Internet Services Agreement - Netgateway and Bergen Brunswig Drug Co.
NETGATEWAY
INTERNET SERVICES AGREEMENT
THIS INTERNET SERVICES AGREEMENT (this "AGREEMENT") is made effective
as of the Acceptance Date set forth in the initial Internet Services Order Form
(October 25, 1999) accepted by Netgateway, a Nevada corporation ("NETGATEWAY"),
and the subscriber identified below ("SUBSCRIBER").
PARTIES:
SUBSCRIBER NAME: BERGEN BRUNSWIG DRUG COMPANY
ADDRESS: 4000 METROPOLITAN DRIVE
ORANGE, CA 92868
PHONE: (714) 385-4000
FAX: (714) 704-7034
NETGATEWAY, INC.
300 Oceangate, Suite 500
Long Beach, CA 90802
Phone: (562) 308-0010
Fax: (562) 308-0021
1. INTERNET SERVICES.
1.1 INTERNET SERVICES. Subject to the terms and conditions of this
Agreement, during the term of this Agreement, Netgateway will, through the
Netgateway Internet Commerce Center-TM- ("NETGATEWAY ICC") provide to Subscriber
the services described in the Internet Services Order Form(s) (the "INTERNET
SERVICES ORDER FORM(S)") accepted by Netgateway, or substantially similar
services if such substantially similar services would provide Subscriber with
substantially similar benefits (the "INTERNET SERVICES"). All such Internet
Services Order Forms will be incorporated herein by this reference as of the
Acceptance Date set forth in each such form. Netgateway and Subscriber have
mutually agreed or will mutually agree upon the detailed final specifications
(the "SPECIFICATIONS") for the Internet Services and the development timeline
therefor, all of which are or will be set forth on the attached initial Internet
Services Order Form, marked Exhibit "A", and by this reference made a part
hereof.
1.2 AVAILABILITY. Internet Services will be available to Subscriber for
inquiry and order entry functions twenty-four (24) hours a day, seven (7) days a
week. Netgateway reserves the right upon reasonable notice to Subscriber to
limit or curtail holiday or weekend availability when necessary for system
upgrades, adjustments, maintenance, or other operational considerations.
1.3 ENHANCEMENTS. General enhancements to existing Internet Services
provided hereunder, as well as new features that Netgateway incorporates into
its standard commerce processing system, regardless of whether they are
initiated by Netgateway or developed at the request of Subscriber or other
subscribers, shall be made available to Subscriber at no additional cost. Any
new features or services that may be developed by Netgateway during the term of
this Agreement that Netgateway intends to offer to Subscriber on a limited or
optional basis may, at Netgateway' option, and subject to Subscriber's
acceptance, be made available to Subscriber at Netgateway's then-current prices
for such new features or services. Enhancements to existing Internet Services
requested by Subscriber that benefit only Subscriber at the time such
enhancements are put into service shall be billed to Subscriber at Netgateway's
standard rates for programming. All enhancements to the Internet Services, and
any new features or services introduced by Netgateway, shall remain the
exclusive proprietary property of Netgateway.
1.4 TRAINING. At no cost to Subscriber, Netgateway shall provide such
onsite training and other assistance, as Netgateway deems necessary to assure
that Subscriber's personnel are able to make effective use of the Internet
Services. On-site training shall take place at such times and places as are
mutually agreeable to the parties hereto.
1.5 SUBSCRIBER DATA.
(a) SUBSCRIBER DATA. Subscriber will timely supply Netgateway, in a
form acceptable to Netgateway, with all data necessary for Netgateway to perform
the ongoing services to be provided hereunder. It is the sole responsibility of
Subscriber to insure the completeness and accuracy of such data.
(b) CONFIDENTIALITY. Netgateway acknowledges that all records, data,
files and other input material relating to Subscriber are confidential and shall
take reasonable steps to protect the confidentiality of such records, data,
files and other materials. Netgateway will provide reasonable security
safeguards to limit access to Subscriber's files and records to Subscriber and
other authorized parties.
(c) PROTECTION OF SUBSCRIBER FILES. Netgateway will take reasonable
steps to protect against the loss or alteration of Subscriber's files, records
and data retained by Netgateway, but Subscriber recognizes that events beyond
the control of Netgateway may cause such loss or alteration. Netgateway will
maintain backup file(s) containing all the data, files and records related to
Subscriber. Subscriber's file(s), records and data shall, at no cost to
Subscriber, be released to Subscriber on an occurrence that renders Netgateway
unable to perform hereunder, or upon the termination of this Agreement as
provided herein.
(d) OWNERSHIP OF DATA. Netgateway acknowledges that all records, data,
files and other input material relating to Subscriber and its customers,
including derivative material prepared from such material, are the exclusive
property of the Subscriber. It is the parties' intention that all rights in such
derivative material will vest in Subscriber as works made for hire for inclusion
in Subscriber's collective works under copyright laws of the United States. If,
for any reason, such works are not considered works made for hire, Netgateway
hereby grants and assigns to Subscriber its rights in such derivative material.
The foregoing is not applicable to the parties' rights to design layouts,
templates, displays and icons and/or functional, technical and system
specifications created by Netgateway for Subscriber, which rights will shall be
the property of Netgateway, and which may be licensed by Netgateway to
Subscriber pursuant to the terms of Section 10(b) hereof.
2. FEES AND BILLING.
2.1 FEES. Subscriber will pay all fees and amounts in accordance with
the Internet Service Order Forms.
2.2 BILLING COMMENCEMENT. Billing for Internet Services indicated in
the Internet Services Order Forms, other than the Initial Development Fee, if
any, shall commence on the "OPERATIONAL DATE" indicated in the Internet
Services Order Forms. In the event that Subscriber orders other Internet
Services in addition to those listed in the initial Internet Services Order
Form, billing for such services shall commence on the date Netgateway first
provides such additional Internet Services to Subscriber or as otherwise
agreed to by Subscriber and Netgateway in the applicable Internet Services
Order Form.
2.3 BILLING AND PAYMENT TERMS. Netgateway shall invoice Subscriber
monthly in advance of the provision of Internet Commerce Services, and payment
of such fees will be due within thirty (30) days of the date of each Netgateway
invoice. All payments will be made in U.S. dollars. Late payments hereunder will
accrue interest at a rate of one and one-half percent (1 1/2%) per month, or the
highest rate allowed by applicable law, whichever is lower. If in its reasonable
judgment Netgateway determines that Subscriber is not creditworthy or is
otherwise not financially secure, Netgateway may, upon prior written notice to
Subscriber, modify the payment terms to require full payment before the
provision of Internet Services or other assurances to secure Subscriber's
payment obligations hereunder.
2.4 TAXES, UTILITIES AND EXCLUSIONS. All charges shall be exclusive of
any federal, state or local sales, use, excise, AD VALOREM or personal property
taxes levied, or any fines, forfeitures or penalties assessed in connection
therewith, as a result of this Agreement or the installation or use of Internet
Services hereunder. Any such taxes, which may be applicable will be paid by
Subscriber or by Netgateway for Subscriber's account, in which case Subscriber
shall reimburse Netgateway for amounts so paid. Netgateway will provide traffic
reports to Subscriber with respect to burstible capacity. Netgateway is not
responsible for providing connectivity to Subscriber's offices.
3. SUBSCRIBER'S OBLIGATIONS.
3.1 COMPLIANCE WITH LAW AND RULES AND REGULATIONS. Subscriber agrees
that Subscriber will comply at all times with all applicable laws and
regulations and Netgateway's general rules and regulations relating to its
provision of Internet Services, currently included herein as Section 10, which
may be updated and provided by Netgateway to Subscriber from time to time
("RULES AND REGULATIONS"). Subscriber acknowledges that Netgateway exercises no
control whatsoever over the content contained in or passing through the
Subscriber's web site or mall ("INTERNET CENTERS"), and that it is the sole
responsibility of Subscriber to ensure that the information it transmits and
receives complies with all applicable laws and regulations.
3.2 ACCESS AND SECURITY. Subscriber will be fully responsible for any
charges, costs, expenses (other than those included in the Internet Services),
and third party claims that may result from its use of, or access to, the
Netgateway Internet Commerce Center-TM-, including, but not limited to, any
unauthorized use or any access devices provided by Netgateway hereunder.
3.3 NO COMPETITIVE SERVICES. Subscriber may not at any time permit any
Internet Services to be utilized for the provision of any services that compete
with any Netgateway services, without Netgateway's prior written consent.
3.4 INSURANCE.
(a) MINIMUM SUBSCRIBER LEVELS. Subscriber will keep in full force and
effect during the term of this Agreement: (i) comprehensive general liability
insurance in an amount not less than $5 million per occurrence for bodily injury
and property damage; (ii) employer's liability insurance in an amount not less
than $1 million per occurrence; and
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(iii) workers' compensation insurance in an amount not less than that
required by applicable law. Subscriber also agrees that it will be solely
responsible for ensuring that its agents (including contractors and
subcontractors) maintain, other insurance at levels no less than those
required by applicable law and customary in Subscriber's industries.
(b) MINIMUM NETGATEWAY LEVELS. Netgateway will keep in full force and
effect during the term of this Agreement: (i) comprehensive general liability
insurance in an amount not less than $1 million per occurrence for bodily injury
and property damage; (ii) employer's liability insurance in an amount not less
than $1 million per occurrence; and (iii) workers' compensation insurance in an
amount not less than that required by applicable law. Netgateway also agrees
that it will be solely responsible for ensuring that its agents (including
contractors and subcontractors) maintain, other insurance at levels no less than
those required by applicable law and customary in Netgateway's industry.
(c) CERTIFICATES OF INSURANCE. Prior to the Operational Date, each
party will furnish to the other certificates of insurance which evidence the
minimum levels of insurance set forth above, and will notify the other party in
writing in the event that any such insurance policies are cancelled.
(d) NAMING PARTIES AS ADDITIONAL INSUREDS. Each of Subscriber and
Netgateway agrees that prior to the Operational Date, it will cause its
insurance provider(s) to name the other party as an additional insured and
notify the other party in writing as of the effective date thereof.
4. CONFIDENTIAL INFORMATION.
4.1 CONFIDENTIAL INFORMATION. Each party acknowledges that it will have
access to certain confidential information of the other party concerning the
other party's business, plans, customers, technology, and products, including
the terms and conditions of this Agreement ("CONFIDENTIAL INFORMATION").
Confidential Information will include, but not be limited to, each party's
proprietary software and customer information. Each party agrees that it will
not use in any way, for its own account or the account of any third party,
except as expressly permitted by this Agreement, nor disclose to any third party
(except as required by law or to that party's attorneys, accountants and other
advisors as reasonably necessary), any of the other party's Confidential
Information and will take reasonable precautions to protect the confidentiality
of such information.
4.2 EXCEPTIONS. Information will not be deemed Confidential Information
hereunder if such information: (i) is known to the receiving party prior to
receipt from the disclosing party directly or indirectly from a source other
than one having an obligation of confidentiality to the disclosing party; (ii)
becomes known (independently of disclosure by the disclosing party) to the
receiving party directly or indirectly from a source other than one having an
obligation of confidentiality to the disclosing party; (iii) becomes publicly
known or otherwise ceases to be secret or confidential, except through a breach
of this Agreement by the receiving party; or (iv) is independently developed by
the receiving party.
5. REPRESENTATIONS AND WARRANTIES.
5.1 WARRANTIES BY SUBSCRIBER.
(a) SUBSCRIBER'S BUSINESS. Subscriber represents and warrants that:
(i) Subscriber's services, products, materials, data, and
information used by Subscriber in connection with this Agreement as well as
Subscriber's and its permitted customers' and users' use of the eCommerce
Services (collectively, "SUBSCRIBER'S BUSINESS") does not as of the
Operational Date, and will not during the term of this Agreement, operate in
any manner that would violate any applicable law or regulation.
(ii) Subscriber owns or has the right to use all material
contained in the Subscriber's web site, including all text, graphics, sound,
video, programming, scripts, and applets; and
(iii) The use, reproduction, distribution, and transmission of
the web site, or any information or materials contained in it does not (A)
infringe or misappropriate any copyright, patent, trademark, trade secret, or
any other proprietary rights of a third party; or (B) constitute false
advertising, unfair competition, defamation, an invasion of privacy, or
violate a right of publicity.
(b) RULES AND REGULATIONS. Subscriber has read the Rules and
Regulations (Section 10 below) and represents and warrants that Subscriber and
Subscriber's Business are currently in full compliance with the Rules and
Regulations, and will remain so at all times during the term of this Agreement.
(c) BREACH OF WARRANTIES. In the event of any breach, or reasonably
anticipated breach, of any of the foregoing warranties, in addition to any other
remedies available at law or in equity, Netgateway will have the right
immediately in Netgateway's reasonable discretion, to suspend any related
eCommerce Services if deemed reasonably necessary by Netgateway to prevent any
harm to Netgateway or its business.
5.2 WARRANTIES AND DISCLAIMERS BY NETGATEWAY.
(a) NO OTHER WARRANTY. THE INTERNET SERVICES ARE PROVIDED ON AN "AS IS"
BASIS, AND SUBSCRIBER'S USE OF THE INTERNET SERVICES IS AT ITS OWN RISK.
NETGATEWAY DOES NOT MAKE, AND HEREBY DISCLAIMS, ANY AND ALL OTHER EXPRESS AND/OR
IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT AND TITLE,
AND ANY WARRANTIES ARISING FROM A COURSE OF DEALING, USAGE, OR TRADE PRACTICE.
NETGATEWAY DOES NOT WARRANT THAT THE ECOMMERCE SERVICES WILL BE UNINTERRUPTED,
ERROR-FREE OR COMPLETELY SECURE.
(b) DISCLAIMER OF ACTIONS CAUSED BY AND/OR UNDER THE CONTROL OF THIRD
PARTIES. NETGATEWAY DOES NOT AND CANNOT CONTROL THE FLOW OF DATA TO OR FROM
NETGATEWAY'S INTERNET COMMERCE CENTER AND OTHER PORTIONS OF THE INTERNET. SUCH
FLOW DEPENDS IN LARGE PART ON THE PERFORMANCE OF INTERNET SERVICES PROVIDED OR
CONTROLLED BY THIRD PARTIES. AT TIMES, ACTIONS OR INACTIONS CAUSED BY THESE
THIRD PARTIES CAN PRODUCE SITUATIONS IN WHICH NETGATEWAY'S SUBSCRIBERS'
CONNECTIONS TO THE INTERNET (OR PORTIONS THEREOF) MAY BE IMPAIRED OR DISRUPTED.
ALTHOUGH NETGATEWAY WILL USE COMMERCIALLY REASONABLE EFFORTS TO TAKE ACTIONS IT
DEEMS APPROPRIATE TO REMEDY AND AVOID SUCH EVENTS, NETGATEWAY CANNOT GUARANTEE
THAT THEY WILL NOT OCCUR. ACCORDINGLY, NETGATEWAY DISCLAIMS ANY AND ALL
LIABILITY RESULTING FROM OR RELATED TO SUCH EVENTS.
6. LIMITATIONS OF LIABILITY.
6.1 EXCLUSIONS. EXCEPT AS OTHER WISE PROVIDED HEREIN, IN NO EVENT WILL
EITHER PARTY BE LIABLE TO THE OTHER OR TO ANY THIRD PARTY FOR ANY CLAIMS ARISING
OUT OF OR RELATED TO THIS AGREEMENT, SUBSCRIBER'S BUSINESS OR OTHERWISE, AND ANY
LOST REVENUE, LOST PROFITS, REPLACEMENT GOODS, LOSS OF TECHNOLOGY, RIGHTS OR
SERVICES, SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT OR CONSEQUENTIAL DAMAGES, LOSS
OF DATA, OR INTERRUPTION OR LOSS OF USE OF SERVICE OR SUBSCRIBER'S BUSINESS,
EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER UNDER THEORY OF
CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR OTHERWISE.
6.2 LIMITATIONS. NETGATEWAY, ITS AFFILIATES, EMPLOYEES, OFFICERS AND
AGENTS SHALL NOT BE LIABLE TO SUBSCRIBER OR TO ANY THIRD PARTY FOR ANY LOSS OR
DAMAGE, WHETHER DIRECT OR INDIRECT, RESULTING FROM DELAYS OR INTERRUPTIONS OF
SERVICE DUE TO MECHANICAL ELECTRICAL OR WIRE DEFECTS OR DIFFICULTIES, STORMS,
STRIKES, WALK-OUTS, EQUIPMENT OR SYSTEMS FAILURES, OR OTHER CAUSES (EXCEPT
FINANCIAL) OVER WHICH NETGATEWAY, ITS AFFILIATES, EMPLOYEES, OFFICERS, OR AGENTS
AGAINST WHOM LIABILITY IS SOUGHT, HAVE NO REASONABLE CONTROL, OR FOR LOSS OR
DAMAGE, DIRECT OR INDIRECT, RESULTING FROM INACCURACIES, ERRONEOUS STATEMENTS,
ERRORS OF FACTS, OMISSIONS, OR ERRORS IN THE TRANSMISSION OR DELIVERY OF
INTERNET SERVICES, OR ANY DATA PROVIDED AS A PART OF THE INTERNET SERVICES
PURSUANT TO THIS AGREEMENT, EXCEPT TO THE EXTENT CAUSED BY THE NEGLIGENCE OR
WILFUL MISCONDUCT OF NETGATEWAY.
6.3 MAXIMUM LIABILITY. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS
AGREEMENT, NETGATEWAY'S MAXIMUM AGGREGATE LIABILITY TO SUBSCRIBER RELATED TO OR
IN CONNECTION WITH THIS AGREEMENT WILL BE LIMITED TO THE TOTAL AMOUNT PAID BY
SUBSCRIBER TO NETGATEWAY HEREUNDER.
6.4 TIME FOR MAKING CLAIMS. ANY SUIT OR ACTION BY SUBSCRIBER AGAINST
NETGATEWAY, ITS AFFILIATES, OFFICERS, DIRECTORS, AGENTS EMPLOYEES, SUCCESSORS OR
ASSIGNS, BASED UPON ANY ACT OR OMISSION ARISING OUT OF OR RELATING TO THIS
AGREEMENT, OR SERVICES PERFORMED HEREUNDER, OR ANY ALLEGED BREACH THEREOF, SHALL
BE COMMENCED WITHIN TWO (2) YEARS OF THE OCCURRENCE GIVING RISE TO SUCH CLAIM OR
BE FOREVER BARRED. THIS PROVISION DOES NOT MODIFY OR OTHERWISE AFFECT THE
LIMITATION OF NETGATEWAY'S LIABILITY SET FORTH IN SECTION 6 OR ELSEWHERE IN THIS
AGREEMENT.
6.5 SUBSCRIBER'S INSURANCE. [Reserved.]
6.6 BASIS OF THE BARGAIN; FAILURE OF ESSENTIAL PURPOSE. Subscriber
acknowledges that Netgateway has set its prices and entered into this Agreement
in reliance upon the limitations of liability and the disclaimers of warranties
and damages set forth herein, and that the same form an essential basis of the
bargain between the parties. The parties agree that the limitations and
exclusions of liability and disclaimers specified in this Agreement will survive
and apply even if found to have failed of their essential purpose.
7. INDEMNIFICATION.
7.1 NETGATEWAY'S INDEMNIFICATION OF SUBSCRIBER.
(a) Netgateway will indemnify, defend and hold Subscriber, its
directors, officers, affiliates, employees and agents harmless from and against
any and all third party claims for any costs, liabilities, losses and expenses
(including, but not limited to, reasonable attorneys' fees) resulting from or
arising out of Netgateway's breach of any provision of this Agreement.
(b) Netgateway will indemnify, defend and hold Subscriber harmless from
and against any and all costs, liabilities, losses and expenses (including, but
not limited to, reasonable attorneys' fees) (collectively, "LOSSES") resulting
from any claim, suit, action, or proceeding (each, an "ACTION") brought against
Subscriber alleging the infringement of any third party registered U.S.
copyright or issued U.S. patent resulting from the provision of Internet
Services pursuant to this Agreement (but excluding any infringement
contributorily caused by Subscriber's Business).
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7.2 SUBSCRIBER'S INDEMNIFICATION OF NETGATEWAY. Subscriber will
indemnify, defend and hold Netgateway, its affiliates and customers harmless
from and against any and all Losses resulting from or arising out of
Subscriber's breach of any provision of this Agreement or any Action brought
against Netgateway, its directors, employees, affiliates or Subscribers alleging
with respect to the Subscriber's Business: (a) infringement or misappropriation
of any intellectual property rights; (b) defamation, libel, slander, obscenity,
pornography or violation of the rights of privacy or publicity; (c) spamming, or
any other offensive, harassing or illegal conduct or violation of the Rules and
Regulations; or (d) any violation of any other applicable law or regulation.
7.3 NOTICE. Each party will provide the other party, prompt written
notice of the existence of any such event of which it becomes aware, and an
opportunity to participate in the defense thereof.
8. DISPUTE RESOLUTION.
8.1 PROCEDURES. It is the intent of the parties that all disputes
arising under this Agreement be resolved expeditiously, amicably, and at the
level within each party's organization that is most knowledgeable about the
disputed issue. The parties understand and agree that the procedures outlined in
this Paragraph 8 are not intended to supplant the routine handling of inquiries
and complaints through informal contact with customer service representatives or
other designated personnel of the parties. Accordingly, for purposes of the
procedures set forth in this paragraph, a "DISPUTE" is a disagreement that the
parties have been unable to resolve by the normal and routine channels
ordinarily used for such matters. Before any dispute arising under this
Agreement, other than as provided in paragraph 8.5 below, may be submitted to
arbitration, the parties shall first follow the informal and escalating
procedures set forth below.
(a) The complaining party's representative will notify the other
party's representative in writing of the dispute, and the non-complaining party
will exercise good faith efforts to resolve the matter as expeditiously as
possible.
(b) In the event that such matter remains unresolved thirty (30) days
after the delivery of the complainant party's written notice, a senior
representative of each party shall meet or confer within ten (10) business days
of a request for such a meeting or conference by either party to resolve such
matter.
(c) In the event that the meeting or conference specified in (b) above
does not resolve such matter, the senior officer of each party shall meet or
confer within ten (10) business days of the request for such a meeting or
conference by either party to discuss and agree upon a mutually satisfactory
resolution of such matter.
(d) If the parties are unable to reach a resolution of the dispute
after following the above procedure, or if either party fails to participate
when requested, the parties may proceed in accordance with paragraph 8.2 below.
8.2 BINDING ARBITRATION. Except as provided in paragraph 8.5 below, any
dispute arising under this Agreement shall, after utilizing the procedures in
paragraph 8.1, be resolved by final and biding arbitration in Los Angeles,
California, before a single arbitrator selected by, and in accordance with the
rules of commercial arbitration of, the American Arbitration Association or as
otherwise provided in Paragraph 11.6. Each party shall bear its own costs in the
arbitration, including attorneys' fees, and each party shall bear one-half of
the cost of the arbitrator. Arbitrators will be bound to apply California law,
and where applicable, federal statutory law. The parties will be afforded a
reasonable period of time to conduct discovery prior to the arbitration. A court
reporter will be present at all arbitration proceedings in order to transcribe
them and such transcription will be the official record of such proceedings for
purposes of any judicial enforcement or review proceeding.
8.3 ARBITRATOR'S AUTHORITY. The arbitrator shall have the authority to award
such damages as are not prohibited by this Agreement and may, in addition and in
a proper case, declare rights and order specific performance, but only in
accordance with the terms of this Agreement. The arbitrators' decision will
specify the basis for any award and the types of damages awarded.
8.4 ENFORCEMENT OF ARBITRATOR'S AWARD. Any Party may apply to a court
of general jurisdiction to enforce a arbitrator's award, and if enforcement is
ordered, the party against which the order is issued shall pay the costs and
expenses of the other party in obtaining such order, including responsible
attorneys' fees.
8.5 ACCESS TO COURTS. Notwithstanding the provisions of paragraphs 8.1
and 8.2 above, any action by Netgateway to enforce its rights under Paragraph
10.3 of this Agreement or to enjoin any infringement of the same by Subscriber,
an action to compel compliance with Paragraph 4 or this Paragraph 8 or an action
seeking injunctive or equitable relief may be commenced in the state of federal
courts of Los Angeles, California, and each party consents to personal
jurisdiction and venue in such courts for such actions.
9. TERM AND TERMINATION.
9.1 TERM. This Agreement will be effective on the date first above
written and will terminate three (3) years ("INITIAL TERM") from the date
Subscriber begins processing live data through Netgateway ICC-TM-, unless
earlier terminated according to the provisions of this Section 9. This Agreement
will automatically renew for an additional term of one (1) year unless a party
hereto elects not to so renew and notifies the other party in writing of such
election by a date, which is six (6) months prior to the lapse of the Initial
Term.
9.2 TERMINATION. Either party will have the right to terminate this
Agreement if: (i) the other party breaches any material term or condition of
this Agreement and fails to cure such breach within ten (10) days after receipt
of written notice of the same, except in the case of failure to pay fees, which
must be cured within five (5) days after receipt of written notice, in which
case the non- breaching party may terminate this Agreement by giving the
breaching party ninety (90) days' written notice of its intent to terminate;
(ii) the other party becomes the subject of a voluntary petition in bankruptcy
or any voluntary proceeding relating to insolvency, receivership, liquidation,
or composition for the benefit of creditors; or (iii) the other party becomes
the subject of an involuntary petition in bankruptcy or any involuntary
proceeding relating to insolvency, receivership, liquidation, or composition for
the benefit of creditors, if such petition or proceeding is not dismissed within
sixty (60) days of filing.
9.3 NO LIABILITY FOR TERMINATION. Neither party will be liable to the
other for any termination or expiration of this Agreement in accordance with its
terms.
9.4 EFFECT OF TERMINATION. Upon the effective date of expiration or
termination of this Agreement: (a) Netgateway will immediately cease providing
the Internet Services; (b) any and all payment obligations of Subscriber under
this Agreement will become due immediately; and (c) within thirty (30) days
after such expiration or termination, each party will return all Confidential
Information of the other party in its possession at the time of expiration or
termination and will not make or retain any copies of such Confidential
Information except as required to comply with any applicable legal or accounting
record keeping requirement.
9.5 SURVIVAL. The following provisions will survive any expiration or
termination of the Agreement: Sections 2, 3, 4, 5, 6, 7, 8, 9 and 10.
10. USE OF INTERNET SERVICES - RULES AND REGULATIONS.
10.1 PROPRIETARY SYSTEMS. (a) Except as set forth in Section 10.1(b)
hereof, Subscriber acknowledges that the software systems utilized by Netgateway
in the provision of Internet Services hereunder, including all enhancements
thereto, and all screens and formats used in connection therewith are the
exclusive proprietary property of Netgateway, and Subscriber shall not publish,
disclose, display, provide access to or otherwise make available any Netgateway
software or products thereof, or any screens, formats, reports or printouts
used, provided, produced or supplied from or in connection therewith, to any
person or entity other than an employee of Subscriber without the prior written
consent of, and on terms acceptable to Netgateway, which consent shall not be
unreasonably withheld; provided, however, that Subscriber may disclose to a
governmental or regulatory agency or to customers of Subscriber any information
expressly prepared and acknowledge in writing by Netgateway as having been
prepared for disclosure to such governmental or regulatory agency or to such
customers. Neither party shall disclose Subscriber's use of Internet Services in
any advertising or promotional materials without the prior written consent to
such use, and approval of such materials, by the other.
(b) If Netgateway's business operations shall cease for any reason
other than in connection with a sale of all or substantially all of its capital
stock or assets, then solely with respect to the Internet Services that are
being provided to Subscriber pursuant to the eCommerce Services Order Form No. 1
(the "Licensed Services"), and at any time with respect to the license granted
under Paragraph 1.5(d), Netgateway hereby grants to Subscriber, subject to the
terms and conditions of this Agreement, the non-exclusive, non-transferable
right to use and to permit third parties to use in connection with providing
Internet services in perpetuity the software systems related to the Licensed
Services, including all software source for compiled programs, all stored
procedures and application files and databases and all documentation and
relevant explanations relating thereto.
10.2 USE OF SERVICES PERSONAL TO SUBSCRIBER. [RESERVED.]
10.3 SURVIVAL OF OBLIGATIONS. The obligations of this paragraph 10
shall survive termination of this Agreement. Subscriber understands that the
unauthorized publication or disclosure of any of Netgateway' software or copies
thereof, or the unauthorized use of Internet Services would cause irreparable
harm to Netgateway for which there is no adequate remedy at law. Subscriber
therefore agrees that in the event of such unauthorized disclosure or use,
Netgateway may, at its discretion and at Subscriber's expense, terminate this
Agreement, obtain immediate injunctive relief in a court of competent
jurisdiction, or take such other steps as it deems necessary to protect its
rights. If Netgateway, in its reasonable, good faith judgement, determines that
there is a material risk of such unauthorized disclosure or use, it may demand
immediate assurances, satisfactory to Netgateway, that there will be no such
unauthorized disclosure or use. In the absence of such assurance, Netgateway may
immediately terminate this Agreement and take such other steps as it deems
necessary. The rights of Netgateway hereunder are in addition to any other
remedies provided by law.
11. MISCELLANEOUS PROVISIONS.
11.1 FORCE MAJEURE. Except for the obligation to pay money, neither
party will be liable for any failure or delay in its performance under this
Agreement due to any cause beyond its reasonable control, including act of war,
acts of God, earthquake, flood, embargo, riot, sabotage, labor shortage or
dispute, governmental act or failure of the
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Internet, provided that the delayed party: (a) gives the other party prompt
notice of such cause; and (b) uses its reasonable commercial efforts to
correct promptly such failure or delay in performance.
11.2 NO LEASE. This Agreement is a services agreement and is not
intended to and will not constitute a lease of any real or personal property.
Subscriber acknowledges and agrees that (i) it has been granted only a license
to use Netgateway's ICC and any equipment provided by Netgateway in accordance
with this Agreement, (ii) Subscriber has not been granted any real property
interest in the Netgateway's ICC, and (iii) Subscriber has no rights as a tenant
or otherwise under any real property or landlord/tenant laws, regulations, or
ordinances.
11.3 MARKETING. Subscriber agrees that Netgateway may refer to
Subscriber by trade name, and may briefly describe Subscriber's Business, in
Netgateway's marketing materials and web site.
11.4 GOVERNMENT REGULATIONS. Subscriber will not export, re-export,
transfer, or make available, whether directly or indirectly, any regulated item
or information to anyone outside the U.S. in connection with this Agreement
without first complying with all export control laws and regulations which may
be imposed by the U.S. Government and any country or organization of nations
within whose jurisdiction Subscriber operates or does business.
11.5 NON-SOLICITATION. During the period beginning on the Operational
Data and ending on the first anniversary of the termination or expiration of
this Agreement in accordance with its terms, each of Subscriber and Netgateway
agrees that it will not, and will ensure that its affiliates do not, directly or
indirectly, solicit or attempt to solicit for employment any persons employed by
the other party to this Agreement during such period.
11.6 GOVERNING LAW; SEVERABILITY; WAIVER. This Agreement is made under
and will be governed by and construed in accordance with the laws of the State
of California (without regard to that body of law controlling conflicts of law)
and specifically excluding from application to this Agreement that law known as
the United Nations Convention on the International Sale of Goods. In the event
any provision of this Agreement is held by a tribunal of competent jurisdiction
to be contrary to the law, the remaining provisions of this Agreement will
remain in full force and effect. The waiver of any breach or default of this
Agreement will not constitute a waiver of any subsequent breach or default, and
will not act to amend or negate the rights of the waiving party.
11.7 ASSIGNMENT; NOTICES. Neither Netgateway nor Subscriber may assign
its rights or delegate its duties under this Agreement, either in whole or in
part, without prior written consent, except that either party may assign this
Agreement in whole as part of a corporate reorganization, consolidation, merger
or sale of substantially all of its assets. Any attempted assignment or
delegation without such consent will be void. This Agreement shall be binding
and inure to the benefit of each party's successors and permitted assigns. Any
notice or communication required or permitted to be given hereunder may be
delivered by hand, deposited with an overnight courier, sent by confirmed
facsimile, or mailed by registered or certified mail, return receipt requested,
postage prepaid, in each case to the address of the receiving party indicated on
the signature page hereof, or at such other address as may hereafter be
furnished in writing by either party hereto to the other. Such notice will be
deemed to have been given as of the date it is delivered, mailed or sent,
whichever is earlier.
11.8 RELATIONSHIP OF PARTIES. Netgateway and Subscriber are independent
contractors and this Agreement will not establish any relationship of
partnership, joint venture, employment, franchise or agency between Netgateway
and Subscriber. Neither Netgateway nor Subscriber will have the power to bind
the other or incur obligations on the other's behalf without the other's prior
written consent, except as otherwise expressly provided herein.
11.9 SUBCONTRACTORS. The provision of Internet Services hereunder shall
be completed by Netgateway. To the extent that Netgateway seeks to subcontract
all or a portion of the Internet Services to a third party provider, such
subcontractor shall be approved by Subscriber, which approval shall not be
unreasonable withheld.
11.10 NO CONFLICT. To the best of Netgateway's knowledge, there exists
no actual or potential conflict between Netgateway and Subscriber, in connection
with their business or the Internet Services. To the extent that such an actual
or potential conflict shall arise during the term of this Agreement, Netgateway
shall immediately inform Subscriber of such actual or potential conflict in
writing. To the best of Subscriber's knowledge, there exists no actual or
potential conflict between Netgateway and Subscriber, in connection with their
business or the Internet Services. To the extent that such an actual or
potential conflict shall arise during the term of this Agreement, Subscriber
shall immediately inform Netgateway of such actual or potential conflict in
writing.
11.11 EQUAL EMPLOYMENT OPPORTUNITY. Netgateway is an equal opportunity
employer. Netgateway has and shall continue to comply with all applicable
federal and state laws prohibiting discrimination in all aspects of its
business, including the provision of the Internet Services hereunder.
11.12 ENTIRE AGREEMENT; AMENDMENTS; COUNTERPARTS. This Agreement,
including all documents incorporated herein by reference, constitutes the
complete and exclusive agreement between the parties with respect to the subject
matter hereof, and supersedes and replaces any and all prior or contemporaneous
discussions, negotiations, understandings and agreements, written and oral,
regarding such subject matter. This Agreement shall not be amended or modified
except by a written agreement signed by the parties hereto; provided, however,
that Subscriber may amend the general scope of the Internet Services to be
provided hereunder upon thirty (30) days' written notice to Netgateway; and
provided further, that in the event of such amendment, the parties shall make
such adjustment to price and/or delivery as the parties shall deem necessary and
appropriate. This Agreement may be executed in two or more counterparts, each of
which will be deemed an original, but all of which together shall constitute one
and the same instrument.
Subscriber's and Netgateway's authorized representatives have read the
foregoing and all documents incorporated therein and agree and accept such
terms effective as of the date first above written.
SUBSCRIBER
Signature: Signature:
------------------------- --------------------------
Print Name: Print Name:
------------------------- ------------------------
Title:
-------------------------
NETGATEWAY
Signature: Signature:
------------------------- --------------------------
Print Name: Print Name:
------------------------- ------------------------
Title:
-------------------------
PAGE 4
<PAGE>
EXHIBIT "A"
INTERNET SERVICES ORDER FORM
<PAGE>
NETGATEWAY
INTERNET SERVICES ORDER FORM
CUSTOMER NAME: BERGEN BRUNSWIG CORPORATION
FORM DATE: OCTOBER 25, 1999
FORM NO.: 001
GENERAL INFORMATION:
1. By submitting this Internet Services Order Form ("FORM") to Netgateway,
Subscriber hereby places an order for the Internet Services described
herein pursuant to the terms and conditions of the Internet Services
Agreement between Subscriber and Netgateway (the "IS AGREEMENT").
2. Billing, with the exception of Development Fees, will commence on the
Operational Date set forth below or the date that Subscriber first
begins to process transactions through the Netgateway Internet Commerce
Center, whichever occurs first.
3. Netgateway will provide the Internet Services pursuant to the terms and
conditions of the IS Agreement, which incorporates this Form. The terms
of this Form supersede, and by accepting this Form Netgateway hereby
rejects, any conflicting or additional terms provided by Subscriber in
connection with Netgateway's provision of the Internet Services. If
there is a conflict between this Form and any other Form provided by
Subscriber and accepted by Netgateway, the Form with the latest date
will control.
4. Netgateway will not be bound by or required to provide Internet
Services pursuant to this Form or the IS Agreement until each is signed
by an authorized representative of Netgateway.
SUBSCRIBER HAS READ, UNDERSTANDS AND HEREBY SUBMITS THIS ORDER.
Submitted By: Operational Date:
---------------------------- ---------------
(AUTHORIZED SIGNATURE)
Print Name:
----------------------------
Title: ----------------------------
NETGATEWAY ACCEPTANCE
Date:
------------------------------------------- ----------------------------
(AUTHORIZED SIGNATURE:
<PAGE>
NETGATEWAY
INTERNET SERVICES ORDER FORM
CUSTOMER NAME: BERGEN BRUNSWIG CORPORATION
FORM DATE: OCTOBER 25, 1999
FORM NO.: 001
TERMS:
1. DEVELOPMENT FEES. The development fees for the Internet Services shall
be as set forth on the Statement of Work and Project Specifications
annexed hereto as Schedule 1, and shall be payable in accordance with
the terms set forth thereon.
2. PROJECT SPECIFICATIONS. A Statement of Work and Project Specifications
for the Internet Services is annexed hereto as Schedule 1 and
incorporated herein by this reference.
3. ADDITIONAL FEES. Additional fees, including without limitation,
pharmacy set-up fees, supported content changes and domain name
registrations shall be as set forth on Schedule 1 hereto.
4. DEVELOPMENT TIMELINE. Development of the Internet Services shall be
completed on or before December 31, 1999. Netgateway intends to begin
deploying on-line pharmacies immediately after December 31, 1999.
5. PUBLICITY. Both parties are public companies and can be affected by the
manner or content of public announcements concerning this relationship.
Neither party shall make any public announcement of this Agreement or
of the relationship they have entered into without the prior written
consent of the other.
SUBSCRIBER'S INITIALS ________
<PAGE>
SCHEDULE 1
STATEMENT OF WORK AND PROJECT SPECIFICATIONS
<PAGE>
PROJECT APPROACH AND SCOPE
In support of the myGNP.com objectives, an approach to activities, deliverables
and timing has been developed. We intend to execute this project in as rapid a
manner as possible in order to launch as many pharmacy sites as possible before
the end of the year.
The following timeline depicts major MYGNP.COM project activities with
appropriate milestones requiring client written approval:
[GRAPH]
The above timeline is very aggressive and will need to be carefully managed. In
order for the project to be completed on time and within budget, Netgateway will
require Bergen Brunswig's support and cooperation to prevent and resolve issues.
SCOPE
Requirements for the project were detailed in the RFP. These requirements are
listed below with any additional commentary. IF ADDITIONAL REQUIREMENTS ARE
UNCOVERED
<PAGE>
Schedule 1 - Statement of work and project specification page 2
DURING THE FIRST SET OF ACTIVITIES, THEY WILL BE SCOPED AND BILLED IN
ACCORDANCE TO THEIR COMPLEXITY. ADDITIONALLY, THEIR IMPACT ON THE TIMELINE WILL
BE COMMUNICATED BROADLY.
As defined, myGNP.com is a standalone system requiring no real-time interfaces
to production systems. The system will however be linked to other Bergen
Brunswig applications using http protocols. IF INTEGRATION POINTS ARE UNCOVERED,
THEY WILL BE SCOPED AND BILLED IN ACCORDANCE TO THEIR COMPLEXITY.
We will provide burstible at 1 megabit per second capacity bandwidth for Bergen
Brunswig's website at no additional charge. Should Bergen Brunswig need
additional bandwidth, we will provide or make arrangements to provide such
additional bandwidth to Bergen Brunswig at our cost and invoice Bergen Brunswig
for such excess bandwidth and/or use beyond a 1 megabit per second burstible
line. We will provide traffic reports to Bergen Brunswig with respect to
burstible capacity.
---------------------------------------------------------------------------------------------------------------------
OBJECTIVE 1 COMMENTS
---------------------------------------------------------------------------------------------------------------------
Year 2000 compliant. We have recently completed a review of all third party development
tools and have certified that all tools are Y2K compliant
---------------------------------------------------------------------------------------------------------------------
Provision for non-technical, complete, and This documentation will be developed specifically for Bergen
easy-to-read user documentation. (Welcome Brunswig. Production costs will be an additional cost.
Package)
---------------------------------------------------------------------------------------------------------------------
Provision for on-line user documentation. Standard feature of our underlying technology platform
---------------------------------------------------------------------------------------------------------------------
Ability to limit a store's participation and OPTION 1: Pharmacist will have no direct access to the system.
functions based on the option for which they Changes will be made by Bergen Brunswig and submitted to Netgateway
have opted. OPTION 2: Pharmacists will be able to change taglines, update
images, and choose from 3 or more program spots
OPTION 3: Pharmacists will have all functionality defined in Option
2, access National Coupons, add additional content pages, and
link to the prescription system
Core store information is only changeable by Bergen Brunswig.
Change requests will go to Netgateway daily.
---------------------------------------------------------------------------------------------------------------------
Ability to format new pharmacy web sites with Will be available via links and forms
text and graphics from a secure site.
---------------------------------------------------------------------------------------------------------------------
Dynamic update ability for National Specials All option 3 stores will be propagated with National Specials
including coupons and product images.
---------------------------------------------------------------------------------------------------------------------
Dynamic update ability for store specials Fully supported
including coupons and product images.
---------------------------------------------------------------------------------------------------------------------
<PAGE>
Schedule 1 - Statement of work and project specification page 3
---------------------------------------------------------------------------------------------------------------------
Ability to produce standard reports on web Each option 2 and 3 store will be able to retrieve site statistic
site activity. including page views for each individual page
General admin system will report at the aggregate level all
activity, billing information and change activity (including
monies paid to Netgateway directly)
---------------------------------------------------------------------------------------------------------------------
Password security at store, and GO levels. Implement division #, account #, and NABP # and password
---------------------------------------------------------------------------------------------------------------------
Provide links to other sites (health content, Part of the template system
E-commerce, etc.) based on store specific Online advertising management system will be covered in a separate
options. proposal
---------------------------------------------------------------------------------------------------------------------
Provide capability for consumers to send Via fill out forms that can be faxed or emailed to pharmacies
Email to the stores, based on store specific
options.
---------------------------------------------------------------------------------------------------------------------
Dynamic update ability for free form pages Yes we can do the work in house at $75/hour.
including text and graphics, based on store We will work with Bergen to develop alternative costing packages
specific options.
All work will be billed directly to the pharmacy. This billing
will be reported to Bergen monthly.
---------------------------------------------------------------------------------------------------------------------
Provide maintenance for the entire site on a Schedule and costing will be determined by Netgateway and Bergen
minimum schedule of twice per year to keep Brunswig
the site looking fresh and the navigation
current.
---------------------------------------------------------------------------------------------------------------------
Ability to link to the store locator function Fully supported
using the store addresses provided and
maintained by Bergen Brunswig.
---------------------------------------------------------------------------------------------------------------------
Link store specific URL's to the store's home Fully supported page
on request.
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
OBJECTIVE 2 COMMENTS
---------------------------------------------------------------------------------------------------------------------
Provide administrative support to GNP Fully operational design staff in house. Initial setup is part of
pharmacies for initial development of web "set-up fees." Additional support will be charged at $75/hour and
pages. billed to the pharmacy directly
---------------------------------------------------------------------------------------------------------------------
Provide ongoing support to GNP pharmacies for Fully supported
maintenance of existing web pages.
---------------------------------------------------------------------------------------------------------------------
Ability to accept requests via Email, phone, Fully supported
fax or letter.
---------------------------------------------------------------------------------------------------------------------
Ability to turn around maintenance requests Netgateway has a dedicated department to building stores.
within 48 hours. Reasonable SLA will be determined at a later date.
---------------------------------------------------------------------------------------------------------------------
<PAGE>
Schedule 1 - Statement of work and project specification page 4
---------------------------------------------------------------------------------------------------------------------
Provide confirmation of update to GNP store Processes, procedures and service level agreements will be
with a copy to GNP department in Orange. established
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
OBJECTIVE 3 COMMENTS
---------------------------------------------------------------------------------------------------------------------
Provide 24 by 7 availability for the GNP web Owners will be able to make changes or updates at anytime
site.
---------------------------------------------------------------------------------------------------------------------
Provide 24 by 7 help line support for Bergen Optional private branding can also be provided by our wholly owned
Brunswig technical departments. (First line centers. Pricing will be determined based on specific requirements.
customer support will be provided by the
Bergen Brunswig Help Desk.)
---------------------------------------------------------------------------------------------------------------------
PROJECT FEES:
Per our original response to your RFP, we agree to a fixed bid development cost
of $205,000. This price includes hosting the application, building all site
functionality contained within the RFP, developing the administration
components, and setting up a support account with our call center. Direct
project expenses will be billed at cost.
ADDITIONAL COSTS ARE PROVIDED IN THE TABLE BELOW:
---------------------------------------------------------------------------------------------------------------------
Cost Component One Time Cost Recurring cost
---------------------------------------------------------------------------------------------------------------------
Option 2 Pharmacy Setup $180 $15.95/Month
---------------------------------------------------------------------------------------------------------------------
Option 3 Pharmacy Setup $230 $34.95/Month
---------------------------------------------------------------------------------------------------------------------
Netgateway supported content changes $75/hr
---------------------------------------------------------------------------------------------------------------------
Personalized domain name $120/store*
registration
---------------------------------------------------------------------------------------------------------------------
Training in addition to 3 days $500/day
provided
---------------------------------------------------------------------------------------------------------------------
Private call center branding TBD TBD
---------------------------------------------------------------------------------------------------------------------
Outsourced system administration TBD TBD
---------------------------------------------------------------------------------------------------------------------
* this price includes a 2-year Internic Registration Fee
As agreed in our meeting on October 5th, 1999, payment terms regarding all
development fees will be as follows:
1. DEVELOPMENT FEES*:
---------------------------------------------------------------------------------------------------------------------
% of work Complete Corresponding $ Remitted $ Milestone Target Date
amount
---------------------------------------------------------------------------------------------------------------------
<PAGE>
Schedule 1 - Statement of work and project specification page 5
---------------------------------------------------------------------------------------------------------------------
15% $30,750 $15,375 Signoff - Functional November 15, 1999
Design
---------------------------------------------------------------------------------------------------------------------
30% $61,500 $30,750 Signoff - System Design November 26, 1999
---------------------------------------------------------------------------------------------------------------------
40% $82,000 $41,000 User Acceptance Test December 13, 1999
---------------------------------------------------------------------------------------------------------------------
15% $30,750 $15,375 + Pharmacies Loaded December 17, 1999
---------------------------------------------------------------------------------------------------------------------
$102,500 Post Implementation December 31, 1999
Review
---------------------------------------------------------------------------------------------------------------------
Total $102,500 $205,000
------------------------------------------------------------
* if additional scope is added, it will be billed on a separate payment schedule
2. STORE SETUP AND MONTHLY FEES:
Will be billed monthly for completed work.
3. DIRECT EXPENSES
Normal project expenses (e.g. travel, copying fees, etc) will be billed at cost
and receipts will be provided upon request.
Pharmacy changes will be billed directly to the requesting pharmacy. Monthly
billing activity reports will be provided to Bergen Brunswig.