FORM SOFTWARE LICENSE [Licensor Friendly]

Transcription

1 FORM SOFTWARE LICENSE [Licensor Friendly] BRIEF DESCRIPTION This is a form master software agreement prepared from the perspective of a licensor looking to license an enterprise customer to install and use its software system. BODY OF DOCUMENT MASTER SOFTWARE LICENSE AGREEMENT THIS MASTER SOFTWARE LICENSE AGREEMENT (this Agreement ) is entered into as of,, ( Effective Date ) by and between ( Licensor ), a corporation having an address at, and ( Licensee ), a corporation having an address at. RECITALS WHEREAS, Licensor owns existing proprietary software and may, from time to time, develop additional proprietary software; and WHEREAS, Licensee desires to obtain, and Licensor is willing to grant, a license under certain of Licensor s proprietary software upon the terms and conditions of this Agreement. TERMS AND CONDITIONS OF AGREEMENT NOW THEREFORE, for and in consideration of the premises, representations, warranties, covenants and agreements set forth herein and for other good and valuable consideration, Licensor and Licensee hereby agree as follows: SECTION 1 -- DEFINITIONS As used herein, in addition to the terms defined elsewhere in this Agreement, the following terms shall have the meaning set forth below: 1.1. Change of Control means the acquisition of at least fifty percent (50%) of voting power of a Party, through any transaction including, any reorganization, merger, consolidation or tender offer, except where such Party s shareholders immediately prior to such transaction will, immediately thereafter, together hold at least fifty percent (50%) of the outstanding voting power of the surviving or acquiring entity. The foregoing notwithstanding, a Change of Control shall not include: (a) any initial public offering of Licensor; (b) any transfer of such voting power to an immediate family member of a stockholder of Licensor; or (c) any

2 Page 2 of 24 transfer of such voting power to any trust or similar entity established for the benefit of either (i) any stockholder of Licensor or (ii) an immediate family member of any stockholder of Licensor Confidential Information means all business or technical information of the disclosing Party that is not generally known to the public and that derives value from not being generally known, whether such information is disclosed to the receiving Party orally or in writing. Confidential Information may include any software, documentation, algorithm, device, compilation of information, method, technique or process. The Parties expressly acknowledge that this Agreement, the Software (in both source code and object code versions) and all Documentation provided to Licensee hereunder constitute Confidential Information of Licensor Designated Operating System(s) means the computer operating system and database software, if applicable, designated on the applicable Schedule Documentation means all operator and user manuals, education materials, guides, listings, specifications and other materials, including on-line information and materials, relating to the use of the Software delivered to Licensee hereunder Enhancement means any modification or addition to the Software that changes its utility, efficiency, functional capability, or application, but that does not constitute an Error Correction or New Module. Enhancements to the Software are included in the Maintenance and Support Services at no additional charge Error means any failure of the Software to conform to its Documentation in any material respect Error Correction means either a modification or addition that, when made or added to the Software, brings the Software into conformity with its Documentation in all material respects or a procedure or routine that, when observed in the regular operation of the Software, avoids the practical adverse effect of such nonconformity License Fee means the license fee specified in the applicable Schedule, payable by Licensee to Licensor upon 1.9. Maintenance and Support Services means any software maintenance and support services to be provided by Licensor with respect to the Software, as specified in the applicable Schedule Maintenance Fee has the meaning specified in Section 3.3(b) Maintenance Term means the period of time for which Licensor is obligated to provide Maintenance and Support Services for the applicable Software, including the initial Maintenance Term and any renewal Maintenance Terms, as described in Section 3.3(a) New Module means a new module related to the Software which contains business logic not offered or contained in the then-current version of the Software and is offered

3 Page 3 of 24 by Licensor as a separate option or feature and is priced separately. New Modules are not included in the Maintenance and Support Services and are subject to a separate charge Parties means Licensor and Licensee, collectively Party means Licensor or Licensee, individually Person means any individual, corporation, limited liability company, partnership, trust or other legal entity Professional Services means the installation, training, and/or programming services described in the applicable Schedule, which may be provided to Licensee by Licensor for implementation of the Software Qualified Representatives means the representatives of each Party that are identified in the applicable Schedule, and any other representative that a Party may designate by written notice to the other Party from time to time Release means a new version of the Software that includes Error Corrections and/or Enhancements Schedule means any addendum to this Agreement describing Software and any related Documentation, Professional Services and/or Maintenance and Support Services to be provided by Licensor to Licensee under this Agreement and any other terms and conditions specified therein, as may be agreed upon by the Parties from time to time during the term of this Agreement. Each Schedule to this Agreement shall be based on the template provided as Exhibit A hereto, but may include all or a subset of the sample of provisions specified therein or additional provisions not specified therein Service Level Penalty and Service Level Penalties are defined in Section 3.2(d) Site(s) means the physical location(s) of the departments and/or agencies of Licensee specified in an applicable Schedule, if any Software means the computer programs and data in machine-readable form provided by Licensor to Licensee hereunder, as listed on the applicable Schedule, together with any Error Corrections, Enhancements or Release thereto furnished by Licensor in connection with the Maintenance and Support Services or otherwise Source Code means the human readable form of software, including written comments and programmer documentation, flow charts, logic diagrams, pseudo code, notations or other supporting writings, regardless of the media on which it is stored, and intended for translation into an executable or intermediate form, or is intended for direct execution through interpretation.

4 Page 4 of Third Party means any Person other than Licensor or Licensee. SECTION 2 -- LICENSE OF SOFTWARE 2.1. Grant of License. In partial consideration for the License Fee, Licensor hereby grants to Licensee, and Licensee accepts from Licensor, subject to the terms and conditions of this Agreement, a worldwide, nonexclusive, nontransferable, site license to use the object code version of the Software and Documentation solely: (a) (b) (c) during the term of this Agreement; on the Designated Operating System(s), if any; at sites owned or maintained by Licensee; (d) for use on a single production server and a reasonable number of nonproduction servers; and (e) for Licensee's own internal business operations, and not for processing the data of any Third Party (whether on an outsourcing, service bureau, or other basis, except in connection with the performance of Licensee s regular business operations and not as a business itself), redistribution, remarketing or any other use Term of License. The term of this Agreement shall begin on the Effective Date and shall be effective for an initial period of three (3) years thereafter, unless earlier terminated in accordance with the provisions hereof. Upon expiration of the initial term, this Agreement may be renewed for consecutive three (3) year terms, provided that (a) this Agreement has not otherwise been terminated in accordance with the provisions hereof, and (b) neither Party has provided written notice to the other Party, at least sixty (60) days prior to expiration of the thencurrent term, of its desire to not this Agreement. Licensee's license to use any particular Software and Documentation shall begin on the date on which such Software and Documentation is first delivered to Licensee Additional Restrictions. Licensee s use of the Software and Documentation is subject to the following additional restrictions: (a) Licensee will not use the Software or Documentation for any purpose other than those expressly authorized under this Agreement. (b) Except for any sublicenses granted to end-users who access and use the Software for its intended purpose, Licensee will not otherwise sublicense, transfer, or assign its license rights in the Software or Documentation to any Third Party. (c) Licensee will not translate, reverse engineer, de-compile or disassemble the Software to develop any other computer program or for any other reason. However,

5 Page 5 of 24 Licensee may customize the Software without making any changes to the code of the delivered Software. (d) Licensee will not copy or duplicate by any means the Software, Documentation or any item included therein, without the prior written consent of Licensor, except to the extent reasonably necessary to maintain backup or historical Documentation or to test, implement, or use the Software. Licensee will cause all proprietary, confidential, copyright, trademark and/or patent notices, markings, or legends which appear on any item included in the Software and Documentation to be placed upon each such copy or duplication. The original and any copies of the Software and Documentation will at all times remain the sole property of Licensor. (e) Licensee will maintain records identifying the location and identity of the Designated Operating System(s), or any replacement system, and any copies of the Software (including any backup or archival copies), which records will be subject to inspection by Licensor during regular business hours upon reasonable advance notice. (f) Licensee may not modify the Software, whether through the services of its own employees or of independent contractors, without the prior consent of Licensor. (g) In no event will Licensee export any Software or Documentation or use any Software or Documentation outside the United States without the prior written consent of Licensor, which will not be unreasonably withheld, provided Licensee has provided evidence of its compliance herewith. Licensee agrees to comply with all export laws, restrictions, national security controls and regulations of the United States or other applicable foreign agency or authority, at Licensee s sole expense, and not to export or re-export, or allow the export or re-export, of the Software, Documentation or any of Licensor s Confidential Information or any copy or direct product thereof in violation of any such restrictions, laws or regulations, or in violation of the embargo provisions of the U.S. Export Administration Regulations (or any successor regulations or supplement), except in compliance with, and with all licenses and approvals required under, applicable export laws and regulations, including without limitation, those of the U.S. Department of Commerce Licensee Responsibility. Licensee is solely responsible for: (a) Obtaining any software or products required for use of the Software, including any operating system software, database software, or third-party applications software. (b) Licensee is responsible for conversion of any of Licensee s existing data files for use with the Software. Unless otherwise specified on an applicable Schedule, Licensor will not provide any data conversion services to Licensee Ownership of Software and Documentation. Error Corrections, Enhancements, Releases and any other programming provided by Licensor, regardless of its form or purpose,

6 Page 6 of 24 will be considered Software for purposes of this Agreement and will be subject to the rights and restrictions specified herein. Except as otherwise expressly set forth in this Agreement, Licensor retains all right, title and interest in and to all Software and Documentation, in all forms, and all copies and modifications of the thereof, including all worldwide rights to patents, copyrights, trademarks and trade secrets in or relating to the same. Licensee is not acquiring any right, title or interest of any nature whatsoever in any Software or Documentation except the license rights affirmatively stated herein. Unless otherwise agreed, Licensee agrees to return to Licensor or destroy, as requested by Licensor, superseded versions of any Software or Documentation. SECTION 3 -- SOFTWARE MAINTENANCE AND SUPPORT SERVICES 3.1. Description of Services. Provided that Licensee has timely paid the applicable Maintenance Fee, Licensor shall provide the following services (the Maintenance and Support Services ) with respect to the Software during the applicable Maintenance Term: (a) Error Corrections. Licensor will keep the Software performing in conformity with the Documentation in all material respects and will correct verifiable and reproducible Errors related to the Software when reported to Licensor in accordance with Licensor s Technical Support Procedures, which will be delivered to Licensee hereunder and which may be amended by Licensor from time to time. An Error Correction, when completed, may be provided in the form of a temporary fix, consisting of sufficient programming and instructions to implement the Error Correction. (b) Incidence Based Support. Licensor shall maintain appropriate communication means (collectively, a Help Desk ) for receiving support requests from Licensee regarding the use and operation of the Software and for addressing such requests in an efficient and timely manner. The Help Desk will initially be accessible by Licensee via telephone hot-line, or instant messaging. Licensor will also develop an extranet site through which Licensee can access the Help Desk. Licensor will use commercially reasonable efforts to make such extranet site available by,, but shall have no liability hereunder for failure to achieve such target date. Help Desk operators will respond to problems based on priority levels specified in Section 3.2. The Help Desk will automatically track support requests and deliver notices thereof to Licensor s subject matter experts. The Help Desk will also deliver submission receipts and completion confirmations to the Parties. Licensee will ensure that its appropriate technical support staff will make a good faith attempt to address service inquiries prior to contacting the Help Desk. To that end, Licensee s technical support staff should use all reasonable efforts to insure that a problem is not hardware related before contacting the Help Desk. A problem that is found to be hardware related shall not trigger any Service Level Penalties and may trigger Professional Services charges by Licensor once reviewed and acknowledged by Licensee. (c) New Releases. Licensor may, from time to time during the Maintenance term, issue to Licensee new Releases, containing Error Corrections and/or Enhancements. Licensor will provide Licensee with one (1) copy of each new Release for each copy of the applicable Software licensed to Licensee hereunder, without additional charge.

7 Page 7 of 24 Licensor will provide reasonable telephone assistance to help Licensee install and operate each new Release of the Software, as applicable. Because Releases are cumulative, a Release may be useful only if Licensee has obtained and installed all prior applicable Releases. (d) Compatibility Modifications. Licensor will provide to Licensee modifications to the Software necessary to maintain the Software current with updates and releases of the Designated Operating System and related utility software. (e) Performance Reports. Licensor shall provide monthly project performance reports to Licensee in a form agreed upon by the Parties for the first twelve (12) months of the Maintenance Term. At a minimum, the reports will list date, time, and nature of all support requests submitted by Licensee to the Help Desk, the reason for the incident or failure of performance for support request, and the resolution of any such incident or failure of performance. Licensee will in good faith determine whether monthly reports or quarterly reports are needed after the first twelve months of the Maintenance Term. Reports will be made available to Licensee no later than ten (10) working days after the close of a calendar month Service Levels. Licensor agrees that the Maintenance and Support Services will meet or exceed each of the following service levels (the Service Levels ) from the implementation date and thereafter during the Maintenance Term, subject to the limitations set forth in the Agreement: (a) Help Desk Schedule. Licensor will maintain the Help Desk with the following availability schedule: Hours 8 a.m. 5 p.m. EST every Mon-Fri, except state and federal holidays 5:01 p.m. 7:59 a.m. EST every Mon-Fri, Saturday, Sunday, state holiday and federal holiday Responsible for Handling All support requests Follow-up of Priority 1 support requests only (b) Help Desk Response. The Help Desk will respond to support requests from Licensee based on priority level, as follows:

8 Page 8 of 24 Description Priority 1 Complete System Failure These problems are of the most critical nature and of highest priority. These types of problems keep Licensee from operating its business, have a significant detrimental impact on Licensee s business; and are not solved by a work-around. Examples include total system failure and critical Software failure. Priority 2 Inoperable Business Function These problems have a negative impact upon a large business function. A temporary workaround is not a reasonable option for these types of problems. Examples include failure of appointment scheduling module or claim format error. Priority 3 - Business Function Limitation These problems are narrow functional limitations and situations that do not significantly impair Licensee s business activities, even though the impaired function is used daily. A temporary work-around is a reasonable option for these types of problems. Examples include charge posting errors, security problems, insurance processing, statement processing, month-end production and balancing. Licensor Responsibilities Response within 15 minutes of support request. Licensor will work continuously, 24 hours a day, until the issue is resolved. Account management is notified of issue within the first hour of confirming issue. Follow-up calls made every 2 hours by account management until issue is resolved (or as necessary and/or mutually agreed upon at the time of notification). Response within 1 hour of support request. Licensor will make its best effort to resolve these issues within 1 business day. Issue is escalated to account management within 4 hours. Account management will update Licensee on status once per day. Response within 1 business day of support request. Licensor will make its best effort to resolve these issues within 5 business days. Account management will update Licensee on status once every week.

9 Page 9 of 24 Priority 4 - Limited Occurrence Licensee Issue These problems affect specific functions within the Software that do not negatively impact daily operations. These problems occur infrequently and/or affect functions that are used intermittently. Examples include errors resulting from specific keystroke sequences, report errors, specific data errors/problems. Priority 5 - Minor System Issue These problems do not affect business operations. Examples of these issues include field change, navigational sequences and keystrokes and report format errors/problems. Response within 1 business day of support request. Licensor will make its best effort to resolve these issues within 15 business days. Response within 1 business day of support request. No guaranteed timeframe, incorporated into next software release version. (c) Service Level Failures. Within ten (10) days after receipt of a written notice from Licensee alleging Licensor s failure to provide the Maintenance and Support Services or Licensor s repeated failure to provide the Maintenance and Support Services in accordance with Priority 1 Service Levels as described above, Licensor shall (a) perform a root-cause analysis to identify the cause of such failure, (b) correct such failure, (c) provide Licensee with a written report detailing the cause of, and procedure for correcting, such failure, and (d) provide Licensee with reasonable assurance that such failure will no reoccur. (d) Service Level Penalties. In the event of failure by Licensor to meet the Service Levels set forth above, Licensee is solely entitled to the remedies set forth in the following table (each a Service Level Penalty and collectively the Service Level Penalties ), provided that, in no case, shall the Service Level Penalties for any given month exceed the value of one-twelfth (1/12 th ) of the annual Maintenance Fee (the Monthly Maintenance Fee ). Licensee has thirty (30) days following a Service Level violation to request the applicable credit. Failure to request a credit for a Service Level violation will waive the credit for that incident, but shall not constitute a waiver for any other Service Level Penalty. Violation A first violation of a Priority 1 or Priority 2 Service Level during a given month Two (2) to three (3) violations of Priority 1 or Priority 2 Service Levels during a given month Penalty percent ( %) credit of the Monthly Maintenance Fee on the next invoice percent ( %) total credit of the Monthly Maintenance Fee on the next invoice

10 Page 10 of 24 Four (4) to five (5) violations of Priority 1 or Priority 2 Service Levels during a given month Six (6) to nine (9) violations of Priority 1 or Priority 2 Service Levels during a given month Ten (10) or more violations of Priority 1 or Priority 2 Service Levels during a given month percent ( %) total credit of the Monthly Maintenance Fee on the next invoice percent ( %) total credit of the Monthly Maintenance Fee on the next invoice percent ( %) total credit of the Monthly Maintenance Fee on the next invoice (e) Service Level Penalty Waiver. Licensee hereby waives all of the abovedescribed Service Level Penalties for Service Level violations occurring during the three (3) months after implementation of the Software. (f) Service Level Changes. Upon request by either Party, but no more often than quarterly, Licensor and Licensee shall review the Service Levels during the Maintenance Term, and to the extent any Service Levels are no longer appropriate because of an increase, decrease, or change in the Maintenance and Support Services, the Parties shall in good faith agree to adjust the Service Levels. Both Parties must agree in writing on any change introduced to the Service Levels Terms and Conditions. In addition to any other terms and conditions specified in the applicable Schedule, the following terms and conditions shall apply to any Maintenance and Support Services provided by Licensor hereunder. (a) Maintenance Term. The initial Maintenance Term is specified in the applicable Schedule. Each Maintenance Term will automatically renew for subsequent renewal Maintenance Terms of one (1) year each, unless and until either Party gives the other Party at least thirty (30) days written notice of termination prior to the end of the then-current Maintenance Term. (b) Maintenance Fees. Licensee shall pay to Licensor an annual fee (the Maintenance Fee ) in exchange for Licensor s provision of the Maintenance and Support Services. The initial Maintenance Fee is specified in the applicable Schedule. Licensor reserves the right to increase the Maintenance Fee payable for any renewal Maintenance Term by giving Licensee prior written notice of the price increase at least sixty (60) days prior to the beginning of the renewal Maintenance Term. All Maintenance Fees are exclusive of travel and living expenses or fees and expenses for Professional Services, file conversion costs, optional products and services, directories, consulting services, shipping charges, and the costs of any recommended hardware, third-party software licenses, third-party software maintenance and support fees or operating system upgrades.

11 Page 11 of 24 (c) Payment of Maintenance Fees and Related Expenses. The applicable Maintenance Fee is due and payable in advance on an annual basis (pro rated if and as necessary during the initial Maintenance term). The first Maintenance Fee payment shall be due upon execution of the applicable Schedule or the first day of the initial Maintenance Term, whichever is later. Subsequent Maintenance Fee payments shall be due on the first day of the applicable renewal Maintenance Term. Any fees or expenses relating to Maintenance and Support Services that are excluded from the Maintenance Fee will be due and payable when and as the services are rendered or expenses incurred, as invoiced by Licensor. Licensor reserves the right to require prepayment or advance deposit of such fees and expenses. Any Maintenance Fee or other fees or expenses relating to Maintenance and Support Services not paid on the date on which they become due and payable will bear interest at the rate of one percent (1%) per month until paid in full. (d) Professional Service Fees. Fees for Professional Services associated with the installation, implementation, customization or modification of any kind related to the Software are not included in the Maintenance and Support Services. Initial rates for Professional Services to be provided by Licensor hereunder are specified in the applicable Schedule. Licensor reserves the right to increase the rates for Professional Services during any renewal Maintenance Term by giving Licensee prior written notice of the rate increase at least sixty (60) days prior to the beginning of the renewal Maintenance Term. (e) Change Control. Licensor shall inform Licensee in advance of all proposed changes ( Changes ) to systems and networks used and controlled by Licensor to provide any Maintenance and Support Services, whenever such Changes would materially alter the level of service, functionality, architecture, or technical environment of such systems or networks, or would have a material, adverse effect on such Maintenance and Support Services. No such Changes may be implemented without Licensee s prior approval (which shall not be unreasonably withheld) except as may be necessary on a temporary basis to maintain the continuity of any Maintenance and Support Services. Licensee shall respond with reasonable promptness to requests by Licensor for approval of such Changes. (f) Minimal Interruptions. Licensor shall (a) schedule any Maintenance and Support Services and any Changes so as not to unreasonably interrupt Licensee's business operations, (b) monitor the status of any Changes, and (c) document and provide to Licensee notification (which may be given orally, provided that such oral notice is confirmed in writing to Licensee within five (5) business days) of any Changes performed on a temporary basis to maintain the continuity of any Maintenance and Support Services, no later than the next business day after the Change is made. Licensor will advise Licensee at least thirty (30) days prior to implementing any scheduled system enhancements that will specifically affect Licensee s operating environment. Licensor shall provide Licensee with overview documentation and reference manual

12 Page 12 of 24 documentation at least ten (10) business days prior to implementing any such scheduled system enhancements. (g) Staff. Licensor shall take commercially reasonable actions to efficiently administer, manage, operate, and use the resources employed by Licensor to provide and perform any Maintenance and Support Services. Licensor shall at all times utilize sufficient staff of suitable training and skills to provide any Maintenance and Support Services. While at Licensee s locations, Licensor s personnel and agents shall (a) comply with reasonable requests from Licensee and standard rules and regulations of Licensee communicated to Licensor regarding personal and professional conduct (including the wearing of a particular uniform, identification badge, or adhering to Licensee regulations and general safety practices or procedures) generally applicable to such Licensee locations; and (b) otherwise conduct themselves in a businesslike manner. (h) Cooperation of Licensee. Licensee agrees to notify Licensor promptly following the discovery of any Error. Further, upon discovery of an Error, Licensee agrees, if requested by Licensor, to submit to Licensor (to the extent reasonably available) a listing of output and any other data that Licensor may reasonably require in order to reproduce the Error and the operating conditions under which the Error occurred or was discovered. (i) Termination of Services. Licensor s obligation, if any, to provide Maintenance and Support Services and Licensee s obligations, if any, to make payments of Maintenance Fees will automatically terminate with respect to any copies of Software that are no longer licensed for use under this Agreement. Licensee may elect to cancel the Maintenance and Support Services with respect to any particular Software by giving not less than thirty (30) days notice of such election prior to any renewal of the Maintenance Term. After cancellation for any reason, Licensee may subsequently reinstate Maintenance and Support Services upon notice to Licensor and payment of the then current Maintenance Fee plus all Maintenance Fee(s) that would have been due during the period of time when such services remained cancelled. (j) Most Favored Licensee. Licensor shall at all times provide Licensee with Maintenance and Support Services and Maintenance Fee pricing terms that are at least as favorable as those provided by Licensor to any other Third Party that licenses the Software upon substantially similar terms and conditions as specified in this Agreement Exclusions. The following services are expressly excluded from any Maintenance and Support Services to be provided by Licensor hereunder: (a) New Modules. Licensor shall have no obligation to provide any New Modules as part of any Maintenance and Support Services. Licensor may, from time to time, offer New Modules to Licensee for an additional charge. (b) Custom Enhancements. Except as may be specified on an applicable Schedule, Licensor shall have no obligation to provide any custom Enhancements as part

13 Page 13 of 24 of any Maintenance and Support Services. If Licensee requests custom Enhancements or other additional services pertaining to the Software (such as report formatting assistance), such services will be provided, if at all, in exchange for an additional fee and subject to any additional terms and conditions specified in the applicable Schedule. (c) Back Version Support. Licensor shall have no obligation to provide any Maintenance and Support Services for any version of the Software other than the most current Release and the Release immediately preceding the most current Release. If Licensee chooses not to install any Release, Licensor will, at Licensee's request, use its commercially reasonable efforts to maintain versions of the Software prior to the most current Release (and the Release immediately preceding the Current Release), subject to an additional charge and subject to availability of Licensor technical support staff. (d) Certain Problems and Errors. Maintenance and Support Services do not include, and Licensor shall not be responsible for addressing: (1) any problem resulting from the misuse, improper use, unauthorized alteration, or damage of the Software; (2) any problem resulting from programming other than the Software; (3) any problem resulting from the combination of the Software with such other programming or any equipment, to the extent such combination has not been approved by Licensor; or (4) Errors in any version of the Software other than the most current Release or the Release immediately preceding the most current Release, provided that Licensor will continue to support superseded Releases of the Software for a reasonable period of time, not to exceed ninety (90) days, sufficient for Licensee to implement the newest Release of the Software. Upon request by Licensee, Licensor will use commercially reasonable efforts to diagnose or attempt to correct any problem or Error described in this Section 3.4(d), subject to an additional charge. In addition, Licensee is responsible for procuring, installing, and maintaining all equipment, networks, telephone lines, communications interfaces, and other hardware necessary to operate the Software. Licensor will not be responsible for delays, problems or Errors caused by events or circumstances beyond its reasonable control. SECTION 4 -- LIMITED WARRANTIES AND REMEDIES 4.1. Limited Warranties. Provided that Licensee is not in material breach of any of its obligations under this Agreement, Licensor hereby warrants to Licensee as follows: (a) Material Conformity. The Software, as delivered under this Agreement, will conform in all material respects to the Documentation for the current version of the Software, provided that (1) all software which is not Software, all firmware, and all hardware products are operating in accordance with their respective specifications, and (2) Licensee is using the Software on the Designated Operating System(s) in a proper manner and in compliance with all operating instructions included in the Documentation. Licensee acknowledges that the operating platform configuration used in connection with the Software may affect its ability to perform as designed.

14 Page 14 of 24 (b) Response Time. The Software s response times for screen to screen transactions, other than for complex queries or printing functions, on a server with minimal clients logged on, shall be less than 5 seconds, provided that Licensee is using the Software on a network performing at a level adequate to meet this response time. If the opened screen automatically runs an imbedded query, the time spent running the imbedded query will be subtracted from the total response time to determine the Software s compliance with the foregoing warranty. (c) Database Integrity. The Software will not corrupt data stored in Licensee s corresponding database (referential integrity, consistency, and congruency). If corruption occurs that is not caused by the Software and discovered by either Party, the other Party will be notified and the Parties will work together to resolve the problem. Licensor will provide Licensee all information required to perform backup and restoration of both the database and the Software. (d) Scalability. For the first three (3) years of this Agreement, the Software will adequately handle all operational tasks associated with the maximum number of servers and by the maximum number of users specified on the applicable Schedule. The Software will remain compliant with the warranties specified in this Section 4.1 as increases in the number of servers or users occur. Licensor and Licensee agree to work together to implement appropriate solutions to accommodate additional capacity when a need for such increased capacity arises. Negotiations over cost and schedule of the transition to that increased capacity will be held at the request of either Party. (e) Development/Modifications. Any custom modification to or alteration of the Software performed by Licensor at the request of Licensee in accordance with this Agreement will conform to industry development standards, including the development of appropriate Documentation and training materials, as required. (f) Services. All services to be performed by Licensor under this Agreement, including any Maintenance and Support Services and Professional Services, will be performed in a competent and workmanlike manner by individuals of appropriate training and experience. (g) Ownership. Licensor owns the Software and the Documentation and has the full power and authority to grant to Licensee the license rights herein granted without the consent of any other Person Limited Warranties Not Applicable. Licensee will not have any rights with respect to any warranty specified in Section 4.1, and such warranty will be deemed not to apply to Licensee, to the extent that the failure of the Software to conform to the Documentation or to otherwise meet such warranty was caused by or results from any act or cause beyond the reasonable control of Licensor Disclaimer of Additional Warranties. THE WARRANTIES SPECIFIED IN SECTION 4.1 ARE EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES.

15 Page 15 of 24 LICENSOR EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, NON-INFRINGEMENT OR FITNESS FOR A PARTICULAR PURPOSE. EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, LICENSEE ASSUMES ALL RISKS ASSOCIATED WITH OPERATING THE SOFTWARE, AND LICENSOR DOES NOT WARRANT THAT THE SOFTWARE WILL BE ERROR FREE OR WILL MEET LICENSEE'S SPECIFIC NEEDS Remedies for Breach of Software Warranties. If any of the warranties specified in Sections 4.1(a)-4.1(e) are breached, then the following terms will apply: (a) Licensee will promptly notify Licensor of the breach and any associated details reasonably requested by Licensor in its attempt to remedy the problem. Licensee will cooperate with Licensor in re-creating the conditions that existed at the time the Software failed, if reasonably requested by Licensor. (b) Licensor will diligently and in good faith attempt to correct the reported defect by repairing or modifying the Software within a commercially reasonable period of time. (c) If any defective portion of the Software causes the entire Software to fail in its essential purpose, and if Licensor determines that it is unable to cure that defect by repairing or modifying the Software as provided in Section 4.4(b), then Licensee may elect as its sole and exclusive remedy to (1) terminate its right to use the Software and Documentation, (2) return all Software and Documentation to Licensor, and (3) receive a full refund of the fees actually paid by Licensee, less any portion of such fees attributable to any period of time during which the Software was in full compliance with the warranties provided herein Remedies for Breach of Service Warranty. If Licensor breaches its obligation to perform the services in accordance with the warranty set forth in Section 4.1(f), and Licensor fails to cure the breach within thirty (30) days after written notice of the breach is given by Licensee to Licensor, Licensee will have the right to terminate the applicable service, in which case Licensor must refund to Licensee within ten (10) days of such termination a pro rata portion of any fees pre-paid by Licensee for the applicable period of coverage Remedies for Breach of Ownership Warranty. If the warranty specified in Section 4.1(g) is breached because any of the Software or Documentation is deemed to infringe a Third Party s intellectual property rights, then Licensor will, at its option, either: (a) modify or replace such Software and/or Documentation with a comparable non-infringing substitute; (b) obtain a royalty-free license for Licensee to use such Software and/or Documentation; or (c) refund to Licensee an amount equal to the fees paid with respect to such Software and/or Documentation, less the portion of the fees attributable to the period over which Licensee actually used the Software and/or Documentation.

16 Page 16 of Remedies Exclusive. THE REMEDIES PROVIDED IN SECTION 4.4, SECTION 4.5 AND SECTION 4.6 ARE EXCLUSIVE AND WILL BE LICENSEE'S SOLE REMEDIES WITH RESPECT TO ANY CLAIM ARISING OUT OF OR RELATING TO ANY BREACH OF WARRANTY OR OTHER FAILURE OF THE SOFTWARE TO OPERATE AS INTENDED, WHETHER BASED IN CONTRACT, BREACH OF WARRANTY, TORT OR OTHERWISE. LICENSOR WILL NOT BE LIABLE TO LICENSEE FOR DAMAGES OF ANY NATURE WHATSOEVER, EXCEPT TO THE EXTENT OF THE REFUNDS SPECIFIED IN SECTION 4.4, SECTION 4.5 AND SECTION Limitation of Liability. IN NO EVENT WILL LICENSOR OR LICENSEE BE LIABLE TO THE OTHER PARTY OR ANY OTHER PERSON FOR ANY INDIRECT, INCIDENTAL, SPECIAL, PUNITIVE OR CONSEQUENTIAL DAMAGES, INCLUDING LOSS OF PROFITS, REVENUE, DATA, OR USE, INCURRED BY EITHER PARTY OR ANY OTHER PERSON, WHETHER IN AN ACTION IN CONTRACT, BREACH OF WARRANTY OR TORT, EVEN IF THE OTHER PARTY OR ANY OTHER PERSON HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. IN NO EVENT WILL EITHER PARTY S LIABILITY FOR DIRECT DAMAGES TO THE OTHER PARTY OR ANY OTHER PERSON EVER EXCEED ALL AMOUNTS PAID BY LICENSEE UNDER THIS AGREEMENT, REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT, NEGLIGENCE, TORT OR OTHERWISE. LICENSOR SHALL HAVE NO OBLIGATION TO INDEMNIFY LICENSEE AGAINST ANY THIRD PARTY INFRINGEMENT CLAIMS. SECTION 5 -- CONFIDENTIALITY 5.1. Limitations on Disclosure and Use of Confidential Information. Each Party, as the recipient of Confidential Information from the other Party, agrees that it will not disclose, provide or otherwise make available any Confidential Information of the disclosing Party, without the disclosing Party s prior written consent. In addition, each recipient Party agrees that it will not: (a) use the disclosing Party s Confidential Information for any purpose beyond the scope of this Agreement; (b) copy any part of such Confidential Information or disclose any part of such Confidential Information to any Person other than the recipient s employees who need the information to perform their duties; (c) authorize or permit any such employee to use or disclose any part of such Confidential Information in violation of this Agreement; (d) reverse engineer, de-compile or disassemble any of such Confidential Information nor use any of such Confidential Information for the purpose of reverse engineering, de-compiling or disassembling the Software; or

17 Page 17 of 24 (e) produce any product nor offer any service of any nature whatsoever based in whole or in part on such Confidential Information, nor cause or assist any other Person to do so Exclusions. The recipient Party's obligations under this Agreement will not apply to any portion of the disclosing Party s Confidential Information that: (a) at the time of disclosure to recipient, was in the public domain or subsequently becomes a part of the public domain through no breach of this Agreement; (b) recipient had in its possession at the time of disclosure by the disclosing Party, as established by written documentation in existence at that time, and that was not acquired directly or indirectly from the disclosing Party or with knowledge of confidentiality restrictions; or (c) recipient subsequently acquires by lawful means from a Third Party who is under no obligation of confidentiality or non-use owed to disclosing Party Disclosure Pursuant to Legal Process. If the recipient Party is legally compelled to disclose any portion of the disclosing Party s Confidential Information in connection with a lawsuit or similar proceeding or to any governmental agency, the recipient will give the disclosing Party prompt notice of that fact, including in its notice the legal basis for the required disclosure and the nature of the Confidential Information that must be disclosed. The recipient Party will cooperate fully with the disclosing Party in obtaining a protective order or other appropriate protection relating to the disclosure and subsequent use of such Confidential Information. The recipient Party will disclose only that portion of the disclosing Party s Confidential Information that is legally required to be disclosed Enforcement. The recipient Party acknowledges that the disclosing Party would have no adequate remedy at law should Recipient breach its obligations under this Section 5 and agrees that the disclosing Party will be entitled to enforce its rights under this Section 5 by obtaining appropriate equitable relief including a temporary restraining order and an injunction Return of Confidential Information. Upon request by the disclosing Party, the recipient Party will return any portion of the disclosing Party s Confidential Information that Recipient no longer has the right to use, including all copies of that Confidential Information, or, if so directed by the disclosing Party in writing, the recipient will destroy all copies of that Confidential Information and will certify to the disclosing Party in writing that all copies have been destroyed. SECTION 6 -- DISPUTE RESOLUTION 6.1. Mediation. Subject to Section 6.2, in the event of a dispute between the Parties concerning the interpretation or application of this Agreement or any other issues relevant hereto, both Parties will and do hereby agree to submit such dispute to non-binding mediation in

18 Page 18 of 24 compliance with the rules applicable to the mediation process, prior to instituting any legal action to resolve such dispute Exceptions. Nothing in this Section 6 will prevent either Party from (a) seeking interim or permanent injunctive relief or taking any other action in any court to enforce or protect its intellectual property rights, or (b) filing an action against the other Party in the courts having jurisdiction over it in order to enforce an arbitral award granted pursuant to a proceeding under this Section 6. SECTION 7 -- BREACH; TERMINATION 7.1. Termination of License. Licensee's license to use the Software and Documentation will be effective until terminated in accordance with the express provisions of this Section Termination by Licensor. Licensor may terminate this Agreement, any license granted hereunder or any Maintenance and Support Services provided hereunder upon written notice to Licensee should Licensee breach, in any material respect, any term of this Agreement and fail to cure that breach within thirty (30) days after receipt of written notice thereof from Licensor, except with respect to payment obligations, for which such cure period shall be sixty (60) days Termination by Licensee. Licensee may terminate this Agreement, any license granted hereunder or any Maintenance and Support Services provided hereunder at any time, for its convenience, upon thirty (30) days written notice to Licensor. In addition, Licensee may terminate this Agreement, any license granted hereunder or any Maintenance and Support Services provided hereunder upon written notice to Licensor if: (a) Licensor breaches, in any material respect, any term of this Agreement and fails to cure that breach within thirty (30) days after receipt of written notice of the breach from Licensee; (b) Licensor admits in writing its inability to pay its debts as they mature or makes an assignment for the benefit of its creditors; or (c) Proceedings in bankruptcy, or for reorganization of Licensor or for the readjustment of any of Licensor s debts, under the United States Bankruptcy Code, or under any other laws, whether state or federal, for the relief of debtors, now or hereafter existing, shall be commenced by Licensor, or shall be commenced against Licensor and shall not be discharged or terminated within sixty (60) days of their commencement Effect of Termination. Upon termination of this Agreement or any license granted hereunder, Licensee will discontinue the use of and will return to Licensor all copies of the applicable Software and related Documentation and will destroy, and document in writing such destruction of, any embodiments of these materials stored in or on a reusable electronic or similar medium, including memory, disk packs, tapes, and other peripheral devices. Termination

19 Page 19 of 24 will not relieve Licensee from its obligation to pay any and all fees that accrue prior to the date of termination Survival. The provisions of this Agreement that by their terms are meant to survive termination or expiration hereof, will survive and continue in full force and effect notwithstanding such a termination or expiration. SECTION 8 -- SOURCE CODE ESCROW 8.1. Deposit and Escrow Agreement. Unless otherwise stated in the applicable Schedule, Licensor agrees to deposit the Source Code of the applicable Software into legal escrow with the following agent (the Escrow Agent ) for the benefit of Licensee: Attn: Phone: Fax: Licensor shall make the initial escrow deposit no later than two (2) months following delivery of such Software to Licensee or execution of the applicable Schedule, which ever occurs later, provided that the Parties have entered into a mutually acceptable software escrow agreement. The Parties shall cooperate in good faith to expeditiously enter into such software escrow agreement. In the event of any conflict between the terms and conditions of such software escrow agreement and this Agreement, the terms and conditions of the software escrow agreement shall control. Licensor agrees to update any such escrowed Source Code as major additions and/or modifications to the applicable Software are implemented within Licensee s operational environment. Licensee will pay all costs and fees associated with such escrow service and all reasonable costs associated with the preparation and delivery of the Source Code to the Escrow Agent. Licensor will have the right to inspect the facility and approval over the procedures maintained by the Escrow Agent. Licensee and the Escrow Agent will be jointly and severally liable for securing the safety of the stored Source Code Release Conditions. Any software escrow agreement shall provide for the release of the Source Code of the applicable Software from escrow to Licensee only in the event that: (a) this Agreement is terminated pursuant to Section 7.3(b) or Section 7.3(c); or (b) following a Change of Control of Licensor, the new controlling entity elects not to renew this Agreement upon substantially the same terms and conditions for at least the next renewal term and Licensee pays to Licensor a fee in the amount of times ( x) the then-current annual Maintenance Fee due with respect to the applicable Software; or (c) Licensor has ceased its ongoing business operations, or has ceased the sale, licensing, maintenance or other support of the applicable Software and no successor of Licensor has undertaken the same Effect of Release. In the event that Source Code of any Software is released to Licensee pursuant to the terms of a software escrow agreement, Licensee shall have, and