EXHIBIT 3.4
Master Services Agreement*
This Agreement, effective the 23th of August, 2000 (the "Agreement"), is made by
and between Cinema Internet Networks Inc. ("Company"), a corporation whose
principal office is located at Xxxx 00, Xxxxxxxxx Xxxxxx, 000-0000 Xxxxxxxx
Xxxxxx, Xxxxxxxxx XX, Xxxxxx, X0X0X0, and ELASTIC NETWORKS, INC. ("Elastic"),
whose principal office is located at 0000 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxx,
XX 00000.
IN CONSIDERATION of the mutual covenants and agreements set forth herein,
Company agrees to provide, and Elastic agrees to make payment in accordance with
the terms hereof for services as specified in Exhibit A ("Services") and
authorized by Work Orders ("Orders") which Elastic may issue from time to time
for performance of such Services as accepted by Company. The Services to be
provided hereunder shall be performed at such locations as specified in
individual Orders.
1. TERM
----
This Agreement shall become effective as of the date first written above
and shall remain in effect for a period of two years unless earlier terminated
in accordance with Section 14. hereof or renewed or otherwise extended by mutual
written agreement ("Term").
2. ORDERING
--------
Elastic may, but will not be obligated to, issue Orders for the purchase of
Services during the Term. Orders shall be similar to the format provided in
Exhibit B, and shall include a statement of work and specify the dates and
location(s) for the Services to be performed. Orders will be priced according
the rates and fees established in Exhibit A or as may otherwise be agreed to in
individual Orders. All Orders shall be accepted or rejected in writing by
Company within five (5) business days of receipt of such Orders. In the event
Company fails to provide its acceptance of an Order in writing within such five
(5) day period, such Order shall be deemed to be accepted; provided however,
that if Elastic has incorporated additional or special terms and conditions into
such Order, Company will have seven (7) business days to accept or reject such
Order or it shall be deemed to be accepted. Company will perform Services
specified in any Order in a timely manner and to the satisfaction of Elastic.
If Elastic provides Company with a forecast or estimate of the volume of
Services that it may order, Company acknowledges that Elastic will not be
obligated to submit Orders for all or any portion of such forecast or estimate.
3. ACCEPTANCE
----------
(a.) When Services are ordered by Elastic, Company shall, upon completion
of such Services, perform tests to verify that Elastic's hardware and software
products ("Products") function in accordance with Elastic's applicable product
and system specifications ("Specifications"). Upon completion and passing of
such testing, Company will provide Elastic with a turnover notice, in such form
and format as mutually agreed to, to be acknowledged in writing by Elastic
("Turnover Notice").
(b.) Within seven (7) business days after receipt of the Turnover Notice,
Elastic shall either accept the Services in writing ("Acceptance"), or notify
Company in writing, specifying in reasonable detail those particulars in which,
in Elastic's opinion, deficiencies in the Services result in
Confidential Page 1 of 9
------------
* Certain portions of this Exhibit have been omitted pursuant to a request for
confidential treatment submitted to the Securities and Exchange Commission.
The omitted portions of this Exhibit have been filed separately with the
Securities and Exchange Commission.
Product or system performance not in conformance with the Specifications. If
Acceptance does not occur within such seven (7) days after receipt of the
Turnover Notice or Elastic has not indicated to Company in writing its basis for
not accepting such Services, then Acceptance shall be deemed to have occurred.
(c.) Elastic shall not unreasonably withhold Acceptance. Company shall
correct any deficiencies identified by Elastic within seven (7) business days.
When Company has corrected such deficiencies to Elastic's satisfaction, Elastic
shall have seven (7) business days to accept the Services in writing. Elastic's
failure to either accept or provide notice of non-conformance within seven (7)
business days shall constitute Acceptance of Services.
(d.) Acceptance shall not be withheld or postponed solely due to:
(i) deficiencies of such Services resulting from (a) material change
or inaccuracy of information provided by Elastic, (b) material
inadequacy or deficiencies of any materials, information, facilities
or services provided directly or indirectly by Elastic and tested in
conjunction with the applicable Products, or spurious outputs from
adjacent material, or (c) other conditions external to the Products
which are beyond the limits specified by Elastic in the
Specifications; or
(ii) material deficiencies or shortages with respect to Products which
are attributable to Elastic, but of a nature that do not prevent
testing and operation of the remaining Products in revenue-generating
service.
With respect to any deficiencies of the type described in this Subsection 3.
(d.), Company shall, at Elastic's request and expense and in accordance with the
rates and fees in Exhibit A or as otherwise agreed to, assist Elastic in the
elimination or minimization of any such deficiencies.
(e.) In the event Elastic notifies Company of non-acceptance of a Product
and Company personnel travel to the Services site to remedy such non-acceptance
and the parties agree that non-acceptance is due to a deficiency of the type
described in Subsection 3(d.), Company will invoice Elastic for investigation of
the matter in accordance with the rates and fees in Exhibit A or as otherwise
agreed to.
4. RISK OF LOSS
------------
In conjunction with the provision of Services, Company may receive Products
from Elastic for storage and/or staging by Company. All risk of loss or
destruction of, or damage to, such Products shall transfer to Company during
such time as products are in Company's facilities or control. Under no
circumstances will title to such Products transfer to Company.
5. FEES, PAYMENT AND TAXES
-----------------------
(a.) Fees and Rates: Company shall invoice and Elastic shall pay for
---------------
Services in accordance with the fees and rates as set forth in the attached
Exhibit A, or as otherwise set forth in individual Orders. The Exhibit A fees
and rates will remain in effect throughout the Term of this Agreement; provided,
however, that either party may with thirty (30) days written notice, notify the
other of its wishes to review such fees and rates, and the parties will review
the rates on good faith and mutually agree upon changes in those rates, if any,
based on Company's actual costs in connection with the supply of Services,
changes in processes or procedures which result in cost savings or efficiencies
in Company's provision of Services, or other criteria as mutually agreed upon.
(b.) Payment: Company shall invoice upon completion of individual Orders.
--------
Invoices will include: (a) Order number; (b) location at which Services were
provided; and (c) a breakdown of charges according to the rates and fees in
Exhibit A or as otherwise set forth in individual Orders. Provided that Elastic
has accepted Services in accordance with Section 3 hereof, Elastic's payment
Confidential Page 2 of 9
------------
of undisputed invoices is due 45 days after Elastic's receipt of the invoice.
Elastic reserves the right to audit all invoices submitted to it, and Company
will afford reasonable access to all supporting documentation to enable Elastic
to do so.
(c.) Taxes and Duties. The payment of any and all taxes applicable to any
-----------------
transaction under this Agreement is the sole responsibility of Company. All
charges exclude all state and local taxes levied on Company's charges for the
Services furnished under this Agreement. Any such tax is the obligation of
Company and Elastic agrees either to pay Company amounts covering such taxes (as
determined by tax authorities) or to provide evidence necessary to sustain an
exemption therefrom.
6. CHANGE ORDERS; TERMINATION OF INDIVIDUAL ORDERS
-----------------------------------------------
(a.) Elastic may, at any time, issue Change Orders to make changes in the
work, price or scheduling stated in an Order; provided, however, that the
execution of a Change Order shall not affect the obligations of the parties with
respect to previously completed Services unless the Change Order expressly so
states. All Change Orders must be approved in writing by both parties.
(b.) If prompt agreement cannot be reached on any Change Order, or other
circumstances arise which in Elastic's sole judgement require termination of any
Order, Elastic may at any time terminate such Order with five (5) days notice to
Company; provided, however, that such termination shall not affect the
obligations of the parties with respect to previously completed Services under
such Order. Such termination of any individual Order shall not affect other
Orders issued hereunder or either party's remaining rights and obligations under
this Agreement.
7. ACCESS TO WORK
--------------
Elastic agrees to use its best efforts to obtain and/or make available to
Company, without charge, all facilities, services, consents and approvals
reasonably required by Company for the performance of Services pursuant to the
Agreement, including, but not limited to, obtaining all necessary consents and
approvals, and providing Company with access to the work site during reasonable
hours, suitable workspace and such technical materials, data and other
information reasonably determined by Company to be necessary for the performance
of such Services as outlined in the individual Orders.
8. PERSONNEL; ASSIGNMENT AND SUBCONTRACTING
----------------------------------------
(a.) Elastic will have the right, with reasonable cause and at any time, to
request that Company remove any Company employee or subcontractor from
performance of Services for reasons of performance or professionalism and
Company will replace, at no charge, such employee without interruption in
Services.
(b.) Company will not assign this Agreement without the prior written
consent of Elastic. With Elastic's prior written approval, Company may
subcontract any portion of its rights, duties or obligations with respect to an
Order, provided that: Company will continue to be fully responsible and liable
for full performance of any such Order and Company shall not be relieved of any
of the duties, obligations and liabilities pursuant to this Agreement.
9. INDEPENDENT CONTRACTOR AND INSURANCE
------------------------------------
(a.) Independent Contractor: It is understood and agreed that this
-----------------------
Agreement does not create any relationship of association, partnership or joint
venture between the parties, nor does it create any implied licenses, nor
constitute either party as the agent or legal representative of the other for
any purpose whatsoever; and the relationship of Company to Elastic for all
purposes,
Confidential Page 3 of 9
------------
including but not limited to, federal and state tax purposes, shall be one of
independent contractor. Neither party shall have any right or authority to
create any obligation or responsibility, express or implied, on behalf or in the
name of the other, or to bind the other in any manner whatsoever. Company shall
indemnify, defend and hold harmless Elastic from all losses, damages, and costs
(including, without limitation, attorney's fees) and amounts agreed upon in
settlement or awarded in connection with any claim, suit or proceeding alleging
that Company and/or any Company employee has a relationship with Elastic that is
other than an independent contractor relationship.
(b.) Insurance: Company represents and warrants that during the Term it
----------
shall either: (i) maintain adequate workers' compensation insurance and other
employee insurance coverages required by law; or (ii) pay or cause to be paid
any and all assessments or contributions required to be paid pursuant to
applicable workers' compensation law. If Company fails to do either of the
above, Elastic, in addition to any other rights reserved to it under this
Agreement, may, but shall not be obligated to, deduct the amount of any such
assessments or contributions from any payment then due or later due to Company
under this Agreement. In addition, Company represents and warrants that during
the Term it shall maintain general liability insurance with the limits of either
(US) $5,000,000 combined single limit per occurrence for bodily injury and
property damage or (US) $3,000,000 bodily injury per occurrence and (US)
$2,000,000 property damage per occurrence. Upon Elastic's request, Company shall
furnish certificates evidencing its insurance coverage, and Elastic reserves the
right at any time to immediately terminate or suspend performance of Services or
any portion thereof, if in the opinion of Elastic any such insurance coverage is
inadequate.
10. PROPRIETARY INFORMATION
-----------------------
(a.) Any information in any form provided by Elastic or by an Elastic end-
user to Company in connection with the performance of this Agreement or any
Order which is designated by Elastic or the end-user, either orally or in
written or other form, to be of a confidential or proprietary nature will be
deemed to be confidential information of Elastic or the end user, as the case
may be ("Confidential Information"). Such information may include, but is not
limited to, technical drawings, designs and concepts; software programs,
routines, formulae and concepts; production plans, designs, layouts and
schedules; marketing analyses, plans, Elastic data and surveys; and matters
relating to Elastic's finances, personnel, and Products.
(b.) Company shall have no obligation to protect information which is: (a)
in or becomes part of the public domain through no fault of Company; (b)
disclosed to Company by a third party without restriction; (c) known to Company
at the time of disclosure and is so documented; or (d) independently developed
by Company without access to any information furnished to it by Elastic and is
so documented.
(c.) Company will not use the Confidential Information for any purpose
other than the satisfaction of Company's obligations under this Agreement. All
Confidential Information will be held in confidence by Company and disclosed on
a "need to know" basis only to its employees, and/ or its contractors or
subcontractors who are bound by written agreement with Company to comply with
use and non-disclosure restrictions substantially the same as those stated
herein.
(d.) All Confidential Information will be owned by and remain the sole and
exclusive property of Elastic or the end user, as the case may be, and all
rights to Confidential Information will be held in trust by Company for the
exclusive benefit of Elastic or the end user, as the case may be Upon request by
Elastic or the end user, Company shall promptly, and in any event not later than
fourteen (14) days after such request, return all Confidential Information in
tangible form and destroy any Confidential Information in other than tangible
form that cannot reasonably be returned and provide written confirmation that
all such actions have been taken to return or destroy all such Confidential
Information.
Confidential Page 4 of 9
------------
(e.) Company acknowledges that monetary damages may not be adequate in the
event of a default of this Section by Company, and that Elastic will be entitled
to injunctive or other affirmative relief and/or to give notice of default
pursuant to Section 14, or both.
(f.) Company will not in any advertising, sales promotion materials, press
releases or any other publicity matters use the name "Elastic Networks", any
variation thereof or language from which the connection of said name may be
implied, nor will Company disclose, unless required by law, or advertise in any
manner the nature of Services performed or any Order or the fact that it has
entered into this Agreement, unless Elastic, in its sole discretion, grants
Company prior written permission to do so. In the event Company is required by
law to disclose the nature of Services to be performed hereunder, Company will
notify Elastic and allow Elastic the opportunity to redact sensitive information
or take such other actions as Elastic deems necessary to protect its
Confidential Information.
11. INDEMNIFICATION AND LIMITATION OF LIABILITY
--------------------------------------------
(a) Notwithstanding anything to the contrary in this Agreement, Company
will indemnify, defend and hold Elastic free and harmless from any losses,
damages, liabilities and costs (including, without limitation, attorneys' fees)
and amounts agreed upon in settlement or awarded in connection with any claim,
suit or proceeding, either attributable to any negligent act or omission or
willful misconduct of Company and/or any Company employee or subcontractors,
including, but not limited to, any of such which arise from any injury or death
to persons or loss of or damage to property, and which are in any way connected
with or arise out of this Agreement or the performance of Services or
infringement by Products, any portion thereof or the use thereof of any
copyrights, patents, trademarks, trade secrets, mask works or other intellectual
property rights, to the extent not caused by or arising from the negligent acts
or omissions of Elastic or any intellectual property infringement caused by
Elastic.
(b.) EXCEPT FOR PERSONAL INJURY, DAMAGE TO PROPERTY OR BREACH OF
CONFIDENTIALITY AND INTELLECTUAL PROPERTY RIGHTS, NEITHER COMPANY OR ELASTIC NOR
ANY OF THEIR AFFILIATES OR SUBSIDIARIES, WILL BE LIABLE FOR ANY INDIRECT,
INCIDENTAL, SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR FOR LOST
PROFITS, SAVINGS OR REVENUES OF ANY KIND.
12. LIMITED WARRANTY
-----------------
Company warrants 1.) that it will perform Services in a good and
workmanlike manner; 2.) that it shall not violate any applicable law, rule or
regulation; and 3.) that Services provided by Company will (i) conform to
Elastic's Specifications and applicable procedures or other requirements of this
Agreement and requirements, if any, which are described on or attached to a
particular Order and (ii) will be free from defects in material and workmanship
for one (1) year following the date of acceptance by Elastic. Company will
promptly correct any failure of Services or parts to conform to the above
warranties at no cost to Elastic. Company shall observe safety and security
policies in place at the site(s) at which Services are performed. With respect
to equipment, parts and materials (collectively referred to as "Goods")
installed by Company, whether procured by Elastic or Company, the respective
manufacturers' warranties shall apply, and Company makes no warranty with
respect thereto. Company's sole obligation under its warranty above shall be
to make such changes and corrections with respect to such Services as may be
required to cause the same substantially to conform to the foregoing warranty;
provided, however, that such warranties shall be void and of no effect to the
extent any such failure to conform is due to the implementation which is the
subject of any Services performed by Company having been used, altered, or
operated in any manner or in any environment not consistent with the intended
purpose, or modified or repaired in any manner not in accordance with common
industry practices. THE WARRANTIES AND REMEDIES SET FORTH IN THIS SECTION 13
CONSTITUTE THE ONLY WARRANTIES WITH RESPECT TO ANY SERVICES PERFORMED OR GOODS
PROCURED BY COMPANY OR ELASTIC, AND THE EXCLUSIVE
Confidential Page 5 of 9
------------
REMEDIES IF SUCH WARRANTIES ARE BREACHED; AND SUCH WARRANTIES ARE IN LIEU OF ALL
OTHER WARRANTIES, EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING,
BUT NOT LIMITED TO, ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, EVEN IF COMPANY HAS BEEN ADVISED AS TO THE POSSIBILITY OF
SUCH DAMAGES.
13. TERMINATION AND DEFAULT
-----------------------
(a.) Either party may terminate this Agreement without penalty at the end
of the initial Term or any additional Term by giving 90 days prior written
notice to the other.
(b.) Elastic may terminate this Agreement, without penalty, if Company
fails to perform or observe any material term or condition of this Agreement and
such failure continues un-remedied for thirty (30) days after Company's receipt
of written notice from Elastic. Elastic will be in default of this Agreement and
Company may terminate this Agreement, without penalty, if Elastic fails to pay
any charge when due or fails to perform or observe any other material term or
condition of this Agreement and such failure continues un-remedied for thirty
(30) days after Elastic's receipt of written notice from Company.
(c.) Upon the termination of this Agreement for any reason, Company shall
promptly return any and all property owned by Elastic and in Company's
possession to such location as may be designated by Elastic.
(d.) The obligations of the parties set forth in Sections 3, 4, 5, 9, 11,
12 and 13 hereof shall survive termination or expiration of this Agreement.
13. AMENDMENTS AND SEVERABILITY
---------------------------
This Agreement may not be amended or modified, nor may any right hereunder
be waived except by a written agreement signed by both parties hereto. Any term
or provision of this Agreement which is invalid or unenforceable in any
jurisdiction will, as to such jurisdiction, be ineffective to the extent of such
invalidity or unenforceability without rendering invalid or unenforceable the
remaining terms and provisions of this Agreement or affecting the validity or
enforceability of any of the terms or provisions of this Agreement in any other
jurisdiction.
15. NOTICES
-------
Except as otherwise specifically provided in this Agreement, all notices
which either party is required or desires to give to the other under this
Agreement, shall be in writing and sent postage prepaid, by registered or
certified mail, or by a major overnight courier service with tracking
capabilities, addressed to the party for which intended at its address indicated
above, as the same may be changed from time to time by notice similarly given.
16. GOVERNING LAW
-------------
This Agreement shall be governed by and construed in accordance with the
laws of the State of Georgia USA without giving effect to its principles of
conflicts of law. In any action or proceeding to enforce its rights under this
Agreement, the prevailing party shall be entitled to recover reasonable
attorney's fees and costs.
Confidential Page 6 of 9
------------
17. MISCELLANEOUS PROVISIONS
-------------------------
Headings. The headings of the Articles and Sections of this Agreement are
--------
inserted for convenience only and shall not affect the meaning or interpretation
of this Agreement or any provision thereof.
Assignments; Binding Effect. This Agreement shall be binding upon and shall
---------------------------
inure to the benefit of the parties hereto and their respective successors or
assigns; provided, however, that neither party shall assign or transfer its
rights or obligations under this Agreement without the prior written consent of
the other party, which consent shall not be unreasonably withheld or delayed.
Notwithstanding the foregoing, either party may assign this Agreement without
such consent to any affiliate or to any entity that is a successor to that party
by merger or consolidation or that acquires substantially all of that party's
assets. For purposes of this Article, "affiliate" shall mean a person or entity
that directly or indirectly, through one or more intermediaries, controls or is
controlled by, or is under common control with the specific party.
Entire Agreement. This Agreement, including any attachments, exhibits and
----------------
schedules referred to herein and attached, constitutes the entire agreement
between the parties pertaining to the subject matter hereof and supersedes any
and all prior agreements, representations and understandings of the parties,
written or oral.
Waiver. No waiver by either party of the other party's breach of any term,
------
covenant or condition contained in this Agreement shall be deemed to be a waiver
of any subsequent breach of the same or any other term, covenant or condition of
this Agreement.
IN WITNESS WHEREOF, the parties have caused their authorized representatives to
execute this Agreement as of the date first above written.
CINEMA INTERNET NETWORKS INC. ELASTIC NETWORKS, INC.
By: /s/ Xxxxxxx Xxxxxx By: /s/ Xxxxx Elop
----------------------------- ----------------------------
Signature Signature
Title: Xxxxxxx Xxxxxx, CEO Title: Xxxxx Elop, CEO
-------------------------- -------------------------
Printed Name and Title Printed Name and Title
Date: August 24, 2000 Date: August 25, 2000
-------------------------- -------------------------
Confidential Page 7 of 9
------------
Exhibit A
Description of Services to be provided:
---------------------------------------
Installation services for Elastic's EtherLoop modems, multiplexers, servers, and
associated equipment and materials items.
1. Time and Materials Hourly Rates and Fees:
----------------------------------------
Regular Overtime Holiday
------- -------- -------
Lead Technician: $* per-hour N/A Time and a half ($*)
Technician: $* per-hour N/A Double time ($*)
Travel and Perdiem: Company will invoice Elastic for all reasonable travel
------------------
costs and other expenses incurred by its personnel in connection with providing
services under this Agreement. Company will invoice separately for travel and
other expenses when incurred, and will include copies of supporting
documentation sufficient for Elastic to audit the invoiced amounts.
Material and Equipment: Purchase of any required materials or equipment
----------------------
will be subject to prior approval by Elastic.
2. Hospitality Per-Line Installation Rate: $* per-line.
--------------------------------------
For hospitality installations priced on a per-line basis, Elastic will,
with its Work Order, provide a Site Survey identifying the total number of guest
room lines to be installed and details on the proposed installation. The total
per-line rate includes all Services necessary for installation of the number of
guest room lines specified in the Site Survey. Per-line rates include
installation of telecommunications room equipment, but do not include
incremental Services to install administrative or conference room lines. For
installs accepted by Company at the per-line rate, Company shall estimate the
additional cost (including labor and materials but excluding travel cost)
required to install any administrative or conference room lines and to provide
any other Services which may be desired by Elastic ("Additional Services").
Company shall advice Elastic of its cost estimate for Additional Services and
will not proceed with the Additional Services until mutual agreement has been
reached on the extent and cost of the Additional Services and Elastic has issued
a written Change Order (which will typically be issued by e-mail) confirming
such agreement. Company may reject the Change Order; provided that Company shall
do so within 2 days of issuance or the Change Order will be deemed accepted.
Company will invoice and Elastic will pay for Additional Services on a time and
materials basis; provided that Company will not exceed the total labor and
materials cost specified in the Change Order without prior written permission
from Elastic. Elastic shall have no obligation to pay labor and materials
amounts in excess of the total cost specified in the Change Order if Company
fails to obtain such written permission.
All reasonable travel costs incurred for installs performed on a per-line
basis will be billed back to Elastic and will be in addition to the per-line
rate and any amounts for labor and materials payable under a Change Order.
Confidential
------------
* Certain portions of this Exhibit have been omitted pursuant to a request for
confidential treatment submitted to the Securities and Exchange Commission.
The omitted portions of this Exhibit have been filed separately with the
Securities and Exchange Commission.
Page 8 of 9
Exhibit B
WORK ORDER # [fill in Order # here]
-----------------------------------
Pursuant to the Master Agreement between Elastic Networks, Inc. ("Elastic") and
Cinema Internet Networks Inc. ("Company") dated [insert agreement date here],
-----------------------------
Elastic issues this Order for Services as follows:
Statement of Work:
------------------
Location at which Services are to be performed:
-----------------------------------------------
Period of Performance:
----------------------
Special instructions:
---------------------
Confidential Page 9 of 9
------------
