Non-exclusive Distributor Agreement

Portions denoted with an asterisk have been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for confidential treatment.


EXHIBIT 10.17


NON-EXCLUSIVE DISTRIBUTOR AGREEMENT
between
Computer 2000 AG (Holding)
and
BAY NETWORKS, INC.


Bay Agreement Number: E1322-97DSV Initial Term of Agreement: Effective Date: 25 September, 1995 2 years from Effective Date


Computer 2000 AG (Holding) having a principal address at Wolfratahauser Strasse 84, 81379 Munich, Germany ("Holding") and Bay Networks, Inc., 8 Federal Street, Billerica, MA 01821, U.S.A. ("Bay") agree that the following terms shall govern the sale, licensing and discounting of Product (as defined in Exhibit 1 - Distributor Purchase and License Terms). Bay and Holding agree that Holding concludes this Agreement on behalf of its subsidiaries (hereinafter individually and collectively, as the context requires, called "Distributor"), which are entitled to purchase and market Bay Products under the terms of this Agreement. Individual purchase orders will be placed by Distributor. Should country-specific and/or legal needs require deviations from the terms of this Agreement, then such deviations must be individually agreed between Distributor and Bay and acknowledged through an addendum to this Agreement, Computer 2000 AG (Holding) itself is not obligated by this Agreement. This Agreement renders all other existing contracts between Holding, Distributor, and Bay invalid.


EXHIBITS CONTAINED IN THE AGREEMENT (Exhibit 4 applies only when activated in accordance with Exhibit 6, paragraph 2(f)):


Exhibit 1 - Distributor Purchase and License Terms


Exhibit 2 - Distributor Discount and Special Pricing Terms


Exhibit 3 - Distributor Reseller terms and criteria


Exhibit 4 - Bay Networks Partners Support Program


Exhibit 5 - Distributor Inventory Terms


Exhibit 6 - Local Country/Local Region Reseller Activation Process


TERRITORY:


The assigned territory where Distributor is to concentrate its sales and marketing activity is to be Implemented pursuant to the country activation process, Exhibit 6.


NOTICES:


All notices under this Agreement shall be sent by prepaid registered mail return receipt requested, telefax or courier service, to the following addresses:


DISTRIBUTOR SUBSIDIARY OF DISTRIBUTOR BAY COPY TO: Computer 2000 AG (Holding) As appropriate Bay Networks, Inc. Bay Networks EMEA Wolfratshauser Strasse 84 8 Federal Street 26 Allee Pierre Ziller 81379 Munich, Germany Billerica, MA 01820, USA 06560 Valbonne, France Attention: Contracts Attention: Contracts Attention: Contracts


HOLDING AND BAY ACKNOWLEDGE THAT EACH HAS READ THIS NON-EXCLUSIVE AGREEMENT AND THE EXHIBITS INCLUDED WITH THIS AGREEMENT, UNDERSTANDS THEM AND AGREES THAT BAY AND DISTRIBUTOR ARE BOUND BY THE TERMS AND CONDITIONS OF THIS AGREEMENT AND THE EXHIBITS. THE PARTIES FURTHER AGREE THAT THIS AGREEMENT AND ITS EXHIBITS CONSTITUTE THE ENTIRE AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO ITS SUBJECT MATTER AND SUPERSEDE ALL PRIOR PROPOSALS, NEGOTIATIONS, AND COMMUNICATIONS, ORAL OR WRITTEN BETWEEN THE PARTIES OR THEIR REPRESENTATIVES. DEVIATIONS TO THIS AGREEMENT SHALL ONLY BE BINDING UPON WRITTEN MUTUAL AGREEMENT.


AGREED: AGREED:


COMPUTER 2000 AG (HOLDING) BAY NETWORKS, INC.


BY:_______________________________ BY:________________________________
(authorized signature) (authorized signature)


Bay Networks Agreement for C2000 (Rev. 9/27/95)


Name ___________________________ Name________________________________
(typed or printed) (typed or printed) Title __________________________ Title ______________________________


Date ___________________________ Date _______________________________


Bay Networks Agreement for C2000 (Rev. 9/22/95)


EXHIBIT 1 - DISTRIBUTOR PURCHASE AND LICENSE TERMS


1. DEFINITIONS


"End Users" means the third party customers to which Distributor's Resellers resell or relicense Products and which are intended as the ultimate users of the Products.


"Hardware" means equipment sold to Distributor by Bay hereunder, as listed in the Price List.


"Price List" means Bay's prevailing Price List for Products and/or Services as the context requires.


"Product(s)" means Hardware and/or Software as the context requires.


"Services" means the second level support services purchased by Distributor and provided by Bay in accordance with the Bay Networks Support Services Program, Exhibit 4 attached.


"Software" means the software licensed by Bay to Distributor hereunder, as listed in the Price List, and including the Software Documentation and any revisions and updates to the software issued by Bay.


"Software Documentation" means the Software user manual and information provided with each copy of the Software by Bay.


"Territory" means those and only those country(ies) or portion(s) of the country(ies) as detailed on the front page of the Agreement and defined in the country activation document where the Reseller may actively market and resell the Products.


"Resellers" means third party value added reseller channels of distribution to which Distributor resells or relicenses Products.


2. APPOINTMENT


2.1 Subject to Distributor's performance of its obligations and
responsibilities set out in this Agreement Bay appoints Distributor as
a non-exclusive distributor of Bay's Products and Services for resale
or relicense to Resellers that achieve the qualifying designation in
the Territory. It is the Resellers' role to furnish value added network
products and/or services to End Users and the Distributor's role to
qualify, appoint and manage its Reseller channels.


2.2 The Agreement is in effect for two (2) years from the Effective Date.
The Agreement may renew for an additional one (1) year term(s), but
only upon the prior written mutual agreement of the parties.


Bay Networks Agreement for C2000 (Rev. 9/22/95)


3. DISTRIBUTOR CERTIFICATION


3.1 Distributor hereby certifies and agrees that for the duration of the
Agreement:


3.1.1 Distributor shall sell Products and Services only to Resellers
that meet minimum technical and quality criteria. These
generally shall accord with Exhibit 3 attached and with
Distributor's own Reseller agreements save that Product Groups
5A and 5B can only be resold to Enterprise Solution Partners
in accordance with the Bay Partner Alliance Program;


3.1.2 Distributor may resell or relicense Products to Resellers in
the applicable country or countries, or regions of such
countries that make up Distributor's authorized Territory as
set out in this Agreement, however unsolicited orders from
outside the Territory may be accepted by Distributor provided
that the Products will be supported and delivered outside the
Territory at the Distributor's expense;


3.2 Distributor's discounts as set out in Distributor Discount Terms,
Exhibit 2 attached, are conditional upon Distributor's continuing
compliance with its certification as per Section 3.1 above, and
Distributor's resale or relicensing of Products in material breach of
that certification may lead to suspension of shipments to Distributor
and may require Distributor's refund of the discount to Bay.


3.3 Distributor shall carry at all times an inventory of Products
sufficient to assure 'off-the-shelf' delivery commensurate with market
demand.


3.4 Distributor shall maintain a separate business entity to manage and
appoint Resellers, separate from any direct sales efforts of the
Distributor.


3.5 Distributor shall maintain a technical manager to assist Resellers with
networking information and Product information.


3.6 Distributor shall maintain a business manager to assure contract terms
are met, proposal information is available and other administrative
management efforts are satisfied, including liaison with Bay and
reporting to Bay on the status of Resellers, the market and competitive
activity.


3.7 Distributor acknowledges that Clause 3.1.1 above, Exhibit 3 and the Bay
Networks Partner Alliance Program categorize the Products and identify
specific requirements that qualify Distributor and Resellers to resell
and relicense each such category. Distributor agrees to abide by the
qualification process and criteria detailed in the Bay Networks Partner
Alliance Program and Exhibit 3. Distributor also acknowledges that the
qualification criteria are subject to change as the Products' technical
requirements evolve. The change(s) will be effective upon receipt of
notice from BAY.


3.8 Distributor shall disclose to Bay all products from competitive
manufacturers carried by Distributor and shall advise Bay of any new
competitive Products that it may add to its portfolio.


3.9 Upon Bay's request, Distributor shall furnish Bay with such reasonable
records and reports as shall allow Bay to conduct a review of
Distributor's activities under the Agreement and shall submit to Bay
forecasts of Distributor's projected purchases under the Agreement in a
format to be agreed between the parties.


Bay Networks Agreement for C2000 (Rev. 9/22/95)


4. PURCHASES


4.1 Distributor may purchase Hardware, license Software, and purchase
Services listed in the qualified portion(s) of the Price List by
placing orders under the Agreement subject to acceptance by Bay.
Distributor and its Resellers may purchase and resell only those
categories of Products based on Distributor's and applicable Resellers
achieving the qualifying designation under the Bay Networks Partner
Alliance Program in each territory.


4.2 Bay may refuse to accept new orders or to furnish previously ordered
Products or Services due to Distributor's failure to comply with any
material term of the Agreement, including, but not limited to meeting
the credit requirements of Bay, and failure to furnish timely records,
reports or other information as required by the Agreement, subject to
Bay having first given the Distributor written notice detailing the
failure and requiring the Distributor to make the failure good within
the thirty days following


4.3 List prices can change at any time, provided Distributor is given
thirty (30) days written notice of any price increase. In the event of
a list price increase, Bay honors the list price in effect when the
Distributor's order is accepted by Bay. In the event of a list price
decrease for Products, the new decreased price applies to such Products
that are shipped by Bay to Distributor on or after the effective date
of the list price decrease.


4.4 Bay can add to or delete from the Price List Products and Services at
any time provided Distributor is given thirty (30) days' written notice
of any deletions.


5. ORDER PLACEMENT, ORDERS


5.1 Distributor agrees that each order placed with Bay is placed under the
terms of the Agreement. No order will be effective until accepted by
Bay's acknowledgment which shall be issued within five working days of
receipt by Bay of the order. The terms of the Agreement govern all
orders regardless of any varying terms in Distributor's order.
Distributor shall have the right to cancel an open order or individual
line items of an open order at any time before actual shipment if Bay
advises that it cannot meet its acknowledged delivery dates and
Distributor's Reseller in consequence cancels its order.


5.2 Orders, which may be submitted by telefax, must be signed by an
authorized official of Distributor and need to specify;


(a) The number of this Agreement;


(b) Distributor's Purchase Order number;


(c) Products and/or Services and descriptions;


(d) Quantities;


(e) Purchase price;


(f) Tax status, including exemption certificate number if tax
exempt;


(g) Requested delivery date(s);


(h) Preferred shipping method; and


(i) Exact "Bill to" and "Ship to" addresses.


Bay Networks Agreement for C2000 (Rev. 9/22/95)


5.3 Orders for router and bridging products are to be sent to:


Bay Networks, Inc.
8 Federal Street
Billerica, M A 01821, U.S.A.
Attention: Order Administration
Telefax #: +1 508 436-3444


5.4 Orders for hub and switching products are to be sent to:


Bay Networks, Inc.
4401 Great America Parkway
P.O. Box 58185
Santa Clara, CA 95052-8185, U.S.A.
Telefax #: +1 408 988-8544


6. PRICES, TAXES, COSTS, PAYMENT


6.1 PURCHASE PRICE. The purchase price for the Products sold or licensed by
Bay to Distributor is determined by applying the discount percentages
specified in Distributor Discount Terms to the list price of the
Product or Service found in the Price List. All Product prices cover
delivery to a carrier at Bay's facilities, generally in the U.S.A..
Distributor has the right to determine the carrier.


Distributor shall at its own discretion establish the prices, terms and
conditions (incorporating appropriate software license terms) at which
it resells the products to its Resellers. Bay shall have no control
over Distributor's or its Resellers' prices.


6.2 TAXES. Prices, service charges and license fees do not include any
sales, use, value added, import and/or any other taxes or duties,
however designated, except for taxes on Bay's net income. All such
taxes or duties shall be for the account of Distributor and any such
taxes or duties required to be paid or collected by Bay shall be paid
by Distributor to Bay.


6.3 COSTS. Distributor agrees to pay transportation costs of shipment of
the Products.


6.4 PAYMENT. Subject to initial and continuing credit approval by Bay,
payment is due [*] from the date of Bay's invoice. Payment not received
by Bay when due may be subject to a late payment charge of [*] from the
original due date or the highest amount permitted by law, whichever is
less. Distributor agrees to complete and submit an Application for
Credit as required by Bay. Distributor agrees that the information
contained in the Application for Credit forms will be updated as
changes occur, or in response to a request from Bay.


7. SHIPMENT, CHANGES, TITLE, RISK OF LOSS


7.1 SHIPMENT. Bay ships Products by a method and carrier selected by Bay
unless otherwise instructed in Distributor's order. Bay will ship
freight collect if so instructed on Distributor's order.


7.2 CHANGES. Distributor cannot cancel or reschedule any order in whole or
in part fifteen (15) days or less prior to the acknowledged delivery
date or after delivery.


Bay Networks Agreement for C2000 (Rev. 9/22/95)


7.3 RETURNS. Products with defects covered by the warranty may be returned
for repair under the warranty. Distributor agrees to first obtain from
Bay the appropriate return material authorization number ("RMA #") and
return the Product within ten (10) days after receiving the RMA #.


7.4 TITLE, RISK OF LOSS. Risk of loss or damage in all Products shall pass
to Distributor at the airport of entry to the country specified on
Distributor's order. Title to Hardware shall pass to Distributor upon
payment in full, Bay and its licensors retain all title and ownership
of the Software and documentation, including any revisions.


8. WARRANTIES


8.1 HARDWARE WARRANTY. For each specific Product, the warranty period will
be as set out in the Price List. Bay warrants to Distributor that the
Hardware will be free from defects in workmanship and materials for its
respective warranty period. Where the warranty period is shown in the
Price List as being [*], respectively, after the date of shipment from
Distributor to the End User. Distributor's exclusive remedy, and Bay's
sole obligation and liability, is that Bay will either (a) repair or
replace any item of Product that fails during the warranty period
because of a defect in workmanship or material, or (b) if Bay is unable
to repair or replace such Product within a reasonable period, refund to
Distributor the purchase price of the defective Product. All replaced
or refunded Product or parts shall become the property of Bay.


8.2 SOFTWARE WARRANTY. The warranty period may vary depending on the
Software licensed. For Software furnished under Bay's standard software
license terms, Bay warrants that each item of Software, as delivered or
updated by Bay and properly installed and operated on the Hardware or
other equipment it is licensed for, will function substantially as
described in its then-current Software Documentation for its respective
warranty period. If any item of Software fails so to perform during its
warranty period, as the sole remedy Bay will in its discretion provide
a suitable "fix", "patch" or "workaround" for the problem, which may be
included in a future revision or upgrade of the Software. The warranty
for software furnished with Other Licenses, as hereinafter defined, may
vary.


8.3 SERVICE WARRANTY. Bay warrants to Distributor that Services will be
performed in a professional and workmanlike manner.


8.4 LIMITATIONS. Bay does not warrant that any item of Software is
error-free or that its use will be uninterrupted. Bay is not obligated
to remedy any Software defect which cannot be reproduced in the latest
version of the Software, but notwithstanding this provision Bay will
ensure that the End User receives a free of charge "fix", "patch" or
"workaround" for any warranty problem encountered in the Software. The
warranty in this section titled WARRANTIES does not apply to any
Product which has been (i) altered, except by Bay or in accordance with
its written instructions, or (ii) used in conjunction with another's
product resulting in the defect, or (iii) damaged by improper
environment, abuse, misuse, accident or negligence. Replacement parts
furnished under this warranty may be refurbished or contain refurbished
components.


Bay Networks Agreement for C2000 (Rev. 9/22/95)


THE FOREGOING WARRANTIES AND LIMITATIONS ARE EXCLUSIVE REMEDIES AND ARE IN LIEU OF ALL OTHER WARRANTIES EXPRESS OR IMPLIED, INCLUDING WITHOUT ANY LIMITATION WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. ANY PRODUCT THAT MAY BE FURNISHED BY BAY WHICH IS NOT LISTED IN THE PRICE LIST OR IS NOTED IN THE PRICE LIST "AS IS" IS FURNISHED "AS IS".


9. SOFTWARE LICENSES


9.1 BAY'S STANDARD SOFTWARE LICENSE. Subject to the terms below, Bay grants
to Distributor a personal, nontransferable, nonexclusive license to use
one copy of the Software listed in Distributor's order, together with
its corresponding Software Documentation, provided that Distributor has
paid Bay the applicable license fee(s) for the Software.


9.2 OTHER SOFTWARE LICENSES. Other software license terms ("Other
Licenses") may apply for some Software products available from Bay. The
additional terms of the Other Licenses are set out in the Price List,
within the Software Documentation, or as a separate written license
included with the applicable Software.


9.3 LIMITATIONS. Distributor may modify Software (but not firmware), or
combine it with other software, but only to the extent permitted by the
Software Documentation and subject to the provision that those portions
of the resulting software which incorporate Software are subject to the
restrictions of this software license. Software that is modified by
Distributor, its Resellers or End Users is not covered by Bay's
warranty. Distributor, its Resellers or End Users may not permit any
item of Software, related modifications, or Software Documentation to
be disclosed to or used by any person other than Distributor's or its
End Users' employees or contractors, or with any equipment other than
Hardware or equipment for which it is licensed, without Bay's prior
written permission. Distributor, its Resellers or End Users may not
duplicate any portion of the Software except for archival purposes or
for installation purposes as expressly described by the Software
Documentation, and agrees to duplicate Bay's proprietary rights notices
on any such copy. Distributor shall not, and shall not allow its
Resellers and End Users to reverse assemble, reverse compile, or in any
way reverse engineer the Software except as specified in the Software
Directive enacted by the Council of European Communities Directive
dated 14 May 1991 for interoperability purposes. Distributor shall
notify Bay of any such intended examination of the Software and Bay may
provide support and assistance.


10. RIGHT TO DISTRIBUTE SOFTWARE LICENSES


10.1 Subject to the terms below, Bay grants to Distributor a
nontransferable, non-exclusive right to distribute Software Licenses to
its Resellers and further grants Distributor a nontransferable,
non-exclusive right to authorize its Resellers to distribute Software
Licenses to End Users.


10.2 The Software and Software Documentation are protected under copyright
laws. The Software Licenses granted by Bay are not a sale. Bay and its
licensors retain all title and ownership of the Software and
documentation, including any revisions. All copyright notices must be
reproduced and included with any copy of any portion of the Software or
Software Documentation. Distributor agrees not to translate, nor allow
its Resellers or End Users to translate any portion of the Software or
associated documentation into any other format or language without the
prior written consent of Bay. Except as specifically


Bay Networks Agreement for C2000 (Rev. 9/22/95)


provided elsewhere in the Agreement, Distributor may not grant its
right to distribute or transfer Software Licenses to any third party.


10.3 In connection with any proposals to and agreements with government
entities, Distributor shall take all appropriate steps to ensure that
Bay's proprietary rights receive the maximum protection available from
such government entity for commercial computer software developed at
private expense.


10.4 All copies of the Software distributed by Distributor or its Resellers
must be accompanied by the Bay Networks, Inc. Software License
Agreement. In all jurisdictions where an enforceable copyright covering
the computer programs of the Software does not exist, the Software must
be accompanied by a written software license agreement, signed by the
End User, that is no less restrictive than the terms of the Bay
Networks, Inc. Software License Agreement. Bay does not undertake to
inform Distributor of the jurisdictions where such enforceable
copyright exists.


10.5 Distributor may distribute Software Licenses through its
Resellers only under a written agreement on terms no less restrictive
than the terms of the SOFTWARE LICENSES and RIGHT TO DISTRIBUTE
SOFTWARE LICENSES provisions of the Agreement.


11. TRADEMARKS AND TRADE NAMES


11.1 In the advertising and promotion of the Products, Distributor agrees to
use Bay's regular trade names and trademarks (the "Trademarks"). For
this purpose, Bay grants Distributor a non-exclusive, royalty-free,
limited license to use Bay's Trademarks, provided that Distributor
displays the symbol "TM" or"(R)" adjacent to each use of a Trademark
the first time a Trademark is used in a particular context, or displays
such other symbols and notices as may be prescribed by Bay.


11.2 Distributor acknowledges and agrees that Bay and its suppliers are the
exclusive owners of the Trademarks. The use of the Trademarks by
Distributor does not convey to Distributor any right, title or interest
in or to the Trademarks. Distributor agrees that neither it nor its
affiliates will register any Trademark in any jurisdiction unless
expressly approved by Bay in advance and in writing, and at a minimum
such registration is made on behalf and for the benefit of Bay.


11.3 In order to assure proper use and protection of Bay's Trademarks,
Distributor agrees to provide written notification to Bay if
Distributor purchases, or is offered for purchase, an ...