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Exhibit 10.2
MARKETING AND DISTRIBUTION AGREEMENT
This marketing and distribution agreement ("Marketing Agreement") is made as of
December ___, 1998 ("Effective Date") by and between PeopleSoft, Inc.
("PEOPLESOFT"), a Delaware corporation having its principal place of business at
0000 Xxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxxx 00000 and Momentum Business
Applications, Inc., ("Momentum") a Delaware corporation having its principal
place of business at 0000 Xxxxxx Xxx Xxxxxxxxx, Xxxxxxx Xxxxxxxxxx 00000.
Whereas the parties have entered into a development and license agreement (the
"DEVELOPMENT AGREEMENT") pursuant to which PeopleSoft has licensed PeopleSoft
Technology to Momentum for the development by Momentum of certain products,
including electronic business applications, analytic applications and
industry-specific applications; and
Whereas, the parties desire to set forth the various marketing and support
requirements for the marketing and distribution of the Momentum Products by
PeopleSoft as set forth herein.
The parties agree as follows:
1. DEFINITIONS
"Development Costs" means the costs incurred by Momentum in developing any
Momentum Product.
"Developed Technology" shall have the meaning assigned to it in the
Development Agreement.
"Documentation" shall have the meaning assigned to it in the Development
Agreement.
"End User" means any end customer using the Momentum Products.
"Enhancement Costs" means the fully burdened costs (including any costs
incurred for third party contractors hired by PeopleSoft) that PeopleSoft
incurs in the course of developing enhancements, fixes, updates or
improvements which improve the functionality, utility, performance and/or
operation of a Licensed Product.
"Excluded Parties" means those entities that, at the end of the License
Option Term, PeopleSoft reasonably believes are competitors of PeopleSoft.
PeopleSoft shall provide a list of Excluded Parties to Momentum at such
time.
"First-Line Support" means only the routing of Momentum Products technical
support telephone inquiries to the Second-Line Support organization.
First-Line Support includes responsibility for handling all PeopleTools
technical support inquiries received from End Users.
"Generally Available Product" means a Momentum Product, which has
successfully completed PeopleSoft release testing (in accordance with
PeopleSoft's then current PeopleSoft release model) with the level of
functionality specified in such product's work plan and which becomes
commercially available for production use.
"License Option" means PeopleSoft's right to acquire an exclusive license
for the commercialization of a Momentum Product pursuant to the section
entitled "License Option" hereof.
"License Option Term" means the period from which a work plan for a product
is approved by Momentum pursuant to the Development Agreement until the end
of the earlier of (i) the thirtieth (30th) day after such Momentum Product
becomes a Generally Available Product or (ii) the expiration of the
Purchase Option.
"Licensed Product" means a Momentum Product for which PeopleSoft has
exercised its License Option.
"Momentum Products" shall have the meaning assigned to it in the
Development Agreement.
"Net License Fees" means the actual amount of license fees received by
PeopleSoft, either from an End User or from a third party reseller, for an
end user's use of a Momentum Product or Licensed Product and any Upgrades
and Updates thereto, less sales, technology witholding or VAT taxes,
imputed fees for Support Services (such as bundled maintenance and
training), and any third party royalties.
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"Net Revenues" means the aggregate amount of Net License Fees received by
PeopleSoft during any given calendar quarter, less the Enhancement Costs
related to the Momentum Product which are incurred by PeopleSoft during
that same quarter.
"PeopleSoft Technology" shall have the meaning assigned to it in the
Development Agreement.
"PeopleTools" shall have the meaning assigned to it in the Development
Agreement.
"Pre-Release License" means the license granted by Momentum to PeopleSoft
in the section entitled Pre-Release Marketing and Distribution License/
Responsibilities.
"Pre-Release Royalty" means the royalties payable by PeopleSoft as set
forth in Exhibit A (section 2) for any Momentum Product commercialized by
PeopleSoft prior to the exercise of the License Option.
"Pre-Release Term" means the period from which a work plan for a product is
approved by Momentum pursuant to the Development Agreement until the
earlier of (1) PeopleSoft's exercise of the License Option, or (2) the end
of the License Option Term.
"Pricing Addendum" means the separately executed addendum to this Marketing
Agreement which states the commercial terms of this Agreement. The Pricing
Addendum is attached as Exhibit A and is hereby incorporated herein as part
of this Marketing Agreement.
"Product Payments" means the royalties payable by PeopleSoft as set forth
in Exhibit A (section 3(a)) for any Licensed Product.
"Purchase Option" means PeopleSoft's option to acquire all (but not less
than all) of the outstanding Class A Common Stock of Momentum as set forth
in Momentum's Restated Certificate of Incorporation.
"Second-Line Support" means the general level of Support Services without
First-Line Support obligations.
"Support Services" means PeopleSoft's then current technical support and
maintenance services for the PeopleSoft Technology. Support Services for
general customers as of the Effective Date are as set forth in Exhibit B
attached hereto.
"Term" shall mean the exercise or expiration of the Purchase Option.
"Upgrade" means the right to use the Momentum Products on a designated
computer with increased processing power or an increase in the number of
users to the next pricing increment and generally in each case a
requirement for a payment of applicable Upgrade fees to PeopleSoft.
"Updates" means one (1) copy of all published revisions and corrections to
the printed documentation and one (1) copy of corrections and new releases
of the Momentum Products.
2. PRE-RELEASE MARKETING AND DISTRIBUTION LICENSE/ RESPONSIBILITIES
2.1 For the Pre-Release Term, Momentum grants to PeopleSoft the exclusive
license to market and distribute pre-release versions of the Momentum
Products to any End Users through its then current worldwide channel
distribution system under the PeopleSoft name or otherwise pursuant to
PeopleSoft's then current general licensing policies and
methodologies. PeopleSoft shall use commercially reasonable efforts to
promptly market and distribute such pre-release versions of Momentum
Products to select customers in accordance with its standard
practices. Any customers licensed by PeopleSoft during the Pre-Release
Term must be reasonably acceptable to Momentum.
2.2 PeopleSoft shall have the right to use a reasonable number of copies
of the Momentum Products, at no royalty to Momentum, for training,
marketing, sales and support purposes.
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2.3 PeopleSoft shall have complete responsibility, at its expense, for all
marketing, pre-sales and sales activities associated with the Momentum
Products.
2.4 PeopleSoft shall establish all then-current commercially reasonable
local country suggested list prices for the Momentum Products and
associated services.
3. ROYALTIES/PAYMENTS FOR PRE-RELEASE TERM
3.1 For each pre-release copy of Momentum Products licensed by PeopleSoft
to an End User, PeopleSoft shall pay Momentum a royalty (the
"Pre-Release Royalty") as set forth in the Pricing Addendum.
PeopleSoft may license a reasonable number of royalty-free copies of
the Momentum Products for End User evaluation purposes.
3.2 PeopleSoft shall pay to Momentum all royalties and fees due to
Momentum under this Marketing Agreement within forty-five (45) days of
the end of the calendar quarter in which the Net Revenues are recorded
by PeopleSoft.
4. SUPPORT SERVICES FOR PRE-RELEASE TERM
4.1 Momentum and PeopleSoft shall work together to provide joint
post-sales support to End Users. Momentum shall provide limited Second
Line Support for the Momentum Products through its Contract
Developers.
4.2 PeopleSoft shall provide all support for PeopleTools to End Users,
commensurate with PeopleSoft's then current standard Support Services
terms and conditions. A copy of the Support Services terms and
conditions as of the Effective Date is included as Exhibit B.
4.3 PeopleSoft shall provide the End User with First-Line Support for the
Momentum Products and shall retain all associated support revenues.
PeopleSoft's responsibility to provide Updates and enhancements to End
Users is limited only to the distribution of any releases, Updates and
enhancements provided to PeopleSoft by Momentum, as well as the
distribution to End Users of any new releases, Updates or enhancements
of PeopleTools.
5. SUPPORT SERVICES FEES FOR PRE-RELEASE TERM
5.1 As of the Effective Date, PeopleSoft incorporates the first year of
Support Services fees into the license fee. Currently, Support
Services fees are listed at eighteen percent (18%) of the software
license fee.
5.2 As set forth in Exhibit A, PeopleSoft shall retain all revenues from
the provision of Support Services, which are detailed more completely
in Exhibit B.
6. LICENSE OPTION
6.1 Momentum hereby grants to PeopleSoft a License Option to acquire a
license to exclusively commercialize each Momentum Product . This
License Option shall be exercisable on a worldwide basis at any time
during the License Option Term. Upon exercise of the License Option,
PeopleSoft shall obtain a perpetual, exclusive license (with the right
to sublicense through multiple tiers of sublicensors) to develop,
make, have made, use, support, market, enhance and distribute the
Licensed Product subject to the obligation to make Product Payments as
set forth in Exhibit A (section 3 (a)) hereto. PeopleSoft shall also
have the right to buyout the Product Payments as set forth in Exhibit
A (Section 3 (b)).
6.2 Upon exercise of the License Option with respect to a Momentum
Product, sections 2, 3, 4 and 5 above shall no longer apply with
respect to such Momentum Product and PeopleSoft shall assume sole and
full responsibility for any product development, support, training,
consulting, bug fixes, modifications and enhancements with respect to
the Licensed Product.
6.3 At the end of the License Option Term for a Momentum Product, if
PeopleSoft has not exercised its License Option with respect to said
Momentum Product, (1) PeopleSoft shall grant to Momentum a perpetual,
nonexclusive license to market, distribute and sublicense the
PeopleSoft Technology, only to the
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extent incorporated into such Momentum Product, to all third parties
that are not then Excluded Parties, subject to the terms and
conditions of PeopleSoft's then-standard end user license agreement.
The royalty rate payable by Momentum to PeopleSoft for such
distribution shall be substantially similar to PeopleSoft's then
current royalty rates which PeopleSoft receives from third parties
marketing PeopleSoft Technology; and (2) Momentum shall grant to
PeopleSoft a perpetual, royalty-free, non-exclusive license to (a)
license the then most recent version of such Momentum Product, and any
new releases, Updates or enhancements thereto, to any End Users
granted licenses by PeopleSoft pursuant to the Pre-Release License,
and (b) use a reasonable number of copies of Momentum Products and any
new releases, Updates or enhancements thereto, for internal use,
training and support purposes.
7. DISTRIBUTION LIMITATION
Regardless of whether PeopleSoft exercises the License Option, PeopleSoft
warrants that it will not, without the prior written consent, if required,
of the U.S. Department of Commerce, export directly or indirectly Momentum
Products to any prohibited country specified in then current U.S.
Department of Commerce Export Administration Regulations.
With regard to the license grant in section 6.3(2) above, Momentum warrants
that it will not, without the prior written consent, if required, of the
U.S. Department of Commerce, export directly or indirectly PeopleSoft
Technology incorporated into Momentum Products to any prohibited country
specified in then current U.S. Department of Commerce Export Administration
Regulations.
8. LICENSE TO USE MOMENTUM TRADEMARKS AND TRADENAMES
Regardless of whether PeopleSoft exercises the License Option, Momentum
provides to PeopleSoft a royalty-free license to use Momentum's tradenames
and trademarks which relate to the Momentum Products in connection with
PeopleSoft's distribution of the Momentum Products or marketing materials
associated with this Marketing Agreement, provided PeopleSoft clearly
identifies Momentum's ownership of such names or marks.
9. TERM
9.1 This Marketing Agreement shall expire at the Term.
9.2 This Marketing Agreement shall automatically terminate in the event
PeopleSoft acquires all ownership interest to Momentum.
10. RECORDS AND REPORTS/PAYMENTS
10.1 PeopleSoft shall keep full, true and accurate records and accounts in
accordance with generally accepted accounting practices to show the
amount of fees payable to Momentum. These records and accounts shall
include for each copy of Momentum Products distributed:
a. the name and address of the End User;
b. the date of shipment and receipt of payments from End Users;
c. the computation of the net licenses fee; and
d. a copy of each signed end user license agreement.
10.2 PeopleSoft shall keep these records at PeopleSoft's principal place of
business. Momentum shall have the right to conduct an audit of such
records once per calendar year upon the giving of at least five (5)
business days prior written notice to PeopleSoft to determine
PeopleSoft's compliance with this Marketing Agreement. Momentum shall
bear the expenses of the audit, however, in the event any such audit
reveals that PeopleSoft has understated the amount of fees that
PeopleSoft is obligated to pay Momentum under this Marketing Agreement
by more than five percent (5%), PeopleSoft shall pay, in addition to
any fees contractually due, all reasonable costs and fees associated
with the audit.
10.3 Forty Five (45) days after the end of each calendar quarter,
PeopleSoft shall develop, implement and provide Momentum with a
quarterly royalty report in accordance with its standard reporting
practices that is structured as a summary report with availability to
detailed backup information. The expectation is that
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key information concerning the Momentum Products module(s) licensed,
customer name, ship date, quantity, standard list price, actual fee
received, reductions for bundled services, Net License Fee and actual
royalty rate will be provided in the quarterly report provided to
Momentum. In addition, such report shall detail the computation of Net
Revenues, including the summarization of Net License Fees, and the
deduction of appropriate Enhancement Costs incurred during the
reporting period. The report shall also provide a summary of such
Enhancement Costs.
10.4 All payments shall be made in U.S. dollars.
11. TITLE AND PROTECTION / NON DISCLOSURE
11.1 All right, title and interest to the Momentum Products shall vest in
Momentum, subject to PeopleSoft's underlying right, title and interest
in and to the PeopleSoft Technology.
11.2 PeopleSoft shall affix, to any media containing a copy of all or any
portion of the Momentum Products and to each whole or partial copy of
documentation, all copyright, proprietary information notices and
restricted rights legends as were affixed to the original media or
documents. All Momentum Products Distributed to the federal government
shall contain the correct "Restricted Rights" legend as defined in
DFAR 52.227-7013 (c) (1) (ii) or pertinent subsequent citation.
11.3 Title to the physical media for the Momentum Products vests in
PeopleSoft upon delivery. The Momentum Products contains valuable
proprietary information, and other than as set forth herein,
PeopleSoft shall not disclose any such information to anyone other
than those of its employees or consultants under nondisclosure
obligations who have a need to know for purposes consistent with this
Marketing Agreement. PeopleSoft shall affix, to each full or partial
copy of Momentum Products made by PeopleSoft, all copyright and
proprietary information notices as affixed to the original.
11.4 All information (1) clearly marked "confidential" by either party
under this Marketing Agreement and provided to the other party, or (2)
which should reasonably be understood to be confidential in nature by
the receiving party, shall be treated as confidential and shall not be
disclosed, orally or in writing by the receiving party to any third
party without the prior written consent of the disclosing party.
12. LIMITED WARRANTY
12.1 Momentum represents that each of the Momentum Products does not
infringe any patent, copyright or other third party intellectual
property rights when used in accordance with the published
specifications for such Momentum Product. Momentum represents that
each of the Momentum Products and all subsequent major releases
thereon will perform substantially in accordance with the
corresponding documentation for such Momentum Product for a period of
one (1) year from the date of installation. Momentum does not
represent that any of the Momentum Products is error-free. In the
event that any of the Momentum Products does not perform substantially
in accordance with the published specifications for such Momentum
Product, Momentum's sole obligation is limited to repair or
replacement of such defective Momentum Product in accordance with its
then current support services terms and conditions, provided
PeopleSoft notifies Momentum of the deficiency within the one-year
period and provided PeopleSoft has installed all Momentum Products
updates provided by Momentum's support services.
12.2 MOMENTUM DISCLAIMS ALL OTHER REPRESENTATIONS OR WARRANTIES, EXPRESS OR
IMPLIED, INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
12.3 PeopleSoft represents that the PeopleSoft Technology does not infringe
any patent, copyright or other third party intellectual property
rights when used in accordance with the published specifications.
PeopleSoft represents that the PeopleSoft Technology and all
subsequent major releases thereon will perform substantially in
accordance with the corresponding documentation for a period of one
(1) year from the date of installation at Momentum. PeopleSoft does
not represent that the PeopleSoft Technology is error-free. In the
event the PeopleSoft Technology does not perform substantially in
accordance with the published specifications, PeopleSoft's sole
obligation is limited to repair or replacement of the defective
PeopleSoft Technology in accordance with its then current Support
Services terms and conditions,
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provided Momentum notifies PeopleSoft of the deficiency within the
one-year period and provided Momentum has installed all PeopleSoft
Technology updates provided by PeopleSoft's Support Services.
12.4 PEOPLESOFT DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE
13. DISCLAIMER OF CONSEQUENTIAL DAMAGES / LIMITATION OF LIABILITY
13.1 NEITHER PARTY WILL BE LIABLE TO THE OTHER FOR INDIRECT, INCIDENTAL,
SPECIAL, OR CONSEQUENTIAL DAMAGES, INCLUDING BUT NOT LIMITED TO LOST
DATA OR LOST PROFITS, HOWEVER ARISING, EVEN IF IT HAS BEEN ADVISED OF
THE POSSIBILITY OF SUCH DAMAGES.
13.2 EXCLUDING DAMAGES INCURRED UNDER THE ARTICLE ENTITLED
"INDEMNIFICATION", EACH PARTY'S LIABILITY FOR DAMAGES UNDER THIS
MARKETING AGREEMENT SHALL IN NO EVENT EXCEED THE AMOUNT OF ROYALTIES
THAT PEOPLESOFT HAS PAID TO MOMENTUM IN THE PRECEDING TWELVE (12)
MONTHS. THE PARTIES AGREE TO THE ALLOCATION OF LIABILITY RISK WHICH IS
SET FORTH IN THIS SECTION.
14. INDEMNIFICATION
14.1 Momentum shall indemnify and defend PeopleSoft against any claims that
the components of the Momentum Products (excluding PeopleSoft
Technology) infringes any patent, copyright or trade secret; provided
that Momentum is given prompt notice of such claim and is given
information, reasonable assistance, and authority to defend or settle
the claim. In the defense or settlement of the claim, Momentum may
obtain for PeopleSoft the right to continue using and marketing the
Momentum Products or replace or modify Momentum Products so that it
becomes noninfringing while giving substantially equivalent
performance. Momentum shall have no liability if the alleged
infringement is based on: (i) a modification of Momentum Products by
anyone other than Momentum or its subcontractors, if any; or (ii) the
use of the Momentum Products other than in accordance with the
documentation provided by Momentum.
14.2 PeopleSoft shall indemnify and defend Momentum against any claims that
the PeopleSoft Technology infringes any patent, copyright or trade
secret; provided that PeopleSoft is given prompt notice of such claim
and is given information, reasonable assistance, and authority to
defend or settle the claim. In the defense or settlement of the claim,
PeopleSoft may obtain for Momentum the right to continue using the
PeopleSoft Technology or replace or modify PeopleSoft Technology so
that it becomes noninfringing while giving substantially equivalent
performance. PeopleSoft shall have no liability if the alleged
infringement is based on: (i) a modification of PeopleSoft Technology
by anyone other than PeopleSoft; or (ii) the use of PeopleSoft
Technology other than in accordance with the Documentation.
15. DEFAULT
15.1 It shall be an event of default ifeither party (1) fails to perform
any of its material obligations (including any payment obligations)
under this Marketing Agreement or otherwise materially breaches this
Marketing Agreement and such material breach remains uncured for more
than thirty (30) days after receipt of written notice specifying the
material breach thereof, or (2) enters into any proceeding, voluntary
or involuntary, in bankruptcy, reorganization or similar arrangement
for the benefit of its creditors.
15.2 If an event of default occurs, the nondefaulting party in addition to
any other rights available to it under law or equity, may terminate
this Marketing Agreement by written notice to the defaulting party. In
the event this Marketing Agreement is terminated by PeopleSoft in
connection with Momentum's breach of a material obligation under this
Marketing Agreement, PeopleSoft shall be entitled to receive, as
liquidated damages, the Available Funds. If PeopleSoft reasonably
believes that such liquidated damages are inadequate, then PeopleSoft
will be entitled to specific performance of Momentum's obligations
under this Marketing Agreement in connection with such breach.
Remedies shall be cumulative and there shall be no obligation to
exercise a particular remedy.
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16. TERMINATION
16.1 Any licenses granted pursuant to Sections 6.1, 6.3 and 8 and any
sublicenses granted pursuant to Section 2.1 shall survive the
termination of this Agreement.
16.2 Within thirty (30) days of termination, PeopleSoft shall pay Momentum
all sums due under this Marketing Agreement.
16.3 Prior to termination, the parties shall meet, discuss and agree on a
transition plan to address technical support plans for existing End
Users and then-current commercially reasonable payments from Momentum
to PeopleSoft for continuing PeopleTools Support Services from
PeopleSoft directly to Momentum.
16.4 In addition to this section, the sections entitled "Distribution
Limitation," "Royalties/Payments," "Records and Reports/Payments,"
"Title and Protection / Non-disclosure," "Limited Warranty,"
"Disclaimer of Consequential Damages/Limitation of Liability," and
"Indemnification," shall survive termination of this Marketing
Agreement.
17. NOTICES
All notices shall be in writing and hand-delivered or sent by first class
mail, overnight mail, courier, or transmitted by facsimile (if confirmed by
such mailing), to the addresses indicated on the first page of this
Agreement, or such other address as either party may indicate by at least
ten (10) days prior written notice to the other party. Notices to
PeopleSoft shall be addressed to the Office of the General Counsel,
Corporate Legal Department.
18. GENERAL
18.1 This Marketing Agreement is made in and shall be governed by the laws
of the State of California, excluding choice of law principles. Any
actions brought to enforce any of the provisions of this Marketing
Agreement shall be fully and finally resolved by binding arbitration
under the rules of the American Arbitration Association conducted by a
mutually acceptable independent third party in San Francisco,
California.. Except for actions for breach of PeopleSoft's proprietary
rights in PeopleSoft Technology, or Momentum's proprietary rights in
the Momentum Products or Developed Technology, no action regardless of
form, arising out of this Marketing Agreement may be brought by either
party more than one year after the cause of action has accrued.
18.2 The section headings herein are provided for convenience only and have
no substantive effect on the construction of this Marketing Agreement.
If any provision of this Marketing Agreement is held to be
unenforceable, this Marketing Agreement shall be construed without
such provision.
18.3 The failure by a party to exercise any right hereunder shall not
operate as a waiver of such party's right to exercise such right or
any other right in the future. Neither party shall be liable to the
other for any failure to perform due to causes beyond its reasonably
foreseeable control.
18.4 Neither party shall assign this Marketing Agreement, delegate any duty
or assign any right hereunder without the prior written consent of the
other (such consent not to be unreasonably withheld) and any such
attempted assignment or delegation shall be void.
18.5 No agency, partnership or employment is created by this Marketing
Agreement. Momentum shall not use the name of PeopleSoft in any
advertising, public relations or media release without the prior
written consent of PeopleSoft.
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18.6 This Marketing Agreement replaces and supersedes any prior verbal
understandings, written communications, and constitutes the entire
agreement between the parties concerning the subject matter hereof.
This Marketing Agreement may be amended only by a written document
executed by a duly authorized representative of each of the parties.
This Marketing Agreement may be executed in counterparts.
IN WITNESS WHEREOF, the parties have executed this Marketing Agreement as of the
Effective Date.
MOMENTUM BUSINESS APPLICATIONS, INC. PEOPLESOFT, INC.
------------------------------------ ------------------------------------
Authorized Signature Authorized Signature
------------------------------------ ------------------------------------
Printed Name and Title Printed Name and Title
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EXHIBIT A
PRICING ADDENDUM
TO
MARKETING AND DISTRIBUTION AGREEMENT
This pricing addendum ("Pricing Addendum") is part of the Marketing and
Distribution Agreement ("Marketing Agreement") between PeopleSoft and Momentum.
1. DEFINITIONS
Unless otherwise defined herein, capitalized terms used in this Pricing
Addendum shall have the same meaning as those referenced in the Marketing
Agreement.
2. PRE-RELEASE ROYALTY
THE FOLLOWING SECTION SHALL APPLY ONLY TO MOMENTUM PRODUCTS COMMERCIALIZED
BY PEOPLESOFT PRIOR TO ITS EXERCISE OF THE LICENSE OPTION.
PeopleSoft shall establish competitive list prices for the Momentum
Products in accordance with then-current market conditions.
For each Momentum Product commercialized by PeopleSoft or its channel
partners for use by End Users, prior to the exercise or the License Option
with respect to such Momentum Product, PeopleSoft shall pay Momentum SIX
PERCENT (6%) of Net Revenues.
If PeopleSoft products and Momentum Products are licensed under the same
license agreement as a packaged solution for use by an End User, the Net
Revenues payable to Momentum will be appropriately pro-rated based on the
associated weight of each component's respective list price.
3. PRODUCT PAYMENTS AND PRODUCT PAYMENTS BUYOUT OPTION
THE FOLLOWING SECTION SHALL APPLY ONLY TO MOMENTUM PRODUCTS COMMERCIALIZED
BY PEOPLESOFT SUBSEQUENT TO ITS EXERCISE OF THE LICENSE OPTION.
(a) Product Payments.
PeopleSoft will make Product Payments to Momentum with respect to each
Licensed Product equal to the sum of (i) 1% of Net Revenues plus (ii)
an additional 0.1% of such Net Revenues for each $1 million of
Development Costs with respect to such Licensed Product; provided,
however, that the royalty rate shall not exceed six per cent (6%) of
Net Revenues. Subject to PeopleSoft's product payment buy-out option
described in section 3(b) below, Product Payments will be payable
until 10 years after General Availability of the Licensed Product.
The parties agree that if PeopleSoft chooses to have a third
party distribute a Licensed Product, the parties will negotiate an
appropriate increase in the royalty rate paid by PeopleSoft.
(b) Product Payments Buyout Option
PeopleSoft will have the right to buy-out Momentum's right to receive
Product Payments for any Licensed Product. The buy-out option may be
exercised for any Licensed Product at any time beginning twelve months
after the Licensed Product is declared a Generally Available Product.
The buy-out price will be 15 times the payment made by or due from
PeopleSoft to Momentum with respect to sales of such Licensed Product
for the four quarters immediately preceding the quarter in which the
buy-out option is exercised or, in the event that such Licensed
Product has not been a License Product for all of each of such four
quarters, the buy-out price will be 15 times the annualized payment
for such Licensed Product.
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4. SUPPORT SERVICES FEES
As of the Effective Date, the parties' expectation is that as PeopleSoft
collects Support Services revenue from its End Users, (either on a
stand-alone basis or as part of the license fee revenue) and PeopleSoft
retains all such revenues.
5. PRECEDENCE AND AMENDMENT
In the event of conflict, this Pricing Addendum shall take precedence over
the Marketing Agreement. This Pricing Addendum and the Marketing Agreement
and associated Exhibits are the entire agreement between the parties
concerning the subject matter herein and may only be modified by a written
amendment executed by the parties authorized signatories. This Pricing
Addendum is effective as of the Effective Date.
MOMENTUM BUSINESS APPLICATIONS, INC. PEOPLESOFT, INC.
------------------------------------ ------------------------------------
Authorized Signature Authorized Signature
------------------------------------ ------------------------------------
Printed Name and Title Printed Name and Title
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EXHIBIT B
SOFTWARE SUPPORT SERVICES TERMS AND CONDITIONS
Software Support Services Terms and Conditions ("SUPPORT SERVICES") are
referenced in and incorporated into the Software License and Services Agreement
("Agreement") between PeopleSoft and Licensee. Capitalized terms have the same
meaning as they do in the Agreement.
1. COVERAGE
PeopleSoft provides Licensee with Support Services for the Software at the
Site in exchange for payment of the applicable Support Services fees. Only
designated Licensee employees may contact PeopleSoft for the provision of
Support Services. Licensee may acquire Support Services for additional
Licensee sites by paying PeopleSoft the applicable annual secondary site
Support Services fee.
2. SOFTWARE MAINTENANCE
PeopleSoft will periodically issue the following technical and functional
improvements to Software:
(1) Fixes to Errors; (2) Updates; and (3) Enhancements
3. PRIORITY LEVEL OF ERRORS
PeopleSoft shall address Errors in accordance with the following protocols:
Priority 1-Critical Level: PeopleSoft promptly: (1) designates PeopleSoft
specialist(s) to correct Error; (2) provides expanded communication on
correction status; and (3) escalates troubleshooting a Workaround or
Fix.
Priority 2-Urgent Level: PeopleSoft promptly: (1) designates PeopleSoft
specialist(s) to correct Error; (2) provides ongoing communication on
correction status; and (3) initiates troubleshooting a Workaround or
Fix.
Priority 3-Standard Level: PeopleSoft: (1) assigns PeopleSoft specialist(s)
to commence correction of Error; and (2) exercises all commercially
reasonable efforts to include the Fix for Error in the next Update.
Priority 4-Base Level: PeopleSoft: (1) assigns Error to case management and
tracking; and (2) may include the Fix for Error in the next Update.
4. TELEPHONE SUPPORT
PeopleSoft provides telephone support concerning Software installation and
use. Except for designated holidays, standard telephone support hours are
Monday through Friday, 4:00 a.m. to 6:30 p.m., Pacific Time. Telephone
Support is also available 24-hours-a-day, 7-days-a-week for in-production
customers who need to resolve critical production problems outside of
standard support hours.
5. ACCOUNT MANAGER
PeopleSoft assigns an account manager to assist with the support
relationship between PeopleSoft and Licensee. Licensee will reimburse
PeopleSoft for the reasonable travel and living expenses of the account
manager for on-site support activity.
6. PEOPLESOFT CUSTOMER CONNECTION
a. PeopleSoft Customer Connection is an on-line, self-service system that
features postings by PeopleSoft and customers regarding technical and
non-technical topics of interest. Licensee may access PeopleSoft
Customer Connection via Internet access at its own expense.
b. Software Updates, Enhancements, and Fixes may be delivered to Licensee
through PeopleSoft Customer Connection, or by mail from PeopleSoft on
Licensee's written request. PeopleSoft information posted to Customer
Connection is confidential and proprietary and shall only be used in
connection with Licensee's use of the Software and informational
communications with other PeopleSoft Customer Connection participants.
PeopleSoft shall have the right to publish, modify and distribute any
information or software provided by Licensee to Customer Connection in
all languages. Licensee shall not use PeopleSoft Customer Connection
for advertising or public relations purposes and shall only submit
information to PeopleSoft Customer Connection that Licensee owns or
has permission to use in such manner.
c. To diminish exposure to software viruses, PeopleSoft tests and scans
all information entered by PeopleSoft for software viruses prior to
submitting it to PeopleSoft Customer Connection. Licensee shall also
use a reliable virus detection system on any software or information
posted to PeopleSoft Customer Connection, utilize back-up procedures,
monitor access to PeopleSoft Customer Connection, promptly notify
PeopleSoft of any virus detected within Licensee's systems associated
with PeopleSoft Customer Connection and generally exercise a
reasonable degree of caution when utilizing information from
PeopleSoft Customer Connection. PeopleSoft does not warrant that
PeopleSoft Customer Connection will operate without interruption or
without errors.
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PeopleSoft reserves the right to modify or suspend PeopleSoft Customer
Connection service in connection with PeopleSoft's provision of Support
Services. PeopleSoft assumes no responsibility for anything posted by
anyone other than PeopleSoft, including, but not limited to, information
about PeopleSoft software, modification code, or portions thereof.
7. FEES
The initial period of Support Services for the Site is indicated in the
Schedule and included in the Software license fee; thereafter, in the event
Licensee elects to continue to receive Support Services, Licensee shall pay
PeopleSoft the annual Support Services fee as set forth in the Schedule.
Support Services are billed on an annual basis, payable in advance. Unless
Licensee has provided proof of tax-exempt status, Licensee is responsible
for all taxes associated with Support Services, excluding taxes based on
PeopleSoft's income. Licensee's payment shall be due within thirty (30)
days of receipt of the PeopleSoft invoice. Should Licensee elect not to
renew Support Services and subsequently requests Support Services,
PeopleSoft shall reinstate Support Services only after Licensee pays
PeopleSoft the annual then-current fee plus all cumulative fees that would
have been payable had Licensee not suspended Support Services.
8. TERM AND TERMINATION
Unless otherwise expressly set forth in the Agreement, Support Services
shall be provided for a period of one (1) year from the Schedule Effective
Date, and shall be extended each additional year unless terminated by
either party. Each one (1) year term shall commence on the anniversary of
the Schedule Effective Date.
Either party may terminate the Support Services provisions at the end of
any support term by giving the other party written notice at least ninety
(90) days prior to the end of the term.
If Licensee fails to make payment pursuant to the section titled "Fees", or
Licensee breaches the Support Services provisions and such breach has not
been cured within thirty (30) days of receipt of written notice of breach,
PeopleSoft may suspend or cancel Support Services.
9. EXCLUSIONS
PeopleSoft shall have no obligation to support:
a. Substantially altered, damaged or modified Software;
b. Software that is not the then-current release, or a Previous
Sequential Release;
c. Errors caused by Licensee's negligence, hardware malfunction, or other
causes beyond PeopleSoft's reasonable control;
d. Software installed in a hardware or operating environment not
supported by PeopleSoft; and
e. Third party software not licensed through PeopleSoft.
10. GENERAL
All Updates, Enhancements and Fixes provided to Licensee are subject to the
terms and conditions of the Agreement. PeopleSoft may modify Support
Services on an annual basis to reflect current market condition upon
reasonable notice.
11. DEFINITIONS
"ENHANCEMENT" means a technical or functional addition to the Software
delivered with a new Software release to improve functionality and/or
operations.
"ERROR" means a Software malfunction that degrades the use of the Software.
"FIX" means the repair or replacement of source, object or executable code
Software versions to remedy an Error.
"PREVIOUS SEQUENTIAL RELEASE" means a Software release for a particular
operating environment that has been replaced by a subsequent Software
release in the same operating environment. PeopleSoft will support a
Previous Sequential Release for a period of eighteen (18) months after
release of the subsequent release. Multiple Previous Sequential Releases
may be supported at any given time.
"PRIORITY 1" means an Error that renders the Software inoperative or causes
the Software to fail catastrophically.
"PRIORITY 2" means an Error that affects performance of the Software and
prohibits Licensee's use of the Software.
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"PRIORITY 3" means an Error that affects performance of the Software, but
does not prohibit Licensee's use of the Software.
"PRIORITY 4" means an Error that causes only a minor impact on the use of
the Software.
"UPDATE" means all published revisions to the Documentation and one (1)
copy of the new Software release not designated by PeopleSoft as new
products or functionality for which it charges separately.
"WORKAROUND" means a change in the procedures followed or data supplied to
avoid an Error without significantly impairing Software performance.
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