Original Equipment Manufacturer Agreement - CyberGuard Corp. and Information Resource Engineering Inc.
ORIGINAL EQUIPMENT MANUFACTURER AGREEMENT
This Original Equipment Manufacturer Agreement ("Agreement") is made and entered
into as of this 11th day of June, 1998, by and between CyberGuard Corporation, a
Florida corporation, whose registered office address is 2000 W. Commercial
Blvd., Ft. Lauderdale, Florida 33309 ("CYBG"), and Information Resource
Engineering, Inc., a Delaware corporation, whose registered office address is
8029 Corporate Drive, Baltimore, MD 21236 ("OEM").
WHEREAS OEM desires to obtain from CYBG, and CYBG desires to grant OEM, the
right to license the Licensed Software in territory listed in Exhibit E, on the
terms and conditions set out below.
OEM and CYBG agree as follows:
1. DEFINITIONS
1.1. "Code" means computer programming object code, which is substantially
or entirely in binary form, which is directly executable by a computer
without the intervening steps of compilation or assembly.
1.2. "Customer" means resellers, dealers, and end users.
1.3. "Licensed Software" means commercially available for distribution
Firewall software products and related user's manuals.
1.4. "Specification" means a description of any and all modifications to
the Licensed Software.
1.5. "Upgrade" means maintenance modifications and enhancements that
substantially modify the Licensed Software.
2. RESPONSIBILITIES OF OEM
2.1. OEM agrees to pay for the Licensed Software at the prices set forth in
Exhibit C.
2.2. OEM agrees to aggressively promote the sales of the Licensed Software
to Customers through promotional activities, advertisement, and sales
calls.
2.3. OEM agrees to participate in CYBG training programs for sales and
support.
2.4. OEM agrees to provide all support to Customers as defined in Exhibit
A.
2.5. OEM agrees to provide any and all warranty support to the OEM's
Customers.
2.6. OEM shall provide CYBG with a report of sales ("Sales Report") within
fifteen (15) days of the end of each month, which includes: dollar
amount, volume, geographic area, and any other pertinent information
that CYBG may request and is mutually agreed to by the parties hereto.
2.7. OEM shall comply with the terms and conditions of OEM's SafeNet
Partner Program, attached hereto and incorporated herein as Exhibit H
which may be amended from time to time by OEM, including without
limitation, the Discount Structure and Commitment Levels section.
3. RIGHTS TO MANUFACTURE
3.1 CYBG shall grant OEM the right to private brand Licensed Software.
Private branding allows the OEM to add product names and logo to
Licensed Software, subject to Section 5.4 herein.
3.2 OEM shall submit any private branding modifications to the Licensed
Software to CYBG as a Specification.
3.3 CYBG shall commence private branding modifications upon written
acceptance by OEM
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3.4 OEM shall pay to CYBG the Right to Manufacture Fee of $250,000.00,
subject to Section 7 herein. The payment for the initial equivalent
amount of Licensed Software is waived by CYBG on a dollar-for-dollar
basis. Shipments under both this Agreement and the Distribution
Agreement executed by the parties hereto will be applied toward the
Right to Manufacture Fee.
3.5 OEM shall distribute Licensed Software under the terms of this
Agreement herein immediately when CYBG completes tasks listed in
Exhibit G "Acceptance Criteria".
4. RESPONSIBILITIES OF CYBG
4.1. CYBG shall provide a reproducible binary version of the Licensed
Software for distribution.
4.2. CYBG shall provide OEM with the CYBG Software License Agreement as
seen in Exhibit B.
4.3. CYBG approves the right of the OEM to use the designation "Authorized
CyberGuard Original Equipment Manufacturer" during the term of this
Agreement.
4.4. CYBG shall provide training for technical and marketing support for a
fee.
4.5. CYBG shall complete the tasks listed in the Exhibit G herein no later
than December 31, 1998.
5. PUBLIC RELATIONS
5.1. The parties will work toward a common external message and timing of
public announcements.
5.2. OEM shall submit to CYBG for approval any and all advertising and
sales literature of OEM which refers to CYBG and/or includes the CYBG
mark. Such approval shall not be unreasonably withheld or delayed.
5.3. CYBG does not grant OEM any right to use and/or duplicate the CYBG
mark or certifications and evaluations. CYBG reserves the right to
change the CYBG mark.
5.4. OEM agrees not to delete or alter in any manner CYBG's copyright
notices on the Licensed Software or Upgrades.
6. OWNERSHIP AND LICENSES
6.1. Intellectual Property
6.1.1.CYBG retains sole and exclusive ownership of all worldwide
copyrights, patents, trademarks, trade secrets, know-how, and any
other intellectual property right in and to the Licensed Software
and Upgrades as they exist now or in the future.
6.1.2.OEM acknowledges that CYBG owns all right, title, and interest in
the CYBG name and logotype and mark and is the owner of certain
other CYBG registered or common law trademarks and tradenames.
OEM acknowledges that OEM will not use or acquire any interest in
any of these trademarks or trade names by virtue of this
Agreement, or the activities of either of us under it.
6.1.3.CYBG acknowledges that OEM owns all right, title, and interest in
the OEM name and logotype. CYBG acknowledges that it will not
acquire any interest in the OEM name or mark by virtue of this
Agreement or the activities of either of us under it.
7. CYBG GRANTS TO OEM
7.1. CYBG grants to OEM, and its subsidiaries, a territory-wide,
nonexclusive license with no right to sublicense under copyrights,
know-how and trade secrets to manufacture and sell copies of Licensed
Software in Code only to Customers.
7.2. CYBG grants to OEM, and its subsidiaries, a territory-wide,
nonexclusive license under copyrights, know-how, and trade secrets to
internally use, display, and execute in Code only five (5) copies of
the Licensed Software solely for demo purposes at no charge.
7.3. The licensing terms included in each agreement between OEM and
Customer shall be from CYBG or shall be legally sufficient to:
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7.3.1 Effectuate a license with restrictions specified herein, not a
transfer of ownership, to the Customer, and preserve all
copyright and other intellectual property right notices of
CYBG;
7.3.2. Prohibit reverse assembly, reverse compilation, or other
translation of the Licensed Software.
7.4. OEM shall distribute OEM product under a written agreement between
OEM and each Customer which shall contain the substantive terms and
conditions of the CyberGuard(TM) Software License Agreement as
providED in Exhibit B or as amended by CYBG from time to time.
7.5. OEM agrees not to reproduce, copy, modify, translate, disassemble,
reverse engineer or otherwise attempt, or permit others to attempt,
to discover the source code of the License Software and/or Upgrades.
8. FEES AND PAYMENTS
8.1 OEM shall purchase the Licensed Software and Upgrades for
distribution under this Agreement directly from CYBG.
8.2 OEM shall send all payments, referencing this Agreement to:
CyberGuard Corporation, 2000 West Commercial Blvd., Suite 200, Fort
Lauderdale, FL 33309-1892.
8.3 During the term of this Agreement and for one (1) year thereafter
CYBG shall have the right, at its expense and upon not less than
twenty (20) working days notice to OEM and no more than once per
year, to have an examination and audit conducted of OEM records
specifically relating to payments hereunder to determine compliance
with this section. Any such audit must be conducted during regular
business hours and in such a manner as not to interfere unreasonably
with OEM's normal business activities. Such audit will be conducted
by a member of the AICPA who has agreed to be bound by substantially
similar terms and conditions as those set out in the attached
Non-Disclosure Agreement in Exhibit F.
8.4 The fees payable by OEM hereunder are exclusive of taxes. OEM shall
pay or reimburse CYBG for all taxes, including sales or use taxes,
however designated, imposed as a result of the existence or operation
of this Agreement, except income and franchise tax imposed on CYBG by
any government entity. If applicable, OEM may, in lieu of paying
sales and/or use taxes, furnish to CYBG a tax exemption certificate
which is acceptable to the appropriate taxing authority.
8.5 Payment shall be made within thirty (30) days from the date of each
sale, as listed in the monthly Sales Report, without reduction or
offset for returns. All amounts over due shall bear interest at the
rate of 1.5% per month or, if lower, the highest rate permitted by
applicable law.
8.6 CYBG may change prices with (30) thirty days notification. Price
changes will not affect purchase orders that are in process and
accepted. OEM may place additional orders at the then current prices
during such notification period. Price changes will be consistent
with CYBG's price changes for other OEMs with similar sales volume
commitments.
8.7 OEM is granted purchase discounts off of list prices as set forth in
Exhibit C.
9. WARRANTY DISCLAIMER
9.1. Warranty Disclaimer
9.1.1 CYBG provides the Licensed Software and any Upgrades with no
warranties as specifically stated in the CyberGuard(TM)
Software License Agreement, attached hereto or as amended by
CYBG from time TO time.
10. TERM AND TERMINATION
10.1. This Agreement shall be effective as of the date first written above
herein ("Effective Date") and shall continue for five (5) years at
the rates and discounts provided herein subject to
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attainment of the annual unit volume commitments as specified in
Exhibit E. In the event OEM does not meet the annual unit volume
commitments, CYBG has the right to modify the terms and conditions of
this Agreement, including without limitation, the discount schedule
set forth herein in Exhibit C, on each anniversary date of the
Effective Date ("modifications"). The modifications will be
consistent with "Most Favored Nations" for comparable discounts, and
terms and conditions. CYBG will not modify the discount schedule
while license fees are being waived on the initial $250,000 Right to
Manufacture fee, as such waiver is more fully described in section
3.4 of this Agreement. In the event that parties agree to CYBG's
modifications in writing, this Agreement renews on the applicable
anniversary date of the Effective Date at the modified terms and
conditions. In the event that parties do not agree to CYBG's
modifications and state so in writing, this Agreement will terminate
in 90 days from the date of such writing, and neither party hereto
will have thereafter any recourse arising from such termination
except as otherwise stated in this Agreement.
10.2. Either party shall have the right to terminate this Agreement for
material breach by the other party hereto. Termination shall become
effective ninety (90) days after written notice is given by the
terminating party to the breaching party. Such notice shall
specifically identify the nature of the breach and state an intent to
terminate in the event the breach is not cured within said ninety
(90) days period. Written notice shall be signed by an authorized
representative of CYBG and shall be sent in accordance with
Subsection 15.13, "Notices."
10.3. Upon termination or expiration of this Agreement, the OEM will return
all confidential information given to it by CYBG.
10.4. Survival After Termination or Expiration:
The provisions of Section 6 "Ownership and Licenses," Section 8 "Fees
and Payments," Section 9 "Warranty and Indemnification," Section 10
"Term and Termination," Section 11 "Limitation of Liability," Section
12 "Compliance with Laws," Section 13 "Confidential Information,"
Section 14 "Force Majeure," Section 15 "General," shall survive and
continue beyond any expiration or termination of this Agreement,
except that licenses granted to OEM by CYBG shall not survive if this
Agreement is terminated for a material breach by OEM. End user
licenses are not affected.
11. LIMITATION OF LIABILITY
11.1. In no event will either party be liable to the other for any
incidental or special damages, actual losses, lost profits, lost
savings, or any other consequential damages regardless of the form of
action, even if such party has been advised of the possibility of
such damages, resulting from the subject matter of this Agreement.
12. COMPLIANCE WITH LAWS
12.1 Each party will comply with all applicable laws and regulations and
ordinances including, but not limited to, the regulations of the U.S.
Government relating to the export of commodities and technical data
insofar as they relate to the activities under this Agreement. Each
party hereby gives its written assurance that neither products nor
any technical data provided by the other party under this Agreement,
is intended to be shipped, directly or indirectly, to the prohibited
countries identified by the U.S. Government.
12.2 The Department of Commerce Bureau of Export Administration ("BXA")
has taken the position that software containing Application
Programming Interfaces
12.3 ("APIs") similar to CYBG's CENTRAL/REMOTE FIREWALL MANAGEMENT FEATURE
or are controlled by United States export laws, and therefore, such
source code and object code software cannot be exported without a
valid license or other authorization from the U.S. government. CYBG
hereby
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places OEM on notice that any item controlled under the U.S. laws and
regulations, including without limitation, the CENTRAL/REMOTE
FIREWALL MANAGEMENT FEATURE or any other encryption feature, or any
product containing the CENTRAL/REMOTE FIREWALL MANAGEMENT FEATURE or
any other encryption feature, cannot be exported (as defined in
section 734.2 (b) (9) of the Export Administration Regulations (15
CFR ss.734.2(b)(9)) without a valid license or other authorization
from the U.S. government.
12.4. OEM shall notify CYBG of any contract for sale of the CENTRAL/REMOTE
FIREWALL MANAGEMENT FEATURE and/or any other encryption feature or
any product containing the CENTRAL/REMOTE FIREWALL MANAGEMENT Feature
or any other encryption feature that is deemed an export under BXA
regulations; any application submitted to the U.S. government to
obtain an export license under BXA regulations or any other export
control laws or regulations; and any actual export under such license
obtained from the U.S. government for export.
12.5. OEM assumes all risk and cost associated with a violation of any U.S.
export control law or regulation, and will indemnify CYBG for the
full consequences of any export of the CENTRAL/REMOTE FIREWALL
MANAGEMENT FEATURE or any other encryption feature without CYBG's
knowledge.
12.6. Termination or cancellation of this Agreement or any Exhibits or
attachments hereto shall have no effect on the rights and obligations
of the parties under this section.
13. CONFIDENTIAL INFORMATION
13.1. All Confidential information exchanged by the parties shall be in
accordance with a Mutual Non-Disclosure Agreement attached hereto as
Exhibit F and incorporated herein by reference.
14. FORCE MAJEURE
14.1. Neither party to this Agreement shall be liable for its failure to
perform any of its obligations hereunder during any period in which
such performance is delayed by circumstances beyond its reasonable
control, including but not limited to: fire, act of nature, or,
embargo, riot or the intervention of any government authority,
provided that the party suffering such delay promptly notifies the
other party of the delay.
15. GENERAL
15.1 Neither party shall assign this Agreement nor any interest therein
without the prior written consent of the other party, except that
both parties may assign this Agreement or any interest therein in
connection with a merger, acquisition, sale of substantially all of
assets, or similar business combination; provided, however, that OEM
may not assign this Agreement or any interest therein to a third
party which is a competitor of CYBG or becomes a competitor of CYBG
as a result of this Agreement.
15.2. Except as otherwise expressly provided herein, the rights and
remedies of the parties provided in this Agreement shall not be
exclusive and are in addition to any other rights and remedies
provided at law or in equity.
15.3. Each party, including its servants, agents, and employees, is deemed
to be an independent contractor and not an agent, joint venturer,
employee, or representative of the other, and neither party may
create any obligations or responsibilities on behalf of or in the
name of the other party.
15.4. If any provision of this Agreement is held illegal or unenforceable
by any court of competent jurisdiction, such provision shall be
modified to the minimal extent required to make it legal and
enforceable, consistent with the spirit and intent of this Agreement.
If such provision cannot be so modified, the provision shall be
deemed separable from the remaining provisions
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of this Agreement and shall not affect or impair the validity or
enforceability of the remaining provisions of this Agreement.
15.5. This Agreement shall be governed by the laws of the State of Florida
applicable to agreements made and performed entirely within such
jurisdiction except that the conflict of laws provisions of the
State of Florida relating to determination of the applicable forum
law to be used shall not apply.
15.6. Supplemental terms are included in Exhibits A through H and are
incorporated herein by reference. In case of conflict between the
terms of Exhibits A through H and the body of this Agreement, the
body of this Agreement shall govern.
15.7 No rights or licenses are granted hereunder, expressly or by
implication or estoppel, to assign or grant any rights or licenses
to any trademarks of either party, or to any inventions of either
party, except as may be expressly provided herein.
15.8. The failure of either party to enforce, in any one or more
instances, any of the terms or conditions of the Agreement shall not
be construed as a waiver of the future performance of any such term
or condition.
15.9. Nothing contained in this Agreement shall prevent either party from
entering into agreements with third parties which are similar to
this Agreement, or from independently developing (either through
third parties or through the use of its own personnel), or from
acquiring from third parties, technologies or product or services
which are similar to and competitive with that of the other party.
15.10. Neither party shall disclose the existence or terms and conditions
of the Agreement to third parties except with prior written
agreement of the other party or in response to order of a court or
government agency or the disclosure rules and regulations of the
Securities and Exchange Commission, but in each such case only to
the extent so required.
15.11. Except for actions to recover payments under this Agreement, no
actions, regardless of form, arising out of this Agreement, may be
brought by either party more than two (2) years after the cause of
action has arisen.
15.12. This Agreement, together with its Exhibits; and the agreements
listed in Exhibit E of this Agreement, express the entire agreement
and understanding of the parties with respect to the subject matter
hereof and supersedes all prior oral or written agreements,
negotiations, commitments, and understandings pertaining to the
subject matter hereof. Any modifications of or changes to this
Agreement shall be in writing and signed by both parties.
15.13. Notices
15.13.1. Notices under this Agreement shall be addressed to:
To CYBG: CyberGuard Corporation
2000 West Commercial Blvd., Suite 200
Ft. Lauderdale, FL 33309
ATTN: Business Development
To OEM: Information Resource Engineering, Inc.
8029 Corporate Drive
Baltimore, MD 21236
ATTN: OEM Manager
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the date first written above.
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CYBERGUARD CORPORATION INFORMATION RESOURCE ENGINEERING, INC.
By: By:
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Signature Signature
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Print or type name Print or type name
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Title Title
EXHIBIT A
Support Agreement
1. Definitions
1.1. Level 1 shall mean the service provided in response to the initial
phone call placed by a Customer which identifies or documents an
error.
1.2. Level 2 shall mean the service provided to analyze or reproduce the
error or to determine that the error is not reproducible.
1.3. Level 3 shall mean the service provided that isolates the error to the
component level. An attempt shall be made to provide an error
correction or circumvention.
1.4. Error shall mean any of the following:
1.4.1. Code Error
1.4.1.1. A function described in the Licensed Software which is
omitted from the code;
1.4.1.2. A function which does not operate or gives incorrect
results; or
1.4.1.3. A function which does not operate satisfactorily in the
environment for which it was designed.
1.4.2. Documentation Error
1.4.2.1. A failure of the documentation to accurately describe
the functionality as described in the Licensed Software;
or
1.4.2.2. A failure of the documentation to enable the intended
user to correctly operate the code.
1.5. Error Severity Level shall mean classification of errors according to
the following definitions:
1.5.1. High Priority shall mean an emergency condition which causes
critical impact or which makes the performance or continued
performance of any one or more functions impossible.
1.5.2. Medium Priority shall mean a condition which significantly
affects or which makes the performance or continued performance
of any one or more functions difficult and which can be
circumvented or avoided on a temporary basis.
1.5.3. Low Priority shall mean a documentation error or a limited
problem condition which is not critical and which may be
circumvented or avoided on a temporary basis.
2. Support shall be provided based on reasonable commercial practices that may
change from time to time.
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EXHIBIT B
CyberGuard Software License Agreement
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EXHIBIT C
OEM Price Matrix
(Note: Model Numbers Refer to CyberGuard Distributor Price Book Parts)
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EXHIBIT E
Territory, Agreements and Volume Commitments
D1 Territory
Territory means world-wide, except prohibited countries
identified by the United States government.
D2 Agreements
The business relationship between Information Resource Engineering,
Inc. and CyberGuard Corporation is represented in this OEM Agreement
and a separate Distribution Agreement, dated June 11, 1998. These
agreements and their exhibits express the entire agreement and
understanding of the parties and supersede all prior oral or written
agreements, negotiations, commitments, and understandings pertaining
to the subject matter hereof. Any modifications of or changes to this
Agreement shall be in writing and signed by both parties.
D3 Annual Volume Commitments
First Year 500 units
Second Year 2,000 units
Third Year 5,000 units
Fourth Year 12,500 units
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EXHIBIT F
Mutual Non-Disclosure Agreement
THIS AGREEMENT is made and entered into by and between CyberGuard Corporation, a
Florida corporation, having a principal place of business at 2000 W. Commercial
Blvd., Suite 200, Fort Lauderdale, Florida, 33309 (hereinafter referred to as
"CyberGuard"), and Information Resource Engineering, Inc., a Delaware
corporation, having a principal place of business at 8029 Corporate Drive,
Baltimore, MD 21236 (hereinafter referred to as "Company").
WHEREAS, CyberGuard and Company are desirous of exchanging information for the
purpose of exploring the possibility of the two companies working together, to
the mutual benefit of both parties hereto.
AND WHEREAS, if the parties determine to work together, the exchange of
information will continue throughout the parties' working relationship.
AND WHEREAS, one party hereto (OWNER) may disclose to the other party hereto
(RECIPIENT), certain information pursuant to this Agreement which the OWNER
deems proprietary and confidential.
NOW, THEREFORE, the parties hereto agree as follows:
1. For a period of three (3) years from the date of receipt of any
"Confidential Information" (as defined below), each RECIPIENT shall use
reasonable efforts to prevent the disclosure to any other person, firm or
corporation of any Confidential Information which it receives from OWNER.
RECIPIENT shall also use the same degree of care to avoid disclosure of
such information as RECIPIENT employs with respect to its own proprietary
and confidential information of like importance and shall limit disclosure
of the Confidential Information to those of its personnel and personnel of
its affiliated companies and its outside professional firms who have an
actual need to know and have an obligation to protect the confidentiality
of such Information consistent with the requirements of this Agreement.
RECIPIENT also agrees not to use the Confidential Information for any
purpose other than the purpose described in the recitals to this Agreement.
2. Any reports or other documents resulting from such exchange of information
between the parties shall be governed by the same terms and conditions with
respect to confidentiality as is the exchange of Confidential Information
between the parties.
3. Notwithstanding the foregoing, information shall not be deemed Confidential
Information and RECIPIENT shall have no obligation with respect to any such
information which
a. is already known to RECIPIENT, and such prior knowledge can be
demonstrated through physical evidence that pre-dates this
Agreement, or
b. is or becomes publicly known through publication or otherwise and
through no wrongful act of RECIPIENT, or
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c. is received from a third party without similar restriction and
without breach of this Agreement, or
d. is independently developed by RECIPIENT, or
e. is furnished to a third party by OWNER without a similar
restriction on the third party's rights, or
f. is approved for release by written authorization of OWNER (so long
as such release complies with any requirements of the
authorization), or
g. is disclosed pursuant to the lawfully imposed requirement of a
governmental agency or disclosure is required by operation of law.
4. Each of the Parties hereto acknowledge that irreparable harm, for which
there would be no adequate remedy at law, would arise from a violation of
this Agreement. Therefore, each Party acknowledges that a breach of this
Agreement would give rise to a right to an injunction in favor of the
non-breaching party. Notwithstanding the foregoing, the parties are
entitled to pursue any appropriate remedies at law or in equity for breach
of this Agreement. This Agreement constitutes the entire agreement of the
parties hereto with respect to confidentiality of business information and
supersedes any prior agreements or understandings of the parties hereto
regarding such information. This Agreement shall be construed in accordance
with the laws of the State of Florida. This Agreement may be amended or
modified only in a writing signed by both parties.
5. All Confidential Information that is in any reproducible form (including
without limitation, written or electronic form) delivered by one party
hereto to the other party shall be and remain the property of the
delivering party, and all such data, and any copies thereof, shall be
promptly returned to the delivering party upon written request, or
destroyed at the delivering party's option.
6. This Agreement shall not be construed as granting or conferring any rights
by license or otherwise, expressly, impliedly, or otherwise for any
invention, discovery or improvement made, conceived or acquired prior to or
after the date of this Agreement.
7. Nothing contained in this Agreement shall constitute a commitment by either
party to the development or release of any future products and/or programs
disclosed thereby or restrict either party in its efforts to improve its
existing products and systems and to conceive and develop new products and
systems. Additionally, participation in the information exchange pursuant
to this Agreement shall not constitute or imply a commitment by either
party to favor or recommend any product or service of the other party.
8. For the purposes of this Agreement, "Confidential Information" shall mean
any information that is disclosed to RECIPIENT by the OWNER that has been
created, developed, discovered, discerned, acquired, licensed or purchased
by the OWNER, including without limitation, information relating to any
product, process, development, research work, business line, business
strategy or intellectual property of any kind, and shall include, without
limitation, inventions, improvements, discoveries, creations, computer
programs, computer hardware, design specifications, concepts, formulas,
trade secrets, ideas, processes, know-how, methods, proprietary data,
software code, source code, products,
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future products, techniques, any and all derivative works therefrom and any
and all patents and copyrights therein or any improvements thereof.
IN WITNESS WHEREOF, the parties hereto agree that the effective date of this
Agreement shall be the 11th day of June, 1998.
CyberGuard Corporation Information Resource Engineering, Inc.
By: By:
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Signature Signature
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Print or type name Print or type name
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Title Title
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EXHIBIT G
OEM Acceptance Criteria
Both companies want IRE to operate as an OEM with an IRE branded version of
CyberGuard's firewalls.
1. CyberGuard will provide support to IRE consistent with CYBG's commercial
practices as listed in (a) Escalation and call handling Statement, (b)
hardware certification procedure, (c) hardware certification presentation,
(d) installation guide, (e) Business Partner Program(TM) Guide, (f)
CyberGuard partner web sitE, which may be amended from time to time.
2. CyberGuard will apply engineering effort to change the logo and name,
provided that IRE supplies CyberGuard with name and logo data in the proper
format. CyberGuard will be provide documentation as machine readable source
to allow IRE to do IRE's own customization. Machine readable source remains
the property of CyberGuard.
3. CyberGuard will negotiate with its 3rd party suppliers in good faith or
supply a list of points of contacts for IRE to negotiate terms and
conditions.
4. CyberGuard will supply available documentation of the software publishing
process; the software support process; list of all supported hardware
configurations and a process for updating the list; the RIQ process; and
the product delivery dates for planning purposes.
5. CyberGuard will provide custom programming support at CyberGuard's retail
rates. Special support requirements (eg. TR turnaround times) will be
provided at CyberGuard's custom programming retail rates or will be
negotiated on a task basis.
6. CyberGuard will conduct Year 2000 compliance tests on Licensed Software and
will make available documentation of such Year 2000 tests. At the time of
this Agreement, the Year 2000 compliance tests used are derived from
Citicorp's compliance requirements. CyberGuard reserves the right to amend
the Year 2000 compliance testing criteria from time to time.
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DISTRIBUTION AGREEMENT
This Distribution Agreement ("Agreement") is made and entered into as of this
11th day of June, 1998, between CyberGuard Corporation, a Florida corporation,
whose registered office address is 2000 W. Commercial Blvd., Ft. Lauderdale,
Florida 33309 ("CYBG"), and Information Resource Engineering, Inc., a Delaware
corporation, whose registered office address is 8029 Corporate Drive, Baltimore,
MD 21236 ("Distributor").
WHEREAS Distributor desires to obtain from CYBG, and CYBG desires to grant
Distributor, the right to resell the Licensed Software in territory listed in
Exhibit G, on the terms and conditions set out below.
Distributor and CYBG agree as follows:
1. DEFINITIONS
1.1. "Code" means computer programming object code, which is substantially
or entirely in binary form, which is directly executable by a computer
without the intervening steps of compilation or assembly.
1.2. "Customer" means resellers, dealers, and end users.
1.3. "CyberGuard Authorized Master Distributor" means a CYBG's distributor
with unique terms and conditions unilaterally determined by
CyberGuard.
1.4. "Licensed Software" means commercially available for distribution
Firewall software products and related user's manuals.
1.5. "RMA" means return materials authorization number assigned by CYBG.
1.6. "Upgrade" means maintenance modifications and enhancements that
substantially modify the Licensed Software.
2. RESPONSIBILITIES OF DISTRIBUTOR
2.1. Distributor agrees to pay for the Licensed Software and the Upgrades
at the prices set forth on the CYBG published price book as set forth
in Exhibit C of this Agreement.
2.2. Distributor agrees to aggressively promote the sales of the Licensed
Software to Customers through promotional activities, advertisement,
and sales calls.
2.3. Distributor may rotate stock of the Licensed Software four times per
year at one hundred percent (100%) of the price of the Licensed
Software paid by Distributor to CYBG and exclusive of all shipping,
insurance, tariff, and other similar charges associated with
Distributor's purchase and rotation of the License Software.
2.4. Distributor agrees to participate in CYBG training programs for sales
and support in accordance with the terms and conditions of the CYBG's
Program Guide, attached hereto and incorporated herein as Exhibit I,
that CYBG may amend from time to time.
2.5. Distributor agrees to provide the level 1 and level 2 support to
Customers as defined in Exhibit A.
2.6. Distributor agrees to provide ninety (90) day warranty support to the
Distributor's Customers. The warranty period begins with the
installation of the Licensed Software.
2.7. Distributor shall provide CYBG with a report of sales within fifteen
(15) days of the end of each month, which shall include: dollar
amount, volume, geographic area, and any other pertinent information
that CYBG may request and is mutually agreed to by the parties hereto.
<PAGE> 16
2.8. Distributor shall issue to CYBG purchase orders identifying the title
and quantity of the Licensed Software and include such billing,
shipping, pricing, and other information as requested by CYBG.
2.9. Distributor shall pay all charges for shipping and transportation of
the Licensed Software.
2.10. Distributor shall provide the initial order volumes equal to
$250,000.00 upon signing the Agreement. This initial order is waived
upon the condition that Distributor executes the CyberGuard
Corporation Original Equipment Manufacturer Agreement prior to or
simultaneously with the execution of this Agreement.
2.11. Distributor must notify CYBG within twenty (20) days after accepting
delivery of visibly incomplete or damaged goods. All goods will be
shipped EXW, 2000 West Commercial Blvd., Suite 200, Fort Lauderdale,
FL 33309.
2.12. Licensed Software shall be returned by Distributor to CYBG unopened,
in original packaging, within sixty (60) days of CYBG notification of
an Upgrade availability.
2.13. Distributor has thirty (30) days to provide CYBG with the number of
unused/unopened copies Distributor wishes to return as a result of
CYBG notification of Upgrade.
2.14. Distributor shall comply with the terms and conditions of
Distributor's SafeNet Partner Program, attached hereto and
incorporated herein as Exhibit H which may be amended from time to
time by Distributor, including without limitation, the Discount
Structure and Commitment Levels section. The published list prices
referenced in the Discount Structure and Commitment Levels section
shall be the list prices provided by CYBG to Distributor under this
Agreement.
3. RESPONSIBILITIES OF CYBG
3.1. CYBG shall provide to Distributor copies of the Licensed Software for
distribution.
3.2. CYBG shall provide to Distributor copies of Upgrades to the Licensed
Software for distribution.
3.3. CYBG shall issue an RMA to Distributor when required for section 2.12
and 2.13.
3.4. CYBG shall provide Distributor with the CYBG Software License
Agreement as set out in Exhibit B.
3.5. CYBG approves the right of the Distributor to use the designation
"Authorized CyberGuard Software Distributor" during the term of this
Agreement.
3.6. CYBG shall provide Level 3 support to Distributor as defined in
Exhibit A.
3.7. CYBG shall provide training for technical and marketing support for a
fee as set out in the CYBG's Program Guide, attached hereto as
Exhibit I, that CYBG may amend from time to time.
3.8. CYBG shall provide warranty support as described in Exhibit A.
3.9. CYBG shall provide marketing collateral as it becomes available.
4. PUBLIC RELATIONS
4.1. The parties will work toward a common external message and timing of
public announcements.
4.2. CYBG reserves the right to require the Distributor to submit to CYBG
for approval any and all advertising and sales literature of
Distributor which refers to CYBG and/or includes the CYBG mark. Such
approval shall not be unreasonably withheld or delayed.
4.3. CYBG grants the right to Distributor to duplicate the CYBG mark as
described in Exhibit F. CYBG reserves the right to change the CYBG
mark.
4.4. Distributor agrees not to change or remove any CYBG mark on Licensed
Software or Upgrades.
5. OWNERSHIP AND LICENSES
5.1. Intellectual Property
<PAGE> 17
5.1.1. CYBG retains sole and exclusive ownership of all worldwide
copyrights, patents, trademarks, trade secrets, know-how, and
any other intellectual property right in and to the Licensed
Software and Upgrades as they exist now or in the future.
5.1.2. Distributor acknowledges that CYBG owns all right, title, and
interest in the CYBG name and logotype and mark and is the owner
of certain other CYBG registered or common law trademarks and
tradenames. Distributor acknowledges that Distributor will not
use or acquire any interest in any of these trademarks or trade
names by virtue of this Agreement, or the activities of either
of us under it.
5.1.3. CYBG acknowledges that Distributor owns all right, title, and
interest in the Distributor name and logotype. CYBG acknowledges
that it will not acquire any interest in the Distributor name or
mark by virtue of this Agreement or the activities of either of
us under it.
6. CYBG GRANTS TO DISTRIBUTOR
6.1. CYBG grants to Distributor, and its subsidiaries, a territory-wide,
nonexclusive license under copyrights, know-how and trade secrets to
sell copies of Licensed Software in Code only to Customers.
6.2. CYBG grants to Distributor, and its subsidiaries, a territory-wide,
nonexclusive license under copyrights, know-how, and trade secrets to
internally use, display, and execute in Code only one copy of the
Licensed Software solely for demo purposes at no charge.
6.3. Distributor shall not remove and shall provide to Customers the
CyberGuard(TM) Software License AgreemeNT supplied by CYBG with the
Licensed Software and/or Upgrades as set out in Exhibit B or as
amended by CYBG from time to time.
7. FEES AND PAYMENTS
7.1. Distributor shall purchase the Licensed Software for distribution
under this Agreement from a CyberGuard Authorized Master Distributor
or directly from CYBG.
7.2. CYBG agrees to set aside 2% of the Distributor's net purchases for
deposit into the Distributor's co-op promotion account per Exhibit D.
7.3. CYBG agrees to furnish Distributor limited advertising and promotional
material in connection with its activities hereunder. Such materials
shall be provided at no charge. Additional quantities shall reduce
funds described in 7.2 by an amount equal to CYBG cost of the
materials.
7.4. Distributor shall send all payments, referencing this Agreement to:
CyberGuard Corporation, 2000 West Commercial Blvd., Suite 200, Fort
Lauderdale, FL 33309-1892.
7.5. During the term of this Agreement and for one (1) year thereafter CYBG
shall have the right, at its expense and upon not less than twenty
(20) working days notice to Distributor and no more than once per
year, to have an examination and audit conducted of Distributor
records specifically relating to payments hereunder to determine
compliance with this section. Any such audit must be conducted during
regular business hours and in such a manner as not to interfere
unreasonably with Distributor's normal business activities. Such audit
will be conducted by a member of the AICPA who has agreed to be bound
by substantially similar terms and conditions as those set out in the
attached Non-Disclosure Agreement in Exhibit E. 7.6. The fees payable
by Distributor hereunder are exclusive of taxes. Distributor shall pay
or reimburse CYBG for all taxes, including sales or use taxes, however
designated, imposed as a result of the existence or operation of this
Agreement, except income and franchise tax imposed on CYBG by any
government entity. If applicable, Distributor may, in lieu of paying
sales and/or use taxes, furnish to CYBG a tax exemption certificate
which is acceptable to the appropriate taxing authority.
<PAGE> 18
7.7. Payments shall be made within thirty (30) days from the date of each
shipment without reduction or offset for returns. All amounts over due
shall bear interest at the rate of 1.5% per month or, if lower, the
highest rate permitted by applicable law.
7.8. In the event payment is not made when due, CYBG may defer shipment of
additional Licensed Software until all outstanding amounts, including
late charges, are paid.
7.9. CYBG may change prices with (30) thirty days notification. Price
changes will not affect purchase orders that are in process and
accepted.
7.10. Distributor is granted purchase discounts off of list prices as set
forth in Exhibit C.
8. WARRANTY DISCLAIMER
8.1. Warranty Disclaimer
8.2.1 CYBG provides the Licensed Software and any Upgrades with no
warranties as specifically stated in the CyberGuard(TM)
Software License Agreement, attached hereto or as amended by
CYBG from time to time.
9. TERM AND TERMINATION
9.1. This Agreement shall be effective as of the date first written above
herein ("Effective Date") and shall continue until the earlier of
December 31, 1998 or the date upon which CYBG completes the tasks
listed in the Exhibit G of the CyberGuard Corporation Original
Equipment Manufacturer Agreement.
9.2. Either party shall have the right to terminate this Agreement for
material breach by the other party hereto. Termination shall become
effective ninety (90) days after written notice is given by the
terminating party to the breaching party. Such notice shall
specifically identify the nature of the breach and state an intent to
terminate in the event the breach is not cured within said ninety (90)
days period. Written notice shall be signed by an authorized
representative of CYBG and shall be sent in accordance with Subsection
14.13, "Notices."
9.3. Upon termination or expiration of this Agreement, each party will
return all confidential information given to it by the other party.
9.4. Survival After Termination or Expiration
9.4.1. The provisions of Section 5 "Ownership and Licenses," Section 7
"Fees and Payments," Section 8 "Warranty and Indemnification,"
Section 9 "Term and Termination," Section 10 "Limitation of
Liability," Section 11 "Compliance with Laws," Section 12
"Confidential Information," Section 13 "Force Majeure," Section
14 "General," shall survive and continue beyond any expiration
or termination of this Agreement, except that licenses granted
to Distributor by CYBG shall not survive if this Agreement is
terminated for a material breach by Distributor. End user
licenses are not affected.
10. LIMITATION OF LIABILITY
10.1. In no event will either party be liable to the other for any
incidental or special damages, actual losses, lost profits, lost
savings, or any other consequential damages regardless of the form of
action, even if such party has been advised of the possibility of
such damages, resulting from the subject matter of this Agreement.
11. COMPLIANCE WITH LAWS
11.1 Each party will comply with all applicable laws and regulations and
ordinances including, but not limited to, the regulations of the U.S.
Government relating to the export of commodities and technical data
insofar as they relate to the activities under this Agreement. Each
party hereby gives its written assurance that neither products nor
any technical data provided by
<PAGE> 19
the other party under this Agreement, is intended to be shipped,
directly or indirectly, to the prohibited countries identified by the
U.S. Government.
11.2 The Department of Commerce Bureau of Export Administration ("BXA")
has taken the position that software containing Application
Programming Interfaces ("APIs") similar to CYBG's CENTRAL/REMOTE
FIREWALL MANAGEMENT FEATURE are controlled by United States export
laws, and therefore, such source code and object code software cannot
be exported without a valid license or other authorization from the
U.S. government. CYBG hereby places Distributor on notice that any
item controlled under the U.S. laws and regulations, including
without limitation, the CENTRAL/REMOTE FIREWALL MANAGEMENT FEATURE or
any other encryption feature, or any product containing the
CENTRAL/REMOTE FIREWALL MANAGEMENT FEATURE or any other encryption
feature, cannot be exported (as defined in section 734.2 (b) (9) of
the Export Administration Regulations (15 CFR ss.734.2(b)(9)) without
a valid license or other authorization from thE U.S. government.
11.3 Until Distributor obtains its own authorization from the U.S.
government to export CYBG's Licensed Software and Upgrades with the
encryption features, Distributor shall notify CYBG of any contract
for sale of the CENTRAL/REMOTE FIREWALL MANAGEMENT FEATURE, and/or
any other encryption feature or any product containing the
CENTRAL/REMOTE FIREWALL MANAGEMENT FEATURE or any other encryption
feature that is deemed an export under BXA regulations; any
application submitted to the U.S. government to obtain an export
license under BXA regulations or any other export control laws or
regulations; and any actual export under such license obtained from
the U.S. government for export.
11.4 Distributor assumes all risk and cost associated with a violation of
any U.S. export control law or regulation, and will indemnify CYBG
for the full consequences of any export of the CENTRAL/REMOTE
FIREWALL MANAGEMENT FEATURE, or any other encryption feature without
CYBG's knowledge.
11.5 Termination or cancellation of this Agreement or any Exhibits or
attachments hereto shall have no effect on the rights and obligations
of the parties under this section.
12. CONFIDENTIAL INFORMATION
12.1. All Confidential information exchanged by the parties shall be in
accordance with a Mutual Non-Disclosure Agreement attached hereto as
Exhibit E and incorporated herein by reference.
13. FORCE MAJEURE
13.1. Neither party to this Agreement shall be liable for its failure to
perform any of its obligations hereunder during any period in which
such performance is delayed by circumstances beyond its reasonable
control, including but not limited to: fire, act of nature, or,
embargo, riot or the intervention of any government authority,
provided that the party suffering such delay promptly notifies the
other party of the delay.
14. GENERAL
14.1 Neither party shall assign this Agreement nor any interest therein
without the prior written consent of the other party, except that
both parties may assign this Agreement or any interest therein in
connection with a merger, acquisition, sale of substantially all of
assets, or similar business combination; provided, however, that
Distributor may not assign this Agreement or any interest therein to
a third party which is competitor of CYBG or becomes a competitor of
CYBG as a result of this Agreement.
<PAGE> 20
14.2 Except as otherwise expressly provided herein, the rights and
remedies of the parties provided in this Agreement shall not be
exclusive and are in addition to any other rights and remedies
provided at law or in equity.
14.3. Each party, including its servants, agents, and employees, is deemed
to be an independent contractor and not an agent, joint venturer,
employee, or representative of the other, and neither party may
create any obligations or responsibilities on behalf of or in the
name of the other party.
14.4. If any provision of this Agreement is held illegal or unenforceable
by any court of competent jurisdiction, such provision shall be
modified to the minimal extent required to make it legal and
enforceable, consistent with the spirit and intent of this
Agreement. If such provision cannot be so modified, the provision
shall be deemed separable from the remaining provisions of this
Agreement and shall not affect or impair the validity or
enforceability of the remaining provisions of this Agreement.
14.5. This Agreement shall be governed by the laws of the State of Florida
applicable to agreements made and performed entirely within such
jurisdiction except that the conflict of laws provisions of the
State of Florida relating to determination of the applicable forum
law to be used shall not apply.
14.6. Supplemental terms are included in Exhibits A through I and are
incorporated herein by reference. In case of conflict between the
terms of Exhibits A through I and the body of this Agreement, the
body of this Agreement shall govern.
14.7. No rights or licenses are granted hereunder, expressly or by
implication or estoppel, to assign or grant, any rights or licenses
to any trademarks of either party, or to any inventions of either
party, except as may be expressly provided herein.
14.8. The failure of either party to enforce, in any one or more
instances, any of the terms or conditions of the Agreement shall not
be construed as a waiver of the future performance of any such term
or condition.
14.9. Nothing contained in this Agreement shall prevent either party from
entering into agreements with third parties which are similar to
this Agreement, or from independently developing (either through
third parties or through the use of its own personnel), or from
acquiring from third parties, technologies or product or services
which are similar to and competitive with that of the other party.
14.10. Neither party shall disclose the existence or terms and conditions
of the Agreement to third parties except with prior written
agreement of the other party or in response to order of a court or
government agency or the disclosure rules and regulations of the
Securities and Exchange Commission, but in each such case only to
the extent so required.
14.11. Except for actions to recover payments under this Agreement, no
actions, regardless of form, arising out of this Agreement, may be
brought by either party more than two (2) years after the cause of
action has arisen.
14.12. This Agreement, together with its Exhibits; and agreements listed in
Exhibit I express the entire agreement and understanding of the
parties with respect to the subject matter hereof and supersede all
prior oral or written agreements, negotiations, commitments, and
understandings pertaining to the subject matter hereof. Any
modifications of or changes to this Agreement shall be in writing
and signed by both parties.
14.13. Notices
14.13.1. Notices under this Agreement shall be addressed to:
To CYBG: CyberGuard Corporation
2000 West Commercial Blvd., Suite 200
<PAGE> 21
Ft. Lauderdale, FL 33309
ATTN: Product Marketing Manager
To Distributor: Information Resource Engineering, Inc.
8029 Corporate Drive
Baltimore, MD 21236
ATTN: Inside Sales Manager
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the date first written above.
CYBERGUARD CORPORATION INFORMATION RESOURCE ENGINEERING, INC.
By: By:
------------------------- ------------------------------
Signature Signature
------------------------- ------------------------------
Print or type name Print or type name
------------------------- ------------------------------
Title Title
<PAGE> 22
EXHIBIT A
Support Agreement
1. Definitions
1.1. Level 1 shall mean the service provided in response to the initial
phone call placed by a Customer which identifies or documents an
error.
1.2. Level 2 shall mean the service provided to analyze or reproduce the
error or to determine that the error is not reproducible.
1.3. Level 3 shall mean the service provided that isolates the error to the
component level. An attempt shall be made to provide an error
correction or circumvention.
1.4. Error shall mean any of the following:
1.4.1. Code Error
1.4.1.1. A function described in the Licensed Software which is
omitted from the code;
1.4.1.2. A function which does not operate or gives incorrect
results; or
1.4.1.3. A function which does not operate satisfactorily in the
environment for which it was designed.
1.4.2. Documentation Error
1.4.2.1. A failure of the documentation to accurately describe the
functionality as described in the Licensed Software; or
1.4.2.2. A failure of the documentation to enable the intended
user to correctly operate the code.
1.5. Error Severity Level shall mean classification of errors as assigned
by CYBG according to the following definitions:
1.5.1. High Priority shall mean an emergency condition which causes
critical impact or which makes the performance or continued
performance of any one or more functions impossible.
1.5.2. Medium Priority shall mean a condition which significantly
affects or which makes the performance or continued performance
of any one or more functions difficult and which can be
circumvented or avoided on a temporary basis.
1.5.3. Low Priority shall mean a documentation error or a limited
problem condition which is not critical and which may be
circumvented or avoided on a temporary basis.
2. Clientele
2.1. Clientele is a secure database tracking system that is accessible
through the World Wide Web. It is used to deliver fixes, contains a
Technical Answer book, product updates and announcements.
3. CYBG will provide warranty support through the support hot line for the 90
day warranty period.
4. Support shall be provided based on reasonable commercial practices
that may change from time to time.
<PAGE> 23
EXHIBIT B
CyberGuard? Software License Agreement
EXHIBIT C
Distributor Price Book
EXHIBIT D
PROGRAM CONDITIONS
o Cooperative funds are to be used only for the promotion of CyberGuard
Corporation products.
o Funds remaining in the Distributor's co-op account upon termination of
the relationship between the Distributor and CyberGuard Corporation
will revert back to CyberGuard Corporation.
o CyberGuard Corporation will not be held responsible for the contents of
any marketing activity other than those produced by CyberGuard
Corporation and featured without modification.
o CyberGuard Corporation reserves the right to refuse authorization or
reimbursement for activities that CyberGuard Corporation determines to
contain material errors, improper identification or treatment
detrimental to the image of CyberGuard Corporation and its products.
o CyberGuard Corporation reserves the right to modify this program at any
time.
o It is the responsibility of the Distributor to notify CyberGuard
Corporation of personnel changes regarding co-op contacts.
o Accrued funds can only be used to reimburse the Distributor for
preauthorized activities, which meet the criteria set forth by this
policy.
o The CyberGuard Corporation name and authorized logo must be displayed
prominently and in accordance with the guidelines of logo usage as
stated in this policy.
o To qualify for reimbursement by cooperative funding, all advertising
and promotional activities must receive prior authorization from
CyberGuard Corporation.
o Cooperative funds cannot be deducted from CyberGuard Corporation
invoices without prior written consent.
o Funds earned during the first half of the fiscal year are available for
spending during the half earned and the half that follows. Funds earned
during the last half of the fiscal year are available for spending
during the half earned and the half that follows.
o Claims for reimbursement must be submitted on a CyberGuard Corporation
claim form within sixty (60) days of the activity's execution with all
appropriate documentation attached.
o Co-op reimbursement will be issued via credit memo unless otherwise
stated. o CyberGuard Corporation will issue statements of account for
co-op funding on a quarterly basis.
<PAGE> 24
EXHIBIT E
MUTUAL NON-DISCLOSURE AGREEMENT
THIS AGREEMENT is made and entered into by and between CyberGuard Corporation, a
Florida corporation, having a principal place of business at 2000 W. Commercial
Blvd., Suite 200, Fort Lauderdale, Florida, 33309 (hereinafter referred to as
"CyberGuard"), and Information Resource Engineering, Inc., a Delaware
corporation, having a principal place of business at 8029 Corporate Drive,
Baltimore, MD 21236 ___________ (hereinafter referred to as "Company").
WHEREAS, CyberGuard and Company are desirous of exchanging information for the
purpose of exploring the possibility of the two companies working together, to
the mutual benefit of both parties hereto.
AND WHEREAS, if the parties determine to work together, the exchange of
information will continue throughout the parties' working relationship.
AND WHEREAS, one party hereto (OWNER) may disclose to the other party hereto
(RECIPIENT), certain information pursuant to this Agreement which the OWNER
deems proprietary and confidential.
NOW, THEREFORE, the parties hereto agree as follows:
1. For a period of three (3) years from the date of receipt of any
"Confidential Information" (as defined below), each RECIPIENT shall use
reasonable efforts to prevent the disclosure to any other person, firm or
corporation of any Confidential Information which it receives from OWNER.
RECIPIENT shall also use the same degree of care to avoid disclosure of
such information as RECIPIENT employs with respect to its own proprietary
and confidential information of like importance and shall limit disclosure
of the Confidential Information to those of its personnel and personnel of
its affiliated companies and its outside professional firms who have an
actual need to know and have an obligation to protect the confidentiality
of such Information consistent with the requirements of this Agreement.
RECIPIENT also agrees not to use the Confidential Information for any
purpose other than the purpose described in the recitals to this Agreement.
2. Any reports or other documents resulting from such exchange of information
between the parties shall be governed by the same terms and conditions with
respect to confidentiality as is the exchange of Confidential Information
between the parties.
3. Notwithstanding the foregoing, information shall not be deemed Confidential
Information and RECIPIENT shall have no obligation with respect to any such
information which
a. is already known to RECIPIENT, and such prior knowledge can be
demonstrated through physical evidence that pre-dates this
Agreement, or
h. is or becomes publicly known through publication or otherwise and
through no wrongful act of RECIPIENT, or
i. is received from a third party without similar restriction and
without breach of this Agreement, or
<PAGE> 25
j. is independently developed by RECIPIENT, or
k. is furnished to a third party by OWNER without a similar
restriction on the third party's rights, or
l. is approved for release by written authorization of OWNER (so long
as such release complies with any requirements of the
authorization), or
m. is disclosed pursuant to the lawfully imposed requirement of a
governmental agency or disclosure is required by operation of law.
4. Each of the Parties hereto acknowledge that irreparable harm, for which
there would be no adequate remedy at law, would arise from a violation of
this Agreement. Therefore, each Party acknowledges that a breach of this
Agreement would give rise to a right to an injunction in favor of the
non-breaching party. Notwithstanding the foregoing, the parties are
entitled to pursue any appropriate remedies at law or in equity for breach
of this Agreement. This Agreement constitutes the entire agreement of the
parties hereto with respect to confidentiality of business information and
supersedes any prior agreements or understandings of the parties hereto
regarding such information. This Agreement shall be construed in accordance
with the laws of the State of Florida. This Agreement may be amended or
modified only in a writing signed by both parties.
5. All Confidential Information that is in any reproducible form (including
without limitation, written or electronic form) delivered by one party
hereto to the other party shall be and remain the property of the
delivering party, and all such data, and any copies thereof, shall be
promptly returned to the delivering party upon written request, or
destroyed at the delivering party's option.
6. This Agreement shall not be construed as granting or conferring any rights
by license or otherwise, expressly, impliedly, or otherwise for any
invention, discovery or improvement made, conceived or acquired prior to or
after the date of this Agreement.
7. Nothing contained in this Agreement shall constitute a commitment by either
party to the development or release of any future products and/or programs
disclosed thereby or restrict either party in its efforts to improve its
existing products and systems and to conceive and develop new products and
systems. Additionally, participation in the information exchange pursuant
to this Agreement shall not constitute or imply a commitment by either
party to favor or recommend any product or service of the other party.
8. For the purposes of this Agreement, "Confidential Information" shall mean
any information that is disclosed to RECIPIENT by the OWNER that has been
created, developed, discovered, discerned, acquired, licensed or purchased
by the OWNER, including without limitation, information relating to any
product, process, development, research work, business line, business
strategy or intellectual property of any kind, and shall include, without
limitation, inventions, improvements, discoveries, creations, computer
programs, computer hardware, design specifications, concepts, formulas,
trade secrets, ideas, processes, know-how, methods, proprietary data,
software code, source code, products, future products, techniques, any and
all derivative works therefrom and any and all patents and copyrights
therein or any improvements thereof.
<PAGE> 26
IN WITNESS WHEREOF, the parties hereto agree that the effective date of this
Agreement shall be the 11th day of June, 1998.
CyberGuard Corporation Information Resource Engineering, Inc.
By: By:
------------------------- ------------------------------
Signature Signature
------------------------- ------------------------------
Print or type name Print or type name
------------------------- ------------------------------
Title Title
<PAGE> 27
EXHIBIT G
Territory and Agreements
D1 Territory
Territory means world-wide, except the prohibited countries identified
by the United States government, with the following restrictions and
exclusions:
a) Distributor shall purchase UNIX-based firewall products for
sale in Japan from CyberGuard's regional Authorized
Distributor at the regional Authorized Distributor's terms and
conditions. The discount level is established in Exhibit C of
this Agreement.
D2 Agreements
The business relationship between Information Resource Engineering,
Inc. and CyberGuard Corporation is represented in this Distributor
Agreement and a separate OEM Agreement, dated June 11, 1998. These
agreements and their exhibits express the entire agreement and
understanding of the parties and supersede all prior oral or written
agreements, negotiations, commitments and understandings pertaining to
the subject matter hereof. Any modifications of or changes to this
Agreement shall be in writing and signed by both parties.
<PAGE> 28
June 11, 1998
Anthony A. Caputo
Information Resource Engineering, Inc.
8029 Corporate Drive
Baltimore, MD 21236
Dear Mr. Caputo:
CyberGuard Corporation ("CyberGuard") acknowledges that on August 6, 1996,
Information Resource Engineering, Inc. ("IRE") has paid to CyberGuard a prepaid
license fee in the amount of $1,000,000.00 (one million US dollars) ("Prepaid
License Fee").
The Prepaid License Fee, less amounts already credited, shall represent a
prepayment of the amounts that will become due under the June 11, 1998
Distribution Agreement and the June 11, 1998 OEM Agreement executed by IRE and
CyberGuard, including the $250,000 Right-to-Manufacture Fee, and shall be
credited to IRE's account on a dollar-for-dollar basis against any amounts that
otherwise will become due to CyberGuard under the two agreements referenced
above. CyberGuard agrees to repay to IRE the unused balance of the Prepaid
License Fee, if any, on or before December 31, 1998.
Please indicate by your signature below your acceptance of the above terms.
Sincerely,
Tommy D. Steele
President and Chief Operating Officer
CyberGuard Corporation
ACCEPTED AND AGREED TO:
/s/ Anthony Caputo, CEO