed
Work Materials to IBM as soon as possible, but no later than five (5) days prior
to the general availability of such Enhancements.
National Language Version:
Within seventy-five (75) days after the Effective Time, NETOBJECTS will present
to IBM a detailed outline of its planned development and delivery of
internationalized Licensed Works and translations of the Licensed Works into
languages other than U.S. English ("NLVs"), identifying, at a minimum, any
differences between the U.S.English version of the Licensed Works and any NLV,
the supported languages and the delivery dates of the NLVs ("NLV Plan").
Within fifteen (15) days after its receipt of the NLV Plan, IBM will either
accept the NLV Plan or offer an ▇▇▇▇▇▇▇▇▇ ▇▇▇ Plan.
Products:
IBM shall be entitled to add any or all future NETOBJECTS products to the
Agreement (which shall be licensed to IBM at reasonable mutually agreed upon
royalties, and in accordance with the most favored customer pricing terms
contained in Section 5.5 of the Agreement).
EXHIBIT B
ROYALTY RATE FOR LICENSED WORKS
1.0 The amounts which shall be payable to NETOBJECTS as royalties shall be
determined by application of the royalty rates for the Licensed Work as set
forth in this Exhibit B ("Royalty Rates").
2.0 All pricing terms and conditions contained in this Exhibit B are subject
to the most favored customer terms and conditions set forth in Section 5.5 of
the Agreement. In addition, in the event that any pre-existing customers of
NETOBJECTS have not converted their current pricing and discount schedules for
the Licensed Works to be the same as those reflected in this Exhibit B as of
June 30, 1998, NETOBJECTS will as of June 30, 1998 offer to IBM such prices to
the extent that they are more favorable to IBM than the prices reflected in this
Exhibit B, and upon acceptance by IBM such prices shall become effective.
3.0 Royalty Rate Tables
3.1 The "List Price" shall be NETOBJECTS' current list price for the Licensed
Work at the time that the sale of the Licensed Work is made.
3.2 The Royalty Rate table in this Section 3.2 is for offerings that contain
the Licensed Work and add significant function or value to the Licensed Work by
integrating, embedding, bundling or incorporating the Licensed Work into or with
other software or hardware, where the reasonable commercial value of such other
software or hardware is at least equivalent to the reasonable commercial value
of the Licensed Work it is Bundled with ("Hard Bundle"):
Licensed Work Cumulative Number Royalty Rate
of Units % Discount
Per Year off List Price
---------------------------------------------------------
"NetObjects
FUSION" 1 - 2,500 72.0%
2,501 - 5,000 75.0%
5,001 - 10,000 77.2%
10,001 - 25,000 78.6%
25,001 - 50,000 80.6%
50,001 - 100,000 83.5%
100,001 and above 84.6%
3.3 The Royalty Rate in this Section 3.3 is for offerings that contain the
Licensed Work and add other function or value to the Licensed Work, where the
added function or value is not sufficient to qualify as a Hard Bundle, but whose
reasonable commercial value is a) at least equivalent to 40% of the reasonable
commercial value of the Licensed Work it is Bundled with, or b) any other Bundle
which is approved by NETOBJECTS (collectively referred to as a "Soft Bundle"):
Licensed Work Cumulative Number Royalty Rate
of Units Discount %
Per Year off List Price
---------------------------------------------------------
"NetObjects
FUSION" 1 - 2,500 60.0%
2,501 - 5,000 62.02%
5,001 - 10,000 63.6%
10,001 - 25,000 64.8%
25,001 - 50,000 66.2%
50,001 - 100,000 67.1%
100,001 and above 68.0%
The following Bundles which include the Licensed Work are approved by NETOBJECTS
as Soft Bundles: a) Licensed Work Bundled with "Kona" components; and b)
Licensed Work Bundled with Java components.
3.4 The Royalty Rate for Licensed Works that are not Bundled with any hardware
or software, and for which NetObjects provides level 3 support ("N.O. Package")
is a 55% discount off NETOBJECTS' List Price for the Licensed Work..
NETOBJECTS shall include with each N.O. Package sufficient information to inform
end users of IBM's contact information for ▇▇▇▇▇ ▇ and Level 2 support, and IBM
shall provide Level 1 and Level 2 support for the N.O. Package.
3.5
A) The Royalty Rates shall apply to the units sold by IBM or any of its
Subsidiaries in any calendar year during the Term, except as set forth in
Section 5.0, below. Volumes shall be aggregated between Hard Bundle, Soft
Bundle and N.O. Package units sold during a calendar year for the purpose of
determining the applicable Royalty Rates (i.e., in a calendar year, the first
2500 units sold by IBM and its Subsidiaries shall result in the following
Royalty Rates: for each such unit which is a Hard Bundle the Royalty Rate shall
be 72% off of List Price; and each such unit which is a Soft Bundle shall be
60% off of List Price; and each such unit which is a N.O. Package shall be
60% off of List Price, all subject to Section 2.0, above. The next 2500
units sold by IBM or any of its Subsidiaries during that calendar year shall
result in the following Royalty Rates: Hard Bundle units = 75% off of List
Price; Soft Bundle units = 62.2% off of List Price; and N.O. Package units =
60% off of List Price. Subsequent units sold in that calendar
year would follow the same process through the Royalty Rate tables set forth in
this Exhibit B.)
B)
i. Notwithstanding Section 3.5 A), above, IBM shall have the option, for any
calendar year(s) during the Term to make a Volume Commitment. The "Volume
Commitment" for any calendar year during the Term shall be made in writing and
provided to NETOBJECTS, and shall consist of the number of Hard Bundle, Soft
Bundle and N.O. Package units that IBM and its Subsidiaries commit to sell
during that calendar year, if any. Where IBM elects to make a Volume Commitment
for a calendar year, each unit sold by IBM or any of its Subsidiaries during
such calendar year, up to the Volume Commitment number, shall be subject to the
Royalty Rate applicable to the Volume Commitment amount. Units sold during such
calendar year which are in excess of the Volume Commitment shall be subject to
the Royalty Rate applicable to the actual unit volumes, as described in Section
3.5 A), above (i.e., in a calendar year where IBM makes a Volume Commitment of
55,000 units of Hard Bundle and 30,000 units of Soft Bundle, each of the first
55,000 units which is a Hard Bundle shall have a Royalty Rate of 83.5% off of
List Price; each of the first 30,000 units which are Soft Bundle units shall
have a Royalty Rate of 66.2% off of List Price; and each of the units which
are N.O. Package units shall have a Royalty Rate of 60% off of List Price,
all subject to Section 2.0, above). Notwithstanding the foregoing, all of the
cumulative unit volumes sold by IBM and its Subsidiaries in the calendar year
shall be aggregated for the purpose of determining whether IBM achieved its
Volume Commitment for the calendar year (i.e., using the foregoing example,
IBM's Volume commitment of 55,000 Hard Bundle units and 30,000 Soft Bundle units
would be added (55,000 + 30,000 = 85,000) and the actual number of cumulative
units sold would be added). The difference between the cumulative number of
units sold (adding Hard Bundle units, Soft Bundle units and N.O. Package units
sold) and the cumulative Volume Commitment would be calculated. A "Shortfall"
would exist if the number of total number of cumulative units committed exceeds
the total number of cumulative units sold.
ii. At the conclusion of any calendar year in which IBM has made a Volume
Commitment, IBM shall be obligated to pay the applicable Royalty Rate for units
that make up the Shortfall, if any, between the units in the Volume Commitment
and the actual number of units sold by IBM and its Subsidiaries in such
calendar year. Any units which are paid for but unsold as a result of a
Shortfall may be sold by IBM in subsequent periods but would not be counted
against unit volumes in subsequent years. Notwithstanding the foregoing, IBM
shall not be obligated to pay for any Shortfall pursuant to this Agreement in
the event that: a)Netobjects has as of the Effective Date or does in the future
enter into any agreement pursuant to which a party receives the right to
distribute, resell or sublicense any of the Licensed Works, and b) where such
party receives a royalty rate more advantageous than the Royalty Rate applicable
to the first unit sold by IBM hereunder without the requirement to make a firm
volume commitment (where a firm volume commitment means that the party must
commit to sell a certain volume of the Licensed Works and where such party must
pay the applicable royalty based upon NETOBJECTS standard Royalty Rate schedules
for the Licensed Work for such units which make up the committed volume, whether
or not such party actually sells such committed volume of units), or c) where
such party, having made a volume commitment is not required to actually pay
NETOBJECTS the applicable royalty for units which make up the shortfall between
their volume
commitment and the actual number of units sold. Netobjects shall promptly
inform IBM if either b) or c), above, occur.
3.6 The determination of whether a package which includes a Licensed Work is a
Hard Bundle or a Soft Bundle shall be made by IBM, exercising reasonable
judgment. If NETOBJECTS does not agree with IBM's determination, the parties
shall follow the dispute resolution process outlined in Section 10.13 of this
Agreement.
The following examples are provided for the purpose of illustrating the
distinction between a Hard Bundle, a Soft Bundle and a N.O. Package:
a. EXAMPLES OF HARD BUNDLE:
-An offering which contains the Licensed Work packaged with Domino. Lotus
manufactures the product and provides level 1 and 2 support;
-An offering which contains the Licensed Work preloaded on a Network Station.
IBM manufactures the hardware, and preloads the Licensed Work, and an IBM OEM
reseller provides level 1 and 2 support;
-An offering which contains the Licensed Work packaged with the IBM Internet
Connection Secure Server. IBM distributes the product through an electronic
sales channel through an IBM web site, and IBM provides level 1 and 2 support.
b. EXAMPLES OF A SOFT BUNDLE:
-An offering which contains the Licensed Work packaged with Applet Author and a
browser. Lotus manufactures the product and provides level 1 and 2 support;
c. N.O. PACKAGE:
- A N.O. Package is a copy of a Licensed Work which was manufactured by
NetObjects, and which is not Bundled with other hardware or software.
4.0 The Royalty Rate for new versions or upgrades will be determined by
applying the same discount percentage as set forth above to the published list
price for the new products or upgrades.
5.0 Notwithstanding anything in this Exhibit B to the contrary, the period
commencing with the Effective Time, and ending 12/31/98 (the "Initial Period")
shall be considered to be the first year of the Agreement for the purpose the
Royalty Rate tables set forth in this Exhibit B, and IBM's Volume Commitment for
the Initial Period shall be 50,000 units of Hard Bundle and 35,000 units of Soft
Bundle.
DURING THE INITIAL PERIOD, IBM SHALL MAKE THE FOLLOWING NONREFUNDABLE PAYMENTS
WHICH SHALL BE CREDITABLE AGAINST ROYALTIES AND PAYMENTS WHICH BECOME DUE
PURSUANT TO THIS AGREEMENT. In the event that royalties which become due during
the Initial Period are not sufficient to fully exhaust the foregoing credit, the
remainder of the credit shall be applied against royalties and payments which
become due in subsequent years:
April 1, 1997 (or the Effective Time, whichever is later) - $1,493,257.00
July 1, 1997 - $1,493,257.00
October 1, 1997 -$1,493,257.00
January 1, 1998-$1,493,257.00
April 1, 1998 -$1,493,257.00
July 1, 1998 -$1,493,257.00
October 1, 1998 -$1,493,258.00
In the event that IBM and its Subsidiaries sell greater than 100,000 cumulative
units of Hard Bundle, Soft Bundle and N.O. Package units during the Initial
Period, IBM shall receive a credit of $250,000. which shall be applied in
calendar year 1999 against royalties due pursuant to this Agreement, to be
applied in 4 (four) equal quarterly amounts of $62,500.
EXHIBIT C
SOURCE CODE CUSTODY AGREEMENT
BASE AGREEMENT
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
This Source Code Custody Agreement ("SCCA") between NetObjects Corporation
("NetObjects"), __________________ ("Custodian") and International Business
Machines Corporation ("IBM") describes the rights and obligations of the parties
for the Escrowed Works that NetObjects delivers to Custodian. This SCCA
supplements the NetObjects License Agreement number L97063 ("NLA").
The SCCA consists of this Base Agreement and its DESCRIPTIONS OF ESCROWED WORK
("▇▇▇▇"). Each DEW together with this SCCA forms a separate agreement. The
SCCA is our complete agreement and replaces all prior oral or written
communications between us regarding the Custodian's holding of the Escrowed
Works in escrow.
By signing below for our companies, the parties agree to the terms of this Base
Agreement. Once signed, 1) all parties agree any reproduction of the SCCA made
by reliable means (for example, photocopy or facsimile) is an original unless
prohibited by local law and 2) all Escrowed Works are subject to it.
Agreed To: Agreed To:
NetObjects Corporation ("NetObjects") International Business Machines
Corporation Corporation ("IBM")
-----------------------------
By: By:
----------------------------------- -------------------------------
AUTHORIZED SIGNATURE AUTHORIZED SIGNATURE
Name: Name:
----------------------------------- -------------------------------
Date: Date:
----------------------------------- -------------------------------
NetObjects Address: IBM Office Address: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Route 100
----------------------------------- ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
----------------------------------- Mail Drop 1139
-----------------------------------
IBM Source Code Custody Agreement #:
----------
Agreed To:
---------------------------------------- License Agreement #: L97063
CUSTODIAN NAME
By: IBM/NetObjects Confidentiality Agrmt. dated 4/29/96
------------------------------------- Areement Agrm A
AUTHORIZED SIGNATURE
Name:
-----------------------------------
Date:
-----------------------------------
Custodian Address:
-----------------------------------
-----------------------------------
-----------------------------------
IBM SOURCE CODE CUSTODY AGREEMENT
BASE AGREEMENT
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
PART 1 DEFINITIONS
Capitalized terms in the SCCA have the following meanings. A DEW may define
additional terms. However, those terms apply only to that DEW.
PART 1.1 CODE is computer programming code including both Object Code and
Source Code.
a) OBJECT CODE is the computer programming code substantially in binary
form, and includes header files of the type necessary for use or interoperation
with other computer programs. It is directly executable by a computer after
processing or linking, but without compilation or assembly. Object Code is all
Code other than Source Code.
b) SOURCE CODE is the computer programming code that may be displayed in a
form readable and understandable by a programmer of ordinary skill. It includes
related source code level system documentation, comments and procedural code.
Source Code does not include Object Code.
PART 1.2 DELIVERABLE is any item that NetObjects provides under the NLA.
PART 1.3 DERIVATIVE WORK is a work that is based on an underlying work and
that would be a copyright infringement if prepared without the authorization of
the copyright owners of the underlying work. Derivative Works are subject to
the ownership rights and licenses of a party or of others in the underlying
work.
PART 1.4 ENHANCEMENTS are changes or additions including versions and
releases, other than Error Corrections, to the Licensed Work during the term of
the NLA.
PART 1.5 ERROR CORRECTIONS are revisions that correct errors and deficiencies
(collectively referred to as "Errors") in the Licensed Work created during the
term of the NLA.
PART 1.6 ESCROWED WORKS are the materials, including all updates to them, that
are described in a Description for Escrowed Work ("DEW"). They include:
a) the Source Code for the Licensed Work in machine-readable form,
including all updates to it, and the Source Code level system documentation in
hard and soft copy form;
b) a list of all Source Code modules of the Licensed Work;
c) a directory listing for each machine-readable medium;
d) commentary required to understand and use the Source Code;
e) a list of all Tools, both those that are commercially available, and
those that are not provided by IBM and are not commercially available; and
f) the Tools that NetObjects is required to escrow under the License
Agreement.
PART 1.7 EXTERNALS are (1) any pictorial, graphic, and audiovisual works (such
as icons, screens, sounds, toolbars, palettes and characters) generated by
execution of Code, and (2) any programming interfaces, languages or protocols
implemented in Code to enable interaction with other computer programs or the
end user, including application program interfaces ("API"). Externals do not
include the Code that implements them.
PART 1.8 LICENSE AGREEMENT is the NetObjects License Agreement between IBM and
NetObjects Corporation number L97063, dated March 18, 1997 ("NLA").
PART 1.9 LICENSED WORK is (1) any material described in EXHIBIT A "Description
of Licensed Work", or that is delivered to IBM as the Licensed Work, including
(but not limited to) Code, associated documentation, and Externals, and (2)
Error Corrections and Enhancements.
PART 1.10 PRODUCT is an offering to customers or other users, whether or not
branded by IBM or its Subsidiaries, that includes the Licensed work or a
Derivative Work of the Licensed Work.
PART 1.11 RELEASE EVENTS are the following occurrences when IBM may demand that
Custodian deliver the Escrowed Works to IBM:
a) NetObjects has voluntarily filed a petition under any insolvency or
bankruptcy statute in the United States;
b) NetObjects has voluntarily sought reorganization under any insolvency
or bankruptcy statute;
c) NetObjects has acknowledged in writing its insolvency or inability to
pay its debts as they become due;
d) A petition has been filed or a proceeding commenced against NetObjects
by a third party under any bankruptcy or insolvency statute, which has resulted
in an order for relief or which has not been discharged by NetObjects within one
hundred eighty (180) days of such filing or commencement of proceedings,
whichever comes first;
e) NetObjects has materially failed to comply with its obligations to
provide maintenance and support under the NLA; or
f) NetObjects has materially failed to comply with its obligation to
improve and enhance its FUSION product as set forth in EXHIBIT D of the NLA.
PART 1.12 TOOLS include devices, compilers, programming documentation, media or
other items required for the development, maintenance or implementation of a
Licensed Work or other Deliverable that are not commercially available.
PART 2 ESCROWED WORKS DEPOSITS
PART 2.1 NetObjects will:
a) deposit with Custodian two (2) copies of Escrowed Works for each
Licensed Work described in a DEW. NetObjects will identify each item in the
deposit by labeling it;
b) deliver the Escrowed Works in good condition in sealed containers;
c) provide Custodian with a nonconfidential notice of all items contained
in each container; and
d) replace all lost or damaged Escrowed Works within three (3) days of
notice from Custodian.
PART 2.2 Custodian will:
a) accept each Escrowed Works deposit in trust for IBM and send IBM a
notice confirming receipt within three (3) business days;
b) retain both the original Escrowed Works and any updates to them.
Together, these will comprise Escrowed Works;
c) match all items on the nonconfidential notice to the labels on Escrowed
Works;
d) take all reasonable steps to protect and store Escrowed Works in
appropriate containers and atmospheric conditions, segregated from other
materials;
e) promptly provide notice to IBM and NetObjects in the event of lost or
damaged Escrowed Works; and
f) store a copy of this SCCA and the nonconfidential notice of items with
Escrowed Works.
PART 2.3 If IBM provides Custodian notice to return to NetObjects or to
destroy certain portions of Escrowed Works, Custodian will do so and provide
notice to NetObjects and IBM when complete.
PART 3 ESCROWED WORKS VERIFICATION
PART 3.1 Unless IBM and Custodian agree in writing, Custodian is not
responsible for technical verification that Escrowed Works are complete,
accurate and current. IBM may, at its expense, hire a party qualified to do
this verification. NetObjects will reimburse IBM's expenses if the Escrowed
Works do not comply with the requirements of this SCCA.
PART 3.2 Verification includes generating Object Code from Source Code for
each Licensed Work. The verifier will witness the transfer of the verified
Source Code to deposited media. NetObjects will supervise the verification
which will be conducted at NetObjects' facilities unless otherwise agreed by IBM
and NetObjects.
PART 3.3 One technical IBM employee may witness verification. To the extent
possible, verification will be done in a way that does not expose the Source
Code to the IBM employee. If this is not possible, the IBM employee will treat
the Source Code according to Section 4.3d of this SCCA.
PART 4 RELEASE OF ESCROWED WORKS
PART 4.1 In the event that IBM seeks to obtain any release of the Escrowed
Works, IBM will give NetObjects and Custodian a written notice describing the
Release Event which it believes has occurred. The notice will state that IBM
intends to demand release of the Escrowed Works, and will describe the Release
Event in detail. If the Release Event is any one or
more of the Release Events described in Sections 1.11 (a) - (d) of this SCCA,
Custodian will deliver the Escrowed Works to IBM five (5) business days after
receipt of the above described notice, unless NetObjects has given Custodian and
IBM written notice that the Release Event does not exist or has been cured and
provides substantiating documentation thereof, together with IBM's written
concurrence that the Release Event did not occur or was cured. If this occurs,
Custodian will not release the Escrowed Works to IBM. If the Release Event
described in IBM's notice is described in Section 1.11(e), Custodian will
deliver the Escrowed Works to IBM five (5) business days after receipt of the
notice from IBM, unless NetObjects has provided written notice to Custodian and
IBM that it contests that the Release Event has occurred. In such case, IBM and
NetObjects will not use the dispute resolution process provisions of Section
10.13 of the NLA, but will attempt to resolve the matter within the next five
(5) business days. If they are unable to resolve the disagreement within that
time, Custodian will release the Escrowed Works to IBM and IBM shall solely be
entitled to use such works for the purpose of performing NetObjects' maintenance
and support obligations. Thereafter, NetObjects will be entitled to invoke the
dispute resolution provisions of Section 10.13 of the NLA, and if NetObjects
prevails in such proceeding, IBM will return the Escrowed Works to Custodian
when a court of competent jurisdiction finally determines that a Release Event
under Section 1.11(e) has not occurred. If the Release Event described in IBM's
notice is described in Section 1.11 (f), Custodian will deliver the Escrowed
Materials to IBM five (5) business days after receipt of the notice from IBM
unless NetObjects has provided written notice to Custodian and IBM that it
contests that the Release Event has occurred. In such case, NetObjects will be
entitled to invoke the dispute resolution provisions of Section 10.13 of the
NLA. If the dispute is not resolved within sixty (60) days, Custodian will
deliver the Escrowed Works to IBM for its use solely for the purpose of
performing NetObjects' product improvement and enhancement obligations as
provided in the NLA. If NetObjects prevails in such proceeding, IBM will return
the Escrowed Works to Custodian when a court of competent jurisdiction finally
determines that a Release Event under Section 1.11 (f) has not occurred. In no
event will Custodian be required to independently verify that a Release Event
has occurred.
PART 4.2 If IBM determines that it does not have a complete set of Escrowed
Works, IBM may request them from NetObjects. NetObjects will provide the
materials required within three (3) days of IBM's request.
PART 4.3 IBM will:
a) use Escrowed Works solely as permitted under the NLA;
b) own any Derivative Works of Escrowed Works that it creates, subject to
NetObjects' rights in the underlying work;
c) pay NetObjects the royalties specified in the NLA to maintain its
rights to the Licensed Works; and
d) treat Escrowed Works according to the AECI.
In addition to the confidentiality obligations set forth in the
AECI, IBM agrees that for a period of ten (10) years from the date of receipt of
Licensed Work Source Code:
i) to only make available the Licensed Work Source Code to IBM's
employees, its agents, subsidiaries and subcontractors on a "need to know
basis"; and
ii) to only use Source Code in accordance with the terms of the NLA, and
not to disclose it to others except as set forth herein. IBM shall protect the
Source Code using at least the same degree of care as it uses to protect its own
Source Code of a like nature, and in no event less than reasonable care.
PART 4.4 The occurrence of Release Events does not relieve NetObjects of its
obligations under the SCCA.
PART 4.5 When NetObjects signs the DEW, NetObjects grants IBM, its
subsidiaries, successors and assigns all right and title to the media containing
the Escrowed Works.
PART 4.6 If Escrowed Works are released to IBM, IBM retains its rights to the
Licensed Works as provided in the NLA. This includes IBM's right to use
NetObjects' trademarks and product names.
PART 5 NETOBJECTS' WARRANTY
NetObjects represents and warrants that:
a) it has all rights necessary for IBM to maintain, support and modify the
Licensed Works;
b) it has the authority to deliver the Escrowed Works to the Custodian;
c) Escrowed Works are sufficient to allow a programmer of ordinary skill
to understand, maintain and prepare Derivative Works using the Source Code
version of the Licensed Work; and
d) Escrowed Works are complete, accurate and current.
PART 6 LIABILITY AND INDEMNIFICATION
PART 6.1 Custodian will take all reasonable precautions to prevent disclosure
of Escrowed Works to unauthorized third parties.
PART 6.2 Custodian is liable only for willful misconduct, gross negligence and
fraud in performing its duties under this SCCA. Custodian is not liable if
NetObjects or IBM fails to comply with any provision of the NLA or this SCCA.
Custodian is not liable for acting on any notice that it in good faith believes
to be genuine and legitimate.
PART 6.3 If a third party makes a claim against Custodian:
a) NetObjects will indemnify Custodian for claims based on NetObjects'
failure to comply with this SCCA; and
b) IBM will indemnify Custodian for claims based on IBM's failure to
comply with this SCCA.
These indemnities do not apply where it is found that Custodian acted with
willful misconduct, gross negligence or fraud.
PART 6.4 The indemnifying party will pay any settlement amount that it
authorizes and all costs, damages and attorney's fees that a court finally
awards if Custodian:
a) promptly provides the indemnifying party notice of the claim; and
b) allows the indemnifying party to control and cooperates with it in the
defense of the claim and settlement negotiations.
Custodian may participate in the proceedings at its option and expense.
PART 7 TERM AND TERMINATION
PART 7.1 This SCCA begins when all parties sign it and continues until
terminated. The terms of the SCCA apply to a Licensed Work when the parties sign
the associated DEW. IBM may, at its option, extend the term of any DEW for
additional years as described in PAYMENT. IBM may, for its convenience,
terminate this SCCA or any DEW on notice to Custodian and NetObjects. However,
this SCCA will continue for any ▇▇▇▇ already in place until they are terminated
or expire.
PART 7.2 Custodian will destroy any remaining Escrowed Works thirty (30) days
after the expiration or termination of the DEW unless IBM provides notice
otherwise.
PART 7.3 Any terms of this SCCA that by their nature extend beyond its
termination (for example, RELEASE OF ESCROWED WORKS, LICENSE TO ESCROWED WORKS
and LIABILITY AND INDEMNIFICATION) will survive. These terms will apply to the
parties' respective successors and assigns.
PART 7.4 If Custodian cannot continue its responsibilities, Custodian may
resign by giving IBM and Netobjects ninety (90) days' notice. IBM will select a
successor custodian to assume Custodian's responsibilities.
PART 8 COORDINATORS
PART 8.1 SCCA Coordinators responsible to administer all matters associated
with this SCCA and its exhibits are:
FOR: IBM FOR: NETOBJECTS CORPORATION
----------------------------- ----------------------------
CORPORATIONETOBJECTS
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------- ----------------------------
Title/Dept: Procurement Professional Title/Dept: Engineering Products Manager
----------------------------- ----------------------------
Address: Rte. 100 Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
----------------------------- ----------------------------
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
----------------------------- ----------------------------
MD# 1139
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Phone: ▇▇▇-▇▇▇-▇▇▇▇ Phone:
----------------------------- ----------------------------
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇ Facsimile:
----------------------------- ----------------------------
FOR:
-------------------------------
Name:
-------------------------------
Title/Dept:
-------------------------------
Address:
-------------------------------
-------------------------------
-------------------------------
Phone:
-------------------------------
Facsimile:
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PART 1.1 Each of us will assign an Escrowed Work Coordinator in the DEW.
These coordinators are responsible to administer matters associated with the
DEW. The SCCA Coordinator and the Escrowed Work Coordinator may be the same
person. A party will provide notice to the others when coordinators change.
PART 2 PAYMENT
PART 2.1 IBM will pay Custodian within thirty (30) days after receipt of an
acceptable invoice for services under active ▇▇▇▇. All payments will be made in
U.S. dollars. The EXHIBIT: FEE SCHEDULE identifies the specified period of
Custodian's services and the firm fees for that period. Custodian may propose a
revised fee schedule to the IBM SCCA Coordinator no later than ninety (90) days
before the end of the specified period. The IBM SCCA Coordinator will notify
Custodian if it accepts or rejects the proposed fee schedule. If rejected, the
IBM and Custodian SCCA Coordinators will negotiate a new fee schedule for the
next period. The IBM and Custodian SCCA Coordinators add the new fee schedule
to the SCCA by initialing and dating it. If IBM and Custodian cannot agree to a
new fee schedule for an active DEW, it will expire at the end of its term and
IBM may select a successor custodian. Custodian will provide all assistance
required to move the Escrowed Works to the successor custodian.
PART 2.2 Custodian will invoice IBM for:
a) all services to be performed under a DEW for one (1) year; and
b) renewal of a DEW sixty (60) days before it expires. IBM may renew the
DEW for an additional year by paying the renewal fees. If Custodian does not
receive the renewal fees within thirty (30) days, it will notify the IBM
Escrowed Work Coordinator. If IBM does not pay the fees by the expiration date
of the DEW, that DEW will expire.
In addition to information required by the DEW, the invoice will identify
this SCCA, the DEW and the services invoiced plus their associated fees.
Custodian will submit all invoices as identified in the DEW.
PART 3 GENERAL
PART 3.1 Each party will comply with all applicable laws and regulations at
its expense. This includes all export and import laws and regulations.
PART 3.2 Except as provided in the SCCA, none of the parties may assign or
transfer the SCCA or its rights under it or delegate or subcontract its
obligations without the prior written approval of the other parties. Any
attempt to do so is void.
PART 3.3 If any provision of the SCCA is unenforceable at law, the rest of the
provisions remain in effect. The headings in the SCCA are for reference only.
They will not affect the meaning or interpretation of the SCCA.
PART 3.4 No party will bring a legal action against another party more than
two (2) years after the cause of action arose. All parties will act in good
faith to resolve disputes. All parties waive their rights to a jury trial in
any resulting litigation. Litigation will only be commenced in the State of New
York.
PART 3.5 All notices must be in writing. Except as provided in the SCCA, for
a change to the SCCA to be valid, IBM and NetObjects must sign it. Other than
changes to the Release Events, Custodian must also sign changes that affect its
rights or obligations under the SCCA. IBM will provide Custodian with copies of
all changes that Custodian is not required to sign.
No approval, consent or waiver will be enforceable unless signed by the
granting party. Failure to insist on strict performance or to exercise a
right when entitled does not prevent a party from doing so later for that
breach or a future one.
PART 3.6 The substantive laws of the State of New York govern the SCCA.