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EXHIBIT 10.4
GENERAL CO-OPERATION DEVELOPMENT AGREEMENT
THIS GENERAL CO-OPERATION AND DEVELOPMENT AGREEMENT (this
"Agreement") is made and entered into this 8th day of November
2000, by and between Microcell Labs Inc. ("MICROCELL"), a
Canadian corporation with offices at 1250 Rene-Levesque Blvd.
West, Suite 400, Montreal, Quebec, Canada, and 3044016 Nova
Scotia Company ("NSCO") a provider of wireless Internet
applications and services with registered offices in Halifax,
Nova Scotia, Canada:
WITNESSETH:
WHEREAS MICROCELL desires to engage NSCO to perform software
development and consulting projects of different kinds, from
time to time, pursuant to one or more Specific Agreements, and
NSCO is interested in accepting such engagements, the whole
subject to the Parties' further agreement on the scope and
terms of each such Specific Agreement;
WHEREAS NSCO desires to perform such software development and
consulting services by operating and maintaining an office in
Montreal, Canada;
WHEREAS NSCO will grant to MICROCELL a license to use the
products to be developed under this Agreement within the frame
and by the terms of this Agreement; and
WHEREAS MICROCELL and NSCO mutually desire to set forth in
this Agreement certain terms applicable to all such
engagements;
NOW, THEREFORE, MICROCELL and NSCO, intending to be legally
bound, hereby agree as follows:
1 GENERAL
1.1 SUBJECT AND PURPOSE OF THIS AGREEMENT. This Agreement sets forth the
terms and conditions applicable to software development and consulting
projects to be requested by MICROCELL and to be performed by NSCO
pursuant to one or more Specific Agreements, governed by the general
terms of this Agreement.
1.2 DEFINITIONS. For the purpose of this Agreement and any Specific
Agreement, capitalized terms shall have the following meaning:
1.2.1 "Affiliate" shall mean any corporation, partnership or other entity
that is in or under the direct or indirect control of, or under common
control with, the referenced party, and for such purpose "control"
shall exist whenever there is an ownership, profits, voting or similar
interest representing at least 50% of the total interests of the
pertinent entity then outstanding. For the purpose of this definition,
the term "Affiliate" shall include Inukshuk Internet Inc., as long as
Microcell Telecommunications Inc., directly or indirectly owns shares
representing 50% or more of voting rights of such Company.
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1.2.2 "Agreement" shall mean this General Co-operation and Development
Agreement.
1.2.3 "Confidential Information" shall mean information exchanged between the
Parties in accordance with Section 9 hereof, including any information
relating to a Work Product. For purposes of this Agreement,
Confidential Information shall not include, and the obligations
provided hereunder shall not apply to, information that: (a) is now or
subsequently becomes generally available to the public through no fault
of the recipient; (b) recipient can demonstrate was rightfully in its
possession prior to disclosure by the other Party; (c) is independently
developed by the recipient without the use of any Confidential
Information provided by the other Party; (d) recipient rightfully
obtained or obtains from a third party who has the right, without
obligation to the other Party, to transfer or disclose such
information; (e) is released or approved for release by the other Party
without restriction; or (f) is inherently disclosed in the use, lease,
sale, or other distribution of any present or future product or service
produced by, for or under authorization of either Party or in publicly
available supporting documentation for any such product or service.
1.2.4 "Days" (whether or not capitalized) shall mean calendar days unless
otherwise specified, provided that if a deadline falls on a Saturday,
Sunday or holiday, it shall be extended until the following regular
business day.
1.2.5 "Intellectual Property Rights" shall mean any rights under patent,
semiconductor chip protection, copyright, trade secret, trademark or
similar laws throughout the world.
1.2.6 "Minimum Quarterly Charge" as the meaning set forth in Section 7.2 of
this Agreement.
1.2.7 "Parties" shall mean the Parties of this Agreement and "Party" shall
mean any one of them.
1.2.8 "Software" shall mean software that NSCO will develop or create
pursuant to a Specific Agreement or software that MICROCELL develops
and that NSCO integrates into its product offering pursuant to a
request of Microcell.
1.2.9 "Specific Agreement" as the meaning set forth in Section 3.
1.2.10 "Tooling and Test Equipment" ("T/TE") shall mean the hardware and/or
software, listed under this description in any Specific Agreement, that
is required to be specially created or obtained in the manufacture,
assembly or testing in the performance of such Specific Agreement.
1.2.11 "Work Product" shall mean the deliverable items (services, Software,
materials, products, etc.), including iPulse version 1.5, that NSCO
provides or creates as described more specifically in each applicable
Specific Agreement.
2 GENERAL COOPERATION AND TERMS
2.1 GENERAL. This Agreement sets forth the general terms and conditions
that will be applicable to the future co-operation of the Parties.
2.2 RESEARCH AND DEVELOPMENT CREDITS. NSCO agrees to assist MICROCELL to
any reasonable extent in order for MICROCELL to be able to prepare its
annual audited report with respect to being able to claim its yearly
contribution for research and development efforts to Canadian
authorities (i.e. Revenue Canada and Industry Canada). NSCO intends to
claim all possible tax credits under the laws of the Province of Quebec
and Can-
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ada resulting from expenses related to research and
development. In the event NSCO cannot or elects not to claim
such tax credits, NSCO agrees that such tax advantages will be
claimed by MICROCELL and to co-operate with MICROCELL for such
claims.
3 SPECIFIC AGREEMENTS
3.1 SCOPE AND USE. Parties will enter into one or more specific
agreement(s) between them for the purpose of defining or describing one
or more Work Product(s) to be delivered by NSCO to MICROCELL ("Specific
Agreement(s)") during the term of this Agreement. Each Specific
Agreement shall identify the services, functions, equipment, facilities
and other resources to be provided by each Party in order for the tasks
specified in such Specific Agreement to be performed.
3.2 FORMAT AND TERMS. Except as otherwise specifically agreed by the
Parties, each Specific Agreement will conform to substantially the
format provided as an Exhibit A to this Agreement. Each Specific
Agreement shall be entitled "Specific Agreement No. [__] under General
Co-operation and Development Agreement, dated DDMMYY." Each Specific
Agreement shall include a provision for the dated signatures of
authorized representatives of both Parties. In case of discrepancy
between this Agreement and a Specific Agreement, the terms of the
latter shall prevail. Principal terms of the Specific Agreement
generally will include:
o A detailed description of the work to be done and technical
specifications of the expected Work Product.
o Project Team Members of each Party
o Term, Warranties, Maintenance, Support and Services
o Intellectual Property Indemnity
o Services, equipment and facilities (if any) to be provided by
NSCO
o Services, equipment and facilities (if any) to be provided by
MICROCELL
o Third-party services, equipment and facilities (if any) required
to be obtained, which will be MICROCELL's responsibility unless
otherwise indicated
o Target time schedules and delivery dates
o Completion criteria, quality testing standards and reports
o Acceptance tests
o Price for the services and terms of payment
o Any other relevant provisions
3.3 COMMITMENT TO ENTER INTO SPECIFIC AGREEMENT(S). MICROCELL agrees that
NSCO shall be its preferred development resource in the general field
of wireless Internet messanging and presence management applications,
during the term of this Agreement, and if the terms, conditions and
delivery dates imposed by NSCO are reasonable in the circumstances and
in accordance with the terms of this Agreement. MICROCELL agrees to
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engage NSCO in consulting and development projects in the area of
wireless Internet messanging and presence management technologies
pursuant to one (1) or more Specific Agreements governed by the terms
of this Agreement. MICROCELL will act in good faith to provide NSCO
with business and technical information sufficient for NSCO to contract
for each such opportunity, when and as it arises. If such project is
provided by MICROCELL and undertaken by NSCO and is within NSCO's
interest and means, MICROCELL and NSCO shall diligently and in good
faith negotiate applicable terms, conditions, work schedules, and
deliverables. NSCO agrees that Affiliates of MICROCELL may be a Party
to any of the Specific Agreements.
3.4 TYPES OF WORK. It is expected that the projects that NSCO may undertake
pursuant to one (1) or more Specific Agreements will initially relate
to development of wireless Internet software applications and/or
consulting services in the area of wireless Internet technologies.
Other possible projects could include, if mutually agreeable, hosting
services; joint marketing and sales; joint distribution of software
applications outside MICROCELL's distribution channels; maintenance and
support; customization; installation and integration services.
3.5 ADOPTION OF SPECIFIC AGREEMENTS; CHANGES. Specific Agreements, changes
to Specific Agreements, and amendments to this Agreement shall be
effective only if in a writing accompanied by dated signatures of
authorized representatives of both Parties.
3.6 BRANDING OF WORK PRODUCTS. NSCO agrees that MICROCELL or its Affiliates
will have the right to commercialize any Work Product under its own
brand name, trademark or service mark. MICROCELL will however indicate
in the Work Product used by its customers that NSCO is the owner of the
Intellectual Property Rights. Such indication will be clearly made
visible on the product interface, as would appear to the end-user
customer, such as in a "splash screen", "about box" or in a similar
manner.
4 PERFORMANCE
4.1 REASONABLE EFFORTS. The Parties agree to use commercially reasonable
efforts to perform the tasks assigned and to complete the Work Product
specified in each applicable Specific Agreement. All services and Work
Product shall be rendered by NSCO in a workmanlike manner by personnel
having a level of skill commensurate with their responsibilities.
4.2 DELIVERY AND ACCEPTANCE. NSCO shall deliver each Work Product, upon
completion, to MICROCELL's technical coordinator for its testing and
acceptance. NSCO shall memorialize such delivery in a delivery
confirmation, which sets forth the nature and condition of the Work
Product, the medium of delivery, and the date of its delivery.
MICROCELL's principal contact with respect to technical matters
("Technical Contact") shall countersign such delivery confirmation so
as to indicate its receipt of the contents described therein. Unless a
different procedure for testing and acceptance is set forth in a
Specific Agreement, MICROCELL's Technical Contact shall commence
acceptance testing following its receipt of the Work Product. Upon
completion of such testing, MICROCELL shall issue to NSCO's Technical
Contact notice of acceptance or rejection of the Work Product. In the
event of rejection, MICROCELL shall give its reasons for rejection to
NSCO's Technical Contact in reasonable detail. NSCO shall use all
reasonable effort to correct any deficiencies or non-conformities and
resubmit the rejected items as promptly as possible. Unless otherwise
stated in a Specific Agreement, each Work Product will be deemed to be
accepted by MICROCELL in the event it fails to issue any notice,
whether for acceptance or rejection, within thirty 30 days from the
date of delivery of Work Product.
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4.3 TARGET DATES. Scheduled performance dates are estimates only. Both
Parties recognize such dates are dependent on development, resource
availability, funding, assistance, and other factors that may cause
dates to shift or interfere with completion. Each Specific Agreement
could however set forth certain penalties for late deliveries of a Work
Product.
4.4 THIRD-PARTY RESOURCES. References to Work Product or the assignment to
NSCO of responsibility for particular services relating to Work Product
shall not be construed to make NSCO responsible for securing any
related Intellectual Property Rights that may be owned or retained by
third parties, unless the applicable Specific Agreement expressly makes
NSCO responsible for securing those Intellectual Property Rights. A
statement or reference in a Specific Agreement that NSCO is responsible
for obtaining third-party resources, including services, equipment,
facilities, or Intellectual Property Rights, is subject to the
availability of those resources.
4.5 RESOURCES PROVIDED. A Specific Agreement may state that NSCO or
MICROCELL is responsible for obtaining certain resources. Examples of
resources that may be provided by either Party for use in work done
under a Specific Agreement:
o Services, including development services, engineering services,
training, manufacturing services, or administrative support
o Software
o Programming and documentation previously in existence, where the
Intellectual Property Rights are owned by one of the Parties
o Programming and documentation previously in existence, where the
Intellectual Property Rights are owned by third parties and
limited rights to such Software have been obtained by one of the
Parties under license
o Equipment. Unless otherwise agreed, any equipment provided by
either Party to the other Party is loaned for use in performing
the tasks specified in applicable Specific Agreements and, upon
completion of those tasks, shall be returned in the same
condition as received, fair wear and tear excepted. Any charges
applicable for the loan of such equipment shall be set forth in
the Specific Agreement.
o Tooling and Test Equipment.
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4.6 COMPLETION UPON DEFAULT. If NSCO is in material breach of a particular
Specific Agreement to develop a Software, NSCO shall, within 10 days
from the receipt of notice from MICROCELL detailing the nature of the
breach, repair such faults at no additional cost. In the event that
such breach continues for a period of ninety (90) days from the end of
said 10-day period, or in the event of repetitive material breaches in
one or more Specific Agreements, MICROCELL shall have the right to take
delivery of the work-in-process and to complete the Software at its own
expense. Provided that MICROCELL elects to take delivery of the
Software, MICROCELL shall be obligated to pay NSCO for all work
performed up to the date of delivery of the work-in-process to
MICROCELL, plus any work performed by NSCO at the request of MICROCELL
in connection with the support of MICROCELL's completion of the
Software and any integration of the Software for the benefit of
MICROCELL. The Intellectual Property Rights with respect to such
Software shall pass to MICROCELL. In the event MICROCELL exercises its
right to complete the Software as herein described, NSCO shall have the
option to repay all fees paid by MICROCELL relating to the Software in
question and retain full title, right and ownership to the Software.
5 CONTRACT ADMINISTRATION
5.1 PRINCIPAL CONTACTS. The Parties will designate and maintain principal
contacts for purposes of all work and business between them concerning
this Agreement and all notices required or permitted hereunder. These
initially will be:
For NSCO with respect to commercial matters ("Commercial Contact"):
Commercial Contact: To be provided by NSCO
Business Phone:
Business Mailing Address:
Fax:
For MICROCELL with respect to commercial matters ("Commercial
Contact"):
Commercial Contact: Marc Ferland
Business Phone: 514 937 2121
Business Mailing Address: 1250, Rene-Levesque Blvd West, Suite 400,
Montreal, Quebec, H3B 4W8 Canada.
Fax: 514 937-2554
For NSCO with respect to technical matters ("Technical Contact"):
Technical Contact: To be provided by NSCO
Business Phone:
Business Mailing Address:
For MICROCELL with respect to technical matters ("Technical Contact"):
Technical Contact: Marc Ferland
Business Phone: 514 937 2121
Business Mailing Address: 1250, Rene-Levesque Blvd West, Suite 400,
Montreal, Quebec, H3B 4W8 Canada.
Fax: 514 937 2554
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5.2 AUTHORIZATIONS. The signature or initials of the commercial contacts on
Specific Agreements or changes or amendments to Specific Agreements
shall be deemed the authorized signature of the respective Party.
5.3 REPLACEMENT OF PRINCIPAL CONTACTS. If either Party decides at any time
to replace the person serving as its Commercial Contact or its
Technical Contact, it may do so by written notice to the other Party.
5.4 NOTIFICATION. Any notice under this Agreement shall be deemed given if
sent by courier, facsimile or registered mail, directed to the
commercial contact of the Party being notified. Any written notice sent
by courier or registered mail shall be deemed validly given or received
on the tenth (10th) day following the date of its transmission by
courier or mail. Notices given by facsimile are deemed to have been
received on the date of transmission.
6 COMMUNICATIONS; REPORTS; ACCESS
6.1 PROGRESS CONFERENCES. The Parties shall confer monthly, or at other
times specified in the Specific Agreement, regarding the progress of
the work required under each Specific Agreement, any anticipated
problems (resolved or unresolved), and any indication of delay in fixed
or tentative schedules.
6.2 ACCESS. Each Party shall, from time to time and upon reasonable notice,
give the other Party access to its facilities for purposes of design
reviews, "walk throughs," discussion concerning the status and conduct
of work being performed under any Specific Agreements, and verification
of compliance with the terms of this Agreement.
7 COMPENSATION AND PAYMENTS
7.1 METHOD OF COMPENSATION. Charges by NSCO for services rendered under any
Specific Agreement shall be based on hourly and/or daily fees unless
otherwise agreed by both Parties in each Specific Agreement. NSCO
warrants to Microcell that the rates or charges shall not exceed those
offered or imposed with respect to similar services provided to other
non-affiliated customers of NSCO.
7.2 COMMITMENT AND QUARTERLY PAYMENT. In addition to payments based on
Section 7.3, Microcell agrees to commit to purchase a total of
$9,000,000 US in consulting services, software development services,
maintenance services, technology license and other similar services
during the term of this Agreement (the "Purchase Commitment").
Microcell agrees to pay NSCO, on the fifteenth day of every three month
term for twelve (12) consecutive terms ("the Quarterly Term")
commencing as of November 15, 2000, the sum of $750,000 US as
installments or prepayments of the Purchase Commitment (the "Minimum
Quarterly Charge"). The Minimum Quarterly Charges payable by Microcell
are non-refundable, whether or not any services have been rendered by
NSCO to Microcell during a Term. The Minimum Quarterly Charges are
however cumulative during the term of this Agreement; therefore,
Microcell shall not be required to pay NSCO, in a specific Term, any
charge, fee or other compensation in excess of the Minimum Quarterly
Charge until NSCO has rendered to Microcell services in an amount
exceeding the total of the Minimum Quarterly Charges paid by Microcell
up to that specific Quarterly Term. If, during a Quarterly Term, NSCO
renders to Microcell services, the value of which is in excess
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of the Minimum Quarterly Charge of such Quarterly Term (and there is no
Minimum Quarterly Charge accrued) for services, NSCO will invoice
Microcell for the amount of such fees in excess of the Minimum
Quarterly Charge; any payment in excess of the Minimum Quarterly Charge
during a specific Quarterly Term will reduce the Minimum Quarterly
Charges of the following Terms. It is understood by the Parties that
if, at any time during the term of this Agreement, Microcell has paid
NSCO an amount equal to the Purchase Commitment, Microcell shall cease
to pay any Minimum Quarterly Charge.
7.3 REVENUE SHARING. The Parties anticipate that various Work Products will
be developed pursuant to Specific Agreements governed by the terms of
this Agreement. Parties hereby agree to the following terms by which
they will share in revenues resulting from Work Product sold or
licensed by them directly or though an Affiliate. All obligations to
share revenue pursuant to this Section 7.3 shall be determined on a
product-by-product basis and shall run for three years commencing on
the commercial launch of each item of Work Product (the "Revenue
Sharing Term").
o NSCO will pay MICROCELL 10% of its net revenues (i.e., net of
VAT and other taxes), attributable to the sale or license of
Work Product, excluding iPulse 1.5, during the Revenue Sharing
Term of such Work Product. If the Work Product is integrated
into NSCO's offering, then for the purpose of this Section 7.3,
the value of the Work Product shall be negotiated as part of the
Specific Agreement.
o MICROCELL will pay NSCO 10% of its net revenues (i.e., net of
VAT and other taxes), attributable to the sale or license of
Work Product during the Revenue Sharing Term of such Work
Product. The value attributable to the sale or license of the
Work Product shall be the actual price charged to the customer
for the particular product(s) or service(s) where such value is
fixed. In the case Work Product utilized to provide services or
products to FIDO subscribers, the revenue base shall be
calculated as the value for the specific service(s) or
product(s) identified on the customer's invoice, less sales
taxes (GST and PST) attributable to the service(s) or
product(s). For service providers other than Microcell Solutions
Inc. and in the event that specific product(s) or service(s) are
integrated into MICROCELL's base services and cannot be
differentiated at the retail level, then the wholesale price
(net of taxes) will be the value on which the revenue sharing
percentage is calculated. In the event that a wholesale price
has not been established, then MICROCELL's inter-company
transfer price will be the value on which the revenue sharing
percentage is calculated.
7.4 PAYMENT. Payments for services rendered and licensing fees pursuant to
Specific Agreements shall be made in accordance with Section 7.2.
Payments based on revenue sharing, as set forth in Section 7.3, shall
become due thirty (30) days following the end of each quarter, at which
each Party shall pay to the other and all such payments shall be
accompanied by a statement of all revenues that are subject to sharing
according to Section 7.3. Payments not made within thirty (30) days
after receipt of the applicable invoice or the date upon which they are
due (in the case of Minimum Quarterly Charges and payments based on
revenue sharing) shall accrue interest at the rate of one percent (1%)
per month (prorated for partial periods).
7.5 RESPONSIBILITY FOR EXPENSES. Except for the payments to which either
Party may be entitled as stated in a Specific Agreement, each Party
will be responsible for its own expenses incurred in rendering
performance, including the cost of facilities, work space, computers
and computer time, development tools and platforms, utilities
management, personnel, supplies, travel, and the like.
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7.6 COMPENSATION UPON TERMINATION. Subject to the terms and conditions of
each Specific Agreement, in the event of any termination of any
Specific Agreement prior to completion, payment shall immediately be
due for performance rendered pursuant to such Specific Agreement until
the termination, including expenses incurred in connection with
discontinuance of the work in a mutually agreed, orderly fashion.
7.7 SUPPORTING DOCUMENTATION; AUDIT. For the purpose of Section 7.3,
reasonable books of account in support of charges shall be kept and
maintained by both Parties. All such records shall be open for review
or audit by the other Party at reasonable times and on reasonable
notice to support charges based on expenses, for time or materials, or
similar invoice items. An audit of such records may be made, no more
than once each year, by an independent firm of accountants or by such
other individuals as may be reasonably acceptable to the other Party.
The auditors will not have the right to make copies of any documents of
the audited Party and shall keep all information confidential. The cost
of the audit shall be borne by the Party requesting the audit, unless
the audit reveals that the payment made by the audited Party under
Section 7.3 is more than 5% lower that what should have been paid to
the other Party.
8 OWNERSHIP AND INTELLECTUAL PROPERTY
8.1 OWNERSHIP OF WORK PRODUCTS. Unless otherwise expressly agreed to under
a Specific Agreement, NSCO shall be entitled to the full ownership of
all rights, title and interest in Work Products and related
Intellectual Property Rights made under this Agreement and/or any
Specific Agreement. To the extent any portion of a Work Product is
characterized by law as work for hire, MICROCELL hereby irrevocably
assigns all right, title and interest it may have in the same to NSCO
and agrees to execute and deliver any further documents necessary to
effectuate said assignment. Notwithstanding the foregoing, if a
particular Work Product is Software unrelated to NSCO's offering, or if
the Work Product is Software completed by MICROCELL pursuant to Section
4.6, then MICROCELL shall be entitled to the full ownership of all
rights, title and interest in such Software and related Intellectual
Property Rights, but MICROCELL shall grant to NSCO a fully paid-up,
unrestricted license to use, sell and distribute outside Canada the
Software for three (3) years from the completion date of the Software.
8.2 LICENSE GRANT. Subject to the restrictions and other terms and
conditions of this Agreement or any Specific Agreement, MICROCELL shall
have the right to use, reproduce, copy, make, have made, sell,
distribute, perform and display any Work Product for commercial use by
MICROCELL and its Affiliates. Such use shall be royalty free, except as
provided by Section 7.3. For such purpose "use" shall consist of some
or all of the following:
o Exclusive right in Canada to operate, solely or in conjunction
with other software products for the purpose of providing its
subscriber customers with services in exchange for service fees
o Test, integrate, perform and run within its local area network
o Use, storage in memory or electronic form, physical transfer
from machine to machine, and execution of the Work Product in
object code in MICROCELL's or its Affiliates' own internal data
processing operations.
8.3 RIGHT TO MAKE COPIES. MICROCELL shall have the right to make copies of
the Work Product for archival, operational or backup purposes or for
such other purposes as
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NSCO may authorize. All titles, trademarks and copyright and restricted
rights notices shall be reproduced in any copies so made and shall be
subject to the terms of this Agreement.
8.4 OTHER NSCO SOFTWARE. To the extent any software, or derivative work
thereof, is produced or acquired by NSCO independent of its obligations
under a Specific Agreement but is nonetheless at the option of NSCO
incorporated in Work Product provided thereunder, and to the extent
NSCO has the right to do so without incurring liability of any kind to
third parties, and subject to the commercial terms set forth under the
relevant Specific Agreement, NSCO grants MICROCELL a non-transferable
and non-exclusive right and license to copy, make, have made, use and
sell, distribute, perform, and display such software in Canada for the
license term of the underlying Work Product.
8.5 TERM OF LICENSE. Unless otherwise provided in a Specific Agreement and
with limitations set forth in Section 8.4, license granted by this
Agreement shall remain in affect for a period of three years (3)
commencing on the date of acceptance of Work Product as set forth in
Section 4.2. Such term shall apply to all license granted by this
Agreement with the exception that the exclusivity of each Work Product
granted herein shall remain in effect only for two (2) years from its
date of acceptance.
8.6 MICROCELL'S RIGHTS CONTINGENT ON PAYMENT IN FULL. MICROCELL's rights
under Sections 8.2 through 8.5 above, with respect to a Specific
Agreement, are contingent upon its performance of its obligations under
that same Specific Agreement, as well as payment of the Minimum
Quarterly Charge, and no right or license is granted or conveyed by
NSCO to MICROCELL except when and as such obligations are performed.
8.7 PUBLICITY. Nothing in this Agreement shall be deemed to give either
Party any rights to use the other Party's trademarks or trade names
without the other Party's specific, written consent. Each Party shall
have the right to publicly refer to the other Party or the existence of
this Agreement in promotional materials, business plans, investment
memoranda, or announcements. Each party shall notify the other of such
references in advance.
8.8 ESCROW. NSCO agrees to deliver, upon MICROCELL's request, a sealed
package containing the relevant source code and related documentation
for any Work Product utilized for commercial operations by MICROCELL
for deposition with an agreed escrow agent in accordance with the terms
and conditions of a separate escrow agreement. NSCO shall, from time to
time, deposit with the escrow agent any and all updates and upgrades
and related documentation of such Work Product in accordance with said
agreement. MICROCELL will be entitled to request release and delivery
of the deposited source code if MICROCELL is entitled to terminate this
Agreement pursuant to Section 11.2. All costs of any such escrow
agreement shall be borne by MICROCELL.
9 CONFIDENTIALITY
9.1 EXCHANGES OF CONFIDENTIAL INFORMATION. All exchanges of Confidential
Information shall be made by or under the supervision of the Parties'
principal contacts. Confidential Information may be disclosed orally or
in writing. Written disclosures of Confidential Information shall be
conspicuously legended "Confidential Information" (or terms of similar
meaning) and shall provide reasonable identification of the information
considered confidential.
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9.2 CARE AND PROTECTION. Each Party shall protect the other Party's
Confidential Information with reasonable effort using the same standard
of care that applies to its own similar Confidential Information.
9.3 EXCEPTIONS. Either Party may use or disclose the other Party's
Confidential Information if required by any request or order of any
government authority, or otherwise as required by law, or as necessary
to establish and enforce that Party's rights under this Agreement.
Before disclosing the other Party's Confidential Information for such
purpose, reasonable effort must be made to notify the other Party of
the circumstances, and the Parties shall cooperate with each other to
obtain protection for the confidentiality thereof to the extent
available.
10 LIABILITY AND LIMITATIONS OF LIABILITY
10.1 LIABILITY. Each Party will be liable for any damage to person or
property caused to the other by willfulness or gross negligence during
the performance of any Work Product.
10.2 DISCLAIMER OF WARRANTIES. Except as expressly provided in this
Agreement or any Specific Agreement, all service provided and
deliveries made under each Specific Agreement are provided "AS IS,"
without warranty of any kind, including (without limitation) any
warranty of title, merchantability or fitness for a particular purpose.
Descriptions or specifications of deliverables shall constitute project
objectives and not express warranties.
10.3 LIMITATION OF LIABILITY. Unless otherwise expressly stated in a
Specific Agreement, the sole remedy for any delay or deficiency in
performance of any service or delivery obligation shall be termination
of the applicable Specific Agreement and equitable enforcement of any
delivery obligation for Work Product already completed.
10.4 EXCLUSION OF CERTAIN DAMAGES. IN NO EVENT SHALL EITHER PARTY BE LIABLE
FOR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSS OF
PROFITS, LOSS OF USE OF DATA OR INTERRUPTION OF BUSINESS, WHETHER SUCH
ALLEGED DAMAGES ARE ALLEGED IN TORT, CONTRACT OR INDEMNITY, EVEN IF
SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
10.5 INTELLECTUAL PROPERTY INDEMNITY. Except as provided in Section 8.4,
NSCO represents and warrants that it has all rights and licenses
necessary to grant the rights and licenses set out herein and in any
Specific Agreement and that to the best knowledge of NSCO the use of
the Work Products shall not constitute an infringement of any patents
or any other industrial and intellectual property rights belonging to
NSCO or any third party. NSCO shall indemnify and hold MICROCELL
harmless with respect to all liabilities or losses suffered by
Microcell, including, without limitation, reasonable attorneys fees
arising out of any claim, lawsuit or judgment from third parties in
respect of infringement of the intellectual property rights of a Work
Product. If any legal proceeding is instituted or any claim or demand
is asserted by a third party against Microcell (each a "Third Party
Claim"), the parties shall cooperate in good faith in order to solve
the Third Party Claim. NSCO shall have the right to defend the Third
Party Claim at its own cost and expense with counsel of its own
selection. If NSCO fails to defend a Third Party Claim, Microcell shall
have the right (but not the obligation) upon a fifteen (15) days prior
written notice to undertake the defense of the Third Party Claim.
<PAGE> 12
12(17)
11 TERM OF AGREEMENT
11.1 TERM. This Agreement shall be effective upon the date specified at the
beginning of this Agreement ("Effective Date"), and shall remain in
force for a period of three (3) years, unless otherwise terminated as
provided herein; provided, however, the general terms of this Agreement
(excluding, for greater certainty, Section 7.3) shall continue to
remain in effect with respect to any Specific Agreement entered into
hereunder until such Specific Agreement is itself terminated or
performance thereunder is completed.
11.2 TERMINATION OF THIS AGREEMENT. Either Party may terminate this
Agreement immediately upon notice in writing to the other Party if such
other Party becomes insolvent or a petition under any laws of or
relating to bankruptcy, insolvency, reorganization or relief of debtors
will be filed by that Party or if either Party executes an assignment
for the benefit of creditors, or if a receiver, custodian, liquidator
or trustee is appointed for that Party, or if either Party seeks or
requests any such appointment, or if either Party takes any corporate
action to authorize any of the foregoing actions, or if any case,
proceeding or other action against either Party is commenced and not
dismissed within ninety (90) days seeking to have an order entered
against it as a debtor under any law of or relating to bankruptcy,
insolvency, reorganization or relief of debtors or seeking appointment
of a receiver, trustee, custodian or similar official for it or for any
substantial part of its property.
11.3 TERM OF CONFIDENTIALITY. Each Party's obligation to protect the other
Party's Confidential Information shall expire three (3) years after the
date of first disclosure thereof.
11.4 SURVIVAL. Notwithstanding any termination of this Agreement or a
Specific Agreement, the provisions of Sections 8.1, 9, 10, 11 and 12
shall remain in effect.
12 MISCELLANEOUS
12.1 NON-SOLICITATION. Both Parties agree not to, during the term of this
agreement and for a period of one year succeeding the termination of
this Agreement, hire or actively seek the employment of any employee of
the other Party unless agreed to in writing by that Party.
12.2 FORCE MAJEURE. Either Party shall be excused from delays in performing
or from its failure to perform hereunder to the extent that such delays
or failures result from causes beyond the reasonable control of such
Party; provided that, in order to be excused from delay or failure to
perform, such Party must act diligently to remedy the cause of such
delay or failure.
12.3 NO AGENCY. NSCO, in rendering performance under Specific Agreements
issued hereunder from time to time, is acting solely as an independent
contractor. MICROCELL does not undertake by this Agreement or otherwise
to perform any obligation of NSCO, whether by regulation or contract.
In no way is NSCO to be construed as the agent or acting as the agent
of MICROCELL in any respect, any other provisions of this Agreement or
any Specific Agreements issued hereunder notwithstanding.
12.4 AFFILIATES. In undertaking and performing their respective obligations
under this Agreement, each Party shall be entitled to act through or on
behalf of its Affiliates, and shall be entitled to sublicense or assign
its rights and obligations under this Agreement to its Affiliates, in
whole or in part, provided that the Party so doing shall remain
responsible to the other Party for the full performance of any such
obligations as required by this Agreement.
<PAGE> 13
13(17)
12.5 SEVERABILITY. If any provision of this Agreement is held to be invalid,
the other provisions will not be affected to the greatest extent
possible consistent with the Parties' intent.
12.6 SECTION HEADINGS; EXHIBITS. The section and subsection headings used
herein are for reference and convenience only, and shall not enter into
the interpretation hereof. The exhibits referred to herein and attached
hereto, or to be attached hereto, including all Specific Agreements
issued hereunder from time to time, are incorporated herein to the same
extent as if set forth in full herein.
12.7 REQUIRED APPROVALS. Where agreement, approval, acceptance, or consent
by either Party is required by any provision of this Agreement, such
action shall not be unreasonably delayed or withheld.
12.8 COMPLIANCE WITH LAW. Each Party agrees to comply with all applicable
laws, regulations, and ordinances relating to their performance
hereunder.
12.9 PROTECTION OF INTELLECTUAL PROPERTY RIGHTS. The Parties agree to
cooperate with each other in their efforts to obtain available
protection for any Intellectual Property Rights under foreign laws and
to secure such certifications, registrations or licenses as may be
appropriate for the protection of the same in any country.
12.10 EXPORT RESTRICTIONS. Neither Party will knowingly export or re-export,
directly or indirectly, any technical data (as defined by the U.S.
Export Administration Regulations) produced or provided under this
Agreement, or export or re-export, directly or indirectly, any direct
product of such technical data, including software, to a destination to
which such export or re-export is restricted or prohibited by U.S. or
non-U.S. law, without obtaining prior authorization from U.S.
Department of Commerce and other competent government authorities to
the extent required by those laws.
12.11 NO WAIVER. No delay or omission by either Party hereto to exercise any
right or power occurring upon any noncompliance or default by the other
Party with respect to any of the terms of this Agreement shall impair
any such right or power or be construed to be a waiver thereof. A
waiver by either of the Parties hereto of any of the covenants,
conditions, or agreements to be performed by the other shall not be
construed to be a waiver of any succeeding breach thereof or of any
covenant, condition, or agreement herein contained. Unless stated
otherwise, all remedies provided for in this Agreement shall be
cumulative and in addition to and not in lieu of any other remedies
available to either party at law, in equity, or otherwise.
12.12 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the Province of Quebec, Canada.
12.13 DISPUTE RESOLUTION. Each Party agrees that, unless otherwise required
in order to comply with deadlines under the law, it will not file
action or institute legal proceedings with respect to any dispute,
controversy, or claim arising out of, relating to, or in connection
with, this Agreement, until:
o it has given the other Party written notice of its grievance;
o the other Party has failed to provide a prompt and effective
remedy;
o it has requested that senior executives for both Parties meet
and discuss the matter in order to consider informal and
amicable means of resolution; and
<PAGE> 14
14(17)
o either such meeting failed to occur within thirty (30) days
after such request or the meeting did not produce a mutually
satisfactory resolution of the matter.
12.14 ENTIRE AGREEMENT. This Agreement and the exhibits annexed hereto,
together with the Specific Agreements issued from time to time
hereunder, constitute the entire agreement between the Parties and
supersedes all prior agreements. No change, waiver, or discharge hereof
shall be valid unless it is in writing and is executed by the Party
against whom such change, waiver, or discharge is sought to be
enforced.
12.15 NO ASSIGNMENT. Except as provided by Section 12.4, neither Party may,
without the prior written consent of the other Party, assign or
transfer this Agreement or any obligation incurred hereunder, except by
merger, reorganization, consolidation, or sale of all or substantially
all of such Party's assets. Any attempt to do so in contravention of
this Section shall be void and of no force and effect.
IN WITNESS WHEREOF, MICROCELL and NSCO have caused this Agreement to be
signed and delivered by their duly authorized officers, all as of the
date first hereinabove written.
MICROCELL LABS INC. 3044016 NOVA SCOTIA COMPANY
By: /s/ MARC FERLAND By: /s/ MARC FERLAND
-------------------------------- --------------------------------
Title: Vice President Title: President
----------------------------- -----------------------------
<PAGE> 15
15(17)
EXHIBIT (A)
OUTLINE OF SPECIFIC AGREEMENT
1. GENERAL
Identification of Parties & Date of Execution
Reference to General Co-operation And Development Agreement by date and
title
2. NAMES OF TECHNICAL COORDINATORS
3. SUMMARY OF PURPOSE FOR STATEMENT OF WORK
General description of work or services
General description of preexisting works, if any
4. IDENTIFICATION OF PREEXISTING WORKS. OWNERSHIP AND LICENSE.
5. EQUIPMENT AND PROGRAMMING TO BE PROVIDED BY MICROCELL, IF ANY
6. OTHER NSCO RESOURCES
If desired, provide for the NSCO's commitment of its own staff,
facilities and other resources by nature or item
7. DESCRIPTION OF DELIVERABLES
Include functional and technical Specifications of Code and
Documentation, and refer to any specific Enhancements that may be
sought.
Describe prototype or components to be delivered.
Include as Deliverables copies of the reports of all project reviews,
inspections, and tests conducted during the course of performance.
Provide for treatment of Source Code or Development Environment.
8. SPECIAL TERMS (IF ANY)
9. MODE OF PAYMENT
10. PAYMENT SCHEDULE
MICROCELL will pay NSCO for the work in accordance with the following
payment schedule. All payments to NSCO are contingent on NSCO's
satisfying the Deliverables/Milestones set forth in the Payment
Schedule. Payments shall be made upon MICROCELL's written confirmation
to __________________ that the Deliverables/Milestones have been
satisfied.
<PAGE> 16
16(17)
DATE AMOUNT DELIVERABLE/MILESTONES
---- ------ ----------------------
(Current
Schedule)
______ Statement of Work Executed
______ Project Management Plan Completed and Delivered
______ Specifications Accepted
______ Prototype Delivered
______ Testing and Debugging Completed
______ Code Delivered
______ Documentation Delivered
______ Acceptance
11. SCHEDULE AND PERFORMANCE MILESTONES
This Schedule sets forth the target dates and performance milestones
for the preparation and delivery of the Deliverables by NSCO.
<TABLE>
<CAPTION>
Responsible Target
Performance Milestone Party Date
--------------------- ----------- ------
<S> <C> <C>
MICROCELL and NSCO meet to prepare MICROCELL/NSCO ________, 20__
the Functional Specifications and
test procedures
Project Management Plan completed NSCO ________, 20__
Development work to begin NSCO ________, 20__
Prototype to MICROCELL NSCO ________, 20__
Testing and Debugging NSCO ________, 20__
Acceptance and Final Delivery MICROCELL/NSCO ________, 20__
</TABLE>
<PAGE> 17
17(17)
12. ACCEPTANCE AND TESTING PROCEDURES
Component Tests
System Tests
Acceptance Tests
(in each case, involving both quality and function)
13. LOCATION OF WORK FACILITIES
Substantially all of the work will be conducted by NSCO at its regular
office located in
MICROCELL will provide the MICROCELL office space and support as it
agrees may be appropriate, at its _____________ facility.
14. IP INDEMNIFICATION
