Independent Contractor Agreement - Red Hat Software Inc. and Ingo Molnar
INDEPENDENT CONTRACTOR AGREEMENT
This is an independent contractor software development and services agreement.
Red Hat Software, Inc. ("Red Hat"), a Connecticut, USA corporation, and Ingo
Molnar ("Molnar"), a resident of Hungary, enter into this agreement as of the
last date following the signatures below.
1. DEFINITIONS.
A. " Linux" means the Red Hat Linux operating system computer software for
Intel and compatible based computers, version 5.1 and later versions released by
Red Hat during the term of this Agreement.
B. "Red Hat Product" means the product of Red Hat currently known as " Official
Red Hat Linux for Intel-based computers, version 5.1 and later versions released
by Red Hat during the term of this Agreement.
C. " Molnar Software" means any and all software developed and provided to Red
Hat by Molnar pursuant to this Agreement.
D. " Bugs" means errors in a software program that cause the software to fail to
function as intended.
E. "Source Code" means software in written form which is the preferred form
for making modifications to the software and which is easily understood by a
human knowledgeable in the art of computer programming.
F. "Binary Code" means software in machine-readable form that is not easily
understood by a human knowledgeable in the art of computer programming, but
which is understood and used by a computer to run the software.
K. "Confidential Information" means any information identified as being
Confidential Information by either party, either orally or in writing, at the
time it is disclosed, or designated as confidential in writing (either
electronically or by other means) within 30 days of the disclosure, provided
that the information (a) was not publicly known or generally in the public
domain prior to the disclosure, (b) does not become generally known or part of
the public domain through any improper action or disclosure by the receiving
party, or (c) can be shown to have been in the rightful possession of the
receiving party prior to having been identified as Confidential Information 9 by
the disclosing party.
2. WORK MADE FOR HIRE.
A. Molnar shall perform software development and consulting work as follows:
1. Enhance software-RAID support, including, but not limited to, stability,
performance, and feature enhancements; 2. Tuning the memory handling of the
Linux kernel for a variety of machine configurations; 3. Enhancing SMP
scalability, performance and stability; and 4. Working with
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Stephen Tweedie and other kernel developers on the design and implementation of
a log-based filesystem for the Linux kernel.
B. The Source Code to be written by Molnar pursuant to this Agreement shall be a
work made for hire, and Red Hat shall be the sole owner of the copyright of the
Source Code.
3. INDEPENDENT CONTRACTOR.
Molnar shall be an independent contractor with respect to Red Hat. This
Agreement shall not render Molnar an employee, partner, agent of, or joint
venturer with Red Hat for any purpose. Red Hat shall not be responsible for
withholding taxes with respect to Molnar's compensation hereunder. Molnar shall
have no claim against Red Hat for vacation pay, sick leave, retirement benefits,
social security, worker's compensation, health or disability benefits,
unemployment insurance benefits, or employee benefits of any kind.
4. PAYMENT.
A. In consideration for the work outlined in this Agreement, Red Hat shall make
monthly payments to Molnar in the amount of [CONFIDENTIAL TREATMENT
REQUESTED]**. Both parties may modify at any time the amounts to be paid by Red
Hat to Molnar, but any and all such modifications shall be in writing and shall
be signed by both parties in order to be effective.
B. Payment shall be made in U.S. funds on the last standard business day in the
United States of each month for the work performed that month. Work performed
for less than a full month shall be prorated accordingly. Payment shall be made
via bank wire transfer, or other means agreed to by both parties. Molnar shall
bear the risk of any fluctuation in currency exchange rates between U.S. and
Hungary currency.
5. NON-EXCLUSIVITY.
This Agreement is a non-exclusive agreement, and both parties remain free to
enter into similar agreements with third parties. In the event that Molnar
enters into an agreement with a third party in which Molnar performs software
development, consulting, or other services related to Linux, Molnar shall inform
Red Hat of that agreement at or before the time he enters into such agreement.
Nothing in this section limits or supercedes the provisions of Section 7.
6. QUALITY AND TESTING.
Molnar shall thoroughly test the quality of all Source Code and Binary Code it
delivers to Red Hat in accordance with customary practice within the industry.
All such code delivered to Red Hat by Molnar shall be of commercial production
quality. Red Hat shall have the option to test all such code pursuant to its own
quality assurance procedures, and may reject any code it reasonably believes
does not meet commercial production quality. In the event that Bugs are
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AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
RULE 406 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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discovered in the Molnar Software, Molnar will use his best efforts to correct
the Bugs in an expeditious manner.
7. CONFIDENTIALITY.
A. Both Red Hat and Molnar agree that during the term of his Agreement, each
party, may disclose to the other party certain Confidential Information. Either
party may designate any information it provides to the other party as
Confidential Information, and the receiving party shall not disclose that
information to third parties without the express permission of the disclosing
party. Information designated as Confidential Information shall remain
confidential until the disclosing party designates it as non-confidential or
until the information becomes public through no fault of the receiving party.
B. Both Red Hat and Molnar agree that in the event either party breaches or
threatens to breach the provisions of this section, such breach or threatened
breach would cause irreparable harm to the non-breaching party, and the
non-breaching party would be entitled to injunctive and other equitable relief
to prevent such breach or to remedy an actual breach.
8. LIMITED WARRANTY.
A. Red Hat warrants that it has the right and authority to enter into this
Agreement, and that it will use its commercially reasonable best efforts to
distribute and market the Red Hat Product.
B. Molnar warrants that he has the, right and authority to enter into this
Agreement, and that, to the best of his knowledge, the Molnar Software does not
and will not infringe upon any patent, copyright, trade secret, or other
intellectual property interest of any third party. Molnar warrants that he will
take all due and reasonable care to avoid infringing any patent, copyright,
trade secret, or other intellectual property interest of any third party.
9. ADDITIONAL OBLIGATIONS.
Molnar shall establish and maintain sufficient office space, computer hardware,
Internet access, and other equipment and services necessary to enable it to
perform its obligations under this Agreement in a professional and timely
fashion. In the event that Molnar requires additional computer hardware in order
to perform its responsibilities under this Agreement, Red Hat will purchase or
reimburse Molnar for the cost of such hardware. All such hardware purchases must
be approved in advance by Red Hat, and Red Hat agrees to lease all such hardware
to Molnar at no charge to Molnar during the term of this Agreement. Upon the
termination of this Agreement for any reason, Molnar shall return to Red Hat all
such hardware.
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**[CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
RULE 406 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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10. TERM AND TERMINATION
This agreement shall begin on the date it is signed by both parties. Either
party may terminate this Agreement by written (electronic or other means) notice
of termination, which shall be effective upon receipt, at least 30 days in
advance of termination.
11. INDEMNITY
A. Molnar shall defend, indemnify, and hold Red Hat harmless from and against
any liability, suits, claims, losses, damages and judgments, and shall pay all
costs (including reasonable attorney's fees) and damages arising from a claim
that Molnar Software infringes any third party's patent, copyright, trademark or
other intellectual property interest, except as provided in Section ll.B. below.
The provisions of this Section shall survive the termination of this Agreement.
B. Red Hat shall defend, indemnify, and hold harmless Molnar from and against
any liability, suits, claims, losses, damages and judgments against Molnar made
in the United States related to this Agreement, provided that Molnar promptly
notifies Red Hat of any and all such claims and provided that Red Hat is given
control over the defense of any and all such claims. The provisions of this
Section shall survive the termination of this Agreement.
12. LIMITATION ON LIABILITY
To the extent allowed by applicable law, IN NO EVENT SHALL RFD HAT, ITS
SUPPLIERS, DISTRIBUTORS, OR RESELLERS, BE LIABLE FOR ANY DAMAGES WHATSOEVER,
INCLUDING WITHOUT LIMITATION, ANY LOSS OF PROFITS, LOSS OF BUSINESS, LOSS OF USE
OR DATA, INTERRUPTION OF BUSINESS, OR FOR DIRECT, INDIRECT, SPECIAL, INCIDENTAL,
OR CONSEQUENTIAL DAMAGES OF ANY KIND, EVEN IF RED HAT HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES AND NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE
OF ANY LIMITED REMEDY. (b) EXCEPT AS PROVIDED IN THIS AGREEMENT, IN NO EVENT
WILL RED HAT, ITS SUPPLIERS, DISTRIBUTORS, OR RESELLERS, BE LIABLE FOR ANY CLAIM
AGAINST MOLNAR BY ANY THIRD PARTY. (C) IN NO EVENT SHALL RED HAT, ITS SUPPLIERS,
DISTRIBUTORS, OR RESELLERS, BE LIABLE FOR (i) ANY REPRESENTATION OR WARRANTY
MADE TO ANY THIRD PARTY BY MOLNAR, ITS DISTRIBUTOR, OR ITS AGENTS; (ii) FAILURE
OF THE SOFTWARE OR THE PRODUCT TO PERFORM; (iii) FAILURE OF THE SOFTWARE OR THE
PRODUCT TO PROVIDE SECURITY; OR (iv) THE RESULTS OR INFORMATION OBTAINED OR
DECISIONS MADE BY END USERS OF THE SOFTWARE OR THE PRODUCTS OR THE
DOCUMENTATION. THIS LIMITATION OF LIABILITY IS AN ESSENTIAL PART OF THE BARGAIN
UNDER THIS AGREEMENT.
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**[CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
RULE 406 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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13. MISCELLANEOUS.
A. This Agreement shall be governed by and shall be construed in accordance with
the laws of the State of North Carolina, U.S.A., regardless of its choice of law
provisions. Any dispute, controversy or other claim arising out of this
Agreement shall be resolved in an appropriate state or federal court within
North Carolina. The parties each agree that they are subject to the personal
jurisdiction of the state and federal courts within the State of North Carolina,
and each waives the right to challenge the personal jurisdiction of those courts
over it. The United Nations Convention on Contracts for the Sale of Goods shall
not apply to this Agreement.
B. Any notice under this Agreement shall be in English, in writing, and shall
be deemed to be given upon receipt. Notices to Red Hat shall be delivered to
Contracts Manager, Red Hat Software, Inc., 4201 Research Commons, Suite 100,
79 Alexander Drive, P.O. Box 13588, Research Triangle Park, North Carolina
27709 USA. Notices to Molnar shall be delivered to [CONFIDENTIAL TREATMENT
REQUESTED]**.
C. This Agreement, including all Schedules, constitutes the entire understanding
of the parties. This Agreement supersedes and terminates all prior
representations, warranties and agreements, written or oral, regarding the
subject matter of this Agreement. Any modification to this Agreement must be in
a writing signed by both parties.
D. All covenants and obligations of this Agreement shall survive the termination
of this Agreement.
E. If one or more of the provisions contained in this Agreement is held invalid,
illegal or unenforceable in any respect by any court of competent jurisdiction,
such holding will not impair the validity, legality, or enforceability of the
remaining provisions.
F. Failure or delay on the part of any party to exercise any right, remedy,
power or privilege hereunder will not operate as a waiver. Any waiver must be in
writing and signed by the party granting such waiver in order to be effective.
G. In the event that Red Hat is merged with or consolidated into any other
entity, or in the event that substantially all of the assets of Red Hat are sold
or otherwise transferred to any other entity, the provisions of this Agreement
will be binding upon, and inure to the benefit of, such other entity. Molnar
shall not subcontract or assign this Agreement to any third party without the
express written consent of Red Hat.
H. Nothing in this Agreement shall be construed to make the parties partners,
joint venturers, representatives, or agents of each other, nor shall either
party so hold itself out.
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**[CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
RULE 406 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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To show their assent to this Agreement, the duly authorized officers of the
parties have signed below.
RED HAT SOFTWARE, INC. ("Red Hat")
/s/ Robert F. Young
-----------------------------
Signature
ROBERT F. YOUNG Name
PRESIDENT Title
Date: August 18, 1998
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INGO MOLNAR ("Molnar")
/s/ Ingo Molnar
-----------------------------
Signature
INGO MOLNAR Name
Date: August 17, 1998
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**[CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
RULE 406 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.