Exhibit 10.4
ProductivIT Maintenance, Support and Portal Access Agreement
This agreement ("Agreement") is made and entered into in between DynTek
Services, Inc., a Delaware corporation with offices at ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter referred to as "DynTek") and Child
Support Technologies, Inc., a Mississippi corporation, having offices located at
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("CST"), as of
March 1, 2004 (the "Effective Date").
WHEREAS, DynTek owns the ProductivIT product; and
WHEREAS, CST has been granted licenses to ProductivIT under separate
agreement styled ProductivIT Sale Agreement of even date herewith (the "Sale
Agreement"); and
WHEREAS, the parties wish to memorialize the terms and conditions under
which CST will receive maintenance, support and ongoing portal access relating
to ProductivIT;
NOW, THEREFORE, the parties agree as follows:
Terms and Conditions
1. Definitions. The definitions herein shall apply to any defined term,
whenever it appears in this document, with or without quotation marks and/or
capitalization, unless such definition would result in absurdity or contradict
the intent of this document, in which case the term shall be defined by the
plain meaning of the words.
a. ProductivIT shall mean the ProductivITTM products.
b. Discontinued Products shall mean obsolete Products that DynTek no
longer develops or supports. Discontinued Products shall not include
previous versions of products that have been upgraded.
c. Third Party Clients shall mean those persons or organizations
receiving services from CST or its affiliates not for resale and
shall be interchangeable with Retail Customers.
d. Services shall mean the services to be provided by DynTek described
in Section 2.
All capitalized terms used herein and not otherwise defined shall have the
meanings ascribed thereto in the Sale Agreement.
2. Services and Pricing. For and in consideration of the license fee being
paid to DynTek by CST under the Sale Agreement, $ 150,000 is allocated for CST
to receive standard ProductiveIT maintenance and support for ProductiveIT
licenses issued under the Sale Agreement (the "Services"). Support and
maintenance includes, but is not limited to, ProductivIT localization for up to
four agents, ongoing portal access and support of future versions of Microsoft
Desktop Operating Systems. The fees being paid under the Sale Agreement are all
inclusive. No additional amounts will be charged for taxes applicable to the
Services, including, but not limited to federal, state or local taxes, or sales,
use,
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excise, ad valorem or other taxes or duties. DynTek is solely responsible
for the payment of all such taxes when applicable and shall indemnify and hold
CST harmless from the same.
3. Product Changes. DynTek shall have no obligation to support any
Discontinued Product for longer than one year from the date it becomes
discontinued.
4. Relationship of Parties. The parties agree that this Agreement is between
merchants and has been negotiated at arms length. No agency, partnership or
joint venture is intended or created hereby except to the extent that CST is
acting as an independent merchant, receiving DynTek's Services in the normal
flow of commerce. Neither party shall have any authority to bind the other
except as specifically provided herein. Nothing in this Agreement shall be
construed to (i) give either party the power to direct and control the
day-to-day activities of the other, (ii) constitute the parties as partners,
joint venturers, co-owners or otherwise as participants in a joint or common
undertaking, or (iii) allow either party to create or assume any obligation on
behalf of the other party for any purpose whatsoever. All financial obligations
associated with a party's business are the sole responsibility of such party.
All sales and other agreements between CST and its customers are CST's exclusive
responsibility and shall have no effect on CST's obligations under this
Agreement. Each party shall be solely responsible for, and shall defend, upon
the other party's request and approval of counsel, indemnify and hold the other
party free and harmless from any and all claims, damages or lawsuits (including
such other party's reasonable attorneys' fees) arising out of the acts of a
party, its employees or its agents, which legal and other proceedings for which
indemnification is sought shall be conducted with counsel reasonably
satisfactory to the indemnified party.
5. Proprietary Rights and Confidentiality
a. Confidentiality. Each party agrees that at all times during and after
the term of this Agreement it will not use in any way for its own account
or the account of any third party, nor disclose to any third party any of
the other party's' product sales and marketing information, customer lists
and pricing information, or other confidential information of the other
party, and shall take every reasonable precaution to protect the
confidentiality of such information. CST shall not publish any technical
description of ProductiivIT or beyond the description published by DynTek
without the express, written consent of DynTek.
b. Indemnification. DynTek will defend at its expense any action brought
against CST and/or any employee, partner, customer, agent and/or affiliate
of CST, including any parent corporation of CST, to the extent based upon
the claim that a ProductivIT or the Services, or any part thereof,
infringes any duly issued United States patent, copyright or other
intellectual property right of a third party ("intellectual property
right") and shall pay any settlements or judgments to the extent based
thereon; provided DynTek shall have had sole control of the defense of any
such action or settlement negotiations with respect thereto, and no
settlement of any such action occurred without the consent of DynTek; and
provided further that CST notifies DynTek promptly in writing of such
claim, suit or proceeding and, at DynTek's expense (except the value of
time of CST's employees), gives DynTek adequate information and otherwise
cooperates with DynTek.
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If ProductivIT becomes or the Services become, or in the opinion of
DynTek, may become, subject to any claim of infringement of any
intellectual property right, DynTek may, at its option: (i) procure for
CST the right to use ProductivIT or Services; (ii) replace or modify the
ProductivIT or Services, or any part thereof to make it non-infringing; or
(iii) remove ProductivIT or cease providing the Services, or part thereof,
and refund the aggregate payments paid therefor to DynTek under the Sale
Agreement less a reasonable sum for the benefits of CST's prior use of
ProductivIT.
c. Entire Liability. The foregoing provisions of this section state the
entire liability and obligation of DynTek and the exclusive remedy of CST
and its customers with respect to the alleged infringement of any
intellectual property right by ProductivIT or the Services or any part
thereof.
6. Limitation of Liability. DynTek's liability arising out of this Agreement
(other than DynTek's liability and obligations under Section 5 hereof which
shall not be subject to the limitations of this Section 6), the termination
thereof, and/or provision of Services shall be limited to the amount paid by CST
for the licenses supported hereunder. In no event shall DynTek be liable for
cost of procurement of substitute goods by anyone. Except as set forth in
Section 5, in no event shall DynTek be liable to CST or any other entity for any
special, consequential, incidental or other damages, however caused, whether for
breach of contract or otherwise, and whether or not CST has been advised of the
possibility of such damage. This limitation shall apply notwithstanding any
failure of essential purpose of any limited remedy provided herein.
8. Term and Termination.
a. This Agreement shall be effective upon its Effective Date and shall
continue for the duration of the licenses granted under the Sale
Agreement.
b. Termination for Cause. If either party defaults in the performance of
any provision of this Agreement for Cause (other than a Payment Default
which falls within the definition of Cause, which shall only have a ten
(10) day cure period following notice), then the non-defaulting party may
give notice to the defaulting party that if the default is not cured
within thirty (30) days the Agreement will be terminated. If the
non-defaulting party gives such notice and the default is not cured during
the thirty (30) day period, the Agreement shall terminate immediately upon
written notice by the non-defaulting party. For purposes of this
Agreement, "Cause" is an event of default as defined in Section 8.c.(1)and
(2) below.
c. This Agreement may be terminated by the non-defaulting party if any of
the following events of default occur: (1) if a party materially fails to
perform or comply with this Agreement or any provision hereof (including
but not limited to any failure to make a payment when due as provided in
this Agreement); (2) if either party fails to strictly comply with the
provisions of Section 5.a. (Confidentiality); (3) if a party becomes
insolvent or admits in writing its inability to pay its debts as they
mature, or makes an assignment for the benefit of creditors; (4) if a
petition under any foreign, state, or United States bankruptcy act,
receivership statute, or the like, as they now exist, or as they may be
amended, is filed by a party; or (5) if such a petition is filed by any
third party, or an application for a receiver is made by anyone and such
petition or application is not dismissed within sixty (60) days.
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Termination by the non-defaulting party under subprovisions (3) through
(5) above may be effected immediately upon occurrence of such events.
d. Obligations on Termination. Within ten (10) days after termination of
this Agreement by DynTek due to a default of CST, CST shall cease and
desist all use of the Software and Documentation and shall return to
DynTek all full or partial copies of the Software and Documentation in
Licensee's possession or under its control.
e. Portal Support. In event DynTek ceases to conduct business or is unable
to provide ongoing access to the portal due to financial constraints or
other factors, CST is hereby granted the perpetual right to receive, use
and operate the portal server application and intellectual property rights
as necessary for the limited purpose of operating the portal in support of
the licenses purchased under the Sale Agreement.
f. Return of Materials. Within thirty (30) days after the termination or
expiration of this Agreement, CST shall return to all DynTek confidential
information and other DynTek materials in its possession for shipment, as
DynTek may direct, at DynTek's expense.
10. Waiver of Certain Rights; Parties. This Agreement extends certain rights
not only to CST but also to affiliates of CST. Notwithstanding the above, DynTek
and its successors and assigns agree to look solely to CST and its assets for
the performance of CST's obligations hereunder and under the Sale Agreement,
including, but not limited to, the payment of the Purchase Price under the Sale
Agreement. Under no circumstances shall DynTek or its successors or assigns hold
or attempt to hold any officer, director, incorporator, shareholder (including,
but not necessarily limited to, Young ▇▇▇▇▇▇▇▇, P.C.) or employee liable or
responsible for the performance of CST's obligations hereunder or under the Sale
Agreement, under any legal or equitable theory of any nature, their recourse
being limited solely to CST and its assets.
11. General Provisions
a) Governing Law and Jurisdiction. Subject to the parties' agreement to
arbitrate, any action or proceeding seeking to enforce any provision of,
or based on any right arising out of, this Agreement shall be brought
against any of the parties only within the courts of the State of
Mississippi, County of ▇▇▇▇▇, and each of the parties consents to the
jurisdiction of such courts (and of the appropriate appellate courts) in
any such action or proceeding and waives any objection to venue laid
therein.
b) Binding Arbitration.
i) Any controversy or claim arising out of or relating to this
Agreement for the breach hereof which cannot be settled by the
parties shall be settled by arbitration in accordance with the
commercial arbitration rules of the American Arbitration Association
("AAA") as set forth herein.
ii) Each party may select one arbitrator. Selection shall be completed
within ten (10) days of the receipt of a demand for arbitration. If
either party fails to select an arbitrator within such ten- (10) day
period, the one selected shall act as sole
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arbitrator. If two arbitrators have been selected, the two
arbitrators selected shall select a third within fifteen (15) days
after their selection. If they fail to do so, the AAA shall select
the third arbitrator. The arbitrators shall set a date of hearing no
later than sixty (60) days from the date all arbitrators have been
selected. If the amount in controversy is less than $10,000.00, the
parties shall mutually agree on one arbitrator to conduct the
binding arbitration as mutually agreed by the parties outside of the
AAA process. If the parties are unable to mutually agree upon one
arbitrator or the alternative arbitration process within (10) days
of the receipt of a demand for arbitration, the arbitration shall be
conducted by the AAA as described above.
iii) The arbitration shall take place in Dallas, Texas.
iv) The award of any arbitration shall be final, conclusive and binding
on the parties hereto.
v) The arbitrators may award any legal or equitable remedy. Judgment
upon any arbitration award may be entered and enforced in any court
of competent jurisdiction.
vi) Either party to arbitration hereunder may bring an action for
injunctive relief against the other party if such action is
necessary to preserve jurisdiction of the arbitrators or to maintain
status quo pending the arbitrators' decision. Any such action called
pursuant to this paragraph shall be discontinued upon assumption of
jurisdiction by the arbitrators and their opportunity to consider
the request for equitable relief pending final decision in the
arbitration. c) Survival of Certain Terms. The provisions herein
relating to the obligations to protect the other's trade secrets,
copyrights, trademarks and proprietary and property rights and
relating to enforcement of this Agreement, indemnity and warranties
shall survive the termination or expiration of this Agreement for
any reason. All other right and obligations of the parties shall
cease upon termination or expiration of this Agreement.
d) Entire Agreement. This Agreement, (including the Exhibits and Attachments
which are attached hereto and referenced on the cover page, if any),
constitutes the entire agreement of the parties with respect to the
ProductivIT maintenance and support to be provided to CST and supercedes
all prior agreements and understandings between them with respect to such
matters. The Sale Agreement has been entered into regarding the license of
ProductivIT. No modification of this Agreement, nor any waiver of any
rights under this Agreement, shall be effective unless in writing and
signed by both parties.
e) Independent Review. Each party declares that, prior to the execution of
this Agreement, they apprised themselves of sufficient relevant data,
through their legal counsel or through other sources of their own
selection, in order that they might intelligently exercise their own
judgment in deciding whether to execute, and deciding on, the contents of
this Agreement. They further declare that, except as set forth herein,
their decision was not based on or influenced by any declarations or
representations of the other party hereto, or of the agents or employees
of such other party.
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f) Notices. All notices or other communications hereunder shall be in writing
and shall be given (and shall be deemed to have been duly given upon
receipt) by delivery in person, one day after delivery for next day
service to a nationally recognized overnight courier, by facsimile
transmission (with confirmation back of receipt), or five (5) days after
being mailed by registered or certified mail (return receipt requested),
postage prepaid, with an acknowledgment of receipt signed by the addressee
or an authorized representative thereof, addressed as follows (or to such
other address for a party as shall be specified by like notice; provided
that notice of a change of address shall be effective only upon receipt
thereof:
To DynTek: To CST:
DynTek Services, Inc. Child Support Technologies, Inc.
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇ P. O. Box 23059
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇. ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Suite 250 ATTN: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (mail)
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(street)
Phone: ▇▇▇-▇▇▇-▇▇▇▇ Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇ Fax: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to: With a copy to:
DynTek Services, Inc. Young, Williams, ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.A.
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ P. O. Box 23059
VP Finance ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇ ▇. ▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ATTN: ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇, Esq.
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇. ▇▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇ Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇ Fax: ▇▇▇-▇▇▇-▇▇▇▇
And
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
g) Force Majeure. Nonperformance of either party shall be excused to the
extent that performance is rendered impossible by strike, fire, flood,
governmental acts or orders or restrictions, failure of suppliers, or any
other reason where failure to
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perform is beyond the control and not caused by the negligence of the
non-performing party.
h) Non-assignability and Binding Effect. A mutually agreed consideration for
DynTek entering into this Agreement is the reputation, business standing,
and goodwill already honored and enjoyed by CST and its affiliates under
its present ownership, and accordingly, CST agrees that it's rights and
obligations under this Agreement may not be transferred or assigned
directly or indirectly to anyone, by operation of law or otherwise, to
anyone other than its current affiliates, without the prior written
consent of DynTek. Subject to the foregoing sentence, this Agreement shall
be binding upon and inure to the benefit of the parties hereto, their
successors and assigns.
i) Partial Invalidity. If any provision of this Agreement (other than Section
9) is held to be invalid by a court of competent jurisdiction, then the
remaining provisions shall nevertheless remain in full force and effect.
The parties agree to negotiate in good faith any term held invalid (other
than Section 9) and to be bound by the mutually agreed substitute
provision. If Section 9 is held to be invalid by a court of competent
jurisdiction, this entire Agreement shall be null and void; provided,
however, DynTek and its successors and assigns still shall be deemed to
have waived any and all rights to recover any damages from any person or
entity other than CST, whether under quantum meruit, any other equitable
theory or otherwise.
j) Legal Expenses. The prevailing party in any legal action arising out of
this Agreement shall be entitled, in addition to any other rights and
remedies it may have, to reimbursement for its expenses, including court
costs and reasonable attorney's fees.
k) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original and which together shall constitute one
instrument.
l) Waiver. The failure of either party to exercise any right created hereby
shall not be deemed a waiver of that right.
m) Headings. The headings contained herein are not definitions, but rather
are intended as topical finding aids and shall have no legal effect
whatsoever.
IN WITNESS WHEREOF, the parties hereto have, through duly authorized officials,
executed this as of the Effective Date.
DYNTEK SERVICES, INC. CHILD SUPPORT TECHNOLOGIES, INC.
By: By:
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Name: Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: Title: President
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Date: Date:
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