EXHIBIT G
REFERRAL AND SERVICE AGREEMENT
THIS SERVICE AND REFERRAL AGREEMENT (this "Agreement"), is dated as of
the 1st day of October, 1999, by and between INFRASTRUCTURE DEFENSE, INC., a
Delaware corporation (the "Company"), and HOMECOM COMMUNICATIONS, INC., a
Delaware corporation ("HomeCom"). Capitalized terms used but not defined herein
shall have the respective meanings ascribed to such terms in the Asset Purchase
Agreement dated of even date herewith by and between the Company and HomeCom
(the "Asset Purchase Agreement").
WHEREAS, pursuant to the terms of the Asset Purchase Agreement, HomeCom
will sell to the Company all of the business and assets of HomeCom's internet
security division (the "Division");
WHEREAS, the Company and HomeCom have agreed (i) that HomeCom will be
entitled to receive a referral fee in connection with HomeCom's referral of
customers and clients (other than existing customers and clients of the
Division) as set forth herein, and (ii) the Company has agreed to provide
certain services to HomeCom in accordance with this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth in this Agreement, and for good and other valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and
HomeCom agree as follows:
1. INTERNAL SECURITY AUDITS. The Company agrees to provide HomeCom with
annual internal security audits of HomeCom's information technology systems and
networks at no cost for 10 years in accordance with reasonable commercial
standards, limited to current corporate headquarters operations of HomeCom in
its current state of configuration (except for changes to the location of
corporate headquarters or the state of configuration which do not increase the
burden or cost to the Company of providing such audits) and, in any event, not
exceeding $40,000 worth of audit service value in any year, as determined in
good faith by the Company using industry standards to the extent readily
obtainable; provided, however, that the Company reserves the right to substitute
an audit procedure of equal or better value or, with the consent of HomeCom
(which consent shall not be unreasonably withheld), to subcontract the audit out
to a third-party or affiliated qualified vendor. The foregoing sentence
notwithstanding, the Company shall not be obligated to provide audit services
(i) until HomeCom has satisfied all material covenants and agreements contained
in the Asset Purchase Agreement, and (ii) if HomeCom is then in breach of any
material representation or warranty contained in the Asset Purchase Agreement.
The timing of such audits shall be within the reasonable discretion of the
Company. If HomeCom wishes to engage the Company to install software or
otherwise implement any recommendations resulting from the Company's annual
audit, such services will be provided for additional charges agreed to by the
parties at the time of such engagement.
2. REFERRAL FEE. HomeCom will be entitled to receive a referral fee for
referrals by HomeCom to the Company of customers who purchase the Company's
iALERT Reports (or such other products and services as may be specified by
mutual agreement of the parties from time to time), based upon a two-tier fee
structure, as follows: (A) for the referral, including name, telephone number
and other basic contact information, by HomeCom of a person or entity desiring
to purchase iALERT
Reports who, within 180 days after such referral, purchases iALERT Reports from
the Company, HomeCom will be entitled to receive a referral fee equal to 5% of
subscription payments actually received by the Company (less discounts, rebates,
returns and other deductions) from such referred customer during the first year
of service by the Company to such referred customer, or (B) for the referral by
HomeCom of a current customer or customer of a current customer, provided that
virtually all of the preliminary marketing development work has been done by
HomeCom and the Company merely participates in the closing of the deal and
provision of the iALERT Reports, HomeCom will be entitled to receive a referral
fee (in lieu of and not in addition to the referral fee described in clause (A)
above) equal to 20% of subscription payments actually received by the Company
(less discounts, rebates, returns and other deductions) from such referred
customer for so long as such referred customer continues to subscribe to iALERT
Reports; PROVIDED, HOWEVER, that HomeCom shall not be entitled to any referral
fee or other payment with respect to any person or entity who is an existing
client or customer of the Division or who purchased products or services from
the Division within three years of the date hereof, it being understood that the
Purchase Price paid pursuant to the Asset Purchase Agreement includes payment in
respect of the Division's customer and client list. The determination of which
level of commission is payable to HomeCom in any particular instance will be
determined by the Company in an exercise of its good faith judgment.
3. HOMECOM OBLIGATIONS.
3.1 ACCESS TO INFORMATION AND PERSONNEL. HomeCom shall provide
the Company with details concerning its systems, network and software,
information concerning unauthorized intrusions into its systems, network and
software and access to knowledgeable HomeCom personnel to respond to questions
and otherwise to assist the Company in performing its audit services hereunder.
HomeCom agrees that the Company may include such details in its database, but
shall not reuse or republish such matters in any manner that identifies HomeCom
as the source of or otherwise associated with such data.
3.2 IMPLEMENTATION OF RECOMMENDATIONS. HomeCom shall be solely
responsible for determining whether and how to implement any recommendations
resulting from the Company's audit. HomeCom acknowledges and agrees that the
Company shall have no liability for HomeCom's failure to implement one or more
of the recommendations; any complications, incompatibilities, costs, or other
problems with the systems or networks which directly or indirectly arise from
the implementation of any recommendation; or any inadequacy or failure of any
implemented recommendations to avert, detect or prevent security breaches,
losses, intrusions or other occurrences or the consequences thereof.
4. DISCLAIMER OF WARRANTIES. ALL ASPECTS OF THE AUDIT SERVICES PROVIDED
BY THE COMPANY UNDER THIS AGREEMENT ARE PROVIDED ON AN "AS IS" BASIS WITHOUT
WARRANTY OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO
ANY WARRANTIES OF TITLE OR NON-INFRINGEMENT OR THE IMPLIED WARRANTIES OR
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. IN PARTICULAR, THE COMPANY
MAKES NO REPRESENTATIONS OR WARRANTIES (I) CONCERNING THE ACCURACY,
COMPLETENESS, OR RELIABILITY OF ANY SERVICES, REPORTS, RECOMMENDATIONS, OR
INFORMATION PROVIDED UNDER THIS AGREEMENT, OR (II) THAT THE CONTENT OF SUCH
SERVICES, REPORTS, RECOMMENDATIONS, OR INFORMATION ARE APPROPRIATE, AUTHORIZED,
OR LAWFUL IN ALL COUNTRIES, STATES, OR OTHER JURISDICTIONS; OR (III) THAT THE
SERVICES
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AND/OR RECOMMENDATIONS PROVIDED WILL AVERT, DETECT OR PREVENT SECURITY BREACHES,
LOSSES, INTRUSIONS OR OTHER OCCURRENCES AND/OR THE CONSEQUENCES THEREFROM THAT
THE SERVICES AND/OR RECOMMENDATIONS ARE DESIGNED OR INTENDED TO AVERT, DETECT OR
PREVENT OR (IV) THAT ANY ELECTRONIC FILES OR TRANSMISSIONS PROVIDED BY THE
COMPANY WILL BE FREE FROM ERRORS, VIRUSES OR OTHER HARMFUL ELEMENTS; OR (V)
CONCERNING THE RESULTS WHICH WILL BE OBTAINED FROM THE USE OF SUCH SERVICES,
REPORTS, RECOMMENDATIONS OR INFORMATION.
5. LIMITATION ON LIABILITY AND DAMAGES. IN NO EVENT SHALL THE COMPANY
OR ANY OF ITS AFFILIATES, EMPLOYEES, AGENTS, OR THIRD PARTY CONTENT PROVIDERS BE
LIABLE FOR ANY SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES OF ANY
KIND (INCLUDING BUT NOT LIMITED TO LOST PROFITS, LOST OPPORTUNITIES, IMPAIRED
REPUTATION, LOST SOFTWARE OR DATA, FAILURE TO REALIZE EXPECTED SAVINGS OR
INVESTMENT LOSSES) ARISING OUT OF OR IN CONNECTION WITH THE ANNUAL AUDIT OR
OTHER SERVICES PROVIDED UNDER THIS AGREEMENT WHETHER ARISING IN CONTRACT, TORT
OR OTHERWISE, AND WHETHER OR NOT THE COMPANY WAS ADVISED OF THE POSSIBILITY OF
SUCH DAMAGE. IF THE COMPANY SHOULD BE FOUND LIABLE FOR ANY LIABILITY, DAMAGE,
LOSS, COST AND EXPENSE, THE MAXIMUM AGGREGATE LIABILITY OF THE COMPANY OR ANY OF
ITS AFFILIATES, EMPLOYEES, AGENTS, OR THIRD PARTY CONTENT PROVIDERS SHALL BE
STRICTLY LIMITED TO $40,000. THIS AGGREGATE LIMITATION SHALL APPLY EVEN IF SUCH
LIABILITY, DAMAGE, LOSS, COST AND EXPENSE ARE DUE DIRECTLY OR INDIRECTLY TO (I)
THE FAILURE OR INADEQUACY OF THE AUDIT, RECOMMENDATIONS OR OTHER SERVICES TO
AVERT, DETECT OR PREVENT SECURITY BREACHES, LOSSES, INTRUSIONS OR OTHER
OCCURRENCES AND/OR THE CONSEQUENCES THEREFROM, (II) THE COMPANY'S BREACH OF
CONTRACT OR WARRANTY, (III) THE COMPANY'S NEGLIGENCE (ACTIVE, PASSIVE OR
OTHERWISE), STRICT LIABILITY, VIOLATION OF ANY APPLICABLE LAW, AND/OR ANY OTHER
ALLEGED FAILURE ON THE PART OF COMPANY, ITS AGENTS AND/OR EMPLOYEES,
IRRESPECTIVE OF CAUSE OR ORIGIN; AND/OR (IV) ANY OTHER CAUSE OR REASON.
6. SOLE AND EXCLUSIVE REMEDY. HOMECOM'S EXCLUSIVE REMEDIES WITH RESPECT
TO ANY AND ALL LIABILITIES, LOSSES, COSTS OR DAMAGES RESULTING FROM ANY CAUSE
WHATSOEVER, INCLUDING BUT NOT LIMITED TO THE COMPANY'S BREACH OF CONTRACT OR
NEGLIGENCE, SHALL BE TO RECEIVE AN AMOUNT EQUAL TO THE ACTUAL DAMAGES SUFFERED
BY HOMECOM DIRECTLY CAUSED BY THE COMPANY (SUBJECT TO THE MAXIMUM LIMITATION SET
FORTH IN SECTION 5) AND TO REQUIRE THE COMPANY TO REPERFORM THE AUDIT SERVICES.
7. LIABILITY FOR LOST DATA. The Company shall not be responsible for
the repair of damage to or the replacement or restoration of, any software or
data files resulting from accident, transportation, neglect or misuse;
intentional acts by persons or entities other than the Company, failure of
electrical power, air conditioning or humidity control, or other causes beyond
its control. HomeCom shall be responsible for regularly backing up all software
and data on HomeCom's systems and network. If any act or omission of the Company
directly causes any loss or damage to HomeCom's software or data, the
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Company's sole obligation and HomeCom's sole remedy shall be the Company's
provision of reasonable assistance to restore the lost software and data from
the most recent backup copy maintained by HomeCom. The Company shall have no
obligation with respect to lost software or data under any other circumstances
or to recover, restore or re-enter any other software, data, information or
records.
8. FORCE MAJEURE. The Company shall be excused from fulfilling its
contractual obligations hereunder if it is prevented or delayed in such
performance by force majeure conditions beyond its reasonable control including,
but not limited to, fire or explosions; lockouts; strikes; labor shortages or
disturbances; acts of God, including, but not limited to, floods, hurricanes,
tornadoes, earthquakes, unusually severe weather, and natural disasters; war;
insurrection; derailment that causes the normal route of movement to be
impassable or other casualty; acts of the public enemy; acts of governmental
authority; embargo; quarantine; and acts or omissions of third parties. The
Company will as soon as practicable notify HomeCom of the existence of a force
majeure condition and will use commercially reasonable efforts to continue to
perform its obligations to the extent practicable and to recommence performing
all obligations as soon as possible after the force majeure condition has ended.
9. SEVERABILITY. HomeCom and the Company agree and acknowledge that the
provisions of this Agreement shall be devisable and separate, so that, if any
provision or provisions of this Agreement are held to be unreasonable, unlawful,
or unenforceable, such holdings shall not impair or render invalid the remaining
provisions of this Agreement. If any provision hereof is held to be too broad or
unreasonable in duration, scope or character of restriction to be enforced, such
provisions shall be modified to the extent necessary so that any provision or
portion hereof shall be legally enforceable to the fullest extent permitted by
law, and the parties hereto expressly authorize any Court of competent
jurisdiction to enforce any such provision or portion hereof so that any and all
provisions or portions hereof shall be enforced by such Court to the fullest
extent permitted by law.
10. MODIFICATIONS AND AMENDMENTS. The terms and provisions of this
Agreement may not be modified or amended except with the written consent of the
Company and HomeCom. None of the terms and provisions of this Agreement may be
waived except in writing by the person so waiving.
11. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the domestic laws of the Commonwealth of Virginia, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the Commonwealth of Virginia or any other jurisdiction) that would cause the
application of the laws of any other jurisdiction other than the Commonwealth of
Virginia.
12. NOTICE. All notices and other communications required or permitted
to be given in respect of this Agreement shall be sent by personal delivery,
nationally recognized overnight courier, facsimile or certified or registered
mail, to the following parties at the following addresses, or, in each case, at
such other address or addresses as any party shall hereafter specify by written
notice to the others:
(i) If to the Company, to:
Infrastructure Defense, Inc.
0000 Xxxxxxxxx Xxxx
Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
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Attention: Xxxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
With a copy to:
McGuire, Woods, Battle &
Xxxxxx LLP
0000 Xxxxxx Xxxxxxxxx
Xxxxx 0000
XxXxxx, Xxxxxxxx 00000
Attention: Clive X. X.
X'Xxxxx, Esquire
Facsimile: (000) 000-0000
(ii) If to HomeCom, to:
HomeCom Communications, Inc.
Xxxxxxxx 00, Xxxxx 000
3535 Piedmont Road
Atlanta, Georgia
Attention: Xxxxxx Xxx
Facsimile: (000) 000-0000
With a copy to:
Xxxxx Xxxx
Sims, Moss, Xxxxx & Xxxxx LLP
000 Xxxxxxxxx Xxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
All such notices, requests and other communications will (i) if delivered
personally to the address as provided in this Section, be deemed given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number as
provided for in this Section, be deemed given upon receipt, (iii) if delivered
by mail in the manner described above to the address as provided in this
Section, be deemed given on the earlier of the fourth business day following
mailing or upon receipt and (iv) if delivered by overnight courier to the
address as provided for in this Section, be deemed given on the earlier of the
first business day following the date sent by such overnight courier or upon
receipt (in each case regardless of whether such notice, request or other
communication is received by any other person to whom a copy of such notice is
to be delivered pursuant to this Section). Any party from time to time may
change its address, facsimile number or other information for the purpose of
notices to that party by giving notice specifying such change to the other
parties hereto.
13. ASSIGNMENT. The Company has entered into this Agreement in reliance
on the information provided by HomeCom and in reliance on its current structure
and information systems. This Agreement may not be assigned or transferred by
HomeCom in any manner, by operation of law or otherwise, without the prior
written consent of the Company, which consent may not be unreasonably
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withheld unless such assignment would increase the burden or costs to the
Company, in which case such consent may be withheld in the Company's sole and
absolute discretion.
14. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
15. CUMULATIVE REMEDIES. All rights and remedies conferred under this
Agreement or by any other instrument or law shall be cumulative and may be
exercised singularly or concurrently.
16. HEADINGS. The headings of the paragraphs of this Agreement are
inserted for convenience only and shall not be deemed to constitute a part
hereof.
17. SURVIVAL. The provisions of Sections 4, 5, 6, 7 and this Section 17
and any other provisions which by its nature is intended to survive shall
survive any termination or expiration of this Agreement.
18. ALLOCATION OF RISK. This Agreement in general and the limitations
of liabilities and disclaimer of warranties set forth in Sections 5, 6 and 7 in
particular represent a mutually agreed upon allocation of risk and the
consideration provided for in this Agreement and the Asset Purchase Agreement
has been calculated to reflect such allocation of risk.
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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
duly executed by their authorized officers as of the day and year first above
written. This Agreement may be executed in counterparts, each of which shall be
deemed an original and all of which together shall constitute but one Agreement.
WITNESS: INFRASTRUCTURE DEFENSE, INC., a
Delaware corporation
By
----------------------------- ---------------------------------
Name: Name: Xxxxxxx X. Xxxxxx
Title: Vice President and
Chief Financial Officer
HOMECOM COMMUNICATIONS, INC. a
Delaware corporation
By
----------------------------- ----------------------------
Name: Name:
Title:
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