EXHIBIT 10.8
MEMORANDUM OF UNDERSTANDING
This Memorandum of Understanding between Electronic Data Systems
Corporation ("EDS") and Unigraphics Solutions Inc. ("USI") is dated and
effective as of January 1, 1998 (this "MOU"). The relationship between EDS and
General Motors Corporation and its subsidiaries, joint ventures and other
affiliates (collectively, "GM") includes the provision of Unigraphics software
products and services. With the creation of USI as a subsidiary of EDS, USI and
EDS want to facilitate a cooperative framework for EDS and USI each working with
GM. The goal is for EDS and USI (the "Parties") each to provide excellent
service to and grow its business relationship with GM, all in a cooperative and
coordinated manner.
This MOU sets forth the agreement between USI and EDS regarding the roles
and responsibilities of each in serving the GM customer.
1. EDS - USI RELATIONSHIP. USI will conduct business with EDS in a manner
substantially the same as with any other USI customer, subject to the terms of
this MOU. USI and EDS will work together as quickly as possible to establish a
process to be used in implementing an operating framework for themselves with
regard to GM so that lines of communication are established. In all situations
involving GM, the Executive in Charge (defined in numbered paragraph 4) for each
Party will promptly notify, update and coordinate GM business opportunities with
the Executive in Charge for the other Party. In order to facilitate
coordination to the benefit of the GM customer, the Executives in Charge will
provide one another weekly written updates as to any activity involving GM.
2. USI SOFTWARE PRODUCTS.
(a) As between EDS and USI, USI will own the software products provided by
USI to GM (each, a "USI Product").
(b) USI will manage all aspects of the USI Products, including but not
limited to the provision of enhancements and added functionality to USI
Products.
(c) It is in the interest of the Parties that USI Products will be sold to
GM as commercial, off-the-shelf application software. If GM requests provision
of USI Products which are specially developed or which are not part of USI's
standard commercial offerings, the Parties will work together to agree on the
terms and prices for such unique USI Products. Unless otherwise agreed to
between the Parties, such unique USI Products, enhancements, and/or derivative
works will be owned by USI.
3. USI STEERING COMMITTEE. The USI Steering Committee will oversee the
implementation of this MOU and the relationship between EDS and USI relative to
the GM customer. The USI Steering Committee will be composed of two senior USI
executives appointed by the president of USI and two senior EDS executives
appointed by the president of EDS.
4. EXECUTIVES IN CHARGE. Each Party will appoint an Executive in Charge with
responsibility for managing its relationship with GM and with the other Party.
The EDS and USI Executives in Charge will work cooperatively and will have
authority to resolve issues between USI and EDS with respect to GM. Each Party
may change its Executive in Charge by written notice to the other. If issues or
disputes between EDS and USI cannot be resolved between the Executives in
Charge, such disputes will be submitted to the USI Steering Committee for
resolution. If the USI Steering Committee is unable to resolve the dispute,
full authority for resolution will reside in the Presidents of the Parties.
5. MASTER SERVICE AGREEMENT BETWEEN GM AND EDS. The Master Service Agreement
between EDS and General Motors Corporation dated June 7, 1996 (the "MSA")
describes in Exhibit C thereto a scope of services which GM has agreed to obtain
from EDS ("MSA Services"). EDS and USI hereby acknowledge that EDS will
continue to contract with GM for MSA Services.
(a) When EDS requests in writing that USI perform MSA Services as a
subcontractor to EDS, USI will perform such services on behalf of EDS pursuant
to the terms of the MSA, except as may otherwise be agreed in writing by the
Parties. The details of those subcontracted activities (such as description of
services, timing and pricing) will be documented in a written agreement between
EDS and USI.
(b) USI will comply with and enjoy the benefit of all then-current terms
and conditions included in the MSA and then-current policies and interpretations
agreed to between GM and EDS in its performance of MSA Services, unless
otherwise agreed to between EDS and USI.
(c) The Unigraphics Software Corporate License Agreement between General
Motors Corporation and EDS, effective as of July 1, 1996 (the "UCL"), is a
current Service Agreement under the MSA. Under the UCL, EDS is obligated to
provide up to 10,000 "Concurrent Use Copies" (as defined in the UCL) of
"Unigraphics Software," a sub-set of the then-current commercial products
offered by the Unigraphics division of EDS. Exhibit A to the UCL sets forth a
list of the then-current Unigraphics commercial product offerings and identifies
by module name the maximum number of each Unigraphics Software module to be
provided under the UCL.
(i) EDS will retain management of the UCL and will be the contracting
party for any additional services under the UCL, unless otherwise agreed by
EDS and USI. Additional USI Product and service offerings to be provided
under the UCL will be defined, priced and packaged jointly by EDS and USI.
USI will perform UCL-related obligations and receive the ongoing services
revenues under the UCL to be identified by EDS and USI under separate
cover.
(ii) EDS will track novation agreements signed by GM Eligible
Subsidiaries (as defined in the UCL). Notwithstanding anything to the
contrary set forth in the Contribution, Assignment and Assumption Agreement
dated January 1, 1998 between EDS and USI, EDS will retain responsibility
for payment of all third party royalties with respect to Unigraphics
Software provided under the UCL.
(iii) EDS will identify by server, and retain for EDS' internal use
on the EDS GM account at no charge, all copies of USI Products previously
furnished to EDS and currently used by EDS. EDS will execute a USI
Software License Evaluation Agreement to govern such usage. EDS will
purchase any USI Products in addition to the USI Products covered above for
EDS' use on the GM account at the then current GM prices for licenses and
maintenance, or at prices as otherwise agreed to by EDS and USI.
6. SERVICES TO GM BY USI OR EDS OUTSIDE THE SCOPE OF THE MSA.
(a) EDS has numerous existing agreements within GM under which EDS provides
products and/or services outside the scope of the MSA. Certain of those
agreements involve the provision of USI Products and services and, as mutually
agreed by the Parties, will be performed by USI, with USI receiving the
associated revenue. USI agrees that, with regard to its performance of EDS'
obligations under each such agreement, it will perform such obligations for the
balance of the applicable agreement term and, to the extent associated EDS
personnel have been transferred to USI, will, for continuity, use the
transferred EDS personnel for the balance of the applicable agreement term. EDS
and USI will meet to agree about any aspects of ongoing performance under
agreements with GM for services outside the scope of the MSA that have not been
so allocated as of the date of this MOU. Existing agreements between EDS and GM
that have not been so allocated will continue to be performed by EDS until such
time as the contracts terminate or other alternative arrangements may be
mutually agreed between EDS and USI.
(b) As to non-MSA business opportunities arising after January 1, 1998, the
Executives in Charge will discuss the nature of the services. Interpretation as
to whether or not a GM request for service is an MSA Service or is outside the
scope of the MSA will be made by EDS, provided that EDS agrees to consult with
the USI Executive in Charge. Except as otherwise provided in this MOU, USI will
have a direct relationship with GM as to non-MSA business involving USI Products
and services and will solicit non-MSA business directly from GM. USI will enter
into agreements and other business arrangements directly with GM for provision
of such USI Products and services. USI will have sole responsibility for the
billing and collection of such non-MSA revenue from GM, unless otherwise agreed
by the EDS and USI Executives in Charge.
7. TEAMING ON NEW BUSINESS ACTIVITIES FOR GM. With respect to those
additional or new business opportunities with GM on which EDS and USI desire to
work together, whether MSA Services or services outside the scope of the MSA
(such opportunities being referred to as "New Business Activities"), EDS and USI
will work together as follows.
(a) The Executives in Charge will be the primary point of contact for each
in dealing with the other with respect to New Business Activities with GM on
which the Parties have decided to team. Each Executive in Charge will have the
authority and power to make decisions with respect to actions to be taken by EDS
or USI, as appropriate, in connection with New Business Activities.
(b) New Business Activities will be conducted on a project-by-project
basis, and any definitive written agreement related to the particular project
will address such issues as the scope,
structure, timing and price of the USI Products and/or services to be provided
and the respective responsibilities of the Parties. If EDS and USI deem it
appropriate, they may enter into one or more teaming agreements pursuant to
which they will cooperate in submitting bids for identifiable projects and in
which their roles with respect to the USI Products and/or services to be
provided will be agreed upon, such as designation of the prime contractor and
subcontractor for the project. If the USI Products and/or services to be
provided are MSA Services, EDS will be the prime contractor. If the USI Products
and/or services are not MSA Services, then USI will be the prime contractor
unless the Executives in Charge determine to vary their roles depending upon the
particular New Business Activity undertaken in the particular project. If the
USI Products and/or services to be provided are mixed (both MSA and non-MSA),
then EDS will provide the MSA Services, USI will provide the non-MSA Services,
and the designation as prime contractor will be as mutually agreed by the EDS
and USI Executives in Charge.
(c) EDS and USI will each exert reasonable efforts to produce a proposal
which will identify the prime contractor for a project and the acceptance of the
corresponding subcontractor for the project, and each will continue to work
toward this objective through any and all negotiations concerning a request for
proposal and subsequent contract negotiations if EDS and USI's proposal is
accepted.
IN WITNESS WHEREOF, each party has caused its duly authorized
representative to sign and deliver this MOU, all as of its effective date.
ELECTRONIC DATA SYSTEMS UNIGRAPHICS SOLUTIONS INC.
CORPORATION
By: /s/ D. Xxxxxxx Xxxxxxxxxxx By: /s/ Xxxx Xxxxxxx
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Name: D. Xxxxxxx Xxxxxxxxxxx Name: Xxxx Xxxxxxx
Title: Senior Vice President Title: President
