Exhibit 10.11

 

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SAP BUSINESS ONE SOFTWARE

MARKETING AND DISTRIBUTION AGREEMENT

 

This Agreement is made effective this 15th day of November, 2004, by and between
SAP America, Inc., a Delaware corporation, with offices at 3999 West Chester
Pike, Newtown Square, Pennsylvania, U.S.A., 19073, (“SAP”), and
SoftBrands, Inc., a Minnesota corporation, with offices at Two Meridian
Crossing, Minneapolis, MN 55423 (“Reseller”).

 

RECITAL

 

WHEREAS, Reseller has represented to SAP that Reseller has significant and
valuable industry experience in small and medium enterprise U.S. market(s), a
good sales and marketing track record, financial stability, and a sound U.S.
business; and

 

WHEREAS, Reseller markets, licenses, and distributes software and provides
support and related services to software end users in such markets; and

 

WHEREAS, SAP and Reseller desire to successfully partner via this Agreement in
order to pervasively penetrate the small and medium enterprise U.S. market; and

 

WHEREAS, SAP and Reseller desire to enter into a marketing arrangement, whereby
Reseller will have the non-exclusive right to market, distribute, and support
SAP Business One software to small and medium sized businesses in the Territory
(as defined herein), all in accordance with this Agreement;

 

WHEREAS, SAP desires to grant, and Reseller desires to accept subject to the
terms and conditions of this Agreement, a license to market and sublicense the
Software and to provide support and Related Services in the Territory as part of
its SAP Business One Software Marketing and Distribution program;

 

NOW, THEREFORE, SAP and Reseller agree as follows:

 

1.                                       DEFINITIONS.

 

1.1                                 “Authorized SAP Partner” means an entity
authorized by SAP to resell the Software.

 

1.2                                 “Combination Use” means Use of the Software
in combination or conjunction with any of the following: (i) any software other
than the Software; (ii) any apparatus other than a Designated Unit; and/or
(iii) any activities of Reseller not licensed under this Agreement.

 

SAP CONFIDENTIAL

 

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1.3                                 “Correction Level” means a change in the
Software between Versions made generally available by SAP to licensees of the
Software [e.g., 3.01.01].

 

1.4                                 “Designated Unit” means each individual
computer in which the Software and the Third Party Database are installed.

 

1.5                                 “Documentation” means SAP’s standard
documentation as related to the Software, in any medium, which is delivered to
the Reseller Licensee, including SAP’s standard manuals, program listings, data
models, flow charts, logic diagrams, functional specifications, instructions,
and complete or partial copies of the foregoing.

 

1.6                                 “Export” and “Exportation” shall have the
meanings given them under the applicable export control statutes and regulations
administered by the relevant governmental agency.

 

1.7                                 “Maintenance” means the maintenance and
support services for the Software provided by a party pursuant to the terms and
conditions of Appendix B as may be amended from time to time in accordance with
Section 6.1.

 

1.8                                 “Joint Marketing Committee” has the meaning
given in the Solution Partner Agreement.

 

1.9                                 “Modification” means a change to the
Software that changes the source code.

 

1.10                           “Non-Productive Use” means Use of the Software
solely for Reseller’s testing, demonstration, backup, support or development
work in support of Reseller’s rights under this Agreement.

 

1.11                           “Productive Use” means Use of the Software solely
to operate Reseller Licensee’s or an authorized Reseller Subsidiary’s internal
information technology business operations.

 

1.12                           “Program Concepts” means the concepts,
techniques, ideas and know-how embodied and expressed in any computer programs
or modules included in the Software, including their structure, sequence and
organization.

 

1.13                           “Proprietary Information” means: (i) with respect
to SAP and SAP AG, the Software and Documentation and any complete or partial
copies thereof, the Program Concepts, the Third Party Database, any other third
party software licensed with or as part of the Software, benchmark results,
(ii) with respect to Reseller, the Reseller Software, Reseller Extension and any
third party software licensed with or as part of the Reseller Software and
benchmark results and (iii) any other information reasonably identifiable as
confidential and proprietary information of SAP, Reseller, their other
licensors, or Reseller Licensees excluding any part of the Proprietary
Information which: (a) was in the public domain before the recipient party’s
receipt of the Proprietary Information; (b) enters the public domain through no
act or omission of the recipient party; or (c) has been rightfully furnished to
the recipient party by a third party without restrictions on use or disclosure.

 

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1.14                           “Related Services” means physical installation,
implementation, training, customization, Maintenance and/or other services
related to the Software.

 

1.15                           “Release” means each issuance of the Software,
excluding third party software, identified by the numeral to the left of the
decimal point (e.g., 3.01).

 

1.16                           “Reseller Agent” is defined in Section 2.10.

 

1.17                           “Reseller Licensee” means the legal entity that
is a customer of Reseller or a Reseller Agent hereunder and has executed an SAP
End User License Agreement with SAP in accordance with the terms herein.

 

1.18                           “Reseller Software” means (i) the SoftBrands
Fourth Shift Edition for Business One in the current Version as of the date of
this Agreement, (ii) the DemandStream software in the current Version as of the
date of this Agreement, (iii) any releases, versions or correction levels of the
Reseller Software released during the term of the Agreement, and (iv) any
complete or partial copies of any of the foregoing.

 

1.19                           “Reseller Extension” means the Extension
developed by Reseller pursuant to the Solution Partner Agreement, as more fully
defined therein.

 

1.20                           “SAP End User License Agreement” means the
license agreement between SAP AG or one of its affiliates, including SAP, and a
licensee (including without limitation a Reseller Licensee) under which rights
have been granted to such licensee to Use the Software, Documentation and Third
Party Database.

 

1.21                           “SAP AG” means SAP Aktiengesellschaft, the
licensor of the SAP Proprietary Information to SAP.

 

1.22                           “SAP Partner Program” means the SAP Partner
Program set out in Appendix D to the Solution Partner Agreement..

 

1.23                           “Software” means: (i) the SAP Business One
Software in the Version as of the date of this Agreement which Reseller is
authorized to distribute in accordance with this Agreement, (ii) any Releases,
Versions, or Correction Levels of the Software released during the term of this
Agreement, and (iii) any complete or partial copies of any of the foregoing.

 

1.24                           “SoftBrands Stack” means the Reseller Software,
Reseller Extension and the Software licensed to an End User customer as an
integrated solution.

 

1.25                           “Solution Partner Agreement” means that certain
SAP Business One Solution Partner Agreement by and between SAP and Reseller
dated June 15, 2004.

 

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1.26                           “Territory” means the United States of America.

 

1.27                           “Third Party Database” means a version of third
party, proprietary database software licensed through SAP and/or Reseller to
Reseller Licensees that is required for Use with the Software limited for Use
solely in support of the Software.

 

1.28                           “Use” means to load, access, execute, employ,
utilize, store, or display the Software.

 

1.29                           “Users” means those user types identified of
defined in SAP End User License Agreement (s) or Appendices.

 

1.30                           “Version” means each issuance of each Release of
the Software, excluding third party software, identified by the numeral to the
right of the decimal point (e.g., 3.01).

 

1.31                           “Yearly Business Review”  means the process by
which Reseller will provide SAP information which SAP reasonably requires to
determine which additional products and delivery vehicles, if any, Reseller will
be permitted to offer in the Territory.  Such information may include financial
information, future business plans, sales training programs attended, support
infrastructure training and capabilities and any other information required by
SAP.

 

2.                                       AUTHORIZATION AND COMMITMENT OF
RESOURCES.

 

2.1(a)  Authorization. Subject to the terms of this Agreement, including the
terms and conditions of the SAP Partner Program and SAP’s right from SAP AG and
other licensors to provide such authorization, SAP hereby grants to Reseller,
and Reseller hereby accepts, for the period commencing on the date specified in
the first paragraph of this Agreement and ending December 31, 2006, a
non-exclusive, non-transferable, non-sublicenseable license to:

 

(i)  market and distribute the Software and Documentation, either as part of the
Reseller Stack or on a stand-alone basis, subject, in either case to the terms
of this Agreement, and provide Related Services to prospective and current
Reseller Licensees in the Territory;

 

(ii) Use the Software for testing with such Reseller Licensee’s systems and for
the demonstration to prospective Reseller Licensees and for similar
Non-Productive Uses at Reseller’s place of business, at a prospective Reseller
Licensee’s premises, or at appropriate off-site locations located in the
Territory.  Such Non-Productive Use shall be subject to the terms and conditions
of the Software End-User Non-Productive Use License previously executed between
the parties.

 

2.1(b) Scope

 

(i)  The rights granted to Reseller under this paragraph 2.1 expressly do not
extend to Reseller with respect to Reseller Licensees and prospective Reseller
Licensees which are (1) U.S. affiliates with a parent organization outside the
Territory, except upon advance notice and

 

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coordination with SMB channel management or (2) require Use of the Software
outside of the United States, except as provided in §2.1(b)(ii) below.

 

(ii)  Notwithstanding anything to the contrary in this Agreement, Reseller will
be allowed to distribute the Software outside the Territory to multinational
customers on the condition that (a) Reseller is in compliance with the terms of
this Agreement, (b) the applicable multinational customer meets the customer
requirements of this Agreement (other than the Territory requirements), and
(c) the management of the SAP Affiliate in whose country the Software will be
distributed gives written approval to such distribution.

 

(iii) The rights granted to Reseller under this paragraph 2.1(a) further
expressly exclude any entity which Uses or intends to Use the Software and
Documentation to train its employees and/or consultants to provide
implementation, testing and/or consultancy services to third parties, or Uses or
intends to Use the Software and Documentation to perform software integration,
testing or development services other than to support its Productive Use. The
grants in this Article 2 are non-transferable without the prior written consent
of SAP except as specifically identified in §2.10 or in connection with a
permitted assignment as forth in §16.1.

 

2.2                                 RESELLER LICENSES.

 

2.2(a)  Other than the terms of the SAP End User License Agreement, Reseller
controls the terms on which it does business with its Reseller Licensees,
including any commitments on behalf of Reseller relating to the Software (e.g.
specifying future discounts or prices), and is responsible for compliance with,
and enforcement of, its agreements with such Reseller Licensees.  Reseller
agrees that, as a part of its obligations to SAP, Reseller shall not impose any
liabilities on SAP or agree to any provisions with a Reseller Licensee that are
inconsistent with SAP’s intellectual, industrial and other property rights. 
Except as specifically provided in Section 2.10(a), in no event shall a Reseller
Licensee be granted a right to assign, sublicense or distribute the Software to
Reseller Licensees, or other persons or entities.  Reseller will reasonably
cooperate and assist SAP in enforcing any of SAP’s rights against Reseller
Licensees.  Reseller acknowledges and agrees that such enforcement by SAP may
include, without limitation, termination of the SAP End-User License
Agreement(s) between SAP and a Reseller Licensee against which SAP has
undertaken enforcement action.  SAP shall have no liability whatsoever to
Reseller in the event of such termination.  Reseller acknowledges and agrees
that in the event of such terminations, its other contracts with such terminated
Reseller Licensees may be adversely affected, and Reseller shall take
appropriate steps to address this potential issue in its other contracts. 
Reseller will notify SAP promptly of any unauthorized use of the Software or
other SAP Proprietary Information by Reseller Licensees that comes to Reseller’s
attention. SAP, SAP AG and its licensors shall have the sole right and
discretion to bring enforcement proceedings involving the Software, provided,
however, that it may agree with Reseller to jointly bring and/or pursue such
proceedings.

 

2.2(B)  ALL LICENSES OF THE SOFTWARE, THIRD PARTY DATABASE AND DOCUMENTATION
DISTRIBUTED BY RESELLER SHALL BE CONSISTENT IN ALL RESPECTS WITH THE SAP END
USER LICENSE AGREEMENT

 

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provided by SAP to Reseller Licensee.  Reseller shall not deliver any Software
or other SAP Proprietary Information to Reseller Licensee until SAP and Reseller
Licensee execute the SAP End-User License Agreement for the Software, Third
Party Database and Documentation.  Any unauthorized change in the SAP End User
License Agreement by Reseller is a default in the performance of a material
obligation of this Agreement and grounds for termination under
Section 15.2(b) of this Agreement.  SAP may amend the SAP End User License
Agreement from time to time without prior notice from SAP, and such amended
documents may be provided by SAP for use by Reseller in distributing the
Software hereunder.  The current version of the SAP End User License Agreement
is attached as Appendix A.

 

2.3                                 Non-Exclusivity.  SAP and Reseller agree
that the rights granted to Reseller hereunder are non-exclusive.  SAP AG and/or
SAP and/or its or their affiliates may itself or may authorize others to offer
the Software, Related Services and/or other services related to the Software in
the Territory as it/they may deem appropriate in its/their sole discretion.

 

2.4                                 SAP Retained Rights.

 

2.4(a)  The licensing of the Software is further subject to any additional
restrictions contained in the then current SAP Business One U.S. List of Prices
and Conditions.  SAP reserves the right to alter, change, amend or otherwise
modify in any manner whatsoever the SAP Business One U.S. List of Prices and
Conditions in accordance with Section 7.2 of this Agreement upon ninety (90)
days prior written notice..  Reseller acknowledges and agrees that the SAP
Partner Program is an integral part of the relationship between the parties.

 

2.4(b) SAP retains the right to enter and market in any lines of business by
itself or with or through third parties in the Territory, including without
limitation lines of business that involve or relate to the Software and Related
Services so long as no Reseller Proprietary Information is used by SAP.  SAP
shall not be required to pay Reseller any fees or royalties associated with
transactions between SAP and any entities pursuant to SAP’s retained rights.

 

2.5                                 Services. Reseller shall ensure that all
contracts for services provided by Reseller to Reseller Licensees are entered
into and executed in the name of and by the party performing such services and
that SAP and SAP AG shall have no liability under such contracts or for such
services.

 

2.6                                 Efforts. Reseller shall use commercially
reasonable efforts to market and license the Software and market and provide
Maintenance.  RESELLER DOES SO AT ITS OWN RISK AND FOR ITS OWN ACCOUNT EXCEPT AS
OTHERWISE SET FORTH HEREIN.

 

2.7                                 End-User Transition.

 

2.7(a)  Subject to the terms in Appendix B, Reseller acknowledges and agrees
that Reseller Licensees may, from time to time, choose to terminate their
relationship(s) with Reseller and receive Related Services from SAP, SAP
affiliates, or other authorized distributors of SAP

 

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software. In the event a Reseller Licensee ceases to be a customer of Reseller,
for any reason, Reseller shall cooperate with SAP and such Reseller Licensee in
order to ensure the smooth transition of the business relationship from Reseller
to another party selected by Reseller Licensee or SAP.  Reseller acknowledges
and agrees that SAP shall have no liability in this regard.

 

2.7(b)  In the event any SAP licensee divests an entity and such entity does not
have Use or access rights to the Software pursuant to an SAP End User License
Agreement, and provided that such entity does not fit within the requirements of
Section 2.1, SAP in its sole discretion shall determine whether the Reseller
shall be entitled to license to such divested entity in accordance with this
Agreement.

 

2.7(c)  In the event a Reseller Licensee is acquired by or otherwise merged with
or into an existing licensee of SAP software, and provided that such entity does
not fit within the requirements of Section 2.1, Reseller shall no longer be
entitled to license the Software to that entity without the prior express
written approval of SAP.

 

2.8                                 Reputation.  Reseller agrees not to act in
any manner that negatively affects or is likely to negatively affect the
reputation of SAP, its software (including the Software), services, or SAP’s
trademarks.  SAP agrees not to act in any manner that negatively affects or is
likely to negatively affect the reputation of Reseller, its software (including
the Reseller Stack), services, or Reseller’s trademarks.

 

2.9                                 Limitation and Restrictions.  Except as
expressly provided herein, Reseller shall not, and shall not license, authorize,
or permit any Reseller Licensee or any other third party to:

 

(i)                                     modify, create any derivative work of,
include in any other software or make any copies of the Software or
Documentation or any portion thereof except that Reseller shall be permitted to
use and copy the Documentation to create additional technical and/or user
documentation explaining use and operation of the Reseller Stack that may be
delivered to Reseller Licensees together with the Documentation.

 

(ii)                                  create any Modifications or, except as
specifically authorized by SAP in writing or the SAP Partner Program Agreement,
or extensions to the Software;

 

(iii)                               market, distribute, sell, or deploy the
Software or Documentation or any copies thereof packaged, bundled, incorporated
in, or embedded with or into any product or service not provided by SAP without
SAP’s prior express consent;

 

(iv)                              disassemble, or decompile, nor recreate or
attempt to recreate, by reverse engineering or otherwise, the source code from
the object code of the Software or use it to create a derivative work except as
previously authorized or directed by SAP for the purposes of correcting errors
in the Software or performing warranty, Maintenance, and other support services;
or

 

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(v)                                 Use the Software for timesharing, service
bureau or service provider purposes, except as may be specifically authorized by
SAP in writing.

 

The restrictions in this Agreement, including this Section 2.9, shall not affect
any rights or licenses granted to Reseller by SAP in any other agreement between
the parties.

 

2.10                           Authorization of Reseller Agents

 

2.10 (a)  Subject to this Agreement, including without limitation all
restrictions on use and disclosure of the Software and other SAP Proprietary
Information, Reseller may authorize third parties who are Authorized SAP
Partners (“Reseller Agents”) to exercise the rights of Reseller under
Section 2.1(a).  Prior to such authorization, Reseller shall either confirm or
facilitate the qualification of each such Reseller Agent prospect in accordance
with Appendix D.  In addition to all requirements under Appendix D, and prior
both to authorizing any entity as a Reseller Agent hereunder and disclosing any
SAP Proprietary Information to such entity, Reseller shall attach Appendix E as
an addendum to its operative agreement(s).  Reseller shall identify each
certified Reseller Agent to SAP, and provide information reasonable required by
SAP regarding each such certified Reseller Agent, unless otherwise provided
during the certification process.

 

2.10(b)  Reseller shall indemnify SAP, and hold SAP harmless from and against,
any and all liability, loss, claim, cost or expense (including reasonable
attorney’s fees) resulting from any claim against SAP by any third party arising
out of any action by a Reseller Agent in marketing or distributing the
SoftBrands Stack, excluding claims related to warranty, intellectual property
indemnification or other claims pursuant to the SAP End User License Agreement
the Software or the Reseller Agent’s direct, contractual relationship with SAP..

 

2.10(c)  Except as set forth herein, including without limitation in Appendix E,
Reseller controls the terms on which it does business with its Reseller Agents
and is responsible for its own account for compliance with, and enforcement of,
its agreements with such Reseller Agents.  SAP ASSUMES NO OBLIGATIONS WHATSOEVER
TO SUCH RESELLER AGENTS PURSUANT TO ANY AGREEMENTS BETWEEN RESELLER AND SUCH
RESELLER AGENTS.  Reseller agrees that, with respect to the Reseller Agents,
Reseller shall not impose any contractual liabilities on SAP other than those
set forth in Appendix E.  Reseller shall not grant to any Reseller Agent a right
to assign, sublicense or distribute the Software to other Reseller Agents,
Reseller Licensees, persons or entities except as may be expressly provided for
herein.  Reseller shall undertake any and all commitments with Reseller Agents
on its own behalf and for its own account, and SAP shall have no liability
therefor.

 

2.10(d)  SAP reserves the right to review Reseller’s certification of
prospective Reseller Agents and Reseller shall, at the written discretion of
SAP, revoke immediately any such certification that has not complied with or
otherwise satisfied the certification guidelines set forth herein.  Further,
Reseller shall, upon becoming aware of any material breach by any Reseller

 

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Agent of the terms and conditions set forth herein, inform SAP of the same and,
at SAP’s direction, revoke such Reseller Agent’s certification.

 

2.10(e)  Subject to this Agreement, Reseller may authorize third parties to act
as referral parties in connection with the marketing of the software (“Referral
Party”).  Referral Party may identify potential end user transaction leads and
provide such information to Reseller on such financial terms as Referral Party
and SoftBrands may agree.  Referral Party shall, for purposes of the activities
permitted hereunder, at all times be the agent of SoftBrands, under its
direction and control, and SAP shall have no liability for any statement, action
or obligation of Referral Party.  Referral Party shall not create or impose any
obligation of any kind on SAP.

 

3.                                       ENCUMBRANCE, OWNERSHIP, COPYRIGHT
NOTICES, TRANSLATION AND EXPORTATION.

 

3.1                                 Encumbrance. In no event shall Reseller
engage in the lease, transfer, rental, loan or any other encumbrance of the
Software by any means including by operation of law.

 

3.2                                 No Translation. Reseller shall not translate
any portion of the SAP Proprietary Information, including Documentation, into
any other language.

 

3.3                                 No Exportation. Regardless of any disclosure
made by Reseller to SAP of an ultimate destination of the Software,
Documentation, Third-Party Database, and other provided SAP Proprietary
Information, Reseller acknowledges that SAP’s Software, Documentation, and
Proprietary Information are being released or transferred to Reseller in the
United States and are therefore subject to the U.S. export control laws. 
Reseller shall not Export nor knowingly permit the Exportation of the Software
from the United States of America to any destination without the express prior
written authorization of SAP.  Reseller agrees that it will not submit the
Software to any government agency for licensing consideration or other
regulatory approval without the prior written consent of SAP.  Failure to abide
by this provision is a material breach of this Agreement.

 

4.                                       MARKETING.

 

4.1                                 Joint Marketing Committee As described in
the Solution Partner Agreement, the parties shall establish a Joint Marketing
Committee.  The Joint Marketing committee shall cooperate to mutually agree upon
marketing strategy for the Software as part of the Reseller Stack.

 

4.2                                 Premises and Personnel. As determined by the
Joint Marketing Committee, Reseller shall maintain an appropriate organization
in the Territory dedicated to the performance of Reseller’s obligations
hereunder with competent sales, marketing implementation and software support
capabilities.  Reseller agrees to employ qualified consultants and other
personnel as needed to fulfill its obligations hereunder and shall provide
appropriate training for its employees.

 

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4.3                                 Business Opportunity Management. The Joint
Marketing Committee shall agree upon the manner in which Reseller shall use and
maintain customer leads in the sales opportunity management system maintained by
SAP.

 

4.4                                 Responsibilities. Reseller shall be solely
responsible for the collection of payments, demonstration, installation,
implementation, training and support for the Software, and Reseller’s
obligations under Maintenance at the location of any of its Reseller Licensees. 
Reseller shall not knowingly distribute the Software to a prospective Reseller
Licensee who does not intend to use the Software and Documentation to run its
internal business operations or who intends to Use the Software or Documentation
in any manner in contravention of this Agreement or the SAP End User License
Agreement.  Reseller will: (i) provide instruction to its Reseller Licensees
regarding the Use and installation of the Software; (ii) use trained technicians
experienced in the computing industry and familiar with the Software to provide
technical support and assistance; and (iii) provide answers to current and
prospective Reseller Licensee questions and problems regarding the installation
and Use of the Software, all as required under its obligations for Maintenance
described in Appendix B.

 

4.5                                 Accountability. RESELLER SHALL BE
RESPONSIBLE FOR ACCURATELY AND COMPLETELY REPRESENTING THE SOFTWARE AND ITS
SERVICES IN ACCORDANCE WITH THE DOCUMENTATION OR OTHER SAP OFFICIALLY SANCTIONED
MATERIALS. RESELLER SHALL ASSUME ALL FINANCIAL AND LEGAL LIABILITY FOR THE
QUALITY, RELIABILITY, AND ACCURACY OF ALL REPRESENTATIONS MADE BY RESELLER, ITS
EMPLOYEES, AGENTS, AND CONSULTANTS REGARDING THE SOFTWARE, WHETHER ORAL OR
WRITTEN, BEYOND WHAT IS CONTAINED IN THE DOCUMENTATION AND OTHER SAP OFFICIALLY
SANCTIONED MATERIALS, AND SHALL ASSUME PRIMARY RESPONSIBILITY FOR ALL
COMMUNICATIONS ASSOCIATED WITH ANY CLAIMS, PROBLEMS, OR OTHER COMPLAINTS AS TO
QUALITY, FUNCTION, PURPOSE, AND COMPATIBILITY IN ACCORDANCE WITH THE
DOCUMENTATION WHENEVER THE SOFTWARE IS REFERENCED, DEMONSTRATED OR ADVERTISED.
Reseller shall give SAP, SAP AG and its licensors appropriate credit for the
ownership of the Software at any presentation of the Software.

 

4.6                                 PERFORMANCE TARGETS.

 

4.6(a)                   Performance Targets.  Reseller shall meet the sales and
other performance targets set forth in the SAP Partner Program or as otherwise
mutually agreed upon by the parties in writing from time to time.

 

4.6(B)                  SALES CAPACITY. RESELLER SHALL CREATE AND MAINTAIN A
SALES CAPACITY AT EACH LOCATION WITHIN THE TERRITORY, WHICH IS COMPRISED OF
SALES, PRE-SALES, SUPPORT AND ADMINISTRATIVE PERSONNEL AND EQUIPMENT, AT THE
RESELLER’S OWN EXPENSE, REQUIRED TO MEET ITS SALES TARGETS, CUSTOMER
SATISFACTION TARGETS, ANY OTHER PERFORMANCE TARGETS ESTABLISHED AS PROVIDED
HEREUNDER, AND OTHERWISE PERFORM ITS OBLIGATIONS HEREUNDER.

 

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4.6(c)                   Customer Satisfaction Targets.  Reseller shall obtain
and maintain customer satisfaction ratings, as set forth in the SAP Partner
Program or as mutually agreed upon by the parties in writing from time to time
(“Customer Satisfaction Target”).  Customer satisfaction shall be measured by
SAP in substantially the same manner as SAP measures customer satisfaction for
its directly licensed customers.  In the event Reseller does not provide SAP
accurate, complete and timely information required to complete customer
satisfaction surveys, Reseller shall be deemed to have received an
unsatisfactory rating for that period.  Unless otherwise requested in writing by
the customer, SAP shall promptly deliver to Reseller all customer satisfaction
questionnaires and surveys received by it with respect to the Reseller.

 

4.7                                 THIRD PARTY PRODUCTS. DUE TO THE UNUSUAL
COMPLEXITY OF THE SOFTWARE, SOME THIRD PARTY SOFTWARE AND HARDWARE MAY NOT BE
COMPATIBLE WITH THE SOFTWARE, MAY IMPOSE SPECIAL SUPPORT OBLIGATIONS OR MAY
HINDER THE SOFTWARE’S USE, THEREBY CAUSING DAMAGE TO SAP AND/OR RESELLER.
THEREFORE, RESELLER AGREES TO NOT DISTRIBUTE, SUPPORT, PROMOTE, OR RECOMMEND ANY
THIRD PARTY PRODUCT FOR PURPOSES OF INTEROPERATING WITH THE SOFTWARE WHICH HAS
NOT BEEN PREVIOUSLY APPROVED IN WRITING BY SAP OR OTHERWISE HAS BEEN MADE KNOWN
TO THE PUBLIC OFFICIALLY AS APPROPRIATE FOR USE OR INTEROPERATION WITH THE
SOFTWARE.  RESELLER’S BREACH OF THIS PROVISION SHALL BE A MATERIAL BREACH OF
THIS AGREEMENT.  IN THE EVENT RESELLER DESIRES TO DETERMINE WHETHER A THIRD
PARTY PRODUCT IS APPROVED BY SAP FOR INTEROPERATION WITH THE SOFTWARE, RESELLER
SHALL SUBMIT SUCH REQUEST IN WRITING TO SAP IN ACCORDANCE WITH SAP’S POLICIES. 
ALL EXPENSES RELATIVE TO THE THIRD PARTY PRODUCT APPROVAL SHALL BE BORNE BY
RESELLER, AND ANY SAP RESOURCES SHALL BE INVOICED AT SAP’S THEN-CURRENT RATES,
TO BE PAID WITHIN THIRTY (30) DAYS OF THE DATE OF SUCH INVOICE.  RESELLER SHALL
PROVIDE SAP NINETY DAYS’ PRIOR WRITTEN NOTICE OF ITS INTENTION TO DEVELOP OR
MARKET THIRD PARTY SOFTWARE INTEROPERABILITY WITH THE RESELLER SOFTWARE OR
RESELLER EXTENSIONS DISTRIBUTED AS PART OF THE SOFTBRANDS STACK.

 

4.8                                 MARKETING AND ADVERTISING.

 

4.8(a)                   Reseller agrees to promote locally within the
Territory, as necessary and appropriate, to promote the Software, achieve
Reseller’s sales targets, and exploit the local market potential for the
Software and Reseller’s maintenance and support services, as determined by the
Joint Marketing Committee.

 

4.8(b)                  As determined by the Joint Marketing Committee, Reseller
will be expected to participate actively in trade shows and events suitable for
promoting the Software and support services. All advertising, promotions, and
participation in trade shows and events shall be at Reseller’s expense, except
as otherwise agreed in writing between SAP and Reseller.

 

4.8(C)                   MARKETING AND PROMOTIONAL MATERIALS, INCLUDING
ADVERTISING AND PUBLICITY MATERIALS, WHICH ARE PROVIDED BY SAP WILL BE PROVIDED
BY SAP TO RESELLER UPON RESELLER’S REQUEST, AND CHARGED TO RESELLER AT SAP’S
COST, UNLESS OTHERWISE AGREED BETWEEN SAP AND RESELLER. AS DETERMINED BY THE
JOINT MARKETING COMMITTEE, RESELLER SHALL BE EXPECTED TO PARTICIPATE ACTIVELY IN
THE DEVELOPMENT OF SUCH MATERIALS.

 

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4.8(d)                  All marketing and promotional materials developed by or
for Reseller, including, but not limited to, print advertisement, broadcast or
telecast commercials, product brochures, sales aids, manuals, displays, and
publicity concerning the Software and services shall be of first quality and
graphically shall be designed to meet the buying characteristics of the target
market. All such materials shall be submitted to the SAP SMB Business
Development Manager to ensure consistency with SAP and industry standards for
review at least ten (10) business days prior to publication, distribution or
broadcast.

 

4.8(e)                   As determined by the Joint Marketing Committee, SAP
will agree from time to time to provide speakers and staff support without
charge to Reseller for conducting conferences subject to the availability of
SAP’s own resources and its prior obligations.

 

4.9                                 INFORMATION DUTIES OF RESELLER.

 

4.9(a)                   As determined by the Joint Marketing Committee,
Reseller will regularly inform SAP about its market, the marketing activities,
and the results of its sales efforts as related to the Software.  Such
information shall be considered Reseller Proprietary Information so long as the
exclusions in Section 1.12 do not apply to the information.

 

4.9(b)                  As determined by the Joint Marketing Committee, Reseller
will regularly solicit, and investigate requests from its Reseller Licensees for
alteration and further development of the Software and maintenance and support
services. It will submit proposals for such further development and support to
SAP for evaluation utilizing the SAP development support questionnaires.

 

4.9(c)                   As determined by the Joint Marketing Committee,
Reseller will provide accurate and up-to-date marketing and forecasting
information to SAP on a regular basis, in accordance with Section 4.3, including
prompt updates concerning matters that materially affect the current sales
forecast. From time-to-time, SAP may make special requests with respect to
marketing and forecasting information. Upon such requests, Reseller will use its
reasonable efforts to provide such information in an organized, timely and
accurate fashion.

 

4.9(d)                  As determined by the Joint Marketing Committee, Reseller
and SAP will conduct a Yearly Business Review, as directed by SAP.

 

4.10                           Reseller Licensee Training. As part of its
standard services offerings, Reseller, at its own expense, will make available
to its customers appropriate and necessary user training related to use of the
Software and training facilities or will arrange for the provision of such
training by SAP-authorized third party training partners or by SAP.

 

4.11                           Notification.  If Reseller learns of any
unauthorized Use by Reseller Licensees of the Software under the SAP End User
License Agreement, including any third party software, it shall promptly notify
SAP.

 

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5.                                       ADDITIONAL OBLIGATIONS OF THE PARTIES.

 

5.1.                              SALES EXECUTION PROCESS.  TO THE BEST OF ITS
ABILITY, RESELLER SHALL COMPLY WITH THE SAP STANDARD SALES EXECUTION PROCESS
WHICH INCLUDES THE PROCEDURES FOR, LICENSING OF THE SOFTWARE TO RESELLER
LICENSEES, PLACING ORDERS FOR SOFTWARE, DELIVERY OF SOFTWARE, AND INVOICING. 
SAP MAY AMEND THE SALES EXECUTION PROCESS UPON THIRTY (30) DAYS NOTICE TO
RESELLER

 

5.2                                 Encryption and Authorization Codes. Except
as expressly authorized or directed by SAP hereunder or elsewhere in writing,
Reseller shall not copy or arrange for or allow third parties to copy any part
of the Software or Documentation. Reseller shall comply with all of SAP’s
instructions regarding authorization codes, and any encryption and security
procedures and devices that may be incorporated from time to time within the
Software or any part of the Documentation

 

5.3                                 DUTY OF SAP TO DELIVER.

 

5.3(a) In accordance with the terms of this Agreement and SAP’s standard Sales
Execution Process, SAP shall make available to Reseller the Software,
Documentation, Maintenance, and other services as are offered to similarly
situated distributors of the Software by SAP from time to time.

 

5.3(b) In SAP’s reasonable discretion, SAP’s obligations under
Section 5.3(a) above may be suspended or waived under any of the circumstances
set forth in Sections 5.3(b)(i) through (vi). SAP shall notify Reseller
immediately when it has determined that it will suspend performance of any of
such obligations.  Unless SAP expressly indicates otherwise, suspension of any
such obligations shall not constitute a termination notice under Article 15.

 

5.3(b)(i) If Reseller has materially breached a provision of this Agreement and
such breach has not been remedied within thirty (30) days after SAP notifies
Reseller of such breach, or an anticipatory breach has occurred by Reseller and
reasonable assurances are not provided to SAP within thirty (30)  days of such
notice that the anticipated breach will not occur. Such breaches may include,
but are not limited to, delay in payment, violation of Software protection and
secrecy, marketing contrary to or in disregard of the standard practices of SAP,
and material, substantiated Reseller Licensee complaints attributable to
Reseller’s action or inaction;

 

5.3(b)(ii) If there are serious technical problems which exist with regard to
the Software and have not yet been corrected, product liability risks, or
problems in the production or third-party distribution of the Software;

 

5.3(b)(iii) If Reseller has not cured a failure to achieve or maintain full
compliance with a legal or other regulatory requirement which failure exposes
SAP or Reseller to the risk of penalties or other punitive action; or

 

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5.3(b)(iv) Reseller has executed a license agreement for the SoftBrands Stack
with a Reseller Licensee which contains obligations relative to the Software
which have not been approved by SAP in writing (other than standard maintenance
obligations as SAP provides to its own licensees).

 

5.3(b)(v) If Reseller fails to timely pay it invoices to SAP; or

 

5.3(b)(vi) If there is any other circumstance which SAP reasonably determines
endangers the security or confidentiality of the Software.

 

5.4                                 DELIVERY PROCEDURES.

 

5.4(a) SAP shall deliver the Software to Reseller for its or its Reseller
Agents’ delivery to Reseller Licensees. Delivery procedures shall be established
in the sales execution process in accordance with Section 5.1 of this
Agreement.  SAP shall not be liable to Reseller for delays in shipments due to
causes beyond SAP’s reasonable control.

 

5.4(b) The Software and Documentation will be provided in machine-readable form
on CD-ROM or such other media as SAP or SAP AG then provides to the commercial
market.

 

5.5                                 SUPPORT OF RESELLER.

 

5.5(a) SAP shall make available support services for Reseller and its Reseller
Licensees as set forth Appendix B to this Agreement. For services not set forth
herein, SAP will provide such services at the prices and under the conditions
set forth in its then-current SAP Business One U.S. List of Prices and
Conditions, or if not applicable then in accordance with SAP’s then-current
rates for such services, or as otherwise may be reasonably determined by SAP.

 

5.5(b) As more fully set forth in Appendix B, Reseller’s requests for support
service from SAP must be in writing (including by email) and with a description
of the technical problem and functionality requirements in sufficient detail to
allow SAP to properly evaluate the scope of any problem and the degree of
support required. Requests for support service from SAP in instance of critical
downtime may be made orally with a written request submitted shortly thereafter.
Prior to initiating any support, SAP, Reseller, and the Reseller Licensee, as
appropriate, shall consult and agree upon all aspects of support to be provided.

 

5.6                                 INFORMATION FOR RESELLER. SAP WILL KEEP
RESELLER INFORMED IN TIMELY FASHION OF MATTERS AFFECTING RESELLER AND ITS
RELATIONS WITH ITS RESELLER LICENSEES AND PROSPECTIVE RESELLER LICENSEES,
INCLUDING BUT NOT LIMITED TO NEW FUNCTIONALITY, TECHNICAL PROBLEMS, AND DELAYS
IN DELIVERY. SUCH NOTICE MAY BE MADE AVAILABLE IN SAP AG’S ONLINE SERVICE SYSTEM
AND CUSTOMER SUPPORT SYSTEM (“CSS OR CSU IN THE AMERICAS”) OR OTHER SAP ONLINE
SUPPORT PORTAL (COLLECTIVELY REFERRED TO AS, “OSS/CSU”) AT SAP’S SOLE
DISCRETION.  SAP WILL NOTIFY RESELLER AS MUCH IN ADVANCE OF SUCH DEVELOPMENTS AS
IS REASONABLY POSSIBLE AND SUFFICIENTLY IN ADVANCE OF CHANGES IN THE SOFTWARE
AND SAP BUSINESS TERMS, SO THAT RESELLER MAY TAKE THE STEPS NECESSARY TO
ACCOMMODATE SUCH CHANGES IN ITS BUSINESS OPERATIONS. SAP WILL PROVIDE RESELLER
WITH ACCESS TO

 

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OSS/CSU AS MAY BE NECESSARY UNDER THIS AGREEMENT IN SAP’S SOLE DISCRETION.

 

5.7                                 Use of Software by Reseller. Upon Reseller’s
request, SAP will provide a sufficient number of copies and licensed users for
the Software to Reseller for testing, training of its employees, and
demonstration by Reseller to prospective Reseller Licensees in accordance with
Section 2.1(a)(ii).  Any third party software required with the Software shall
be provided to Reseller at then-current prices in effect.  Reseller shall
thereafter bear all responsibility for maintenance and enforcement and
performance of third party license requirements.  In the event Reseller desires
the Software for its own Productive Use, Reseller and SAP shall execute SAP’s
standard SAP End User License Agreement in advance of such Productive Use.

 

6.                                       SOFTWARE MAINTENANCE AND SUPPORT
SERVICES.

 

6.1                                 Maintenance and Support Services.  The
parties shall provide the Maintenance and support services set forth in Appendix
B (“Maintenance”).  SAP reserves the right to alter, change, amend or otherwise
modify in any manner whatsoever Appendix B upon thirty (30) days prior written
notice to Reseller.

 

6.2                                 Availability to Reseller Licensees. 
Throughout the term of this Agreement, Reseller will offer to all Reseller
Licensees an opportunity to purchase Maintenance on such specific terms and at
such prices as Reseller may from time to time determine.  Reseller will promptly
notify SAP of each Reseller Licensee that purchases or renews an annual
agreement for such Maintenance, and of any Reseller Licensee that declines to
purchase or renew such annual Maintenance.

 

6.3                                 Annual Maintenance Royalty.  In
consideration of SAP’s provision of Maintenance services as described in
Appendix B, Reseller shall pay to SAP an annual Maintenance royalty as stated in
Appendix C.  The first annual (or such prorated portion thereof as applicable)
payment for such Maintenance royalty shall be due with the Software royalty
payment as stated in Article 7, and shall be pro-rated if such payment is due
prior to January 1 of the following calendar year.  Maintenance royalties are
invoiced on an annual basis in advance effective January 1 of a calendar year

 

6.4                                 Maintenance and Support Software.  In
addition to the Maintenance obligations stated in Section 6.1, SAP shall provide
maintenance support to Reseller for SAP Business One release 2004 and each
subsequent Software Release for a period of not less than twenty-four (24)
months from the date of initial commercial availability of such Software
Release.  SAP’s and Reseller’s obligations to provide Maintenance in accordance
with this Agreement shall survive termination of this Agreement for a period of
the greater of (i) twelve months, or (ii) if specifically agreed to in writing
by SAP, such longer period of time remaining on Reseller’s support obligations
to any Reseller Licensee.

 

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7.                                       PRICES AND PAYMENT.

 

7.1                                 Royalties and Payments. The royalties and
payment process for the Software, and the respective rights and obligations of
the parties with regard to remuneration, are set forth in Appendix C.  The
marketing and distribution of the Software by Reseller is subject to any
additional restrictions contained in the then-current SAP Business One U.S. List
of Prices and Conditions; provided however that nothing in the SAP Business One
U.S. List of Prices and Conditions shall be read to change or modify the terms
of this Agreement

 

7.2                                 Prices. The services provided by SAP to
Reseller will be governed by the most current SAP Business One U.S. List of
Prices and Conditions in effect for such services at the time the services are
rendered unless otherwise agreed; provided however that nothing in the SAP
Business One U.S. List of Prices and Conditions shall be read to change or
modify the terms of this Agreement.

 

7.3                                 Changes to Price List and Distribution of
Software.  SAP reserves the right (i) to change its standard SAP Business One
U.S. List of Prices and Conditions (applicable to all its Business One
customers) as may be reasonably required and consistent with SAP’s practices and
only upon providing Reseller with ninety (90) days prior written notice and
(ii) to discontinue the distribution of all or any components or functionality
of the Software upon sixty (60) days prior written notice to Reseller and to
cancel any orders for such discontinued Software without liability to Reseller
except the return of any prepaid license fees or service fees for such Software.

 

7.4                                 Overdue Accounts. Any amounts past due shall
bear simple interest from and after the date such amount is due until payment is
made at a rate per annum up to, and not exceeding, the U.S. prime rate plus 5%. 
The parties acknowledge and agree that all fees to be collected by it are for
its own account and shall not be applied to reduce, offset or make contingent
any payments due the other party.

 

7.5                                 Taxes and Duties. Reseller shall either
collect and pay or furnish SAP with appropriate proof of exemption from all
sales, use and other applicable taxes and all customs duties and fees, Export
taxes and fees, and other charges (with the exception of the income taxes of
SAP) applicable to SAP’s delivery of the Software and the Documentation to
Reseller or any services to the Reseller Licensee.  SAP shall have no liability
or obligation relative thereto.  Reseller shall provide to SAP copies of all
valid resale certificates prior to Reseller’s exercise of any rights under this
Agreement, shall keep current all such resale certificates, and shall notify SAP
immediately if any such resale certificates are no longer valid.

 

8.                                       REPRESENTATIVES.

 

8.1                                 Appointment. Each party shall appoint
qualified business and technical representatives who shall be responsible for
monitoring each phase of the marketing, distribution, and support efforts and
who shall act as the contact point(s) between the parties during the term of
this Agreement.

 

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8.2                                 Reports/Meetings. Reseller shall submit
those reports and attend those meetings related to the business of marketing and
distributing the Software as determined by the Joint Marketing Committee from
time to time.

 

9.                                       TRAINING.

 

9.1(a)  Training Obligation.  Reseller and Reseller’s key sales and marketing
personnel and key technical and support personnel shall attend an appropriate
number of designated SAP-sponsored Software training courses at rates set forth
in SAP’s then-current SAP Business One U.S. Price List and Conditions, or if not
applicable then in accordance with SAP’s then-current rates for such services,
or as otherwise may be reasonably determined by SAP.  SAP shall waive course
fees for Reseller for such scheduled training classes during the initial term of
this Agreement.  Reseller shall pay for travel accommodation, meals and other
related expenses for its attendees.

 

9.1(b)  Reseller Training.  In order for Reseller to fulfill its obligations
under Section 9.1(a), SAP shall provide to Reseller the documentation, materials
and training necessary in order for Reseller to conduct “train the trainer”
training for its employees and agents, which will provide for those individuals
being trained in the manner required by SAP’s then-current training program for
Software maintenance and support personnel.

 

9.2                                 Reseller Personnel.

 

9.2(a)  Reseller shall continue the training of sales and marketing personnel,
technical support personnel, and any consultants engaged by Reseller as required
to fulfill its obligations hereunder.

 

9.2(b) Upon written request of Reseller, training days may be scheduled by SAP
at rates set forth in its then-current SAP Business One U.S. List of Prices and
Conditions, or if not applicable then in accordance with SAP’s then-current
rates for such services, or as otherwise may be reasonably determined by SAP. 
Reseller shall pay SAP’s invoice for training, together with all travel and
living expenses of SAP’s representatives, if any, within thirty days of
submittal by SAP to Reseller.

 

9.2(c) Subject to § 9.1, SAP will provide training to Reseller’s pre-sales and
sales personnel by SAP, at then-current rates.  Any classes or training offered
at no charge, will be subject to reimbursement to SAP at then-current rates if
such personnel remain in Reseller’s employ but do not remain in sales or
pre-sales for at least twelve (12) months after training.

 

10.                                 RECORDS AND AUDITS.

 

10.1                           Proper Records. Reseller shall keep proper
records, books of account and logs concerning the distribution and reproduction,
if any, of the Software. Such records shall be adequate to

 

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determine the amount of license fees owed to SAP and shall be preserved by
Reseller for a period of three years immediately following termination of this
Agreement.

 

10.2                           Audit. During the term of this Agreement, and
during the three-year period immediately following termination, SAP shall have
the right to audit Reseller’s records concerning the reproduction and
sublicensing of the Software, and any other obligations of Reseller to SAP under
this Agreement. Such audits shall be conducted at SAP’s expense, during normal
business hours following written advance notice to Reseller not less than ten
business days in advance, and in a manner so as to not unreasonably interfere
with Reseller’s business operations.

 

10.3                           Confidentiality. SAP will keep any and all
Proprietary Information derived from any audits confidential. This Proprietary
Information shall not be used by SAP for any purpose other than to verify or
resolve any discrepancy involving the payment of license fees due from Reseller
under this Agreement and in SAP’s reviews of Reseller’s performance under this
Agreement (including in all cases use in proceedings to enforce SAP’s rights).

 

10.4                           Discrepancy. In the event an audit of Reseller’s
records, books of account or logs reveals that Reseller has underpaid any fees
or amounts due to SAP for the period under audit, Reseller shall promptly pay to
SAP the amount of the underpayment. If the amount of underpayment for the period
under audit exceeds ten percent of the amount owed during such period, Reseller
shall reimburse SAP for all reasonable costs incurred by SAP in connection with
the audit and, consistent with Section 15.2(b), SAP may determine to terminate
this Agreement.

 

11.                                 PROPRIETARY INFORMATION.

 

11.1                           OWNERSHIP OF PROPRIETARY INFORMATION.

 

11.1(a) Ownership of and title in and to all intellectual property rights,
including patent, copyright, trade secret, trademark, service mark, and domain
name rights, in the SAP Proprietary Information are and shall remain in SAP, SAP
AG, and their licensors. Reseller acquires only the right to use the SAP
Proprietary Information under the terms and conditions of this Agreement and
does not acquire any ownership rights or title in or to the SAP Proprietary
Information.  Reseller may only provide the Software and Documentation to
Reseller Licensees and Reseller Agents, or as otherwise provided herein.  Such
delivery must be in the SAP-provided form and on the SAP-provided media.

 

11.1(b) Notwithstanding any prior agreements to the contrary (including any SAP
End User Agreement with Reseller), as of the effective date of this Agreement
any Modifications that are created on behalf of Reseller or any third party
shall be the exclusive property of SAP.  Reseller expressly assigns any existing
rights in such Modifications to SAP and agrees to assign to SAP any such rights
that it may subsequently acquire, including but not limited to patent rights.
Upon SAP’s request, Reseller will execute, acknowledge, and deliver to SAP all
documents and do all things necessary, at SAP’s expense, to enable SAP to obtain
and secure all rights in such Modifications throughout the world.  Reseller will
secure the necessary rights and obligations from relevant employees and third
parties to satisfy the above obligations.  If SAP is unable, after reasonable
effort, to secure any signature on any application for patent, copyright,

 

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trademark, or other analogous registration or other documents regarding any
legal intellectual property protection, whether because of physical or mental
incapacity or for any other reason whatsoever, Reseller hereby irrevocably
designates and appoints SAP and its duly authorized officers and agents as its
agent and attorney-in-fact, to act for and in its behalf and stead to execute
and file any such application or applications or other documents and to do all
other lawfully permitted acts to further the prosecution and issuance of patent,
copyright, or trademark registrations or any other legal protection thereon with
the same legal force and effect as if executed by Reseller.

 

11.1(c)  As between Reseller and SAP, Reseller shall own all right, title, and
interest in and to any Reseller Proprietary Information including any Reseller
Software, training, documentation, or marketing materials created by Reseller.

 

11.1(d) Reseller shall maintain a current, complete, and accurate accounting of
the number and location of all copies of the Software and Documentation it has
licensed and all SAP Proprietary Information in its possession.

 

11.1(e) Reseller shall not remove any proprietary, copyright, patent, trademark,
or service mark legend from the Software, Documentation, Third Party Database,
or other SAP Proprietary Information. Reseller shall ensure that SAP’s, SAP
AG’s, and their licensors’ legends contained in or on any copies of the SAP
Proprietary Information remain in or on the original and any copies reproduced
by Reseller.  The inclusion of a copyright notice on any portion of the
Software, Documentation, Third Party Database, or any other Proprietary
Information shall not cause nor be construed to cause it to be a published work.

 

11.2                           PROTECTION OF PROPRIETARY INFORMATION.

 

11.2(a) Neither party shall, without the other party’s prior consent, use,
disclose, or make available any of the Proprietary Information of the other
party in any form to any person, except to those whose access is necessary to
enable such party to exercise its rights hereunder. Each party agrees that prior
to disclosing any Proprietary Information of the other party to any contractual
third party, it will obtain from that third party a written agreement containing
restrictions on use, copying, and disclosure that are at least equal to those
restrictions contained in this Article 11.

 

11.2(b) Reseller and SAP agree that any unauthorized use or disclosure to third
parties of the other’s Proprietary Information may cause immediate and
irreparable harm to the owner of the disclosed Proprietary Information;
therefore, each party agrees to take all reasonable steps and the same
protective precautions to protect the other’s Proprietary Information from
disclosure to third parties as it takes with its own proprietary and
confidential information, but in no event less than a reasonable degree of care.

 

11.2(c) In the event that Reseller becomes aware that unauthorized third parties
have obtained SAP Proprietary Information from Reseller and are making unlawful
use of any SAP Proprietary Information (including the Software and
Documentation) Reseller shall inform SAP immediately of any reports of such
activity. Reseller, at Reseller’s own cost, shall assist SAP as reasonably
requested by SAP in SAP’s enforcement of SAP’s rights in its Proprietary

 

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Information.  Such assistance includes, but is not limited to, sending cease and
desist notifications and terminating Maintenance.

 

11.2(d) In the event that SAP becomes aware that unauthorized third parties have
obtained Reseller Proprietary Information from SAP and are making unlawful use
of any Reseller Proprietary Information (including the Reseller Software
Documentation), SAP shall inform Reseller immediately of any reports of such
activity.  SAP at SAP’s cost, shall assist Reseller as reasonably requested by
Reseller in Reseller’s enforcement of Reseller’s rights in its Proprietary
Information.  Such assistance includes, but is not limited to, sending cease and
desist notifications.

 

11.2(e) Each party either has or shall establish specific procedures designed to
meet the obligations of this Agreement. Such procedures will include the
execution of appropriate agreements with such party’s contractors, agents, and
employees containing restrictions on use, copying, and disclosure that are at
least equal to those restrictions contained in Article 11, prior to any
disclosure of the Proprietary Information.  Reseller shall immediately notify
SAP in the event an employee, consultant, or agent of Reseller, for which a
C-number has been assigned by SAP for purposes of access to SAP and/or SAP AG
systems, is terminated, resigns or otherwise no longer requires such C-number.

 

11.3                           TRADEMARKS.

 

11.3(a) SAP hereby grants Reseller a non-exclusive, non-transferable, limited
license to use the trademarks and service marks used by SAP, SAP AG, or their
licensors in connection with the Software (collectively, the “Marks”). Reseller
may use the Marks solely in connection with the distribution, marketing,
promotion, and advertisement of the Software and Related Services described in
this Agreement. Reseller shall use the Marks in the proper form and manner and
with appropriate legends as prescribed by SAP from time to time. Reseller shall
not use the Marks in connection with any other trademarks, service marks or
logos without SAP’s prior approval.  With respect to Reseller’s use of the
Marks, Reseller shall comply with SAP’s trademark use guidelines as same may be
amended from time to time, as well as the SAP Partner Program.

 

11.3(b) All right, title, and interest in and to the Marks, including all
goodwill associated with the Marks, shall remain vested in SAP, SAP AG, or their
licensors. All use of the Marks by Reseller shall inure to the benefit of and be
on behalf of SAP, SAP AG or their licensors, as the case may be. Reseller
warrants that it will not act in a manner inconsistent with such ownership and
will not challenge the validity of the Marks.

 

11.3(c) The nature and quality of all uses of the Marks made by Reseller shall
conform to the standards set by SAP and communicated to Reseller, either
directly or indirectly.

 

11.3(d) Reseller will reasonably cooperate and assist SAP in registering,
maintaining, and protecting the Marks. Reseller will notify SAP promptly of any
unauthorized use of the Marks by others that comes to Reseller’s attention. SAP,
SAP AG, and their licensors shall have the sole right and discretion to bring
infringement or other proceedings involving the Marks; provided, however, that
it may agree with Reseller to jointly bring and/or pursue such proceedings.  SAP
shall bear the cost of registering, maintaining, protecting, and enforcing the
Marks.

 

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11.3(e) SAP may use the trademarks and service marks (other than the Marks) used
by Reseller in connection with the Reseller Software and Reseller Stack
(“Reseller Marks”) solely in connection with the marketing, promotion, and
advertisement of the Reseller Stack as proscribed by the Joint Marketing
Committee from time to time. Reseller shall use the Reseller Marks in the proper
form and manner and with appropriate legends as prescribed by Reseller from time
to time. SAP shall not use the Reseller Marks in connection with any other
trademarks, service marks or logos without Reseller’s prior approval.  With
respect to SAP’s use of the Reseller, SAP shall comply with Reseller’s trademark
use guidelines as same may be amended from time to time.

 

11.3(f) All right, title and interest in and to the Reseller Marks shall remain
vested in Reseller or its licensors.  All use of the Reseller Marks by SAP shall
inure to the benefit of and be on behalf of Reseller or its licensors, as the
case may be. SAP warrants that it will not act in a manner inconsistent with
such ownership and will not challenge the validity of the Reseller Marks.

 

11.3(g) The nature and quality of all uses of the Reseller Marks made by SAP
shall conform to the standards set by Reseller and communicated to SAP, either
directly or indirectly.

 

11.3(h) SAP will reasonably cooperate and assist Reseller in registering,
maintaining, and protecting the Reseller Marks. SAP will notify Reseller
promptly of any unauthorized use of the Reseller Marks by others that comes to
SAP’s attention. Reseller and its licensors shall have the sole right and
discretion to bring infringement or other proceedings involving the Reseller
Marks; provided, however, that it may agree with SAP to jointly bring and/or
pursue such proceedings.  Reseller shall bear the cost of registering,
maintaining, protecting, and enforcing the Marks.

 

12.                                 WARRANTIES; DISCLAIMER OF WARRANTY.

 

12.1(a) Reseller Representation and Warranty.  Reseller warrants that (i) within
industry standards, it has and will maintain sufficient resources to perform its
obligations under this Agreement; (ii) it is not prevented by any existing
arrangement, contractual or otherwise, from entering into this Agreement; and
(iii) is has now, and will maintain in the future, legal corporate status in
good-standing and that it will comply in all material respects with all legal
requirements applicable in every part of the Territory in which it does
business.

 

12.1(b) SAP Warranty.

 

12.1(b)(1)  Warranty Period; Performance Warranty.  SAP warrants that the
Software will substantially conform to the functional specifications contained
in the Documentation for six (6) months following delivery to the applicable
Reseller Licensee thereof (the “Warranty Period”) when Used without material
alteration on the Designated Unit(s).

 

12.1(b)(2)  Scope of Warranty.  The warranty set forth in this
Section 12.1(b) shall not apply:  (i) if the Software is not used in accordance
with the Documentation; or (ii) to any Extensions or Modifications; or (iii) if
the defect is caused by a Modification or Extension, Reseller Licensee, or a
third-party software malfunction.

 

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12.1(b)(3)  General Warranty.  SAP warrants that (i) within industry standards,
it has and will maintain sufficient resources to perform its obligations under
this Agreement; (ii) it is not prevented by any existing arrangement,
contractual or otherwise, from entering into this Agreement; and (iii) is has
now, and will maintain in the future, legal corporate status in good-standing
and that it will comply in all material respects with all legal requirements
applicable in every part of the Territory in which it does business.

 

12.2                           Express Disclaimer. EXCEPT AS SPECIFICALLY SET
OUT IN § 12.1 HEREOF, SAP DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, AT LAW
OR IN EQUITY, RELATED TO THE SOFTWARE AND ANY THIRD PARTY SOFTWARE, OR ITS
CHARACTERISTICS, QUALITY, PERFORMANCE, OR VALUE, INCLUDING WITHOUT LIMITATION
THE IMPLIED WARRANTIES OF MERCHANTABLE QUALITY, MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, AND NON-INFRINGEMENT, EXCEPT TO THE EXTENT THAT ANY
WARRANTIES IMPLIED BY LAW CANNOT BE VALIDLY WAIVED.  EXCEPT AS SPECIFICALLY SET
OUT IN § 12.1(b) HEREOF, SAP DOES NOT MAKE ANY REPRESENTATIONS OR WARRANTIES
REGARDING THE USE OR PERFORMANCE OF THE SOFTWARE WITH ANY THIRD PARTY SOFTWARE
(OTHER THAN THE SOFTWARE’S COMPATIBILITY WITH THE THIRD PARTY DATABASE) AND
DISCLAIMS ALL WARRANTIES WITH RESPECT THERETO IN ACCORDANCE WITH THIS
SECTION 12.2.  SAP MAKES NO REPRESENTATIONS OR WARRANTIES THAT THE SOFTWARE WILL
OPERATE UNINTERRUPTED OR ERROR-FREE, OR THAT IT WILL BE FREE FROM MINOR DEFECTS
OR ERRORS THAT DO NOT MATERIALLY AFFECT PERFORMANCE, OR THAT THE APPLICATIONS
CONTAINED IN THE SOFTWARE ARE DESIGNED TO MEET ALL OF RESELLER’S OR A RESELLER
LICENSEE’S BUSINESS REQUIREMENTS AND DISCLAIMS ALL WARRANTIES WITH RESPECT
THERETO IN ACCORDANCE WITH THIS SECTION 12.2.

 

12.3                           No Representations or Warranties. Reseller shall
not make any representations or warranties as to the performance of the
Software, Maintenance, or other services on behalf of SAP or SAP AG, or
otherwise bind SAP or SAP AG.  SAP’s warranty obligations, limitations, and
liabilities related to the SAP End User License Agreement with Reseller Licensee
shall be solely as stated therein.

 

13.                                 LIMITATION OF LIABILITY.

 

13.1                           SAP Not Responsible. Neither SAP, SAP AG, nor
their licensors will be responsible under this Agreement for: (i) the
modification or improvement of the Software to fit the particular requirements
of Reseller or a Reseller Licensee, or (ii) the correction of any program errors
as a result of misuse of the Software by Reseller or by any Reseller Licensee.
Under no condition will SAP, SAP AG, or their licensors be responsible under
this Agreement for preparation or conversion of data into the form required for
Use with the Software.

 

13.2                           Exclusion of Damages/Liability Limit. ANYTHING TO
THE CONTRARY HEREIN NOTWITHSTANDING, EXCEPT FOR (a) DAMAGES RESULTING FROM
UNAUTHORIZED USE OR DISCLOSURE OF THE RESELLER PROPRIETARY

 

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INFORMATION, OR (b) DAMAGES UNDER SECTION 14.3(SUBJECT TO THE LIMITATIONS WITHIN
THAT SECTION)UNDER NO CIRCUMSTANCES SHALL SAP, SAP AG, OR THEIR LICENSORS BE
LIABLE TO RESELLER, ANY RESELLER LICENSEE, OR ANY OTHER PERSON OR ENTITY FOR AN
AMOUNT OF DAMAGES IN EXCESS OF THE TOTAL AMOUNT PAID BY RESELLER TO SAP FOR
SOFTWARE ROYALTIES DURING THE TWELVE (12) MONTH PERIOD IMMEDIATELY PRECEDING THE
EVENTS GIVING RISE TO THE CLAIM.  ANYTHING TO THE CONTRARY HEREIN
NOTWITHSTANDING, EXCEPT FOR (a) DAMAGES RESULTING FROM UNAUTHORIZED USE OR
DISCLOSURE OF THE SAP PROPRIETARY INFORMATION, OR (b) DAMAGES RESULTING FROM
BREACH OF §14.4, UNDER NO CIRCUMSTANCES SHALL RESELLER OR ITS AFFILIATES, OR
THEIR LICENSORS, BE LIABLE TO SAP, SAP AG OR ANY OTHER PERSON OR ENTITY FOR ANY
AMOUNT OF DAMAGES IN EXCESS OF THE TOTAL AMOUNT PAID BY RESELLER TO SAP FOR
SOFTWARE ROYALTIES DURING THE TWELVE (12) MONTH PERIOD IMMEDIATELY PRECEDING THE
EVENTS GIVING RISE TO THE CLAIM.  ANYTHING TO THE CONTRARY HEREIN
NOTWITHSTANDING, UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE
OTHER PARTY, OR THEIR RESPECTIVE AFFILIATES (INCLUDING SAP AG) OR LICENSORS, BE
LIABLE TO THE OTHER PARTY OR ANY OTHER PERSON OR ENTITY FOR SPECIAL, INCIDENTAL,
CONSEQUENTIAL, OR INDIRECT DAMAGES, LOSS OF GOODWILL OR BUSINESS PROFITS, WORK
STOPPAGE, DATA LOSS, COMPUTER FAILURE OR MALFUNCTION, ANY AND ALL OTHER
COMMERCIAL DAMAGES OR LOSS, OR EXEMPLARY OR PUNITIVE DAMAGES, EVEN IF ADVISED OF
THE POSSIBILITY THEREOF.

 

13.3                           The foregoing limitation of liability does not
apply to personal injury or death to the extent caused by the negligence of or
willful misconduct of either party.  With respect to damage to tangible personal
property (excluding data), SAP, SAP AG, or their licensors will not be
responsible in any amount in excess of the amount by which such damage is paid
by the liability insurance of such entity.

 

13.4                           Severability of Disclaimer Provisions. IT IS
EXPRESSLY UNDERSTOOD AND AGREED THAT EACH AND EVERY PROVISION OF THIS AGREEMENT
THAT PROVIDES FOR A LIMITATION OF LIABILITY, DISCLAIMER OF WARRANTY, OR
EXCLUSION OF DAMAGES, IS INTENDED BY THE PARTIES TO BE SEVERABLE AND INDEPENDENT
OF ANY OTHER PROVISION AND TO BE ENFORCED AS SUCH.

 

13.5                           Professional Advice. RESELLER ACKNOWLEDGES THAT
NONE OF SAP, SAP AG, OR THEIR LICENSORS ARE ENGAGED IN THE BUSINESS OF RENDERING
LEGAL, TAX, OR OTHER PROFESSIONAL SERVICES, AND THAT THE INFORMATION PROVIDED BY
SAP RELATIVE TO THIS AGREEMENT OR IN RESPONSE TO RESELLER INQUIRIES ARE NOT
INTENDED TO PROVIDE LEGAL, TAX, OR OTHER EXPERT ADVICE TO RESELLER, OR BE A
SUBSTITUTE FOR A LAWYER, ACCOUNTANT, OR OTHER PROFESSIONAL. IF RESELLER NEEDS
LEGAL OR TAX ADVICE OR OTHER EXPERT ASSISTANCE, THE SERVICES OF A COMPETENT
LAWYER, ACCOUNTANT, OR OTHER

 

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PROFESSIONAL LICENSED TO PRACTICE IN THE APPLICABLE JURISDICTION SHOULD BE
SOUGHT.

 

14.                                 INDEMNIFICATION.

 

14.1                           SAP Representation. SAP represents that SAP, SAP
AG and its licensors, as the case may be, own the SAP Proprietary Information
licensed by SAP to Reseller hereunder, including all intellectual property
rights therein, and that SAP has all rights from SAP AG and its licensors
necessary to license, in accordance with the terms of this Agreement, such SAP
Proprietary Information to Reseller.

 

14.2                           No Representation Regarding Combination Use. SAP
makes no representation with respect to the possibility of infringement by
Combination Use of the Software. The parties agree that SAP has no duty to
investigate or to warn Reseller or Reseller Licensees of such possibility.

 

14.3                           Indemnification of Reseller.

 

14.3(a) Subject to Section 14.2, SAP shall indemnify Reseller against all
claims, liabilities and costs and expenses, including reasonable legal fees, up
to the maximum amount described in Section 14.3(b), reasonably incurred in the
defense of any claim made or brought against Reseller by third parties alleging
that (a) use of the Marks as authorized pursuant to § 11.3 hereof, or (b) Use of
the Software infringes or misappropriates any valid: (i) United States or
European Union country member patent, or (ii) copyright, or (iii) trade secret
or other proprietary rights; provided that Reseller promptly notifies SAP in
writing of any such claim and SAP is permitted to control fully the defense and
any settlement of such claim. Reseller shall cooperate fully in the defense of
such claim and may appear, at its own expense through counsel reasonably
acceptable to SAP. SAP may, in its sole discretion, settle any such claim on a
basis requiring SAP to substitute for the Software alternative substantially
equivalent non-infringing programs and supporting Documentation.

 

14.3(b) The maximum aggregate liability of SAP under the indemnity provided in
Section 14.3(a) above shall be limited to a sum equal to the full amount of the
Software royalties paid to SAP by Reseller at the time the claim of infringement
arises, and if there should be more than one claim of infringement, the amount
payable under such indemnity in respect of each claim shall be divided pro rata.

 

14.4                           Indemnification of SAP. Reseller shall indemnify
SAP, SAP AG and its licensors against all claims, liabilities, and costs and
expenses, including reasonable legal fees, reasonably incurred in the defense of
any claim made or brought against SAP by third parties arising out of (i) any
misrepresentations related to the Software made by Reseller or Reseller Agents
that are beyond what is contained in the Documentation or other SAP officially
sanctioned materials, or Modifications made by Reseller to the Software, or
(ii) Reseller’s unauthorized Use or distribution as set forth in Section 17.8,
or (iii) Reseller’s breach of Section 7.5, or (iii) Reseller’s breach of
Section 3.3 or noncompliance with applicable U.S. or foreign law with respect to
the

 

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use or transfer of the Proprietary Information outside the United States by
Reseller; provided that, SAP promptly notifies Reseller in writing of such claim
and that Reseller is permitted to control fully the defense and any settlement
of the claim.  SAP shall cooperate fully in the defense of such claim and may
appear, at its own expense through counsel reasonably acceptable to Reseller.

 

14.5                           Rights to Commence Infringement Actions.

 

14.5(a) SAP alone shall be responsible for taking such actions which it
determines are reasonably necessary or desirable in its sole discretion in
connection with any infringement or alleged infringement by a third party of any
portion of the Software. Reseller shall not undertake any action in response to
any infringement or alleged infringement of the Software without the prior
written consent of SAP.  Reseller agrees to cooperate with and assist SAP in
taking whatever action (including consenting to being named as a party to any
suit or other proceeding) SAP determines to be reasonably necessary or
desirable. SAP agrees to reimburse Reseller for reasonable legal fees and other
expenses incurred in connection with investigating, commencing or participating
in an action with respect to any such claim, suit, damage, or loss.

 

14.5(b) Subject to SAP rights as provided in §14.5(a), Reseller alone shall be
responsible for taking such actions which it determines are reasonably necessary
or desirable in its sole discretion in connection with any infringement or
alleged infringement by a third party of any portion of the SoftBrands Stack,
expressly excluding any infringement claims relating to the Software.. Subject
to SAP rights as provided in §14.5(a), SAP shall not undertake any such action
in response to any infringement or alleged infringement of the SoftBrands Stack
without the prior written consent of Reseller.  SAP agrees to cooperate with and
assist Reseller in taking whatever action (including consenting to being named
as a party to any suit or other proceeding) Reseller determines to be reasonably
necessary or desirable. Reseller agrees to reimburse SAP for reasonable legal
fees and other expenses incurred in connection with investigating or commencing
action with respect to any such claim, suit, damage, or loss.

 

14.6                           SAP’s Duty to Indemnify Reseller. THE PROVISIONS
OF THIS ARTICLE 14 STATE THE SOLE, EXCLUSIVE AND ENTIRE LIABILITY OF SAP, SAP AG
AND ITS LICENSORS TO RESELLER, AND RESELLER’S SOLE REMEDY, WITH RESPECT TO THE
INFRINGEMENT OF THIRD PARTY INTELLECTUAL PROPERTY RIGHTS.

 

15.                                 TERM AND TERMINATION.

 

15.1                           Term. This Agreement shall be effective on the
date specified in the first paragraph of this Agreement and shall have the term
specified in Section 2.1, unless sooner terminated as provided herein.  Unless
otherwise agreed to in writing by the parties, this Agreement shall terminate
automatically upon the expiration of the term.

 

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15.2                           Termination. A party may terminate this
Agreement:

 

15.2(a) Upon thirty (30) days notice if the other party becomes insolvent, is
the subject of a petition in bankruptcy that is not resolved within sixty days,
admits in writing its inability to pay its debts, makes an assignment for the
benefit of creditors, ceases doing business, or attempts an unauthorized
assignment of this Agreement;

 

15.2(b) Upon notice, if the other party defaults in the performance of any
material obligation of this Agreement, including without limitation failure to
promptly pay any amount due hereunder, and fails to cure such default within
thirty (30) days after receiving notice specifying the default;

 

15.2(c) Immediately and without prior notice if (i) the other party breaches the
Proprietary Information provisions of Article 11, or (ii), in the case of
termination by SAP against Reseller, if there is a creation of a direct or
indirect financial interest in Reseller with or by another entity that owns or
markets a product competitive with the Software (a “Competitor”) that results in
such entity being required to file a notification pursuant to § 13(d) of the
Securities Act of 1934.

 

15.3                           Rights and Obligations Upon Termination.
Subsequent to any termination or expiration of this Agreement, the parties shall
have the following rights and obligations:

 

15.3(a) Both parties shall cease acting in a manner that would suggest any
continuing relationship between the parties regarding the Software and shall
cease all display, advertising and marketing contemplated under this Agreement;
provided that, subject to Section 15.5, SAP and Reseller shall continue to
provide such Maintenance services to its Reseller Licensees pursuant to a
contract with such Reseller Licensees or under this Agreement and in all cases
in accordance with Section 6.4.  Such post-termination Maintenance period under
Section 6.4 may be extended by the parties in the event and to the extent SAP
continues its support of Reseller (via prior written agreement) beyond such
post-termination Maintenance period.

 

15.3(b) Within thirty (30) days of demand by SAP to Reseller, Reseller shall
return or destroy all copies of the Software and any materials associated with
the Software in Reseller’s possession or control as a result of this Agreement.

 

15.3(c) Reseller shall immediately cease any Use (except as necessary to perform
its ongoing Maintenance obligations, if any), reproduction, licensing, or
distribution of the Software pursuant to the license granted under this
Agreement.

 

15.3(d) Within thirty (30) days of SAP’s request, Reseller shall certify in a
writing acceptable to SAP that all copies of the Software and other SAP
Proprietary Information have been delivered to SAP, destroyed or rendered
unusable, as required under this Agreement ;

 

15.3(e) Within thirty (30) days of Reseller’s request, SAP shall certify in a
writing acceptable to Reseller that all copies of the Reseller Proprietary
Information provided under this Agreement have been delivered to Reseller,
destroyed or rendered unusable.

 

15.3(f) Reseller shall not Use or employ any Software as part of any other
product that Reseller may Use, license or distribute after the date of
termination or expiration of this Agreement, except as may be permitted under
any other agreement between the parties, including the Solution Partner
Agreement.

 

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15.3(g) Reseller shall immediately cease and desist from any use of the SAP
Marks pursuant to the license granted to Reseller hereunder.

 

15.4                           Effect of Termination Upon Licenses. Upon
termination or expiration of this Agreement, all valid licenses between SAP and
Reseller Licensees shall remain and continue in full force and effect for the
remainder of their term. SAP shall have no liability to Reseller for any future
activities with respect to such Reseller Licensees.

 

15.5                           Maintenance Continuance. Reseller shall provide
SAP with the names and addresses of all Reseller Licensees to whom Reseller is
under written agreement to provide Maintenance.  At SAP’s option, Reseller shall
assign and delegate the rights and duties any of such Maintenance agreements to
SAP.

 

15.6                           Survival. The following provisions of this
Agreement shall in all events survive its termination or expiration: Sections
6.4, 11.1, 11.2, 11.3(b), 11.3(f), 12, 13, 14, 15.3, 15.7, 15.8, 16, 17, and
this Section 15.6.  All obligations to pay valid invoices shall survive
termination or expiration of the Agreement, for any reason. Termination
resulting from Reseller’s breach of this Agreement shall result in the immediate
acceleration of Reseller’s obligation to pay all sums due to SAP under this
Agreement.

 

15.7                           Rights Not Exclusive. The rights and remedies of
SAP and Reseller included in this Article 15 shall not be exclusive and are in
addition to any other rights and remedies provided by law or equity.

 

15.8                           No Compensation. SAP shall not be liable to
Reseller for damages, losses, or expenses of any kind or character on account of
the termination or expiration of this Agreement, whether such damage, loss, or
expense may arise from the loss of existing or prospective customers of
Reseller, or expenses incurred or investments made in connection with the
establishment, development, or maintenance of Reseller’s business with respect
to the matters contemplated under this Agreement. Subject in all cases to
applicable law, termination or expiration shall not affect any valid claim,
demand, or liability of either party created or arising hereunder prior to such
termination or expiration.

 

16.                                 ASSIGNMENT.

 

16.1                           Consent Necessary. This Agreement shall not be
assigned or transferred by Reseller without the prior written consent of SAP
which consent may not be unreasonably withheld  Any attempt to assign this
Agreement without such consent shall be void.

 

17.                                 GENERAL.

 

17.1                           Notices. All notices or reports which are
required or may be given pursuant to this Agreement shall be in writing and
shall be deemed duly given when delivered to the respective executive offices of
SAP and Reseller at the addresses first set forth above.

 

17.2                           Governing Law. This Agreement shall be construed
and controlled by the laws of the Commonwealth of Pennsylvania without reference
to its choice of law rules.

 

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17.3                           Injunctive Relief. Both parties acknowledge that
remedies at law may be inadequate to provide SAP or Reseller with full
compensation in the event of Reseller’s material breach of Sections 11 or 15.3,
or SAP’s material breach of Sections 11 and that the non-breaching party shall
therefore be entitled to seek injunctive relief in the event of any such
material breach.

 

17.4                           Amendment. Neither party may amend this
Agreement, except by a written amendment or supplement signed on behalf of SAP
and Reseller by their respective duly authorized representatives.

 

17.5                           Successors. This Agreement shall inure to the
benefit of and be binding upon the parties, their successors, administrators,
and authorized assigns.

 

17.6                           Waiver. The failure of either party to enforce
any term or condition of this Agreement shall not constitute a waiver of either
party’s right to enforce each and every term and condition of this Agreement.

 

17.7                           Unenforceable Provisions. Should any provision of
this Agreement be held by an arbitrator or a court of competent jurisdiction, as
the case might be, to be illegal, invalid or unenforceable, the remaining
provisions of this Agreement shall not be affected or impaired thereby.

 

17.8                           Relationship. Reseller is an independent
contractor and is not an agent, employee, or legal representative of SAP. 
Reseller expressly acknowledges that it has no power or authority to accept any
order for SAP, or to make guarantees or warranties concerning the Software or
the delivery thereof on behalf of SAP, or to make any commitment for SAP or to
obligate SAP in any respect whatsoever.  Reseller agrees to indemnify SAP and to
hold SAP harmless from and against any loss, claim, damages, fees (including
attorneys’ fees) or award arising from any breach of Reseller’s obligations
under this Section 17.8, including but not limited to any violation or action in
excess of Reseller’s authority hereunder and arising out of any claims by any
Reseller Licensees.  This Agreement shall not be construed as creating a
partnership, joint venture, agency relationship, or granting a franchise under
any applicable laws.

 

17.9                           Force Majeure. Any delay or nonperformance of any
provision of this Agreement (other than for the payment of amounts due
hereunder) caused by conditions beyond the reasonable control of the performing
party shall not constitute a breach of this Agreement, and the time for
performance of such provision, if any, shall be deemed to be extended for a
period equal to the duration of the conditions preventing performance.

 

17.10                     Confidential Terms and Conditions.  Neither Party
shall disclose the terms and conditions of this Agreement to any third-party,
except to the limited extent such disclosure is required by law or regulation or
to professional advisors (such as accountants, attorney and financial advisors)
under a written non-disclosure agreement.  This provision shall not be construed
as to prohibit SAP from including information about Reseller in it normal
Partner

 

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program promotions, advertising and customer communications.

 

17.11                     Interim Agreement.  The parties entered into that
certain SAP Business One Software Marketing and Distribution Agreement as of
September 30, 2004, including the Rider to such agreement (collectively, the
“Interim Agreement”) in order to provide a legal basis for the completion of
certain end user transactions during the negotiation of this Agreement. 
Effective upon the execution of this Agreement, the Interim Agreement is
terminated in full and superceded by this Agreement, all such end user
transactions will be governed, in all respects, by the terms and conditions of
this Agreement as if executed pursuant hereto.

 

17.12                     Entire Agreement.  This Agreement and the Solution
Partner Agreement, including all exhibits and documents referenced therein, are
the complete and exclusive statement of the agreement between SAP and Reseller,
and all previous representations, discussions, and writings are merged in, and
superseded by, this Agreement and the Solution Partner Agreement.  This
Agreement may be modified only by a writing signed by both parties.

 

IN WITNESS WHEREOF, the undersigned, intending to be legally bound, have duly
executed this Agreement to become effective as of the date first above written.

 

Accepted by:

Accepted by:

SOFTBRANDS, INC.

SAP AMERICA, INC.

 

 

Name:

 

 

Name:

 

 

 

 

 

 

 

 

Title:

 

 

Title:

 

 

 

 

 

 

 

 

Signature:

 

 

Signature:

 

 

 

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