Form Of Open Server Research & Development Agrmt.

EXHIBIT 10.36


OPEN SERVER RESEARCH AND DEVELOPMENT AGREEMENT


THIS OPEN SERVER RESEARCH AND DEVELOPMENT AGREEMENT, ("Agreement") made and entered into effective the ____ day of ____ 2000, ("Effective Date") by and between The Santa Cruz Operation, Inc., a California corporation, ("SCO") and Caldera, International, Inc., a Delaware corporation ("Caldera ") (together, the "Parties").


WHEREAS, SCO and Caldera are parties to an Agreement and Plan of Reorganization, dated August 1, 2000, as amended on September 13, 2000, whereby SCO has transferred to Caldera certain of its assets (the "Transaction");


WHEREAS, SCO has retained the Open Server UNIX business and has engaged Caldera, pursuant to the terms of that certain Sales Representative and Support Agreement (the "Sales Representative Agreement"), dated as of the date hereof, for the purpose of (i) soliciting and procuring orders for SCO's Products (as defined below) in the Territory and (ii) marketing the Products;


WHEREAS, SCO also desires to engage Caldera for the purpose of providing research and development services of the type described in Attachment A (the "R&D Services").


NOW, THEREFORE, the parties agree as follows:


1. Appointment; Territory.


SCO hereby appoints Caldera, and Caldera hereby agrees to act, as the exclusive provider to SCO of the R&D Services worldwide (the "Territory"), for the term of this Agreement, subject to all of the terms and conditions of this Agreement.


2. Products.


Products. The products covered by this Agreement ("Products") are those Open Server UNIX products in binary form listed on Attachment B hereto.


3. Fees; Expense Reimbursements.


a. In consideration for the duties of Caldera contained herein and as the entire compensation of Caldera for its services under this Agreement, SCO will pay Caldera fees equal to 110% of all direct and indirect costs relating to the R&D Services, including, but not limited to, costs relating to taxes, payroll, employment benefits, facilities (for which the costs shall not be unreasonable, based on costs relative to comparable (job and location) Caldera employees), equipment and training of employees who will be working on the Products (the "R&D Costs"). In no event shall Caldera allocate any general and administrative costs to the R&D costs, such as, but not limited to, legal, finance and human resources.


b. Invoices shall be issued on the fifteenth day of each month for the R&D Costs of the previous month. SCO shall pay invoices within fifteen (15) days from the date of


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receipt of the invoice. Fees will be paid in U.S. dollars by check or wire transfer. Any late payments will accrue interest at 8% per annum until paid.


c. Verification. Both parties shall, upon ten (10) days written notice, be given access to the books and records of the other party to the extent necessary for purposes of verifying that appropriate fees and reimbursements to be paid under this Agreement are being accounted for and paid in accordance therewith. No party shall request verification more than two times per calendar year.


4. Relationship of Parties. The parties hereto expressly understand and agree that Caldera is an independent contractor in the performance of each and every part of this Agreement and is solely responsible for all of its employees and agents and its labor costs and expenses arising in connection therewith and for any and all claims, liabilities or damages or debts of any type whatsoever that may arise on account of Caldera's activities, or those of, its employees or agents in the performance of this Agreement. Caldera has no authority, right or ability to bind or commit SCO in any way (including, without limitation, by receiving orders) or sell any Products and will not attempt to do so or imply that it may do so.


5. Responsibilities of Caldera. Caldera's duties hereunder are as follows:


a. Caldera will employ a sufficient number of qualified employees and agents, as it determines in its reasonable discretion, for purposes of performing all of its duties set forth herein and providing the deliverables ("Deliverables") set forth in the Product Roadmap (as defined below) from time to time. SCO agrees that Caldera shall be permitted to make use of incidental individual subcontractors onsite, where such useage is consistent with Caldera's normal management practices and costs, such as, without limitation, for supplementing skill sets and covering employee absences. Such incidental useage shall not, without the prior approval of SCO, exceed 30% of the costs for any particular three month period, as set forth in the Product Roadmap. In addition, Caldera may subcontract offsite specific development work on the Deliverables to the extent that such subcontracting is consistent with the development process, staffing plan, methodology, schedule and estimated costs as may be set forth in the Product Roadmap (as defined below).


b. Every three months, starting with the date that is three months from the Effective Date, Caldera shall provide for SCO's approval, which shall not be unreasonably withheld, a rolling product roadmap (the "Product Roadmap") setting forth: (i) a description of the projects to be undertaken during the next twelve month period; (ii) the expected Deliverables and delivery dates; (iii) the estimated resources required for such Deliverables; (iv) SCO's responsibilities; and (v) R&D Costs. A product roadmap for the initial twelve month period is attached hereto as Attachment C.


c. Caldera will keep SCO informed as to any problems encountered with the Product Roadmap and as to any resolutions arrived at for those problems, and will communicate promptly to SCO any and all modifications, design changes, improvements of the Products, or new significant customer requirements that materially change the Deliverables identified in the Product Roadmap suggested by any entity or person solicited by or making inquiries of Caldera or by any employee or agent of Caldera. All subsequent additions, deletions or changes to the


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R&D Services desired by SCO shall be included in the next Product Roadmap or be subject to mutual agreement between the parties and shall require execution of a written change order by both parties (a "Change Order") which shall substantially conform to the format of the document attached hereto as Attachment E. Each Change Order complying with this section shall be deemed to be an amendment to the applicable Product Roadmap, which will become an integral part of such Product Roadmap upon the later of the dates on which the parties execute the Change Order. Caldera shall not perform any new or additional services until the earlier of a new Product Roadmap executed by the parties or a duly executed Change Order. Caldera will not be responsible for any delay in the performance of R&D Services due to causes beyond the reasonable control of Caldera.


d. Caldera shall use its reasonable best efforts to incent and retain the core OpenServer development engineers on a comparable basis as with other employees of the same level of responsibility.


6. Duties of SCO. SCO will have the following responsibilities during the term of this Agreement:


a. SCO will provide Caldera, at SCO's expense, with current catalogs, data sheets, engineering data, source code, application data, answers to technical and commercial inquiries, and any other information required in, or helpful to, Caldera's provision of the R&D Services in the Territory ("Development System"). Notwithstanding the above, SCO shall have no obligation to make updates to the Development System or items to be provided to Caldera, or to supplement the inventory levels of the Development System and items. Any printed materials, equipment, spare parts or source code furnished by SCO to Caldera will be and remain at all times the property of SCO.


b. SCO hereby grants to Caldera (pursuant to SCO's intellectual property rights therein) a worldwide, nonexclusive, royalty-free license to use, modify, and make derivatives works of the Development System, including the source code provided to Caldera, and the Products for the sole purpose of performing the R&D Services under this Agreement.


c. Caldera's timely performance of its obligations hereunder is, in part, subject to and dependent on timely performance by SCO of its obligations as set forth in this Section and the applicable Product Roadmap. Caldera shall not be responsible for any delay in, or inability to perform, any services or provide any deliverables that is the direct result of any failure or delay by SCO in the performance of its obligations.


7. Term and Termination.


a. Subject to the provisions for termination as provided herein, this Agreement will commence on the Effective Date and will terminate automatically upon the termination of the Sales Representative Agreement.


b. Except as otherwise provided herein, the provisions of this Agreement which by their nature are continuing obligations of this Agreement termination shall survive termination pursuant to this Section 7.


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8. Proprietary Information; Proprietary Rights


a. Caldera acknowledges that, in the course of performing its duties under this Agreement, it may obtain information relating to products and to SCO which is of a confidential and proprietary nature ("Proprietary Information"). All Proprietary Information will be clearly marked as such by SCO with a label stating "Confidential" or "Proprietary", except for source code of SCO, which by its nature is Proprietary Information. Such Proprietary Information may include, without limitation, computer codes, trade secrets, know-how, inventions, techniques, processes, programs, algorithms, schematics, data, customer lists, financial inform ...