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<br />2) any additional obligations they have to you, or 3) any products or services that they supply to you under their agree-
<br />ments.
<br />
<br />1.7 Patents and Copyrights
<br />For purposes of this section, the term "Product" includes Materials, Machine Code and LlC.
<br />
<br />If a third party claims that a Product IBM provides to you infringes that party's patent or copyright, IBM will defend you
<br />against that claim at its expense and pay all costs, damages, and attorney's fees that a court finally awards or that are
<br />included in a settlement approved by IBM, provided that you:
<br />1, promptly notify IBM in writing of the claim; and
<br />2. allow IBM to control, and cooperate with IBM in, the defense and any related settlement negotiations,
<br />
<br />Remedies
<br />If such a claim is made or appears likely to be made, you agree to permit IBM to enable you to continue to use the
<br />Product, or to modify it, or replace it with one that is at least functionally equivalent If IBM determines that none of
<br />these alternatives is reasonably available, you agree to return the Product to IBM on its written request IBM will then
<br />give you a credit equal to:
<br />1. for a Machine, your net book value provided you have followed generally-accepted accounting principles;
<br />2, for an ICA Program, the amount paid by you or 12 months' charges (whichever is less); and
<br />3, for Materials, the amount you paid IBM for the creation of the Materials.
<br />
<br />This is IBM's entire obligation to you regarding any claim of infringement
<br />
<br />Claims for Which IBM is Not Responsible
<br />IBM has no obligation regarding any claim based on any of the following:
<br />1, anything you provide which is incorporated into a Product or IBM's compliance with any designs, specifications, or
<br />instructions provided by you or by a third party on your behalf;
<br />2. your modification of a Product, or an ICA Program's use in other than its Specified Operating Environment;
<br />3. the combination, operation, or use of a Product with other products not provided by IBM as a system, or the com-
<br />bination, operation or use of a Product with any product, data, apparatus, or business method that IBM did not
<br />provide, or the distribution, operation or use of a Product for the benefit of a third party outside your Enterprise; or
<br />4. infringement by a non-IBM Product or an Other IBM Program alone.
<br />
<br />1.8 Limitation of Liability
<br />Circumstances may arise where, because of a default on IBM's part or other liability, you are entitled to recover dam-
<br />ages from IBM, In each such instance, regardless of the basis on which you are entitled to claim damages from IBM
<br />(including fundamental breach, negligence, misrepresentation, or other contract or tort claim), IBM is liable for no more
<br />than:
<br />1. payments referred to in the Patents and Copyrights section above;
<br />2. damages for bodily injury (including death) and damage to real property and tangible personal property; and
<br />3. the amount of any other actual direct damages up to the greater of $100,000 or the charges (if recurring, 12
<br />months' charges apply) for the Product or Service that is the subject of the claim, For purposes of this item, the
<br />term "Product" includes Materials, Machine Code, and LlC.
<br />
<br />This limit also applies to any of IBM's subcontractors and Program developers. It is the maximum for which IBM and its
<br />subcontractors and Program developers are collectively responsible,
<br />
<br />Items for Which IBM is Not Liable
<br />Under no circumstances is IBM, its subcontractors, or Program developers liable for any of the following even if in-
<br />formed of their possibility:
<br />1. loss of, or damage to, data;
<br />2. special, incidental, or indirect damages or for any economic consequential damages; or
<br />3. lost profits, business, revenue, goodwill, or anticipated savings,
<br />
<br />1.9 General Principles of Our Relationship
<br />1, Neither of us grants the other the right to use its (or any of its Enterprise's) trademarks, trade names, or other des-
<br />ignations in any promotion or publication without prior written consent
<br />2, All information exchanged is nonconfidential. If either of us requires the exchange of confidential information, it will
<br />be made under a signed confidentiality agreement
<br />3. Each of us is free to enter into similar agreements with others.
<br />4, Each of us grants the other only the licenses and rights specified. No other licenses or rights (including licenses or
<br />rights under patents) are granted.
<br />5. Each of us may communicate with the other by electronic means and such communication is acceptable as a
<br />signed writing. An identification code (called a "user ID") contained in an electronic document is sufficient to verify
<br />the sender's identity and the document's authenticity.
<br />6. Each of us will allow the other reasonable opportunity to comply before it claims that the other has not met its obli-
<br />gations.
<br />7. Neither of us will bring a legal action arising out of or related to this Agreement more than two years after the
<br />cause of action arose.
<br />8, Neither of us is responsible for failure to fulfill any obligations due to causes beyond its control.
<br />
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<br />City of Sunny Isles Beach, Florida IBM Customer Agreement 07"2006.doc
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