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Exhibit 10.7
NETGENICS, INC. HAS REQUESTED THAT
THE MARKED PORTIONS OF THIS
DOCUMENT BE ACCORDED CONFIDENTIAL
TREATMENT PURSUANT TO RULE 406
UNDER THE SECURITIES ACT OF 1933
NETGENICS INTERNATIONAL, LTD.
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SYNERGY(TM) SOFTWARE LICENSE
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AND SUBSCRIPTION AGREEMENT
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This SYNERGY(TM) Software License and Subscription Agreement ("Agreement") is
entered into as of April 2, 1999 ("Effective Date"), by and between NetGenics
International, Ltd., an Ohio Limited Liability Corporation with offices at 1717
East Ninth Street, Suite 1600, Cleveland, Ohio 44114 ("NetGenics"), and Hoechst
Schering AgrEvo GmbH., a German corporation with offices at Miraustrasse 54,
Berlin, D-13509, Germany (Hoechst Schering AgrEvo GmbH and its Affiliates (as
defined below), collectively, shall be referred to herein as "Subscriber").
W H E R E A S
NetGenics has developed and owns certain interactive computer software
and hardware known as SYNERGYTM for use in the storage and analysis of research
data in a collaborative environment and provides certain services, including,
but not limited to, services to maintain and extend such software and hardware;
and
NetGenics is willing to license the SYNERGY TM Software (as defined
below) and provide the Services (as defined below) to Subscriber upon and
subject to the terms and conditions of this Agreement; and Subscriber desires to
license such Software and to obtain such Services upon such terms and
conditions.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows.
1. DEFINITIONS The following terms, when used herein with initial capital
letters, shall have the respective meanings set forth in this Article 1.
1.1 "Affiliate", as used herein, shall mean any corporation or other
business entity controlling, controlled by, or under common control with Hoechst
Schering AgrEvo,
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GmbH.; as used herein, the term "control" means the direct or indirect ownership
of at least fifty percent (50%) of the voting shares/stock of a company, or the
power to nominate at least half of the directors, or the power otherwise to
determine the policy and direction of a company or organization.
1.2 "Confidential Information" shall mean that information which is not
generally known to the public or which would constitute a trade secret under the
United States Uniform Trade Secrets Act and which is owned, developed or
acquired by the disclosing party including, without limitation, all programming,
systems and use documentation (including, without limitation, any of the
foregoing as may be embodied in the Licensed Program, the Development System and
Documentation), customer lists, pricing information, technical information,
technology, formulae, information, designs, ideas, inventions, data, data
formats and files, know-how, techniques, sequences, methods, genes, gene
functions, plasmids, proteins, plants, parts of plants, seeds and other
biological or non-biological material, terms of this Agreement, and all copies
and tangible embodiments thereof; provided, however, that any of the foregoing
shall not be considered Confidential Information if it: (i) becomes publicly
known through no wrongful act or breach of any obligation of confidentiality on
the receiving party's or any third party's part; (ii) was in the lawful
knowledge and possession of, or was independently developed by, the receiving
party prior to the time it was disclosed to, or learned by, the receiving party
as evidenced by written records kept in the ordinary course of business by the
receiving party or by written or other documentary proof of actual use by the
receiving party; (iii) was received from a third party not in violation of any
contractual, legal or fiduciary obligation by such third party; or (iv) was
approved for public release by prior written authorization by the disclosing
party.
1.3 "Designated Location" shall mean the location or locations set
forth on EXHIBIT C, attached hereto, as amended from time to time by the
parties.
1.4 "Development System" shall mean hardware and software provided or
approved by NetGenics to Subscriber at a Designated Location solely for the
purpose of development of Subscriber Software. A Development System shall not
include Services as described in Article 6 of this Agreement.
1.5 "Documentation" shall mean the SYNERGY(TM) user and developer
training manuals, release notes and help documentation, as well as documentation
relating to the Integrated Software (as same may be requested by Subscriber), as
same may be modified from time to time, including, without limitation,
modifications and enhancements thereto, owned by or licensed to NetGenics.
1.6 "Hardware" shall mean the computer hardware and Integrated Software
necessary to the operation of the Product, provided by NetGenics as a part of
the Subscription, and only insofar as it relates to the software set forth on
Exhibit B, as same may be amended from time to time as needed. Hardware shall
not include any specialty
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or computational hardware necessary to run Third Party Software, unless mutually
agreed.
1.7 "Integrated Software" shall mean software that is provided by
NetGenics, on behalf of a third party, and integrated as a part of the Software
or Hardware (as defined on Exhibits A and B). Integrated Software shall not
include any software that requires Subscriber to execute a separate agreement
with any third party, in order to be used as a part of the Product. Integrated
Software shall not include Third Party Software.
1.8 "Licensed Program" shall mean the Software and Object Code versions
of other Integrated Software programs provided by NetGenics which are used in
conjunction with the Software to perform certain functions as described in the
Documentation and on EXHIBIT A, attached hereto.
1.9 "Object Code" shall mean the machine readable computer software
code substantially in binary form and which is directly executable by a computer
after processing, but without compilation or assembly.
1.10 "Product" shall mean the Licensed Program, the Hardware, and the
Documentation.
1.11 "Services" shall mean all training, software planning and design,
data conversion, support, quality assurance testing, remote monitoring,
telephone and e-mail support services, on-site monitoring and customization
services provided by or on behalf of NetGenics to Subscriber pursuant to this
Agreement.
1.12 "Service Hours" shall mean the applicable number of hours of
training, software planning and design, data conversion, support services,
quality assurance testing, on-site monitoring services, if any, and all
customization services provided by NetGenics to Subscriber, including any
associated preparation, follow-up and travel time (from NetGenics' London (UK)
office) for activities enumerated on EXHIBIT G.
1.13 "Software" shall mean the Object Code versions of SYNERGY(TM)
including, without limitation, all modifications and enhancements thereto, as
further described on EXHIBIT A, attached hereto and as same may be modified from
time to time, which have been, or may be, developed, and are owned, by
NetGenics. Software does not include other third party software programs
provided by NetGenics and incorporated as part of the Licensed Program. Software
may include methods, routines or interfaces to Third Party Software (defined in
Section 1.18), but does not include Third Party Software itself.
1.14 "Source Code" shall mean computer software code displayed in a
form readable and understandable by a programmer of ordinary skill.
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1.15 "Subscriber Know-How" shall mean concepts, methods, techniques,
data, know-how, compounds, compositions of matter, ideas and inventions,
developed by or on behalf of Subscriber during the term of this Agreement, and
which provides a distinct competitive advantage to Subscriber. Subscriber
Know-How shall not include any information which (a) is in the public domain,
(b) becomes part of the public domain through publication or otherwise except by
breach of this Agreement, (c) was in the possession of NetGenics prior to
disclosure by Subscriber, (d) is received from an independent third party which
has the right to disclose it, or (e) is developed by NetGenics independent of
any disclosure by Subscriber.
1.16 "Subscriber Software" shall mean software, if any, developed by or
on behalf of Subscriber by a third party and incorporated or integrated into the
Licensed Program in accordance with NetGenics' Subscriber Software development
guidelines described in Section 7.3 and set forth as part of the Documentation
as needed. Notwithstanding the foregoing, no software produced by Subscriber
shall be considered Subscriber Software, if such software functions
independently of the Product.
1.17 "Subscription" shall mean the Product, any elected Development
System, and the Services, installed at a Designated Location.
1.18 "Third Party Software" shall mean that software not manufactured
by NetGenics, but which is used in conjunction with the Licensed Program.
Subscriber may be required to license Third Party Software under separate
agreements with the owner of such Third Party Software, in accordance with
Article 4 of this Agreement.
1.19 "User" shall mean a user of the Product who is an employee of
Subscriber, or a collaborator, consultant, agent or contractor of Subscriber who
works principally from a Designated Location, as well as an employee of
Subscriber engaged in work for Subscriber in the Domain Area (as defined in
Section 5.1) other than at a Designated Location; provided, that Subscriber
shall provide written notice to NetGenics of all such Users, which notice shall
contain the name, Domain Area, and location of such User. Notwithstanding the
foregoing, no non-employee of Subscriber shall be considered a User, as defined
in this Section 1.19, unless Subscriber has obtained written agreement from any
such non-employee to abide by all provisions contained in this Agreement, with
special consideration to the covenants of confidentiality as described in
Section 5.5 of this Agreement. The number of Users which shall be allowed to
access the Product shall be the number specified in EXHIBIT C of this Agreement.
The system administrator shall not be considered a User.
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2. DELIVERY AND INSTALLATION; ACCEPTANCE PROCEDURES
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2.1 NetGenics shall deliver and install the Product at each Designated
Location by a date to be mutually agreed upon by the parties. Such installation
with respect to the Product shall be accepted if (i) NetGenics has delivered an
installation notice to Subscriber, (ii) Subscriber does not give notice of
non-acceptance within sixty (60) days of such installation notice, (iii)
Subscriber does not terminate this Agreement, pursuant to Section 2.3 below and
(iv) the Licensed Program performs in accordance with the Documentation provided
by NetGenics and any mutually-agreed applicable acceptance plan at the
Designated Location(s).
2.2 As a condition to NetGenics performing its obligations as set forth
in Section 2.1, Subscriber shall cooperate with NetGenics in the installation of
the Licensed Program and shall perform its responsibilities necessary for such
installation in a timely manner.
2.3 NetGenics shall provide the Subscription to Subscriber, at no
charge, for a period of thirty (30) days from the initial installation at the
first Designated Location and delivery of an installation notice. If, during the
initial thirty (30) day period, Subscriber finds the Subscription to be
unacceptable for any reason, Subscriber may terminate this Agreement and incur
no expense nor further obligation pursuant thereto. Should Subscriber elect to
terminate this Agreement, for any reason, during the thirty (30) day period
immediately following the above-referenced no-charge trial period, Subscriber
may do so upon payment of a consideration equivalent to one month's Fees as
described in EXHIBIT C (and appropriately pro-rated, if necessary). Subscriber
shall bear no further obligation to NetGenics upon termination (excepting
reasonable cooperation in any necessary recovery of NetGenics property) as
described in this Section 2.3. Should Product be inoperable for periods of time
during the trial period described in this Section 2.3 for reasons not the
responsibility of Subscriber, such trial period shall be lengthened accordingly
to compensate for any such period of inoperability.
3. HARDWARE
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3.1 NetGenics will provide, as part of the Subscription, the necessary
Hardware to be used by the Licensed Program from NetGenics. NetGenics will
provide Services for the Hardware, as needed, to ensure proper function of the
Product, and reserves the right to interrupt the operation of the Product for
the performance of regular maintenance, at mutually-agreed scheduled times and
with notice to Subscriber. NetGenics reserves the right to substitute the
Hardware with functionally equivalent or superior Hardware upon no less than
forty-five (45) days' written notice to Subscriber, and at no additional cost to
Subscriber.
3.2 Representations, warranties, guarantees, covenants or agreements, if
any, as to any Hardware supplied by NetGenics are those granted directly by the
manufacturer(s)
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of such Hardware to its customers, and are attached hereto as EXHIBIT H.
NetGenics hereby agrees to take any action as may be reasonable to permit
Subscriber to obtain the benefit of such warranties. NETGENICS MAKES NO
REPRESENTATIONS OR WARRANTIES AS TO ANY HARDWARE PROVIDED BY NETGENICS TO
SUBSCRIBER, INCLUDING, WITHOUT LIMITATION, IMPLIED WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE.
4. THIRD PARTY SOFTWARE
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4.1 At Subscriber's request, NetGenics, from time to time, may provide
Subscriber access to certain Third Party Software for use in connection with the
Subscription. Should Subscriber elect to access such Third Party Software,
Subscriber shall be obligated to obtain and maintain licenses to such Third
Party Software for the term of this Agreement.
4.2 Representations, warranties, guarantees, covenants or agreements,
if any, as to the Third Party Software are those granted directly by the
manufacturer(s) of the Third Party Software to such users of the Third Party
Software. NETGENICS MAKES NO REPRESENTATIONS OR WARRANTIES AS TO THE THIRD PARTY
SOFTWARE, INCLUDING, WITHOUT LIMITATION, IMPLIED WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR PURPOSE.
5. LICENSE
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5.1 Subject to the terms and conditions of this Agreement, NetGenics
hereby grants to Subscriber a non-exclusive, non-transferable right and license
solely to use the Product at the Designated Location(s) for its internal Crop
Science (the "Domain Area(s)") research and development purposes for the Term
(as defined herein) of this Agreement. Additionally, Subscriber may allow access
to the Product to no more than six (6) Users at a location other than a
Designated Location, upon appropriate notice to NetGenics not to exceed,
however, the total Users as set forth in EXHIBIT C.
5.2 Subscriber agrees that it will certify to NetGenics, in writing, by
January first, April first, July first and October first (each a calendar
quarter) of each year any substantive changes (e.g. number of Users, network
configuration, etc.) in the existing Designated Locations. Subscriber agrees
that it will make its records available to NetGenics or its appointed agent at
reasonable times and upon reasonable notice for NetGenics to verify any such
certifications or locations. In the event an appointed agent is used for such
verification, such agent must agree in writing to Subscriber's standard
confidentiality agreement, prior to commencement of any verification activities.
5.3 Except as set forth in Section 5.1, Subscriber shall have no right
or license to do any of the following: (i) sublicense the Product or any portion
thereof; (ii) print, copy, reproduce, distribute, modify, transfer (whether
physically or electronically), assign
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(except as set forth in Section 16.3) or in any other manner duplicate the
Licensed Program or Documentation, in whole or in part except that Subscriber
may retain one (1) tape back-up copy on the Hardware as provided by NetGenics
for disaster recovery only; (iii) allow more than the number of Users set forth
on EXHIBIT C to use the Subscription at a Designated Location (iv) permit the
use by or for the benefit of any non-Affiliate, non Domain-Area third party
(except as set in (vi) forth below) of the Subscription; (v) decompile,
disassemble or otherwise reverse engineer the Product or any part thereof
(except in cases where NetGenics has not fulfilled its obligations under Section
7.3 (a) herein); (vi) use the Subscription other than for the internal
information processing needs of Subscriber in connection with the storage and
analysis of its research data (in the Domain Area(s) specified in Section 5.1)
in a collaborative environment (provided, that the internal information
processing needs of Subscriber may include research activities of Subscriber
which are or may be performed in conjunction with third-party research or
corporate collaborators, so long as members of such research or corporate
collaborators are not provided access to the Software, any Development System or
the Licensed Program, without the prior written consent of NetGenics, which
consent shall not be unreasonably withheld, but which consent may require
written proof of compliance with the provisions of Section 5.5 of this
Agreement) or (vii) provide access to the Product to more than six (6) Users at
any location other than a Designated Location. In addition, except pursuant to
Section 11, Subscriber shall have no right to obtain or use the Source Code for
any Licensed Program.
5.4 All right, title and interest in and to the Software and
Documentation shall at all times be solely vested in NetGenics. All right, title
and interest in and to the third party software programs licensed to NetGenics
as part of the Licensed Program or Hardware shall at all times be solely vested
in the owner(s) of such software program(s). No rights or licenses, express or
implied, other than those granted in Section 5.1 hereof are granted by this
Agreement.
5.5 Subscriber shall keep confidential and not disclose or permit
access to the Subscription or Subscriber Software, except as provided in this
Section 5.5. Subscriber shall use the Subscription only for purposes consistent
with the terms of this Agreement. Subscriber shall advise its employees,
Affiliates, collaborators, consultants, agents and contractors of the
confidential and proprietary nature of the Subscription, and of the restrictions
imposed by this Agreement, and shall: (i) obtain from any and all non-employees
of Subscriber who are provided access to the Subscription (regardless of whether
such non-employees are otherwise deemed Users under this Agreement) their
written agreement to comply with the obligations of Subscriber under this
Agreement, (ii) be responsible for any breach of such agreement by any User, and
(iii) use its best efforts to ensure that no unauthorized person has access to
the Licensed Program and that those persons who are granted access to the
Licensed Program protect such Confidential Information in accordance with the
terms of this Agreement.
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5.6 Subscriber shall notify NetGenics immediately of its knowledge of
the possession, use, or knowledge of any portion of the Subscription by any
person or entity not authorized by this Agreement to have such possession, use
or knowledge. Subscriber shall (i) promptly furnish to NetGenics full details of
such possession, use or knowledge; (ii) assist NetGenics (at no expense to
NetGenics) in stopping and preventing the recurrence of such possession, use or
knowledge; (iii) in the event such unauthorized possession, use or knowledge of
the Subscription is the result of a breach of Section 5.5 (ii) above, shall
provide cooperation to NetGenics in any and all litigation deemed necessary to
protect the Subscription and (iv) in any other event, reasonably consider
cooperation with NetGenics in any litigation deemed necessary by NetGenics to
protect the Subscription, such cooperation not to be unreasonably withheld.
Compliance by Subscriber with this Section 5.6 shall not be construed as a
waiver of any right of NetGenics to recover damages or obtain other relief
against Subscriber in connection with any such unauthorized possession, use or
knowledge.
5.7 NetGenics shall be entitled to audit Subscriber's use of the
Subscription for compliance with the terms and conditions of this Agreement
(either directly or through independent outside auditors or representatives) at
mutually-agreed times (but no more often than two (2) times during any calendar
year), during the term of this Agreement and for one (1) year after the
termination of this Agreement. NetGenics shall not unreasonably interfere with
Subscriber's business operations during any such audit, and Subscriber shall
provide such cooperation as NetGenics may reasonably request in connection with
any such audit. In the event NetGenics elects to employ independent parties in
the conduct of activities anticipated by this Section 5.7, such independent
parties shall agree to be bound by Subscriber's standard confidentiality
agreements.
5.8 Subscriber and NetGenics acknowledge that the performance of this
Agreement may result in the development of new concepts, methods, techniques,
data, know-how, processes, adaptations, ideas and expressions of ideas.
(a) Subscriber Know-How developed by or on behalf of Subscriber
shall be and remain the exclusive property of Subscriber. NetGenics shall have
no right and no title or ownership of any component or manifestation of any such
Subscriber Know-How or resulting Domain Area product developed by or on behalf
of Subscriber. All rights in such Subscriber Know-How or resulting Domain Area
products are and shall remain the exclusive property of Subscriber. Concepts,
methods, techniques, data, know-how, processes, adaptations, ideas and
expressions of ideas relating to Subscriber Software shall be and shall remain
the exclusive property of Subscriber; provided, that such concepts, methods,
techniques, know-how, processes, adaptations, ideas and expressions of ideas
relating to the Subscriber Software that contain NetGenics Confidential
Information may only be used by Subscriber in connection with the Licensed
Program. Subscriber agrees not to pursue or assign patent protection to
Subscriber Software. Provided that Subscriber is contractually entitled to do
so, Subscriber hereby grants to NetGenics a non-exclusive, nontransferable right
to use Subscriber Software at the
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Designated Location(s) solely for purposes of providing support to Subscriber
relating to the Licensed Programs pursuant to this Agreement and performing the
other obligations required to be performed by NetGenics pursuant to this
Agreement.
(b) Concepts, methods, techniques, know-how, processes,
adaptations, ideas and expressions of ideas relating to the Subscription and any
to custom software modules (excluding Subscriber Know-How) shall be and shall
remain the exclusive property of NetGenics.
5.9 Subscriber may, at any time during the Term of this Agreement,
upgrade the License type from a Small License to a Medium or a Large License, or
from a Medium License to a Large License (each as described on EXHIBIT C) upon
thirty (30) days written notice. The number of Users, Service Hours, and the
Fees for the upgraded License Type shall become effective as of thirty (30) days
from receipt of notice, and shall continue in force for the remainder of the
Term of this Agreement. Should additional Designated Locations be added to this
Agreement, pursuant to Sections 5.10 or 5.11 below, subsequent upgrade of a
License type shall entitle Subscriber to the discounted Fees as set forth in
those Sections.
5.10 During the Term of this Agreement, Subscriber may add one
additional Designated Location to this Agreement, upon no less than thirty (30)
days written notice. The Fees for the two Designated Locations shall be as
designated herein below with respect to the Fees set forth on EXHIBIT C. The
Designated Location shall be installed as mutually agreed between the parties
but at no additional cost to Subscriber. No more than one additional site may be
added to the Agreement under the provisions of this Section 5.10:
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5.11 During the initial eighteen (18) months following the Effective
Date, Subscriber may add additional Designated Locations(s) (beyond the second
Designated Location as provided in Section 5.10 above), upon no less than thirty
(30) days' written notice and according to the following Fees:
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CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.
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5.12 Subscriber may, upon no less than thirty (30) days notice to
NetGenics, downgrade the License type at a Designated Location from a Large
License to a Medium or a Small License, or from a Medium to a Small License,
each as defined on, and at the Fees set forth on, EXHIBIT C. Any discounts
otherwise associated with multiple Licenses, as described in Section 5.10 or
5.11, shall not extend to any License downgraded pursuant to this Section 5.12.
5.13 Subscriber may, upon no less than ninety (90) days' written
notice, terminate a Designated Location, (added pursuant to Sections 5.10 or
5.11 above) from this Agreement. Termination of a Designated Location pursuant
to this Section 5.13 shall affect the Fees as follows: for each License at a
Designated Location terminated according to this Section 5.13, any discount in
the Fees (as otherwise provided under Section 5.10 or 5.11) for the smallest
remaining License shall be forfeited for the remaining Term. Notwithstanding the
foregoing, should termination of a Designated Location be accompanied by a
License upgrade (as set forth in Section 5.9 herein) at one of the remaining
Designated Locations, then the Fees schedules set forth in Sections 5.10 or 5.11
(as appropriate) shall apply as written. All termination provisions set forth in
Section 13.5 of this Agreement shall apply to any Designated Location terminated
according to this Section 5.13. Should Subscriber terminate a Designated
Location upon less than ninety (90) days' written notice, then Subscriber shall
pay consideration to NetGenics equal to one calendar quarter's Fees for that
Designated Location.
6. SUPPORT SERVICES
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6.1 Subscriber shall be entitled to receive Services from NetGenics
during the term of this Agreement as described below. Services provided pursuant
to this Section 6.1 shall not reduce the number of Service Hours available to
Subscriber for a particular calendar quarter, except as expressly noted herein:
(a) NetGenics shall provide to Subscriber unlimited remote
consultation regarding the Product, comprised of support, problem determination
and resolution Service by telephone and electronic mail (as described in EXHIBIT
F) 24 hours per day, seven days per week. Such remote consultation shall not be
charged against Subscriber's Service Hours.
(b) Subscriber shall provide NetGenics remote access to the
Product, at no charge to Service Hours, for any and all purposes relating to the
obligations to be performed by NetGenics pursuant to this Agreement, including,
but not limited to, for
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CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.
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purposes of monitoring the performance and integrity of the Licensed Program or
the Hardware and for problem determination and resolution and for other purposes
consistent with the terms of this Agreement; provided, however, that Subscriber,
at its option, may reasonably limit the duration and timing of such access or
may require that NetGenics perform such Services on-site at a Designated
Location pursuant to Section 6.2 (c). Material costs associated with such remote
access (including, but not limited to, telecom, network, or equipment fees),
shall be borne by Subscriber
(c) All requests by Subscriber for support shall be made by way of
designated methods (as described in EXHIBIT F) to NetGenics' client services
group and NetGenics shall respond to same according to the escalation procedures
set forth on EXHIBIT F.
(d) Upon the initial installation and acceptance by Subscriber of the
Licensed Program as provided in Section 2, NetGenics shall provide two (2) days
of on-site end-user training to Subscriber at a Designated Location at no
additional charge to Subscriber. Additional training beyond the initial two (2)
days of training described above shall be deducted from the Service Hours as set
forth in EXHIBIT G, or, if Subscriber has utilized all Service Hours for that
calendar quarter, shall be charged to Subscriber at NetGenics' standard billing
rates then in effect.
(e) As a part of the installation, NetGenics shall install one Object
Request Broker (ORB) on one computational server at Subscriber's Designated
Location at no cost to Subscriber's Service Hours.
6.2 Subscriber is entitled to receive from NetGenics the number of Service
Hours per calendar year as set forth in EXHIBIT C. This Section 6.2 and EXHIBIT
G attached hereto sets forth the manner in which Service Hours may be used by
Subscriber. Any unused Service Hours at the end of a calendar year shall be
forfeited and canceled.
(a) Upon receipt of reasonable advance notice from Subscriber,
NetGenics shall use commercially reasonable efforts to provide Subscriber with
on-site support Services, and the number of Service Hours shall be deducted from
the Service Hours available to Subscriber in exchange for such on-site Services,
as provided in EXHIBIT G attached hereto.
(b) Subscriber shall request Services (including, but not limited to,
development of custom software modules) from NetGenics by completing the form
attached hereto as EXHIBIT D, detailing the Services requested. NetGenics shall
determine the amount and type of Services required, and the schedule for such
Services and forward to Subscriber a response in the form of a statement of
Services, on EXHIBIT E attached hereto. After Subscriber's review and approval
in writing of the statement of Services covering a Services project, NetGenics
shall perform the Services. During a Services project, the number of Service
Hours set forth in the statement of Services shall be
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deducted from those available to Subscriber under this Agreement. Payment for
Services provided by NetGenics on a Services project in excess of such available
Service Hours shall be based on the hourly rates of NetGenics in effect at the
time such Services are provided. Hourly rates for such Services are detailed on
EXHIBIT I, which may be changed, from time to time, upon written notice to
Subscriber. The number of Service Hours deemed to be used for any Service
request shall be the number specified in the statement of Services to Subscriber
prior to the commencement of such Services. Should such Services include the
design and development of custom software modules, such Services shall be
performed according to the procedure in Sections 7.1 and 7.2 of this Agreement.
(c) In the event Subscriber requests that NetGenics provide on-site
monitoring in lieu of remote site support otherwise available under Section
6.1(b) of this Agreement, Subscriber shall be charged Service Hours each
calendar quarter for such on-site monitoring as set forth in EXHIBIT G.
(d) Service Hours will be accounted for on a calendar quarter basis and
NetGenics shall provide Subscriber with monthly cumulative reports during each
calendar quarter detailing projects for which Service Hours were used and the
number of Service Hours used. Once Subscriber has exhausted its Service Hours
for any calendar year, Subscriber shall be charged for any such additional
Services at NetGenics' standard billing rates then in effect, in addition to all
out-of-pocket expenses incurred by NetGenics in connection therewith as
described in Section 10.2.
(e) Except as provided in Section 10.2 and EXHIBIT G of this Agreement,
each party shall bear its own travel expenses related to the performance of this
Agreement.
(f) NetGenics acknowledges that Subscriber may request Services which
relate to the integration of the Licensed Program with Third Party Software or
to creating interfaces between the Licensed Program and other CORBA-based
systems. NetGenics shall use best commercial efforts to deliver such Services to
Subscriber, pursuant to this Section 6.2 and Article 7 herein. Notwithstanding
the foregoing, any delivery of Services which involve any Third Party Software
or CORBA-based systems shall be dependent upon the cooperation and timely
disclosure of requested and necessary technical information from the owner(s) of
any such Third Party Software or CORBA-based systems and shall not require
NetGenics to disclose its Confidential Information to any third party which
NetGenics, in its sole estimation, deems to be competitive with its business.
Subscriber agrees to provide reasonable assistance to NetGenics in the
attainment of such cooperation and technical information as might be required by
NetGenics in conjunction with the delivery of such requested Services.
(g) NetGenics shall be obligated to provide disaster recover/restore
Services to Subscriber, in the event a full system restore is needed. Unless
such restore
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<PAGE> 13
Services are directly caused by defects otherwise covered under Warranty,
Subscriber shall incur charges to Service Hours for such Services.
6.3 NetGenics shall deliver Service Hours to Subscriber as
mutually-agreed in the System Committee; provided, however, that NetGenics shall
not be obligated to provide Service Hours during any one calendar quarter in
excess of one half (1/2) the total number of service hours allotted for one
calendar year.
6.4 As soon as reasonably practicable after the Effective Date, the
parties shall form a committee comprised of no more than three (3)
representatives from each party (the "System Committee"). The System Committee
shall meet no less often than on a quarterly basis (with the venue alternating
between a Subscriber Designated Location and a NetGenics location, unless
otherwise mutually agreed) and shall be charged with the following duties: (a)
coordinating the installation of the Product and the training as provided in
Section 6.1(d) above, (b) overseeing Hardware upgrades and replacements, (c)
formulating, discussing and agreeing to Service requests, including the number
of Service Hours to be used in designing and delivering custom software and
whether any Subscriber Know-How exists in custom software requested by
Subscriber and issues relating to the acceptance of custom software and (d)
except as otherwise provided in Section 7.2 (b), resolving disputes between the
parties arising out of or in connection with this Agreement.
7. CUSTOMIZATION METHODOLOGY
-------------------------
7.1 (a) If Subscriber desires that the Licensed Program be modified,
customized or adapted in any respect to suit Subscriber's specific requirements
through the development of custom software modules, Subscriber shall deliver to
NetGenics written notice thereof, in the form of EXHIBIT D, specifying
Subscriber's requirements in as much detail as possible. Upon receipt of such
notice, NetGenics and Subscriber shall cooperate in good faith to agree upon the
scope of such Services, detailed requirements, high-level design, the timetable
for development and implementation and cost (or Service Hours) therefor;
provided, however, that nothing in this Agreement shall be deemed to (i)
obligate NetGenics to perform any Services in excess of those available by way
of Subscriber's then available Service Hours or (ii) provide Services related to
custom software modules deemed by NetGenics, in its sole discretion, to be
unfeasible. Such agreement shall be set forth in writing, referencing this
Agreement, and shall be incorporated herein as EXHIBIT E.
(b) To the extent the number of Service Hours that NetGenics
estimates will be required to complete a custom software module, as specified in
the aforementioned, mutually agreed development schedule during a calendar year
exceeds Subscriber's then-unused Service Hours for such calendar year, such
customization Services shall be charged to Subscriber at NetGenics' standard
billing rates then in effect.
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<PAGE> 14
(c) Subject to the limitations set forth in Section 14 hereto,
NetGenics warrants that a custom software module, once completed and accepted by
Subscriber in accordance with the terms hereof, shall perform in all material
respects in accordance with the established, mutually-agreed detailed
requirements specified on EXHIBIT E.
(d) Subscriber and NetGenics acknowledge that a custom software
module may contain Subscriber Know-How. In the event Subscriber seeks to
designate part of a custom software module as Subscriber Know-How, Subscriber
shall inform NetGenics of same in writing as a part of EXHIBIT D, and NetGenics
and Subscriber shall jointly agree on the scope of such Subscriber Know-How, and
the extent to which such Subscriber Know-How (i) is necessary to the custom
software module, (ii) does not contain NetGenics Confidential Information, and
(iii) provides competitive advantage to Subscriber, and shall designate same on
EXHIBIT E. NetGenics shall not re-use or incorporate such Subscriber Know-How in
the design or development of any custom software module for any third-party
subscriber of the Software. Notwithstanding the foregoing, NetGenics shall not
be restricted in providing any custom software module to any third party
subscriber which (A) does not contain Subscriber Know-How, or (B) is designed by
NetGenics according to such third party's independent specifications. Service
Hours charged for such customer software modules may be adjusted to reflect lack
of re-use by NetGenics. The System Committee (defined in Section 6.4) shall
determine the scope of Subscriber Know-How and shall resolve any disputes
relating to Service Hours charged for Customer Software Modules.
7.2 (a) NetGenics shall use commercially reasonable efforts to install
custom software modules in accordance with the schedule set forth in the
completed EXHIBIT E, subject to Subscriber performing its obligations under this
Agreement and providing such cooperation as NetGenics may reasonably request to
facilitate such installation. Such installation with respect to any custom
software module shall be deemed complete upon written notice from NetGenics to
Subscriber.
(b) Subscriber shall be deemed to have accepted a custom software
module with respect to which any installation notice has been provided by
NetGenics unless (i) such installed custom software module materially fails to
conform to the specifications as set forth on EXHIBIT E therefor, (ii)
Subscriber gives notice of nonacceptance to NetGenics within thirty (30) days
after the date of such installation notice, and (iii) any such notice of
non-acceptance states specifically with respect to such installed custom
software module, the custom software specifications to which such installed
custom software module fails to conform with sufficient specificity to permit
NetGenics to correct such nonconformity. NetGenics shall use commercially
reasonable efforts to correct any nonconformity found to exist and notify
Subscriber in writing upon the completion of such correction. If NetGenics is
unable to make such corrections, Subscriber's remedy shall be limited, at
NetGenics' sole discretion, to correction of the nonconforming portion of the
custom software
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<PAGE> 15
module or return of the custom software module to NetGenics and the crediting of
expended Service Hours. Subscriber shall cooperate with NetGenics in correcting
such nonconformity.
7.3 Prior to developing any module of Subscriber Software to be covered
by the warranty provisions of Section 14, Subscriber shall have: (a) received
from NetGenics a current copy of any applicable Subscriber Software development
guidelines as described and updated from time to time on the Documentation and
covering such module, (b) submitted a proposal to NetGenics for approval
describing the methodology, specifications and timetable of such Subscriber
Software module, and (c) received NetGenics' written approval for the
development of such Subscriber Software. Subscriber hereby agrees to develop
Subscriber Software modules only in conjunction with a Development System, and
in accordance with the Subscriber Software development guidelines covering such
module. Upon completion of Subscriber Software, Subscriber shall submit
completed Subscriber Software to NetGenics for quality assurance testing, and
shall not install any such Subscriber Software on the Product until NetGenics
has completed such quality assurance testing and provided final approval to
Subscriber. All NetGenics activities under this Section 7.3 shall be charged
against Subscriber's then-available Service Hours, under guidelines as set forth
in EXHIBIT G attached hereto. Subscriber Software developed other than in
accordance with all provisions of this Section 7.3 herein shall void any
warranty rights.
8. SUBSCRIBER RESPONSIBILITIES
---------------------------
8.1 The obligation of NetGenics to perform under this Agreement is
contingent upon Subscriber providing such cooperation as NetGenics may
reasonably request including, but not limited to, providing or performing the
following:
(a) Sufficient and appropriate physical space for the Hardware at
each Designated Location, in a controlled area such as a data center or computer
room, where the hardware is physically secured and environmentally controlled;
(b) Electrical power source in close proximity to the location of
the hardware;
(c) Physical connection to Subscriber's network, firewall or gateway
(as applicable), in proximity to the location of the hardware;
(d) Technical information regarding the addressing and configuration
of Subscriber's DNS (Domain Name Services) and electronic mail servers
sufficient to allow NetGenics' server to communicate with Subscriber's servers;
(e) A minimum of two (2) valid network names (host, node or machine
names) per Designated Location and their associated Internet Protocol addresses;
and
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<PAGE> 16
(f) Reasonable assistance of Subscriber's personnel.
(g) Reasonable assistance and cooperation in the provision of
requested Support Services, as well as other activities within the scope of this
Agreement, for the term of the Agreement.
8.2 It shall be understood by the parties that all Product(s) are intended
to be installed at their respective Designated Location(s) as mutually agreed,
and that Subscriber shall have all necessary facilities available for
installation and acceptance as agreed.
9. SUBSCRIPTION RELEASES
---------------------
9.1 Subject to the provisions of Section 9.3 below, standard upgrades made
by NetGenics to the Subscription (such upgrades "Subscription Releases") at any
time during the term of this Agreement will be offered to Subscriber at no
additional charge.
9.2 If any standard upgrades made to any of the Third Party Software by
their respective owners at any time during the term of this Agreement are
necessary for the Product's continued maintenance, then, at Subscriber's option,
it may purchase such upgrade from the Third Party Software vendor or, if
available, from NetGenics at NetGenics' then current prices. These upgrades
shall be installed at the Designated Location. Subscriber will be responsible
for the cost of the installation of any such upgrades (or if Service Hours are
available, such hours will count against the Service Hours) at NetGenics' then
current hourly rates. Failure by Subscriber to purchase such upgrades as are
identified by NetGenics as essential to the Subscription's continued maintenance
may result in Subscriber forfeiting its rights to receive future Subscription
Releases.
9.3 NetGenics shall furnish the number of full sets of Documentation as
designated in EXHIBIT C for each Designated Location, at no charge to
Subscriber. NetGenics shall provide such updates to the furnished Documentation
as are necessary, in conjunction with Subscription Releases. NetGenics shall, at
Subscriber's request and at NetGenics' then current published prices, furnish
additional sets of the Documentation, together with any revisions therein or
additions thereto.
10. FEES
----
10.1 Unless this Agreement is terminated pursuant to Section 2.3,
Subscriber shall pay to NetGenics consideration (the "Fee") in the amount of
[******] per year, to be paid on a quarterly basis, with the first payment of
[******] to be made within thirty (30) days after the delivery of an invoice,
prorated for any partial calendar quarter and for the no-charge trial period
described in Section 2.3, and with Service Hours for that calendar quarter
similarly prorated. Each subsequent payment of [******] shall be made no later
16
CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.
<PAGE> 17
than five (5) days after the beginning of the calendar quarter for which payment
is due. The Fee as set forth in this Section 10.1 may be changed to reflect
changes in the Designated Location(s) pursuant to Sections 5.9 through 5.13 of
this Agreement, and as amended on EXHIBIT C.
10.2 If Subscriber has exhausted its available Service Hours for any
applicable calendar year, Subscriber shall pay to NetGenics, upon NetGenics'
request, fifty percent (50%) of all reasonable out-of-pocket expenses incurred
by NetGenics in performing Services for Subscriber under this Agreement
including, without limitation, expenses incurred for travel, meals, lodging,
long distance telephone calls, document reproduction, postage, and cost of
storage media such as disks and tapes.
10.3 Subscriber shall pay when due any sales, use, excise, property or
other federal, state, local or foreign taxes, duties, tariffs or other
assessments (other than any tax based solely on the net income of NetGenics) and
related interest and penalties that NetGenics is at any time obligated to pay or
collect in connection with or arising out of the transactions contemplated by
this Agreement. Subscriber agrees to indemnify and hold harmless NetGenics from
any and all of such taxes, duties, tariffs or other assessments. If NetGenics
pays any such amounts which Subscriber is obligated to pay under this Section
10.3, Subscriber shall promptly reimburse NetGenics in an amount equal to the
amount so paid by NetGenics.
10.4 Any payments due NetGenics hereunder which are not paid when due shall
bear interest at the lower of the rate of one and one-half percent (1.5%) per
month or the highest rate permitted by law.
11. SOURCE CODE
-----------
11.1 NetGenics agrees to make Subscriber a beneficiary under the NetGenics'
existing Source Code Escrow Agreement, which shall provide Subscriber with
access to the Source Code for supporting and maintaining the Licensed Program in
the event NetGenics ceases to do business in its regular course.
11.2 NetGenics may make limited examples of Source Code available to
Subscriber, as needed and at NetGenics' sole discretion. All such Source Code
shall be treated as Confidential Information of NetGenics as set forth in this
Agreement.
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<PAGE> 18
12. PROPRIETARY RIGHTS
------------------
12.1 Except for release of Source Code, as set forth in Section 11.1 above,
Subscriber acknowledges that NetGenics is the sole and exclusive owner of the
Software, Services and Documentation and the Source Code of the Software, and
all proprietary rights therein, including, without limitation, all associated
patents, copyrights and trade secrets rights.
12.2 All proprietary notices incorporated in or fixed to the Licensed
Program or Documentation shall be duplicated by Subscriber on all copies or
extracts thereof and shall not be altered, removed or obliterated. A copyright
notice on the Licensed Program or Documentation does not, by itself, constitute
evidence of publication or public disclosure.
12.3 NetGenics and Subscriber acknowledge that the other party's
Confidential Information constitutes commercially valuable proprietary trade
secrets, patent applications, patents, plant breeders' rights, plant variety
protection registration etc. of the disclosing party, including, without
limitation, copyrights, trade secrets and may include software for which patents
have been applied for or issued. The receiving party shall (i) not disclose or
allow access to the Confidential Information to any party other than its
employees, solely on a need-to-know basis, who have signed a nondisclosure
agreement conforming as to intent and effect to this Section 12; (ii) use its
best efforts to protect the Confidential Information against any unauthorized or
unlawful use, disclosure, dissemination or copying; (iii) not use any of the
Confidential Information other than as permitted under the terms of this
Agreement; (iv) not provide or disclose to third parties the Confidential
Information in any form, and (v) not provide or permit public access to the
Confidential Information in whole or in part, including, without limitation, by
computer networks, periodicals, newspapers or any other accessible or
distributed media.
13. TERM
----
13.1 Unless sooner terminated as herein provided, this Agreement shall
commence on the Effective Date and shall terminate upon the third (3rd)
anniversary of the Effective Date (the "Term"). This agreement may be renewed
for subsequent one (1) year terms, at NetGenics' then current license fees, upon
mutual agreement within thirty (30) days of the expiration of the Term.
13.2 Subscriber may terminate this Agreement any time after the first
anniversary of the Effective Date by providing thirty (30) days written notice
thereof to NetGenics.
13.3 Either party may terminate this Agreement if the other party
materially breaches a provision of the Agreement, including, without limitation,
payment obligations, and fails to correct the breach within sixty (60) days
following written notice of the breach.
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<PAGE> 19
13.4 If either party to this Agreement files a petition in bankruptcy, or
if a petition in bankruptcy is filed against it, or if it becomes insolvent, or
makes an assignment for the benefit of creditors or an arrangement pursuant to
any bankruptcy law, the other party shall have the right to terminate this
license upon thirty (30) days' written notice.
13.5 Upon termination of this Agreement for any reason, Subscriber shall:
(i) pay immediately all amounts which are due and payable; (ii) have no further
right and license to use the Subscription or NetGenics' Confidential Information
(except as provided in Sections 13.6 and 13.7); (iii) return, at its cost, the
Product, together with any and all copies, modifications and merged portions in
any form, and all tangible embodiments of the Confidential Information, (unless
it provides assurances reasonably satisfactory to NetGenics that the
Documentation and Confidential Information and all copies thereof have been
destroyed). NetGenics shall have the right to supervise the return or
destruction of all such materials.
13.6 In the event of termination for any reason other than as provided
under Section 2.3 of this Agreement, NetGenics shall provide any outstanding
Services for which Fees have been paid, and shall provide reasonable commercial
assistance to Subscriber in transferring any Subscriber data, held within the
Product prior to termination, into a mutually-agreed, machine-readable form.
Such assistance shall be provided at cost to Service Hours, and should remaining
Service Hours be exhausted, shall be provided at NetGenics' then-current hourly
rates. In addition, NetGenics shall maintain a tape back-up version of the
Product, in Subscriber's system configuration, for a period of five (5) years
after termination. Upon payment to NetGenics of consideration equal to the fair
market value of the Hardware then in use at Subscriber's Designated Location,
the aforementioned tape back-up version of the Product, along with the Hardware
then in use at Subscriber's Designated Location, shall be placed in escrow with
a mutually-agreed escrow agent. Subscriber shall have the right to request, and
NetGenics shall have the obligation to provide, access to the Product,
integrating Subscriber's data as of the date of termination, during the
above-referenced five-year period. Such access shall be subject to no less than
thirty (30) days' written notice from Subscriber, and shall be provided at
NetGenics then-current hourly rates, plus any and all necessary travel and other
expenses, including reasonable and actual expenses incurred for transportation,
meals, telephone, hardware rental, and shipping costs.
13.7 In the event that Subscriber terminates this Agreement on or after the
third anniversary of the Effective Date, Subscriber shall be entitled, upon
payment of a consideration equal to one (1) year's Subscription Fee (as
designated on EXHIBIT C) in effect at the time of such termination, to continue
use of the Product for a period of eighteen (18) months, subject to the
following conditions: (i) Subscriber access shall be "read-only"; i.e. data may
be viewed using the Product, but no new data may be created or analyzed using
the Product, and (ii) no more than twelve (12) persons may have access
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<PAGE> 20
to the Product. NetGenics audit rights, as provided in Section 5.7, shall remain
in force during the above-described extension period.
14. REPRESENTATIONS, WARRANTIES AND LIMITATION OF LIABILITY
-------------------------------------------------------
14.1 NetGenics represents that it has the right and authority to enter
into this Agreement and grant the license contained herein.
14.2 NetGenics warrants to Subscriber from the date of acceptance and
for the Term of this Agreement that: (i) the Product, any custom software
modules developed by NetGenics for Subscriber and any Subscriber Software will
substantially conform to the Documentation, provided that it is used at the
Designated Location and with the environment for which it was designed; (ii) the
Product and any custom software modules developed by NetGenics for Subscriber
will process dates accurately prior to, during and after the calendar year 2000
(including, without limitation, accurate century recognition, ability to
accommodate same century and multi-century formulas and date values and
interface values reflecting the appropriate century); and, (iii) any media on
which the Licensed Program, any custom software modules developed by NetGenics
for Subscriber and the Documentation are distributed will be free from defects
in materials and workmanship under normal use and service.
14.3 NetGenics' entire liability and Subscriber's sole and exclusive
remedy in the event of substantial nonconformity of the Licensed Program or
defective media or Documentation, shall be, at NetGenics' sole discretion, the
correction or work-around of such substantial errors in the Licensed Program,
replacement of the defective media or Documentation, or a refund of a pro-rata
portion of the subscription fee, corresponding to the period of time in which
the Product was non-usable due to non-conformance. Any correction of substantial
errors to the Licensed Program or any replacement media or documentation which
is supplied is warranted for the remainder of the original warranty period.
14.4 Such services and any required warranty service pursuant to this
Section 14 will be performed, by mutual agreement, (i) by telephonic
communication, (ii) via modem from NetGenics' facility, (iii) by NetGenics at
the site of Subscriber or (iv) otherwise as determined by NetGenics and agreed
by Subscriber.
14.5 The warranty contained in Section 14.2 shall be void and of no
effect in the event (i) the Product has been modified, altered or changed in any
manner by Subscriber or any party acting on behalf of Subscriber (other than as
set forth herein), (ii) if any media has been damaged as a result of accident,
misuse or abuse by Subscriber or any party acting on behalf of Subscriber (other
than by NetGenics or its authorized representatives), or (iii) any substantial
nonconformity of the Product is due, through no fault of NetGenics, to the
failure of, or defects in, any Third Party Software used in
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<PAGE> 21
connection with the Licensed Program, including any Subscriber Software
developed other than as provided in Section 7.3 of this Agreement.
14.6 EXCEPT AS SET FORTH IN SECTIONS 14.1 AND 14.2, NETGENICS EXPRESSLY
DISCLAIMS ALL WARRANTIES OR REPRESENTATIONS WITH RESPECT TO THE SUBSCRIPTION
(INCLUDING, WITHOUT LIMITATION, ANY RESULTS CREATED FROM USE OF THE SUBSCRIPTION
HEREUNDER), EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
14.7 NETGENICS SHALL NOT BE LIABLE TO SUBSCRIBER FOR ANY DIRECT DAMAGES
OR CLAIMS IN EXCESS OF THE FEES PAID BY SUBSCRIBER HEREUNDER. NETGENICS SHALL
NOT BE LIABLE TO SUBSCRIBER OR ITS AFFILIATES FOR ANY INDIRECT, SPECIAL,
CONSEQUENTIAL, EXEMPLARY OR INCIDENTAL DAMAGES (INCLUDING, WITHOUT LIMITATION,
LOST REVENUES, ANTICIPATED REVENUES OR PROFITS RELATING TO THE SAME) ARISING
FROM ANY CLAIM RELATING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, WHETHER A
CLAIM FOR SUCH DAMAGES IS BASED ON WARRANTY, CONTRACT, TORT (INCLUDING, WITHOUT
LIMITATION, NEGLIGENCE OR STRICT LIABILITY), EVEN IF AN AUTHORIZED
REPRESENTATIVE OF NETGENICS IS ADVISED OF THE LIKELIHOOD OR POSSIBILITY OF SAME.
SUBSCRIBER ACKNOWLEDGES AND AGREES THAT PAYMENT BY NETGENICS OR RETENTION BY
SUBSCRIBER OF DIRECT DAMAGES AS LIMITED BY THE FOREGOING SENTENCE SHALL BE
SUBSCRIBER'S SOLE AND EXCLUSIVE REMEDY IN EXHAUSTION OF ALL OTHER REMEDIES UNDER
THIS AGREEMENT, AT LAW OR IN EQUITY, AND THAT SUCH REMEDY SHALL NOT BE DEEMED OR
ALLEGED BY SUBSCRIBER TO HAVE FAILED OF ITS ESSENTIAL PURPOSE. IN NO EVENT SHALL
NETGENICS BE LIABLE FOR ANY DAMAGES CAUSED BY SUBSCRIBER'S OR ANY THIRD PARTY'S
ACTS OR OMISSIONS.
15. INDEMNIFICATION
---------------
15.1 NetGenics shall indemnify and hold harmless Subscriber against any
costs, fees or damages arising out of, or related to, any claim that
Subscriber's authorized use or possession of the Product or that the license
infringes or violates any United States or European Patent Office copyright,
patent or trademark of any third party; provided however, that (i) NetGenics has
sole control of the defense and/or settlement, (ii) Subscriber notifies
NetGenics promptly, but no later than thirty (30) days upon receipt by
Subscriber of notice of such claim in writing of each such claim or suit and
gives NetGenics all information known to Subscriber relating thereto, and (iii)
Subscriber cooperates with NetGenics in the settlement and/or defense.
Subscriber shall be reimbursed for all reasonable out-of-pocket expenses
incurred in providing any
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<PAGE> 22
cooperation requested by NetGenics. Failure of Subscriber to so notify NetGenics
will result in the forfeiture by Subscriber of its rights to indemnification
under this Section 15.
15.2 In the event that all or any part of the Product is, or in the
opinion of NetGenics may become, the subject of any claim or suit for
infringement of any third party trademark, patent or copyright, or if
Subscriber's use of the Product is permanently enjoined, NetGenics shall, in its
sole discretion and at its expense, do one of the following: (i) procure for
Subscriber the right to use the Product or the affected part thereof; (ii)
replace the Product or affected part with other suitable software, hardware and
documentation; (iii) modify the Product or affected part to make it
non-infringing; or (iv) refund the license fee paid by Subscriber and terminate
the licensed rights granted herein. Any such refund shall be prorated to reflect
the reasonable value for the use of the Subscription. NetGenics shall be
obligated to advise Subscriber of its intended activities within thirty (30)
days of initial notification of infringement. In the event NetGenics elects
options (ii) or (iii) above, and the resulting Product lacks significant
functionality as described in the Documentation, Subscriber may elect to
terminate this Agreement and incur no further cost nor obligation hereunder.
15.3 NetGenics shall have no obligations under this Section 15 to the
extent a claim is based upon any of the following: (i) the Product or any
portion thereof has been modified, altered or changed in any manner by
Subscriber or any party acting on behalf of Subscriber (other than by NetGenics
or its authorized representatives), if such infringement would have been avoided
in the absence of the use of such altered Product; (ii) the combination,
operation or use of the Product with software which was not provided by
NetGenics, if such infringement would have been avoided in the absence of such
combination operation or use; or (iii) the use of the Software and Documentation
on or in connection with a computer system or hardware components which have not
been approved by NetGenics and/or which are used at a location other than at the
Designated Location without NetGenics' prior written approval.
15.4 This Section 15 states NetGenics' entire liability for any alleged
infringement by the Product or any part thereof.
16. GENERAL
-------
16.1 Sections 5.8, 12.1 through 12.3, 13.5 through 13.7, 14.1, 14.3,
14.5 through 14.7, Article 15 in its entirety, 16.1, 16.7, 16.13 and 16.15 shall
survive the termination of this Agreement for any reason.
16.2 This Agreement and all Exhibits attached hereto and incorporated
herein by this reference contain the entire agreement between the parties hereto
with respect to the subject matter hereof and supersedes any previous
understandings or agreements, whether written or oral, in respect of such
subject matter.
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<PAGE> 23
16.3 This Agreement shall be binding upon and inure to the benefit of
the parties, their successors and assigns. This Agreement or any portion
thereof, or any right or responsibility hereunder, shall not be assignable
(except to a successor or Affiliate) by Subscriber without the prior written
consent of NetGenics, such consent not to be unreasonably withheld. Any
attempted assignment which does not comply with the terms of this Section 16.3
shall be void and of no effect.
16.4 None of the terms of this Agreement shall be deemed to be waived or
amended by either party unless such a waiver or amendment specifically
references this Agreement and is in a writing signed by the party to be bound.
16.5 The illegality, invalidity or unenforceability of any part of this
Agreement shall not affect the legality, validity or enforceability of the
remainder of this Agreement. If any part of this Agreement shall be found to be
illegal, invalid or unenforceable, this Agreement shall be given such meaning as
would make this Agreement legal, valid and enforceable in order to give effect
to the intent of the parties.
16.6 All communications, notices and exchanges of information
contemplated herein or required or permitted to be given hereunder shall be in
writing and shall be deemed properly given when personally delivered, or when
one delivers it to an established courier service, with fees prepaid, or
transmits it by facsimile (with hard copy to follow), addressed to the other
party to the addresses set forth on the first page of this Agreement (or such
other address of which such party shall have given written notice).
16.7 Both Subscriber and NetGenics acknowledge that a breach or failure
to comply with any of the provisions of this Agreement (other than payment
obligations) will irreparably harm the business of the other party, and that
neither Subscriber nor NetGenics will have an adequate remedy at law in the
event of such breach or non-compliance. Therefore, Subscriber and NetGenics
acknowledge that either party shall be entitled to injunctive relief and/or
specific performance without the posting of bond or other security, in addition
to whatever other remedies it may have, at law or in equity, in any court of
competent jurisdiction against any acts of such breach or non-compliance.
16.8 Subscriber will be responsible for the payment of all taxes based
on work performed or products delivered pursuant to this Agreement, except for
taxes based on NetGenics' net income.
16.9 Each party has the right to use the name, logos and trademarks of
the other party in publicity releases or advertising, including customer lists,
or for other promotional purposes, upon the prior written approval of the other
party, such approval not to be unreasonably withheld.
16.10 Nothing herein shall be construed to create any relationship of
employer and employee, agent and principal, partnership or joint venture between
the parties. Neither
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<PAGE> 24
party shall assume, either directly or indirectly, any liability of or for the
other party. Neither party shall have the authority to bind or obligate the
other party and neither party shall represent that it has such authority.
16.11 Notwithstanding anything to the contrary contained in this
Agreement, neither Subscriber nor NetGenics will be responsible for any failure
to perform its obligations hereunder caused by strikes, lockouts, riots,
epidemics, war, governmental regulations, fire, communication line failures,
power failures, acts of God or other causes beyond its control, including acts
or omissions of third parties, and the occurrence of any such event will toll
the time period provided in this Agreement for performance by NetGenics or
Subscriber.
16.12 The article and section headings in this Agreement are for
reference purposes only and will not be deemed to be a part of this Agreement,
nor are they intended to describe, interpret, define or limit the scope or
extent of this Agreement or any provision hereof.
16.13 This Agreement shall be governed by and construed in accordance
with the domestic laws of the State of Delaware, United States of America,
without giving effect to its choice of law or conflict of law provisions.
16.14 If the parties cannot resolve a dispute arising out of or in
connection with this Agreement, then any party may, upon written notice to the
other, have such dispute referred to their respective officers designated below
or their successors, for attempted resolution by good faith negotiations within
thirty (30) days after such notice is received:
For NetGenics: President
For Subscriber: Head of Biotechnology Research
Any such dispute which is not so resolved between the parties or the designated
officers within such thirty (30) day period shall, upon written notice from one
Party to be resolved by final and binding arbitration under the then current
Licensing Agreement Arbitration Rules of the American Arbitration Association
("AAA"). If the claim is filed by one party, then the venue for arbitration
shall be proximate to that of the other party. The arbitration shall be
conducted by a panel of three arbitrators who are knowledgeable in the subject
matter which is at issue in the dispute (the "Panel"). Each party shall have the
right to appoint one member of the Panel, with the third member to be mutually
agreed upon by the two Panel members appointed by the parties or, failing such
agreement, to be selected according to the AAA rules. Notwithstanding the
foregoing, no panel member appointed in pursuit to this Section 16.14 shall be a
resident of the state of Ohio or the Principality of Belgium. In conducting the
arbitration, the panel shall determine what discovery will be permitted,
consistent with the goal of limiting the cost and time which the parties must
expend for discovery (and provided that the Panel shall permit such
24
<PAGE> 25
discovery deemed necessary to permit an equitable resolution to the dispute).
The decision of the Panel shall be in writing and shall set forth the basis
therefor. The Panel shall also determine the steps, if any, that a Party should
take to correct any failure or breach by such Party pertaining to any such
dispute. The Parties shall share equally the Panel's fees and expenses. The
decision of the Panel shall be final and may be enforced by the Party in whose
favor it runs, and such award may be enforced and executed upon in any court
having jurisdiction over the Party against whom the enforcement of such an award
is sought.
16.15 During the Term of this Agreement and for one (1) year thereafter,
neither Subscriber nor NetGenics shall directly solicit for employment any
employee of the other party who was directly involved with the performance of
this Agreement, without the prior consent of that party. Notwithstanding the
foregoing, the provision of this Section 16.15 shall not prohibit either party
from hiring employees of the other party who have applied for positions on their
own and without solicitation by the hiring party.
16.16 Upon execution of this Agreement, NetGenics and Subscriber agree
to cooperate in the preparation of a joint press release stating that the
parties have entered into a software license and service agreement. NetGenics
hereby warrants that it will not use any trademark or make reference to products
or services of Subscriber or its subsidiaries without obtaining the prior
written permission of Subscriber.
IN WITNESS WHEREOF the parties hereto have caused this Software
License Agreement to be executed by their duly authorized representatives as of
the date first above written.
NetGenics International, Ltd. Hoechst Schering AgrEvo GmbH
By: /s/ Keith T. Coleman By: /s/ Dr. Jiujeu Aphauer
--------------------------- ------------------------------------
(Signature) (Signature)
Keith T. Coleman Dr. Jiujeu Aphauer
------------------------------- ----------------------------------------
(Printed Name) (Printed Name)
Title: Chief Financial Officer Title: Member of Agrevo Board
----------------------- --------------------------------
By: /s/ B. Convent
------------------------------------
(Signature)
B. Convent
(Printed Name)
Title: Head, Research and Development,
-------------------------------
Biotechnology
-------------
25
<PAGE> 26
EXHIBIT A
SOFTWARE
--------
February, 1999
SYNERGY(TM) BIOINFORMATICS
[****]
[*****]
[*****]
[*****]
[*****]
[*****]
SYNERGY(TM) and the NetGenics logo are trademarks of NetGenics, Inc. All
other trademarks are property of their respective owners.
1
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------------
CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.
<PAGE> 27
EXHIBIT B
---------
HARDWARE
--------
COMPUTER HARDWARE:
SUN MICROSYSTEMS
SUN MICRO ELECTRONICS ULTRA AXI-PCI
Sun Micro Electronics Ultra AXI-PCI based motherboard/333mhz UltraSparc
IIi processor/1GB ram/1MB cache/10-100 ethernet/two ultra-wide SCSI buses (one
internal and one external)/two high speed serial ports/one additional PCI UW
SCSI card...all the above mounted in an industry standard 19" rackmount chassis
with dual hot-swapping power supplies.
PERIFITECH, INC.
PERIFITECH RAID-5 DISK ARRAY
Perifitech RAID 5 disk array with dual hot-swapping power supplies/UW
SCSI array controller with 32MB cache/7X9.1GB UW SCSI hot-swap drives configured
as 5+1+1 (data+parity reserve+hot-standby) for 45GB usuable and 63GB total
capacity. A 20/40 Quantum DLT drive is also mounted within the chassis...all the
above mounted in an industry standard 19" rackmount chassis.
SUPPLIED BY PERIFITECH
Perifitech P233 MMX system/64MB ram/2.1GB drive/24X cd-rom...mounted in
an industry standard 19" rackmount chassis.
UNINTERRUPTABLE POWER SUPPLY
American Power Conversion Smart UPS 2200/Power Chute Unix
software...designed as a 19" rackmount device (as required)
COMPUTER RACK (AS REQUIRED)
Computer Industry standard rack to fit all the above components. Fully
cabled and fan cooled.
NETGEAR
NETGEAR 10BASET/100BASETX ETHERNET HUB EN516
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INTEGRATED SOFTWARE
-------------------
SUN SOLARIS SERVER LICENSE (UNIX)
SUN INTERNET WORKSHOP
SUN NEO OPERATING ENVIRONMENT
OBJECT DESIGN INC.
OBJECTSTORE RUNTIME
APC POWERCHUTE SOFTWARE
GENE CODES CORPORATION SEQUENCHER(TM) ASSEMBLY ENGINE
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EXHIBIT C
---------
DESIGNATED LOCATIONS, FEES, AND SERVICE HOURS
---------------------------------------------
[*****]
INITIAL DESIGNATED LOCATION: INITIAL LICENSE SIZE: [*****]
---------------------------- ---------------------
Plant Genetic Systems
Jozef Plateaustraat 22
B-9000 Gent, Belgium
[*****]
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------------
CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.
<PAGE> 30
EXHIBIT D
---------
SERVICES REQUEST
----------------
--------------------------------------------------------------------------------
Services Statement No.: ____________________ Date: ________________
NetGenics No.: ___________________________
--------------------------------------------------------------------------------
The following Services Statement terms and conditions shall be
incorporated under the SOFTWARE LICENSE & SERVICES AGREEMENT with:
NetGenics, Inc. and _____________________ ("Subscriber") effective
______________________, providing for a license to certain NetGenics Product
described therein.
Licensee Contact: ______________________________
NetGenics Contact: ___________________________
Services Statement shall be effective: _________________________________
Services shall be provided for the following term: _______________________
TO BE COMPLETED BY LICENSEE
I. DEFINITION OF SCOPE___________________________________________________
------------------------------------------------------------------------
------------------------------------------------------------------------
------------------------------------------------------------------------
------------------------------------------------------------------------
------------------------------------------------------------------------
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<PAGE> 31
IF REQUESTED SERVICES INCLUDE DESIGN AND DEVELOPMENT OF CUSTOM SOFTWARE MODULES,
PLEASE COMPLETE THE FOLLOWING SECTIONS.
II. HIGH LEVEL REQUIREMENTS: (Please respond to the questions below in as much
detail as is known; if additional sheets are attached, please check here)
WHAT IS THE MAJOR CONCEPT OF THE NEEDED CUSTOMIZATION?
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
ARE THERE ANY DEFINITIONS THAT NEED TO BE UNDERSTOOD IN ORDER TO COMPLETE THE
REQUEST?
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
WHAT RESOURCES ARE AVAILABLE TO HELP DEFINE THE PROJECT? IE: ARE THERE JOURNAL
ARTICLES, THIRD PARTY DOCUMENTATION, OR USE CASES THAT MAY BE USED FOR
REFERENCE?
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
WHAT INPUTS ARE TO BE USED IN THE PROCESS; IE: ARE THERE SPECIFIC FILE FORMATS,
DATA ETC., THAT THIS INTERFACE WILL BE PASSING THROUGH TO THE SYSTEM?
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
WHAT OUTPUTS ARE EXPECTED; IE: DO RESULTS FROM AN ANALYSIS NEED TO BE IN A
CERTAIN FORMAT TO BE UNDERSTOOD, IS THERE A DATABASE THAT MUST BE ABLE TO ACCESS
DATA, ETC.?
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
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<PAGE> 32
EXAMPLES:
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
ARE THERE KNOWN OPERATIONS ASSOCIATED WITH THIS?
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
ARE THERE FUNCTIONALITY INTERFACES THAT ARE DESIRED; IE: IS THERE A COMMON
FORMAT FOR WORKING WITH DATA, OR ANALYSES OF THIS SORT THAT WOULD FACILITATE USE
BY THE END-USERS OF THIS MODULE?
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
USAGE PARAMETERS (STANDARD AND BOUNDARIES):
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
NOTES AND COMMENTS:
------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
II. SUBSCRIBER KNOW-HOW:
The following concepts, data types, analyses or parameters are considered
Subscriber Know-How ):
--------------------------------------------------------------------------------
3
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<PAGE> 33
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
III. THIRD PARTY SOFTWARE:
This Custom Software Module incorporates, or contains interfaces to, the
following Third Party Software:
-------------------------------------------------------------------------------
Name of software product
------------------------------------------------------------------------
Owned by
Subscriber certifies that it is the holder of a valid license to the
above-mentioned Third-Party Software and that it has the right to create, or to
have created for it, the custom software module interfacing with, or
incorporating, the above-referenced Third Party Software.
---------------------------------------------------
Subscriber Legal Representative
4
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<PAGE> 34
EXHIBIT E
---------
SERVICES STATEMENT
SPECIFICATIONS, FEES & TIMETABLE
--------------------------------
--------------------------------------------------------------------------------
Services Statement No.: ____________________ Date: ________________
NetGenics No.: ___________________________
--------------------------------------------------------------------------------
TO BE COMPLETED BY NETGENICS
I. SUMMARY OF SERVICES TO BE PERFORMED:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
II. CUSTOM SOFTWARE METHODOLOGY
The following methodology will be used in completing the custom software module
as contained in this request (if applicable):
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
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<PAGE> 35
III. ATTACHED COMPLETED REQUIREMENTS DOCUMENT AND HIGH-LEVEL DESIGN HAS BEEN
REVIEWED AND APPROVED:
For NetGenics: For Subscriber:
-------------------------------- ------------------------------
Approval 1 date Approval 1 date
-------------------------------- ------------------------------
Approval 2 date Approval 2 date
IV. STAFF AND SERVICES REQUIREMENTS
Software Analysis, Design and Development (Estimated Service Hours):___________
Other Resources: (Check here if additional sheets are attached )_______________
Explain:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
-----------------------------------
V. TIMETABLE FOR COMPLETION (INCLUDING THE TIME PERIODS FOR DELIVERY, ACCEPTANCE
TESTING, AND CORRECTION OF ERRORS):
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
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VI. SUBSCRIBER KNOW-HOW:
The following concepts, data types, analyses or parameters are acknowledged by
NetGenics and considered Subscriber Know-How ):
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
This Services Statement for the above-referenced custom software module is
approved for development by both parties as of the date below:
For NetGenics, Inc for Subscriber.
By: _______________________ By:________________________________
Name: _______________________ Name: ______________________________
(Printed/Typed) (Printed/Typed)
Title: _____________________ Title: ____________________________
3
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<PAGE> 37
EXHIBIT F
NETGENICS, INC.
CLIENT SUPPORT AND ESCALATION PROCEDURES
The Client Support Team
A team of Client Support Professionals supports each NetGenics client, each with
specialized knowledge of both SYNERGY software and services and the particular
needs of the individual client. Each team is made of individuals trained in
areas of Biological Research, Bioinformatics, and Hardware and Software
Technical Support. Each client is assigned an Account Manager, who is
responsible for maintaining up-to-date communications with the client
organization and the team. Customization concerns should be directed through the
Account Manager. The purpose of the Support Team is to service all the needs of
the organization, Information Systems (IS) personnel, and end-users.
System monitoring
NetGenics will monitor the server at the customer site, to assist in maintaining
the performance and integrity of the system, as well as to assist in problem
determination and resolution. Remote monitoring of the server is the preferred
method, and is provided without additional cost of Service Hours to the
customer. The customer may, at its option, elect not to provide remote
monitoring access to the NetGenics Client Support Team. In this case, a
Technical Support Representative will conduct regular monitoring of the system
on-site. This time will be charged against the Customer's Available Service
Hours, at an agreed number of hours per Calendar Quarter, plus reimbursement to
NetGenics of incurred travel expenses.
Support Processes
Incoming calls and email reports are handled by a 1st tier Client Service
Specialist. In many cases, this person will be able to resolve most incidents as
they are reported. Whenever possible, calls will be routed live to a member of
the Client Support Team. If no person is immediately available or it is after
business hours (Normal business hours Monday - Friday 0900 to 1800h Belgian
Time), someone will return the call as soon as possible and within the times
outlined (refer to Table 1) to begin the resolution process.
EMAIL WILL BE HANDLED DURING NORMAL BUSINESS HOURS ONLY. An initial reply will
be automatically generated instructing the sender on what to do if the problem
requires more prompt assistance. Incidents reported via email will be addressed
as soon as possible and at least by the end of the next business day.
All incidents are logged and prioritized according to Table 1 by the NetGenics
Support Team, and updates are issued to the Account Manager and clients on a
regular basis (refer to Table 1), according to the priority of the incident.
Each incident is assigned an Incident Number, by which the incident may be
tracked until resolution. All work relating to the incident resolution is
attached to this incident number.
If the 1st tier support person is unable to resolve the call or email at the
time of the call, the call or email will be routed to the appropriate second or
third tier level support, as outlined below (refer to Table 1). Whenever
possible, an unresolved call will be routed live to the member of the Client
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<PAGE> 38
Support Team who is best trained to handle the particular incident. If there are
no appropriate support personnel immediately available, a member of Client
Services will respond within the indicated times (refer to Table 1) to continue
the resolution process.
Automatic Escalation of Incidents
Incidents unresolved after the incoming or initial return call will be escalated
according to the chart below. Escalation periods are based on the priority of
the incident. NetGenics will escalate incidents to second tier Scientific or
Technical support, or third tier Development and Quality Assurance support as
necessary to aid in resolution of the incident.
TABLE 1 -- PRIORITIZATION AND ESCALATION OF INCIDENTS
<TABLE>
<CAPTION>
======================= ==================================================== ====================================
INCIDENT PRIORITY DESCRIPTION ESCALATION
======================= ==================================================== ====================================
<S> <C> <C>
Critical - Server is non-functional. - 20 minutes initial
(Contact by phone - Users are unable to log in. callback
only) - Server is severely malfunctioning. - Account Manager notified.
- Danger of loss or corruption of data is - Failure to resolve
suspected or users are unable to import or immediately escalates to 2nd
manipulate data. tier support.
- 1 hour with no
resolution, NetGenics
Management notified.
- Within 24 hours, NetGenics
support enroute for on-site
incident handling.
- Contact will be maintained
between Client and Account
Manager.
-----------------------------------------------------------------------------------------------------------------
Serious - Server is functional, but one or more - 2 hour initial callback
(Contact by phone services are not operational. - Account Manager notified
only) - Complete loss of multiple key functions - Failure to resolve
could result in escalation of incident to immediately escalates to 2nd
Critical Priority. tier support.
- 4 hours with no resolution,
NetGenics Management notified.
- 8 hours without resolution
escalates to 3rd tier technical
support
- Within 48 hours, NetGenics
support enroute for on-site
incident handling.
- Contact will be maintained
between Client and Account
Manager.
-----------------------------------------------------------------------------------------------------------------
Non-critical - All major services are operational, but - Response within 4 hours
there are "nuisance" errors in the - Failure to resolve
functionality. escalates to 2nd tier support.
- User has a question regarding - 2 Business Days with no
functionality. resolution, NetGenics
Management notified.
-----------------------------------------------------------------------------------------------------------------
</TABLE>
On-Site Support
In instances where on-site support of the Client system is required, the time
required for diagnosis and resolution on-site will be charged against the
Client's Service Hours. There is a four (4) hour
2
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<PAGE> 39
minimum charge for any on-site visit, plus applicable travel expenses. On-site
support in excess of normal business hours will be charged on a premium basis.
If the support call is due to an issue covered by NetGenics warranty, no Service
Hours or expenses will be charged for the on-site call.
Escalation of Incidents by Clients
In some cases, a client will need to escalate the handling of an incident. The
formal escalation path is:
NETGENICS SUPPORT PERSONNEL METHOD OF CONTACT
--------------------------- -----------------
First Tier Support 0800-74-813 (toll free in Belgium)
0130-822-955 (toll free in Germany).
1-888-961-9007 or 1-216-861-4007
Client Account Manager 1-888-861-9007 or 1-216-861-4007
Technical Support Representative Contact via Account Manager or Help Desk
Referral
3
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<PAGE> 40
EXHIBIT G
---------
Use of Service Hours
The information contained in this Exhibit G is set forth as part of this
Agreement and is intended to provide guidelines for use of Service Hours. In no
event, however, should this Exhibit be considered limiting or all-inclusive.
END-USER SUPPORT ACTIVITIES
A. Phone and E-mail support. 24 Hours a day, 7 days a week. No
charge to Service Hours for these activities
B. On-site support and troubleshooting activities:
1. System maintenance support where remote monitoring is
not available: 52 Service Hours/Calendar Quarter.
2. Troubleshooting on-site: No charge during first four
weeks of the contract, then 12 Service Hours per day,
with 4 Service Hour minimum charge. No charge to
Service Hours if Service call is due to System defect
otherwise covered by warranty. Premium charge for
on-site support outside of normal business hours.
CUSTOMIZATIONS TO SYNERGY(TM)-- Quoted on a per-project basis
A. Requires project requirements to be supplied by customer, or
may be prepared by NetGenics (upon request) with the use of
Service Hours.
B. NetGenics returns design and timetable for review before
commencement of work.
TRAINING
A. End-user training.
1. 2 days of on-site initial training at the time of
SYNERGY(TM)installation - no charge to Service Hours
2. Requested follow-up training for new releases or new
employees: 12 Service Hours per day per trainer +
expenses. Maximum 15 Users per trainer.
CONSULTING SERVICES - specialty consulting Services available as requested.
A. Quoted on a per-project basis
B. Examples of possible Services (non-inclusive)
Technology Assessment and Review
Proof-of Concept (prototyping)
Tool/Algorithm Evaluation
Tool/Algorithm Development
Database (schema) Development
1
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<PAGE> 41
DEVELOPER SUPPORT ACTIVITIES
A. Phone and E-mail support: Available during normal business
hours. No charge to Service Hours for normal guidance and
support activities.
B. On-site support when requested or recommended: 12 Service
Hours/day per developer on-site. Premium charge for on-site
support outside of normal business hours
SYNERGY(TM) CERTIFICATION
A. Design review - results in recommendations for changes or
approval of design, as well as generation of a test plan after
approval.
1. 20 Hours charge with 1-week turn-around time for
small projects such as simple single or multiple
algorithm integration.
2. 40 Hours charge with 2-week turn-around time for
larger projects such as design of new object classes
or database integrations.
Charges above are for each iteration of the design review (if
multiple iterations are necessary).
B. Quality Assurance Testing - results in certified
implementation that can be integrated into SYNERGY(TM)
1. Service Hours for testing are quoted at the time of
design approval.
DEVELOPER TRAINING
1. Initial 3-day training course for developers offered
at no charge to Service Hours. Training held at
NetGenics facilities. Up to 3 developers per site (or
equivalent). Maximum five training sessions total for
any Client over multi-site roll-out period. Maximum 8
developers per training session.
2. Additional training sessions:
a. Standard developer training (at NetGenics
facilities) - 250 Service Hours for up to 8
developers. (Expenses additional if training
is held other than at NetGenics facilities)
b. "Custom" training (for advanced topics or
for specialty topics): 250 Service Hours per
training for up to 8 developers + additional
Service Hours for materials preparation
(Service Hours quoted prior to commencement
of activities). Additional expenses charged
if training is held other than at NetGenics
facilities.
2
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<PAGE> 42
EXHIBIT H
HARDWARE
--------
COMPUTER HARDWARE:
PERIFITECH
I. Definition of Warranty obligation and periods:
PerifiTech products are warranted to be free from defects in material
and workmanship from date of purchase, verified by original invoice date, and
for periods as specified below, based on the product type. PerifiTech's sole
liability under such warranty is to exchange or repair, free of charge, any
product which, within the warranty period, is returned to us, and which we
accept as having been defective in material or workmanship.
PerifiTech goods found to be defective upon initial installation
(within thirty {30} days from original invoice date) will be treated as a "No
Charge" Rapid Module Exchange Option (see PerifiTech Support Program). DOA's are
replaced by immediate cross-shipment at PerifiTech's expense. Product found to
be defective after the initial installation, as defined above, would be tested
and repaired or replaced, at PerifiTech's discretion in a reasonable time frame.
The warranty does not apply to faults resulting from misuse, abuse,
neglect, absence of simple preventative user maintenance, accident,
modification, Acts of God, natural disasters, fire, or for products serviced by
anyone other than an authorized PerifiTech service provider.
This warranty does not apply to any product from which PerifiTech's
identification number or plates have been removed, or which PerifiTech, in its
discretion, considers has been repaired, altered, neglected, or used in any such
way as to affect the product adversely (reasonable wear and tear accepted), and
without limiting the generality of the forgoing, this warranty does not apply to
any spare or replacement part used in any product for which it was not designed.
The warranty is given expressly in place of, and excludes all other
warranties and conditions express, or implied, whether under common law, statue
or otherwise, and is expressly excluded in every form of liability for loss
damage, direct or consequential, resulting from defective material, faulty
workmanship, loss or damage to products while in transit or otherwise.
II. Warranty Periods:
Aerial Pentium Servers (Pentium, Dual PRO,Pentium II), Aerial Workstations, 2
1
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<PAGE> 43
Warranty Periods continued
(two) years limited warranty;
- Parts and Labor prior to July 1, 1998 3 (three) years limited warranty;
- Parts and Labor;
- Aerial QUAD Servers, Aerial Ultra-AXi Servers;
- 2 (two) years limited warranty;
- Parts and Labor.
Extended Warranties Available
-----------------------------
- Aerial Arrays, Aerial DAT, Aerial DLT, Aerial
- 8mm, Aerial CDROM;-
- 2 (two) years limited warranty;
- Parts and Labor;
- Aerial Disks and Aerial SCSI Enhancement Kits;
- 5 (five) years limited warranty;
- Parts and Labor
- All other products not listed above (1) year warranty.
III. Software:
No warranty other than the guarantee to conform to the manufacturer's
written product description. Software will be upgraded, as necessary, to meet
these requirements. Fixes are upgraded at no charge; enhancements can result in
nominal upgrade charges.
All respective manufacturers' warranties are in effect by the agreement
through PerifiTech. No other warranties, expressed or implied, by PerifiTech or
any of its representatives, are in effect. All business partners are in
agreement that no Reseller alterations, modifications, or unauthorized service
work are permitted. In such an event, repair and return to original
specification shall be done at the sole cost of the Reseller, and all original
manufacturer warranties will be considered void.
IV. Limitation of Liability:
PerifiTech is not liable for damages to equipment while in transit
to/from their place of business.
PerifiTech is not liable for direct or indirect damage/loss resulting
from delivery delays or loss of data.
PerifiTech reserves the right to repair or replace the unit with
equivalent materials or parts.
PerifiTech reserves the right to charge additional time and material on
units which exhibit tampering.
2
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<PAGE> 44
EXHIBIT I
---------
HOURLY RATE FOR SERVICE HOURS
The information contained in this Exhibit I is set forth as part of this
Agreement and is intended to provide the costs associated with Service Hours.
[*****]
1
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------------
CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.
