EXHIBIT 10.6
[PROGINET LOGO]
OEM AGREEMENT
entered into between
PROGINET Corporation, a company established and incorporated under the laws of
the state of Delaware, U.S.A., having its principal place of business at ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ of America,
- hereinafter referred to as "PROGINET" -
and PARTNER, a company established and incorporated under the laws of
-------------- with its principal place of business at
-----------------------------------.
- hereinafter referred to as "PARTNER" -
PRELIMINARY REMARKS
WHEREAS, PROGINET has developed or otherwise lawfully acquired certain
proprietary computer programs, support services and trade secrets
including, but not limited to, PROGINET SOFTWARE, which is licensed
worldwide by PROGINET, its Subsidiaries and Distributors as defined
herein after;
WHEREAS, PARTNER has developed or otherwise lawfully acquired certain
proprietary computer programs, support services and trade secrets
including, but not limited to, OEM PRODUCT which is licensed worldwide
by PARTNER, its Subsidiaries and Distributors as defined hereinafter;
WHEREAS, PARTNER is interested to integrate the PROGINET SOFTWARE
software, with and in order to enhance OEM PRODUCT;
WHEREAS, PROGINET agrees to license to PARTNER, on a non-exclusive
basis, its PROGINET SOFTWARE to be integrated with OEM PRODUCT and to
be distributed worldwide by PARTNER through its direct and indirect
channels;
WHEREAS, PROGINET wishes that Services to Customers with regard to the
Product shall be performed by PARTNER;
WHEREAS, PROGINET agrees to provide all necessary information and
support to PARTNER, as provided for in this agreement, in order to
provide Services to Customers with regard to the Product;
WHEREAS, PARTNER and/or its Distributors desire to distribute the
Product worldwide and to provide Services for the Product worldwide.
NOW THEREFORE, in consideration of the covenants and mutual promises,
terms and conditions set forth hereinafter, as well as other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1.
DEFINITIONS
In this OEM Agreement, the following terms shall have the following
respective meanings:
1. "PARTNER" shall mean PARTNER, its employees, contractors,
consultants and all its Subsidiaries worldwide.
2. "OEM PRODUCT" shall mean the PARTNER Products.
3. "CUSTOMER" shall mean any end-user of the Product distributed
by PARTNER or Distributors.
4. "Distributor" shall mean any third party who is granted a
sublicense by PARTNER and who may license copies of the
Product and/or who may provide Services to Customers.
5. "Documentation" shall mean end-user manuals, programmers
guides, educational materials, product descriptions and
specifications, technical manuals, supporting materials, and
all systems guides which are distributed in print, magnetic,
electronic, or video format, in connection with PROGINET
SOFTWARE and/or the Services.
6. "Revenue" shall mean all monies due and payments resulting
from licensing and/or maintenance of the Product, or from
Services.
7. "Product" shall mean the PROGINET SOFTWARE as integrated with
OEM PRODUCT distributed by PARTNER and/or its Distributors.
8. "PROGINET SOFTWARE" shall mean the one or all of the following
separate software products developed or otherwise lawfully
acquired by PROGINET:
SECURPASS a password management solution. Platforms
supported are: OS/390, Windows 95,98,NT, UNIX,
NetWare.
FUSION FTMS a data movement solution. Platforms
supported are: OS/390, Windows 95,98,NT, OS/2, Dec
VAX, UNIX, NetWare.
CYBERFUSION an Internet File Transfer solution.
Platforms supported are: OS/390, Windows 95,98,NT.
This OEM AGREEMENT pertains only to the --------------
solution developed or otherwise lawfully acquired by PROGINET,
regardless of whether it will be delivered under the name
"PROGINET SOFTWARE" or any other name.
9. "SERVICES" shall mean any services, including training,
development, support, and consulting, to be provided by
PARTNER and/or Distributors to Distributors and/or Customers
with regard to the Product.
10. "SOURCE CODE" shall mean the human-readable form of the
Product and the soft copy of all technical documentation of
any version, release or update of any computer program, that
must be converted into machine readable language by the use of
compilers, assemblers and/or interpreters and which includes
codes that have been compiled but require linking to binary
code in order to be machine readable. Source Code must include
sufficient information such that it can be used to provide the
software and Services to Customers.
11. "SUBSIDIARY" shall mean any legal entity as to which PROGINET
has the actual control now or hereafter, whereby "control"
shall mean the ability to determine the policies of such
company, whether resulting from a stock or a share ownership
or by other means, generally, but not limited to, holding a
majority of the stock or shares of such Subsidiary.
12. "USER" A user is defined by accounts on platforms that have
the ability to have their passwords reset by means of the
product.
2. GRANT OF RIGHTS
1. PROGINET hereby grants to PARTNER the non-exclusive,
non-transferable, but worldwide right to
a) create ancillary, supplemental and derivative works
with regard to PROGINET SOFTWARE and its
Documentation, and to integrate and package PROGINET
SOFTWARE with OEM PRODUCT, and to integrate, package,
modify and make excerpts from the Documentation into
other support material and documentation, under the
sole responsibility of PARTNER. PARTNER shall be the
sole proprietor of all works prepared by PARTNER,
exclusive of any works and products that are now
owned or developed by PROGINET.
b) distribute, sell, promote, demonstrate, reproduce,
license, lease, rent, publicly display, publicly
perform and create ancillary, supplemental and
derivative works related to the Products as well as
the Products' documentation or portions thereof,
through itself and/or its Distributors to
Distributors and/or Customers to use, display,
perform and copy for safeguard purposes, in any
medium and on any platform now known or later
developed. All such use and distribution is subject
to the terms, as specified, in this OEM Agreement.
2. PARTNER shall be entitled to use PROGINET SOFTWARE for its
internal purposes, for development, maintenance, training, and
demonstration purposes free of charge. Proginet shall be
entitled to use OEM PRODUCT for its internal purposes, for
development, maintenance, training, and demonstration purposes
free of charge.
3. PARTNER shall not be entitled to distribute PROGINET SOFTWARE
in its non-integrated form.
4. PARTNER shall be entitled to modify the existing Documentation
and/or to prepare newly developed documentation with regard to
the Product and to incorporate such documentation into
PARTNER's formatted sales, marketing and documentation
materials.
5. PARTNER may, distribute the Product under its own trademarks
and/or trade names. PARTNER shall provide notices related to
PROGINET's ownership and trademarks during the initialization
of the Product, and in such other places, if any, to insure
reasonable protection of PROGINET marks. The parties are to
inform each other of any such changes of trademarks and/or
trade names.
6. PARTNER will provide adequate disclosure in its Sales License
Agreement with customers, of inclusion of Proginet's software
in the licensed product related to proprietary ownership by
Proginet.
3. SUPPORT AND MAINTENANCE
1. PROGINET agrees to deliver to PARTNER one master copy of all
PROGINET SOFTWARE components and all future PROGINET SOFTWARE
releases, versions, updates, and upgrades developed hereafter
on electronic media and format as well as one master copy of
the Documentation on electronic media, during the life of this
OEM Agreement. PARTNER will provide all support to customers
for the licensed software.
2. Support Services will be provided for those licensees who have
fully paid all license and support fees due. PROGINET agrees
to provide maintenance and support services, over the phone,
24 hours/seven days a week, to PARTNER to the extent necessary
to provide promptly the Services to Distributors and/or
Customers as follows:
Error Severity Levels Of Service
PROGINET shall exercise commercially reasonable efforts to
correct any software defects reported by licensee in the
current or previously released and unmodified release of the
PROGINET SOFTWARE- in accordance with the priority level
reasonably assigned to such software defect. The service
levels are as follows:
SEVERITY "1" ISSUES, are assigned to a system which is not
operational and the licensee is prepared to turn requested
documentation over to the Support staff for resolution. For
severity 1 issues the PARTNER staff, and licensee staff must
be willing to work around the clock with PROGINET staff to
resolve the problem.
SEVERITY "2" ISSUES, are assigned when software is not in
complete failure, but is failing often and the failures are
having a high impact on the licensee's ability to do work.
SEVERITY "3" ISSUES, are assigned to problems which do not
affect the licensee's ability to essentially conduct normal
business activities. Delayed action by support resources is
appropriate, with a solution provided at a future time
convenient to the licensee and PROGINET.
Exclusions
PROGINET shall have no obligation to support:
a) altered, damaged or modified licensed software:
b) licensed software that is not the then current or
previous Sequential Release;
c) licensed software problems caused by licensee's
negligence, abuse or misapplication, or other causes
beyond the control of Proginet; or
d) Licensed Software installed on any Platform which is
not supported by PROGINET SOFTWARE. See Section 1.
DEFINITIONS for supported platforms by Product. These
platforms will be amended as platform support changes
occur.
3. Any additional training of Services related to the Product not
covered by paragraph 2 herein before shall be provided for by
PROGINET to PARTNER and/or its Distributors, upon PARTNER's
request, at PROGINET's most competitive standard pricing.
4. First and Second Level Customer Support will be provided by
PARTNER for the licensee.
4. ROYALTIES AND PAYMENT
1. PARTNER agrees to pay to PROGINET a royalty fee based upon the
schedule included herein as Enclosure 1.
2. For this purpose, PARTNER agrees to submit to PROGINET a copy
of each license and/or maintenance agreement entered into by
PARTNER, within 5 (in words: five) days of receipt of such
signed agreement
3. PARTNER agrees to submit to PROGINET a copy of each license
and/or maintenance agreement entered into by PARTNER, within
10 (in words: ten) days of receipt of such signed agreement.
4. PARTNER agrees to furnish PROGINET with a statement of
PROGINET SOFTWARE royalties on a quarterly basis within 10 (in
words: ten) days following the end of each calendar quarter
setting forth the payments made and due to PROGINET during the
preceding calendar quarter.
5. PROGINET agrees to inspect the statement of royalties in due
course and agrees to report to PARTNER in writing any
objections within 10 (in words: ten) days.
6. All payments to be made by PARTNER to PROGINET should be due
and payable within 5 (in words: five) days after receipt of
payment. If PARTNER is in default with any undisputed payment
or any payment as to which a final and binding judgment has
been entered into, PARTNER agrees to the payment of an
interest rate of 1.5% (in words: one and one half percent) per
month as a contractual penalty. All disputed payments
eventually determined to be due and payable to PROGINET are
subject to the rate as defined above.
7. Payments that are not received by PARTNER from the contractual
partner that are more than 90 (in words: ninety) days late,
will be made by PARTNER to PROGINET within 5 (in words: five)
business days after the ninety day period expires.
8. All payments to be made shall be in US Dollars. Such funds are
to be remitted via wire transfer as follows:
Wire Transfer Instructions:
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Company Name: PROGINET Corp.
Bank Name: Citibank N.A.
Bank Address: ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇
▇▇▇
Account Number: 234 14 118
Bank ABA Number: ▇▇▇▇▇▇▇▇▇
{also known as
Routing Number}
Bank ABA Number: ▇▇▇▇▇▇▇▇▇
(also known as
Routing Number)
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5. MARKETING/SALES RESPONSIBILITIES
1. PARTNER will be responsible for all the effort and investment
for the marketing promotion and sales of the mainframe reset
module based on the licensed technology. PARTNER agrees to
provide Proginet copies of all prepared materials within two
weeks of such material(s) being prepared.
6. TRAINING, JOINT DEVELOPMENT AND SERVICES
1. PROGINET agrees to provide to PARTNER an initial training
package encompassing a 2 (in words: two) days training on
PROGINET SOFTWARE for PARTNER and/or its Distributors or
PARTNER's developers. This initial training pack will be
provided by PROGINET at no charge, except all out of pocket
expenses, actually incurred will be paid by PARTNER.
2. Any additional training shall be provided by PROGINET at a 33%
discounted rate off of PROGINET's standard rate (currently
$2,000 per day), per day, plus out of pocket expenses.
3. PROGINET and PARTNER agree to make specific functionality
enhancements to the product as mutually agreed. These
enhancements will have detailed specifications and be
completed in a timely manner as documented separately in
writing, from time to time. This specifications document must
be completed and approved by both parties.
4. PROGINET will provide consulting services and support to
assist customer deployment when requested; provided that such
services have been scheduled and approved in advance. Rates
will be as defined in the fee schedule attached to this
agreement.
7. WARRANTIES AND REPRESENTATIONS
1. PROGINET represents and warrants that PROGINET SOFTWARE as
well as any information submitted by PROGINET in this regard
is substantially free of defects and substantially has the
promised qualities and is performing in all material aspects
according to the Documentation.
2. PROGINET represents and warrants that PROGINET SOFTWARE is
free and clear of any liens or encumbrances.
3. PROGINET represents and warrants that PROGINET SOFTWARE is
Year 2000 Compliant and that the use of any date prior to,
during and after the year 2000 does not affect the performance
or functionality of PROGINET SOFTWARE whatsoever, pursuant to
PROGINET's "Definition of Year 2000 Compliance" attached as
follows:
The definition of year 2000 Compliance implies that neither
performance nor functionality is affected by dates prior to,
during and after the year 2000.
In particular:
RULE 1: No value for current date will cause any interruption
in operation.
RULE2: Date-based functionality must behave consistently for
dates prior to, during and after year 2000.
RULE3: In all interfaces and data storage, the century in any
date must be specified either explicitly or by unambiguous
algorithms or inferencing rules.
RULE 4: Year 2000 must be recognized as a leap year.
4. Except as specifically provided otherwise in this OEM
agreement, PROGINET does not provide any other warranties or
representations.
5. PROGINET agrees to indemnify PARTNER to the full extent,
including reasonable attorneys fees, from any claims brought
against PARTNER, its employees, contractors, consultants, and
Distributors, of any third party in connection with any defect
of PROGINET SOFTWARE for a proven infringement of any patent
or copyright rights relating to PROGINET SOFTWARE.
6. PARTNER agrees to indemnify PROGINET to the full extent,
including reasonable attorneys fees, from any claims brought
against PROGINET, its employees, contractors, consultants, and
Distributors, of any third party in connection with any defect
of OEM PRODUCT for a proven infringement of any patent or
copyright rights relating to OEM PRODUCT.
7. The statute of limitations with regard to any claims of
PARTNER against PROGINET shall expire within 6 (in words: six)
months after PARTNER obtained actual knowledge of its claim.
8. The statute of limitations with regard to any claims of
PROGINET against PARTNER shall expire within 6 (in words: six)
months after PROGINET obtained actual knowledge of its claim.
8. INTELLECTUAL PROPERTY RIGHTS/INFRINGEMENT
1. Both parties recognize the intellectual property rights, such
as patents, trademarks, copyrights, trade secrets etc. of the
respective other party.
2. PARTNER agrees to include a notice regarding PROGINET's
copyrights and/or trademarks to protect PROGINET's proprietary
information consistent with applicable standards in the
respective market.
3. PARTNER shall be solely entitled to any intellectual property
rights resulting from the preparation of the Product developed
by PARTNER, its employees, contractors and consultants.
PROGINET shall be solely entitled to all intellectual property
rights resulting from the preparation of PROGINET SOFTWARE
developed by PROGINET, its employees, contractors, and
consultants.
4. PROGINET represents and warrants that PROGINET is the legal
proprietor of PROGINET SOFTWARE and that PROGINET has full
rights, title and interest, including the right to grant the
licenses herein, and that PROGINET SOFTWARE does not infringe
any patent, trademark, copyright, trade secret or other
proprietary right whatsoever worldwide.
5. Cure. As soon as Proginet or PARTNER has reason to believe a
Claim is likely to be made against PARTNER, its customers or
any of its subsidiaries, Proginet shall, promptly and at its
sole expense, use its best efforts to settle, avoid, or
otherwise cure the Claim by one of the following procedures:
1) Obtain a license for PARTNER, its customers and its
subsidiaries to continue using PROGINET SOFTWARE in
accordance with this Agreement.
2) Modify PROGINET SOFTWARE to make it non-infringing, while
maintaining the equivalent or better functionality,
features, and performance.
3) Replace PROGINET SOFTWARE with a non-infringing product,
either from Proginet or another supplier, having the
equivalent or better functionality, features and
performance.
6. Cancellation of License. If, despite its best efforts to do
so, Proginet is unable to effect a cure under the paragraph
entitled "Cure" of this clause, and a permanent injunction
ordering PARTNER, its customers or its subsidiaries to cease
further use of the goods is issued by a court of competent
jurisdiction, either party may cancel the purchase contract
under which the goods were ordered, either in whole or in
part, whereupon PARTNER and its subsidiaries may return all or
any portion of the Goods to Proginet for a full refund; and
either party may terminate this Agreement. Any license granted
under this Agreement with respect to the returned software
will terminate as of the effective date of the cancellation.
9. CONFIDENTIALITY
1. Both parties agree to keep confidential any and all
information received directly or indirectly from the other
party, orally or in writing, including the terms and
provisions of this OEM Agreement, provided the party receiving
this information can reasonably presume that the information
is to be dealt as confidential and/or the information is
specifically stated as being confidential.
2. The duty of confidentiality shall not include any information,
which is now or hereafter in the public domain, which
information is already legally in the possession of the
receiving party, which information has been independently
developed by the receiving party and which information has
been disclosed by a third party without breach of any
obligation of confidentiality.
10. ESCROW
1. PROGINET agrees to deposit and maintain copies of the Source
Code of PROGINET SOFTWARE and all its components thereof,
including all future modifications, promptly with its escrow
agent, in which case fees are to be paid by PARTNER, and / or
licensee.
2. PARTNER agrees to deposit and maintain copies of the Source
Code of any products developed or integrated with of PROGINET
SOFTWARE and all its components thereof, including all future
modifications, promptly with its escrow agent.
3. The Escrow Agent will release a copy of the source code, only
after receiving written instruction from PROGINET, or
PROGINET's trustee in a bankruptcy or Chapter 11 proceeding.
PROGINET will grant the Escrow Agent the irrevocable right to
duplicate the software to provide a copy as authorized in the
Escrow Agreement.
11. RELATIONSHIP BETWEEN THE PARTIES
Each party is acting as an independent contractor and not as an agent,
partner, or joint venture of the other party for any purpose. Except as
provided in this OEM agreement neither party shall have any right,
power or authority to act or to create any obligation, expressed or
implied, on behalf of the other party.
12. TERM AND TERMINATION
1. This OEM Agreement shall commence after being signed by both
parties and shall be concluded for a period of 2 (in words:
two) years from the date of signing. It shall then be extended
for further periods of 1 (in words: one) year each, provided
it is not terminated by either party with 3 (in words: three)
months notice prior to the termination date.
2. Each party shall have the right to terminate this agreement
for good cause, particularly if the other party does not
comply with substantial duties under this OEM agreement, as
well as, but not limited to, if any substantial obligation of
this OEM agreement has been breached, and bankruptcy
proceedings have been adjudicated or if a liquidator has been
appointed over the assets of one party.
4. The termination shall be made in writing in accordance with
Article 14.
5 All licenses granted with regard to the Product during the
term of this OEM agreement, as well as all obligations,
including royalty payments with respect thereto, shall survive
any termination of this OEM agreement, excepting that the
licenses granted to PARTNER in section 2.2 will terminate.
13. LIMITATION OF LIABILITY
Except for claims arising under the clauses entitled "Intellectual
Property Rights/Infringement" in no event shall either party have any
liability to the other party, whether based on contract, tort
(including but not limited to strict liability and negligence), or any
other legal or equitable grounds, for any loss of use, profit, or
revenue by the other party, or for any indirect, consequential,
special, or punitive damages incurred or suffered by the other party,
arising out of or related to this agreement, even if that party has
been advised of the possibility of such loss or damages. Claims by
either party for contribution from the other party for third-party
injury, damage, or loss are not waived, released, or disclaimed.
14. MISCELLANEOUS
1. This OEM agreement contains the complete and entire agreement
between the parties and supersedes any previous communication,
representation or agreement, whether verbal or written.
2. All notices shall be in writing and given by personal
delivery, certified mail, return receipt requested, or by
commercial overnight courier for next business day delivery,
to the recipient's address set forth above. Notice shall be
deemed given the date of personal delivery, the fifth business
day after mailing, or the next business day after delivery to
such courier (unless the return receipt or the courier's
records evidence a later delivery).
3. If any part of this agreement is rendered void, unenforceable
or incomplete, this shall not affect the validity of the
remainder of this agreement. The parties agree in this case to
replace the void, unenforceable or incomplete provision by a
clause representing the economically intended purpose as
closely as possible and which they would have agreed upon if
they had actual knowledge that this specific provision was
void, unenforceable or incomplete.
4. This agreement shall be exclusively governed by the Laws of
the United States, in the State of New York.
5. Any dispute resulting out or in connection with this OEM
agreement shall be subject to the exclusive jurisdiction and
shall finally be settled by arbitration through the means of
the American Arbitration Association.
6. This agreement and the licenses granted herein, may not be
assigned, delegated, sublicensed or transferred by either
party, without the prior written consent of the other party.
Such consent shall not be unreasonably withheld. In the case
of a successor company carrying on substantially the same
business in connection with a merger, purchase of assets of
other reorganization, this agreement and licenses herein will
be transferred.
7. Neither party shall use the name of the other party in any
news release, public announcement, advertisement, or other
form of publicity without securing the prior written consent
of the other.
8. Either party's failure to exercise any of its rights under
this Agreement shall not constitute a waiver of any past,
present, or future right or remedy.
15. SIGNATURES
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PARTNER Proginet Corporation
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Place
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Date:
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Signature
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Name:
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Title
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ENCLOSURE 1 PROGINET SOFTWARE PRICING
See Proginet's Price List, attached.
