Exhibit 10.9
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Execution Copy
AMENDED AND RESTATED
SOFTWARE LICENSE AGREEMENT
This Amended and Restated Software License Agreement (the "Agreement") is
made as of July 31, 1998 (the "Effective Date") by and between Red Brick
Systems, Inc., a Delaware corporation, with its principal office located at 000
Xxxxxxx Xxx, Xxx Xxxxx, Xxxxxxxxxx 00000 ("Red Brick") and Engage Technologies,
Inc. ("Engage"), a Delaware corporation with its principal office located at 000
Xxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxxxxx 00000, including its parent company
CMG Information Services, Inc. ("CMGI") and CMGI's majority-owned subsidiaries
(individually, or collectively with Engage and CMGI, "Licensee"), and amends and
restates the Software License Agreement between the parties, dated August 29,
1997.
The following Exhibits are made a part of this Agreement:
Exhibit 1: Defined Terms
Exhibit 2: End User Terms
Exhibit 3: Fees
Exhibit 4: Additional Features for Modified Red Brick Formation Licensed
Materials
In consideration of the covenants, representations and warranties set forth
herein and other good and valuable consideration, the parties agree as follows:
ARTICLE 1: DELIVERIES AND UPDATES
1.1 Delivery of Red Brick Formation.
-------------------------------
Immediately following execution of this Agreement Red Brick will provide
Licensee at no cost with one (1) master media containing the beta version of Red
Brick Formation 1.3 (the "Red Brick Formation 1.3 beta") in both object code and
source code form, along with all related software development kits and/or tools
and one (1) master copy of each item of all documentation for the Red Brick
1
Formation 1.3 beta to the extent such documentation is then available (together
the "Red Brick Formation Licensed Materials").
Red Brick's obligation to provide source code for the Red Brick Formation
Licensed Materials will not apply for portions, but only such portions, of the
Red Brick Formation Licensed Materials which are licensed to Red Brick by third
parties under agreements which do not permit the provision to Licensee of a
source code form of such portions of the Red Brick Formation Licensed Materials.
Red Brick's obligation to provide source code for the Red Brick Formation
Licensed Materials also will not apply to portions of the Red Brick Formation
Licensed Materials which are derived from Red Brick Warehouse Products which
existed before Red Brick's acquisition of the Database Technology from Licensee,
do not incorporate, in whole or in part, any of the Database Technology, and
whose absence shall not reduce the functionality of the Red Brick Formation
Licensed Materials or Database Technology below the performance level of such
materials at August 29, 1997, notwithstanding minor software defects which may
have existed as of August 29, 1997.
1.2 Delivery of Database Technology.
-------------------------------
Upon completion of the Services requested in Work Order Number One (as such
terms are defined in that certain Consulting Services Agreement entered into
between the parties as of August 29, 1997 ("Consulting Agreement")), Red Brick
shall provide Licensee at no cost with one (1) master media containing the
Database Technology in source code and object code form and one (1) master copy
of each item of all documentation for the Database Technology to the extent such
documentation is then available.
1.3 Updates.
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Upon the earlier of (i) March 15, 1998 or (ii) completion of the
deliverable described in Section 3(b) of Work Order Number Two of the Consulting
Agreement (the "Start Date") and for a period of two years thereafter, Red Brick
shall provide Licensee at no cost with one (1) master media containing all
Updates in source code and object code form and one (1) master copy of each item
of all documentation for all Updates to the extent such documentation is then
available. Beginning two years after the Start Date, Red Brick shall provide
Licensee with all subsequent Updates at the same time Red Brick makes such
Updates available to its customers, provided Licensee has elected to pay Royalty
--------
Fees in accordance with Section 2.5.1 of this Agreement and is current in the
payment of all such Royalty Fees. In the event Licensee elects not to pay
Royalty Fees, Red Brick's obligation to provide Licensee with Updates shall
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terminate automatically upon the second anniversary of the Start Date; provided
that if the last Update provided by Red Brick to Licensee during such two-year
period was made generally available to customers more than four (4) months prior
to the last day of such two-year period, then Red Brick shall provide Licensee
with the next Update, at such time as such Update is made available to
customers, at no charge (the period through the later of such Update or two
years after the Start Date is the "Royalty-Free Period"). All Updates provided
by Red Brick to Licensee pursuant to this Section 1.3 shall be deemed part of
the "Licensed Software" for purposes of this Agreement.
Red Brick's obligation to provide source code for the Updates will not
apply for portions, but only such portions, of the Updates which are licensed to
Red Brick by third parties under agreements which do not permit the provision to
Licensee of a source code form of such portions of the Updates. Red Brick's
obligation to provide source code for the Updates also will not apply to
portions of the Updates which are derived from Red Brick Warehouse Products
which existed before Red Brick's acquisition of the Database Technology from
Licensee, do not incorporate, in whole or in part, any of the Database
Technology, and whose absence shall not reduce the functionality of the Updates
or Database Technology below the performance level of such materials at August
29, 1997, notwithstanding minor software defects which may have existed as of
August 29, 1997.
1.4 Development of Additional Features for Red Brick Formation.
----------------------------------------------------------
Red Brick will use commercially reasonable efforts to develop and deliver
to Licensee a modified version of the Red Brick Formation Licensed Materials by
March 31, 1999 (the "Modified Red Brick Formation Licensed Materials"). The
Modified Red Brick Formation Licensed Materials will include the features set
forth in Exhibit 4 attached hereto. Red Brick will began work on the Modified
Red Brick Formation Licensed Materials within thirty (30) days of the signing of
this Agreement. Thereafter, until the Modified Red Brick Formation Licensed
Materials are delivered to Licensee, Red Brick will provide Licensee on a weekly
basis with a copy of the high level project plan for the completion of the
Modified Red Brick Formation Licensed Materials and weekly status against the
plan. Failure by Red Brick to deliver the Modified Red Brick Formation Licensed
Materials to Licensee by May 31, 1999 shall result in Red Brick being required
to make the payments specified below in compensation of the damages to Licensee
for such delay in delivery. Upon the end of every month, beginning with May 31,
1999, if Red Brick has failed to make delivery of the Modified Red Brick
Formation Licensed Materials by such date, Red Brick shall pay to Licensee the
sum of $50,000. As an example, if Red Brick delivers the Modified Red Brick
Formation Licensed Materials on August 8, 1999, Red Brick would be obligated to
pay Licensee $50,000 on May 31, 1999, $50,000 on June 30, 1999 and $50,000 on
July 31, 1999. Red Brick's obligations to pay the liquidated damages described
above will be capped at a total payment of $250,000, which maximum payment
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will be reached in the event that delivery of the Modified Red Brick Formation
Licensed Materials has not occurred by September 30, 1999.
If Red Brick is not able, through commercially reasonable efforts, to
obtain the third party licenses and rights to the software necessary to develop
and include in the Modified Red Brick Formation Licensed Materials the features
set forth in Exhibit 4, then Licensee will use commercially reasonable efforts
to obtain such rights on behalf of Red Brick and/or to grant such rights to Red
Brick. If neither Red Brick or Licensee is able to obtain such licenses and
rights for Red Brick's benefit in developing and implementing the features set
forth in Exhibit 4, then Red Brick will not be required to implement the
features, but only such features, in the Modified Red Brick Formation Licensed
Materials, for which the parties are not able to obtain the necessary third
party licenses and rights.
If Red Brick chooses not to market a specific database adapter set forth in
Exhibit 4 and as such does not obtain the third party licenses and rights to the
software necessary to market such adapter, then, in the event Licensee desires
that the Modified Red Brick Formation Licensed Materials contain such adapter,
Licensee will use commercially reasonable efforts to obtain such rights on
behalf of Red Brick and/or to grant such rights to Red Brick. If Licensee is
not able to obtain such licenses and rights for Red Brick's benefit in including
a specific database adapter set forth in Exhibit 4, then Red Brick will not be
required to implement the specific adapter, but only such adapter, in the
Modified Red Brick Formation Licensed Materials, for which the Licensee is not
able to obtain the necessary third party licenses and rights.
1.5 Delivery of Modified Red Brick Formation Licensed Materials.
-----------------------------------------------------------
Upon completion of the development of the Modified Red Brick Formation
Licensed Materials, Red Brick shall provide Licensee at no cost with one (1)
master media containing the Modified Red Brick Formation Licensed Materials in
both object code and source code form and one (1) master copy of each item of
all documentation for the Modified Red Brick Formation Licensed Materials to the
extent such documentation is then available.
Red Brick's obligation to provide source code for the Modified Red Brick
Formation Licensed Materials will not apply for portions, but only such
portions, of the Modified Red Brick Formation Licensed Materials which are
licensed to Red Brick by third parties under agreements which do not permit the
provision to Licensee of a source code form of such portions of the Modified Red
Brick Formation Licensed Materials. Red Brick's obligation to provide source
code for the Modified Red Brick Formation Licensed
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Materials also will not apply to portions of the Modified Red Brick Formation
Licensed Materials which are derived from Red Brick Warehouse Products which
existed before Red Brick's acquisition of the Database Technology from Licensee,
do not incorporate, in whole or in part, any of the Database Technology, and
whose absence shall not reduce the functionality of the Modified Red Brick
Formation Licensed Materials or Database Technology below the performance level
of such materials at August 29, 1997, notwithstanding minor software defects
which may have existed as of August 29, 1997.
1.6 Ongoing Support of Modifications.
--------------------------------
Red Brick covenants and agrees that for all future versions and Updates to
the Database Technology, Red Brick Formation Licensed Materials and Modified Red
Brick Formation Licensed Materials (the "Licensed Software"), which future
versions and Updates occur subsequent to the development of the Modified Red
Brick Formation Licensed Materials called for by Section 1.4 of this Agreement,
Red Brick will continually maintain, update and support in such future versions
and Updates of the Licensed Software the features set forth on Exhibit 4 hereto.
ARTICLE 2: LICENSED ACTIVITIES
2.1 License Grant.
-------------
Subject to the terms and conditions of this Agreement, Red Brick hereby
grants to Licensee and Licensee hereby accepts a perpetual, non-transferable
(except as provided herein), worldwide, license to exercise all rights
whatsoever as provided below with respect to the Licensed Software only for the
Clickstream Market (the "License"):
2.1.1 to use, copy and modify the Licensed Software for internal purposes,
which shall include, without limitation, installation at customer sites of the
Licensed Software by Licensee solely for the purpose of customer access to the
end-user query portion of the Licensed Software in conjunction with Licensee's
provision of data management services.
2.1.2 to use, copy and modify the Licensed Software solely for the purpose
of incorporating the Licensed Software into the Application Suite.
2.1.3 to, either directly or through Resellers (as defined below),: (i)
market, distribute, copy and license (with the right to sublicense) the Licensed
Software in object code form only, only as incorporated in the Application
Suite, in the Clickstream Market; (ii) demonstrate the Licensed Software only as
incorporated in the Application Suite to prospective customers for use in the
Clickstream Market; (iii)
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internally use the Licensed Software to provide technical support to end user
customers or prospective customers; and (iv) license the Licensed Software only
as incorporated in the Application Suite to end users for use in the Clickstream
Market on a trial basis only pursuant to a trial license agreement containing
all terms set forth in Exhibit 2.
2.2 License Restrictions.
--------------------
Notwithstanding anything else in this Agreement, this Agreement does not
include a grant to Licensee of any ownership right, title or other interest, in
any of Red Brick's Rights (as defined in Section 3.2) relating to the Licensed
Software nor in any copy or part thereof. In particular, and without
limitation, Licensee shall not: (i) delete or fail to reproduce any copyright
or other proprietary notices appearing in the Licensed Software, (ii) sublicense
or otherwise distribute Licensed Software in source code form, or (iii)
sublicense or otherwise distribute the Licensed Software in object code form
except when incorporated into the Application Suite.
2.3 Resellers.
---------
Subject to the terms and conditions of this Agreement, Licensee may appoint
authorized resellers ("Resellers") to use and distribute the Licensed Software
only as provided in Section 2.1 provided that each such Reseller shall be bound
by written agreement with Licensee that (a) protects the confidentiality of' and
Red Brick's rights in, the Licensed Software to the same extent as provided
under this Agreement, and prevents the Reseller from disassembling, decompiling
or otherwise reverse engineering the Licensed Software or, except as expressly
provided in this Agreement, otherwise attempting to learn source code,
structure, or algorithms underlying the Licensed Software (except to the extent
that such prohibitions are limited by law in certain jurisdictions, in which
case the affected prohibitions shall be included in such jurisdictions in as
restrictive and protective a form as they are allowed, with unaffected
prohibitions remaining unchanged); and (b) limits the liability of Red Brick to
the same extent as provided under the terms of this Agreement. Licensee shall
remain directly liable to Red Brick and shall indemnify, defend and hold
harmless Red Brick for any breach by any of Licensee's Resellers of such
agreement.
2.4 End User Licenses.
-----------------
Prior to or upon delivery of the Application Suite containing a copy of the
Licensed Software to an end user, Licensee and its Resellers shall enter into a
written binding license agreement with the end user which shall contain terms at
least as restrictive as those set forth on Exhibit 2 ("End User License
Agreement"). Licensee shall provide Red Brick with copies of such End-User
License Agreements upon request.
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2.5 Fees.
----
2.5.1 Obligation to Pay Royalty Fees. During the Royalty-Free Period and
------------------------------
thereafter, Licensee may sublicense the Licensed Software in accordance with the
terms of this Agreement and incur no royalty payment obligation to Red Brick;
provided that Licensee does not sublicense or otherwise provide its customers
any Update provided to Licensee by Red Brick after the Royalty-Free Period. No
later than thirty (30) days prior to the release of the first Update after the
Royalty-Free Period, Licensee shall notify Red Brick in writing whether it
elects to continue to receive Updates. In the event Licensee elects not to
receive subsequent Updates, Red Brick shall have no further obligation to
provide Licensee with Updates and Licensee shall have no obligation to pay Red
Brick Royalty Fees. In the event Licensee elects to continue to receive Updates
and provided that Licensee is in good standing under this Agreement: (a) Red
Brick shall continue to provide Licensee with Updates at the same time Red Brick
makes such Updates available to its customers, provided Licensee is current in
the payment of all Royalty Fees and is in good standing under this Agreement;
and (b) Licensee shall be obligated to pay Red Brick the Royalty Fees solely
with respect to revenue recognized from the Application Suite Components
incorporating Updates received after the Royalty-Free Period and distributed to
its customers in accordance with the fee schedule set forth in Exhibit 3 and the
terms of this Agreement. The parties hereto agree that revenue received by
Licensee from the entire Application Suite shall be fairly allocated between (i)
the Application Suite Components and (ii) those components of the Application
Suite which do not incorporate Updates of the Licensed Software received after
the Royalty-Free Period, such allocation to be based on the relative value of
such Application Suite Components and such other components to the End Users.
2.5.1.1 Licensee's Option to Terminate Obligation to Pay Royalty
--------------------------------------------------------
Fees. At any time during the term of this Agreement when Licensee has an
----
obligation to pay Red Brick Royalty Fees in accordance with Section 2.5.1,
Licensee may elect upon sixty (60) days prior written notice to Red Brick to
terminate its obligation to pay Royalty Fees; provided that Licensee shall
continue to pay Red Brick Royalty Fees for a period of eighteen (18) months
hereafter solely with respect to revenue recognized from the Application Suite
Components incorporating Updates received by Licensee after the Royalty-Free
Period and distributed to its customers in accordance with the fee schedule set
forth in Exhibit 3. Upon receipt of such notice, Red Brick shall have no
obligation to provide Licensee with subsequent Updates. The parties may agree
under a separate maintenance agreement to be negotiated by Red Brick and
Licensee for Red Brick to maintain the Licensed Software specifically for
Licensee under terms to be negotiated. Nothing in this Section 2.5.1.1 shall
restrain Red Brick's ability in any way to continue
7
with its own development efforts with respect to the Licensed Software or any
other Red Brick products.
2.5.2 Pass-Through Royalty Fees. During the entire term of this
-------------------------
Agreement, Licensee shall pay Red Brick an amount equal to the actual variable,
incremental cost paid by Red Brick that is fairly allocated to Licensee's
exercise of its rights hereunder with respect to third-party technology embedded
in the Licensed Software and Updates incorporated into any Application Suite
licensed or otherwise distributed by Licensee ("Pass-Through Royalty Fees").
Each quarter during the term of this Agreement, within fifteen (15) days after
the end of the quarter, Red Brick shall provide Licensee an invoice and report
documenting such costs incurred by Red Brick during the quarter, and a full and
accurate accounting thereof.
2.5.3 Royalty Fee Reports. Each quarter during the term of this Agreement
-------------------
when Licensee has an obligation to pay Royalty Fees, within fifteen (15) days
after the end of the quarter, Licensee shall submit a report to Red Brick
describing any Royalty Fee payments made or due; number of copies of the
Application Suite shipped; the shipment date; and the end user name, address,
hardware, and operating system; as well as any information necessary or useful
for calculating/verifying all Fees due. Any Royalty Fee amounts due based on
Licensee activity or revenue in such quarter will be paid at the same time.
2.5.4 Payment Terms and Compliance. All payments of Fees shall be made
----------------------------
inside the U.S., in U.S. dollars net thirty (30) days from receipt of invoice;
provided, however, Royalty Fees shall be due and payable upon submission of each
quarterly Report as required pursuant to Section 2.5.3. Any payments more than
thirty (30) days overdue will bear a late payment fee of 1.5% per month, or, if
lower, the maximum rate allowed by law. Licensee shall at all times keep and
maintain complete and accurate records that include at least the following
information: name and address of each end user, number of quantities and date
of purchase. Red Brick may, with no less than five (5) business days' notice,
and at Red Brick's expense, have an independent auditor or accountant audit,
during normal business hours, Licensee's records related to the Licensed
Software and Updates to verify Licensee's compliance with the provisions of this
Agreement. If an audit determines that there is an underpayment of five percent
(5%) or more of any amounts due hereunder, Licensee shall promptly pay the
deficiency and reimburse Red Brick for the cost of the audit.
2.6 Support.
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2.6.1 Separate Support Agreement. Within thirty (30) days after the
--------------------------
Effective Date of this Agreement, the parties will execute a separate support
agreement ("Support Agreement") under the terms of which Red Brick shall provide
Licensee with such technical support services for the Licensed Software as the
parties mutually
8
agree at a price mutually agreed to by the parties for an initial period of
two (2) years from the execution date of such support agreement. In the Support
Agreement the parties will also mutually agree upon the terms and
responsibilities between the parties for all installation, training and
consultation, and all other maintenance and support directly to end users with
respect to any Licensed Software incorporated into the Application Suite.
2.7 Escrow of Source Code. Red Brick agrees that upon the request of a
---------------------
licensee of Licensee or its Resellers (known as an "End User"), which End User
has licensed all or any part of the Licensed Software, Red Brick will allow
Licensee or its Resellers to place into an escrow one (1) copy of the latest
version of the source code of all Licensed Software licensed to such End User,
together with all related programmer documentation, instructions, flow charts
and other materials necessary for a reasonably skilled programmer or analyst to
use the said source code to maintain and modify the Licensed Software licensed
to such End User, without the assistance of other persons or reference to other
persons (the "Source Code Materials"). Red Brick shall promptly supplement said
deposit with Source Code Materials for any new Updates, releases or additional
products licensed to Licensee, and sublicensed by Licensee or its Resellers to
End User during the term of this Agreement. The deposit will be pursuant to the
terms of an agreement (the "Escrow Agreement") among Licensee or its Resellers,
End User and a third party escrow firm of national reputation specializing in
software escrows ("Escrow Agent") and will be in a form mutually acceptable to
such Licensee or its Resellers, End User and Escrow Agent. In the event such an
Escrow Agreement is established, Red Brick hereby grants to the Licensee, its
Resellers and the End User for whose benefit the escrow is established the
license rights to the Licensed Software which are granted pursuant to the Escrow
Agreement.
ARTICLE 3: INTELLECTUAL PROPERTY; CONFIDENTIALITY
3.1 Licensee Ownership.
------------------
Licensee shall have all right, title and interest (including all patent
rights, copyrights, trade secret rights, and other intellectual property or
proprietary rights throughout the world (collectively referred to as "Licensee's
Rights")) in (a) its Confidential Information, (b) the Application Suite
(including the perpetual License to the Licensed Software for the Clickstream
Market as provided in Section 2.1) and (c) modifications, enhancements,
improvements or new versions of the Licensed Software and the Application Suite
created by Licensee or its contractors or created by Red Brick as Custom Code
for Licensee under the Consulting Agreement. At
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Licensee's sole discretion, Red Brick may negotiate a license to use (but not
sublicense) for use solely outside the Clickstream Market except as otherwise
agreed by Licensee explicitly and in writing such modifications of the Licensed
Software by Licensee or its contractors or created by Red Brick as Custom Code
for Licensee under the Consulting Agreement.
3.2 Red Brick Ownership.
-------------------
Red Brick shall have all right, title and interest (including all patent
rights, copyrights, trade secret rights, and other intellectual property or
proprietary rights throughout the world (collectively referred to as "Red
Brick's Rights")) in and to (a) its Confidential Information (b) the Licensed
Software and any modifications, enhancements, improvements or new versions
thereof developed by Red Brick or its contractors, except as provided otherwise
in the Consulting Agreement with respect to Custom Code, including but not
limited to all Updates, but excluding Licensee's Rights as defined in Section
3.1.
3.3 No Other Rights or Licenses.
---------------------------
Except as expressly provided in this Agreement, neither party is granted
any right or license to any of the foregoing or to any rights of the other.
3.4 Confidential Information.
------------------------
The parties acknowledge and agree that during the course of performing
their duties under this Agreement, the parties may exchange confidential and
proprietary information ("Confidential Information"). Confidential Information
shall include, without limitation, customer lists, the Licensed Software, the
Application Suite, trade secrets, product plans and schedules, new product
information, technical data and know-how, instructional and operating manuals,
financial information, marketing and sales data and plans, and any other
business, financial or technical information. Each party acknowledges that the
Confidential Information of the other party constitutes valuable trade secrets
of that party. Both parties agree that this Agreement establishes a
confidential relationship between Licensee and Red Brick as to the other party's
Confidential Information. Each party agrees, therefore, to preserve the
confidential nature of the other party's Confidential Information by retaining
and using such Confidential Information in trust and confidence, solely in
accordance with their rights under this Agreement, and further agrees not to
(except as may be otherwise permitted under this Agreement or any other
agreement between the parties) (i) use the Confidential Information; (ii)
disclose the Confidential Information to any third parties; (iii) permit the use
of such Confidential Information by, or disclosure of such Confidential
Information to unauthorized persons. Each party agrees to promptly report to
the other party any violations of these provisions by its employees,
consultants, or agents of which they are aware. Except as otherwise
10
permitted under this Agreement or any other agreement between the parties,
neither party shall copy or make, or cause or permit any third party to copy
such Confidential Information, in whole or in part, without the prior written
consent of the other party. A party receiving Confidential Information shall not
be obligated under this Section 3.4 with respect to information the receiving
party can document: (a) is or has become readily publicly available without
restriction through no fault of the receiving party or its employees or agents;
(b) is received without restriction from a third party lawfully in possession of
such information and lawfully empowered to disclose such information; (c) was
rightfully in possession of the receiving party without restriction prior to its
disclosure by the other party; or (d) was independently developed by the
receiving party by employees without violation of this Section 3.4.
Notwithstanding the foregoing, all Database Technology existing as of August 29,
1997 shall be deemed Confidential Information of Red Brick disclosed to Licensee
under this Agreement and exceptions (c) and (d) above will not be applicable
thereto.
ARTICLE 4: WARRANTIES; LIABILITY LIMITATION
4.1 Warranties.
----------
At such future time as Red Brick makes generally available it first release
of Red Brick Formation or a similar successor product, Red Brick will make all
representations and warranties to Licensee concerning such release, and all
Licensed Software and Updates thereto provided subsequent to the date of such
release, that Red Brick makes to end users concerning such licensed materials
under its standard software license agreement.
EXCEPT AS OTHERWISE SET FORTH IN THIS AGREEMENT, THE LICENSED SOFTWARE IS
PROVIDED "AS IS." EXCEPT AS OTHERWISE SET FORTH IN THIS AGREEMENT RED BRICK
MAKES NO WARRANTIES TO ANY PERSON WITH RESPECT TO THE LICENSED SOFTWARE OR ANY
SERVICES PROVIDED HEREUNDER, AND DISCLAIMS ALL IMPLIED WARRANTIES, INCLUDING
WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE AND NON-INFRINGEMENT.
4.2 Limitation of Liability.
-----------------------
IN NO EVENT SHALL ANY PARTY UNDER THIS AGREEMENT BE LIABLE WITH RESPECT TO
ANY SUBJECT MATTER OF THIS AGREEMENT UNDER ANY CONTRACT, NEGLIGENCE (EXCLUDING
WILLFUL MISCONDUCT), STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY FOR (I)
ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOST PROFITS OR LOST DATA OR COST OF
PROCUREMENT OF SUBSTITUTE GOODS, TECHNOLOGY OR SERVICES OR (II) FOR ANY AMOUNT
IN EXCESS OF $10,000, EXCLUDING,
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HOWEVER, LIABILITY FOR BREACH OF SECTION 3.4 OR RED BRICK'S DUTY OF
INDEMNIFICATION PURSUANT TO SECTION 5.1.
ARTICLE 5: INDEMNIFICATION
5.1 Red Brick Duty of Indemnification.
---------------------------------
Except with respect to that portion of the Database Technology existing as
of August 29, 1997, Red Brick shall hold Licensee, its directors, officers,
employees and agents harmless from, and indemnify them against, all demands,
costs, damages, expenses, including reasonable attorneys' fees, and liabilities,
including amounts paid in settlement, for any claim or suit ("Claim") brought
against Licensee by a third party alleging that the use or distribution of the
Licensed Software by Licensee, its directors, officers, employees or agents
hereunder infringes upon any United States patent, trademark, copyright, or
trade secret; provided that Licensee (i) gives Red Brick prompt written notice
of the Claim and (ii) gives Red Brick all necessary information, reasonable
assistance and sole authority to defend and/or settle the Claim. In the event
that the use or distribution of the Licensed Software as permitted hereunder is
held to constitute an infringement, Red Brick shall, at its option and sole
expense, (a) modify or replace the Licensed Software so that it performs
comparable functions without material degradation in efficiency and without
infringement; or (b) obtain a perpetual, royalty-free license for Licensee to
use the infringing portion of the Licensed Software. Red Brick shall have no
liability for any Claim or infringement to the extent the same is based on (x)
use or combination of the Licensed Software with equipment, devices, software or
data not supplied by Red Brick; (y) the Licensed Software having been modified
by Licensee or; (z) use of the Licensed Software in a manner for which the
Licensed Software was not designed.
5.2 Licensee Duty of Indemnification.
--------------------------------
Licensee agrees to enforce and to use its best efforts to cause its
authorized Resellers to enforce the terms of the End User License Agreements
granted in accordance with the terms of this Agreement and to inform Red Brick
of any breach of such terms. Licensee will defend and indemnify Red Brick
against all damages, payments, costs and expenses (including attorney's fees)
for all claims or alleged claims (i) related to any use by Licensee, its
Resellers, or end users of the Licensed Software; or (ii) related to the failure
by Licensee or its Resellers to include in any End User License Agreement
granted hereunder the required contractual terms as set forth in Exhibit 2.
ARTICLE 6: TERM AND TERMINATION
6.1 Term and Termination.
--------------------
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The term of this Agreement shall be perpetual, commencing as of the
Effective Date. The rights and obligations under Article 1 and Sections 2.4,
2.5 and 2.6 of this Agreement may be terminated by either party in the event of
a material breach by either party of any warranty, covenant, or other provision
of this Agreement which is not cured within thirty (30) days of notice. In no
event shall Red Brick have any right whatsoever to terminate any part or all of
Sections 2.1 through 2.4, Section 2.7 and Article 3 hereof, provided, however,
that Red Brick shall have the right to terminate the License granted Licensee
under Section 2.1 for failure by Licensee to pay fees due under Work Order
Number Two to the Consulting Services Agreement following written notice of such
failure given by Red Brick to Licensee provided such failure is not cured within
thirty (30) days following receipt of such notice by Licensee.
6.2 Survival.
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The following Articles and Sections shall survive any termination of this
Agreement: Sections 2.1 through 2.5 (except as provided in the last sentence of
Section 6.1) and Section 2.7, Article 3 in its entirety, Sections 4.2, 5.1, 5.2,
6.1, 6.2 and Articles 7 and 8 in their entirety.
In the event that this Agreement is terminated for any reason, the rights
of the End Users to whom the Licensee may have distributed Licensed Software
pursuant to this Agreement will be unaffected by such termination. Within
thirty (30) days after the effective date of the termination of this Agreement,
Licensee shall deliver to Red Brick complete and accurate copies of all executed
End User license agreements that survive termination of this Agreement that are
held in Licensee's possession. In order to maintain their rights End Users must
continue to abide by the terms of their End User agreements.
ARTICLE 7: CONTRACTORS
7.1 Licensee's Use of Contractors.
-----------------------------
Notwithstanding any other provision of this Agreement, Licensee's
contractors shall have the same right to use the Licensed Software as afforded
to Licensee and its employees hereunder, provided that (i) Licensee shall ensure
that its contractors comply with the terms of this Agreement, (ii) Licensee
shall remain liable to Red Brick for the actions of its contractors, and (iii)
the contractors shall enter into a confidentiality agreement with Licensee
containing terms substantially similar to those set forth in Section 3.4.
ARTICLE 8: GENERAL TERMS AND CONDITIONS
8.1 Equitable Relief.
----------------
13
Each party acknowledges that any breach of its obligations with respect to
the rights of the other party will cause the other party irreparable injury for
which there are inadequate remedies at law and that the other party shall be
entitled to equitable relief in addition to all other remedies available to it;
provided, however, that in no event will such equitable relief affect in any
respect the rights and obligations of the parties under Articles 2 and Sections
3.1 and 3.2 hereof.
8.2 Remedies.
--------
In the event of Termination for breach, the sole remedy of either aggrieved
party shall be money damages.
8.3 Relationships between Parties.
-----------------------------
In all matters relating to this Agreement, Licensee will act as an
independent contractor. The relationship between Red Brick and Licensee is that
of licensor/licensee. Neither party will represent that it has any authority to
assume or create any obligation, express or implied, on behalf of the other
party, nor to represent the other party as agent, employee, franchise, or in any
other capacity. Except as provided herein and in the agreements referenced in
Article 8.10, nothing in this Agreement shall be construed to limit either
party's right to independently develop or distribute software which is
functionally similar to the other party's product, so long as proprietary
information and Confidential Information of the other party is not used in such
development.
8.4 Assignment.
----------
Except as expressly contemplated hereby, neither this Agreement nor any of
the rights, interests or obligations hereunder may be assigned by a party
(whether by operation of law or otherwise) without the prior written consent of
the other party, which consent shall not be unreasonably withheld; provided that
either party may assign this Agreement and any of its rights, interests or
obligations hereunder to any successor in connection with a merger or
consolidation and any assignee or successor in interest to any such party in
connection with the sale of substantially all of such party's assets, including,
without limitation, the sale, merger or acquisition of Engage or the sale,
merger or acquisition of CMG. Subject to the preceding sentence, this Agreement
will be binding upon, inure to the benefit of and be enforceable by the parties
and their respective successors and assigns. In the event of any assignment of
this Agreement by any party hereto, or the merger, acquisition or consolidation
of any party hereto, or the sale of substantially all of such party's assets (or
the sale of the Licensed Software), such party hereby agrees that any such
assignee, acquirer or purchaser shall execute an agreement of assumption
satisfactory to the other party in all respects, whereby such assignee, acquirer
or purchaser agrees to be bound by all
14
of the obligations of such party hereunder in all respects. The respective
obligations and covenants of each party hereto shall be binding upon each party
and its respective affiliates, being those persons or legal entities
controlling, controlled by or under common control with such parties.
8.5 Notices.
-------
All notices, including notices of address change, required to be sent
hereunder shall be in writing and shall be deemed to have been given when mailed
by first class mail to the address set forth under the signature blocks at the
end of this Agreement, Attention: Legal/Contracts Department.
8.6 Governing Law/Jurisdiction.
--------------------------
This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts, without regard to any applicable
conflicts of laws. Red Brick, and Licensee each agree that all disputes arising
among them related to this Agreement, whether arising in contract, tort, equity
or otherwise, shall be resolved only and exclusively in either the United States
Federal Court in Boston, Massachusetts, or in a Massachusetts state court
located in Essex County, Massachusetts. Red Brick hereby consents to the
jurisdiction of the United States Federal Court in Boston, Massachusetts, and of
the Massachusetts state courts in Essex County, Massachusetts, with respect to
any action, suit or proceeding commenced in any such court by Licensee or by
their successors or assigns, and Red Brick waives any defense it may have with
respect to such jurisdiction or with respect to the proper venue of any such
action, suit or proceeding in any such court.
8.7 Severability.
------------
In the event any provision of the Agreement is held to be invalid or
unenforceable, the remaining provisions of this Agreement will remain in full
force and effect.
8.8 Export.
------
Licensee and its Resellers agree to comply fully with all relevant export
laws and regulations of the United States to assure that neither the Licensed
Software, nor any direct product thereof, is exported, directly or indirectly,
in violation of United States law.
8.9 Waiver.
------
The waiver by either party of any default or breach of this Agreement shall
not constitute a waiver of any other or subsequent default or breach.
15
8.1 Entire Agreement.
----------------
This Agreement together with the Amended and Restated Mutual Reseller and
Alliance Agreement, dated the date hereof, the DSS Server Software License
Agreement, dated the date hereof, the Consulting Services Agreement, dated
August 29, 1997 and the Technology Purchase Agreement, dated August 29, 1997,
constitute the complete agreement between the parties and supersede all prior or
contemporaneous agreements or representation, written or oral, concerning the
subject matter of this Agreement. This Agreement may not be modified or amended
except in a writing signed by a duly authorized representative of each party; no
other act, document, usage or customer shall be deemed to amend or modify this
Agreement. All terms and conditions of any Licensee purchases order or other
ordering document shall be superseded by the terms and conditions or this
Agreement.
8.1 Construction.
------------
The Parties have participated jointly in the negotiation and drafting of
this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the Parties and no presumption or burden of proof shall arise favoring or
disfavoring any Party by virtue of the authorship of any of the provisions of
this Agreement.
8.1 Counterparts.
------------
This Agreement may be executed in any number of counterparts, each of which
shall be an original and all of which shall constitute together but one and the
same document.
16
RED BRICK SYSTEMS, INC. ENGAGE TECHNOLOGIES, INC.
By: /s/ X X Xxxxxxxxx By: /s/ Xxxxxxx X. Royal
----------------------------- -------------------------------------
Name: Xxxxxx X. Xxxxxxxxx Name: Xxxxxxx X. Royal
-------------------------- ----------------------------------
Title: EVP/COO Title: CFO
-------------------------- ----------------------------------
Red Brick Systems, Inc. Engage Technologies, Inc.
000 Xxxxxxx Xxx 000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxx, XX 00000 Xxxxxxx, XX 00000
Tel: 000-000-0000 Tel: 000-000-0000
-----------------------------------
Fax: 000-000-0000 Fax: 000-000-0000
-----------------------------------
CMG INFORMATION SERVICES, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Name:____________________________________
Title:___________________________________
CMG Information Services, Inc.
000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Tel:_____________________________________
Fax:_____________________________________
17
EXHIBIT 1: DEFINED TERMS
-------------------------
The following terms as used in Agreement shall have the meanings set forth
below:
"Application Suite" means (i) the current or future version of Licensee's suite
of Internet-based applications designed to collect, characterize, classify,
combine and analyze Internet data and currently known by the trade names:
Engage.Journal(TM), Engage.Portrait(TM) and Xxxxxx.Xxxx(TM)-API, and currently
being developed under the names DSS Server and Profile Server, or (ii) any other
product, technology or service that is proprietary, in whole or in part, to
Licensee and used or useful in the Clickstream Market.
"Application Suite Components" are one or more components of any Application
Suite, each of which incorporates Updates of the Licensed Software received by
Licensee after the Royalty-Free Period.
"Clickstream Market" means any market for any products or services primarily
designed to collect, characterize, classify, combine and analyze user or user
"agent" (i.e., a device or process that acts on a user's behalf) activity data
(including, without limitation, clickstream data) created, gathered, analyzed,
manipulated or otherwise processed through or in association with any form of
Interactive Media.
"Database Technology" means the source code and object code form of the Database
Technology acquired by Red Brick under the separate Technology Purchase
Agreement dated August 29, 1997 including end user documentation, technical
specifications and programmer notes and all Updates, enhancements, modifications
and improvements thereto, and Derivative Works thereof, but excluding code that
is part of Licensee's rights under Section 3.1(c).
"Data Warehouse Market" means any market, excluding the Clickstream Market, for
products or services used for the collection, transformation, loading, storage,
management, retrieval, delivery or presentation of any data other than
clickstream data.
"Derivative Works" shall have the meaning set forth in 17 U.S.C. (S) 101.
"Fees" means Royalty Fees and Pass-Through Royalty Fees.
18
"Interactive Media" means communication media that allow users to input
information or participate, including, but not limited to, the Internet,
interactive television and interactive telephony.
"Updates" means all updates, enhancements, modifications and improvements,
including, but not limited to, preview releases, external alpha releases, beta
releases, controlled releases and general releases, to the Licensed Software (as
such term is defined in Section 1.6), and Derivative Works thereof, that Red
Brick makes commercially available and which are not identified on the Red Brick
Price List as a separate product and which are developed by Red Brick or its
contractors in source code form, including end user documentation, technical
specifications and programmer notes.
19
EXHIBIT 2: END USER TERMS
-------------------------
All of Licensee's or its Reseller's agreements with end users licensing the
Application Suite which incorporates a copy of the Licensed Software shall
contain terms at least as restrictive as those set forth in this Exhibit (except
to the extent that such terms are prohibited by law in certain jurisdictions, in
which case the affected terms shall be included in such jurisdictions in as
restrictive a form as they are allowed, with all unaffected terms being
unchanged):
1. Restrict use of the Application Suite to object code form for End User's
own internal use only;
2. Prohibit transfer or duplication of the Application Suite except for
temporary transfer in the event of CPU malfunction and a single backup or
archival copy;
3. Prohibit timesharing or rental of the Application Suite and prohibit
assignment of the Application Suite unless the assignee assumes in writing
all of the restrictions on the End User required under this Agreement;
4. Prohibit causing or permitting the reverse engineering, disassembly or
decompilation of the Application Suite;
5. Prohibit title from passing to the sublicensee or Reseller;
6. Disclaim Red Brick's and its licensors' liability for any damages, whether
direct, indirect, incidental or consequential arising from the use of the
Licensed Software or the Application Suite;
7. Require the sublicensee and/or Reseller, at the termination of the
sublicense, to discontinue use and destroy or return to the Licensee or
Reseller the Application Suite, including documentation and all archival or
other copies;
8. For copies of the Application Suite sublicensed for use in the United
States, prohibit transfer of the Application Suite outside the United
States; require the sublicensee to comply fully with all relevant export
laws and regulations of the United States to assure that neither the
Application Suite, nor any direct product thereof, are exported, directly
or indirectly, in violation of United States law;
9. If Licensee or its Resellers grants an End User License to the United
States government, the Application Suite shall be provided with "Restricted
Rights" and Licensee or its Reseller will place a legend, in addition to
applicable copyright notices, on the documentation, and on any media label,
substantially similar to the following:
20
"RESTRICTED RIGHTS LEGEND: Use, duplication, or disclosure by the U.S.
Government is subject to the restrictions set forth in subparagraph (c) of
the Commercial Computer Software--Restricted Rights clause of FAR 52.227-
19."
10. Specify Red Brick and its licensors as intended third-party beneficiaries
of Licensee's rights under any End User License Agreement.
21
EXHIBIT 3: FEES
---------------
In accordance with Section 2.5 of the Agreement, Licensee shall pay Red
Brick Royalty Fees based upon the following schedule:
Allocated Application Suite Revenue Percent due Red Brick as Royalty Fee
$0 to $2,000,000 10%
$2,000,001 to $7,000,000 7%
$7,000,001 to $25,000,000 5%
Greater than $25,000,000 3%
Where "Allocated Application Suite Revenue" means the aggregate annual revenue
net of returns and allowances recognized by Licensee from the sale,
licensing or distribution of the Application Suite Components incorporating
Updates received by Licensee after the Royalty-Free Period.
Royalty Fees are calculated on a graduated basis with the beginning balance
starting from zero each year. For example, if Allocated Application Suite
Revenue for Year 1 was $10 million, the Royalty Fee for Year 1 would be
calculated as follows: (.10 X $2,000,000) + (.07 X $5,000,000) + (.05 X
$3,000,000) = $700,000. In Year 2, the calculation would begin from $0 again.
Royalty Fees are calculated based on Total Annual Revenue, but are payable on a
quarterly basis in accordance with Sections 2.5.3 and 2.5.4 of the Agreement.
In addition to Licensee's obligation to pay Royalty Fees, Licensee shall have an
obligation, commencing on the Effective Date of this Agreement, to make Pass-
Through Royalty Fee payments to Red Brick in accordance with Section 2.5.2 of
the Agreement.
The parties hereto agree that revenue received by Licensee from the entire
Application Suite shall be fairly allocated between (i) the Application Suite
Components and (ii) those components of the Application Suite which do not
incorporate Updates of the Licensed Software received after the Royalty-Free
Period, such allocation to be based on the relative value of such Application
Suite Components and such other components to the End Users.
22
EXHIBIT 4:
----------
ADDITIONAL FEATURES FOR MODIFIED RED BRICK FORMATION
----------------------------------------------------
LICENSED MATERIALS
------------------
Multi-byte data internationalization of Red Brick Formation Flow Engine.
All database adapters to enable Oracle 8, Microsoft SQL Server and Informix
XPS to be sources and targets.
23
