EXHIBIT 10.26
CONFIDENTIAL
TEAMING AGREEMENT
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THIS AGREEMENT made the 19th day of August, 1997
BETWEEN: DCX SYSTEMS LTD., a corporation incorporated under the laws of Canada,
having its principal place of business at 0000 Xxxxxxxx Xxxx Xxxxx,
Xxxxxxx Xxxxx, Xxxxxxx, X0X 0X0,
(hereinafter referred to as "DCX")
AND: XXXX CANADA, a corporation incorporated under the Canada Business
Corporations Act, having its principal place of business at 0000
Xxxxxx Xxxx Xxxx, Xxxxxxxx, Xxxxxx, Xxxxxx, X0X 0X0,
(hereinafter referred to as "BELL")
WHEREAS BELL has issued a Request for Quotation # 121960719 dated July 12th,
1996 (hereinafter the "Request for Quotation");
WHEREAS DCX has presented a Proposal dated August 13th, 1996 with respect to the
Request for Quotation (hereinafter the "Proposal");
WHEREAS the parties have signed a Letter of Agreement dated January 30th, 1997
(the Letter of Agreement) attached hereto as Appendix "A" under which they
have agreed to proceed with a Field Trial to test the Derived Channel System
(the Field Trial);
WHEREAS the parties have subsequently entered into negotiations with respect to
the implementation of a Derived Channel Multiplex Network used to provide data
over voice services in XXXX'x territory in Quebec and Ontario;
WHEREAS the parties wish to establish their respective rights and obligations
and the method of sharing the financial benefit that may arise from the
recurring revenues generated by the Derived Channel Multiplex Network as stated
herein.
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NOW THEREFORE WITNESSETH that, in consideration of the premises and the terms,
conditions and mutual covenants and agreements herein contained, and for other
good and valuable consideration the receipt and adequacy of which is hereby
acknowledged, the parties hereto agree as follows:
1 INTERPRETATION
1.1 Definitions
1.1.1 The following terms used in this Agreement shall have
the definitions respectively assigned to them
hereunder unless the subject matter or context of
this Agreement otherwise requires:
1.1.1.1 "AGREEMENT" shall mean this Agreement.
1.1.1.2 "CUSTOMER OF BELL" shall mean the person
or entity that is subscribing to the
Services, said Services as are further
described in Section 2.3.
1.1.1.3 "DERIVED CHANNEL CONNECTION" shall mean
each port used in the scanner comprised in
the Equipment provided by DCX and owned by
BELL and used by a customer of BELL within
Quebec and Ontario.
1.1.1.4 "DERIVED CHANNEL MULTIPLEX NETWORK" shall
mean the message switches, scanners and
other related equipment, including software,
used to provide alarm and other data over
voice transport services.
1.1.1.5 "INTELLECTUAL PROPERTY" shall mean
anything protected or that may be protected
by Intellectual Property Rights and
includes, without limitation, inventions,
methodologies, software, processes, know-how
and technical information.
1.1.1.6 "RECURRING REVENUE" shall mean the monthly
amount invoiced by BELL to its Customers for
each Derived Channel Connection, excluding
taxes and one time service charges.
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1.1.1.7 "NPV" shall mean the Net present value
(evaluated at day one of the Term of this
Agreement) of the amount where indicated and
is calculated using a discount factor of
11.1 % of capital cost.
1.2 All amounts stipulated in this Agreement are in Canadian (CDN)
dollars.
2 OBJECT
2.1 The Preamble forms part of this Agreement.
2.2 DCX hereby agrees to sell to BELL and XXXX hereby agrees to
buy from DCX, Derived Channel Multiplex Network software and
firmware as further described in Section 3.1, the whole under
the terms and conditions and for the consideration stipulated
herein.
2.3 BELL shall use Derived Channel Multiplex Network to provide
alarm and other data over voice transport services
(hereinafter referred to as the "Services").
2.4 The Services will be offered to XXXX'x Customers located in
its operating territory, in Quebec and Ontario.
2.5 The Services will be provided over XXXX'x network and
equipment.
2.6 This Agreement is strictly conditional upon the successful
completion of the Field Trial by DCX in accordance with the
terms and conditions of the Letter of Intent. Following such
successful completion, the provisions of the Letter of Intent
shall become inapplicable and will be deemed replaced by this
Agreement. Should the Field Trial not meet the criteria
specified in the Letter of Intent, this Agreement shall become
null and void and of no further effect.
3 OBLIGATIONS OF DCX
3.1 DCX hereby agrees to sell to BELL the Derived Channel
Multiplex Network software and firmware listed in Appendix
"B" attached hereto and all other additional components as
BELL may require from time to time during this Agreement to
provide the Services (the equipment listed in Appendix "B",
together with any additional components being collectively
referred to herein as the "Equipment").
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3.2 DCX hereby grants to BELL a non-exclusive, transferable,
ongoing, paid up license to use the programs and the software
(in object-code only) installed or comprised in the Equipment,
regardless of whether DCX is providing the maintenance support
services or not. This license shall survive the termination or
expiry of the Term of this Agreement.
3.3 DCX will stock an adequate supply of Equipment, parts and
components to fully support XXXX'x demand.
3.4 DCX will ship the Equipment at its own risks and expenses to
BELL as per the deployment schedule of Appendix "C" attached
hereto (the Deployment Schedule) and as reasonably ordered
from time to time by BELL in a Purchase Order specifying the
exact quantity, delivery date and location. Should DCX fail to
timely deliver Equipment as ordered by BELL, such failure
shall constitute material breach under the provisions Section
18.1 below.
3.5 As stated in Section 3.1 above, DCX will provide equipment in
addition to that listed in Appendix "B" and will also effect
delivery thereof as may be required from time to time by BELL.
Such additional equipment shall be governed by the terms and
conditions of this Agreement.
3.6 DCX warrants that the Equipment will be free from defects in
material and workmanship upon delivery and will perform
according to the specifications detailed in the Proposal
throughout the Term of this Agreement.
3.7 DCX warrants it is the rightfull owner of the Equipment with
the right to license the software and warrants that Equipment
will be free and clear form any lien and encumbrances.
3.8 DCX will provide at no additional cost, "Premium
Network/Support Package" maintenance services for the
Equipment as specified Appendix "D" attached hereto. When
access to XXXX'x premises or third parties premises is
required by DCX to effect maintenance services, it shall be
strictly in accordance with all procedures established from
time to time by BELL, namely, BELL reserves the right to limit
access to specific individuals, to request appropriate
identification and to schedule such activities at certain
times such as during off normal hours designated by BELL.
3.9 DCX represents to BELL that it has developed and will
constantly update a modernization plan for future developments
of the Derived Channel Multiplex
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Network, including a plan to modernize the current main
scanner technology within two (2) years from the signature
of this Agreement. If deemed appropriate by BELL and DCX,
DCX will replace or upgrade the current scanner technology
with the new scanner technology, when it is available, the
whole, at its own costs and expenses, except that
installation will be assumed by BELL but paid for by DCX.
3.10 DCX warrants all Equipment shall comply with all applicable
laws, regulations and standards, namely, but without
limitation, U.L.C., C.S.A. and NFPA-72.
3.11 DCX will provide twenty-five (25) training sessions and all
necessary documentation as specified in the Proposal.
3.12 DCX will provide BELL with all documentation and
manufacturer's specifications (in French and English)
necessary for the installation and operation of the Equipment.
3.13 DCX will provide a standard solution acceptable to BELL by the
end of July 1998 to provide the Services with the DMS-IU; in
order to do so, DCX will need data and information from
Nortel, the details of which it will provide to BELL by the
end of September 1997. BELL will take reasonable steps to
ensure Nortel is cooperating in providing such requirements to
DCX. Should the DMS-IU solution not be made available to BELL
by the end of July 1998, in spite of Nortel's collaboration,
the number of Derived Channel Connections contemplated in
Section 5.1 will be modified from 52,000 to 32,000.
3.14 DCX will make available from alarm panel suppliers (including
DSC Sur-Gard) the STU's and Line Card receivers on the later
of ninety (90) days following signature of this Agreement, or
thirty (30) days following the last day of the Field Trial.
3.15 DCX also grants BELL the right to rent ports or otherwise
allow use of ports on the switches comprised in the Equipment
to any Canadian Telephone Company who has purchased network
equipment from DCX. Such rental or use shall be under terms
and conditions as BELL may determine appropriate from time to
time, it being understood that the revenues (if any) that BELL
may receive therefrom are not to be considered for the purpose
of calculating the Retribution described in Section 7 herein.
3.16 DCX represents and warrants that each equipment and software
delivered or developed under this Agreement is designed to be
used prior to, during, and after the calendar year 2000 A.D.
and that the Equipment delivered or developed under
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this Agreement will operate during such time period without
error relating to date data, specifically including any
error relating to, or the product of, date data which
represents or references different centuries or more than a
century.
Without limiting the generality of the foregoing, DCX further
represents and warrants that the Equipment:
A) will not abnormally end or provide invalid or
incorrect results as a result of date data,
specifically including date data which represents or
references different centuries or more than one
century;
B) has been designed to ensure year 2000 compatibility,
including, but not limited to, date data century
recongnition, calculations which accomodate same
century and multi-century formulas and date values,
and date data interface values that reflect the
century; and
C) includes "year 2000 capabilities". "Year 2000
capabilities" means the Equipment:
i) will manage, calculate, sequence, compare
and manipulate data involving dates,
including single century formulas and
multi-century formulas, including leap years
and will not cause an abnormally ending
scenario within the application or generate
incorrect values or invalid results
involving such dates; and
ii) provides that all date-related user
interface functionalities and data fileds
include the indication of century; and
iii) provides that all date-related data
interface functionalities include the
indication of century.
If requested to do so by BELL, DCX will, from time to time
provide BELL with the results of testing done by DCX on the
Equipment to verify that the Equipment is Year 2000 compliant
in accordance with the terms of this warranty. Should the
results of testing reveal that the Equipment is not Year 2000
compliant in accordance with the terms of this warranty, DCX
shall, without charge to BELL, repair or replace the
non-compliant Equipment within the period of time to be
specified by BELL; should such repair or replacement be not
completed within the time specified, BELL shall have the right
to have any necessary changes or repairs performed itself and
the DCX shall reimburse BELL for any expense incurred thereby.
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In the event of a breach of the Year 2000 warranty herein, and
notwithstanding anything to the contrary in this Agreement,
DCX shall assume all risks and responsibilities inherent to
such warranty and shall indemnify and save harmless BELL and
its customers from and against any and all claims, demands,
suits, actions, or causes of actions, of any kind whatsoever,
for direct or indirect damages, losses, costs, injuries,
death, property damage, claims and/or expenses resulting from
this Agreement, and shall also include all judiciary and
extra-judiciary costs incurred by BELL arising from such
breach.
4 OBLIGATIONS OF BELL
4.1 BELL shall provide Central Office or other space as required
for the installation and operation of Equipment.
4.2 The size and location of the area in the Central Offices or
elsewhere is within the sole discretion of XXXX and XXXX may
relocate or rearrange the Equipment from time to time at its
discretion and for any reason.
4.3 BELL shall provide the necessary electrical power to operate
the Equipment and the necessary cabling between the scanner
and XXXX'x frame. Power requirements are as specified in the
Proposal.
4.4 BELL shall test, configure, install and operate the Equipment.
4.5 Subject to the provisions of Section 3.8, BELL shall maintain
the Equipment.
4.6 BELL will act as the only interface for the Services with its
Customers and will be responsible for Services ordering, and
Services billing.
4.7 In a manner consistent with the strategy conveyed in the
Deployment Schedule, BELL will file to the CRTC, no later than
the end of 1997, a request to discontinue its Class A and B
offerings or to remove the alarm application from class A and
B offerings, and it will file to the CRTC, no later than the
end of 1998, a request to raise the tariffs of the S-3T3 Data
Services (DVAC S). However, BELL does not make any warranty or
representation to DCX as to the issue of such requests to the
CRTC.
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5 TERM
5.1 Subject to the provisions of Section 3.13, this Agreement
shall be for a term starting upon its execution by both
parties and terminating on the last day of the 48th month
following the moment a total of 52,000 Derived Channel
Connections are achieved, (the Term);
5.2 For the purpose of calculating the number of achieved Derived
Channel Connections in Section 5.1 above, in addition to the
number effectively achieved, a number of 1,000 Derived Channel
Connections will be deemed to have been achieved for each week
during which the STU's and Line card receivers are not
available from alarm panel suppliers (including DSC Sur-Gard)
on the later of ninety (90) days following signature of this
Agreement or thirty (30) days following the last day of the
Field Trial. However, the number of Derived Channel
Connections deemed achieved hereunder shall not be considered
for the purpose of payments to DCX under Section 7.
5.3 Sixty (60) days prior to the expiry of the Term, the parties
shall either:
5.3.1 enter into good faith negotiations to determine the
terms and conditions applicable to an eventual
renewal thereof and revenue sharing arrangement on a
basis that fairly acknowledges the respective
contribution of each of the parties. or,
5.3.2 mutually agree not to renew this Agreement, in which
case this Agreement will terminate at the expiry of
the Term and BELL will remain the absolute owner of
the Equipment.
5.4 Should the parties fail to reach an agreement on mutually
acceptable renewal terms and conditions at least ten (10) days
prior to the expiry of the Term (or at a later date agreed to
in writing), the matter will be referred to arbitration as per
the provisions of Section 14.2 herein whereby, however, the
arbitrators will only act as "amiable compositeurs" and
issue a non-binding recommendation (the Recommendation)
accompanied by an agreement reflecting the Recommendation.
5.5 Within ten (10) days from the date of the Recommendation,
should one of the parties not have executed the agreement
reflecting said Recommendation, it shall be deemed to have
rejected renewal and the following shall apply:
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5.5.1 If rejection is attributable to DCX, then this
Agreement will terminate at the expiry of the Term
and BELL shall remain the absolute owner of the
Equipment.
5.5.2 If rejection is attributable to BELL, then, BELL
shall remain the absolute owner of the Equipment and:
5.5.2.1 If a total of $ * Millions NPV or more has
been paid to date to DCX under the
provisions of Section 7 of this Agreement,
BELL will, at its discretion, either:
i) pay *% of the Recurring
Revenue for one additional term
of one year, up to a maximum of
$ * Millions for that year; or,
ii) pay *% of the Recurring Revenue
for five (5) additional terms
of one year, and DCX shall
provide, free of charge to
BELL, maintenance services and
support as per the "Premium
Network/Support Package"
(Appendix "D") herein and
shall contribute in R. & D.
Activities as described in
Section 9, in the amount of $1
Million per year.
5.5.2.2 If the total of $ * Millions NPV has not
been paid to DCX to date under the
provisions of Section 7 of this Agreement
and DCX has supplied at least a value of $ *
Millions NPV in Equipment, maintenance
services, administration, sales support and
training, then the provisions of said
Section 7 shall continue to apply until the
amount of $ * Millions NPV is reached and,
after, BELL will continue to pay *% of the
Recurring Revenue for one additional term of
one year, up to a maximum of $ * Millions
for that year.
5.5.2.3 If the total of $ * Millions NPV has not
been paid to DCX to date under the
provisions of Section 7 of this Agreement
and DCX has supplied less than a value of
$* Millions NPV in Equipment, maintenance
services, administration, sales support and
training, then the amount of $ * Millions
NPV to be reached will be reduced to a new
amount according to the following formula:
* Confidential information which has been omitted pursuant to Rule 24b-2
under the Securities Exchange Act of 1934 and filed separately with the
SEC.
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$Value of Equipment, maintenance
Services, administration, sales support
And training supplied by DCX
_______________________________________ X $ * Millions NPV = new amount
$ * Millions NPV
and the provisions of Section 7 shall
continue to apply until such time as
this new amount is reached and after,
BELL will continue to pay *% of the
Recurring Revenue for one additional
term of one year, up to a maximum of $ *
Millions for that year.
5.6 Notwithstanding the provisions of Sections 5.3, 5.4 and 5.5
above, it is expressly understood that, at the end of the
Term, should BELL determine that the Derived Channel Network
technology offered by DCX will not meet its future
requirements, then BELL may go to tender to identify a
preferred supplier capable of providing the Services
throughout the entire BELL territory and, if BELL selects
another supplier, then, provided DCX has been invited to
tender and further provided that the other supplier offers
technology able to coexist with voice over any kind of
transport medium; then:
5.6.1 BELL will remain the absolute owner of the Equipment;
and
5.6.2 XXXX'x only obligation shall be to pay the following
percentages of Recurring Revenue to DCX up to and
until the time BELL decides to disconnect the
Equipment:
Year 6 = *%
Year 7 = *%
Year 8 = *%
Year 9 = *%
Year 10 = *%
but in the aggregate, not to exceed a maximum amount
of $ * Millions NPV; or the "new amount", as
defined in Section 5.5.2.3, if DCX has supplied less
than a value of $ * Millions NPV in Equipment,
maintenance services, administration, sales support
and training.
* Confidential information whch has been omitted pursuant to Rule 24b-2
under the Securities Exchange Act of 1934 and filed separately with the
SEC.
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5.7 For the purpose of calculating the value in Equipment,
maintenance services, administration, sales support and
training supplied by DCX under Sections 5.5.2.2., 5.5.2.3 and
5.6.2., the prices shown in the Proposal shall remain
applicable throughout the Term and, within thirty (30) days
following the end of each fiscal year of BELL, DCX shall
provide BELL with a statement showing the dollar value
respectively attributable to Equipment, maintenance services,
administration, sales support and training supplied during
that year.
5.8 Subject to the provisions of 5.5.2.1 ii), DCX agrees to
provide maintenance services as may be required by BELL for
the prices shown in Appendix "D", during any additional term
of this Agreement where BELL continues paying a Revenue to DCX
under this Section 5.
6 EQUIPMENT TITLE AND RISKS
6.1 Title to the Equipment shall pass to BELL upon delivery.
6.2 Risks of loss or damage to the Equipment shall be assumed by
BELL upon transfer of title.
7 PAYMENTS TO DCX
7.1 In consideration for the benefits derived from this Agreement,
BELL shall pay DCX an amount equal to * (*%) of the Recurring
Revenue (less PST and GST) received from its customers for
each Derived Channel Connection (the Retribution) during the
term of this Agreement.
7.2 The parties acknowledge and agree that the following
percentages represent a fair allocation of the Retribution for
accounting and tax purposes:
i) Equipment 77%
Maintenance Services 7%
Administration, sales
support and training 16%
---
Total 100%
* Confidential information which has been omitted pursuant to Rule 24b-2
under the Securities Exchange Act of 1934 and filed separately with the
SEC.
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7.3 The Retribution will be payable quarterly in arrears, less all
applicable withholding for payments to non-residents of Canada
as determined by Canadian and provincial legislation.
7.4 The parties will put in place a mutually acceptable connection
tracking system using a software provided by DCX and able to
identify separately two types of connection: i) residence ii)
business. The Retribution will be calculated quarterly based
on the numbers shown by such system.
7.5 Within thirty (30) days from the end of each quarter of the
term, BELL shall send to DCX copy of a report originating from
the tracking system, indicating the basis for calculation of
the Retribution and the corresponding Retribution payment.
7.6 BELL will apply a monthly rate of $11.95/connection for
residential customers and of $14.95/connection for business or
commercial customers. XXXX may modify these rates, at its
discretion, at any time during the Term or renewal of this
Agreement, in which case, BELL will advise DCX thirty (30)
days in advance.
8 SALES AND MARKETING SUPPORT
8.1 BELL and DCX will actively cooperate and participate in the
promotion and marketing of the Services as follows:
8.1.1 DCX will hire and keep the necessary number of
employees dedicated on a full time basis to market
the Services in XXXX'x territory. At least one of
these employees will speak french for Quebec
customers.
8.1.2 BELL and DCX shall equally share the expenses related
to expositions seminars and trade shows; however DCX
will provide the kiosk.
8.1.3 BELL and DCX shall jointly approach potential
customers for all Derived Channel Network
applications but BELL shall be the sole supplier of
the Services.
9 ONGOING RESEARCH AND DEVELOPMENT
9.1 DCX agrees to provide the resources to meet with customers to
evaluate applications opportunities other than alarms.
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9.2 DCX shall invest into Research and Development (R & D) an
amount sufficient to develop multiple applications (allowing
more than one application to be rerouted to more than one
control or monitoring center) and to make them available to
XXXX'x customers for field trial within one hundred and eighty
(180) days following the moment BELL and DCX agree on a
defined application.
9.3 DCX will invest in other R & D activities such as the
elimination of the 2.8 kHz tone generated by a transaction as
a priority project; "100 bytes" transaction and "switch
increased productivity" will be prioritized according to
development plans to be separately agreed upon between BELL
and DCX.
9.4 Should BELL decide to financially participate with DCX in R &
D Activities, the terms and conditions governing such
participation will be agreed upon between BELL and DCX in a
separate agreement and BELL shall be entitled to share
revenues therefrom with DCX and to exploit the results of the
R & D Activities.
10 TECHNOLOGY COMMITTEE
10.1 Each party shall appoint at least one representative to
participate in regular technology meetings held no less than
every six (6) months throughout the Term (the Technology
Committee).
10.2 The Technology Committee will work on a regular basis to
explore the technology requirements for the future.
11 FIRST RIGHT OF REFUSAL
11.1 Before accepting an offer by a third party (other than a
corporation which is an affiliate within the meaning of the
now current Business Corporations Act) to acquire the whole
of its business of providing the Services to its Customers,
BELL shall offer DCX to acquire the same, under the same
terms and conditions as offered by such third party, by
sending a notice to that effect to DCX. Failure by DCX to
accept such offer within ten (10) days of its date shall
constitute conclusive evidence of its rejection by DCX and
DCX will have no further first right of refusal.
11.2 The above first right of refusal is strictly conditional upon
its compliance, now and in the future, with all applicable
laws, rules and regulations, namely, but without limitation,
the orders of the CRTC.
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12 OWNERSHIP OF INTELLECTUAL PROPERTY
12.1 All Intellectual Property developed by a party prior to this
Agreement belongs to that party.
12.2 It is understood and agreed that any Intellectual Property
developed by one of the parties under this Agreement, shall
belong to the party that developed it.
13 SUBCONTRACTING
13.1 Provided it has obtained the other party's approval, which
shall not be unreasonably withheld and shall not be necessary
for BELL with regards to the installation of the Equipment,
each party may subcontract to a third party the performance of
all or a part of the obligations to be performed by such party
under this Agreement, but this party shall at all times remain
liable towards the other parties for all its obligations under
this Agreement.
13.2 Each subcontractor that may become so involved shall sign a
statement in writing satisfactory to the parties to the effect
that it agrees to be bound by the Confidential Information
provisions of this Agreement.
14 DISPUTES RESOLUTION
14.1 Negotiation of the parties
The parties agree that they shall use their best efforts to
settle amicably disagreements arising from or in connection
with this Agreement. To this effect, they shall submit such
disagreements to a committee constituted by the parties to be
comprised of an equal number of senior management
representatives or their duly appointed nominees, from each
party (the "Executive Committee"), the members of which
shall consult and negotiate with one another in good faith an
understanding to reach a just and equitable solution.
14.2 Arbitration
Subject to the provisions of Section 5.4, any dispute which
cannot be resolved through negotiation between the parties,
will be definitely resolved through binding arbitration to the
exclusion of the Courts, submitted to an arbitration panel of
three members, in the following manner.
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14.2.1 at the request of one party, each party shall appoint
one arbitrator, and the two such appointed shall
appoint a third arbitrator.
14.2.2 if one of the parties fails to appoint an arbitrator
within thirty (30) days of having been notified by
the other party to do so, or if the arbitrators fail
to agree on the choice of the third arbitrator within
thirty (30) days after their appointment, a judge
having jurisdiction shall make the appointment on the
motion of one of the parties;
14.2.3 the arbitrators shall proceed to the arbitration
according to the procedure they shall determine. They
shall have all the necessary powers for the exercise
of their jurisdiction, including the power to appoint
an expert and the power to act as amiable
compositeurs;
14.2.4 the arbitrator shall settle any procedural matter in
the dispute according to the rules of law agreed by
the parties or, failing which, according to the rules
of Civil Procedure applicable in the Province of
Quebec;
14.2.5 an arbitration will only take place in the City of
Montreal, in the Province of Quebec;
14.2.6 the arbitrators shall have jurisdiction to determine
the award, including payment of damages, interest and
costs;
14.2.7 every decision of the arbitrators, including the
final award, shall be rendered by the majority of
votes;
14.2.8 unless permitted by the court having jurisdiction, no
arbitral ruling or decision made by the majority of
arbitrators shall be questioned, reviewed or
restrained by any proceeding, under any act, unless
as otherwise permitted under the law, and both
parties agree to be bound by any such decision or
award; and
14.2.9 the parties agree to comply with any final award
within thirty (30) days after it is rendered.
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Notwithstanding anything provided above, nothing shall prevent any party to
petition or otherwise apply to a judge or a court having jurisdiction to seek
injunctive relief in the event of any breach of this Agreement as to provision
dealing with Intellectual Property or confidentiality, without prejudice to any
other remedy available to such a party.
15 REPRESENTATIONS AND WARRANTIES
15.1 Each of the parties represents and warrants that:
i) it has the rights to enter into this Agreement;
and,
ii) it will not, to its best knowledge, infringe upon the
Intellectual Property Rights of any person or entity
by fulfilling its obligations under this Agreement.
16 INSURANCE
16.1 DCX shall, at its sole cost and expense procure, maintain, pay
for and keep in force insurance as specified in paragraphs
16.2 and 16.3, placed with insurance companies acceptable to
BELL.
16.2 Comprehensive general liability coverage on an occurrence
basis in an amount of $10 millions combined single limit for
bodily injury and property damage. Said coverage shall include
contractual, owners and contractors protective,
products/completed operations, occurrence property damage,
personal injury and contingent employer's liability
endorsements, a cross liability clause, name BELL as an
additional named insured and contain a severability of
interests clause.
16.3 Umbrella/Excess Liability coverage in an amount of $5 millions
excess of coverage specified in 16.2 above.
16.4 The limits set forth in paragraphs 16.2 and 16.3 may be
increased by BELL from time to time during the term of this
Agreement to at least such minimum limits as shall then be
customary in respect of comparable situations.
16.5 All policies purchased by DCX shall be deemed to be primary
and not contributing to or in excess of any similar coverage
purchased by BELL.
16.6 All insurance must be in effect on or before the beginning of
the Term and shall remain in force throughout the Term and
renewal thereof. If DCX fails to maintain
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the coverage, XXXX may pay the premiums therein and obtain
reimbursement of same from DCX.
16.7 DCX shall submit certificates of insurance and/or copies of
policies reflecting the coverages specified in paragraphs 16.2
and 16.3 above prior to the beginning of the Term, to the
address shown below. DCX shall arrange for BELL to receive
thirty (30) days advance notice of cancellation or any
material change to DCX insurance policies from its insurance
company.
16.8 DCX must also conform to the recommendation(s) made by XXXX'x
insurers and Fire & Safety protection consultants which DCX
has already agreed to or to such recommendations it shall
hereafter agree to.
16.9 Failure by DCX to comply with the provisions of this Section
will be deemed a material breach of this Agreement.
17 REGULATORY APPROVAL
17.1 This Agreement and all rates, charges, terms and conditions
are subject to all applicable regulatory approvals and
requirements.
18 TERMINATION
18.1 In the event that one of the parties becomes insolvent or
bankrupt, the other party shall be entitled to terminate this
Agreement.
18.2 Upon termination of this Agreement under Section 18.1, BELL
will remain the absolute owner of the Equipment.
18.3 In the event that one of the parties to this Agreement is in
breach of a material provision of this Agreement and such
breach is not adequately remedied within thirty (30) days of
receipt of written notice of the material breach, then final
rdesolution of the breach shall be submitted to binding
arbitration.
19 WARRANTY AND INDEMNIFICATION
19.1 Neither party shall be liable to the other for any indirect,
incidental, consequential or special damages arising out of or
in connection with this Agreement even if notified of the
possibility of such damages.
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19.2 Each party indemnifies the other party in respect of any
claims for personal injury or death, or property damage
(including damage to property of the indemnified party)
arising from any act or omission of the indemnifying party,
its servants, agents, or employees.
19.3 Without restricting the generality of Section 19.2, and
notwithstanding any other provisions in this Agreement, and
unless such is the direct result of XXXX'x negligence or
willful act or that of its employees, agents or
representatives, DCX shall:
19.3.1 Indemnify and save harmless BELL, its directors,
officers, employees and agents from and against any
and all manner of liabilities awards, claims,
demands, suits, proceedings, actions, causes of
actions or other claims which may be brought or made
against BELL or such persons, or which BELL or such
persons may become subject to;
19.3.2 be liable to BELL, its directors, officers, employees
and agents for any and all losses, costs, damages and
expenses whatsoever (and without limiting the
generality of the foregoing any direct losses, costs,
damages and expenses of BELL or such persons,
including costs as between a solicitor and its own
client) which BELL or such persons may sustain, pay
or incur;
as a result of, arising out of, or in connection with:
19.3.3 the performance of this Agreement or the use or
maintenance of the Equipment;
19.3.4 any breach, violation or non-performance of any
condition, covenant, obligation, representation or
warranty on the part of DCX pursuant ot this
Agreement, any act or omission of DCX in connection
with the performance of its obligations under this
Agreement,
19.4 DCX will defend, at its expense, any legal action brought
against BELL, a customer or any third party, based on a claim
that the Equipment, any part thereof or any other materials
provided by DCX infringe upon any patent, copyright, trade
secret, or any other proprietary right, provided that DCX is
promptly notified once such a claim comes known. DCX is,
hereby given the authority to defend any such claim on behalf
of BELL but in agreement with XXXX'x policies. DCX agrees to
satisfy any judgment as may be obtained in any such legal
action and to indemnify and save BELL harmless against any
such judgment. If such a claim arises, or if
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in DCX's opinion, is likely to arise, BELL agrees to permit
DCX or a third party at DCX's expense, and option, to
procure for BELL the right to continue using the Equipment
or to replace the Equipment or part thereof with an
equivalent non-infringing product. DCX will have no
obligation or liability whatsoever arising out of
infringement claims based on the use of any part of the
Equipment which was modified by another than DCX in a manner
which constitutes an infringement.
20 NOTICES
20.1 The parties hereby agree that any notice, request, demand,
consent, approval, correspondence or other communication
required or permitted to be given hereunder, shall be in
writing and be sent registered mail, telex, telegram,
facsimile, or other agreeable electric means addressed as
follows:
DCX: BELL:
if of a legal nature, to:
c/o President
DCX Systems Inc. Corporate Secretary
0000 Xxxxxxxx Xxxx 0000 Xxxxxx Xxxx Xxxx
Xxxxxx Xxxxx, Xxxxxxxxxxx Montreal
19090 (Quebec) H2Z 1S4
if of administrative nature, to:
Director - Product Line Management
000 Xx Xxxxxxxxxxx Xxxxxx Xxxx
Xxxx 0X0
Xxxxxxxx (Xxxxxx) X0X 0X0
All notices or communications provided by this Section shall
be considered effective when received.
21 TRANSFER RIGHTS
21.1 Neither of the parties shall assign, nor in any manner
transfer its interest, or any part thereof in this Agreement
without the prior written consent of the other party which
shall not be necessary for BELL to transfer its rights to a
corporation which is an affiliate within the meaning of the
now current Business Corporations Act.
21.2 Any sale or sales aggregating fifty percent (50 %) or more of
the capital or voting stock of DCX shall be deemed to be an
assignment of this Agreement.
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21.3 Unauthorized assignment shall be deemed to constitute a
material breach.
22 ENTIRE AGREEMENT
22.1 This Agreement and its Appendices contain the entire agreement
between the parties hereto relating to the subject matter
herein and supersedes any prior agreements, obligations,
statements, representations, understandings, communications
and negotiations between the parties, whether oral or written.
Except as otherwise provided in this Agreement, this Agreement
shall bind the parties from and after its signature and the
parties hereby agree that there are no terms and obligations,
covenants, representations, statements or conditions, oral or
written, other than those contained herein.
23 SEVERANCE
23.1 In the event that any of the provisions of this Agreement are
held to be illegal, invalid or unenforceable, any such
provision shall, to the extent permitted by law, be severed
and the remaining provisions of the Agreement remain in full
force and effect.
24 BUSINESS RELATIONSHIP
24.1 The parties agree that this Agreement does not constitute or
otherwise establish any form of joint venture or partnership
between them and neither party has any right or authority to
act as an agent or in any other manner on behalf of or as a
representative of the other party for any purpose whatsoever.
24.2 The obligations of the parties under this Agreement are
divisible in all respects and, subject to any other express
clause to the contrary, the parties expressly exclude solidary
liability.
25 SUCCESSORS AND ASSIGNS
25.1 This Agreement shall inure to the benefit of the parties and
their successors and assigns and shall be binding upon BELL,
DCX and NUMEREX CORP. and their authorized successors and
assigns.
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26 PUBLICITY
26.1 BELL and DCX agree to submit to one another all advertising,
sales, promotions and other publicity matters relating to any
services and products furnished by either of them, wherein the
other's name is mentioned or language used from which the
connection of the other's name therewith may, in its judgment,
be inferred or implied. Each party further agrees not to
publish or use any such advertising, sales promotion or
publicity without the written consent of the other, consent
which shall be given or denied at the party's discretion.
26.2 BELL and DCX shall exercise the best of their abilities in
every respect and shall use their best effort to ensure the
Services are promoted and marketed in a professional manner
that protects the good name and reputation of the other.
26.3 The terms of this Agreement shall remain confidential unless
its disclosure is rendred necessary by any applicable law.
27 CONFLICT OF INTEREST
27.1 DCX and NUMEREX CORP. must guard against prejudicial interests
and avoid any situation likely to create a conflict of
interest between this Agreement and any other situation,
occupation or business.
28 CONFIDENTIALITY
28.1 Confidential Information
It is anticipated that with respect to any matter related to
this Agreement, it may be necessary for the parties to
exchange "Confidential Information". Confidential
Information is information of the parties or of their
suppliers, whether written or in any other tangible form, or
oral including, but not limited to, plans drawings and
information related to design, technical, performance, sales,
financial, personnel, contractual and marketing matters,
including contracts, ideas and concepts, as well as software,
belonging to either of the parties or to their suppliers and
which is provided in relation to this Agreement. Confidential
Information shall remain the property of the disclosing party
or of its suppliers as the case may be, and will be returned
to the disclosing party upon written request together with all
copies that could have been made, unless otherwise agreed upon
in writing.
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28.2 Protection of Confidential Information
Confidential Information shall:
28.2.1 be protected by the receiving party, using the same
degree of care as used to protect similar valuable
information;
28.2.2 be used and reproduced by the receiving party
solely for the purposes of this Agreement; and
28.2.3 be disclosed only to those persons having a need to
know, the whole subject to appropriate
confidentiality undertaking reproducing at a minimum
the content of this Section 28.
28.3 Non-Confidential Information
The following shall not be deemed Confidential Information:
28.3.1 information already known to the receiving party as
evidenced by documentation of said party;
28.3.2 information which is or becomes publicly known
through no fault of the receiving party;
28.3.3 information rightfully received from a third party
without similar restrictions and without breach of
this Agreement;
28.3.4 information approved by the disclosing party in
writing for release or use by the receiving party.
28.4 Notwithstanding, the preceding, all information BELL holds
concerning a customer, except for the customer's name, address
and listed telephone number, is confidential. Any such
information BELL discloses for the sole purpose of enabling
DCX to perform its obligations fully hereunder and is
therefore disclosed to it in confidentiality, and DCX
undertakes to use it solely for the purposes hereof; DCX also
undertakes not to disclose it to anyone whatsoever, including
any of its employees not requiring this information, unless
such disclosure is required by legal authorities; generally,
DCX undertakes to take all possible care and measures
necessary to protect the confidentiality of this information
and to use it only in the manner prescribed by BELL for the
purposes hereof.
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29 WAIVER
29.1 No waiver by any party or any breach by any other party of any
terms, condition, or other provision of this Agreement shall
be deemed a waiver of any breach whether of the same or any
other provision.
30 AMENDMENT
30.1 This Agreement shall not be modified, varied, amended, or
supplemented except by an instrument in writing executed by
both parties.
31 TIME OF ESSENCE
31.1 Time is of the essence in any matter relating to the
performance of this Agreement.
32 LANGUAGE
32.1 The parties hereto have requested that this Agreement as well
as any other documents pertaining to this Agreement be drafted
in the English language. Les parties aux presentes ont requis
que cet accord ainsi que tout document s'y rapportant soient
rediges en anglais.
33 LAW AND DOMICILE
33.1 This Agreement shall be governed, construed and interpreted in
all respects in accordance with the laws of the province of
Quebec and the applicable laws of Canada.
33.2 The parties elect domicile for all matters relating to this
Agreement in the judiciary district of Montreal (Quebec).
34 INTERVENTION
34.1 To these presents intervened NUMEREX CORP., a corporation
incorporated under the laws of Pennsylvania, having its
principal place of business at 0000 Xxxxxxxx Xx., Xxxxxx Xxxxx
XX 00000, represented and acting by Xxxx X. Xxxx, its
President after having taken communication of these presents
and declaring to be satisfied therewith, binds itself as
surety for each and every obligation contracted hereinabove by
DCX, hereby binding itself solidarily with DCX,
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making of the whole its personal affair and consequently
renouncing the benefits of division and discussion.
35 TAXES
35.1 DCX declares that his registration numbers under the Act
respecting the Quebec Sales Tax and the Excise Tax Act are
as follows and that the registrations have not been
cancelled and are not in the process of being cancelled:
i) Quebec Sales Tax (QST): Applied for
ii) Goods and Services Tax (GST): Applied for
iii) Ontario Sales Tax (OST): Applied for
35.2 XXXX declares that its registration numbers under the Act
respecting the Quebec Sales Tax and the Excise Tax Act are
as follows and that the registrations have not been
cancelled and are not in the process of being cancelled:
i) Quebec Sales Tax (QST): 1002969366
ii) Goods and Services Tax (GST): 123614125
36 ESCROW AGREEMENT
36.1 The parties agree to diligently execute the Source Code Escrow
Agreement in the same form as the one attached hereto as
Appendix "E" and forming part hereof.
IN WITNESS WHEREOF the parties hereto have, through their duly authorized
representative, executed this Agreement on the 19th day of August, 1997.
DCX SYSTEMS LTD. XXXX CANADA
-------------------------------- ----------------------------------------
Per Xxxxxxx X. XxXxx Per Xxxxxx Xxxxxxx
Vice-President and Director - Product Line Manager
Chief Financial Officer
NUMEREX CORP.
--------------------------------
Per Xxxx X. Xxxx
President
APPENDIX B "EQUIPMENT"
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Pairs of message switches hardware DEC Alpha from 32 to 160 port Message switch
software DEC Alpha from 32 ports to 160 ports Scanners, Rscanners and Nscanners
as specified by Xxxx VSIM's, ESIM's with In-band signalling and X-R modules
Possible pairs of PC's & appropriate software for future applications
