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EXHIBIT 10.1.5
MASTER AGREEMENT
(JAWS TECHNOLOGIES INC.)
This AGREEMENT (the "Agreement") is entered into as of NOVEMBER 24, 1998, (the
"Agreement Date"), between AI AXION INTERNET COMMUNICATIONS INC. ("Axion"), with
an address for purposes of this Agreement at ▇▇▇▇▇ ▇▇▇-▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇, and JAWS Technologies Inc. ("JAWS"), whose
principal place of business for purposes of this Agreement is ▇▇▇▇▇ ▇▇▇-▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇.
BACKGROUND
A. JAWS and Axion desire to work together with the goal of furthering
the marketing of the professional services and products of JAWS.
B. JAWS desires to enhance its consulting service and product revenues
by offering services in connection with Axion's services.
C. Axion desires to enhance its capabilities to market and support
Axion's in connection with the use of JAWS services.
D. JAWS and Axion desire to formalize their relationship by entering
into this Agreement to undertake cooperative efforts in connection with the
products and services of JAWS.
NOW, THEREFORE, JAWS and Axion agree as follows:
1. DEFINITIONS. The following capitalized terms shall have the meanings
given to them below when used in this Agreement:
"AGREEMENT DATE" shall have the meaning given to it in the introductory
paragraph of this Agreement.
"PRODUCTS" refers to all products listed in Schedule "A" and Schedule
"B" of this Agreement.
"PROPRIETARY INFORMATION" means:
(i) with respect to JAWS, the Products and all
confidential information and trade secrets contained in the
Products, including benchmark results, and any other information
of JAWS or its licensors which by its nature is generally
understood to be of a confidential nature; and
(ii) with respect to Axion, any information of
Axion or of any customer of Axion which Axion indicates is
confidential or which, by its nature, is generally understood to
be confidential information and, without limiting the generality
of the
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foregoing, includes all customer lists and pricing information
of Axion.
Information is not Proprietary Information to the extent that it:
(A) is or becomes publicly available through no act
or failure of the receiving party; or
(B) is rightfully acquired from a third party
which, to the receiving party's knowledge, is not
obligated to keep that information confidential; or
(C) is independently developed by the receiving
party.
"SERVICES" refers to all services listed in Schedule "A" Key Management
Server Pricing and Schedule "B" Software & Services Pricing of this
agreement.
"SOFTWARE LICENSE AGREEMENT" means the encryption software license
agreement(s), as amended from time to time, to be executed by JAWS and
Axion in connection with the Products.
2. SERVICES AND RESPONSIBILITIES OF JAWS
(a) Employee Training. JAWS will provide to Axion product and
service training sessions at no additional charge to Axion. These
training sessions will pertain specifically to the products and services
contracted for by Axion. Refer to Schedule "C" of this agreement for
details regarding training sessions.
(b) Marketing Events. JAWS shall participate in and, if requested
by Axion, assist in the organization and implementation of, the jointly
sponsored marketing events to be agreed upon by the parties as part of
the business plan referred to in Section 4 below.
(c) JAWS Coordinator. JAWS shall designate a coordinator with
appropriate authority to coordinate JAWS's activities with Axion and act
on behalf of JAWS within the scope of this Agreement.
3. SERVICES AND RESPONSIBILITIES OF THE PARTIES. To the extent reasonable
under the circumstances and as permitted by each party's other
agreements, the parties shall undertake the following cooperative
activities with respect to identifying opportunities to promote the
Products and Services:
(a) Market Information. Each party shall regularly inform the
other party about general market developments and factors relating to
the Products in the marketplace and current projects and customer
implementations in which they are involved. This information shall be
designated and treated as Proprietary Information of the party providing
the information.
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(b) Business Plan. Each party shall furnish the other party with
appropriate information for support and planning purposes, provided that
the furnishing party may determine, in its sole discretion, the content
and availability of such information. The parties will work together to
develop a business plan for their marketing efforts in connection with
this Agreement. Each party shall use commercially reasonable efforts to
meet the goals in the business plan.
(c) Internal Notification. Each party shall inform the
appropriate personnel in its organization of the existence of this
Agreement.
(d) New Product Information. Each party shall endeavor to keep
the other party appraised about new products and services relating to
the Products.
(e) Other Information. The parties shall exchange such other
information and conduct such other activities as the parties agree will
carry out the intent of this Agreement.
(f) Periodic Review. The parties shall meet at least twice a year
to review the status of their arrangement under this Agreement.
4. REPRESENTATIONS, WARRANTIES AND DISCLAIMERS
(a) Representations and Warranties. Each party hereby represents
and warrants to the other party that:
(i) Authority. It has the right and power to enter into this
Agreement.
(ii) No Violation. Entering into this Agreement does not
violate the terms and conditions of any of its other agreements
providing for cooperative marketing of products of another entity, or
any other legal obligations.
(iii) No Infringement. The products, materials and information
it provides under this Agreement to the other party do not infringe
upon or constitute a misappropriation of any copyright, trademark,
patent, trade secret or other proprietary right of any third party in
the Territory.
(b) Disclaimer of Warranty. EXCEPT AS SPECIFICALLY SET FORTH IN
THIS SECTION 5, NEITHER PARTY MAKES ANY WARRANTY TO THE OTHER PARTY,
EITHER EXPRESS, IMPLIED OR STATUTORY, NOR SHALL ANY WARRANTY ARISE BY
COURSE OF CONDUCT OR BY PERFORMANCE, CUSTOM OR USAGE IN THE TRADE,
INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTIES OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE.
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5. TERM AND TERMINATION
(a) Initial Term. This Agreement shall have an initial term
commencing on the Agreement Date and continuing on perpetually, unless
terminated by either party.
(b) Termination. Each party may terminate this Agreement:
(i) In the event the other party fails to cure a material
breach of this Agreement within 30 days after receiving written
notice of that breach; or
(ii) immediately upon written notice if: (A) there is a
consolidation, merger or reorganization of the other party with or
into another corporation or entity; (B) there is a creation of a new
majority interest in, or change in majority ownership or control of,
the other party; (C) there is a sale of all or substantially all of
the assets of the other party; or (D) the other party breaches the
confidentiality provisions set forth in Section 9, below; or
(iii) upon 90 days prior written notice to the other party,
with or without cause.
(c) Effect of Termination or Expiration. Upon termination or
expiration of this Agreement, each party shall cease acting in a manner
that would suggest any continuing relationship between the parties
regarding the Products, and shall cease all display and advertising
contemplated under this Agreement. Within 30 business days after the
termination or expiration, each party shall return to the other party or
dispose of (as mutually agreed) all advertising materials and other
property, including all Proprietary Information, furnished to it by the
other party pursuant to this Agreement. Each party shall certify in
writing to the other that it has done so. Termination or expiration of
this Agreement shall not affect any obligation either party has to its
customers. The following provisions of this Agreement shall in all
events survive its termination or expiration: Section 5
(Representations, Warranties and Disclaimers), 6 (Term and Termination),
7 (Relationship of the Parties), 8 (Intellectual Property Rights), 9
(Confidentiality of Proprietary Information), and 11 (General
Provisions).
6. RELATIONSHIP OF PARTIES. The following provisions shall apply to the
relationship of the parties, notwithstanding any other provision of this
Agreement:
(a) Independent Companies. JAWS and Axion are independent
companies acting for their own account, and neither party is authorized
to make any representation or commitment on behalf of the other party.
Neither party shall use the terms "joint venture", "partner",
"partnership" or similar terms to describe the relationship between the
parties under this Agreement. Any inadvertent use of such terms shall
refer to the spirit of cooperation between the parties and shall not
create a legal partnership or joint venture or any responsibility by one
party for the actions of the other, either expressly or by implication.
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7. INTELLECTUAL PROPERTY RIGHTS
(a) Trademarks, Etc. This Agreement does not authorize either party
to use or display any names, trademarks, logos or service marks of the
other party except to identify Products and Services to the extent
permitted by this Agreement. Either party may use the trademarks or
other proprietary words or symbols of the other party to properly
identify the Products or Services of the other party in correspondence
and proposals issued in the ordinary course of business to the extent
such use would be permitted by applicable law in the absence of this
Agreement. Except as described in the preceding sentence, each party
shall submit to the other party for written prepublication approval, any
materials which may use or display any name, trademark, logo or service
▇▇▇▇ of the other party.
8. CONFIDENTIALITY OF PROPRIETARY INFORMATION. Each party acknowledges
that, during the term of this Agreement, it will receive Proprietary
Information from the other party. Each party shall protect the
Proprietary Information of the other party with at least the same
protection and care that it customarily uses in safeguarding its own
confidential information of a similar nature, but shall use no less than
a reasonable degree of care and will not use the Propriety Information
of the other party for any purpose other than in direct connection with
the relationship described under this Agreement. Each party will
disclose the other party's Proprietary Information to its personnel only
on a need-to-know basis. Each party shall take reasonable steps to
advise its employees of the confidential nature of the other party's
Proprietary Information and their obligation to comply with the
confidentiality requirements in this Agreement. Each party will promptly
notify the other if it believes that Proprietary Information has lost
its status as such.
9. EXCLUSIVITY Axion will have exclusivity in Vancouver, British Columbia
for a period of six (6) months beginning January 1, 1999. The following
provisions will apply:
(a) E-mail Encryption Service. JAWS will not sell or license or
provide or permit the use of any of its Products or Services, or allow
any subsidiary or affiliate or reseller or licensee to sell or license or
provide or permit the use of any of the Products or Services of JAWS, to
or by any customer or potential customer of such Products or Services
located in Vancouver, British Columbia.
(b) Business Inquiries. JAWS will refer to Axion, and cause its
subsidiaries, affiliates, resellers and licensees to refer to Axion all
inquiries from customers (residential and corporate) located in British
Columbia.
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10. FINANCIAL OBLIGATIONS.
(a) Royalties. JAWS agrees to provide Axion with the management and
maintenance of the Key Management Server. This server will adhere to the
specifications agreed to by both parties for E-mail encryption services.
This server will be located at ▇▇▇, ▇▇▇-▇▇▇ ▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇, being JAWS's principal place of business. The parties may from
time to time by mutual agreement provide other services pursuant to this
agreement for such terms and at such costs as may be agreed by the
execution of additional schedules covering such items and such schedules
shall constitute part of this agreement for all purposes as if the
provisions there of were set forth herein.
(i) Axion will pay JAWS the royalties for the Key
Management Server, as per Schedule "A" of this agreement. These
royalties will be calculated in accordance with the table on Schedule
"A" attached. For clarity, Axion will be permitted to charge to any
recipient of an encrypted E-mail for the decryption of that E-mail
and there will no additional charge from JAWS to any customer of
Axion for the decryption of such encrypted E-mail.
(b) Reseller. JAWS hereby appoints Axion as a reseller of, and
grants to Axion the right to resell as per Schedule "B" of
this agreement. For clarity the software and services are: L5
E-mail Encryption Software
L5 Data Encryption Software
Security Audits
(i) Distribution. JAWS agrees to supply to Axion
master distributable images of Software Products. JAWS further agrees to
send new master distributable images of Products within fourteen (14)
days of release of revised versions of Products. JAWS also agrees to
notify Axion within fourteen (14) days of discontinuation of Product.
(ii) Downloads and Collection. Axion further agrees to
make the Software Products available for download and payment from
customers via the Internet. Axion shall make reasonable efforts to
maintain the availability of on-line delivery and payment. However, JAWS
acknowledges that periodic computer server and network failures are
unavoidable and thus will not hold Axion liable for damages or losses
incurred as a result of such failures.
(iii) Shipping. For L5 products that are not delivered
by download via the Internet, JAWS agrees to forward all necessary
customer and shipping information to Axion's fulfillment center after
the transaction has been approved by JAWS. Axion is responsible for
ensuring that Product is shipped to customer according to preference and
time frame selected by Customer. In the case that Products have not been
shipped to Customer within three business days, Axion will refund
payment to Customer.
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(iv) Force Majeure. Neither party shall be liable for
the failure to perform any of its obligations under this agreement,
except for payment obligations, if such failure is caused by the
occurrence of any event beyond the reasonable control of such party,
including without limitation, fire flood, strikes, and other industrial
disturbances, failure of raw materials, suppliers, failure of transport,
accidents, riots, insurrections, acts of God or orders of governmental
agencies.
(v) Audit. For all audit services JAWS agrees to
forward all necessary customer information to Axion, and to provide
sales support as required.
(vi) Direct Sales and Distribution Sales. For the
direct sales of Products described in Schedule "B", Axion will pay to
JAWS the price specified in Schedule "B". For services provided to
service customers, JAWS will pay Axion the amounts specified in Schedule
"B".
(vii) Payments and Reports. Payments shall be made on
the thirtieth (30th) day of each month, or the last day of February, for
sales of the previous month. Axion shall provide JAWS a monthly report
detailing the Products sold and amounts collected.
(viii) Returns. If under any circumstance a payment
transaction for a Product is reversed, the net amount of the reversal
will be deducted from the amount of the payment due to JAWS. If returns
exceed sales in any given month, JAWS agrees to make payment sufficient
to cover returns. JAWS will accept the return or exchange of any
normally stocked product purchased from JAWS which is unopened for up to
30 days after the date of purchase. All Hardware Items must be returned
within fourteen (14) days. A defective Product may be exchanged for the
same title only and, in this case, the entire package (box, contents,
and product-registration card) must be included. Axion will also refuse
payment for the distribution of Products to any Customer that is clearly
abusing the system by processing a large percentage of returns.
(ix) Charge Backs. If a payment transaction for a
Product is reversed due to a credit card chargeback, the net amount of
the reversal will be deducted from the amount due to JAWS. A credit card
chargeback will be allowed if Axion is bound to reverse or reimburse a
credit card payment made to Axion because the credit card provider
directs it to do so or, as it is otherwise required by law.
(x) Records and Audits. Axion shall keep records and
accounts in accordance with generally accepted accounting principles to
show the amount of proceeds payable to JAWS. Axion shall keep these
records at Axion's principal place of business. JAWS shall have the
right to conduct at its sole expense an audit of such records by an
independent auditor during regular business hours upon five (5) days
prior written notice once per calendar year to determine Electronic
Distributor's compliance with this Agreement.
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11. MOST FAVORED CUSTOMER PRICING. JAWS warrants that it has not, directly
or indirectly, entered into any agreement relating to the Products and
Services which provides pricing terms which are more favorable than the
pricing terms specified in this Agreement. If JAWS has entered into any
such agreement, or in the future enters into any such agreement, which
contains pricing terms which are more favorable than the pricing terms
specified in this Agreement, then JAWS will immediately notify Axion and
extend the same pricing terms to Axion.
12. GENERAL PROVISIONS
(a) Non-Solicitation. During the term of this Agreement and for a
period of 12 months thereafter, personnel of either party who have been
directly and substantially involved in the performance of such party's
obligations under this Agreement shall not knowingly directly or
indirectly solicit for employment any of the other party's personnel who
have been directly and substantively involved in the performance of this
Agreement, without the prior written consent of the other party.
(b) Notice. All notices required to be given under this Agreement
shall be in writing and will be deemed given when actually received. All
notices shall be sent to the receiving party's address as set forth
below, or to such other address that a party provides as required by
this Section 11(b).
For JAWS:
JAWS Technologies Inc.
▇▇▇ ▇▇▇ - ▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attn. ▇▇▇▇▇ ▇▇▇▇▇▇
Vice President Sales & Channel Development
And to:
For Axion:
AI Axion Internet Communications Inc.
▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Attn. ▇▇▇ ▇▇▇▇
Chief Operating Officer
(c) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the Province of Alberta, without
reference to its choice of law rules.
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(d) Amendments. This Agreement may not be modified except in writing
signed by both parties.
(e) Severability. If any provision of this Agreement is held invalid,
such provision shall be deemed severed and the remaining provisions
shall be interpreted so as best to reasonably effect the intent of the
parties.
(f) Non-Assignment. Neither party may assign, transfer or delegate
this Agreement, or any of its rights or obligations under this Agreement
to any third party, other than a party controlling, controlled by or
under control with the assigning party, without the prior written
agreement of the other party. Subject to the above, this Agreement shall
be binding upon and inure to the benefit of the parties of this
Agreement, as well as their respective permitted successors and assigns.
Any assignment permitted under this section will not release the
assignor from liability under this Agreement.
(g) Waiver. Failure by any party to enforce any of the terms or
conditions of this Agreement, in any one or more instances, shall not be
construed as a waiver of the future performance of any such terms or
conditions.
(h) Limitation on Damages. Neither party (nor any of its licensors)
shall have any liability to the other party or any third parties for any
loss of business, loss of profits, loss of data, or computer
malfunction, or any indirect, incidental, special, consequential or
punitive damages, even if such party has been appraised of the
possibility of that loss or damage.
(i) Press Release and Publicity. Neither party shall issue any
news release, public announcement, advertisement or publicity
concerning this Agreement or any matters arising under this
Agreement without the prior written approval of the other
party such approval not to be unreasonably withheld.
IN WITNESS WHEREOF, the parties have caused this Master Agreement to be signed
by the authorized representatives as of the date first shown above.
JAWS TECHNOLOGIES INC. AI AXION INTERNET COMMUNICATIONS INC.
By:_______________________________ By:___________________________
Date: Date:
Name: ▇▇▇▇▇ ▇▇▇▇▇▇ Name: ▇▇▇ ▇▇▇▇
Title: Vice President Sales & Channel Development Title: Chief Operating Officer
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SCHEDULE "A"
KEY MANAGEMENT SERVER PRICING
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SERVICE PROVIDED DETAIL OF SERVICE SUBSCRIPTION
RATE
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E-MAIL ENCRYPTION DIAL UP ACCESS USERS INCLUDES:
Residential (Home Market)
Small Home Office
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=1,000 subscribers $1.00 /month
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1,001 - 5,000 for a total of all $0.75/month
subscribers
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5,001 - 10,000 for a total of all $0.50/month
subscribers
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10,001 + for a total of all $0.35/month
subscribers
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E-MAIL ENCRYPTION CORPORATE ACCOUNTS
By number of subscribers per
corporate account
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15 to 50 users - 1st 20 users $20.00/month
20 + users $0.50/month per
additional user
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51 to 200 users - 1st 65 users $40.00/month
65 + users $0.50/month per
additional user
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200 + users = custom quote To be determined
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SCHEDULE "B"
SOFTWARE & SERVICES PRICING
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PRODUCT NAME SUGGESTED RETAIL PRICE PRICE
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L5 E-MAIL ENCRYPTION SOFTWARE $US14.95 $US12.95
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L5 DATA ENCRYPTION SOFTWARE
- PROFESSIONAL EDITION
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- electronic downloadable $US49.95 $US39.95
file.
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- retail boxed product $US49.95 $US34.95
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SERVICES PRICING - AUDITS
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- Snapshot Audit $CDN3,000.00 $CDN2,000.00
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- Full Security variable 10% finders fee
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SCHEDULE "C"
PRODUCT AND SERVICE TRAINING
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TRAINING PROVIDED DETAIL OF TRAINING LENGTH
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L5 E-MAIL ENCRYPTION Server Management N/A
Orientation - user
Key Management documentation
- online help
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L5 DATA ENCRYPTION User documentation included N/A
with Software
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SERVICES Sales & Marketing One (1) day
- E-mail - audit overview
Encryption - how to position and sell
- Audits audits
- how to position and sell
secure E-mail
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