International Distribution Agreement - ZixIt Corp. and AlphaOmega Soft Co. Ltd.
INTERNATIONAL
DISTRIBUTION AGREEMENT
WITH
ALPHAOMEGA SOFT CO., LTD.
("DISTRIBUTOR")
1 DEFINITIONS.
1.1 "Distributor" shall mean AlphaOmega Soft Co., Ltd., an affiliate of
Fujitsu, which is incorporated under the laws of Japan.
1.2 "Effective Date" shall mean the date set forth on the signature page to
this Agreement.
1.3 "Eligible Customer" shall mean a business enterprise headquartered in
Japan or that conducts business in Japan and that subscribes to use the ZixIt
Software/Service for the benefit of its employees and other agents that reside
in the Territory. An "Eligible Customer" includes a person who has obtained the
ZixMail(TM) software by downloading it from a Web site hosted by Distributor.
1.4 "Protected Information" shall mean any information pertaining to ZixIt
or its affiliated, or associated companies not generally known to the public,
including but not limited to, any information, data, or other material of ZixIt,
regardless of form, whether oral or written, relating to, referring to, or
evidencing any technology, processes, designs, patent applications, computer
programs, supplier or customer lists, or any other financial or business
information of ZixIt.
1.5 "Term" shall have the meaning given in Subsection 5.1.
1.6 "Territory" shall mean Japan.
1.7 "ZixIt" shall mean ZixIt Corporation, a Texas corporation.
1.8 "ZixIt Software/Service" shall mean the ZixIt ZixMail(TM) secure
messaging software and related services provided by ZixIt's worldwide signature
server.
2 APPOINTMENT; OBLIGATIONS OF DISTRIBUTOR.
2.1 Appointment. ZixIt appoints Distributor the exclusive distributor of
the ZixIt Software/Service in the Territory, subject to the pre-existing
distribution arrangements to distribute ZixIt's products as described in Exhibit
A. These pre-existing arrangements permit the other distributors to sell, market
and engage in other promotional activities (as defined below) for the
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ZixIt Software/Service throughout the world. ZixIt will notify Distributor if
ZixIt is working with these other distributors in relation to a prospect located
in the Territory. ZixIt and Distributor will negotiate the compensation payable
to Distributor, if any, arising from these situations. As the exclusive
distributor, Distributor shall have the right to locate Eligible Customers in
the Territory to use the ZixIt Software/Service and to provide support relating
to the ZixIt Software/Service in the Territory. Without the prior written
approval of ZixIt in each instance, Distributor's sales efforts and contacts and
support services shall be limited to the Territory. Distributor shall not
initiate or continue any sales efforts, contacts, or support efforts with
respect to the ZixIt Software/Service outside the Territory without the prior
written approval of ZixIt in each instance. Distributor agrees to use its best
efforts to locate Eligible Customers in the Territory to use the ZixIt
Software/Service. Distributor may establish relationships with dealers,
distributors, integrators, value-added resellers and other third parties
(collectively, "Third-Party Representatives") for the promotion, sale and/or
distribution of the ZixIt Software/Service on behalf of Distributor within the
Territory, provided: (i) Distributor registers the Third-Party Representative
with ZixIt in writing and in accordance with ZixIt's then-current registration
procedures, no less than 30 days in advance of establishing such a relationship;
(ii) Distributor is solely responsible for any compensation owed to Third-Party
Representatives; (iii) Distributor is solely responsible for and shall insure
the Third-Party Representative's compliance with the terms of this Agreement;
and (iv) Distributor is solely liable for, and shall indemnify ZixIt from any
liability associated with, the actions of its Third-Party Representatives
(including any breach of this Agreement). ZixIt shall not directly or indirectly
market the ZixIt Software/Service to prospects located in the Territory, except
that ZixIt and its other distributors shall be permitted to market, promote,
license, sell and/or distribute (collectively, "promotional activities")
licenses to use the ZixIt Software/Service to any prospect for the prospect's
use anywhere in the world so long as ZixIt's promotional activities are directed
toward the prospect's operations outside of the Territory.
2.2 Contracts with Eligible Customers. Distributor will contract directly
with the Eligible Customers to provide the ZixIt Software/Service. Distributor
will include in every license and services agreement with its customers the
terms and conditions that are specified by ZixIt from time-to-time. ZixIt will
provide to Distributor an English version of a sample form of license and
services agreement. Distributor may suggest changes to this English version for
the purposes of creating a suitable version for use in the Territory.
Distributor and ZixIt will then jointly develop a Japanese version of the form
of license and services agreement to be used by Distributor. Any further changes
to the form of license and services agreement are to be approved by ZixIt.
2.3 Provision of ZixMail Software/Service. ZixIt will provide the ZixIt
Software/Service to Distributor for the benefit of the Eligible Customers and
their users. The terms and conditions attached hereto as Exhibit B shall apply
to the provision of the ZixIt Software/Service by ZixIt to Distributor. ZixIt
may change the terms and conditions by providing Distributor a revised Exhibit B
at least five days prior to the effective date of the new terms and conditions.
The provision of the ZixIt Software/Service subsequent to such effective date
shall be governed by the revised terms and conditions.
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2.4 Billing; Collection of Accounts Receivable. Distributor shall be
responsible for billing to, and collecting from, its Eligible Customers for the
use of the ZixMail Software/Service. Distributor shall be obligated to pay ZixIt
the amounts owed pursuant to Subsection 3.1, regardless of whether or not
Distributor's customers actually pay Distributor.
2.5 Promotional Materials. ZixIt will provide a Japanese translation of the
ZixIt corporate brochure, the ZixMail product "white paper," and a "fact sheet"
discussing email vulnerability. All materials referencing the ZixIt
Software/Service distributed by Distributor shall include ZixIt's brand name and
product logos in a manner as prominent as Distributor's brand name and logos and
will include such proprietary, trademark, service mark, and patent protection
notices as ZixIt may require. All of Distributor's promotional materials,
including any English materials Distributor desires to translate, are to be
submitted to ZixIt for approval prior to use. Distributor shall never take any
action that is inconsistent with ZixIt's proprietary rights in ZixIt's brand
name and product logos. Distributor agrees to allow ZixIt to use Distributor's
logos and trademarks in ZixIt promotional activities with respect to the ZixIt
Software/Service. Distributor must use all trade names or marks used by ZixIt to
identify the ZixIt Software/Service, in accordance with ZixIt's most current
requirements, whenever identifying the ZixIt Software/Service, however, all such
marks and names shall remain the sole and exclusive property of ZixIt. ZixIt
shall have the right to identify Distributor as a distributor of the ZixIt
Software/Service in its advertising and promotional materials.
2.6 Governmental Approvals. Distributor shall be solely responsible for
securing, and paying for, any governmental approvals required in connection with
the licensing and use of the ZixIt Software/Service in the Territory, including
import and use licenses. ZixIt shall provide reasonable technical support to
Distributor in securing these governmental approvals.
2.7 Performance Review. At the later of (a) two and a half (2 1/2) years
following the Effective Date or (b) two (2) years following the delivery to
Distributor of a Japanese version of the ZixMail Software/Service (the
"Evaluation Date"), ZixIt will evaluate Distributor's performance under this
Agreement. If, as of the Evaluation Date, Distributor has not contracted with at
least 200,000 paying email addresses to use the ZixMail Software/Service, then
ZixIt may, in its sole discretion, convert Distributor's distribution
arrangement hereunder to a non-exclusive distribution arrangement.
3 FEES.
3.1 ZixMail Fees Payable to ZixIt. Distributor will pay to ZixIt a Services
Fee equal to the greater of (a) 35% of the license and services fees that
Distributor contracts with Eligible Customers to provide the ZixIt
Software/Service (calculated in U.S. $ by using the average daily conversion
rate for the applicable quarter) or (b) U.S. $8.40 on an annualized basis per
each email
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address of an Eligible Customer for which there are active ZixMail encryption
codes hosted by the ZixIt worldwide signature server; subject to the following:
For example:
o Assume Distributor charges $40 annually for the ZixMail(TM)
license. Distributor owes ZixIt an annual Services Fee of $14
(35% of $40).
o Assume Distributor charges $20 annually for the ZixMail(TM)
license. Distributor owes ZixIt an annual Services Fee of $8.40
(35% of $20 equals $7.00, which is below the minimum).
o During the Term, Distributor shall not be obligated to make any
payment of Services Fees unless the cumulative fees earned by ZixIt
exceed the cumulative payments made by Distributor.
Other than as provided in this Subsection 3.1 above, the Services Fees will
be paid by Distributor within 30 days following the end of the quarter in which
Distributor signed the contract for the ZixIt Software/Service.
3.2 Guaranteed Services Fees Payable to ZixIt. Distributor agrees to pay to
ZixIt a Guaranteed Services Fee (herein so called) of $1.2 Million, which is
paid as follows until the cumulative payments made by Distributor during the
Term equal $1.2 Million:
o a $200,000 guaranteed payment for the first year of the Term, of which
$100,000 is due and payable within 30 days of the Effective Date and
$100,000 is due and payable on April 1, 2002, plus
o a $400,000 guaranteed payment for the second year of the Term, which
is due and payable in four equal quarterly installments of $100,000,
with the first such installment due and payable on the first year
anniversary of the Effective Date, plus
o a $600,000 guaranteed payment for the third year of the Term, which is
due and payable in four equally quarterly installments of $150,000,
with the first such installment due and payable on the second year
anniversary of the Effective Date.
3.3 Distributor Service Fees. Distributor shall pay to ZixIt 10% of any
fees (net of taxes) contracted for by Distributor during the Term for support,
training, installation, maintenance or related services that Distributor
provides to Eligible Customers in connection with the licensing of ZixMail(TM).
These Distributor Services Fees will be paid by Distributor within 30 days
following the end of the quarter in which Distributor signed the contract for
the Distributor Service.
3.4 Taxes; Duties; Customs Fees. Distributor shall be responsible for
payment of any fees, sales, use, gross receipts, value added, property or other
taxes, duties, or customs fees that are levied on the sale, use, import, or
license of the ZixIt Software/Service to Eligible Customers and its users,
however designated, levied, or based by any authority (except any tax based on
ZixIt's net income). Distributor shall reimburse ZixIt for such taxes, duties,
or customs fees whenever ZixIt is
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required by applicable law to pay them. The parties agree that Distributor will
withhold a 10% (or the then-applicable amount) withholding tax, if required by
law.
3.5 Payment Information.
All payments to ZixIt hereunder shall be remitted to:
Bank of America, N.A.
Dallas, Texas 75205
Federal Wire Transfer:
Routing No. 111000025
For credit to: ZixMail.com, Inc.
Account No. 4779594348
ZixIt may change its payment instructions from time-to-time by notice given as
provided herein. All monies owed under this Agreement are stated, and shall be
paid, in U.S. dollars.
3.6 Audit Rights. ZixIt shall have the rights, upon at least five business
days prior written notice, to visit Distributor's facilities, during normal
business hours, and at its own expense, for the purpose of inspecting,
reviewing, photocopying, and determining the adequacy of Distributor's
procedures for maintaining the confidentiality of ZixIt's confidential
information and to otherwise audit, monitor and ensure compliance with the terms
of this Agreement. All such audits shall be reasonable in scope and duration.
ZixIt shall maintain the confidentiality of any information disclosed during an
audit that is identified as confidential by Distributor. If ZixIt's inspection
reveals an underpayment of fees payable to ZixIt under this Section 3 of more
than five percent, then Distributor shall pay for the costs and expenses of the
audit.
4 SERVICE; MAINTENANCE. ZixIt will provide English language on-line help
pages, accessible through www.zixit.com. Also, ZixIt will provide English
language technical support via email at support@zixit.com. Distributor will be
responsible for providing all other necessary technical support to its
customers, including any assistance they may require in installing ZixMail.
ZixIt will provide to Distributor modifications and enhancements to the ZixMail
software at such time as ZixIt makes them generally available.
5 TERM AND TERMINATION.
5.1 Term. The Term of this Agreement shall extend for three years from the
Effective Date, unless terminated earlier as permitted in this Section 5 below.
The Term may be renewed as mutually agreed to by the parties.
5.2 Termination By ZixIt. This Agreement may be terminated by ZixIt by
written notice to Distributor upon the happening of any of the following: (a) a
failure by Distributor to pay to ZixIt any sum due and owing within 15 days
after the date payment is due; (b) Distributor licenses or attempts to license
the ZixIt Software/Service outside the Territory without ZixIt's prior
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written approval; (c) Distributor violates any international treaties, trade
agreements, trade policies, export/import regulations or laws or governmental
decrees or requirements of the United States or Distributor is convicted of a
criminal offense in any court of competent jurisdiction; (d) insolvency or the
adjudication of bankruptcy or the petition for or consent to or becoming subject
to any relief under any bankruptcy, reorganization or moratorium statutes or
similar debtor relief laws by or of Distributor; (e) a breach by Distributor of
Section 7 of this Agreement; and (f) any material breach by Distributor of any
other provision of this Agreement that is not cured within 30 days after written
notice by ZixIt to Distributor specifying the alleged breach in reasonable
detail. Upon termination of this Agreement, Distributor shall cease endorsing,
promoting, marketing or otherwise distributing the ZixIt Software/Service and
shall immediately provide ZixIt with all originals and copies of the ZixIt
Software/Service, promotional materials, marketing literature, written
information, reports and ZixIt's confidential information. Distributor is not
entitled to a refund or set-off for any fees, charges or other monies paid to
ZixIt for any reason.
5.3 Termination By Distributor. This Agreement may be terminated by
Distributor by written notice to ZixIt upon the happening of any of the
following: (a) insolvency or adjudication of bankruptcy or the petition for or
consent to or becoming subject to any relief under any bankruptcy,
reorganization or moratorium statutes or similar debtor relief laws by or of
ZixIt; and (b) any material breach by ZixIt of this Agreement that is not cured
within 30 days after written notice by Distributor to ZixIt specifying the
alleged breach in reasonable detail.
5.4 Effect on Payments. Upon the expiration or termination of this
Agreement, Distributor will pay to ZixIt all fees (including the Guaranteed
Services Fees) earned by ZixIt (pursuant to Section 3) prior to the effective
date of the expiration or termination that have not yet been paid.
6 COMPLIANCE WITH LAWS. Distributor agrees that it will comply with all
applicable laws imposed by any foreign governmental agency or foreign state or
other political subdivision in the Territory. Distributor shall also comply with
the requirements of the U.S. Foreign Corrupt Practices Act, as outlined in
Exhibit C attached hereto.
7 CONFIDENTIALITY AND USE OF PROTECTED INFORMATION.
7.1 Nondisclosure. Distributor shall keep in strict confidence any and all
Protected Information. Furthermore, Distributor shall not directly or indirectly
disclose such Protected Information or make it available for any purpose to any
person or entity other than bona-fide employees of Distributor or its
wholly-owned subsidiaries who have a legitimate "need to know." Distributor
shall also require such personnel, by written agreements with such personnel, to
keep in confidence, not disclose or make available to any other person, or use
any such Protected Information. In no event shall any disclosure of Protected
Information be made to any competitor, actual or potential, of ZixIt in any
applications market.
7.2 Exceptions. Distributor shall have no obligation under Subsection 7.1
with respect to "Protected Information" that: (a) is or becomes part of the
public domain through no wrongful
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act of Distributor; (b) is or becomes known to Distributor (from a source other
than ZixIt) without the source violating any duty to ZixIt or any
confidentiality restriction on subsequent disclosure or use; or (c) is disclosed
pursuant to any judicial or governmental requirement or order; provided that,
Distributor gives ZixIt sufficient prior notice in order to contest such
requirement or order.
7.3 Use. Distributor shall not directly or indirectly use Protected
Information for its own benefit or the benefit of any third-party.
7.4 Copies; No Rights. Distributor shall reproduce Protected Information
only to the extent necessary for fulfilling its obligations under this
Agreement. All Protected Information, including copies thereof, shall remain the
property of ZixIt and shall be immediately returned to ZixIt upon the request of
ZixIt or upon any termination of this Agreement, whichever occurs first. Neither
this Agreement nor the disclosure or receipt of Protected Information shall
constitute or imply a grant of any rights, by license or otherwise, in any
Protected Information disclosed to Distributor by ZixIt.
8 GENERAL.
8.1 Assignment. Distributor shall not without the prior written consent of
ZixIt assign or attempt to assign this Agreement or any of its rights hereunder
or delegate any of its duties hereunder. For the purposes of this Subsection, a
change in controlling ownership of Distributor shall be deemed to be an
assignment hereunder. Any attempted assignment in violation of the preceding
sentences shall be void and ineffective for all purposes. ZixIt may at any time
assign all or any part of its right to receive payments from Distributor under
this Agreement to any person. ZixIt may also assign this Agreement to any ZixIt
affiliate. Subject to the foregoing, this Agreement shall be binding upon and
inure to the benefit of the parties and their successors or assigns. The term
"affiliate" as used in this Agreement with respect to an entity means an entity
controlling, controlled by, or under common control with such entity.
8.2 Patents; Marks. Distributor acknowledges and agrees to the validity of
all patents, trademarks, service marks, and applications therefore of ZixIt and
its affiliates. Distributor shall take no action to challenge the validity of
any patent, trademark, service mark, or applications therefor of ZixIt or its
affiliates, and ZixIt may terminate this Agreement upon notice to Distributor in
such event.
8.3 Relationship of Parties. The relationship between ZixIt and Distributor
hereunder is that of independent contractor. Nothing herein shall be construed
to constitute Distributor an agent, licensee, employee or consignee of ZixIt,
nor a partner or joint venturer with ZixIt. Neither party shall, in its
contractual relationships with third parties or otherwise, represent or imply
that any agency, licensee, employee or consignee relationship exists between the
parties or that either party is a partner or joint venturer of the other party.
ZixIt shall have no liability to Distributor's Eligible Customers or their users
in connection with their use of the ZixMail Software/Service.
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8.4 Force Majeure. Neither party shall be held responsible for any delay in
performance hereunder arising out of causes beyond that party's control and
without that party's fault or negligence. Such causes may include, by way of
example and not limitation, force majeure, fire, strikes, unavailability of
parts, embargoes, governmental requirements or actions of civil or military
authorities, acts of nature or of the public enemy, inability to secure material
or transportation facilities, or acts or omissions of carriers. Notwithstanding
the foregoing, each party reserves the right to terminate this Agreement under
Subsections 5.2 or 5.3, as applicable, if the other party fails to perform its
obligations hereunder due to an act of force majeure.
8.5 Limitation on Liability. IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE
OTHER FOR ANY INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES (INCLUDING
LOSS OF PROFITS) OF ANY NATURE ARISING UNDER THIS AGREEMENT, REGARDLESS OF
WHETHER LIABILITY ARISES IN CONTRACT, TORT, STRICT LIABILITY, BREACH OF
WARRANTY, INDEMNIFICATION, OR OTHERWISE. IN ADDITION TO THE FOREGOING, ZIXIT'S
AGGREGATE LIABILITY TO DISTRIBUTOR ARISING UNDER THIS AGREEMENT OR RELATING TO
THE PROVISION OF THE ZIXMAIL SOFTWARE/SERVICE TO DISTRIBUTOR UNDER ANY THEORY OF
RECOVERY SHALL NOT EXCEED THE AMOUNTS ACTUALLY PAID BY DISTRIBUTOR TO ZIXIT
UNDER THIS AGREEMENT WITHIN THE ONE-YEAR PERIOD PRECEDING THE ASSERTION OF A
CLAIM BY DISTRIBUTOR. OTHER THAN FOR THE PAYMENT OBLIGATIONS SET FORTH IN
SECTION 3 OR FOR THE MISAPPROPRIATION BY DISTRIBUTOR OF ZIXIT'S INTELLECTUAL
PROPERTY RIGHTS, DISTRIBUTOR'S AGGREGATE LIABILITY TO ZIXIT ARISING UNDER THIS
AGREEMENT UNDER ANY THEORY OF RECOVERY SHALL NOT EXCEED THE AMOUNTS ACTUALLY
PAID BY DISTRIBUTOR TO ZIXIT UNDER THIS AGREEMENT WITHIN THE ONE-YEAR PERIOD
PRECEDING THE ASSERTION OF A CLAIM BY ZIXIT.
8.6 Governing Law; Authority. This Agreement shall be governed, by the laws
of the state of Texas (without regard to its choice of law rules). The parties
expressly exclude the applicability of the Convention on Contracts for the
International Sale of Goods. Distributor agrees to submit to the personal
jurisdiction of any court of competent subject matter jurisdiction in the state
of Texas. If there is a foreign language translation of this Agreement, the
English version shall be the governing language.
8.7 Severability; Captions. If any provision of this Agreement is deemed to
be unlawful or unenforceable, such provision shall be deemed severable, and the
other provisions shall remain in full force and effect. The failure of either
party to exercise, in any respect, any right provided for herein shall not be
deemed a waiver of that right or any other right in this Agreement. If there is
a conflict between any part of this Agreement and any present or future law,
this Agreement shall be curtailed only to the extent necessary to bring it
within the requirements of that law. The headings herein are provided for ease
of reference only and are not to be used in interpreting the provisions of this
Agreement.
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8.8 Notices. All official notices, requests, demands, reports or other
communications pursuant to this Agreement shall be given by prepaid certified
mail, return receipt requested, or personally delivered to the respective
parties at the addresses set forth below:
If to: ZixIt Corporation If to: AlphaOmega Soft Co., Ltd.
2711 North Haskell Avenue 9F, NOA Bldg. 2-3-5 Azabudai
Suite 2850, LB 36 Minato-ku, Tokyo 106 0041
Dallas, Texas 75204-2911 Japan
USA
Attn: Legal Department Attn: Takamasa Sasaki, President
Fax: (214) 515-7385 Fax: +81-3-5575-2270
Contact for technical matters:
Ted Hull-Ryde
(214) 370-1028 (phone)
(214) 370-2074 (fax)
tryde@zixit.com
Contact for business matters:
Steve Gersten
(214) 370-2039 (phone)
(214) 370-2074 (fax)
sgersten@zixit.com
Such notices shall be deemed given when received by the other party.
8.9 Entire Agreement. This Agreement constitutes the complete understanding
between the parties with respect to the subject matter hereof and supersedes all
previous communications and representations or agreements, whether written or
oral, with respect to the subject matter hereof. No modification to this
Agreement will be binding upon the parties unless acknowledged in writing by
their duly authorized representatives.
8.10 Public Statements. Upon the execution of this Agreement, each party
shall issue a press release pertaining to this Agreement. Each party will give
the other party a reasonable opportunity to review and comment on its press
release prior to issuance.
8.11 Remedies. Distributor agrees that in the event of any threatened or
actual breach by Distributor of any of its obligations under Section 7, ZixIt
will suffer irreparable harm and that monetary damages will be inadequate to
compensate ZixIt for such breach. Accordingly, Distributor agrees that ZixIt
will, in addition to any other remedies available to it at law or in equity, be
entitled to preliminary and permanent injunctive relief to enforce any such
breach of the terms of this Agreement. Distributor further agrees that all of
its obligations under Section 7 shall survive and continue after termination of
this Agreement for any reason.
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8.12 Indemnification. Each party shall indemnify, defend and hold harmless
the other and its officers, employees, directors, shareholders, suppliers and
agents, from any losses, claims, demands, actions, causes of action, suits,
costs, attorney's fees, damages, expenses, compensation, penalties, liabilities
or obligations of any kind (collectively, "Losses") asserted by a third party
that arise out of or relate to the indemnifying party's: (i) failure to comply
with applicable law or (ii) failure to comply with the terms of this Agreement.
8.13 Further Assurances. Distributor, and the person signing on behalf of
Distributor, represents and warrants that it has the full legal capacity and
authority to enter into and perform the obligations of this Agreement without
any further approval, and that entering into this Agreement does not violate any
other obligation to which it may be subject.
8.14 Rules of Construction; Multiple Counterparts. This Agreement shall be
construed equally against the parties regardless of who is more responsible for
its preparation. This Agreement may be executed in multiple counterparts that,
together, shall be deemed a single binding agreement.
EXECUTED the date set forth below the parties signatures, to be effective
as of June 6, 2001 (the "Effective Date").
ZIXIT CORPORATION ALPHAOMEGA SOFT CO., LTD.,
a Fujitsu affiliate
By: /s/ Steve Gersten By: /s/ Takamasa Sasaki
----------------------------------- ---------------------------------
Name (print): Steve Gersten Name (print): Takamasa Sasaki
------------------------- -----------------------
Title: SVP of Sales & Marketing Title: President
-------------------------------- ------------------------------
Date: 6-28-2001 Date: June 27, 2001
--------------------------------- -------------------------------
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EXHIBIT A
PRE-EXISTING ARRANGEMENTS
ZixIt has already entered into the following distribution arrangements:
1. Entrust Technologies, Inc. (Nasdaq: ENTU), under which Entrust has the right
to incorporate ZixMail into Entrust's products, to provide users of Entrust's
digital certificates with the option of sending secure email through the
ZixMail.net service.
2. IT Factory, Inc., a leading developer of Lotus Notes applications, under
which IT Factory has the right to market ZixMail to Lotus Notes, Lotus Domino,
Microsoft Outlook and Microsoft Exchange Server users.
3. sNET Systems Corporation, the leading developer of distributed network
deception management solutions, under which sNET has the right to integrate the
use ZixMail into sNET's computer network security solutions.
4. Xenos (TSE: XNS), a leading provider of software that allows companies to
rapidly Web enable their customers' bills and statements, under which Xenos has
the right to market ZixMail.
5. Hummingbird Ltd. (Nasdaq: HUMC) (TSE:HUM), a world-leading enterprise
solutions company, under which Hummingbird has the right to offer ZixMail within
the Hummingbird Enterprise Information Portal (EIP).
6. Control Systems Inc., a provider of cost recovery products, under which
Control Systems has the right to market ZixMail to law firms and other
professional organizations as part of Control Systems' cost recovery product
suite.
A-1
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EXHIBIT B
GENERAL TERMS AND CONDITIONS
1. ZixMail Software/Service. So long as Distributor has made the payments it
is required to make under Section 3 of the Agreement, ZixIt agrees to provide
the ZixMail Service to an Eligible Customers' employees and other agents that
reside in the Territory.
2. Disclaimer. THE SOFTWARE AND ANY SUBSEQUENT RELEASE OF THE SOFTWARE IS
PROVIDED "AS IS," AND ALL WARRANTIES, WHETHER STATUTORY, EXPRESS OR IMPLIED,
INCLUDING ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR PARTICULAR PURPOSE,
COMPLIANCE OF DATA OUTPUT WITH APPLICABLE LAW, DESIGN, QUALITY, DURABILITY,
CONTINUOUS USE, PERFORMANCE OR ERROR-FREE OPERATION (EVEN IF CREATED BY THE
INTERNATIONAL SALE OF GOODS CONVENTION) ARE DISCLAIMED IN THEIR ENTIRETY.
3. Technical Info. ZixMail messages optionally routed through ZixIt's mail
relays, rather than through and Eligible Customer's email server, are limited
to 10 Megabytes compressed in size per message. See ZixIt's on-line help
pages, accessible through www.zixit.com, for technical information about the
ZixMail Service. Technical support is available via email at
support@zixit.com.
4. Acknowledgements. The ZixMail Software is being provided for no charge by
ZixIt's subsidiary ZixMail Technology Company, and the Services are being
provided in exchange for the specified fees by ZixIt's subsidiary
ZixMail.com, Inc. The ZixMail Software incorporates compression code by the
Info-ZIP group. There are no extra charges or costs due to the use of this
code, and the original compression sources are freely available from
CompuServe in the IBMPRO forum and by anonymous ftp from the Internet site
"ftp.uu.net/pub/archiving/zip." ZixIt will also, upon request, mail to
Distributor the full sources to the compression code that we use on a 3.5"
MSDOS-format diskette (or other appropriate medium) for the cost of mailing.
Send $10.00 to us at our address noted above, Attention: Legal Department,
and reference "request for Info-ZIP source code." Also, hash functions used
in the ZixMail Software are derived from the RSA Data Security, Inc. MD-5
Message-Digest Algorithm. The ZixMail Software incorporates spell checking
code from The Sentry Spelling-Checker Engine, copyright(c) 1999
WintertreeSoftware, Inc.
B-1
<PAGE> 13
EXHIBIT C
COMPLIANCE WITH LAWS
1. Compliance With U.S. Foreign Corrupt Practices Act. In connection with
performing its obligations under this Agreement, Distributor agrees that it will
not offer, pay, promise to pay, or authorize the payment of any money, or offer,
gift, promise to give, or authorize the giving of anything of value to:
(i) any foreign official, foreign political party or official thereof, or
any candidate for foreign political office for purposes of:
(a) influencing any act or decision of such official, political party
or official thereof, or candidate in his or its official capacity; or
(b) inducing such official, political party or official thereof, or
candidate to do or omit to do any act in violation of the lawful duty of such
official, party or official thereof, or candidate; or
(c) inducing such official, party or official thereof, or candidate to
use his or its influence with a foreign government or any instrumentality
thereof to affect or influence any act or decision of such government or
instrumentality.
(ii) any person, while knowing that all or a portion of such money or thing
of value will be offered, given, or promised, directly or indirectly, to any
foreign official, to any foreign political party or official thereof, or to any
candidate for foreign political office, for purposes of accomplishing the
prohibited acts in Subsection 1.(i) above.
2. Permitted Exceptions. The above does not prohibit Distributor from:
(i) making any facilitating or expediting payment to a foreign
official, political party, or party official, the purpose of which is to
expedite or to secure the performance of a routine governmental action by such
foreign official, political party, or party official;
(ii) making a payment, gift, offer, or promise of anything of value
that is lawful under the written laws and regulations of the country of the
foreign official, political party, party official or candidate to whom such
payment, gift, offer or promise was made; or
(iii) making a payment, gift, offer, or promise of anything of value
that is a reasonable and bona fide expenditure, such as travel and lodging
expenses, incurred by or on behalf of a foreign official, political party, party
official, or candidate and is directly related to (a) the promotion,
demonstration, or explanation of ZixIt' s or Distributor's products or services
or (b) the execution or performance of a contract with a foreign government or
agency thereof.
C-1