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Before joining the SBS development project, Norwest considered
other alternatives. In this regard, Norwest examined commercially
available software in the market, considering the products'
functionality, economic benefit, scalability, and applicability to
interstate banking activities. In particular, Norwest focused on
a software product offered by Hogan Systems, Inc. (Hogan). Norwest
ultimately rejected the Hogan product because it did not meet
Norwest's volume and economic benefit criteria.
Norwest also considered building its own system. It abandoned
this idea, however, believing that the opportunity to enter into a
development project with EDS and Bank One would enable it to
achieve its goal and limit its risk. Accordingly, on December 16,
1986, Norwest entered into a Participant Agreement10 with Bank One,
and a separate Participant License Agreement with EDS.
Section 3.2 of the Participant Agreement between Bank One and
Norwest provided for Norwest's role in the development of SBS:
In connection with the development of the Financial
System by EDS as contemplated under the [EDS-Bank One]
Participation Agreement, Norwest will, on a timely basis
9(...continued)
As part of a separate license agreement, Norwest paid EDS $1.2
million to use the software in connection with services provided
to nonaffiliated financial institutions.
Under the participant and license agreements, EDS maintained
all ownership rights to the SBS system.
10 The Participant Agreement was amended on Sept. 8, 1988,
Feb. 8, 1992, and again in July 1992.
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