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Exhibit 10.10
SPECIFIC CO-OPERATION AND DEVELOPMENT AGREEMENT
between
ERICSSON TELECOM AB
and
XX.XXX
For COMMUNITIES and LINK
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[TABLE OF CONTENTS TO BE UPDATED]
1 Background 3
2 Virtual company 3
3 Ordering procedures/Revenues and costs 4
4 Contact persons 5
5 Amendment of the development work 7
6 Insurance 7
7 Term 7
8 Copies of the Agreement 7
Appendix 1: Frame Purchase Order
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3(7)
This Specific Co-operation and Development Agreement is made between:
Ericsson Telecom AB ("Ericsson"), registration number 556251-3258, a
limited liability company duly incorporated under the laws of Sweden
and having its principal place of business at Telefonplan, X-000 00
Xxxxxxxxx, Xxxxxx,
and
XX.XXX ("OZ"), U.S. tax identification number 00-0000000, a
corporation duly incorporated under the laws of California and having
its principal place of business at 000 Xxxxxxx Xxxxxx, Xxxxxx Xxxxx,
Xxx Xxxxxxxxx, XX 00000, U.S.A.
Ericsson and OZ are hereinafter also referred to as individually the
"Party" or collectively the "Parties".
1 BACKGROUND
1.1 This Specific Co-operation and Development Agreement (the "SCDA") is
an agreement under the General Co-operation and Development Agreement
(the "GCDA") between the Parties entered into on even date herewith,
and the terms and conditions set out therein shall form an integral
part of this SCDA.
1.2 The defined terms used in the GCDA shall have the same meaning in this
SCDA, unless the context would obviously require otherwise.
1.3 The conditions specified herein shall apply to any Development Work
executed by OZ for Ericsson according to Appendix 1, unless otherwise
agreed in writing in a Purchase Order issued by Ericsson and confirmed
by OZ in writing. Ericsson's General Purchasing Conditions, even if
enclosed to the Purchase Order, shall not apply to any Development
Work.
2 VIRTUAL COMPANY
2.1 The Development Work around the Community/LINK will be organised in a
form that shall resemble a real small company, i.e. a virtual company
(hereinafter the "Company"). The Company will, however, not be a legal
entity of its own and will not be deemed to be a partnership in the
legal sense of that term.
2.2 Each Party will contribute personnel both at the management and board
level and in the day-to-day Development Work as further specified
herein. However, Ericsson will be the ordering Party and OZ shall
perform the Development Work on assignment from Ericsson.
2.3 The Product Unit IP Services within Ericsson's business unit Datacom
Networks & IP Services will be the Ericsson representative delivering
the assignments, unless Ericsson decides otherwise and informs OZ of
such change.
2.4 A board of directors (the "Board") will be responsible for management
of the Company. Ericsson shall appoint the majority number of the
Board members. OZ will have at least one member of the Board. In case
of different opinions of the Board, each Board member shall discuss
internally with its respective company and then the Board shall
reconvene within fifteen (15) days to resolve the issue. In case
Ericsson and OZ have different opinions the opinion of Ericsson shall
prevail.
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4(7)
2.5 The Company will be headed by a Managing Director ("MD"), who shall
report on a regular basis to the Board. The MD will be responsible for
operating the business on a daily basis, following the guidelines and
directives set out by the board of directors.
2.6 Initially, the Company's organisation will be project driven, focusing
on the defined Solution and marketing strategies and timely delivery of
the first functional Solution prototype.
2.7 All Development Work shall be performed by teams that would normally
consist of personnel from both Ericsson and OZ. The teams will have the
main responsibility in the areas of product provisioning, marketing and
customer support.
2.8 Decision making shall be delegated to the different teams in order to
avoid bottlenecks in the decision making process and to create commitment
by the team members and a speedy process. The teams shall be encouraged
to decide on e.g. distribution of work and technical solutions.
2.9 The teams shall be manned with the most appropriate personnel, regardless
of which Party they represent. Mixed teams with personnel from both
Ericsson and OZ shall be encouraged.
3 ORDERING PROCEDURES/REVENUES AND COSTS
3.1 Ericsson shall order Development Work by issuing Purchase Order(s)
consistent with this SCDA and the Frame Purchase Order attached hereto,
Appendix 1.
3.2.1 Revenues from sales under this SCDA shall be shared between the Parties
as set out below.
Ericsson OZ
85% 15%
3.2.2 The Parties have agreed on the following levels and distribution of
costs:
OPERATING COSTS.
Ericsson OZ
Sales and marketing
32% of sales 95% 5%
General and Admin.
20% of sales 95% 5%
Development (improved platform,
made by OZ)
2% of sales 0% 100%
Customer support ("give away")
3% of sales 66% 34%
3.3 The hourly fee shall cover actual costs related to personnel, including
salaries and salary-related costs, compensation for overtime and taxes
and costs for work places including PC/workstation, furniture and office
equipment, related to the design and
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5(7)
test personnel that work on the project. Such price shall also cover
assignment specific costs for methods and tools. The hourly fee shall not
include a profit margin.
3.4 The hourly fee shall not cover costs for travelling. Travelling expenses
and allowances shall, If such travel is approved in writing by Ericsson, be
payable in accordance with the travelling compensation regulations of
Ericsson. Compensation for travelling time shall however, not be payable.
OZ shall receive compensation for verified disbursements agreed to in
advance.
3.5 The hourly fee shall not cover assignment specific costs for test
equipment. Costs for specific test equipment shall, if such equipment is
approved in writing by Ericsson, be born by Ericsson.
3.6 The hourly fee shall not cover costs for general administration. OZ' costs
for general administration related to development work performed for
Ericsson shall be invoiced to Ericsson as additional man hours, with the
same cost per man hour as agreed for development work. Such cost shall be
calculated as 10% of the invoiced fee for development work.
3.7 The hourly fee shall not cover project related costs for project
management, product management, product marketing, quality control,
demonstration assistance, etc. Such costs shall be invoiced to Ericsson as
payment for actually worked man hours, with the same cost per man hour as
agreed for design hours.
3.8 When either Party's personnel are stationed in the other Party's premises,
appropriate workstations, furniture and office equipment shall be provided
free of charge by the hosting Party.
3.9 Ericsson is responsible for supplying OZ with a forecast of how many hours
of work that is expected to be ordered each year, as detailed in Appendix
1. A quarterly review of the resource planning and possible impacts on this
SCDA shall be made, and the result thereof shall be reported to the Board.
3.10 When ordering Development Work, Ericsson shall issue a Purchase Order that
includes:
a) the number of man hours that are ordered;
b) any specific requirements on personnel;
c) any specific requirements on reporting routines; and
d) any other specific requirements related to the assignment
4 CONTACT PERSONS
4.1 Any notice required or permitted to be given by either Party shall be in
writing and may be sent by registered airmail letter, by telefax, by
electronic mail confirmed by registered airmail letter, or by personal
delivery.
Such notice shall be deemed to be given
- if sent by registered airmail letter -- five days after the day of
dispatch,
- if sent by telex, telefax or electronic mail -- on the day of dispatch
of the letter of confirmation,
- if sent by personal delivery -- on the day of delivery.
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4.2 Any notices shall be delivered to the Parties contact person set out
below.
Commercial matters
Ericsson
Name: Xxxx Skogli
Address: Ericsson Telecom AB
Product Unit IP Services
X-000 00 Xxxxxxxxx
Xxxxxx
Telephone: x00 (0) 0 0000000
E-mail: xxxx.xxxxxx@xxx.xxxxxxxx.xx
OZ
Name: Xxxxx Xxxxxxxx
Address: XX.XXX
Xxxxxxxxxxx 00
000 Xxxxxxxxx
Xxxxxxx
Telephone: x000 000 0000
E-mail: xxxxx@xx.xx
Technical matters
Ericsson
Name: Xxxxx Xxxxxxxx
Address: Ericsson Telecom AB
Product Unit IP Services
X-000 00 Xxxxxxxxx
Xxxxxx
Telephone: x00 (0) 0 0000000
E-mail: xxxxx.xxxxxxxx@xxx.xxxxxxxx.xx
OZ
Name: Xxxxxxx Xxxxxxxx
Address: XX.XXX
Xxxxxxxxxxx 00
000 Xxxxxxxxx
Xxxxxxx
Telephone: x000 000 0000
E-mail: xxxxxxx@xx.xx
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5 AMENDMENTS OF THE DEVELOPMENT WORK
Amendments, additions to or limitations of the Development Work must be in
writing and executed by the Parties to be valid. However, amendments of
fixed prices or of Frame Purchase Order limits must, to be valid, be made
through a decision by the Board of the Company. Each Party undertakes to
propose such alterations of the Development Work that it considers would
improve the result with respect to technical features, costs or otherwise
in favour of any Party.
6 INSURANCE
6.1 OZ shall ensure that it is insured against accidents, torts and third-party
liability for adequate amounts, however not less than SEK ten million
(10.000.000), during each calendar year. This insurance shall also cover
Ericsson's documents in OZ's possession and resources provided by Ericsson
that are in OZ's custody.
6.2 OZ shall upon request by Ericsson be able to present a certificate of
insurance.
7 TERM
This SCDA shall be effective from the date of its execution until December
31, 2001. Unless terminated by either Party's written notice, the term of
this SCDA shall be extended one (1) year at the time.
8 COPIES OF THE AGREEMENT
This SCDA has been made in two (2) original copies, of which Ericsson and
OZ have received one each.
IN WITNESS WHEREOF, this SCDA has been duly signed by the Parties hereto,
at the places and on the days written below.
ERICSSON TELECOM AB XX.XXX
By: /s/ Xxxx Xxxxxxxx By: /s/ Xxxxx Xxxxxxxx
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Xxxx Xxxxxxxx Xxxxx Xxxxxxxx
Vice President Chief Executive Officer
Stockholm, Feb 4, 1999 Feb 4th 99 Stockholm, 1994
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Date and place Date and place
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Appendix 1 to SCDA
FRAME PURCHASE ORDER FOR FOR DEVELOPMENT WORK ORDERED BY ERICSSON FROM
OZ FOR COMMUNITIES/LINK.
1 PARTIES
Ericsson Telecom AB, Stockholm, Sweden ("Ericsson") xx.xxx inc, San
Francisco, USA ("OZ")
2 GENERAL
This Frame Purchase Order sets forth specific terms applicable when
development work is ordered by Ericsson from OZ under the Special
Cooperation and Development Agreement.
3 RESOURCE PLANNING
Ericsson shall quarterly by means of a resource planning process
submit a rolling forecast for new assignments planned according to
this Frame Purchase Order for the next six to twelve months.
The board of the virtual company may decide to change and update this
Frame Purchase Order, based on the result of the quarterly review of
the resource planning.
OZ shall maintain and quarterly submit to the Ericsson an overview
plan of committed assignments according to this Frame Purchase Order,
of available resources and competence and resource limits.
The resource planning will be used as a basis for financial estimates.
Consequently the invoicing of current account assignments shall
correspond to the resource plan submitted. In case of significant
deviations from the resource plan it is the obligations of OZ to
promptly notify Ericsson in advance.
4 FRAME
The following design frame is estimated to be handled by OZ during
1999:
Orderer
Design Area Maximum Volume Receiver
----------- -------------- --------
Community/LINK 30.000 man-hours * Xxxx Skogli (ETX)
** Birgir Thrainsson (OZ)
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* Person authorised to sign orders within the defined Maximum
Volume
** Person authorised to receive and confirm orders within the
defined Maximum Volume
Note: Maximum Volume shall be indicated in orders and invoices.
The special competence of the persons performing the
development work, if any, shall be stated by Ericsson in
each order.
Should any party to this Frame Purchase Order fail to meet
the undertaking specified in an order, the failing party has
to carry the extra costs, if any, necessary to remedy such
failure (e.g. procure replacement resources/assignments).
5 PRICE
For current account assignments during 1999 the price will be 72 USD
per man hour.
The costs to be covered by the manhour price is specified in Special
Cooperation and Development Agreement.
