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EXHIBIT 10.1.7
MASTER AGREEMENT
(JAWS TECHNOLOGIES INC.)
This AGREEMENT (the "Agreement") is entered into as of, December 7, 1998,
between ABC INTERNET INC. ("ABC INTERNET INC."), with an address for purposes of
this Agreement at COMPANY ADDRESS ("ABC INTERNET INC."), and JAWS Technologies
Inc. ("JAWS"), whose principal place of business for purposes of this Agreement
is Xxxxx 000-000 0XX Xxxxxx X.X. Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0.
BACKGROUND
A. JAWS and ABC INTERNET INC. desire to work together with the goal
of furthering the marketing of the professional services and
products of JAWS.
B. JAWS desires to enhance its consulting service and product
revenues by offering services in connection with ABC INTERNET
INC.'s services.
C. ABC INTERNET INC. desires to enhance its capabilities to market
and support ABC INTERNET INC.'s in connection with the use of
JAWS services.
D. JAWS and ABC INTERNET INC. desire to formalize their
relationship by entering into this Agreement to undertake
cooperative efforts in connection with the products and services
of JAWS.
NOW, THEREFORE, JAWS and ABC INTERNET INC. agree as follows:
1. DEFINITIONS. The following capitalized terms shall have the meanings
given to them below when used in this Agreement:
"AGREEMENT DATE" shall have the meaning given to it in the introductory
paragraph of this Agreement.
"PRODUCTS" refers to all products listed in Schedule "A" and Schedule
"B" of this Agreement.
"PROPRIETARY INFORMATION" means:
(i) with respect to JAWS, the Products and all
confidential information and trade secrets contained in the
Products, including benchmark results, and any other information
of JAWS or its licensors which by its nature is generally
understood to be of a confidential nature; and
(ii) with respect to ABC INTERNET INC., any information
of ABC INTERNET INC. or of any customer of ABC INTERNET INC.
which ABC INTERNET INC. indicates is confidential or which, by
its nature, is generally understood to be
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confidential information and, without limiting the generality of
the foregoing, includes all customer lists and pricing
information of ABC INTERNET INC..
Information is not Proprietary Information to the extent that
it:
(A) is or becomes publicly available through no
act or failure of the receiving party; or
(B) is rightfully acquired from a third party
which, to the receiving party's knowledge, is not
obligated to keep that information confidential; or
(C) is independently developed by the receiving
party.
"SERVICES" refers to all services listed in Schedule "A" Key Management
Server Pricing and Schedule "B" Software & Services Pricing of this
agreement.
"SOFTWARE LICENSE AGREEMENT" means the encryption software license
agreement(s), as amended from time to time, to be executed by JAWS and
ABC INTERNET INC. in connection with the Products.
2. SERVICES AND RESPONSIBILITIES OF JAWS
(a) Employee Training. JAWS will provide to ABC INTERNET INC.
product and service training sessions at no additional charge to ABC
INTERNET INC.. These training sessions will pertain specifically to the
products and services contracted for by ABC INTERNET INC.. Refer to
Schedule "C" of this agreement for details regarding training sessions.
(b) Marketing Events. JAWS shall participate in and, if
requested by ABC INTERNET INC., assist in the organization and
implementation of, the jointly sponsored marketing events to be agreed
upon by the parties as part of the business plan referred to in Section
4 below.
(c) JAWS Coordinator. JAWS shall designate a coordinator with
appropriate authority to coordinate JAWS's activities with ABC INTERNET
INC. and act on behalf of JAWS within the scope of this Agreement.
3. SERVICES AND RESPONSIBILITIES OF THE PARTIES. To the extent reasonable
under the circumstances and as permitted by each party's other
agreements, the parties shall undertake the following cooperative
activities with respect to identifying opportunities to promote the
Products and Services:
(a) Market Information. Each party shall regularly inform the
other party about general market developments and factors relating to
the Products in the marketplace and current
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projects and customer implementations in which they are involved. This
information shall be designated and treated as Proprietary Information
of the party providing the information.
(b) Business Plan. Each party shall furnish the other party with
appropriate information for support and planning purposes, provided that
the furnishing party may determine, in its sole discretion, the content
and availability of such information. The parties will work together to
develop a business plan for their marketing efforts in connection with
this Agreement. Each party shall use commercially reasonable efforts to
meet the goals in the business plan.
(c) Internal Notification. Each party shall inform the
appropriate personnel in its organization of the existence of this
Agreement.
(d) New Product Information. Each party shall endeavor to keep
the other party appraised about new products and services relating to
the Products.
(e) Other Information. The parties shall exchange such other
information and conduct such other activities as the parties agree will
carry out the intent of this Agreement.
(f) Periodic Review. The parties shall meet at least twice a
year to review the status of their arrangement under this Agreement.
4. REPRESENTATIONS, WARRANTIES AND DISCLAIMERS
(a) Representations and Warranties. Each party hereby represents
and warrants to the other party that:
(i) Authority. It has the right and power to enter into
this Agreement.
(ii) No Violation. Entering into this Agreement does not
violate the terms and conditions of any of its other agreements
providing for cooperative marketing of products of another
entity, or any other legal obligations.
(iii) No Infringement. The products, materials and
information it provides under this Agreement to the other party
do not infringe upon or constitute a misappropriation of any
copyright, trademark, patent, trade secret or other proprietary
right of any third party in the Territory.
(b) Disclaimer of Warranty. EXCEPT AS SPECIFICALLY SET FORTH IN
THIS SECTION 5, NEITHER PARTY MAKES ANY WARRANTY TO THE OTHER PARTY,
EITHER EXPRESS, IMPLIED OR STATUTORY, NOR SHALL ANY WARRANTY ARISE BY
COURSE OF CONDUCT OR BY PERFORMANCE, CUSTOM OR USAGE IN THE TRADE,
INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTIES OF
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MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
5. TERM AND TERMINATION
(a) Initial Term. This Agreement shall have an initial term
commencing on the Agreement Date and continuing on perpetually, unless
terminated by either party.
(b) Termination. Each party may terminate this Agreement:
(i) In the event the other party fails to cure a
material breach of this Agreement within 30 days after receiving
written notice of that breach; or
(ii) immediately upon written notice if: (A) there is a
consolidation, merger or reorganization of the other party with
or into another corporation or entity; (B) there is a creation
of a new majority interest in, or change in majority ownership
or control of, the other party; (C) there is a sale of all or
substantially all of the assets of the other party; or (D) the
other party breaches the confidentiality provisions set forth in
Section 9, below; or
(iii) upon 90 days prior written notice to the other
party, with or without cause.
(c) Effect of Termination or Expiration. Upon termination or
expiration of this Agreement, each party shall cease acting in a manner
that would suggest any continuing relationship between the parties
regarding the Products, and shall cease all display and advertising
contemplated under this Agreement. Within 30 business days after the
termination or expiration, each party shall return to the other party or
dispose of (as mutually agreed) all advertising materials and other
property, including all Proprietary Information, furnished to it by the
other party pursuant to this Agreement. Each party shall certify in
writing to the other that it has done so. Termination or expiration of
this Agreement shall not affect any obligation either party has to its
customers. The following provisions of this Agreement shall in all
events survive its termination or expiration: Section 5
(Representations, Warranties and Disclaimers), 6 (Term and Termination),
7 (Relationship of the Parties), 8 (Intellectual Property Rights), 9
(Confidentiality of Proprietary Information), and 11 (General
Provisions).
6. RELATIONSHIP OF PARTIES. The following provisions shall apply to the
relationship of the parties, notwithstanding any other provision of this
Agreement:
(a) Independent Companies. JAWS and ABC INTERNET INC. are
independent companies acting for their own account, and neither party is
authorized to make any representation or commitment on behalf of the
other party. Neither party shall use the terms "joint venture",
"partner", "partnership" or similar terms to describe the relationship
between the parties under this Agreement. Any inadvertent use of such
terms shall refer to the spirit of cooperation between the parties and
shall not create a legal partnership or joint venture or any
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responsibility by one party for the actions of the other, either
expressly or by implication.
7. INTELLECTUAL PROPERTY RIGHTS
(a) TRADEMARKS, ETC. This Agreement does not authorize either
party to use or display any names, trademarks, logos or service marks of
the other party except to identify Products and Services to the extent
permitted by this Agreement. Either party may use the trademarks or
other proprietary words or symbols of the other party to properly
identify the Products or Services of the other party in correspondence
and proposals issued in the ordinary course of business to the extent
such use would be permitted by applicable law in the absence of this
Agreement. Except as described in the preceding sentence, each party
shall submit to the other party for written prepublication approval, any
materials which may use or display any name, trademark, logo or service
xxxx of the other party.
8. CONFIDENTIALITY OF PROPRIETARY INFORMATION. Each party acknowledges
that, during the term of this Agreement, it will receive Proprietary
Information from the other party. Each party shall protect the
Proprietary Information of the other party with at least the same
protection and care that it customarily uses in safeguarding its own
confidential information of a similar nature, but shall use no less than
a reasonable degree of care and will not use the Propriety Information
of the other party for any purpose other than in direct connection with
the relationship described under this Agreement. Each party will
disclose the other party's Proprietary Information to its personnel only
on a need-to-know basis. Each party shall take reasonable steps to
advise its employees of the confidential nature of the other party's
Proprietary Information and their obligation to comply with the
confidentiality requirements in this Agreement. Each party will promptly
notify the other if it believes that Proprietary Information has lost
its status as such.
9. FINANCIAL OBLIGATIONS.
(a) Royalties. JAWS agrees to provide ABC INTERNET INC. with the
management and maintenance of the Key Management Server. This server
will adhere to the specifications agreed to by both parties for E-mail
encryption services. This server will be located at 000, 000-0xx Xxxxxx
X.X. Xxxxxxx, Xxxxxxx, being JAWS's principal place of business. The
parties may from time to time by mutual agreement provide other services
pursuant to this agreement for such terms and at such costs as may be
agreed by the execution of additional schedules covering such items and
such schedules shall constitute part of this agreement for all purposes
as if the provisions there of were set forth herein.
(i) ABC INTERNET INC. will pay JAWS the royalties for
the Key Management Server, as per Schedule "A" of this
agreement. These royalties will be calculated in accordance with
the table on Schedule "A" attached. For clarity, ABC INTERNET
INC. will be permitted to charge to any recipient of an
encrypted E-mail for the decryption of that E-mail and there
will no additional charge from JAWS to any customer of
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ABC INTERNET INC. for the decryption of such encrypted E-mail.
(b) Reseller. JAWS hereby appoints ABC INTERNET INC. as a
reseller of, and grants to ABC INTERNET INC. the right to resell as per
Schedule "B" of this agreement. For clarity the software and services
are:
L5 E-MAIL ENCRYPTION SOFTWARE
L5 DATA ENCRYPTION SOFTWARE
SECURITY AUDITS
(i) Distribution. JAWS agrees to supply to ABC INTERNET
INC. master distributable images of Software Products. JAWS
further agrees to send new master distributable images of
Products within fourteen (14) days of release of revised
versions of Products. JAWS also agrees to notify ABC INTERNET
INC. within fourteen (14) days of discontinuation of Product.
(ii) Downloads and Collection. ABC INTERNET INC. further
agrees to make the Software Products available for download and
payment from customers via the Internet. ABC INTERNET INC. shall
make reasonable efforts to maintain the availability of on-line
delivery and payment. However, JAWS acknowledges that periodic
computer server and network failures are unavoidable and thus
will not hold ABC INTERNET INC. liable for damages or losses
incurred as a result of such failures.
(iii) Shipping. For L5 products that are not delivered
by download via the Internet, JAWS agrees to forward all
necessary customer and shipping information to ABC INTERNET
INC.'s fulfillment center after the transaction has been
approved by JAWS. ABC INTERNET INC. is responsible for ensuring
that Product is shipped to customer according to preference and
time frame selected by Customer. In the case that Products have
not been shipped to Customer within three business days, ABC
INTERNET INC. will refund payment to Customer.
(iv) Force Majeure. Neither party shall be liable for
the failure to perform any of its obligations under this
agreement, except for payment obligations, if such failure is
caused by the occurrence of any event beyond the reasonable
control of such party, including without limitation, fire flood,
strikes, and other industrial disturbances, failure of raw
materials, suppliers, failure of transport, accidents, riots,
insurrections, acts of God or orders of governmental agencies.
(v) Audit. For all audit services JAWS agrees to forward
all necessary customer information to ABC INTERNET INC., and to
provide sales support as required.
(vi) Direct Sales and Distribution Sales. For the direct
sales of Products
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described in Schedule "B", ABC INTERNET INC. will pay to JAWS
the price specified in Schedule "B". For services provided to
service customers, JAWS will pay ABC INTERNET INC. the amounts
specified in Schedule "B".
(vii) Payments and Reports. Payments shall be made on
the thirtieth (30th) day of each month, or the last day of
February, for sales of the previous month. ABC INTERNET INC.
shall provide JAWS a monthly report detailing the Products sold
and amounts collected.
(viii) Returns. If under any circumstance a payment
transaction for a Product is reversed, the net amount of the
reversal will be deducted from the amount of the payment due to
JAWS. If returns exceed sales in any given month, JAWS agrees to
make payment sufficient to cover returns. JAWS will accept the
return or exchange of any normally stocked product purchased
from JAWS which is unopened for up to 30 days after the date of
purchase. All Hardware Items must be returned within fourteen
(14) days. A defective Product may be exchanged for the same
title only and, in this case, the entire package (box, contents,
and product-registration card) must be included. ABC INTERNET
INC. will also refuse payment for the distribution of Products
to any Customer that is clearly abusing the system by processing
a large percentage of returns.
(ix) Charge Backs. If a payment transaction for a
Product is reversed due to a credit card chargeback, the net
amount of the reversal will be deducted from the amount due to
JAWS. A credit card chargeback will be allowed if ABC INTERNET
INC. is bound to reverse or reimburse a credit card payment made
to ABC INTERNET INC. because the credit card provider directs it
to do so or, as it is otherwise required by law.
(x) Records and Audits. ABC INTERNET INC. shall keep
records and accounts in accordance with generally accepted
accounting principles to show the amount of proceeds payable to
JAWS. ABC INTERNET INC. shall keep these records at ABC INTERNET
INC.'s principal place of business. JAWS shall have the right to
conduct at its sole expense an audit of such records by an
independent auditor during regular business hours upon five (5)
days prior written notice once per calendar year to determine
Electronic Distributor's compliance with this Agreement.
10. EXCLUSIVITY ABC INTERNET INC. will have exclusivity in Northern British
Columbia for a period of sixty (60) days beginning December 7, 1998. The
following provisions will apply:
(a) E-mail Encryption Service. JAWS will not sell or license or
provide or permit the use of any of its Products or Services, or allow
any subsidiary or affiliate or reseller or licensee to sell or license
or provide or permit the use of any of the Products or Services of JAWS,
to or by any customer or potential customer of such Products or Services
located in Northern British Columbia.
(b) Business Inquiries. JAWS will refer to ABC INTERNET INC.,
and cause its subsidiaries,
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affiliates, resellers and licensees to refer to ABC INTERNET INC. all
inquiries from customers (residential and corporate) located in Northern
British Columbia.
11. MOST FAVORED CUSTOMER PRICING. JAWS warrants that it has not, directly
or indirectly, entered into any agreement relating to the Products and
Services which provides pricing terms which are more favorable than the
pricing terms specified in this Agreement. If JAWS has entered into any
such agreement, or in the future enters into any such agreement, which
contains pricing terms which are more favorable than the pricing terms
specified in this Agreement, then JAWS will immediately notify ABC
INTERNET INC. and extend the same pricing terms to ABC INTERNET INC..
12. GENERAL PROVISIONS
(a) Non-Solicitation. During the term of this Agreement and for
a period of 12 months thereafter, personnel of either party who have
been directly and substantially involved in the performance of such
party's obligations under this Agreement shall not knowingly directly or
indirectly solicit for employment any of the other party's personnel who
have been directly and substantively involved in the performance of this
Agreement, without the prior written consent of the other party.
(b) Notice. All notices required to be given under this
Agreement shall be in writing and will be deemed given when actually
received. All notices shall be sent to the receiving party's address as
set forth below, or to such other address that a party provides as
required by this Section 11(b).
For JAWS:
JAWS Technologies Inc.
000 000 - 0 Xxxxxx X.X.
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0
Attn: Xxxxx Xxxxxx
And to:
For ABC INTERNET INC.:
#102, 0000 0xx Xxxxxx
Xxxxxx Xxxxxx, Xxxxxxx Xxxxxxxx X0X 0X0
(c) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the Province of Alberta,
without reference to its choice of law rules.
(d) Amendments. This Agreement may not be modified except in
writing signed by both
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parties.
(e) Severability. If any provision of this Agreement is held
invalid, such provision shall be deemed severed and the remaining
provisions shall be interpreted so as best to reasonably effect the
intent of the parties.
(f) Non-Assignment. Neither party may assign, transfer or
delegate this Agreement, or any of its rights or obligations under this
Agreement to any third party, other than a party controlling, controlled
by or under control with the assigning party, without the prior written
agreement of the other party. Subject to the above, this Agreement shall
be binding upon and inure to the benefit of the parties of this
Agreement, as well as their respective permitted successors and assigns.
Any assignment permitted under this section will not release the
assignor from liability under this Agreement.
(g) Waiver. Failure by any party to enforce any of the terms or
conditions of this Agreement, in any one or more instances, shall not be
construed as a waiver of the future performance of any such terms or
conditions.
(h) Limitation on Damages. Neither party (nor any of its
licensors) shall have any liability to the other party or any third
parties for any loss of business, loss of profits, loss of data, or
computer malfunction, or any indirect, incidental, special,
consequential or punitive damages, even if such party has been appraised
of the possibility of that loss or damage.
(i) Press Release and Publicity. Neither party shall issue any
news release, public announcement, advertisement or publicity concerning
this Agreement or any matters arising under this Agreement without the
prior written approval of the other party such approval not to be
unreasonably withheld.
IN WITNESS WHEREOF, the parties have caused this Master Agreement to be signed
by the authorized representatives as of the date first shown above.
JAWS TECHNOLOGIES INC. ABC INTERNET INC.
By:___________________________ By:___________________________
Date: December 7, 1998 Date: December 7, 1998
Name: Xxxxx Xxxxxx Name: Xxxxx de Fauw
Title: VP Sales & Channel Development Title: General Manager
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SCHEDULE "A"
KEY MANAGEMENT SERVER PRICING
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SERVICE PROVIDED DETAIL OF SERVICE SUBSCRIPTION
RATE
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E-MAIL ENCRYPTION DIAL UP ACCESS USERS INCLUDES:
Residential (Home Market)
Small Home Office
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=1,000 subscribers $1.00 /month
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1,001 - 5,000 for a total of all $0.75/month
subscribers
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5,001 - 10,000 for a total of all $0.50/month
subscribers
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10,001 + for a total of all $0.35/month
subscribers
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E-MAIL ENCRYPTION CORPORATE ACCOUNTS
By number of subscribers per
corporate account
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15 to 50 users - 1st 20 users $20.00/month
20 + users $0.50/month per
additional user
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51 to 200 users - 1st 65 users $40.00/month
65 + users $0.50/month per
additional user
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200 + users = custom quote To be determined
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SCHEDULE "B"
SOFTWARE & SERVICES PRICING
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PRODUCT NAME SUGGESTED RETAIL PRICE PRICE
--------------------------------------------------------------------------------
L5 E-MAIL ENCRYPTION
SOFTWARE $US14.95 $US12.95
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L5 DATA ENCRYPTION
SOFTWARE - PROFESSIONAL
EDITION
--------------------------------------------------------------------------------
- electronic downloadable $US49.95 $US39.95
file.
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- retail boxed product $US49.95 $US34.95
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SERVICES PRICING - AUDITS
--------------------------------------------------------------------------------
- Snapshot Audit $CDN3,000.00 $CDN2,000.00
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- Full Security variable 10% finders fee
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SCHEDULE "C"
PRODUCT AND SERVICE TRAINING
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TRAINING PROVIDED DETAIL OF TRAINING LENGTH
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L5 E-MAIL ENCRYPTION Server Management N/A
Orientation - user documentation
Key Management - online help
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5 DATA ENCRYPTION User documentation included N/A
with Software
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SERVICES Sales & Marketing One (1) day
- E-mail Encryption - audit overview
- Audits - how to position and sell audits
- how to position and sell
secure E-mail
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