Exhibit 10.5
Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
SOFTWARE LICENSE, DEVELOPMENT
AND
SERVICES AGREEMENT
BETWEEN
TUMBLEWEED SOFTWARE CORPORATION
AND
UNITED PARCEL SERVICE GENERAL SERVICES, CO.
EFFECTIVE DECEMBER 19, 1997
TABLE OF CONTENTS
PAGE
1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
a. "Affiliate". . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
b. "Application Program Interfaces" . . . . . . . . . . . . . . . . . .2
c. "Authorized Shipping Outlet" . . . . . . . . . . . . . . . . . . . .2
d. "Business Day" . . . . . . . . . . . . . . . . . . . . . . . . . . .2
e. "Client Software". . . . . . . . . . . . . . . . . . . . . . . . . .2
f. "Confidential Information" . . . . . . . . . . . . . . . . . . . . .3
g. "Critical Defect". . . . . . . . . . . . . . . . . . . . . . . . . .3
h. "Custom Client Software" . . . . . . . . . . . . . . . . . . . . . .3
i. "Custom Server Software" . . . . . . . . . . . . . . . . . . . . . .3
j. "Custom Software". . . . . . . . . . . . . . . . . . . . . . . . . .3
k. "Dedicated Support Personnel" or "DSP" . . . . . . . . . . . . . . .3
l. "Derivative Work". . . . . . . . . . . . . . . . . . . . . . . . . .3
m. "Detailed Design Specifications" . . . . . . . . . . . . . . . . . .4
n. "Documentation". . . . . . . . . . . . . . . . . . . . . . . . . . .4
o. "Enhancement". . . . . . . . . . . . . . . . . . . . . . . . . . . .4
p. "Functional Specifications". . . . . . . . . . . . . . . . . . . . .5
q. "Major Defect" . . . . . . . . . . . . . . . . . . . . . . . . . . .5
r. "Messaging Service". . . . . . . . . . . . . . . . . . . . . . . . .5
s. "Minor Defect" . . . . . . . . . . . . . . . . . . . . . . . . . . .5
t. "Person" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
u. "Phase I Software" . . . . . . . . . . . . . . . . . . . . . . . . .5
v. "Phase II Software". . . . . . . . . . . . . . . . . . . . . . . . .5
w. "Project". . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
x. "Server Software". . . . . . . . . . . . . . . . . . . . . . . . . .5
y. "Services" . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
z. "Software" . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
aa. "Source Code". . . . . . . . . . . . . . . . . . . . . . . . . . . .6
bb. "Specifications" . . . . . . . . . . . . . . . . . . . . . . . . . .6
cc. "Standard Software". . . . . . . . . . . . . . . . . . . . . . . . .6
dd. "Supported Datacenter" . . . . . . . . . . . . . . . . . . . . . . .6
ee. "Trade Secret" . . . . . . . . . . . . . . . . . . . . . . . . . . .6
ff. [ * ] . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
gg. "Tumbleweed Marks" . . . . . . . . . . . . . . . . . . . . . . . . .7
hh. "UPS Information". . . . . . . . . . . . . . . . . . . . . . . . . .7
ii. "UPS Inventions" . . . . . . . . . . . . . . . . . . . . . . . . . .7
jj. "Use". . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
---------------
[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
i
2. Software Development. . . . . . . . . . . . . . . . . . . . . . . . . . .8
a. Initial Phases . . . . . . . . . . . . . . . . . . . . . . . . . . .8
b. Subsequent Phases. . . . . . . . . . . . . . . . . . . . . . . . . .8
c. Functional Specifications for Subsequent Phases. . . . . . . . . . .8
d. Detailed Design Specifications . . . . . . . . . . . . . . . . . . .9
e. Acceptance of Specifications . . . . . . . . . . . . . . . . . . . .9
f. Programming and Tumbleweed Testing . . . . . . . . . . . . . . . . .9
g. On-Site Installation Support . . . . . . . . . . . . . . . . . . . .9
h. Designation of Project Coordinators. . . . . . . . . . . . . . . . .9
i. Progress Reports . . . . . . . . . . . . . . . . . . . . . . . . . 10
j. Extensions of Time . . . . . . . . . . . . . . . . . . . . . . . . 10
k. Termination of Development Services. . . . . . . . . . . . . . . . 12
3. Modifications to Specifications . . . . . . . . . . . . . . . . . . . . 13
a. Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
b. Accepted Changes . . . . . . . . . . . . . . . . . . . . . . . . . 13
4. Implementation and Acceptance . . . . . . . . . . . . . . . . . . . . . 13
a. Implementation Schedule. . . . . . . . . . . . . . . . . . . . . . 13
b. Acceptance Testing . . . . . . . . . . . . . . . . . . . . . . . . 13
c. Interim Testing. . . . . . . . . . . . . . . . . . . . . . . . . . 15
5. Licenses and Proprietary Rights . . . . . . . . . . . . . . . . . . . . 15
a. Server Software. . . . . . . . . . . . . . . . . . . . . . . . . . 15
b. Client Software. . . . . . . . . . . . . . . . . . . . . . . . . . 16
c. Ownership of Custom Software . . . . . . . . . . . . . . . . . . . 17
i. UPS Inventions. . . . . . . . . . . . . . . . . . . . . . . 17
ii. UPS Information . . . . . . . . . . . . . . . . . . . . . . 17
d. Ownership of Customer Data . . . . . . . . . . . . . . . . . . . . 18
e. Tumbleweed Trademarks and Trade Names. . . . . . . . . . . . . . . 18
f. Developer Kits (and Localization Kits) . . . . . . . . . . . . . . 19
g. Interface Information. . . . . . . . . . . . . . . . . . . . . . . 20
h. Documentation Licences . . . . . . . . . . . . . . . . . . . . . . 21
i. UPS Intellectual Property. . . . . . . . . . . . . . . . . . . . . 21
j. No Other Licenses. . . . . . . . . . . . . . . . . . . . . . . . . 21
6. Fees and Payment. . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
a. License Fee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
b. Royalties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
c. [ * ]. . . . . . . . . . . . . . . . . . . . . . . . . . 23
d. Royalty Payments . . . . . . . . . . . . . . . . . . . . . . . . . 23
e. Royalties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
f. Demonstration and Internal Use . . . . . . . . . . . . . . . . . . 24
---------------
[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
ii
g. Initial Phase Development Fee. . . . . . . . . . . . . . . . . . . 24
h. Development Fees for Subsequent Phases . . . . . . . . . . . . . . 24
i. Software Maintenance and Support Services. . . . . . . . . . . . . 24
j. Dedicated Support Personnel. . . . . . . . . . . . . . . . . . . . 25
k. Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
l. Commission for Referrals . . . . . . . . . . . . . . . . . . . . . 25
m. Sales and Use Taxes. . . . . . . . . . . . . . . . . . . . . . . . 26
n. Payment Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . 26
o. Payment Discrepancies. . . . . . . . . . . . . . . . . . . . . . . 26
p. Time and Materials Fees. . . . . . . . . . . . . . . . . . . . . . 26
7. Marketing, Distribution and Offering of Messaging Service . . . . . . . 27
a. Marketing Plan . . . . . . . . . . . . . . . . . . . . . . . . . . 27
b. Distribution of Client Software. . . . . . . . . . . . . . . . . . 27
c. Trademark Usage. . . . . . . . . . . . . . . . . . . . . . . . . . 28
d. End User Support . . . . . . . . . . . . . . . . . . . . . . . . . 28
e. Marketing Flexibility. . . . . . . . . . . . . . . . . . . . . . . 28
f. Additional Marketing and Sales Support . . . . . . . . . . . . . . 28
8. Warranties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
a. Software . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
b. Compatibility. . . . . . . . . . . . . . . . . . . . . . . . . . . 29
c. Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
d. Intentionally omitted. . . . . . . . . . . . . . . . . . . . . . . 29
e. Reliability. . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
f. Intentionally omitted. . . . . . . . . . . . . . . . . . . . . . . 30
g. Locks. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
h. Viruses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
i. Millennium . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
j. Warranty Disclaimer. . . . . . . . . . . . . . . . . . . . . . . . 31
9. Software Support Services . . . . . . . . . . . . . . . . . . . . . . . 31
a. Notification of Defects. . . . . . . . . . . . . . . . . . . . . . 31
b. Enhancements . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
c. Second Level Support . . . . . . . . . . . . . . . . . . . . . . . 32
d. Supported Datacenter Support . . . . . . . . . . . . . . . . . . . 33
e. Remedial Efforts by Tumbleweed . . . . . . . . . . . . . . . . . . 33
f. Termination of Maintenance . . . . . . . . . . . . . . . . . . . . 36
g. Maintenance Exclusions . . . . . . . . . . . . . . . . . . . . . . 36
10. Confidential Information. . . . . . . . . . . . . . . . . . . . . . . . 36
a. Non-Disclosure of Trade Secrets and Confidential Information . . . 36
b. Return of Materials. . . . . . . . . . . . . . . . . . . . . . . . 37
iii
c. Third Party Materials. . . . . . . . . . . . . . . . . . . . . . . 37
d. Publicity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
e. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
11. Source Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
a. Right to Use Source Code . . . . . . . . . . . . . . . . . . . . . 38
b. Source Code Escrow . . . . . . . . . . . . . . . . . . . . . . . . 38
c. Verification of Escrow Deposit(s). . . . . . . . . . . . . . . . . 39
d. Ownership of Modifications Made by UPS . . . . . . . . . . . . . . 39
e. Source Code License. . . . . . . . . . . . . . . . . . . . . . . . 39
f. Discontinuance of Marketing. . . . . . . . . . . . . . . . . . . . 39
12. Training Services . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
13. Compliance with Laws. . . . . . . . . . . . . . . . . . . . . . . . . . 40
a. Licenses and Permits . . . . . . . . . . . . . . . . . . . . . . . 40
b. Changes in Law and Regulations . . . . . . . . . . . . . . . . . . 40
14. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
a. Proprietary Rights Indemnification . . . . . . . . . . . . . . . . 41
b. Tumbleweed's General Indemnity . . . . . . . . . . . . . . . . . . 41
c. UPS's General Indemnity. . . . . . . . . . . . . . . . . . . . . . 42
d. Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
15. Co-Promotion and Co-Advertising . . . . . . . . . . . . . . . . . . . . 42
16. Term and Termination. . . . . . . . . . . . . . . . . . . . . . . . . . 43
a. Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
b. Termination by Tumbleweed; Escalation. . . . . . . . . . . . . . . 43
c. Consequences of Termination. . . . . . . . . . . . . . . . . . . . 44
17. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
a. Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
b. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . 45
c. Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . 45
d. Relationship of the Parties. . . . . . . . . . . . . . . . . . . . 45
e. Amendments and Modifications . . . . . . . . . . . . . . . . . . . 45
f. Personal Pronouns; Headings. . . . . . . . . . . . . . . . . . . . 45
g. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
h. No Assignment. . . . . . . . . . . . . . . . . . . . . . . . . . . 46
i. No Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
j. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
k. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
iv
l. Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
m. Personnel Rules and Regulations. . . . . . . . . . . . . . . . . . 47
n. Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
o. Limitation of Liability. . . . . . . . . . . . . . . . . . . . . . 48
p. No Consequential Damages . . . . . . . . . . . . . . . . . . . . . 48
v
SOFTWARE LICENSE DEVELOPMENT AND SERVICES AGREEMENT
THIS SOFTWARE LICENSE DEVELOPMENT AND SERVICES AGREEMENT (this "Agreement")
is made and entered into effective as of the 19th day of December, 1997, by and
between TUMBLEWEED SOFTWARE CORPORATION ("Tumbleweed"), a California corporation
with offices at 0000 Xxxxxxxx Xxxxxx, Xxxxxxx Xxxx, Xxxxxxxxxx 00000, and UNITED
PARCEL SERVICE GENERAL SERVICES CO. ("UPS"), a Delaware corporation with offices
at 00 Xxxxxxxx Xxxxxxx, Xxxxxxx, Xxxxxxx 00000, and which is authorized to
conduct business in the State of New York.
1. DEFINITIONS. For purposes of this Agreement, the following terms have
the meetings set forth below:
a. "AFFILIATE" means, with respect to UPS, any entity which
controls, is controlled by or is under common control with UPS, or any
partnership, joint venture, consortium or other such entity in which UPS or its
Affiliates have any material form of ownership. For purposes of this definition
of Affiliate, "material form of ownership" shall be deemed to include
partnerships, joint ventures, consortiums or other entities in which UPS or its
Affiliates have at least a thirty percent (30%) ownership interest. The
definition of Affiliate shall specifically exclude [ * ] and any
successor entity thereof.
b. "APPLICATION PROGRAM INTERFACES" OR "APIS" mean those portions of
the Software required to enable external applications to interface into and with
the Software.
c. "AUTHORIZED SHIPPING OUTLET" means any third party authorized
shipping outlet or UPS, or any third party which resells the UPS portfolio of
services, which third party is designated by UPS to provide the Messaging
Service. UPS shall provide written notice to Tumbleweed of the identity of each
such Authorized Shipping Outlet from time to time.
d. "BUSINESS DAY" means (i) with respect to any time period within
which UPS must respond or otherwise perform some action, Monday through Friday,
excluding any holidays recognized by UPS as company-wide holidays; and (ii) with
respect to any time period within which Tumbleweed must respond or otherwise
perform some action, Monday through Friday, excluding any holidays recognized by
Tumbleweed as company-wide holidays. All time period references in this
Agreement to "days" other than Business Days shall be deemed to refer to
calendar days.
---------------
[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 1 December 18, 1997
e. "CLIENT SOFTWARE" means the client-based portions of the
pre-existing computer software programs described in Exhibit A hereto, together
with the Documentation therefor and all Enhancements thereto. The Client
Software furnished hereunder shall be in machine readable object code form.
f. "CONFIDENTIAL INFORMATION" shall mean any data or information
that is of value to and is not generally known to competitors of the party which
owns and/or discloses such data or information, and that (i) in the case of data
or information which has been reduced to tangible form, is marked clearly and
conspicuously with a legend identifying such data or information as confidential
or proprietary, or (ii) in the case of data or information communicated orally,
is denominated as confidential or proprietary at the time of disclosure and
confirmed in a writing by the disclosing party, summarizing such data or
information within a reasonable period of time thereafter. Confidential
Information also includes any information described in this subsection (f) which
either party obtains from another party under an obligation of confidentiality.
g. "CRITICAL DEFECT" means the failure of the Software to conform to
the Detailed Design Specifications such that any critical function of the
Messaging Service is inoperable and no immediate circumvention is possible.
h. "CUSTOM CLIENT SOFTWARE" means the client-based portions of the
computer software programs, and any and all portions thereof, developed by
Tumbleweed pursuant to this Agreement. The Custom Client Software includes,
without limitation, the client-based portions of the Phase I Software and the
client-based portions of the Phase II Software, and the Documentation therefor
and all Enhancements thereto. Unless otherwise specified in the applicable
Specifications, all Custom Client Software furnished hereunder shall be in
machine readable object code form.
i. "CUSTOM SERVER SOFTWARE" means the server-based portions of the
computer software programs, and any and all portions thereof, developed by
Tumbleweed pursuant to this Agreement. The Custom Server Software includes,
without limitation, the server-based portions of the Phase I Software and the
server-based portions of the Phase II Software, and the Documentation therefor
and all Enhancements thereto. Unless otherwise specified in the applicable
Specifications, all Custom Server Software furnished hereunder shall be in
machine readable object code form.
j. "CUSTOM SOFTWARE" means the Custom Server Software and the Custom
Client Software, collectively.
k. "DEDICATED SUPPORT PERSONNEL" OR "DSP" means the person(s) who
shall be (i) assigned to one (1) or more UPS data centers, (ii) dedicated to
assisting UPS with the ongoing support and maintenance of the Software,
including without limitation, assisting UPS in performance of its first level
support obligations, and (iii) physically present at the relevant UPS
UPS/Tumbleweed Confidential 2 December 18, 1997
data center(s) during UPS Business Hours and available by pager twenty-four (24)
hours per day, seven (7) days per week.
l. "DERIVATIVE WORK" means a work which is based upon one or more
pre-existing works, such as a revision, enhancement, modification, translation,
abridgement, condensation, expansion, or any other form in which such
pre-existing work(s) may be recast, transformed, or adapted, and which, if
prepared without authorization of the owner of the copyright in such
pre-existing work(s), would constitute a copyright infringement.
m. "DETAILED DESIGN SPECIFICATIONS" means the detailed description
of the Software to be developed and/or provided by Tumbleweed during any Phase
(as defined in Section 2 below) of the Project, together with the detailed
description of all Enhancements to such Software (provided that in no event
shall Tumbleweed be obligated to prepare Detailed Design Specifications for
Enhancements that are not developed specifically for UPS). The Detailed Design
Specifications shall include, at a minimum, system flow charts, program
descriptions, file layouts, database structures, report layouts and screen
layouts, interface requirements and layouts, conversion requirements and
layouts, equipment requirements and acceptance test plans for the Software. For
Enhancements that are not developed specifically for UPS, the specifications
created by Tumbleweed for such Enhancements shall be treated as Detailed Design
Specifications for such Enhancements. Following preparation and acceptance of
the Detailed Design Specifications by UPS with respect to any Phase(s)
subsequent to Phase II of the Project, as provided for in Section 2(d), such
Detailed Design Specifications, with respect to such Phase(s), shall supercede
and replace the Functional Specifications for such Phase(s). In the event that
Detailed Design Specifications are not prepared with respect to any subsequent
Phase(s) of the Project, the term "Detailed Design Specifications," as used
herein with respect to such Phase(s), shall be deemed to mean the Functional
Specifications for such Phase(s). The term "Detailed Design Specifications," as
used herein with respect to Phases I and II of the Project, shall be deemed to
refer solely to the Specifications for such Phases set forth in Exhibits A and B
hereto. In the event that any Detailed Design Specifications hereunder include
any disclaimer or other limitation of warranty or liability which conflicts with
any of the terms and conditions of this Agreement, the terms and conditions of
this Agreement shall control and such disclaimers and limitations shall not
apply.
n. "DOCUMENTATION" means all detailed user and operational manuals,
instructions and other documentation for the Software, and all training manuals
and routines designed to train users in the operation of the Software (including
without limitation, the Custom Client Software and the Custom Server Software).
All Documentation supplied on disks must be in machine readable form.
o. "ENHANCEMENT" means any modifications, enhancements, revisions
(including, without limitation, revisions to support new releases of any
operating system), corrections, updates, upgrades, new versions, additions,
extensions, interfaces, new platforms, and improvements of any type made by or
on behalf of Tumbleweed to the Software (where
UPS/Tumbleweed Confidential 3 December 18, 1997
Tumbleweed has the right to distribute such Enhancements) and which are made
available by Tumbleweed to UPS or which are made generally commercially
available by Tumbleweed to its customers. For the purposes of this Agreement,
software shall be "generally commercially available" when Tumbleweed lists such
software on a standard price sheet or makes such software available for fee-free
download by customers or makes such software available to five (5) or more
Persons for use on a revenue generating basis.
p. "FUNCTIONAL SPECIFICATIONS" means the description of the Software
to be developed and/or provided by Tumbleweed during any Phase (as defined in
Section 2 below) of the Project. In the event that any Functional
Specifications hereunder include any disclaimer or other limitation of warranty
or liability which conflicts with any of the terms and conditions of this
Agreement, the terms and conditions of this Agreement shall control and such
disclaimers and limitations shall not apply.
q. "MAJOR DEFECT" means the failure of the Software to conform to
the Detailed Design Specifications such that either (i) and critical function of
the Software is inoperable, but immediate circumvention is possible, or (ii) any
major (non-critical) function of the Software is inoperable and no immediate
circumvention is possible.
r. "MESSAGING SERVICE" means the electronic delivery/messaging
service to be offered by UPS and/or any of its Affiliates and Authorized
Shipping Outlets, for the electronic delivery (and related transaction
attestation services) of digital representations, including without limitation,
textual messages, photographic images, audio, video, graphics, computer software
and/or other information or content.
s. "MINOR DEFECT" means any failure of the Software to conform to
the Detailed Design Specifications in a manner not covered by Critical Defects
and/or Major Defects.
t. "PERSON" means any individual, or any corporation, limited
liability company, partnership, joint venture, association, joint stock company,
trust, incorporated organization or other legal entity.
u. "PHASE I SOFTWARE" means the computer software programs, and any
and all portions thereof, developed by Tumbleweed pursuant to this Agreement, as
described in the Phase I portion of the Specifications. Except to the extent
specified in the applicable Specifications, the Phase I Software furnished
hereunder shall be in machine readable object code form.
v. "PHASE II SOFTWARE" means the computer software programs, and any
and all portions thereof, developed by Tumbleweed pursuant to this Agreement, as
described in the Phase II portion of the Specifications. Except to the extent
specified in the applicable Specifications, the Phase II Software furnished
hereunder shall be in machine readable object code form.
UPS/Tumbleweed Confidential 4 December 18, 1997
w. "PROJECT" means the design, development, installation and testing
of the Software.
x. "SERVER SOFTWARE" means the server-based portions of the
pre-existing computer software programs described in Exhibit A hereto, together
with the documentation therefor and all Enhancements thereto. The Server
Software furnished hereunder shall be in machine readable object code form.
y. "SERVICES" means all work to be provided by Tumbleweed under the
terms of this Agreement.
z. "SOFTWARE" means the Standard Software and the Custom Software,
collectively.
aa. "SOURCE CODE" means a copy of the source code corresponding to
the Software, including all updates to the source code of the Software delivered
to the Escrow Agent from time to time pursuant to Section 11 of this Agreement,
plus any pertinent associated commentary or explanation that may be necessary to
render the source code understandable and usable by highly-trained computer
programmers. The Source Code shall be in a format and on a storage medium
suitable for loading onto customary development platforms, and shall not be
encrypted. Insofar as the Software includes any computer software programs or
other material which are proprietary to Persons other than Tumbleweed, and for
which Tumbleweed has no right to deposit such source code, the Source Code shall
not include the source code for any such third party computer software programs,
but shall include object code modules therefor where Tumbleweed has the right to
deposit such materials. Insofar as the "development environment" employed by
Tumbleweed for the development, maintenance and implementation of the Source
Code includes any device, programming, or documentation not commercially
available to UPS on reasonable terms through readily known sources other than
Tumbleweed, the Source Code shall include al such devices, programming, or
documentation. The foregoing reference to such "development environment" is
intended to apply to any programs, including compilers, "workbenches," tools,
and higher-level (or "Proprietary") languages, used by Tumbleweed for the
development, maintenance and implementation of the Source Code. The Source Code
for the Standard Software shall be deemed to be Tumbleweed's Trade Secret.
bb. "SPECIFICATIONS" mean the Functional Specifications and/or the
Detailed Design Specifications, individually and collectively.
cc. "STANDARD SOFTWARE" means the Server Software and the Client
Software, collectively.
UPS/Tumbleweed Confidential 5 December 18, 1997
dd. "SUPPORTED DATACENTER" means the UPS data processing
facility(ies) that will use the Software to operate the Messaging Service, for
which UPS has elected to secure the Services of the Dedicated Support Personnel.
ee. "TRADE SECRET" shall mean any Confidential Information of the
party which owns and/or discloses such information, including but not limited to
technical or non-technical data, a formula, a pattern, a compilation, a program,
a device, a method, a technique, a drawing, a process, financial data, financial
plans, product plans, or a list of actual or potential customers or suppliers,
which (i) derives economic value, actual or potential, from not being generally
known to and not being readily ascertainable by proper means by other person who
can obtain economic value from its disclosure or use and (ii) is the subject of
efforts that are reasonable under the circumstances to maintain its secrecy.
Trade Secrets specifically include any Confidential Information described in
this subsection (ee) which either party obtains from another party under an
obligation of confidentiality.
ff. "TRANSACTION" means any [ * ]
gg. "TUMBLEWEED MARKS" mean the "Tumbleweed" and "Tumbleweed Posta"
trademarks, the 'Tumbleweed" logo, and any other trademark, trade name or
service xxxx of Tumbleweed relating to products and/or services involving
Internet or intranet delivery systems.
hh. "UPS INFORMATION" means those portions of technical information,
computer or other specifications, documentation, works of authorship and other
creative works, written, oral or otherwise expressed, originated by Tumbleweed
or any of its employees, consultants, representatives or agents (collectively,
"Associates") in the course of performing work under this Agreement in
connection with any component or portion of the Custom Software for which the
applicable Specifications indicate that UPS will won such component or portion.
ii. "UPS INVENTIONS" mean those specific inventions, discoveries and
improvements which are conceived, first reduced to practice, made or developed
in the course of work performed under this Agreement by Tumbleweed or by one or
more of its Associates in connection with any component or portion of the Custom
Software for which the applicable Specifications indicate that UPS will own such
component or portion.
jj. "USE" means access, configure reproduce, execute, display,
perform, employ, load, process, run and/or utilize the Software and, upon
release of the Source Code for
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information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 6 December 18, 1997
the software to UPS pursuant to Section 11 hereof and/or the Escrow Agreement
attached hereto as Exhibit F, solely with respect to such Source Code, shall
also include the right to Use such Source Code (solely as permitted by the
Source Code License set forth in Section 11(e)). In the event that the
applicable Specifications indicate that the Source Code for any portions of the
Custom Software developed thereunder will be provided to UPS, the term "Use"
shall also include the right to Use, modify, maintain, update and/or create
Derivative Works of the Source Code for such Custom Software, so long as such
Use does not disclose any Tumbleweed Trade Secrets.
2. SOFTWARE DEVELOPMENT. The Software will be developed and/or provided
by Tumbleweed in two or more phases (the "Phases"), in accordance with the
following terms and procedures:
a. INITIAL PHASES. During Phase I of the Project, Tumbleweed will
provide to UPS the development and implementation Services, and the associated
Software deliverables, identified or described in the Specifications set forth
in Exhibit A hereto, covering the Standard Software and the Phase I Software.
During Phase II of the Project, Tumbleweed will provide to UPS the development
and implementation Services, and the associated Software deliverables,
identified or described in the Specifications set forth in Exhibit B hereto,
covering the Phase II Software.
b. SUBSEQUENT PHASES. Tumbleweed agrees to provide to UPS, as
requested by UPS from time to time, software development and other Services in
connection with subsequent Phases of this Agreement. Except as may be
specifically agreed in writing by the parties, the terms and conditions of this
Agreement shall apply to each such subsequent Phase which is proposed by UPS and
accepted by Tumbleweed for the furnishing of such Services. Each such Phase
will generally be defined by a set of mutually agreed Functional Specifications,
which will contain a description of the tasks to be performed by Tumbleweed, the
Software, Documentation and other deliverables to be provided by Tumbleweed, a
schedule of performance and either a schedule of payments (for fixed price work)
or a statement of Tumbleweed's then-current rates (for work performed on a time
and materials basis). The Functional Specifications may include such additional
terms and conditions as the parties may agree to include.
c. FUNCTIONAL SPECIFICATIONS FOR SUBSEQUENT PHASES. Within ten (10)
Business Days after the delivery of any Functional Specifications to Tumbleweed
(unless a longer period is reasonably required), Tumbleweed shall either (i)
accept the Functional Specifications in writing, or (ii) notify UPS if
Tumbleweed objects to any part of the Functional Specifications, specifying with
particularity and in good faith the changes which Tumbleweed desires in order to
accept the Functional Specifications. The parties agree that Tumbleweed's
concerns regarding ownership issues relating to any Custom Software to be
developed pursuant to the proposed Functional Specifications shall constitute
"good faith" concerns of the purposes of this Agreement. Within ten (10)
Business Days of delivery of any objections to the Specifications, UPS and
Tumbleweed shall confer in order to resolve Tumbleweed's objections, and UPS
UPS/Tumbleweed Confidential 7 December 18, 1997
shall resubmit the Functional Specifications to Tumbleweed. Within ten (10)
Business Days of the delivery of the revised Functional Specifications,
Tumbleweed shall either (i) accept the revised Functional Specifications in
writing, (ii) notify UPS if it continues to object to any part of the Functional
Specifications, or (iii) decline to perform such Services relating to the
proposed Functional Specifications. If the parties are unable to agree in
writing to a set of Functional Specifications within thirty (30) days of the
delivery of the revised Functional Specifications, then any proposed development
Services relating to that particular Phase shall be deemed terminated.
d. DETAILED DESIGN SPECIFICATIONS. With respect to each Phase
beyond Phase II of the Project, Tumbleweed shall, with UPS's cooperation and at
no additional charge to UPS, gather the necessary detailed requirements and
develop and deliver to UPS a set of Detailed Design Specifications based upon
the Functional Specifications which have been mutually agreed by the parties
with respect to such Phase. The Detailed Design Specifications shall be
delivered to UPS on or before the specified time set forth in the applicable
Functional Specifications. Within ten (10) Business Days of the delivery of the
Detailed Design Specifications to UPS, UPS shall notify Tumbleweed in writing of
its acceptance or rejection of the Detailed Design Specifications. If the
Detailed Design Specifications are rejected, UPS will specify the reasons for
such rejection and Tumbleweed shall have ten (10) Business Days to revise and
re-deliver amended Detailed Design Specifications to UPS for acceptance. Once
accepted by UPS, the Detailed Design Specifications shall supersede the
Functional Specifications for that portion of the Project to which the Detailed
Design Specifications relate. If UPS rejects the amended Detailed Design
Specifications, UPS's sole and exclusive remedy shall be to terminate the
particular phase to which UPS's rejection relates.
e. ACCEPTANCE OF SPECIFICATIONS. Upon acceptance of the
Specifications for any Phase of the Project such Specifications shall be deemed
to be a part of this Agreement, and Tumbleweed shall perform the Services
described in such Specifications within the time frames, in the manner, and for
the fees specified therein.
f. PROGRAMMING AND TUMBLEWEED TESTING. After approval of the
Detailed Design Specifications by UPS pursuant o Section 2(d) hereof, Tumbleweed
shall commence program coding and testing to provide the necessary programming
of the Software. Upon completion of the program coding and testing, Tumbleweed
shall notify UPS in writing that such program coding and testing is completed
and that, upon delivery of the Software to UPS (and installation thereof by
Tumbleweed in the event such installation is at a Supported Datacenter) UPS may
commence its acceptance testing.
g. ON-SITE INSTALLATION SUPPORT. Upon delivery of the Phase II
Software, and again upon completion of the upgrade of the Custom Software to
reflect version 2.0 of the Standard Software, Tumbleweed shall identify and
assign at least one (1) Tumbleweed professional services employee to be on site
at UPS's facilities and devote all of his or her business time for a period of
up to three (3) Business Days, the duration of which will be determined by
UPS/Tumbleweed Confidential 8 December 18, 1997
UPS in its sole discretion, to support the installation of the Software. In the
event that UPS requires additional support beyond such three (3) Business Day
period, and such support is not required as a result of any problems with the
Software encountered during such installation, UPS shall pay Tumbleweed for such
additional on-site installation support Services on a time and materials basis.
h. DESIGNATION OF PROJECT COORDINATORS. Tumbleweed shall designate
Xxxxxx X. Xxxxxx as its Project coordinator (the "Tumbleweed Project
Coordinator"), who shall be assigned by Tumbleweed to supervise the Project,
shall devote the necessary time to such endeavor, and shall serve as UPS's point
of contact for the resolution of problems. The services of the Tumbleweed
Project Coordinator shall be included in the fees provided for herein. UPS
shall also designate an employee who shall be assigned by UPS to coordinate
UPS's involvement in the Project (the "UPS Project Coordinator"), who shall
serve as Tumbleweed's point of contact for the resolution of problems. The
initial UPS Project Coordinator is Xxxx Xxxxxx. Either party may change its
Project Coordinator from time to time upon prior written notice to the other
party; provided, however, that Tumbleweed shall not change the Tumbleweed
Project Coordinator with respect to any Phase of the Project without the prior
written consent of UPS, which consent shall not be unreasonably withheld, unless
such individual shall have left the employment of Tumbleweed.
i. PROGRESS REPORTS. The UPS Project Coordinator and Tumbleweed
Project Coordinator, as well as appropriate additional personnel involved in the
particular task underway, shall arrange a conference call (or schedule a meeting
at a mutually agreed site) to discuss the progress made by Tumbleweed and UPS.
Such call or meeting shall take place (i) each week during the period prior to
the Commercial Availability Date, (ii) each month for the first year of the
Agreement, and (iii) each quarter for the remainder of the Agreement. Each such
conference call (or meeting) shall include a discussion by the parties of any
actual or potential events which may give rise to delays in any schedules. In
order to facilitate proper project management, UPS shall notify Tumbleweed
promptly of any actual or potential events which may give rise to delays of any
UPS deliverables or performance of UPS's obligations (or any obligations of
UPS's Affiliates or Associates) under this Agreement, and Tumbleweed shall, for
each such conference call (or meeting), provide UPS with a progress report
specifying in detail:
(A) Any critical issue encountered by Tumbleweed during the preceding
period, including without limitation, the failure of either party to
perform, any delay of either party in performing or the inadequate
performance of either party, which may prevent or tend to prevent
Tumbleweed from completing any task by the completion date;
(B) An estimated length of any delay which may result from any critical
issues; and
(C) The cause of any critical issue and the specific steps taken or
proposed to be taken by Tumbleweed or UPS, as appropriate, to remedy
such critical issue.
UPS/Tumbleweed Confidential 9 December 18, 1997
Each progress report provided by Tumbleweed pursuant to this Section
2(i) shall include recent critical issues discussed and dealt with, together
with those not yet raised by Tumbleweed, during the preceding period. In any
event, critical issues shall be discussed and dealt with as soon as possible
after identification by Tumbleweed or UPS. In the event Tumbleweed fails to
specify in writing any critical issue with respect to a given period in such
manner and at such time as required pursuant to this Section 2(i), it shall be
presumed that no critical issue arose during such period.
j. EXTENSIONS OF TIME. If Tumbleweed is delayed at any time during
Phase I or Phase II of the Project by the failure of UPS or its Affiliates or
Associates to perform the obligations set forth in Exhibit D hereto, then upon
notice from Tumbleweed to UPS, the affected Implementation Schedule date(s) will
be reasonably extended to accommodate such delays, not to exceed a day-for-day
extension for each such delay. If Tumbleweed is delayed at any time during
Phase I or Phase II of the Project by supervening conditions beyond Tumbleweed's
reasonable control, and arising without its fault or negligence after the
execution hereof, including acts of God, civil commotion, strikes, labor
disputes, or governmental demands or requirements, then upon notice from
Tumbleweed to UPS, the affected Implementation Schedule date(s) will be
reasonably extended to accommodate such delays, not to exceed a day-for-day
extension for each such delay and all such extensions pursuant to this sentence
not to exceed, in the aggregate, ten (10) days. If Tumbleweed will be delayed
by more than ten (10) days, in the aggregate, during Phase I or Phase II of the
Project by supervening conditions beyond Tumbleweed's reasonable control,
including acts of God, civil commotion, strikes, labor disputes, or governmental
demands or requirements, then Tumbleweed may request that the affected
Implementation Schedule date(s) be further extended. UPS shall review such
request with Tumbleweed at the appropriate conference call (or meeting) provided
for in Section 2(i) above, and shall grant an extension of time commensurate
with the circumstances, subject to the following conditions:
(A) The cause of the delay (i) is beyond Tumbleweed's control and arises
without its fault or negligence, and (ii) arises after the execution
hereof;
(B) Tumbleweed demonstrates that the affected Implementation Schedule
date(s) will be actually and necessarily delayed; and
(C) Tumbleweed provides a written request to UPS in conjunction with the
next progress report provided for in Section 2(i) above after the time
Tumbleweed knows of any cause or circumstances which might, under
reasonable foreseeable circumstances, result in a delay. If
Tumbleweed shall fail to give the foregoing notice, the right to
request an extension for such cause shall be waived.
If either party is delayed at any time in the performance of its
obligations hereunder subsequent to Phase II of the Project by the failure of
the other party to perform its obligations under this Agreement, or by
supervening conditions beyond such party's reasonable
UPS/Tumbleweed Confidential 10 December 18, 1997
control, including acts of God, civil commotion, strikes, labor disputes, or
governmental demands or requirements, then the parties shall review the cause of
such delay at the appropriate conference call (or meeting) provided for in
Section 2(i) above, and an extension of time commensurate with the circumstances
shall be provided, subject to the following conditions:
(X) The cause of the delay is beyond the control of the party requesting
the extension of time and arises without its fault or negligence; and
(Y) The party requesting the extension demonstrates that the affected
obligation(s) will be actually and necessarily delayed.
Any delay by Tumbleweed in the performance of its obligations
hereunder as a result of (i) any failure by UPS, its Affiliates or Associates to
perform their express obligations under this Agreement; or (ii) by any
supervening condition beyond Tumbleweed's reasonable control, and which failure
or condition satisfies the applicable requirement(s) set forth above in this
subsection (j) shall be deemed an "Excusable Delay," with respect to
Tumbleweed's performance. Unless otherwise agreed by the parties, in the event
of an Excusable Delay, Tumbleweed shall proceed continuously and diligently with
the performance of the unaffected portions of its obligations under this
Agreement.
Notwithstanding the foregoing, UPS shall have the right to terminate
this Agreement, or any Phase hereunder or Maintenance Services (hereinafter
defined), as applicable, without liability to Tumbleweed (except as expressly
set forth in this paragraph), in the event that any Excusable Delay materially
adversely affects UPS's ability to offer the Messaging Service, whereupon (i) if
such Excusable Delay occurs prior to acceptance of Phase II of the Project, (x)
if such Excusable Delay is due to UPS's or its Affiliates' or Associates'
failure to perform the obligations set forth in Exhibit D hereto, Tumbleweed
shall be entitled to payment of the Initial Phase Development Fee described in
Section 6(g) in full, but shall refund to UPS any License Fees previously paid
pursuant to Section 6(a), in which case all licenses granted hereunder shall
terminate, Section 15 terminates, and neither party shall have any further
obligations to the other, and (y) if such Excusable Delay is not due to any such
failure by UPS. Tumbleweed shall refund to UPS all amounts paid hereunder, in
which case all licenses granted hereunder shall terminate, Section 15
terminates, and neither party shall have any further obligations to the other;
(ii) in the event that such Excusable Delay occurs in connection with any
subsequent Phase of the Project, and if such Excusable Delay is not due to any
failure by UPS or its Affiliates or Associates to perform the obligations set
forth in the relevant Specifications, Tumbleweed shall refund to UPS all amounts
paid with respect to such Phase; and (iii) in the event that such Excusable
Delay involves the provision of Maintenance Services by Tumbleweed, Tumbleweed
shall refund to UPS a pro rata amount (calculated on a daily basis) of any
annual Maintenance Service fees previously paid by UPS for the period in which
such termination is effective. Such foregoing termination (and associated
refund, if applicable) shall constitute UPS's sole and exclusive remedy for any
Excusable Delay which materially adversely affects UPS's ability to offer the
Messaging Service.
UPS/Tumbleweed Confidential 11 December 18, 1997
k. TERMINATION OF DEVELOPMENT SERVICES. UPS may terminate the
software development Services of Tumbleweed for any reason whatsoever during any
Phase beyond Phase II of this Agreement by not less than [ * ] written
notice to Tumbleweed specifying the date upon which termination becomes
effective. In the event of any termination during any such Phase, Tumbleweed
shall be entitled to payment, on a time and materials basis, for Services
rendered by Tumbleweed prior to the effective date of termination; provided,
however, that payments for such Phase shall not exceed the maximum amount
specified in the applicable Specifications, and such payments shall constitute
full settlement of any and all claims of Tumbleweed of every description arising
out of or relating to the termination of such Phase, including without
limitation, claims for lost profits.
3. MODIFICATIONS TO SPECIFICATIONS.
a. PROCEDURES. No changes in or deviations from the Specifications
shall be permitted unless the UPS Project Coordinator shall submit a written
request to Tumbleweed setting forth with reasonable specificity any requested
changes to such Specifications. Alternatively, a proposal for such a change or
deviation submitted in writing by Tumbleweed and accepted in writing by UPS
shall suffice for this purpose. As soon as reasonably practicable, but in no
event later than ten (10) days following Tumbleweed's receipt of such request
(unless a longer period is reasonably required), Tumbleweed shall provide UPS
with written notice stating any anticipated change in price, schedule, or any
other terms of the Specifications resulting from the requested changes. All
changes and adjustments required by Tumbleweed in its notice shall be made by
Tumbleweed in good faith.
b. ACCEPTED CHANGES. Unless UPS accepts in writing any changes in
price, schedule, or other terms set forth by Tumbleweed in its notice, the
changes to the Specifications shall not be made. If such changes are accepted
in writing by UPS, the changes to the Specifications shall be made, and UPS's
written request for such changes and Tumbleweed's written acceptance thereof
shall be deemed to constitute an amendment to the Specifications and shall be
deemed to be a part of this Agreement.
4. IMPLEMENTATION AND ACCEPTANCE.
a. IMPLEMENTATION SCHEDULE. The Implementation Schedule attached
hereto as Exhibit D sets forth the timing requirements for the various stages of
the completion of Phase I and Phase II of the Project. In the event any
milestone set forth in the Implementation Schedule is not met due to any delay
caused by Tumbleweed, in addition to damages for the delay (if applicable), as
provided for in Section 4(b) below, Tumbleweed shall [ * ].
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omitted from the public filing and have been filed separately with the
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UPS/Tumbleweed Confidential 12 December 18, 1997
Additionally, Tumbleweed shall use commercially reasonable efforts to ensure
that such delay does not result in slippage of later milestones.
b. ACCEPTANCE TESTING. Tumbleweed shall notify UPS in writing when
Tumbleweed has completed the final version of the Software associated with any
Phase of the Project such that it is ready for acceptance testing by UPS. UPS
shall then promptly conduct the acceptance tests provided for in the Detailed
Design Specifications (the "Acceptance Tests") to determine whether or not the
Software, Documentation and other deliverables to be provided pursuant to such
Phase materially conform to the Detailed Design Specifications (the "Acceptance
Standard"). The Acceptance Tests shall be conducted over a period not to exceed
thirty-five (35) days (the "Acceptance Test Period"), and may consist both of
testing by UPS in a test environment and beta testing by allowing a limited
number of customers to process Transactions using the Software in a product
environment. In the event that the applicable Software, Documentation and other
deliverables materially conform to the Acceptance Standard, UPS shall notify
Tumbleweed in writing that same have passed the Acceptance Tests. In the event
that UPS does not provide notice of rejection of any Phase of the Project by the
end of the Acceptance Test Period for such Phase, such Phase shall be deemed
accepted.
In the event that the Acceptance Tests reveal that the applicable
Software, Documentation and other deliverables, or any portion thereof, to be
provided pursuant to any Phase do not materially conform to the Acceptance
Standard, then UPS shall so notify Tumbleweed in writing specifying the nature
of such failure, and Tumbleweed shall have [ * ] to correct such failure
after which UPS shall have [ * ] to repeat the Acceptance Tests
according to the above process; provided, however that UPS will use reasonable
efforts to notify Tumbleweed as promptly as possible during the initial
Acceptance Test Period when and as such failures are identified. If the
Software, Documentation and other deliverables again fail to pass the Acceptance
Tests, UPS's sole and exclusive remedy shall be to elect one of the following
options in its sole discretion: (i) the parties may mutually agree that
Tumbleweed shall have an additional [ * ] to correct the failure, in
which case the above process (including, without limitation, these remedies)
shall be repeated; (ii) UPS may accept the applicable Software, Documentation
and other deliverables despite the nonconformities; (iii) the Acceptance Tests
associated with either Phase I or Phase II of this Agreement, UPS may terminate
the Agreement, whereupon UPS, at its sole option, may elect one (1) of the
following remedies: (X) Tumbleweed will [ * ] which amount is agreed by
the parties to be the deemed
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information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 13 December 18, 1997
amount of damages suffered by UPS as a result of such failure and not a penalty,
in which event all licenses granted hereunder shall terminate, Section 15 shall
terminate, and the provisions of Section 16(c) shall apply, or (Y) Section 15
shall continue to apply, in which event all licenses granted hereunder shall
terminate and the provisions of Section 16(c) shall apply, but Tumbleweed shall
not be obligated to pay to UPS the aforementioned [ * ] or (iv) for
Acceptance Tests associated with Phases beyond Phase II of this Agreement, UPS
may terminate such Phase(s), whereupon Tumbleweed will promptly refund to UPS
all amounts paid to Tumbleweed in connection with such Phase(s).
Notwithstanding anything to the contrary herein, acceptance of
Phase II shall be deemed to have occurred when UPS begins using the Software
associated with Phase II of the Project to support revenue generating customers
of the Messaging Service. Such date shall be defined as the "Commercial
Availability Date."
In the event that Tumbleweed fails to deliver the Software,
Documentation and other deliverables associated with Phase I or Phase II of
this Agreement by the final delivery date set forth in the Implementation
Schedule set forth in Exhibit D hereto, or in the event UPS elects option (i)
above with respect to Acceptance Tests associated with either Phase I or
Phase II of this Agreement, then as UPS's sole and exclusive remedy for any
delay in passing the Acceptance Tests associated with Phase I and Phase II of
this Agreement on or before the scheduled acceptance milestone date therefor
(as specified in the Implementation Schedule), UPS may elect one of the
following options in its sole discretion: (x) UPS may terminate this
Agreement, whereupon UPS, at its sole option, may elect one (1) of the
following remedies: (A) Tumbleweed [ * ], which amount is agreed by the
parties to be the deemed amount of damages suffered by UPS as a result of
such failure and not a penalty, in which event all licenses granted hereunder
shall terminate, Section 15 shall terminate, and the provisions of Section
16(c) shall apply, or (B) Section 15 shall continue to apply, in which event
all licenses granted hereunder shall terminate and the provisions of Section
16(c) shall apply, but Tumbleweed shall not be obligated to pay to UPS the
aforementioned [ * ]; or (y) the parties may mutually agree that
Tumbleweed shall continue performing, in which event UPS will be entitled to
deduct from the amounts otherwise payable hereunder, as damages for any delay
of up to thirty (30) days ("Delay Damages"), [ * ] for each calendar
day that the Software, Documentation and other deliverables associated with
Phase I or Phase II of this Agreement fail to pass the Acceptance Tests
beyond the scheduled milestone date therefor (as specified in the
Implementation Schedule). The foregoing Delay Damages are agreed by the
parties to be the deemed amount of damages suffered by UPS as a result of any
such delay of up to thirty (30) days and not a penalty. Any failure of the
Software, Documentation and other deliverables
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UPS/Tumbleweed Confidential 14 December 18, 1997
associated with Phase I or Phase II of this Agreement to pass the Acceptance
Tests within thirty (30) days of the scheduled acceptance milestone date
therefor (as specified in the Implementation Schedule, as such dates may be
extended pursuant to Section 2(j)) shall constitute non-delivery by
Tumbleweed.
c. INTERIM TESTING. For efficiency and project management purposes,
informal testing, in addition to the acceptance testing provided for herein, may
be conducted at various times as the work progresses, at Tumbleweed's
discretion, but neither such informal testing nor any provisional acceptance of
the results thereof by UPS shall constitute acceptance of any aspect of the
Software by UPS or relieve Tumbleweed of the responsibility to complete
successful acceptance tests on the Software, as a whole, as a precondition to
its entitlement to certain payments under this Agreement.
5. LICENSES AND PROPRIETARY RIGHTS.
a. SERVER SOFTWARE. Tumbleweed hereby grants to UPS a
non-exclusive, worldwide, royalty-bearing, perpetual (subject to termination
pursuant to the provisions hereof) license (the "License"): (i) to Use
[ * ] copies of the Server Software and Custom Server Software to
provide the Messaging Service, and shall include the right to operate the
Server Software and Custom Server Software on [ * ] processors and
[ * ] data center locations [ * ]; and (ii) to reproduce the Server
Software and Custom Server Software, and to distribute and sublicense same,
with equivalent rights to those enumerated in (i) to (x) any one or more of
UPS's Affiliates and/or Authorized Shipping Outlets, and (y) to any third
party which shall have been approved in writing by Tumbleweed in advance,
which approval shall not be unreasonably withheld, conditioned or delayed,
where such third party is one to which UPS outsources all or any portion of
the responsibility for operating the Messaging Service (collectively, "Server
Sublicensees"). All sublicenses granted by UPS under this Section 5(a) shall
include the minimum terms and conditions which are set out in Exhibit I
hereto. Upon request by UPS, Tumbleweed shall offer to provide maintenance
and support services to the Server Sublicensees on commercially reasonable
terms and conditions (including price). UPS shall not, nor shall it
authorize any third party to, decompile, reverse engineer or disassemble the
Server Software and/or Custom Server Software. UPS shall not remove, modify
or obscure any proprietary rights notices in the Server Software and/or
Custom Server Software, or any logos or trademarks displayed in such
Software, as long as no such notices are visually perceptible to end user
customers of UPS and its Server Sublicensees under this Section 5(a), except
to the extent expressly provided for in Section 7(c) hereof.
b. CLIENT SOFTWARE. In addition to the rights and licenses provided
for in Section 5(a) above, the License shall also include a License to Use and
to distribute and sublicense, either on a standalone basis or bundled with UPS's
products or services, and to provide services based upon, the Client Software
and Custom Client Software to any end users. Such License includes the right to
grant perpetual licenses to Use, sublicense and distribute copies of the Client
Software and Custom Client Software for an end user's use and permits UPS
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 15 December 18, 1997
to privately label the Client Software and Custom Client Software under UPS's
name and trademarks. Distribution of the Client Software and Custom Client
Software may be made by any means selected by UPS, including without limitation,
by making the Client Software and Custom Client Software available for download
from one or more FTP sites on the Internet, and by utilizing Affiliates,
Authorized Shipping Outlets, distributors, dealers, VARs, resellers,
subsidiaries or other third parties. To facilitate such distribution, the
License shall include the right for UPS to grant sublicenses to such Affiliates,
Authorized Shipping Outlets, distributors, dealers, VARs, resellers,
subsidiaries and third parties to Use the Client Software and Custom Client
Software for demonstration purposes. UPS shall license the Client Software and
Custom Client Software to end users in any manner which is commercially
acceptable for products distributed over or for use in connection with the
Internet, including without limitation, by written license agreements, which may
be either signed by UPS and the end user or included in the package containing
the product, or by the inclusion of license terms within copies of the Client
Software and/or Custom Client Software whereby the end user signifies his or her
acceptance by "clicking" on an "accept" button or performing some other action;
PROVIDED, HOWEVER, that each end user must sign a license agreement, open a
package containing the Client Software and/or Custom Client Software, "click" on
an "accept" button or perform some other action, at a minimum, designed to
signify its acceptance of the license terms and conditions with respect to such
Software which are set out in Exhibit E hereto. The parties acknowledge that in
the event future versions of the Client Software or Custom Client Software
incorporate additional software (which may be royalty-bearing or subject to
other limitations on use or distribution), or otherwise requires modification or
supplementation of the terms set forth in Exhibit E in order to reflect the
nature of such versions, the parties will mutually agree on any required
amendments to Exhibit E. Tumbleweed acknowledges that UPS is not guarantying
the enforceability of such terms and conditions against end users nor that the
methods of purported acceptance described above shall ultimately be found to
constitute acceptance of such terms and conditions. UPS shall not, nor shall it
authorize any third party to, decompile, reverse engineer or disassemble the
Client Software and/or Custom Client Software.
c. OWNERSHIP OF CUSTOM SOFTWARE. Unless otherwise stated in the
applicable Specifications, as between UPS and Tumbleweed, Tumbleweed shall own
all right, title and interest in and to all developments made during the course
of performing any work under this Agreement and UPS shall enjoy those licenses
provided for in this Agreement with respect to such developments. If the
parties mutually agree that UPS shall own one or more components of the Custom
Software produced during the course of Tumbleweed's performance of a Phase,
then, with respect to such components (and not with respect to any other
component), the following terms apply:
i. UPS INVENTIONS. Tumbleweed assigns and agrees to assign to UPS
all of Tumbleweed's and its Associates' entire right, title and
interest in and to the UPS Inventions, and any patents that may
be granted thereon in any country of the world. Tumbleweed shall
promptly share with UPS all information relating to such UPS
inventions. Tumbleweed also agrees to
UPS/Tumbleweed Confidential 16 December 18, 1997
acquire from its Associates who perform work hereunder, such
assignments, rights and covenants as to assure that UPS shall
receive the rights provided for in this Section 5(c)(i).
Tumbleweed agrees that upon UPS's request it will promptly have
its Associates sign all papers and perform all acts which may be
reasonably requested by UPS to enable UPS at its expense to file
and prosecute applications for patents on such UPS Inventions,
and to maintain patents granted thereon, provided that UPS shall
compensate Tumbleweed for the costs incurred by Tumbleweed that
are associated with such activities.
ii. UPS INFORMATION. Tumbleweed agrees to disclose and promptly
furnish to UPS any and all UPS Information originated by
Tumbleweed or any of its Associated hereunder. UPS shall own all
right, title and interest in and to the UPS Information created
by Tumbleweed hereunder, including all copyrights and proprietary
rights therein. Tumbleweed expressly acknowledges that the
parties have agreed that all aspects of the UPS Information and
all work in process in connection therewith are to be considered
"works made for hire" within the meaning of the Copyright Act of
1976, as amended (the "Act"), and that UPS is to be the "author"
within the meaning of such Act. All such copyrightable UPS
Information, as well as all copies of such UPS Information in
whatever medium fixed or embodied, shall be owned exclusively by
UPS as its creation, and Tumbleweed hereby expressly disclaims
any interest in any of them.
In the event (and to the extent) that the UPS Information created by
Tumbleweed hereunder or any part or element thereof is found as a
matter of law not to be a "work made for hire" within the meaning of
the Act, Tumbleweed hereby conveys and assigns to UPS the sole and
exclusive right, title and interest in the ownership to all such UPS
Information, and all copies of any of them, without further
consideration, and agrees to assist UPS to register, and from time to
time enforce (at UPS's expense), all copyrights relating to the UPS
Information created hereunder in any and all countries. Tumbleweed
shall place a copyright notice in favor of UPS on the UPS Information
at UPS's request.
d. OWNERSHIP OF CUSTOMER DATA. Tumbleweed agrees that all records,
files, reports and other data relating to UPS's customers which are received,
used or stored in connection with the Messaging Service or otherwise are the
exclusive property of UPS and its customers and that Tumbleweed hereby waives
any interest, title, lien or right to any such data or records. Customer
records and other data shall not be (i) used by Tumbleweed other than in
connection with supporting UPS's offering of the Messaging Service, (ii)
disclosed, sold, assigned, leased, or otherwise provided to third parties by
Tumbleweed, or (iii) commercially exploited by or on behalf of Tumbleweed, its
employees, subcontractors or agents.
UPS/Tumbleweed Confidential 17 December 18, 1997
e. TUMBLEWEED TRADEMARKS AND TRADE NAMES. Tumbleweed hereby grants
to UPS and its Affiliates and Authorized Shipping Outlets worldwide,
non-exclusive, non-transferable, non-sublicenseable, [ * ] licenses to
use and reproduce the Tumbleweed Marks in their advertising and promotion of the
Messaging Service and/or the Software, including without limitation, the right
to brand the Messaging Service by referencing the Tumbleweed Xxxx "Tumbleweed
Software." Tumbleweed acknowledges that (A) the licenses granted pursuant to
this Section 5(e) in no way, form or manner create or infer any obligation on
the part of UPS to use any of the Tumbleweed Marks, and (B) UPS shall have sole
discretion and control as to the size, location and position of its usage of the
Tumbleweed Marks, understanding that the Tumbleweed Marks will be prominently
and reasonably displayed. UPS acknowledges Tumbleweed's ownership and exclusive
rights in the Tumbleweed Marks, and UPS's use of the Tumbleweed's ownership and
exclusive rights in the Tumbleweed Marks, and UPS's use of the Tumbleweed Marks
shall inure to the benefit of Tumbleweed. UPS shall not adopt or attempt to
register any of the Tumbleweed Marks, as a whole, or adopt, use or attempt to
register any xxxx which is confusingly similar to any of the Tumbleweed Marks,
as a whole. For the period during which UPS is using any of the Tumbleweed
Marks, Tumbleweed shall have the right to monitor and observe UPS's operation of
the Messaging Service for the purpose of protecting and maintaining the
standards of quality established by Tumbleweed for products sold and services
rendered under the Tumbleweeds Marks as of the date UPS exercised its rights.
If UPS does not operate the Messaging Service in a manner consistent with
Tumbleweed's standards of quality, UPS shall be in breach of the terms of this
Section 5(e). Tumbleweed may immediately terminate this trademark license if
UPS breaches any of the terms of this Section 5(e) and does not either (i) cure
such breach within thirty (30) days after receiving notice thereof, or (ii)
discontinue any conduct in breach of the terms of this Section 5(e). UPS shall
include the symbols TM and -Registered Trademark- as appropriate at the first
instance of each use of each Tumbleweed Xxxx. UPS shall provide, at its own
expense, samples of Tumbleweed Xxxx usage for Tumbleweed to inspect from time to
time upon written request from Tumbleweed.
f. DEVELOPER KITS (AND LOCALIZATION KITS). Tumbleweed shall deliver
to UPS, at no charge therefor, such number of developer kit(s) and/or
localization kit(s) as shall be reasonably requested by UPS, which
developer/localization kit(s) shall be comprised of the Software described in
Exhibit C hereto and successor versions thereof, and any other
developer/localization kit software made generally commercially available by
Tumbleweed and successor versions thereof (collectively, the "Developer Kit
Software"), solely to permit UPS's development of localized versions of the
Software and/or applications to be deployed as part of or in support of the
Messaging Service. The License set forth in Sections 5(a) and (b) above
includes the right to modify, maintain, support, update and create Derivative
Works of the Software, to the extent enabled by the Developer Kit Software.
Tumbleweed grants to UPS a non-exclusive, perpetual, irrevocable right and
license (the "Developer Kit License") to Use the Developer Kit Software for
purposes of the development of localized versions of the Software and/or
applications to be deployed as part of or in support of the Messaging Service,
and for testing the operation of such localized versions and applications to be
deployed in connection with the Messaging Service, and to sublicense such right,
subject to mutually agreed upon
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 18 December 18, 1997
minimum terms and conditions, solely to permit third party developers working
directly on UPS's behalf to create localized versions of the Software and/or
applications for the Messaging Service. The Developer Kit License granted
hereunder specifically permits UPS and those third party developers working
directly on UPS's behalf, in addition to their other rights hereunder, to
develop localized versions of the Software and/or applications for the Messaging
Service which may utilize or require the use of the Developer Kit Software, or a
portion thereof, to operate ("Applications"), and to use or license or otherwise
permit third parties to use such Applications without royalty or payment to
Tumbleweed, except as expressly provided hereunder, even though such
Applications may contain portions or Derivative Works of the Developer Kit
Software. Except as set forth in this subsection (f), UPS shall have no right
to further sublicense, transfer, lease, sell, or in any way dispose of the
Developer Kit Software for any purpose other than as provided for in this
subsection (f), and furthermore agrees to direct any third parties who request
such Developer Kit Software to create software in support of the Standard
Software to Tumbleweed in order to procure licenses therefor directly from
Tumbleweed. UPS shall not, nor shall it authorize any third party to,
decompile, reverse engineer or disassemble the Developer Kit Software.
Notwithstanding anything to the contrary set forth in this Agreement,
neither UPS's development or localized versions of the Software nor its creation
of Applications relating to the Software, in either case prepared utilizing the
Developer Kit Software and/or APIs furnished by Tumbleweed, will, in any way,
form or manner, reduce or otherwise modify Tumbleweed's Maintenance Services or
other obligations hereunder with regard to the base Software, provided, however,
that Tumbleweed's obligations shall not extend to support of (i) the
Applications, (ii) localizations that have not been successfully certified by
Tumbleweed as set forth below, or (iii) modifications made to the base Software
to the extent not enabled by the Developer Kit Software. For quality control
purposes, however, UPS may submit each localized version to Tumbleweed, solely
for the purpose of Tumbleweed's testing and certification thereof, prior to
implementing same in support of the Messaging Service. Tumbleweed shall perform
such testing on a mutually agreeable schedule after the delivery of each
localized version of the Software, for which testing UPS shall reimburse
Tumbleweed for any costs and/or expenses (including personnel costs) reasonably
incurred by Tumbleweed in connection therewith, and either certify that such
localized version is in compliance with Tumbleweed's quality control
requirements (and that UPS may implement the localized version without affecting
any of Tumbleweed's Maintenance Services or other obligations hereunder), or
that such localized version is not in compliance with Tumbleweed's quality
control requirements, in which event Tumbleweed shall so notify UPS in writing
specifying the nature of such non-compliance and including sufficient details to
permit UPS to understand such non-compliance.
Furthermore, UPS may submit Applications to Tumbleweed for the limited
purpose of permitting Tumbleweed to test whether such Applications are
compatible with the APIs, and Tumbleweed shall perform such testing on a
mutually agreeable schedule, for which testing UPS shall reimburse Tumbleweed
for any costs and/or expenses (including personnel costs) reasonably incurred by
Tumbleweed in connection therewith.
UPS/Tumbleweed Confidential 19 December 18, 1997
Tumbleweed agrees to use its commercial discretion to make the
Developer Kit Software generally commercially available pursuant to a developer
support program designed to encourage third party developers to develop high
quality applications in support of, and localized versions of, the Standard
Software, and which will be conducted consistent with similar programs
maintained by comparable applications software vendors (e.g., [ * ]
g. INTERFACE INFORMATION. Tumbleweed will disclose UPS
[ * ], any and all APIs, communication protocols, interface
specifications or other such documentation (collectively, "APIs") necessary
to enable UPS to write Applications which interface/communicate with the
Software used by UPS to operate the Messaging Service. Tumbleweed grants to
UPS a non-exclusive, perpetual, irrevocable right and license (the "API
License") to internally Use the APIs solely to develop Applications which
interface/communicate with the Software used by UPS to operate the Messaging
Service, and for testing the operation of such Applications and to sublicense
such right, subject to the minimum terms and conditions of this Agreement
solely to permit third party developers working directly on UPS's behalf to
create Applications which interface/communicate with the Software used by UPS
to operate the Messaging Service. The API License granted hereunder
specifically permits UPS and the third party developers working directly on
UPS's behalf, in addition to their other rights hereunder, to develop
Applications which may utilize or require the use of any of the APIs to
interface/communicate with the Software, and to use or license or otherwise
permit third parties to use such Applications without royalty or payment to
Tumbleweed, even though such Applications will take advantage of such APIs to
interface/communicate with the Software. Except as set forth in this
subsection (g), UPS shall have no right to further sublicense, transfer,
lease, sell, or in any way dispose of the APIs for any purpose other than as
provided for in this subsection (g), and furthermore agrees to direct any
third parties who request such APIs to create software in support of the
Standard Software to Tumbleweed in order to procure licenses therefor
directly from Tumblewed. UPS shall not (except as expressly provided above),
nor shall it authorize any third party to, disclose, decompile, reverse
engineer or disassemble the APIs nor remove, modify or obscure any
proprietary rights notices in the APIs (so long as no such notices are
visually perceptible to end user customers (as opposed to third party
developers) of UPS).
Tumbleweed shall have an ongoing duty, during the term of this
Agreement, to update its provision of APIs, as required pursuant to this Section
5(g), to cover Enhancements to the Software which are made by Tumbleweed from
time to time. In addition, Tumbleweed's commitment to establish a developer
support program, as provided for in Section 5(f) above, shall also extend to the
APIs contemplated in this Section 5(g).
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 20 December 18, 1997
h. DOCUMENTATION LICENCES. Subject to the provisions of Section 10
hereof, Tumbleweed further grants to UPS and its Affiliates and Authorized
Shipping Outlets, during the term of this Agreement, the following
non-exclusive, worldwide rights and licenses: (i) to access, reproduce, display
and otherwise use the Documentation and other written materials furnished to UPS
hereunder; (ii) to modify, update and/or create Derivative Works of such
Documentation and other written materials; and (iii) to sublicense, lease,
sublease and distribute such Documentation and other written materials and to
permit their respective customers to enjoy the same rights and licenses with
respect thereto as are set forth in (i) above.
i. UPS INTELLECTUAL PROPERTY. UPS hereby grants to Tumbleweed a
limited, non-exclusive, non-transferable, fully-paid license to use those
portions of the trademarks, service marks, other indicia of origin, copyrighted
material and art work owned or licensed by UPS and any additional technical
information (the "UPS Intellectual Property") which are deliverable by UPS to
Tumbleweed solely to the extent necessary for Tumbleweed to develop the Customer
Software hereunder. Tumbleweed shall not use the UPS Intellectual Property for
any other purpose.
j. NO OTHER LICENSES. Except as otherwise provided in this
Agreement and/or in the exhibits hereto, both parties and their respective
suppliers shall retain all rights, title and interest in and to all copyrights,
trademarks, trade secrets, patents and all other industrial and intellectual
property embodied in or appurtenant to the Software and/or any other materials
or information provided by any such parties hereunder. There are no implied
licenses under this Agreement, and any rights no expressly granted hereunder are
reserved by the parties or their respective suppliers.
6. FEES AND PAYMENT.
a. LICENSE FEE. As consideration for the License to the Software
granted herein, and for the rights granted in Section 15, UPS shall pay to
Tumbleweed a license fee of [ * ] (the "License Fee") in the following
installments:
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 21 December 18, 1997
i. [ * ] upon the execution and delivery of the memorandum
of understanding between the parties, dated [ ]*,
receipt of which payment is hereby acknowledged by Tumbleweed;
ii. [ * ] upon the execution and delivery of this Agreement;
iii. [ * ] upon UPS's acceptance of the Software associated
with Phase I of this Agreement pursuant to Section 4(b) hereof;
and
iv. [ * ] upon UPS's acceptance of the Software associated
with Phase II of this Agreement pursuant to Section 4(b) hereof.
All such payments due hereunder shall be invoiced by Tumbleweed to UPS, and
shall be payable within fifteen (15) days after its receipt.
b. ROYALTIES. As additional consideration for the License to the
Software granted herein, UPS shall pay Tumbleweed as a royalty (the "Royalty")
the following percentage of the [ * ](hereinafter defined) actually
received by UPS and/or its Affiliates for [ * ] by the Messaging Service
utilizing the Software, based upon the [ * ] processed during the term
of this Agreement:
[ * ]
As used in this Section 6(b), [ * ].
c. [ * ]
d. ROYALTY PAYMENTS. All Royalties shall be computed and paid to
Tumbleweed monthly on the fifteenth (15th) day following the end of each
calendar month for Net Fees received by UPS during such calendar month for
license fees for the Software [ * ]. UPS shall have the right
to set off, deduct, retain, or withhold from any
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 22 December 18, 1997
accrued Royalties or other amounts otherwise payable hereunder, any monies due
by Tumbleweed hereunder and/or credits available to UPS hereunder until such
monies have been paid and/or credits applied.
e. ROYALTIES. At least monthly, a report shall be provided to
Tumbleweed showing the basis of the computation of Tumbleweed's Royalties. In
making such report, UPS shall be entitled to report only [ * ], the
Net Fees received for licenses granted with respect to the Custom Software, the
number of end users registered to use the Messaging Service as of the end of the
applicable month, [ * ], all of which information shall bee deemed
to be the Confidential Information of UPS and its Server Sublicensees.
Tumbleweed shall be entitled, not more than once annually, to retain one of the
"Big 6" public accounting firms (or any other independent certified public
accountant, if such other independent certified public accountant is reasonably
acceptable to UPS) to review the books and records of UPS and any applicable
Affiliates relating to the Messaging Service solely for the purpose of verifying
the accuracy of the Royalties calculated, paid or due to Tumbleweed under this
Agreement. Said certified public accountant shall inform Tumbleweed only
whether all Royalties have been paid and the amount of any underpayment or
overpayment. Such review shall be conducted during normal business hours upon
reasonable notice of at least one (1) month. Upon presentation of reasonable
proof of underpayment or overpayment, such underpayment or overpayment shall be
reflected in the next monthly Royalty payment. The cost of such audit shall
normally be at Tumbleweed's expense; provided, however, that UPS will bear the
cost of the audit if the audit reveals any underpayment or overpayment which, in
the aggregate, is greater than five percent (5%) of the amount of which was
actually due for the period being audited. If the audit reveals an underpayment
in excess of five percent (5%) of the amount which was actually due for the
period being audited, Tumbleweed shall also have the right to conduct another
audit within the same twelve (12) month period.
f. DEMONSTRATION AND INTERNAL USE. Notwithstanding the Royalties
provided for in subsection (b) above, and notwithstanding the minimum message
fee provided for in subsection (c) above, UPS shall [ * ]
obligation (i) for any [ * ] performed by UPS's and its Affiliates'
employees sending internally generated documents via the Messaging Service, (ii)
for any [ * ] performed by UPS's and its Affiliates' employees,
distributors, dealers, VARs and resellers, and by Authorized Shipping Outlets,
sending documents via the Messaging Service for demonstration purposes only, or
(iii) for any [ * ] performed by prospective customers sending documents
via the Messaging Service pursuant to limited, pre-defined evaluation plans
established by UPS from time to time, where such limited evaluation plans are
designed to increase the number of revenue generating customers of the Messaging
Service [ * ]
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 23 December 18, 1997
g. INITIAL PHASE DEVELOPMENT FEE. As consideration for the Phase I
and Phase II development Services rendered by Tumbleweed pursuant to Section 2
of this Agreement, UPS shall pay to Tumbleweed a fixed price development fee of
[ * ] (the "Initial Phase Development Fee"). The Initial Phase
Development Fee shall be payable in installments in accordance with the
milestone payment schedule set forth in the Implementation Schedule, and each
installment shall be payable upon completion of each milestone by Tumbleweed
and, if applicable, acceptance by UPS in accordance with Section 4. All such
payments due hereunder shall be invoiced by Tumbleweed to UPS.
h. DEVELOPMENT FEES FOR SUBSEQUENT PHASES. Upon mutual agreement as
to terms and conditions (including price) for the development of Software beyond
that required for Phase II of the Project, unless the parties otherwise agree to
the contrary, Tumbleweed will invoice UPS, monthly in arrears, for Services
provided to UPS by Tumbleweed in connection with Phases for which the agreed
upon Specifications therefor specify that Services performed in connection
therewith are to be performed on a time and materials basis, in accordance with
the daily rate and work schedule set forth in the Specifications. In the event
that the parties agree to Services on a fixed price basis, Tumbleweed will
invoice UPS in accordance with the schedule of payments set forth in such
Specifications. For Services agreed by the parties to be provided on a time and
materials basis, Tumbleweed shall submit with each invoice, copies of time
reports which relate to the Services being invoiced, together with supporting
documentation for all associated reimbursable expenses, which shall be limited
to reasonable out-of-pocket expenses necessarily and actually incurred by
Tumbleweed in the performance of such Services. Notwithstanding anything to the
contrary contained herein, UPS shall not be liable for any charges and/or
expenses in connection with any Phase for work done on a time and materials
basis in excess of the maximum dollar amount specified in the associated
Specifications, unless previously authorized by UPS.
i. SOFTWARE MAINTENANCE AND SUPPORT SERVICES. As consideration
for the Software maintenance and support Services (excluding the services of
the Dedicated Support Personnel) rendered by Tumbleweed pursuant to Section 9
hereof ("Maintenance Services") for the period ending as of [ * ],
UPS shall pay to Tumbleweed a fee of [ * ], [ * ] of which
shall be due and payable upon expiration of the Warranty Period for the
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 24 December 18, 1997
Phase II Software, as provided for in Section 8(a) below, and [ * ] of
which shall be paid in quarterly installments of [ * ] each, with the
first such installment becoming due and payable on [ * ]. As
consideration for the Maintenance Services rendered by Tumbleweed for subsequent
years, if so elected by UPS, UPS shall pay to Tumbleweed an annual fee of
[ * ] per year, payable in quarterly installments of [ * ]
each; provided, however, that in the event such Maintenance Services obligations
increase (whether by inclusion of additional data centers to be supported,
additional software, or the like, as long as the increased burden on
Tumbleweed's resources or risk can be substantiated) or the burden of providing
such Maintenance Services decreases (whether by reduced demand for telephone
support or otherwise), the parties shall meet to mutually agree upon a
reasonably adjustment to such fee. All payments due hereunder shall be invoiced
by Tumbleweed.
j. DEDICATED SUPPORT PERSONNEL. As consideration for the Services
of the Dedicated Support Personnel, as such Services are more specifically
described in Section 9(d), UPS shall bear [ * ] of Tumbleweed's actual
costs and expenses (including salary, employment taxes, unemployment insurance,
and all fees and costs normally associated with the employment of personnel or
hiring of independent contractors) attributable to the employment of such
Dedicated Support Personnel. Tumbleweed shall invoice UPS on a monthly basis
for the amounts required under this Section 6(j).
k. EXPENSES. Where this Agreement provides that UPS shall reimburse
Tumbleweed for various expenses incurred in connection with certain activities
hereunder, such expenses shall be limited to reasonable out-of-pocket expenses
necessarily and actually incurred by Tumbleweed in the performance of such
activities, provided that: (i) UPS has given its prior consent for any such
expenses, which consent shall not be unreasonably withheld; (ii) such expenses
are consistent with UPS's then-current travel and expense guidelines; and (iii)
if requested by UPS, Tumbleweed submits supporting documentation to UPS for such
expenses. It is understood that any air transportation reimbursable hereunder
shall be coach-economy and that entertainment by or on behalf of Tumbleweed
shall be at no cost to UPS.
l. COMMISSION FOR REFERRALS. In the event that UPS refers one of
its end user customers who has been using the Messaging Service for a period of
less than twenty-four (24) months and who has had a significant presence of
individual users of the Messaging Service at that customer (a "Referral
Customer") to Tumbleweed, and such Referral Customer licenses software or
procures services from Tumbleweed, Tumbleweed hereby agrees to pay to UPS, for
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 25 December 18, 1997
such referral, a commission of [ * ] for each individual account
that switches their account from the Messaging Service and [ * ] for the
new accounts, of the fees actually received by Tumbleweed from such Referral
Customer during the first year that such Referral Customer licenses software or
procures services from Tumbleweed. All commissions shall be computed and paid
to UPS monthly on the fifteenth (15th) day following the end of each calendar
month for fees received by Tumbleweed from Referral Customers during such
calendar month. At least monthly, a report shall be provided to UPS showing the
basis of the computation of UPS's commissions. UPS shall be entitled, not more
than once annually, to retain one of the "Big 6" public accounting firms (or any
other independent certified public accountant, if such other independent
certified public accountant is reasonably acceptable to Tumbleweed) to review
the books and records of Tumbleweed relating to such transactions solely for the
purpose of verifying the accuracy of the commissions paid or due to UPS under
this Agreement. Said certified public accountant shall inform UPS only whether
all commissions have been paid and the amount of any underpayment or
overpayment. Such review shall be conducted during normal business hours upon
reasonable notice of at least one (1) month. Upon presentation of reasonable
proof of underpayment or overpayment, such underpayment or overpayment shall be
paid to UPS or refunded by UPS, respectively. The cost of such audit shall
normally be at UPS's expense; provided, however, that Tumbleweed will bear the
cost of the audit if the audit reveals any underpayment or overpayment which, in
the aggregate, is greater than five percent (5%) of the amount which was
actually due for the period being audited. If the audit reveals an underpayment
in excess of five percent (5%) of the amount which was actually due for the
period being audited, UPS shall also have the right to conduct another audit
within the same twelve (12) month period.
m. SALES AND USE TAXES. All fees stated herein and Royalty payments
made hereunder exclude, and UPS shall pay, any sales, use, or similar tax,
federal state or local, that may be assessable in connection with this
Agreement, exclusive of taxes based on or measured by Tumbleweed's net income.
n. PAYMENT TERMS. All fees stated in, and shall be made in, U.S.
Dollars. Unless otherwise specified, all payments hereunder (including, without
limitation, Royalty payments) shall be due and payable within fifteen (15) days
of the date of UPS's receipt of Tumbleweed's invoice; provided, however, that
Royalty payments shall be made in accordance with Section 9(d).
o. PAYMENT DISCREPANCIES. UPS shall not be obligated to make
payments required hereunder to the extent and for the duration that such
payments are in dispute in good
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 26 December 18, 1997
faith; provided, however, that in the event of any such discrepancy or dispute,
UPS shall be required to make payments required hereunder on any undisputed
portion of any properly rendered invoice for which payment is due. In the event
that any payment discrepancy or dispute may be resolved by audit, then
Tumbleweed shall have the right to institute an audit pursuant to subsection (e)
above to verify the accuracy of the amounts paid or due to Tumbleweed under this
Agreement. If the audit confirms an underpayment by UPS, UPS shall pay to
Tumbleweed the amount of such underpayment within thirty (30) days of the date
of UPS's receipt of auditor's written findings. If UPS fails to make such
payment within such thirty (30) day period, Tumbleweed may terminate this
Agreement without liability for such termination. In the event such discrepancy
or dispute is not susceptible to resolution by accounting audit, the parties
shall engage in the escalation procedures set forth in Section 16(b).
p. TIME AND MATERIALS FEES. For Services provided by Tumbleweed on
a time and materials basis, the fees for such Services will be at commercially
reasonable rates.
7. MARKETING, DISTRIBUTION AND OFFERING OF MESSAGING SERVICE.
a. MARKETING PLAN. UPS will, in its sole discretion, develop a
marketing plan for the Messaging Service, including development of brand name
identities, and identifying likely markets, distribution channels, and pricing
structures for the Messaging Services; provided, however, that UPS will consult
with Tumbleweed with respect to the promotion and advertising of the Messaging
Service and that UPS will not market the Messaging Service as "free." Subject
to the foregoing, UPS shall have the sole determination of the marketing
strategies to be followed, including the extent to which UPS will use the
Tumbleweed Marks in connection with such marketing; provided, however, that,
[ * ] the Tumbleweed Xxxx "Tumbleweed Software" [ * ]
of advertising, collateral and promotional materials published by UPS and/or its
Affiliates and Authorized Shipping Outlets in relationship to UPS's "Document
Exchange" service offering, [ * ] shall be within UPS's sole
discretion. Notwithstanding the foregoing commitment, UPS shall have the right
to immediately discontinue its use of any or all of the Tumbleweed Marks,
[ * ] of advertising, collateral and promotional materials, in the
event that any of the Persons or entities identified in Section 15 of this
Agreement begin marketing products and/or services involving Internet or
Intranet delivery systems utilizing any of the Tumbleweed Marks, or in the event
that any act, omission or misrepresentation on the part of Tumbleweed or any of
its officers, directors, agents or employees directly and negatively impacts
upon the goodwill associated with any of UPS's trade names, trademarks and/or
service marks, as determined by UPS in its sole but reasonable discretion.
Tumbleweed agrees to include a direct link to the
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information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 27 December 18, 1997
Messaging Service on Tumbleweed's "Posta" homepage on the World Wide Web. In
addition, Tumbleweed agrees to participate in major sales calls by UPS, as
reasonably requested by UPS. The foregoing shall not in any way limit UPS's
obligations, pursuant to Section 7(c) below, to display the "Tumbleweed Posta"
xxxx in the Software.
b. DISTRIBUTION OF CLIENT SOFTWARE. The License granted pursuant
to Section 5(b) of the Agreement permits UPS to reproduce the client-based
portion of the Software, which reproduction may be in any form and on any media
deemed suitable by UPS for distribution. UPS shall not be obligated to offer
the Messaging Service in all formats, or for all computer systems, but shall
select those which, in its judgment, are deemed most suitable for the Messaging
Service. All costs of packaging and reproduction of the client-based Software
shall be borne by UPS, and subject to compliance with all license restrictions
in this Agreement, UPS shall have complete discretion in selecting the parties
by whom and the circumstances under which and the means by which the
client-based Software is reproduced for distribution, including without
limitation, by making the client-based Software available for download from one
or more FTP sites on the Internet.
c. TRADEMARK USAGE. Unless and until any of the Persons
identified in Section 15 of this Agreement begin marketing products and/or
services involving Internet or Intranet delivery systems utilizing any of the
Tumbleweed Marks, and unless and until any act, omission or misrepresentation on
the part of Tumbleweed or any of its officers, directors, agents or employees
directly and negatively impacts upon the goodwill associated with any of UPS's
trade names, trademarks and/or service marks, as determined by UPS in its sole
but reasonable discretion, UPS agrees Tumbleweed display the Tumbleweed Xxxx
"Tumbleweed Posta" in the Software, and in the HTML pages created thereby,
provided that the manner in which such Tumbleweed Xxxx appears (e.g., size,
location, etc.) shall be within UPS's sole but reasonable discretion, subject to
Tumbleweed's reasonable approval.
d. END USER SUPPORT. UPS shall assume sole responsibility for all
first level customer support of all sublicensees and end user customers of the
Messaging Service, at its own expense; provided, however, that Tumbleweed agrees
to promptly provide UPS with second level support to assist UPS with customer
support problems which cannot be dealt with at the first level due to their
complexity or their unusual nature, or due to errors or other malfunctions in
the Software which can only be corrected by Tumbleweed. Tumbleweed will
redirect to UPS any customer support questions it receives from end user
customers of the Messaging Service.
e. MARKETING FLEXIBILITY. UPS shall have full freedom and
flexibility in its marketing effort for the Messaging Service, including,
without limitation, the freedom to decide its methods of marketing and pricing,
and to decide whether to market or discontinue marketing the Messaging Service
or any particular subset of the Messaging Service. Subject to complying with
the express requirements of this Agreement, Tumbleweed shall have full freedom
and flexibility in its support of UPS's marketing effort for the Messaging
Service, including, without
UPS/Tumbleweed Confidential 28 December 18, 1997
limitation, the freedom to decide its methods of marketing support, and to
decide whether to support or discontinue supporting UPS's marketing of the
Messaging Service or any particular subset of the Messaging Service. Neither
party makes any guarantee or commitment as to the success of its marketing
effort, and each party agrees that the other party has no obligation to it
whatsoever other than as specifically provided in this Agreement.
f. ADDITIONAL MARKETING AND SALES SUPPORT. For the period ending
(1) year after the Commercial Availability Date, in addition to its other
marketing and sales support obligations hereunder, Tumbleweed shall provide the
Services set forth in Exhibit G hereto.
8. WARRANTIES. Tumbleweed hereby warrants and represents to UPS as
follows:
a. SOFTWARE. All Software and Documentation delivered pursuant to
this Agreement will materially conform to the Detailed Design Specifications
therefor. In the event of any breach of the foregoing warranty, Tumbleweed
shall use commercially reasonable efforts to promptly correct or replace the
Software so that it materially conforms with the Detailed Design Specifications.
As the Internet transmission medium and servers connected thereto are not
entirely free form unauthorized access, Tumbleweed does not warrant that
operation of the Software will be uninterrupted, secure, or error-free, or that
all errors will be corrected, and further does not warrant that the information
stored or transmitted by the Software will be free from unauthorized
modification. The warranty set forth in this Section 8(a) shall remain in
effect for the period ending [ * ] following acceptance of Phase II
of the Project pursuant to Section 4(b) hereof (the "Warranty Period"), and for
the period during which Tumbleweed is providing continuing support for the
Software pursuant to Section 9 below (the "Support Period"). The foregoing
warranty does not cover non-conformities due to: (a) any modification of the
Software performed by any Person other than Tumbleweed or any of its Associates
(except for localizations certified by Tumbleweed as set forth in Section 5(f)
and except for modifications to the base Software enabled by the Developer Kit
Software ); (b) operation of the Software under environmental conditions outside
of normal operating ranges for computer hardware for UPS's data center; (c) any
use of the Software on a system that does not meet Tumbleweed's minimum
standards for such Software, to the extent such minimum standards are included
in the Specifications; and (d) hardware or non-Tumbleweed software (where such
non-conformity is due solely to the operation of such hardware or non-Tumbleweed
software).
b. COMPATIBILITY. All Enhancements to the Software furnished
hereunder will be implemented in such a manner as to maintain backward
compatibility with the immedi-
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information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 29 December 18, 1997
ately preceding two (2) versions, and all versions of the Software furnished
hereunder and/or released within the previous year, and with any and all
associated interfaces within the Software to other vendors'; software and
hardware, as provided for in Section 5(g) hereof, in Exhibit C hereto, or in the
Detailed Design Specifications, so that such previous versions or interfaces
shall continue to be operable with the Software as Enhanced, in materially the
same manner and with materially equivalent performance as prior to the
Enhancement; provided, however, that Tumbleweed shall have satisfied such
obligation with respect to the preservation of an interface if it furnishes to
UPS, as an alternative to backward compatibility, the software retrofit(s)
necessary to preserve the functionality of applications written to such previous
interface. As used in this subsection (b), a "version" is any version of the
Standard Software designated, in Tumbleweed's sole but reasonable discretion, by
a change in the version number to the left of the first decimal point. On a
case by case basis, UPS agrees to consider, in good faith, reducing Tumbleweed's
two (2) version backward compatibility commitment to one (1) version for a
particular version release; provided, however, that no such reduction shall be
taken or held to extend to any subsequent version of the Software released by
Tumbleweed hereunder.
c. SERVICES. The work to be performed hereunder shall be of
professional quality and will conform to generally accepted standards for
software in the software development and software support fields.
d. Intentionally omitted.
e. RELIABILITY. During the Warranty Period and subsequent Support
Period, when UPS elects to secure the Services of the DSP at the Supported
Datacenter(s), in addition to the individual performance standards for the
Software set forth in the Detailed Design Specifications, Tumbleweed hereby
represents and warrants to UPS that the Software operating at such Supported
Datacenter(s) shall on an ongoing basis, operate without unresolved Critical or
Major Defects ("Uptime"), measured on a monthly basis, for an average of
[ * ]. For the purposes of determining Uptime, the following
formula shall be used:
Uptime = Unit Hours of Operation minus Downtime
(to be expressed --------------------------------------
as a percentage) Unit Hours of Operation
For the purposes of this Section 8(e), "Unit Hours of Operation" shall mean
twenty-four (24) hours per day, seven (7) days per week and "Downtime" shall
mean that period of time when the Messaging Service at the Supported
Datacenter(s) is inoperable (unavailable) for reasons
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information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 30 December 18, 1997
attributable to the Software. Downtime for each incident shall commence from
the time UPS has made a BONA FIDE attempt to notify Tumbleweed (or the DSP) that
the Messaging Service at the Supported Datacenter(s) is inoperable for reasons
attributable to the Software, and shall continue until the Messaging Service at
the Supported Datacenter(s) is restored to fully operable condition, but
Downtime shall specifically exclude any time (x) required to perform scheduled
maintenance upgrades (which shall be scheduled by UPS during non-peak hours for
the Messaging Service), or (y) spent as a result of any delay by UPS in
providing Tumbleweed or its DSP with access to the hardware and software at the
Supported Datacenter(s). UPS will consider, in good faith, any recommendations
made by Tumbleweed's DSP(s) with respect to the operation of the Supported
Datacenter(s), where such recommendations shall be limited to the requirements
of operating a data center for the Software in a professional manner consistent
with generally accepted standards for data center operation (including, but not
limited to, the operation of redundant "hot" servers for system integrity,
multiple data line access, regular backups, and the like). At a minimum, UPS
shall implement (i) the operation of redundant "hot" servers, (ii) automatic
regular backups, and (iii) automatic switching to redundant servers in the event
of a networking or hardware failure (the "Minimum Conditions").
f. Intentionally omitted.
g. LOCKS. Except to the extent disclosed in the applicable
Specifications, Tumbleweed has not inserted, and will not insert, in the
Software any lock, clock, timer, counter, copy protection feature, CPU serial
number reference, "Trojan horse," or other device which is intended to (i)
disable or erase all or any part of the Software; (ii) prevent UPS or its
Affiliates from fully utilizing all or any part of the Software, or prevent
UPS's customers for fully utilizing all or any part of the Client Software
and/or Custom Client Software; or (iii) require action or intervention by
Tumbleweed or any other Person to allow UPS or its Affiliates, or their
respective customers, to utilize all or any part of the Software on the type of
computer equipment indicated in Exhibits A and B hereto.
h. VIRUSES. Tumbleweed has used and will use all commercially
reasonable efforts to ensure that each copy of the Software delivered pursuant
to this Agreement is free of any computer "viruses."
i. MILLENNIUM. Tumbleweed warrants to UPS (and not to any other
parties) that Tumbleweed will use commercially reasonable efforts to ensure that
the Software will create, store, process, compare, calculate, sequence and
output data relating to (and including) dates on or after January 1, 2000,
without producing inaccurate results. The foregoing warranty only applies to
errors that are specifically attributable to date-specific data; if such errors
would be encountered with non-date-specific data, such errors are covered solely
by the other warranty and maintenance provisions of this Agreement. While the
exclusions applicable to such other warranty and maintenance provisions also
apply to this warranty, UPS acknowledges that inaccurate results also could be
caused by software and hardware being used with the Software (including without
limitation the BIOS or the operating system), and such inaccurate
UPS/Tumbleweed Confidential 31 December 18, 1997
results are not covered by the foregoing warranty. Any enhancement required to
enable that the Software to comply with this warranty will be considered part of
and covered under the maintenance provisions of this Agreement at no additional
charge to UPS.
j. WARRANTY DISCLAIMER. EXCEPT AS SET FORTH IN THIS AGREEMENT,
TUMBLEWEED AND ITS SUPPLIERS DISCLAIM ALL OTHER WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING WITHOUT LIMITATION THE IMPLIED WARRANTIES OF TITLE, MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT.
9. SOFTWARE SUPPORT SERVICES. Tumbleweed shall provide Maintenance
Services pursuant to this Section 9 for the period ending as of December 31,
1999, and on a year to year basis thereafter (collectively, the "Support
Period"), unless and until terminated by UPS upon at least ninety (90) days'
written notice to Tumbleweed prior to the commencement date of the next annul
Support Period. Tumbleweed agrees to make the Maintenance Services available to
UPS for the term of this Agreement.
a. NOTIFICATION OF DEFECTS. Tumbleweed will promptly (i) notify
UPS of any defects or malfunctions in the Software or Documentation of which it
learns from any source and which it reasonably expects to lead to a Critical
Defect or Major Defect, (ii) use commercially reasonable efforts to correct any
such defects or malfunctions, and (iii) upon the earliest availability of such
corrections, provide UPS with corrected copies of same.
b. ENHANCEMENTS. Tumbleweed will promptly provide to UPS, on or
before the date on which any such Enhancement is made generally available to any
of Tumbleweed's other customers, copies of the Software and Documentation
revised to reflect any Enhancements to the Standard Software which are to be
made generally available to Tumbleweed's other customers, including, without
limitation, modifications to the Software which can increase the speed,
efficiency or ease of operation of the Software or add additional functionality
or capabilities to or otherwise improve the functions of the Software, and
modifications to the Software which support new protocols, new operating systems
and/or new releases of the operating systems and other third party software with
which the Software is designed to operate or interface. In the event that
Tumbleweed develops an Enhancement for which it will owe a royalty based on the
distribution of such Enhancement (a "Royalty Enhancement"), Tumbleweed agrees to
offer the Royalty Enhancement to UPS on terms [ * ], and UPS
agrees to pay such royalty, [ * ] based solely upon UPS's use
of the Royalty Enhancement, in the event UPS elects to license such Royalty
Enhancement. Solely
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information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 32 December 18, 1997
with respect to the migration from version 1.0 of the Standard Software to
version 2.0 of the Standard Software, Tumbleweed shall perform [ * ]
modifications necessary to the Custom Software furnished hereunder,
[ * ] charge to UPS, to ensure that such Custom Software shall
continue to be operable with the Software as Enhanced, in materially the same
manner and with materially equivalent performance as Custom Software
associated with version 1.0 of the Standard Software. Further, Tumbleweed
hereby represents and warrants to UPS that version 2.0 of the Standard
Software, and the modified version of the Custom Software provided pursuant
to the previous sentence, shall have equivalent or greater functionality and
performance as version 1.0 of the Standard Software, and Custom Software
associated therewith, when operated on (A) SUN Ultra servers, with (B) the
SUN Solaris 2.6 operating system or above, with (C) Oracle 7.3 database (with
patch) or above, with (D) Netscape Enterprise Service 3.0C or above (backward
compatible to 2.01), and must support (E) NFS, and must support (F) separate
HTTP components (multiple web servers talking to the same file, system and
database), and must provide (G) same custom API services as Tumbleweed built
for UPS in version 1.0 (the functions do not have to be the same, but
functionality must be), and (H) Tumbleweed must provide expert assistance for
developing a distributed implementation using multiple HTTP components, and
(I) Tumbleweed must provide expert assistance for developing a redundant data
center recovery solution (the solution must be approved by the UPS
architecture group). With respect to subsequent Enhancements to the Standard
Software, subject to Section 8(b) above, UPS acknowledges that any work that
the parties mutually agree that Tumbleweed shall perform to conform the
Custom Software to any such subsequent Enhancement shall be performed as part
of a new Phase pursuant to Section 2 hereof. With respect to all
Enhancements, Tumbleweed shall provide procedures, such as database
conversion procedures where applicable, and any computer program(s) required
to assure a smooth and timely migration to the new environment (i.e.,
typically capable of being performed overnight).
c. SECOND LEVEL SUPPORT. UPS shall be solely responsible for
providing all first level support for its end user customers and for all aspects
of the Messaging Service which do not involve the Software. Except as set forth
in Section 9(d) below UPS shall further be responsible for first level support
of the Server Software and Custom Server Software. Tumbleweed will provide to
UPS, twenty-four (24) hours per day, seven (7) days per week, all telephone or
written consultation reasonably requested by UPS in connection with its use and
operation of the Software or any problems therewith which cannot be resolved a
the first level. UPS may designate up to two (2) employees per data center
operating the Server Software/Custom Server Software as its support interface(s)
("Support Interfaces") with Tumbleweed, which employee(s) shall initiate and
administer all requests for telephone consultation hereunder. Each UPS support
interface must complete the training specified in Section 12 hereof, and UPS's
end user support personnel shall have completed either the end user support
training specified in Section 12 hereof, or subsequent "train the trainer"
sessions conducted by UPS regarding end user support. In the event that
requests become excessive or overly burdensome as a result of lack of skill or
training by the Support Interface(s), or high rate of turnover of such Support
Interface(s), UPS and Tumbleweed personnel shall meet to provide solutions to
such problem.
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 33 December 18, 1997
d. SUPPORTED DATACENTER SUPPORT. In order to assist UPS in
performance of its first level support obligations for the Server Software and
Custom Server Software, Tumbleweed shall make available to UPS for a period of
[ * ] from the Commercial Availability Date, one Dedicated Support
Personnel at each Supported Datacenter(s) as UPS may so elect. Following such
[ * ] period, Tumbleweed shall continue to make the DSP(s) available to
UPS on a month to month basis unless and until UPS shall have provided at least
ninety (90) days' prior written notice to Tumbleweed of the termination of such
DSP Services with respect to one (1) or more Supported Datacenters. In the
event that UPS elects to discontinue DSP Services with respect to a particular
Supported Datacenter, the parties shall meet to mutually agree upon a reasonable
adjustment to the Reliability Warranty set forth in Section 8(e) hereof, and the
obligations and remedies set forth in Section 9(e)(ii) and (iii) shall no longer
apply, but be replaced by the obligations set forth in Section 9(e)(iv) and (v)
with respect to any such data center. The DSP(s) shall have as his, her or
their first priority the ongoing support and maintenance of the Software at the
Supported Datacenter, and shall be physically present at the Supported
Datacenter(s) during UPS Business Hours, and on call (i.e., available by pager)
outside of UPS's Business Hours. "Business Hours" are 8:00 a.m. to 6:00 p.m.,
local time, on Business Days. UPS shall provide to the DSP(s) physical access
to the server(s) running the Messaging Service at the Supported Datacenter(s),
as well as remote access to any other servers running the Messaging Service, in
all cases subject to compliance with UPS's reasonable security measures for such
access, remote or otherwise. To the extent that UPS declines or fails to
implement the Minimum Conditions (as defined above), Tumbleweed shall not be
liable for any response time commitments and associated remedies set forth in
Sections 9(e)(ii) and (iii). During the first five (5) days following
installation of the Software at each Supported Datacenter, the DSP shall be
physically present during UPS Business Hours to assist with the implementation
of the Messaging Service at such Supported Datacenter.
e. REMEDIAL EFFORTS BY TUMBLEWEED. Tumbleweed will respond to and
resolve problems with the Software in accordance with the following procedures:
i. UPS shall first attempt to identify and rectify the problem in
accordance with its first-level support obligations, which may include
consulting with the DSP. If such activities are unsuccessful, the DSP
(or one of UPS's Support Interfaces, if UPS is not then covered by
Tumbleweed's DSP Services pursuant to Section 9(d) above) shall
contact Tumbleweed to report such problem. If the problem may be
solved via a telephone consultation, Tumbleweed (or its DSP) shall
proceed to attempt to effect such resolution. If remote access is
required to permit Tumble-
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 34 December 18, 1997
weed to attempt to diagnose the problem, then subject to Tumbleweed's
compliance with UPS's security procedures then in effect, UPS shall
provide remote access to UPS's servers running the Messaging Service
solely for the purpose of enabling Tumbleweed to attempt to diagnose
and remedy reported problems remotely. Based on such remote
diagnosis, the parties shall confer to determine whether the Software
or some other component is responsible for any problems with respect
to the Messaging Service.
In the event that the problem does not arise at a Supported
Datacenter, and Tumbleweed informs UPS that the Software is not
responsible for the problem, and UPS nevertheless reasonably believes
that the Software is responsible for such problem and that such
problem is a Critical or Major Defect, and after all possible
diagnosis by Tumbleweed and discussion by the parties UPS insists that
on-site support is the only reasonable solution, Tumbleweed support
personnel shall promptly travel to the other UPS datacenter to attempt
to effectuate such repairs. In the event that after such travel it
becomes clear that the Software was not responsible for such problems
and Tumbleweed had informed UPS of such diagnosis prior to such
travel, as provided for above, UPS shall reimburse Tumbleweed for all
actual expenses incurred in the course of such service call as well as
time and materials charges related to the same. In the event that
such on-site service had been necessitated by a Critical or Major
defect caused by the Software, Tumbleweed shall bear all expenses
associated with such on-site call, but no time and materials charges
shall be payable in connection therewith.
Nothing provided for in this subsection (e)(i) shall have any effect
on the remedies available to UPS pursuant to subsections (e)(ii) and
(e)(iii) below, provided, however that Tumbleweed's obligations and
UPS's remedies set forth in subsections (e)(ii) and (e)(iii) below
shall apply only to Supported Datacenters;
ii. For a Supported Datacenter, with respect to Critical Defects, as
reasonably determined by UPS, Tumbleweed will respond to UPS's request
for service by telephone response by a qualified and knowledgeable
representative within one (1) hour from the time Tumbleweed receives
UPS's call and will complete such repairs expeditiously. Tumbleweed
personnel shall render continuous effort with respect to such
problems. If Tumbleweed does not respond and remedy such problem in
the Software within four (4) hours of receipt of the call , UPS shall
be entitled to a credit against future amounts due hereunder of
[ * ] the average hourly revenues generated by the Messaging
Service (measured over the prior three-month period) for every hour or
part thereof after four (4) hours that Tumbleweed fails to remedy such
problem. Monies becoming due UPS shall be applied as a credit against
any amounts subsequently due from UPS to Tumbleweed. Notwithstanding
the foregoing, in the event that Tumbleweed fails to remedy any such
problem within fifteen (15) days of receipt of the call, or in the
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 35 December 18, 1997
event that any such problem occurs four (4) or more times within any
six (6) month period, such failure shall be deemed to be a material
breach by Tumbleweed of this Agreement, in which event the foregoing
credits shall no longer accrue and UPS shall be entitled to pursue
such damages and remedies as UPS might have pursuant to this
Agreement, at law or in equity, subject to the limitations (including
the limitations on liability) set forth herein;
iii. For a Supported Datacenter, with respect to Major Defects, as
reasonably determined by UPS, Tumbleweed will respond to UPS's request
for service by telephone response by a qualified and knowledgeable
representative within two (2) hours from the time Tumbleweed receives
UPS's call and will complete such repairs expeditiously. Tumbleweed
personnel shall render continuous effort with respect to such
problems. If Tumbleweed does not respond and remedy such problem in
the Software within twenty-four (24) hours of receipt of the call, UPS
shall be entitled to a credit against future amounts due hereunder of
[ * ] the average hourly revenues generated by the Messaging
Service (measured over the prior three-month period) for every hour or
part thereof after twenty-four (24) hours that Tumbleweed fails to
remedy such problem. Monies becoming due UPS shall be applied as a
credit against any amounts subsequently due from UPS to Tumbleweed.
Notwithstanding the foregoing, in the event that Tumbleweed fails to
remedy any such problem within thirty (30) days of receipt of the
call, or in the event that any such problem occurs six (6) or more
times within any six (6) month period, such failure shall be deemed to
be a material breach by Tumbleweed of this Agreement, in which event
the foregoing credits shall no longer accrue and UPS shall be entitled
to pursue such damages and remedies as UPS might have pursuant to this
Agreement, at law or in equity, subject to the limitations (including
the limitations on liability) set forth herein;
iv. For locations other than Supported Datacenters, with respect to
Critical Defects, as reasonably determined by UPS, Tumbleweed will
respond to UPS's request for service by telephone response by a
qualified and knowledgeable representative within one (1) hour from
the time Tumbleweed receives UPS's call and will complete such repairs
within eight (8) hours. Tumbleweed personnel shall render continuous
effort with respect to such problems;
v. For locations other than Supported Datacenters, with respect to Major
Defects, as reasonable determined by UPS, Tumbleweed will respond to
UPS's request for service by telephone response by a qualified and
knowledgeable representative within two (2) hours from the time
Tumbleweed receives UPS's call and will complete such repairs within
forty-eight (48) hours. Tumbleweed personnel shall render continuous
effort with respect to such problems; and
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 36 December 18, 1997
vi. With respect to any other problem involving the Software (i.e., Minor
Defects), Tumbleweed will respond during Business Hours (hereinafter
defined) to UPS's request for service by telephone response by a
qualified and knowledgeable representative within four (4) hours from
the time Tumbleweed receives UPS's call and will use commercially
reasonable efforts to correct such Minor Defect(s) in the next
Enhancement of the applicable Software.
f. TERMINATION OF MAINTENANCE. UPS shall have the right to
terminate the maintenance provisions of this Agreement, without affecting its
Licenses to the Software granted under Section 5 hereof, at any time in the
event of a breach by Tumbleweed of any of its maintenance obligations hereunder
if Tumbleweed shall fail to cure such breach within thirty (30) calendar days of
receipt of written notice thereof. Except as expressly provided for in Section
9(e) above, any termination of the maintenance provisions of this Agreement by
UPS shall be in addition to any and all other legal or equitable remedies which
may be available to UPS. In the event that UPS has terminated the maintenance
provisions of this Agreement, and subsequently desires maintenance services,
Tumbleweed shall have the right to require that UPS first pay all maintenance
fees which would have been otherwise due during the interim and upgrade the
Software to the currently supported versions of the Software.
g. MAINTENANCE EXCLUSIONS. Tumbleweed will only provide Maintenance
Services for (x) the then-current version of the Software, (y) the immediately
preceding two (2) versions of the Software, and (z) all preceding versions of
the Software (in addition to the immediately preceding version) for a period of
[ * ] following the release of such preceding version(s). As used in
this subsection (h), a "version" is any version of the Standard Software
designated, in Tumbleweed's sole but reasonable discretion, by a change in the
version number to the left of the first decimal point. Furthermore, Maintenance
Services do not include any service required as a result of: (a) any
modification of the Software performed by any Person other than Tumbleweed or
any of its Associates (except for localizations certified by Tumbleweed as set
forth in Section 5(f) and except for modifications to the base Software enabled
by the Developer Kit Software); (b) operation of the Software under
environmental conditions outside of normal operating ranges for computer
hardware for UPS's data centers; (c) any use of the Software on a system that
does not meet Tumbleweed's minimum standards for such Software, to the extent
such minimum standards are included in the Specifications; or (d) the operation
of hardware or non-Tumbleweed software (where such non-conformity is due solely
to the operation of such hardware or non-Tumbleweed software). In the event
that Tumbleweed provides services that are shown to be due to a factor not
covered by the Maintenance Services enumerated in this Agreement, UPS shall pay
Tumbleweed's then-current time
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 37 December 18, 1997
and materials charges needed to perform such services; provided, however, that
Tumbleweed shall have informed UPS in advance that such services are not covered
by the maintenance provisions hereof, and UPS shall then have expressly
requested that Tumbleweed proceed to perform such services.
10. CONFIDENTIAL INFORMATION.
a. NON-DISCLOSURE OF TRADE SECRETS AND CONFIDENTIAL INFORMATION.
During the term of this Agreement, and indefinitely thereafter, Tumbleweed will
not use, copy, or disclose, or permit any unauthorized person access to, any of
UPS's Trade Secrets, except as expressly directed by UPS or as permitted herein
in connection with Tumbleweed's work hereunder. During the term of this
Agreement, and indefinitely thereafter, UPS will not disclose, or permit any
unauthorized person access to, any of Tumbleweed's Trade Secrets, except as
expressly authorized by Tumbleweed or as permitted herein. During the term of
this Agreement and for a period of two (2) years after termination thereof,
Tumbleweed will not use, copy, or disclose, or permit any unauthorized person
access to, any of UPS's Confidential Information, except as expressly directed
by UPS or as permitted herein in connection with Tumbleweed's work hereunder.
During the term of this Agreement and for a period of two (2) years after
termination thereof, UPS will not disclose, or permit any unauthorized person
access to, any of Tumbleweed's Confidential Information, except as expressly
authorized by Tumbleweed or as permitted herein. The use and disclosure
restrictions in this Section 10(a) shall not apply to Trade Secrets and/or
Confidential Information which (i) are known by the recipient prior to receipt
from the disclosing party, (ii) are or become, through no act or fault of the
recipient, publicly known or generally utilized by others, (iii) are received by
recipient from a third party without a restriction on disclosure or use, (iv)
are independently developed by recipient without reference to the Trade Secrets
and/or confidential Information, or (v) are required to be disclosed by a court
or government agency, provided that the recipient shall have given prior written
notice of such required disclosure to the disclosing party promptly upon the
recipient becoming aware of such requirement, and taken reasonable steps to
allow the disclosing party to seek to protect the confidentiality of the
information required to be disclosed.
b. RETURN OF MATERIALS. Each party acknowledges that all Trade
Secrets and Confidential Information of the other party are the property of the
other party or its affiliates and their respective licensors. All notes, data,
reference materials, sketches, disks, memoranda, tapes, manuals, files,
documentation and records in any way incorporating or reflecting any of the
Trade Secrets or Confidential Information of UPS and/or its Affiliates shall
belong exclusively to UPS and such Affiliates, and Tumbleweed agrees to turn
over all copies of such materials in Tumbleweed's possession or control to UPS,
or certify the destruction thereof, upon request and, in any event, after the
termination or expiration of this Agreement. All notes, data, reference
materials, sketches, disks, memoranda, tapes, manuals, files, documentation and
records in any way incorporating or reflecting any of the Trade Secrets or
Confidential Information of Tumbleweed or its Associates shall belong
exclusively to Tumbleweed or its Associates
UPS/Tumbleweed Confidential 38 December 18, 1997
and upon the termination or expiration of this Agreement, UPS agrees to turn
over all copies of such materials in UPS's possession or control to Tumbleweed,
or certify the destruction thereof.
c. THIRD PARTY MATERIALS. Neither party wishes to incorporate any
unlicenced or unauthorized materials into its products. Therefore, each party
agrees that it will not knowingly disclose to the other, or cause the other to
use any information or material which is confidential to any third party unless
the disclosing party has a written agreement with such third party permitting
disclosure of such information or material to the receiving party or the
receiving party otherwise has the right to receive and use such information or
material. Neither party will incorporate into its work any materials which are
subject to the copyrights of any third party except with the prior written
consent of said third party.
d. PUBLICITY. Tumbleweed shall not use the name of or refer to UPS
or any of its Affiliates directly or indirectly in any advertisement, press
release or professional or trade publication without receiving prior written
approval from UPS. Notwithstanding the foregoing, and subject to Tumbleweed's
compliance with the applicable restrictions and other obligations hereunder
(e.g., restrictions on the disclosure of UPS's Confidential Information), UPS
will agree to be a reference account for Tumbleweed and will allow Tumbleweed to
promote its relationship with UPS in press releases, web pages and other
collateral marketing and sales materials; provided, however, that Tumbleweed
must obtain UPS's prior written consent with respect to any and all such
descriptions of the relationship between UPS and Tumbleweed, which consent will
not be unreasonably withheld.
e. REMEDIES. Both parties acknowledge and agree that there may be
no adequate remedy at law available to the other party in the event of the
breach of any provision of this Section 10 and that such other party, in
addition to any other rights which may be available to it, shall have the right
to obtain specific performance or injunctive relief, as applicable, in the event
of any breach or threatened breach of these provisions.
11. SOURCE CODE.
a. RIGHT TO USE SOURCE CODE. UPS shall be entitled to a copy of the
Source Code for the Software, and may use same for its own benefit as set forth
in Section 11(c) hereto if (i) Tumbleweed suffers an "Insolvency Event," as such
term is defined in the Escrow Agreement attached hereto as Exhibit F, and in
connection therewith, Tumbleweed or its trustee or receiver rejects this
Agreement; or (ii) Tumbleweed is in material breach of the maintenance
provisions set forth in Section 9 hereof, or of any software maintenance
agreement then in effect between the parties relating to the Standard Software
and that has replaced the provisions of Section 9 hereof.
b. SOURCE CODE ESCROW. Within fifteen (15) days after UPS's
acceptance of the Software associated with Phase II of this Agreement, and
thereafter no later than the time of Tumbleweed's delivery to UPS of the
Software associated with Phases subsequent to Phase II of
UPS/Tumbleweed Confidential 39 December 18, 1997
this Agreement, Tumbleweed shall place the Source Code for such Software in
escrow pursuant to an escrow agreement in the form of the escrow agreement
attached hereto as Exhibit F (the "Escrow Agreement"), which Escrow Agreement
shall be entered into prior to the date of such delivery. Except as set forth
herein, Tumbleweed shall be responsible for all charges incurred in establishing
and maintaining such escrow account. UPS shall be entitled to receive a copy of
such Source Code under the circumstances set forth in Section 11(a) above and
pursuant to the procedures set forth in the Escrow Agreement. If Tumbleweed
corrects any defects in, or provides any revision to, the Software under
Section 9 hereof, or under any software maintenance agreement between the
parties, Tumbleweed shall simultaneously furnish the escrow agent with a
corrected or revised copy of the Source Code for the Software.
c. VERIFICATION OF ESCROW DEPOSIT(S). UPS may periodically, but not
more frequently than once per year, trigger fresh escrow deposits. UPS shall
reimburse Tumbleweed and the escrow agent under the Escrow Agreement for the
reasonable expenses incurred in the preparation of such fresh escrow deposits.
In addition to triggering fresh deposits, UPS shall have the right, either
itself or through a third party designated by UPS, to validate the materials on
deposit upon thirty (30) calendar days prior written notice to and in the
presence of Tumbleweed, but no more frequently than two (2) times per year. Any
third party designated by UPS to validate the materials on deposit shall be
required to execute a nondisclosure agreement with Tumbleweed, in a form
reasonably satisfactory to Tumbleweed, which nondisclosure agreement shall
require that such third party's report to UPS contain only a non-confidential
description of results of such validation. Verification shall take place at
Tumbleweed's convenience during normal business hours on mutually-designated
hardware. Such verification shall be at UPS's expense unless the materials on
deposit have not been deposited at the frequency required in Section 11(b)
above, in which event Tumbleweed shall bear all costs associated therewith.
d. OWNERSHIP OF MODIFICATIONS MADE BY UPS. Any and all Derivative
Works to the Source code released from escrow which are made by or on behalf of
UPS shall be the sole property of UPS. UPS acknowledges that its ownership of
such Derivative Works in no way, form or manner creates or transfers any right
or title in the Source code to the underlying Standard Software, and that its
ownership rights are limited solely to the Derivative Works.
e. SOURCE CODE LICENSE. Upon the occurrence of the release events
set forth in Section 11(a), Tumbleweed hereby automatically grants to UPS, a
non-exclusive, irrevocable license to Use, reproduce, modify, maintain, support,
update, make, have made, and create Derivative Works of the Source code, and to
create object code copies of such software thereby created solely to support and
enhance the Messaging Service. UPS shall have the right to employ third party
contractors to exercise the foregoing license, so long as such third parties are
bound by terms no less protective of the Source Code than the terms of this
Agreement, including an obligation to protect the confidential and proprietary
nature of the Source Code and to use the Source Code only on UPS's behalf and
only to the extent necessary to support the foregoing license. Except as
incident to the foregoing grant, UPS may not use, reproduce, distribute, create
Derivative Works of, publicly perform, publicly display, digitally perform,
UPS/Tumbleweed Confidential 40 December 18, 1997
make, have made, sell, offer to sell or import the Source Code. UPS shall
continue to pay Royalties, and UPS's failure to make such payments when due
shall terminate this source code license.
f. DISCONTINUANCE OF MARKETING. If Tumbleweed ceases to market the
Standard Software and such marketing is not continued by another Person, or is
continued by another Person which UPS for reasonable cause deems unsatisfactory,
at UPS's request, UPS and Tumbleweed will enter into good faith negotiations to
license the Source code to UPS on commercially reasonable terms.
12. TRAINING SERVICES. In addition to the training outlined in Exhibit G
hereto, the License Fees and development fees specified in Section 6 hereof
include all costs (other than Tumbleweed's reasonable and actual travel and
living expenses) for the following training programs: (i) attendance of up to
ten (10) of UPS's technical support personnel at Tumbleweed's two-day system
administrator training course, for which course UPS shall have the right to
select the topics to be covered based upon training materials supplied to UPS by
Tumbleweed in advance of such training; and (ii) training of up to fifteen (15)
of UPS's end user support personnel on the Use and operation of the Software.
Pursuant to a mutually agreed upon schedule, Tumbleweed shall provide sufficient
experienced and qualified personnel to conduct such training at the location(s)
designated by UPS. The parties may mutually agree that Tumbleweed shall perform
additional training for UPS. Such training may be purchased by UPS, in it sole
discretion, at Tumbleweed's standard list price and shall be conducted at a
mutually agreed upon time. In addition, if the paries agree that such training
shall be performed at any site other than Tumbleweed's Redwood City facility,
UPS shall pay all reasonable and actual travel and living expenses incurred by
Tumbleweed in performing the training.
13. COMPLIANCE WITH LAWS.
a. LICENSES AND PERMITS. Tumbleweed (i) is responsible for
obtaining all licenses, authorizations and permits required by applicable
legislative enactments and regulatory authorizations, whether United States
federal, state, local or otherwise, which are required in connection with the
export of the Software from the United States to foreign countries which may
reasonably be considered to be "major" markets, and/or in connection with the
exercise by UPS and its sublicensees (to the extent of their sublicenses),
within the United States, of their respective rights derived from this
Agreement; and (ii) has financial responsibility for, and shall pay, all fees
and taxes associated with such licenses, authorizations and permits. UPS is
responsible for obtaining, and shall pay all fees and taxes associated with, all
licenses, authorizations and permits required by applicable legislative
enactments and regulatory authorizations, whether United States federal, state,
local or otherwise, which are required in connection with the export of the
Software from the United States to any and all other foreign countries. With
respect to foreign jurisdictions within which UPS will provide the Messaging
Service, UPS shall also be responsible for obtaining all licenses,
authorizations and permits required by applicable legislative enactments and
regulatory authorizations, except with respect to those provided for
UPS/Tumbleweed Confidential 41 December 18, 1997
above in this Section 13(a). Notwithstanding the foregoing, upon UPS's
reasonable request and subject to UPS's agreement to reimburse any associated
costs and reasonable expenses, Tumbleweed will promptly execute all documents
and do all acts which may be necessary, desirable or convenient to enable UPS at
its expense to obtain such licenses, authorizations and permits. In the event
that Tumbleweed has expertise in procuring any such licenses, authorizations or
permits, Tumbleweed shall cooperate with UPS to share such information regarding
the same.
b. CHANGES IN LAW AND REGULATIONS. Tumbleweed shall use reasonable
efforts to identify the impact of changes in applicable legislative enactments
and regulations on the functions performed by the Software, whether such
enactments or regulations are foreign or Untied States federal, state, local or
otherwise. Tumbleweed shall notify UPS of such changes and shall work with UPS
to identify the impact of such changes on UPS's offering of the Messaging
Service. Tumbleweed shall promptly make any resulting modifications to the
Software as reasonable necessary as a result of such changes, and shall be
responsible for, and shall pay for, the cost of any such changes directly
related to Tumbleweed's business.
14. INDEMNIFICATION.
a. PROPRIETARY RIGHTS INDEMNIFICATION. Tumbleweed shall indemnify,
defend and hold UPS and its Affiliates and Server Sublicensees and their
respective officers, directors, agents and employees harmless from and against
any and all liabilities, damages, losses, expenses, claims, demands, suits,
fines or judgments, including reasonable attorneys' fees, and costs and expenses
incidental thereto, which may be suffered by, accrued against, charged to or
recoverable from UPS or any of its Affiliates or Server Sublicensees, or their
respective officers, directors, agents or employees, arising out of a claim that
the Software or Documentation, or any portion thereof, infringes or
misappropriates any United States or foreign patent, copyright, trade secret or
other proprietary right. In the event that the Software or Documentation, or
any portion thereof, is held in a suit or proceeding, or Tumbleweed, in its sole
discretion, believes that the software or Documentation may be held, to infringe
any rights of any other Person, and the Use of the Software or Documentation or
portion thereof is enjoined, or Tumbleweed, believes that the Software or
Documentation may be enjoined, Tumbleweed shall, at its sole option and expense,
either (i) procure for UPS the right to continue using the Software and
Documentation, or (ii) modify the Software and/or Documentation or replace the
same with non-infringing software or materials of equivalent functionality and
performance. Tumbleweed will not be liable for claims based upon: (w)
compliance with UPS specifications, where such specifications would necessarily
give rise to infringement (i.e. where alternate implementations of substantially
the same functionality would not avoid such infringement); (x) the use or
combination of the Software with software, hardware, or other materials not
provided or approved by Tumbleweed; (y) any use of a version of the Software
which has been altered or modified other than by Tumbleweed or an authorized
representative of Tumbleweed, if infringement would not have occurred but for
the alteration or modification; or (z) any UPS Intellectual Property
incorporated into the Custom Software.
UPS/Tumbleweed Confidential 42 December 18, 1997
b. TUMBLEWEED'S GENERAL INDEMNITY. Tumbleweed shall indemnify,
defend and hold UPS and its Affiliates, and their respective officers,
directors, agents and employees, harmless from and against any and all
liabilities, damages, losses, expenses, claims, demands, suits, fines or
judgments, including reasonable attorneys' fees, and costs and expenses
incidental thereto, which may be suffered by, accrued against, charged to or
recoverable from UPS or any of its Affiliates, or any of their respective
officers, directors, agents or employees, arising out of or resulting from (i)
claims of bodily injury, including death, or loss or damage to property or
physical destruction of property arising out of or in connection with any act,
error or omission of Tumbleweed or any of its officers, directors, agents,
employees or subcontractors, during the term of this Agreement; (ii) the fault
or negligence of Tumbleweed in the course of its performance under this
Agreement, including, without limitation, performance, nonperformance, or defect
in performance or defect in design, or any failure of any license management
software (to the extent placed in the software by Tumbleweed) to operate
properly, or any statement, misstatement, representation or misrepresentation
made by Tumbleweed; or (iii) a reclassification or attempt to reclassify any of
Tumbleweed's employees as an employee of UPS, including, without limitation, any
tax liability (including interest and penalties) resulting from UPS's failure to
pay, deduct or withhold income taxes, Federal Insurance Contribution Act taxes,
or Federal Unemployment Tax Act taxes with respect to any of Tumbleweed's
employees.
c. UPS'S GENERAL INDEMNITY. Except with respect to matters covered
by Sections 14(a) and (b) above, UPS shall indemnify, defend and hold Tumbleweed
and its officers, directors, agents and employees harmless from and against any
and all liabilities, damages, losses, expenses, claims, demands, suits, fines or
judgments, including reasonable attorneys' fees, and costs and expenses
incidental thereto, which may be suffered by, accrued against, charged to or
recoverable from Tumbleweed or any of its officers, directors, agents or
employees, arising out of or resulting from claims by third parties, including
end user customers of UPS, based upon (i) any representations made by UPS to
such third parties which are not supported by the Documentation and/or any other
information or materials supplied by Tumbleweed, or (ii) any acts committed by
UPS's end user customers during the course of their use of the Messaging
Service. IN NO EVENT WILL UPS'S AGGREGATE, CUMULATIVE LIABILITY UNDER THIS
SECTION 14 EXCEED [ * ]
d. LITIGATION. The parties' respective indemnification obligations
hereunder shall require that promptly after a party seeking to be indemnified
receives a threat of any action, or a notice of the commencement or filing of
any action which may be subject to the provisions of this Section 14, the party
seeking indemnification shall notify the other party in writing and tender the
matter to said party for resolution or litigation. The indemnifying party shall
keep the
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 43 December 18, 1997
other party reasonably apprized of the continuing status of the claims covered
by this Section 14, including any lawsuits resulting therefrom, and shall permit
the other party, upon such party's written request, to participate (at such
party's own expense) in the defense or settlement of any such claim. Neither
party shall be required to indemnify for, be bound by, or otherwise incur any
liability with respect to, any settlement terms to which it has not agreed; and
in such a case, the party has not agreed to the settlement terms shall assume
the cost of defending against any such claim and shall select the attorney(s) to
defend against such claim subject to the other party's approval, which shall not
be unreasonably withheld.
15. CO-PROMOTION AND CO-ADVERTISING. Any and all marketing by Tumbleweed
shall exclude co-promoting or co-advertising with, or otherwise licensing the
use of any of the Tumbleweed Marks, to:
(A) [ * ]
(B) any of the following entities for the period ending [ * ],
or (xi) any parent or subsidiary of any entity on the above list which
is involved in the transportation industry or any successor of any
entity on the above list.
To the extent that any of the foregoing entities utilize any such Tumbleweed
Marks in violation of the foregoing restriction, Tumbleweed will take any and
all reasonable steps necessary to enjoin such entity(ies) from using said
Tumbleweed Marks. The [ * ] date provided for above in this
Section 15 shall be extended on a day for day basis for any slippage in any of
the dates set forth in the Implementation Schedule which is caused by
Tumbleweed.
16. TERM AND TERMINATION.
a. TERM. The term of this Agreement shall be [ * ], subject
to any earlier termination hereof pursuant to the express terms and conditions
of this Agreement.
b. TERMINATION BY TUMBLEWEED; ESCALATION. Tumbleweed may terminate
this Agreement for UPS's breach of its payment obligations under Sections 6(a),
(b), (c), (d), (g), and may terminate Section 9 of this Agreement for UPS's
breach of its payment obligations under Section 6(i) and (j), provided that
prior to any such termination (i) the parties shall first engage in good faith
in the dispute escalation procedures set forth below, and (ii) if the dispute
can be resolved via an accounting audit process, such audit process (as set
forth in Sections 6(e) and (o)) shall have been completed. In the event that a
dispute arises regarding any payment or withholding of any funds, either party
may give the other notice of the existence of a dispute. If the dispute is not
resolved in the normal course of business, then each party shall refer the
dispute to the following individuals, which individuals shall attempt to settle
amicably by good faith discussions such dispute:
For UPS: Xxxx X. Xxxxxx
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 44 December 18, 1997
For Tumbleweed: Xxxxxxx X. Xxxxx
If the designated individuals are unable to resolve the dispute by such
discussions within thirty (30) days (the "Escalation Period"), and the parties
have not agreed that the dispute can be resolved via an accounting audit process
(or if the parties have agreed that the dispute can be resolved via an
accounting audit process, such process has been completed, including the thirty
(30) day payment period provided for in Section 6(o)), and if UPS has not paid
the disputed amounts within an additional thirty (30) days following the
Escalation Period, then Tumbleweed may terminate this Agreement without
liability for such termination. No payment by UPS of any disputed amount under
this Agreement, whether pursuant to Section 6(o), this Section 16(b) or
otherwise, shall constitute a waiver by UPS of its right to pursue any and all
claims relating thereto following such payment, provided, however, that UPS
shall have provided Tumbleweed written notice of its continued dispute.
c. CONSEQUENCES OF TERMINATION. In the event of the termination or
expiration of this Agreement, in addition to the parties' other obligations
hereunder, (i) all licenses granted by either party to the other hereunder shall
terminate, (ii) UPS shall promptly remove all copies of the
Tumbleweed-proprietary Software from all servers in UPS's control, (iii) both
parties shall promptly remove all references to the other party and its products
and/or services from its advertising and other promotional materials, and from
its website and any other Internet sites, and (iv) except as otherwise provided
to the contrary, all obligations of one party to the other party shall cease.
Sections 1, 2(j) (only to the extent any amounts remain due and payable), 2(k),
4(b) (only to the extent any amounts remain due and payable and/or restrictive
covenants remain unfulfilled), 5(d), 6 (only to the extent any fees remain due
and payable), 10, 13 (only to the extent of any financial obligations
thereunder), 14, 15 (except as otherwise expressly provided herein), 16, 17
(except for subsections (a) and (h)) shall survive the termination or expiration
of this Agreement.
17. MISCELLANEOUS.
a. INSURANCE. Tumbleweed shall, at its own cost and expense,
obtain and maintain in full force and effect, with sound and reputable
insurers, during the term of this Agreement, the following insurance
coverages: (i) Workers' Compensation insurance as required by the law of the
state of hire. Tumbleweed shall cause the carrier to provide a waiver of
subrogation in favor of UPS for this coverage; (ii) Employer's liability
insurance with a minimum limit of [ * ] of liability, and not less than
[ * ] aggregate limit of liability per policy year for disease,
including death at any time resulting therefrom, not caused by accident;
(iii) Comprehensive General Liability insurance, including blanket
contractual liability, broad form property damage, and products and completed
operations coverage, on an occurrence form insuring against all hazards with
a minimum limit of liability for bodily injury, including death resulting
therefrom, and property damage in the amount of [ * ] per occurrence.
The coverage should also include coverage for personal and advertising injury
liability, United Parcel Service of America, Inc. and each of its
subsidiaries shall be named as "additional insureds"
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 45 December 18, 1997
under this policy with respect to the Services provided for under this
Agreement; (iv) Automobile liability insurance against liability arising from
the maintenance or use of all owned, non-owned and hired automobiles and trucks
with a minimum limit of liability for bodily injury and/or property damage of
[ * ] Combined Single limit. United Parcel Service of America, Inc. and
each of its subsidiaries shall be named as "additional insureds" under this
policy with respect to the Services provided for under this Agreement; and (v)
insurance in the minimum amount of [ * ] for coverage of software errors
and omissions, including services rendered and intellectual property
infringement claims, with respect to the computer software developed hereunder.
Tumbleweed's insurance shall be deemed primary and without right of contribution
by UPS. Tumbleweed shall provide UPS with certificates of insurance evidencing
the coverages required hereunder within fifteen (15) days after execution of
this Agreement. Each policy required hereunder shall provide that UPS shall
receive thirty (30) days' advance written notice in the event of a cancellation
or material change in such policy. In the event that any of the Services under
this Agreement are to be rendered by persons other than Tumbleweed's employees,
Tumbleweed shall arrange to furnish UPS with evidence of insurance for such
persons subject to the same terms and conditions as set forth above and
applicable to UPS prior to commencement of service by such person(s).
b. ENTIRE AGREEMENT. This Agreement, including the Exhibits
attached hereto and the Specifications which are agreed to by the parties as
provided in this Agreement, contains the entire understanding and agreement of
the parties with respect to the subject matter hereof, and supersedes any prior
written or oral agreements between them with respect thereto. Except as set
forth herein, there are no representations, agreements, arrangements or
understandings, written or oral, between the parties with respect to the subject
matter of this Agreement. This Agreement shall control over any conflicting
provisions of any UPS purchase order, Tumbleweed invoice or other business form,
and such conflicting provisions are expressly rejected. In the event of any
conflict between this Agreement and an Exhibit, the terms of this Agreement
shall control.
c. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York, as such laws are applied
to agreements entered into and to be performed entirely within the State of New
York between residents of the State of New York. The parties agree that the
exclusive jurisdiction and venue for any action relating to this Agreement shall
be a federal or state court in the State of New York, and the parties hereby
consent to such jurisdiction and venue.
d. RELATIONSHIP OF THE PARTIES. Tumbleweed acknowledges, agrees,
represents and warrants that it is and has been engaged as an independent
contractor, and not as an employee, of UPS, and nothing in this Agreement shall
be construed as creating an employer-employee relationship or any partnership or
joint venture between UPS and Tumbleweed. Tumbleweed shall be responsible for
payment of all federal, state and local business-related and employment-related
taxes, withholding and insurance arising out of Tumbleweed's and its
subcontractors' activities, including by way of illustration, but not limited
to, federal and state
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 46 December 18, 1997
income taxes, social security taxes, unemployment insurance taxes, where
applicable, and business license fees, where required. Neither party shall
incur any liability on behalf of the other party nor in any way represent or
bind such other party in any manner or thing whatsoever, and nothing herein
shall be deemed to make either party the agent or legal representative of the
other.
e. AMENDMENTS AND MODIFICATIONS. No amendment to or modification of
this Agreement shall be binding upon either party unless such amendment or
modification is reduced to writing, dated and executed by the parties to this
Agreement.
f. PERSONAL PRONOUNS; HEADINGS. All personal pronouns in this
Agreement, whether used in the masculine, feminine or neuter gender shall
include all other genders; the singular shall include the plural and vice versa.
Titles of all sections and paragraphs in this Agreement are for convenience only
and shall neither limit nor amplify the substantive provisions of this
Agreement.
g. SEVERABILITY. In the event that any one or more of the
provisions of this Agreement is determined by a court of competent jurisdiction
to be invalid, unenforceable or illegal, such invalidity, unenforceability or
illegality shall not affect any other provisions of this Agreement and this
Agreement shall be construed as if the challenged provision had never been
contained herein. The parties further agree that in the event such provision is
an essential part of this Agreement, they will immediately begin negotiations
for a suitable replacement provision.
h. NO ASSIGNMENT. Neither party may assign its rights or delegate
its duties under this Agreement without the other party's prior written consent.
Any attempted assignment in violation of the foregoing shall be void and of no
effect. Notwithstanding the foregoing, without the consent of the other party,
(i) either party may assign its rights and delegate its duties, in whole but not
in part, to any successor in interest by asset sale, merger, reorganization,
recapitalization or similar transaction, except that UPS's prior written consent
shall be required with respect to any delegation or assignment by Tumbleweed to
any of the entities listed in Section 15 above, during the period specified
therein, and (ii) UPS may assign its rights and delegate its duties to any of
its Affiliates. Following any such assignment or delegation by Tumbleweed
pursuant to the previous sentence, upon written notice to Tumbleweed (or its
successor in interest), UPS shall have the right to (i) cancel any outstanding
development Services with respect to any Phase(s) subsequent to Phase II of the
Project, (ii) terminate the procurement of Maintenance Services from Tumbleweed
pursuant to Section 9 hereof, such termination to be effective one (1) year
after the giving of such notice, (iii) convert the licenses granted by
Tumbleweed hereunder to irrevocable licenses for the remainder of the
[ * ]
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 47 December 18, 1997
term of this Agreement, and (iv) reduce the Royalties payable pursuant to
Section 6(b) hereof, for the remainder of the term of this Agreement, to
[ * ] actually received by UPS and/or its Affiliates for license
fees for the Software [ * ]. The parties' rights and obligations
will bind and inure to the benefit of their respective successors and permitted
assigns.
i. NO WAIVER. The failure of either party at any time to require
performance by the other party of any provision of this Agreement shall in no
way affect that party's right to enforce such provisions, nor shall the waiver
by either party of any breach of any provision of this Agreement be taken or
held to be a waiver of any further breach of the same provision.
j. NOTICES. Except as otherwise provided herein, and except for
notices of failures, errors or other problems with the Software, which may be
delivered by phone and confirmed in writing, all notices, requests, demands or
other communications required or permitted to be given or made under this
Agreement shall be in writing and shall be given by personal service, UPS Next
Day Air, telecopy, or by United States certified mail, return receipt requested,
postage prepaid to the addresses set forth below, or such other address as
changed through written notice to the other party.
If to UPS:
United Parcel Service
00 Xxxxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
With a copy to Xxx Xxxx (same address); Telecopy: (000) 000-0000
If to Tumbleweed:
Tumbleweed Software Corp.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxx, Xxxxxxxxxx 00000
Attn: President
Telecopy: (000) 000-0000
---------------
[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 48 December 18, 1997
Notice given by personal service shall be deemed effective on the date
it is delivered, notice sent by UPS Next Day Air shall be deemed effective one
Business Day after dispatch, notice given by telecopy shall be deemed effective
on the date of transmission, and notice mailed shall be deemed effective on the
third Business Day following its placement in the mail.
k. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which, when so executed and delivered, shall be deemed an
original, and all of which shall constitute one and the same Agreement.
l. CONSTRUCTION. This Agreement shall be construed and interpreted
fairly, in accordance with the plain meaning of its terms, and there shall be no
presumption or inference against the party drafting this Agreement in construing
or interpreting the provisions hereof.
m. PERSONNEL RULES AND REGULATIONS. While on the other party's
premises, the personnel of each party will comply with all security practices
and procedures generally prescribed by such other party. In addition, unless
otherwise instructed by UPS, Tumbleweed personnel shall observe the working
hours, working rules, holiday schedules and policies of UPS while working on
UPS's premises.
n. EXHIBITS. The following Exhibits are attached hereto and
incorporated herein by reference:
Exhibit "A" - Standard Software and Phase I Software and Services
Exhibit "B" - Phase II Software and Services
Exhibit "C" - Interface Information and Developer Kits
Exhibit "D" - Implementation Schedule
Exhibit "E" - End User License Terms
Exhibit "F" - Source Code Escrow Agreement
Exhibit "G" - Marketing Support Services
Exhibit "H" - [Reserved]
Exhibit "I" - Server Software Sublicense Terms
o. LIMITATION OF LIABILITY. EXCEPT WITH RESPECT TO TUMBLEWEED'S
OBLIGATIONS UNDER SECTIONS 5, 14(a) (ONLY WITH RESPECT TO THE FIRST SENTENCE
THEREOF), 15 AND 17(p) HEREOF, AND EXCEPT WITH RESPECT TO UPS'S OBLIGATIONS
UNDER SECTIONS 5, 14(c) AND 17(p) HEREOF AND ITS OUTSTANDING PAYMENT OBLIGATIONS
UNDER SECTION 6 HEREOF, AND EXCEPT IN THE EVENT A PARTY BREACHES ITS
CONFIDENTIALITY OBLIGATIONS TO THE OTHER PARTY HEREUNDER, IN NO EVENT SHALL
EITHER PARTY'S AGGREGATE CUMULATIVE LIABILITY UNDER THIS AGREEMENT EXCEED (I)
DURING THE [
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 49 December 18, 1997
* ] OF THIS AGREEMENT, [ * ]; OR (II) DURING [ * ]
OF THIS AGREEMENT, [ * ] PLUS THE AMOUNTS ACTUALLY RECEIVED BY
TUMBLEWEED UNDER THIS AGREEMENT IN [ * ] PERIOD PRECEDING THE DATE
THE CLAIM IS MADE.
p. NO CONSEQUENTIAL DAMAGES. EXCEPT WITH RESPECT TO EACH PARTY'S
OUTSTANDING PAYMENT OBLIGATIONS HEREUNDER, IN NO EVENT SHALL EITHER PARTY BE
LIABLE IN THE AGGREGATE IN EXCESS OF [ * ] FOR LOST PROFITS OR LOSS
OF BUSINESS, OR FOR PUNITIVE, EXEMPLARY, SPECIAL, INCIDENTAL OR CONSEQUENTIAL
DAMAGES ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT (WHETHER FROM BREACH
OF CONTRACT OR WARRANTY OR FROM NEGLIGENCE OR STRICT LIABILITY OR OTHERWISE),
EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS
LIMITATION OF LIABILITY SHALL APPLY NOTWITHSTANDING THE FAILURE OF ESSENTIAL
PURPOSE OF ANY LIMITED REMEDY HEREIN.
---------------
[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential 50 December 18, 1997
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized representatives as of the date first above
written.
UPS:
UNITED PARCEL SERVICE GENERAL SERVICES CO.
By: /s/ Xxxxxx X. Xxxx
----------------------------
Title: Sr. V.P.
-------------------------
Print Name: Xxxxxx X. Xxxx
--------------------
Tumbleweed:
TUMBLEWEED SOFTWARE CORPORATION
By: Xxxxxx X. Consul
----------------------------
Title: V.P. Finance, C.F.O.
-------------------------
Print Name: Xxxxxx X. Consul
--------------------
UPS/Tumbleweed Confidential 51 December 18, 1997
EXHIBIT A
STANDARD SOFTWARE AND PHASE I SOFTWARE AND SERVICES
[ * ]
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[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential December 18, 1997
EXHIBIT B
PHASE II SOFTWARE AND SERVICES
[ * ]
---------------
[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential December 18, 1997
EXHIBIT C
INTERFACE INFORMATION AND DEVELOPER KITS
[ * ]
---------------
[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential December 18, 1997
EXHIBIT D
IMPLEMENTATION SCHEDULE
[ * ]
---------------
[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential December 18, 1997
EXHIBIT E
END USER LICENSE TERMS
United Parcel Service General Services Co. ("UPS") grants to the end-user
("Customer"), under the terms and conditions set forth herein and for so long as
Customer has a valid Messaging Service account and is not in breach of this
Agreement, a personal, non-exclusive and non-transferable right to use (i) all
computer programs, in any form, provided to the Customer in connection with the
Messaging Service (in object code form only), and all updates, enhancements and
modifications thereto which are provided to the Customer; and (ii) all user
documentation including manuals, handbooks and other written materials relating
to such programs which are provided to the Customer (together referred to as the
"Software"). Customer shall not use the Software for any purpose other than in
connection with Messaging Service transactions.
1. All title and ownership rights in the Software remain with UPS
and its licensors. Additional copies of the Software must contain the
copyright and proprietary notices which are furnished with the original.
Customer may not attempt to disable or bypass any functionality or
time-limitation mechanisms of the Messaging Service or Software, nor
decompile, disassemble, reverse engineer, reverse compile or otherwise
reduce the Software to human readable form without prior written consent of
UPS; PROVIDED, HOWEVER, that, notwithstanding anything contained herein to
the contrary, UPS's authorization shall not be required where reproduction
of the Software and translation of its form are indispensable in the
European Union to obtain the information necessary to achieve the
interoperability of the Software with other programs, provided that: (A)
these acts are performed by the Customer or by another person having a
right to use a copy of the Software, or on their behalf by a person
authorized to do so; (B) the information necessary to achieve
interoperability has not previously been readily available to the persons
referred to in subparagraph (A); and (C) these acts are confined to the
parts of the Software which are necessary to achieve interoperability.
2. UPS warrants that the Software provided by it will perform
substantially in accordance with applicable written product specifications
provided by UPS to Customer at the time of delivery for a period of
[ * ] from the date of delivery. UPS does not warrant that
Customer's use of the Software will be uninterrupted or error-free.
Customer's sole remedy shall be replacement of the Software. UPS MAKES NO
OTHER WARRANTIES OR REPRESENTATIONS, EXPRESS OR IMPLIED, IN FACT OR IN LAW,
---------------
[*]Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential December 18, 1997
INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, NON-INFRINGEMENT OR TITLE.
3. IN NO EVENT WILL UPS OR ANY OF ITS LICENSORS BE LIABLE FOR
INCIDENTAL, SPECIAL, CONSEQUENTIAL OR EXEMPLARY PENALTIES OR DAMAGES
(INCLUDING LOST PROFITS, OR PENALTIES AND/OR DAMAGES FOR DELAY IN DELIVERY
OR FAILURE TO GIVE NOTICE OR DELAY), EVEN IF UPS HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES. CUSTOMER AGREES THAT ANY LIABILITY OF UPS
HEREUNDER FOR DAMAGES, REGARDLESS OF THE FORM OF ACTION, SHALL NOT EXCEED
US$10.00.
4. UPS may terminate this License Agreement after giving written
notice to Customer of its failure to satisfy any of its obligations
hereunder if Customer then fails to begin taking corrective action within
fifteen (15) days after receiving such notice and to resolve such failure
within thirty (30) days after receiving such notice. Upon such
termination, Customer shall cease all use of all copies of the Software
which it received hereunder. In addition, UPS can terminate Customer's
right to use the Software in the event Customer ceases to do business or
becomes bankrupt. If UPS terminates this Agreement, Customer agrees to
return to UPS all copies of the Software, including all copies or partial
copies.
5. Any change to this License Agreement must be in writing, signed
by both parties. Interpretation of this License Agreement will be governed
by the laws of the State of Georgia, excluding (i) its conflicts of law
principals; (ii) the United Nations Convention on Contracts for the
International Sale of Goods; (iii) the 1974 Convention on the Limitation
Period in the International Sale of Goods; and (iv) the Protocol amending
the 1974 Convention, done at Vienna April 11, 1980.
6. No rights or licenses with respect to the Software, the names,
trademarks, service marks or logos of UPS or any of its licensors, or any
other of the intellectual property rights of UPS or any of its licensors,
or with respect to rights to offer services provided by the Software to
third parties, are granted or deemed granted hereunder or in connection
herewith, other than those rights to use the Software which are expressly
granted in this Agreement.
7. The Software is a "commercial item," as that term is defined at
48 C.F.R. 2.101 (Oct. 1995), consisting of "commercial computer software"
or "commercial computer software documentation" as such terms are used in
48 C.F.R. 12.212 (Sept. 1995). If the Customer is a unit or agency of the
United States Government, then the United States Government's rights with
respect to the Software are limited by the terms of this Agreement,
consistent with 48 C.F.R. 12.212 and 48 C.F.R. 227.7202-1 through
227.7202-4 (June 1995), as applicable.
UPS/Tumbleweed Confidential December 18, 1997
8. This Agreement is the complete and exclusive statement of the
agreement between UPS and Customer, and this Agreement supersedes any prior
proposal, agreement, or communication, oral or written, pertaining to the
subject matter of this Agreement.
9. Customer shall comply with all applicable United States export
control laws and regulations, and will obtain any export and/or re-export
authorizations required under the Export Administration Regulations of the
U.S. Department of Commerce and other relevant regulations controlling the
export of the Software or related technical data.
UPS/Tumbleweed Confidential December 18, 1997
Exhibit F
UPS/Tumbleweed Confidential December 18, 1997
EXHIBIT F
SOURCE CODE ESCROW AGREEMENT
This Agreement is made and entered into as the ___ day of _______, 199__,
by and between Tumbleweed Software Corporation, a California corporation with
offices at 0000 Xxxxxxxx Xxxxxx, Xxxxxxx Xxxx, Xxxxxxxxxx 00000 (hereinafter
"Tumbleweed"); United Parcel Service General Services Co., a Delaware
corporation with offices at 00 Xxxxxxxx Xxxxxxx, Xxxxxxx, Xxxxxxx 00000
(hereinafter "UPS"); and Data Securities International, a Delaware corporation
with offices at 0000 Xxxxxxxxxx Xxxxx, Xxx Xxxxx, Xxxxxxxxxx 00000 (hereinafter
"Escrow Agent").
WITNESSETH:
WHEREAS, Tumbleweed and UPS have entered into a Software License,
Development and Maintenance Agreement more particularly described below pursuant
to which Tumbleweed has agreed to license to UPS, its Affiliates, and certain
other third parties certain proprietary computer programs in object code form;
and
WHEREAS, Tumbleweed and UPS have agreed to place the source code
corresponding to such computer programs in escrow to be released to UPS upon
breach of certain obligations of maintenance and support of such programs
undertaken by Tumbleweed, or upon the occurrence of certain other events
described herein;
NOW THEREFORE, in consideration of the premises, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby covenant and agree as follows:
Section 1
DEFINITIONS
For the purposes of this Agreement, in addition to definitions set forth
elsewhere in this Agreement, the definitions set forth in this Section shall
apply to the respective capitalized terms immediately preceding each definition.
Other capitalized terms shall have the meanings set forth in the License
Agreement.
1.1 "AGREEMENT." This Source Code Escrow Agreement, including
any exhibits, addenda, amendments and modifications hereto.
1.2 "INSOLVENCY EVENT." Any one or more of the following: (1)
Tumbleweed's admission in writing of its inability to pay its debts
generally as they become due, or (2) a general assignment for the
benefit of creditors by Tumbleweed; or (3) voluntary institution of
proceedings by Tumbleweed to be adjudicated as bankruptcy; or (4)
Tumbleweed's consent to the filing of a petition of bankruptcy against
it; or (5) adjudication of Tumbleweed
UPS/Tumbleweed Confidential December 18, 1997
by a court of competent jurisdiction as being bankrupt or insolvent;
or (6) Tumbleweed's application for reorganization under any bankrupt
act or law, or Tumbleweed's consent to the filing of a petition
seeking such a reorganization; or (7) the entry of a decree against
Tumbleweed by a court of competent jurisdiction appointing a receiver,
liquidator, trustee, or assignee in bankruptcy or in insolvency
covering all or substantially all of Tumbleweed's property or
providing for the liquidation of Tumbleweed's property or business.
1.3 "LICENSE AGREEMENT." The Software License, Development and
Services Agreement entered into by the parties as of the 19th day of
December, 1997, pursuant to which Tumbleweed has agreed, INTER ALIA,
to license the Software to UPS.
1.4 "SUPPORT SERVICES." All warranty, maintenance (customer
support), error correction, installation, and other technical
assistance respecting the Software required to be performed by
Tumbleweed pursuant either to Section 9 of the License Agreement or
to any software maintenance agreement(s) then in effect between the
parties and that has replaced the provisions of Section 9 of the
License Agreement.
Section 2
PURPOSE OF AGREEMENT; DEPOSIT OF SOURCE CODE
2.1 DEPOSIT OF SOURCE CODE. The deposit of Source Code and the
expanded license thereof to UPS pursuant to Section 11(e) of the
License Agreement are intended to provide assurance to UPS of access
to, and the right to use, the Source Code in the event, INTER ALIA,
that Tumbleweed fails to provide Support Services as required under
the License Agreement or any software maintenance (customer support)
agreement respecting the Software. In connection therewith, Escrow
Agent agrees to accept from Tumbleweed and Tumbleweed agrees to
deposit with Escrow Agent, within the time frames set forth in
Section 11(b) of the License Agreement, a copy of the Source Code.
Tumbleweed will furnish to Escrow Agent a list describing all Source
Code so deposited. Such description will be supplemented and updated
by Tumbleweed with each subsequent deposit of Source Code. For
each deposit, Escrow Agent will issue receipts to Tumbleweed.
2.2 UPDATE AND MAINTENANCE OF SOURCE CODE. During the term of
this Agreement, Tumbleweed shall keep the Source Code in escrow fully
current by depositing a copy of the Source Code corresponding to each
and every Enhancement to the Software licensed to UPS from time to
time, such deposits to be completed within the time frames set forth
in Section 11(b) of the License Agreement.
2.3 VERIFICATION AND TESTING OF SOURCE CODE. UPS shall have the
right to inspect, compile, test and review the Source Code at the time
of the initial deposit and at the time of each subsequent deposit of
the Source Code in escrow, and from time to time thereafter, to verify
that it corresponds to the Software, provided Tumbleweed is given
written notice to such verification and testing of the Source Code and
provided Tumbleweed is given the right
UPS/Tumbleweed Confidential December 18, 1997
to supervise the verification, testing and security of the Source
Code. Escrow Agent shall permit such inspections and testing of the
same promptly upon request. Such inspections and testing shall be at
UPS's expense and shall be conducted at Tumbleweed's premises or at
such other location as Tumbleweed may approve, which approval shall
not be unreasonably withheld.
Section 3
TITLE TO SOURCE CODE
Title to the Source Code shall remain in Tumbleweed, but title to the media
upon which the Source Code is stored to be deposited in escrow hereunder shall
pass to, and vest in, Escrow Agent immediately upon delivery, and in the event
the Source Code shall be delivered to UPS pursuant hereto, title to the media
upon which the Source Code is stored shall thereupon pass to and vest in UPS.
Notwithstanding it ownership of a copy of the Source Code in such event, UPS
shall remain subject to the terms of the license granted pursuant to Section
11(e) of the License Agreement with respect to the Use thereof.
Section 4
RELEASE OF SOURCE CODE TO UPS
4.1 NOTICE OF DEFAULT; RIGHT TO CURE. If UPS shall conclude in good faith
that a release event set forth in Section 11(a) of the License Agreement has
occurred (including Tumbleweed's failure in any material respect to provide any
Support Services that it is obligated to provide, and such failure has resulted
in UPS's inability to use any of the major functional components of the
Software), it shall so notify Tumbleweed in writing (the "Initial Notice").
Such notice shall describe such failure in reasonable detail. A copy of such
Initial Notice shall be simultaneously delivered to Escrow Agent. For a period
of twenty (20) days after receipt of such Initial Notice, Tumbleweed shall have
the right to cure the identified failure. In the event that, at the conclusion
of such cure period, UPS shall conclude in good faith that the identified
failures have not been cured, UPS may so notify both Tumbleweed and Escrow Agent
in writing and demand that Escrow Agent release the Source Code to UPS (the
"Final Notice"). Notwithstanding the foregoing, in the event that the release
event is an Insolvency Event, and in connection therewith, Tumbleweed or its
trustee or receiver rejects the License Agreement, UPS shall not be obligated to
provide the Initial Notice, and the initial notification by UPS shall be deemed
to constitute a Final Notice.
4.2 DISPUTE BY TUMBLEWEED. If Tumbleweed disputes UPS's determination
that the identified failure occurred and has not been cured following the
expiration of the allowed period. Tumbleweed may so notify Escrow Agent and UPS
in writing within four (4) business days after receipt of UPS's Final Notice
demanding release of the Source Code. Failure of Tumbleweed to give timely
notice of such an objection shall conclusively establish its consent to the
release of the Source Code to UPS hereunder, whereupon Escrow Agent shall
promptly release a copy of the Source Code to UPS. In the event of a dispute,
Escrow Agent will continue to store the Source Code without
UPS/Tumbleweed Confidential December 18, 1997
release, pending (a) joint instructions from UPS and Tumbleweed, (b) resolution
pursuant to Section 5, or (c) order of a court.
4.3 INJUNCTIVE RELIEF. Tumbleweed and UPS acknowledge and agree that UPS
may suffer irreparable harm to its business and operations in the event that
release of the Source Code to UPS pursuant to the terms hereof is wrongfully
delayed by Tumbleweed, and that UPS may petition for injunctive relief to
prevent Tumbleweed from seeking to delay such release.
Section 5
ARBITRATION OF DISPUTES RESPECTING RELEASE OF SOURCE CODE
5.1 ARBITRATION OF DISPUTES. In the event of any dispute respecting
release of the Source Code under Section 4 hereof, representatives of Tumbleweed
and UPS shall meet no later than five (5) days after delivery of Tumbleweed's
notice objecting to such release and shall enter into good faith negotiations
aimed at curing the deficiencies alleged to exist. If such persons are unable
to resolve the dispute in a satisfactory manner within the next five (5) days,
either Tumbleweed or UPS may seek binding arbitration in accordance with the
terms of this Section 5.
5.2 ARBITRATION PROCEDURE. Upon receipt by Escrow Agent of written notice
by Tumbleweed or UPS calling for arbitration with respect to any dispute
respecting release of the Source Code under Section 4 hereof, the matter shall
be submitted to binding arbitration. Such arbitration shall be conducted under
the commercial rules then prevailing of the American Arbitration Association, by
a single arbitrator appointed by the American Arbitration Association. Insofar
as possible, such arbitrator shall be, at the time of his selection, a partner
or manager of a national or regional accounting firm (including the information
processing affiliates thereof) not regularly employed by Tumbleweed or UPS, and
such arbitrator shall be required to have substantial experience in the field of
computer software technology and licensing. The sole issue for arbitration
shall be whether Tumbleweed has failed in any material respect to provide any
Support Services that it is obligated to provide, in accordance with the terms
of the applicable agreement. If the arbitrator shall so determine, he shall
forthwith so notify the parties, and Escrow Agent shall forthwith deliver the
Source Code to UPS. The decision of the arbitrator shall be final and binding
on Tumbleweed and UPS and may be entered and enforced in any court in competent
jurisdiction of either party.
5.3 COSTS OF ARBITRATION. The prevailing party in the arbitration
proceedings shall be awarded reasonable attorney fees, expert witness costs and
expenses, and all other costs and expenses incurred directly or indirectly in
connection with the proceedings, unless the arbitrator for good cause determines
otherwise.
UPS/Tumbleweed Confidential December 18, 1997
Section 6
LICENSE OF SOURCE CODE
6.1 LICENSE. In the event that the Source Code shall be delivered out of
escrow to UPS pursuant to the terms of this Agreement, UPS shall be licensed by
Tumbleweed, and Tumbleweed does so hereby license UPS subject to such condition,
to use the Source Code pursuant to the expanded license terms set forth in
Section 11(e) of the License Agreement.
6.2 CONFIDENTIALITY UNDERTAKING. UPS shall treat and preserve the Source
Code as a Trade Secret of Tumbleweed in accordance with the terms of Section 10
of the License Agreement, and in no event shall UPS's treatment be less secure
than that of UPS's own propriety source code of similar importance.
Section 7
FEES OF ESCROW AGENT
7.1 Tumbleweed shall pay to Escrow Agent, annually in advance during the
term hereof, the fees of Escrow Agent at the rate prescribed on the attached
Exhibit B for its performance of services hereunder.
Section 8
LIMITATION ON OBLIGATIONS OF ESCROW AGENT
8.1 LIMITED DUTY OF INQUIRY. Escrow Agent shall not be required to
inquire into the truth of any statements or representations contained in any
notices, certificates, or other documents required or otherwise provided
hereunder, and it shall be entitled to assume that the signatures on such
documents are genuine, that the persons signing on behalf of any party thereto
are duly authorized to execute the same, and that all actions necessary to
render any such documents binding on the party purporting to be executing the
same have been duly undertaken. Without limiting the foregoing, Escrow Agent
may, in its discretion, require from Tumbleweed or UPS additional documents that
it deems to be necessary or desirable to aid in the course of performing its
obligations hereunder.
8.2 RIGHT TO INTERPLEADER. Notwithstanding any other provision of this
Agreement, in the event Escrow Agent shall receive conflicting demands from
Tumbleweed and UPS respecting release of the Source Code to UPS hereunder,
Escrow Agent may, in its sole discretion, file an interpleader action with
respect thereto in any court of competent jurisdiction.
8.3 RELEASE AND INDEMNIFICATION OF ESCROW AGENT. Tumbleweed and UPS,
severally, do hereby release Escrow Agent from any and all liability for losses,
damages, and expenses (including attorney fees) that may be incurred on account
of any action taken by Escrow Agent in good faith pursuant to this Agreement,
and such parties do hereby severally indemnify Escrow Agent and
UPS/Tumbleweed Confidential December 18, 1997
undertake to hold harmless Escrow Agent from and against any and all claims,
demands, or actions arising out of or resulting from such performance by Escrow
Agent under this Agreement.
Section 9
CONTINUED ABILITY TO PERFORM OBLIGATIONS
The parties hereto respect and warrant that they have full power and
authority to undertake the obligations set forth in this Agreement and that they
have not entered into, nor will they enter into, any other agreements that would
render them incapable of satisfactorily performing their respective obligations
hereunder or that would place them in a position of conflict of interest or be
inconsistent or in conflict with their respective obligations hereunder.
Section 10
TERM OF AGREEMENT
The term of this Agreement shall commence on the effective date hereof and
shall continue until the Source Code shall be transferred to UPS pursuant to the
terms hereof, or, if such transfer shall not have so occurred, this Agreement
shall terminate and the Source Code shall be returned to Tumbleweed upon the
expiration of the License Agreement, including any renewals of the term thereof.
UPS/Tumbleweed Confidential December 18, 1997
Section 11
MISCELLANEOUS
11.1 COMPLIANCE WITH LAWS. The parties hereto agree that they will comply
with all applicable laws and regulations of governmental bodies or agencies in
their respective performance of obligations under this Agreement.
11.2 NO UNDISCLOSED AGENCY; NO ASSIGNMENT. Each party represents that it
is acting on its own behalf and is not acting as an agent for or on behalf of
any third party. Escrow Agent may not assign its rights or delegate its duties
under this Agreement without the prior written consent of the other parties
hereto. Neither Tumbleweed nor UPS may assign its respective rights or delegate
its respective duties hereunder except in connection with a permitted assignment
and delegation of such party's respective rights and duties under the License
Agreement. Notwithstanding any substitution of a new escrow agent, all other
terms of this Agreement shall remain in effect.
11.3 NOTICES. All notices, requests, demands or other communications
required or permitted to be given or made under this Agreement shall be in
writing and shall be given by personal service, UPS Next Day Air, telecopy, or
by United States certified mail, return receipt requested, postage prepaid to
the addresses set forth below, or such other address as changed through written
notice to the other party.
If to UPS:
United Parcel Service
00 Xxxxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
With a copy to Xxx Xxxx (same address); Telecopy: (000) 000-0000
If to Tumbleweed:
Tumbleweed Software Corp.
0000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxx, Xxxxxxxxxx 00000
Attn: President
Telecopy: (000) 000-0000
If to Escrow Agent:
DSI
Contract Administration
UPS/Tumbleweed Confidential December 18, 1997
Suite 200
0000 Xxxxxxxxxx Xxxxx
Xxx Xxxxx, XX 00000
Facsimile: (000) 000-0000
Notice given by personal service shall be deemed effective on the date it is
delivered, notice sent by UPS Next Day Air shall be deemed effective one
Business Day after dispatch, notice given by telecopy shall be deemed effective
on the date of transmission, and notice mailed shall be deemed effective on the
third Business Day following its placement in the mail.
11.4 GOVERNING LAW. All questions concerning the validity, operation,
interpretation, and construction of this Agreement shall be governed by and
determined in accordance with the laws of the State of New York, excluding its
conflict of law rules.
11.5 NO WAIVER. No party shall, by mere lapse of time, without giving
notice or taking other action hereunder, be deemed to have waived any breach by
the other party or parties of any of the provisions of this Agreement. Further,
the waiver by any party of a particular breach of this Agreement by any other
party shall be construed as or constitute a continuing waiver of such breach or
of other breaches of the same or other provisions of this Agreement.
11.6 FORCE MAJEURE. No party shall be in default if failure to perform any
obligation hereunder is caused solely by supervising conditions beyond such
party's control, including acts of God, civil commotion, strikes, labor
disputes, or governmental demands or requirements.
11.7 PARTIAL INVALIDITY. If any part, term, or provision of this Agreement
shall be held illegal, unenforceable, or in conflict with any law of a federal,
state, or local government having jurisdiction over this Agreement, the validity
of the remaining portions or provisions hereof shall not be affected thereby.
11.8 COMPLETE STATEMENT OF AGREEMENT. The parties hereto acknowledge that
each has read this Agreement, understands it, and agrees to be bound by its
terms. The parties further agree that this Agreement is the complete and
exclusive statement of agreement respecting the subject matters hereof, and
supersedes all proposals (oral and written), understandings, representations,
conditions, warranties, covenants, and all other communications between the
parties relating hereto.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective duly authorized representatives as set forth below:
UPS/Tumbleweed Confidential December 18, 1997
Tumbleweed Software Corp. United Parcel Service General Services Co.
By: By:
------------------------------ ----------------------------------------
Title: Title:
--------------------------- -------------------------------------
Date: , 199 Date: , 199
--------------------- -- ------------------------------- --
Data Securities International, Inc.
By:
------------------------------
Title:
---------------------------
Date: , 199
--------------------- --
UPS/Tumbleweed Confidential December 18, 1997
EXHIBIT G
MARKETING SUPPORT SERVICES
[ * ]
---------------
*Confidential treatment has been requested with respect to certain
information contained in this document. Confidential portions have been
omitted from the public filing and have been filed separately with the
Securities and Exchange Commission.
UPS/Tumbleweed Confidential December 18, 1997
Exhibit H
[Reserved]
UPS/Tumbleweed Confidential December 18, 1997
EXHIBIT I
SERVER SOFTWARE SUBLICENSE TERMS
--------------------------------
Any agreement between UPS and any Server Sublicensee shall contain rights
consistent with those enumerated in the Agreement, except that the agreement
must also include terms at least as protective of Tumbleweed's interests in
the Server Software and Custom Server Software (collectively, the "Server
Software") and in the Client Software and Custom Client Software
(collectively, the "Client Software" which, with the Server Software, is
collectively referred to herein as the "Software") as the following:
1. RESTRICTIONS. The license grant to use the Server Software and
reproduce and distribute the Client Software is not transferable, assignable
or sublicenseable. Server Sublicensee shall not, nor shall it authorize a
third party to, decompile, reverse engineer or disassemble the Software
except where such conduct is explicitly permitted under local law. Server
Sublicensee agrees to pay all required licensing fees and not to exceed the
scope of the licenses granted under the Agreement. Server Sublicensee
acknowledges and agrees that Tumbleweed may, at any time without notice,
incorporate license management software into the Server Software to prevent
Server Sublicensee from exceeding the scope of its license. Neither UPS nor
Tumbleweed has provided any license of its trademarks to Server Sublicensee.
2. OTHER RESTRICTIONS. Server Sublicensee shall retain any End User
license agreements included with the Client Software. Server Sublicensee
shall not remove, modify or obscure any proprietary rights notices in the
Software or logos or trademarks displayed in the Software or any documents
automatically generated by it. Server Sublicensee shall not distribute, in
connection with the Software or in the performance of reselling messaging
services, any viruses, trojan horses, worms, time bombs, cancelbots or other
programs containing computer programming defects which are intended to damage
or detrimentally interfere with a user's system or data.
3. OWNERSHIP. Except as otherwise provided in this Agreement, UPS and
its suppliers (including, without limitation, Tumbleweed) shall retain all
rights, title and interest in and to all copyrights, trademarks, trade
secrets, patents and all other industrial and intellectual property embodied
in or appurtenant to the Software. There are no implied licenses under this
Agreement, and any rights not expressly granted to Server Sublicensee
hereunder are reserved by UPS or its suppliers.
4. AUDIT RIGHTS. Server Sublicensee will keep for 3 years proper
records and books of account relating to Server Sublicensee's activities
regarding the Software. Once every 12 months, UPS or its designee may
inspect such records to verify Server Sublicensee's statements. Any such
inspection will be conducted on Server Sublicensee's office in a manner that
does not unreasonably interfere with Server Sublicensee's business
activities. Server Sublicensee shall immediately make any overdue payments
disclosed by the audit. Such inspection shall be at UPS's expense; PROVIDED,
HOWEVER, if the audit reveals overdue payments in excess of 5% of the
payments owed to date, Server Sublicensee shall immediately pay the cost of
such audit, and UPS may conduct another audit during the same 12 month
period. Server Sublicensee will make available to UPS all relevant records,
including but not limited to all records relating to activities outside of
the United States.
5. DISCLAIMER OF WARRANTY; NO PASS THROUGH. UPS shall be responsible
for any warranties extended to Server Sublicensee regarding the Software,
except that UPS shall have the
UPS/Tumbleweed Confidential December 18, 1997
right to pass through to Server Sublicensee the proprietary rights
indemnification of Tumbleweed, as set forth in Section 14(a) of the
Agreement. TUMBLEWEED AND ITS SUPPLIERS DISCLAIM ALL WARRANTIES, EXPRESS OR
IMPLIED, INCLUDING WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF TITLE,
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT.
Server Sublicensee shall make no warranties to End Users on behalf of UPS or
its suppliers.
6. SERVER SUBLICENSEE'S INDEMNITY. Server Sublicensee shall indemnify
UPS and its suppliers against any and all claims, losses, costs and expenses,
including reasonable attorneys' fees, which any of them may incur as a result
of claims in any form by third parties, including End Users, based upon (i)
any representations made by Server Sublicensee to such third parties which
are not supported by the Documentation and/or any other information or
materials supplied by UPS and/or its suppliers, or (ii) any acts committed by
Server Sublicensee's End Users during the course of their use of the Software.
7. LIMITATIONS ON LIABILITY. EXCEPT FOR ANY BREACHES OF SECTIONS
RELATING TO LICENSE GRANTS OR CONFIDENTIALITY, IN NO EVENT SHALL EITHER PARTY
BE LIABLE FOR LOST PROFITS OR SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES
ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT (WHETHER FROM BREACH OF
CONTRACT OR WARRANTY OR FROM NEGLIGENCE OR STRICT LIABILITY), EVEN IF SUCH
PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS LIMITATION
OF LIABILITY SHALL APPLY NOTWITHSTANDING THE FAILURE OF ESSENTIAL PURPOSE OF
ANY LIMITED REMEDY HEREIN. EXCEPT FOR TUMBLEWEED'S INDEMNIFICATION
OBLIGATIONS, IN NO EVENT SHALL TUMBLEWEED'S LIABILITY TO SERVER SUBLICENSEE
EXCEED THE AMOUNTS ACTUALLY RECEIVED BY TUMBLEWEED ATTRIBUTABLE TO SERVER
SUBLICENSEE.
8. GENERALLY. At its own expense, Server Sublicensee shall comply
with all applicable laws, regulations, rules, ordinances and orders regarding
its activities related to this Agreement. Without limiting the foregoing:
(a) Server Sublicensee shall fully comply with the relevant export
administration and control laws and regulations, as same may be amended from
time to time, to ensure that the Software is not exported (directly or
indirectly) in violation of United States law.
(b) Server Sublicensee shall comply with the U.S. Foreign Corrupt
Practices Act and shall not make any payments to third parties which would
cause UPS (or any of its suppliers) or Server Sublicensee to violate such
laws.
9. GOVERNMENT END USERS. The Software is a "commercial item,"
consisting of "commercial computer software" and "commercial computer
software documentation," and is provided to the U.S. Government only as a
commercial end item.
UPS/Tumbleweed Confidential December 18, 1997
