Electronic Software Distribution Agreement
This Agreement is made and entered into on (date) May 27/98 by and between
Digital River, Inc., its successors or assigns, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ("DR") and
(company name) PROMARK SOFTWARE INC. located at
(address) ▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
(▇▇▇▇▇ & ▇▇▇) ▇▇ ▇▇▇ ▇▇▇ corporation (hereafter referred to as "Vendor"),
with its principal office at (address) SAME AS ABOVE
BACKGROUND
a. Vendor is the Owner of all rights (or has a license to sell) to the
Software as defined hereunder.
b. Vendor desires to enter into an Agreement with DR to allow DR to
distribute the Software.
c. DR desires to obtain the right to distribute the Software.
NOW THEREFORE, the parties agree as follows:
1. DEFINITIONS
a. Software: the executable object code for Vendor's software identified on
Exhibit B, including all subsequent versions thereof provided to DR pursuant to
this Agreement.
b. Documentation: all computer readable and/or printed instructions,
manuals and other materials normally provided from time to time by Vendor to End
Users for use of the Software, that are identified on exhibit B, and all
subsequent versions thereof provided to DR pursuant to this Agreement.
c. End-User License Agreement ("▇▇▇▇"): the computer readable license
agreement provided by Vendor that governs the use of the Product by End Users,
and which is to be included with each copy of the Product sold by DR hereunder.
d. DR Materials: computer readable materials provided by DR for inclusion
in an electronic package containing the Software, Documentation, and ▇▇▇▇, which
materials have been approved by Vendor.
e. Product: a copy of the Software, Documentation, ▇▇▇▇ and DR Materials,
if any, packaged in computer readable form together for electronic delivery on
▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ (or equivalent) and/or in tangible packaged form for
delivery in accordance with this Agreement.
f. End User: person(s) or entity(ies) that acquire a Produce for use rather
than resale or distribution.
g. Vendor Trademarks: the trademarks, trade names, and logos used by Vendor
and identified on Exhibit B.
h. Territory: all countries in the world except (i) countries to which
export or re-export of any Product, or the direct products of any Product is
prohibited by United States law without first obtaining the permission of the
United States Office of Export Administration or its successor, and (ii)
countries that may be hereafter explicitly excluded pursuant to the terms of
this Agreement.
i. Dealer: person(s) or entity(ies) that resell the Product.
2. LICENSE
a. Vendor hereby grants DR, within the Territory, a license and right to:
1. Reproduce and distribute the Product in computer readable form to the End
User and/or Dealer as indicated on Exhibit B;
2. Package the Product in a computer readable manner reasonably specified by
Vendor;
3. Utilize the Vendor Trademarks in connection with the replication of the
Product, packaging and distribution of the Product, in a manner reasonably
specified by Vendor; and
4. Distribute in tangible form the Product to the End User and/or Dealer as
indicated on Exhibit B.
b. The rights granted to DR pursuant to this Agreement shall be deemed to
include the right to designate and sell to Dealers which re-sell the Product to
the End User.
c. DR acknowledges that the Software and Documentation are the property of
Vendor or its licensors and that DR has no rights in the foregoing except for
encryption software supplied by DR, if any, and those expressly granted by this
Agreement.
3. VENDOR'S GENERAL OBLIGATIONS
a. Vendor shall deliver the current version of the Product to DR immediately
following execution of this Agreement. Vendor will provide DR with: (i) copies
of the Software on master diskettes, (ii) Product specification information in a
single file, self extracting archive format, or in another mutually agreeable
computer readable form that can be reproduced by DR, (iii) Documentation in a
computer readable form mutually agreeable to the parties that can be reproduced
by DR, and (iv) all the items and materials specified in the "Requirements
Checklist" on Exhibit A.
b. Vendor shall provide DR with computer readable copies and/or tangible
packaged Products containing all new releases, updates, or revisions of the
Software and Documentation within a reasonable time after each such release is
made generally available by Vendor. Vendor will notify DR of its plans for each
new release, update or revision of the Product within a reasonable period f time
prior to such release.
c. Vendor will provide a hypertext link to ▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ (or
equivalent) on Vendor's World Wide Web Home Page (the "Link") where Product may
be purchased by End-User from DR. Vendor agrees to prominently display the Link
and to use reasonable efforts to promote the Link on Vendor's World Wide Web
Home Page. Vendor agrees that no other hypertext link for sale of the Products
will be placed on the Vendor's World Wide Web Home Page or elsewhere on Vendor's
Websites without the prior written consent of DR.
d. If Vendor makes any modifications, updates, or enhancements (the
"Improvements") to the Product, Vendor will offer the Improvements for
distribution by DR on terms substantially equivalent to those provided in this
Agreement. In the event that Vendor develops or acquires any new products,
Vendor agrees to give DR the right of first refusal for distribution of these
products on Vendor's World Wide Web Home Page and as provided for the Products
in this Agreement.
e. Vendor will furnish a ▇▇▇▇ in computer readable form to DR which is to be
included with each copy of the product sold by Dr hereunder. Vendor's linking
of its World Wide Web Home Page to ▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ (or equivalent) shall
constitute approval of the ▇▇▇▇ DR is delivering as part of the Product.
f. Vendor will provide all support and be fully responsible for all warranty
obligations relating to the product. Such support and warranty shall be
provided in accordance with Vendor's then-current published software support
policy, or, in the absence of such a policy in a reasonable manner.
g. Vendor will provide DR, without charge, such technical information,
current maintenance documentation, and telephone assistance as is necessary to
enable DR to effectively reproduce, electronically package, and distribute the
Products by any means outlined herein.
4. WARRANTIES
a. Vendor represents that it has the right and authority to enter into this
Agreement and to grant DR the rights to the Software and Documentation granted
in this Agreement.
b. Vendor warrants to DR that the Vendor has all rights, title, and interest
in the Product or has obtained the right to grant the licenses set forth in this
Agreement. As of the execution date of this Agreement, Vendor represents that
to the best of Vendor's knowledge the Product does not infringe upon or
misappropriate the proprietary rights of any third party.
c. DR represents that it has the right and authority to enter into this
Agreement.
d. DR represents and warrants that it will use its best efforts to
accurately replicate the Product.
e. DR represents and warrants that except for encryption software, if any,
supplied by DR, all Products distributed by DR will not be altered in any way.
5. PAYMENTS
a. Vendor agrees to pay DR the Initialization Fee specified on exhibit B.
Vendor agrees to allow DR to offset the unpaid Initialization Fee against any or
all other amounts owing to Vendor by DR under this agreement. If the net sales
from Vendor's World Wide Web Home Page through DR exceed $1,000.00 in the first
complete calendar month of operation, then DR will waive the Initialization fee.
Products available from Vendor will be installed on DR's server upon fulfillment
of other obligations pursuant to this Agreement. The Initialization Fee
includes normal price changes and version updates. All programming and other
changes made after initial site setup excluding normal price changes and version
updates will be charged to Vendor at $100.00 per hour ("Site Maintenance").
Vendor agrees to pay the billed Site Maintenance charges within 30 days from the
date of billing. In the event that Site maintenance is not paid for within 30
days of billing, Vendor agrees to allow DR to offset the unpaid Site Maintenance
against any or all other amounts owing to Vendor by DR under this Agreement.
b. For each copy of a Product sold and delivered to an End user DR will
purchase the Product from Vendor as follows:
1. For each copy of a Product sold and delivered to an End User generated of
Vendor's web site, DR will purchase the Product at a cost equal to the percent
of the selling price outlined on exhibit B (the "% Cost"). Example: if the
selling price of a Product is $100 and the % Cost on Exhibit B is 80% then DR
will purchase each copy of such Product sold at $80.
2. For each copy of a Product sold and delivered to an End User, generated
other than from Vendor's web site, DR will purchase the Product at a cost equal
to the cost outlined as the Distribution Cost on Exhibit B. Vendor agrees not
to sell the Product to any others for less than the Distribution Cost outlined
on Exhibit B. Vendor agrees to notify DR promptly of any reductions in the
Distribution Cost.
3. For purposes of this Agreement the combination of the % Cost and
Distribution Cost outlined in 5b.1. and 5b.2. shall be referred to as the "Total
Purchase Price".
c. No Total Purchase Price shall be due for copies of the Product returned
to DR for refund in accordance with the ▇▇▇▇ and accompanied by an executed
letter of destruction from the End-User, or because of defects or errors,
regardless of source. No Total Purchase Price shall be due in the case of
credit card chargebacks, unauthorized returns, or credit card fraud. DR will
use reasonable efforts to prevent such events and to recover funds in the case
of fraud.
d. Within thirty (30) days after the end of each month, DR will remit
payment to Vendor of the Total Purchase Price due for the immediately preceding
month. DR will provide Vendor with a report (the "Report"), specifying the
number of copies of the Product that DR has shipped, or has requested the Vendor
to ship, as applicable, during the immediately preceding month and the
calculation of the Total Purchase Price due to Vendor in connection therewith.
e. DR will provide to Vendor within thirty (30) days after the end of each
month, a report for the immediately preceding month showing the name, address,
phone number, e-mail address and certain other customer data along with the
quantity of the Product purchased by each End User that purchased the Product
from DR.
f. DR agrees to maintain adequate books and records relating to the
distribution of the Product to End Users and Dealers. Such books and records
shall be available at the principal office of DR for inspection by Vendor or its
representative during normal business hours, for the purpose of determining the
accuracy of the Total Purchase Price paid to Vendor for the 12 months
immediately preceding the start of the audit, in accordance with the terms of
this Agreement. Vendor shall have the right to conduct such an audit upon
twenty (20) days advance written notice not more than twice each year. In the
event that such an audit discloses an underpayment of the Total Purchase Price
which is greater than five percent (5%), then DR shall pay the reasonable costs
of such audit, otherwise Vendor shall pay the costs of such audit.
g. Any payment or part of a payment hereunder, which is not paid when due
shall bear interest at the rate of 1.5% per month from its due date until paid.
h. In addition, Vendor and DR agree to the Marketing payments listed on
Exhibit B, if any.
6. TANGIBLE DELIVERY OF PRODUCTS
a. The following provisions will apply to any Products listed on Exhibit B
which are to be delivered in tangible form by DR:
1. The Vendor shall provide DR with an inventory of the Products to be held
on consignment and used by DR to fulfill orders for the Products. DR shall be
responsible for the delivery of the Products to the End User at a location or
locations designated by the End User.
2. The Products shall be delivered to DR prepackaged and ready for shipment
and delivery to the End User. The Vendor shall be solely responsible for the
shipment of the Products to DR and shall be solely responsible for all costs and
expenses associated with any such shipments. The Vendor shall bear the entire
risk of loss of or damage to the Products during shipments to or from DR.
3. Within fifteen (15) days after the date of this Agreement, the Vendor
shall provide DR with such consigned quantities of the Products as may be
mutually agreed upon in writing by DR and the Vendor. On a periodic basis, DR
shall provide an inventory detail to Vendor showing the current inventory of the
products. Periodically, DR will issue consignment purchase orders for the
estimated needs of Product to be physically shipped. The Vendor shall be
responsible for making prompt delivery of the Products to DR.
4. All shipments of Products to DR will be clearly labeled with DR's
purchase order number on the outside of the box. If DR is tracking aerial
numbers for the Products, Vendor will provide with each shipment of Product a
complete list of the serial numbers of the Product enclosed in each box.
5. DR shall have no liability of any kind whatsoever as a result of any
delay in the delivery of the Products by the Vendor, or the delivery of the
products to DR in non-conforming condition. Upon the termination of this
Agreement, at the Vendor's sole cost and expense, the unsold inventory of the
Products shall be returned to the Vendor.
7. CONFIDENTIALITY
a. Each party agrees that all binary code, inventions, algorithms, know-how,
ideas, and all other business, technical and financial information it obtains
from the other are the confidential property of the disclosing party
("Confidential Information"). Except as expressly and unambiguously allowed
herein, the receiving party will hold in confidence and not use or disclose any
Confidential Information and shall similarly bind its employees and agents. The
receiving party shall not be obligated under this Section 7 with respect to
information the receiving party can document:
1. is or has become readily available to the public through no fault of the
receiving party or its employees or agents; or
2. is received without restriction from a third party lawfully in possession
of such information and lawfully empowered to disclose such information; or
3. was rightfully in the possession of the receiving party without
restriction prior to its disclosure by the disclosing party;
4. is independently developed by the receiving party by its employees or
agents without access to the other party's similar Confidential Information.
Each party's obligations with respect to Confidential Information shall continue
for the shorter of three (3) years from the date of termination of this
Agreement or until one of the above enumerated conditions becomes applicable.
Each party acknowledges that its breach of this Section 7 would cause
irreparable injury to he other for which monetary damages are not an adequate
remedy. Accordingly, a party will be entitled to injunctive relief and other
equitable remedies in the event of a breach of the terms of this Agreement.
b. DR agrees not to: (i) disassemble, decompile or otherwise reverse
engineer the Software or otherwise attempt to learn the source code, structure,
algorithms or ideas underlying the Software; (ii) take any action contrary to
▇▇▇▇ except as allowed under this Agreement.
8. VENDOR TRADEMARKS
a. DR acknowledges that the Vendor Trademarks are trademarks owned or
licensed solely and exclusively by Vendor. DR agrees to use the Vendor
Trademarks only in the form and manner and with appropriate legends as
prescribed by Vendor. All use of Vendor Trademarks shall inure to the benefit
of Vendor.
b. DR shall not remove, alter, cover or obfuscate any copyright notice or
other proprietary rights notice placed in or on the Products by Vendor.
9. INDEMNIFICATION
a. Vendor shall defend, indemnify, and hold DR harmless from and against any
and all liabilities, losses, damages, costs, and expenses (including, without
limitation, reasonable legal fees and expenses) associated with or incurred as a
result of any claim, action, or proceeding instituted against DR arising out of
or relating to the acts or failure to act of the Vendor, or any of its
affiliated companies, agents, employees or other related parties under this
Agreement including, without limitation, actions, claims, or proceedings related
to: (i) Vendor's performance of its rights and obligations under this Agreement,
(ii) the breach by Vendor of any of the terms of this Agreement or any of the
representations and warranties contained herein; or (iii) the actual or alleged
infringement of any intellectual property rights arising out of Electronic
Distributor's duplication, sale, distribution, or other use of the product
pursuant to this Agreement.
10. LIMITATION OF LIABILITY
The total liability of DR (including its subcontractors and dealers) for all
claims, whether in contract, tort (including negligence and product liability)
or otherwise, arising out of, connected with, or resulting from the distribution
of the Product or any other terms of this agreement shall not exceed the net
amount realized by DR hereunder. IN NO EVENT SHALL DR BE LIABLE FOR ANY LOSS OF
DATA, LOST PROFITS, OR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR
EXEMPLARY DAMAGES, EVEN IF DR HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES AND NOTWITHSTANDING THE FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED
REMEDY PROVIDED HEREIN.
11. TERM AND TERMINATION
a. This Agreement will continue in effect for two (2) years from the date
hereof ("Initial Term"). This Agreement will be automatically renewed for
successive additional one (1) year terms ("Renewal Term") unless terminated by
either party upon ninety (90) days written notice prior to the expiration of the
Initial Term or any Renewal Term.
b. This Agreement may be terminated by a party "for cause" immediately by
written notice upon the occurrence of any of the following events: (i) If the
other party ceases to do business, or otherwise terminates its business
operations (except as permitted under Section 12.a.) or (ii) If the other shall
fail to promptly secure or renew any license registration, permit, authorization
or approval for the conduct of its business in the manner contemplated by this
Agreement or if any such license, registration, permit, authorization or
approval is revoked or suspended and not reinstated within thirty (30) days,
(iii) If the other materially breaches any provision of this Agreement and fails
to fully cure such breach within thirty (30) days of written notice describing
the breach; or (iv) If the other party becomes insolvent or seeks protection
under any bankruptcy laws, creditor's arrangement, composition or comparable
proceeding, or if any such proceeding is instituted against the other and not
dismissed within ninety (90) days.
c. Upon termination of this Agreement for any reason, DR will immediately
cease distribution of the Products. DR shall remit all Total Purchase prices
due to Vendor within sixty (60) days of such termination, less a reasonable
reserve for estimated returns.
d. Termination by either party will not affect the rights of any End User
under the terms of the ▇▇▇▇.
12. GENERAL PROVISIONS
a. This Agreement may not be assigned by Vendor or by operation of law to
any other person, persons, firms, or corporations without the express written
approval of DR. DR shall be entitled to assign this Agreement in the event of a
merger, acquisition, joint venture, or a sale of substantially all of its
assets, or any similar transaction.
b. All notices and demands hereunder shall be in writing and shall be served
by personal service or by mail at the address of the receiving party set forth
in this Agreement (or at such different address as may be designated by such
party by written notice to the other party). All notices and demands by mail
shall be certified or registered mail, return receipt requested, or by
nationally-recognized private express courier, and shall be deemed given upon
the earlier of; receipt or 5 days after mailing.
c. This Agreement shall be governed by and construed in accordance with
substantive laws of the State of Minnesota.
d. Each party is acting as an independent contractor and not as an agent,
partner, or joint venture with the other party for any purpose. Except as
provided in this Agreement, neither party shall have the right, power, or
authority to act or to create any obligation, express or implied, on behalf of
the other.
e. The indemnification and confidentiality obligations set forth in this
Agreement and any other provisions which by its sense and context is
appropriate, shall survive the termination of this Agreement by either party for
any reason.
f. The titles and headings of the various sections and paragraphs in this
Agreement are intended solely for convenience of reference and are not intended
for any other purpose whatsoever, or to explain, modify or place any
construction upon or on any of the provisions of this Agreement.
g. No provisions in either party's purchase orders, or in any other business
forms employed by either party will supersede the terms and conditions of this
Agreement, and no supplement, modification, or amendment of this Agreement shall
be binding, unless executed in writing by a duly authorized representative of
each party to this Agreement.
h. The parties have read this Agreement and agree to be bound by its terms,
and further agree that it constitutes the complete and entire agreement of the
parties and supersedes all previous communications, oral or written, and all
other communications between them relating to the license and to the subject
hereof. N representations or statements of any kind made by either party, which
are not expressly stated herein, shall be binding on such party.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set
forth above.
VENDOR
DIGITAL RIVER, INC. Company: PROMARK SOFTWARE INC.
Signature: Signature: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name & Title: Name & Title: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, PRESIDENT
Date: Date: May 27/98
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EXHIBIT LIST:
Schedule A: Requirements Checklist
Schedule B: Products and Fees
Schedule C: Product Information (15 descriptions)