EXHIBIT 10.9
SOFTLINK & FOUNTAIN
SOFTWARE DISTRIBUTION AND MARKETING RIGHTS AGREEMENT
----------------------------------------------------
This Agreement is by and between Softlink Inc., a Nevada Corporation, with
its principal office at 0000 Xxxxxxx Xxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxx Xxxxx,
XX 00000 (hereinafter referred to as "SOFTLINK"), FOUNTAIN TECHNOLOGIES, INC., a
New York corporation and its affiliated corporations with a principal place of
business at 00 Xxxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxxxx, 00000 (hereinafter referred
to as "FOUNTAIN").
SOFTLINK has developed the software product(s) described in the attached
Schedule A (the "Licensed Software"), a version or versions of which will be
----------
provided to FOUNTAIN for distribution under this Agreement. FOUNTAIN desires to
bundle the Licensed Software with computer hardware and/or computer services
provided by FOUNTAIN, all as described in Schedule A and to market FOUNTAIN'S
----------
products and/or services, together with the Licensed Software, to distributors,
resellers, and end users, subject to the provisions of this Agreement.
In consideration of the foregoing and the mutual promises set out in this
Agreement, the parties agree as follows:
1. Grant of License. SOFTLINK hereby grants to FOUNTAIN a nonexclusive
----------------
nontransferable right and license to market and distribute the Licensed Software
to its customers anywhere in the world, but only in connection with the sale of
hardware produced or marketed by FOUNTAIN or in connection with services
provided by FOUNTAIN related to configuring, integrating, or imaging computers
or computer systems. This license includes a nonexclusive right to make, sell,
and offer for sale copies of the Licensed Software, and a nonexclusive right and
license under applicable copyright laws to reproduce and distribute the Licensed
Software, subject to the terms of this Agreement.
2. License Terms to End Users. FOUNTAIN shall provide the Licensed
--------------------------
Software to its customers only under the terms of a license that includes
provisions that are legally sufficient to (i) notify the end user that the
Licensed Software is protected by copyright, (ii) notify the end user that the
Licensed Software is being licensed (not sold) and that ownership is not being
transferred, (iii) prohibit copying or transfer of the Licensed Software, (iv)
prohibit reverse programming, decompilation, and other reverse engineering of
the Licensed Software, (v) disclaim ALL WARRANTIES WITH RESPECT TO THE USE OF
THE LICENSED SOFTWARE, INCLUDING BUT NOT LIMITED TO ANY WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR WARRANTIES ARISING FROM
USAGE OF TRADE OR COURSE OF DEALING, and (vi) limit SOFTLINK's liability related
to the Licensed Software to license fees actually paid by FOUNTAIN for the
Licensed Software. If SOFTLINK so requests, FOUNTAIN shall distribute the
Licensed Software under the terms of SOFTLINK's standard license agreement to
end users.
3. Master Diskettes. SOFTLINK shall provide FOUNTAIN with golden master
----------------
diskettes or a golden master CD-ROM for the Licensed Software. FOUNTAIN may use
the master CD-ROM to duplicate the Licensed Software as necessary to provide the
Licensed Software to its customers, together with FOUNTAIN'S hardware or the
configuration of computer(s) or computer system(s) by FOUNTAIN for its
customers, all as contemplated by this Agreement. SOFTLINK shall not be
responsible for any materials provided to an end user other than the Licensed
Software.
4. Changes in Licensed Products and Software License Agreements. SOFTLINK
------------------------------------------------------------
shall have the right at any time and from time to time, in its sole discretion,
(i) to change the design, capabilities, or other characteristics of any Licensed
Software or discontinue the production or marketing of any Licensed Software
without prior notice of any kind, and (ii) to change the terms and conditions of
any of its standard software license to end users. SOFTLINK shall not have any
obligation to make upgrades or enhancements to the Licensed Software, but any
upgrades or enhancements that are provided to FOUNTAIN shall automatically be
deemed included as part of the Licensed Software. Upon making any changes to the
Licensed Software, SOFTLINK shall provide to FOUNTAIN a replacement golden
master CD-ROM, and FOUNTAIN shall thereafter license, market, and distribute
only the version of the Licensed Software contained on the replacement CD-ROM.
FOUNTAIN shall not modify, alter, reverse engineer, decompile, or disassemble
the Licensed Software or remove or alter any notices, legends or proprietary
markings that are placed upon or contained in the Licensed Software.
5. Royalties and Fees. In consideration of the rights granted to FOUNTAIN
------------------
under this Agreement, FOUNTAIN shall pay to SOFTLINK the royalties and fees set
out in Schedule B. Except as otherwise specified in Schedule B, all payments
---------- ----------
hereunder shall be made by FOUNTAIN within thirty (30) days after the date of
SOFTLINK's invoice, or, in the case of monthly or quarterly payments, within
thirty (30) days after the end of the applicable month or quarter. If any
royalties or fees are based upon the number of copies of Licensed Software
distributed by FOUNTAIN or upon revenues received by FOUNTAIN, accurate records
shall be kept by FOUNTAIN sufficient to show compliance with this Agreement, and
SOFTLINK or its representative shall have the right, at SOFTLINK's expense, to
examine such records from time to time during regular business hours for the
purpose of verifying the accuracy of payments due under this Agreement. If the
examination reveals an underpayment of five percent (5%) or more of amounts due
under this Agreement with respect to the period of time being examined, the
expenses of the examination shall be borne by FOUNTAIN.
6. Technical and Sales Support. SOFTLINK agrees to provide to FOUNTAIN a
---------------------------
level of telephone support to FOUNTAIN'S technical support staff that is
substantially equivalent to the support provided by SOFTLINK to OEMs generally.
7. Marketing Practices and Use of Trademarks. FOUNTAIN shall not take any
-----------------------------------------
action relating to the Licensed Software that reflects unfavorably on the
Licensed Software or upon SOFTLlNK's good name, goodwill, and reputation.
FOUNTAIN shall not make any representations or warranties regarding the Licensed
Software, except as authorized in writing by SOFTLINK. FOUNTAIN shall not have
the right to use any of SOFTLINK'S trademarks, trade names, service marks,
logos, or designations, except as specifically approved in writing by SOFTLINK.
8. Distributor Agreements. If FOUNTAIN distributes the Licensed Software
----------------------
through distributors, FOUNTAIN shall exercise its best efforts to ensure that
its distributors conduct their business in a manner that is consistent with the
terms of this Agreement and permits FOUNTAIN to comply with all of its
obligations hereunder.
9. Compliance with Laws. FOUNTAIN shall conduct its business in
--------------------
compliance with all applicable laws and regulations in any way related to the
Licensed Software or to the exercise of FOUNTAIN'S rights under this Agreement.
Without limiting the generality of the foregoing, FOUNTAIN shall not market or
distribute any Licensed Software in violation of any United States law relating
to the export or reexport of goods or technical information, including without
limitation, the Export Administration Act of 1979 as amended from time to time
and any regulations promulgated thereunder, or engage in any act that violates
the U.S. Foreign Corrupt Practices Act as amended from time to time or any
regulations promulgated thereunder.
10. Ownership of Intellectual Property. SOFTLINK represents that it has
----------------------------------
all rights and licenses necessary to grant the rights and licenses set out in
this Agreement. FOUNTAIN acknowledges that all intellectual property rights in
and relating to the Licensed Software, including but not limited to any patents,
copyrights, trade secrets, and trademarks, whether developed prior to or after
the date of this Agreement, are and shall remain the property of SOFTLINK or its
licensors.
11. Confidential Information. The parties acknowledge that during the term
------------------------
of this Agreement, each of them may receive from the other confidential
information, including any and all information and know-how related directly or
indirectly to the disclosing party, its business, or its products that is
conspicuously marked "CONFIDENTIAL", "PROPRIETARY", or with other words of
similar import, or that the receiving party knows is not publicly available. The
receiving party shall not use or disclose the confidential information except in
connection with, and as contemplated by, this Agreement. The receiving party
shall use at least the same degree of care to avoid disclosure or unauthorized
use of confidential information as it employs with respect to its own most
confidential and proprietary information, but at all times shall use at least
reasonable care. The receiving party shall not have any obligation of
confidentiality with respect to any information that (i) is already known to the
receiving party at the time the information is received from the disclosing
party, as proven by prior documents or records of the
receiving party; or (ii) is or becomes publicly known through no wrongful act of
the receiving party; or (iii) is rightfully received by the receiving party from
a third party without restriction.
12. Limited Warranty. SOFTLINK WARRANTS THAT THE LICENSED SOFTWARE
----------------
CONFORMS TO ANY WARRANTIES SET OUT IN SOFTLINK'S STANDARD END USER LICENSE FOR
THE LICENSED SOFTWARE. SUCH WARRANTIES ARE IN LIEU OF AND EXCLUDE ALL OTHER
WARRANTIES, WHETHER TO FOUNTAIN OR ANY CUSTOMER OF FOUNTAIN, WHETHER EXPRESS OR
IMPLIED, INCLUDING BUT NOT LIMITED TO ANY WARRANTIES OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE.
13. Limitation of Liability. IN NO EVENT SHALL SOFTLINK'S LIABILITY
-----------------------
RELATED TO ANY LICENSED SOFTWARE EXCEED THE ROYALTIES ACTUALLY PAID HEREUNDER
DURING THE TWELVE (12) MONTHS IMMEDIATELY PRECEDING THE DATE SOFTLINK IS
NOTIFIED OF THE CLAIM GIVING RISE TO THE LIABILITY. FOUNTAIN SHALL NOT BE LIABLE
UNDER ANY CIRCUMSTANCES TO FOUNTAIN OR ANY OTHER PERSON FOR CONSEQUENTIAL,
INDIRECT, SPECIAL, OR INCIDENTAL DAMAGES ARISING FROM OR IN CONNECTION WITH THE
HANDLING OR USE OF LICENSED SOFTWARE OR ARISING FROM OR IN CONNECTION WITH ANY
ACTS OR OMISSIONS OF SOFTLINK RELATED TO THE LICENSED SOFTWARE.
14. Indemnification by SOFTLINK. SOFTLINK shall defend any action brought
---------------------------
against FOUNTAIN based on an allegation that any Licensed Software infringes a
United States or foreign patent, copyright, or trade secret, and SOFTLINK shall
pay all costs and damages made in settlement or awarded as a result of any such
action. If a final injunction shall be obtained in any such action restraining
use of the Licensed Software by any customer of FOUNTAIN, or if SOFTLINK
believes that any Licensed Software is likely to become the subject of a claim
of infringement, SOFTLINK shall, at its option and at its expense, (i) procure
for FOUNTAIN'S customer the right to continue using the Licensed Software, (ii)
replace or modify the Licensed Software so that it becomes non-infringing or
(iii) refund to FOUNTAIN the royalties paid by FOUNTAIN under this Agreement
during the immediately preceding twelve (12) months, whereupon FOUNTAIN shall
promptly cease using the Software. Notwithstanding the foregoing, SOFTLINK shall
have no obligation with respect to any action brought against FOUNTAIN based on
an allegation of patent, copyright, or trade secret infringement unless SOFTLINK
is promptly notified by FOUNTAIN in writing of such action and is allowed
complete control of the defense of such action and all negotiations for its
settlement or compromise. These provisions state SOFTLINK's entire liability
with respect to infringement of patents, copyrights, or trade secrets.
15. Indemnification by FOUNTAIN. FOUNTAIN shall defend, indemnify, and
---------------------------
hold harmless SOFTLINK from and against any and all claims, liabilities,
damages, costs, and
expenses (including reasonable legal fees) suffered incurred, or asserted
against SOFTLINK arising out of or related to alleged losses or damages
(including but not limited to any loss of business profits, business
interruption, or loss of business information) suffered or incurred by any third
party in connection with the use of FOUNTAIN'S products or suffered or incurred
by a third party as a result of any breach of this Agreement by FOUNTAIN.
16. Term of Agreement. The initial term of this Agreement, and FOUNTAIN'S
-----------------
nonexclusive license hereunder, shall continue in force for a period of one
year, unless it is terminated earlier as provided herein. Upon expiration of the
initial term, this Agreement shall automatically renew for successive one year
terms unless either party notifies the other in writing of its intent to
discontinue this Agreement at least forty-five (45) days prior to the expiration
of the then-current term.
17. Termination at Either Party's Option. Either party may terminate this
------------------------------------
Agreement prior to its expiration, as follows:
1. If the other party materially fails to perform its obligations under
this Agreement or takes any action that violates the terms of this
Agreement, the non-breaching party may terminate this Agreement, effective
thirty (30) days after the date written notice is sent by the non-breaching
party specifying the nature of the other party's breach and stating that
the Agreement will terminate if the breach is not cured. If the breach is
not cured during the cure period, this Agreement shall terminate upon
expiration thereof.
1. Notwithstanding the provisions of subparagraph (a), above, the
terminating party may specify a shorter cure period for any breach
(including no cure period in appropriate circumstances), and may terminate
this Agreement immediately upon the expiration of the shorter cure period,
to the extent reasonably necessary to avoid irreparable injury to the non-
breaching party.
18. Liability Upon Termination. SOFTLINK shall have no liability to
--------------------------
FOUNTAIN by reason of the expiration or termination of this Agreement for
compensation, reimbursement, or damages of any kind, including but not limited
to any loss of prospective profits on anticipated sales, loss of goodwill, or
investments made in reliance on this Agreement. Each party acknowledges that it
has received no assurances from the other that their business relationship under
this Agreement will continue beyond the term established herein.
19. Return of Materials: Sale of Inventory. Promptly upon the expiration
--------------------------------------
or termination of this Agreement, FOUNTAIN shall return to Softlink the golden
master diskettes or golden master CD-ROM and all other materials in FOUNTAIN'S
possession or
control that belong to SOFTLINK. If this Agreement is terminated for any reason
other than breach by FOUNTAIN, FOUNTAIN shall have the right to distribute,
together with FOUNTAIN products and subject to all of the terms of this
Agreement, its inventory of Licensed Software existing as of the date of
termination, provided that the quantity of such inventory does not exceed the
average inventory held by FOUNTAIN over the immediately preceding twelve (12)
months.
20. Notices. All notices, demands, or other communications under this
-------
Agreement shall be in writing and shall be deemed given if served personally or
sent by fax, overnight courier, or certified mail, postage prepaid, and
addressed as follows:
If to SOFTLINK: Copy to:
Xxxxx Prior Xxxxxxx Xxxx
Vice President Sales President
Softlink Inc. Softlink Inc.
2041 Mission College Blvd., Suite 2041 Mission College Blvd., Suite
156 172
Santa Clara, CA 95054 Xxxxx Xxxxx, XX 00000
Phone: 000-000-0000 Phone: 000-000-0000
Fax: 000-000-0000 Fax: 000-000-0000
Email: xxxxxx@xxXxxxxx.xxx Email: xxxxx@xxXxxxxx.xxx
With a copy to OEMCentral:
Xxxxx Xxxxxx
President
OEMCentral
00 Xxxxxxx Xxxxxx
Xxxx Xxxxxx, Xxxxxxxxxx 00000-0000
Phone: 000-000-0000
Fax: 000-000-0000
Email: xxxxx@xxxxxxxxxx.xxx
If to FOUNTAIN: With a copy to:
Xxxxx Xxxxxx Office of the Controller
VP Business Affairs Accounting Department
Fountain Technologies Fountain Technologies, Inc.
0 Xxxxxx Xxxx Xxxx 50 Xxxxxxxx Road
Armonk, NY 10405 Xxxxxxxx, XX 00000
Phone: 000-000-0000 1
Fax: 000-000-0000
Email: xxxxxxx@xxx.xxx
---------------
Notices shall be deemed given when received if hand delivered or sent by
confirmed fax, the next business day after being sent by overnight courier, or
four calendar days after being sent by certified mail. Either party may
designate by notice, given as specified above, a new address to which notices,
demands, or other communications may be sent.
21. Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties pertaining to its subject matter, and it supersedes any and
all written or oral agreements previously existing between the parties with
respect to such subject matter. No supplement, modification, or amendment of
this Agreement shall be binding unless executed in writing by both parties.
22. Waiver. Either party's failure to insist on strict performance of any
------
provision of this Agreement shall not be deemed a waiver of any of its rights or
remedies, nor shall it relieve the other party from performing any subsequent
obligation strictly in accordance with the terms of this Agreement. No waiver
shall be effective unless it is in writing and signed by the party against whom
enforcement is sought.
23. Assignment. This Agreement may not be assigned by either party without
----------
the prior written consent of the other. Any attempted assignment in violation of
this provision shall be void and shall be deemed a breach of this Agreement.
24. Choice of Law. This Agreement shall be governed by and construed in
-------------
accordance with California law, without regard to its rules regarding conflicts
of law.
25. Arbitration. Any controversy or claim arising out of or relating to
-----------
this Agreement, or the breach of this Agreement, shall be settled by arbitration
in accordance with the Commercial Arbitration Rules of the American Arbitration
Association. The place of arbitration shall be San Jose, California, and
judgment upon the award of the arbitrator (or arbitrators) may be entered in any
court having jurisdiction.
In witness of the foregoing, the parties have signed this Agreement on the
dates indicated below. This Agreement shall be deemed effective on the date it
is signed by SOFTLINK.
Softlink Inc. FOUNTAIN
By: /s/ Xxxxx A Prior By: /s/ Xxxxx Xxxxxx
(Corporate Officer) (Corporate Officer)
Name: Xxxxx A Prior Name: Xxxxx Xxxxxx
Title: VP of Sales Title: V.P. Corporate Affairs
Date: 7/1/99 Date: 6/29/99
SCHEDULE A
Description of Licensed Software and FOUNTAIN Products
------------------------------------------------------
Licensed Software: email VoiceLINK
FOUNTAIN Products: Any and all FOUNTAIN computer system products that FOUNTAIN
may choose at its sole discretion.
SCHEDULE B
DESCRIPTION OF FEES
-------------------
FOUNTAIN shall pay SOFTLINK a one-time license fee of fifty thousand dollars
($50,000.00) for the unlimited use of the Licensed Software for a period of
twelve (12) months from the date of first shipment of the licensed software with
FOUNTAIN'S products, not to exceed 300,000 units
Revenue Sharing on Upgrades:
1. SOFTLINK shall share $5.00 upgrade revenues with FOUNTAIN for FOUNTAIN
customers who upgrade to another SOFTLINK product.
2. SOFTLINK will handle all fulfillment and track revenue share credit back to
FOUNTAIN through a special code that identifies FOUNTAIN customers purchasing
upgrade products.
3. As incentive to and to insure that end-users use their special code which
identifies them as FOUNTAIN customers, the price to FOUNTAIN customers shall
always be at least $5.00 less than the price direct from SOFTLINK
4. SOFTLINK shall submit revenue share reports quarterly with payment from
SOFTLINK to FOUNTAIN within forty-five (45) days after the end of each
calendar quarter for the previous calendar quarter.
5. FOUNTAIN shall provide reports within forty-five (45) days after the end of
each calendar quarter for the previous calendar quarters for the number of
FOUNTAIN computer system products that have been shipped with SOFTLINKS
Licensed Software to the recipients listed in Section 20 of this Agreement.
SCHEDULE C
Invoices to be sent to: Revenue share payments and reports sent
to:
Xxxx Xxxxx
Senior Accountant Xxxx Xxxxx
Fountain Technologies Inc. Senior Accountant
00 Xxxxxxxx Xxxx Fountain Technologies Inc.
Xxxxxxxx, XX 00000 00 Xxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Phone: 000-000-0000 Ex: 1375
Fax: 000-000-0000 Phone: 000-000-0000 Ex: 1375
Email: xxxxxx00@xxX.xxx Fax: 000-000-0000
---------------- Email: xxxxxx00@xxx.xxx
----------------
Royalty payments and reports sent to: With copies of Royalty Reports sent to;
Xxxxx Prior Xxxxx Xxxxxx
Vice President Sales
Softlink Inc. OEMCentral
0000 Xxxxxxx Xxxxxxx Xxxx., Xxxxx 00 Sunrise Avenue
259 Mill Valley, CA 94941-3339
Xxxxx Xxxxx, XX 00000 Phone: 000-000-0000
FAX: 000-000-0000
Phone: 000-000-0000 Email: xxxxx@xxxxxxxxxx.xxx
Fax: 000-000-0000 --------------------
Email: xxxxxx@xxXxxxxx.xxx
SCHEDULE D
1. Single Point of Contact. While FOUNTAIN has the responsibility to provide
technical support to all end users, FOUNTAIN agrees to identify a single
person to act as the support liaison between FOUNTAIN and SOFTLINK.
FOUNTAIN agrees to provide the name, phone, address, and email information
for this person. SOFTLINK will permit a backup contact, as well.
2. Software/Equipment/Documentation Exchange. FOUNTAIN agrees to provide on an
"as required basis" any equipment, software licenses, and documentation
required to support FOUNTAIN'S shipping product as a means to duplicate and
solve end-user problems.
3. FOUNTAIN agrees to cooperate in a press release concerning this arrangement
upon signing of this Agreement. Email VoiceLINK will be included in all
marketing efforts promoted by FOUNTAIN in conjunction with it's offering of
software bundles.
