EXHIBIT 10(h) TO SYMIX SYSTEMS, INC. 1998 FORM 10-K
AMENDMENT TO THE PROGRESS SOFTWARE APPLICATION
PARTNER AGREEMENT
This AMENDMENT to the PROGRESS SOFTWARE APPLICATION PARTNER AGREEMENT is
entered into as of July 1, 1997 (the "Effective Date"), by and between
PROGRESS SOFTWARE CORPORATION, a Massachusetts corporation with its principal
place of business at 00 Xxx Xxxx, Xxxxxxx, Xxxxxxxxxxxxx 00000 ("PSC"), and
SYMIX COMPUTER SYSTEMS, INC., an Ohio corporation with its principal place of
business at 0000 Xxxxxxxxx Xxxxxxxx Xxxxx, Xxxxxxxx, Xxxx 00000 ("AP" or
"Symix").
WHEREAS, PSC and AP entered into a Progress Software Application Partner
Agreement effective as of February 8, 1995 (the "Agreement");
WHEREAS, PSC and AP desire to amend the terms and conditions of the Agreement
to provide for special pricing for certain PSC products to be distributed in
conjunction with certain AP PROGRESS-Registered Trademark--based
applications; and
WHEREAS, PSC is willing to provide AP with such special pricing subject to
the terms and conditions of this Amendment;
NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy
of which is hereby acknowledged, the parties hereto agree as follows:
1. Capitalized terms used but not defined in this Amendment shall have the
same meaning as in the Agreement.
2. The following terms as used herein shall have the following meanings:
a) "NET LICENSE FEE" shall mean the then-current total license fee
charged by AP to each customer for the Symix portion of the AP Covered
Applications bundled with the Selected PSC Products in accordance with
Section 6 below, net of any and all discounts, sales tax and shipping
fees. The term "Net License Fee" shall not include revenue obtained
by AP for hardware, implementation, training, customization, data
conversion services, 1st year Annual License Fee ("Annual License Fee"
is the name used by AP to refer to its maintenance and support
services fee), or support services. For illustration purposes only,
see EXHIBIT C for example order and calculations.
b) "SELECTED PSC PRODUCTS" shall mean the PSC Versions 7 and 8 deployment
products listed in EXHIBIT A.
c) "COVERED APPLICATIONS" shall mean the PROGRESS-Registered
Trademark--based AP application software modules listed in EXHIBIT B
to this Amendment.
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3. PSC PRODUCT LICENSES DISTRIBUTED BY AP PRIOR TO THE EFFECTIVE DATE OF THIS
AMENDMENT. Except as otherwise set forth in Sections 8, 9 and 10 of this
Amendment, the terms and conditions set forth in this Amendment shall not
apply to PSC product licenses distributed by AP to its existing installed
base prior to the Effective Date of this Amendment. Such PSC product
licenses shall be subject to PSC's standard end-user license agreement
which accompanied the PSC product and PSC's then-current standard
maintenance and upgrade policies and price list. Notwithstanding the
foregoing, in the event AP licenses additional Covered Applications to an
existing AP customer such additional licenses (with or without additional
Selected PSC Products) shall be subject to the terms and conditions set
forth in this Amendment including but not limited to the PSC Product and
Maintenance Royalty requirements specified herein.
4. AP'S DISTRIBUTION OF SELECTED PSC PRODUCTS DURING THE TERM OF THIS
AMENDMENT. Notwithstanding anything to the contrary contained in the
Agreement, the following terms and conditions shall apply to the
distribution by AP of the Selected PSC Products in connection with the
Covered Applications during the term of this Amendment:
a) TERRITORY. AP shall have the right to distribute the Selected PSC
products solely in conjunction with the deployment of the Covered
Applications in North America subject to the terms and conditions of
the Agreement and this Amendment.
b) AP PRICING. AP will, in its sole discretion, establish and maintain a
product price schedule setting forth the license fees for the Covered
Applications. A copy of the current price schedule is attached hereto
as EXHIBIT B. AP shall provide PSC with written notice of any updates
to the above-mentioned price schedule in a timely fashion.
Notwithstanding the foregoing, the special pricing terms and
conditions set forth in this Amendment are based upon AP's pricing
model set forth in EXHIBIT B. In the event AP makes substantial
changes to its pricing model from the one set forth in EXHIBIT B, AP's
license royalty fee and maintenance fee for the Selected PSC
Product(s) deployed under such new pricing model shall be subject to
change in PSC's sole discretion provided, however, that in no event
shall such formulas be significantly different from the formulas set
forth herein.
c) AP'S AGREEMENT WITH ITS CUSTOMERS. The use of the Selected PSC
Products by AP's customers shall be subject to the terms and
conditions set forth in PSC's End-User Product License Agreement (a
copy of which is attached hereto as EXHIBIT D).
d) PSC LICENSE ROYALTIES. AP shall pay PSC a royalty equal to seventeen
percent (17%)(the "Product Royalty") of the total sales price for the
Symix portion of the Covered Application(s) licensed to its customers
on or after the Effective Date of this Amendment, less any applicable
customer discount. The 17% royalty described in the foregoing
sentence is based upon the following royalties:
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(1) 14.5% of the total sales price for the Symix portion of the
Covered Application as payment for the initial product license,
and
(2) 2.5% of the total sales price for the Symix portion of the
Covered Application as payment for an initial 12 month term of
generally available PSC maintenance.
In the event AP pays royalties to PSC for initial license, initial
maintenance and upgrade fees in excess of $1,920,000 in any one year
period beginning on July 1st of each year and ending on June 30th of
the following year, the royalty rate on such license and upgrade fees
will drop from 17% to 16% during the remainder of such one year
period. Except as otherwise set forth herein, PSC's license fees for
any additional PSC Products ordered but not listed in EXHIBIT A will
be calculated by using PSC's then-current price list less applicable
Symix discount.
e) PSC MAINTENANCE ROYALTIES.
i) INITIAL MAINTENANCE TERM. In connection with AP's initial
distribution of Selected PSC Products in conjunction with each AP
license of Covered Application(s) to an AP customer, PSC
maintenance coverage for such Selected PSC Products during the
initial maintenance term shall be subject to royalties specified
in Section 4(d) above. The above-mentioned fee is based upon a
twelve (12) month initial maintenance term.
ii) RENEWAL MAINTENANCE TERM. For each AP Covered Application
license, upon expiration of an initial term of maintenance as
described in paragraph (i) of this Section 4(e) or a renewal
term of maintenance as described in this paragraph (ii) of
this Section 4(e), PSC's maintenance coverage for a twelve
(12) month renewal term shall be subject to royalty equal to
two and one-half percent (2.5%) of the original sales price
charged by AP for the Symix portion of such Covered
Applications. If AP increases the maintenance fee for any
Covered Application after such Covered Application has been
purchased by the customer, the annual maintenance royalty for
such Covered Application described in this paragraph (ii) of
this Section 4(e) will automatically be increased by the same
percentage; provided, however, that in no event shall (a) the
amount of any such maintenance royalty for the second
maintenance term be less than the maintenance royalty for the
initial maintenance term, and (b) the amount of any such
annual maintenance royalty for the third maintenance term and
any subsequent maintenance term be less than the royalty paid
by AP for the previous maintenance term. The maintenance fee
for renewal maintenance for AP customers who have allowed
their maintenance to lapse is subject to the terms and
conditions of PSC's then-current standard maintenance renewal
policy and then-current pricing.
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f) UPDATES/UPGRADES OF THE COVERED APPLICATIONS. For each Selected PSC
Product license purchased for an AP customer pursuant to Section 4(d)
above, PSC shall be entitled to payment from AP when additional
application and/or maintenance revenue is generated from such AP
customer in connection with (i) the sale or license of additional
Covered Applications or (ii) any applicable upgrade or update to the
Covered Applications and/or the Selected PSC Products (including but
not limited to revenue relating to the license of additional Covered
Application modules, upgrades or updates to existing modules and
increase in user count. PSC's portion of such revenue shall be based
upon the then-current product royalty and maintenance royalty formulas
in effect at the time of the applicable update, upgrade or license of
additional Covered Applications. AP shall include information about
any such PSC product and/or maintenance royalties in accordance with
the reporting requirements of Section 7 herein.
5. The special pricing provisions set forth in this Amendment apply only to
the Selected PSC Products distributed solely in conjunction with AP's
Covered Applications for installation in North America, in accordance with
the terms and conditions of this Amendment and the Agreement. In the event
a new AP customer or existing AP customer desires to purchase a new PSC
product license or upgrade an existing PSC product license for a PSC
product not included in the definition of Selected PSC Products listed
above or covered in Sections 8, 9 or 10 hereof, the PSC license and
maintenance fees for such new PSC product license or upgrade shall be
subject to PSC's then-current price list, terms, and conditions.
6. If AP elects to separate the fees charged by AP for PSC Products from the
fees charged for the Symix portion of the Covered Applications when
submitting proposals or invoicing AP's customers, AP (i) must show only the
suggested list price for the application-specific versions of the PSC
Products as calculated in accordance with the formula set forth on
EXHIBIT E hereto, and (ii) must not discount the PSC Products more than the
discount given by AP on the Symix portion of the Covered Applications. PSC
may amend the suggested list prices for the application-specific version of
the PSC Products from time to time by providing prior written notice to AP.
The special pricing terms and conditions set forth in this Amendment shall
not apply if AP discounts the bundled application software, together with
the Selected PSC Products, at a percentage higher than the average discount
applied to the total sale to its customers on any particular order. Under
such circumstances, the PSC product licenses shall be subject to PSC's
then-current price list.
7. ORDERING AND PAYMENT PROCEDURES.
a) On a monthly basis, AP shall provide the following reports to PSC:
i) COVERED APPLICATION(S) DEPLOYMENT REPORT. For each Covered
Application(s) license granted by AP to an AP customer under the
terms and conditions of this Amendment during the report period,
AP shall provide PSC with the following information: the
customer name, address,
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number of users, PSC serial number, AP's Net License Fee, PSC's
Product Royalty calculated in accordance with Section 4(e) above.
ii) INITIAL TWELVE (12) MONTH MAINTENANCE REPORT. For each Covered
Application(s) license including Selected PSC Products to be
covered under a twelve (12) month initial PSC maintenance term
(provided such maintenance is made generally available by PSC to
its customer base), AP shall provide the following information:
the customer name, address, PSC serial number, AP's Net License
Fee, maintenance start and end date, and PSC's Maintenance
Royalty calculated in accordance with Section 4(0(i) above.
iii) RENEWAL MAINTENANCE REPORT. For each Covered Application(s)
license including Selected PSC Products to be covered under a
twelve (12) month annual PSC renewal maintenance term (provided
such maintenance is made generally available by PSC to its
customer base), AP shall provide the following information: the
customer name, address, PSC serial number, maintenance start and
end date, and PSC's Maintenance Royalty calculated in accordance
with Section 4(f)(ii) above.
iv) UPGRADES/UPDATES. On a monthly basis, AP shall provide a report
to PSC of any and all add-on modules, updates or upgrades
occurring during the report period to AP customer licenses for
Covered Applications and/or Selected PSC Products resulting in
additional license and/or maintenance revenue to AP in accordance
with the provisions of Section 4(f) above and shall include the
following information with respect to each such update, add-on
and/or upgrade: customer name; address; PSC serial number(s);
description of the update, upgrade or add-on; PSC Product Royalty
(if additional license revenue is generated from the update,
add-on or upgrade); and PSC Maintenance Royalty (if additional
maintenance revenue is generated from the update, add-on or
upgrade).
v) The required reports referenced in paragraphs (i), (ii), (iii),
and (iv) above shall be received by PSC no later than the
fifteenth (15) day of the month following the month in which the
Covered Application(s) license is granted by AP or one of its
authorized distributors. Payment in full for all of PSC's
Product Royalties, Maintenance Royalties (initial and renewal),
and update/upgrades owed to PSC for the prior month are due with
these reports. Interest shall accrue on any delinquent amounts
owed by AP for PSC products at the lesser of eighteen percent
(18%) per annum or the maximum rate permitted by applicable usury
law.
8. AP's existing customers who have purchased PROGRESS-Registered
Trademark--based Symix applications which incorporate
PROGRESS-Registered Trademark-Version 6 or an earlier
PROGRESS-Registered Trademark- version ("Earlier PROGRESS-Registered
Trademark- Versions") prior to the Effective Date of this Amendment, may
upgrade from such applications to the Covered Applications if (i) AP
pays to PSC for each such
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existing customer a one-time fee equal to One Hundred and Fifty Dollars
($150.00) per user based upon a user count that is equal to the total
number of such customer's Symix users, (ii) AP pays to PSC an annual
maintenance royalty for each such application equal to the greater of
(a) two and one-half percent (2.5%) of the total current sales price
charged by AP for such application, or (b) the current maintenance fee
charged by PSC for such application, (iii) such existing Symix customer
has paid all required maintenance fees on such products due prior to the
date of such upgrade, and (iv) each such existing customer forfeits
their rights under the machine-based license or unlimited license
granted to such customer for the Earlier PROGRESS-Registered Trademark-
Versions and the license to use such products shall be based upon number
of users. If such Symix customers require any other PSC products other
than those included with the Covered Applications, such products must be
purchased at PSC's then current list price less Symix's standard AP
discount.
9. AP's existing customers who have purchased PROGRESS-Registered
Trademark--based Symix applications which incorporate
PROGRESS-Registered Trademark-Version 7 or 8 will be covered under the
percentage of application arrangement described in this Amendment and
such customers will not be charged PSC's standard platform and upgrade
fees for platform changes to such applications.
10. AP's customers who have purchased the Covered Applications will receive
free of charge Updates (as such term is hereinafter defined) to the PSC
Products included with Covered Applications provided that (a) the user
count for such Covered Applications has not been increased, and (b) the
customer has purchased maintenance services for the Covered Applications.
For purposes of this Section 10, "Updates" shall mean new releases of PSC
Products containing modifications or additions to the software that fixes
bugs or provides minor functionality enhancements and does not change
overall utility, functional capability or application of software.
11. Notwithstanding anything to the contrary set forth in Section 10.1 of the
Agreement, (a) the term of the Agreement shall be extended so that the
Agreement terminates on July 1, 1998 unless extended in writing by AP and
PSC, and (b) the initial term of this Amendment shall commence on July 1,
1997 and shall continue for a period of one year from such date.
Thereafter, the provisions of this Amendment shall continue in force
subject to termination (a) automatically upon termination of the Agreement
pursuant to Article 10 of the Agreement or (b) thirty (30) days after
written notice of termination by either party. If in excess of ninety
percent (90%) of the outstanding common stock of PSC is acquired by a third
party software vendor during the initial term of this Amendment or any
renewal term hereof, the term of this pricing arrangement shall be
automatically extended for an additional two-year period from the next
anniversary date hereof. In the event PSC terminates this Amendment in
accordance with part (b) above, AP's distribution of all PSC products,
including the Selected PSC Products described herein shall be subject to
the standard terms and conditions of the Agreement (prior to this
Amendment) and PSC's then-current pricing policies. Nothing in this
Section 11 shall alter or modify PSC's right, pursuant to Section 10.2 of
the Agreement, to terminate the Agreement and this Amendment at any time if
AP fails to cure a material breach of its obligations within thirty (30)
days of receipt of written notice from PSC.
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12. Notwithstanding anything to the contrary set forth in Section 11.1 of the
Agreement and except as set forth in Section 10 of this Amendment, the
special pricing and distribution terms and conditions set forth in this
Amendment may not be assigned by AP without the prior written consent of
PSC, which shall not be unreasonably withheld.
13. It is the expectation of Symix and PSC that Symix will pay royalties to PSC
for initial license, initial maintenance and upgrade fees of at least
$1,920,000 in each one year period during the term of this Amendment
beginning on July 1st of each year and ending on June 30th of the following
year.
14. Except as modified herein, all provisions of the Agreement are hereby
confirmed and in all respects this Amendment (including Exhibits A through
E hereto) and the Agreement shall be read and construed together as if the
provisions of this Amendment had been part of the Agreement. This
Amendment completely supersedes any earlier Agreements between the parties.
No other modifications or additions are made to the Agreement. Except as
may be modified or amended by this Amendment, the terms and conditions of
the Agreement shall remain in effect until termination of the Agreement.
In the event of conflict between the terms and conditions of the Agreement
and this Amendment, the terms and conditions of this Amendment shall
govern.
IN WITNESS WHEREOF, this Amendment has been executed under seal for and on
behalf of each of the parties hereto by their duly authorized representative
as of the date first set forth above.
PROGRESS SOFTWARE CORPORATION SYMIX COMPUTER SYSTEMS, INC.
By: /s/ Xxxx Xxxxxxxxx By: /s/ Xxxxxxxx XxXxxx
--------------------------- ----------------------------
Name: Xxxx Xxxxxxxxx Name: Xxxxxxxx XxXxxx
------------------------- --------------------------
Title: Director, N.A. Sales Title: CFO
----------------------- ------------------------
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EXHIBIT A
SELECTED PSC PRODUCTS
PROGRESS-Registered Trademark- 4GL
PROGRESS-Registered Trademark- Enterprise Database Server
Query/Results
Client/Networking
PROGRESS-Registered Trademark- AppServer
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EXHIBIT B
COVERED APPLICATIONS/PRICE SCHEDULE
SyteLine
Data Collection
Symix 4.0
The Covered Applications will only include a single user 4GL license for
each database server and a user count equal to the number of Symix SyteLine
and Symix Data Collection sessions for Enterprise Database, Client
Networking, PROGRESS-Registered Trademark- AppServer and Query/Results.
[Attach Current AP Price Schedule]
(Attachment omitted)
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EXHIBIT C
EXAMPLE ORDER AND CALCULATIONS
If AP sells customer ABC company $130,000 in Covered Applications of
which the sales price for the Symix portion of such Covered Applications is
$100,000, AP would pay to PSC a royalty of $17,000 calculated as follows:
a. 14.5% of the total sales price for the Symix portion
of the Covered Applications for the initial product
license $14,500
b. 2.5% of the total sales price for PSC maintenance
during the Initial Maintenance Term 2,500
-------
TOTAL ROYALTY DUE PSC $17,000
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EXHIBIT D
[This page will be replaced by a copy of PSC's End-User Product License
Agreement]
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EXHIBIT E
FORMULA FOR CALCULATING SUGGESTED LIST PRICE
The suggested list price of the PSC Products included with any Covered
Application shall be calculated as follows:
$1,200 per user for the Enterprise Database Server, Client
Networking, Query/RESULTS and PROGRESS-Registered Trademark-
App Server and one 4GL Development System.
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