Sample Business Contracts

Professional Services Agreement - Protege Software (Holdings) Ltd. and NetGravity Inc.

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                                PROTEGE CONFIDENTIAL


This PROFESSIONAL SERVICES AGREEMENT (the "Agreement") is made this 27th day of
March 1997 between PROTEGE SOFTWARE (HOLDINGS) LIMITED of Richmond House, St
Anne's Place, St. Peter Port, Guernsey, GY1 2NV Channel Islands (the
"Contractor") and NETGRAVITY Inc. of Delaware, USA ("the Company") who agree as

1.   TERM

     The initial term of this Agreement shall begin at the date of signing by
     the later of the two parties to sign (the "Effective Date"), and shall end
     on the termination of the Agreement by either party in accordance with
     Paragraph 7.


     (a)  The Contractor agrees to act as General Manager for the Company and
          perform the Professional Services specified in the Work Assignment
          Schedule contained in Schedule A, as modified from time to time by
          mutual agreement of the parties (the "Professional Services")

          (i)   to set up a wholly owned subsidiary company of the Company
                (subject to local approval) to be called NetGravity Europe

          (ii)  to set up such other corporation or entities, or in furtherance
                of distribution, marketing or agency relationships with third
                parties as the Company and Contractor agree to establish in
                the Territory (as defined in Schedule A).

     (b)  The Contractor shall perform the Professional Services for Company,
          and shall in all cases act in a professional manner and such services
          shall conform to the standards, specifications and other reasonable
          requirements agreed between the parties.

     (c)  The Contractor agrees to submit monthly progress reports to the


     The Company shall reward the Contractor for its activities as contained in
     Schedule A.




     (a)  Each party acknowledges that it may be furnished or may otherwise
          receive or have access to confidential or proprietary information
          which relates to the other party's business, including (without
          limitation) past, present or future business plans, marketing plans,
          products, software, research, development, inventions, processes,
          techniques, design or other technical information and data, etc. (the
          "Proprietary Information").  Each party further acknowledges that all
          intellectual property rights residing in the other party's
          Proprietary Information are and will remain the exclusive property
          of the other party.

     (b)  Each party agrees to preserve and protect the confidentiality of
          the Proprietary Information and all forms thereof, whether
          disclosed to it before this Agreement is signed or afterwards.  In
          addition, it shall not disclose or disseminate the Proprietary
          Information to any third party and shall not use the Proprietary
          Information for its own benefit (other than in furtherance of the
          goals of the other party) or for the benefit of any third party
          (other than in furtherance of the goals of the other party).

     (c)  The foregoing obligations shall not apply to any information which
          the recipient can prove (i) is previously publicly known at the
          time of receipt from the other party or which subsequently becomes
          publicly known through no act or fault of the recipient; (ii) is
          given to it by a third party who is not obligated to maintain
          confidentiality; or (iii) was independently developed by it without
          resort to the Proprietary Information or other resources of the
          other and not in the course of performance of the Professional
          Services, and not for the other party, (unless the parties have
          otherwise agreed that the specific information was to be governed
          by this Agreement).

     (d)  Within three days after the termination of this Agreement (or any
          other time at the other party's request), each party shall return
          to the other all copies of Proprietary Information in tangible form
          in its possession or control.  The Contractor hereby assigns to the
          Company all its intellectual and other property rights in its work
          product performed pursuant to this Agreement, and waives its moral
          rights to or in same, and shall require each of its employees (if
          any are so permitted by the Company pursuant to Schedule A) working
          on this project to sign the Company's standard independent
          contractor confidentiality agreement, and assignment of
          intellectual property rights and waiver of moral rights.



     (e)  Section 4 of this Agreement shall survive the expiry or termination of
          the Agreement.



          (i)   it is able to perform the Professional Services, as set out in
                the agreed business plan;

          (ii)  that any service it provides and information or materials it
                develops for or discloses to the Company shall not in any way
                be based upon any confidential or proprietary information
                derived from any source other than the Company, unless the
                Contractor is specifically authorised in writing by such
                source to use such proprietary information and the Contractor
                agrees it shall not knowingly furnish or use any such
                information in the performance of this Agreement, without the
                prior written consent of the Company provided that the
                Company agrees the Contractor can use commercially available
                software development tools;

          (iii) in performance of its obligations hereunder it shall not
                infringe any intellectual property right, or trade secret of
                any third party;

          (iv)  it shall perform all work in a professional manner to the best
                of its ability; and

          (v)   that if the Company incurs any liability or expense outside
                of the agreed business plan, as a result of any warranty that
                the Contractor makes in this Agreement not being true, the
                Contractor shall indemnify the Company and hold it harmless
                against all such liability or expense, including reasonable
                attorney/solicitor fees, provided that the Company notifies
                the Contractor of the claim and co-operates with the
                Contractor in defending against the claim.  Each party shall
                notify the other if it ever becomes aware of any such claim.


          (i)   it is entitled to appoint the Contractor to perform the
                Professional Services in the Territory;

          (ii)  that any information or materials it discloses to the
                Contractor shall not in any way be based upon any confidential
                or proprietary information



                derived from any source other than the Contractor or the
                Company, unless the Company is specifically authorised in
                writing by such source to use such proprietary information;

          (iii) in performance of its obligations and the provision of
                information to the Contractor hereunder it will not infringe
                any intellectual property right, or trade secret of any
                third party;

          (iv)  if the Contractor incurs any liability or expense as a result
                of any warranty the Company makes in this Agreement not being
                true, the Company shall indemnify the Contractor and hold it
                harmless against all such liability or expense, including
                reasonable attorney/solicitor fees, provided that the
                Contractor notifies the Company of the claim and cooperates
                with the Company in defending against the claim.  Each party
                shall notify the other if it ever becomes aware of any such
                claim; and

          (v)   it will sell it's products and services in the Territory only
                through NetGravity Europe Ltd.  In respect of any sales
                received by the Company and its Group generated on a world-wide
                basis, the parties agree that 30% - 50% of the European
                revenues will be included in the calculation of Net Revenue for
                the purposes of the Schedule.  The precise figure will be
                mutually agreed by both parties acting in good faith.


     If the Company loans the Contractor any item, the Contractor shall sign the
     Company's standard equipment loan agreement and return the loaned equipment
     promptly on termination of this Agreement.  The same shall apply to any
     item loaned by the Contractor to the Company or NetGravity Europe.


     (a)  The Initial Term shall be for a 12 month period from the Effective
          Date (the "Initial Term").

     (b)  This Agreement shall automatically continue, following the expiry of
          the Initial Term for subsequent periods of 12 months ("Renewal Terms")
          each unless terminated in accordance with the terms set out below.

     (c)  This Agreement may be terminated by either party, as follows:



          (i)   without cause, after the Initial Term, on at least 3 months
                written notice, provided that if the Company fails to renew any
                Renewal Term, it shall provide at least 3 months notice or
                payment in lieu thereof.

          (ii)  during the Initial Term, or any Renewal Term, if the other party
                has not performed any material covenant when performance was
                due or has otherwise breached any material term of this
                Agreement, the following procedures shall apply:

                (A) the non-defaulting party shall provide written notice
                    of the event or circumstances representing such breach
                    or non-performance together with a demand that such
                    breach or non-performance be cured immediately;

                (B) if the breach or non-performance has not been cured (or
                    other arrangements satisfactory to the non-defaulting
                    party have not been agreed to) within 30 days from the
                    date of the notice delivered under clause (A) above,
                    immediately upon delivery of a second written notice
                    terminating this Agreement.


     (a)  The laws of England and Wales shall govern this Agreement and the
          parties hereby submit to the exclusive jurisdiction of the English

     (b)  This Agreement, including Schedule A attached hereto, is the entire
          agreement between the parties.  Any change in the Agreement must be
          made in writing and signed by both the Company and the Contractor.

     (c)  If either party cannot perform of its respective obligations due to
          causes beyond its reasonable control which shall not include the
          reward to the Contractor under Schedule A, then the non-performing
          party shall (i) notify the other party, (ii) take reasonable steps to
          resume performance as soon as possible, and (iii) not be considered in
          breach during the period performance is beyond the party's reasonable

     (d)  If any provision of this Agreement shall be deemed by a court to be
          too broad, the court is hereby authorised to limit any scope,
          duration or area of applicability, or all of them, so such provision
          is no longer overly broad and to enforce the same as so limited.
          Subject to the prior sentence, if any part of this Agreement is held
          unenforceable for any reason, such unenforceability shall



          void only such part and shall not render unenforceable any other part
          of this Agreement.

     (e)  Either party's waiver of a default by the other does not constitute a
          waiver of future or other defaults.

     (f)  The parties shall not, for 12 months after the Agreement ends,
          directly solicit for employment or any other engagement for work, any
          employee or any employee of any affiliate of the other party.  In this
          Agreement, Affiliate means a company under the ultimate common control
          of the other party of which the party has been notified.

     (g)  The Contractor shall not assign its rights or obligations under this
          Agreement unless it first obtains the prior written agreement of the

     (h)  Any notice or other communication required or permitted to be given by
          his Agreement (including the signing of this Agreement) shall be in
          writing and shall be effectively given if delivered personally, by
          facsimile confirmed received, or by registered mail to the party at
          the relevant party's address below.

Dated at San Mateo, CA, USA this 27 day of March 1997

/s/ Stephen E. Recht
duly authorised for and on behalf of



Dated at San Mateo, this 27 day of March 1997

/s/ Larry Levy
duly authorised for and on behalf of
of Richmond House, St. Anne's Place, St. Peter Port,
Guernsey, GY1 2NV, Channel Islands



                                      SCHEDULE A

                               WORK ASSIGNMENT SCHEDULE

Territory - For purposes of this Agreement, Territory means Europe, Africa and
the Middle East, subject to then prevailing export regulations in Canada, the
United States or countries in which NetGravity Europe resides.  Europe means
those countries set out in Schedule B. Middle East means all Arab League
countries, Turkey and Israel.

Analysis and Recommendations re:

*    Marketing positioning;
*    Presentation;
*    Technical Support;
*    Competitiveness;
*    Localisation

Implementation of approved Recommendations:

*    Sales,
*    Marketing,
*    Technical Support,
*    Production,
*    Finance and Administration

all for operations, in the Territory, as more particularly set out in the annual
business plans (including budgets) of the Company as said plans and budgets
relate to its operations implemented directly or through:

*    NetGravity Europe, and/or

*    such other corporations or entities, or in furtherance of distribution,
     marketing or agency relationships with such third parties, as the Company
     and the Contractor agree to establish in the Territory;

The business plan and budgets shall be mutually agreed upon by Contractor and

This implementation will include, but not necessary be limited to, the




During the term, Contractor shall perform the following activities in the

*    Establishment of an organisation for the Territory, to complement the
     current resources, technology and economic considerations of the Company,
     and the circumstances that prevail in the Territory.

*    Achieving this by the setting up of NetGravity Europe Ltd to initially be a
     UK based wholly owned subsidiary of the Company, to serve as the
     Territorial headquarters so that Company may professionally provide the

     (a)  solicitation of sales orders;

     (b)  provision of support for Company's distributors and dealers in the

     (c)  co-ordination of product and warranty service between NetGravity
          Europe and such other affiliated or third party, arms length
          corporations or entities, and licensees and distributors/VARs etc.
          of the Company's products, located in the Territory;

     (d)  provision of product technical support services;

     (e)  the conducting of periodic training courses and seminars regarding
          applications and operations of the products in major marketing centres
          located in the Territory for the benefit of distributors and dealers

     (f)  development of business plans for the Territory;

     (g)  management and co-ordination of the implementation of the Company's
          marketing strategy in the Territory (for the products of Company
          handled by Contractor);

     (h)  localisation of products;

     (i)  set up of systems (such as accounting legal and human resources
          consistent with those set-up by the Company); the Contractor shall
          assist NetGravity Europe (and other related entities as agreed
          following Company's request) with implementation and administration of
          all general, administrative and financial systems as requested by
          Company; and




(a)  NetGravity Europe shall solicit orders for product only at such current
     prices as may be periodically established in writing by the Company and
     notified to the Contractor.

(b)  All orders solicited by NetGravity Europe from customers in the Territory
     are subject to acceptance or rejection by an officer or other authorised
     person at the principal office of the Company, which approval or rejection
     shall in all cases be in writing, and no order shall be binding upon
     NetGravity Europe until so accepted.  The Company and NetGravity Europe
     reserve the right to refuse any order originating in the Territory, either
     for lack of credit of the customer or for any other reason which, in the
     judgement of the Company or NetGravity Europe is reasonable grounds for
     refusal.  The Contractor agrees to cause NetGravity Europe to fully inform
     all customers it solicits of the substance of this sub-paragraph and to
     furnish NetGravity Europe and the Company with such periodic reports of its
     activity and other information as the Company may reasonably request.

(c)  The Contractor agrees to dispatch all inquiries received by it, applicable
     to the Company or the products of the Company, from points or sources
     outside the Territory promptly to the Company for attention and handling.

(d)  Neither NetGravity Europe nor the Company is under any obligation to the
     Contractor to continue its business or to manufacture, sell or supply, or
     to continue to manufacture, sell or supply any of the products nor shall
     any warranty of any nature as to any products run from NetGravity Europe,
     the Company, or their affiliates to the Contractor, and neither the Company
     nor its affiliates are under any obligations to the Contractor to continue,
     discontinue, or change any model or type of any of the products.

(e)  All invoices in connection with sales to customers in the Territory shall
     be rendered by NetGravity Europe to such customers.  It is expressly
     understood that full power by and such authority for all collections rest
     with NetGravity Europe and the Company, which exercises complete control
     over the approval of all customers' credit, orders, and contracts.  The
     Contractor agrees to protect NetGravity Europe and the Company, as far as
     is reasonable by reporting adverse credit information of which it is aware
     with respect to customers in the Territory.



                              CONTRACTOR REWARD SCHEDULE


     A.   Contractor shall be paid a commission equal to 5% of annual Net
          Revenue NetGravity Europe, subject to a minimum of 75,000 Pounds ("the
          minimum commission") and a maximum of 150,000 Pounds in each year of
          the Initial Term and any Renewal Term.

     B.   In this Agreement, the currency is in UK pounds sterling.

     C.   Payment of commission shall be made to Contractor as follows:

          (i)   monthly in arrears, on the basis of estimated commission
                subject to an annual adjustment and repayment of any over

          (ii)  within 30 days after the end of each calendar quarter, the
                parties shall calculate the actual commission due to
                Contractor, and the balance due shall be paid or repaid before
                the end of said 30th day.

     D.   Net Revenue means gross revenue from licenses of NetGravity Europe
          product, net of returns, allowances, credits, discounts (based on
          volume or otherwise), RMAs and net of any bad debt reserve or actual
          bad debts.  All reserves will be calculated on a consistent basis in
          accordance with generally accepted accounting principles.

2.   BONUS

     A.   In addition to the commission referred to above, Contractor shall also
          be paid a bonus, calculated as set out below.

     B.   The bonus shall be calculated as a percentage of revenue, as defined
          in the Table below, of one times the Annualised Net revenue of
          NetGravity Europe.  Annualised Net Revenue means Net Revenue for the
          12 months immediately prior to the date on which the bonus payment
          obligation is triggered.

     C.   TERM OF SERVICE                 % BONUS

          0-12 months                        20%

          GREATER THAN 12-18 months          15%

          GREATER THAN 18 months             10%



     D.   The bonus payment can be triggered either:

          (a)   by the Contractor at any time after the date 24 months after
                the Effective Date

          (a)   on termination of the agreement as defined in paragraph 7

          (c)   change of control of the Company.

     E.   Triggering by the Contractor of the bonus payment shall constitute an
          event which entitles (but does not require) Company to terminate this
          Agreement without payment of additional compensation to Contractor.

     F.   Company may, at its option, pay the bonus in either cash or in shares
          of the Company or any successor company.


     The Company will reimburse Contractor within thirty (30) days after the end
     of each fiscal month an amount equal to one hundred per cent (100%) of all
     costs approved within the agreed business plan or otherwise agreed to by
     the Company, and reasonably incurred by Contractor in good faith and
     reasonable fulfilment of Contractor's obligations under this Agreement.
     For the avoidance of doubt, the cost and expense of the provision of a
     managing director by the Contractor shall not be recharged to the Company
     and shall be treated as comprised in commission.  The Contractor will keep
     records of (and receipts for) all costs in incurs in its performance of the
     services and will provide copies of such records to the Company upon
     reasonable request.


                                      SCHEDULE B


Such of the countries listed below, except to the extent that Sales of the
Company's products are prohibited pursuant to the laws of the United States or
other jurisdiction applicable to the Company's operations.

     Albania                                 Liechtenstein
     Andorra                                 Lithuania
     Armenia                                 Luxembourg
     Austria                                 Macedonia
     Azerbaijan                              Malta & Gozo
     Belarus                                 Moldova
     Belgium                                 Monaco
     Bosnia                                  The Netherlands
     Bulgaria                                Norway
     Byclorussia                             Poland
     Croatia                                 Portugal
     Cyprus                                  Romania
     Czech Republic                          Russia Federation
     Denmark                                 San Marino
     Estonia                                 Serbia
     Federal Republic of Yugoslavia          Slovak Republic
     Finland                                 Slovenia
     France                                  Spain
     Germany                                 Sweden
     Gibraltar                               Switzerland
     Greece                                  Tajikistan
     Hungary                                 Turkey
     Iceland                                 Turkmenistan
     Republic of Ireland                     Ukraine
     Italy                                   United Kingdom
     Kazakhstan                              Uzbekistan
     Kyrgyzstan                              Vatican City State



                            PROTEGE CONFIDENTIAL


This Amendment To The Professional Services Agreement dated 27 March 1997
between PROTEGE SOFTWARE (HOLDINGS) LIMITED of Richmond House, St Anne's
Place, St. Peter Port, Guernsey, GY1 2NV Channel Islands (the "Contractor")
and NETGRAVITY INC of Delaware United States of America ("the Company") (the
"Agreement") is made this day of 13 May 1998 who agree as follows:


1.1 The parties have agreed that the Agreement shall terminate with effect
from 30 September 1998, subject always to the terms of this Amendment to the
Professional Services Agreement.

1.2 The parties have agreed to use reasonable endeavours to co-operate to
achieve the assumption by the Company of the Professional Services with
effect from 30 September 1998 save that the Contractor has agreed to continue
to provide back office functions for the Company to 30 October 1998 for the
purpose of assisting the Company in collating financial information in
relation to activities in the Territory during the financial quarter of the
Company ending 30 September 1998.


2.1 The parties have agreed that the bonus payable to the Contractor shall be
calculated as 12.5% of the Bookings of NetGravity Europe for the 12 month
period ending 30 September 1998.

Bookings means Licence bookings, First year subscription bookings, Second year
subscription bookings, consulting revenues and support revenues.

2.2 On or before 15 May 1998, the Company shall pay the Contractor the sum of
L100,000 (one hundred thousand pounds sterling) as part payment of the
anticipated bonus payable to the Contractor. The balance of the bonus shall
be paid in cash by the Company to the contractor on or before 30 October 1998.

2.3 The Company agrees and undertakes to use its best efforts to have the
Contractor participate in the forthcoming sale of shares in the Company to
the public by being granted the right to subscribe for approximately 10,000
transferable voting shares in the Company, or as many as are allocated by the
underwriters, at the offering price to the public.




Subject to compliance by the Company with the terms of this Amendment to the
Professional Services Agreement, the Contractor confirms that the Company may
offers terms of employment to Jitendra Valera.


Save as amended and varied by this Amendment to the Professional Services
Agreement, the terms and obligations of the Agreement are otherwise

/s/ Stephen E. Recht  CFO
duly authorised for and on behalf of

   Dated at   San Mateo, CA, USA   this  13  day of    May    1998
            ---------------------       ----        ---------

/s/ Larry Levy
duly authorised for and on behalf of
of Richmond House, St Anne's Place, St. Peter Port,
Guernsey, GY1 2NV, Channel Islands

Dated at London, England this 13th Day of May 1998.