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EXHIBIT 10.2
EQUIPMENT SUPPORT SUBCONTRACT
This Agreement, consisting of this Equipment Support Subcontract along with
Schedules A through G, is between OLIVETTI CANADA LIMITED ("OCL"), a Canadian
corporation, with corporate headquarters at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇. ▇., ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇▇ LIMITED, ("MAI"), a Canadian corporation,
with corporate headquarters at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, and is
effective on February 21, 1997 ("Effective Date").
1. PURPOSE
MAI sells computers and computer systems and provides service for the
equipment it sells to its customers. As part of that business, MAI
provides warranty service for many of the products it sells and has
also entered into contracts with many of its customers to provide
maintenance, repair, and related services for these products. In order
to provide these services, MAI employs a number of computer service
technicians working out of a number of field offices throughout Canada.
MAI is planning to discontinue its current field service operations and
needs a company with a qualified field service organization to perform
the field service portion of MAI's contracts with its customers. OCL is
also in the business of selling computers and computer systems and also
maintains a computer service field organization throughout Canada. OCL
has agreed to provide MAI with computer field service throughout Canada
under the terms and conditions set forth in this agreement.
2. APPLICATION OF AGREEMENT
This Agreement is intended to cover not only the provision of computer
field service operations under those contracts MAI has with its
customers as of the Effective Date of this Agreement ("Existing
Customer Agreements"), but contracts MAI enters into with its customers
after the Effective Date as well ("New Customer Agreements"). However,
the terms under which OCL will provide services related to Existing
Customer Agreements differ in some respects from those under which it
will provide services related to New Customer Agreements.
Schedules A through E define the services OCL will perform and the
manner in which MAI will support OCL and pay OCL for those services
with respect to New Customer Agreements. Schedule F identifies the ways
in which the treatment of these same issues will differ with respect to
Existing Customer Agreements.
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3. EXCLUSIVITY/RIGHT TO BID
This Agreement is intended to establish an exclusive relationship
whereby OCL will provide all of MAI's Maintenance Service needs (for
both Warranty Service and Contract Service) under Existing Customer
Agreements. MAI agrees to have OCL provide all its field service
requirements of this type under the Existing Customer Agreements and
that it will not perform those obligations itself or contract with any
other person or entity to provide such requirements so long as this
Agreement is in force.
MAI further agrees that with respect to all of its other Equipment
Support needs it may have during the term of this Agreement, it shall,
at a minimum, provide OCL with the opportunity to bid on the provision
of such services. MAI (or its affiliate MAI Systems Corporation)
further agrees to provide the use of office space and access to MAI's
existing office equipment (telephones, copiers, fax machine, etc.) for
OCL employee(s) to work at an MAI facility to serve as an account
contact and to respond to requests for bids from MAI. OCL agrees to
reimburse MAI for long distance telephone charges incurred by such
employee(s).
4. MAI EMPLOYEES
a. MAI shall terminate the employment of those MAI employees
identified by name and title on Schedule G (the "Target
Employees") effective February 20, 1997.
b. Prior to the Effective Date, OCL will offer employment to the
Target Employees on the following terms:
(1) a salary or hourly wage no less than that being paid
to the Target Employee by MAI,
(2) OCL's normal terms and conditions of employment for
similar employees,
(3) treatment of the Target Employees' credited years of
service with MAI (as shown on Schedule G) as service
with OCL,
(4) OCL agrees not to layoff any Target Employees
identified on Schedule G as managers during the
twelve (12) month period beginning on the Effective
Date. This shall not prohibit OCL from terminating
such employees for cause, and
(5) OCL's offer of employment to a Target Employee shall
be contingent on that Target Employee agreeing to
transfer his or her accrued vacation balance to OCL
instead of having the value of that balance paid in
cash by MAI upon termination of employment. MAI
agrees to reimburse OCL for
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the value of all vacation balances transferred to OCL
by Target Employees (the "Transferred Total"). This
reimbursement shall be made beginning March 1, 1997
in monthly payments equal to the greater of
(i)one-twelfth (1/12) of the Transferred Total or
(ii)the actual value of transferred vacation balances
taken by Target Employees in the prior month. MAI
agrees to indemnify OCL against any claims arising
from this provision on transferring vacation balances
in accordance with the provisions of Section 13(a) of
this Agreement.
c. The parties acknowledge that the success of this agreement is
partly dependent on most of the Target Employees agreeing to
go to work for OCL. Should either party feel that this
agreement will not be successful as a result of a significant
number of the Target Employees not accepting OCL's offered
employment (either because of the number of such non-accepting
Target Employees or their location or identity), then that
party shall be entitled to terminate this Agreement effective
as of the Effective Date by notice to the other party. Such
notice must be delivered no later than February 25, 1997 to be
effective.
In the event of termination as provided in this section, the
parties agree to cooperate to place both parties back in the
position each would have been in had the Agreement never gone
into effect, for example by transferring parts back to MAI and
working together to reinstate the Target Employees as MAI
employees. MAI shall be responsible for paying wages and
providing benefits during the time those Target Employees who
accepted employment with OCL were OCL employees and/or
reimbursing OCL for any such employment costs incurred by it
during this period, but shall have no other obligation to OCL
for its provision of Maintenance Service during this period.
d. The parties acknowledge that it is likely that if OCL needs to
incorporate more than twenty-seven and one-half (27 1/2)
Target Employees into OCL's current workforce, it may need to
layoff some number of Customer Service Engineers. If there are
more than twenty-seven and one-half (27 1/2) Target Employees
listed on Schedule G, MAI agrees to pay OCL Thirty Thousand
Dollars ($30,000) (CDN) for each Target Employee ($15,000 for
1/2 an employee) in excess of twenty-seven and one-half (27
1/2) to help offset the cost of these anticipated layoffs.
This amount shall be paid to OCL in twelve equal monthly
payments beginning on March 15, 1997.
e. In the event of a full or partial termination of this
Agreement by either party pursuant to the terms of this
Agreement for any reason at any time prior to the end of the
initial term of this Agreement, the parties agree as follows:
(1) OCL shall terminate the employment of as many of the
Target Employees as it deems appropriate in light of
the amount of business being lost by it as a result
of the full or partial termination of this Agreement.
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(2) MAI will offer employment to the Target Employees
being terminated by OCL on account of the full or
partial termination of this Agreement on the
following terms:
a) a salary or hourly wage no less than that
being paid to the Target Employee by OCL,
b) MAI's normal terms and conditions of
employment for similar employees,
c) treatment of the Target Employees' credited
years of service with OCL as service with
MAI.
(3) MAI shall, at its option, be entitled to solicit for
hire any Target Employees not being terminated by
OCL, without regard to the provisions of Section 14,
Non-Solicitation of Employees.
▇. ▇▇▇ has decided to retain its field service engineers in
British Columbia as its own employees rather than outsourcing
that part of its operation to OCL. However, as part of this
agreement OCL will manage the work and operations of those MAI
employees and provide them with parts and other support
necessary for them to operate efficiently. MAI will be
responsible for providing these employees with any necessary
equipment, facilities and tools and will be responsible for
the hiring, firing and discipline of these employees.
g. The provisions of this section are intended solely for the
benefit of MAI and OCL and are not intended to create or
expand any rights, as third party beneficiaries or otherwise,
of any other person, including without limitation any of MAI's
employees. Nothing in this section shall be deemed to create
any additional rights to severance compensation for the Target
Employees who accept employment with OCL.
5. SOFTWARE LICENSE
MAI either owns or has the right to license certain software (including
diagnostic programs) which is either necessary or desirable to use in
providing Equipment Support (the "Software"). Subject to the terms and
conditions of this Agreement MAI hereby grants to OCL a non-exclusive
license to access and use the Software as OCL determines appropriate in
performing its responsibilities under this Agreement and only under
this Agreement. OCL shall be permitted to make copies of the Software
as it deems appropriate for use in performing its obligations under
this Agreement.
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OCL acknowledges that the Software is licensed, not sold, to it solely
for the purpose of performing its obligations under this Agreement. OCL
further acknowledges that the Software is "Confidential" and subject to
the provisions of Section 16, Non-Disclosure, of this Agreement. OCL
acknowledges that it is not permitted, nor shall it permit anyone else,
under any circumstances, to decode, reverse engineer, decompile, or
disassemble the Software.
6. OCL RESPONSIBILITIES
During the term of this Agreement, OCL will:
a. provide Equipment Support in Canada in the manner identified
in Schedules A & F;
b. maintain sufficient fully trained, competent and qualified
maintenance personnel to perform the Equipment Support
required by this Agreement;
c. perform the obligations imposed on it with respect to Parts in
Schedules C & F, and
d. except as permitted by this Agreement not enter into direct
Contract Service or Equipment Support agreements with any MAI
End Users pertaining to equipment which is the subject of a
service agreement with MAI.
7. MAI RESPONSIBILITIES
During the term of this Agreement, MAI will:
a. order Equipment Support from OCL in the manner identified in
Schedules A & F;
b. pay for Equipment Support rendered by OCL in the manner
identified in Schedules B & F;
c. perform the obligations imposed on it with respect to Parts in
Schedule F; and
d. provide OCL with the Technical Support necessary to permit it
to provide Equipment Support as identified in Schedule D.
8. DEFINITIONS
For the purposes of this Agreement the following terms shall have the
following meanings:
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a. "Contract Service" means performing Maintenance Service
pursuant to a contract with the End User in which the End User
pays MAI for its agreement to provide such service.
b. "Equipment Support" means performing any one or more of the
following types of service on the Equipment:
(1) Maintenance Service, (which includes both Contract
Service and Warranty Service)
(2) Installation Service, or
(3) Time and Materials Service
as those terms are defined in the Schedules to this Agreement.
c. "Existing Customer Agreement" means a contract between MAI and
its customer which is in effect on the Effective Date of this
Agreement and also means any subsequent renewal of such an
Agreement on substantially the same terms and conditions as
are in effect on the Effective Date of this Agreement.
d. "Location" means a site where Equipment is installed.
e. "New Customer Agreement" means
(1) a contract between MAI and its customer which was not
in effect on the Effective Date of this Agreement, or
(2) an Existing Customer Agreement which is renewed after
the Effective Date of this Agreement on terms and
conditions substantially different than those in
effect on the Effective Date of this Agreement.
MAI and OCL may agree in writing to continue to treat an
Existing Customer Agreement which is renewed after the
Effective Date of this Agreement on terms and conditions
different than those in effect on the Effective Date of this
Agreement as an Existing Customer Agreement despite the
changes in terms and conditions.
f. "Parts" means any modules, subassemblies, boards, components
and related materials of an item or unit of the Equipment.
g. "Service City" means those cities in which OCL maintains a
service office. Schedule E lists OCL's present Service Cities.
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h. "Warranty Service" means performing Maintenance Service in
fulfillment of a warranty given to the End User in connection
with the purchase of the Equipment.
In addition, capitalized terms not defined in this section shall have
the meanings stated in the text of this Agreement.
9. TERM
This Agreement shall take effect on the Effective Date, regardless of
when it is signed. Unless sooner terminated in accordance with the
terms of this Agreement, this Agreement shall have an initial term of
five (5) years ("Initial Term") and shall automatically be extended for
successive one (1) year periods thereafter. Either party may terminate
this Agreement at the end of the Initial Term or at the end of any
subsequent annual renewal upon not less than one hundred eighty (180)
days prior written notice.
10. WARRANTY
OCL warrants that all Equipment Support provided by it pursuant to this
Agreement will be performed in a competent and workmanlike manner. This
warranty is in lieu of all warranties, express or implied, which may be
deemed applicable to the subject matter of this agreement including,
but not limited to, any implied warranties of merchantability and
fitness for a particular purpose.
11. LIMITATION OF LIABILITY
NEITHER PARTY SHALL BE ENTITLED TO RECOVER ANY OF THE FOLLOWING TYPES
OF DAMAGES FROM THE OTHER IN CONNECTION WITH ANY CLAIM RELATED TO THIS
AGREEMENT, REGARDLESS OF WHETHER THAT CLAIM IS BASED IN TORT, CONTRACT
OR OTHERWISE:
(1) THE LOSS OF OR THE COST OF RECONSTRUCTING DATA STORED ON DISK
FILES, TAPES, OR MEMORIES, EXCEPT AS PART OF A CLAIM FOR
INDEMNIFICATION PURSUANT TO SECTION 13, BELOW(1),
(2) LOSS OF GOODWILL,
(3) INCIDENTAL DAMAGES,
(4) CONSEQUENTIAL DAMAGES,
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(1) MAI agrees to continue to include a limitation of liability provision
substantially similar to Section 13 of its current Services Agreement form
contract (see Appendix F-2) in future services agreements with Customers.
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(5) PUNITIVE DAMAGES,
(6) ANY FORM OF INDIRECT DAMAGES OF ANY NATURE, OR
(7) DAMAGES FOR PERSONAL INJURY OR PROPERTY DAMAGE EXCEPT TO THE
EXTENT CAUSED BY THE NEGLIGENCE OF THAT PARTY OR ITS EMPLOYEE.
12. INDEMNIFICATION
a. MAI agrees to defend, indemnify and save OCL harmless from and
against any and all claims, suits, or proceedings brought
against it and in any way relating to either the allegedly
negligent or wrongful acts or omissions of MAI, or the
products sold by MAI covered by this Agreement and from the
costs, expenses and damages incurred by OCL in connection with
such claims, suits and proceedings. OCL agrees to promptly
notify MAI of any claim as to which indemnification is sought,
cooperate fully in the defense of such claim, and permit MAI
or its insurance carrier to control the defense and settlement
of such claim.
b. OCL agrees to defend, indemnify and save MAI harmless from and
against any and all claims, suits, or proceedings brought
against it and in any way relating to allegedly negligent or
wrongful acts or omissions of OCL, and from the costs,
expenses and damages incurred by MAI in connection with such
claims, suits and proceedings. MAI agrees to promptly notify
OCL of any claim as to which indemnification is sought,
cooperate fully in the defense of such claim, and permit OCL
or its insurance carrier to control the defense and settlement
of such claim.
13. INSURANCE
Each party represents and warrants to the other that it has and will
maintain liability insurance coverage throughout the Term of this
Agreement, in an amount appropriate in light of the potential liability
created by this Agreement.
14. NON-SOLICITATION OF EMPLOYEES
From the Effective Date until six (6) months after the termination of
this Agreement MAI shall not, directly or indirectly, hire or solicit
for hire any OCL employee connected with performance under this
Agreement without OCL's prior written approval. This section shall not
prevent MAI from soliciting or hiring any OCL employee after such
employee's employment with OCL has been ended through no involvement by
MAI. It is further agreed that the damages as a result of a breach of
this provision would be difficult to measure and that the amount of One
Hundred Thousand ($100,000.00) Dollars (CDN) is a good approximation of
the damages that would be caused by one violation of this
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provision and should be payable as liquidated damages in the event of a
breach of this provision.
This paragraph shall not apply to prevent MAI from hiring or attempting
to hire the Target Employees following a full or partial termination of
this Agreement by MAI pursuant to the terms of this Agreement.
15. NON-DISCLOSURE
a. Both parties agree that any information disclosed to it by the
other party in connection with this Agreement which has been
designated in writing as "Confidential" (including information
disclosed orally and identified in writing as "Confidential"
within ten (10) days after the initial oral disclosure) shall
be treated as such. Additionally, all information provided by
MAI to OCL in connection with requests for bids or proposals
for Equipment Support, including the identity of MAI's
customers and their service requirements, shall be deemed
"Confidential" whether or not it is so identified. Each agrees
that with respect to such information it will:
(1) not disclose such information to third parties
without the written consent of the other,
(2) use such information solely for the purposes of this
Agreement,
(3) treat such information of the other with a degree of
care which is reasonably calculated to protect such
information from disclosure (but in any event with at
least the same degree of care as it treats its own
confidential information),
(4) inform its employees, agents or authorized
representatives of the confidential or proprietary
nature of such information, and
(5) direct such persons to comply with the terms of this
Agreement.
Either party may bring an action in equity to foreclose
violations of this section through injunctive relief.
b. The following types of information shall not be considered
"Confidential" information subject to the restrictions of this
provision:
(1) Information in the possession of or known to the
receiving party on the date of receipt,
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(2) Information in the public domain at the time of its
disclosure or which enters the public domain after
such disclosure through no fault of the receiving
party,
(3) Information independently developed by the receiving
party, its employees, agents or representatives
without reference to the other party's confidential
information,
(4) Information made available to the receiving party,
its employees, agents or representatives by a third
party having a right to do so, or
(5) Information ordered disclosed pursuant to judicial or
other lawful governmental action, provided, that the
party receiving such request gives prompt written
notice of the request to the other party.
▇. ▇▇▇ acknowledges that OCL's business includes the design,
development and servicing of products for the computer-based
industry, and nothing in this Agreement shall preclude or in
any way impair OCL's engaging or continuing to engage in that
business.
d. The non-disclosure obligations imposed by this Agreement shall
continue in force for so long as the information is maintained
as confidential by the disclosing party and for a minimum
period of three (3) years from the date of first disclosure,
regardless of any termination of this Agreement.
16. RELATIONSHIP BETWEEN PARTIES
OCL shall perform its duties under this Agreement as an independent
contractor, and not as an agent or affiliate of MAI. In particular:
a. nothing contained in this Agreement shall be construed to
constitute OCL as a partner, employee or agent of MAI, nor
shall either have any authority to bind the other in any
respect it being intended that each shall remain an
independent contractor responsible for its own actions,
▇. ▇▇▇ shall exercise no control over the activities and
operations of OCL, each being recognized hereunder as an
independent contractor,
c. The relationship between OCL and MAI's customers shall be that
of a subcontractor; OCL is not assuming any of the Customer
Agreements and shall have no direct obligation to MAI's
customers.
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17. ASSIGNMENT
Neither party may assign any of its rights, interests or duties under
this Agreement without the prior written consent of the other party ,
which consent shall not be unreasonably withheld. In the event one
party seeks consent to an assignment and the other party withholds its
consent to that proposed assignment, the party seeking consent may
terminate this Agreement upon sixty (60) days notice to the other
party.
18. AUTHORIZED REPRESENTATIVES AND NOTICES
a. Each party shall at all times designate one representative who
shall be authorized to take any and all action and/or grant
any approvals required in the course of performance of this
Agreement. Such representative shall be fully authorized to
act for and bind such party including the approval of
amendments to this Agreement. Until written notice to the
contrary, the authorized representatives of the parties are as
follows:
FOR OCL: FOR MAI:
President Vice President, Customer Service
Olivetti Canada Limited MAI Canada Limited
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇. E. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
North York, Ontario
b. Any notice or other communication required or permitted under
this Agreement shall be in writing and shall be delivered in
person or sent by overnight commercial courier service with
receipt, addressed as set forth below:
IN THE CASE OF OCL: WITH A COPY TO:
Vice President General Counsel
Customer Service Legal Department
Olivetti Canada Limited Olivetti North America, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇. E. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
North York, Ontario
Notice shall be deemed given when received.
c. Either party may change the name or address to which notices
or other communications are to be sent by giving written
notice of such change to the other party.
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19. EXCUSED NON-PERFORMANCE
A delay in or failure of performance under this Agreement caused by
circumstances beyond the reasonable control of the party affected shall
be excused to the extent necessary, provided that the party affected
shall make reasonable efforts to remove or circumvent such
circumstances. Such excusing circumstances shall include (without
limitation): shortages of materials; acts of God; fire; flood; war;
embargo; labor trouble; failure or delay by suppliers; riots; and laws,
rules, regulations and orders of any governmental authority. If any
delay or inability to perform continues for more than sixty (60) days,
the non-affected party shall have the right to terminate the affected
portion of this Agreement upon seven (7) days Notice to the affected
party, or to suspend its obligations under the Agreement until such
time as the delay or inability to perform is corrected.
If any delay or inability to perform on the part of OCL continues for a
period greater than the period of excused non-performance permitted in
MAI's contract with one of more of its Customers, MAI shall have the
right to terminate the affected portion of this Agreement upon
twenty-four (24) hours Notice to OCL. MAI agrees to continue to include
an excused nonperformance provision substantially similar to the first
two sentences of Section 15 of its current Services Agreement form
contract (see Appendix F-2) in future services agreements with
Customers.
20. DEFAULT AND TERMINATION
a. If either party defaults in performance of any material
obligation under this Agreement, and such default is not cured
within sixty (60) days after receipt of Notice from the
non-defaulting party, the non-defaulting party shall have the
right to immediately terminate this Agreement by Notice to the
defaulting party.
▇. ▇▇▇ may terminate this Agreement, as it relates to an
individual MAI Customer, for default by OCL on less than sixty
days notice as follows:
(1) If OCL is in default under this Agreement MAI shall
escalate that problem within OCL's service
organization as necessary in order to have the
problem addressed. This escalation shall include,
when necessary, bringing the problem to the attention
of OCL's vice president of customer service.
(2) If, after OCL has been given a reasonable opportunity
under the circumstances to resolve the problem, MAI
believes that OCL is still in default under this
Agreement, MAI will give OCL Notice of the alleged
default.
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(3) If OCL has not cured the default within forty-eight
(48) hours of its receipt of Notice, MAI may
terminate this Agreement as to the MAI Customer to
whom the default relates.
c. Should MAI become more than forty-five (45) days delinquent in
its obligation to pay, OCL may suspend its performance
hereunder until MAI's account is brought current. If MAI's
account remains delinquent for a total period of sixty (60)
days, OCL shall have the option to terminate this Agreement
immediately by Notice to MAI.
d. Termination of this Agreement shall not affect any rights
existing as of the effective date of termination.
e. The rights and remedies provided in this Agreement are
cumulative and in addition to any other rights or remedies
available at law or in equity.
f. The provisions of Section 16 shall survive termination of this
Agreement.
21. CONFLICT RESOLUTION
MAI and OCL agree to meet and work together to find acceptable
solutions to any disputes between them related to this Agreement. If,
after thirty (30) days, they are unable to so resolve the dispute, the
dispute will be referred to MAI's President and the President or CEO of
OCL, or their designated representatives, who shall meet or talk within
fifteen (15) business days after Notice is received to resolve such
dispute. Notice of the invocation of this procedure shall be directed
to such officers and shall include a reference to this Section 16. If
the dispute is not resolved by this meeting, then it shall be resolved
by arbitration in accordance with Section 17. If a party fails to meet
with the other party upon request, the requesting party may either
obtain an order of a court of competent jurisdiction requiring the
non-complying party to meet and confer or proceed to arbitration in
accordance with Section 17.
22. ARBITRATION
All disputes relating to this Agreement shall be submitted to
arbitration in accordance with the commercial rules of the Arbitration
Act RSO, 1990. The decision of the arbitrators shall be final, binding,
and without appeal and may be enforced in any court having jurisdiction
over the relevant parties or their assets.
23. GENERAL
a. This Agreement shall be governed by the laws of the Province
of Ontario.
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b. This Agreement together with the attached Schedules,
constitutes the complete and final agreement between the
parties with respect to the subject matter of this Agreement.
This Agreement supersedes all prior discussions, agreements
and writings with respect thereto. No agreement purporting to
modify, add to, terminate, waive or change any term or
condition of this Agreement shall be binding unless it is in
writing and signed by authorized representatives of both
parties.
c. The organization of this Agreement and section headings are
for convenience only and shall not be used to construe or
interpret this Agreement.
d. No delay or failure of either party in exercising any right
hereunder, and no partial or single exercise thereof, shall be
deemed to constitute a waiver of such right or any other
rights hereunder.
e. If any provision or term of this Agreement shall be deemed or
construed to be invalid, illegal or unenforceable by a court
of competent jurisdiction, such determination shall in no way
affect the validity, legality, or enforceability of the
remaining portions of this Agreement.
f. Should legal action be required to enforce or interpret any of
the provisions of this agreement the prevailing party shall be
entitled to all costs incurred in connection with that action,
including a reasonable attorney's fee.
"OCL" "MAI"
OLIVETTI CANADA LTD. MAI CANADA LTD.
By: By:
--------------------------------- -------------------------------
Its: Its:
-------------------------------- -------------------------------
Dated: Dated:
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SCHEDULE A
NEW CUSTOMER AGREEMENTS EQUIPMENT SUPPORT
This Schedule sets out a beginning framework to define the manner in which
service will be ordered by MAI and provided by OCL for New Customer Agreements.
The parties anticipate that OCL will be submitting bids to MAI with respect to
most New Customer Agreements and that the provisions of this schedule may be
modified by the specific provisions of a bid provided by OCL. However, in the
absence of such changes specified in the OCL bid documents, OCL will be making
its bids on the basis of the provisions of this schedule. The parties also
anticipate that as they refine their relationship and the manner in which they
do business, they may decide to modify the provisions of this schedule and each
agrees to negotiate in good faith about any requests for changes made by the
other. Any agreed changes resulting from such negotiations will be reflected in
an amendment to this Agreement signed by both parties.
1. PLACING EQUIPMENT UNDER SERVICE
a. In order to initiate Equipment Support for a particular item
of Equipment MAI must prepare and submit a completed OCL
Maintenance Service Order ("MSO") to OCL and that MSO must be
accepted by OCL. The MSO must include such information about
the Equipment as is reasonably requested by OCL, including:
(1) the model, age and configuration of the Equipment,
(2) the Equipment Location,
(3) the name, address, and telephone number of the End
User,
(4) the identity of the End User contact person, and
(5) any applicable uplifts for Extended Maintenance
Service which apply to the Equipment, such as zone
uplifts, extended coverage hours uplifts and/or
response time uplifts.
b. Equipment Support will not begin for a particular item of
Equipment until OCL has received and accepted an MSO for that
item of Equipment. Following acceptance of an MSO, OCL will
label the Equipment with an ID tag. This ID number must be
used to identify the Equipment in all communications with OCL
about the Equipment.
c. All changes to the information provided to OCL about Equipment
under maintenance, such as a change in Equipment location,
must be documented by submission of a revised MSO.
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d. An MSO placing Equipment under service shall be valid until
discontinued in accordance with paragraph A7. Until OCL
receives an MSO discontinuing service the Equipment will be
kept under service and OCL will ▇▇▇▇ ▇▇▇ for that service.
Requests for service received when no valid MSO is in force
will be treated as requests for Time & Materials Service.
2. REQUESTS FOR SERVICE
a. MAI, or its designated representative, will receive all End
User requests for service or repair.
▇. ▇▇▇, or its designated representative, will, obtain as much
information as reasonably possible about the End User's
problem during its communications with the End User.
▇. ▇▇▇, or its designated representative, will obtain from the
End User the information necessary to determine whether the
Equipment is eligible for Maintenance Service and to permit
OCL to properly perform Equipment Support. This shall include,
without limitation, the model and age of the Equipment and the
configuration in which it is installed.
▇. ▇▇▇, or its designated representative, will contact OCL and
request Equipment Support for the End User's Equipment. This
request shall include all pertinent information MAI has about
the End User's Equipment and the problem being experienced, at
a minimum:
(1) the ID number for the Equipment, and
(2) the nature of the problem being experienced by the
End User,
3. MAINTENANCE SERVICE
a. Maintenance Service means service performed to correct
improper functioning of Equipment which occurs from normal
use, including making any necessary adjustments and/or
replacing defective assemblies or subassemblies.
b. Maintenance Service does not include:
(1) Service of equipment not specifically identified on
the MSO ordering the Maintenance Service, including
devices peripheral or connected to Equipment.
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(2) Electrical work external to the Equipment.
(3) Repair of damage or loss resulting from accident,
transportation, neglect, misuse or abuse, operator
error, failure of electrical power or air
conditioning or humidity control, or use for which
Equipment was not designed.
(4) Supplies or accessories, painting or refinishing
Equipment, furnishing material for Equipment, making
specification or field engineering changes,
performing services connected with relocation of
Equipment, or adding or moving accessories,
attachments or other devices.
(5) Software programming and software program
maintenance.
(6) Service which is impractical for OCL to render or
required because of any adjustment, repair,
maintenance, alteration, attachment, addition, or
connection to another machine or device.
(7) Service calls required as the result of modification,
work or service of the Equipment by non-OCL
personnel.
(8) Service of Equipment which, because of a safety
hazard, exposes OCL personnel to a risk of injury.
(9) Service in connection with the installation,
discontinuance or removal of Equipment.
(10) Installation of engineering changes, feature changes,
or safety changes.
c. Equipment shall be kept in or shall be restored to good
working order.
d. Maintenance Service will be performed in a prompt, courteous,
efficient and workmanlike manner.
e. Unless otherwise specified, Preventive Maintenance will be
performed on equipment only during a Maintenance Service call.
Preventive Maintenance includes general cleaning and
inspection, and any adjustments and/or lubrication as
specified by the Equipment manufacturer.
4. STANDARD MAINTENANCE SERVICE.
a. After receiving a Request for Service from MAI or its
designated representative, OCL will dispatch a properly
trained Customer Service Engineer (CSE) to the Equipment
Location along with such tools, parts and manuals as the CSE
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reasonably believes Will be required to repair the Equipment
based on the information provided to OCL by MAI. Upon arrival
the CSE will- diagnose the problem, if any, and perform the
Maintenance Service.
b. OCL will use all reasonable efforts to arrive at the Equipment
Location ready to complete the Maintenance Service within the
agreed upon response time for that Equipment.
c. Maintenance Service will be performed during the agreed upon
hours of service(2) and at the location agreed upon for that
Equipment.
5. INSTALLATION SERVICE
a. Installation Service shall consist of
(1) Any necessary unpacking of the Equipment;
(2) Connection of Equipment;
(3) Physical inspection of Equipment in place;
(4) Functional testing of Equipment according to
prescribed procedures for such Equipment;
(5) Resolution of normal installation problems; and
(6) notification to MAI and End User of unusual
installation problems (e.g., design or engineering
problems, transit damage, etc.). These problems must
be corrected before OCL will perform Maintenance
Service on this Equipment.
b. Installation Service does not include uncrating or major
movement of the Equipment.
c. OCL will use all reasonable efforts to provide Installation
Service in a timely manner, subject to the availability of
personnel and equipment, necessary travel time and other
factors affecting OCL's ability to provide this service.
----------------------
(2) Normal Service Hours are Monday through Friday, 8:00 a.m. to 5:00 p.m. local
time, excluding OCL observed holidays. Service started during Normal Service
Hours and completed within 1 hour after Normal Service Hours will be deemed
performed within Normal Service Hours.
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6. TIME AND MATERIALS SERVICE
a. OCL may, at its option and in its discretion, elect to accept
requests from MAI for service on a time and materials basis
("Time and Materials Service"). Such Service shall be on a
"best efforts" basis consistent with the availability and
location of trained personnel and Parts.
b. OCL will use all reasonable efforts to provide Time &
Materials Service in a timely manner, subject to the
availability of personnel and equipment, necessary travel time
and other factors affecting OCL's ability to provide this
service.
7. DISCONTINUANCE
MAI may discontinue Maintenance Service for any Equipment by sending
OCL a fully completed and properly signed MSO acceptable to OCL
identifying the Equipment to be discontinued. Such discontinuance shall
become effective thirty (30) days after it is received by OCL. Such
discontinuance shall be ineffective if any part of its purpose is to
allow the Maintenance Service to be performed by MAI or a third party.
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[**CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
DOCUMENT AND THE CONFIDENTIAL PORTIONS OF EXHIBIT 10.2 HAVE BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
SCHEDULE B
PRICES FOR NEW CUSTOMER AGREEMENTS
This Schedule sets out what will eventually become the standard pricing scheme
to be used by the parties when no other pricing arrangements are agreed upon for
a specific order. However, both parties recognize that the market for Equipment
Support services is very competitive and changes frequently. Accordingly, OCL
agrees that upon request by MAI it will re-evaluate the prices and pricing
methodology identified in this schedule to respond to competitive pressures or
to reflect appropriate volume discounts upon request by MAI. In addition, OCL
Will provide bids for major projects in accordance with Section 3 of this
Agreement. Any agreed changes resulting from this reevaluation and/or bidding
process will be reflected in a document signed by both parties which identifies
the Equipment to which such modified prices apply.
1. STANDARD MAINTENANCE SERVICE
MAI will pay OCL an Annual Maintenance Charge ("AMC") for each unit of
Equipment placed under Maintenance Service as payment for OCL's
agreement to provide Standard Maintenance Service for each such unit of
Equipment. The AMC for each model of Equipment staff be as identified
in any service order accepted by OCL or flat rate pricing schedule
subsequently provided to MAI by OCL.
2. TIME AND MATERIALS/INSTALLATION SERVICE
a. OCL will ▇▇▇▇ [**]for each hour of labor incurred during
Normal Service Hours and [**] for each hour of labor incurred
outside Normal Service Hours by a CSE in performing the
service.
b. Labor charges commence upon dispatch of the CSE to the End
User location and include travel to and from the site.
c. There is a minimum 1 hour charge per call and additional time
will be charged in increments of one-quarter (1/4) hour.
d. OCL will, upon request by MAI, provide flat rate installation
prices for items of Equipment identified by MAI.
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3. COMMERCIAL TRAVEL
a. When Commercial Travel is required to perform Time and
Materials and/or Installation Service and has been approved in
advance by MAI, MAI will be charged the actual, reasonable
cost of such travel. Commercial travel includes, but is not
limited to, such items as airfare, ferry and rental vehicles.
4. LODGING EXPENSES
a. If OCL determines that it is in the best interests of OCL and
MAI to have a CSE remain overnight at or near the Equipment
Location in connection with Time and Materials and/or
Installation Service and MAI has approved such expenses in
advance, MAI will be charged the actual, reasonable lodging
and meal expenses incurred.
5. INVOICING/PAYMENT
a. OCL will invoice MAI monthly for Equipment for which Contract
or Warranty Service has been ordered. These invoices will be
issued on approximately the fifteenth (15th) of the month for
which the invoice is being issued. For example, OCL will
invoice MAI on approximately October 15th for the October
Contract Service being provided by OCL.
OCL will invoice MAI monthly, in arrears, for all other
Equipment Support.
b. Invoices are due and payable upon receipt and will begin to
accrue interest at 1.25% per month from the date of the
invoice if not paid in full within 45 days of the date of the
invoice.
▇. ▇▇▇ will pay or reimburse OCL for any and all sales, use and
excise taxes, and other fees or charges levied or imposed by
any governmental agency or authority on or in connection with
or measured by the value of the Services provided by OCL under
this Agreement.
6. AMENDMENT
a. This Schedule may be amended by OCL upon Notice to MAI.
b. The Amended Schedule shall become effective on the Effective
Date stated in the Amended Schedule, but no sooner than 30
days after Notice is given to MAI.
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c. Price changes included in any Amended Schedule shall apply
only to Equipment Support requested after the Effective Date
of the Amended Schedule.
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SCHEDULE C
SPARE PARTS
1. OCL'S OBLIGATIONS
a. OCL shall, at its expense, establish and maintain an inventory
of a sufficient quantity of all the Parts necessary to perform
the Equipment Service called for by this Agreement in each
Service City open for Equipment Service.
b. At its option, OCL may elect to maintain an inventory of
certain Parts in a centered depot or depots for distribution
within OCL as required.
c. OCL shall keep records of its receipt, disbursement and use of
such Parts.
d. OCL shall take all steps necessary to ensure the availability
of sufficient Parts to satisfy its commitments with respect to
all Equipment Service to be performed by it under this
Agreement.
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SCHEDULE D
TECHNICAL SUPPORT
1. TRAINING
a. Because OCL will be hiring many of MAI's former service
engineers, the parties do not anticipate that any initial
training of OCL personnel will be required. Should training
subsequently be required as a result of adding new Equipment
to the Schedules to this Agreement the parties will at that
time determine who is required to provide such training. If no
agreement is reached on this issue, OCL shall not be required
to provide Equipment Support for such newly added Equipment.
▇. ▇▇▇ will, upon request from OCL and at no charge, provide OCL
with such technical consultation and assistance as is
appropriate to enable OCL to provide its service
representatives with such training as its deems appropriate.
This shall include, without limitation, providing OCL with a
copy of MAI's educational materials pertaining to the
Equipment and permitting OCL to make such use of those
materials as it deems appropriate for its internal use in
satisfying its commitment to provide Equipment Support under
this Agreement.
2. DOCUMENTATION
a. As soon as practicable after execution of this Agreement MAI
will provide OCL, at no charge, with one complete set of
documentation and diagnostics for each model of Equipment.
b. As soon as practicable after any Equipment is added to the
Appendix to Schedule A, MAI will provide OCL, at no charge,
with one complete set of documentation and diagnostics for
such additional Equipment.
c. As soon as practicable after updates or changes to the
documentation and diagnostics provided to OCL become
available, MAI will provide OCL with those updates and changes
at no charge.
d. OCL may copy, modify, and use any or all of the documentation
and diagnostics provided to it by MAI as it deems necessary
for its internal use, while retaining all MAI trademarks and
copyrights.
3. SECOND LEVEL SUPPORT
a. MAI will provide OCL with telephone technical support for
OCL's service representatives during MAI's normal technical
support hours at no charge to OCL.
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SCHEDULE E
SERVICE CITIES
ALBERTA
Calgary ONTARIO
Edmonton Hamilton
Lethbridge London
Ottawa
BRITISH COLUMBIA Toronto
Richmond Waterloo
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
MANITOBA QUEBEC
Winnipeg Chicoutimi
Montreal
NOVA SCOTIA Quebec City
Halifax Trois Rivieres
1. AMENDMENT
a. Service Cities may be deleted at OCL's discretion. OCL will
give Notice to MAI of the effective date of the Service City
deletion.
b. OCL will continue Equipment Support in locations previously
serviced by the closed Service City from an alternative
Service City of OCL's choice, at the rate in effect at the
time of closing, for a period of ninety (90) days. At the end
of the ninety (90) day period, MAI may continue Equipment
Support with OCL with a revised AMC or discontinue Equipment
Support with OCL in those cities.
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[**CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
DOCUMENT AND THE CONFIDENTIAL PORTIONS OF EXHIBIT 10.2 HAVE BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
SCHEDULE F
EXISTING CUSTOMER AGREEMENTS
1. STATEMENT OF INTENT
The general intent of the parties is to have OCL perform the service
which MAI is currently required to provide to MAI's customers under the
Existing Customer Agreements in return for [**] MAI is consigning its
current inventory of spare parts to OCL to permit it to perform that
service and MAI will be providing technical hardware and software
support to OCL as required to assist it in providing this service.
Initially, MAI will be handling the incoming call reception for all
Existing Customer Agreements, however the parties intend to begin
working to transfer this function for certain of the Existing Customer
Agreements (the "Legacy Agreements") to OCL as soon as this agreement
has been executed. Eventually, MAI may also like to transfer the
billing and collection functions for the Legacy Agreements to OCL if it
is practical and economical to do so. The remainder of this schedule is
intended to define the precise terms and conditions pursuant to which
this general intent will be carried out.
2. IDENTIFICATION OF CUSTOMERS
Attached as Appendix F-I is a list of those MAI customers for whom MAI
will retain the call reception, billing and collection functions
throughout the term of this Agreement (the "Open Customers"). All MAI
customers with Existing Customer Agreements who are not listed on
Appendix F-I are "Legacy Customers" for purposes of this Agreement.
3. EQUIPMENT SUPPORT
a. GENERALLY. With the exceptions listed below, OCL will perform
MAI's Equipment Support obligations under the Existing
Customer Agreements under the same terms and conditions as are
required of MAI under those agreements. This shall include
Contract Service, Installation Service, and Time and Materials
Service to the extent such types of service are covered by the
Existing Customer Agreements. Provision of a particular type
of service for an Existing MAI Customer which is not covered
by the Existing Customer Agreement for that customer shall be
considered the provision of service under a New Customer
Agreement for purposes of this Agreement.
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Prior to execution of this Agreement, MAI provided OCL with
the form customer agreements and sample customer agreements
which are attached as Appendix F-2. MAI represents and
warrants to OCL that its Equipment Support obligations under
the Existing Customer Agreements are not materially different
than those required under these form customer agreements and
sample customer agreements.
b. EXCEPTIONS. MAI shall continue to perform the following
Equipment Support Obligations under the Existing Customer
Agreements:
(1) MAI shall continue to receive incoming trouble calls
from its customers. MAI will screen these calls to
determine whether the problem is hardware or software
related. With respect to calls which MAI determines
are hardware related, MAI shall notify OCL's dispatch
center and provide it with the information MAI has
about the problem so that OCL may dispatch a service
technician to the customer site to resolve the
problem. Upon resolution of the problem, OCL shall
notify MAI of its resolution of the problem and
provide it with the information necessary to permit
MAI to close the can in its records. The parties
agree to work together to link their computer systems
so that this entire process may ordinarily be done
via computer without the need for telephone or other
alternate means of communication.
Immediately following execution of this Agreement the
parties agree to begin working together to transfer
responsibility for incoming trouble calls from Legacy
Customers to OCL. OCL will provide Legacy Customers
with a to free phone number to use to call OCL with
trouble calls to place requests for service. The
parties agree to cooperate to make this transition as
smooth and as customer friendly as reasonably
possible. Upon completion of this process, OCL shall
be completely responsible for the call tracking
process and shall cease providing MAI with call
closure information for the Legacy Customers. At that
time, OCL will begin to provide MAI with mutually
defined reports summarizing its handling of Legacy
Customer calls.
(2) MAI shall continue to invoice its customers pursuant
to the Existing Customer Agreements and be
responsible for the collection of those invoices from
its customers. As part of this function, MAI will
retain the authority to determine if and when service
to a particular customer should be terminated and it
win notify OCL of any such termination of service.
Until receipt of such notification from MAI, OCL
shall continue to provide service to customers as
required by that customer's Existing Customer
Agreement and shall be entitled to be paid by MAI for
such service as provided by this Agreement.
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Following execution of this Agreement the parties
agree to begin working together to determine if it is
practical and economical to transfer responsibility
for the billing of and collection from Legacy
Customers to OCL. Part of this process will be
negotiation of the amount MAI will pay OCL to assume
these functions if the parties decide to proceed with
a transfer of these functions to OCL.
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[**CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
DOCUMENT AND THE CONFIDENTIAL PORTIONS OF EXHIBIT 10.2 HAVE BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
4. TRANSITION
The parties agree to work together to make the transfer of the service
work for Existing Customers from MAI to OCL as smooth as possible. As
part of this transition, MAI will provide OCL with access to its
customer service database and work with OCL to transfer the information
in that database into OCL's customer service database so that it win be
in place and useable by OCL on the Effective Date of this Agreement.
5. PAYMENT
a. For OCL's provision of Equipment Support under an Existing
Customer Agreement MAI will pay [**] recognized by MAI for
financial accounting purposes in connection with the Equipment
Support being provided by OCL ("Revenue") less the burdened
employee cost and the necessary cost of providing facilities
related to the MAI field engineers in British Columbia [**].
The parties recognize that MAI may ▇▇▇▇ its customers in
advance for the Equipment Support being provided by OCL and
that it may recognize revenue incrementally as the support is
provided. Further, the parties recognize that MAI may
establish a reserve for non-payment which reserve shall be
consistent with GAAP accounting principles and shall be
consistent with MAI's past collection experience of its
Existing Customer Agreements.
▇. ▇▇▇ will pay OCL the payment required pursuant to subparagraph
(a), above, monthly in arrears on or before the fifteenth day
of each month. OCL will not invoice MAI for these amounts.
c. OCL will provide MAI with such information as is necessary for
MAI to ▇▇▇▇ its customers for nonrecurring Equipment Support
provided by OCL, such as Installation, Time and Materials, and
Warranty Service.
d. Both parties shall have the right to audit the billing and
collection being done by the other related to this Agreement
and each shall provide the other with full access to its
pertinent financial records for the purpose of such audits.
Such access shall be at a reasonable time agreed upon in
advance and shall include the right to make copies of material
records upon confirmation of materiality by the audited party.
All records produced and/or copied by the auditing party are
deemed Confidential and protected by the confidentiality
provisions of this Agreement. Any variations from previously
reported figures disclosed by such audits shall be settled
between the parties by payment within thirty (30) days of the
discovery of such variation.
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[**CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
DOCUMENT AND THE CONFIDENTIAL PORTIONS OF EXHIBIT 10.2 HAVE BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
6. REVENUE BASED PAYMENT ADJUSTMENT
a. ADJUSTMENT. MAI has represented to OCL that, as of the
Effective Date, the Existing Customer Agreements are
generating [**] The parties agree that if, during the initial
term of the Agreement the actual revenue generated by the
Existing Customer Agreements (the "Actual Revenue") during a
calendar quarter is less than the Target Revenue, OCL's
percentage of the revenue from the Existing Customer
Agreements shall be increased by [**] that the Actual Revenue
is less than the Target Revenue. Any partial calendar quarter
will be pro-rated accordingly.
For example, if the Actual Revenue during the first full
calendar quarter of this Agreement is [**] Revenue percentage
will be increased by [**] MAI will at that time pay OCL the
difference between the amount MAI has paid OCL on Existing
Customer Agreement revenue during that calendar quarter at the
[**] and what it would have paid at the [**].
b. IMPLEMENTATION. These changes in the revenue percentage, if
any, will be implemented by reviewing the Actual Revenue at
the end of each full calendar quarter during the contract term
and adjusting the percentage rate accordingly. This adjustment
will be retroactive to the beginning of that calendar quarter
and any payments required to effectuate that adjustment for
the calendar quarter just ended will be made within ten (10)
business days. OCL's percentage of revenue during the
following calendar quarter will be based on the adjusted
percentage rate, which will then be re-evaluated and adjusted
as necessary at the end of the following calendar quarter.
c. THIRD PARTY CONTRACTS. Revenue from MAI's agreements with the
following companies which have been assigned to OCL pursuant
to a separate document has not been included in the Target
Revenue and shall not be considered for the purposes of this
Section of this Agreement:
(1) Aegis Manufacturing Corporation
(2) AGFA Division, Bayer Corporation
(3) Logicsys Technologies, Inc.
(4) Northern Micro
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(5) Patriot Computer Corporation
(6) Renaissance Computer Solutions, Inc.
(7) Sidus Systems, Inc.
7. PARTS
a. MAI will consign to OCL its current inventory of Parts being
used by it to perform Equipment Support pursuant to Existing
Customer Agreements (the "Consigned Parts"). MAI represents
and warrants to OCL that this inventory of Consigned Parts is
adequate in size and mix to properly perform the Equipment
Support OCL will be providing for Existing Customers as of the
Effective Date of this Agreement.
b. OCL will be responsible for the physical transfer of the
Consigned Parts from MAI to OCL. MAI agrees to cooperate fully
with OCL in order to enable the smooth transfer of the
Consigned Parts. Within 90 days of the Effective Date, OCL
will perform a physical inventory of the Consigned Parts and
provide MAI with a written list of the Consigned Parts. OCL
will immediately perform a physical inventory of those
Consigned Parts, if any, which are not the property of MAI and
which have been consigned to it by a third party. This
physical inventory of third party owned Consigned Parts will
be binding on the parties for purposes of adjusting any
shortage of such parts with the third party owner.
c. OCL will be responsible for maintaining the Consigned Parts in
the general condition and quantities as they were received
from MAI. OCL shall keep the Consigned Parts in such a manner
so that they are separately identifiable from OCL owned Parts.
As the Consigned Parts are used by OCL to perform Equipment
Support, OCL shall replace them with the exchanged part from
the customer equipment, after first making any necessary
repairs to the exchanged part. Exchanged parts which are not
repairable shall be replaced by OCL. OCL will be
subcontracting the actual repair of the Consigned Parts to a
third party and MAI hereby consents to that subcontracting.
Amounts or types of Parts added to the Consigned Parts by OCL
shall be the property of OCL and shall not be delivered to MAI
upon termination of this Agreement.
Should it become impractical for OCL to obtain replacement
parts (either because they are not reasonably available or not
reasonably affordable) OCL shall not be required to replace
unrepairable portions of the Consigned Inventory and shall be
relieved of its obligation to provide Equipment Support to the
extent it is prevented from doing so by this inability to
obtain replacement parts.
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d. Upon termination of this Agreement, OCL will return the
Consigned Parts to MAI in the quantities and condition it
received them from MAI, ordinary wear and tear excepted.
e. OCL agrees that MAI may search all pertinent public records,
file financing statements, and take other necessary steps to
protect MAI's ownership of the Consigned Parts against claims
of creditors and carry out the purposes of this Agreement. OCL
agrees to promptly execute and deliver to MAI all financing
statements and other documents necessary to permit MAI to
carry out such steps and otherwise cooperate with MAI's
efforts to protect its ownership of the Consigned Parts.
8. TOOLS
a. MAI will loan to OCL its current inventory of tools (including
laptop computers and diagnostic software) being used by its
field engineer work force or repair center to perform
Equipment Support pursuant to Existing Customer Agreements
(the "Consigned Tools"). MAI represents and warrants to OCL
that this inventory of Consigned Tools is adequate in size and
mix to properly perform the Equipment Support OCL will be
providing for Existing Customers as of the Effective Date of
this Agreement. The Consigned Tools shall remain the property
of MAI. OCL win be responsible for maintaining the Consigned
Tools in the general condition as they were received from MAI,
ordinary wear and tear excepted.
b. OCL will be responsible for the physical transfer of the
Consigned Tools from MAI to OCL. MAI agrees to cooperate fully
with OCL in order to enable the smooth transfer of the
Consigned Tools. Within 90 days of the Effective Date, OCL
will perform a physical inventory of the Consigned Tools and
provide MAI with a written list of the Consigned Tools.
c. OCL shall keep the Consigned Tools in such a manner so that
they are separately identifiable from OCL owned tools. Upon
termination of this Agreement OCL will return the Consigned
Tools to MAI in the condition it received them from MAI,
ordinary wear and tear excepted.
d. OCL agrees that MAI may search all pertinent public records,
file financing statements, and take other necessary steps to
protect NW's ownership of the Consigned Tools against claims
of creditors and carry out the purposes of this Agreement. OCL
agrees to promptly execute and deliver to MAI all financing
statements and other documents necessary to permit MAI to
carry out such steps and otherwise cooperate with MAI's
efforts to protect its ownership of the Consigned Tools.
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[**CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
DOCUMENT AND THE CONFIDENTIAL PORTIONS OF EXHIBIT 10.2 HAVE BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
9. WARRANTY SERVICE
a. OCL will provide Warranty Service under warranty obligations
in place on the Effective Date of this Agreement in accordance
with those warranties and will seek reimbursement from the
warranty provider in accordance with its usual terms. Where
the warranty provider is MAI, MAI will reimburse OCL on a Time
and Materials basis at the reduced rates of [**] outside
Normal Service Hours.
10. NEW BUSINESS DEVELOPMENT
a. EXISTING CUSTOMERS. Except for those Existing Customers with
whom OCL or its corporate affiliates has a pre-existing
relationship as of the Effective Date of this Agreement OCL
shall not solicit or contract with Existing Customers for any
products or services without MAI's express written consent.
Except as expressly prohibited by this provision, OCL shall not
be limited in its ability to conduct it business as if it had
not entered into this Agreement with MAI.
MAI agrees not to unreasonably withhold or delay its consent to
requests from OCL to solicit or contract with Existing
Customers for the sale of products or services which are not
competitive with a product or service sold by MAI. In granting
its consent, MAI shall be entitled to place reasonable
restrictions on the manner in which OCL interacts with the
Existing Customers, for example by precluding the involvement
of the OCL employees who provide Equipment Support for that
Existing Customer pursuant to this Agreement. In the event MAI
withholds its consent to a request by OCL to solicit or
contract with an Existing Customer, OCL shall be entitled to
terminate this Agreement upon one hundred eighty (180) days
prior written notice to MAI without further liability or
obligation to MAI. OCL's failure to exercise this right to
terminate on one or more occasions when it has the opportunity
to do so shall not be deemed to constitute a waiver of such
right or any other rights hereunder
▇. ▇▇▇ NON-SERVICE CUSTOMERS. There are persons using MAI
hardware and software who, as of the Effective Date, do not
have an existing agreement with MAI for Equipment Support
("MAI Non-Service Customers"). OCL is free to solicit
contracts with MAI Non-Service Customers (except those who MAI
is prohibited from soliciting pursuant to its July 21, 1993
agreement with Banwell) for any types of products or services,
including contracts for all types of Equipment Support.
Contracts for Equipment Support with MAI Non-Service Customers
shall be entered into between the customer and MAI, on terms
-33-
34
negotiated by OCL, and shall be treated as Existing Customer
Agreements for purposes of this Agreement.
[**CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
DOCUMENT AND THE CONFIDENTIAL PORTIONS OF EXHIBIT 10.2 HAVE BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
MAI agrees to reimburse OCL for [**] of the sales costs
(including the sales commission) it incurs in connection with
obtaining a Contract for Equipment Support with an MAI
Non-Service Customer.
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35
APPENDIX F-1
IDENTIFICATION OF CUSTOMERS
ATTACHED
-35-
36
APPENDIX F-2
SAMPLE CUSTOMER AGREEMENTS
ATTACHED
-36-
37
Page:
DEPOT AGREEMENT
Between Branch:
MAI CANADA, LTD Agreement:
And Date:
CUSTOMER:
BILLING ADDRESS:
CITY: PROVINCE: POSTAL CODE:
--------------------------------------------------------------------------------
1. TERMS OF AGREEMENT
This Agreement shall have an initial term of one (1) year from the
effective date specified in Schedule one (1) hereof and shall continue in full
force thereafter until terminated in the manner hereinafter provided. This
Agreement may be terminated during the initial term or at any time thereafter by
either party giving three (3) months' prior written notice of termination to the
other party. Any item of equipment may be withdrawn from this agreement by
either party upon three (3) months' prior written notice to the other party.
2. PAYMENTS AND CHARGES
The annual charges provided for in this Agreement commence on the
effective date stated in Schedule one (1) hereof and will be invoiced as of the
first of the month. Payment of each invoice shall be made in full within thirty
(30) days after the date of the invoice. If this agreement is effective with
respect to any item of equipment for less than a full calendar month, the charge
for each day for such item shall be computed at the a rate of 1/30th of the
monthly rate.
The annual charges set out in Schedule one (1) hereof are those currently
in effect and are subject to charge by MAI giving three (3) months' prior
written notice of such change to the Customer. If the annual charges are
increased, the Customer may, on the effective date of such increase, terminate
this agreement or withdraw from this agreement any item of equipment affected by
the increase by giving one (1) months' prior written notice of such termination
or withdraw to MAI.
There shall be added to the charges payable hereunder amounts equal to
any sales, use, excise or other taxes or duties, however designated, which are
levied or based on such charges or on this agreement on the services rendered or
parts supplied pursuant hereto and which are paid or payable by MAI, exclusive,
however, of taxes based on net income.
3. SCOPE OF SERVICE
The remedial services to be provided under this agreement consist of
warranty service and repair and parts service. MAI will not provide preventative
maintenance under this agreement. Parts will be furnished on an exchange basis
and the replaced parts will become the property of MAI. The remedial services
performed at the MAI Repair Depot referred to in Schedule one (1) hereof.
The Customer will determine when remedial services are required utilizing
procedures supplied by MAI, and will ship the equipment or machine part
requiring remedial services to the MAI Repair Depot. Upon its return from the
MAI Repair Depot, the Customer will install the equipment or machine part in its
operational location and check it s performance in the operational location.
Machine parts within each type of equipment will be specified by MAI.
Charges for shipping equipment and machine parts to the MAI Repair Depot
will be prepaid by the Customer, and the return shipping charges will be paid by
the Customer on a collect basis.
Except for any loss or damage caused by MAI's negligence, MAI shall have
no responsibility for any risk of loss or damage to any equipment or machine
parts while in transit or while in the possession of MAI at the MAI Repair
Depot.
4. EXCLUSIONS
The remedial services to be provided by MAI under this agreement do not
include programming services or the repair of damage or replacement of parts or
other service required by reason of:
- failure of the Customer to continually provide a suitable installation
environment as prescribed by MAI
- failure or inadequacy of electrical power, air conditioning, or humidity
control
- neglect, misuse, accident or disaster (including, without limitation, fire,
flood, and water) and other causes other than ordinary use
- alterations of equipment or the connection of equipment to a non-MAI machine
or device or
- the use of supplies.
The replacement of parts, such as cathode ray tubes is limited to "failure" of
such parts and does not include such occurrences as burnt phosphor of the CRT
screen.
5. OTHER SERVICES
At the Customer's request, services outside the scope of this agreement
will be furnished at MAI's applicable time and material rates in effect from
time to time.
6. INSTALLATION AND CONTROL OF ENGINEERING AND SAFETY CHANGES
MAI will control and install all engineering changes it deems necessary
on equipment covered by this agreement unless otherwise requested by the
Customer in writing. There will be no charge for such engineering changes.
MAI will control and install, without charge, all safety changes it deems
necessary. If the Customer refused to permit installation of safety change, or
removes once already installed, MAI may, if conditions warrant, discontinue
providing maintenance service until the hazard has been corrected.
7. LIMITATION OF LIABILITY
MAI shall not be in any way liable or responsible for any special,
incidental, or consequential losses or damages in any way arising from the
provision or the failure to provide any services to the equipment covered by
this agreement, or to the operating system or any application software, even if
MAI has been advised of the possibility of any such losses or damages, including
but not limited to loss of revenue, loss of profits, failure to realize savings
on any liability of the customer to another party, and in any event a liability
of MAI for losses or damages resulting from any cause whatsoever shall be
limited to an amount equal to the total annual charges payable hereunder.
8. GENERAL
The Customer represents that it is the owner of the equipment covered by
this agreement, or if not the owner, that it has the authority to enter into
this agreement.
Either party may terminate this agreement at any time for failure of the
other party to perform any of its obligations or agreements.
THIS AGREEMENT CONSTITUTES THE ENTIRE CONTRACT BETWEEN MAI AND THE
CUSTOMER WITH RESPECT TO THE SUBJECT MATTER HEREOF, AND THERE ARE NO
UNDERSTANDINGS, REPRESENTATIONS, CONDITIONS, GUARANTEES OR WARRANTIES EXPRESS OR
IMPLIED BY STATUTE, USAGE OR TRADE OR OTHERWISE, OTHER THAN AS SET FORTH HEREIN.
Any notice or other communication to be given hereunder shall be in
writing and mailed, if to MAI to the address of the MAI Repair Depot shown in
Schedule one (1) hereof, and if to the Customer to the address of the Customer
shown in Schedule one (1) hereof, or to such other address as such party shall
have therefore designated by notice in writing to the other party. Such notice
or communication shall be deemed delivered when sent postage prepaid (air mail
if mailed more than 200 miles from the place of delivery), registered mail,
return receipt requested.
This agreement will be governed by the laws of the province in which the
equipment covered by this agreement is located.
Signature
---------------------------------
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▇▇▇ ▇▇▇▇▇▇ LTD PAGE:
▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
ST-LAURENT (QC) BRANCH OFFICE:
▇▇▇ ▇▇▇ AGREEMENT:
ANNIVERSARY DATE:
DATE:
CUSTOMER NUMBER:
BILLING ADDRESS INSTALLATION ADDRESS
---------------------------------------------------------------------------------------------------------------------------
CUSTOMER NAME: CUSTOMER NAME:
---------------------------------------------------------------------------------------------------------------------------
ADDRESS: ADDRESS:
--------------------- ------------------ ----------------------- -------------------- --------------------- ---------------
CITY: PROVINCE: POSTAL CODE: CITY PROVINCE: POSTAL CODE:
--------------------- ------------------ ----------------------- -------------------- --------------------- ---------------
CONTACT: TELEPHONE NO.: CONTACT TELEPHONE NO.:
---------------------------------------------------------------------------------------------------------------------------
MAI BY ITS ACCEPTANCE HEREOF, AGREES TO PROVIDE ITS REMEDIAL AND PREVENTATIVE
MAINTENANCE SERVICES FOR THE EQUIPMENT AND FEATURES LISTED BELOW IN ACCORDANCE
WITH THE FOLLOWING TERMS.
PERIOD OF MAINTENANCE AVAILABILITY IS MONDAY TO FRIDAY, 8:30 A.M. TO 5:30 P.M.
MAINTENANCE SERVICE SELECTION: BILLING PERIOD:
----------------------------- --------------
ON SITE $ DEPOT AGREEMENT $ PARTS ONLY AGREEMENT $ ANNUALLY $ OTHER
-------
--------------------------------------------------------------------------------
FSM SERIAL MARKET EFFECTIVE WNT SERVICE
NUMBER NUMBER DESCRIPTION CODE DATE DAYS LEVEL
------ ------ ----------- ---- ---- ---- -----
ACCEPTED AND AGREED MAI CANADA, LTD. AGREED:
DATE: DATE:
---------------------------------------------- ---------------------------------------------------
BY: BY:
---------------------------------------------- ----------------------------------------------------
AUTHORIZED REPRESENTATIVE TITLE: AUTHORIZED REPRESENTATIVE TITLE:
------------------ -----------------------
REPRESENTATIVE NAME: REPRESENTATIVE NAME:
------------------------------ -----------------------------------
(PLEASE PRINT)
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39
Page: 1 OF 2
MAINTENANCE AGREEMENT
Between Branch:
MAI CANADA, LTD Agreement:
And Date:
CUSTOMER:
BILLING ADDRESS:
CITY: PROVINCE: POSTAL CODE:
--------------------------------------------------------------------------------
1. TERMS OF AGREEMENT
This Agreement shall have an initial term of one (1) year from the
effective date specified in Schedule one (1) hereof and shall continue in full
force thereafter until terminated in the manner hereinafter provided. This
Agreement may be terminated during the initial term or at any time thereafter by
either party giving three (3) months' prior written notice of termination to the
other party. Any item of equipment may be withdrawn from this agreement by
either party upon three (3) months' prior written notice to the other party.
2. ANNUAL CHARGES
The annual charges provided for in this agreement commence on the
effective date stated in the introduction hereof and will be invoiced as of the
first of the month. Payment shall be made in full within (3) days after the date
of invoice. If this agreement is effective with respect to any item of equipment
for less than a full calendar month, the charge for each day for such item shall
be computed at the rate of 1/30th of the monthly rate.
All charges specified are those currently in effect and are subject to
change upon three (3) months' prior written notice. If the charges are
increased, the Customer may, on the effective date of such increase, terminate
this agreement or withdraw from any service any item of equipment affected by
delivering one (1) months' prior written notice, otherwise, the new charges
shall become effective upon the date specified in the notice.
There shall be added to the charges payable hereunder amounts equal to
any sales, use, excise or other taxes or duties, however designated, which are
levied or based on such charges or on this agreement on the services rendered or
parts supplied pursuant hereto and which are paid or payable by MAI, exclusive,
however, of taxes based on net income.
3. SCOPE OF MAI'S MAINTENANCE SERVICE
MAI agrees to provide maintenance service during the periods selected by
the Customer to keep the equipment and features in good working order. This
includes:
(a) Scheduled preventative maintenance based upon the specific needs of the
individual machines as determined by MAI. Preventative maintenance includes
lubrication, necessary adjustments and replacement of unserviceable parts.
(b) Unscheduled, on call remedial maintenance, including replacement of
unserviceable parts. Parts will be furnished on an exchange basis and will be
new parts or parts equivalent in new performance when used in these machines.
Replaced parts become the property of MAI.
4. EXCLUSIONS
MAI's maintenance service provided hereunder does not include:
(a) Electrical work external to the machine.
(b) Repair or damage resulting from accident, transportation, neglect or misuse,
failure of electrical power, air conditioning or humidity control or causes
other than ordinary use.
(c) Furnishing platens, supplies or accessories, painting or refinishing the
machines or furnishing materials therefore making specification changes or
performing services connected with relocation of machines; or adding or
removing accessories, attachments or other devices.
(d) Furnishing of print heads, unless otherwise stated.
(e) Replacement of cathode ray tubes ("CRT's") for phosphur burn.
(f) Such service which is impractical for MAI Customer Engineers to render
because of alterations in the machines or their connection by mechanical or
electrical means to another machine or device.
(g) Programming or program maintenance.
(h) Network maintenance.
5. OTHER SERVICES
At the Customer's request, services outside the scope of this agreement
will be furnished at MAI's applicable time and material rates in effect.
6. ACCESS TO EQUIPMENT
(a) MAI shall have full and free access to the equipment to provide service
thereon and the customer shall provide a safe place in which to perform such
services. If persons other than MAI Customer Engineers shall repair, modify or
perform any maintenance on any equipment covered by this agreement and as a
result thereof further maintenance services by MAI is required to restore the
machine to good operating condition, such maintenance services will be made at
MAI's applicable time and material rates and terms then in effect.
(b) Customer shall be responsible for maintaining a procedure external t the
Product hardware for reconstruction of least or altered file, data or programs
to the extent deemed necessary by Customer, and for actual reconstruction of any
lost or altered files, data or programs.
7. EQUIPMENT CHANGES
If, with the consent of MAI, the Customer shall acquire any additional
equipment ("Additions"), discontinues the use of any equipment ("Deletions") or
replace any equipment with the same or a different type of equipment
("Changes"), MAI shall prepare and send to the Customer its standard form
Amendment to this agreement reflecting such Additions, Deletions and/or Changes
and stating the description including model and serial number, the effective
date and MAI's annual maintenance charge for the equipment involved in any such
Additions, Deletions or Changes. Any such Amendment shall not require execution
by the Customer and shall be binding on the Customer unless it gives notice of
objection in writing to MAI within thirty days after receipt of such Amendment.
Only the equipment and features described on the Maintenance Agreement
and as amended from time to time is covered. Substitutions by the original
equipment manufacturer and those authorized by MAI will be included in this
agreement without the need for an Amendment.
8. PERIODS OF MAINTENANCE SERVICE AVAILABILITY
The annual charges entitles the Customer to workday maintenance service
availability during any period of nine (9) consecutive hours between the hours
of 8:00 a.m. and 6:00 p.m. daily, as selected by the Customer, Monday through
Friday, except legal holidays. The hours of maintenance service availability for
a machine on Monday through Friday, except legal holidays, shall be the same on
each day.
9. TRAVEL EXPENSES
MAI will charge customers located beyond eighty (80) Km. From MAI's
designated servicing branch office or service point a Remote Incident Charge per
kilometer, measured in air kilometers. If the call necessitates an overnight
stay a per diem charge is payable. The Remote Incident Charge and the per diem
charge are charged at MAI's applicable rates then in effect.
10. MAINTENANCE SERVICES OUTSIDE SELECTED PERIODS
If the Customer requests unscheduled, on call remedial maintenance to be
performed at a time which is outside the selected periods of maintenance service
availability, the service will be furnished at MAI's standard hourly rates and
terms then in effect. Travel time and expenses are billable in connection with
such maintenance. There is a minimum charge of one hour including travel time
per MAI shift for calls taken within MAI's normal working hours, and two hours
including travel time, per MAI shift for calls taken outside of MAI's normal
working hours. For the purpose of this agreement, any request for unscheduled,
on-call remedial maintenance service received or started during the selected
periods of maintenance service availability and completed within one (1) hour
after such period will be treated as having been performed within such period
and no additional charges will be made therefor.
11. INSTALLATION AND CONTROL OF ENGINEERING AND SAFETY CHANGES
MAI will control and install all engineering changes it deems necessary
on equipment covered by this agreement unless otherwise requested by the
Customer in writing. There will be no charge for such engineering changes.
MAI will control and install, without charge, all safety changes it deems
necessary. If the Customer refused to permit installation of safety change, or
removes once already installed, MAI may, if conditions warrant, discontinue
providing maintenance service until the hazard has been corrected.
12. GENERAL
The Customer represents that it is the owner of the equipment covered by
this agreement, or if not the owner, that it has the authority to enter into
this agreement.
Either party may terminate this agreement at any time for failure of the
other party to perform any of its obligations or agreements.
Any notice or other communication to be given hereunder shall be in
writing and mailed, if to MAI to the address of the MAI Repair Depot shown in
Schedule one (1) hereof, and if to the Customer to the address of the Customer
shown in Schedule one (1) hereof, or to such other address as such party shall
have therefore designated by notice in writing to the other party. Such notice
or communication shall be deemed delivered when sent postage prepaid (air mail
if mailed more than 200 miles from the place of delivery), registered mail,
return receipt requested.
MAI shall not be in any way liable or responsible for any special,
incidental, or consequential losses or damages in any way arising from the
provision or the failure to provide any services to the equipment covered by
this agreement, or to the operating system or any application software, even if
MAI has been advised of the possibility of any such losses or damages, including
but not limited to loss of revenue, loss of profits, failure to realize savings
on any liability of the customer to another party, and in any event a liability
of MAI for losses or damages resulting from any cause whatsoever shall be
limited to an amount equal to the total annual charges payable hereunder.
THIS AGREEMENT CONSTITUTES THE ENTIRE CONTRACT BETWEEN MAI AND THE
CUSTOMER WITH RESPECT TO THE SUBJECT MATTER HEREOF, AND THERE ARE NO
UNDERSTANDINGS, REPRESENTATIONS, CONDITIONS, GUARANTEES OR WARRANTIES EXPRESS OR
IMPLIED BY STATUTE, USAGE OR TRADE OR OTHERWISE, OTHER THAN AS SET FORTH HEREIN.
No provision of this agreement shall be deemed, waived, amended, or modified by
either party unless such waiver, amendment or modification be in writing signed
by the party against whom it is sought to enforce the waiver, amendment or
modification, and the terms and conditions hereof shall prevail notwithstanding
any variance with the terms and conditions of any order submitted by the
Customer for the repair or maintenance of the equipment.
This agreement will be governed by the laws of the province in which the
equipment is to be installed by MAI.
Signature
---------------------------------
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▇▇▇ ▇▇▇▇▇▇ LTD PAGE: 2 OF 2
6700 COTE ▇▇ ▇▇▇▇▇▇, SUIT 103
ST-LAURENT (QC) BRANCH OFFICE:
▇▇▇ ▇▇▇ AGREEMENT:
ANNIVERSARY DATE:
DATE:
CUSTOMER NUMBER:
BILLING ADDRESS INSTALLATION ADDRESS
----------------------------------------------------------------------------------------------------------------------------
CUSTOMER NAME: CUSTOMER NAME:
----------------------------------------------------------------------------------------------------------------------------
ADDRESS: ADDRESS:
----------------------------------------------------------------------------------------------------------------------------
CITY: PROVINCE: POSTAL CODE: CITY PROVINCE: POSTAL CODE:
----------------------------------------------------------------------------------------------------------------------------
CONTACT: TELEPHONE NO.: CONTACT TELEPHONE NO.:
----------------------------------------------------------------------------------------------------------------------------
MAIL BY ITS ACCEPTANCE HEREOF, AGREES TO PROVIDE ITS REMEDIAL AND PREVENTATIVE
MAINTENANCE SERVICES FOR THE EQUIPMENT AND FEATURES LISTED BELOW IN ACCORDANCE
WITH THE FOLLOWING TERMS. PERIOD OF MAINTENANCE AVAILABILITY IS MONDAY TO
FRIDAY, 8:30 A.M. TO 5:30 P.M.
MAINTENANCE SERVICE SELECTION: BILLING PERIOD:
----------------------------- --------------
ON SITE $ DEPOT AGREEMENT $ PARTS ONLY AGREEMENT $ ANNUALLY $ OTHER______
--------------------------------------------------------------------------------
FSM SERIAL MARKET EFFECTIVE WNT SERVICE
NUMBER NUMBER DESCRIPTION CODE DATE DAYS LEVEL
------ ------ ----------- ---- ---- ---- -----
*** BILLING WILL COMMENCE AT THE END OF THE WARRANTY PERIOD, WHICH IS
CALCULATES AS EFFECTIVE DATE + WARRANTY DAYS ***
TOTAL MONTHLY CHARGE:
ACCEPTED AND AGREED MAI CANADA, LTD. AGREED:
DATE: DATE:
------------------------------------------------- ---------------------------------------------------
BY: BY:
------------------------------------------------- ---------------------------------------------------
AUTHORIZED REPRESENTATIVE TITLE: AUTHORIZED REPRESENTATIVE TITLE:
----------------------- ------------------------
REPRESENTATIVE NAME: REPRESENTATIVE NAME:
--------------------------------- -----------------------------------
(PLEASE PRINT)
-40-
41
Page: 1 OF 2
PARTS ONLY AGREEMENT
Between Branch:
MAI CANADA, LTD Agreement:
And Date:
CUSTOMER:
BILLING ADDRESS:
CITY: PROVINCE: POSTAL CODE:
--------------------------------------------------------------------------------
I. SCOPE OF AGREEMENT
a) Subject tot he terms of this Agreement, by its acceptance hereof, MAI
CANADA LTD, ("MAI") agrees to provide the customer specified n Schedule
one (1) hereof (the "Customer") with replacement parts for the u nit or
units of equipment specified in Schedule one (1) of this Agreement (the
"Equipment"). Such parts will be furnished on a replacement basis and
will be new parts or parts equivalent to new in performance when used
in or on the Equipment. Replaced parts shall become the property of
MAI. MAI agrees to provide replacement parts for the Equipment for the
charges set out in Schedule one (1) of this Agreement ( the "Annual
Charges) and subject to the terms of paragraph 3 hereof.
b) The Customer acknowledges and agrees that it is a condition of MAI's
obligations hereunder that maintenance services in respect of the
Equipment will be performed or furnished exclusively by MAI and further
agrees that the Equipment will not be worked on by anyone other than an
MAI representative or employee. All such maintenance service, excluding
the supply of replacement parts provided for above, shall be provided
or furnished at MAI's applicable hourly maintenance and repair charge
or rate and on terms then and from time to time in effect and only upon
request by the Customer.
c) If the Equipment is serviced or worked on by anyone other than an MAI
representative or employee, then in such event MAI's obligations under
this Agreement shall, at its option excersiable by notice to the
Customer, be immediately terminated.
2. TERMS OF AGREEMENT
This Agreement shall have an initial term of one (1) year from the
effective date specified on Schedule one (1) hereof, (the "Effective
Date"). This Agreement may be terminated by either party giving three (3)
months' prior written notice to that effect to the other.
3. ANNUAL CHARGES
a) The Annual Charges provided for in this Agreement commence on the
Effective Date. Each year during the term of this Agreement, the
Customer will be invoiced for one (1) year in advance, as of the
Effective Date. Payment in full shall be made within thirty (30) days
of the date of such invoice.
b) If this Agreement is effective for less than a full year, the Annual
Charges shall be pro rated by MAI for the period of this Agreement was
in effect and the balance, if any of pre-paid Annual Charges shall be
refunded to the Customer.
c) All Annual Charges specified are those currently in effect and are
subject to change upon three (3) months' prior written notice by MAI.
If the Annual Charges are changed, the new charges shall become
effective upon the date specified in such notice.
d) There shall be added to the Annual Charges due hereunder amounts equal
to any taxes, however, designated, levied or based on such charges,
this Agreement or the goods or services provided hereunder, including
any federal, provincial or municipal taxes or other amounts due or
payable by MAI in respect of the foregoing, exclusive however, of taxes
based on the net income of MAI.
4. EXCLUSIONS
MAI's obligations under this Agreement does not include:
a) Maintenance service required to keep the Equipment in good working
order.
b) Replacement of parts made necessary as a result of:
- accident, neglect or misuse to or of the Equipment,
- the attachment of equipment, parts or devices not approved by MAI, to
the Equipment,
- any mechanical or electrical alterations to the Equipment not
approved by MAI,
- any other cause other than ordinary use.
c) Replacement of cathode ray tubes ("CRT's") for phosphor burn.
5. ENGINEERING AND SAFETY CHANGES
MAI will control and install all engineering and safety changes it deems
necessary on the parts covered by this Agreement unless otherwise requested
by the Customer in writing.
6. GENERAL
a) The Customer represents that it is the owner of the Equipment or, if
not the owner, that it has the authority to enter into this Agreement.
b) Either party may terminate this agreement at any time, by notice to
that effect to the other, for the failure of the other to comply with
any of the terms and conditions hereof.
c) Any notice or other communication to be given hereunder shall be in
writing and mailed, if to MAI to the address of the MAI's branch office
shown in Schedule one (1) and, if to the Customer, to the address shown
in Schedule one (1), or to such other address as such party shall have
therefore designated by notice in writing to the other party. Such
notice or communication shall be deemed delivered ten (10) days after
having been sent postage prepaid, registered and return receipt
requested.
d) The Customer agrees that MAI shall not be in any way liable or
responsible for any special, incidental, or consequential losses or
damages in any way arising from the provision or the failure to provide
any services to the equipment covered by this Agreement, or to the
operating system or any application software, even if MAI has been
advised of the possibility of any such losses or damages, including but
not limited to loss of revenue, loss of profits, failure to realize
savings on any liability of the customer to another party, and in any
event a liability of MAI for losses or damages resulting from any cause
whatsoever shall be limited to an amount equal to the total annual
charges payable hereunder for one (1) year.
e) THIS AGREEMENT CONSTITUTES THE ENTIRE CONTRACT BETWEEN MAI AND THE
CUSTOMER WITH RESPECT TO THE SUBJECT MATTER HEREOF, AND THERE ARE NO
UNDERSTANDINGS, REPRESENTATIONS, CONDITIONS, GUARANTEES OR WARRANTIES
EXPRESS OR IMPLIED BY STATUTE, USAGE OR TRADE OR OTHERWISE, OTHER THAN
AS SET FORTH HEREIN. No provision of this Agreement shall be deemed,
waived, amended, or modified by either party unless such waiver,
amendment or modification be in writing signed by the party against
whom it is sought to enforce the waiver, amendment or modification, and
the terms and conditions hereof shall prevail notwithstanding any
variance with the terms and conditions of any order submitted by the
Customer for the repair or maintenance of the Equipment.
f) This Agreement will be governed by the laws of the Province in which
the Equipment is installed.
g) In this Agreement the masculine shall include the feminine and neuter
and the singular shall include the plural and vice versa or as the
context otherwise requires.
Signature
------------------------------------
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▇▇▇▇▇▇▇▇ ▇
▇▇▇ ▇▇▇▇▇▇ LTD PAGE: 2 OF 2
6700 COTE ▇▇ ▇▇▇▇▇▇, SUITE 103
ST-LAURENT (QC) BRANCH OFFICE:
▇▇▇ ▇▇▇ AGREEMENT:
ANNIVERSARY DATE:
DATE:
CUSTOMER NUMBER:
BILLING ADDRESS INSTALLATION ADDRESS
---------------------------------------------------------------- -----------------------------------------------------------------
CUSTOMER NAME: CUSTOMER NAME:
---------------------------------------------------------------- -----------------------------------------------------------------
ADDRESS: ADDRESS:
--------------------- ------------------ ----------------------- -------------------- --------------------- ----------------------
CITY: PROVINCE: POSTAL CODE: CITY PROVINCE: POSTAL CODE:
--------------------- ------------------ ----------------------- -------------------- --------------------- ----------------------
CONTACT: TELEPHONE NO.: CONTACT TELEPHONE NO.:
--------------------- ------------------ ----------------------- -------------------- --------------------- ----------------------
MAIL BY ITS ACCEPTANCE HEREOF, AGREES TO PROVIDE ITS REMEDIAL AND PREVENTATIVE
MAINTENANCE SERVICES FOR THE EQUIPMENT AND FEATURES LISTED BELOW IN ACCORDANCE
WITH THE FOLLOWING TERMS. PERIOD OF MAINTENANCE AVAILABILITY IS MONDAY TO
FRIDAY, 8:30 A.M. TO 5:30 P.M.
MAINTENANCE SERVICE SELECTION: BILLING PERIOD:
----------------------------- --------------
ON SITE $ DEPOT AGREEMENT $ PARTS ONLY AGREEMENT $ ANNUALLY $ OTHER___________
------------------------------------------------------------------------------------------------------------------------------
FSM SERIAL MARKET EFFECTIVE WNT SERVICE
NUMBER NUMBER DESCRIPTION CODE DATE DAYS LEVEL
------ ------ ----------- ---- ---- ---- -----
ACCEPTED AND AGREED MAI CANADA, LTD. AGREED:
DATE: DATE:
-------------------------------------------------------- ----------------------------------------------------
BY: BY:
----------------------------------------------------------- ------------------------------------------------------
AUTHORIZED REPRESENTATIVE TITLE: AUTHORIZED REPRESENTATIVE TITLE:
------------------------------ ------------------------
REPRESENTATIVE NAME: REPRESENTATIVE NAME:
------------------------------------------ -------------------------------------
(PLEASE PRINT)
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43
SCHEDULE G
TARGET EMPLOYEES
ATTACHED
-43-