*EXHIBIT 10.4
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AGREEMENT DATED AS OF SEPTEMBER 15, 1995 BETWEEN BORLAND INTERNATIONAL,
INC. AND COMPUTER GENERATED SOLUTIONS, INC.
* Confidential treatment is being requested with respect to portions of
this exhibit
BORLAND No-Nonsense VAR Agreement
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This Agreement is between Borland International, Inc., 000 Xxxxxxx Xxx,
Xxxxxx Xxxxxx, XX 00000 ("Borland"), and Computer Generated Solutions,
Inc., 0000 Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("VAR").
1. Definitions
"Products" means Borland's computer software programs listed in Attachment A,
including any related documentation ("Documentation"). "Territory" means the
country or countries listed in Attachment A.
2. License
x. Xxxxxxx hereby appoints VAR as a member of Borland's Premier VAR Program
(described in Attachment C) and appoints VAR as an authorized Value Added
Reseller of the Products in the Territory. Borland hereby grants to VAR a
limited, nonexclusive, nontransferable license to distribute and sublicense the
Products in the Territory, solely as embedded in or bundled with the value-added
software and/or application development services described in Attachment A, and
not as standalone products.
x. Xxxxxxx also hereby grants to VAR a limited, nonexclusive, nontransferable
license to use Borland's trademarks and trade names solely to the extent
reasonably necessary for, the marketing, distribution and support of the
Products, and in accordance with guidelines for the protection of such marks and
names as may be provided by Borland to VAR from time to time.
3. VAR Obligations
a. The license granted above is contingent upon VAR's payment of the annual
Premier VAR Program enrollment fee, VAR's commitment to the Annual Net Software
Revenue Performance Level set forth in Attachment B. and VAR's employment of at
least two persons who are trained and certified in the use and installation of
the Products .
b. Upon execution of this Agreement, and from time to time within 30 days of
Borland's request, VAR agrees to provide Borland with a business plan with
respect to the future activities of VAR related to this Agreement.
c. VAR agrees to provide Borland with monthly sales, pipeline and forecast
reports.
4. Payment and Reports
a. VAR will pay Borland the applicable License Fees as set forth on Attachment B
and the Premier VAR Program fees set forth on Attachment X. Xxxxxxx may change
the list price of the Products at any time without notice. Borland may change
the Premier VAR Program fees annually upon renewal.
b. Products are delivered FOB Borland's point of shipment. VAR is responsible
for paying all taxes, duties, shipping and other such fees relating to the
Products, except taxes on Borland's net income.
c. Within fifteen (15) days of the end of each calendar month, VAR shall report
to Borland (i) the number of copies of each Product distributed during such
month, (ii) the incremental number of users licensed by VAR during the month,
and (iii) the amount payable to Borland, along with payment in such amounts.
d. All other payments are due within thirty (30) days after the date of
Borland's invoice.
e. Late payments will be subject to interest at 1.5% per month, or the maximum
rate allowable by law, if less. Borland reserves the right to change VAR's
credit or payment terms if VAR does not pay in full and on time.
5. Borland Obligations
x. Xxxxxxx will accept orders from VAR for Products, provided each such order
includes (i) the number of each Product ordered; (ii) the appropriate pricing
and payments terms per the VAR Discount detailed in Attachment B; (iii) the
xxxx-to and ship-to address; (iv) a reference to this Agreement; and (v) and
other information reasonable requested by Borland.
x. Xxxxxxx will supply marketing materials for the Products as ordered by VAR in
quantity based upon Borland's then-current standard charges for these materials.
x. Xxxxxxx will work with VAR to establish product training for VAR's technical,
sales and support staff at the then-current time and rate schedule provided by
Borland or a designated third party.
6. Upgrades and Support
a. Provided VAR has paid all applicable Premier VAR Program fees as set forth in
Attachment C, VAR will be entitled to receive Upgrades to those Products which
may become commercially available from Borland during the term of this
Agreement. An "Upgrade" is a revised version of a Product with the identical
name and with a version number change immediately to either the right or
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left of the decimal. An Upgrade does not include a version of a Product for a
different operating system or environment.
b. VAR is also entitled to obtain the support and other services from Borland as
a member of the Premier VAR Program as described in Attachment C. VAR, and not
Borland, is responsible for providing VAR's customers with Upgrades and support.
Borland's support programs are subject to change from time to time without
notice.
7. Proprietary Rights
Borland or its licensers have and will keep title, copyright, trademarks and all
other proprietary rights in the Products. VAR has no right to use, examine, re-
create, sublicense, or transfer the source code for the Products, which is
Borland's trade secret. VAR agrees not to attempt to reverse engineer,
decompile, disassemble, or otherwise attempt to derive source code from the
Products or to knowingly allow others to do so during or after the term of the
Agreement. Unless agreed to in writing by Borland, VAR agrees not to remove or
destroy any proprietary or confidential legends or markings placed upon or
contained in the Products, or otherwise to modify or alter the Products.
8. Limited Warranty
Borland warrants the physical media provided to VAR (but not any media
distributed by VAR) to be free of physical defects in materials and workmanship
for a period of 90 days after it is first delivered to VAR, and will replace any
defective media if notified within the warranty period. THE FOREGOING WARRANTY
IS IN LIEU OF ALL OTHER WARRANTIES TO VAR OR ANY THIRD PARTY, EXPRESS OR
IMPLIED, RELATED TO THE PRODUCTS OR ANY SERVICES BORLAND MAY PROVIDE, INCLUDING
WITHOUT LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, OR ARISING BY STATUTE, LAW OR TRADE DEALING OR USAGE.
Without limiting the foregoing, Borland does not warrant that any Product is
error-free, or that any errors can or will be corrected. VAR agrees that it will
not make any warranty or other representation of any kind to sublicensees or
others on Borland's behalf.
9. Limitation of Liability
In any event, neither Borland nor VAR will be liable to the other or any third
party for incidental, special or consequential damages for any reason (including
loss of data or other business or property damage), even if foreseeable, and
neither party's liability will exceed the applicable fees paid or payable by VAR
to Borland. VAR will require each sublicensee to accept similar warranty and
liability limits.
10. Infringement Indemnity
x. Xxxxxxx will defend VAR against any claims by third parties of infringement
of United States copyrights arising from VAR's use, as permitted herein, of any
Product as furnished by Borland and pay any damages awarded. Borland's
obligations are contingent upon VAR notifying Borland promptly of any notice of
any actual or threatened claim or suit; giving Borland the exclusive right to
control the defense and settlement of such claim or suit; and giving Borland
VAR's full cooperation for the defense of same. Following notice of a claim or a
threatened claim, Borland may, in its discretion and at its option, procure for
VAR the right to continue using any Product or may replace or modify any Product
to make it non-infringing. If Borland determines that none of these alternatives
is practical, Borland may refund the license fees paid by VAR hereunder for the
affected Products (less a charge for depreciation on a three year, straightline
basis) and accept the return of the affected Products.
x. Xxxxxxx will have no liability for any claim of infringement of any third
party right that is caused by VAR's use of any Product with non-Borland
software, products or data if such claim would have been avoided by exclusive
use of the Product; modification of the Product by anyone other than Borland if
such claim would have been avoided by use of the unmodified Product; or by use
of other than the most current release of the Product.
c. Paragraphs (a) and (b) of this Section state Borland entire liability to VAR
for actual or claimed infringement of intellectual or proprietary rights.
11. Term
a. The term of this Agreement shall be one year and it shall be effective on the
date set forth below. The Agreement shall automatically renew for not more than
two consecutive one year terms unless 30 days' advance written notice is
provided by either party. Either party may terminate this Agreement on 30 days'
written notice if the other party breaches any material term of this Agreement
and fails to remedy such breach within such 30-day notice period. Either party
may terminate this Agreement in the event the other party becomes involved in
any voluntary or involuntary bankruptcy or other insolvency proceedings, ceases
to be actively engaged in business, makes an assignment for the benefit of its
creditors, or becomes financially incapable of fulfilling its obligations under
this Agreement.
b. Upon termination, VAR shall cease distributing and sublicensing the Products,
shall destroy or return all originals and copies of the Products, including
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documentation and related materials, and all other reproductions and parts
thereof. VAR may retain full-use copies of the Products for which it has
purchased an internal use license from Borland.
12. Audit Rights
Upon 15 days' written notice, Borland shall have the right, at all reasonable
times during normal business hours, to inspect the VAR's sites to determine
whether the Products are being used and protected in accordance with the terms
of this Agreement. In addition, upon such notice, Borland shall have the right,
during normal business hours, to conduct an audit of VAR's records to determine
the propriety of royalty reports submitted by VAR and related license fee
records. Borland shall bear the expense of such audit; however, in the event any
such audit reveals that VAR has understated the amount of fees which VAR is
obligated to pay Borland under this Agreement by more than five percent (5%),
VAR shall pay, in addition to any fees contractually due, all reasonable third
party fees associated with such audit. Audit rights shall terminate one year
subsequent to the termination or expiration of this Agreement.
13. Confidentiality
"Confidential Information" means non-public business, product, financial and
technical information which is disclosed in writing and marked as confidential,
or disclosed in any other manner and later identified in writing as
confidential. Neither party will use or disclose the Confidential Information of
the other except as specifically authorized by the other in writing. Each party
will protect the Confidential Information of the other by using the same degree
of care, but no less than a reasonable degree of care, to prevent the
unauthorized use, dissemination or publication of the Confidential Information
as such party uses to protect its own confidential information of a like nature.
14. Assignment
This Agreement shall be binding upon and inure to the benefit of each of the
parties hereto and, except as otherwise provided herein, their respective legal
successors and permitted assigns, provided however that VAR shall not assign,
voluntarily or involuntarily or by operation of law or otherwise, any part of
this Agreement without the prior written consent of Borland.
15. General
a. This is the full and final agreement between VAR and Borland on this subject,
and supersedes any earlier promises, representations or agreements.
b. This Agreement may only be changed if VAR and Borland's authorized
representative do so in writing.
c. No inconsistent, additional, or preprinted terms on VAR's purchase order or
other business form will apply.
x. Xxxxxxx reserves the right at any time without liability to change or
discontinue any of its products, services or programs.
e. VAR and Borland are independent contractors and neither is an agent, partner,
franchisee, joint venturer or employee of the other.
f. Waivers not given in writing may be revoked at any time without liability.
g. Invalid provisions do not affect the enforceability of others.
x. Xxxxxxx is entitled to injunctive relief for violations of Borland's
copyrights, trade secrets or other proprietary rights.
i. Use, duplication, or disclosure by the U.S. Government of the Products shall
be subject to the restricted rights applicable to commercial computer software
(under DFARS 252.227-7013 or FAR 52.227-19, as applicable).
j. Distribution of the Products is subject to U.S. export control laws. VAR may
not in any event export the Products to any country under U.S. Commerce
Department restriction.
x. Xxxxxxx reserves all rights not granted specifically in this Agreement. All
notices shall be in writing and in English and may be sent by telecopy, courier,
or mail, return receipt requested, sent to the attention of the Legal Department
at the addresses set forth below, and shall be deemed effective upon receipt.
l. This Agreement will be construed, interpreted and governed by the substantive
laws of the State of California. Any legal action arising out of or related to
this Agreement shall be brought only in a state or federal court of competent
jurisdiction located in the Counties of Santa Xxxx or Santa Clara, California.
BORLAND No-Nonsense VAR Agreement
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BORLAND INTERNATIONAL INC.
Signed: /s/ Xxxxx X. Xxxxxxx
--------------------------
Name: Xxxxx X. Xxxxxxx Reviewed
---------------------------- By
Legal
Title: V.P. - Sales Dept.
--------------------------- /s/ LW
EFFECTIVE DATE: 9/15/95
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VAR: Computer Generated Solutions, Inc.
Signed: /s/ Xxxxxx Xxxxxxxx
--------------------------
Name: Xxxxxx Xxxxxxxx
----------------------------
Title: Executive Vice-President
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BORLAND No-Nonsense VAR Agreement
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ATTACHMENT A
I. PRODUCTS (U.S. English language version):
Platform
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Delphi Client/Server Windows
Delphi Client/Server Bundle Windows
ReportSmith SQL Windows
II. VALUE ADDED PRODUCTS AND/OR SERVICES
The license granted in Section 2 of the Agreement is contingent upon VAR
providing to the end user the following Value Added software and/or application
services with each Product distributed: Delphi Full Project Life Cycle
Implementation Support, Training, and Supplemental Staffing. Such Value Added
services and/or products must be of equal value to the Products sold with such
services and/or products to each customer.
lll. TERRITORY
With respect to this Agreement the term Territory shall mean the United States,
Canada, and the country or countries listed below:
IV. APPROVED AGENTS AND RESELLERS
Subject to all the terms of this Agreement, The VAR's agents and resellers below
are approved by Borland to distribute the Products with the value-added software
or services described above.
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BORLAND No-Nonsense VAR Agreement
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Attachment B
I. LICENSE FEES
a. Products. VAR shall pay Borland a per copy license fee for each Product
--------
purchased under this Agreement based on a **** discount off of the then-
current suggested list price of the Product on the date VAR places each
order.
b. Upgrades. For each Product Upgrade purchased pursuant to this
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Agreement as a replacement for a prior version of such Product, VAR
shall pay Borland a per copy license fee based on a **** discount off
of the then-current Upgrade price of the Product on the date VAR places
each order.
c. International Uplifts.
----------------------
The license fee for each translated Product shall be **** of the license
fees for Products and Upgrades set forth in (a) and (b) above.
The license fee for each International English version of the Products
shall be **** of the license fees for Products and Upgrades set forth in
(a) and (b) above.
The license fee for each U.S. English language version of the Products
distributed by VAR outside the United States shall be **** of the license
fees for Products and Upgrades set forth in (a) and (b) above.
II. BORLAND ASSIST SUPPORT PROGRAMS.
VAR may accept customer purchase orders for the Borland Assist Support
Programs from VAR's customers as value-added to the Products. VAR shall
pay to Borland the price set forth in the Borland Assist Price List for
each such order.
III. PREMIER VAR ANNUAL NET SOFTWARE REVENUE OBJECTIVE
VAR agrees to maintain an Annual Net Software Revenue Performance level of
at least **** in order to participate in the Premier VAR Program as
defined under this Agreement.
IV. REBATE SCHEDULE
Each calendar quarter during the term of this Agreement, VAR is eligible
to receive a Rebate based on VAR's "Purchases to Date" (defined below)
during the one-year term of this Agreement, according to the following
schedule:
Rebate Level Purchases to Date Rebate Percentage
------------ ----------------- -----------------
I **** ****
II **** ****
III **** ****
IV **** ****
V **** ****
5
**** Confidential treatment is being requested for these portions of this
agreement.
BORLAND No-Nonsense VAR Agreement
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Purchases to Date are used to determine the Rebate percentage. To determine the
amount of Rebate, multiply the Rebate Percentage by actual "Net Revenues"
(defined below) during the quarter.
Example: If at the end of a quarter VAR's Purchases to Date are $250,500 (****),
and VAR's Net Revenues during such quarter were $50,000, VAR's Rebate for such
quarter would be calculated by multiplying $50,000 by ****, for a total Rebate
of **** for such quarter.
"Net Revenues" means the total of actual shipments of full Products that Borland
makes to VAR during a calendar quarter, calculated at the discount off the then-
current suggested list price set forth in Paragraph I above and net of return
authorizations issued, taxes, shipping and other charges and credits. Net
Revenues does not include Upgrades.
"Purchases to Date" means the sum of (i) Net Shipments to date under each one-
year term of this Agreement plus any order(s) placed by VAR during the quarter
which have not yet been shipped by Borland, provided such orders are for
Products currently available for shipment by Borland and scheduled for immediate
shipment, and provided such orders are not being held because VAR is on credit
hold; (ii) any Upgrades ordered to date under this Agreement, less returns; and
(iii) any orders placed by VAR for Borland Assist under Paragraph II above.
REBATE TERMS AND CONDITIONS.
Rebates will be awarded within approximately 30 days after the end of each
calendar quarter. Borland will calculate Rebates based on the reports received
electronically each month from VAR. Borland will award the Rebate as a reduction
against the current balance due Borland from VAR. If no balance is due at the
time of the award, VAR may elect to receive the Rebate in the form of a cash
payment or as a credit against future payments for Product to Borland. In the
event VAR believes any Rebate is incorrect, VAR must notify Borland of such
claim in writing in detail, within 5 days of receipt of such award. In the event
Borland does not receive such notice, the Rebate will be deemed accepted by VAR.
In the event VAR disputes any Rebate award, VAR's management and Borland's will
meet to attempt to resolve the dispute, but the final award of any Rebate will
be determined in Borland's sole discretion. In no event will any disputed Rebate
be deducted from payments due to Borland unless and until such Rebate award has
been agreed to in writing by VAR and Borland. No Rebate will be credited or
paid if VAR is on credit hold, but only for so long as such credit hold is in
place.
If VAR and Borland terminate this Agreement prior to the end of any calendar
quarter, Borland will credit any Rebate earned toward any outstanding balance
due Borland unless there is no balance, in which case Borland will award the
Rebate in cash.
6
**** Confidential treatment is being requested for these portions of this
agreement.
BORLAND No-Nonsense VAR Agreement
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ATTACHMENT C
PREMIER VAR PROGRAM
I. DELPHI CLIENT/SERVER ANNUAL PROGRAM ENROLLMENT FEE: **** per Year, ordered
separately by purchase order.
II. PROGRAM DELIVERABLES
Software (for VAR's internal use only)
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. 2 Copies of Delphi Client Server (Full Use) with Documentation
. 2 Copies of ReportSmith SQL (Full Use) with Documentation
. Right to Copy up to ten (10) copies of DELPHI Client/Server and
ReportSmith SQL to be used for internal education and demonstration
purposes only.
. Additional copies: Delphi: **** ea. ReportSmith SQL: **** ea
Documentation: DELPHI - **** set ReportSmith SQL - **** set
Software Upgrades (for VAR's internal use only)
-----------------------------------------------
. Included with Annual Premier Program Enrollment Fee
Borland Assist Telephone Support
--------------------------------
The program includes consultative and Client/Server connectivity support for
Delphi, Local InterBase Server and ReportSmith SQL.
PRIORITY SUPPORT DELIVERABLES ARE:
. 2 Named Contact(s)
. **** for each Additional Contact
. Immediate Call Response
. Unlimited Priority Access to a Senior Support Engineer via a Toll
Free number.
. Borland KnowledgeBase XX
Xxxxxxx Assist Telephone Support hours are Monday through Friday, 6 a.m. -
5 p.m. PST, not including holidays.
7
**** Confidential treatment is being requested for these portions of this
agreement.
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MICROSOFT SOLUTION PROVIDER AGREEMENT
This Agreement (the "Agreement") is between Microsoft Corporation ("MS"), a
Washington corporation, located at Xxx Xxxxxxxxx Xxx, Xxxxxxx, XX 00000, and
you, the Microsoft Solution Provider ("SP"). DO NOT ALTER OR AMEND THIS
AGREEMENT IN ANY MANNER; such alterations, without MS written accceptance,
will void this Agreement.
1. PURPOSE
SP desires to provide a comprehensive computer solution to certain of its
customers, which may include computer hardware, software, product support, and
training. MS desires to supply software, service, and/or support to SP to enable
SP to provide its customers with the solutions above.
2. APPOINTMENT
MS hereby appoints SP as a non-exclusive Microsoft SP in the U.S., excluding
U.S. territories, for the services and training listed in this Agreement.
3. TERM AND TERMINATION
This Agreement shall take effect on date of SP's signature below ("Effective
Date"), and unless terminated earlier as provided herein, shall continue for one
year, terminating on the last day of the month the Agreement was signed in that
following year. Either party shall have the right to terminate this Agreement at
any time, without cause, on the giving of thirty (30) days prior written notice.
Neither party shall be responsible to the other for any costs or damages
resulting from the termination of this Agreement. Upon expiration or termination
of this Agreement, SP shall immediately cease use of all training licenses,
internal use licenses, MS trademark, and MS Solution Provider Logo, and cease to
represent itself as an MS Solution Provider.
4. PAYMENT TERMS
Fee for this appointment is One Thousand Five Hundred Dollars ($1,500).
5. SP OBLIGATIONS
(A) TRADEMARKS
The appropriate trademark symbol (either "TM" [standard Trademark] or "(R)"
[standard Registered] in a superscript following the Product name) shall be used
whenever a MS product name is mentioned in any advertisement, brochure, or
material circulated by SP. The appropriate trademark symbol must be used at
least once for each MS product in each publication, in conjunction with the
first reference to such MS product.
(B) REPORTING
Quarterly sales and service reports, in a format to be prescribed by MS, shall
be completed and forwarded to: Attn.: Microsoft Solution Provider Group--
Reporting, Microsoft Corporation, Xxx Xxxxxxxxx Xxx, Xxxxxxx, XX 00000-0000.
Format and further information will be provided to SP by MS.
(C) MEMBERSHIP APPLICATION
SP represents and warrants that all the information it supplied on its
Membership Application is in all material respects true and correct to the best
of its knowledge and belief, and undertakes that it will continue to be so
during the term of this Agreement. Should there be any changes in such
information during the course of this Agreement, SP shall promptly inform MS in
writing of such changes.
(D) SERVICE ESTIMATE
SP's best estimate is that more than 25% of its revenues are generated from
provision of technical services to its customers. This estimate shall not
include those services, support, training, etc. provided to any of SP's
affiliates, subsidiaries, branches, divisions, or other related third parties.
6. SP PROGRAM FEATURES
(A) LOGO USAGE
SP shall have the right to use the MICROSOFT SP LOGO provided that (i) SP
insures that all services it provides as a Microsoft SP are consistent with the
quality of skills acquired by those employees of the SP who have obtained the
appropriate training from MS or its affiliates; (ii) SP continues to employ a
sufficient number of people who are Microsoft Certified Professional personnel;
(iii) SP complies with guidelines for use of the MICROSOFT SP LOGO as prescribed
by MS from time to time; and (iv) SP is in full compliance with the terms and
conditions of this Agreement. In the event that any of the above provisions are
not met, SP will cease immediately from use of the MICROSOFT SP LOGO.
MICROSOFT/R/
SOLUTION PROVIDER
