EXHIBIT 10.20
AGREEMENT
This Agreement is made and entered into effective as of the December 1, 1997
("Effective Date"), by and between First Franklin Financial Corporation, a
Delaware corporation, with its address at 0000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxx.
Xxxxxxxxxx 00000 ("First Franklin"), and Genesis 2000, Inc. a California
corporation with its principal place of business at 0000 Xxxxx Xxxxxxx
Xxxxxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxxxx 00000 ("Genesis"). "Party" or
"Parties" shall herein mean First Franklin and/or Genesis, severally or jointly,
and respectively.
RECITALS
WHEREAS, First Franklin and certain affiliates of First Franklin originate
prime and sub-prime mortgage loans, (collectively, "First Franklin Products"),
which are listed on Attachment 1 (and may be amended by First Franklin), from
time to time on a direct basis or through brokers, bankers, and banks;
WHEREAS, Genesis is a developer, marketer and producer of loan origination
software, and particularly a software product known as Genesis 2000 for Windows
(Microsoft Windows Version) ("Genesis Product"), which is described on
Attachment 2, and is licensed to brokers, bankers, and banks (collectively,
"Licensees") throughout the United States; and
WHEREAS, First Franklin and Genesis desire, to the extent stated herein, to
develop, support, maintain, promote and market a software capability and
electronic data interchange service in conjunction with the Genesis Product and
the First Franklin Products which facilitates the telecommunication of loan and
related financial documents, and resulting acknowledgment, approval and other
communications (collectively "Loan Information"), which are listed on Attachment
3, by and between the Licensees and First Franklin through and between Genesis'
dedicated server system ("Genesis Server") and First Franklin's computer
facilities and systems (collectively, "First Franklin Systems"), as described in
further detail on Attachment 4. For purposes of this Agreement, the development,
support and maintenance of such referenced software system and electronic data
interchange service shall be defined to mean the "Project," with the resulting
works being collectively defined to mean the "EDI Service."
First Franklin and Genesis agree as follows
I. DEFINED TERMS
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For the purposes of this Agreement, the following terms shall have the meanings
set forth herein:
[*] Confidential Treatment Requested
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"Acknowledgement" shall mean the electronic communication between First
Franklin and Licensees confirming receipt of data via the EDI Service.
"Application" shall mean data received via the EDI Service contemplated
herein. Furthermore, data must be substantially complete to the extent that it
meets the requirements set forth by FHLMC to render an underwriting decision via
its Loan Prospector Automated Underwriting System.
"Credit" shall mean the data describing the complete merged credit history
of all loan applicants as provided in the ordinary course of business by all
three national credit repositories (Equifax, Trans Union, and TRW). Such data
shall include, but not be limited to: applicant names, social security numbers,
public records, creditors, account numbers, credit type, date account opened,
date account last reported, dollar amount of credit approved, current account
balance, monthly payment due, payment status, payment history, amounts past due
(if any), and a credit score from each national credit repository.
"Documentation" shall mean the human-readable user and reference manuals as
well as all related written materials that accompany the Genesis Product as well
as the EDI Service.
"Development Completion" shall mean the date upon which First Franklin
signs the Notice of Development Completion as defined in Section 1.2.
"Development Period" shall mean that time from the Effective Date of this
Agreement until Development Completion.
"EDI Service" shall mean the electronic data interchange service enabling
brokers, bankers, and banks which utilize the Genesis Product, to send
information to and receive information from First Franklin.
"FF Xxxxxx" shall mean a menu option or icon resident within the Genesis
Product which provides the Licensees the ability to access the EDI Service.
"First Franklin Products" shall mean the sub-prime mortgage loan programs
offered and amended from time to time by First Franklin.
"First Franklin Systems" shall mean First Franklin's computer facilities,
hardware, and software applications.
"Funding" shall mean the recordation of a new lien against a loan
applicant's property which secures a loan made by First Franklin to the
applicant(s). If First Franklin is unable to obtain recordation information
within ten (10) days of loan funding, then First Franklin shall be required to
notify Genesis of the unfunding of the loan; otherwise, the loan will be
considered funded for the purposes of this Agreement.
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"Genesis Product" shall mean a software product developed, marketed, and
produced by Genesis known as Genesis 2000 for Windows.
"Genesis Server" shall mean the dedicated server system, responsible for
providing and maintaining the EDI Service.
"Initial Period" shall mean that period of time commencing from Development
Completion and expiring at 12:00 AM Pacific Standard Time [*].
"License Agreement" shall mean the terms and conditions set forth in the
agreement executed by a user of the Genesis Product.
"Licensed Party" shall mean the party granted the authority to utilize the
trademarks and service marks of the other party to this contract to promote and
support the EDI Service.
"Licensee" shall mean any user of the Genesis Product who has executed the
License Agreement.
"Licensing Party" shall mean the party granting the authority to utilize
the trademarks and service marks owned by it to the other party to this contract
to promote and support the EDI Service contemplated herein.
"Operational Testing" shall mean that testing designed to verify that the
EDI Service executes its functionality as defined in the project Work Plans.
"Loan Information" shall include but not be limited to the Application,
Credit, Ratesheet, Ratelock, Underwriter Analysis, Pipeline Report, and
Acknowledgement defined herein.
"Marks" shall mean the trademarks and service marks individually owned by
First Franklin and Genesis.
"PipelineReport" shall mean the data which describes the last recorded
status update by First Franklin for each Application sent by a Licensee via the
EDI Service.
"Prime Loans" shall mean any borrower with the following Credit:
1. A FICO bureau score provided by any of the three national
credit repositories (Equifax, Trans Union, or TRW) which is above
[*]; AND
2. No [*] day mortgage lates in the last [*] months, and no
more than one [*] day mortgage lates in the past [*] months; AND
3. Not more than [*] of the open revolving and installment
tradelines [*] days or more past due in the last [*] months; AND
4. No outstanding judgements, collections, or tax liens or any
bankruptcy in the past three years at the time of initial loan
application
[*] Confidential Treatment Requested
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"Project" shall mean the development, testing, support, and maintenance of
the EDI Service contemplated herein.
"Ratelock" shall mean the data required by First Franklin from a Licensee
to commit First Franklin to an interest rate and fee combination for a
prescribed period of time which is desired by a loan applicant.
"Ratesheet" shall mean the data sent to a Licensee which describes the
interest rate and fee combinations made available by First Franklin from time to
time and in the ordinary course of business.
"Sub-prime Loans" shall mean any borrower not meeting the Credit criteria
defined herein for Prime Loans, but excludes the following types of loans:
1. Any Government Loans, including but not limited to FHA, VA, Title I,
203K.
2. Home Equity lines of credit
3. Second Mortgages
4. Construction Loans
"Test Period" shall mean the period of time that Operational Testing will
be performed.
"Transaction Fee" shall mean the fee due Genesis for each loan received
through the EDI Service which is eventually funded by First Franklin.
"Underwriters Analysis" shall mean the data describing the approval,
suspension, or denial of a particular Application and any underlying
underwriting conditions.
"Work Plans" shall mean a listing of all tasks which are reasonably
believed to be required in order to complete the Project. The Work Plan shall
also include specific schedules for completion of the tasks set forth therein,
which shall not be modified unless mutually agreed to in writing by both parties
to this Agreement.
ARTICLE 1
PROJECT DEVELOPMENT
Section 1.1 General. First Franklin and Genesis agree to cooperate in the
Project to the extent that:
(a) Genesis will be responsible, at its sole cost and expense, for the
development of a functional capability in the Genesis Product, which will
provide the Licensees the ability to enter into the Genesis Server using
the FF Button thereby permitting the Licensees to telecommunicate to and
receive from First Franklin the Loan Information for processing purposes.
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(b) First Franklin will be responsible, at its sole cost and expense, for
the development of a functional capability in the First Franklin Systems to
receive and further telecommunicate to the Licensees via the Genesis Server
as to and with respect to the Loan Information.
(c) Specifically, each Party shall be responsible for the development
efforts described in the Work Plans which are listed on Attachment 5. The
Work Plans listing is understood to be a good faith assessment, as of the
Effective Date, of the tasks that may be required in order to complete and
maintain the Project, and that such listing is anticipated to be modified
as the early stages of the Project proceed towards its conclusion, such
modifications being agreed to in accordance with Section 1.4.
(d) The Parties will conduct Operational Testing of The EDI Service, to
the extent agreed to by the Parties, involving the participation of
four (4) Licensees designated by both parties, which may be increased
or decreased by mutual agreement, for a Test Period of [*],
unless otherwise extended or shortened by agreement of the
Parties. Upon completion of the Operational Testing, Genesis shall
deliver to First Franklin a Notice of Development Completion
validating correct operation of the EDI Service.
Section 1.2 Development Commitment. First Franklin and Genesis shall each
allocate and dedicate adequate and sufficient funding, staff and other resources
to meet the respective obligations under any Work Plans and shall use reasonable
efforts to complete each step in the Work Plan. Until the Project is completed,
Genesis and First Franklin mutually agree to a minimum of two (2) meetings
and/or conference calls per month. Genesis shall also deliver a written report
to First Franklin with respect to the status and progress toward completion of
the Project. This report shall be delivered to First Franklin no later than the
fourth business day of each month subsequent to the Effective Date of this
Agreement.
Section 1.3 Cooperation. The Parties will cooperate to achieve all Work Plan
goals on or before the date set forth in the applicable Work Plans and each
shall provide or otherwise disclose (subject only to the confidentiality
provisions as set forth herein) to the other all relevant technical information
in its possession in order to assist the other Party in performing its tasks
hereunder. Each Party shall use its reasonable efforts to design and produce
components that are compatible, and to conduct and conclude such development in
a professional manner, to incorporate into prototype such modifications as
testing indicates is necessary or as may be reasonably requested by the other
Party, and to conduct such further tests as may be required under the
circumstances. Each Party shall use its reasonable efforts to produce
appropriately detailed test procedures and associated Documentation as may be
necessary in order to fully utilize the components. Genesis shall be responsible
to create, maintain and update such Documentation as is reasonably practical but
no later than quarterly should an update to the EDI Service occur within that
period of time.
Section 1.4 Work Plan Revisions. All components of a Work Plan, except the
time schedules or Work Plan goals incorporated therein, may be revised from time
to time as suggested by the
[*] Confidential Treatment Requested
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Party responsible for the development activities under such Work Plan, provided
that such revisions are approved by the other Party (such approval shall not be
unreasonably withheld or delayed). In the event that a proposed revision is
rejected by the other Party, the Party shall promptly confer to determine if
mutually acceptable modifications may be made to overcome the stated reasons for
rejection. If mutually acceptable modifications are agreed upon, the revised
Work Plan shall be deemed approved. All Work Plan goals, design specifications
and time schedules incorporated within Work Plans may be revised from time to
time as deemed appropriate and evidenced by the written agreement of the
authorized representative of each Party.
Section 1.5 Incorporation of Design Suggestions. Each Party shall consider,
and shall not unreasonably refuse to revise its respective components, including
the design features and functionality applicable to such components as set forth
in any Work Plan, in accordance with suggestions made by the other Party.
Section 1.6 Exclusive Territory.
(a) For the Initial Period of this Agreement, Genesis agrees not to provide a
competitive service or similar functionality as the EDI Service to any other
financial lender for sub-prime loans. First Franklin agrees not to promote or
otherwise enter into any agreements with any other computer software company's
software or service which is competitive with or performs functions
substantially similar to the EDI Service. Genesis agrees to provide First
Franklin with no less than six (6) months prior written notice when and if
Genesis offers a competitive service or similar functionality as the EDI Service
to any other financial lender for sub-prime loans, however no such competitive
service or similar functionality as the EDI Service shall be operational or in
use by any other such financial lender during the Initial Period defined herein.
If the six (6) months notice period, or any part thereof, transpires after the
Initial Period, Genesis is permitted to offer a competitive service or similar
functionality as the EDI Service to any other financial lender for subprime
loans during such notice period (and thereafter) that transpires after the
Initial Period. Notwithstanding the foregoing in subsection 1.6(a), Genesis is
permitted to offer a competitive service or similar functionality as the EDI
Service for processing sub-prime loans through Xxxxxx Xxx and Xxxxxxx Mac.
However, in no event may any of these entities or their affiliates utilizing the
competitive service, other than Xxxxxx Mae or Xxxxxxx Mac, be engaged in the
business of funding loans or purchasing loans from mortgage brokers, mortgage
bankers, banks or lending directly to consumers.
(b) First Franklin agrees not to promote or otherwise enter into any agreements
with any other computer software company's software or service which is
competitive with or performs functions substantially similar to the EDI Service.
ARTICLE II
LICENSE
Section 2.1 Appointment; Nature of Relationship. Subject to the terms and
conditions of this Agreement, Genesis hereby appoints First Franklin, for the
term of this Agreement, a nonexclusive
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licensee for the use of the Genesis Product in any number of First Franklin's
CPU workstations provided that these CPU's be operated by First Franklin
personnel during use of the EDI Service and subject to the License Agreement set
forth in Attachment 6 hereto.
Section 2.2 Additional Licensing Authority. Genesis furthermore grants to First
Franklin, at no cost to First Franklin, but subject to the terms and conditions
of this Agreement and the License Agreement (except as provided below), a non-
transferable license during the term of this Agreement:
(a) To demonstrate the Genesis Product to its clients, brokers, loan
agents, or customers or potential clients, brokers, loan agents, or
customers;
(b) For use of the Genesis Product by members of First Franklin's Business
Development staff and associated employees and agents for the purpose of
supporting and promoting the relationship established by this Agreement;
and
(c) To use Genesis' technical information solely in connection with the
development of any linking components required to be developed by First
Franklin.
(d) Assignment by First Franklin to a parent, subsidiary, or affiliate
entity shall be permitted without prior written consent from Genesis.
Section 2.3 Trademarks and Service Marks Grants. Each Licensing Party grants to
the Licensed Party a nonexclusive, limited license to use the Licensing Party's
Marks arising from and associated with the Project and promotion and support of
the EDI Service. Such use will comply with guidelines, graphic standards, and
similar criteria provided by the Licensing Party and the terms of this
Agreement. The Licensed Party shall not have the right to grant any sublicenses
of Marks. The Licensed Party acknowledges the Licensing Party's proprietary
interest in and to all the respective Marks and the related goodwill associated
therewith. The Licensed Party further agrees and acknowledges (a) it acquires no
right, title or interest in or to any of the licensed Marks by virtue of this
Agreement or any use of such Marks, and (b) will not contest or challenge the
validity of or any use of such Marks, or the registration or ownership by the
Licensing Party, its parent, or affiliates. Except thus consented to by the
Licensing Party, the Licensed Party will not combine any of the Licensing
Party's Marks (whether used pursuant to a license or otherwise) in any corporate
or trade name. All goodwill rising from the use of the respective Party's Marks
shall inure solely to the benefit of the Licensing Party.
Section 2.4 Term of License Grants. The licenses granted under Article II
shall terminate upon the termination of this Agreement, except as otherwise
stated in this Agreement.
ARTICLE III
OTHER RESPONSIBILITIES
Section 3.1 Responsibilities of Genesis. During the term of this Agreement:
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(a) Warranty. Genesis will provide warranty services and support
consistent with the terms of the applicable license agreement provided to
each Licensee.
(b) Development and Support. To the extent reasonable and practical,
Genesis shall use reasonable efforts to maintain, support and enhance the
Genesis Product and The Genesis Server as is necessary to effect the
purposes and objectives of this Agreement. Genesis will maintain and
support the Licensees to no less an extent than that which it provides
maintenance and support to its other customers.
(c) FF Xxxxxx or EDI Access. During the term of this Agreement and as
permitted by the provisions contained in Article IV, Genesis agrees to
ensure that all releases of the Genesis Product have or maintain the FF
Button.
Section 3.2 First Franklin Obligations. During the term of this Agreement:
(a) Loan Information Transactions. First Franklin agrees to not
discriminate against the Licensees in the processing, review and approval
of submitted Loan Information pursuant to the EDI Services, including, but
not limited to, not assessing additional charges to any third party for
such telecommunication transactions.
(b) Development and Support. To the extent reasonable and practical, First
Franklin shall use reasonable efforts to maintain and support and also
develop such additional customization of the First Franklin System as is
necessary to effect the purposes and objectives of this Agreement.
(c) Dedicated Lease Line. First Franklin will be responsible for providing
a dedicated telecommunication line for connection between the Genesis
Server and the First Franklin System in order to facilitate the EDI
Service.
Section 3.3 Joint Responsibilities. During the term of this Agreement:
(a) Training. Genesis and First Franklin agree to provide cross-training
to each other's personnel, as well as ongoing product education to their
own personnel, periodically, during the term of this Agreement. Unless
otherwise agreed to by the Parties, all training shall be conducted by
telecommunications or written or e-mail dialogue or physically at the
educating Party's facilities, or at the trainees facility upon mutual
agreement. Any and all travel and related expenses incurred by trainees
shall be borne by the trainees' employer.
(b) Technical Support. In order to perform each other's respective
technical maintenance and support obligations under Sections 3.1 and 3.2,
each Party agrees to support the other Party to the extent necessary to
fulfill the intent of this Agreement. Furthermore, Genesis and First
Franklin agree to cooperate to insure that the upgrades and updates of each
Party's products and services are compatible with current existing programs
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of the other Party and will continually consult with one another on methods
to improve the quality of the EDI Service. Genesis and First Franklin will
work together to insure that appropriate technical support is provided to
the Licensees in order to enhance the quality and level of service to such
Licensees.
(c) Marketing. Each Party agrees to use reasonable efforts in marketing
and promoting the EDI Service and the Genesis Product, as each shall
determine in its sole discretion. If requested by a Party, the responding
Party shall be permitted to submit suggestions to the requesting Party.
Section 3.4 Data Content Retention Disclaimer. First Franklin acknowledges
that Genesis will not be responsible for maintaining or storing the EDI Service
transactions data content.
ARTICLE IV
PAYMENTS AND FEES
Section 4.1 Transaction Pricing. First Franklin agrees that during the term of
the Initial Period it will pay to Genesis a Transaction Fee equal to [*] for
Subprime Loan and [*] for each Prime Loan for each First Franklin Products
Funding.
Section 4.2 Development Charges. [*] in the course of developing and
enhancement of the EDI Service pursuant to this Agreement.
Section 4.3 Payment. First Franklin will on a monthly basis for all First
Franklin Products Funding in the previous calendar month, and in any case no
later than on the 20th of each month, pay to Genesis all amounts due pursuant to
Section 4.1. First Franklin will prepare and present with each payment a
detailed written statement which supports the then current payment. All other
amounts due Genesis pursuant to this Agreement will be due and payable net
thirty (30) days of invoice from Genesis. Any amounts due First Franklin from
Genesis will be itemized and deducted from the amounts due Genesis pursuant to
this section and sections 4.1 and 4.2. First Franklin will make payments without
deduction in US Dollars by First Franklin check or wire transfer of immediately
available funds to Genesis or to such bank account as specified by Genesis. Any
and all late payments, not correctly objected to or not object to, shall accrue
late charges at the rate of one and one-half percent (1 1/2%) per month until
paid in full; any interest in excess of the maximum amount permitted under law
is waived.
Section 4.4 Maintenance and Auditing of Records. First Franklin agrees to
maintain for a period not to exceed eighteen (18) months from the date of the
transmission, the pertinent EDI Service transaction traffic record which relates
to and support the payments due under this Article IV. First Franklin agrees to
maintain for a period not to exceed one (1) year any and all First Franklin
System transaction traffic records related to the EDI Service transactions.
Genesis agrees to maintain for a period not to exceed eighteen (18) months form
the date of the performed services, the pertinent performed service hours which
relate to the payment due under this Article IV. Each
[*] Confidential Treatment Requested
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Party shall be permitted the right to audit or cause a representative of the
auditing Party to audit such other Party's relevant records in order to support
or ascertain the correctness of the amounts due or paid under this Article IV.
Such audit is subject to (a) no less than twenty (20) days written notice must
be provided to the other Party, (b) the audit must be conducted during normal
business hours of the audited Party, (c) no more than one (1) audit per quarter
may be conducted. If an audited period results in a determination in favor of
the auditing Party, then the auditing Party shall be entitled to reimbursement
of its incurred reasonable auditing expenses, but not to exceed the incorrect
amounts due the auditing Party.
ARTICLE V
PROPRIETARY RIGHTS
Section 5.1 Genesis Proprietary Rights. First Franklin acknowledges and agrees
that all copyright, patents, trade secrets, trademarks and all other proprietary
rights in and to the Genesis Product, the Genesis Server and the EDI Service
(except to the extent stated in Section 5.2), shall at all times remain with
Genesis, including but not limited to all releases, versions, modifications,
enhancements and all copies thereto (whether or not based on recommendations,
input or otherwise from First Franklin pursuant to this Agreement, in which
event First Franklin agrees to and herein assigns such rights to Genesis). If,
and when requested by Genesis, First Franklin will execute and promptly deliver
to Genesis any reasonable assignment documents in order to fulfill the intent of
this section 5.1.
Section 5.2 First Franklin Proprietary Rights. Genesis acknowledges and agrees
that all copyright, patents, trade secrets, trademarks and all other proprietary
rights in and to the First Franklin System, shall at all times remain with First
Franklin, including but not limited to all releases, versions, modifications,
enhancements and all copies thereto (whether or not based on recommendations,
input or otherwise from Genesis pursuant to this Agreement, in which event
Genesis agrees to and herein assigns such rights to First Franklin). If, and
when requested by First Franklin, Genesis will execute and promptly deliver to
First Franklin any reasonable assignment documents in order to fulfill the
intent of this Section 5.2.
Section 5.3 General Principles. Nothing stated in this Article V shall be
deemed to restrict either Party from utilizing or otherwise exploiting, without
compensation to the other Party, any ideas or concepts which are considered to
be general principles found in the industry through other sources.
ARTICLE VI
TERM AND TERMINATION
Section 6.1 Term. This Agreement shall commence on the Effective Date, and shall
remain in full force and effect for the Initial Period of [*] commencing from
the expiration date of the Test Period, and shall continue thereafter, unless
First Franklin gives no less than [*] written notice of termination to Genesis
or Genesis gives First Franklin no less than [*]
[*] Confidential Treatment Requested
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written notice of termination, but in any case the term shall not extend for
more than [*] unless otherwise agreed to in writing by the parties; unless in
any case it has been sooner terminated as provided in this Agreement.
Section 6.2 Termination. This Agreement may be terminated at any time prior to
the expiration of its then current annual term, as follows:
(a) By either Party by written notice to the other Party if a receiver
shall have been appointed over the whole or any substantial part of the
assets of the other Party, a petition or similar document is filed by the
other Party initiating any bankruptcy or reorganization proceeding, or such
a petition is filed against the other Party and such proceedings shall not
have been dismissed or stayed within sixty (60) days after such filing;
(b) By either Party upon written notice if the other Party has breached
any material term(s) of this Agreement and fails to cure such breach within
thirty (30) days after receipt of written notice of such default, but only
ten (10) days for breach of First Franklin's payment obligations under this
Agreement; or
(c) An adverse judgment, or award is entered against the other Party,
having a material adverse impact on the financial solvency of the other
Party.
Section 6.3 Post Termination Effect. Upon any termination or expiration of this
Agreement:
(a) Both Parties shall continue to jointly support and maintain the EDI
Service, to the extent of each Party's responsibilities prior to such
termination or expiration, for a term of [*] to the same extent
stated in this Agreement, unless otherwise improper pursuant to Section
6.2. Thereafter, each Party shall, in addition to the requirements under
Section 10.5, promptly return to the other Party all proprietary materials
of the other Party, including all copies thereof, with a written affidavit
from an officer of the Party certifying full compliance with this
provision after conducting a reasonable due diligence.
Section 6.4 Survival. Those sections to this Agreement which by their terms
should survive any expiration or termination of this Agreement shall accordingly
remain in full force and effect after any expiration or termination of this
Agreement.
ARTICLE VII
INDEMNIFICATION
Section 7.1 Losses Defined. For purposes of this Article VII, "Losses" shall
mean any and all claims, actions, losses, liabilities, damages, fines,
penalties, costs, and expenses (including, without limitation, interest that may
be imposed in connection therewith, costs and expenses of investigation, and
reasonable fees and disbursements of legal counsel and other experts) incurred
by any Party to this Agreement as a result of claims asserted by a third party,
including a governmental
[*] Confidential Treatment Requested
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authority and a Licensee.
Section 7.2 Scope of Indemnification. Each Party (the "Indemnifying Party")
shall indemnify, defend, and hold harmless (a) the other Party, (b) its
affiliates, their directors, officers, employees, agents, and representatives,
and (c) any person claiming by or through any of them (collectively, the
"Indemnified Party") from and against any Losses which are incurred, caused, or
arise from (i) acts or omissions which cause tangible property damage or bodily
injury (including death), (ii) proprietary infringement with respect to the
Indemnifying Party's products or services, (iii) any gross negligence, fraud, or
willful misconduct of the Indemnifying Party's employees, officers, directors,
or agents, or (iv) violation of any laws, regulations or statutes.
Section 7.3 Indemnification Conditions. The provisions of this Article VII
shall only apply should (a) the Indemnified Party promptly notify the
Indemnifying Party of any such claim or action, or potential exposure to a Loss
which timeliness of such notice does not prejudice the Indemnifying Party's
ability to defend such claim or action, or potential Loss, (b) the Indemnifying
Party is permitted to control the defense and provide its approval to any
settlement, which approval shall not be unreasonably withheld or delayed, and
(c) the Indemnified Party provides its reasonable assistance to the Indemnifying
Party in regards to the claim or action, or potential claim or action.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
Section 8.1 Representations and Warranties of Genesis. Genesis represents and
warrants that:
(a) Genesis is a corporation duly organized and validly existing in and in
good standing under the laws of the state of California.
(b) The execution of this Agreement and the performance of its obligations
hereunder do not constitute a breach of any contract or agreement of
Genesis with any third party.
(c) Genesis owns or otherwise has the authority to market or otherwise
distribute the Genesis Product, and to the actual current knowledge of
Genesis, the Genesis Product does not infringe on any third party's
proprietary rights.
(d) Any and all representations and warranties with respect to the
Genesis Product, the Genesis Server and the EDI Service are exclusively
stated in the applicable Genesis license agreement. EXCEPT AS OTHERWISE
STATED IN THE GENESIS LICENSE AGREEMENT OR THIS AGREEMENT, NO OTHER
REPRESENTATIONS OR WARRANTIES, IMPLIED OR EXPRESS, ARE PROVIDED BY GENESIS
HEREUNDER, INCLUDING, BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE.
(e) Genesis hereby warrants that the EDI Service will meet the business
requirements described
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in the latest mutually agreed to Work Plans, as agreed to on [INSERT DATE],
and will function in accordance with such requirements for the term of this
Agreement. In the event that First Franklin discovers a material non-
conformity in the EDI Service, Genesis agrees, as its sole and exclusive
liability, to correct, cure, replace or otherwise remedy, at Genesis' sole
expense in a prompt and reasonable manner within sixty (60) days of written
notification by First Franklin. First Franklin agrees to cooperate and work
closely with Genesis in a prompt and reasonable manner in connection with
Genesis' correction efforts. Furthermore, should any material non-
conformity prohibit a majority of Licensees from utilizing the EDI Service
to transmit an Application as defined herein, then the Term of the Initial
Period shall be extended by the same period of time that such material non-
conformity exists, which extended period shall be mutually agreed to by the
parties hereto. Genesis shall be required to deliver to First Franklin
notice of correction of such non-conformity in compliance with Section 11.2
of this Agreement.
Section 8.2 Representations and Warranties of First Franklin. First Franklin
represents and warrants that:
(a) First Franklin is a Delaware corporation.
(b) The execution of this Agreement and the performance of its obligations
hereunder do not constitute a breach of any contract or agreement of First
Franklin with any third party.
Article IX
LIMITATION OF LIABILITY
Section 9.1 Limitation of Damages. EXCEPT FOR DAMAGES WHICH MAY BE AWARDED AS
PART OF A CLAIM FOR WHICH THERE IS A RIGHT TO: (a) INDEMNIFICATION UNDER ARTICLE
XIII BELOW (WHICH INDEMNIFICATION RIGHTS SHALL NOT BE LIMITED BY ANY PROVISION
OF THIS AGREEMENT), OR (b) DAMAGES ARISING FROM BREACH OF ARTICLE X, THE
BREACHING PARTY SHALL BE LIABLE FOR ANY ACTUAL DAMAGES CAUSED BY ITS BREACH, BUT
NEITHER PARTY WILL BE LIABLE FOR ANY PUNITIVE OR EXEMPLARY DAMAGES, OR FOR ANY
SPECIAL, INDIRECT, OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT LIMITATION,
COSTS INCURRED IN DEVELOPING AND IMPLEMENTING THE PROGRAM, LOST REVENUES, LOST
PROFITS, OR LOST PROSPECTIVE ECONOMIC ADVANTAGE) ARISING FROM OR IN CONNECTION
WITH ANY PERFORMANCE OR FAILURE TO PERFORM UNDER THIS AGREEMENT, INCLUDING AN
UNJUSTIFIED, WILLFUL, OR DELIBERATE FAILURE TO PERFORM, EVEN IF SUCH PARTY KNEW
OR SHOULD HAVE KNOWN OF THE EXISTENCE OF SUCH DAMAGES, AND EACH PARTY HEREBY
RELEASES AND WAIVES ANY CLAIMS AGAINST THE OTHER PARTY FOR SUCH DAMAGES.
ARTICLE X
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CONFIDENTIALITY
Section 10.1 Confidential Information. Genesis and First Franklin shall each
hold and shall cause their respective officers, directors, employees, agents and
advisors (collectively, "Representatives") to hold in strict confidence, unless
compelled to disclose by judicial process or by other requirements of law,
regulation, or order, or as provided herein, the material terms of this
Agreement, and all oral and written information concerning the other Party,
including without limitation such Party's products or services, and related
marketing and financial information of the Party (collectively "Confidential
Information"), which has been provided by one Party (the "Providing Party") to
the other Party (the "Receiving Party") in connection with this Agreement and
the transactions contemplated hereby
Section 10.2 Exclusions. Confidential Information shall not include any
information which (i) at the time of disclosure or thereafter is generally
available to or known by the public (other than as a result of a disclosure by
the Receiving Party or one of its Representatives in violation of this
Agreement) or (ii) is available to the Receiving Party on a non-confidential
basis from a third person who, so far as is known to the Receiving Party, is not
prohibited from transmitting the information to the Receiving Party by legal,
contractual, or fiduciary duty to the Providing Party. Each Party agrees to
maintain the Confidential Information of the other Party in secrecy and to keep
the same confidential at all times, using the same degree of care with respect
to such Confidential Information as it uses in protecting its own proprietary
information, trade secrets and similar items.
Section 10.3 Restricted Use. Each Party agrees that it will not use any
Confidential Information of the other Party for any purposes other than as
expressly permitted in this Agreement or required for performance under this
Agreement, and that it will not, without the express written consent of the
Providing Party, sell, transfer, publish, disclose, display or otherwise make
available or provide access to any Confidential Information of the Providing
Party to any person, including the Receiving Party's affiliates or other
Representatives, except as provided below in this section: provided, further,
however, that the Receiving Party may disclose or provide access to Confidential
Information to its Representatives, including affiliates, on a need-to-know
basis, so long as prior to any disclosure to any such Representative or
affiliate, the Receiving Party shall inform such Representative or affiliate of
the confidential nature of the information and that it is subject to this non-
disclosure obligation, and shall further instruct such Representative or
affiliate to treat such information confidentially.
Section 10.4 Legal Proceedings. In the event that either Party or one of its
Representatives is legally compelled (by deposition, interrogatory, request of
documents, subpoena, civil investigative demand or otherwise) to disclose any
Confidential Information, such Party shall provide the Providing Party with
prompt written notice of such demand so that the Providing Party may seek a
protective order or other appropriate remedy or waive compliance with the
provisions of this Article X. If a protective order or other remedy is not
obtained and the Providing Party has not waived compliance with these
provisions, the Receiving Party shall furnish that portion of the Confidential
Information which it is advised in writing by its legal counsel is legally
required to be disclosed and such Party shall use its best efforts to ensure
that confidential treatment be accorded to such
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Confidential Information.
Section 10.5 Return of Confidential Information. Upon termination or expiration
of this Agreement, or at any time upon request by the applicable Party, the
Receiving Party shall return to the Providing Party, upon demand, all
Confidential Information prepared by the Providing Party and will not retain any
copies, extracts or other reproductions in whole or part of such written
material. All documents, memoranda, notes and other writing whatsoever prepared
by the Receiving Party based on the Confidential Information shall be destroyed.
Notwithstanding the foregoing, however, the Receiving Party may retain such
Confidential Information and materials containing or reflecting any Confidential
Information (whether prepared by the Providing Party or the Receiving Party) as
are necessary for the conduct and proper record keeping of its business in
accordance with the Receiving Party's standard operating procedures provided the
Receiving Party continues to be bound by its obligations of confidentiality
under this Article X for a period of three years following such termination.
ARTICLE XI
GENERAL PROVISIONS
Section 11.1 Assignment. Neither Party may assign or otherwise convey this
Agreement nor any of rights (other than payments) hereunder to any third party
without the prior written consent of the other Party, which consent may not be
unreasonably withheld or delayed; provided, however, that either Party may
assign or transfer this Agreement to a successor in interest or in conjunction
with the sale of substantially all of its assets to a third party assignee with
reasonably sufficient or comparable resources to perform under this Agreement
without the prior written consent of the other Party. Any purchaser or assignee
shall be bound by the provisions hereof, and must agree in writing to abide by
the terms and conditions of this Agreement.
Section 11.2 Notices. Any notice or other communication required to be given
under this Agreement for purposes other than daily operation of the Project
shall be in writing, shall be addressed as provided below, and shall be
considered as properly given (i) if delivered in person; (ii) if sent by an
express courier delivery service which provides signed acknowledgment of
receipt; (iii) if deposited in the U.S. certified or registered first class
mail, postage prepaid, return receipt requested; or (iv) if transmitted by
telecopier or facsimile machine (upon receipt by sender thereof of evidence that
a complete transmission of such telecopy was made to the recipient thereof) and,
in such case, confirmed by a telephone call contemporaneously to the person
entitled to receive such notice or to such person's secretary, dispatching a
copy of such notice by the methods in clauses (i), (ii), or (iii), above. All
notices shall be effective upon receipt.
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If to Genesis:
Xxxx Xxxxxxxx
Genesis 2000, Inc.
0000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxx 00000
[*]
With a copy to:
Xxxx X. Anik, Esq.
Anik & Xxxxxxx Law Offices
0000 Xxxxxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxxxxx Xxxxxxx, Xxxxxxxxxx 00000
If to First Franklin:
First Franklin
0000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxxxxxxxxx 00000
Attn: Xxxx Xxxxxxx
[*]
Either Party may change its address or addressee for purposes of this Section by
providing written notice to the other Party as provided by this Section.
Section 11.3 Waiver. Either Party may, at its option, choose to delay enforcing
or waive any of its rights under this Agreement in certain circumstances, in
which case the Party does not thereby waive the same right in other
circumstances. Either Party may delay enforcing or waive any of its rights
under this Agreement without affecting any of its other rights.
Section 11.4 Severability. If any provision of this Agreement which is not
reasonably deemed by the affected Party to be material to its rights and duties
hereunder is finally determined to be unenforceable under any law, rule, or
regulation, all other provisions of this Agreement shall remain valid and
enforceable to the extent necessary to carry out the intent of the Parties.
Section 11.5 Force Majeure. Except for the obligation to make payments
hereunder, in the event
[*] Confidential Treatment Requested
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either Party is prevented from performing this Agreement by circumstances beyond
its control, including without limitation, labor dispute, fire, explosion,
flood, act of God, war or other hostilities, civil commotion, breakdown of
machinery, domestic or foreign governmental acts, orders, or regulations, or
inability to obtain facilities or supplies, the obligation of either Party to
shall be suspended during the period of such disability.
Section 11.6 Announcements. First Franklin and Genesis agree that neither First
Franklin nor Genesis shall make any publicity release, advertisement, or public
announcement concerning this Agreement or the Project without the prior approval
of the other Party, except as may be required by law.
Section 11.7 Dual Draftsmanship. This Agreement shall be deemed to have been
jointly drafted by the respective Parties hereto, and therefore at no time shall
any ambiguity of any terms or conditions of this Agreement be interpreted
against any Party to this Agreement based on a claim of draftsmanship.
Section 11.8 Entire Agreement. This Agreement, including the Attachments and
Exhibits attached to this Agreement, reflects the entire understanding between
the Parties on the subject matter hereof. Any representation, promise,
modification, or amendment to this Agreement (including such Attachments and
Exhibits), except as provided herein, shall not be binding upon either Party
unless reduced to writing signed on behalf of First Franklin and Genesis by
their duly authorized representatives.
Section 11.9 Nature of Agreement. Nothing contained in this Agreement shall be
construed as constituting or creating a partnership, joint venture, agency, or
other association or relationship between First Franklin and Genesis. To the
extent that either Party undertakes or performs any duty for itself or for the
other Party as required by this Agreement, the Party shall be construed to be
acting as an independent contractor and not as a partner, joint venturer, or
agent of the other Party. Nothing in this Agreement is intended or shall be
construed to create any rights, beneficial or otherwise, in any person not a
party to this Agreement.
Neither of the parties nor any of their employees shall have the power or
authority to bind or obligate the other Party. Except as stated herein, neither
Party shall have authority to make any monetary commitment on behalf of the
other Party or settle any dispute involving the other without the prior written
consent of the other Party.
Section 11.10 Time of the Essence. Time is of the essence with respect to the
performance of all material provisions hereunder.
Section 11.11 Headings, Captions. The article, section, and other headings and
captions contained in this Agreement are for reference purposes only and shall
not affect the meaning or interpretation of this Agreement.
Section 11.12 Counterparts. This Agreement may be executed in any number of
counterparts,
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each of which, when executed, shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument.
Section 11.13 Binding Effect. This Agreement shall inure to the benefit of and
shall be binding upon the Parties hereto and their respective legal
representatives, successors and permitted assigns.
Section 11.14 Choice of Law. This Agreement shall be construed in accordance
with the laws of the State of California.
IN WITNESS WHEREOF, the parties by their duly authorized representatives
executed this Agreement.
First Franklin Financial Genesis 2000, Inc.
By: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxx Xxxxxxxx
-------------------------- ---------------------------
Name: Xxxx X. Xxxxxxx Name: Xxxx Xxxxxxxx
------------------------ -------------------------
Title: Chief Operating Officer Title: President
------------------------ ------------------------
Date: 12/3/97 Date: 12/1/97
------------------------- -------------------------
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