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Exhibit 10.27
COMPAQ/TCS MASTER AGREEMENT
THIS MASTER AGREEMENT (this "Agreement") is effective as of the 5th day
of June 2000 (the "Effective Date"), by and between COMPAQ COMPUTER CORPORATION
(hereinafter "Compaq"), a Delaware corporation, having principal offices at
0000 X. 00xx Xxxxxx, Xxxxx 0000, Xxxxx, XX 00000-0000, and TELECOMMUNICATION
SYSTEMS, INC. (hereinafter "TCS"), a Maryland corporation, having principal
offices at 000 Xxxx Xxxxxx, Xxxxxxxxx, XX 00000, and which collectively may be
referred to herein as the "Parties":
WITNESSETH:
WHEREAS, Compaq manufactures certain computer equipment and produces certain
computer software programs compatible with such computer equipment, consisting
of the basic operating system of such computer equipment and the related
application software, tools, and utilities, all of which Compaq is willing to
provide to TCS on the terms and conditions set forth herein; and
WHEREAS, TCS intends to combine such computer equipment and computer programs
with other equipment and/or software programs so as to create certain "TCS
Product(s)" and to market such TCS Product(s) to end-users; and
NOW, THEREFORE, in consideration of the premises hereof, and the mutual
obligations herein made and undertaken, the parties hereto agree as follows:
1. DEFINITIONS. For the purposes of this Agreement, the definitions set
forth in this Section shall apply to the respective capitalized terms:
1.1 "COMPUTER EQUIPMENT." The hardware products (including all model
conversions, elements, and accessories) that are listed in the attached Exhibit
A, which may be supplemented or amended from time to time by mutual written
agreement.
1.2 "DEMONSTRATION/DEVELOPMENT SYSTEMS." A generally available version
of Computer Equipment and Programs to be procured by TCS from Compaq under this
Agreement for use in the creation and demonstration of TCS Products.
1.3 "DISTRIBUTOR." Currently, Hallmark. Other distributors of Compaq
equipment may be identified as necessary.
1.4 "DOCUMENTATION." Those printed instructions, manuals, and diagrams
pertaining to the Programs to be furnished therewith. Documentation media may
be in soft copy form.
1.5 "END-USER." A prospective customer of TCS or Compaq to whom one of
the Parties offers its products for use in the regular course of such
customer's business and not for resale.
1.6 "END-USER LICENSE AGREEMENT." The form of agreement under which
TCS directly grants an End-User the right and license to use Programs on the
Computer Equipment.
1.7 "ENHANCEMENT(s)." Computer program modifications or additions,
other than Maintenance Modifications, that may be integrated with the Programs
or offered separately and that alter the functionality of the Program or add
new functions thereto.
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1.8 "ERROR." A defect in a Program that prevents it from functioning
in substantial conformity with the published Specifications pertaining thereto.
1.9 "MAINTENANCE MODIFICATION(s)." Computer software changes to be
integrated with the Programs to correct any Errors therein, but that do not
alter the functionality of the Programs or add new functions thereto.
1.10 "MARKETING TERRITORY." North, Central and South America.
1.11 "OBJECT CODE." Computer programs assembled or compiled in
magnetic or electronic binary form on software media, which are readable and
usable by machines, but not generally readable by humans without
reverse-assembly, reverse-compiling, or reverse-engineering.
1.12 "PROGRAMS." The computer software, consisting of the Compaq
Software and TCS Software, including all Maintenance Modifications and
Enhancements thereto.
1.12.a. "COMPAQ SOFTWARE." The Programs (in Object Code only)
owned by Compaq which constitute the basic operating system, application
software, tools, and utilities of the Computer Equipment to be offered by TCS
to End-Users.
1.12.b. "TCS SOFTWARE." The Programs (in Object Code only) owned
by TCS which consist of wireless communications application software, together
with related services. TCS Software is to be provided to End-Users by Compaq in
unmodified form.
1.14 "SUBLICENSE." The form of agreement to be entered into between
TCS or Compaq and each End-User, which grants the End-User the right and
license to use the Program. Each Sublicense shall prohibit the End-User from
any copying of the Programs, from any transfer of any Programs to any third
parties, and from any reverse-compiling, reverse-assembly, or
reverse-engineering of the Programs from the Object Code in which they are
distributed to End-Users.
1.15 "TCS PRODUCTS." One or more combinations of Computer Equipment
and Programs with other equipment and computer software independently developed
or procured by TCS, to be offered by TCS, together with related services, to
End-Users.
2. TERM. This Agreement will commence as of the Effective Date and will
continue in full force and effect for two years unless previously terminated in
accordance with the provisions herein. Notwithstanding any other provision in
this or subsequent modifications or riders to this Agreement, terminating
events or occurrences will be construed to terminate this Agreement only as to
the product or software application that is the object of the terminating event
and this Agreement will remain in force as to any other existing or
contemplated software application or product.
3. COMPAQ'S RESPONSIBILITIES. Subject to the terms and conditions of this
Agreement, Compaq shall:
1. Assist TCS in the development of a business arrangement between TCS
and one or more Compaq Distributors for the purpose of distribution,
installation and support of configurations of TCS Products delivered
to Compaq and TCS customers;
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2. Encourage its Distributor(s) to work with TCS to develop a joint
marketing plan for TCS Products. The plan may include target markets,
product positioning, and plans for advertising, trade shows,
collateral, publications, etc.;
3. Provide TCS with 40 hours of development support with the purchase of
each Demonstration/Development System, under Compaq's then current
terms, conditions and programs;
4. Provide technical product training with the purchase of each
Demonstration/Development System, for two TCS engineering/support
personnel at no charge under Compaq's then current terms, conditions
and programs. Additional training may be obtained by TCS at the then
current Compaq rates;
5. Offer TCS its standard technical support plans for End-Users and the
other technical support for the Computer Equipment at the then current
prices and as set forth in Section 7 hereof;
6. Offer TCS Enhancements to the Programs on terms no less favorable than
those offered to any other similarly situated reseller.
4. TCS'S RESPONSIBILITIES. Subject to the terms and conditions of this
Agreement, TCS shall:
1. Provide Compaq's Distributor(s) with reseller pricing discounts based
upon list prices and volume discount structure;
2. Commit the necessary resources and/or commission for a fee the
appropriate Compaq professional services in support of engineering
activities including but not limited to:
- Porting existing and future TCS Software products to Compaq
Computer Equipment;
- Certifying existing and future TCS hardware/software products on
the Compaq Computer Equipment;
- Performing functional and performance testing of joint product
offerings; and
- Developing engineering configurations for standard joint product
offerings.
3. Contract with Compaq or appropriate Compaq Distributors to provide
long term support for the Computer Equipment to End-Users.
4. Combine Computer Equipment and Programs with other equipment and/or
computer software programs independently developed or procured by TCS
so as to create TCS Products;
5. Market, sell, and deliver TCS Products to End-Users in the Marketing
Territory;
6. Present the End-User License Agreement provided by Distributor to all
prospective customers, obtain duly executed copies of the End-User
License Agreement from each End-User prior to delivery of the Compaq
software as part of any TCS Products, and forward one copy of each
End-User License Agreement to Compaq promptly after its signing;
7. Provide technical support for TCS Products to End-Users as set forth
in Section 7 hereof.
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5. CONFIDENTIALITY OF INFORMATION; PROTECTION AND SECURITY.
5.1 The Parties shall use all reasonable efforts to protect and defend
the proprietary nature of the Programs, including Enhancements and any
derivative works of the Programs. Except as expressly provided otherwise in
this Agreement, neither TCS nor Compaq shall copy, modify, transcribe, store,
translate, sell, lease, or otherwise transfer or distribute any of the
Programs, including Enhancements, in whole or in part, without prior
authorization in writing from the owning Party.
5.2 All Programs and Computer Equipment incorporated into products
shall be marked with such copyright, patent, or other notices; proprietary
legends; or restrictions as the owner of the Program may require.
5.3 Unless specifically covered by a separate, signed agreement, all
information provided to each other by the Parties shall be regarded as
confidential or proprietary, and will be governed by the Non-Disclosure
Agreement dated May 24, 1999 between the parties.
6. EXPENSES. It is expressly understood and agreed that neither Party is
under any obligation or requirement to reimburse the other Party for any
expenses or costs incurred in the performance of its responsibilities under
this Agreement. Any costs or expenses incurred by either Party shall be at its
sole risk and upon its independent business judgment that such costs and
expenses are appropriate.
7. TECHNICAL SUPPORT.
7.1 By Compaq:
7.1.a. Compaq shall provide assistance for development of
engineering configurations for standard joint product offerings under the terms
of the specific Computer Equipment developers packages. All such support shall
be performed at Compaq's facility unless another site is mutually agreed upon.
TCS shall pay all expenses of its own personnel, including travel, food, and
lodging, incident to such support.
7.1.b. Compaq shall provide both TCS and any TCS End-User(s) with
technical support, Maintenance Modifications, and Enhancements relating to the
Computer Equipment and Compaq Software in accordance with the terms of an
expected support agreement and payment of applicable fees.
7.2 By TCS:
TCS shall provide End-Users with all other necessary maintenance, training, and
support relating to TCS Products and TCS Software. Such services shall include,
without limitation, the following:
1. Technical training regarding installation and operation of the TCS
Products
2. Consulting support at End-User site(s) regarding proper utilization,
and optimization of use, of the TCS Products
3. Telephone hotline support during normal business hours
4. Maintenance and repair of Computer equipment
5. Distribution and application of Maintenance Modifications and
Enhancements.
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8. OWNERSHIP.
8.1 Compaq shall retain all intellectual property rights to Compaq
preexisting or independently developed intellectual property and all
intellectual property created during the term of this Agreement, except as
specifically granted to TCS hereunder. TCS agrees that it will not claim or
assert title to any such property or attempt to transfer any title to End-Users
or any third parties.
8.2 TCS shall retain all intellectual property rights to TCS
preexisting or independently developed intellectual property and all
intellectual property created during the term of this Agreement, except as
specifically granted to Compaq hereunder. Compaq agrees that it will not claim
or assert title to any such property or attempt to transfer any title to
End-Users or any third parties.
9. ORDER, DELIVERY, AND ADMINISTRATION
9.1 TCS shall place periodic orders for Computer Equipment during the
term of this Agreement through the Compaq Distributor and under the terms
established between TCS and the Distributor. Compaq's shipment of Computer
Equipment ordered by TCS shall be made to the Distributor consistent with
Compaq's available production volume and established shipping priorities and
agreements between Compaq and the Distributor.
10. PAYMENT
10.1 Payment for all Compaq Computer Equipment and/or Programs shall
be made according to the terms and conditions of agreement between TCS and the
Compaq Distributor.
11. LIMITED WARRANTIES
11.1 COMPAQ DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES AS TO THE SUITABILITY OR
MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY PRODUCTS OR
PROGRAMS FURNISHED HEREUNDER OR FOR ANY TCS PRODUCTS PREPARED BY TCS. IN NO
EVENT SHALL COMPAQ BE LIABLE FOR ANY LOST OR ANTICIPATED PROFITS, OR ANY
INCIDENTAL, EXEMPLARY, SPECIAL, OR CONSEQUENTIAL DAMAGES, REGARDLESS OF WHETHER
COMPAQ WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
11.2 TCS DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES AS TO THE SUITABILITY OR
MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY PROGRAMS FURNISHED
HEREUNDER OR FOR ANY COMPAQ PRODUCTS PREPARED BY COMPAQ. IN NO EVENT SHALL TCS
BE LIABLE FOR ANY LOST OR ANTICIPATED PROFITS, OR ANY INCIDENTAL, EXEMPLARY,
SPECIAL, OR CONSEQUENTIAL DAMAGES, REGARDLESS OF WHETHER TCS WAS ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.
11.3 No action arising or resulting from this Agreement, regardless of
its form, may be brought by either party more than three years after delivery
of the affected products or programs.
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12. TERMINATION
12.1 Should either Party commit a material breach of its obligations
hereunder, or should any of the representations of either Party in this
Agreement prove to be untrue in any material respect, the other Party may, at
its option, terminate this Agreement, by 30 days' written notice of
termination, which notice shall identify and describe the basis for such
termination. If, prior to expiration of such period, the defaulting Party cures
such default, termination shall not take place.
12.2 Either Party hereto may, at its option and without notice,
terminate this Agreement, effective immediately, should the other party hereto
(1) admit in writing its inability to pay its debts generally as they become
due; (2) make a general assignment for the benefit of creditors; (3) institute
proceedings to be adjudicated a voluntary bankrupt, or consent to the filing of
a petition of bankruptcy against it; (4) be adjudicated by a court of competent
jurisdiction as being bankrupt or insolvent; (5) seek reorganization under any
bankruptcy act, or consent to the filing of a petition seeking such
reorganization; or (6) have a decree entered against it by a court of competent
jurisdiction appointing a receiver, liquidator, trustee, or assignee in
bankruptcy or in insolvency covering all or substantially all of such party's
property or providing for the liquidation of such party's property or business
affairs.
12.3 Termination of this Agreement shall not relieve either party of
the obligations incurred hereunder pursuant to Sections 5, 8, 11, 12, 14, and
16 hereof, which Sections shall survive such termination.
13. LIMITATION OF REPRESENTATIONS AND USE OF NAME
13.1 Neither Party shall make any representations concerning the other
Party, the Computer Equipment, or any Programs, including any Maintenance
Modifications or Enhancements, except as set forth in the printed documentation
furnished to it by the other Party. Neither Party shall reproduce, reference,
distribute, or utilize any trade name or trademark of the other Party, except
(i) solely for purposes of identifying products and programs, or (2) as
required by law or regulatory authority, without the prior written approval of
the other Party.
13.2 Except as required by law or regulatory authority, each Party
shall submit to the other Party for approval, prior to use, distribution, or
disclosure, any advertising, promotion, or publicity in which the trade name or
trademarks of the other Party are used, or which is otherwise undertaken
pursuant to this Agreement. A Party shall have the right to require, at its
discretion, the correction or deletion of any misleading, false, or
objectionable material from any such advertising, promotion, or publicity.
14. INDEPENDENT CONTRACTOR STATUS. Each Party is an independent contractor
under this Agreement, and nothing herein shall be construed to create a
partnership, joint venture, or agency relationship between the Parties hereto
with the sole exception that the Parties act as a licensing agent of the other
Party with respect to Programs as provided herein. Neither Party shall have any
authority to enter into agreements of any kind on behalf of the other Party,
other than the presentation to customers of the End-User License Agreement with
respect to Programs, in strict accordance with the terms of this Agreement, and
shall have no further power or authority to bind or obligate the other Party in
any manner to any third party.
15. COMPLIANCE WITH LAW. Both Parties shall comply with all applicable
laws and regulations of governmental bodies or agencies in its performance
under this Agreement.
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16. DISPUTES. Any Party believing that a dispute, controversy or claim
relating to this Agreement (a "Dispute") has arisen between the Parties will
provide the other Party with a written statement of the nature of such Dispute.
16.1 Within three business days of such notice being given, the
Project Managers (or their designees) will meet and attempt to resolve the
Dispute through negotiation. If the Project Managers are unable to resolve the
Dispute within ten business days of the commencement of negotiations, each will
provide a written statement describing the nature of and his or her position
concerning the Dispute to Senior Managers within their respective
organizations, not later than the twelfth day following commencement of
negotiations.
16.2 Within five business days of the date the last of such statements
has been provided, the Senior Managers will meet and attempt to resolve the
Dispute through negotiation. If the Senior Managers are unable to resolve the
Dispute within ten business days of the commencement of their negotiations,
either Party may, upon written notice to the other Party, submit the Dispute to
mediation or arbitration in accordance with the following paragraph.
16.3 If the Dispute cannot be settled through negotiation as set forth
above, a Party may submit the Dispute to a sole mediator selected by the
Parties or, at the option of the Parties, to mediation by the American
Arbitration Association (AAA). If not thus resolved, the Dispute shall be
referred to a sole arbitrator selected by the parties within thirty days of the
mediation, or in the absence of such selection, to AAA arbitration which shall
be governed by the United States Arbitration Act. The award shall be made
within three months of selection of the arbitrator and may be entered in any
court having jurisdiction. The mediation and arbitration shall be held in
Washington, DC. The arbitrator shall determine issues of arbitrability but may
not limit, expand or otherwise modify the terms of the Agreement nor have
authority to award punitive or other damages in excess of compensatory damages
and each Party irrevocably waives any claim thereto. Each Party shall bear its
own expenses, but those related to the compensation of the mediator and
arbitrator shall be borne equally. The Parties, their representatives, other
participants and the mediator and arbitrator shall hold the existence, content
and result of mediation and arbitration in confidence.
17. 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, and
further agrees that it may not assign its rights or obligations under this
Agreement without the prior written consent of the other Party.
18. NOTICES. All notices and other communications required or permitted to
be given under this Agreement shall be in writing and shall be considered
effective when deposited in the U.S. mail as registered mail, return receipt
requested, postage prepaid, and addressed to the party at the address noted
above, unless by such notice a different address shall have been designated in
writing.
19. GOVERNING LAW. All questions concerning the validity, operation,
interpretation, and construction of this Agreement will be governed by and
determined in accordance with the laws of the State of Maryland, without giving
effect to its choice of laws provisions.
20. NO WAIVER. Neither 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 of any of the provisions of this Agreement. Further, the waiver
by either Party of a particular breach of this Agreement by the other Party
shall not be construed as, or constitute, a continuing waiver of such breach,
or of other breaches of the same or other provisions of this Agreement.
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21. FORCE MAJEURE. Neither Party shall be in default if failure to perform
any obligation hereunder is caused solely by supervening conditions beyond that
party's control, including acts of God, civil commotion, strikes, labor
disputes, and governmental demands or requirements.
22. SEVERABILITY. If any 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.
23. NO CONFLICT OF INTEREST. Each Party represents and warrants that it
has full power and authority to undertake the obligations set forth in this
Agreement and that it has not entered into any other agreements, nor will it
enter into any other agreements, that would render it incapable of
satisfactorily performing its obligations hereunder, or place it in a position
of conflict of interest, or be inconsistent or in conflict with its obligations
hereunder.
24. SCOPE OF AGREEMENT. Each of the Parties hereto acknowledges that it
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
state of agreement and supersedes all proposals (oral or written),
understandings, representations, conditions, warranties, covenants, and all
other communications between the Parties relating thereto. This Agreement may
be amended only by a writing that refers to this Agreement and is signed by
both Parties.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their authorized representatives as set forth below:
COMPAQ COMPUTER CORPORATION TELECOMMUNICATION SYSTEMS,INC.
By: /s/ Xxxxxxx Xxxxx By: /s/ Xxxxxxx X. Xxxxx
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Title: VP Global Business & Finance Title: Chief Operating Officer
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Date: May 30, 2000 Date: 6-5-00
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COMPAQ/TCS RESELLER AGREEMENT
EXHIBIT A
1. COMPUTER EQUIPMENT:
Compaq CN-Series Platform
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