EXHIBIT 10.15
GLOBAL TRADE SERVICES AGREEMENT*
BY AND BETWEEN
FORD MOTOR COMPANY
AND
VASTERA SOLUTION SERVICES CORPORATION
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* Portions of this document have been omitted, with the precise position of
these omissions marked with an asterisk, pursuant to a request for confidential
treatment and such omitted portions have been filed separately with the U.S.
Securities and Exchange Commission.
TABLE OF CONTENTS
1. DEFINITIONS................................................... 1
2. RELATIONSHIP OF PARTIES....................................... 3
3. SERVICES...................................................... 5
4. STATUS REPORTS................................................ 8
5. RATES AND CHARGES............................................. 8
6. INTELLECTUAL PROPERTY RIGHTS.................................. 9
7. NEW TECHNOLOGY................................................ 12
8. DATA AND CONFIDENTIALITY...................................... 12
9. FACILITY AND INFORMATION ACCESS............................... 15
10. REPRESENTATIONS AND WARRANTIES................................ 17
11. CORPORATE CITIZENSHIP......................................... 18
12. RECORDS; CONTROL REVIEW; AUDITS............................... 19
13. TERM.......................................................... 20
14. TERMINATION, EXPIRATION AND TRANSITION........................ 20
15. INDEMNITIES................................................... 22
16. LIMITATION OF LIABILITY....................................... 24
17. INSURANCE..................................................... 25
18. OTHER ARRANGEMENTS............................................ 26
19. DISPUTE RESOLUTION............................................ 26
20. GENERAL....................................................... 27
SCHEDULES
SCHEDULE A: SERVICES
SCHEDULE B: SELECTED FORD OPERATIONS
SCHEDULE C: LAUNCH PLAN
SCHEDULE D: MANAGED AGREEMENTS
SCHEDULE E: SERVICE OBJECTIVES
SCHEDULE F: STATUS REPORTS
SCHEDULE G: CHARGES / PRICING
SCHEDULE H: APPLICATION CONTROL REVIEW GUIDELINES
SCHEDULE I: PUBLICITY/ADVERTISING GUIDELINES
SCHEDULE J: PARENT GUARANTY
GLOBAL TRADE SERVICES AGREEMENT
This Global Trade Services Agreement is made this fourteenth day of July, 2000
(the "Effective Date"), by and between Ford Motor Company, a Delaware
Corporation having its principal place of business at Xxx Xxxxxxxx Xxxx,
Xxxxxxxx, XX 00000 (hereinafter "Ford") and Vastera Solution Services
Corporation, a Delaware corporation having its principal place of business at
00000 Xxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxx 00000 (hereinafter "Vastera"). As used in
this Agreement, "Party" means either Ford or Vastera, as appropriate, and
"Parties" means Ford and Vastera. The Parties agree that the following terms and
conditions shall apply to the products and services to be provided by Vastera
under this Agreement in consideration of certain payments to be made by Ford.
RECITALS
WHEREAS, Ford desires for Vastera to perform selected customs-related services
as further described in this Agreement.
WHEREAS, After careful evaluation of Vastera's proposals, Ford has agreed to
engage Vastera to render such services. After careful evaluation of Ford's
industry, business operations and needs, and Vastera's ability to satisfy such
needs, Vastera has agreed to perform such services. This Agreement documents the
terms and conditions of such arrangement.
NOW, THEREFORE, for and in consideration of the agreements set forth below,
Vastera and Ford agree as follows:
TERMS AND CONDITIONS
1. DEFINITIONS
1.1 CERTAIN DEFINITIONS
When used in this Agreement, the capitalized terms set forth below shall
have the meaning indicated:
(a) "AGREEMENT" shall mean this Global Trade Services Agreement
between the Parties, and shall include these Terms and
Conditions, all Schedules, Attachments to Schedules, and
any revisions or amendments made in accord with the terms
hereof.
(b) "CONTROL" and its derivatives (including "Controlling
Interest") shall mean, with regard to any entity, the
legal, beneficial, or equitable ownership, directly or
indirectly of fifty percent (50%) or more of the capital
stock (or other ownership interest if not a corporation) of
such entity ordinarily having voting rights or the ability
of a person to elect or designate a majority of the members
of the Board of Directors or other governing body of such
entity.
(c) "CUSTOMS PENALTY LOSS" shall mean Losses incurred by Ford
or a Ford Subsidiary attributable to any fines, penalties,
or additional charges imposed by a governmental entity or
other legal authority as a result of alleged or actual
non-compliance with applicable customs-related laws,
regulations, or rules.
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(d) "DELIVERABLES" shall mean (i) all materials, including any
information, designs, specifications, instructions, data,
and any documentation incorporating the foregoing, designed
or created for Ford by Vastera in the course of performing
its obligations under this Agreement, and (ii) the
Services.
(e) "DERIVATIVE WORK" means a work of authorship based on one
or more preexisting works, including, without limitation, a
translation, condensation, transformation, expansion or
adaptation, which, if prepared without authorization of the
owner of the copyright of such preexisting work, would
constitute a copyright infringement. The term "Derivative
Work" does not include the preexisting work upon which the
Derivative Work is based.
(f) "EQUIPMENT" shall mean the computer hardware, attachments,
peripherals and other computer and telecommunications
equipment used to provide the Services.
(g) "FEES" shall mean the Transaction Fee and the Gainsharing
Fee as set forth in Schedule G.
(h) "FORD" shall have the meaning set forth in the preamble to
the Agreement.
(i) "FORD GROUP" means Ford Motor Company, its Subsidiaries and
for purposes of this Agreement, Mazda Motor Corporation.
(j) "FORD PROPRIETARY PROPERTY" shall mean (i) facilities or
Equipment owned by Ford and used to provide the Services ,
(ii) Ford's Data, (iii) Intellectual Property owned by Ford
before the Effective Date, and (iv) other intellectual
property ownership rights created under this Agreement.
(k) "FORD'S DATA" means the information and data that is
proprietary to Ford and utilized by Ford to uniquely
operate Ford's business involving the importing and
exporting of its products, as that information and data
exists on the Effective Date and as it may evolve during
this Agreement.
(l) "GAINSHARING FEE" shall have the meaning set forth in
Schedule -G.
(m) "HSR ACT" shall mean the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended, and the related
regulations and published interpretations.
(n) "LOSSES" shall mean all liabilities, damages and claims,
and all related costs and expenses (including reasonable
legal fees, disbursements and costs of investigation,
litigation, settlement, judgment, interest and penalties).
(o) "NET 15TH AND 30TH PROX." is a payment term requiring that
(i) payments for invoices submitted prior to the 15th of a
given month are due on the 15th of the next month, and (ii)
payments for invoices submitted on or after the 15th of a
given month are due on the last day of the next month.
(p) "SERVICES" shall have the meaning set forth in Section 3.1
of the Agreement.
(q) "SOFTWARE" shall mean the programming and program listings
(including Source Code and object code) used to provide the
Services , and includes any additions, modifications,
enhancements or alterations to such programming or program
listings and copies thereof.
(r) "SOURCE CODE" means both machine-readable and
human-readable copies of Software, as well as all
modifications or enhancements to such Software, consisting
of instructions to be executed upon a computer in the
language used by its programmers (i.e., before compilation
or
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assembly) in a form in which the program logic of the
Software is deducible by a human being, fully commented,
and including all related flow diagrams and all other
documentation and manuals.
(s) "SUBSIDIARY" is any corporation, partnership, or other
entity in which a Party has a Controlling Interest. For
purposes of this Agreement, Visteon Corporation and Mazda
Motor Corporation are not Subsidiaries of Ford.
(t) "SYSTEM" or "SYSTEMS" shall mean all computer programs
(both source code and object code, unless otherwise
indicated) including, without limitation, software,
firmware, application programs, operating systems, files,
and utilities.
(u) "TERM" shall mean the Initial Term (as defined in Section
13.1) and any Renewal Terms (as defined in Section 13.2).
(v) "TRANSACTIONS FEE" shall have the meaning set forth in
Schedule G.
(w) "VASTERA" shall have the meaning set forth in the preamble
to the Agreement, and shall include any Vastera
subcontractors.
(x) "VASTERA'S INFORMATION TECHNOLOGY" means the computer
programs and systems including any associated files,
documentation and data that is proprietary to Vastera and
used by Vastera in the performance of Services hereunder,
and any modifications or Derivative Works based upon any
such program, system, file, documentation or data.
1.2 OTHER DEFINITIONS AND TERMS
Other terms used in this Agreement are defined in the context in which they are
used and shall have the meanings there indicated. Terms other than those defined
within this Agreement shall be given their plain English meaning, and those
terms, acronyms and phrases known in the information technology industry shall
be interpreted in accordance with their generally known meanings. Unless the
context otherwise requires, words importing the singular include the plural and
vice-versa, and words importing gender include all genders.
2. RELATIONSHIP OF PARTIES
2.1 RELATIONSHIP
Vastera, in performing its responsibilities and obligations under this
Agreement, is acting as an independent contractor. Neither Party will have any
right, power, or authority, express or implied, to bind the other Party, and
nothing in this Agreement shall be construed to create a partnership, joint
venture, or agency relationship between the Parties. Ford and Vastera shall not
be construed as joint employers for any purpose. Vastera may retain
subcontractors to perform its responsibilities and obligations under this
Agreement in its sole discretion, and has the sole right to supervise, manage,
contract, direct, procure, perform or cause to be performed, all work to be
performed by Vastera under this Agreement. In the event that Vastera issues
Powers of Attorney or other written authorization to a subcontractor to perform
such responsibilities or obligations, Vastera shall provide a copy of such
written Power of Attorney or other authorization to the Ford Liaison as
designated in Section 2.2 of this Agreement.
2.2 SERVICE MANAGEMENT
(a) Ford shall designate a Ford Liaison, and Vastera shall designate a
Vastera Liaison to:
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(i) Serve as the single point of contact for that Party
regarding such Party's performance under this Agreement and
communications with the other Party;
(ii) Assume responsibility for the overall supervision and
management of that Party's obligations under this
Agreement; and
(iii) Serve on the Management Team.
(b) Ford and Vastera agree that material aspects of the performance of
the parties under this Agreement shall be coordinated through such
designated liaisons. In all cases the Parties will make good faith
efforts to cause their respective Liaisons to respond in a timely
manner to inquiries or concerns from the other Party's designated
Liaison.
(c) The initial Ford Liaison is: Xxxxx Xxxx
*
(d) The initial Vastera Liaison is: Xxxx Xxxxx
*
2.3 MANAGEMENT TEAM
(a) Vastera and Ford shall establish an executive management steering
committee (the "Management Team") made up of the Vastera Liaison
(and any other Vastera personnel designated by Vastera) and the
Ford Liaison (and any other Ford personnel designated by Ford).
The Parties shall determine in writing the responsibilities of the
Management Team, but shall include at a minimum the following
responsibilities:
(i) review of the Parties' performance under this Agreement;
(ii) the facilitation of communication between the Parties; and
(iii) the overall management of the Parties' relationship as such
relationship pertains to Services.
(b) Unless otherwise agreed upon by the Parties, meetings of the
Management Team shall be held at least quarterly throughout the
Term. At least two representatives of each Party must participate
in Management Team meetings.
(c) The initial Ford members of the Management Team shall consist of:
Xxxxx Xxxxx, *
Xxxxx Xxxxxx, *
(d) The initial Vastera members of the Management Team shall consist
of:
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* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
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Xxxx Xxxxxxx, *
Arjun Rishi, *
3. SERVICES
3.1 SERVICES
Commencing as of the Effective Date and continuing throughout the Term, Vastera
shall be responsible for providing to Ford import and export trade management
services for selected Ford regions and selected Ford divisions and Subsidiaries
as further specified in Schedule A (the "Services"). Services will be provided
only to the Ford divisions, Subsidiaries, other entities, and regions specified
in Schedule B (the "Selected Ford Operations").
3.2 IMPLEMENTATION OF SERVICES
(a) There will be a phased implementation of Services beginning with
the United States on the Effective Date ("Initial Launch"). A
definitive Services implementation plan to transition the customs
activities of the Selected Ford Operations to Vastera (the "Launch
Plan") is attached hereto as Schedule C.
(b) Implementation of Services in any region outside the United States
is contingent on:
(i) A Successful Implementation of Services in the United
States. "Successful Implementation" means meeting all
implementation-related Service Objectives ("Implementation
Service Objectives", as further defined in Schedule E) and
satisfaction of all Launch Plan milestones for the United
States (as further described in the Launch Plan);
(ii) No material breaches of this Agreement by Vastera that
remain uncured; and
(ii) Ford obtaining all regulatory, governmental, and other
legal approvals that are required in connection with the
implementation of Services (e.g., German Werks Council
approval, etc.). Within thirty (30) days of the Effective
Date, the Management Team shall begin the process of
assessing the applicability of and obtaining all such
regulatory, governmental, and other legal approvals. Both
Ford and Vastera will use good faith efforts to support the
Management Team efforts.
Upon request by Vastera, Ford will discuss in good faith a waiver
of some or all of the implementation requirements set forth in
parts (i) through (iii) above.
3.3 MANAGED SUPPLIER AGREEMENTS
(a) Subject to Ford's contractual confidentiality obligations
(provided that Ford will use reasonable efforts, excluding
expenditure of funds other than nominal
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* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
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expenditures, to receive the consents necessary to disclose to
Vastera confidential information covered by such obligations),
Vastera will manage and administer selected agreements between
Ford and third party broker and freight forwarders (to the extent
that such agreements apply to customs operations) that are
identified and attached hereto as Schedule D (the "Managed
Agreements"), as further described in Schedule A. *. Vastera shall
also be responsible for the following with regard to the Managed
Agreements:
*
(b) Unless Ford provides its objections to Vastera and the affected
Third Party Service Provider within a commercially reasonable
time, Ford shall pay all Managed Agreement invoices that are
reviewed and approved by Vastera.
(c) Ford shall not enter into
(i) any import/export customs-related modifications or
amendments to existing Managed Agreements without written
consent from Vastera, which consent will not be
unreasonably withheld or delayed.
(ii) any new import/export customs-related third party broker
and freight forwarder agreements without written consent
from Vastera, which consent will not be unreasonably
withheld or delayed.
*
Nothing in this Agreement shall be construed as prohibiting
Ford from entering into broker and freight forwarder
agreements that do not relate to import/export customs
activities as described in Schedule A.
3.4 OPTION FOR ADDITIONAL SERVICES
Unless a Party provides notice of termination or non-renewal of this Agreement,
Vastera will have the right of first refusal in regions in which Vastera is
currently providing Services to Ford and Ford Subsidiaries (based on competitive
terms and pricing) for providing Services to Ford Subsidiaries to the extent
such Subsidiaries are not included in the Selected Ford Operations, provided
that such Subsidiaries may maintain and renew any third party contracts for
Services in effect as of the Effective Date, and also may manage such Services
internally without offering the right of first refusal to Vastera. At the option
of the Subsidiary and with written notice to Vastera, any existing third party
contract shall become a Managed Agreement under the scope of this Agreement,
subject to any contractual or other legal limitations or restrictions.
3.5 SERVICES FOR DIVESTED BUSINESS UNITS
If Ford ceases to Control one of the divisions, business units, or Subsidiaries
listed in Schedule B (such non-Controlled entity is referred to as a "Divested
Business Unit") that receives Services, each such Divested Business Unit shall
continue to receive Services at the Fees then in effect pursuant to this
Agreement in accordance with the following:
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* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
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(a) For a Divested Business Unit for which the end of Control occurs
prior the third anniversary of the Effective Date, such Divested
Business Unit must continue to receive Services until the fourth
anniversary of the Effective Date; and
(b) For a Divested Business Unit for which the end of Control occurs
on or after the third anniversary of the Effective Date, such
Divested Business Unit must continue to receive Services for at
least one year following the end of Control.
3.6 SERVICE OBJECTIVES
Vastera and Ford shall mutually agree upon the metrics and service objectives
for the Services identified and set forth in Schedule E attached hereto (the
"Service Objectives"). Vastera will use reasonable efforts to meet all Service
Objectives; a failure by Vastera to meet a Service Objective is referred to as a
"Violation". In the event that Ford provides written notice to Vastera that
specifies a Violation, then the Management Team will promptly discuss such
Violation. Ford may terminate this Agreement immediately upon written notice to
Vastera if, after the ninety (90) day period following the first Management Team
discussion, (i) the Management Team is unable to resolve the issue to both
Parties' satisfaction, and (ii) Vastera has not cured the Violation. For
purposes of this Section, a Management Team discussion includes any discussion
between at least two Management Team representatives from each Party. Both
Parties shall use reasonable efforts to cause the first Management Team
discussion to occur as promptly as practicable following Ford's notice to
Vastera of a Violation.
3.7 REQUEST FOR NEW SERVICES
Ford may from time to time during the Term request that Vastera perform a
service that is not within the scope of Services described in Schedule A (a "New
Service"). Upon receipt of such a request from Ford, Vastera shall provide Ford
with:
(a) a written description of the work Vastera anticipates performing
in connection with such New Service; and
(b) a schedule for commencing and completing such New Service.
(c) appropriate pricing and service level commitments
Vastera shall not begin performing any New Service until Ford and Vastera have
executed a written amendment to this Agreement for the performance of such New
Service.
3.8 TRANSITION SERVICES
Vastera will, unless Ford requests otherwise in writing, provide Services to *
in the regions specified in Schedule B (with regard to these four entities, such
Services are referred to as "Transition Services"), provided that Vastera's
obligation to provide such Transition Services shall end with respect to a given
entity on the date that an import/export customs services agreement between
Vastera and such entity becomes effective, or at such time as such entity
terminates its agreement with Vastera.
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* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
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3.9 THIRD PARTY SERVICES
Ford may at any time obtain additional Services not within the scope of the
Services specified in Schedule A for the Selected Ford Operations from any third
party service provider. Vastera shall fully cooperate with and work in good
faith with such third party service providers. Nothing in this Agreement shall
require Vastera to disclose Vastera Confidential Information to such third party
service providers, except to the extent agreed to by Vastera in writing.
4. REPORTS
(a) In order to facilitate the proper delivery of Services, Vastera
shall provide Ford with periodic written status reports, the
frequency and contents of which are further described in Schedule
F.
(b) Upon request by Ford, *.
5. RATES AND CHARGES
5.1 TRANSACTION FEE
Ford shall pay to Vastera a Transaction Fee as further described in Schedule G.
5.2 GAINSHARING FEE
Ford shall pay to Vastera a Gainsharing Fee as further described in Schedule G.
5.3 INVOICING
Vastera shall invoice Ford for all amounts due under this Agreement for Services
performed on a monthly basis. Notwithstanding the foregoing, for the period
starting on the Effective Date and ending on December 31, 2004, Vastera may
invoice Ford in advance for one-twelfth of the minimum annual Transaction Fee
amount set forth in Schedule G applicable to the month to which the invoice
applies, provided that Vastera may not submit such invoice more than five days
prior to the month to which the invoice applies.
5.4 PAYMENT DUE
Invoices will be payable by Ford Net 15th and 30th Prox. All amounts due and
payable to Vastera under this Article 5 shall be paid, at Ford's option, either
(i) by check payable to the order of Vastera or (ii) by electronic funds
transfer to Vastera from account(s) designated by Ford. Ford may withhold
payment of any Fees that Ford disputes in good faith, so long as Ford provides
written notice to Vastera of its intent to withhold payment.
5.5 ALL-INCLUSIVE RATES
The fees, charges, and adjustments set forth in Schedule G are all-inclusive,
and include all elements of any applicable tax. The Parties agree to cooperate
with each other to enable each
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* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
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to more accurately determine their own tax liability and to minimize such
liability to the extent legally permissible.
5.6 RATE REVIEW
With respect to each twelve (12) month period after the Effective Date, Vastera
shall conduct an internal review (the "Rate Review") to calculate * to third
parties that (i) manufacture, sell, or distribute motor vehicle-related goods or
services ("Third Party Fees") during that period, (ii) receive services from
Vastera that are substantially similar to Ford's Services, and (iii) pay *.
Vastera shall complete any Rate Review within thirty (30) days of such period.
At the conclusion of any Rate Review, Vastera shall furnish Ford with a letter
from a Vastera senior executive stating whether such Difference exists, and if
so, whether the Difference calculated by Vastera equals or exceeds *. If such
action plan cannot be developed to Ford's satisfaction within ninety (90) days,
or if Vastera fails to carry out a mutually acceptable action plan in accordance
with the schedule set forth in that action plan, then Ford may *.
6. INTELLECTUAL PROPERTY RIGHTS
6.1 FORD'S DATA
(a) Solely to the extent necessary to provide Services pursuant to
this Agreement, Ford hereby grants to Vastera, a worldwide,
nonexclusive, royalty-free, personal, nontransferable and limited
right and license: (i) to use; (ii) to operate; (iii) to maintain,
including, but not limited to, legally required record retention;
(iv) to copy solely for backup and archival purposes; (v) to
modify; and (vi) to create Derivative Works of Ford's Data as
necessary to provide the Services during the Term of this
Agreement.
(b) Upon the expiration or termination of this Agreement for any
reason, Vastera's rights and license(s) to Ford's Data shall
terminate, and Vastera shall return all copies in all media to
Ford, except to the extent and only for the period Ford's Data is
necessary for Vastera to provide services to Ford during the
Termination Transition Period, and thereafter returned or for such
period of record retention as may be required by law or regulation
in any jurisdiction in which the Services under this Agreement
have been performed, whichever period is longer..
6.2 VASTERA'S INFORMATION TECHNOLOGY
(a) Upon delivery or use of Vastera's Information Technology in
performing Services under this Agreement, Vastera shall grant to
the Ford and Ford Subsidiaries a limited nonexclusive and paid-up
license to use, reproduce, modify and prepare derivative works
based upon such Information Technology for the sole purpose of
supporting the business of the Ford Group but only to the extent
such use does not compete with directly with Vastera's
import/export customs trade management services provided to third
parties.
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* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
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(b) Upon expiration or termination of this Agreement, or the end of
the Transition Period, whichever is later, Ford's rights to
Vastera's Information Technology to use, reproduce, modify and
prepare derivative works shall terminate, provided that at Ford's
option, Ford may pay the annual license fees set forth in Schedule
G in order to license Vastera's Information Technology as
necessary for the continued internal business operation of the
Services by Ford Group or their contractors.
6.3 COPYRIGHTS
(a) FORD-SPECIFIC WORKS:
(i) Any original work of authorship created by Vastera in
performing the Services hereunder and that is created
uniquely for Ford or a Ford Subsidiary ("Ford Specific
Work") on or after the Effective Date, including but not
limited to Derivative Works based upon Ford's Information
Technology, shall be considered as a specially ordered or
commissioned "work made for hire," as that term is defined
in U.S. Copyright law (USC Title 17), and all copyrights
for such works of authorship shall belong to Ford or the
appropriate Ford Subsidiary. In the event any portion of
any work of authorship created by Vastera specifically for
Ford or a Ford Subsidiary in performing the Services
hereunder does not qualify as "work made for hire," Vastera
hereby assigns or, if Vastera has failed to previously
secure ownership of all copyrights in such portion from its
subcontractors, Vastera will use commercially reasonable
efforts to obtain title and assign all copyrights to such
Ford Specific Work to Ford or the appropriate Ford
Subsidiary. If such commercially reasonable efforts fail,
Vastera will create a materially similar alternative work
of authorship and assign all right and title to such
alternative work of authorship to Ford or the appropriate
Ford Subsidiary.
(ii) All Ford Specific Work referenced in Section 6.3(a)(i)
above shall bear a valid copyright notice designating Ford
Motor Company or the appropriate Ford Subsidiary as the
copyright owner.
(iii) With regard to each work of authorship created prior to
performing the Services hereunder for which copyrights are
owned or controlled by Vastera or for which Vastera has
rights to grant copyright licenses and which is included in
any Ford Specific Work referenced in Section 6.3(a)(i)
above ("Background Work"), Vastera hereby grants to Ford
and its Subsidiaries an irrevocable, nonexclusive, paid-up,
worldwide license under each and every such copyright to
reproduce the background work, to prepare derivative works
based thereon, to distribute copies of the background work
to the public, and to publicly or privately display the
background work without further accounting to Vastera, only
in conjunction with the Ford Specific Work.
(iv) Ford grants back to Vastera an irrevocable, nonexclusive,
paid-up, worldwide license under each and every such
copyright in such Ford Specific Work, with rights to
reproduce the Ford Specific Work, to prepare
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derivative works based thereon, provided such use is part
of Vastera's business of providing import/export customs
management services to others.
(b) NON-SPECIFIC WORKS: Any original work of authorship created by
Vastera in performing the Services hereunder and that is not a
Ford Specific Work shall be owned by Vastera and licensed to Ford
and its Subsidiaries under the terms of Section 6.2 above.
6.4 INVENTIONS
(a) With respect to inventions which Vastera conceives or first
reduces to practice in the course of performing Services and which
inventions relate to such Services, Vastera grants to Ford a
permanent, paid-up, nonexclusive, nontransferable worldwide
license, with a right to sublicense only the Ford Group, to use,
have used, and to otherwise practice processes covered by patents
on such inventions, for the sole and exclusive use by the Ford
Group.
(b) Vastera grants to Ford a permanent, paid-up, nonexclusive,
worldwide license, with a right to sublicense Ford Group, to make,
have made, use, have used and sell products and services, and to
otherwise practice processes covered by any other patents which
are now or hereafter owned or controlled by Vastera and only to
the extent such a license is necessary to exercise Ford's rights
in Section 6.4(a) above.
(c) In no event shall such license granted pursuant to Section 6.4(a)
or 6.4(b) permit Ford to compete directly with Vastera in the
provision of import/export customs trade management services
provided to third parties.
6.5 IP WARRANTY/INDEMNITY.
Vastera warrants that the transfer to Ford and Ford's use of Vastera's
Information Technology, including related documentation, will not infringe any
proprietary rights (including patents, copyrights, trademarks and trade secrets)
of any other entity. Vastera will indemnify and defend Ford from any claim,
liability and expense, including reasonable attorneys' fees, arising out of any
breach of the foregoing warranty, provided that Ford notifies Vastera in a
timely fashion of such claim. Vastera's obligation to indemnify and defend Ford
will apply except to the extent that such infringement is directly attributable
to Vastera's incorporation of Ford's Information Technology into Vastera's
Information Technology. In the event a claim of infringement is asserted,
Vastera may replace or modify the Software to make it non-infringing, provided
that Ford approves that such replacement or modification achieves the
substantive results of the original version of the Software which approval shall
not be unreasonably withheld, or Vastera may procure at its expense a license
for Ford to use the rights allegedly infringed.
6.6 MISCELLANEOUS
Vastera will neither assert nor transfer to another a right to assert against
Ford and/or its associated companies, or dealers or customers or suppliers
thereof, any intellectual property right of Vastera that is contrary to the
scope of any licenses granted to Ford or any of Ford's Subsidiaries in the
course of Vastera's activities hereunder.
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7. NEW TECHNOLOGY
*. Ford and Vastera recognize that Vastera will develop and market new software
and systems during the Term that can be applied to Services. Vastera agrees to
offer such new software and systems to Ford in connection with the provision of
Services by Vastera to Ford.
8. DATA AND CONFIDENTIALITY
8.1 SCOPE
During the course of this Agreement, the Parties each acknowledge that they may
be furnished with, receive, or otherwise have access to information of or
concerning the other Party, which such Party considers to be confidential. For
purposes of this Agreement, "Confidential Information" is defined as information
that is disclosed in connection with this Agreement and is furnished in the
following forms:
(a) All data in whatever form pertaining to Ford and Ford Subsidiaries
that is received, processed, or stored by Vastera;
(b) Any written information, including drawings, documents, financial
statements and projections, product and product cycle plans and
any other written information or machine readable data, of a Party
furnished to the other Party which is either marked "Confidential"
or contains a proprietary notice clause;
(c) Information, including demonstrations, which is furnished orally,
if it is identified at the time of oral delivery as being
Confidential Information and is confirmed as such by the
furnishing Party in a written instrument delivered to the
receiving party within fifteen (15) working days after such oral
delivery. Such confirmatory instrument shall specifically describe
the relevant Confidential Information and the date of its oral
delivery and refer to this Agreement; and
(d) Any item of hardware, including samples, devices and any other
physical embodiments, if an appropriate label is placed on such
hardware by the furnishing party identifying such hardware as
containing Confidential Information and such hardware is delivered
to the receiving Party.
In addition, the terms and conditions of this Agreement shall be deemed
Confidential Information.
8.2 NON-DISCLOSURE
The receiving Party shall, for a period beginning with the first date of receipt
of each respective disclosure and continuing for * thereafter or such period
during which information, data or records must be maintained under applicable
law or regulation, whichever period is longer, use at least the same degree of
care exercised by the receiving Party with respect to its own information of the
same nature as Confidential Information, but in any event no less than a
reasonable degree of care to maintain the confidentiality of Confidential
Information and to limit
----------
* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
12
its disclosure to such of its directors, employees, agents, advisors or
subsidiaries on a need to know basis. The receiving Party shall be responsible
for the compliance by such directors, employees, agents, advisors or
subsidiaries with the confidentiality provisions of this Agreement.
8.3 EXCEPTIONS TO CONFIDENTIALITY OBLIGATIONS
The confidentiality and limited use obligations of this Agreement shall not
apply to information received pursuant to this Agreement which:
(a) is or becomes publicly known other than through a breach of this
Agreement by the receiving Party; or
(b) is already known to the receiving Party at the time of disclosure
as evidenced by the receiving Party's written documentation; or
(c) is lawfully received by the receiving Party from a third party
without breach of this Agreement or breach of any other agreement
between the disclosing Party and such third party; or
(d) is independently developed by employees of the receiving Party who
have not had access to or received any Confidential Information
under this Agreement; or
(e) is authorized in writing by the disclosing Party to be released
from the confidentiality obligations herein.
8.4 OWNERSHIP OF CONFIDENTIAL INFORMATION
Confidential Information shall remain the exclusive property of the disclosing
Party. The receiving Party agrees that Confidential Information disclosed
hereunder is being received subject to the disclosing Party's ownership rights
in such Confidential Information and, further, subject to all relevant
intellectual and/or proprietary property rights of the disclosing Party,
including the relevant laws governing patents, trademarks, copyrights,
semiconductor chip protection, trade secrets and unfair competition.
8.5 RETURN OF CERTAIN CONFIDENTIAL INFORMATION
Upon the request of the disclosing Party, the receiving Party shall, at its own
expense, promptly return to the disclosing Party all originals and copies of the
writings and hardware in its possession which contain Confidential Information.
If any writing or hardware has been destroyed, an adequate response to a return
request therefor by the disclosing Party will be written notice, executed by the
receiving Party, that such writing or hardware has been destroyed.
8.6 USE OF CONFIDENTIAL INFORMATION
Confidential Information shall not be copied or used by the receiving Party for
any purpose other than in connection with a Party's obligations under this
Agreement. With regard to Confidential Information which is covered by
copyrights belonging to the disclosing Party, it is agreed that the disclosing
Party reserves all rights therein. However, the Parties further agree that a
limited number of copies of written materials covered by such copyrights (not
including machine
13
readable data) may be made by the receiving Party so that the receiving Party
can adequately use such Confidential Information within the terms and conditions
of this Agreement, provided that all proprietary legends and notices on the
originals are also reproduced on such copies and that each copy is controlled by
the receiving Party as an original in accordance with the terms of this
Agreement.
8.7 LEGALLY REQUIRED DISCLOSURE
(a) If the receiving Party becomes legally compelled (by oral
questions, interrogatories, request for information or documents,
subpoena, civil investigative demand or similar process) to
disclose any Confidential Information, the receiving Party will
provide the disclosing Party with prompt written notice so that
the disclosing Party may seek a protective order or other
appropriate remedy and/or waive compliance with the provisions of
this Agreement. In the event that such protective order or other
remedy is not obtained, or the disclosing Party waives compliance
with the provisions of this Agreement, the receiving Party will
furnish only that Confidential Information which is legally
required and will exercise reasonable efforts to obtain reliable
assurance that confidential treatment will be accorded the
Confidential Information so disclosed.
(b) If the receiving Party becomes legally required or compelled by a
governmental authority or agency to disclose any Confidential
Information, the receiving Party shall promptly notify the
disclosing Party of such disclosure. The notice of disclosure
shall include, but not be limited to, identification of the
authority or agency requiring or compelling the disclosure, the
scope of the disclosure, the statute, regulation or other
authority for requiring the disclosure, and exact copies of the
Confidential Information disclosed.
8.8 RIGHT TO ENJOIN DISCLOSURE
The Parties acknowledge that a receiving Party's unauthorized disclosure or use
of Confidential Information may result in irreparable harm. The disclosing Party
may seek a temporary restraining order and injunction to protect its
Confidential Information. The receiving Party will not raise the defense of an
adequate remedy at law. This provision does not alter any other remedies
available to the Parties or any other defense to prevent an award of preliminary
injunctive relief to the disclosing party.
8.9 NO PATENT OR TRADEMARK LICENSE
Nothing in this Section 8 shall be construed as granting or conferring upon a
Party, expressly, impliedly, or otherwise, any licenses or other rights under
any patents, trademarks or any other intellectual and/or proprietary rights
which the other Party hereunder now owns or may hereafter acquire.
8.10 FORD AND FORD SUBSIDIARY DATA
Notwithstanding anything to the contrary in this Section 8, all data pertaining
to Ford and Ford Subsidiaries processed by Vastera or stored by Vastera shall be
treated as Confidential Information during the Term and for two years thereafter
or such period during which information, data or records must be maintained
under applicable law or regulation, whichever period is longer, and shall not be
disclosed to anyone except employees, agents, and
14
contractors of Vastera who have a "need to know" the same in order to further or
facilitate the performance of the Services and who are legally bound to respect
the confidentiality thereof. All such data shall be and remain the property of
Ford or the applicable Ford Subsidiary and Vastera shall provide Ford with
reasonable access to any such data. Promptly after the termination or expiration
of this Agreement, Vastera will return to Ford all of Ford's and each Ford
Subsidiary's information, data, and files in Vastera's then-standard format and
media, subject only to any legally required data, document, or record retention
or maintenance. Subject to Section 8.2, Vastera shall exercise reasonable care
for the protection of such data and shall maintain reasonable data integrity
safeguards against the deletion or alteration of such data. In the event that
any such data is lost or destroyed because of any act or omission of Vastera or
any noncompliance with the obligations of Vastera under this Agreement, then
Vastera shall, at its own expense, reconstruct such data as soon as feasible.
9. FACILITY AND INFORMATION ACCESS
9.1 ACCESS TO FORD EQUIPMENT AND FACILITIES
Ford agrees to provide Vastera (including its subcontractors), at no additional
charge, with:
(a) use of a reasonable amount of temporary office space at Ford's
facilities for a period of time not to extend beyond *, as well as
the office services (including duplicating and internal mail
delivery services), office furniture, office supplies and such
other items as Ford provides to its own personnel as of the
Effective Date that are necessary from time to time for Vastera to
perform its responsibilities under the Agreement (provided that
Ford shall have no obligation to provide long-term office space
and office services to Vastera); and
(b) reasonable access to data communications and connectivity
(including with respect to Ford's LAN as well as local and
long-distance telephone access and connectivity), each as
reasonably necessary from time to time for Vastera to perform its
responsibilities under the Agreement.
9.2 ACCESS TO INFORMATION AND FORD PERSONNEL
(a) Subject to Ford's reasonable discretion regarding confidentiality
(provided that, for Ford's contractual confidentiality
obligations, Ford will use reasonable efforts, excluding
expenditure of funds other than nominal expenditures, to receive
the consents necessary to disclose to Vastera confidential
information covered by such obligations), Ford agrees to make
available any information or access to Ford's personnel (including
management personnel) that Vastera or its subcontractors
reasonably requests to perform their respective obligations under
this Agreement.
(b) With respect to either Party's obligations under the laws and
regulations of any jurisdiction in which Services under this
Agreement have been or are being performed, both Ford and Vastera
are to make available any information or access to the Party's
personnel as is required to satisfy the complying Party's legal
obligations and responsibilities.
----------
* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
15
9.3 PREMISES OBLIGATIONS
While on Ford or Ford Subsidiary premises ("Ford Premises"), Vastera will
examine the premises to determine whether they are safe for such Services, and
will advise Ford promptly of any situation that it deems to be unsafe. For
Services performed on Ford Premises in Canada, Vastera must furnish to Ford,
prior to payment of invoices for such Services, evidence of compliance with the
Canadian Worker's Compensation Act.
In addition, while on Ford Premises, Vastera's employees, contractors, and
agents shall (1) comply with the reasonable requests, standard rules, and
regulations of Ford regarding safety and health, personal and professional
conduct (including the wearing of an identification badge or personal protective
equipment and adhering to plant regulations and general safety practices or
procedures) generally applicable to such Ford facilities, which rules and
regulations Ford shall provide to Vastera upon Vastera's request, (2) not
possess, use, sell, or transfer illegal drugs, medically unauthorized drugs or
controlled substances, or unauthorized alcohol, (3) not be under the influence
of alcohol or drugs on Ford's Premises, and (4) otherwise conduct themselves in
a businesslike manner,
Ford may deny entry to Ford Premises by any Vastera employee, contractors, or
agents who violates any of the foregoing requirements.
9.4 CONDUCT OF VASTERA PERSONNEL
Vastera shall ensure that the Vastera employees maintain and enforce the
confidentiality provisions of this Agreement. In the event that Ford determines
that a particular member of the Vastera Service-related project staff (the
"Project Staff") is not conducting himself or herself in accordance with this
Section, Ford may notify Vastera of such conduct. Upon receipt of such notice,
Vastera shall promptly (a) investigate the matter and take appropriate action
which, if such member of the Project Staff is not conducting himself or herself
in accordance with this Section, may include (i) removing the applicable person
from the Project Staff and providing Ford with prompt notice of such removal and
(ii) replacing the applicable person with a similarly qualified individual or
(b) take other appropriate disciplinary action to prevent a recurrence. In the
event there are repeat violations of this Section by a particular member of the
Project Staff, Vastera shall promptly remove the individual from the Project
Staff as set forth above.
9.5 REQUIRED CONSENTS
Ford shall obtain such consents as may be required to provide Vastera access to
Ford's facilities as described in Section 9.1( the "Required Consents"). Ford
shall pay such fees as may be required to obtain the Required Consents. If a
Required Consent is not obtained, then, unless and until such Required Consent
is obtained, Vastera will act in good faith to provide the Services to the
extent practicable without such Required Consents, and Ford shall be responsible
for any reasonable additional costs associated with such alternative approaches.
9.6 POWERS OF ATTORNEY
Ford shall issue to Vastera Powers of Attorney or such other authorizations as
may be required by the laws or regulations of any jurisdiction in which the
Services of this Agreement are being or will be performed. If Vastera issues
Powers of Attorney or other similar authorizations to other persons or entities
related to the performance of the Services under this Agreement,
16
Vastera shall provide copies of such Powers of Attorney or other authorizations
to the Ford Liaison.
10. REPRESENTATIONS AND WARRANTIES
10.1 AUTHORIZATION
Each Party represents and warrants to the other that:
(a) It has the requisite corporate power and authority to enter into
this Agreement and to carry out the transactions contemplated by
this Agreement;
(b) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated by this Agreement
have been duly authorized by the requisite corporate action on the
part of such Party; and
(c) It is in compliance with all applicable laws and has obtained all
applicable permits and licenses required in connection with its
obligations under this Agreement;
10.2 NON-INFRINGEMENT
Vastera represents and warrants that it shall perform its obligations under this
Agreement in a manner that does not infringe, or constitute an infringement or
misappropriation of, any patent, copyright, trademark, trade secret or other
proprietary rights of any third party.
10.3 OWNERSHIP OR USE
Vastera represents and warrants that it is either the lawful owner of, or
authorized to use, the Vastera Proprietary Property, and that the Vastera
Proprietary Property has been lawfully developed or acquired by Vastera and
Vastera has the right to xxxxx Xxxx the rights granted herein to Vastera
Proprietary Property, including the rights of access and use.
10.4 COMPLIANCE WITH OBLIGATIONS
Each party represents and warrants that its execution and delivery of, and
performance of its obligations under, this Agreement does not violate or
constitute a breach of any of its contractual obligations with third parties.
10.5 WARRANTIES
(a) Vastera represents and warrants the following to Ford:
(i) The equipment and goods selected by Vastera (and not by
Ford) in providing the Services will be free of material
defects, and suitable and fit for the purposes of providing
Services under this Agreement; and
(ii) All Services will be performed by Vastera in a professional
and workmanlike manner, in accordance with generally
accepted industry practices and standards.
17
(b) Vastera will not be responsible and disclaims all express and
implied warranties for any inaccuracies in Deliverables to the
extent such inaccuracies are attributable to data and/or Ford
Proprietary Property or Systems provided by Ford to Vastera.
(c) THE WARRANTIES SET FORTH IN THIS AGREEMENT ARE IN LIEU OF ALL
OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED
TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE.
10.6 REGULATORY AND CORPORATE PROCEEDINGS
(a) Each Party agrees to obtain all necessary regulatory approvals
applicable to its business, obtain any necessary licenses, permits
and Required Consents, and comply with any regulatory requirement
or law applicable to the performance of the Services and their
other respective obligations under this Agreement.
(b) Vastera has obtained and provided to Ford copies of all licenses
and permits issued by any governmental authority or agency
required by Vastera to perform the Services under this Agreement.
10.7 EXERCISE OF REASONABLE CARE
(a) Vastera shall exercise reasonable care or such other applicable
standard of conduct as is applicable in any jurisdiction in which
the Services under this Agreement have been or are being
performed. Vastera's failure to exercise reasonable or such other
applicable standard of conduct shall entitle Ford to
indemnification, as provided in section 15.1 of this Agreement.
(b) If, in its performance of the Services or meeting the Objectives
under this Agreement, Vastera wants to take any action or position
that, in the judgment of a reasonable person in similar
circumstances, would expose or subject Ford to a material dispute,
challenge or enforcement action by any governmental authority or
agency (including, but not limited to, changes in the historic
classifications and historic valuations of Ford goods), Vastera
shall provide Ford with written notice of the proposed action or
position, along with an explanation and request Ford's consent
prior to taking any action or position, prior to taking any action
or position. Consent shall be given in Ford's sole discretion.
11. CORPORATE CITIZENSHIP
11.1 SMALL AND DISADVANTAGED BUSINESS CONCERNS
Ford serves from time to time as a contractor for the United States government.
The policy of the United States government expressed in Pub. L. 95-507, that
small business concerns and small disadvantaged business concerns will have the
maximum practicable opportunity to participate in performing contracts of the
United States government, and its clause entitled "Utilization of Small Business
Concerns and Small Business Concerns Owned and Controlled by Socially and
Economically Disadvantaged Individuals," apply to Ford U.S. and its U.S.
suppliers, including Vastera. A copy of the foregoing clause is available from
Ford upon request.
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11.2 SOURCING AND COMPLIANCE
*. Vastera will comply with federal laws, rules and regulations applicable to
subcontractors of government contractors, including those relating to
contracting with small and disadvantaged business concerns (Pub. L. 95-507);
contracting with business concerns operating in areas of surplus labor (41 CFR
1-1.805); and contracting with women-owned business concerns (Executive Order
12138).
12. RECORDS; CONTROL REVIEW; AUDITS
12.1 RECORDS
Vastera will create accurate records and books of account regarding its business
relating to the Services pursuant to this Agreement and maintain such records
for at least seven years after their creation.
12.2 CONTROL REVIEW GUIDELINES
Vastera shall cause all Vastera Systems utilized in support of Services to
qualify under the Ford Application Control Review Guidelines attached as
Schedule H.
12.3 GENERAL AUDIT
Only on * basis, Ford, upon notifying Vastera of the estimated scope and
duration of the audit will have the right upon at least * business days' prior
notice and during normal business hours to send its authorized representatives
to examine all pertinent documents and materials in the possession or under the
control of Vastera relating to any of Vastera's obligations under this Agreement
or any payments requested by Vastera pursuant to this Agreement. Except as
provided in Section 12.4 below, Ford will not have access to any information
relating to Vastera's other customers if the release of such information to Ford
would violate any confidentiality agreement with such customers.
Vastera will assist Ford's employees, agents, subcontractors, examiners or
auditors as may be reasonably required in testing Ford's data files and programs
created by Vastera in the course of performing its obligations under this
Agreement, including, without limitation, installing and running audit software.
If requested by Ford's external auditors or required by law (e.g., governmental
agency reporting purposes), Vastera will assist Ford in responding to those
requests and requirements, including copying.
12.4 RATES AUDIT
Ford shall have the right upon * business days' prior notice and during normal
business hours to have an independent certified public accounting firm ("Ford
Auditor") inspect, examine, audit and take extracts from or make copies of any
Vastera's records and books of account relating to whether or not Vastera's
Compliance Letters issued to Ford were inaccurate in any material respect. Ford
shall cause the Ford Auditor to agree that it will not disclose any financial
data
----------
* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
19
regarding any of Vastera's third party customers to Ford, except that if the
Ford Auditors identify an inaccuracy relating to any Compliance Letter delivered
to Ford, then the Ford Auditor may disclose the nature and magnitude of the
inaccuracy to Ford.
12.5 AUDIT EXPENSES
All costs and expenses, related to such audits will be fully borne by Ford,
except for audits where a Ford Auditor identifies material inaccuracies relating
to Compliance Letters, in which case Vastera will bear the costs and expenses
related to such audit. A "material inaccuracy" as used in this section means an
error favoring Vastera equal to or exceeding *.
13. TERM
13.1 INITIAL TERM
The term of this Agreement shall begin on the Effective Date and shall expire
ten (10) years after the Effective Date, unless terminated earlier or extended
in accordance with this Agreement (the "Initial Term").
13.2 RENEWAL TERMS
After the Initial Term, this Agreement shall automatically renew for successive
terms of three (3) years each (each of which shall be a "Renewal Term"), unless
this Agreement is terminated earlier in accordance with this Agreement.
14. TERMINATION, EXPIRATION AND TRANSITION
This Agreement may be terminated before the expiration of the Initial Term or
any Renewal Term in accordance with the provisions of this Section 14.
14.1 TERMINATION FOR CAUSE
(a) If either Party materially defaults in its performance under this
Agreement and fails to either substantially cure such default
within * after receiving written notice specifying the default,
then the Party not in default may terminate this Agreement
immediately upon written notice, as of a date specified in such
notice. If the nature of the default reasonably precludes a best
efforts cure by the defaulting Party within * of receipt of
written notice, then the defaulting Party must promptly (i) notify
the other Party in writing of such preclusion, (ii) commence
curing such default with reasonable best efforts and all due
diligence, and (iii) cure such default within * after receiving
the original written notice from the other Party. In the event
that such cure is not achieved within this * period, the other
Party may terminate this Agreement immediately upon written
notice, as of a date specified in such notice.
(b) Notwithstanding 14.1(a), in the event that a Party defaults in the
payment of any charges or other amounts due to the other Party
under this Agreement and fails
----------
* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
20
to cure such default within * days after receiving written notice
specifying such default, then the other Party may terminate this
Agreement immediately.
14.2 TERMINATION FOR CONVENIENCE
(a) Commencing upon August 1, 2003, either Party may terminate this
Agreement for convenience upon providing the other Party with one
year's written notice of such termination, provided that such
written notice must be sent by the terminating Party to the other
Party during the period starting on *. In the event that the
terminating Party fails to send notice during such period, such
notice will be deemed null and void so long as the other Party
responds in writing regarding such failure within * of receipt of
the original notice.
(b) Commencing upon * written notice of such termination, provided
that such written notice must be sent by the terminating Party to
the other Party during the period starting on *. In the event that
the terminating Party fails to send notice during such period,
such notice will be deemed null and void so long as the other
Party responds in writing regarding such failure within * of
receipt of the original notice.
14.3 OTHER TERMINATION
(a) Ford may terminate this Agreement in accordance with the
provisions set forth in Section 3.6 and 5.7. Either Party may
terminate this Agreement in accordance with the provisions set
forth in Section 16.2.
(b) Either Party may terminate this Agreement immediately upon written
notice to the other Party in the event that any HSR Act waiting
period applicable to the Stock Transfer Agreement among Ford,
Vastera, and Vastera, Inc. (the "Stock Issuance Agreement", dated
as of the date hereof) does not expire or is not terminated within
45 days of the submission of premerger notification filings by
both Parties.
(c) During the period starting on the Effective Date and ending sixty
(60) days thereafter (the "Sixty Day Period"), either Party may
terminate this Agreement upon written notice to the other Party,
provided that (i) the effective date of such termination will be
the day following the Sixty Day Period and (ii) in the event that
Vastera receives written approval or concurrence from the United
States Securities and Exchange Commission of its treatment of the
transactions contemplated by the Stock Issuance Agreement as a
business combination applying the purchase method of accounting
under generally accepted accounting principles, then neither Party
may terminate this Agreement pursuant to this Section 14.3(c),
regardless of whether notice of such termination has been provided
to the other Party.
14.4 CONSEQUENCES OF TERMINATION OR EXPIRATION
----------
* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
21
Upon the termination or expiration of this Agreement other than as a result of
an intentional breach by Xxxx, Xxxx, at its option, may provide Vastera with
written notification of Ford's desire to continue its access and use of the
Services for an additional twelve-month close down period (the "Termination
Transition Period") pursuant to the same terms and conditions set forth in this
Agreement. The Parties shall be obligated to maintain the then-current pricing
(unless the then-current pricing is not feasible for Vastera to derive a
reasonable business profit, in which case the pricing during the Termination
Transition Period will be based on Vastera's actual costs plus * markup) for the
entire Termination Transition Period. If Ford does not provide Vastera written
Termination Transition Period notification within fifteen (15) days from the
termination or expiration of this Agreement, then:
(a) Each Party shall return to the other Party within a reasonable
time all Confidential Information and other property (including
intellectual property) of such other Party that it does not have a
right to continue to use; and
(b) Commencing upon the expiration of this Agreement or upon any
notice of termination, and continuing for a period to be agreed
upon by the Parties, Vastera will provide to Ford, at the rates
set forth in Schedule G, transition assistance reasonably
necessary to transition Ford from Services.
15. INDEMNITIES
15.1 INDEMNITY BY VASTERA
To the full extent permitted by applicable law and subject to the limitations
set forth in Section 16, Vastera will defend, indemnify, and hold harmless Xxxx,
Xxxx Subsidiaries, their directors, officers, and employees ("Ford Indemnitees")
for all Losses incurred by Ford Indemnitees in connection with all claims
(including lawsuits, administrative claims, regulatory actions, and other
proceedings to recover for personal injury or death, property damage, or
economic loss) that are related in any way to Vastera's (i) breach of any of its
obligations under this Agreement, *, or (iv) *. Vastera's obligation to
indemnify under this Section will apply regardless of whether the claim arises
in tort, negligence, contract, warranty, strict liability, civil or criminal
investigation or enforcement by any governmental authority or agency, or
otherwise except to the extent of the contributory or superseding negligence of
Ford.
15.2 INDEMNITY BY FORD
To the full extent permitted by applicable law and subject to the limitations
set forth in Section 16, Ford will defend, indemnify, and hold harmless Vastera,
its directors, officers, and employees ("Vastera Indemnitees") for all Losses
incurred by Vastera Indemnitees in connection with all claims (including
lawsuits, administrative claims, regulatory actions, and other proceedings to
recover for personal injury or death, property damage, or economic loss) that
are related in any way to Ford's (i) breach of any of its obligations under this
Agreement, *, or (iii) * relates to:
(a) Ford's payment obligations under this Agreement; or
----------
* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
22
(b) Any inaccuracies in the information provided by Ford to Vastera
pursuant to Section 9.2.
Ford's obligation to indemnify under this Section will apply regardless of
whether the claim arises in tort, negligence (including gross negligence),
contract, warranty, strict liability, civil or criminal investigation or
enforcement by any governmental authority or agency, or otherwise except to the
extent of the contributory or superseding negligence of Vastera.
15.3 ADDITIONAL INDEMNITIES
Notwithstanding anything to the contrary in Sections 15.1 and 15.2, Vastera
shall be exclusively responsible for, shall bear, and shall defend, indemnify,
and relieve Ford and Ford Subsidiaries against and from liability for all Losses
resulting from bodily injury, sickness, or disease, including death at any time
resulting therefrom, sustained by any person or persons, or on account of damage
to or destruction of property, including that of Ford and Ford Subsidiaries,
arising out of, or in connection with the performance of work by Vastera's
employees, agents, and subcontractors on Ford's premises except that Vastera
shall not be responsible for or indemnify against, defend against, or relieve
Ford from liability for claims arising from the willful misconduct or the sole
negligence of Ford.
15.4 INFRINGEMENT
If any Vastera Proprietary Property becomes, or in Vastera's reasonable opinion
is likely to become, the subject of an infringement or misappropriation claim or
proceeding, Vastera shall, in addition to indemnifying Ford as provided in this
Section, promptly at Vastera's expense use reasonable efforts to secure the
right to continue using the item or replace or modify the item to make it
non-infringing. In the event neither of such actions is reasonably available to
Vastera, and only in such event, Vastera shall remove the item from the Services
and the parties shall mutually determine an equitable adjustment to Fees that
reflect such removal.
15.5 INDEMNIFICATION PROCEDURES
With respect to third-party claims, the following procedures shall apply:
(a) NOTICE. Promptly after receipt by any entity entitled to
indemnification under Sections 15.1 through 15.3 of notice of the
commencement or threatened commencement of any civil, criminal,
administrative, or investigative action or proceeding involving a
claim in respect of which the indemnitee will seek indemnification
pursuant to any such Section, the indemnitee shall notify the
indemnitor of such claim in writing. No failure to so notify an
indemnitor shall relieve it of its obligations under this
Agreement except to the extent that it can demonstrate damages
attributable to such failure. Within fifteen (15) days following
receipt of written notice from the indemnitee relating to any
claim, but no later than ten (10) days before the date on which
any response to a request, notice, subpoena, complaint or summons
is due, the indemnitor shall notify the indemnitee in writing if
the indemnitor acknowledges its responsibilities and obligations
with respect to such indemnification and elects to assume control
of the defense and settlement of that claim (a "Notice of
Election").
(b) PROCEDURE FOLLOWING NOTICE OF ELECTION. If the indemnitor delivers
a Notice of Election relating to any claim within the required
notice period, the indemnitor
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shall be entitled to have sole control over the defense and all
negotiations for the compromise, settlement, or resolution of such
claim; provided that (i) the indemnitee shall be entitled to
participate in the defense of such claim and to employ counsel at
its own expense to assist in the handling of such claim, and (ii)
the indemnitor shall obtain the prior written approval of the
indemnitee before entering into any settlement of such claim or
ceasing to defend against such claim. The indemnitor shall not be
required to indemnify the indemnitee for any amount paid or
payable by the indemnitee in the settlement of any claim for which
the indemnitor has delivered a timely Notice of Election if such
amount was agreed to without the written consent of the
indemnitor.
(c) PROCEDURE WHERE NO NOTICE OF ELECTION IS DELIVERED. If the
indemnitor does not deliver a Notice of Election relating to any
claim within the required notice period, the indemnitee shall have
the right to defend the claim in such manner as it may deem
appropriate, at the cost and expense of the indemnitor. The
indemnitor shall promptly reimburse the indemnitee for all such
costs and expenses.
(d) LIMITATION. Any settlement or award of such indemnification claim
shall be limited by Section 16 ("Limitation of Liability") of this
Agreement.
15.6 SUBROGATION
In the event that an indemnitor shall be obligated to indemnify an indemnitee
pursuant to Sections 15.1 through 15.3, the indemnitor shall, upon payment of
such indemnity in full, be subrogated to all rights of the indemnitee with
respect to the claims to which such indemnification relates.
16. LIMITATION OF LIABILITY
16.1 LIMITATION
(a) (i) Each Party's and each of its subcontractor's aggregate
liability for Losses resulting from its performance or
nonperformance under this Agreement regardless of the form
of action, and whether in contract, tort (including
negligence), warranty, or other legal or equitable grounds,
shall be limited to *.
(ii) Neither Party shall be liable for any Losses incurred by
the other Party that are attributable to a loss of profit
or revenue or to any other consequential, indirect,
incidental, special, punitive, or exemplary damages
suffered by the other Party, arising from or related to
this Agreement, even if such Party has been advised of the
possibility of such Losses.
(iii) Vastera shall be liable to Ford for Customs Penalty Losses
incurred by Ford or Ford Subsidiaries as a result of
Vastera's performance or non-performance under this
Agreement only to the extent that such Customs
----------
* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
24
Penalty Losses incurred in a given calendar year exceed a
threshold of * during that calendar year. For purposes of
calculating aggregate liability pursuant to Section
16.1(a)(i), only the annual Customs Penalty Losses that
exceed this threshold shall count toward such aggregate
liability.
(b) The limitations set forth in Section 16.1(a) above shall not apply
to:
(i) Losses by either Party for bodily injury or damage to real
property or tangible personal property; and
(ii) Losses by either Party that arise out of the other Party's
gross negligence or willful misconduct.
16.2 RIGHT OF TERMINATION
In the event that the foregoing limitation of liability in Section 16.1 directly
precludes full recovery of a Loss by a Party (the "Damaged Party"), then the
Damaged Party has the right to terminate this Agreement upon at least thirty
(30) days written notice to the other Party unless and until the other Party
fully compensates the Damaged Party for the portion of the Loss that was not
recoverable due to the foregoing limitation.
17. INSURANCE
During the term of this Agreement, Vastera agrees to maintain insurance in the
following amounts and coverage (including any applicable umbrella or excess
coverage):
(a) Workers' Compensation - Statutory limits or a State certificate of
self-insurance;
(b) Employers Liability Insurance - *;
(c) Commercial General Liability, including contractual liability
coverage - *;
(d) Automobile Liability - *; and
(e) Errors and Omissions Insurance - *.
Such policies of liability insurance, and any excess or umbrella policy carried
by Vastera above the limits specified above, shall be from insurers acceptable
to Ford and shall be endorsed:
(a) to provide that said insurance shall be primary insurance and to
acknowledge that any self-insurance or insurance policy or
policies of Ford shall be secondary or excess insurance
notwithstanding any provisions in such policies regarding other
insurance;
(b) to name Ford, its affiliates, subsidiaries, and their respective
directors, officers, agents and employees as additional insureds;
and
----------
* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
25
(c) to contain a provision requiring the insurers to provide Ford with
thirty (30) days' written notice of any cancellation or adverse
material change in such insurance.
Such policies shall be from insurers listed in the most recent "Best's Insurance
Guide" as possessing a minimum policyholder's rating of "A-" (Excellent) and a
financial category no lower than "VI" ($25 million - $50 million of adjusted
policyholders' surplus). Certificates evidencing the required coverage will be
provided by Vastera to Ford upon request.
18. OTHER ARRANGEMENTS
(a) Upon the execution of this Agreement, Ford and Vastera will
discuss in good faith the following arrangements:
(i) *; and
(ii) *.
19. DISPUTE RESOLUTION
If a material breach occurs or a dispute arises between the Parties relating to
this Agreement, the following procedure shall be implemented in lieu of
litigation, except that either Party may seek injunctive relief from a court
where appropriate in order to maintain the status quo while this procedure is
being followed:
(a) The Parties shall hold a meeting promptly, attended by persons
with decision-making authority regarding the dispute, to attempt
in good faith to negotiate a resolution of the dispute; provided,
however, that no such meeting shall be deemed to vitiate or reduce
the obligations and liabilities of the parties hereunder or be
deemed a waiver by a Party hereto of any remedies to which such
Party would otherwise be entitled hereunder.
(b) If within thirty (30) days after such meeting the Parties have not
succeeded in negotiating a resolution of the dispute, they agree
to submit the dispute to mediation in accordance with the then
current Model Procedure for Mediation of Business Disputes of the
Center for Public Resources and to bear equally the costs of the
mediation.
(c) The Parties will jointly appoint a mutually acceptable mediator,
seeking assistance in such regard from the Center for Public
Resources if they have been unable to agree upon such appointment
within twenty (20) days from the conclusion of the negotiation
period.
(d) The Parties agree to participate in good faith in the mediation
and negotiations related thereto for a period of thirty (30) days.
If the Parties are not successful in resolving the dispute through
the mediation, then the Parties agree to submit the matter to
binding arbitration or a private adjudicator.
----------
* This portion of the document has been omitted pursuant to a request for
confidential treatment and such portion has been filed separately with the U.S.
Securities and Exchange Commission.
26
(e) Mediation or arbitration shall take place in Pittsburgh,
Pennsylvania unless otherwise agreed by the parties. Equitable
remedies shall be available in any arbitration. Punitive damages
shall not be awarded. This Section is subject to the Federal
Arbitration Act, 9 U.S.C.A. Section 1 ET SEQ.
(f) In the event of arbitration, the Parties agree that the award of
the arbitrator shall be (1) the sole and exclusive remedy between
them regarding any claims, counterclaims, or issues presented to
the arbitrator; (2) final and subject to no judicial review; and
(3) made and shall promptly be payable in U.S. dollars free of any
tax, deduction, or offset. The Parties further agree that any
costs, fees, or taxes incident to enforcing the award shall, to
the maximum extent permitted by law, be charged against the Party
resisting such enforcement. The Parties hereto agree that judgment
on the arbitration award may be entered and enforced in any court
of competent jurisdiction. Each Party shall, except as otherwise
provided herein, be responsible for its own costs, including legal
fees, incurred in the course of any arbitration proceedings. The
fees of the arbitrator shall be divided evenly between the
Parties.
20. GENERAL
20.1 FORCE MAJEURE
Either Party's delay or failure to perform (except for a Party's payment
obligation) shall be excused for so long as, and to the extent that, it is
prevented from performing any of its obligations under this Agreement, in whole
or in part, as a result of delays caused by fire, flood, earthquake, elements of
nature or acts of God, riots, civil disorders, rebellions or revolutions in any
country, or any other cause beyond the reasonable control of such Party (a
"Force Majeure Event"). The non-performing Party shall promptly notify the other
Party of the circumstances causing its delay or failure to perform and of its
plans and efforts to implement a workaround solution. For as long as such
circumstances prevail, the Party whose performance is delayed or hindered shall
continue to use reasonable efforts to minimize the length and effect of delays
and shall re-commence performance after the cessation of the Force Majeure
Event.
20.2 ADVERTISING/PUBLICITY
Any reference to Ford or any of its associated companies or use of Ford's or a
Ford Subsidiary's trade marks or logos by Vastera in any advertising or
publicity materials will comply with Ford's Publicity/Advertising Guidelines
(MSP10-150), attached as Schedule I.
20.3 NON-SOLICITATION OF EMPLOYEES
(a) During the Term, Ford or any Ford Subsidiary will not solicit or
hire for employment any then-current employees of Vastera without
prior written approval from Vastera, which approval may be
withheld in Vastera's sole discretion. If a Vastera employee
terminates his or her employment with Vastera, then such employee
may be hired by Ford or a Ford Subsidiary no sooner than six
months from the date that such employee's employment is
terminated.
(b) During the Term, except for Ford employees seconded to Vastera,
Vastera will not solicit or hire for employment any then-current
employees of Ford or Ford Subsidiaries without prior written
approval from Ford or the applicable Ford
27
Subsidiary, which approval may be withheld in the employing
company's sole discretion. If a Ford or Ford Subsidiary employee
terminates his or her employment with Ford or the applicable Ford
Subsidiary, then such employee may be hired by Vastera no sooner
than six months from the date that such employee's employment is
terminated.
(c) Nothing contained in this Section shall preclude either Ford, a
Ford Subsidiary, or Vastera from making general solicitations
through advertisements or otherwise that are not specifically
targeted to such employees.
20.4 BINDING NATURE AND ASSIGNMENT
This Agreement shall be binding on the Parties hereto and their respective
successors and assigns. Except as otherwise provided in this Agreement, neither
Party shall assign this Agreement or delegate such Party's obligations hereunder
without the prior written consent of the other, except that either Party may
assign this Agreement without the consent of the other Party to an entity that
acquires all, or substantially all, of the business of the assigning Party
(provided that such entity is not a competitor of (i) Vastera (if Ford is the
assigning Party) or (ii) Ford or Ford Subsidiaries (if Vastera is the assigning
Party).
20.5 ENTIRE AGREEMENT; AMENDMENT; WAIVER
This Agreement, including the Schedules referred to herein and attached hereto
constitutes the entire agreement between the Parties with respect to the subject
matter hereof and supersedes all prior agreements, whether written or oral, with
respect to the subject matter contained in this Agreement. No amendment or
modification or waiver of a breach of any term or condition of this Agreement
shall be valid unless set forth in a writing signed by each of the Parties. The
failure of a Party to enforce, or the delay by either of them in enforcing, any
of their respective rights under this Agreement will not be deemed a continuing
waiver or a modification of any rights hereunder and a Party may, within the
time provided by applicable law and consistent with the provisions of this
Agreement, commence appropriate legal proceedings to enforce any or all of its
rights.
20.6 NOTICES
All notices, requests, demands, and determinations under this Agreement (other
than routine operational communications), shall be in writing and shall be
deemed duly given (i) when delivered by hand, (ii) one (1) day after being given
to an express, overnight courier with a reliable system for tracking delivery,
or (iii) six (6) calendar days after the day of mailing, when mailed by United
States mail, registered or certified mail, return receipt requested, postage
prepaid, and addressed as follows:
In the case of Ford: Ford Motor Company
Xxx Xxxxxxxx Xxxx, 00xx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
ATTENTION: Vice President, Material Planning
and Logistics
With copies to: Ford Motor Company
Xxx Xxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
ATTENTION: Assistant Tax Officer,
Corporate Finance
28
Ford Motor Company
Office of the General Counsel
Xxx Xxxxxxxx Xxxx, XXX Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000
ATTENTION: Assistant General Counsel
-- Transactions
In the case of Vastera: Vastera Solution Services Corporation
00000 Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxx 00000-0000
ATTENTION: General Counsel
With copies to: Vastera Solution Services Corporation
00000 Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxx 00000-0000
ATTENTION: Vastera designated Liaison
A Party may from time to time change its address or designee for notification
purposes by giving the other prior written notice of the new address or designee
and the date upon which it will become effective.
20.7 COUNTERPARTS
This Agreement may be executed in several counterparts, all of which taken
together shall constitute one single agreement between the Parties hereto.
20.8 SEVERABILITY
In the event that any provision of this Agreement conflicts with the law under
which this Agreement is to be construed or if any such provision is held invalid
by an arbitrator or a court with jurisdiction over the Parties, such provision
shall be deemed to be restated to reflect as nearly as possible the original
intentions of the Parties in accordance with applicable law. The remainder of
this Agreement shall remain in full force and effect.
20.9 CONSENTS AND APPROVAL
Except where expressly provided as being in the discretion of a Party, where
agreement, approval, acceptance, consent, or similar action by either Party is
required under this Agreement, such action shall not be unreasonably delayed or
withheld.
20.10 SURVIVAL
Any provision of this Agreement which contemplates performance or observance
after any termination or expiration of this Agreement (in whole or in part)
shall survive any termination or expiration of this Agreement and continue in
full force and effect.
20.11 THIRD PARTY BENEFICIARIES
This Agreement is entered into solely between, and may be enforced only by, Ford
and Vastera. This Agreement shall not be deemed to create any rights in third
parties, including suppliers and customers of a Party, or to create any
obligations of a Party to any such third parties.
29
20.12 CHOICE OF LAW
This Agreement and performance under it shall be governed by and construed in
accordance with the laws of the State of Michigan without regard to its choice
of law principles.
20.13 NEGOTIATED TERMS
The Parties agree that the terms and conditions of this Agreement are the result
of negotiations between the Parties and that this Agreement shall not be
construed in favor of or against any Party by reason of the extent to which any
Party or its professional advisors participated in the preparation of this
Agreement.
20.14 TITLES AND HEADINGS
Titles and headings of Sections of this Agreement are for convenience only and
will not affect the construction of any provision of this Agreement.
20.15 NO INDIVIDUAL AUTHORITY
Neither Party shall, without the express, prior written consent of the other
Party, take any action for or on behalf of or in the name of the other Party,
assume, undertake, or enter into any commitment, debt, duty or obligation
binding upon the other Party, except for actions taken pursuant to agreements
entered into between such Party or its Affiliates and any other Party.
20.15 PARENT GUARANTY
In connection with this Agreement, Ford and Vastera, Inc. have executed a Parent
Guaranty, attached hereto as Schedule J.
20.16 GOOD FAITH AND FAIR DEALING
In entering into this Agreement, Ford and Vastera each acknowledge and agree
that all aspects of the relationship between Ford and Vastera contemplated by
this Agreement, including the performance of all obligations under this
Agreement, will be governed by the fundamental principle of good faith and fair
dealing.
21. INCORPORATION BY REFERENCE AND ORDER OF PRECEDENCE
All Schedules and attachments attached hereto are hereby incorporated by
reference into this Agreement. Any amendments to this Agreement, Schedules and
attachments, and any other schedules and attachments that are agreed upon by the
Parties after the Effective Date, shall likewise be incorporated by reference
into this Agreement. Any conflict among or between the documents making up this
Agreement will be resolved in accordance with the following order of precedence
(in descending order of precedence): (1) This Agreement; (2) the remaining
Schedules; and (3) the attachments to the Schedules.
FORD MOTOR COMPANY VASTERA SOLUTION SERVICES CORPORATION
30
By: /s/ Xxxxx Xxxxxx By: /s/ Arjun Rishi
------------------------------- --------------------------------
Printed: Printed:
-------------------------- ---------------------------
Title: Title:
---------------------------- -----------------------------
Date: Date:
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