Exhibit 6(f)
MEMORANDUM OF UNDERSTANDING
This Agreement made this ______ day of May, 1998
Between:
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NETSentry Technology Inc. of Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx (hereinafter
referred to as "NTI")
And:
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Hewlett Packard Network System Test Division of Colorado Springs, Colorado, USA
(hereinafter referred to as "NSTD")
Whereas:
NSTD is interested in marketing and distributing NTI's ProbeNET software product
to specific customers on an exclusive basis; and
NTI plans on delivering ProbeNET, as specified in Section 8 of NTI's business
plan, by the second quarter of calendar year 1999; and
NTI is interested in developing other distribution channels for customers not
targeted by NSTD; and
Both parties are interested in a long term relationship whereby NTI becomes an
integral part of NSTD's business strategy; and
Both parties are committed to ensuring ProbeNET (for its designed purpose and
functionality) becomes the preferred product of Internet Service Providers for
testing their Internet Protocol networks; and
Both parties are committed to ensuring ProbeNET customers receive a high level
of service and support.
NOW THEREFORE THIS AGREEMENT WITNESSETH THAT, IN CONSIDERATION OF THE MUTUAL
PROMISES HEREINAFTER SET FORTH, THE PARTIES AGREE AS FOLLOWS:
o Based on NSTD's forecasted marketing, selling and distribution cost
structure, NTI will provide NSTD with a **% discount off the Net Selling
Price of ProbeNET. The Net Selling Price is the price paid to Hewlett
Packard by end user customers. When more precise estimates of NSTD's cost
structure are available, the exact discount will be finalized.
o NTI will be responsible for the software development and ongoing software
maintenance of ProbeNET. NTI agrees to ensure ProbeNET is Year 2000
compliant in accordance with the guidelines provided by NSTD.
o ProbeNET will be identified as both an HP and NTI product.
o NTI is committed to providing a high level of customer satisfaction and
will endeavor to deliver a high quality product. NTI plans to resolve minor
bug fixes with semi-annual software updates. Major bug fixes, should they
occur, will be remedied in the shortest time possible after discovery.
o Both parties agree to cooperate to ensure ProbeNET's user interface, where
practical and appropriate, is compatible with other NSTD products.
o NTI will endeavor to differentiate ProbeNET from network monitoring
products developed by HP's NMX division by focusing on "active
intervention" capabilities.
** - Confidential Treatment Requested
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o If NTI develops resource constraints, rather than delay the introduction of
ProbeNET, functionality may be reduced in accordance with customer and NSTD
priorities.
o NTI agrees to allow NSTD to have a representative on NTI's Product Strategy
Committee and NSTD agrees to allow NTI to have a representative participate
in the HP/NSTD Service Providers Business Team Strategy and Planning
Sessions.
o In the event, HP/NSTD becomes an equity investor in NTI, NTI agrees to
allow NSTD have 1 representative on NTI's Board of Directors.
o NTI will be responsible for training NSTD marketing, sales and support
personnel and for assisting NSTD in training the Hewlett Packard sales
organization.
o NSTD and the Hewlett Packard sales organization will be responsible for
marketing and selling ProbeNET to customers noted on the attached Schedule
"A". Marketing includes advertising, and promotion at marketing events
(trade shows, customer seminars, industry symposiums etc.). NTI will be
responsible for marketing and selling ProbeNET to small ISPs (as per the
definition noted in NETSentry's business plan) unless NSTD develops an
acceptable strategy for selling to the small ISP market segment.
o NSTD and the Hewlett Packard sales organization will have primary
responsibility for providing installation assistance and training for end
user customers.
o Product customization for end user customers will be handled on a
case-by-case basis, however, where appropriate, NSTD and the HP sales
organization will provide this capability.
o NSTD and the Hewlett Packard sales organization will be responsible for
establishing the end user price with the objective of maximizing revenue.
Potentially, the end user price could vary on a country-by-country basis.
o NTI will be responsible for assisting NSTD, when required, at marketing
events.
o NTI will be responsible for providing NSTD with demo software.
o NSTD will be responsible for developing marketing materials (brochures,
promotional material) for ProbeNET. NTI will be responsible for assisting
NSTD by providing technical specifications and other necessary
documentation in electronic format.
The term of this agreement will cover a period of 24 months, beginning with
ProbeNET's product release date. Thereafter it can be renewed annually providing
both parties are in agreement. During the term of this agreement NSTD agrees not
to develop or market any products that compete directly with ProbeNET; if NSTD
violates this agreement, NTI has the right to terminate the agreement with 30
days notice. Otherwise, should either party be dissatisfied with the performance
of the other party during the term of this agreement, they are required to
notify the other party in writing. Should the other party fail to remedy the
noted deficiencies within a reasonable period of time, the dissatisfied party
may terminate the agreement with 6 months notice.
This Agreement shall be construed in accordance with and governed by the laws of
the Province of British Columbia.
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the date
first above mentioned.
NETSentry Technology Inc. Hewlett Packard Network System Test Division
Per:_________________________ Per:_________________________
Title:________________________ Title:_________________________
Per:_________________________ Per:_________________________
Title:________________________ Title:_________________________
Date:________________________ Date:________________________
SCHEDULE "A"
NSTD will have exclusive worldwide marketing and distribution rights for the
following customers:
o Large and mid-size ISPs ( as per the definition used in NETSentry's
business plan); and
o Telephone companies; and
o Private network operators (intranets);
o Network Equipment Manufacturers.
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