Value Added Industry Remarketer Agreement

VALUE ADDED INDUSTRY REMARKETER AGREEMENT





THIS VALUE ADDED INDUSTRY REMARKETER AGREEMENT (the "Agreement") is between SIEBEL SYSTEMS, INC. with its principal place of business at 1855 South Grant Street, San Mateo, CA 94402 ("Siebel"), and CORIO, INC. ("Distributor"), with its principal place of business at 700 Bay Street, Suite 210. Redwood City, CA 94063



1. DEFINITIONS



1.1 "AFFILIATE" shall mean any corporation, company or other entity controlled by, controlling, or under common control with Distributor. Such entity shall be deemed to be an "Affiliate" only so long as such control exists. Upon request, Distributor a grees to confirm the Affiliate status of a particular entity.



1.2 "ANCILLARY PROGRAMS" shall mean the third party software delivered with the Licensed Software as specified in EXHIBIT A. an Order Form, or the Documentation



1.2A "APPLICATION HOSTING SERVICES" shall mean professional information processing and hosting services provided to a Customer by Distributor at Distributor's site in connection with such Customer's use of the License Programs.



1.3 "CUSTOMER" or "END USER" means an entity to whom Distributor provides a valid license to use the Licensed Software in accordance with the terms of this Agreement for such entity's internal business purposes in accordance with the End User License Agreement, and not for redistribution or resale.



1.4 "DOCUMENTATION" shall mean Siebel's then current on-line help, guides, and manuals published by Siebel and made generally available by Siebel for the Licensed Software.



1.5 "EFFECTIVE DATE" shall mean the effective date set forth at the end of this Agreement.



1.6 "END USER LICENSE AND SERVICES AGREEMENT" shall mean Distributor's standard license and services agreement accompanying each copy of the Licensed Software resold under this Agreement which includes the minimum terms and conditions se t forth in EXHIBIT F and the terms relating to Distributor's provision of Application Hosting Services.



1.7 "ERROR" shall mean the failure of the Programs to perform in all material respects the functions described in the Documentation when operated on a Supported Platform.



1.8 "FIRST-LINE SUPPORT" shall mean direct technical support of Licensed Software provided to Users, as set forth in Section 3.5(a).



1.9 "INITIAL TERM" means the period commencing on the Effective Date and continuing as set forth in EXHIBIT A, unless earlier terminated as set forth in Section 12.



1.10 "LICENSED SOFTWARE" means the object code form of the software programs listed on EXHIBIT A attached hereto excluding the Ancillary Programs listed on EXHIBIT A



1.11 " MARKETING MATERIALS" means Siebel's standard brochures, data sheets, collateral, magazines, article reprints, industry analyst reports, videotapes, books and other marketing materials that Siebel, in its discretion, makes available to Distributor to assis t in its marketing and promotion of the Licensed Software.



1.12 "MAINTENANCE AND SUPPORT SERVICES" shall mean the services set forth in Section 3.4.



1.13 "ORDER FORM" shall mean the document, substantially in the form included in the Minimum Terms of End User License Agreement set forth at EXHIBIT F, that is signed by both the Customer and distributor and specifies the Licensed Software licensed to a particular Customer by Distributor.



1.14 "PRE-PRODUCTION PROGRAM" shall mean a software program which is (i) not generally licensed for commercial use by Siebel, (ii) not listed as generally available in Siebel's marketing literature, or (iii) design ated by Siebel as an "Alpha," "Beta," or "Pre-Production" program or release. Siebel shall notify Customer in writing that a particular software program is a Pre-Production Program



1.15 "SECOND-LINE SUPPORT" shall mean direct technical support of Licensed Software provided to Customers, as set forth in Section 3.4(b).



1.16 "SOLUTION" means the Licensed Software integrated with the Value Added Offering integrated as provided in Section 3.1.



1.17 "SUBLICENSE FEE" means the sublicense fee set forth in EXHIBIT A due and payable to Siebel for each license of the Licensed Software to a Customer.



1.18 "SUPPORTED PLATFORM" shall mean the hardware and software platforms (e.g., database server systems, application server systems, and client systems) th at are supported by Siebel as expressly set forth in the Documentation. The requirements for the Supported Platform are subject to change as specified by Siebel in its discretion with ninety (90) days prior written notice to Customer or Distributor.



1.19 "Territory" shall be the geographic area described in EXHIBIT A.



1.20 "THIRD-LINE SUPPORT" shall mean technical support of Licensed Software, as set forth in Section 3.5(c).



1.21 "TRAINING MATERIALS" shall mean the standard generally available Siebel training materials, as set forth in Technical Services schedule in effect at the time such training materials are ordered by Distributor.



1.22 "UPDATES" shall mean (a) subsequent releases of the Programs that (i) add new features, functionality, and/or improved performance, (ii) operate on new or other databases, (iii) add new foreign language capabilities, or (iv) are new foreign language versions of the Programs; (b) bug or Error fixes, patches, Workarounds, and maintenance releases; (c) new po i nt releases, including those denoted by a change to the right of the first decimal point (e.g., v3.0 to 3.1), and (d) new major version releases, regardless of the version name or number, but including those denoted by (i) a change to the left of the firs t decimal point (e.g., v3.0 to 4.0) and/or (ii) the addition of a date designation or a change in an existing date designation (e.g., v1999 to 2000). Updates shall not include separate products which Siebel offers only for an additional fee to its customer s generally, including those customers purchasing Maintenance Services.



1.23 "USER" shall mean the named or specified (by password or other user identification) individuals authorized by Customer to use Licensed Software, regardless of whether the indiv idual is actively using the Licensed Software at any given time. The maximum number of Users that may use the Licensed Software shall be specified in an Order Form signed by Customer and Distributor. Users may include the employees of Customer or third pa r ties, provided that such third party is limited to use of the Licensed Software (i) only as configured and deployed by Customer, and (ii) solely in connection with Customer's business operations as conducted by or through such third party, including but n o t limited to the installation, administration or implementation of the Licensed Software for Customer. Distributor agrees that it is responsible for ensuring that any third party usage is authorized by Customer in accordance with the terms and conditions o f this Agreement. Notwithstanding the foregoing, Users shall exclude any individuals employed by, or acting on behalf or under the direction or control of, a direct competitor of Siebel Upon request, Siebel shall provide Distributor with a listing of its direct competitors



1.24 "VALUE ADDED OFFERING" means the hardware, software, and/or services, as described in EXHIBIT A, that Distributor provides to Customers in connection with the Licensed Software.



1.25 "WORKAROUND" shall mean a resolution of an Error which enables Customer to access similar but not equivalent functionality to that described in the Documentation which does not introduce additional Errors to the operation of the Licensed Software.



2. GRANT OF RIGHTS



2.1 LICENSE GRANT. Subject to the terms and conditions of this Agreement, Siebel hereby appoints Distributor as a distributor of the Licensed Software and grants to Distributor the following non-transferable rights, all of which may be exercised only by Distributor in the Territory and during the License Term. This appointment shall be on a non-exclusive basis. These rights may not be sublicensed except as expressly permitted in this Section 2.1.



(a) To reproduce, exactly as provided by Siebel, object code copies of the Licensed Software and Ancillary Programs or portions thereof solely to exercise the rights granted in this Section 2.1;



(b) To distribute and sublicense to Customers the right to use the Licensed Software and Ancillary P rograms or portions thereof on a limited term basis in accordance with the terms of the End User License Agreement, subject to the restrictions in Section 5;





[*] Certain information on this page has been omitted and filed separately with

the Commission. Confidential treatment has been requested with respect to

the omitted portions. (c) To use the Licensed Software and Ancillary Programs for the sole purposes of operating the Licensed Software on Distributor's computer hardware and operatin g system(s) to (i) test and evaluate the Licensed Software, (ii) train Distributor's personnel in the marketing and sales of the Licensed Software, (iii) demonstrate and promote the Licensed Software to potential Customers, and (v) provide First-Line Supp o rt and Second-Line Support to Customers by using the License Software in a test environment to (1) diagnose reported problems or performance deficiencies of the Licensed Software, and (2) resolve such problems or deficiencies. Notwithstanding the foregoin g , Distributor may (i) not use the Licensed Software internally in a production capacity to run any of its business operations including the sales and customer service activities associated with its End User Customers, or (ii) use the Siebel Tools Programs set forth in EXHIBIT A solely in accordance with the Documentation for the limited purpose of configuring the Licensed Software for distribution with the Value Added Offering and not for general application development purposes,



(d) To copy the Li censed Software for archival or backup purposes, and to make a sufficient number of copies for the use by Distributor as permitted in this Section 2.1, provided that all titles and trademark, copyright, and restricted rights notices are reproduced on all such copies;



(e) To distribute to Customers, exactly as provided by Siebel, any Documentation, Training Materials and Marketing Materials provided by Siebel, subject to the payment of fees set forth in Section 6.2. Distributor shall not reproduce t he Documentation, Training Materials, or Marketing Materials for any purpose



2.2 END USER LICENSE AGREEMENT. Distributor shall enter into a written End User License and Services Agreement with each Customer to whom Distributor grants any rights to use Licensed Software or Ancillary Programs. Each End User License and Services Agreement shall (i) contain the minimum terms attached hereto as EXHIBIT F and (ii) be at least as protective of Siebel's rights and interests as the terms of EXHIBIT F. Each End User License Agreement and Services Agreement shall specify the maximum number of Users permitted to use the Licensed Software. Distributor shall use its reasonable efforts to ensure that Customer does not exceed the maximum number of Users set forth in t he End User License and Services Agreement.



2.3 SOURCE CODE ESCROW. Customer shall have the right to become a beneficiary to the Master Preferred Escrow Agreement between Siebel and Data Securities International, Inc., a copy of which will be provided to Customer upon request and which will be incorporated by reference into this Agreement when Customer executes an Acceptance Form pursuant to the Master Preferred Escrow Agreement. All rights and licenses granted under or pursuant to this Agreement are a nd shall otherwise be deemed to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code, licenses of rights to "intellectual property" as defined under section 101(56) of the U.S. Bankruptcy Code.



3. DISTRIBUTOR OBLIGATIONS



3.1 DISTRIBUTOR 'S VALUE ADDED OFFERING. Notwithstanding anything to the contrary in this Agreement, Distributor understands and agrees that during the License Term, Distributor shall distribute the Licensed Software to Customers only in conjunction and concurrently with a Value Added Offering and not on a standalone basis; provided, however, that this requirement shall not apply to Distributor's distribution of Updates to the Licensed Software to an existing Customer who has licensed the Licensed Software in connection w i th the Value Added Offering. The Value Added Offering shall materially differentiate the Solution from the Licensed Software; provided, however, that nothing contained in this Section or in this Agreement shall in any way limit or restrict the freedom of D istributor to determine the resale price for the Solution as set forth in Section 3.2. Distributor agrees that it shall provide and maintain the Value Added Offering in a manner consistent with generally accepted industry standards and Distributor's best practices.



3.2 DISTRIBUTOR'S PRICING OF THE SOLUTION. Distributor shall be free to determine list pricing and any volume or other applicable discounts for the Solution.



3.3 INSTALLATION AND TRAINING SERVICES. Distributor shall be responsible for c onducting all activities required to install the Licensed Software at its Customers' locations and for providing training to such Customers and any system integrators involved in such installation. All such installation and training shall be conducted in a ccordance with generally accepted industry standards and Distributor's best practices. At Distributor's request, Siebel shall provide to Distributor the Documentation and Training Materials at Siebel's list prices in effect as of the date such Documentati on and Training Materials are ordered.



3.4 MAINTENANCE AND SUPPORT SERVICES. Distributor shall provide Maintenance and Support Services to all of its Customers of Licensed Software as set forth in Sections 3.4(a) and 3.4(b) below. Distributor may requi re Customers to provide the own First-Line Support: however, in no event shall Siebel be responsible for First-Line or Second-Line Support. Subject to Distributor's payment of the Maintenance Fees set forth in EXHIBIT A Siebel shall provide Third-Line Sup port to Distributor in accordance with Siebel's then current Maintenance and Support Services Policy. Distributor shall be responsible for all support related to the Value Added Offering.



(a) FIRST-LINE SUPPORT. Distributor shall either (1) provide First-Line Support to all of its Customers of the Licensed Software or (2) inform its Customers that they must provide their own First-Line Support. First-Line Support means direct techn i cal support of Licensed Software, including but not limited to (a) a direct response to Customer and User inquiries concerning the performance, functionality or operation of the Licensed Software, (b) a direct response to reported problems or performance d eficiencies with the Licensed Software, (c) a diagnosis of problems or performance deficiencies of the Licensed Software, and (d) a resolution of problems or performance deficiencies of the Licensed Software. First Line Support includes the support descri b ed as "First Line Support" in EXHIBIT B. First-Line Support shall include the provision of telephone and other appropriate contact points so that Customers may contact Distributor regarding technical and support questions and other problems regarding use o f the Licensed Software. Distributor shall inform Customers that if, after using its reasonable commercial efforts, the Customer is not able to answer a support question or to correct a reported problem in the Licensed Software, the Customer may contact D istributor for Second-Line Support, as provided below.



(b) SECOND-LINE SUPPORT. Distributor will offer second line support ("Second-Line Support") to Customers in the form of web-based and telephone and other support at least at the level of Second Line Support described in Siebel's then current Maintenance and Support Services Policy. A copy of Siebel's Maintenance Policy as of the date of this Agreement is set forth in EXHIBIT B. Siebel reserves the right to alter such policies from time to time, in its reasonable discretion, on ninety (90) days' prior notice to Distributor. Distributor is hereby authorized to distribute to its Customers, as a part of Second-Line Support, any and all Updates that Siebel provides Distributor.



(c) THIRD-LINE SUPPORT. In consideration for the payment of Siebel Maintenance Fees set forth in EXHIBIT A, Siebel shall provide Distributor third line support ("Third-Line Support") for the Licensed Software in accordance with Siebel's then current Maintenance and Sup p ort Services Policy. This shall include web-based and telephone support to respond to questions that are due solely to the failure of the Licensed Software to perform in any material respect the functions described in the Documentation when operated on a S upported Platform. Before requesting Third-Line Support, Distributor shall use reasonable commercial efforts to resolve support questions and to correct reported problems in the Licensed Software and to ensure that the issue is not related to any other pa r t of the Solution. If Distributor requests Siebel to provide services at a customer site or at Distributor, Distributor agrees to pay Siebel for such services in accordance with Siebel's list prices for such services as of the date such services are deliv ered and to reimburse Siebel for all its out-of-pocket expenses, including travel and accommodations, in providing such services.



3.5 SIEBEL CERTIFICATION OF DISTRIBUTOR TECHNICAL SUPPORT STAFF. Distributor shall hire and maintain sufficient technical support personnel as are needed to support the Licensed Software and achieve the Customer satisfaction levels required under Section 3.7. Distributor agrees to hire and maintain at all times during the term of this Agreement, at a minimum, two technical s u pport engineers who have successfully completed the following Siebel training certification ("Siebel Certification Training"): (i) the Siebel training program as described in Siebel's then current program description, (ii) the required competency testing, and (iii) one week of additional training with Siebel technical support engineers at the Siebel support center designated by Siebel. Distributor will be responsible for all training fees and costs associated with obtaining Siebel Certification Training. D istributor's support staff must be fluent in English and all Customer languages spoken in the Territory.



3.6 DISTRIBUTOR MAINTENANCE REPORTING REQUIREMENTS. Distributor will maintain proper records of Maintenance and Support Services provided to Custom ers. Siebel may, at its expense, audit (using personnel with auditing experience) any such records to verify Distributor's performance of its support obligations. On a monthly basis, Distributor will provide Siebel a report to Siebel containing the follow i ng new customer information: (i) Customer name, (ii) Customer hardware and software configurations, (iii) Customer contact names, (iv) Customer contact information, including address, telephone number, and email address, and (v) term of Customer's Mainten a nce and Support Services Agreement. Within thirty (30) days of the end of each quarter, Distributor shall provide Siebel a report in a form specified by Siebel showing in detail (i) the number of support calls received during such quarterly period with th e associated seventy level, (ii) the overall average response time









by seventy level for such support calls, (iii) the overall average resolution time by seventy level for such support calls; and (iv) other information reasonably requested by Siebel.



3. 7 CUSTOMER SATISFACTION REQUIREMENT. Siebel may, at its discretion, survey Customers to determine the level of Customer satisfaction with the Maintenance and Support Services and other services provided by Distributor Siebel shall reasonably determine after consultation with Distributor the questions to be asked in the survey and the measurement scale. If the results of the survey indicate a level of dissatisfaction with Distributor's Customers (e.g. a gap of more than 2 on a 10 point scale in any surv e yed category where the gap represents the difference between the importance level to the customer and customer's satisfaction, then (i) Siebel will notify Distributor, (ii) the parties will work together to develop a improvement plan to improve Customer s a tisfaction. In the event Distributor Customer satisfaction levels fall substantially below Siebel's (i.e. where the difference in the gap is more than 2) for two consecutive calendar quarters after Distributor has received written notice of the deficiency , then Siebel shall have the option to terminate the Agreement for cause upon written notice to Distributor.



3.8 SIEBEL TECHNICAL SERVICES. Siebel shall provide Technical Services to Distributor, subject to availability, as agreed to from time to time by the parties, in accordance with Siebel's Technical Services schedule in effect at the time such services are ordered (available upon request). Distributor shall pay Siebel's reasonable and actual out-of-pocket expenses associated with Siebel's delivery of Technical Services.



3.9 CUSTOMER VISITS. Siebel may visit Distributor's Customers from time to time upon reasonable advance notice and with Customer's approval, to stay abreast of customer requirements and to evaluate features for potential future products. Distributor agrees to provide Siebel reasonable assistance in arranging such visits with Customers. Siebel agrees that it will involve Distributor in such visits in the event Siebel reasonably determines such involvement is reasonably appropriat e.



3.10 DISTRIBUTOR WARRANTIES. Distributor represents and warrants that as of the Effective Date and continuing throughout the License Term:



(A) Distributor will maintain the facilities, resources and experienced personnel necessary to market and distribute Licensed Software and to perform the necessary installation, training and maintenance services related to such Licensed Software and otherwise to fulfill its obligations under this Agreement;



(B) Distributor is not precluded by any existing arrangement, contractual or otherwise, from entering into this Agreement and performing hereunder,



(C) Distributor will make no representations or warranties related to the Licensed Software in excess of Siebel's representations or warranties contained in Section 10 of this Agreement;



(D) Distributor has not relied on any promises or representations other than those promises or representations expressly made in writing in this Agreement;



(E) If Distributor becomes aware of any actual or suspected unauthorized use, copying or disclosure of the Licensed Software or Anciliary Progr ams. Distributor will promptly notify Siebel and will assist Siebel, at Siebel's expense and request, in the investigation and prosecution of such unauthorized use, copying or disclosure; and



(F) Distributor has the full right, power and authority to enter into this Agreement and to carry out its obligations hereunder, and there are no impediments known to Distributor which would prevent Distributor compliance with all the terms of this Agreement.



3.11 DISTRIBUTOR INDEMNITY. Subject to the limi tation of liability set forth in Section 11 ("Limitation of Liability"), Distributor will indemnify Siebel for, and hold Siebel harmless from, any loss, expense, damages, claims, demands, or liability arising from any claim, suit, action or demand resulti n g from: (a) the material uncured breach of any terms of this Agreement: (b) the use of the Licensed Software and Ancillary Programs by any Customer of Distributor except for claims which arise directly from or relate directly to material uncured breaches o f Siebel's obligations under this Agreement or fall within Siebel's indemnification obligations under this Agreement, including but not limited to Siebel's warranties with respect to the Licensed Software; or (c) any claim related to the Value Added Offer ing.



3.12 MARKETING AND SALES EFFORTS. Distributor and Siebel shall meet to jointly prepare a mutually agreeable marketing plan (the "Marketing Plan") to promote and market the Licensed Software as part of a solution to Customers and potential Customers in order to maximize the licensing and distribution of the Licensed Software to Customers. Such Marketing Plan will include an annual commitment by Distributor of $100,000 to be spent on the marketing efforts described in the marketing Plan Distributor a g rees further that its marketing and advertising efforts with respect to the Licensed Software will be of the highest quality and shall preserve the professional image and reputation of Siebel and the Licensed Software. Within ninety (90) calendar days fro m the Effective Date, Distributor agrees to appoint and train, to the reasonable satisfaction of Siebel, sufficient sales persons and/or technical support consultants as are needed to satisfy Distributor's obligation to use its reasonable efforts to market and sell the Licensed Software. Distributor agrees that its staff shall achieve a level of competence in the Licensed Software and will participate in applicable certification programs that Siebel may establish Each party shall appoint a channel manager t o manage the relationship described in this Agreement and to assist in addressing issues that may arise. Each party shall use reasonable efforts to provide the other party with qualified leads related to the products and services distributed by the other p arty.



3.13 POLICY CHANGES From time to time Siebel may institute new or revised policies and procedures regarding the distribution and licensing of the Licensed Software, Updates, Documentation and Ancillary Programs. Siebel will provide written notice of such policies and procedures to Distributor, and Distributor agrees to use its reasonable efforts to implement such policies and procedures.



4. DELIVERY



Within ten (10) days of the Effective Date, Siebel will use its reasonable efforts to deliver the License Software and Siebel's Documentation electronically provided (i) Distributor agrees to set up a secure FTP site or to take other reasonable measures to assist Siebel in the secure delivery of the Licensed Software and Documentation (i.e., esta b lishing a FTP server), and (ii) Siebel and Distributor each will provide the other party with tangible evidence that the Licensed Software and Documentation were electronically transmitted and received. Siebel will provide Distributor with electronic copi e s any Updates Siebel makes available as promptly as practicable following the general release thereto, and Distributor agrees that it will incorporate such Updates into the Licensed Software which it provide to new Customers as promptly as reasonably poss i ble; provided, however, Distributor shall only offer "Supported Programs" to its Customers as such term is defined in EXHIBIT B. From time to time during the License Term, Siebel will, upon request and subject to availability, provide Distributor a reason able number of copies of Marketing Materials for distribution to potential customers.



5. RESTRICTIONS REGARDING THE LICENSED SOFTWARE



5.1 LICENSE RESTRICTIONS. Distributor acknowledges that, except as explicitly stated in this Agreement, the Agre ement does not grant Distributor any right or license to the Licensed Software or Ancillary Programs or any proprietary rights therein, and no license or other rights shall be created by implication or estoppel. In particular, but without limiting the gen e rality of the foregoing, no right or license in or to source code for the Licensed Software or Ancillary Programs is granted hereunder. Distributor ...