DRAFT — FOR DISCUSSION PURPOSES ONLY — FEBRUARY 12, 2024
PRIVILEGED & CONFIDENTIAL — ATTORNEY WORK PRODUCT
Prepared by Calderwood & Harkness LLP 801 South Figueroa Street, Suite 4200 Los Angeles, CA 90017
Matter No. 1008-00010
Prepared on behalf of Lumos Analytics Inc.
Circulated to Kessler Hartmann Rechtsanwälte PartG mbB (counsel to Meridian Data Solutions GmbH)
CHANNEL RESELLER PROGRAM AGREEMENT
This Channel Reseller Program Agreement (this "Agreement") is entered into as of [●], 2024 (the "Execution Date"), by and between:
Lumos Analytics Inc., a corporation organized and existing under the laws of the State of Delaware, with its principal place of business at 4700 Sandhill Road, Suite 300, Palo Alto, California 94304 (hereinafter referred to as "Licensor" or "Lumos");
and
Meridian Data Solutions GmbH, a Gesellschaft mit beschränkter Haftung organized under the laws of the Federal Republic of Germany, registered with the Amtsgericht München under HRB 274581, with its registered office at Leopoldstraße 78, 80802 München, Germany (hereinafter referred to as "Reseller" or "Meridian").
Lumos and Meridian are each individually referred to herein as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, Lumos is the developer, owner, and licensor of the Lumos Prism™ AI-powered financial analytics and risk-modeling software-as-a-service platform (the "Platform" or "Licensed Product"), which provides enterprise-grade financial analytics, predictive modeling, and risk assessment capabilities to financial institutions, corporations, and other organizations worldwide;
WHEREAS, Lumos desires to expand the distribution and market penetration of the Licensed Product across the Europe, Middle East, and Africa region (the "EMEA Territory") through a network of qualified channel reseller partners with deep regional expertise, established customer relationships, and the technical and commercial capabilities necessary to support enterprise software deployments in such region;
WHEREAS, Meridian is a leading technology channel distribution company operating across the EMEA region, serving as an authorized reseller and value-added distributor for enterprise software vendors, with demonstrated experience in the distribution of SaaS and cloud-based solutions to financial services, insurance, telecommunications, and other regulated industries, and with annual revenues of approximately €312 million for the fiscal year ended December 31, 2023;
WHEREAS, Lumos desires to appoint Meridian as a non-exclusive authorized reseller of Lumos Prism™ SaaS subscriptions within the EMEA Territory, and Meridian desires to accept such appointment, subject to the terms and conditions set forth herein;
WHEREAS, the Parties wish to set forth the terms governing Meridian's resale of the Licensed Product, including pricing, minimum annual commitments, intellectual property licensing, data protection, cross-border data transfer mechanisms, service levels, and related matters; and
NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations, and warranties set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
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ARTICLE 1 — DEFINITIONS
As used in this Agreement, the following terms shall have the meanings ascribed to them below. Capitalized terms used but not defined in this Article 1 shall have the meanings assigned to them elsewhere in this Agreement.
1.1 "Affiliate" means, with respect to either Party, any entity that, directly or indirectly, controls, is controlled by, or is under common control with such Party, where "control" means the direct or indirect ownership of more than fifty percent (50%) of the voting securities or equivalent ownership interest of such entity, or the power to direct or cause the direction of the management and policies of such entity, whether through ownership of voting securities, by contract, or otherwise.
1.2 "Agreement" means this Channel Reseller Program Agreement, together with all Exhibits, Schedules, and annexes attached hereto and incorporated herein by reference, as the same may be amended, supplemented, or modified from time to time in accordance with Section 16.3.
1.3 "Annualized Contract Value" or "ACV" means the average annual value of the Total Contract Value over the Initial Term, which is equal to Six Million United States Dollars ($6,000,000) per year (i.e., $30,000,000 divided by five (5) years).
1.4 "Approved Sub-Distributor" means any sub-distributor that has received Lumos's prior written consent to distribute the Licensed Product within all or a portion of the EMEA Territory, in accordance with Section 2.4 of this Agreement, including any sub-distributor listed in Exhibit B as of the Effective Date.
1.5 "Brand Guidelines" means the trademark and brand usage guidelines established by Lumos for the use of the Lumos Marks, as set forth in Exhibit D attached hereto, and as may be updated by Lumos from time to time upon reasonable written notice to Reseller.
1.6 "Confidential Information" means all non-public information disclosed by either Party (the "Disclosing Party") to the other Party (the "Receiving Party"), whether orally, in writing, electronically, or by any other means, that is designated as confidential, proprietary, or the functional equivalent thereof at the time of disclosure, or that, given the nature of the information and the circumstances of disclosure, would reasonably be understood by the Receiving Party to be confidential. Without limiting the generality of the foregoing, Confidential Information includes: (a) trade secrets, inventions, know-how, algorithms, and proprietary methodologies; (b) source code, object code, software architecture, and technical documentation; (c) business plans, strategies, forecasts, and financial projections; (d) customer and prospect lists, pricing information, and sales data; (e) employee and personnel information; (f) the terms and conditions of this Agreement (including the financial terms set forth herein); and (g) any information derived from any of the foregoing.
1.7 "Data Processing Agreement" or "DPA" means the data processing agreement between the Parties, attached hereto as Exhibit C and incorporated herein by reference, which sets forth the Parties' respective obligations with respect to the processing of Personal Data in connection with this Agreement.
1.8 "Effective Date" means April 1, 2024, which is the date on which the rights and obligations of the Parties under this Agreement (other than those that expressly take effect on the Execution Date) shall commence.
1.9 "EMEA Territory" or "Territory" means all countries and territories within Europe (including, without limitation, all member states of the European Union, the member states of the European Economic Area, the United Kingdom, and Switzerland), the Middle East (including, without limitation, the United Arab Emirates, Saudi Arabia, Qatar, Bahrain, Kuwait, Oman, Israel, Jordan, Lebanon, and Turkey), and Africa (including, without limitation, South Africa, Nigeria, Kenya, Egypt, Morocco, Ghana, and all other countries on the African continent), as further described in Exhibit B attached hereto, but excluding the Restricted Territories.
1.10 "End User" means a third-party customer, enterprise, or organization that purchases or otherwise obtains a subscription to the Licensed Product through Reseller or an Approved Sub-Distributor in accordance with this Agreement.
1.11 "End User Subscription Agreement" or "EUSA" means the subscription agreement entered into directly between Lumos and an End User, or a form thereof approved by Lumos in writing, governing the End User's access to and use of the Licensed Product.
1.12 "Escrow Agent" means Evergreen Trust Company, N.A., a national trust company with offices at 400 South Hope Street, Suite 1100, Los Angeles, California 90071, or any successor escrow agent designated in accordance with the Escrow Agreement.
1.13 "Escrow Agreement" means the escrow agreement to be entered into among Lumos, Meridian, and the Escrow Agent on or about the Effective Date, governing the deposit, maintenance, and release of the Holdback Amounts.
1.14 "Execution Date" means the date first written above in the preamble to this Agreement.
1.15 "Exhibit" means each exhibit, schedule, annex, or appendix attached to this Agreement and incorporated herein by reference.
1.16 "Feedback" means any suggestions, ideas, enhancement requests, recommendations, comments, corrections, or other feedback provided by Reseller, any Approved Sub-Distributor, or any End User regarding the Licensed Product, including with respect to functionality, performance, user experience, features, interoperability, or any other aspect thereof.
1.17 "GDPR" means Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data (General Data Protection Regulation), as amended, supplemented, or replaced from time to time.
1.18 "Holdback Amount" means, with respect to each quarterly payment made by Reseller to Lumos under this Agreement, an amount equal to five percent (5%) of such quarterly payment, which shall be withheld and deposited into the escrow account maintained by the Escrow Agent pursuant to Section 5.8 and the Escrow Agreement.
1.19 "Indemnification Cap" means Fifteen Million United States Dollars ($15,000,000), which is equal to fifty percent (50%) of the Total Contract Value, representing the maximum aggregate indemnification liability of each Party under Article 9, subject to the exceptions set forth in Section 9.3.
1.20 "Initial Term" means the five (5)-year period commencing on the Effective Date (April 1, 2024) and ending on March 31, 2029, unless earlier terminated in accordance with the provisions of Article 12.
1.21 "Late Payment Interest Rate" means one and one-half percent (1.5%) per month (eighteen percent (18%) per annum), calculated as simple interest on any amount that remains unpaid after the applicable due date.
1.22 "Licensed Product" means the Lumos Prism™ AI-powered financial analytics and risk-modeling software-as-a-service platform, including all modules, features, updates, upgrades, patches, enhancements, and documentation made generally available by Lumos to its customers during the Term, as further described in Exhibit A attached hereto.
1.23 "List Price" means Lumos's published EMEA list prices for the Licensed Product, as set forth in Exhibit A attached hereto, and as may be updated by Lumos from time to time in accordance with the terms of this Agreement.
1.24 "Lumos Marks" means the trademarks, service marks, trade names, logos, symbols, domain names, and other designations of origin owned, registered, or used by Lumos, including without limitation the mark "Lumos Prism™," and all goodwill associated therewith.
1.25 "Minimum Annual Commitment" or "MAC" means the minimum annual purchase commitment that Reseller is obligated to meet during each contract year of the Initial Term, as set forth in Section 5.3 and Exhibit F attached hereto.
1.26 "OFAC" means the U.S. Department of the Treasury's Office of Foreign Assets Control, or any successor agency or authority performing substantially similar functions.
1.27 "Personal Data" shall have the meaning ascribed to the term "personal data" under Article 4(1) of the GDPR, and shall also include "personal data" as defined under the UK GDPR, to the extent applicable.
1.28 "Renewal Term" means each successive one (1)-year period following the expiration of the Initial Term during which this Agreement remains in effect in accordance with Section 12.2.
1.29 "Reseller discount" means a discount of thirty percent (30%) off the applicable List Price for the Licensed Product, as further described in Section 5.1 and Exhibit A.
1.30 "Restricted Territories" means Cuba, the Islamic Republic of Iran, the Democratic People's Republic of Korea (North Korea), the Syrian Arab Republic, and the Crimea region, the so-called Donetsk People's Republic, and the so-called Luhansk People's Republic of Ukraine, and such other countries, territories, or regions as may be designated by OFAC, the European Union, or other applicable governmental authorities as subject to comprehensive sanctions from time to time during the Term.
1.31 "SLA" means the Service Level Agreement attached hereto as Exhibit E and incorporated herein by reference, which sets forth the performance standards, uptime commitments, support obligations, service credit methodology, and escalation procedures applicable to the Licensed Product.
1.32 "Standard Contractual Clauses" or "SCCs" means the standard contractual clauses for the transfer of personal data to third countries adopted by the European Commission pursuant to Commission Implementing Decision (EU) 2021/914 of 4 June 2021, as incorporated into the DPA (Module Two — Controller-to-Processor), and any successor or replacement clauses adopted by the European Commission or recognized as adequate under applicable data protection laws.
1.33 "Sub-Processor" means any third-party data processor engaged by Lumos (or by a sub-processor of Lumos) to process Personal Data on behalf of a controller in connection with the provision of the Licensed Product, as further described in the DPA.
1.34 "Term" means, collectively, the Initial Term and any Renewal Terms during which this Agreement remains in effect.
1.35 "Total Contract Value" or "TCV" means Thirty Million United States Dollars ($30,000,000), which represents the aggregate value of the Minimum Annual Commitments over the Initial Term.
1.36 "UK GDPR" means the United Kingdom General Data Protection Regulation, as defined in Section 3(10) of the UK Data Protection Act 2018, and as amended, supplemented, or replaced from time to time, together with any subordinate legislation, regulatory guidance, or codes of practice issued thereunder.
ARTICLE 2 — APPOINTMENT AND SCOPE
2.1 Appointment. Lumos hereby appoints Meridian, and Meridian hereby accepts such appointment, as a non-exclusive authorized reseller of the Licensed Product within the EMEA Territory during the Term, subject to and in accordance with the terms and conditions of this Agreement. This appointment authorizes Reseller to market, promote, solicit orders for, and resell subscriptions to the Licensed Product to prospective End Users within the EMEA Territory. Reseller's appointment shall be effective as of the Effective Date and shall continue throughout the Term unless earlier terminated in accordance with Article 12. For the avoidance of doubt, this appointment does not grant Reseller any right to access, host, modify, sublicense, or otherwise exploit the Licensed Product except as expressly set forth herein.
2.2 Non-Exclusivity. The appointment granted under Section 2.1 is non-exclusive. Lumos expressly retains the right, at all times during the Term, to: (a) appoint one or more additional resellers, distributors, channel partners, value-added resellers, systems integrators, or other intermediaries within the EMEA Territory, without limitation as to the number, identity, or scope of such appointments; (b) sell, license, or otherwise distribute the Licensed Product directly to End Users within the EMEA Territory through Lumos's own sales force, its Affiliates, or any other distribution channel; and (c) engage in any other marketing, promotional, distribution, or commercial activities with respect to the Licensed Product within or outside the EMEA Territory as Lumos deems appropriate in its sole discretion, in each case without restriction, obligation, or liability to Reseller. Reseller acknowledges and agrees that Lumos's exercise of any of the foregoing rights shall not give rise to any claim by Reseller for compensation, damages, or other relief, whether under this Agreement or otherwise.
2.3 Territory Restrictions. Reseller shall market, promote, solicit orders for, and resell the Licensed Product only within the EMEA Territory and only to End Users located within the EMEA Territory. Reseller shall not actively solicit, target, or sell to customers, prospects, or other persons or entities located outside the EMEA Territory. Without limiting the foregoing, Reseller shall not, directly or indirectly, resell, export, re-export, or transfer the Licensed Product, or any subscription thereto, to any person or entity located in any Restricted Territory. Reseller shall implement commercially reasonable measures to screen prospective End Users and ensure compliance with this Section 2.3. In the event Reseller receives an unsolicited inquiry from a prospective customer located outside the EMEA Territory, Reseller shall promptly refer such inquiry to Lumos and shall not independently pursue such opportunity.
2.4 Sub-Distribution Rights. Reseller may appoint sub-distributors to assist in the distribution, marketing, promotion, and resale of the Licensed Product within the EMEA Territory only with the prior written consent of Lumos, which consent may be withheld, conditioned, or revoked in Lumos's sole and absolute discretion. Any sub-distributor so approved by Lumos shall be deemed an "Approved Sub-Distributor" for purposes of this Agreement. As of the Effective Date, the following entities have been pre-approved by Lumos as Approved Sub-Distributors, and are authorized to distribute the Licensed Product within the sub-territories set forth opposite their respective names:
(a) Meridian Data Solutions UK Ltd, a private limited company incorporated in England and Wales (Companies House No. 12847391), with its registered office at 14 Fenchurch Place, London EC3M 5AJ, United Kingdom — authorized to distribute the Licensed Product within the United Kingdom and Ireland.
(b) Meridian Data Solutions SARL, a société à responsabilité limitée organized under the laws of the French Republic (SIREN 912 483 057), with its registered office at 27 Rue de la Boétie, 75008 Paris, France — authorized to distribute the Licensed Product within France, Belgium, Luxembourg, and the French-speaking cantons of Switzerland.
A complete list of Approved Sub-Distributors and their respective authorized sub-territories is set forth in Exhibit B attached hereto, and shall be updated from time to time as additional sub-distributors are approved or existing approvals are modified or revoked in accordance with this Section 2.4.
2.5 Sub-Distributor Obligations. Each Approved Sub-Distributor shall, prior to commencing any distribution or resale activities with respect to the Licensed Product, execute a written sub-distribution agreement with Reseller on terms and conditions that are no less protective of Lumos's interests, rights, and intellectual property than those set forth in this Agreement. Without limiting the foregoing, each such sub-distribution agreement shall include provisions addressing: (a) compliance with the Brand Guidelines; (b) intellectual property ownership and protection; (c) territory restrictions and restrictions on resale into Restricted Territories; (d) data protection and privacy obligations consistent with the DPA; (e) export control, sanctions, and anti-corruption compliance; (f) confidentiality obligations at least as restrictive as those set forth in Article 10; and (g) Lumos's right to audit the Approved Sub-Distributor's records and activities. Reseller shall provide Lumos with a copy of each executed sub-distribution agreement within ten (10) business days following execution. Reseller shall remain fully liable and responsible for all acts, omissions, failures, and breaches of its Approved Sub-Distributors as if such acts, omissions, failures, and breaches were those of Reseller itself. The appointment of any Approved Sub-Distributor shall not relieve Reseller of any of its obligations under this Agreement.
2.6 No Modification or Reverse Engineering. Reseller shall not, and shall ensure that none of its Affiliates, Approved Sub-Distributors, employees, contractors, or agents shall: (a) modify, adapt, alter, translate, or create derivative works based on the Licensed Product or any component thereof; (b) reverse-engineer, decompile, disassemble, or otherwise attempt to derive the source code, object code, underlying algorithms, data structures, or ideas of the Licensed Product or any component thereof, except to the extent expressly permitted by applicable mandatory law (including Article 6 of Directive 2009/24/EC); (c) merge the Licensed Product or any component thereof with any other software, platform, or product; or (d) grant, authorize, or permit any End User, Approved Sub-Distributor, or other third party to do any of the foregoing. Any breach of this Section 2.6 shall constitute a material breach of this Agreement and shall entitle Lumos to exercise its rights under Section 12.4 and Section 12.5.
ARTICLE 3 — INTELLECTUAL PROPERTY
3.1 Ownership. As between the Parties, Lumos retains and shall retain all right, title, and interest in and to the Licensed Product, the Lumos Marks, all documentation, training materials, marketing materials created by or on behalf of Lumos, and all related intellectual property rights, including without limitation all patents, copyrights, trade secrets, trademarks, service marks, and any other proprietary rights of any kind or nature, whether registered or unregistered, throughout the world. Nothing in this Agreement shall be construed to transfer, convey, or assign to Reseller any ownership interest in Lumos's intellectual property, and Reseller hereby disclaims any such interest. All rights not expressly granted to Reseller under this Agreement are reserved to Lumos. Reseller acknowledges and agrees that the Licensed Product embodies valuable trade secrets and proprietary technology of Lumos and that Reseller's unauthorized use or disclosure of the Licensed Product or any component thereof would cause irreparable harm to Lumos for which monetary damages would be an inadequate remedy.
3.2 Trademark License. Subject to the terms and conditions of this Agreement, Lumos hereby grants to Reseller a limited, non-exclusive, non-transferable, non-sublicensable (except to Approved Sub-Distributors in accordance with Section 2.4), revocable license to use the Lumos Marks solely in connection with Reseller's authorized marketing, promotion, and resale of the Licensed Product within the EMEA Territory during the Term. Reseller's use of the Lumos Marks shall be in strict compliance with the Brand Guidelines set forth in Exhibit D, as updated by Lumos from time to time. Reseller shall not alter, modify, distort, or otherwise misuse the Lumos Marks or use the Lumos Marks in any manner that could diminish, tarnish, or dilute the reputation or goodwill associated therewith. All goodwill generated by Reseller's use of the Lumos Marks shall inure solely to the benefit of Lumos. Reseller shall not register, apply to register, or claim ownership of any trademark, service mark, trade name, domain name, social media account, or other designation that incorporates, is confusingly similar to, or is a derivative of any Lumos Mark, whether in the EMEA Territory or elsewhere.
3.3 Marketing Materials. Lumos shall provide Reseller with approved marketing collateral, sales presentations, product documentation, datasheets, case studies, and other marketing materials for use in connection with Reseller's authorized resale activities under this Agreement. Lumos shall make such materials available through a secure partner portal or such other mechanism as Lumos may designate. Reseller may create additional marketing materials, sales collateral, and promotional content incorporating the Lumos Marks, provided that all such materials shall be submitted to Lumos for prior written approval before publication, distribution, or use. Lumos shall review and respond to Reseller's requests for approval within fifteen (15) business days of receipt, and such approval shall not be unreasonably withheld, conditioned, or delayed. Any marketing materials created by Reseller that incorporate the Lumos Marks or descriptions of the Licensed Product shall be deemed works made for hire to the extent permitted by applicable law, and to the extent not so deemed, Reseller hereby assigns to Lumos all right, title, and interest in such materials.
3.4 Feedback License. Reseller hereby irrevocably assigns to Lumos all right, title, and interest in and to any Feedback provided by Reseller, its Affiliates, its Approved Sub-Distributors, or any End User to Lumos or Reseller in connection with the Licensed Product, including all intellectual property rights therein and thereto. Reseller agrees to take all actions and execute all documents reasonably requested by Lumos to perfect, evidence, or protect Lumos's ownership of such Feedback. To the extent that any such assignment is not legally effective under applicable law, Reseller hereby grants to Lumos a perpetual, irrevocable, worldwide, royalty-free, fully paid-up, unrestricted, non-exclusive license (with the right to sublicense through multiple tiers) to use, reproduce, modify, adapt, create derivative works from, distribute, publicly display, publicly perform, transmit, and otherwise exploit such Feedback in any manner and for any purpose, without attribution, accounting, or compensation to Reseller or any third party.
3.5 No Competing Products. [Reserved — This section is reserved for further discussion between the Parties. Lumos may propose a covenant restricting Reseller from marketing, promoting, or reselling directly competitive AI-powered financial analytics platforms within the EMEA Territory during the Term. The scope, duration, and exceptions of any such covenant will be subject to negotiation and compliance with applicable competition laws, including Article 101 TFEU and the VBER.]
3.6 IP Infringement Notification. Reseller shall promptly notify Lumos in writing of any actual or suspected infringement, misappropriation, dilution, or other unauthorized use of any of Lumos's intellectual property rights, including the Lumos Marks and the Licensed Product, that comes to Reseller's attention during the Term. Such notice shall include all information reasonably available to Reseller regarding the nature and scope of the alleged infringement, the identity of the alleged infringer, and any evidence of the infringement in Reseller's possession or control. Reseller shall cooperate fully with Lumos, at Lumos's expense, in connection with any enforcement action that Lumos may elect to pursue. Reseller shall not initiate any legal proceedings or take any enforcement action with respect to Lumos's intellectual property rights without Lumos's prior written consent.
ARTICLE 4 — RESELLER OBLIGATIONS
4.1 Marketing and Promotion. Reseller shall use commercially reasonable efforts to actively and continuously market, promote, and resell the Licensed Product throughout the EMEA Territory during the Term. Such efforts shall include, without limitation: (a) identifying and cultivating prospective End Users within the EMEA Territory; (b) conducting product demonstrations, webinars, and presentations for prospective End Users; (c) participating in industry events, conferences, and trade shows at which the Licensed Product may be exhibited, subject to coordination with Lumos; (d) developing and executing marketing campaigns targeting key industry verticals, including financial services, insurance, and corporate treasury; and (e) maintaining a dedicated section on Reseller's website and digital properties promoting the Licensed Product. All marketing and promotional activities shall be conducted in a manner consistent with the Brand Guidelines, Lumos's professional reputation, and the standards of a reputable enterprise software channel partner.
4.2 Sales Personnel. Reseller shall maintain a dedicated team of not fewer than eight (8) qualified sales and pre-sales technical personnel who are trained in the features, functionality, and use cases of the Licensed Product and who are capable of effectively demonstrating, positioning, and selling the Licensed Product to prospective End Users within the EMEA Territory. Lumos shall provide Reseller with reasonable training and enablement resources, including access to Lumos's partner training portal, product documentation, and such other training programs as Lumos may offer from time to time. Reseller shall ensure that its sales and technical personnel complete the Lumos Prism™ Certified Partner training program within sixty (60) days of the Effective Date, and Reseller shall cause any new sales personnel assigned to Licensed Product activities to complete such training within thirty (30) days of their assignment. The costs associated with Reseller's participation in training programs (including travel and accommodation expenses) shall be borne by Reseller.
4.3 Reporting. Reseller shall provide Lumos with comprehensive quarterly reports, delivered within fifteen (15) business days following the end of each calendar quarter, detailing: (a) the aggregate volume and value of Licensed Product subscriptions resold during the applicable quarter; (b) a summary of the pipeline of prospective End User opportunities, including the stage, estimated value, and anticipated close date of each opportunity; (c) information regarding each End User to which Licensed Product subscriptions were resold during the applicable quarter, including the End User's name, jurisdiction, industry vertical, subscription tier, and subscription value; (d) a summary of marketing and promotional activities conducted during the applicable quarter; and (e) such other information as Lumos may reasonably request from time to time. All reports shall be submitted in a format reasonably specified by Lumos. Reseller shall also make itself available for quarterly business review meetings (in person or by video conference) with Lumos's channel management team to discuss performance, pipeline, market conditions, competitive dynamics, and strategic planning.
4.4 Compliance. Reseller shall comply with all applicable laws, regulations, directives, rules, orders, and industry standards in connection with its activities under this Agreement, including without limitation: (a) all export control laws and regulations, including the U.S. Export Administration Regulations (EAR) (15 C.F.R. Parts 730–774), the EU Dual-Use Regulation (EU) 2021/821, and the export control laws of each country within the EMEA Territory in which Reseller operates; (b) all economic and trade sanctions laws and regulations, including those administered by OFAC, the European Union, the United Nations Security Council, and Her Majesty's Treasury of the United Kingdom; (c) all anti-corruption and anti-bribery laws, including the U.S. Foreign Corrupt Practices Act (FCPA) (15 U.S.C. §§ 78dd-1 et seq.), the UK Bribery Act 2010, and all local anti-corruption laws applicable in the EMEA Territory; (d) all data protection and privacy laws, including the GDPR, the UK GDPR, and all national implementing legislation; and (e) all consumer protection, competition, and unfair business practices laws applicable in the EMEA Territory.
4.5 Resale Pricing. Reseller shall have full and complete discretion to independently determine the prices, terms, and conditions at which it resells the Licensed Product to End Users. Lumos may, from time to time, provide Reseller with recommended resale prices or suggested retail prices for informational and reference purposes; however, any such recommendations are advisory and non-binding, and Reseller shall have no obligation to adhere to or follow such recommendations. Nothing in this Agreement shall be construed as establishing, mandating, or imposing any minimum or maximum resale price, and the Parties expressly confirm that this Agreement does not constitute an agreement on resale price maintenance or any other restriction prohibited by Article 101 of the Treaty on the Functioning of the European Union (TFEU) or the Vertical Block Exemption Regulation (EU) 2022/720 (VBER).
4.6 End User Agreements. Each End User that purchases a subscription to the Licensed Product through Reseller shall be required to execute an End User Subscription Agreement directly with Lumos (or on a form of subscription agreement that has been approved by Lumos in writing) prior to being granted access to the Licensed Product. Reseller shall facilitate the timely execution of such End User Subscription Agreements by providing prospective End Users with the current form of EUSA, collecting executed counterparts, and transmitting such counterparts to Lumos. Reseller shall not make any representations, warranties, or commitments to End Users that are inconsistent with or exceed those contained in the EUSA or this Agreement. Reseller acknowledges that the EUSA governs the End User's relationship with Lumos and that Reseller is not a party to the EUSA.
4.7 Records and Audit. Reseller shall maintain complete, accurate, and up-to-date books, records, and accounts relating to all of its resale activities under this Agreement, including records of all orders placed, invoices issued, payments received, End Users served, marketing activities conducted, and Approved Sub-Distributor activities, for a period of not less than five (5) years following the end of the contract year to which they relate. Lumos (or an independent third-party auditor designated by Lumos and reasonably acceptable to Reseller) shall have the right, upon not less than thirty (30) days' prior written notice, to inspect and audit Reseller's books, records, and accounts during normal business hours at Reseller's principal offices, for the purpose of verifying Reseller's compliance with its obligations under this Agreement, including its Minimum Annual Commitment and payment obligations. Such audits shall be conducted no more than once per calendar year, unless an audit reveals a material discrepancy (greater than five percent (5%) of the amounts owed), in which case Lumos shall have the right to conduct an additional audit at any time. If an audit reveals that Reseller has underpaid amounts owed to Lumos, Reseller shall promptly pay the deficiency, together with interest at the Late Payment Interest Rate from the date such amounts were originally due. If the underpayment exceeds five percent (5%) of the amounts owed for the audited period, Reseller shall also reimburse Lumos for the reasonable costs and expenses of the audit.
ARTICLE 5 — FINANCIAL TERMS
5.1 Reseller discount. Reseller shall purchase Licensed Product subscriptions from Lumos at a discount of thirty percent (30%) off the applicable List Price set forth in Exhibit A (the "Reseller discount"). The Reseller discount shall apply to all Licensed Product subscriptions purchased by Reseller during the Term, regardless of the subscription tier, volume, or End User. The Reseller discount shall be applied at the time of invoicing by Lumos. For the avoidance of doubt, the Reseller discount represents the sole compensation and margin available to Reseller under this Agreement, and no additional commissions, rebates, marketing development funds, or other incentive payments shall be payable by Lumos to Reseller, except as may be separately agreed in writing by the Parties.
5.2 Total Contract Value. The aggregate Total Contract Value of this Agreement over the Initial Term is Thirty Million United States Dollars ($30,000,000), representing the sum of all Minimum Annual Commitments across the five (5) contract years of the Initial Term, as set forth in Section 5.3 below. The Total Contract Value reflects the minimum aggregate purchase obligation of Reseller during the Initial Term and does not limit Reseller's ability to purchase Licensed Product subscriptions in excess of the Minimum Annual Commitments.
5.3 Minimum Annual Commitment (MAC). Reseller hereby commits to achieve the following Minimum Annual Commitments during each contract year of the Initial Term, as further detailed in Exhibit F attached hereto:
The Minimum Annual Commitments reflect the Parties' mutual expectation of increasing sales volume and market penetration over the Initial Term, taking into account the time required for Reseller to establish its go-to-market capabilities and customer pipeline for the Licensed Product within the EMEA Territory. All amounts in this Section 5.3 are stated at the net price payable by Reseller to Lumos (i.e., after application of the Reseller discount).
5.4 MAC Shortfall. If, at the end of any contract year during the Initial Term, Reseller's actual aggregate purchases of Licensed Product subscriptions fall below the applicable Minimum Annual Commitment for such contract year (calculated based on the net amounts actually invoiced and paid by Reseller to Lumos), Reseller shall pay to Lumos the difference between the applicable MAC and the actual purchase amount (the "Shortfall Payment") within thirty (30) days following the end of such contract year. Shortfall Payments shall be invoiced by Lumos promptly following the end of the applicable contract year and shall be payable in accordance with Section 5.5. For the avoidance of doubt, any purchases by Reseller in excess of the applicable MAC in any contract year shall not be credited against or offset the MAC for any subsequent contract year, unless otherwise agreed in writing by the Parties.
5.5 Payment Terms. All invoices issued by Lumos under this Agreement shall be payable within forty-five (45) days from the date of invoice (net 45). Payments shall be made in United States Dollars (USD) by wire transfer of immediately available funds to Lumos's designated bank account, as follows:
Bank: Pinnacle National Bank, N.A.
Address: 555 California Street, San Francisco, California 94104
Account Name: Lumos Analytics Inc. Account Number: [To be provided under separate cover] ABA Routing Number: [To be provided under separate cover] SWIFT Code: [To be provided under separate cover] Reference: Channel Reseller Program — Meridian Data Solutions GmbH
Lumos may designate an alternative bank account for the receipt of payments from time to time by providing Reseller with not less than thirty (30) days' prior written notice. All payments shall be made without deduction, setoff, or counterclaim, except as expressly provided in this Agreement.
5.6 Currency; FX Risk. All amounts payable under this Agreement are denominated in, and shall be paid in, United States Dollars (USD). Reseller acknowledges that it collects resale revenues from End Users in various local currencies within the EMEA Territory and that the conversion of such local currencies to USD may result in foreign exchange gains or losses. Reseller bears all foreign exchange risk, costs, and losses associated with the conversion of local currencies to USD for purposes of making payments under this Agreement. Lumos shall have no obligation to adjust any amounts payable hereunder on account of fluctuations in foreign exchange rates, and no currency fluctuation shall excuse or reduce Reseller's obligations under this Agreement, including its Minimum Annual Commitment obligations.
5.7 Late Payments. Any amounts due and payable under this Agreement that are not paid by Reseller when due shall bear interest at the Late Payment Interest Rate of one and one-half percent (1.5%) per month (eighteen percent (18%) per annum), calculated as simple interest, from the original due date until the date of actual payment in full. The assessment of late payment interest shall be in addition to, and not in limitation of, any other rights or remedies available to Lumos under this Agreement, at law, or in equity. In the event that Reseller fails to pay any undisputed amount within sixty (60) days after the applicable due date, Lumos shall have the right, in addition to its other remedies, to suspend Reseller's authorization to resell the Licensed Product until all outstanding amounts (including accrued interest) have been paid in full.
5.8 Escrow Holdback. Five percent (5%) of each quarterly payment made by Reseller under this Agreement shall be withheld and deposited into a segregated escrow account maintained by the Escrow Agent, Evergreen Trust Company, N.A., 400 South Hope Street, Suite 1100, Los Angeles, California 90071, pursuant to the terms and conditions of the Escrow Agreement. For purposes of illustration and not limitation, based on the Year 1 Minimum Annual Commitment of $4,500,000, the quarterly MAC payment is approximately $1,125,000, and the quarterly Holdback Amount is $56,250 (i.e., $1,125,000 × 5%). The Holdback Amounts shall be held in escrow and shall be available to satisfy any valid and enforceable indemnification claims asserted by either Party under Article 9, subject to the procedures and conditions set forth in the Escrow Agreement. Interest and earnings on the escrowed funds shall be allocated as specified in the Escrow Agreement. Any escrowed funds that have not been applied to satisfy indemnification claims or are not subject to any pending, unresolved, or disputed indemnification claims shall be released to Reseller twelve (12) months following the effective date of expiration or termination of this Agreement, net of any amounts applied to or reserved for pending or unresolved indemnification claims. The fees and expenses of the Escrow Agent shall be shared equally by the Parties.
5.9 Taxes. Each Party shall be solely responsible for all taxes imposed on its own income, capital, or franchise arising in connection with this Agreement (collectively, "Income Taxes"). Reseller shall be solely responsible for all value-added taxes (VAT), goods and services taxes (GST), sales taxes, use taxes, turnover taxes, and similar indirect taxes imposed on the resale of the Licensed Product to End Users in the EMEA Territory, regardless of whether such taxes are assessed against Reseller or Lumos, and Reseller shall indemnify and hold harmless Lumos from any liability with respect thereto. To the extent that any withholding taxes are required to be deducted or withheld from payments made by Reseller to Lumos under applicable law, such withholding taxes shall be borne exclusively by Reseller, and the amounts payable by Reseller to Lumos shall be made net of such withholding taxes (i.e., Reseller shall not be entitled to "gross up" amounts payable to compensate for such withholding). Reseller shall promptly provide Lumos with official tax receipts or other documentation evidencing the payment of any withheld taxes to the applicable tax authority. Each Party shall cooperate with the other Party, at the requesting Party's expense, to minimize the imposition of taxes on transactions under this Agreement to the extent permitted by applicable law.
ARTICLE 6 — DATA PROTECTION AND PRIVACY
6.1 Data Processing Agreement. The Parties shall comply with the Data Processing Agreement attached hereto as Exhibit C, which is incorporated herein by reference and forms an integral part of this Agreement. The DPA sets forth the Parties' respective obligations with respect to the processing of Personal Data by or on behalf of Lumos in connection with the provision of the Licensed Product to End Users through Reseller. In the event of any conflict between the terms of this Agreement and the terms of the DPA with respect to data protection matters, the terms of the DPA shall prevail to the extent of such conflict.
6.2 GDPR and UK GDPR Compliance. Each Party shall, in connection with its performance of its obligations under this Agreement, comply at all times with the GDPR, the UK GDPR, and all other applicable data protection and privacy laws, regulations, directives, and binding guidance in force in the jurisdictions in which it operates or in which Personal Data is collected, processed, stored, or transferred in connection with this Agreement. Without limiting the generality of the foregoing, each Party shall: (a) maintain appropriate records of its processing activities as required by Article 30 of the GDPR; (b) conduct data protection impact assessments as required by Article 35 of the GDPR; (c) cooperate with the supervisory authorities of the relevant EU and EEA member states and the UK Information Commissioner's Office; and (d) implement appropriate technical and organizational measures to ensure a level of security appropriate to the risk of the processing, as required by Article 32 of the GDPR.
6.3 Standard Contractual Clauses. For any transfer of Personal Data from the European Economic Area (EEA) or the United Kingdom to the United States or any other jurisdiction not subject to an adequacy decision of the European Commission or the UK Secretary of State (as applicable), the Parties shall rely on the Standard Contractual Clauses (Module Two — Controller-to-Processor) as incorporated into the DPA, supplemented by the transfer impact assessment and supplementary measures set forth therein. The Parties acknowledge and agree that the SCCs are incorporated into this Agreement by reference and shall be binding on the Parties as if set forth in full herein. In the event that the European Commission adopts new or revised standard contractual clauses, or any competent supervisory authority or court of competent jurisdiction determines that the existing SCCs are insufficient to provide an adequate level of protection for the transfer of Personal Data, the Parties shall cooperate in good faith to adopt and implement appropriate alternative transfer mechanisms as may be required to ensure the lawfulness of the relevant data transfers.
6.4 Data Localization. Lumos shall process and store all Personal Data of EMEA-based End Users and their authorized users on cloud infrastructure located within the European Union. Specifically, Lumos shall host all such Personal Data at the Frankfurt, Germany data center operated by Stratos Cloud Services AG, a Swiss corporation with its principal office at Bahnhofstrasse 42, 8001 Zürich, Switzerland (the "EU Data Center"). Lumos shall not transfer, replicate, or process any EMEA End User Personal Data outside of the European Union without the prior written consent of Reseller (which consent may be withheld in Reseller's sole discretion) and in compliance with the applicable provisions of the DPA and the SCCs, except to the extent strictly necessary for the provision of Tier 2 and Tier 3 technical support from Lumos's personnel located in the United States, and subject to the implementation of appropriate technical and organizational safeguards as set forth in the DPA.
6.5 Sub-Processors. Lumos shall provide Reseller with a current and complete list of all sub-processors engaged by Lumos to process Personal Data in connection with the Licensed Product, as set forth in Annex III to the DPA. Lumos shall notify Reseller in writing at least thirty (30) days prior to engaging any new sub-processor or replacing any existing sub-processor for the processing of Personal Data. Such notification shall include the name, location, and nature of the processing to be performed by the proposed sub-processor. Reseller shall have the right to object to the appointment or replacement of a sub-processor by providing Lumos with a written objection, setting forth reasonable grounds therefor, within fifteen (15) days of receiving Lumos's notification, in accordance with the procedures set forth in the DPA. If Reseller objects and the Parties are unable to resolve the objection through good-faith discussions within thirty (30) days, Reseller shall have the right to terminate this Agreement in accordance with Section 12.4(a), treating Lumos's engagement of the objected-to sub-processor as a material breach.
6.6 Security. Lumos shall implement and maintain appropriate technical and organizational measures to protect Personal Data against unauthorized or unlawful processing, accidental loss, destruction, alteration, or damage, consistent with: (a) the requirements of Article 32 of the GDPR; (b) industry-standard security frameworks, including SOC 2 Type II and ISO/IEC 27001:2022; and (c) the specific security commitments set forth in the SLA (Exhibit E). Without limiting the foregoing, Lumos's security measures shall include encryption of Personal Data at rest and in transit (using AES-256 and TLS 1.3, or their equivalents), access controls, multi-factor authentication, network segmentation, intrusion detection and prevention systems, regular vulnerability assessments and penetration testing, and incident response procedures. Lumos shall promptly notify Reseller in writing of any confirmed Personal Data breach in accordance with the DPA and Article 33 of the GDPR.
ARTICLE 7 — SERVICE LEVELS AND SUPPORT
7.1 Service Level Agreement. Lumos shall provide, operate, and maintain the Licensed Product in accordance with the Service Level Agreement attached hereto as Exhibit E and incorporated herein by reference. The SLA includes an uptime commitment of ninety-nine and ninety-five hundredths percent (99.95%) availability for the Lumos Prism™ platform, measured on a monthly basis, as hosted on the Stratos Cloud Services AG infrastructure at the EU Data Center in Frankfurt, Germany. The uptime commitment shall apply to the Licensed Product's core functionality, including the financial analytics engine, risk-modeling modules, reporting dashboards, and API endpoints, as further specified in the SLA. Lumos shall provide Reseller with monthly uptime reports, delivered within five (5) business days following the end of each calendar month, summarizing actual uptime performance, any service interruptions, and the root cause of any interruption that resulted in downtime exceeding fifteen (15) consecutive minutes.
7.2 Scheduled Maintenance. Lumos shall provide Reseller with not less than five (5) business days' advance written notice of any scheduled maintenance windows that may affect the availability or performance of the Licensed Product, except in cases of emergency maintenance necessitated by critical security vulnerabilities or imminent threats to data integrity, in which case Lumos shall provide as much advance notice as is reasonably practicable. Scheduled maintenance shall be performed, to the extent commercially reasonable, during off-peak hours (between 02:00 and 06:00 Central European Time, Saturday through Sunday). Periods of scheduled maintenance during which the Licensed Product is unavailable shall not count against the 99.95% uptime commitment set forth in the SLA, provided that scheduled maintenance does not exceed a cumulative total of eight (8) hours per calendar month.
7.3 Service Credits. In the event that Lumos fails to meet the uptime commitment specified in the SLA for any calendar month during the Term, Reseller and affected End Users shall be entitled to receive service credits calculated in accordance with the methodology set forth in the SLA. Service credits shall be issued by Lumos in the form of credits against future invoices and shall not be redeemable for cash or monetary refunds, except upon termination or expiration of this Agreement. The service credit schedule set forth in the SLA provides for increasing credits based on the severity and duration of the downtime. Service credits shall constitute Reseller's and End Users' sole and exclusive remedy, and Lumos's sole and exclusive liability, for any failure to meet the uptime commitment, except in cases of willful misconduct, gross negligence, or repeated and persistent failures constituting a material breach of this Agreement.
7.4 Support. Lumos shall provide Reseller with Tier 2 and Tier 3 technical support for the Licensed Product during the Term, in accordance with the support procedures, response times, and escalation paths set forth in the SLA (Exhibit E). Tier 2 support shall address advanced configuration, troubleshooting, and technical issues that are beyond the scope of Tier 1 support. Tier 3 support shall address complex software defects, platform-level issues, and engineering escalations requiring development team intervention. Reseller shall be responsible for providing Tier 1 technical support directly to End Users, including initial triage, basic troubleshooting, account management, password resets, and general usage inquiries. Reseller shall maintain a dedicated Tier 1 support team with sufficient language capabilities to support End Users across the EMEA Territory in English, German, and French, at a minimum. Lumos shall make Tier 2 and Tier 3 support available in English during Lumos's standard support hours (Monday through Friday, 06:00 to 18:00 Pacific Time), with after-hours emergency support available for Severity 1 (Critical) issues on a 24/7/365 basis, as defined in the SLA.
7.5 Escalation. Support escalation procedures, including the criteria for escalation between support tiers, the designated escalation contacts for each Party, and the expected response and resolution times for each severity level, are set forth in detail in the SLA (Exhibit E). Each Party shall designate a primary support manager and an alternate support manager as the principal points of contact for support-related communications. The Parties shall conduct monthly operational review calls to discuss open support tickets, recurring issues, service level performance, and opportunities for improvement.
ARTICLE 8 — REPRESENTATIONS AND WARRANTIES
8.1 Mutual Representations and Warranties. Each Party hereby represents and warrants to the other Party, as of the Execution Date and as of the Effective Date, that:
(a) it is duly organized, validly existing, and in good standing (or the equivalent thereof) under the laws of its jurisdiction of organization and has all necessary registrations, qualifications, and authorizations required to conduct its business as presently conducted;
(b) it has the full corporate or organizational power and authority to enter into this Agreement, to perform its obligations hereunder, and to consummate the transactions contemplated hereby, and the execution, delivery, and performance of this Agreement have been duly authorized by all necessary corporate or organizational action;
(c) the execution, delivery, and performance of this Agreement do not and will not: (i) violate any provision of its charter documents, bylaws, articles of association, or equivalent organizational documents; (ii) violate any applicable law, statute, regulation, rule, order, judgment, decree, or governmental requirement; or (iii) breach, conflict with, or constitute a default under any material agreement, contract, or obligation to which it is a party or by which it or its assets are bound;
(d) it is, and during the Term shall remain, in compliance with all applicable anti-corruption laws, including the U.S. Foreign Corrupt Practices Act (FCPA) (15 U.S.C. §§ 78dd-1 et seq.), the UK Bribery Act 2010, and all other applicable anti-corruption and anti-bribery laws in force in the jurisdictions in which it operates, and neither it nor any of its officers, directors, employees, agents, or representatives has made, offered, authorized, or will make, offer, or authorize any payment, gift, or transfer of anything of value, directly or indirectly, to any government official, political party, or candidate for political office for the purpose of obtaining or retaining business, or securing any improper advantage, in connection with this Agreement; and
(e) neither it nor any of its officers, directors, controlling shareholders, or beneficial owners is listed on, or is owned or controlled by any person or entity listed on, any applicable sanctions list maintained by OFAC (including the Specially Designated Nationals and blocked Persons List), the European Union (including the EU Consolidated List), the United Nations Security Council, Her Majesty's Treasury of the United Kingdom, or any other applicable governmental authority, and it is not located, organized, or resident in any Restricted Territory.
8.2 Lumos Representations and Warranties. Lumos represents and warrants to Meridian that:
(a) the Licensed Product, when used in accordance with its documentation and the terms of the EUSA, shall substantially conform to the specifications, functionality, and performance standards set forth in Exhibit A and the SLA (Exhibit E) during the Term;
(b) Lumos has all necessary rights, title, and interest in and to the Licensed Product and the Lumos Marks, including all intellectual property rights therein, sufficient to grant the rights and licenses contemplated by this Agreement, and Lumos has not entered into any agreement or arrangement that would conflict with or impair the rights granted to Reseller hereunder;
(c) to Lumos's actual knowledge as of the Execution Date, the Licensed Product, as provided by Lumos to Reseller and End Users, does not infringe, misappropriate, or otherwise violate the patent, copyright, trademark, trade secret, or other intellectual property rights of any third party; and
(d) Lumos implements and maintains commercially reasonable administrative, physical, and technical security measures, consistent with industry standards (including SOC 2 Type II certification and ISO/IEC 27001:2022 certification or their equivalents), for the protection of End User data, including Personal Data, processed, stored, or transmitted in connection with the Licensed Product.
8.3 Meridian Representations and Warranties. Meridian represents and warrants to Lumos that:
(a) Meridian has the financial resources, operational capabilities, technical expertise, market presence, and qualified personnel necessary to perform its obligations under this Agreement and to effectively market, promote, and resell the Licensed Product throughout the EMEA Territory;
(b) Meridian shall conduct all resale, marketing, promotional, and distribution activities in compliance with all applicable laws, regulations, and industry standards, including without limitation all export control, sanctions, anti-corruption, data protection, competition, and consumer protection laws applicable in the EMEA Territory and the jurisdictions in which Meridian operates;
(c) Meridian maintains, and shall continue to maintain during the Term and for a period of twelve (12) months following termination or expiration of this Agreement, commercially reasonable insurance coverage, including: (i) commercial general liability insurance with coverage limits of not less than Five Million Euros (€5,000,000) per occurrence; (ii) professional indemnity (errors and omissions) insurance with coverage limits of not less than Ten Million Euros (€10,000,000) per occurrence; and (iii) cyber liability insurance with coverage limits of not less than Five Million Euros (€5,000,000) per occurrence, as provided by Rheinland Versicherung AG under Policy No. RV-2024-1148703, or an equivalent carrier with a financial strength rating of "A-" or better from AM Best or an equivalent rating agency; and
(d) Meridian is duly registered with the Amtsgericht München under HRB 274581, holds German Tax Identification Number (Steuernummer) 143/117/60253, and is registered for VAT purposes with VAT Identification Number DE319274105, and all such registrations are current and in good standing.
8.4 Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND, WHETHER EXPRESS, IMPLIED, STATUTORY, OR OTHERWISE, WITH RESPECT TO THE LICENSED PRODUCT, THE LUMOS MARKS, OR ANY OTHER SUBJECT MATTER OF THIS AGREEMENT, AND EACH PARTY HEREBY SPECIFICALLY DISCLAIMS ALL IMPLIED WARRANTIES, IN