<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 21, 1999
TRANSFORMATION PROCESSING INC.
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Nevada 0-23903 95-4583945
------ ------- ----------
(State or Other Jurisdiction of (Commission File Number) IRS Employer
Incorporation) Identification Number)
5500 Explorer Drive, Suite 2000, Mississauga, Ontario L4W 5C7
-------------------------------------------------------------
(Address of principal executive offices)(Zip Code)
(905) 206-1366
----------------------------------------------------
(Registrant's telephone number, including area code)
<PAGE>
Item 5. Other Events
On January 21, 1999, transformation Processing Inc., a Nevada
corporation (the "Registrant"), signed a contract with ICI/ADP, a division
of Automatic Data Processing to migrate ICI/ADP's software applications and
computer data. The contract is priced in the range of the high six digits.
See Exhibit 1 attached hereto, a copy of the agreement.
-2-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Transformation Processing Inc.
Registrant
Dated: February 8, 1999 By: /s/ Paul Mighton
---------------------------------
Paul Mighton, President and Chief
Executive Officer
<PAGE>
Exhibit 99 1
STATEMENT OF SERVICES
ICI/ADP-01
This STATEMENT OF SERVICES is an addendum to the PROFESSIONAL SERVICES AGREEMENT
made as of the 21st day of January, 1999 between TRANSFORMATION PROCESSING INC.
("TPI") and the ICI/ADP DIVISION OF ADP FINANCIAL INFORMATION SERVICES, INC.
("ICI/ADP"), regarding the IMPACT Transformation Project ("IMPACT Project").
1 OBJECTIVE
The objective of the IMPACT Project is for TPI to transform ICI/ADP's IBM AS/400
IMPACT Fixed Income System ("IMPACT") to execute equivalently in the environment
below:
Open Systems Client/Server environment;
ANSI C;
Sun Microsystems Inc.'s Solaris 2.6 UNIX operating system (Application
Server);
Sybase Inc.'s Sybase RDBMS ASE 11.5 and Client Library (Database
Server); and
Microsoft Windows compliant Graphic User Interface (Client),
otherwise as demonstrated by the sample IMPACT Cost of Funds transformation
delivered to and accepted by ICI/ADP on July 2, 1998, and further specified by
the requirements defined in Section 2 below, and with the exclusions specified
in Section 3.
The IMPACT Project will be completed in two phases.
1.1 First Phase
The objective of the first phase ("Phase 1") is to transform a subsystem of
IMPACT ("SUBSYSTEM") and upon ICI/ADP acceptance, as defined in Section 7
below, to immediately continue with the second phase (subject to section 6
below), as defined below.
1.2 Second Phase
The objective of the second phase ("Phase 2") is to transform the full
IMPACT ( "FULLSYSTEM").
2 SCOPE OF SERVICES
2.1 Develop Project Plan
TPI will develop a Project Plan with timeframes and milestones after a full
evaluation of the SUBSYSTEM and FULLSYSTEM source code and database and
components. The project
<PAGE>
-2-
plan will be delivered to ICI/ADP within 10 working____ days after receipt
by TPI of such code, database and components and will
list, order and describe tasks necessary for the transformation of the
source code to deliver to ICI/ADP transformed code ready for
testing and acceptance by ICI/ADP of the transformation of the
source code;
identify delivery date estimates associated with each task.
2.2 Transform SUBSYSTEM and FULLSYSTEM
TPI will perform the tasks defined in the Project Plan. Tasks include
Command Language translation, RPG translation, DDS translation, preparation
of a transformed set of source code to be delivered for testing and
acceptance by ICI/ADP and the documentation of deliveries and the
acceptance status thereof.
2.3 New Transformations
Where a transformation has not been previously demonstrated by TPI to
ICI/ADP, TPI will exercise is discretion as to the manner of the
transformation, subject to approval by ICI/ADP
2.4 Provide project management and technical leadership
TPI will provide technical leadership to implement methods and procedures
appropriate for each component's transformation, to estimate task duration
and delivery dates, and to manage the tasks necessary to accomplish the
component transformation. TPI will provide project management including
tracking actual delivery versus estimate, identification and management of
scheduling conflicts, and monthly project reviews. TPI will attend Project
Review Meetings to report on the status of the work.
2.5 Translation of Common Data Structures and Variables
All common data structures and variables will be transformed and maintained
in a similar manner as in the current version of IMPACT. An example is the
use of the Task Common Structure. This structure will be declared
independently and accessed by all modules as needed. This structure should
not be independently duplicated into all modules accessing its members.
The structure should be included into various executables from a central
location.
2.6 RPG /COPY Files Isolation
Independent modules in /COPY files will be maintained as independent source
objects to enable re-usability without duplication. /COPY files will be
transformed as independent C files containing functions that are linked
during compilation by calling programs with these common modules. General
program structure and logic will not be re-arranged.
Data fields referenced only within BEGSR subroutines, will be declared
locally in the functions and initialized as required.
Data fields referenced globally within BEGSR subroutines, will be
declared in "subroutine
<PAGE>
-3-
includes" for the main program and communicated through the
function calling sequence.
Data fields declared in DS data structures, will be declared in "data
structure includes" for the main program and used to build
standard TPI data structure manipulation functions, to also be
"included" into the program.
Any conflicting field usages that are subroutine local in some
programs but global in others, or inside data structures in some
programs but declared separately in others, will be resolved
jointly by TPI and ICI/ADP.
2.7 Translation of Program Variables
Transformed variable names will not have any special characters as part of
a name. Usage of underscore "_" to precede names is not acceptable.
ICI/ADP will provide alias names, coded in the relevant Data Description
Specifications (DDS), to be used to substitute variable names used in
IMPACT. AS/400 names without aliases but containing special characters such
as "?" or "*", having no equivalent in UNIX or C will be converted by a
rule that translates all special characters into chosen uppercase
alphabetic letters.
2.8 Translation of Comments
All comments that currently appear in IMPACT source objects will be
retained. Comments will be retained in the same location that they appear
within the IMPACT program source.
2.9 Client GUI Presentation
Client front-end presentation and interface will be a Microsoft compliant
Graphical User Interface. Users will have the option of using function
keys or mouse click to initiate a function or action. Location of fields
will remain the same as original screens. Executing applications will
inherit User logons from the Windows logon.
2.10 Network Communication
Client and server network communication will be achieved using standard
TCP/IP protocols.
2.11 Transformation of Database
All database table and data manipulation will be retained in the database
interface programs. Data access using stored procedures or any native
database language is not acceptable. Database table names will remain as
original. In the case of multi-member files, the database table names will
have a numeric suffix, according to the order in which they are created.
All tables will be created to retain the exact same records and field
structures as original files. All related files and data will be
converted. Database logic will be used in application servers and not in
user interface clients.
2.12 Data Access
It is recognized that Sybase handles SET data processing better than ROW
data processing. Application response time will be evaluated by ICI/ADP,
with TPI's assistance,
<PAGE>
-4-
at the conclusion of Phase 1 and the results applied to the optimization of
the transformed Phase 1 by retransformation by TPI of selected files into
Indexed, Stream or Memory access methods. This experience in turn will
allow ICI/ADP to specify how file access will be optimized for Phase 2.
2.13 Logical Files
Logical files will not be transformed into views, but an appropriate index
will be created and row selection performed dynamically from the based-on
table.
2.14 Minimization of Database Connections
A modification to the TPI Session Support module, by adding a request queue
such as the one implemented in the TPI Object Manager, will enable a
multi-user approach to I/O requests. In this configuration, the Session
Support module becomes a server daemon. The correspondence between
application instances and their open cursors is maintained by the I/O
server. Only one connection to the database is required per Session Support
server. More than one such server will be able to be dynamically activated
to provide optimal I/O response. User application instances will be
assigned to SS servers using a simple load-leveling algorithm agreed to by
TPI and ICI/ADP.
2.15 Proprietary Libraries and Object Manager
Proprietary libraries will be delivered in object form, without source, and
will be fully documented. Documentation will include but not be limited to
library behaviors, expected parameters, both inbound and returned, and
usage. Object Manager mechanisms and library functions will be fully
documented
2.16 Execution Modules
To avoid slow loading and the proliferation of processes, related
transformed programs and procedures will be linked into modules. With TPI's
assistance, ICI/ADP will decide program linkage and modularization.
3 SCOPE OF SERVICE EXCLUSIONS
The scope of this project specifically excludes:
3.1 ICI/ADP Project Management
Project management tasks related to the scheduling, performance and
coordination of ICI/ADP staff and its vendors.
3.2 Language Differences
Language version upgrades after Phase 1 and before Phase 2.
3.3 Non-IMPACT software
The selection, provision, use and integration of non-IMPACT software,
except as required for application language transformation and preparation
for execution, such as integrated development environments (IDE), and C
language compilers and linkers. In particular:
<PAGE>
-5-
remote job entry (RJE), facsimile (FAX) and other modes of external
communication including FTP, and tape backup and restore utilities, are
excluded.
3.4 AS/400 features supported by TPI
Specific RPG features included are listed in Appendix A to this Statement
of Services.
Specific CL features included are listed in Appendix B to this Statement of
Services.
Specific CL features excluded, are these:
journaling (database engines normally perform logging for the entire
database, not only selected tables);
display subfiles;
multi-formatted logical files;
special printer forms;
source physical files, as in the CL command CRTSRCPF;
display of file descriptions, as in DSPFD;
display of file field descriptions, as in DSPFFD;
display of object descriptions, as in DSPOBJD;
display of file member descriptions, as in DSPPFM;
configuration control, as in VRYCFG;
commands CSTFSRSBM, TOPC, TRCICF, UPDTFILE;
commands WPADRMSG, WPCRTSG, WPSNDMSG, WPCFGSTS;
operator controls, as in WRKOUTQ;
tape file operations;
backup/restore operations;
facsimile operations;
remote job entry;
file-specific commitment control;
subsystem operations.
3.5 Undocumented Features
Source command language, RPG or DDS that is not documented in IBM's AS/400
Programmer's Reference Manuals.
4 ASSUMPTIONS
TPI's plan for this project is based on the following assumptions:
* Information here has been omitted and filed separately with the
Commission.
5 ICI/ADP RESPONSIBILITIES
The responsibilities listed in this section are to be provided at no charge to
TPI. TPI's performance is predicated upon the following responsibilities being
fulfilled by ICI/ADP.
<PAGE>
-6-
5.1 Project Personnel
ICI/ADP will make available, in a timely manner, one Project Manager /
Project Liaison to participate in TPI tasks described in this Statement of
Services, during the life of the project. In addition, such Project
Manager will be supported by one to two people, who are subject matter
experts, and who will be provided as required. ICI/ADP retains
administrative and personnel responsibility for these people.
5.2 Project Manager
Prior to the start of work under this Statement of Services, ICI/ADP will
designate a person, called the ICI/ADP Project Manager, to whom all TPI
communications will be addressed and who has the authority to act for
ICI/ADP in all aspects of the contract. The ICI/ADP Project Manager's
responsibilities include:
serving as the interface between the TPI project team and all ICI/ADP
departments participating in this project;
administering Project Change Control, together with the TPI Project
Manager;
organizing and attending Project Review Meetings;
obtaining and providing information, data, decisions and approvals,
within three working days of TPI's request unless (i) such
information, data, decisions or approvals cannot be reasonably
obtained and provided within such three-day period and (ii)
ICI/ADP and TPI agree to an extended response time;
resolving deviations from project plans that may be caused by ICI/ADP;
helping resolve project issues and escalating issues within the
ICI/ADP organization, as necessary;
monitoring and reporting project status on a regular basis to ICI/ADP
management;
ensuring that ICI/ADP resources required for the project are available
as needed.
5.3 Technical Support thru the Project Manager
In addition, ICI/ADP shall provide technical support, including analyzing,
modifying and testing transformations, through the Project Manager.
Specific technical support shall include:
<PAGE>
-7-
assisting with the definition of the transformation strategies;
assisting with the enforcement of the project's procedures;
assisting with the evaluation of the impact of Project Change
Requests;
resolving technical problems as they arise;
interfacing with ICI/ADP staff as needed;
reviewing transformations made to the source code;
coordinating the testing of the transformations;
coordinating the validation of the results of all transformation
testing;
5.4 Deliverable Materials from ICI/ADP to TPI
ICI/ADP will make available at the start of the contract, code and
documentation for the existing system including system documentation,
program listings, program documentation, input/output formats, file
layouts, interface specifications and other pertinent documents, as
currently available. Any such documentation shall be updated at ICI/ADP's
discretion. Any such code shall be updated in accordance with the Project
Change Control Procedure.
5.5 Facilities and Access
ICI/ADP will provide suitable on-site office space, office supplies,
furniture, telephone and other facilities equivalent to those provided for
its own personnel for TPI staff members during the term of this agreement.
It is anticipated that the majority of the work will be done at the TPI
Transformation Laboratory in Mississauga, Ontario, Canada, so this will not
be a full-time commitment of space. It is assumed that necessary clearance
will be provided to TPI personnel in accordance with ICI/ADP security
procedures. TPI personnel will be allowed physical access during normal
business hours and other times as required.
5.6 Machine Resources and Software Licensing
While TPI personnel are at ICI/ADP's offices, ICI/ADP will be
responsible for providing computer time and related facilities
and operator services which are reasonably required by TPI and
which are equivalent to that provided for its own staff.
ICI/ADP will be responsible for providing TPI security access to the
application libraries and data and warrants that ICI/ADP has the
rights to grant such access and to modify the contents of these
libraries and data.
ICI/ADP will be responsible for obtaining written approval for TPI to
use, on a confidential basis, proprietary information of any
third party if such data is required by TPI in its performance of
this Agreement. If ICI/ADP cannot obtain such approvals,
ICI/ADP will be responsible for the coordination and use of the
data.
6 COMPLETION CRITERIA
The project will be considered complete when the TPI tasks described in this
Statement of
<PAGE>
-8-
Services have been fulfilled and ICI/ADP has accepted the FULLSYSTEM in
accordance with Section 7 below. Notwithstanding the foregoing or anything else
to the contrary in this Statement of Services, ICI/ADP may terminate the project
and this Statement of Services at any time within 30 days of its Acceptance of
the SUBSYSTEM. In the event of such termination, ICI/ADP shall nonetheless be
obliged to proceed with Acceptance and payment for Phase 1 deliverables, as
specified in Section 14.1 below, received by ICI/ADP before notification to TPI
of such termination.
7 DELIVERY AND ACCEPTANCE
7.1 All transformed SUBSYSTEM and FULLSYSTEM database, client source code and
related headers; build files and data conversion processes, scripts and
documentation attendant to each stage or milestone described in Section 12
will be delivered, installed and compiled at the ICI/ADP facility in New
York.
7.2 Upon written notification to ICI/ADP of the completion of each stage or
milestone described in Section 12 and delivery of the products attendant to
such stage, ICI/ADP shall within 10 working days, in the case of Phase 1,
and 15 working days, in the case of Phase 2, examine the products to
determine whether the products meet the transformation specifications and
standards described in this Statement of Services. If the products do not
meet such specifications and standards, ICI/ADP shall notify TPI thereof in
writing in a timely manner, and TPI will have a period of 10 working days
to correct the defect which will commence on the day the written
notification is received by TPI. When the products delivered in each stage
or milestone described in Section 12 meet the transformation specifications
and standards described in this Statement of Services, such deliverables
will be deemed to have been accepted by ACI/ADP ("Acceptance" of the
deliverables).
7.3 The final delivery of a completed transformation phase will also be
confirmed by a predefined execution test sequence that can be used by both
TPI and ICI/ADP. Such a test sequence will not require more than four hours
to execute, using manually keyed input. Comparison of screen displays,
printed reports, and data file/table dumps, between the source application
on the AS/400 and the migrated application on UNIX, will verify the correct
equivalent execution of the transformation. Stopwatch measurements on both
platforms will be recorded to compare response time.
7.4 Reports
All transformed report programs will generate the same output as the
current SUBSYSTEM or FULLSYSTEM. Report formats will be identical with the
reports for the current SUBSYSTEM or FULLSYSTEM.
<PAGE>
-9-
7.5 TPI will provide written notification to ICI/ADP that the final SUBSYSTEM
or FULLSYSTEM is ready to be tested. The acceptance test period is a period
of 30 working days, in the case of Phase 1, and 90 working days, in the
case of Phase 2, and will commence on the day when the transformations are
delivered to ICI/ADP for acceptance testing, and written notification is
received by ICI/ADP. When the transformations are producing results as
specified in the predefined execution test sequence and the SUBSYSTEM or
the FULLSYSTEM, as the case may be, meets the transformation specifications
and standards described in this Statement of Services, the system will be
deemed to have been accepted by ICI/ADP ("Acceptance" of the system). If
the SUBSYSTEM or the FULLSYSTEM, as the case may be, does not produce the
results as specified in the predefined execution test sequence or meet the
transformation specifications and standards described herein, ICI/ADP shall
notify TPI thereof in writing in a timely manner, and TPI will have a
period of 10 working days to correct the defect which will commence on the
day the written notification is received by TPI. Program defects that
existed in the program prior to submission to TPI are outside the scope of
this project and are not TPI's responsibility. If ICI/ADP has made
modifications to the application or to any related IMPACT components,
operating system or platform, since date of delivery to TPI or after date
of delivery to ICI/ADP, other than agreed upon PCRs, TPI will not be
responsible for correcting the defect.
8 HANDLING PROCEDURES FOR SOURCE CODE MODIFICATIONS OR ADDITIONS
If source code modifications or additions to be transformed are identified
either by ICI/ADP or TPI, they will be incorporated into the project through the
Project Change Control Procedure as described in Section 11.
9 SUPPORT
For the first 90 days after Acceptance at no charge, and for each year
thereafter following payment of an annual maintenance fee, TPI will provide:
9.1 Emergency telephone assistance
seven by twenty-four telephone assistance will be available for
correction of errors related to the transformed FULLSYSTEM and
Libraries; TPI will use its best efforts to develop a temporary
program fix or an emergency bypass;
9.2 Other telephone assistance
during normal business hours at TPI's offices, such telephone
assistance as is reasonable to aid ICI/ADP in its use of the
Libraries;
<PAGE>
-10-
9.3 Maintenance of Libraries
the correction of any errors that are found to exist in the original
transformed FULLSYSTEM and Libraries;
the incorporation of error fixes into updated transformed FULLSYSTEM
and Libraries;
updated transformed FULLSYSTEM and Libraries to operate with all
updated or revised versions of the operating and database systems
for which the Libraries are licensed;
technical bulletins and updated user guides as required to ensure
their continued usefulness;
TPI will make such changes in the transformed FULLSYSTEM and Libraries
to improve their quality or efficiency as TPI considers to be
logical improvements;
TPI will supply any improvements or modifications to the transformed
FULLSYSTEM and Libraries which are not charged for as options.
9.4 Escrow of source code
TPI agrees to keep, and maintain current, a copy of the source code
and object code for the Libraries and transformation software, as
specified in Appendix C of this Statement of Services, in escrow.
The escrow agent shall be selected by TPI within 90 days of the
execution of this agreement. The escrow agent shall be paid by
TPI and shall be authorized to release the source code in the
event of TPI's cessation, for any reason, to do business, or in
accordance with the escrow agreement approved by ICI/ADP.
10 STATUS REPORT GUIDELINES
10.1 Biweekly Status Report
The TPI Project Manager will provide biweekly status reports. This report
will summarize progress for the period, completed plans for the next period
and outstanding problems. The report will also highlight task
assignment/responsibility and status for any corrective action, and a
summary of all project change control activity during the reporting period.
The project change control summary will provide an ongoing record of
modifications to the project scope and schedule. The report will consist of
the following as appropriate:
<PAGE>
-11-
Activities performed during the reporting period.
Activities planned for the next reporting period.
Project change control summary.
Significant accomplishments, and milestones.
Problems, concerns and recommendations.
Other items of importance.
10.2 Biweekly Project Review
A project review meeting will be held biweekly at ICI/ADP's offices in New
York. At that meeting TPI will review and present the biweekly status
report with ICI/ADP. .
11 PROJECT CHANGE CONTROL PROCEDURE
11.1 Changes to this Statement of Services will be processed in accordance with
the procedure described in the Project Change Control Procedure.
11.2 Either ICI/ADP or TPI may request changes to the project Statement of
Services at any time. Since a change could affect the price, schedule or
other terms of the contract, both the ICI/ADP Project Leader and the TPI
Project Manager will decide whether or not the task constitutes a change,
and review and approve the change before amending the contract and
implementing the change. ICI/ADP and TPI will use the following procedure
to control changes to the IMPACT Project. It will also be used if
modifications to previously approved specifications, data file
descriptions; inputs and outputs or other project deliverables are
requested.
11.3 The ICI/ADP or TPI person requesting the change will write a Project Change
Request (PCR) describing the change, and include whatever rationale and/or
effect the change will have on the project from a technical standpoint.
The PCR will be delivered to the TPI Project Manager who will record it in
the Change Request Log.
11.4 The ICI/ADP Project Leader or TPI Project Manager, as appropriate, will
review the proposed change. It is then accepted or rejected for submission
to the other party. TPI shall not unreasonably reject proposed changes by
ICI/ADP. The TPI Project Manager records the status, accepted or rejected,
in the Change Request Log. If rejected, the PCR is returned to the
originator with the reason for rejection.
11.5 The ICI/ADP Project Leader or TPI Project Manager will weigh the merits of
the proposed change and approve it for investigation or reject it.
Approval of a PCR for investigation by both parties constitutes
authorization by ICI/ADP for the additional fees estimated by TPI to
investigate the PCR. Appropriate staff work will take place after approval
for investigation. Effects on the price, schedule and other terms of the
contract will be determined. The change will be approved or disapproved
for implementation.
11.6 Approved changes will be incorporated into the contract through written
amendment(s) as appropriate.
<PAGE>
-12-
12 PROJECT SCHEDULE
The project start is on upon the execution of this Statement of Services.
12.1 The following deliverables and documentation attendant to each stage or
milestone constitute the Project Schedule. The delivery dates in 12.2 and
12.3 below are based on a project start date of November 16, 1998, and will
be adjusted according to the actual project start date.
12.2 PHASE 1
DELIVERABLE DATE
Phase 1 CL translations compiled 12/25/1998
Phase 1 Database Ready 01/08/1999
Phase 1 Linkage Analysis Ready 02/05/1999
Phase 1 RPG Translations Compiled 02/05/1999
Phase 1 GUI Display Ready 02/12/1999
Phase 1 Ready for Acceptance Test 03/12/1999
12.3 PHASE 2
DELIVERABLE DATE
Phase 2 Database Ready 04/01/1999
Phase 2 GUI Displays Ready 04/29/1999
Phase 2 RPG Translations Ready 05/28/1999
Phase 2 Linkage Analysis Ready 05/28/1999
Phase 2 CL Translations Compiled 06/11/1999
Phase 2 Ready for Delivery 06/25/1999
13 FEES
* Information here has been omitted and filed separately with the
Commission.
14 PAYMENT OF FEES
* Information here has been omitted and filed separately with the
Commission.
<PAGE>
-13-
14.2 All fees payable hereunder to TPI, are exclusive of all sales, use or other
taxes, customs, duties and similar levies if any, payable in or to any
jurisdiction or authority whatsoever, which taxes, customs, duties and
levies shall be the responsibility of ICI/ADP (other than taxes on the net
income of TPI). Overdue amounts shall accrue interest from the relevant
due date until the date that payment is received at the rate of two per
cent (1.5%) per month (18% per annum). With the prior written consent of
ICI/ADP, those additional services and other deliverables provided by TPI
which are reasonably contemplated hereunder as being provided at an
additional charge and the charge for which is not otherwise set out herein
may be charged to ICI/ADP at TPI's standard rates then in effect plus,
where travel outside of Metropolitan Toronto is required, all reasonable
out-of-pocket expenses, including, without limitation, transportation,
lodging, and meals.
14.3 Such payment is payable within thirty (30) days of a provision of an
invoice by TPI.
14.4 Billing Address: 420 Lexington Avenue, Suite 830,
New York, New York 10170
LICENSE
LICENSE. ICI/ADP hereby grants to TPI the non-exclusive, non-transferable
right to use the source code for the FULLSYSTEM (including the initial
source code and any transformed source code) and the associated
database and components (the "Source Code") during the term of this
Statement of Services solely in connection with the IMPACT PROJECT and
in accordance with the terms and conditions hereof. TPI shall not
distribute any form or portion of, or any derivative work from, the
Source Code. Upon execution and delivery of this Statement of
Services, ICI/ADP shall furnish to TPI one copy of the Source Code for
use in accordance herewith.
OWNERSHIP, USE AND CONFIDENTIALITY. The Source Code shall remain the sole
and exclusive property of ICI/ADP, and shall be treated by TPI as ADP
Information (as defined in the Professional Services Agreement). TPI
will not use the Source Code for its own corporate purposes or
otherwise, except in accordance with the terms of this Statement of
Services. Without limiting the generality of the foregoing, TPI shall
store the licensed copy of the Source Code in a secure place and shall
ensure that access thereto is controlled by an executive officer of
TPI. TPI agrees that it will not, and will not allow any person
having a access to the Source Code to, disclose or use the same,
except in accordance with the terms of this Statement of Services.
TPI shall not use, or permit any third party to use, the Source code
or any portion thereof for any software development or any other
purpose not explicitly authorized herein.
COMPLIANCE WITH PROVISION. From time to time upon ICI/ADP's request, TPI
shall furnish to ICI/ADP a written certification, signed by an
executive officer of TPI, stating that TPI is in compliance with the
terms of this Paragraph 15. If TPI attempts to use, transfer or
otherwise dispose of all or any portion of the Source Code, or any
duplication or modification thereof, in any manner contrary to the
terms of this Statement of Services, ICI/ADP shall have the right, in
addition to such other remedies which may be available to it, to
injunctive relief enjoining such acts or attempts, it being
acknowledged that legal remedies are inadequate.
RETURN OF SOURCE CODE. The Source Code (including all copies thereof)
shall be returned to ICI/ADP upon the termination of this Statement of
Services. Upon return of the Source Code, TPI shall, at ICI/ADP's
request, furnish to ICI/ADP a written certification, signed by an
executive officer of TPI, stating that TPI has not retained
<PAGE>
-14-
any copies of the Source Code or any modifications thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Statement of Services
as of the date first herein above written.
TRANSFORMATION PROCESSING INC. ICI/ADP DIVISION OF ADP FINANCIAL
INFORMATION SERVICES, INC.
/s/ Paul G. Mighton /s/ William Bell
PAUL G. MIGHTON
CHIEF EXECUTIVE OFFICER WILLIAM BELL PRESIDENT
January 21, 1999 January 21, 1999
DATE DATE
<PAGE>
[TPI LOGO]
THIS AGREEMENT is made as of the 21st day of January, 1999 (the "Effective
Date") between TRANSFORMATION PROCESSING INC., a corporation whose head office
is situated in Mississauga, Ontario ("TPI") and THE ICI/ADP DIVISION OF ADP
FINANCIAL INFORMATION SERVICES, INC. ("ICI/ADP") a corporation whose head office
is situated in New York, NY.
BACKGROUND:
A. ICI/ADP has a requirement for certain services and deliverables as more
particularly set out in the Statement of Services (the "Services").
B. TPI is a company, which provides services and deliverables including the
Services.
C. This Agreement sets out the terms and conditions upon which ICI/ADP will
obtain, and TPI will provide, the Services.
NOW THEREFORE, in consideration of the foregoing background and other good and
valuable consideration that each party hereto acknowledges receiving, ICI/ADP
and TPI agree as follows:
1. PROVISION OF SERVICES. ICI/ADP hereby engages TPI to provide, and TPI in
consideration of the amounts to be paid to it hereunder agrees to provide, the
Services in accordance with the terms of this Agreement. It is contemplated
that ICI/ADP's requirement for Services will evolve during the term of this
Agreement. TPI and ICI/ADP may enter into addenda to this Agreement in the form
set out from time to time to reflect changes to the Services.
2. MANAGEMENT AND REPORTING. The parties each agree to designate an
individual from their respective companies with adequate authority and full
technical competence to deal with matters relating to the performance of this
Agreement (each, being a "Project Manager"). Specifically, the Project Managers
will, on behalf of their respective parties, in accordance with the spirit of
this Agreement, use reasonable efforts to co-ordinate the performance of their
respective obligations pursuant to this Agreement.
3. ICI/ADP RESPONSIBILITIES. ICI/ADP shall make available, at no cost to TPI,
such resources as may be set out in the Services in the form set out and
attached to this Agreement.
4. FEES.
(a) ICI/ADP shall pay TPI, upon being properly invoiced for work actually
performed, as specified in the Services. Each invoice submitted by TPI to
ICI/ADP shall be accompanied by appropriate supporting documentation.
(b) ICI/ADP shall reimburse TPI for all reasonable expenses incurred by the TPI
in connection with the Services performed by such TPI, provided that; (i) TPI
shall obtain ICI/ADP's written approval (unless ICI/ADP waives such approval)
prior to incurring such expenses; (ii) TPI provides ICI/ADP with itemized
invoices with respect to such expenses; and (iii) TPI furnishes ICI/ADP with
receipted bills evidencing such expenses.
<PAGE>
-2-
5. OWNERSHIP OF INTELLECTUAL PROPERTY.
(a) TPI agrees to assign, and hereby assigns, to ICI/ADP the entire right,
title and interest for the entire world in and to all data, programs,
specifications, documentation and other information including, without
limitation, any and all patent, copyright, trade secret or other proprietary
rights relating thereto, made, prepared or created by TPI for ICI/ADP in
connection with the performance of the Services, including, without limitation,
all versions of the transformed IMPACT system (the "ICI/ADP Proprietary
Information"). The ICI/ADP Proprietary Information will become ICI/ADP's sole
and absolute property, and TPI shall not have any rights thereto.
(b) The foregoing shall not include intellectual property rights in any
methodology, transformation software and libraries as specified in Appendix C of
Services, related written materials, logos, names and other support materials
used by TPI in performing the Services (the "TPI Proprietary Information"),
which are the sole and absolute property of TPI, and ICI/ADP shall not have any
rights thereto.
(c) TPI and ICI/ADP agree to sign, execute and acknowledge or cause to be
signed, executed and acknowledged, at the expense of the other, any and all
documents and to perform such acts as may be necessary, useful or convenient for
the purpose of securing to the other, patent, copyright, trade secret or other
proprietary protection throughout the world relating to the Proprietary
Information belonging to the other.
(d) ICI/ADP does not grant TPI any rights to the ICI/ADP Proprietary
Information for any purpose, except as required in order to perform the
Services. TPI grants to ICI/ADP, and ICI/ADP accepts, a perpetual non-exclusive
license to use and copy freely the TPI Proprietary Information, where required
for support of the objective of the Services; PROVIDED, HOWEVER, that TPI does
not grant ICI/ADP any rights to use TPI's methodology or technology for any
other purpose, except that ICI/ADP is free to use any derived intangible ideas
for whatever purpose.
6. LIMITATION OF LIABILITY. The limitation of liability provisions of this
Agreement reflect an informed voluntary allocation of the risks (known and
unknown) that may exist in connection with the provision and performance of the
Services hereunder by TPI and ICI/ADP acknowledges that such voluntary risk
allocation represents a material part of the agreement reached between TPI and
ICI/ADP. Should TPI be in breach of any obligation other than an intentional
breach, ICI/ADP agrees that ICI/ADP's remedies will be limited to those set
forth in this Agreement.
(a) DIRECT DAMAGES ONLY. Subject to the restrictions in this Section 6 and
subject to ICI/ADP's election, if so entitled in law, to rescind or be
discharged from this Agreement, in the event of any breach by TPI of its
obligations under this Agreement, including any breach of a fundamental
term or a fundamental breach, ICI/ADP's exclusive remedy shall be to
receive from TPI payment for actual and direct damages to a maximum amount
equal to the amount paid hereunder by ICI/ADP to TPI.
(b) NO INDIRECT DAMAGES, ETC. IN NO EVENT, WHETHER BASED IN CONTRACT, TORT OR
OTHERWISE, SHALL TPI BE LIABLE FOR ANY CLAIM FOR: (A) PUNITIVE, EXEMPLARY,
OR AGGRAVATED DAMAGES; (B) DAMAGES FOR LOSS OF PROFITS OR REVENUE, FAILURE
TO REALIZE EXPECTED SAVINGS, BUSINESS INTERRUPTION, OR LOSS OF USE OR LACK
OF AVAILABILITY OF ICI/ADP FACILITIES, INCLUDING ITS COMPUTER RESOURCES AND
ANY STORED DATA; (C) INDIRECT, CONSEQUENTIAL OR SPECIAL DAMAGES; OR (D)
CONTRIBUTION OR INDEMNITY IN RESPECT OF ANY CLAIMS AGAINST ICI/ADP, EXCEPT
AS SET FORTH IN SECTION 7 BELOW.
<PAGE>
-3-
7. WARRANTY.
(a) Subject to the explicit and implicit Services warranties in this
Agreement and the Services, all deliverables including Services
provided by TPI are provided without any representation, warranty or
condition of any kind, including but not limited to the implied
warranties or conditions of merchantability, fitness for a particular
purpose, non-infringement of third party rights, and those arising by
statute or otherwise in law or from a course of dealing or usage of
trade.
(b) TPI represents and warrants that the performance of the Services by TPI
will not violate any proprietary rights of any third party
(including, without limitation, any third party confidential
relationships, patents, copyrights, trade secrets or other proprietary
rights).
(c) TPI agrees to indemnify and save ICI/ADP harmless from any loss, claim,
damage, costs or expense of any kind (including, without limitation,
reasonable attorney's fees) to which ICI/ADP may be subjected by
virtue of a breach by TPI of the warranties set forth in Section 7(b)
above and the Services.
8. CONFIDENTIALITY.
(a) Each of TPI and ICI/ADP shall use best efforts (and, in any event, that
are no less than the efforts used to protect its own Confidential
Information) to protect from disclosure such information that is the
Confidential Information of the other. Each of TPI and ICI/ADP shall
divulge such Confidential Information only to its employees or agents who
require access to it for the purposes of this letter agreement or as
otherwise provided in this letter agreement. "Confidential Information"
means all data and information relating to the business and management of
either party, including proprietary and trade secrets, and technology to
which access is obtained hereunder by the other party, provided, however,
that Confidential Information shall not include any data or information
which: (i) is or becomes publicly available through no fault of the other
party; (ii) is already in the rightful possession of the other party prior
to its receipt from the other party; (iii) is independently developed by
the other party; (iv) is rightfully obtained by the other party from a
third party; (v) is disclosed with the written consent of the party whose
information it is; or (vi) is disclosed pursuant to court order or other
legal compulsion. Each party acknowledges and agrees with the other party
that the breach by it of this Section 8 would cause serious and irreparable
harm to the other party and which could not adequately be compensated for
in damages and in the event of a breach by a party of any of such
provisions, such party hereby consents to an injunction being issued
against it restraining it from any further breach of such provision, but
such action shall not be construed so as to be in derogation of any other
remedy which the other party may have in the event of such a breach.
(b) TPI shall not use ICI/ADP's name, nor any adaptation or variation
thereof, in any manner whatsoever (including but not limited to,
advertising, promotion or sales literature), without ICI/ADP's prior
written consent in each instance.
9. TERMINATION
(a) Either party shall have the right on notice to the other party to terminate
this Agreement if:
(i) the other party should fail to pay an amount to the other when due
hereunder and such breach is not cured within thirty (30) days after
written notice of such is given to it by the other party;
(ii) the other party shall file a voluntary petition in bankruptcy or
insolvency or
<PAGE>
-4-
shall petition for reorganization under any bankruptcy law (and such
is not dismissed within ten (10) days);
(iii)the other party shall consent to involuntary petition in bankruptcy or
if a receiving order is given against it under the Bankruptcy and
Insolvency Act or the comparable law of any other jurisdiction (and
such is not dismissed within ten (10) days);
(iv) there shall be entered an order, judgment or decree by a court of
competent jurisdiction, upon the application of a creditor, approving
a petition seeking reorganization or appointing a receiver, trustee or
liquidator of all or a substantial part of the other party's assets
and such order, judgment or decree continues in effect for a period of
thirty (30) consecutive days; provided, however, that such order,
judgment or decree may remain in effect for longer than such thirty
(30) days, if the other party is diligently appealing such order,
judgment or decree; or
(v) the other party shall fail to perform any of the other material
obligations set forth in this Agreement and such default in the case
of a default which is remediable continues for a period of thirty (30)
days after written notice of such failure has been given by the
non-defaulting party.
(b) Notwithstanding Section 9(a), TPI may forthwith terminate this Agreement if
ICI/ADP is in material breach of any of Sections 5 and 8 of this Agreement.
TPI shall provide written notice of such termination as soon as practicable
but written notice shall not be a necessary prerequisite to such
termination. ICI/ADP shall have the right to terminate this Agreement in
accordance with Section 6 of the Services.
(c) Upon the termination of this Agreement, without prejudice to any other
rights which the parties may have:
(i) each party shall immediately deliver to the other any of the other's
Confidential Information provided hereunder (including the TPI's
software tools and any modifications or improvements thereto to TPI)
then in its possession or control, if any, and shall deliver a
corresponding officer's certificate;
(ii) each party shall refrain from further use of such Confidential
Information and ICI/ADP shall promptly sign such documentation deemed
necessary by TPI for the purpose of confirming the ownership of its
software tools and the intellectual property rights therein (including
any modifications or improvements thereto); and
(iii)Each party shall forthwith pay all sums owing to the other hereunder.
10. SURVIVAL. The continuing obligations of the parties shall survive the
termination of this Agreement.
11. NON-SOLICITATION OF EMPLOYEES.
During the term of this Agreement and for a period of one year thereafter
each of TPI and ICI/ADP shall not, without the other party's prior written
approval, solicit for employment, nor employ, directly or indirectly, any
of the other party's employees connected with the
<PAGE>
-5-
subject matter of this Agreement. The restrictions contained in this
Section 11 shall also be applicable to former employees of TPI and ICI/ADP
for a period of one year after the date such former employees ceased to be
employed by TPI and ICI/ADP, as the case may be.
12. NO GRATUITIES
Consultant represents, warrants and covenants that it has not provided or
otherwise made available, and will not provide or otherwise make available,
either directly or indirectly, to any officer, director or employee of
ICI/ADP, its divisions and subsidiaries, any monies, gifts or other
benefits of any kind or nature.
13. APPLICABLE LAW.
(a) This Agreement shall be interpreted, construed, and governed by and in
accordance with the laws of the Province of Ontario and the federal
laws of Canada applicable therein (other than any conflict of law
rules that would result in the choice of laws of another jurisdiction)
and shall be treated, in all respects, as an Ontario contract. The
parties agree to submit to the non-exclusive jurisdiction of the
courts of Ontario. ICI/ADP has required that this Agreement and all
documents relating thereto be drawn-up in English. The parties
expressly exclude the application of the United Nations Convention on
Contracts for the International Sale of Goods.
(b) TPI shall comply with all applicable laws, codes, ordinances, rules
and regulations of the federal, state and local Governments, and of
any and all political subdivisions and regulatory authorities thereof.
All necessary permits and licenses required in connection with the
Service shall be obtained for ICI/ADP by TPI, at TPI's expense.
14. RELATIONSHIP OF THE PARTIES
The parties acknowledge that they are independent contractors. Neither
ICI/ADP nor TPI shall in any way represent itself as a partner,
joint-venturer, agent, employee or general representative of the other.
15. ENTIRE AGREEMENT. This Agreement and the Statement of Services attached
constitute the entire agreement between the parties pertaining to the subject
matter hereof and supersedes all prior agreements, understandings, negotiations
and discussions, oral or written, between the parties.
16. FORCE MAJEURE. Dates and times by which TPI is required to render
performance under this Agreement shall be automatically postponed to the extent
and for the period that TPI is prevented from meeting them by reason of any
cause beyond its reasonable control, provided TPI notifies ICI/ADP of the
commencement and nature of such cause and uses its best efforts to render
performance in a timely manner.
17. ASSIGNMENT, ETC. Neither ICI/ADP nor TPI shall assign this Agreement, nor
any of the rights or obligations hereunder without the prior written consent of
the other party. This Agreement shall enure to the benefit of and be binding
upon each of ICI/ADP and TPI and their respective successors and permitted
assigns.
18. MISCELLANEOUS. In the event that one or more of the provisions is found to
be illegal or unenforceable, this Agreement shall not be rendered inoperative
but the remaining provisions shall continue in full force and effect. Except as
otherwise provided herein, no term or provision hereof shall be deemed waived
and no breach excused unless such waiver or consent shall be in writing and
signed by the party claimed to have waived or consented. Any consent by any
party to, or waiver of, a breach by the other, whether expressed or
<PAGE>
-6-
implied, shall not constitute a consent to, waiver of, or excuse for any other
different or subsequent breach. No amendment or modification of this agreement
shall be effective unless in writing and signed by both parties.
19. NOTICE. Any notice or other communication (a "Notice") required or
permitted to be given, provided or made hereunder shall be in writing and shall
be well and sufficiently given or made if either delivered in person; or sent by
any electronic means of sending messages, including facsimile transmission which
produces a permanent paper record (an "Electronic Transmission"), charges
prepaid and confirmed by prepaid first class mail:
With Notice to TPI at:
5500 Explorer Dr.
Suite 2000
Mississauga, Ontario
L4W 5C7
Telephone No. (905) 206-1366
Telecopier No. (905) 206-9650
Attention: Paul G. Mighton
President & Chief Executive Officer
With Notice to ICI/ADP at:
420 Lexington Avenue, Suite 1830
New York, NY
10170
Telephone No. (212) 973-6100
Telecopier No. (212) 983-5570
Attention: William Bell
President
With a copy to ICI/ADP at:
ADP Financial Information Services, Inc.
Journal Square Plaza
Jersey City, New Jersey 07306
Attention: Group President
<PAGE>
Any Notice given or made in accordance with the above shall be deemed to have
been given or made and to have been received:
(i) on the Business Day following delivery, if delivered as aforesaid; and
(ii) on the day of sending if sent by Electronic Transmission during normal
Business hours of the addressee on a Business Day and, if not, then on the
first Business Day after the sending thereof.
Either Party may from time to time change its address to another address for
notice by giving Notice to the other Party in accordance with the provisions of
this Section. "Business Day" means any day from Monday to Friday inclusive,
except statutory or civic holidays observed in Ontario, Canada.
IN WITNESS WHEREOF the Parties have duly executed this Agreement.
TRANSFORMATION PROCESSING INC.
By: /s/ Paul G. Mighton
--------------------------------
PAUL G. MIGHTON, PRESIDENT
AND CHIEF EXECUTIVE OFFICER
THE ICI/ADP DIVISION OF ADP FINANCIAL INFORMATION
SERVICES, INC.
By: /s/ William Bell
--------------------------------
WILLIAM BELL, PRESIDENT
